Exeter Fund, Inc.
Semi-Annual Report
April 30, 2000
Tax Managed Series
<PAGE>
Management Discussion and Analysis (unaudited)
DEAR SHAREHOLDERS:
Over the course of the last year, the stock market has given investors a
roller-coaster ride. While stocks finished 1999 with strong returns, the
environment, undoubtedly, leaves people scratching their heads. Many
publications like to report the gaudy numbers of how the stock market performed
over 1999, but perhaps the most intriguing statistic we've seen about last
year's market is the price change of the median stock on the New York Stock
Exchange: -4.4%. In actuality, the typical U.S. stock went down in 1999,
despite the impression created by composites that are skewed by capitalization
weighting.
So far this year, the Dow Jones Industrial Average has been extremely volatile,
closing up or down at least 100 points on 28 different days during the first
quarter, and finishing with a -4.6% return. From a tax-management standpoint,
the present volatility can offer a number of good buying opportunities that may
be beneficial in the long-run.
This year, our energy and health care stocks have led the way for us, reporting
strong returns and outpacing the S&P 500 in both sectors. International stocks
have maintained an important role, as we have continued to identify value
abroad. This gives us the opportunity to do well even when the domestic
environment is inhospitable to value investors. This experience emphasizes the
fact that fundamental investment disciplines are a form of universal language,
as we have been able to add value as investors in foreign markets over time,
using the same traditional strategies we developed in the U.S. market. We
believe that concentrating on fundamentals and avoiding overvalued securities is
the key to long-term success in the markets.
The Tax Managed Series has continued to provide solid returns, while remaining
focused on the added goal of minimizing taxable distributions. This is
accomplished through strategic, tax-driven security sales.
As of late, there have been more and more articles in the press about long-time
value managers finally caving in to performance pressures and abandoning their
performance styles. We have not. Right now, we are coming off a year in which
performance was good, and our valuation disciplines remain firmly intact. While
it is still too early to tell, the sharp disruptions in some of the high-flying
areas of the market lately suggest that the best may be yet to come for those
who have stayed true to fundamental investment disciplines.
As always, we appreciate the opportunity to serve you.
Sincerely,
EXETER ASSET MANAGEMENT
1
<PAGE>
Management Discussion and Analysis (unaudited)
[graphic]
[pie chart]
Portfolio Composition - As of 4/30/00
Chemicals & Allied Products - 17%
Crude Petroleum & Natural Gas - 11%
Electronics & Electrical Equipment - 5%
Food & Kindred Products - 9%
Glass Products - 5%
Paper & Allied Products - 5%
Restaurants - 2%
Rubber & Plastic Footwear - 2%
Software - 5%
Technical Instruments & Supplies - 7%
Telecommunication Services - 4%
Transportation - 8%
Cash, short-term investments, and other assets, less liabilities - 4%
Miscellaneous* - 16%
* Miscellaneous
Air Transportation
Business Services
Computer Equipment
Health Services
Industrial & Commercial Machinery
Investors
Motion Picture Production
National Commercial Banks
Non-Depository Credit Institutions
Primary Metal Industries
2
<PAGE>
Performance Update as of April 30, 2000 (unaudited)
Exeter Fund, Inc. - Tax Managed Series
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $12,553 25.53% 25.53%
Inception 1 $22,587 125.87% 19.84%
</TABLE>
Standard & Poor's 500 Total Return
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $11,012 10.12% 10.12%
Inception 1 $26,934 169.34% 24.62%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Tax Managed Series
from its inception (11/1/95) to present(4/30/00) as compared to the Standard &
Poor's (S&P) 500 Total Return Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Standard & Poor's 500
Date Tax Managed Series Total Return Index
<S> <C> <C>
11/01/1995 10,000 10,000
10/31/1996 11,630 12,408
10/31/1997 15,200 16,392
10/31/1998 14,855 19,996
10/31/1999 18,129 25,127
04/30/2000 22,587 26,934
</TABLE>
1 The Fund and Index performance are calculated from November 1, 1995, the
Fund's inception date. The Fund's performance is historical and may not be
indicative of future results.
2 The Standard & Poor's (S&P) 500 Total Return Index is an unmanaged
capitalization-weighted measure of 500 widely held common stocks listed on the
New York Stock Exchange, American Stock Exchange, and the Over-the-Counter
Market. The Index returns assume reinvestment of income and, unlike Fund
returns, do not reflect any fees or expenses.
3
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
COMMON STOCK -96.36%
<S> <C> <C>
AIR TRANSPORTATION - 0.93%
FedEx Corp.* . . . . . . . . . . . . . . . . . . . . 400 $ 15,075
---------
BUSINESS SERVICES - 1.79%
National Data Corp.. . . . . . . . . . . . . . . . . 1,050 29,138
---------
CHEMICAL & ALLIED PRODUCTS - 17.43%
PHARMACEUTICAL PREPARATIONS - 9.50%
Johnson & Johnson. . . . . . . . . . . . . . . . . 175 14,438
Mylan Laboratories, Inc. . . . . . . . . . . . . . 1,300 36,888
Pharmacia Corp.. . . . . . . . . . . . . . . . . . 446 22,272
Teva Pharmaceutical Industries Ltd. - ADR (Note 7) 1,200 52,800
Warner - Lambert Co. . . . . . . . . . . . . . . . 250 28,453
-------
154,851
-------
MISCELLANEOUS - 7.93%
Eastman Chemical Co. . . . . . . . . . . . . . . . 800 41,850
Gillette Co. . . . . . . . . . . . . . . . . . . . 500 18,500
Sigma-Aldrich Corp.. . . . . . . . . . . . . . . . 1,325 38,921
Sherwin Williams Co. . . . . . . . . . . . . . . . 1,200 29,850
-------
129,121
-------
283,927
-------
COMPUTER EQUIPMENT - 3.13%
Bell & Howell Co.* . . . . . . . . . . . . . . . . . 600 15,937
Compaq Computer Corp.. . . . . . . . . . . . . . . . 1,200 35,100
-------
51,037
-------
CRUDE PETROLEUM & NATURAL GAS - 10.56%
Gulf Canada Resources Ltd. - ADR* (Note 7) . . . . . 11,000 45,375
Halliburton Co.. . . . . . . . . . . . . . . . . . . 600 26,513
Petroleo Brasileiro S.A. (Petrobras) -
ADR (Note 7). . . . . . . . . . . . . . . . . . . 3,100 73,443
Schlumberger Ltd. - ADR (Note 7) . . . . . . . . . . 350 26,797
-------
172,128
-------
ELECTRONICS & ELECTRICAL EQUIPMENT - 5.08%
Koninklijke Philips Electronics NV-ADR (Note 7). . . 920 41,055
Motorola, Inc. . . . . . . . . . . . . . . . . . . . 350 41,672
-------
82,727
-------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
<S> <C> <C>
FOOD & KINDRED PRODUCTS - 9.06%
Bestfoods. . . . . . . . . . . . . . . . . 450 $ 22,613
Diageo plc - ADR (Note 7). . . . . . . . . 800 27,200
Flowers Industries, Inc. . . . . . . . . . 1,000 15,250
H.J. Heinz Co. . . . . . . . . . . . . . . 1,000 34,000
Unilever plc - ADR (Note 7). . . . . . . . 1,950 48,506
---------
147,569
---------
GLASS PRODUCTS - 5.45%
Corning, Inc.. . . . . . . . . . . . . . . 450 88,875
---------
HEALTH SERVICES -1.76%
Caremark Rx, Inc.* . . . . . . . . . . . . 4,500 28,688
---------
INDUSTRIAL & COMMERCIAL MACHINERY - 1.68%
Baker Hughes, Inc. . . . . . . . . . . . . 275 8,748
Parker-Hannifin Corp.. . . . . . . . . . . 400 18,600
---------
27,348
---------
INVESTORS - 1.49%
Reed International plc - ADR (Note 7). . . 850 24,331
---------
MOTION PICTURE PRODUCTION - 1.55%
News Corporation Ltd. - ADR (Note 7) . . . 575 25,300
---------
NATIONAL COMMERCIAL BANKS - 2.31%
Bank of New York Company, Inc. . . . . . . 175 7,186
Chase Manhattan Corp.. . . . . . . . . . . 100 7,206
FleetBoston Financial Corp.. . . . . . . . 225 7,973
Mellon Financial Corp. . . . . . . . . . . 250 8,031
State Street Corp. . . . . . . . . . . . . 75 7,266
---------
37,662
---------
NON-DEPOSITORY CREDIT INSTITUTIONS - 0.49%
MBNA Corp. . . . . . . . . . . . . . . . . 300 7,969
---------
PAPER & ALLIED PRODUCTS - 4.53%
Fort James Corp. . . . . . . . . . . . . . 900 21,544
Kimberly-Clark Corp. . . . . . . . . . . . 900 52,256
---------
73,800
---------
PRIMARY METAL INDUSTRIES - 0.64%
Phelps Dodge Corp. . . . . . . . . . . . . 225 10,406
---------
RESTAURANTS - 2.34%
McDonald's Corp. . . . . . . . . . . . . . 1,000 38,125
---------
RUBBER & PLASTIC FOOTWEAR - 1.87%
Nike, Inc., Class B. . . . . . . . . . . . 700 30,406
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
----------- ---------
<S> <C> <C>
SOFTWARE - 4.55%
Computer Associates International Inc . . . . . 325 $ 18,139
Oracle Corp.* . . . . . . . . . . . . . . . . . 700 55,956
---------
74,095
---------
TECHNICAL INSTRUMENTS & SUPPLIES - 7.29%
Eastman Kodak Co. . . . . . . . . . . . . . . . 600 33,563
Millipore Corp. . . . . . . . . . . . . . . . . 950 68,103
Xerox Corp. . . . . . . . . . . . . . . . . . . 650 17,184
---------
118,850
---------
TELECOMMUNICATION SERVICES - 4.35%
Telecomunicacoes Brasileiras S.A. (Telebras) -
ADR PFD (Note 7). . . . . . . . . . . . . . 600 70,913
---------
TRANSPORTATION - 8.08%
Burlington Northern Santa Fe Corp.. . . . . . . 2,900 69,963
Canadian National Railway Co. - ADR (Note 7). . 1,100 30,869
Kansas City Southern Industries, Inc. . . . . . 125 8,984
The Boeing Co.. . . . . . . . . . . . . . . . . 550 21,828
---------
131,644
---------
TOTAL COMMON STOCK
(Identified Cost $1,111,989). . . . . . . . 1,570,058
-----------
SHORT-TERM INVESTMENTS - 4.41%
Dreyfus Treasury Cash Management Fund
(Identified Cost $71,780) . . . . . . . . . 71,780 71,780
---------
TOTAL INVESTMENTS - 100.77%
(Identified Cost $1,183,769) . . . . . . . . . 1,641,838
OTHER ASSETS, LESS LIABILITIES - (0.77)%. . . . (12,503)
---------
NET ASSETS - 100% . . . . . . . . . . . . . . . $1,629,335
===========
</TABLE>
*Non-income producing security
Federal Tax Information:
At April 30, 2000, the net unrealized appreciation based on identified cost for
federal income tax purposes of $1,183,769 was as follows:
Unrealized appreciation $470,618
Unrealized depreciation (12,549)
---------
UNREALIZED APPRECIATION - NET $ 458,069
==========
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
<TABLE>
<CAPTION>
April 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $1,183,769)(Note 2) $1,641,838
Dividends receivable . . . . . . . . . . . . . . . . . . . 4,328
Receivable from investment advisor (Note 3). . . . . . . . 8,409
----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . 1,654,575
----------
LIABILITIES:
Accrued directors' fees (Note 3) . . . . . . . . . . . . . 5,707
Accrued fund accounting fees (Note 3). . . . . . . . . . . 3,672
Transfer agent fees payable (Note 3) . . . . . . . . . . . 160
Audit fee payable. . . . . . . . . . . . . . . . . . . . . 6,937
Registration and filing fees payable . . . . . . . . . . . 5,238
Other payables and accrued expenses. . . . . . . . . . . . 3,527
----------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . 25,241
----------
NET ASSETS FOR 75,406 SHARES OUTSTANDING . . . . . . . . . $1,629,334
==========
NET ASSETS CONSIST OF:
Capital stock. . . . . . . . . . . . . . . . . . . . . . . $ 754
Additional paid-in-capital . . . . . . . . . . . . . . . . 1,141,234
Undistributed net investment income. . . . . . . . . . . . 4,203
Accumulated net realized gain on investments . . . . . . . 25,074
Net unrealized appreciation on investments . . . . . . . . 458,069
----------
TOTAL NET ASSETS . . . . . . . . . . . . . . . . . . . . . $1,629,334
==========
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($1,629,334/75,406 shares). . . . . . . . . . . . . . . $ 21.61
==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
STATEMENT OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Dividends (net of foreign tax withheld, $162) . . . . $ 10,772
Interest. . . . . . . . . . . . . . . . . . . . . . . 1,432
---------
Total Investment Income . . . . . . . . . . . . . . . 12,204
---------
EXPENSES:
Management fees (Note 3). . . . . . . . . . . . . . . 6,666
Fund accounting fees (Note 3) . . . . . . . . . . . . 3,672
Directors' fees (Note 3). . . . . . . . . . . . . . . 3,591
Transfer agent fees (Note 3). . . . . . . . . . . . . 160
Audit fee . . . . . . . . . . . . . . . . . . . . . . 3,041
Registration and filing fees. . . . . . . . . . . . . 2,859
Miscellaneous . . . . . . . . . . . . . . . . . . . . 3,081
---------
Total Expenses. . . . . . . . . . . . . . . . . . . . 23,070
Less Reduction of Expenses (Note 3) . . . . . . . . . (15,074)
---------
Net Expenses. . . . . . . . . . . . . . . . . . . . . 7,996
---------
NET INVESTMENT INCOME . . . . . . . . . . . . . . . . 4,208
---------
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized gain on investments. . . . . . . . . . . 34,099
Net change in unrealized appreciation on investments. 240,985
---------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS . . . . . . . . . . . . . . . . . . 275,084
---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS. . . . . . . . . . . . . . . . . . $279,292
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS FOR THE
ENDED YEAR
04/30/00 ENDED
(UNAUDITED) 10/31/99
------------ --------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . . . . . . $ 4,208 $ 4,683
Net realized gain (loss) on investments. . . . . . . . 34,099 (375)
Net change in unrealized appreciation on investments . 240,985 164,611
------------ ----------
Net increase from operations . . . . . . . . . . . . . 279,292 168,919
------------ ----------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . . . . . (5,251) (7,164)
From net realized gain on investments -- (3,302)
------------ ----------
Total distributions to shareholders. . . . . . . . . . (5,251) (10,466)
------------ ----------
CAPITAL STOCK ISSUED AND
REPURCHASED:
Net increase from capital share transactions (Note 5). 286,347 138,747
------------ ----------
Net increase in net assets . . . . . . . . . . . . . . 560,388 297,200
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . . . 1,068,946 771,746
------------ ----------
END OF PERIOD (including undistributed net investment
income of $4,203 and $5,246, respectively). . . . . $ 1,629,334 $1,068,946
============ ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED
4/30/00 FOR THE YEAR ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96
------------ ------------------- ----------- ---------- ----------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . . . . . . $ 17.42 $ 14.46 $ 15.20 $ 11.63 $ 10.00
------------ -------------------- ---------- ---------- --------
Income from investment operations:
Net investment income (loss)* . . . . . . . . . . 0.05 0.08 0.10 (0.01) (0.02)
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . 4.23 3.07 (0.44) 3.58 1.65
------------ -------------------- ---------- ---------- --------
Total from investment operations . . . . . . . . . . 4.28 3.15 (0.34) 3.57 1.63
------------ -------------------- ---------- ---------- --------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . (0.08) (0.13) -- -- --
From net realized gain on investments . . . . . . -- (0.06) (0.40) -- --
------------ -------------------- ---------- ---------- --------
Total distributions to shareholders. . . . . . . . . (0.08) (0.19) (0.40) -- --
------------ -------------------- ---------- ---------- --------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ 21.62 $ 17.42 $ 14.46 $ 15.20 $ 11.63
============ ==================== ========== ========== ========
Total return 1 . . . . . . . . . . . . . . . . . . . 24.59% 22.04% (2.27%) 30.70% 16.30%
Ratios (to average net assets) / Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . 1.20%2 1.20% 1.20% 1.20% 1.20%
Net investment income (loss)*. . . . . . . . . . 0.63%2 0.49% 0.73% (0.09%) (0.21%)
Portfolio turnover . . . . . . . . . . . . . . . . . 55% 85% 65% 103% 78%
NET ASSETS - END OF PERIOD (000's omitted) . . . . . $ 1,629 $ 1,069 $ 772 $ 524 $ 224
============ ==================== ========== ========== ========
</TABLE>
* The investment advisor did not impose its management fee and paid a portion of
the Series' expenses. If these expenses had been incurred by the Series, and
had 1996 expenses been limited to that allowed by state securities law, the net
investment loss per share and the ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Net investment income (loss) . . ($0.14) ($0.54) ($0.43) ($0.62) ($0.14)
Ratios (to average net assets):
Expenses. . . . . . . . . . . 3.46%2 3.87% 5.17% 8.08% 2.50%
Net investment income (loss). (1.63%)2 (2.18%) (3.24%) (6.97%) (1.51%)
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
Notes to Financial Statements (unaudited)
1. ORGANIZATION
Tax Managed Series (the "Series") is a no-load diversified series of Exeter
Fund, Inc. (the "Fund"). The Fund is organized in Maryland and is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company.
The Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Currently, only Class A shares have been issued. Each class of shares is
substantially the same, except that class-specific distribution and shareholder
servicing expenses are borne by the specific class of shares to which they
relate.
The total authorized capital stock of the Fund consists of 1.7 billion shares of
common stock each having a par value of $0.01. As of April 30, 2000, 1.4
billion shares have been designated in total among 28 series, of which 37.5
million have been designated as Tax Managed Series Class A Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities, including domestic equities, foreign equities, options and
corporate bonds, listed on an exchange are valued at the latest quoted sales
price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities, will
normally be valued on the basis of evaluated bid prices provided by the Fund's
pricing service.
Securities for which representative valuations or prices are not available from
the Fund's pricing service are valued at fair value as determined in good faith
by the Advisor under procedures established by and under the general supervision
and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at amortized
cost, which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are purchased
or sold. Dividend income is recorded on the ex-dividend date. Interest income
and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the Series in the
Fund.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent that the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments, in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
The Series uses the identified cost method for determining realized gain or loss
on investments for both financial statement and federal income tax reporting
purposes.
11
<PAGE>
Notes to Financial Statements (unaudited)
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
DISTRIBUTIONS OF INCOME AND GAINS
Distributions to shareholders of net investment income are made annually.
Distributions of net realized gains are distributed annually. An additional
distribution may be necessary to avoid taxation of the Series. Distributions
are recorded on the ex-dividend date.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, character reclassification between net income and
net gains, or other tax adjustments. As a result, net investment income (loss)
and net investment gain (loss) on investment transactions for a reporting period
may differ significantly from distributions to shareholders during such period.
As a result, the Series may periodically make reclassifications among its
capital accounts without impacting the Series' net asset value. Any such
reclassifications are not reflected in the financial highlights.
OTHER
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make 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 and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement with Manning & Napier Advisors,
Inc., dba Exeter Asset Management (the "Advisor"), for which the Series pays the
Advisor a fee, computed daily and payable monthly, at an annual rate of 1.0% of
the Series' average daily net assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel
of the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and fund administration services. The salaries of all officers of
the Fund and of all Directors who are "affiliated persons" of the Fund or of the
Advisor, and all personnel of the Fund or of the Advisor performing services
relating to research, statistical and investment activities are paid by the
Advisor.
The Advisor has contractually agreed to waive its fee and, if necessary, pay
other expenses of the Series in order to maintain total expenses for the Series
at no more than 1.2% of average daily net assets each year. Accordingly, the
Advisor did not impose any of its fee and paid expenses amounting to $8,408 for
the six months ended April 30, 2000, which is reflected as a reduction of
expenses on the Statement of Operations.
The Advisor also acts as the transfer, dividend paying and shareholder servicing
agent for the Fund. For these services, the Series pays a fee which is
calculated as a percentage of the average daily net assets at an annual rate of
0.024%.
Manning & Napier Investor Services, Inc., a registered broker-dealer affiliate
of the Advisor, acts as distributor for the Fund's shares. The services of
Manning & Napier Investor Services, Inc. are provided at no additional cost to
the Series.
Effective April 2000 the Advisor became the Fund's accounting services agent.
For these services, the Fund will pay the Advisor a fee of 0.04% of each Series'
daily net assets calculated daily and payable monthly, with a minimum annual fee
of $48,000 per Series. In addition, the Fund will pay the Advisor an additional
annual fee of $10,000 for each additional class of a Series. The Advisor has
entered into an agreement with BISYS Fund Services Ohio, Inc. under which BISYS
will serve as sub-accounting services agent.
12
<PAGE>
Notes to Financial Statements (unaudited)
4. PURCHASES AND SALES OF SECURITIES
For the six months ended April 30, 2000, purchases and sales of securities,
other than United States Government securities and short-term securities, were
$954,030 and $700,747, respectively.
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of Tax Managed Series Class A Common Stock were:
For the Six Months For the Year
Ended 04/30/00 Ended 10/31/99
-------------- --------------
Shares Amount Shares Amount
------- ------ ------ ------
Sold 14,354 $292,550 31,500 $ 526,082
Reinvested 269 5,251 703 10,466
Repurchased (564) (11,454) (24,220) (397,801)
------ -------- -------- --------
Net change 14,059 $286,347 7,983 $138,747
====== ======== ======== ========
The Advisor owned 23,007 shares on April 30, 2000 and 22,907 shares on October
31, 1999.
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk
in the normal course of its investing activities to assist in managing exposure
to various market risks. These financial instruments include written options,
forward foreign currency exchange contracts, and futures contracts and may
involve, to a varying degree, elements of risk in excess of the amounts
recognized for financial statement purposes. No such investments were held by
the Series on April 30, 2000.
7. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments
involves special risks and considerations not typically associated with
investing in securities of domestic companies and the United States Government.
These risks include revaluation of currencies and future adverse political and
economic developments. Moreover, securities of foreign companies and foreign
governments may be less liquid and their prices more volatile than those of
securities of comparable domestic companies and the United States Government.
13
<PAGE>
<PAGE>
Exeter Fund, Inc.
Semi-Annual Report
April 30, 2000
PureMarkSM Series
<PAGE>
Management Discussion and Analysis (unaudited)
DEAR SHAREHOLDERS:
Over the course of the last year, the stock market has taken investors on a
roller-coaster ride. While stocks finished 1999 with strong returns, the
environment undoubtedly left people scratching their heads. Many publications
like to report the gaudy numbers of how the stock market performed over 1999,
but perhaps the most intriguing statistic we have seen about last year's market
is the price change of the median stock on the New York Stock exchange: -4.4%.
In actuality, the typical U.S. stock went down in 1999 despite the impression by
composites that are skewed by capitalization weighting.
The first four months of 2000 were not as kind to the stock market as many
investors had come to expect. Through April 30, the S&P 500 has produced a
total return of -0.8%. The broader Russell 3000 Index has fared slightly
better, returning +0.9% year-to-date. On April 14th, the Russell 3000
sustained a loss of -6.0% in just one day, driven mostly by a sharp decline in
the technology sector in which the index has more than one-third of its
exposure.
Given that the PureMarksm Series is passively managed based on a universe
composed of Russell 3000 companies, it has participated in this stock market
volatility. As such, it has also experienced returns this year close to those
of the index. The Series is currently positioned with approximately 275 stocks
so as to maintain similar characteristics to the stocks in our benchmark, the
Russell 3000 . At the same time, of course, we screen out companies that
violate our social criteria by eliminating any stocks from our pool of
securities whose primary business includes tobacco, alcohol, pornography,
gambling, or abortion. We established an initial position during the month
following the Series' inception by using a statistical optimization process that
targets similar sector and risk exposures to the benchmark, while focusing on
well-established companies. Another re-balance was performed this year in which
we also captured representation of the less-established companies in the Russell
3000 , primarily Internet stocks. We continue to monitor and perform periodic
re-balances of the Series to keep it in line with the characteristics of the
index.
The next six months may tell whether the recent stock market volatility has
tempered investors, or whether sharp disruptions in some of the high-flying
areas of the market will continue to occur. Although the Russell 3000 is a
broad index, similar dramatic downturns such as those on April 14 are likely to
have an impact on the Series. It is possible, however, that the recent market
recovery outside the technology sector reflects a step towards fundamentals and
away from the speculative atmosphere that has dominated in recent years.
We appreciate the opportunity to assist you with your socially responsible
investment needs.
Sincerely,
EXETER ASSET MANAGEMENT
1
<PAGE>
Performance Update as of April 30, 2000 (unaudited)
Exeter Fund, Inc. - PureMarkSM Series Class A
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
Inception 1 $10,550 5.50% NA
</TABLE>
Russell 3000 Total Return Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
Inception 1 $10,679 6.79% NA
</TABLE>
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Russell 3000 Total
Date PureMarkSM Series Class A Return Index
<S> <C> <C>
02/22/00 10,000 10,000
02/29/00 10,400 10,265
03/31/00 11,230 11,069
04/30/00 10,550 10,679
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - PureMarkSM Series
Class A from its inception (2/22/00) to present (4/30/00) as compared to the
Russell 3000 Total Return Index for the same time period. 2
Exeter Fund, Inc. - PureMarkSM Series Class E
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
Inception 1 $10,347 3.47% NA
</TABLE>
Russell 3000 Total Return Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
Inception 1 $10,943 9.43% NA
</TABLE>
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Russell 3000 Total
Date PureMarkSM Series Class E Return Index
<S> <C> <C>
11/10/99 10,000 10,000
11/30/99 9,820 10,197
12/31/99 10,297 10,847
01/31/00 9,967 10,422
02/29/00 10,187 10,519
03/31/00 10,778 11,343
04/30/00 10,347 10,943
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - PureMarkSM Series
Class E from its inception (11/10/99) to present (4/30/00) as compared to the
Russell 3000 Total Return Index for the same time period. 2
1 Class A and Index performance are calculated from February 22, 2000, the
Class's inception date. Class E and Index performance are calculated from
November 10, 1999, the Class's inception date. The Class's performance is
historical and may not be indicative of future results.
2 The Russell 3000 Total Return Index is an unmanaged index that consists of
approximately 3000 small-capitalization stocks. Members of the Index represent
only U.S. common stocks that are invested in the U.S. equity markets. The Index
returns are based on a market capitalization weighted average of relative price
changes of the component stocks plus dividends whose reinvestments are
compounded daily. Unlike the Class returns, the Index returns do not reflect any
fees or expenses.
2
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
COMMON STOCK - 101.03%
<S> <C> <C>
AIR TRANSPORTATION - 0.63%
Alaska Air Group, Inc.* . . . . . . . . . . . . . . . . . 200 $ 5,750
FedEx Corp.*. . . . . . . . . . . . . . . . . . . . . . . 1,075 40,514
---------
46,264
---------
APPAREL & ACCESSORY STORES - 0.67%
Claire's Stores, Inc. . . . . . . . . . . . . . . . . . . 400 7,375
Intimate Brands Inc.. . . . . . . . . . . . . . . . . . . 1,050 40,425
United Retail Group, Inc.*. . . . . . . . . . . . . . . . 225 1,842
---------
49,642
---------
BUSINESS SERVICES - 13.01%
ADVERTISING AGENCIES - 1.20%
DoubleClick, Inc.*. . . . . . . . . . . . . . . . . . . 75 5,691
Interpublic Group of Companies, Inc.. . . . . . . . . . 800 32,800
Omnicom Group, Inc. . . . . . . . . . . . . . . . . . . 550 50,084
---------
88,575
---------
COMPUTER INTEGRATED SYSTEMS DESIGN - 2.21%
Autodesk, Inc.. . . . . . . . . . . . . . . . . . . . . 50 1,919
BroadVision, Inc.*. . . . . . . . . . . . . . . . . . . 475 20,870
Cognex Corp.* . . . . . . . . . . . . . . . . . . . . . 450 25,594
Computer Sciences Corp.*. . . . . . . . . . . . . . . . 700 57,094
Radiant Systems, Inc.*. . . . . . . . . . . . . . . . . 150 2,794
Sun Microsystems, Inc.* . . . . . . . . . . . . . . . . 600 55,163
---------
163,434
---------
COMPUTER PROGRAMMING SERVICES - 1.09%
Network Solutions, Inc.*. . . . . . . . . . . . . . . . 250 37,000
RealNetworks, Inc.* . . . . . . . . . . . . . . . . . . 325 15,478
VeriSign, Inc.* . . . . . . . . . . . . . . . . . . . . 200 27,875
---------
80,353
---------
COMPUTER PROGRAMMING & DATA PROCESSING SERVICES - 0.64%
Ceridian Corp.* . . . . . . . . . . . . . . . . . . . . 2,200 47,712
---------
COMPUTER PROCESSING & DATA PREPARATION SERVICES - 2.10%
Automatic Data Processing, Inc. . . . . . . . . . . . . 1,050 56,503
FactSet Research Systems, Inc.. . . . . . . . . . . . . 325 9,344
First Data Corp.. . . . . . . . . . . . . . . . . . . . 1,400 68,163
ProBusiness Services, Inc.* . . . . . . . . . . . . . . 800 21,100
---------
155,110
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
BUSINESS SERVICES (continued)
<S> <C> <C>
PREPACKAGED SOFTWARE - 2.51%
BEA Systems, Inc.*. . . . . . . . . . . . . 550 $ 26,538
Computer Task Group, Inc. . . . . . . . . . 575 4,887
Microsoft Corp.*. . . . . . . . . . . . . . 600 41,850
MicroStrategy, Inc.*. . . . . . . . . . . . 150 3,881
Siebel Systems, Inc.* . . . . . . . . . . . 375 46,075
SPSS, Inc.* . . . . . . . . . . . . . . . . 100 2,850
VERITAS Software Corp.* . . . . . . . . . . 418 44,837
Vignette Corp.* . . . . . . . . . . . . . . 300 14,456
---------
185,374
---------
MISCELLANEOUS - 3.26%
ADVO, Inc.* . . . . . . . . . . . . . . . . 100 3,000
American Management Systems, Inc.*. . . . . 200 7,400
At Home Corp - Series A*. . . . . . . . . . 950 17,694
CMGI, Inc.* . . . . . . . . . . . . . . . . 250 17,812
EarthLink, Inc.*. . . . . . . . . . . . . . 425 8,022
eBay, Inc.* . . . . . . . . . . . . . . . . 225 35,817
Electronics for Imaging, Inc.*. . . . . . . 950 49,638
InfoSpace, Inc.*. . . . . . . . . . . . . . 300 21,544
Inktomi Corp.*. . . . . . . . . . . . . . . 200 30,788
Marketing Services Group, Inc.* . . . . . . 175 1,214
SoftNet Systems, Inc.*. . . . . . . . . . . 150 2,250
Synopsys, Inc.* . . . . . . . . . . . . . . 1,100 46,200
---------
241,379
---------
961,937
---------
CHEMICAL & ALLIED PRODUCTS - 9.35%
BIOLOGICAL PRODUCTS - 1.07%
Amgen, Inc.*. . . . . . . . . . . . . . . . 1,000 56,000
Aviron* . . . . . . . . . . . . . . . . . . 975 23,461
---------
79,461
---------
SOAP, DETERGENTS & CLEANING PRODUCTS- 3.05%
Alberto Culver Co. - Class B. . . . . . . . 475 11,222
Clorox Co.. . . . . . . . . . . . . . . . . 925 33,994
Colgate-Palmolive Co. . . . . . . . . . . . 825 47,128
Ecolab, Inc.. . . . . . . . . . . . . . . . 1,725 67,383
Gillette Co.. . . . . . . . . . . . . . . . 1,100 40,700
Proctor & Gamble Co.. . . . . . . . . . . . 425 25,341
---------
225,768
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
CHEMICALS & ALLIED PRODUCTS (continued)
<S> <C> <C>
PHARMACEUTICAL PREPARATIONS - 4.20%
Abbott Laboratories . . . . . . . . . . . . . . . 1,800 $ 69,188
Eli Lilly & Co. . . . . . . . . . . . . . . . . . 975 75,380
King Pharmaceuticals, Inc.. . . . . . . . . . . . 613 30,267
Merck & Co., Inc. . . . . . . . . . . . . . . . . 950 66,025
Pfizer, Inc.. . . . . . . . . . . . . . . . . . . 1,650 69,506
---------
310,366
---------
MISCELLANEOUS - 1.03%
Church & Dwight Co., Inc. . . . . . . . . . . . . 275 4,916
H.B. Fuller Co. . . . . . . . . . . . . . . . . . 225 8,648
PPG Industries, Inc.. . . . . . . . . . . . . . . 1,150 62,531
---------
76,095
---------
691,690
---------
CHILD CARE SERVICES - 0.07%
Bright Horizons Family Solutions, Inc.* . . . . . . 300 5,400
---------
COMMUNICATIONS - 8.63%
RADIO & TELEVISION BROADCASTING STATIONS - 1.20%
Allegiance Telecom, Inc.*. . . . . . . . . . . . 287 20,305
Price Communications Corp.*. . . . . . . . . . . 400 8,100
United Television, Inc.. . . . . . . . . . . . . 25 3,372
Univision Communications, Inc.*. . . . . . . . . 525 57,356
---------
89,133
---------
TELEPHONE COMMUNICATIONS - 5.96%
Bell Atlantic Corp.. . . . . . . . . . . . . . . 475 28,144
BellSouth Corp.. . . . . . . . . . . . . . . . . 625 30,430
Broadwing, Inc.* . . . . . . . . . . . . . . . . 800 22,650
Covad Communications Group, Inc.*. . . . . . . . 338 9,366
Exodus Communications, Inc.* . . . . . . . . . . 300 26,531
GTE Corp.. . . . . . . . . . . . . . . . . . . . 525 35,569
Metromedia Fiber Network, Inc.*. . . . . . . . . 650 20,069
NEXTLINK Communications, Inc.* . . . . . . . . . 325 27,402
RCN Corp.* . . . . . . . . . . . . . . . . . . . 925 26,478
SBC Communications, Inc. . . . . . . . . . . . . 675 29,573
Sprint Corp. (PCS Group)*. . . . . . . . . . . . 750 41,250
Time Warner Telecom, Inc. - Class A* . . . . . . 350 19,162
U.S. WEST, Inc.. . . . . . . . . . . . . . . . . 400 28,475
VoiceStream Wireless Corp.*. . . . . . . . . . . 407 40,293
Western Wireless Corp.*. . . . . . . . . . . . . 225 11,180
Winstar Communications, Inc.*. . . . . . . . . . 1,112 44,341
---------
440,913
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
COMMUNICATIONS (continued)
<S> <C> <C>
MISCELLANEOUS - 1.47%
Level 3 Communications, Inc.*. . . 500 $ 44,500
Liberty Digital, Inc.* . . . . . . 425 13,600
McLeodUSA, Inc. - Class A* . . . . 1,575 39,375
NTL, Inc.* . . . . . . . . . . . . 143 10,939
---------
108,414
---------
638,460
---------
DEPOSITORY INSTITUTIONS - 7.55%
NATIONAL COMMERCIAL BANKS - 5.44%
Bank of America Corp. . . . . . . . 850 41,650
Bank of New York Company, Inc.. . . 1,200 49,275
BOK Financial Corp.*. . . . . . . . 300 4,922
Chase Manhattan Corp. . . . . . . . 500 36,031
Comerica, Inc.. . . . . . . . . . . 425 18,009
First Charter Corp. . . . . . . . . 150 2,081
Firstar Corp. . . . . . . . . . . . 625 15,547
FleetBoston Financial Corp. . . . . 800 28,350
KeyCorp . . . . . . . . . . . . . . 600 11,100
Mellon Financial Corp.. . . . . . . 550 17,669
Old National Bancorp. . . . . . . . 650 21,206
Second Bancorp, Inc.. . . . . . . . 125 2,133
Simmons First National Corp.. . . . 100 2,350
State Street Corp.. . . . . . . . . 625 60,547
SunTrust Banks, Inc.. . . . . . . . 725 36,794
United National Bancorp . . . . . . 125 2,445
U.S. Bancorp. . . . . . . . . . . . 525 10,664
U.S. Trust Corp.. . . . . . . . . . 100 15,388
Wachovia Corp.. . . . . . . . . . . 175 10,970
Westamerica Bancorporation. . . . . 600 15,038
---------
402,169
---------
STATE COMMERCIAL BANKS - 1.37%
Century South Banks, Inc. . . . . . 100 2,163
First Virginia Banks, Inc.. . . . . 525 19,163
Great Southern Bancorp, Inc.. . . . 25 447
Hudson United Bancorp . . . . . . . 281 6,340
Investors Financial Services Corp.. 175 14,284
Mid-State Bankshares. . . . . . . . 125 3,281
North Fork Bancorporation, Inc. . . 175 2,833
One Valley Bancorp, Inc.. . . . . . 350 11,878
Provident Bankshares Corp.. . . . . 551 8,234
Silicon Valley Bancshares*. . . . . 275 16,981
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
DEPOSITORY INSTITUTIONS (continued)
<S> <C> <C>
STATE COMMERCIAL BANKS (continued)
West Coast Bancorp. . . . . . . . . . . 300 $ 3,113
Wilmington Trust Corp.. . . . . . . . . 275 12,684
---------
101,401
---------
MISCELLANEOUS - 0.74%
Citigroup, Inc. . . . . . . . . . . . . 875 52,008
St. Francis Capital Corp. . . . . . . . 175 2,483
---------
54,491
---------
558,061
---------
ELECTRIC, GAS & SANITARY SERVICES - 2.84%
COMBINED SERVICES - 0.09%
PG&E Corp.. . . . . . . . . . . . . . . 250 6,484
---------
ELECTRIC SERVICE - 2.41%
AES Corp.*. . . . . . . . . . . . . . . 75 6,745
Ameren Corp.. . . . . . . . . . . . . . 450 16,509
Calpine Corp.*. . . . . . . . . . . . . 200 18,300
CMP Group, Inc. . . . . . . . . . . . . 75 2,170
Constellation Energy Group. . . . . . . 700 23,144
Dominion Resources, Inc.. . . . . . . . 375 16,875
DTE Energy Co.. . . . . . . . . . . . . 375 12,234
Duke Energy Corp. . . . . . . . . . . . 125 7,188
FirstEnergy Corp. . . . . . . . . . . . 1,150 29,253
Kansas City Power & Light Co. . . . . . 700 17,981
Northern States Power Co. . . . . . . . 375 8,180
Southern Co.. . . . . . . . . . . . . . 525 13,092
Texas Utilities Co. . . . . . . . . . . 200 6,738
---------
178,409
---------
GAS PRODUCTION & DISTRIBUTION - 0.17%
NICOR, Inc. . . . . . . . . . . . . . . 225 7,622
Williams Companies, Inc.. . . . . . . . 125 4,664
---------
12,286
---------
WATER SUPPLY - 0.17%
California Water Service Group. . . . . 100 2,331
E'Town Corp.. . . . . . . . . . . . . . 50 3,259
SJW Corp. . . . . . . . . . . . . . . . 25 2,894
United Water Resources, Inc.. . . . . . 125 4,344
---------
12,828
---------
210,007
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
ELECTRONICS & ELECTRICAL EQUIPMENT - 12.37%
<S> <C> <C>
COMMUNICATIONS EQUIPMENT - 2.06%
CTC Communications Group, Inc.*. . . . . 237 $ 7,999
Lucent Technologies, Inc.. . . . . . . . 900 55,969
Motorola, Inc. . . . . . . . . . . . . . 375 44,648
Tellabs, Inc.* . . . . . . . . . . . . . 800 43,850
---------
152,466
---------
COMPONENTS & ACCESSORIES - 9.14%
Analog Devices, Inc.*. . . . . . . . . . 725 55,689
Broadcom Corp.*. . . . . . . . . . . . . 275 47,403
Conexant Systems, Inc.*. . . . . . . . . 375 22,453
Cree Research, Inc.* . . . . . . . . . . 100 14,550
CTS Corp.. . . . . . . . . . . . . . . . 475 29,955
Dionex Corp.*. . . . . . . . . . . . . . 300 10,912
DuPont Photomasks, Inc.* . . . . . . . . 300 16,819
E-Tek Dynamics, Inc.*. . . . . . . . . . 150 30,712
Intel Corp.. . . . . . . . . . . . . . . 450 57,066
JDS Uniphase Corp.*. . . . . . . . . . . 475 49,281
LSI Logic Corp.* . . . . . . . . . . . . 750 46,875
Maxim Integrated Products, Inc.* . . . . 875 56,711
Photronics, Inc.*. . . . . . . . . . . . 50 1,666
Raytheon Co. Class B . . . . . . . . . . 950 21,078
REMEC, Inc.. . . . . . . . . . . . . . . 675 25,608
R F Micro Devices, Inc.* . . . . . . . . 425 44,227
SDL, Inc.* . . . . . . . . . . . . . . . 100 19,500
Silicon Valley Group, Inc.*. . . . . . . 1,150 32,775
Texas Instruments, Inc.. . . . . . . . . 350 57,006
Vitesse Semiconductor Corp.* . . . . . . 525 35,733
---------
676,019
---------
MISCELLANEOUS - 1.17%
Emerson Electric Co. . . . . . . . . . . 725 39,784
Energizer Holdings, Inc.*. . . . . . . . 425 7,251
Salton, Inc.*. . . . . . . . . . . . . . 75 3,220
Thomas & Betts Corp. . . . . . . . . . . 1,175 36,205
---------
86,460
---------
914,945
---------
FABRICATED METAL PRODUCTS - 0.69%
Fortune Brands, Inc.. . . . . . . . . . . . 975 24,375
Masco Corp. . . . . . . . . . . . . . . . . 1,200 26,925
---------
51,300
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
<S> <C> <C>
FOOD & KINDRED PRODUCTS - 3.54%
Bestfoods. . . . . . . . . . . . . . . . . . 800 $ 40,200
Campbell Soup Co.. . . . . . . . . . . . . . 625 16,250
Coca-Cola Co.. . . . . . . . . . . . . . . . 725 34,120
ConAgra, Inc.. . . . . . . . . . . . . . . . 1,350 25,481
General Mills, Inc.. . . . . . . . . . . . . 300 10,912
H.J. Heinz Co. . . . . . . . . . . . . . . . 1,050 35,700
McCormick & Co., Inc.. . . . . . . . . . . . 600 18,713
PepsiCo, Inc.. . . . . . . . . . . . . . . . 1,450 53,197
Ralston-Ralston Purina Group . . . . . . . . 1,275 22,552
Tootsie Roll Industries, Inc.. . . . . . . . 153 4,714
---------
261,839
---------
GENERAL MERCHANDISE STORES - 2.11%
BJ's Wholesale Club, Inc.* . . . . . . . . . 1,400 49,612
May Department Stores Co.. . . . . . . . . . 800 22,000
Target Corp. . . . . . . . . . . . . . . . . 650 43,266
Wal-Mart Stores, Inc.. . . . . . . . . . . . 750 41,531
---------
156,409
---------
GROCERY STORES - 1.23%
SUPERVALU, Inc.. . . . . . . . . . . . . . . 1,625 33,617
SYSCO Corp.. . . . . . . . . . . . . . . . . 975 36,685
Weis Markets, Inc. . . . . . . . . . . . . . 625 20,781
---------
91,083
---------
HOME HEALTH CARE SERVICES- 0.56%
Hooper Holmes, Inc.. . . . . . . . . . . . . 2,400 41,700
---------
INDUSTRIAL & COMMERCIAL MACHINERY - 10.29%
COMPUTER & OFFICE EQUIPMENT - 7.54%
Cisco Systems, Inc.* . . . . . . . . . . . 850 58,929
Dell Computer Corp.* . . . . . . . . . . . 800 40,100
EMC Corp.* . . . . . . . . . . . . . . . . 450 62,522
Gateway, Inc.* . . . . . . . . . . . . . . 950 52,487
Hewlett-Packard Co.. . . . . . . . . . . . 425 57,375
International Business Machine Corp. (IBM) 375 41,859
Lexmark Internation Group, Inc.* . . . . . 475 56,050
Micron Electronics, Inc.*. . . . . . . . . 475 5,077
Minnesota Mining & Manufacturing Co. (3M). 350 30,275
Pitney Bowes, Inc. . . . . . . . . . . . . 625 25,547
Safeguard Scientifics, Inc.* . . . . . . . 675 28,181
Seagate Technology, Inc.*. . . . . . . . . 925 47,002
Solectron Corp.* . . . . . . . . . . . . . 1,125 52,664
---------
558,068
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
<S> <C> <C>
INDUSTRIAL & COMMERCIAL MACHINERY (continued)
MISCELLANEOUS - 2.75%
Applied Materials, Inc.* . . . . . . . . . . . 550 $ 55,997
Black & Decker Corp. . . . . . . . . . . . . . 750 31,547
Kulicke & Soffa Industries, Inc.*. . . . . . . 625 48,945
United Technologies Corp.. . . . . . . . . . . 1,075 66,852
---------
203,341
---------
761,409
---------
INSURANCE AGENTS & BROKERS - 0.61%
Brown & Brown, Inc.. . . . . . . . . . . . . . . 150 6,019
Marsh & McLennan Co., Inc. . . . . . . . . . . . 400 39,425
---------
45,444
---------
LIFE INSURANCE CARRIERS - 0.35%
Cigna Corp.. . . . . . . . . . . . . . . . . . . 250 19,938
Liberty Corp.. . . . . . . . . . . . . . . . . . 175 5,742
---------
25,680
---------
MINING - 1.49%
Arch Coal, Inc.. . . . . . . . . . . . . . . . . 313 1,682
Enron Corp.. . . . . . . . . . . . . . . . . . . 600 41,813
Vastar Resources, Inc. . . . . . . . . . . . . . 825 66,516
---------
110,011
---------
MISCELLANEOUS MANUFACTURING INDUSTRIES - 0.02%
PubliCARD, Inc.* . . . . . . . . . . . . . . . . 275 1,667
---------
MOTION PICTURE PRODUCTION & DISTRIBUTION - 1.70%
AT&T Corp. - Liberty Media Group*. . . . . . . . 1,100 54,931
Macrovision Corp.* . . . . . . . . . . . . . . . 75 3,666
Walt Disney Co.. . . . . . . . . . . . . . . . . 1,550 67,134
---------
125,731
---------
MOTOR VEHICLE DEALERS (USED ONLY) - 0.10%
Copart, Inc.*. . . . . . . . . . . . . . . . . . 425 7,331
---------
MULTI-LINE INSURANCE CARRIERS - 1.37%
Allmerica Financial Corp.. . . . . . . . . . . . 500 27,062
American International Group, Inc. . . . . . . . 400 43,875
Hartford Financial Services Group, Inc.. . . . . 400 20,875
HCC Insurance Holdings, Inc. . . . . . . . . . . 350 4,113
HSB Group, Inc.. . . . . . . . . . . . . . . . . 175 5,075
---------
101,000
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
10
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
<S> <C> <C>
NON-DEPOSITORY CREDIT INSTITUTIONS - 1.96%
American Express Co. . . . . . . . . . . . . . . . . . 175 $ 26,261
Associates First Capital Corp. . . . . . . . . . . . . 1,275 28,289
Fannie Mae . . . . . . . . . . . . . . . . . . . . . . 375 22,617
FiNet.com, Inc.* . . . . . . . . . . . . . . . . . . . 250 219
Freddie Mac. . . . . . . . . . . . . . . . . . . . . . 375 17,227
Household International, inc.. . . . . . . . . . . . . 100 4,175
MBNA Corp. . . . . . . . . . . . . . . . . . . . . . . 1,750 46,484
---------
145,272
---------
PERSONAL SERVICES - BEAUTY SHOPS - 0.10%
Regis Corp.. . . . . . . . . . . . . . . . . . . . . . 650 7,597
---------
PETROLEUM REFINING & RELATED INDUSTRIES - 2.88%
Ashland, Inc.. . . . . . . . . . . . . . . . . . . . . 1,275 43,509
Chevron Corp.. . . . . . . . . . . . . . . . . . . . . 700 59,587
Exxon Mobil Corp.. . . . . . . . . . . . . . . . . . . 797 61,917
Texaco, Inc. . . . . . . . . . . . . . . . . . . . . . 875 43,313
WD-40 Co.. . . . . . . . . . . . . . . . . . . . . . . 225 4,486
---------
212,812
---------
PRIMARY METAL INDUSTRIES - 1.17%
CommScope, Inc.* . . . . . . . . . . . . . . . . . . . 1,375 65,313
Tredegar Corp. . . . . . . . . . . . . . . . . . . . . 825 21,295
---------
86,608
---------
PRINTING & PUBLISHING - 1.57%
Gannett Co., Inc.. . . . . . . . . . . . . . . . . . . 500 31,938
McGraw-Hill Companies, Inc.. . . . . . . . . . . . . . 900 47,250
Washington Post Co. - Class B. . . . . . . . . . . . . 75 36,600
---------
115,788
---------
PROFESSIONAL & COMMERCIAL EQUIPMENT & SOFTWARE - 0.13%
Insight Enterprises, Inc.* . . . . . . . . . . . . . . 225 9,408
---------
PUBLIC BUILDING & RELATED FURNITURE - 0.79%
Johnson Controls, Inc. . . . . . . . . . . . . . . . . 925 58,564
---------
RAILROADS - 0.23%
Burlington Northern Santa Fe Corp. . . . . . . . . . . 700 16,888
---------
REAL ESTATE INVESTMENT TRUSTS - 0.23%
Boston Properties, Inc.. . . . . . . . . . . . . . . . 475 16,566
MGI Properties, Inc. . . . . . . . . . . . . . . . . . 275 636
---------
17,202
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
------- ---------
<S> <C> <C>
RESEARCH, MANAGEMENT AND RELATED SERVICES - 0.09%
Quest Diagnostics, Inc.* . . . . . . . . . . . . . . . . . . 75 $ 4,364
Xceed, Inc.* . . . . . . . . . . . . . . . . . . . . . . . . 175 2,406
---------
6,770
---------
RESTAURANTS - 0.43%
McDonald's Corp. . . . . . . . . . . . . . . . . . . . . . . 825 31,453
---------
RETAIL - MISCELLANEOUS - 1.86%
Amazon.com, Inc.*. . . . . . . . . . . . . . . . . . . . . . 325 17,936
Costco Wholesale Corp.*. . . . . . . . . . . . . . . . . . . 875 47,305
e4L, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . 425 584
Home Depot, Inc. . . . . . . . . . . . . . . . . . . . . . . 650 36,441
Walgreen Co. . . . . . . . . . . . . . . . . . . . . . . . . 1,250 35,156
---------
137,422
---------
RUBBER & PLASTIC FOOTWEAR - 0.25%
NIKE, Inc. - Class B . . . . . . . . . . . . . . . . . . . . 425 18,461
---------
SECURITIES & COMMODITY BROKER, DEALERS & SERVICES - 1.82%
Bear Stearns Companies, Inc. . . . . . . . . . . . . . . . . 750 32,156
John Nuveen Co. - Class A. . . . . . . . . . . . . . . . . . 100 3,988
J.P. Morgan & Co., Inc.. . . . . . . . . . . . . . . . . . . 225 28,884
Morgan Stanley Dean Witter & Co. . . . . . . . . . . . . . . 575 44,131
Merrill Lynch & Co., Inc.. . . . . . . . . . . . . . . . . . 250 25,484
Siebert Financial Corp.. . . . . . . . . . . . . . . . . . . 25 236
---------
134,879
---------
TECHNICAL INSTRUMENTS & SUPPLIES - 4.97%
SURGICAL, MEDICAL & DENTAL INSTRUMENTS & SUPPLIES - 3.17%
Baxter International, Inc.. . . . . . . . . . . . . . . . 975 63,497
Becton, Dickinson & Co. . . . . . . . . . . . . . . . . . 1,250 32,031
Edwards Lifesciences Corp.* . . . . . . . . . . . . . . . 195 2,925
Guidant Corp.*. . . . . . . . . . . . . . . . . . . . . . 900 51,638
Medtronic, Inc. . . . . . . . . . . . . . . . . . . . . . 1,150 59,728
Techne Corp.* . . . . . . . . . . . . . . . . . . . . . . 350 24,894
---------
234,713
---------
MISCELLANEOUS - 1.80%
Cymer, Inc.*. . . . . . . . . . . . . . . . . . . . . . . 275 10,742
Danaher Corp. . . . . . . . . . . . . . . . . . . . . . . 875 49,984
Eastman Kodak Co. . . . . . . . . . . . . . . . . . . . . 375 20,977
Primex Technologies, Inc. . . . . . . . . . . . . . . . . 450 9,900
Xerox Corp. . . . . . . . . . . . . . . . . . . . . . . . 1,575 41,639
---------
133,242
---------
367,955
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 2)
----------- ---------
<S> <C> <C>
TRANSPORTATION EQUIPMENT - 3.37%
AIRCRAFT & PARTS - 1.27%
General Dynamics Corp.. . . . . . . . . . 625 $ 36,562
B.F. Goodrich Co. . . . . . . . . . . . . 50 1,594
Honeywell International, Inc. . . . . . . 1,000 56,000
---------
94,156
---------
MOTOR VEHICLE PARTS & ACCESSORIES - 2.01%
Delphi Automotive Systems Corp. . . . . . 575 10,997
Ford Motor Co.. . . . . . . . . . . . . . 575 31,445
Genuine Parts Co. . . . . . . . . . . . . 1,300 34,125
ITT Industries, Inc.. . . . . . . . . . . 1,450 45,766
Rockwell International Corp.. . . . . . . 675 26,578
---------
148,911
---------
MISCELLANEOUS - 0.09%
Fleetwood Enterprises, Inc. . . . . . . . 425 6,216
---------
249,283
---------
TOTAL COMMON STOCK
(Identified Cost $7,490,694) . . . . . . 7,473,372
---------
SHORT-TERM INVESTMENTS - 0.44%
Dreyfus Treasury Cash Management Fund
(Identified Cost $32,875). . . . . . . . 32,875 32,875
---------
TOTAL INVESTMENTS - 101.47%
(Identified Cost $7,523,569). . . . . . . . 7,506,247
OTHER ASSETS, LESS LIABILITIES - (1.47)% . . (108,946)
-----------
NET ASSETS - 100%. . . . . . . . . . . . . . $7,397,301
===========
</TABLE>
* Non-income producing security.
Federal Tax Information:
At April 30, 1999, the net unrealized depreciation based on identified cost for
federal income tax purposes of $7,523,569 was as follows:
Unrealized appreciation $ 632,369
Unrealized depreciation (649,691)
--------------
UNREALIZED DEPRECIATION - NET $ ( 17,322)
==============
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (unaudited)
<TABLE>
<CAPTION>
April 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $7,523,569)(Note 2) $7,506,247
Dividends receivable . . . . . . . . . . . . . . . . . . . 5,452
-----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . 7,511,699
-----------
LIABILITIES:
Accrued management fees (Note 3) . . . . . . . . . . . . . 565
Accrued fund accounting fees (Note 3). . . . . . . . . . . 4,449
Accrued directors' fees (Note 3) . . . . . . . . . . . . . 3,394
Accrued distribution and service fees (Note 3) . . . . . . 1,569
Transfer agent fees payable (Note 3) . . . . . . . . . . . 668
Payable for fund shares repurchased. . . . . . . . . . . . 100,000
Other payables and accrued expenses. . . . . . . . . . . . 3,753
-----------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . 127,756
-----------
NET ASSETS FOR 715,727 SHARES OUTSTANDING. . . . . . . . . $7,397,301
===========
NET ASSETS CONSIST OF:
Capital stock. . . . . . . . . . . . . . . . . . . . . . . $ 7,157
Additional paid-in-capital . . . . . . . . . . . . . . . . 7,306,525
Undistributed net investment income. . . . . . . . . . . . 9,359
Accumulated net realized gain on investments . . . . . . . 91,582
Net unrealized depreciation on investments . . . . . . . . (17,322)
-----------
TOTAL NET ASSETS . . . . . . . . . . . . . . . . . . . . . $7,397,301
===========
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($16,900/1,602 shares). . . . . . . . . . . . . . . . . $ 10.55
===========
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS E
($7,380,401/714,125 shares) . . . . . . . . . . . . . . $ 10.33
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
STATEMENT OF OPERATIONS (unaudited)
<TABLE>
<CAPTION>
FOR THE PERIOD ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Dividends . . . . . . . . . . . . . . . . . . . . . . $ 34,751
Interest. . . . . . . . . . . . . . . . . . . . . . . 9,504
---------
Total Investment Income . . . . . . . . . . . . . . . 44,255
---------
EXPENSES:
Management fees (Note 3). . . . . . . . . . . . . . . 13,923
Fund accounting fees (Note 3) . . . . . . . . . . . . 4,449
Directors' fees (Note 3). . . . . . . . . . . . . . . 3,394
Transfer agent fees (Note 3). . . . . . . . . . . . . 668
Distribution and service fees (Class E) (Note 3). . . 6,999
Audit fee . . . . . . . . . . . . . . . . . . . . . . 4,477
Custody fees. . . . . . . . . . . . . . . . . . . . . 2,827
Miscellaneous . . . . . . . . . . . . . . . . . . . . 3,112
---------
Total Expenses. . . . . . . . . . . . . . . . . . . . 39,849
Less Reduction of Expenses (Note 3) . . . . . . . . . (13,358)
---------
Net Expenses. . . . . . . . . . . . . . . . . . . . . 26,491
---------
NET INVESTMENT INCOME . . . . . . . . . . . . . . . . 17,764
---------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized gain on investments. . . . . . . . . . . 91,582
Net change in unrealized depreciation on investments. (17,322)
---------
NET REALIZED AND UNREALIZED GAIN (LOSS )
ON INVESTMENTS . . . . . . . . . . . . . . . . . . 74,260
---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS. . . . . . . . . . . . . . . . . . $ 92,024
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (unaudited)
<TABLE>
<CAPTION>
FOR THE
PERIOD
ENDED
4/30/00
-----------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C>
Net investment income. . . . . . . . . . . . . . . . . $ 17,764
Net realized gain on investments . . . . . . . . . . . 91,582
Net change in unrealized depreciation on investments . (17,322)
-----------
Net increase (decrease) from operations. . . . . . . . 92,024
-----------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income - Class E . . . . . . . . . (8,405)
-----------
CAPITAL STOCK ISSUED AND
REPURCHASED:
Net increase from capital share transactions (Note 5). 7,313,682
-----------
Net increase in net assets . . . . . . . . . . . . . . 7,397,301
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . . . --
-----------
END OF PERIOD (including undistributed net investment
income of $9,359). . . . . . . . . . . . . . . . . $7,397,301
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
FINANCIAL HIGHLIGHTS (unaudited)
<TABLE>
<CAPTION>
CLASS A CLASS E
FOR THE FOR THE
PERIOD 2/23/00+ PERIOD11/10/99+
TO 04/30/00 TO 04/30/00
----------------- -----------------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . . . . . . $ 10.00 $ 10.00
----------------- -----------------
Income from investment operations:
Net investment income . . . . . . . . . . . . . . 0.02 0.03
Net realized and unrealized gain
on investments . . . . . . . . . . . . . . . . 0.53 0.32
----------------- -----------------
Total from investment operations . . . . . . . . . . 0.55 0.35
----------------- -----------------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . -- (0.02)
----------------- -----------------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ 10.55 $ 10.33
================= =================
Total return 1 . . . . . . . . . . . . . . . . . . . 5.50% 3.47%
Ratios (to average net assets) / Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . 0.70%2 0.95%2
Net investment income *. . . . . . . . . . . . . 0.66%2 0.63%2
Portfolio turnover . . . . . . . . . . . . . . . . . 20% 20%
NET ASSETS - END OF PERIOD (000's omitted) . . . . . $ 17 $ 7,380
================= =================
</TABLE>
* The investment advisor did not impose all or a portion of its management fee.
If these expenses had been incurred by the Series the net investment income per
share and the ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
Net investment income . . . . . $ 0.01 $ 0.01
Ratios (to average net assets):
Expenses . . . . . . . . . . 1.10%2 1.42%2
Net investment income. . . . 0.26%2 0.16%2
</TABLE>
+ Commencement of operations.
1 Represents aggregate total return for the period indicated.
2 Annualized.
The accompanying notes are an integral part of the financial statements.
17
<PAGE>
Notes to Financial Statements (unaudited)
1. ORGANIZATION
PureMarkSM Series (the "Series") is a no-load diversified series of Exeter Fund,
Inc. (the "Fund"). The Fund is organized in Maryland and is registered under
the Investment Company Act of 1940, as amended, as an open-end management
investment company.
The Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Each class of shares is substantially the same, except that class-specific
distribution and shareholder servicing expenses are borne by the specific class
of shares to which they relate. Currently, Class A and Class E are offered.
Currently, Class A and Class E are offered.
The total authorized capital stock of the Fund consists of 1.7 billion shares of
common stock each having a par value of $0.01. As of April 30, 2000, 1.4
billion shares have been designated in total among 28 series, of which 37.5
million have been designated as PureMarkSM Series Class A Common Stock and 2.5
million have been designated as PureMarkSM Series Class E.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities, including domestic equities, foreign equities, options and
corporate bonds, listed on an exchange are valued at the latest quoted sales
price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities, will
normally be valued on the basis of evaluated bid prices provided by the Fund's
pricing service.
Securities for which representative valuations or prices are not available from
the Fund's pricing service are valued at fair value as determined in good faith
by the Advisor under procedures established by and under the general supervision
and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at amortized
cost, which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are purchased
or sold. Dividend income is recorded on the ex-dividend date. Interest income
and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the Series in the
Fund.
Income, expenses (other than class specific expenses), and realized and
unrealized gains and losses are prorated among the classes based on the relative
net assets of each class. Class specific expenses are directly charged to that
class. Currently, class specific expenses are limited to expenses incurred
under the Distribution Plan.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent that the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments, in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
18
<PAGE>
Notes to Financial Statements (unaudited)
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
FEDERAL INCOME TAXES (continued)
The Series uses the identified cost method for determining realized gain or loss
on investments for both financial statement and federal income tax reporting
purposes.
DISTRIBUTIONS OF INCOME AND GAINS
Distributions to shareholders of net investment income are made annually.
Distributions of net realized gains are distributed annually. An additional
distribution may be necessary to avoid taxation of the Series. Distributions
are recorded on the ex-dividend date.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, character reclassification between net income and
net gains, or other tax adjustments. As a result, net investment income (loss)
and net investment gain (loss) on investment transactions for a reporting period
may differ significantly from distributions to shareholders during such period.
As a result, the Series may periodically make reclassifications among its
capital accounts without impacting the Series' net asset value. Any such
reclassifications are not reflected in the financial highlights.
OTHER
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make 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 and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement with Manning & Napier Advisors,
Inc., dba Exeter Asset Management (the "Advisor"), for which the Series pays the
Advisor a fee, computed daily and payable monthly, at an annual rate of 0.50% of
the Series' average daily net assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel
of the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and fund administration services. The salaries of all officers of
the Fund and of all Directors who are "affiliated persons" of the Fund or of the
Advisor, and all personnel of the Fund or of the Advisor performing services
relating to research, statistical and investment activities are paid by the
Advisor.
The Advisor has contractually agreed to waive its fee and, if necessary, pay
other expenses of the Series in order to maintain total expenses for the Series
at no more than 0.70% for Class A shares and 0.95% for Class E shares, of
average daily net assets each year. Accordingly, the Advisor waived fees
amounting to $13,358 for the periods ended April 30, 2000, which is reflected as
a reduction of expenses on the Statement of Operations.
The Advisor also acts as the transfer, dividend paying and shareholder servicing
agent for the Fund. For these services, the Series pays a fee which is
calculated as a percentage of the average daily net assets at an annual rate of
0.024%.
19
<PAGE>
Notes to Financial Statements (unaudited)
3. TRANSACTIONS WITH AFFILIATES (continued)
Manning & Napier Investor Services, Inc., a registered broker-dealer affiliate
of the Advisor, acts as distributor of the Fund's shares. The Series compensates
the distributor for distributing and servicing the Series' Class E shares
pursuant to plans of distribution, regardless of expenses actually incurred. The
distribution fees were accrued daily and payable quarterly, at an annual rate of
0.25% of the Class E's average daily net assets. No distribution or service fees
were paid for the Class A shares of the Series.
Effective April 2000 the Advisor became the Fund's accounting services agent.
For these services, the Fund will pay the Advisor a fee of 0.04% of each Series'
daily net assets calculated daily and payable monthly, with a minimum annual fee
of $48,000 per Series. In addition, the Fund will pay the Advisor an additional
annual fee of $10,000 for each additional class of a Series. The Advisor has
entered into an agreement with BISYS Fund Services Ohio, Inc. under which BISYS
will serve as sub-accounting services agent.
4. PURCHASES AND SALES OF SECURITIES
For the periods ended April 30, 2000, purchases and sales of securities, other
than United States Government securities and short-term securities, were
$8,404,442 and $1,005,346, respectively.
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of PureMarkSM Series Class A Common Stock were:
For the Period
Ended 04/30/00
--------------
Shares Amount
------ ------
Sold 1,602 $16,757
----- -------
Net change 1,602 $16,757
===== =======
Transactions in shares of PureMarkSM Series Class E Common Stock were:
For the Period
Ended 4/30/00
-------------
Shares Amount
------ ------
Sold 757,954 $7,750,209
Reinvested 850 8,405
Repurchased (44,679) (461,689)
-------- ---------
Net change 714,125 $7,296,925
======== ==========
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk
in the normal course of its investing activities to assist in managing exposure
to various market risks. These financial instruments include written options
and futures contracts and may involve, to a varying degree, elements of risk in
excess of the amounts recognized for financial statement purposes. No such
investments were held by the Series on April 30, 2000.
20
<PAGE>
<PAGE>
Exeter Fund, Inc.
Semi-Annual Report
April 30, 2000
Defensive Series
Blended Asset Series I
Blended Asset Series II
Maximum Horizon Series
<PAGE>
Management Discussion and Analysis (unaudited)
DEAR SHAREHOLDERS:
Over the course of the last year, the stock market has given investors a
roller-coaster ride. While stocks finished 1999 with strong returns, the
environment, undoubtedly, left people scratching their heads. Many publications
like to report the gaudy numbers of how the stock market performed over 1999,
but perhaps the most intriguing statistic we've seen about last year's market is
the price change of the median stock on the New York Stock Exchange: -4.4%. In
actuality, the typical U.S. stock went down in 1999, despite the impression by
composites that are skewed by capitalization weighting.
The first quarter of 2000 was not as kind to the stock market as many investors
had come to expect. The Dow Jones Industrial Average was extremely volatile,
closing up or down at least 100 points on 28 different days in the quarter, and
finished with a -4.6% return. It is possible, and we hope it will turn out to
be true, that the recent market volatility reflects a step toward fundamentals
and away from the speculative atmosphere that has dominated in recent years.
After struggling through 1999, the bond market has started to show some life
over the first part of 2000. A large factor in this stronger performance was
the U.S. Treasury's announcement that it plans to buy back existing, long-term
U.S. Treasury Securities. The buyback is expected to significantly reduce the
supply of longer-term bonds over the next few years, and the anticipation of
such has contributed to the increase in the price of long-term bonds. Long-term
interest rates declined during the first part of 2000, but short-term rates rose
in response to increases in the Fed Funds rate implemented by the Federal
Reserve Bank. These higher rates tend to reduce liquidity in the economy, which
partially explains why many stock market indices struggled over the early part
of this year.
All four objective-based Series have continued to turn in healthy positive gains
over the last six months despite the U.S. stock market's turmoil. Beyond the
benefits achieved by investing part of the portfolios' assets in long bonds,
investments in attractively valued domestic and foreign stocks have paid off as
well. So far this year, our energy and health care stocks have led the way for
us, reporting strong returns and outpacing the S&P 500 in both particular
sectors. International stocks have grown to play an even larger role, as we
have continued to identify value abroad. This gives us the opportunity to do
well even when the domestic environment is inhospitable to value investors.
This experience emphasizes the fact that fundamental investment disciplines are
a form of universal language, as we have been able to add value as investors in
foreign markets over time, using the same traditional strategies we developed in
the U.S. market. We believe that concentrating on fundamentals and avoiding
overvalued securities is the key to long-term success in the markets.
As of late, there have been more and more articles in the press about long-time
value managers finally caving in to performance pressures and abandoning their
performance styles. We have not. Right now, we are coming off a year in which
performance was good, and our valuation characteristics remain firmly intact.
While it is still too early to tell, the sharp disruptions in some of the
high-flying areas of the market lately suggest that the best may be yet to come
for those who have stayed true to fundamental investment disciplines.
As always, we appreciate the opportunity to serve you.
Sincerely,
EXETER ASSET MANAGEMENT
1
<PAGE>
Asset Allocation - As of 4/30/00 (unaudited)
[graphic]
[pie chart]
Defensive Series
Stocks - 17.75%
Bonds - 79.35%
Cash, short-term investments, and other assets, less liabilities - 2.90%
[graphic]
[pie chart]
Blended Asset Series I
Stocks - 45.80%
Bonds - 51.58%
Cash, short-term investments, and other assets, less liabilities - 2.62%
[graphic]
[pie chart]
Blended Asset Series II
Stocks - 56.30%
Bonds - 41.48%
Cash, short-term investments, and other assets, less liabilities - 2.22%
[graphic]
[pie chart]
Maximum Horizon Series
Stocks - 87.62%
Bonds - 4.73%
Cash, short-term investments, and other assets, less liabilities - 7.65%
2
<PAGE>
Performance Update as of April 30, 2000 (unaduited)
Exeter Fund, Inc. - Defensive Series
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,353 3.53% 3.53%
Inception 1 $12,914 29.14% 5.85%
</TABLE>
Lehman Brothers Intermediate Bond Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,155 1.55% 1.55%
Inception 1 $12,667 26.67% 5.39%
</TABLE>
15-85 Blended Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,294 2.94% 2.94%
Inception 1 $14,287 42.87% 8.25%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Defensive Series
from its inception (11/1/95) to present (4/30/00) as compared to the Lehman
Brothers Intermediate Bond Index and a 15-85 Blended Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Lehman Brothers Intermediate
Date Defensive Series Bond Index 15-85 Blended Index
<S> <C> <C> <C>
11/01/1995 10,000 10,000 10,000
10/31/1996 10,494 10,581 10,847
10/31/1997 11,411 11,374 12,052
10/31/1998 12,157 12,411 13,398
10/31/1999 12,371 12,533 13,999
04/30/2000 12,914 12,667 14,287
</TABLE>
1 Performance numbers for the Series and Indices are calculated from November 1,
1995, the Series' inception date. The Fund's performance is historical and may
not be indicative of future results.
2 The Lehman Brothers Intermediate Bond Index is a market value weighted measure
of approximately 3,300 corporate and government securities. The Index is
comprised of investment grade securities with maturities greater than one year
but less than ten years. The 15-85 Blended Index is 15% Standard & Poor's
(S&P) 500 Total Return Index and 85% Lehman Brothers Intermediate Bond Index.
The S&P 500 Total Return Index is an unmanaged capitalization-weighted measure
of 500 widely held common stocks listed on the New York Stock Exchange, American
Stock Exchange, and Over-the-Counter market. Both Indices returns assume
reinvestment of income and, unlike Fund returns, do not reflect any fees or
expenses.
3
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Defensive Series SHARES (NOTE 2)
------------------------------------------------------ ------- ---------
COMMON STOCK - 17.75%
<S> <C> <C>
AGRICULTURAL PRODUCTION -0.06%
Sylvan, Inc.*. . . . . . . . . . . . . . . . . . . . . 375 $ 3,094
---------
APPAREL - 0.59%
Adidas-Salomon AG (Germany) (Note 7) . . . . . . . . . 450 28,376
---------
BUSINESS SERVICES - 0.30%
National Data Corp.. . . . . . . . . . . . . . . . . . 525 14,569
---------
CHEMICAL & ALLIED PRODUCTS - 3.54%
AGRICULTURAL PRODUCTS - 0.03%
Agrium, Inc. (Note 7). . . . . . . . . . . . . . . 75 703
Mississippi Chemical Corp. . . . . . . . . . . . . 75 577
---------
1,280
---------
BIOLOGICAL PRODUCTS - 0.66%
Connetics Corp.. . . . . . . . . . . . . . . . . . 50 475
Cypress Bioscience, Inc.*. . . . . . . . . . . . . 450 984
PathoGenesis Corp. . . . . . . . . . . . . . . . . 50 1,063
Sigma-Aldrich Corp.. . . . . . . . . . . . . . . . 1,000 29,375
---------
31,897
---------
PHARMACEUTICAL PREPARATIONS - 1.55%
Abbott Laboratories. . . . . . . . . . . . . . . . 25 961
American Home Products Corp. . . . . . . . . . . . 10 562
Merck KgaA (Germany) (Note 7). . . . . . . . . . . 25 720
Mylan Laboratories, Inc. . . . . . . . . . . . . . 2,000 56,750
Pharmacia Corp.. . . . . . . . . . . . . . . . . . 11 549
Teva Pharmaceutical Industries Ltd. - ADR (Note D) 300 13,200
Warner-Lambert Co. . . . . . . . . . . . . . . . . 10 1,138
Watson Pharmaceuticals, Inc. . . . . . . . . . . . 10 449
---------
74,329
---------
PLASTIC MATERIALS - 1.30%
Eastman Chemical Co. . . . . . . . . . . . . . . . 1,200 62,775
---------
170,281
---------
COMPUTER INTEGRATED SYSTEMS DESIGN - 0.35%
Cerner Corp. . . . . . . . . . . . . . . . . . . . . . 10 221
Parametric Technology Corp.. . . . . . . . . . . . . . 1,900 15,497
Shared Medical Systems Corp. . . . . . . . . . . . . . 25 1,036
---------
16,754
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Defensive Series SHARES (NOTE 2)
-------------------------------------------- ------- ---------
<S> <C> <C>
CRUDE PETROLEUM & NATURAL GAS - 2.17%
Gulf Canada Resources Ltd. - ADR (Note 7). . 13,600 $ 56,100
Halliburton Co.. . . . . . . . . . . . . . . 500 22,094
Petroleo Brasileiro S.A. (Petrobras) -
ADR (Note 7) . . . . . . . . . . . . . . . 1,075 25,468
Stolt Comex Seaway SA* (Note 7). . . . . . . 75 905
---------
104,567
---------
ELECTRIC, GAS & SANITARY SERVICES - 1.08%
CH Energy Group, Inc.. . . . . . . . . . . . 25 823
Cinergy Corp.. . . . . . . . . . . . . . . . 350 9,362
Conectiv, Inc. . . . . . . . . . . . . . . . 500 8,875
FirstEnergy Corp.. . . . . . . . . . . . . . 400 10,175
Newpark Resources, Inc.* . . . . . . . . . . 450 3,712
PPL Corp.. . . . . . . . . . . . . . . . . . 400 9,550
Potomac Electric Power Co. . . . . . . . . . 400 9,375
---------
51,872
---------
ELECTRONICS & ELECTRICAL EQUIPMENT - 0.24%
The Carbide/Graphite Group, Inc.*. . . . . . 300 1,050
Raytheon Co. - Class A . . . . . . . . . . . 450 10,322
---------
11,372
---------
FABRICATED METAL PRODUCTS - 0.36%
Alliant Techsystems, Inc.. . . . . . . . . . 25 1,741
American National Can Group. . . . . . . . . 75 1,261
Lockheed Martin Corp.. . . . . . . . . . . . 550 13,681
Norddeutsche Affinerie AG (Germany) (Note 7) 75 724
---------
17,407
---------
FOOD & BEVERAGES - 2.26%
Bestfoods. . . . . . . . . . . . . . . . . . 600 30,150
Diageo plc - ADR (Note 7). . . . . . . . . . 550 18,700
Flowers Industries, Inc. . . . . . . . . . . 25 381
H.J. Heinz Co. . . . . . . . . . . . . . . . 900 30,600
Unilever plc - ADR (Note D). . . . . . . . . 1,160 28,855
---------
108,686
---------
FURNITURE & FIXTURES - 0.03%
Hillenbrand Industries, Inc. . . . . . . . . 50 1,506
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Defensive Series SHARES (NOTE 2)
--------------------------------------------------------- ------ ---------
<S> <C> <C>
GENERAL SURGICAL & MEDICAL HOSPITALS - 0.47%
Columbia/HCA Healthcare Corp.*. . . . . . . . . . . . . . 125 $ 3,555
Health Management Associates, Inc. *. . . . . . . . . . . 100 1,594
Lifepoint Hospitals, Inc. * . . . . . . . . . . . . . . . 175 2,997
Province Healthcare Co. * . . . . . . . . . . . . . . . . 75 2,166
Quorum Health Group, Inc. * . . . . . . . . . . . . . . . 175 1,859
Tenet Healthcare Corp.* . . . . . . . . . . . . . . . . . 100 2,550
Triad Hospitals, Inc. * . . . . . . . . . . . . . . . . . 225 3,867
Universal Health Services, Inc. * . . . . . . . . . . . . 75 4,106
---------
22,694
---------
GLASS PRODUCTS - 0.05%
Libbey, Inc.. . . . . . . . . . . . . . . . . . . . . . . 50 1,525
Waterford Wedgwood (United Kingdom) (Note 7). . . . . . . 800 776
---------
2,301
---------
INDUSTRIAL & COMMERCIAL MACHINERY - 1.49%
Baker Hughes, Inc. . . . . . . . . . . . . . . . . . . . 1,100 34,994
Bell & Howell Co.*. . . . . . . . . . . . . . . . . . . . 25 664
Compaq Computer Corp. . . . . . . . . . . . . . . . . . . 1,200 35,100
Moog Inc. - Class A*. . . . . . . . . . . . . . . . . . . 25 589
PSC, Inc. . . . . . . . . . . . . . . . . . . . . . . . . 75 300
---------
71,647
---------
INVESTORS - 0.30%
Reed International plc - ADR (Note 7) . . . . . . . . . . 500 14,313
---------
METAL INDUSTRIES - 0.40%
Intermet Corp.. . . . . . . . . . . . . . . . . . . . . . 75 553
Phelps Dodge Corp.. . . . . . . . . . . . . . . . . . . . 300 13,875
Texas Industries, Inc.. . . . . . . . . . . . . . . . . . 150 4,894
---------
19,322
---------
MOTION PICTURE PRODUCTION - 0.03%
Alliance Atlantis Communications Corp.* (Canada) (Note 7) 100 1,245
---------
NURSING CARE FACILITIES - 0.03%
Manor Care, Inc.* . . . . . . . . . . . . . . . . . . . . 125 1,492
---------
PAPER & ALLIED PRODUCTS - 0.03%
Smurfit - Stone Container Corp.*. . . . . . . . . . . . . 99 1,510
---------
RETAIL - SPECIALTY STORES - 0.07%
Hancock Fabrics, Inc. . . . . . . . . . . . . . . . . . . 775 3,052
Syms Corp.. . . . . . . . . . . . . . . . . . . . . . . . 75 300
---------
3,352
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Defensive Series SHARES (NOTE 2)
------------------------------------------------ ------- ---------
<S> <C> <C>
RUBBER & MISCELLANEOUS PLASTIC PRODUCTS - 0.02%
Applied Extrusion Technologies, Inc. . . . . . . 125 $ 898
---------
SOCIAL SERVICES - 0.08%
Alterra Healthcare Corp.*. . . . . . . . . . . . 250 812
American Retirement Corp. *. . . . . . . . . . . 200 1,500
Brookdale Living Communities, Inc.*. . . . . . . 25 322
Emeritus Corp.*. . . . . . . . . . . . . . . . . 50 200
Sunrise Assisted Living, Inc. *. . . . . . . . . 50 788
---------
3,622
---------
TECHNICAL INSTRUMENTS & SUPPLIES - 1.08%
Baxter International, Inc. . . . . . . . . . . . 25 1,628
Beckman Coulter, Inc.. . . . . . . . . . . . . . 25 1,620
Beckton, Dickinson & Co. . . . . . . . . . . . . 50 1,281
Eastman Kodak Co.. . . . . . . . . . . . . . . . 850 47,547
Edwards Lifesciences Corp. . . . . . . . . . . . 5 75
---------
52,151
---------
TELECOMMUNICATION SERVICES - 0.34%
Sinclair Broadcast Group, Inc.*. . . . . . . . . 125 977
Telecomunicacoes Brasileiras S.A. (Telebras) -
ADR PFD (Note D) . . . . . . . . . . . . . . 130 15,364
---------
16,341
---------
TESTING LABORATORIES - 0.08%
Paradigm Geophysical Ltd.* . . . . . . . . . . . 700 4,069
---------
TEXTILE MILL PRODUCTS - 0.11%
Albany International Corp. - Class A . . . . . . 358 5,437
---------
TRANSPORTATION - 2.19%
EQUIPMENT - 0.31%
Newport News Shipbuilding, Inc.. . . . . . . 25 834
Northrop Grumman Corp. . . . . . . . . . . . 200 14,175
---------
15,009
---------
RAILROAD - 1.76%
Burlington North Santa Fe Corp.. . . . . . . 1,800 43,425
Canadian National Railway Co. - ADR (Note D) 1,450 40,691
Westinghouse Air Brake Co. . . . . . . . . . 50 566
---------
84,682
---------
WATER - 0.12%
Trico Marine Services, Inc.* . . . . . . . . 775 5,861
---------
105,552
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
Defensive Series AMOUNT/SHARES (NOTE 2)
-------------------------------------------- -------------- --------
<S> <C> <C>
TOTAL COMMON STOCK
(Identified Cost $845,938) . . . . . . . $ 854,430
----------
U.S. TREASURY SECURITIES - 69.81%
U.S. TREASURY BONDS - 5.90%
U.S. Treasury Bond, 6.875%, 8/15/2025 . $ 210,000 227,128
U.S. Treasury Bond, 6.500%, 11/15/2026 . 55,000 57,063
--------
TOTAL U.S. TREASURY BONDS
(Identified Cost $282,852) . . . . . . . . 284,191
--------
U.S. TREASURY NOTES - 63.91%
U.S. Treasury Notes, 6.125%, 9/30/2000. 150,000 149,859
U.S. Treasury Notes, 5.625%, 2/28/2001. 60,000 59,588
U.S. Treasury Notes, 6.375%, 9/30/2001. 25,000 24,891
U.S. Treasury Notes, 7.500%, 11/15/2001. 50,000 50,575
U.S. Treasury Notes, 6.250%, 6/30/2002. 150,000 148,641
U.S. Treasury Notes, 5.875%, 9/30/2002. 275,000 270,188
U.S. Treasury Notes, 6.250%, 2/15/2003. 215,000 212,850
U.S. Treasury Notes, 5.500%, 3/31/2003. 190,000 184,478
U.S. Treasury Notes, 5.875%, 2/15/2004. 75,000 73,266
U.S. Treasury Notes, 6.000%, 8/15/2004. 500,000 489,532
U.S. Treasury Notes, 7.250%, 8/15/2004. 65,000 66,544
U.S. Treasury Notes, 6.500%, 5/15/2005. 625,000 624,024
U.S. Treasury Notes, 6.125%, 8/15/2007. 5,000 4,895
U.S. Treasury Notes, 5.500%, 2/15/2008. 240,000 226,350
U.S. Treasury Notes, 4.750%, 11/15/2008. 550,000 491,219
--------
TOTAL U.S. TREASURY NOTES
(Identified Cost $3,129,301) . . . . . . . 3,076,900
----------
TOTAL U.S. TREASURY SECURITIES
(Identified Cost $3,412,153) . . . . . 3,361,091
----------
U.S. GOVERNMENT AGENCIES - 9.54%
MORTGAGE BACKED SECURITIES
GNMA, Pool #365225, 9.00%, 11/15/2024. . 20,013 20,724
GNMA, Pool #398655, 6.50%, 5/15/2026 . 38,154 35,850
GNMA, Pool #452826, 9.00%, 1/15/2028 . 104,242 107,799
GNMA, Pool #460820, 6.00%, 6/15/2028 . 92,628 84,272
GNMA, Pool #458983, 6.00%, 1/15/2029 . 231,746 210,703
--------
TOTAL U.S. GOVERNMENT AGENCIES
(Identified Cost $472,434) . . . . . . . . 459,348
--------
</TABLE>
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Defensive Series SHARES (NOTE 2)
-------------------------------------- ---------- ---------
<S> <C> <C>
SHORT-TERM INVESTMENTS - 1.83%
Dreyfus Treasury Cash Management Fund
(Identified Cost $88,352). . . . 88,352 $ 88,352
-----------
TOTAL INVESTMENTS - 98.93%
(Identified Cost $4,818,877) . . 4,763,221
OTHER ASSETS, LESS LIABILITIES - 1.07% 51,652
----------
NET ASSETS - 100%. . . . . . . . . . . $4,814,873
==========
</TABLE>
*Non-income producing security
Federal Tax Information:
At April 30, 2000, the net unrealized depreciation based on identified cost for
federal income tax purposes of $4,818,877 was as follows:
Unrealized appreciation $100,157
Unrealized depreciation (155,813)
----------
UNREALIZED DEPRECIATION - NET $ (55,656)
===========
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
Statement of Assets and Liabilities - Defensive Series (unaudited)
<TABLE>
<CAPTION>
APRIL 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $4,818,877)(Note 2) . $4,763,221
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . 943
Interest receivable. . . . . . . . . . . . . . . . . . . . . 61,217
Receivable for fund shares sold. . . . . . . . . . . . . . . 7,826
Receivable for securities sold . . . . . . . . . . . . . . . 7,092
Dividends receivable . . . . . . . . . . . . . . . . . . . . 1,425
-----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . 4,841,724
-----------
LIABILITIES:
Accrued management fees (Note 3) . . . . . . . . . . . . . . 588
Accrued directors' fees (Note 3) . . . . . . . . . . . . . . 5,708
Accrued fund accounting fees (Note 3). . . . . . . . . . . . 3,672
Transfer agent fees payable (Note 3) . . . . . . . . . . . . 560
Audit fee payable. . . . . . . . . . . . . . . . . . . . . . 6,746
Registration and filing fees payable . . . . . . . . . . . . 5,112
Other payables and accrued expenses. . . . . . . . . . . . . 4,465
-----------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . . 26,851
-----------
NET ASSETS FOR 452,762 SHARES OUTSTANDING. . . . . . . . . . $4,814,873
===========
NET ASSETS CONSIST OF:
Capital stock. . . . . . . . . . . . . . . . . . . . . . . . $ 4,528
Additional paid-in-capital . . . . . . . . . . . . . . . . . 4,718,356
Undistributed net investment income. . . . . . . . . . . . . 70,410
Accumulated net realized gain on investments . . . . . . . . 77,238
Net unrealized depreciation on investments and other assets
and liabilities . . . . . . . . . . . . . . . . . . . . . (55,659)
-----------
TOTAL NET ASSETS . . . . . . . . . . . . . . . . . . . . . . $4,814,873
===========
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($4,814,873/452,762 shares) . . . . . . . . . . . . . . . $ 10.63
===========
</TABLE>
The accompanying notes are an integral part of financial statements.
10
<PAGE>
Statement of Operations - Defensive Series (unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Interest. . . . . . . . . . . . . . . . . . . . . . . $115,520
Dividends (net of foreign tax withheld, $192) . . . . 8,942
---------
Total Investment Income . . . . . . . . . . . . . . . 124,462
---------
EXPENSES:
Management fees (Note 3). . . . . . . . . . . . . . . 19,664
Fund accounting fees (Note 3) . . . . . . . . . . . . 3,672
Directors' fees (Note 3). . . . . . . . . . . . . . . 3,591
Transfer agent fees (Note 3). . . . . . . . . . . . . 560
Registration and filing fees. . . . . . . . . . . . . 4,987
Audit fee . . . . . . . . . . . . . . . . . . . . . . 4,737
Custodian fee . . . . . . . . . . . . . . . . . . . . 2,992
Miscellaneous . . . . . . . . . . . . . . . . . . . . 2,199
---------
Total Expenses. . . . . . . . . . . . . . . . . . . . 41,402
Less Reduction of Expenses (Note 3) . . . . . . . . . (18,076)
---------
Net Expenses. . . . . . . . . . . . . . . . . . . . . 23,326
---------
NET INVESTMENT INCOME . . . . . . . . . . . . . . . . 101,136
---------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized gain on investments. . . . . . . . . . . 88,402
Net change in unrealized depreciation on investments. 17,368
---------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS . . . . . . . . . . . . . . . . . . 105,770
---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS. . . . . . . . . . . . . . . . . . $206,906
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
11
<PAGE>
Statements of Changes in Net Assets - Defensive Series
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED FOR THE
4/30/00 YEAR ENDED
(unaudited) 10/31/99
------------ ----------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . . . . . . $ 101,136 $ 235,418
Net realized gain on investments . . . . . . . . . . . 88,402 39,396
Net change in unrealized appreciation (depreciation)
on investments . . . . . . . . . . . . . . . . . . 17,368 (154,121)
------------ ----------
Net increase from operations . . . . . . . . . . . . . 206,906 120,693
------------ ----------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . . . . . (147,880) (212,396)
From net realized gain on investments. . . . . . . . . (42,821) (20,762)
------------ ----------
Total distribution to shareholders . . . . . . . . . . (190,701) (233,158)
------------ ----------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net decrease from capital share
transactions (Note 5) . . . . . . . . . . . . . . . (38,090) (783,936)
------------ ----------
Net decrease in net assets . . . . . . . . . . . . . . (21,885) (896,401)
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . . . 4,836,758 5,733,159
------------ ----------
END OF PERIOD (including undistributed net investment
income of $70,410 and $117,154, respectively). . . . . $ 4,814,873 $4,836,758
============ ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
12
<PAGE>
Financial Highlights - Defensive Series
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED FOR THE YEAR ENDED
4/30/00 10/31/99 10/31/98 10/31/97 10/31/96
(unaudited)
------------ -------------------- ---------- ---------- ----------
Per share data (for a share
outstanding throughout each period):
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD $10.62 $10.85 $10.71 $10.29 $10.00
------------ -------------------- ---------- ---------- ----------
Income from investment operations:
Net investment income* 0.24 0.46 0.35 0.42 0.35
Net realized and unrealized gain on
investments 0.21 (0.27) 0.32 0.45 0.14
------------ -------------------- ---------- ---------- ----------
Total from investment operations 0.45 0.19 0.67 0.87 0.49
------------ -------------------- ---------- ---------- ----------
Less distributions to shareholders:
From net investment income (0.34) (0.38) (0.35) (0.38) (0.20)
From net realized gain on investments (0.10) (0.04) (0.18) (0.07) --
------------ -------------------- ---------- ---------- ----------
Total distribution, to shareholders (0.44) (0.42) (0.53) (0.45) (0.20)
------------ -------------------- ---------- ---------- ----------
NET ASSET VALUE - END OF PERIOD $10.63 $10.62 $10.85 $10.71 $10.29
============ ==================== ========== ========== ==========
Total return1 4.39% 1.75% 6.54% 8.74% 4.94%
Ratios (to average net assets) /
Supplemental data:
Expenses* 1.00%2 1.00% 1.00% 1.00% 1.00%
Net investment income* 4.33%2 4.08% 4.20% 4.45% 4.26%
Portfolio turnover 20% 33% 15% 60% 30%
NET ASSETS - END OF PERIOD
(000's omitted) $4,815 $4,837 $5,733 $1,764 $745
============ ==================== ========== ========== ==========
</TABLE>
*The investment advisor did not impose all or a portion of its management fee
and in some periods paid a portion of the Series' expenses. If these expenses
had been incurred by the Series, and had 1996 expenses been limited to that
allowed by state securities law, the net investment income per share and the
ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Net investment income . . . . . $ 0.21 $0.40 $0.29 $0.27 $0.23
Ratios (to average net assets):
Expenses . . . . . . . . . . 1.51%2 1.57% 1.73% 2.59% 2.50%
Net investment income. . . . 3.82%2 3.51% 3.47% 2.86% 2.76%
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
13
<PAGE>
Performance Update as of April 30, 2000 (unaudited)
Exeter Fund, Inc. - Blended Asset Series I
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,473 4.73% 4.73%
Five Year $16,014 60.14% 9.86%
Inception 1 $17,352 73.52% 8.67%
</TABLE>
Lehman Brothers Intermediate Bond Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,155 1.55% 1.55%
Five Year $14,382 43.82% 6.18%
Inception 1 $14,039 40.39% 5.25%
</TABLE>
30 - 70 Blended Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,431 4.31% 4.31%
Five Year $17,509 75.09% 11.84%
Inception 1 $18,854 88.54% 10.04%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Blended Asset
Series I from its inception (9/15/93) to present (4/30/00) as compared to the
Lehman Brothers Intermediate Bond Index and a 30-70 Blended Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Lehman Brothers
Blended Asset Intermediate 30-70 Blended
Date Series I Bond Index Index
<S> <C> <C> <C>
09/15/1993 10,000 10,000 10,000
12/31/1993 10,092 10,032 10,081
12/31/1994 10,012 9,838 9,986
12/31/1995 12,123 11,347 12,151
10/31/1996 12,806 11,728 13,040
10/31/1997 14,472 12,606 14,965
10/31/1998 15,383 13,755 16,937
10/31/1999 16,048 13,891 18,300
04/30/2000 17,352 14,039 18,854
</TABLE>
1 Performance numbers for the Series and Indices are calculated from September
15, 1993, the Series' inception date. The Series' performance is historical and
may not be indicative of future results.
2 The Lehman Brothers Intermediate Bond Index is a market value weighted measure
of approximately 3,300 corporate and government securities. The Index is
comprised of investment grade securities with maturities greater than one year
but less than ten years. The 30-70 Blended Index is 30% Standard & Poor's
(S&P) 500 Total Return Index and 70% Lehman Brothers Intermediate Bond Index.
The S&P 500 Total Return Index is an unmanaged capitalization- weighted measure
of 500 widely held common stocks listed on the New York Stock Exchange, American
Stocks Exchange, and Over-the-Counter market. Both Indices' returns assume
reinvestment of income and, unlike Series returns, do not reflect any fees or
expenses.
14
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series I SHARES (NOTE 2)
------------------------------------------------- --------- ---------
COMMON STOCK - 45.80%
<S> <C> <C>
AGRICULTURAL PRODUCTION - 0.04%
Sylvan, Inc.* . . . . . . . . . . . . . . . . . . 1,250 $ 10,313
---------
APPAREL - 1.77%
Adidas-Salomon AG (Germany) (Note 7). . . . . . . 6,700 422,493
---------
BUSINESS SERVICES - 0.77%
National Data Corp. . . . . . . . . . . . . . . . 6,625 183,844
---------
CHEMICAL & ALLIED PRODUCTS - 8.02%
AGRICULTURAL PRODUCTS - 0.07%
Agrium, Inc. (Note 7). . . . . . . . . . . . . 1,000 9,375
Mississippi Chemical Corp. . . . . . . . . . . 1,050 8,072
---------
17,447
---------
BIOLOGICAL PRODUCTS - 2.17%
Connetics Corp.. . . . . . . . . . . . . . . . 575 5,462
Cypress Bioscience, Inc.*. . . . . . . . . . . 5,925 12,961
PathoGenesis Corp.*. . . . . . . . . . . . . . 500 10,625
Sigma-Aldrich Corp.. . . . . . . . . . . . . . 16,675 489,828
---------
518,876
---------
PHARMACEUTICAL PREPARATIONS - 2.87%
Abbott Laboratories. . . . . . . . . . . . . . 275 10,570
American Home Products Corp. . . . . . . . . . 100 5,619
Instrumentarium Oyj (Finland) (Note 7) . . . . 9 226
Johnson & Johnson. . . . . . . . . . . . . . . 125 10,313
Merck KgaA (Germany) (Note 7). . . . . . . . . 350 10,078
Mylan Laboratories, Inc. . . . . . . . . . . . 21,975 623,541
Orion-Yhtyma Oyj - B Shares (Finland) (Note 7) 420 9,779
Pharmacia Corp.. . . . . . . . . . . . . . . . 89 4,444
Warner-Lambert Co. . . . . . . . . . . . . . . 50 5,691
Watson Pharmaceutical, Inc.. . . . . . . . . . 125 5,617
---------
685,878
---------
PLASTIC MATERIALS - 2.91%
Eastman Chemical Co.. . . . . . . . . . . . . . 13,275 694,448
---------
1,916,649
---------
COMPUTER INTEGRATED SYSTEMS & DESIGN - 0.90%
Cerner Corp.. . . . . . . . . . . . . . . . . . . 150 3,309
Parametric Technology Corp. . . . . . . . . . . . 24,600 200,644
Shared Medical Systems Corp.. . . . . . . . . . . 250 10,359
---------
214,312
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
15
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series I SHARES (NOTE 2)
------------------------------------------------- --------- ---------
<S> <C> <C>
CRUDE PETROLEUM & NATURAL GAS - 4.343%
Gulf Canada Resouces, Ltd - ADR* (Note 7) . . . . 169,850 $700,631
Petroleo Brasileiro SA (Petrobras) - ADR (Note 7) 13,575 321,611
Stolt Comex Seaway SA* (Note 7) . . . . . . . . . 1,100 13,269
---------
1,035,511
---------
ELECTRIC, GAS & SANITARY SERVICES - 3.02%
CH Energy Group, Inc. . . . . . . . . . . . . . . 325 10,705
Cinergy Corp. . . . . . . . . . . . . . . . . . . 5,300 141,775
Conectiv, Inc.. . . . . . . . . . . . . . . . . . 7,300 129,575
FirstEnergy Corp. . . . . . . . . . . . . . . . . 5,600 142,450
Newpark Resources, Inc. . . . . . . . . . . . . . 1,500 12,375
PPL Corp. . . . . . . . . . . . . . . . . . . . . 6,000 143,250
Potomac Electric Power Co.. . . . . . . . . . . . 6,000 140,625
---------
720,755
---------
ELECTRONICS & ELECTRICAL EQUIPMENT - 0.61%
The Carbide/Graphite Group, Inc.* . . . . . . . . 975 3,412
Raytheon Co. - Class A. . . . . . . . . . . . . . 6,200 142,213
---------
145,625
---------
FABRICATED METAL PRODUCTS - 0.91%
Alliant Techsystems, Inc. . . . . . . . . . . . . 100 6,962
American National Can Group . . . . . . . . . . . 900 15,131
Lockheed Martin Corp. . . . . . . . . . . . . . . 7,500 186,563
Norddeutsche Affinerie AG (Germany) (Note 7). . . 925 8,935
---------
217,591
---------
FOOD & KINDRED PRODUCTS - 6.50%
Bestfoods . . . . . . . . . . . . . . . . . . . . 8,600 432,150
Diageo plc - ADR (Note 7) . . . . . . . . . . . . 7,800 265,200
Flowers Industries, Inc.. . . . . . . . . . . . . 400 6,100
H.J. Heinz Co.. . . . . . . . . . . . . . . . . . 13,100 445,400
Unilever plc - ADR (Note 7) . . . . . . . . . . . 16,232 403,771
---------
1,552,621
---------
FURNITURE & FIXTURES - 0.08%
Hillenbrand Industries, Inc.. . . . . . . . . . . 600 18,075
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
16
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series I SHARES (NOTE 2)
--------------------------------------------------------- --------- ---------
<S> <C> <C>
GENERAL SURGICAL & MEDICAL HOSPITALS - 1.27%
Columbia/HCA Healthcare Corp.*. . . . . . . . . . . . . . 1,650 $ 46,922
Health Management Associates, Inc.* . . . . . . . . . . . 1,175 18,727
Lifepoint Hospitals, Inc.*. . . . . . . . . . . . . . . . 2,600 44,525
Province Healthcare Co.*. . . . . . . . . . . . . . . . . 1,025 29,597
Quorum Health Group, Inc.*. . . . . . . . . . . . . . . . 2,350 24,969
Tenet Healthcare Corp.* . . . . . . . . . . . . . . . . . 1,325 33,788
Triad Hospitals, Inc.*. . . . . . . . . . . . . . . . . . 2,950 50,703
Universal Health Services, Inc.*. . . . . . . . . . . . . 1,000 54,750
---------
303,981
---------
GLASS PRODUCTS - 0.11%
Libbey, Inc.. . . . . . . . . . . . . . . . . . . . . . . 500 15,250
Waterford Wedgewood (United Kingdom) (Note 7) . . . . . . 11,000 10,672
---------
25,922
---------
INDUSTRIAL & COMMERCIAL MACHINERY - 4.91%
Baker Hughes, Inc.. . . . . . . . . . . . . . . . . . . . 21,700 690,331
Bell & Howell Co.*. . . . . . . . . . . . . . . . . . . . 325 8,633
Compaq Computer Corp. . . . . . . . . . . . . . . . . . . 15,800 462,150
Moog, Inc. - Class A* . . . . . . . . . . . . . . . . . . 300 7,069
PSC, Inc. . . . . . . . . . . . . . . . . . . . . . . . . 975 3,900
---------
1,172,083
---------
INVESTORS - 0.78%
Reed International plc - ADR (Note 7) . . . . . . . . . . 6,500 186,063
---------
MOTION PICTURE PRODUCTION - 0.07%
Alliance Atlantis Communications Corp.* (Canada) (Note 7) 1,300 16,188
---------
NURSING CARE FACILITIES - 0.08%
Manor Care, Inc*. . . . . . . . . . . . . . . . . . . . . 1,650 19,697
---------
PAPER & ALLIED PRODUCTS - 0.11%
Smurfit-Stone Container Corp.*. . . . . . . . . . . . . . 1,782 27,176
---------
PRIMARY METAL INDUSTRIES - 0.96%
Intermet Corp . . . . . . . . . . . . . . . . . . . . . . 1,100 8,112
Phelps Dodge Corp.. . . . . . . . . . . . . . . . . . . . 4,200 194,250
Texas Industries, Inc.. . . . . . . . . . . . . . . . . . 800 26,100
---------
228,462
---------
RETAIL SPECIALTY STORES - 0.06%
Hancock Fabrics, Inc. . . . . . . . . . . . . . . . . . . 2,625 10,336
Syms Corp.. . . . . . . . . . . . . . . . . . . . . . . . 1,000 4,000
---------
14,336
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
17
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series I SHARES (NOTE 2)
----------------------------------------------- --------- ---------
<S> <C> <C>
RUBBER & MISCELLANEOUS PLASTIC PRODUCTS - 0.05%
Applied Extrusion Technologies, Inc.. . . . . . 1,800 $ 12,937
---------
SOCIAL SERVICES - 0.21%
Alterra Healthcare Corp.* . . . . . . . . . . . 3,325 10,806
American Retirement Corp.*. . . . . . . . . . . 2,700 20,250
Brookdale Living Communities, Inc.* . . . . . . 400 5,150
Emeritus Corp.* . . . . . . . . . . . . . . . . 675 2,700
Sunrise Assisted Living, Inc.*. . . . . . . . . 750 11,813
---------
50,719
---------
TECHNICAL INSTRUMENTS & SUPPLIES - 2.81%
Baxter International, Inc.. . . . . . . . . . . 250 16,281
Beckman Coulter, Inc. . . . . . . . . . . . . . 200 12,962
Becton, Dickinson & Co. . . . . . . . . . . . . 775 19,859
Eastman Kodak Co. . . . . . . . . . . . . . . . 11,125 622,305
Edwards Lifesciences Corp.. . . . . . . . . . . 50 750
---------
672,157
---------
TELECOMMUNICATION SERVICES - 0.95%
Sinclair Broadcast Group, Inc.* . . . . . . . . 1,600 12,500
Telecomunicacoes Brasileiras
S.A. (Telebras ) - ADR PFD (Note 7). . . . 1,810 213,919
---------
226,419
---------
TESTING LABORATORIES - 0.06%
Paradigm Geophysical Ltd.*. . . . . . . . . . . 2,350 13,659
---------
TEXTILE MILL PRODUCTS - 0.08%
Albany International Corp. - Class A. . . . . . 1,228 18,650
---------
TRANSPORTATION- 6.33%
EQUIPMENT - 0.89%
Newport News Shipbuilding, Inc.. . . . . . . 200 6,675
Northrop Grumman Corp. . . . . . . . . . . . 2,900 205,538
---------
212,213
---------
RAILROAD - 5.36%
Burlington Northern Santa Fe Corp. . . . . . 26,100 629,662
Canadian National Railway Co. - ADR (Note 7) 22,200 622,987
Genesee & Wyoming, Inc.* . . . . . . . . . . 1,300 19,825
Westinghouse Air Brake Co. . . . . . . . . . 750 8,484
---------
1,280,958
---------
WATER - 0.08%
Trico Marine Services, Inc.* . . . . . . . . 2,575 19,473
---------
1,512,644
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
18
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL VALUE
Blended Asset Series I AMOUNT (NOTE 2)
------------------------------------------ ----------- ----------
<S> <C> <C>
TOTAL COMMON STOCK
(Identified Cost $10,872,417). . . . . . . $10,938,882
-----------
U.S. TREASURY SECURITIES - 49.02%
U.S. TREASURY BONDS - 12.81%
U.S. Treasury Bond, 7.250%, 8/15/2022 . $ 390,000 435,460
U.S. Treasury Bond, 7.500%, 11/15/2024. 2,135,000 2,469,928
U.S. Treasury Bond, 6.50%, 11/15/2026 . 135,000 140,062
U.S. Treasury Bond, 5.50%, 8/15/2028. . 15,000 13,641
----------
TOTAL U.S. TREASURY BONDS
(Identified Cost $2,904,449). . . . . . 3,059,091
-----------
U.S. TREASURY NOTES - 36.21%
U.S. Treasury Note, 6.625%, 7/31/2001 . 3,285,000 3,285,000
U.S. Treasury Note, 6.625%, 3/31/2002 . 10,000 9,981
U.S. Treasury Note, 6.250%, 6/30/2002 . 185,000 183,324
U.S. Treasury Note, 5.875%, 9/30/2002 . 1,275,000 1,252,688
U.S. Treasury Note, 5.500%, 3/31/2003 . 1,445,000 1,403,005
U.S. Treasury Note, 5.375%, 6/30/2003 . 750,000 723,985
U.S. Treasury Note, 4.250%, 11/15/2003. 60,000 55,669
U.S. Treasury Note, 5.250%, 5/15/2004 . 10,000 9,537
U.S. Treasury Note, 6.00%, 8/15/2004. . 1,400,000 1,370,688
U.S. Treasury Note, 6.500%, 5/15/2005 . 355,000 354,445
----------
TOTAL U.S. TREASURY NOTES
(Identified Cost $8,744,584). . . . . . 8,648,322
----------
TOTAL U.S. TREASURY SECURITIES
(Identified Cost $11,649,033) . . . . . 11,707,413
-----------
U.S. GOVERNMENT AGENCIES - 2.56%
MORTGAGE BACKED SECURITIES - 0.20%
GNMA, Pool #286310, 9.00%, 2/15/2020. . 12,864 13,355
GNMA, Pool #288873, 9.50%, 8/15/2020. . 1,922 2,021
GNMA, Pool #385753, 9.00%, 7/15/2024. . 31,932 33,067
----------
TOTAL MORTGAGED BACKED SECURITIES
(Identified Cost $48,202). . . . . . . 48,443
-----------
OTHER AGENCIES - 2.36%
Federal National Mortgage Association
Note, 5.625%, 3/15/2001. . . . . . . 10,000 9,918
Federal National Mortgage Association
Note, 5.75%, 2/15/2008 . . . . . . . 25,000 22,667
Federal National Mortgage Association
Note, 6.25%, 5/15/2029 . . . . . . . 600,000 529,411
----------
TOTAL OTHER AGENCIES
(Identified Cost $575,120) . . . . . . 561,996
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
19
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series I SHARES (NOTE 2)
----------------------------------------- ----------- --------
<S> <C> <C>
TOTAL U.S. GOVERNMENT AGENCIES
(Identified Cost $623,322) . . . . . . $ 610,439
-----------
SHORT-TERM INVESTMENTS - 0.66%
Dreyfus Treasury Cash Management Fund
(Identified Cost $158,543) . . . . . . 158,543 158,543
-----------
TOTAL INVESTMENTS - 98.04%
(Identified Cost $23,303,315). . . . . 23,415,277
OTHER ASSETS, LESS LIABILITIES - 1.96%. . 468,878
-----------
NET ASSETS - 100% . . . . . . . . . . . . $23,884,155
===========
</TABLE>
*Non-income producing security
Federal Tax Information:
At April 30, 2000, the net unrealized appreciation based on identified cost for
federal income tax purposes of $23,303,315 was as follows:
Unrealized appreciation $1,390,324
Unrealized depreciation (1,278,362)
-----------
UNREALIZED APPRECIATION - NET $111,962
===========
The accompanying notes are an integral part of the financial statements.
20
<PAGE>
Statement of Assets and Liabilities - Blended Asset Series I (unaudited)
<TABLE>
<CAPTION>
APRIL 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $23,303,315)(Note 2) $23,415,277
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . 306,326
Interest receivable . . . . . . . . . . . . . . . . . . . . 223,317
Dividends receivable. . . . . . . . . . . . . . . . . . . . 31,841
Receivable for fund shares sold . . . . . . . . . . . . . . 2,870
Tax claims receivable . . . . . . . . . . . . . . . . . . . 152
-----------
TOTAL ASSETS. . . . . . . . . . . . . . . . . . . . . . . . 23,979,783
-----------
LIABILITIES:
Accrued management fees (Note 3). . . . . . . . . . . . . . 62,430
Accrued directors' fees (Note 3). . . . . . . . . . . . . . 4,041
Accrued fund accounting fees (Note 3) . . . . . . . . . . . 3,672
Transfer agent fees payable (Note 3). . . . . . . . . . . . 960
Audit fee payable . . . . . . . . . . . . . . . . . . . . . 8,242
Payable for fund shares repurchased . . . . . . . . . . . . 7,658
Other payables and accrued expenses . . . . . . . . . . . . 8,625
-----------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . 95,628
-----------
NET ASSETS FOR 2,091,000 SHARES OUTSTANDING . . . . . . . . $23,884,155
===========
NET ASSETS CONSIST OF:
Capital stock . . . . . . . . . . . . . . . . . . . . . . . $ 20,910
Additional paid-in-capital. . . . . . . . . . . . . . . . . 22,327,705
Undistributed net investment income . . . . . . . . . . . . 280,185
Accumulated net realized gain on investments and other
assets and liabilities . . . . . . . . . . . . . . . . 1,143,486
Net unrealized appreciation on investments and other
assets and liabilities . . . . . . . . . . . . . . . . 111,869
-----------
TOTAL NET ASSETS. . . . . . . . . . . . . . . . . . . . . . $23,884,155
===========
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($23,884,155/2,091,000 shares) . . . . . . . . . . . . . $ 11.42
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
21
<PAGE>
Statement of Operations - Blended Asset Series I (unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Interest. . . . . . . . . . . . . . . . . . . . . . . $ 403,950
Dividends (net of foreign tax withheld, $2,870) . . . 121,304
-----------
Total Investment Income . . . . . . . . . . . . . . . 525,254
-----------
EXPENSES:
Management fees (Note 3). . . . . . . . . . . . . . . 124,292
Fund accounting fees (Note 3) . . . . . . . . . . . . 3,672
Directors' fees (Note 3). . . . . . . . . . . . . . . 3,591
Transfer agent fees (Note 3). . . . . . . . . . . . . 2,983
Audit fee . . . . . . . . . . . . . . . . . . . . . . 8,691
Custodian fee . . . . . . . . . . . . . . . . . . . . 7,231
Registration and filing fees. . . . . . . . . . . . . 6,234
Miscellaneous . . . . . . . . . . . . . . . . . . . . 4,319
-----------
Total Expenses. . . . . . . . . . . . . . . . . . . . 161,013
Less Reduction of Expenses (Note 3) . . . . . . . . . (11,862)
-----------
Net Expenses. . . . . . . . . . . . . . . . . . . . . 149,151
-----------
NET INVESTMENT INCOME . . . . . . . . . . . . . . . . 376,103
-----------
REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized gain on investments and other assets . . 1,221,034
Net change in unrealized depreciation on investments
and other assets. . . . . . . . . . . . . . . . . 392,442
-----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS . . . . . . . . . . . . . . . . . . 1,613,476
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS. . . . . . . . . . . . . . . . . . $1,989,579
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
22
<PAGE>
Statements of Changes in Net Assets - Blended Asset Series I
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS
ENDED FOR THE
04/30/00 YEAR ENDED
(UNAUDITED) 10/31/99
---------- ---------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . . . . . . $ 376,103 $ 994,885
Net realized gain on investments . . . . . . . . . . . 1,221,034 588,481
Net change in unrealized appreciation on investments . 392,442 22,061
------------ ---------
Net increase from operations . . . . . . . . . . . . . 1,989,579 605,427
------------ ---------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . . . . . (622,833) (970,289)
From net realized gain on investments. . . . . . . . . (584,748) (1,849,031)
------------ ------------
Total distributions to shareholders. . . . . . . . . . (1,207,581)(2,819,320)
------------- ----------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net decrease from capital share
transactions (Note 5) . . . . . . . . . . . . . . . (3,413,020) (4,562,147)
------------- -----------
Net decrease in net assets . . . . . . . . . . . . . . (2,631,022) (5,776,040)
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . . . 26,515,177 32,291,217
----------- -----------
END OF PERIOD (including undistributed net investment
income of $280,185 and $526,915, respectively) . . . . $23,884,155 $26,515,177
============ ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
23
<PAGE>
Financial Highlights - Blended Asset Series I
<TABLE>
<CAPTION>
FOR THE
SIX FOR THE
MONTHS FOR THE FOR THE FOR THE TEN FOR THE
ENDED YEAR YEAR YEAR MONTHS YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 12/31/95
---------- ---------- ---------- ---------- ---------- ----------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD . . . . . . . $ 11.07 $ 11.59 $ 11.97 $ 11.20 $ 10.72 $ 9.72
---------- ---------- ---------- ---------- ---------- ---------
Income from investment operations:
Net investment income*. . . . . . . . . . . . . . 0.18 0.38 0.36 0.39 0.29 0.34
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . 0.69 0.22 0.35 1.01 0.31 1.70
---------- ---------- ---------- ---------- ---------- ---------
Total from investment operations . . . . . . . . . . 0.87 0.60 0.71 1.40 0.60 2.04
---------- ---------- ---------- ---------- ---------- ---------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . (0.27) (0.34) (0.33) (0.44) (0.09) (0.34)
In excess of net investment income. . . . . . . . -- -- -- -- -- (0.01)
From net realized gain on investments . . . . . . (0.25) (0.78) (0.76) (0.19) (0.03) (0.69)
---------- ---------- ---------- ---------- ---------- ---------
Total distributions to shareholders. . . . . . . . . (0.52) (1.12) (1.09) (0.63) (0.12) (1.04)
---------- ---------- ---------- ---------- ---------- ---------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ 11.42 $ 11.07 $ 11.59 $ 11.97 $ 11.20 $ 10.72
========== ========== ========== ========== ========== =========
Total return 1 . . . . . . . . . . . . . . . . . . . 8.134.73% 4.32% 6.29% 13.01% 5.64% 21.08%
Ratios (to average net assets) / Supplemental Data:
Expenses * . . . . . . . . . . . . . . . . . . . 1.20%2 1.20% 1.20% 1.20% 1.20%2 1.20%
Net investment income *. . . . . . . . . . . . . 3.03%2 3.09% 3.25% 3.39% 3.69%2 3.64%
Portfolio turnover . . . . . . . . . . . . . . . . . 37% 45% 60% 50% 85% 72%
NET ASSETS - END OF PERIOD (000'S OMITTED) . . . . . $ 23,884 $ 26,515 $ 32,291 $ 21,930 $ 17,794 $ 9,518
========== ========== ========== ========== ========== =========
</TABLE>
*The investment advisor did not impose all or a portion of its management fee
and in some periods paid a portion of the Series' expenses. If these expenses
had been incurred by the Series, the net investment income per share and the
ratios would be as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Net investment income . . . . . $ 0.17 $0.38 $0.35 $0.39 $ 0.28 $0.31
Ratios (to average net assets):
Expenses . . . . . . . . . . 1.30%2 1.23% 1.23% 1.24% 1.31%2 1.53%
Net investment income. . . . 2.93%2 3.06% 3.22% 3.35% 3.58%2 3.31%
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
The accompanying notes are an integral part of the financial statements.
24
<PAGE>
Performance Update as of April 30, 2000 (unaudited)
Exeter Fund, Inc. - Blended Asset Series II
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,544 5.44% 5.44%
Five Year $19,064 90.64% 13.76%
Inception 1 $21,899 118.99% 12.70%
</TABLE>
50-50 Blended Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,446 4.46% 4.46%
Five Year $20,698 106.98% 15.64%
Inception 1 $22,660 126.60% 13.29%
</TABLE>
Merrill Lynch Corporate/Government Bond Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,099 0.99% 0.99%
Five Year $14,836 48.36% 6.76%
Inception 1 $14,100 41.00% 5.38%
</TABLE>
Exeter Fund, Inc. - Blended Asset Series II from its inception (10/12/93) to
present (4/30/00) as compared to the Merrill Lynch Corporate/Government Bond
Index and a 50-50 Blended Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. 50-50 Merrill Lynch
Blended Asset Blended Corporate/Government
Date Series II Index Bond Index
<S> <C> <C> <C>
10/12/1993 10,000 10,000 10,000
12/31/1993 9,982 10,056 9,883
12/31/1994 10,333 9,978 9,561
12/31/1995 13,707 12,743 11,383
10/31/1996 15,078 13,978 11,625
10/31/1997 18,047 16,832 12,666
10/31/1998 17,947 19,525 13,975
10/31/1999 19,824 21,996 13,871
04/30/2000 21,899 22,660 14,100
</TABLE>
1 Performance numbers for the Fund and Indices are calculated from October 12,
1993, the Fund's inception date. The Fund's performance is historical and may
not be indicative of future results.
2 The 50-50 Blended Index is 50% Standard & Poor's (S&P) 500 Total Return Index
and 50% Lehman Brothers Aggregate Bond Index. The S&P 500 Total Return Index is
an unmanaged capitalization-weighted measure of 500 widely held common stocks
listed on the New York Stock Exchange, American Stock Exchange, and
Over-the-Counter market. The Lehman Brothers Aggregate Bond Index is a market
value weighted measure of approximately 5,600 corporate, government, and
mortgage backed securities. The Index is comprised of investment grade
securities with maturities greater than one year. The Merrill Lynch
Corporate/Government Bond Index is comprised of approximately 4,500 investment
grade corporate and government securities with maturities greater than one year.
The Indices returns assume reinvestment of income and, unlike Fund returns, do
not reflect any fees or expenses.
25
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series II SHARES (NOTE 2)
------------------------------------------------------ --------- -----------
COMMON STOCK - 56.30%
<S> <C> <C>
AGRICULTURAL PRODUCTION - 0.03%
Sylvan, Inc.*. . . . . . . . . . . . . . . . . . . . . 2,400 $ 19,800
-----------
APPAREL - 2.29%
Adidas-Salomon AG (Germany) (Note 7) . . . . . . . . . 23,100 1,456,654
-----------
BUSINESS SERVICES - 1.15%
National Data Corp.. . . . . . . . . . . . . . . . . . 26,350 731,213
-----------
CHEMICAL & ALLIED PRODUCTS - 9.88%
AGRICULTURAL PRODUCTS - 0.09%
Agrium, Inc. (Note 7). . . . . . . . . . . . . . . 3,400 31,875
Mississippi Chemical Corp. . . . . . . . . . . . . 3,625 27,867
-----------
59,742
-----------
BIOLOGICAL PRODUCTS - 2.25%
Connetics Corp.. . . . . . . . . . . . . . . . . . 1,775 16,862
Cypress Bioscience, Inc.*. . . . . . . . . . . . . 20,475 44,789
PathoGenesis Corp.*. . . . . . . . . . . . . . . . 1,675 35,594
Sigma-Aldrich Corp.. . . . . . . . . . . . . . . . 45,400 1,333,625
-----------
1,430,870
-----------
PHARMACEUTICAL PREPARATIONS - 4.90%
Abbott Laboratories. . . . . . . . . . . . . . . . 875 33,633
American Home Products Corp. . . . . . . . . . . . 325 18,261
Instrumentarium Oyj Corp. - (Finland) (Note 7) . . 32 817
Johnson & Johnson. . . . . . . . . . . . . . . . . 400 33,000
Merck KgaA - (Germany) (Note 7). . . . . . . . . . 1,050 30,235
Mylan Laboratories, Inc. . . . . . . . . . . . . . 76,900 2,182,038
Orion-Yhtyma Oyj - B Shares (Finland) (Note 7) . . 1,545 35,971
Pharmacia Corp.. . . . . . . . . . . . . . . . . . 327 16,330
Teva Pharmaceutical Industries Ltd. - ADR (Note 7) 16,500 726,000
Warner-Lambert Co. . . . . . . . . . . . . . . . . 175 19,917
Watson Pharmaceutical, Inc.. . . . . . . . . . . . 425 19,098
-----------
3,115,300
-----------
PLASTIC MATERIALS - 2.64%
Eastman Chemical Co. . . . . . . . . . . . . . . . 32,100 1,679,231
-----------
6,285,143
-----------
COMPUTER INTEGRATED SYSTEMS DESIGN - 2.10%
Cerner Corp. . . . . . . . . . . . . . . . . . . . . . 475 10,480
Parametric Technology Corp.. . . . . . . . . . . . . . 158,000 1,288,688
Shared Medical Systems Corp. . . . . . . . . . . . . . 800 33,150
-----------
1,332,318
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
26
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series II SHARES (NOTE 2)
----------------------------------------------- --------- -----------
<S> <C> <C>
CRUDE PETROLEUM & NATURAL GAS - 4.55%
Gulf Canada Resources Ltd. - ADR* (Note 7). . . 381,850 $1,575,131
Petroleo Brasileiro S.A. (Petrobras) -
ADR (Note 7). . . . . . . . . . . . . . . . 53,750 1,273,413
Stolt Comex Seaway, S.A.* (Note 7). . . . . . . 3,400 41,013
-----------
2,889,557
-----------
ELECTRIC, GAS, & SANITARY SERVICES - 2.83%
CH Energy Group, Inc. . . . . . . . . . . . . . 1,175 38,701
Cinergy Corp. . . . . . . . . . . . . . . . . . 13,000 347,750
Conectiv, Inc.. . . . . . . . . . . . . . . . . 18,100 321,275
FirstEnergy Corp. . . . . . . . . . . . . . . . 14,400 366,300
Newpark Resources, Inc.*. . . . . . . . . . . . 3,400 28,050
PPL Corp. . . . . . . . . . . . . . . . . . . . 14,800 353,350
Potomac Electric Power Co.. . . . . . . . . . . 14,800 346,875
-----------
1,802,301
-----------
ELECTRONICS & ELECTRICAL EQUIPMENT - 0.82%
The Carbide/Graphite Group, Inc.* . . . . . . . 1,900 6,650
Raytheon Co. - Class A. . . . . . . . . . . . . 22,500 516,094
-----------
522,744
-----------
FABRICATED METAL PRODUCTS - 1.14%
Alliant Techsystems, Inc. . . . . . . . . . . . 350 24,369
American National Can Group . . . . . . . . . . 3,175 53,379
Lockheed Martin Corp. . . . . . . . . . . . . . 24,700 614,412
Norddeutsche Affinerie AG - (Germany) (Note 7). 3,300 31,875
-----------
724,035
-----------
FOOD & KINDRED PRODUCTS - 8.60%
Bestfoods . . . . . . . . . . . . . . . . . . . 27,300 1,371,825
Diageo plc - ADR (Note 7) . . . . . . . . . . . 28,900 982,600
Flowers Industries, Inc.. . . . . . . . . . . . 1,200 18,300
H.J. Heinz Co.. . . . . . . . . . . . . . . . . 42,000 1,428,000
Unilever plc - ADR (Note 7) . . . . . . . . . . 67,082 1,668,665
-----------
5,469,390
-----------
FURNITURE & FIXTURES - 0.09%
Hillenbrand Industries, Inc.. . . . . . . . . . 1,825 54,978
-----------
GLASS PRODUCTS - 0.12%
Libbey, Inc.. . . . . . . . . . . . . . . . . . 1,400 42,700
Waterford Wedgewood - (United Kingdom) (Note 7) 37,000 35,897
-----------
78,597
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
27
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series II SHARES (NOTE 2)
-------------------------------------------------------- --------- -----------
<S> <C> <C>
GENERAL SURGICAL & MEDICAL HOSPITALS - 1.50%
Columbia/HCA Healthcare Corp.* . . . . . . . . . . . . . 5,350 $ 152,141
Health Management Associates, Inc.*. . . . . . . . . . . 3,425 54,586
Lifepoint Hospitals, Inc.* . . . . . . . . . . . . . . . 7,900 135,287
Province Healthcare Co.* . . . . . . . . . . . . . . . . 3,300 95,287
Quorum Health Group, Inc.* . . . . . . . . . . . . . . . 7,675 81,547
Tenet Healthcare Corp.*. . . . . . . . . . . . . . . . . 4,475 114,112
Triad Hospitals, Inc.* . . . . . . . . . . . . . . . . . 8,950 153,828
Universal Health Services, Inc. *. . . . . . . . . . . . 3,075 168,356
-----------
955,144
-----------
INDUSTRIAL & COMMERCIAL MACHINERY - 5.48%
Baker Hughes, Inc. . . . . . . . . . . . . . . . . . . . 54,500 1,733,781
Bell & Howell Co.* . . . . . . . . . . . . . . . . . . . 1,150 30,547
Compaq Computer Corp.. . . . . . . . . . . . . . . . . . 57,500 1,681,875
Moog Inc. - Class A* . . . . . . . . . . . . . . . . . . 1,025 24,152
PSC, Inc.. . . . . . . . . . . . . . . . . . . . . . . . 3,450 13,800
-----------
3,484,155
-----------
INVESTORS - 0.91%
Reed International plc - ADR (Note 7). . . . . . . . . . 20,300 581,088
-----------
MOTION PICTURE PRODUCTIONS - 0.08%
Alliance Atlantis Communications Corp.* (Canada)(Note 7) 4,300 53,545
-----------
NURSING CARE FACILITIES - 0.10%
Manor Care, Inc.*. . . . . . . . . . . . . . . . . . . . 5,375 64,164
-----------
PAPER & ALLIED PRODUCTS - 0.97%
Aracruz Cellulose SA - ADR (Note 7). . . . . . . . . . . 30,100 562,494
Smurfit-Stone Container Corp.* . . . . . . . . . . . . . 3,564 54,351
-----------
616,845
-----------
PRIMARY METAL INDUSTRIES - 1.04%
Intermet Corp. . . . . . . . . . . . . . . . . . . . . . 3,600 26,550
Phelps Dodge Corp. . . . . . . . . . . . . . . . . . . . 12,000 555,000
Texas Industries, Inc. . . . . . . . . . . . . . . . . . 2,400 78,300
-----------
659,850
-----------
RETAIL SPECIALTY STORES - 0.06%
Hancock Fabrics, Inc.. . . . . . . . . . . . . . . . . . 5,775 22,739
Syms Corp. . . . . . . . . . . . . . . . . . . . . . . . 3,300 13,200
-----------
35,939
-----------
RUBBER & MISCELLANEOUS PLASTIC PRODUCTS - 0.06%
Applied Extrusion Technologies, Inc. . . . . . . . . . . 5,200 37,375
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
28
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Blended Asset Series II SHARES (NOTE 2)
------------------------------------------------ ---------- -----------
<S> <C> <C>
SOCIAL SERVICES - 0.25%
Alterra Healthcare Corp.*. . . . . . . . . . . . 10,775 $ 35,019
American Retirement Corp.* . . . . . . . . . . . 8,650 64,875
Brookdale Living Communities, Inc.*. . . . . . . 1,250 16,094
Emeritus Corp.*. . . . . . . . . . . . . . . . . 2,050 8,200
Sunrise Assisted Living, Inc.* . . . . . . . . . 2,250 35,437
-----------
159,625
-----------
TECHNICAL INSTRUMENTS & SUPPLIES - 4.70%
Baxter International, Inc. . . . . . . . . . . . 775 50,472
Beckman Coulter, Inc.. . . . . . . . . . . . . . 650 42,128
Becton, Dickinson & Co.. . . . . . . . . . . . . 2,775 71,109
Eastman Kodak Co.. . . . . . . . . . . . . . . . 50,425 2,820,648
Edwards Lifesciences Corp. . . . . . . . . . . . 155 2,325
-----------
2,986,682
-----------
TELECOMMUNICATION SERVICES - 1.35%
Sinclair Broadcast Group, Inc.*. . . . . . . . . 4,800 37,500
Telecomunicacoes Brasileiras S.A. (Telebras) -
ADR PFD (Note 7). . . . . . . . . . . . . . 6,965 823,176
-----------
860,676
-----------
TESTING LABORATORIES - 0.04%
Paradigm Geophysical Ltd.* . . . . . . . . . . . 4,500 26,156
-----------
TEXTILE MILL PRODUCTS - 0.06%
Albany International Corp. - Class A . . . . . . 2,440 37,058
-----------
TRANSPORTATION - 6.10%
EQUIPMENT - 1.16%
Newport New Shipbuilding, Inc. . . . . . . . 650 21,694
Northrop Grumman Corp. . . . . . . . . . . . 10,100 715,837
-----------
737,531
-----------
RAILROAD - 4.87%
Burlington Northern Santa Fe Corp. . . . . . 64,800 1,563,300
Canadian National Railway Co. - ADR (Note 7) 51,300 1,439,606
Genesee & Wyoming, Inc.* . . . . . . . . . . 3,900 59,475
Westinghouse Air Brake Co. . . . . . . . . . 2,575 29,130
-----------
3,091,511
-----------
WATER - 0.07%
Trico Marine Services, Inc.* . . . . . . . . 5,600 42,350
-----------
3,871,392
-----------
TOTAL COMMON STOCK
(Identified Cost $36,000,699). . . . . . . . . . 35,796,424
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
29
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT/ VALUE
Blended Asset Series II SHARES (NOTE 2)
--------------------------------------- ----------- ------------
<S> <C> <C>
U.S. TREASURY SECURITIES - 36.47%
U.S. TREASURY BONDS - 18.90%
U.S. Treasury Bond, 6.875%, 8/15/2025 . $ 330,000 $ 356,916
U.S. Treasury Bond, 6.5%, 11/15/2026. . 440,000 456,500
U.S. Treasury Bond, 5.50%, 8/15/2028. . 12,325,000 11,208,047
------------
TOTAL U.S. TREASURY BONDS
(Identified Cost $11,475,445). . . . 12,021,463
-----------
U.S. TREASURY NOTES - 17.57%
U.S. Treasury Note, 4.25%, 11/15/2003 . 4,580,000 4,249,384
U.S. Treasury Note, 5.875%, 11/15/2004. 7,000,000 6,816,250
U.S. Treasury Note, 6.50%, 5/15/2005. . 105,000 104,836
------------
TOTAL U.S. TREASURY NOTES
(Identified Cost $11,489,368). . . . 11,170,470
------------
TOTAL U.S. TREASURY SECURITIES
(Identified Cost $22,964,813). . . . 23,191,933
------------
U.S. GOVERNMENT AGENCIES - 5.01%
Federal National Mortgage Association
Note, 5.25%, 1/15/2003 . . . . . . . 165,000 157,208
Federal National Mortgage Association
Note, 5.75%, 2/15/2008 . . . . . . . 185,000 167,739
Federal National Mortgage Association
Note, 6.625%, 9/15/2009. . . . . . . 3,000,000 2,858,049
------------
TOTAL U.S. GOVERNMENT AGENCIES
(Identified Cost $3,231,190) . . . . 3,182,996
------------
SHORT-TERM INVESTMENTS - 1.45%
Dreyfus Treasury Cash Management Fund
(Identified Cost $923,481) . . . . . . 923,481 923,481
------------
TOTAL INVESTMENTS - 99.23%
(Identified Cost $63,120,183). . . . 63,094,834
OTHER ASSETS, LESS LIABILTIES - 0.77% . 489,408
------------
NET ASSETS - 100% . . . . . . . . . . . $63,584,242
===========
</TABLE>
*Non-income producing security
Federal Tax Information:
At April 30, 2000, the net unrealized depreciation based on identified cost for
federal income tax purposes of $63,120,183 was as follows:
<TABLE>
<CAPTION>
<S> <C>
Unrealized appreciation . . . $ 4,475,305
Unrealized depreciation . . . (4,500,654)
------------
UNREALIZED DEPRECIATION - NET ($25,349)
============
</TABLE>
The accompanying notes are an integral part of the financial statements.
30
<PAGE>
Statement of Assets and Liabilities - Blended Asset Series II (unaudited)
<TABLE>
<CAPTION>
APRIL 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $63,120,183)(Note 2). $63,094,834
CASH . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191,500
Receivable for securities sold . . . . . . . . . . . . . . . 655,892
Interest receivable. . . . . . . . . . . . . . . . . . . . . 491,695
Dividends receivable . . . . . . . . . . . . . . . . . . . . 97,687
Receivable for fund shares sold. . . . . . . . . . . . . . . 3,429
Tax reclaims receivable. . . . . . . . . . . . . . . . . . . 545
------------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . 64,535,582
------------
LIABILITIES:
Accrued management fees (Note 3) . . . . . . . . . . . . . . 52,108
Accrued directors' fees (Note 3) . . . . . . . . . . . . . . 4,041
Accrued fund accounting fees (Note 3). . . . . . . . . . . . 3,672
Transfer agent fees payable (Note 3) . . . . . . . . . . . . 1,251
Payable for securities purchased . . . . . . . . . . . . . . 780,248
Payable for fund shares repurchased. . . . . . . . . . . . . 90,974
Printing and postage payable . . . . . . . . . . . . . . . . 8,791
Other payables and accrued expenses. . . . . . . . . . . . . 10,255
------------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . . 951,340
------------
NET ASSETS FOR 4,850,610 SHARES OUTSTANDING. . . . . . . . . $63,584,242
============
NET ASSETS CONSIST OF:
Capital stock. . . . . . . . . . . . . . . . . . . . . . . . $ 48,506
Additional paid-in-capital . . . . . . . . . . . . . . . . . 59,594,480
Undistributed net investment income. . . . . . . . . . . . . 737,000
Accumulated net realized gain on investments . . . . . . . . 3,229,920
Net unrealized depreciation on investments and other assets
and liabilities . . . . . . . . . . . . . . . . . . . . (25,664)
------------
TOTAL NET ASSETS . . . . . . . . . . . . . . . . . . . . . . $63,584,242
============
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($63,584,242/4,850,610 shares). . . . . . . . . . . . . . $ 13.11
============
</TABLE>
The accompanying notes are an integral part of the financial statements.
31
<PAGE>
Statement of Operations - Blended Asset Series II (unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 818,718
Dividends (net of foreign taxes withheld, $8,681). . . . . . . . 420,482
----------
Total Investment Income. . . . . . . . . . . . . . . . . . . . . 1,239,200
----------
EXPENSES:
Management fees (Note 3) . . . . . . . . . . . . . . . . . . . . 318,808
Fund accounting fees (Note 3). . . . . . . . . . . . . . . . . . 3,672
Directors' fees (Note 3) . . . . . . . . . . . . . . . . . . . . 3,591
Transfer agent fees (Note 3) . . . . . . . . . . . . . . . . . . 7,651
Custodian fee. . . . . . . . . . . . . . . . . . . . . . . . . . 12,715
Audit fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,653
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . 16,461
----------
Total Expenses . . . . . . . . . . . . . . . . . . . . . . . . . 372,551
----------
NET INVESTMENT INCOME. . . . . . . . . . . . . . . . . . . . . . 866,649
----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments and other assets . . . . . . . 3,423,110
Net change in unrealized appreciation on investments
and other assets. . . . . . . . . . . . . . . . . . . . . . 2,052,987
----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS. . . . . . . . . 5,476,097
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . $6,343,746
==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
32
<PAGE>
Statements of Changes in Net Assets - Blended Asset Series II (unaudited)
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS FOR THE
ENDED YEAR
4/30/00 ENDED
(UNAUDITED) 10/31/99
------------ ---------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . . . . . . $ 866,649 $ 1,716,248
Net realized gain on investments . . . . . . . . . . . 3,423,110 3,482,912
Net change in unrealized appreciation on investments . 2,052,987 1,892,935
------------ ------------
Net increase from operations . . . . . . . . . . . . . 6,342,746 7,092,095
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . . . . . (1,003,478) (1,640,967)
From net realized gain on investments. . . . . . . . . (3,441,044) (4,195,324)
------------ ------------
Total distributions to shareholders. . . . . . . . . . (4,444,522) (5,836,291)
------------ ------------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net decrease from capital
share transactions (Note 5) . . . . . . . . . . . . (3,518,728) (2,024,080)
------------ ------------
Net decrease in net assets . . . . . . . . . . . . . . (1,620,504) (768,276)
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . . . 65,204,746 65,973,022
------------ ------------
END OF PERIOD (including undistributed net investment
income of $737,000 and $873,967, respectively) . . $63,584,242 $65,204,746
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
33
<PAGE>
Financial Highlights - Blended Asset Series II
<TABLE>
<CAPTION>
FOR THE FOR THE
SIX MONTHS FOR THE FOR THE FOR THE TEN FOR THE
ENDED YEAR YEAR YEAR MONTHS YEAR
4/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 12/31/95
------------ ------------ ---------- ---------- ---------- ----------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . . . . . . $ 12.74 $ 12.60 $ 14.69 $ 13.04 $ 11.95 $ 10.12
------------ ---------- ---------- ---------- ---------- ---------
Income from investment operations:
Net investment income . . . . . . . . . . . . . . 0.19 0.33 0.31 0.32 0.23* 0.24*
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . 1.08 0.92 (0.38) 2.13 0.96 3.05
------------ ---------- ---------- ---------- ---------- ---------
Total from investment operations . . . . . . . . . . 1.27 1.25 (0.07) 2.45 1.19 3.29
------------ ---------- ---------- ---------- ---------- ---------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . (0.21) (0.31) (0.29) (0.39) (0.04) (0.24)
From net realized gain on investments . . . . . . (0.69) (0.80) (1.73) (0.41) (0.06) (1.22)
------------ ---------- ---------- ---------- ---------- ---------
Total distributions to shareholders. . . . . . . . . (0.90) (1.11) (2.02) (0.80) (0.10) (1.46)
------------ ---------- ---------- ---------- ---------- ---------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ 13.11 $ 12.74 $ 12.60 $ 14.69 $ 13.04 $ 11.95
============ ========== ========== ========== ========== =========
Total return1. . . . . . . . . . . . . . . . . . . . 10.47% 10.46% (0.56%) 19.69% 10.01% 32.64%
Ratios (to average net assets) / Supplemental Data:
Expenses . . . . . . . . . . . . . . . . . . . . 1.17%2 1.15% 1.15% 1.15% 1.20%2* 1.20%*
Net investment income. . . . . . . . . . . . . . 2.72%2 2.44% 2.45% 2.45% 2.51%2* 2.53%*
Portfolio turnover . . . . . . . . . . . . . . . . . 47% 78% 61% 63% 57% 63%
NET ASSETS - END OF PERIOD (000's omitted) . . . . . $ 63,584 $ 65,205 $ 65,973 $ 50,922 $ 32,999 $ 20,519
============ ========== ========== ========== ========== =========
</TABLE>
* The investment advisor did not impose all or a portion of its management fee
and in some periods paid a portion of the Series' expenses. If these expenses
had been incurred by the Series, the net investment income per share and the
ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Net investment income . . . . . N/A N/A N/A N/A $ 0.22 $0.23
Ratios (to average net assets):
Expenses . . . . . . . . . . N/A N/A N/A N/A 1.22%2 1.33%
Net investment income. . . . N/A N/A N/A N/A 2.49%2 2.40%
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
The accompanying notes are an integral part of the financial statements.
34
<PAGE>
Performance Update as of April 30, 2000 (unaudited)
Exeter Fund, Inc. - Maximum Horizon Series
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $11,672 16.72% 16.72%
Inception 1 $20,316 103.16% 17.05%
</TABLE>
<TABLE>
<CAPTION>
Standard & Poor's 500 Total Return Index
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $11,012 10.12% 10.12%
Inception 1 $26,934 169.34% 24.62%
</TABLE>
Value Line Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
04/30/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $ 9,423 -5.77% -5.77%
Inception 1 $13,162 31.62% 6.29%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Maximum Horizon
Series from its inception (11/1/95) to present (4/30/00) as compared to the
Standard & Poor's (S&P) 500 Total Return Index and the Value Line Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Standard & Poor's
Maximum Horizon 500 Total Value Line
Date Series Return Index Index
<S> <C> <C> <C>
11/01/1995 10,000 10,000 10,000
10/31/1996 11,521 12,408 11,198
10/31/1997 14,604 16,392 13,998
10/31/1998 13,730 19,996 12,805
10/31/1999 17,345 25,127 13,001
04/30/2000 20,316 26,934 13,162
</TABLE>
1 The Fund and Index performance are calculated from November 1, 1995, the
Fund's inception date. The Fund's performance is historical and may not be
indicative of future results.
2 The Standard & Poor's (S&P) 500 Total Return Index is an unmanaged
capitalization-weighted measure of approximately 500 widely held common stocks
listed on the New York Stock Exchange, American Stock Exchange, and
Over-the-Counter market. The Index returns assume reinvestment of income and,
unlike Fund returns, do not reflect any fees or expenses. The Value Line Index
is an unmanaged index that consists of approximately 1700 securities that are
traded on the New York Stock Exchange, the NASDAQ Stock Market, and the American
Stock Exchange. The Index returns are based on a geometric average of relative
price changes of the component stocks and do not include income, and unlike Fund
returns, do not reflect any fees or expenses.
35
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Maximum Horizon Series SHARES (NOTE 2)
----------------------------------------------------- --------- -----------
COMMON STOCK - 87.62%
<S> <C> <C>
AGRICULTURAL PRODUCTION - 0.10%
Sylvan, Inc.* . . . . . . . . . . . . . . . . . . . . 3,250 $ 26,812
-----------
APPAREL - 3.32%
Adidas - Solomon AG (Germany) (Note 7). . . . . . . . 14,100 889,126
-----------
BUSINESS SERVICES - 1.40%
National Data Corp. . . . . . . . . . . . . . . . . . 13,500 374,625
-----------
CHEMICAL & ALLIED PRODUCTS - 16.13%
AGRICULTURAL PRODUCTS - 0.17%
Agruim, Inc. (Note 7). . . . . . . . . . . . . . . 2,000 18,750
Mississippi Chemical Corp. . . . . . . . . . . . . 3,425 26,330
-----------
45,080
-----------
BIOLOGICAL PRODUCTS - 4.90%
Connetics Corp . . . . . . . . . . . . . . . . . . 2,836 8,075
Cypress Bioscience, Inc.*. . . . . . . . . . . . . 17,300 37,844
FMC Corp.. . . . . . . . . . . . . . . . . . . . . 10,300 599,331
PathoGenesis Corp.*. . . . . . . . . . . . . . . . 2,000 42,500
Sigma-Aldrich Corp.. . . . . . . . . . . . . . . . 21,200 622,750
-----------
1,310,500
-----------
PHARMACEUTICAL PREPARATIONS - 6.11%
Abbot Laboratories . . . . . . . . . . . . . . . . 425 16,336
American Home Products Corp. . . . . . . . . . . . 150 8,428
Instrumentarium Oyj Corp. (Finland) (Note 7) . . . 9 253
Johnson & Johnson. . . . . . . . . . . . . . . . . 200 16,500
Merck KgaA (Germany) (Note 7). . . . . . . . . . . 450 12,958
Mylan Laboratories, Inc. . . . . . . . . . . . . . 38,600 1,095,275
Orion-Yhtyma Oyj - B Shares (Finland) (Note 7) . . 470 10,943
Pharmacia Corp.. . . . . . . . . . . . . . . . . . 1,148 57,328
Teva Pharmaceutical Industries Ltd. - ADR (Note 7) 9,100 400,400
Warner-Lambert Co. . . . . . . . . . . . . . . . . 75 8,536
Watson Pharmaceutical, Inc.. . . . . . . . . . . . 200 8,987
-----------
1,635,944
-----------
PAINTS & ALLIED PRODUCTS - 2.16%
Sherwin Williams Co. . . . . . . . . . . . . . . . 23,200 577,100
-----------
PLASTIC MATERIALS - 2.79%
Eastman Chemical Co. . . . . . . . . . . . . . . . 14,275 746,761
-----------
4,315,385
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
36
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Maximum Horizon Series SHARES (NOTE 2)
-------------------------------------------------- --------- ---------
<S> <C> <C>
COMPUTER INTEGRATED SYSTEMS - 3.03%
Cerner Corp. . . . . . . . . . . . . . . . . . . . 225 $ 4,964
Parametric Technology Corp.. . . . . . . . . . . . 96,900 790,341
Shared Medical Technology Corp.. . . . . . . . . . 375 15,539
---------
810,844
---------
CRUDE PETROLEUM & NATURAL GAS - 6.84%
Gulf Canada Resources Ltd. - ADR* (Note 7) . . . . 148,075 610,809
Halliburton Co.. . . . . . . . . . . . . . . . . . 12,300 543,506
Petroleo Brasileiro S.A. (Petrobras) -ADR (Note 7) 27,025 640,260
Stolt Comex Seaway, SA* (Note 7) . . . . . . . . . 3,000 36,188
---------
1,830,763
---------
ELECTRIC, GAS & SANITARY SERVICES - 5.10%
CH Energy Group, Inc.. . . . . . . . . . . . . . . 1,100 36,231
Cinergy Corp.. . . . . . . . . . . . . . . . . . . 8,900 238,075
Conectiv, Inc. . . . . . . . . . . . . . . . . . . 12,300 218,325
FirstEnergy Corp.. . . . . . . . . . . . . . . . . 10,700 272,181
Newpark Resources, Inc.* . . . . . . . . . . . . . 3,950 32,587
PPL Corp.. . . . . . . . . . . . . . . . . . . . . 13,800 329,475
Potomac Electric Power Co. . . . . . . . . . . . . 10,100 236,719
---------
1,363,593
---------
ELECTRONICS & ELECTRICAL EQUIPMENT - 1.17%
The Carbide/Graphite Group, Inc.*. . . . . . . . . 2,575 9,012
Raytheon Co - Class A. . . . . . . . . . . . . . . 13,250 303,922
---------
312,934
---------
FABRICATED METAL PRODUCTS - 1.69%
Alliant Techsystems, Inc.. . . . . . . . . . . . . 350 24,369
American National Can Group. . . . . . . . . . . . 2,000 33,625
Lockheed Martin Corp.. . . . . . . . . . . . . . . 14,700 365,662
Norddeutsche Affinier AG (Germany) (Note 7). . . . 3,025 29,219
---------
452,875
---------
FOOD & BEVERAGES - 9.88%
Bestfoods. . . . . . . . . . . . . . . . . . . . . 19,000 954,750
Diageo plc - ADR (Note 7). . . . . . . . . . . . . 13,000 442,000
Flowers Industries, Inc. . . . . . . . . . . . . . 1,075 16,394
H.J. Heinz Co. . . . . . . . . . . . . . . . . . . 18,800 639,200
Unilever plc - ADR (Note 7). . . . . . . . . . . . 23,696 589,438
---------
2,641,782
---------
FURNITURE & FIXTURES - 0.10%
Hillenbrand Industries, Inc. . . . . . . . . . . . 875 26,359
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
37
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Maximum Horizon Series SHARES (NOTE 2)
-------------------------------------------- --------- -----------
<S> <C> <C>
GENERAL SURGICAL & MEDICAL HOSPITALS - 3.39%
Columbia/HCA Healthcare Corp.* . . . . . . . 8,725 $ 248,117
Health Management Associates, Inc.*. . . . . 2,050 32,672
Lifepoint Hospital, Inc.*. . . . . . . . . . 3,400 58,225
Province Healthcare Co.* . . . . . . . . . . 5,750 166,031
Quorum Health Group, Inc.* . . . . . . . . . 4,900 52,062
Tenet Healthcare Corp.*. . . . . . . . . . . 7,450 189,975
Triad Hospitals, Inc.* . . . . . . . . . . . 4,200 72,187
Universal Health Services, Inc.* . . . . . . 1,575 86,231
-----------
905,500
-----------
GLASS PRODUCTS - 0.33%
Libbey, Inc. . . . . . . . . . . . . . . . . 1,675 51,087
Waterford Wedgwood (United Kingdom) (Note 7) 38,150 37,012
88,099
-----------
INDUSTRIAL & COMMERCIAL MACHINERY - 4.93%
Baker Hughes, Inc. . . . . . . . . . . . . . 18,300 582,169
Bell & Howell Co.* . . . . . . . . . . . . . 1,100 29,219
Compaq Computer Corp.. . . . . . . . . . . . 23,200 678,600
Moog, Inc. - Class A . . . . . . . . . . . . 700 16,494
PSC, Inc.. . . . . . . . . . . . . . . . . . 3,200 12,800
-----------
1,319,282
-----------
INVESTORS - 2.32%
Reed International plc - ADR (Note 7). . . . 21,700 621,162
-----------
MOTION PICTURE PRODUCTION - 0.25%
Alliance Atlantis Communications Corp.*
(Canada) (Note 7). . . . . . . . . . . . . 5,400 67,242
-----------
NURSING CARE FACILITIES - 0.13%
Manor Care, Inc.*. . . . . . . . . . . . . . 2,875 34,320
-----------
PAPER & ALLIED PRODUCTS - 9.13%
Aracruz Celulose S.A. - ADR (Note 7) . . . . 27,950 522,316
Fort James Corp. . . . . . . . . . . . . . . 13,200 315,975
International Paper Co.. . . . . . . . . . . 28,300 1,040,025
Kimberly-Clark Corp. . . . . . . . . . . . . 8,675 503,692
Smurfit-Stone Container Corp.* . . . . . . . 4,005 61,076
-----------
2,443,084
-----------
PRIMARY METAL INDUSTRIES - 3.62%
Intermet Corp. . . . . . . . . . . . . . . . 2,950 21,756
Phelps Dodge Corp. . . . . . . . . . . . . . 8,000 370,000
Texas Industries, Inc. . . . . . . . . . . . 17,625 575,016
-----------
966,772
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
38
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
VALUE
Maximum Horizon Series SHARES (NOTE 2)
----------------------------------------------- --------- ---------
<S> <C> <C>
RETAIL - SPECIALTY STORES - 0.15%
Hancock Fabrics, Inc. . . . . . . . . . . . . . 7,100 $ 27,956
Syms Corp.. . . . . . . . . . . . . . . . . . . 2,700 10,800
---------
38,756
---------
RUBBER & MISCELLANEOUS PLASTIC PRODUCTS - 0.14%
Applied Extrusion Technologies, Inc.. . . . . . 5,175 37,195
---------
SOCIAL SERVICES - 0.40%
Alterra Healthcare Corp.* . . . . . . . . . . . 4,750 15,438
American Retirement Corp.*. . . . . . . . . . . 8,450 63,375
Brookdale Living Communities, Inc.* . . . . . . 500 6,437
Emeritus Corp.* . . . . . . . . . . . . . . . . 1,100 4,400
Sunrise Assisted Living, Inc.*. . . . . . . . . 1,175 18,506
---------
108,156
---------
SOFTWARE - 1.80%
Computer Associates International, Inc.*. . . . 8,625 481,383
---------
TECHNICAL INSTRUMENTS & SUPPLIES - 4.00%
Baxter International, Inc.. . . . . . . . . . . 375 24,422
Beckman Coulter, Inc. . . . . . . . . . . . . . 250 16,203
Becton, Dickinson & Co. . . . . . . . . . . . . 1,175 30,109
Eastman Kodak Co. . . . . . . . . . . . . . . . 17,840 997,925
Edwards Lifesciences Corp.. . . . . . . . . . . 75 1,125
---------
1,069,784
---------
TELECOMMUNICATION SERVICES - 1.59%
Sinclair Broadcast Group, Inc.* . . . . . . . . 4,075 31,836
Telecomunicacoes Brasileiras S.A. (Telebras) -
ADR PFD (Note 7) . . . . . . . . . . . . . . 3,325 392,973
---------
424,809
---------
TESTING LABORATORIES - 0.13%
Paradigm Geophysical Ltd.*. . . . . . . . . . . 6,175 35,892
---------
TEXTILE MILL PRODUCTS - 0.18%
Albany International Corp. - Class A. . . . . . 3,235 49,131
---------
TRANSPORTATION - 6.37%
EQUIPMENT - 1.59%
Newport News Shipbuilding, Inc. . . . . . . 650 21,694
Northrup Grumman Corp. . . . . . . . . . . 5,700 403,987
---------
425,681
---------
</TABLE>
The accompanying notes are an integral part of the financial statements.
39
<PAGE>
Investment Portfolio - April 30, 2000 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT/ VALUE
Maximum Horizon Series SHARES (NOTE 2)
----------------------------------------------- ----------- -----------
<S> <C> <C>
TRANSPORTATION (continued)
RAILROAD - 4.59%
Burlington Northern Santa Fe Corp. . . . . . 21,200 $ 511,450
Canadian National Railway Co. - ADR (Note 7) 24,550 688,934
Westinghouse Air Brake Co.. . . . . . . . . 2,450 27,716
-----------
1,228,100
-----------
WATER - 0.19%
Trico Marine Services, Inc.* . . . . . . . . 6,750 51,045
-----------
1,704,826
-----------
TOTAL COMMON STOCK
(Identified Cost $23,369,339). . . . . . . . 23,440,500
-----------
U.S. TREASURY SECURITIES - 4.73%
U.S. Treasury Bond, 6.50%, 11/15/2026 . . . . . $ 255,000 264,562
U.S. Treasury Bond, 5.50%, 08/15/2028 . . . . . 1,100,000 1,000,313
-----------
TOTAL U.S. TREASURY SECURITIES
(Identified Cost $1,213,713) . . . . . . . 1,264,875
-----------
SHORT-TERM INVESTMENTS - 7.59%
Dreyfus Treasury Cash Management Fund . . . . . 1,037,201 1,037,201
Federal National Mortgage Association Discount
Note, 6/12/2000. . . . . . . . . . . . . . . 1,000,000 992,813
-----------
TOTAL SHORT-TERM INVESTMENTS
(Identified Cost $2,030,014) . . . . . . . . 2,030,014
-----------
TOTAL INVESTMENTS - 99.93%
(Identified Cost $26,613,066). . . . . . . . 26,735,389
OTHER ASSETS, LESS LIABILITIES - 0.07%. . . . . 18,050
-----------
NET ASSETS - 100% . . . . . . . . . . . . . . . $26,753,439
============
</TABLE>
*Non-income producing security
Federal Tax Information:
At April 30, 2000, the net unrealized appreciation based on identified cost for
federal income tax purposes of $26,613,066 was as follows:
Unrealized appreciation $2,400,939
Unrealized depreciation (2,278,616)
-----------
UNREALIZED APPRECIATION - NET $ 122,323
==========
The accompanying notes are an integral part of the financial statements.
40
<PAGE>
Statement of Assets and Liabilities - Maximum Horizon Series (unaudited)
<TABLE>
<CAPTION>
APRIL 30, 2000
ASSETS:
<S> <C>
Investments, at value (identified cost $26,613,066)(Note 2). $26,735,389
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339,143
Receivable for securities sold . . . . . . . . . . . . . . . 214,913
Interest receivable. . . . . . . . . . . . . . . . . . . . . 26,867
Dividends receivable . . . . . . . . . . . . . . . . . . . . 49,820
Tax reclaims receivable. . . . . . . . . . . . . . . . . . . 337
------------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . 27,366,469
------------
LIABILITIES:
Accrued management fees (Note 3) . . . . . . . . . . . . . . 72,084
Accrued directors' fees (Note 3) . . . . . . . . . . . . . . 4,042
Accrued fund accounting fees (Note 3). . . . . . . . . . . . 3,672
Transfer agent fees payable (Note 3) . . . . . . . . . . . . 1,029
Payable for securities purchased . . . . . . . . . . . . . . 467,022
Payable for fund shares repurchased. . . . . . . . . . . . . 57,261
Audit fee payable. . . . . . . . . . . . . . . . . . . . . . 6,215
Other payables and accrued expenses. . . . . . . . . . . . . 1,705
------------
TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . . 613,030
------------
NET ASSETS FOR 1,774,341 SHARES OUTSTANDING. . . . . . . . . $26,753,439
============
NET ASSETS CONSIST OF:
Capital stock. . . . . . . . . . . . . . . . . . . . . . . . $ 17,744
Additional paid-in-capital . . . . . . . . . . . . . . . . . 23,069,835
Undistributed net investment loss. . . . . . . . . . . . . . (33,641)
Accumulated net realized gain on investments and other
assets and liabilities. . . . . . . . . . . . . . . . . 3,577,345
Net unrealized appreciation on investments and other assets
and liabilities. . . . . . . . . . . . . . . . . . . . . 122,156
------------
TOTAL NET ASSETS . . . . . . . . . . . . . . . . . . . . . . $26,753,439
============
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($26,753,439/1,774,341 shares). . . . . . . . . . . . . . $ 15.08
============
</TABLE>
The accompanying notes are an integral part of the financial statements.
41
<PAGE>
Statement of Operations - Maximum Horizon Series (unaudited)
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED APRIL 30, 2000
INVESTMENT INCOME:
<S> <C>
Dividends (net of foreign tax withheld, $2,861). . . . . . . . . $ 198,409
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98,782
-----------
Total Investment Income. . . . . . . . . . . . . . . . . . . . . 297,191
-----------
EXPENSES:
Management fees (Note 3) . . . . . . . . . . . . . . . . . . . . 119,161
Fund accounting fees (Note 3). . . . . . . . . . . . . . . . . . 3,672
Directors' fees (Note 3) . . . . . . . . . . . . . . . . . . . . 3,591
Transfer agent fees (Note 3) . . . . . . . . . . . . . . . . . . 2,860
Registration and filing fees . . . . . . . . . . . . . . . . . . 6,483
Audit fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,236
Custodian fee. . . . . . . . . . . . . . . . . . . . . . . . . . 5,236
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . 3,978
-----------
Total Expenses . . . . . . . . . . . . . . . . . . . . . . . . . 150,217
Less Reduction of Expenses (Note 3). . . . . . . . . . . . . . . (7,073)
-----------
Net Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 143,144
-----------
NET INVESTMENT INCOME. . . . . . . . . . . . . . . . . . . . . . 154,047
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on investments and other assets. . . . . . . . 3,604,382
Net change in unrealized appreciation on investments
and other assets. . . . . . . . . . . . . . . . . . . . . . . (110,033)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS. . . . . . . . . . . . . . . . . . . . . . . . 3,494,349
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . $3,648,396
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
42
<PAGE>
Statements of Changes - Maximum Horizon Series
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS FOR THE
ENDED YEAR
04/30/00 ENDED
(UNAUDITED) 10/31/99
------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income . . . . . . . . . . . . $ 154,047 $ 204,473
Net realized gain on investments. . . . . . . 3,604,382 2,187,613
Net change in unrealized appreciation on
investments. . . . . . . . . . . . . . . (110,033) 2,706,385
------------ ------------
Net increase from operations. . . . . . . . . 3,648,396 5,098,471
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income. . . . . . . . . . (239,796) (344,505)
From net realized gain on investments . . . . (2,101,339) (911,021)
------------ ------------
Total distributions to shareholders . . . . . (2,341,135) (1,255,526)
------------ ------------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net increase (decrease) from capital share
transactions (Note 5). . . . . . . . . . . 3,931,471 (1,032,795)
------------ ------------
Net increase in net assets. . . . . . . . . . 5,238,732 2,810,150
NET ASSETS:
Beginning of period . . . . . . . . . . . . . 21,514,707 18,704,557
------------ ------------
END OF PERIOD (including undistributed net
investment income of ($33,641) and $52,108,
respectively). . . . . . . . . . . . . . . . $26,753,439 21,514,707
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
43
<PAGE>
FINANCIAL HIGHLIGHTS - MAXIMUM HORIZON SERIES
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED
04/30/00 FOR THE YEAR ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96
-------------- ------------------- ----------- ---------- ---------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . $ 14.33 $ 12.10 $ 14.24 $ 11.38 $10.00
-------------- -------------------- ---------- ---------- -------
Income from investment operations:
Net investment income*. . . . . . . . . 0.11 0.18 0.13 0.10 0.15
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . 2.24 3.06 (0.93) 2.92 1.36
-------------- -------------------- ---------- ---------- -------
Total from investment operations . . . . . 2.35 3.24 (0.80) 3.02 1.51
-------------- -------------------- ---------- ---------- -------
Less distributions to shareholders:
From net investment income . . . . . . . (0.16) (0.22 (0.12) (0.08) (0.13)
From net realized gain on investments. . (1.44) (0.79) (1.22) (0.08) --
-------------- -------------------- ---------- ---------- -------
Total distributions to shareholders. . . . (1.60) (1.01) (1.34) (0.16) (0.13)
-------------- -------------------- ---------- ---------- -------
NET ASSET VALUE - END OF PERIOD. . . . . . $ 15.08 $ 14.33 $ 12.10 $ 14.24 $11.38
============== ==================== ========== ========== =======
Total return1. . . . . . . . . . . . . . . 17.13% 26.34% (5.99%) 26.77% 15.21%
Ratios (to average net assets) /
Supplemental Data:
Expenses*. . . . . . . . . . . . . . . 1.20%2 1.20% 1.20% 1.20% 1.20%
Net investment income* . . . . . . . . 1.29%2 0.93% 1.25% 0.94% 1.71%
Portfolio turnover . . . . . . . . . . . . 94% 96% 60% 115% 95%
NET ASSETS - END OF PERIOD
(000's omitted) . . . . . . . . . . . . . $ 26,753 $ 21,515 $ 18,705 $ 9,852 $1,574
============== ==================== ========== ========== =======
</TABLE>
* The investment advisor did not impose all or a portion of its management fee
and in some periods paid a portion of the Series' expenses. If these expenses
had been incurred by the Series, and had 1996 expenses been limited to that
allowed by state securities law, the net investment income per share and the
ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Net investment income . . . . . $ 0.10 $0.17 $0.12 $0.06 $0.04
Ratios (to average net assets):
Expenses . . . . . . . . . . 1.26%2 1.28% 1.32% 1.55% 2.50%
Net investment income. . . . 1.23%2 0.85% 1.13% 0.59% 0.41%
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
The accompanying notes are an integral part of the financial statements.
44
<PAGE>
Notes to Financial Statements (unaudited)
1. ORGANIZATION
Defensive Series, Blended Asset Series I, Blended Asset Series II, and Maximum
Horizon Series (each the "Series") are no-load diversified series of Exeter
Fund, Inc. (the "Fund"). The Fund is organized in Maryland and is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company.
Each Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Currently, only Class A shares have been issued. Each class of shares is
substantially the same, except that class-specific distribution and shareholder
servicing expenses are borne by the specific class of shares to which they
relate.
The total authorized capital stock of the Fund consists of 1.7 billion shares of
common stock each having a par value of $0.01. As of April 30, 2000, 1.4
billion shares have been designated in total among 28 series, of which 37.5
million each have been designated as Defensive Series Class A, Blended Asset
Series I Class A, and Blended Asset Series II Class A Common Stock, and 75
million have been designated as Maximum Horizon Series Class A Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities, including domestic equities, foreign equities, options and
corporate bonds, listed on an exchange are valued at the latest quoted sales
price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities, will
normally be valued on the basis of evaluated bid prices provided by the Fund's
pricing service.
Securities for which representative valuations or prices are not available from
the Fund's pricing service are valued at fair value as determined in good faith
by the Advisor under procedures established by and under the general supervision
and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at amortized
cost which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are purchased
or sold. Dividend income is recorded on the ex-dividend date. Interest income
and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the series in the
Fund.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent that the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
The Series uses the identified cost method for determining realized gain or loss
on investments for both financial statement and federal income tax reporting
purposes.
45
<PAGE>
Notes to Financial Statements (unaudited)
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
DISTRIBUTIONS OF INCOME AND GAINS
Distributions to shareholders of net investment income are made semi-annually.
Distributions of net realized gains are distributed annually. An additional
distribution may be necessary to avoid taxation of the Series. Distributions
are recorded on the ex-dividend date.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, foreign denominated investments, character
reclassification between net income and net gains, or other tax adjustments. As
a result, net investment income (loss) and net investment gain (loss) on
investment transactions for a reporting period may differ significantly from
distributions to shareholders during such period. As a result, the Series may
periodically make reclassifications among its capital accounts without impacting
the Series' net asset value. Any such reclassifications are not reflected in
the financial highlights.
FOREIGN CURRENCY TRANSLATION
The accounting records of the Series are maintained in U.S. dollars. Foreign
currency amounts are translated into U.S. dollars on the following basis: a)
investment securities, other assets and liabilities are converted to U.S.
dollars based upon current exchange rates; and b) purchases and sales of
securities and income and expenses are converted into U.S. dollars based upon
the currency exchange rates prevailing on the respective dates of such
transactions.
Gains and losses attributable to foreign currency exchange rates are recorded
for financial statement purposes as net realized gains and losses on
investments. The portion of both realized and unrealized gains and losses on
investments that result from fluctuations in foreign currency exchange rates is
not separately stated.
OTHER
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Series has an investment advisory agreement with Manning & Napier
Advisors, Inc., dba Exeter Asset Management (the "Advisor"), for which the
Series pays the Advisor a fee, computed daily and payable monthly, at an annual
rate of 0.80% for Defensive Series and 1.0% for Blended Asset Series I, Blended
Asset Series II and Maximum Horizon Series, of the Series' average daily net
assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel
of the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and fund administration services. The salaries of all officers of
the Fund and of all Directors who are "affiliated persons" of the Fund or of the
Advisor, and all personnel of the Fund or of the Advisor performing services
relating to research, statistical and investment activities are paid by the
Advisor.
46
<PAGE>
Notes to Financial Statements (unaudited)
3. TRANSACTIONS WITH AFFILIATES (continued)
The Advisor has contractually agreed to waive its fee and, if necessary, pay
other expenses of the Series in order to maintain total expenses for the Series
at no more than 1.00% for Defensive Series and 1.20% for Blended Asset Series I
and Maximum Horizon, of average daily net assets each year. Accordingly, the
Advisor waived fees of $18,076, $11,862, and $7,073, respectively, for the six
months ended April 30, 2000, which is reflected as a reduction of expenses on
the Statement of Operations.
The Advisor also acts as the transfer, dividend paying and shareholder
servicing agent for the Fund. For these services, the Series pays a fee which
is calculated as a percentage of the average daily net assets at an annual rate
of 0.024%.
Manning & Napier Investor Services, Inc., a registered broker-dealer
affiliate of the Advisor, acts as distributor for the Fund's shares. The
services of Manning & Napier Investor Services, Inc. are provided at no
additional cost to the Fund.
Effective April 2000 the Advisor became the Fund's accounting services agent.
For these services, the Fund will pay the Advisor a fee of 0.04% of each Series'
daily net assets calculated daily and payable monthly, with a minimum annual fee
of $48,000 per Series. In addition, the Fund will pay the Advisor an additional
annual fee of $10,000 for each additional class of a Series. The Advisor has
entered into an agreement with BISYS Fund Services Ohio, Inc. under which BISYS
will serve as sub-accounting services agent.
4. PURCHASES AND SALES OF SECURITIES
For the six months ended April 30, 2000, purchases and sales of securities
were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
Fund Other Issuer Government Other Issuers Government
---------------- ------------- ----------- -------------- -----------
<S> <C> <C> <C> <C>
Defensive. . . . $ 354,229 $ 676,359 $ 462,983 $ 640,196
Blended Asset I. 4,193,731 4,632,503 6,130,056 6,968,832
Blended Asset II 12,758,759 16,437,199 19,868,615 16,392,127
Maximum Horizon. 11,904,748 9,877,962 11,563,769 8,813,174
</TABLE>
47
<PAGE>
Notes to Financial Statements (unaudited)
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of Class A Common Stock were:
<TABLE>
<CAPTION>
For the Six Months For the Year
Ended 04/30/00 Ended 10/31/99
------------------- ----------------
Shares Amount Shares Amount
------------------- ---------------- ----------- -------------
<S> <C> <C> <C> <C>
Defensive:
Sold . . . . . 64,543 $ 674,170 149,871 $ 1,614,006
Reinvested . . 18,605 190,701 21,934 233,158
Repurchased. . (85,768) (902,961) (245,016) (2,631,100)
------------------- ---------------- ----------- -------------
Net change . . (2,620) ($38,090) (73,211) ($783,936)
=================== ================ =========== =============
Blended Asset I:
Sold . . . . . 201,460 $ 2,226,822 724,072 $ 8,171,386
Reinvested . . 110,856 1,197,247 255,829 2,797,421
Repurchased. . (616,450) (6,837,089) (1,370,353) (15,530,954)
------------------- ---------------- ----------- ------------
Net change . . (304,134) ($3,413,020) (690,452) ($4,562,147)
=================== ================ =========== =============
Blended Asset II:
Sold . . . . . 517,112 $ 6,577,730 1,929,179 $ 24,742,814
Reinvested . . 362,889 4,441,763 479,972 5,789,528
Repurchased. . (1,147,256) (14,538,221) (2,526,247) (32,556,422)
------------------- ---------------- ----------- ------------
Net change . . (267,255) ($3,518,728) (117,096) ($2,024,080)
=================== ================ =========== =============
Maximum Horizon:
Sold . . . . . 522,743 $ 7,690,365 498,281 $ 6,719,574
Reinvested . . 166,956 2,337,381 105,342 1,255,526
Repurchased. . (417,082) (6,096,275) (648,323) (9,007,895)
------------------- ---------------- ----------- ------------
Net change . . 272,617 $ 3,931,471) (44,700) ($1,032,795)
=================== ================ =========== =============
</TABLE>
The Advisor owned 16,862 shares of Maximum Horizon Series and 21,718 shares of
Defensive Series on April 30, 2000 and 15,130 shares of Maximum Horizon Series
and 20,825 shares of Defensive Series on October 31, 1999.
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk in the
normal course of its investing activities to assist in managing exposure to
various market risks. These financial instruments include written options,
forward foreign currency exchange contracts, and futures contracts and may
involve, to a varying degree, elements of risk in excess of the amounts
recognized for financial statement purposes. No such investments were held by
the Series on April 30, 2000.
7. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments involves
special risks and considerations not typically associated with investing in
securities of domestic companies and the United States Government. These risks
include revaluation of currencies and future adverse political and economic
developments. Moreover, securities of foreign companies and foreign governments
may be less liquid and their prices more volatile than those of securities of
comparable domestic companies and the United States Government.
48
<PAGE>
<PAGE>
Exeter Fund, Inc.
Final Report
February 24, 2000
Flexible Yield Series I
<PAGE>
Performance Update - As of February 24, 2000
Exeter Fund, Inc. - Flexible Yield Series I
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,124 1.24% 1.24%
Five Year $12,804 28.04% 5.07%
Inception 1 $12,983 29.83% 4.42%
</TABLE>
Merrill Lynch U.S. Treasury Short-Term Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,368 3.68% 3.68%
Five Year $13,443 34.43% 6.09%
Inception 1 $13,824 38.24% 5.52%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Flexible Yield
Series I from its inception (2/15/94) to date of liquidation (2/24/00) as
compared to the Merrill Lynch U.S. Treasury Short-Term Index.2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Merrill Lynch U.S.
Date Flexible Yield Series I Treasury Short-term Index
<S> <C> <C>
02/15/1994 10,000 10,000
12/31/1994 9,924 10,030
12/31/1995 10,995 11,133
10/31/1996 11,441 11,598
10/31/1997 12,025 12,350
10/31/1998 12,935 13,302
10/31/1999 13,014 13,700
02/24/2000 12,983 13,824
</TABLE>
1 The Series and Index performance are calculated from February 15, 1994, the
Series' inception date. The Series' performance is historical and may not be
indicative of future results.
2 The Merrill Lynch U.S. Treasury Short-Term Index is a market value weighted
measure of approximately 50 U.S. Treasury Securities. The Index is comprised of
U.S. Treasury securities with maturities greater than one year but less than
three years. The Index returns assume reinvestment of coupons and, unlike
Series returns, do not reflect any fees or
1
<PAGE>
Investment Portfolio - February 24, 2000
Note: Shares of the Series were completely redeemed on February 24, 2000,
therefore, there were no investments held in the portfolio.
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
FEBRUARY 24, 2000 (DATE OF LIQUIDATION)
ASSETS:
<S> <C>
Cash. . . . . . . . . . . . . . . . . . $15,681
-------
TOTAL ASSETS. . . . . . . . . . . . . . 15,681
-------
LIABILITIES (NOTE 7):
Accrued directors' fees (Note 3). . . . 3,333
Transfer agent fees payable (Note 3). . 99
Audit fee payable . . . . . . . . . . . 8,224
Legal fees payable. . . . . . . . . . . 2,365
Registration and filing fees payable. . 826
Other payables and accrued expenses . . 834
-------
TOTAL LIABILITIES . . . . . . . . . . . 15,681
-------
NET ASSETS FOR -0- SHARES OUTSTANDING . $ 0
=======
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($-0-/-0- shares) . . . . . . . . . . . $ 0
=======
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
Statement of Operations
<TABLE>
<CAPTION>
FOR THE PERIOD NOVEMBER 1, 1999 TO FEBRUARY 24, 2000
(DATE OF LIQUIDATION)
INVESTMENT INCOME:
<S> <C>
Interest . . . . . . . . . . . . . . . . . . . . . . . . $ 19,338
---------
EXPENSES:
Management fee (Note 3). . . . . . . . . . . . . . . . . 1,437
Directors' fees (Note 3) . . . . . . . . . . . . . . . . 1,216
Transfer agent fees (Note 3) . . . . . . . . . . . . . . 99
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . 1,797
---------
Total Expenses . . . . . . . . . . . . . . . . . . . . . 4,549
Less Reduction of Expenses (Note 3). . . . . . . . . . . (1,680)
---------
Net Expenses . . . . . . . . . . . . . . . . . . . . . . 2,869
---------
NET INVESTMENT INCOME. . . . . . . . . . . . . . . . . . 16,469
---------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized loss on investments (identified cost basis) (47,172)
Net change in unrealized depreciation on investments . . 27,207
---------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS. . . . . . . . . . . . . . . . . . . . (19,965)
---------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $ (3,496)
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
FOR THE FOR THE
PERIOD 11/1/99 YEAR ENDED
TO 2/24/00* 10/31/99
-------------- -----------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . . . . $ 16,469 $ 58,316
Net realized gain (loss) on investments. . . . . . (47,172) (8,740)
Net change in unrealized appreciation
(depreciation) on investments . . . . . . . . . 27,207 (41,220)
---------------- ----------
Net increase (decrease) from operations. . . . . . (3,496) 8,356
---------------- ----------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . . . (28,385) (54,613)
From net realized gain on investments. . . . . . . -- (3,806)
---------------- ----------
Total distributions to shareholders. . . . . . . . (28,385) (58,419)
---------------- ----------
CAPITAL STOCK ISSUED AND
REPURCHASED:
Net increase (decrease) from
capital share transactions (Note 5) . . . . . (1,361,663) 299,738
---------------- ----------
Net increase (decrease) in net assets. . . . . . . (1,393,544) 249,675
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . . . 1,393,544 1,143,869
---------------- ----------
END OF PERIOD (including undistributed net
investment income of $0 and $11,784, respectively) $ -- $1,393,544
================ ===========
</TABLE>
*Date of Liquidation
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
FOR THE FOR THE FOR THE FOR THE FOR THE TEN
PERIOD YEAR YEAR YEAR MONTHS
11/1/99 TO ENDED ENDED ENDED ENDED
2/24/00 + 10/31/99 10/31/98 10/31/97 10/31/96
----------- ---------- ---------- ------------- ----------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD . . . . . . . $ 10.19 $ 10.58 $ 10.39 $ 10.27 $ 10.26
----------- ---------- ---------- ------------- ----------
Income from investment operations:
Net investment income*. . . . . . . . . . . . . . 0.140 0.427 0.468 0.505 0.411
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . (0.164) (0.367) 0.289 0.099 (0.101)
----------- ---------- ---------- ------------- ----------
Total from investment operations . . . . . . . . . . (0.024) 0.060 0.757 0.604 0.310
----------- ---------- ---------- ------------- ----------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . (0.226) (0.417) (0.567) (0.456) (0.300)
From net realized gain on investments . . . . . . -- (0.033) -- (0.028) --
Redemption of capital (Note 7). . . . . . . . . . (9.940) -- -- -- --
----------- ---------- ---------- ------------- ----------
Total distributions to shareholders. . . . . . . . . (10.166) (0.450) (0.567) (0.484) (0.300)
----------- ---------- ---------- ------------- ----------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ -- $ 10.19 $ 10.58 $ 10.39 $ 10.27
=========== ========== ========== ============= ==========
Total return 1 . . . . . . . . . . . . . . . . . . . (0.24)%3 0.61% 7.57% 6.07% 3.11%
Ratios (to average net assets) / Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . 0.70%2,3 0.70% 0.70% 0.70% 0.70%2
Net investment income* . . . . . . . . . . . . . 4.01%2,3 4.19% 5.04% 5.29% 5.25%2
Portfolio turnover . . . . . . . . . . . . . . . . . 3% 56% 53% 77% 36%
NET ASSETS - END OF PERIOD
(000's omitted) . . . . . . . . . . . . . . . . . . $ -- $ 1,394 $ 1,144 $ 650 $ 493
=========== ========== ========== ============= ==========
FOR THE
PERIOD
FOR THE 2/15/94
YEAR (COMMENCEMENT
ENDED OF OPERATIONS)
12/31/95 TO 12/31/94
--------------- -------------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD . . . . . . . $ 9.69 $ 10.00
--------------- -------------
Income from investment operations:
Net investment income*. . . . . . . . . . . . . . 0.464 0.241
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . 0.566 (0.317)
--------------- -------------
Total from investment operations . . . . . . . . . . 1.030 (0.076)
--------------- -------------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . . (0.460) (0.234)
From net realized gain on investments . . . . . . -- --
Redemption of capital (Note 7). . . . . . . . . . -- --
--------------- -------------
Total distributions to shareholders. . . . . . . . . (0.460) (0.234)
--------------- -------------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . . $ 10.26 $ 9.69
=============== =============
Total return 1 . . . . . . . . . . . . . . . . . . . 10.79% (0.76)%
Ratios (to average net assets) / Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . 0.70% 0.70%2
Net investment income* . . . . . . . . . . . . . 4.99% 4.41%2
Portfolio turnover . . . . . . . . . . . . . . . . . 60% 38%
NET ASSETS - END OF PERIOD
(000's omitted) . . . . . . . . . . . . . . . . . . $ 256 $ 231
=============== =============
</TABLE>
* The investment advisor did not impose its management fee and paid a portion
of the Series' expenses. If these expenses had been incurred by the
Series, and had 1994, 1995, and 1996 expenses been limited to that allowed
by state securities law, the net investment income per share and the ratios
would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income . . . . . $ 0.126 $0.258 $0.116 $0.206 $ 0.270 $0.297 $ 0.143
Ratios (to average net assets):
Expenses. . . . . . . . . . 1.11%2,3 2.36% 4.49% 3.83% 2.50%2 2.50% 2.50%2
Net investment income . . . 3.60%2,3 2.53% 1.25% 2.16% 3.45%2 3.19% 2.61%2
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
3 The Series ceased investment operations on February 24, 2000; therefore ratios
and total return may not be representative of an actively operating fund.
+ Date of Liquidation.
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Notes to Financial Statements
1. ORGANIZATION
Flexible Yield Series I (the "Series") is a no-load diversified series of Exeter
Fund, Inc. (the "Fund"). The Fund is organized in Maryland and is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company.
The Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Currently, only Class A shares have been issued. Each class of shares is
substantially the same, except that class-specific distribution and shareholder
servicing expenses are borne by the specific class of shares to which they
relate.
The total authorized capital stock of the Fund consists of 1.7 billion
shares of common stock each having a par value of $0.01. As of February 24,
2000, 1,550 million shares have been designated in total among 31 series, of
which 37.5 million have been designated as Flexible Yield Series I Class A
Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities listed on an exchange are valued at the latest quoted
sales price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities,
will normally be valued on the basis of evaluated bid prices provided by the
Fund's pricing service.
Securities for which representative valuations or prices are not available
from the Fund's pricing service are valued at fair value as determined in good
faith by the Advisor under procedures established by and under the general
supervision and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at
amortized cost, which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are
purchased or sold. Dividend income is recorded on the ex-dividend date.
Interest income and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the series in the
Fund.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue
Code applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
The Series uses the identified cost method for determining realized gain or
loss on investments for both financial statement and federal income tax
reporting purposes.
7
<PAGE>
Notes to Financial Statements
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
DISTRIBUTIONS OF INCOME AND GAINS
Distributions to shareholders of net investment income are made quarterly.
Distributions are recorded on the ex-dividend date. Distributions of net
realized gains are distributed annually. An additional distribution may be
necessary to avoid taxation of the Series.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, character reclassification between net income and
net gains, or other required tax adjustments. As a result, net investment
income (loss) and net investment gain (loss) on investment transactions for a
reporting period may differ significantly from distributions to shareholders
during such period. As a result, the Series may periodically make
reclassifications among its capital accounts without impacting the Series' net
asset value.
OTHER
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement with Manning & Napier
Advisors, Inc., DBA Exeter Asset Management (the "Advisor"), for which the
Series pays the Advisor a fee, computed daily and payable monthly, at an annual
rate of 0.35% of the Series' average daily net assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel
of the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and portfolio accounting and bookkeeping services. The salaries of
all officers of the Fund and of all Directors who are "affiliated persons" of
the Fund or of the Advisor, and all personnel of the Fund or of the Advisor
performing services relating to research, statistical and investment activities
are paid by the Advisor.
The Advisor has voluntarily agreed to waive its fee and, if necessary, pay
other expenses of the Series in order to maintain total expenses for the Series
at no more than 0.70% of average daily net assets each year. Accordingly, the
Advisor did not impose any of its fee and paid expenses amounting to $243 for
the period ended February 24, 2000, which is reflected as a reduction of
expenses on the Statement of Operations. The fee waiver and assumption of
expenses by the Advisor is voluntary and may be terminated at any time.
The Advisor also acts as the transfer, dividend paying and shareholder
servicing agent for the Fund. For these services, the Series pays a fee which
is calculated as a percentage of the average daily net assets at an annual rate
of 0.024%.
Manning & Napier Investor Services, Inc., a registered broker-dealer
affiliate of the Advisor, acts as distributor for the Fund's shares. The
services of Manning & Napier Investor Services, Inc. are provided at no
additional cost to the Series.
8
<PAGE>
Notes to Financial Statements
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of United States Government securities, other than
short-term securities, were $25,090 and $1,262,021 respectively, for the period
ended February 24, 2000.
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of Flexible Yield Series I Class A Common Stock
were:
<TABLE>
<CAPTION>
For the Period For the Year
Ended 2/24/00 Ended 10/31/99
--------------- ----------------
Shares Amount Shares Amount
--------------- ---------------- -------- -----------
<S> <C> <C> <C> <C>
Sold. . . . -- $ -- 102,284 $1,064,926
Reinvested. 2,837 28,385 5,700 58,419
Repurchased (139,541) (1,390,048) (79,406) (823,607)
--------------- ---------------- -------- -----------
Net change. (136,704) $ (1,361,663) 28,578 $ 299,738
=============== ================ ======== ===========
</TABLE>
The Advisor owned 13,549 shares on October 31, 1999 .
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk
in the normal course of its investing activities to assist in managing exposure
to various market risks. These financial instruments include written options
and futures contracts and may involve, to a varying degree, elements of risk in
excess of the amounts recognized for financial statement purposes. No such
investments were held by the Series on February 24, 2000.
7. FUND LIQUIDATION
Effective February 2, 2000, the Board of Directors approved the liquidation of
the Series. On February 24, 2000, the Series repurchased all shares held based
upon the Series' net asset value on that date. Cash was left in the Series to
satisfy liabilities outstanding as of the date of complete liquidation. The
ratios presented in the financial highlights table may not be representative of
an actively traded fund.
9
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of Exeter Fund, Inc. - Flexible Yield Series I:
In our opinion, the accompanying statement of assets and liabilities, including
the related statements of operations and of changes in net assets and the
financial highlights present fairly, in all material respects, the financial
position of the Exeter Fund, Inc.: Flexible Yield Series I (the "Series") at
February 24, 2000, and the results of its operations, the changes in its net
assets and the financial highlights for the period November 1, 1999 to February
24, 2000 (date of liquidation) and for the year ended October 31, 1999, in
conformity with accounting principles generally accepted in the Untied States.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Series' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States, which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above. The financial statements of the Series as of
October 31, 1998 and for the periods then ended, as indicated therein, were
audited by other independent accountants whose report dated December 4, 1998
expressed an unqualified opinion on those statements.
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 31, 2000
10
<PAGE>
<PAGE>
Exeter Fund, Inc.
Final Report
February 24, 2000
Flexible Yield Series II
<PAGE>
Performance Update as of February 24, 2000
Exeter Fund, Inc. Flexible Yield Series II
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $ 9,915 -0.85% -0.85%
Five Year $13,281 32.81% 5.84%
Inception 1 $13,095 30.95% 4.57%
</TABLE>
Merrill Lynch Corporate/Government Intermediate Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,181 1.81% 1.81%
Five Year $13,741 37.41% 6.56%
Inception 1 $13,902 39.02% 5.62%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Flexible Yield
Series II from its inception (2/15/94) to date of liquidation (2/24/00) as
compared to the Merrill Lynch Corporate/Government Intermediate Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Merrill Lynch Government/
Date Flexible Yield Series II Corporate Intermediate Index
<S> <C> <C>
02/15/1994 10,000 10,000
12/31/1994 9,531 9,799
12/31/1995 11,182 11,301
10/31/1996 11,336 11,672
10/31/1997 12,199 12,560
10/31/1998 13,392 13,715
10/31/1999 13,262 13,839
02/24/2000 13,095 13,902
</TABLE>
1 The Fund and Index performance are calculated from February 15, 1994, the
Fund's inception date. The Fund's performance is historical and may not be
indicative of future results.
2 The Merrill Lynch Corporate/Government Intermediate Index is a market
value weighted measure of approximately 3,180 corporate and government bonds.
The Index is comprised of investment grade bonds with maturities greater than
one year but less than ten years. The Index returns assume reinvestment of
coupons and, unlike Fund returns, do not reflect any fees or expenses.
1
<PAGE>
Investment Portfolio - February 24, 2000
Note: Shares of the Series were completely redeemed on February 24, 2000,
therefore, there were no investments held in the portfolio.
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
FEBRUARY 24, 2000 (DATE OF LIQUIDATION)
ASSETS:
<S> <C>
Cash. . . . . . . . . . . . . . . . . . $15,198
-------
TOTAL ASSETS. . . . . . . . . . . . . . 15,198
-------
LIABILITIES (NOTE 7):
Accrued directors' fees (Note 3). . . . 3,336
Transfer agent fees payable (Note 3). . 39
Audit fee payable . . . . . . . . . . . 8,314
Legal fee payable . . . . . . . . . . . 2,365
Custodian fee payable . . . . . . . . . 246
Other payables and accrued expenses . . 898
-------
TOTAL LIABILITIES . . . . . . . . . . . 15,198
-------
NET ASSETS FOR -0- SHARES OUTSTANDING . $ 0
=======
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($-0-/-0- SHARES). . . . . . . . . . . $ 0
=======
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE PERIOD NOVEMBER 1, 1999 TO FEBRUARY 24, 2000
(DATE OF LIQUIDATION)
INVESTMENT INCOME:
<S> <C>
Interest . . . . . . . . . . . . . . . . . . . . . . . . $ 9,315
---------
EXPENSES:
Management fees (Note 3) . . . . . . . . . . . . . . . . 730
Directors' fees (Note 3) . . . . . . . . . . . . . . . . 1,219
Transfer agent fees (Note 3) . . . . . . . . . . . . . . 39
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . 619
---------
Total Expenses . . . . . . . . . . . . . . . . . . . . . 2,607
Less Reduction of Expenses (Note 3). . . . . . . . . . . (1,313)
---------
Net Expenses . . . . . . . . . . . . . . . . . . . . . . 1,294
---------
NET INVESTMENT INCOME. . . . . . . . . . . . . . . . . . 8,021
---------
REALIZED AND UNREALIZED LOSS
ON INVESTMENTS:
Net realized loss on investments (identified cost basis) (12,439)
Net change in unrealized appreciation on investments . . (1,579)
---------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS. . . . . . . . . . . . . . . . . . . . (14,018)
---------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $ (5,997)
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE FOR THE
PERIOD 11/1/99 YEAR ENDED
TO 2/24/00* 10/31/99
--------------- --------------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income. . . . . . . . . . . . .$ 8,021 $ 32,001
Net realized gain (loss) on investments. . . . (12,439) 5,625
Net change in unrealized appreciation
(depreciation) on investments. . . . . . . . . (1,579) (44,376)
---------------- ------------
Net increase (decrease) from operations. . . . (5,997) (6,750)
---------------- ------------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income . . . . . . . . . . (15,817) (32,631)
In excess of net investment income . . . . . . (1,610) --
From net realized gain on investments. . . . . (4,698) (5,048)
---------------- ------------
Total distributions to shareholders. . . . . . (22,125) (37,679)
---------------- ------------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net decrease from capital
share transactions (Note 5) . . . . . . . . (529,319) (97,459)
---------------- ------------
Net decrease in net assets . . . . . . . . . . (557,441) (141,888)
NET ASSETS:
Beginning of period. . . . . . . . . . . . . . 557,441 699,329
---------------- ------------
END OF PERIOD (including undistributed net
investment income of $0 and $7,796,
respectively). . . . . . . . . . . . . . . . . $ 0 $ 557,441
================ ============
</TABLE>
*Date of Liquidation
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
FOR THE FOR THE FOR THE FOR THE TEN FOR THE
PERIOD YEAR YEAR YEAR MONTHS YEAR
11/1/99 TO ENDED ENDED ENDED ENDED ENDED
2/24/00+ 10/31/99 10/31/98 10/31/97 10/31/96 12/31/95
---------- ---------------- ---------- ---------- ---------- -------------------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE -BEGINNING OF PERIOD. . . $ 9.80 $ 10.50 $ 10.23 $ 10.10 $ 10.30 $ 9.27
---------- ---------------- ---------- ---------- ---------- -------------------
Income from investment operations:
Net investment income*. . . . . . . . . 0.264 0.541 0.575 0.523 0.445 0.561
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . (0.385) (0.642) 0.378 0.212 (0.315) 1.019
---------- ---------------- ---------- ---------- ---------- -------------------
Total from investment operations . . . . . (0.121) (0.101) 0.953 0.735 0.130 1.580
---------- ---------------- ---------- ---------- ---------- -------------------
Less distributions to shareholders:
From net investment income. . . . . . . (0.364) (0.522) (0.589) (0.597) (0.270) (0.550)
In excess of net investment income . . . (0.037) -- -- -- -- --
From net realized gain on investments . (0.088) (0.077) (0.094) (0.008) (0.060) --
Redemption of capital. . . . . . . . . . (9.190) -- -- -- -- --
---------- ---------------- ---------- ---------- ---------- -------------------
Total distributions to shareholders. . . . (9.679) (0.599) (0.683) (0.605) (0.330) (0.550)
---------- ---------------- ---------- ---------- ---------- -------------------
NET ASSET VALUE - END OF PERIOD. . . . . . $ 0 $ 9.80 $ 10.50 $ 10.23 $ 10.10 $ 10.30
========== ================ ========== ========== ========== ===================
Total return 1 . . . . . . . . . . . . . . (1.26)%3 (0.97%) 9.78% 7.61% 1.38% 17.33%
Ratios (to average net assets) /
Supplemental Data:
Expenses*. . . . . . . . . . . . . . . 0.80%2,3 0.80% 0.80% 0.80% 0.80%2 0.80%
Net investment income* . . . . . . . . 4.93%2,3 5.13% 5.21% 5.46% 5.55%2 5.38%
Portfolio turnover . . . . . . . . . . . . 6% 36% 31% 58% 5% 35%
NET ASSETS - END OF PERIOD
(000's omitted) . . . . . . . . . . . . $ -- $ 557 $ 699 $ 718 $ 481 $ 438
========== ================ ========== ========== ========== ===================
FOR THE
PERIOD
2/15/94
(COMMENCEMENT
OF OPERATIONS)
TO 12/31/94
----------
Per share data (for a share outstanding
throughout each period):
<S> <C>
NET ASSET VALUE -BEGINNING OF PERIOD. . . $ 10.00
----------
Income from investment operations:
Net investment income*. . . . . . . . . 0.269
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . (0.738)
----------
Total from investment operations . . . . . (0.469)
----------
Less distributions to shareholders:
From net investment income. . . . . . . (0.261)
From net realized gain on investments . --
Redemption of capital. . . . . . . . . . --
----------
Total distributions to shareholders. . . . (0.261)
----------
NET ASSET VALUE - END OF PERIOD. . . . . . $ 9.27
==========
Total return 1 . . . . . . . . . . . . . . (4.69%)
Ratios (to average net assets) /
Supplemental Data:
Expenses*. . . . . . . . . . . . . . . 0.80%2
Net investment income* . . . . . . . . 5.40%2
Portfolio turnover . . . . . . . . . . . . 0%
NET ASSETS - END OF PERIOD
(000's omitted) . . . . . . . . . . . . $ 396
==========
</TABLE>
The investment advisor did not impose its management fee and paid a portion of
the Series' expenses.
If these expenses had been incurred by the Series, and had 1994, 1995, and
1996, expenses been limited to that allowed by state securities law, the net
investment income per share and the ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income . . . . . $ 0.221 $0.121 $0.145 $0.243 $ 0.309 $0.384 $ 0.184
Ratios (to average net assets):
Expenses . . . . . . . . . . 1.60%2,3 4.76% 4.70% 3.72% 2.50%2 2.50% 2.50%2
Net investment income. . . . 4.13%2,3 1.17% 1.31% 2.54% 3.85%2 3.68% 3.70%2
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
3 The Series ceased investment operations on February 24, 2000; therefore ratios
and total return may not be representative of an actively operating fund.
+ Date of Liquidation.
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Notes to Financial Statements
1. ORGANIZATION
Flexible Yield Series II (the "Series") is a no-load diversified series of
Exeter Fund, Inc. (the "Fund"). The Fund is organized in Maryland and is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company.
The Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Currently, only Class A shares have been issued. Each class of shares is
substantially the same, except that class-specific distribution and shareholder
servicing expenses are borne by the specific class of shares to which they
relate.
The total authorized capital stock of the Fund consists of 1.7 billion shares of
common stock each having a par value of $0.01. As of February 24, 2000, 1,550
million shares have been designated in total among 31 series, of which 37.5
million have been designated as Flexible Yield Series II Class A Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities listed on an exchange are valued at the latest quoted sales
price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities, will
normally be valued on the basis of evaluated bid prices provided by the Fund's
pricing service.
Securities for which representative valuations or prices are not available from
the Fund's pricing service are valued at fair value as determined in good faith
by the Advisor under procedures established by and under the general supervision
and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at amortized
cost, which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are purchased
or sold. Dividend income is recorded on the ex-dividend date. Interest income
and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the series in the
Fund.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments, in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
The Series uses the identified cost method for determining realized gain or loss
on investments for both financial statement and federal income tax reporting
purposes.
7
<PAGE>
Notes to Financial Statements
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
DISTRIBUTION OF INCOME AND GAINS
Distributions to shareholders of net investment income are made quarterly.
Distributions are recorded on the ex-dividend date. Distributions of net
realized gains are distributed annually. An additional distribution may be
necessary to avoid taxation of the Series.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, or character reclassification between net income
and net gains, or other required tax adjustments. As a result, net investment
income (loss) and net investment gain (loss) on investment transactions for a
reporting period may differ significantly from distributions to shareholders
during such period. As a result, the Series may periodically make
reclassifications among its capital accounts without impacting the Series' net
asset value.
OTHER
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement with Manning & Napier Advisors,
Inc., DBA Exeter Asset Management (the "Advisor"), for which the Series pays the
Advisor a fee, computed daily and payable monthly, at an annual rate of 0.45% of
the Series' average daily net assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel of
the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and portfolio accounting and bookkeeping services. The salaries of
all officers of the Fund and of all Directors who are "affiliated persons" of
the Fund or of the Advisor, and all personnel of the Fund or of the Advisor
performing services relating to research, statistical and investment activities
are paid by the Advisor.
The Advisor has voluntarily agreed to waive its fee and, if necessary, pay other
expenses of the Series in order to maintain total expenses for the Series at no
more than 0.80% of average daily net assets each year. Accordingly, the Advisor
did not impose any of its fee and paid expenses amounting to $583 for the period
ended February 24, 2000, which is reflected as a reduction of expenses on the
Statement of Operations. The fee waiver and assumption of expenses by the
Advisor is voluntary and may be terminated at any time.
The Advisor also acts as the transfer, dividend paying and shareholder servicing
agent for the Fund. For these services, the Series pays a fee which is
calculated as a percentage of the average daily net assets at an annual rate of
0.024%.
Manning & Napier Investor Services, Inc., a registered broker-dealer affiliate
of the Advisor, acts as distributor for the Fund's shares. The services of
Manning & Napier Investor Services, Inc. are provided at no additional cost to
the Series.
8
<PAGE>
Notes to Financial Statements
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of United States Government securities, other than
short-term securities, were $23,953 and $556,091 respectively, for the period
ended February 24, 2000
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of Flexible Yield Series II Class A Common Stock
were:
<TABLE>
<CAPTION>
For the Period 11/1/99 For the Year
to 2/24/00 Ended 10/31/99
<S> <C> <C> <C> <C>
Shares Amount Shares Amount
----------------------- ---------------- -------- ----------
Sold. . . . 4 $ 40 5,972 $ 60,262
Reinvested. 2,358 22,125 3,760 37,679
Repurchased (59,261) (551,484) (19,442) (195,400)
----------------------- ---------------- -------- ----------
Net change. (56,899) $ (529,319) (9,710) $ (97,459)
======================= ================ ======== ==========
</TABLE>
The Advisor owned 16,682 shares on October 31, 1999.
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk in the
normal course of its investing activities to assist in managing exposure to
various market risks. These financial instruments include written options and
futures contracts and may involve, to a varying degree, elements of risk in
excess of the amounts recognized for financial statement purposes. No such
investments were held by the Series on February 24, 2000.
7. FUND LIQUIDATION
Effective February 2, 2000, the Board of Directors approved the liquidation of
the Series. On February 24, 2000, the Series repurchased all shares held based
upon the Series' net asset value on that date. Cash was left in the Series to
satisfy liabilities outstanding as of the date of complete liquidation. The
ratios presented in the financial highlights table may not be representative of
an actively traded fund.
9
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of Exeter Fund, Inc. - Flexible Yield Series II:
In our opinion, the accompanying statement of assets and liabilities, including
the related statements of operations and of changes in net assets and the
financial highlights present fairly, in all material respects, the financial
position of the Exeter Fund, Inc.: Flexible Yield Series II (the "Series") at
February 24, 2000, and the results of its operations, the changes in its net
assets and the financial highlights for the period November 1, 1999 to February
24, 2000 (date of liquidation) and for the year ended October 31, 1999, in
conformity with accounting principles generally accepted in the United States.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Series' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States, which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above. The financial statements of the Series as of
October 31, 1998 and for the periods then ended, as indicated therein, were
audited by other independent accountants whose report dated December 4, 1998
expressed an unqualified opinion on those statements.
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 31, 2000
10
<PAGE>
<PAGE>
Exeter Fund, Inc.
Final Report
February 24, 2000
Flexible Yield Series III
<PAGE>
Performance Update as of February 24, 2000
Exeter Fund, Inc. - Flexible Yield Series III
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $ 9,845 -1.55% -1.55%
Five Year $13,997 39.97% 6.95%
Inception 1 $13,619 36.19% 5.12%
</TABLE>
Merrill Lynch Corporate/Government Bond Index
<TABLE>
<CAPTION>
Total Return
Through Growth of $10,000 Average
02/24/00 Investment Cumulative Annual
<S> <C> <C> <C>
One Year $10,097 0.97% 0.97%
Five Year $14,142 41.42% 7.17%
Inception 1 $14,184 41.84% 5.81%
</TABLE>
The value of a $10,000 investment in the Exeter Fund, Inc. - Flexible Yield
Series III from its inception (12/20/93) to date of liquidation (2/24/00) as
compared to the Merrill Lynch Corporate/Government Bond Index. 2
[graphic]
[line chart]
Data for line chart to follow:
<TABLE>
<CAPTION>
Exeter Fund, Inc. Merrill Lynch Government/
Date Flexible Yield Series III Corporate Bond Index
<S> <C> <C>
12/20/1993 10,000 10,000
12/31/1993 9,960 10,013
12/31/1994 9,380 9,686
12/31/1995 11,451 11,532
10/31/1996 11,431 11,778
10/31/1997 12,542 12,832
10/31/1998 14,066 14,158
10/31/1999 13,756 14,053
02/24/2000 13,619 14,184
</TABLE>
1 The Fund and Index performance are calculated from December 20, 1993, the
Fund's inception date. The Fund's performance is historical and may not be
indicative of future results.
2 The Merrill Lynch Corporate/Government Bond Index is a market value weighted
measure of approximately 4,500 corporate and government bonds. The Index is
comprised of investment grade securities with maturities greater than one year.
The Index returns assume reinvestment of coupons and, unlike Fund returns, do
not reflect any fees or expenses.
1
<PAGE>
Investment Portfolio - February 24, 2000
Note: Shares of the Series were completely redeemed on February 24, 2000,
therefore, there were no investments held in the portfolio.
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
FEBRUARY 24, 2000 (DATE OF LIQUIDATION)
ASSETS:
<S> <C>
Cash . . . . . . . . . . . . . . . . . . $15,441
-------
TOTAL ASSETS . . . . . . . . . . . . . . 15,441
-------
LIABILITIES (NOTE 7):
Accrued directors' fees (Note 3) . . . . 3,333
Transfer agent fees payable (Note 3) . . 65
Audit fee payable. . . . . . . . . . . . 7,989
Legal fee payable. . . . . . . . . . . . 2,352
Custodian fee payable. . . . . . . . . . 387
Other payables and accrued expenses. . . 1,315
-------
TOTAL LIABILITIES. . . . . . . . . . . . 15,441
-------
NET ASSETS FOR -0- SHARES OUTSTANDING. . $ 0
=======
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE - CLASS A
($-0-/-0- shares) . . . . . . . . . . $ 0
=======
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE PERIOD NOVEMBER 1, 1999 TO FEBRUARY 24, 2000
(Date of Liquidation)
INVESTMENT INCOME:
<S> <C>
Interest . . . . . . . . . . . . . . . . . . . . . . . . $ 15,853
---------
EXPENSES:
Management fees (Note 3) . . . . . . . . . . . . . . . . 1,343
Directors' fees (Note 3) . . . . . . . . . . . . . . . . 1,216
Transfer agent fees (Note 3) . . . . . . . . . . . . . . 64
Miscellaneous. . . . . . . . . . . . . . . . . . . . . . 1,082
---------
Total Expenses . . . . . . . . . . . . . . . . . . . . . 3,705
Less Reduction of Expenses (Note 3). . . . . . . . . . . (1,425)
---------
Net Expenses . . . . . . . . . . . . . . . . . . . . . . 2,280
---------
NET INVESTMENT INCOME. . . . . . . . . . . . . . . . . . 13,573
---------
REALIZED AND UNREALIZED LOSS
ON INVESTMENTS:
Net realized loss on investments (identified cost basis) (5,996)
Net change in unrealized appreciation on investments . . (16,789)
---------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS. . . . . . . . . . . . . . . . . . . . (22,785)
---------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $ (9,212)
=========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE FOR THE
PERIOD 11/1/99 YEAR ENDED
TO 2/24/00* 10/31/99
------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
<S> <C> <C>
Net investment income . . . . . . . . . . . . . . . . $ 13,573 $ 59,564
Net realized gain (loss) on investments . . . . . . . (5,996) 34,689
Net change in unrealized appreciation on investments. (16,789) (121,104)
------------ -----------
Net decrease from operations. . . . . . . . . . . . . (9,212) (26,851)
------------ -----------
DISTRIBUTIONS TO SHAREHOLDERS (NOTE 2):
From net investment income. . . . . . . . . . . . . . (26,025) (65,659)
In excess of net investment income. . . . . . . . . . (3,715) --
From net realized gain on investments . . . . . . . . (32,560) (40,247)
------------ -----------
Total distributions to shareholders . . . . . . . . . (62,300) (105,906)
------------ -----------
CAPITAL STOCK ISSUED AND REPURCHASED:
Net decrease from capital share
transactions (Note 5). . . . . . . . . . . . . . . (958,418) (585,984)
------------ -----------
Net decrease in net assets. . . . . . . . . . . . . . (1,029,930) (718,741)
NET ASSETS:
Beginning of year . . . . . . . . . . . . . . . . . . 1,029,930 1,748,671
------------ -----------
END OF YEAR (including undistributed net investment
income of $0 and $12,552, respectively). . . . . . $ 0 $1,029,930
============ ===========
</TABLE>
* Date of liquidation.
The accompanying notes are an integral part of the financial statements
5
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
PERIOD YEAR YEAR YEAR TEN MONTHS YEAR
11/1/99 TO ENDED ENDED ENDED ENDED ENDED
2/24/00+ 10/31/99 10/31/98 10/31/97 10/31/96 12/31/95
---------- ---------- ---------- ---------- ------------ ----------
Per share data (for a share outstanding
throughout each period):
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . . . . . $ 10.05 $ 11.06 $ 10.41 $ 10.13 $ 10.51 $ 9.11
---------- ---------- ---------- ---------- ------------ ----------
Income from investment operations:
Net investment income*. . . . . . . . . . . . . 0.305 0.567 0.531 0.580 0.497 0.582
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . (0.404) (0.802) 0.692 0.355 (0.532) 1.393
---------- ---------- ---------- ---------- ------------ ----------
Total from investment operations . . . . . . . . . (0.099) (0.235) 1.223 0.935 (0.035) 1.975
---------- ---------- ---------- ---------- ------------ ----------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . (0.359) (0.526) (0.567) (0.610) (0.345) (0.575)
In excess of net investment income. . . . . . . (0.051) -- -- -- -- --
From net realized gain on investments . . . . . (0.371) (0.249) (0.006) (0.045) -- --
Redemption of capital . . . . . . . . . . . . . (9.170) -- -- -- -- --
---------- ---------- ---------- ---------- ------------ ----------
Total distributions to shareholders. . . . . . . . (9.951) (0.775) (0.573) (0.655) (0.345) (0.575)
---------- ---------- ---------- ---------- ------------ ----------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . $ 0 $ 10.05 $ 11.06 $ 10.41 $ 10.13 $ 10.51
========== ========== ========== ========== ============ ==========
Total return 1 . . . . . . . . . . . . . . . . . . (0.99)%3 (2.21%) 12.15% 9.73% (0.18%) 22.09%
Ratios (to average net assets)/Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . . 0.85%2,3 0.85% 0.85% 0.85% 0.85%2 0.85%
Net investment income* . . . . . . . . . . . . . . 5.05%2,3 5.01% 5.25% 5.82% 5.98%2 6.13%
Portfolio turnover . . . . . . . . . . . . . . . . 6% 29% 20% 51% 5% 6%
NET ASSETS - END OF PERIOD (000's omitted) . . . . $ -- $ 1,030 $ 1,749 $ 1,345 $ 1,098 $ 1,159
========== ========== ========== ========== ============ ==========
FOR THE
YEAR
Ended
12/31/94
----------
Per share data (for a share outstanding
throughout each period):
<S> <C>
NET ASSET VALUE - BEGINNING OF PERIOD. . . . . . . $ 9.95
----------
Income from investment operations:
Net investment income*. . . . . . . . . . . . . 0.262
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . (0.841)
----------
Total from investment operations . . . . . . . . . (0.579)
----------
Less distributions to shareholders:
From net investment income. . . . . . . . . . . (0.261)
In excess of net investment income. . . . . . . --
From net realized gain on investments . . . . . --
Redemption of capital . . . . . . . . . . . . . --
----------
Total distributions to shareholders. . . . . . . . (0.261)
----------
NET ASSET VALUE - END OF PERIOD. . . . . . . . . . $ 9.11
==========
Total return 1 . . . . . . . . . . . . . . . . . . (5.83%)
Ratios (to average net assets)/Supplemental Data:
Expenses*. . . . . . . . . . . . . . . . . . . . . 0.85%
Net investment income* . . . . . . . . . . . . . . 6.22%
Portfolio turnover . . . . . . . . . . . . . . . . 1%
NET ASSETS - END OF PERIOD (000's omitted) . . . . $ 748
==========
</TABLE>
* The investment advisor did not impose its management fee and paid a portion of
the Series' expenses. If these expenses had been incurred by the Series, and had
1994 and 1996 expenses been limited to that allowed by state securities law, the
net investment income per share and the ratios would have been as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income. . . . . $ 0.273 $0.312 $0.379 $0.437 $ 0.360 $0.429 $0.192
Ratios(to average net assets):
Expenses . . . . . . . . . 1.38%2,3 2.87% 2.35% 2.28% 2.50%2 2.46% 2.50%
Net investment income. . . 4.52%2,3 2.99% 3.75% 4.39% 4.33%2 4.52% 4.57%
</TABLE>
1 Represents aggregate total return for the period indicated.
2 Annualized.
3 The Series ceased investment operations on February 24, 2000; therefore ratios
and total return may not be representative of an actively operating fund.
+Date of liquidation.
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
Notes to Financial Statements
1. ORGANIZATION
Flexible Yield Series III (the "Series") is a no-load diversified series of
Exeter Fund, Inc. (the "Fund"). The Fund is organized in Maryland and is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company.
The Series is authorized to issue five classes of shares (Class A, B, C, D, and
E). Currently, only Class A shares have been issued. Each class of shares is
substantially the same, except that class-specific distribution and shareholder
servicing expenses are borne by the specific class of shares to which they
relate.
The total authorized capital stock of the Fund consists of 1.7 billion shares of
common stock each having a par value of $0.01. As of February 24, 2000, 1,550
million shares have been designated in total among 31 series, of which 37.5
million have been designated as Flexible Yield Series III Class A Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Portfolio securities listed on an exchange are valued at the latest quoted sales
price of the exchange on which the security is traded most extensively.
Securities not traded on valuation date or securities not listed on an exchange
are valued at the latest quoted bid price.
Debt securities, including government bonds and mortgage backed securities, will
normally be valued on the basis of evaluated bid prices provided by the Fund's
pricing service.
Securities for which representative valuations or prices are not available from
the Fund's pricing service are valued at fair value as determined in good faith
by the Advisor under procedures established by and under the general supervision
and responsibility of the Fund's Board of Directors.
Short-term investments that mature in sixty days or less are valued at amortized
cost, which approximates market value.
SECURITY TRANSACTIONS, INVESTMENT INCOME AND EXPENSES
Security transactions are accounted for on the date the securities are purchased
or sold. Dividend income is recorded on the ex-dividend date. Interest income
and expenses are recorded on an accrual basis.
Most expenses of the Fund can be attributed to a specific series. Expenses
which cannot be directly attributed are apportioned among the series in the
Fund.
FEDERAL INCOME TAXES
The Series' policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies. The Series is not subject to
federal income or excise tax to the extent the Series distributes to
shareholders each year its taxable income, including any net realized gains on
investments in accordance with requirements of the Internal Revenue Code.
Accordingly, no provision for federal income tax or excise tax has been made in
the financial statements.
The Series uses the identified cost method for determining realized gain or loss
on investments for both financial statement and federal income tax reporting
purposes.
7
<PAGE>
Notes to Financial Statements
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
DISTRIBUTIONS OF INCOME AND GAINS
Distributions to shareholders of net investment income are made quarterly.
Distributions are recorded on the ex-dividend date. Distributions of net
realized gains are distributed annually. An additional distribution may be
necessary to avoid taxation of the Series.
The timing and characterization of certain income and capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. The differences may be a result
of deferral of certain losses, character reclassification between net income and
net gains, or other tax adjustments. As a result, net investment income (loss)
and net investment gain (loss) on investment transactions for a reporting period
may differ significantly from distributions to shareholders during such period.
As a result, the Series may periodically make reclassifications among its
capital accounts without impacting the Series' net asset value.
OTHER
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
3. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory agreement with Manning & Napier Advisors,
Inc., DBA Exeter Asset Management (the "Advisor"), for which the Series pays the
Advisor a fee, computed daily and payable monthly, at an annual rate of 0.50% of
the Series' average daily net assets.
Under the Fund's Investment Advisory Agreement (the "Agreement"), personnel of
the Advisor provide the Series with advice and assistance in the choice of
investments and the execution of securities transactions, and otherwise maintain
the Series' organization. The Advisor also provides the Fund with necessary
office space and portfolio accounting and bookkeeping services. The salaries of
all officers of the Fund and of all Directors who are "affiliated persons" of
the Fund or of the Advisor, and all personnel of the Fund or of the Advisor
performing services relating to research, statistical and investment activities
are paid by the Advisor.
The Advisor has voluntarily agreed to waive its fee and, if necessary, pay other
expenses of the Series in order to maintain total expenses for the Series at no
more than 0.85% of average daily net assets each year. Accordingly, the Advisor
did not impose any of its fee and paid expenses amounting to $82 for the period
ended February 24, 2000, which is reflected as a reduction of expenses on the
Statement of Operations. The fee waiver and assumption of expenses by the
Advisor is voluntary and may be terminated at any time.
The Advisor also acts as the transfer, dividend paying and shareholder servicing
agent for the Fund. For these services, the Series pays a fee which is
calculated as a percentage of the average daily net assets at an annual rate of
0.024%.
Manning & Napier Investor Services, Inc., a registered broker-dealer affiliate
of the Advisor, acts as distributor for the Fund's shares. The services of
Manning & Napier Investor Services, Inc. are provided at no additional cost to
the Series.
8
<PAGE>
Notes to Financial Statements
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of United States Government securities, other than
short-term securities, were $40,275 and $1,018,191, respectively, for the period
ended February 24, 2000.
5. CAPITAL STOCK TRANSACTIONS
Transactions in shares of Flexible Yield Series III Class A Common Stock were:
<TABLE>
<CAPTION>
FOR THE PERIOD FOR THE YEAR
11/1/99 TO 2/24/00 ENDED 10/31/99
-------------------- --------------
<S> <C> <C> <C> <C>
Shares Amount Shares Amount
-------------- --------------- --------- --------
Sold . . . . . . . . 569 $ 5,521 25,257 $ 275,582
Reinvested . . . . . 6,682 62,299 9,895 103,502
Repurchased. . . . . (109,683) (1,026,240) (90,772) (965,068)
--------------- -------------- -------- ----------
Net change . . . . . (102,432) $ (958,418) (55,620) $(585,984)
=============== ============== ======== ==========
</TABLE>
The Advisor owned 13,079 shares on October 31, 1999.
6. FINANCIAL INSTRUMENTS
The Series may trade in financial instruments with off-balance sheet risk in the
normal course of its investing activities to assist in managing exposure to
various market risks. These financial instruments include written options and
futures contracts and may involve, to a varying degree, elements of risk in
excess of the amounts recognized for financial statement purposes. No such
investments were held by the Series on February 24, 2000.
7. FUND LIQUIDATION
Effective February 2, 2000, the Board of Directors approved the liquidation of
the Series. On February 24, 2000, the Series repurchased all shares held based
upon the Series' net asset value on that date. Cash was left in the Series to
satisfy liabilities outstanding as of the date of complete liquidation. The
ratios presented in the financial highlights table may not be representative of
an actively traded fund.
9
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of Exeter Fund, Inc. - Flexible Yield Series III:
In our opinion, the accompanying statement of assets and liabilities, including
the related statements of operations and of changes in net assets and the
financial highlights present fairly, in all material respects, the financial
position of the Exeter Fund, Inc.: Flexible Yield Series III (the "Series") at
February 24, 2000, and the results of its operations, the changes in its net
assets and the financial highlights for the period November 1, 1999 to February
24, 2000 (date of liquidation) and for the year ended October 31, 1999, in
conformity with accounting principles generally accepted in the United States.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Series' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States, which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above. The financial statements of the Series as of
October 31, 1998 and for the periods then ended, as indicated therein, were
audited by other independent accountants whose report dated December 4, 1998
expressed an unqualified opinion on those statements.
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 31, 2000
10
<PAGE>
<PAGE>
June 29, 2000
To Shareholders of the following Series of the Exeter Fund:
Defensive Series
Blended Asset Series I
Blended Asset Series II
Maximum Horizon Series
Tax Managed Series
PureMarkSM Series
Dear Shareholder:
Enclosed is a copy of the Semi-Annual Report for each of the above Series of the
Exeter Fund in which you were invested as of April 30, 2000. The reports include
information about the Series' performance as well as portfolio listings as of
that date. This year, we have combined the reports for each of our
Objectives-Based Series (the Defensive Series, Blended Asset Series I, Blended
Asset Series II, and Maximum Horizon Series) into a single booklet to make it
easier to compare the Series.
Please contact our Fund Services department at 1-800-466-3863 or your Client
Consultant if you have any questions about the Semi-Annual Reports or about the
Fund.
Sincerely,
Amy J. Williams
Fund Services Manager
<PAGE>
