Semiannual Report March 31, 1998
OPPENHEIMER
Discovery
Fund
[Mezzotint of telescope]
[Oppenheimer Logo]
OppenheimerFunds(sm)
THE RIGHT WAY TO INVEST
<PAGE>
Contents
3 President's Letter
4 Fund Performance
6 An Interview
with the Fund's
Manager
10 Statement of
Investments
18 Statement of
Assets and
Liabilities
20 Statement of
Operations
21 Statements of
Changes in
Net Assets
22 Financial Highlights
25 Notes to Financial
Statements
31 Officers and
Trustees
32 Information and
Services
Report highlights
- --------------------------------------------------------------------------------
[bullet] Small company stocks, in particular, recovered as
concerns subsided. Indeed, the past few months have
been described as a "sigh of relief" rally, and the
Fund has benefited, particularly since mid-January.
[bullet] Telecommunications and
computer software were the top
performing sectors, while oil-
related stocks lagged.
[bullet] Other top performers were in
fields such as healthcare,
entertainment and technology
consulting.
Cumulative Total Returns
For the 6-Month Period
Ended 3/31/98
Class A
Without With
Sales Chg.(1) Sales Chg.(2)
5.60% (0.47)%
Class B
Without With
Sales Chg.(1) Sales Chg.(2)
5.21% 0.21%
Class C
Without With
Sales Chg.(1) Sales Chg.(2)
5.24% 4.24%
Class Y
Without With
Sales Chg.(1) Sales Chg.(2)
5.82% 5.82%
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
In reviewing performance and rankings, please remember that past performance
does not guarantee future results. Investment return and principal value of an
investment in the Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than the original cost.
1. Includes changes in net asset value per share without deducting any sales
charges. This performance is not annualized.
2. Class A returns include the current maximum initial sales charge of 5.75%.
Class B returns include the applicable contingent deferred sales charge of 5%.
Class C returns for the one-year result include the contingent deferred sales
charge of 1%. Class Y shares are not available for sale to individual
shareholders. An explanation of the different performance calculations is in the
Fund's prospectus. Class B and C shares are subject to an annual 0.75%
asset-based sales charge.
2 Oppenheimer Discovery Fund
<PAGE>
Dear shareholder,
- --------------------------------------------------------------------------------
[BRIDGET A. MACASKILL PHOTO]
Bridget A. Macaskill
President
Oppenheimer
Discovery Fund
These have been very positive times for many American investors. The U.S.
economy has continued to grow at a moderate pace, unemployment has fallen to its
lowest level in 30 years and inflation has also fallen to a record low. In fact,
long-term interest rates have fallen to their lowest level since the government
began issuing 30-year Treasury bonds in 1977.
What benefits does this provide to the average American? First, when
unemployment levels are low, many individuals tend to feel a greater sense of
job security and can command higher wages because there are fewer unemployed
workers vying for their jobs. Second, many homeowners are opting to refinance
their existing home mortgage loans and take advantage of lower financing rates.
And third, because wages are increasing faster than the rate of inflation, a
paycheck may stretch further and investors, as consumers, are able to enjoy a
higher level of disposable income. This extra income can be put to use in many
ways, including allocating more money to investment opportunities.
Some industry analysts have tempered such positive news by suggesting that
if the rate of inflation falls any lower, it might actually trigger a period of
deflation, where we see the prices of American goods and services decline. While
lower prices may sound like positive news, in reality it isn't: When prices fall
too low, it erodes the value of those goods to the producer. That is, when
economic conditions force a decrease in the price of goods, companies have to
sell more of those items in order to make the same amount of profit, which
translates into greater difficulties for corporations to improve their bottom
lines.
At OppenheimerFunds, we do not believe we will see a period of deflation in
the United States. The fundamental factors that have driven the U.S. market
still appear to be in place: an economy that's in its eighth year of expansion
with moderate growth, low unemployment, virtually no inflation and low interest
rates. However, because of economic uncertainties in other parts of the world,
particularly Asia, we expect to see slower growth for stocks in 1998 and a year
in which double-digit returns from the equity markets are unlikely. It's also
possible that we may see investors favor the fixed, more secure interest
payments offered from the bond markets.
In closing, we'd like to reassure you that as professional money managers,
we continue to keep a watchful eye on these situations and are closely
monitoring your fund's investments. In times like these, your financial advisor
can be of invaluable assistance to you in helping review your financial plan and
guide your investments accordingly.
Thank you for your confidence in OppenheimerFunds, The Right Way to Invest.
We look forward to helping you reach your investment goals in the future.
[Bridget A. Macaskill signature]
Bridget A. Macaskill
April 21, 1998
3 Oppenheimer Discovery Fund
<PAGE>
Avg Annual Total Returns
For the Periods Ended 3/31/98(1)
Class A
1 year 5 year 10 year
32.91% 14.20% 16.96%
Class B
Since
1 year 5 year Inception
34.93% N/A 15.95%
Class C
Since
1 year 5 year Inception
39.05% N/A 16.35%
Class Y
Since
1 year 5 year Inception
41.53% N/A 19.27%
Cumulative Total Return
For the Period Ended 3/31/98(1)
Class A
5 year
94.27% $19,427(3)
Performance update
- --------------------------------------------------------------------------------
Last fall, the Asian economic crisis put stock markets
under pressure, and investors tended to prefer large
blue-chip stocks. Still, the Fund, which invests in small
companies, produced a solid return. For the six-month
period ended March 31, 1998, the Fund's Class A shares
produced a cumulative total return, without sales
charges, of 5.60%.(2)
Growth of $10,000
Over five years(3)
(without sales charges)
[GRAPHIC OF MOUNTAIN CHART]
MOUNTAIN CHART PLOT POINTS
Oppenheimer Discovery Fund Russell 2000 Index
Class A Shares
3/31/93 10000 10000
10461.2 10218.3
11871.5 11111.7
12047.1 11403.3
11097.6 11100.7
10001.6 10668.3
10932.8 11408.9
10700.2 11195.5
11338.3 11711.7
12133.6 12809.5
13996.6 14074.6
14636.7 14379.6
15583.4 15113.2
17455.7 15869.3
17881.9 15923
16801.9 16751.4
14616.7 15885.2
17322.7 18460.3
19519.2 21207.8
18542.2 20497.5
3/31/98 20611.8 22559.3
1. Total returns include changes in share price and reinvestment of dividends
and capital gains distributions in a hypothetical investment for the periods
shown. Class A returns include the current maximum initial sales charge of
5.75%. Class A shares were first publicly offered on 9/11/86. The Fund's maximum
sales charge for Class A shares was lower prior to 4/1/91, so actual performance
may have been higher. Class B returns include the applicable contingent deferred
sales charge of 5% (1-year) and 3% (since inception on 4/1/94). Class C returns
for the one-year result include the contingent deferred sales charge of 1%.
Class C shares have been available since 10/2/95. Class Y shares were first
publicly offered on 6/1/94 and are not available for sale to individual
shareholders. An explanation of the different performance calculations is in the
Fund's prospectus. Class B and C shares are subject to an annual 0.75%
asset-based sales charge.
4 Oppenheimer Discovery Fund
<PAGE>
[PIE CHART]
Sector Weightings(4)
[bullet] Technology 25.0%
[bullet] Industrial 21.9
[bullet] Consumer
Non-Cyclical 19.8
[bullet] Consumer
Cyclical 18.2
[bullet] Energy 5.7
[bullet] Utilities 4.4
[bullet] Financial 3.7
[bullet] Basic Materials 1.3
Portfolio review
- --------------------------------------------------------------------------------
Oppenheimer Discovery Fund is for investors aggressively seeking high long-term
growth from small-company stocks.
What We Look For
[bullet] Earnings growth rates we believe are sustainable.
[bullet] Rapidly accelerated earnings.
[bullet] Innovative products or services.
[bullet] Self-financed expansion and/or expansion into new markets.
Top 10 Stock Holdings(4)
................................................................................
Saville Systems Ireland plc, 2.2% JDA Software Group, Inc. 1.3%
Sponsored ADR
................................................................................
Visio Corp. 1.9 CIBER, Inc. 1.3
................................................................................
Pittway Corp., Cl. A 1.8 MSC Industrial Direct Co., Inc., 1.3
Cl. A
................................................................................
Cinar Films, Inc., Cl. B 1.5 Total Renal Care Holdings, Inc. 1.2
................................................................................
CORT Business Services Corp. 1.4 Pier 1 Imports, Inc. 1.2
................................................................................
2. Includes changes in net asset value per share without deducting any sales
charges. Such performance would have been lower if sales charges were taken into
account.
3. Results of a hypothetical $10,000 investment in Class A shares on March 31,
1998. The Russell 2000 Index is a capitalization-weighted index of 2000 U.S.
issuers with market values ranging from $25 million to $1 billion, and cannot be
purchased directly by investors.
4. Portfolio is subject to change. Percentages are as of March 31, 1998, and are
based on total market value of common stock holdings.
5 Oppenheimer Discovery Fund
<PAGE>
"The past few months have been described as the 'sigh of relief' rally."
An interview with your Fund's manager
- --------------------------------------------------------------------------------
How did the Fund perform during the period?
Oppenheimer Discovery Fund, which invests in small, growing companies, generated
a return in line with its small-cap benchmark index, the Russell 2000.(1) For
the six-month period ended March 31, 1998, the Fund's Class A shares produced a
cumulative total return, without sales charges, of 5.60%, as compared with 5.77%
for the Russell 2000.(2)
Why haven't small companies kept up with the Dow Jones Industrial Average?
During the last quarter of 1997, investors became concerned about the impact of
Asia's economic crisis on the U.S. economy and on domestic corporate profits. As
a result, stock prices generally were under pressure, and a preference for
large, liquid, blue-chip stocks caused small-cap stocks to underperform.
By early 1998, the broad stock market rebounded as fourth-quarter
corporate profits came out largely unaffected by Asia's problems. Small company
stocks, in particular, recovered as concerns subsided. Indeed, the past few
months have been described as a "sigh of relief" rally, and the Fund has
benefited, particularly since mid-January.
What sectors of the Fund have performed the best during the past six months?
Although our strategy is to select stocks on a "bottom up" basis, rather than
choosing sectors from the "top down," several industries stood out. Clearly, the
best performing sector was telecommunications, including domestic and
international long-distance companies,
1. The Russell 2000 is an unmanaged index of small capitalization stocks, and
cannot be purchased directly by investors.
2. Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
6 Oppenheimer Discovery Fund
<PAGE>
[PHOTOGRAPH]
Portfolio Management
Team (l to r)
Bonnie Sherman
Alan Gilston
Jay Tracey (Portfolio Manager)
Susan Switzer
as well as local service providers. Worldwide government
deregulation has continued to create new business opportunities. In
addition, continued merger and acquisition activity in the industry
has established higher valuations for the stocks.
Computer software and services companies also contributed to the Fund's
performance. Those companies that can help solve the Year 2000 problem are doing
very well, because there is a shortage of qualified technical personnel in this
area. Also in demand are consulting firms that help their clients convert from
antiquated mainframe computers to modern systems. The portfolio is
under-emphasizing what we call "hardcore high-tech" companies, such as printed
circuit board manufacturers and semiconductor companies, because they have more
customers in Asia and are more vulnerable than software companies to lost
business there.
Healthcare is another area of innovation. One company in our portfolio has
developed an early detection device for breast cancer. Although it doesn't
absolutely confirm the diagnosis, the product provides an early warning to the
doctor by using a low-cost, non-invasive screening device. Another healthcare
company in the portfolio manages assisted living retirement communities, an
under-served but rapidly growing segment of the "aging of America" market.
Assisted living communities offer desirable housing that is not as medically
intensive as a nursing home, but where healthcare resources are nearby.
7 Oppenheimer Discovery Fund
<PAGE>
"With earnings
growth becoming
harder to find..."
An interview with your Fund's manager
- --------------------------------------------------------------------------------
What individual stocks performed particularly well?
One of the largest positions in the Fund, and one of its best performers, is
Saville Systems Ireland plc, a billing software company that sells its products
to telecommunications and cable-TV companies. It has executed its business plan
flawlessly and is growing very rapidly. As most consumers are aware, telephone
bills aren't just from a local or long-distance provider anymore. Instead, they
often include several vendors and generating a combined bill is no small task.
Another successful position in the Fund is Cinar Films, Inc., a
Canadian-based producer of children's programming with customers throughout the
U.S. and Europe. With the proliferation of cable stations and other avenues of
distribution, the worldwide demand for programming has surged. Cinar Films has
done an excellent job of building a program library and producing new shows in a
profitable manner. The company recently diversified into the educational market,
where there are synergies with their entertainment programs. Indeed, children
are delighted to go to school and recognize TV characters such as Paddington
Bear on their classroom's bulletin board.
What has been a weak area for the Fund?
Although we're still bullish long-term on the group, energy services companies
have done poorly during this period, primarily due to falling oil prices. Unlike
the 1970s, when the world was dependent upon the Middle East for oil, there are
many more sources of supply today in such places as Latin America. However,
we're more positive on the energy companies in our portfolio that have
significant natural gas interests, because natural gas prices have remained
relatively firm.
8 Oppenheimer Discovery Fund
<PAGE>
"...investors are
beginning to
gravitate back
to the high
earnings-growth-
potential
investments that
Discovery Fund
owns."
Let's look forward to the rest of 1998. What's your outlook for the Fund?
Our outlook is positive for 1998. We are encouraged that the Fund's growth
style of investing--which emphasizes companies with faster-than-average profit
growth--is generally doing better this year. Value styles, which emphasize
stocks that sell at a discount to the market, had outperformed from mid-1996
through the end of 1997. With earnings growth becoming harder to find, investors
are beginning to gravitate back to the high earnings-growth-potential
investments that Oppenheimer Discovery Fund owns.
In addition, small company stocks have been underperforming since the end
of 1993 primarily because large company earnings growth has been very good.
Investors did not need to go to small companies to get very good earnings growth
over the last three to four years. We think that's changing, and that investors
will need to look at smaller companies for growth. As a result, we believe that
the outlook for small company investing is brighter now than it has been for
several years.
9 Oppenheimer Discovery Fund
<PAGE>
Statement of Investments March 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
=========== ================
- --------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks--89.4%
- --------------------------------------------------------------------------------
Basic Materials--1.1%
- --------------------------------------------------------------------------------
Chemicals--0.9%
AMCOL International Corp. 210,000 $ 3,176,250
- --------------------------------------------------------------------------------
International Specialty Products, Inc.(1) 380,000 6,673,750
- --------------------------------------------------------------------------------
Minerals Technologies, Inc. 133,000 6,699,875
-----------
16,549,875
- --------------------------------------------------------------------------------
Paper--0.2%
Chesapeake Corp. 100,000 3,450,000
- --------------------------------------------------------------------------------
Consumer Cyclicals--16.3%
- --------------------------------------------------------------------------------
Autos & Housing--1.5%
Fairfield Communities, Inc.(1) 700,000 15,443,750
- --------------------------------------------------------------------------------
Wilmar Industries, Inc.(1) 435,000 10,820,625
-----------
26,264,375
- --------------------------------------------------------------------------------
Leisure & Entertainment--5.5%
Action Performance Cos., Inc.(1) 300,000 10,556,250
- --------------------------------------------------------------------------------
Brinker International, Inc.(1) 265,000 5,796,875
- --------------------------------------------------------------------------------
Cinar Films, Inc., Cl. B(1) 555,000 23,656,875
- --------------------------------------------------------------------------------
CKE Restaurants, Inc. 250,000 9,187,500
- --------------------------------------------------------------------------------
Coach USA, Inc.(1) 300,000 13,050,000
- --------------------------------------------------------------------------------
Cracker Barrel Old Country Store, Inc. 130,000 5,200,000
- --------------------------------------------------------------------------------
Darden Restaurants, Inc. 380,000 5,913,750
- --------------------------------------------------------------------------------
Extended Stay America, Inc.(1) 200,000 2,937,500
- --------------------------------------------------------------------------------
Landry's Seafood Restaurants, Inc.(1) 245,000 7,533,750
- --------------------------------------------------------------------------------
Lone Star Steakhouse & Saloon, Inc.(1) 135,000 3,062,812
- --------------------------------------------------------------------------------
Luby's Cafeterias, Inc. 230,000 4,370,000
- --------------------------------------------------------------------------------
Signature Resorts, Inc.(1) 330,000 6,517,500
- --------------------------------------------------------------------------------
Sodak Gaming, Inc.(1) 200,000 1,412,500
-----------
99,195,312
- --------------------------------------------------------------------------------
Media--2.7%
Applied Graphics Technologies, Inc.(1) 300,000 14,437,500
- --------------------------------------------------------------------------------
Heftel Broadcasting Corp., A Shares(1) 400,000 17,900,000
- --------------------------------------------------------------------------------
Hollinger International, Inc. 200,000 3,325,000
- --------------------------------------------------------------------------------
Petersen Cos., Inc., Cl. A(1) 300,000 7,500,000
- --------------------------------------------------------------------------------
Scholastic Corp.(1) 25,000 1,056,250
- --------------------------------------------------------------------------------
Scientific Games Holdings Corp.(1) 200,000 4,187,500
-----------
48,406,250
</TABLE>
10 Oppenheimer Discovery Fund
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Retail: General--1.0%
North Face, Inc. (The)(1) 210,000 $ 5,092,500
- --------------------------------------------------------------------------------
Russell Corp. 100,000 2,681,250
- --------------------------------------------------------------------------------
Wolverine World Wide, Inc. 374,751 10,586,716
------------
18,360,466
- --------------------------------------------------------------------------------
Retail: Specialty--5.6%
Big Dog Holdings, Inc.(1) 500,000 3,312,500
- --------------------------------------------------------------------------------
Central Garden & Pet Co.(1) 330,000 12,890,625
- --------------------------------------------------------------------------------
Heilig-Meyers Co. 410,000 5,765,625
- --------------------------------------------------------------------------------
Linens 'N Things, Inc.(1) 342,500 18,816,094
- --------------------------------------------------------------------------------
Marks Bros. Jewelers, Inc.(1) 250,000 4,953,125
- --------------------------------------------------------------------------------
MSC Industrial Direct Co., Inc., Cl. A(1) 375,000 20,320,312
- --------------------------------------------------------------------------------
Petco Animal Supplies, Inc.(1) 760,000 14,820,000
- --------------------------------------------------------------------------------
Pier 1 Imports, Inc. 728,100 19,749,712
------------
100,627,993
- --------------------------------------------------------------------------------
Consumer Non-Cyclicals--17.7%
- --------------------------------------------------------------------------------
Beverages--0.4%
Celestial Seasonings, Inc.(1) 163,000 6,683,000
- --------------------------------------------------------------------------------
Education--1.4%
Education Management Corp.(1) 350,000 11,900,000
- --------------------------------------------------------------------------------
Strayer Education, Inc. 400,000 13,300,000
------------
25,200,000
- --------------------------------------------------------------------------------
Food--1.2%
Richfood Holdings, Inc. 222,500 7,120,000
- --------------------------------------------------------------------------------
U.S. Foodservice, Inc.(1) 400,000 14,725,000
------------
21,845,000
- --------------------------------------------------------------------------------
Healthcare/Drugs--1.4%
Applied Analytical Industries, Inc.(1) 180,000 2,902,500
- --------------------------------------------------------------------------------
Biocompatibles International plc(1) 498,044 1,430,353
- --------------------------------------------------------------------------------
Human Genome Sciences, Inc.(1) 70,000 2,786,875
- --------------------------------------------------------------------------------
Incyte Pharmaceuticals, Inc.(1) 277,200 12,959,100
- --------------------------------------------------------------------------------
Roberts Pharmaceutical Corp.(1) 150,000 2,137,500
- --------------------------------------------------------------------------------
Warner Chilcott Laboratories, Sponsored ADR(1) 230,000 2,501,250
------------
24,717,578
- --------------------------------------------------------------------------------
Healthcare/Supplies & Services--13.3%
AmeriSource Health Corp., Cl. A(1) 231,700 13,930,962
- --------------------------------------------------------------------------------
Concentra Managed Care, Inc.(1) 510,000 15,682,500
- --------------------------------------------------------------------------------
Covance, Inc.(1) 500,000 12,281,250
</TABLE>
11 Oppenheimer Discovery Fund
<PAGE>
Statement of Investments (Unaudited) (Continued)
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Healthcare/Supplies & Services (continued)
EndoSonics Corp.(1) 405,000 $ 4,201,875
- --------------------------------------------------------------------------------
ESC Medical Systems Ltd.(1) 280,000 9,835,000
- --------------------------------------------------------------------------------
Healthcare Recoveries, Inc.(1) 300,000 6,975,000
- --------------------------------------------------------------------------------
Henry Schein, Inc.(1) 200,000 8,300,000
- --------------------------------------------------------------------------------
HumaScan, Inc.(1)(2) 584,500 4,310,687
- --------------------------------------------------------------------------------
Invacare Corp. 305,000 7,930,000
- --------------------------------------------------------------------------------
Lincare Holdings, Inc.(1) 180,000 12,712,500
- --------------------------------------------------------------------------------
OrthoLogic Corp.(1) 165,000 1,155,000
- --------------------------------------------------------------------------------
Parexel International Corp.(1) 477,800 14,931,250
- --------------------------------------------------------------------------------
Pediatrix Medical Group, Inc.(1) 325,000 15,112,500
- --------------------------------------------------------------------------------
PSS World Medical, Inc.(1) 525,000 12,337,500
- --------------------------------------------------------------------------------
Renal Care Group, Inc.(1) 275,000 10,450,000
- --------------------------------------------------------------------------------
Rural/Metro Corp.(1) 268,200 8,817,075
- --------------------------------------------------------------------------------
Sabratek Corp.(1) 300,000 10,500,000
- --------------------------------------------------------------------------------
Serologicals Corp.(1) 643,300 18,173,225
- --------------------------------------------------------------------------------
Superior Consultant Holdings Corp.(1) 200,000 7,175,000
- --------------------------------------------------------------------------------
Total Renal Care Holdings, Inc.(1) 600,008 19,987,766
- --------------------------------------------------------------------------------
Ventana Medical Systems, Inc.(1) 425,000 11,315,625
- --------------------------------------------------------------------------------
VWR Scientific Products Corp.(1) 350,000 12,775,000
-----------
238,889,715
- --------------------------------------------------------------------------------
Energy--5.1%
- --------------------------------------------------------------------------------
Energy Services & Producers--5.1%
Brown (Tom), Inc.(1) 400,000 8,950,000
- --------------------------------------------------------------------------------
Core Laboratories NV(1) 400,000 9,750,000
- --------------------------------------------------------------------------------
Cross Timbers Oil Co. 727,500 14,640,937
- --------------------------------------------------------------------------------
Diamond Offshore Drilling, Inc. 141,800 6,434,175
- --------------------------------------------------------------------------------
FX Energy, Inc.(1) 500,000 4,875,000
- --------------------------------------------------------------------------------
Marine Drilling Cos., Inc.(1) 140,000 3,027,500
- --------------------------------------------------------------------------------
Newfield Exploration Co.(1) 200,000 5,212,500
- --------------------------------------------------------------------------------
R & B Falcon Corp.(1) 320,000 9,480,000
- --------------------------------------------------------------------------------
St. Mary Land & Exploration Co. 297,000 11,350,969
- --------------------------------------------------------------------------------
Stolt Comex Seaway SA(1) 526,200 13,253,662
- --------------------------------------------------------------------------------
Western Gas Resources, Inc. 260,000 4,940,000
-----------
91,914,743
- --------------------------------------------------------------------------------
Financial--3.3%
- --------------------------------------------------------------------------------
Banks--0.6%
Ocwen Financial Corp.(1) 400,000 11,100,000
</TABLE>
12 Oppenheimer Discovery Fund
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Diversified Financial--1.6%
First Alliance Corp.(1) 500,000 $ 7,843,750
- --------------------------------------------------------------------------------
Investors Financial Services Corp. 220,000 12,100,000
- --------------------------------------------------------------------------------
Renters Choice, Inc.(1) 385,000 9,432,500
-----------
29,376,250
- --------------------------------------------------------------------------------
Insurance--1.1%
Executive Risk, Inc. 229,800 16,373,250
- --------------------------------------------------------------------------------
Penn-America Group, Inc. 140,000 3,053,750
-----------
19,427,000
- --------------------------------------------------------------------------------
Industrial--19.6%
- --------------------------------------------------------------------------------
Electrical Equipment--0.2%
Vishay Intertechnology, Inc. 180,000 4,230,000
- --------------------------------------------------------------------------------
Industrial Materials--0.2%
Granite Construction, Inc. 131,000 3,668,000
- --------------------------------------------------------------------------------
Industrial Services--16.4%
Abacus Direct Corp.(1) 250,000 13,062,500
- --------------------------------------------------------------------------------
Acxiom Corp.(1) 400,000 10,250,000
- --------------------------------------------------------------------------------
Affiliated Computer Services, Inc., Cl. A(1) 361,700 12,003,919
- --------------------------------------------------------------------------------
Alternative Resources Corp.(1) 250,000 5,265,625
- --------------------------------------------------------------------------------
American Disposal Services, Inc.(1) 250,000 9,437,500
- --------------------------------------------------------------------------------
American Management Systems, Inc.(1) 200,000 5,500,000
- --------------------------------------------------------------------------------
Barnett, Inc.(1) 300,000 6,450,000
- --------------------------------------------------------------------------------
Calgon Carbon Corp. 300,000 3,506,250
- --------------------------------------------------------------------------------
Casella Waste Systems, Inc., Cl. A(1) 200,000 5,287,500
- --------------------------------------------------------------------------------
Central Parking Corp. 200,000 9,550,000
- --------------------------------------------------------------------------------
CIBER, Inc.(1) 300,000 20,981,250
- --------------------------------------------------------------------------------
CORT Business Services Corp.(1) 458,000 21,755,000
- --------------------------------------------------------------------------------
Culligan Water Technologies, Inc.(1) 110,000 6,551,875
- --------------------------------------------------------------------------------
Cuno, Inc.(1) 175,000 3,850,000
- --------------------------------------------------------------------------------
Daisytek International Corp.(1) 570,000 13,893,750
- --------------------------------------------------------------------------------
Eagle USA Airfreight, Inc.(1) 500,000 13,500,000
- --------------------------------------------------------------------------------
Group Maintenance America Corp.(1) 375,000 6,351,563
- --------------------------------------------------------------------------------
Hub Group, Inc., Cl. A(1) 202,500 5,657,344
- --------------------------------------------------------------------------------
Maximus, Inc.(1) 200,000 5,987,500
- --------------------------------------------------------------------------------
Metzler Group, Inc.(1) 370,100 18,412,475
- --------------------------------------------------------------------------------
NCO Group, Inc.(1) 364,100 9,102,500
- --------------------------------------------------------------------------------
Newpark Resources, Inc.(1) 573,200 10,460,900
- --------------------------------------------------------------------------------
Renaissance Worldwide, Inc.(1) 600,000 16,462,500
- --------------------------------------------------------------------------------
Rental Service Corp.(1) 450,000 10,462,500
- --------------------------------------------------------------------------------
Service Experts, Inc.(1) 310,000 9,745,625
</TABLE>
13 Oppenheimer Discovery Fund
<PAGE>
Statement of Investments (Unaudited) (Continued)
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Industrial Services (continued)
StaffMark, Inc.(1) 117,500 $ 4,817,500
- --------------------------------------------------------------------------------
Stericycle, Inc.(1) 350,000 5,206,250
- --------------------------------------------------------------------------------
Transaction Systems Architects, Inc., Cl. A(1) 215,000 8,358,125
- --------------------------------------------------------------------------------
U.S. Rentals, Inc.(1) 345,600 9,547,200
- --------------------------------------------------------------------------------
Wackenhut Corrections Corp.(1) 100,000 2,506,250
- --------------------------------------------------------------------------------
West TeleServices Corp.(1) 623,800 10,448,650
------------
294,372,051
- --------------------------------------------------------------------------------
Manufacturing--2.3%
Applied Power, Inc., Cl. A 400,000 15,400,000
- --------------------------------------------------------------------------------
Chicago Miniature Lamp, Inc.(1) 474,000 18,426,750
- --------------------------------------------------------------------------------
CompX International, Inc.(1)(2) 300,000 7,012,500
------------
40,839,250
- --------------------------------------------------------------------------------
Transportation--0.5%
Avondale Industries, Inc.(1) 225,000 6,468,750
- --------------------------------------------------------------------------------
Genesee & Wyoming, Inc., Cl. A(1) 101,400 2,674,425
------------
9,143,175
- --------------------------------------------------------------------------------
Technology--22.4%
- --------------------------------------------------------------------------------
Aerospace/Defense--0.2%
REMEC, Inc.(1) 127,300 3,651,919
- --------------------------------------------------------------------------------
Computer Hardware--1.5%
Auspex Systems, Inc.(1) 335,000 2,931,250
- --------------------------------------------------------------------------------
Network Appliance, Inc.(1) 350,000 12,425,000
- --------------------------------------------------------------------------------
Telxon Corp. 450,000 11,925,000
------------
27,281,250
- --------------------------------------------------------------------------------
Computer Software/Services--13.6%
Aspen Technologies, Inc.(1) 367,900 15,175,875
- --------------------------------------------------------------------------------
Cambridge Technology Partners, Inc.(1) 250,000 12,390,625
- --------------------------------------------------------------------------------
Check Point Software Technologies Ltd.(1) 100,000 4,568,750
- --------------------------------------------------------------------------------
Documentum, Inc.(1) 300,000 16,237,500
- --------------------------------------------------------------------------------
Dr. Solomon's Group plc, ADR(1) 200,000 6,325,000
- --------------------------------------------------------------------------------
Engineering Animation, Inc.(1) 333,900 13,856,850
- --------------------------------------------------------------------------------
Harbinger Corp.(1) 250,000 9,437,500
- --------------------------------------------------------------------------------
HBO & Co. 160,000 9,660,000
- --------------------------------------------------------------------------------
IMNET Systems, Inc.(1) 60,000 1,350,000
- --------------------------------------------------------------------------------
Inso Corp.(1) 100,000 1,775,000
- --------------------------------------------------------------------------------
Integrated Measurement Systems, Inc.(1)(2) 585,000 7,020,000
- --------------------------------------------------------------------------------
JDA Software Group, Inc.(1) 400,000 21,250,000
</TABLE>
14 Oppenheimer Discovery Fund
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Computer Software/Services (continued)
LodgeNet Entertainment Corp.(1) 425,000 $ 4,953,906
- --------------------------------------------------------------------------------
National Instruments Corp.(1) 553,500 18,888,188
- --------------------------------------------------------------------------------
Network Associates, Inc.(1) 80,427 5,328,289
- --------------------------------------------------------------------------------
Progress Software Corp.(1) 140,000 4,200,000
- --------------------------------------------------------------------------------
Rational Software Corp.(1) 425,000 5,525,000
- --------------------------------------------------------------------------------
Saville Systems Ireland plc, Sponsored ADR(1) 700,000 35,875,000
- --------------------------------------------------------------------------------
USCS International, Inc.(1) 250,000 5,328,125
- --------------------------------------------------------------------------------
USWeb Corp.(1) 250,000 5,531,250
- --------------------------------------------------------------------------------
Visio Corp.(1) 700,000 30,100,000
- --------------------------------------------------------------------------------
Zebra Technologies Corp., Cl. A(1) 250,000 9,625,000
------------
244,401,858
- --------------------------------------------------------------------------------
Electronics--4.0%
ATMI, Inc.(1) 508,800 15,391,200
- --------------------------------------------------------------------------------
Electro Scientific Industries, Inc.(1) 250,000 9,656,250
- --------------------------------------------------------------------------------
Lernout & Hauspie Speech Products NV(1) 123,700 10,808,288
- --------------------------------------------------------------------------------
Pittway Corp., Cl. A 400,000 28,800,000
- --------------------------------------------------------------------------------
Sawtek, Inc.(1) 179,600 4,557,350
- --------------------------------------------------------------------------------
Trimble Navigation Ltd.(1) 150,000 2,671,875
------------
71,884,963
- --------------------------------------------------------------------------------
Telecommunications-Technology--3.1%
Electric Lightwave, Inc.(1) 300,000 6,000,000
- --------------------------------------------------------------------------------
General Cable Corp. 350,000 15,881,250
- --------------------------------------------------------------------------------
ICG Communications, Inc.(1)(4) 272,500 9,643,094
- --------------------------------------------------------------------------------
Intermedia Communications, Inc.(1) 100,000 7,962,500
- --------------------------------------------------------------------------------
Lightbridge, Inc.(1) 384,600 6,946,838
- --------------------------------------------------------------------------------
Pacific Gateway Exchange, Inc.(1) 120,000 6,870,000
- --------------------------------------------------------------------------------
Vanguard Cellular Systems, Inc.(1) 75,000 1,364,063
------------
54,667,745
- --------------------------------------------------------------------------------
Utilities--3.9%
- --------------------------------------------------------------------------------
Gas Utilities--0.3%
Cabot Oil & Gas Corp., Cl. A 260,000 5,882,500
- --------------------------------------------------------------------------------
Telephone Utilities--3.6%
ICG Communications, Inc.(1) 230,000 8,567,500
- --------------------------------------------------------------------------------
IXC Communications, Inc.(1) 130,000 7,418,125
- --------------------------------------------------------------------------------
Metrocall, Inc.(1) 525,000 3,675,000
- --------------------------------------------------------------------------------
NEXTLINK Communications, Inc., Cl. A(1) 250,000 8,031,250
- --------------------------------------------------------------------------------
RSL Communications Ltd., Cl. A(1) 300,000 6,900,000
- --------------------------------------------------------------------------------
Star Telecommunications, Inc.(1) 175,000 9,734,375
</TABLE>
15 Oppenheimer Discovery Fund
<PAGE>
Statement of Investments (Unaudited) (Continued)
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Telephone Utilities (continued)
Tel-Save Holdings, Inc.(1) 266,000 $ 6,051,500
- ---------------------------------------------------------------------------------------------------
Telegroup, Inc.(1) 720,000 14,580,000
--------------
64,957,750
--------------
Total Common Stocks (Cost $1,097,925,565) 1,606,988,018
- ---------------------------------------------------------------------------------------------------
Preferred Stocks--0.8%
- ---------------------------------------------------------------------------------------------------
AirNet Communications Corp., Series C(1)(4) 250,000 250,000
- ---------------------------------------------------------------------------------------------------
Candescent Technologies Corp., $2.50 Cv., Series D(1)(4) 1,200,000 7,380,000
- ---------------------------------------------------------------------------------------------------
Candescent Technologies Corp., Series E, Preferred Stock(1)(4) 800,000 5,768,000
- ---------------------------------------------------------------------------------------------------
Candescent Technologies Corp., Series F, Preferred Stock(1)(4) 200,000 1,500,000
--------------
Total Preferred Stocks (Cost $10,400,000) 14,898,000
</TABLE>
<TABLE>
<CAPTION>
Face
Amount
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Convertible Corporate Bonds and Notes--0.5%
- ---------------------------------------------------------------------------------------------------
American Retirement Corp., 5.75% Cv. Sub. Debs., 10/1/02 $ 2,280,000 2,508,000
- ---------------------------------------------------------------------------------------------------
Sunrise Assisted Living, Inc., 5.50% Cv. Nts., 6/15/02(5) 5,059,000 6,861,269
-------------
Total Convertible Corporate Bonds and Notes (Cost $7,437,600) 9,369,269
</TABLE>
<TABLE>
<CAPTION>
Date Strike Contracts
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Put Options Purchased--0.0%
- ---------------------------------------------------------------------------------------------------
Tel-Save Holdings, Inc. Put Opt.
(Cost $384,878) 4/98 $ 25 1,500 375,000
</TABLE>
<TABLE>
<CAPTION>
Face
Amount
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Short-Term Notes--2.8%
- ---------------------------------------------------------------------------------------------------
General Electric Capital Services, Inc., 5.55%, 4/8/98(6)
(Cost $49,946,042) $ 50,000,000 49,946,042
- ---------------------------------------------------------------------------------------------------
Repurchase Agreements--7.0%
- ---------------------------------------------------------------------------------------------------
Repurchase agreement with First Chicago Capital Markets, 5.90%, dated 3/31/98,
to be repurchased at $126,420,716 on 4/1/98, collateralized by U.S. Treasury
Bonds, 7.125%-10.625%, 8/15/15-2/15/23, with a value of $51,095,652, and U.S.
Treasury Nts., 5.75%-6.625%, 2/28/99-8/15/05, with a value of $77,875,434
(Cost $126,400,000) 126,400,000 126,400,000
- ---------------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $1,292,494,085) 100.5% 1,807,976,328
- ---------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (0.5) (9,273,833)
------------- -------------
Net Assets 100.0% $1,798,702,495
============= =============
</TABLE>
16 Oppenheimer Discovery Fund
<PAGE>
- --------------------------------------------------------------------------------
1. Non-income producing security.
2. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended March 31, 1998.
The aggregate fair value of securities of affiliated companies held by the Fund
as of March 31, 1998 amounts to $18,343,187. Transactions during the period in
which the issuer was an affiliate are as follows:
<TABLE>
<CAPTION>
Shares Gross Gross Shares
Sept. 30, 1997 Additions Reductions March 31, 1998
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CompX International, Inc. -- 300,000 -- 300,000
- ----------------------------------------------------------------------------------------------------------
EP Medsystems, Inc. 400,000 -- 400,000 --
- ----------------------------------------------------------------------------------------------------------
HumaScan, Inc. 584,500 -- -- 584,500
- ----------------------------------------------------------------------------------------------------------
Integrated Measurement Systems, Inc.(3) 350,000 235,000 -- 585,000
- ----------------------------------------------------------------------------------------------------------
IntelliQuest Information Group, Inc. 490,000 -- 490,000 --
- ----------------------------------------------------------------------------------------------------------
Norland Medical Systems, Inc. 480,000 -- 480,000 --
- ----------------------------------------------------------------------------------------------------------
SPSS, Inc. 412,500 -- 412,500 --
- ----------------------------------------------------------------------------------------------------------
Silver Diner, Inc. 700,000 -- 700,000 --
</TABLE>
3. Not an affiliate as of September 30, 1997.
4. Identifies issues considered to be illiquid or restricted--See Note 5 of
Notes to Financial Statements.
5. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $6,861,269 or 0.38% of the Fund's net
assets as of March 31, 1998.
6. Short-term notes are generally traded on a discount basis; the interest rate
is the discount rate received by the Fund at the time of purchase.
See accompanying Notes to Financial Statements.
17 Oppenheimer Discovery Fund
<PAGE>
Statement of Assets and Liabilities March 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
<S> <C>
Assets
Investments, at value--see accompanying statement:
Unaffiliated companies (cost $1,272,387,148) $1,789,633,142
Affiliated companies (cost $20,106,937) 18,343,187
- ---------------------------------------------------------------------------------------
Cash 301,043
- ---------------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 3,148,877
Investments sold 810,958
Interest and dividends 327,669
- ---------------------------------------------------------------------------------------
Other 53,498
--------------
Total assets 1,812,618,374
- ---------------------------------------------------------------------------------------
Liabilities
Payables and other liabilities:
Investments purchased 8,870,849
Shares of beneficial interest redeemed 3,037,444
Distribution and service plan fees 1,002,094
Transfer and shareholder servicing agent fees 424,084
Shareholder reports 265,510
Trustees' fees--Note 1 246,920
Other 68,978
--------------
Total liabilities 13,915,879
- ---------------------------------------------------------------------------------------
Net Assets $1,798,702,495
==============
- ---------------------------------------------------------------------------------------
Composition of Net Assets
Paid-in capital $1,194,617,220
- ---------------------------------------------------------------------------------------
Accumulated net investment loss (5,777,122)
- ---------------------------------------------------------------------------------------
Accumulated net realized gain on investments and
foreign currency transactions 94,380,153
- ---------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets
and liabilities denominated in foreign currencies 515,482,244
--------------
Net assets $1,798,702,495
==============
</TABLE>
18 Oppenheimer Discovery Fund
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
<S> <C>
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets
of $1,347,249,754 and 25,191,854 shares of beneficial interest outstanding) $ 53.48
Maximum offering price per share (net asset value plus sales charge of
5.75% of offering price) $ 56.74
- --------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $357,698,923
and 6,929,312 shares of beneficial interest outstanding) $ 51.62
- --------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $44,496,933
and 849,543 shares of beneficial interest outstanding) $ 52.38
- --------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $49,256,885 and 911,210 shares of beneficial interest outstanding) $ 54.06
</TABLE>
See accompanying Notes to Financial Statements.
19 Oppenheimer Discovery Fund
<PAGE>
Statement of Operations For the Six Months Ended March 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
<S> <C>
Investment Income
Interest $ 5,534,610
- -------------------------------------------------------------------------------------
Dividends 875,994
-----------
Total income 6,410,604
- -------------------------------------------------------------------------------------
Expenses
Management fees--Note 4 5,390,768
- -------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 1,535,318
Class B 1,592,977
Class C 203,692
- -------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4:
Class A 1,592,266
Class B 390,827
Class C 42,557
Class Y 21,133
- -------------------------------------------------------------------------------------
Shareholder reports 265,510
- -------------------------------------------------------------------------------------
Trustees' fees and expenses--Note 1 69,410
- -------------------------------------------------------------------------------------
Custodian fees and expenses 65,734
- -------------------------------------------------------------------------------------
Legal and auditing fees 40,472
- -------------------------------------------------------------------------------------
Insurance expenses 10,014
- -------------------------------------------------------------------------------------
Other 27,569
-----------
Total expenses 11,248,247
- -------------------------------------------------------------------------------------
Net Investment Loss (4,837,643)
- -------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments:
Unaffiliated companies 108,446,065
Affiliated companies (10,313,415)
-----------
Net realized gain 98,132,650
- -------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments (274,965)
Translation of assets and liabilities denominated in foreign currencies 129,006
-----------
Net change (145,959)
-----------
Net realized and unrealized gain 97,986,691
- -------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $93,149,048
===========
</TABLE>
See accompanying Notes to Financial Statements.
20 Oppenheimer Discovery Fund
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Ended Year Ended
March 31, 1998 September 30,
(Unaudited) 1997
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment loss $ (4,837,643) $ (4,321,612)
- -------------------------------------------------------------------------------------------------
Net realized gain 98,132,650 35,559,232
- -------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation (145,959) 125,204,282
-------------- --------------
Net increase in net assets resulting from operations 93,149,048 156,441,902
- -------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders
Distributions from net realized gain:
Class A (24,482,083) (80,609,827)
Class B (6,342,658) (15,203,908)
Class C (799,600) (1,451,890)
Class Y (833,135) (2,352,509)
- -------------------------------------------------------------------------------------------------
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting
from beneficial interest transactions--Note 2:
Class A (28,671,844) 135,425,471
Class B 23,098,583 112,330,605
Class C 1,430,043 20,931,283
Class Y 2,414,976 11,373,727
- -------------------------------------------------------------------------------------------------
Net Assets
Total increase 58,963,330 336,884,854
- -------------------------------------------------------------------------------------------------
Beginning of period 1,739,739,165 1,402,854,311
-------------- --------------
End of period (including accumulated net investment losses
of $5,777,122 and $939,479, respectively) $1,798,702,495 $1,739,739,165
============== ==============
</TABLE>
See accompanying Notes to Financial Statements.
21 Oppenheimer Discovery Fund
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Class A
-----------------------------------------------------------------------------
Six Months
Ended
March 31,
1998 Year Ended September 30,
(Unaudited) 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $ 51.72 $ 51.19 $ 43.65 $ 35.81 $ 39.90
- -----------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.11) (.08) (.13) -- (.11)
Net realized and unrealized gain (loss) 2.84 4.12 11.26 9.46 (2.98)
---------- ---------- ---------- -------- ----------
Total income (loss) from investment
operations 2.73 4.04 11.13 9.46 (3.09)
- -----------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net
realized gain (.97) (3.51) (3.59) (1.62) (1.00)
- -----------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 53.48 $ 51.72 $ 51.19 $ 43.65 $ 35.81
========== ========== ========== ======== ==========
- -----------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value(4) 5.60% 9.16% 27.76% 28.03% (7.91)%
- -----------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period
(in thousands) $1,347,250 $1,330,172 $1,160,087 $798,065 $613,740
- -----------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $1,263,398 $1,119,302 $ 937,563 $650,903 $588,642
- -----------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (0.43)%(5) (0.17)% (0.32)% 0.00% (0.34)%
Expenses 1.20%(5) 1.22% 1.22% 1.33% 1.32%
- -----------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 30.8% 68.7% 79.7% 105.9% 83.3%
Average brokerage commission rate(7) $ 0.0600 $ 0.0600 $ 0.0577 -- --
</TABLE>
1. For the period from June 1, 1994 (inception of offering) to September 30,
1994.
2. For the period from October 2, 1995 (inception of offering) to September 30,
1996.
3. For the period from April 1, 1994 (inception of offering) to September 30,
1994.
4. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
5. Annualized.
22 Oppenheimer Discovery Fund
<PAGE>
<TABLE>
<CAPTION>
Class B
------------------------------------------------------------------------------
Six Months
Ended
March 31,
1998 Year Ended September 30,
1993 (Unaudited) 1997 1996 1995 1994(3)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 27.62 $ 50.15 $ 50.10 $ 43.11 $ 35.65 $ 35.65
- ----------------------------------------------------------------------------------------------
(.13) (.23) (.23) (.23) (.21) .03
12.41 2.67 3.79 10.81 9.29 (.03)
------- ------- -------- -------- ------- -------
12.28 2.44 3.56 10.58 9.08 --
- ----------------------------------------------------------------------------------------------
-- (.97) (3.51) (3.59) (1.62) --
- ----------------------------------------------------------------------------------------------
$ 39.90 $ 51.62 $ 50.15 $ 50.10 $ 43.11 $ 35.65
======= ======== ======== ======== ======= =======
- ----------------------------------------------------------------------------------------------
44.46% 5.21% 8.33% 26.77% 27.04% (1.93)%
- ----------------------------------------------------------------------------------------------
$587,057 $357,699 $322,736 $193,637 $75,062 $26,491
- ----------------------------------------------------------------------------------------------
$451,016 $319,665 $233,172 $119,895 $43,301 $12,435
- ----------------------------------------------------------------------------------------------
(0.54)% (1.18)%(5) (0.93)% (1.06)% (0.78)% (1.06)%(5)
1.27% 1.95%(5) 1.97% 1.99% 2.11% 2.36%(5)
- ----------------------------------------------------------------------------------------------
85.2% 30.8% 68.7% 79.7% 105.9% 83.3%
-- $ 0.0600 $ 0.0600 $ 0.0577 -- --
<CAPTION>
Class C
- ----------------------------------------------
Six Months
Ended
March 31, Year Ended
1998 September 30,
(Unaudited) 1997 1996(2)
- ----------------------------------------------
<C> <C> <C>
$ 50.86 $ 50.73 $ 43.20
- ----------------------------------------------
(.24) (.26) (.21)
2.73 3.90 11.33
-------- ------- --------
2.49 3.64 11.12
- ----------------------------------------------
(.97) (3.51) (3.59)
- ----------------------------------------------
$ 52.38 $ 50.86 $ 50.73
======== ======= ========
- ----------------------------------------------
5.24% 8.39% 27.96%
- ----------------------------------------------
$ 44,497 $41,720 $ 17,512
- ----------------------------------------------
$ 40,861 $26,361 $ 7,109
- ----------------------------------------------
(1.14)%(5) (0.92)% (1.00)%(5)
1.91%(5) 1.94% 2.03%(5)
- ----------------------------------------------
30.8% 68.7% 79.7%
$ 0.0600 $0.0600 $ 0.0577
</TABLE>
6. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended March 31, 1998 were $495,356,218 and $462,381,609, respectively.
7. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
23 Oppenheimer Discovery Fund
<PAGE>
Financial Highlights (Continued)
<TABLE>
<CAPTION>
Class Y
---------------------------------------------------------------------------------
Six Months
Ended
March 31,
1998 Year Ended September 30,
(Unaudited) 1997 1996 1995 1994(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $ 52.17 $ 51.44 $ 43.74 $35.81 $ 34.89
- ---------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.01) .02 (.02) (.10) .11
Net realized and unrealized gain (loss) 2.87 4.22 11.31 9.65 .81
--------- --------- -------- ------ -------
Total income (loss) from investment
operations 2.86 4.24 11.29 9.55 .92
- ---------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net
realized gain (.97) (3.51) (3.59) (1.62) --
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 54.06 $ 52.17 $ 51.44 $43.74 $ 35.81
========= ========= ======== ====== =======
- ---------------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value(4) 5.82% 9.50% 28.09% 28.28% 3.20%
- ---------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period
(in thousands) $ 49,257 $ 45,112 $ 31,619 $9,394 $ 194
- ---------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 43,833 $ 34,811 $ 18,563 $3,190 $ 39
- ---------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (0.03)%(5) 0.15% (0.04)% 0.03% (0.13)%(5)
Expenses 0.80 %(5) 0.89% 0.99% 1.26% 1.41%(5)
- ---------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 30.8% 68.7% 79.7% 105.9% 83.3%
Average brokerage commission rate(7) $ 0.0600 $ 0.0600 $0.0577 -- --
</TABLE>
1. For the period from June 1, 1994 (inception of offering) to September 30,
1994.
2. For the period from October 2, 1995 (inception of offering) to September 30,
1996.
3. For the period from April 1, 1994 (inception of offering) to September 30,
1994.
4. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
5. Annualized.
6. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended March 31, 1998 were $495,356,218 and $462,381,609, respectively.
7. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
24 Oppenheimer Discovery Fund
<PAGE>
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Oppenheimer Discovery Fund (the Fund) is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company. The Fund's investment objective is capital appreciation; current income
is not an objective. In seeking its objective, the Fund emphasizes investments
in securities of "growth-type" companies, including common stocks, preferred
stocks, convertible securities, rights, warrants and options. The Fund's
investment advisor is OppenheimerFunds, Inc. (the Manager). The Fund offers
Class A, Class B, Class C and Class Y shares. Class A shares are sold with a
front-end sales charge. Class B and Class C shares may be subject to a
contingent deferred sales charge. All classes of shares have identical rights to
earnings, assets and voting privileges, except that each class has its own
expenses directly attributable to that class and exclusive voting rights with
respect to matters affecting that class. Classes A, B and C have separate
distribution and/or service plans. No such plan has been adopted for Class Y
shares. Class B shares will automatically convert to Class A shares six years
after the date of purchase. The following is a summary of significant accounting
policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
Investment Valuation. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
the last sale price on the prior trading day. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Trustees. Such securities which cannot be valued by an
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Trustees to
determine fair value in good faith. Short-term "money market type" debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount. Options are valued based upon the last sale price on the
principal exchange on which the option is traded or, in the absence of any
transactions that day, the value is based upon the last sale price on the prior
trading date if it is within the spread between the closing bid and asked
prices. If the last sale price is outside the spread, the closing bid is used.
25 Oppenheimer Discovery Fund
<PAGE>
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies (continued)
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is
required to be at least 102% of the resale price at the time of purchase. If
the seller of the agreement defaults and the value of the collateral declines,
or if the seller enters an insolvency proceeding, realization of the value of
the collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
Federal Taxes. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
Trustees' Fees and Expenses. The Fund has adopted a nonfunded retirement plan
for the Fund's independent trustees. Benefits are based on years of service and
fees paid to each trustee during the years of service. During the six months
ended March 31, 1998, a provision of $29,014 was made for the Fund's projected
benefit obligations, and payments of $11,314 were made to retired trustees,
resulting in an accumulated liability of $229,567 at March 31, 1998.
- --------------------------------------------------------------------------------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
Classification of Distributions to Shareholders. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of the recognition of certain foreign currency gains (losses)
as ordinary income (loss) for tax purposes. The character of the distributions
made during the year from net investment income or net realized gains may differ
from its ultimate characterization for federal income tax purposes. Also, due to
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the fiscal year in which the income or realized gain
was recorded by the Fund.
26 Oppenheimer Discovery Fund
<PAGE>
- --------------------------------------------------------------------------------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Realized gains and losses on investments and unrealized
appreciation and depreciation are determined on an identified cost basis, which
is the same basis used for federal income tax purposes.
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
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
- --------------------------------------------------------------------------------
2. Shares of Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest of each class. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
Six Months Ended March 31, 1998 Year Ended September 30, 1997
--------------------------------- ----------------------------------
Shares Amount Shares Amount
--------------- ----------------- ---------------- -----------------
<S> <C> <C> <C> <C>
Class A:
Sold 7,227,928 $354,762,559 11,525,612 $516,255,667
Distributions reinvested 526,349 23,985,678 1,804,573 78,737,385
Redeemed (8,280,011) (407,420,081) (10,273,804) (459,567,581)
---------- ------------ ----------- ------------
Net increase (decrease) (525,734) $(28,671,844) 3,056,381 $135,425,471
========== ============ =========== ============
- ------------------------------------------------------------------------------------------
Class B:
Sold 1,395,979 $ 66,413,698 4,023,759 $175,948,220
Distributions reinvested 140,306 6,184,707 348,742 14,842,538
Redeemed (1,042,795) (49,499,822) (1,801,954) (78,460,153)
---------- ------------ ----------- ------------
Net increase 493,490 $ 23,098,583 2,570,547 $112,330,605
========== ============ =========== ============
- ------------------------------------------------------------------------------------------
Class C:
Sold 477,852 $ 23,168,175 1,235,025 $ 54,325,325
Distributions reinvested 17,282 773,025 33,285 1,434,706
Redeemed (465,967) (22,511,157) (793,137) (34,828,748)
---------- ------------ ----------- ------------
Net increase 29,167 $ 1,430,043 475,173 $ 20,931,283
========== ============ =========== ============
- ------------------------------------------------------------------------------------------
Class Y:
Sold 254,073 $ 12,718,711 646,438 $ 29,225,305
Distributions reinvested 18,108 833,135 53,588 2,352,509
Redeemed (225,732) (11,136,870) (449,978) (20,204,087)
---------- ------------ ----------- ------------
Net increase 46,449 $ 2,414,976 250,048 $ 11,373,727
========== ============ =========== ============
</TABLE>
27 Oppenheimer Discovery Fund
<PAGE>
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
3. Unrealized Gains and Losses on Investments
At March 31, 1998, net unrealized appreciation on investments of $515,482,244
was composed of gross appreciation of $542,328,406, and gross depreciation of
$26,846,162.
- --------------------------------------------------------------------------------
4. Management Fees and Other Transactions with Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of 0.75% on the first
$200 million of average annual net assets, 0.72% of the next $200 million, 0.69%
of the next $200 million, 0.66% of the next $200 million, 0.60% of the next $700
million and 0.58% of average annual net assets in excess of $1.5 billion.
For the six months ended March 31, 1998, commissions (sales
charges paid by investors) on sales of Class A shares totaled $1,691,566, of
which $545,805 was retained by OppenheimerFunds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B and Class C shares totaled $1,485,094 and $72,750, respectively,
of which $190,885 and $2,868, respectively, was paid to an affiliated
broker/dealer. During the six months ended March 31, 1998, OFDI received
contingent deferred sales charges of $339,359 and $6,573, respectively, upon
redemption of Class B and Class C shares, as reimbursement for sales commissions
advanced by OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund and for other registered
investment companies. OFS's total costs of providing such services are allocated
ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to
reimburse OFDI for a portion of its costs incurred in connection with the
personal service and maintenance of shareholder accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate that may not exceed
0.25% of the average annual net assets of Class A shares of the Fund. OFDI uses
the service fee to reimburse brokers, dealers, banks and other financial
institutions quarterly for providing personal service and maintenance of
accounts of their customers that hold Class A shares. During the six months
ended March 31, 1998, OFDI paid $124,437 to an affiliated broker/dealer as
reimbursement for Class A personal service and maintenance expenses.
28 Oppenheimer Discovery Fund
<PAGE>
- --------------------------------------------------------------------------------
The Fund has adopted a Distribution and Service Plan for Class B shares to
reimburse OFDI for its costs in distributing Class B shares and servicing
accounts. Under the Plan, the Fund pays OFDI an annual asset-based sales charge
of 0.75% per year on Class B shares for its services in distributing Class B
shares. OFDI also receives a service fee of 0.25% per year to reimburse dealers
for providing personal services for accounts that hold Class B shares. Each fee
is computed on the average annual net assets of Class B shares, determined as of
the close of each regular business day. During the six months ended March 31,
1998, OFDI paid $22,387 to an affiliated broker/dealer as reimbursement for
Class B personal service and maintenance expenses and retained $1,337,508 as
reimbursement for Class B sales commissions and service fee advances, as well as
financing costs. If the Plan is terminated by the Fund, the Board of Trustees
may allow the Fund to continue payments of the asset-based sales charge to OFDI
for distributing shares before the Plan was terminated. As of March 31, 1998,
OFDI had incurred excess distribution and servicing costs of $8,165,363 for
Class B.
The Fund has adopted a Distribution and Service Plan for Class C
shares to compensate OFDI for its costs in distributing Class C shares and
servicing accounts. Under the Plan, the Fund pays OFDI an annual asset-based
sales charge of 0.75% per year on Class C shares for its services in
distributing Class C shares. OFDI also receives a service fee of 0.25% per year
to compensate dealers for providing personal services for accounts that hold
Class C shares. Each fee is computed on the average annual net assets of Class C
shares, determined as of the close of each regular business day. During the six
months ended March 31, 1998, OFDI paid $2,701 to an affiliated broker/dealer as
reimbursement for Class C personal service and maintenance expenses and retained
$124,888 as compensation for Class C sales commissions and service fee advances,
as well as financing costs. If the Plan is terminated by the Fund, the Board of
Trustees may allow the Fund to continue payments of the asset-based sales charge
to OFDI for distributing shares it incurred before the Plan was terminated. As
of March 31, 1998, OFDI had incurred excess distribution and servicing costs of
$385,393 for Class C.
29 Oppenheimer Discovery Fund
<PAGE>
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
5. Illiquid and Restricted Securities
At March 31, 1998, investments in securities included issues that are illiquid
or restricted. Restricted securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund intends to invest no more than
10% of its net assets (determined at the time of purchase and reviewed
periodically) in illiquid or restricted securities. Certain restricted
securities, eligible for resale to qualified institutional investors, are not
subject to that limit. The aggregate value of illiquid or restricted securities
subject to this limitation at March 31, 1998 was $24,541,094, which represents
1.36% of the Fund's net assets, of which $17,161,094 is considered restricted.
Information concerning restricted securities is as follows:
<TABLE>
<CAPTION>
Valuation
Cost Per Unit as of
Security Acquisition Date Per Unit March 31, 1998
- ------------------------------- ------------------ --------------- ---------------
<S> <C> <C> <C>
AirNet Communications Corp.,
Series C 7/6/95 $6.00 $ 1.00
- ------------------------------- ------------------ --------------- ---------------
Candescent Technologies Corp.,
Series E, Preferred Stock 4/24/96 5.50 7.21
- ------------------------------- -------------- ----------- ---------------
Candescent Technologies Corp.,
Series F, Preferred Stock 6/11/97 7.50 7.50
- ------------------------------- -------------- ----------- ---------------
ICG Communications, Inc. 6/9/93-5/10/95 5.50-13.89 35.39
</TABLE>
- --------------------------------------------------------------------------------
6. Bank Borrowings
The Fund may borrow from a bank for temporary or emergency purposes including,
without limitation, funding of shareholder redemptions provided asset coverage
for borrowings exceeds 300%. The Fund has entered into an agreement which
enables it to participate with other Oppenheimer funds in an unsecured line of
credit with a bank, which permits borrowings up to $400 million, collectively.
Interest is charged to each fund, based on its borrowings, at a rate equal to
the Federal Funds Rate plus 0.35%. Borrowings are payable after such loan is
executed. The Fund also pays a commitment fee equal to its pro rata share of the
average unutilized amount of the credit facility at a rate of 0.0575% per annum.
The Fund had no borrowings outstanding during the six months ended
March 31, 1998.
30 Oppenheimer Discovery Fund
<PAGE>
Oppenheimer Discovery Fund
- --------------------------------------------------------------------------------
Officers and Trustees Leon Levy, Chairman of the Board of Trustees
Donald W. Spiro, Vice Chairman of the Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Jay W. Tracey, III, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
- --------------------------------------------------------------------------------
Investment Advisor OppenheimerFunds, Inc.
- --------------------------------------------------------------------------------
Distributor OppenheimerFunds Distributor, Inc.
- --------------------------------------------------------------------------------
Transfer and Shareholder OppenheimerFunds Services
Servicing Agent
- --------------------------------------------------------------------------------
Custodian of The Bank of New York
Portfolio Securities
- --------------------------------------------------------------------------------
Independent Auditors KPMG Peat Marwick LLP
- --------------------------------------------------------------------------------
Legal Counsel Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have been
taken from the records of the Fund without examination
of the independent auditors. This is a copy of a report
to shareholders of Oppenheimer Discovery Fund. This
report must be preceded or accompanied by a Prospectus
of Oppenheimer Discovery Fund. For material information
concerning the Fund, see the Prospectus.
Shares of Oppenheimer funds are not deposits or
obligations of any bank, are not guaranteed by any
bank, and are not insured by the FDIC or any other
agency, and involve investment risks, including
possible loss of the principal amount invested.
31 Oppenheimer Discovery Fund
<PAGE>
Internet
24-hr access to account
information. Online
transactions now available
www.oppenheimerfunds.com
General Information
Mon-Fri 8:30am-9pm ET
Sat 10am-4pm ET
1-800-525-7048
Account Transactions
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OppenheimerFunds
Information Hotline
24 hours a day, timely and
insightful messages on the
economy and issues that
affect your investments
1-800-835-3104
Information and services
- --------------------------------------------------------------------------------
As an Oppenheimer fund shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number or by visiting our website. And, by
enrolling in AccountLink, a convenient service that "links" your Oppenheimer
funds accounts and your bank checking or savings account, you can use the
Telephone Transactions number or website to make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
[OppenheimerFunds logo]
Distributor, Inc.
RS0500.001.0398 May 29, 1998
