[Cover]
--------------------------------
Semiannual Report April 30, 1998
--------------------------------
O P P E N H E I M E R
Quest Capital
Value Fund, Inc.
[GRAPHIC: Calculator, pencil, & savings book]
[OPPENHEIMER FUNDS LOGO]
OppenheimerFunds(SM)
THE RIGHT WAY TO INVEST
<PAGE>
Report highlights
- --------------------------------------------------------------------------------
Contents
3 President's Letter
4 Fund Performance
6 An Interview
with the Fund's
Manager
10 Statement of
Investments
12 Statement of
Assets and
Liabilities
14 Statement of
Operations
15 Statements of
Changes in
Net Assets
16 Financial Highlights
19 Notes to Financial
Statements
25 Officers and
Directors
28 Information and
Services
[bullet] The Fund's holdings tend to be mid-sized issuers, which have generally
underperformed large company shares during the period.
[bullet] Telecommunications and financial services stocks led the way. WorldCom,
one of the world's pre-eminent telecommunications companies, and H&R Block,
America's leading tax preparation service, posted strong returns.
<TABLE>
<S> <C>
- --------------------------------
Cumulative Total Returns
- ---------------------------------
For the 6-Month Period
Ended 4/30/98
Class A
Without With
Sales Chg.(1) Sales Chg.(2)
- --------------------------------
15.85% 9.19%
- --------------------------------
Class B
Without With
Sales Chg.(1) Sales Chg.(2)
- --------------------------------
15.49% 11.56%
- --------------------------------
Class C
Without With
Sales Chg.(1) Sales Chg.(2)
- --------------------------------
15.47% 14.68%
- --------------------------------
</TABLE>
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. The Fund's
investment advisor is OppenheimerFunds, Inc., and its Subadvisor is OpCap
Advisors (the Fund's advisor until 2/28/97).
The Fund commenced operations on 2/13/87 as a closed-end investment company,
formerly named Quest for Value Dual Purpose Fund, Inc., with a dual purpose
structure and two classes of shares, Income shares and Capital shares. Under the
prior dual purpose structure, Capital shares were entitled to all gains and
losses on all Fund assets and no expenses were allocated to such shares; the
Income shares bore all of the Fund's operating expenses. On 1/31/97, the Fund
redeemed its Income shares, which are no longer outstanding, and its dual
purpose structure terminated. On 3/3/97, the Fund converted from a closed-end
fund to an open-end fund, and its outstanding Capital shares were designated as
Class A shares now bearing their allocable share of the Fund's expenses.
1. Includes change in net asset value per share without deducting any sales
charges. This performance is not annualized.
2. Class A shares total returns reflect the historical performance of the Class
A shares of the Fund (formerly Capital shares) as adjusted for the fees and
expenses of Class A shares in effect as of 3/3/97 (without giving effect to any
fee waivers). Average annual total returns for Class A shares includes the
current 5.75% maximum initial sales charge. Class B returns include the
applicable contingent deferred sales charge of 5%. Class C returns include the
contingent deferred sales charge of 1%. Additional information on charges and
expenses is in the Fund's prospectus. Class B and C shares are subject to an
annual 0.75% asset-based sales charge and Class A shares are subject to an
annual 0.25% asset-based sales charge (the Fund's distributor has voluntarily
agreed to waive 0.15% of this fee until 2/28/99).
2 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
Dear shareholder,
- --------------------------------------------------------------------------------
[PHOTO OF BRIDGET A. MACASKILL]
Bridget A. Macaskill
President
Oppenheimer Quest
Capital Value Fund, Inc.
As we move further into 1998, we remain impressed by the remarkable resilience
of the financial markets. Recent efforts by the United States to help support
the Japanese Yen have inspired hope that the fallout of the Asian economic
crisis can be contained. In general, the U.S. and world markets have continued
to build wealth for investors at a virtually unprecedented pace.
At OppenheimerFunds, we are pleased to help our fund shareholders
participate in the potential rewards of today's markets, but we also recognize
that this rate of growth cannot last forever. Because no one can predict
exactly when the next correction or bear market might occur, we think it is
prudent to continually identify, evaluate and manage the risks that may affect
our fund shareholders.
We believe that one of the leading risks facing investors today is that
stock valuations are at the high end of their historical range, while U.S.
corporate earnings growth is slowing. Given these facts, we believe it is
unlikely that stocks will sustain the growth rate of the past three years.
Stock prices could continue trading near current levels until earnings "catch
up," or there could be a market correction. However, we believe that either
scenario would be only a temporary pause on the way to potentially greater
long-term gains.
We are also examining the potential economic effects of the "millennium
problem" that may render many computer systems unable to recognize the year 2000
when it arrives. Solving this problem has required companies to divert
substantial human and financial resources from their core businesses, possibly
constraining global economic growth during 1999 and 2000.
For our part, we can report that OppenheimerFunds has made solid progress
toward ensuring that our shareholder accounting systems are fully "year 2000
compliant," and that all shareholder accounts will make a seamless transition
into the 21st century.
We encourage you to meet with your financial advisor to discuss how a
possible market correction or the millennium problem may affect your
investments. Together, you can prepare your investment portfolio for the
challenges and opportunities of the new century.
/s/ Bridget A. Macaskill
- ------------------------
Bridget A. Macaskill
May 21, 1998
3 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
Performance update
- --------------------------------------------------------------------------------
For the six-month period ended April 30, 1998, the Oppenheimer Quest Capital
Value Fund, Inc. Class A shares produced a cumulative total return, without
sales charges, of 15.85%.(2)
<TABLE>
<S> <C> <C>
- --------------------------------------
Avg Annual Total Returns
- --------------------------------------
For the Periods Ended 3/31/98(1)
Class A
1 year 5 year 10 year
- --------------------------------------
28.48% 13.61% 18.88%
- --------------------------------------
Class B
Since
1 year 5 year Inception
- --------------------------------------
30.79% N/A 22.63%
- --------------------------------------
Class C
Since
1 year 5 year Inception
- --------------------------------------
34.44% N/A 25.78%
- --------------------------------------
- --------------------------------------
Cumulative Total Return
- --------------------------------------
For the Period Ended 3/31/98(1)
Class A
5 year
- --------------------------------------
89.30% $18,929(3)
- --------------------------------------
</TABLE>
Growth of $10,000
Over five years
(without sales charges)(3)
|_| Oppenheimer Quest Capital Value Fund, Inc.
Class A shares
|_| S&P 500 Index
[PLOT POINTS FOR MOUNTAIN CHART]
(3/31/93 -- 3/31/98
<TABLE>
<S> <C>
10000 10000
10033 10049
10068 10308
9870 10547
9993 10147
10155 10190
9755 10688
10921 10687
12119 11727
13317 12847
13091 13868
14282 14702
14979 16492
14465 16187
15479 16687
14530 18078
16034 18563
18284 21804
17776 23437
19807 24110
19607 27473
</TABLE>
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 shares total returns reflect the historical performance of the
Class A shares of the Fund (formerly Capital shares) as adjusted for the fees
and expenses of Class A shares in effect as of 3/3/97 (without giving effect to
any fee waivers). Average annual total returns for Class A shares include the
current 5.75% maximum initial sales charge. Class B and C shares were first
offered for sale on 3/3/97. Class B returns include the applicable contingent
deferred sales charge of 5% (1-year) and 4% (since inception). Class C returns
include the applicable contingent deferred sales charge of 1%. Additional
information on charges and expenses is in the Fund's prospectus. Class B and C
shares are subject to an annual 0.75% asset-based sales charge and Class A
shares are subject to an annual 0.25% asset-based sales charge (the Fund's
distributor has voluntarily agreed to waive 0.15% of this fee until 2/28/99).
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.
4 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
Portfolio review
- --------------------------------------------------------------------------------
Oppenheimer Quest Capital Value Fund, Inc. is for investors looking for capital
appreciation.
What We Look For
[bullet] Good businesses identified through fundamental analysis.
[bullet] Management motivated to work for shareholders.
[bullet] Securities that can be purchased at a reasonable price.
[bullet] Companies with high return on capital vs. high growth.
[PIE CHART]
Asset Allocation(4)
<TABLE>
<S> <C>
|_| Equities 88.1%
|_| Cash equivalents 11.9
</TABLE>
Top 10 Stock Holdings(4)
............................................................
<TABLE>
<S> <C> <C> <C>
Allegiance Corp. 8.6% Canadian Pacific
Ltd. (New) 6.1%
............................................................
Tele-Communications TCI LucasVariety plc, ADR 5.9
Ventures Group, Cl. A 8.4
............................................................
WorldCom, Inc. 7.3 ACE Ltd. 5.1
............................................................
H&R Block, Inc. 7.3 Tricon Global
Restaurants, Inc. 4.9
............................................................
Countrywide Credit Triton Energy Ltd. 4.8
Industries, Inc. 6.6
............................................................
</TABLE>
Top 5 Industries(4)
<TABLE>
<S> <C>
............................................................
Insurance 14.3%
............................................................
Telecommunications-Technology 13.6
............................................................
Healthcare/Supplies & Services 8.6
............................................................
Telephone Utilities 7.3
............................................................
Industrial Services 7.3
............................................................
</TABLE>
3. Results of a hypothetical $10,000 investment in Class A shares on March 31,
1993. The S&P 500 Index is a broad-based unmanaged stock index including daily
reinvestment of dividends, and cannot be purchased directly by investors. Past
performance does not guarantee future results.
4. Portfolio is subject to change. Percentages are as of April 30, 1998 and are
based on total market value of investments.
5 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
How has the Fund performed during the past six months?
For the six-month period ended April 30, 1998, Oppenheimer Quest Capital Value
Fund, Inc. Class A shares produced a cumulative total return, without sales
charges, of 15.85%.(1)
What investments exceeded your expectations?
WorldCom, Inc., one of the world's premier telecommunications companies, has
seen continued success during the period. WorldCom is one of the only companies
that can provide a complete product mix, including local telephone,
long-distance and internet services. The company continues to grow rapidly,
partly through an aggressive acquisition strategy. Recently, it acquired a
major long-distance provider, MCI Communications, which we view as very
positive because the combined company is likely to achieve economies of scale
which improves shareholder value. WorldCom has also greatly expanded its local
telephone services to business customers throughout the United States and its
internet division is nearly doubling in revenues every year.
In financial services, H&R Block was a very good performer during the
period, benefiting from the ever-increasing complexity of the new tax laws. The
company's tax preparation business is one of the most profitable businesses in
the country. And while their traditional niche is the moderate income taxpayer,
the company has recently sought out upper income taxpayers by purchasing
accounting practices from local CPAs and by the establishment of H&R Block
"premium" offices which cater to higher income individuals and small
businesses.
[CAPTION]
"WorldCom, Inc., one of the world's premier telecommunications companies, has
seen continued success during the period."
[END CAPTION]
6 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
[Photo of Glinsman and Whittington] Portfolio Management Team (l to r)
Colin Glinsman
Jeff Whittington
(Portfolio Manager)
Two insurance companies in the portfolio, Mid Ocean Ltd. and EXEL Ltd.,
announced that they would merge, a move that was positive for both companies.
Mid Ocean and EXEL both sell a mixture of property and casualty insurance
coverage to Fortune 500 companies. Combining the operations should create cost
savings, an increased share of the market and will likely position the new
company to grow rapidly.
Were there any investments that didn't do so well?
Because of weak oil prices, Triton Energy Ltd. was a disappointment. The
company's two major projects are an oil field in Colombia and a gas project
near Malaysia. Recently, the company announced that they were "reviewing their
strategic alternatives," which could include selling all or part of their
Colombian operation, looking for a partner in their gas operation or selling
the entire company. We've owned the stock for a long time, and we like the
values in these projects. So, we are going to continue to hold the stock,
because we think that many of these scenarios would be positive.
1. 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.
7 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
What other factors affected your performance?
The Fund tends to invest in mid-sized companies, which, as a group, continued
to underperform the large company averages such as the S&P 500 and the Dow
Jones Industrial Average. In addition, we manage the portfolio by employing a
"value" style, emphasizing companies that are selling at a discount to what we
believe to be their fair value. For the past year, however, the value style
trailed the "growth" style of investing, in which investors pay a premium for
companies with earnings that are growing faster than the market as a whole.
Growth tends to outperform value in periods in which the overall market is
posting very strong returns. Another factor adversely affecting performance was
the Fund's relatively high cash position. Last year, the Oppenheimer Quest
Capital Value Fund, Inc. was converted from a closed-end fund to an open-end
fund. During the transition period, we held a significant amount of cash to
handle potential redemptions, and that surplus cash continued into this
reporting period. The returns on cash have been substantially lower than the
returns available in the stock market.
What is your outlook for the Fund?
We are long-term investors. We don't time the market or invest in the next
"hot" sector. Instead, we look for superior businesses with good management at
modest prices and build portfolios from the bottom up, one stock at a time. And
while we don't target specific industries or sectors, we attempt to limit the
number of stocks in the portfolio, so that we can gain more insight into each
individual holding.
[CAPTION]
"We believe that the stocks in the Fund are modestly priced compared to the Dow
or the S&P 500 . . . and therefore represent good value."
[END CAPTION]
8 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
Financials
- --------------------------------------------------------------------------------
9 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks--87.1%
- --------------------------------------------------------------------------------
Consumer Cyclicals--7.4%
- --------------------------------------------------------------------------------
Autos & Housing--2.6%
Dollar Thrifty Automotive Group, Inc.(1) 400,000 $ 7,550,000
- --------------------------------------------------------------------------------
Leisure & Entertainment--4.8%
Tricon Global Restaurants, Inc.(1) 450,000 14,287,500
- --------------------------------------------------------------------------------
Consumer Non-Cyclicals--10.5%
- --------------------------------------------------------------------------------
Food--2.0%
International Home Foods, Inc.(1) 200,000 6,000,000
- --------------------------------------------------------------------------------
Healthcare/Supplies & Services--8.5%
Allegiance Corp. 550,000 25,093,750
- --------------------------------------------------------------------------------
Energy--4.8%
- --------------------------------------------------------------------------------
Oil-Integrated--4.8%
Triton Energy Ltd.(1) 350,000 14,043,750
- --------------------------------------------------------------------------------
Financial--20.7%
- --------------------------------------------------------------------------------
Diversified Financial--6.5%
Countrywide Credit Industries, Inc. 398,300 19,267,763
- --------------------------------------------------------------------------------
Insurance--14.2%
ACE Ltd. 390,000 14,771,250
- --------------------------------------------------------------------------------
EXEL Ltd. 180,000 13,443,750
- --------------------------------------------------------------------------------
Mid Ocean Ltd. 180,000 13,567,500
-----------
41,782,500
Industrial--19.0%
- --------------------------------------------------------------------------------
Industrial Services--7.2%
H & R Block, Inc. 475,000 21,375,000
- --------------------------------------------------------------------------------
Manufacturing--5.8%
LucasVarity plc, ADR 380,000 17,100,000
- --------------------------------------------------------------------------------
Transportation--6.0%
Canadian Pacific Ltd. (New) 600,000 17,662,500
- --------------------------------------------------------------------------------
Technology--17.5%
- --------------------------------------------------------------------------------
Computer Hardware--4.0%
Adaptec, Inc.(1) 500,000 11,843,750
- --------------------------------------------------------------------------------
Telecommunications-Technology--13.5%
CommScope, Inc.(1) 600,000 9,750,000
- --------------------------------------------------------------------------------
General Instrument Corp.(1) 246,000 5,519,625
- --------------------------------------------------------------------------------
Tele-Communications TCI Ventures Group, Cl. A(1) 1,500,000 24,468,750
-----------
39,738,375
</TABLE>
10 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
<S> <C> <C>
Utilities--7.2%
- --------------------------------------------------------------------------------
Telephone Utilities--7.2%
WorldCom, Inc.(1) 500,000 $ 21,390,625
------------
Total Common Stocks (Cost $171,323,739) 257,135,513
</TABLE>
<TABLE>
<CAPTION>
Face
Amount
- --------------------------------------------------------------------------------
<S> <C> <C>
Short-Term Notes--11.7%(2)
- --------------------------------------------------------------------------------
Federal Farm Credit Bank, 5.36%, 5/12/98 $ 5,195,000 5,186,492
Federal Home Loan Bank, 5.43%, 5/1/98 13,839,000 13,839,000
Ford Motor Credit Co., 5.50%, 5/20/98 10,000,000 9,970,972
Goldman Sachs Group LP, 5.53%, 5/11/98 3,993,000 3,986,899
Merrill Lynch & Co., Inc., 5.53%, 5/4/98 1,600,000 1,599,263
----------
Total Short-Term Notes (Cost $34,582,626) 34,582,626
- --------------------------------------------------------------------------------
Total Investments, at Value (Cost $205,906,365) 98.8% 291,718,139
- --------------------------------------------------------------------------------
Other Assets Net of Liabilities 1.2 3,634,990
------------ -----------
Net Assets 100.0% $295,353,129
============ ============
</TABLE>
1. Non-income producing security.
2. 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.
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 April 30, 1998.
There were no affiliate securities held as of April 30, 1998. Transactions
during the period in which the issuer was an affiliate are as follows:
<TABLE>
<CAPTION>
Shares Gross Gross Shares
October 31, 1997 Additions Reductions April 30, 1998
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Trump Hotels & Casino Resorts, Inc. 1,200,000 -- 1,200,000 --
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Assets
Investments, at value (cost $205,906,365)--see accompanying statement $291,718,139
- --------------------------------------------------------------------------------------
Receivables:
Investments sold 6,472,726
Shares of capital stock sold 430,204
Interest and dividends 80,000
- --------------------------------------------------------------------------------------
Other 477,146
------------
Total assets 299,178,215
Liabilities
Bank overdraft 492,445
- --------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 1,931,000
Shares of capital stock redeemed 725,805
Redemption of income certificates 539,115
Distribution and service plan fees 60,837
Transfer and shareholder servicing agent fees 11,354
Other 64,530
------------
Total liabilities 3,825,086
- --------------------------------------------------------------------------------------
Net Assets $295,353,129
============
- --------------------------------------------------------------------------------------
Composition of Net Assets
Par value of shares of capital stock $ 899
- --------------------------------------------------------------------------------------
Additional paid-in capital 187,505,422
- --------------------------------------------------------------------------------------
Undistributed net investment income 213,880
- --------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 21,821,154
- --------------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 85,811,774
------------
Net assets $295,353,129
============
</TABLE>
12 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
- --------------------------------------------------------------------------------
<S> <C>
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$289,930,813 and 8,827,424 shares of capital stock outstanding) $ 32.84
Maximum offering price per share (net asset value plus sales charge of 5.75%
of offering price) $ 34.84
- -------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $3,915,488
and 120,312 shares of capital stock outstanding) $ 32.54
- -------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $1,506,828
and 46,270 shares of capital stock outstanding) $ 32.57
</TABLE>
See accompanying Notes to Financial Statements.
13 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Six Months Ended April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Investment Income
Dividends (net of foreign withholding taxes of $47,396) $ 1,285,972
- ----------------------------------------------------------------------------------
Interest 806,896
-----------
Total income 2,092,868
- ----------------------------------------------------------------------------------
Expenses
Management fees--Note 4 1,464,945
- ----------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 724,836
Class B 11,014
Class C 4,253
- ----------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 78,507
- ----------------------------------------------------------------------------------
Registration and filing fees:
Class A 59,570
Class B 1,294
Class C 429
- ----------------------------------------------------------------------------------
Shareholder reports 26,298
- ----------------------------------------------------------------------------------
Legal and auditing fees 13,028
- ----------------------------------------------------------------------------------
Directors' fees and expenses 10,570
- ----------------------------------------------------------------------------------
Custodian fees and expenses 1,681
- ----------------------------------------------------------------------------------
Other 26,538
-----------
Total expenses 2,422,963
Less reimbursement of expenses by OppenheimerFunds, Inc.--Note 4 (555,484)
-----------
Net expenses 1,867,479
- ----------------------------------------------------------------------------------
Net Investment Income 225,389
- ----------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments:
Unaffiliated companies 37,145,533
Affiliated companies (15,300,930)
-----------
Net realized gain 21,844,603
- ----------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 22,365,926
-----------
Net realized and unrealized gain 44,210,529
- ----------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $44,435,918
===========
</TABLE>
See accompanying Notes to Financial Statements.
14 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Period Ended
April 30, 1998 October 31,
(Unaudited) 1997(1)
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment income $ 225,389 $ 4,621,550
- -------------------------------------------------------------------------------------------------
Net realized gain 21,844,603 112,202,017
- -------------------------------------------------------------------------------------------------
Provision/reduction of income taxes on capital gains -- 101,806
- -------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 22,365,926 (81,440,121)
-------------- ------------
Net increase in net assets resulting from operations 44,435,918 35,485,252
- -------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders
Dividends from net investment income:
Class A (1,033,878) (1,463,750)
Class B (2,195) --
Class C (816) --
- -------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (111,344,042) --
Class B (438,269) --
Class C (247,999) --
- -------------------------------------------------------------------------------------------------
Capital Stock Transactions
Net increase (decrease) in net assets resulting from capital
stock transactions--Note 2:
Class A 15,010,959 (361,670,071)
Class B 2,814,181 1,137,545
Class C 850,526 743,541
Redemption of income shares -- (208,857,924)
- -------------------------------------------------------------------------------------------------
Net Assets
Total decrease (49,955,615) (534,625,407)
- -------------------------------------------------------------------------------------------------
Beginning of period 345,308,744 879,934,151
-------------- ------------
End of period (including undistributed net investment
income of $213,880 and $1,025,380, respectively) $ 295,353,129 $345,308,744
============== ============
</TABLE>
1. For the ten months ended October 31, 1997 for Class A shares and for the
period from March 3, 1997 (inception of offering) to October 31, 1997 for Class
B and Class C shares.
See accompanying Notes to Financial Statements.
15 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
-------------------------------------------------------------------
Six Months Period
Ended April 30, Ended
1998 October 31, Year Ended December 31,
(Unaudited) 1997(2) 1996 1995
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $41.63 $37.25 $33.65 $25.79
- ---------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .03 .44 -- --
Net realized and unrealized gain (loss) 5.03 3.93 6.91 9.46
Provision/reduction for corporate
income taxes on net realized
long-term capital gain -- .01 (3.31) (1.57)
Total income (loss) from investment
operations 5.06 4.38 3.60 7.89
- ---------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment
income ( .13) -- -- --
Distributions from net realized gain (13.72) -- -- --
Distributions from net realized
short-term gain -- -- -- (.03)
-------- -------- -------- --------
Total dividends and distributions
to shareholders (13.85) -- -- (.03)
- ---------------------------------------------------------------------------------------------------------------
Net asset value, end of period $32.84 $41.63 $37.25 $33.65
====== ====== ====== ======
Market value, end of period N/A N/A $36.13 $31.88
====== ====== ====== ======
- ---------------------------------------------------------------------------------------------------------------
Total Return, at Market Value(3) N/A N/A 23.63% 45.58%
- ---------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value(5) 15.85% 11.76% 20.46%(4) 36.68%(4)
- ---------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period
(in thousands) $289,931 $343,329 $879,934 $815,179
- ---------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $292,042 $434,401 $883,395 N/A
- ---------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 0.16%(6) 1.28%(6)(8) 2.82% 3.20%
Expenses, before voluntary assumption
by the Manager 1.65%(6) 1.54%(6)(8) 0.72%(7) 0.73%
Expenses, net of voluntary assumption
by the Manager 1.27%(6) 1.11%(6)(8) N/A N/A
- ---------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(9) 18.8% 33.8% 74% 72%
Average brokerage commission rate(10) $0.0547 $0.0570 $0.05 --
</TABLE>
16 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
Class B Class C
- ----------------------------------------------------------------------------------------------------------
Six Months Six Months
Ended April 30, Period Ended Ended April 30, Period Ended
1998 October 31, 1998 October 31,
1994 1993 (Unaudited) 1997(1) (Unaudited) 1997(1)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$27.09 $26.29 $41.41 $37.04 $41.42 $37.04
- ----------------------------------------------------------------------------------------------------------
-- -- (.08) .01 (.15) .01
(.38) 2.45 5.00 4.36 5.07 4.37
(.53) (1.43) -- -- -- --
- -------- -------- ------ ------ ------ ----
(.91) 1.02 4.92 4.37 4.92 4.38
- ----------------------------------------------------------------------------------------------------------
-- -- (.07) -- (.05) --
-- -- (13.72) -- (13.72) --
(.39) (.22) -- -- -- --
- -------- -------- ------ ------ ------ ----
(.39) (.22) (13.79) -- (13.77) --
- ----------------------------------------------------------------------------------------------------------
$25.79 $27.09 $32.54 $41.41 $32.57 $41.42
======== ======== ====== ====== ====== ====
$23.00 $23.75 N/A N/A N/A N/A
======== ======== ====== ====== ====== ====
- ----------------------------------------------------------------------------------------------------------
0.89% 10.50% N/A N/A N/A N/A
- ----------------------------------------------------------------------------------------------------------
(1.29)%(4) 9.34%(4) 15.49% 11.80% 15.47% 11.82%
- ----------------------------------------------------------------------------------------------------------
$673,742 $696,803 $3,915 $1,208 $1,507 $773
- ----------------------------------------------------------------------------------------------------------
N/A N/A $2,236 $552 $862 $372
- ----------------------------------------------------------------------------------------------------------
3.47% 3.29% (0.52)%(6) 0.07%(6) (0.54)%(6) 0.06%(6)
0.74% 0.74% 2.21%(6) 2.14%(6) 2.20%(6) 2.13%(6)
N/A N/A 1.98%(6) 1.86%(6) 1.97%(6) 1.85%(6)
- ----------------------------------------------------------------------------------------------------------
45% 51% 18.8% 33.8% 18.8% 33.8%
-- -- $0.0547 $0.0570 $0.0547 $0.0570
</TABLE>
17 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights (Unaudited) (Continued)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. For the period from March 3, 1997 (inception of offering of shares) to
October 31, 1997.
2. For the ten months ended October 31, 1997 for Class A shares (formerly
Capital Shares). On February 28, 1997, OppenheimerFunds, Inc. became the
investment advisor to the Fund and on March 3, 1997 the Fund was converted from
a closed-end fund to an open-end fund, and Capital Shares were redesignated as
Class A shares. The Fund changed its fiscal year end from December 31 to
October 31.
3. Change in market price assuming reinvestment of short-term capital gains
distributions, if any, at payable date and federal taxes paid on long-term
capital gains on year end (both at market).
4. Total returns of Class A shares (formerly, the Capital Shares) at net asset
value for periods prior to March 3, 1997, the date the Fund converted to an
open-end fund, are not audited and have not been restated to reflect the fees
and expenses (without giving effect to fee waivers) to which the Fund became
subject on March 3, 1997. Had such a restatement been made, total returns
(unaudited) at net asset value for each of the years ended December 31, 1996,
1995, 1994 and 1993 would have been 18.25%, 34.20%, (3.11)% and 7.32%,
respectively.
5. 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. Prior to
March 3, 1997, the Fund operated as a closed-end investment company and total
return was calculated based on market value.
6. Annualized.
7. The expense ratio reflects the effect of gross expenses paid indirectly by
the Fund.
8. Due to the change from the Fund's dual purpose structure and conversion from
a closed-end to an open-end fund, the ratios for Class A shares are not
necessarily comparable to those of prior periods.
9. 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 April 30, 1998 were $49,677,140 and $152,048,789,
respectively.
10. 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.
18 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Oppenheimer Quest Capital Value Fund, Inc. (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 to seek
capital appreciation. The Fund invests in securities (primarily equity
securities) of companies believed by management to be undervalued in the
marketplace in relation to factors such as the companies' assets, earnings,
growth potential and cash flows. The Fund's investment advisor is
OppenheimerFunds, Inc. (the Manager) and the Manager has entered into a
sub-advisory agreement with OpCap Advisors. The Fund offers Class A, Class B
and Class C 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. 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 Directors. 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 Directors 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.
- --------------------------------------------------------------------------------
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.
19 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. Significant Accounting Policies (continued)
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.
- --------------------------------------------------------------------------------
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. 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.
- --------------------------------------------------------------------------------
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. Interest income is accrued on a daily basis. 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.
20 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2. Capital Stock
The Fund has authorized one billion shares of $.0001 par value capital stock.
Transactions in shares of capital stock were as follows:
<TABLE>
<CAPTION>
Six Months Ended April 30, 1998 Period Ended October 31, 1997(1)
------------------------------- --------------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------------
Class A:
<S> <C> <C> <C> <C>
Sold 626,884 $ 18,981,596 487,331 $ 16,807,176
Dividends and distributions
reinvested 1,567,900 46,331,450 -- --
Redeemed (1,614,381) (50,302,087) (10,244,612) (378,477,247)
---------- ------------ ----------- -------------
Net increase (decrease) 580,403 $ 15,010,959 (9,757,281) $(361,670,071)
========== ============ =========== =============
- -------------------------------------------------------------------------------------------------
Class B:
Sold 145,356 $ 4,397,293 29,862 $ 1,164,926
Dividends and distributions
reinvested 13,702 402,297 -- --
Redeemed (67,909) (1,985,409) (699) (27,381)
---------- ------------ ----------- -------------
Net increase 91,149 $ 2,814,181 29,163 $ 1,137,545
========== ============ =========== =============
- -------------------------------------------------------------------------------------------------
Class C:
Sold 30,339 $ 960,185 22,769 $ 916,393
Dividends and distributions
reinvested 5,959 175,123 -- --
Redeemed (8,682) (284,782) (4,115) (172,852)
---------- ------------ ----------- -------------
Net increase 27,616 $ 850,526 18,654 $ 743,541
========== ============ =========== =============
</TABLE>
1. For the ten months ended October 31, 1997 for Class A shares and for the
period from March 3, 1997 (inception of offering) to October 31, 1997 for Class
B and Class C shares.
- --------------------------------------------------------------------------------
3. Unrealized Gains and Losses on Investments
At April 30, 1998, net unrealized appreciation on investments of $85,811,774
was composed of gross appreciation of $88,538,935, and gross depreciation of
$2,727,161.
21 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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 1.00% of the first
$400 million of average daily net assets, 0.90% of the next $400 million of
average daily net assets and 0.85% of average daily net assets over $800
million. Pursuant to the agreement, until February 28, 1999, the Manager will
waive the following portion of the advisory fee: 0.15% of the first $200
million of average daily net assets, 0.40% of the next $200 million, 0.30% of
the next $400 million and 0.25% of average daily net assets over $800 million.
For the six months ended April 30, 1998, the waiver amounted to $338,032.
The Manager pays OpCap Advisors (the Sub-Advisor) based on the
fee schedule set forth in the Prospectus. For the six months ended April 30,
1998, the Manager paid $450,435 to the Sub-Advisor.
For the six months ended April 30, 1998, commissions (sales
charges paid by investors) on sales of Class A shares totaled $165,850, of
which $52,678 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 $85,728 and $8,371, respectively, of
which $7,080 was paid to an affiliated broker/dealer for Class B shares. During
the six months ended April 30, 1998, OFDI received contingent deferred sales
charges of $3,314 upon redemption of Class B 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. The Fund pays OFS an annual maintenance fee of
$14.85 for each Fund shareholder account and reimburses OFS for its
out-of-pocket expenses. During the six months ended April 30, 1998, the Fund
paid OFS $79,787. Effective May 1, 1998, the Board of Directors approved an
increase in the annual maintenance fee from $14.85 to $18.00 for each Fund
shareholder account.
22 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund has adopted a Distribution and Service Plan for Class A shares to
compensate OFDI for a portion of its costs incurred in connection with the
personal service and maintenance of shareholder accounts that hold Class A
shares. Under the Plan, the Fund pays an annual asset-based sales charge to
OFDI of 0.25% per year on Class A shares. The Fund also pays a service fee to
OFDI of 0.25% per year. Both fees are computed on the average annual net assets
of Class A shares of the Fund, determined as of the close of each regular
business day. OFDI uses all of the service fee and the asset-based sales charge
to compensate brokers, dealers, banks and other financial institutions
quarterly for providing personal service and maintenance of accounts of their
customers that hold Class A shares. The Distributor has voluntarily agreed to
waive 0.15% of the distribution fee payable under the plan until February 28,
1999. For the six months ended April 30, 1998, the waiver amounted to $217,452.
The Fund has adopted Distribution and Service Plans for Class B and
Class C shares to compensate OFDI for its costs in distributing Class B and
Class C shares and servicing accounts. Under the Plans, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class B and Class C shares
for its services rendered in distributing Class B and 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 B and Class C shares. Each fee
is computed on the average annual net assets of Class B or Class C shares,
determined as of the close of each regular business day. During the six months
ended April 30, 1998, OFDI retained $10,497 and $3,646, respectively, as
compensation for Class B and Class C sales commissions and service fee
advances, as well as financing costs. If either Plan is terminated by the Fund,
the Board of Directors may allow the Fund to continue payments of the
asset-based sales charge to OFDI for distributing shares before the Plan was
terminated. At April 30, 1998, OFDI had incurred excess distribution and
servicing costs of $120,255 for Class B and $13,616 for Class C.
23 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
5. 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 30 days 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 April 30, 1998.
24 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Oppenheimer Quest Capital Value Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Officers and Directors Bridget A. Macaskill, Chairman of the Board of
Directors and President
Paul Y. Clinton, Director
Thomas W. Courtney, Director
Lacy B. Herrmann, Director
George Loft, Director
Robert C. Doll, Jr., 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.
- --------------------------------------------------------------------------------
Sub-Advisor OpCap Advisors
- --------------------------------------------------------------------------------
Distributor OppenheimerFunds Distributor, Inc.
- --------------------------------------------------------------------------------
Transfer and Shareholder OppenheimerFunds Services
Servicing Agent
- --------------------------------------------------------------------------------
Custodian of Portfolio State Street Bank and Trust Company
Securities
- --------------------------------------------------------------------------------
Independent Accountants Price Waterhouse LLP
- --------------------------------------------------------------------------------
Legal Counsel Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have been
taken from the records of the Fund without examination
by the independent accountants.
This is a copy of a report to shareholders of
Oppenheimer Quest Capital Value Fund, Inc. This report
must be preceded or accompanied by a Prospectus of
Oppenheimer Quest Capital Value Fund, Inc. 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.
25 OppeSnheimer Quest Capital Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
OppenheimerFunds Family
- --------------------------------------------------------------------------------
<TABLE>
- ---------------------------------------------------------------------------------------
Real Asset Funds
- ---------------------------------------------------------------------------------------
<S> <C> <C>
Real Asset Fund Gold & Special Minerals Fund
- ---------------------------------------------------------------------------------------
Global Stock Funds
- ---------------------------------------------------------------------------------------
Developing Markets Fund International Growth Fund Quest Global Value Fund
International Small Global Fund Global Growth & Income Fund
Company Fund
- ---------------------------------------------------------------------------------------
Stock Funds
- ---------------------------------------------------------------------------------------
Enterprise Fund MidCap Fund Growth Fund
Discovery Fund Capital Appreciation Fund Disciplined Value Fund
Quest Small Cap Value Fund Quest Capital Value Fund Quest Value Fund
- ---------------------------------------------------------------------------------------
Stock & Bond Funds
- ---------------------------------------------------------------------------------------
Main Street Income & Total Return Fund Disciplined Allocation Fund
Growth Fund Quest Balanced Multiple Strategies Fund
Quest Opportunity Value Fund1 Convertible Securities Fund(2)
Value Fund Equity Income Fund
- ---------------------------------------------------------------------------------------
Taxable Bond Funds
- ---------------------------------------------------------------------------------------
International Bond Fund Champion Income Fund U.S. Government Trust
World Bond Fund Strategic Income Fund Limited-Term Government Fund
High Yield Fund Bond Fund
- ---------------------------------------------------------------------------------------
Municipal Bond Funds
- ---------------------------------------------------------------------------------------
California Municipal Fund(3) Pennsylvania Municipal Fund3 Rochester Division:
Florida Municipal Fund(3) Municipal Bond Fund Rochester Fund Municipals
New Jersey Municipal Fund(3) Insured Municipal Fund Limited Term New York
New York Municipal Fund(3) Intermediate Municipal Fund Municipal Fund
- ---------------------------------------------------------------------------------------
Money Market Funds(4)
- ---------------------------------------------------------------------------------------
Money Market Fund Cash Reserves
</TABLE>
1. On 5/18/98, the Fund's name was changed from "Quest Growth & Income Value
Fund."
2. On 4/28/98, the Fund's name was changed from "Bond Fund for Growth."
3. Available only to investors in certain states.
4. An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency. Although
these funds seek to preserve the value of your investment at $1.00 per share,
it is possible to lose money by investing in these funds.
Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203.
(C) Copyright 1998 OppenheimerFunds, Inc. All rights reserved.
26 Oppenheimer Quest Capital Value Fund, Inc.
<PAGE>
<PAGE>
Information and services
- --------------------------------------------------------------------------------
Internet As an Oppenheimer fund shareholder, you have some
24-hr access to account special privileges. Whether it's automatic
information. Online investment plans, informative newsletters and
transactions now available hotlines, or ready account access, you can benefit
- --------------------------- from services designed to make investing simple.
www.oppenheimerfunds.com 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
General Information can reach them at our General Information number.
Mon-Fri 8:30am-9pm ET When you want to make a transaction, you can
Sat 10am-4pm ET do it easily by calling our toll-free Telephone
- --------------------------- Transactions number or by visiting our website.
1-800-525-7048 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
Account Transactions number or website to make investments.
Mon-Fri 8:30am-8pm ET For added convenience, you can get automated
- --------------------------- information with OppenheimerFunds PhoneLink
1-800-852-8457 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
PhoneLink Representative during the General Information
24-hr automated information hours shown at the left.
and automated transactions You can count on us whenever you need assis-
- --------------------------- tance. That's why the International Customer
1-800-533-3310 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
Telecommunication Device agent, OppenheimerFunds Services, with their Award
for the Deaf (TDD) of Excellence in 1993.
Mon-Fri 8:30am-2pm ET So call us today, or visit us at our website
- --------------------------- at www.oppenheimerfunds.com--we're here to help.
1-800-843-4461
- ---------------------------
OppenheimerFunds
Information Hotline
24 hours a day, timely and
insightful messages on the
economy and issues that
affect your investments
- ---------------------------
1-800-835-3104
- ---------------------------
[OPPENHEIMERFUNDS LOGO]
Distributor, Inc.
RS0835.001.0498 June 29, 1998
