<PAGE>
Portfolio of Investments as of PRUDENTIAL GLOBAL NATURAL
May 31, 1995 RESOURCES FUND, INC.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Description Value
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
LONG-TERM INVESTMENTS--99.3%
COMMON STOCKS--92.1%
------------------------------------------------------------
Australia--7.6%
475,000 Acacia Resources* (Gold) $ 836,093
508,300 Alcan of Australia, Ltd.
(Non-Ferrous Metals) 993,309
52,280 Broken Hill Proprietary Co., Ltd.
(Energy Sources) 663,317
204,500 Comalco, Ltd. (Non-Ferrous Metals) 758,120
78,900 CRA, Ltd. (Metals) 1,052,083
237,500 Delta Gold, Ltd.* (Gold) 402,690
522,500 Gold Mines of Kalgoorlie, Ltd.
(Gold) 454,221
266,000 Highland Gold, Ltd. (Gold) 187,285
180,500 Homestake Gold, Ltd.* (Gold) 191,926
380,000 M.I.M. Holdings, Ltd. (Non-Ferrous
Metals) 491,418
158,200 Placer Pacific, Ltd. (Gold) 355,751
136,800 Plutonic Resources, Ltd. (Gold) 594,616
134,364 Western Mining Corp. Holdings, Ltd.
(Non-Ferrous Metals) 715,313
------------
7,696,142
- ------------------------------------------------------------
Canada--31.8%
156,800 Agnico Eagle Mines, Ltd. (Gold) 2,044,571
38,000 Agrium, Inc. (Materials) 1,067,221
97,400 Anderson Exploration, Ltd.*
(Exploration & Production) 1,092,406
120,000 Archer Resources, Ltd.* (Exploration
& Production) 481,453
143,500 Atcor Resources, Ltd.* (Energy
Sources) 350,677
49,700 Barrick Gold (Gold) 1,250,793
343,900 Beau Canada Exploration, Ltd.*
(Exploration & Production) 466,611
61,800 Blue Range Resource Corp.* (Energy
Sources) 467,721
77,900 Cabre Exploration, Ltd.*
(Exploration & Production) 809,771
78,100 Cameco Corp. (Non-Ferrous Metals) 2,392,822
65,600 Canadian Natural Resources, Ltd.*
(Exploration & Production) 825,473
451,300 Chancellor Energy Resources, Inc.*
(Exploration & Production) $ 549,784
38,000 Cominco Fertilizers, Ltd.*
(Chemicals) 669,750
79,000 Crestar Energy, Inc.* (Exploration &
Production) 756,374
91,200 Discovery West Corp.* (Exploration &
Production) 249,480
94,100 Dorset Exploration, Ltd.*
(Exploration & Production) 489,085
143,900 Elan Energy Corp.* (Exploration &
Production) 1,141,564
47,500 Ensign Resource Service Group,
Inc.*(Exploration & Production) 171,518
86,500 Grad & Walker Energy Corp.*
(Exploration & Production) 425,922
85,500 Jordan Petroleum, Ltd.* (Exploration
& Production) 549,636
134,000 Morrison Petroleum, Ltd.
(Exploration & Production) 1,014,152
114,000 Northrock Resources, Ltd.*
(Exploration & Production) 727,651
66,500 Northstar Energy Corp.* (Exploration
& Production) 563,929
87,000 Pacific Forest Products, Ltd.*
(Forest Products) 983,696
28,500 Paramount Resources, Ltd.
(Exploration & Production) 317,048
39,000 Pinnacle Resources, Ltd.*
(Exploration & Production) 455,192
64,700 Placer Dome, Inc. (Gold) 1,634,196
74,800 Potash Corp. of Saskatchewan, Inc.
(Chemicals) 3,560,346
71,300 Prime Resources Group, Inc.* (Gold) 487,608
86,900 Rigel Energy Corp.* (Exploration &
Production) 855,783
218,500 Rio Alto Exploration, Ltd.*
(Exploration & Production) 781,012
58,900 Talisman Energy, Inc.* (Exploration
& Production) 1,186,937
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 3 -----
<PAGE>
<PAGE>
Portfolio of Investments as of PRUDENTIAL GLOBAL NATURAL
May 31, 1995 RESOURCES FUND, INC.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Description Value
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
Canada (cont'd.)
112,200 Timberwest Forest, Ltd.*(Forest
Products) $ 1,084,473
242,300 TVX Gold, Inc.* (Gold) 1,855,892
63,500 Veritas Energy Services, Inc.* (Oil
Services) 376,363
------------
32,136,910
- ------------------------------------------------------------
France--4.6%
70,300 Coflexip (ADR) (Oil Services) 2,029,913
25,778 Societe Nationale Elf Aquitaine
(Energy Sources) 2,082,389
9,300 Total France Petroleum, Ltd. (Energy
Sources) 576,285
------------
4,688,587
- ------------------------------------------------------------
New Zealand--2.4%
192,874 Fernz Corp. (Chemicals) 730,705
962,000 Fletcher Challenge, Ltd. (Forest
Products) 1,310,757
19,500 New Zealand Refining Co., Ltd.
(Integrated Oil) 340,218
------------
2,381,680
- ------------------------------------------------------------
United States--45.7%
8,400 Amerada Hess Corp. (Integrated Oil) 426,300
38,000 Anadarko Petroleum Corp.
(Exploration & Production) 1,648,250
50,000 Arethusa Offshore, Ltd.* (Oil
Services) 800,000
147,300 Asia Pacific Resource International*
(Forest Products) 1,123,162
30,400 Baker Hughes, Inc. (Oil Services) 684,000
14,300 Battle Mountain Gold Co. (Gold) 146,575
27,600 Cabot Oil & Gas Corp. (Exploration &
Production) 434,700
44,600 Camco, Inc. (Oil Services) 986,775
59,900 Cross Timbers Oil Co. (Exploration &
Production) 943,425
24,700 Dreco Energy Services, Ltd.* (Oil
Services) 336,538
57,000 Ensco International, Inc.* (Oil
Services) 947,625
30,400 Enterra Corp.* (Oil Services) 581,400
35,500 Freeport-McMoran Copper & Gold, Inc.
(Non-Ferrous Metals) $ 727,750
78,900 Global Marine, Inc.* (Oil Services) 424,088
64,400 Hornbeck Offshore Services, Inc.*
(Oil Services) 1,006,250
81,900 ICO, Inc.* (Energy/Oil Services) 440,213
27,700 IMC Fertilizer Group, Inc.
(Chemicals) 1,246,500
80,000 J. Ray McDermott* (Oil &
Gas-Domestic) 2,121,000
333,800 Marine Drilling Cos., Inc.* (Oil
Services) 1,335,200
160,900 Mesa, Inc.* (Exploration &
Production) 844,725
62,700 Newfield Exploration Co.*
(Exploration & Production) 1,708,575
45,158 Newmont Mining Corp. (Gold) 1,885,346
208,394 NGC Corp. (Gas Pipelines) 1,823,447
90,900 Noble Affiliates, Inc. (Exploration
& Production) 2,465,662
45,750 Noble Drilling Corp.* (Exploration &
Production) 340,266
26,300 Offshore Logistics, Inc.* (Oil
Services) 378,063
24,900 Oryx Energy Co.* (Exploration &
Production) 357,938
47,400 Pegasus Gold, Inc.* (Gold) 562,875
147,300 Pride Petroleum Services, Inc.* (Oil
Services) 1,159,987
65,700 Rayonier Timberlands, L.P. (Forest
Products) 2,258,437
103,600 Reading & Bates Corp.* (Oil
Services) 906,500
177,900 Santa Fe Pacific Gold Corp. (Gold) 2,223,750
20,000 Seagull Energy Corp.* (Exploration &
Production) 387,500
45,500 Sonat Offshore Drilling, Inc. (Oil
Services) 1,296,750
92,200 Stillwater Mining Company*
(Non-Ferrous Metals) 2,068,737
77,900 Stolt Comex Seaway* (Oil Services) 681,625
27,750 Tejas Gas Corp.* (Gas Pipelines) 1,481,156
52,500 USX Delhi Group (Gas Pipelines) 649,688
24,700 USX Marathon Corp. (Integrated Oil) 490,913
56,000 Varco International, Inc.* (Oil
Services) 504,000
</TABLE>
- --------------------------------------------------------------------------------
- ----- 4 See Notes to Financial Statements.
<PAGE>
Portfolio of Investments as of PRUDENTIAL GLOBAL NATURAL
May 31, 1995 RESOURCES FUND, INC.
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Description Value (Note 1)
<C> <S> <C>
------------------------------------------------------------
United States (cont'd.)
43,800 Vigoro Corp. (Chemicals) $ 1,708,200
33,800 Western Atlas, Inc.* (Oil Services) 1,525,225
110,300 Western Gas Resources, Inc. (Gas
Pipelines) 2,150,850
------------
46,219,966
------------
Total common stocks
(cost US$80,631,722) 93,123,285
------------
PREFERRED STOCKS--4.3%
- ------------------------------------------------------------
United States--4.3%
19,000 AMAX Gold, Inc., Ser. B, 7.50%,
Convertible (Gold) 897,750
7,600 Battle Mountain Gold Co., Ser. B,
$3.25, Convertible (Gold) 421,800
23,800 Freeport-McMoran Copper & Gold,
Inc., $0.025 (Non-Ferrous Metals) 467,075
20,000 Hecla Mining Co., 7.00%,
Convertible, Ser. B (Gold) 1,002,500
48,500 Noble Drilling Corp. $1.50,
Convertible (Oil Services) 1,145,812
13,300 Reading & Bates Corp. $1.625,
Convertible (Oil Services) 372,400
------------
Total preferred stocks
(cost US$4,330,785) 4,307,337
------------
Warrants
WARRANTS*--0.6%
- ------------------------------------------------------------
United States--0.6%
600 Golden Shamrock Mines, Ltd. expiring
Sep. '99 @ USD7.50 (Gold)
(cost US$600,000) 600,000
------------
<CAPTION>
Principal
Amount
(000) Description Value (Note 1)
<C> <S> <C>
CONVERTIBLE BONDS--2.3%
- ------------------------------------------------------------
New Zealand--0.9%
NZ$ 760 Natural Gas Corp. Hldgs., 10.50%,
10/14/97 (Gas Pipelines) $ 894,088
- ------------------------------------------------------------
United States--1.4%
USD 250 Coeur Dalene Mines Corp., 7.00%,
11/30/02, Convertible 317,470
1,181 6.375%, 1/31/04, Sr. Sub. Deb.
(Gold) 1,107,187
------------
1,424,657
------------
Total convertible bonds
(cost US$2,171,800) 2,318,745
------------
Total long-term investments
(cost US$87,734,307) 100,349,367
------------
SHORT-TERM INVESTMENTS--1.5%
- ------------------------------------------------------------
Repurchase Agreement--1.5%
USD1,516 Joint Repurchase Agreement Account,
6.14%, 6/1/95,
(cost US$1,516,000; Note 5) 1,516,000
------------
- ------------------------------------------------------------
Total Investments--100.8%
(cost US$89,250,307; Note 4) 101,865,367
Liabilities in excess of other
assets--(0.8%) (803,862)
------------
Net Assets--100% $101,061,505
------------
------------
</TABLE>
- ---------------
* Non-income producing security.
ADR--American Depository Receipt.
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 5 -----
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Statement of Assets and Liabilities RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ASSETS May 31, 1995
Investments, at value (cost $89,250,307).................................................................... $ 101,865,367
Foreign currency, at value (cost $778,238).................................................................. 773,881
Cash........................................................................................................ 3,027
Receivable for Fund shares sold............................................................................. 402,850
Dividends and interest receivable........................................................................... 128,162
Other assets................................................................................................ 2,794
--------------
Total assets............................................................................................. 103,176,081
--------------
Liabilities
Payable for investments purchased........................................................................... 1,523,198
Payable for Fund shares reacquired.......................................................................... 385,727
Due to Distributors......................................................................................... 73,979
Due to Manager.............................................................................................. 65,088
Accrued expenses and other liabilities...................................................................... 64,822
Withholding taxes payable................................................................................... 1,762
--------------
Total liabilities........................................................................................ 2,114,576
--------------
Net Assets.................................................................................................. $ 101,061,505
--------------
Net assets were comprised of:
Common stock, at par..................................................................................... $ 75,280
Paid-in capital in excess of par......................................................................... 85,819,228
--------------
85,894,508
Accumulated net investment loss.......................................................................... (52,359)
Accumulated net realized gains on investments and foreign currency transactions.......................... 2,605,711
Net unrealized appreciation on investments and foreign currencies........................................ 12,613,645
--------------
Net assets, May 31, 1995.................................................................................... $ 101,061,505
--------------
--------------
Class A:
Net asset value and redemption price per share
($19,682,011 / 1,433,113 shares of common stock issued and outstanding)............................... $13.73
Maximum sales charge (5% of offering price).............................................................. .72
Maximum offering price to public......................................................................... $14.45
Class B:
Net asset value, offering price and redemption price per share
($80,773,845 / 6,049,516 shares of common stock issued and outstanding)............................... $13.35
Class C:
Net asset value, offering price and redemption price per share
($605,649 / 45,359 shares of common stock issued and outstanding)..................................... $13.35
</TABLE>
- --------------------------------------------------------------------------------
- ----- 6 See Notes to Financial Statements.
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL PRUDENTIAL GLOBAL NATURAL
RESOURCES FUND, INC. RESOURCES FUND, INC.
Statement of Operations Statement of Changes in Net Assets
- ------------------------------------------------------------
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended
Net Investment Loss May 31, 1995
<S> <C>
Income
Dividends (net of foreign withholding taxes
of $36,871).............................. $ 939,802
Interest.................................... 289,353
------------
Total income............................... 1,229,155
------------
Expenses
Distribution fee--Class A................... 26,978
Distribution fee--Class B................... 746,813
Distribution fee--Class C................... 2,429
Management fee.............................. 642,865
Transfer agent's fees and expenses.......... 140,000
Custodian's fees and expenses............... 136,000
Reports to shareholders..................... 103,000
Registration fees........................... 81,000
Legal fees.................................. 65,000
Audit fees and expenses..................... 53,000
Directors' fees............................. 37,500
Miscellaneous............................... 11,554
------------
Total expenses........................... 2,046,139
------------
Net investment loss............................ (816,984)
------------
Realized and Unrealized Gain (Loss)
on Investments and Foreign
Currency Transactions
Net realized gain on:
Investment transactions..................... 4,732,727
Foreign currency transactions............... 44,620
------------
4,777,347
------------
Net change in unrealized appreciation/
depreciation on:
Investment transactions..................... 4,166,580
Foreign currency............................ (5,690)
------------
4,160,890
------------
Net gain on investments and foreign
currencies.................................. 8,938,237
------------
Net Increase in Net Assets
Resulting from Operations...................... $ 8,121,253
------------
------------
</TABLE>
<TABLE>
<CAPTION>
Year Ended May 31,
Increase in Net Assets 1995 1994
<S> <C> <C>
Operations
Net investment loss............ $ (816,984) $ (322,515)
Net realized gain on investment
and foreign currency
transactions................ 4,777,347 896,441
Net change in unrealized
appreciation/depreciation on
investments and foreign
currencies.................. 4,160,890 1,063,092
------------ ------------
Net increase in net assets
resulting from operations... 8,121,253 1,637,018
------------ ------------
Net equalization credits.......... 66,525 645
------------ ------------
Fund share transactions (net of
share conversions) (Note 6)
Proceeds from shares sold...... 67,667,069 69,044,435
Cost of shares reacquired...... (45,533,815) (37,990,053)
------------ ------------
Net increase in net assets from
Fund share transactions..... 22,133,254 31,054,382
------------ ------------
Total increase.................... 30,321,032 32,692,045
Net Assets
Beginning of year................. 70,740,473 38,048,428
------------ ------------
End of year....................... $101,061,505 $ 70,740,473
------------ ------------
------------ ------------
</TABLE>
- --------------------------------------------------------------------------------
See Notes to Financial Statements. 7 -----
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Notes to Financial Statements RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
Prudential Global Natural Resources Fund, Inc., (the ``Fund''), is registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Fund's investment objective is long-term growth of
capital which it seeks to achieve by investing primarily in equity securities of
foreign and domestic natural resource companies.
- ------------------------------------------------------------
Note 1. Accounting Policies
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.
Security Valuation: Securities traded on an exchange are valued at the last
reported sales price on the primary exchange on which they are traded.
Securities traded in the over-the-counter market (including securities listed on
exchanges for which a last sales price is not available) are valued at the
average of the last reported bid and asked prices. Securities for which market
quotations are not readily available, including restricted securities, will be
valued at fair value as determined in good faith according to a pricing
procedure developed by the Investment Adviser under procedures established by
and under the general supervision of the Fund's Board of Directors. Options
listed on exchanges are valued at their closing price on the applicable
exchange.
Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost which approximates market value.
In connection with transactions in repurchase agreements with U.S. financial
institutions, it is the Fund's policy that its custodian or designated
subcustodians, as the case may be under triparty repurchase agreements, take
possession of the underlying collateral securities, the value of which exceeds
the principal amount of the repurchase transaction including accrued interest.
If the seller defaults, and the value of the collateral declines or if
bankruptcy proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
Foreign Currency Translation: The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities--at the
daily closing rates of exchange.
(ii) purchases and sales of investment securities, income and expenses--at the
rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented using the foreign exchange
rates and market values at the close of the fiscal year, the Fund does not
isolate that portion of the results of operations arising as a result of changes
in the foreign exchange rates from the fluctuations arising from changes in the
market prices of securities held at the fiscal year end. Similarly, the Fund
does not isolate the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of long-term portfolio
securities sold during the fiscal year.
Net realized gains on foreign currency transactions of $44,620 represents net
foreign exchange gains or losses from disposition of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
security transactions, and the difference between the amounts of dividends,
interest and foreign taxes recorded on the Fund's books and the U.S. dollar
equivalent amounts actually received or paid. Net unrealized currency gains and
losses from valuing foreign currency denominated assets and liabilities (other
than investments) at fiscal year end exchange rates are reflected as a component
of net unrealized appreciation on foreign currencies.
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of domestic origin as a result of,
among other factors, the possibility of political and economic instability and
the level of governmental supervision and the regulation of foreign securities
markets.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains and losses from investment and
currency transactions are calculated on the identified cost basis. Dividend
income is recorded on the ex-dividend date and interest income is recorded on an
accrual basis.
Net investment income (other than distribution fees) and unrealized and realized
gains or losses are allocated daily to each class of shares of the Fund based
upon the relative proportion of net assets of each class at the beginning of the
day.
Equalization: The Fund follows the accounting practice known as equalization by
which a portion of the proceeds from sales and costs of reacquisitions of Fund
shares, equivalent on a per share basis to the amount of distributable net
investment income on the date of the transaction, is credited or charged to
undistributed net investment income. As a result,
- --------------------------------------------------------------------------------
- ----- 8
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Notes to Financial Statements RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
undistributed net investment income per share is unaffected by sales or
reacquisitions of the Fund's shares.
Taxes: It is the Fund's policy to continue to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders. Therefore, no federal
income tax provision is required.
Withholding taxes on foreign interest, dividends and (realized and unrealized)
capital gains have been provided for in accordance with the Fund's understanding
of the applicable country's tax rules and rates. In addition, certain countries
impose taxes on capital gains realized on the sale of portfolio securities, and
as such, taxes have been accrued on the unrealized gains of such securities.
Reclassification of Capital Accounts: The Fund accounts and reports for
distributions to shareholders in accordance with the American Institute of
Certified Public Accountants Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income; Capital Gain, and
Return of Capital Distributions by Investment Companies. The effect of applying
this statement was to decrease paid-in capital in excess of par by $797,642,
decrease accumulated net investment loss by $842,262, and decreased accumulated
net realized gain on investments by $44,620 for the fiscal year ended May 31,
1995. Net realized gains and net assets were not affected by this change.
Dividends and Distributions: The Fund expects to pay dividends out of net
investment income and make distributions of any net capital gains, at least
annually, if any. Dividends and distributions are recorded on the ex-dividend
date.
Income distributions and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
foreign currencies and passive investment companies' transactions.
- ------------------------------------------------------------
Note 2. Agreements
The Fund has a management agreement with Prudential Mutual Fund Management, Inc.
(``PMF''). Pursuant to this agreement, PMF has responsibility for all investment
advisory services and supervises the subadviser's performance of such services.
PMF has entered into a subadvisory agreement with The Prudential Investment
Corporation (``PIC''); PIC furnishes investment advisory services in connection
with the management of the Fund. PMF pays for the cost of the subadviser's
services, the compensation of officers of the Fund, occupancy and certain
clerical and bookkeeping costs of the Fund. The Fund bears all other costs and
expenses.
The management fee paid PMF is computed daily and payable monthly, at an annual
rate of .75 of 1% of the Fund's average daily net assets.
The Fund has distribution agreements with Prudential Mutual Fund Distributors,
Inc. (``PMFD''), which acts as the distributor of the Class A shares of the
Fund, and with Prudential Securities Incorporated (``PSI''), which acts as
distributor of the Class B and Class C shares of the Fund (collectively the
``Distributors''). The Fund compensates the Distributors for distributing and
servicing the Fund's Class A, Class B and Class C shares, pursuant to plans of
distribution, (the ``Class A, B and C Plans'') regardless of expenses actually
incurred by them. The distribution fees are accrued daily and payable monthly.
On July 19, 1994, shareholders of the Fund approved amendments to the Class A
and Class B Plans under which the distribution plans became compensation plans,
effective August 1, 1994. Prior thereto, the distribution plans were
reimbursement plans, under which PMFD and PSI were reimbursed for expenses
actually incurred by them up to the amount permitted under the Class A and Class
B Plans, respectively. The Fund is not obligated to pay any prior or future
excess distribution costs (costs incurred by the Distributors in excess of
distribution fees paid by the Fund or contingent deferred sales charges received
by the Distributors). The rate of the distribution fees charged to Class A and
Class B shares of the Fund did not change under the amended plans of
distribution. The Fund began offering Class C shares on August 1, 1994.
Pursuant to the Class A, B and C Plans, the Fund compensates the Distributors
for distribution-related activities at an annual rate of up to .30 of 1%, 1% and
1%, of the average daily net assets of the Class A, B and Class C shares,
respectively. Such expenses under the Plans were .25 of 1%, 1% and 1% of the
average daily net assets of the Class A, B and C shares, respectively, for the
year ended May 31, 1995.
PMFD has advised the Fund that it has received approximately $71,400 in
front-end sales charges resulting from sales of Class A shares during the year
ended May 31, 1995. From these fees, PMFD paid such sales charges to dealers
(PSI and Prusec) which in turn paid commissions to salespersons.
- --------------------------------------------------------------------------------
9 -----
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Notes to Financial Statements RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
PSI advised the Fund that for the year ended May 31, 1995, it received
approximately $270,500 in contingent deferred sales charges imposed upon certain
redemptions by Class B and C shareholders.
PMFD is a wholly-owned subsidiary of PMF; PSI, PIC and PMF are indirect,
wholly-owned subsidiaries of The Prudential Insurance Company of America.
- ------------------------------------------------------------
Note 3. Other Transactions With Affiliates
Prudential Mutual Fund Services, Inc. (``PMFS''), a wholly-owned subsidiary of
PMF, serves as the Fund's transfer agent and during the year ended May 31, 1995,
the Fund incurred fees of approximately $135,100 for the services of PMFS. As of
May 31, 1995, approximately $12,500 of such fees were due to PMFS. Transfer
agent fees and expenses in the Statement of Operations include certain-out-of
pocket expenses paid to non-affiliates.
For the year ended May 31, 1995, PSI and/or its foreign affiliates earned
approximately $1,300 in brokerage commissions from portfolio transactions
executed on behalf of the Fund.
- ------------------------------------------------------------
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments
for the year ended May 31, 1995 aggregated $52,595,759 and $30,356,506,
respectively.
The federal income tax basis of the Fund's investments at May 31, 1995 was
$89,262,781 and accordingly, net unrealized appreciation for federal income tax
purposes was $12,602,586 (gross unrealized appreciation--$16,587,703; gross
unrealized depreciation--$3,985,117).
The Fund utilized its capital loss carryforward of approximately $2,054,000 to
offset the Fund's net taxable gains realized and recognized in the year ended
May 31, 1995.
- ------------------------------------------------------------
Note 5. Joint Repurchase Agreement Account
The Fund along with other affiliated registered investment companies, transfers
uninvested cash balances into a single joint account, the daily aggregate
balance of which is invested in one or more repurchase agreements collateralized
by U.S. Treasury or federal agency obligations. At May 31, 1995, the Fund had a
.16% undivided interest in the repurchase agreements in the joint account. The
undivided interest for the Fund represented $1,516,000 in principal amount. As
of such date, each repurchase agreement in the joint account and the value of
the collateral therefor were as follows:
Goldman, Sachs & Co., 6.14%, in the principal amount of $310,000,000, repurchase
price $310,052,872, due 6/1/95. The value of the collateral including accrued
interest is $316,254,589.
Bear, Stearns & Co., 6.125%, in the principal amount of $280,000,000, repurchase
price $280,047,639, due 6/1/95. The value of the collateral including accrued
interest is $285,803,012.
CS First Boston Corporation, 6.14%, in the principal amount of $280,000,000,
repurchase price $280,047,756, due 6/1/95. The value of the collateral including
accrued interest is $285,702,358.
UBS Securities Inc., 6.15%, in the principal amount of $100,000,000, repurchase
price $100,017,083, due 6/1/95. The value of the collateral including accrued
interest is $102,000,930.
- ------------------------------------------------------------
Note 6. Capital
The Fund offers Class A, Class B and Class C shares. Class A shares are sold
with a front-end sales charge of up to 5%. Class B shares are sold with a
contingent deferred sales charge which declines from 5% to zero depending on the
period of time the shares are held. Class C shares are sold with a contingent
deferred sales charge of 1% during the first year. Class B shares will
automatically convert to Class A shares on a quarterly basis approximately seven
years after purchase commencing in February 1995.
The Fund has authorized 500 million shares of common stock $.01 par value per
share equally divided into three classes, designated Class A, Class B and Class
C common stock.
Transactions in shares of common stock were as follows:
<TABLE>
<CAPTION>
Class A Shares Amount
- ----------------------------------- ---------- ------------
<S> <C> <C>
Year ended May 31, 1995:
Shares sold........................ 1,088,557 $ 13,699,912
Shares reacquired.................. (1,076,421) (13,660,360)
---------- ------------
Net increase in shares outstanding
before conversion................ 12,136 39,552
Shares issued upon conversion from
Class B.......................... 902,501 10,461,391
---------- ------------
Net increase in shares
outstanding...................... 914,637 $ 10,500,943
---------- ------------
---------- ------------
Year ended May 31, 1994:
Shares sold........................ 1,369,919 $ 17,150,765
Shares reacquired.................. (1,011,738) (12,620,595)
---------- ------------
Net increase in shares
outstanding...................... 358,181 $ 4,530,170
---------- ------------
---------- ------------
</TABLE>
- --------------------------------------------------------------------------------
- ----- 10
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Notes to Financial Statements RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B Shares Amount
- ----------------------------------- ---------- ------------
Year ended May 31, 1995:
<S> <C> <C>
Shares sold........................ 4,373,614 $ 53,315,314
Shares reacquired.................. (2,624,605) (31,785,126)
---------- ------------
Net increase in shares outstanding
before conversion................ 1,749,009 21,530,188
Shares reacquired upon conversion
into Class A..................... (926,144) (10,461,391)
---------- ------------
Net increase in shares
outstanding...................... 822,865 $ 11,068,797
---------- ------------
---------- ------------
Year ended May 31, 1994:
Shares sold........................ 4,232,426 $ 51,893,670
Shares reacquired.................. (2,098,628) (25,369,458)
---------- ------------
Net increase in shares
outstanding...................... 2,133,798 $ 26,524,212
---------- ------------
---------- ------------
<CAPTION>
Class C
- -----------------------------------
<S> <C> <C>
August 1, 1994* through
May 31, 1995:
Shares sold........................ 52,700 $ 651,843
Shares reacquired.................. (7,341) (88,329)
---------- ------------
Net increase in shares
outstanding...................... 45,359 $ 563,514
---------- ------------
---------- ------------
- ---------------
* Commencement of offering of Class C shares.
</TABLE>
- --------------------------------------------------------------------------------
11 -----
<PAGE>
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Financial Highlights RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A Class B
--------------------------------------------------- -------------------------------
Year Ended May 31, Year Ended May 31,
--------------------------------------------------- -------------------------------
1995 1994 1993 1992 1991 1995 1994 1993
------- ------ ------ ------ ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE(b):
Net asset value, beginning of period... $ 12.55 $11.84 $10.02 $ 9.73 $10.17 $ 12.29 $ 11.69 $ 9.97
------- ------ ------ ------ ------ ------- ------- -------
Income from investment operations
Net investment income (loss)........... (.03) .01 .02 .01 .13 (.13) (.08) (.07)
Net realized and unrealized gain (loss)
on investment and foreign currency
transactions......................... 1.21 .70 1.80 .38 (.39) 1.19 .68 1.79
------- ------ ------ ------ ------ ------- ------- -------
Total from investment operations..... 1.18 .71 1.82 .39 (.26) 1.06 .60 1.72
------- ------ ------ ------ ------ ------- ------- -------
Less distributions
Dividends from net investment income... -- -- -- (.09) (.18) -- -- --
Distributions from net realized gains
on investment and foreign currency
transactions......................... -- -- -- (.01) -- -- -- --
------- ------ ------ ------ ------ ------- ------- -------
Total distributions................. -- -- -- (.10) (.18) -- -- --
------- ------ ------ ------ ------ ------- ------- -------
Net asset value, end of period......... $ 13.73 $12.55 $11.84 $10.02 $ 9.73 $ 13.35 $ 12.29 $ 11.69
------- ------ ------ ------ ------ ------- ------- -------
------- ------ ------ ------ ------ ------- ------- -------
TOTAL RETURN(c):....................... 9.40% 6.00% 18.16% 4.04% (2.59)% 8.62% 5.13% 17.25%
RATIOS TO AVERAGE NET ASSETS:
Net assets, end of period (000)........ $19,682 $6,505 $1,898 $590 $770 $80,774 $64,235 $36,150
Average net assets (000)............... $10,791 $4,106 $758 $647 $664 $74,681 $48,772 $23,464
Ratios to average net assets:(d)
Expenses, including distribution
fees............................. 1.73% 1.89% 2.38% 2.59% 2.22% 2.48% 2.65% 3.18%
Expenses, excluding distribution
fees............................. 1.48% 1.65% 2.18% 2.39% 2.02% 1.48% 1.65% 2.18%
Net investment income (loss)........... (.25)% .11% .13% .44% 1.47% (1.05)% (.67)% (.67)%
Portfolio turnover..................... 36% 19% 50% 36% 40% 36% 19% 50%
<CAPTION>
Class C
---------
August 1,
1994*
through
May 31,
1992 1991 1995
------- ------- ---------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE(b):
Net asset value, beginning of period... $ 9.72 $ 10.14 $ 12.47
------- ------- ---------
Income from investment operations
Net investment income (loss)........... (.08) .06 (.13)
Net realized and unrealized gain (loss)
on investment and foreign currency
transactions......................... .39 (.39) 1.01
------- ------- ---------
Total from investment operations..... .31 (.33) .88
------- ------- ---------
Less distributions
Dividends from net investment income... (.05) (.09) --
Distributions from net realized gains
on investment and foreign currency
transactions......................... (.01) -- --
------- ------- ---------
Total distributions................. (.06) (.09) --
------- ------- ---------
Net asset value, end of period......... $ 9.97 $ 9.72 $ 13.35
------- ------- ---------
------- ------- ---------
TOTAL RETURN(c):....................... 3.26% (3.31)% 7.06%
RATIOS TO AVERAGE NET ASSETS:
Net assets, end of period (000)........ $23,228 $33,653 $606
Average net assets (000)............... $26,877 $40,090 $294
Ratios to average net assets:(d)
Expenses, including distribution
fees............................. 3.39% 3.02% 2.56%(a)
Expenses, excluding distribution
fees............................. 2.39% 2.02% 1.56%(a)
Net investment income (loss)........... (.34)% .58% (1.08)%(a)
Portfolio turnover..................... 36% 40% 36%
</TABLE>
- ---------------
(a) Annualized.
(b) Calculated based upon average shares outstanding during fiscal period
except 1991.
(c) Total return does not consider the effects of sales loads. Total return
is calculated assuming a purchase of shares on the first day and a sale
on the last day of each period reported and includes reinvestment of
dividends and distributions. Total returns for periods of less than
a full year are not annualized.
(d) Because of the recent commencement of its offering, the ratios for
Class C shares are not necessarily comparable to that of Class A or
Class B shares and are not necessarily indicative of future ratios.
* Commencement of offering class C shares.
- --------------------------------------------------------------------------------
- ----- 12 See Notes to Financial Statements.
<PAGE>
PRUDENTIAL GLOBAL NATURAL
Report of Independent Accountants RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
To the Board of Directors and Shareholders of
Prudential Global Natural Resources Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Prudential Global Natural Resources
Fund, Inc. (the ``Fund'') at May 31, 1995, the results of its operations for the
year then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for each of the five years in the
period then ended, in conformity with generally accepted accounting principles.
These financial statements and financial highlights (hereafter referred to as
``financial statements'') are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at May 31,
1995 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York
July 24, 1995
PRUDENTIAL GLOBAL NATURAL
Tax Information RESOURCES FUND, INC.
- --------------------------------------------------------------------------------
In January 1996, you will be advised on IRS Form 1099, DIV or substitute Form
1099, as to the federal tax status of the distributions received by you in
calendar 1995. The amounts that will be reported on such form 1099 DIV will be
the amounts to use on your federal income tax return and will differ from the
amounts which we must report for the Fund's fiscal year ended May 31, 1995.
- --------------------------------------------------------------------------------
13 -----
<PAGE>
