<PAGE>
ANNUAL REPORT MAY 31, 2000
Prudential
Global Genesis Fund, Inc.
FUND TYPE Global Stock
OBJECTIVE Long-term growth of capital
(GRAPHIC)
This report is not authorized for distribution to
prospective investors unless preceded or accompanied by a
current prospectus.
The views expressed in this report and information about
the Fund's portfolio holdings are for the period covered
by this report and are subject to change thereafter.
(LOGO)
<PAGE>
Build on the Rock
Investment Goals and Style
The Prudential Global Genesis Fund seeks to achieve long-
term growth of capital by investing primarily in common
stocks and other equity securities of smaller foreign and
U.S. companies. The Fund is subject to all the risks
associated with foreign investing, including currency,
political and social risks, and potential illiquidity.
There can be no assurance that the Fund will achieve its
investment objective.
Geographic Concentration
Expressed as a percentage of
net assets as of 5/31/00
52.8% United States
21.4 Continental Europe
11.7 Japan
8.9 United Kingdom
2.9 Asia/Pacific Basin (ex-Japan)
0.9 Latin America
1.4 Cash & Equivalents
Ten Largest Holdings
Expressed as a percentage of
net assets as of 5/31/00
1.4% AmeriSource Health Corp.
Drugs and Medical Supplies
1.1 Imax Corp.
Electronic Components
1.1 Tech Data Corp.
Distribution/Wholesalers
1.1 Clearnet Communications
Cellular Communications
1.0 Whole Foods Market, Inc.
Foods
1.0 BrightPoint, Inc.
Distribution/Wholesalers
1.0 American Management Sys., Inc.
Data Processing/Management
1.0 Applica, Inc.
Home Furnishings
0.9 Remec, Inc.
Aerospace/Defense
0.9 Acxiom Corp.
Data Processing/Management
<PAGE>
www.prudential.com (800) 225-1852
Performance at a Glance
Cumulative Total Returns1 As of 5/31/00
One Five Ten Since
Year Years Years Inception2
Class A 25.95% 58.63% 138.92% 142.95%
Class B 25.08 52.79 121.25 201.77
Class C 25.08 52.79 N/A 48.36
Class Z 26.21 N/A N/A 44.17
Lipper Global
Small-Cap
Fund Avg.3 34.42 106.05 195.15 ***
Average Annual Total Returns1 As of 6/30/00
One Five Ten Since
Year Years Years Inception2
Class A 19.09% 9.13% 8.91% 8.97%
Class B 19.68 9.31 8.65 9.84
Class C 22.43 9.23 N/A 7.81
Class Z 25.73 N/A N/A 11.91
Past performance is not indicative of future results.
Principal and investment return will fluctuate so that an
investor's shares, when redeemed, may be worth more or
less than their original cost.
1 Source: Prudential Investments Fund Management LLC and
Lipper Inc. The cumulative total returns do not take into
account sales charges. The average annual total returns
do take into account applicable sales charges. The Fund
charges a maximum front-end sales charge of 5% for Class
A shares.
Class B shares are subject to a declining contingent
deferred sales charge (CDSC) of 5%, 4%, 3%, 2%, 1%, and
1% for six years. Class B shares will automatically
convert to Class A shares, on a
quarterly basis, approximately seven years after
purchase. Class C shares are subject to a front-end sales
charge of 1% and a CDSC of 1% for 18 months. Class Z
shares are not subject to a sales charge or distribution
and service (12b-1) fees.
2 Inception dates: Class A, 1/22/90; Class B, 1/29/88;
Class C, 8/1/94; and Class Z, 9/16/96.
3 Lipper average returns are for all funds in each share
class for the one-, five-, and ten-year periods in the
Global Small-Cap Fund category. The Lipper average is
unmanaged. Funds in the Global Small-Cap category invest
at least 25% of their portfolio in securities with
primary trading markets outside the United States, and
that limit their investments to companies with market
capitalizations less than U.S.$1 billion at the time of
purchase.
***Lipper Since Inception returns are 185.48% for Class
A, 238.71% for Class B, 114.34% for
Class C, and 57.03% for Class Z, based on all funds in
each share class.
1
<PAGE>
(LOGO) July 17, 2000
Dear Shareholder,
During the one-year reporting period ended May 31, 2000,
the Prudential Global Genesis Fund's Class A shares
posted a strong 25.95% return-19.65% to those paying the
one-time Class A share sales charge.
This compares very favorably to the 15.84% return for the
Salomon EMI Index of global small company stocks. The
Lipper Global Small-Cap Fund Average posted even stronger
results, rising 34.42% during the reporting period. We
suspect that other mutual funds in this category had a
much higher concentration of their assets in technology
stocks. In contrast, the Fund continued to hold a more
broadly diversified portfolio-one that sought to temper
risks and take advantage of the vast opportunities in the
marketplace.
Fund to merge
In May, the Fund's Board of Directors approved its merger
into the Prudential Global Growth Fund, which is expected
to take place in late September 2000 (subject to
shareholder approval). The Prudential Global Growth Fund
invests primarily in medium- and larger-cap growth
stocks. We believe the merger should enable shareholders
to participate in an even greater number of investment
opportunities, and to benefit from lower fund expense
ratios. Shareholders will receive additional information
after the merger has occurred.
As always, we appreciate your confidence, and look
forward to serving your investment needs in the future.
Yours sincerely,
John R. Strangfeld, President
Prudential Global Genesis Fund, Inc.
2
<PAGE>
Prudential Global Genesis Fund, Inc.
Annual Report May 31, 2000
Investment Adviser's Report
Positive structural changes
Throughout much of the reporting period, investors were
drawn to the positive trends occurring in the global
small-cap marketplace. For example, with the vast
acceptance of the Internet, smaller and relatively newer
companies can now effectively sell their products and
services directly to end users. As a result, these firms
do not have to incur the time and expense of developing
an extensive distribution channel. This has helped many
small-cap companies to become profitable in time frames
that were once thought impossible.
The ongoing economic rebound in the emerging markets was
also a boost to small-cap stocks. This dramatic
turnaround has increased the demand for products and
services provided by smaller companies. In addition, it
has made many investors more comfortable with taking on
the added risks associated with smaller-cap issues.
A wide array of opportunities
Small-cap stocks in a variety of sectors rose during the
reporting period, and the Fund's performance was aided by
strong stock selection. Overall, the technology sector
provided compelling returns, especially during the first
10 months of the period. Overseas, European Internet
stocks were particularly strong. The Fund's energy stocks also rose
substantially, as our holdings in both oil exploration
and oil service stocks enhanced returns.
In addition, several of our distribution-related issues
and diversified consumer stocks yielded good results, and
the Fund's financial and insurance stocks were a boon to
performance, due in part to consolidation occurring in
these industries.
3
<PAGE>
Prudential Global Genesis Fund, Inc.
Holdings expressed as a percentage of the Fund's net
assets
Comments on Largest Holdings As of 5/31/00
1.4% AmeriSource Health Corp./Drugs and Medical Supplies
The fourth largest wholesale distributor of drugs and
healthcare services in the United States. Concerns over
competition from the Internet and the potential for a
decline in drug prices caused this stock to fall sharply. We
purchased shares on this weakness, as AmeriSource's
business fundamentals remained strong. Since that time,
its share price has appreciated sharply.
1.1% Imax Corp./Electronic Components
Imax holds a worldwide monopoly with its large-screen
cinema system. The firm's stock price fell due to delays
in shipments of new orders. However, no orders were
actually canceled, and its share price has begun to
rebound from its depressed level.
1.1% Tech Data Corp./Distribution Wholesalers
A distributor of computers and peripherals to value-added
retailers. The stock became oversold due to the sell-off
in the technology sector. We took this opportunity to
purchase shares, and its share price has subsequently
risen sharply higher.
1.1% Clearnet Communications/Cellular Communications
This long-term Fund holding has been a major contributor
in our wireless communications theme. The firm operates
two wireless networks throughout Canada, and has been
rewarded for its rapid growth rates and quality
management team.
1.0% Whole Foods Market, Inc./Foods
Whole Foods remains the largest natural foods supermarket
chain in the United States. The stock fell when it didn't
meet earnings expectations in January. However, it has
since spun off some underperforming assets and is again
concentrating on its core business.
Holdings are subject to change.
4
<PAGE>
www.prudential.com (800) 225-1852
Annual Report May 31, 2000
Wireless communications lead the way
Certainly, one of the most important contributors to Fund
performance was its wireless communications stocks-both
in the United States and abroad. It's almost impossible
to overstate the vast changes occurring as a result of
the new communications revolution. The penetration of
wireless phone usage continues to surge, and tremendous
opportunities in countries such as China remain untapped.
We also believe that features such as wireless Internet
access and instant messaging will lead this industry for
years to come.
Basic materials disappoint
Unfortunately, the Fund's overweight position in basic
materials stocks did not meet our expectations. We
believed that global economic growth would lead to
increased demand for materials to supply consumer and
business needs. In addition, many stocks in this sector
were relatively inexpensive, especially compared to
technology issues. However, while demand for basic
materials did indeed rise, this did not propel their
stock prices upward, as pricing pressures in the
marketplace did not lead to higher profitability. As a
result, consumers continued to be drawn to the upward
momentum in stocks in other sectors. With the prospect of
slower economic growth, we have dramatically reduced the
Fund's exposure to basic materials stocks.
Anticipating the shifting market
Active management of the Fund's portfolio helped us to
navigate the rough seas that we encountered toward the
end of the reporting period. In December 1999, our
concern over rich valuation levels in the technology
sector, surging oil prices, and the prospect of rising
interest rates led us to take a more defensive stance.
Overseas, we took profits from our European Internet
stocks, and shifted out of smaller Asian countries such
as the Philippines and Indonesia. These proceeds were
placed in more developed, less risky countries, and in
sectors with more predictable earnings streams.
5
<PAGE>
Prudential Global Genesis Fund, Inc.
Annual Report May 31, 2000
We also moved from an overweight position in the
technology sector to a modest underweight in the United
States and abroad. This repositioning hurt the Fund
relative to its benchmark in January and February, as
technology and riskier issues continued to outperform.
However, when the market abruptly reversed course in
March, the Fund was rewarded for its more conservative
stance.
Looking ahead
In recent weeks, the market has rebounded somewhat from
its steep decline, especially in the technology sector.
This has been precipitated by signs that the Federal
Reserve Board's interest rate hikes may finally be
slowing economic growth to a more modest pace. Higher
unemployment rates and stabilizing consumer prices have
led many investors to believe that the Fed's tightening
monetary policy may be over sooner rather than later.
This scenario would likely aid the financial markets in
the United States and abroad.
However, we believe it will take some time for the
economic picture to become clearer. While a recession is
not likely, it cannot be entirely ruled out, and even a
"soft landing," where the economy slows but not too far,
could damage corporate profits. It is our belief that the
markets will remain unsettled until it is evident that
the economy is on track, and that corporate profits are
strong enough to validate valuation levels. When this
occurs, we anticipate that the markets will respond
favorably, and that the long-term outlook for equities
will be positive.
Prudential Global Genesis Fund Management Team
6
<PAGE>
Prudential Global Genesis Fund, Inc.
Annual Report May 31, 2000
Financial
Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
<C> <S> [ZW]
<C> <C>
------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS 93.0%
Common Stocks 92.4%
-------------------------------------------------------------------------------------
Australia 0.4%
27,100 Broken Hill Proprietary Co., Ltd. $ [ZW]
276,269
-------------------------------------------------------------------------------------
Austria 0.3%
11,246 Adcon Telemetry AG [ZW]
205,108
-------------------------------------------------------------------------------------
Finland 0.5%
30,198 JOT Automation Group Oyj [ZW]
177,373
28,354 Metsa-Serla Oyj, Class B [ZW]
221,438
[ZW]
--------------
[ZW]
398,811
-------------------------------------------------------------------------------------
France 4.0%
7,276 ActivCard S.A.(a) [ZW]
136,425
1,534 Aubay Technology S.A.(a) [ZW]
220,521
6,248 Bouygues Offshore S.A. [ZW]
303,875
1,947 Castorama Dubois [ZW]
493,499
2,851 Club Mediterranee S.A. [ZW]
359,983
8,230 Credit Lyonnais S.A. [ZW]
354,394
5,487 ILOG S.A.(a) [ZW]
177,054
5,271 Ingenico S.A. [ZW]
502,856
6,827 Societe Generale D'Enterprises S.A.(a) [ZW]
301,322
7,420 Vallourec S.A. [ZW]
270,657
17,840 XRT-CERG [ZW]
131,651
[ZW]
--------------
[ZW]
3,252,237
-------------------------------------------------------------------------------------
Germany 2.9%
4,275 BKN International AG [ZW]
240,704
115 ce Consumer Electronic AG [ZW]
15,058
3,922 Entrium Direct Bankers AG [ZW]
188,915
2,452 Epcos AG(a) [ZW]
300,085
608 Intershop Communications AG(a) [ZW]
246,231
4,906 Kamps AG [ZW]
130,775
15,496 NSE Software AG(a) [ZW]
260,881
1,361 Parsytec AG(a) [ZW]
267,318
</TABLE>
8 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
7,933 Suss Micro Technology AG $ [ZW]
288,628
2,138 Telegate AG(a) [ZW]
247,959
3,737 Tomorrow Internet AG(a) [ZW]
150,294
[ZW]
--------------
[ZW]
2,336,848
-------------------------------------------------------------------------------------
Hong Kong 0.8%
763,000 Lung Kee Holdings Ltd. [ZW]
140,997
203,000 QPL International Holdings Ltd.(a) [ZW]
286,558
89,500 Wing Hang Bank, Ltd. [ZW]
177,449
[ZW]
--------------
[ZW]
605,004
-------------------------------------------------------------------------------------
India 0.2%
1,180 Infosys Technologies, Ltd. [ZW]
185,041
-------------------------------------------------------------------------------------
Ireland 0.1%
15,420 Horizon Technology Group PLC(a) [ZW]
112,494
-------------------------------------------------------------------------------------
Israel 0.6%
3,090 Card-Guard Scientific Survival Ltd.(a) [ZW]
134,076
18,872 GEO Interact Media Group PLC(a) [ZW]
169,610
6,000 Orckit Communications, Ltd(a) [ZW]
150,094
[ZW]
--------------
[ZW]
453,780
-------------------------------------------------------------------------------------
Italy 1.1%
41,460 Banca Popolare di Milano Scrl, SpA [ZW]
270,667
21,167 Brembo, SpA(a) [ZW]
225,691
27,522 Bulgari, SpA [ZW]
344,934
[ZW]
--------------
[ZW]
841,292
-------------------------------------------------------------------------------------
Japan 11.7%
2,300 Alpha Systems, Inc. [ZW]
296,575
4,100 Aucnet, Inc. [ZW]
193,455
4,200 Avex, Inc. [ZW]
388,171
35,000 Bank of Saga, Ltd. [ZW]
119,397
850 Bellsystem, Inc. [ZW]
483,801
1,600 C Two Network Co., Ltd. [ZW]
282,401
</TABLE>
See Notes to Financial Statements 9
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
25,000 C Uyemura & Co., Ltd. $ [ZW]
452,144
21,000 Daifuku Co., Ltd. [ZW]
183,379
11,000 Daikin Industries Ltd. [ZW]
218,725
11,400 Daiseki Co., Ltd. [ZW]
216,111
1,000 Drake Beam Morin-Japan, Inc. [ZW]
139,050
3,840 Fancl Corp. [ZW]
352,408
2,100 Fuji S Ware ABC [ZW]
102,786
10 Future System Consulting Corp. [ZW]
217,845
5,000 Global Dining, Inc. [ZW]
345,307
3,700 GoldCrest Co., Ltd. [ZW]
411,587
25,000 Hokuetsu Paper Mills, Ltd. [ZW]
194,438
20,000 Ibiden Co., Ltd. [ZW]
385,632
4,200 Itoen Ltd. [ZW]
284,607
18,600 Mimasu Semiconductor Industry Co., Ltd. [ZW]
317,256
18 Ministop Co., [ZW]
Ltd. 395
2,950 Misumi Corp. [ZW]
264,167
3,000 Nichii Gakkan Co. [ZW]
179,930
900 Otsuka Kagu Ltd. [ZW]
205,238
4,500 Paramount Bed Co., Ltd. [ZW]
328,714
7,000 Plenus Co., Ltd. [ZW]
320,556
14,000 Pulstec Industrial Co., Ltd. [ZW]
246,711
5,000 Rock Field Co., Ltd. [ZW]
245,655
3,000 Ryohin Keikaku Co., Ltd. [ZW]
436,338
9,710 Sato Corp. [ZW]
265,534
30,000 Sumitomo Bakelite Co., Ltd. [ZW]
336,501
10,000 Trancom Co., Ltd. [ZW]
50,058
4,000 Trend Micro, Inc. [ZW]
545,075
14,300 United Arrows Ltd. [ZW]
498,429
[ZW]
--------------
[ZW]
9,508,376
-------------------------------------------------------------------------------------
Korea 0.3%
2,800 LG Home Shopping, Inc. [ZW]
237,486
-------------------------------------------------------------------------------------
Mexico 1.1%
10,300 Cemex, S.A.(a) [ZW]
218,231
80,000 Grupo Mexico, S.A.(a) [ZW]
272,684
</TABLE>
10 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
2,900 Tubos de Acero de Mexico, S.A. (ADR) $ [ZW]
39,150
25,000 Tubos de Acero de Mexico, S.A.(a) [ZW]
331,387
[ZW]
--------------
[ZW]
861,452
-------------------------------------------------------------------------------------
Netherlands 0.5%
3,798 ASM Lithography Holdings N.V.(a) [ZW]
140,173
10,149 Fox Kids Europe N.V.(a) [ZW]
135,266
7,258 Ifco Systems N.V. [ZW]
162,922
[ZW]
--------------
[ZW]
438,361
-------------------------------------------------------------------------------------
Norway 0.3%
21,234 EDB Business Partners, ASA(a) [ZW]
279,586
-------------------------------------------------------------------------------------
Portugal 0.2%
3,246 PT Multimedia Servicos SGPS. S.A.(a) [ZW]
163,488
-------------------------------------------------------------------------------------
South Korea 0.5%
1,500 Samsung Electronics Co.(a) [ZW]
409,031
-------------------------------------------------------------------------------------
Spain 0.6%
17,349 Centros Comerciales Continente, S.A. [ZW]
313,983
129,463 Tubacex, S.A. [ZW]
213,113
[ZW]
--------------
[ZW]
527,096
-------------------------------------------------------------------------------------
Sweden 1.5%
54,615 Boss Media AB(a) [ZW]
469,180
24,375 Effnet Group AB(a) [ZW]
146,850
2,240 Enea Data AB [ZW]
376,865
17,149 Framtidsfabriken AB [ZW]
251,595
[ZW]
--------------
[ZW]
1,244,490
-------------------------------------------------------------------------------------
Switzerland 3.6%
531 Adecco, S.A.(a) [ZW]
420,407
14,690 Carrier1 Intl., S.A.(a) [ZW]
231,368
999 Clariant, S.A.(a) [ZW]
371,122
</TABLE>
See Notes to Financial Statements 11
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
694 Geberit International AG(a) $ [ZW]
223,578
1,811 Gretag Imaging Group AG [ZW]
344,460
205 Mikron Holding AG(a) [ZW]
154,627
632 Saurer AG(a) [ZW]
360,628
722 Swisslog Holding AG [ZW]
336,882
388 The Swatch Group AG(a) [ZW]
476,236
[ZW]
--------------
[ZW]
2,919,308
-------------------------------------------------------------------------------------
Taiwan 0.3%
91,200 United Microelectronics Corp., Ltd. [ZW]
276,767
-------------------------------------------------------------------------------------
United Kingdom 8.9%
131,228 Aegis Group PLC [ZW]
340,060
253,098 Aggregate Industries PLC [ZW]
259,050
14,336 Amvescap PLC [ZW]
188,326
38,180 Baltimore Technologies PLC(a) [ZW]
263,073
52,972 Berisford PLC [ZW]
261,845
39,422 Billiton PLC [ZW]
134,044
26,747 Bioglan Pharma PLC(a) [ZW]
177,084
21,948 Capita Group PLC [ZW]
497,742
114,406 Cattles PLC [ZW]
464,170
43,438 Compass Group PLC [ZW]
487,343
8,714 Dialog Semiconductor PLC [ZW]
423,810
7,075 Energis PLC(a) [ZW]
269,180
65,401 Enterprise Oil PLC [ZW]
467,289
22,486 Geest PLC [ZW]
168,658
11,901 Kewill Systems PLC(a) [ZW]
154,734
119,292 Mayflower Corp. PLC [ZW]
314,043
48,729 Mowlem (John) & Co. PLC [ZW]
79,560
37,175 Sage Group PLC (The) [ZW]
361,114
136,735 Scoot.Com PLC [ZW]
317,976
60,372 Serco Group PLC [ZW]
405,132
26,008 Shire Pharma Group [ZW]
385,678
</TABLE>
12 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
112,167 Skyepharma PLC(a) $ [ZW]
157,514
115,395 Synstar(a) [ZW]
202,580
33,593 Thus PLC(a) [ZW]
155,234
21,244 WPP Group PLC [ZW]
258,708
[ZW]
--------------
[ZW]
7,193,947
-------------------------------------------------------------------------------------
United States 52.0%
30,700 Acer, Inc.(a) [ZW]
310,991
22,200 Acxiom Corp.(a) [ZW]
649,350
48,100 Advanced Lighting Technologies, Inc.(a) [ZW]
502,044
2,300 Airgate PCS, Inc. [ZW]
69,431
13,200 Allied Capital Corp. [ZW]
225,225
21,900 American Management Systems, Inc.(a) [ZW]
819,881
46,700 AmeriSource Health Corp.(a) [ZW]
1,138,312
10,000 Anadigics, Inc.(a) [ZW]
346,875
9,000 Apollo Group, Inc. [ZW]
261,563
53,200 Applica, Inc. [ZW]
784,700
17,400 Applied Power, Inc. [ZW]
481,762
4,440 Autonomy Corp. PLC(a) [ZW]
481,740
14,600 Banknorth Group, Inc. [ZW]
203,488
3,800 BJ Services Co.(a) [ZW]
272,175
10,500 Braun Consulting, Inc. [ZW]
158,813
7,100 Breezecom Ltd.(a) [ZW]
175,281
19,400 Bright Horizons Family Solutions, Inc.(a) [ZW]
328,588
70,200 Brightpoint, Inc.(a) [ZW]
820,462
9,400 Carrier Access Corp. [ZW]
347,947
68,000 Cellstar Corp.(a) [ZW]
191,250
14,700 Centerpoint Properties Trust [ZW]
539,306
5,300 Cheap Tickets, Inc.(a) [ZW]
66,581
10,000 Checkfree Holdings Corp.(a) [ZW]
418,125
53,500 Cinar Corp.(a)(b) [ZW]
374,500
10,300 Claire's Stores, Inc. [ZW]
208,575
</TABLE>
See Notes to Financial Statements 13
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
29,600 Clearnet Communications, Inc. $ [ZW]
851,000
21,300 Click2Learn.Com, Inc. [ZW]
255,600
9,000 Commscope, Inc. [ZW]
347,625
13,600 Concord Camera Corp. [ZW]
230,350
33,260 Consolidated Products, Inc.(a) [ZW]
330,521
3,400 Cubist Pharmaceuticals, Inc. [ZW]
97,325
13,800 Eaton Vance Corp. [ZW]
600,300
4,500 Electro Scientific Industries, Inc.(a) [ZW]
212,625
37,400 Electronics Boutique Holdings Corp. [ZW]
521,263
10,300 Emmis Communications Corp.(a) [ZW]
351,488
31,600 Enhance Financial Services Group, Inc. [ZW]
434,500
6,900 Everest Reinsurance Group, Ltd. [ZW]
234,600
24,500 Forest Oil Corp.(a) [ZW]
390,469
12,400 Furniture Brands International, Inc.(a) [ZW]
197,625
8,400 G & K Services, Inc., Class A [ZW]
210,000
16,800 Galileo Technology Ltd.(a) [ZW]
290,850
73,500 Gaylord Container Corp.(a) [ZW]
294,000
6,400 Gentex Corp.(a) [ZW]
198,400
2,300 Gilead Sciences, Inc.(a) [ZW]
125,781
17,900 Glenayre Technologies, Inc. [ZW]
146,556
4,900 Graco, Inc. [ZW]
157,106
5,100 Great Plains Software, Inc.(a) [ZW]
211,650
2,100 Grupo Televisa S.A. (ADR)(a) [ZW]
116,944
9,400 Hall, Kinion & Associates Inc. [ZW]
239,700
10,000 Hyperion Solutions Corp.(a) [ZW]
313,750
26,400 ICG Communications, Inc.(a) [ZW]
496,650
17,950 Imagex.Com, Inc. [ZW]
104,334
42,300 Imax Corp.(a) [ZW]
920,025
8,700 Integrated Silicon Solution Co., Inc. [ZW]
258,281
20,300 International Home Foods, Inc. [ZW]
345,100
15,600 Intersil Holding Corp.(a) [ZW]
610,350
19,800 Jack in the Box, Inc.(a) [ZW]
491,287
16,400 Kilroy Realty Corp.(a) [ZW]
375,150
15,000 Lam Research Corp.(a) [ZW]
481,875
</TABLE>
14 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
13,300 Liberty Property Trust $ [ZW]
332,500
3,600 Luminex Corp. [ZW]
110,700
17,500 Mail-Well, Inc.(a) [ZW]
164,063
16,800 Marine Drilling Co., Inc.(a) [ZW]
483,000
6,900 Maverick Tube Corp. [ZW]
242,794
11,300 Media Metrix, Inc.(a) [ZW]
314,988
11,200 Metalink, Ltd.(a) [ZW]
280,000
24,800 Milacron, Inc. [ZW]
392,150
51,100 Modis Professional Services, Inc. [ZW]
523,775
12,600 NCO Group, Inc. [ZW]
300,825
6,018 NDS Group PLC(a) [ZW]
400,197
27,000 Network Associates, Inc.(a) [ZW]
590,625
4,200 Neurocrine Biosciences, Inc. [ZW]
89,250
7,400 Newfield Exploration Co.(a) [ZW]
309,875
24,800 Northpoint Communications Group, Inc.(a) [ZW]
387,500
25,500 Oak Technology, Inc.(a) [ZW]
376,125
19,500 Pacific Sunwear Of California [ZW]
313,219
16,900 Pairgain Technologies, Inc.(a) [ZW]
484,819
11,800 Pentair, Inc. [ZW]
463,150
18,800 Photonics, Inc. [ZW]
451,200
10,000 PRI Automation, Inc.(a) [ZW]
513,906
6,360 Priority Healthcare Corp. [ZW]
324,360
17,800 Quorum Health Group, Inc. [ZW]
171,881
8,659 Radian Group, Inc. [ZW]
476,245
21,000 Remec, Inc. [ZW]
712,687
21,600 Renal Care Group, Inc.(a) [ZW]
515,700
34,100 Republic Services, Inc. [ZW]
562,650
17,500 Ross Stores, Inc. [ZW]
369,688
15,000 Rowan Companies, Inc.(a) [ZW]
465,938
5,400 Rural Celluar Corp. [ZW]
363,150
6,200 Safeguard Scientifics, Inc. [ZW]
199,563
3,100 SanDisk Corp.(a) [ZW]
180,188
19,900 Santa Fe Snyder Corp.(a) [ZW]
251,238
10,000 Sawtek Inc. [ZW]
643,125
3,322 SCM Microsystems, Inc. [ZW]
234,583
</TABLE>
See Notes to Financial Statements 15
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
28,600 Sinclair Broadcast Group, Inc.(a) $ [ZW]
235,950
4,500 Skywest, Inc. [ZW]
171,563
21,300 Speedway Motorsports Inc. [ZW]
437,981
26,300 Steiner Leisure Ltd. [ZW]
557,231
7,000 Swift Energy Co. [ZW]
179,813
24,000 Tech Data Corp.(a) [ZW]
901,500
8,700 Tektronix, Inc. [ZW]
465,450
3,200 Telefonos de Mexico S.A. (ADR)(a) [ZW]
155,800
16,900 Teletech Holdings, Inc. [ZW]
553,475
21,600 Tower Automotive, Inc.(a) [ZW]
299,700
7,700 Tut Systems, Inc.(a) [ZW]
398,475
34,700 United Natural Foods, Inc. [ZW]
524,837
4,294 Uproar Ltd. [ZW]
28,113
14,500 US Interactive, Inc.(a) [ZW]
159,500
12,700 US Unwired, Inc. [ZW]
138,906
9,800 Varian Semiconductor Equipment, Inc. [ZW]
467,338
9,200 Veeco Instruments, Inc.(a) [ZW]
414,000
10,500 Western Wireless Corp.(a) [ZW]
502,031
23,800 Whole Foods Market, Inc.(a) [ZW]
827,050
[ZW]
--------------
[ZW]
42,034,415
[ZW]
--------------
Total common stocks (cost US$69,292,921) [ZW]
74,760,687
-------------------------------------------------------------------------------------
PREFERRED STOCKS(a) 0.5%
Brazil
15,700 Companhia Vale do Rio Doce (cost US$344,875) [ZW]
406,718
[ZW]
--------------
WARRANTS(a)
-------------------------------------------------------------------------------------
Canada
Sedna Geotech, Inc.
6,600 Expiring 3/23/01 @ CAD [ZW]
0 0
-------------------------------------------------------------------------------------
Indonesia
Bank Pan Indonesia
123,900 Expiring 7/8/02 @ IDR 500 [ZW]
1,221
[ZW]
--------------
Total warrants (cost US$0) [ZW]
1,221
[ZW]
--------------
</TABLE>
16 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<CAPTION>
Shares Description Value [ZW]
(Note 1)
------------------------------------------------------------------------------------------
<C> <S> [ZW]
<C> <C>
RIGHTS(a)
-------------------------------------------------------------------------------------
Portugal
3,246 PT Multimedia Servicos, SGPS, S.A.
Expiring 6/9/00 @ EUR 0.58 (cost US$0) $ [ZW]
1,761
[ZW]
--------------
CORPORATE BOND 0.1%
<CAPTION>
Principal
Amount
(000)
<C> <S> [ZW]
<C> <C>
-------------------------------------------------------------------------------------
United States
$ 409 Family Golf Centers, Inc.
Subordinated Notes 5.75%, 10/15/04
(cost US$121,363) [ZW]
44,990
[ZW]
--------------
Total long-term investments (cost US$69,759,159) [ZW]
75,215,377
[ZW]
--------------
SHORT-TERM INVESTMENT 1.0%
-------------------------------------------------------------------------------------
Repurchase Agreement
$ 795 Joint Repurchase Agreement Account,
6.31%, 6/01/00 (cost US$795,000; Note 5) [ZW]
795,000
[ZW]
--------------
Total Investments 94.0%
(cost US$70,554,159; Note 4) [ZW]
76,010,377
Other assets in excess of liabilities 6.0% [ZW]
4,880,049
[ZW]
--------------
Net Assets 100% $ [ZW]
80,890,426
[ZW]
--------------
[ZW]
--------------
</TABLE>
------------------------------
(a) Non-income producing security.
(b) Fair valued security.
ADR-American Depository Receipt.
See Notes to Financial Statements 17
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
The industry classification of portfolio holdings and other net assets in excess
of liabilities shown as a percentage of net assets as of May 31, 2000 was as
follows:
<TABLE>
<S> [ZW]
<C> <C>
Computer Software & Services.......................................... 12.4%
Telecommunications.................................................... 8.2
Electronic Components................................................. 7.5
Food & Beverage....................................................... 4.5
Commercial Services................................................... 4.5
Semiconductors........................................................ 4.5
Banks & Financial Services............................................ 4.4
Retail................................................................ 4.1
Oil & Gas Services.................................................... 3.3
Machinery............................................................. 3.0
Distribution/Wholesalers.............................................. 2.5
Medical Products & Services........................................... 2.4
Real Estate........................................................... 2.0
Building & Construction............................................... 1.9
Data Processing/Management............................................ 1.8
Consumer Goods & Cyclicals............................................ 1.8
Steel & Metals........................................................ 1.7
Media................................................................. 1.7
Drugs & Medical Supplies.............................................. 1.6
Restaurants........................................................... 1.4
Diversified Industries................................................ 1.4
Auto Related.......................................................... 1.3
Home Furnishings...................................................... 1.2
Industrial Components................................................. 1.1
Human Resources....................................................... 1.1
Manufacturing......................................................... 1.1
Chemicals............................................................. 1.0
Leisure Sector........................................................ 1.0
Aerospace/Defense..................................................... 0.9
Waste Management...................................................... 0.7
Schools............................................................... 0.7
Oil & Gas-Production/Pipeline......................................... 0.7
Technology............................................................ 0.6
Medical Technology.................................................... 0.6
Health Services....................................................... 0.6
Paper & Forest Products............................................... 0.5
</TABLE>
18 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Portfolio of Investments as of May 31, 2000 Cont'd.
<TABLE>
<S> [ZW]
<C> <C>
Radio & Television.................................................... 0.4%
Pharmaceuticals....................................................... 0.4
Merchandising......................................................... 0.4
Containers & Packaging................................................ 0.4
Publishing & Printing................................................. 0.4
Insurance-Property & Casualty......................................... 0.3
Photography........................................................... 0.3
Mineral Resources..................................................... 0.3
Exploration & Production.............................................. 0.3
Agriculture & Plantation.............................................. 0.3
Advertising........................................................... 0.3
Airlines.............................................................. 0.2
Gas Utilities......................................................... 0.2
Repurchase Agreement.................................................. 0.1
------
94.0
Other assets in excess of liabilities................................. 6.0
------
100.0%
------
------
</TABLE>
See Notes to Financial Statements 19
<PAGE>
Prudential Global Genesis Fund, Inc.
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
May 31, 2000
<S> [ZW]
<C> <C>
---------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $70,554,159) $76,010,377
Foreign currency, at value (cost $1,688,213) 1,639,799
Cash 827
Receivable for investments sold 4,115,612
Dividends and interest receivable 176,004
Receivable for Fund shares sold 29,091
Deferred expenses and other assets 2,824
------------
Total assets 81,974,534
------------
LIABILITIES
Payable for investments purchased 567,133
Accrued expenses and other liabilities 282,335
Payable for Fund shares purchased 132,117
Management fee payable 71,837
Distribution fee payable 19,860
Withholding taxes payable 10,826
------------
Total liabilities 1,084,108
------------
NET ASSETS $80,890,426
------------
------------
Net assets were comprised of:
Common stock, at par $ 49,940
Paid-in capital in excess of par 73,319,093
------------
73,369,033
Accumulated net investment loss [ZW]
(10,826 )
Accumulated net realized gain on investments 2,155,551
Net unrealized appreciation on investments and foreign
currency transactions 5,376,668
------------
Net assets, May 31, 2000 $80,890,426
------------
------------
</TABLE>
20 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Statement of Assets and Liabilities Cont'd.
<TABLE>
<CAPTION>
May 31, 2000
<S> [ZW]
<C> <C>
---------------------------------------------------------------------------------------
Class A:
Net asset value and redemption price per share
($34,888,573 / 2,024,652 shares of common stock issued and
outstanding) $17.23
Maximum sales charge (5% of offering price) .91
------------
Maximum offering price to public $18.14
------------
------------
Class B:
Net asset value, offering price and redemption price per share
($44,323,451 / 2,866,120 shares of common stock issued and
outstanding) $15.46
------------
------------
Class C:
Net asset value and redemption price per share
($986,692 / 63,805 shares of common stock issued and
outstanding) $15.46
Sales charge (1% of offering price) .16
------------
Offering price to public $15.62
------------
------------
Class Z:
Net asset value, offering price and redemption price per share
($691,710 / 39,446 shares of common stock issued and
outstanding) $17.54
------------
------------
</TABLE>
See Notes to Financial Statements 21
<PAGE>
Prudential Global Genesis Fund, Inc.
Statement of Operations
<TABLE>
<CAPTION>
Year
Ended
May 31, 2000
<S> [ZW]
<C> <C>
---------------------------------------------------------------------------------------
NET INVESTMENT INCOME
Income
Dividends (net of foreign withholding taxes of $80,495) $ 666,079
Interest 168,790
------------
Total income 834,869
------------
Expenses
Management fee 843,758
Distribution fee--Class A 89,346
Distribution fee--Class B 443,841
Distribution fee--Class C 8,723
Transfer agent's fees and expenses 280,000
Custodian's fees and expenses 278,000
Reports to shareholders 60,000
Registration fees 45,000
Audit fees 32,000
Directors' fees and expenses 20,000
Legal fees and expenses 20,000
Miscellaneous 5,999
------------
Total expenses 2,126,667
------------
Net investment loss [ZW]
(1,291,798 )
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
Net realized gain (loss) on:
Investment transactions 19,559,127
Foreign currency transactions [ZW]
(94,986 )
Financial futures contracts 153,601
------------
19,617,742
------------
Net change in unrealized appreciation (depreciation) on:
Investments 1,242,287
Foreign currencies [ZW]
(317,801 )
------------
924,486
------------
Net gain on investments and foreign currencies 20,542,228
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $19,250,430
------------
------------
</TABLE>
22 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended May 31,
[ZW]
------------------------------------
2000 1999
-----------------------------------------------------------------------------------
<S> <C> [ZW]
<C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations
Net investment loss $ (1,291,798) $ (1,126,573)
Net realized gain (loss) on investments
and foreign currency transactions 19,617,742 (13,226,899)
Net change in unrealized appreciation
(depreciation) on investments and
foreign currencies 924,486 (1,275,835)
-------------- [ZW]
------------------
Net increase (decrease) in net assets
resulting from operations 19,250,430 (15,629,307)
-------------- [ZW]
------------------
Distributions from net realized gain on
investments (Note 1)
Class A -- (1,572,601)
Class B -- (2,669,626)
Class C -- (43,207)
Class Z -- (13,402)
-------------- [ZW]
------------------
-- (4,298,836)
-------------- [ZW]
------------------
Fund share transactions (net of share
conversions) (Note 6)
Net proceeds from shares sold 76,263,455 36,835,124
Net asset value of shares issued in
reinvestment of distributions -- 4,115,350
Cost of shares reacquired (91,145,311) (77,430,853)
-------------- [ZW]
------------------
Net decrease in net assets from Fund
share transactions (14,881,856) (36,480,379)
-------------- [ZW]
------------------
Total increase (decrease) 4,368,574 (56,408,522)
NET ASSETS
Beginning of year 76,521,852 132,930,374
-------------- [ZW]
------------------
End of year $ 80,890,426 $ 76,521,852
-------------- [ZW]
------------------
-------------- [ZW]
------------------
</TABLE>
See Notes to Financial Statements 23
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements
Prudential Global Genesis 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 companies with market capitalizations of less than U.S. $1
billion, as measured at time of purchase.
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 and NASDAQ
National Market System are valued at the last sale price on such exchange system
or, if there was no sale on such day, at the mean between the last bid and asked
prices, or at the bid price in the absence of an asked price. Corporate bonds
(other than convertible) and U.S. government securities are valued on the basis
of valuations provided by an independent pricing agent or principal market
maker. Convertible debt securities are valued at the mean between the last
reported bid and asked prices provided by principal market makers. Options are
valued at the mean between the most recently quoted bid and asked prices on the
exchange on which they are traded. Futures contracts and options thereon are
valued at their last sale prices as of the close of trading on the applicable
commodities exchange or, if there was no sale on such day at the mean between
the most recently quoted bid and asked prices. Securities for which reliable
market quotations are not readily available are valued by the Valuation
Committee or Board of Directors in consultation with the manager or subadvisor.
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.
Repurchase Agreements: 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.
24
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
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 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 year.
Net realized gain (loss) on foreign currency transactions represent net
foreign exchange gains (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 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. Expenses are recorded on the accrual basis which may require the
use of certain estimates by management.
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.
Financial Futures Contracts: A financial futures contract is an
agreement to purchase (long) or sell (short) an agreed amount of securities at a
set price for delivery
25
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
on a future date. Upon entering into a financial futures contract, the Fund is
required to pledge to the broker an amount of cash and/or other assets equal to
a certain percentage of the contract amount. This amount is known as the
'initial margin.' Subsequent payments, known as 'variation margin,' are made or
received by the Fund each day, depending on the daily fluctuations in the value
of the underlying security. Such variation margin is recorded for financial
statement purposes on a daily basis as unrealized gain or loss. When the
contract expires or is closed, the gain or loss is realized and is presented in
the statement of operations as net realized gain (loss) on financial futures
contracts.
The Fund invests in financial futures contracts in order to hedge existing
portfolio securities, or securities the Fund intends to purchase, against
fluctuations in value. Under a variety of circumstances, the Fund may not
achieve the anticipated benefits of the financial futures contracts and may
realize a loss. The use of futures transactions involves the risk of imperfect
correlation in movements in the price of futures contracts and the underlying
assets.
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 on such securities.
Dividends and Distributions: The Fund expects to pay dividends of net
investment income and distributions of net realized capital gains, if any, at
least annually. 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 of wash sales, accounting for passive foreign investment companies
and foreign currency transactions.
Reclassification of Capital Accounts: The Fund accounts for and reports
distributions to shareholders in accordance with American Institute of Certified
Public Accountants (AICPA), 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 of Position
26
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
was to decrease accumulated net investment loss by $1,300,975, decrease
accumulated net realized gain on investments by $1,287,011 and decrease paid-in
capital in excess of par by $13,964 for differences in the treatment of certain
transactions involving foreign securities, currencies, tax operating losses and
withholding taxes for the year ended May 31, 2000. Net investment income, net
realized gains and net assets were not affected by this change.
Note 2. Agreements
The Fund has a management agreement with Prudential Investments Fund Management
LLC ('PIFM'). Pursuant to this agreement, PIFM has responsibility for all
investment advisory services and supervises the subadvisor's performance of such
services. PIFM 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. PIFM pays for the services of PIC,
the cost of 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 PIFM is computed daily and payable monthly, at an
annual rate of 1% of the average daily net assets of the Fund.
The Fund has a distribution agreement with Prudential Investment
Management Services LLC ('PIMS'), which acts as the distributor of the Class A,
Class B, Class C and Class Z shares of the Fund. The Fund compensates PIMS for
distributing and servicing the Fund's Class A, Class B and Class C shares,
pursuant to a plan 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. No distribution or service fees are paid to PIMS as distributor
of the Class Z shares of the Fund.
Pursuant to the Class A, B and C Plans, the Fund compensates PIMS for its
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 C shares, respectively.
Effective May 3, 2000 such expenses for the Fund were .25 of 1%, of the average
daily net assets of the Class A, B and C shares. Prior to May 3, 2000, such
expenses under the Plans were .25 of 1%, 1% and 1% of the average daily net
assets of the Class A, Class B and Class C shares, respectively.
PIMS has advised the Fund that it received approximately $26,700 and
$1,500 in front-end sales charges resulting from sales of Class A and Class C
shares, respectively, during the year ended May 31, 2000. From these fees, PIMS
paid such sales
27
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
charges to dealers, which in turn paid commissions to salespersons and incurred
other distribution costs.
PIMS has advised the Fund that for the year ended May 31, 2000, it
received approximately $78,400 and $100 in contingent deferred sales charges
imposed upon redemptions by certain Class B and Class C shareholders,
respectively.
PIC, PIFM and PIMS are wholly owned subsidiaries of The Prudential
Insurance Company of America.
The Fund, along with other affiliated registered investment companies (the
'Funds'), entered into a syndicated credit agreement ('SCA') with an
unaffiliated lender. The maximum commitment under the SCA is $1 billion.
Interest on any such borrowings will be at market rates. The purpose of the
agreement is to serve as an alternative source of funding for capital share
redemptions. The Funds pay a commitment fee at an annual rate of .080 of 1% of
the unused portion of the credit facility. The commitment fee is accrued and
paid quarterly on a pro rata basis by the Funds. The expiration date of the SCA
is March 9, 2001. Prior to March 9, 2000, the commitment fee was .065 of 1% of
the unused portion of the credit facility. The Fund did not borrow any amounts
pursuant to the SCA during the year ended May 31, 2000.
Note 3. Other Transactions With Affiliates
Prudential Mutual Fund Services LLC ('PMFS'), a wholly owned subsidiary of PIFM,
serves as the Fund's transfer agent and during the year ended May 31, 2000, the
Fund incurred fees of approximately $223,400 for the services of PMFS. As of May
31, 2000, approximately $18,500 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 nonaffiliates.
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments,
for the year ended May 31, 2000 aggregated $145,480,395 and $166,002,427,
respectively.
The federal income tax basis of the Fund's investments at May 31, 2000 was
$71,360,250 and accordingly, net unrealized appreciation for federal income tax
purposes was $4,650,127 (gross unrealized appreciation--$12,743,623; gross
unrealized depreciation--$8,093,496).
For federal income tax purposes, the Fund had a capital loss carryforward
of approximately $12,065,000, of which the entire amount was utilized as of May
31, 2000. The Fund elected to treat net currency losses of approximately
$501,000
28
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
incurred in the seven month period ended May 31, 2000 as having occurred in the
following fiscal year.
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, 2000, the Fund had an
.09% undivided interest in the repurchase agreements in the joint account. The
undivided interest for the Fund represented $795,000 in principal amount. As of
such date, each repurchase agreement in the joint account and the value of the
collateral therefore were as follows:
ABN AMRO Incorporated, 6.37%, in the principal amount of $110,000,000,
repurchase price $110,019,464, due 6/1/00. The value of the collateral including
accrued interest was $112,200,491.
Bear, Stearns & Co. Inc., 6.37%, in the principal amount of $130,000,000,
repurchase price $130,023,003, due 6/1/00. The value of the collateral including
accrued interest was $133,856,194.
Chase Securities Inc., 6.15%, in the principal amount of $114,985,000,
repurchase price $115,004,643, due 6/1/00. The value of the collateral including
accrued interest was $117,289,066.
Credit Suisse First Boston Corp., 6.40%, in the principal amount of
$90,000,000, repurchase price $90,016,000, due 6/1/00. The value of the
collateral including accrued interest was $93,252,694.
Salomon Smith Barney, Inc., 6.38%, in the principal amount of
$220,000,000, repurchase price $220,038,989, due 6/1/00. The value of the
collateral including accrued interest was $224,578,626.
Warburg Dillon Reed LLC, 6.20%, in the principal amount of $200,000,000,
repurchase price $200,034,444, due 6/1/00. The value of the collateral including
accrued interest was $204,004,940.
Note 6. Capital
The Fund offers Class A, Class B, Class C and Class Z 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 front-end
sales charge of 1% and a contingent deferred sales charge of 1% during the first
18 months. Class B shares will automatically convert to Class A shares on a
quarterly basis approximately seven
29
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
years after purchase. A special exchange privilege is also available for
shareholders who qualify to purchase Class A shares at net asset value. Class Z
shares are not subject to any sales or redemption charge and are offered
exclusively for sale to a limited group of investors.
The Fund has authorized 500 million shares of common stock at $.01 par
value per share equally divided into four classes, designated Class A, Class B,
Class C and Class Z common stock.
Transactions in shares of common stock were as follows:
<TABLE>
<CAPTION>
Class A Shares [ZW]
Amount
------------------------------------------------------------ ---------- [ZW]
------------
<S> <C> <C>
Year ended May 31, 2000:
Shares sold 3,408,423 $ [ZW]
57,571,896
Shares reacquired (3,816,731) [ZW]
(64,857,599)
---------- [ZW]
------------
Net decrease in shares outstanding before conversion (408,308) [ZW]
(7,285,703)
Shares issued upon conversion from Class B 197,069 [ZW]
3,333,863
---------- [ZW]
------------
Net decrease in shares outstanding (211,239) $ [ZW]
(3,951,840)
---------- [ZW]
------------
---------- [ZW]
------------
Year ended May 31, 1999:
Shares sold 1,307,033 $ [ZW]
17,119,393
Shares issued in reinvestment of distributions 125,209 [ZW]
1,518,783
Shares reacquired (2,413,140) [ZW]
(31,601,691)
---------- [ZW]
------------
Net decrease in shares outstanding before conversion (980,898) [ZW]
(12,963,515)
Shares issued upon conversion from Class B 229,265 [ZW]
3,092,944
---------- [ZW]
------------
Net decrease in shares outstanding (751,633) $ [ZW]
(9,870,571)
---------- [ZW]
------------
---------- [ZW]
------------
<CAPTION>
Class B
------------------------------------------------------------
<S> <C> <C>
Year ended May 31, 2000:
Shares sold 1,193,626 $ [ZW]
17,448,044
Shares reacquired (1,741,185) [ZW]
(25,355,226)
---------- [ZW]
------------
Net decrease in shares outstanding before conversion (547,559) [ZW]
(7,907,182)
Shares reacquired upon conversion into Class A (218,729) [ZW]
(3,333,863)
---------- [ZW]
------------
Net decrease in shares outstanding (766,288) [ZW]
$(11,241,045)
---------- [ZW]
------------
---------- [ZW]
------------
Year ended May 31, 1999:
Shares sold 1,636,557 $ [ZW]
19,242,095
Shares issued in reinvestment of distributions 231,285 [ZW]
2,544,131
Shares reacquired (3,767,958) [ZW]
(44,643,135)
---------- [ZW]
------------
Net decrease in shares outstanding before conversion (1,900,116) [ZW]
(22,856,909)
Shares reacquired upon conversion into Class A (251,572) [ZW]
(3,092,944)
---------- [ZW]
------------
Net decrease in shares outstanding (2,151,688) [ZW]
$(25,949,853)
---------- [ZW]
------------
---------- [ZW]
------------
</TABLE>
30
<PAGE>
Prudential Global Genesis Fund, Inc.
Notes to Financial Statements Cont'd.
<TABLE>
<CAPTION>
Class C Shares [ZW]
Amount
------------------------------------------------------------ ---------- [ZW]
------------
Year ended May 31, 2000:
<S> <C> <C>
Shares sold 24,390 $ [ZW]
394,459
Shares reacquired (24,274) [ZW]
(388,480)
---------- [ZW]
------------
Net increase in shares outstanding 116 [ZW]
$ 5,979
---------- [ZW]
------------
---------- [ZW]
------------
Year ended May 31, 1999:
Shares sold 19,424 $ [ZW]
223,833
Shares issued in reinvestment of distributions [ZW]
3,823 42,055
Shares reacquired (44,892) [ZW]
(538,422)
---------- [ZW]
------------
Net decrease in shares outstanding (21,645) $ [ZW]
(272,534)
---------- [ZW]
------------
---------- [ZW]
------------
<CAPTION>
Class Z
------------------------------------------------------------
<S> <C> <C>
Year ended May 31, 2000:
Shares sold 49,449 $ [ZW]
849,056
Shares reacquired (29,221) [ZW]
(544,006)
---------- [ZW]
------------
Net increase in shares outstanding 20,228 $ [ZW]
305,050
---------- [ZW]
------------
---------- [ZW]
------------
Year ended May 31, 1999:
Shares sold 19,195 $ [ZW]
249,803
Shares issued in reinvestment of distributions [ZW]
844 10,381
Shares reacquired (48,824) [ZW]
(647,605)
---------- [ZW]
------------
Net decrease in shares outstanding (28,785) $ [ZW]
(387,421)
---------- [ZW]
------------
---------- [ZW]
------------
</TABLE>
Note 7. Proposed Reorganization
On May 2, 2000, the Directors' of the Fund approved an Agreement and Plan of
Reorganization (the 'Plan'), which provides for the transfer of all of the
assets of Prudential Global Genesis Fund, Inc. to Prudential World Fund, Inc. -
Prudential Global Growth Fund in exchange for Class A, B, C and Z shares of the
Global Growth Fund and the Global Growth Fund's assumption of the liabilities of
the Global Genesis Fund.
The Plan is subject to approval by the shareholders of the Global Genesis
Fund at a shareholder meeting scheduled in September 2000. If the Plan is
approved, it is expected that the reorganization will take place shortly
thereafter. The Global Genesis Fund and the Global Growth Fund will each bear
their pro-rata share of the costs of the reorganization, including cost of proxy
solicitation.
31
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights
<TABLE>
<CAPTION>
Class A
[ZW]
---------------
Year Ended
May 31, [ZW]
2000(b)
----------------------------------------------------------------------------------------
<S> [ZW]
<C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of year $ 13.68
[ZW]
---------------
Income from investment operations
Net investment income (loss) (.19)
Net realized and unrealized gain (loss) on investment and
foreign currency transactions 3.74
[ZW]
---------------
Total from investment operations 3.55
[ZW]
---------------
Less distributions
Distributions in excess of net investment income --
Distributions from net realized gain on investments --
[ZW]
---------------
Total distributions --
[ZW]
---------------
Net asset value, end of year $ 17.23
[ZW]
---------------
[ZW]
---------------
TOTAL RETURN(c): 25.95%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000) $34,889
Average net assets (000) $35,738
Ratios to average net assets:
Expenses, including distribution and service (12b-1) fees 2.13%
Expenses, excluding distribution and service (12b-1) fees 1.88%
Net investment income (loss) (1.14)%
For Class A, B, C and Z shares:
Portfolio turnover rate 184%
</TABLE>
------------------------------
(a) Net of expense subsidies and/or fee waivers.
(b) Calculated based upon average shares outstanding by class.
(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 year reported and includes reinvestment of dividends and
distributions.
32 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class A
-------------------------------------------------------------------------------------
Year Ended May 31,
-------------------------------------------------------------------------------------
1999(b) 1998 1997 1996(b)
-------------------------------------------------------------------------------------
<S> <C> <C> [ZW]
<C> <C>
$ 15.82 $ 21.30 $ 21.74 $ 18.44
-------- -------- -------- --------
(.10) (.20) (.14) .05(a)
(1.44) 1.37 1.45 3.34
-------- -------- -------- --------
(1.54) 1.17 1.31 3.39
-------- -------- -------- --------
-- -- -- (.09)
(.60) (6.65) (1.75) --
-------- -------- -------- --------
(.60) (6.65) (1.75) (.09)
-------- -------- -------- --------
$ 13.68 $ 15.82 $ 21.30 $ 21.74
-------- -------- -------- --------
-------- -------- -------- --------
(9.25)% 9.81% 6.74% 18.41%
$ 30,578 $ 47,259 $ 57,032 $ 47,617
$ 35,179 $ 50,309 $ 47,563 $ 45,070
2.03% 1.88% 1.91% 1.79%(a)
1.78% 1.63% 1.66% 1.54%(a)
(.77)% (.71)% (.49)% .26%(a)
156% 198% 60% 44%
</TABLE>
See Notes to Financial Statements 33
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class B
[ZW]
---------------
Year Ended
May 31, [ZW]
2000(b)
----------------------------------------------------------------------------------------
<S> [ZW]
<C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of year $ 12.36
[ZW]
---------------
Income from investment operations
Net investment (loss) (.27)
Net realized and unrealized gain (loss) on investment and
foreign currency transactions 3.37
[ZW]
---------------
Total from investment operations 3.10
[ZW]
---------------
Less distributions
Distributions in excess of net investment income --
Distributions from net realized gain on investments --
[ZW]
---------------
Total distributions --
[ZW]
---------------
Net asset value, end of year $ 15.46
[ZW]
---------------
[ZW]
---------------
TOTAL RETURN(c): 25.08%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000) $44,323
Average net assets (000) $47,120
Ratios to average net assets:
Expenses, including distribution and service (12b-1) fees 2.82%
Expenses, excluding distribution and service (12b-1) fees 1.88%
Net investment (loss) (1.83)%
</TABLE>
------------------------------
(a) Net of expense subsidies and/or fee waivers.
(b) Calculated based upon average shares outstanding by class.
(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 year reported and includes reinvestment of dividends and
distributions.
34 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class B
-------------------------------------------------------------------------------------
Year Ended May 31,
-------------------------------------------------------------------------------------
1999(b) 1998 1997 1996(b)
-------------------------------------------------------------------------------------
<S> <C> <C> [ZW]
<C> <C>
$ 14.47 $ 20.18 $ 20.87 $ 17.84
-------- ---------------- ---------------- ----------------
(.18) (.26) (.33) (.09)(a)
(1.33) 1.20 1.39 3.21
-------- ---------------- ---------------- ----------------
(1.51) .94 1.06 3.12
-------- ---------------- ---------------- ----------------
-- -- -- (.09)
(.60) (6.65) (1.75) --
-------- ---------------- ---------------- ----------------
(.60) (6.65) (1.75) (.09)
-------- ---------------- ---------------- ----------------
$ 12.36 $ 14.47 $ 20.18 $ 20.87
-------- ---------------- ---------------- ----------------
-------- ---------------- ---------------- ----------------
(9.92)% 9.04% 5.83% 17.51%
$ 44,890 $ 83,669 $120,067 $155,292
$ 55,679 $101,836 $133,073 $154,566
2.78% 2.63% 2.66% 2.54%(a)
1.78% 1.63% 1.66% 1.54%(a)
(1.51)% (1.48)% (1.26)% (.48)%(a)
</TABLE>
See Notes to Financial Statements 35
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class C
[ZW]
---------------
Year Ended
May 31, [ZW]
2000(b)
----------------------------------------------------------------------------------------
<S> [ZW]
<C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of year $ 12.36
-------
Income from investment operations
Net investment income (loss) (.27)
Net realized and unrealized gain (loss) on investment and
foreign currency transactions 3.37
-------
Total from investment operations 3.10
-------
Less distributions
Distributions in excess of net investment income --
Distributions from net realized gain on investments --
-------
Total distributions --
-------
Net asset value, end of year $ 15.46
-------
-------
TOTAL RETURN(c): 25.08%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000) $ 987
Average net assets (000) $ 933
Ratios to average net assets:
Expenses, including distribution and service (12b-1) fees 2.82%
Expenses, excluding distribution and service (12b-1) fees 1.88%
Net investment (loss) (1.82)%
</TABLE>
------------------------------
(a) Net of expense subsidies and/or fee waivers.
(b) Calculated based upon average shares outstanding by class.
(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 year reported and includes reinvestment of dividends and
distributions.
36 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class C
-------------------------------------------------------------------------------------
Year Ended May 31,
-------------------------------------------------------------------------------------
1999(b) 1998 1997 1996(b)
-------------------------------------------------------------------------------------
<S> <C> <C> [ZW]
<C> <C>
$14.47 $20.18 $20.87 $17.84
------- ------- ------- -------
(.18) (.26) (.27) (.08)(a)
(1.33) 1.20 1.33 3.20
------- ------- ------- -------
(1.51) .94 1.06 3.12
------- ------- ------- -------
-- -- -- (.09)
(.60) (6.65) (1.75) --
------- ------- ------- -------
(.60) (6.65) (1.75) (.09)
------- ------- ------- -------
$12.36 $14.47 $20.18 $20.87
------- ------- ------- -------
------- ------- ------- -------
(9.92)% 9.04% 5.83% 17.51%
$ 787 $1,234 $1,874 $2,275
$ 895 $1,739 $1,958 $1,809
2.78% 2.63% 2.66% 2.54%(a)
1.78% 1.63% 1.66% 1.54%(a)
(1.53)% (1.43)% (1.24)% (.44)%(a)
</TABLE>
See Notes to Financial Statements 37
<PAGE>
Prudential Global Genesis Fund, Inc.
Financial Highlights Cont'd.
<TABLE>
<CAPTION>
Class Z
[ZW]
----------------------------------------------------
[ZW]
September 16,
[ZW]
1996(c)
Year Ended May [ZW]
31, Through
[ZW]
---------------------------------- May 31,
2000(a) 1999(a) [ZW]
1998 1997
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> [ZW]
<C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period $13.89 $ 16.01 $ [ZW]
21.39 $ 20.46
---------- ------- ------- [ZW]
-------------
Income from investment operations
Net investment income (loss) (.16) (.06) [ZW]
(.38) .03
Net realized and unrealized gain
(loss) on investment and
foreign currency transactions 3.81 (1.46) [ZW]
1.65 2.65
---------- ------- ------- [ZW]
-------------
Total from investment
operations 3.65 (1.52) [ZW]
1.27 2.68
---------- ------- ------- [ZW]
-------------
Less distributions
Distributions from net realized
gain on investments -- (.60) [ZW]
(6.65) (1.75)
---------- ------- ------- [ZW]
-------------
Total distributions -- (.60) [ZW]
(6.65) (1.75)
---------- ------- ------- [ZW]
-------------
Net asset value, end of period $17.54 $ 13.89 $ [ZW]
16.01 $ 21.39
---------- ------- ------- [ZW]
-------------
---------- ------- ------- [ZW]
-------------
TOTAL RETURN(b): 26.21% (9.01)% [ZW]
10.22% 13.90%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) $ 692 $ 267 $ [ZW]
768 $ 603
Average net assets (000) $ 585 $ 388 $ [ZW]
662 $ 188
Ratios to average net assets:
Expenses, including
distribution and service
(12b-1) fees 1.88% 1.78% [ZW]
1.63% 1.66%(d)
Expenses, excluding
distribution and service
(12b-1) fees 1.88% 1.78% [ZW]
1.63% 1.66%(d)
Net investment loss (.91)% (.46)% [ZW]
(.43)% (.87)%(d)
</TABLE>
------------------------------
(a) Calculated based upon average shares outstanding.
(b) 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 one full year are not
annualized.
(c) Commencement of offering of Class Z shares.
(d) Annualized.
38 See Notes to Financial Statements
<PAGE>
Prudential Global Genesis Fund, Inc.
Report of Independent Accountants
To the Board of Directors and Shareholders of
Prudential Global Genesis 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 Genesis Fund,
Inc. (the 'Fund') at May 31, 2000, 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 periods
presented, in conformity with accounting principles generally accepted in the
United States. These financial statements and financial highlights (hereafter
referred to as 'financial statements') are the responsibility of the 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 auditing standards generally accepted in the
United States, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at May 31, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
As described in Note 7 to the financial statements, on May 2, 2000, the Board of
Directors of the Fund approved an Agreement and Plan of Reorganization, subject
to shareholder approval, whereby the Fund would be merged into Prudential World
Fund, Inc. - Prudential Global Growth Fund.
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York
July 20, 2000
See Notes to Financial Statements 39
<PAGE>
Prudential Global Genesis Fund, Inc.
Prudential Mutual Funds
Prudential offers a broad range of mutual funds designed
to meet your individual needs. For information about
these funds, contact your financial adviser or call us at
(800) 225-1852. Read the prospectus carefully before you
invest or send money.
STOCK FUNDS
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Strategic Partners Focused Growth Fund
Target Funds
Large Capitalization Growth Fund
Large Capitalization Value Fund
The Prudential Investment Portfolios, Inc.
Prudential Jennison Growth Fund
Small- to Mid-Capitalization Stock Funds
Nicholas-Applegate Fund, Inc.
Nicholas-Applegate Growth Equity Fund
Prudential Small Company Fund, Inc.
Prudential Tax-Managed Small-Cap Fund, Inc.
Prudential U.S. Emerging Growth Fund, Inc.
Target Funds
Small Capitalization Growth Fund
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The Prudential Investment Portfolios, Inc.
Prudential Jennison Equity Opportunity Fund
Sector Stock Funds
Prudential Natural Resources Fund, Inc.
Prudential Real Estate Securities Fund
Prudential Sector Funds, Inc.
Prudential Financial Services Fund
Prudential Health Sciences Fund
Prudential Technology Fund
Prudential Utility Fund
Global/International Stock Funds
Global Utility Fund, Inc.
Prudential Europe Growth Fund, Inc.
Prudential Pacific Growth Fund, Inc.
Prudential World Fund, Inc.
Prudential Global Growth Fund
Prudential International Value Fund
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Target Funds
International Equity Fund
BALANCED/ALLOCATION FUNDS
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Conservative Growth Fund
Moderate Growth Fund
High Growth Fund
The Prudential Investment Portfolios, Inc.
Prudential Active Balanced Fund
<PAGE>
www.prudential.com (800) 225-1852
Annual Report May 31, 2000
BOND FUNDS
Taxable Bond Funds
Prudential Government Income Fund, Inc.
Prudential Government Securities Trust
Short-Intermediate Term Series
Prudential High Yield Fund, Inc.
Prudential High Yield Total Return Fund, Inc.
Prudential Short-Term Corporate Bond Fund, Inc.
Income Portfolio
Prudential Total Return Bond Fund, Inc.
Target Funds
Total Return Bond Fund
Tax-Free Bond Funds
Prudential California Municipal Fund
California Series
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Prudential Municipal Bond Fund
High Income Series
Insured Series
Prudential Municipal Series Fund
Florida Series
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New Jersey Series
New York Series
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Ohio Series
Pennsylvania Series
Prudential National Municipals Fund, Inc.
Global/International Bond Funds
Prudential Global Total Return Fund, Inc.
Prudential International Bond Fund, Inc.
MONEY MARKET FUNDS
Taxable Money Market Funds
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Liquid Assets Fund
National Money Market Fund
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Money Market Series
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Prudential Institutional Liquidity Portfolio, Inc.
Institutional Money Market Series
Prudential MoneyMart Assets, Inc.
Prudential Special Money Market Fund, Inc.
Money Market Series
Tax-Free Money Market Funds
Prudential California Municipal Fund
California Money Market Series
Prudential Municipal Series Fund
Connecticut Money Market Series
Massachusetts Money Market Series
New Jersey Money Market Series
New York Money Market Series
Prudential Tax-Free Money Fund, Inc.
Other Money Market Funds
Command Government Fund
Command Money Fund
Command Tax-Free Fund
<PAGE>
Prudential Global Genesis Fund, Inc.
Class A Growth of a $10,000 Investment
(GRAPH)
Average Annual Total Returns as of 5/31/00
One Year Five Years Ten Years Since Inception
With Sales Charge 19.65% 8.55% 8.55% 8.41%
Without Sales Charge 25.95% 9.67% 9.11% 8.95%
Past performance is not indicative of future results.
Principal and investment return will fluctuate so that an
investor's shares, when redeemed, may be worth more or
less than their original cost. The graph
compares a $10,000 investment in the Prudential Global
Genesis Fund, Inc. (Class A shares) with a
similar investment in the Morgan Stanley Capital
International World Index (MSCI World Index) by
portraying the initial account value at the beginning of
the ten-year period for Class A shares, and the account
value at the end of the current fiscal year (May 31,
2000), as measured on a quarterly basis, beginning in May
1990 for Class A shares. For purposes of the graph, and
unless otherwise indicated, it has been assumed that (a)
the maximum applicable front-end sales charge was
deducted from the initial $10,000 investment in Class A
shares; (b) all recurring fees (including management
fees) were deducted; and (c) all dividends and
distributions were reinvested. The best and worst year
information within the graph is designed to give you an
idea of how much the Fund's returns can fluctuate from
year to year by measuring the best and worst calendar
years for the past ten years in terms of total annual
return.
The MSCI World Index is a weighted index comprising
approximately 1,500 companies listed on the stock
exchanges of the United States, Europe, Canada,
Australia, New Zealand, and the Far East. The combined
market capitalization of these companies represents
approximately 60% of the aggregate market value of the
stock exchanges in the countries comprising the MSCI
World Index. The Index is unmanaged, and the total return
includes the reinvestment of all dividends, but does not
include the effect of sales charges or operating expenses
of a mutual fund. The securities in the Index may be very
different from those in the Fund. The total returns of
the Index would be lower if they included the effect of
any sales charges.
The Index is not the only one that may be used to
characterize performance of Global Stock funds. Other
indexes may portray different comparative performance.
Investors cannot invest directly in an index.
This graph is furnished to you in accordance with SEC
regulations.
<PAGE>
www.prudential.com (800) 225-1852
Class B Growth of a $10,000 Investment
(GRAPH)
Average Annual Total Returns as of 5/31/00
One Year Five Years Ten Years Since Inception
With Sales Charge 20.08% 8.70% 8.28% 9.38%
Without Sales Charge 25.08% 8.85% 8.28% 9.38%
Past performance is not indicative of future results.
Principal and investment return will fluctuate so that an
investor's shares, when redeemed, may be worth more or
less than their original cost. The graph compares a
$10,000 investment in the Prudential Global Genesis Fund,
Inc. (Class B shares) with a similar investment in the
Morgan Stanley Capital International World Index (MSCI
World Index) by portraying the initial account value at
the beginning of the ten-year period for Class B shares,
and the account value at the end of the current fiscal
year (May 31, 2000), as measured on a quarterly basis,
beginning in May 1990 for Class B shares. For purposes of
the graph, and unless otherwise indicated, it has been
assumed that (a) the maximum applicable contingent
deferred sales charge was deducted from the value of the
investment in Class B shares, assuming full redemption on
May 31, 2000; (b) all recurring fees (including
management fees) were deducted; and (c) all dividends and
distributions were reinvested. Class B shares will
automatically convert to Class A shares, on a quarterly
basis, beginning approximately seven years after
purchase. This conversion feature is not reflected in the
graph. The best and worst year information within the
graph is designed to give you an idea of how much the
Fund's returns can fluctuate from year to year by
measuring the best and worst calendar years for the past
ten years in terms of total annual return.
The MSCI World Index is a weighted index comprising
approximately 1,500 companies listed on the stock
exchanges of the United States, Europe, Canada,
Australia, New Zealand, and the Far East. The combined
market capitalization of these companies represents
approximately 60% of the aggregate market value of the
stock exchanges in the countries comprising the MSCI
World Index. The Index is unmanaged, and the total return
includes the reinvestment of all dividends, but does not
include the effect of sales charges or operating expenses
of a mutual fund. The securities in the Index may be very
different from those in the Fund. The total returns of
the Index would be lower if they included the effect of
any sales charges.
The Index is not the only one that may be used to
characterize performance of Global Stock funds. Other
indexes may portray different comparative performance.
Investors cannot invest directly in an index.
This graph is furnished to you in accordance with SEC
regulations.
<PAGE>
Prudential Global Genesis Fund, Inc.
Class C Growth of a $10,000 Investment
(GRAPH)
Average Annual Total Returns as of 5/31/00
One Year Five Years Ten Years Since Inception
With Sales Charge 22.83% 8.63% N/A 6.81%
Without Sales Charge 25.08% 8.85% N/A 7.00%
Past performance is not indicative of future results.
Principal and investment return will fluctuate so that an
investor's shares, when redeemed, may be worth more or
less than their original cost. The graph compares a
$10,000 investment in the Prudential Global Genesis Fund,
Inc. (Class C shares) with a similar investment in the
Morgan Stanley Capital International World Index (MSCI
World Index) by portraying the initial account value at
the commencement of operations of Class C shares, and the
account value at the end of the current fiscal year (May
31, 2000), as measured on a quarterly basis, beginning in
August 1994 for Class C shares. For purposes of the
graph, and unless otherwise indicated, it has been
assumed that (a) the maximum applicable front-end sales
charge was deducted from the initial $10,000 investment
in Class C shares; (b) the maximum applicable contingent
deferred sales charge was deducted from the value of the
investment in Class C shares, assuming full redemption on
May 31, 2000; (c) all recurring fees (including
management fees) were deducted; and (d) all dividends and
distributions were reinvested. The best and worst year
information within the graph is designed to give you an
idea of how much the Fund's returns can fluctuate from
year to year by measuring the best and worst calendar
years in terms of total annual return.
The MSCI World Index is a weighted index comprising
approximately 1,500 companies listed on the stock
exchanges of the United States, Europe, Canada,
Australia, New Zealand, and the Far East. The combined
market capitalization of these companies represents
approximately 60% of the aggregate market value of the
stock exchanges in the countries comprising the MSCI
World Index. The Index is unmanaged, and the total return
includes the reinvestment of all dividends, but does not
include the effect of sales charges or operating expenses
of a mutual fund. The securities in the Index may be very
different from those in the Fund. The total returns of
the Index would be lower if they included the effect of
any sales charges.
The Index is not the only one that may be used to
characterize performance of Global Stock funds. Other
indexes may portray different comparative performance.
Investors cannot invest directly in an index.
This graph is furnished to you in accordance with SEC
regulations.
<PAGE>
www.prudential.com (800) 225-1852
Class Z Growth of a $10,000 Investment
(GRAPH)
Average Annual Total Returns as of 5/31/00
One Year Five Years Ten Years Since Inception
With Sales Charge 26.21% N/A N/A 10.38%
Without Sales Charge 26.21% N/A N/A 10.38%
Past performance is not indicative of future results.
Principal and investment return will fluctuate so that an
investor's shares, when redeemed, may be worth more or
less than their original cost. The graph compares a
$10,000 investment in the Prudential Global Genesis Fund,
Inc. (Class Z shares) with a similar investment in the
Morgan Stanley Capital International World Index (MSCI
World Index) by portraying the initial account value at
the commencement of operations of Class Z shares, and the
account value at the end of the current fiscal year (May
31, 2000), as measured on a quarterly basis, beginning in
September 1996 for Class Z shares. For purposes of the
graph, and unless otherwise indicated, it has been
assumed that (a) all recurring fees (including management
fees) were deducted, and (b) all dividends and
distributions were reinvested. Class Z shares are not
subject to a sales charge or distribution and service
(12b-1) fees. The best and worst year information within
the graph is designed to give you an idea of how much the
Fund's returns can fluctuate from year to year by
measuring the best and worst calendar years in terms of
total annual return.
The MSCI World Index is a weighted index comprising
approximately 1,500 companies listed on the stock
exchanges of the United States, Europe, Canada,
Australia, New Zealand, and the Far East. The combined
market capitalization of these companies represents
approximately 60% of the aggregate market value of the
stock exchanges in the countries comprising the MSCI
World Index. The Index is unmanaged, and the total return
includes the reinvestment of all dividends, but does not
include the effect of sales charges or operating expenses
of a mutual fund. The securities in the Index may be very
different from those in the Fund. The total returns of
the Index would be lower if they included the effect of
any sales charges.
The Index is not the only one that may be used to
characterize performance of Global Stock funds. Other
indexes may portray different comparative performance.
Investors cannot invest directly in an index.
This graph is furnished to you in accordance with SEC
regulations.
<PAGE>
For More Information
Prudential Mutual Funds
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
(800) 225-1852
Visit Prudential's web site at:
http://www.prudential.com
Directors
Delayne Dedrick Gold
Robert F. Gunia
Robert E. LaBlanc
David R. Odenath, Jr.
Robin B. Smith
Stephen Stoneburn
John R. Strangfeld
Nancy H. Teeters
Clay T. Whitehead
Officers
John R. Strangfeld, President
Robert F. Gunia, Vice President
David R. Odenath, Jr., Vice President
Grace C. Torres, Treasurer
Robert C. Rosselot, Secretary
William V. Healey, Assistant Secretary
Manager
Prudential Investments Fund Management LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
Investment Adviser
The Prudential Investment Corporation
Prudential Plaza
Newark, NJ 07102-3777
Distributor
Prudential Investment Management Services LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
Custodian
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
Transfer Agent
Prudential Mutual Fund Services LLC
194 Wood Avenue South
Iselin, NJ 08830
Independent Accountants
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
Legal Counsel
Sullivan & Cromwell
125 Broad Street
New York, NY 10004
Fund Symbols NASDAQ CUSIP
Class A PRAGX 744333105
Class B PRGGX 744333204
Class C PCGGX 744333303
Class Z PZGGX 744333402
MF136E
(LOGO) Printed on Recycled Paper
