WARBURG PINCUS ADVISOR FUNDS APRIL 30, 2000
EMERGING GROWTH FUND
SMALL COMPANY VALUE FUND
S
SEMIANNUAL REPORT
(Unaudited)
More complete information about the Funds, including charges and expenses, is
provided in the Prospectus, which must precede or accompany this document and
which should be read carefully before investing. You may obtain additional
copies by calling 800-222-8977 or by writing to Warburg Pincus Advisor Funds,
P.O. Box 9030, Boston, MA 02205-9030.
[GRAPHIC OMITTED]
WARBURG PINCUS PINCUS PART OF CREDIT SUISSE ASSET MANAGEMENT
<PAGE>
FROM TIME TO TIME, THE FUNDS' INVESTMENT ADVISER AND CO-ADMINISTRATORS MAY WAIVE
SOME FEES AND/OR REIMBURSE SOME EXPENSES, WITHOUT WHICH PERFORMANCE WOULD BE
LOWER. WAIVERS AND/OR REIMBURSEMENTS ARE SUBJECT TO CHANGE.
RETURNS ARE HISTORICAL AND INCLUDE CHANGE IN SHARE PRICE AND REINVESTMENT OF
DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE CANNOT GUARANTEE FUTURE RESULTS.
RETURNS AND SHARE PRICE WILL FLUCTUATE, AND REDEMPTION VALUE MAY BE MORE OR LESS
THAN ORIGINAL COST.
THE VIEWS OF THE FUNDS' MANAGEMENT ARE AS OF THE DATE OF THE LETTERS AND
PORTFOLIO HOLDINGS DESCRIBED IN THIS DOCUMENT ARE AS OF APRIL 30, 2000; THESE
VIEWS ANDPORTFOLIO HOLDINGS MAY HAVE CHANGED SUBSEQUENT TO THESE DATES. NOTHING
IN THIS DOCUMENT IS A RECOMMENDATION TO PURCHASE OR SELL SECURITIES.
FUND SHARES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF CREDIT SUISSE ASSET
MANAGEMENT, LLC ("CSAM") OR ANY AFFILIATE, ARE NOT FDIC INSURED AND ARE NOT
GUARANTEED BY CSAM OR ANY AFFILIATE. FUND INVESTMENTS ARE SUBJECT TO INVESTMENT
RISKS, INCLUDING LOSS OF YOUR INVESTMENT.
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WARBURG PINCUS EMERGING GROWTH FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 2000
--------------------------------------------------------------------------------
June 20, 2000
Dear Shareholder:
For the six months ended April 30, 2000, the Advisor Class shares of Warburg
Pincus Emerging Growth Fund had a gain of 30.31%, vs. gains of 27.78% and
38.11%, respectively, for the Russell 2000 Growth Index1 and the Russell 2500
Growth Index2. The Fund's one-year return through April 30, 2000 was 47.73%. Its
five-year, 10-year and since-inception (on January 21, 1988) average annual
total returns through April 30, 2000 were 21.39%, 18.65% and 17.70%,
respectively.
The period was a solid one for the stocks targeted by the Fund (i.e., small-
and mid-cap stocks of companies offering higher-than-average profit growth),
both in absolute terms and compared to their large-cap counterparts. The group
was buoyed by optimism over the profit outlook for small- and mid-cap stocks and
by investors' continued enthusiasm for growth-oriented companies in general. To
be sure, emerging-growth stocks were volatile, particularly late in the period,
reflecting interest-rate uncertainties as well as concerns over valuations of
technology vs. non-technology companies.
The Fund had a competitive showing for the period, performing roughly in line
with its benchmarks. Aiding the Fund were good showings from a number of its
holdings, in particular its communications and technology stocks,
notwithstanding the turbulence witnessed in these areas.
We made no material changes to the Fund during the period with respect to
basic strategy, remaining focused on well-managed companies with significant
long-term growth potential. We continued to find a large number of such
companies within the technology area, broadly defined. Our positive view on
these companies remained based on several compelling forces, not the least of
which is the Internet's expanding use as a productivity-enhancing tool and as a
means of commerce. Specific software, electronic-component and
communications-services providers are well-positioned to benefit from this
trend, as are certain business-services companies, which remained
well-represented in the Fund. Elsewhere of note, we maintained significant
exposure to the energy and pharmaceutical sectors, where we continued to see
compelling growth stories and attractive valuations.
Looking ahead, we have a positive view on the prospects for small- and
mid-cap stocks, notwithstanding the likelihood of continued short-term
volatility. Barring a material slowdown in the U.S. economy, we feel that the
group's profit backdrop should remain, at minimum, supportive, given these
1
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WARBURG PINCUS EMERGING GROWTH FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 2000 (CONT'D)
--------------------------------------------------------------------------------
companies' domestically biased customer bases. Other factors that stand to
benefit emerging-growth stocks include a strong ongoing outsourcing trend, with
large companies delegating non-core functions to smaller, niche-type companies.
Set within this environment, our focus will remain on innovative, rapidly
growing companies we deem to have the best long-term prospects.
Elizabeth B. Dater Stephen J. Lurito
Co-Portfolio Manager Co-Portfolio Manager
INVESTING IN SMALL COMPANIES ENTAILS SPECIAL RISK CONSIDERATIONS. THESE ARE
DETAILED IN THE PROSPECTUS, WHICH SHOULD BE READ CAREFULLY BEFORE INVESTING.
----------
1 The Russell 2000 Growth Index is an unmanaged index (with no defined
investment objective) of those securities in the Russell 2000 Index with a
greater-than-average growth orientation. The Russell 2000 Growth Index
includes reinvestment of dividends, and is compiled by Frank Russell Company.
2 The Russell 2500 Growth Index measures the performance of those companies in
the Russell 2500 Index with higher price-to-book values and higher forecasted
growth rates. The Russell 2500 Index is composed of the 2,500 smallest
companies in the Russell 3000 Index, which measures the performance of the
3,000 largest U.S. companies based on total market capitalization. The
Russell 2500 Index represents approximately 22% of the total market
capitalization of the Russell 3000 Index.
2
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WARBURG PINCUS SMALL COMPANY VALUE FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 2000
--------------------------------------------------------------------------------
June 20, 2000
Dear Shareholder:
For the six months ended April 30, 2000, the Advisor Class shares of Warburg
Pincus Small Company Value Fund had a return of 12.79%, vs. returns of 18.72%
and 8.21%, respectively, for the Russell 2000 Index1 and the Russell 2000 Value
Index2. The Fund's one-year return through April 30, 2000 was 9.08%. Its
since-inception (on December 29, 1995) average annual total return through April
30, 2000 was 11.95%.
Small-capitalization stocks had good performance for the six months, both in
absolute terms and compared to their large-cap brethren, supported by a
favorable profit outlook for the group. However, these stocks, and the group's
growth-oriented technology names in particular, were quite volatile, reflecting
fears that a strong economy would put upward pressure on inflation and interest
rates. Volatility was especially sharp late in the period, with many growth
stocks (which paced the small-cap rally for the six months) suffering
double-digit pullbacks in April, a relatively good month for small-cap value
stocks.
Against this backdrop, the Fund had positive performance, outpacing the
Russell 2000 Value Index by a fair margin. The Fund benefited from some timely
stock selection, especially within the technology area. Other factors that aided
the Fund included its underweighting in the financial segment through much of
the period. Financial stocks lagged the broader small-cap market, hampered by
fears that the Federal Reserve would continue to raise interest rates (the Fed
raised rates three times during the six months).
We made no material change to the Fund in terms of basic strategy during the
period, remaining focused on identifying visible catalysts that can bring
favorable attention to underfollowed, relatively inexpensive small-cap stocks.
However, we made a few adjustments to the Fund's sector allocation. Most
noteworthy was our increased exposure to financial-services companies (broadly
defined to include banks and real-estate investment trusts). Our decision to
add, late in the period, was based on the increasingly compelling valuations we
saw here. It was also based on our belief that the Fed would take a "neutral"
stance on interest rates relatively soon (financial stocks have historically
tended to rebound ahead of peaks in rate cycles). Our particular emphasis was on
insurance and real-estate companies.
Another sector weighting we raised was health care. Many of these stocks
declined in 1998 and 1999 as "reimbursement" reductions (stemming from the
Balanced Budget Act of 1997) were phased in. We began to see value here late
last year, believing that political pressures would restore at least some of
3
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 2000 (CONT'D)
--------------------------------------------------------------------------------
the rate reduction. Indeed, such legislation was approved last November, and
further rate increases could be in the offing. Our focus remained on nursing
homes and hospitals, especially those with exposure to "acute care," or
long-term, customers. Rate reductions for acute-care patients were the sharpest,
and restored funding could therefore have the most positive impact on these
stocks. We continued to avoid health-maintenance organizations, reflecting our
ongoing concerns regarding the possible passage of "right to sue" legislation
and our general concerns over these stocks in an election year.
One weighting we lowered during the period was technology. We pared certain
holdings here on valuation considerations, while eliminating positions in
specific companies we deemed to have deteriorating fundamentals. We also
decreased our emphasis on the consumer-discretionary area, based on the Federal
Reserve's apparent desire to rein in consumer spending by raising interest
rates.
Looking ahead, we see grounds for optimism regarding the underfollowed stocks
targeted by the Fund. On the whole, value stocks are very compellingly priced
compared to growth stocks (especially within the small-cap arena), with
valuation discrepancies between the two groups remaining as wide as they have
been in nearly three decades. While this is no guarantee that value stocks will
see improved performance vs. growth stocks anytime soon, recent market
behavior--across the market-cap spectrum--suggests that investors have become
more cognizant of valuations and are broadening their scope. For our part, we
will remain focused not on cheap stocks per se, but on stocks we deem to be
fundamentally undervalued, given factors such as their underlying companies'
balance sheet health and earnings prospects.
Kyle F. Frey
Portfolio Manager
----------
1 The Russell 2000 Index is an unmanaged index (with no defined investment
objective) of approximately 2,000 small-cap stocks, includes reinvestment of
dividends, and is compiled by Frank Russell Company.
2 The Russell 2000 Value Index is an unmanaged index (with no defined
investment objective) of those companies in the Russell 2000 Index with lower
price-to-book and lower forecasted growth values. Note: In light of the
Fund's value-stock emphasis, the Fund has changed its performance benchmark
from the Russell 2000 Index to the Russell 2000 Value Index, effective May 2,
2000.
INVESTING IN SMALL COMPANIES ENTAILS SPECIAL RISK CONSIDERATIONS. THESE ARE
DETAILED IN THE PROSPECTUS, WHICH SHOULD BE READ CAREFULLY BEFORE INVESTING.
4
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WARBURG PINCUS EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------------ ------
COMMON STOCKS (92.5%)
BUILDING & BUILDING MATERIALS (0.6%)
Lennar Corp. 825,400 $ 15,373,075
--------------
BUSINESS SERVICES (6.6%)
New York Restaurant Group, Inc. (DAGGER) # 336,786 3,249,985
On Assignment, Inc. (DAGGER) 1,400,920 43,953,865
Paychex, Inc. 339,700 17,876,712
Phone.com, Inc. (DAGGER) 248,550 20,878,200
QRS Corp. (DAGGER) 394,400 13,015,200
SeaChange International, Inc. (DAGGER) 493,390 14,801,700
SunGard Data Systems, Inc. (DAGGER) 637,990 22,050,529
Sykes Enterprises, Inc. (DAGGER) 1,370 27,400
TMP Worldwide, Inc. (DAGGER) 374,550 24,486,206
--------------
160,339,797
--------------
COMMUNICATIONS & MEDIA (8.1%)
Backweb Technologies, Ltd. (DAGGER) 840,050 19,688,672
BreezeCom, Ltd. Series B (DAGGER) # 1,739,078 38,259,716
Ditech Communications Corp. 240,000 20,580,000
Foundry Networks, Inc. (DAGGER) 223,000 20,293,000
Hispanic Broadcasting Corp.(DAGGER) 219,813 22,214,851
Inktomi Corp. (DAGGER) 190,700 29,355,881
Insight Communications Co., Inc. (DAGGER) 246,400 5,020,400
Itxc Corp. (DAGGER) 264,550 7,093,247
Spanish Broadcasting System, Inc. (DAGGER) 815,000 15,230,312
Westwood One, Inc. 315,190 11,149,846
Youthstream Media Networks, Inc. (DAGGER) 1,245,344 7,939,068
--------------
196,824,993
--------------
COMPUTERS (8.0%)
Citrix Systems, Inc. (DAGGER) 729,350 44,535,934
Informix Corp. (DAGGER) 1,539,575 16,935,325
Marimba, Inc. (DAGGER) 70,550 1,397,772
Mercury Interactive Corp. (DAGGER) 432,875 38,958,750
Micromuse, Inc. (DAGGER) 60,000 5,887,500
National Instruments Corp. (DAGGER) 604,765 29,482,294
Network Appliance, Inc. (DAGGER) 218,675 16,168,283
Scitex Corp., Ltd. (DAGGER) 1,760,400 20,904,750
VERITAS Software Corp. (DAGGER) 200,000 21,453,125
Softcom, Inc.(DAGGER)# 454,545 999,999
--------------
196,723,732
--------------
CONSUMER SERVICES (1.5%)
DeVRY, Inc. (DAGGER) 1,007,321 23,986,831
ITT Educational Services, Inc. 679,050 12,138,019
--------------
36,124,850
--------------
ELECTRONICS (24.6%)
Altera Corp. (DAGGER) 196,500 20,092,125
Amkor Technology, Inc. 388,100 23,746,869
See Accompanying Notes to Financial Statements.
5
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WARBURG PINCUS EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------------ ------
COMMON STOCKS (CONT'D)
Analog Devices, Inc. (DAGGER) 325,000 $ 24,964,062
Avant! Corp. (DAGGER) 353,150 6,356,700
Broadcom Corp. Class A 128,400 22,132,950
Burr-Brown Corp. (DAGGER) 1,052,095 71,674,006
Celestica, Inc. - ADR(DAGGER) 683,000 37,266,187
Cognex Corp. (DAGGER) 661,000 37,594,375
DSP Group, Inc. (DAGGER) 500,500 35,598,062
JDS Uniphase Corp. (DAGGER) 257,950 26,762,312
KLA-Tencor Corp. (DAGGER) 129,650 9,707,544
Lattice Semiconductor Corp. (DAGGER) 594,290 40,040,289
Maxim Integrated Products, Inc. (DAGGER) 1,317,390 85,383,339
NVIDIA Corp. (DAGGER) 332,100 29,598,413
PMC-Sierra, Inc. (DAGGER) 189,825 36,422,672
RF Micro Devices, Inc. 138,800 14,443,875
Sawtek, Inc. (DAGGER) 543,200 25,971,750
Vishay Intertechnology, Inc. (DAGGER) 621,205 52,103,569
--------------
599,859,099
--------------
ENERGY (2.0%)
Apache Corp. 455,000 22,039,063
Chaparral Resources, Inc.(DAGGER) # 13,889 109,375
Devon Energy Corp. 330,000 15,901,875
Noble Affiliates, Inc. 294,000 10,602,375
--------------
48,652,688
--------------
FINANCIAL SERVICES (4.3%)
Bear Stearns Cos., Inc. 500,000 21,437,500
Countrywide Credit Industries, Inc. 200,000 5,525,000
Enhance Financial Services Group, Inc. 790,450 8,003,306
Indymac Mortgage Holdings, Inc. (DAGGER) 1,848,900 24,151,256
MBIA, Inc. 150,000 7,415,625
Reinsurance Group of America, Inc. 1,139,095 28,334,988
XL Capital, Ltd. Class A 220,000 10,477,500
--------------
105,345,175
--------------
FOOD, BEVERAGES & TOBACCO (0.2%)
Ben & Jerry's Homemade, Inc. Class A (DAGGER) 131,500 5,695,594
--------------
HEALTHCARE (4.5%)
Columbia/HCA Healthcare Corp. 460,000 13,081,250
Focal, Inc. (DAGGER) 1 6
HEALTHSOUTH Corp. (DAGGER) 2,000,000 16,125,000
IVAX Corp. 1,232,950 33,752,006
PE Corp - PE Biosystems Group 346,125 20,767,500
St. Jude Medical, Inc. 200,000 6,237,500
Tenet Healthcare Corp. (DAGGER) 739,000 18,844,500
Women First Healthcare, Inc. (DAGGER)# 274,500 514,688
--------------
109,322,450
--------------
See Accompanying Notes to Financial Statements.
6
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------------ ------
COMMON STOCKS (CONT'D)
OIL SERVICES (7.3%)
Cooper Cameron Corp. (DAGGER) 729,990 $ 54,749,250
ENSCO International, Inc. 47,000 1,559,813
Nabors Industries, Inc. (DAGGER) 1,298,475 51,208,608
Noble Drilling Corp. (DAGGER) 567,490 22,664,132
Pride International, Inc. (DAGGER) 1,113,100 25,183,888
Smith International, Inc. (DAGGER) 305,925 23,250,300
--------------
178,615,991
--------------
PHARMACEUTICALS (4.6%)
Biovail Corp. (DAGGER) 556,550 26,540,478
Elan Corp. PLC ADR (DAGGER) 410,000 17,578,750
Immunex Corp. (DAGGER) 355,000 13,978,125
Pharmacopeia, Inc. (DAGGER) 254,400 10,462,200
Sepracor, Inc. (DAGGER) 299,500 27,554,000
Watson Pharmaceuticals, Inc. (DAGGER) 377,775 16,976,264
--------------
113,089,817
--------------
REAL ESTATE (1.2%)
AMB Property Corp. 291,000 6,420,188
Apartment Investment & Management Co. Class A 300,000 11,925,000
Boston Properties, Inc. 300,000 10,462,500
--------------
28,807,688
--------------
RETAIL (0.6%)
Office Depot, Inc. 1,494,600 15,786,713
--------------
TELECOMMUNICATIONS & EQUIPMENT (18.4%)
ADC Telecommunications, Inc. (DAGGER) 25,000 1,518,750
Advanced Fibre Communications, Inc.(DAGGER) 3,130 143,002
Amdocs, Ltd. (DAGGER) 767,400 51,943,388
ANTEC Corp. (DAGGER) 754,900 40,575,875
Audiocodes, Ltd. (DAGGER) 585,590 43,919,250
Clarent Corp. (DAGGER) 337,700 22,963,600
Comverse Technology, Inc. 208,600 18,604,513
Corecomm Ltd. (DAGGER) 568,725 17,772,656
Exodus Communications, Inc. (DAGGER) 181,700 16,069,094
iBasis, Inc. (DAGGER) 268,900 6,083,863
Intermedia Communications, Inc. (DAGGER) 569,200 23,194,900
ITC DeltaCom, Inc. (DAGGER) 735,933 24,193,797
McLeodUSA, Inc. (DAGGER) 1,257,675 31,441,875
Polycom, Inc. (DAGGER) 611,825 48,410,653
Scientific Atlanta, Inc. 699,500 45,511,219
Spectrasite Holdings, Inc. (DAGGER) 1,094,575 22,986,075
Symbol Technologies, Inc. 430,987 24,027,525
Time Warner Telecom, Inc. 5,000 273,750
West TeleServices Corp.(DAGGER) 421,800 8,910,525
--------------
448,544,310
--------------
TOTAL COMMON STOCKS (Cost $1,636,867,950) 2,259,105,972
--------------
See Accompanying Notes to Financial Statements.
7
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
------------ ------
PREFERRED STOCKS (0.4%)
Celltra Ltd. Series C # 1,102,524 $ 7,000,002
Opal Concepts, Inc. Series B # 792,603 2,000,000
--------------
TOTAL PREFERRED STOCKS (Cost $9,000,000) 9,000,002
--------------
WARRANTS (0.0%)
Women First Healthcare, Inc. Warrants # 5,516 0
(Cost $0) --------------
PAR
------
BONDS (0.6%)
Orckit Communications, Inc. 5.750% 04/01/05 $ 15,000,000 11,493,750
TimesSquareMedia.com, Inc. 6.000% 11/22/02# 2,900,000 2,900,000
--------------
TOTAL BONDS (Cost $17,900,000) 14,393,750
--------------
NUMBER
OF
SHARES
------------
SHORT TERM INVESTMENTS (5.7%)
Institutional Money Market Trust 25,095,816 25,095,816
RBB Money Market Fund 114,648,091 114,648,091
--------------
TOTAL SHORT TERM INVESTMENTS (Cost $139,743,907) 139,743,907
--------------
TOTAL INVESTMENTS AT VALUE (99.2%) (Cost $1,803,511,857) 2,422,243,631
OTHER ASSETS IN EXCESS OF LIABILITIES (0.8%) 19,035,011
--------------
NET ASSETS (100.0%) $2,441,278,642
==============
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
--------------------------------------------------------------------------------
(DAGGER) Non-income producing security.
# Restricted security.
See Accompanying Notes to Financial Statements.
8
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
SCHEDULE OF INVESTMENTS--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
---------- ------
COMMON STOCKS (93.8%)
BANKS & SAVINGS & LOANS (7.0%)
Century Bancorp, Inc., Class A 30,300 $ 393,900
City National Corp. 11,200 412,300
Prosperity Bancshares, Inc. 40,500 564,469
Texas Regional Bancshares, Inc. 14,518 414,670
-----------
1,785,339
-----------
BUILDING & BUILDING MATERIALS (3.5%)
Centex Corp. 10,200 246,075
Elcor Corp. 7,200 229,050
Walter Industries, Inc. (DAGGER) 37,600 401,850
-----------
876,975
-----------
BUSINESS SERVICES (5.6%)
Graco, Inc. 11,000 372,625
Interim Services, Inc. (DAGGER) 15,900 272,287
National Data Corp. 8,300 230,325
Sensormatic Electronics Corp. 4,800 80,100
Wilmar Industries, Inc. (DAGGER) 27,100 464,087
-----------
1,419,424
-----------
CHEMICALS (1.8%)
Crompton Corp. 38,000 446,500
-----------
COMMUNICATIONS & MEDIA (1.0%)
Insight Communications Co., Inc. (DAGGER) 12,500 254,687
-----------
COMPUTERS (1.8%)
Exabyte Corp. (DAGGER) 30,800 146,300
Hyperion Solutions Corp. (DAGGER) 4,500 136,477
JDA Software Group, Inc. (DAGGER) 20 372
PerkinElmer, Inc. 1,400 76,650
Sybase, Inc. (DAGGER) 4,700 94,881
-----------
454,680
-----------
CONGLOMERATES (2.5%)
Gaylord Container Corp. (DAGGER) 62,051 318,011
Watts Industries, Inc., Class A 23,700 316,987
-----------
634,998
-----------
CONSUMER DURABLES (7.0%)
Aftermarket Technology Corp. (DAGGER) 38,400 446,400
Harman International Industries, Inc. 10,600 692,975
KEMET Corp. (DAGGER) 1,800 134,100
La-Z-Boy, Inc. 15,800 247,863
Superior Industries International, Inc. 7,977 256,760
-----------
1,778,098
-----------
See Accompanying Notes to Financial Statements.
9
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
---------- ------
COMMON STOCKS (CONT'D)
CONSUMER NON-DURABLES (3.9%)
Borg-Warner Automotive, Inc. 6,500 $ 271,781
WestPoint Stevens, Inc. 38,500 721,875
-----------
993,656
-----------
CONSUMER SERVICES (1.5%)
Lo-Jack Corp. (DAGGER) 51,400 369,437
-----------
ELECTRONICS (3.3%)
Avant! Corp. (DAGGER) 16,300 293,400
Cypress Semiconductor Corp. (DAGGER) 2,500 129,844
Exar Corp. (DAGGER) 1,000 80,172
Integrated Device Technology, Inc. (DAGGER) 4,800 230,700
International Rectifier Corp. (DAGGER) 2,100 103,162
-----------
837,278
-----------
FINANCIAL SERVICES (12.0%)
AmeriCredit Corp. (DAGGER) 24,300 454,106
HCC Insurance Holdings, Inc. 25,900 304,325
Mercury General Corp. 16,700 457,163
National Western Life Insurance Co., Class A (DAGGER) 3,800 282,863
Radian Group, Inc. 10,105 514,723
StanCorp Financial Group, Inc. 21,100 614,538
Webster Financial Corp. 19,800 423,225
-----------
3,050,943
-----------
HEALTHCARE (8.9%)
Health Management Associates, Inc., Class A 22,000 350,625
ICU Medical, Inc. (DAGGER) 6,800 148,750
Manor Care, Inc. (DAGGER) 27,900 333,056
Morrison Management Specialists, Inc. 19,250 532,984
Omnicare, Inc. 37,000 561,938
Universal Health Services, Inc., Class B 6,200 339,450
-----------
2,266,803
-----------
INDUSTRIAL MANUFACTURING & PROCESSING (1.4%)
Bethlehem Steel Corp. (DAGGER) 64,400 346,150
-----------
LEISURE & ENTERTAINMENT (1.9%)
SCP Pool Corp. (DAGGER) 12,813 471,679
-----------
METALS & MINING (2.3%)
Freeport-McMoRan Copper & Gold, Inc., Class B (DAGGER) 25,400 244,475
National Steel Corp., Class B 53,500 334,375
-----------
578,850
-----------
OFFICE EQUIPMENT & SUPPLIES (0.3%)
Imation Corp. (DAGGER) 2,500 70,156
-----------
See Accompanying Notes to Financial Statements.
10
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
---------- ------
COMMON STOCKS (CONT'D)
OIL SERVICES (8.0%)
Evergreen Resources, Inc. (DAGGER) 18,600 $ 430,125
Global Industries, Ltd. (DAGGER) 34,700 494,475
Newpark Resources, Inc. (DAGGER) 24,000 198,000
Pride International, Inc. (DAGGER) 21,100 477,388
Varco International, Inc. 34,952 436,900
-----------
2,036,888
-----------
PAPER & FOREST PRODUCTS (3.1%)
Abitibi-Consolidated, Inc. 21,500 233,813
Caraustar Industries, Inc. 30 456
Ivex Packaging Corp. (DAGGER) 31,300 281,700
Wausau-Mosinee Paper Corp. 23,200 281,300
-----------
797,269
-----------
REAL ESTATE (6.0%)
BRE Properties, Inc., Class A 14,000 391,125
CenterPoint Properties Corp. 7,400 265,475
Home Properties of New York, Inc. 13,300 372,400
Mission West Properties, Inc. 49,386 413,608
Western Water Co. (DAGGER) 149,800 79,581
-----------
1,522,189
-----------
RETAIL (0.8%)
AnnTaylor Stores Corp. (DAGGER) 9,700 200,669
-----------
TRANSPORTATION (5.3%)
Airborne Freight Corp. 19,600 420,175
Landstar Systems, Inc. (DAGGER) 9,600 549,600
M.S. Carriers, Inc. (DAGGER) 15,700 372,875
-----------
1,342,650
-----------
UTILITIES-ELECTRIC (4.9%)
IDACORP, Inc. 10,250 377,969
NSTAR 10,900 480,281
UniSource Energy Corp. 24,000 390,000
-----------
1,248,250
-----------
TOTAL COMMON STOCKS (Cost $20,385,525) 23,783,568
-----------
See Accompanying Notes to Financial Statements.
11
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
SCHEDULE OF INVESTMENTS (CONT'D)--APRIL 30, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
NUMBER
OF
SHARES VALUE
---------- ------
CONVERTIBLE BOND (0.6%)
EA Industries, Inc., Series A Convertible Notes
(NR, NR) 1 #
6.000% 04/30/00
(Cost $1,500,000) $1,500,000 $ 150,000
-----------
SHARES
--------
SHORT TERM INVESTMENTS (6.1%)
Institutional Money Market Trust 323,274 323,274
RBB Money Market Fund 1,216,563 1,216,563
-----------
TOTAL SHORT TERM INVESTMENTS (Cost $1,539,837) 1,539,837
-----------
WARRANTS (0.0%)
EA Industries, Inc. 1
(Cost $110,438) 1 0
-----------
TOTAL INVESTMENTS AT VALUE (100.5%) (Cost $23,535,800) 25,473,405
LIABILITIES IN EXCESS OF OTHER ASSETS (0.5%) (130,559)
-----------
NET ASSETS (100.0%) $25,342,846
===========
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
--------------------------------------------------------------------------------
(DAGGER) Non-income producing security.
1 Illiquid security.
# Bond is currently in default.
See Accompanying Notes to Financial Statements.
12
<PAGE>
WARBURG PINCUS FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS WARBURG PINCUS
EMERGING GROWTH SMALL COMPANY
FUND VALUE FUND
--------------- --------------
<S> <C> <C>
ASSETS
Investments at value (Cost - $1,803,511,857, and
$23,535,800, respectively) $2,422,243,631 $25,473,405
Dividends and interest receivable 558,768 61,170
Receivable for fund shares sold 2,271,583 258
Receivable for investment securities sold 58,516,936 88,113
Prepaid expenses and other assets 26,065 28,852
-------------- -----------
2,483,616,983 25,651,798
-------------- -----------
LIABILITIES
Advisory fee payable 1,786,999 18,532
Administrative fee payable 338,817 2,059
Shareholder servicing fee payable 130,787 5,155
Payable for investments purchased 38,855,854 207,762
Payable for fund share 0 4,848
Accrued expenses payable 1,225,884 70,596
-------------- -----------
42,338,341 308,952
-------------- -----------
NET ASSETS
Capital stock, $0.001 par value 48,858 97,874
Paid-in capital 1,376,931,353 19,622,492
Accumulated undistributed net investment loss (9,367,591) (77,595)
Accumulated net realized gain from security transactions 454,934,248 3,762,469
Net unrealized appreciation/depreciation from investments 618,731,774 1,937,606
-------------- -----------
Net Assets $2,441,278,642 $25,342,846
============== ===========
COMMON SHARES
Net assets $2,120,194,859 $25,305,648
-------------- -----------
Shares outstanding 42,193,640 2,021,659
-------------- -----------
Net asset value, offering price and redemption
price per share $50.25 $12.52
====== ======
ADVISOR SHARES
Net assets $ 321,083,783 $ 37,198
-------------- -----------
Shares outstanding 6,668,375 2,993
-------------- -----------
Net asset value, offering price and redemption
price per share $48.15 $12.43
====== ======
</TABLE>
See Accompanying Notes to Financial Statements.
13
<PAGE>
WARBURG PINCUS FUNDS
STATEMENTS OF OPERATIONS
For the Six Months Ended April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS WARBURG PINCUS
EMERGING GROWTH SMALL COMPANY
FUND VALUE FUND
--------------- --------------
<S> <C> <C>
INVESTMENT INCOME:
Dividends $ 448,543 $ 128,922
Interest 5,086,180 37,364
------------ ----------
Total investment income 5,534,723 166,286
------------ ----------
EXPENSES:
Investment advisory fees 10,719,845 139,337
Administrative services fees 2,037,294 29,132
Transfer agent fees 1,238,097 4,252
Shareholder servicing/Distribution fees 759,756 34,876
Custodian/Sub-custodian fees 207,682 14,712
Printing fees 117,832 3,548
Legal fees 68,563 9,723
Registration fees 44,482 20,901
Audit fees 28,319 5,345
Directors fees 7,518 6,408
Insurance expense 36 595
Offering/Organizational costs 0 7,431
Miscellaneous expense 22,787 1,629
------------ ----------
15,252,211 277,889
Less: fees waived and transfer agent offsets (349,897) (34,008)
------------ ----------
Total expenses 14,902,314 243,881
------------ ----------
Net investment loss (9,367,591) (77,595)
------------ ----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
FROM INVESTMENTS:
Net realized gain from Investments 459,769,378 3,981,136
Net change in unrealized appreciation
(depreciation) from investments 81,486,530 (208,709)
------------ ----------
Net realized and unrealized gain
from investments 541,255,908 3,772,427
------------ ----------
Net increase in net assets
resulting from operations $531,888,317 $3,694,832
============ ==========
</TABLE>
See Accompanying Notes to Financial Statements.
14
<PAGE>
WARBURG PINCUS FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WARBURG PINCUS WARBURG PINCUS
EMERGING GROWTH SMALL COMPANY VALUE
FUND FUND
---------------------------------- -----------------------------
FOR THE FOR THE FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
---------------- -------------- ---------------- -----------
2000 1999 2000 1999
---------------- -------------- ---------------- -----------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment loss $ (9,367,591) $ (15,518,919) $ (77,595) $ (354,167)
Net realized gain from investments 459,769,378 300,644,500 3,981,136 3,792,545
Net change in unrealized appreciation
(depreciation) from investments 81,486,530 205,391,594 (208,709) (4,750,334)
-------------- -------------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 531,888,317 490,517,175 3,694,832 (1,311,956)
-------------- -------------- ----------- -----------
FROM DISTRIBUTIONS:
Distributions from net realized gains
Common Class shares (225,635,097) 0 (3,505,579) (2,280,474)
Advisor Class shares (31,683,347) 0 (2,470) (1,680)
-------------- -------------- ----------- -----------
Net decrease in net assets from
distributions (257,318,444) 0 (3,508,049) (2,282,154)
-------------- -------------- ----------- -----------
FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares 876,074,351 724,682,855 9,303,594 30,617,506
Reinvestment dividends and distributions 248,328,680 225 3,045,568 2,155,694
Net asset value of shares redeemed (778,533,477) (1,237,905,127) (16,424,087) (80,318,997)
-------------- -------------- ----------- -----------
Net increase (decrease) in net assets
from capital share transactions 345,869,554 (513,222,047) (4,074,925) (47,545,797)
-------------- -------------- ----------- -----------
Net increase (decrease) in net assets 620,439,427 (22,704,872) (3,888,142) (51,139,907)
NET ASSETS:
Beginning of period 1,820,839,215 1,843,544,087 29,230,988 80,370,895
-------------- -------------- ----------- -----------
End of period $2,441,278,642 $1,820,839,215 $25,342,846 $29,230,988
============== ============== =========== ===========
UNDISTRIBUTED NET INVESTMENT INCOME: $ (9,367,591) $ 0 $ (77,595) $ 0
============== ============== =========== ===========
</TABLE>
See Accompanying Notes to Financial Statements.
15
<PAGE>
WARBURG PINCUS EMERGING GROWTH FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class share of the Fund Outstanding Throughout Each Period)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2000 ---------------------------------------------------------------
PERIOD ENDED: (UNAUDITED) 1999 1998 1997 1996 1995
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $ 41.99 $ 32.51 $ 38.50 $ 31.99 $ 29.38 $ 22.05
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES:
Net investment loss (0.28) (0.65) (0.49) (0.33) (0.09) (0.09)
Net gains or losses on investments
and foreign currency related items
(both realized and unrealized) 12.41 10.13 (3.11) 6.91 4.45 7.42
-------- -------- -------- -------- -------- --------
Total from investment activities 12.13 9.48 (3.60) 6.58 4.36 7.33
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Distributions from net realized
capital gains (5.97) 0.00 (2.39) (0.07) (1.75) 0.00
-------- -------- -------- -------- -------- --------
Total distributions (5.97) 0.00 (2.39) (0.07) (1.75) 0.00
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 48.15 $ 41.99 $ 32.51 $ 38.50 $ 31.99 $ 29.38
======== ======== ======== ======== ======== ========
Total return 30.31%2 29.16% (9.75)% 20.62% 15.69% 33.24%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted) $321,084 $228,244 $311,023 $457,432 $362,696 $167,225
Ratio of expenses to average
net assets 1.72%1,3 1.72%1 1.62%1 1.63%1 1.70%1 1.76%
Ratio of net loss to average
net assets .72%3 (1.25)% (.87)% (1.01)% (1.05)% (1.08)%
Portfolio turnover rate 117.86% 154.08% 91.60% 87.03% 65.77% 84.82%
<FN>
--------------------------------------------------------------------------------
1 Interest earned on uninvested cash balances is used to offset portions of
transfer agent expense. These arrangements resulted in a reduction to the net
expense ratio by .03% annualized for the six months ended April 30, 2000 and
by .01%, .00%, .00% and .01% for the year ended October 31, 1999, 1998, 1997
and 1996, respectively. The operating expense ratios after reflecting these
arrangements were 1.69% for the six months ended April 30, 2000, 1.72%,
1.62%, 1.63% and 1.69% for the year ended October 31, 1999, 1998, 1997 and
1996, respectively.
2 Non-annualized.
3 Annualized.
</FN>
</TABLE>
See Accompanying Notes to Financial Statements.
16
<PAGE>
WARBURG PINCUS SMALL COMPANY VALUE FUND
FINANCIAL HIGHLIGHTS
(For an Advisor Class share of the Fund Outstanding Throughout Each Period)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE SIX DECEMBER 29, 1995
MONTHS ENDED FOR THE YEAR ENDED OCTOBER 31, (COMMENCEMENT OF
APRIL 30, 2000 ----------------------------------- OPERATIONS) THROUGH
PERIOD ENDED: (UNAUDITED) 1999 1998 1997 OCTOBER 31, 1996
-------------- ------- ------- ------ -------------------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $12.35 $ 13.30 $ 18.65 $14.46 $10.00
------ ------- ------- ------ ------
INVESTMENT ACTIVITIES:
Net investment loss (0.04) (0.18) (0.40) (0.08) (0.02)
Net gains (losses) on investments
and foreign currency related items
(both realized and unrealized) 1.60 (0.34) (3.02) 4.44 4.48
------ ------- ------- ------ ------
Total from investment activities 1.56 (0.52) (3.42) 4.36 4.46
------ ------- ------- ------ ------
LESS DISTRIBUTIONS:
Distributions from net realized
capital gains (1.48) (0.43) (1.93) (0.17) 0.00
------ ------- ------- ------ ------
Total distributions (1.48) (0.43) (1.93) (0.17) 0.00
------ ------- ------- ------ ------
NET ASSET VALUE, END OF PERIOD $12.43 $ 12.35 $ 13.30 $18.65 $14.46
====== ======= ======= ====== ======
Total return 12.79%2 (4.17)% (19.93)% 30.47% 44.60%2
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted) $ 37 $ 30 $ 53 $ 255 $ 5
Ratio of expenses to average
net assets 2.03%1,3 2.01%1 1.97%1 1.89%1 1.97%1,3
Ratio of net loss to average net assets (.75)%3 (1.02)% (.92)% (.78)% (.52)%3
Decrease reflected in above
operating expense ratios due to
waivers/reimbursements .20%3 .39% .27% .00% 1.46%3
Portfolio turnover rate 75.52% 168.57% 77.92% 105.87% 43.14%2
--------------------------------------------------------------------------------
<FN>
1 Interest earned on uninvested cash balances is used to offset portions of
transfer agent expense. These arrangements resulted in a reduction to the net
expense ratio by .03% for the six months ended April 30, 2000 and by .01%,
.00%, .01% and .00% for the year or period ended October 31, 1999, 1998, 1997
and 1996, respectively. The operating expense ratios after reflecting these
arrangements were 2.00% for the six months ended April 30, 2000 and 2.00%,
1.97%, 1.88% and 1.97% for the year or period ended October 31, 1999, 1998,
1997 and 1996, respectively.
2 Non-annualized.
3 Annualized.
</FN>
</TABLE>
See Accompanying Notes to Financial Statements.
17
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
The Warburg Pincus Emerging Growth Fund (the "Emerging Growth Fund"), and
Warburg Pincus Small Company Value (the "Small Company Value Fund"), (each a
"Fund" and collectively the "Funds") each a Maryland Corporation, and are
registered under the Investment Company Act of 1940, as amended (the "1940 Act")
as a diversified open-end management investment company (except the Emerging
Growth Fund), which is not diversified.
Investment objectives for each Fund are as follows: the Emerging Growth Fund
seeks maximum capital appreciation; the Small Company Value Fund seeks long-term
capital appreciation.
Each Fund may invest up to 10% of its total assets in non-publicly traded
securities. Non-publicly traded securities may be less liquid than publicly
traded securities, and they may be difficult or impossible to sell at the time
and the price the Fund would like. In addition, the lack of an active market may
make it difficult to obtain an accurate price for a Fund security.
Each Fund offers two classes of shares, one class being referred to as the
Common Class shares and one class being referred to as the Advisor Class shares.
Common Class and Advisor Class shares in each Fund represent an equal pro rata
interest in such Fund, except that they bear different expenses which reflect
the difference in the range of services provided to them. Common Class shares
for the Small Company Value Fund bear expenses paid pursuant to a shareholder
servicing and distribution plan at an annual rate of .25% of the average daily
net asset value of the Fund's Common Class shares. Advisor Class shares bear
expenses paid pursuant to a distribution plan at an annual rate not to exceed
.75% of the average daily net asset value of the applicable Fund's Advisor Class
shares. Advisor Class shares are currently bearing expenses of .50% of average
daily net assets.
The net asset value of each Fund is determined daily as of the close of
regular trading on the New York Stock Exchange. Each Fund's investments are
valued at market value, which is generally determined using market quotations.
If no sales are reported, investments are generally valued at the mean between
the last reported bid and asked prices. If market quotations are not readily
available, securities and other assets are valued by another method that the
Board of Directors believes accurately reflects fair value. Debt that will
mature in 60 days or less is valued on the basis of amortized cost, which
approximates market value, unless the Board determines that using this method
would not accurately reflect an investment's value.
18
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
The books and records of the Funds are maintained in U.S. dollars.
Transactions denominated in foreign currencies are recorded at the current
prevailing exchange rates. All assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the current exchange rate
at the end of the period. Translation gains or losses resulting from changes in
the exchange rate during the reporting period and realized gains and losses on
the settlement of foreign currency transactions are reported in the results of
operations for the current period. The Funds do not isolate that portion of
realized gains and losses on investments in equity securities which are due to
changes in the foreign exchange rate from that which is due to changes in market
prices of equity securities. The Funds isolate that portion of realized gains
and losses on investments in debt securities which are due to changes in the
foreign exchange rate from that which are due to changes in market prices of
debt securities.
Security transactions are accounted for on a trade date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date. Income, expenses (excluding class-specific expenses,
principally distribution and shareholder servicing fees) and realized/unrealized
gains/losses are allocated proportionately to each class of shares based upon
the relative net asset value of outstanding shares of that class. The cost of
investments sold is determined by use of the specific identification method for
both financial reporting and income tax purposes.
Dividends from net investment income and net realized capital gains, if any,
are declared and paid at least annually. However, to the extent that a net
realized capital gain can be reduced by a capital loss carryover, such gain will
not be distributed. Income and capital gain distributions are determined in
accordance with federal income tax regulations which may differ from generally
accepted accounting principles.
No provision is made for federal taxes, as it is each Fund's intention to
continue to qualify for and elect the tax treatment applicable to regulated
investment companies under the Internal Revenue Code of 1986, as amended, (the
"Code") and make the requisite distributions to its shareholders, which will be
sufficient to relieve it from federal income and excise taxes.
Costs incurred in connection with organization of each Fund other than
Emerging Growth Fund have been deferred and are being amortized over a period of
five years from the date each Fund commenced its operations.
19
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES -- (CONT'D)
Pursuant to an exemptive order issued by the Securities and Exchange
Commission, each Fund, along with other Funds advised by Credit Suisse Asset
Management, LLC ("CSAM"), can transfer uninvested cash balances to a pooled cash
account, which can invest in repurchase agreements secured by U.S. government
securities. Securities, pledged as collateral for repurchase agreements, are
held by the Funds' custodian bank until the agreements mature. Each agreement
requires that the market value of the collateral be sufficient to cover payments
of interest and principal; however, in the event of default or bankruptcy by the
counterpart to the agreement, retention of the collateral may be subject to
legal proceedings. As of April 30, 2000, the Funds had no investments in
repurchase agreements.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from these estimates.
The Funds have an arrangement with their transfer agent whereby interest
earned on uninvested cash balances was used to offset a portion of their
transfer agent expense. For the six months ended April 30, 2000, the Funds
received credits or reimbursements under this arrangement as follows:
FUND AMOUNT
---- --------
Emerging Growth $349,897
Small Company Value 3,888
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR
On July 6, 1999, CSAM became each Funds' investment adviser as a result of
the previously announced acquisition of Warburg Pincus Asset Management, Inc.
("Warburg Pincus") by Credit Suisse Group ("Credit Suisse"). Warburg Pincus was
combined with CSAM, which is an indirect wholly-owned U.S. subsidiary of Credit
Suisse. For its investment advisory services, CSAM receives the following fees
based on each Fund's average daily net assets:
FUND ANNUAL RATE
------ ---------------------------------
Emerging Growth Fund .90% of average daily net assets
Small Company Value Fund 1.00% of average daily net assets
20
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR -- (CONT'D)
For the six months ended April 30, 2000, investment advisory fees and
voluntary waivers were as follows:
GROSS NET
FUND ADVISORY FEE WAIVER ADVISORY FEE
---- ------------ -------- ------------
Emerging Growth Fund $10,719,845 $ 0 $10,719,845
Small Company Value Fund 139,337 (17,658) 121,679
Counsellors Funds Service, Inc. ("CFSI"), a wholly-owned subsidiary of CSAM
served as co-administrator of each Fund until November 1, 1999. On November 1,
1999, Credit Suisse Asset Management Securities, Inc. ("CSAMSI") replaced CFSI
as co-administrator to each Fund. PFPC Inc. ("PFPC"), an indirect subsidiary of
PNC Financial Services Group, Inc. ("PNC"), also serves as each Fund's
co-administrator. For its administrative services, CSAMSI currently receives a
fee calculated at the rate of .10% of each Fund's daily net assets. For the six
months ended April 30, 2000, administrative services fees were as follows:
FUND CO-ADMINISTRATION FEE
---- ---------------------
Emerging Growth Fund $1,191,094
Small Company Value Fund 13,934
For administrative services, PFPC currently receives a fee, exclusive of
out-of-pocket expenses, calculated as follows:
AVERAGE DAILY
NET ASSETS ANNUAL RATE
------------------ -----------
First $500 million 0.10%
Next $1 Billion 0.075%
Over $1.5 Billion 0.05%
For the six months ended April 30, 2000, administrative services fees earned
and voluntarily waived by PFPC (including out-of-pocket expenses) were as
follows:
<TABLE>
<CAPTION>
NET
FUND CO-ADMINISTRATION FEE WAIVER CO-ADMINISTRATION FEE
---- --------------------- -------- ---------------------
<S> <C> <C> <C>
Emerging Growth Fund $846,200 $ 0 $846,200
Small Company Value Fund 15,198 (13,934) 1,264
</TABLE>
CSAMSI also serves as each Fund's distributor. No compensation is paid by the
Common Class shares of the Emerging Growth Fund to CSAMSI for distribution
services. Provident Distributors, Inc. will become each Fund's distributor
effective January 3, 2000. For its shareholder and selling services, CSAMSI
receives a fee calculated at an annual rate of .25% of the average daily net
assets of Common Class shares of the Small Company Value Fund
21
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR -- (CONT'D)
and the Small Company Growth Fund pursuant to a shareholder servicing and
distribution plan adopted by each Fund pursuant to Rule 12b-1 under the 1940
Act. CSAMSI receives a fee at an annual rate of .50% of the average daily net
assets of each Fund's Advisor Class shares pursuant to a distribution plan
adopted by each Fund pursuant to Rule 12b-1 under the 1940 Act which CSAMSI may
use to compensate service organizations for shareholder servicing and
distribution services. For the six months ended April 30, 2000, shareholder
servicing and distribution fees were as follows:
SHAREHOLDER SERVICING/
FUND DISTRIBUTION FEE
---- ----------------------
Emerging Growth Fund
Advisor Class shares $759,756
========
Small Company Value Fund
Common Class shares $ 34,793
Advisor Class shares 83
--------
$ 34,876
========
3. LINE OF CREDIT
The Funds, together with other Funds advised by CSAM, have established a $250
million committed, unsecured, line of credit facility ("Credit Facility") with
Deutsche Bank AG as administrative agent, State Street Bank and Trust Company as
operations agent, Bank of Nova Scotia as syndication agent as well as certain
other lenders, for temporary or emergency purposes primarily relating to
unanticipated portfolio share redemptions. Under the terms of the Credit
Facility, the Funds with access to the Credit Facility pay an aggregate
commitment fee at a rate of .075% per annum on the average daily balance of the
Credit Facility that is undisbursed and uncanceled during the preceding quarter
allocated among the participating Funds in such manner as is determined by the
governing Boards of the various Funds. In addition, the participating Funds will
pay interest on borrowing at the Federal funds rate plus .50%. At April 30,
2000, there were no loans outstanding for any of the Funds. During the six
months ended April 30, 2000, borrowings under the Credit Facility were as
follows:
MAXIMUM
AVERAGE DAILY AVERAGE DAILY LOAN
FUND LOAN BALANCE INTEREST RATE % OUTSTANDING
---- ------------- --------------- -----------
Small Company Growth Fund $15,978 6.02 $671,000
22
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
4. INVESTMENTS IN SECURITIES
At April 30, 2000, purchases and sales of investment securities (excluding
short-term investments) were as follows:
FUND PURCHASES SALES
---- -------------- --------------
Emerging Growth Fund $2,560,207,899 $2,544,358,565
Small Company Value Fund 20,301,236 27,249,435
At April 30, 2000, the net unrealized appreciation from investments for those
securities having an excess of value over cost and net unrealized depreciation
from investments for those securities having an excess of cost over value (based
on cost for federal income tax purposes) was as follows:
UNREALIZED UNREALIZED NET UNREALIZED
FUND APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------- --------------
Emerging Growth Fund $768,027,152 $(149,295,379) $618,731,773
Small Company Value Fund 4,572,261 (2,634,655) 1,937,606
5. RESTRICTED SECURITIES
Certain Funds' investments are restricted as to resale, are not readily
marketable and are valued as determined by or under the direction of each Fund's
Board in good faith, at fair value. The table below shows the number of shares
held, the acquisition dates, aggregate cost, fair value as of April 30, 2000,
and share value of the securities and percent of net assets, which the
securities comprise.
<TABLE>
<CAPTION>
PERCENTAGE
SECURITY ACQUISITION MARKET OF NET
FUND SECURITY DESCRIPTION TYPE DATE(S) COST VALUE ASSETS
---- -------------------- -------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Emerging Growth
Fund
SoftCom, Inc. Preferred 12/21/99 $ 999,000 $ 999,999 0.04
Breeze Com, Ltd Series B Preferred 11/04/99 7,168,432 38,259,716 1.57
Celletra Limited Series C Preferred 04/05/00 7,000,000 7,000,000 0.29
Times Square Media Bond 11/23/99 2,900,000 2,900,000 0.12
Chaparral Resources, Inc. Common 07/28/98 1,250,000 109,375 0.01
New York Restaurant Group, Inc. Common 10/30/97 3,249,985 3,249,985 0.13
Opal Concepts, Inc. Series B Preferred 08/31/95 2,000,000 2,000,000 0.08
Women First Healthcare, Inc. Preferred 01/08/98 1,500,000 514,688 0.02
Women First Healthcare, Inc. Warrants 03/18/99 0 0 0.00
----------- ----------- ----
$26,068,416 $55,033,763 2.26%
=========== =========== ====
Small Company
Value Fund
EA Industries, Inc. Bond 04/17/97 $ 1,500,000 $ 150,000 0.60%
EA Industries, Inc. Warrants 03/31/98 110,438 0 0.00%
----------- ----------- ----
$ 1,610,438 $ 150,000 0.60%
=========== =========== ====
</TABLE>
23
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
6. FORWARD FOREIGN CURRENCY CONTRACTS
Each Fund may enter into forward currency contracts for the purchase or sale
of a specific foreign currency at a fixed price on a future date. Risks may
arise upon entering into these contracts from the potential inability of
counterparties to meet the terms of their contracts and from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar. Each
Fund will enter into forward contracts primarily for hedging purposes. Forward
currency contracts are adjusted by the daily exchange rate of the underlying
currency and any gains or losses are recorded for financial statement purposes
as unrealized until the contract settlement date or an offsetting position is
entered into. At April 30, 2000, there were no open forward foreign currency
contracts.
7. CAPITAL SHARE TRANSACTIONS
Each Fund is authorized to issue three billion full and fractional shares of
capital stock, $.001 par value per share, of which one billion shares (two
billion in the case of the Emerging Growth Fund) of each Fund are classified as
the Advisor Class.
Transactions in classes of each Fund were as follows:
<TABLE>
<CAPTION>
EMERGING GROWTH FUND
------------------------------------------------------------------------
COMMON CLASS SHARES ADVISOR CLASS SHARES
---------------------------------- ---------------------------------
FOR THE FOR THE
SIX MONTHS FOR THE SIX MONTHS FOR THE
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- --------------- -------------- -------------
<S> <C> <C> <C> <C>
Shares sold 15,558,944 17,598,528 1,246,907 882,074
Shares issued to shareholders on reinvestment
of dividends 4,767,193 6 711,829 0
Shares redeemed (14,535,528) (26,668,182) (489,228) (5,013,511)
------------- --------------- ------------ -------------
Net increase (decrease) in shares outstanding 5,790,609 (9,069,648) 1,469,508 (4,131,437)
============= =============== ============ =============
Proceeds from sale of shares $ 810,858,604 $ 690,945,900 $ 65,215,747 $ 33,736,955
Reinvestment of distributions 217,193,291 225 31,135,389 0
Net asset value of shares redeemed (743,334,234) (1,047,436,237) (35,199,243) (190,468,890)
------------- --------------- ------------ -------------
Net increase (decrease) from capital share
transactions $ 284,717,661 $ (356,490,110) $ 61,151,893 $(156,731,935)
============= =============== ============ =============
</TABLE>
24
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
7. CAPITAL SHARE TRANSACTIONS -- (CONT'D)
<TABLE>
<CAPTION>
SMALL COMPANY VALUE FUND
------------------------------------------------------------------------
COMMON CLASS SHARES ADVISOR CLASS SHARES
---------------------------------- ---------------------------------
FOR THE FOR THE
SIX MONTHS FOR THE SIX MONTHS FOR THE
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- --------------- -------------- --------------
<S> <C> <C> <C> <C>
Shares sold 641,816 2,370,859 25,958 2,662
Shares issued to shareholders on reinvestment
of dividends 246,303 161,133 103 101
Shares redeemed (1,164,712) (6,189,358) (25,518) (4,265)
------------ ------------ --------- --------
Net decrease in shares outstanding (276,593) (3,657,366) 543 (1,502)
============ ============ ========= ========
Proceeds from sale of shares $ 8,983,904 $ 30,585,137 $ 319,690 $ 32,369
Reinvestment of distributions 3,044,299 2,154,348 1,269 1,346
Net asset value of shares redeemed (16,108,806) (80,265,308) (315,281) (53,689)
------------ ------------ --------- --------
Net increase (decrease) from capital share
transactions $ (4,080,603) $(47,525,823) $ 5,678 $(19,974)
============ ============ ========= ========
</TABLE>
25
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS
Each fund currently offers one other class of shares, Common Class shares,
representing equal pro rata interests in each of the respective Funds. The
financial highlights for a Common Class share of each Fund are as follows:
<TABLE>
<CAPTION>
WARBURG PINCUS EMERGING GROWTH FUND
-------------------------------------------------------------------
COMMON CLASS SHARES
-------------------------------------------------------------------
FOR THE SIX
MONTHS ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2000 -------------------------------------------------------------------
PERIOD ENDED: (UNAUDITED) 1999 1998 1997 1996 1995
-------------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value,
beginning of period $ 43.73 $ 33.69 $ 39.66 $ 32.80 $ 29.97 $ 22.38
---------- ---------- ---------- ---------- ---------- --------
INVESTMENT ACTIVITIES:
Net investment loss (0.18) (0.33) (0.12) (0.19) (0.02) (0.05)
Net gains (losses) on
investments and foriegn
currency related items (both
realized and unrealized) 12.93 10.37 (3.46) 7.12 4.60 7.64
---------- ---------- ---------- ---------- ---------- --------
Total from investment
activities 12.75 10.04 (3.58) 6.93 4.58 7.59
---------- ---------- ---------- ---------- ---------- --------
LESS DISTRIBUTIONS:
Distributions from net realized
gains (6.23) 0.00 (2.39) (0.07) (1.75) 0.00
---------- ---------- ---------- ---------- ---------- --------
Total distributions (6.23) 0.00 (2.39) (0.07) (1.75) 0.00
---------- ---------- ---------- ---------- ---------- --------
NET ASSET VALUE, END OF PERIOD $ 50.25 $ 43.73 $ 33.69 $ 39.66 $ 32.80 $ 29.97
========== ========== ========== ========== ========== ========
Total return 30.63%2 29.80% (9.40)% 21.18% 16.14% 33.91%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000s omitted) $2,120,195 $1,592,595 $1,532,521 $1,515,385 $1,104,684 $487,537
Ratio of expenses to
average net assets 1.22%1,3 1.23%1 1.22%1 1.22%1 1.28%1 1.26%
Ratio of net loss to
average net assets (.72)%3 (.75)% (.48)% (.59)% (.63)% (.58)%
Portfolio turnover rate 117.86% 154.08% 91.60% 87.03% 65.77% 84.82%
--------------------------------------------------------------------------------
<FN>
1 Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expense. These arrangements resulted in a reduction to
the Common Class shares' expenses by .03% annualized for the six months
ended April 30, 2000, and by .01%, .00%, .01% and .01% for the years ending
1999, 1998, 1997 and 1996, respectively. The Common Class shares' operating
expense ratio after reflecting these arrangements were 1.22% for the six
months ended April 30, 2000, and 1.19%, 1.22%, 1.21% and 1.27% for the years
ending 1999, 1998, 1997 and 1996, respectively.
2 Non-annualized.
3 Annualized.
</FN>
</TABLE>
26
<PAGE>
WARBURG PINCUS DOMESTIC EQUITY FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
8. OTHER FINANCIAL HIGHLIGHTS -- (CONT'D)
<TABLE>
<CAPTION>
WARBURG PINCUS SMALL COMPANY VALUE FUND
-------------------------------------------------------------------------------
COMMON CLASS SHARES
-------------------------------------------------------------------------------
FOR THE SIX
MONTHS ENDED FOR THE YEAR ENDED OCTOBER 31,
APRIL 30, 2000 ---------------------------------------------------------
PERIOD ENDED: (UNAUDITED) 1999 1998 1997 1996 4
-------------- ------- ------- -------- -------
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA
Net asset value, beginning of period $ 12.47 $ 13.39 $ 18.77 $ 14.38 $ 10.00
------- ------- ------- -------- -------
INVESTMENT ACTIVITIES:
Net investment loss (0.04) (0.15) (0.12) (0.08) (0.02)
Net gains (losses) on investments and
foreign currency related items
(both realized and unrealized) 1.65 (0.34) (3.33) 4.64 4.40
------- ------- ------- -------- -------
Total from investment activities 1.61 (0.49) (3.45) 4.56 4.38
------- ------- ------- -------- -------
LESS DISTRIBUTIONS:
Distributions from net realized gains (1.56) (0.43) (1.93) (0.17) 0.00
------- ------- ------- -------- -------
Total distributions (1.56) (0.43) (1.93) (0.17) 0.00
------- ------- ------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 12.52 $ 12.47 $ 13.39 $ 18.77 $ 14.38
======= ======= ======= ======== =======
Total return 13.07%2 (3.91)% (19.97)% 32.05% 43.80%2
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted) $25,306 $29,201 $80,318 $223,675 $84,045
Ratio of expenses to average net assets 1.78%1,3 1.76%1 1.70%1 1.70%1 1.75%1,3
Ratio of net loss to average net assets (.56)%3 (.76)% (.46)% (.63)% (.43)%3
Decrease reflected in above operating expense
ratios due to waivers/reimbursements .23%3 .38% .01% .03% .44%3
Portfolio turnover rate 75.52% 168.57% 77.92% 105.87% 43.14%2
--------------------------------------------------------------------------------
<FN>
1 Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expense. These arrangements resulted in a reduction to
the Common Class shares' expenses by .03% annualized for the six months
ended April 30, 2000, and by .01%, .00%, .01% and .00% for the year or
period ending 1999, 1998, 1997 and 1996, respectively. The Common Class
shares' operating expense ratio after reflecting these arrangements were
1.75% for the six months ended April 30, 2000, and 1.75%, 1.70%, 1.69% and
1.75% for the year or period ending 1999, 1998, 1997 and 1996, respectively.
2 Non-annualized.
3 Annualized.
4 For the period December 29, 1995 (commencement of operations) through
October 31, 1996.
</FN>
</TABLE>
27
<PAGE>
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<PAGE>
WARBURG PINCUS
ADVISOR FUNDS
PROVIDENT
DISTRIBUTORS, INC.,
DISTRIBUTOR
Provident Distributors, Inc., Distributor, located at Four Falls Corporate
Center, 6th Floor, West Conshohocken, PA 19428-2961 is not affiliated with
Credit Suisse Asset Management, LLC. Warburg Pincus Advisor Funds are managed by
Credit Suisse Asset Management LLC.
[GRAPHIC OMITTED]
WARBURG PINCUS PINCUS PART OF CREDIT SUISSE ASSET MANAGEMENT
ADUSS-3-0400
