ANNUAL REPORT AS OF
FEBRUARY 28, 1997
SEI INTERNATIONAL TRUST
================================================================================
International Equity
================================================================================
Emerging Markets Equity
================================================================================
International Fixed Income
================================================================================
[SEI INVESTMENTS LOGO]
<PAGE>
LETTER TO SHAREHOLDERS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
DEAR SHAREHOLDER:
This past year proved to be a challenging one for investors in non-U.S.
bond and equity markets. Shifting views on the pace of European monetary accord
and the likely initial entrants into the European Monetary Union (EMU) provoked
startling reform in government finances in a number of countries and often led
to volatile activity in the debt markets. Among the world's equity markets,
frustration with the pace of Japan's economic recovery continued, while
investors in the "Tiger" and emerging markets of Asia were confronted with the
unusual environment of slowing growth rates and slackened demand for critical
products.
SEI's International Portfolios weathered these conditions in good form as
the accompanying discussion and analysis section reveals. I am pleased
to report, the International Equity Portfolio, Emerging Markets Equity Portfolio
and the International Fixed Income Portfolio all outperformed their market
indices for the year ended February, 1997.
The past year offered several demonstrations of SEI's dedication to
continual improvement and management of our investment strategies. Major
enhancements were made in the execution of our developed and emerging markets
equity strategies. Four new specialist sub-advisers were added to the
International Equity Portfolio while three were added to the Emerging Markets
Equity Portfolio. In the International Equity Portfolio, Farrell-Wako Global
Investment Management, Inc., Seligman Henderson Co., Yamaichi Capital Management
Inc. and Lazard London International Investment Management Limited each provide
the Portfolio with precise regional and style specialties as well as specific
stock-selection skills. In the Emerging Markets Portfolio, the addition of
Coronation Asset Management Ltd., Parametric Portfolio Associates and Yamaichi
Capital Management (Singapore) Limited, along with the decision to focus the
contributions of Montgomery Asset Management, L.P. on the Latin American
markets, provide greater coverage of the distinct regions across the emerging
market landscape. These attributes better align our implementations with the
conclusions of our extensive research effort to maximize returns in the non-U.S.
equity markets.
Continuing our efforts toward improving our investment lineup, shortly
after the close of the Trust's fiscal year, SEI received approval from the Board
of Trustees to open a new Emerging Market Debt Portfolio. Emerging market debt
securities have grown from obscure intra-bank trading instruments to significant
components of the world's capital markets. Additional information on this
Portfolio will be forthcoming.
In closing, I would like to relate a recent experience that further
underscores SEI's commitment to deliver superior investment results. As you
know, SEI's investment analysts spend considerable time visiting potential
sub-advisers and conducting thorough "field" research. Earlier in February, a
group of analysts from our Non-U.S. Equity Team was traveling in Hong Kong and
Taiwan at the time of the death of China's paramount leader, Deng Xiaoping.
While widely anticipated, given Deng's advanced age, the event nevertheless
caused considerable uncertainty in world financial markets as to Chinese
commitment to free-market practices. Our team's conclusions, based on first-hand
research, which included discussions with leading members of the Taiwanese
business and political community, was that the reform measures will continue and
that China remains committed to raising local living standards and joining the
market for global trade.
I believe our activities over the past year, coupled with our ongoing
research efforts have positioned the Trust's Portfolios and shareholders to reap
the significant benefits of global investing. I thank you for your continued
support of SEI's Portfolios and look forward to reporting our future
accomplishments.
Respectfully,
/S/ SIGNATURE
David Lee
President
<PAGE>
TABLE OF CONTENTS
================================================================================
REVIEW OF NON-U.S. EQUITY MARKETS.................................... 1
REVIEW OF NON-U.S. BOND MARKETS...................................... 3
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FUND PERFORMANCE
INTERNATIONAL EQUITY PORTFOLIO................................. 4
EMERGING MARKETS EQUITY PORTFOLIO.............................. 6
INTERNATIONAL FIXED INCOME PORTFOLIO........................... 8
STATEMENTS OF NET ASSETS............................................. 10
STATEMENTS OF ASSETS AND LIABILITIES................................. 24
STATEMENTS OF OPERATIONS............................................. 25
STATEMENTS OF CHANGES IN NET ASSETS.................................. 26
FINANCIAL HIGHLIGHTS................................................. 27
NOTES TO FINANCIAL STATEMENTS........................................ 28
REPORT OF INDEPENDENT ACCOUNTANTS.................................... 34
SHAREHOLDER VOTING RESULTS........................................... 35
NOTICE TO SHAREHOLDERS............................................... 39
<PAGE>
REVIEW OF NON-U.S. EQUITY MARKETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL EQUITY MARKET OVERVIEW
Non-U.S. markets, with the exception of Japan, generally posted
respectable gains over the past year. Overall, the Morgan Stanley EAFE Index
returned 3.2% for the year ending February 28, 1997 with Japanese shares falling
by 8.8% while stocks in other developed markets gained 18.6%. Emerging markets
gained 15.7% as measured by the IFC Investable Composite.
By region, the emerging markets of Latin America produced the highest
returns for investors, rising 28.2% as measured by the IFC's regional index.
While at the start of the Trust's fiscal year the Mexican peso crisis and the
"Tequila effect" were still on the minds of investors, steady economic growth,
continued reform and privatization measures and stable interest rates in the
U.S. provided an attractive backdrop for the region's markets. Venezuela led all
equity markets over the year, returning 130% due to lower inflation, a stable
currency and increased GDP growth. Brazilian shares were helped by privatization
activity in the electric utility and telecommunications sectors and responded
with gains of 48%. Mexican shares matched the region's return as the benefits of
the devalued peso fed through the economy and growth rates showed steady
improvement over the year.
In Europe, the strongest results were posted by many of the smaller
developed and emerging Continental markets. The success of the privatization
within the Eastern European markets and the success of the transformation to
market economies pushed stocks in Hungary and Poland higher by 70% and 46%
respectively. Finnish shares also rose by 46% to lead the developed markets in
the region. While gains here were influenced by the performance of index
heavyweight Nokia, investors responded to the progress made by the Swedish and
Spanish governments toward meeting the fiscal requirements of the European
Monetary Union. With falling bond yields proving a supportive backdrop,
restructuring activity in key sectors of both markets resulted in strong total
returns. Shares in the region's largest market, the United Kingdom, lagged other
markets in local terms but U.S. investors benefited from a strengthening
currency. The U.K. has one of the strongest economies within Europe with
expected GDP growth rates a percent higher than in Germany or France. Rising
interest rates, in response to this growth, however, limited the market's return
to 18.9% over the past year. Rising rates did support the currency, which gained
6.5% against the U.S. dollar, boosting returns to U.S. investors.
Asian markets were relative laggards over the past year. Japan, the
largest market in the region and outside the U.S., struggled with sluggish
growth and lingering questions about the health of the banking sector. After
posting flat results through November, the market went into an abrupt dive
during December and January and ended the year through February down 9% in local
terms and 21% in dollar terms. Amid concerns about the health of the economy,
the government's decision to cut spending and increase the level of consumption
taxes in its new budget undermined remaining investor confidence. The overall
fiscal tightening was prompted by the highest debt-to-GDP level among the seven
leading industrial nations. The one bright spot for the stock market was the
weakening yen which fell 12.5% over the year to (Y)120 to the dollar and
supported the export sector. Unfortunately, the yen's fall compounded
disappointing returns for U.S. investors.
1
<PAGE>
REVIEW OF NON-U.S. EQUITY MARKETS (Continued)
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
Disappointing results weren't limited to Japan as the emerging Asian
markets of Thailand and Korea both ended the past twelve months with dismal
performance. Thailand returned -49%, while Korea returned -35%. The Thai market
was negatively impacted by the slowest growth in GDP in over a decade, a high
interest rate environment, and poor corporate earnings announcements. The Korean
market was plagued by poor performance in technology stocks, and concerns by
investors over the stability of North Korea and the possible impact on the
South. On the positive side, Taiwanese shares rose more than 60% due to an
improved economic picture and renewed investor inflow after normalization of
relations with mainland China.
2
<PAGE>
REVIEW OF NON-U.S. BOND MARKETS
================================================================================
INTERNATIONAL FIXED INCOME MARKET REVIEW
Non-U.S. bond markets posted strong returns in local currency terms for
the twelve month period ending February 28, 1997, as every bond market in the
Salomon Brothers Non-U.S. World Government Bond Index outperformed the U.S.
While the U.S. economy expanded throughout the period, many other countries were
mired in slow growth and record high unemployment. This fueled gains in foreign
bond markets as central banks cut interest rates in order to spur economic
activity. However, most foreign currencies depreciated significantly versus the
U.S. dollar, which caused the Index to lag the U.S. market when translated back
into dollar terms.
Speculation on the timing and initial membership of the European Monetary
Union (EMU), which would create one common currency for all member nations,
drove both the currency and bond market returns of continental Europe for the
period. In order to qualify for the EMU, countries must meet certain fiscal
requirements outlined by the Maastricht Treaty signed in 1992. The peripheral
European markets of Italy, Spain, and Sweden rallied throughout 1996 on the
optimism that these countries would be included in the first round of membership
into the EMU scheduled to commence on January 1, 1999. Market-friendly election
results, progress towards trimming budget deficits, and mild inflation reports
fueled the optimism. However, reports surfaced in 1997 that even Germany would
not be able to meet the strict Maastricht criteria due to the stagnant European
economy. This led to speculation that the formation of the EMU would be delayed,
which in turn hurt the peripheral markets. While the rest of Europe was in an
economic slump, healthy employment and manufacturing gains in the U.K. coupled
with high relative yields attracted foreign capital inflow, which strengthened
the British pound relative to all other major currencies.
Japanese bonds outperformed U.S. bonds on a local currency basis, but a
weakening yen caused Japan to lag the U.S. in dollar terms for the period. A
slow economy kept interest rates at historical lows and boosted bond prices.
However, the yen zigzagged downward to end the period 12.5% lower versus the
U.S. dollar. A turbulent Japanese stock market and low bond yields caused
investors to exit Japanese assets in search for better returns abroad.
Relatively high yield levels and a strong U.S. equity market attracted foreign
capital and strengthened the dollar.
3
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FUND PERFORMANCE
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL EQUITY PORTFOLIO
OBJECTIVES. The International Equity Portfolio seeks to provide long-term
capital appreciation through investments in equity securities of non-U.S.
issuers. The Portfolio also seeks to provide U.S. investors with a vehicle for
international diversification, which can reduce the variability of Portfolio
returns to the extent that foreign markets have a relatively low correlation
with the U.S. market.
STRATEGY. The International Equity Portfolio is diversified across 21
markets and includes commitments to large-cap and small-cap shares. Exposure is
also maintained to growth and value styles of active management. The Portfolio
employs five sub-advisers, each providing a unique regional or style management
specialty. Allocations to the sub-advisers are carefully managed to ensure
proper geographic and market exposure. Emphasis is placed on active security
selection as the principal source of value-added as opposed to active country
allocation. The Portfolio does not hedge foreign currency exposure.
ANALYSIS. The International Equity Portfolio returned 5.7% for the year
ended February 28, 1997, outperforming the MSCI EAFE Index's return of 3.2%.
Relative performance over the twelve months was attributable to both specific
stock selection and strategic country allocation.
At the country level, our underweighting to the struggling Japanese market
provided the biggest boost to performance. As noted in the market review,
sluggish growth in Japan has depressed sentiment and limited investor interest
in the market. In Europe, our emphasis on French and Spanish shares enhanced
performance as both markets were helped by falling interest rates. Allocations
within the Deutschemark bloc were, on balance, neutral. Our overweight to Dutch
stocks was rewarded by strong performance in response to the dollar's
strengthening. In contrast, our decision to favor Swiss stocks over German
stocks (due to the perceived competitive disadvantages of Germany) hampered
results as the Swiss franc depreciated sharply over the year.
================================================================================
INTERNATIONAL EQUITY
================================================================================
AVERAGE ANNUAL TOTAL RETURN 1
- --------------------------------------------------------------------------------
One Annualized Annualized Annualized
Year 3 Year 5 Year Inception
Return Return Return to Date
- --------------------------------------------------------------------------------
Class A 5.70% 4.61% 7.79% 4.62%
- --------------------------------------------------------------------------------
Class D, w/o load 5.39% 4.24% 7.57% 5.22%*
- --------------------------------------------------------------------------------
Class D, w/load 0.15% 2.37% 6.47% 3.32%*
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN THE SEI
INTERNATIONAL EQUITY PORTFOLIO, CLASS A OR CLASS D W/LOAD, VERSUS THE MORGAN
STANLEY MSCI EAFE INDEX
[LINE GRAPH]
Morgan Stanley MSCI SEI International SEI International Equity
EAFE Index Equity Portfolio, Portfolio, Class A
Class D
10,000 9,500 10,000
8,957 9,094 9,573
8,751 9,127 9,607
8,101 8,978 9,451
7,766 9,173 9,656
10,809 11,415 12,016
10,329 10,507 11,094
12,069 12,270 13,013
12,461 12,931 13,755
1 FOR THE PERIOD ENDED FEBRUARY 28, 1997. PAST PERFORMANCE IS NO INDICATION OF
FUTURE PERFORMANCE. CLASS D SHARES WERE OFFERED BEGINNING ON MAY 1, 1994. THE
PERFORMANCE SHOWN FOR THE CLASS D SHARES PRIOR TO SUCH DATE IS BASED ON THE
PERFORMANCE OF CLASS A SHARES ADJUSTED TO REFLECT THE MAXIMUM SALES CHARGE OF
5.0% FOR THE CLASS D SHARES. CLASS A SHARES WERE OFFERED BEGINNING DECEMBER
30, 1989.
Stock and industry selection within markets provided the majority of our
outperformance over the past year. In Europe, contributions were particularly
robust in Germany and the
4
<PAGE>
Netherlands. Overweights to dollar-sensitive industries such as German chemical
and motor vehicle producers were particularly well timed. Bayer AG, for example,
announced a record year of profits, as well as making positive comments about
its existing drug pipeline while Volkswagen saw a resurgence in sales,
especially within the U.S. after cost reductions and the introduction of newer,
more updated models. Our emphasis on banking and insurance shares in the
Netherlands enhanced results as yields in the market came down by 100 basis
points over the past year. ABN Amro and ING Holdings are representative holdings
in this sector. Elsewhere in Europe, Swedish retailer Hennes & Mauritz gained
over 100% over the year on the report of record earnings.
Across the Pacific markets, results were led by our holdings in Hong Kong
and Malaysia. A revival in the property market boosted shares in Hong Kong,
particularly financial services and banking shares. Our position in HSBC, the
largest bank in the market and a core holding in the Portfolio, made the single
largest contribution to performance over the most recent twelve months. Many
analysts indicate that HSBC is the best positioned bank to take advantage of the
reversion to Chinese rule on July 1 of this year. Malaysian financial service
holdings also contributed significantly -- in particular, Rashid Hussain and MBF
Capital. Oriental Holdings, a broadly diversified holding company with
operations ranging from motorcycle manufacturing to palm oil processing was
another notable contributor.
Finally, results in Japan (the largest non-U.S. market) were on balance
neutral over the past twelve months. While specific asset selection was
disappointing, particularly within the producer goods and non-bank financial
sectors, a significant underweighting to the troubled banking sector proved
positive.
Over the past twelve months, a number of enhancements have been made to
the Portfolio. In June, our Japanese and Pacific Basin strategies were
restructured with the appointment of specific specialist sub-advisers for Large
Cap Japan, Small Cap Japan and Large Cap Pacific Basin mandates. The appointment
of Farrell-Wako Global Investment Management Inc., Seligman Henderson Co. and
Yamaichi Capital Management, Inc. to replace Schroder Capital Management
International, completed the transition to specialist sub-advisers who place
principal emphasis on stock selection. A similar transition was completed for
the European region at the end of 1996, with the appointment of Lazard London
International Investment Management to replace Morgan Grenfell Investment
Services for the Large Cap European growth mandate.
PORTFOLIO MARKET ALLOCATIONS
VERSUS MSCI EAFE INDEX
FEBRUARY 28, 1997 FEBRUARY 29, 1996
------------------ -------------------
PORTFOLIO EAFE PORTFOLIO EAFE
---------- ------ ---------- ------
Australia 3.5% 3.0% 4.1% 2.7%
Belgium 0.9% 1.3% 2.0% 1.2%
Canada 0.8% 0.0% 2.6% 0.0%
France 7.9% 7.3% 10.3% 6.4%
Germany 7.5% 8.7% 6.7% 6.7%
Hong Kong 5.5% 3.8% 2.8% 3.3%
Italy 3.5% 3.1% 1.4% 2.2%
Japan 23.0% 30.2% 35.2% 42.2%
Netherlands 5.4% 5.0% 4.1% 3.9%
New Zealand 0.6% 0.4% 0.5% 0.5%
Spain 2.6% 2.2% 3.6% 1.7%
Sweden 2.5% 2.6% 1.0% 1.7%
Switzerland 5.1% 5.9% 3.2% 5.3%
United Kingdom 16.4% 19.4% 12.0% 16.5%
All Other 5.8% 7.1% 5.0% 5.7%
Cash 9.0% 0.0% 5.5% 0.0%
---------- ------ -------- ------
100% 100% 100% 100%
========== ====== ======== ======
5
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FUND PERFORMANCE
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
EMERGING MARKETS
EQUITY PORTFOLIO
OBJECTIVES. The Emerging Markets Equity Portfolio seeks to provide
long-term capital appreciation by investing primarily in a diversified portfolio
of equity securities of emerging market issuers.
STRATEGY. The Portfolio's strategy follows a multi-manager structure in
order to reduce manager-specific risks and to better meet portfolio objectives.
The portfolio employs specialist managers focusing on regions across the
emerging markets, specifically Latin America, Asia, South Africa and the smaller
markets. The managers specializing in Latin America and Asia focus on both
top-down country allocation and bottom-up fundamental company analysis. The
South African equity specialist focuses on stock selection within the broad
equity market. The smaller markets mandate emphasizing Southern and Eastern
Europe, pursues a structured approach to capture the long-term investment
opportunity provided by these newly emerging markets.
ANALYSIS. The SIT Emerging Markets Equity Portfolio returned 18.0% for the
year ended February 28, 1997, outperforming its benchmark, the IFC Investable
Index, which ended the period up 15.7%. Country allocation and stock selection
contributed equally to performance over the past twelve months.
================================================================================
EMERGING MARKETS EQUITY
================================================================================
AVERAGE ANNUAL TOTAL RETURN 1
- --------------------------------------------------------------------------------
One Annualized
Year Inception
Return to Date
- --------------------------------------------------------------------------------
Emerging Markets Equity, Class A 18.02% 12.99%
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN THE SEI EMERGING
MARKETS EQUITY PORTFOLIO, VERSUS THE IFC INVESTABLE COMPOSITE INDEX
[LINE GRAPH]
Emerging Markets Equity Portfolio, Class A IFC Investable Composite Index
10,000 10,000
10,138 9,871
10,830 11,203
12,782 12,985
1 FOR THE PERIOD ENDED FEBRUARY 28, 1997. PAST PERFORMANCE IS NO INDICATION OF
FUTURE PERFORMANCE. CLASS A SHARES WERE OFFERED BEGINNING JANUARY 17, 1995.
Over the past year, the Portfolio underwent significant change through a
transition from a single global emerging markets manager to a multi-manager
regional structure in September, 1996. The change in strategy resulted from
extensive research by SEI into the sources of return and risk in the emerging
markets. The enhancement to the Portfolio included specialist managers covering
Latin America, Asia and South Africa as well as separate strategy for the
smallest, newly emerging economies.
For the year, performance was enhanced by our strategic country
weightings, emphasizing the smaller, faster-growing emerging markets at the
expense of the larger, nearly-developed markets. For example, the Portfolio
maintained a 7% weighting to South Africa, compared to the 14% within the IFC
Investable Index which
6
<PAGE>
contributed approximately 1.5% for the year. Reduced weighting in South Africa
and other large markets were redirected to smaller markets, which rose 39% as a
group over the past twelve months. Consistent with our policies for investing in
emerging markets, we will remain underweight to the South African market, in
favor of better opportunities for investors among the smaller, faster growing
emerging economies.
Shorter-term, tactical country decisions within Latin America also added
value over the year; in particular, an overweight to the Brazilian market. The
Portfolio maintained a 15% position on average over the past twelve months to
Brazil, compared with 11% in the benchmark, contributing 1.2% to performance. We
remain bullish on the Brazilian market and view it as the engine of growth
within the Latin American region. Much of this position was funded through a
reduced weighting to Mexico over this time period as the instability of the peso
and political uncertainty raised questions about the market's prospects. Stock
selection within Latin America also added to performance over the past year. The
Portfolio's overweight to the telecommunication and utility sectors within
Brazil contributed positively to performance, as did our position in CTC, the
largest telecommunications provider in Chile.
Within the Asian region, country allocation detracted from performance
over the year. In particular, the Portfolio's overweight to Thailand and
underweight to Taiwan. These two markets also represent the two largest changes
in country allocation over the past twelve months. The Portfolio was initially
overweight to the Thai market, however, with the inclusion of an Asian
specialist manager last Fall, the position was aggressively reduced to an
underweighting. The Portfolio's underweight to Taiwan cost 80 basis points over
the year; the Portfolio was almost 2% underweight in the Taiwanese market on
average over the past twelve months. The Taiwanese market ended the past year up
over 60%, due to an improving economy and increased liquidity flows into in the
equity market. We remain underweight in the Taiwan market, mainly due to the
more attractive valuations in mainland China.
Looking forward, we will continue to overweight Eastern Europe, Brazil and
China relative to the IFC Investable index. We will also maintain our
underweight to South Africa and Mexico.
PORTFOLIO MARKET ALLOCATIONS
VERSUS IFC INVESTABLE COMPOSITE INDEX
FEBRUARY 28, 1997 FEBRUARY 29, 1996
-------------------- -------------------
PORTFOLIO IFCI PORTFOLIO IFCI
---------- ------ ---------- ------
Argentina 4.66% 3.74% 4.90% 3.48%
Brazil 10.89% 12.39% 15.02% 10.54%
Chile 3.04% 5.37% 3.02% 6.62%
China 0.16% 0.62% 3.09% 0.52%
Colombia 0.98% 1.09% 0.00% 0.92%
Czech Republic 1.12% 0.47% 2.93% 0.78%
Greece 3.81% 1.70% 0.71% 1.74%
Hong Kong 0.94% 0.00% 0.00% 0.00%
Hungary 1.21% 0.51% 0.22% 0.41%
India 2.76% 1.97% 1.63% 2.38%
Indonesia 4.78% 4.32% 2.96% 4.63%
Jordan 0.00% 0.10% 0.00% 0.18%
Korea 2.37% 2.08% 2.64% 2.78%
Malaysia 16.26% 22.12% 15.61% 20.48%
Mexico 6.66% 9.72% 13.96% 8.78%
Pakistan 1.23% 0.66% 0.51% 0.89%
Peru 2.06% 1.06% 2.50% 1.16%
Philippines 4.00% 3.04% 3.30% 3.25%
Poland 1.14% 0.86% 0.13% 0.61%
Portugal 3.45% 1.81% 3.97% 1.44%
S. Africa 8.73% 12.69% 7.71% 17.56%
Sri Lanka 0.00% 0.05% 0.00% 0.07%
Taiwan 5.44% 7.15% 1.66% 2.70%
Thailand 2.31% 2.24% 4.13% 5.16%
Turkey 3.88% 3.25% 1.63% 3.37%
U.S. 0.76% 0.00% 0.00% 0.00%
Venezuela 2.01% 0.86% 0.00% 0.28%
Zimbabwe 0.00% 0.10% 0.00% 0.06%
Cash 5.35% 0.00% 0.00% 0.00%
----- ----- ----- -----
100% 100% 100% 100%
===== ===== ===== =====
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FUND PERFORMANCE
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL FIXED
INCOME PORTFOLIO
OBJECTIVES. The International Fixed Income Portfolio seeks to provide
capital appreciation and current income through investments in high quality,
non-U.S. dollar denominated government and corporate fixed income securities or
debt obligations. The Portfolio also seeks to provide U.S.-based investors with
a vehicle to diversify and enhance the returns of the domestic fixed income
portion of their portfolios. The Portfolio invests primarily in high-quality,
non-U.S. dollar denominated government obligations. There are no restrictions on
the Portfolio's average maturity, although the duration is expected to range
between one and nine years.
STRATEGY. Portfolio construction entails a two-stage process which
combines fundamental macroeconomic analysis and technical price analysis. First,
a fundamental judgment is made about the direction of a market's interest rates
and its currency. A technical price overlay is then applied to the fundamental
position to ensure that the Portfolio is not substantially overweighted in a
declining market or underweighted in a rising one.
Country and currency allocations are made separately. As a result, the
Portfolio's currency exposure may differ from its underlying bond holdings.
Investment will generally be diversified across 6 to 12 countries with continual
exposure to the three major trading blocs: North America, Europe, and the
Pacific Basin. Depending upon the relative fundamental and technical views, each
trading bloc is over or underweighted relative to the Portfolio's benchmark
index. Currency exposure is actively managed to maximize return and control risk
through the use of forward currency contracts and cross-currency hedging
techniques.
ANALYSIS: The International Fixed Income Portfolio gained 1.85% for the
year ended February 28, 1997, outperforming the Salomon Brothers Non-U.S.
Government Bond Index return of 0.64%. Prudent currency positions relative to
the benchmark drove outperformance for the period.
The peripheral European markets of Italy, Spain, and Sweden rallied
throughout 1996 on optimism that these countries would be included in the first
round of the European Monetary Union (EMU). The Portfolio's neutral to modestly
underweight positions in these markets dampened relative performance throughout
1996. However, the underweight helped performance in early 1997 as concerns over
a possible delay of the formation of EMU hurt the peripheral markets.
While continental Europe was plagued with slow growth throughout the
twelve-month period, the United Kingdom's economy surged. Healthy growth
prompted the U.K. to raise interest rates, which further strengthened the
British pound. The Portfolio's significant overweight to the pound during the
fourth quarter of 1996 generated outperformance.
Although the Japanese yen ended the twelve-month period nearly 13% lower
versus the U.S. dollar, it was a bumpy decline that included periods of yen
appreciation. Overweights to the yen in April and again in late February
benefited returns as the yen spiked higher during those time periods. The weak
Japanese economy buoyed bond prices, therefore slight underweights to Japanese
bonds throughout most of the period detracted from returns. Modest hedging into
the U.S. dollar enhanced results as a strong economy and relatively high U.S.
yield levels strengthened the dollar.
8
<PAGE>
================================================================================
INTERNATIONAL FIXED INCOME
AVERAGE ANNUAL TOTAL RETURN 1
================================================================================
One Annualized Annualized
Year 3 Year Inception
Return Return to Date
- --------------------------------------------------------------------------------
International Fixed
Income, Class A 1.85% 7.97% 7.77%
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN THE SEI
INTERNATIONAL FIXED INCOME PORTFOLIO, VERSUS THE SALOMON WGBI, NON-U.S.,
UNHEDGED
[LINE GRAPH]
Solomon WGBI, Non-U.S., Unhedged SEI International Fixed Portfolio, Class A
10,000 10,000
10,089 10,087
11,156 10,937
12,448 12,464
12,530 12,694
1 FOR THE PERIOD ENDED FEBRUARY 28, 1997. PAST PERFORMANCE IS NO INDICATION OF
FUTURE PERFORMANCE. CLASS A SHARES WERE OFFERED BEGINNING SEPTEMBER 1, 1993.
FUND CHARACTERISTICS
VERSUS THE SALOMON NON-U.S.
WORLD GOVERNMENT BOND INDEX (WGBI)
PORTFOLIO BENCHMARK
- --------------------------------------------------------------
Bond Currency Duration Bond/Currency Duration
Country Weighting Weighting (Years) Weighting (Years)
- --------------------------------------------------------------
Australia 1.08 1.33 5.68 1.42 4.51
Austria 0.00 0.00 0.00 1.32 4.27
Belgium 0.00 0.71 0.00 3.82 5.00
Canada 2.93 5.01 8.19 5.07 5.31
Denmark 2.98 3.82 8.41 2.31 4.84
Finland 1.15 1.14 6.72 0.76 4.40
France 13.50 -2.61 4.14 11.28 5.42
Germany 16.05 28.89 7.27 13.83 4.44
Italy 10.01 2.37 3.58 9.43 3.75
Japan 17.79 45.21 6.62 29.09 5.68
Netherlands 5.45 1.59 2.98 5.05 5.16
Norway 0.80 0.00 7.68 0.00 0.00
Spain 2.86 2.39 4.06 4.05 4.03
Sweden 1.46 1.00 4.70 2.43 4.54
Switzerland 0.00 -4.68 0.00 0.65 5.85
UK 9.38 12.62 6.99 9.09 6.12
USA 10.81 1.30 0.39 0.00 0.00
- --------------------------------------------------------------
100% 100% -- 100% --
- --------------------------------------------------------------
9
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL
EQUITY PORTFOLIO
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
FOREIGN COMMON STOCKS -- 93.8%
AUSTRALIA -- 3.6%
Amcor 48,000 $ 316
Australia & New Zealand Bank 269,984 1,686
Australian Resources 292,600 177
Bank of Melbourne 45,400 287
Boral 124,000 337
Brambles Industries 5,500 93
Broken Hill Proprietary 84,500 1,119
Capral Aluminum 204,600 705
Coles Myer 71,000 313
Commonwealth Bank of Australia 81,400 810
Consolidated Rutile 412,200 333
CRA 21,825 327
Foodland 251,900 1,213
Fosters Brewing 46,000 96
Futuris 64,890 91
General Property Trust 114,000 222
Goodman Fielder 140,000 170
Jupiters 107,600 232
Lend Lease 18,000 329
M.I.M. Holdings 138,000 192
Mayne Nickless 27,000 160
National Australia Bank 334,572 4,214
Newscorp 92,000 490
Pacific Magazines & Print 100,300 253
Pioneer 57,000 170
Qantas Airways 536,400 1,016
Qct Resouces 123,000 170
Rothmans Holdings 38,300 259
Simsmetal Limited 33,900 205
St. George Bank 145,938 873
Stockland Trust Group 49,500 127
Western Mining 79,025 498
Westpac Banking 182,807 1,036
Westpac Property Trust 155,500 215
Woodside Petroleum 35,000 237
--------
18,971
--------
AUSTRIA -- 0.2%
Brauerei Schwechat 3,700 142
Radex Heraklith 8,400 305
SCA Laakirchen 100 45
Strabag Oesterreich 1,200 70
Voest-Alpine Stahl* 7,700 306
--------
868
--------
BELGIUM -- 0.9%
Arbed 2,910 318
CMB 6,670 486
GIB 44,117 2,053
Kredietbank 2,490 901
Tractabel 2,060 894
--------
4,652
--------
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
CANADA -- 0.8%
Canadian Imperial Bank 11,100 $ 539
Cascades 43,700 265
CCL Industries, Series B 10,200 119
Methanex* 27,500 270
National Bank Canada 68,200 789
Oshawa Group 23,300 349
Rio Alto Exploration* 29,700 184
Royal Bank of Canada 30,400 1,227
Stelco* 76,200 418
--------
4,160
--------
DENMARK -- 0.9%
Den Danske Bank 27,750 2,484
FIH, Series B 10,320 257
Kobenhavns Lufthavne 15,840 1,624
Monberg & Thorsen Holding 2,400 129
--------
4,494
--------
FINLAND -- 0.2%
Enso Oy, Series A 43,300 374
Finnair, Series 1 10,000 77
Metsa Serla, Series B 44,000 368
UPM-Kymmene 10,100 213
--------
1,032
--------
FRANCE -- 8.2%
AXA - UAP 39,000 2,597
Banque National Paris 12,350 561
Bazar de L'hotel de Ville 850 81
Bertrand Faure 9,100 454
Bic 3,650 592
Bollore Technologies 2,150 245
Bongrain 825 320
Bouygues 4,600 439
C.G.I.P. 3,200 913
CIC Union Europe 2,550 162
Club Mediterranee 900 69
Colas 1,950 270
Credit Commerce France 24,200 1,135
Credit Local de France 24,500 2,448
Credit National 11,200 737
Danone 7,400 1,123
De Dietrich et Compagnie 3,410 157
Ecia 550 95
Elf Aquitaine 19,800 1,895
Elf Gabon 300 81
Eridania Beghin Say 6,900 1,116
Fimalac 1,200 112
Fructivie 500 58
Gaumont 4,300 325
Generale des Eaux 19,815 2,759
Interbail 100 4
L'Oreal 4,900 1,661
La Rochette* 7,750 42
10
<PAGE>
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Lafarge 28,915 $ 1,813
Legris Industries 4,000 190
LVMH Moet Hennessy 3,495 818
Marine Wendel 5,800 606
Michelin, Series B 23,800 1,491
Nord Est 400 11
Paribas 33,800 2,302
Parisienne de Rees 4,200 358
Pernod Ricard 14,850 811
Peugeot 18,900 2,091
Rhone Poulenc 53,000 1,861
Saint Gobain 7,950 1,173
Saint Louis-Bouchon 1,850 486
Sanofi 19,328 1,914
SAT 550 163
Scac Delmas Viel 521 105
Seita 9,100 348
SGE 4,100 95
Skis Rossignol 8,400 229
Societe Generale 11,350 1,315
Sommer Allibert 20,200 614
Total Compaigne, Series B 24,687 1,970
Union Assurances Federal 3,200 384
Valeo 14,100 951
Vallourec 7,850 464
--------
43,014
--------
GERMANY -- 7.2%
Aachener & Muenchener 493 257
Adidas AG 18,180 1,740
Agiv* 17,180 284
Andrea-Noris Zahn 2,510 905
BASF 119,700 4,417
Bayer 100,750 4,234
Bayer Vereinsbank 16,900 620
Bayerische Motoren Werke 4,328 2,912
BHF Bank 19,720 474
Binding Brauerei 300 83
CKAG Colonia Konzern 5,300 479
Continental 26,000 512
Daimler-Benz 7,300 530
DBV Holding 1,810 661
Deutche Pfandrbrief &
Hypotheken Bank 9,320 408
Deutsche Telekom 113,650 2,183
DLW* 1,450 119
Dywidag 410 59
Felten & Guilleaume 1,100 118
Franfurter Hypothekenbank
Centralboden 425 17
Gehe AG 10,000 678
Herlitz* 910 88
Holsten Brau 500 98
Industrie Werke Karls 1,200 276
Kabelmetall 1,050 101
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Kaufring* 820 $ 45
Kolbenschmidt AG* 7,300 115
Lehnkering 460 65
Lufthansa 123,000 1,640
Man 1,160 297
Mannesmann 4,700 1,859
Nuernberger BET 150 114
Papier Werke Waldhof 4,600 663
Phoenix 21,750 318
Salamander 960 112
Varta* 820 137
Veba 16,270 938
Viag 9,190 4,042
Viag AG New* 985 424
Volkswagen 9,590 4,667
Wuensche 1,500 100
--------
37,789
--------
HONG KONG -- 5.7%
Cathay Pacific Airways 675,000 1,050
Cheung Kong Holdings 148,000 1,414
China Light & Power 274,000 1,267
Dao Heng Bank Group 60,000 308
Guangdong Investment 328,000 320
Guoco Group 81,000 454
Hang Lung Development 619,000 1,247
Hang Seng Bank 50,000 578
Harbour Centre Development 43,000 64
Henderson Investment 191,000 215
Henderson Land Development 137,000 1,225
Hon Kwok Land Investment 534,000 195
Hong Kong & China Gas 166,000 315
Hong Kong Aircraft Engineering 84,800 269
Hong Kong Electric 547,000 1,893
Hong Kong Telecommunications 196,000 338
Hong Kong Telecommunications
Warrants* 400,000 13
HSBC Holdings 308,290 7,525
Hutchison Whampoa 156,000 1,189
Hysan Development 87,000 300
Jardine International Motor 262,000 337
Kowloon Motor 194,600 391
Kumagai Gumi 392,400 448
Lai Sun Garment 290,000 423
Liu Chong Hing 177,000 221
New World Development 92,000 570
Oriental Overseas International 264,000 147
Peregrine Investment Holdings 489,000 894
Semi-Tech (Global) 66,000 77
Shun Tak Holdings 684,000 481
Sun Hung Kai Properties 92,200 1,066
Swire Pacific, Series A 375,000 3,221
Tai Cheung Holdings 285,000 258
Top Glory 1,700,000 334
Wharf Holdings 100,000 444
11
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL
EQUITY PORTFOLIO--CONTINUED
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Wheelock 98,000 $ 263
Yue Yuen 949,500 389
--------
30,143
--------
IRELAND -- 0.1%
Anglo Irish Bank 115,200 154
Avonmore Food 56,700 197
Golden Vale 25,000 25
Hibernian Group 28,600 158
Irish Continental Group 13,200 120
--------
654
--------
ITALY -- 3.7%
Assicurazioni Generali 176,070 3,197
Banca di Roma* 1,498,100 1,100
Banca Popolare di Bergamo 37,600 558
Banca Popolare di Milano 83,900 459
Banca Popular di Brescia 59,400 311
Burgo (Cartiere) 131,300 602
Costa Crociere 83,000 184
Credito Bergamasco 52,000 777
Edison 325,000 1,786
ENI 353,243 1,743
Ericsson 6,400 82
Fiat 358,300 1,106
Italcementi 56,900 309
Milano Assicurazioni 32,500 90
Montedison* 3,285,300 2,371
Montefibre 95,000 58
Parmalat Finanziaria 743,100 1,022
SAI 38,900 326
SAI di Risp 47,600 174
Seat* 401,455 145
Sirti 104,600 648
Sorin Biomedica 26,900 96
Stet Soc Fin Telefonica 401,455 1,721
Toro Assicurazioni 26,600 330
Unipol 32,480 66
--------
19,261
--------
JAPAN -- 23.9%
Achilles 155,000 441
Aiya 33,000 378
Apollo Electronics 36,000 406
Asahi Bank 129,000 946
Asahi Broadcasting 1,400 124
Asatsu 31,000 831
Ashikaga Bank 235,000 786
Bank of Tokyo-Mitsubishi 112,000 1,840
Bank of Yokohama 176,000 844
Belc 12,000 139
Chiyoda Fire & Marine Insurance 145,000 613
Chuba Electric Power 65,000 1,148
Chubu Steel Plate 84,000 419
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Chubu Suisan 20,000 $ 87
Chugai Pharmaceutical 74,000 585
Chuo Warehouse 16,000 125
Comany 10,000 121
Computer Engineering
& Consult 19,000 120
Dai Nippon Ink & Chemical 296,000 936
Dai Tokyo Fire & Marine
Insurance 134,000 678
Dai-Ichi Kangyo Bank 189,000 2,070
Daido Metal 28,000 131
Daiei 112,000 741
Daiwa House Industries 330,000 3,668
Daiwa Securities 105,000 826
Danto 45,000 455
Data Communication Systems 7,000 131
Denyo 11,000 121
Dio Chemicals 22,000 137
East Japan Railway 303 1,292
Fanuc 27,900 868
Fuji Bank 55,000 643
Fuji Heavy Industries 154,000 735
Fuji Photo Film 218,000 7,306
Fujitsu Business Systems 38,000 807
Glory 43,000 763
Heiwa 50,000 693
Hitachi 234,000 2,019
Hitachi Information Systems 19,000 193
Hitachi Medical 58,000 775
Hokuriko Bank 61,000 210
Horiba 43,000 421
Horipro 23,000 200
Ichiken 63,000 231
Ichiyoshi Securities 46,000 145
Iino Kaiun* 137,000 391
Industrial Bank of Japan 93,040 1,111
Institute of General Education 17,000 126
Izumi Industries 18,000 88
Japan Energy 346,000 815
Japan Industrial Test 2,000 24
Japan Living Service 36,000 218
Japan Process Development 12,000 100
Japan Tobacco 188 1,263
Jastec 10,000 95
Joyo Bank 116,000 578
Kamigumi 104,000 549
Kansai Electric Power 66,400 1,206
Kentucky Fried Chicken Japan 35,000 479
Keyence 6,600 805
King Jim 43,000 745
Kobe Steel* 251,000 464
Kubota 179,000 815
KVK 13,000 96
Kyocera 10,000 593
Lilycolor 67,000 386
12
<PAGE>
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Lion 158,000 $ 662
Long Term Credit Bank 325,000 1,173
Marukyo 24,000 263
Matsudo Kousan 24,000 213
Matsushita Electric 211,000 3,256
Matsushita Electric Works 155,000 1,363
Minebea 48,000 397
Mitsubishi Electric 485,000 2,728
Mitsubishi Heavy Industries 230,000 1,658
Mitsubishi Motor 161,000 1,182
Mitsubishi Oil 382,000 1,591
Mitsui Petrochem 155,000 712
Miura 33,000 411
Mizuno 52,000 325
Morita Fire Pump Manufacturing 95,000 410
NAC 800 12
Nakayamafuku 16,000 114
Namura Shipbuilding 135,000 403
Nanaboshi 13,000 143
NBC Industries 9,000 119
New Oji Paper 160,000 892
NIC 39,000 440
Nihon Decoluxe 12,000 139
Nikko Securities 50,000 290
Nintendo 49,700 3,508
Nippon Computer Systems 16,000 133
Nippon Hodo 22,000 178
Nippon Kanzai 13,000 264
Nippon Meat Packers 68,000 683
Nippon Shoji Kaisha 59,000 392
Nippon Steel 275,000 732
Nippon Telegraph & Telephone 159 1,133
Nippon Yusen Kabushiki Kaishi 219,000 854
Nippondenso* 29,000 558
Nishio Rent All 29,000 387
Nissan Motors 374,000 2,209
Nittetsu Mining 65,000 419
Nomura Securities 80,000 1,068
Ohishi Sangyo 18,000 139
Ohmoriya 12,000 143
Oie Sangyo 12,000 115
Ono Pharmaceutical 20,000 644
Osaka Gas 257,000 633
Paltac 32,000 218
Pioneer Electronics 98,000 1,894
Rengo 204,000 1,015
Ricoh Elemex 11,000 124
RKB Mainichi Broadcasting 17,000 118
Roki Techno 8,000 123
Roland 25,000 435
Royal Hotel 27,000 129
Ryobi Limited 137,000 461
Ryoyo Electro 27,000 403
Sagami Chain 31,200 388
Sakura Bank 418,000 2,673
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Sanko 11,000 $ 83
Sankyu Aluminium 201,000 665
Sanwa Bank 92,000 1,061
Sanyo Electric 276,000 1,152
Sanyo Special Steel 288,000 788
Seijo 18,100 285
Seino Transportation 71,000 707
Sekisui Chemical 148,000 1,535
Sekisui House 545,000 5,063
Sekisui House Hokuriku 28,000 228
Shaddy 24,000 275
Sharp 40,000 501
Shikoku Electric Power 67,000 1,162
Shimojima 15,000 286
Shinden 13,200 134
Showa Shell Sekiyo 95,000 710
SK Kaken 11,000 185
Sotoh 53,000 400
Spancrete 19,000 137
Sumitomo 120,000 903
Sumitomo Bank 75,000 946
Sumitomo Marine and
Fire Insurance 196,000 1,135
Sun-Life 11,000 146
Takara Standard 50,000 374
Toin 18,000 130
Tokai Rika 56,000 419
Tokyo Electric Power 28,000 520
Tokyo Gas 373,000 950
Tokyo Steel 300 3
Toppan Printing 146,000 1,683
Toshiba 189,000 1,066
Toyo Ink 361,000 1,369
Toyo Trust & Banking 39,000 279
Toyota Motor 54,000 1,384
Trancom 10,000 61
Trusco Nakayama 1,700 25
Tsuba Nakashima 86,000 692
Tsudakoma 174,000 787
Tsutsumi Jewelry 18,100 378
Victor of Japan 117,000 1,116
Xebio 39,000 815
Yaizu Suisankagaku 18,700 275
Yakult Honsha 59,000 597
Yamanouchi Pharmaceutical 130,000 2,718
Yodogawa Steel Works 161,000 922
Yokohoma Rubber 205,000 842
Yonex 21,000 145
Yonkyu 8,000 133
--------
125,334
--------
MALAYSIA -- 2.4%
Angkasa Marketing 65,000 110
Arab Malaysian Finance 11,000 77
Austral Enterprises 352,000 808
13
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL
EQUITY PORTFOLIO--CONTINUED
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Bandar Raya Developments 80,000 $ 118
Berjaya Sports 27,000 157
Bousted 151,000 404
Cement Industries 17,000 52
Datuk Keramat Holdings 182,000 353
DCB Holdings 69,000 277
Diversified Resource 45,000 174
Edaran Otomobil 132,000 1,356
Hong Leong Bank 50,000 182
Hume Industries 32,000 202
IGB 142,000 174
IJM 69,000 185
IOI Properties 99,000 179
Island & Penninsular 22,000 89
Jaya Taisa Holdings 35,000 192
Kentuckey Fried Chicken Malaysia 25,000 109
Kuala Lumpur Kepong Berhad 78,000 236
Kwong Yik Bank 45,000 181
Magnum 80,000 166
Malayan Banking 46,500 553
Malaysian Airline System 76,000 202
Malaysian International Shipping 171,000 451
Malaysian Pacific Industries 165,000 685
MBF Capital 450,000 924
Metroplex 154,000 210
Multi-Purpose Holdings 167,000 397
New Straits Times Press 33,000 210
Oriental Holdings 26,000 235
Pan Pacific Asia 31,000 96
Perusahaan Otomobil 30,000 198
Renong 111,000 202
Sime Darby 93,000 352
Sime Uep Properties 99,000 267
Sungei Way Holdings 23,600 68
TA Enterprise 321,000 509
Telekom Malaysia 15,000 121
Tenaga Nasionale 62,000 297
UMW Holdings Berhad 47,000 248
United Engineers 58,000 535
Westmont Berhad Industries 118,000 240
--------
12,781
--------
NETHERLANDS -- 5.7%
ABN-Amro Holdings 40,400 2,902
ACF Holdings 11,400 183
Aegon 27,713 1,839
Ahold 29,636 1,916
Beers 5,500 205
DSM 3,400 340
Elsevier 117,050 1,875
Eriks 600 46
European Vinyls 29,700 837
Hollandsche Beton Groep 2,200 484
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Hoogovens 12,000 $ 541
Ing Groep 127,476 4,938
KLM 29,700 911
Kondor Wessels 3,900 159
KPN 18,300 656
National Invest Bank 4,200 406
Nijverdal Tencate 7,400 353
NKF Holdings 5,200 141
Oce-Van Der Grinten 15,000 1,874
Polynorm 500 39
Royal Dutch Petroleum 19,900 3,446
Stad Rotterdam 9,479 413
Unilever 13,000 2,479
Van Ommeren 9,100 388
VNU 87,000 1,802
Volker Stevin 5,200 512
--------
29,685
--------
NEW ZEALAND -- 0.7%
Air New Zealand, Series B 27,127 71
Brierley Investment 225,000 217
Carter Holt Harvey 93,879 213
Fisher & Paykel Industries 106,607 409
Fletcher Challenge Building 33,700 101
Fletcher Challenge Energy 35,500 91
Fletcher Challenge Paper 437,051 863
Independent Newspaper 13,270 63
Lion Nathan 406,348 1,002
Telecom of New Zealand 101,064 454
--------
3,484
--------
NORWAY -- 0.7%
Den Norske Bank 155,409 693
Leif Hoegh & Company 7,500 145
Norske Skog 15,800 486
SAS Norge 25,536 254
Sparebanken Norway 11,900 368
Storebrand* 290,000 1,944
--------
3,890
--------
SINGAPORE -- 1.9%
Acma 186,000 420
Amtek Engineering 131,000 265
City Developments 195,000 1,929
Cycle & Carriage 97,000 1,021
DBS Land 77,000 300
Development Bank of Singapore 25,000 332
Fraser and Neave 22,000 198
Goldtron 237,000 165
Hai Sun Hup 70,000 52
Haw Par Brothers 62,000 144
Inchcape Berhad 20,000 70
14
<PAGE>
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Industrial & Commercial Bank 62,000 $ 241
Keppel 29,000 210
Marco Polo Development 87,000 198
Natsteel 114,000 280
Overseas Chinese Banking 27,000 358
Overseas Union Bank 23,000 179
Overseas Union Enterprises 15,000 76
Pacific Carriers 235,000 178
Parkway Holdings 43,000 181
Republic Hotel and Resort 69,000 87
Singapore International Airlines 13,000 115
Singapore Press 15,880 310
Singapore Technologies Industrial 60,000 161
Ssangyong Cement 52,000 129
Straits Steamship Land 59,000 201
United Overseas Bank 29,824 339
Van Der Horst 124,000 513
Wing Tai Holdings 351,000 1,153
--------
9,805
--------
SPAIN -- 2.7%
Azucarera Espana 2,400 113
Banco de Santander 62,760 4,248
Dragados 28,700 435
Elec Reun Zaragoza 3,400 117
Empresa Nacional de Electricidad 31,000 1,893
Energia E Ind Aragonesas 26,900 162
Fomento de Construcciones
Contratas 15,100 1,305
G.E.S.A 12,300 664
Hidroelectrica del Cantabrico,
Series C 5,000 171
Iberdrola 25,000 273
Repsol 62,000 2,358
Tabacalera, Series A 11,200 507
Telefonica de Espana 65,900 1,517
Uniland 3,700 161
--------
13,924
--------
SWEDEN -- 2.6%
ASG, Series B 6,300 117
Astra, Series B 45,000 2,107
Bergman & Beving, Series B 5,000 160
Blylock & Nordsjofr, Series B 26,400 310
Catena, Series A 32,900 439
Marieberg Tidnings, Series A 6,600 183
Rottneros 113,800 133
SKF, Series B 59,200 1,414
Sparbanken Sverige, Series A 157,600 3,112
SSAB, Series B 11,700 199
Stora Kopparbergs, Series A 72,800 995
Svedala AB free 7,600 149
Swedish Match 641,700 2,286
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Trelleborg, Series B 38,800 $ 608
Trygg-Hansa, Series B 6,300 133
Volvo, Series B 56,600 1,419
--------
13,764
--------
SWITZERLAND -- 5.3%
Aare-Tessin 410 239
Adecco* 7,200 2,336
Baer Holding 900 986
Baloise 350 689
Banque Cantonale Vaud 1,120 276
BBC Brown Boveri 1,773 2,017
Bucher Holding 280 255
Ciba Specialty Rights* 2,381 151
Cie Financiere Richemont 510 717
Clariant 3,900 1,867
CS Holding* 44,970 4,801
Daetwyler Holding 160 280
EMS Chemie Holding 110 430
Internship Holding 370 191
Keramik Holding 210 107
Kw Laufenburg 850 156
Motor-Columbus 260 420
Nestle SA 480 523
Novartis* 2,381 2,725
Roche Holding 300 2,529
Swiss Bank 9,270 1,762
Union Bank of Switzerland* 2,070 1,863
Vontobel Holding 150 82
Winterthur 2,240 1,364
Zurich Versicherung 4,230 1,261
--------
28,027
--------
UNITED KINGDOM -- 16.4%
Abbey National 217,100 2,670
Albert Fisher Group 392,200 275
Alvis 60,000 128
Amec 152,200 297
Anglian Water 48,100 510
ASDA Group 1,751,800 3,187
Astec 73,500 174
Barclays Bank 97,000 1,751
Bass 48,000 668
BAT Industries 434,100 3,795
Blue Circle Industries 144,000 932
Bridon 32,500 62
British Aerospace 60,000 1,248
British Airport Authority 110,000 953
British Airways 115,000 1,181
British Petroleum 97,500 1,079
British Steel 321,300 787
British Telecommunications 339,000 2,348
British Vita 28,000 97
15
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
INTERNATIONAL
EQUITY PORTFOLIO--CONCLUDED
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
BTP 41,600 $ 181
BTR 266,000 1,033
Bullough 64,900 117
Burn Stewart Distillers 23,000 26
Cadbury Schweppes 96,000 794
Charter 18,600 225
Commercial Union 60,500 673
Cowie Group 35,566 250
Crest Nicholson 86,000 127
Davis Service Group 46,600 194
Ed and F Man 71,600 229
Electron House 30,000 97
Energy Group* 52,930 451
General Accident 119,900 1,632
General Electric 146,000 885
Glaxo Wellcome 114,000 1,930
Grampian Holdings 17,000 35
Granada Group 87,000 1,287
Guardian Royal Exchange 279,400 1,260
Guinness 264,300 1,973
Hanson 66,162 298
Harrison & Crossfield 137,000 292
Hazlewood Foods 340,400 665
Heywood Williams 125,000 517
Hillsdown Holdings 286,100 887
HSBC Holdings 53,000 1,365
Hyder 57,500 778
Iceland Frozen Foods* 546,700 792
Kenwood Appliance 19,000 43
Kingfisher 198,600 2,189
Kwik Save Group 114,400 571
Lex Service 127,000 721
London & Manchester Group 30,800 219
London Electric 34,000 390
Marston Thompson 74,100 357
National Power 139,000 1,107
Next 119,000 1,153
Northern Ireland Electricity 29,700 184
Persimmon 44,200 184
Premier Cons Oil 197,900 124
Prudential 166,000 1,535
Reckitt & Coleman 96,000 1,243
Renold 77,800 295
Reuters Holdings 138,500 1,482
RJB Mining 237,700 1,552
Royal & Sun Alliance* 357,886 2,876
RTZ 51,000 778
Safeway 189,600 1,121
Scottish Hydro-Electric 78,000 451
Scottish Power 244,283 1,396
Sedgwick Group 552,300 1,142
Severn Trent 157,700 1,836
Shell Transportation & Trading 138,000 2,342
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
South West Water 40,100 $ 450
Southern Electric 80,900 1,045
Stakis 323,400 569
Standard Chartered 73,000 1,000
Staveley Industries 23,200 67
T & N 561,400 1,476
Tarmac 225,400 376
Tate & Lyle 62,000 441
Tesco 223,800 1,235
Thames Water 125,400 1,405
Thorn 83,300 258
TI Group 94,250 813
TLG 117,000 226
Tomkins 200,000 923
Triplex Lloyd 41,000 129
TSB Lloyds Group 307,500 2,546
Unigate 99,500 739
United News & Media 84,250 971
United Utilities* 149,500 1,625
Vaux Group 42,400 197
Weir Group 192,000 651
Wessex Water 57,870 342
Whitecroft 12,100 32
Williams Holdings 180,500 939
Willis Corroon Group 134,000 333
Wolseley 95,000 731
Yorkshire Electric 13,900 202
--------
86,147
--------
Total Foreign Common Stocks
(Cost $479,767) 491,879
--------
FOREIGN PREFERRED STOCKS -- 0.8%
AUSTRALIA -- 0.0%
Newscorp 53,000 240
--------
AUSTRIA -- 0.2%
Creditanstalt Bankverein 28,900 1,107
--------
GERMANY -- 0.6%
Draegerwerk 3,200 46
Dyckerhoff 675 207
Escada 320 55
Krones 380 132
RWE 62,000 2,251
Villeroy and Boch 1,730 232
--------
2,923
--------
Total Foreign Preferred Stocks
(Cost $4,081) 4,270
--------
16
<PAGE>
- --------------------------------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) (1) VALUE (000)
- --------------------------------------------------------------------------------
FOREIGN CONVERTIBLE BOND -- 0.0%
MALAYSIA -- 0.0%
Multi-Purpose Holdings
3.000%, 12/31/01 167 $ 95
--------
Total Foreign Convertible Bond
(Cost $67) 95
--------
U.S. TREASURY OBLIGATIONS -- 0.6%
U.S. Treasury Bill
4.688%, 03/13/97 (2) 2,000 1,997
5.196%, 04/17/97 (2) 800 794
--------
Total U.S. Treasury Obligations
(Cost $2,792) 2,791
--------
REPURCHASE AGREEMENTS -- 8.8%
Morgan Stanley
5.30%, dated 02/28/97, matured
03/03/97, repurchase price
$12,372,094 (collateralized by
Federal Home Loan Bank Bond,
8.18%, due 10/17/11, par value
$12,310,000, market value
$12,721,747) (2) 12,367 12,367
State Street Bank
4.75%, dated 02/28/97,
matured 03/03/97, repurchase
price $33,920,421 (collateralized
by U.S. Treasury Bonds, 7.50%,
due 11/15/16, par value
$31,905,000, market value
$34,598,102) 33,907 33,907
--------
Total Repurchase Agreements
(Cost $46,274) 46,274
--------
Total Investments -- 104.0%
(Cost $532,981) 545,309
--------
Other Assets and Liabilities, Net -- (4.0%) (21,070)
--------
NET ASSETS:
Portfolio Shares of Class A
(unlimited authorization -- no
par value) based on 54,190,194
outstanding shares of beneficial interest 497,232
Portfolio Shares of Class D
(unlimited authorization -- no
par value) based on 18,503
outstanding shares of beneficial interest 184
Accumulated net realized gain
on investments 13,142
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Net unrealized appreciation on
forward foreign currency contracts,
future contracts, foreign currency
and translation of other assets
and liabilities in foreign currency $ 43
Net unrealized appreciation
on investments 12,328
Accumulated net investment income 1,310
--------
Total Net Assets--100.0% $524,239
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE -- CLASS A $9.67
========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE -- CLASS D $9.58
========
MAXIMUM OFFERING PRICE PER
SHARE -- CLASS D ($9.58/95%) $10.08
========
(1) IN LOCAL CURRENCY.
(2) SECURITIES SEGREGATED TO COLLATERALIZE FUTURES CONTRACTS WITH AN AGGREGATE
MARKET VALUE OF $15,157,747.
* NON-INCOME PRODUCING SECURITY.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
EMERGING MARKETS
EQUITY PORTFOLIO
FOREIGN COMMON STOCKS -- 86.3%
ARGENTINA -- 4.7%
Astra Cia Argentina de Petroleo 880,040 $ 1,576
Banco Frances ADR 67,735 1,939
Cresud* 891,900 1,713
Irsa 250,250 906
Irsa ADR 2,777 100
Sidera 464,249 1,509
Telefonica Argentina ADR 87,400 2,764
--------
10,507
--------
BRAZIL -- 1.8%
Centrais Electricas GDS 144a* 870 120
Cia Saneamento Basico* 2,835,000 446
Cia Vale Rio Doce ADR 7,800 200
Elevasdores Atlas 8,800 90
Telebras 22,200,000 2,066
Telebras ADR 10,350 1,004
--------
3,926
--------
CHILE -- 3.1%
Compania de Telecom
Chile ADR 123,927 3,625
Quimica y Minera Chile ADR 55,700 3,245
--------
6,870
--------
17
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
EMERGING MARKETS
EQUITY PORTFOLIO--CONTINUED
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
CHINA -- 0.2%
Shanghai Dajiang Group,
Series B 178,000 $ 107
Shanghai Lujiazui Finance and
Trade, Series B 239,540 196
Shanghai Yaohua Pilkington
Glass, Series B* 140,000 59
--------
362
--------
COLOMBIA -- 1.0%
Banco Gandero ADR 37,700 1,155
Banco Industrial Colombiano ADR 26,000 471
Cementos Diamante GDR 26,100 350
Cementos Paz del Rio GDR* 7,300 91
Gran Cadena Almacenes GDR 14,600 142
--------
2,209
--------
CZECH REPUBLIC -- 1.1%
CEZ* 10,100 418
Chemopetrol Group 3,900 190
IPS Praha* 9,500 103
Komercni Banka 32,216 787
Skoda* 6,600 261
SPT Telecom* 5,900 766
--------
2,525
--------
GREECE -- 3.9%
Aegek 30,070 183
Aktor 6,440 100
Alpha Credit Bank 20,890 1,815
Aluminum Company of Greece 4,150 235
Attica Enterprises 20,775 152
Commercial Bank of Greece 12,960 523
Delta Dairy 11,240 146
Elais Oleaginous 4,970 143
Ergo Bank 16,789 988
Greek Telecom 26,720 585
Hellas Can Packaging 7,070 112
Hellenic Bottling 28,765 950
Hellenic Sugar Industry 10,860 88
Heracles General Cement 19,280 273
Intracom* 10,460 355
Ionian Bank 6,110 135
Michaniki 10,030 110
National Bank of Greece 8,558 878
Papastratos Cigarettes 12,940 256
Silver & Baryte Ores Mining 4,940 89
Titan Cement Company 7,230 486
--------
8,602
--------
HONG KONG -- 1.0%
Guangdong Electric Power
Development, Series B 145,200 131
Guangdong Investment 1,000 1
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Guangshen Railway, Series H* 974,000 $ 472
GZI Transport* 13,539 8
GZI Transport Warrants* 1,907 --
Jilin Chemical Industrial,
Series H 656,000 96
Kumagai Gumi 4,000 5
Maanshan Iron & Steel, Series H 1,180,000 277
Qingling Motors, Series H 666,000 404
Shanghai Haixin Shipping,
Series H 734,000 78
Shanghai Petrochemical,
Series H 1,144,000 325
Tsingtao Brewery, Series H 236,000 94
Yizheng Chemical Fibre, Series H 952,000 223
--------
2,114
--------
HUNGARY -- 1.2%
Borsodchem* 7,500 278
Danubius Hotel* 6,690 214
Egis 6,450 382
Gedeon Richter 11,690 801
MOL 45,737 808
OTP Bank 11,104 237
--------
2,720
--------
INDIA -- 2.8%
Bajaj Auto GDR 13,900 505
BSES GDR* 65,900 1,390
EIH GDR 50,550 910
Grasim Industries GDR 33,700 511
Hindalco Industries GDR 32,900 877
Indian Hotels GDR 12,000 275
Indian Petrochemicals GDR 53,000 670
Ranbaxy Laboratories GDR 11,100 244
State Bank of India GDR* 34,100 682
Steel Authority of India GDR 18,000 162
--------
6,226
--------
INDONESIA -- 4.9%
Astra 201,000 688
Bank International Indonesia 508,000 424
Bank International
Indonesia Rights* 260,000 141
Bank International
Indonesia Warrants* 38,250 17
Ciputra Development 352,000 338
Citra Marga Nusaphala Persada 300,000 279
Daya Guna Samudera* 169,000 240
Gudang Garam 354,000 1,725
Hanjaya Mandala Sampoerna 48,000 238
Indah Kiat Pulp & Paper 448,000 332
Indofood Sukses Makmur 100,000 223
Indosat 146,500 414
Kawasan Industri Jababeka 275,666 328
18
<PAGE>
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Lippo Bank 186,000 $ 217
Matahari Putra Prima 209,000 321
Mulia Industrindo 100 --
PT Telecom ADR 42,300 1,454
Reliance Industries GDR* 77,900 1,328
Semen Gresik 110,000 325
Telekomunikasi 877,000 1,528
Telekomunikasi Indonesia 24,000 42
Tjiwi Kimia 160,216 181
--------
10,783
--------
MALAYSIA -- 16.6%
AMMB Holdings 121,000 1,141
Bandar Raya Developments 700,000 1,032
Berjaya Sports 104,000 603
DCB Holdings 557,000 2,232
DCB Holdings Warrants* 144,000 273
Diversified Resource 481,000 1,860
Hong Leong Bank 352,000 1,283
Hume Industries 159,000 1,006
IJM 558,000 1,495
IOI Properties 1,051,000 1,897
Jaya Taisa Holdings 141,000 772
KFC 154,000 670
Kuala Lumpur Kepong Berhad 328,000 991
Kwong Yik Bank 228,000 918
Larut Consolidated 380,000 621
Magnum 461,000 956
Malayan Banking 356,000 4,230
Malaysian Assurance Alliance 94,000 591
Metacorp 17,000 51
Metroplex 653,000 889
New Straits Times Press 178,000 1,133
Oriental Holdings 88,000 794
Perusahaan Otomobil 175,000 1,156
Renong 515,000 938
Rothmans of Pall Mall 95,000 985
Sime Darby 450,000 1,704
Sime Uep Properties 411,000 1,109
Sungei Way Holdings 121,600 353
Telekom Malaysia 79,000 640
Tenaga Nasionale 202,000 968
UMW Holdings Berhad 210,000 1,108
United Engineers 250,000 2,306
--------
36,705
--------
MEXICO -- 6.2%
Bufete Industrial ADR* 38,000 779
Cemex 253,500 1,021
Cemex, Series B 257,400 1,131
Empresas la Maderna 271,800 1,427
Grupo Industria Alfa, Series A 610,899 3,491
Grupo Radio Centro ADR* 51,400 495
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Grupo Tribasa ADR* 50,000 $ 344
Hylsamex* 112,000 488
Industrias Penoles 467,000 2,145
Kimberly Clark, Series A 24,000 517
San Luis 216,100 1,300
Vitro ADR 67,100 554
--------
13,692
--------
PAKISTAN -- 1.2%
Adamjee Insurance 2,850 8
D.G. Khan Cement* 55,440 23
Engro Chemicals 46,040 210
Fauji Fertilizer 194,000 382
Hub Power* 838,800 834
ICI Pakistan* 518,500 354
Muslim Commercial Bank* 136,500 135
Pakistan State Oil 51,979 404
Pakistan Telecom New Vouchers* 454,000 339
Sui Southern Gas* 112,125 90
--------
2,779
--------
PERU -- 2.1%
Banco Wiese ADR 28,700 175
Buenaventura ADR* 42,300 825
Cerveceria Backus & Johnston,
Series C 14,072 141
Compania de Minas Buenaventura,
Series T 14,100 117
Credicorp 59,688 1,373
Telefoncia del Peru ADR 66,378 1,460
Telefonica del Peru, Series B 254,900 567
--------
4,658
--------
PHILIPPINES -- 4.1%
Ayala Land, Series B 200,000 240
Ayala, Series B 996,000 1,136
Bankard* 271,000 89
C & P Homes 1,792,750 920
DMCI Holdings* 272,000 202
Fil-Estate Land 265,000 217
Filinvest Land* 1,184,000 396
International Continer
Terminal Services* 181,500 110
Manila Electric, Series B 124,400 989
Metropolitan Bank & Trust 39,700 1,102
Mondragon International
Philippines* 320,000 140
Petron 972,000 388
Phil Commercial International
Bank 26,500 385
Philippine Long Distance 8,820 518
Philippine Long Distance ADR 12,680 735
San Miguel, Series B 209,470 781
19
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
EMERGING MARKETS EQUITY
PORTFOLIO--CONTINUED
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
SM Prime Holdings 2,035,000 $ 611
Universal Robina 146,000 74
--------
9,033
--------
POLAND -- 1.2%
Agros Holdings, Series C 3,610 97
Bank Inicjatyw Gospodarczych 80,840 122
Bank Przemyslowo-Handlowy 3,338 226
Bank Rozwoju Eksportu 6,141 215
Bank Slaski 4,723 544
Debica* 6,848 204
Elektrim 33,174 336
Gorazdze 3,220 96
Okocimskie Zaklady
Piwowarskie* 10,078 67
Rolimpex 6,972 47
Stomil Olsztyn* 10,430 140
Wielkopolski Bank Kredytowy 34,128 282
Zaklady Metali 1,150 109
Zywiec 1,486 92
--------
2,577
--------
PORTUGAL -- 3.5%
Banco Comercial Portugues 91,658 1,317
Banco Espirito Santo 12,685 241
Benco Portugal de Invest 52,400 780
Banco Totta & Acores 10,080 150
Cimentos de Portugal 33,908 740
Jeronimo Martins & Filho 18,383 992
Modelo Continente 7,200 253
Mundial Confianca* 24,700 301
Portucel Industrial Empresa 23,526 141
Portugal Telecom 34,738 1,220
Semapa 13,400 270
Sonae Investimentos 24,875 791
Soporcel* 19,845 585
--------
7,781
--------
SOUTH AFRICA -- 8.9%
Amalgamated Banks of
South Africa 50,000 318
Anglo American 16,800 1,060
Anglo American Gold
Investment Company 6,900 544
Anglo American Investment Trust 21,500 761
Avmin* 104,600 459
Bonnita Holdings 336,248 263
C.G. Smith 105,000 610
Clinic Holdings 325,500 396
Compagnie Financiere Richemont* 46,100 638
De Beers Centenary* 26,900 934
Delta Electrical Industries* 46,600 128
Elandsrand Gold Mining* 18,600 96
Foodcorp 30,000 188
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Gencor* 246,500 $ 1,068
Gold Fields of South Africa 8,000 229
Housewares Group* 375,800 227
Investec Bank 10,000 313
Iscor 834,067 633
JCI* 64,000 697
Johnnies Industrial* 132,000 1,702
Liberty Life Association of Africa* 9,500 275
Malbak 78,000 376
Metropolitan Life 171,000 339
Mutual & Federal Insurance* 45,000 247
Nedcor 36,514 620
New Africa Investment, Series N* 494,961 354
Norwich Holdings* 164,000 327
Otk Holdings-Units* 517,000 652
Palabora Mining* 16,000 280
Randgold* 79,700 672
Rembrandt Group 83,400 860
Sasol 132,521 1,435
Siltek* 27,300 137
South African Breweries 11,000 329
Standard Bank* 10,000 408
Tiger Oats* 24,000 403
Western Areas Gold Mining 19,000 263
Wooltru* 91,000 466
--------
19,707
--------
SOUTH KOREA -- 2.4%
Cho Hung Bank 10,000 56
Dong-A Pharmaceuticals* 3,060 62
Dong-Ah Construction* 5,500 119
Dongah Tire* 1,428 101
Hyundai Engineering &
Construction* 5,814 127
Jinro* 4,000 73
Korea Electric Power ADR 62,050 1,117
Korea Exchange Bank* 18,320 123
Korea Fund 109,000 1,662
Korea Mobile Telecom ADR* 30,900 382
L.G. Chemical* 9,000 98
LG Information & Communication* 1,000 84
Pohang Iron & Steel ADR* 39,000 761
Samsung Display Devices* 3,270 178
Samsung Electronics
Non-voting GDS* 874 17
Samsung Electronics
New 1/2 Non-voting GDS* 3,182 142
Samsung Fire & Marine Insurance 390 156
Seoul City Gas* 1,700 100
--------
5,358
--------
TAIWAN -- 5.3%
Accton Technology GDR* 40,000 304
Acer GDR* 77,000 855
20
<PAGE>
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Advanced Semiconductor
Engineering GDR 50,000 $ 644
Asia Cement GDR 36,000 684
China Steel GDR* 35,450 669
Lite-On Technology GDR* 54,000 1,323
President Enterprises GDR* 43,000 946
ROC Taiwan Fund* 175,300 2,104
Siliconware Precision GDR 54,000 869
Taiwan American Fund* 50,000 837
Taiwan Equity Fund* 64,000 728
Yageo GDR 144A* 81,380 997
Yageo GDR 10,000 123
Yang Ming Marine Transport GDR* 56,000 753
--------
11,836
--------
THAILAND -- 2.4%
Advanced Info Service 18,000 161
Bangkok Bank 88,200 777
Banpu Public 18,432 315
Electric Generating 124,010 314
Finance One Public 95,000 99
PTT Exploration 33,000 451
Shinawatra Computer Public 21,700 186
Siam Cement 14,000 374
Siam Commercial Bank 59,000 335
Siam Makro 62,000 280
Telecomasia* 688,000 1,249
Thai Engine Manufacturing 25,000 207
Thai Farmers Bank 77,000 455
Thai Farmers Bank Warrants* 26,138 16
--------
5,219
--------
TURKEY -- 3.9%
Akbank 6,734,813 1,178
Akcansa Cimento 1,700,000 273
Aktas Elektrik Ticaret 106,054 140
Arcelik 2,147,009 358
Brisa 324,399 169
Cukurova Elektrik 212,107 362
Ege Biracilik Ve Malt Sanayii 902,850 276
Erciyas Biracilik Ve Malt Sanayii 917,447 99
Eregli Demir Ve Celik
Fabrikalari 2,165,843 375
Ihlas Gazetecil* 794,175 136
Koc Holdings 4,242,220 1,226
Migros 229,075 256
Netas 529,164 155
Otosan 331,273 194
Peg Profilo 1,030,814 111
Petkim Petrokimya 356,340 174
Petrol Ofisi 320,920 144
Tupras* 548,796 281
Turk Hava Yollari* 1,117,803 273
Turkiye Garanti Bankasi 7,635,842 684
- --------------------------------------------------------------------------------
MARKET
DESCRIPTION SHARES VALUE (000)
- --------------------------------------------------------------------------------
Turkiye Is Bankasi 4,229,408 $ 1,377
Yapi Ve Kredi Bankas 10,936,054 516
--------
8,757
--------
UNITED STATES -- 0.8%
Formosa Fund* 167 1,720
--------
VENEZUELA -- 2.0%
Banco Provincial 219,392 387
CANTV ADR* 42,700 1,356
Electricdad de Caracas 1,841,000 2,014
Mavesa ADR 26,800 178
Sivensa ADR 73,100 228
Venezolana de Cementos 133,994 384
--------
4,547
--------
Total Foreign Common Stocks
(Cost $169,318) 191,213
--------
FOREIGN PREFERRED STOCKS -- 9.3%
BRAZIL -- 9.3%
Banco Bradesco 356,269,968 2,932
Cemig 47,400,000 1,895
Copel* 77,472,000 921
Electrobras, Series B 7,536,000 3,370
Lojas Renner 7,700,000 440
Petrol Brasileiros 13,414,000 2,668
Schulz 1,200,000 21
Telebras 9,009,000 873
Telemig, Series B 13,950,000 2,044
Telerj 8,310,232 1,210
Telesp 3,074,000 834
Uniao De Bancos Brasilias 56,770,000 2,269
Usiminas Gerais 826,000,000 951
Vale Rio Doce 8,352 219
--------
20,647
--------
Total Foreign Preferred Stocks
(Cost $14,136) 20,647
--------
FOREIGN CONVERTIBLE BONDS -- 0.8%
MEXICO -- 0.6%
Alfa
8.000%, 09/15/00 $1,120 1,333
--------
TAIWAN -- 0.2%
Nanya Plastics
1.750%, 07/19/01 $ 390 448
--------
Total Foreign Convertible Bonds
(Cost $1,621) 1,781
--------
21
<PAGE>
STATEMENT OF NET ASSETS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
EMERGING MARKETS EQUITY
PORTFOLIO--CONCLUDED
- --------------------------------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) VALUE (000)
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENTS -- 5.5%
Morgan Stanley
5.30%, dated 02/28/97,
matured 03/03/97, repurchase
price $7,928,269 (collateralized
by various U.S. Treasury Notes
ranging in par value $800,000-
$6,200,000, 5.00%-6.75%, 01/31/99-
06/30/99; total market value
$8,402,737) $7,928 $ 7,928
State Street Bank
4.75%, dated 02/28/97, matured
03/03/97, repurchase price
$4,124,632 (collateralized
by U.S. Treasury Bonds, par
value $3,885,000,
11/15/16, 7.50%,
market value $4,214,565) 4,123 4,123
--------
Total Repurchase Agreements
(Cost $12,051) 12,051
--------
Total Investments -- 101.9%
(Cost $197,126) 225,692
--------
Other Assets and Liabilities, Net -- (1.9%) (4,218)
--------
NET ASSETS:
Portfolio Shares of Class A
(unlimited authorization -- no
par value) based on 17,210,088
outstanding shares of beneficial interest 193,658
Accumulated net realized loss
on investments (376)
Net unrealized appreciation on
forward foreign currency contracts,
foreign currency and translation of
other assets and liabilities in
foreign currency 11
Net unrealized appreciation
on investments 28,566
Accumulated net investment loss (385)
--------
Total Net Assets--100.0% $221,474
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE -- CLASS A $12.87
========
* NON-INCOME PRODUCING SECURITY
ADR -- AMERICAN DEPOSITORY RECEIPT
ADS -- AMERICAN DEPOSITORY SHARE
GDR -- GLOBAL DEPOSITORY RECEIPT
GDS -- GLOBAL DEPOSITORY SHARE
144A -- RESTRICTED SECURITY
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
INTERNATIONAL FIXED
INCOME PORTFOLIO
- --------------------------------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) (1) VALUE (000)
- --------------------------------------------------------------------------------
FOREIGN BONDS -- 82.1%
AUSTRALIA -- 1.0%
Australian Government
10.000%, 10/15/07 1,403 $ 1,269
Queensland Treasury
8.000%, 08/14/01 953 760
--------
2,029
--------
AUSTRIA -- 3.5%
Republic of Austria
3.750%, 02/03/09 JY 778,000 7,043
--------
CANADA -- 2.7%
Canadian Government
6.500%, 06/01/04 3,369 2,519
9.000%, 06/01/25 3,315 2,987
--------
5,506
--------
DENMARK -- 2.8%
Danish Mortgage
6.000%, 10/01/26 32,780 4,568
Kingdom of Denmark
8.000%, 03/15/06 3,185 554
7.000%, 11/10/24 3,200 486
--------
5,608
--------
FINLAND -- 1.1%
Government of Finland
7.250%, 04/18/06 10,000 2,171
--------
FRANCE -- 12.4%
Government of France
8.125%, 05/25/99 49,830 9,572
5.500%, 04/25/04 64,710 11,731
Societe Nationale Chemins Franc
6.750%, 03/01/00 JY 420,000 4,074
--------
25,377
--------
GERMANY -- 14.8%
Bundesschatzanweisungen
5.250%, 02/25/98 9,680 5,845
Deutschland Republic
6.000%, 02/16/06 28,079 17,328
6.250%, 01/04/24 10,650 6,275
KFW International Finance
6.625%, 04/15/03 1,140 733
--------
30,181
--------
ITALY -- 9.2%
Italian Government
8.500%, 08/01/99 21,525,000 13,087
8.750%, 07/01/06 8,960,000 5,744
--------
18,831
--------
22
<PAGE>
- --------------------------------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) (1) VALUE (000)
- --------------------------------------------------------------------------------
JAPAN -- 16.4%
Asian Development Bank
5.000%, 02/05/03 500,000 $ 4,863
European Investment Bank
6.625%, 03/15/00 187,000 1,813
3.000%, 09/20/06 1,000,000 8,580
Export-Import Bank
4.375%, 10/01/03 946,000 8,956
Japanese Development Bank
2.875%, 12/20/06 600,000 5,080
World Bank
4.500%, 06/20/00 250,400 2,305
4.500%, 03/20/03 195,200 1,859
--------
33,456
--------
NETHERLANDS -- 5.0%
Kingdom of Netherlands
7.500%, 06/15/99 5,390 3,074
5.750%, 01/15/04 13,140 7,172
--------
10,246
--------
NORWAY -- 0.7%
Government of Norway
6.750%, 01/15/07 9,300 1,497
--------
SPAIN -- 2.6%
Kingdom of Spain
11.300%, 01/15/02 641,520 5,382
--------
SWEDEN -- 1.3%
Kingdom of Sweden
10.250%, 05/05/03 16,800 2,739
--------
UNITED KINGDOM -- 8.6%
European Investment Bank
7.000%, 03/30/98 200 327
United Kingdom Treasury
8.000%, 12/07/00 3,490 5,893
9.000%, 08/06/12 6,110 11,409
--------
17,629
--------
Total Foreign Bonds
(Cost $175,197) 167,695
--------
U.S. TREASURY OBLIGATIONS -- 7.2%
SHORT-TERM -- 6.9%
U.S. Treasury Bill
5.066%, 05/01/97 3,022 2,996
5.172%, 07/03/97 730 717
5.113%, 08/07/97 10,580 10,340
--------
14,053
--------
- --------------------------------------------------------------------------------
FACE AMOUNT MARKET
DESCRIPTION (000) (1) VALUE (000)
- --------------------------------------------------------------------------------
LONG-TERM --0.3%
U.S. Treasury Note
5.875%, 10/31/98 400 $ 399
6.250%, 02/15/03 100 99
7.000%, 07/15/06 140 144
6.750%, 08/15/26 35 34
--------
676
--------
Total U.S. Treasury Obligations
(Cost $14,743) 14,729
--------
REPURCHASE AGREEMENT -- 2.8%
State Street Bank
4.75%, dated 02/28/97,
matured 03/03/97, repurchase
price $5,608,219 (collateralized
by U.S. Treasury Bond, par
value $5,275,000, 11/15/16,
7.5%, market value $5,720,263) 5,606 5,606
--------
Total Repurchase Agreement
(Cost $5,606) 5,606
--------
Total Investments -- 92.1%
(Cost $195,546) 188,030
--------
Other Assets and Liabilities, Net -- 7.9% 16,189
--------
Total Net Assets -- 100.0% $204,219
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE -- CLASS A $10.53
========
JY -- JAPANESE YEN
(1) IN LOCAL CURRENCY UNLESS OTHERWISE INDICATED.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
23
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (000)
================================================================================
FEBRUARY 28, 1997
-------------
INTERNATIONAL
FIXED INCOME
-------------
ASSETS:
Investment securities (Cost $195,546) $188,030
Foreign currency (Cost $7,034) 7,035
Interest receivable 3,240
Investment securities sold 9,459
Unrealized gain on forward foreign
currency contracts 1,407
Shares of beneficial interest sold 1,299
Other assets 8
----------
Total Assets 210,478
----------
LIABILITIES:
Investment securities purchased 5,974
Shares of beneficial interest redeemed 50
Payable to affiliates 102
Other liabilities 133
----------
Total Liabilities 6,259
----------
Net Assets $204,219
==========
NET ASSETS:
Portfolio shares of Class A (unlimited
authorization -- no par value)
based on 19,389,976 outstanding
shares of beneficial interest 211,450
Accumulated net realized gain on
investments 317
Net unrealized appreciation on forward
foreign currency contracts,
foreign currencies and translation of
other assets and liabilities denominated
in foreign currencies 1,279
Net unrealized depreciation
on investments (7,516)
Accumulated net investment loss (1,311)
----------
Net Assets $204,219
==========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- CLASS A $ 10.53
==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
24
<PAGE>
STATEMENT OF OPERATIONS (000)
================================================================================
FOR THE YEAR ENDED FEBRUARY 28, 1997
<TABLE>
<CAPTION>
------------- ------------ -------------
EMERGING INTERNATIONAL
INTERNATIONAL MARKETS FIXED
EQUITY EQUITY INCOME
------------- ------------ -------------
INVESTMENT INCOME:
<S> <C> <C> <C>
Dividends $11,090 $2,534 $ --
Interest 942 492 7,399
Less: Foreign Taxes Withheld (965) (158) (141)
-------- -------- --------
Total Investment Income 11,067 2,868 7,258
-------- -------- --------
EXPENSES:
Management fees 2,087 974 875
Less management fees waived (40) (249) (161)
Investment advisory fees 2,336 1,570 434
Less investment advisory fees waived (223) (309) (72)
Custodian/wire agent fees 619 771 156
Shareholder servicing fees 1,035 351 335
Less shareholder servicing fees waived (380) (351) (335)
Professional fees 144 48 43
Registration & filing fees 59 37 60
Printing fees 108 35 53
Trustee fees 25 8 7
Pricing fees 28 14 16
Distribution fees 47 1 9
Amortization of deferred organization costs -- 3 12
Miscellaneous fees 85 20 23
-------- -------- --------
Total Expenses 5,930 2,923 1,455
-------- -------- --------
NET INVESTMENT INCOME/(LOSS) 5,137 (55) 5,803
-------- -------- --------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized gain from:
Security transactions 43,134 331 2,409
Futures contracts 9 -- --
In-kind redemption 4,240 -- --
Net realized loss on forward foreign
currency contracts and foreign
currency transactions (531) (457) (1,329)
Net change in unrealized appreciation
on forward foreign currency contracts,
futures contracts, foreign currencies, and
translation of other assets and liabilities
denominated in foreign currencies 81 14 710
Net change in unrealized appreciation
(depreciation) on investments (26,307) 27,462 (6,069)
-------- -------- --------
NET INCREASE IN NET ASSETS FROM OPERATIONS $25,763 $27,295 $1,524
======== ======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
25
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (000)
================================================================================
FOR THE YEARS ENDED FEBRUARY 28, 1997 AND FEBRUARY 29, 1996
<TABLE>
<CAPTION>
---------------- ---------------- ----------------
EMERGING INTERNATIONAL
INTERNATIONAL MARKETS FIXED
EQUITY EQUITY INCOME
---------------- ---------------- ----------------
1997 1996 1997 1996 1997 1996
---------------- ---------------- ----------------
OPERATIONS:
<S> <C> <C> <C> <C> <C> <C>
Net investment income (loss) $ 5,137 $ 4,107 $ (55) $ (70) $ 5,803 $ 2,910
Net realized gain from investment transactions 47,383 21,730 331 180 2,409 2,362
Net realized gain (loss) on forward foreign currency
contracts and foreign currency transactions (531) (983) (457) (125) (1,329) 2,856
Net change in unrealized appreciation (depreciation)
on forward foreign currency contracts, futures contracts,
foreign currencies, and translation of other assets and
liabilities denominated in foreign currencies 81 1,021 14 (2) 710 97
Net change in unrealized appreciation (depreciation)
on investments (26,307) 24,496 27,462 1,050 (6,069) (2,509)
------- ------- ------- ------ ------- -------
Net increase in net assets from operations 25,763 50,371 27,295 1,033 1,524 5,716
------- ------- ------- ------ ------- -------
DIVIDENDS DISTRIBUTED FROM:
Net investment income:
Class A (3,619) (5,932) (297) (11) (6,286) (6,969)
Class D (1) (3) -- -- -- --
Net realized gains:
Class A (37,589) (28,871) (121) (143) (1,238) (665)
Class D (14) (17) -- -- -- --
------- ------- ------- ------ ------- -------
Total dividends distributed (41,223) (34,823) (418) (154) (7,524) (7,634)
------- ------- ------- ------ ------- -------
CAPITAL SHARE TRANSACTIONS(1):
Class A:
Proceeds from shares issued in merger 150,364 -- -- -- -- --
Proceeds from shares issued 333,733 203,255 163,899 64,401 146,550 70,012
Shares issued in lieu of cash distributions 31,663 20,015 383 148 6,287 6,218
Cost of shares redeemed (277,258)(219,674) (36,866) (3,547) (26,936) (32,574)
Cost of shares redeemed in-kind (46,630) -- -- -- -- --
------- ------- ------- ------ ------- -------
Increase in net assets from
Class A transactions 191,872 3,596 127,416 61,002 125,901 43,656
------- ------- ------- ------ ------- -------
Class D:
Proceeds from shares issued 183 146 -- -- -- --
Shares issued in lieu of cash distributions 15 19 -- -- -- --
Cost of shares redeemed (216) (18) -- -- -- --
------- ------- ------- ------ ------- -------
Increase (decrease) in net assets from
Class D transactions (18) 147 -- -- -- --
------- ------- ------- ------ ------- -------
INCREASE IN NET ASSETS DERIVED FROM
CAPITAL SHARE TRANSACTIONS 191,854 3,743 127,416 61,002 125,901 43,656
------- ------- ------- ------ ------- -------
Net increase in net assets 176,394 19,291 154,293 61,881 119,901 41,738
NET ASSETS:
Beginning of period 347,845 328,554 67,181 5,300 84,318 42,580
------- ------- ------- ------ ------- -------
End of period $524,239 $347,845 $221,474 $67,181 $204,219 $84,318
======= ======= ======= ====== ======= =======
(1) CAPITAL SHARE TRANSACTIONS:
Class A:
Shares issued in merger 14,954 -- -- -- -- --
Shares issued 32,925 20,144 14,081 5,959 13,451 6,081
Shares issued in lieu of cash distributions 3,215 2,037 34 1 570 559
Shares redeemed (27,199) (21,676) (3,052) (329) (2,464) (2,894)
Shares redeemed in-kind (4,462) -- -- -- -- --
------- ------- ------- ------ ------- -------
Total Class A transactions 19,433 505 11,063 5,631 11,557 3,746
------- ------- ------- ------ ------- -------
Class D:
Shares issued 18 15 -- -- -- --
Shares issued in lieu of cash distributions 1 2 -- -- -- --
Shares redeemed (21) (2) -- -- -- --
------- ------- ------- ------ ------- -------
Total Class D transactions (2) 15 -- -- -- --
------- ------- ------- ------ ------- -------
Net increase in capital shares 19,431 520 11,063 5,631 11,557 3,746
======= ======= ======= ====== ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
26
<PAGE>
FINANCIAL HIGHLIGHTS
================================================================================
FOR THE PERIODS ENDED FEBRUARY 28, OR 29,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NET ASSET DISTRIBUTIONS DISTRIBUTIONS
VALUE NET NET REALIZED AND FROM NET FROM NET ASSET NET ASSETS
BEGINNING INVESTMENT UNREALIZED INVESTMENT REALIZED CAPITAL RETURN VALUE END TOTAL END OF
OF PERIOD INCOME/(LOSS) GAINS/(LOSSES) INCOME (4) GAINS OF CAPITAL OF PERIOD RETURN PERIOD (000)
- ---------------------------------------------------------------------------------------------------------------------------
- --------------------
INTERNATIONAL EQUITY
- --------------------
CLASS A
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1997 $10.00 $ 0.09 $ 0.47 $(0.07) $(0.82) $ -- $ 9.67 5.70% $524,062
1996 9.59 0.14 1.45 (0.19) (0.99) -- 10.00 17.30 347,646
1995 11.00 0.15 (0.97) -- (0.59) -- 9.59 (7.67) 328,503
1994 8.93 0.13 2.05 (0.11) -- -- 11.00 24.44 503,498
1993 9.09 0.16 0.04 (0.36) -- -- 8.93 2.17 178,287
1992 9.56 0.19 (0.36) (0.30) -- -- 9.09 (1.63) 92,456
1991 9.62 0.18 (0.14) -- (0.01) $(0.09) 9.56 0.36 35,829
CLASS D
1997 $ 9.93 $ 0.05 $ 0.47 $(0.05) $(0.82) $ -- $ 9.58 5.39% $ 177
1996 9.56 0.04 1.50 (0.18) (0.99) -- 9.93 16.77 199
1995(1) 10.81 0.01 (0.67) -- (0.59) -- 9.56 (6.33) 51
- -----------------------
EMERGING MARKETS EQUITY
- -----------------------
CLASS A
1997 $10.93 $ 0.01 $ 1.96 $(0.02) $(0.01) $ -- $12.87 18.02% $221,474
1996 10.27 (0.02) 0.72 -- (0.04) -- 10.93 6.83 67,181
1995(2) 10.00 0.01 0.26 -- -- -- 10.27 2.70 5,300
- --------------------------
INTERNATIONAL FIXED INCOME
- --------------------------
CLASS A
1997 $10.77 $ 0.71 $(0.49) $(0.38) $(0.08) $ -- $10.53 1.85% $204,219
1996 10.42 0.58 0.89 (1.02) (0.10) -- 10.77 13.96 84,318
1995 10.23 0.43 0.40 (0.62) (0.02) -- 10.42 8.43 42,580
1994(3) 10.00 0.14 0.18 (0.09) -- -- 10.23 6.41 23,678
RATIO OF
RATIO OF NET INVESTMENT
RATIO OF EXPENSES INCOME/(LOSS)
RATIO OF NET INVESTMENT TO AVERAGE TO AVERAGE
EXPENSES INCOME/(LOSS) NET ASSETS NET ASSETS PORTFOLIO AVERAGE
TO AVERAGE TO AVERAGE (EXCLUDING (EXCLUDING TURNOVER COMMISSION
NET ASSETS NET ASSETS WAIVERS) WAIVERS) RATE RATE+
- ------------------------------------------------------------------------------------
- --------------------
INTERNATIONAL EQUITY
- --------------------
CLASS A
<S> <C> <C> <C> <C> <C> <C>
1997 1.28% 1.11% 1.42% 0.97% 117% $0.0172
1996 1.25 1.29 1.29 1.25 102 n/a
1995 1.19 1.30 1.21 1.28 64 n/a
1994 1.10 1.46 1.24 1.32 19 n/a
1993 1.10 1.80 1.53 1.37 23 n/a
1992 1.10 2.07 1.52 1.65 79 n/a
1991 1.10 3.52 1.64 2.98 14 n/a
CLASS D
1997 1.55% 0.71% 1.65% 0.61% 117% $0.0172
1996 1.65 0.58 1.90 0.33 102 n/a
1995(1) 1.47 0.42 1.48 0.41 64 n/a
- -----------------------
EMERGING MARKETS EQUITY
- -----------------------
CLASS A
1997 1.95% (0.04)% 2.55% (0.64)% 100% $0.0004
1996 1.95 (0.23) 2.72 (1.00) 104 n/a
1995(2) 1.95 1.79 4.98 (1.24) -- n/a
- --------------------------
INTERNATIONAL FIXED INCOME
- --------------------------
CLASS A
1997 1.00% 3.99% 1.39% 3.60% 352% n/a
1996 1.00 4.70 1.27 4.43 269 n/a
1995 1.00 4.68 1.30 4.38 303 n/a
1994(3) 1.00 3.81 1.61 3.20 126 n/a
<FN>
(1) INTERNATIONAL EQUITY CLASS D SHARES WERE OFFERED BEGINNING MAY 1, 1994. ALL
RATIOS FOR THAT PERIOD HAVE BEEN ANNUALIZED.
(2) EMERGING MARKETS EQUITY CLASS A SHARES WERE OFFERED BEGINNING JANUARY 17,
1995. ALL RATIOS FOR THAT PERIOD HAVE BEEN ANNUALIZED.
(3) INTERNATIONAL FIXED INCOME CLASS A SHARES WERE OFFERED BEGINNING SEPTEMBER
1, 1993. ALL RATIOS FOR THAT PERIOD HAVE BEEN ANNUALIZED.
(4) DISTRIBUTIONS FROM NET INVESTMENT INCOME INCLUDE DISTRIBUTIONS OF CERTAIN
FOREIGN CURRENCY GAINS AND LOSSES.
+ AVERAGE COMMISSION RATE PAID PER SHARE FOR SECURITY PURCHASES AND
SALES DURING THE PERIOD. PRESENTATION OF THE RATE IS ONLY REQUIRED FOR
EQUITY FUNDS FOR FISCAL YEARS BEGINNING AFTER SEPTEMBER 1, 1995.
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
27
<PAGE>
NOTES TO FINANCIAL STATEMENTS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
1. ORGANIZATION
SEI International Trust, (the "Trust") was organized as a Massachusetts business
trust under a Declaration of Trust dated June 30, 1988. The operations of the
Trust commenced on December 20, 1989.
The Trust is registered under the Investment Company Act of 1940, as
amended, as an open-end investment company with three portfolios: the
International Equity Portfolio (formerly the Core International Equity
Portfolio), the Emerging Markets Equity Portfolio and the International Fixed
Income Portfolio (together the "Portfolios"). The Trust's prospectuses provide a
description of each Funds investment objectives, policies, and strategies. The
Trust is registered to offer Class A shares of each of the Portfolios and Class
D shares of the International Equity Portfolio.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Portfolios in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates.
SECURITY VALUATION -- Investment securities that are listed on a securities
exchange for which market quotations are readily available are valued by an
independent pricing service at the last quoted sales price for such securities,
or if there is no such reported sale on the valuation date, at the most recent
quoted bid price. Unlisted securities for which market quotations are readily
available are valued at the most recent quoted bid price. Debt obligations with
sixty days or less remaining until maturity are valued at amortized cost, which
approximates market value.
FEDERAL INCOME TAXES -- It is the intention of each Portfolio to continue
to qualify as a regulated investment company and to distribute substantially all
of its taxable income. Accordingly, no provision for Federal income taxes is
required in the financial statements.
The Portfolios may be subject to taxes imposed by countries in which they
invest with respect to their investments in issuers existing or operating in
such countries. Such taxes are generally based on income earned. The Portfolios
accrue such taxes when the related income is earned.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by the custodian bank until maturity of the repurchase
agreements. Provisions of the repurchase agreements and procedures adopted by
the Trust require that the market value of the collateral, including accrued
interest thereon, is sufficient in the event of default by the counterparty.
The Portfolios may also invest in tri-party repurchase agreements.
Securities held as collateral for tri-party repurchase agreements are maintained
in a segregated account by the broker's custodian bank until maturity of the
repurchase agreement. Provisions of the agreements require that the market value
of the collateral, including accrued interest thereon, is sufficient in the
event of default by the counterparty of the Portfolio.
If the counterparty defaults and the value of the collateral declines or if
the counterparty enters an insolvency proceeding, realization of the collateral
by the Portfolio may be delayed or limited.
FOREIGN CURRENCY TRANSLATION -- The books and records of the Portfolios are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars on the following bases: (I) market value of investment securities, other
assets and liabilities at the current rate of exchange; and (II) purchases and
sales of investment securities, income and expenses at the relevant rates of
exchange prevailing on the respective dates of such transactions.
For foreign equity securities, the Portfolios do not isolate that portion
of gains and losses on investment securities which is due to changes in the
foreign exchange rates from that which is due to changes in market prices of
such securities.
The Portfolios do isolate the effect of fluctuations in foreign currency
rates when determining the gain or loss upon sale or maturity of foreign
currency denominated debt obligations for Federal income tax purposes.
28
<PAGE>
The Portfolios report gains and losses on foreign currency related
transactions as realized and unrealized gains and losses for financial reporting
purposes, whereas such gains and losses are treated as ordinary income or loss
for Federal income tax purposes.
FORWARD FOREIGN CURRENCY CONTRACTS -- The Portfolios may enter into forward
foreign currency contracts as hedges against either specific transactions,
portfolio positions or anticipated portfolio positions. The aggregate principal
amounts of the contracts are not recorded as the Portfolios do not intend to
hold the contracts to maturity. All commitments are "marked-to-market" daily at
the applicable foreign exchange rate, and any resulting unrealized gains or
losses are recorded currently. The Portfolios realize gains and losses at the
time forward contracts are extinguished. Unrealized gains or losses on
outstanding positions in forward foreign currency contracts held at the close of
the year are recognized as ordinary income or loss for federal income tax
purposes.
FUTURES CONTRACTS -- The International Equity Portfolio utilized futures
contracts during the period ended February 28, 1997. The Portfolio's investment
in these futures contracts is designed to enable the Portfolio to more closely
approximate the performance of it's benchmark index.
Initial margin deposits of cash or securities are made upon entering into
futures contracts. The contracts are marked to market daily and the resulting
changes in value are accounted for as unrealized gains and losses. Variation
margin payments are paid or received, depending upon whether unrealized losses
or gains are incurred. When the contract is closed, the Portfolio records a
realized gain or loss equal to the difference between the proceeds from (or cost
of) the closing transaction and the amount invested in the contract.
Risks related to futures contracts include the possibility that there may
not be a liquid market for the contracts, that the changes in the values of the
contract may not directly correlate with changes in the values of the underlying
securities, and that the counterparty to a contract may default on its
obligation to perform.
CLASSES -- Class-specific expenses, such as Shareholder Servicing for Class
A and 12b-1 and Transfer Agent for Class D, are borne by that class. Income,
expenses, and realized and unrealized gains/losses are allocated to the
respective classes on the basis of relative daily net assets.
EXPENSES -- Expenses that are directly related to one of the Portfolios are
charged directly to that Portfolio. Other operating expenses of the Portfolios
are prorated to the Portfolios on the basis of relative net assets.
DISTRIBUTIONS -- Distributions from net investment income and net realized
capital gains are determined in accordance with U.S. Federal income tax
regulations, which may differ from those amounts determined under generally
accepted accounting principles. These book/tax differences are either temporary
or permanent in nature. To the extent these differences are permanent, they are
charged or credited to paid in capital in the period that the difference arises.
Accordingly, for the International Equity Portfolio, $5,074,000 was
reclassified from accumulated net realized gain on investments to paid in
capital, $297,000 was reclassified from paid in capital to undistributed net
investment income, and $404,000 was reclassified from undistributed net
investment income to paid in capital. Also, $2,170,000, $623,000 and $1,624,000
was reclassified from accumulated net realized gain on investments to
undistributed net investment income in the International Equity, Emerging
Markets Equity and International Fixed Income Portfolios, respectively. In
addition, the following permanent differences primarily attributable to realized
foreign exchange gains and losses, have been reclassified from accumulated net
realized gain (loss) on foreign currency transactions to undistributed net
investment income:
(000)
----------
International Equity Portfolio $(531)
Emerging Markets Equity Portfolio (457)
International Fixed Income Portfolio (1,329)
These reclassifications have no effect on net assets or net asset value
per share.
OTHER -- Security transactions are accounted for on the trade date of the
security purchase or sale. Costs used in determining net realized capital gains
and losses on the sale of investments securities are those of the specific
securities sold. Purchase discounts and premiums on securities held by the
Portfolios are accreted and amortized to maturity using the scientific interest
method, which approxi-
29
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
mates the effective interest method. Dividend income is recognized on the
ex-dividend date and interest income is recognized using the accrual method.
3. MANAGEMENT, INVESTMENT ADVISORY AND DISTRIBUTION AGREEMENTS
SEI Fund Management (the "Manager") and the Trust are parties to a management
agreement dated August 30, 1988, under which the Manager provides management,
administrative and shareholder services to the Portfolio for an annual fee equal
to .45% of the average daily net assets of the International Equity Portfolio,
.60% of the average daily net assets of the International Fixed Income
Portfolio, and .65% of the average daily net assets of the Emerging Markets
Equity Portfolio. The Manager has voluntarily agreed to waive all or a portion
of its fees and, if necessary, reimburse other operating expenses in order to
limit the operating expenses of each Portfolio.
SEI Financial Management Corporation ("SFM") acts as the investment advisor
for the International Equity and the Emerging Markets Equity Portfolios. Under
the Investment Advisory Agreement, SFM receives an annual fee of .505% of the
average daily net assets of the International Equity Portfolio and 1.05% of the
average daily net assets of the Emerging Markets Equity Portfolio.
Pursuant to Sub-Advisory Agreements with SFM, Acadian Asset Management,
Inc., Farrell Wako Global Investment Management, Inc., Lazard London
International Investment Management Limited, Seligman Henderson Co., Yamaichi
Capital Management, Inc. and Yamaichi Capital Management (Singapore) Limited
serve as Sub-Advisers to the International Equity Portfolio, and Parametric
Portfolio Associates, Yamaichi Capital Management, Inc., Yamaichi Capital
Management (Singapore) Limited, Montgomery Asset Management, L.P., and
Coronation Asset Management (Proprietary) Limited, serve as Sub-Advisers to the
Emerging Markets Equity Portfolio.
Strategic Fixed Income, L.P., the adviser for the International Fixed
Income Portfolio, is a party to an investment advisory agreement with the Trust
dated June 15, 1993. Under the investment advisory agreement, Strategic Fixed
Income, L.P., receives an annual fee of up to .30% of the average daily net
assets of the Portfolio. Strategic Fixed Income, L.P., has voluntarily agreed to
waive all or a portion of its fee, in conjunction with the Manager, in order to
limit the total operating expenses of the Portfolio.
SEI Financial Services Company (the "Distributor"), a wholly-owned
subsidiary of SEI Investments and a registered broker-dealer, serves as each
Portfolio's distributor pursuant to a distribution agreement with the Trust.
Effective April 15, 1996, the Trust adopted a shareholder servicing plan ("the
Class A Plans") pursuant to which a shareholder servicing fee of up to .25% of
the average daily net assets attributable to the Class A shares are paid to the
Distributor. Under the Class A Plan, the Distributor may perform, or may
compensate other service providers for performing certain shareholder and
administrative services.
The International Equity Portfolio has adopted a distribution plan for its
Class D shares (the "Class D Plan") pursuant to which a 12b-1 fee of up to .30%
of the average daily net assets attributable to the Class D shares is paid to
the Distributor. As of February 28, 1997, the Distributor was taking a fee under
the Class D Plan of only .25% of the average daily net assets attributable to
Class D shares. This payment may be used to compensate financial institutions
that provide distribution-related services to their customers. Under both the
Class A Plan and the Class D Plan, the Distributor may retain as profit any
difference between the fee it receives and the amount it pays to third parties.
In addition, Class D shares incur transfer agency fee of up to .15% of the
average daily net assets. Class D is also subject to a 5% sales load on
purchases of shares.
Certain Officers and/or Trustees of the Trust are also Officers and/or
Directors of the Manager. Compensation of Officers and affiliated Trustees is
paid by the Manager.
For the year ended February 28, 1997, the Portfolios paid commissions of
$1,037,095 to affiliated broker-dealers.
4. ORGANIZATIONAL COSTS
Organizational costs have been capitalized by the Portfolios and are being
amortized using the straight line method over sixty months beginning with the
commencement of operations. In the event any of the initial shares of a
Portfolio acquired by the Manager are redeemed during the period that the
Portfolio is amortizing its organizational costs, the redemption proceeds
payable to the Manager by the Portfolio will be reduced by an amount equal to a
pro-rata portion of the unamortized organizational costs.
30
<PAGE>
5. FORWARD FOREIGN CURRENCY CONTRACTS
The Portfolios enter into forward foreign currency exchange contracts as hedges
against portfolio positions and anticipated portfolio positions. Such contracts,
which are designed to protect the value of the Portfolio's investment securities
against a decline in the value of the hedged currency, do not eliminate
fluctuations in the underlying prices of the securities; they simply establish
an exchange rate at a future date. Also, although such contracts tend to
minimize risk of loss due to a decline in the value of a hedged currency, at the
same time they tend to limit any potential gain that might be realized should
the value of such foreign currency increase.
The following forward foreign currency contracts were outstanding at
February 28, 1997:
IN UNREALIZED
MATURITY CONTRACTS TO EXCHANGE APPRECIATION
DATES DELIVER/RECEIVE FOR (DEPRECIATION)
- ---------------- --------------- -------- --------------
INTERNATIONAL FIXED INCOME PORTFOLIO:
- -------------------------------------
FOREIGN CURRENCY SALES:
3/7/97 AD 48,292 $ 37,638 $ 138
3/7/97 CD 13,891,691 10,359,957 192,008
3/7/97-3/26/97 CH 99,900,775 70,049,749 2,204,423
3/7/97 DK 45,854,894 7,415,953 289,506
3/7/97-3/26/97 DM 126,458,664 77,009,372 2,020,174
3/7/97 FF 170,389,745 31,493,687 1,568,978
3/7/97-3/26/97 IT 81,399,998,771 50,542,247 2,417,418
3/7/97-3/26/97 JY 7,646,922,189 63,498,777 29,510
3/7/97-3/26/97 NG 25,867,701 14,363,204 724,585
3/7/97 NK 46,989,905 7,050,853 63,474
3/7/97 SK 34,997,649 4,917,298 248,161
3/7/97-3/26/97 SP 1,436,149,697 10,490,853 471,448
3/7/97 UK 41,599,952 67,843,570 123,177
------------ -----------
$415,073,158 $10,353,000
============ -----------
FOREIGN CURRENCY PURCHASES:
3/7/97 AD 780,424 $ 605,375 $ 657
3/7/97 BF 50,165,364 1,510,939 (69,589)
3/7/97 CD 18,810,147 14,062,856 (294,869)
3/7/97-3/26/97 CH 85,965,952 60,963,402 (2,576,018)
3/7/97 DK 58,754,830 9,434,592 (303,328)
3/4/97-3/26/97 DM 183,510,219 111,628,479 (2,823,960)
3/26/97 FF 13,084,524 2,315,845 (15,187)
3/7/97-3/26/97 IT 56,966,171,560 35,180,353 (1,495,885)
3/7/97-3/26/97 JY 13,380,588,076 110,995,555 108,069
3/7/97 NK 36,884,826 5,702,339 (217,581)
3/7/97 SK 28,013,035 3,823,748 (86,449)
3/7/97 SP 1,071,840,260 7,810,177 (332,008)
3/7/97-3/26/97 UK 42,020,948 69,238,856 (840,147)
------------ -----------
$433,272,516 $(8,946,295)
============ ===========
CURRENCY LEGEND
AD Australian Dollar IT Italian Lira
BF Belgian Franc JY Japanese Yen
CD Canadian Dollar NG Netherlands Guilder
CH Swiss Frank NK Norwegian Krone
DK Danish Kroner SK Swedish Krona
DM German Mark SP Spanish Peseta
FF French Franc UK British Pounds Sterling
6. INVESTMENT TRANSACTIONS
The cost of security purchases and the proceeds from the sale of securities,
other than short-term investments and U.S. government securities, during the
period ended February 28, 1997, were as follows:
PURCHASES SALES
(000) (000)
--------- --------
International Equity Portfolio $563,129 $517,597
Emerging Markets Equity Portfolio 211,171 140,900
International Fixed Income Portfolio 544,305 437,661
The International Fixed Income Portfolio purchased $9,556,104 and sold
$9,348,372 in U.S. government securities, during the period ended February 28,
1997.
For Federal income tax purposes, the cost of securities owned at February
28, 1997 and the net realized gains or losses on securities sold for the period
then ended was not materially different from the amounts reported for financial
reporting purposes. The aggregate gross unrealized appreciation and depreciation
at February 28, 1997 for the Portfolios is as follows:
NET
APPRECIATED DEPRECIATED UNREALIZED
SECURITIES SECURITIES APPRECIATION
(000) (000) (000)
----------- ----------- ------------
International Equity
Portfolio $49,068 $(36,740) $12,328
Emerging Markets Equity
Portfolio 33,075 (4,509) 28,566
International Fixed
Income Portfolio 211 (7,727) (7,516)
Internal Revenue Code regulations permit the Fund to defer into its next
fiscal year net realized losses incurred from each November 1 to the end of
31
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Concluded)
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
its fiscal year ("post-October losses"). From November 1, 1996 through February
28, 1997, the International Equity, Emerging Markets Equity and International
Fixed Income Portfolios incurred net realized foreign currency exchange losses
of $217,570, $116,203 and $1,586,983, respectively, which have been deferred to
the fiscal year ending February 28, 1998.
7. FUTURES CONTRACTS
The International Equity Portfolio had the following futures contracts open as
of February 28, 1997:
CONTRACT NUMBER OF TRADE SETTLEMENT UNREALIZED
DESCRIPTION CONTRACTS PRICE MONTH GAIN/(LOSS)
- ------------- --------- ----- ---------- -----------
IBEX 35 Index 20 5,464.50 March 1997 $(26,020)
IBEX 35 Index 1 5,415.00 March 1997 (956)
IBEX 35 Index 1 5,418.00 March 1997 (977)
IBEX 35 Index 4 5,341.00 March 1997 (1,758)
IBEX 35 Index 2 5,355.00 March 1997 (1,074)
IBEX 35 Index 3 5,333.00 March 1997 (1,151)
IBEX 35 Index 1 5,361.00 March 1997 (579)
CAC 40 Index 3 2,609.50 March 1997 1,514
CAC 40 Index 5 2,637.13 March 1997 (2,326)
CAC 40 Index 1 2,635.00 March 1997 (391)
CAC 40 Index 8 2,582.00 March 1997 11,760
CAC 40 Index 2 2,563.50 March 1997 4,239
CAC 40 Index 2 2,572.00 March 1997 3,642
CAC 40 Index 1 2,612.63 March 1997 395
CAC 40 Index 2 2,622.63 March 1997 88
CAC 40 Index 1 2,637.13 March 1997 (465)
DAX Index 1 3,196.00 March 1997 3,842
DAX Index 2 3,253.00 March 1997 931
DAX Index 1 3,258.00 March 1997 169
DAX Index 3 3,197.00 March 1997 11,348
DAX Index 1 3,175.00 March 1997 5,086
DAX Index 1 3,196.00 March 1997 3,842
DAX Index 1 3,245.00 March 1997 939
DAX Index 1 3,275.00 March 1997 (838)
FT-SE 100 Index 1 4,294.00 March 1997 (377)
FT-SE 100 Index 2 4,297.00 March 1997 (998)
FT-SE 100 Index 1 4,320.00 March 1997 (1,437)
FT-SE 100 Index 1 4,322.00 March 1997 (1,519)
FT-SE 100 Index 1 4,323.00 March 1997 (1,560)
FT-SE 100 Index 1 4,335.00 March 1997 (2,049)
FT-SE 100 Index 5 4,328.00 March 1997 (8,818)
FT-SE 100 Index 1 4,323.00 March 1997 (1,560)
FT-SE 100 Index 2 4,314.00 March 1997 (2,385)
FT-SE 100 Index 1 4,341.00 March 1997 (2,294)
FT-SE 100 Index 1 4,328.00 March 1997 (1,764)
FT-SE 100 Index 1 4,320.00 March 1997 (1,437)
CONTRACT NUMBER OF TRADE SETTLEMENT UNREALIZED
DESCRIPTION CONTRACTS PRICE MONTH GAIN/(LOSS)
- ------------- --------- ----- ---------- -----------
Hang Seng Index 4 13,600.00 March 1997 (8,652)
Hang Seng Index 3 13,060.00 March 1997 3,971
Hang Seng Index 1 13,450.00 March 1997 (1,194)
Hang Seng Index 1 13,620.00 March 1997 (2,292)
Hang Seng Index 1 13,440.00 March 1997 (1,130)
Australia Ords Index 1 2,442.00 March 1997 (299)
Australia Ords Index 2 2,445.00 March 1997 (714)
Australia Ords Index 3 2,500.00 March 1997 (4,273)
Australia Ords Index 4 2,486.00 March 1997 (4,611)
Australia Ords Index 1 2,456.00 March 1997 (571)
Australia Ords Index 1 2,481.00 March 1997 (1,056)
Australia Ords Index 1 2,494.00 March 1997 (1,308)
Australia Ords Index 1 2,465.00 March 1997 (745)
Australia Ords Index 1 2,455.00 March 1997 (551)
Nikkei 225 Index 6 18,140.00 March 1997 11,061
Nikkei 225 Index 4 18,100.00 March 1997 8,037
Nikkei 225 Index 4 17,890.00 March 1997 11,517
Nikkei 225 Index 11 18,700.00 March 1997 (5,241)
Nikkei 225 Index 3 18,560.00 March 1997 311
Nikkei 225 Index 2 18,660.00 March 1997 (621)
Nikkei 225 Index 12 18,800.00 March 1997 (10,689)
Nikkei 225 Index 3 19,175.00 March 1997 (7,333)
Nikkei 225 Index 2 19,160.00 March 1997 (4,764)
Nikkei 225 Index 5 18,840.00 March 1997 (5,282)
Nikkei 225 Index 2 18,990.00 March 1997 (3,356)
---------
$(20,486)
=========
8. CONCENTRATION OF RISKS
Each Portfolio invests in securities of foreign issuers in various countries.
These investments may involve certain considerations and risks not typically
associated with investments in the United States, as a result of, among other
factors, the possibility of future political and economic developments and the
level of governmental supervision and regulation of securities markets in the
respective countries. The International Fixed Income Portfolio invests in debt
securities, the market value of which may change in response to interest rate
changes. Also, the ability of the issuers of debt securities held by the
International Fixed Income Portfolio to meet its obligations may be affected by
economic and political developments in a specific country, industry or region.
32
<PAGE>
9. FUND MERGERS
Effective March 25, 1996, all the assets and liabilities of the European Equity
Portfolio and Pacific Basin Equity Portfolio were transferred to the
International Equity Portfolio in a tax-free reorganization pursuant to a
Reorganization Agreement approved by the shareholders. The net asset value of
the European Equity and Pacific Basin Equity Portfolios of $81,709,082 and
$68,655,364, respectively, which included unrealized appreciation on securities
of $10,123,410 and $2,186,528, respectively, and unrealized depreciation in
foreign currency of $2,170 and $329, were transferred to the International
Equity Portfolio, in exchange for 8,126,302 and 6,828,057 shares respectively,
of the International Equity Portfolio; those shares were then distributed to
shareholders in liquidation of the European Equity and Pacific Basin Equity
Portfolios.
33
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
To the Shareholders and Trustees
SEI International Trust
In our opinion, the accompanying statements of net assets (and, for
International Fixed Income Portfolio, the statement of assets and liabilities)
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 International Equity, Emerging Markets Equity and International
Fixed Income Portfolios (constituting SEI International Trust, hereafter
referred to as the "Trust") at February 28, 1997, the results of each of their
operations for the year then ended, the changes in each of their 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 generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Trust's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at February 28, 1997 by correspondence with the
custodian and, with respect to unsettled securities transactions, the
application of alternative auditing procedures, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
Philadelphia, PA
April 9, 1997
34
<PAGE>
SHAREHOLDERS VOTING RESULTS (UNAUDITED)
================================================================================
There was a special meeting scheduled for March 15, 1996 at which the
shareholders of the International Equity Portfolio (the "Portfolio") voted on a
series of proposals (the "Proposals"). The proposals and the results of the
shareholder meeting are set forth below.
PROPOSAL 1: To approve or disapprove the selection of Schroder Capital
Management International Limited ("Schroder") as Investment Sub-Adviser for the
Portfolio, and to approve or disapprove the Investment Sub-Advisory Agreement
between SEI Financial Management Corporation ("SFM" or "Adviser") and Schroder
relating to the Portfolio.
SHARES VOTED
------------
For 17,659,400
Against 45,468
Abstain 167,635
Broker Non-Vote 0
PROPOSAL 2: To approve or disapprove the selection of Morgan Grenfell Investment
Services Limited ("Morgan Grenfell") as Investment Sub-Adviser for the
Portfolio, and to approve or disapprove the Investment Sub-Advisory Agreement
between SFM and Morgan Grenfell relating to the Portfolio.
SHARES VOTED
------------
For 17,677,064
Against 40,629
Abstain 154,810
Broker Non-Vote 0
PROPOSAL 3: To approve or disapprove an Amended Investment Sub-Advisory
Agreement between SFM and Acadian Management, Inc. ("Acadian") which would
increase the sub-advisory fee paid to Acadian by SFM.
SHARES VOTED
------------
For 16,911,937
Against 389,829
Abstain 169,555
Broker Non-Vote 401,182
PROPOSAL 4: To approve or disapprove an Amended Investment Advisory Agreement
between the Portfolio and SFM which would increase the advisory fee paid to SFM.
SHARES VOTED
------------
For 16,873,568
Against 427,017
Abstain 170,736
Broker Non-Vote 401,182
There was a special meeting scheduled for March 15, 1996 at which the
shareholders of the European Equity and Pacific Basin Equity Funds (the
"Portfolios") voted on a proposal (the "Proposal"). The proposal and results of
the shareholder meeting are set forth below.
PROPOSAL 1: The approval or disapproval of an Agreement and Plan of
Reorganization and Liquidation providing for (i) the transfer of substantially
all of the assets and liabilities of the European Equity and the Pacific Basin
Equity Portfolio to the International Equity Portfolio in exchange for Class A
Shares of the International Equity Portfolio; (ii) the distribution of the
International Equity Portfolio Shares so received to shareholders of the Pacific
Basin Equity Portfolio; and (iii) the termination under state law of the Pacific
Basin Equity Portfolio.
European Equity Portfolio:
SHARES VOTED
------------
For 3,063,788
Against 46,127
Abstain 50,364
Pacific Basin Equity Portfolio:
SHARES VOTED
------------
For 3,582,944
Against 66,922
Abstain 49,330
35
<PAGE>
SHAREHOLDERS VOTING RESULTS (CONTINUED) (UNAUDITED)
================================================================================
There was a special meeting scheduled for April 30, 1996 at which the
shareholders of the International Fixed Income Portfolio (the "Portfolio") voted
on a series of proposals ("the Proposals"). The meeting was adjourned until June
28, 1996, however, none of the Proposals passed due to a failure to reach quorum
within 60 days of the meeting date. The Proposals and results of the shareholder
meeting are set forth below.
PROPOSAL 1: To eliminate the Portfolio's fundamental limitations concerning
diversification and the acquisition of more than 10% of the outstanding voting
securities of any one issuer.
SHARES VOTED
------------
For 3,077,302
Against 511,516
Abstain 129,733
PROPOSAL 2: To amend the Portfolio's fundamental limitation concerning industry
concentration.
SHARES VOTED
------------
For 3,300,537
Against 264,782
Abstain 153,232
PROPOSAL 3: To amend the Portfolio's fundamental limitation concerning borrowing
to enhance the Portfolio's ability to borrow money.
SHARES VOTED
------------
For 3,253,043
Against 299,939
Abstain 165,569
PROPOSAL 4: To amend the Portfolio's fundamental limitation concerning making
loans to enhance the Portfolio's ability to make loans.
SHARES VOTED
------------
For 3,285,583
Against 296,625
Abstain 136,343
PROPOSAL 5: To reclassify the Portfolio's fundamental limitation concerning
pledging assets as non-fundamental, and to amend certain language.
SHARES VOTED
------------
For 3,292,908
Against 258,736
Abstain 166,908
PROPOSAL 6: To reclassify the Portfolio's fundamental limitation concerning
investment in securities for the purpose of exercising control as
non-fundamental.
SHARES VOTED
------------
For 3,355,129
Against 219,874
Abstain 143,548
PROPOSAL 7: To amend the Portfolio's fundamental limitation concerning
investment in real estate and commodities to clarify the Portfolio's ability to
invest in commodities contracts relating to financial instruments.
SHARES VOTED
------------
For 3,182,261
Against 404,927
Abstain 131,363
PROPOSAL 8: To reclassify the Portfolio's fundamental limitation concerning
short sales and margin sales as non-fundamental, and to amend certain language.
SHARES VOTED
------------
For 3,145,445
Against 438,897
Abstain 134,209
36
<PAGE>
PROPOSAL 9: To reclassify the Portfolio's fundamental investment limitation
concerning investment in securities of investment companies as non-fundamental,
and to amend certain language.
SHARES VOTED
------------
For 3,338,906
Against 242,612
Abstain 137,032
PROPOSAL 10: To amend the Portfolio's fundamental limitation concerning the
issuance of senior securities to clarify the Portfolio's ability to issue senior
securities.
SHARES VOTED
------------
For 3,138,395
Against 446,834
Abstain 133,322
PROPOSAL 11: To reclassify the Portfolio's fundamental limitation concerning
investment in securities of an issuer whose securities are owned by officers and
trustees of the Trust as non-fundamental.
SHARES VOTED
------------
For 3,040,487
Against 547,917
Abstain 130,147
PROPOSAL 12: To reclassify the Portfolio's fundamental limitation concerning
investment of more than 5% of total assets in securities of companies with less
than three years of operating history as non-fundamental.
SHARES VOTED
------------
For 3,312,687
Against 281,404
Abstain 124,460
PROPOSAL 13: To reclassify the Portfolio's fundamental limitation concerning
investment in restricted securities as non-fundamental, and to amend certain
language.
SHARES VOTED
------------
For 3,080,522
Against 503,929
Abstain 134,100
PROPOSAL 14: To authorize the Board of Trustees to appoint additional or
replacement sub-advisers for the Portfolio without seeking approval of the
Shareholders of the contracts pursuant to which such sub-advisers serve.
SHARES VOTED
------------
For 3,361,475
Against 179,242
Abstain 177,834
PROPOSAL 15: To approve the selection of SFM as the Investment Adviser for the
Portfolio, and to approve the Investment Advisory Agreement between the Trust,
on behalf of the Portfolio, and SFM.
SHARES VOTED
------------
For 3,469,393
Against 119,067
Abstain 130,091
PROPOSAL 16: To approve the selection of Strategic Fixed Income, L.P.
("Strategic") as an investment sub-adviser for the Portfolio, and to approve the
form of investment sub-advisory agreement between SFM and Strategic.
SHARES VOTED
------------
For 3,433,005
Against 122,045
Abstain 163,501
37
<PAGE>
SHAREHOLDERS VOTING RESULTS (CONCLUDED) (UNAUDITED)
================================================================================
There was a special meeting scheduled for July 5, 1996 at which the
shareholders of the SEI International Trust voted on a proposal to elect a new
Board of Trustees. Due to a lack of quorum on July 5, 1996, the meeting was
adjourned until August 14, 1996. The name of each Trustee elected at the meeting
and the results of the Shareholder Vote are listed below. There are no
additional trustees whose term of office continued after the meeting.
PROPOSAL 1: To consider and act upon a proposal to elect a Board of Trustees.
TRUSTEE SHARES SHARES
- -------- ------ ------
VOTED WITHHELD
------ --------
"FOR" AUTHORITY
------ ---------
Robert A Nesher 41,157,709 273,208
Frank E. Morris 41,160,705 270,212
William M. Doran 41,162,075 268,842
F. Wendell Gooch 41,163,507 267,410
James M. Storey 41,162,075 268,842
George J. Sullivan, Jr. 41,162,075 268,842
38
<PAGE>
NOTICE TO SHAREHOLDERS (UNAUDITED)
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
For shareholders that do not have a February 28, 1997 taxable year end, this
notice is for informational purposes only. For shareholders with a February 28,
1997 taxable year end, please consult your tax advisor as to the pertinence of
this notice.
For the fiscal year ended February 28, 1997 the Portfolios of the SEI
International Trust are designating long term capital gains and qualifying
dividend income with regard to distributions paid during the year as follows:
(A) (B)
LONG TERM ORDINARY
CAPITAL GAINS INCOME TOTAL
DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTIONS
PORTFOLIO (TAX BASIS) (TAX BASIS) (TAX BASIS)
- ---------- ------------- ------------- -------------
International Equity 59% 41% 100%
Emerging Markets Equity 1% 99% 100%
International Fixed Income 2% 98% 100%
(C) (D) (E)
QUALIFYING TAX-EXEMPT FOREIGN
PORTFOLIO DIVIDENDS(1) INTEREST TAX CREDIT
- ---------- ------------ ---------- ----------
International Equity 0% 0% 40%(3)
Emerging Markets Equity 0% 0% 40%
International Fixed Income 0% 0% 0%
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction.
(2) See attached notice which details the per share amount of foreign taxes
paid by country and the per share amount of each dividend that represents
income derived from sources within each country.
(3) This amount represents the Foreign Tax Credit for Class A. The Foreign Tax
Credit for Class D is 59%.
* Items (A) and (B) are based on the percentage of each fund's total
distribution.
** Item (C) and (E)are based on the percentage of ordinary income of each fund.
*** Item (D) is based on the percentage of gross income of each fund.
39
<PAGE>
NOTICE TO SHAREHOLDERS (CONCLUDED) (UNAUDITED)
================================================================================
SEI INTERNATIONAL TRUST -- FEBRUARY 28, 1997
FOR TAXPAYERS FILING ON A CALENDAR YEAR BASIS, THIS NOTICE IS FOR INFORMATIONAL
PURPOSES ONLY.
The SEI International Trust International Equity Portfolio and Emerging Markets
Equity Portfolio have made an election under Section 853 of the Internal Revenue
Code (the "Code") to provide a foreign tax deduction or credit to their
shareholders for the fiscal year ended February 28, 1997. The information
provided below is pertinent to taxpayers who meet the following two criteria: 1)
file a U.S. Federal Income Tax Return and 2) held shares of the Portfolio on the
dividend record date of December 31, 1996 and satisfy the applicable
requirements of the Code.
The amount per share of income from and foreign taxes paid to each country
is listed in the following schedules:
INTERNATIONAL EQUITY PORTFOLIO
CLASS A CLASS D
GROSS FOREIGN GROSS FOREIGN
COUNTRY DIVIDEND TAXES PAID DIVIDEND TAXES PAID
Australia $0.0059 $0.0007 $0.0042 $0.0007
Austria 0.0004 0.0001 0.0003 0.0001
Belgium 0.0026 0.0007 0.0020 0.0007
Canada 0.0026 0.0008 0.0020 0.0008
Denmark 0.0005 0.0002 0.0004 0.0002
Finland 0.0004 0.0001 0.0003 0.0001
France 0.0086 0.0031 0.0068 0.0031
Germany 0.0049 0.0012 0.0037 0.0012
Hong Kong 0.0041 0.0000 0.0028 0.0000
Ireland 0.0000 0.0000 0.0000 0.0000
Italy 0.0021 0.0006 0.0016 0.0006
Japan 0.0121 0.0039 0.0094 0.0039
Malaysia 0.0023 0.0010 0.0018 0.0010
Netherlands 0.0074 0.0024 0.0059 0.0024
New Zealand 0.0014 0.0004 0.0011 0.0004
Norway 0.0013 0.0004 0.0010 0.0004
Singapore 0.0020 0.0009 0.0016 0.0009
Spain 0.0050 0.0015 0.0039 0.0015
Sweden 0.0017 0.0006 0.0013 0.0006
Switzerland 0.0023 0.0007 0.0018 0.0007
United
Kingdom 0.0319 0.0103 0.0248 0.0103
United States 0.0046 0.0000 0.0031 0.0000
-------- ------- -------- -------
$0.1041 $0.0296 $0.0798 $0.0296
======== ======= ======== =======
EMERGING MARKETS EQUITY PORTFOLIO
GROSS FOREIGN
COUNTRY DIVIDEND TAXES PAID
Argentina $0.0004 $0.0000
Brazil 0.0060 0.0019
Czech Republic 0.0008 0.0002
Greece 0.0004 0.0000
Hong Kong 0.0003 0.0000
Hungary 0.0000 0.0000
Indonesia 0.0007 0.0004
Israel 0.0000 0.0000
Mexico 0.0011 0.0000
Malaysia 0.0044 0.0031
Peru 0.0002 0.0000
Philippines 0.0003 0.0002
Pakistan 0.0000 0.0000
Poland 0.0000 0.0000
Portugal 0.0008 0.0001
Thailand 0.0003 0.0001
Turkey 0.0001 0.0000
Venezuela 0.0000 0.0000
South Africa 0.0024 0.0009
Switzerland 0.0000 0.0000
United States 0.0068 0.0002
-------- --------
$0.0250 $0.0071
======== ========
40
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
================================================================================
SEI INTERNATIONAL TRUST
================================================================================
ANNUAL REPORT
================================================================================
FEBRUARY 28, 1997
Robert A. Nesher
CHAIRMAN
TRUSTEES
William M. Doran
F. Wendell Gooch
Frank E. Morris
James M. Storey
George J. Sullivan, Jr.
OFFICERS
David G. Lee
PRESIDENT AND CHIEF EXECUTIVE OFFICER
Mark E. Nagle
CONTROLLER, CHIEF FINANCIAL OFFICER
Marc H. Cahn
VICE PRESIDENT, ASSISTANT SECRETARY
Todd Cipperman
VICE PRESIDENT, ASSISTANT SECRETARY
Barbara A. Nugent
VICE PRESIDENT, ASSISTANT SECRETARY
Sandra K. Orlow
VICE PRESIDENT, ASSISTANT SECRETARY
Kevin P. Robins
VICE PRESIDENT, ASSISTANT SECRETARY
Kathryn L. Stanton
VICE PRESIDENT, ASSISTANT SECRETARY
Richard W. Grant
SECRETARY
INVESTMENT ADVISORS
INTERNATIONAL EQUITY PORTFOLIO
SEI Financial Management Corporation
EMERGING MARKETS EQUITY PORTFOLIO
SEI Financial Management Corporation
INTERNATIONAL FIXED INCOME PORTFOLIO
Strategic Fixed Income L.P.
MANAGER AND SHAREHOLDER SERVICING AGENT
SEI Fund Management
DISTRIBUTOR
SEI Financial Services Company
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
THIS ANNUAL REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED
FOR THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE TRUST AND MUST BE
PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS. SHARES OF THE SEI FUNDS ARE NOT
DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK. THE SHARES
ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC),
THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENT AGENCY. INVESTMENT IN THE
SHARES INVOLVES RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. SEI FINANCIAL
SERVICES COMPANY, THE DISTRIBUTOR OF THE SEI FUNDS, IS NOT AFFILIATED WITH ANY
BANK.
FOR MORE INFORMATION CALL 1-800-DIAL-SEI/1-800-342-5734
<PAGE>
[SEI LOGO]
FINANCIAL
SERVICES
COMPANY
Oaks, PA 19456-1100
800-DIAL-SEI/800-342-5734
SEI-F-018-06
