Warburg Pincus Advisor Funds April 30, 1999
International Equity Fund
Emerging Markets Fund
Global Post-Venture Capital Fund
[LOGO]
SEMIANNUAL REPORT
More complete information about the funds, including charges and expenses, is
provided in the Prospectus, which must precede or accompany this document and
which should be read carefully before investing. You may obtain additional
copies by calling 800-222-8977 or by writing to Warburg Pincus Advisor Funds,
P.O. Box 9030, Boston, MA 02205-9030.
[LOGO]
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From time to time, the funds' investment adviser and co-administrators may waive
some fees and/or reimburse some expenses, without which performance would be
lower. Waivers and/or reimbursements are subject to change.
Returns are historical and include change in share price and reinvestment of
dividends and capital gains. Past performance cannot guarantee future results.
Returns and share price will fluctuate, and redemption value may be more or less
than original cost.
The views of the funds' management are as of the date of the letters and
portfolio holdings described in this document are as of April 30, 1999; these
views and portfolio holdings may have changed subsequent to these dates. Nothing
in this document is a recommendation to purchase or sell securities.
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WARBURG PINCUS INTERNATIONAL EQUITY FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999
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June 15, 1999
Dear Shareholder:
For the six months ended April 30, 1999, Warburg Pincus International Equity
Fund had a return of 9.84%, vs. a gain of 17.47% for the Morgan Stanley All
Country World Excluding the U.S. Index.* The fund's one-year return through
April 30, 1999 was -8.41%. Its five-year and since-inception (on April 5,
1991)** average annual total returns through April 30, 1999 were 4.16% and
7.79%, respectively. Note: Effective December 24, 1998, Harold E. Sharon serves
as a Co-Portfolio Manager of the Fund. Richard H. King (formerly Portfolio
Manager), P. Nicholas Edwards, Harold W. Ehrlich and Vincent J. McBride
(formerly Associate Portfolio Managers) also serve as Co-Portfolio Managers.
MANAGER COMMENTARY
The period was almost uniformly positive for foreign stock markets,
reflecting a worldwide easing of monetary policy in the wake of last summer's
global financial-market turmoil. Emerging stock markets were particularly
impressive, reflecting investor optimism that financial crises in Latin America
and Asia were ebbing. Also showing strength was the Japanese stock market, aided
by favorable investor reaction to a wave of corporate-restructuring news. Most
European markets, meanwhile, had solid performance, buoyed by the launch of
European Monetary Union (EMU) on January 1 and by a continued supportive
interest-rate and inflation backdrop.
Against this backdrop, the fund had a good return in absolute terms, though
it lagged its benchmark for the six months. Positive contributors to the fund's
performance included its increased weighting in Japan, which proved timely,
given that market's significant advance. Weighing on the fund was the surprising
weakness in European currencies, particularly the euro, which declined nearly
10% vs. the U.S. dollar during the period. European stocks represented the
majority of the fund's assets through the six months, and the
currency-translation loss (the fund's exposure was unhedged) reduced the
local-currency share-price gains generated by the portfolio.
We made a few noteworthy changes to the fund during the period in terms of
its regional exposure. Most notably, we lowered our weighting in Europe, from
roughly 70% of the fund at the start of the period to about a 55% weighting on
April 30. This reflected both stock-specific decisions and top-down
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WARBURG PINCUS INTERNATIONAL EQUITY FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999 (cont'd)
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considerations (e.g., because we believe that while European interest rates have
room to fall further, the region's rate environment will provide far less of a
tailwind for stocks going forward). That said, we still see much to like about
Europe, given the launch of EMU and the prospects for continued restructuring
and merger & acquisition activity.
Regional allocations we raised included, as noted, Japan. While the country's
economy has remained in the doldrums, there are certainly grounds for optimism,
given some recent pro-growth government policies and corporate Japan's apparent
commitment to restructurings. Our specific focus here through the period was on
technology, consumer-finance, telecommunications and banking companies.
Elsewhere, we modestly raised our exposure to emerging markets late in the
period, encouraged by an easing of fears regarding Brazil and by central banks'
efforts to keep global growth in positive territory. In this context, we added
several Asian stocks (mostly from South Korea), including financial companies
focused on local markets as well as more globally oriented technology names. We
had no exposure to Latin America at the end of the period, however, since we
viewed valuations there as relatively expensive from a risk-vs.-reward
perspective. That said, we continue to closely monitor the region for buying
opportunities.
Richard H. King Harold W. Ehrlich
Co-Portfolio Manager Co-Portfolio Manager
P. Nicholas Edwards Vincent J. McBride
Co-Portfolio Manager Co-Portfolio Manager
Harold E. Sharon
Co-Portfolio Manager
International investing entails special risk considerations, including
currency fluctuations, economic and political risks, lower liquidity, and
differences in accounting methods.
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* The Morgan Stanley All Country World Excluding the U.S. Index is a
market-capitalization weighted index of companies listed on stock exchanges
outside of the United States.
** Performance shown for the Advisor Class also includes the performance of the
fund's Common Class since inception (on May 2, 1989) until the fund's
Advisor Class was first offered on April 5, 1991. Because the Common Class
had lower distribution fees, the expenses of the Common Class are lower than
those of the Advisor Class. (Additionally, the fund's Common Class
performance was favorably affected by expense waivers and/or reimbursements.)
The performance shown has not been restated to reflect the lower expenses of
the Common Class (or to adjust for the Common Class expense waivers and/or
reimbursements). If it had, performance shown would have been lower.
2
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WARBURG PINCUS EMERGING MARKETS FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999
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June 15, 1999
Dear Shareholder:
For the six months ended April 30, 1999, Warburg Pincus Emerging Markets Fund
had a gain of 18.01%, vs. a gain of 34.87% for the Morgan Stanley Capital
International Emerging Markets Free Index.* The fund's one-year return through
April 30, 1999 was -26.00%. Its since-inception (on December 30, 1994) average
annual total return through April 30, 1999 was -4.75%.
The period was a strong one for emerging markets, with the vast majority
posting double-digit gains in U.S. dollar terms. Driving the markets were a
general improvement in economic conditions, evident most visibly in the
Asian-Pacific region, and an easing of the broad concerns that had been
triggered by Russia's debt default and currency devaluation last August.
Set against this backdrop, the fund had a strong showing in absolute terms
for the period, but trailed its benchmark by a fairly wide margin. Much of that
underperformance can be attributed to the fund's Latin American exposure. The
fund entered the period with a fairly significant underweighting in the region.
We trimmed that stake substantially further following Brazil's devaluation of
its currency in mid-January, however, concerned about the devaluation's effects
on regional economic growth and, on a company level, earnings prospects. While
that decision was sound on fundamental grounds, it proved costly in terms of the
fund's relative performance, as the region's stock markets subsequently staged a
strong recovery in February and, especially, March, with investors discounting
most if not all of the bad news and instead focusing on the prospects for a
recovery. Though we did raise our exposure to the region late in the period on
some better-than-expected economic data, especially concerning Brazil, the move
proved too little, too late in terms of the fund's relative performance.
We made several other noteworthy adjustments to the fund's regional and
country allocations over the course of the period. The most significant of these
was an increase in its Asian-Pacific exposure, reflecting our growing level of
comfort with the region from a risk-reward perspective and our ability to find
attractively valued stocks, particularly in specific markets such as South Korea
and Taiwan. We also raised the fund's weighting in South Africa, for similar
reasons. Markets to which we trimmed the fund's exposure included Israel and
Poland, largely on profit-taking.
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WARBURG PINCUS EMERGING MARKETS FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999 (cont'd)
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Looking ahead, we see grounds for optimism regarding emerging markets.
Investor sentiment toward the asset class appears to have taken a decided turn
for the better, and with many investors still underweighted in the markets, the
potential for a substantial inflow of liquidity into stocks would appear to be
sizable. Simultaneously, valuations in most emerging markets remain very
attractive relative to those in developed markets, providing additional
incentive for those investors who might be inclined to buy. Added to the mix is
generally encouraging news on the economic and earnings fronts. The
Asian-Pacific region appears to have begun to turn the corner economically,
after nearly two years of weakness. Many of the region's companies have also
begun to take steps to restructure and improve efficiencies, auguring well for a
longer-term, sustainable recovery. Latin America also shows signs that its
problems may prove less severe than many, including ourselves, had originally
feared. Prospects for other emerging markets vary, but in general appear to be
improving relative to where they stood several months ago. We believe that the
combination of better sentiment, attractive valuations and improving
fundamentals argues strongly for emerging markets, and we remain positive in our
outlook.
That said, we would encourage investors to continue to approach the asset
class with realistic expectations. While emerging markets have, we believe, very
attractive long-term growth prospects, they will also undoubtedly continue to
display very high short-term volatility, and investors should be comfortable
with that fact before committing assets. For investors with a sufficiently high
tolerance for risk, though, and a long-term investment horizon, we believe these
markets may be worthy of consideration.
Richard H. King Vincent J. McBride
Co-Portfolio Manager Co-Portfolio Manager
International investing entails special risk considerations, including
currency fluctuations, economic and political risks, lower liquidity, and
differences in accounting methods; these risks are generally heightened for
emerging-market investments.
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* The Morgan Stanley Capital International Emerging Markets Free Index is a
market-capitalization-weighted index of emerging-market countries determined
by Morgan Stanley. The index includes only those countries open to non-local
investors.
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WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999
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June 15, 1999
Dear Shareholder:
For the six months ended April 30, 1999, Warburg Pincus Global Post-Venture
Capital Fund had a return of 48.25%, vs. gains of 17.80% for the Lipper Global
Funds Index,* 18.88% for the Morgan Stanley World Index** and 25.74% for the
Russell 2000 Growth Index.*** The fund's one-year return through April 30, 1999
was 20.40%. Its since-inception (on September 30, 1996) average annual total
return through April 30, 1999 was 20.21%. Note: Effective March 31, 1999, J.H.
Cullum Clark joins Elizabeth B. Dater and Harold E. Sharon as Co-Portfolio
Manager of the fund.
MANAGER COMMENTARY
The period was a positive one for global stock markets, reflecting a
worldwide easing of monetary policy and increased optimism regarding global
economic growth. Almost all major global indexes advanced, many impressively,
with most of the best performances belonging to previously battered emerging
markets.
Against this backdrop, the fund had a solid gain, both in absolute terms and
compared to relevant benchmarks. Driving the fund's performance were good
showings from a number of its holdings, in particular its technology,
communications, media and consumer-related stocks.
We made few material changes to the fund during the period in terms of
overall strategies, remaining focused on underfollowed companies that stand to
benefit from the strong deregulation trend sweeping global economies. We did,
however, continue to increase the fund's exposure to foreign companies (which
accounted for roughly 60% of the fund's assets as of the end of the period).
This reflected venture capital's continued expansion overseas, as well as a
more-hospitable backdrop for foreign stocks during the period. We added a number
of European names, as well as some Asia/Pacific stocks (e.g., from Singapore and
Japan).
5
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WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
SEMIANNUAL INVESTMENT ADVISER'S REPORT -- APRIL 30, 1999 (cont'd)
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Looking ahead, we are excited about venture capital's broadening global
presence, and expect to see an ever-lengthening list of investment opportunities
from which to choose (and not only within the high-technology areas
traditionally favored by venture capitalists, who are targeting a range of other
industries as well). As ever, our efforts will be devoted to identifying those
stocks we believe have the brightest long-term prospects.
Elizabeth B. Dater Harold E. Sharon J.H. Cullum Clark
Co-Portfolio Manager Co-Portfolio Manager Co-Portfolio Manager
International investing entails special risk considerations, including
currency fluctuations, economic and political risks, lower liquidity, and
differences in accounting methods. There are also special risk considerations
associated with post-venture-capital investments. These are detailed in the
fund's Prospectus, which should be read carefully before investing.
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* The Lipper Global Funds Index is an equal-weighted performance index,
adjusted for capital-gains distributions and income dividends, of the
largest qualifying funds within this investment objective, and is compiled
by Lipper Inc.
** The Morgan Stanley World Index is a market-weighted average of the
performance of securities listed on the stock exchanges of all developed
countries.
*** The Russell 2000 Growth Index is an unmanaged index (with no defined
investment objective) of those securities in the Russell 2000 Index with a
greater-than-average growth orientation. It includes reinvestment of
dividends, and is compiled by Frank Russell Company.
6
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WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS--APRIL 30, 1999 (UNAUDITED)
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Number of
Shares Value
----------- --------------
Common Stocks (95.4%)
Canada (3.3%)
Rogers Communications,
Inc. Class B+ 1,840,000 $ 34,492,656
The Toronto - Dominion Bank 69,000 3,688,535
--------------
38,181,191
--------------
Denmark (1.8%)
Tele Danmark AS Class B 201,200 20,783,258
--------------
France (9.0%)
Elf Aquitaine SA 93,600 14,556,611
PSA Peugeot Citroen 80,700 13,404,181
Rhone Poulenc, Ltd. Class A 318,363 15,156,614
Societe Generale d'Entreprises SA 577,300 24,430,291
Societe Generale Paris 100,400 17,993,441
Suez Lyonnaise des Eaux SA 54,800 9,334,123
Usinor SA 589,800 9,135,092
--------------
104,010,353
--------------
Germany (5.5%)
BHF Bank AG 268,450 10,181,685
Fresenius Medical Care AG 213,000 11,537,631
Hannover Rueckversicherungs AG 101,600 8,448,573
Mannesmann AG 102,560 13,443,626
Siemens AG 274,500 20,241,478
--------------
63,852,993
--------------
Greece (1.0%)
Hellenic Telecommunication
Organization SA ADR+ 1,010,000 12,056,875
--------------
Hong Kong (1.2%)
SmarTone
Telecommunications
Holdings, Ltd. 4,036,000 13,982,426
--------------
India (0.7%)
Bharat Petroleum Corp., Ltd. 200 730
Hindalco Industries, Ltd. 203 2,705
Mahanagar Telephone
Nigam, Ltd. 2,137,800 7,755,880
Reliance Industries, Ltd. 16,314 49,195
State Bank of India, Ltd. 7,899 28,657
--------------
7,837,167
--------------
Ireland (1.4%)
Bank of Ireland 809,600 16,231,057
--------------
Number of
Shares Value
----------- --------------
COMMON STOCKS (cont'd)
Israel (2.3%)
ECI Telecommunications
Limited Designs 310,500 $ 11,449,688
Orbotech, Ltd.+ 307,700 14,769,600
--------------
26,219,288
--------------
Italy (12.5%)
Banca Nazionale del Lavoro
SpA+ 6,000,000 20,503,163
Olivetti Group SpA+ 6,027,000 21,041,768
Seat Pagine Gialle SpA 37,183,000 30,644,249
Telecom Italia SpA 5,672,800 60,435,767
Unione Immobiliare SpA+ 22,611,000 12,965,407
--------------
145,590,354
--------------
Japan (26.3%)
Advantest Corp. 173,900 13,301,685
Hoya Corp. 215,000 11,257,833
Matsushita Electric
Industrial Group 336,000 24,124,394
Mitsui & Co., Ltd. 2,600,000 19,059,773
Nichiei Co., Ltd. 150,100 13,015,395
Nomura Securities Co., Ltd. 1,172,000 12,646,775
NTT Mobile Communications
Network, Inc.+ 589 34,542,173
Orix Corp. 349,400 28,130,834
Rohm Co., Ltd. 200,000 24,128,415
Sanwa Bank 951,000 10,676,321
Shohkoh Fund & Co., Ltd. 75,060 44,019,278
Softbank Corp. 65,300 8,693,074
Sony Corp. 123,500 11,536,608
Sumitomo Bank, Ltd. 919,000 12,442,086
Sumitomo Rubber
Industries, Ltd. 1,046,000 6,879,196
Tokyo Electron, Ltd. 130,000 7,406,083
Toshiba Corp. 3,478,000 23,310,730
--------------
305,170,653
--------------
Mexico (0.2%)
Gruma SA de CV Class B 967,442 1,855,363
--------------
Netherlands (2.7%)
Koninklijke Hoogovens NV 240,084 9,639,225
Vedior NV 144A 291,900 6,577,802
Vendex Non-Foods NV 601,811 14,994,022
--------------
31,211,049
--------------
See Accompanying Notes to Financial Statements.
7
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WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (cont'd)--APRIL 30, 1999 (UNAUDITED)
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Number of
Shares Value
----------- --------------
COMMON STOCKS (cont'd)
Portugal (2.3%)
Banco Pinto & Sotto Mayor SA 339,000 $ 6,330,114
Portugal Telecom SA 495,200 20,667,823
--------------
26,997,937
--------------
Singapore (1.2%)
DBS Land, Ltd. 3,508,000 6,504,352
Natsteel Electronics, Ltd. 1,020,000 3,433,127
Venture Manufacturing, Ltd. 771,000 4,234,012
--------------
14,171,491
--------------
South Africa (0.8%)
Sappi, Ltd.+ 1,311,600 9,453,995
--------------
South Korea (3.2%)
Daewoo Securities Co.+ 344,300 8,502,749
Hyundai Industrial
Development &
Construction 201,700 2,664,525
Korea Electric Power Corp. 218,000 6,273,311
Samsung Corp.+ 310,000 4,356,045
Samsung Electronics Co. 206,300 15,865,716
--------------
37,662,346
--------------
Spain (1.2%)
Banco Santander Central
Hispano SA 271,800 5,912,071
Endesa SA 384,700 8,563,179
--------------
14,475,250
--------------
Sweden (1.9%)
Biora AB ADR+ 92,650 1,163,916
Electrolux AB Series B 601,535 12,229,839
Kinnevik AB Class B 296,300 6,517,291
Kungsleden AB+ 216,000 1,643,605
--------------
21,554,651
--------------
Switzerland (2.4%)
Roche Holding AG 1,141 13,445,131
United Bank of Switzerland SA 42,300 14,392,197
--------------
27,837,328
--------------
Number of
Shares Value
----------- --------------
COMMON STOCKS (cont'd)
Taiwan (1.8%)
Taiwan Semiconductor
Manufacturing Co.+ 6,295,000 $ 21,272,732
--------------
Turkey (0.8%)
Eregli Demir ve Celik
Fabrikalari TAS 96,590,000 1,776,060
Haci Omer Sabanci
Holding AS 125,000,000 3,431,717
Yapi ve Kredi Bankasi AS 150,000,000 3,600,908
--------------
8,808,685
--------------
United Kingdom (11.9%)
Barclays PLC 459,900 14,617,174
British Aerospace PLC 1,884,100 14,106,191
British Airport Authority PLC 1,016,864 10,642,143
British Energy PLC 2,552,900 21,723,592
British Steel PLC 4,168,000 9,915,350
Orange PLC 1,229,967 16,753,929
Reed International PLC 1,444,500 13,152,339
Royal & Sun Alliance Insurance
Group PLC 533,072 4,600,484
Williams PLC 3,012,992 20,714,703
Astra Zeneca Group PLC 299,400 11,728,616
--------------
137,954,521
--------------
TOTAL COMMON STOCK
(Cost $921,036,491) 1,107,170,963
--------------
PREFERRED STOCK (0.2%)
Thailand (0.2%)
Siam Commercial Bank
Public Co., Ltd.+
(Cost $1,790,142) 2,545,000 1,782,890
--------------
WARRANTS (0.0%)
Thailand (0.0%)
Siam Commercial Bank
Public Co., Ltd.
05/10/02+ (Cost $0) 2,545,000 0
--------------
See Accompanying Notes to Financial Statements.
8
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WARBURG PINCUS INTERNATIONAL EQUITY FUND
STATEMENT OF NET ASSETS (CONT'D)--APRIL 30, 1999 (UNAUDITED)
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Par
(000) Value
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SHORT TERM INVESTMENT (2.7%)
Repurchase agreement with
State Street Bank & Trust Co.
dated 04/30/99 at 4.82% to be
repurchased at $31,911,813 on
05/03/99. (Collateralized by a
pro rata amount of U.S. Treasury
Notes ranging in par values from
$26,210,000 to $50,000,000,
6.00% to 8.50%, 07/31/02 -
02/15/20. Pro rata market value
of collateral is $32,539,417)
(Cost $31,899,000) $31,899 31,899,000
--------------
TOTAL INVESTMENTS AT VALUE
(98.3%) (Cost $954,725,633*) 1,140,852,853
OTHER ASSETS IN EXCESS
OF LIABILITIES (1.7%) 19,291,130
--------------
NET ASSETS (100.0%) (applicable
to 49,923,337 Common Class shares
and 13,566,694 Advisor Class shares) $1,160,143,983
==============
NET ASSET VALUE, offering and
redemption price per Common Class
share ($914,722,321 divided by 49,923,337) $ 18.32
==============
NET ASSET VALUE, offering and
redemption price per Advisor Class
share ($245,421,662 divided by 13,566,694) $ 18.09
==============
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
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+ Non-income producing security.
* Cost for federal income tax purposes is $953,213,790.
See Accompanying Notes to Financial Statements.
9
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WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS --APRIL 30, 1999 (UNAUDITED)
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Number of
Shares Value
----------- -----------
Common Stocks (86.7%)
Argentina (3.6%)
Banco de Galicia y Buenos
Aires SA de CV ADR 53,200 $ 1,226,925
Telefonica de Argentina SA ADR 31,500 1,177,313
----------
2,404,238
----------
Australia (2.6%)
Novus Petroleum, Ltd. 636,521 729,819
Oil Search, Ltd. 767,400 1,001,946
----------
1,731,765
----------
Brazil (3.6%)
Companhia Paranaense de
Energia ADR 132,100 1,081,569
Embartel Participacoes SA ADR 82,400 1,339,000
----------
2,420,569
----------
Chile (1.2%)
Distribucion Y Servicio D & S
SA ADR 52,800 798,600
----------
China (0.6%)
China Telecom, Ltd.+ 166,000 379,113
----------
Croatia (2.6%)
Pliva DD GDR 112,300 1,742,121
----------
Egypt (0.0%)
Commercial International
Bank, Ltd. 26 257
----------
Greece (3.0%)
Hellenic Telecommunication
Organization SA ADR+ 165,800 1,979,238
----------
Hong Kong (4.2%)
Cosco Pacific, Ltd. 492,000 333,282
New World Development Co., Ltd. 700 1,734
Shaw Brothers, Ltd. 779,000 532,722
Smartone Telecommunications
Holdings, Ltd. 287,840 997,201
Wing Hang Bank, Ltd. 301,100 920,759
----------
2,785,698
----------
Hungary (2.3%)
BorsodChem Rt. 7,200 168,586
Mol Magyar Olaj-es Gazipari 15,000 334,421
OTP Bank Rt. 23,850 1,007,011
----------
1,510,018
----------
India (7.3%)
Aptech, Ltd. 62,500 1,215,193
Grasim Industries, Ltd. 506 1,337
Number of
Shares Value
----------- -----------
Common Stocks (cont'd)
India (cont'd)
Mahanagar Telephone Nigam, Ltd. 368,500 $ 1,336,908
Pentafour Software & Exports, Ltd. 71,200 1,659,386
Reliance Industries, Ltd. 659 1,987
Satyam Computers 25,300 650,557
----------
4,865,368
----------
Israel (4.0%)
Blue Square Israel Co., Ltd. ADR 55,200 765,900
ECI Telecommunications, Ltd. 25,400 936,625
Orbotech, Ltd.+ 19,700 945,600
----------
2,648,125
----------
Mexico (7.4%)
Cintra SA+ 720,300 349,246
Fomento Economico Mexicano
SA de CV ADR+ 46,500 1,691,438
Grupo Industrial Saltillo SA de CV 406,300 1,495,085
Telefonos de Mexico SA ADR 18,600 1,408,950
----------
4,944,719
----------
Philippines (2.0%)
Philippine Long Distance
Telephone Co. 41,000 1,326,273
----------
Poland (2.0%)
Bank Slaski SA 7,583 343,472
Elektrim Spolka Akcyjna SA 84,736 1,007,774
----------
1,351,246
----------
Portugal (0.1%)
Portugal Telecom SA 2,100 87,646
----------
Singapore (2.3%)
Allgreen Properties, Ltd.+ 1,792,000 1,089,908
Keppel Tatlee Bank, Ltd. 178,000 340,549
Venture Manufacturing 17,000 93,357
----------
1,523,814
----------
South Africa (7.7%)
Amalgamated Banks of
South Africa, Ltd. 225,100 1,180,013
Billiton PLC 206,400 696,527
Sanlam, Ltd. 1,059,525 1,036,208
Sappi, Ltd.+ 106,800 769,813
South African Breweries, Ltd. 170,600 1,425,314
----------
5,107,875
----------
See Accompanying Notes to Financial Statements.
10
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WARBURG PINCUS EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS (cont'd)--APRIL 30, 1999 (UNAUDITED)
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Number of
Shares Value
----------- -----------
Common Stocks (cont'd)
South Korea (16.3%)
Cheil Jedang Corp. 14,000 $ 742,135
Daewoo Securities Co.+ 31,100 768,038
Hankuk Electric Glass Co., Ltd.+ 99,700 3,305,260
Hyundai Industrial Development
& Construction 28,600 377,816
Korea Telecom Corp.+ 18,800 884,268
Samsung Corp. 135,860 1,909,072
Samsung Display Devices Co. 7,100 364,420
Samsung Electronics Co. 20,311 1,562,039
Shinhan Bank 86,500 953,458
----------
10,866,506
----------
Taiwan (7.0%)
Far Eastern Textile, Ltd. 555,000 745,114
Phoenixtec Power Co., Ltd.+ 606,000 1,084,161
Taiwan Semiconductor
Manufacturing Co.+ 608,000 2,054,618
United Microelectronics Co., Ltd.+ 501,000 781,400
----------
4,665,293
----------
Thailand (2.5%)
Hana Microelectronics
Public Co., Ltd. 282,400 532,630
Siam Commercial Bank
Public Co., Ltd. 837,700 1,105,982
----------
1,638,612
----------
Turkey (4.4%)
Akbank TAS 35,535,200 1,134,388
Akcansa Cimento AS 28,752,300 734,286
Yapi ve Kredi Bankasi AS 45,266,558 1,086,671
----------
2,955,345
----------
TOTAL COMMON STOCK
(Cost $47,308,683) 57,732,439
----------
PREFERRED STOCK (10.4%)
Brazil (5.5%)
Petroleo Brasileiro SA 9,623,400 1,560,423
Tele Norte Leste
Participacoes SA 69,456,900 1,214,157
Telecomunicacoes de Sao
Paulo SA 7,531,200 939,715
----------
3,714,295
----------
Thailand (4.9%)
Siam Commercial Bank
Public Co., Ltd.+ 4,620,000 3,236,522
----------
TOTAL PREFERRED STOCK
(Cost $6,083,252) 6,950,817
----------
Number of
Shares Value
----------- -----------
RIGHTS & WARRANTS (0.0%)
Brazil (0.0%)
Telecomunicacoes de Sao
Paulo SA Pfd. Rts., 05/24/99+ 73,592 $ 0
----------
Thailand (0.0%)
Siam Commercial Bank
Public Co., Ltd. Wts,
05/10/02+ 4,620,000 0
----------
TOTAL RIGHTS & WARRANTS
(Cost $0) 0
----------
Par
(000)
--------
CORPORATE BONDS (1.2%)
Philippines (1.2%)
Piltel International Holding
Corp. (Convertible) (Putable
01/17/02 @ $138.73)
(Callable 01/18/02 @$100)
(Cost $1,276,366) $1,864 787,540
----------
SHORT TERM INVESTMENT (1.7%)
Repurchase agreement with
State Street Bank & Trust Co.
dated 04/30/99 at 4.82%
to be repurchased at $1,116,448
on 05/03/99. (Collateralized
by a pro rata amount of U.S.
Treasury Notes ranging in par
values from $26,210,000 to
$50,000,000, 6.00% to 8.50%,
07/31/02 - 02/15/20. Pro rata
market value of collateral is
$1,138,432) (Cost $1,116,000) 1,116 1,116,000
----------
TOTAL INVESTMENTS AT VALUE
(100.0%) (Cost $55,784,301*) $66,586,796
===========
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
GDR = Global Depository Receipt
- --------------------------------------------------------------------------------
+ Non-income producing security.
* Cost for federal income tax purposes is $55,510,798.
See Accompanying Notes to Financial Statements.
11
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS--APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
Number of
Shares Value
----------- -----------
Common Stock (34.2%)
Aerospace & Defense (0.6%)
Orbital Sciences Corp.+ 1,500 $ 31,594
----------
Business Services (4.3%)
CSG Systems International, Inc.+ 1,600 61,800
Lason Holdings, Inc.+ 700 27,694
On Assignment, Inc.+ 1,100 33,344
QRS Corp.+ 900 49,500
SunGard Data Systems, Inc.+ 1,000 31,937
----------
204,275
----------
Communications & Media (5.5%)
America Online, Inc.+ 650 92,787
Infoseek Corp.+ 600 30,637
Outdoor Systems, Inc.+ 2,063 51,949
Yahoo!, Inc.+ 550 96,078
----------
271,451
----------
Computers (4.9%)
Citrix Systems, Inc. + 1,000 42,500
Concord Communications, Inc. 1,100 49,225
Network Appliance, Inc.+ 1,400 70,437
Transaction Systems Architects,
Inc. Class A+ 1,000 32,437
Verisign, Inc+ 400 46,000
----------
240,599
----------
Electronics (4.3%)
Maxim Integrated Products, Inc.+ 900 50,400
Uniphase Corp.+ 700 84,962
Vitesse Semiconductor Corp.+ 1,600 74,100
----------
209,462
----------
Financial Services (0.9%)
E*Trade Group, Inc.+ 400 46,200
----------
Food, Beverages & Tobacco (0.8%)
Ben & Jerry's Homemade, Inc.
Class A+ 1,400 40,687
----------
Healthcare (0.4%)
Alternative Living Services, Inc.+ 900 20,025
----------
Leisure & Entertainment (1.7%)
Coach USA, Inc.+ 800 19,000
Premier Parks, Inc.+ 1,800 62,213
----------
81,213
----------
Pharmaceuticals (2.1%)
Geltex Pharmaceuticals, Inc.+ 1,700 29,113
SangStat Medical Corp.+ 1,400 20,300
Serologicals Corp.+ 1,650 12,375
Watson Pharmaceuticals, Inc.+ 1,000 40,500
----------
102,288
----------
Number of
Shares Value
----------- -----------
Common Stock (cont'd)
Retail (3.1%)
Amazon.com, Inc.+ 400 $ 68,825
Staples, Inc.+ 2,800 84,000
----------
152,825
----------
Telecommunications & Equipment (5.6%)
Amdocs, Ltd.+ 1,560 41,925
Cisco Systems, Inc.+ 775 88,398
MCI Worldcom, Inc.+ 600 49,313
Pinnacle Holdings, Inc.+ 2,100 43,050
TTI Team Telecom International,
Ltd.+ 6,900 51,750
----------
274,436
----------
Total Common Stock
(Cost $1,138,901) 1,675,055
----------
Foreign Common Stock (64.7%)
Australia (1.7%)
Cue Energy Resources NL+ 876,000 26,707
Oil Search, Ltd. 44,600 58,231
----------
84,938
----------
Bermuda (0.6%)
Central European Media
Enterprises, Ltd. Class A+ 3,300 27,019
----------
Canada (10.4%)
Envoy Communications Group,
Inc.+ 33,200 180,099
Research IN Motion, Ltd.+ 5,900 71,506
Rogers Communications,
Inc. Class B+ 4,900 91,855
Shaw Communications, Inc.
Class B+ 3,400 137,700
Versus Technologies, Inc.+ 2,300 28,428
----------
509,588
----------
Germany (5.4%)
Marbert AG 3,300 78,553
Medion AG+ 470 95,470
Telegate AG+ 2,000 90,561
----------
264,584
----------
Greece (1.3%)
Antenna TV SA ADR 5,300 62,275
----------
Hong Kong (1.1%)
Shaw Brothers, Ltd. 77,000 52,657
----------
Israel (1.5%)
Gilat Satellite Networks+ 1,400 72,800
----------
See Accompanying Notes to Financial Statements.
12
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
STATEMENT OF NET ASSETS (cont'd)--APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
Number of
Shares Value
----------- -----------
FOREIGN COMMON STOCK (cont'd)
Italy (5.0%)
Buffetti SpA+ 20,000 $ 91,407
Locazione Attrezzature SpA 54,000 46,275
SEAT Pagine Gialle SpA 20,000 24,968
SEAT Pagine Gialle SpA+ 42,600 35,109
Unione Immobiliare SpA+ 83,400 47,823
----------
245,582
----------
Japan (2.4%)
Kadokawa Shoten Publishing
Co., Ltd. 500 76,239
Shohkoh Fund & Co., Ltd. 70 41,052
----------
117,291
----------
Netherlands (1.7%)
Ordina NV 3,360 80,692
----------
Portugal (3.0%)
Semapa-Sociedade de
Investimento e Gestao, SGPS, SA 5,000 80,405
SIVA-SGPS, SA 4,800 66,626
----------
147,031
----------
Singapore (5.0%)
Datapulse Technology, Ltd. 405,000 157,839
Venture Manufacturing, Ltd. 16,000 87,865
----------
245,704
----------
Spain (7.6%)
Dinamia Capital Privado. Sociedad
de Capital Riesgo SA+ 8,000 88,614
Funespana SA+ 3,900 70,555
Prima Inmobiliaria SA+ 17,800 138,224
Transportes Azkar SA+ 5,500 71,280
----------
368,673
----------
Sweden (2.5%)
Avesta Sheffield AB 10,500 45,192
Biora AB ADR+ 3,000 37,688
Kungsleden AB+ 5,000 38,046
----------
120,926
----------
Switzerland (3.7%)
Gretag Imaging Group+ 425 40,617
SAIA-Burgess Electronics AG+ 130 33,814
Sez Holding AG Class A 200 53,204
TAG Heuer International SA 520 52,172
----------
179,807
----------
Number of
Shares Value
----------- -----------
FOREIGN COMMON STOCK (cont'd)
United Kingdom (11.8%)
3i Group PLC 5,583 $ 60,542
AMVESCAP PLC ADR 440 24,008
Electronics Boutique PLC 59,000 97,846
EMAP PLC 3,720 79,002
Filtronic PLC 3,400 47,244
Holmes Place PLC 15,633 82,686
London Bridge Software
Holdings PLC 500 13,545
Perpetual PLC 800 47,079
Saatchi & Saatchi PLC ADR 2,600 50,050
Schroders PLC 2,100 49,501
Sema Group PLC 2,500 24,192
----------
575,695
----------
TOTAL FOREIGN COMMON STOCK
(Cost $2,710,113) 3,155,262
----------
SHORT TERM INVESTMENTS (4.9%)
Institutional Money Market Trust 6,883 6,883
RBB Money Market Fund 232,708 232,708
----------
TOTAL SHORT TERM INVESTMENTS
(Cost $239,591) 239,591
----------
TOTAL INVESTMENTS AT VALUE
(103.8%) (Cost $4,088,605*) 5,069,908
LIABILITIES IN EXCESS OF OTHER
ASSETS (-3.8%) (187,783)
----------
NET ASSETS (100.0%) (applicable to
313,748 Common Class shares and
112 Advisor Class shares) $4,882,125
==========
NET ASSET VALUE, offering and
redemption price per Common Class share
($4,880,390 divided by 313,748) $ 15.56
==========
NET ASSET VALUE, offering and
redemption price per Advisor Class share
($1,735 divided by 112) $ 15.46
==========
INVESTMENT ABBREVIATIONS
ADR = American Depository Receipt
- --------------------------------------------------------------------------------
+ Non-income producing security.
* Cost for federal income tax purposes is $4,088,605.
See Accompanying Notes to Financial Statements.
13
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets
<S> <C>
Investments at value (Cost $55,784,301) $66,586,796
Receivable for investment sold (Cost $5,773,951) 5,770,950
Foreign currency (Cost $1,243,056) 1,244,770
Cash 876,698
Singapore Swap Basket (Cost $626,075) 779,597
Receivable for fund shares sold 644,948
Dividends and interest receivable (Cost $379,495) 338,229
Prepaid offering costs 31,080
Other assets 319
-----------
Total Assets 76,273,387
-----------
Liabilities
Payable for investments purchased (Cost $6,945,492) 6,968,632
Accrued expenses payable 196,125
-----------
Total Liabilities 7,164,757
-----------
Net Assets, applicable to 8,863,850 Common Class shares and 2,076 Advisor Class shares outstanding $69,108,630
===========
Net Asset Value, offering and redemption price per Common Class share
($69,092,854 divide by 8,863,850) $ 7.79
===========
Net Asset Value, offering and redemption price per Advisor Class share ($15,776 divide by 2,076) $ 7.60
===========
</TABLE>
See Accompanying Notes to Financial Statements.
14
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF OPERATIONS
For the Six Months Ended April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Emerging Global Post-Venture
Equity Fund Markets Fund Capital Fund
------------- ------------- -------------
<S> <C> <C> <C>
Investment Income:
Dividends $ 16,282,105 $ 748,999 $ 24,665
Interest 653,889 242,103 2,849
Foriegn taxes withheld (1,280,420) (80,841) (1,920)
------------- ------------- -------------
Total investment income 15,655,574 910,261 25,594
------------- ------------- -------------
Expenses:
Investment advisory 6,895,113 362,889 26,314
Administrative services 1,232,622 69,379 6,491
Audit 36,458 6,083 4,697
Custodian/Sub-custodian 613,230 72,830 11,424
Directors 6,284 4,627 4,870
Insurance 17,361 664 183
Interest 222,137 1,740 0
Legal 65,452 9,185 12,743
Offering/Organizational costs 0 23,307 588
Printing 118,517 10,708 3,134
Registration 39,340 28,912 16,508
Shareholder servicing/distribution 701,338 72,598 5,262
Transfer agent 618,789 55,620 2,555
Miscellaneous 22,730 234 823
------------- ------------- -------------
10,589,371 718,776 95,592
Less: fees waived, expenses reimbursed and
transfer agent offsets (28,357) (239,742) (60,859)
------------- ------------- -------------
Total expenses 10,561,014 479,034 34,733
------------- ------------- -------------
Net investment income (loss) 5,094,560 431,227 (9,139)
------------- ------------- -------------
Net Realized and Unrealized Gain from Investments
and Foreign Currency Related Items:
Net realized gain (loss) from security and
other related transactions 28,298,679 (10,244,897) 956,758
Net realized loss from foreign currency
related items (28,697,504) (605,774) (13,626)
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency related items 138,090,845 20,337,453 727,150
------------- ------------- -------------
Net realized and unrealized gain from
investments and foriegn currency
related items 137,692,020 9,486,782 1,670,282
------------- ------------- -------------
Net increase in net assets resulting from
operations $ 142,786,580 $ 9,918,009 $ 1,661,143
============= ============= =============
</TABLE>
See Accompanying Notes to Financial Statements.
15
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Equity Fund
-------------------------------------
For the
Six Months
Ended For the
April 30, 1999 Year Ended
(Unaudited) October 31, 1998
--------------- ----------------
<S> <C> <C>
From Operations:
Net investment income $ 5,094,560 $ 12,302,990
Net realized gain (loss) from security and other
related transactions 28,298,679 (213,451,199)
Net realized gain (loss) from foreign currency related items (28,697,504) 51,944,476
Net change in unrealized appreciation (depreciation) from
investments and foreign currency related items 138,090,845 47,688,281
--------------- ---------------
Net increase (decrease) in net assets resulting from
operations 142,786,580 (101,515,452)
--------------- ---------------
From Distributions:
Dividends from net investment income
Common Class 0 (13,983,166)
Advisor Class 0 (776,129)
Distributions from realized gains
Common Class 0 (276,226,122)
Advisor Class 0 (61,851,043)
--------------- ---------------
Net decrease in net assets from distributions 0 (352,836,460)
--------------- ---------------
From Capital Share Transactions:
Proceeds from sale of shares 581,469,156 945,589,502
Reinvested dividends 0 335,103,766
Net asset value of shares redeemed (1,148,051,195) (2,054,917,142)
--------------- ---------------
Net increase (decrease) in net assets from capital
share transactions (566,582,039) (774,223,874)
--------------- ---------------
Net increase (decrease) in net assets (423,795,459) (1,228,575,786)
Net Assets:
Beginning of period 1,583,939,442 2,812,515,228
--------------- ---------------
End of period $ 1,160,143,983 $ 1,583,939,442
=============== ===============
Undistributed Net Investment Income: $ 2,533,392 $ 0
=============== ===============
</TABLE>
See Accompanying Notes to Financial Statements.
16
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Emerging Markets Fund Global Post-Venture Capital Fund
-------------------------------- --------------------------------
For the For the
Six Months Six Months
Ended For the Ended For the
April 30, 1999 Year Ended April 30, 1999 Year Ended
(Unaudited) October 31, 1998 (Unaudited) October 31, 1998
-------------- ---------------- -------------- ----------------
<S> <C> <C> <C> <C>
From Operations:
Net investment income (loss) $ 431,227 $ 990,189 $ (9,139) $ (35,282)
Net realized gain (loss) from security and
other related transactions (10,244,897) (62,658,535) 956,758 16,393
Net realized loss from foreign
currency related items (605,774) (420,100) (13,626) (1,517)
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency related items 20,337,453 21,064,753 727,150 (224,948)
------------- ------------- ------------- -------------
Net increase (decrease) in net assets
resulting from operations 9,918,009 (41,023,693) 1,661,143 (245,354)
------------- ------------- ------------- -------------
From Distributions:
Dividends in excess of net investment income
Common Class 0 (427,377) 0 (80,461)
Advisor Class 0 (880) 0 (30)
Distributions from realized gains
Common Class 0 (5,226,322) (11,435) (29,917)
Advisor Class 0 (10,768) (4) (12)
------------- ------------- ------------- -------------
Net decrease in net assets from
distributions 0 (5,665,347) (11,439) (110,420)
------------- ------------- ------------- -------------
From Capital Share Transactions:
Proceeds from sale of shares 59,713,098 120,358,207 450,809 1,626,747
Reinvested dividends 0 5,383,994 11,073 108,155
Net asset value of shares redeemed (60,737,021) (174,910,995) (891,758) (915,348)
------------- ------------- ------------- -------------
Net increase (decrease) in net assets
from capital share transactions (1,023,923) (49,168,794) (429,876) 819,554
------------- ------------- ------------- -------------
Net increase (decrease) in net assets 8,894,086 (95,857,834) 1,219,828 463,780
Net Assets:
Beginning of period 60,214,544 156,072,378 3,662,297 3,198,517
------------- ------------- ------------- -------------
End of period $ 69,108,630 $ 60,214,544 $ 4,882,125 $ 3,662,297
============= ============= ============= =============
Undistributed net investment income: $ 0 $ 0 $ 0 $ 0
============= ============= ============= =============
</TABLE>
See Accompanying Notes to Financial Statements.
17
<PAGE>
WARBURG PINCUS INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a Advisor Class Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ----------------------------------------------------------------
(Unaudited) 1998 1997 1996 1995 1994
-------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value,
beginning of period $ 16.47 $ 20.54 $ 20.50 $ 19.16 $ 20.38 $ 16.91
-------- -------- -------- -------- -------- --------
Investment activities:
Net investment income (loss) (0.41) 0.04(a) 0.04 0.18 0.03 0.16
Net gains or losses on
investments and foreign
currency related items
(both realized and
unrealized) 2.03 (1.36) 0.78 1.68 (0.67) 3.35
-------- -------- -------- -------- -------- --------
Total from investment
activities 1.62 (1.32) 0.82 1.86 (0.64) 3.51
-------- -------- -------- -------- -------- --------
Distributions:
From net investment income 0.00 (0.03) (0.04) (0.52) (0.05) 0.00
From realized capital gains 0.00 (2.72) (0.74) 0.00 (0.53) (0.04)
-------- -------- -------- -------- -------- --------
Total distributions 0.00 (2.75) (0.78) (0.52) (0.58) (0.04)
-------- -------- -------- -------- -------- --------
Net asset value, end of period $ 18.09 $ 16.47 $ 20.54 $ 20.50 $ 19.16 $ 20.38
======== ======== ======== ======== ======== ========
Total return 9.84%+ (6.49)% 4.04% 9.89% (3.04) 20.77%
Ratios and supplemental data
Net assets, end of period
(000s omitted) $245,422 $300,266 $500,473 $500,465 $317,736 $199,404
-------- -------- -------- -------- -------- --------
Ratio of expenses to
average net assets 1.93%*@ 1.76%@ 1.76%@ 1.81%@ 1.89% 1.94%
Ratio of net income or loss to
average net assets .39%* .21% .15% .18% .20% (.29)%
Portfolio turnover rate 60.28%+ 95.44% 61.80% 32.49% 32.24% 17.02%
</TABLE>
- ----------
(a) Per share information is calculated using the average shares outstanding
method.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expenses. These arrangements resulted in a reduction to
the net expense ratio by .01%, .00%, .00% and .01%, for the six months
ended April 30, 1999 and the years ended October 31, 1998, 1997 and 1996,
respectively. The operating expense ratio after reflecting these
arrangements were 1.92%, 1.76%, 1.76% and 1.80% for the six months ended
April 30, 1999 and the years ended October 31, 1998, 1997 and 1996,
respectively.
+ Non annualized.
* Annualized.
See Accompanying Notes to Financial Statements.
18
<PAGE>
WARBURG PINCUS EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For a Advisor Class Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ---------------------------------------
(Unaudited) 1998 1997 1996 1995**
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value,
beginning of period $ 6.44 $10.87 $12.21 $11.30 $10.00
------ ------ ------ ------ ------
Investment activities:
Net investment income (loss) (0.75) 0.21 0.00 (0.08) 0.14
Net gains or losses on
investments and foreign
currency related items
(both realized and unrealized) 1.91 (4.16) (1.33) 1.11 1.19
------ ------ ------ ------ ------
Total from investment activities 1.16 (3.95) (1.33) 1.03 1.33
------ ------ ------ ------ ------
Distributions:
From net investment income 0.00 (0.04) 0.00 (0.05) (0.03)
From realized capital gains 0.00 (0.44) (0.01) (0.07) 0.00
------ ------ ------ ------ ------
Total distributions 0.00 (0.48) (0.01) (0.12) (0.03)
------ ------ ------ ------ ------
Net asset value, end of period $ 7.60 $ 6.44 $10.87 $12.21 $11.30
====== ====== ====== ====== ======
Total return 18.01%+ (37.71)% (10.94)% 9.20% 13.29%+
Ratios/Supplemental data:
Net assets, end of period
(000s omitted) $ 16 $ 26 $ 266 $ 149 $ 1
Ratio of expenses to
average net assets 1.90%*@ 1.90%@ 1.90%@ 1.90%@ 1.22%*
Ratio of net income (loss) to
average net assets 1.08%* 1.01% (.09)% (.57)% 1.76%*
Decrease reflected in above
operating expense ratios
due to waviers/reimbursements .86%* .94% .58% .65% 16.36%*
Portfolio turnover rate 110.76%+ 125.59% 92.48% 61.84% 57.76%+
</TABLE>
- ----------
** For the period December 30, 1994 (commencement of operations) through
October 31, 1995.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expense. These arrangements had no effect on the fund's
expense ratio.
+ Non annualized.
* Annualized.
See Accompanying Notes to Financial Statements.
19
<PAGE>
WARBURG PINCUS GLOBAL POST-VENTURE CAPITAL FUND
FINANCIAL HIGHLIGHTS
(For a Advisor Class Share of the Fund Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ------------------------------
(Unaudited) 1998 1997 1996**
------ ------ ------ ------
<S> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value, beginning of period $10.46 $11.11 $ 9.85 $10.00
------ ------ ------ ------
Investment activities:
Net investment loss (0.02) (0.15) (0.15) 0.00
Net gains or losses on investments and foreign
currency related items (both realized
and unrealized) 5.05 (0.11) 1.41 (0.15)
------ ------ ------ ------
Total from investment activities 5.03 (0.26) 1.26 (0.15)
------ ------ ------ ------
Distributions:
From net investment income 0.00 (0.28) 0.00 0.00
From realized capital gains (0.03) (0.11) 0.00 0.00
------ ------ ------ ------
Total distributions (0.03) (0.39) 0.00 0.00
------ ------ ------ ------
Net asset value, end of period $15.46 $10.46 $11.11 $ 9.85
====== ====== ====== ======
Total return 48.25%+ (2.31)% 12.79% (1.50)%+
Ratios and supplemental data
Net assets, end of period (000s omitted) $ 2 $ 1 $ 1 $ 6
Ratio of expenses to average net assets 1.57%*@ 1.90%@ 1.90%@ 1.90%*@
Ratio of net income (loss) to average net assets 3.22%* (1.26)% (1.15)% (.78)%*
Decrease reflected in above operating ratios due to
waviers/reimbursements 2.63%* 45.95% 11.16% 22.23%*
Portfolio turnover rate 140.24%+ 186.67% 207.25% 5.85%+
</TABLE>
- ----------
** For the period September 30, 1996 (commencement of operations) through
October 31, 1996.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expenses. These arrangements had no effect on the fund's
expense ratio.
+ Non annualized.
* Annualized.
See Accompanying Notes to Financial Statements.
20
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
The Warburg Pincus International Equity Fund and the Warburg Pincus Global
Post-Venture Capital Fund are registered under the Investment Company Act of
1940, as amended (the 1940 Act), as diversified, open-end management investment
companies, and the Warburg Pincus Emerging Markets Fund (the Emerging Markets
Fund) which is registered under the 1940 Act as a non-diversified, open-end
management investment company.
Investment objectives for each fund are as follows: the International
Equity Fund, seek long-term capital appreciation; the Emerging Markets Fund
seeks growth of capital; and the Global Post-Venture Capital Fund seeks
long-term growth of capital.
Each fund offers two classes of shares, one class being referred to as the
Common Class and one class being referred to as the Advisor Class. Common and
Advisor Class shares in each fund represent an equal pro rata interest in such
fund, except that they bear different expenses which reflect the difference in
the range of services provided to them. Common Class shares for the Emerging
Markets Fund and the Global Post-Venture Capital Fund bear expenses paid
pursuant to a shareholder servicing and distribution plan at an annual rate of
.25% of the average daily net asset value of each fund's Common Class. Advisor
Class shares for each fund bear expenses paid pursuant to a distribution plan at
an annual rate not to exceed .75% of the average daily net asset value of each
fund's Advisor Class. Advisor Class shares are currently bearing expenses of
.50% of average daily net assets.
The net asset value of each fund is determined daily as of the close of
regular trading on the New York Stock Exchange. Each fund's investments are
valued at market value, which is generally determined using the last reported
sales price. If no sales are reported, investments are generally valued at the
mean between the last reported bid and asked prices. If market quotations are
not readily available, securities and other assets are valued by another method
that the Board of Directors believes accurately reflects fair value. Debt that
will mature in 60 days or less is valued on the basis of amortized cost, which
approximates market value, unless the Board determines that using this method
would not reflect an investment's value.
When a fund writes or purchases a call or a put option, an amount equal to
the premium received or paid by the fund is recorded as a liability or asset,
the value of which is marked-to-market daily to reflect the current market value
of the option. When the option expires, the fund realizes a gain or loss equal
to the amount of the premium received or paid. When the fund exercises an option
or enters into a closing transaction by purchasing or selling an offsetting
option, it realizes a gain or loss without regard to any
21
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies -- (cont'd)
unrealized gain or loss on the underlying security. The potential loss
associated with purchasing an option is limited to the premium paid, and the
premium would partially offset any gains achieved from its use.
The books and records of the funds are maintained in U.S. dollars.
Transactions denominated in foreign currencies are recorded at the current
prevailing exchange rates. All assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the current exchange rate
at the end of the period. Translation gains or losses resulting from changes in
the exchange rate during the reporting period and realized gains and losses on
the settlement of foreign currency transactions are reported in the results of
operations for the current period. The funds do not isolate that portion of
realized gains and losses on investments in equity securities which are due to
changes in the foreign exchange rate from that which are due to changes in
market prices of equity securities. The funds isolate that portion of realized
gains and losses on investments in debt securities which are due to changes in
the foreign exchange rate from that which are due to changes in market prices of
debt securities.
The funds may invest in securities of foreign countries and governments
which involve certain risks in addition to those inherent in domestic
investments. Such risks generally include, among others, currency risks
(fluctuations in currency exchange rates) information risk (key information may
be inaccurate or unavailable) and political risk (expropriation, nationalization
or the imposition of capital or currency controls or punitive taxes). Other
risks of investing in foreign securities include liquidity and valuation risks.
The International Equity and the Emerging Markets Funds' investments in
securities of issuers located in less developed countries considered to be
"emerging markets" involve risks in addition to those generally applicable to
foreign securities. Focusing on emerging (less developed) markets involves
higher levels of risk, including increased currency, information, liquidity,
market, political and valuation risks. Deficiencies in regulatory oversight,
market infrastructure, shareholder protections and company laws could expose the
portfolio to operational and other risks as well. Some countries may have
restrictions that could limit the portfolio's access to attractive
opportunities. Additionally, emerging markets often face serious economic
problems (such as high external debt, inflation and unemployment) that could
subject the portfolio to increased volatility or substantial declines in value.
Security transactions are accounted for on a trade date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
22
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies -- (cont'd)
ex-dividend date. Income, expenses (excluding class-specific expenses,
principally distribution, shareholder servicing fees and transfer agent fees)
and realized/unrealized gains/losses are allocated proportionately to each class
of shares based upon the relative net asset value of outstanding shares. The
cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes.
Dividends from net investment income and distributions of net realized
capital gains, if any, are declared and paid annually for all funds. However, to
the extent that a net realized capital gain can be reduced by a capital loss
carryover, such gain will not be distributed. Income and capital gain
distributions are determined in accordance with federal income tax regulations
which may differ from generally accepted accounting principles.
No provision is made for federal taxes as it is each fund's intention to
continue to qualify for and elect the tax treatment applicable to regulated
investment companies under the Internal Revenue Code of 1986, as amended, and
make the requisite distributions to its shareholders which will be sufficient to
relieve it from federal income and excise taxes.
Costs incurred in connection with organization and offering of shares have
been deferred and are being amortized over a period of five years and one year,
respectively, from the date each fund commenced its operations.
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, each fund, along with other funds advised by Warburg Pincus Asset
Management, Inc., the funds investment adviser (Warburg) (collectively the
Warburg Funds), transfers uninvested cash balances to a pooled cash account,
which is invested in repurchase agreements secured by U.S. government
securities. Securities pledged as collateral for repurchase agreements are held
by the funds' custodian bank until the agreements mature. Each agreement
requires that the market value of the collateral be sufficient to cover payments
of interest and principal; however, in the event of default or bankruptcy by the
other party to the agreement, retention of the collateral may be subject to
legal proceedings.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates.
23
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies -- (cont'd)
The funds have an arrangement with their transfer agent whereby interest
earned on uninvested cash balances is used to offset a portion of the transfer
agent expense.
For the six months ended April 30, 1999, the funds received credits or
reimbursements under this arrangement as follows:
Fund Amount
---- --------
International Equity $28,357
Emerging Markets 1,093
Global Post-Venture Capital 86
2. Investment Adviser, Co-administrators and Distributor
Warburg, which is indirectly controlled by Warburg, Pincus & Co., serves as
each fund's investment adviser. On February 15, 1999, Warburg Pincus & Co. and
Credit Suisse Group announced that they reached an agreement for Credit Suisse
to acquire Warburg. Under the terms of the arrangement, no immediate changes are
planned to Warburg investment portfolio managers and investment professionals.
The Warburg Pincus funds' Board of Directors and shareholders have approved the
"assignment" of each fund's current investment advisory agreement with Warburg.
The transaction is expected to be completed in mid-1999. For its investment
advisory services, Warburg is entitled to receive the following fees computed
daily and payable monthly based on each fund's average daily net assets:
Fund Annual Rate
------ ---------------------------------
International Equity 1.00% of average daily net assets
Emerging Markets 1.25% of average daily net assets
Global Post-Venture Capital 1.25% of average daily net assets
For the six months ended April 30, 1999, investment advisory fees, waivers
and reimbursements were as follows:
<TABLE>
<CAPTION>
Gross Net Expense
Fund Advisory Fee Waiver Advisory Fee Reimbursements
---- ------------ -------- ------------ --------------
<S> <C> <C> <C> <C>
International Equity $6,895,113 $ 0 $6,895,113 $ 0
Emerging Markets 362,889 (222,141) 140,748 0
Global Post-VentureCapital 26,314 (26,314) 0 (31,933)
</TABLE>
Abbott Capital Management, LLC (Abbott) serves as sub-investment adviser
for the Global Post-Venture Fund's assets invested in U.S. or foreign private
limited partnerships or other investment funds (Private Fund Investments).
Pursuant to the sub-advisory agreement between Abbott and Warburg, Abbott is
entitled to a quarterly fee from Warburg at the annual
24
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
2. Investment Adviser, Co-administrators and Distributor -- (cont'd)
rate of 1.00% of the value of the fund's Private Fund Investments as of the end
of each calendar quarter. No compensation is paid by the Global Post-Venture
Capital Fund to Abbott for its sub-investment advisory services.
Counsellors Funds Service, Inc. (CFSI), a wholly-owned subsidiary of
Warburg, and PFPC, Inc. (PFPC), an indirect, wholly-owned subsidiary of PNC Bank
Corp. (PNC), serve as each fund's co-administrators. For its administrative
services, CFSI currently receives a fee calculated at an annual rate of .10% of
each fund's average daily net assets.
For the six months ended April 30, 1999, administrative services fees
earned by CFSI were as follows:
Fund Co-Administration Fee
---- ---------------------
International Equity $689,511
Emerging Markets 29,031
Global Post-Venture Capital 2,105
For administrative services, PFPC currently receives a fee calculated at an
annual rate of .12% on each fund's first $250 million in average daily net
assets, .10% on the next $250 million in average daily net assets, .08% on the
next $250 million in average daily net assets and .05% of the average daily net
assets over $750 million.
For the six months ended April 30, 1999, administrative service fees earned
and voluntarily waived by PFPC (including out of pocket expenses) were as
follows:
<TABLE>
<CAPTION>
Net
Fund Co-Administration Fee Waiver Co-Administration Fee
---- ----------------- ---------- ---------------------
<S> <C> <C> <C>
International Equity $543,111 $ 0 $543,111
Emerging Markets 40,348 (16,508) 23,840
Global Post-Venture Capital 4,386 (2,526) 1,860
</TABLE>
Counsellors Securities Inc. (CSI), also a wholly-owned subsidiary of
Warburg, serves as each fund's distributor. No compensation is paid by the
International Equity Fund to CSI for distribution services. For its shareholder
servicing and distribution services, CSI receives a fee at an annual rate of
.25% of the average daily net assets of each fund's Common Class (other than the
International Equity Fund) pursuant to a shareholder servicing and distribution
plan adopted by each fund pursuant to Rule 12b-1 under the 1940 Act. On February
6, 1998, the Board of Directors of the Major Foreign Markets Fund approved
suspension of its fee. For its shareholder servicing and distribution services,
CSI receives a fee at an annual rate of .50%, of the
25
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
2. Investment Adviser, Co-administrators and Distributor -- (cont'd)
average daily net assets of the International Equity, the Emerging Markets, and
the Global Post-Venture Capital Funds' Advisor Class pursuant to distribution
plan adopted by each fund pursuant to Rule 12b-1 under the 1940 Act.
For the six months ended April 30, 1999, shareholder servicing and
distribution fees earned by CSI were as follows:
Shareholder Servicing/
Fund Distribution Fee
---- ----------------------
International Equity Fund
Advisor Class $701,338
========
Emerging Markets Fund
Common Class $ 72,558
Advisor Class 40
--------
$ 72,598
========
Global Post-Venture Capital Fund
Common Class $ 5,261
Advisor Class 1
--------
$ 5,262
========
3. Line of Credit
The funds, together with certain other Warburg funds, have established
committed and uncommitted lines of credit facilities with PNC for temporary or
emergency purposes primarily relating to unanticipated fund share redemptions.
Under the terms of the committed line of credit, the Warburg funds with access
to the facility pay a comittment fee at a rate of .07% per annum on the average
daily balance of the line of credit, which is undisbursed and uncanceled during
the preceding quarter. In addition, the Warburg funds will pay interest on
borrowings at the bank's base rate plus .45%. Under the terms of the uncommitted
lines of credit, the Warburg funds will pay interest on borrowings at the bank's
base rate plus .55%. Aggregate borrowings for each fund under the committed and
uncommitted lines of credit with PNC may not exceed the lowest of (a)
thirty-three and one-third percent (33 1/3%) of the assets of such fund, for any
fund that does not invest at least sixty-five percent (65%) of its assets in
international equity or fixed income securities (an International Fund) and
twenty-five percent (25%) of the assets of any fund that is an International
fund or (b) the
26
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
3. Line of Credit -- (cont'd)
maximum amount permitted by such fund's investment policies and restrictions. At
April 30, 1999 and during the six months ended April 30, 1999, the following
funds had borrowings under the lines of credit agreement:
<TABLE>
<CAPTION>
Average Maximum Loan
Average Daily Interest Daily Loan Outstanding
Fund Loan Balance Rate % Outstanding at 04/30/99
---- -------------- -------- ----------- -----------
<S> <C> <C> <C> <C>
International Equity $4,021,855 5.40 $65,819,000 $ 0
Emerging Markets 30,668 5.30 2,182,000 0
Global Post-Venture Capital 1,345 5.38 259,000 0
</TABLE>
4. Investments in Securities
For the six months ended April 30, 1999, purchases and sales of investment
securities (excluding short-term investments) were as follows:
Fund Purchases Sales
---- ------------ --------------
International Equity $819,383,728 $1,316,362,763
Emerging Markets 62,429,96 62,253,602
Global Post-Venture Capital 5,984,138 6,325,801
At April 30, 1999, the net unrealized appreciation from investments for
those securities having an excess of value over cost and net unrealized
depreciation from investments for those securities having an excess of cost over
value (based on cost for federal income tax purposes) was as follows:
<TABLE>
<CAPTION>
Net Unrealized
Unrealized Unrealized Appreciation
Fund Appreciation Depreciation (Depreciation)
---- ------------ ------------ --------------
<S> <C> <C> <C>
International Equity $221,158,037 $(33,518,974) $187,639,063
Emerging Markets 12,794,750 (1,718,752) 11,075,998
Global Post-Venture Capital 1,185,152 (203,849) 981,303
</TABLE>
5. Equity Swap Transactions
The International Equity and the Emerging Markets Funds each entered into
equity swap agreements dated January 7, 1999, January 8, 1999 and January 11,
1999. Each fund paid a notional amount plus a 1.25% upfront fee for a basket of
Singapore local common stocks. The initial notional amount represented the
then-current market value of the common stock. The notional amount is
marked-to-market daily. The swap agreements expire on
27
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
5. Equity Swap Transactions -- (cont'd)
January 8, 2001, but are terminable by either party on one business day's
notice. The final notional amount at termination will be the average execution
price of unwinding the counterparty's hedge for the swap (the sale of the basket
of common stocks) at termination. Each fund will receive the final notional
amount, less a 1.25% fee, five business days after the termination date.
During the term of the equity swap agreements, each fund is entitled to
dividends on the stock less a dividend withholding tax of 26% and a 1%
procesisng fee (not to exceed $1,000). Each fund should recognize the net
dividend amount received as dividend income on the ex-dividend date and will
receive each dividend five business days after the payment date. In addition, a
fund may instruct the counterparty regarding participation in any rights
offerings of the common stock, in exchange for the subscription price plus a
.075% fee to the counterparty.
At April 30, 1999, the International Equity Fund had the following open
equity swap agreements:
Market Notional Unrelaized
Value Amount Appreciation
----------- ----------- ------------
Basket 1 $ 9,113,892 $ 6,791,945 $2,321,947
Basket 2 2,336,587 1,859,049 477,538
Basket 3 7,415,889 6,499,780 916,109
----------- ----------- ----------
$18,866,368 $15,150,774 $3,715,594
=========== =========== ==========
At April 30, 1999, the Emerging Markets Fund had the following open equity
swap agreements:
Market Notional Unrelaized
Value Amount Appreciation
-------- -------- ------------
Basket 1 $376,689 $280,721 $ 95,968
Basket 2 96,565 76,831 19,734
Basket 3 306,343 268,523 37,820
-------- -------- --------
$779,597 $626,075 $153,522
======== ======== ========
28
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
6. Capital Share Transactions
Each fund, except the Global Post-Venture Capital Fund, is authorized to
issue three billion full and fractional shares of capital stock, $.001 par value
per share, of which two billion shares of each fund are classified as the
Advisor Class. The Global Post-Venture Capital Fund is authorized to issue three
billion full and fractional shares of capital stock, $.001 par value per share,
of which one billion shares are classified as the Advisor Class.
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
--------------------------------------------------------------------------
Common Class Advisor Class
------------------------------------ ---------------------------------
Six Months For the Six Months For the
Ended Year Ended Ended Year Ended
April 30, 1999 October 31, April 30, 1999 October 31,
(Unaudited) 1998 (Unaudited) 1998
--------------- --------------- -------------- -------------
<S> <C> <C> <C> <C>
Shares sold 31,902,685 49,208,088 1,084,637 2,638,046
Shares issued to shareholders on
reinvestment of dividends 0 16,336,304 0 3,778,779
Shares redeemed (59,139,033) (99,781,019) (5,753,583) (12,548,585)
--------------- --------------- ------------- -------------
Net decrease in shares outstanding (27,236,348) (34,236,627) (4,668,946) (6,131,760)
=============== =============== ============= =============
Proceeds from sale of shares $ 562,921,365 $ 896,359,095 $ 18,547,791$ 49,230,407
Reinvested dividends 0 272,489,395 0 62,614,371
Net asset value of shares redeemed (1,046,996,922) (1,826,723,786 (101,054,273) (228,193,356)
--------------- --------------- ------------- -------------
Net decrease from capital share transactions $ (484,075,557 $ (657,875,296) $ (82,506,482) $(116,348,578)
=============== =============== ============= =============
</TABLE>
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
-------------------------------------------------------------------------
Common Class Advisor Class
----------------------------------- ---------------------------------
Six Months For the Six Months For the
Ended Year Ended Ended Year Ended
April 30, 1999 October 31, April 30, 1999 October 31,
(Unaudited) 1998 (Unaudited) 1998
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Shares sold 8,706,684 13,544,543 1 235,380
Shares issued to shareholders on
reinvestment of dividends 0 582,196 0 1,113
Shares redeemed (8,970,786) (19,392,450) (1,941) (256,959)
------------ ------------- ----- -----------
Net decrease in shares outstanding (264,102) (5,265,711) (1,940) (20,466)
============ ============= ======== ===========
Proceeds from sale of shares $ 59,713,094 $ 118,390,331 $ 4 $ 1,967,876
------------ ------------- ----- -----------
Reinvested dividends 0 5,373,673 0 10,321
Net asset value of shares redeemed (60,724,632) (172,692,012) (12,389) (2,218,983)
------------ ------------- ----- -----------
Net decrease from capital share transactions $ (1,011,538) $ (48,928,008) $(12,385) $ 240,786)
============ ============= ======== ===========
</TABLE>
29
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
6. Capital Share Transactions (cont'd)
<TABLE>
<CAPTION>
GLOBAL POST-VENTURE CAPITAL FUND
------------------------------------------------------------------
Common Class Advisor Class
------------------------------ --------------------------------
Six Months For the Six Months For the
Ended Year Ended Ended Year Ended
April 30, 1999 October 31, April 30, 1999 October 31,
(Unaudited) 1998 (Unaudited) 1998
-------------- ----------- -------------- ------------
<S> <C> <C> <C> <C>
Shares sold 33,771 131,789 0 0
Shares issued to shareholders on
reinvestment of dividends 971 10,620 0 4
Shares redeemed (68,832) (81,397) 0 0
--------- ---------- -- ---
Net increase (decrease) in shares outstanding (34,090) 61,012 0 4
========= ========== == ===
Proceeds from sale of shares $ 450,809 $1,626,747 $0 $ 0
Reinvested dividends 11,069 108,115 4 40
Net asset value of shares redeemed (891,758) (915,348) 0 0
--------- ---------- -- ---
Net increase (decrease) from capital
share transactions $(429,880) $ 819,514 $4 $40
========= ========== == ===
</TABLE>
7. Liabilities
At April 30, 1999, each fund had the following affiliated and investment
related liabilities:
<TABLE>
<CAPTION>
Emerging Global
International Markets Post-Venture
Equity Fund Fund Capital Fund
------------- ---------- ------------
<S> <C> <C> <C>
Payable for securities purchased (at value) $7,915,692 $6,968,632 $150,108
Administration services fee payable 98,920 5,006 392
Investment advisory fee payable 989,205 36,451 0
Distribution fee payable 44,238 13,015 981
</TABLE>
8. Net Assets
At April 30, 1999, capital contributions, undistributed net investment
income, accumulated net realized gain (loss) from security transactions and
current period distribution have been adjusted for current period permanent
book/tax differences which arose principally from differing book/tax treatments
of foreign currency and equity swap transactions. The International Equity Fund,
the Emerging Markets Fund, and the Global Post-Venture Capital Fund reclassified
$2,561,168, $605,774 and $13,626, respectively, from accumulated net realized
loss on security transactions and foreign currency related items to
undistributed net investment income. The Emerging Markets Fund and the Global
Post-Venture Capital Fund reclassified $174,547 and $22,765, respectively, from
accumulated net investment loss to capital contributions. Net investment income,
net realized gain (loss) on investments and net assets were not affected by this
reclassification.
30
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
8. Net Assets -- (cont'd)
Net assets at April 30, 1999, consisted of the following:
<TABLE>
<CAPTION>
Global
International Emerging Post-Venture
Equity Markets Capital
Fund Fund Fund
-------------- ------------ ------------
<S> <C> <C> <C>
Capital contributed, net $1,130,170,824 $132,757,000 $2,944,463
Undistributed net investment income 2,533,392 0 0
Accumulated net realized gain (loss)
from security transactions (162,125,913) (74,538,696) 956,214
Net unrealized appreciation
(depreciation) from investments and
foreign currency related items 189,565,680 10,890,326 981,448
-------------- ------------ ----------
Net assets $1,160,143,983 $ 69,108,630 $4,882,125
============== ============ ==========
</TABLE>
9. Capital Loss Carryover
At April 30, 1999, capital loss carryovers available to offset possible
future capital gains of each fund were as follows:
Capital Loss Carryover
Fund Expiring in 2006
---- ----------------------
International Equity $181,861,023
Emerging Markets 63,924,245
10. Other Financialhighlights
Each fund currently offers one other class of shares, the Common Class,
representing equal prorata interests in each of the funds. The financial
highlights for a Common Class share of each fund are as follows:
31
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
10. Other Financial Highlights -- (cont'd)
<TABLE>
<CAPTION>
International Equity Fund
--------------------------------------------------------------------------------------
Common Class
--------------------------------------------------------------------------------------
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ----------------------------------------------------------------------
(Unaudited) 1998 1997 1996 1995 1994
-------------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value,
beginning of period $ 16.64 $ 20.76 $ 20.69 $ 19.30 $ 20.51 $ 17.00
-------- ---------- ---------- ---------- ---------- ----------
Investment activities:
Net investment income (loss) (0.80) 0.12(a) 0.04 0.22 0.12 0.09
Net gains or losses on
investments and foreign
currency related items
(both realized and unrealized) 2.48 (1.38) 0.88 1.73 (0.67) 3.51
-------- ---------- ---------- ---------- ---------- ----------
Total from investment
activities 1.68 (1.26) 0.92 1.95 (0.55) 3.60
-------- ---------- ---------- ---------- ---------- ----------
Distributions:
From net investment income 0.00 (0.14) (0.11) (0.56) (0.13) (0.04)
In excess of net investment
income 0.00 0.00 0.00 0.00 0.00 (0.01)
From realized capital gains 0.00 (2.72) (0.74) 0.00 (0.53) (0.04)
-------- ---------- ---------- ---------- ---------- ----------
Total distributions 0.00 (2.86) (0.85) (0.56) (0.66) (0.09)
-------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 18.32 $ 16.64 $ 20.76 $ 20.69 $ 19.30 $ 20.51
======== ========== ========== ========== ========== ==========
Total return 10.10%+ (6.12)% 4.54% 10.35% (2.55)% 21.22%
Ratios and supplemental data:
Net assets, end of period
(000s omitted) $914,722 $1,283,673 $2,312,042 $2,885,453 $2,068,207 $1,533,872
Ratio of expenses to
average net assets 1.43%*@ 1.36%@ 1.33%@ 1.38%@ 1.39% 1.44%
Ratio of net income to
average net assets .83%* .65% .56% .62% .69% .19%
Portfolio turnover rate 60.28%+ 95.44% 61.80% 32.49% 39.24% 17.02%
</TABLE>
- ----------
(a) Per share information is calculated using the average shares outstanding
method.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expenses. These arrangements resulted in a reduction to
the net expense ratio by .00%, .00%, .01% and .01% for the six months ended
April 30, 1999 and years ended October 31, 1998, 1997 and 1996,
respectively. The operating expense ratio after reflecting these
arrangements were 1.43%, 1.36%, 1.32% and 1.37% for the six months ended
April 30, 1999 and years ended October 31, 1998, 1997 and 1996,
respectively.
+ Non annualized.
* Annualized.
32
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
10. Other Financial Highlights -- (cont'd)
<TABLE>
<CAPTION>
Emerging Markets Fund
----------------------------------------------------------------
Common Class
----------------------------------------------------------------
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ------------------------------------------------
(Unaudited) 1998 1997 1996 1995**
-------------- ------- -------- -------- ------
<S> <C> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value,
beginning of period $ 6.59 $ 10.82 $ 12.19 $ 11.28 $10.00
------- ------- -------- -------- ------
Investment activities:
Net investment income 0.13 0.11 0.04 0.07 0.08
Net gains or losses on
investments and foreign
currency related items
(both realized and unrealized) 1.07 (3.86) (1.34) 0.99 1.25
------- ------- -------- -------- ------
Total from investment activities 1.20 (3.75) (1.30) 1.06 1.33
------- ------- -------- -------- ------
Distributions:
From net investment income 0.00 (0.04) (0.03) (0.08) (0.05)
From realized capital gains 0.00 (0.44) (0.04) (0.07) 0.00
------- ------- -------- -------- ------
Total distributions 0.00 (0.48) (0.07) (0.15) (0.05)
------- ------- -------- -------- ------
Net asset value, end of period $ 7.79 $ 6.59 $ 10.82 $ 12.19 $11.28
======= ======= ======== ======== ======
Total return 18.21%+ (35.95)% (10.71)% 9.46% 13.33%+
Ratios and supplemental Data:
Net assets, end of period
(000s omitted) $69,093 $60,189 $155,806 $218,421 $6,780
Ratio of expenses to
average net assets 1.65%*@ 1.65%@ 1.66%@ 1.62%@ 1.00%*
Ratio of net income to
average net assets 1.49%* 1.00% .24% .31% 1.25%*
Decrease reflected in above operating
expense ratios due to waivers/
reimbursements .82%* .63% .46% .77% 11.08%*
Portfolio turnover rate 110.76%+ 125.59% 92.48% 61.84% 57.76%+
</TABLE>
- ----------
** For the period December 30, 1994 (commencement of operations) through
October 31, 1995.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expenses. These arrangements resulted in a reduction to
thenet expense ratio by .00%, .00%, .01% and .01%, for the six months ended
April 30, 1999 and years ended October 31, 1998, 1997 and for the ten
months ended October 31, 1996, respectively. The operating expense ratio
after reflecting these arrangements were 1.65%, 1.65%, 1.65% and 1.61% for
the six months ended April 30, 1999 and years ended October 31, 1998, 1997
and for the ten months ended October 31, 1996, respectively.
+ Non annualized.
* Annualized.
33
<PAGE>
Warburg Pincus International Equity Funds
Notes to Financial Statements (cont'd)
April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
10. Other Financial Highlights -- (cont'd)
<TABLE>
<CAPTION>
Global Post-Venture Capital Fund
----------------------------------------------
Common Class
----------------------------------------------
For the Six
Months Ended For the Year Ended October 31,
April 30, 1999 ------------------------------
(Unaudited) 1998 1997 1996**
-------------- ------ ------ ------
<S> <C> <C> <C> <C>
PERIOD ENDED:
Per-share data
Net asset value, beginning of period $10.53 $11.15 $ 9.86 $10.00
------ ------ ------ ------
Investment activities:
Net investment loss (0.08) (0.02) (0.13) 0.00
Net gains or losses on investments and foreign
currency related items (both realized
and unrealized) 5.14 (0.20) 1.42 (0.14)
------ ------ ------ ------
Total from investment activities 5.06 (0.22) 1.29 (0.14)
------ ------ ------ ------
Distributions:
From net investment income 0.00 (0.29) 0.00 0.00
From realized capital gains (0.03) (0.11) 0.00 0.00
------ ------ ------ ------
Total distributions (0.03) (0.40) 0.00 0.00
------ ------ ------ ------
Net asset value, end of period $15.56 $10.53 $11.15 $ 9.86
====== ====== ====== ======
Total return 48.22%+ (1.91)% 13.08% (1.40)%+
Ratios and supplemental data
Net assets, end of period (000s omitted) $4,880 $3,661 $3,197 $3,007
Ratio of expenses to average net assets 1.65%*@ 1.65%@ 1.66%@ 1.65%*@
Ratio of net loss to average net assets (.43)%* (1.01)% (.96)% (.20)%*
Decrease reflected in above operating ratios due to
waviers/reimbursements 2.89%* 3.90% 6.48% 21.71%*
Portfolio turnover rate 140.24%+ 186.67% 207.25% 5.85%+
</TABLE>
- ----------
** For the period September 30, 1996 (commencement of operations) through
October 31, 1996.
@ Interest earned on uninvested cash balances is used to offset portions of
the transfer agent expenses. These arrangements resulted in a reduction to
the net expense ratio by .00%, .00%, .01% and .00%, for the six months
ended April 30, 1999 and years ended October 31, 1998, 1997 and for the one
month ended October 31, 1996, respectively. The operating expense ratio
after reflecting these arrangements were 1.65%, 1.65%, 1.65% and 1.65% for
the six months ended April 30, 1999 and years ended October 31, 1998, 1997
and for the one month ended October 31, 1996, respectively.
+ Non annualized.
* Annualized.
34
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<PAGE>
WARBURG PINCUS
ADVISOR FUNDS
COUNSELLORS
SECURITIES INC.,
DISTRIBUTOR
800-222-8977
[LOGO]
ADISF-3-0499
