<PAGE>
1995 SEMIANNUAL REPORT
CENTENNIAL
CALIFORNIA TAX EXEMPT TRUST
- ------------------------------------------------------------------------------
December 31, 1995
RS0180.001.0296
<PAGE>
DEAR CENTENNIAL CALIFORNIA TAX EXEMPT TRUST SHAREHOLDER:
1995 was a year marked by declining interest rates, making it a strong period
for capital appreciation for many areas of the bond markets.
The other side of this appreciation, however, was declining rates, meaning that
newly issued bonds were coming to market with lower yields. This factor has been
the most important catalyst behind our investment decisions for the past six
months.
Because we strive to pay the highest current tax-free income consistent with
safety of principal, the past year's rate declines caused us to lengthen the
average maturity of our portfolio in an effort to take advantage of higher-
yielding securities for as long as possible. However, because we had correctly
anticipated this trend, we'd begun our move into longer securities at the end of
1994.
Longer securities were bid up in the markets as the year progressed, and
continued to offer income superior to that of most newer issues, so the
portfolio was positioned in the right place at the right time. In fact, the
Trust was among the top 35% of all California tax exempt money market funds
tracked by IBC/Donoghue for the period.(1)
The Trust's compounded annualized yield for the six months ended December 31,
1995 was 3.16%. The corresponding yield without compounding was 3.11%. For
investors in the 36% federal and 10% California tax brackets, this is equal to a
taxable yield of 5.49% with compounding and 5.40% without compounding.(2)
Seven-day annualized yields with and without compounding for the Trust for the
six months ended December 31, 1995 were 3.49% and 3.43%, respectively.
Looking forward, we believe the market will continue to be relatively strong.
Without a major shift in policy by the Federal Reserve, we expect to remain
focused on buying longer-term securities as much as possible. Our investment
policy over the past six months has allowed us to maintain our yield as well as
our emphasis on stability of principal, and we expect these favorable conditions
to continue.(3)
The Trust continues to offer investors income that is free from federal and
California state income taxes. We appreciate the confidence you have placed in
the Centennial California Tax Exempt Trust and look forward to helping you
continue to meet your financial goals in the future.
Sincerely,
/s/JAMES C. SWAIN
James C. Swain
Chairman--Centennial California
Tax Exempt Trust
/s/BRIDGET A. MACASKILL
Bridget A. Macaskill
President--Centennial California
Tax Exempt Trust
January 22, 1996
1. IBC/Donoghue, Inc., an independent fund monitoring service. Ranking of
34 funds for the six months ended December 31, 1995.
2. Compounded yields assume reinvestment of dividends. A portion of the
Trust's distributions may be subject to federal and state income taxes. For
investors subject to the federal and/or state alternative minimum tax, a
portion of the Trust's distributions may increase this tax.
3. The Trust is neither insured nor guaranteed by the U.S. government. There
is no assurance that the Trust will maintain a stable $1 share price in the
future.
2
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<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS December 31, 1995 (Unaudited)
Centennial California Tax Exempt Trust
FACE VALUE
AMOUNT SEE NOTE 1
<S> <C> <C>
=================================================================================================================================
SHORT-TERM TAX-EXEMPT OBLIGATIONS - 97.9%
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 97.9%
----------------------------------------------------------------------------------------------------------------------
Anaheim, California Housing Authority Multifamily Housing Revenue
Bonds, Bel Page Project, Series A, Remarketed, 5.10%(1) $1,000,000 $1,000,000
----------------------------------------------------------------------------------------------------------------------
Anaheim, California Housing Authority Multifamily Housing
Revenue Refunding Bonds, Park Vista Apts., Series A, 5.35%(1) 3,000,000 3,000,000
----------------------------------------------------------------------------------------------------------------------
Antioch, California Certificates of Participation, Antioch
Development Agency Water Treatment Project, Prerefunded, MBIA
Insured, 7.875%, 7/1/96(2) 4,735,000 4,966,200
----------------------------------------------------------------------------------------------------------------------
Brea, California Redevelopment Agency Sub-Tax Allocation Bonds,
Redevelopment Project-Area AB, Prerefunded, 8.40%, 9/15/96(2) 5,675,000 6,002,050
----------------------------------------------------------------------------------------------------------------------
Brea, California Redevelopment Agency Sub-Tax Allocation Bonds,
Redevelopment Project-Area AB, Prerefunded, 8.50%, 9/15/96 1,300,000 1,375,880
----------------------------------------------------------------------------------------------------------------------
California Economic Development Financing Authority Industrial
Development Revenue Bonds, Inland Empire Venture, LLC Project,
3.955%(1) 2,000,000 2,000,000
----------------------------------------------------------------------------------------------------------------------
California Housing Finance Agency Home Mtg. Revenue Bonds,
Series 1995-E, FGIC Insured, 4.60%, 2/1/96(2) 3,500,000 3,500,000
----------------------------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority Revenue Bonds,
Chevron USA, Inc. Project, 4.50%, 5/15/96(2) 2,500,000 2,504,477
----------------------------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority Revenue Bonds,
Pacific Gas & Electric Co. Project, Series C, 3.60%, 3/8/96(2) 4,000,000 4,000,000
----------------------------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority Revenue Bonds,
Pacific Gas & Electric Co. Project, Series E, 3.50%, 2/15/96(2) 5,000,000 5,000,000
----------------------------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority Revenue Bonds,
Southern California Edison Co. Project, Series A, 3.655%, 2/15/96(2) 1,200,000 1,200,000
----------------------------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority Solid Waste Disposal
Revenue Bonds, Western Waste Industries, Series A, 5.20%(1) 4,500,000 4,500,000
----------------------------------------------------------------------------------------------------------------------
California State General Obligation Bonds, Series A-3, MBIA Insured,
5.35%(1) 3,000,000 3,000,000
----------------------------------------------------------------------------------------------------------------------
California State Revenue Anticipation Wts., Series C, FGIC Insured,
5.75%, 4/25/96 900,000 905,308
----------------------------------------------------------------------------------------------------------------------
California Statewide Communities Development Corp. Industrial
Development Revenue Bonds, Propak California Corp., Series B,
4.90%(1) 900,000 900,000
----------------------------------------------------------------------------------------------------------------------
Costa Mesa, California Certificates of Participation, Orange County
Performing Arts Center, 5.40%(1) 2,795,000 2,795,000
----------------------------------------------------------------------------------------------------------------------
Covina, California Redevelopment Agency Multifamily Revenue Refunding
Bonds, Housing-Shadowhills Apts., Inc., Series A, 5.90%(1) 3,000,000 3,000,000
----------------------------------------------------------------------------------------------------------------------
Fairfield, California Industrial Development Authority Revenue Bonds,
Herman G. Rowland, 5.40%(1) 1,350,000 1,350,000
----------------------------------------------------------------------------------------------------------------------
Los Angeles County, California Certificates of Participation,
Van Nuys Courthouse Project, Prerefunded, 9%, 6/1/96(2) 2,000,000 2,082,366
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Continued)
Centennial California Tax Exempt Trust
FACE VALUE
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED) AMOUNT SEE NOTE 1
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (CONTINUED)
----------------------------------------------------------------------------------------------------------------------
Los Angeles County, California Convention & Exhibition Center
Authority Certificates of Participation, Series 1989-A, 3.75%(1) $2,000,000 $ 2,000,000
----------------------------------------------------------------------------------------------------------------------
Los Angeles County, California Housing Authority Revenue Bonds,
Park Sierra Project, 5.30%(1) 2,000,000 2,000,000
----------------------------------------------------------------------------------------------------------------------
Los Angeles County, California Metropolitan Transportation Authority
Revenue Anticipation Nts., Series 1995A, 5%, 4/25/96 9,400,000 9,426,505
----------------------------------------------------------------------------------------------------------------------
Northern California Power Agency Public Power Revenue Bonds, Hydro-
electric Project No. 1, Prerefunded, Series A, 8%, 7/1/96(2) 2,000,000 2,082,849
----------------------------------------------------------------------------------------------------------------------
Northern California Power Agency Public Power Revenue Refunding
Bonds, Hydroelectric Project No. 1, Prerefunded, Series A, 8%,
7/1/96(2) 1,000,000 1,040,610
----------------------------------------------------------------------------------------------------------------------
Oakland, California Redevelopment Agency Refunding Tax Allocation
Bonds, Central District Redevelopment Project, Prerefunded, AMBAC
Insured, 7.50%, 2/1/96(2) 1,250,000 1,278,174
----------------------------------------------------------------------------------------------------------------------
Oceanside, California Multifamily Revenue Bonds, Lakeridge Apts.
Project, 5.45%(1) 1,800,000 1,800,000
----------------------------------------------------------------------------------------------------------------------
Palm Springs, California Community Redevelopment Agency Certificates
of Participation, Headquarters Hotel, Series 7, 4.80%(1) 400,000 400,000
----------------------------------------------------------------------------------------------------------------------
Pittsburg, California Mtg. Obligation Gtd. Revenue Bonds, Series A,
4.05%(1) 3,000,000 3,000,000
----------------------------------------------------------------------------------------------------------------------
Sacramento, California Municipal Utility District Tax-Exempt
Commercial Paper, 3.50%, 1/19/96(2) 6,000,000 6,000,000
----------------------------------------------------------------------------------------------------------------------
San Bernardino County, California Housing Authority Multifamily
Housing Revenue Refunding Bonds, Arrowview Park Apts. Project,
Series A, 5.40%(1) 4,130,000 4,130,000
----------------------------------------------------------------------------------------------------------------------
San Diego County, California Industrial Development Revenue Refunding
Bonds, San Diego Gas & Electric Co. Project, 3.35%, 3/8/96 1,500,000 1,500,000
----------------------------------------------------------------------------------------------------------------------
San Diego County, California Regional Transportation Commission
Second Senior Sales Tax Revenue Bonds, Series A, FGIC Insured, 4.75%,
4/1/96 5,000,000 5,009,404
----------------------------------------------------------------------------------------------------------------------
San Diego, California Multifamily Housing Revenue Refunding
Bonds, Coral Point Apts. Project, Series A, 5.40% 2,500,000 2,500,000
----------------------------------------------------------------------------------------------------------------------
San Marcos, California Redevelopment Agency Multifamily Housing
Bonds, San Marcos Retirement Village Project, 4.187%(1) 2,500,000 2,500,000
----------------------------------------------------------------------------------------------------------------------
Visalia, California Industrial Development Revenue Bonds, Akers West
Assn., 5.25%(1) 1,150,000 1,150,000
----------------------------------------------------------------------------------------------------------------------
West & Central Basin California Finance Authority Tax & Revenue
Anticipation Nts., 3.45%, 1/22/96(2) 2,500,000 2,500,000
----------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE 97.9% 101,398,823
----------------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 2.1 2,144,779
------------- -------------
NET ASSETS 100.0% $103,543,602
============= =============
</TABLE>
4
<PAGE>
---------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Continued)
Centennial California Tax Exempt Trust
- --------------------------------------------------------------------------------
1. Floating or variable rate obligation maturing in more than one year. The
interest rate, which is based on specific, or an index of, market interest
rates, is subject to change periodically and is the effective rate on December
31, 1995. This instrument may also have a demand feature which allows the
recovery of principal at any time, or at specified intervals not exceeding one
year, on up to 30 days' notice. Maturity date shown represents effective
maturity based on variable rate and, if applicable, demand feature.
2. Put obligation redeemable at full face value on the date reported.
See accompanying Notes to Financial Statements.
5
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES December 31, 1995(Unaudited)
Centennial California Tax Exempt Trust
==================================================================================================================================
<S> <C>
ASSETS Investments, at value - see accompanying statement $101,398,823
--------------------------------------------------------------------------------------------------
Cash 148,730
--------------------------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 1,805,958
Interest 1,331,500
--------------------------------------------------------------------------------------------------
Other 13,443
-----------------
Total assets 104,698,454
==================================================================================================================================
LIABILITIES Payables and other liabilities:
Shares of beneficial interest redeemed 1,072,525
Service plan fees 51,333
Dividends 846
Transfer and shareholder servicing agent fees 844
Other 29,304
-----------------
Total liabilities 1,154,852
==================================================================================================================================
NET ASSETS $103,543,602
-----------------
-----------------
==================================================================================================================================
COMPOSITION OF Paid-in capital $103,541,404
NET ASSETS --------------------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 2,198
--------------------------------------------------------------------------------------------------
Net assets - applicable to 103,541,404 shares of beneficial
interest outstanding $103,543,602
-----------------
-----------------
==================================================================================================================================
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $1.00
</TABLE>
See accompanying Notes to Financial Statements.
6
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS For the Six Months Ended December 31, 1995 (Unaudited)
Centennial California Tax Exempt Trust
==================================================================================================================================
<S> <C>
INVESTMENT INCOME Interest $2,059,051
==================================================================================================================================
EXPENSES Management fees - Note 3 264,202
--------------------------------------------------------------------------------------------------
Service plan fees - Note 3 104,903
--------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees - Note 3 17,859
--------------------------------------------------------------------------------------------------
Shareholder reports 11,078
--------------------------------------------------------------------------------------------------
Custodian fees and expenses 8,313
--------------------------------------------------------------------------------------------------
Legal and auditing fees 5,004
--------------------------------------------------------------------------------------------------
Registration and filing fees 2,921
--------------------------------------------------------------------------------------------------
Insurance expenses 1,549
--------------------------------------------------------------------------------------------------
Trustees' fees and expenses 759
--------------------------------------------------------------------------------------------------
Other 192
-----------
Total expenses 416,780
==================================================================================================================================
NET INVESTMENT INCOME 1,642,271
==================================================================================================================================
NET REALIZED GAIN ON INVESTMENTS 13,762
==================================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $1,656,033
-----------
-----------
</TABLE>
================================================================================
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED YEAR ENDED
DECEMBER 31, 1995 JUNE 30,
(UNAUDITED) 1995
==================================================================================================================================
<S> <C> <C>
OPERATIONS Net investment income $ 1,642,271 $ 2,133,906
--------------------------------------------------------------------------------------------------
Net realized gain (loss) 13,762 (11,564)
------------------------------
Net increase in net assets resulting
from operations 1,656,033 2,122,342
==================================================================================================================================
DIVIDENDS AND DISTRIBUTIONS
TO SHAREHOLDERS (1,642,271) (2,133,965)
==================================================================================================================================
BENEFICIAL INTEREST Net increase in net assets resulting from
TRANSACTIONS beneficial interest transactions - Note 2 11,212,005 31,953,795
==================================================================================================================================
NET ASSETS Total increase 11,225,767 31,942,172
--------------------------------------------------------------------------------------------------
Beginning of period 92,317,835 60,375,663
------------------------------
End of period $103,543,602 $92,317,835
------------------------------
------------------------------
</TABLE>
See accompanying Notes to Financial Statements.
7
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
Centennial California Tax Exempt Trust
Six Months
Ended
December 31, Year Ended June 30,
1995 --------------------------------------------------------------------
(Unaudited) 1995 1994 1993 1992 1991
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from investment operations - net
investment income and net realized gain .02 .03 .02 .02 .03 .04
Dividends and distributions to shareholders (.02) (.03) (.02) (.02) (.03) (.04)
- -------------------------------------------------===================================================================================
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(1) 1.57% 3.00% 1.82% 2.00% 3.29% 4.79%
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $103,544 $92,318 $60,376 $58,079 $48,483 $32,337
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $104,836 $71,278 $65,520 $56,082 $40,684 $16,150
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 3.11%(2) 2.99% 1.79% 1.90% 3.13% 4.09%
Expenses, before voluntary assumption
by the Manager N/A 0.83% 0.87% 0.86% 0.91% 1.09%
Expenses, net of voluntary assumption
by the Manager 0.79%(2) 0.80% 0.80% 0.80% 0.80% 0.84%
</TABLE>
1. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends reinvested in additional
shares on the reinvestment date, and redemption at the net asset value calcu-
lated on the last business day of the fiscal period. Total returns are not
annualized for periods of less than one full year. Total returns reflect
changes in net investment income only.
2. Annualized.
See accompanying Notes to Financial Statements.
8
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
Centennial California Tax Exempt Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial California Tax Exempt Trust (the Trust) is registered under the
Investment Company Act of 1940, as amended, as a non-diversified, open-end
management investment company. The Trust's investment objective is to seek the
maximum current interest income exempt from Federal and California personal
income taxes for individual investors as is consistent with preservation of
capital. The Trust's investment advisor is Centennial Asset Management
Corporation (the Manager), a subsidiary of OppenheimerFunds, Inc. (OFI). The
following is a summary of significant accounting policies consistently followed
by the Trust.
INVESTMENT VALUATION. Portfolio securities are valued on the basis of amortized
cost, which approximates market value.
FEDERAL TAXES. The Trust intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders.
Therefore, no federal income or excise tax provision is required.
DISTRIBUTIONS TO SHAREHOLDERS. The Trust intends to declare dividends from net
investment income each day the New York Stock Exchange is open for business and
pay such dividends monthly. To effect its policy of maintaining a net asset
value of $1.00 per share, the Trust may withhold dividends or make distributions
of net realized gains.
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Realized gains and losses on investments are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes. The Trust concentrates in investments in California and,
therefore, may have more credit risks related to the economic conditions of
California than a portfolio with a broader geographical diversification.
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 and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31, 1995 YEAR ENDED JUNE 30, 1995
------------------------------------ -------------------------------------
SHARES AMOUNT SHARES AMOUNT
<S> <C> <C> <C> <C>
Sold 180,835,498 $ 180,835,498 279,468,671 $ 279,468,671
Dividends and distributions 1,729,328 1,729,328 2,013,397 2,013,397
reinvested
Redeemed (171,352,821) (171,352,821) (249,528,273) (249,528,273)
------------------------------------ -------------------------------------
Net increase 11,212,005 $ 11,212,005 31,953,795 $ 31,953,795
==================================== =====================================
</TABLE>
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
Centennial California Tax Exempt Trust
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Trust which provides for a fee of .50% on the first
$250 million of average annual net assets with a reduction of .025% on each $250
million thereafter, to .40% on net assets in excess of $1 billion. The Manager
has agreed to assume Trust expenses (with specified exceptions) in excess of the
regulatory limitation of the State of California. In addition, the Manager has
voluntarily undertaken to assume Trust expenses in excess of .80% of average
annual net assets.
Shareholder Services, Inc. (SSI), a subsidiary of OFI, is the transfer and
shareholder servicing agent for the Trust, and for other registered investment
companies. SSI's total costs of providing such services are allocated ratably to
these companies.
Under an approved plan of distribution, the Trust may expend up to .20% of its
net assets annually to reimburse Centennial Asset Management Corporation, as
distributor, for costs incurred in connection with the personal service and
maintenance of accounts that hold shares of the Trust, including amounts paid to
brokers, dealers, banks and other institutions. During the six months ended
December 31, 1995, the Trust paid $455 to a broker/dealer affiliated with the
Manager as reimbursement for distribution-related expenses.
10
<PAGE>
CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
OFFICERS AND TRUSTEES
James C. Swain, Chairman and Chief Executive Officer
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Bridget A. Macaskill, Trustee and President
Ned M. Steel, Trustee
Michael A. Carbuto, Vice President
Andrew J. Donohue, Vice President
George C. Bowen, Vice President, Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
INVESTMENT ADVISOR AND DISTRIBUTOR
Centennial Asset Management Corporation
TRANSFER AND SHAREHOLDER SERVICING AGENT
Shareholder Services, Inc.
CUSTODIAN OF PORTFOLIO SECURITIES
Citibank, N.A.
INDEPENDENT AUDITORS
Deloitte & Touche LLP
LEGAL COUNSEL
Myer, Swanson, Adams & Wolf, P.C.
The financial statements included herein have been taken from the records of the
Trust without examination by the independent auditors.
This is a copy of a report to shareholders of Centennial California Tax Exempt
Trust. This report must be preceded or accompanied by a Prospectus of Centennial
California Tax Exempt Trust. For material information concerning the Trust, see
the Prospectus.
For shareholder servicing, call:
1-800-525-9310 (in U.S.)
303-671-3200 (outside U.S.)
Or write:
Shareholder Services, Inc.
P.O. Box 5143
Denver, CO 80217-5143
11
