SELIGMAN
---------------------------
SELIGMAN HENDERSON
GLOBAL FUND SERIES, INC.
INTERNATIONAL FUND
EMERGING MARKETS
GROWTH FUND
GLOBAL GROWTH
OPPORTUNITIES FUND
GLOBAL SMALLER
COMPANIES FUND
GLOBAL TECHNOLOGY FUND
ANNUAL REPORT
OCTOBER 31, 1998
INVESTING
AROUND THE WORLD
FOR CAPITAL
APPRECIATION
[LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
<PAGE>
SELIGMAN -- TIMES CHANGE...VALUES ENDURE
J. & W. SELIGMAN & CO. INCORPORATED IS A FIRM WITH A LONG TRADITION OF
INVESTMENT EXPERTISE, OFFERING A BROAD ARRAY OF INVESTMENT CHOICES TO HELP
TODAY'S INVESTORS SEEK THEIR LONG-TERM FINANCIAL GOALS.
TIMES CHANGE...
Established in 1864, Seligman's history of providing financial services has been
marked not by fanfare, but rather by a quiet and firm adherence to financial
prudence. While the world has changed dramatically in the 134 years since
Seligman first opened its doors, the firm has continued to offer its clients
high-quality investment solutions through changing times.
In the late 19th century, as the country grew, Seligman helped finance the
westward expansion of the railroads, the construction of the Panama Canal, and
the launching of urban transit systems. In the first part of the 20th century,
as America became an industrial power, the firm helped fund the growing capital
needs of the nascent automobile and steel industries.
With the formation of Tri-Continental Corporation in 1929 -- today, the nation's
largest diversified publicly-traded closed-end investment company -- Seligman
began shifting its emphasis from investment banking to investment management.
Despite the stock market crash and ensuing depression, Seligman was convinced of
the importance that investment companies could have in building wealth for
individual investors and began managing its first mutual fund in 1930.
In the decades that followed, Seligman has continued to offer forward-looking
investment solutions, including funds that focus on technology stocks, municipal
bonds, and international securities.
...VALUES ENDURE Seligman is proud of its distinctive past and of the
traditional values that continue to shape the firm's business decisions and
investment judgment. While much has changed over the years, the firm's
commitment to providing prudent investment management that seeks to build wealth
for clients over time is an enduring value that will guide Seligman into the new
millennium.
JAMES, JESSE, AND JOSEPH SELIGMAN, 1870
TABLE OF CONTENTS
To the Shareholders 1
Market and Economic Overview 2
Seligman Henderson International Fund:
Investment Report 3
Performance and Portfolio Overview 5
Portfolio of Investments 8
Seligman Henderson Emerging Markets Growth Fund:
Investment Report 13
Performance and Portfolio Overview 15
Portfolio of Investments 18
Seligman Henderson Global Growth Opportunities Fund:
Investment Report 23
Performance and Portfolio Overview 25
Portfolio of Investments 28
Seligman Henderson Global Smaller Companies Fund:
Investment Report 33
Performance and Portfolio Overview 35
Portfolio of Investments 38
Seligman Henderson Global Technology Fund:
Investment Report 51
Performance and Portfolio Overview 53
Portfolio of Investments 56
Statements of Assets and Liabilities 63
Statements of Operations 64
Statements of Changes in Net Assets 65
Notes to Financial Statements 67
Financial Highlights 75
Report of Independent Auditors 80
Board of Directors 81
Proxy Results 82
Executive Officers AND For More Information 83
Glossary of Financial Terms 84
Benchmarks 85
<PAGE>
TO THE SHAREHOLDERS
We are pleased to provide you with the October 31, 1998, Annual Report for
Seligman Henderson Global Fund Series, Inc., which includes the International
Fund, the Emerging Markets Growth Fund, the Global Growth Opportunities Fund,
the Global Smaller Companies Fund, and the Global Technology Fund. Troubled
markets around the world led to losses for all Seligman Henderson Global Funds
in the six months ended October 31. These losses caused several Funds to end the
fiscal year in negative territory.
While the 1998 fiscal year proved a difficult one for the Funds, the rebound
that started in October continued to gain steam in November and into December.
Some of the hardest hit asset classes this past summer -- technology and
small-company stocks -- recovered the most ground. In turn, the Global
Technology Fund and the Global Smaller Companies Fund, both in negative
territory as the fiscal year ended, posted substantial gains in recent weeks.
The International Fund and the Global Growth Opportunities Fund finished the
year with modest gains, despite losses in the second half of the fiscal year,
and have also posted gains since October. The Emerging Markets Growth Fund,
which had a significant loss for the year, continues to struggle along with
emerging markets in general.
Recent market activity indicates that the magnitude of the global financial
problems has been recognized and authorities are working to find solutions.
Several of the Asian markets first hit by turmoil last year have put stabilizing
policies in place; Japan has taken steps toward bank reform; the International
Monetary Fund, with the backing of the G7, has made a priority of avoiding a
destructive Brazilian devaluation; and interest rates have been lowered in the
US and around the world.
Looking ahead, the combination of lower valuations and positive fiscal action
have increased the attractiveness of stocks and bonds around the world. While
much still needs to be done globally to repair the damage -- especially in the
emerging markets of Asia, Brazil, and Russia -- we believe that significant
longer-term investment opportunities currently exist, and your investment
manager remains committed to the sound principles of long-term investing and
global diversification that have successfully stood the test of time.
Currently, virtually all companies are modifying their computer systems to
recognize dates of January 1, 2000, and beyond. This is often referred to as the
"Y2K" problem. Unless systems are updated, many applications may interpret the
last two digits of the year to mean 1900 instead of 2000. The Seligman
investment teams are well aware of the potential ramifications that the Year
2000 issue may have on companies whose securities are held in investment
portfolios. As part of each Team's investment process, members seek to identify
the preparedness of those firms whose underlying business models leave them
susceptible to Y2K problems. The evaluation of a company's Year 2000 readiness
has become an increasingly important factor which is considered by our
investment teams prior to investing in, disposing of, or continuing to hold, any
security.
In addition to monitoring the potential Y2K impact on our investments, we are
making sure our firm is in order. J. & W. Seligman & Co. Incorporated has
established a team to ensure that your investment and related services are not
disrupted. This team is supported by consulting firms specializing in Y2K
solutions. We are confident that when our plans are finalized and all systems
are tested, there will be no disruption in the services provided by your Fund.
Thank you for your continued support of Seligman Henderson Global Fund Series.
We look forward to serving your investment needs in the many years to come.
By order of the Board of Directors,
/s/WILLIAM C. MORRIS
William C. Morris
Chairman
/s/BRIAN T. ZINO
Brian T. Zino
President
December 4, 1998
1
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MARKET AND ECONOMIC OVERVIEW
OVERVIEW
The year ended October 31, 1998, was marked by volatility and a significant
divergence between the stock markets and economies of the East and the West. In
general, Western stock markets performed well for the year, before falling
sharply in mid-July. By contrast, most Asian stock markets fell throughout the
year before showing recent signs of a tentative recovery. The economic
background has been one of steadily deteriorating conditions as a financial
crisis initially limited to a few Asian countries spread throughout other
regions, culminating in the collapse of the Russian economy. Few countries were
left unscathed.
UNITED STATES
During the economic and market turmoil elsewhere, the US economy continued to
make good progress, although there has been some recent evidence of a slowing.
Corporate profits in the US initially held up well, but expectations declined
steadily throughout the year. For the third quarter of 1998, corporate profits
actually fell. Against this background, bond yields continued to hit new lows,
with the 30-year bond at one point yielding below 5%. The subsequent turmoil in
credit markets has been a major catalyst for the Federal Reserve's three
interest-rate cuts since September.
UNITED KINGDOM
The UK economy has recently begun to contract. The problems in the manufacturing
sector have now appeared in the consumer sector. Growth expectations for this
year and next have been significantly reduced, and corporate profits have come
under increasing pressure. More recently, the Monetary Policy Committee has cut
short-term interest rates, leading to a much needed decline in sterling. In this
negative environment, the UK market has generally underperformed other Western
markets.
CONTINENTAL EUROPE
In general, the performance of Continental European economies has been positive.
In particular, some of the peripheral economies have seen strong growth.
However, there are increasing signs that the problems in Asia are starting to
have a negative impact. Monetary policy has generally been on hold in the core
economies in advance of the introduction of the European Central Bank (ECB).
However, in the peripheral markets, interest rates are converging at the lower
levels of the core economies.
In the early part of 1998, European markets were booming. A favorable economic
background, positive earnings surprises, and abundant liquidity all helped to
generate strong returns. However, stock markets corrected sharply in July and
have since been slow to recover. As elsewhere, European growth expectations for
next year have been declining, but less so compared to other regions.
JAPAN
The economic background in Japan continued to deteriorate throughout the year.
The economy itself is clearly in recession. The government continues to announce
fiscal spending measures, thus far with little impact. During the year, the
financial crisis continued to worsen, with the government having to nationalize
one of the leading banks, although the authorities have promised to provide
enough cash to support the banking system. The Japanese market generally
declined over the period. Recently, however, it has shown signs of stabilizing.
PACIFIC REGION
The situation in the Pacific Region remained dreadful for most of the year, with
recessions in virtually all major economies. Lately, there have been signs that
conditions are at least not getting any worse, and the Chinese economy has
continued to move forward, helping to support the rest of the region.
Considerable problems still remain, but it may be that the worst is now behind
us. In recent months, stock markets have recovered quite strongly, particularly
in Thailand and South Korea. There have also been signs of stabilization in
currency markets.
EMERGING MARKETS (EX-PACIFIC)
In the early part of the year, both Latin America and emerging European markets
held up reasonably well, but as the depth of the Russian crisis became apparent,
most of these markets fell sharply. Growth everywhere is slowing down,
particularly in Latin America.
SUMMARY
Overall, world economic growth has slowed steadily throughout the year and
forecasts for next year suggest growth in the Organization for Economic
Cooperation and Development (OECD) is likely to be the weakest in many years.
This will negatively impact profits at a time when stock market valuations are
still high. It does appear that Western authorities have realized the
seriousness of the situation. There has been a significant lowering of interest
rates almost everywhere in the last three months. However, inflation continues
to decline virtually everywhere and the worry now is that lower inflation may
turn into deflation.
Cuts in interest rates should keep the world economy out of global recession
next year, but there remain considerable risks on the downside. Stock markets
have recovered from their worst position, but confidence remains fragile.
Provided the authorities stay vigilant, stock markets can make some progress
next year, but the route may be challenging. Please note, all stock market
returns quoted in the following Investment Reports are in US dollar terms.
2
<PAGE>
INVESTMENT REPORT
SELIGMAN HENDERSON INTERNATIONAL FUND
PERFORMANCE REVIEW
The year ended October 31, 1998, was characterized by great volatility. In the
first half of the year, international equity markets went from strength to
strength, reaching record highs during the month of July. It then became evident
that the effects of the Asian economic crisis were finally beginning to be felt
around the world, and equities sold off on fears of a global crisis. However,
this setback did not last long, and stock markets around the globe rallied
sharply from their low point on October 5, 1998, as world leaders worked quickly
to avert the crisis and restore confidence by lowering interest rates.
Within this context, the Fund posted a 6.51% total return for the year based on
the net asset value of Class A shares, outpacing the 3.99% total return of its
peer group, as measured by the Lipper International Funds Average. The return of
the Fund's benchmark, the Morgan Stanley Capital International Europe,
Australasia, Far East (MSCI EAFE) Index, was 9.95% for the same period.
PORTFOLIO STRATEGY
UNITED KINGDOM
o The UK followed the fortunes of the rest of world markets over the period,
falling dramatically following July highs, but ending the Fund's fiscal year
on a better note. As in other regions, banks were negatively impacted and
concerns about exposure to emerging market debt arose over the sector as a
whole. There has been a period of earnings downgrades and profit warnings
across the board. Economic data reported in October added to the gloomy
picture, indicating that the UK economy is slowing.
THROUGHOUT THE YEAR, THE FUND MAINTAINED A BENCHMARK-NEUTRAL WEIGHTING IN THE
UK AS WE VIEWED THE UK AS A DEFENSIVE ALTERNATIVE COMPARED TO THE REST OF THE
WORLD. THIS MARKET HAS HELD UP RELATIVELY WELL, CONSIDERING THE TURMOIL AND
VOLATILITY IN WORLD MARKETS. WHILE THE ECONOMY HAS RECENTLY BEGUN TO SLOW,
THERE HAS BEEN A CUT IN INTEREST RATES, WITH FURTHER RATE CUTS EXPECTED. THIS
FITS IN WITH THE PREDICTED "SOFT LANDING" SCENARIO, RATHER THAN A HARSH FALL
INTO RECESSION.
CONTINENTAL EUROPE
o In Continental Europe, markets have fallen from previous highs, but still
ended the year up an impressive 27%. Economic growth for the region, though
dented, should still prove the most resilient in the world. Although
expectations for earnings have been revised lower, the many positive trends
that have made Continental Europe an attractive equity environment are still
intact and should produce strong gains over the next twelve months. European
Monetary Union (EMU) will begin in January 1999 and will result in lower
interest rates and low inflation. In addition, the pace of corporate
restructuring should not slow as companies strive to boost profitability and
shareholder returns.
THE FUND WAS OVERWEIGHTED IN THE CONTINENTAL EUROPEAN EQUITY MARKETS DURING THE
PAST YEAR. LOWER INTEREST RATES, CORPORATE RESTRUCTURING, THE ANTICIPATION OF
[PHOTO OMITTED]
INTERNATIONAL TEAM: (FROM LEFT) JAMES ROBINSON, BEN ELWES, IAIN C. CLARK
(PORTFOLIO MANAGER), DAVID THORNTON, PETER BASSETT, (SEATED) STACEY NAVIN,
KIRSTEEN MORRISON
FUND OBJECTIVE
Seligman Henderson International Fund, which commenced investment operations on
April 7, 1992, seeks long-term capital appreciation by investing primarily in
the stocks of larger-sized companies outside the US.
3
<PAGE>
EMU, AND STRONG FORECASTED EARNINGS GROWTH HELPED TO LIFT STOCK PRICES HIGHER
IN THE FIRST HALF OF 1998, OUTPERFORMING MOST OTHER REGIONAL MARKETS.
DESPITE THE RECENT GLOBAL EQUITY MARKET CORRECTION, THE FUND WILL LIKELY
MAINTAIN ITS REGIONAL OVERWEIGHTING AS WE ANTICIPATE FURTHER STRONG GAINS IN
TELECOMMUNICATIONS, FINANCIALS (ESPECIALLY INSURERS), UTILITIES, AND
RETAILING.
JAPAN
o The Japanese market finished the year down 14.3% in US dollar terms, due
mainly to fears about the economy and the ailing banking system. Economic
data provided supporting evidence that the economy is in fact in a period of
recession. Following the resignation of Prime Minister Hashimoto in July,
there was a period of optimism that the new premier, Mr. Obuchi, would
implement the necessary changes to stimulate the economy and to restructure
the ailing financial system. However, this enthusiasm proved short lived as
the government has failed thus far to deliver any positive policy changes.
THE FUND MAINTAINED A LOW WEIGHTING IN JAPAN THROUGHOUT THE YEAR AS WE DID
NOT ANTICIPATE ANY ECONOMIC RECOVERY IN THE NEAR TERM. WE DO NOT EXPECT A
SPEEDY SOLUTION TO THE BANKING CRISIS NOR SUFFICIENT FISCAL STIMULUS TO BOOST
THE ECONOMY, AND BELIEVE THAT SIGNIFICANT RISKS FOR THE JAPANESE STOCK MARKET
REMAIN. UNTIL CLEARER EVIDENCE THAT THE CONDITION OF THE JAPANESE ECONOMY IS
IMPROVING, WE WILL REMAIN CAUTIOUS.
PACIFIC
o The Pacific Basin ended the year down, with markets across the region
declining 13.7% on average. However, the region had a reversal of fortunes in
the last few months due to the Hong Kong government's decision to intervene
in its stock market, which had the effect of artificially inflating prices.
Other countries such as Malaysia and Indonesia have continued to underperform
dramatically and remain extremely unstable. The protectionism that started in
Malaysia threatens the region with potential isolation. The continuing
recession in Japan is also preventing the region from exporting its way out
of trouble.
SINCE JUNE 1997, THE FUND HAS BEEN SIGNIFICANTLY UNDERWEIGHT IN THE PACIFIC
REGION. THE ECONOMIC CRISIS EXACERBATED THE PRESSURES TO DEVALUE CURRENCIES
THROUGHOUT THE REGION, ULTIMATELY HAVING AN IMPACT ON THE EQUITY MARKETS OF
DEVELOPED COUNTRIES BEGINNING IN JULY 1997. WITH LESS RISKY INVESTMENT
OPPORTUNITIES AVAILABLE IN RELATIVELY MORE STABLE AREAS OF THE WORLD, WE
MAINTAINED A MINIMAL EXPOSURE LEVEL TO PACIFIC MARKETS THROUGHOUT THE PAST
YEAR, AND EXPECT TO REMAIN UNDERWEIGHT IN THE NEAR TERM.
EMERGING MARKETS
o Emerging markets suffered badly from a background of sliding commodity prices
and slowing global economic growth. In addition, Russia's devaluation and
credit default have weighed heavily on investor sentiment. Elsewhere, there
was a loss of confidence in the Brazilian government's ability to solve its
fiscal problems. This led to capital outflows and fear of devaluation. Our
view is that the international assistance package for Brazil should begin to
restore investor confidence, allowing for a recovery. We have, therefore,
decided to maintain a modest exposure to the most established companies in
selected emerging markets where valuations are attractive and at historic
lows.
DURING THE COURSE OF THE YEAR, THE FUND'S HOLDINGS IN EMERGING MARKETS
TYPICALLY RANGED BETWEEN 5% AND 10% OF TOTAL ASSETS. THE FUND'S EXPOSURE WAS
PRIMARILY IN EASTERN/CENTRAL EUROPEAN AND LATIN AMERICAN COUNTRIES.
INVESTMENTS IN EMERGING MARKETS WERE FOCUSED ON HIGHER-QUALITY, MORE LIQUID
NAMES, RATHER THAN LESS LIQUID SMALLER-CAP ISSUES AND INVESTMENTS IN THE
"FRONTIER"COUNTRY MARKETS.
OUTLOOK
The outlook for global stock markets continues to be positive as interest-rate
reductions and efforts to prevent any further spreading of the financial crises
to Latin America have boosted investor sentiment. But despite these
improvements, risks remain and markets must anticipate slower economic and
corporate profit growth. Within this context, we expect that Continental Europe,
the UK, and select emerging markets may offer attractive return potential, as we
believe that corporate earnings growth has the potential to be greatest in these
regions. While we expect the economies of Japan and the Pacific region to remain
depressed over the next few months, we believe both regions could improve
significantly over the longer term.
4
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
SELIGMAN HENDERSON INTERNATIONAL FUND
COUNTRY ALLOCATION
OCTOBER 31, 1998
MSCI
EAFE
FUND INDEX
------- -------
CONTINENTAL EUROPE ....................... 61.03% 50.55%
Austria .............................. -- 0.35
Belgium .............................. -- 1.87
Denmark .............................. 1.34 0.94
Finland .............................. -- 1.16
France ............................... 12.75 9.46
Germany .............................. 7.98 10.45
Greece ............................... 1.34 --
Hungary .............................. 2.14 --
Ireland .............................. 1.41 0.48
Italy ................................ 6.86 4.80
Netherlands .......................... 6.45 5.41
Norway ............................... -- 0.48
Portugal ............................. 1.47 0.74
Spain ................................ 6.81 3.38
Sweden ............................... 3.02 2.76
Switzerland .......................... 9.46 8.27
JAPAN .................................... 8.45 21.53
LATIN AMERICA ............................ 1.28 --
Brazil ............................... 0.33 --
Mexico ............................... 0.95 --
PACIFIC .................................. 1.23 5.94
Australia ............................ 1.14 2.71
Hong Kong ............................ -- 2.36
New Zealand .......................... -- 0.19
Singapore ............................ -- 0.68
South Korea .......................... 0.09 --
UNITED KINGDOM ........................... 20.55 21.98
OTHER ASSETS LESS LIABILITIES ............ 7.46 --
--------- ---------
TOTAL 100.00% 100.00%
========= =========
LARGEST INDUSTRIES
OCTOBER 31, 1998
[The following represents a bar chart in the original]
BANKING 12.6 $11,533,271
TELECOMMUNICATIONS 11.5 10,486,347
RETAILING 8.7 7,926,082
INSURANCE 7.5 6,891,915
CONSUMER PRODUCTS 7.5 6,872,722
REGIONAL ALLOCATION
OCTOBER 31, 1998
[The following represents a pie chart in the original]
Continental Europe .............. 61.03%
United Kingdom .................. 20.55%
Japan ........................... 8.45%
Latin America ................... 1.28%
Pacific ......................... 1.23%
Other Assets Less Liabilities ... 7.46%
LARGEST PORTFOLIO HOLDINGS
OCTOBER 31, 1998
SECURITY VALUE
- ---------- --------------
Magyar Tavkozlesi "Matav"
(ADRs) (Hungary) ................... $1,956,500
Vivendi (France) ...................... 1,837,397
Novartis (Switzerland) ................ 1,735,248
Railtrack Group
(United Kingdom) ................... 1,713,150
Zurich Allied (Switzerland) ........... 1,712,629
Lafarge (France) ...................... 1,662,229
Roche Holding (Switzerland) ........... 1,636,942
Benckiser (Series B) (Netherlands) .... 1,636,255
AXA-UAP (France) ...................... 1,619,239
Nestle (Switzerland) .................. 1,562,229
5
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
SELIGMAN HENDERSON INTERNATIONAL FUND
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS
FOR PERIODS ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION>
AVERAGE ANNUAL
--------------------------------------------------------------------------
CLASS A CLASS B CLASS D
SINCE SINCE SINCE
SIX One Five INCEPTION INCEPTION INCEPTION
MONTHS* Year Years 4/7/92 4/22/96 9/21/93
--------- ------- ------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A**
With Sales Charge (15.15)% 1.46% 6.12% 9.34% n/a n/a
Without Sales Charge (10.94) 6.51 7.16 10.15 n/a n/a
CLASS B**
With CDSC+ (15.75) 0.62 n/a n/a 3.00% n/a
Without CDSC (11.32) 5.51 n/a n/a 4.10 n/a
CLASS D**
With 1% CDSC (12.20) 4.53 n/a n/a n/a n/a
Without CDSC (11.32) 5.51 6.29 n/a n/a 7.12%
LIPPER INTERNATIONAL
FUNDS AVERAGE*** (10.47) 3.99 7.02 10.11++ 5.440 7.8400
MSCI EAFE INDEX*** (4.88) 9.95 7.11 10.36+++ 4.910 7.6400
</TABLE>
<TABLE>
<CAPTION>
NET ASSET VALUE
OCTOBER 31, 1998 APRIL 30, 1998 OCTOBER 31, 1997
------------------ --------------- ------------------
<S> <C> <C> <C>
CLASS A $17.75 $19.93 $17.92
CLASS B 16.93 19.09 17.30
CLASS D 16.93 19.09 17.30
</TABLE>
CAPITAL GAIN INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1998
PAID $1.222
REALIZED 0.316
UNREALIZED 2.764000
Performance data quoted represent changes in prices and assume that all
distributions within the periods are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or lessthan their original cost.
- ----------------------------------------------------------------------------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price and assume the investment of
dividends and capital gain distributions. Returns for Class A shares are
calculated with and without the effect of the initial 4.75% maximum sales
charge. Returns for Class A shares also reflect the effect of the service
fee of up to 0.25% under the Administration, Shareholder Services and
Distribution Plan after September 21, 1993, only. Returns for Class B
shares are calculated with and without the effect of the maximum 5%
contingent deferred sales charge ("CDSC"), charged on redemptions made
within one year of the date of purchase, declining to 1% in the sixth year
and 0% thereafter. Returns for Class D shares are calculated with and
without the effect of the 1% CDSC, charged on redemptions made within one
year of the date of purchase.
*** The Lipper International Funds Average and the Morgan Stanley Capital
International EAFE (Europe, Australasia, Far East) Index (MSCI EAFE Index)
are unmanaged benchmarks that assume reinvestment of dividends. The Lipper
International Funds Average excludes the effect of sales charges and the
MSCI EAFE Index excludes the effect of fees and sales charges. The monthly
performance of the Lipper International Funds Average is used in the
Performance and Portfolio Overview. Investors cannot invest directly in an
average or an index.
+ The CDSC is 5% for periods of one year or less, and 3% since inception.
++ From April 9, 1992.
+++ From March 31, 1992.
0 From April 30, 1996.
00 From September 30, 1993.
000 Represents the per share amount of net unrealized appreciation of portfolio
securities as of October 31, 1998.
6
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
SELIGMAN HENDERSON INTERNATIONAL FUND
This chart compares a $10,000 hypothetical investment made in Seligman
Henderson International Fund Class A shares, with and without the initial 4.75%
maximum sales charge, and assumes that all distributions within the period are
invested in additional shares, since the commencement of investment operations
on April 7, 1992, through October 31, 1998, to a $10,000 hypothetical investment
made in the Lipper International Funds Average and the Morgan Stanley Capital
International EAFE (Europe, Australasia, Far East) Index (MSCI EAFE Index) for
the same period. It is important to keep in mind that indices and averages
exclude the effect of fees and/or sales charges.
Class Class
A A Lipper
With Without MSCI Intl
Sales Sales EAF Fds
Load Load Index Avg.
----- ----- ----- -----
4/7/92 9524 10000 10000 10000
4/30/92 9635 10117 10050 10483
3/31/92 9524 10000 10000 10000
4/30/92 9635 10117 10050 10483
7/31/92 9444 9917 9962 10328
10/31/92 9437 9908 9843 9875
1/31/93 9662 10145 9995 10099
4/30/93 11270 11833 12267 11459
7/31/93 11445 12017 12771 11826
10/31/93 12718 13354 13572 12995
1/31/94 14012 14712 14412 14473
4/30/94 13646 14329 14346 13874
7/31/94 13971 14670 14613 14063
10/31/94 14353 15071 14980 14388
1/31/95 12724 13361 13808 12890
4/30/95 13530 14207 15189 13765
7/31/95 14438 15160 15675 14632
10/31/95 14175 14884 14970 14286
1/31/96 15146 15903 16084 15205
4/30/96 15916 16712 16973 16025
7/31/96 15173 15932 16277 15506
10/31/96 15370 16138 16588 15929
1/31/97 15845 16637 16442 16635
4/30/97 16278 17092 16873 16952
7/31/97 18605 19535 19281 19325
10/31/97 16881 17725 17403 17593
1/31/98 17331 18197 18183 17996
4/30/98 20187 21196 20110 20444
7/31/98 20785 21824 20381 20608
10/31/98 17979 18878 19128 18299
There are specific risks associated with global investing, such as currency
fluctuations, foreign taxation, differences in financial reporting practices,
and rapid changes in political and economic conditions.
As shown on page 6, the performances of Class B and D shares will be greater
than or less than the performance shown for Class A shares, based on the
differences in sales charges and fees paid by shareholders. Past performance is
not indicative of future investment results.
LARGEST PORTFOLIO CHANGES
During the Six Months Ended October 31, 1998
Shares
----------------------------
HOLdings
Additions Increase 10/31/98
- ----------- ----------- -----------
Castorama Dubois
Investissements (France) 6,000 6,000
Corporacion Bancaria
de Espana (Spain) 60,570 60,570
DaimlerChrysler (Germany) 14,494 14,494
Lloyds TSB Group
(United Kingdom) 71,000 71,000
Nestle (Switzerland) 523 733
Roche Holding
(Switzerland) 140 140
RWE (Germany) 24,583 24,583
Suez Lyonnaise
des Eaux (France) 7,272 7,272
Total (France) 10,965 10,965
Unilever (Netherlands) 17,330 17,330
Shares
----------------------------
Holdings
REDUCTIONS Decrease 10/31/98
- ------------- ----------- -----------
Akzo Nobel
(Netherlands) 22,372(1) --
Astra (Class A) (Sweden) 66,829 --
Banco Bilbao Vizcaya
(Spain) 83,133(2) --
Bayer (Germany) 25,418 --
Carrefour Supermarche
(France) 1,924 --
Credit Communal Holding/
Dexia (Belgium) 7,245 --
CS Holdings (Switzerland) 8,503 --
Lufthansa (Germany) 56,466 --
Mol Magyar Olaj-es Gazipari
(GDRs) (Hungary) 58,600 --
Petroleo Brasileiro
"Petrobras" (ADRs) (Brazil) 55,770 --
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
- --------------------------------------------------------------------------------
(1) Includes 16,779 shares received as a result of a 4-for-1 stock split.
(2) Includes 55,422 shares received as a result of a 3-for-1 stock split.
7
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson International Fund
SHARES VALUE
------ -----
COMMON STOCKS 92.26%
AUSTRALIA 1.14%
COLONIAL
Provider of financial services in
banking, retail insurance, and
investments (Financial Services) 68,000 $ 549,970
RIO TINTO
International mining company
(Metals) 4,000 50,002
TELSTRA
Provider of telecommunication
services (Telecommunications) 25,500 72,537
WESTPAC BANKING
Provider of banking services
(Banking) 60,700 368,837
-----------
1,041,346
-----------
BRAZIL 0.33%
TELECOMUNICACOES BRASILEIRAS
"TELEBRAS" (ADRS)
Provider of telecommunication
services (Telecommunications) 4,000 303,750
-----------
DENMARK 1.34%
TELE DANMARK
Provider of telecommunication
services and equipment
(Telecommunications) 11,228 1,224,081
-----------
FRANCE 12.75%
ACCOR
Hotel operator and provider
of related services
(Entertainment and Leisure) 5,029 1,057,830
AXA-UAP
Provider of insurance and
financial services (Insurance) 14,305 1,619,239
CASTORAMA DUBOIS INVESTISSEMENTS
Operator of do-it-yourself
retail stores (Retailing) 6,000 1,071,738
ELF AQUITAINE
Oil and gas exploration;
manufacturer of chemical
compounds (Resources) 11,990 1,389,612
ETAM DEVELOPPEMENT
Retailer of women's clothing
and intimate apparel (Retailing) 8,869 447,606
LAFARGE
Producer and seller of
building materials
(Construction and Property) 16,236 $ 1,662,229
SUEZ LYONNAISE DES EAUX
Financial group which supports
the communication, electric,
waste management, and
water industries (Construction
and Property) 7,272 1,304,189
TOTAL
Worldwide operator of gas
and oil (Resources) 10,965 1,266,865
VIVENDI
Water purification and
distribution; energy production
(Industrial Goods and Services) 8,033 1,837,397
-----------
11,656,705
-----------
GERMANY 7.98%
ADIDAS-SALOMON
Manufacturer and marketer of
sporting goods (Retailing) 8,695 1,056,648
BAYERISCHE HYPO-UND VEREINSBANK
Provider of universal banking
services (Banking) 17,331 1,383,127
DAIMLERCHRYSLER*
International designer,
manufacturer, and marketer
of luxury automobiles, trucks,
and other vehicles; provider of
telecommunication, aerospace,
and financial services
(Automotive and Related) 14,494 1,140,942
MANNESMANN
Plant and machinery
construction; automotive
technology (Industrial Goods
and Services) 15,332 1,486,852
RWE
Worldwide operator of services
in the chemicals, construction
and civil engineering, energy,
mechanical and plant engineering,
mining, petroleum, raw materials,
and waste disposal sectors
(Resources) 24,583 1,322,785
8
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson International Fund
SHARES VALUE
------ -----
SIEMENS
International provider of
automotive and computer
products (Manufacturing) 14,904 $ 906,495
----------
7,296,849
----------
GREECE 1.34%
HELLENIC TELECOMMUNICATION
ORGANIZATION
Provider of telecommunication
services (Telecommunications) 24,500 557,372
NATIONAL BANK OF GREECE (GDRS)+
Provider of banking and
financial services (Banking) 23,780 671,785
----------
1,229,157
----------
HUNGARY 2.14%
MAGYAR TAVKOZLESI "MATAV" (ADRS)
Provider of telecommunication
services (Telecommunications) 72,800 1,956,500
----------
IRELAND 1.41%
BANK OF IRELAND
Provider of banking
services (Banking) 70,000 1,289,766
----------
ITALY 6.86%
BANCA POPOLARE DI BRESCI
Provider of commercial banking
and financial services (Banking) 52,578 1,239,774
ENI
Refiner and marketer of oil
and gas (Resources) 195,910 1,166,843
ISTITUTO NAZIONALE DELLE
ASSICURAZIONI
Provider of life and non-life
insurance products (Insurance) 566,314 1,561,947
TELECOM ITALIA
PROVIDER OF TELECOMMUNICATION
services (Telecommunications) 289,001 1,458,246
UNICREDITO ITALIANO
Provider of banking services
(Banking) 156,950 843,714
----------
6,270,524
----------
SHARES VALUE
------ -----
JAPAN 8.17%
BENESSE
Provider of educational
services (Business Services) 4,300 $ 197,765
BRIDGESTONE
Retailer of automobile
tires (Automotive and Related) 14,000 308,704
CANON
Manufacturer of printers and
photocopiers (Business Services) 15,000 284,333
CREDIT SAISON
Provider of
financial services
(Financial Services) 12,000 283,172
DENNY'S JAPAN
Restaurant operator (Restaurants) 6,000 138,491
EAST JAPAN RAILWAY
Provider of railway services
(Transportation) 61 362,355
FUJI MACHINE MANUFACTURING
Manufacturer of assembly
machines and chips for the
electronic industry
(Industrial Goods and
Services) 10,000 294,864
FUJITSU SUPPORT AND SERVICE
Electronic and communication
equipment dealer
(Business Services) 8,000 402,321
HONDA MOTOR
International operator of
motorcycles, automobiles, and
power products (Automotive and Related) 10,000 300,881
JAPAN TOBACCO
Tobacco producer (Tobacco) 38 319,158
KAO
Manufacturer of cosmetics
and personal care products
(Consumer Products) 22,000 446,336
KAWASAKI HEAVY INDUSTRIES
Producer of transport
equipment and heavy
machinery for the military
(Industrial Goods and Services) 111,000 243,327
MITSUBISHI GAS CHEMICAL
Chemical producer
(Chemicals) 112,000 293,660
- -------------------------
See footnotes on page 12.
9
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson International Fund
JAPAN (continued)
SHARES VALUE
------ -----
MITSUI
Trading company active in
the chemical, food, gas, metals,
steel, and textiles industries
(Industrial Goods and Services) 39,000 $ 208,536
MITSUI CHEMICALS
Producer of petrochemical
products (Chemicals) 84,000 261,406
MITSUI FUDOSAN
Provider of real estate, and
operator of fitness centers
and leisure facilities
(Construction and Property) 36,000 239,536
NEC
Manufacturer and marketer
of computers and
telecommunication devices
(Consumer Products) 48,000 356,106
NIPPON TELEGRAPH & TELEPHONE
Provider of telecommunication
services (Telecommunications) 3,900 305,764
NTT DATA
Provider of data communication
and system development services
(Telecommunications) 64 271,240
NTT Mobile Communication Network
"NTTDoCoMo"
Provider of telecommunication
services (Telecommunications) 1,100 398,109
ROHM
Producer of custom linear
integrated circuits (Electronics) 2,000 177,090
SECOM
Security services pioneer
(Retailing) 3,000 223,082
SHOHKOH FUND
Provider of loans to small-
and mid-sized companies
(Financial Services) 1,100 335,225
SONY
Developer and manufacturer of
audio and video equipment
(Consumer Products) 4,800 305,351
TAKEFUJI
Provider of consumer financial
services (Financial Services) 6,000 $ 320,309
YORK-BENIMARU
Supermarket chain operator
(Retailing) 6,600 190,638
-----------
7,467,759
-----------
MEXICO 0.95%
FOMENTO ECONOMICO MEXICANO
(ADRS)
Beverage and packaging
producer; retail store operator
(Consumer Products) 21,000 547,313
GRUPO TELEVISA (GDRS)*
Provider of television and
other media services
(Entertainment and Leisure) 11,700 317,363
-----------
864,676
-----------
NETHERLANDS 6.45%
BENCKISER (SERIES B)
Producer and supplier of
household cleaning products
(Consumer Products) 28,833 1,636,255
ING Groep
Worldwide underwriter of
reinsurance; provider of
financial and consumer
credit (Insurance) 23,539 1,140,306
KONINKLIJKE AHOLD
Distributor and marketer of
food products (Retailing) 31,894 1,061,367
KONINKLIJKE (ROYAL) PHILIPS
ELECTRONICS
Consumer and industrial
electronics (Electronics) 14,486 771,614
UNILEVER
International manufacturer of
personal care products
(Consumer Products) 17,330 1,287,143
-----------
5,896,685
-----------
PORTUGAL 1.47%
BANCO PORTUGUES DO ATLANTICO*
Commercial bank services
provider (Banking) 2,671 53,309
- -------------------------
See footnotes on page 12.
10
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson International Fund
PORTUGAL (continued)
SHARES VALUE
------ -----
ELECTRICIDADE DE PORTUGAL
Generator and distributor
of electricity (Utilities) 51,688 $ 1,293,980
-----------
1,347,289
-----------
SOUTH KOREA 0.09%
SAMSUNG ELECTRONICS
Manufacturer of consumer
and industrial electronics and
semiconductors (Electronics) 2,014 82,422
-----------
SPAIN 6.81%
ACTIVIDADES DE CONSTRUCCION
Y SERVICIOS
Designer and builder of public
works projects, residential
homes, and other buildings
(Construction and Property) 37,174 1,188,373
CENTROS COMERCIALES
CONTINENTE
Hypermarket chain selling
groceries, kitchen appliances,
auto accessories, and clothing
(Retailing) 38,203 1,141,118
CORPORACION BANCARIA DE ESPANA
Provider of commercial
banking services in
Europe (Banking) 60,570 1,320,298
ENDESA
Producer, transmitter, and
distributor of electricity
to other utilities
(Utilities) 40,589 1,024,756
TELEFONICA DE ESPANA
Provider of telecommunication
services (Telecommunications) 34,295 1,551,214
-----------
6,225,759
-----------
SWEDEN 3.02%
L.M. ERICSSON TELEFON (SERIES B)
Manufacturer of
telecommunication equip-
ment (Telecommunications) 59,795 1,350,173
NORDBANKEN HOLDING
Provider of banking, financial,
loan, and insurance services
(Banking) 234,937 1,410,617
-----------
2,760,790
-----------
SWITZERLAND 9.46%
NESTLE
Producer of consumer packaged
goods (Consumer Products) 733 $ 1,562,229
NOVARTIS
Manufacturer of pharmaceuticals
(Health and Household) 961 1,735,248
ROCHE HOLDING
Pharmaceutical
company and chemical
producer (Health and Household) 140 1,636,942
SWISSCOM*
Provider of telecommunication
networks and services
(Telecommunications) 3,054 1,037,361
UBS
Global provider of institutional
asset management and private
banking services (Banking) 3,530 970,469
ZURICH ALLIED
Holding company active in
life insurance and asset
management (Insurance) 2,812 1,712,629
-----------
8,654,878
-----------
UNITED KINGDOM 20.55%
ALLIED ZURICH*
Holding company active in life
insurance and asset management
(Insurance) 72,500 857,794
BBA GROUP
International manufacturer of
textiles and aviation
equipment (Diversified) 80,000 494,687
BOOTS
Retailer of pharmaceuticals
and beauty products
(Retailing) 50,000 754,749
BRITISH AMERICAN TOBACCO
Producer and marketer of
tobacco products (Tobacco) 72,500 647,289
BRITISH PETROLEUM
Oil producer, refiner, and
distributor (Resources) 90,734 1,338,499
- -------------------------
See footnotes on page 12.
11
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson International Fund
SHARES VALUE
------ -----
UNITED KINGDOM (CONTINUED)
BRITISH VITA
Holding company for worldwide
companies which manufacture
fabrics for the furnishing,
transportation, clothing,
packaging, and engineering
industries (Chemicals) 170,000 $ 674,253
BUNZL
Distributor and manufacturer of
paper and plastic products
(Manufacturing) 225,000 1,039,244
GRANADA GROUP
Television group with additional
leisure interests, including
hotels (Entertainment and
Leisure) 94,000 1,430,725
KINGFISHER
Producer and retailer of consumer
goods and merchandise (Retailing) 87,400 762,035
LLOYDS TSB GROUP
Provider of banking and financial
services (Banking) 71,000 878,069
MERSEY DOCKS & HARBOUR
Operator of facilities on the
Mersey River (Transportation) 90,000 670,237
NATIONAL POWER
Electric power generation
(Utilities) 110,000 953,560
RAILTRACK GROUP
Provider of rail services
(Transportation) 64,101 1,713,150
ROLLS ROYCE
Aerospace; power generation,
transmission, and distribution
systems (Industrial Goods and
Services) 170,600 633,808
ROYAL BANK OF SCOTLAND
Provider of banking services
(Banking) 84,000 1,103,506
UNITED KINGDOM (continued)
SCOTTISH & NEWCASTLE
Brewery operator (Consumer
Products) 60,000 shs.$ 731,989
SMITHKLINE BEECHAM
Manufacturer and marketer of
pharmaceutical products; provider
of health care products and
services (Health and Household) 50,000 616,266
TESCO
Supermarket chain (Retailing) 445,500 1,217,101
UNITED UTILITIES
Provider of water utility
services (Utilities) 90,000 1,315,622
WPP GROUP
Provider of worldwide marketing
services, including advertising,
public relations, and market
research (Media) 195,500 958,606
--------------
18,791,189
--------------
TOTAL COMMON STOCKS
(Cost $69,802,205) 84,360,125
CONVERTIBLE BONDS 0.28%
(Cost $221,126)
JAPAN 0.28%
SANWA INTERNATIONAL
11 1/4%, 7/31/2005
(Financial Services) 39,000,000** 258,994
--------------
TOTAL INVESTMENTS 92.54%
(Cost $70,023,331) 84,619,119
OTHER ASSETS
LESS LIABILITIES 7.46% 6,822,213
--------------
NET ASSETS 100.00% $91,441,332
==============
- -------------------------
* Non-income producing security.
** Principal amount reported in Japanese yen.
+ Rule 144A security.
Descriptions of companies have not been audited by Deloitte &Touche LLP.
See Notes to Financial Statements.
12
<PAGE>
INVESTMENT REPORT
Seligman Henderson Emerging Markets Growth Fund
PERFORMANCE REVIEW
Emerging markets suffered from the effects of a series of currency crises and
associated global contagion. Over the year as a whole, the Fund had a total
return of -29.43% based on the net asset value of Class A shares. This compares
to a -30.98% total return posted by the Morgan Stanley Capital International
Emerging Markets Free Index and to the -31.48% total return posted by the Lipper
Emerging Markets Funds Average.
Fund management was more challenging than usual. The strategy consisted of
trying to avoid investments in markets with weak currencies, while increasing
cash levels during periods of global uncertainty, particularly in November -
December 1997, and August - September 1998. High levels of cash held during the
attack on the Brazilian real were reinvested in the markets in October after
confidence was, to some extent, restored through US interest-rate cuts, the
strengthening of the yen, and supportive statements from the leadership of the
G7 group of industrialized countries.
PORTFOLIO STRATEGY
In regional terms, there were a number of significant trends. The Fund's
overweight position in Emerging Europe was maintained throughout the year,
although exposure to Russia was greatly reduced. Exposure to Far Eastern markets
was increased over the year, but exposure to Latin America was reduced largely
due to economic uncertainty in Brazil.
PACIFIC REGION
o The devaluation of the Thai baht in July 1997 greatly affected the markets of
the South Pacific region (Thailand, the Philippines, Malaysia, and
Indonesia). Sentiment in the markets remained weak during the latter months
of 1997 as currency instability moved to North Pacific markets. The
Indonesian currency came under attack in January 1998. There was a brief
rally in currencies and markets in the first quarter of 1998, but the
Malaysian government was forced to introduce currency controls in September.
Other than in the Malaysian ringit, there was a rally in currencies toward
the end of the Fund's year. Market performances ranged between a fall of 8.7%
in the Philippine index to a fall of 76.8% in the Indonesian index.
THE FUND RETAINED HOLDINGS IN THAILAND AND THE PHILIPPINES THROUGHOUT THE
PERIOD. A SMALL NUMBER OF HOLDINGS WERE HELD IN MALAYSIA DURING THE FIRST
QUARTER OF THE YEAR BUT THESE WERE SOLD BEFORE THE IMPOSITION OF CURRENCY
CONTROLS. TOWARD THE END OF THE FUND'S YEAR, THE FUND ESTABLISHED HOLDINGS IN
Thai Farmers Bank AND Bangkok Bank AS THE OUTLOOK FOR THAILAND IMPROVED.
o In the North Pacific region, the direction of the markets was dictated by
currency moves. The attack on the Hong Kong dollar in November 1997 was
followed by the South Korean currency crisis later in December. The Taiwanese
market, following the effective floating of the currency in October, remained
relatively untouched by the crisis. The Taiwanese index fell 14.9%, the South
Korean index fell 24.5%, and the China (non-domestic) index fell 52.8%.
THE FUND HELD FEW POSITIONS IN THE REGION UNTIL SEPTEMBER, WHEN THERE WERE
SIGNIFICANT ADDITIONS TO THE PORTFOLIO. IN CHINA, THE PORTFOLIO REMAINS
FOCUSED ON INFRASTRUCTURE. WE HAVE PURCHASED China Telecom, Cheung Kong
Infrastructure, AND China Resources Enterprise. IN SOUTH KOREA, WE SOLD OUR
HOLDING IN Samsung Electronics AND PURCHASED SK Telecom Group AND Korea
Electric Power. IN TAIWAN, OUR HOLDINGS REMAINED FOCUSED ON BROADLY BASED
CLOSED-END FUNDS.
INTERNATIONAL TEAM: MONICA BALL, PETER BASSETT (PORTFOLIO MANAGER), ELEANOR
DALE, CHRISTOPHER EDWARDS, DIVYA MATHUR, KIRSTEEN MORRISON, LOUISE O'SULLIVAN,
SHEILA SPARKS (ADMINISTRATIVE ASSISTANT)
FUND OBJECTIVE
Seligman Henderson Emerging Markets Growth Fund, which commenced operations on
May 28, 1996, seeks long-term capital appreciation by investing primarily in
equity securities of emerging markets around the world.
13
<PAGE>
INVESTMENT REPORT
Seligman Henderson Emerging Markets Growth Fund
LATIN AMERICA
o Latin American markets remained volatile with attacks on the Brazilian real
in November - December 1997, and September 1998. However, both the Brazilian
real and Argentine peso were successfully defended. The region's markets
rebounded after the mid-September promise of G7 and IMF support for the
defense of the real. Throughout the year, the Mexican currency also suffered
periods of instability, and domestic interest rates were put up in its
defense. The performances for the indices of the major markets were as
follows: Argentina fell 12.1%, Mexico fell 21.0%, and Brazil fell 34.1%.
OUR CORE EXPOSURE IN LATIN AMERICA REMAINS MEXICO, WHERE THE DEFENSIVELY
POSITIONED HOLDINGS FOCUS ON BREWERIES (Femsa), BOTTLERS (Pepsi-Gemex AND
Panamerican Beverages), AND TELECOMMUNICATIONS (Telemex AND Grupo Iusacell).
HOLDINGS IN BRAZIL AND ARGENTINA WERE ADJUSTED FOR THE OUTLOOK FOR THEIR
CURRENCIES. IN PARTICULAR, WE SOLD BRAZILIAN COMPANIES WITH US DOLLAR
EXPOSURE SUCH AS CEMIG AND Sabesp. HOWEVER, WE RETAINED OUR CORE HOLDINGS OF
Telebras AND Petrobras.
EMERGING EUROPE
o The Emerging European region produced significantly diverse performances,
largely dependent on the currency and interest-rate events for the year.
Greece, which joined the European monetary system during the year in
preparation to joining European Monetary Union (EMU), benefited from currency
stability and falling interest rates. The Greek market rose 33.8%. Portugal,
which joins EMU on January 1, 1999, experienced similar beneficial effects,
rising 35.4%.
By contrast, the Russian market was hit by a severe internal budget deficit
which led to the collapse of the rouble and the replacement of a reformist
government with a government led by former communists. The Russian index fell
by 85.2%. The overall negative sentiment toward emerging markets caused other
emerging European markets to suffer in varying degrees. Hungary fell 7.5%,
the Czech Republic fell 10.2%, and Poland fell 16.2%. Turkey, affected by
high interest rates and political uncertainty, fell 50.7%.
THE KEY PORTFOLIO MOVE IN THE REGION WAS AN INCREASE TO THE GREEK WEIGHTING
THROUGH THE PURCHASE OF Alpha Credit Bank, Hellenic Telecommunication (OTE),
AND Sarantis. MOST HOLDINGS IN RUSSIA WERE SOLD FOLLOWING THE MARKED
DETERIORATION OF THE ECONOMIC AND POLITICAL OUTLOOK AND THE REMAINDER WERE
SOLD AFTER THE FUND'S YEAR END. ALL HOLDINGS IN PORTUGAL WILL BE SOLD BEFORE
THE COUNTRY JOINS EMU. OF NOTE DURING THE YEAR WAS THE INCREASED WEIGHTING OF
THE FUND INTO BOTH POLAND AND HUNGARY WITH THE PURCHASE OF Elektrim, Matav,
Powszechny Bank, AND Prokom Software, AND THE RE-ENTRY INTO THE CZECH
REPUBLIC WITH THE PURCHASE OF Ceske Radiokomunikace.
OTHER MARKETS
o Other markets in which the Fund has been invested were affected by the
general pressures on emerging markets. The Indian market fell 34.2% and the
South African market fell 25.4%. Within the markets of the Middle East and
North Africa, the Israeli (domestic) index fell 18.7% and the Egyptian index
fell 37.4%.
WE MAINTAINED LOW WEIGHTINGS IN INDIA DURING THE PERIOD, FOCUSING ON THE
SECULAR GROWTH STOCKS OF Mahangar Telephone Nigam (THE BOMBAY AND DELHI
TELEPHONE SYSTEM) AND THE Indian Tobacco Company (ITC). THE SOUTH AFRICAN
WEIGHTING WAS REDUCED BEFORE THE WEAKNESS IN SEPTEMBER BUT INCREASED IN
OCTOBER WHEN INTEREST RATES BEGAN TO EASE, WITH PURCHASES OF Nedcor (A BANK)
AND Pepkor (A RETAILER). OUR ISRAELI EXPOSURE WAS SWITCHED FROM TECHNOLOGY
SECTOR HOLDINGS TO Bank Hapoalim AND Blue Square (A SUPERMARKET). WITHIN THE
EGYPTIAN PORTFOLIO, WE ADDED Al-ahram Beverages (A BREWERY AND BOTTLING
COMPANY).
OUTLOOK
Following the supportive statements of the leaders of the G7 and recent policy
actions of the US and Japan on various issues, the outlook for emerging markets
is more optimistic. Moreover, there are positive developments in each of the
major regions within the Pacific, with trade surpluses likely to boost liquidity
in domestic markets and provide some stability to the currencies. In Emerging
Europe, convergence and integration is likely to continue to positively affect
Greek and Central European markets. Although economic growth will be lackluster,
Latin America is likely to benefit from lower real interest rates. Overall, the
emerging markets are likely to show some recovery in the year ahead; although
market performance will differ widely and progress is likely to be volatile.
14
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Emerging Markets Growth Fund
COUNTRY ALLOCATION
OCTOBER 31, 1998
MSCI
EMF
FUND INDEX
------- -------
CENTRAL/SOUTHERN EUROPE 29.56% 12.12%
Czech Republic 1.68 1.17
Estonia 0.38 --
Greece 7.56 5.47
Hungary 6.46 1.40
Poland 4.15 0.98
Portugal 6.80 --
Russia -- 1.24
Turkey 2.53 1.86
INDIAN SUBCONTINENT/AFRICA 18.64 24.03
Egypt 3.53 --
India 4.03 7.58
Israel 2.26 3.15
Jordan -- 0.18
Lebanon 1.23 --
Pakistan -- 0.36
South Africa 7.59 12.69
Sri Lanka -- 0.07
LATIN AMERICA 27.22 36.55
Argentina 4.82 5.26
Brazil 7.78 12.80
Chile 1.35 4.40
Columbia -- 0.56
Mexico 13.27 11.75
Peru -- 0.98
Venezuela -- 0.80
PACIFIC 18.88 27.30
China 4.80 0.76
Indonesia -- 1.15
Malaysia -- 3.65
Philippines 3.21 1.93
South Korea 2.68 6.63
Taiwan 3.64 10.67
Thailand 4.55 2.51
OTHER ASSETS LESS LIABILITIES 5.70 --
------ ------
TOTAL 100.00% 100.00%
====== ======
LARGEST INDUSTRIES
OCTOBER 31, 1998
[The table below represents a bar chart]
Percent of
Net Assets
----------
TELECOMMUNICATIONS 21.4% $11,542,415
FINANCIAL SERVICES 17.8% $9,589,521
RESOURCES 11.8% $6,378,038
RETAILING 11.1% $5,983,517
CONSUMER GOODS AND SERVICES 8.3% $4,467,970
REGIONAL ALLOCATION
OCTOBER 31, 1998
[The table below represents a pie chart]
Central/Southern Europe 29.56%
Latin America 27.22%
Pacific 18.88%
Indian Subcontinent/Africa 18.64%
Other Assets Less Liabilities 5.70%
LARGEST PORTFOLIO HOLDINGS
OCTOBER 31, 1998
SECURITY VALUE
- ---------- ------------
Telecel-Comunicacaoes Pessoais
(Portugal) $1,660,356
Magyar Tavkozlesi "Matav" (ADRs)
(Hungary) 1,478,125
Fomento Economico Mexicano "Femsa"
(ADRs) (Mexico) 1,433,437
Jeronimo Martins (Portugal) 1,347,367
Korea Electric Power (South Korea) 1,175,445
Kimberly-Clark de Mexico
(ADRs) (Mexico) 1,074,315
YPF Sociedad Anonima (ADRs)
(Argentina) 1,070,688
Petroleo Brasileiro "Petrobras"
(Brazil) 1,019,365
Panamerican Beverages
(Class A) (Mexico) 1,014,525
National Bank of Greece
(GDRs) (Greece) 1,003,440
15
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Emerging Markets Growth Fund
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS
FOR PERIODS ENDED OCTOBER 31, 1998
AVERAGE ANNUAL
--------------------
SINCE
SIX ONE INCEPTION
MONTHS* YEAR 5/28/96
------- ------- ---------
CLASS A**
With Sales Charge (37.96)% (32.81)% (14.14)%
Without Sales Charge (34.84) (29.43) (12.39)
CLASS B**
With CDSC+ (38.32) (33.49) (14.10)
Without CDSC (35.08) (29.99) (13.02)
CLASS D**
With 1% CDSC (35.64) (30.69) n/a
Without CDSC (34.99) (29.99) (13.02)
LIPPER EMERGING MARKETS
FUNDS AVERAGE*** (34.11) (31.48) (14.67)++
MSCI EMF INDEX*** (33.41) (30.98) (19.25)+++
NET ASSET VALUE
OCTOBER 31, 1998 APRIL 30, 1998 OCTOBER 31, 1997
------------------ -------------- ----------------
CLASS A $5.18 $7.95 $7.34
CLASS B 5.09 7.84 7.27
CLASS D 5.09 7.83 7.27
CAPITAL LOSS INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1998
REALIZED $(1.831)
UNREALIZED (0.465)0
Performance data quoted represent changes in prices and assume that all
distributions within the periods are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or less than their original cost.
- -----------------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price and assume the investment of
dividends and capital gain distributions. Returns for Class A shares are
calculated with and without the effect of the initial 4.75% maximum sales
charge. Returns for Class B shares are calculated with and without the
effect of the maximum 5% contingent deferred sales charge ("CDSC"), charged
on redemptions made within one year of the date of purchase, declining to 1%
in the sixth year and 0% thereafter. Returns for Class D shares are
calculated with and without the effect of the 1% CDSC, charged on
redemptions made within one year of the date of purchase.
*** The Lipper Emerging Markets Funds Average and the Morgan Stanley Capital
International Emerging Markets Free Index (MSCI EMF Index) are unmanaged
benchmarks that assume reinvestment of dividends. The Lipper Emerging
Markets Funds Average excludes the effect of sales charges and the MSCI EMF
Index excludes the effect of fees and sales charges. The monthly performance
of the Lipper Emerging Markets Funds Average is used in the Performance and
Portfolio Overview. Investors cannot invest directly in an average or an
index.
+ The CDSC is 5% for periods of one year or less, and 3% since inception.
++ From May 30, 1996.
+++ From May 31, 1996.
0 Represents the per share amount of net unrealized depreciation of portfolio
securities as of October 31, 1998.
16
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Emerging Markets Growth Fund
This chart compares a $10,000 hypothetical investment made in Seligman
Henderson Emerging Markets Growth Fund, with and without the initial 4.75%
maximum sales charge for Class A shares, with the 3% contingent deferred sales
charge ("CDSC") for Class B shares, and without the 1% CDSC for Class D shares,
and assumes that all distributions within the period are invested in additional
shares, since the commencement of operations on May 28, 1996, through October
31, 1998, to a $10,000 hypothetical investment made in the Lipper Emerging
Markets Funds Average and the Morgan Stanley Capital International Emerging
Markets Free Index (MSCI EMF Index) for the same period. It is important to keep
in mind that indices and averages exclude the effect of fees and/or sales
charges.
[The table below represents a line chart]
EMERGING MARKETS GROWTH FUND
LIPPER
Class A Class B EMERGING
With Without Class B Class D MARKET MSCI
Sales Sales With Without FUNDS EMF
Charge Charge CDSL CDSL AVERAGE INDEX
5/28/96 9520 10000 10000 10000 10000 10000
7/31/96 9013 9468 9454 9454 9483 9375
10/31/96 9040 9496 9468 9468 9557 9439
1/31/97 10173 10686 10630 10644 10736 10299
4/30/97 10653 11190 11106 11106 10963 10476
7/31/97 12453 13081 12969 12969 12378 11522
10/31/97 9787 10280 10182 10182 9939 8639
1/31/98 9173 9636 9524 9524 9057 7855
4/30/98 10600 11135 10980 10966 10336 8953
7/31/98 9000 9455 9300 9300 8486 7135
10/31/98 6907 7255 6915 7129 6810 5962
There are specific risks associated with global investing, such as currency
fluctuations, foreign taxation, differences in financial reporting practices,
and rapid changes in political and economic conditions. Past performance is not
indicative of future investment results.
LARGEST PORTFOLIO CHANGES
DURING THE SIX MONTHS ENDED OCTOBER 31, 1998
SHARES
----------------------
HOLDINGS
ADDITIONS INCREASE 10/31/98
- --------- -------- --------
Bank Hapoalim (Israel) 245,000 245,000
Blue Square Chain Investments
and Properties (Israel) 61,100 61,100
Coca-Cola Beverages (Poland) 342,600 342,600
Companhia Vale do Rio
Doce (ADRs) (Brazil) 60,000 60,000
Elektrim Spolka Akcyjna
(Poland) 60,000 60,000
Kimberly-Clark de Mexico
(ADRs) (Mexico) 75,000 75,000
National Bank of Greece
(GDRs) (Greece) 29,600 35,520(1)
Telesp Participacoes
(Brazil) 38,000,000 38,000,000
Turkiye Is Bankasi "Isbank"
(GDRs) (Turkey) 182,500 182,500
YPF Sociedad Anonima
(ADRs) (Argentina) 37,000 37,000
SHARES
----------------------
HOLDINGS
REDUCTIONS DECREASE 10/31/98
- ---------- -------- --------
Distribucion y Servicio
(ADRs) (Chile) 60,700 --
Formosa Growth Fund
(Taiwan) 51,000 --
IRSA Inversiones y
Representaciones
(GDRs) (Argentina) 62,000 --
Maillis (Greece) 71,360(2) 36,640
Portugal Telecom (ADRs)
(Portugal) 24,000 --
Richter Gedeon (GDRs)
(Hungary) 13,900 4,900
Sonae Investimentos
(Portugal) 19,000 13,000
Synnex Technology
International
(GDRs) (Taiwan) 57,000 --
Telefonica de Argentina (ADRs)
(Argentina) 39,000 --
Telefonica del Peru
(ADRs) (Peru) 78,300 --
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
- ----------------
(1) Includes 5,920 shares received in a 20% bonus issue.
(2) Includes 54,000 shares received in a 100% bonus issue.
17
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Emerging Markets Growth Fund
SHARES VALUE
--------- -----------
COMMON STOCKS 94.09%
ARGENTINA 4.82%
BANCO RIO DE LA PLATA (ADRS)
Provider of commercial and
investment banking services
(Financial Services) 110,000 $ 990,000
PEREZ COMPANC (ADRS)
Worldwide producer of oil
and gas (Resources) 55,000 539,159
YPF SOCIEDAD ANONIMA (ADRS)
Worldwide producer of oil
and gas (Resources) 37,000 1,070,688
-----------
2,599,847
-----------
BRAZIL 7.78%
COMPANHIA BRASILEIRO DE
DISTRIBUICAO GRUPO PAO
DE ACUCAR (ADRS)
Operator of supermarkets,
consumer electronics, and
appliance stores (Retailing) 35,000 564,375
COMPANHIA VALE DO
RIO DOCE (ADRS)
Mining and transportation
company (Resources) 60,000 905,376
PETROLEO BRASILEIRO "PETROBRAS"
Oil and gas producer and
distributor (Resources) 8,000,000 1,019,365
TELECOMUNICACOES BRASILEIRAS
"TELEBRAS" (ADRS)
Provider of telecommunication
services (Telecommunications) 11,000 835,312
TELESP PARTICIPACOES*
Provider of telecommunication
services
(Telecommunications) 38,000,000 876,016
-----------
4,200,444
-----------
CHILE 1.35%
ENERSIS (ADRS)
Provider of electric services
(Electric Utilities) 35,000 730,625
-----------
- -------------
See footnotes on page 22.
CHINA 4.80%)
CHEUNG KONG INFRASTRUCTURE
HOLDINGS
Real estate investment and
development (Construction
and Property) 240,000 $ 610,498
CHINA RESOURCES ENTERPRISE
Real estate investment
holding company
(Construction and Property) 450,000 601,395
CHINA TELECOM (HONG KONG)*
Provider of cellular
telecommunication services
(Telecommunications) 420,000 789,076
HUANENG POWER
INTERNATIONAL (ADRS)*
Developer and manufacturer
of coal-fired power plants
(Electric Utilities) 43,000 591,250
-----------
2,592,219
-----------
CZECH REPUBLIC 1.68%
CESKE RADIOKOMUNIKACE
(GDRS)*+
Provider of telecommunication
services (Telecommunications) 30,000 907,500
-----------
EGYPT 3.53%
AL-AHRAM BEVERAGES (GDRS)
Producer of beer and soft drinks
(Consumer Goods and Services) 16,400 537,098
PAINTS AND CHEMICAL INDUSTRIES
Manufacturer of industrial and
architectural paints and
printing inks (Manufacturing) 52,200 476,586
SUEZ CEMENT (GDRS)+
Cement manufacturer
(Construction and Property) 58,000 891,831
-----------
1,905,515
-----------
ESTONIA 0.38%
SOCIETIE GENERAL BALTIC
REPUBLICS FUND
Investor in the Baltic
Republics (Financial Services) 3,200 204,800
-----------
18
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Emerging Markets Growth Fund
SHARES VALUE
--------- -----------
GREECE 7.56%
ALPHA CREDIT BANK
Provider of banking services
(Financial Services) 8,000 $ 639,699
HELLENIC TELECOMMUNICATION
ORGANIZATION
Provider of telecommunication
services (Telecommunications) 30,555 695,123
MAILLIS
Producer of plastics
and packaging materials
(Manufacturing) 36,640 621,260
NATIONAL BANK OF GREECE (GDRS)+
Provider of banking services
(Financial Services) 35,520 1,003,440
SARANTIS
Manufacturer and distributor
of cosmetics
(Drugs and Health Care) 63,000 725,579
STET HELLAS TELECOMMUNICATIONS
(ADRS)+
Provider of mobile
telecommunication services
(Telecommunications) 15,000 394,688
-----------
4,079,789
-----------
HUNGARY 6.46%
MAGYAR TAVKOZLESI
"MATAV" (ADRS)
Provider of telecommunication
services (Telecommunications) 55,000 1,478,125
MOL MAGYAR OLAJ-ES
GAZIPARI (GDRS)+
Oil and gas producer and
distributor (Resources) 15,000 341,625
MOL MAGYAR OLAJ-ES
GAZIPARI (GDRS)
Oil and gas producer and
distributor (Resources) 25,000 554,375
OTP BANK (GDRS)+
Provider of commercial banking
services (Financial Services) 11,220 406,725
OTP BANK (GDRS)
Provider of commercial banking
services (Financial Services) 15,000 543,750
- -------------
See footnotes on page 22.
HUNGARY (CONTINUED)
RICHTER GEDEON (GDRS)
Manufacturer of pharmaceuticals
and cosmetics (Drugs and
Health Care) 4,900 $ 164,150
-----------
3,488,750
-----------
INDIA 4.03%
ITC (GDRS)+
Holding company with operations
in tobacco, hotels, financial
services, paper, packaging and
printing, real estate, and
international export
(Diversified) 44,000 880,000
MAHANGAR TELEPHONE
NIGAM (GDRS)+
Provider of telecommunication
services (Telecommunications) 60,000 658,500
MAHANGAR TELEPHONE
NIGAM (GDRS)
Provider of telecommunication
services (Telecommunications) 10,000 109,750
VIDESH SANCHAR NIGAM (GDRS)+
Provider of international
telecommunication services
(Telecommunications) 51,000 525,300
-----------
2,173,550
-----------
ISRAEL 2.26%
BANK HAPOALIM
Provider of banking services
(Financial Services) 245,000 441,550
BLUE SQUARE CHAIN INVESTMENTS
AND PROPERTIES*
Operator of supermarkets
(Retailing) 61,100 778,389
-----------
1,219,939
-----------
LEBANON 1.23%
BANQUE AUDI (GDRS)+
Commercial bank
(Financial Services) 24,600 664,815
-----------
MEXICO 13.27%
FOMENTO ECONOMICO
MEXICANO "FEMSA" (ADRS)
Beverage and packaging
producer; retail store operator
(Consumer Goods and Services) 55,000 1,433,437
19
<PAGE>
MEXICO (CONTINUED)
GRUPO FINANCIERO BANAMEX
ACCIVAL "BANACCI" (SERIES B)*
Provider of banking services
(Financial Services) 655,000 $ 660,711
GRUPO IUSACELL (ADRS)*
Provider of wireless
telecommunication services
(Telecommunications) 32,700 224,813
GRUPO TELEVISA (GDRS)*
Provider of television and
other media services
(Leisure and Hotels) 36,700 995,488
KIMBERLY-CLARK DE MEXICO (ADRS)
Manufacturer and retailer of
consumer and industrial paper
products (Retailing) 75,000 1,074,315
PANAMERICAN BEVERAGES
(CLASS A)
Producer of Coca-Cola and
other beverages (Consumer
Goods and Services) 50,100 1,014,525
PEPSI-GEMEX (GDRS)
Vendor of Pepsi soft
drink products (Consumer
Goods and Services) 117,000 760,500
TELEFONOS DE MEXICO "TELEMEX"
(CLASS L ADRS)
Provider of telecommunication
services (Telecommunications) 19,000 1,003,438
-----------
7,167,227
-----------
PHILIPPINES 3.21%
PHILIPPINE LONG DISTANCE
TELEPHONE
Telephone utility
(Telecommunications) 30,000 717,472
PHILIPPINE LONG DISTANCE
TELEPHONE (ADRS)
Telephone utility
(Telecommunications) 20,000 487,500
SM PRIME HOLDINGS
Developer and operator
of retail properties
(Construction and Property) 3,150,000 530,855
-----------
1,735,827
-----------
- -------------
See footnotes on page 22.
POLAND 4.15%
COCA-COLA BEVERAGES*
Worldwide manufacturer and
distributor of carbonated
flavored soft drinks
(Consumer Goods
and Services) 342,600 $ 722,410
ELEKTRIM SPOLKA AKCYJNA
Exporter/importer active in the
power equipment, electrical
machinery, telecommunication,
cable, and lighting technology
industries (Electronics) 60,000 718,143
POWSZECHNY BANK KREDYTOWY
Provider of financial services
(Financial Services) 20,000 420,377
PROKOM SOFTWARE (GDRS)
Provider of information
technology solutions
(Computer and Technology
Related) 19,100 379,612
-----------
2,240,542
-----------
PORTUGAL 6.59%
JERONIMO MARTINS
Retailer of food and
consumer products (retailing) 31,232 1,347,367
SONAE INVESTIMENTOS
Hypermarket operator
(Retailing) 13,000 548,636
TELECEL-COMUNICACAOES PESSOAIS*
Cellular communication
operator (Telecommunications) 9,050 1,660,356
-----------
3,556,359
-----------
SOUTH AFRICA 7.59%
ANGLO-AMERICAN CORPORATION
OF SOUTH AFRICA
International provider of
financial services to the
mining industry (Resources) 19,200 624,941
20
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Emerging Markets Growth Fund
SHARES VALUE
--------- -----------
SOUTH AFRICA (CONTINUED)
DIMENSION DATA HOLDINGS*
Investment holding company of
technology groupings including
communications, distribution,
software, services, interactive
technologies, and the Internet
(Computer and
Technology Related) 184,000 $ 842,923
LIBERTY LIFE ASSOCIATION OF AFRICA
Provider of life and health
insurance (Financial Services) 43,000 735,829
NEDCOR
International provider of
personal and corporate
financial services
(Financial Services) 37,500 748,663
PEPKOR
Holding company for operators
of clothing and department
stores, supermarkets, and
jewelry retailers (Retailing) 155,000 690,731
SASOL
Fuel and chemical producer
(Diversified) 93,000 455,053
-----------
4,098,140
-----------
SOUTH KOREA 2.68%
KOREA ELECTRIC POWER
Electric power generator and
supplier (Electric Utilities) 66,000 1,175,445
SAMSUNG ELECTRONICS
Manufacturer of consumer
and industrial electronics
and semiconductors
(Manufacturing) 2,191 89,666
SK TELECOM GROUP (ADRS)
Provider of mobile
telecommunication and
paging services
(Telecommunications) 17,400 179,446
-----------
1,444,557
-----------
- -------------
See footnotes on page 22.
TAIWAN 3.64%
CHINA STEEL (GDRS)
Producer of steel and steel
products (Resources) 36,000 $ 495,900
THE ROC TAIWAN FUND
Closed-end fund investing
in Taiwan (Miscellaneous) 80,000 530,000
TAIWAN OPPORTUNITIES FUND*
Closed-end fund investing
in Taiwan (Miscellaneous) 74,000 941,280
-----------
1,967,180
-----------
THAILAND 4.55%
BANGKOK BANK
Provider of retail, commercial,
and corporate banking services
(Financial Services) 440,000 669,020
PTT EXPLORATION AND PRODUCTION
PUBLIC COMPANY
Producer of natural gas
(Resources) 86,000 826,609
THAI FARMERS BANK
PUBLIC COMPANY*
Provider of banking services
(Financial Services) 760,000 959,544
-----------
2,455,173
-----------
TURKEY 2.53%
MIGROS TURK
Retailer of food and consumer
products (Retailing) 1,018,750 866,449
TURKIYE IS BANKASI
"ISBANK" (GDRS)+
Provider of banking services
(Financial Services) 182,500 500,598
-----------
1,367,047
-----------
TOTAL COMMON STOCKS
(Cost $55,711,798) 50,799,845
-----------
21
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Emerging Markets Growth Fund
PRINCIPAL
AMOUNT VALUE
--------- -----------
CORPORATE BONDS 0.21%
(Cost $92,712)
PORTUGAL 0.21%
JERONIMO MARTINS
0%, 12/30/2004
(Retailing) 16,875** $ 113,255
-----------
TOTAL INVESTMENTS 94.30%
(Cost $55,804,510) 50,913,100
OTHER ASSETS
LESS LIABILITIES 5.70% 3,079,165
-----------
NET ASSETS 100.00% $53,992,265
===========
- ----------------
* Non-income producing security.
** Principal amount reported in units of 1,000 Portuguese escudos.
+ Rule 144A security.
Descriptions of companies have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
22
<PAGE>
INVESTMENT REPORT
Seligman Henderson Global Growth Opportunities Fund
PERFORMANCE REVIEW
For the twelve months ended October 31, 1998, Seligman Henderson Global Growth
Opportunities Fund posted a total return of 9.52% based on the net asset value
of Class A shares, compared to the 5.31% total return of its peers, as measured
by the Lipper Global Funds Average. Stocks around the world, as measured by the
Morgan Stanley Capital International World Index (MSCI World Index), posted a
total return of 15.69% for the same period.
The past calendar year was characterized by several distinct phases of global
market activity. From mid-January to mid-July, world markets rose strongly by
approximately 25%, led by Continental Europe and fueled by expectations of lower
inflation and interest rates. After mid-July, the combination of Russian debt
default, speculative attacks against emerging market currencies, and a
worse-than-expected economic impact from Asia upon the rest of the world led to
sharp market corrections. During October, in response to the deflationary
threats facing global economic activity, interest rates were cut in many parts
of the world and a coordinated program of support for the world's financial
system was implemented. As a result, many markets recovered confidence.
FUND OBJECTIVE
Seligman Henderson Global Growth Opportunities Fund, which commenced operations
on November 1, 1995, seeks long-term capital appreciation by investing primarily
in the stocks of companies that have the potential to benefit from global
economic or social trends.
[PHOTO]
INTERNATIONAL TEAM: (FROM LEFT) BEN ELWES, DAVID THORNTON, MICHAEL WOOD-MARTIN,
PETER BASSETT, (SEATED) STACEY NAVIN, NITIN MEHTA (PORTFOLIO MANAGER), KIRSTEEN
MORRISON
During the year, the Fund's bias for stocks with higher earnings growth and a
preference for Continental Europe proved to be the major positive factors. In
contrast, the investments in Asia and other emerging markets negatively impacted
performance. However, the exposure to these markets was reduced significantly
through the year.
PORTFOLIO STRATEGY
The Fund remained broadly invested in the four major growth themes : QUALITY OF
LIFE (36%), PRODUCTIVITY (23%), CONSUMPTION (24%) and GLOBAL TRADE (12%). During
the year, we reduced exposure to the Productivity theme -- in particular, by
reducing investments in Asian technology stocks -- and at the same time we
increased investment in the more stable Quality of Life theme with its emphasis
on health care stocks. Within each theme, we shifted the Fund's investments
toward those with greater earnings reliability.
[PHOTO]
US TEAM: (FROM LEFT) MICHELLE BORRE, DAVE LEVY, SHELIA GRAYSON (ADMINISTRATIVE
ASSISTANT), (SEATED) MARION S. SCHULTHEIS (PORTFOLIO MANAGER); (NOT PICTURED)
CRAIG CHODASH
23
<PAGE>
QUALITY OF LIFE
o As earnings growth became more uncertain around the world, we added to the
Quality of Life sub-themes of health care and savings. During the recent
market turmoil, a "flight to quality" benefited the stocks in this theme.
DURING THE PAST YEAR, WE ADDED SEVERAL DRUG STOCKS, NAMELY Lilly (Eli) IN THE
US, SmithKline Beecham IN THE UK, AND Astra IN SWEDEN. WHILE THE GLOBAL DRUG
STOCKS' VALUATIONS REFLECT THEIR BETTER GROWTH PROSPECTS, WE THINK THEY WILL
PROVIDE GREATER EARNINGS SAFETY IN VOLATILE TIMES. IN ADDITION, WITH RISING
INFLOWS INTO MUTUAL FUNDS IN EUROPE, WE ADDED Skandia IN SWEDEN AND Helvetia
Patria IN SWITZERLAND, BOTH BENEFICIARIES OF THE RISING DEMAND FOR SAVINGS
PRODUCTS AND FALLING INTEREST RATES.
PRODUCTIVITY
o The deterioration in economic activity, first in Asia and then around the
world, reduced the prospects for many technology stocks. In particular,
semiconductor and PC businesses faced a difficult environment. In response, we
reduced the Fund's exposure to technology stocks.
SOUTHEAST ASIA'S FINANCIAL CRISIS, WHICH BEGAN LAST YEAR, SIGNIFICANTLY
REDUCED THE OUTLAYS FOR CAPITAL EXPENDITURE, INCLUDING TECHNOLOGY UPGRADES.
AS A RESULT, WE SOLD ALMOST ALL OF OUR RELATED INVESTMENTS IN THAT REGION,
INCLUDING Silicon Precisionware, Advanced Systems, Hotung, Synnex, Electronic
Resources, AND Datacraft. IN EUROPE, WHERE THE PREPARATION FOR EUROPEAN
MONETARY UNION AND THE NEW MILLENNIUM PUSHED UP THE DEMAND FOR SOFTWARE AND
REGIONAL COMMUNICATION, WE ADDED Cap Gemini, EUROPE'S LARGEST SOFTWARE HOUSE,
AND Equant, A PROVIDER OF DATA NETWORKS TO MULTINATIONAL BUSINESSES.
CONSUMPTION
o Although the aggregate exposure to the Consumption theme hardly changed during
the year, there was a significant shift in exposure from Asia and Emerging
Markets toward Europe. The economic malaise in Asia has severely dented
consumer confidence, while in Europe, rising employment and falling interest
rates had the opposite effect.
WE SOLD A NUMBER OF STOCKS IN JAPAN, HONG KONG, AND SINGAPORE, ALL RELATED TO
CONSUMPTION. AT THE SAME TIME, WE INVESTED IN TWO RETAILERS IN SPAIN WHERE
CONSUMPTION GROWTH HAS BEEN EXCEPTIONALLY STRONG: Centros Comerciales
CONTINENTE, WHICH OPERATES A NATIONWIDE CHAIN OF SUPERMARKETS, AND
Superdiplo, WHICH ALSO OPERATES SUPERMARKETS, BUT MAINLY IN THE SPANISH
ISLANDS. IN THE SAME TREND, WE ADDED ANOTHER SUPERMARKET CHAIN, Kroger, IN
THE US.
GLOBAL TRADE
o The major emphasis is in the telecommunications sub-theme. This sector has
performed well in the past year, with many companies providing either
stability or growth in earnings fueled by more communication traffic and/or
cost-cutting.
OF NOTE, WE ADDED Matav IN HUNGARY AND Hellenic Telecommunication
Organization IN GREECE. BOTH SHOULD BENEFIT FROM AN EXPANSION IN THEIR
NETWORKS AND THE APPLICATION OF NEW TECHNOLOGY TO OFFER VALUE-ADDED SERVICES.
OUTLOOK
World stock markets have been reflecting the global economy's synchronization
toward slower growth. At times like these, profit growth becomes more scarce and
uncertain. Such concern has raised market volatility everywhere. However, we
believe a global economic recession accompanied by prolonged deflation is
unlikely, since appropriate action by the major central banks would be a remedy.
Therefore, excessive pessimism does not seem warranted either. In our opinion,
the current cyclical downturn in economic activity and corporate profitability
around the world should dissipate as we approach the end of the millennium.
The world has an excess of industrial capacity. Until demand rises sufficiently
to meet it, pricing power will be scarce in industrial goods markets. Businesses
in the service sectors are likely to fare better in such an environment.
Fortunately, the Fund's investments are largely in these sectors.
Also, during times of subdued profit advance, high quality growth stocks tend to
perform well. When there is much near-term uncertainty, it is appropriate to
look at the secular trends which are most likely to powerfully drive wealth
creation. In accordance with this philosophy, we will continue to use a thematic
approach to identify superior growth opportunities in which to invest.
24
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Growth Opportunities Fund
COUNTRY ALLOCATION
OCTOBER 31, 1998
MSCI
WORLD
FUND INDEX
------- -------
CONTINENTAL EUROPE 41.89% 23.99%
Austria -- 0.16
Belgium -- 0.89
Denmark -- 0.45
Finland 3.61 0.55
France 8.94 4.49
Germany 4.42 4.96
Greece 1.37 --
Hungary 1.27 --
Ireland 1.87 0.22
Italy 2.05 2.28
Netherlands 4.31 2.57
Norway 1.76 0.23
Portugal -- 0.35
Spain 7.98 1.60
Sweden 3.35 1.31
Switzerland 0.96 3.93
JAPAN 5.58 10.22
LATIN AMERICA 0.98 --
Brazil 0.25 --
Mexico 0.73 --
PACIFIC 1.02 2.82
Australia 0.41 1.29
China 0.59 --
HongKong -- 1.12
New Zealand -- 0.09
Singapore -- 0.32
South Korea 0.02 --
UNITED KINGDOM 10.35 10.43
UNITED STATES 32.61 50.61
OTHER -- 1.93
Canada -- 1.93
OTHER ASSETS LESS LIABILITIES 7.57 --
-------- --------
TOTAL 100.00% 100.00%
======== ========
LARGEST INDUSTRIES
OCTOBER 31, 1998
[The table below represents a bar chart]
Drugs and Health Care 13.0% $23,951,447
Telecommunication 9.4 $17,397,898
Financial Services 8.8 $16,161,471
Retailing 8.3 $15,373,465
Consumer Goods and Services 7.7 $14,180,265
REGIONAL ALLOCATION
OCTOBER 31, 1998
Continental Europe 41.89%
United States 32.61
United Kingdom 10.35
Japan 5.58
Pacific 1.02
Latin America 0.98
Other Assets Less Liabilities 7.57
[The table below represents a pie chart]
LARGEST PORTFOLIO HOLDINGS
OCTOBER 31, 1998
SECURITY VALUE
- ---------- -------------
Nokia (Series A) (Finland) $5,372,029
Cap Gemini (France) 4,862,957
L.M. Ericsson Telefon (Series B)
(Sweden) 3,799,089
Bristol-Myers Squibb (US) 3,637,506
Microsoft (US) 3,505,497
Merck (US) 3,502,975
Elan (ARs) (Ireland) 3,452,330
Centros Comerciales
Continente (Spain) 3,405,163
Philip Morris (US) 3,379,363
CNP Assurances (France) 3,336,734
25
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Growth Opportunities Fund
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS
FOR PERIODS ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION>
AVERAGE ANNUAL
-------------------------------------
CLASS B
SINCE SINCE
SIX ONE INCEPTION INCEPTION
MONTHS* YEAR 4/22/96 11/1/95
--------- ------- --------- ---------
<S> <C> <C> <C> <C>
CLASS A**
With Sales Charge (14.86)% 4.31% n/a 10.34%
Without Sales Charge (10.60) 9.52 n/a 12.17
CLASS B**
With CDSC+ (15.26) 3.76 7.33% n/a
Without CDSC (10.82) 8.76 8.38 n/a
CLASS D**
With 1% CDSC (11.71) 7.76 n/a n/a
Without CDSC (10.82) 8.76 n/a 11.33
LIPPER GLOBAL FUNDS AVERAGE*** (9.83) 5.31 9.62 12.48?
MSCI WORLD INDEX*** (2.85) 15.69 14.23++ 16.590
</TABLE>
NET ASSET VALUE
OCTOBER 31, 1998 APRIL 30, 1998 OCTOBER 31, 1997
------------------ --------------- ------------------
CLASS A $9.62 $10.81 $9.20
CLASS B 9.40 10.59 9.06
CLASS D 9.40 10.59 9.06
CAPITAL GAIN INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1998
PAID $0.418
REALIZED 0.020
UNREALIZED 2.492(00)
Performance data quoted represent changes in prices and assume that all
distributions within the periods are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price and assume the investment of
dividends and capital gain distributions. Returns for Class A shares are
calculated with and without the effect of the initial 4.75% maximum sales
charge. Returns for Class B shares are calculated with and without the
effect of the maximum 5% contingent deferred sales charge ("CDSC"), charged
on redemptions made within one year of the date of purchase, declining to
1% in the sixth year and 0% thereafter. Returns for Class D shares are
calculated with and without the effect of the 1% CDSC, charged on
redemptions made within one year of the date of purchase.
*** The Lipper Global Funds Average and the Morgan Stanley Capital
International World Index (MSCI World Index) are unmanaged benchmarks that
assume reinvestment of dividends. The Lipper Global Funds Average excludes
the effect of sales charges and the MSCIWorld Index excludes the effect of
fees and sales charges. The monthly performance of the Lipper Global Funds
Average is used in the Performance and Portfolio Overview. Investors cannot
invest directly in an average or an index.
+ The CDSC is 5% for periods of one year or less, and 3% since inception.
++ From April 30, 1996.
0 From October 31, 1995.
00 Represents the per share amount of net unrealized appreciation of portfolio
securities as of October 31, 1998.
26
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Growth Opportunities Fund
This chart compares a $10,000 hypothetical investment made in Seligman
Henderson Global Growth Opportunities Fund, with and without the initial 4.75%
maximum sales charge for Class A shares, and without the 1% contingent deferred
sales charge ("CDSC") for Class D shares, and assumes that all distributions
within the period are invested in additional shares, since the commencement of
investment operations on November 1, 1995, through October 31, 1998, to a
$10,000 hypothetical investment made in the Lipper Global Funds Average and the
Morgan Stanley Capital International World Index (MSCIWorld Index) for the same
period. It is important to keep in mind that indices and averages exclude the
effect of fees and/or sales charges.
[The table below represents a Line chart]
Class A With Class A Without Class D MSCI World Lipper Global
Sales Load Sales Load Without CDSL Index Fds. Avg.
------------ --------------- ------------ ---------- -------------
11/1/95 9520 10000 10000 10000 10000
1/31/96 10107 10616 10602 10848 10646
4/30/96 10880 11429 11387 11362 11311
7/31/96 10627 11162 11106 11032 10934
10/31/96 10773 11317 11233 11682 11559
1/31/97 11307 11877 11751 12292 12401
4/30/97 11347 11919 11793 12592 12392
7/31/97 13253 13922 13740 14690 14370
10/31/97 12267 12885 12689 13698 13523
1/31/98 12748 13391 13152 14511 13859
4/30/98 15028 15786 15475 16312 15776
7/31/98 15069 15829 15503 16470 15535
10/31/98 13435 14112 13800 15847 14235
There are specific risks associated with global investing, such as currency
fluctuations, foreign taxation, differences in financial reporting practices,
and rapid changes in political and economic conditions.
As shown on page 26, the performance of Class B shares will be greater than
or less than the performances shown for Class A shares and Class D shares, based
on the differences in sales charges and fees paid by shareholders. Past
performance is not indicative of future investment results.
LARGEST PORTFOLIO CHANGES
DURING THE SIX MONTHS ENDED OCTOBER 31, 1998
SHARES
----------------------------
HOLDINGS
ADDITIONS INCREASE 10/31/98
- ----------- ----------- -----------
AES (US) 27,900 27,900
ASM Lithography Holding
(Netherlands) 74,000 74,000
CNP Assurances (France) 98,000 98,000
ConAgra (US) 65,400 103,700
Equant (Netherlands) 40,600 40,600
NTT Mobile Communication
Network "NTTDoCoMo"
(Japan) 34 34
Philip Morris (US) 66,100 66,100
Superdiplo (Spain) 105,980 105,980
Thomson Travel Group (UK) 500,000 500,000
Tyco International (US) 40,800 40,800
SHARES
----------------------------
HOLDINGS
REDUCTIONS DECREASE 10/31/98
- ------------- ----------- -----------
Coca-Cola Enterprises (US) 57,300 --
Elsevier (Netherlands) 117,615 --
Hewlett-Packard (US) 35,300 --
Intel (US) 31,000 --
Koninklijke KNP BT
(Netherlands) 73,060 --
Lufthansa (Germany) 128,000 --
Meitec (Japan) 59,100 --
PepsiCo (US) 64,500 --
Pfizer (US) 19,200 19,200
Sairgroup (Switzerland) 11,105(1) --
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
- -----------------------
(1) Includes 8,884 shares received as a result of a 5-for-1 stock split.
27
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Growth Opportunities Fund
SHARES VALUE
----------- -----------
COMMON STOCKS 92.35%
AUSTRALIA 0.41%
CSL
Manufacturer and marketer of
human and veterinary
pharmaceutical products
(Drugs and Health Care) 74,000 $ 538,381
TELSTRA*
Provider of telecommunication
services (Telecommunications) 75,000 213,345
----------
751,726
----------
BRAZIL 0.25%
TELECOMUNICACOES BRASILEIRAS
"TELEBRAS" (ADRS)
Provider of telecommunication
services (Telecommunications) 6,000 455,625
----------
CHINA 0.59%
CHINA TELECOM (HONG KONG)*
Provider of cellular
telecommunication services
(Telecommunications) 250,000 469,688
HUANENG POWER INTERNATIONAL (ADRS)*
Developer and manufacturer
of coal-fired power plants
(Electric and Gas Utilities) 45,000 618,750
----------
1,088,438
----------
FINLAND 3.61%
NOKIA (SERIES A)
Developer and manufacturer
of cellular systems and equipment
(Telecommunications) 58,940 5,372,029
RAISION TEHTAAT
Processor and marketer
of agricultural products
(Consumer Goods and Services) 95,000 1,284,166
----------
6,656,195
----------
FRANCE 8.94%
ACCOR
Hotel operator and
provider of related services
(Entertainment and Leisure) 14,583 3,067,477
CAP GEMINI
Provider of computer
consulting services (Computer
and Technology Related) 32,311 4,862,957
- ---------------------
See footnotes on page 32.
SHARES VALUE
----------- ----------
FRANCE (CONTINUED)
CNP ASSURANCES*
Insurance company
(Financial Services) 98,000 $ 3,336,734
GENSET (ADRS)*
Biomedical research company
(Drugs and Health Care) 36,000 1,068,750
HACHETTE FILIPACCHI MEDIAS
Printer and publisher of magazines
and newspapers; online content
provider; distributor of cable radio
(Media) 7,300 1,401,316
VALEO
Manufacturer of automobile
components (Automotive
and Related) 31,698 2,748,150
----------
16,485,384
----------
GERMANY 4.34%
ADIDAS-SALOMON
Manufacturer and marketer of
sporting goods (Retailing) 22,330 2,713,621
METRO
Department store operator
(Retailing) 44,400 2,778,355
PORSCHE
Manufacturer of luxury sports cars
(Automotive and Related) 1,401 2,498,760
----------
7,990,736
----------
GREECE 1.37%
HELLENIC TELECOMMUNICATION
ORGANIZATION
Provider of telecommunication
services (Telecommunications) 78,544 1,786,868
NATIONAL BANK OF GREECE (GDRS)+
Provider of banking services
(Financial Services) 25,800 728,850
----------
2,515,718
----------
HUNGARY 1.27%
MAGYAR TAVKOZLESI "MATAV" (ADRS)
Provider of telecommunication
services (Telecommunications) 47,700 1,281,936
MOL MAGYAR OLAJ-ES GAZIPARI
(GDRS)+
Oil and gas producer and
distributor (Resources) 46,500 1,059,037
----------
2,340,973
----------
28
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Growth Opportunities Fund
SHARES VALUE
----------- ---------
IRELAND 1.87%
ELAN (ADRS)*
Developer, manufacturer,
and marketer of pharmaceutical
delivery systems (Drugs
and Health Care) 49,275 $ 3,452,330
----------
ITALY 2.05%
AEROPORTI DI ROMA
Manager, operator, and
developer of airfields and
terminals (Transportation) 217,890 1,364,308
MEDIOLANUM
Life insurer; provider of
a wide range of financial
services (Financial Services) 97,000 2,417,593
----------
3,781,901
----------
JAPAN 5.58%
BELLSYSTEM 24
Telemarketer (Business Goods
and Services) 7,000 1,347,947
DAITEC
Developer of point-of-sale
systems for Nippon Oil
(Business Goods and Services) 24,300 432,418
DIAMOND COMPUTER SERVICE
Provider of data processing
and software development
services (Computer and
Technology Related) 59,000 864,775
FUJITSU SUPPORT AND SERVICE
Electronic and communication
equipment dealer (Business
Goods and Services) 4,000 201,161
H.I.S.
Travel agency specializing
in overseas and package tours
(Entertainment and Leisure) 69,000 1,304,965
KEYENCE
Manufacturer of detection
devices and measuring control
equipment (Electronics) 12,400 1,245,063
NICHII GAKKAN
Provider of hospital
administrative services
(Drugs and Health Care) 21,100 752,762
- ---------------------
See footnotes on page 32.
SHARES VALUE
----------- -----------
JAPAN (CONTINUED)
NTT MOBILE COMMUNICATION
NETWORK "NTT DOCOMO"
Provider of telecommunication
services (Telecommunications) 34 $ 1,230,518
SECOM
Security services pioneer
(Support Services) 25,000 1,859,016
SOFTBANK
PC wholesaler (Computer
and Technology Related) 14,600 637,593
SUNDRUG
Operator of outlet drug stores
(Retailing) 31,200 407,685
----------
10,283,903
----------
MEXICO 0.73%
FOMENTO ECONOMICO MEXICANO
"FEMSA" (ADRS)
Beverage and packaging
producer; retail store operator
(Consumer Goods and Services) 33,500 873,094
GRUPO TELEVISA (GDRS)*
Provider of television and other
media services (Entertainment
and Leisure) 17,500 474,688
----------
1,347,782
----------
NETHERLANDS 4.31%
ASM LITHOGRAPHY HOLDING*
Manufacturer of semiconductor
production equipment
(Electronics Capital Equipment) 74,000 1,879,642
EQUANT*
Provider of data network services
to multinational corporations
(Business Goods and Services) 40,600 1,762,163
PHILIPS ELECTRONICS
Consumer and industrial
electronics (Electronics) 40,080 2,134,908
POLYGRAM
Producer, marketer, and
distributor of recorded music,
film, television, and video
programming (Entertainment
and Leisure) 36,840 2,173,562
----------
7,950,275
----------
29
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Growth Opportunities Fund
SHARES VALUE
----------- ---------
NORWAY 1.76%
TOMRA SYSTEMS
Provider of recycling systems
used mainly for beverage
containers and crates
(Business Goods and Services) 115,000 $ 3,239,701
----------
SOUTH KOREA 0.02%
SAMSUNG ELECTRONICS (GDRS)*
Manufacturer of
consumer electronics and
semiconductors (Electronics) 1,704 35,656
----------
SPAIN 7.98%
ACTIVIDADES DE CONSTRUCCION
Y SERVICIOS
Designer and builder of public
works projects, residential homes,
and other buildings
(Construction and Property) 76,100 2,432,754
CENTROS COMERCIALES CONTINENTE
Hypermarket chain selling
groceries, kitchen appliances,
auto accessories, and clothing
(Retailing) 114,000 3,405,163
SOCIEDAD GENERAL DE AGUAS
DE BARCELONA
Drinking water supplier; waste
management (Consumer Goods
and Services) 53,930 2,880,409
SOCIEDAD GENERAL DE AGUAS
DE BARCELONA* (RIGHTS)
Drinking water supplier; waste
management (Consumer Goods
and Services) 53,930 26,464
SUPERDIPLO*
Operator of supermarkets,
shopping clubs, boutiques,
and outlets (Retailing) 105,980 2,747,295
TABACALERA (CLASS A)
Manufacturer and marketer
of tobacco products (Tobacco) 133,300 3,223,242
----------
14,715,327
----------
SWEDEN 3.35%
ASTRA (CLASS A)
Developer, manufacturer, and
marketer of pharmaceuticals
(Drugs and Health Care) 129,415 2,100,327
- ---------------------
See footnotes on page 32.
SHARES VALUE
----------- ----------
SWEDEN (CONTINUED)
AUTOLIV (SDRS)
Manufacturer and worldwide
retailer of automobile airbags
and other safety equipment
(Automotive and Related) 8,400 $ 280,198
L.M. ERICSSON TELEFON (SERIES B)
Manufacturer of telecom-
munication equipment
(Telecommunications) 168,250 3,799,089
----------
6,179,614
----------
SWITZERLAND 0.96%
HELVETIA PATRIA HOLDING
Provider of life, property, and
casualty insurance (Financial
Services) 1,945 1,763,210
----------
UNITED KINGDOM 10.35%
BODYCOTE INTERNATIONAL
Diversified manufacturer and
distributor (Industrial Goods
and Services) 148,000 2,136,223
CRT GROUP
Provider of training and
recruitment services; publisher
of multimedia products
(Support Services) 350,000 1,004,518
GAMES WORKSHOP GROUP
Manufacturer and retailer
of specialty games (Retailing) 134,800 1,240,733
GRANADA GROUP
Television group with additional
leisure interests including hotels
(Entertainment and Leisure) 128,800 1,960,398
HALMA
Producer of fire detection and
security equipment
(Electronics) 768,066 1,613,125
LADBROKE GROUP
Leisure group with interests
in hotels and gaming
(Entertainment and Leisure) 375,000 1,369,655
30
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Growth Opportunities Fund
SHARES VALUE
----------- -----------
UNITED KINGDOM (CONTINUED)
PARITY
Provider of software engineering
and consulting services
(Computer and
Technology Related) 225,000 $ 1,703,832
PIZZA EXPRESS
Operator of restaurant
chain (Restaurants) 245,000 3,116,057
ROLLS ROYCE
Aerospace; power generation,
transmission; and distribution
systems (Aerospace) 313,500 1,164,706
SMITHKLINE BEECHAM
Manufacturer and marketer of
pharmaceutical products;
provider of health care
products and services
(Drugs and Health Care) 50,000 616,266
THOMSON TRAVEL GROUP
International vacation and
leisure company
(Entertainment and Leisure) 500,000 1,196,553
WPP GROUP
Provider of worldwide
marketing services, including
advertising, public relations,
and market research (Business
Goods and Services) 400,000 1,961,342
----------
19,083,408
----------
UNITED STATES 32.61%
AES*
Electrical supplier
(Electric and Gas Utilities) 27,900 1,142,156
AMERICAN INTERNATIONAL GROUP
Commercial and industrial
insurer; financial services
(Financial Services) 29,775 2,538,319
AMERICAN TELEPHONE &TELEGRAPH
Provider of communication
services and products
(Telecommunications) 44,800 2,788,800
BRISTOL-MYERS SQUIBB
Developer and manufacturer of
health and personal care
products (Drugs and Health
Care) 32,900 3,637,506
- ---------------------
See footnotes on page 32.
SHARES VALUE
----------- ----------
UNITED STATES (CONTINUED)
CARDINAL HEALTH
Distributor of pharmaceutical
products (Drugs and
Health Care) 32,500 $ 3,073,281
CITIGROUP
Provider of investment
services and life insurance
(Financial Services) 61,350 2,887,284
CONAGRA
Developer and manufacturer
of prepared foods and
agricultural products (Consumer
Goods and Services) 103,700 3,156,369
DAYTON HUDSON
General merchandise retailer,
specializing in large stores
(Retailing) 49,100 2,080,613
DISNEY, WALT
Theme parks and hotel operator;
film production (Entertainment
and Leisure) 40,500 1,090,969
GENERAL DYNAMICS
Manufacturer of defense
products (Capital Goods) 19,500 1,154,156
GENERAL ELECTRIC
Supplier of electrical equipment
and other industrial and
consumer products (Diversified) 36,700 3,211,250
INTERPUBLIC GROUP OF COMPANIES
Global advertising through
agencies in various countries
(Business Goods and Services) 55,350 3,237,975
KROGER*
Operator of supermarkets and
convenience stores (Consumer
Goods and Services) 56,300 3,124,650
LILLY (ELI)
Developer and manufacturer
of pharmaceuticals (Drugs and
Health Care) 38,900 3,148,469
MBNA
Issuer of credit cards; deposit,
loan, and transaction processing
(Financial Services) 102,488 2,337,996
31
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Growth Opportunities Fund
SHARES VALUE
----------- -----------
UNITED STATES (CONTINUED)
MERCK
Developer and manufacturer
of pharmaceuticals (Drugs
and Health Care) 25,900 $ 3,502,975
MICROSOFT*
Provider of computer
software products (Computer
and Technology Related) 33,100 3,505,497
MOTOROLA
Provider of wireless
communications and equipment
(Electronics) 13,900 722,800
PFIZER
Ethical drugs; hospital products;
and specialty chemicals
(Drugs and Health Care) 19,200 2,060,400
PHILIP MORRIS
Tobacco company (Tobacco) 66,100 3,379,363
PROCTER & GAMBLE
Manufacturer and distributor
of household and personal
care products (Consumer
Goods and Services) 31,900 2,835,113
TYCO INTERNATIONAL Worldwide provider
of fire protection devices, electronic
security services, and underwater
telecommunication systems
(Diversified) 40,800 2,527,050
XEROX
Developer, manufacturer, and
marketer of office automation
products (Business Goods
and Services) 30,500 2,954,688
----------
60,097,679
----------
TOTAL COMMON STOCKS
(Cost $121,960,029) 170,215,581
-----------
PRINCIPAL
AMOUNT VALUE
----------- ----------
CORPORATE BONDS 0.08%
(Cost $136,121)
GERMANY 0.08%
METRO FINANCE
0%, 9/7/2013
(Financial Services) 249,000** $ 151,485
----------
TOTAL INVESTMENTS 92.43%
(Cost $122,096,150) 170,367,066
OTHER ASSETS
LESS LIABILITIES 7.57% 13,953,306
----------
NET ASSETS 100.00% $184,320,372
============
- --------------------------------
* Non-income producing security.
** Principal amount reported in German deutschemarks.
+ Rule 144A security.
Descriptions of companies have not been audited by Deloitte &Touche LLP.
See Notes to Financial Statements.
32
<PAGE>
INVESTMENT REPORT
Seligman Henderson Global Smaller Companies Fund
PERFORMANCE REVIEW
For the 12 months ended October 31, 1998, Seligman Henderson Global Smaller
Companies Fund declined 5.82% based on net asset value of Class A shares. In the
same period, the Fund's peer group, as measured by the Lipper Global Small Cap
Funds Average, fell 10.59%, and the Salomon Smith Barney Extended Market Index
World fell 4.49%.
The performance of world markets during the period under review was sharply
divided -- while markets in the Far East were falling, Western markets were
scaling new heights. July saw the peak in these markets, before concerns about
the impact of Asian economic weakness began to gather pace. The growing sense of
crisis swept emerging markets, leading to a devaluation of the Russian rouble,
and fears that Brazil would be forced to devalue. Equity markets collapsed as
concerns about a global financial meltdown spread. As investors became more risk
averse, government bond markets rose to new highs. The rescue of a US hedge fund
and the subsequent reduction in interest rates in the US marked the turning
point for equities, as investors became more confident that the global financial
crisis would be averted. The last two weeks of October saw markets rally
strongly.
FUND OBJECTIVE
Seligman Henderson Global Smaller Companies Fund, which commenced investment
operations on September 9, 1992, seeks long-term capital appreciation by
investing in smaller-company stocks in the US and around the world.
[PHOTO]
INTERNATIONAL TEAM: (FROM LEFT) ANDREW MCNALLY, WILLIAM GARNETT, HEATHER
MANNERS, ANDREW STOCK, (SEATED) MIRANDA RICHARDS, IAIN C. CLARK (PORTFOLIO
MANAGER)
PORTFOLIO STRATEGY
UNITED STATES
o For much of the period, smaller companies in the US were disappointing,
lagging both their larger counterparts and smaller companies in other regions
of the world. Smaller companies in the US peaked in April, then declined
gradually until the summer, when they took a lurch downward. Their
underperformance in the first phase came as investors concentrated on a few
large-cap names and drove the index higher. The poor performance of small
caps in the summer can be attributed to risk aversion, as investors fled to
the safety of bonds or cash from the perceived risk of smaller companies.
However, in October, smaller companies began to stage a recovery, rallying by
almost 22%, as measured by the Salomon Smith Barney Extended Market Index
World. Nevertheless, for the year as a whole, smaller companies fell almost
13%.
EXPOSURE TO THE US ROSE MARGINALLY FROM THE BEGINNING OF THE YEAR. LOOKING
FORWARD, WE WILL LIKELY INCREASE THE ALLOCATION TO THE US TO 50%. FOLLOWING
THEIR CORRECTION, US SMALL CAPS ARE BEGINNING TO ATTRACT INVESTOR ATTENTION,
AS THEY OFFER AN ATTRACTIVE COMBINATION OF GROWTH AT REASONABLE VALUATIONS.
UNITED KINGDOM
o In the UK, smaller companies fared poorly over the year to October, rising
only 3.2%, compared to a rise of 16.3% in larger companies. These figures,
however, ignore a strong outperforming period in the second quarter of 1998.
Following this period, smaller companies fell in line with other markets.
[PHOTO]
US TEAM: (FROM LEFT) TED HILLENMEYER, MIKE SULLIVAN, SONIA THOMAS
(ADMINISTRATIVE ASSISTANT), BRUCE SIRMAN, (SEATED) RICK RUVKUN, ARSEN MRAKOVCIC
(PORTFOLIO MANAGER)
33
<PAGE>
INVESTMENT REPORT
Seligman Henderson Global Smaller Companies Fund
THE UK ECONOMY IS SLOWING AND INTEREST RATES REMAIN HIGH -- NOT AN IDEAL
ENVIRONMENT FOR SMALLER COMPANIES. HOWEVER, THE FUND CONTINUES TO EMPHASIZE
COMPANIES IN THE SERVICE SECTOR WHICH HAVE VISIBLE EARNINGS GROWTH AND
PRICING POWER. THE ALLOCATION TO THE UK WAS OVERWEIGHT THROUGHOUT THE PERIOD,
VARYING BETWEEN 19% AND 25%.
THE ALLOCATION TO THE UK WILL LIKELY BE REDUCED OVER THE COMING MONTHS. WHILE
THE OVERWEIGHT POSITION HAS BEEN POSITIVE FOR PERFORMANCE, CONCERN ABOUT THE
ECONOMIC OUTLOOK AND THE SPEED OF INTEREST-RATE CUTS MAY LEAVE SMALLER
UK-BASED COMPANIES ON THE SIDELINES FOR SOME TIME.
CONTINENTAL EUROPE
o Continental Europe was the best-performing region for smaller companies over
the last 12 months. Total returns were 16.2% compared with 25.9% for larger
companies. The stock markets of Italy and Spain offered the best returns at
48.35% and 35.2%, respectively. Overall, the strong growth in the European
economy, lower interest rates, low valuations, and reasonable earnings growth
rates offered many attractive investment opportunities.
The portfolio has maintained a neutral to slightly overweight position in
Continental Europe throughout the period, peaking at approximately 25% in
November 1997 and ending the period at approximately 23%. Toward the end of
the period, concern has grown about the future growth prospects for Europe.
The Fund has been reducing exposure to more cyclical sectors of the market,
but will maintain a neutral weighting for the next few months.
JAPAN
o For much of the year, the economic background in Japan continued to
deteriorate. The market appeared to be in the grip of deflation, a banking
crisis, and policy paralysis. The government announced fiscal stimulus
packages which failed to meet investor expectations, and the market fell.
Indeed, for the period as a whole, smaller companies fell 17.5%, compared to
a fall of 15% for larger companies. A change in government during the summer
did little to improve investor sentiment, and plans for a resolution of the
banking crisis were met with skepticism among investors. Indeed, concern
about the impact of Japan's problems on the rest of the world was a partial
trigger for the collapse in world markets in the summer.
THE FUND HAD BEEN SIGNIFICANTLY UNDERWEIGHTED IN JAPANESE SMALLER COMPANIES
THROUGHOUT THE PERIOD. HOWEVER, THE ALLOCATION WAS INCREASED TOWARD THE END
OF THE YEAR, AS TENTATIVE SIGNS OF SOME IMPROVEMENT IN THE JAPANESE SITUATION
EMERGED. THE MOVE TO GRADUALLY INCREASE THE POSITION CLOSER TO THE FUND'S
BENCHMARK WILL LIKELY CONTINUE OVER THE NEXT FEW MONTHS.
PACIFIC BASIN
o Given the economic background, it was not surprising that the Pacific Basin
was the worst performer for the 12-month period ending on October 31, falling
27.6%. There was no respite to the worsening news in the region, although
during the drop in global markets in August and particularly in September,
the Pacific Basin performed relatively well. As US interest rates and the
dollar fell, interest rates in the region also declined, providing a stimulus
to equity markets.
The Fund began the year with an underweighted position which remained in
place throughout the period. Looking ahead, we are likely to increase the
allocation. While the underperformance from smaller companies has been
severe, there are tentative signs of improvements at the corporate level
which may lead to selective opportunities in the region.
SUMMARY
The past year has seen a fundamental change in most equity markets. All-time
highs were followed by sharp corrections, which were then followed by sharp
rallies. As volatility increased, investors avoided the perceived risks of
smaller companies. As a result, smaller companies, as measured by the Salomon
Smith Barney Extended Market Index World, underperformed large companies by
20.2% for the year.
Clearly, continued volatility will not favor small caps. However, there are
signs of renewed investor interest in US small caps which could spread to other
regions. Certainly the growth and valuation combination of small caps looks more
attractive than those for large caps in the US, Europe, and the UK, while there
is plenty of scope for positive surprise in Asia.
34
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Smaller Companies Fund
COUNTRY ALLOCATION
OCTOBER 31, 1998
SALOMON
BROTHERS
WORLD
FUND EM Index
------------------
CONTINENTAL EUROPE 22.83% 19.70%
Austria 0.72 0.13
Belgium 0.30 0.58
Denmark 2.44 0.37
Finland -- 0.41
France 5.90 3.36
Germany 1.88 3.89
Ireland 0.27 0.24
Italy 0.68 1.95
Netherlands 3.36 2.69
Norway 2.18 0.19
Portugal -- 0.17
Spain -- 1.36
Sweden 2.15 1.20
Switzerland 2.95 3.16
JAPAN 5.79 8.52
PACIFIC 1.96 2.68
Australia 1.03 1.50
Hong Kong 0.42 0.90
New Zealand 0.10 0.09
Singapore 0.21 0.19
Taiwan 0.15 --
Thailand 0.05 --
UNITED KINGDOM 18.06 10.61
UNITED STATES 40.31 56.45
OTHER 1.48 2.04
Bermuda 0.18 --
Canada 1.30 2.04
OTHER ASSETS LESS LIABILITIES 9.57 --
-------- --------
TOTAL 100.00% 100.00%
-------- --------
-------- --------
LARGEST INDUSTRIES
OCTOBER 31, 1998
[The table below represents a bar chart]
BUSINESS SERVICES 11.9% $103,555,264
RETAILING 7.1% $ 61,628,676
CONSUMER GOODS AND SERVICES 6.8% $ 59,249,735
DRUGS AND HEALTH CARE 6.5% $ 56,154,196
CONSTRUCTION AND PROPERTY 6.4% $ 55,436,874
REGIONAL ALLOCATION
OCTOBER 31, 1998
[The table below represents a pie chart]
United\rStates\r40.31% 40.31%
Continental\rEurope\r22.83% 22.83%
United\rKingdom\r18.06% 18.06%
Japan\r5.79% 5.79%
Pacific\r1.96% 1.96%
Other\r1.48% 1.48%
Other Assets\rLess
Liabilities\r9.57% 9.57%
LARGEST PORTFOLIO HOLDINGS
October 31, 1998
SECURITY VALUE
- ---------- ---------------
CMG (Netherlands) $17,422,976
F.I. Group (UK) 16,065,600
Ashtead Group (UK) 13,085,933
Pizza Express (UK) 12,718,600
PSSWorld Medical (US) 11,174,250
Tandberg Television (Norway) 10,920,127
National Express Group (UK) 10,616,266
Modis Professional Services (US) 10,296,525
Tilbury Douglas (UK) 10,041,000
Total Renal Care Holdings (US) 9,856,326
35
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
SELIGMAN HENDERSON GLOBAL SMALLER COMPANIES FUND
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS
FOR PERIODS ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION>
AVERAGE ANNUAL
------------------------------------------------------------------
CLASS A CLASS B CLASS D
SINCE SINCE SINCE
SIX ONE FIVE INCEPTION INCEPTION INCEPTION
MONTHS* YEAR YEARS 9/9/92 4/22/96 5/3/93
--------- ------ ------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
CLASS A**
With Sales Charge (22.56)% (10.30)% 10.41% 14.49% n/a n/a
Without Sales Charge (18.67) (5.82) 11.49 15.41 n/a n/a
CLASS B**
With CDSC+ (23.06) (11.01) n/a n/a (0.19)% n/a
Without CDSC (19.01) (6.54) n/a n/a 0.91 n/a
CLASS D**
With 1% CDSC (19.76) (7.43) n/a n/a n/a n/a
Without CDSC (18.95) (6.53) 10.66 n/a n/a 12.77%
LIPPER GLOBAL SMALL CAP FUNDS AVERAGE*** (20.67) (10.59) 5.97 10.70++ (0.58)0 8.8600
SALOMON SMITH BARNEY EM INDEX WORLD*** (14.80) (4.49) 7.13 10.09+++ 4.110 8.9400
NET ASSET VALUE
OCTOBER 31, 1998 APRIL 30, 1998 OCTOBER 31, 1997
------------------ --------------- ------------------
CLASS A $14.11 $17.35 $15.62
CLASS B 13.46 16.62 15.04
CLASS D 13.47 16.62 15.05
CAPITAL GAIN (LOSS) INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1998
PAID $0.627
REALIZED (0.257)
UNREALIZED 0.559 000
</TABLE>
Performance data quoted represent changes in prices and assume that all
distributions within the periods are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or less than their original cost.
- ------------------------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price and assume the investment of
dividends and capital gain distributions. Returns for Class A shares are
calculated with and without the effect of the initial 4.75% maximum sales
charge. Returns for Class B shares are calculated with and without the
effect of the maximum 5% contingent deferred sales charge ("CDSC"), charged
on redemptions made within one year of the date of purchase, declining to
1% in the sixth year and 0% thereafter. Returns for Class D shares are
calculated with and without the effect of the 1% CDSC, charged on
redemptions made within one year of the date of purchase.
*** The Lipper Global Small Cap Funds Average and the Salomon Smith Barney
Extended Market Index World (Salomon Smith Barney EM Index World) are
unmanaged benchmarks that assume reinvestment of dividends. The Lipper
Global Small Cap Funds Average excludes the effect of sales charges, and
the Salomon Smith Barney EM Index World excludes the effect of fees and
sales charges.The monthly performance of the Lipper Global Small Cap Funds
Average is used in the Performance and Portfolio Overview. Investors cannot
invest directly in an average or an index.
+ The CDSC is 5% for periods of one year or less, and 3% since inception.
++ From September 10, 1992.
+++ From August 31, 1992.
0 From April 30, 1996.
00 From April 30, 1993.
000 Represents the per share amount of net unrealized appreciation of portfolio
securities as of October 31, 1998.
36
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
SELIGMAN HENDERSON GLOBAL SMALLER COMPANIES FUND
This chart compares a $10,000 hypothetical investment made in Seligman
Henderson Global Smaller Companies Fund Class A shares, with and without the
initial 4.75% maximum sales charge, and assumes that all distributions are
invested in additional shares, since the commencement of investment operations
on September 9, 1992, through October 31, 1998, to a $10,000 hypothetical
investment made in the Lipper Global Small Cap Funds Average and the Salomon
Smith Barney Extended Market Index World (Salomon Smith Barney EM Index World)
for the same period. It is important to keep in mind that indices and averages
exclude the effect of fees and/or sales charges.
[The table below represents a line chart]
Date Class A Class A Salomon Bros. Lipper Global
With Sales Without Sales World EM Small Cap
Load Load Index Fds. Avg.
9/9/92 9520 10000 10000 10000
10/31/92 9533 10014 9787 10015
1/31/93 10528 11059 10523 10958
4/30/93 11343 11915 11655 11702
7/31/93 12225 12841 12252 12396
10/31/93 13334 14006 12822 13974
1/31/94 15150 15914 13511 15151
4/30/94 14895 15645 13346 14533
7/31/94 14263 14982 13383 14215
10/31/94 16037 16846 13609 15015
1/31/95 14757 15501 12860 13764
4/30/95 16461 17291 13807 14657
7/31/95 18567 19504 14831 16494
10/31/95 19260 20231 14546 16398
1/31/96 19922 20926 15482 17161
4/30/96 22540 23677 16879 18945
7/31/96 21930 23036 15879 18069
10/31/96 22526 23661 16710 18759
1/31/97 23205 24375 17258 19714
4/30/97 22049 23161 16662 18880
7/31/97 25016 26277 19110 21639
10/31/97 24391 25621 18942 20883
1/31/98 23981 25191 18782 20265
4/30/98 28247 29671 21234 23538
7/31/98 26928 28286 19759 21799
10/31/98 22972 24130 18091 18672
There are specific risks associated with global investing, such as currency
fluctuations, foreign taxation, differences in financial reporting practices,
and rapid changes in political and economic conditions.
As shown on page 36, the performances of Class B and D shares will be greater
than or less than the performance shown for Class A shares, based on the
differences in sales charges and fees paid by shareholders. Past performance is
not indicative of future investment results.
LARGEST PORTFOLIO CHANGES
DURING THE SIX MONTHS ENDED OCTOBER 31, 1998
SHARES
-------------------------
HOLDINGS
ADDITIONS INCREASE 10/31/98
- ----------- ----------- -----------
ICON (ADRs) (UK) 205,000 205,000
Kaba Holding
(Switzerland) 15,000 15,000
Nobel Biocare (Sweden) 513,484 513,484
Personnel Group
of America (US) 307,300 529,300
Premier Parks (US) 286,300 365,700(1)
Primark (US) 190,100 190,100
PSSWorld Medical (US) 349,600 507,200
Superior Services (US) 197,700 197,700
Tandberg Television
(Norway) 1,180,000 1,180,000
Vlasic Foods International
(US) 254,100 254,100
SHARES
-------------------------
HOLDINGS
ADDITIONS DECREASE 10/31/98
- ----------- ----------- -----------
Ceridian (US) 107,100 79,800
COLT Telecom Group (UK) 800,000(2) --
David Brown Group (UK) 1,831,232 --
FactSet Research
Systems (US) 271,000 --
Jacor Communications (US) 138,500 8,900
MAPICS(US) 626,300 --
Montupet (France) 156,347 159,354(3)
Otra (Netherlands) 448,803 --
Scherer (R.P.)(US) 122,300 --
Telinfo (Belgium) 94,200 24,840
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
- -----------------------------
(1) Includes 39,700 shares received as a result of a 2-for-1 stock split.
(2) Includes 600,000 shares received as a result of a 4-for-1 stock split.
(3) Includes shares received as a result of a 10-for-1 stock split.
37
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
COMMON STOCKS 89.58%
AUSTRALIA 1.03%
BRL HARDY
Owner and operator of
vineyards; producer and
distributor of wines (Consumer
Goods and Services) 259,000 $ 857,251
COCHLEAR
Developer and marketer of
hearing aids (Medical
Products and Technology) 166,000 840,325
CSL
Developer, manufacturer,
and marketer of human and
veterinary pharmaceutical and
diagnostic products (Medical
Products and Technology) 183,500 1,335,041
FUTURIS
Mini-conglomerate with
interests in automobile
components, building
materials, and financial
services (Automotive Parts
Manufacturing) 804,822 824,283
NATIONAL FOODS
Marketer of dairy products;
fruit juice processor; producer
of food packaging (Consumer
Goods and Services) 566,000 1,046,262
NATIONAL MUTUAL PROPERTY TRUST
Operator of commercial office
and industrial real estate
properties (Construction
and Property) 423,900 354,732
PASMINCO
Explorer, producer, and
developer of lead, zinc,
and silver mines (Metals) 1,320,000 1,079,885
STOCKLAND TRUST GROUP
Real estate developer and
marketer (Construction
and Property) 437,300 1,009,628
TAB*
Gaming company which
markets wagers on horse
racing and sporting events
(Leisure and Hotels) 510,000 971,410
HENRY WALKER GROUP
Provider of civil engineering
and mining services
(Support Services) 550,500 615,379
----------------
8,934,196
----------------
AUSTRIA 0.72%
BAU HOLDINGS
(VOTING PREFERENCE SHARES)
Construction and civil
engineering (Construction
and Property) 94,250 4,187,449
BAU HOLDINGS
Construction and civil
engineering (Construction
and Property) 37,894 2,100,428
----------------
6,287,877
----------------
BELGIUM 0.30%
TELINFO
Developer of
telecommunication
networks for businesses
(Telecommunications) 24,840 2,643,017
----------------
BERMUDA 0.18%
DAIRY FARM INTERNATIONAL
HOLDINGS
International food retailer,
manufacturer, and wholesaler
(Retailing) 657,500 808,725
STIRLING COOKE BROWN HOLDINGS
Provider of risk management
services and products
(Financial Services) 44,200 792,837
----------------
1,601,562
----------------
CANADA 1.30%
FINNING INTERNATIONAL
Lessor of construction
equipment (Construction and
Property) 210,000 1,613,813
- ----------------
See footnotes on page 50.
38
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
CANADA (CONTINUED)
FIRSTSERVICE*
Provider of property
management and
business services
(Business Services) 196,900 $ 2,288,962
PMC-SIERRA*
Provider of high-speed
networking circuits
(Technology) 57,300 2,574,919
TELEGLOBE
Owner and operator of a
worldwide telecommunication
network (Telecommunications) 110,000 3,010,376
TROJAN TECHNOLOGIES*
Worldwide environmental
company which specializes
in the disinfection of drinking
water via ultraviolet light
(Support Services) 100,000 1,828,794
----------------
11,316,864
----------------
DENMARK 2.44%
DANSKE TRAELASTKOMPAGNI
Timber supply company
(Construction and Property) 87,130 6,646,494
NEUROSEARCH*
Researcher and developer
of disease remedies
(Drugs and Health Care) 15,000 1,084,642
SONDAGSAVISEN
Operator and distributor of
companies in the media
industry (Media) 30,500 1,502,606
SYDBANK
Commercial financial services
provider (Financial Services) 98,784 4,442,800
THORKILD KRISTENSEN
Property development
(Construction and Property) 84,796 7,546,526
----------------
21,223,068
----------------
FINLAND
TAMRO (SERIES A)
Pharmaceutical distributor for
Scandinavia and the Baltics
(Drugs and Health Care) 230 1,234
----------------
FRANCE 5.69%
COMPAGNIE FRANCAISE D'FTUDES
ET DE CONSTRUCTION TECHNIP
"TECHNIP"
Engineering contractor
(Construction and Property) 49,000 $ 4,990,086
DU PAREIL AU MEME
Manufacturer and
distributor of clothing
for children (Retailing) 22,555 1,573,321
ECIA
Manufacturer of automobile
components (Automotive Parts
Manufacturing) 51,048 9,707,217
ETAM DEVELOPPEMENT
Retailer of women's clothing
and intimate apparel (Retailing) 109,663 5,534,542
L'EUROPENNE D'EXTINCTEURS++
Manufacturer and distributor of
fire extinguishers
(Manufacturing) 132,225 6,887,712
GENSET (ADRS)*
DNA technology firm seeking
to identify and patent genes
and regulatory regions related
to specific diseases (Drugs and
Health Care) 137,000 4,067,188
INTERNATIONAL METAL SERVICE
Distributor and broker of
specialized metal
products (Metals) 100,570 942,617
MONTUPET
Manufacturer of automobile
components (Automotive Parts
Manufacturing) 159,354 7,088,783
SYLEA
Manufacturer of automobile
components (Automotive Parts
Manufacturing) 52,337 3,197,953
VIRBAC
Manufacturer of veterinary
drugs and products
(Veterinary Products) 83,053 5,540,360
----------------
49,529,779
----------------
- ----------------
See footnotes on page 50.
39
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
GERMANY 1.24%
BERU
Developer, manufacturer, and
marketer of diesel engine
systems and automotive products
(Automotive Parts
Manufacturing) 33,600 643,966
BIEN-HAUS
Provider of residential and
multi-family homes
(Construction and Property) 2,615 845,844
GERRY WEBER INTERNATIONAL
Designer and manufacturer
of women's apparel
(Manufacturing) 4,281 98,354
HAWESKO HOLDING
Provider of telecommunication
services (Telecommunications) 96,000 4,817,412
MOEBEL WALTHER
Retailer of furniture and related
products (Retailing) 134,821 4,401,653
----------------
10,807,229
----------------
HONG KONG 0.42%
BEIJING DATANG POWER
GENERATION
Generator and distributor
of electric power
(Electric Utilities) 2,306,000 714,623
ESPRIT HOLDINGS
Retail and wholesale distributor
of high-quality fashion
products (Retailing) 873,000 324,085
JOHNSON ELECTRIC HOLDINGS
Designer, manufacturer, and
marketer of micromotors
(Electronics) 222,000 515,979
KERRY PROPERTIES
Investor and developer in
the real estate industry
(Construction and Property) 205,000 126,396
LI & FUNG
Export trader and wholesale
distributor of consumer
products (Consumer Goods
and Services) 356,200 556,527
SHENZHEN EXPRESSWAY
Developer and operator of
highways (Transportation) 3,512,000 793,595
SOUTH CHINA MORNING POST
English language
newspaper (Media) 300,000 160,759
YANZHOU COAL MINING
(SERIES H)*
Mining company producing
prime-quality, low-sulphur
coal (Resources) 2,134,000 418,837
----------------
3,610,801
----------------
IRELAND 0.27%
ESAT TELECOM GROUP (ADRS)*
Provider of telecommunication
services (Telecommunications) 77,700 2,379,563
----------------
ITALY 0.68%
LA DORIA++
Producer of foods, specializing
in fruits, fruit juices, and canned
tomatoes (Consumer Goods
and Services) 1,686,091 5,922,433
----------------
JAPAN 5.79%
AIYA
Operator of restaurant chain
(Restaurants) 84,600 756,364
ASAHI DIAMOND INDUSTRIES
Manufacturer of diamond-tipped
tools (Manufacturing) 108,000 474,429
ASATSU
Advertising agency (Advertising) 77,500 1,439,072
BENESSE
Provider of educational services
(Business Services) 41,400 1,904,062
ENPLAS
Manufacturer of electronic
components and engineering
plastics (Electronics) 53,000 1,038,814
FORVAL
Producer of telephone systems
(Telecommunications) 40,000 230,389
FUJI FIRE AND MARINE INSURANCE
Non-life insurance firm
(Financial Services) 344,000 656,505
- ----------------
See footnotes on page 50.
40
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
JAPAN (CONTINUED)
FUJICCO
Food manufacturer (Consumer
Goods and Services) 83,300 $ 1,314,038
FUJITSU BUSINESS SYSTEMS
Distributor of computer
equipment (Business Services) 107,900 1,127,929
GLORY KOGYO
Manufacturer and major exporter
of currency-handling machines
(Manufacturing) 108,000 1,309,091
H.I.S.
Travel agency specializing in
overseas and package tours
(Leisure and Hotels) 56,000 1,059,102
HIGASHI NIHON HOUSE
Home builder (Construction
and Property) 206,000 655,233
HITACHI INFORMATION SYSTEMS
Leading data processing firm
(Computer Software) 84,000 758,220
HITACHI MEDICAL
Manufacturer of medical
equipment (Medical Products
and Technology) 76,800 725,581
HOGY MEDICAL
Producer of disposable surgical
gowns and medical supplies
(Medical Products and
Technology) 28,000 655,921
HORIBA INSTRUMENTS
Manufacturer of instruments
and analyzers (Electronics) 147,000 1,353,424
IINO KAIUN KAISHA
Shipping company
(Transportation) 643,000 1,044,720
JAPAN INFORMATION PROCESSING SERVICE
Computer software developer
(Computer Software) 86,100 680,954
JOSHIN DENKI
Budget electrical appliance
retailer (Retailing) 124,000 261,165
KENTUCKY FRIED CHICKEN
Fast food restaurants
(Restaurants) 134,000 1,128,906
KISSEI PHARMACEUTICAL
Manufacturer, seller, importer,
and exporter of medical products
(Drugs and Health Care) 57,000 842,321
KOMATSU SEIREN
Printer of long-staple fabrics
(Manufacturing) 160,000 481,410
KOMORI
Manufacturer of offset printing
machines (Capital Goods) 101,000 1,858,070
MASPRO DENKOH
Manufacturer of reception-related
telecommunication equipment
(Telecommunications) 108,600 774,881
MITSUBISHI CABLE INDUSTRIES
Manufacturer of wire and cable
products (Manufacturing) 280,000 426,048
MITSUBISHI GAS CHEMICAL
Chemical producer
(Chemicals) 137,000 359, 209
MITSUI HOME
Home builder (Construction
and Property) 325,000 1,570,170
NAMURA SHIPBUILDING
Shipbuilder (Capital Goods) 241,000 414,356
NICHICON
Manufacturer of electrical
equipment (Manufacturing) 66,000 717,730
NIPPON BROADCASTING SYSTEM
Vendor of time slots of radio
broadcasting; producer and
marketer of radio programs
(Media) 17,000 577,262
NIPPON SEIKI
Manufacturer of automobile
components (Automotive Parts
Manufacturing) 126,000 834,043
NISHIO RENT ALL
Rentor of construction equipment
(Construction and Property) 101,500 663,142
NISSHA PRINTING
Integrated printing firm
(Paper and Printing) 125,000 730,711
- ----------------
See footnotes on page 50.
41
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
JAPAN (CONTINUED)
NISSHIN FIRE & MARINE INSURANCE
Non-life insurance company
(Financial Services) 288,000 740,271
NITTETSU MINING
Open cast coal miner
(Resources) 102,000 256,918
NOVA
Provider of language instruction
courses (Consumer Goods
and Services) 132,000 397,163
OKINAWA ELECTRIC POWER
Supplier of electricity to Okinawa
Island (Electric Utilities) 55,300 941,277
OLYMPUS OPTICAL
Manufacturer of optoelectronic
and other products (Electronics) 186,000 1,918,762
OTSUKA KAGU
Furniture retailer (Retailing) 19,200 1,056,351
RYOYO ELECTRO
Distributor of electronic goods
(Electronics) 152,000 1,021,827
SAGAMI CHAIN
Noodle restaurant chain
(Restaurants) 94,000 832,323
SANKYO
Manufacturer of pachinko game
equipment (Manufacturing) 117,100 2,003,258
SANYO SPECIAL STEEL
Steel manufacturer (Metals) 681,000 538,594
SHIMACHU
Furniture retailer (Retailing) 61,600 1,043,215
SODICK
Manufacturer of
electrodischargers
(Manufacturing) 273,000 528,046
SUNDRUG
Operator of outlet drug stores
(Retailing) 82,600 1,079,321
TAKASAGO INTERNATIONAL
Specialty chemicals producer,
including fragrances, flavorings,
and aromatic chemicals
(Chemicals) 146,000 739,256
TOKYO STYLE
Manufacturer of women's
ready-to-wear apparel
(Manufacturing) 82,000 820,529
TOWA PHARMACEUTICAL
Generic drug wholesaler
(Drugs and Health Care) 123,000 719,020
TOYO INK MANUFACTURING
Ink manufacturer (Chemicals) 224,000 456,377
TSUBAKI NAKASHIMA
Manufacturer of ball bearings
(Manufacturing) 290,900 1,517,957
TSUDAKOMA
Manufacturer of air-jet looms
(Manufacturing) 674,000 1,013,969
TSUTSUMI JEWELRY
Manufacturer and retailer of
jewelry (Retailing) 107,200 1,336,256
XEBIO
Retailer of outdoor clothing
(Retailing) 110,400 2,021,509
YOKOHAMA REITO
Cold storage, freezing, and
loading services (Distribution) 118,000 587,337
----------------
50,392,808
----------------
NETHERLANDS 3.36%
ATHLON GROEP
Automotive service supplier
(Consumer Goods and Services) 62,680 1,780,205
BENCKISER (SERIES B)
Producer and supplier of
household cleaning
products (Consumer
Goods and Services) 75,134 4,263,807
CMG
Information technology
consulting (Support Services) 749,000 17,422,976
SAMAS GROEP
Manufacturer of office
furniture (Manufacturing) 344,057 5,733,976
----------------
29,200,964
----------------
NEW ZEALAND 0.10%
AUCKLAND INTERNATIONAL AIRPORT*
Owner and operator of the
Auckland International
Airport (Transportation) 395,000 409,978
- ----------------
See footnotes on page 50.
42
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
NEW ZEALAND (CONTINUED)
SKY NETWORK TELEVISION*
Operator of pay television
(Media) 352,100 $ 447,491
----------------
857,469
----------------
NORWAY 2.18%
EKORNES
Manufacturer of home
furnishings (Manufacturing) 855,577 7,859,585
MERKANTILDATA
Distributor and supplier
of information technology
(Computer Software) 18,200 183,291
TANDBERG TELEVISION*
Developer of products and
systems used for television
signals which transfer programs
from channel sources to
viewers (Media) 1,180,000 10,920,127
----------------
18,963,003
----------------
SINGAPORE 0.21%
KEPPEL FELS
Builder of offshore drilling
rigs, production platforms,
and related specialized vessels
(Industrial Goods and Services) 336,000 608,463
VENTURE MANUFACTURING
Contract manufacturer for
the electronics industry
(Electronics) 205,000 681,860
WANT WANT HOLDINGS
Manufacturer of rice crackers
(Consumer Goods and Services) 462,360 550,209
----------------
1,840,532
----------------
SWEDEN 2.15%
ANGPANNEFORENINGEN (SERIES B)
Engineering consultancy
(Business Services) 130,481 1,992,076
BURE INVESTMENT AKTIEBOLAGET
Investment company
(Financial Services) 448,995 5,962,022
SWEDEN (CONTINUED)
FINNVEDEN (SERIES B)
Industrial conglomerate
(Manufacturing) 133,246 2,282,166
MUNSKJO
Producer of specialty paper
(Paper and Printing) 284,800 2,192,315
NOBEL BIOCARE
Developer of titanium implants,
hearing aids, and facial
prostheses (Medical Products
and Technology) 513,484 6,258,385
----------------
18,686,964
----------------
SWITZERLAND 2.95%
BON APPETIT HOLDING++
Food retailer (Retailing) 7,996 4,420,197
BON APPETIT HOLDING (WARRANTS)
Food retailer (Retailing) 9,653 5,358
HERO
Producer and exporter of
food and beverages (Consumer
Goods and Services) 7,340 4,644,194
KABA HOLDING
Provider of electronic and
mechanical security systems
(Business Services) 15,000 7,270,776
SELECTA GROUP
Owner and operator of food
and beverage vending machines
(Consumer Goods and Services) 42,178 9,301,446
----------------
25,641,971
----------------
TAIWAN 0.15%
TAIWAN AMERICAN FUND*
Closed-end fund investing
in Taiwan (Miscellaneous) 86,600 1,337,970
----------------
THAILAND 0.05%
HANA MICROELECTRONICS
Circuit board manufacturer
(Electronics) 171,500 458,668
----------------
UNITED KINGDOM 18.06%
AEA TECHNOLOGY
Provider of engineering and
research and development
services (Industrial Goods
and Services) 300,000 3,664,965
- ----------------
See footnotes on page 50.
43
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED KINGDOM (CONTINUED)
ALLIED LEISURE
Bowling alley operator
(Leisure and Hotels) 4,625,000 $ 1,934,984
ASHTEAD GROUP
Rentor of equipment for
the construction industry
(Construction and Property) 4,010,000 13,085,933
BTG
Technology transfer company
assisting in the commercialization
of technological innovations
(Technology) 328,000 1,825,119
CAPITAL RADIO
Commercial radio station
(Media) 680,200 5,691,574
CHIROSCIENCE GROUP
Pharmaceutical company
specializing in pharmaceuticals
for cancer, pain, and
inflammatory disorders
(Drugs and Health Care) 255,000 1,194,879
CLINTON CARDS
Retailer of greeting cards
(Retailing) 3,107,527 7,098,609
COBHAM
High-integrity engineering
(Manufacturing) 600,000 7,470,504
DAWSON GROUP
Rentor of commercial vehicles
(Transportation) 1,324,600 4,322,600
DIAGONAL
Provider of information
technology services
(Business Services) 105,000 1,546,314
DRUCK HOLDINGS
Worldwide engineering group
(Industrial Goods and Services) 421,200 1,973,659
ELECTRONICS BOUTIQUE
Electronic games retailer
(Retailing) 6,240,000 8,562,965
F.I. GROUP
Designer and builder of
software applications
(Computer Software) 4,000,000 16,065,600
FITNESS FIRST*
Owner and operator
of health and
fitness facilities
(Drugs and Health Care) 172,083 $ 691,154
GAMES WORKSHOP GROUP
Manufacturer and retailer
of specialty games (Retailing) 350,000 3,221,488
GWR GROUP
Local commercial radio
station operator (Media) 1,733,700 5,556,079
HOLMES PLACE
Owner and operator of health
clubs (Leisure and Hotels) 550,000 1,376,035
IBC GROUP
Business information
and education group
(Business Services) 1,695,000 9,460,003
ICON (ADRS)*
Provider of clinical research
and development services to
the pharmaceutical and
biotechnology industries
(Business Services) 205,000 5,752,813
NATIONAL EXPRESS GROUP
Long distance coach services
operating in the UK and
Europe (Transportation) 625,000 10,616,266
PARITY
Provider of software engineering
and consulting services
(Computer Software) 1,105,000 8,367,709
PEPTIDE THERAPEUTICS
Biopharmaceuticals
development company
(Drugs and Health Care) 150,000 200,820
PIZZA EXPRESS
Operator of restaurant chain
(Restaurants) 1,000,000 12,718,600
SHIRE PHARMACEUTICALS*
Biotechnology company
specializing in metabolic bone
and Alzheimer's diseases
(Drugs and Health Care) 362,500 2,581,269
TILBURY DOUGLAS
Building contractor
(Construction and Property) 2,500,000 10,041,000
- ----------------
See footnotes on page 50.
44
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED KINGDOM (CONTINUED)
TOROTRAK*
Designer and developer of
automobile transmission
systems (Automotive Parts
Manufacturing) 328,000 557,142
TRIFAST
Manufacturer and distributor
of fasteners for the
electronics industry
(Electrical Distribution) 463,800 3,997,272
TRINITY INTERNATIONAL HOLDINGS
Publisher of regional
newspapers in the UK, US,
and Canada (Media) 935,100 7,034,180
VANGUARD MEDICA GROUP
Emerging biopharmaceutical
company planning to develop
and commercialize new drugs
(Drugs and Health Care) 184,543 599,135
VANGUARD MEDICA GROUP
(WARRANTS)*
Emerging biopharmaceutical
company planning to develop
and commercialize new drugs
(Drugs and Health Care) 26,362 1,324
----------------
157,209,994
----------------
UNITED STATES 40.31%
ACXIOM*
Provider of data processing
services (Computer Software) 186,300 4,692,431
AFFILIATED COMPUTER SERVICES
(CLASS A)*
Provider of information
technology services and
electronic funds transfer
processing (Business Services) 150,500 5,568,500
ALLIED WASTE INDUSTRIES
Provider of integrated waste
disposal services (Industrial
Goods and Services) 282,600 6,084,731
AMERICAN CAPITAL STRATEGIES
Provider of commercial
financing (Financial Services) 97,200 1,281,825
AMERICAN HOMEPATIENT*
Provider of home health
care services (Drugs and
Health Care) 76,100 $ 197,384
AMERICAN HOMESTAR*
Retailer and producer of
manufactured homes
(Manufacturing) 295,700 4,805,125
AMERICAN MANAGEMENT SYSTEMS*
Provider of information
technology consulting services
(Business Services) 50,000 1,540,625
ANALOG DEVICES*
International manufacturer
and marketer of linear and
digital integrated circuits
(Semiconductors) 100,700 2,001,413
ANTEC*
Developer and supplier of fiber
optic transmission, construction,
and maintenance equipment
for the cable television industry
(Telecommunications) 205,900 3,403,784
AURORA FOODS*
Producer and marketer of
brand name food products
(Consumer Goods and Services) 113,000 1,977,500
AVANT!*
Developer and marketer
of software products that
assist design engineers
(Computer Software) 205,300 3,496,516
AVX
Manufacturer and supplier of
passive electronic components
and related products
(Electronics) 291,600 5,175,900
BA MERCHANT SERVICES (CLASS A)*
Provider of payment processing
services (Business Services) 188,200 3,058,250
BACOU USA*
Designer and manufacturer of
personal protective gear
(Industrial Goods and Services) 205,000 3,574,687
- ----------------
See footnotes on page 50.
45
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED STATES (CONTINUED)
BARNES AND NOBLE*
Owner and operator of retail
book stores and superstores
(Retailing) 132,300 $ 4,316,288
BARR LABORATORIES*
Developer, manufacturer, and
marketer of generic prescription
drugs (Drugs and Health Care) 115,300 3,941,819
BISYS GROUP*
Provider of data processing
services for banks (Business
Services) 105,700 4,637,588
BUDGET GROUP*
Owner and operator of
Budget Rent-a-Car franchises
(Consumer Goods and Services) 65,200 1,169,525
BURR-BROWN*
Manufacturer of microelectric
data devices for business
end-users (Technology) 285,600 5,310,375
CABOT OIL & GAS (CLASS A)
Explorer, developer, and producer
of oil and gas (Energy) 114,200 1,941,400
CALENERGY*
Developer of geothermal energy
power (Electric Utilities) 203,300 5,565,338
CALPINE*
Developer of power generation
facilities (Electric Utilities) 397,900 8,853,275
CARRIAGE SERVICES*
Provider of funeral services
and products (Consumer Goods
and Services) 148,600 3,473,525
CASELLA WASTE SYSTEMS*
Provider of non-hazardous solid
waste collection, disposal,
and recycling services
(Capital Goods) 140,400 4,115,475
CCA PRISON REALTY TRUST
Real estate investment trust
investing in prisons
(Financial Services) 196,800 4,624,800
CERIDIAN*
Provider of data processing
services (Business Services) 79,800 4,578,525
COGNEX*
Manufacturer of machine vision
systems (Electronics) 254,300 $ 3,949,597
COMPDENT*
Provider of managed-care
dental services (Medical
Products and Technology) 281,800 3,399,213
COPART*
Auctioneer of damaged
vehicles for insurance
companies (Retailing) 129,200 2,907,000
CORPORATE EXPRESS*
Supplier of office products
(Retailing) 518,900 6,048,428
COX RADIO (CLASS A)*
Operator of radio stations
(Media) 196,800 7,367,700
CRUSADER HOLDING*
Provider of community
banking services, including
residential mortgages and
commercial leases (Financial
Services) 35,910 426,431
DUANE READE*
Retail drugstore chain
(Retailing) 106,400 4,109,700
EDUTREK INTERNATIONAL*
Operator of post-secondary
educational colleges in three
countries (Technology) 187,700 1,378,422
FUSION SYSTEMS (RIGHTS)*
Supplier of ultraviolet curing
systems, photostabilizers, and
single-wafer ashers used in
semiconductor device
manufacturing (Capital Goods) 70,000 1,094
GENERAL CABLE
Designer, developer, manufacturer,
marketer, and distributor of wire
and cable products for the
communications and
electrical markets
(Manufacturing) 78,000 1,540,500
GENERAL SEMICONDUCTORS*
Designer and manufacturer
of power semiconductors
(Technology) 191,200 1,517,650
- ----------------
See footnotes on page 50.
46
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED STATES (CONTINUED)
GLENAYRE TECHNOLOGIES*
Manufacturer of paging
infrastructure equipment
(Telecommunications) 338,300 $ 2,040,372
HA-LO INDUSTRIES*
Distributor of specialty
advertising products
(Advertising) 208,300 5,884,475
HANGER ORTHOPEDIC GROUP*
Provider of orthopedic and
prosthetic rehabilitation services
(Medical Products
and Technology) 261,600 5,166,600
HEARST-ARGYLE TELEVISION (CLASS A)*
Television broadcaster
(Media) 42,000 1,165,500
HENRY SCHEIN*
International marketer of health
care products and services
to medical providers (Medical
Products and Technology) 91,800 3,551,513
HMT TECHNOLOGY*
Supplier of high-performance
thin-film disks for high-end,
high-capacity, hard disk drives
(Technology) 180,200 1,548,594
INDUS INTERNATIONAL*
Worldwide developer and
marketer of management
software and implementation
services (Business Services) 199,700 1,073,388
INSIGNIA/ESG HOLDINGS*
Provider of real estate services
(Financial Services) 143,799 1,833,437
INSO*
Marketer and developer of
textual information software
(Computer Software) 111,900 2,115,609
INTEGRATED ELECTRICAL SERVICES*
Provider of electrical contracting
and maintenance services to
the commercial, industrial,
and residential markets
(Electronics) 111,400 1,886,838
IVEX PACKAGING*
Manufacturer of specialty
packages (Consumer Goods
and Services) 151,700 2,683,194
JACOR COMMUNICATIONS*
Radio broadcaster (Media) 8,900 490,056
JOURNAL REGISTER*
Newspaper publisher (Media) 341,000 5,477,313
KEYSTONE AUTOMOTIVE INDUSTRIES*
Distributor of aftermarket
collision replacement parts for
automobiles and light trucks
(Distribution) 139,600 2,600,050
LANDCARE USA*
Provider of landscape and tree
services in the commercial and
institutional markets (Business
Services) 251,900 2,015,200
MARCAM SOLUTIONS*
Supplier of business planning
applications and services
(Computer Software) 133,600 918,500
MARKET FACTS*
Compiler of information for
the optimization of the
marketing decision process
(Business Services) 109,900 2,644,469
MCDERMOTT INTERNATIONAL
Manufacturer of steam-
generating and environmental
equipment and products;
provider of engineering
and construction services
(Industrial Goods and Services) 121,800 3,570,263
MEMBERWORKS*
Provider of membership service
programs for various industries
(Consumer Goods
and Services) 135,400 3,122,663
METAMOR WORLDWIDE*
International provider of
information technology
and staffing services
(Business Services) 100,000 2,584,375
- ----------------
See footnotes on page 50.
47
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED STATES (CONTINUED)
MICROCHIP TECHNOLOGY*
Supplier of microcontrollers
and related specialty
memory products (Technology) 190,100 $ 5,156,463
MICROGRAFX*
Developer and marketer of
graphics applications
and software (Business Services) 30,900 281,962
MMI COMPANIES
International health care risk
management company
(Financial Services) 125,400 2,014,237
MODIS PROFESSIONAL SERVICES*
Provider of temporary
personnel services
(Business Services) 584,200 10,296,525
NATIONAL INSTRUMENTS*
Provider of instrumentation
hardware and software products
for the engineering and
scientific industries (Technology) 55,800 1,529,269
NEW AMERICAN HEALTHCARE*
Operator of acute-care hospitals
(Drugs and Health Care) 96,000 1,020,000
NOVA*
Producer and marketer of
petrochemicals and plastics;
natural gas pipeline operator
(Business Services) 172,672 4,985,904
OAK INDUSTRIES*
Manufacturer of cable television
connectors and fiber optic
components (Electronics) 29,000 784,812
OM GROUP
Producer of specialty chemicals
(Chemicals) 183,900 5,999,737
OMNICARE
Provider of pharmaceutical
services to long-term care
institutions (Drugs and
Health Care) 95,700 3,307,631
PERSONNEL GROUP OF AMERICA*
Provider of personnel
staffing services
(Business Services) 529,300 8,204,150
PETERSEN COMPANIES (CLASS A)*
Special-interest magazine
publisher (Media) 159,700 $ 4,242,031
PHARMACEUTICAL PRODUCT
DEVELOPMENT*
Provider of consulting services in
the discovery, environmental, and
life sciences (Medical Products
and Technology) 74,300 2,015,387
PHYSICIANS' SPECIALTY*
Provider of practice management
services to physicians
(Drugs and Health Care) 200,000 1,450,000
PIER 1 IMPORTS
Retailer specializing in
decorative home furnishings,
gifts, and related items
(Retailing) 162,000 1,498,500
PRE-PAID LEGAL SERVICES*
Underwriter and marketer
of legal service plans
(Business Services) 122,300 2,927,556
PREMIER PARKS*
Owner and operator of
regional theme parks
(Leisure and Hotels) 365,700 8,113,969
PRIMARK*
Provider of information
through software and
databases (Consumer Goods
and Services) 190,100 5,132,700
PROFESSIONAL DETAILING*
Provider of consulting services
to the pharmaceutical industry
(Business Services) 159,200 3,781,000
PROVANT*
Provider of training and
development services
(Business Services) 161,200 1,884,025
PROVINCE HEALTHCARE*
Provider of health care services
in non-urban markets (Drugs
and Health Care) 187,900 4,914,759
- ----------------
See footnotes on page 50.
48
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED STATES (CONTINUED)
PSS WORLD MEDICAL*
Distributor of medical
supplies, equipment, and
pharmaceuticals (Drugs
and Health Care) 507,200 $ 11,174,250
QUORUM HEALTH GROUP*
Owner and operator of
acute-care hospitals
(Drugs and Health Care) 77,000 1,114,094
RENAL CARE GROUP*
Provider of dialysis services
(Medical Products
and Technology) 16,400 477,137
RENEX*
Provider of dialysis and
ancillary services (Drugs and
Health Care) 189,300 845,934
SANMINA*
Provider of services for
equipment manufacturers
in the electronic industry
(Industrial Goods
and Services) 121,800 5,009,025
SANTA FE ENERGY RESOURCES*
Explorer, producer, and
developer of oil and gas
(Resources) 289,800 2,354,625
SCHEIN PHARMACEUTICAL*
Developer, manufacturer, and
vendor of generic
pharmaceuticals (Drugs and
Health Care) 72,400 769,250
SINCLAIR BROADCAST GROUP (CLASS A)*
Diversified broadcasting
company that owns
and services television and
radio stations (Media) 132,000 1,707,750
SOLA INTERNATIONAL*
Designer and manufacturer
of optical supplies (Consumer
Goods and Services) 41,000 786,687
STEINWAY MUSICAL INSTRUMENTS*
Manufacturer of musical
equipment (Consumer
Goods and Services) 90,600 1,998,862
STRUCTURAL DYNAMICS RESEARCH*
Developer of mechanical design
software (Computer Software) 138,200 $ 2,003,900
SUNGARD DATA SYSTEMS*
Provider of computer disaster
recovery services, as well as
health care information and
investment support systems
(Computer Software) 62,300 2,102,625
SUPERIOR SERVICES*
Provider of solid waste collection,
disposal, and recycling
services (Business Services) 197,700 4,126,987
TOTAL RENAL CARE HOLDINGS*
Provider of dialysis services
(Drugs and Health Care) 402,299 9,856,326
TRANSACTION SYSTEMS ARCHITECTS*
Producer of software products
for the global electronic funds
transfer market (Technology) 125,100 4,515,328
TRIANGLE PHARMACEUTICALS*
Developer of new drugs,
primarily in the antiviral area
(Drugs and Health Care) 127,500 1,490,156
UCAR INTERNATIONAL*
Manufacturer of graphite
and carbon electrodes
(Capital Goods) 278,600 5,014,800
UNIGRAPHICS SOLUTIONS (Class A)*
International provider of services
used for virtual product develop-
ment (Business Services) 192,300 1,634,550
UNIVERSAL HEALTH SERVICES*
Owner and operator of health
care institutions (Drugs
and Health Care) 79,700 4,089,606
U.S. FOODSERVICE*
Distributor of food and
related products (Business
Services) 134,500 6,388,750
VALLEY NATIONAL GASES*
Packager and distributor of
gases (Chemicals) 282,300 1,940,812
- ----------------
See footnotes on page 50.
49
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Smaller Companies Fund
SHARES VALUE
------- -------
UNITED STATES (CONTINUED)
VLASIC FOODS INTERNATIONAL*
Manufacturer and marketer
of branded convenience
food products (Consumer
Goods and Services) 254,100 $ 4,748,494
WATERS*
Manufacturer of liquid
chromatography instruments
(Medical Products
and Technology) 29,500 2,168,250
WATSON PHARMACEUTICALS*
Manufacturer of off-patent
medications (Medical Products
and Technology) 73,900 4,110,688
WILMAR INDUSTRIES*
Marketer and distributor of
repair and maintenance
products to the apartment
housing market (Consumer
Goods and Services) 145,000 3,516,250
XILINX*
Supplier of field-programmable
gate arrays (Technology) 48,500 2,165,828
YOUTH SERVICES*
Operator of residential and
community-based programs
for at-risk youths
(Support Services) 214,200 833,372
-------------------
350,889,701
-------------------
TOTAL COMMON STOCKS
(Cost $742,359,162) 779,737,667
-------------------
PREFERRED STOCKS 0.64%
(Cost $7,883,115)
GERMANY 0.64%
GERRY WEBER INTERNATIONAL
Designer and manufacturer
of ladies' apparel
(Manufacturing) 275,472shs. $ 5,579,390
-----------------
CONVERTIBLE BONDS 0.21%
(Cost $1,698,581)
FRANCE 0.21%
L'EUROPENNE D'EXTINCTEURS
41/4%, 1/1/2005
(Manufacturing) $2,190,800 1,796,709
-----------------
SHORT-TERM HOLDINGS 1.15%
(Cost $10,000,000) 10,000,000
-----------------
TOTAL INVESTMENTS 91.58%
(Cost $761,940,858) 797,113,766
OTHER ASSETS
LESS LIABILITIES 8.42% 73,264,088
----------------
NET ASSETS 100.00% $870,377,854
- ----------------
*Non-income producing security.
++Affiliated issuers (a Series' holdings representing 5% or more of the
outstanding voting securities).
Descriptions of companies have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
50
<PAGE>
INVESTMENT REPORT
Seligman Henderson Global Technology Fund
PERFORMANCE REVIEW
Seligman Henderson Global Technology Fund posted a return of -0.79% based on the
net asset value of Class A shares for the year ended October 31, 1998. This
compares to the 5.31% and 11.10% total returns of its peers, as measured by the
Lipper Global Funds Average and the Lipper Science and Technology Funds Average,
respectively. The Morgan Stanley Capital International World Index posted a
total return of 15.69% for the same period.
The caution that we expressed in our report of April 30, 1998, proved
appropriate, although our forecast did not extend to anticipating the scale of
the collapse in technology share prices from August through October. Without the
sharp rebound that we enjoyed over the last three weeks of October, we would
have been obliged to report on one of the most disappointing half years since
the Fund's launch.
US technology shares fared least poorly over the period although, at one stage,
the Pacific Stock Exchange Technology Index had fallen more than 25% from its
late July high. Smaller companies in the sector declined throughout the summer,
and by early October, had fallen more than 40% from their April peak. In
contrast, European technology shares proved resilient for most of the period
before collapsing in September. Meanwhile, Asian technology companies continued
their long period of underperformance.
FUND OBJECTIVE
Seligman Henderson Global Technology Fund, which commenced operations on May 23,
1994, seeks long-term capital appreciation by investing in securities of
companies around the world that operate in the technology and technology-related
industries.
[PHOTO]
INTERNATIONAL TEAM: (FROM LEFT) EMMA PARKINSON, TIM WOOLLEY, DAVID MAGLIOCCO,
BRIAN ASHFORD-RUSSELL (PORTFOLIO MANAGER)
PORTFOLIO STRATEGY
WE RAISED SUBSTANTIAL LIQUIDITY DURING THE SUMMER, TAKING PROFITS IN A BROAD
RANGE OF EUROPEAN STOCKS. A SIGNIFICANT PROPORTION OF THAT LIQUIDITY WAS LATER
REINVESTED IN THE US, ESPECIALLY JUST AFTER THE END OF THE FUND'S OCTOBER FISCAL
YEAR.
WE BELIEVE THAT THE EARLY OCTOBER LOW FOR THE SECTOR HAD ALL THE
CHARACTERISTICS OF A MAJOR BOTTOM -- ONE WHICH SEEMs LIKELY, AT LEAST IN THE
SHORT TERM, TO BE MARKED BY AN END TO THE EXTRAORDINARY UNDERPERFORMANCE OF
SMALL-CAP US TECHNOLOGY SHARES. WE THEREFORE ADDED TO OUR POSITIONS IN A NUMBER
OF SMALL- AND MID-CAP COMPANIES SUCH AS Amkor Technology, DII Group, AND
Ziff-Davis. WE HAVE ALSO ADDED TO OUR CYCLICAL TECHNOLOGY WEIGHTING IN THE US.
THIS REFLECTS OUR BELIEF THAT CONDITIONS IN THE SEMICONDUCTOR MARKET ARE NO
LONGER DETERIORATING, AND THAT A HEALTHY PC MARKET SHOULD ALLOW A BETTER BALANCE
BETWEEN COMPONENT SUPPLY AND DEMAND.
[PHOTO]
US TEAM: (FROM LEFT) PAUL KRIEGER, PATRICK RENDA, LAWRENCE ROSSO,STORM BOSWICK,
(SEATED) PAUL WICK (PORTFOLIO MANAGER); (NOT PICTURED) KEI YAMAMOTO
51
<PAGE>
THE IMPROVEMENT IN THESE AREAS SHOULD ALSO PROVIDE THE CONDITIONS NECESSARY
FOR BETTER RELATIVE PERFORMANCE FROM ASIAN TECHNOLOGY SHARES. CONSEQUENTLY, WE
HAVE NOT REDUCED OUR ASIAN WEIGHTING TO FINANCE OUR INCREASED US EXPOSURE, BUT
HAVE INSTEAD CUT BACK ON OUR EUROPEAN POSITIONS. IN SO DOING WE HAVE TAKEN
PROFITS IN SOME OF OUR MOST SUCCESSFUL HOLDINGS SUCH AS COLT Telecom Group,
Vodafone, CMG, AND Logica.
SUMMARY
The recent spectacular rise in both markets and technology shares has taken us
back into more neutral territory. However, we expect that the sector will enjoy
another upward leg over the next several months, even if a pause occurs in the
very short term. Confidence is slowly rebuilding; demand in the PC and
networking markets remains robust, and at the margin, is improving in the
components, communications, and wireless areas. Year 2000 issues may have the
effect of concentrating corporate information technology (IT) demand into the
first half of next year, thereby encouraging investors to chase (what may prove
to be unsustainable) earnings momentum in the sector. European demand is proving
resilient in the face of the global economic slowdown, a reflection of the far
lower rates of IT penetration in Europe as compared to the US. Asian demand,
although depressed, should be improving by the second half of 1999.
Consequently, we anticipate further strength in the technology sector and do not
expect any significant setbacks in early 1999, and if setbacks should occur
then, they will be from considerably higher levels than at the end of October
1998.
52
<PAGE>
Performance and Portfolio Overview
Seligman Henderson Global Technology Fund
COUNTRY ALLOCATION
OCTOBER 31, 1998
MSCI
WoRLD
fund INDEX
------- -------
CONTINENTAL EUROPE 14.54% 23.99%
Austria -- 0.16
Belgium -- 0.89
Denmark -- 0.45
Finland 1.09 0.55
France 3.85 4.49
Germany 1.56 4.96
Ireland -- 0.22
Italy 1.10 2.28
Luxembourg 1.18 --
Netherlands 1.86 2.57
Norway -- 0.23
Portugal -- 0.35
Spain -- 1.60
Sweden 2.39 1.31
Switzerland 1.51 3.93
JAPAN 4.56 10.22
PACIFIC 5.66 2.82
Australia 1.16 1.29
Hong Kong -- 1.12
New Zealand -- 0.09
Singapore 2.44 0.32
South Korea 0.14 --
Taiwan 1.92 --
UNITED KINGDOM 10.87 10.43
UNITED STATES 52.46 50.61
OTHER 5.86 1.93
Canada 0.30 1.93
Israel 5.56 --
OTHER ASSETS LESS LIABILITIES 6.05 --
-------- --------
TOTAL 100.00% 100.00%
======== =======
LARGEST INDUSTRIES
October 31, 1998
COMPUTER SOFTWARE 22.5% $161,513,880
COMPUTER HARDWARE/PERIPHERALS 12.9% $ 92,587,856
COMPUTER AND BUSINESS SERVICES 9.7% $ 69,739,884
SEMI-CONDUCTORS 8.8% $ 63,305,565
ELECTRONICS 8.0% $ 58,683,716
REGIONAL ALLOCATION
OCTOBER 31, 1998
United States 52.46% 52.46%
Continental Europe 14.54% 14.54%
United Kingdom 10.87% 10.87%
Other 5.86% 5.86%
Pacific 5.66% 5.66%
Japan 4.56% 4.56%
Other Assets Less
Liabilities 6.05% 6.05%
LARGEST PORTFOLIO HOLDINGS
October 31, 1998
SECURITY VALUE
- ---------- ---------------
EMC (US) $32,187,500
Synopsys (US) 17,610,937
Lexmark International Group
(Class A) (US) 17,484,375
Maxim Integrated Products (US) 17,293,281
Network Associates (US) 17,046,993
ECI Telecommunications (Israel) 16,625,000
Microsoft (US) 15,885,938
The Learning Company (US) 15,487,500
Electronic Arts (US) 14,350,000
VeecoInstruments (US) 11,912,500
53
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Technology Fund
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS
FOR PERIODS ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION>
AVERAGE ANNUAL
-------------------------------------
CLASS B
SINCE SINCE
SIX ONE INCEPTION INCEPTION
MONTHS* YEAR 5/23/94 4/22/96
---------- ------- ------------ ------------
CLASS A**
<S> <C> <C> <C>
With Sales Charge (18.24)% (5.53)% 18.93% n/a
Without Sales Charge (14.16) (0.79) 20.25 n/a
CLASS B**
With CDSC+ (18.72) (5.62) n/a 8.69%
Without CDSC (14.54) (1.55) n/a 9.73
CLASS D**
With 1% CDSC (15.40) (2.51) n/a n/a
Without CDSC (14.56) (1.70) 19.25 n/a
Lipper Global Funds Average*** (9.83) 5.31 10.74++ 9.680
LIPPER SCIENCE &
TECHNOLOGY FUNDS AVERAGE*** (4.74) 11.10 24.02++ 14.640
MSCI WORLD INDEX*** (2.85) 15.69 14.65+++ 14.230
NET ASSET VALUE
</TABLE>
OCTOBER 31, 1998 APRIL 30, 1998 OCTOBER 31, 1997
------------------ --------------- ------------------
CLASS A $12.48 $14.83 $15.14
CLASS B 11.98 14.31 14.73
CLASS D 11.96 14.29 14.73
CAPITAL GAIN INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1998
PAID $2.586
REALIZED 0.802
UNREALIZED 1.07000
Performance data quoted represent changes in prices and assume that all
distributions within the periods are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or less than their original cost.
- ------------------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price and assume the investment of
dividends and capital gain distributions. Returns for Class A shares are
calculated with and without the effect of the initial 4.75% maximum sales
charge. Returns for Class B shares are calculated with and without the
effect of the maximum 5% contingent deferred sales charge ("CDSC"),charged
on redemptions made within one year of the date of purchase, declining to
1% in the sixth year and 0% thereafter. Returns for Class D shares are
calculated with and without the effect of the 1% CDSC, charged on
redemptions made within one year of the date of purchase.
*** The Lipper Global Funds Average, the Lipper Science & Technology Funds
Average, and the Morgan Stanley Capital International World Index (MSCI
World Index) are unmanaged benchmarks that assume reinvestment of
dividends. The Lipper Global Funds Average and the Lipper Science &
Technology Funds Average exclude the effect of sales charges and the MSCI
World Index excludes the effect of fees and sales charges. The monthly
performances of the Lipper Global Funds Average and the Lipper Science &
Technology Funds Average are used in the Performance and Portfolio
Overview. Investors cannot invest directly in an average or an index.
+ The CDSC is 5% for periods of one year or less, and 3% since inception.
++ From May 26, 1994.
+++ From May 31, 1994.
0 From April 30, 1996.
00 Represents the per share amount of net unrealized appreciation of
portfolio securities as of October 31, 1998.
54
<PAGE>
PERFORMANCE AND PORTFOLIO OVERVIEW
Seligman Henderson Global Technology Fund
This chart compares a $10,000 hypothetical investment made in Seligman
Henderson Global Technology Fund, with and without the initial 4.75% maximum
sales charge for Class A shares, and without the 1% contingent deferred sales
charge ("CDSC") for Class D shares, and assumes that all distributions are
invested in additional shares, since the commencement of operations on May 23,
1994, through October 31, 1998, to a $10,000 hypothetical investment made in the
Lipper Global Funds Average, the Lipper Science &Technology Funds Average, and
the Morgan Stanley Capital International World Index (MSCI World Index) for the
same period. It is important to keep in mind that indices and averages exclude
the effect of fees and/or sales charges.
There are specific risks associated with global investing, such as currency
fluctuations, foreign taxation, differences in financial reporting practices,
and rapid changes in political and economic conditions.
As shown on page 54, the performance of Class B shares will be greater than or
less than the performances shown for Class A shares and Class D shares, based on
the differences in sales charges and fees paid by shareholders. Past performance
is not indicative of future investment results.
Class A With Sales Load
Class A Without Sales Load
Class D Without CDSL
MSCI World Index
Lipper Global Funds Avg.
Lipper Sci. & Tech Fds. Avg.
5/23/94 9520 10000 10000 10000 10000 10000
7/31/94 9613 10098 10084 10165 10089 9874
10/31/94 11160 11723 11681 10491 10425 11759
1/31/95 10695 11234 11150 9987 9604 11377
4/30/95 13264 13933 13821 10997 10332 13185
7/31/95 16856 17706 17523 11649 11303 16641
10/31/95 17556 18441 18216 11543 11158 17245
1/31/96 15895 16697 16458 12522 11880 16436
4/30/96 17535 18419 18119 13116 12621 18456
7/31/96 15004 15760 15477 12734 12200 16172
10/31/96 16269 17090 16745 13486 12898 18920
1/31/97 19981 20988 20535 14189 13838 21533
4/30/97 18571 19507 19055 14536 13827 18908
7/31/97 23634 24826 24204 16957 16031 24437
10/31/97 21779 22877 22241 15813 15089 23391
1/31/98 21113 22178 21506 16750 15464 23009
4/30/98 25170 26439 25588 18829 17603 27281
7/31/98 23753 24951 24093 19012 17334 26628
10/31/98 21606 22696 21863 18293 15884 25987
LARGEST PORTFOLIO CHANGES
During the Six Months Ended October 31, 1998
SHARES
-------------------------
HOLDINGS
ADDITIONS INCREASE 10/31/98
- ----------- ----------- -----------
Autodesk (US) .................. 200,000 300,000
Canon (Japan) .................. 300,000 300,000
DIIGroup (US) .................. 400,000 400,000
Koninklijke (Royal) Philips
Electronics (Netherlands) ... 100,000 100,000
The Learning Company
(US) ........................ 600,000 600,000
Microsoft (US) ................. 150,000 150,000
Novartis (Switzerland) ......... 6,000 6,000
Platinum Technology
(US) ........................ 400,000 400,000
SCISystems (US) ................ 200,000 200,000
WM-Data (Series B)
(Sweden) .................... 176,900 176,900
SHARES
-------------------------
HOLDINGS
REDUCTIONS DECREASE 10/31/98
- ------------- ----------- -----------
AlcatelAlsthom (France) 63,000 --
America Online (US) 190,000 --
American Power
Conversion (US) 275,000 --
COLT Telecom
Group (UK) 1,558,200(1) 480,000
Kulicke &Soffa
Industries (US) 600,000 --
LHS Group (Germany) 135,000(2) --
Logica (UK) 349,000 201,000
Novellus Systems (US) 450,000 --
Storage Technology (US) 100,000 300,000(3)
Vodafone (UK) 700,000 500,000
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
- ------------------
(1) Includes 1,367,400 shares received as a result of a 4-for-1 stock split.
(2) Includes 50,000 shares received as a result of a 2-for-1 stock split.
(3) Includes 150,000 shares received as a result of a 2-for-1 stock split.
55
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
COMMON STOCKS 93.95%
AUSTRALIA 1.16%
COCHLEAR
Developer and marketer
of hearing aids (Medical
Products and Technology) 1,650,000 $ 8,352,625
----------------
CANADA 0.30%
PMC-SIERRA*
Provider of high-speed
networking circuits
(Semiconductors) 48,400 2,174,975
----------------
FINLAND 1.09%
NOKIA (SERIES A)
Developer and manufacturer
of cellular systems
and equipment
(Telecommunications) 86,000 7,838,386
----------------
FRANCE 3.85%
ALTRAN TECHNOLOGIES
Provider of computer services
(Computer and
Business Services) 33,000 6,465,573
AXIME
Provider of banking and financial
services, emphasizing database
development, communication
networks, and integrated
trading systems (Computer and
Business Services) 24,500 4,627,974
RH(TM)NE-POULENC (SERIES A)
Manufacturer of chemicals,
polymers, fibers, pharmaceuticals,
and agricultural chemicals
(Medical Products and
Technology) 210,000 9,614,275
STMICROELECTRONICS*
Manufacturer of semiconductor
circuits for the automotive,
computer, and
telecommunication industries
(Electronics) 25,000 1,520,306
UNILOG
Computer consultants
(Computer and
Business Services) 15,300 5,432,769
----------------
27,660,897
----------------
Germany 1.56%
MANNESMANN
Manufacturer of plant and
machinery equipment;
automotive optical inspection
systems (Machinery and
Equipment) 115,400 $ 11,191,149
SIEMENS
Worldwide manufacturer of
automotive electronics,
locomotives, electrical power
plants, and traffic control systems
(Machinery and Equipment) 445 27,066
----------------
11,218,215
----------------
ISRAEL 5.56%
CHECK POINT SOFTWARE TECHNOLOGIES*
Provider of network "firewall"
security systems
(Computer Software) 200,000 4,556,250
ECI TELECOMMUNICATIONS
Provider of digital
telecommunication and
data transmission systems
(Networking/Communications
Infrastructure) 500,000 16,625,000
ORBOTECH*
Manufacturer of automated
optical inspection systems
for circuit boards and
flat panel displays
(Electronics) 330,000 11,488,125
TECNOMATIX TECHNOLOGIES*++
Developer and retailer of
computer-aided production
engineering software
(Computer Software) 500,000 7,250,000
----------------
39,919,375
----------------
ITALY 1.10%
TELECOM ITALIA
Provider of telecom-
munication services
(Telecommunications) 1,092,933 7,911,580
----------------
- ----------------
See footnotes on page 62.
56
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
JAPAN 4.56%
CANON
Manufacturer of printers and
photocopiers (Electronics) 300,000 $ 5,686,654
HIROSE ELECTRONICS
Manufacturer of specialized
connectors (Electronics) 60,800 3,528,046
MIMASU SEMICONDUCTOR
Wafer inspection devices
(Electronics Capital Equipment) 180,000 2,011,605
MURATA MANUFACTURING
MANUFACTURER OF CAPACITORS
(ELECTRONICS) 125,000 4,223,082
RICOH
Manufacturer of office
equipment (Machinery and
Equipment) 310,000 2,624,973
ROHM
Producer of custom
linear integrated circuits
(Semiconductors) 37,000 3,276,166
SECOM
Security services pioneer
(Computer and
Business Services) 109,000 8,105,308
SHARP
Manufacturer of electronics
(Electronics) 435,000 3,290,780
----------------
32,746,614
----------------
LUXEMBOURG 1.18%
MILLICOM INTERNATIONAL CELLULAR*
Cellular services operator
(Telecommunications) 50,000 1,662,500
SCANDINAVIAN BROADCASTING SYSTEM*
Radio and television
broadcasting company
(Media) 240,000 5,550,000
UNITED CUSTOMER MANAGEMENT
SOLUTIONS
Provider of services for the
telecommunication industry
(Telecommunications) 7,600 1,238,800
----------------
8,451,300
----------------
NETHERLANDS 1.86%
CMG
Information technology
consulting (Computer and
Business Services) 346,100 $ 8,050,857
KONINKLIJKE (ROYAL)
PHILIPS ELECTRONICS
Manufacturer of consumer
and industrial electronics
(Electronics) 100,000 5,326,617
----------------
13,377,474
----------------
SINGAPORE 2.44%
CREATIVE TECHNOLOGIES
Provider of PCaudio products
(Computer Hardware/
Peripherals) 500,000 7,046,876
VENTURE MANUFACTURING
Contract manufacturer
for the electronics industry
(Electronics) 3,143,000 10,454,081
----------------
17,500,957
----------------
SOUTH KOREA 0.14%
SAMSUNG ELECTRONICS (GDRS)
(1U2 NON-VOTING)*+
Manufacturer of consumer
electronics and semiconductors
(Semiconductors) 60,000 528,000
SK TELECOM GROUP (ADRS)
Provider of mobile
telecommunication and
paging services
(Telecommunications) 50,000 515,625
----------------
1,043,625
----------------
SWEDEN 2.39%
L.M. ERICSSON TELEFON (ADRS)
Manufacturer of
telecommunication
equipment (Networking/
Communications Infrastructure) 100,000 2,239,844
L.M. ERICSSON TELEFON (SERIES B)
Manufacturer of
telecommunication
equipment (Networking/
Communications
Infrastructure) 148,950 3,363,295
- ----------------
See footnotes on page 62.
57
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
SWEDEN (CONTINUED)
PHARMACIA & UPJOHN
Global pharmaceutical and
biotechnology company
(Medical Products and
Technology) 100,000 $ 5,118,994
WM-DATA (SERIES B)
Provider of systems design and
development services for the
computer industry (Computers
and Business Services) 176,900 6,445,519
----------------
17,167,652
----------------
SWITZERLAND 1.51%
NOVARTIS
Manufacturer of
pharmaceuticals (Medical
Products and Technology) 6,000 10,834,012
----------------
TAIWAN 1.92%
ACCTON TECHNOLOGY (GDRS)
Distributor of electronic
components (Distribution) 599,109 1,725,434
SILICONWARE PRECISION
INDUSTRIES (GDRS)*
Integrated circuit packaging
(Electronics Capital
Equipment) 542,780 5,753,468
SYNNEX TECHNOLOGY
INTERNATIONAL (GDRS)*
Manufacturer of PCs and
peripherals (Computer
Hardware/Peripherals) 287,968 4,356,956
YAGEO (GDRS)*
Manufacturer of passive
components (Electronics) 291,228 1,915,319
YAGEO (GDRS)*+
Manufacturer of passive
components (Electronics) 8,372 55,060
----------------
13,806,237
----------------
UNITED KINGDOM 10.87%
ACORN GROUP*
Supplier of information
technology (Computer
Hardware/Peripherals) 535,800 596,280
UNITED KINGDOM (CONTINUED)
ADMIRAL
Computer software and
services (Computer and
Business Services) 530,100 $ 8,560,731
ANITE GROUP*
Supplier of data communication
and software products
(Networking/Communications
Infrastructure) 400,000 354,782
BTG
Technology transfer
company assisting in the
commercialization of
technological inventions
(Computer and
Business Services) 585,000 3,255,167
CABLE & WIRELESS
Provider of telecommunication
services (Telecommunications) 424,000 4,778,914
CELLTECH*
Pharmaceutical company
active in the development
and research of new
therapeutic products
(Medical Products and
Technology) 176,600 1,078,721
COLT TELECOM GROUP*
Provider of telecommunication
services (Telecommunications) 480,000 6,072,797
CRT GROUP
Provider of training and
recruitment services;
publisher of multimedia
products (Computer and
Business Services) 900,000 2,583,047
DRUID
Provider of consulting services
for information technology
management (Computer and
Business Services) 237,500 3,885,135
EIDOS*
Developer of entertainment
software (Computer Software) 242,000 3,361,392
GENERAL ELECTRIC
Supplier of diversified
electronics (Electronics) 1,035,000 8,270,646
- ----------------
See footnotes on page 62.
58
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
UNITED KINGDOM (CONTINUED)
ILION GROUP++
Networking equipment
distributor (Distribution) 1,616,914 $ 1,447,659
LINX PRINTING TECHNOLOGIES++
Manufacturer of specialized
printers (Miscellaneous) 570,000 1,096,979
LOGICA
Supplier of computer
services (Computer
and Business Services) 201,000 6,786,335
MISYS
Provider of computer
services, and software
and hardware solutions
(Computer Software) 601,700 4,198,960
PREMIER FARNELL
Distributor of electronic
components (Distribution) 475,000 1,331,478
PSION
Manufacturer of hand-held
computers (Computer
Hardware/Peripherals) 527,900 4,408,369
RM
Supplier of integrated
information technology
solutions to educational
markets (Networking/
Communication
Infrastructure) 1,400,000 8,375,868
TOROTRAK*
Designer and developer of
automobile transmission
systems (Machinery and
Equipment) 585,000 993,682
VODAFONE
Cellular services operator
(Telecommunications) 500,000 6,673,081
----------------
78,110,023
----------------
UNITED STATES 52.46%
3DO*
Developer of entertainment
software (Computer Software) 400,000 1,262,500
ACTIVISION*
Developer of entertainment
software (Computer Software) 253,400 2,700,294
UNITED STATES (CONTINUED)
AMDOCS*
Provider of software solutions
for the telecommunication
industry (Computer Software) 200,000 $ 2,600,000
AMKOR TECHNOLOGY*
Provider of semiconductor
packaging and test services
(Semiconductors) 1,000,000 4,890,625
APEX PC SOLUTIONS*
Developer and marketer of
switching systems for computer
network administrators
(Computer Hardware/
Peripherals) 250,000 6,515,625
AUTODESK
Developer of software for
architectural and mechanical
design, data management,
and mapping (Computer
Software) 300,000 9,403,125
C-CUBE MICROSYSTEMS*
Provider of digital video
compression and
decompression circuits and
systems (Semiconductors) 278,100 5,005,800
CADENCE DESIGN SYSTEM*
Manufacturer of electronic
design automation software
(Computer Software) 400,000 8,550,000
CHS ELECTRONICS*
Distributor of personal
computers, networking
products, and software
(Electronics) 300,000 2,925,000
CMP MEDIA (CLASS A)*++
Technology-oriented magazine
and newspaper publisher
(Media) 800,000 7,800,000
COGNEX*
Manufacturer of machine
vision systems (Electronics
Capital Equipment) 300,000 4,659,375
CREDENCE SYSTEMS*
Manufacturer of automated
semiconductor test
equipment (Electronics
Capital Equipment) 215,000 3,211,562
- ----------------
See footnotes on page 62.
59
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
UNITED STATES (CONTINUED)
DALLAS SEMICONDUCTOR
Manufacturer of mixed signal
integrated circuits
(Semiconductors) 150,000 $ 5,550,000
DATA GENERAL*
Provider of computer systems
such as servers and storage
devices (Computer
Hardware/Peripherals) 60,000 1,020,000
DII GROUP*
Provider of contract
manufacturing services
(Contract Manufacturing/
Circuit Boards) 400,000 5,875,000
DSP COMMUNICATIONS
Developer of chipsets used in
wireless communication
handsets (Networking/
Communications Infrastructure) 300,000 2,943,750
ECHELON*
Provider of software products
and services used in the design
of computer networks
(Computer Software) 600,000 1,556,250
ELECTRO SCIENTIFIC INDUSTRIES*
MANUFACTURER OF MEMORY CIRCUIT
REPAIR SYSTEMS (ELECTRONICS
CAPITAL EQUIPMENT) 100,000 2,506,250
ELECTRONIC ARTS*
Developer of entertainment
software (Computer Software) 350,000 14,350,000
ELECTRONICS FOR IMAGING*
Manufacturer of peripherals for
color printers and copiers
(Computer Hardware/
Peripherals) 300,000 7,228,125
EMC*
Manufacturer of enterprise
storage devices (Computer
Hardware/Peripherals) 500,000 32,187,500
UNITED STATES (CONTINUED)
FIRST DATA
Information processor of credit
and debit card, check, wire, and
Internet transactions (Computer
and Business Services) 150,000 $ 3,975,000
FLEXTRONICS INTERNATIONAL*
Contract manufacturer of
electronic components
(Contract Manufacturing/
Circuit Boards) 100,000 5,196,875
GENESYS TELECOMMUNICATIONS
LABORATORIES*
Provider of software for
integrating computer resources
with telephony and
telecommunication media
(Computer Software) 250,000 6,593,750
HADCO*
Manufacturer of complex
printed circuit boards
(Contract Manufacturing/
Circuit Boards) 89,700 2,808,731
HNC SOFTWARE*
Developer and vendor of
software for mission-critical
decision applications
(Computer Software) 300,000 10,087,500
JABIL CIRCUIT*
Contract manufacturer of
electronic components
(Contract Manufacturing/
Circuit Boards) 100,000 4,631,250
KLA-TENCOR*
Manufacturer of wafer inspection
and metrology equipment
(Electronics Capital
Equipment) 240,600 8,879,644
LATTICE SEMICONDUCTOR*
Designer and manufacturer of
programmable logic devices
(Semiconductors) 150,000 5,109,375
- ----------------
See footnotes on page 62.
60
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
UNITED STATES (CONTINUED)
THE LEARNING COMPANY*
Developer of education and
reference software for
the PC (Computer Software) 600,000 $ 15,487,500
LEVEL ONE COMMUNICATIONS*
Developer of silicon
connectivity solutions used in
high-speed communication
applications (Semiconductors) 175,000 4,610,156
LEXMARK INTERNATIONAL GROUP
(CLASS A)*
Manufacturer of laser and
inkjet printers and cartridges
(Computer Hardware/
Peripherals) 250,000 17,484,375
MAXIM INTEGRATED PRODUCTS*
MANUFACTURER OF LINEAR AND
MIXED-SIGNAL INTEGRATED
CIRCUITS (SEMICONDUCTORS) 485,000 17,293,281
MICROCHIP TECHNOLOGY*
Supplier of field programmable
microcontrollers
(Semiconductors) 362,500 9,832,812
MICROSOFT*
Provider of computer software
products (Computer Software) 150,000 15,885,938
NEOMAGIC*
Developer of graphics circuits
for notebook computers
(Semiconductors) 300,000 5,034,375
NETWORK ASSOCIATES*
Supplier of network security
and anti-virus utilities
(Computer Software) 400,811 17,046,993
NTL*
Provider of cable television,
Internet access, and telephone
services (Telecommunications) 45,000 2,157,188
PACIFIC GATEWAY EXCHANGE*
International telecommunication
carrier (Telecommunications) 75,000 2,175,000
PARAMETRIC TECHNOLOGY*
Developer of mechanical
design software
(Computer Software) 400,000 6,662,500
UNITED STATES (CONTINUED)
PLATINUM TECHNOLOGY*
Provider of systems
management software
(Computer Software) 400,000 $ 6,550,000
RENAISSANCE WORLDWIDE*
Provider of information
technology consulting and
services (Computer and
Business Services) 58,000 546,469
SCI SYSTEMS*
Manufacturer of electronic
components (Contract
Manufacturing/Circuit Boards) 200,000 7,900,000
SMART MODULAR TECHNOLOGY*
Assembler of memory modules
(Contract Manufacturing/
Circuit Boards) 211,700 4,425,853
SPLASH TECHNOLOGY*
Manufacturer of peripherals
for color printers and
copiers (Computer
Hardware/Peripherals) 200,000 1,712,500
STORAGE TECHNOLOGY*
Designer and manufacturer
of tape- and disk-based
data storage equipment
(Computer Hardware/
Peripherals) 300,000 10,031,250
STRUCTURAL DYNAMICS RESEARCH*
Developer of mechanical
design software
(Computer Software) 400,000 5,800,000
SYNOPSYS*
Developer of integrated
circuit design software
(Computer Software) 390,000 17,610,937
TELE-COMMUNICATIONS*
INVESTMENT COMPANY
WHICH HAS STAKES IN
INTERNATIONAL CABLE, INTERNET,
AND TELEPHONE VENTURES
(TELECOMMUNICATIONS) 100,000 4,206,250
- ----------------
See footnotes on page 62.
61
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1998
Seligman Henderson Global Technology Fund
SHARES VALUE
----------- ------------
UNITED STATES (CONTINUED)
TELE-COMMUNICATIONS (SERIES A)
TCI VENTURES GROUP*
Investment company
which has stakes in
international cable, Internet,
and telephone ventures
(Telecommunications) 200,000 $ 3,718,750
TERADYNE*
Manufacturer of semiconductor
test equipment (Electronics
Capital Equipment) 150,000 4,875,000
VEECO INSTRUMENTS*
Ion beam etching and surface
measurement systems for disk
drive heads (Electronics
Capital Equipment) 400,000 11,912,500
UNITED STATES (CONTINUED)
ZIFF-DAVIS*
Integrated media and
marketing company focused
on computer and
Internet-related technology
(Media) 600,000 $ 3,975,000
----------------
376,957,533
----------------
TOTAL INVESTMENTS 93.95%
(Cost $612,547,701) 675,071,480
OTHER ASSETS
LESS LIABILITIES 6.05% 43,486,986
----------------
NET ASSETS 100.00% $718,558,466
================
- ---------------------
* Non-income producing security.
+ Rule 144A security.
++ Affiliated issuers (a Series' holdings representing 5% or more of the
outstanding voting securities).
Descriptions of companies have not been audited by Deloitte & Touche LLP.
See Notes to Financial Statements.
62
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
OCTOBER 31, 1998
<TABLE>
<CAPTION>
EMERGING GLOBAL GLOBAL
MARKETS GROWTH SMALLER GLOBAL
INTERNATIONAL GROWTH OPPORTUNITIES COMPANIES TECHNOLOGY
FUND FUND FUND FUND FUND
------------- --------- ------------- --------- ----------
ASSETS:
Investments, at value (see portfolios of investments):
<S> <C> <C> <C> <C> <C>
Common stocks* $84,360,125 $50,799,845 $170,215,581 $779,737,667 $675,071,480
Preferred stocks -- -- -- 5,579,390 --
Bonds 258,994 113,255 151,485 1,796,709 --
Short-Term Holdings -- -- -- 10,000,000 --
------------ ------------ ------------- ------------ ------------
Total investments 84,619,119 50,913,100 170,367,066 797,113,766 675,071,480
Cash 10,246,667 5,058,919 12,228,659 51,709,455 99,703,592
Receivable for securities sold 3,888,299 950,839 4,922,023 9,213,807 123,892,223
Receivable for dividends and interest 221,478 83,462 414,492 2,976,010 638,928
Unrealized appreciation on forward
currency contracts 169,261 227 511,396 1,516,570 2,699
Receivable for Capital Stock sold 106,422 194,064 200,548 36,843,752 461,053
Expenses prepaid to shareholder service agent 41,369 46,146 81,755 390,098 340,556
Other 8,337 1,360 11,487 13,951 11,946
------------ ------------ ------------- ------------ ------------
TOTAL ASSETS 99,300,952 57,248,117 188,737,426 899,777,409 900,122,477
------------ ------------ ------------- ------------ ------------
LIABILITIES:
Payable for securities purchased 6,199,043 2,881,200 1,494,232 15,364,349 172,405,446
Unrealized depreciation on forward
currency contracts 1,095,511 229 1,938,502 8,607,015 3,024,358
Payable for Capital Stock repurchased 337,880 212,650 620,470 3,720,961 4,782,592
Accrued expenses, taxes, and other 227,186 161,773 363,850 1,707,230 1,351,615
------------ ------------ ------------- ------------ ------------
TOTAL LIABILITIES 7,859,620 3,255,852 4,417,054 29,399,555 181,564,011
------------ ------------ ------------- ------------ ------------
NET ASSETS $91,441,332 $53,992,265 $184,320,372 $870,377,854 $718,558,466
============ ============ ============= ============ ============
COMPOSITION OF NET ASSETS:
Capital Stock, at par:
Class A $ 2,485 $ 4,689 $ 10,177 $ 26,572 $ 38,147
Class B 581 3,151 2,334 16,531 4,889
Class D 2,215 2,683 6,857 20,273 15,383
Additional paid-in capital 76,821,391 81,760,173 137,061,431 860,146,972 658,974,176
Accumulated net investment loss (12,108) (1,573) (3,088) (11,300) (7,955)
Undistributed/accumulated net realized gain
(loss) on investments 955,012 (22,888,498) 387,169 (18,059,913) --
Net unrealized appreciation (depreciation)
of investments 11,559,751 (2,995,488) 46,926,669 30,703,189 62,135,589
Net unrealized appreciation (depreciation) on
translation of assets and liabilities denominated in
foreign currencies and forward currency contracts 2,112,005 (1,892,872) (71,177) (2,464,470) (2,601,763)
------------ ------------ ------------- ------------ ------------
Net Assets $91,441,332 $53,992,265 $184,320,372 $870,377,854 $718,558,466
============ ============ ============= ============ ============
NET ASSETS:
Class A $44,121,550 $24,293,781 $ 97,947,090 $374,889,859 $475,951,535
Class B $ 9,834,634 $16,031,000 $ 21,930,546 $222,495,651 $ 58,575,177
Class D $37,485,148 $13,667,484 $ 64,442,736 $272,992,344 $184,031,754
SHARES OF CAPITAL STOCK OUTSTANDING:
Class A 2,485,160 4,688,726 10,177,460 26,572,416 38,147,171
Class B 580,881 3,150,752 2,333,634 16,530,974 4,889,211
Class D 2,214,767 2,683,562 6,856,670 20,272,979 15,382,625
NET ASSET VALUE PER SHARE:
Class A $17.75 $5.18 $9.62 $14.11 $12.48
Class B $16.93 $5.09 $9.40 $13.46 $11.98
Class D $16.93 $5.09 $9.40 $13.47 $11.96
</TABLE>
- ---------------
* Includes affiliated issuers (issuers in which a Series' holdings representing
5% or more of the outstanding voting securities) with cost of $14,649,952 and
$32,880,883, and value of $17,230,342 and $17,594,638, respectively, for the
Global Smaller Companies Fund and the Global Technology Fund. See Notes to
Financial Statements.
63
<PAGE>
STATEMENTS OF OPERATIONS
For the Year Ended October 31, 1998
<TABLE>
<CAPTION>
EMERGING GLOBAL GLOBAL
MARKETS GROWTH SMALLER GLOBAL
INTERNATIONAL GROWTH OPPORTUNITIES COMPANIES TECHNOLOGY
FUND FUND FUND FUND FUND
------------- --------- ------------- --------- ----------
INVESTMENT INCOME:
<S> <C> <C> <C> <C> <C>
Dividends* $1,617,890 $ 1,293,774 $ 2,110,427 $10,598,335 $3,025,877
Interest 189,181 440,815 266,884 1,327,988 2,171,660
------------ ------------ ----------- ------------ ------------
Total Investment Income** 1,807,071 1,734,589 2,377,311 11,926,323 5,197,537
------------ ------------ ----------- ------------ ------------
EXPENSES:
Management fees 954,634 1,034,015 1,982,193 9,995,944 8,247,297
Distribution and service fees 590,772 553,783 1,151,017 6,917,745 4,116,934
Shareholder account services 226,490 311,815 501,782 2,563,167 2,184,002
Custody and related services 121,639 118,489 147,188 687,842 452,718
Registration 67,351 59,269 58,836 115,240 126,018
Auditing and legal fees 53,425 56,583 53,654 55,432 55,023
Shareholder reports and communications 40,295 39,960 85,258 526,267 611,333
Directors' fees and expenses 16,325 17,801 21,713 79,122 53,855
Miscellaneous 6,270 5,996 10,647 37,152 30,873
------------ ------------ ----------- ------------ ------------
Total Expenses 2,077,201 2,197,711 4,012,288 20,977,911 15,878,053
------------ ------------ ----------- ------------ ------------
Net Investment Loss (270,130) (463,122) (1,634,977) (9,051,588) (10,680,516)
------------ ------------ ----------- ------------ ------------
NET REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS:
Net realized gain (loss) on investments*** 2,327,950 (17,519,924) 2,512,281 142,339 47,415,066
Net realized loss from foreign currency
transactions*** (700,001) (2,152,860) (2,270,172) (16,429,116) (858,280)
Net change in unrealized appreciation
of investments 1,271,316 (5,035,191) 13,049,405 (51,038,110) (44,894,952)
Net change in unrealized depreciation on
translation of assets and liabilities denominated
in foreign currencies and forward
currency contracts 2,794,538 370,569 3,910,046 19,214,602 5,026,539
------------ ------------ ----------- ------------ ------------
Net Gain (Loss) on Investments and Foreign
Currency Transactions 5,693,803 (24,337,406) 17,201,560 (48,110,285) 6,688,373
------------ ------------ ----------- ------------ ------------
Increase (Decrease) in Net Assets
from Operations $5,423,673 $(24,800,528) $15,566,583 $(57,161,873) $(3,992,143)
============ ============ =========== ============ ===========
- ----------------
* Includes dividend income from affiliated issuers
as follows: -- -- -- -- $ 79,847
** Net of foreign taxes withheld as follows: $169,723 $105,168 $165,219 $1,184,791 443,373
*** Includes net realized gain (loss) (including effect
of foreign currency transactions) from affiliated
issuers as follows: -- -- -- 4,380,273 (683,067)
See Notes to Financial Statements.
</TABLE>
Statements of Changes in Net Assets
64
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL EMERGING MARKETS
FUND GROWTH FUND
------------------------------ --------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31,
------------------------------ --------------------------------
1998 1997 1998 1997
-------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment loss ................................. $ (270,130) $ (634,722) $ (463,122) $ (882,224)
Net realized gain (loss) on investments ............. 2,327,950 12,612,987 (17,519,924) (148,704)
Net realized loss from foreign currency transactions (700,001) (6,357,450) (2,152,860) (2,880,868)
Net change in unrealized appreciation/depreciation
of investments ................................. 1,271,316 1,745,746 (5,035,191) 2,540,710
Net change in unrealized depreciation on translation
of assets and liabilities denominated in foreign
currencies and forward currency contracts ...... 2,794,538 1,928,031 370,569 (1,858,237)
------------- ------------- ------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ... 5,423,673 9,294,592 (24,800,528) (3,229,323)
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gain on investments:
Class A ........................................... (3,073,832) (2,600,409) -- --
Class B ........................................... (442,506) (155,283 -- --
Class D ........................................... (2,927,252) (2,512,690) -- --
------------- ------------- ------- ----- -------------
Decrease in Net Assets from Distributions ........... (6,443,590) (5,268,382) -- --
------------- ------------- ------------- -------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sale of shares:
Class A ........................................... 20,944,419 8,433,918 9,097,908 24,772,191
Class B ........................................... 4,648,002 3,830,342 3,958,564 21,632,060
Class D ........................................... 6,404,661 7,260,659 3,323,782 16,452,673
Exchanged from associated Funds:
Class A ........................................... 51,542,834 42,509,534 19,937,244 32,454,783
Class B ........................................... 5,569,000 546,088 477,703 3,193,456
Class D ........................................... 31,181,338 17,279,201 2,593,655 18,323,632
Shares issued in payment of gain distributions:
Class A ........................................... 2,644,650 1,907,643 -- --
Class B ........................................... 416,868 145,807 -- --
Class D ........................................... 2,517,142 2,266,472 -- --
------------- ------------- ------------- -------------
Total ............................................... 125,868,914 84,179,664 39,388,856 116,828,795
------------- ------------- ------------- -------------
Cost of shares repurchased:
Class A ........................................... (24,740,448) (16,889,634) (12,803,905) (12,525,580)
Class B ........................................... (999,582) (285,808) (4,804,465) (2,633,033)
Class D ........................................... (9,945,313) (13,972,244) (6,863,680) (4,107,703)
Exchanged into associated Funds:
Class A ........................................... (52,470,373) (43,254,302) (25,474,706) (19,719,002)
Class B ........................................... (5,611,693) (811,812) (4,852,353) (2,336,033)
Class D ........................................... (33,074,289) (21,316,046) (9,935,797) (12,208,736)
------------- ------------- ------------- -------------
Total ............................................... (126,841,698) (96,529,846) (64,734,906) (53,530,087)
------------- ------------- ------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ..................... (972,784) (12,350,182) (25,346,050) 63,298,708
------------- -------------
INCREASE (DECREASE) IN NET ASSETS ................... (1,992,701) (8,323,972) (50,146,578) 60,069,385
NET ASSETS:
Beginning of year ................................... 93,434,033 101,758,005 104,138,843 44,069,458
------------- ------------- ------------- -------------
END OF YEAR ......................................... $ 91,441,332 $ 93,434,033 $ 53,992,265 $ 104,138,843
============== ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
GLOBAL GROWTH
OPPORTUNITIES FUND
-----------------------------
YEAR ENDED OCTOBER 31,
------------------------------
1998 1997
-------------- -------------
<S> <C> <C>
OPERATIONS:
Net investment loss ................................. $ (1,634,977) $ (1,712,413)
Net realized gain (loss) on investments ............. 2,512,281 14,475,563
Net realized loss from foreign currency transactions (2,270,172) (5,288,647)
Net change in unrealized appreciation/depreciation
of investments ................................. 13,049,405 16,851,124
Net change in unrealized depreciation on translation
of assets and liabilities denominated in foreign
currencies and forward currency contracts ...... 3,910,046 (1,171,623)
------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ... 15,566,583 23,154,004
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gain on investments:
Class A ........................................... (4,861,075) --
Class B ........................................... (875,292) --
Class D ........................................... (2,900,851) --
------------- -------------
Decrease in Net Assets from Distributions ........... (8,637,218) --
------------- -------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sale of shares:
Class A ........................................... 7,080,116 12,893,684
Class B ........................................... 4,937,582 9,863,991
Class D ........................................... 6,765,527 11,847,943
Exchanged from associated Funds:
Class A ........................................... 29,284,180 4,188,658
Class B ........................................... 3,543,331 1,014,306
Class D ........................................... 12,674,214 5,672,140
Shares issued in payment of gain distributions:
Class A ........................................... 4,427,520 --
Class B ........................................... 752,541 --
Class D ........................................... 2,635,591 --
------------- -------------
Total ............................................... 72,100,602 45,480,722
------------- -------------
Cost of shares repurchased:
Class A ........................................... (26,372,863) (24,937,167)
Class B ........................................... (3,664,340) (1,352,960)
Class D ........................................... (15,267,156) (8,496,389)
Exchanged into associated Funds:
Class A ........................................... (30,358,305) (5,055,701)
Class B ........................................... (3,263,092) (980,251)
Class D ........................................... (8,455,082) (5,447,579)
------------- -------------
Total ............................................... (87,380,838) (46,270,047)
------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ..................... (15,280,236) (789,325)
------------- -------------
INCREASE (DECREASE) IN NET ASSETS ................... (8,350,871) 22,364,679
NET ASSETS:
Beginning of year ................................... 192,671,243 170,306,564
------------- -------------
END OF YEAR ......................................... $ 184,320,372 $ 192,671,243
============= =============
</TABLE>
- --------------
See Notes to Financial Statements.
65
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
GLOBAL SMALLER GLOBAL TECHNOLOGY
COMPANIES FUND FUND
------------------------------------ --------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31,
------------------------------------ --------------------------------
1998 1997 1998 1997
---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment loss ................................. $ (9,051,588) $ (3,884,361) $ (10,680,516) $ (11,314,644)
Net realized gain on investments .................... 142,339 48,603,936 47,415,066 160,468,225
Net realized loss from foreign
currency transactions .......................... (16,429,116) (7,015,314) (858,280) (2,395,338)
Net change in unrealized appreciation/depreciation
of investments ................................. (51,038,110) 49,634,066 (44,894,952) 83,247,639
Net change in unrealized depreciation on translation
of assets and liabilities denominated in foreign
currencies and forward currency contracts ...... 19,214,602 (18,276,737) 5,026,539 (1,868,340)
--------------- --------------- --------------- ---------------
Increase (Decrease) in Net Assets from
Operations ......................................... (57,161,873) 69,061,590 (3,992,143) 228,137,542
--------------- --------------- --------------- ---------------
Distributions to Shareholders:
Net realized gain on investments:
Class A ........................................... (17,124,087) (16,938,227) (99,536,281) --
Class B ........................................... (10,275,288) (5,226,787) (9,666,516) --
Class D ........................................... (15,357,547) (14,328,867) (41,021,514) --
--------------- --------------- --------------- ---------------
Decrease in Net Assets from Distributions ........... (42,756,922) (36,493,881) (150,224,311) --
--------------- --------------- --------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sale of shares:
Class A ........................................... 152,853,507 161,210,830 56,563,795 53,544,965
Class B ........................................... 43,401,281 160,923,469 15,204,426 30,651,040
Class D ........................................... 39,263,963 129,977,455 15,269,385 27,634,257
Exchanged from associated Funds:
Class A ........................................ 230,629,818 38,707,367 198,014,893 131,077,214
Class B ........................................... 5,918,063 8,353,794 4,387,134 7,378,122
Class D ........................................... 42,068,010 22,459,122 121,982,389 31,456,056
Shares issued in payment of gain distributions:
Class A ........................................... 15,984,486 15,752,220 93,006,394 --
Class B ........................................... 9,575,151 4,800,702 8,897,918 --
Class D ........................................... 14,283,328 13,378,106 38,405,363 --
--------------- --------------- --------------- ---------------
Total ............................................... 553, 977,607 555,563,065 551,731,697 281,741,654
--------------- --------------- --------------- ---------------
Cost of shares repurchased:
Class A ........................................... (175,015,238) (100,080,081) (137,745,943) (119,817,104)
Class B ........................................... (29,719,894) (19,743,793) (6,421,499) (4,478,196)
Class D ........................................... (89,449,184) (61,956,065) (47,125,132) (46,935,136)
Exchanged into associated Funds:
Class A ........................................... (247,200,113) (46,909,181) (216,262,283) (141,838,011)
Class B ........................................... (26,278,385) (17,273,307) (5,472,802) (6,449,635)
Class D ........................................... (68,639,834) (29,350,663) (135,114,189) (37,285,917)
--------------- --------------- --------------- ---------------
Total ............................................... (636,302,648) (275,313,090) (548,141,848) (356,803,999)
--------------- --------------- --------------- ---------------
Increase (Decrease) in Net Assets from
Capital Share Transactions ........................ (82,325,041) 280,249,975 3,589,849
--------------- --------------- --------------- ---------------
Increase (Decrease) in Net Assets ................... (182,243,836) 312,817,684 (150,626,605) 153,075,197
NET ASSETS:
Beginning of year ................................... 1,052,621,694 739,804,010 869,185,071 716,109,874
--------------- --------------- --------------- ---------------
End of Year ......................................... $ 870,377,858 $ 1,052,621,694 $ 718,558,466 $ 869,185,071
=============== =============== =============== ===============
</TABLE>
- -----------
See Notes to Financial Statements.
66
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. MULTIPLE CLASSES OF SHARES -- Seligman Henderson Global Fund Series, Inc.
(the "Fund") consists of five separate Series: Seligman Henderson International
Fund (the "International Fund"), Seligman Henderson Emerging Markets Growth Fund
(the "Emerging Markets Growth Fund"), Seligman Henderson Global Growth
Opportunities Fund (the "Global Growth Opportunities Fund"), Seligman Henderson
Global Smaller Companies Fund (the "Global Smaller Companies Fund"), and
Seligman Henderson Global Technology Fund (the "Global Technology Fund"). Each
Series of the Fund offers three classes of shares.
Class A shares are sold with an initial sales charge of up to 4.75% and a
continuing service fee of up to 0.25% on an annual basis. Class A shares
purchased in an amount of $1,000,000 or more are sold without an initial sales
charge but are subject to a contingent deferred sales charge ("CDSC") of 1% on
redemptions within 18 months of purchase. Class B shares are sold without an
initial sales charge but are subject to a distribution fee of 0.75% and a
service fee of up to 0.25% on an annual basis, and a CDSC, if applicable, of 5%
on redemptions in the first year of purchase, declining to 1% in the sixth year
and 0% thereafter. Class B shares will automatically convert to Class A shares
on the last day of the month that precedes the eighth anniversary of their date
of purchase. Class D shares are sold without an initial sales charge but are
subject to a distribution fee of up to 0.75%, and a service fee of up to 0.25%
on an annual basis, and a CDSC, if applicable, of 1% imposed on redemptions made
within one year of purchase. The three classes of shares for each Series
represent interests in the same portfolio of investments, have the same rights
and are generally identical in all respects except that each class bears its
separate distribution and certain other class expenses, and has exclusive voting
rights with respect to any matter on which a separate vote of any class is
required.
2. SIGNIFICANT ACCOUNTING POLICIES -- The financial statements have been
prepared in conformity with generally accepted accounting principles which
require management to make certain estimates and assumptions at the date of the
financial statements. The following summarizes the significant accounting
policies of the Fund:
a. SECURITY VALUATION -- Securities traded on an exchange are valued at the last
sales price on the primary exchange or market on which they are traded.
United Kingdom securities and securities for which there are no recent sales
transactions are valued based on quotations provided by primary market makers
in such securities. Other securities not listed on an exchange or security
market, or securities for which there is no last sales price, are valued at
the mean of the most recent bid and asked prices. Any securities for which
recent market quotations are not readily available are valued at fair value
determined in accordance with procedures approved by the Board of Directors.
Short-term holdings which mature in more than 60 days are valued at current
market quotations. Short-term holdings maturing in 60 days or less are valued
at amortized cost.
b. FOREIGN SECURITIES -- Investments in foreign securities will primarily be
traded in foreign currencies, and each Series may temporarily hold funds in
foreign currencies. The books and records of the Fund are maintained in US
dollars. Foreign currency amounts are translated into US dollars on the
following basis:
(i) market value of investment securities, other assets, and liabilities,
at the daily rate of exchange as reported by a pricing service;
(ii) purchases and sales of investment securities, income, and expenses,
at the rate of exchange prevailing on the respective dates of such
transactions.
The Fund's net asset values per share will be affected by changes in
currency exchange rates. Changes in foreign currency exchange rates may also
affect the value of dividends and interest earned, gains and losses realized on
sales of securities, and net investment income and gains, if any, which are to
be distributed to shareholders of the Fund. The rate of exchange between the US
dollar and other currencies is determined by the forces of supply and demand in
the foreign exchange markets.
Net realized foreign exchange gains and losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books, and the US dollar equivalents of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
value of portfolio securities and other foreign currency denominated assets and
liabilities at period end, resulting from changes in exchange rates.
67
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Fund separates that portion of the results of operations resulting from
changes in the foreign exchange rates from the fluctuations arising from changes
in the market prices of securities held in the portfolio. Similarly, the Fund
separates the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of portfolio securities sold during
the period.
c. FORWARD CURRENCY CONTRACTS -- The Fund may enter into forward currency
contracts in order to hedge its exposure to changes in foreign currency
exchange rates on its foreign portfolio holdings, or other amounts receivable
or payable in foreign currency. A forward contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. Certain risks may arise upon entering into these contracts from the
potential inability of counterparties to meet the terms of their contracts.
The contracts are valued daily at current exchange rates and any unrealized
gain or loss is included in net unrealized appreciation or depreciation on
translation of assets and liabilities denominated in foreign currencies and
forward currency contracts. The gain or loss, if any, arising from the
difference between the settlement value of the forward contract and the
closing of such contract, is included in net realized gain or loss from
foreign currency transactions.
d. FEDERAL TAXES -- There is no provision for federal income tax. Each Series
has elected to be taxed as a regulated investment company and intends to
distribute substantially all taxable net income and net gain realized, if
any, annually. Withholding taxes on foreign dividends and interest have been
provided for in accordance with the Fund's understanding of the applicable
country's tax rules and rates. e. Security Transactions and Related
Investment Income Investment transactions are recorded on trade dates.
Identified cost of investments sold is used for both financial statement and
federal income tax purposes. Dividends receivable and payable are recorded on
ex-dividend dates, except that certain dividends from foreign securities
where the ex-dividend dates may have passed are recorded as soon as the Fund
is informed of the dividends. Interest income is recorded on an accrual
basis.
f. MULTIPLE CLASS ALLOCATIONS -- All income, expenses (other than class-specific
expenses), and realized and unrealized gains or losses are allocated daily to
each class of shares based upon the relative value of shares of each class.
Class-specific expenses, which include distribution and service fees and any
other items that are specifically attributed to a particular class, are
charged directly to such class.
g. DISTRIBUTIONS TO SHAREHOLDERS -- The treatment for financial statement
purposes of distributions made to shareholders during the year from net
investment income or net realized gains may differ from their ultimate
treatment for federal income tax purposes. These differences primarily are
caused by differences in the timing of the recognition of certain components
of income, expense, or realized capital gain; and the recharacterization of
foreign exchange gains or losses to either ordinary income or realized
capital gains for federal income tax purposes. Where such differences are
permanent in nature, they are reclassified in the components of net assets
based on their ultimate characterization for federal income tax purposes. Any
such reclassifications will have no effect on net assets, results of
operations, or net asset value per share of the Fund.
For the year ended October 31, 1998, the Global Technology Fund redeemed
42,108,514 of its shares from shareholders aggregating $548,141,848 of which
approximately $22,600,000 represents capital gain distributions. This
information is provided for federal income tax purposes only.
On November 18, 1998, a distribution of $0.158 per share, aggregating
$9,093,102, was declared from net realized long-term gains from investment
transactions for the Global Technology Fund. The capital gain was paid on
November 23, 1998, to shareholders of record on November 18, 1998.
3. PURCHASES AND SALES OF SECURITIES -- Purchases and sales of portfolio
securities, excluding short-term investments, for the year ended October 31,
1998, were as follows:
SERIES PURCHASES SALES
- -------------------- ------------- --------------
International Fund $ 74,353,775 $ 85,421,336
Emerging Markets
Growth Fund 69,700,870 80,785,932
Global Growth
Opportunities Fund 86,868,064 118,986,574
Global Smaller
Companies Fund 492,779,712 693,548,503
Global Technology Fund 688,465,629 862,522,906
68
<PAGE>
NOTES TO FINANCIAL STATEMENTS
At October 31, 1998, the cost of investments for federal income tax
purposes was substantially the same as the cost for financial reporting
purposes, and the tax basis gross unrealized appreciation and depreciation of
portfolio securities, including the effects of foreign currency translations,
were as follows:
TOTAL TOTAL
UNREALIZED UNREALIZED
SERIES APPRECIATION DEPRECIATION
- ----------------------- ------------- -------------
International Fund $ 16,433,547 $ 1,837,759
Emerging Markets
Growth Fund 6,137,469 11,028,879
Global Growth
Opportunities Fund 51,939,755 3,668,839
Global Smaller
Companies Fund 135,382,787 102,987,503
Global Technology Fund 135,065,742 85,736,896
4. MANAGEMENT FEE, DISTRIBUTION SERVICES, AND OTHER TRANSACTIONS -- J. & W.
Seligman & Co. Incorporated (the "Manager") manages the affairs of the Fund and
provides or arranges for the necessary personnel and facilities. The Manager
receives a fee, calculated daily and payable monthly, equal to 1.25% per annum
of the average daily net assets of the Emerging Markets Growth Fund and 1.00%
per annum of each of the other Series' average daily net assets. Prior to July
1, 1998, Seligman Henderson Co., an entity owned 50% each by the Manager and
Henderson International, Inc., a subsidiary of Henderson plc, supervised and
directed the Fund's global investments pursuant to subadvisory agreements with
the Manager. Under the subadvisory agreements, the Manager paid Seligman
Henderson Co. 1.15% per annum of the average daily net assets of the Emerging
Markets Growth Fund and 0.90% per annum of each of the other Series' average
daily net assets.
On March 30, 1998, AMP Limited, an Australian life insurance and financial
services company, completed an acquisition of Henderson plc, which resulted in
the termination of the Fund's subadvisory agreements. The Fund's Board of
Directors approved interim subadvisory agreements pursuant to which Seligman
Henderson Co. continued to supervise and direct the Fund's global investments.
The Fund's directors also approved a proposed new subadvisory agreement pursuant
to which Henderson Investment Management Limited (the "Subadviser"), a
wholly-owned subsidiary of Henderson plc, would replace Seligman Henderson Co.
as subadviser to theFund and be responsible for furnishing investment advice,
research and assistance with respect to the Fund's international investments.
Under the new agreement, the Manager is responsible for the Fund's US
investments and has overall responsibility for management of the Fund. Both the
interim and the new subadvisory agreements were approved by vote of the
shareholders of the Fund on June 30, 1998. Under the new subadvisory agreement,
the Manager pays the Subadviser a subadvisory fee for each Series at a rate of
0.90% per annum of the average monthly assets under the Subadviser's
supervision.
Compensation of all officers of the Fund, all directors of the Fund who are
employees or consultants of the Manager, and all personnel of the Fund and the
Manager is paid by the Manager or by Henderson plc.
Seligman Advisors, Inc. (the "Distributor") (formerly Seligman Financial
Services, Inc.), agent for the distribution of each Series' shares, and an
affiliate of the Manager, received concessions after commissions were paid to
dealers for sales of Class A shares as follows:
DISTRIBUTOR DEALER
SERIES CONCESSIONS COMMISSIONS
- ----------------------- --------------- ---------------
International Fund $13,622 $104,107
Emerging Markets
Growth Fund 11,459 89,616
Global Growth
Opportunities Fund 19,994 156,963
Global Smaller
Companies Fund 94,085 753,981
Global Technology Fund 121,127 978,251
Each Series of the Fund has an Administration, Shareholder Services and
Distribution Plan (the "Plan") with respect to distribution of its shares. Under
the Plan, with respect to Class A shares, service organizations can enter into
agreements with the Distributor and receive a continuing fee of up to 0.25% on
an annual basis, payable quarterly, of the average daily net assets of the Class
A shares attributable to the particular service organizations for providing
personal services and/or the maintenance of shareholder accounts. The
Distributor charges such fees to the Fund pursuant to the Plan. For the year
ended October 31, 1998, fees incurred by the International Fund, the Emerging
Markets Growth Fund, the Global Growth Opportunities Fund, the Global Smaller
Companies Fund, and the Global Technology Fund aggregated $97,702, $80,916,
$261,123, $982,147, and $1,334,768, respectively, or 0.21%, 0.23%, 0.24%, 0.24%,
and 0.24%, respectively, per annum of the average daily net assets of Class A
shares.
Under the Plan, with respect to Class B and Class D shares, service
organizations can enter into agreements with the Distributor and receive a
continuing fee for providing personal
69
<PAGE>
NOTES TO FINANCIAL STATEMENTS
services and/or the maintenance of shareholder accounts of up to 0.25% on an
annual basis of the average daily net assets of the Class B and Class D shares
for which the organizations are responsible; and, for Class D shares
only, fees for providing other distribution assistance of up to 0.75% on an
annual basis of such average daily net assets. Such fees are paid monthly by the
Fund to the Distributor pursuant to the Plan.
With respect to Class B shares, a distribution fee of 0.75% on an annual
basis of average daily net assets is payable monthly by the Fund to the
Distributor; however, the Distributor has sold its rights to substantially all
of this fee to a third party (the "Purchaser"), which provides funding to the
Distributor to enable it to pay commissions to dealers at the time of the sale
of the related Class B shares.
For the year ended October 31, 1998, fees incurred under the Plan,
equivalent to 1% per annum of the average daily net assets of Class B and Class
D shares, were as follows:
Series Class B Class D
- ------------------------ ----------- ----------
International Fund $ 84,989 $ 408,081
Emerging Markets
Growth Fund 242,231 230,636
Global Growth
Opportunities Fund 214,020 675,874
Global Smaller
Companies Fund 2,534,097 3,401,501
Global Technology Fund 599,016 2,183,150
The Distributor is entitled to retain any CDSC imposed on redemptions of
Class D shares occurring within one year of purchase and on certain redemptions
of Class Ashares occurring within 18 months of purchase. For the year ended
October 31, 1998, such charges were as follows:
Series Amount
- ------------- --------
International Fund $ 7,109
Emerging Markets Growth Fund 16,136
Global Growth Opportunities Fund 15,178
Global Smaller
Companies Fund 118,278
Global Technology Fund 42,732
The Distributor has sold its rights to collect any CDSC imposed on
redemptions of Class B shares to the Purchaser. In connection with the sale of
its rights to collect any CDSC and the distribution fees with respect to Class B
shares described above, the Distributor receives payments from the Purchaser
based on the value of Class B shares sold. The aggregate amounts of such
payments and the Class B shares distribution fees retained by the Distributor
for the year ended October 31, 1998, were as follows:
Series Amount
------------- --------
International Fund $ 7,600
Emerging Markets Growth Fund 8,034
Global Growth Opportunities Fund 8,743
Global Smaller Companies Fund 2,534
Global Technology Fund 28,886
Seligman Services, Inc., an affiliate of the Manager, is eligible to
receive commissions from certain sales of shares of the Fund, as well as
distribution and service fees pursuant to the Plan. For the year ended October
31, 1998, Seligman Services, Inc. received commissions from the sale of shares
of each Series and distribution and service fees, pursuant to the Plan, as
follows:
Distribution
Series Commissions and service fees
-------- --------- -------------------
nternational Fund $ 8,971 $20,727
Emerging Markets
Growth Fund 647 6,219
Global Growth
Opportunities Fund 10,047 2,295
Global Smaller
Companies Fund 45,438 11,939
Global Technology Fund 90,491 26,484
Seligman Data Corp., which is owned by certain associated investment
companies, charged at cost for shareholder account services the following
amounts:
Series Amount
- ------------------ -------------
International Fund $ 226,490
Emerging Markets Growth Fund 311,815
Global Growth Opportunities Fund 501,782
Global Smaller Companies Fund 2,563,167
Global Technology Fund 2,184,002
Certain officers and directors of the Fund are officers or directors of the
Manager, Seligman Henderson Co., the Distributor, Seligman Services, Inc.,
and/or Seligman Data Corp.
The Fund has a compensation arrangement under which directors who receive
fees may elect to defer receiving such fees. Directors may elect to have their
deferred fees accrue interest or earn a return based on the performance of the
Fund or other funds in the Seligman Group of Investment Companies. Deferred fees
and related accrued earnings are not deductible by the Fund for federal income
tax purposes until such amounts are paid. The annual cost of such fees and
earnings accrued thereon is included in directors' fees and
70
<PAGE>
expenses, and the accumulated balances thereof at October 31, 1998, are
included in other liabilities, as follows:
SERIES AMOUNT
- ------------------ ----------
International Fund $12,108
Emerging Markets GrowthFund 1,573
Global Growth Opportunities Fund 3,088
Global Smaller Companies Fund 11,300
Global Technology Fund 7,955
5. COMMITTED LINE OF CREDIT -- Effective July 1, 1998,the F und terminated its
$100 million committed line of credit and entered into a joint $800 million
committed line of credit that is shared by substantially all funds in the
Seligman Group of Investment Companies. The Fund's borrowings are limited to 5%
of its net assets. Borrowings pursuant to the credit facility are subject to
interest at a rate equal to the overnight federal funds rate plus 0.50% on an
overnight basis. The Fund incurs a commitment fee of 0.80% per annum on its
share of the unused portion of the credit facility. The credit facility may be
drawn upon only for temporary purposes and is subject to certain other customary
restrictions. The credit facility commitment expires one year from the date of
the agreement but is renewable with the consent of the participating banks. To
date, the Fund has not borrowed from the credit facility.
6. LOSS CARRYFORWARD -- In accordance with current federal income tax law, each
of the Series' net realized capital gains and losses are considered separately
for purposes of determining taxable capital gains on an annual basis. At October
31, 1998, the Emerging Markets Growth Fund, the Global Growth Opportunities
Fund, and the Global Smaller Companies Fund had net capital loss carryforwards
for federal income tax purposes of $23,269,538, $1,139,976, and $22,271,988,
respectively, which are available for offsets against future taxable capital
gains, expiring in various amounts through 2006. Accordingly, no capital gain
distributions are expected to be paid to shareholders until net capital gains
have been realized in excess of the available capital loss carryforwards.
7. AFFILIATED ISSUERS -- As defined under the Investment Company Act of 1940, as
amended, affiliated issuers are those issuers in which a Series' holdings of an
issuer represent 5% or more of the outstanding voting securities of the issuer.
A summary of the Fund's transactions in the securities of these issuers during
the year ended October 31, 1998, is as follows:
<TABLE>
<CAPTION>
GROSS GROSS SALES
Beginning PURCHASES AND Ending Realized Dividend Ending
Affiliate Shares AND ADDITIONS REDUCTIONS Shares Gain (LOSS) Income Value
- ----------- ------------ -------------- ----------- ----------- -------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
GLOBAL SMALLER
COMPANIES FUND
Bon Appetit Holding .. 12,353 -- 4,357 7,996 $ 793,929 -- $ 4,420,197
La Doria ............. 2,252,166 41,925 608,000 1,686,091 (422,782) -- 5,922,433
L'Europeenne
d'Extincteurs ...... 142,402 -- 10,177 132,225 67,359 -- 6,887,712
FactSet Research
Systems ........... 500,000 -- 500,000 -- 5,467,036 -- --
Simon Transportation
Services ........... 270,000 -- 270,000 -- (1,525,269) -- --
----------- ----------- -----------
$ 4,380,273* -- $17,230,342
=========== =========== ===========
GLOBAL TECHNOLOGY FUND
CMP Media (Class A) .. 700,000 187,400 87,400 800,000 $ (683,067) -- $ 7,800,000
IlionGroup ........... 1,616,914 -- -- 1,616,914 -- $ 63,699 1,447,659
Linx Printing
Technologies .... 570,000 -- -- 570,000 -- 16,148 1,096,979
Tecnomatix
Technologies .... -- 500,000 -- 500,000 -- -- 7,250,000
----------- ----------- -----------
$ (683,067) $ 79,847 $17,594,638
=========== =========== ===========
</TABLE>
- ---------------
*Includes net realized loss from foreign currency transactions of $348,058.
71
<PAGE>
NOTES TO FINANCIAL STATEMENTS
8. CAPITAL STOCK SHARE TRANSACTIONS -- The Fund has 2,000,000,000 shares of
Capital Stock authorized. The Board of Directors, at its discretion, may
classify any unissued shares of Capital Stock among any Series of the Fund. At
October 31, 1998, 400,000,000 shares were authorized for each Series of the
Fund, all at a par value of $.001 per share.
<TABLE>
<CAPTION>
INTERNATIONAL EMERGING MARKETS GLOBAL GROWTH
FUND GROWTH FUND OPPORTUNITIES FUND
------------------------ ------------------------- ---------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31,
------------------------ ------------------------- ---------------------------
1998 1997 1998 1997 1998 1997
----------- ----------- ---------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Sale of shares:
Class A ..................................... 1,132,123 469,762 1,325,518 2,993,423 701,595 1,449,286
Class B ..................................... 250,816 219,118 570,569 2,612,415 498,253 1,123,386
Class D ..................................... 355,632 418,939 486,492 2,012,007 682,270 1,356,808
Exchanged from associated Funds:
Class A ..................................... 2,810,206 2,324,501 3,141,179 4,057,896 2,882,396 476,273
Class B ..................................... 297,215 30,506 72,054 391,346 358,767 110,609
Class D ..................................... 1,774,064 987,349 406,998 2,226,146 1,270,285 649,300
Shares issued in payment of gain distributions:
Class A ..................................... 162,848 112,811 -- -- 500,843 --
Class B ..................................... 26,671 8,858 -- -- 86,294 --
Class D ..................................... 161,046 137,696 -- -- 302,772 --
----------- ----------- ----------- ----------- ----------- -----------
Total ......................................... 6,970,621 4,709,540 6,002,810 14,293,233 7,283,475 5,165,662
----------- ----------- ----------- ----------- ----------- -----------
Shares repurchased:
Class A ..................................... (1,349,489) (966,373) (1,916,244) (1,498,674) (2,727,222) (2,814,964)
Class B ..................................... (58,028) (15,472) (720,647) (312,134) (387,874) (147,394)
Class D ..................................... (568,487) (822,399) (1,033,695) (502,678) (1,596,162) (965,125)
Exchanged into associated Funds:
Class A ..................................... (2,842,925) (2,337,951) (3,863,525) (2,482,147) (3,027,589) (568,846)
Class B ..................................... (302,774) (45,879) (737,349) (284,989) (352,291) (110,456)
Class D ..................................... (1,875,479) (1,216,560) (1,478,158) (1,454,997) (895,935) (626,078)
----------- ----------- ----------- ----------- ----------- -----------
Total ......................................... (6,997,182) (5,404,634) (9,749,618) (6,535,619) (8,987,073) (5,232,863)
----------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in shares ................. (26,561) (695,094) (3,746,808) 7,757,614 (1,703,598) (67,201)
=========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
GLOBAL SMALLER GLOBAL TECHNOLOGY
COMPANIES FUND FUND
-------------------------- --------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31,
-------------------------- ---------------------------
1998 1997 1998 1997
----------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
Sale of shares:
Class A ..................................... 10,022,623 10,709,397 4,176,254 3,700,869
Class B ..................................... 2,848,299 11,006,362 1,176,951 2,147,619
Class D ..................................... 2,596,605 8,914,612 1,189,506 1,953,820
Exchanged from associated Funds:
Class A ..................................... 14,424,445 2,567,331 15,149,055 9,603,055
Class B ..................................... 401,071 578,628 357,448 599,186
Class D ..................................... 2,673,250 1,545,821 9,576,218 2,118,807
Shares issued in payment of gain distributions:
Class A ..................................... 1,085,903 1,069,396 7,189,429 --
Class B ..................................... 677,168 335,948 710,545 --
Class D ..................................... 1,009,423 936,187 3,070,660 --
----------- ----------- ----------- -----------
Total ......................................... 35,738,787 37,663,682 42,596,066 20,123,356
----------- ----------- ----------- -----------
Shares repurchased:
Class A ..................................... (11,356,046) (6,615,043) (10,448,450) (8,669,868)
Class B ..................................... (2,026,859) (1,358,539) (513,317) (325,415)
Class D ..................................... (6,095,959) (4,192,374) (3,753,667) (3,500,176)
Exchanged into associated Funds:
Class A ..................................... (15,405,894) (3,071,754) (16,445,590) (10,296,821)
Class B ..................................... (1,836,699) (1,159,574) (442,471) (519,418)
Class D ..................................... (4,534,421) (1,979,913) (2,561,251) (2,561,251)
----------- ----------- ----------- -----------
Total ......................................... (41,255,878) (18,377,197) (42,108,514) (25,872,949)
----------- ----------- ----------- -----------
Increase (decrease) in shares ................. (5,517,091) 19,286,485 487,552 (5,749,593)
=========== =========== =========== ===========
</TABLE>
72
<PAGE>
9. Outstanding Forward Exchange Currency Contracts--At October 31, 1998, the
Fund had outstanding forward exchange currency contracts to purchase or sell
foreign currencies as follows:
<TABLE>
<CAPTION>
UNREALIZED
FOREIGN IN EXCHANGE SETTLEMENT APPRECIATION
CONTRACT CURRENCY FOR US $ DATE VALUE US $ (depreciation)
- ----------- ----------- ------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C>
INTERNATIONAL FUND
Purchases:
Germandeutschemarks 451,329 272,937 11/3/98 272,871 $ (66)
Spanish pesetas 13,278,322 94,440 11/3/98 94,434 (6)
Swiss francs 191,433 141,540 11/3/98 141,665 125
Swiss francs 156,781 115,365 11/4/98 116,023 658
Japanese yen 146,652,000 1,100,000 11/18/98 1,265,441 165,441
-------------
$ 166,152
=============
SALES:
Italianlira 513,322,300 313,479 11/3/98 313,575 $ (96)
Portuguese escudos 102,869,933 606,008 11/3/98 602,971 3,037
Japanese yen 517,644,000 3,600,000 11/18/98 4,466,684 (866,684)
Japanese yen 246,690,300 1,900,000 11/18/98 2,128,659 (228,659)
-------------
$ (1,092,402)
=============
EMERGING MARKETS GROWTH FUND
Purchases:
Hong Kong dollars 4,547,179 586,922 11/2/98 587,149 $ 227
=============
Sales:
Greek drachma 58,901,869 209,243 11/3/98 209,377 $ (134)
SouthAfrican rand 1,201,681 214,108 11/3/98 214,203 (95)
-------------
$ (229)
=============
GLOBAL GROWTH OPPORTUNITIES FUND
Purchases:
Japanese yen 399,960,000 3,000,000 11/18/98 3,451,204 $ 451,204
Japanese yen 354,636,000 3,000,000 11/18/98 3,060,108 60,108
-------------
$ 511,312
=============
SALES:
Singapore dollars 6,990 4,313 11/2/98 4,305 $ 8
Swiss francs 12,358 9,221 11/2/98 9,145 76
Italian lira 3,169,129,710 1,935,346 11/3/98 1,935,937 (591)
Japanese yen 905,877,000 6,300,000 11/18/98 7,816,697 (1,516,697)
Japanese yen 454,429,500 3,500,000 11/18/98 3,921,214 (421,214)
-------------
$ (1,938,418)
=============
</TABLE>
73
<PAGE>
<TABLE>
<CAPTION>
UNREALIZED
FOREIGN IN EXCHANGE SETTLEMENT APPRECIATION
CONTRACT CURRENCY FOR US $ DATE VALUE US $ (depreciation)
- ----------- ----------- ------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C>
GLOBAL SMALLER COMPANIES FUND
Purchases:
Netherland guilders 318,954 171,683 11/2/98 170,920 $ (763)
Hong Kong dollars 2,124,426 274,314 11/3/98 274,314 --
Japanese yen 1,333,200,000 10,000,000 11/18/98 11,504,012 1,504,012
Japanese yen 585,000,000 5,036,157 11/18/98 5,047,890 11,733
-----------
$ 1,514,982
===========
Sales:
Austrian schillings 420,384 36,255 11/2/98 36,126 $ 129
Japanese yen 27,201,624 234,093 11/2/98 233,841 252
Swiss francs 72,474 54,077 11/2/98 53,633 444
Japanese yen 4,026,120,000 28,000,000 11/18/98 34,740,875 (6,740,875)
Japanese yen 2,012,473,500 15,500,000 11/18/98 17,365,377 (1,865,377)
-----------
$(8,605,427)
===========
GLOBAL TECHNOLOGY FUND
Purchases:
British pounds 54,313 91,154 11/2/98 90,893 $ (261)
Netherland guilders 5,413,181 2,903,288 11/3/98 2,900,799 (2,489)
Swedish kronor 27,347,198 3,505,826 11/3/98 3,508,525 2,699
-----------
$ (51)
===========
Sales:
Japanese yen 2,663,600,000 20,000,000 11/30/98 23,021,608 $(3,021,608)
===========
</TABLE>
74
<PAGE>
FINANCIAL HIGHLIGHTS
The Fund's financial highlights are presented below. "Per share operating
performance" data is designed to allow investors to trace the operating
performance of each Class, on a per share basis, from the beginning net asset
value to the ending net asset value, so that investors can understand what
effect the individual items have on their investment, assuming it was held
throughout the period. Generally, the per share amounts are derived by
converting the actual dollar amounts incurred for each item, as disclosed in the
financial statements, to their equivalent per share amounts, based on average
shares outstanding.
"Total return based on net asset value" measures each Class's performance
assuming that investors purchased Fund shares at net asset value as of the
beginning of the period, invested dividends and capital gains paid at net asset
value, and then sold their shares at the net asset value on the last day of the
period. The total return computations do not reflect any sales charges investors
may incur in purchasing or selling shares of each Series. Total returns for
periods of less than one year are not annualized.
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------
INTERNATIONAL FUND YEAR ENDED OCTOBER 31,
------------------------------------------------------
Per Share Operating Performance: 1998 1997 1996 1995 1994
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR ................. $17.92 $17.17 $16.71 $17.67 $15.98
------ ------ ------ ------ ------
Net investment income (loss) ....................... 0.03 (0.04) 0.05 0.06 0.04
Net realized and unrealized investment gain (loss) . 0.62 2.47 1.77 (0.42) 0.91
Net realized and unrealized gain (loss) from foreign
currency transactions ............................ 0.40 (0.79) (0.44) 0.09 1.08
------ ------ ----- ------ ------
INCREASE (DECREASE) FROM INVESTMENT OPERATIONS ..... 1.05 1.64 1.38 (0.27) 2.03
Dividends paid ..................................... -- -- -- -- (0.01)
Distributions from net gain realized ............... (1.22) (0.89) (0.92) (0.69) (0.33)
------ ------ ----- ------ ------
NET INCREASE (DECREASE) IN NET ASSET VALUE ......... (0.17) 0.75 0.46 (0.96) 1.69
------ ------ ----- ------ ------
NET ASSET VALUE, END OF YEAR ....................... $17.75 $17.92 $17.17 $16.71 $17.67
====== ====== ====== ====== ======
TOTAL RETURN BASED ON NET ASSET VALUE: ............. 6.51% 9.83% 8.43% (1.24)% 12.85
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets ..................... 1.69% 1.78% 1.81% 1.69% 1.63%
Net investment income (loss) to average net assets . 0.16% (0.23)% 0.28% 0.35% 0.27%
Portfolio turnover ................................. 81.37% 83.11% 55.71% 60.70% 39.59%
NET ASSETS, END OF YEAR (000s omitted) ............. $44,122 $46,107 $50,998 $48,763 $62,922
</TABLE>
- --------------
See footnotes on page 79.
75
<PAGE>
FINANCIAL HIGHLIGHTS
CLASS B
-------------------------------
INTERNATIONAL FUND (CONTINUED) YEAR ENDED
OCTOBER 31, 4/22/96*
------------------- TO
PER SHARE OPERATING PERFORMANCE: 1998 1997 10/31/96
------- ------- ---------
NET ASSET VALUE, BEGINNING OF PERIOD .... $17.30 $16.74 $17.38
------ ------ -------
Net investment loss ..................... (0.12) (0.18) (0.03)
Net realized and unrealized investment
gain (loss) ............................ 0.57 2.42 (0.54)
Net realized and unrealized loss from
foreign currency transactions ......... 0.40 (0.79) (0.07)
------ ------ ------
INCREASE (DECREASE) FROM INVESTMENT
OPERATIONS ............................ 0.85 1.45 (0.64)
Dividends paid .......................... -- -- --
Distributions from net gain realized .... (1.22) (0.89) --
------ ------ ------
NET INCREASE (DECREASE) IN
NET ASSET VALUE ....................... (0.37) 0.56 (0.64)
------ ------ -------
NET ASSET VALUE, END OF PERIOD .......... $16.93 $17.30 $16.74
====== ====== ======
Total Return Based on Net AssetValue: ... 5.51% 8.90% (3.68)%
Ratios/Supplemental Data:
Expenses to average net assets .......... 2.55% 2.58% 2.66%+
Net investment loss to average net assets (0.70)% (1.03)% (0.35)%+
Portfolio turnover ...................... 81.37% 83.11% 55.71%++
Net Assets, End of Period (000s omitted) $9,835 $6,350 $2,843
<TABLE>
<CAPTION>
CLASS D
--------------------------------------------------------
YEAR ENDED OCTOBER 31,
--------------------------------------------------------
PER SHARE OPERATING PERFORMANCE: 1998 1997 1996 1995 1994
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR .......... $17.30 $16.74 $16.43 $17.53 $15.96
------ ------ ------ ------ ------
Net investment loss ......................... (0.12) (0.18) (0.08) (0.07) (0.09)
Net realized and unrealized investment
gain (loss) ........................... 0.57 2.42 1.75 (0.43) 0.91
Net realized and unrealized gain (loss)
from foreign currency transactions .... 0.40 (0.79) (0.44) 0.09 1.08
------ ------ ------ ------ ------
INCREASE (DECREASE) FROM INVESTMENT
OPERATIONS ................................ 0.85 1.45 1.23 (0.41) 1.90
Dividends paid .............................. -- -- -- -- --
Distributions from net gain realized ........ (1.22) (0.89) (0.92) (0.69) (0.33)
------ ------ ------ ------ ------
NET INCREASE (DECREASE) IN
NET ASSET VALUE ........................... (0.37) 0.56 0.31 (1.10) 1.57
------ ------ ------ ------ ------
NET ASSET VALUE, END OF YEAR ................ $16.93 $17.30 $16.74 $16.43 $17.53
====== ====== ====== ====== ======
TOTAL RETURN BASED ON NET ASSE VALUE: ....... 5.51% 8.90% 7.62% (2.08)% 12.03%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets .............. 2.55% 2.58% 2.64% 2.50% 2.50%
Net investment loss to average net assets ... (0.70)% (1.03)% (0.47)% (0.44)% (0.53)%
Portfolio turnover .......................... 81.37% 83.11% 55.71% 60.70% 39.59%
NET ASSETS, END OF YEAR (000s omitted) ...... $37,485 $40,977 $47,917 $31,273 $19,903
Without expense reimbursement and/or
management fee waiver:**
Net investment loss per share ............. $(0.09) $(0.11)
Ratios:
Expenses to average net assets ............ 2.62% 2.67%
Net investment loss to average net assets.. (0.56)% (0.70)%
</TABLE>
- -------------
See footnotes on page 79.
76
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS D
---------------------------- --------------------------- ----------------------------
EMERGING MARKETS YEAR ENDED YEAR ENDED YEAR ENDED
GROWTH FUND OCTOBER 31, 5/28/96* OCTOBER 31, 5/28/96* OCTOBER 31, 5/28/96*
--------------- TO ----------------- TO ---------------- TO
PER SHARE OPERATING PERFORMANCE: 1998 1997 10/31/96 1998 1997 10/31/96 1998 1997 10/31/96
------ ------ --------- ------ ------ --------- ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD ... $7.34 $6.78 $7.14 $7.27 $6.76 $7.14 $7.27 $6.76 $7.14
----- ----- ----- ----- ----- ----- ----- ----- -----
Net investment loss .................... (0.01) (0.05) (0.02) (0.06) (0.11) (0.04) (0.06) (0.11) (0.04)
Net realized and unrealized investment
gain (loss) .......................... (2.00) 1.05 (0.25) (1.97) 1.06 (0.25) (1.97) 1.06 (0.25)
Net realized and unrealized loss from
foreign currency transactions ........ (0.15) (0.44) (0.09) (0.15) (0.44) (0.09) (0.15) (0.44) (0.09)
----- ----- ----- ----- ----- ----- ----- ----- -----
INCREASE (DECREASE) FROM INVESTMENT
OPERATIONS ........................... (2.16) 0.56 (0.36) (2.18) 0.51 (0.38) (2.18) 0.51 (0.38)
Dividends paid ......................... -- -- -- -- -- -- -- -- --
Distributions from net gain realized ... -- -- -- -- -- -- -- -- --
----- ----- ----- ----- ----- ----- ----- ----- -----
NET INCREASE (DECREASE) IN
NET ASSET VALUE ...................... (2.16) 0.56 (0.36) (2.18) 0.51 (0.38) (2.18) 0.51 (0.38)
----- ----- ----- ----- ----- ----- ----- ----- -----
NET ASSET VALUE, END OF PERIOD ......... $5.18 $7.34 $6.78 $5.09 $7.27 $6.76 $5.09 $7.27 $6.76
===== ===== ===== ===== ===== ===== ===== ===== =====
TOTAL RETURN BASED ON NET ASSET VALUE: . (29.43)% 8.26% (5.04)% (29.99)% 7.54% (5.32)% (29.99)% 7.54% (5.32)%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets ......... 2.22% 2.27% 2.22%+ 2.99% 3.04% 3.00%+ 2.99% 3.04% 3.00%+
Net investment loss to average
net assets ........................... (0.12)% (0.56)% (0.69)%+ (0.89)% (1.33)% (1.47)%+ (0.89)% (1.33)% (1.47)%+
Portfolio turnover ..................... 94.09% 84.09% 12.24% 94.09% 84.09% 12.24% 94.09% 84.09% 12.24%
Net Assets, End of Period (000s omitted) $24,294 $44,061 $19,864 $16,031 $28,819 $10,541 $13,667 $31,259 $13,664
Without expense reimbursement and/or
management fee waiver:**
Net investment loss per share ........ $(0.05) $(0.07) $(0.07)
Ratios:
Expenses to average net assets ....... 3.02%+ 3.80%+ 3.80%+
Net investment loss to average
net assets .......................... (1.49)%+ (2.27)%+ (2.27)%+
</TABLE>
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS D
--------------------------- --------------------------- ----------------------------
GLOBAL GROWTH YEAR ENDED 11/1/95* YEAR ENDED 4/22/96* YEAR ENDED 11/1/95*
OPPORTUNITIES FUND OCTOBER 31, TO OCTOBER 31, TO OCTOBER 31, TO
----------------- ----------------- -----------------
PER SHARE OPERATING PERFORMANCE: 1998 1997 10/31/96 1998 1997 10/31/96 1998 1997 10/31/96
------ ------ --------- ------ ------ --------- ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD .... $9.20 $8.08 $7.14 $9.06 $8.02 $8.04 $9.06 $8.02 $7.14
----- ----- ----- ----- ----- ----- ----- ----- -----
Net investment loss ..................... (0.05) (0.05) (0.03) (0.12) (0.12) (0.04) (0.12) (0.12) (0.09)
Net realized and unrealized
investment gain ....................... 0.81 1.47 1.12 0.80 1.46 0.06 0.80 1.46 1.12
Net realized and unrealized
gain (loss) from
foreign currency transactions ......... 0.08 (0.30) (0.15) 0.08 (0.30) (0.04) 0.08 (0.30) (0.15)
----- ----- ----- ----- ----- ----- ----- ----- -----
INCREASE (DECREASE) FROM
INVESTMENT OPERATIONS ................. 0.84 1.12 0.94 0.76 1.04 (0.02) 0.76 1.04 0.88
Dividends paid .......................... -- -- -- -- -- -- -- -- --
Distributions from net gain realized .... (0.42) -- -- (0.42) -- -- (0.42)
----- ----- ----- ----- ----- ----- ----- ----- -----
NET INCREASE (DECREASE) IN NET
ASSET VALUE ........................... 0.42 1.12 0.94 0.34 1.04 (0.02 )0.34 1.04 0.88
----- ----- ----- ----- ----- ----- ----- ----- -----
NET ASSET VALUE, END OF PERIOD .......... $9.62 $9.20 $8.08 $9.40 $9.06 $8.02 $9.40 $9.06 $8.02
===== ===== ===== ===== ===== ===== ===== ===== =====
TOTAL RETURN BASED ON NET ASSET VALUE: .. 9.52% 13.86% 13.17% 8.76% 12.97% (0.25)% 8.76% 12.97% 12.33%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets .......... 1.68% 1.69% 1.91% 2.44% 2.45% 2.53%+ 2.44% 2.45% 2.67%
Net investment loss to average net assets (0.48)% (0.59)% (0.53)% (1.24)% (1.35)% (1.13)%+ (1.24)% (1.35)% (1.25)%
Portfolio turnover ...................... 45.43% 79.32% 31.44% 45.43% 79.32% 31.44%++ 45.43% 79.32% 31.44%
NET ASSETS, END OF YEAR (000s omitted) .. $97,947 $109,060 $107,509 $21,930 $19,311 $9,257 $64,443 $64,300 $53,540
</TABLE>
- ------------------
See footnotes on page 79.
77
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
---------------------------------------------------------------------
GLOBAL SMALLER COMPANIES FUND YEAR ENDED OCTOBER 31,
---------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE: 1998 1997 1996 1995 1994
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR ............ $15.62 $15.14 $13.90 $11.93 $ 9.98
------ ------ ------ ------ ------
Net investment income (loss) .................. (0.07) -- -- (0.02) (0.08)
Net realized and unrealized investment
gain (loss) ............................... (0.85) 1.61 2.38 2.24 1.57
Net realized and unrealized gain (loss)
from foreign currency transactions ......... 0.04 (0.40) (0.18) 0.08 0.52
------ ------ ------ ------ ------
INCREASE (DECREASE) FROM INVESTMENT
OPERATIONS ................................. (0.88) 1.21 2.20 2.30 2.01
Dividends paid ................................ -- -- -- -- --
Distributions from net gain realized .......... (0.63) (0.73) (0.96) (0.33) (0.06)
------ ------ ------ ------ ------
NET INCREASE (DECREASE) IN NET ASSET VALUE .... (1.51) 0.48 1.24 1.97 1.95
------ ------ ------ ------ ------
Net Asset Value, End of Year .................. $14.11 $15.62 $15.14 $13.90 $11.93
====== ====== ====== ====== ======
Total Return Based on Net Asset Value: ........ (5.82)% 8.28% 16.95% 20.10% 20.28%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets ................ 1.65% 1.67% 1.75% 1.83% 1.92%
Net investment income (loss) to average
net assets ................................ (0.45)% 0.02% 0.01% (0.20)% (0.77)%
Portfolio turnover ............................ 50.81% 57.24% 45.38% 63.05% 62.47%
NET ASSETS, END OF YEAR (000S OMITTED) ........ $374,890 $434,397 $350,359 $102,479 $46,269
</TABLE>
<TABLE>
<CAPTION>
CLASS B CLASS D
-----------------------------------------------------------------------
YEAR ENDED
OCTOBER 31, 4/22/96* YEAR ENDED OCTOBER 31,
----------------- TO -----------------------------------------
PER SHARE OPERATING PERFORMANCE: 1998 1997 10/31/96 1998 1997 1996 1995 1994
------- -------- --------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD ........ $15.04 $14.72 $14.44 $15.05 $14.72 $13.63 $11.80 $ 9.94
------ ------ ------ ------ ------ ------ ------ -------
Net investment loss ......................... (0.18) (0.11) (0.06) (0.18) (0.11) (0.11) (0.12) (0.16)
Net realized and unrealized investment
gain (loss) ................................ (0.81) 1.56 0.33 (0.81) 1.57 2.34 2.20 1.57
Net realized and unrealized gain (loss)
from foreign currency transactions ......... 0.04 (0.40) 0.01 0.04 (0.40) (0.18) 0.08 0.51
------ ------ ------ ------ ------ ------ ------ -------
INCREASE (DECREASE) FROM INVESTMENT
OPERATIONS ................................. (0.95) 1.05 0.28 (0.95) 1.06 2.05 2.16 1.92
Dividends paid .............................. -- -- -- -- -- -- -- --
Distributions from net gain realized ........ (0.63) (0.73) -- (0.63) (0.73) (0.96) (0.33) (0.06)
------ ------ ------ ------ ------ ------ ------ -------
NET INCREASE (DECREASE) IN NET ASSET VALUE .. (1.58) 0.32 0.28 (1.58) 0.33 1.09 1.83 1.86
------ ------ ------ ------ ------ ------ ------ -------
NET ASSET VALUE, END OF PERIOD .............. $13.46 $15.04 $14.72 $13.47 $15.05 $14.72 $13.63 $11.80
====== ====== ====== ====== ====== ====== ====== =======
TOTAL RETURN BASED ON NET ASSET VALUE: ...... (6.54)% 7.39% 1.94% (6.53)% 7.47% 16.14% 19.11% 19.45%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets .............. 2.41% 2.43% 2.54%+ 2.41% 2.43% 2.51% 2.61% 2.70%
Net investment loss to average net assets ... (1.21)% (0.74)% (0.80)%+ (1.21)% (0.74)% (0.75)% (0.97)% (1.53)%
Portfolio turnover ......................... 50.81% 57.24% 45.38%++ 50.81% 57.24% 45.38% 63.05% 62.47%
Net Assets, End of Period (000s omitted) .... $222,496 $247,600 $103,968 $272,992 $370,625 $285,477 $85,548 $38,317
</TABLE>
- ---------------
See footnotes on page 79.
78
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------------------
GLOBAL TECHNOLOGY FUND YEAR ENDED OCTOBER 31, 5/23/94*
---------------------------------------------- TO
PER SHARE OPERATING PERFORMANCE: 1998 1997 1996 1995 10/31/94
------ ------ ------ ------ ---------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD ........................ $15.14 $11.31 $13.05 $ 8.37 $7.14
------ ------ ------ ------- ------
Net investment loss ......................................... (0.14) (0.16) (0.08) (0.10) (0.01)
Net realized and unrealized investment gain (loss) .......... 0.01 4.06 (0.92) 4.90 1.08
Net realized and unrealized gain (loss) from foreign
currency transactions ..................................... 0.06 (0.07) 0.05 (0.05) 0.16
------ ------ ------ ------ -----
INCREASE (DECREASE) FROM INVESTMENT OPERATIONS .............. (0.07) 3.83 (0.95) 4.75 1.23
Dividends paid .............................................. -- -- (0.02) -- --
Distributions from net gain realized ........................ (2.59) -- (0.77) (0.07) --
------ ------ ------ ------ -----
NET INCREASE (DECREASE) IN NET ASSET VALUE .................. (2.66) 3.83 (1.74) 4.68 1.23
------ ------ ------ ------ -----
NET ASSET VALUE, END OF PERIOD .............................. $12.48 $15.14 $11.31 $13.05 $8.37
====== ====== ====== ====== =====
TOTAL RETURN BASED ON NET ASSET VALUE: ...................... (0.79)% 33.86% (7.33)% 57.31% 17.23%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets .............................. 1.67% 1.67% 1.75% 1.91% 2.00%+
Net investment loss to average net assets ................... (1.04)% (1.10)% (0.74)% (0.89)% (0.45)%+
Portfolio turnover .......................................... 87.55% 94.06% 73.00% 87.42% 29.20%
NET ASSETS, END OF PERIOD (000S OMITTED) .................... $475,951 $583,257 $499,858 $447,732 $50,719
Without expense reimbursement and/or management fee waiver:**
Net investment loss per share ............................. $(0.02)
Ratios:
Expenses to average net assets ............................ 2.18%+
Net investment loss to average net assets ................. (0.63)%+
</TABLE>
<TABLE>
<CAPTION>
CLASS B CLASS D
------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED OCTOBER 31,
OCTOBER 31, 4/22/96* ------------------------------------- 5/23/94*
------------------- TO TO
PER SHARE OPERATING PERFORMANCE: 1998 1997 10/31/96 1998 1997 1996 1995 10/31/94
------ ------ -------- ------ ------ ------ ------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $14.73 $11.09 $11.47 $14.73 $11.09 $12.89 $ 8.34 $7.14
------ ------ ------ ------ ------ ------ ------ ------
Net investment loss (0.23) (0.26) (0.08) (0.23) (0.26) (0.17) (0.18) (0.04)
Net realized and unrealized investment
gain (loss) 0.01 3.97 (0.39) (0.01) 3.97 (0.91) 4.85 1.08
Net realized and unrealized gain (loss)
from foreign currency transactions 0.06 (0.07) 0.09 0.06 (0.07) 0.05 (0.05) 0.16
------ ------ ------ ------ ------ ------ ------ ------
INCREASE (DECREASE) FROM INVESTMENT OPERATIONS (0.16) 3.64 (0.38) (0.18) 3.64 (1.03) 4.62 1.20
Dividends paid -- -- -- -- -- -- -- --
Distributions from net gain realized (2.59) -- -- (2.59) -- (0.77) (0.07) --
------ ------ ------ ------ ------ ------ ------ ------
NET INCREASE (DECREASE) IN NET ASSET VALUE (2.75) 3.64 (0.38) (2.77) 3.64 (1.80) 4.55 1.20
------ ------ ------ ------ ------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $11.98 $14.73 $11.09 $11.96 $14.73 $11.09 $12.89 $8.34
====== ====== ====== ====== ====== ====== ====== ======
TOTAL RETURN BASED ON NET ASSET VALUE: (1.55)% 32.82% (3.31)% (1.70)% 32.82% (8.07)% 55.95% 16.81%
RATIOS/SUPPLEMENTAL DATA:
Expenses to average net assets 2.43% 2.42% 2.51%+ 2.43% 2.42% 2.52% 2.66% 2.75%+
Net investment loss to average net assets (1.80)% (1.85)% (1.40)%+ (1.80)% (1.85)% (1.50)% (1.63)% (1.22)%+
Portfolio turnover 87.55% 94.06% 73.00%++ 87.55% 94.06% 73.00% 87.42% 29.20%
NET ASSETS, END OF PERIOD (000S OMITTED) $58,575 $53,046 $18,840 $184,032 $232,882 $197,412 $161,622 $6,499
Without expense reimbursement and/or
management fee waiver:**
Net investment loss per share $(0.06)
Ratios:
Expenses to average net assets 3.36%+
Net investment loss to average net assets (1.83)%+
</TABLE>
- ---------
* Commencement of operations.
** The Manager and Subadviser, at their discretion, waived a portion of their
fees and, in some cases, the Subadviser reimbursed certain expenses for
the periods presented.
+ Annualized.
++ For the year ended October 31, 1996.
See Notes to Financial Statements.
79
<PAGE>
REPORT OF INDEPENDENT AUDITORS
THE BOARD OF DIRECTORS AND SHAREHOLDERS,
SELIGMAN HENDERSON GLOBAL FUND SERIES, INC.:
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of the International Fund, the Emerging Markets
Growth Fund, the Global Growth Opportunities Fund, the Global Smaller Companies
Fund, and the Global Technology Fund Series of Seligman Henderson Global Fund
Series, Inc. as of October 31, 1998, the related statements of operations for
the year then ended and of changes in net assets for each of the years in the
two-year period then ended, and the financial highlights for each of the periods
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at October
31, 1998, by correspondence with the Fund's custodian and brokers; where replies
were not received from brokers, we performed other auditing procedures. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of each Series of
Seligman Henderson Global Fund Series, Inc. as of October 31, 1998, the results
of their operations, the changes in their net assets, and the financial
highlights for the respective stated periods in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
December 4, 1998
80
<PAGE>
BOARD OF DIRECTORS
JOHN R. GALVIN 2, 4
DEAN, Fletcher School of Law and Diplomacy
at Tufts University
DIRECTOR, Raytheon Company
ALICE S. ILCHMAN 3, 4
TRUSTEE, Committee for Economic Development
CHAIRMAN, The Rockefeller Foundation
FRANK A. MCPHERSON 2, 4
DIRECTOR, Kimberly-Clark Corporation
DIRECTOR, Baptist Medical Center
JOHN E. MEROW 2, 4
RETIRED CHAIRMAN AND SENIOR PARTNER,
Sullivan & Cromwell, Law Firm
DIRECTOR, Commonwealth Industries, Inc.
DIRECTOR, New York Presbyterian Hospital
BETSY S. MICHEL 2, 4
TRUSTEE, The Geraldine R. Dodge Foundation
CHAIRMAN OF THE BOARD OF TRUSTEES, St. George's School
WILLIAM C. MORRIS 1
CHAIRMAN
CHAIRMAN OF THE BOARD, J. & W. Seligman & Co. Incorporated
CHAIRMAN, Carbo Ceramics Inc.
DIRECTOR, Kerr-McGee Corporation
JAMES C. PITNEY 3, 4
RETIRED PARTNER, Pitney, Hardin, Kipp & Szuch, Law Firm
JAMES Q. RIORDAN 3, 4
DIRECTOR, KeySpan Energy Corporation
TRUSTEE, Committee for Economic Development
DIRECTOR, Public Broadcasting Service
RICHARD R. SCHMALTZ 1
MANAGING DIRECTOR, DIRECTOR OF INVESTMENTS,
J. & W. Seligman & Co. Incorporated
TRUSTEE EMERITUS, Colby College
ROBERT L. SHAFER 3, 4
RETIRED VICE PRESIDENT, Pfizer Inc.
JAMES N. WHITSON 2, 4
DIRECTOR AND CONSULTANT, Sammons Enterprises, Inc.
DIRECTOR, C-SPAN
DIRECTOR, CommScope, Inc.
BRIAN T. ZINO 1
PRESIDENT
PRESIDENT, J. & W. Seligman & Co. Incorporated
CHAIRMAN, Seligman Data Corp.
DIRECTOR, ICIMutual Insurance Company
DIRECTOR EMERITUS
Fred E. Brown
Director and Consultant, J. & W. SELIGMAN & CO.
Incorporated
- ----------------
Member: 1 Executive Committee
2 Audit Committee
3 Director Nominating Committee
4 Board Operations Committee
81
<PAGE>
PROXY RESULTS
Shareholders of each Series voted on the following proposals at a Special
Meeting of Shareholders held on June 30, 1998, in New York, New York. The
description of each proposal and number of shares voted are stated below. The
shareholders of all five Series voted collectively in respect of the election of
Directors and the ratification of the selection of independent auditors. In
respect of the proposals relating to the interim and new subadvisory agreements,
the shareholders of each Series voted separately. Each Director was elected, the
selection of Deloitte & Touche LLP as auditors was ratified, and the interim and
new subadvisory agreements were approved.
ELECTION OF DIRECTORS:
For Withheld
---- -----------
John R. Galvin 105,497,129 1,987,168
Alice S. Ilchman 105,505,135 1,979,161
Frank A. McPherson 105,505,057 1,979,239
John E. Merow 105,504,427 1,979,869
Betsy S. Michel 105,501,319 1,982,977
William C. Morris 105,508,287 1,976,009
James C. Pitney 105,493,493 1,990,804
James Q. Riordan 105,498,612 1,985,684
Richard R. Schmaltz 105,505,948 1,978,349
Robert L. Shafer 105,504,103 1,980,194
James N. Whitson 105,508,491 1,975,806
Brian T. Zino 105,505,870 1,978,427
RATIFICATION OF DELOITTE & TOUCHE LLP AS AUDITORS:
<TABLE>
<CAPTION>
For Against Abstain
---- ----------- ---------
<S> <C> <C> <C>
103,834,744 828,074 2,821,124
APPROVAL OF INTERIM SUBADVISORY AGREEMENTS
BETWEEN J. & W. SELIGMAN & CO. INCORPORATED
AND SELIGMAN HENDERSON CO.:
Seligman Henderson International Fund 2,592,848 8,037 129,431
Seligman Henderson Emerging Markets Growth Fund 6,848,574 106,520 246,368
Seligman Henderson Global Growth Opportunites Fund 13,627,795 126,041 551,941
Seligman Henderson Global Smaller Companies Fund 42,166,124 466,464 1,501,383
Seligman Henderson Global Technology Fund 36,921,480 535,865 1,655,339
APPROVAL OF NEW SUBADVISORY AGREEMENT
BETWEEN J. & W. SELIGMAN & CO. INCORPORATED
AND HENDERSON INVESTMENT MANAGEMENT LIMITED,
EFFECTIVE JULY 1, 1998:
Seligman Henderson International Fund 2,591,707 9,988 128,623
Seligman Henderson Emerging Markets Growth Fund 6,848,518 104,254 248,682
Seligman Henderson Global Growth Opportunites Fund 13,624,535 139,654 541,561
Seligman Henderson Global Smaller Companies Fund 42,320,799 466,271 1,346,898
Seligman Henderson Global Technology Fund 36,895,609 551,029 1,666,034
</TABLE>
82
<PAGE>
EXECUTIVE OFFICERS
WILLIAM C. MORRIS
CHAIRMAN
BRIAN T. ZINO
PRESIDENT
BRIAN ASHFORD-RUSSELL
VICE PRESIDENT
PETER BASSETT
VICE PRESIDENT
IAIN C. CLARK
VICE PRESIDENT
NITIN MEHTA
VICE PRESIDENT
ARSEN MRAKOVCIC
VICE PRESIDENT
MARION S. SCHULTHEIS
VICE PRESIDENT
LAWRENCE P. VOGEL
VICE PRESIDENT
PAUL H. WICK
VICE PRESIDENT
THOMAS G. ROSE
TREASURER
FRANK J. NASTA
SECRETARY
FOR MORE INFORMATION
MANAGER
J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, NY 10017
GENERAL COUNSEL
Sullivan & Cromwell
INDEPENDENT AUDITORS
Deloitte & Touche LLP
SUBADVISER
Henderson Investment
Management Limited
3 Finsbury Avenue
London, EC2M 2PA
England
GENERAL DISTRIBUTOR
Seligman Advisors, Inc.
100 Park Avenue
New York, NY 10017
SHAREHOLDER SERVICE AGENT
Seligman Data Corp.
100 Park Avenue
New York, NY 10017
IMPORTANT TELEPHONE NUMBERS
(800) 221-2450 Shareholder Services
(800) 445-1777 Retirement
Plan Services
(212) 682-7600 Outside the United States
(800) 622-4597 24-Hour Automated Telephone Access Service
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GLOSSARY OF FINANCIAL TERMS
CAPITAL GAIN DISTRIBUTION -- A payment to mutual fund shareholders of profits
realized on the sale of securities in a fund's portfolio. For tax purposes,
these profits may be taxed at different rates, primarily depending upon the
length of time the securities were owned by the fund.
CAPITAL APPRECIATION/DEPRECIATIOn -- An increase or decrease in the market value
of a mutual fund's portfolio securities, which is reflected in the net asset
value of the fund's shares. Capital appreciation/depreciation of an individual
security is in relation to the original purchase price.
COMPOUNDING -- The change in the value of an investment as shareholders receive
earnings on their investment's earnings. For example, if $1,000 is invested at a
fixed rate of 7% a year, the initial investment is worth $1,070 after one year.
If the return is compounded, second year earnings will not be based on the
original $1,000, but on the $1,070, which includes the first year's earnings.
CONTINGENT DEFERRED SALES CHARGE (CDSC) -- Depending on the class of shares
owned, a fee charged by a mutual fund when shares are sold back to the fund (the
CDSC expires after a fixed time period).
DIVIDEND -- A payment by a mutual fund, usually derived from the fund's net
investment income (dividends and interest less expenses).
DIVIDEND YIELD -- A measurement of a fund's dividend as a percentage of the
maximum offering price.
EXPENSE RATIO -- The cost of doing business for a mutual fund, expressed as a
percent of the fund's net assets.
INVESTMENT OBJECTIVE -- The shared investment goal of a fund and its
shareholders.
MANAGEMENT FEE -- The amount paid by a mutual fund to its investment advisor(s).
MULTIPLE CLASSES OF SHARES -- Although an individual mutual fund invests in only
one portfolio of securities, it may offer investors several purchase options
which are "classes" of shares. Multiple classes permit shareholders to choose
the fee structure that best meets their needs and goals. Generally, each class
will differ in terms of how and when sales charges and certain fees are
assessed.
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. (NASD) -- A self-regulatory
body with authority over firms that distribute mutual funds.
NET ASSET VALUE (NAV) PER SHARE -- The market worth of one fund share, obtained
by adding a mutual fund's total assets (securities, cash, and any accrued
earnings), subtracting liabilities, and dividing the resulting net assets by the
number of shares outstanding.
OFFERING PRICE (OP) -- The price at which a mutual fund's share can be
purchased. The offering price per share is the current net asset value plus any
sales charge.
PORTFOLIO TURNOVER -- A measure of the trading activity in a mutual fund's
investment portfolio that reflects how often securities are bought and sold.
PROSPECTUS -- The legal document describing a mutual fund to all prospective
shareholders. It contains information required by the Securities and Exchange
Commission (SEC), such as a fund's investment objective and policies, services,
investment restrictions, officers and directors, how shares are bought and
redeemed, fund fees and other charges, and the fund's financial statements.
SEC YIELD -- SEC Yield refers to the net income earned by a fund during a recent
30-day period. This income is annualized and then divided by the maximum
offering price per share on the last day of the 30-day period. The SEC Yield
formula reflects semiannual compounding.
SECURITIES AND EXCHANGE COMMISSION -- The primary US federal agency that
regulates the registration and distribution of mutual fund shares.
STATEMENT OF ADDITIONAL INFORMATION -- Adocument that contains updated or more
detailed information about an investment company and that supplements the
prospectus. It is available at no charge upon request.
TOTAL RETURN -- A measure of a fund's performance encompassing all elements of
return. Reflects the change in share price over a given period and assumes all
distributions are taken in additional fund shares. The AVERAGE ANNUAL TOTAL
RETURN represents the average annual compounded rate of return for the periods
presented.
YIELD ON SECURITIES -- For bonds, the current yield is the coupon rate of
interest, divided by the purchase price. For stocks, the yield is measured by
dividing dividends paid by the market price of the stock.
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Adapted from the Investment Company Institute's 1998 MUTUAL FUND FACT BOOK.
84
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BENCHMARKS
LIPPER EMERGING MARKETS FUNDS AVERAGE:*
This average is comprised of mutual funds which seek long-term capital
appreciation by investing at least 65% of total assets in emerging market equity
securities, where "emerging market" is defined by a country's GNP per capita or
other economic measures. This average was comprised of 184 mutual funds at
October 31, 1998.
LIPPER INTERNATIONAL FUNDS AVERAGE:*
This average is comprised of mutual funds which invest their assets in equity
securities whose primary trading markets are outside the US. This average was
comprised of 574 mutual funds at October 31, 1998.
LIPPER GLOBAL FUNDS AVERAGE:*
This average is comprised of mutual funds which invest at least 25% of their
portfolios in equity securities traded outside the US, and may own US securities
as well. This average was comprised of 248 mutual funds at October 31, 1998.
LIPPER SCIENCE & TECHNOLOGY FUNDS AVERAGE:*
This average is comprised of mutual funds which invest 65% of their equity
portfolios in science and technology stocks. This average was comprised of 82
mutual funds at October 31, 1998.
LIPPER GLOBAL SMALL CAP FUNDS AVERAGE:*
This average is comprised of mutual funds which invest at least 25% of their
portfolios in equity securities whose primary trading markets are outside the
US, and which limit at least 65% of their investments to companies with market
capitalizations less than US $1 billion at the time of purchase. This average
was comprised of 42 mutual funds at October 31, 1998.
MORGAN STANLEY CAPITAL INTERNATIONAL EAFE (EUROPE,
AUSTRALASIA, FAR EAST) INDEX (MSCIEAFE INDEX):
This is a market-capitalization-weighted equity index comprised of 20 countries
and representing the developed stock markets outside North America.
MSCI WORLD INDEX:
This is a market-capitalization-weighted equity index comprised of 22 countries
and representing the world's developed stock markets.
MSCI EMERGING MARKETS FREE INDEX:
This is a market-capitalization-weighted equity index comprised of 26 countries
and representing the investment opportunities in the developing world available
to foreign investors.
SALOMON SMITH BARNEY EXTENDED MARKET INDEX WORLD:
This index represents the small-capitalization stock universe. It comprises the
bottom 20% of the available capital of each country included in the Salomon
Smith Barney World Broad Market Index (BMI), and includes 75% of the BMI issues.
The BMI universe covers 22 countries and includes listed shares of companies
with a total available market capitalization of at least the local equivalent of
US $100 million.
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* Lipper Analytical Services Inc. calculates the Averages monthly. These monthly
results are used to determine each Average's performance versus the total
returns for each fund.
Adapted from materials from LIPPER ANALYTICAL SERVICES INC., MORGAN STANLEY
CAPITAL INTERNATIONAL, and SALOMON SMITH BARNEY INCORPORATED.
<PAGE>
THIS REPORT IS INTENDED ONLY FOR THE INFORMATION OF SHAREHOLDERS OR THOSE WHO
HAVE RECEIVED THE OFFERING PROSPECTUS COVERING SHARES OF CAPITAL STOCK OF
SELIGMAN HENDERSON GLOBAL FUND SERIES, INC., WHICH CONTAINS INFORMATION
ABOUT THE SALES CHARGES, MANAGMENT FEES, AND OTHER COSTS. PLEASE READ THE
PROSPECTUS CAREFULLY BEFORE INVESTING OR SENDING MONEY.
SELIGMAN ADVISORS, INC.
AN AFFILIATE OF
[LOGO]
J.&W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 PARK AVENUE, NEW YORK, NY 10017
EQSH2 10/98 [RECYCLE LOGO] Printed on Recycled Paper
