Dreyfus
International
Growth Fund
SEMIANNUAL REPORT November 30, 1999
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Year 2000 Issues (Unaudited)
The fund could be adversely affected if the computer systems used by Dreyfus and
the fund's other service providers do not properly process and calculate
date-related information from and after January 1, 2000. Dreyfus has taken steps
designed to avoid year 2000-related problems in its systems and to monitor the
readiness of other service providers. In addition, issuers of securities in
which the fund invests may be adversely affected by year 2000-related problems.
This could have an impact on the value of the fund's investments and its share
price.
Contents
THE FUND
- --------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
10 Statement of Assets and Liabilities
11 Statement of Operations
12 Statement of Changes in Net Assets
13 Financial Highlights
14 Notes to Financial Statements
FOR MORE INFORMATION
- ---------------------------------------------------------------------------
Back Cover
The Fund
Dreyfus International Growth Fund
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus International
Growth Fund, covering the six-month period from June 1, 1999 through November
30, 1999. Inside, you' ll find valuable information about how the fund was
managed during the reporting period, including a discussion with the fund's
portfolio manager, Douglas Loeffler.
When the reporting period began, it had become evident that more accommodative
monetary policies implemented by central banks worldwide were helping to support
growth in Europe and economic recoveries in Japan and the emerging markets of
Asia, Latin America and Eastern Europe. The prospect of better economic
conditions and the start of banking reform and corporate restructuring helped
support higher stock prices in most international markets.
In Japan, stocks rose as the government implemented long-awaited banking and
financial reforms. European markets also fared relatively well in local currency
terms, but returns for U.S. investors were eroded by currency-related effects.
Emerging markets in Southeast Asia and Latin America have generally leveled off
after producing very attractive gains earlier in the year, before the six-month
reporting period began.
We appreciate your confidence over the past six months, and we look forward to
your continued participation in Dreyfus International Growth Fund.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
December 15, 1999
DISCUSSION OF FUND PERFORMANCE
Douglas Loeffler, Portfolio Manager
How did Dreyfus International Growth Fund perform relative to its benchmark?
For the six-month period ended November 30, 1999, the fund produced a total
return of 36.40% .(1) This compares with a 16.43% total return produced by the
fund' s benchmark, the Morgan Stanley Capital International Europe, Australasia,
Far East (MSCI EAFE((reg.tm))) Index,(2) for the same period.
We attribute this performance to two factors. First, the fund's management
changed in February of this year and resulting changes in investment approach
and strategy, as discussed below, led to marked improvement. Second, the
Japanese market in general, and the Japanese growth stocks in which we were most
heavily invested in particular, advanced sharply.
What is the fund's investment approach?
The fund focuses on individual stock selection. We do not attempt to predict
interest rates or market movements, nor do we have country allocation models or
targets. Rather, we choose investments on a company-by-company basis, searching
to find what we believe are well-managed, well-positioned companies, wherever
they may be.
We currently start with roughly 1,000 of the largest companies outside the
United States, on which we perform fundamental analyses. We look to identify
companies that we believe have achieved and can potentially sustain growth
typically through what we believe is a dominant brand name, growing market
share, high barriers to entry or untapped market opportunities. In our view,
these factors are the marks of companies whose growth, in both revenues and
earnings, has the potential to exceed that of global industry peers as well as
that of their local market. The fund is typically invested in stocks across a
broad spectrum of both countries and industries. We generally sell a The Fun
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
stock when it reaches its target price or when we determine that circumstances
have changed and it will most likely not reach the previously set target sale
price.
What factors influenced the fund's performance?
The fund's performance was strongly influenced by Japan's economy and financial
markets, which advanced strongly during the reporting period. Electronics firms
were market leaders and their growth fueled upstream demand for electronic
components. Benefiting from a growing wave of deregulation, consolidation and
restructuring, telecommunications providers and telecommunications equipment
manufacturers as well as banking and other financial service companies advanced
sharply. For U.S. investors, the sharp rise of the yen against the U.S. dollar
boosted the Japanese market's return in dollar terms.
On the other hand, Europe presented mixed results. When the fund's fiscal year
began, European markets stalled, as initial euphoria over the European Union's
new currency, the euro, ebbed, and its value declined against the dollar. By the
time the period ended, however, European economic recovery was clearly under
way. Business and consumer confidence increased, while exports and industrial
production rose. Perhaps most important, economic integration, spurred by the
introduction of a common currency and increased cross-border merger activity,
has been creating a new, highly competitive business culture. The creation of
shareholder value has become top priority for many European investors and
managers alike.
What is the fund's current strategy?
We further diversified the portfolio later in the reporting period, increasing
the number of companies in which we invest to approximately 85. We did this for
two reasons: first, to take advantage of the expanding number of growth
opportunities we saw in world markets; and second, to seek to protect the
portfolio from recent market volatility.
In Japan, foreign purchasers of stocks have been joined by Japanese retail
investors, fueling a broad-based market rally. Although we hav
taken profits in several of our investments, Japan remained our largest single
country, weighting at 25% of the fund's assets as of November 30, 1999. We have
recently shifted our focus away from leading-edge, high-technology investments
in Japan, choosing instead to place a greater emphasis on companies we believe
are positioned to benefit from a recovery of the Japanese domestic economy.
In Europe, our primary investment emphasis has been in the rapidly deregulating
telecommunications industry, with a special focus on mobile telephone and cable
television operators. The capital goods sector also remained attractive. We have
been concentrating our European investments on manufacturers of
telecommunications equipment and semiconductors. Germany, which has been a prime
driver of Europe' s economic health, has shown signs of recovery. The French,
Benelux, Spanish and Scandinavian markets also remained strong; we concentrated
investments in these countries. On the other hand, we decreased exposure to the
United Kingdom, where interest rates were high and rising.
Elsewhere, we have slightly reduced our exposure to emerging markets because we
feel they have become more fully valued. On the other hand, Canadian companies
appeared very attractively valued when compared to their peers in the United
States, and we actively sought investment opportunities there.
December 15, 1999
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE AND INVESTMENT
RETURN FLUCTUATE SUCH THAT UPON REDEMPTION FUND SHARES MAY BE WORTH MORE OR LESS
THAN THEIR ORIGINAL COST
(2) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- THE MORGAN STANLEY CAPITAL
INTERNATIONAL EUROPE, AUSTRALASIA, FAR EAST (MSCI EAFE(reg.tm)) INDEX IS AN
UNMANAGED INDEX COMPOSED OF A SAMPLE OF COMPANIES REPRESENTATIVE OF THE MARKET
STRUCTURE OF EUROPEAN AND PACIFIC BASIN COUNTRIES AND INCLUDES NET DIVIDENDS
REINVESTED.
The Fund
STATEMENT OF INVESTMENTS
November 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
COMMON STOCKS--98% Shares Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
AUSTRIA--1.3%
<S> <C> <C>
Bank Austria 14,200 751,980
CANADA--1.3%
AT&T Canada, ADR 20,075 (a) 762,850
DENMARK--1.5%
Novo Nordisk, Cl. B 6,600 863,067
FINLAND--1.4%
Nokia, ADS 5,425 749,667
Perlos 5,100 (a) 90,009
839,676
FRANCE--8.1%
Accor 3,600 818,337
Alcatel 4,700 912,440
Altran Technologies 2,175 1,036,423
Elf Aquitaine 3 17,437
Thomson Multimedia 23,500 (a) 1,019,089
Total Fina, Cl. B 7,536 987,115
4,790,841
GERMANY--5.8%
Continental 29,500 589,065
Deutsche Bank 9,300 613,859
Douglas Holding 6,000 260,193
Mannesmann 6,325 1,316,577
Preussag 12,670 636,968
3,416,662
HONG KONG--2.1%
China Telecom (Hong Kong) 226,000 (a) 1,213,380
IRELAND--1.6%
Esat Telecom, ADS 14,150 (a) 920,634
ISRAEL--1.7%
Partner Communications, ADR 54,100 (a) 1,014,375
ITALY--4.5%
Alleanza Assicurazioni 63,000 576,585
Banca Intesa 285,000 525,121
Bulgari 98,000 758,345
Enel 177,200 (a) 790,596
2,650,647
COMMON STOCKS (CONTINUED) Shares Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
JAPAN--25.3%
Bank of Fukuoka 87,000 661,354
Fujitsu 19,000 674,644
JAPAN TELECOM 23 902,403
Kao 30,500 906,474
Konami 8,900 1,195,978
NEC 36,000 842,178
NTT Mobile Communications Network 42 1,474,841
Nippon Express 116,000 671,309
Nippon Telegraph & Telephone 133 2,387,347
RICOH 49,600 919,510
Ryohin Keikaku 3,700 872,830
SOFTBANK 1,500 1,084,355
SONY 6,500 1,205,002
Sakura Bank 60,000 444,335
TDK 6,000 659,147
14,901,707
LUXEMBOURG--1.0%
Societe Europeenne des Satellites 4,625 583,039
NETHERLANDS--9.6%
ASM Lithography, ADR 8,200 (a) 767,725
Benckiser, Cl. B 12,200 744,374
Getronics 10,800 661,677
ING Groep 13,100 737,854
STMicroelectronics 6,900 939,418
United Pan-Europe Communications 7,225 (a) 710,425
VNU 26,575 1,054,615
5,616,088
NORWAY--.7%
Tomra Systems 11,250 395,026
PORTUGAL--1.9%
Brisa-Auto Estradas de Portugal 116,000 858,677
PT MULTIMEDIA 6,050 (a) 238,688
1,097,365
SINGAPORE--1.5%
DBS Group 69,824 905,511
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
SOUTH AFRICA--1.3%
DeBeers Consol Mines, ADR 29,025 780,047
SOUTH KOREA--1.6%
Korea Telecom, ADR 18,175 (a) 963,275
SPAIN--4.7%
Banco Santander Central Hispano 63,400 697,573
Centros Comerciales Continente 28,100 635,641
Tabacalera, Cl. A 35,875 592,989
Telefonica Publicidad e Informacion 28,150 (a) 854,517
2,780,720
SWEDEN--4.0%
Ericsson (LM) Tel, Cl. B, ADS 17,000 819,187
ForeningsSparbanken 44,000 677,679
Skandia Forsakrings 35,800 856,540
2,353,406
SWITZERLAND--3.3%
Roche Holding Ag-Genusss 56 676,780
Swatch, Cl. B 750 645,339
Synthes-Stratec 1,500 (a) 585,390
1,907,509
TAIWAN--1.1%
Taiwan Semiconductor Manufacturing, ADS 17,248 (a) 617,693
UNITED KINGDOM--11.5%
AstraZeneca 15,500 693,254
BP Amoco, ADS 12,350 752,578
British Aerospace 24,994 143,331
COLT Telecom 16,500 (a) 624,302
Dixons 28,000 611,394
Energis 18,675 (a) 760,927
Marconi 58,950 (a) 755,266
Pearson 35,000 838,094
Thus 44,600 (a) 279,469
Vodafone AirTouch 97,025 457,916
WPP 58,000 853,423
6,769,954
UNITED STATES--1.2%
Global TeleSystems Group 22,675 (a) 724,183
TOTAL COMMON STOCKS
(cost $43,515,293) 57,619,635
PREFERRED STOCKS--2.7% Shares Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
BRAZIL--1.6%
Petroleo Brasileiro 5,775 960,998
GERMANY--1.1%
SAP 1,550 627,615
TOTAL PREFERRED STOCKS
(cost $1,255,210) 1,588,613
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $44,770,503) 100.7% 59,208,248
LIABILITIES, LESS CASH AND RECEIVABLES (.7%) (392,485)
NET ASSETS 100.0% 58,815,763
(A) NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1999 (Unaudited)
Cost Value
- --------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of Investments 44,770,503 59,208,248
Receivable for investment securities sold 2,346,509
Dividends receivable 192,949
Prepaid expenses 6,024
61,753,730
- --------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 63,696
Due to Distributor 13,350
Cash overdraft due to Custodian 516,981
Payable for investment securities purchased 1,229,796
Payable for shares of Common Stock redeemed 1,047,865
Accrued expenses 66,279
2,937,967
- --------------------------------------------------------------------------------
NET ASSETS ($) 58,815,763
- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 41,580,081
Accumulated investment (loss) (442,203)
Accumulated net realized gain (loss) on investments 3,268,832
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currecy transactions 14,409,053
- --------------------------------------------------------------------------------
NET ASSETS ($) 58,815,763
- --------------------------------------------------------------------------------
SHARES OUTSTANDING
(300 million shares of $1 par value Common Stock authorized) 3,542,672
NET ASSET VALUE, offering and redemption price per share--Note 3 (e) ($)
16.60
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF OPERATIONS
Six Months Ended November 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INCOME:
Cash dividends (net of $26,048 foreign taxes withheld at source) 44,889
Interest 35,207
TOTAL INCOME 80,096
EXPENSES:
Management fee--Note 3(a) 192,814
Distribution fees--Note 3(b) 128,543
Shareholder servicing costs--Note 3(c) 100,172
Custodian fees 51,713
Auditing fees 31,364
Registration fees 13,588
Prospectus and shareholders' reports--Note 3(b) 8,657
Directors' fees and expenses--Note 3(d) 6,689
Legal fees 1,345
Loan commitment fees--Note 2 103
Miscellaneous 3,808
TOTAL EXPENSES 538,796
INVESTMENT (LOSS) (458,700)
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments and foreign currency transactions
5,735,442
Net unrealized appreciation (depreciation) on investments
and foreign currency transactions 11,496,329
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 17,231,771
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 16,773,071
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
November 30, 1999 Year Ended
(Unaudited) May 31, 1999
- --------------------------------------------------------------------------------
OPERATIONS ($):
Investment income (loss)--net (458,700) 14,299
Net realized gain (loss) on investments 5,735,442 (1,790,038)
Net unrealized appreciation (depreciation)
on investments 11,496,329 (9,868,963)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 16,773,071 (11,644,702)
- --------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS FROM ($):
NET REALIZED GAIN ON INVESTMENTS -- (1,873,154)
- --------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 20,939,604 41,284,693
Dividends reinvested -- 1,783,764
Cost of shares redeemed (27,268,921) (59,105,533)
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL STOCK TRANSACTIONS (6,329,317) (16,037,076)
TOTAL INCREASE (DECREASE) IN NET ASSETS 10,443,754 (29,554,932)
- --------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 48,372,009 77,926,941
END OF PERIOD 58,815,763 48,372,009
Undistributed investment income (loss)--net (442,203) 16,497
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 1,538,216 3,197,037
Shares issued for dividends reinvested -- 144,904
Shares redeemed (1,971,764) (4,572,974)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (433,548) (1,231,033)
SEE NOTES TO FINANCIAL STATEMENTS.
FINANCIAL HIGHLIGHTS
The following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
<TABLE>
<CAPTION>
Six Months Ended
November 30, 1999 Year Ended May 31,
--------------------------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning
of period 12.17 14.97 15.83 15.49 13.74 15.20
Investment Operations:
Investment income (loss)--net (.12)(a) .00(b) (.12) (.02) .09 .01
Net realized and unrealized
gain (loss) on investments 4.55 (2.39) 1.17 1.11 1.66 (1.19)
Total from Investment
Operations 4.43 (2.39) 1.05 1.09 1.75 (1.18)
Distributions:
Dividends from investment
income--net -- -- (.01) (.09) -- (.01)
Dividends in excess of
investment income--net -- -- -- (.03) -- (.02)
Dividends from net realized
gain on investments -- (.41) (1.90) (.63) -- (.25)
Total Distributions -- (.41) (1.91) (.75) -- (.28)
Net asset value, end of period 16.60 12.17 14.97 15.83 15.49 13.74
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 36.40(c) (16.02) 8.42 7.36 12.74 (7.81)
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of operating expenses
to average net assets 1.05(c) 2.01 1.92 1.98 2.04 1.92
Ratio of interest expense
and loan commitment fees
to average net assets -- .00(d) .27 -- -- --
Ratio of net investment income
(loss) to average net assets (.89)(c) .02 (.70) (.18) .62 .09
Portfolio Turnover Rate 97.21(c) 232.68 167.19 158.04 96.45 40.15
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 58,816 48,372 77,927 88,694 102,710 137,909
(A) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(B) AMOUNT REPRESENTS LESS THAN $.01 PER SHARE.
(C) NOT ANNUALIZED.
(D) AMOUNT REPRESENTS LESS THAN .01%
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus International Growth Fund (the "fund") is a separate non-diversified
series of Dreyfus International Funds, Inc. (the "Company") which is registered
under the Investment Company Act of 1940, as amended (the "Act"), as an open-end
management investment company and operates as a series company currently
offering two series including the fund. The fund's investment objective is to
provide investors with long-term capital growth. The Dreyfus Corporation (the
" Manager" ) serves as the fund's investment adviser. The Manager is a direct
subsidiary of Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon
Financial Corporation. Premier Mutual Fund Services, Inc. (the "Distributor") is
the distributor of the fund's shares, which are sold to the public without a
sales charge.
The Company accounts separately for the assets, liabilities and operations of
each series. Expenses directly attributable to each series are charged to that
series' operations; expenses which are applicable to all series are allocated
among them on a pro rata basis.
The fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities exchange
on which such securities are primarily traded or at the last sales price on the
national securities market. Securities not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices, except for open
short positions, where the asked price is used for valuation purposes. Bid price
is used when no asked price is available. Securities for which there are no such
valuations are valued at fair value as determined in good faith under the
direction of the Board of Directors. Investments denominated in foreign
currencies are translated to U.S. dollars at the prevailing rates of exchange.
Forward currency exchange contracts are valued at the forward rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The fund does not isolate that portion of the
results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and maturities of
short-term securities, sales of foreign currencies, currency gains or losses
realized on securities transactions and the difference between the amount of
dividends, interest, and foreign withholding taxes recorded on the fund's books
and the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains and losses arise from changes in the value of
assets and liabilities other than investments in securities, resulting from
changes in exchange rates. Such gains and losses are included with net realized
and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis. Under the terms of the custody agreement, the fund received net
earnings credits of $1,363 based on available cash balances left on deposit.
Interest earned under this arrangement is included in interest income.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend date.
Dividends from investment income-net and dividends from net realized capital
gain are normally declared and paid annually, but the fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code of 1986, as amended (the "Code"). To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the fund not to distribute such gain.
(E) FEDERAL INCOME TAXES: It is the policy of the fund to continue to qualify as
a regulated investment company, if such qualification is in the The Fun
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
best interests of its shareholders, by complying with the applicable provisions
of the Code, and to make distributions of taxable income sufficient to relieve
it from substantially all Federal income and excise taxes.
The fund has an unused capital loss carryover of approximately $2,043,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to May 31, 1999. If not applied,
the carryover expires in fiscal 2007.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the fund at rates based on prevailing
market rates in effect at the time of borrowings. During the period ended
November 30, 1999, the fund did not borrow under the Facility.
NOTE 3--Management Fee and Other Transactions With Affiliates:
(A) Pursuant to a management agreement with the Manager, the management fee is
computed at the annual rate of .75 of 1% of the value of the fund's average
daily net assets and is payable monthly.
(B) Under the Distribution Plan (the "Plan") adopted pursuant to Rule 12b-1
under the Act, the fund (a) reimburses the Distributor for payments to certain
Service Agents (a securities dealer, financial institution or other industry
professional) for distributing the fund' s shares and (b) pays the Manager,
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, and any
affiliate of either of them for advertising and marketing relating to the fund,
at an aggregate annual rate of .50 of 1% of the value of the fund's average
daily net assets. The Distributor may pay one or more Service Agents in respect
of distribution services. The Distributor determines the amounts, if any, to be
paid to Service Agents under the Plan and the basis o
which such payments are made. The fees payable under the Plan are payable
without regard to actual expenses incurred. The Plan also separately provides
for the fund to bear the costs of preparing, printing and distributing certain
of the fund' s prospectuses and statements of additional information and costs
associated with implementing and operating the Plan, not to exceed the greater
of $100,000 or .005 of 1% of the fund's average daily net assets for any full
fiscal year. During the period ended November 30, 1999, the fund was charged
$130,055 pursuant to the Plan.
(C) Under the Shareholder Services Plan, the fund pays the Distributor at an
annual rate of .25 of 1% of the value of the fund's average daily net assets for
the provision of certain services. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. The Distributor may
make payments to Service Agents in respect of these services. The Distributor
determines the amounts to be paid to Service Agents. During the period ended
November 30, 1999, the fund was charged $64,271 pursuant to the Shareholder
Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended November 30, 1999, the fund was charged $24,688 pursuant to the transfer
agency agreement.
(D) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $2,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(E) A 1% redemption fee is charged and retained by the fund on shares redeemed
within six months following the date of issuance, including redemptions made
through the use of the fund's Exchange privilege.
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding
short-term securities, during the period ended November 30, 1999, amounted to
$48,945,220 and $52,826,562, respectively.
At November 30, 1999, accumulated net unrealized appreciation on investments was
$14,437,745, consisting of $15,414,286 gross unrealized appreciation and
$976,541 gross unrealized depreciation.
At November 30, 1999, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
NOTES
For More Information
Dreyfus International Growth Fund
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
100 Church Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Premier Mutual Fund Services, Inc.
60 State Street
Boston, MA 02109
To obtain information:
BY TELEPHONE Call 1-800-645-6561
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Information can be viewed online or downloaded from:
http://www.dreyfus.com
(c) 2000 Dreyfus Service Corporation 095SA9911
<PAGE>
Dreyfus
Emerging Markets
Fund
SEMIANNUAL REPORT November 30, 1999
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Year 2000 Issues (Unaudited)
The fund could be adversely affected if the computer systems used by Dreyfus and
the fund's other service providers do not properly process and calculate
date-related information from and after January 1, 2000. Dreyfus has taken steps
designed to avoid year 2000-related problems in its systems and to monitor the
readiness of other service providers. In addition, issuers of securities in
which the fund invests may be adversely affected by year 2000-related problems.
This could have an impact on the value of the fund's investments and its share
price.
Contents
THE FUND
- --------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
12 Statement of Assets and Liabilities
13 Statement of Operations
14 Statement of Changes in Net Assets
15 Financial Highlights
16 Notes to Financial Statements
FOR MORE INFORMATION
- ---------------------------------------------------------------------------
Back Cover
The Fund
Dreyfus
Emerging Markets Fund
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus Emerging Markets
Fund, covering the six-month period from June 1, 1999 through November 30, 1999.
Inside, you' ll find valuable information about how the fund was managed during
the reporting period, including a discussion with the fund's portfolio manager,
D. Kirk Henry.
When the reporting period began, it had become evident that more accommodative
monetary policies implemented by central banks worldwide were helping to support
growth in Europe and economic recoveries in Japan and the emerging markets of
Asia, Latin America and Eastern Europe. The prospect of better economic
conditions and the start of banking reform and corporate restructuring helped
support higher stock prices in most international markets.
In Japan, stocks rose as the government implemented long-awaited banking and
financial reforms. European markets also fared relatively well in local currency
terms, but returns for U.S. investors were eroded by currency-related effects.
Emerging markets in Southeast Asia and Latin America have generally leveled off
after producing very attractive gains earlier in the year, before the six-month
reporting period began.
We appreciate your confidence over the past six months, and we look forward to
your continued participation in Dreyfus Emerging Markets Fund.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
December 15, 1999
DISCUSSION OF FUND PERFORMANCE
D. Kirk Henry, Portfolio Manager
How did Dreyfus Emerging Markets Fund perform relative to its benchmark?
For the six-month period ended November 30, 1999, Dreyfus Emerging Markets Fund
produced a total return of 19.82%.(1) This return exceeded that provided by the
fund's benchmark, the Morgan Stanley Capital International Emerging Markets Free
(MSCI/EMF) Index, which produced a total return of 17.53% for the same
period.(2)
We attribute the fund' s strong performance to our stock selection strategy,
which led us to a number of large-sized companies that, in our view, possessed
strong fundamentals and were selling at attractive prices. This short-term
performance demonstrates that investing in emerging markets can be volatile and
that it is important for investors to maintain a long-term perspective.
What is the fund's investment approach?
We use a value-oriented and research-driven approach to security selection
within each market, investing in companies located in emerging market countries
as represented in our benchmark, the MSCI/EMF Index. Countries currently in the
benchmark include Argentina, Brazil, Chile, China, Colombia, the Czech Republic,
Greece, Hungary, India, Indonesia, Israel, Jordan, Korea, Malaysia, Mexico,
Pakistan, Peru, Philippines, Poland, Russia, Sri Lanka, South Africa, Taiwan,
Thailand, Turkey and Venezuela.
When choosing stocks for the fund, we begin by conducting fundamental and
quantitative research that focuses on individual companies rather than broad
economic and industry trends. More specifically, we look for investment
opportunities based on three key factors: VALUE, or how a stock is valued
relative to its intrinsic worth; BUSINESS HEALTH, or a company's overall
efficiency and profitability as measured by its return The Fun
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
on assets and return on equity; and BUSINESS MOMENTUM, or the presence of a
catalyst that appears likely to trigger a price increase in the stock's near
future.
What other factors influenced the fund's performance?
During the past six months, stocks in many emerging markets enjoyed robust
returns as the regions' economies continued to rebound from recession. The
strong performance of emerging market investments was supported by an increase
in global growth, rising commodity prices, and, perhaps most importantly, stock
valuations that, in our opinion, reflected very reasonably priced stocks
In particular, Asia exhibited strong growth during the reporting period, led
primarily by South Korea and India, two countries where we have continued to
find attractive investment opportunities.
Within Latin America, some of the region's strongest gains stemmed from Brazil,
especially its telecommunications companies, followed by Mexico, a country that
continued to benefit from its close proximity and affiliation with the United
States. Argentina, too, has shown progress during the reporting period, albeit
to a lesser degree than Brazil and Mexico.
Other emerging market areas that have rebounded during the past six months
include Greece, Taiwan, Turkey and South Africa.
What is the fund's current strategy?
We have continued to invest the portfolio across approximately 26 countries, to
enable the fund to take advantage of opportunities wherever they present
themselves. Following this strategy, the fund' s strongest gains during the
period stemmed from several holdings identified by our company-by-company
research, including Samsung Electronics, a South Korean semiconductor
manufacturer, Ceske Energeticke Zavody, the electric utility company in the
Czech Republic, and Videsh Sanchar Nigam, the Indian international telephone
company that is benefiting from its Internet services. Other positive
contributors to performance included Malaysia' s Berjaya
Sports Toto, a gaming and lottery firm, Pohang Iron & Steel, South Korea's steel
company, the State Bank of India, Hellenic Petroleum, Greece's oil company, and
Del Monte Royal Foods, a South African firm that owns the rights to sell under
the Del Monte brand name in Europe and parts of Asia.
On the other hand, the fund' s performance was held back by our holdings in
Mahanagar Telephone Nigam (MTNL, Ser.B) , India' s local domestic telephone
company, and Desc, a Mexican conglomerate that operates numerous companies
manufacturing auto parts, food, chemical and pharmaceutical products. Finally,
our holdings in Banco do Estado, a Brazilian bank, also hindered returns because
of concerns over governmental privatization actions.
We believe that our diversification and security selection strategies continued
to position the fund to take advantage of investment opportunities in the
emerging markets. Historically, the two main drivers of emerging market stock
market performance have been increased global growth and climbing commodity
prices. We are encouraged that both of these factors have been present over the
past six months.
December 15, 1999
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE AND INVESTMENT
RETURN FLUCTUATE SUCH THAT UPON REDEMPTION FUND SHARES MAY BE WORTH MORE OR LESS
THAN THEIR ORIGINAL COST.
(2) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- THE MORGAN STANLEY CAPITAL
INTERNATIONAL EMERGING MARKETS FREE (MSCI/EMF) INDEX IS A MARKET
CAPITALIZATION-WEIGHTED INDEX COMPOSED OF COMPANIES REPRESENTATIVE OF THE MARKET
STRUCTURE OF 26 EMERGING MARKET COUNTRIES IN EUROPE, LATIN AMERICA AND THE
PACIFIC BASIN.
The Fund
STATEMENT OF INVESTMENTS
November 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
COMMON STOCKS--91.3% Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
ARGENTINA--.9%
<S> <C> <C>
Banco Hipotecario 39,632 533,104
Telefonica de Argentina, ADS 33,800 889,362
1,422,466
BRAZIL--6.5%
Companhia Vale do Rio Doce 10,500 202,847
Companhia Vale do Rio Doce, ADS 108,200 2,590,038
Petroleo Brasileiro 9,080 1,510,972
Tele Celular Sul, ADS 75,800 1,516,000
Tele Centro Oeste Celular, ADS 59,000 236,000
Tele Norte Leste, ADS 17,700 315,281
Telecomunicacoes Brasileiras, ADS (PFD Block) 34,600 3,139,950
Ultrapar, ADS 51,200 540,800
10,051,888
CHILE--3.7%
Administradora de Fondos de
Pensiones Provida, ADS 51,600 1,061,025
Compania de Telecomunicaciones de Chile, ADS 80,400 1,477,350
Cristalerias de Chile, ADS 95,900 1,252,694
Quinenco, ADS 132,400 1,175,050
Santa Isabel, ADS 70,825(a) 717,103
5,683,222
CHINA--4.2%
Beijing Datang Power Generation 4,695,000 936,957
Guangdong Kelon Electrical, Cl. H 1,053,000 908,355
Guangshen Railway, Cl. H 6,235,000 714,461
Guangshen Railway, ADS 110,000 632,500
Huaneng Power International, ADS 39,900 423,937
Shandong Huaneng Power, ADS 183,400 917,000
Shandong International Power Development 3,701,000 514,630
Shenzen Expressway 4,157,000 642,264
Zhejiang Expressway, Cl. H 5,014,000 806,950
6,497,054
CROATIA--1.4%
Pliva d.d., GDR 187,800(b) 2,281,770
COMMON STOCKS (CONTINUED) Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
CZECH REPUBLIC--.7%
Ceske Energeticke Zavody 441,467(a) 1,116,613
Komercni Banka, GDR 2(a,b) 16
1,116,629
EGYPT--2.9%
Commercial International Bank, GDR 67,600(b) 831,480
Misr International Bank, GDR 86,600(b) 887,650
Paints & Chemical Industries, GDR 256,000(b) 1,337,600
Suez Cement 94,800(b) 1,531,020
4,587,750
GREECE--2.6%
Hellenic Telecommunications Organization 595 12,763
Hellenic Telecommunications Organization, ADS 379,555 4,080,216
4,092,979
HONG KONG--2.6%
APT Satellite 545,500(a) 316,053
APT Satellite, ADR 258,000(a) 1,225,500
Asia Aluminum 2,245,000 260,142
China Hong Kong Photo Products 1,925,000 260,239
Hengan International 3,155,000 863,198
Hong Kong Aircraft Engineering 219,000 369,375
Mandarin Oriental International 946,000 666,930
3,961,437
HUNGARY--3.9%
BorsodChem 17,000 519,434
EGIS 15,035 470,729
Gedeon Richter 10,200 524,966
MOL Magyar Olaj-es Gazipari 89,900 1,739,102
Magyar Tavkozlesi, ADR 44,900 1,355,419
OTP Bank 13,000 613,877
Pick Szeged 21,304 795,503
6,019,030
INDIA--11.1%
BSES 84,100(b) 1,101,710
Bajaj Auto, GDR 153,600(b) 1,812,480
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
INDIA (CONTINUED)
Gas Authority of India, GDR 186,100(a,b)1,758,645
Hindalco Industries 45,300(b) 1,075,875
Indian Hotels 161,300(b) 1,375,083
Mahanagar Telephone Nigam 376,400 3,340,550
Mahindra & Mahindra 52,200(b) 502,425
Pentafour Software & Exports, GDR 18,300 699,975
Reliance Industries, GDR 106,200(b) 1,431,045
State Bank of India, GDR 134,000(b) 1,658,250
Steel Authority of India, GDR 43,100(a,b) 172,400
Tata Engineering & Locomotive, GDR 134,300(b) 738,650
Videsh Sanchar Nigam, GDR 67,000(b) 1,541,000
17,208,088
INDONESIA--2.1%
PT Daya Guna Samudera 1,375,000(a) 441,126
PT Indah Kiat Pulp & Paper 3,335,500(a) 1,183,932
PT Indosat, ADR 81,600 1,132,200
PT Indorama Synthetics 555,000(a) 106,075
PT Telekomunikasi Indonesia, ADR 54,300 458,156
3,321,489
ISRAEL--3.8%
ECI Telecom 62,200 1,558,887
Bank Hapoalim 565,600 1,492,080
Bank Leumi Le-Israel 614,600 1,131,745
Blue Square-Israel, ADS 39,050 478,363
Supersol 422,341(a) 1,267,902
5,928,977
LUXEMBOURG--.6%
Quilmes Industrial, ADS 78,100 907,913
MALAYSIA--1.7%
Jaya Tiasa 211,000 369,250
Kwantas 251,000 149,609
Petronas Dagangan 728,000 750,990
Petronas Gas 264,000 534,947
Sime Darby 767,000 904,253
2,709,049
MEXICO--9.0%
ALFA, Ser. A 324,000 1,406,005
ARA 1,060,000(a) 1,417,082
COMMON STOCKS (CONTINUED) Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
MEXICO (CONTINUED)
Apasco 238,000 1,585,825
Cintra 1,028,900 556,752
Controladora Comercial Mexicana, GDS 34,300 731,019
Desc, Ser. B 2,099,800 1,871,440
Embotelladoras Argos 1,546,600 1,394,812
Grupo Continental 799,900 1,186,483
Grupo Financiero Inbursa, Ser. B 277,800 1,025,723
Tablex 66,108 112,226
Telefonos de Mexico, ADS 17,300 1,601,331
Tubes de Acero de Mexico, ADR 83,300 1,046,456
13,935,154
PANAMA--1.3%
Banco Latinoamericano de Exportaciones 81,100 1,946,400
PERU--1.6%
Telefonica del Peru, ADS 191,300 2,474,944
PHILIPPINES--3.9%
First Philippine 879,860 718,910
La Tondena Distillers 874,400 714,449
Manila Electric, Cl. B 977,890 2,504,352
Philippine Long Distance Telephone, ADS 61,300 1,256,650
Universal Robina 5,016,600 807,550
6,001,911
POLAND--2.3%
Bank Polska Kasa Opieki Grupa Pekao 144,000(a) 1,613,207
Polski Koncern Naftowy, GDR 124,300(a,b)1,292,720
Telekomunikacja Polska 49,000 265,802
Telekomunikacja Polska, GDR 83,600(b) 470,250
3,641,979
SINGAPORE--1.6%
Creative Technology 60,300 874,350
Elec & Eltek International 191,000 714,340
Golden Agri-Resources 2,046,000(a) 849,090
2,437,780
SOUTH AFRICA--8.8%
ABSA 521,762 1,967,798
Barlow 291,885 1,698,489
Barlow, ADR 40 230
Del Monte Royal Foods 1,030,000 866,947
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
SOUTH AFRICA (CONTINUED)
Edgars Consolidated Stores 950 10,610
Liberty Life Association of Africa 57,311 570,513
Murray & Roberts 1,156,100 926,302
Nampak 113,300 311,767
OTK 1,527,800 823,499
Pretoria Portland Cement 249,143 1,935,718
Sappi 165,500 1,484,089
Sasol 131,000 993,420
Tiger Oats 208,000 1,993,137
13,582,519
SOUTH KOREA--8.6%
Housing & Commercial Bank, GDR 35,600(a,b) 986,120
Kookmin Bank, ADR 75,513(b) 1,213,871
Korea Electric Power, ADS 158,400 3,168,000
Korea Fine Chemical 9,090 330,118
Pohang Iron & Steel, ADS 55,400 1,990,937
SK 78,710 1,982,603
SK (Rights) 11,699 118,075
SK Telecom, ADS 74,174 1,756,997
Samsung Display Devices 25,000 1,332,758
Youngone 220,000 442,182
13,321,661
TAIWAN--3.2%
China Steel 2,160,000 1,534,333
Ritek, GDR 119,700(a,b)1,346,625
Standard Foods Taiwan 1,036,000 896,177
Yageo 1,300,000(a) 1,239,463
5,016,598
THAILAND--.3%
Saha-Union 400,000 139,726
Thai Farmers Bank 266,100(a) 358,166
497,892
TURKEY--1.0%
Hurriyet Gazetecilik ve Matbaacilik 70,790,000 901,801
Uzel Makina Sanayii, ADR 41,800(b) 683,430
1,585,231
COMMON STOCKS (CONTINUED) Shares Value ($)
- ---------------------------------------------------------------------------------------------------------------------------
UNITED KINGDOM--1.0%
Old Mutual 682,700(a) 1,492,347
TOTAL COMMON STOCKS
(cost $142,789,039) 141,724,157
- ---------------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS--3.9%
- ---------------------------------------------------------------------------------------------------------------------------
BRAZIL--3.3%
Banco do Estado de Sao Paulo 36,100 1,173,297
Companhia Cimento Portlans Itau 13,390 1,712,918
Companhia Energetica de Minas Gerais 69,517 1,307,201
Companhia Paranaense de Energia-Copel 64,800 500,406
Petroleo Brasileiro 1,900 383,853
5,077,675
THAILAND--.6%
Siam Commercial Bank 915,000 967,664
TOTAL PREFERRED STOCKS
(cost $5,770,072) 6,045,339
- -----------------------------------------------------------------------------------------------------------------------------
Principal
SHORT-TERM INVESTMENTS--5.1% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY BILLS:
4.59%, 12/9/1999 112,000 111,890
4.55%, 12/16/1999 290,000 289,669
4.64%, 12/23/1999 188,000 187,530
5.25%, 1/13/2000 1,409,000 1,400,067
4.98%, 1/20/2000 1,117,000 1,108,958
4.98%, 2/3/2000 2,279,000 2,258,580
5.06%, 2/10/2000 2,528,000 2,502,771
TOTAL SHORT-TERM INVESTMENTS
(cost $7,859,874) 7,859,465
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $156,418,985) 100.3% 155,628,961
LIABILITIES, LESS CASH AND RECEIVABLES (.3%) (423,425)
NET ASSETS 100.0% 155,205,536
A NON-INCOME PRODUCING.
B SECURITIES EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM REGISTRATION,
NORMALLY TO QUALIFIED INSTITUTIONAL BUYERS. AT NOVEMBER 30, 1999, THESE
SECURITIES AMOUNTED TO $26,030,115 OR APPROXIMATELY 16.8% OF NET ASSETS.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1999 (Unaudited)
Cost Value
- --------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 156,418,985 155,628,961
Cash 495,182
Cash denominated in foreign currencies 1,021,210 1,027,500
Receivable for investment securities sold 612,381
Dividends receivable 252,004
Receivable for shares of Common Stock subscribed 175,124
Prepaid expenses 5,382
158,196,534
- --------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 151,581
Due to Distributor 30,316
Payable for investment securities purchased 2,608,025
Payable for shares of Common Stock redeemed 70,817
Net unrealized (depreciation) on forward currency
exchange contracts--Note 4 (a) 1,190
Accrued expenses 129,069
2,990,998
- --------------------------------------------------------------------------------
NET ASSETS ($) 155,205,536
- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 140,932,070
Accumulated undistributed investment income--net 1,118,732
Accumulated net realized gain (loss) on investments and
foreign currency transactions 13,941,149
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currency transactions (786,415)
- --------------------------------------------------------------------------------
NET ASSETS ($) 155,205,536
- --------------------------------------------------------------------------------
SHARES OUTSTANDING
(100 million shares of $.001 par value Common Stock authorized) 10,315,593
NET ASSET VALUE, offering and redemption price per share--Note 3(d) ($) 15.05
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF OPERATIONS
Six Months Ended November 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INCOME:
Cash dividends (net of $82,951 foreign taxes withheld at source) 1,365,631
Interest 147,076
TOTAL INCOME 1,512,707
EXPENSES:
Management fee--Note 3(a) 773,982
Shareholder servicing costs--Note 3(b) 177,286
Custodian fees 152,623
Professional fees 19,447
Registration fees 19,302
Directors' fees and expenses--Note 3(c) 17,480
Prospectus and shareholders' reports 11,419
Loan commitment fees--Note 2 1,261
Miscellaneous 819
TOTAL EXPENSES 1,173,619
INVESTMENT INCOME--NET 339,088
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments and foreign currency
transactions 18,703,182
Net realized gain (loss) on forward currency exchange contracts (42,438)
NET REALIZED GAIN (LOSS) 18,660,744
Net unrealized appreciation (depreciation) on investments and
foreign currency transactions 2,305,441
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 20,966,185
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 21,305,273
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
November 30, 1999 Year Ended
(Unaudited) May 31, 1999
- --------------------------------------------------------------------------------
OPERATIONS ($):
Investment income--net 339,088 938,568
Net realized gain (loss) on investments 18,660,744 (3,529,255)
Net unrealized appreciation (depreciation)
on investments 2,305,441 10,850,462
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 21,305,273 8,259,775
- --------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS ($):
From investment income--net -- (549,186)
In excess of net realized gains on investments -- (122,041)
TOTAL DIVIDENDS -- (671,227)
- --------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 51,166,093 40,241,287
Dividends reinvested -- 389,280
Cost of shares redeemed (11,643,578) (28,754,128)
Redemption fee 23,619 61,154
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL STOCK TRANSACTIONS 39,546,134 11,937,593
TOTAL INCREASE (DECREASE) IN NET ASSETS 60,851,407 19,526,141
- --------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 94,354,129 74,827,988
END OF PERIOD 155,205,536 94,354,129
Undistributed investment income--net 1,118,732 779,644
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 3,636,595 3,739,409
Shares issued for dividends reinvested -- 41,501
Shares redeemed (837,192) (2,955,313)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 2,799,403 825,597
SEE NOTES TO FINANCIAL STATEMENTS.
FINANCIAL HIGHLIGHTS
The following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
<TABLE>
<CAPTION>
Six Months Ended
November 30, 1999 Year Ended May 31,
-------------------------------
(Unaudited) 1999 1998 1997(a)
- -----------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
<S> <C> <C> <C> <C>
Net asset value, beginning of period 12.55 11.18 14.21 12.50
Investment Operations:
Investment income--net .04(b) .14 .04 .05
Net realized and unrealized
gain (loss) on investments 2.46 1.33 (2.62) 1.70
Total from Investment Operations 2.50 1.47 (2.58) 1.75
Distributions:
Dividends from investment income--net -- (.09) (.02) (.02)
Dividends from net realized gain on investments -- (.02) (.24) (.02)
Dividends in excess of net realized gain
on investments -- -- (.20) --
Total Distributions -- (.11) (.46) (.04)
Redemption fee added to paid-in capital .00(c) .01 .01 --
Net asset value, end of period 15.05 12.55 11.18 14.21
- -----------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 19.82(d) 13.56 (18.11) 14.07(d)
- -----------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average net assets .95(d) 1.88 1.94 1.85(d)
Ratio of net investment income
to average net assets 1.22(d) 1.42 .54 .70(d)
Decrease reflected in above expense ratios
due to undertakings by the Manager -- -- .00(e) .36(d)
Portfolio Turnover Rate 61.57(d) 87.81 87.46 52.52(d)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period ($ x 1,000) 155,206 94,354 74,828 50,382
A FROM JUNE 28, 1996 (COMMENCEMENT OF OPERATIONS) TO MAY 31, 1997.
B BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
C AMOUNT REPRESENTS LESS THAN $.01.
D NOT ANNUALIZED.
E AMOUNT REPRESENTS LESS THAN .01%.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus Emerging Markets Fund (the "fund") is a separate non-diversified series
of Dreyfus International Funds, Inc. (the "Company"), which is registered under
the Investment Company Act of 1940, as amended (the "Act"), as an open-end
management investment company and operates as a series company currently
offering two series, including the fund. The fund's investment objective is
long-term capital appreciation. The Dreyfus Corporation (the "Manager") serves
as the fund's investment adviser. The Manager is a direct subsidiary of Mellon
Bank, N.A., which is a wholly-owned subsidiary of Mellon Financial Corporation.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor of the
fund's shares, which are sold to the public without a sales charge.
The Company accounts separately for the assets, liabilities and operations of
each series. Expenses directly attributable to each series are charged to that
series' operations; expenses which are applicable to all series are allocated
among them on a pro rata basis.
The fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities exchange
on which such securities are primarily traded or at the last sales price on the
national securities market. Securities not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices, except for open
short positions, where the asked price is used for valuation purposes. Bid price
is used when no asked price is available. Securities for which there are no such
valuations are valued at fair value as determined in good faith under the
direction of the Board of Directors. Investments denominated in foreign
currencies are translated to U.S. dollars at the prevailing rates of exchange.
Forward currency exchange contracts are valued at the forward rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The fund does not isolate that portion of the
results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and maturities of
short-term securities, sales of foreign currencies, currency gains or losses
realized on securities transactions and the difference between the amount of
dividends, interest and foreign withholding taxes recorded on the fund's books
and the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains and losses arise from changes in the value of
assets and liabilities other than investments in securities, resulting from
changes in exchange rates. Such gains and losses are included with net realized
and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis. Under the terms of the custody agreement, the fund received net
earnings credits of $974 during the period ended November 30, 1999 based on
available cash balances left on deposit. Income earned under this arrangement is
included in interest income.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend date.
Dividends from investment income-net and dividends from net realized capital
gain are normally declared and paid annually, but the fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code of 1986, as amended (the "Code"). To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the fund not to distribute such gain.
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
(E) FEDERAL INCOME TAXES: It is the policy of the fund to continue to qualify as
a regulated investment company, if such qualification is in the best interests
of its shareholders, by complying with the applicable provisions of the Code,
and to make distributions of taxable income sufficient to relieve it from
substantially all Federal income and excise taxes.
The fund has an unused capital loss carryover of approximately $1,031,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to May 31, 1999. This amount is
calculated based on Federal income tax regulations which may differ from
financial reporting in accordance with generally accepted accounting principles.
If not applied, the carryover expires in fiscal 2007.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the fund at rates based on prevailing
market rates in effect at the time of borrowings. During the period ended
November 30, 1999, the fund did not borrow under the Facility.
NOTE 3--Management Fee and Other Transactions With Affiliates:
(A) Pursuant to a management agreement with the Manager, the management fee is
computed at the annual rate of 1.25% of the value of the fund's average daily
net assets and is payable monthly.
(B) Under the Shareholder Services Plan, the fund pays the Distributor at an
annual rate of .25 of 1% of the value of the fund's average daily net assets for
the provision of certain services. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the fund and providing reports and other information, and
services related to the maintenance
of shareholder accounts. The Distributor may make payments to Service Agents (a
securities dealer, financial institution or other industry professional) in
respect of these services. The Distributor determines the amounts to be paid to
Service Agents. During the period ended November 30, 1999, the fund was charged
$154,796 pursuant to the Shareholder Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended November 30, 1999, the fund was charged $17,145 pursuant to the transfer
agency agreement.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $2,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(D) A 1% redemption fee is charged and retained by the fund on shares redeemed
within six months following the date of issuance, including redemptions made
through the use of the fund's exchange privilege.
NOTE 4--Securities Transactions:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts, during
the period ended November 30, 1999, amounted to $108,974,538 and $72,213,134,
respectively.
The following summarizes open forward currency exchange contracts at November
30, 1999:
<TABLE>
<CAPTION>
Foreign
Forward Currency Currency Unrealized
Exchange Contracts Amounts Cost ($) Value ($) (Depreciation) ($)
- ------------------------------------------------------------------------------------------------------------------------------------
PURCHASES:
<S> <C> <C> <C> <C>
South African Rand,
expiring 12/2/99 2,435,010 394,973 394,142 (831)
SALES: PROCEEDS ($)
Mexican Peso,
expiring 12/2/99 914,346 96,654 97,013 (359)
TOTAL (1,190)
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
</TABLE>
The fund enters into forward currency exchange contracts in order to hedge its
exposure to changes in foreign currency exchange rates on its foreign portfolio
holdings and to settle foreign currency transactions. When executing forward
currency exchange contracts, the fund is obligated to buy or sell a foreign
currency at a specified rate on a certain date in the future. With respect to
sales of forward currency exchange contracts, the fund would incur a loss if the
value of the contract increases between the date the forward contract is opened
and the date the forward contract is closed. The fund realizes a gain if the
value of the contract decreases between those dates. With respect to purchases
of forward currency exchange contracts, the fund would incur a loss if the value
of the contract decreases between the date the forward contract is opened and
the date the forward contract is closed. The fund realizes a gain if the value
of the contract increases between those dates. The fund is also exposed to
credit risk associated with counter party nonperformance on these forward
currency exchange contracts which is typically limited to the unrealized gain on
each open contract.
(B) At November 30, 1999, accumulated net unrealized depreciation on investments
and forward currency exchange contracts was $791,214, consisting of $11,113,502
gross unrealized appreciation and $11,904,716 gross unrealized depreciation.
At November 30, 1999, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
For More Information
Dreyfus Emerging Markets Fund
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
100 Church Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Premier Mutual Fund Services, Inc.
60 State Street
Boston, MA 02109
To obtain information:
BY TELEPHONE Call 1-800-645-6561
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Information can be viewed online or downloaded from:
http://www.dreyfus.com
(c) 2000 Dreyfus Service Corporation 327SA9911
