DREYFUS LIFETIME PORTFOLIOS, INC.
LETTER TO SHAREHOLDERS
Dear Shareholder:
The six months ended March 31, 1997, which marked the semi-annual fiscal
period for Dreyfus LifeTime Portfolios, Inc. were a volatile time for both
the stock and bond markets. Nonetheless, the three Portfolios of your Fund
provided returns that, while somewhat lower than for the previous fiscal
period, continued to be rewarding.
The following summarizes the six-month performance ended March 31, 1997:
<TABLE>
<CAPTION>
Lehman Brothers
Intermediate
Customized Standard & Poor's 500 Government/Corporate
Portfolio Portfolio Blended Index Composite Stock Price Index Bond Index
(Class) Total Return* Total Return** Total Return* Total Return*
---------------- ------------------ ------------------- ---------------------------- -------------------------
<S> <C> <C> <C> <C>
Growth
Institutional Shares 6.93% 7.45% 11.24% 2.33%
Retail Shares 7.06% 7.45%
Growth and Income
Institutional Shares 6.03% 5.68%
Retail Shares 5.31% 5.68%
Income
Institutional Shares 3.57% 4.21%
Retail Shares 3.72% 4.21%
</TABLE>
A customized blended index is utilized by each Portfolio in order to
provide a more accurate performance comparison to the
respective Portfolio's baseline asset allocation. For each Portfolio, the
customized blended index reflects the target percentages of stocks, bonds and
money market instruments, weighted by the return of the broad market index
that is representative for the particular asset class, as set forth in the
Fund's Prospectus. Performance for the Standard & Poor's 500 Composite Stock
Price Index has been included as a large cap equity benchmark, the largest
asset class among the five asset classes of the Growth Portfolio and the
Growth and Income Portfolio. (See Portfolio Focus section of this letter.)
The Lehman Brothers Government/Corporate Intermediate Bond Index is the
broad-based securities benchmark for the Income Portfolio.
The following report describes the general economic situation and the
market environment in which the Fund operated in recent months, and then
explains the policies and market strategies for each Portfolio.
Economic Review
The March 25th hike in the Federal Funds rate signaled that the Federal
Reserve Board (the "Fed") finally lost confidence in its earlier prognosis of
an imminent economic slowdown. Measured on a quarterly basis, the economy
grew 3.2% between January 1 and December 31, 1996, and recent evidence
suggests a growth acceleration in early 1997. A tighter labor market is
becoming inevitable, posing the risk that higher wages will ultimately
translate into higher prices. As yet, however, prices are subdued by the
strong dollar. Market interest rates rose in recent weeks in anticipation of
the Fed's move and they remain vigilant in case of any need for more credit
tightening.
New evidence suggests why the Fed might need to take further action.
First, the tight labor market is fueling strong consumer spending. Second,
the housing industry is buoyant. Third, capital goods and export orders are
recently recovering after several sluggish months. In all, demand is
broadening to more sectors, depleting inventories and boosting production and
imports. Moreover, with this year's pickup in international trade, many
foreign economies are also starting to enjoy faster growth.
Although wage inflation has escalated since last summer, price inflation
has so far remained steady. Hence, real wages are rising, adding to the sense
of well-being that is boosting spending. In many instances, rising wages are
the reward for rising productivity. However, the labor shortage is also
boosting wage offers; those companies which must pay up, but cannot raise
prices, may see their profits slow. Profits are also under pressure at
multinational companies that have not hedged the higher dollar, and are
vulnerable at companies that compete with imports. Overall, however, we
expect profits to grow steadily in 1997.
Market interest rates moved higher in recent weeks, preceding the Fed's
25 basis-point increase in the Federal Funds rate. Both short-term and
long-term rates currently anticipate more tightening in coming months.
Moreover, expectations for further rate hikes are also boosting the dollar. A
rising dollar can suppress price inflation, but it also poses the risks of
strong import growth and a wider trade deficit.
The economy has just begun a seventh year of noninflationary growth for
this business cycle. While the Fed has embarked on a tightening process, the
primary impact is likely to temper strong demand, allowing a more sustainable
growth rate. We continue to believe that a long cycle is likely.
Market Overview
The long-expected correction in stock market prices finally occurred
starting in late March, after the Federal Reserve Open Market Committee
raised interest rates by a quarter point.
The Fed's move, the first to increase interest rates in two years, had
been widely heralded. In fact, only a short time earlier, Fed Chairman Alan
Greenspan had told Congress that inflation appeared to remain "quiescent."
The boost in short-term rates was the smallest the Fed could authorize - only
25 basis points.
The Fed's move reminded stock investors and traders that stock prices had
moved to the stratosphere over many months, reaching almost 7100 on the Dow
Jones Industrial Average just before the latest Fed intervention. Suddenly
even owners of blue chip stocks, the kind that had been leading the market
lately, had second thoughts about valuations. The less prestigious Nasdaq
stocks, particularly those based on high technology, which had been lagging
the market for several months, went into further retreat.
To be sure, by the end of trading March 31 the DJIA was still up 2.60%
for the year, and the Standard & Poor's 500 was up 2.69% though the Nasdaq
Composite was down 5.37%. Many stocks were hurt much more than these
averages. According to a brokerage firm calculation quoted in the Wall Street
Journal, 55% of stocks in the Nasdaq had fallen 20% or more below their
recent highs by March 31. For stocks listed on the New York Stock Exchange,
the percentage was 24%, and for the S&P 500, it was 30%.
Even so, the American economy continued to be strong, as described in the
"Economic Review" section of this letter. Now that the Fed has raised
interest rates once, and may do so again later in the year, the prospects for
corporate profits have become more important than ever for stock market
valuations. So far this year, profit levels, while not as robust as those in
1996, have contained some pleasant surprises for investors. If this can be
maintained for the rest of the year, the recent stock market adjustment may
eventually be regarded as no more than a bump in the upward road. One hopeful
sign is that mutual fund equity investors have not engaged in wholesale
redemptions despite the retreat in net asset values of their shares.
Nonetheless, the tone of the market remains highly nervous, susceptible to
unexpected developments.
Portfolio Focus
As you know, the Dreyfus LifeTime Portfolios provide the opportunity to
invest in three distinct portfolios that are specifically designed for
investors with differing time horizons and tolerance for risk.
The Growth Portfolio is designed for the investor with the highest risk
tolerance and/or the longest time horizon. This portfolio has the highest
baseline allocation to the equity markets, with the ability to shift
considerably from that baseline in line with Mellon Equity's disciplined
asset allocation process. The Growth Portfolio was at its maximum equity
position over the last six months, which precludes holding any bonds. At the
end of the period, the portfolio was invested 70% in large capitalization
equities, 17% in small capitalization equities, and 10.5% in the
international equity markets. Domestic equities outperformed bonds during the
period, but this was exclusively attributable to large capitalization
equities as small capitalization issues underperformed both bonds and large
capitalization stocks. The international equity allocation ended the period
slightly under the baseline allocation.
The Growth and Income Portfolio is designed for an investor with a
moderate tolerance for risk and/or intermediate time horizon. Like the Growth
Portfolio, it remained at its maximum equity position for the period, which
is lower, due to its more moderate risk profile. At the period's end, 49% of
the portfolio was invested in large capitalization stocks and 12% in small
caps, compared to the baseline allocations of 36% and 9%, respectively. Bonds
remained underweight at 33% compared to a normal allocation of 45%. The
international equity allocation was just under its long-term allocation of
5%. As with the Growth Portfolio, the over weighting of domestic equities
proved beneficial due exclusively to the out performance of large
capitalization equities. As market conditions warrant, we may change the
asset class allocation for the Growth and Growth & Income Portfolios at any
time.
The Income Portfolio is designed for the more conservative investor. Its
asset allocation is bond dominated, and does not vary from its long-term
targets. The bond and stock components are both passively managed. This
portfolio underperformed its customized benchmark due to deductions for
portfolio fees and expenses.
The large capitalization equity component of both the Growth and Growth
and Income Portfolios are actively managed using Mellon Equity's quantitative
equity discipline. Sector allocations mirror those of the S&P 500, with
portfolio performance relative to the benchmark dependent on stock selection.
During the last six months, the large capitalization equity portfolio
modestly underperformed the S&P 500. Stock issues that detracted from
performance included 3 Com Corp, Cisco Systems, Tupperware Corp, and TJX
Companies, while Microsoft, Safeway, New York Times, and Applied Materials
benefited the portfolio's performance.
We appreciate your investment in Dreyfus LifeTime Portfolio and will
continue to exert our best efforts on your behalf.
Sincerely,
(Steven A. Falci President Logo)
Steven A. Falci
Portfolio Manager
April 23, 1997
New York, NY
* Total return includes reinvestment of dividends and any capital gains paid.
** For the Growth Portfolio, the Customized Blended Index has been
prepared by the Fund for purposes of more accurate comparison to the
Portfolio's overall portfolio composition. We have combined the performance
of unmanaged indices reflecting the baseline percentages set forth in the
Prospectus, but in greater detail than the broader Prospectus Baseline
percentages: Domestic Large Company Stocks _ 54.4%; Domestic Small Company
Stocks _ 13.6%; Foreign Stocks _ 12.0%; Domestic Bonds _ 17.0%; and Foreign
Bonds _ 3.0%. The Customized Blended Index combines returns from the Standard
& Poor's 500 Composite Stock Price Index ("S&P 500 Index"), the Russell 2000
Index, the Morgan Stanley Capital International Europe, Australasia, Far East
(Free) Index _ hedged, $U.S. ("EAFE" Index); the Lehman Brothers Intermediate
Government/Corporate Bond Index ("Lehman Index") and the J.P. Morgan Non-U.S.
Government Bond Index_Hedged ("J.P. Morgan Global Index") and is weighted to
the aforementioned Baseline percentages. The S&P 500 Index is a widely
accepted, unmanaged index of overall stock market performance. The Russell
2000 Index is an unmanaged index and is composed of the 2,000 smallest
companies in the Russell 3000 Index. The Russell 3000 Index is composed of the
largest U.S. companies by market capitalization. The EAFE Index, which is
the property of Morgan Stanley & Co., Incorporated, 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 Lehman Index is a widely accepted, unmanaged index of Government and
Corporate bond market performance composed of U.S. Government Treasury and
agency securities, fixed-income securities and nonconvertible investment
grade corporate debt, with an average maturity of 1_10 years. The J.P. Morgan
Global Index is an index that measures returns on bonds from 12 world
markets, hedged into U.S. dollars. This index does not include a U.S. Bonds
component. None of the foregoing indices reflect account charges, fees or
other expenses.
For the Growth and Income Portfolio, we have combined the performance of
unmanaged indices reflecting the baseline percentages set forth in the
Prospectus, but in greater detail than the broader Prospectus Baseline
percentages: Domestic Large Company Stocks _ 36%; Domestic Small Company
Stocks _ 9%; Foreign Stocks _ 5%; Domestic Bonds _ 45%; and Foreign Bonds _
5%. The Customized Blended Index combines returns from the S&P 500 Index, the
Russell 2000 Index, the EAFE Index, the Lehman Index and the J.P. Morgan
Global Index and is weighted to the aforementioned Baseline percentages. The
indices are described above.
For the Income Portfolio, we have combined the performance of unmanaged
indices reflecting the baseline percentages set forth in the Prospectus, but
in greater detail than the broader Prospectus Baseline percentages: Bonds _
67.5%; Stocks _ 22.5%; and Treasury Bills _ 10%. The Customized Blended Index
combines returns from the Lehman Index, the S&P 500 Index (described above)
and the 90-day Treasury Bill rate, as it changes from time to time, and is
weighted to the aforementioned Baseline percentages.
<TABLE>
<CAPTION>
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio
STATEMENT OF INVESTMENTS MARCH 31, 1997 (UNAUDITED)
Principal
Amount Value
--------------- -----------
<S> <C> <C> <C> <C>
Bonds and Notes_65.6%
U.S. Government Securities:
U.S. Treasury Bonds;
10.75%, 8/15/2005.................... $600,000 $ 743,062
-------------
U.S. Treasury Notes:
5.625%, 1/31/1998.................... 500,000 498,359
5.875%, 4/30/1998.................... 525,000 523,687
5.875%, 8/15/1998.................... 1,000,000 994,531
5.125%, 11/30/1998................... 770,000 755,322
8.875%, 2/15/1999.................... 805,000 839,464
6%, 8/15/1999........................ 800,000 790,875
7.125%, 9/30/1999.................... 1,000,000 1,013,594
6.25%, 1/31/1997..................... 650,000 636,188
7.50%, 10/31/1999.................... 1,000,000 1,018,281
8.75%, 8/15/2000..................... 1,300,000 1,381,656
5.75%, 10/31/2000.................... 500,000 485,547
5.25%, 1/31/2001..................... 1,200,000 1,143,937
7.75%, 2/15/2001..................... 900,000 932,344
8%, 5/15/2001........................ 1,150,000 1,202,289
7.875%, 8/15/2001.................... 550,000 573,375
7.50%, 11/15/2001.................... 180,000 185,231
6.375%, 8/15/2002.................... 400,000 392,938
6.25%, 2/15/2003..................... 700,000 681,297
7.875%, 11/15/2004................... 110,000 116,188
7.50%, 2/15/2005..................... 1,450,000 1,500,750
6.50%, 5/15/2005..................... 325,000 316,520
6.875%, 5/15/2006.................... 200,000 198,969
6.50%, 10/15/2006.................... 330,000 319,842
-------------
16,501,184
-------------
TOTAL BONDS AND NOTES
(cost $17,656,803)................... $17,244,246
==============
Short-Term Investments_ 33.4%
U.S. Treasury Bills: 5.17%, 4/4/1997........................ $304,000 $ 303,918
5.29%, 4/10/1997....................... 132,000 131,846
5.11%, 4/17/1997....................(a) 7,005,000 6,988,485
5.12%, 4/24/1997....................... 669,000 667,074
5.08%, 5/8/1997........................ 122,000 121,351
5.26%, 5/15/1997....................... 262,000 260,336
5.05%, 5/22/1997....................... 303,000 300,774
-------------
TOTAL SHORT-TERM INVESTMENTS
(cost $8,774,361).................... $ 8,773,784
=============
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Value
-------------
TOTAL INVESTMENTS (cost $26,431,164)........................................ 99.0% $26,018,030
====== =============
CASH AND RECEIVABLES (NET).................................................. 1.0% $ 261,109
====== =============
NET ASSETS.................................................................. 100.0% $26,279,139
====== =============
Notes to Statement of Investments:
(a) Partially held by the custodian in a segregated account as collateral
for open futures positions.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio (continued)
STATEMENT OF FINANCIAL FUTURES MARCH 31, 1997 (UNAUDITED)
Market Value Unrealized
Number of Covered (Depreciation)
Financial Futures Purchased; Contracts by Contracts Expiration at 3/31/97
- ---------------------------- ------------ --------------- -------------- --------------
Standard & Poor's 500........................ 15 5,685,000 June '97 ($314,675)
==============
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth and Income Portfolio
STATEMENT OF INVESTMENTS MARCH 31, 1997 (UNAUDITED)
Common Stocks--46.8% Shares Value
-------------- --------------
Basic Industries_2.4% duPont (E.I.) de Nemours & Co 13,700 $ 1,452,200
Eastman Chemical....................... 4,800 258,000
Fort Howard............................(a) 4,400 136,950
James River............................ 12,800 372,800
Mead................................... 1,900 100,700
Morton International................... 9,100 384,475
Owens-Illinois.........................(a) 7,500 184,688
Praxair................................ 7,400 332,075
Sealed Air.............................(a) 2,900 119,263
Sherwin-Williams....................... 6,300 170,100
--------------
3,511,251
--------------
Capital Spending_10.8% Adaptec................................(a) 4,700 168,025
American Power Conversion..............(a) 7,800 168,675
Applied Materials......................(a) 6,400 296,800
Arrow Electronics......................(a) 5,100 287,512
COMPAQ Computer........................(a) 10,600 812,225
Cabletron Systems......................(a) 15,300 447,525
Case...................................... 2,100 106,575
Caterpillar............................... 16,100 1,292,025
Cisco Systems..........................(a) 18,500 890,313
Cummins Engine............................ 4,100 210,125
Eaton..................................... 4,200 297,675
Gateway 2000...........................(a) 6,600 338,250
General Electric.......................... 10,400 1,032,200
Harnischfeger Industries.................. 3,700 172,050
HealthCare COMPARE.....................(a) 5,300 215,312
Hewlett-Packard........................... 18,100 963,825
Ingersoll-Rand............................ 9,500 414,438
Intel..................................... 13,900 1,933,837
International Business Machines........... 5,200 714,350
Lexmark International Group, Cl.A......(a) 8,200 198,850
Lockheed Martin........................... 4,100 344,400
Lucent Technologies....................... 13,200 696,300
Microsoft..............................(a) 22,400 2,053,800
Oracle.................................(a) 16,600 640,138
Tellabs................................(a) 15,600 563,550
Thiokol................................... 2,600 143,650
U.S. Robotics..........................(a) 2,500 138,437
USA Waste Service......................(a) 4,700 166,850
Wheelabrator Technology................... 2,600 34,125
--------------
15,741,837
--------------
Consumer Cyclical_5.6% Borders Group..........................(a) 6,100 115,138
Boston Chicken.........................(a) 9,200 280,600
Brunswick................................. 7,700 206,937
Chrysler.................................. 15,600 468,000
Disney (Walt)............................. 4,200 306,600
Federated Department Stores............(a) 17,500 575,312
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
-------------- --------------
Consumer Cyclical (continued) Gannett................................... 2,200 $ 188,925
Gap....................................... 22,900 767,150
General Motors............................ 15,100 836,163
Goodyear Tire & Rubber.................... 2,400 125,400
King World Productions.................(a) 5,700 208,050
MGM Grand..............................(a) 5,200 188,500
Magna International, Cl. A................ 2,900 143,913
Maytag.................................... 6,800 140,250
NIKE, Cl. B............................... 6,400 396,800
New York Times, Cl. A..................... 13,200 582,450
News Corp, A.D.R.......................... 4,500 81,000
Reuters Holdings, A.D.S................... 3,500 203,656
Safeway................................(a) 16,000 742,000
Sears, Roebuck & Co....................... 13,800 693,450
TJX....................................... 14,700 628,425
V.F. Corp................................. 4,600 307,625
--------------
8,186,344
--------------
Consumer Non-Durables_.2% Tommy Hilfiger.........................(a) 4,700 245,575
--------------
Consumer Staples_5.8% Avon Products............................. 13,900 729,750
Campbell Soup............................. 14,200 658,525
Coca-Cola................................. 38,800 2,167,950
Dole Food................................. 1,100 41,525
Eastman Kodak............................. 5,600 424,900
General Mills............................. 5,600 347,900
Gillette.................................. 7,300 530,163
Johnson & Johnson......................... 27,800 1,469,925
Philip Morris Cos......................... 13,200 1,506,450
Pioneer Hi-Bred International............. 2,900 182,337
Ralston-Ralston Purina Group.............. 5,600 437,500
--------------
8,496,925
--------------
Energy_4.2% British Petroleum, A.D.S.................. 5,000 686,250
Burlington Resources...................... 8,100 346,275
Chevron.................................. 17,800 1,239,325
Coastal................................... 9,300 446,400
Consolidated Natural Gas.................. 5,200 261,950
Diamond Offshore Drilling..............(a) 4,300 294,550
Exxon..................................... 11,300 1,217,575
Kerr-McGee................................ 2,400 148,500
NICOR..................................... 2,900 92,800
Phillips Petroleum........................ 13,800 564,075
Reading & Bates........................(a) 10,500 237,562
Unocal ................................... 7,000 266,875
Williams Cos.............................. 6,800 302,600
--------------
6,104,737
--------------
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
-------------- --------------
Health Care_4.5% Abbott Laboratories....................... 16,700 $ 937,287
Amgen..................................(a) 14,600 815,775
Becton, Dickinson & Co.................... 5,300 238,500
Biogen.................................(a) 900 33,638
Bristol-Myers Squibb...................... 14,800 873,200
Corning................................... 5,700 252,937
HEALTHSOUTH............................(a) 26,900 514,463
Merck & Co................................ 14,600 1,230,050
Oxford Health Plans....................(a) 7,900 463,137
Pfizer.................................... 4,000 336,500
Schering-Plough........................... 12,700 923,925
--------------
6,619,412
--------------
Interest Sensitive_7.3% AMBAC................................... 4,400 283,800
Ahmanson (H.F.) & Co.................... 4,300 156,950
American National Insurance............. 1,900 148,675
AmSouth Bancorp......................... 6,700 323,275
Banc One................................ 10,800 429,300
BankAmerica............................. 11,400 1,148,550
Barnett Banks........................... 6,100 283,650
Bear Stearns Cos........................ 16,600 435,750
CIGNA................................... 5,900 862,138
Citicorp................................ 6,400 692,800
Comerica................................ 14,800 834,350
Conseco................................. 13,100 466,687
EXEL.................................... 14,700 621,075
Federal National Mortgage Association.. 16,300 588,837
First Chicago NBD...................... 14,300 773,988
Green Tree Financial................... 9,700 327,375
MGIC Investment........................ 2,300 162,725
Norwest................................ 5,000 231,250
Republic New York...................... 2,700 237,937
SouthTrust............................. 3,900 140,888
State Street Boston.................... 4,000 277,500
Student Loan Marketing Association..... 6,500 619,125
Travelers Group........................ 11,400 545,775
--------------
10,592,400
--------------
Mining And Metals_1.1% Aluminum Co. of America................ 1,700 115,600
Phelps Dodge........................... 3,200 234,000
Potash Corp. Saskatchewan.............. 5,200 395,200
USX-Marathon Group..................... 26,000 724,750
USX-U.S. Steel......................... 6,800 181,050
--------------
1,650,600
--------------
Transportation_.7% CSX.................................... 10,100 469,650
Carnival, Cl. A........................ 5,300 196,100
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED)
MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
-------------- --------------
Transportation (continued) Delta Air Lines........................ 4,000 $ 336,500
--------------
1,002,250
--------------
Utilities_4.2% AES..................................(a) 2,500 140,000
Ameritech.............................. 20,500 1,260,750
BellSouth.............................. 21,500 908,375
Consolidated Edison.................... 14,500 435,000
DQE.................................... 7,200 199,800
Edison International................... 14,100 317,250
Entergy................................ 16,400 401,800
MCI Communications..................... 8,200 292,125
Pinnacle West Capital.................. 10,300 310,288
SBC Communications..................... 21,000 1,105,125
Vodafone Group, A.D.R.................. 11,500 507,437
WorldCom............................(a) 7,700 169,400
--------------
6,047,350
--------------
TOTAL COMMON STOCKS
(cost $62,917,681)................... $ 68,198,681
==============
Principal
Notes and Bonds_33.5% Amount
-------------
Basic Industries_.2% duPont (E.I.) deNemours & Co., Deb.,
8.50%, 2/15/2003..................... $250,000 $ 261,935
--------------
Capital Spending_1.3% Oracle, Sr. Notes,
6.72%, 2/15/2004..................... 2,000,000 1,936,298
--------------
Consumer Cyclical_.7% Penney (J.C.), Deb.,
9.05%, 3/1/2001...................... 1,000,000 1,065,806
--------------
Consumer Staples_.7% Phillip Morris, Notes,
7.625%, 5/15/2002.................... 1,000,000 1,010,729
--------------
Health Care_.7% American Home Products, Notes,
7.70%, 2/15/2000..................... 1,000,000 1,022,775
--------------
Interest Sensitive_2.6% American General, Notes,
7.75%, 4/1/2005...................... 500,000 507,171
Associated N.A., Sr. Notes,
6%, 6/15/2000........................ 1,000,000 972,434
Avco Financial, Sr. Notes,
5.50%, 5/1/1998...................... 330,000 326,762
BankAmerica, Sub. Notes,
7.875%, 12/1/2002.................... 1,000,000 1,027,337
Citicorp, Sub. Notes,
6.60%, 8/1/2000...................... 1,000,000 989,379
--------------
3,823,083
--------------
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Principal
Notes and Bonds (continued) Amount Value
-------------- --------------
U.S. Government
& Agencies_27.3% Federal National Mortgage Association,
8.50%, 2/1/2005...................... $500,000 $ 516,698
Tennessee Valley Authority,
6.375%, 6/15/2005.................... 1,950,000 1,865,319
U.S. Treasury Notes:
5.875%, 4/30/1998.................... 2,150,000 2,144,625
5.875%, 8/15/1998.................... 3,400,000 3,381,406
5.125%, 11/30/1998................... 3,100,000 3,040,906
8.875%, 2/15/1999.................... 4,200,000 4,379,813
6.875%, 8/31/1999.................... 2,000,000 2,015,625
7.125%, 9/30/1999.................... 2,000,000 2,027,188
7.875%, 11/15/1999................... 2,000,000 2,063,125
7.75%, 1/31/2000..................... 1,000,000 1,029,531
6.25%, 5/31/2000..................... 1,200,000 1,186,875
8.75%, 8/15/2000..................... 2,650,000 2,816,453
5.625%, 11/30/2000................... 1,100,000 1,062,875
5.25%, 1/31/2001..................... 1,400,000 1,334,594
8%, 5/15/2001........................ 1,175,000 1,228,426
6.625%, 7/31/2001.................... 1,000,000 995,781
6.50%, 8/31/2001..................... 1,000,000 990,781
7.50%, 11/15/2001.................... 1,000,000 1,029,063
6.25%, 2/15/2003..................... 1,000,000 973,281
5.75%, 8/15/2003..................... 130,000 122,789
7.875%, 11/15/2004................... 660,000 697,125
7.50%, 2/15/2005..................... 400,000 414,000
7%, 7/15/2006........................ 2,000,000 2,006,250
6.50%, 10/15/2006.................... 2,500,000 2,423,047
--------------
39,745,576
--------------
TOTAL NOTES AND BONDS
(cost $49,547,556)................... $ 48,866,202
==============
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Principal
Short-Term Investments_17.9% Amount Value
-------------- --------------
U.S. Treasury Bills: 5.10%, 4/17/1997 $ 23,433,000 $ 23,377,750
5.02%, 5/1/1997........................ 150,000 149,358
4.97%, 5/8/1997........................ 435,000 432,686
4.95%, 5/15/1997....................... 828,000 822,743
4.96%, 5/22/1997....................(b) 1,356,000 1,346,040
--------------
TOTAL SHORT-TERM INVESTMENTS
(cost $26,131,531)................... $ 26,128,577
==============
TOTAL INVESTMENTS (cost $138,596,768)....................................... 98.2% $143,193,460
====== ==============
CASH AND RECEIVABLES (NET).................................................. 1.8% $ 2,579,006
====== ==============
NET ASSETS.................................................................. 100.0% $145,772,466
====== ==============
Notes to Statement of Investments:
(a) Non-income producing.
(b) Partially held by the custodian in a segregated account as collateral
for open futures positions.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC.,
Growth and Income Portfolio (continued)
STATEMENT OF FINANCIAL FUTURES MARCH 31, 1997 (UNAUDITED)
Market Value Unrealized
Number of Covered (Depreciation)
Financial Futures Purchased: Contracts by Contracts Expiration at 3/31/97
- ---------------------------- ------------ -------------- ------------- --------------
CAC 40....................................... 6 $ 548,672 June '97 $ (4,354)
Deutsche Akteinindex......................... 5 1,004,585 June '97 (3,453)
Financial Times.............................. 11 1,906,977 June '97 (54,454)
Hang Seng.................................... 8 643,592 April '97 (33,458)
Nikkei 300................................... 104 2,235,937 June '97 (3,096)
Russell 2000................................. 102 17,589,900 June '97 (1,066,770)
Standard & Poor's 500........................ 7 2,653,000 June '97 (141,645)
--------------
$(1,307,230)
==============
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio
STATEMENT OF INVESTMENTS MARCH 31, 1997 (UNAUDITED)
Common Stocks--57.5% Shares Value
------------- -------------
Basic Industries_2.9% duPont (E.I.) de Nemours & Co.......... 6,300 $ 667,800
Eastman Chemical....................... 2,200 118,250
Fort Howard..........................(a) 2,000 62,250
James River............................ 5,800 168,925
Mead................................... 1,000 53,000
Morton International................... 4,200 177,450
Owens-Illinois.......................(a) 3,500 86,187
Praxair................................ 3,400 152,575
Sealed Air...........................(a) 1,300 53,463
Sherwin-Williams....................... 3,200 86,400
-------------
1,626,300
-------------
Capital Spending_13.4% Adaptec..............................(a) 2,100 75,075
American Power Conversion............(a) 3,600 77,850
Applied Materials....................(a) 2,900 134,487
Arrow Electronics....................(a) 2,400 135,300
COMPAQ Computer......................(a) 4,900 375,462
Cabletron Systems....................(a) 7,000 204,750
Case................................... 1,100 55,825
Caterpillar.......................... 7,300 585,825
Cisco Systems........................(a) 8,500 409,062
Cummins Engine....................... 1,900 97,375
Eaton................................ 1,900 134,662
Gateway 2000.........................(a) 3,000 153,750
General Electric....................... 5,600 555,800
Harnischfeger Industries............... 1,700 79,050
HealthCare COMPARE...................(a) 2,400 97,500
Hewlett-Packard........................ 8,300 441,975
Ingersoll-Rand......................... 4,400 191,950
Intel.................................. 6,300 876,487
International Business Machines........ 2,400 329,700
Lexmark International Group, Cl.A....(a) 3,800 92,150
Lockheed Martin........................ 1,900 159,600
Lucent Technologies.................... 6,000 316,500
Microsoft............................(a) 10,300 944,381
Oracle...............................(a) 7,700 296,931
Reuters Holdings, A.D.S................ 1,600 93,100
Tellabs..............................(a) 7,200 260,100
Thiokol ............................... 1,200 66,300
U.S. Robotics........................(a) 1,100 60,912
USA Waste Service....................(a) 2,200 78,100
Wheelabrator Technology................ 1,200 15,750
-------------
7,395,709
-------------
Consumer Cyclical_6.7% Borders Group........................(a) 3,000 56,625
Boston Chicken.......................(a) 4,200 128,100
Brunswick.............................. 3,600 96,750
Chrysler............................... 7,200 216,000
Disney (Walt).......................... 2,100 153,300
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
------------ ------------
Consumer Cyclical (continued) Federated Department Stores.........(a) 8,000 $ 263,000
Gannett................................ 1,000 85,875
Gap.................................... 10,600 355,100
General Motors......................... 6,900 382,087
Goodyear Tire & Rubber................. 1,100 57,475
King World Productions...............(a) 2,600 94,900
MGM Grand............................(a) 2,400 87,000
Magna International, Cl. A............. 1,300 64,512
Maytag ................................ 3,100 63,937
NIKE, Cl. B............................ 2,900 179,800
New York Times, Cl. A.................. 6,100 269,162
News Corp, A.D.R....................... 2,100 37,800
Safeway..............................(a) 7,300 338,537
Sears, Roebuck & Co.................... 6,300 316,575
TJX .................................. 6,800 290,700
V.F. Corp.............................. 2,100 140,437
-------------
3,677,672
-------------
Consumer Non-Durables_.2% Tommy Hilfiger.......................(a) 2,100 109,725
-------------
Consumer Staples_7.3% Avon Products 6,400 336,000
Campbell Soup.......................... 7,600 352,450
Coca-Cola.............................. 17,700 988,987
Dole Food.............................. 600 22,650
Eastman Kodak.......................... 3,000 227,625
General Mills.......................... 3,000 186,375
Gillette .............................. 3,400 246,925
Johnson & Johnson...................... 12,800 676,800
Philip Morris Cos...................... 6,100 696,162
Pioneer Hi-Bred International.......... 1,300 81,738
Ralston-Ralston Purina Group........... 2,600 203,125
-------------
4,018,837
-------------
Energy_5.1% British Petroleum, A.D.S............... 2,300 315,675
Burlington Resources................... 3,700 158,175
Chevron................................ 8,100 563,963
Coastal................................ 4,300 206,400
Consolidated Natural Gas............... 2,400 120,900
Diamond Offshore Drilling............(a) 2,000 137,000
Exxon.................................. 5,200 560,300
Kerr-McGee............................. 1,100 68,063
NICOR.................................. 1,300 41,600
Phillips Petroleum..................... 6,300 257,513
Reading & Bates......................(a) 4,800 108,600
Unocal................................. 3,200 122,000
Williams Cos........................... 3,150 140,175
-------------
2,800,364
-------------
Health Care_5.7% Abbott Laboratories.................... 7,600 426,550
Amgen................................(a) 6,700 374,363
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
------------ --------------
Health Care (continued) Becton, Dickinson & Co 2,400 $ 108,000
Biogen ..............................(a) 400 14,950
Bristol-Myers Squibb................... 6,800 401,200
Corning................................ 2,600 115,375
Guilford Pharmaceuticals.............(a) 3,750 77,813
HEALTHSOUTH..........................(a) 12,400 237,150
Merck & Co............................. 6,700 564,475
Oxford Health Plans..................(a) 3,600 211,050
Pfizer................................. 1,900 159,838
Schering-Plough........................ 5,800 421,950
-------------
3,112,714
-------------
Interest Sensitive_8.9% AMBAC................................. 2,000 129,000
Ahmanson (H.F.) & Co................... 2,000 73,000
American National Insurance............ 900 70,425
AmSouth Bancorp........................ 3,100 149,575
Banc One............................... 5,000 198,750
BankAmerica............................ 5,200 523,900
Barnett Banks.......................... 3,200 148,800
Bear Stearns Cos....................... 7,665 201,206
CIGNA.................................. 2,700 394,538
Citicorp............................... 3,000 324,750
Comerica............................... 6,800 383,350
Conseco................................ 6,000 213,750
EXEL................................... 6,800 287,300
Federal National Mortgage Association.. 7,500 270,938
First Chicago NBD...................... 6,500 351,813
Green Tree Financial................... 4,500 151,875
MGIC Investment........................ 1,100 77,825
Norwest................................ 2,300 106,375
Republic New York...................... 1,200 105,750
SouthTrust............................. 1,800 65,025
State Street Boston.................... 1,800 124,875
Student Loan Marketing Association..... 3,000 285,750
Travelers Group........................ 5,200 248,950
-------------
4,887,520
-------------
Mining And Metals_1.4% Aluminum Co. of America 800 54,400
Phelps Dodge........................... 1,500 109,688
Potash Corp. Saskatchewan.............. 2,400 182,400
USX-Marathon Group..................... 11,900 331,713
USX-U.S. Steel......................... 3,100 82,538
-------------
760,739
-------------
Transportation_.8% CSX.................................... 4,700 218,550
Carnival, Cl. A........................ 2,400 88,800
Delta Air Lines........................ 1,800 151,425
-------------
458,775
-------------
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio (continued)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1997 (UNAUDITED)
Common Stocks (continued) Shares Value
------------- -------------
Utilities_5.1% AES....................................(a) 1,200 $ 67,200
Ameritech................................ 9,400 578,100
BellSouth................................ 9,900 418,275
Consolidated Edison...................... 6,700 201,000
DQE ..................................... 3,300 91,575
Edison International..................... 6,500 146,250
Entergy.................................. 7,500 183,750
MCI Communications....................... 4,400 156,750
Pinnacle West Capital.................... 4,700 141,588
SBC Communications....................... 9,600 505,200
Vodafone Group, A.D.R.................... 5,300 233,863
WorldCom...............................(a) 3,500 77,000
-------------
2,800,551
-------------
TOTAL COMMON STOCKS
(cost $26,982,642)..................... $31,648,906
=============
Principal
Short-Term Investments_42.4% Amount
-------------
U.S. Treasury Bills: 5.01%, 4/3/1997.......................... $ 905,000 $ 904,755
4.98%, 4/10/1997......................... 286,000 285,667
5.11%, 4/17/1997......................... 18,577,000 18,533,200
5%, 4/24/1997............................ 798,000 795,703
5.01%, 5/1/1997.......................... 380,000 378,374
4.98%, 5/8/1997.......................... 672,000 668,426
4.96%, 5/15/1997.......................(b) 1,020,000 1,013,524
4.97%, 5/22/1997......................... 273,000 270,995
5.05%, 5/29/1997.......................(b) 521,000 516,631
-------------
TOTAL SHORT-TERM INVESTMENTS
(cost $23,369,295)................... $23,367,275
=============
TOTAL INVESTMENTS (cost $50,351,937)........................................ 99.9% $55,016,181
====== ==============
CASH AND RECEIVABLES (NET).................................................. .1% $ 37,892
====== ==============
NET ASSETS.................................................................. 100.0% $55,054,073
====== ==============
Notes to Statement of Investments:
(a) Non-income producing.
(b) Partially held by the custodian in a segregated account as collateral
for open futures positions.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio (continued)
STATEMENT OF FINANCIAL FUTURES MARCH 31, 1997 (UNAUDITED)
Market Value Unrealized
Number of Covered (Depreciation)
Financial Futures Purchased: Contracts by Contracts Expiration at 3/31/97
- ---------------------------- ------------ -------------- ------------- --------------
CAC 40....................................... 6 $ 548,658 June '97 $ (5,483)
Deutsche Akteinindex......................... 5 1,004,585 June '97 (3,453)
Financial Times.............................. 9 1,560,254 June '97 (44,553)
Hang Seng.................................... 6 482,694 April'97 (25,093)
Nikkei 300................................... 105 2,257,436 June '97 (3,129)
Russell 2000................................. 54 9,312,300 June '97 (644,240)
Standard & Poor's 500........................ 18 6,822,000 June '97 (395,655)
-------------
$(1,121,606)
=============
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC.
STATEMENT OF ASSETS AND LIABILITIES MARCH 31, 1997 (UNAUDITED)
Income Growth and Income Growth
Portfolio Portfolio Portfolio
-------------- ------------------- --------------
ASSETS:
Investments in securities-See Statement of Investments
[cost_Note 5(b)]...................................... $ 26,018,030 $143,193,460 $ 55,016,181
Cash.................................................... 135,768 240,953 295,292
Receivable for investment securities sold............... 654,028 210,854 107,134
Dividends and interest receivable....................... 238,607 871,065 50,899
Receivable for shares of Common Stock subscribed........ ____ 15,500,000 ____
Prepaid expenses........................................ 48,694 66,546 35,247
-------------- ------------------- --------------
27,095,127 160,082,878 55,504,753
-------------- ------------------- --------------
LIABILITIES:
Due to The Dreyfus Corporation and affiliates........... 2,623 63,062 27,066
Due to Distributor...................................... 1,960 34 3,436
Payable for investment securities purchased............. 643,450 13,875,490 91,315
Payable for futures variation margin.................... 131,250 325,597 284,169
Accrued expenses........................................ 36,705 46,229 44,694
-------------- ------------------- --------------
815,988 14,310,412 450,680
-------------- ------------------- --------------
NET ASSETS.................................................. $ 26,279,139 $145,772,466 $ 55,054,073
============== =================== ==============
REPRESENTED BY:
Paid-in capital......................................... $ 26,116,725 $137,860,588 $ 48,533,753
Accumulated undistributed investment income_net......... 327,988 995,438 272,869
Accumulated net realized gain (loss) on investments and
foreign currency transactions......................... 562,235 3,626,978 2,704,813
Accumulated net unrealized appreciation (depreciation) on
investments and foreign currency transactions [including ($314,675),
($1,307,230) and ($1,121,606) net unrealized (depreciation) on
financial futures for the Income Portfolio, Growth and Income Portfolio
and Growth Portfolio, respectively]_Note 5(b)............... (727,809) 3,289,462 3,542,638
-------------- ------------------- --------------
NET ASSETS.................................................. $ 26,279,139 $145,772,466 $ 55,054,073
============== =================== ==============
NET ASSET VALUE PER SHARE
--------------------------------
Income Growth and Income Growth
Portfolio Portfolio Portfolio
-------------- ------------------- --------------
Retail Shares
- --------------
Net Assets.............................................. $ 17,264,314 $145,616,060 $ 39,528,562
Shares Outstanding...................................... 1,346,298 9,393,306 2,423,879
NET ASSET VALUE PER SHARE................................... $12.82 $15.50 $16.31
============== =================== ==============
Institutional Shares
- ---------------------
Net Assets.............................................. $ 9,014,825 $ 156,406 $ 15,525,511
Shares Outstanding...................................... 703,553 9,748 951,554
NET ASSET VALUE PER SHARE................................... $12.81 $16.05 $16.32
============== =================== ==============
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC.
STATEMENT OF OPERATIONS SIX MONTHS ENDED MARCH 31, 1997 (UNAUDITED)
Income Growth and Income Growth
Portfolio Portfolio Portfolio
------------ ------------------- -----------
INVESTMENT INCOME
Income:
Interest................................................ $ 755,058 $2,174,743 $ 471,509
Cash dividends (net of $2,811 and $1,429 foreign taxes withheld
at source for the Growth and Income Portfolio and the
Growth Portfolio, respectively)....................... ____ 556,790 284,290
----------- ------------------- ------------
Total Income...................................... 755,058 2,731,533 755,799
----------- ------------------- ------------
Expenses_Note 2(d):
Management fee_Note 4(a)................................ $ 72,206 $ 498,095 $ 189,348
Shareholder servicing costs_Note 4(b)................... 17,467 10,564 28,575
Registration fees....................................... 15,551 16,617 22,924
Auditing fees........................................... 4,976 13,846 12,302
Custodian fees_Note 4(b)................................ 2,512 17,923 12,045
Legal fees.............................................. 2,266 11,555 48,903
Prospectus and shareholders' reports.................... 2,220 ____ 125
Directors' fees and expenses_Note 4(c).................. 1,785 8,298 2,926
Loan commitment fees_Note 3............................. 142 765 309
Miscellaneous........................................... 4,498 11,280 7,554
---------- -------------- ------------
Total Expenses.................................... 123,623 588,943 325,011
Less_reduction in management fee due to
undertakings_Note 4(a)................................ (39,831) (88,813) (115,735)
---------- -------------- ------------
Net Expenses...................................... 83,792 500,130 209,276
---------- -------------- ------------
INVESTMENT INCOME_NET....................................... 671,266 2,231,403 546,523
---------- -------------- ------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS_Note 5:
Net realized gain (loss) on investments................... $ 17,301 $2,419,240 $1,879,172
Net realized gain (loss) on forward currency
exchange contracts...................................... ____ (2,257) (1,770)
Net realized gain (loss) on financial futures
Long Transactions....................................... 688,320 1,366,462 1,033,946
---------- -------------- ------------
Net Realized Gain (Loss).......................... 705,621 3,783,445 2,911,348
---------- -------------- ------------
Net unrealized appreciation (depreciation) on investments
[including ($331,335), ($1,482,006) and ($1,320,266) net unrealized
(depreciation) on financial futures for the Income Portfolio,
the Growth and Income Portfolio and the Growth Portfolio,
respectively]........................................... (605,546) 846,160 (608,779)
---------- -------------- ------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS............................................ 100,075 4,629,605 2,302,569
---------- -------------- ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ 771,341 $6,861,008 $2,849,092
========== ============== ============
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
March 31, 1997 Year Ended
(Unaudited) September 30, 1996*
----------------- ---------------------
OPERATIONS:
Investment income_net................................................. $ 671,266 $ 1,003,717
Net realized gain (loss) on investments............................... 705,621 752,242
Net unrealized appreciation (depreciation) on investments............. (605,546) (514,850)
------------- -------------
Net Increase (Decrease) in Net Assets Resulting from Operations..... 771,341 1,241,109
------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income_net:
Retail shares....................................................... (683,757) (373,549)
Institutional shares................................................ (402,915) (360,792)
Net realized gain on investments:
Retail shares....................................................... (452,331) (259,074)
Institutional shares................................................ (279,441) (258,568)
------------- -------------
Total Dividends..................................................... (1,818,444) (1,251,983)
------------- -------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold:
Retail shares....................................................... 4,582,154 10,745,770
Proceeds from acquisition of Dreyfus Asset Allocation Fund, Inc.,
Dreyfus Income Portfolio_Note 1................................. -- 2,175,198
Institutional shares................................................ 98 8,402,990
Dividends reinvested:
Retail shares....................................................... 1,128,662 632,623
Institutional shares................................................ 682,355 619,360
Cost of shares redeemed:
Retail shares....................................................... (657,163) (8,836,511)
Institutional shares................................................ (5) (8,400,950)
------------- -------------
Increase (Decrease) in Net Assets from Capital Stock Transactions... 5,736,101 5,338,480
------------- -------------
Total Increase (Decrease) in Net Assets......................... 4,688,998 5,327,606
NET ASSETS:
Beginning of Period................................................... 21,590,141 16,262,535
------------- -------------
End of Period......................................................... $26,279,139 $21,590,141
============= =============
Undistributed investment income_net....................................... $ 327,988 $ 744,137
------------- -------------
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
-----------------------------------------
Six Months Ended
March 31, 1997 Year Ended
(Unaudited) September 30, 1996*
------------- ---------------------
CAPITAL SHARE TRANSACTIONS:
Retail Shares
---------------
Shares sold.......................................................... 346,984 784,543
Shares issued in connection with acquisition of Dreyfus Asset Allocation
Fund, Inc.,
Dreyfus Income Portfolio_Note 1...................................... ____ 163,672
Shares issued for dividends reinvested............................... 88,731 49,308
Shares redeemed...................................................... (49,951) (638,964)
------------- -------------
Net Increase (Decrease) in Shares Outstanding...................... 385,764 358,559
============= =============
Institutional Shares
--------------------
Shares sold.......................................................... 7 607,155
Shares issued for dividends reinvested............................... 53,686 48,312
Shares redeemed...................................................... ____ (606,927)
------------- -------------
Net Increase (Decrease) in Shares Outstanding...................... 53,693 48,540
============= =============
*Effective July 15, 1996, Class R shares were redesignated as Retail shares
and Investor Class shares were redesignated as Institutional shares.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth and Income Portfolio
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Six Months Ended
March 31, 1997 Year Ended
(Unaudited) September 30, 1996*
----------------- ---------------------
OPERATIONS:
Investment income_net................................................. $ 2,231,403 $ 1,729,996
Net realized gain (loss) on investments............................... 3,783,445 2,394,043
Net unrealized appreciation (depreciation) on investments............. 846,160 1,137,447
-------------- --------------
Net Increase (Decrease) in Net Assets Resulting from Operations..... 6,861,008 5,261,486
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income_net:
Retail shares....................................................... (2,784,721) (272,975)
Institutional shares................................................ -- (240,918)
Net realized gain on investments:
Retail shares....................................................... (2,498,059) (308,722)
Institutional shares................................................ (2,967) (286,091)
-------------- --------------
Total Dividends..................................................... (5,285,747) (1,108,706)
-------------- --------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold:
Retail shares....................................................... 33,464,628 157,954,660
Institutional shares................................................ -- 9,277,898
Dividends reinvested:
Retail shares....................................................... 5,281,509 581,166
Institutional shares................................................ 2,791 527,010
Cost of shares redeemed:
Retail shares....................................................... (19,376,001) (46,831,889)
Institutional shares................................................ (12,095) (18,675,642)
-------------- --------------
Increase (Decrease) in Net Assets from Capital Stock Transactions... 19,360,832 102,833,203
-------------- --------------
Total Increase (Decrease) in Net Assets......................... 20,936,093 106,985,983
NET ASSETS:
Beginning of Period................................................... 124,836,373 17,850,390
-------------- --------------
End of Period......................................................... $145,772,466 $124,836,373
============== ==============
Undistributed investment income_net....................................... $ 995,438 $ 1,548,756
-------------- --------------
CAPITAL SHARE TRANSACTIONS_Note 6:
Retail Shares Shares Shares*
------------ -------------- --------------
Shares sold........................................................... 2,128,848 10,597,594
Shares issued for dividends reinvested................................ 345,875 42,205
Shares redeemed....................................................... (1,208,306) (3,159,207)
------------ -------------- --------------
Net Increase (Decrease) in Shares Outstanding....................... 1,266,417 7,480,592
------------ -------------- --------------
Institutional Shares
------------------
Shares sold........................................................... ____ 629,738
Shares issued for dividends reinvested................................ 177 38,272
Shares redeemed....................................................... (813) (1,259,574)
------------ -------------- --------------
Net Increase (Decrease) in Shares Outstanding....................... (636) (591,564)
------------ ============== ==============
*Effective July 15, 1996, Class R shares were redesignated as Retail shares
and Investor Class shares were redesignated as Institutional shares.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Six Months Ended
March 31, 1997 Year Ended
(Unaudited) September 30, 1996*
----------------- ---------------------
OPERATIONS:
Investment income_net................................................ $ 546,523 $ 666,900
Net realized gain (loss) on investments.............................. 2,911,348 2,955,254
Net unrealized appreciation (depreciation) on investments............ (608,779) 1,810,027
------------- -------------
Net Increase (Decrease) in Net Assets Resulting from Operations.... 2,849,092 5,432,181
------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income_net:
Retail shares...................................................... (560,123) (249,191)
Institutional shares............................................... (222,676) (226,359)
Net realized gain on investments:
Retail shares...................................................... (2,126,569) (562,690)
Institutional shares............................................... (978,027) (565,898)
------------- -------------
Total Dividends.................................................... (3,887,395) (1,604,138)
------------- -------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold:
Retail shares...................................................... 11,581,561 23,280,910
Proceeds from acquisition of Dreyfus Asset Allocation Fund, Inc.,
Dreyfus Growth Portfolio_Note 1................................ ____ 2,803,938
Institutional shares............................................... 81,011 12,713,945
Dividends reinvested:
Retail shares...................................................... 2,685,803 811,742
Institutional shares............................................... 1,200,579 792,257
Cost of shares redeemed:
Retail shares...................................................... (2,042,206) (12,912,596)
Institutional shares............................................... (15,052) (12,554,563)
------------- -------------
Increase (Decrease) in Net Assets from Capital Stock Transactions.. 13,491,696 14,935,633
------------- -------------
Total Increase (Decrease) in Net Assets........................ 12,453,393 18,763,676
NET ASSETS:
Beginning of Period.................................................. 42,600,680 23,837,004
------------- -------------
End of Period........................................................ $ 55,054,073 $ 42,600,680
============= =============
Undistributed investment income_net...................................... $ 272,869 $ 509,145
------------- -------------
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
-----------------------------------------
Six Months Ended
March 31, 1997 Year Ended
(Unaudited) September 30, 1996*
------------- ---------------------
CAPITAL SHARE TRANSACTIONS:
Retail Shares
------------
Shares sold.......................................................... 677,461 1,500,411
Shares issued in connection with acquisition of Dreyfus Asset Allocation
Fund, Inc.,
Dreyfus Growth Portfolio_Note 1.................................... -- 175,795
Shares issued for dividends reinvested............................... 168,918 57,044
Shares redeemed...................................................... (119,322) (838,288)
------------- -------------
Net Increase (Decrease) in Shares Outstanding.................. 727,057 894,962
============= =============
Institutional Shares
---------------------
Shares sold.......................................................... 4,792 828,585
Shares issued for dividends reinvested............................... 75,413 55,675
Shares redeemed...................................................... (874) (817,623)
------------- -------------
Net Increase (Decrease) in Shares Outstanding.................. 79,331 66,637
============= ==============
*Effective July 15, 1996, Class R shares were redesignated as Retail shares
and Investor Class shares were redesignated as Institutional shares.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Income Portfolio
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Portfolios' financial statements.
<TABLE>
<CAPTION>
Retail Shares Institutional Shares
------------------------------------ --------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 1997 September 30, March 31, 1997 September 30,
----------------- -------------------
PER SHARE DATA: (Unaudited) 1996(1) 1995(2) (Unaudited) 1996(1) 1995(2)
----------- ------- ------- ----------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $13.42 $13.52 $12.50 $13.39 $13.51 $12.50
----------- ------- ------- ----------- --------- --------
Investment Operations:
Investment income_net............ .34 .64 .40 .35 .73 .39
Net realized and unrealized gain (loss)
on investments................. .14 .31 .62 .12 .18 .62
----------- ------- ------- ----------- --------- --------
Total from Investment Operations. .48 .95 1.02 .47 .91 1.01
----------- ------- ------- ----------- --------- --------
Distributions:
Dividends from investment income_net (.65) (.62) -- (.62) (.60) --
Dividends from net realized gain
on investments................. (.43) (.43) -- (.43) (.43) --
----------- ------- ------- ----------- --------- --------
Total Distributions.............. (1.08) (1.05) -- (1.05) (1.03) --
----------- ------- ------- ----------- --------- --------
Net asset value, end of period... $12.82 $13.42 $13.52 $12.81 $13.39 $13.51
=========== ======= ======= =========== ========= ========
TOTAL INVESTMENT RETURN.............. 3.72%(3) 7.30% 8.24%(3) 3.57%(3) 7.07% 8.08%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .30%(3) .60% .30%(3) .43%(3) .85% .43%(3)
Ratio of net investment income
to average net assets.......... 2.83%(3) 5.75% 3.08%(3) 2.70%(3) 5.50% 2.95%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager .15%(3) .61% .26%(3) .19%(3) .61% .26%(3)
Portfolio Turnover Rate.......... 18.06%(3) 32.95% 5.66%(3) 18.06%(3) 32.95% 5.66%(3)
Net Assets, end of period (000's Omitted) $17,264 $12,889 $8,141 $9,015 $8,701 $8,122
(1) Effective July 15, 1996, Class R
shares were redesignated as Retail shares and Investor Class shares were redesignated
as Institutional shares.
(2) From March 31, 1995 (commencement of operations) to September 30, 1995.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth and Income Portfolio
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Portfolios' financial statements.
Retail Shares Institutional Shares
------------------------------------ ------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 1997 September 30, March 31, 1997 September 30,
----------------- -----------------
PER SHARE DATA: (Unaudited) 1996(1) 1995(2) (Unaudited) 1996(1) 1995(2)
------------ ------- ------- ------------ -------- -------
Net asset value, beginning of period $15.34 $14.31 $12.50 $15.43 $14.29 $12.50
------------ ------- ------- ------------ -------- -------
Investment Operations:
Investment income_net............ .26 .33 .27 .25 .90(3) .27
Net realized and unrealized gain (loss)
on investments................. .55 1.60 1.54 .68 1.12(3) 1.52
------------ ------- ------- ------------ -------- -------
Total from Investment Operations. .81 1.93 1.81 .93 2.02(3) 1.79
------------ ------- ------- ------------ -------- -------
Distributions:
Dividends from investment income_net (.34) (.42) -- -- (.40) --
Dividends from net realized gain
on investments................. (.31) (.48) -- (.31) (.48) --
------------ ------- ------- ------------ -------- -------
Total Distributions.............. (.65) (.90) -- (.31) (.88) --
------------ ------- ------- ------------ -------- -------
Net asset value, end of period... $15.50 $15.34 $14.31 $16.05 $15.43 $14.29
============ ======= ======= ============ ======== =======
TOTAL INVESTMENT RETURN.............. 5.31%(4) 14.17% 14.48%(4) 6.03%(4) 14.84% 14.32%(4)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .38%(4) .75% .38%(4) .50%(4) 1.00% .51%(4)
Ratio of net investment income
to average net assets.......... 1.68%(4) 3.60% 2.10%(4) 1.56%(4) 3.35% 1.98%(4)
Decrease reflected in above expense ratios
due to undertakings by the Manager .07%(4) .39% .33%(4) .07%(4) .39% .33%(4)
Portfolio Turnover Rate.......... 50.07%(4) 122.52% 33.55%(4) 50.07%(4) 122.52% 33.55%(4)
Average commission rate paid (5). $.0528 $.0480 -- $.0528 $.0480 --
Net Assets, end of period (000's Omitted) $145,616 $124,677 $9,248 $156 $160 $8,602
(1) Effective July 15, 1996, Class R shares were
redesignated as Retail shares and Investor Class shares were redesignated as
Institutional shares.
(2) From March 31, 1995 (commencement of operations) to September 30, 1995.
(3) Based on average shares outstanding.
(4) Not annualized.
(5) For fiscal years beginning October 1, 1995 the Portfolio is required to
disclose its average commission rate paid per share for purchases and
sales of investment securities.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS LIFETIME PORTFOLIOS, INC., Growth Portfolio
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Portfolios' financial statements.
Retail Shares Institutional Shares
------------------------------------ ------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 1997 September 30, March 31, 1997 September 30,
----------------- -----------------
PER SHARE DATA: (Unaudited) 1996(1) 1995(2) (Unaudited) 1996(1) 1995(2)
------------ -------- ------- ------------ ------- -------
Net asset value, beginning of period $16.59 $14.84 $12.50 $16.58 $14.82 $12.50
------- ------- ------- ------- ------- -------
Investment Operations:
Investment income_net............ .17 .28 .21 .16 .32 .19
Net realized and unrealized gain (loss)
on investments................. .97 2.48 2.13 .96 2.42 2.13
------- ------- ------- ------- ------- -------
Total from Investment Operations. 1.14 2.76 2.34 1.12 2.74 2.32
------- ------- ------- ------- ------- -------
Distributions:
Dividends from investment income_net (.30) (.31) -- (.26) (.28) --
Dividends from net realized gain
on investments................. (1.12) (.70) -- (1.12) (.70) --
------- ------- ------- ------- ------- -------
Total Distributions.............. (1.42) (1.01) -- (1.38) (.98) --
------- ------- ------- ------- ------- -------
Net asset value, end of period... $16.31 $16.59 $14.84 $16.32 $16.58 $14.82
======= ======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN.............. 7.06%(3) 19.73% 18.72%(3) 6.93%(3) 19.58% 18.56%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .38%(3) .75% .38%(3) .50%(3) 1.00% .51%(3)
Ratio of net investment income
to average net assets.......... 1.12%(3) 2.38% 1.51%(3) .99%(3) 2.08% 1.39%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager .23%(3) .53% .26%(3) .23%(3) .53% .26%(3)
Portfolio Turnover Rate.......... 39.47%(3) 77.83% 52.86%(3) 39.47%(3) 77.83% 52.86%(3)
Average commission rate paid (4). $.0566 $.0519 -- $.0566 $.0519 --
Net Assets, end of period (000's Omitted) $39,529 $28,143 $11,898 $15,525 $14,458 $11,939
(1) Effective July 15, 1996, Class R shares were redesignated as Retail
shares and Investor Class shares were redesignated as Institutional shares.
(2) From March 31, 1995 (commencement of operations) to September 30, 1995.
(3) Not annualized.
(4) For fiscal years beginning October 1, 1995 the Portfolio is required to
disclose its average commission rate paid per share for purchases and
sales of investment securities.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS LIFETIME PORTFOLIOS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--GENERAL:
Dreyfus LifeTime Portfolios, Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended, ("Act") as a diversified open-end
management investment company and operates as a series company currently
offering three Portfolios: the Income Portfolio, the primary investment
objective of which is to maximize current income and the secondary investment
objective of which is capital appreciation, the Growth and Income Portfolio,
the investment objective of which is to maximize total return, consisting of
capital appreciation and current income and the Growth Portfolio, the
investment objective of which is capital appreciation. The Fund accounts
separately for the assets, liabilities and operations of each series. The
Dreyfus Corporation ("Manager") serves as each Portfolio's investment
adviser. The Manager is a direct subsidiary of Mellon Bank, N.A. ("Mellon"),
which is a wholly-owned subsidiary of Mellon Bank Corporation. Mellon Equity
Associates ("Mellon Equity") serves as each Portfolio's sub-investment
adviser.
As of March 31, 1997, APT Holdings Corporation, an indirect subsidiary of
Mellon Bank Corporation, held the following shares:
Income Portfolio 1,405,972 Growth Portfolio .... 1,861,978
As of March 31, 1997, MBIC Investment Corp., an indirect subsidiary of
Mellon Bank Corporation, held the following shares;
Income Portfolio 109,980 Growth Portfolio ..... 97,223
On February 2, 1996, the Board of Directors of the Fund approved an
Agreement and Plan of Reorganization providing for the transfer of all or
substantially all of the assets and liabilities of two portfolios of Dreyfus
Asset Allocation Fund, Inc., Dreyfus Income Portfolio and Dreyfus Growth
Portfolio to the Income Portfolio and Growth Portfolio of the Fund,
respectively, in a tax free exchange for shares of Common Stock of the
respective portfolios of the Fund at net asset value and the assumption of
stated liabilities (the "Exchange"). The Exchange was approved by Dreyfus Asset
Allocation Fund, Inc. shareholders on August 19, 1996, and became effective
after the close of business on August 21, 1996, at which time the Fund issued
163,672 shares valued at $13.29 per share of the Income Portfolio's Retail Class
shares and 175,795 shares valued at $15.95 per share of the Growth Portfolio's
Retail shares to the shareholders of the Dreyfus Income Portfolio and the
Dreyfus Growth Portfolio, respectively, of Dreyfus Asset Allocation Fund, Inc.,
in exchange for 167,323 shares of the Dreyfus Asset Allocation Fund, Inc.,
Dreyfus Income Portfolio valued at $13.00 per share and 203,775 shares of the
Dreyfus Asset Allocation Fund, Inc., Dreyfus Growth Portfolio valued at $13.76
per share representing net assets of $2,175,198 and $2,803,938, respectively.
Included in the net assets of the Dreyfus Asset Allocation Fund, Inc., Dreyfus
Income Portfolio is $64 of unrealized appreciation. The combined net assets
immediately after the Exchange was $20,976,239 for the Income Portfolio of the
Fund. Included in the net assets of Dreyfus Asset Allocation Fund, Inc., Dreyfus
Growth Portfolio is $69,702 of unrealized appreciation. The combined net assets
immediately after the exchange was $39,343,700 for Dreyfus Growth Portfolio.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor
of the Fund's shares. The Fund is authorized to issue 50 million shares of
$.001 par value Common Stock in each of the following classes of shares:
Retail and Institutional. Retail shares are offered to any investor and
Institutional shares are offered only to clients of banks, securities brokers
or dealers and other financial institutions (collectively, Service Agents)
that have entered into selling agreements with the Fund's distributor. Other
differences between the two classes include the services offered to and the
expenses borne by each class.
DREYFUS LIFETIME PORTFOLIOS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
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.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES:
(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. 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.
Most debt securities (excluding short-term investments) are valued each
business day by an independent pricing service ("Service") approved by the
Board of Directors. Debt securities for which quoted bid prices are readily
available and are representative of the bid side of the market in the
judgment of the Service are valued at the mean between the quoted bid prices
(as obtained by the Service from dealers in such securities) and asked prices
(as calculated by the Service based upon its evaluation of the market for
such securities). Other debt securities are carried at fair value as
determined by the Service, based on methods which include consideration of:
yields or prices of securities of comparable quality, coupon, maturity and
type; indications as to values from dealers; and general market conditions.
(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, 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.
(d) Expenses: Expenses directly attributable to each Portfolio are
charged to that Portfolio's operations; expenses which are applicable to all
series are allocated among them on a pro rata basis.
(e) Dividends to shareholders: Dividends payable to shareholders are
recorded by each Portfolio on the ex-dividend date. Dividends from investment
income-net and dividends from net realized capital gain, with respect to each
Portfolio, are normally declared and paid annually, but each Portfolio may
make distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that a net realized
capital gain of a Portfolio can be offset by a capital loss carryover, if
any, of that Portfolio, such gain will not be distributed.
(f) 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 Internal
DREYFUS LIFETIME PORTFOLIOS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Revenue Code, and to make distributions of taxable income sufficient to
relieve it from substantially all Federal income and excise taxes. For
Federal income tax purposes, each Portfolio is treated as a single entity for
the purpose of determining such qualification.
NOTE 3--BANK LINE OF CREDIT:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility ("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. For the period ended March
31, 1997, the Fund did not borrow under the Facility.
NOTE 4--MANAGEMENT FEE, SUB-INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS
WITH AFFILIATES:
(a) Pursuant to a management agreement with the Manager, the management
fee is computed on the value of each Portfolio's average daily net assets and
is payable monthly at the following annual rates: .60 of 1% of the Income
Portfolio and .75 of 1% of the Growth and Income Portfolio and the Growth
Portfolio. The Manager has undertaken with respect to the Income Portfolio
from October 1, 1996 through March 31, 1997 to reduce the management fee paid
by, or reimburse such excess expenses of the Portfolio, to the extent that
the Portfolio's aggregate annual expenses, exclusive of the Shareholder
Services Plan fee, taxes, brokerage, interest on borrowings and extraordinary
expenses, exceed an annual rate of .60 of 1% of the value of the Portfolio's
average daily net assets. With respect to the Growth and Income Portfolio and
the Growth Portfolio, the Manager has undertaken from October 1, 1996 through
March 31, 1997 to reduce the management fee paid by, or reimburse such excess
expenses of the Portfolio, to the extent that the Portfolio's aggregate
annual expenses (exclusive of certain expenses as described above) exceed an
annual rate of .75 of 1% of the value of the Portfolio's average daily net
assets.
The reduction in management fee, pursuant to the undertakings amounted to
the following for the period ended March 31, 1997:
Income Portfolio............... $39,831 Growth Portfolio..... $115,735
Growth and Income Portfolio.... 88,813
Pursuant to a Sub-Investment Advisory Agreement between the Manager and
Mellon Equity, the Manager has agreed to pay Mellon Equity a monthly
sub-advisory fee for each Portfolio, computed at the following annual rates:
Annual Fee as a Percentage of
Total Fund Net Assets Average Daily Net Assets of each Portfolio
- --------------------- ------------------------------------------
0 to $600 million................. .35 of 1%
$600 up to $1.2 billion........... .25 of 1%
$1.2 up to $1.8 billion........... .20 of 1%
In excess of $1.8 billion......... .15 of 1%
(b) Under the Shareholder Services Plan, the Fund pays the Distributor,
at an annual rate of .25 of 1% of the value of the average daily net assets
of the Portfolio's Institutional shares 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.
DREYFUS LIFETIME PORTFOLIOS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
During the period ended March 31, 1997, the following was charged to each
Portfolio pursuant to the Shareholder Services Plan:
Income Portfolio............. $11,246 Growth Portfolio $19,502
Growth and Income Portfolio.. 201
Each Portfolio 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 each
Portfolio. During the period ended March 31, 1997, each Portfolio
compensated the following:
Income Portfolio............. $ 728 Growth Portfolio $2,900
Growth and Income Portfolio.. 3,352
The Fund compensates Mellon under a custody agreement to provide
custodial services for each Portfolio. During the period ended March 31,
1997, each Portfolio was charged by Mellon the following pursuant to the
custody agreement:
Income Portfolio............. $ 2,512 Growth Portfolio $12,045
Growth and Income Portfolio.. 17,923
(c) Each director who is not an "affiliated person" as defined in the
Act receives from the Fund an annual fee of $1,000 and an attendance fee of
$250 per meeting. The Chairman of the Board receives an additional 25% of
such compensation.
NOTE 5--SECURITIES TRANSACTIONS:
(a) The following summarizes the aggregate amount of purchases and sales
of investment securities, excluding short-term securities, during the period
ended March 31, 1997:
Purchases Sales
----------------- ---------------
Income Portfolio.................... $ 5,958,210 $ 2,866,341
Growth and Income Portfolio......... 66,248,702 53,475,826
Growth Portfolio.................... 12,594,042 12,436,419
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. 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. At March 31, 1997, there were no open
forward currency exchange contracts.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments (see the Statements of Financial Futures). Investments in
financial futures require the Fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contract at the close of
each day's trading. Typically, variation
DREYFUS LIFETIME PORTFOLIOS, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
margin payments are received or made to reflect daily unrealized gains or
losses. When the contracts are closed, the Fund recognizes a realized gain or
loss. These investments require initial margin deposits with a custodian,
which consist of cash or cash equivalents, up to approximately 10% of the
contract amount. The amount of these deposits is determined by the exchange
or Board of Trade on which the contract is traded and is subject to change.
Contracts open at March 31, 1997 and their related unrealized market
depreciation are set forth in the Statements of Financial Futures.
(b) The following summarizes accumulated net unrealized appreciation
(depreciation) on investments and financial futures for each Portfolio at
March 31, 1997:
<TABLE>
<CAPTION>
Gross Gross
Appreciation (Depreciation) Net
-------------- --------------- ------------
<S> <C> <C> <C>
Income Portfolio................. $ 12,210 $ (740,019) $ (727,809)
Growth and Income Portfolio...... 6,686,084 (3,396,622) 3,289,462
Growth Portfolio................. 5,221,792 (1,679,154) 3,542,638
</TABLE>
At March 31, 1997, the cost of investments of each Portfolio for Federal
income tax purposes was substantially the same as the cost for financial
reporting purposes. The cost of investments for each
Portfolio for financial reporting purposes as of March 31, 1997 was as
follows:
Income Portfolio.............. $ 26,431,164 Growth Portfolio $50,351,937
Growth and Income Portfolio... 138,596,768
NOTE 6--ACQUISITION OF COMMON TRUST ASSETS:
On March 31, 1997, the Fund acquired a portion of the assets of the
MCM EB Funds, a trust advised by a subsidiary of Mellon Bank, N.A. The
acquisition was accomplished by an exchange of 1,000,000 Class
R shares of the Fund's Capital Stock for cash, securities and assumption of
liabilities of the trust totaling $15,500,000 which is included in net
proceeds from shares sold on the Statement of Changes in Net Assets.
[Dreyfus lion "d" logo]
Registration Mark
DREYFUS LIFETIME PORTFOLIOS, INC.
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. DRPSA973
[Dreyfus logo]
Registration Mark
LifeTime
Portfolios, Inc.
Semi-Annual
Report
March 31, 1997
