<PAGE>
OLD WESTBURY
[LOGO] INTERNATIONAL FUND
----------------------------------------
Semiannual Report
April 30, 1996
Bessemer Trust
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
INVESTMENT ADVISOR'S REPORT
May 1996
- --------------------------------------------------------------------------------
Non-U.S. markets have performed strongly in the last six months. An
expectation of weaker U.S. growth encouraged investors to look for the faster
earnings growth offered by the Non-U.S. emerging economies. Economic statistics
showed such a weakness in Europe and Canada that lower rates seemed inevitable
in those areas. We continue to see potential for further appreciation.
PERFORMANCE
The Old Westbury International Fund (the 'Fund') rose by 12.6% for the six
months ended April 30, 1996. The Fund trailed the Morgan Stanley Capital
International: Europe, Australia and Far East Index ('EAFE') which rose 13.2%
over the same period. This was due to the lack of investment in Japan which rose
18.1%. EAFE excluding Japan rose 10.0%. The Morgan Stanley Emerging Markets Free
Index, which measures the performance of the emerging markets, rose 13.3%. Many
of the markets in which the Fund has overweighted positions performed well
including Australia, Hong Kong, Canada, Mexico and Poland but these markets were
unable to make up for Japan.
PORTFOLIO COMPOSITION
There were few significant changes in the overall asset distribution of the
Fund during the period. Some profits were taken in Latin America and other
markets which had performed strongly resulting in a higher than normal cash
position. Part of these proceeds will be invested in Germany which we believe,
following a long period of underperformance, offers value once again. The Fund
still has no exposure in Japan.
CONCLUSION
The Fund has performed well but we expect further rises in both the
developed and emerging markets. Falling interest rates should support European
markets, Canada and Australia and while the emerging markets may need a period
of stabilization they continue to offer good value.
1
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
May 1996
- --------------------------------------------------------------------------------
The outlook for growth particularly in the U.S. has been the dominant
concern in the last six months. In the first three months, markets and
particularly emerging markets soared as they anticipated further rate cuts. The
euphoria was stopped in its tracks by strong U.S. employment numbers but markets
subsequently recovered their poise as other data suggested a more moderate pace
of growth and as it became clear that there was still potential for rate cuts in
Europe. We believe the environment continues to favor international equities.
JAPAN
The Fund still has no exposure to Japan. The economy is recovering and
since the industry tends to have high fixed costs, an increase in demand will
produce a recovery in profits. Also, some companies are at last beginning to cut
costs and provide a little more information for shareholders. This could provide
opportunities. The valuation of the market as a whole does, however, continue to
look expensive and this and rising interest rates are likely to restrain the
maket in the short term.
PACIFIC BASIN
Australia, New Zealand and Hong Kong are emerging from periods of slow
growth and should benefit from faster earnings growth as their economies
recover. The rest of the Pacific Rim has suffered from high interest rates
imposed to restrain growth and moderate inflation and current account deficits.
This policy seems to have been effective and a move to lower rates should
provide further support to markets even after recent good performance.
2
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
May 1996 (Continued)
- --------------------------------------------------------------------------------
EUROPE
With growth definitely weak in Germany, rates should fall further and the
smaller markets of Southern Europe and Scandinavia have generally begun to
anticipate this which should continue to support their stock markets. German
companies have made great efforts to cut costs. This and the benefits of the
weaker currency, should permit earnings to recover there even though the economy
is likely to remain weak.
LATIN AMERICA
Confidence appears to be returning to the Mexican market which has allowed
interest rates to be progressively reduced. This and a slightly better than
expected outlook for earnings has helped to boost that market and the rest of
the region.
The trend in interest rates has benefited the dollar. We have reduced the
hedge and will progressively reduce it further into strength.
3
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
INVESTMENT OUTLOOK
May 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO
ALLOCATION AT
------------------- EAFE
GEOGRAPHICAL AREA 4/30/96 10/31/95 INDEX
- -------------------- -------- -------- --------
<S> <C> <C> <C>
Australia........... 10.4% 9.8% 2.7%
Hong Kong........... 9.6 8.6 3.3
Rest of Asia........ 17.6 21.6 4.1
UK.................. 7.3 8.6 16.2
France.............. 6.6 6.2 6.5
Spain............... 4.2 3.5 1.9
Netherlands......... 3.3 3.4 4.0
Switzerland......... 2.3 2.9 5.8
Italy............... 2.2 2.4 2.4
Germany............. -- -- 6.6
Rest of Europe...... 10.4 10.7 5.7
Latin America....... 11.6 13.3 --
South Africa........ 4.1 4.4 --
Canada.............. 2.4 2.4 --
Japan............... -- -- 40.8
Other assets and
liabilities,
net*.............. 8.0 2.2 --
------- ------- --------
100.0% 100.0% 100.0%
------- ------- --------
------- ------- --------
</TABLE>
- ------------------
* Includes cash, unrealized gains/losses on forward foreign currency contracts,
pending trades and fund share transactions, interest and dividends receivable
and accrued expenses payable.
4
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
COMMON & PREFERRED STOCKS--90.2%
ARGENTINA--3.7%
161,743 Banco De Galicia Y Buenos Aires
(Banks) $ 959,261
30,737 Capex (Utilities) 226,561
276,537 Perez Companc--Class 'B' (Energy) 1,720,283
219,700 Telefonica De Argentina ORD--Class
'B' (Services) 643,805
56,470 YPF Sociedad Anonima--Class 'D'
(Energy) 1,242,501
------------
TOTAL ARGENTINA 4,792,411
------------
AUSTRALIA--10.4%
195,300 Amcor Ltd. (Consumer Goods) 1,404,828
116,000 Brambles Industries, Ltd.
(Services) 1,593,045
354,500 CSR Ltd. (Materials) 1,280,571
147,069 Lend Lease Corporation Ltd.
(Financial Services & Property) 2,245,420
196,600 National Australia Bank Ltd.
(Banks) 1,766,950
270,077 News Corporation Ltd. (Services) 1,585,627
399,735 Western Mining Corporation
(Materials) 2,919,409
160,000 Westpac Banking Corporation (Banks) 778,186
------------
TOTAL AUSTRALIA 13,574,036
------------
BRAZIL--1.7%
41,343,000 Telebras Preferred (Services) 2,234,494
------------
CANADA--2.4%
85,500 Air Canada Class 'A' (Services) 291,948
32,512 Canadian Imperial Bank of Commerce
(Banks) 1,009,882
35,000 Canadian Pacific Ltd. (Diversified) 711,925
57,533 Laidlaw Transportation--Class 'B'
(Services) 604,143
40,780 MacMillan Bloedel Ltd. (Materials) 542,016
------------
TOTAL CANADA 3,159,914
------------
COLOMBIA--1.2%
131,409 Cementos Diamante--ORD (Materials) 680,619
</TABLE>
5
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
COLOMBIA (Continued)
99,347 Nacional De Chocolates (Consumer
Goods) $ 832,647
------------
TOTAL COLOMBIA 1,513,266
------------
EASTERN EUROPE--0.4%
60,000 First N.I.S. Regional Fund (Mutual
Fund) 540,000
------------
FINLAND--1.0%
15,200 Metra--Class 'B' (Capital Goods) 638,074
8,500 Nokia--Class 'A' (Electronics &
Electrical Equipment) 303,910
19,010 Repola Oy Sedol (Capital Goods) 368,737
------------
TOTAL FINLAND 1,310,721
------------
FRANCE--5.1%
4,424 Accor (Services) 614,397
1,256 Carrefour (Consumer Goods) 980,992
2,871 Cetelem (Financial Services &
Property) 615,849
13,277 Lafarge Coppee (Materials) 850,078
14,200 Michelin (Capital Goods) 703,408
26,888 Schneider (Capital Goods) 1,252,346
5,719 Television Francais 1 (Services) 619,466
17,925 Valeo (Consumer Goods) 994,369
------------
TOTAL FRANCE 6,630,905
------------
HONG KONG--9.6%
996,768 ASM Pacific Technology Ltd.
(Electronics & Electrical
Equipment) 979,346
296,300 Citic Pacific Ltd. (Diversified) 1,164,484
2,121,000 Gold Peak (Consumer Goods) 1,103,659
435,730 Guangdong Investment Ltd.
(Diversified) 268,980
457,998 Hong Kong Land Holdings Ltd.
[Singapore Registered] (Financial
Services & Property) 980,116
137,969 HSBC Holdings Ltd. (Banks) 2,060,117
294,000 Jardine Matheson Holdings
[Singapore Registered]
(Diversified) 2,352,000
911,000 M.C. Pakaging A.K. Ltd. (Capital
Goods) 303,266
392,149 Swire Pacific Ltd.--Class 'A'
(Diversified) 3,345,981
------------
TOTAL HONG KONG 12,557,949
------------
</TABLE>
6
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
INDIA--1.9%
47,100 Indian Rayon Industries GDR
(Materials) $ 718,275
166,167 Mahindra & Mahindra GDR (Capital
Goods) 1,723,148
------------
TOTAL INDIA 2,441,423
------------
INDONESIA--3.2%
872,000 Asahimas Flat Glass (Capital Goods) 1,076,890
84,015 Indofood Sukses Makmur (Consumer
Goods) 386,151
16,300 Indonesia Satellite Corporate ADR's
(Services) 564,388
182,000 Semen Gresik (Materials) 637,156
172,000 Tigaraksa Satria (Consumer Goods) 868,127
334,000 Trias Sentosa (Materials) 713,767
------------
TOTAL INDONESIA 4,246,479
------------
IRELAND--4.4%
168,049 Allied Irish Banks (Banks) 874,761
123,800 Bank of Ireland (Banks) 887,535
135,500 Cement Roadstone Holdings
(Materials) 1,214,266
49,000 Greencore Group PLC (Consumer
Goods) 232,918
235,700 Irish Life (Financial Services &
Property) 918,346
352,312 Smurfit (Jefferson) Group
(Materials) 938,924
606,450 Waterford Wedgwood (Consumer Goods) 680,510
------------
TOTAL IRELAND 5,747,260
------------
ITALY--2.2%
592,500 Fiat--Preferred (Consumer Goods) 1,116,879
612,400 Montedison (Materials) 372,677
401,100 Stet (Services) 1,354,684
------------
TOTAL ITALY 2,844,240
------------
KOREA--0.4%
14,000 Korea Electric Power (Energy) 591,879
------------
MALAYSIA--0.9%
400,000 Sime Darby (Diversified) 1,217,810
------------
MEXICO--3.0%
293,189 Cementos Astsk--Class 'B'
(Materials) 1,240,415
</TABLE>
7
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
MEXICO (Continued)
55,500 Empresas Ica Sociedad Controladora
(Materials) $ 763,219
125,418 Nadro--Class 'L' (Health Care) 577,160
565,173 Soriana--Class 'B' (Consumer Goods) 744,411
341,050 Telmex--Class 'L' (Services) 579,003
------------
TOTAL MEXICO 3,904,208
------------
NETHERLANDS--3.3%
13,260 ABN Amro Holdings (Banks) 686,609
40,290 IHC Caland (Consumer Goods) 1,582,906
28,000 K.L.M. NLG 20 (Services) 939,872
10,485 Wolters Kluwer (Consumer Goods) 1,146,434
------------
TOTAL NETHERLANDS 4,355,821
------------
NEW ZEALAND--2.0%
274,800 Air New Zealand--Class 'B'
(Services) 961,975
394,600 New Zealand Telecommunications
(Services) 1,673,874
------------
TOTAL NEW ZEALAND 2,635,849
------------
PERU--2.0%
227,864 Backus and Johnson--Class 'T'
(Consumer Goods) 305,484
33,711 Cementos Lima--Class 'C'
(Materials) 396,515
138,928 Minsur--Class 'T' (Materials) 1,124,541
337,459 Telefonica De Peru--Class 'B'
(Services) 754,019
------------
TOTAL PERU 2,580,559
------------
PHILIPPINES--3.8%
155,633 Bacnotan Consolidated
Industries--Class 'B' (Materials) 810,343
104,000 Jardine Davies Inc. (Diversified) 437,979
20,340 Philippine Long Distance Telephone
(Services) 1,035,689
106,733 Philippine National Bank (Banks) 1,593,650
4,587,000 Robinson Land Corporation--Class
'B'
(Financial Services & Property) 1,071,237
------------
TOTAL PHILIPPINES 4,948,898
------------
POLAND--2.0%
12,000 Bank Slaski (Banks) 898,488
</TABLE>
8
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
POLAND (Continued)
3,810 Debica (Consumer Goods) $ 90,312
134,202 Elektrim (Capital Goods) 858,392
269,820 Mostostal Export (Capital Goods) 791,856
------------
TOTAL POLAND 2,639,048
------------
SINGAPORE--2.8%
235,120 City Developments (Financial
Services & Property) 2,057,614
114,769 Oversea Chinese Bank--Class 'F'
(Banks) 1,575,981
------------
TOTAL SINGAPORE 3,633,595
------------
SOUTH AFRICA--4.1%
79,531 Free State Consolidated Gold Mines
Ltd. (Materials) 882,652
1,058,823 Iron and Steel Corporation of South
Africa (Materials) 967,017
63,500 Kloof Gold Mining Company Ltd
(Materials) 756,127
137,000 Murray & Roberts--ORD (Materials) 625,607
77,263 Sasol (Energy) 803,891
51,100 South African Pulp and Paper
Industries (Materials) 640,965
49,845 Western Areas Gold Mining
(Materials) 737,591
------------
TOTAL SOUTH AFRICA 5,413,850
------------
SPAIN--4.2%
54,492 Aumar (Services) 655,549
33,000 Enher (Utilities) 710,961
133,000 Sevillana De Electricidad 1,113,736
113,200 Telefonica De Espanol (Services) 2,016,025
53,035 Vallehermoso (Financial Services &
Property) 959,117
------------
TOTAL SPAIN 5,455,388
------------
SWEDEN--0.9%
47,700 Fastighets Tornet (Banks) 48,417
36,000 Nobel Pharma (Health Care) 573,189
</TABLE>
9
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES SECURITY (NOTE 1)
- ---------------------------------------------- ------------
<S> <C>
SWEDEN (Continued)
47,700 Sparbanken Sverige (Banks) $ 537,962
------------
TOTAL SWEDEN 1,159,568
------------
SWITZERLAND--2.3%
885 BBC Brown Boveri (Capital Goods) 1,064,277
497 Ciba Geigy--Bearer Shares (Health
Care) 572,509
3,306 Swiss Bank Corporation--Registered
(Banks) 616,553
1,090 Sulzer--Registered (Capital Goods) 735,137
------------
TOTAL SWITZERLAND 2,988,476
------------
THAILAND--2.2%
106,000 Alphatec Electronics (Electronics &
Electrical Equipment) 1,133,196
150,000 Thai Farmers Bank FS (Banks) 1,710,485
------------
TOTAL THAILAND 2,843,681
------------
TURKEY--1.8%
8,316,000 AK Bank (Banks) 983,815
5,316,685 NETAS (Consumer Goods) 1,378,112
------------
TOTAL TURKEY 2,361,927
------------
UNITED KINGDOM--7.3%
95,500 Allied Domecq (Consumer Goods) 738,253
58,950 B A T Industries ORD (Consumer
Goods) 446,380
131,410 Cable & Wireless PLC (Electronics &
Electrical Equipment) 1,033,673
232,518 Carlton Communications PLC
(Electronics & Electrical
Equipment) 1,636,278
136,280 Grand Metropolitan PLC (Consumer
Goods) 895,371
127,100 Penninsula & Oriental DFD
(Diversified) 995,940
231,342 Royal Insurance Holdings PLC
(Financial Services & Property) 1,263,709
112,767 Siebe PLC (Diversified) 1,459,687
119,158 The Boots Company PLC (Health Care) 1,140,201
------------
TOTAL UNITED KINGDOM 9,609,492
------------
TOTAL COMMON & PREFERRED STOCKS 117,933,147
------------
</TABLE>
10
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
PORTFOLIO OF INVESTMENTS
April 30, 1996 (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE
AMOUNT SECURITY (NOTE 1)
- ---------------------------------------------- ----------------
<S> <C>
CONVERTIBLE BONDS--0.3%
INDIA--0.3%
520,000 Sterlite Industries, 3 1/2%,
6/30/99 (Capital Goods) $ 434,200
----------------
TOTAL CONVERTIBLE BONDS 434,200
----------------
<CAPTION>
SHARES
- ---------
<S> <C>
WARRANTS--1.5%
FRANCE--1.5%
56,252 Christian Dior, 6/30/98*
(Consumer Goods) 1,169,650
3,909 Pinault au Printemps
Redoute, 8/2/96 (Consumer Goods) 752,312
------------
TOTAL FRANCE 1,921,962
------------
TOTAL WARRANTS 1,921,962
------------
TOTAL INVESTMENTS--92.0%
(Identified cost $104,293,530) 120,289,309
CASH AND OTHER ASSETS NET OF
LIABILITIES--8.0% 10,526,343
------------
NET ASSETS--100.0% $130,815,652
------------
------------
</TABLE>
- ------------------
* Non-income producing security
ADR: American Depository Receipt
ORD: Ordinary Shares
See Notes to Financial Statements.
11
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at market
value (Cost $104,293,530)(Note 1).. $120,289,309
Cash.................................. 8,480,587
Net unrealized appreciation on foreign
currency contracts sold (Note 5)... 1,681,108
Receivable for:
Investment securities sold...... 983,525
Fund shares sold................ 330,000
Dividends....................... 376,940
Interest........................ 33,879
Other........................... 151,819
Prepaid insurance..................... 6,875
Deferred organization expense (Note
1)................................. 46,023
------------
Total assets.................... 132,380,065
------------
LIABILITIES:
Payable for investment securities
purchased.......................... 1,417,071
Accrued expenses...................... 147,342
------------
Total liabilities............... 1,564,413
------------
NET ASSETS.............................. $130,815,652
------------
------------
Net Assets consist of:
Paid-in capital....................... $125,400,606
Distributions in excess of net
investment income.................. (1,084,179)
Accumulated net realized loss on
investments and foreign currency
transactions....................... (11,174,067)
Net unrealized appreciation on
investments and foreign currency
translations....................... 17,673,292
------------
NET ASSETS.............................. $130,815,652
------------
------------
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE ($130,815,652/12,034,942
SHARES)............................... $10.87
------
------
OFFERING PRICE PER SHARE
($10.87/.955)......................... $11.38
------
------
</TABLE>
See Notes to Financial Statements.
12
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF OPERATIONS
For the six months ended April 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
INCOME:
Dividends (net of foreign
withholding tax of
$140,095)................ $ 1,196,777
Interest.................... 141,570
-----------
Total income.......... $ 1,338,347
-----------
EXPENSES:
Investment Advisory (Note
2)....................... 448,869
Shareholder Servicing (Note
2)....................... 139,530
Custody (Note 2)............ 113,069
Administration (Note 2)..... 81,398
Audit....................... 20,000
Registration................ 15,720
Printing and Postage........ 15,644
Transfer Agent.............. 13,240
Amortization of organization
expense (Note 1)......... 9,256
Legal....................... 6,684
Directors (Note 2).......... 5,000
Distribution (Note 2)....... 2,040
Miscellaneous............... 10,539
-----------
Total expenses........ 880,989
-----------
Less fees waived by
Advisor.................. (32,976)
-----------
Net expenses.......... 848,013
-----------
NET INVESTMENT INCOME....... 490,334
-----------
NET REALIZED AND UNREALIZED
GAIN (LOSS):
NET REALIZED GAIN (LOSS) ON:
Investments.............. (6,101,434)
Foreign currency
transactions.......... 275,009 (5,826,425)
----------- -----------
NET CHANGE IN UNREALIZED
APPRECIATION ON:
Investments.............. 17,218,507
Translations of assets
and liabilities in
foreign currencies and
foreign currency
contracts............. 1,420,162 18,638,669
----------- -----------
NET REALIZED AND UNREALIZED
GAIN........................ 12,812,244
-----------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS... $13,302,578
-----------
-----------
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1996 FISCAL YEAR ENDED
(UNAUDITED) OCTOBER 31, 1995
---------------- -----------------
<S> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS:
FROM OPERATIONS:
Net investment income............ $ 490,334 $ 1,348,195
Net realized loss on investments
and foreign currency
transactions.................. (5,826,425) (4,939,089)
Net change in unrealized
appreciation (depreciation) on
investments and foreign
currency translations......... 18,638,669 (5,283,692)
------------ -------------
Net increase (decrease) in net
assets from operations........ 13,302,578 (8,874,586)
------------ -------------
DIVIDENDS TO SHAREHOLDERS:
From net investment income....... (1,459,800) (755,605)
------------ -------------
FROM CAPITAL STOCK TRANSACTIONS:
Net proceeds from sales of
capital stock................. 25,446,832 26,859,241
Reinvestment of dividends........ 1,100,982 751,802
Net cost of capital stock
redeemed...................... (11,769,426) (18,315,186)
------------ -------------
Net increase in net assets
resulting from capital stock
transactions.................. 14,778,388 9,295,857
------------ -------------
NET INCREASE (DECREASE) IN NET
ASSETS........................ 26,621,166 (334,334)
NET ASSETS:
Beginning of period.............. 104,194,486 104,528,820
------------ -------------
End of period (including
distributions in excess of
net investment income of
$1,084,179 and $113,533,
respectively.................. $130,815,652 $ 104,194,486
------------ -------------
------------ -------------
</TABLE>
See Notes to Financial Statements.
14
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected per share data for a share outstanding throughout each period
and ratios/supplemental data
<TABLE>
<CAPTION>
OCTOBER 22, 1993
FISCAL YEAR ENDED (COMMENCEMENT
SIX MONTHS ENDED OCTOBER 31, OF OPERATIONS)
APRIL 30, 1996 ------------------------------------- TO
(UNAUDITED) 1995 1994 OCTOBER 31, 1993
---------------- ----------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of
period...................... $ 9.80 $ 10.81 $ 10.14 $ 10.00
Income from investment operations:
Net investment income....... 0.06 0.04 0.07 --
Net realized and unrealized
gain (loss) on investments
and foreign currencies.... 1.15 (0.97) 0.60 0.14
------------ ------------- ------------- --------
Total from investment
operations................ 1.21 (0.93) 0.67 0.14
------------ ------------- ------------- --------
Dividends to shareholders:
From net investment
income.................... (0.14) (0.08) -- --
In excess of net investment
income.................... -- --
------------ ------------- ------------- --------
Net asset value, end of
period...................... $ 10.87 $ 9.80 $ 10.81 $ 10.14
------------ ------------- ------------- --------
------------ ------------- ------------- --------
Total return*............... 12.6% (8.6%) 6.6% 1.4%
Ratios/Supplemental data:
Net assets, end of period
(in 000's)................ $130,816 $ 104,194 $ 104,529 $ 11,957
Ratio of expenses to average
net assets before waiver
of expenses............... 1.56%** 1.60% 1.70% 2.50%**+
Ratio of expenses to average
net assets................ 1.50%** 1.50% 1.50% 1.50%**
Ratio of net investment
income (loss) to average
net assets................ 0.87%** 1.40% 0.90% (0.91%)**
Portfolio turnover rate..... 26% 32% 23% 0%
Average commissions......... $ 0.01 -- -- --
</TABLE>
- ------------------
* Total return is calculated without a sales charge assuming a purchase of
shares on the first day and a sale on the last day of the period.
** Annualized.
+ The calculation takes state expense limitations into consideration.
See Notes to Financial Statements.
15
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. Old Westbury International
Fund (the 'Portfolio') is a separate series of Old Westbury Funds, Inc. (the
'Fund'), a Maryland corporation registered under the Investment Company Act of
1940 (the 'Act'), as a diversified, open-end management investment company. The
Fund's Articles of Incorporation permit the Directors to create an unlimited
number of series, each of which is a separate class of shares. At April 30,
1996, the Portfolio was the only series of the Fund. The Fund was incorporated
under the laws of the state of Maryland on August 26, 1993 and commenced
operations on October 22, 1993.
The following is a summary of the significant accounting policies followed
by the Portfolio:
A. VALUATION OF INVESTMENTS. Securities listed on an exchange are valued,
except as indicated below, at the last sale price reflected at the close of the
regular trading session of the exchange on the business day as of which such
value is being determined. If there has been no sale on such day, the securities
are valued at the mean of the closing bid and asked prices. If no bid or asked
prices are quoted, then the security is valued by such method as the Board of
Directors shall determine in good faith to reflect its fair market value.
Portfolio securities traded on more than one national securities exchange are
valued at the last sale price on the exchange representing the principal market
for such securities.
Securities traded in the over-the-counter market, including listed
securities whose primary market is believed by Bessemer Trust Company, N.A.
('Bessemer'), the Portfolio's investment advisor (the 'Advisor'), to be
over-the-counter, are valued at the mean of the last reported bid and asked
prices from such sources as the Board of Directors deems appropriate to reflect
their fair value.
Debt instruments having 60 days or less remaining until maturity are valued
at amortized cost. Debt instruments having a greater remaining maturity will be
valued at the bid price obtained from a dealer maintaining an active market in
that security or on the basis of prices obtained from a pricing service
approved as reliable by the Board of Directors. All other investment assets,
including restricted and not readily marketable securities, are valued under
procedures established by and under the general
16
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (unaudited) (Continued)
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supervision and responsibility of the Board of Directors designed to reflect in
good faith the fair value of such securities.
B. FOREIGN CURRENCY TRANSLATION. The books and records of the Fund are
maintained in United States dollars. Foreign currency amounts are translated
into United States dollars on the following basis:
(i) value of investment securities, other assets and liabilities--at
the current rates of exchange.
(ii) purchases and sales of investment securities, income and
expenses--at the rates of exchange prevailing on the respective dates of
such translations.
Although the net assets of the Fund are presented at the foreign exchange
rates and values at the close of the period, the Fund does not isolate that
portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the value
of securities held at the end of the period. Similarly, the Fund does not
isolate the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the value of portfolio securities sold during the
period.
Foreign security and currency transactions may involve certain
considerations and risks not typically associated with those of U.S. companies
as a result of, among other factors, the level of governmental supervision and
regulation of foreign securities markets and the possibility of political and
economic instability.
C. FORWARD FOREIGN CURRENCY CONTRACTS. The Fund enters into forward foreign
currency contracts in order to hedge its exposure to changes in foreign currency
exchange rates on its foreign portfolio holdings. A forward foreign currency
contract is a commitment to purchase or sell a foreign currency at a future date
at a negotiated forward rate. Risks may arise upon entering into these contracts
from the potential inability of the counterparties to meet the terms of their
contracts.
D. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME. Security
transactions are accounted for on the trade date. Realized gains and losses on
security transactions are determined on the identified cost method. Dividend
income and other distributions from portfolio securities are recorded on the
ex-dividend date except that, if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as soon as the Portfolio is
informed of the ex-dividend date. Dividend income is recorded
17
<PAGE>
OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (unaudited) (Continued)
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net of foreign taxes withheld where recovery of such taxes is not assured.
Interest income is accrued daily.
E. DEFERRED ORGANIZATION EXPENSES. Expenses incurred by the Fund in
connection with its organization and the initial public offering of the
Portfolio's shares are being amortized on a straight-line basis over a five-year
period. The amount paid by the Portfolio on any redemption of the Portfolio's
initial shares will be reduced by the pro rata portion of any unamortized
organization expense which the number of the initial shares redeemed bears to
the total number of initial shares outstanding immediately prior to such
redemption.
F. FEDERAL TAXES. It is the Portfolio's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income or excise tax provision is required.
G. DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS. The Portfolio anticipates
paying income dividends on an annual basis. Capital gains distributions, if any,
will be made on an annual basis. The treatment for financial statement purposes
of distributions made during the year from net investment income or net realized
gains may differ from their ultimate treatment for federal income tax purposes.
These differences are caused primarily by: differences in the timing of the
recognition of certain components of income, expense, and capital gain; and the
recharacterization of foreign exchange gains or losses to either ordinary income
or realized capital gain for federal income tax purposes. Where such differences
are permanent in nature, they are reclassified in the components of net assets
based on their characterization for federal income tax purposes. Any such
reclassifications will have no effect on net assets, results of operations or
net asset value per share of the Fund.
2. TRANSACTIONS WITH AFFILIATES.
A. INVESTMENT ADVISORY FEES. Pursuant to an advisory contract, dated
October 12, 1993, the Fund has retained Bessemer to make investment decisions
for the Portfolio. The investment advisory fee paid to the Advisor is computed
daily and paid monthly in accordance with the following schedule: 0.80% of the
first $100 million of the Portfolio's average net assets, 0.75% of the second
$100 million of such assets and 0.70% of such assets exceeding $200 million.
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<PAGE>
OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (unaudited) (Continued)
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B. ADMINISTRATION FEES. The Fund has retained Signature Broker-Dealer
Services, Inc. ('Signature') to serve as administrator, distributor and
shareholder servicing agent. Signature provides administrative services
necessary for the overall administration of the Fund including, among other
responsibilities, the negotiation of contracts and fees with, and the monitoring
of performance and billings of, the independent contractors and agents of the
Fund; the preparation and filing of all documents required for compliance by the
Portfolio with applicable laws and regulations; providing equipment and
personnel necessary for maintaining the organization of the Fund; preparation of
certain documents in connection with meetings of the Board of Directors and
shareholders; the maintenance of books and records of the Portfolio; and paying
the compensation of the Fund's officers and Directors affiliated with Signature.
For providing these services, Signature receives from the Portfolio a fee
accrued daily and paid monthly at an annual rate equal to 0.15% of the average
daily net assets of the Portfolio up to $100 million; 0.10% of such assets from
$100 million to $250 million; and 0.05% of such assets over $250 million.
C. DISTRIBUTION AND SERVICE PLAN AND DISTRIBUTION REIMBURSEMENT FEES. The
Directors have adopted a distribution and service plan (the 'Plan') for the
Portfolio pursuant to Rule 12b-1 of the Act, and pursuant to the Plan, the
Portfolio has entered into a distribution agreement and a shareholder servicing
agreement with Signature and a shareholder servicing agreement with Bessemer.
Under its shareholder servicing agreement, Signature is permitted to receive
payments from the Portfolio to permit it to make payments to broker-dealers for
providing shareholder services. Under its shareholder servicing agreement,
Bessemer is permitted (i) to receive a payment from the Portfolio attributable
to Bessemer's clients (and its affiliates) for providing shareholder services to
such clients and (ii) to receive payments to permit it to make payments to other
financial institutions as shareholder servicing agents. The total of shareholder
servicing fees in the aggregate payable to Signature and Bessemer will not
exceed 0.25% per annum of the Portfolio's average daily net assets.
The distribution agreement with Signature provides for reimbursement to
Signature by the Portfolio for its distribution, promotional and advertising
costs incurred in connection with the distribution of the Portfolio's shares in
an amount not to exceed 0.10% per annum of the Portfolio's average daily net
assets.
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<PAGE>
OLD WESTBURY INTERNATIONAL FUND
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (unaudited) (Continued)
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In addition, the Portfolio will pay for certain other expenses under the
Plan. These expenses shall not exceed an amount equal to 0.05% per annum of the
Portfolio's average daily net assets.
D. DIRECTORS' FEES. Each Director who is not an 'interested person' (as
defined in the Act) of the Fund receives a $5,000 annual retainer and is
reimbursed for out-of-pocket expenses incurred in connection with committee or
board meetings. Effective June 1, 1996 Trustees will receive an additional $500
meeting fee.
E. CUSTODY FEES. The Fund has retained Bessemer to serve as the Portfolio's
custodian. Bessemer is responsible for maintaining the books and records of the
Portfolio's securities and cash. For providing these services, Bessemer receives
from the Portfolio a fee accrued daily and paid monthly at an annual rate equal
to 0.20% of the average daily net assets of the Portfolio.
3. CAPITAL STOCK. The Fund has authorized a total of 20 billion shares of common
stock (par value $0.001 per share) and is permitted to issue 4 billion of the
authorized shares in the Portfolio. Transactions in shares of capital stock were
as follows:
<TABLE>
<CAPTION>
FISCAL YEAR
SIX MONTHS ENDED ENDED OCTOBER
APRIL 30, 1996 31, 1995
---------------- ----------------
<S> <C> <C>
Common stock sold... 2,454,830 2,725,287
Reinvestment of
dividends......... 108,364 78,231
Common stock
redeemed.......... (1,163,271) (1,842,187)
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Net increase........ 1,399,923 961,331
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</TABLE>
4. PURCHASES AND SALES OF SECURITIES. For the six months ended April 30, 1996,
purchases and sales of investment securities other than short-term investments
aggregated $28,849,133 and $27,650,879, respectively.
5. FORWARD FOREIGN CURRENCY CONTRACTS. Forward foreign currency contracts open
at April 30, 1996:
<TABLE>
<CAPTION>
DELIVER UNREALIZED
CONTRACTS FORWARD SALE DATE VALUE PROCEEDS APPRECIATION
- --------------- ------------ ------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
13,338,177 ECU 6/28/96 $16,391,286 $17,617,064 $ 1,225,778
2,128,358 ECU 6/28/96 2,615,538 2,809,432 193,894
3,792,570 ECU 6/28/96 4,660,689 4,900,000 239,311
2,665,705 ECU 1/24/97 3,303,875 3,326,000 22,125
----------- ----------- ------------
$26,971,388 $28,652,496 $ 1,681,108
----------- ----------- ------------
----------- ----------- ------------
</TABLE>
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ECU: European Currency Units
20
<PAGE>
INVESTMENT ADVISOR:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, New York 10111
(212) 708-9100
DISTRIBUTOR, ADMINISTRATOR, AND
SHAREHOLDER SERVICING AGENT:
Signature Broker-Dealer Services, Inc.
6 St. James Avenue
Boston, Massachusetts 02116
(617) 423-0800
SHAREHOLDER SERVICING AGENT:
Bessemer Trust Company, N.A.
630 Fifth Avenue
New York, New York 10111
(212) 708-9100
