<PAGE>
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DELAFIELD 600 FIFTH AVENUE, NEW YORK, N.Y. 10020
FUND, INC. (212) 830-5200
================================================================================
Dear Shareholder:
We are pleased to present the semi-annual report of Delafield Fund, Inc. for the
period January 1, 2000 through June 30, 2000.
The Delafield Fund's net asset value per share on June 30, 2000 was $13.88 as
compared to $14.07 at December 31, 1999. The Fund had net assets of $96,864,112
and 961 active shareholders. The Fund registered a decrease of 1.4% during the
first-half year. The Fund held 58 companies, with the top ten holdings
accounting for 35% of total net assets overall. Equity investments comprised 94%
of the $96.9 million portfolio on June 30, 2000.
We thank you for your support and look forward to serving your needs.
Sincerely,
\s\J. Dennis Delafield \s\Vincent Sellecchia
J. Dennis Delafield Vincent Sellecchia
Chairman President
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
STATEMENT OF NET ASSETS
JUNE 30, 2000
(UNAUDITED)
================================================================================
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------ ------
Common Stocks (94.19%)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Aerospace (1.83%)
GenCorp Inc. 100,000 $ 800,000
Raytheon Co. - Class A 50,000 971,875
--------------
1,771,875
--------------
Apparel (1.21%)
Jones Apparel Group, Inc.* 50,000 1,175,000
--------------
Building (2.19%)
Elcor Corporation 30,000 690,000
Walter Industries, Inc. 125,000 1,429,688
--------------
2,119,688
--------------
Business Services (1.71%)
Modis Professional Services, Inc.* 187,000 1,659,625
--------------
Chemicals (10.19%)
Cabot Corporation 107,000 2,915,750
Calgon Carbon Corporation 95,000 736,250
Crompton Corporation 110,000 1,347,500
Engelhard Corporation 140,000 2,388,750
Geon Company (The) 20,000 370,000
Hanna (M.A.) Company 110,000 990,000
International Specialty Products Inc.* 60,000 341,250
OMNOVA Solutions Inc. 125,000 781,250
--------------
9,870,750
--------------
Computer & Computer Services (0.30%)
Unisys Corporation 20,000 291,250
--------------
Consumer Products & Services (6.92%)
Bush Industries, Inc. 250,000 4,000,000
Huffy Corporation* 415,000 1,789,687
Water Pik Technologies, Inc.* 146,000 912,500
--------------
6,702,187
--------------
Cosmetics and Toiletries (0.95%)
Alberto-Culver Company (Class A) 35,000 918,750
--------------
Energy (4.77%)
Forest Oil Corporation* 70,000 1,115,625
Ogden Corporation* 390,000 3,510,000
--------------
4,625,625
--------------
</TABLE>
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
================================================================================
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------ ------
Common Stocks (Continued)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Financial Products & Services (8.68%)
Banta Corporation 50,000 $ 946,875
Bell & Howell Company* 100,000 2,425,000
Deluxe Corporation 125,000 2,945,313
Harland (John H.) Company 70,000 1,045,625
Moore Corporation Limited 400,000 1,050,000
--------------
8,412,813
--------------
Food Processing (2.38%)
International Multifoods Corporation 70,000 1,211,875
Universal Foods Corporation 59,000 1,091,500
--------------
2,303,375
--------------
Home Furnishings (1.09%)
Furniture Brands International* 70,000 1,058,750
--------------
Industrial Distribution (7.09%)
JLK Direct Distribution Inc.* 204,100 1,046,013
MSC Industrial Direct Company, Inc.* 278,000 5,820,625
--------------
6,866,638
--------------
Industrial Products (17.23%)
AMETEK, Inc. 115,000 2,012,500
Atchison Casting Corporation* 55,000 316,250
Carlisle Companies Incorporated 5,000 225,000
Flowserve Corporation* 150,000 2,259,375
Gerber Scientific, Inc. 6,500 74,750
Harsco Corporation 44,000 1,122,000
Kennametal Inc. 145,000 3,108,437
Minerals Technologies Inc. 22,500 1,035,000
Thermo Electron Corporation* 22,000 463,375
UNOVA, Inc.* 215,000 1,572,187
Wabtec Corporation 150,000 1,556,250
York International Corporation 116,700 2,946,675
--------------
16,691,799
--------------
Information Processing (2.36%)
Reynolds and Reynolds Company 125,000 2,281,250
--------------
</TABLE>
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
STATEMENT OF NET ASSETS (CONTINUED)
JUNE 30, 2000
(UNAUDITED)
================================================================================
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------ ------
Common Stocks (Continued)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Insurance (Property/Casualty) (0.39%)
Highlands Insurance Group, Inc.* 40,000 $ 375,000
--------------
Insurance (Reinsurance) (2.86%)
LaSalle Re Holdings Limited* 195,200 2,769,400
--------------
Metals/Mining (3.31%)
Allegheny Technologies Incorporated 56,000 1,008,000
Commercial Metals Company 80,000 2,200,000
--------------
3,208,000
--------------
Real Estate (5.06%)
Fairfield Communities, Inc.* 232,000 1,827,000
Kimco Realty Corporation 75,000 3,075,000
--------------
4,902,000
--------------
Retail (4.27%)
Claire's Stores, Inc. 76,000 1,463,000
Sunglass Hut International, Inc.* 325,000 2,671,094
--------------
4,134,094
--------------
Textile/Apparel (5.24%)
Burlington Industries, Inc.* 800,000 1,350,000
Delta Woodside Industries, Inc.* 800,000 1,750,000
Shaw Industries, Inc. 158,000 1,975,000
--------------
5,075,000
--------------
Miscellaneous (4.16%)
Ball Corporation 51,000 1,641,562
Federal Signal Corporation 25,000 412,500
XTRA Corporation* 50,000 1,971,875
--------------
4,025,937
--------------
Total Common Stocks (Cost $95,379,220) 91,238,806
--------------
</TABLE>
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
================================================================================
<TABLE>
<CAPTION>
Value
Shares (Note 1)
------ ------
Short-Term Investments (7.53%)
Repurchase Agreements (7.53%)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Morgan (J.P.) Securities Inc., 6.450%, due 07/03/2000
(Collateralized by $7,474,000, Federal Home Loan Mortgage Corporation
Discounted Note, 0.000%, due 07/25/00) $7,294,000 $ 7,294,000
---------------
Total Short-Term Investments (Cost $7,294,000) 7,294,000
---------------
Total Investments (101.72%) (Cost $102,673,220+) 98,532,806
Liabilities In Excess of Cash and Other Assets (-1.72%) ( 1,668,694)
---------------
Net Assets (100.00%) $ 96,864,112
===============
Net asset value, offering and redemption price per share
Institutional Class ($96,858,654 applicable to 6,977,125 shares outstanding) (Note 3) $ 13.88
===============
Retail Class ($5,458 applicable to 393 shares outstanding) (Note 3) $ 13.87
===============
</TABLE>
* Non-income producing.
+ Aggregate cost for federal income tax purposes is $102,727,889. Aggregate
unrealized appreciation and depreciation, based on cost for Federal income
tax purposes, are $7,947,228 and $12,142,311, respectively.
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2000
(UNAUDITED)
================================================================================
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C>
Income:
Interest........................................................................ $ 98,846
Dividends....................................................................... 478,891
---------------
Total income............................................................... 577,737
---------------
Expenses: (Note 2)
Investment management fee....................................................... 313,637
Administration fee.............................................................. 82,330
Shareholder servicing fee (Retail Class)........................................ 4
Custodian expenses.............................................................. 8,121
Shareholder servicing and related shareholder expenses.......................... 36,039
Legal, compliance and filing fees............................................... 28,702
Audit and accounting............................................................ 32,862
Directors' fees and expenses.................................................... 3,752
---------------
Total expenses............................................................... 505,447
Less:
Expenses paid indirectly..................................................... ( 681)
---------------
Net expenses................................................................. 504,766
---------------
Net investment income........................................................ 72,971
---------------
<CAPTION>
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
<S> <C>
Net realized gain (loss) on investments............................................ ( 382,439)
Net change in unrealized appreciation (depreciation) of investments................ ( 2,536,646)
---------------
Net gain (loss) on investments............................................. ( 2,919,085)
---------------
Increase (decrease) in net assets from operations.................................. $( 2,846,114)
===============
</TABLE>
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
Six Months
Ended Year
June 30, 2000 Ended
(Unaudited) December 31, 1999
----------- -----------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
<S> <C> <C>
Net investment income..................................................... $ 72,971 $ 515,188
Net realized gain/(loss) on investments................................... ( 382,439) ( 33,813)
Net change in unrealized appreciation (depreciation) ..................... ( 2,536,646) 5,651,088
--------------- --------------
Increase (decrease) in net assets from operations........................ ( 2,846,114) 6,132,463
Distributions from:
Net investment income..................................................... -- ( 515,840)
Return of capital......................................................... -- --
Capital share transactions (Note 3)
Institutional Class................................................. 14,176,972 ( 23,818,361)
Retail Class........................................................ 4,899 --
--------------- --------------
Total increase (decrease).............................................. 11,335,757 ( 18,201,738)
Net Assets:
Beginning of period....................................................... 85,528,355 103,730,093
--------------- --------------
End of period (including undistributed net investment income
of $72,971 and $0, respectively)........................................ $ 96,864,112 $ 85,528,355
=============== ==============
</TABLE>
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
================================================================================
1. Summary of Accounting Policies
Delafield Fund, Inc. is a no-load, diversified, open-end management investment
company registered under the Investment Company Act of 1940. The investment
objectives of the Fund are to seek long-term preservation of capital and growth
of capital by investing primarily in equity securities of domestic companies.
Effective August 18, 1998, the Fund authorized three classes of stock:
Administrative Class, Institutional Class, and Retail Class. Original shares of
the Fund were automatically converted to Institutional Class shares of the Fund.
The Administrative Class shares of the Fund are available to qualified
retirement plan clients of financial intermediaries and are subject to a service
fee pursuant to the Fund's 12b-1 Plan. The Institutional Class shares of the
Fund are available to corporate, institutional and individual investors and are
not subject to a service fee. The Retail Class shares of the Fund are subject to
a service fee pursuant to the Fund's Rule 12b-1 Distribution and Service Plan
and are sold through financial intermediaries who provide servicing to Retail
Class shareholders. As of June 30, 2000 both the Institutional Class and the
Retail Class of the Fund were active. Its financial statements are prepared in
accordance with generally accepted accounting principles for investment
companies as follows:
a) Valuation of Securities -
Securities traded on a national securities exchange or admitted to trading
on the National Association of Securities Dealers Inc. Automated Quotations
National List are valued at the last reported sales price on the last
business day of the fiscal period. Common stocks for which no sale was
reported on that date and over-the-counter securities, are valued at the
mean between the last reported bid and asked prices. United States
Government obligations and other debt instruments having sixty days or less
remaining until maturity are stated at amortized cost. Debt instruments
having a remaining maturity of more than sixty days are valued at the
highest 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 in such manner as the Board of Directors in good faith deems
appropriate to reflect their fair market value.
b) Federal Income Taxes -
It is the Fund'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. Therefore, no provision for
federal income tax is required.
c) Use of Estimates -
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to
make estimates and assumptions that effect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of increases and
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates.
d) General -
Securities transactions are recorded on the trade date basis. Interest
income is accrued as earned and dividend income is recorded on the
ex-dividend date. Realized gains and losses from securities transactions
are recorded on the identified cost basis. Dividends and capital gain
distributions to shareholders, which are determined in accordance with
income tax regulations, are recorded on the ex-dividend date. It is the
Fund's policy to take possession of securities as collateral under
repurchase agreements and to determine on a daily basis that the value of
such securities plus accrued interest are sufficient to cover the value of
the repurchase agreements.
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
================================================================================
2. Investment Management Fees and Other Transactions with Affiliates
Under the Investment Management Contract, the Fund pays an investment management
fee to Reich & Tang Asset Management, L.P. (the "Manager") equal to .80% of the
Fund's average daily net assets.
Pursuant to an Administrative Services Agreement, the Fund pays to the Manager
an annual fee of .21% of the Fund's average daily net assets.
Pursuant to a Distribution and Service Plan adopted under Securities and
Exchange Commission Rule 12b-1, the Fund and Reich & Tang, Inc. (The
Distributor) have entered into a Distribution Agreement and a Shareholder
Servicing Agreement, only with respect to the Administrative Class and Retail
Class shares of the Fund. For its services under the Shareholder Servicing
Agreement, the Distributor receives from the Fund with respect only to the
Administrative Class and Retail Class shares, a fee equal to .25% of the Fund's
average daily net assets. There is no shareholder servicing fee for
Institutional Class shares of the Fund. There were no additional expenses borne
by the Fund pursuant to the Distribution Agreement.
Brokerage commissions paid during the period to the Distributor amounted to
$92,597.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are fees of $19,456 paid to Reich & Tang
Services, Inc., an affiliate of the Manager as servicing agent for the Fund.
Included in the Statement of Operations under the caption "Shareholder servicing
and related shareholder expenses" are expense offsets of $681.
3. Capital Stock
At June 30, 2000, 20,000,000,000 shares of $.001 par value stock were authorized
and capital paid in amounted to $101,359,104. Transactions in capital stock were
as follows:
On June 16, 2000, the Fund acquired the net assets of Reich & Tang Equity Fund,
Inc. ("RTEF") pursuant to a plan of reorganization approved by RTEF
shareholders. The merger was accomplished by a tax-free exchange of 1,919,954
shares of the Fund (valued at $14.43 per share) for the net assets of RTEF which
aggregated $27,704,933, including $1,726,234 of unrealized appreciation. The
combined net assets of the Fund immediately after the merger were $106,648,632.
<TABLE>
<CAPTION>
Six Months Year
Institutional Class Ended Ended
------------------- June 30, 2000 December 31, 1999
----------------------------- ---------------------------
Shares Amount Shares Amount
------------ ----------- ----------- ------------
<S> <C> <C> <C> <C>
Sold................................ 632,310 $ 8,821,518 1,258,219 $ 17,488,983
Shares issued on merger............. 1,919,954 27,704,933 -- --
Issued on reinvestment of dividends. -- -- 36,428 504,888
Redeemed............................ ( 1,651,982) (22,349,479) ( 3,161,363) (41,812,232)
----------- ---------- ---------- ----------
Net increase (decrease)............. 900,282 $14,176,972 ( 1,866,716) $(23,818,361)
=========== ========== ========== ==========
<CAPTION>
March 13, 2000
Retail Class (Commencement of Sales)
------------ June 30, 2000
-----------------------------
Shares Amount
------------ -----------
<S> <C> <C>
Sold................................ 393 $ 4,907
Issued on reinvestment of dividends. -- --
Redeemed............................ -- ( 8)
----------- ----------
Net increase (decrease)............. 393 $ 4,899
=========== ==========
</TABLE>
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
DELAFIELD FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
================================================================================
4. Investment Transactions
Purchases and sales of investment securities, other than U.S. Government direct
and agency obligations and short-term investments, totaled $52,536,532 and
$44,786,193, respectively. Accumulated undistributed realized losses at June 30,
2000 amounted to $427,549. Of this amount $45,110 represents tax basis capital
losses which may be carried forward to offset future capital gains. Such losses
expire December 1, 2006 and 2007.
5. Financial Highlights
<TABLE>
<CAPTION>
Year
Six Months Ended Period from Year
INSTITUTIONAL CLASS Ended December 31, October 1, 1995 to Ended
------------------- June 30, 2000 -------------------------------------------- December 31, September 30,
(Unaudited) 1999 1998 1997 1996 1995 1995
--------- -------- -------- -------- -------- --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
(for a share outstanding
throughout the period)
Net asset value, beginning of period..... $ 14.07 $ 13.06 $ 14.88 $ 13.49 $ 12.26 $ 11.95 $ 10.82
-------- -------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income................ 0.01 0.09 0.12 0.21 0.16 0.05 0.13
Net realized and unrealized
gains (losses) on investments.......... ( 0.20 ) 1.01 ( 1.82 ) 2.42 3.07 0.50 1.99
------- -------- ------- -------- -------- -------- --------
Total from investment operations......... 13.88 1.10 ( 1.70 ) 2.63 3.23 0.55 2.12
-------- -------- ------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income... -- ( 0.09 ) ( 0.12 ) ( 0.21 ) ( 0.16 ) ( 0.05 ) ( 0.13 )
Distributions from net realized gains
on investments....................... -- -- -- ( 1.03 ) ( 1.84 ) ( 0.18 ) ( 0.86 )
In excess of net realized gain......... -- -- -- -- -- ( 0.01 ) --
-------- -------- -------- -------- -------- ------- --------
Total distributions...................... -- -- ( 0.12 ) ( 1.24 ) ( 2.00 ) ( 0.24 ) ( 0.99 )
-------- -------- ------- ------- ------- ------- -------
Net asset value, end of period........... $ 13.88 $ 14.07 $ 13.06 $ 14.88 $ 13.49 $ 12.26 $ 11.95
======== ======== ======= ======== ======== ======== ========
Total Return............................. ( 1.35%)(a) 8.40% ( 11.47%) 19.66% 26.35% 4.62%(a) 20.05%
Ratios/Supplemental Data
Net assets, end of period (000).......... $ 96,859 $ 85,528 $ 103,730 $ 146,624 $ 61,279 $ 45,730 $ 42,316
Ratios to average net assets:
Expenses, net of fees waived+.......... 1.29%* 1.25% 1.24% 1.29% 1.29% 1.67%* 1.65%
Net investment income.................. 0.19%* 0.56% 0.83% 1.64% 1.18% 1.57%* 1.35%
Management, administration and
shareholder servicing fees waived..... 0.00%* 0.00% 0.16% 0.20% 0.20% 0.20%* 0.71%
Expenses paid indirectly............... 0.00%* 0.00% 0.00% 0.00% 0.01% 0.07%* 0.00%
Portfolio turnover rate.................. 58.40% 105.37% 81.56% 55.43% 75.54% 20.49% 70.36%
* Annualized
+ Includes expenses paid indirectly
(a) Not annualized
</TABLE>
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
================================================================================
5. Financial Highlights (Continued)
<TABLE>
<CAPTION>
March 13, 2000
RETAIL CLASS (Commencement of Sales) to
------------ June 30, 2000
-------------
<S> <C>
Per Share Operating Performance:
(for a share outstanding throughout the period)
Net asset value, beginning of period........... $ 12.69
-------------
Income from investment operations:
Net investment income...................... --
Net realized and unrealized
gains (losses) on investments................ 1.18
-------------
Total from investment operations............... 1.18
-------------
Less distributions:
Dividends from net investment income......... --
Distributions from net realized gains
on investments............................. --
In excess of net realized gain................. --
-------------
Total distributions............................ --
-------------
Net asset value, end of period................. $ 13.87
==============
Total Return................................... 9.30%(a)
Ratios/Supplemental Data
Net assets, end of period (000)................ $ 5
Ratios to average net assets:
Expenses, net of fees waived................. 1.56%*
Net investment income........................ 0.16%*
Management, administration and
shareholder servicing fees waived........... 0.00%*
Expenses paid indirectly..................... 0.00%*
Portfolio turnover rate........................ 58.40%
</TABLE>
* Annualized
+ Includes expenses paid indirectly
(a) Not annualized
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
-----------------------------------------------------
This report is submitted for the general
information of the shareholders of the Fund. It is
not authorized for distribution to prospective
investors in the Fund unless preceded or
accompanied by an effective prospectus, which
includes information regarding the Fund's
objectives and policies, experience of its
management, marketability of shares, and other
information.
-----------------------------------------------------
Delafield Fund, Inc.
600 Fifth Avenue
New York, New York 10020
Manager
Reich & Tang Asset Management, L.P.
600 Fifth Avenue
New York, New York 10020
Custodian
State Street Kansas City
801 Pennsylvania
Kansas City, Missouri 64105
Transfer Agent &
Dividend Disbursing Agent
Reich & Tang Services L.P.
600 Fifth Avenue
New York, New York 10020
DEL6/00S
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
(GRAPHIC OMITTED) DELAFIELD
--------FUND
Semi-Annual Report
June 30, 2000
(Unaudited)
--------------------------------------------------------------------------------
<PAGE>
