<PAGE>
Dreyfus
Small Company
Value Fund
Semi-Annual
Report
April 30, 1998
<PAGE>
Dreyfus Small Company Value Fund
- --------------------------------------------------------------------------------
Letter to Shareholders
Dear Shareholder:
It is my pleasure to introduce Peter I. Higgins, who became the primary
portfolio manager of Dreyfus Small Company Value Fund in November of 1997.
A 12-year veteran of the financial services industry, Mr. Higgins has been
the primary portfolio manager for Dreyfus Midcap Value Fund since its inception
in September, 1995. He joined Dreyfus in May, 1996 pursuant to a dual employee
agreement between Dreyfus and The Boston Company Asset Management, LLC, a
Dreyfus affiliate. Mr. Higgins has been with The Boston Company since 1988,
where he serves as the lead portfolio manager for the Small Cap Value and Mid
Cap Value Products. He graduated summa cum laude from the University of
Pennsylvania with both a B.A. in Economics and a B.S. in Economics from the
Wharton School of Business. In addition, he earned an M.B.A. in management, with
distinction, from the Wharton School of Business. Mr. Higgins is a Chartered
Financial Analyst.
Please note that the objective and policies of Dreyfus Small Company Value
Fund have not changed. The Fund will continue to seek investment results that
exceed the total return of the Russell 2000 Index by investing in the stocks of
value companies with market caps ranging from $90 million to $1.3 billion.
We have great confidence in Mr. Higgins' ability to manage assets on your
behalf.
Sincerely,
/s/ Stephen E. Canter
Stephen E. Canter
Chief Investment Officer
The Dreyfus Corporation
May 18, 1998
New York, N.Y.
<PAGE>
Dear Shareholder:
We are pleased to provide you with this report for Dreyfus Small Company Value
Fund for the six-month period ended April 30, 1998. Over this period, your Fund
produced a total return of 9.71%* as compared to the Fund's benchmark index, the
Russell 2000 Index, which had a total return of 11.88%.**
Economic Review
Although real Gross Domestic Product (GDP) sustained a growth trend
approaching 4% into the first quarter, incoming evidence suggests a shift to
somewhat slower economic growth in coming months. Aggregate profit margins
already have begun to narrow in some sectors. The conflicting pressures of a
softening economy and a still tightening labor market have kept the Federal
Reserve Board in neutral, although a bias favoring higher interest rates was
resumed recently. Market interest rates have likewise stayed within a narrow
range in recent months.
While manufacturing has turned appreciably sluggish since year-end, this was
overshadowed in the first quarter by a strong rebound in domestic demand. The
industrial sector has been slowed by the strong dollar and by weak exports.
However, with Asian economies still in turmoil, competition from Asian-made
imports has emerged only gradually. The first-quarter rebound in domestic demand
was fueled primarily by strong housing market conditions and rising real
household incomes, but additionally by several short-lived influences.
Rising real wages that have been such a boon to consumers in recent months may
also be taking a toll on corporate profit margins. The first sign of profit
pressure was seen last year as the dollar strengthened. This year, profit
margins have eroded further due to weak exports and falling prices in some
sectors. Accelerating wage growth that is apparent alongside limited pricing
power may also prove a harbinger of profit margin erosion. Hence, a shift to
slower economic growth that coexists with rising wage pressures creates a
further risk to overall profit growth.
The above pressures have kept Fed policy unchanged until now. However, we
believe that policymakers are more concerned about wage growth than economic
strains, as evidenced by a recent shift towards a tightening bias. Although
long-term bond yields were below year-ago levels at the end of April,
substantially lower yields have proven difficult to attain in the absence of
lower short-term rates. This too could restrain the economic growth rate.
Market Overview
Equity prices during the six months ended April 30, 1998 continued to display
considerable volatility, most of the time on the upside. Last November, the
markets were still trying to recover from the financial crisis in Asia. As the
months went by, however, the U.S. equity markets rebounded from that severe
blow.
Early in the New Year, there were temporary setbacks due to worries about
inflation and concern about the corporate profit outlook. By midwinter, however,
the markets resumed their upward surge, which continued almost unbroken until
interest rate jitters struck again in late April. This time the cause was a
press report that the Fed was going to tilt its policy toward tightening credit.
As it turned out, even that scare was short-lived and, as the month of May
began, stock prices set new records once again, especially the stocks of the
large-capitalized corporations.
Despite the impressive gains in the broad market averages, it was not a market
that would allow investors simply to sit back and relax. Some commentators had
begun to refer to it as the "bubble market," a market that could inflate to
record heights one week, yet the next week could be deflated just as quickly by
unexpected national, international and corporate news.
<PAGE>
Now that most first-quarter corporate profits have been reported, it is
apparent that the quarter saw a slowdown in total profits. While some analysts
believe there could be an increase in the growth of earnings in the second
quarter and beyond, many skeptics believe such possible increases to be
overoptimistic. The skeptics have cited several factors:
o possible delayed reaction to the collapse of Asian markets;
o the ever-present possibility that the Fed could still raise interest rates;
o the approaching shadow of the midterm elections next fall, with all the
political acrimony they could bring.
There was also the risk that Fed Chairman Greenspan might once again warn
against excessive enthusiasm in the equity markets, as he did in late 1996 when
he spoke of "irrational exuberance."
In this atmosphere, wary investors were as quick to sell as to buy, depending
on the ebb and flow of economic and political news. Volatility, it appeared,
was a condition the markets would need to live with for some time to come, in
rising as well as in falling markets.
Portfolio Focus
The Fund's performance was adversely impacted by our underweight in utilities
and financials and our premature rotation to an overweight position in
technology. We boosted our technology weighting from close to a market-weight
position to a significant overweight early in the fourth quarter of 1997,
following steep declines in many high quality technology companies.
Unfortunately, the problems in Asia have continued to accelerate, and technology
companies have a higher proportion of Asian exposure, leading to continued
pressures on the group. Finance and utilities, on the other hand, were viewed as
safe havens with modest foreign exposure and helped by a favorable interest rate
environment. We believe that many technology companies have been oversold by the
market.
The Fund's Long-Term Strategy
Our investment philosophy for the Fund focuses on identifying cheap stocks
with positive short-term business trends and solid long-term fundamentals. We
examine many measures to identify cheap stocks; Price/Earnings, Price/Book,
Price/Sales, Enterprise Value/EBITDA and Breakup Value are the most prevalent.
We also pay close attention to normalized earnings for cyclical industries. Our
focus is more on stocks that are cheap versus their own historical valuation
ranges rather than against the market as a whole.
While cheap stocks tend to offer less downside risk than the overall market,
our primary focus is on those stocks where business is getting better and there
is good potential for positive earnings surprises. We spend a lot of time
talking to managements of out-of-favor companies and industries in order to
identify positive turns in business trends before the improvements become widely
known by Wall Street. As holdings appreciate to fair value we sell them even if
business conditions remain very favorable. Our dedication to the "value" style
of investing is of paramount importance. Additionally, our analysis is done on a
stock-by-stock basis. Our sector weightings result from detailed bottom-up
analysis of individual securities. To help control risk, we run a highly
diversified portfolio, which typically holds more than 150 names. The portfolio
is well diversified by economic sector as well. We believe that this
value-oriented and risk averse strategy is particularly well suited to today's
expensive market environment.
<PAGE>
The Consumer Sector
We continued to identify numerous attractively valued small capitalization
stocks in the market, despite the broader market indices trading at all-time
highs. This was due to the considerable volatility in the prices of individual
securities. We believe that as investors become increasingly focused on the
short-term outlook for companies (i.e. next quarter's earnings sustainability),
they are missing the long-term picture in the business analysis. With a
perspective that is both short- and long-term, value-oriented, and
research-driven, we try to capitalize on the volatility in the current stock
market.
We continued to find what we believe to be attractively valued stocks within
the consumer services and consumer non-durables sectors. There are numerous
examples of stocks that used to trade at very rich earnings multiples that have
been severely penalized by the market because of short-term challenges or a
modest deceleration of growth. Yet, many of these companies are high quality,
consistent long-term growers. For example, Ann Taylor Stores stumbled recently
by failing to anticipate fashion trends last year. But, with the shares recently
trading at book value, new fashions on the way and very easy sales comparisons
for the next 12 months, Ann Taylor Stores is one of our largest holdings.
Furthermore, the shares trade at less than 10 times our estimate of normalized
earnings power.
Technology Outlook
We have substantially raised our weighting in technology following the severe
decline experienced by the sector due to concerns about Asia. While it is true
that many technology companies have a higher concentration of sales in Asia than
most other companies, the declines in the prices of many high quality, high
growth enterprises have been too severe, in our opinion. Many technology issues
are trading at levels close to their all-time lows on many valuation measures.
While there are some short-term business risks for many of these companies,
particularly if Asia continues to deteriorate, the upside potential of the
stocks is quite considerable once all of the bad news out of Asia has been fully
discounted in the stock prices. It is our contention that we are getting closer
to that point. Semiconductor capital equipment stocks have been an area of focus
for us recently. Many stocks have been cut in half or more because of a dramatic
business slowdown. We contend, however, that the depth of the slowdown will only
add to the strength of the recovery sometime in 1999. We view the downside as
modest since there are no expectations for the stocks. The first sign of an
upturn, however, could lead to a period of material outperformance.
The Energy Sector
Energy stock valuations have become very compelling after significantly
trailing the market in 1997 and early 1998. Most exploration and production
(E&P) companies trade at the low end of historical valuation ranges. For the
most part, this is due to falling energy prices. We do not try to forecast
energy prices. While energy prices fluctuate, we are comforted by the very low
valuations and strong production growth characteristics of the E&P companies
recently added to the Fund. We have also added energy services stocks, which
until recently were not cheap enough given our valuation criteria. Halter Marine
Group, for example, was purchased in the mid-teens, down from a high of $41.50.
While the steep price decline was partly caused by recent operational
challenges, we would contend that they are temporary in nature, and Halter
Marine could benefit from a multi-year upturn in demand for new rig and boat
construction.
<PAGE>
Capital Goods, Utilities and Financials
We have found numerous attractively valued companies in the capital goods
sector. Several of these names, such as Avondale Industries, a shipbuilder,
serve the defense industry. Recently, Avondale demonstrated its commitment to
shareholder value by announcing a Dutch Auction for 9% of its shares.
Separately, DONCASTERS A.D.S., which makes complex components for jet engines
and industrial and gas turbines, continues to post positive earnings and is
cheap at 10 times 1999 estimated earnings.
Utilities were among the best performing stocks at the end of 1997. This was
driven by falling interest rates and, more importantly, investors seeking safe
havens from the risks of earnings disappointments due to the Asian crisis. While
such defensive tendencies can continue to drive utilities higher, we don't own
stocks in the group because growth prospects are anemic, business momentum is
neutral, and political risk is high.
We continue to reduce our holdings of financial stocks because valuations are
not compelling. As with the broader market, financials are trading well above
historical multiple ranges on such measures as price/earnings and price/book. In
part, this is due to the consolidation trend within the banking sector, as the
potential takeover premiums are built into many stocks. We are disciplined about
valuation, however, and won't buy stocks in the hopes of a takeover. One area
where we continue to find small value is thrifts. Our largest long-term holding
is in Astoria Financial/Long Island Bancorp (the companies are merging). The
combined entity trades for less than 10 times 1999 cash earnings after
discounting the value of its supervisory good will lawsuit versus the
government. By contrast, most of its peers trade at 15 times 1999 cash earnings.
We believe that in due course, the investment philosophy that we follow will
prove itself once again. It is a pleasure and a privilege to serve your
investment needs.
Sincerely,
/s/ Peter I. Higgins
Peter I. Higgins
Portfolio Manager
May 18, 1998
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains paid.
** SOURCE: LIPPER ANALYTICAL SERVICES, INC.--Reflects the reinvestment of income
dividends and, where applicable, capital gain distributions. The Russell 2000
Index is a widely accepted unmanaged index of small cap stock performance.
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Investments April 30, 1998 (Unaudited)
Common Stocks--98.9% Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C> <C>
Basic Industries--8.7% Armco......................................(a) 310,100 $ 2,131,938
Birmingham Steel.............................. 145,100 2,321,600
Brown Group................................... 57,600 918,000
CalMat........................................ 257,800 6,751,138
Carbide/Graphite Group.....................(a) 7,000 225,750
ChemFirst..................................... 11,800 314,175
Cherry, Cl. B..............................(a) 70,400 1,328,800
Commercial Intertech.......................... 138,700 2,990,719
Crossmann Communities......................(a) 60,550 1,649,988
Gaylord Container, Cl. A...................(a) 629,600 6,059,900
Guilford Mills................................ 134,500 3,799,625
Huntco, Cl. A................................. 103,100 1,404,738
IMCO Recycling................................ 126,200 2,334,700
Keystone Consolidated Industries...........(a) 84,800 1,001,700
Philip Services............................(a) 597,285 4,516,968
RMI Titanium...............................(a) 31,100 693,919
Synopsys...................................(a) 55,254 2,375,922
Wausau-Mosinee Paper.......................... 95,000 2,012,813
------------
42,832,393
------------
Capital Goods--13.1% Alliant Techsystems........................(a) 85,500 5,466,656
Amcast Industrial............................. 97,700 2,106,656
American Buildings.........................(a) 70,700 2,456,825
Aviall.....................................(a) 226,700 3,173,800
Avondale Industries........................(a) 161,600 4,343,000
Breed Technologies............................ 111,800 2,256,962
Chicago Bridge & Iron N.V..................... 163,600 2,658,500
CTB International..........................(a) 48,000 720,000
Cubic......................................... 6,000 161,625
Danka Business Systems, A.D.R................. 205,400 4,108,000
Denison International......................... 107,500 1,935,000
DONCASTERS, A.D.S............................. 182,900 5,624,175
Elsag Baily Process Automation, N.V........(a) 63,500 1,266,031
Essex International........................(a) 74,700 2,679,862
Fairchild, Cl. A...........................(a) 195,900 3,991,462
Genlyte Group..............................(a) 23,600 600,325
Intermet...................................... 6,400 134,400
Newport News Shipbuilding..................... 157,400 4,279,312
OmniQuip International........................ 197,600 4,618,900
Onix Systems.................................. 98,800 1,420,250
Richardson Electronics........................ 57,800 722,500
Shaw Group.................................(a) 70,500 1,656,750
Specialty Equipment........................(a) 29,800 670,500
Vivid Technologies.........................(a) 62,800 879,200
Wabash National............................... 107,300 3,312,888
Wolverine Tube.............................(a) 78,700 3,098,813
------------
64,342,392
------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Investments (continued) April 30, 1998 (Unaudited)
Common Stocks (continued) Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C> <C>
Consumer Durables--4.9% Beazer Homes USA...........................(a) 68,400 $ 1,667,250
Camco ........................................ 22,797 96,354
Donnelly, Cl. A............................... 92,900 1,858,000
Global Industrial Technologies.............(a) 96,900 1,738,144
Global-Tech Appliances........................ 24,600 482,775
Insurance Auto Auction.....................(a) 243,000 2,976,750
Kaufman & Broad Home.......................... 57,200 1,662,375
LADD Furniture.............................(a) 151,700 4,323,450
MascoTech..................................... 92,800 2,163,400
Newmark Homes................................. 48,200 494,050
O'Sullivan Industries......................(a) 60,200 910,525
Special Devices............................(a) 99,400 3,280,200
Standard Products............................. 37,900 1,212,800
TriStar Aerospace............................. 64,000 1,056,000
------------
23,922,073
------------
Consumer Non-Durables--6.1% Ball.......................................... 136,300 5,264,587
Bell Sports................................(a) 7,600 74,100
Borg-Warner Security.......................(a) 214,900 4,378,587
Galoob Toys................................(a) 202,000 2,184,125
Huffy......................................... 163,500 2,677,312
Oxford Industries............................. 19,000 676,875
Perrigo....................................(a) 284,700 3,683,306
Phillips-Van Heusen........................... 213,500 2,521,969
Pilgrim's Pride............................... 306,200 5,205,400
Smucker (J.M.), Cl. A......................... 26,400 636,900
Vans.......................................(a) 217,900 2,573,944
------------
29,877,105
------------
Consumer Services--18.8% American Media, Cl. A......................(a) 230,300 1,727,250
Ann Taylor Stores..........................(a) 395,800 6,308,062
Apple South................................... 240,800 3,792,600
Applebee's International...................... 68,700 1,708,912
Boyd Gaming................................(a) 325,300 2,277,100
Buffets....................................(a) 314,900 4,664,456
Cadmus Communication.......................... 96,800 2,528,900
Carmike Cinemas, Cl. A.....................(a) 53,000 1,606,562
Claire's Stores............................... 188,600 4,113,838
CMP Media, Cl. A.............................. 62,100 1,436,062
Cox Radio, Cl. A...........................(a) 53,200 2,573,550
Damark International, Cl. A................(a) 7,700 81,812
Discount Auto Parts........................(a) 101,700 2,447,156
Emmis Broadcasting, Cl. A..................(a) 133,000 6,882,750
Finish Line, Cl. A.........................(a) 167,200 4,138,200
Finlay Enterprises.........................(a) 164,900 4,514,138
Gymboree...................................(a) 261,700 4,808,738
J & J Snack Foods..........................(a) 172,400 3,361,800
Lone Star Steakhouse/Saloon................(a) 142,100 3,019,625
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Investments (continued) April 30, 1998 (Unaudited)
Common Stocks (continued) Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C> <C>
Consumer Services (continued) Marsh Supermarkets, Cl. A..................... 42,500 $ 632,188
May & Speh.................................(a) 140,300 2,086,962
Miller Industries..........................(a) 331,600 2,611,350
Paxson Communications......................(a) 131,900 1,772,406
Pittston Burlington Group..................... 57,800 1,083,750
Provigo....................................... 164,568 959,999
Ruby Tuesday.................................. 27,300 914,550
Sapiens International......................... 324,200 2,917,800
Station Casinos............................(a) 210,200 3,126,725
Sunglass Hut International.................(a) 323,900 3,097,294
Talbots....................................... 113,800 2,162,200
True North Communications..................... 62,800 1,915,400
Unisource Worldwide........................... 183,100 2,323,081
Young Broadcasting, Cl. A..................(a) 98,400 4,920,000
------------
92,515,216
------------
Energy--8.0% Devon Energy.................................. 82,300 3,281,712
Eagle Geophysical............................. 87,800 1,635,275
EEX........................................(a) 130,600 1,265,188
Forcenergy.................................(a) 213,000 4,912,312
Giant Industries.............................. 125,000 2,703,125
Halter Marine Group........................(a) 293,400 5,317,875
Horizon Offshore.............................. 139,300 2,028,556
Houston Exploration........................(a) 201,100 4,700,713
Lomak Petroleum............................... 336,500 4,647,906
Petsec Energy, A.D.R.......................(a) 61,800 1,270,763
RPC........................................... 82,300 1,095,619
Santa Fe Energy Resources..................(a) 439,600 4,533,375
Titan Exploration..........................(a) 211,600 1,758,925
------------
39,151,344
------------
Financial Services--8.4% Albank Financial.............................. 21,900 1,149,750
American Residential Investment Trust......... 180,400 2,232,450
Anthracite Capital............................ 130,400 1,825,600
Astoria Financial............................. 98,988 5,803,172
Bank Plus..................................(a) 62,600 880,312
Bay View Capital.............................. 60,800 1,983,600
Citizens...................................... 13,600 435,200
Downey Financial.............................. 28,345 983,217
FirstFed Financial.........................(a) 57,900 2,648,925
First Savings Bank of Washington Bancorp...... 12,300 326,719
Golden State Bancorp.......................(a) 117,360 4,577,040
Guarantee Life Cos............................ 72,700 1,971,988
Klamath First Bancorp......................... 7,300 156,038
Long Island Bancorp........................... 108,400 7,154,400
PFF Bancorp................................(a) 128,500 2,602,125
Progressive Bank.............................. 22,400 961,800
Resource Bancshares Mortgage Group............ 145,400 2,580,850
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- ------------------------------------------------------------------------------
Statement of Investments (continued) April 30, 1998 (Unaudited)
Common Stocks (continued) Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C> <C>
Financial Services (continued) SCPIE Holdings................................ 89,200 $ 3,027,225
------------
41,300,411
------------
Health Care--5.8% Angelica..................................... 61,300 1,348,600
Conmed.....................................(a) 271,600 6,212,850
Elscint....................................(a) 96,400 668,775
Haemonetics................................(a) 224,200 3,979,550
Hologic....................................(a) 176,600 4,150,100
Quest Diagnostics..........................(a) 246,000 4,735,500
Respironics................................(a) 190,700 3,182,306
SpaceLabs Medical..........................(a) 150,000 2,681,250
Superior Surgical............................. 105,000 1,798,125
------------
28,757,056
------------
Retail Trade--.3% Bon-Ton Stores.............................(a) 78,300 1,282,163
------------
Technology--19.7% ADFlex Solutions...........................(a) 16,800 365,400
ARDENT Software............................(a) 226,800 3,203,550
C-Cor Electronics..........................(a) 18,600 274,350
Caere .....................................(a) 156,200 2,108,700
CFM Technologies...........................(a) 12,100 152,762
CHS Electronics............................(a) 257,600 5,377,400
CompuCom Systems...........................(a) 103,700 777,750
Credence Systems...........................(a) 174,500 4,809,656
Diamond Multimedia Systems.................(a) 232,200 2,699,325
Electroglas................................(a) 87,000 1,468,125
Exar.......................................(a) 5,900 148,238
FSI International..........................(a) 97,200 1,142,100
General Semiconductor......................(a) 50,600 692,588
GT Interactive Software....................(a) 208,200 2,199,112
Hypercom...................................(a) 139,000 1,807,000
In Focus Systems...........................(a) 283,900 2,448,638
Inso.......................................(a) 212,900 3,832,200
International Rectifier....................(a) 30,100 353,675
Kulicke & Soffa Industries.................(a) 155,000 3,332,500
Lam Research...............................(a) 123,800 3,837,800
Learning Company...........................(a) 307,100 8,790,738
LTX........................................(a) 337,600 1,624,700
Mattson Technology.........................(a) 256,700 1,780,856
Micro Linear...............................(a) 246,000 1,445,250
Mosaix.....................................(a) 82,600 960,225
Oak Industries.............................(a) 197,200 7,160,825
Ortel......................................(a) 61,500 834,094
Pioneer Standard Electronics.................. 119,700 1,503,731
Planar Systems.............................(a) 104,100 1,275,225
Progress Software..........................(a) 78,300 2,505,600
Quality Semiconductor......................(a) 135,800 509,250
Qualix Group...............................(a) 201,000 590,438
Quickturn Design System....................(a) 108,700 1,141,350
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- ------------------------------------------------------------------------------
Statement of Investments (continued) April 30, 1998 (Unaudited)
Common Stocks (continued) Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C> <C>
Technology (continued) Rainbow Technologies.......................(a) 71,800 $ 1,777,050
Read-Rite..................................(a) 103,200 1,425,450
Sequent Computer Systems...................(a) 116,200 2,280,425
Shiva......................................(a) 231,800 2,578,775
Silicon Storage Technology.................(a) 200,600 601,800
Silicon Valley Group.......................(a) 121,000 2,299,000
SpeedFam International.....................(a) 24,900 722,100
Symantec...................................(a) 188,600 5,469,400
Trimble Navigation.........................(a) 266,500 4,930,250
VTEL.......................................(a) 68,200 383,625
Watkins-Johnson............................... 118,600 3,298,562
------------
96,919,588
------------
Transportation--5.1% American Freightways.......................(a) 249,300 2,991,600
Arkansas Best..............................(a) 488,900 5,133,450
Arnold Industries............................. 141,400 2,262,400
Atlas Air..................................(a) 103,800 4,048,200
Covenant Transport, Cl. A..................(a) 68,300 1,301,969
Knightsbridge Tankers......................... 54,419 1,564,546
Mullen Transportation......................... 75,284 1,209,677
Old Dominion Freight Line..................(a) 84,800 1,547,600
Tranz Rail Holdings, A.D.S.................... 100,100 1,051,050
Yellow.....................................(a) 214,100 3,840,419
------------
24,950,911
------------
TOTAL COMMON STOCKS
(cost $453,241,912)........................ $485,850,652
============
Principal
Short-Term Investments--3.2% Amount
- ------------------------------------------------------------------------------- -----------
U.S. Treasury Bills: 5.04%, 5/28/1998...........................(b) $ 1,607,000 $ 1,601,504
4.97%, 7/2/1998............................(b) 98,000 97,182
4.89%, 7/30/1998.............................. 14,263,000 14,089,990
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $15,786,540)......................... $ 15,788,676
============
TOTAL INVESTMENTS (cost $469,028,452).......................................... 102.1% $501,639,328
====== ============
LIABILITIES, LESS CASH AND RECEIVABLES......................................... (2.1%) $(10,410,445)
====== ============
NET ASSETS..................................................................... 100.0% $491,228,883
====== ============
<FN>
Notes to Statement of Investments:
- ------------------------------------------------------------------------------------------------------------------------
(a) Non-income producing.
(b) Partially held by broker as collateral for open short positions.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Investments (continued) April 30, 1998 (Unaudited)
Statement of Securities Sold Short Shares Value
- ------------------------------------------------------------------------------- ---------- -------------
<S> <C> <C>
American Oilfield Divers....................................................... 40,000 $ 630,000
Chromcraft Revington........................................................... 35,300 1,367,875
Sofamor Danek Group............................................................ 9,300 816,075
------------
TOTAL SECURITIES SOLD SHORT
(proceeds $2,121,087)....................................................... $ 2,813,950
============
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- ------------------------------------------------------------------------------
Statement of Assets and Liabilities April 30, 1998 (Unaudited)
Cost Value
----------- -----------
<S> <C> <C> <C>
ASSETS: Investments in securities--See Statement of Investments...... $469,028,452 $501,639,328
Cash......................................................... 75,213
Receivable for investment securities sold.................... 6,761,188
Receivable from brokers for proceeds on securities sold short 2,121,087
Receivable for shares of Common Stock subscribed............. 588,707
Dividends and interest receivable............................ 120,778
Prepaid expenses............................................. 107,989
------------
511,414,290
------------
LIABILITIES: Due to The Dreyfus Corporation and affiliates................ 325,609
Due to Distributor........................................... 102,037
Payable for investment securities purchased.................. 10,141,443
Payable for shares of Common Stock redeemed.................. 6,692,037
Securities sold short, at value
(proceeds $2,121,087)--see statement....................... 2,813,950
Interest payable--Note 2..................................... 1,683
Accrued expenses............................................. 108,648
------------
20,185,407
------------
NET ASSETS........................................................................... $491,228,883
============
REPRESENTED BY: Paid-in capital.............................................. $428,979,010
Accumulated investment (loss)................................ (623,892)
Accumulated net realized gain (loss) on investments,
options written and securities sold short.................. 30,955,784
Accumulated net unrealized appreciation (depreciation)
on investments, foreign currency transactions
and securities sold short--Note 4(b)....................... 31,917,981
------------
NET ASSETS........................................................................... $491,228,883
============
SHARES OUTSTANDING
(100 million shares of $.001 par value Common Stock authorized)...................... 20,778,240
NET ASSET VALUE, offering and redemption price per share--Note 3(d).................. $23.64
======
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Operations Six Months Ended April 30, 1998 (Unaudited)
INVESTMENT INCOME
<S> <C> <C> <C>
INCOME: Cash dividends (net of $4,651 foreign taxes
withheld at source).......................... $ 1,562,256
Interest....................................... 444,768
-----------
Total Income.............................. $ 2,007,024
EXPENSES: Management fee--Note 3(a)...................... 1,614,192
Shareholder servicing costs--Note 3(b)......... 803,409
Registration fees.............................. 64,438
Custodian fees--Note 3(b)...................... 37,657
Professional fees.............................. 34,742
Prospectus and shareholders' reports........... 25,492
Directors' fees and expenses--Note 3(c)........ 16,883
Dividends on securities sold short............. 7,920
Interest expense--Note 2....................... 1,683
Miscellaneous.................................. 8,169
-----------
Total Expenses............................ 2,614,585
-----------
INVESTMENT (LOSS)............................................................ (607,561)
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 4:
Net realized gain (loss) on investments:
Long transactions (including options written) $31,828,362
Short sale transactions...................... (404,922)
-----------
Net Realized Gain (Loss).................. 31,423,440
Net unrealized appreciation (depreciation) on
investments, options written and securities
sold short................................... 13,766,437
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS....................... 45,189,877
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS......................... $44,582,316
===========
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
Statement of Changes in Net Assets
Six Months Ended
April 30, 1998 Year Ended
(Unaudited) October 31, 1997
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Investment income (loss)--net.......................................... $ (607,561) $ 257,749
Net realized gain (loss) on investments................................ 31,423,440 6,631,396
Net unrealized appreciation (depreciation) on investments.............. 13,766,437 17,725,090
------------ ------------
Net Increase (Decrease) in Net Assets Resulting from Operations..... 44,582,316 24,614,235
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net................................................. (275,563) (46,432)
Net realized gain on investments....................................... (7,072,792) (2,431,882)
------------ ------------
Total Dividends..................................................... (7,348,355) (2,478,314)
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold.......................................... 214,431,576 460,227,849
Dividends reinvested................................................... 6,869,047 2,423,279
Cost of shares redeemed................................................ (144,043,793) (124,900,940)
------------ ------------
Increase (Decrease) in Net Assets from Capital Stock Transactions... 77,256,830 337,750,188
------------ ------------
Total Increase (Decrease) in Net Assets.......................... 114,490,791 359,886,109
NET ASSETS:
Beginning of Period.................................................... 376,738,092 16,851,983
------------ ------------
End of Period.......................................................... $491,228,883 $376,738,092
============ ============
Undistributed investment income (loss)--net............................... $ (623,892) $ 259,232
------------ ------------
Shares Shares
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................ 9,893,959 22,290,239
Shares issued for dividends reinvested................................. 320,684 145,455
Shares redeemed........................................................ (6,598,470) (6,227,693)
------------ ------------
Net Increase (Decrease) in Shares Outstanding....................... 3,616,173 16,208,001
============ ============
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Dreyfus Small Company Value Fund
- -------------------------------------------------------------------------------
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 Fund's financial statements.
Six Months Ended Year Ended October 31,
April 30, 1998 -------------------------------------------
PER SHARE DATA: (Unaudited) 1997 1996 1995 1994(1)
---------------- ------ ------ ------ --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period............. $21.95 $17.66 $14.00 $12.43 $12.50
------ ------ ------ ------ ------
Investment Operations:
Investment income--net........................... (.02) -- .07 .10 .30
Net realized and unrealized gain (loss)
on investments................................ 2.12 6.43 4.69 2.33 (.37)
------ ------ ------ ------ ------
Total from Investment Operations................. 2.10 6.43 4.76 2.43 (.07)
------ ------ ------ ------ ------
Distributions:
Dividends from investment income--net............ (.02) (.04) (.09) (.33) --
Dividends from net realized gain
on investments................................ (.39) (2.10) (1.01) (.53) --
------ ------ ------ ------ ------
Total Distributions.............................. (.41) (2.14) (1.10) (.86) --
------ ------ ------ ------ ------
Net asset value, end of period................... $23.64 $21.95 $17.66 $14.00 $12.43
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN............................. 9.71%(2) 40.22% 35.99% 21.30% (.56%)(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to average net assets .60%(2) 1.23% 1.27% .84% --
Ratio of interest expense and dividends on securities
sold short to average net assets.............. .00%(3) .02% .02% .07% .01%(2)
Ratio of net investment income
to average net assets......................... (.14%)(2) .22% .62% .79% 2.39%(2)
Decrease reflected in above expense ratios
due to undertakings by Dreyfus................ -- .05% .41% 1.80% 2.07%(2)
Portfolio Turnover Rate.......................... 50.57%(2) 76.11% 183.58% 161.01% 219.63%(2)
Average commission rate paid(4).................. $.0503 $.0522 $.0509 -- --
Net assets, end of period (000's Omitted)........ $491,229 $376,738 $16,582 $6,404 $5,166
<FN>
- -----------------
(1) From December 29, 1993 (commencement of operations) to October 31, 1994.
(2) Not annualized.
(3) Amount represents less than .01%.
(4) For fiscal years beginning November 1, 1995, the Fund is required to
disclose its average commission rate paid per share for purchases and sales
of investment securities.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Small Company Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus Small Company Value Fund (the "Fund") is a separate diversified
series of Dreyfus Growth and Value Funds, Inc. (the "Company") which is
registered under the Investment Company Act of 1940 ("Act") as an open-end
management investment company and operates as a series company currently
offering nine series including the Fund. The Fund's investment objective is
capital appreciation. The Dreyfus Corporation ("Dreyfus") serves as the Fund's
investment adviser. Dreyfus is a direct subsidiary of Mellon Bank, N.A.
("Mellon"). The Boston Company Asset Management, Inc. ("TBC Asset Management"),
an indirect subsidiary of Mellon and an affiliate of Dreyfus, serves as the
Fund's sub-investment adviser. Premier Mutual Fund Services, Inc. (the
"Distributor") is the distributor of the Fund's shares, which are sold to the
public without a sales charge.
The Company accounts separately for the assets, liabilities and operations of
each fund. Expenses directly attributable to each fund are charged to that
fund's operations; expenses which are applicable to all series are allocated
among them on a pro rata basis.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities exchange
on which such securities are primarily traded or at the last sales price on the
national securities market. Securities not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices, except for open
short positions, where the asked price is used for valuation purposes. Bid price
is used when no asked price is available. Investments denominated in foreign
currencies are translated to U.S. dollars at the prevailing rates of exchange.
Forward currency exchange contracts are valued at the forward rate.
(b) Foreign currency transactions: The Fund does not isolate that portion of
the results of the operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and maturities
of short-term securities, sales of foreign currencies, currency gains or losses
realized on securities transactions and the difference between the amount of
dividends, interest and foreign withholding taxes recorded on the Fund's books
and the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains or 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) Dividends to shareholders: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain are normally declared and paid annually, but the Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the policy
of the Fund not to distribute such gain.
<PAGE>
Dreyfus Small Company Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
(e) Federal income taxes: It is the policy of the Fund to continue to qualify
as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the applicable provisions of
the Internal Revenue Code, and to make distributions of taxable income
sufficient to relieve it from substantially all Federal income and excise taxes.
NOTE 2--Bank Lines of Credit:
The Fund may borrow up to $10 million for leveraging purposes under a
short-term unsecured line of credit and participates with other Dreyfus-managed
funds in a $100 million unsecured line of credit primarily to be utilized for
temporary or emergency purposes, including the financing of redemptions.
Interest is charged to the Fund at rates which are related to the Federal Funds
rate in effect at the time of borrowings.
The average daily amount of borrowings outstanding under both arrangements
during the period ended April 30, 1998 was approximately $26,300, with a related
weighted average annualized interest rate of 6.40%.
NOTE 3--Investment Advisory Fee, Sub-Investment Advisory Fee and Other
Transactions With Affiliates:
(a) Pursuant to a management agreement with Dreyfus, the management fee is
computed at the annual rate of .75 of 1% of the value of the Fund's average
daily net assets and is payable monthly.
Pursuant to a Sub-Investment Advisory Agreement between Dreyfus and TBC Asset
Management, the sub-investment advisory fee is computed at the annual rate of
.375 of 1% of the value of the Fund's average daily net assets and is payable
monthly by Dreyfus.
(b) Under the Shareholder Services Plan, the Fund pays the Distributor at an
annual rate of .25 of 1% of the value of the Fund's average daily net assets for
the provision of certain services. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the Fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. The Distributor may
make payments to Service Agents (a securities dealer, financial institution or
other industry professional) in respect of these services. The Distributor
determines the amounts to be paid to Service Agents. During the period ended
April 30, 1998, the Fund was charged $538,064 pursuant to the Shareholder
Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
Dreyfus, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. During the period
ended April 30, 1998, the Fund was charged $157,964 pursuant to the transfer
agency agreement.
The Fund compensates Mellon under a custody agreement to provide custodial
services for the Fund. During the period ended April 30, 1998, the Fund was
charged $37,657 pursuant to the custody agreement.
(c) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $5,000 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(d) A 1% redemption fee is charged and retained by the Fund on certain
redemptions of Fund shares (including redemptions through use of the Fund
Exchanges service) where the shares being redeemed were issued subsequent to a
specified effective date and the redemption or exchange occurs less than fifteen
days following the date of issuance.
<PAGE>
Dreyfus Small Company Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
NOTE 4--Securities Transactions:
(a) The aggregate amount of purchases and sales of investment securities and
securities sold short, excluding short-term securities and option transactions,
during the period ended April 30, 1998 is summarized as follows:
Purchases Sales
-------------- --------------
Long transactions......................... $286,050,535 $214,420,667
Short sale transactions................... 2,426,909 88,810
------------ ------------
Total.................................. $288,477,444 $214,509,477
============ ============
The Fund is engaged in short-selling which obligates the Fund to replace the
security borrowed by purchasing the security at current market value. The Fund
would incur a loss if the price of the security increases between the date of
the short sale and the date on which the Fund replaces the borrowed security.
The Fund would realize a gain if the price of the security declines between
those dates. Until the Fund replaces the borrowed security, the Fund will
maintain daily, a segregated account with a broker and/or custodian, of cash
and/or liquid securities sufficient to cover its short position. Securities sold
short at April 30, 1998 and their related market values and proceeds are set
forth in the Statement of Securities Sold Short.
In addition, the following table summarizes the Fund's call options written
for the period ended April 30, 1998:
<TABLE>
<CAPTION>
Options Terminated
------------------------
Net
Number of Premiums Realized
Contracts Received Cost Gain
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
OPTIONS WRITTEN:
Contracts outstanding October 31, 1997.......... 2,471 $ 533,444
Contracts written............................... 897 159,966
-------- ----------
3,368 693,410
-------- ----------
Contracts Terminated:
Closed....................................... 397 53,882 $ 67,191 $ (13,309)
Exercised.................................... 447 140,391 -- --
Expired...................................... 2,524 499,137 -- 499,137
-------- ---------- ---------- ----------
Total contracts terminated................ 3,368 693,410 $ 67,191 $ 485,828
-------- ---------- ---------- ----------
Contracts outstanding April 30, 1998............ -- --
======== ==========
</TABLE>
The Fund may purchase and write (sell) put and call options in order to gain
exposure to or protect against changes in the market.
As writer of call options, the Fund receives a premium at the outset and then
bears the market risk of unfavorable changes in the price of the financial
instruments underlying the options. Generally, the Fund would incur a gain, to
the extent of the premium, if the price of the underlying financial instrument
decreases between the date the option is written and the date on which the
option is terminated. Generally, the Fund would realize a loss, if the price of
the financial instrument increases between those dates. At April 30, 1998, there
were no open options contracts outstanding.
(b) At April 30, 1998, accumulated net unrealized appreciation on investments
and securities sold short was $31,918,014 consisting of $58,621,373 gross
unrealized appreciation and $26,703,359 gross unrealized depreciation.
At April 30, 1998, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
<PAGE>
Dreyfus Small Company
Value Fund
200 Park Avenue
New York, NY 10166
Investment Advisor
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Sub-Investment Advisor
The Boston Company
Asset Management, Inc.
One Boston Place
Boston, MA 02108
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. 253SA984
