[GRAPHIC]
GABELLI INTERNATIONAL GROWTH FUND, INC.
THIRD QUARTER REPORT - SEPTEMBER 30, 1999
* * * *
MORNINGSTAR RATED(TM) GABELLI INTERNATIONAL GROWTH FUND 4 STARS OVERALL
AND FOR THE THREE-YEAR PERIOD ENDED 9/30/99 AMON
1025 INTERNATIONAL EQUITY FUNDS.
TO OUR SHAREHOLDERS,
The equity markets of most developed countries outside the United States
performed well during the third quarter of 1999. During the second quarter, many
emerging markets did well, but for the third quarter, it was Europe and Japan's
turn. In the three months ended September 30, 1999, the Nikkei 225 Index
appreciated by 14.2%, making Japan the top performing market for the quarter.
Most of this gain, it must be mentioned, was due to the strength of the yen
versus the dollar. During the quarter the yen appreciated from 121 per dollar to
106.3 per dollar. This is a significant move over a short period of time. The
dollar also weakened against the euro, but not to the same extent. The strength
of the euro helped the returns from European markets. For example, France and
Switzerland rose by 4.5% and 3.6%, respectively. Against this, both the United
Kingdom and German markets fell slightly. As a group, emerging markets declined
by 5.5%. This correction came after a stellar performance, albeit from a
depressed level, over the past year.
INVESTMENT PERFORMANCE
For the third quarter ended September 30, 1999, The Gabelli International
Growth Fund's (the "Fund") total return was 6.23%. The Lipper International Fund
Average and Morgan Stanley Capital International EAFE Index of international
markets had returns of 3.90% and 4.46%, respectively, over the same period. The
Morgan Stanley EAFE Index is an unmanaged indicator of stock market performance,
while the Lipper Average reflects the average performance of mutual funds
classified in this particular category. The Fund was up 27.65% over the trailing
twelve-month period. The Lipper International Fund Average and Morgan Stanley
EAFE Index rose 29.79% and 31.32%, respectively, over the same twelve-month
period.
- --------------------------------------------------------------------------------
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Morningstar proprietary
ratings reflect historical risk adjusted performance as of September 30, 1999
and are subject to change every month. Morningstar ratings are calculated from a
Fund's three, five and ten-year average annual returns in excess of 90-day
T-Bill returns with appropriate fee adjustments and a risk factor that reflects
fund performance below 90-day T-Bill returns. The top 10% of the funds in a
broad asset class receive five stars, the next 22.5% receive four stars, the
next 35% receive three stars, the next 22.5% receive two stars and the bottom
10% receive one star.
<PAGE>
INVESTMENT RESULTS (a)
<TABLE>
<CAPTION>
===================================================================================================================
Quarter
-------------------------------------------
1st 2nd 3rd 4th Year
--- --- --- --- ----
<S> <C> <C> <C> <C> <C>
1999: Net Asset Value ..................... $15.94 $16.38 $17.40 __ __
Total Return ........................ 2.0% 2.8% 6.2% __ __
- --------------------------------------------------------------------------------------------------------------------
1998: Net Asset Value ..................... $17.03 $17.58 $14.74 $15.63 $15.63
Total Return ........................ 18.3% 3.2% (16.2)% 14.7% 17.4%
- --------------------------------------------------------------------------------------------------------------------
1997: Net Asset Value ..................... $13.51 $14.67 $15.31 $14.40 $14.40
Total Return ........................ 0.7% 8.6% 4.4% (5.9)% 7.3%
- --------------------------------------------------------------------------------------------------------------------
1996: Net Asset Value ..................... $11.71 $12.55 $12.53 $13.42 $13.42
Total Return ........................ 6.6% 7.2% (0.2)% 7.1% 22.2%
- --------------------------------------------------------------------------------------------------------------------
1995: Net Asset Value ..................... __ __ $10.57 $10.98 $10.98
Total Return ........................ __ __ 5.7%(b) 3.9% 9.8%(b)
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS - SEPTEMBER 30, 1999 (A)
1 Year .................................... 27.65%
3 Year .................................... 14.51%
Life of Fund (b) .......................... 16.00%
- --------------------------------------------------------------------------------
DIVIDEND HISTORY
- --------------------------------------------------------------------------------
PAYMENT (EX) DATE RATE PER SHARE REINVESTMENT PRICE
- ----------------- -------------- ------------------
December 28, 1998 $1.260 $15.49
(a) Total returns and average annual returns reflect changes in share price and
reinvestment of dividends and are net of expenses. The net asset value of the
Fund is reduced on the ex-dividend (payment) date by the amount of the dividend
paid. Of course, returns represent past performance and do not guarantee future
results. Investment returns and the principal value of an investment will
fluctuate. When shares are redeemed they may be worth more or less than their
original cost. (b) From commencement of investment operations on June 30, 1995.
Note: Investing in foreign securities involves risks not ordinarily associated
with investments in domestic issues, including currency fluctuation, economic
and political risks.
================================================================================
For the three-year period ended September 30, 1999, the Fund's total
return averaged 14.51% annually, versus average annual total returns of 11.15%
and 10.73% for the Lipper International Fund Average and Morgan Stanley EAFE
Index, respectively. Since inception June 30, 1995 through September 30, 1999,
the Fund had a cumulative total return of 88.15%, which equates to an average
annual return of 16.00%.
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OUR APPROACH
We purchase attractively valued companies which we believe have the
opportunity to grow earnings more rapidly than the average in that company's
local market. We pay close attention to a company's market position, management
and balance sheet, with particular emphasis on the ability of the company to
finance its growth. Generally, we value a company relative to its local market
but, where appropriate, will attempt to benefit from valuation discrepancies
between markets. Our primary focus is on security selection and not country
allocation, but the Fund will remain well diversified by sector and geography.
Country allocation is likely to reflect broad economic, financial and currency
trends as well as the relative size of the market.
INTERNATIONAL ALLOCATION
The accompanying chart presents the Fund's holdings by geographic region
as of September 30, 1999. The geographic allocation will change based on current
global market conditions. Countries and/or regions represented in the chart and
below may or may not be included in the Fund's future portfolio.
[The following table represents a pie chart in the printed piece.]
HOLDINGS BY GEOGRAPHIC REGION -- 9/30/99
Japan 29.7%
United Kingdom 22.0%
Other Europe 19.2%
Switzerland 12.0%
France 8.0%
Australia 5.1%
South Africa 1.6%
Canada 1.3%
United States 1.1%
COMMENTARY
Perhaps the most important sign from the performance of international
markets in the third quarter is that many had positive returns in the absence of
U.S. market leadership. Apart from the Nasdaq Composite Index, the indices that
measure the U.S. equity market's performance declined by about 6.5%. We believe
that there are indications that overseas equity markets may begin to outperform
the U.S. market, after having lagged for many years. This belief is based on our
positive outlook for Europe and Japan as opposed to a bearish view of the U.S.
market.
The baton of leadership in economic growth is probably in the process of
being passed from the U.S. to Europe and Japan. After suffering from very
sluggish economic growth, Japan and Europe appear to be making a comeback.
Recent economic news from Germany (the largest economy in Europe) and Italy
suggest that growth is accelerating. These two countries have been trailing the
Euroland pack in terms of economic activity.
In Japan, the government authorities remain determined to keep in place
the conditions necessary for the slow recovery that Japan is experiencing.
Stronger growth in Europe and Japan should lead to improved corporate earnings.
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We believe that monetary conditions also favor international markets. This
belief is based upon the situations of the major economic blocks in relation to
the economic cycle. The U.S. is experiencing higher interest rates as the
Federal Reserve attempts to cool the economy. In Japan, by contrast, the Bank of
Japan remains committed to a zero interest rate policy. In Euroland, short term
interest rates are 2.5% but are likely to rise in the near future to a more
normal level nearer to 3.5%.
We believe the investment case for Europe and Japan is primarily based
upon what companies themselves are doing and is not dependent upon government
action. In Europe, there are many examples of companies restructuring, cutting
costs, focusing on core activities and attempting to create scale in their
particular activity.
Let's take a look at France. The French have decided to create "National
Champions". BNP bought Paribas to extend its national reach in the banking
industry. TotalFina has agreed to buy Elf Aquitaine to form the world's fourth
largest oil company, and Sanofi has merged with Synthelabo resulting in a world
class pharmaceutical company. Most recently, Carrefour and Promodes have agreed
to merge and will become the world's second largest retailer behind Wal-Mart.
What's next? Renault is likely to get together with Peugeot. These French
companies will next look for opportunities outside France in a bid to become
European champions. TotalFina is already making eyes towards ENI, the Italian
state-controlled energy concern, and Seita, the French tobacco firm, is set to
merge with Tabacalera of Spain.
We anticipate that merger and acquisition activity will remain at a high
level in Europe, which will underpin markets. European companies now understand
that national governments will not protect them from a hostile bid but a high
share price will.
In Japan, more sectors of the economy are restructuring. In the last
quarter, the world's largest bank was created when Industrial Bank of Japan, DKB
and Fuji Bank agreed to merge. We expect further restructuring to occur among
institutions operating in Japan's financial industry. Most of the Fund's top
performing holdings during the past quarter were Japanese stocks. These included
Obic, a software company specializing in small companies, Japan Telecom and
Tokyo Broadcasting Systems. Among European holdings, the Fund's winners included
Vodafone AirTouch, NRJ (the French radio station operator), and Swatch (the
Swiss watch company).
LET'S TALK STOCKS
The following are stock specifics on selected holdings of our Fund.
Favorable earnings prospects do not necessarily translate into higher stock
prices, but they do express a positive trend which we believe will develop over
time. The share prices of the following holdings are stated in U.S. dollar
equivalent terms as of September 30, 1999.
COMPAGNIE FINANCIERE RICHEMONT AG (RIFZ.S - $2,002.23 - ZURICH STOCK
EXCHANGE) is one of the world's
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leading luxury goods companies with such brand names as Cartier, Piaget,
Montblanc, Karl Lagerfeld and Alfred Dunhill. The company also has a major
investment in tobacco. Richemont recently swapped its tobacco business, Rothmans
International, in exchange for a 25% stake in B.A.T., the world's second largest
tobacco company. Adjusted for its stake in B.A.T. and Vivendi, the French
utility and media conglomerate, the market values its wholly owned luxury goods
business at a significant discount to other luxury goods producers.
CRH PLC (CRH.L - $19.26 - LONDON STOCK EXCHANGE) is a Dublin, Ireland-based
international building materials company that has an excellent long-term track
record of increasing earnings per share. CRH is a leading producer and
distributor of a wide range of building products and materials that has grown by
making acquisitions that are complimentary to its existing operations. CRH's
diversity in its product line and geographic reach keep this company well
protected against a slow down in any one particular product segment or country.
This global presence should contribute to CRH's continued growth.
GRANADA GROUP PLC (GAA.L - $8.57 - LONDON STOCK EXCHANGE) is a dominant media
and hospitality company in the U.K. The company is focusing its efforts on
building leading brands that offer a full range of products and services in
their markets. Granada's strong management continues to lead an innovative
marketing, positioning and pricing plan which has resulted in strong performance
despite the weaker U.K. economy.
ITO YOKADO CO. LTD (8264.T - $82.39 - TOKYO STOCK EXCHANGE) is one of Japan's
leading retailers and operates supermarkets mainly in Tokyo and Kanagawa,
selling clothing, foodstuffs and household utensils. The company's subsidiaries
include Seven-Eleven Japan. Ito Yokado ranks second in industry sales and is
top-ranked in profits.
JAPAN TELECOM CO. LTD. (9434.T - $23,405.00 - TOKYO STOCK EXCHANGE) provides
domestic long distance telephone and leased line services through its fiber
optic cable network connected to local telephone exchanges owned by Nippon
Telegraph & Telephone and local common carriers. The company also participates
in other telecommunications-related businesses such as cellular telephone
services. British Telecommunications and AT&T have each recently taken a
significant stake in Japan Telecom and Vodafone AirTouch is a partner in its
cellular operations.
NESTLE SA (NESZ.S - $93.96 - ZURICH STOCK EXCHANGE), based in Switzerland, is
one of the world's leading food companies. Its major business groups include
beverages, milk products, prepared dishes and confectionery. Nestle invented
instant coffee and its brand Nescafe is the world's leading instant coffee.
Other well known brands that Nestle controls include Perrier, Carnation,
Stouffer's, Alcon and L'Oreal. Nestle's sales are spread over multiple regions
of the world, with particularly strong positions in developing countries which,
we believe, will contribute increasingly to revenues in the future. For
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example, twelve of the fifteen factories that Nestle opened in the past three
years were located in emerging markets. We expect fairly strong profit growth in
the medium term after a few years of lackluster performance.
NINTENDO CO. LTD. (7974.T - $158.97 - TOKYO STOCK EXCHANGE) is best known for
its hand-held game machine called Game Boy. Nintendo is expected to soon
introduce its next generation Game Boy, which is likely to have interactive
capabilities. In addition, the company is also expected to introduce a
replacement for the Nintendo 64 system to be called Dolphin. Nintendo is the
leading electronic games company with a very strong balance sheet and a large
amount of net cash.
NOVARTIS AG (NOVZN.S - $1,481.73 - ZURICH STOCK EXCHANGE) is the Swiss based
pharmaceutical and life sciences company. Novartis is the largest pharmaceutical
company in terms of sales and is also the largest global agrochemical company.
Novartis' pharmaceutical business represents roughly two thirds of sales, with
agribusiness comprising one quarter and the balance belonging to the nutrition
business. Novartis' principal products include Sandimmune/Neoral, the organ
transplant rejection drug, and Lescol, the lipid-lowering agent.
OBIC CO. LTD. (4684.T - $465.76 - TOKYO STOCK EXCHANGE) provides computer system
integration, office automation, consultation, and system support services for
small and medium size companies. The company also trades, sells, leases and
maintains computer, peripheral and related systems in addition to developing
customized software and network systems. Obic has sales ties with Fujitsu,
Mitsubishi Electric, Hewlett-Packard, and IBM, and is also well positioned to
benefit from proprietary software systems.
PEARSON PLC (PSON.L - $21.45 - LONDON STOCK EXCHANGE) is a leading global
publisher with many strong brands. The company has tripled the size of its
educational publishing unit through the Simon & Schuster acquisition as well as
seen its Financial Times Group flourish both in print and electronically.
Pearson will continue to grow as the company positions itself ahead of the
trends that are shaping the industry. The company's television business
continues to grow and its Internet content is strengthening.
ROCHE HOLDING AG (ROCZG.S - $11,558.95 - ZURICH STOCK EXCHANGE) is primarily a
pharmaceutical company that also operates in vitamins and fine chemicals,
diagnostics, and flavors and fragrances. Pharmaceuticals make up approximately
sixty percent of sales, vitamins and fine chemicals comprise approximately
fifteen percent, diagnostics make up roughly nineteen percent and the balance is
the flavors and fragrances business. Roche's pharmaceutical business should
benefit from its strong pipeline as well as additional synergies from Roche's
acquisition of Boehringer Mannheim.
SONY CORP. (6758.T - $148.95 - TOKYO STOCK EXCHANGE) develops and manufactures
consumer and industrial electronic equipment. The company's products include
audio and video equipment, televisions, displays, semiconductors, electronic
components, computers and computer peripherals, and
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telecommunication equipment. Sony will focus on evolving digital network
technology in its electronics business. In July, the Columbia House record and
video club subsidiary announced plans to merge with CDNow. After the merger,
Sony will have a 37% stake in the new company.
THK CO. LTD. (6481.T - $29.40 - TOKYO STOCK EXCHANGE) is a manufacturer of
linear motion (rolling linear motion guide) systems for various industrial
machines, including machine tools. In addition, the company also manufactures
feed screws, special bearings and mechanical tools. THK controls 70% of the
domestic market within Japan and 50% of the worldwide market.
TOKYO BROADCASTING SYSTEM INC. (9401.T - $20.08 - TOKYO STOCK EXCHANGE) is a
media company, nationally broadcasting television and radio programs. The
company is active in television program production, film production, recorded
music, and both domestic and international cable television programming. Tokyo
Broadcasting also produces and sells software, videotapes, CD-ROMs, and DVDs.
The company is in the process of launching digital satellite broadcasting in a
joint venture with Sumitomo and is also considering spinning off its radio and
other production divisions.
VODAFONE AIRTOUCH PLC (VOD - $237.75 - NYSE) has created a dominant global
mobile communications service provider through the completion of its recent
acquisition of AirTouch in the United States. The company has grown its customer
base by over two million subscribers over the past year to command upwards of
37% of the wireless market, with nearly half of those subscribers outside of the
United Kingdom. Vodafone continues to engage in agreements and joint ventures on
a global basis, including the announcement of the formation of a cellular
operator in the United States with Bell Atlantic and GTE and a $550 million
investment in nine of Japan's regional cellular operators. Vodafone AirTouch
will also continue to position itself to benefit from the growth of data traffic
over its network.
MINIMUM INITIAL INVESTMENT - $1,000
The Fund's minimum initial investment for both regular and retirement
accounts is $1,000. There are no subsequent investment minimums. No initial
minimum is required for those establishing an Automatic Investment Plan.
Additionally, The Gabelli International Growth Fund and other Gabelli Funds are
available through the no-transaction fee programs at many major discount
brokerage firms.
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INTERNET
You can now visit us on the Internet. Our home page at
http://www.gabelli.com contains information about Gabelli Asset Management Inc.,
the Gabelli Mutual Funds, IRAs, 401(k)s, quarterly reports, closing prices and
other current news. You can send us e-mail at [email protected].
IN CONCLUSION
A less robust performance by U.S. capital markets relative to
international markets may result in a weaker dollar. A lower dollar enhances
the return to U.S.-based investors with overseas investments. However, as we
have little confidence in our ability to forecast currency movements, the Fund
will not hedge its currency exposure. In our last report, we commented that the
Japanese authorities appeared determined to prevent the yen from strengthening
below 120 yen per dollar. In fact, they were unsuccessful and the yen soared to
106 per dollar by the end of September. This move enhanced the return from our
Japanese investments. Equally important, we remain surprised by the weakness of
the euro throughout 1999, but maybe the euro will surprise the market and regain
some of its losses.
The Fund's daily net asset value is available in the financial press and
each evening after 6:00 PM (Eastern Time) by calling 1-800-GABELLI
(1-800-422-3554). The Fund's Nasdaq symbol is GIGRX. Please call us during the
business day for further information.
Sincerely,
/s/ Caesar Bryan
--------------------------------
CAESAR BRYAN
President and Portfolio Manager
October 25, 1999
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TOP TEN HOLDINGS
SEPTEMBER 30, 1999
------------------
OBIC Co. Ltd. Roche Holding AG
Compagnie Financiere Richemont THK Co. Ltd.
Vodafone AirTouch plc Nestle SA
CRH plc Pearson plc
Novartis AG Nintendo Co. Ltd.
- --------------------------------------------------------------------------------
NOTE: The views expressed in this report reflect those of the portfolio manager
only through the end of the period stated in this report. The manager's views
are subject to change at any time based on market and other conditions.
8
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GABELLI INTERNATIONAL GROWTH FUND, INC.
PORTFOLIO OF INVESTMENTS -- SEPTEMBER 30, 1999 (UNAUDITED)
================================================================================
MARKET
SHARES VALUE
------ ------
COMMON STOCKS -- 99.7%
BROADCASTING -- 8.7%
6,500 Audiofina ....................... $ 328,587
72,000 Granada Group plc ............... 616,967
1,650 NRJ SA .......................... 447,783
5,400 Pathe SA ........................ 558,029
40,000 Publishing and Broadcasting Ltd. 238,907
29,000 Tokyo Broadcasting System Inc. .. 582,362
------------
2,772,635
------------
BUILDING AND CONSTRUCTION-- 2.7%
45,000 CRH plc ......................... 866,831
------------
BUSINESS SERVICES -- 5.8%
15,000 Asatsu-DK Inc. .................. 488,695
5,833 Reuters Holdings plc, ADR ....... 401,748
3,000 Secom Co. Ltd. .................. 266,816
3,000 Secom Co. Ltd., New+ ............ 272,434
6,000 Vivendi ......................... 421,124
------------
1,850,817
------------
CABLE -- 1.9%
3,500 NTL Inc.+ ....................... 336,328
75,000 Telewest Communications plc ..... 276,578
------------
612,906
------------
COMMUNICATIONS EQUIPMENT-- 1.0%
2,000 Mannesmann AG ................... 320,722
------------
COMPUTER SOFTWARE AND
SERVICES-- 5.2%
1,000 Cresco Ltd. ..................... 75,832
2,400 Obic Co. Ltd. ................... 1,117,821
4,000 Square Co. Ltd. ................. 293,592
3,000 Sumisho Computer Systems Corp. .. 171,324
------------
1,658,569
------------
CONSUMER PRODUCTS -- 10.1%
2,500 Christian Dior SA ............... 407,076
520 Compagnie Financiere Richemont AG 1,051,561
14,000 KAO Corp. ....................... 394,514
4,000 Nintendo Co. Ltd. ............... 635,866
550 Swatch Group AG ................. 427,611
31,071 Unilever plc .................... 292,590
------------
3,209,218
------------
ELECTRONICS -- 3.4%
13,000 Fujitsu Ltd. .................... 404,063
3,000 Sony Corp. ...................... 446,847
3,000 STMicroelectronics NV ........... 233,709
------------
1,084,619
------------
ENERGY AND UTILITIES-- 2.8%
23,000 BP Amoco plc .................... 419,922
1,000 Elf Aquitaine SA ................ 174,537
48,000 ENI SpA ......................... 300,885
------------
895,344
------------
ENTERTAINMENT -- 2.6%
1,050 Avex Inc. ....................... 194,636
6,000 Daiichi Kosho Co. Ltd. .......... 252,773
50,000 EMI Group plc ................... 365,478
------------
812,887
------------
EQUIPMENT AND SUPPLIES-- 2.1%
23,000 THK Co. Ltd. .................... 676,122
------------
FINANCIAL SERVICES-- 12.3%
32,005 Bank of Ireland ................. 261,252
25,000 Bank of Scotland ................ 298,186
89,492 Colonial Ltd. ................... 324,792
8,888 Invik & Co. AB, Cl. B ........... 569,535
6,000 Jafco Co. Ltd. .................. 502,738
23,000 Nikko Securities Co. Ltd. ....... 193,793
2,000 Nissin Co. Ltd. ................. 133,502
18,000 Prudential Corp. plc ............ 276,479
7,000 Safra Republic Holdings SA ...... 406,000
15,000 Schroders plc ................... 312,632
200 Shohkoh Fund & Co. Ltd. ......... 148,855
23,000 Skandia Forsakrings AB .......... 480,044
------------
3,907,808
------------
FOOD AND BEVERAGE -- 4.2%
170,000 Foster's Brewing Group Ltd. ..... 479,380
800 Groupe Danone ................... 194,545
7,000 Nestle SA, ADR .................. 657,746
------------
1,331,671
------------
HEALTH CARE -- 11.0%
14,126 AstraZeneca plc, London ......... 588,799
500 AstraZeneca plc, Stockholm ...... 20,966
23,000 Glaxo Wellcome plc .............. 599,780
5,000 Japan Lifeline Co. Ltd. ......... 112,344
500 Novartis AG ..................... 740,864
60 Roche Holding AG ................ 693,537
8,000 Sanofi SA ....................... 340,560
20,000 SmithKline Beecham plc .......... 229,988
10,000 SRL Inc. ........................ 177,878
------------
3,504,716
------------
METALS AND MINING -- 2.3%
1,500 Anglogold Ltd. .................. 94,461
5,000 Anglogold Ltd., ADR ............. 157,188
31,081 Antofagasta Holding plc ......... 202,628
37,500 Harmony Gold Mining Ltd. ........ 225,843
7,500 Harmony Gold Mining Ltd., ADR ... 45,000
------------
725,120
------------
PUBLISHING -- 7.3%
30,000 Arnoldo Mondadori Editore SpA ... 523,611
91,573 Independent News & Media plc .... 482,410
60,037 News Corp. Ltd. ................. 421,362
30,000 Pearson plc ..................... 643,538
24,000 Schibsted ASA ................... 237,041
------------
2,307,962
------------
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GABELLI INTERNATIONAL GROWTH FUND, INC.
PORTFOLIO OF INVESTMENTS (CONTINUED) -- SEPTEMBER 30, 1999 (UNAUDITED)
================================================================================
MARKET
SHARES VALUE
------ ------
COMMON STOCKS (CONTINUED)
RETAIL -- 2.3%
10,000 Centros Comerciales Continente SA $ 242,755
6,000 Ito Yokado Co. Ltd. ............. 494,313
------------
737,068
------------
TELECOMMUNICATIONS -- 7.3%
37,000 Cable & Wireless plc ............ 402,635
20 Japan Telecom Co. Ltd. .......... 468,099
50 Nippon Telegraph & Telephone Corp. 613,210
15,000 Rogers Communications Inc., Cl. B+ 253,589
10,000 Rogers Communications Inc.,
Cl. B, ADR+ ................... 168,125
16,770 Telefonica SA ................... 268,247
30,000 Telstra Corp. Ltd. .............. 155,524
------------
2,329,429
------------
TRANSPORTATION -- 1.0%
15,637 MIF Ltd. ........................ 302,827
------------
WIRELESS COMMUNICATIONS -- 5.7%
15 NTT Mobile Communications
Network Inc. .................. 294,902
80,000 Telecom Italia Mobile SpA ....... 497,218
4,335 Vodafone AirTouch plc, ADR ...... 1,030,646
------------
1,822,766
------------
TOTAL COMMON STOCKS ............. 31,730,037
------------
OPTIONS -- 0.0%
METALS AND MINING -- 0.0%
16,000 Durban Roodepoort Deep Ltd.+ .... $ 2,266
------------
TOTAL INVESTMENTS -- 99.7%
(Cost $25,939,807) ............ 31,732,303
OTHER ASSETS AND
LIABILITIES (NET)-- 0.3% ...... 81,177
------------
NET ASSETS -- 100.0%
(1,828,198 shares outstanding) $ 31,813,480
============
NET ASSET VALUE,
OFFERING AND REDEMPTION
PRICE PER SHARE ............... $17.40
=======
- ----------------
+ Non-income producing security.
ADR -- American Depositary Receipt.
% OF MARKET
GEOGRAPHIC DIVERSIFICATION MARKET VALUE VALUE
- -------------------------- ------------ -----------
Europe 61.2% $19,416,208
Japan 29.7% 9,413,331
Asia/Pacific Rim 5.1% 1,619,965
North America 2.4% 758,042
South Africa 1.6% 524,757
------ -----------
100.0% $31,732,303
====== ===========
10
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================================================================================
GABELLI FAMILY OF FUNDS
================================================================================
GABELLI ASSET FUND ____________________________________________________________
Seeks to invest primarily in a diversified portfolio of common stocks selling at
significant discounts to their private market value. The Fund's primary
objective is growth of capital.
(NO-LOAD) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI GROWTH FUND ____________________________________________________________
Seeks to invest primarily in large cap stocks believed to have favorable, yet
undervalued, prospects for earnings growth. The Fund's primary objective is
capital appreciation.
(NO-LOAD) PORTFOLIO MANAGER: HOWARD F. WARD, CFA
GABELLI WESTWOOD EQUITY FUND ___________________________________________________
Seeks to invest primarily in the common stock of seasoned companies believed to
have proven records and above average historical earnings growth. The Fund's
primary objective is capital appreciation.
(NO-LOAD) PORTFOLIO MANAGER: SUSAN M. BYRNE
GABELLI SMALL CAP GROWTH FUND _________________________________________________
Seeks to invest primarily in common stock of smaller companies (market
capitalizations less than $500 million) believed to have rapid revenue and
earnings growth potential. The Fund's primary objective is capital appreciation.
(NO-LOAD) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI WESTWOOD SMALLCAP EQUITY FUND _________________________________________
Seeks to invest primarily in smaller capitalization equity securities - market
caps of $1 billion or less. The Fund's primary objective is long-term capital
appreciation.
(NO-LOAD) PORTFOLIO MANAGER: LYNDA CALKIN, CFA
GABELLI WESTWOOD INTERMEDIATE BOND FUND ________________________________________
Seeks to invest in a diversified portfolio of bonds with various maturities. The
Fund's primary objective is total return.
(NO-LOAD) PORTFOLIO MANAGER: PATRICIA FRAZE
GABELLI EQUITY INCOME FUND _____________________________________________________
Seeks to invest primarily in equity securities with above market average yields.
The Fund pays quarterly dividends and seeks a high level of total return with an
emphasis on income.
(NO-LOAD) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI WESTWOOD BALANCED FUND _________________________________________________
Seeks to invest in a balanced and diversified portfolio of stocks and bonds. The
Fund's primary objective is both capital appreciation and current income.
(NO-LOAD) PORTFOLIO MANAGERS: SUSAN M. BYRNE & PATRICIA FRAZE
GABELLI WESTWOOD MIGHTY MITES(SM) FUND _________________________________________
Seeks to invest in micro-cap companies that have market capitalizations of $300
million or less. The Fund's primary objective is long-term capital appreciation.
(NO-LOAD) TEAM MANAGED: MARIO J. GABELLI, CFA, MARC J. GABELLI,
LAURA K. LINEHAN AND WALTER K. WALSH
GABELLI VALUE FUND _____________________________________________________________
Seeks to invest in securities of companies believed to be undervalued. The
Fund's primary objective is long-term capital appreciation.
MAX. SALES CHARGE:51/2% PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI ABC FUND ______________________________________________________________
Seeks to invest in securities with attractive opportunities for appreciation or
investment income. The Fund's primary objective is total return in various
market conditions without excessive risk of capital loss.
(NO-LOAD) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI U.S. TREASURY MONEY MARKET FUND ________________________________________
Seeks to invest exclusively in short-term U.S. Treasury securities. The Fund's
primary objective is to provide high current income consistent with the
preservation of principal and liquidity.
(NO-LOAD) PORTFOLIO MANAGER: JUDITH A. RANERI
THE TREASURER'S FUND ___________________________________________________________
Three money market portfolios designed to generate superior returns without
compromising portfolio safety. U.S. Treasury Money Market seeks to invest in
U.S. Treasury bills, notes and bonds. Tax Exempt Money Market seeks to invest in
municipal securities. Domestic Prime Money Market seeks to invest in prime
quality, domestic money market instruments.
(NO-LOAD) PORTFOLIO MANAGER: JUDITH A. RANERI
AN INVESTMENT IN THE ABOVE MONEY MARKET FUNDS ARE NEITHER INSURED NOR GUARANTEED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY. ALTHOUGH
THE FUNDS SEEK TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT
IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUNDS.
GLOBAL SERIES
GABELLI GLOBAL TELECOMMUNICATIONS FUND
Seeks to invest in telecommunications companies throughout the world -
targeting undervalued companies with strong earnings and cash flow dynamics.
The Fund's primary objective is capital appreciation.
(NO-LOAD) TEAM MANAGER: MARIO J. GABELLI, CFA
GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
Seeks to invest principally in bonds and preferred stocks which are
convertible into common stock of foreign and domestic companies. The Fund's
primary objective is total return through a combination of current income and
capital appreciation.
(NO-LOAD) PORTFOLIO MANAGER: HART WOODSON
GABELLI GLOBAL INTERACTIVE COUCH POTATO(R)FUND
Seeks to invest in securities of companies involved with communications,
creativity and copyright. The Fund also seeks to invest in companies
participating in emerging technological advances in interactive services and
products. The Fund's primary objective is capital appreciation.
(NO-LOAD) PORTFOLIO MANAGER: MARC J. GABELLI
GABELLI GLOBAL OPPORTUNITY FUND
Seeks to invest in common stock of companies which have rapid growth in
revenues and earnings and potential for above average capital appreciation or
are undervalued. The Fund's primary objective is capital appreciation.
(NO-LOAD) PORTFOLIO MANAGERS: MARC J. GABELLI & CAESAR BRYAN
GABELLI GOLD FUND ______________________________________________________________
Seeks to invest in a global portfolio of equity securities of gold mining and
related companies. The Fund's objective is long-term capital appreciation.
Investment in gold stocks is considered speculative and is affected by a variety
of world-wide economic, financial and political factors.
(NO-LOAD) PORTFOLIO MANAGER: CAESAR BRYAN
GABELLI INTERNATIONAL GROWTH FUND ______________________________________________
Seeks to invest in the equity securities of foreign issuers with long-term
capital appreciation potential. The Fund offers investors global
diversification.
(NO-LOAD) PORTFOLIO MANAGER: CAESAR BRYAN
The six funds above invest in foreign securities which involves risks not
ordinarily associated with investments in domestic issues, including currency
fluctuation, economic and political risks.
THE FUNDS LISTED ABOVE ARE DISTRIBUTED BY GABELLI & COMPANY, INC.
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TO RECEIVE A PROSPECTUS, CALL 1-800-GABELLI (422-3554). THE PROSPECTUS GIVES A
MORE COMPLETE DESCRIPTION OF THE FUND, INCLUDING FEES AND EXPENSES. READ THE
PROSPECTUS CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
1-800-GABELLI
(1-800-422-3554) O FAX: 1-914-921-5118 O WWW.GABELLI.COM O [email protected]
ONE CORPORATE CENTER, RYE, NEW YORK 10580
<PAGE>
GABELLI INTERNATIONAL GROWTH FUND, INC.
One Corporate Center
Rye, New York 10580-1434
1-800-GABELLI
[1-800-422-3554]
FAX: 1-914-921-5118
HTTP://WWW.GABELLI.COM
E-MAIL: [email protected]
(Net Asset Value may be obtained daily by calling
1-800-GABELLI after 6:00 P.M.)
BOARD OF DIRECTORS
Mario J. Gabelli, CFA Werner J. Roeder, MD
CHAIRMAN AND CHIEF MEDICAL DIRECTOR
INVESTMENT OFFICER LAWRENCE HOSPITAL
GABELLI ASSET MANAGEMENT INC.
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW MANAGING DIRECTOR
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
Karl Otto Pohl
FORMER PRESIDENT
DEUTSCHE BUNDESBANK
OFFICERS AND PORTFOLIO MANAGERS
Caesar Bryan Bruce N. Alpert
PRESIDENT AND VICE PRESIDENT
PORTFOLIO MANAGER AND TREASURER
James E. McKee
SECRETARY
DISTRIBUTOR
Gabelli & Company, Inc.
CUSTODIAN, TRANSFER AGENT AND DIVIDEND AGENT
State Street Bank and Trust Company
LEGAL COUNSEL
Willkie Farr & Gallagher
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This report is submitted for the general information of the shareholders of
Gabelli International Growth Fund, Inc. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
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GAB009Q399SR
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[PHOTO]
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GABELLI
INTERNATIONAL
GROWTH
FUND,
INC.
THIRD QUARTER REPORT
SEPTEMBER 30, 1999
