<PAGE>
<PAGE>
PRESIDENT'S LETTER
Dear Shareholders:
During the Funds' fiscal period ended April 30, the returns realized by
investors in international markets generally lagged those achieved by U.S.
equity investors. However, we believe the time for opportunities is drawing
nearer. In eight months, Europe will experience an historic event with the
initiation of its unique currency system, and Asia's markets are now near
historically low levels. We believe that the current state of affairs should
translate into increased buying opportunities and should provide international
portfolios with a competitive advantage over holdings selected from an
overvalued U.S. market.
WINTHROP INTERNATIONAL EQUITY FUND
The total return of the Winthrop International Equity Fund for the six months
ending April 30, 1998, was +15.56% (Class A shares) and +15.14% (Class B
shares), versus +15.59% for the Fund's benchmark, the MSCI EAFE Index.
At the onset of the Fund's fiscal year, the Bundesbank of Germany raised
interest rates for the first time in five years and the core European
countries followed suit. Merger and acquisition activity was heavy with no
less than five deals announced on a single day. The European technology sector
was affected by the weak performance of its U.S. counterpart. Fallouts in Asia
and Latin American countries were more volatile with the collapse of the Hong
Kong market triggering the largest fall in the Dow Jones index since the crash
of 1987. European markets reacted similarly at first, but quickly rebounded in
line with the U.S. market.
European markets continued their march upwards during the first quarter of
1998. The positive trend was aided by the fact that the European markets were
less exposed to the situation in Asia than initially expected. Company results
were not surprising and restructuring and mergers continued across the board.
The peripheral markets turned in particularly good performances (Italy, Spain,
Ireland and Finland, as well France) for the first time in years. Germany,
Holland and Switzerland lagged a little behind. Strong performance was seen in
cyclicals (autos, construction, building materials) and in the services sector
(telecoms, insurance and electronics), including Nokia and Ericsson.
We have favored the Italian, Spanish, Finnish and Irish markets and have
progressively built up our French position. We have been neutral on the
British market and have underweighted the Swiss, Dutch and German markets. We
have remained overweighted on capital equipment and services, neutral on
financials and consumer goods and are underweighted in basic materials and
energy.
The Japanese market continues to disappoint as indicators point to the
weakness of the economy. The economic package announced by the government at
the end of March was seen as too little, too late, and the market continued to
slide. Against the background of the Asian currency turmoil and the troubled
Japanese banking sector, the Yen continues to weaken. Cyclical stocks
outperformed at the beginning of the year, but have given up most of their
gains, and the market focus is back on blue-chip exporters. Hong Kong and
are still viewed very cautiously by investors, who believe that the
turmoil of the neighboring countries is not over. The Fund remains
underweighted in the Asian region, including Japan, where we prefer exporters
and non-currency-exposed companies.
WINTHROP DEVELOPING MARKETS FUND
The total return of the Winthrop Developing Markets Fund for the six months
ending April 30, 1998 was +5.88% (Class A shares) and +5.45% (Class B shares)
versus +3.64% for the Fund's benchmark, the MSCI Emerging Markets Free Index.
Emerging markets remain depressed by the Asian crisis. After Thailand's plunge
and the region's steep declines in October, other markets also crashed--South
Korea early in 1998 and Indonesia at the end of March. Investors now believe
the crisis will take longer to work out. Major uncertainties still remain in
countries such as Malaysia, where the situation has been artificially kept
calm. The crisis has also been compounded by the weak Yen as a result of the
slowing of the Japanese economy. Shareholders should note, however, that the
positive case for investing in Asia is real. We believe that market
conditions, amidst short term volatility, show strong growth potential in the
medium to long term due to competitive labor costs, cheaper exports and
continued technological advances. Markets such as Hong Kong, Taiwan and
Singapore are the most likely to stage an early rebound, given strong economic
fundamentals. In addition, policy makers in Thailand appear to have decided to
restructure the economy and it is our belief that if such an effort is
maintained, this country will experience a recovery in the next two years.
The Latin American stock markets contributed significantly to the positive
return of the index during the period. The tight fiscal measures taken by the
Brazilian government at the beginning of the crisis are now paying off and are
having a positive influence on the rest of the region. Eastern Europe is
potentially fragile and its currencies could also be severely affected by the
Asian crisis.
In terms of investment strategy, we continue to prefer quality defensive
stocks, (non-currency-exposed companies with good liquidity) and we are
underweighted significantly in countries such as Indonesia, Malaysia, South
Korea and Russia.
We continue to be very optimistic concerning the long-term potential from
investment in the foreign markets. Thank you for your continued support and
have an enjoyable summer. Sincerely,
G. Moffett Cochran
President June, 1998
<PAGE>
OPPORTUNITY FUND HIGHLIGHTS (unaudited)
Winthrop International Equity Fund
Asset Allocation by Country April 30, 1998
Hong Kong 0.6
Australia 0.6
Singapore 0.3
Malaysia 0.2
Cash & Other Assets/Liabilities 0.1
United Kingdom 25.1
Japan 21.5
Germany 11.0
France 10.6
Switzerland 7.7
Netherlands 6.3
Italy 5.8
Spain 3.3
Sweden 2.8
Finland 1.3
Portugal 1.2
Belgium 0.8
Austria 0.8
Ten Largest Holdings April 30, 1998
Percent of
Country US $ Value Net Assets
--------------- ---------- ----------
CMG Plc ...................... United Kingdom $1,231,869 2.1%
Zeneca Group Plc ............. United Kingdom 1,067,072 1.9
Lloyds TSB Group Plc ......... United Kingdom 1,036,808 1.8
Royal Dutch Petroleum Co. .... Netherlands 1,009,867 1.8
Glaxo Wellcome Plc ........... United Kingdom 1,005,294 1.8
France Telecom SA ............ France 942,126 1.6
Prudential Corporation Plc ... United Kingdom 930,000 1.6
SAP AG ....................... Germany 859,762 1.5
Mannesmann AG ................ Germany 843,122 1.5
Omron Corp ................... Japan 832,324 1.5
---------- ---
$9,758,244 17.1%
========== ====
Investment Results For the Periods Ended April 30, 1998
Average Annual Total Return
----------------------------------------
Winthrop International
Equity Fund
----------------------
Without With MSCI EAFE
Load Load INDEX
-------- ------- ---------
Class A:
1 year ....................... 21.63% 14.64% 19.23%
From inception 9/13/95 ....... 11.14 8.66 11.32
Class B:
1 year ....................... 20.62 16.62 19.23
From inception 9/13/95 ....... 10.31 9.66 11.32
The performance data quoted represents past performance, which is no
indication of future performance. Investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth
more or less than their original cost. No adjustment has been made for any
income taxes payable by shareholders on dividends or capital gains. Class A
returns shown above are computed with and without the imposition of the
maximum 5.75% front-end sales load. Class B shares which, instead of a
front-end sales load, are subject to a contingent deferred sales charge
(CDSC) ranging from 4% during the first year to 0% after 4 years.
Accordingly, returns on Class B shares will differ from those of Class A
shares and are referenced in the table above with and without the
imposition of the applicable CDSC.
The MSCI EAFE is an unmanaged index composed of a sample of companies
representative of the market structure of European and Pacific Basin
countries. The index is the property of Morgan Stanley & Co.
Incorporated. The index does not take into account charges, fees and
other expenses. Further information relating to Fund performance,
including expense reimbursements, if applicable, is contained in the
Financial Highlights section of the Prospectus and elsewhere in this
report.
<PAGE>
OPPORTUNITY FUND HIGHLIGHTS (unaudited)
Winthrop Developing Markets Fund
Asset Allocation by Country April 30, 1998
China 1.1
Cash & Other Assets/Liabilities 0.6
Brazil 22.8
Mexico 13.3
Argentina 10.7
Greece 10.1
South Africa 9.7
Taiwan 6.6
Chile 5.6
India 4.3
Czech Republic 3.5
Thailand 2.6
Hungary 2.1
Hong Kong 2.0
Malaysia 2.0
South Korea 1.5
Philippines 1.5
Ten Largest Holdings April 30, 1998
<TABLE>
<CAPTION>
Percent of
Country US $ Value Net Assets
------------- ---------- ----------
<S> <C> <C> <C>
Telecomunicacoes Brasilerais SA Prf
(Telebras) ...................................... Brazil $1,771,717 5.9%
YPF Sociedad Anonima SA ADR ....................... Argentina 1,114,256 3.7
Centrais Electricas Brasileira SA Prf Cl."B" ...... Brazil 1,086,783 3.6
Telefonica de Argentina SA ADR .................... Argentina 872,592 2.9
Telefonos de Mexico SA Cl."L" ADR ................. Mexico 834,653 2.8
Cifra SA de CV Ser. "V" ........................... Mexico 794,941 2.6
Kimberly-Clark de Mexico
SA de CV Cl."A" ................................. Mexico 705,152 2.3
Hellenic Bottling Company SA ...................... Greece 662,310 2.2
Lojas Americanas SA Prf ........................... Argentina 595,831 2.0
SPT Telecom AS .................................... Czech Republic 557,704 1.9
---------- ----------
$8,995,939 29.9%
========== ==========
</TABLE>
Investment Results For the Periods Ended April 30, 1998
Average Annual Total Return
-------------------------------------
Winthrop Developing
Markets Fund MSCI
-------------------- EMERGING
Without With MARKETS
Load Load FREE INDEX
------ ----- ----------
Class A:
1 year ..................... -9.19% -14.41% -14.53%
From inception 9/13/95 ..... 0.40 -1.84 -1.68
Class B:
1 year ..................... -9.86 -13.47 -14.53
From inception 9/13/95 ..... -0.40 -1.17 -1.68
The performance data quoted represents past performance, which is no
indication of future performance. Investment return and principal value will
fluctuate so that an investor's shares, when redeemed, may be worth more or
less than their original cost. No adjustment has been made for any income
taxes payable by shareholders on dividends or capital gains. Class A returns
shown above are computed with and without the imposition of the maximum 5.75%
front-end sales load. Class B shares which, instead of a front-end sales load,
are subject to a contingent deferred sales charge (CDSC) ranging from 4%
during the first year to 0% after 4 years. Accordingly, returns on Class B
shares will differ from those of Class A shares and are referenced in the
table above with and without the imposition of the applicable CDSC.
The MSCI Emerging Markets Free is an unmanaged index composed of a sample of
companies representative of the market structure of developing countries
worldwide. The index is the property of Morgan Stanley & Co. Incorporated. The
index does not take into account charges, fees and other expenses. Further
information relating to Fund performance, including expense reimbursements, if
applicable, is contained in the Financial Highlights section of the Prospectus
and elsewhere in this report.
<PAGE>
Winthrop Opportunity Funds--Statement of Investments April 30, 1998 (unaudited)
Winthrop International Equity Fund
COMMON STOCKS--99.9%
Shares U.S. $ Value
---------- --------------
AUSTRALIA--0.6%
Coca-Cola Amatil Ltd. ........................ 9,000 $ 68,654
National Australia Bank Ltd. ................. 5,000 71,066
Qantas Airways Ltd. .......................... 41,000 62,551
Telstra Corporation Ltd. ..................... 27,000 63,372
The News Corporation Ltd. .................... 10,000 67,023
-----------
332,666
-----------
AUSTRIA--0.8%
Bank Austria AG .............................. 4,070 314,563
OMV AG ....................................... 1,150 170,660
-----------
485,223
BELGIUM--0.8%
Credit Communal Belgique ..................... 3,420 468,215
-----------
FINLAND--1.3%
Oy Nokia (Ab) Ser 'A' ........................ 11,000 738,975
-----------
FRANCE--10.6%
Accor SA ..................................... 2,220 604,640
Comptoirs Modernes ........................... 900 469,610
Credit Commercial de France .................. 4,900 390,843
Compagnie de Saint Gobain .................... 3,415 568,622
Danone Groupe ................................ 2,497 589,212
Elf Aquitaine SA ............................. 2,962 388,353
France Telecom SA* ........................... 17,322 942,126
Legrand SA ................................... 2,258 596,604
Pernod Ricard ................................ 8,050 555,148
Renault SA ................................... 10,380 481,245
Rhone-Poulenc ................................ 9,839 480,851
-----------
6,067,254
-----------
GERMANY--11.0%
Adidas-Salomon AG ............................ 3,480 575,961
Allianz AG ................................... 1,670 516,030
Allianz AG-New* .............................. 49 15,004
Bayer AG ..................................... 13,780 614,322
Bayerische Motoren Werke AG .................. 620 684,091
Bayerische Vereinsbank AG .................... 7,440 555,565
Commerzbank AG - New* ........................ 13,110 496,785
Daimler Benz AG .............................. 5,790 566,901
Mannesmann AG ................................ 1,070 843,122
SAP AG ....................................... 1,720 859,762
Veba AG ...................................... 8,420 555,078
-----------
6,282,621
HONG KONG--0.6%
Hang Seng Bank Ltd. .......................... 5,400 45,488
Hong Kong & China
Gas Company Ltd. ........................... 29,700 40,451
Hong Kong Telecommunications Ltd. ............ 33,400 62,522
Hutchison Whampoa Ltd. ....................... 13,000 80,389
New World Development
Company Ltd. ............................... 10,500 29,889
Wharf (Holdings) Ltd. ........................ 38,000 60,831
-----------
319,570
-----------
ITALY--5.8%
Alleanza Assicurazioni SPA ................... 32,520 413,852
Autogrill SPA ................................ 34,830 239,807
Banca Intesa SPA ............................. 42,810 241,598
Credito Italiano SPA ......................... 138,070 725,433
Ente Nazionale Idrocarburi SPA ............... 78,890 529,584
Instituto Bancario San Paolo
di Torino SPA .............................. 21,040 303,973
Instituto Nazionale delle
Assicurazioni SPA .......................... 85,060 254,179
Telecom Italia SPA ........................... 115,490 608,751
-----------
3,317,177
-----------
JAPAN--21.5%
Asahi Glass Co. Ltd. ......................... 58,000 313,858
Bank of Tokyo-Mitsubishi Ltd. ................ 36,000 446,560
Bridgestone Corp. Ltd. ....................... 17,000 388,557
Capcom Company Ltd. .......................... 23,800 310,537
Fuji Photo Film Co. Ltd. ..................... 12,000 427,760
Hokuetsu Paper Mills Ltd. .................... 161,000 783,493
Marui Co. Ltd. ............................... 39,000 616,892
Matsushita-Electric Industry Ltd. ............ 17,000 272,762
Matsushita-Kotobuki Electronic Ltd. .......... 15,000 416,635
Mitsubishi Estate Co. Ltd. ................... 33,000 319,685
Mitsui Re Fudosan Ltd. ....................... 45,000 411,413
Mori Seiki Ltd. .............................. 23,000 254,144
NEC Corp. .................................... 18,000 202,982
Nomura Securities Co. Ltd. ................... 35,000 427,798
NTT Corp. .................................... 90 790,131
Omron Corp. .................................. 53,000 832,324
Shin-Etsu Chemical Co. Ltd. .................. 22,000 429,577
Sony Music Entertainment Inc. ................ 5,300 441,633
Sumitomo Bank Ltd. ........................... 8,200 775,751
Sumitomo Electric Industries Ltd. ............ 63,000 751,918
Sumitomo Heavy Industries Ltd. ............... 284,000 681,359
Taisei Corp. ................................. 87,000 197,533
Takashimaya Co. Ltd. ......................... 27,000 194,127
TDK Corp. Ltd. ............................... 4,000 316,658
Terumo Corp. ................................. 26,000 381,352
Tokyo Electron Ltd. .......................... 5,000 196,776
Toyota Motor Corp. Ltd. ...................... 27,000 704,987
-----------
12,287,202
-----------
MALAYSIA--0.2%
Petronas Gas Berhad .......................... 11,000 26,470
Telekom Malaysia Berhad ...................... 12,000 35,936
-----------
62,406
NETHERLANDS--6.3%
Akzo Nobel NV ................................ 2,310 469,885
Hagemeyer NV ................................. 5,812 277,582
ING Groep NV ................................. 12,320 800,596
Royal Dutch Petroleum Co. .................... 18,300 1,009,867
Royal Philips Electronics NV ................. 6,210 547,079
Unilever NV-CVA .............................. 7,140 508,154
-----------
3,613,163
-----------
PORTUGAL--1.2%
Banco Espirito Santo e
Comercial de Lisboa, SA .................... 8,320 398,021
Portugal Telecom SA .......................... 5,740 308,453
-----------
706,474
-----------
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Statement of Investments April 30, 1998 (continued)
Winthrop International Equity Fund
Shares U.S. $ Value
---------- --------------
SINGAPORE--0.3%
Fraser & Neave Ltd. .......................... 6,000 $ 26,903
Singapore Airlines Ltd. ...................... 4,000 26,018
Singapore Telecommunications Ltd. ............ 24,000 41,225
-----------
94,146
-----------
SPAIN--3.3%
Autopistas del Mare Nostrum SA ............... 9,480 186,596
Banco Cenral Hispanoamericano SA ............. 1,840 61,207
Banco Santander SA ........................... 10,350 546,649
Cortefiel SA ................................. 7,760 183,798
Endesa SA .................................... 28,400 689,433
Grupo Acciona SA ............................. 1,010 227,228
-----------
1,894,911
-----------
SWEDEN--2.8%
Astra AB-A SA ................................ 24,216 497,537
Electrolux AB ................................ 5,860 545,200
Telefonaktiebolaget LM Ericsson SA ........... 10,980 578,880
-----------
1,621,617
-----------
SWITZERLAND--7.7%
Alusuisse Lonza Group AG ..................... 190 243,210
Credit Suisse Holding AG ..................... 2,220 488,419
Nestle SA .................................... 370 717,829
Novartis A - Reg. Shares ..................... 390 644,826
Reiter Holding Ltd. .......................... 290 174,200
Roche Holding AG ............................. 66 669,047
Schindler Holding AG ......................... 120 194,008
Schweizerischer Bankverein ................... 1,020 354,294
Sulzer AG .................................... 190 136,172
UBS - Union Bank of
Switzerland Ltd. ........................... 230 370,468
Zurich Versicherungs -
Gesellschaft AG ............................ 680 414,363
-----------
4,406,836
-----------
UNITED KINGDOM--25.1%
Abbey National Plc ........................... 37,577 $699,284
Alliance & Leicester Plc ..................... 17,750 249,592
Bank of Ireland Plc .......................... 23,450 477,166
Bank of Scotland Plc ......................... 65,090 809,155
Barclays Plc ................................. 25,600 734,931
British Aerospace Plc ........................ 9,910 332,053
British Petroleum Co. Plc .................... 14,240 224,879
CMG Plc ...................................... 27,620 1,231,869
Glaxo Wellcome Plc ........................... 35,535 1,005,294
HSBC Holdings Plc ............................ 14,380 452,256
Lloyds TSB Group Plc ......................... 69,092 1,036,808
Marks & Spencer Plc .......................... 80,050 761,570
Misys Plc .................................... 16,800 803,362
National Power Plc ........................... 29,910 290,804
Norwich Union Plc* ........................... 46,020 344,522
Prudential Corporation Plc ................... 65,592 930,000
Reed International Plc ....................... 62,050 548,306
Royal & Sun Alliance
Insurance Group Plc ........................ 64,590 718,163
Smithkline Beecham ........................... 68,862 824,958
Vodafone Group Plc ........................... 71,420 786,343
Zeneca Group Plc ............................. 24,660 1,067,072
-----------
14,328,387
-----------
TOTAL INVESTMENTS--99.9%
(cost $48,179,598) ........................... 57,026,843
-----------
Cash and Other Assets
Net of Liabilities--0.1% ..................... 81,365
-----------
NET ASSETS--100% ............................. $57,108,208
===========
* Non- income producing
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Statement of Investments April 30, 1998 (unaudited)
Winthrop Developing Markets Fund
COMMON STOCKS--76.6%
Shares U.S. $ Value
---------- --------------
ARGENTINA--10.7%
Banco Frances SA ............................. 4,600 $ 43,705
Banco de Galicia y Buenos Aires SA ........... 16,340 95,603
IRSA Inversiones
y Representaciones SA ...................... 91,000 348,208
Perez Compane SA ............................. 80,091 479,802
Siderca SA Cl 'A' ............................ 104,148 253,111
Telefonica de Argentina SA ADR ............... 22,628 872,592
YPF Sociedad Anonima SA ADR .................. 31,950 1,114,256
-----------
3,207,277
-----------
CHILE--5.6%
Cia Cervecerias Unidas
SA ADR ..................................... 7,770 214,646
Cia de Telecomunicaciones de
Chile SA ADR ............................... 15,315 383,832
Empresa Nacional Electricidad
SA ADR ..................................... 26,280 458,258
Enersis SA ADR ............................... 7,870 231,673
Gener SA ..................................... 4,645 103,932
Madeco GDR ................................... 2,308 36,928
Quimica Minera Chile SA ADR .................. 5,980 259,756
-----------
1,689,025
-----------
CHINA--1.1%
Beijing Yanhua Retrochemical
Company Ltd.* .............................. 17,920 145,600
Huaneng Power International, Inc.* ........... 8,500 187,000
-----------
332,600
-----------
CZECH REPUBLIC--3.5%
Ceske Energeticke Zavody AS* ................. 5,721 171,974
Inzenyrske Prumyslove Stavby* ................ 2,850 18,209
Komercni Banka AS ............................ 1,240 41,500
Skoda Plzen AS* .............................. 3,851 40,188
SPT Telecom AS* .............................. 3,834 557,704
Tabak AS ..................................... 869 228,702
-----------
1,058,277
-----------
GREECE--10.1%
Aktor SA ..................................... 2,700 20,608
Alpha Credit Bank SA ......................... 5,250 553,575
Attica Enterprises ........................... 19,560 326,575
Attica Enterprises Rts ....................... 3,912 3,583
Elais SA ..................................... 1,700 56,767
Ergo Bank SA ................................. 1,798 169,253
Hellas Can Packaging SA ...................... 1,000 16,394
Hellenic Bottling Company SA ................. 17,800 662,310
Hellenic Telecommunication
Organization SA ............................ 5,250 150,265
National Bank of Greece ...................... 3,080 541,665
Silver & Baryte Ores Mining SA ............... 1,100 46,036
Titan Cement Company SA ...................... 5,800 496,176
-----------
3,043,207
-----------
HONG KONG--2.0%
Beijing Datang Power
Generation Co. Ltd.* ....................... 352,000 143,144
China Eastern Airlines Ltd.* ................. 1,477,000 $ 169,703
Guangdong Kelon Electric
Holdings Co. Ltd. .......................... 186,000 190,897
Tsingtao Brewery Co. Ltd.* ................... 452,000 88,112
-----------
591,856
-----------
HUNGARY--2.1%
Gedeon Richter Rt ............................ 460 50,600
Magyar Tavkozlesi Rt.* ....................... 7,000 206,500
Mol Magyar Olaj GDR .......................... 12,000 366,300
-----------
623,400
-----------
INDIA--4.3%
Crompton Greaves Ltd. GDR .................... 34,200 63,270
Eith Limited GDR*............................. 10,300 119,094
Grasim Industries Ltd. GDR.................... 9,400 84,600
Indian Aluminum co. Ltd. GDR*................. 40,000 110,000
Mahindra & Mahindra Ltd. GDR*................. 11,800 87,910
Ranbaxy Laboratories GDR...................... 8,100 194,400
State Bank of India GDR....................... 17,900 332,045
Tata Engineering and
Locomotive Co. Ltd. GDR..................... 26,400 192,060
Videsh sanchar GDR*........................... 7,700 95,287
-----------
1,278,666
-----------
MALAYSIA--2.0%
AMMB Holdings Bhd
Warrant Exp. 05/13/02*...................... 2,700 412
Ekran Bhd Warrants*........................... 15,000 2,406
Genting Bhd................................... 20,200 66,972
Malayan Banking Bhd........................... 27,100 79,706
Petronas Gas Bhd.............................. 37,000 89,037
Rothmans of Pall Mall Bhd..................... 8,000 65,775
Telecom Malaysia Bhd.......................... 61,500 184,171
Tenaga Nasional Bhd........................... 30,400 60,556
YTL Corporation Bhd........................... 40,000 62,032
-----------
611,067
-----------
MEXICO--13.3%
Cifra SA de CV Ser. 'V'....................... 455,992 794,941
Empresa La Moderna SA
de CV ADR*.................................. 1,000 20,062
Grupo Carso SA de CV Ser. 'A1'*............... 76,130 472,588
Grupo Eledta SA de CV......................... 54,180 77,860
Grupo Industrial Bimbo SA de CV............... 107,860 283,958
Grupo Mexico SA de CV Ser. 'B'................ 169,530 522,197
Grupo Modelo SA de CV Cl 'C'.................. 11,320 106,673
Kimberly-Clark de Mexico SA
de CV Cl 'A' ............................... 146,010 705,152
Telefonos de Mexico
SA Cl. 'L' ADR ............................. 14,740 834,653
Tubos de Acero de Mexico SA* ................. 7,800 142,411
Vitro SA Cl. 'A' ............................. 9,750 36,406
-----------
3,996,901
-----------
See notes to financial statements
<PAGE>
Winthrop Opportunity Funds--Statement of Investments April 30, 1998 (continued)
Winthrop Developing Markets Fund
Shares U.S. $ Value
---------- --------------
PHILIPPINES--1.5%
Manila Electric Company Cl.'B' ............... 46,600 $ 132,314
Philippine Long Distance
Telephone Co. .............................. 7,900 211,519
SM Prime Holdings, Inc. GDR .................. 13,100 117,900
-----------
461,733
-----------
SOUTH AFRICA--9.7%
Anglo American Corp. ......................... 4,800 283,832
Barlow Ltd. .................................. 14,200 137,183
De Beers Centenary AG ........................ 13,375 346,508
Free State Consolidated
Gold Mines Ltd. ............................ 8,400 51,581
Liberty Life Association of
Africa Ltd. ................................ 8,275 279,842
Metro Cash & Carry Ltd. ...................... 243,044 269,167
Nedcor Ltd. .................................. 9,814 279,484
Pick' N Pay Stores Ltd. ...................... 72,100 136,885
Rembrandt Group Ltd. ......................... 31,700 288,380
Sasol Ltd. ................................... 36,078 363,882
South African Breweries Ltd. ................. 14,640 491,038
-----------
2,927,782
-----------
SOUTH KOREA--1.5%
Korea Electrical Power ADR ................... 16,008 149,075
Pohang Iron ADR .............................. 8,436 150,266
Samsung Electronics GDR ...................... 5,792 150,592
Samsung Electronics - SP GDR N/V* ............ 314 3,595
-----------
453,528
-----------
TAIWAN--6.6%
Cathay Construction Corp. .................... 274,600 254,826
Cathay Life Insurance Co. Ltd. ............... 36,950 147,914
Evergreen Marine Corp. ....................... 119,000 119,092
Far Eastern Textile Ltd. ..................... 258,823 235,475
Formosa Chemicals & Fibre Corp. .............. 101,975 105,146
Hon Hai Precision Industry* .................. 76,000 442,523
Hua Nan Commercial Bank ...................... 44,100 106,992
International Commercial Bank
of China ................................... 88,000 128,100
Microtek International, Inc.* ................ 117,100 166,908
Pacific Electrical Wire
& Cable Corp.* ............................. 203,600 191,408
U-Ming Marine Transport Corp. ................ 162,100 81,604
Yang Ming Marine Transport ................... 6,000 3,967
-----------
1,983,955
-----------
THAILAND--2.6%
Bangkok Bank Public Co. Ltd. ................. 103,600 259,837
Banpu Public Co. Ltd. ........................ 29,100 $ 200,144
PTT Exploration and Production
Public Co. Ltd.* ........................... 15,500 162,244
TelecomAsia Corporation
Public Co. Ltd.* ........................... 410,600 148,633
-----------
770,858
-----------
Total Common Stocks
(cost $21,000,778) ........................... 23,030,132
-----------
PREFERRED STOCKS--22.8%
BRAZIL--22.8%
Banco Bradesco SA Prf ........................ 9,823,040 90,158
Banco Itau SA Prf ............................ 435,000 288,981
Centrais Electricas Brasileiras
SA Prf Cl.'B' .............................. 24,871,000 1,086,783
Companhia Brasileira de Petroleo
Ipiranga SA Prf ............................ 35,000,000 454,321
Companhia Paulista de
Forca e Luz SA Prf* ........................ 3,831,000 495,611
Companhia Siderurgica
Nacional SA Prf ............................ 8,845,000 271,376
Companhia Vale do Rio
Doce SA Prf ................................ 19,238 464,126
Ericsson Telecomucacoes SA Prf ............... 15,038,000 403,548
Lojas Americanas SA Prf ...................... 75,738,000 595,831
Lojas Renner SA Prf .......................... 6,670,000 262,364
Perdigao SA Prf .............................. 231,212,000 383,997
Petrobras Distribuidora SA Prf ............... 1,964,000 33,477
Petroleo Brasileiro SA Prf ................... 950,000 $ 238,326
Telecomunicacoes Brasileiras
SA Prf (Telebras ) ......................... 14,742,000 1,771,717
-----------
6,840,616
-----------
Total Preferred Stocks
(cost $4,772,020) ............................ 6,840,616
-----------
TOTAL INVESTMENTS--99.4%
(cost $25,772,798) ........................... 29,870,748
-----------
Cash and Other Assets
Net of Liabilities--0.6% ..................... 186,048
-----------
NET ASSETS--100% ............................. $30,056,796
===========
* Non-income producing
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Statement of Assets and Liabilities April 30, 1998
(unaudited)
<TABLE>
<CAPTION>
International Developing
Equity Fund Markets Fund
------------ ------------
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $48,179,598 and $25,772,798, respectively) ............ $ 57,026,843 $ 29,870,748
Cash, at value (cost $24,761 and $244,708, respectively) ...... 24,788 244,736
Receivable for capital stock sold ............................. 41,704 2,000
Dividends and interest receivable ............................. 252,754 135,598
Deferred organization costs (Note A) .......................... 47,994 47,994
------------ ------------
Total assets ............................................... 57,394,083 30,301,076
------------ ------------
LIABILITIES:
Payable to investment advisor ................................. 65,655 15,594
Payable for securities purchased .............................. 106,507 153,946
Payable for capital stock redeemed ............................ -- 2,000
Accrued expenses and other liabilities ........................ 113,713 72,740
------------ ------------
Total liabilities .......................................... 285,875 244,280
------------ ------------
NET ASSETS ....................................................... $ 57,108,208 $ 30,056,796
============ ============
NET ASSETS CONSIST OF:
Capital paid-in ............................................... $ 44,564,599 $ 30,883,293
Accumulated net investment loss ............................... (1,015,689) (223,344)
Accumulated net realized gain (loss) on investments and
foreign currency transactions ............................... 4,719,452 (4,700,705)
Net unrealized appreciation of investments and foreign currency
denominated assets and liabilities .......................... 8,839,846 4,097,552
------------ ------------
$ 57,108,208 $ 30,056,796
============ ============
CLASS A SHARES:
Net assets .................................................... $ 49,659,010 $ 25,356,054
------------ ------------
Shares outstanding ............................................ 3,811,105 2,515,999
------------ ------------
Net asset value and redemption value per share ................ $ 13.03 $ 10.08
============ ============
Maximum offering price per share (net asset value plus
sales charge of 5.75% of offering price) .................... $ 13.83 $ 10.69
============ ============
CLASS B SHARES:
Net assets .................................................... $ 7,449,198 $ 4,700,742
------------ ------------
Shares outstanding ............................................ 580,026 476,367
------------ ------------
Net asset value and offering price per share .................. $ 12.84 $ 9.87
============ ============
</TABLE>
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Statement of Operations for the period ended April
30, 1998*
<TABLE>
<CAPTION>
International Developing
Equity Fund Markets Fund
----------- -----------
<S> <C> <C>
INVESTMENT INCOME:
Dividend income ............................................................................. $ 329,895 $ 337,937
Interest income ............................................................................. 40,947 16,552
----------- -----------
370,842 354,489
Less withholding tax on foreign source dividends ......................................... (44,558) (30,031)
----------- -----------
Total investment income .................................................................. 326,284 324,458
----------- -----------
EXPENSES:
Investment advisory fees (Note B) ........................................................... 333,062 189,839
Distribution fees--Class A (Note B) ......................................................... 57,938 32,115
Distribution fees--Class B (Note B) ......................................................... 34,696 23,411
Legal fees .................................................................................. 16,000 9,000
Transfer agent fees ......................................................................... 49,000 39,500
Custodian fees .............................................................................. 66,000 60,500
Auditing fees ............................................................................... 16,000 12,000
Printing fees ............................................................................... 15,000 10,000
Trustees' fees .............................................................................. 7,000 4,000
Registration fees ........................................................................... 37,000 24,000
Miscellaneous ............................................................................... 8,931 3,004
Amortization of organization costs (Note A) ................................................. 11,267 11,267
----------- -----------
651,894 418,636
Less fees waived by investment advisor
and subadvisor (Note B) ............................................................... (53,004) (74,555)
----------- -----------
Net expenses ............................................................................. 598,890 344,081
----------- -----------
NET INVESTMENT LOSS ............................................................................ (272,606) (19,623)
----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS--Note C:
Net realized gain (loss) on investments ..................................................... 4,910,971 (1,380,126)
Net realized gain (loss) on foreign currency transactions ................................... (103,287) (28,638)
Net change in unrealized appreciation on investments ........................................ 3,261,656 3,118,041
Net change in unrealized appreciation on translation of foreign currency
denominated assets and liabilities ........................................................ (12,937) 2,266
----------- -----------
Net realized and unrealized gain on investments and foreign currency
transactions .............................................................................. 8,056,403 1,711,543
----------- -----------
INCREASE IN NET ASSETS FROM OPERATIONS ......................................................... $ 7,783,797 $ 1,691,920
=========== ===========
</TABLE>
*Unaudited
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Statement of Changes in Net Assets
<TABLE>
<CAPTION>
International Equity Fund Developing Markets Fund
------------------------- -----------------------
Six Months Year Ended Six Months Year Ended
Ended 04/30/98* 10/31/97 Ended 04/30/98* 10/31/97
--------------- -------- --------------- --------
<S> <C> <C> <C> <C>
OPERATIONS:
Net investment loss ............................. $ (272,606) $ (332,309) $ (19,623) $ (145,488)
Net realized gain (loss) on investments and
foreign currency transactions ................. 4,807,684 914,894 (1,408,764) (3,238,751)
Net change in unrealized appreciation/
depreciation on investments and foreign
currency denominated assets and liabilities ... 3,248,719 3,559,351 3,120,307 1,884,963
------------ ------------ ------------ ------------
Increase (decrease) in net assets resulting
from operations ............................... 7,783,797 4,141,936 1,691,920 (1,499,276)
------------ ------------ ------------ ------------
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Investment income:
Class A ....................................... (212,893) -- -- --
Class B ....................................... -- -- -- --
Realized gains on investments:
Class A ....................................... (333,161) -- -- (87,147)
Class B ....................................... (51,942) -- -- (9,498)
------------ ------------ ------------ ------------
Total dividends and distributions to shareholders (597,996) -- -- (96,645)
------------ ------------ ------------ ------------
CAPITAL STOCK TRANSACTIONS--(NET)
Note D .......................................... (1,214,167) (130,060) (5,977,739) (4,621,133)
Total increase (decrease) in net assets ........ 5,971,634 4,011,876 (4,285,819) (6,217,054)
NET ASSETS:
Beginning of year ............................... 51,136,574 47,124,698 34,342,615 40,559,669
------------ ------------ ------------ ------------
End of period ................................... $ 57,108,208 $ 51,136,574 $ 30,056,796 $ 34,342,615
------------ ------------ ------------ ------------
</TABLE>
* Unaudited
See notes to financial statements.
<PAGE>
Winthrop Opportunity Funds--Notes to Financial Statements April 30, 1998
(unaudited)
Note (A) Significant Accounting Policies. Winthrop International Funds ("Fund"
or "Funds") consists of two portfolios (the "Portfolios"), the Winthrop
International Equity Fund and the Winthrop Developing Markets Fund (together
the "International Funds"), each a separate diversified series of the Winthrop
Opportunity Funds (the "Trust"). In addition, the Trust also consists of the
Winthrop Municipal Money Fund and the Winthrop U.S. Government Money Fund. The
Trust was organized as a Delaware business trust under the laws of Delaware on
May 31, 1995 and is registered under the Investment Company Act of 1940 (the
"Act"), as amended, as an open-end investment company.
The investment objective of the Developing Markets Fund is long-term growth of
capital by investing primarily in common stocks and other equity securities
from developing countries. The International Equity Fund seeks long-term
growth of capital by investing primarily in common stocks and other equity
securities from established markets outside the United States.
Each Portfolio offers two classes of shares. Class A shares are sold with a
front-end sales charge of up to 5.75%. Class B shares are sold with a
contingent deferred sales charge which declines from 4% to zero depending on
the period of time the shares are held. Both classes have identical voting,
dividend, liquidation and other rights, except that each class bears different
distribution expenses and has exclusive voting rights with respect to its
distribution plan. Wood, Struthers & Winthrop Management Corp. (the "Advisor")
is a wholly-owned subsidiary of Donaldson, Lufkin and Jenrette Securities
Corporation, which is wholly-owned subsidiary of Donaldson, Lufkin and
Jenrette, Inc. ("DLJ"). DLJ is an independently operated, indirect subsidiary
of The Equitable Companies, Incorporated, a holding company controlled by AXA
- - UAP ("AXA"), a member of a large French insurance group. AXA is indirectly
controlled by a group of four French mutual insurance companies. The Advisor
has retained AXA Asset Management Partenaires as subadvisor to the Funds (the
"Subadvisor").
The Funds account separately for the assets, liabilities and operations of
each Portfolio. Expenses directly attributable to each Portfolio are charges
to that Portfolio's operations: expenses which are applicable to all
portfolios 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. The following is a summary
of significant accounting policies consistently followed by the Funds.
(1) Security Valuation: All securities for which current market
quotations are readily available are valued at the last sale price prior
to the time of determination, or, if there is no sales price on such
date, and if bid and ask quotations are available, at the mean between
the last current bid and asked prices. Securities that are traded
over-the-counter, if bid and asked quotations are available, are valued
at the mean between the current bid and asked prices, or, if quotations
are not available, are valued as determined in good faith by the Board
of Trustees of the Fund. Short-term investments having a maturity of 60
days or less are valued at amortized cost. Securities and assets for
which current market quotations are not readily available are valued at
fair value as determined in good faith by the Board of Trustees of the
Fund.
(2) Foreign Currency Translations: Investment securities and other
assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the bid prices of such currencies against the U.S.
dollar as of the date of valuation. Purchases and sales of portfolio
securities, commitments under forward foreign currency contracts, income
receipts and expense accruals are translated at the prevailing exchange
rate on the date of each transaction.
The Fund does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held.
Such fluctuations are included with the net realized and unrealized gain
or loss from investments.
<PAGE>
Winthrop Opportunity Funds--Notes to Financial Statements April 30, 1998
(continued)
Reported net realized gain (loss) on foreign currency transactions arise
from sales and maturities of short-term securities, sales of foreign
currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, the difference between the
amounts 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 change in unrealized appreciation on
translation of foreign currency denominated assets and liabilities
arises from changes in the value of assets and liabilities other than
investments in securities at fiscal year end, resulting from changes in
exchange rates.
(3) Federal Income Taxes: The Funds intend to be treated as "regulated
investment companies" under Sub-chapter M of the Internal Revenue Code
and to distribute substantially all of their net taxable income.
Accordingly, no provisions for Federal income or excise taxes have been
made in the accompanying financial statements. The Developing Markets
Fund has an unused capital loss carryover of approximately $3,185,000
available for Federal income tax purposes to be applied against future
net securities profits, if any, realized subsequent to October 31, 1997.
If not applied, the carryover expires in fiscal 2005.
(4) Investment Income and Securities Transactions: Dividend income is
recorded on the ex-dividend date or as soon as the Fund is informed of
the dividend. Interest income is accrued daily. Security transactions
are accounted for on the date securities are purchased or sold. Security
gains and losses are determined on the identified cost basis.
(5) Dividends and Distributions: Dividends and distributions to
shareholders are recorded on the ex-dividend date. Income dividends and
capital gain distributions are determined in accordance with income tax
regulations, which may differ from generally accepted accounting
principles.
(6) Deferred Organization Costs: The Funds will reimburse the Advisor
for costs incurred in connection with the Fund's organization. The costs
are being amortized on a straight-line basis over five years commencing
with the Fund's operation.
Note (B) Advisory and Distribution Services Agreement: Under the terms of an
Advisory Agreement with the Advisor, for the investment management services
furnished to each Portfolio, such Portfolio will pay the Advisor an advisory
fee, on a graduated basis at an annual rate of 1.25% of the first $100 million
of average daily net assets, 1.15% of the next $100 million and 1% of average
daily net assets over $200 million. Such fee will be accrued daily and paid
monthly. Under a Subadvisory Agreement between the Advisor and Subadvisor, the
Advisor pays the Subadvisor for its services, out of the Advisor's own
resources, at the following annual percentage rates of the average daily net
assets of each Portfolio: .625 of 1% of each Portfolio's first $100 million,
.575 of 1% of the next $100 million and .50 of 1% of the balance.
Commencing at the inception of each Fund through April 30, 1998, the Advisor
and Subadvisor voluntarily reduced their management fees by the amount that
total fund operating expenses exceeded 2.15% and 2.90% of the average daily
net assets of the Class A and Class B shares, respectively, of each Fund. Any
such reduction has or will be borne equally between the Advisor and
Subadvisor. For the period May 1, 1998 through October 31, 1998, the Advisor
and Subadvisor have agreed to continue to voluntarily reduce their management
fees by the amount that total fund operating expenses exceed 2.15% and 2.90%
of the average daily net assets of the Class A and Class B shares,
respectively, of each Fund. After October 31, 1998, the Advisor and Subadvisor
may, in their sole discretion, determine to discontinue this practice with
respect to either Fund. As a result of the voluntary waiver, the Advisor and
Subadvisor waived fees amounting to $53,004 and $74,555 for the International
Equity Fund and Developing Markets Fund, respectively, during the six month
period ended April 30, 1998.
<PAGE>
Winthrop Opportunity Funds--Notes to Financial Statements April 30, 1998
(continued)
The Fund has entered into a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940 for Class A
and Class B shares with Donaldson, Lufkin & Jenrette Securities Corporation,
the Fund's Distributor. Under the Agreement, each Portfolio will pay a
distribution services fee to the Distributor at an annual rate of up to .25 of
1% of the average daily net assets attributable to Class A shares and 1% of
the average daily net assets attributable to Class B shares. The fees are
accrued daily and paid monthly. The Agreement provides that the Distributor
will use such payments in their entirety for distribution assistance and
promotional activities. The Agreement also provides that the Advisor may use
its own resources to finance the distribution of the Fund's shares.
Each Trustee who is not an affiliated person receives an attendance fee of
$2,000 per meeting. In addition, each unaffiliated Trustee receives an
attendance fee of $1,000 per audit committee meeting. Attendance fees are
charged to all series of the Trust and are allocated on a pro rata basis.
Note (C) Investment Transactions: Purchases and sales of investment securities
(excluding short-term securities and forward currency exchange contracts)
during the six month period ended April 30, 1998, aggregated $27,142,476 and
$24,797,610 for the International Equity Fund; and $9,617,059 and $14,156,129
for the Developing Markets Fund, respectively.
The Funds may enter into forward exchange currency contracts in order to hedge
exposure to changes in foreign currency exchange rates on their foreign
portfolio holdings. A forward exchange currency contract is a commitment to
purchase or sell a foreign currency at a future date at a negotiated forward
rate. The gain or loss arising from the difference between the original
contracts and the closing of such contracts is included in net realized gain
or loss from foreign currency transactions.
Fluctuations in the value of forward exchange currency contracts are recorded
for financial reporting purposes as net change in unrealized appreciation
(depreciation) of foreign currency denominated assets and liabilities. Risks
may arise from the potential inability of a counterparty to meet the terms of
a contract and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar.
At April 30, 1998, the cost of investments for federal income tax purposes was
substantially the same as the cost for financial reporting purposes. At April
30, 1998, the components of net unrealized appreciation (depreciation) of
investments were as follows:
<TABLE>
<CAPTION>
International Developing
Equity Fund Markets Fund
----------- ------------
<S> <C> <C>
Gross appreciation (investments having an excess of value over cost) ........ $ 11,717,596 $ 6,647,526
Gross depreciation (investments having an excess of cost over value) ........ (2,870,351) (2,549,576)
------------ ------------
Net unrealized appreciation of investments .................................. $ 8,847,245 $ 4,097,950
============ ============
</TABLE>
<PAGE>
NOTE (D) Shares of Beneficial Interest: There is an unlimited number of shares
($0.001 par value) of beneficial interest authorized, divided into two
classes, designated Class A and Class B shares. Transactions in shares of
beneficial interest were as follows:
<TABLE>
<CAPTION>
International Equity Fund
------------------------------------------------------------
Six Months Ended Year Ended
April 30, 1998* October 31, 1997
---------------------------- ----------------------------
Shares Amount Shares Amount
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Class A
Shares sold ............... 89,284 $ 1,047,001 822,555 $ 9,553,450
Shares issued through
reinvestment of
dividends ............... 48,974 540,052 -- --
Shares redeemed ........... (207,998) (2,495,784) (1,005,538) (11,086,992)
------------ ------------ ------------ ------------
Net decrease .............. (69,740) $ (908,731) (182,983) $ (1,533,542)
============ ============ ============ ============
Class B
Shares sold ............... 57,979 $ 696,714 201,057 $ 2,251,556
Shares issued through
reinvestment of
dividends ............... 4,788 51,706 -- --
Shares redeemed ........... (89,431) (1,053,856) (75,755) (848,074)
------------ ------------ ------------ ------------
Net increase (decrease) ... (26,664) $ (305,436) 125,302 $ 1,403,482
============ ============ ============ ============
<CAPTION>
Developing Markets Fund
------------------------------------------------------------
Six Months Ended Year Ended
April 30, 1998* October 31, 1997
---------------------------- ----------------------------
Shares Amount Shares Amount
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Class A
Shares sold ............... 104,643 $ 990,653 352,037 $ 3,898,784
Shares issued through
reinvestment of
dividends ............... -- -- 8,374 84,414
Shares redeemed ........... (675,683) (6,475,045) (981,711) (10,394,319)
------------ ------------ ------------ ------------
Net decrease .............. (571,040) $ (5,484,392) (621,300) $ (6,411,121)
============ ============ ============ ============
Class B
Shares sold ............... 35,496 $ 335,118 218,192 $ 2,441,467
Shares issued through
reinvestment of
dividends ............... -- -- 950 9,486
Shares redeemed ........... (86,847) (828,465) (60,685) (660,965)
------------ ------------ ------------ ------------
Net increase (decrease) ... (51,351) $ (493,347) 158,457 $ 1,789,988
============ ============ ============ ============
</TABLE>
* Unaudited
<PAGE>
FINANCIAL HIGHLIGHTS
The table below sets forth financial data for a share of capital stock
outstanding throughout each period presented. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
Net
Realized and
Unrealized
Gains or Ratio of
(Losses) on Distri- Net Ratio of Net
Net Asset Net Investments Dividends butions Asset Net Assets Expenses Investment
Value, Investment and Foreign from Net from Value, End of to Average Income (Loss) Portfolio
Beginning Income/ Currency Investment Capital End Total Period Net to Average Turnover
of Period (Loss)(1) Transactions Income Gains of Period Return(2) (000 omitted) Assets(4) Net Assets(4) Rate
--------- --------- ------------ ------ ----- --------- --------- ------------- --------- ------------- ----
International Equity Fund
Class A
Six Months Ended April 30, (unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998 $11.42 ($0.06) $1.82 ($0.06) ($0.09) $13.03 15.56% $49,659 2.15%(3) (0.92)%(3) 46.95%
<CAPTION>
Years Ended October 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1997 10.38 (0.07) 1.11 -- -- 11.42 10.02 44,316 2.15 (0.59) 73.92
1996 9.58 (0.04) 0.84 -- -- 10.38 8.35 42,170 2.15 (0.39) 94.12
1995* 10.00 -- (0.42) -- -- 9.58 (4.20) 28,819 2.15(3) (0.02)(3) 0.00
Class B
<CAPTION>
Six Months Ended April 30, (unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998 11.24 (0.10) 1.79 -- (0.09) 12.84 15.14 7,449 2.90(3) (1.69)(3) 46.95
<CAPTION>
Years Ended October 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1997 10.29 (0.15) 1.10 -- -- 11.24 9.23 6,821 2.90 (1.32) 73.92
1996 9.57 (0.13) 0.85 -- -- 10.29 7.52 4,955 2.90 (1.25) 94.12
1995* 10.00 (0.02) (0.41) -- -- 9.57 (4.30) 1,803 2.90(3) (1.77)(3) 0.00
<CAPTION>
Developing Markets Fund
Class A
Six Months Ended April 30, (unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998 $ 9.52 -- $0.56 -- -- $10.08 5.88% $25,356 2.15%(3) (0.02)%(3) 32.25%
<CAPTION>
Years Ended October 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1997 9.96 ($0.02) (0.40) -- ($0.02) 9.52 (4.18) 29,402 2.15 (0.17) 52.79
1996 9.53 (0.01) 0.44 -- -- 9.96 4.51 36,918 2.15 (0.14) 26.76
1995* 10.00 -- (0.47) -- -- 9.53 (4.70) 14,622 2.15(3) 0.32 (3) 0.00
Class B
<CAPTION>
Six Months Ended April 30, (unaudited)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1998 9.36 (0.02) 0.53 -- -- 9.87 5.45 4,701 2.90(3) (0.75)(3) 32.25
<CAPTION>
Years Ended October 31,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1997 9.86 (0.19) (0.29) -- (0.02) 9.36 (4.83) 4,941 2.90 (1.74) 52.79
1996 9.52 (0.08) 0.42 -- -- 9.86 3.57 3,641 2.90 (0.83) 26.76
1995* 10.00 (0.01) (0.47) -- -- 9.52 (4.80) 1,004 2.90(3) (1.00)(3) 0.00
</TABLE>
* Commencement of operations was September 8, 1995.
(1)Based on average shares outstanding
(2)Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of all dividends
and distributions at net asset value during the period, and redemption on
the last day of the period. Initial sales charge or contingent deferred
sales charge is not reflected in the calculation of total return. Total
return calculated for a period of less than one year is not annualized.
(3)Annualized
(4)Net of voluntary reduction of management fees by Adviser and Subadviser
expressed as a percentage of average daily net assets of both Class A and
Class B shares of each Fund as follows: International Equity Fund .20%
(annualized) for the six months ended April 30, 1998, and .18%, .27% and
.60% for the years ended 10/31/97, 96 and 95, respectively, and Developing
Markets Fund .49% (annualized) for the six months ended April 30, 1998, and
.34%, .54% and .60% for the years ended 10/31/97, 96 and 95, respectively.
<PAGE>
WINTHROP OPPORTUNITY FUNDS
(800) 225-8011
TRUSTEES
G. MOFFETT COCHRAN ROBERT E. FISCHER
WILMOT H. KIDD, III MARTIN JAFFE
JOHN W. WALLER, III
OFFICERS
G. MOFFETT COCHRAN, Chairman and President
JAMES A. ENGLE, Vice President
MARTIN JAFFE, VICE PRESIDENT, Secretary and Treasurer
BRIAN A. KAMMERER, Vice President
INVESTMENT ADVISER
WOOD STRUTHERS & WINTHROP MANAGEMENT CORP.
An Investment Management Subsidiary of
Donaldson, Lufkin & Jenrette
277 Park Avenue, New York, NY 10172
SUBADVISER
AXA ASSET MANAGEMENT
Partenaires
46, avenue de la Grande Armee
Paris, France 75017
CUSTODIAN
CITIBANK, N.A.
111 Wall Street, New York, NY 10043
TRANSFER AGENT
FIRST DATA INVESTOR SERVICES GROUP, INC.
P.O. Box 61503 (3200 Horizon Drive)
King of Prussia, PA 19406
DISTRIBUTOR
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
277 Park Avenue, New York, NY 10172
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue, New York, NY 10019
LEGAL COUNSEL
SKADDEN, ARPS, SLATE, MEAGHER &FLOM
919 Third Avenue, New York, NY10022
This report is submitted for the general information of the stockholders of
the Fund. It is not authorized for distribution to prospective investors in
the Fund unless preceded or accompanied by an
effective prospectus, which should be
read carefully before investing.
WOOD, STRUTHERS & WINTHROP
ESTABLISHED 1871
INVESTMENT MANAGEMENT SUBSIDIARY OF
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
(THE FUND DISTRIBUTOR)
WOF-2
[WINTHROP MUTUAL FUNDS LOGO]
WINTHROP DEVELOPING MARKETS FUND
WINTHROP INTERNATIONAL EQUITY FUND
APRIL 30, 1998
SEMI-ANNUAL
REPORT
