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Delaware
Investments(SM)
---------------------------------------
A member of Lincoln Financial Group(R)
[Closed End Artwork]
CLOSED-END
Semiannual Report
2002
DELAWARE INVESTMENTS
Global Dividend and Income Fund, Inc.
[LOGO] POWERED BY RESEARCH.(SM)
<PAGE>
Table
of Contents
Letter to Shareholders 1
Portfolio Management Review 3
Performance Summary 6
Financial Statements:
Statement of Net Assets 7
Statement of Operations 13
Statements of Changes
in Net Assets 14
Statement of Cash Flows 15
Financial Highlights 16
Notes to Financial Statements 17
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested.
Mutual fund advisory services provided by Delaware International Advisers Ltd.,
which is a registered investment advisor.
(C) Delaware Distributors, L.P.
<PAGE>
Your Fund's Investment Strategies
A Tradition of Sound Investing Since 1929
U.S. Common Stocks with Above-Average Yields
The Fund's management focuses on stocks that pay high dividends relative to
their share price. Such high yields can point the Fund to strong companies whose
stocks have capital appreciation potential. The dividend income from these
stocks has the potential to add value to total return.
Convertible Preferred Stocks and Bonds
The Fund invests in both convertible preferred stocks and convertible bonds.
Both securities pay fixed rates of income, but because they can be converted
into common stock, they are indirectly tied to the common stock's performance.
As a result, convertible securities generally offer higher income than common
stocks and an opportunity for price appreciation when the value of the
underlying common stock rises. The Fund may buy convertibles when the underlying
common stock offers strong growth potential but a lower yield.
High-Yield Corporate Bonds
High-yield bonds, those rated BB or lower, have greater default risk than bonds
with higher quality ratings, but provide a greater level of income to compensate
investors for the additional risk. Prices of high-yield bonds tend to be less
sensitive to changes in interest rates than higher rated bonds.
Foreign Stocks
In evaluating foreign stocks, the Fund's management takes into account risks
that include a country's inflation outlook, economy, politics, different
accounting standards, tax policies, and the effect of currency fluctuations. The
value of a company's projected dividend stream is "discounted" for these risks
so that management has a consistent yardstick to compare stocks around the
globe.
Foreign Bonds
The Fund invests in foreign government and corporate bonds whose total return
potential relative to currency, political and economic risks, appears
attractive. In order to reduce currency risk, the Fund may buy foreign bonds
denominated in U.S. dollars rather than the currency of the country issuing the
bond.
Leveraging
About $21 million (30.50%) of your Fund's total net assets were leveraged as of
May 31, 2002. Leveraging is a tool that is generally not available to open-end
mutual funds and one that can be an important contributor to your Fund's income
and capital appreciation. Of course, there is no guarantee that the Fund will
achieve its objective by using leveraging. Leveraging could result in a higher
degree of volatility because the Fund's net asset value could be more sensitive
to fluctuations in short-term interest rates and equity prices. We believe this
risk is reasonable given the potential benefits of higher income.
Your Fund's Buyback Program
Your Fund's board of directors approved a share repurchase program in 1994 that
authorizes Delaware Investments Global Dividend and Income Fund, Inc. to
purchase up to 10% of its outstanding shares on the floor of the New York Stock
Exchange. During the six-month period ended May 31, 2002, we did not make use of
this option since we did not see this as the most effective way to add value to
the portfolio.
Your Reinvestment Options
Delaware Investments Global Dividend and Income Fund, Inc. offers an automatic
dividend reinvestment program. If you would like to reinvest dividends, and
shares are registered in your name, contact Mellon Investor Services, LLC at 800
851-9677. You will be asked to put your request in writing. If you have shares
registered in "street" name, contact the broker/dealer holding the shares or
your financial advisor.
<PAGE>
Letter
to Shareholders
Delaware Investments Global Dividend and Income Fund, Inc.
June 11, 2002
Recap of Events
During the six months ended May 31, 2002, the U.S. economy showed signs of
renewed strength after a brief and mild recession that appeared to end in
November.
In the first quarter of 2002, the U.S. economy grew by an annualized rate of
+6.1% as measured by the gross domestic product (GDP). However, unemployment
rates continued to rise, peaking at a 7 1/2 year high of 6% in April. Meanwhile,
corporations struggled to resume steady and strong sales and earnings growth.
The Federal Reserve's aggressive interest rate cuts (11 reductions to the fed
funds rate throughout 2001) are beginning to take effect. It can take nine
months or longer for interest rate reductions to be felt throughout the economy.
However, the effects have yet to be reflected in rising corporate profits or
renewed investor confidence. Complicating things is the skepticism investors
have displayed regarding corporate accounting practices in the aftermath of the
Enron meltdown and discouraging revelations elsewhere. Clearly, it will take
time to shake off the negativity surrounding market news coming out of this very
difficult period.
Delaware Investments Global Dividend and Income Fund, Inc. returned +9.21% (at
net asset value with distributions reinvested) for the six-month period ended
May 31, 2002. The Fund outperformed the +0.93% gain by the Morgan Stanley
Capital International (MSCI) Europe, Australia, and Southeast Asia (EASEA) Index
during the period. It also strongly outperformed the +2.01% gain of its peer
group, the Lipper Closed-End Income and Preferred Stock Funds Average.
Market Outlook
We continue to expect price volatility, as investors remain skeptical in the
wake of the Enron collapse and other corporate accounting and reporting
uncertainties. Investors will need compelling reasons to begin buying and
holding stocks again, which may happen naturally once corporations begin
reporting profit growth amidst the economic recovery.
Barring an energy crisis or a worsening of the situation in the Middle East, we
think investors could see strong earnings improvements in the second half of
2002, within the context of a fairly modest economic recovery. Ultimately, we
expect that steady economic growth, low inflation, low interest rates and high
levels of productivity will lead to improved profitability in the coming months.
Due to the modest expected rate of economic recovery, we do not expect to see
any fed funds rate increases for at least several months.
<TABLE>
<CAPTION>
Total Return
Premium(+) /
At Net Asset Value Discount (-)
For the period ended May 31, 2002 Six Months As of 5/31/02
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Delaware Investments Global Dividend and Income Fund, Inc. +9.21% +14.78%
Standard & Poor's 500 Index -5.67%
Merrill Lynch High-Yield Bond Index +2.29%
Morgan Stanley Capital International (MSCI)
Europe, Australia, and Southeast Asia (EASEA) Index +0.93%
Salomon Smith Barney Non-U.S. World Government Bond Index +4.79%
Lipper Closed-End Income and Preferred Stock Funds Average (11 funds) +2.01%
------------------------------------------------------------------------------------------------------------
</TABLE>
All performance shown above is at net asset value and assumes reinvestment of
all distributions. Performance information at market price and net asset value
can be found on page 6. The S&P 500 Index is an unmanaged composite of
large-capitalization U.S. companies. The Merrill Lynch High-Yield Bond Index
measures the performance of the U.S. high-yield bond market. The Morgan Stanley
Capital International (MSCI) Europe, Australia, and Southeast Asia (EASEA) Index
measures the performance of stocks in Europe, Australia, and Southeast Asia,
excluding Japan. The Salomon Smith Barney Non-U.S. World Government Bond Index
measures the general performance of non-U.S. bond markets. All indexes are
unmanaged. The Lipper Closed-End Income and Preferred Stock Funds Average
represents the average return of income and preferred stock closed-end funds
tracked by Lipper (Source: Lipper Inc.). You cannot invest directly in an index.
Past performance is not a guarantee of future results.
1
<PAGE>
Overall, we see plenty of investment opportunities beginning to unfold. We
expect that long-term investors will continue to benefit from the broad
diversification and income-oriented investment style that Delaware Investments
Global Dividend and Income Fund, Inc. offers. Thank you for your continued
confidence in, and commitment to, Delaware Investments.
Sincerely,
/s/ Charles E. Haldeman, Jr.
-------------------------------------
Charles E. Haldeman, Jr.
Chairman,
Delaware Investments Family of Funds
/s/ David K. Downes
--------------------------------------
David K. Downes
President and Chief Executive Officer,
Delaware Investments Family of Funds
2
<PAGE>
Portfolio
Management Review
Delaware Investments Global Dividend and Income Fund, Inc.
June 11, 2002
Fund Managers
Peter C. Andersen
Senior Portfolio Manger
U.S. Fixed Income
Delaware Management Company
Damon J. Andres
Senior Portfolio Manager
U.S. Equities
Delaware Management Company
Nancy M. Crouse
Senior Portfolio Manager
U.S. Equities
Delaware Management Company
Joanna Bates
Senior Portfolio Manager
Foreign Fixed Income
Delaware Investment Advisers Ltd.
Clive A. Gillmore
Senior Portfolio Manager
Foreign Equities
Delaware Investment Advisers Ltd.
Christopher A. Moth
Senior Portfolio Manager
Foreign Fixed-Income
Delaware Investment Advisers Ltd.
The Fund's Results
In late 2001, investors worldwide were grappling with the effects of recessions
in the U.S. and Europe, as well as continued market volatility. By March 2002,
signs of economic strengthening began to emerge in the U.S., aided in part by
low interest rates and strong consumer spending.
While an economic recovery is under way in the U.S., the recovery appears more
subdued than normal. Meanwhile, legal and accounting issues surrounding several
high profile U.S. corporations have plagued investor confidence in recent
months. For the six months ended May 31, 2002, the S&P 500 Index fell by -5.67%.
As 2002 progressed into spring, non-U.S. equity performance, as measured by the
Morgan Stanley Capital International (MSCI) Europe, Australia, and Southeast
Asia (EASEA) Index, improved dramatically as major euro zone economies began to
record stronger output. This market strength carried through to the end of May,
so that during the Fund's first half of its fiscal year the MSCI EASEA Index
gained +0.93% (all non-U.S. returns are quoted in U.S. dollars).
Despite the challenges of global markets where performance could be called
"mixed" at best, Delaware Investments Global Dividend and Income Fund, Inc.
enjoyed gains for the six months ended May 31, 2002. During this period, your
Fund posted a +9.21% return (at net asset value with distributions reinvested).
Positive total return performance in the bond market contributed to the Fund's
strong performance. For the period, both the Salomon Smith Barney Non-U.S. World
Government Bond Index (+4.79%) and the Merrill Lynch High-Yield Bond Index
(+2.29%) posted net gains.
Portfolio Highlights
In our pursuit of income generated by investments from around the world, we have
kept your Fund widely diversified. As always, the portfolio included both stock
and bond investments from the U.S. and foreign markets. The Fund had 42.10% of
its net assets in non-U.S. investments as of May 31, 2002, and the investment
portfolio had been expanded to include 274 different securities in total -- an
increase over recent periods that was a consequence of volatility in many world
markets. We believe that diversification generally helped the Fund during the
period.
U.S. Stocks
Though the anticipated rebound of cyclical stocks didn't meet our expectations
during the period, some of the cyclical stocks that we held performed relatively
well. Forest products leader Weyerhaeuser generated attractive returns following
completion of its acquisition of Willamette Industries. Within Weyerhaeuser's
core business, price increases have begun to surface due to a disciplined
capacity shutdown.
The Fund also continues to have a significant allocation to real estate
investment trusts (REITs), which have performed well for more than two years
running. As a group, REITs were among the portfolio's best performers again
during the six-month period. REITs offer steady, reliable income, which make
them a natural investment for a Fund looking to deliver consistent cash flow to
shareholders.
3
<PAGE>
Our holdings in the capital goods sectors of the economy -- which included
Caterpillar, Emerson Electric, and Deere & Company (better known as John Deere)
-- also generated strong returns. We believe that a recently approved U.S. farm
bill enabling farmers to increase equipment spending is likely to benefit
companies such as John Deere.
We also began increasing our positions in consumer growth areas, specifically
large pharmaceutical companies. While we experienced disappointments among
pharmaceutical holdings during the period, we believe this sector offers
long-term value. A number of issues have negatively impacted drug companies
recently, including patent expirations, a decline in new product rollouts, and
competition from generic drugs amid demand for lower healthcare costs. Despite
these issues, we feel demographics favor this industry strongly, and will
continue to capitalize on select opportunities such as Bristol-Myers Squibb,
Abbott Laboratories, and Schering-Plough, which we feel offer compelling
valuations and strong balance sheets.
Foreign Stocks
The collapse of Enron in the U.S. had little direct impact on international
equity markets. Nonetheless, the debate that has been initiated on appropriate
accounting practices has led to some sharp share price reactions in companies
with poor transparency and a history of aggressive accounting practices. As
investors in international equity markets, we have been very cognizant of the
drawbacks to certain accounting practices used in various markets. Varying
practices, in our view, highlight the need for detailed country and sector
knowledge, rigorous fundamental analysis and an investment methodology that is
applicable in all countries.
Most of our strategies with regard to the investment portfolio remained in place
during the past six months. Within the foreign stock section of the portfolio,
we continue to hold a heavier weighting than the MSCI EASEA Index in the U.K.
and are generally attracted to the banking, finance, and insurance sector, where
we hold HBOS, Lloyds TSB Group, and ING Groep NV of the Netherlands. Many of our
top non-U.S. equity holdings at period end were names that have been in the
portfolio for some time, including GlaxoSmithKline, Boots, Foster's Brewing
Group, and France's Societe Generale, among others.
High-Yield Bonds
Our high-yield bond allocation was a positive contributor to performance during
the period, as the market for non-investment grade debt has improved over recent
periods. Despite poor performance among many cable issues stemming from
Adelphia's much-publicized troubles, the sector (cable, media, and publishing in
the Fund's Statement of Net Assets) remains a large part of high-yield bond
indexes. We remain bullish on some cable-related companies, such as Charter
Communications, and feel that the yields in the sector are attractive.
We continued to focus on companies whose business models and balance sheets are
easily understood. With the SEC and ratings agencies further scrutinizing
complex accounting practices, we believe these types of companies are easier to
analyze and are generally free from "inquiry risk." We also focused on
securities rated B or higher by Moody's or Standard & Poor's during the period,
and expect to continue to do so going forward.
4
<PAGE>
Foreign Bonds
Government bond markets seem to be anticipating a global economic recovery.
Long-term yields rose sharply in the last several months of our six-month period
(except in Japan), reversing the price gains made in the second half of 2001. We
continue to believe Australia and New Zealand show the best value based on
prospective real yields. Growth in both economies looks set to remain strong
during the remainder of 2002, and we expect rapid productivity growth to subdue
inflation. We believe euro zone government bonds also offer good value. We
believe that underlying inflation in the euro zone should fall in 2002, as spare
capacity should lead to slower wage growth. Japan and the U.S. remain poorly
valued markets in our opinion, although we are attracted to U.S. index-linked
bonds.
Outlook
We believe it could take time for the global economic picture to brighten fully,
but are confident that Delaware Investments Global Dividend and Income Fund,
Inc. is well positioned to generate attractive income and returns going forward.
We will maintain a cautious approach and avoid making heavy sector bets or
reaching too strongly for high yields in search of market outperformance. It is
our belief that companies with strong cash flows and an emphasis on fundamentals
will be the best performers over the long term. We believe our reliance on
bottom-up, individual security selection helps us uncover reasonable valuations
and offers investors a portfolio with broad diversification, attractive income,
and low volatility.
Delaware Investments Global Dividend and
Income Fund, Inc.
Top 10 Country Allocations
As of May 31, 2002
United States 57.90%
------------------------------------------------------------
United Kingdom 6.65%
---------
Australia 5.98%
---------
Germany 5.22%
------
New Zealand 4.22%
-----
South Africa 4.03%
----
France 2.62%
----
Mexico 2.50%
----
Poland 2.09%
---
Greece 1.84%
--
------------------------------------------------------------->
0% 60%
5
<PAGE>
Delaware Investments
Global Dividend and Income Fund, Inc.
Fund Basics
As of May 31, 2002
--------------------------------------------------------------------------------
Fund Objective:
The Fund seeks to achieve high current income and, secondarily, capital
appreciation.
--------------------------------------------------------------------------------
Total Fund Net Assets:
$68.86 million
--------------------------------------------------------------------------------
Number of Holdings:
274
--------------------------------------------------------------------------------
Fund Start Date:
March 4, 1994
Fund Performance
Average Annual Total Returns
Through May 31, 2002 Lifetime Five Years One Year
--------------------------------------------------------------------------------
At Market Price +9.43% +6.81% +16.14%
At Net Asset Value +8.43% +4.25% +5.04%
Returns reflect reinvestment of all distributions. Shares of the Fund were
initially offered with a sales charge of 6.0%. Performance since inception does
not include the sales charge or any brokerage commissions for purchases made
since inception. Past performance is not a guarantee of future results.
The performance table and graphs on the following page do not reflect the
deductions of taxes the shareholder would pay of Fund distributions or
redemptions of Fund shares.
--------------------------------------------------------------------------------
Your Fund Managers:
Peter C. Andersen received a Master's degree in finance from Harvard University
and a Master's degree in physics from Yale University. Prior to joining Delaware
Investments in 2000, Mr. Andersen was a portfolio manager at Conseco Capital
Management, where he managed high-yield portfolios for both institutional and
retail products. Mr. Andersen is a CFA charterholder.
Damon J. Andres earned a bachelor's degree in Business Administration with an
emphasis in finance and accounting from the University of Richmond. Prior to
joining Delaware Investments in 1994, Mr. Andres performed investment consulting
services with Cambridge Associates, Inc. in Arlington, Virginia. He is also
co-manager of Delaware REIT Fund.
Nancy M. Crouse began her career in finance at Philadelphia National Bank.
Before joining Delaware in 1993, she served as Vice President at CoreStates
Investment Advisers, where she performed securities analysis and managed
balanced portfolios. Ms. Crouse is a CFA charterholder.
Joanna Bates is a graduate of London University, and is an associate of the
Institute of Investment Management and Research. She joined Delaware's Fixed
Income team in 1997, before which she was Associate Director, Fixed Interest at
Hill Samuel Investment Management Ltd. She has also worked for Fidelity
International and Save & Prosper as a fund manager and analyst for global bond
markets.
Clive A. Gillmore is a graduate of the University of Warwick. Mr. Gillmore
joined Delaware in 1990 after serving in the investment management field for
eight years. He previously was Senior Portfolio Manager at Hill Samuel
Investment Management Ltd.
Christopher A. Moth is an actuarial graduate from The City University in London,
and was later awarded the Certificate in Finance & Investment from the London
Institute of Actuaries. Mr. Moth joined Delaware in 1992, after working for the
GRE insurance company where he was responsible for quantitative models and
projections.
--------------------------------------------------------------------------------
NYSE Symbol:
DGF
Market Price vs. Net Asset Value
May 31, 2001 to May 31, 2002
Delaware Investments Global Dividend and Income Fund, Inc.
Delaware Delaware
Investments Investments
Global Global
Dividend and Dividend and
Income Fund, Income Fund,
Inc -- Market Price Inc -- NAV
------------------------------------------------------------
May '01 $12.90 $12.23
Jun '01 $12.83 $11.93
Jul '01 $12.95 $12.01
Aug '01 $13.15 $12.05
Sept '01 $10.85 $10.90
Oct '01 $11.87 $10.79
Nov '01 $12.40 $11.17
Dec '01 $11.85 $11.09
Jan '02 $12.30 $10.96
Feb '02 $12.30 $10.92
Mar '02 $12.60 $11.24
Apr '02 $12.85 $11.30
May '02 $13.20 $11.50
Past performance is not a guarantee of future results.
6
<PAGE>
Statement
of Net Assets
Delaware Investments Global Dividend and Income Fund, Inc.
May 31, 2002 (Unaudited)
Number of Market
Shares Value (U.S.$)
Common Stock - 70.03%
Automobiles & Automotive Parts - 2.99%
Continental 26,000 $ 471,236
Ford Motor 38,667 682,472
General Motors 10,200 633,930
GKN 56,000 274,487
----------
2,062,125
----------
Banking, Finance & Insurance - 10.20%
Banco Santander Central Hispano 3,237 29,909
Bank of America 12,100 917,301
Bayerische Hypo-und Vereinsbank AG 7,800 274,726
Gladstone Capital 47,800 889,080
HBOS 32,000 385,101
ING Groep NV 21,489 568,354
IntesaBci 108,500 321,331
J.P. Morgan Chase 22,200 798,090
Lloyds TSB Group 38,600 417,934
Mellon Financial 10,600 393,260
National Australia Bank 25,119 514,429
Sanlam 303,000 272,348
Societe Generale Class A 6,650 451,978
Wells Fargo 15,100 791,240
----------
7,025,081
----------
Building & Materials - 1.59%
Compagnie de Saint Gobain 3,200 568,024
CSR 45,172 168,248
Wharf Holdings 153,000 360,930
----------
1,097,202
----------
Chemicals - 3.56%
Air Products & Chemicals 15,300 767,295
Bayer 16,433 534,268
Dow Chemical 25,500 850,170
Orica 56,800 296,760
----------
2,448,493
----------
Computers & Technology - 0.84%
Pitney Bowes 14,100 577,395
----------
577,395
----------
Consumer Products - 2.07%
Kimberly-Clark 10,000 649,200
Procter & Gamble 8,700 779,085
----------
1,428,285
----------
Electronics & Electrical Equipment - 0.84%
Emerson Electric 10,000 578,500
----------
578,500
----------
Energy - 4.98%
ChevronTexaco 8,300 724,176
Conoco Class B 21,000 564,480
Kerr-McGee 11,600 673,844
Royal Dutch Petroleum 11,700 654,750
RWE 11,000 417,236
Sasol 35,307 392,896
----------
3,427,382
----------
<PAGE>
Number of Market
Shares Value (U.S.$)
Common Stock (continued)
Food, Beverage & Tobacco - 6.02%
Anheuser-Busch 14,400 $ 743,184
Foster's Brewing Group 205,142 543,445
Goodman Fielder 742,076 684,685
Heinz (H.J.) 22,000 893,860
PepsiCo 14,200 738,116
RJ Reynolds Tobacco Holdings 1 71
Six Continents 48,528 540,338
----------
4,143,699
----------
Healthcare & Pharmaceuticals - 4.39%
Abbott Laboratories 12,500 593,750
Biomet 15,900 448,857
Bristol-Myers Squibb 22,500 700,200
GlaxoSmithKline 22,792 468,208
Merck & Company 10,400 593,840
Schering-Plough 8,200 216,890
----------
3,021,745
----------
Industrial Machinery - 1.96%
Brambles Industries 56,000 269,161
Caterpillar 11,000 574,970
Deere & Company 10,700 502,900
----------
1,347,031
----------
Metals & Mining - 0.57%
Rio Tinto 20,523 392,769
----------
392,769
----------
Paper & Forest Products - 3.14%
Amcor 111,800 572,724
Carter Holt Harvey 63,274 60,913
International Paper 16,400 706,840
Paperlinx 19,765 58,849
Weyerhaeuser 11,600 759,800
----------
2,159,126
----------
Real Estate - 12.71%
AMB Property 18,300 533,445
Apartment Investment & Management 11,100 517,038
Camden Property Trust 10,000 384,000
Capital Automotive 15,400 368,830
Chateau Communities 18,100 545,715
Duke Realty 26,000 703,560
FBR Asset Investment 9,600 327,840
+Host Marriott 75,000 860,999
Liberty Property Trust 21,042 725,949
Macerich 18,000 513,900
Meristar Hospitality 20,100 321,600
Pan Pacific Retail Properties 17,600 557,568
Prentiss Properties Trust 21,308 682,921
Ramco-Gershenson Properties 18,400 361,560
Reckson Associates Realty 28,100 706,715
Simon Property Group 8,000 272,560
Sun Communities 9,000 369,720
----------
8,753,920
----------
7
<PAGE>
Statement
of Net Assets (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
Number of Market
Shares Value (U.S.$)
Common Stock (continued)
Retail - 2.61%
Boots 55,874 $ 559,593
GUS 56,051 531,431
Sears Roebuck & Company 12,000 708,600
-----------
1,799,624
-----------
Telecommunications - 2.30%
BellSouth 12,000 399,360
Cable & Wireless 50,300 154,369
Telecom Corporation of New Zealand 189,000 466,186
Verizon Communications 13,054 561,322
-----------
1,581,237
-----------
Textiles, Apparel & Furniture - 1.11%
Newell Rubbermaid 22,300 761,545
-----------
761,545
-----------
Transportation & Shipping - 1.70%
British Airways 93,000 276,908
Union Pacific 10,000 612,401
West Japan Railway 63 283,260
-----------
1,172,569
-----------
Utilities - 6.45%
BG 121,754 528,198
Electrabel 1,689 372,396
Hong Kong Electric 142,000 551,626
Iberdrola 38,396 534,485
Powergen 51,389 577,458
Scottish Power ADR 26,100 594,036
+Telefonica 32,830 347,508
Telstra 100,953 270,293
TXU 13,000 667,290
-----------
4,443,290
-----------
Total Common Stock (cost $45,590,695) 48,221,018
-----------
Convertible Preferred Stock - 6.75%
Aerospace & Defense - 0.73%
Northrop Grumman 7.25% 3,850 500,423
-----------
500,423
-----------
Banking, Finance & Insurance - 2.47%
Equity Securities Trust I 6.50% 13,500 302,940
Sovereign Capital Trust II 7.50% 13,000 1,104,350
Travelers Property Casualty 4.50% 12,000 293,400
-----------
1,700,690
-----------
Paper & Forest Products - 0.94%
Georgia-Pacific PEPS Units 7.50% 22,500 648,000
-----------
648,000
-----------
Real Estate - 1.73%
General Growth Properties 7.25% 38,700 1,190,025
-----------
1,190,025
-----------
<PAGE>
Number of Market
Shares Value (U.S.$)
Convertible Preferred Stock (continued)
Transportation & Shipping - 0.88%
Union Pacific Capital Trust
TIDES 144A 6.25% 12,000 $ 609,000
-----------
609,000
-----------
Total Convertible Preferred Stock
(cost $4,445,375) 4,648,138
-----------
Preferred Stocks - 0.92%
Real Estate - 0.92%
LaSalle Hotel Properties 10.25% 23,500 629,800
-----------
629,800
-----------
Telecommunications - 0.00%
Intermedia Communications PIK 13.50% 1 275
-----------
275
-----------
Total Preferred Stocks (cost $588,063) 630,075
-----------
Principal
Amount++
Convertible Bonds - 4.00%
Automobiles & Automotive Parts - 1.26%
MascoTech 4.50% 12/15/03 USD 900,000 868,500
-----------
868,500
-----------
Banking, Finance & Insurance - 0.59%
Verizon Global Funding 144A
5.75% 4/1/03 400,000 406,000
-----------
406,000
-----------
Computers & Technology - 0.34%
Mercury Interactive 144A
4.75% 7/1/07 275,000 234,781
-----------
234,781
-----------
Retail - 0.84%
Gap 144A 5.75% 3/15/09 500,000 576,875
-----------
576,875
-----------
Transportation & Shipping - 0.97%
Continental Airlines 4.50% 2/1/07 750,000 671,250
-----------
671,250
-----------
Total Convertible Bonds
(cost $2,665,250) 2,757,406
-----------
8
<PAGE>
Statement
of Net Assets (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds - 44.14%
Aerospace & Defense - 0.11%
BE Aerospace 9.50% 11/1/08 USD 45,000 $ 43,650
Sequa 9.00% 8/1/09 30,000 30,450
----------
74,100
----------
Automobiles & Automotive Parts - 0.40%
Advance Stores 10.25% 4/15/08 25,000 26,688
Asbury Auto Group 144A
9.00% 6/15/12 100,000 99,999
Collins & Aikman Products 144A
10.75% 12/31/11 50,000 52,563
Neff 10.25% 6/1/08 50,000 31,500
Venture Holdings Trust
12.00% 6/1/09 95,000 65,075
----------
275,825
----------
Banking, Finance & Insurance - 1.60%
Asat Finance 12.50% 11/1/06 91,000 76,895
Depfa Deutsche Pfandbriefbank
AG 5.50% 1/15/10 EUR 500,000 471,697
Fairfax Financial Holdings
7.75% 12/15/03 USD 110,000 105,733
Finova Group 7.50% 11/15/09 230,000 82,800
Midland Funding II Series A
11.75% 7/23/05 150,000 158,771
Orion Power Holdings
12.00% 5/1/10 75,000 69,375
Sovereign Bancorp
10.50% 11/15/06 60,000 66,900
Von Hoffman Press 144A
10.25% 3/15/09 30,000 31,313
Western Financial Bank
9.625% 5/15/12 40,000 40,600
----------
1,104,084
----------
Building & Materials - 0.41%
Ainsworth Lumber
13.875% 7/15/07 15,000 16,913
Albecca 10.75% 8/15/08 50,000 55,813
Beazer Homes USA 8.625% 5/15/11 60,000 62,550
DR Horton
9.75% 9/15/10 45,000 48,150
10.00% 4/15/06 30,000 30,975
Encompass Services
10.50% 5/1/09 110,000 65,449
----------
279,850
----------
<PAGE>
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds (continued)
Cable, Media & Publishing - 1.22%
Charter Communications Holdings
10.00% 4/1/09 USD 325,000 $ 294,124
*144A 12.99% 1/15/12 155,000 77,888
Coaxial Communications of Central
Ohio 10.00% 8/15/06 110,000 110,549
CSC Holdings
9.875% 2/15/13 45,000 44,888
10.50% 5/15/16 50,000 51,000
Lodgenet Entertainment 10.25% 12/15/06 125,000 126,874
Mediacom Broadband 11.00% 7/15/13 50,000 51,125
Paxson Communications 10.75% 7/15/08 45,000 48,938
WRC Media 12.75% 11/15/09 35,000 36,663
---------
842,049
---------
Chemicals - 0.77%
Avecia Group 11.00% 7/1/09 55,000 55,688
Huntsman International
10.125% 7/1/09 70,000 65,538
144A 9.875% 3/1/09 30,000 30,900
IMC Global 6.55% 1/15/05 65,000 62,803
Lyondell Chemical Series B
9.875% 5/1/07 60,000 58,950
MacDermid 9.125% 7/15/11 75,000 80,250
Solutia
6.50% 10/15/02 110,000 104,258
6.72% 10/15/37 85,000 73,816
---------
532,203
---------
Computers & Technology - 0.24%
Chippac International 12.75% 8/1/09 100,000 109,500
Seagate Technology 144A
8.00% 5/15/09 55,000 55,688
---------
165,188
---------
Consumer Products - 0.67%
American Greetings 11.75% 7/15/08 70,000 76,300
Fedders North America
9.375% 8/15/07 250,000 175,938
Salton 12.25% 4/15/08 75,000 79,875
Service International 6.30% 3/15/03 75,000 74,250
Stewart Enterprises 10.75% 7/1/08 50,000 55,750
---------
462,113
---------
Energy - 0.63%
Compton Petroleum 144A 9.90% 5/15/09 65,000 66,300
Denbury Management 9.00% 3/1/08 30,000 30,150
El Paso Energy Partners 8.50% 6/1/11 80,000 81,600
Grant Prideco 9.625% 12/1/07 50,000 52,875
Swift Energy 9.375% 5/1/12 40,000 39,900
Vintage Petroleum
7.875% 5/15/11 55,000 50,875
9.00% 12/15/05 45,000 45,675
144A 8.25% 5/1/12 65,000 64,350
---------
431,725
---------
9
<PAGE>
Statement
of Net Assets (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds (continued)
Environmental Services - 0.23%
Allied Waste North America
8.875% 4/1/08 USD 125,000 $ 128,438
Synagro Technologies 144A
9.50% 4/1/09 30,000 31,050
-----------
159,488
-----------
Food, Beverage & Tobacco - 1.08%
Advantica Restaurant Group
11.25% 1/15/08 150,000 117,750
B&G Foods 144A 9.625% 8/1/07 60,000 62,175
CKE Restaurants 9.125% 5/1/09 150,000 146,999
Constellation Brands 8.125% 1/15/12 75,000 77,156
Di Giorgio Series B 10.00% 6/15/07 115,000 118,019
Fleming 144A 9.875% 5/1/12 65,000 66,300
Ingles Markets 8.875% 12/1/11 50,000 51,250
Marsh Supermarkets 8.875% 8/1/07 100,000 100,750
Perkins Family Restaurants
10.125% 12/15/07 5,000 5,031
-----------
745,430
-----------
Foreign Government - 28.66%
Belgium Government Bond
5.75% 9/28/10 EUR 1,200,000 1,160,002
Deutsche Bundesrepublik
5.00% 7/4/11 350,000 323,443
6.00% 1/5/06 1,200,000 1,171,213
6.25% 1/4/24 1,000,000 1,019,173
France Government Bond O.A.T.
5.50% 4/25/10 1,000,000 957,046
Hellenic Republic Government Bond
8.60% 3/26/08 750,000 822,642
8.70% 4/8/05 800,000 829,871
Italy Government International Bond
5.75% 7/25/16 500,000 474,016
New South Wales Treasury
6.50% 5/1/06 AUD 2,000,000 1,144,710
New Zealand Government Bond
6.00% 11/15/11 NZD 3,000,000 1,359,001
7.00% 7/15/09 2,000,000 970,893
8.00% 4/15/04 1,900,000 933,385
Poland Government Bond
8.50% 2/12/05 PLZ 5,500,000 1,359,257
12.00% 10/12/03 2,000,000 513,779
Queensland Treasury
6.00% 7/14/09 AUD 2,000,000 1,114,372
Republic of Austria
4.00% 7/15/09 EUR 450,000 390,984
Republic of South Africa
Series 153 13.00% 8/31/10 ZAR 16,000,000 1,733,803
Series 177 9.50% 5/15/07 13,000,000 1,218,854
United Mexican States Global
7.375% 7/6/06 EUR 1,000,000 976,022
8.25% 2/24/09 2,500,000 1,266,081
-----------
19,738,547
-----------
<PAGE>
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds (continued)
Healthcare & Pharmaceuticals - 0.91%
Concentra Operating
13.00% 8/15/09 USD 55,000 $ 62,425
Extendicare Health Services
9.35% 12/15/07 100,000 96,500
Hanger Orthopedic Group 144A
10.375% 2/15/09 60,000 63,975
Healthsouth 10.75% 10/1/08 100,000 111,375
Kinetic Concepts Series B
9.625% 11/1/07 100,000 102,625
Radiologix 10.50% 12/15/08 75,000 78,750
Rotech Healthcare 9.50% 4/1/12 30,000 31,350
Triad Hospitals 8.75% 5/1/09 75,000 79,969
---------
626,969
---------
Industrial Machinery - 0.06%
Building Materials 7.75% 7/15/05 50,000 44,188
---------
44,188
---------
Leisure, Lodging & Entertainment - 1.08%
Alliance Gaming Series B
10.00% 8/1/07 100,000 105,499
Bally Total Fitness Holdings Series D
9.875% 10/15/07 20,000 20,450
Circus & Eldorado Joint Venture 144A
10.125% 3/1/12 80,000 83,600
Extended Stay America 9.875% 6/15/11 105,000 110,512
John Q Hammons Hotels 144A
8.875% 5/15/12 70,000 71,400
Mohegan Tribal Gaming Authority 144A
8.375% 7/1/11 55,000 56,650
Penn National Gaming 11.125% 3/1/08 50,000 54,250
Regal Cinemas 144A 9.375% 2/1/12 65,000 68,413
Six Flags 9.50% 2/1/09 90,000 93,600
Wheeling Island Gaming 144A
10.125% 12/15/09 75,000 78,938
---------
743,312
---------
Metals & Mining - 0.48%
Earle M Jorgensen 144A 9.75% 6/1/12 85,000 86,063
+++Weirton Steel 11.375% 7/1/04 950,000 242,250
---------
328,313
---------
Miscellaneous - 0.07%
aaiPharma 144A 11.00% 4/1/10 50,000 48,313
---------
48,313
---------
Packaging & Containers - 0.52%
AEP Industries 9.875% 11/15/07 75,000 74,999
BPC Holding 12.50% 6/15/06 50,000 53,000
Graphic Packaging 8.625% 2/15/12 50,000 52,500
Plastipak Holdings 10.75% 9/1/11 50,000 55,000
Portola Packaging 10.75% 10/1/05 25,000 25,063
Silgan 9.00% 6/1/09 to 6/1/09 90,000 94,276
---------
354,838
---------
10
<PAGE>
Statement
of Net Assets (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds (continued)
Paper & Forest Products - 0.28%
Georgia Pacific 9.50% 12/1/11 USD 85,000 $ 88,373
Tembec Industries 8.50% 2/1/11 100,000 102,250
----------
190,623
----------
Real Estate - 0.50%
HMH Properties Series B 7.875% 8/1/08 30,000 29,250
MeriStar Hospitality Operating
Partnership 144A 10.50% 6/15/09 50,000 53,125
Nationwide Health Properties
7.06% 12/5/06 100,000 98,226
RFS Partnership 144A 9.75% 3/1/12 50,000 52,500
Senior Housing Properties Trust
8.625% 1/15/12 45,000 47,025
Tanger Properties L.P. 9.125% 2/15/08 30,000 30,733
Ventas Realty 144A 9.00% 5/1/12 30,000 31,425
----------
342,284
----------
Retail - 0.88%
Avado Brands
9.75% 6/1/06 70,000 36,750
11.75% 6/15/09 100,000 14,000
Cole National Group 144A
8.875% 5/15/12 15,000 15,338
Gap 8.80% 12/15/08 65,000 66,001
J Crew Operating 10.375% 10/15/07 120,000 105,150
Levi Strauss & Company
11.625% 1/15/08 80,000 83,600
Office Depot 10.00% 7/15/08 125,000 138,124
Petco Animal Supplies 144A
10.75% 11/1/11 90,000 99,000
Remington Arms 9.50% 12/1/03 50,000 49,125
----------
607,088
----------
Telecommunications - 2.05%
Alcatel 4.375% 2/17/09 EUR 500,000 375,589
American Tower 9.375% 2/1/09 USD 55,000 38,225
Avaya 11.125% 4/1/09 75,000 74,625
Crown Castle International
10.75% 8/1/11 75,000 64,875
Dobson Communications
10.875% 7/1/10 25,000 22,250
EchoStar Broadband
10.375% 10/1/07 150,000 157,875
+++Global Crossing
8.70% 8/1/07 850,000 17,000
9.125% 11/15/06 50,000 1,000
Horizon PCS 144A
13.75% 6/15/11 40,000 23,800
Insight Midwest
9.75% 10/1/09 40,000 40,000
10.50% 11/1/10 75,000 76,688
Level 3 Communications
11.00% 3/15/08 100,000 49,000
Metromedia Fiber Network
10.00% 12/15/09 100,000 2,750
<PAGE>
Principal Market
Amount++ Value (U.S.$)
Non-Convertible Bonds (continued)
Telecommunications (continued)
Nextel Communications
9.375% 11/15/09 USD 275,000 $ 179,437
PanAmSat 144A 8.50% 2/1/12 55,000 55,413
Qwest 144A 8.875% 3/15/12 55,000 54,831
Qwest Capital Funding
7.25% 2/15/11 75,000 57,286
*SBA Communications
18.44% 3/1/08 100,000 64,500
WorldCom
7.50% 5/15/11 70,000 34,650
8.25% 5/15/31 50,000 21,750
----------
1,411,544
----------
Textiles, Apparel & Furniture - 0.08%
Collins & Aikman Floor Cover
9.75% 2/15/10 50,000 52,563
----------
52,563
----------
Transportation & Shipping - 0.29%
Atlas Air 10.75% 8/1/05 25,000 16,875
Hornbeck-Leevac Marine Services
10.625% 8/1/08 90,000 94,838
Petroleum Helicopters 9.375% 5/1/09 35,000 36,575
Teekay Shipping 8.875% 7/15/11 50,000 52,500
----------
200,788
----------
Utilities - 0.92%
Avista 9.75% 6/1/08 25,000 27,239
Calpine 10.50% 5/15/06 85,000 76,571
Calpine Canada Energy Finance
8.50% 5/1/08 140,000 114,949
CMS Energy 8.90% 7/15/08 100,000 97,134
Mission Energy 13.50% 7/15/08 65,000 67,925
Ocean Rig Norway 10.25% 6/1/08 45,000 40,725
PG&E National Energy Group
10.375% 5/16/11 80,000 82,544
Western Resources 144A
7.875% 5/1/07 25,000 25,376
9.75% 5/1/07 100,000 98,488
----------
630,951
----------
Total Non-Convertible Bonds
(cost $32,940,286) 30,392,376
----------
Short-Term Securities - 4.45%
**U.S. Treasury Bill 1.647% 6/6/02 3,065,000 3,064,294
----------
Total Short-Term Securities
(cost $3,064,294) 3,064,294
----------
11
<PAGE>
Statement
of Net Assets (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
Total Market Value of Securities - 130.29%
(cost $89,293,963) $89,713,307
-----------
***Liabilities Net of Receivables and
Other Assets - (30.29%) (20,855,663)
-----------
Net Assets Applicable to 5,985,582 Shares
($0.01 par value) Outstanding; Equivalent
to $11.50 per Share - 100.00% $68,857,644
-----------
Components of Net Assets at May 31, 2002:
Common stock, $0.01 par value, 500,000,000
shares authorized to the Fund $82,781,531
Treasury stock, 665,065 shares, at cost (8,599,291)
Distributions in excess of net investment income(a) (3,943,563)
Accumulated net realized loss on investments
and foreign currencies (1,761,222)
Net unrealized appreciation of investments
and foreign currencies 380,189
-----------
Total net assets $68,857,644
===========
+Non-income producing security for the period ended May 31, 2002.
++Principal amount is stated in the currency in which each bond is denominated.
+++Non-income producing security. Security is currently in default.
*Zero coupon bond. The interest rate shown is the step-up rate.
**U.S. Treasury bills are traded on a discount basis; the interest rate shown
is the effective yield at the time of purchase by the Fund.
***Of this amount, $21,000,000 represents borrowings under the Fund's Line of
Credit as of May 31, 2002. See Note 6 in "Notes to Financial Statements".
(a)Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.
Summary of Abbreviations
ADR - American Depositary Receipts
PEPS - Partial Equity Linked Securities
PIK - Pay-in-kind
TIDES - Term Income Deferred Equity Securities
AUD - Australian Dollar
EUR - European Monetary Unit
NZD - New Zealand Dollar
PLZ - Polish Zloty
USD - U.S. Dollar
ZAR - South African Rand
See accompanying notes
12
<PAGE>
Statement
of Operations
Delaware Investments Global Dividend and Income Fund, Inc.
Period Ended May 31, 2002 (Unaudited)
Investment Income
Interest $1,315,994
Dividends (net of foreign taxes withheld of $27,800) 1,080,614 $ 2,396,608
---------- -----------
Expenses:
Management fees 311,558
Accounting and administration expenses 50,000
Professional fees 40,600
Reports and statements to shareholders 17,000
Transfer agent fees 15,000
Custodian fees 13,390
NYSE fees 12,480
Directors' fees 3,846
Taxes (other than taxes on income) 1,140
Other 30,042
----------
Total operating expenses (before interest expense) 495,056
Interest expense 285,127
-----------
Total operating expenses (after interest expense) 780,183
Less expenses paid indirectly (888)
Total expenses 779,295
-----------
Net Investment Income 1,617,313
-----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies:
Net realized loss on:
Investments (588,515)
Foreign currencies (1,181,923)
-----------
Net realized loss (1,770,438)
Net change in unrealized appreciation/depreciation
on investments and foreign currencies 6,630,633
-----------
Net Realized and Unrealized Gain on Investments and
Foreign Currencies 4,860,195
-----------
Net Increase in Net Assets Resulting from Operations $ 6,477,508
===========
See accompanying notes
13
<PAGE>
Statements
of Changes in Net Assets
<TABLE>
<CAPTION>
Delaware Investments Global Dividend and Income Fund, Inc.
Period Year
Ended Ended
5/31/02 11/30/01
(Unaudited)
<S> <C> <C>
Increase (Decrease) in Net Assets from Operations:
Net investment income $ 1,617,313 $ 3,710,472
Net realized loss on investments and foreign currencies (1,770,438) (3,623,997)
Net change in unrealized appreciation/depreciation of investments and foreign currencies 6,630,633 5,341,691
----------- -----------
Net increase in net assets resulting from operations 6,477,508 5,428,166
----------- -----------
Dividends and Distributions to Shareholders from:
Net investment income (4,489,581) (1,179,716)
Net realized gain on investments -- (502,789)
Return of capital -- (7,296,404)
----------- -----------
(4,489,581) (8,978,909)
----------- -----------
Net Increase (Decrease) in Net Assets 1,987,927 (3,550,743)
Net Assets:
Beginning of period 66,869,717 70,420,460
----------- -----------
End of period $68,857,644 $66,869,717
=========== ===========
See accompanying notes
14
</TABLE>
<PAGE>
Statement
of Cash Flows
<TABLE>
<CAPTION>
Delaware Investments Global Dividend and Income Fund, Inc.
Period Ended May 31, 2002 (Unaudited)
<S> <C>
Net Cash (Including Foreign Currency) Provided by Operating Activities:
Net increase in net assets resulting from operations $ 6,477,508
------------
Adjustments to reconcile net increase in net assets from operations to cash provided by operating activities:
Amortization of discount on securities (110,316)
Net proceeds from investment transactions 5,826,153
Net realized loss on investments 588,515
Net realized loss on foreign currencies 1,181,923
Net change in unrealized appreciation/depreciation of
investments and foreign currencies (6,630,633)
Decrease in receivable for investments sold 909,919
Decrease in interest and dividends receivable 251,373
Increase in payable for investments purchased 365,986
Decrease in interest payable (27,552)
Increase in accrued expenses and other liabilities 12,226
------------
Total adjustments 2,367,594
------------
Net cash provided by operating activities 8,845,102
------------
Cash flows used for financing activities:
Proceeds from line of credit (Note 6) 21,000,000
Principal repayment on line of credit (Note 6) (25,000,000)
Cash dividends and distributions paid (4,489,581)
------------
Net cash used for financing activities (8,489,581)
------------
Effect of exchange rates on cash (48,915)
------------
Net increase in cash 306,606
Cash at beginning of period (260,164)
------------
Cash at end of period $ 46,442
============
Cash paid for interest $ 311,415
============
See accompanying notes
15
</TABLE>
<PAGE>
Financial
Highlights
Selected data for each share of the Fund outstanding
throughout each period were as follows:
<TABLE>
<CAPTION>
Delaware Investments Global Dividend and Income Fund, Inc.
Period
Ended Year Ended
5/31/02(3) 11/30/01 11/30/00 11/30/99 11/30/98 11/30/97
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $11.170 $11.770 $13.920 $15.700 $ 17.090 $15.810
Income (loss) from investment operations:
Net investment income 0.270 0.620 0.700 0.930 1.090 1.000
Net realized and unrealized gain (loss) on investments
and foreign currencies 0.810 0.280 (1.350) (1.070) (0.700) 1.780
------- ------- ------- ------- -------- --------
Total from investment operations 1.080 0.900 (0.650) (0.140) 0.390 2.780
------- ------- ------- ------- -------- --------
Less dividends and distributions from:
Net investment income (0.750) (0.195) (0.530) (0.860) (1.380) (0.950)
Net realized gains on investment transactions -- (0.084) (0.470) (0.780) (0.400) (0.550)
Return of capital -- (1.221) (0.500) -- -- --
------- ------- ------- ------- -------- --------
Total dividends and distributions (0.750) (1.500) (1.500) (1.640) (1.780) (1.500)
------- ------- ------- ------- -------- --------
Net asset value, end of period $11.500 $11.170 $11.770 $13.920 $ 15.700 $ 17.090
======= ======= ======= ======= ======== ========
Market value, end of period $13.200 $12.400 $10.380 $11.750 $ 15.880 $ 17.310
======= ======= ======= ======= ======== ========
Total return based on:(1)
Market value 12.92% 34.52% 0.29% (17.00%) 2.05% 18.98%
Net asset value 9.21% 6.91% (4.04%) (0.57%) 2.19% 17.93%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $68,858 $66,870 $70,420 $92,601 $104,446 $113,685
Ratio of total operating expenses to average net assets 2.34% 3.31% 3.45% 2.69% 2.69% 2.67%
Ratio of total operating expenses to adjusted average
net assets (before interest expense)(2) 1.11% 1.10% 1.04% 1.00% 1.03% 1.02%
Ratio of interest expense to adjusted average net assets(2) 0.64% 1.35% 1.62% 1.15% 1.16% 1.16%
Ratio of net investment income to average net assets 4.86% 5.18% 5.34% 6.14% 6.63% 6.03%
Ratio of net investment income to adjusted average net
assets(2) 3.65% 3.84% 4.11% 4.92% 5.38% 4.93%
Portfolio turnover 72% 47% 43% 58% 51% 68%
Leverage analysis:
Debt outstanding at end of period (000 omitted) $21,000 $25,000 $25,000 $25,000 $25,000 $25,000
Average daily balance of debt outstanding (000 omitted) $22,209 $25,000 $25,000 $25,000 $25,000 $25,000
Average daily balance of shares outstanding (000 omitted) 5,986 5,986 6,389 6,651 6,651 6,651
Average debt per share $3.71 $4.18 $3.91 $3.76 $3.76 $3.76
</TABLE>
(1) Total investment return is calculated assuming a purchase of common stock on
the opening of the first day and a sale on the closing of the last day of
each period reported. Dividends and distributions are assumed for the
purposes of this calculation, to be reinvested at prices obtained under the
Fund's dividend reinvestment plan. Generally, total investment return based
on net asset value will be higher than total investment return based on
market value in periods where there is an increase in the discount or a
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total investment return
based on net asset value will be lower than total investment return based on
market value in periods where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such periods.
(2) Adjusted average net assets excludes debt outstanding.
(3) Ratios have been annualized and total return has not been annualized. As
required, effective December 1, 2001, the Fund has adopted the provisions of
the AICPA Audit and Accounting Guide for Investment Companies that requires
amortization of all premium and discounts on debt securities as an
adjustment to interest income. The effect of these changes for the six
months ended May 31, 2002 was a decrease in net investment income per share
of $0.005, an increase in net realized and unrealized gain (loss) per share
of $0.005, a decrease in the ratio of net investment income to average net
assets of 0.09%, and a decrease in the ratio of net investment income to
adjusted average net assets of 0.06%. Per share data for periods prior to
December 1, 2001 have not been restated to reflect this change in
accounting.
See accompanying notes
16
<PAGE>
Notes
to Financial Statements
Delaware Investments Global Dividend and Income Fund, Inc.
Period Ended May 31, 2002 (Unaudited)
Delaware Investments Global Dividend and Income Fund, Inc. (the "Fund") is
organized as a Maryland corporation and is a diversified closed-end management
investment company under the Investment Company Act of 1940, as amended. The
Fund's shares trade on the New York Stock Exchange.
The investment objective of the Fund is to seek high current income. Capital
appreciation is a secondary objective.
1. Significant Accounting Policies
The following accounting policies are in accordance with accounting principles
generally accepted in the United States and are consistently followed by the
Fund.
Security Valuation - All equity securities are valued at the last quoted sales
price as of the time of the regular close of the New York Stock Exchange (NYSE)
on the valuation date. If on a particular day an equity security does not trade,
then the mean between the bid and asked prices will be used. Securities listed
on a foreign exchange are valued at the last quoted sales price before the Fund
is valued. Long-term debt securities are valued by an independent pricing
service and such prices are believed to reflect the fair value of such
securities. Short-term debt securities having less than 60 days to maturity are
valued at amortized cost, which approximates market value. Other securities and
assets for which market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of the Fund's Board
of Directors.
Federal Income Taxes - The Fund intends to continue to qualify for federal
income tax purposes as a regulated investment company and make the requisite
distributions to shareholders. Accordingly, no provision for federal income
taxes has been made in the financial statements.
Distributions - In December 1995, the Fund implemented a managed distribution
policy. Under the policy, the Fund declares and pays monthly distributions at an
annual rate of not less than $1.50 per share and is managed with a goal of
generating as much of the distribution as possible from ordinary income (net
investment income and short-term capital gains). The balance of the distribution
then comes from long-term capital gains and, if necessary, a return of capital.
Borrowings - The Fund has entered into a $21,000,000 Line of Credit Agreement
with J.P. Morgan Chase Bank (See Note 6).
Foreign Currency Transactions - Transactions denominated in foreign currencies
are recorded at the prevailing exchange rates on the valuation date. The value
of all assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rate of such currencies against the U.S.
dollar daily. Transaction gains or losses resulting from changes in exchange
rates during the reporting period or upon settlement of the foreign currency
transaction are reported in operations for the current period. It is not
practical to isolate that portion of both realized and unrealized gains and
losses on investments in equity securities that result from fluctuations in
foreign currency exchange rates in the Statement of Operations. The Fund does
isolate that portion of gains and losses on investments in debt securities,
which are due to changes in foreign exchange rates from that which are due to
changes in market prices of debt securities. The Fund reports certain foreign
currency related transactions as components of realized gains (losses) for
financial reporting purposes, where such components are treated as ordinary
income (loss) for federal income tax purposes.
<PAGE>
Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Other - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Security transactions are recorded on the date the securities are purchased or
sold (trade date). Costs used in calculating realized gains and losses on the
sale of investment securities are those of the specific securities sold.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. Original issue discounts are amortized to
interest income over the lives of the respective securities. Foreign dividends
are also recorded on the ex-dividend date or as soon after the ex-dividend date
that the Fund is aware of such dividends, net of all non-rebatable tax
withholdings. Withholding taxes on foreign dividends have been provided for in
accordance with the Fund's understanding of the applicable country's tax rules
and rates.
Change in Accounting Principle - As required, effective December 1, 2001, the
Fund has adopted the provisions of the AICPA Audit and Accounting Guide for
Investment Companies (the "Guide") and began amortizing all discount or premium
on debt securities. Prior to December 1, 2001, the Fund did not amortize premium
or market discount, which conformed to the Fund's policy for federal income tax
purposes. The cumulative effect of this accounting change had no impact on total
net assets of the Fund, but resulted in a $75,551 increase in cost of securities
and a corresponding $75,551 reduction in net unrealized appreciation
(depreciation) based on securities held by the Fund on December 1, 2001.
The effect of these changes for the period ended May 31, 2002, was a decrease in
net investment income of $28,720, a decrease in net unrealized appreciation
(depreciation) of $5,294, and an increase in net realized gains (losses) of
$34,014. The Statements of Changes in Net Assets and Financial Highlights for
prior periods have not been restated to reflect this change in accounting.
Certain expenses of the Fund are paid through commission arrangements with
brokers. These transactions are done subject to best execution. The amount of
these expenses was approximately $798 for the period ended May 31, 2002. In
addition, the Fund receives earnings credits from its custodian when positive
cash balances are maintained, which are used to offset custody fees. The
earnings credits for the period ended May 31, 2002 were approximately $90. The
expenses paid under the above arrangements are included in their respective
expense captions on the Statement of Operations with the corresponding expense
offset shown as "expenses paid indirectly".
17
<PAGE>
Notes
to Financial Statements (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
2. Investment Management, Administration Agreements
and Other Transactions with Affiliates
In accordance with the terms of its investment management agreement, the Fund
pays Delaware Management Company (DMC), a series of Delaware Management Business
Trust and the investment manager, an annual fee of 0.70% which is calculated
daily based on the adjusted average weekly net assets.
DMC has entered into a sub-advisory agreement with Delaware International
Advisers Ltd. (DIAL), an affiliate of DMC, related to the foreign securities
portion of the Fund. For the services provided, DMC pays DIAL a monthly fee
equal to 40% of the fee paid to DMC under the terms of the Investment Management
Agreement. The Fund does not pay any fees directly to DIAL.
The Fund has engaged Delaware Service Company, Inc. (DSC), an affiliate of DMC
and DIAL, to provide accounting and administration services. The Fund pays DSC a
monthly fee computed at the annual rate of 0.05% of the Fund's adjusted weekly
net assets, subject to an annual minimum of $100,000.
For purposes of the calculation of investment management fees and administration
fees, adjusted average weekly net assets does not include the line of credit
liability.
At May 31, 2002, the Fund had liabilities payable to affiliates as follows:
Investment management fee payable to DMC $52,239
Accounting and other expenses payable to DSC 11,569
Other expenses payable to DMC and affiliates 3,286
Certain officers of DMC, DIAL and DSC are officers and/or directors the Fund.
These officers and directors are paid no compensation by the Fund.
3. Investments
For the period ended May 31, 2002, the Fund made purchases of $30,270,195 and
sales of $35,787,866 of investment securities other than U.S. government
securities and short-term investments.
At May 31, 2002, the cost of investments for federal income tax purposes
approximates the cost for book purposes. At May 31, 2002, the cost of
investments was $89,178,041. At May 31, 2002, the net unrealized appreciation
was $535,262 of which $8,863,630 related to unrealized appreciation of
investments and $8,328,368 related to unrealized depreciation of investments.
4. Dividend and Distribution Information
Income and long-term capital gain distributions are determined in accordance
with federal income tax regulations, which may differ from accounting principles
generally accepted in the United States. The tax character of dividends and
distributions paid during the period ended May 31, 2002 and the year ended
November 30, 2001 was as follows:
May 31, 2002 November 30, 2001
Ordinary Income $4,489,581 $1,179,716
Long-term capital gain -- 502,789
Return of capital -- 7,296,404
---------- ----------
Total $4,489,581 $8,978,909
========== ==========
For federal income tax purposes, capital loss carryforwards may be carried
forward and applied against future capital gains. Such capital loss
carryforwards expire as follows: $1,093,240 in 2009.
<PAGE>
5. Capital Stock
The Fund did not repurchase any shares under the Share Repurchase Program during
the period ended May 31, 2002.
Shares issuable under the Fund's dividend reinvestment plan are purchased by the
Fund's transfer agent, Mellon Investor Services, LLC, in the open market.
For the period ended May 31, 2002, the Fund did not have any transactions in
common shares.
6. Line of Credit
The Fund has entered into a Line of Credit Agreement with J.P. Morgan Chase Bank
for $21,000,000. At May 31, 2002, the par value of loans outstanding was
$21,000,000 at a variable interest rate of 2.47%. During the period, the average
daily balance of loans outstanding was $22,208,791 at a weighted average
interest rate of approximately 2.50%. The maximum amount of loans outstanding at
any time during the period was $25,000,000. The loan is collateralized by the
Fund's portfolio.
7. Foreign Exchange Contracts
The Fund may enter into forward foreign currency exchange as a way of managing
foreign exchange rate risk. The Fund may enter into these contracts to fix the
U.S. dollar value of a security that it has agreed to buy or sell for the period
between the date the trade was entered into and the date the security is
delivered and paid for. The Fund may also use these contracts to hedge the U.S.
dollar value of securities it already owns that are denominated in foreign
currencies.
Forward foreign currency exchange contracts are valued at the mean between the
bid and asked prices of the contracts and are marked-to-market daily.
Interpolated values are derived when the settlement date of the contract is an
interim date for which quotations are not available. The change in market value
is recorded as an unrealized gain or loss. When the contract is closed, a
realized gain or loss is recorded equal to the difference between the value of
the contract at the time it was opened and the value at the time it was closed.
The use of forward foreign currency exchange contracts does not eliminate
fluctuations in the underlying prices of the securities, but it does establish a
rate of exchange that can be achieved in the future. Although forward foreign
currency exchange contracts limit the risk of loss due to a decline in the value
of the hedged currency, they also limit any potential gain that might result
should the value of the currency increase. In addition, the Fund could be
exposed to risks if the counterparties to the contracts are unable to meet the
terms of their contracts.
No forward foreign currency exchange contracts were outstanding at May 31, 2002.
18
<PAGE>
Notes
to Financial Statements (continued)
Delaware Investments Global Dividend and Income Fund, Inc.
8. Geographic Disclosure
As of May 31, 2002, the Fund's geographic diversification* was as follows:
Country Market Value
----------------------------------------------------------------------------
United States $51,946,241 57.90%
----------------------------------------------------------------------------
United Kingdom 5,969,991 6.65%
----------------------------------------------------------------------------
Australia 5,368,515 5.98%
----------------------------------------------------------------------------
Germany 4,682,992 5.22%
----------------------------------------------------------------------------
New Zealand 3,790,378 4.22%
----------------------------------------------------------------------------
South Africa 3,617,901 4.03%
----------------------------------------------------------------------------
France 2,352,637 2.62%
----------------------------------------------------------------------------
Mexico 2,242,103 2.50%
----------------------------------------------------------------------------
Poland 1,873,036 2.09%
----------------------------------------------------------------------------
Greece 1,652,513 1.84%
----------------------------------------------------------------------------
Belgium 1,532,398 1.71%
----------------------------------------------------------------------------
Netherlands 1,223,104 1.36%
----------------------------------------------------------------------------
Hong Kong 912,556 1.02%
----------------------------------------------------------------------------
Spain 911,902 1.02%
----------------------------------------------------------------------------
Italy 795,347 0.89%
----------------------------------------------------------------------------
Austria 390,984 0.44%
----------------------------------------------------------------------------
Japan 283,260 0.32%
----------------------------------------------------------------------------
Canada 114,949 0.13%
----------------------------------------------------------------------------
Bahamas 52,500 0.06%
----------------------------------------------------------------------------
Total $89,713,307 100.00%
----------------------------------------------------------------------------
* Based on the issuer of each security's domicile.
Like any investment in securities, the value of the portfolio may be subject to
risk or loss from market currency, economic and political factors which occur in
the countries where the Fund is invested.
<PAGE>
9. Credit and Market Risks
Some countries in which the Fund may invest require governmental approval for
the repatriation of investment income, capital or the proceeds of sales of
securities by foreign investors. In addition, if there is deterioration in a
country's balance of payments or for other reasons, a country may impose
temporary restrictions on foreign capital remittances abroad.
The securities exchanges of certain foreign markets are substantially smaller,
less liquid and more volatile than the major securities markets in the United
States. Consequently, acquisition and disposition of securities by the Fund may
be inhibited. In addition, a significant portion of the aggregate market value
of equity securities listed on the major securities exchanges in emerging
markets are held by a smaller number of investors. This may limit the number of
shares available for acquisition or disposition by the Fund.
The Fund may invest in high-yield fixed income securities, which carry ratings
of BB or lower by S&P and/or Ba or lower by Moody's. Investments in these higher
yielding securities are generally accompanied by a greater degree of credit risk
than higher rated securities. Additionally, lower rated securities may be more
susceptible to adverse economic and competitive industry conditions than
investment grade securities.
The Fund may invest up to 10% of its total assets in illiquid securities which
may include securities with contractual restrictions on resale, securities
exempt from registration under Rule 144A of the Securities Act of 1933, as
amended, and other securities which may not be readily marketable. The relative
illiquidity of these securities may impair the Fund from disposing of them in a
timely manner and at a fair price when it is necessary or desirable to do so.
The fund invests in the real estate industry and is subject to some of the risks
associated with that industry. If the Fund holds real estate directly as a
result of defaults or receives rental income directly form real estate holdings,
its tax status as a regulated investment company may be jeopardized. There were
no direct holdings during the period ended May 31, 2002. The Fund is also
affected by interest rate changes, particularly if the real estate investment
trusts it holds use floating rate debt to finance their ongoing operations.
19
<PAGE>
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<PAGE>
Delaware Investments
Family of Funds
--------------------------------------------------------------------------------
Complete information on any fund offered by Delaware Investments can be found in
each fund's current prospectus. Prospectuses for all funds offered by Delaware
Investments are available from your financial advisor. Please read the
prospectus carefully before you invest or send money.
--------------------------------------------------------------------------------
Growth-Equity Group
Delaware American Services Fund
Delaware Growth Opportunities Fund
Delaware Select Growth Fund
Delaware Small Cap Growth Fund
Delaware Technology and Innovation Fund
Delaware Trend Fund
Delaware U.S. Growth Fund
Value-Equity Group
Delaware Decatur Equity Income Fund
Delaware Growth and Income Fund
Delaware REIT Fund
Delaware Small Cap Value Fund
International Group
(DIAL-Delaware International Advisers Ltd.)
Delaware Emerging Markets Fund
Delaware International Small Cap Value Fund
Delaware International Value Equity Fund
(formerly Delaware International Equity Fund)
Blend Mutual Funds
Delaware Balanced Fund
Delaware Core Equity Fund
(formerly Delaware Growth Stock Fund)
Delaware Devon Fund
Delaware Social Awareness Fund
Structured Equity Products Group
Delaware Diversified Growth Fund
Delaware Diversified Value Fund
Delaware Group Foundation Funds
Delaware Balanced Allocation Portfolio
Delaware Growth Allocation Portfolio
Delaware Income Allocation Portfolio
<PAGE>
Fixed Income Group
Corporate and Government
Delaware American Government Bond Fund
Delaware Corporate Bond Fund
Delaware Delchester Fund
Delaware Extended Duration Bond Fund
Delaware High-Yield Opportunities Fund
Delaware Limited-Term Government Fund
Delaware Strategic Income Fund
Money Market
Delaware Cash Reserve Fund
Delaware Tax-Free Money Fund
Municipal (National Tax-Exempt)
Delaware National High-Yield Municipal Bond Fund
Delaware Tax-Free Insured Fund
Delaware Tax-Free USA Fund
Delaware Tax-Free USA Intermediate Fund
Municipal (State-Specific Tax-Exempt)
Delaware Tax-Free Arizona Fund
Delaware Tax-Free Arizona Insured Fund
Delaware Tax-Free California Fund
Delaware Tax-Free California Insured Fund
Delaware Tax-Free Colorado Fund
Delaware Tax-Free Florida Fund
Delaware Tax-Free Florida Insured Fund
Delaware Tax-Free Idaho Fund
Delaware Minnesota High-Yield Municipal Bond Fund
Delaware Tax-Free Minnesota Fund
Delaware Tax-Free Minnesota Insured Fund
Delaware Tax-Free Minnesota Intermediate Fund
Delaware Tax-Free Missouri Insured Fund
Delaware Tax-Free New York Fund
Delaware Tax-Free Oregon Insured Fund
Delaware Tax-Free Pennsylvania Fund
<PAGE>
DGF
Delaware NYSE
Investments(SM) Listed
---------------------------------------
A member of Lincoln Financial Group(R)
This semiannual report is for the information of Delaware Investments Global
Dividend and Income Fund, Inc. shareholders. The return and principal value of
an investment in the Fund will fluctuate so that shares, when resold, may be
worth more or less than their original cost.
Notice is hereby given in accordance with Section 23(c) of the Investment Act of
1940 that the Fund may, from time to time, purchase shares of its Common Stock
on the open market at market prices.
<TABLE>
<CAPTION>
Board of Directors Affiliated Officers Contact Information
<S> <C> <C>
Charles E. Haldeman, Jr. William E. Dodge Investment Manager
Chairman Executive Vice President and Delaware Management Company
Delaware Investments Family of Funds Chief Investment Officer, Equity Philadelphia, PA
Philadelphia, PA Delaware Investments Family of Funds
Philadelphia, PA International Affiliate
Walter P. Babich Delaware International Advisers Ltd.
Board Chairman Jude T. Driscoll London, England
Citadel Constructors, Inc. Executive Vice President and
King of Prussia, PA Head of Fixed Income Principal Office of the Fund
Delaware Investments Family of Funds 2005 Market Street
David K. Downes Philadelphia, PA Philadelphia, PA 19103
President and Chief Executive Officer
Delaware Investments Family of Funds Richard J. Flannery Independent Auditors
Philadelphia, PA President and Chief Executive Officer Ernst & Young, LLP
Delaware Distributors, L.P. 2001 Market Street
John H. Durham Philadelphia, PA Philadelphia, PA 19103
Private Investor
Gwynedd Valley, PA Joseph H. Hastings Registrar and Stock Transfer Agent
Senior Vice President/Corporate Controller Mellon Investor Services, LLC
John A. Fry Overpeck Centre
Executive Vice President Michael P. Bishof 85 Challenger Road
University of Pennsylvania Senior Vice President/Treasurer Ridgefield, NJ 07660
Philadelphia, PA 800 851-9677
Lisa O. Brinkley
Anthony D. Knerr Senior Vice President/Compliance Director For Securities Dealers and Financial
Consultant Institutions Representatives Only
Anthony Knerr & Associates Richelle S. Maestro 800 362-7500
New York, NY Senior Vice President/Deputy General
Counsel/Secretary Web site
www.delawareinvestments.com
Ann R. Leven+ John J. O'Connor
Former Treasurer/Chief Fiscal Officer Senior Vice President/Assistant Treasurer
National Gallery of Art
Washington, DC
Thomas F. Madison+
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
Janet L. Yeomans
Vice President and Treasurer
3M Corporation
St. Paul, MN
+Audit Committee Member
(6216) Printed in the USA
SA-DGF [5/02] VGR 7/02 J8353
</TABLE>
</TEXT>
</DOCUMENT>