-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UR4cA0shePgfUPsV03zJoA041visEyJYw+kI32KpRXZzq7Mb+PMFvCs7c8rWWVWt 5J0waj3wPSSDlgizhClGzQ== 0000950116-04-002400.txt : 20040806 0000950116-04-002400.hdr.sgml : 20040806 20040806161042 ACCESSION NUMBER: 0000950116-04-002400 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20040531 FILED AS OF DATE: 20040806 EFFECTIVENESS DATE: 20040806 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DELAWARE INVESTMENTS GLOBAL DIVIDEND & INCOME FUND INC CENTRAL INDEX KEY: 0000916713 IRS NUMBER: 232753201 STATE OF INCORPORATION: MD FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-08246 FILM NUMBER: 04958272 BUSINESS ADDRESS: STREET 1: 2005 MARKET STREET CITY: PHILADELPHIA STATE: PA ZIP: 19103 BUSINESS PHONE: 2152552127 MAIL ADDRESS: STREET 1: 2005 MARKET STREET STREET 2: . CITY: PHILADELPHIA STATE: PA ZIP: 19103 FORMER COMPANY: FORMER CONFORMED NAME: DELAWARE GROUP GLOBAL DIVIDEND & INCOME FUND INC DATE OF NAME CHANGE: 19931229 N-CSR 1 ncsr.txt N-CSR UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number: 811-8246 Exact name of registrant as specified in charter: Delaware Investments Global Dividend and Income Fund, Inc. Address of principal executive offices: 2005 Market Street Philadelphia, PA 19103 Name and address of agent for service: Richelle S. Maestro, Esq. 2005 Market Street Philadelphia, PA 19103 Registrant's telephone number, including area code: (800) 523-1918 Date of fiscal year end: November 30 Date of reporting period: May 31, 2004 Item 1. Reports to Stockholders Delaware Investments(SM) -------------------------------------- A member of Lincoln Financial Group(R) CLOSED END SEMIANNUAL REPORT MAY 31, 2004 - -------------------------------------------------------------------------------- DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. [LOGO OMITTED] POWERED BY RESEARCH.(SM) TABLE OF CONTENTS - --------------------------------------------------------- FINANCIAL STATEMENTS: Statement of Net Assets 1 Statement of Operations 7 Statements of Changes in Net Assets 8 Statement of Cash Flows 9 Financial Highlights 10 Notes to Financial Statements 11 - --------------------------------------------------------- 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 Management Company, a series of Delaware Management Business Trust, and Delaware International Advisers Ltd., which are both registered investment advisors. (C) 2004 Delaware Distributors, L.P. STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS May 31, 2004 (Unaudited)
Number of Market Shares Value (U.S.$) COMMON STOCK - 73.00% Automobiles & Automotive Parts - 1.96% General Motors 10,200 $ 462,978 GKN 75,215 315,798 Goodrich (B.F.) 23,500 658,705 ----------- 1,437,481 ----------- Banking, Finance & Insurance - 15.18% *American Home Mortgage Investment 28,000 714,000 Aviva 62,582 611,569 Banca Intesa 122,699 440,511 Banco Santander Central Hispano 39,771 422,042 Bank of America 8,300 689,979 +++Fieldstone Investments 144A 25,000 431,250 Friedman Billings Ramsey Group Class A 25,940 505,830 HBOS 54,179 709,248 ING Groep NV 27,494 620,453 J.P. Morgan Chase 14,500 534,180 Lloyds TSB Group 87,256 689,112 MBNA 36,400 924,560 Mellon Financial 20,700 609,408 Morgan Stanley 15,800 845,458 National Australia Bank 27,457 589,759 Overseas Chinese Banking 41,000 289,284 Societe Generale Class A 5,887 498,910 ++Sunset Financial Resources 31,200 325,416 Wells Fargo 11,400 670,320 ----------- 11,121,289 ----------- Building & Materials - 1.29% Compagnie de Saint Gobain 12,800 644,768 Wharf Holdings 106,000 299,208 ----------- 943,976 ----------- Cable, Media & Publishing - 0.05% ++XM Satellite Radio Class A 1,500 37,770 ----------- 37,770 ----------- Chemicals - 2.78% Bayer 22,875 651,975 BOC Group 10,290 167,626 Dow Chemical 25,500 1,017,451 Orica 19,167 200,376 ----------- 2,037,428 ----------- Computers & Technology - 1.69% ++Intuit 15,700 615,126 Pitney Bowes 14,100 625,053 ----------- 1,240,179 ----------- Consumer Products - 0.62% Procter & Gamble 4,200 452,844 ----------- 452,844 ----------- Electronics & Electrical Equipment - 2.26% Emerson Electric 10,000 597,000 General Electric 20,100 625,512 Hong Kong Electric 103,000 430,824 ----------- 1,653,336 ----------- Energy - 5.51% BP Amoco 51,154 449,011 ChevronTexaco 8,300 750,320 Exxon Mobil 11,800 510,350 Kerr-McGee 11,600 571,300
Number of Market Shares Value (U.S.$) COMMON STOCK (continued) Energy (continued) ++Petroleum Geo-Services ADR 397 $ 14,611 Royal Dutch Petroleum 13,709 686,371 Sasol 27,194 412,606 Total 3,440 645,656 ----------- 4,040,225 ----------- Food, Beverage & Tobacco - 4.94% Anheuser-Busch 15,500 825,685 Foster's Group 191,687 623,753 General Mills 14,300 658,515 Kellogg 14,500 614,800 Mitchells & Butlers 29,029 137,715 PepsiCo 14,200 757,854 ----------- 3,618,322 ----------- Healthcare & Pharmaceuticals - 5.54% Abbott Laboratories 12,500 515,125 Eisai 9,400 244,090 GlaxoSmithKline 34,722 727,646 ++Hospira 1,250 32,050 Merck & Co. 10,400 491,920 Pfizer 17,200 607,848 Takeda Chemical Industries 9,400 390,373 ++Tenet Healthcare 54,700 652,024 Wyeth 11,000 396,000 ----------- 4,057,076 ----------- Industrial Machinery - 0.38% Brambles Industries 71,495 277,240 ----------- 277,240 ----------- Investment Companies - 0.80% *Gladstone Capital 29,200 586,920 ----------- 586,920 ----------- Leisure, Lodging & Entertainment - 0.54% Intercontinental Hotels Group 41,125 393,968 ----------- 393,968 ----------- Metals & Mining - 0.62% Rio Tinto 18,880 453,464 ----------- 453,464 ----------- Paper & Forest Products - 2.40% Amcor 78,646 366,475 International Paper 16,400 687,652 UPM-Kymmene Oyj 13,900 249,518 Weyerhaeuser 7,500 453,600 ----------- 1,757,245 ----------- Real Estate - 13.58% AMB Property 18,300 604,815 Apartment Investment & Management 14,500 418,760 BRE Properties Class A 11,100 384,060 Camden Property Trust 4,400 205,524 Duke Realty 26,000 841,360 General Growth Properties 73,110 2,147,972 Liberty Property Trust 21,042 839,365 +++Medical Properties Trust 144A 9,400 94,000 Pan Pacific Retail Properties 17,600 809,600 Prentiss Properties Trust 21,308 703,164 Ramco-Gershenson Properties 31,300 757,460 Reckson Associates Realty 25,000 650,500
1 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS (CONTINUED)
Number of Market Shares Value (U.S.$) COMMON STOCK (continued) Real Estate (continued) Simon Property Group 8,000 $ 412,560 Starwood Hotels & Resorts Worldwide 21,700 915,306 Sun Communities 4,400 162,712 ---------- 9,947,158 ---------- Retail - 2.45% Boots 44,819 541,523 Coles Myer 91,055 551,653 GUS 43,481 646,531 *++Kmart Holdings 1,053 55,230 ---------- 1,794,937 ---------- Technology/Semiconductors - 0.89% Intel 22,900 653,795 ---------- 653,795 ---------- Telecommunications - 3.95% Alltel 19,600 992,348 Telecom Corporation of New Zealand 189,000 660,295 Telefonica 45,877 665,551 Telstra 172,136 576,102 ---------- 2,894,296 ---------- Transportation & Shipping - 0.33% West Japan Railway 63 244,533 ---------- 244,533 ---------- Utilities - 5.24% BG Group 66,367 404,892 Dominion Resources 8,900 560,433 Electrabel 1,376 448,473 FPL Group 13,100 835,125 Hong Kong & China Gas 104,000 164,128 Iberdrola 29,226 589,588 RWE 19,081 837,662 ---------- 3,840,301 ---------- TOTAL COMMON STOCK (cost $43,738,588) 53,483,783 ---------- CONVERTIBLE PREFERRED STOCK - 2.31% Aerospace & Defense - 0.55% Northrop Grumman 7.25% 3,850 400,785 ---------- 400,785 ---------- Banking, Finance & Insurance - 0.74% Chubb 7.00% 4,000 111,160 Travelers Property Casualty 4.50% 12,000 286,320 XL Capital 6.50% 6,000 150,240 ---------- 547,720 ---------- Environmental Services - 0.39% Allied Waste Industries 6.25% 4,000 288,760 ---------- 288,760 ---------- Telecommunications - 0.63% Lucent Technologies Capital Trust I 7.75% 400 458,676 ---------- 458,676 ---------- TOTAL CONVERTIBLE PREFERRED STOCK (cost $1,661,000) 1,695,941 ----------
Number of Market Shares Value (U.S.$) PREFERRED STOCK - 3.52% Leisure, Lodging & Entertainment - 0.54% WestCoast Hospitality Capital Trust 9.50% 15,700 $ 396,896 ---------- 396,896 ---------- Metals & Mining - 0.01% ++Weirton Steel 8,550 5,729 ---------- 5,729 ---------- Real Estate - 2.36% Equity Inns Series B 8.75% 10,000 250,000 LaSalle Hotel Properties 10.25% 23,500 629,564 Ramco-Gershenson Properties 9.50% 11,500 305,038 SL Green Realty 7.625% 22,000 541,750 ---------- 1,726,352 ---------- Utilities - 0.61% Public Service Enterprise Group 10.25% 6,800 392,700 TNP Enterprises PIK 14.50% 468 54,185 ---------- 446,885 ---------- TOTAL PREFERRED STOCK (cost $2,520,930) 2,575,862 ---------- Principal Amount*** CONVERTIBLE BONDS - 3.48% Computers & Technology - 0.37% +Mercury Interactive 144A 4.75% 7/1/07 USD 275,000 272,250 ------------- 272,250 ------------- Leisure, Lodging & Entertainment - 0.20% *+Regal Entertainment Group 144A 3.75% 5/15/08 USD 130,000 149,825 ------------- 149,825 ------------- Miscellaneous - 0.19% +Tyco International Group 144A 2.75% 1/15/18 USD 100,000 142,500 ------------- 142,500 ------------- Real Estate - 0.49% Meristar Hospitality 9.50% 4/1/10 USD 300,000 359,625 ------------- 359,625 ------------- Retail - 1.24% +Gap 144A 5.75% 3/15/09 USD 500,000 778,750 +Saks 144A 2.00% 3/15/24 USD 125,000 126,406 ------------- 905,156 ------------- Telecommunications - 0.62% +Nextel Partners 144A 1.50% 11/15/08 USD 200,000 452,250 ------------- 452,250 ------------- Transportation & Shipping - 0.07% +ExpressJet Holdings 144A 4.25% 8/1/23 USD 50,000 48,250 ------------- 48,250 ------------- Utilities - 0.30% +Centerpoint Energy 144A 3.75% 5/15/23 USD 200,000 221,000 ------------- 221,000 ------------- TOTAL CONVERTIBLE BONDS (cost $1,879,663) 2,550,856 -------------
2 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS (CONTINUED)
Principal Market Amount*** Value (U.S.$) BONDS - 41.53% Aerospace & Defense - 0.10% Armor Holdings 8.25% 8/15/13 USD 70,000 $ 75,075 ---------- 75,075 ---------- Agency - 1.57% Fannie Mae Global 2.125% 10/9/07 JPY 120,000,000 1,147,602 ---------- 1,147,602 ---------- Automobiles & Automotive Parts - 0.22% #+Advanced Accessory Holdings 144A 13.25% 12/15/11 USD 130,000 69,550 Advanced Accessory Systems 10.75% 6/15/11 USD 40,000 40,400 *Collins & Aikman Products 11.50% 4/15/06 USD 50,000 48,750 ---------- 158,700 ---------- Banking, Finance & Insurance - 2.70% BF Saul 7.50% 3/1/14 USD 25,000 24,688 *Bluewater Finance 10.25% 2/15/12 USD 60,000 61,800 +Farmers Exchange Capital 144A 7.20% 7/15/48 USD 70,000 65,240 +LaBranche 144A 11.00% 5/15/12 USD 80,000 82,000 Oesterreichische Kontrollbank 1.80% 3/22/10 JPY 150,000,000 1,439,145 ^SL Finance 6.375% 7/12/22 EUR 80,000 104,528 Stena 9.625% 12/1/12 USD 90,000 101,250 *+UGS 144A 10.00% 6/1/12 USD 30,000 31,650 ^Zurich Finance 5.75% 10/2/23 EUR 50,000 62,941 ---------- 1,973,242 ---------- Buildings & Materials - 0.43% +Aearo 144A 8.25% 4/15/12 USD 40,000 40,600 Interface 10.375% 2/1/10 USD 75,000 83,625 *Interline Brands 11.50% 5/15/11 USD 75,000 80,250 +Lone Star Industries 144A 8.85% 6/15/05 USD 60,000 62,706 Standard Pacific 7.75% 3/15/13 USD 50,000 50,000 ---------- 317,181 ---------- Business Services - 0.08% Brickman Group 11.75% 12/15/09 USD 50,000 57,250 ---------- 57,250 ---------- Cable, Media & Publishing - 1.75% +Atlantic Broadband Finance 144A 9.375% 1/15/14 USD 125,000 117,500 *Charter Communications 10.75% 10/1/09 USD 250,000 218,749 CSC Holdings 10.50% 5/15/16 USD 135,000 152,888 Dex Media East 12.125% 11/15/12 USD 45,000 52,425 +Echostar DBS 144A 5.75% 10/1/08 USD 115,000 112,988 +Hollinger 144A 11.875% 3/1/11 USD 40,000 45,650 *Lodgenet Entertainment 9.50% 6/15/13 USD 90,000 98,550 PanAmSat 8.50% 2/1/12 USD 75,000 84,375 PEI Holdings 11.00% 3/15/10 USD 85,000 98,175 Rogers Cablesystems 10.00% 3/15/05 USD 100,000 105,500 +Sheridan Acquisition 144A 10.25% 8/15/11 USD 65,000 68,575 XM Satellite Radio 12.00% 6/15/10 USD 115,000 129,375 ---------- 1,284,750 ----------
Principal Market Amount*** Value (U.S.$) BONDS (continued) Chemicals - 0.60% Huntsman International 9.875% 3/1/09 USD 50,000 $ 54,250 10.125% 7/1/09 USD 90,000 92,700 *+Nalco 144A 8.875% 11/15/13 USD 55,000 57,750 *Resolution Performance Products 8.00% 12/15/09 USD 50,000 51,625 *+Rhodia 144A 8.875% 6/1/11 USD 125,000 96,250 *[check mark]Solutia 6.72% 10/15/37 USD 175,000 84,875 -------- 437,450 -------- Computers & Technology - 0.45% Activant Solutions 10.50% 6/15/11 USD 45,000 47,475 *Amkor Technology 9.25% 2/15/08 USD 85,000 89,888 ChipPac International 12.75% 8/1/09 USD 55,000 60,225 Northern Telecom Capital 7.875% 6/15/26 USD 85,000 73,950 +Stratus Technologies 144A 10.375% 12/1/08 USD 60,000 59,100 -------- 330,638 -------- Consumer Products - 0.34% Hines Nurseries 10.25% 10/1/11 USD 40,000 42,800 Remington Arms 10.50% 2/1/11 USD 75,000 72,750 +Samsonite 144A 8.875% 6/1/11 USD 60,000 60,900 #+Town Sports International 144A 11.00% 2/1/14 USD 150,000 74,250 -------- 250,700 -------- Consumer Services - 0.17% Alderwoods Group 12.25% 1/2/09 USD 100,000 111,000 Corrections Corporation of America 9.875% 5/1/09 USD 15,000 16,650 -------- 127,650 -------- Energy - 0.48% El Paso Production Holding 7.75% 6/1/13 USD 115,000 109,250 +Hilcorp Energy/Finance 144A 10.50% 9/1/10 USD 85,000 93,288 Petroleum Geo-Services 8.00% 11/5/06 USD 40,031 40,832 10.00% 11/5/10 USD 104,981 108,130 -------- 351,500 -------- Environmental Services - 0.28% +Geo 144A 11.00% 5/15/12 USD 80,000 81,400 IESI 10.25% 6/15/12 USD 115,000 124,775 -------- 206,175 -------- Food, Beverage & Tobacco - 0.96% B&G Foods 9.625% 8/1/07 USD 195,000 199,387 Chiquita Brands International 10.56% 3/15/09 USD 100,000 109,125 +Commonwealth Brands 144A 10.625% 9/1/08 USD 90,000 93,150 +Gold Kist 144A 10.25% 3/15/14 USD 35,000 36,750 +Le-Natures 144A 9.50% 6/15/13 USD 85,000 87,125 National Beef Packing 10.50% 8/1/11 USD 35,000 37,625 PPC Escrow 9.25% 11/15/13 USD 60,000 62,700 *+Standard Commercial 144A 8.00% 4/15/12 USD 75,000 76,875
3 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS (CONTINUED)
Principal Market Amount*** Value (U.S.$) BONDS (continued) Food, Beverage & Tobacco (continued) [check mark]Venture Holdings Trust 12.00% 6/1/09 USD 95,000 $ 594 ---------- 703,331 ---------- Foreign Government - 23.24% Belgium Government 5.75% 9/28/10 EUR 1,100,000 1,482,444 Canadian Government 0.70% 3/20/06 JPY 150,000,000 1,369,606 Deutschland Republic 5.00% 7/4/11 EUR 890,000 1,154,053 6.25% 1/4/24 EUR 350,000 501,532 France Government Bond O.A.T. 4.00% 10/25/09 EUR 210,000 260,658 4.00% 4/25/13 EUR 1,200,000 1,440,178 5.50% 4/25/10 EUR 1,000,000 1,331,900 Hellenic Republic 8.60% 3/26/08 EUR 200,000 289,767 Kingdom of Spain 3.10% 9/20/06 JPY 45,000,000 433,024 Poland Government 5.00% 10/24/13 PLZ 6,000,000 1,336,671 6.00% 5/24/09 PLZ 500,000 123,666 8.50% 2/12/05 PLZ 1,200,000 319,537 Queensland Treasury 6.00% 7/14/09 AUD 1,300,000 935,096 6.00% 8/14/13 AUD 1,500,000 1,064,855 Republic of Austria 4.00% 7/15/09 EUR 450,000 559,429 Republic of Italy 0.375% 10/10/06 JPY 70,000,000 634,252 3.75% 6/8/05 JPY 41,000,000 384,572 Swedish Government 5.00% 1/28/09 SEK 6,700,000 939,434 5.50% 10/8/12 SEK 5,000,000 715,812 6.75% 5/5/14 SEK 4,750,000 741,791 U.K. Treasury 5.75% 12/7/09 GBP 350,000 660,076 8.00% 12/7/15 GBP 150,000 343,557 ---------- 17,021,910 ---------- Healthcare & Pharmaceuticals - 0.23% +Ameripath 144A 10.50% 4/1/13 USD 90,000 90,900 +Curative Health Services 144A 10.75% 5/1/11 USD 55,000 53,900 +VWR International 144A 8.00% 4/15/14 USD 25,000 25,188 ---------- 169,988 ---------- Industrial Machinery - 0.16% *Foster Wheeler 6.75% 11/15/05 USD 60,000 54,600 +MAAX 144A 9.75% 6/15/12 USD 60,000 61,800 ---------- 116,400 ---------- Leisure, Lodging & Entertainment - 1.41% Ameristar Casinos 10.75% 2/15/09 USD 80,000 91,600 +Aztar 144A 7.875% 6/15/14 USD 145,000 146,087 Felcor Lodging 10.00% 9/15/08 USD 60,000 64,350 Hard Rock Hotel 8.875% 6/1/13 USD 60,000 60,900 Herbst Gaming 10.75% 9/1/08 USD 65,000 75,075 +144A 8.125% 6/1/12 USD 130,000 130,975 Mandalay Resort Group 10.25% 8/1/07 USD 15,000 16,875 Penn National Gaming 8.875% 3/15/10 USD 85,000 91,375 Royal Caribbean Cruises 7.25% 3/15/18 USD 95,000 91,200
Principal Market Amount*** Value (U.S.$) BONDS (continued) Leisure, Lodging & Entertainment (continued) Station Casinos 6.50% 2/1/14 USD 40,000 $ 37,500 +Warner Music Group 144A 7.375% 4/15/14 USD 140,000 137,200 Wheeling Island Gaming 10.125% 12/15/09 USD 85,000 89,888 ------------- 1,033,025 ------------- Metals & Mining - 0.47% AK Steel 7.75% 6/15/12 USD 70,000 61,600 +Autocam 144A 10.875% 6/15/14 USD 85,000 83,938 +Ispat Inland 144A 9.75% 4/1/14 USD 100,000 102,750 *[check mark]#Weirton Steel 0.50% 4/1/08 USD 522,500 99,275 ------------- 347,563 ------------- Packaging & Containers - 0.57% AEP Industries 9.875% 11/15/07 USD 50,000 51,250 Consolidated Container 10.125% 7/15/09 USD 80,000 70,800 #+144A 10.75% 6/15/09 USD 80,000 60,000 Pliant 11.125% 9/1/09 USD 55,000 58,575 *+Portola Packaging 144A 8.25% 2/1/12 USD 80,000 67,200 Radnor Holdings *11.00% 3/15/10 USD 60,000 51,900 ^+144A 7.92% 4/15/09 USD 60,000 60,300 ------------- 420,025 ------------- Paper & Forest Products - 1.15% Abitibi-Consolidated 6.95% 12/15/06 USD 55,000 56,592 +Ainsworth Lumber 144A 6.75% 3/15/14 USD 65,000 60,288 Bowater 9.00% 8/1/09 USD 100,000 108,794 *Buckeye Technologies 8.00% 10/15/10 USD 95,000 88,825 Fort James 7.75% 11/15/23 USD 235,000 242,050 *+Newark Group 144A 9.75% 3/15/14 USD 95,000 90,250 +Port Townsend Paper 144A 11.00% 4/15/11 USD 85,000 84,150 Potlatch 12.50% 12/1/09 USD 95,000 114,207 ------------- 845,156 ------------- Real Estate - 0.19% Tanger Properties 7.875% 10/24/04 USD 60,000 60,900 9.125% 2/15/08 USD 70,000 77,175 ------------- 138,075 ------------- Restaurants - 0.31% [check mark]Avado Brands 9.75% 6/1/06 USD 45,000 18,000 Denny's 12.75% 9/30/07 USD 65,000 68,575 +O'Charleys 144A 9.00% 11/1/13 USD 80,000 82,400 +VICORP Restaurants 144A 10.50% 4/15/11 USD 60,000 59,700 ------------- 228,675 ------------- Retail - 0.37% *J Crew Operating 10.375% 10/15/07 USD 100,000 100,500 *Office Depot 10.00% 7/15/08 USD 100,000 116,000 Petco Animal Supplies 10.75% 11/1/11 USD 45,000 51,075 ------------- 267,575 ------------- Telecommunications - 0.71% Alaska Communications Systems 9.875% 8/15/11 USD 75,000 76,875
4 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS (CONTINUED)
Principal Market Amount*** Value (U.S.$) BONDS (continued) Telecommunications (continued) Centennial Cellular Operating 10.125% 6/15/13 USD 95,000 $ 97,375 Cincinnati Bell 8.375% 1/15/14 USD 55,000 49,500 Citizens Communications 8.50% 5/15/06 USD 20,000 21,359 +Inmarsat Finance 144A 7.625% 6/30/12 USD 30,000 29,775 +iPCS Escrow 144A 11.50% 5/1/12 USD 40,000 40,600 *MetroPCS 10.75% 10/1/11 USD 80,000 85,600 *+Qwest Services 144A 13.50% 12/15/10 USD 105,000 121,538 ----------- 522,622 ----------- Textiles, Apparel & Furniture - 0.15% Warnaco 8.875% 6/15/13 USD 100,000 106,250 ----------- 106,250 ----------- Transportation & Shipping - 0.69% Hornbeck Offshore Services 10.625% 8/1/08 USD 50,000 54,750 *Kansas City Southern Railway 9.50% 10/1/08 USD 150,000 164,250 Ocean Rig Norway 10.25% 6/1/08 USD 65,000 64,675 OMI 7.625% 12/1/13 USD 80,000 78,000 Overseas Shipholding Group 8.25% 3/15/13 USD 35,000 37,669 Seabulk International 9.50% 8/15/13 USD 100,000 103,125 ---------- 502,469 ---------- Utilities - 1.75% Avista 9.75% 6/1/08 USD 100,000 119,059 Calpine *8.25% 8/15/05 USD 25,000 21,750 10.50% 5/15/06 USD 110,000 85,250 *+144A 8.75% 7/15/13 USD 120,000 100,500 Cogentrix Energy 8.75% 10/15/08 USD 85,000 88,613 *+Dynegy Holdings 144A 10.125% 7/15/13 USD 150,000 159,749 Edison Mission 9.875% 4/15/11 USD 45,000 45,450 El Paso Natural Gas 7.625% 8/1/10 USD 45,000 45,675 Elwood Energy 8.159% 7/5/26 USD 32,040 32,361 Midland Funding II 11.75% 7/23/05 USD 27,493 28,456 Midwest Generation 8.30% 7/2/09 USD 100,000 100,000 +144A 8.75% 5/1/34 USD 90,000 89,100 [chechmark]Mirant Americas Generation 7.625% 5/1/06 USD 80,000 57,200 +NRG Energy 144A 8.00% 12/15/13 USD 15,000 15,038 Orion Power Holdings 12.00% 5/1/10 USD 50,000 61,750 PSEG Energy Holdings 7.75% 4/16/07 USD 50,000 52,250 Reliant Energy 9.50% 7/15/13 USD 50,000 53,250 Sonat 6.875% 6/1/05 USD 40,000 40,000 Tennessee Gas Pipeline 8.375% 6/15/32 USD 70,000 67,900 [chechmark]+USGen New England 144A 7.459% 1/2/15 USD 50,000 21,250 ---------- 1,284,601 ---------- TOTAL BONDS (cost $29,158,166) 30,425,578 ----------
Principal Market Amount*** Value (U.S.$) MUNICIPAL BONDS - 0.06% New Jersey Economic Development Authority Special Facility Revenue Continental Airlines Project 6.25% 9/15/29 USD 60,000 $ 44,005 ---------- TOTAL MUNICIPAL BONDS (cost $50,900) 44,005 ---------- Number of Shares WARRANTS - 0.01% +++American Tower 144A 35 6,125 +++Solutia 144A 130 1 ---------- TOTAL WARRANTS (cost $13,894) 6,126 ---------- Principal Amount*** U.S. TREASURY OBLIGATIONS - 10.74% [solid box]U.S. Treasury Bills 0.90% 7/22/04 USD 7,880,000 7,869,897 ---------- TOTAL U.S. TREASURY OBLIGATIONS (cost $7,869,897) 7,869,897 ---------- TOTAL MARKET VALUE OF SECURITIES BEFORE SECURITIES LENDING COLLATERAL - 134.65% (cost $86,893,038) 98,652,048 ---------- SECURITIES LENDING COLLATERAL+++ - 4.98% Abbey National 1.10% 6/07/04 USD 67,458 67,457 1.190% 10/15/04 USD 62,364 63,936 ABN AMRO Bank Chicago 1.07% 6/07/04 USD 94,291 94,291 ABN AMRO Bank Tokyo 1.10% 7/20/04 USD 67,353 67,352 Barclays 1.10% 8/19/04 USD 102,394 102,381 Bayerische Landesbank 1.154% 8/30/04 USD 53,870 53,873 CDC IXIS 1.485% 11/12/04 USD 107,750 107,764 Citibank 1.06% 7/06/04 USD 107,764 107,764 Citigroup Global Markets 1.04% 6/01/04 USD 1,104,504 1,104,504 Credit Suisse First Boston 1.60% 12/13/04 USD 107,736 107,764 Deutsche Bank Financial 1.33% 2/22/05 USD 26,936 26,961 Fortis Bank 1.10% 7/26/04 USD 135,628 135,662 General Electric Capital 1.103% 10/25/04 USD 45,819 45,871 1.118% 2/3/05 USD 40,412 40,468 1.132% 10/04/04 USD 40,417 40,450 Goldman Sachs Group 1.14% 7/20/04 USD 107,759 107,764 1.245% 12/08/04 USD 63,311 63,311 ING Bank Geneva 1.10% 9/30/04 USD 107,837 107,764 ING Bank Singapore 1.06% 6/03/04 USD 53,882 53,882 Marsh & McLennan 1.291% 6/15/04 USD 68,988 69,133 Merrill Lynch Mortgage Capital 1.163% 7/12/04 USD 107,764 107,764 Morgan Stanley Dean Witter 1.22% 6/28/05 USD 26,941 26,941 Rabobank 1.065% 3/02/05 USD 134,703 134,671 Royal Bank of Scotland 1.06% 7/02/04 USD 134,748 134,747
5 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF NET ASSETS (CONTINUED)
Principal Market Amount*** Value (U.S.$) SECURITIES LENDING COLLATERAL (continued) Societe Generale New York 1.148% 12/08/04 USD 107,743 $ 107,743 Societe Generale Singapore 1.06% 6/03/04 USD 53,882 53,882 Svenska Stockholm 1.10% 8/09/04 USD 134,719 134,705 Union Bank of Switzerland 1.13% 12/20/04 USD 135,016 134,705 Wachovia Bank NA 1.127% 11/15/04 USD 107,766 107,810 Wells Fargo Bank 1.04% 6/30/04 USD 134,705 134,705 ------------ TOTAL SECURITIES LENDING COLLATERAL (cost $3,646,025) 3,646,025 ------------ TOTAL MARKET VALUE OF SECURITIES - 139.63% (cost $90,539,063) 102,298,073** OBLIGATION TO RETURN SECURITIES LENDING COLLATERAL - (4.98%)+++ (3,646,025) BORROWING UNDER LINE OF CREDIT - (34.12%) (25,000,000) LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.53%) (385,029) ------------ NET ASSETS APPLICABLE TO 5,985,582 SHARES OUTSTANDING; EQUIVALENT TO $12.24 PER SHARE - 100.00% $ 73,267,019 ------------
COMPONENTS OF NET ASSETS AT MAY 31, 2004(A): Common stock, $0.01 par value, 500,000,000 shares authorized to the Fund $74,022,219 Treasury stock, 665,065 shares at cost (8,599,291) Accumulated net realized loss on investments (3,919,665) Net unrealized appreciation of investments 11,763,756 ----------- Total net assets $73,267,019 ----------- *Fully or partially on loan. **Includes $3,607,479 of securities loaned. ***Principal amount is stated in the currency in which each bond is denominated. AUD - Australian Dollar EUR - European Monetary Unit GBP - British Pound Sterling JPY - Japanese Yen PLZ - Polish Zloty SEK - Swedish Krona USD - U.S. Dollar + Security exempt from registration under Rule 144A of the Securities Act of 1933. See Note 10 in "Notes to Financial Statements." ++ Non-income producing security for the period ended May 31, 2004. +++ See Note 8 in "Notes to Financial Statements." [check mark] Non-income producing security. Security is currently in default. # Step coupon bond. [Solid Box] 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. ^ Variable Rate Notes - the interest rate shown is the rate as of May 31, 2004. (a) See Note 4 in "Notes to Financial Statements." SUMMARY OF ABBREVIATIONS: ADR - American Depositary Receipt PIK - Pay-in-kind See accompanying notes 6 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF OPERATIONS Six Months Ended May 31, 2004 (Unaudited)
INVESTMENT INCOME: Dividends $ 1,030,271 Interest 986,461 Securities lending income 6,715 Foreign tax withheld (52,021) $ 1,971,426 ----------- ----------- EXPENSES: Management fees 347,994 Accounting and administration expenses 50,000 Legal and professional fees 31,820 Reports to shareholders 23,468 NYSE fees 13,240 Custodian fees 12,183 Transfer agent fees 11,274 Taxes (other than taxes on income) 7,200 Directors' fees 4,193 Other 4,308 ----------- Total operating expenses (before interest expense) 505,680 Interest expense 190,873 ----------- Total operating expenses (after interest expense) 696,553 Less expenses paid indirectly (603) ----------- Total expenses 695,950 ----------- NET INVESTMENT INCOME 1,275,476 ----------- NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCIES: Net realized gain on: Investments 1,927,831 Foreign currencies 453,809 ----------- Net realized gain 2,381,640 Net change in unrealized appreciation/depreciation of investments and foreign currencies 791,093 ----------- NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCIES 3,172,733 ----------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 4,448,209 ===========
See accompanying notes 7 STATEMENTS DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF CHANGES IN NET ASSETS
Six Months Year Ended Ended 5/31/04 11/30/03 (Unaudited) INCREASE IN NET ASSETS FROM OPERATIONS: Net investment income $ 1,275,476 $ 3,318,501 Net realized gain on investments and foreign currencies 2,381,640 1,457,350 Net change in unrealized appreciation/depreciation of investments and foreign currencies 791,093 13,881,480 ----------- ----------- Net increase in net assets resulting from operations 4,448,209 18,657,331 ----------- ----------- DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM(1): Net investment income (1,717,448) (5,492,967) Return of capital (1,156,651) (994,113) ----------- ----------- (2,874,099) (6,487,080) ----------- ----------- NET INCREASE IN NET ASSETS 1,574,110 12,170,251 NET ASSETS: Beginning of period 71,692,909 59,522,658 ----------- ----------- End of period (including undistributed net investment income for financial reporting purposes of $--and $31,885, respectively) $73,267,019 $71,692,909 =========== ===========
(1) See Note 4 in "Notes to Financial Statements." See accompanying notes 8 STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. OF CASH FLOWS Six Months Ended May 31, 2004 (Unaudited)
NET CASH (INCLUDING FOREIGN CURRENCY) PROVIDED BY OPERATING ACTIVITIES: Net increase in net assets resulting from operations $4,448,209 ----------- Adjustments to reconcile net increase in net assets from operations to cash provided by operating activities: Amortization of premium and discount on investments (28,612) Net proceeds from investment transactions (2,419,072) Net realized gain on investment transactions (1,927,831) Net realized gain on foreign currencies (453,809) Net change in unrealized appreciation/depreciation of investments and foreign currencies (791,093) Increase in receivable for investments sold (188,839) Decrease in interest and dividends receivable 51,666 Increase in payable for investments purchased 353,966 Decrease in interest payable (5,744) Decrease in distribution payable (478,282) Decrease in accrued expenses and other liabilities (6,300) ----------- Total adjustments (5,893,950) ----------- Net cash provided by operating activities (1,445,741) ----------- CASH FLOWS USED FOR FINANCING ACTIVITIES: Increase in principal on line of credit 4,000,000 Cash dividends and distributions paid (2,874,099) ----------- Net cash used for financing activities 1,125,901 ----------- Effect of exchange rates on cash (142,781) ----------- Net decrease in cash (462,621) Cash (overdraft) at beginning of period (25,250) ----------- Cash (overdraft) at end of period $ (487,871) =========== Cash paid for interest $ 196,812 ===========
See accompanying notes 9 FINANCIAL HIGHLIGHTS Selected data for each share of the Fund outstanding throughout each period were as follows:
- ---------------------------------------------------------------------------------------------------------------------------- Delaware Investments Global Dividend and Income Fund, Inc. - ---------------------------------------------------------------------------------------------------------------------------- Six Months Ended Year Ended 5/31/04(1) 11/30/03 11/30/02(4) 11/30/01 11/30/00 11/30/99 (Unaudited) NET ASSET VALUE, BEGINNING OF PERIOD $ 11.980 $ 9.940 $ 11.170 $ 11.770 $ 13.920 $ 15.700 INCOME (LOSS) FROM INVESTMENT OPERATIONS: Net investment income(5) 0.213 0.554 0.499 0.620 0.700 0.930 Net realized and unrealized gain (loss) on investments and foreign currencies 0.527 2.570 (0.260) 0.280 (1.350) (1.070) -------- -------- -------- -------- ------ -------- Total from investment operations 0.740 3.124 0.239 0.900 (0.650) (0.140) -------- -------- -------- -------- ------ -------- LESS DIVIDENDS AND DISTRIBUTIONS FROM(6): Net investment income (0.287) (0.918) (0.365) (0.195) (0.530) (0.860) Net realized gain on investments -- -- -- (0.084) (0.470) (0.780) Return of capital (0.193) (0.166) (1.104) (1.221) (0.500) -- -------- -------- -------- -------- -------- -------- Total dividends and distributions (0.480) (1.084) (1.469) (1.500) (1.500) (1.640) -------- -------- -------- -------- -------- -------- NET ASSET VALUE, END OF PERIOD 12.240 $ 11.980 $4 9.940 $ 11.170 $ 11.770 $ 13.920 ======== ======== ======== ======== ======== ======== MARKET VALUE, END OF PERIOD $ 11.240 $ 11.900 $ 10.400 $ 12.400 $ 10.380 $ 11.750 ======== ======== ======== ======== ======== ======== TOTAL RETURN BASED ON:(2) Market value (1.72%) 25.92% (5.49%) 34.52% 0.29% (17.00%) Net asset value 6.31% 32.63% 0.28% 6.91% (4.04%) (0.57%) RATIOS AND SUPPLEMENTAL DATA: Net assets, end of period (000 omitted) $ 73,267 $ 71,693 $ 59,523 $ 66,870 $ 70,420 $ 92,601 Ratio of expenses to average net assets 1.85% 2.04% 2.26% 3.31% 3.45% 2.69% Ratio of expenses to adjusted average net assets (before interest expense)(3) 1.02% 1.08% 1.06% 1.10% 1.04% 1.00% Ratio of interest expense to adjusted average net assets(3) 0.39% 0.46% 0.64% 1.35% 1.62% 1.15% Ratio of net investment income to average net assets 3.39% 5.14% 4.69% 5.18% 5.34% 6.14% Ratio of net investment income to adjusted average net assets(3) 2.58% 3.88% 3.53% 3.84% 4.11% 4.92% Portfolio turnover 71% 99% 69% 47% 43% 58% LEVERAGE ANALYSIS: Debt outstanding at end of period (000 omitted) $ 25,000 $ 21,000 $ 21,000 $ 25,000 $ 25,000 $ 25,000 Average daily balance of debt outstanding (000 omitted) $ 23,842 $ 21,000 $ 21,603 $ 25,000 $ 25,000 $ 25,000 Average daily balance of shares outstanding (000 omitted) 5,986 5,986 5,986 5,986 6,389 6,651 Average debt per share $ 3.98 $ 3.51 $ 3.61 $ 4.18 $ 3.91 $ 3.76 Asset coverage per $1,000 of debt outstanding at end of period $3,931 $ 4,414 $ 3,834 $ 3,675 $ 3,817 $ 4,704
(1) Ratios and portfolio turnover have been annualized and total return has not been annualized. (2) 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, if any, are assumed for the purpose 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 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. (3) Adjusted average net assets excludes debt outstanding. (4) As required, effective December 1, 2001, the Fund adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies that requires amortization of all premium and discounts on debt securities. The effect of this change for the year ended November 30, 2002 was a decrease in net investment income per share of $0.024, an increase in net realized and unrealized gain (loss) per share of $0.024, a decrease in the ratio of net investment income to average net assets of 0.23%, and a decrease in the ratio of net investment income to adjusted net assets of 0.17%. Per share data and ratios for the periods prior to December 1, 2001 have not been restated to reflect this change in accounting. (5) The average shares outstanding method has been applied for per share information. (6) See Note 4 in "Notes to Financial Statements." See accompanying notes 10 DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. May 31, 2004 (Unaudited) NOTES TO FINANCIAL STATEMENTS 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 under the symbol DGF. 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 U.S. generally accepted accounting principles and are consistently followed by the Fund. Security Valuation - Equity securities, except those traded on the Nasdaq Stock Market, Inc. (NASDAQ), are valued at the last quoted sales price as of time of the regular close of the New York Stock Exchange (NYSE) on the valuation date. Securities traded on the NASDAQ are valued in accordance with the NASDAQ Official Closing Price, which may not be the last sales price. 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 normally valued at the last quoted sales price before the Fund is valued. If on a particular day a security does not trade, then the mean between the bid and the asked prices will normally be used. U.S. government and agency securities are valued at the mean between the bid and asked prices. 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. 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. Other securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith under the direction of the Fund's Board of Directors. In determining whether market quotations are readily available or fair valuation will be used, various factors will be taken into consideration, such as market closures, or with respect to foreign securities, aftermarket trading or significant events after local market trading (e.g., government actions or pronouncements, trading volume or volatility on markets, exchanges among dealers, or news events). 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 - The Fund has a managed distribution policy. Under the policy, the Fund declares and pays monthly distributions 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. The current annualized rate is $0.96 per share. The Fund continues to evaluate its monthly distribution in light of ongoing economic and market conditions and may change the amount of the monthly distributions in the future. Foreign Currency Transactions - Transactions denominated in foreign currencies are recorded at the prevailing exchange rates on the valuation date. The values 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. The Fund isolates that portion of realized 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. For foreign equity securities, these changes are included in realized gains (losses) on investments. 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. Use of Estimates - The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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. Management fees and other expenses are paid monthly. 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. Discounts and premiums 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 recorded in accordance with the Fund's understanding of the applicable country's tax rules and rates. Distributions received from investments in Real Estate Investment Trusts are recorded as dividend income on ex-dividend date, subject to reclassification upon notice of the character of such distributions by the issuer. Through March 31, 2004, certain expenses of the Fund were paid through commission arrangements with brokers. The amount of these expenses was approximately $603 for the six months ended May 31, 2004. The expense paid under the above arrangement is included in "other" on the Statement of Operations with the corresponding expense offset shown as "expenses paid indirectly." 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. Adjusted average weekly net assets does not include the line of credit liability. 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 which is equal to 40% of the of the fee paid to DMC under the terms of the investment management agreement. The Fund does not pay any fees directly to DIAL. DIAL is being acquired by a venture comprised of certain members of DIAL's management and a private equity firm, Hellman & Friedman, LLC. This transaction is expected to close late in the third quarter or early in the fourth quarter of this year (the "Closing"). Under applicable law, DIAL's Sub-Advisory Agreement for the Fund will automatically terminate as of the Closing. DMC has informed the Board of Directors of the Fund that it will not seek to continue the Sub-Advisory Agreement with DIAL after the Closing and if deemed appropriate, may terminate the Sub-Advisory Agreement prior to the Closing. The Board was informed that upon termination of the Sub-Advisory Agreement, DMC would assume responsibility for the day-to-day management of the assets formerly managed by 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 average weekly net assets, subject to an annual minimum of $100,000. 11 NOTES DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. TO FINANCIAL STATEMENTS (CONTINUED) 2. INVESTMENT MANAGEMENT, ADMINISTRATION AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED) At May 31, 2004, the Fund had liabilities payable to affiliates as follows: Investment management fee payable to DMC $56,198 Accounting and administration fees and other expenses payable to DSC 37,339 Other expense payable to DMC and affiliates* 2,903 *DMC, as part of its administration services, pays operating expenses on behalf of the Fund and is reimbursed on a periodic basis. Such expenses include items such as printing of shareholder reports, fees for audit, legal and tax services, stock exchange fees, custodian fees and directors fees. As provided in the investment management agreement, the Fund bears the cost of certain legal services expenses, including in house legal services provided to the Fund by DMC employees. For the six months ended May 31, 2004, the Fund had costs of $2,327. 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 six months ended May 31, 2004, the Fund made purchases of $33,976,417 and sales of $31,963,696 of investment securities other than U.S. government securities and short-term investments. At May 31, 2004, the cost of investments for federal income taxes purposes has been estimated since the final tax characteristics cannot be determined until fiscal year end. At May 31, 2004, the cost of investments was $86,869,734. At May 31, 2004, the net unrealized appreciation was $11,782,314 of which $14,180,405 related to unrealized appreciation of investments and $2,398,091 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 U.S. generally accepted accounting principles. The tax character of dividends and distributions paid during the six months ended May 31, 2004 and the year ended November 30, 2003, was as follows: Six Months Year Ended Ended 5/31/04* 11/30/03 ---------- -------- Ordinary income $1,717,448 $5,492,967 Return of capital 1,156,651 994,113 ---------- ---------- Total $2,874,099 $6,487,080 ========== ========== *Tax information for the six months ended May 31, 2004 is an estimate and the tax character of dividends and distributions may be redesignated at fiscal year end. The components of net assets for federal income tax purposes are estimated since final tax characteristics cannot be determined until fiscal year end. As of May 31, 2004, the estimated components of net assets on a tax basis were as follows: Shares of beneficial interest $65,422,928 Capital loss carryforwards (3,942,969) Unrealized appreciation of investments and foreign currencies 11,787,060 ----------- Net assets $73,267,019 =========== The differences between book basis and tax basis components of net assets are primarily attributable to tax deferral of losses on wash sales and tax treatment of market discount and premium on debt instruments. For financial reporting purposes, capital accounts and distributions to shareholders are adjusted to reflect the tax character of book/tax differences. For the six months ended May 31, 2004, the Fund recorded an estimate of these differences since the final tax characteristics cannot be determined until fiscal year end. Reclassifications are primarily due to tax treatment of gain (loss) or foreign currency transactions and market discount and premium on certain debt instruments. Results of operations and net assets were not affected by these reclassifications. Undistributed net investment income $ 1,232,775 Accumulated realized gain (loss) (76,124) ----------- Paid in capital $ 1,156,651 =========== At November 30, 2003, for federal income tax purposes, the Fund had capital loss carryforwards of $5,802,012 which may be carried forward and applied against future capital gains. Such capital loss carryforwards expire as follows: $1,093,240 expires in 2009, $3,986,959 expires in 2010 and $721,813 expires in 2011. For the six months ended May 31, 2004, the Fund had capital gains of $1,859,043, which may be offset by the capital loss carryforwards. 5. CAPITAL STOCK The Fund did not have any transactions in common shares during the six months ended May 31, 2004. 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. 6. LINE OF CREDIT The Fund has entered into a Line of Credit Agreement with J.P. Morgan Chase for $25,000,000 that expires on January 20, 2005. At May 31, 2004, the par value of loans outstanding was $25,000,000 at a variable interest rate of 1.65%. During the six months ended May 31, 2004, the average daily balance of loans outstanding was $23,841,530 at a weighted average interest rate of approximately 1.64%. The maximum amount of loans outstanding at any time during the six months ended May 31, 2004 was $25,000,000. Interest on borrowings is based on market rates in effect at the time of borrowing. The commitment fee is computed at a rate of 0.15% per annum on the unused balance. For the six months ended May 31, 2004, the Fund was charged a commitment fee of $1,533 which is included in "custodian fees" on the Statement of Operations. The loan is collateralized by the Fund's portfolio. 7. FOREIGN EXCHANGE CONTRACTS The Fund may enter into forward foreign currency exchange contracts 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. 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 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. 12 NOTES DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC. TO FINANCIAL STATEMENTS (CONTINUED) 7. FOREIGN EXCHANGE CONTRACTS (CONTINUED) The following foreign currency exchange contracts were outstanding at May 31, 2004:
Settlement Unrealized Contracts to Deliver In Exchange for Date Depreciation - -------------------- --------------- -------------- ------------ 555,000 $987,345 7/30/04 ($24,331) British Pounds 1,520,000 $2,675,200 7/30/04 ($95,515) British Pounds --------- ($119,846) =========
8. SECURITIES LENDING The Fund, along with other funds in the Delaware Investments Family of Funds, may lend its securities pursuant to a security lending agreement (Lending Agreement) with J.P. Morgan Chase. Initial security loans made pursuant to the Lending Agreement are required to be secured by U.S. government obligations and/or cash collateral not less than 102% of the market value of the securities issued in the United States and 105% of the market value of securities issued outside the United States. With respect to each loan, if the aggregate market value of the collateral held on any business day is less than the aggregate market value of the securities which are the subject of such loan, the borrower will be notified to provide additional collateral not less than the applicable collateral requirements. Cash collateral received is invested in fixed-income securities, with a weighted average maturity not to exceed 90 days, rated in one of the top two tiers by Standard & Poor's Ratings Group or Moody's Investors Service, Inc. or repurchase agreements collateralized by such securities. However, in the event of default or bankruptcy by the lending agent, realization and/or retention of the collateral may be subject to legal proceedings. In the event the borrower fails to return loaned securities and the collateral received is insufficient to cover the value of the loaned securities and provided such collateral shortfall is not the result of investment losses, the lending agent has agreed to pay the amount of the shortfall to the Fund, or at the discretion of the lending agent, replace the loaned securities. The Fund continues to record dividends on the securities loaned and is subject to change in fair value of the securities loaned that may occur during the term of the loan. The Fund has the right under the Lending Agreement to recover the securities from the borrower on demand. The security lending agent and the borrower retain a portion of the earnings from collateral investments. The Fund records security lending income net of such allocation. At May 31, 2004, the market value of securities on loan was $3,607,479, for which cash collateral was received and invested in accordance with the Lending Agreement. Such investments are presented on the Statement of Net Assets under the caption "Securities Lending Collateral." 9. GEOGRAPHIC DISCLOSURE As of May 31, 2004, the Fund's geographic diversification (based on the issuer of each security's domicile) of its investments portfolio before security lending collateral was as follows: COUNTRY MARKET VALUE - -------------------------------------------------------------- United States $58,968,581 59.77% - -------------------------------------------------------------- Britain 7,633,505 7.74% - -------------------------------------------------------------- Japan 6,287,197 6.37% - -------------------------------------------------------------- Australia 4,908,070 4.98% - -------------------------------------------------------------- France 4,822,070 4.89% - -------------------------------------------------------------- Germany 3,145,223 3.19% - -------------------------------------------------------------- Sweden 2,397,038 2.43% - -------------------------------------------------------------- Belgium 1,930,917 1.96% - -------------------------------------------------------------- Poland 1,779,873 1.80% - -------------------------------------------------------------- Spain 1,677,179 1.70% - -------------------------------------------------------------- COUNTRY MARKET VALUE - -------------------------------------------------------------- Netherlands $ 1,306,824 1.32% - -------------------------------------------------------------- Hong Kong 894,161 0.91% - -------------------------------------------------------------- New Zealand 660,295 0.67% - -------------------------------------------------------------- Austria 559,429 0.57% - -------------------------------------------------------------- Italy 440,511 0.45% - -------------------------------------------------------------- South Africa 412,606 0.42% - -------------------------------------------------------------- Greece 289,767 0.29% - -------------------------------------------------------------- Singapore 289,284 0.29% - -------------------------------------------------------------- Finland 249,518 0.25% - -------------------------------------------------------------- TOTAL $98,652,048 100.00% Like any investment in securities, the value of the Fund may be subject to risk or loss from market, currency, economic and political factors, which occur in the countries where the Fund is invested. 10. 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 invests in high-yield fixed income securities, which carry ratings of BB or lower by Standard & Poor's Ratings Group and/or Ba or lower by Moody's Investors Service, Inc. 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 real estate investment trusts (REITs) and is subject to some the risks associated with that industry. If the Fund holds real estate directly as a result of defaults or receives rental income directly from real estate holdings, its tax status as a regulated investment company may be jeopardized. There were no direct holdings during the six months ended May 31, 2004. The Fund's REIT holdings are also affected by interest rate changes, particularly if the REITs it holds use floating rate debt to finance their ongoing operations. 11. CONTRACTUAL OBLIGATIONS The Fund enters into contracts in the normal course of business that contain a variety of indemnifications. The Fund's maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these contracts. Management has reviewed the Fund's existing contracts and expects the risk of loss to be remote. 13 Delaware Investments(SM) [Graphic Omitted] - -------------------------------------- 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 figures in this report represent past results which are not a guarantee of future results. The return and principal value of an investment in the Fund will fluctuate so that shares, when sold, may be worth more or less than their original cost. Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940 that the Fund may, from time to time, purchase shares of its Common Stock on the open market at market prices.
BOARD OF DIRECTORS AFFILIATED OFFICERS CONTACT INFORMATION JUDE T. DRISCOLL JOSEPH H. HASTINGS INVESTMENT MANAGER Chairman Executive Vice President and Delaware Management Company Delaware Investments Family of Funds Chief Financial Officer Philadelphia, PA Philadelphia, PA Delaware Investments Family of Funds Philadelphia, PA INVESTMENT SUB-ADVISER WALTER P. BABICH Delaware International Advisers Ltd. Board Chairman RICHELLE S. MAESTRO London, England Citadel Construction Corporation Executive Vice President, King of Prussia, PA Chief Legal Officer and Secretary PRINCIPAL OFFICE OF THE FUND Delaware Investments Family of Funds 2005 Market Street JOHN H. DURHAM Philadelphia, PA Philadelphia, PA 19103 Private Investor Gwynedd Valley, PA JOHN A. FRY MICHAEL P. BISHOF INDEPENDENT AUDITORS President Franklin & Marshall College Senior Vice President and Treasurer Ernst & Young LLP Lancaster, PA Delaware Investments 2001 Market Street Family of Funds Philadelphia, PA 19103 ANTHONY D. KNERR Philadelphia, PA Managing Director REGISTRANT AND STOCK TRANSFER AGENT Anthony Knerr & Associates Mellon Investor Services, LLC New York, NY Overpeck Centre 85 Challenger Road ANN R. LEVEN+ Ridgefield, NJ 07660 Former Treasurer/Chief Fiscal Officer 800 851-9677 National Gallery of Art Washington, DC FOR SECURITIES DEALERS AND FINANCIAL INSTITUTIONS REPRESENTATIVES ONLY THOMAS F. MADISON+ 800 362-7500 President and Chief Executive Officer MLM Partners, Inc. WEB SITE Minneapolis, MN www.delawareinvestments.com JANET L. YEOMANS+ Vice President/Mergers & Acquisitions 3M Corporation St. Paul, MN
- -------------------------------------------------------------------------------- A description of the policies and procedures that the Fund uses to determine how to vote proxies (if any) relating to portfolio securities is available without charge (i) upon request, by calling 800-523-1918; (ii) on the Fund's website at http://www.delawareinvestments.com; and (iii) on the Commission's website at http://www.sec.gov.; and beginning no later than August 31, 2004, information (if any) regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge (i) through the Fund's website at http://www.delawareinvestments.com; and (ii) on the Commission's website at http://www.sec.gov. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 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. - -------------------------------------------------------------------------------- + Audit Committee Member (8783) Printed in the USA SA-DGF [5/04] IVES 7/04 J9724 Item 2. Code of Ethics Not applicable. Item 3. Audit Committee Financial Expert Not applicable. Item 4. Principal Accountant Fees and Services Not applicable. Item 5. Audit Committee of Listed Registrants Not applicable. Item 6. [Reserved] Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies Not applicable. Item 8. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers Required only for periods ending on or after June 15, 2004. Item 9. Submission of Matters to a Vote of Security Holders Not applicable. Item 10. Controls and Procedures The registrant's principal executive officer and principal financial officer have evaluated the registrant's disclosure controls and procedures within 90 days of the filing of this report and have concluded that they are effective in providing reasonable assurance that the information required to be disclosed by the registrant in its reports or statements filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. There were no significant changes in the registrant's internal control over financial reporting that occurred during the registrant's last fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 11. Exhibits (a) (1) Code of Ethics Not applicable. (2) Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rule 30a-2 under the Investment Company Act of 1940 are attached hereto as Exhibit 99.CERT. (3) Written solicitations to purchase securities pursuant to Rule 23c-1 under the Securities Exchange Act of 1934. Not applicable. (b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are furnished herewith as Exhibit 99.906CERT. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf, by the undersigned, thereunto duly authorized. NAME OF REGISTRANT: Delaware Investments Global Dividend and Income Fund, Inc. JUDE T. DRISCOLL - ------------------------- By: Jude T. Driscoll Title: Chairman Date: 8/5/04 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. JUDE T. DRISCOLL By: Jude T. Driscoll - ---------------------------- Title: Chairman Date: 8/5/04 JOSEPH H. HASTINGS - ---------------------------- By: Joseph H. Hastings Title: Chief Financial Officer Date: 8/5/04 EX-99 2 ex99-cert.txt EXHIBIT 99.CERT EXHIBIT 99.CERT CERTIFICATION I, Jude T. Driscoll, certify that: 1. I have reviewed this report on Form N-CSR of Delaware Investments Global Dividend and Income Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/5/04 JUDE T. DRISCOLL - ----------------------- By: Jude T. Driscoll Title: Chairman CERTIFICATION I, Joseph H. Hastings, certify that: 1. I have reviewed this report on Form N-CSR of Delaware Investments Global Dividend and Income Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/5/04 JOSEPH H. HASTINGS - ------------------------------ By: Joseph H. Hastings Title: Chief Financial Officer EX-99 3 ex99-906cert.txt EXHIBIT 99.906CERT EXHIBIT 99.906CERT CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the attached report of the registrant on Form N-CSR to be filed with the Securities and Exchange Commission (the "Report"), each of the undersigned officers of the registrant does hereby certify, to the best of such officer's knowledge, that: 1. The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly represents, in all material respects, the financial condition and results of operations of the registrant as of, and for, the periods presented in the Report. Date: 8/5/04 JUDE T. DRISCOLL - ------------------------------- By:Jude T. Driscoll Title: Chairman JOSEPH H. HASTINGS - ------------------------------- By: Joseph H. Hastings Title: Chief Financial Officer A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act, or other document authenticating, acknowledging, or otherwise adopting the signatures that appear in typed form within the electronic version of this written statement required by Section 906, has been provided to the registrant and will be retained by the registrant and furnished to the SEC or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----