Voyageur Mutual Funds Iii NCSRS Certified semi-annual shareholder report (management investment company)

Voyageur Mutual Funds Iii N-CSRSCertified semi-annual shareholder report (management investment company)

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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:		811-04547

Exact name of registrant as specified in charter:		Voyageur Mutual Funds III

Address of principal executive offices:		2005 Market Street
		Philadelphia, PA 19103

Name and address of agent for service:		David F. Connor, Esq.
		2005 Market Street
		Philadelphia, PA 19103

Registrant’s telephone number, including area code:		(800) 523-1918

Date of fiscal year end:		October 31

Date of reporting period:		April 30, 2018

Item 1. Reports to Stockholders

LOGO

US equity mutual fund

Delaware Select Growth Fund

April 30, 2018

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund’s prospectus and its summary prospectus, which may be obtained by visiting delawarefunds.com/literature or calling 800 523-1918. Investors should read the prospectus and the summary prospectus carefully before investing.

You can obtain shareholder reports and prospectuses online instead of in the mail.

Visit delawarefunds.com/edelivery.

LOGO

Experience Delaware Funds^® by Macquarie

Macquarie Investment Management (MIM) is a global asset manager with offices throughout the United States, Europe, Asia, and Australia. We are active managers who prioritize autonomy and accountability at the investment team level in pursuit of opportunities that matter for our clients. Delaware Funds is one of the longest-standing mutual fund families, with more than 75 years in existence.

If you are interested in learning more about creating an investment plan, contact your financial advisor.

You can learn more about Delaware Funds or obtain a prospectus for Delaware Select Growth Fund at delawarefunds.com/literature.

Manage your account online

Check your account balance and transactions

View statements and tax forms

Make purchases and redemptions

Visit delawarefunds.com/account-access.

Macquarie Asset Management (MAM) offers a diverse range of products including securities investment management, infrastructure and real asset management, and fund and equity-based structured products. Macquarie Investment Management (MIM) is the marketing name for certain companies comprising the asset management division of Macquarie Group. This includes the following registered investment advisers: Macquarie Investment Management Business Trust (MIMBT), Macquarie Funds Management Hong Kong Limited, Macquarie Investment Management Austria Kapitalanlage AG, Macquarie Investment Management Global Limited, Macquarie Investment Management Limited, Macquarie Investment Management Europe Limited, and Macquarie Capital Investment Management LLC.

The Fund is distributed by Delaware Distributors, L.P. (DDLP), an affiliate of MIMBT and Macquarie Group Limited.

Other than Macquarie Bank Limited (MBL), none of the entities noted are authorized deposit-taking institutions for the purposes of the Banking Act 1959 (Commonwealth of Australia). The obligations of these entities do not represent deposits or other liabilities of MBL. MBL does not guarantee or otherwise provide assurance in respect of the obligations of these entities, unless noted otherwise. The Fund is governed by US laws and regulations.

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Disclosure of Fund expenses			1

Security type / sector allocation and top 10 equity holdings			3

Schedule of investments			5

Statement of assets and liabilities			9

Statement of operations			11

Statements of changes in net assets			12

Financial highlights			14

Notes to financial statements			22

About the organization			35

Unless otherwise noted, views expressed herein are current as of April 30, 2018, and subject to change for events occurring after such date.

The Fund is not FDIC insured and is not guaranteed. It is possible to lose the principal amount invested.

Advisory services provided by Delaware Management Company, a series of MIMBT, a US registered investment advisor.

All third-party marks cited are the property of their respective owners.

Disclosure of Fund expenses

For the six-month period from November 1, 2017 to April 30, 2018 (Unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, reinvested dividends, or other distributions; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period from Nov. 1, 2017 to April 30, 2018.

Actual expenses

The first section of the table shown, “Actual Fund return,” provides information about actual account values and actual expenses. You may use the information in this section of the table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical example for comparison purposes

The second section of the table shown, “Hypothetical 5% return,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. The Fund’s expenses shown in the table reflect fee waivers in effect. The expenses shown in the table assume reinvestment of all dividends and distributions.

Disclosure of Fund expenses

For the six-month period from November 1, 2017 to April 30, 2018 (Unaudited)

Delaware Select Growth Fund

Expense analysis of an investment of $1,000


	Beginning Account Value 11/1/17		Ending Account Value 4/30/18		Annualized Expense Ratio		Expenses Paid During Period 11/1/17 to 4/30/18*
Actual Fund return^†
Class A		$1,000.00		$1,025.40		1.25%		$6.28
Class C		1,000.00		1,021.50		2.00%		10.02
Class R		1,000.00		1,024.10		1.50%		7.53
Institutional Class		1,000.00		1,026.50		1.00%		5.02
Hypothetical 5% return (5% return before expenses)
Class A		$1,000.00		$1,018.60		1.25%		$6.26
Class C		1,000.00		1,014.88		2.00%		9.99
Class R		1,000.00		1,017.36		1.50%		7.50
Institutional Class		1,000.00		1,019.84		1.00%		5.01

^*“Expenses Paid During Period” are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

^†Because actual returns reflect only the most recent six-month period, the returns shown may differ significantly from fiscal year returns.

Security type / sector allocation and

top 10 equity holdings


Delaware Select Growth Fund		As of April 30, 2018 (Unaudited)

Sector designations may be different than the sector designations presented in other Fund materials. The sector designations may represent the investment manager’s internal sector classifications.


Security type / sector	Percentage of net assets
Common Stocks²		98.90%
Consumer Discretionary		17.86%
Energy		1.39%
Financials		8.41%
Healthcare		13.26%
Industrials		7.02%
Real Estate		4.35%
Technology		46.61%
Short-Term Investments		1.34%
Total Value of Securities		100.24%
Liabilities Net of Receivables and Other Assets		(0.24%)
Total Net Assets		100.00%

²	Narrow industries are utilized for compliance purposes for diversification whereas broad sectors are used for financial reporting.

To monitor compliance with the Fund’s concentration guidelines as described in the Fund’s prospectus and statement of additional information, the Technology sector (as disclosed herein for financial reporting purposes) is subdivided into a variety of “industries” (in accordance with the requirements of the Investment Company Act of 1940). The Technology sector consisted of commercial services, computers, diversified financial services, Internet, diversified machinery, semiconductors, software, and telecommunications. As of April 30, 2018 such amounts, as a percentage of total net assets, were 4.73%, 0.65%, 5.38%, 14.11%, 1.00%, 4.13%, 15.43%, and 1.18%, respectively. The percentage in any such single industry will comply with the Fund’s concentration policy even if the percentage in the Technology sector for financial reporting purposes may exceed 25%.

Security type / sector allocation and

top 10 equity holdings

Delaware Select Growth Fund

Holdings are for informational purposes only and are subject to change at any time. They are not a recommendation to buy, sell, or hold any security.


Top 10 equity holdings	Percentage of net assets
Microsoft		8.57	%
Alphabet Class A and Class C		4.95	%
PayPal Holdings		4.73	%
New York Times Class A		4.39	%
Charles Schwab		3.84	%
Biogen		3.59	%
FedEx		3.37	%
Visa Class A		3.03	%
Take-Two Interactive Software		2.81	%
Liberty Global Class A and Class C		2.61	%

Schedule of investments


Delaware Select Growth Fund		April 30, 2018 (Unaudited)


	Number of shares		Value (US $)
Common Stock – 98.90%²
Consumer Discretionary – 17.86%
Dollar General		43,547	$	4,203,592
Domino’s Pizza		17,706		4,280,071
Dunkin’ Brands Group		59,114		3,603,589
Liberty Global Class A †		76,448		2,304,143
Liberty Global Class C †		243,062		7,073,104
Liberty TripAdvisor Holdings Class A †		956,908		8,803,554
Naspers		12,290		3,016,488
New York Times Class A		672,532		15,770,875
Qurate Retail Group QVC Group Class A †		183,586		4,297,748
Start Today		62,746		1,811,724
TripAdvisor †		236,084		8,834,263
Zalando 144A #†		3,476		179,448

				64,178,599

Energy – 1.39%
Centennial Resource Development Class A †		181,490		3,357,565
Kinder Morgan		103,733		1,641,056

				4,998,621

Financials – 8.41%
Affiliated Managers Group		4,361		718,954
Charles Schwab		247,887		13,802,348
CME Group		53,761		8,477,034
Intercontinental Exchange		65,855		4,771,853
LendingTree †		10,354		2,468,394

				30,238,583

Healthcare – 13.26%
ABIOMED †		5,880		1,769,586
Allergan		20,976		3,222,962
athenahealth †		20,161		2,469,118
Biogen †		47,218		12,918,845
Cambrex †		5,898		312,299
DENTSPLY SIRONA		127,131		6,399,775
Evolent Health Class A †		42,871		707,371
Haemonetics †		13,897		1,084,522
Illumina †		23,829		5,741,121
IQVIA Holdings †		81,319		7,787,107
UnitedHealth Group		22,158		5,238,151

				47,650,857

Industrials – 7.02%
Boeing		21,975		7,329,981
Expeditors International of Washington		40,010		2,555,039
Experian		32,324		741,823

Schedule of investments

Delaware Select Growth Fund


	Number of shares		Value (US $)
Common Stock² (continued)
Industrials (continued)
FedEx		49,059	$	12,127,385
IHS Markit †		50,566		2,484,308

				25,238,536

Real Estate – 4.35%
Crown Castle International		32,628		3,291,186
Equinix		1,783		750,269
Equity Commonwealth †		157,417		4,878,353
Outfront Media		50,356		944,175
Redfin †		270,197		5,782,216

				15,646,199

Technology – 46.61%
Alibaba Group Holding ADR †		6,062		1,082,309
Alphabet Class A †		10,643		10,840,747
Alphabet Class C †		6,821		6,939,208
Amadeus IT Group		4,781		350,454
Applied Materials		169,904		8,439,132
Arista Networks †		11,428		3,023,277
ASML Holding		3,380		642,866
Autodesk †		6,833		860,275
Baidu ADR †		9,157		2,297,491
Cargurus †		17,169		530,865
Cars.com †		101,292		2,884,796
Delivery Hero 144A #†		8,876		424,459
eBay †		247,257		9,366,095
Electronic Arts †		52,810		6,230,524
IPG Photonics †		11,517		2,453,467
j2 Global		69,212		5,494,049
Logitech International		51,594		1,920,067
Mastercard Class A		47,350		8,441,085
MercadoLibre		2,186		742,387
Micro Focus International		34,491		594,972
Microsoft		329,417		30,807,078
Paycom Software †		6,467		738,596
PayPal Holdings †		228,050		17,014,811
Samsung Electronics		261		650,733
Samsung Electronics GDR		2,129		2,637,831
Scout24 144A #		36,502		1,892,787
ServiceNow †		1,767		293,569
Spotify Technology †		2,644		427,455
Symantec		173,109		4,810,699
Take-Two Interactive Software †		101,150		10,085,667
Tencent Holdings		19,527		972,786


	Number of shares		Value (US $)
Common Stock² (continued)
Technology (continued)
Ubiquiti Networks †		16,901	$	1,204,365
Varonis Systems †		6,539		427,324
Visa Class A		85,955		10,905,970
Wix.com †		60,486		4,974,974
Yelp †		56,217		2,521,332
Zebra Technologies †		26,731		3,604,141

				167,528,643

Total Common Stock (cost $295,410,543)				355,480,038


	Principal amount°
Short-Term Investments – 1.34%
Discount Notes – 0.45%≠
Federal Home Loan Bank
0.00% 5/1/18		876,441		876,441
1.579% 5/4/18		404,186		404,129
1.619% 5/2/18		354,668		354,651

				1,635,221

Repurchase Agreements – 0.89%
Bank of America Merrill Lynch
1.64%, dated 4/30/18, to be repurchased on 5/1/18, repurchase price $438,237 (collateralized by US government obligations 1.143%–2.625% 4/30/19–5/15/25; market value $446,982)		438,217		438,217
Bank of Montreal
1.57%, dated 4/30/18, to be repurchased on 5/1/18, repurchase price $1,314,709 (collateralized by US government obligations 0.00%–3.625% 5/24/18–1/15/26; market value $1,340,945)		1,314,651		1,314,651
BNP Paribas
1.66%, dated 4/30/18, to be repurchased on 5/1/18, repurchase price $1,440,657 (collateralized by US government obligations 0.00%–2.875% 9/27/18–11/15/45; market value $1,469,403)		1,440,591		1,440,591

				3,193,459

Total Short-Term Investments (cost $4,828,685)				4,828,680


Total Value of Securities – 100.24% (cost $300,239,228)			$	360,308,718

#	Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. At April 30, 2018, the aggregate value of Rule 144A securities was $2,496,694, which represents 0.69% of the Fund’s net assets. See Note 9 in “Notes to financial statements.”

Schedule of investments

Delaware Select Growth Fund

²	Narrow industries are utilized for compliance purposes for diversification whereas broad sectors are used for financial reporting.

≠	The rate shown is the effective yield at the time of purchase.

°	Principal amount shown is stated in US dollars unless noted that the security is denominated in another currency.

†	Non-income producing security.

The following foreign currency exchange contracts were outstanding at April 30, 2018:¹

Foreign Currency Exchange Contracts


Counterparty	Contracts to Receive (Deliver)			In Exchange For			Settlement Date			Unrealized Appreciation		Unrealized Depreciation
BNYM	EUR	(21,761	)	USD	26,337			5/2/18	��	$	54	$	—
BNYM	EUR	(50,414	)	USD	60,915			5/3/18			22		—
BNYM	GBP	(42,134	)	USD	58,029			5/1/18			21		—
BNYM	JPY	5,588,370		USD	(51,176	)		5/2/18			—		(51)

Total Foreign Currency Exchange Contracts										$	97		$ (51)

The use of foreign currency exchange contracts involves elements of market risk and risks in excess of the amounts disclosed in the financial statements. The foreign currency exchange contracts presented above represent the Fund’s total exposure in such contracts, whereas only the net unrealized appreciation (depreciation) is reflected in the Fund’s net assets.

¹See Note 6 in “Notes to financial statements.”

Summary of abbreviations:

ADR – American Depositary Receipt

BNYM – BNY Mellon

EUR – European Monetary Unit

GBP – British Pound Sterling

GDR – Global Depositary Receipt

JPY – Japanese Yen

USD – US Dollar

See accompanying notes, which are an integral part of the financial statements.

Statement of assets and liabilities


Delaware Select Growth Fund		April 30, 2018 (Unaudited)


Assets:
Investments, at value¹	$360,308,718
Foreign currencies, at value²	511,739
Cash	57,907
Receivable for securities sold	817,063
Foreign tax reclaims receivable	203,497
Receivable for fund shares sold	52,407
Dividends and interest receivable	49,444
Unrealized appreciation on foreign currency exchange contracts	97

Total assets	362,000,872

Liabilities:
Payable for securities purchased	1,207,877
Payable for fund shares redeemed	841,857
Investment management fees payable to affiliates	219,636
Other accrued expenses	207,776
Distribution fees payable to affiliates	82,139
Dividend disbursing and transfer agent fees and expenses payable to affiliates	5,855
Accounting and administration expenses payable to affiliates	1,467
Trustees’ fees and expenses payable to affiliates	958
Legal fees payable to affiliates	944
Reports and statements to shareholders expenses payable to affiliates	243
Unrealized depreciation on foreign currency exchange contracts	51

Total liabilities	2,568,803

Total Net Assets	$359,432,069


Net Assets Consist of:
Paid-in capital	$275,975,713
Accumulated net investment loss	(890,981	)
Accumulated net realized gain on investments	24,280,194
Net unrealized appreciation of investments	60,069,490
Net unrealized depreciation of foreign currencies	(2,393	)
Net unrealized appreciation of foreign currency exchange contracts	46

Total Net Assets	$359,432,069

Statement of assets and liabilities

Delaware Select Growth Fund


Net Asset Value
Class A:
Net assets	$	221,809,443
Shares of beneficial interest outstanding, unlimited authorization, no par		5,814,875
Net asset value per share	$	38.15
Sales charge		5.75	%
Offering price per share, equal to net asset value per share / (1 – sales charge)	$	40.48

Class C:
Net assets	$	40,196,473
Shares of beneficial interest outstanding, unlimited authorization, no par		1,494,305
Net asset value per share	$	26.90

Class R:
Net assets	$	4,233,593
Shares of beneficial interest outstanding, unlimited authorization, no par		118,122
Net asset value per share	$	35.84

Institutional Class:
Net assets	$	93,192,560
Shares of beneficial interest outstanding, unlimited authorization, no par		2,243,196
Net asset value per share	$	41.54

¹Investments, at cost	$	300,239,228
²Foreign currencies, at cost		510,251

See accompanying notes, which are an integral part of the financial statements.

Statement of operations


Delaware Select Growth Fund		Six months ended April 30, 2018 (Unaudited)


Investment Income:
Dividends	$	1,531,768
Interest		20,533
Foreign tax withheld		(16,809	)

		1,535,492

Expenses:
Management fees		1,429,645
Distribution expenses – Class A		292,362
Distribution expenses – Class C		215,454
Distribution expenses – Class R		11,630
Dividend disbursing and transfer agent fees and expenses		278,801
Reports and statements to shareholders expenses		51,910
Accounting and administration expenses		48,573
Registration fees		38,015
Legal fees		23,774
Audit and tax fees		17,872
Trustees’ fees and expenses		9,191
Custodian fees		4,232
Other		13,669

		2,435,128
Less expenses waived		(7,825	)
Less expense paid indirectly		(830	)

Total operating expenses		2,426,473

Net Investment Loss		(890,981	)


Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		28,337,747
Foreign currencies		11,747
Foreign currency exchange contracts		(19,312	)

Net realized gain		28,330,182

Net change in unrealized appreciation (depreciation) of:
Investments		(17,045,397	)
Foreign currencies		2,687
Foreign currency exchange contracts		46

Net change in unrealized appreciation (depreciation)		(17,042,664	)

Net Realized and Unrealized Gain		11,287,518

Net Increase in Net Assets Resulting from Operations	$	10,396,537

See accompanying notes, which are an integral part of the financial statements.

Statements of changes in net assets

Delaware Select Growth Fund


	Six months
	ended
	4/30/18			Year ended
	(Unaudited)			10/31/17
Increase (Decrease) in Net Assets from Operations:
Net investment loss	$	(890,981	)	$	(1,729,908	)
Net realized gain		28,330,182			26,638,046
Net change in unrealized appreciation (depreciation)		(17,042,664	)		57,756,983

Net increase in net assets resulting from operations		10,396,537			82,665,121


Dividends and Distributions to Shareholders from:
Net realized gain:
Class A		(13,284,528	)		(33,563,358	)
Class C		(3,396,155	)		(10,351,305	)
Class R		(291,213	)		(1,391,001	)
Institutional Class		(5,317,098	)		(20,784,384	)

		(22,288,994	)		(66,090,048	)


Capital Share Transactions:
Proceeds from shares sold:
Class A		2,208,623			10,376,973
Class C		227,904			518,709
Class R		245,334			1,299,257
Institutional Class		6,187,424			25,672,077

Net asset value of shares based upon reinvestment of dividends and distributions:
Class A		13,034,709			32,864,589
Class C		3,354,158			10,034,042
Class R		288,244			1,390,989
Institutional Class		5,243,724			20,470,366

		30,790,120			102,627,002


	Six months ended 4/30/18 (Unaudited)			Year ended 10/31/17
Capital Share Transactions (continued):
Cost of shares redeemed:
Class A	$	(23,759,581	)	$	(70,786,700	)
Class C		(5,786,951	)		(25,425,897	)
Class R		(1,050,884	)		(9,284,945	)
Institutional Class		(19,489,323	)		(118,440,922	)

		(50,086,739	)		(223,938,464	)


Decrease in net assets derived from capital share transactions		(19,296,619	)		(121,311,462	)

Net Decrease in Net Assets		(31,189,076	)		(104,736,389	)

Net Assets:
Beginning of period		390,621,145			495,357,534

End of period	$	359,432,069		$	390,621,145

Accumulated net investment loss	$	(890,981	)	$	—

See accompanying notes, which are an integral part of the financial statements.

Financial highlights

Delaware Select Growth Fund Class A

Selected data for each share of the Fund outstanding throughout each period were as follows:

Net asset value, beginning of period

Income (loss) from investment operations:

Net investment income (loss)³

Net realized and unrealized gain (loss)

Total from investment operations

Less dividends and distributions from:

Net investment income

Net realized gain

Total dividends and distributions

Net asset value, end of period.

Total return⁴

Ratios and supplemental data:

Net assets, end of period (000 omitted)

Ratio of expenses to average net assets

Ratio of expenses to average net assets prior to fees waived⁵

Ratio of net investment income (loss) to average net assets

Ratio of net investment income (loss) to average net assets prior to fees waived⁵

Portfolio turnover

¹	Ratios have been annualized and total return and portfolio turnover have not been annualized.

²	During the period ended Oct. 31, 2013, the Fund changed its fiscal year end from April to October. Ratios have been annualized and portfolio turnover and total return have not been annualized.

³	The average shares outstanding method has been applied for per share information.

⁴

Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect.

⁵	Expenses paid indirectly were not material and had no impact on the ratios disclosed. Expenses paid indirectly for the six months ended April 30, 2018 are reflected on the “Statement of operations.”

See accompanying notes, which are an integral part of the financial statements.


Six months ended 4/30/18¹								Year ended												5/1/13 to				Year ended
(Unaudited)				10/31/17				10/31/16				10/31/15				10/31/14				10/31/13²				4/30/13
	$	39.46			$	37.68			$	47.82			$	52.44			$	49.60			$	44.01			$	40.73

		(0.09	)			(0.14	)			(0.11	)			0.05				(0.06	)			(0.05	)			(0.03	)
		1.02				7.13				(0.31	)			1.20				4.68				5.64				3.31

		0.93				6.99				(0.42	)			1.25				4.62				5.59				3.28


		—				—				—				(0.09	)			—				—				—
		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—				—

		(2.24	)			(5.21	)			(9.72	)			(5.87	)			(1.78	)			—				—


	$	38.15			$	39.46			$	37.68			$	47.82			$	52.44			$	49.60			$	44.01


		2.54%				21.43%				(1.63%	)			2.31%				9.53%				12.70%				8.05%

	$	221,809			$	237,363			$	253,027			$	348,846			$	402,000			$	489,286			$	463,627
		1.25%				1.25%				1.26%				1.25%				1.25%				1.25%				1.27%

		1.25%				1.28%				1.28%				1.25%				1.25%				1.25%				1.27%
		(0.45%	)			(0.39%	)			(0.30%	)			0.09%				(0.12%	)			(0.19%	)			(0.06%	)

		(0.45%	)			(0.42%	)			(0.32%	)			0.09%				(0.12%	)			(0.19%	)			(0.06%	)
		25%				35%				33%				46%				41%				20%				38%

Financial highlights

Delaware Select Growth Fund Class C

Selected data for each share of the Fund outstanding throughout each period were as follows:

Net asset value, beginning of period

Income (loss) from investment operations:

Net investment loss³

Net realized and unrealized gain (loss)

Total from investment operations

Less dividends and distributions from:

Net realized gain

Total dividends and distributions

Net asset value, end of period.

Total return⁴

Ratios and supplemental data:

Net assets, end of period (000 omitted)

Ratio of expenses to average net assets

Ratio of expenses to average net assets prior to fees waived⁵

Ratio of net investment loss to average net assets.

Ratio of net investment loss to average net assets prior to fees waived⁵

Portfolio turnover

¹	Ratios have been annualized and total return and portfolio turnover have not been annualized.

²	During the period ended Oct. 31, 2013, the Fund changed its fiscal year end from April to October. Ratios have been annualized and portfolio turnover and total return have not been annualized.

³	The average shares outstanding method has been applied for per share information.

⁴

⁵	Expenses paid indirectly were not material and had no impact on the ratios disclosed. Expenses paid indirectly for the six months ended April 30, 2018 are reflected on the “Statement of operations.”

See accompanying notes, which are an integral part of the financial statements.


Six months ended 4/30/17								Year ended												5/1/13 to				Year ended
(Unaudited)¹				10/31/17				10/31/16				10/31/15				10/31/14				10/31/13²				4/30/13
	$	28.60			$	28.91			$	39.13			$	44.16			$	42.34			$	37.71			$	35.17

		(0.16	)			(0.30	)			(0.31	)			(0.27	)			(0.37	)			(0.19	)			(0.28	)
		0.70				5.20				(0.19	)			1.02				3.97				4.82				2.82

		0.54				4.90				(0.50	)			0.75				3.60				4.63				2.54


		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—				—

		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—				—


	$	26.90			$	28.60			$	28.91			$	39.13			$	44.16			$	42.34			$	37.71


		2.15%				20.57%				(2.36%	)			1.52%				8.71%				12.28%				7.22%

	$	40,196			$	44,775			$	60,815			$	87,833			$	101,991			$	115,635			$	109,164
		2.00%				2.00%				2.01%				2.00%				2.00%				2.00%				2.02%

		2.00%				2.03%				2.03%				2.00%				2.00%				2.00%				2.02%
		(1.20%	)			(1.14%	)			(1.05%	)			(0.66%	)			(0.87%	)			(0.94%	)			(0.81%	)

		(1.20%	)			(1.17%	)			(1.07%	)			(0.66%	)			(0.87%	)			(0.94%	)			(0.81%	)
		25%				35%				33%				46%				41%				20%				38%

Financial highlights

Delaware Select Growth Fund Class R

Selected data for each share of the Fund outstanding throughout each period were as follows:

Net asset value, beginning of period

Income (loss) from investment operations:

Net investment loss³

Net realized and unrealized gain (loss)

Total from investment operations

Less dividends and distributions from:

Net realized gain

Total dividends and distributions

Net asset value, end of period

Total return⁴

Ratios and supplemental data:

Net assets, end of period (000 omitted)

Ratio of expenses to average net assets

Ratio of expenses to average net assets prior to fees waived⁵

Ratio of net investment loss to average net assets

Ratio of net investment loss to average net assets prior to fees waived⁵

Portfolio turnover

¹	Ratios have been annualized and total return and portfolio turnover have not been annualized.

²	During the period ended Oct. 31, 2013, the Fund changed its fiscal year end from April to October. Ratios have been annualized and portfolio turnover and total return have not been annualized.

³	The average shares outstanding method has been applied for per share information.

⁴

Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects waivers by the manager and/or distributor. Performance would have been lower had the waivers not been in effect.

⁵	Expenses paid indirectly were not material and had no impact on the ratios disclosed. Expenses paid indirectly for the six months ended April 30, 2018 are reflected on the “Statement of operations.”

See accompanying notes, which are an integral part of the financial statements.


Six months ended 4/30/18								Year ended												5/1/13 to				Year ended
(Unaudited)¹				10/31/17				10/31/16				10/31/15				10/31/14				10/31/13²				4/30/13
	$	37.26			$	35.94			$	46.15			$	50.83			$	48.25			$	42.87			$	39.77

		(0.13	)			(0.22	)			(0.20	)			(0.08	)			(0.18	)			(0.10	)			(0.12	)
		0.95				6.75				(0.29	)			1.18				4.54				5.48				3.22

		0.82				6.53				(0.49	)			1.10				4.36				5.38				3.10


		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—				—

		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—				—


	$	35.84			$	37.26			$	35.94			$	46.15			$	50.83			$	48.25			$	42.87


		2.41%				21.16%				(1.87%	)			2.02%				9.26%				12.55%				7.79%

	$	4,234			$	4,913			$	11,487			$	18,766			$	20,022			$	18,681			$	13,428
		1.50%				1.50%				1.51%				1.50%				1.50%				1.50%				1.52%

		1.50%				1.53%				1.53%				1.50%				1.50%				1.58%				1.62%
		(0.70%	)			(0.64%	)			(0.55%	)			(0.16%	)			(0.37%	)			(0.44%	)			(0.31%	)

		(0.70%	)			(0.67%	)			(0.57%	)			(0.16%	)			(0.37%	)			(0.56%	)			(0.41%	)
		25%				35%				33%				46%				41%				20%				38%

Financial highlights

Delaware Select Growth Fund Institutional Class

Selected data for each share of the Fund outstanding throughout each period were as follows:

Net asset value, beginning of period

Income (loss) from investment operations:

Net investment income (loss)³

Net realized and unrealized gain (loss)

Total from investment operations

Less dividends and distributions from:

Net investment income

Net realized gain

Total dividends and distributions

Net asset value, end of period

Total return⁴

Ratios and supplemental data:

Net assets, end of period (000 omitted)

Ratio of expenses to average net assets

Ratio of expenses to average net assets prior to fees waived⁵

Ratio of net investment income (loss) to average net assets

Ratio of net investment income (loss) to average net assets prior to fees waived⁵

Portfolio turnover

¹	Ratios have been annualized and total return and portfolio turnover have not been annualized.

²	During the period ended Oct. 31, 2013, the Fund changed its fiscal year end from April to October. Ratios have been annualized and portfolio turnover and total return have not been annualized.

³	The average shares outstanding method has been applied for per share information.

⁴

Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of dividends and distributions at net asset value. Total investment return during some of the periods shown reflects a waiver by the manager. Performance would have been lower had the waiver not been in effect.

⁵	Expenses paid indirectly were not material and had no impact on the ratios disclosed. Expenses paid indirectly for the six months ended April 30, 2018 are reflected on the “Statement of operations.”

See accompanying notes, which are an integral part of the financial statements.


Six months ended 4/30/18								Year ended												5/1/13 to			Year ended
(Unaudited)¹				10/31/17				10/31/16				10/31/15				10/31/14				10/31/13²			4/30/13
	$	42.73			$	40.27			$	50.35			$	54.92			$	51.73			$	45.85		$	42.32

		(0.04	)			(0.05	)			(0.02	)			0.18				0.07				0.02			0.08
		1.09				7.72				(0.34	)			1.25				4.90				5.86			3.45

		1.05				7.67				(0.36	)			1.43				4.97				5.88			3.53


		—				—				—				(0.22	)			—				—			—
		(2.24	)			(5.21	)			(9.72	)			(5.78	)			(1.78	)			—			—

		(2.24	)			(5.21	)			(9.72	)			(6.00	)			(1.78	)			—			—


	$	41.54			$	42.73			$	40.27			$	50.35			$	54.92			$	51.73		$	45.85


		2.65%				21.76%				(1.37%	)			2.54%				9.80%				12.82%			8.34%

	$	93,193			$	103,570			$	170,029			$	422,581			$	496,967			$	446,146		$	369,526
		1.00%				1.00%				1.01%				1.00%				1.00%				1.00%			1.02%

		1.00%				1.03%				1.03%				1.00%				1.00%				1.00%			1.02%
		(0.20%	)			(0.14%	)			(0.05%	)			0.34%				0.13%				0.06%			0.19%

		(0.20%	)			(0.17%	)			(0.07%	)			0.34%				0.13%				0.06%			0.19%
		25%				35%				33%				46%				41%				20%			38%

Notes to financial statements


Delaware Select Growth Fund		April 30, 2018

Voyageur Mutual Funds III (Trust) is organized as a Delaware statutory trust and offers one series: Delaware Select Growth Fund. The Trust is an open-end investment company. The Fund is considered diversified under the Investment Company Act of 1940, as amended , and offers Class A, Class C, Class R, and Institutional Class shares. Class A shares are sold with a maximum front-end sales charge of 5.75%. Class A share purchases of $1,000,000 or more will incur a contingent deferred sales charge (CDSC) instead of a front-end sales charge of 1.00% if redeemed during the first year, and 0.50% during the second year, provided that Delaware Distributors, L.P. (DDLP) paid a financial advisor a commission on the purchase of those shares. Class C shares are sold with a CDSC of 1.00%, if redeemed during the first 12 months. Class R and Institutional Class shares are not subject to a sales charge and are offered for sale exclusively to certain eligible investors.

The investment objective of the Fund is to seek long-term capital appreciation.

1. Significant Accounting Policies

The following accounting policies are in accordance with US generally accepted accounting principles (US GAAP) and are consistently followed by the Fund.

Security Valuation – Equity securities, except those traded on the Nasdaq Stock Market LLC (Nasdaq), are valued at the last quoted sales price as of the time of the regular close of the New York Stock Exchange on the valuation date. Equity 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, the mean between the bid and ask prices will be used, which approximates fair value. Equity securities listed on a foreign exchange are normally valued at the last quoted sales price on the valuation date. US government and agency securities are valued at the mean between the bid and ask prices, which approximates fair value. Foreign currency exchange contracts and foreign cross currency exchange contracts are valued at the mean between the bid and ask prices, which approximates fair value. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available. Generally, 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 Trust’s Board of Trustees (Board). 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 suspension of trading in a security. The Fund may use fair value pricing more frequently for securities traded primarily in non-US markets because, among other things, most foreign markets close well before the Fund values its securities, generally as of 4:00pm Eastern time. The earlier close of these foreign markets gives rise to the possibility that significant events, including broad market moves, government actions or pronouncements, aftermarket trading, or news events may have occurred in the interim. Whenever such a significant event occurs, the Fund may value foreign securities using fair value prices based on third-party vendor modeling tools (international fair value pricing). Restricted securities are valued at fair value using methods approved by the Board.

Federal and Foreign Income Taxes – No provision for federal income taxes has been made as the Fund intends to continue to qualify for federal income tax purposes as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, and make the requisite distributions to shareholders. The Fund evaluates tax positions taken or expected to be taken in the

course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are recorded as a tax benefit or expense in the current year. Management has analyzed the Fund’s tax positions taken or to be taken on the Fund’s federal income tax returns through the six months ended April 30, 2018 and for all open tax years (years ended Oct. 31, 2015–Oct. 31, 2017), and has concluded that no provision for federal income tax is required in the Fund’s financial statements. If applicable, the Fund recognizes interest accrued on unrecognized tax benefits in interest expense and penalties in other expenses on “Statement of operations.” During the six months ended April 30, 2018, the Fund did not incur any interest or tax penalties. In regard to foreign taxes only, the Fund has open tax years in certain foreign countries in which it invests in that may date back to the inception of the Fund.

Class Accounting – Investment income, common expenses, and realized and unrealized gain (loss) on investments are allocated to the various classes of the Fund on the basis of daily net assets of each class. Distribution expenses relating to a specific class are charged directly to that class.

Repurchase Agreements – The Fund may purchase certain US government securities subject to the counterparty’s agreement to repurchase them at an agreed upon date and price. The counterparty will be required on a daily basis to maintain the value of the collateral subject to the agreement at not less than the repurchase price (including accrued interest). The agreements are conditioned upon the collateral being deposited under the Federal Reserve book-entry system with the Fund’s custodian or a third-party sub-custodian. In the event of default or bankruptcy by the other party to the agreement, retention of the collateral may be subject to legal proceedings. All open repurchase agreements as of the date of this report were entered into on April 30, 2018, and matured on the next business day.

Foreign Currency Transactions – Transactions denominated in foreign currencies are recorded at the prevailing exchange rates on the valuation date in accordance with the Fund’s prospectus. The value of all assets and liabilities denominated in foreign currencies is translated daily into US dollars at the exchange rate of such currencies against the US dollar. 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 generally does not bifurcate that portion of realized gains and losses on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices. These gains and losses are included on the “Statement of operations” under “Net realized and unrealized gain (loss) on investments.” The Fund reports certain foreign currency related transactions as components of realized gains (losses) for financial reporting purposes, whereas such components are treated as ordinary income (loss) for federal income tax purposes.

Use of Estimates – The Fund is an investment company whose financial statements are prepared in conformity with US GAAP. Therefore, the Fund follows the accounting and reporting guidelines for investment companies. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the fair value of investments, the reported amounts of assets and liabilities and disclosure of contingent 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 and the differences could be material.

Notes to financial statements

Delaware Select Growth Fund

1. Significant Accounting Policies (continued)

Other – Expenses directly attributable to the Fund are charged directly to the Fund. Other expenses common to various funds within the Delaware Funds^® by Macquarie (Delaware Funds) are generally allocated among such funds on the basis of average net assets. Management fees and certain other expenses are paid monthly. Security transactions are recorded on the date the securities are purchased or sold (trade date) for financial reporting purposes. 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 on debt securities are accreted or amortized to interest income, respectively, over the lives of the respective securities using the effective interest method. Taxable non-cash dividends are recorded as dividend income. Distributions received from investments in real estate investment trusts (REITs) are recorded as dividend income on the ex-dividend date, subject to reclassification upon notice of the character of such distributions by the issuer. 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 tax withholdings, a portion of which may be reclaimable. Withholding taxes and reclaims on foreign dividends have been recorded in accordance with the Fund’s understanding of the applicable country’s tax rules and rates. The Fund declares and pays dividends from net investment income and distributions from net realized gain on investments, if any, annually. The Fund may distribute more frequently, if necessary for tax purposes. Dividends and distributions, if any, are recorded on the ex-dividend date.

The Fund receives earnings credits from its custodian when positive cash balances are maintained, which may be used to offset custody fees. The expense paid under this arrangement is on the “Statement of operations” under “Custodian fees” with the corresponding expense offset included under “Less expenses paid indirectly.” For the six months ended April 30, 2018, the Fund earned $240 under this agreement.

The Fund receives earnings credits from its transfer agent when positive cash balances are maintained, which may be used to offset transfer agent fees. If the amount earned is greater than $1, the expense paid under this arrangement is included on the “Statement of operations” under “Dividend disbursing and transfer agent fees and expenses” with the corresponding expense offset included under “Less expenses paid indirectly.” For the six months ended April 30, 2018, the Fund earned $590 under this agreement.

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 Macquarie Investment Management Business Trust and the investment manager, an annual fee which is calculated daily and paid monthly at the rate of 0.75% on the first $500 million of average daily net assets of the Fund, 0.70% on the next $500 million, 0.65% on the next $1.5 billion, and 0.60% on average daily net assets in excess of $2.5 billion.

DMC has contractually agreed to waive that portion if any, of its management fee and/or pay/reimburse the Fund to the extent necessary to ensure that total annual fund operating expenses (excluding any distribution and service (12b-1) fees, acquired funds fees and expenses, taxes, interest, short sale dividend and interest expenses, brokerage fees, certain insurance costs, and nonroutine expenses or

costs, including, but not limited to those relating to reorganizations, litigation, conducting shareholder meetings, and liquidations) do not exceed 1.00% of the Fund’s average daily net assets from Nov. 1, 2017 through April 30, 2018.* For purposes of this waiver and reimbursement, nonroutine expenses may also include such additional costs and expenses as may be agreed upon from time to time by the Fund’s Board and DMC. This expense waiver and reimbursement may only be terminated by agreement of DMC and the Fund.

Jackson Square Partners, LLC (JSP), a related party of DMC, furnishes investment sub-advisory services to the Fund. For these services, DMC, not the Fund, pays JSP fees based on the aggregate average daily net assets of the Fund at the following annual rate: 0.450% of the first $500 million; 0.420% of the next $500 million; 0.390% of the next $1.5 billion; and 0.360% of aggregate average daily net assets in excess of $2.5 billion.

Delaware Investments Fund Services Company (DIFSC), an affiliate of DMC, provides fund accounting and financial administration oversight services to the Fund. For these services, DIFSC’s fees are calculated daily and paid monthly based on the aggregate daily net assets of the Delaware Funds at the following annual rate: 0.00475% of the first $35 billion; 0.0040% of the next $10 billion; and 0.0025% of aggregate average daily net assets in excess of $45 billion (Total Fee). Each fund in the Delaware Funds pays a minimum of $4,000, which, in aggregate, is subtracted from the Total Fee. Each fund in the Delaware Funds then pays its relative portion of the remainder of the Total Fee on a relative net asset value (NAV) basis. For the six months ended April 30, 2018, the Fund was charged $9,204 for these services. This amount is included on the “Statement of operations” under “Accounting and administration expenses.”

DIFSC is also the transfer agent and dividend disbursing agent of the Fund. For these services, DIFSC’s fees are calculated daily and paid monthly based on the aggregate daily net assets of the retail funds within the Delaware Funds at the following annual rate: 0.025% of the first $20 billion; 0.020% of the next $5 billion; 0.015% of the next $5 billion; and 0.013% of average daily net assets in excess of $30 billion. The fees payable to DIFSC under the service agreement described above are allocated among all retail funds in the Delaware Funds on a relative NAV basis. This amount is included on the “Statement of operations” under “Dividend disbursing and transfer agent fees and expenses.” For the six months ended April 30, 2018, the Fund was charged $37,213 for these services. Pursuant to a sub-transfer agency agreement between DIFSC and BNY Mellon Investment Servicing (US) Inc. (BNYMIS), BNYMIS provides certain sub-transfer agency services to the Fund. Sub-transfer agency fees are paid by the Fund and are also included on the “Statement of operations” under “Dividend disbursing and transfer agent fees and expenses.”

Pursuant to a distribution agreement and distribution plan, the Fund pays DDLP, the distributor and an affiliate of DMC, an annual 12b-1 fee of 0.25% of the average daily net assets of the Class A shares, 1.00% of the average daily net assets of the Class C shares, and 0.50% of the average daily net assets of the Class R shares. These fees are calculated daily and paid monthly. Institutional Class shares pay no 12b-1 fees.

As provided in the investment management agreement, the Fund bears a portion of the cost of certain resources shared with DMC, including the cost of internal personnel of DMC and/or its affiliates that provide legal, tax, and regulatory reporting services to the Fund. For the six months ended

Notes to financial statements

Delaware Select Growth Fund

2. Investment Management, Administration Agreements, and Other Transactions with Affiliates (continued)

April 30, 2018, the Fund was charged $3,862 for internal legal, tax, and regulatory reporting services provided by DMC and/or its affiliates’ employees. This amount is included on the “Statement of operations” under “Legal fees.”

For the six months ended April 30, 2018, DDLP earned $3,664 for commissions on sales of the Fund’s Class A shares. For the six months ended April 30, 2018, DDLP received gross CDSC commissions of $16 and $396 on redemptions of the Fund’s Class A and Class C shares, respectively, and these commissions were entirely used to offset upfront commissions previously paid by DDLP to broker/dealers on sales of those shares.

Trustees’ fees include expenses accrued by the Fund for each Trustee’s retainer and meeting fees. Certain officers of DMC, DIFSC, and DDLP are officers and/or Trustees of the Trust. These officers and Trustees are paid no compensation by the Fund.

*The aggregate contractual waiver period covering this report is from Feb. 28, 2017 through Feb. 28, 2019.

3. Investments

For the six months ended April 30, 2018, the Fund made purchases and sales of investment securities other than short-term investments as follows:


Purchases	$	95,731,404
Sales		137,663,681

At April 30, 2018, the cost and unrealized appreciation (depreciation) of investments and derivatives for federal income tax purposes has been estimated since final tax characteristics cannot be determined until fiscal year end. At April 30, 2018, the cost and unrealized appreciation (depreciation) of investments and derivatives for the Fund were as follows:


Cost of investments and derivatives	$	300,239,228

Aggregate unrealized appreciation of investments and derivatives	$	90,337,185
Aggregate unrealized depreciation of investments and derivatives		(30,267,649	)

Net unrealized appreciation of investments and derivatives	$	60,069,536

US GAAP defines fair value as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. A three-level hierarchy for fair value measurements has been established based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available under the circumstances. The Fund’s investment in its entirety is assigned a level based upon the observability

of the inputs which are significant to the overall valuation. The three-level hierarchy of inputs is summarized below.

Level 1 –

Inputs are quoted prices in active markets for identical investments. (Examples: equity securities, open-end investment companies, futures contracts, exchange-traded options contracts)

Level 2 –

Other observable inputs, including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or other market-corroborated inputs. (Examples: debt securities, government securities, swap contracts, foreign currency exchange contracts, foreign securities utilizing international fair value pricing, broker-quoted securities, fair valued securities)

Level 3 –

Significant unobservable inputs, including the Fund’s own assumptions used to determine the fair value of investments. (Examples: broker-quoted securities, fair valued securities)

Level 3 investments are valued using significant unobservable inputs. The Fund may also use an income-based valuation approach in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Valuations may also be based upon current market prices of securities that are comparable in coupon, rating, maturity, and industry. The derived value of a Level 3 investment may not represent the value which is received upon disposition and this could impact the results of operations.

The following table summarizes the valuation of the Fund’s investments by fair value hierarchy levels as of April 30, 2018:


	Level 1		Level 2		Total
Securities
Assets:
Common Stock
Consumer Discretionary	$	60,982,663	$	3,195,936	$	64,178,599
Energy		4,998,621		—		4,998,621
Financials		30,238,583		—		30,238,583
Healthcare		47,650,857		—		47,650,857
Industrials		24,496,713		741,823		25,238,536
Real Estate		15,646,199		—		15,646,199
Technology		160,503,978		7,024,665		167,528,643
Short-Term Investments		—		4,828,680		4,828,680

Total Value of Securities	$	344,517,614	$	15,791,104	$	360,308,718

Notes to financial statements

Delaware Select Growth Fund

3. Investments (continued)


	Level 1		Level 2		Total
Derivatives:*
Assets:
Foreign Currency Exchange Contracts		$ —		$ 97		$ 97
Liabilities:
Foreign Currency Exchange Contracts		$ —		$(51)		$(51)

*Foreign currency exchange contracts are valued at the unrealized appreciation (depreciation) of the instrument at the period end.

During the six months ended April 30, 2018, there were no transfers between Level 1 investments, Level 2 investments, or Level 3 investments that had a significant impact to the Fund. This does not include transfers between Level 1 investments and Level 2 investments due to the Fund utilizing international fair value pricing during the period. In accordance with the fair valuation procedures described in Note 1, international fair value pricing of securities in the Fund occurs when market volatility exceeds an established rolling threshold. If the threshold is exceeded on a given date, then prices of international securities (those that traded on exchanges that close at a different time than the time that the Fund’s NAV is determined) are established using a separate pricing feed from a third party vendor designed to establish a price for each such security as of the time that the Fund’s NAV is determined. Further, international fair value pricing uses other observable market-based inputs in place of the closing exchange price due to the events occurring after the close of the exchange or market on which the investment is principally traded, causing a change in classification between levels. The Fund’s policy is to recognize transfers between levels based on fair value at the beginning of the reporting period.

A reconciliation of Level 3 investments is presented when the Fund has a significant amount of Level 3 investments at the beginning, interim, or end of the period in relation to net assets. Management has determined not to provide a reconciliation of Level 3 investments as the Level 3 investments were not considered significant to the Fund’s net assets at the beginning, interim, or end of the period. At April 30, 2018 , there were no Level 3 investments.

4. Capital Shares

Transactions in capital shares were as follows:


	Six months ended 4/30/18			Year ended 10/31/17
Shares sold:
Class A		56,696			291,445
Class C		8,309			19,923
Class R		6,650			39,179
Institutional Class		146,005			674,077
Shares issued upon reinvestment of dividends and distributions:
Class A		354,398			1,006,311
Class C		128,956			421,244
Class R		8,333			45,016
Institutional Class		131,060			580,226

		840,407			3,077,421

Shares redeemed:
Class A		(611,237	)		(1,998,457	)
Class C		(208,763	)		(978,840	)
Class R		(28,731	)		(271,932	)
Institutional Class		(457,908	)		(3,051,974	)

		(1,306,639	)		(6,301,203	)

Net decrease		(466,232	)		(3,223,782	)

Certain shareholders may exchange shares of one class for shares of another class in the same Fund. These exchange transactions are included as subscriptions and redemptions in the table above and on the “Statements of changes in net assets.” For the six months ended April 30, 2018 and the year ended Oct. 31, 2017, the Fund had the following exchange transactions.


	Exchange Redemptions				Exchange Subscriptions
	Class A Shares		Class C Shares		Class A Shares			Institutional Class Shares		Value
Six months ended 4/30/18		3,116		—		—			2,863	$	122,280
Year ended 10/31/17		104,977		5,012		1,904	��		98,748		3,753,347

5. Line of Credit

The Fund, along with certain other funds in the Delaware Funds (Participants), was a participant in a $155,000,000 revolving line of credit to be used for temporary or emergency purposes as an additional source of liquidity to fund redemptions of investor shares. Under the agreement, the Participants were charged an annual commitment fee of 0.15%, which was generally allocated across the Participants

Notes to financial statements

Delaware Select Growth Fund

5. Line of Credit (continued)

based on a weighted average of the respective net assets of each Participant. The Participants were permitted to borrow up to a maximum of one-third of their net assets under the agreement. Each Participant was individually, and not jointly, liable for its particular advances, if any, under the line of credit. The line of credit available under the agreement expired on Nov. 6, 2017.

On Nov. 6, 2017, the Fund, along with the other Participants, entered into an amendment to the agreement for a $155,000,000 revolving line of credit. The line of credit is to be used as described above and operates in substantially the same manner as the original agreement. The line of credit available under the agreement expires on Nov. 5, 2018.

The Fund had no amounts outstanding as of April 30, 2018 or at any time during the period then ended.

6. Derivatives

US GAAP requires disclosures that enable investors to understand: (1) how and why an entity uses derivatives; (2) how they are accounted for; and (3) how they affect an entity’s results of operations and financial position.

Foreign Currency Exchange Contracts – The Fund may enter into foreign currency exchange contracts and foreign cross currency exchange contracts as a way of managing foreign exchange rate risk. The Fund may enter into these contracts to fix the US 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 US dollar value of securities it already owns that are denominated in foreign currencies. In addition, the Fund may enter into these contracts to facilitate or expedite the settlement of portfolio transactions. The change in 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 foreign currency exchange contracts and foreign cross 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 foreign currency exchange contracts and foreign cross currency exchange contracts limit the risk of loss due to an unfavorable change in the value of the hedged currency, they also limit any potential gain that might result should the value of the currency change favorably. In addition, the Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts. The Fund’s maximum risk of loss from counterparty credit risk is the value of its currency exchanged with the counterparty. The risk is generally mitigated by having a netting arrangement between the Fund and the counterparty and by the posting of collateral by the counterparty to the Fund to cover the Fund’s exposure to the counterparty.

During the six months ended April 30, 2018, the Fund entered into foreign currency exchange contracts to fix the US dollar value of a security between trade date and settle date.

Derivatives Generally. The table below summarizes the average balance of derivative holdings by the Fund during the six months ended April 30, 2018.


	Long Derivative Volume	Short Derivative Volume
Foreign currency exchange contracts (average cost)	$26,770	$86,200

7. Offsetting

The Fund entered into an International Swaps and Derivatives Association, Inc. Master Agreement (ISDA Master Agreement) or similar agreement with certain of its derivative contract counterparties in order to better define its contractual rights and to secure rights that will help the Fund mitigate its counterparty risk. An ISDA Master Agreement is a bilateral agreement between the Fund and a counterparty that governs certain over-the-counter (OTC) derivatives and foreign exchange contracts and typically contains, among other things, collateral posting items and netting provisions in the event of a default and/or termination event. Under an ISDA Master Agreement, the Fund may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default (close-out), including the bankruptcy or insolvency of the counterparty. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against the right of offset in bankruptcy, insolvency or other events.

For financial reporting purposes, the Fund does not offset derivative assets and derivative liabilities that are subject to netting arrangements on the “Statement of assets and liabilities.”

At April 30, 2018, the Fund had the following assets and liabilities subject to offsetting provisions:

Offsetting of Financial Assets and Liabilities and Derivative Assets and Liabilities


Counterparty			Gross Value of Derivative Asset		Gross Value of Derivative Liability			Net Position
BNY Mellon			$97		$(51)			$46

Counterparty	Net Position		Fair Value of Non-Cash Collateral Received^(a)	Cash Collateral Received	Fair Value of Non-Cash Collateral Pledged	Cash Collateral Pledged		Net Exposure^(b)
BNY Mellon		$46	$ —	$ —	$ —		$ —	$46

Master Repurchase Agreements

Repurchase agreements are entered into by the Fund under Master Repurchase Agreements (each, an MRA). The MRA permits the Fund, under certain circumstances including an event of default (such as bankruptcy or insolvency), to offset payables and/or receivables with collateral held by and/or posted to the counterparty. As a result, one single net payment is created. Bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of the MRA counterparty’s bankruptcy or insolvency. Based on the terms of the MRA, the Fund receives securities as collateral with a market value in excess of the repurchase price at maturity. Upon a bankruptcy or insolvency of the MRA counterparty, the Fund would recognize a liability with respect to such excess collateral. The liability reflects the Fund’s obligation under bankruptcy law to return the

Notes to financial statements

Delaware Select Growth Fund

7. Offsetting (continued)

excess to the counterparty. As of April 30, 2018, the following table is a summary of the Fund’s repurchase agreements by counterparty which are subject to offset under an MRA:


Counterparty	Repurchase Agreements			Fair Value of Non-Cash Collateral Received^(a)				Cash Collateral Received			Net Collateral Received				Net Exposure^(b)
Bank of America Merrill Lynch		$	438,217		$	(438,217	)		$	—		$	(438,217	)		$	—
Bank of Montreal			1,314,651			(1,314,651	)			—			(1,314,651	)			—
BNP Paribas			1,440,591			(1,440,591	)			—			(1,440,591	)			—

Total		$	3,193,459		$	(3,193,459	)		$	—		$	(3,193,459	)		$	—

^(a)The value of the related collateral received exceeded the value of the repurchase agreements as of April 30, 2018.

^(b)Net exposure represents the net receivable (payable) that would be due from (to) the counterparty in the event of default.

8. Securities Lending

The Fund, along with other funds in the Delaware Funds, may lend its securities pursuant to a security lending agreement (Lending Agreement) with The Bank of New York Mellon (BNY Mellon). At the time a security is loaned, the borrower must post collateral equal to the required percentage of the market value of the loaned security, including any accrued interest. The required percentage is: (1) 102% with respect to US securities and foreign securities that are denominated and payable in US dollars; and (2) 105% with respect to foreign securities. With respect to each loan, if on any business day the aggregate market value of securities collateral plus cash collateral held 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 by the end of the following business day which, together with the collateral already held, will be not less than the applicable initial collateral requirements for such security loan. If the aggregate market value of securities collateral and cash collateral held with respect to a security loan exceeds the applicable initial collateral requirement, upon the request of the borrower, BNY Mellon must return enough collateral to the borrower by the end of the following business day to reduce the value of the remaining collateral to the applicable initial collateral requirement for such security loan. As a result of the foregoing, the value of the collateral held with respect to a loaned security on any particular day may be more or less than the value of the security on loan. The collateral percentage with respect to the market value of the loaned security is determined by the security lending agent.

Cash collateral received by each fund is generally invested in a series of individual separate accounts, each corresponding to a fund. The investment guidelines permit each separate account to hold certain securities that would be considered eligible securities for a money market fund. Cash collateral received is generally invested in government securities; certain obligations issued by government sponsored enterprises; repurchase agreements collateralized by US Treasury securities; obligations issued by the central government of any Organization for Economic Cooperation and Development (OECD) country or its agencies, instrumentalities or establishments; obligations of supranational organizations, commercial paper, notes, bonds and other debt obligations; certificates of deposit, time deposits, and other bank

obligations; and asset-backed securities. A fund can also accept US government securities and letters of credit (non-cash collateral) in connection with securities loans.

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 or interest, as applicable, on the securities loaned and is subject to changes in 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. With respect to security loans collateralized by non-cash collateral, the Fund receives loan premiums paid by the borrower. With respect to security loans collateralized by cash collateral, the earnings from the collateral investments are shared among the Fund, the security lending agent, and the borrower. The Fund records security lending income net of allocations to the security lending agent and the borrower.

The Fund may incur investment losses as a result of investing securities lending collateral. This could occur if an investment in the collateral investment account defaulted or became impaired. Under those circumstances, the value of the Fund’s cash collateral account may be less than the amount the Fund would be required to return to the borrowers of the securities and the Fund would be required to make up for this shortfall.

During the six months ended April 30, 2018, the Fund had no securities out on loan.

9. Credit and Market Risk

The Fund invested in growth stocks (such as those in the technology sector), which reflect projections of future earnings and revenue. These prices may rise or fall dramatically depending on whether those projections are met. These companies’ stock prices may be more volatile, particularly over the short term.

The Fund invests a significant portion of its assets in small- and mid-sized companies and may be subject to certain risks associated with ownership of securities of such companies. Investments in small- or mid-sized companies may be more volatile than investments in larger companies for a number of reasons, which include more limited financial resources or a dependence on narrow product lines.

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 is held by a smaller number of investors. This may limit the number of shares available for acquisition or disposition by the Fund.

Notes to financial statements

Delaware Select Growth Fund

9. Credit and Market Risk (continued)

The Fund may invest up to 15% of its net assets in illiquid securities, which may include securities with contractual restrictions on resale, securities exempt from registration under Rule 144A promulgated under 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. While maintaining oversight, the Fund’s Board has delegated to DMC, the day-to-day functions of determining whether individual securities are liquid for purposes of the Fund’s limitation on investments in illiquid securities. Securities eligible for resale pursuant to Rule 144A, which are determined to be liquid, are not subject to the Fund’s 15% limit on investments in illiquid securities. Rule 144A securities have been identified on the “Schedule of investments.” Restricted securities are valued pursuant to the security valuation procedures noted in Note 1.

10. 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.

11. Subsequent Events

Management has determined that no material events or transactions occurred subsequent to April 30, 2018, that would require recognition or disclosure in the Fund’s financial statements.

About the organization

This semiannual report is for the information of Delaware Select Growth Fund shareholders, but it may be used with prospective investors when preceded or accompanied by the Delaware Fund fact sheet for the most recently completed calendar quarter. These documents are available at delawarefunds.com/literature.

The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q, as well as a description of the policies and procedures that the Fund uses to determine how to vote proxies (if any) relating to portfolio securities are available without charge (i) upon request, by calling 800 523-1918; and (ii) on the SEC’s website at sec.gov. In addition, a description of the policies and procedures that the Fund uses to determine how to vote proxies (if any) relating to portfolio securities and the Schedule of Investments included in the Fund’s most recent Form N-Q are available without charge on the Fund’s website at delawarefunds.com/literature. The Fund’s Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C.; information on the operation of the Public Reference Room may be obtained by calling 800 SEC-0330.

Information (if any) regarding how the Fund voted proxies relating to portfolio securities during the most recently disclosed 12-month period ended June 30 is available without charge (i) through the Fund’s website at delawarefunds.com/proxy; and (ii) on the SEC’s website at sec.gov.

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. Investments

(a) Included as part of report to shareholders filed under Item 1 of this Form N-CSR.

(b) Divestment of securities in accordance with Section 13(c) of the Investment Company Act of 1940.

Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 11. 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 second fiscal quarter of the period covered by the report to stockholders included herein (i.e., the registrant’s second fiscal quarter) that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable.

Item 13. 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.

VOYAGEUR MUTUAL FUNDS III

SHAWN K. LYTLE
By:	Shawn K. Lytle
Title:	President and Chief Executive Officer
Date:	July 5, 2018

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.

SHAWN K. LYTLE
By:	Shawn K. Lytle
Title:	President and Chief Executive Officer
Date:	July 5, 2018


RICHARD SALUS
By:	Richard Salus
Title:	Chief Financial Officer
Date:	July 5, 2018

Board of trustees

Shawn K. Lytle
President and
Chief Executive Officer
Delaware Funds^®
by Macquarie
Philadelphia, PA

Thomas L. Bennett
Chairman of the Board
Delaware Funds
by Macquarie
Private Investor
Rosemont, PA

Ann D. Borowiec
Former Chief Executive
Officer
Private Wealth Management
J.P. Morgan Chase & Co.
New York, NY

Joseph W. Chow
Former Executive Vice
President
State Street Corporation
Boston, MA

John A. Fry
President
Drexel University
Philadelphia, PA

Lucinda S. Landreth
Former Chief Investment
Officer
Assurant, Inc.
New York, NY

Frances A.
Sevilla-Sacasa
Former Chief Executive
Officer
Banco Itaú International
Miami, FL

Thomas K. Whitford
Former Vice Chairman
PNC Financial Services Group
Pittsburgh, PA

Janet L. Yeomans
Former Vice President and Treasurer
3M Company
St. Paul, MN

Affiliated officers

David F. Connor
Senior Vice President,
General Counsel,
and Secretary
Delaware Funds
by Macquarie
Philadelphia, PA

Daniel V. Geatens
Vice President and
Treasurer
Delaware Funds
by Macquarie
Philadelphia, PA

Richard Salus
Senior Vice President and
Chief Financial Officer
Delaware Funds
by Macquarie
Philadelphia, PA