| 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 811-5021 |
| |
| DREYFUS PREMIER SHORT INTERMEDIATE MUNICIPAL BOND FUND |
| (Exact name of Registrant as specified in charter) |
| |
| |
| c/o The Dreyfus Corporation |
| 200 Park Avenue |
| New York, New York 10166 |
| (Address of principal executive offices) (Zip code) |
| |
| Mark N. Jacobs, Esq. |
| 200 Park Avenue |
| New York, New York 10166 |
| (Name and address of agent for service) |
| |
| Registrant's telephone number, including area code: (212) 922-6000 |
| Date of fiscal year end: | | 3/31 |
| Date of reporting period: | | 9/30/04 |
| | | | | FORM N-CSR |
| Item 1. | | Reports to Stockholders. | | |
| Dreyfus Premier |
| Short-Intermediate |
| Municipal Bond Fund |
SEMIANNUAL REPORT September 30, 2004
The views expressed in this report reflect those of the portfolio manager only through the end of the period covered and do not necessarily represent the views of Dreyfus or any other person in the Dreyfus organization. Any such views are subject to change at any time based upon market or other conditions and Dreyfus disclaims any responsibility to update such views.These views may not be relied on as investment advice and, because investment decisions for a Dreyfus fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Dreyfus fund.
Not FDIC-Insured • Not Bank-Guaranteed • May Lose Value
| Contents |
| |
| | | THE FUND |
| |
|
| 2 | | Letter from the Chairman |
| 3 | | Discussion of Fund Performance |
| 6 | | Understanding Your Fund’s Expenses |
| 6 | | Comparing Your Fund’s Expenses |
| With Those of Other Funds |
| 7 | | Statement of Investments |
| 16 | | Statement of Assets and Liabilities |
| 17 | | Statement of Operations |
| 18 | | Statement of Changes in Net Assets |
| 20 | | Financial Highlights |
| 24 | | Notes to Financial Statements |
| FOR MORE INFORMATION |
|
| | | Back Cover |
The Fund
| Dreyfus Premier |
| Short-Intermediate |
| Municipal Bond Fund |
LETTER FROM THE CHAIRMAN
Dear Shareholder:
This semiannual report for Dreyfus Premier Short-Intermediate Municipal Bond Fund covers the six-month period from April 1, 2004, through September 30, 2004. Inside, you’ll find valuable information about how the fund was managed during the reporting period, including a discussion with the fund’s portfolio manager, Monica Wieboldt.
The U.S. economy has alternated between signs of strength and weakness, causing heightened volatility in the municipal bond market. Although the Federal Reserve Board (the “Fed”) raised short-term interest rates three times during the reporting period, bond prices generally have held up better than many analysts expected, as investors apparently have revised their economic expectations in response to the insurgency in Iraq, higher energy prices and some disappointing labor statistics.
The Fed’s move to a less accommodative monetary policy may be signaling the beginning of a new phase in the economic cycle.At times such as these, when market conditions are in a period of transition, we believe it is especially important for investors to stay in close touch with their financial advisors.Your financial advisor can help you rebalance your portfolio in a way that is designed to respond to the challenges and opportunities of today’s changing investment environment.
Thank you for your continued confidence and support.
| The Dreyfus Corporation |
| October 15, 2004 |
2
DISCUSSION OF FUND PERFORMANCE
| Monica Wieboldt, Senior Portfolio Manager |
| |
| How did Dreyfus Premier Short-Intermediate Municipal Bond |
| Fund perform relative to its benchmark? |
For the six-month period ended September 30, 2004, the fund produced total returns of 0.27% for Class A shares, –0.05% for Class B shares, 0.41% for Class D shares and 0.27% for Class P shares.1 In comparison, the Lehman Brothers 3-Year Municipal Bond Index (the “Index”), the fund’s benchmark, provided a total return of 0.66% for the reporting period.2 In addition, the average total return during the same period for all funds reported in the Lipper Short Municipal Debt Funds category was 0.25% .3
The reporting period was characterized by heightened market volatility as investors’ expectations of economic growth and inflation continued to change.The fund produced higher returns than its Lipper category average for three of the four classes, partly due to its core holdings, which have provided higher yields than are available from newly issued securities. However, the fund underperformed the Index, which does not reflect fund fees and expenses.
What is the fund’s investment approach?
The fund seeks to maximize current income exempt from federal income tax to the extent consistent with the preservation of capital.
To pursue this goal, the fund normally invests substantially all of its assets in municipal bonds that provide income exempt from federal personal income tax. The fund will invest only in municipal bonds rated investment grade or the unrated equivalent as determined by Dreyfus. The fund invests primarily in municipal bonds with remaining maturities of five years or less and generally maintains a dollar-weighted average portfolio maturity of two to three years.
The portfolio manager may buy and sell bonds based on credit quality, market outlook and yield potential. In selecting municipal bonds for investment, the portfolio manager may assess the current interest-rate environment and the municipal bond’s potential volatility in
The Fund 3
DISCUSSION OF FUND PERFORMANCE (continued)
different rate environments. The portfolio manager focuses on bonds with the potential to offer attractive current income, typically looking for bonds that can provide consistently attractive current yields or that are trading at competitive market prices.A portion of the fund’s assets may be allocated to “discount” bonds, which are bonds that sell at a price below their face value, or to “premium” bonds, which are bonds that sell at a price above their face value.The fund’s allocation to either discount bonds or to premium bonds will change along with the portfolio manager’s changing views of the current interest-rate and market environment.The portfolio manager also may look to select bonds that are most likely to obtain attractive prices when sold.
What other factors influenced the fund’s performance?
The fund was influenced by heightened market volatility, especially during the first half of the reporting period, when reports of an unexpectedly strong U.S. labor market and higher energy prices rekindled investors’ inflation concerns. As investors in April and May revised forward their expectations of the timing of higher interest rates, municipal bond prices generally declined.
The Federal Reserve Board (the “Fed”) fulfilled investors’ revised expectations in late June, when it implemented its first increase in short-term interest rates in over four years. Additional rate hikes followed in August and September, and the reporting period ended with an overnight federal funds rate of 1.75% . At the same time, however, the U.S. economy hit a “soft patch” during the summer, and inflationary pressures appeared to be moderating.As a result, intermediate- and longer-term municipal bonds generally rallied, offsetting the reporting period’s earlier declines.
In this environment, rising yields on shorter-term bonds and declining yields on longer-term bonds led to a reduction in “spreads” along the short- to intermediate-term maturity spectrum. In addition, bond prices were supported by a relatively limited supply of new issues and robust demand from investors who were attracted by municipal bonds’ high after-tax returns relative to U.S.Treasury securities. Securities at the longer end of the intermediate-term range benefited most from these supply-and-demand dynamics.
4
As market condition evolved, we increased the fund’s holdings in the four- and five-year maturity range, and we focused on reducing holdings in the one- to two-year part of the maturity spectrum, where yield spreads tightened as the Fed raised rates. This shift benefited the fund’s performance as longer-term yields declined.We attempted to balance the fund’s longer-term holdings with investments in securities with maturities of less than one year, taking advantage of narrower yield differences among securities with maturities between one week and one year. We believed that securities in this range would be less sensitive to rising interest rates. Finally, during periods of market weakness, we attempted to increase the fund’s holdings of what we believed were higher-yielding bonds available at attractive prices, including securities from smaller issuers that large institutional investors may have overlooked.
What is the fund’s current strategy?
We have continued to seek out opportunities to provide an attractive yield while looking to manage volatility. As yield differences among short-term municipal securities narrow, we believe we should be able to increase the fund’s yield without a significant extension of the fund’s average duration. Unlike longer-term securities, the short-intermediate sector generally is subject to greater potential vulnerability to further moves by the Fed. Accordingly, as of the end of the reporting period, we are adopting an increasingly defensive position in anticipation of higher interest rates. In our view, these are prudent strategies in today’s evolving economic and market environments.
October 15, 2004
| 1 | | Total return includes reinvestment of dividends and any capital gains paid, and does not take into |
| | | consideration the maximum initial sales charge in the case of Class A shares, or the applicable |
| | | contingent deferred sales charge imposed on redemptions in the case of Class B shares. Had these |
| | | charges been reflected, returns would have been lower. Past performance is no guarantee of future |
| | | results. Share price, yield and investment return fluctuate such that upon redemption, fund shares |
| | | may be worth more or less than their original cost. Income may be subject to state and local taxes, |
| | | and some income may be subject to the federal alternative minimum tax (AMT) for certain |
| | | investors. Capital gains, if any, are fully taxable. |
| 2 | | SOURCE: LIPPER INC. — Reflects reinvestment of dividends and, where applicable, capital |
| | | gain distributions.The Lehman Brothers 3-Year Municipal Bond Index is an unmanaged total |
| | | return performance benchmark for the investment-grade, geographically unrestricted 3-year tax- |
| | | exempt bond market, consisting of municipal bonds with maturities of 2-4 years. Index returns do |
| | | not reflect the fees and expenses associated with operating a mutual fund. |
| 3 | | Source: Lipper Inc. |
The Fund 5
| | UNDERSTANDING YOUR FUND’S EXPENSES (Unaudited)
|
As a mutual fund investor, you pay ongoing expenses, such as management fees and other expenses. Using the information below, you can estimate how these expenses affect your investment and compare them with the expenses of other funds.You also may pay one-time transaction expenses, including sales charges (loads) and redemption fees, which are not shown in this section and would have resulted in higher total expenses. For more information, see your fund’s prospectus or talk to your financial adviser.
Review your fund’s expenses
The table below shows the expenses you would have paid on a $1,000 investment in Dreyfus Premier Short Intermediate Municipal Bond Fund from April 1, 2004 to September 30, 2004. It also shows how much a $1,000 investment would be worth at the close of the period, assuming actual returns and expenses.
| Expenses and Value of a $1,000 Investment | | | | | | |
| assuming actual returns for the six months ended September 30, 2004 | | | | |
| | | Class A | | Class B | | Class D | | Class P |
| |
| |
| |
| |
|
| Expenses paid per $1,000 † | | $ 4.32 | | $ 8.27 | | $ 3.67 | | $ 4.37 |
| Ending value (after expenses) | | $1,002.70 | | $999.50 | | $1,004.10 | | $1,002.70 |
| COMPARING YOUR FUND’S EXPENSES |
| WITH THOSE OF OTHER FUNDS (Unaudited) |
Using the SEC’s method to compare expenses
The Securities and Exchange Commission (SEC) has established guidelines to help investors assess fund expenses. Per these guidelines, the table below shows your fund’s expenses based on a $1,000 investment, assuming a hypothetical 5% annualized return. You can use this information to compare the ongoing expenses (but not transaction expenses or total costs) of investing in the fund with those of other funds.All mutual fund shareholder reports will provide this information to help you make this comparison. Please note that you cannot use this information to estimate your actual ending account balance and expenses paid during the period.
| Expenses and Value of a $1,000 Investment | | | | | | |
| assuming a hypothetical 5% annualized return for the six months ended September 30, 2004 |
| | | Class A | | Class B | | Class D | | Class P |
| |
| |
| |
| |
|
| Expenses paid per $1,000 † | | $ 4.36 | | $ 8.34 | | $ 3.70 | | $ 4.41 |
| Ending value (after expenses) | | $1,020.76 | | $1016.80 | | $1,021.41 | | $1,020.71 |
† Expenses are equal to the fund’s annualized expense ratio of .86% for Class A, 1.65% for Class B, .73% for Class D and .87% for Class P; multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).
6
| STATEMENT OF INVESTMENTS |
| September 30, 2004 (Unaudited) |
| | | Principal | | |
| Long-Term Municipal Investments—97.9% | | Amount ($) | | Value ($) |
| |
| |
|
| Alaska—1.0% | | | | |
| Alaska Housing Finance Corp. | | | | |
| (State Capital Project) 4%, 7/1/2005 (Insured; MBIA) | | 2,635,000 | | 2,681,376 |
| Arizona—1.8% | | | | |
| Maricopa County, Pollution Control Corp., PCR | | | | |
| (Southern California Edison Co.) 2.90%, 3/2/2009 | | 5,000,000 | | 4,920,700 |
| Arkansas—.8% | | | | |
| Arkansas Student Loan Authority, Revenue | | | | |
| (Student Loan) 5.35%, 6/1/2009 | | 2,000,000 | | 2,105,820 |
| California—6.3% | | | | |
| California: | | | | |
| 1.98%, 2/3/2005 | | 4,250,000 | | 4,250,000 |
| Economic Recovery 5%, 7/1/2008 | | 2,000,000 | | 2,184,340 |
| California Department of Water Resources, Power | | | | |
| Supply Revenue 5.25%, 5/1/2007 (Insured; MBIA) | | 2,500,000 | | 2,700,775 |
| California Pollution Control Financing Authority, | | | | |
| PCR (Southern California Edison Co.) 2%, 3/1/2006 | | 3,500,000 | | 3,480,645 |
| California Statewide Communities Development Authority, | | |
| COP (The Internext Group) 4.25%, 4/1/2005 | | 1,975,000 | | 1,989,931 |
| Redding, Electric System Revenue, COP | | | | |
| 9.613%, 6/1/2005 (Insured; FGIC) | | 550,000 a | | 564,245 |
| San Diego County, COP | | | | |
| (Burnham Institute) 5.15%, 9/1/2006 | | 400,000 | | 416,668 |
| Truckee-Donner Public Utility District, COP: | | | | |
| 3%, 1/1/2005 | | 500,000 | | 501,035 |
| 4%, 1/1/2007 | | 1,000,000 | | 1,026,210 |
| Colorado—1.5% | | | | |
| Countrydale Metropolitan District | | | | |
| 3.50%, 12/1/2007 (LOC; Compass Bank) | | 3,000,000 | | 3,046,860 |
| Mesa County Valley School District Number 51, COP | | | | |
| 4%, 12/1/2004 | | 1,000,000 | | 1,002,640 |
| Connecticut—.9% | | | | |
| Greenwich Housing Authority, MFHR (Greenwich Close): | | | | |
| 5.95%, 9/1/2006 | | 310,000 | | 317,161 |
| 6.05%, 9/1/2007 | | 330,000 | | 340,418 |
| Mashantucket Western Pequot Tribe, Special Revenue | | | | |
| 6.50%, 9/1/2005 | | 1,260,000 | | 1,307,086 |
| Mohegan Tribe of Indians of Connecticut Gaming | | | | |
| Authority, Priority Distribution Payment, | | | | |
| Public Improvement 5%, 1/1/2008 | | 500,000 | | 531,465 |
S T A T E M E N T O F I N V E S T M E N T S ( U n a u d i t e d ) (continued)
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| District of Columbia—1.6% | | | | |
| District of Columbia: | | | | |
| 5%, 6/1/2005 | | 500,000 | | 510,865 |
| COP 5%, 1/1/2005 (Insured; AMBAC) | | 1,000,000 | | 1,008,060 |
| Tax Increment Revenue (Mandarin Oriental) | | | | |
| Zero Coupon, 7/1/2005 (Insured; FSA) | | 2,890,000 | | 2,852,979 |
| Florida—4.5% | | | | |
| Highlands County Health Facilities Authority, Revenue | | | | |
| (Adventist Health/Sunbelt) 3.35%, 9/1/2005 | | 4,000,000 | | 4,050,360 |
| Hillsborough County Industrial Development Authority, | | | | |
| HR (Tampa General Hospital Project) 4%, 10/1/2006 | | 1,640,000 | | 1,689,544 |
| Lee County Industrial Development Authority, | | | | |
| Health Care Facilities Revenue (Cypress | | | | |
| Cove Healthpack) 5.875%, 10/1/2004 | | 2,000,000 | | 1,999,960 |
| Miami-Dade County, Aviation Revenue | | | | |
| 5.25%, 10/1/2008 (Insured; FGIC) | | 2,000,000 | | 2,187,100 |
| Tampa, Revenue (Health System- | | | | |
| Catholic Health) 5%, 11/15/2009 | | 1,000,000 | | 1,096,970 |
| West Orange Healthcare District, Revenue | | | | |
| 5.30%, 2/1/2007 | | 1,155,000 | | 1,231,727 |
| Georgia—1.0% | | | | |
| Development Authority of the City of Milledgeville | | | | |
| and Baldwin County, Revenue (Georgia College | | | | |
| and State University Foundation Property III, | | | | |
| LLC Student Housing System Project): | | | | |
| 5%, 9/1/2007 | | 640,000 | | 673,971 |
| 5%, 9/1/2008 | | 835,000 | | 883,714 |
| 5%, 9/1/2009 | | 1,045,000 | | 1,106,038 |
| Hawaii—.5% | | | | |
| Kuakini, Health System Special Purpose Revenue | | | | |
| 5%, 7/1/2007 | | 1,235,000 | | 1,275,113 |
| Illinois—4.4% | | | | |
| Alton, Hospital Facility Revenue (Saint | | | | |
| Anthonys Health Center) 5.875%, 9/1/2006 | | 830,000 | | 855,581 |
| Chicago Housing Authority, Capital Program Revenue | | | | |
| 5%, 7/1/2006 | | 4,000,000 | | 4,191,040 |
| Chicago Wastewater Transmission, Revenue | | | | |
| 5.30%, 1/1/2005 (Insured; FGIC) | | 2,000,000 | | 2,018,400 |
| Flora, Revenue (Heritage Woods Project) | | | | |
| 3.75%, 10/23/2004 (LOC; FHLB) | | 3,250,000 | | 3,263,683 |
| Northern Illinois University, Revenues (Auxilary Facilities | | | | |
| System) Zero Coupon, 4/1/2006 (Insured; FGIC) | | 1,865,000 | | 1,810,318 |
8
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| Indiana—2.6% | | | | |
| Indiana Development Finance Authority, SWDR | | | | |
| (Waste Management Inc., Project) 2.70%, 10/1/2004 | | 2,000,000 b | | 1,999,600 |
| Indiana Health Facility Financing Authority, HR | �� | | | |
| (Methodist Hospital Inc.) 5%, 9/15/2005 | | 1,000,000 | | 1,027,590 |
| Purdue University, University Revenues | | | | |
| (Purdue University Student Facilities System) | | | | |
| 5%, 7/1/2006 | | 3,755,000 | | 3,953,640 |
| Iowa—6.0% | | | | |
| Ankeny Community School District, Sales and Services | | | | |
| Tax Revenue (School Infrastructure) 4%, 7/1/2006 | | 2,560,000 | | 2,640,307 |
| Eddyville, PCR (Cargill Inc. Project) | | | | |
| 5.40%, 10/1/2006 | | 2,760,000 | | 2,931,286 |
| Iowa Student Loan Liquidity Corp., | | | | |
| Student Loan Revenue: | | | | |
| 7.823%, 12/1/2005 | | 5,000,000 a,c | | 5,333,550 |
| 4.55%, 12/1/2007 (Insured; AMBAC) | | 3,000,000 | | 3,155,820 |
| Polk County, Revenue (Catholic Health Initiatives) | | | | |
| 4.55%, 12/1/2004 | | 2,405,000 | | 2,416,424 |
| Kansas—1.5% | | | | |
| Burlington, EIR (Kansas City Power and Light): | | | | |
| 4.75%, Series A, 10/1/2007 | | 1,000,000 | | 1,052,040 |
| 4.75%, Series B, 10/1/2007 | | 2,000,000 | | 2,104,080 |
| 4.75%, Series D, 10/1/2007 | | 1,000,000 | | 1,052,040 |
| Louisiana—3.7% | | | | |
| Calcasieu Parish Industrial Development Board, PCR | | | | |
| (Occidental Petroleum Project) 4.80%, 12/1/2006 | | 3,000,000 | | 3,134,550 |
| Louisiana Correctional Facilities Corp., LR | | | | |
| 5%, 12/15/2004 | | 2,000,000 | | 2,013,140 |
| Saint Charles Parish, PCR (Entergy | | | | |
| Louisiana Inc. Project) 4.90%, 6/1/2005 | | 4,900,000 | | 4,965,562 |
| Massachusetts—2.4% | | | | |
| Massachusetts Development Finance Agency: | | | | |
| EIR (Mead Westvaco Corp.) 2.25%, 11/1/2004 | | 1,000,000 | | 999,930 |
| RRR (Semass System) 5%, 1/1/2005 (Insured; MBIA) | | 4,000,000 | | 4,030,720 |
| Massachusetts Health and Educational Facilities | | | | |
| Authority, Revenue (Partners Healthcare System) | | | | |
| 5%, 7/1/2008 | | 1,500,000 | | 1,631,235 |
| Michigan—5.3% | | | | |
| Eaton County, Temporary Notes (Carrier Creek | | | | |
| Drain Number 326) 2.75%, 12/1/2006 | | 2,000,000 | | 2,002,900 |
S T A T E M E N T O F I N V E S T M E N T S ( U n a u d i t e d ) (continued)
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| Michigan (continued) | | | | |
| Michigan Hospital Finance Authority: | | | | |
| (Henry Ford Health System) 5%, 3/1/2005 | | 1,000,000 | | 1,012,530 |
| (Sparrow Obligation Group): | | | | |
| 5%, 11/15/2005 | | 1,250,000 | | 1,289,575 |
| 5%, 11/15/2006 | | 1,500,000 | | 1,577,610 |
| 5.25%, 11/15/2008 | | 3,000,000 | | 3,247,830 |
| University of Michigan, University Revenues | | | | |
| (Hospital) 5%, 12/1/2006 | | 5,100,000 | | 5,408,907 |
| Mississippi—1.2% | | | | |
| Mississippi (Gaming Counties | | | | |
| Highway Improvements Project) | | | | |
| 5%, 10/1/2008 (Insured; AMBAC) | | 3,000,000 | | 3,288,180 |
| Nebraska—1.2% | | | | |
| University of Nebraska, University Revenues | | | | |
| (Lincoln Memorial Stadium) | | | | |
| 5%, 11/1/2007 | | 3,035,000 | | 3,267,390 |
| Nevada—1.1% | | | | |
| Washoe County Airport Authority, | | | | |
| Airport System Improvement Revenue | | | | |
| 5%, 7/1/2005 (Insured; FGIC) | | 3,025,000 | | 3,096,632 |
| New Hampshire—.7% | | | | |
| New Hampshire Business Finance Authority, | | | | |
| PCR (United Illuminating ) | | | | |
| 3.50%, 2/1/2009 | | 2,000,000 | | 2,000,100 |
| New Jersey—5.3% | | | | |
| New Jersey Economic Development Authority, Revenue: | | | | |
| Construction 5%, 6/15/2008 | | 6,000,000 | | 6,526,080 |
| Department of Human Services (Pooled Financing) | | | | |
| 4%, 7/1/2005 | | 1,350,000 | | 1,371,209 |
| First Mortgage (Cadbury Corp. Project) | | | | |
| 4.65%, 7/1/2006 (Insured; ACA) | | 1,565,000 | | 1,605,956 |
| Market Transition Facility | | | | |
| 5%, 7/1/2005 (Insured; MBIA) | | 2,500,000 | | 2,562,250 |
| Union County Utilities Authority, Solid Waste Revenue | | | | |
| Senior Lease (Ogden Martin) | | | | |
| 5.50%, 6/1/2008 (Insured; AMBAC) | | 2,240,000 | | 2,453,360 |
| New Mexico—.7% | | | | |
| Jicarilla Apache Nation, Revenue 4%, 9/1/2008 | | 765,000 | | 794,743 |
| New Mexico Financing Authority, Revenue Public Project | | | | |
| Revolving Fund) 4%, 6/1/2007 (Insured; AMBAC) | | 1,145,000 | | 1,201,494 |
10
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| New York—11.1% | | | | |
| Dutchess County Industrial Development Agency, | | | | |
| IDR (IBM Project) 5.45%, 12/1/2009 | | 2,000,000 | | 2,200,140 |
| Long Island Power Authority, | | | | |
| Electric System Revenue | | | | |
| 4.50%, 6/1/2005 | | 2,250,000 | | 2,288,183 |
| New York City 5%, 8/1/2006 | | 1,500,000 | | 1,579,080 |
| New York State 5.625%, 8/15/2009 | | 5,000,000 | | 5,213,750 |
| New York State Dormitory Authority: | | | | |
| (City University System Consolidated Fifth | | | | |
| General Resolution Revenue) | | | | |
| 5.25%, 1/1/2009 | | 2,000,000 | | 2,192,140 |
| LR (Court Facilities Lease-New York City Issue) | | | | |
| 5%, 5/15/2007 | | 3,500,000 | | 3,740,310 |
| (South Nassau Communities Hospital) | | | | |
| 5.25%, 7/1/2009 | | 945,000 | | 1,023,019 |
| New York State Urban Development Corp., | | | | |
| Correctional and Youth Facilities, | | | | |
| Service Contract Revenue | | | | |
| (Empire State Development Corp.) | | | | |
| 5.25%, 1/1/2009 | | 2,000,000 | | 2,188,940 |
| Port Authority of New York and New Jersey, | | | | |
| Special Obligation Revenue, (Special Project— | | | | |
| JFK International Air Terminal 6) | | | | |
| 6.25%, 12/1/2008 (Insured; MBIA) | | 2,000,000 | | 2,239,380 |
| Tobacco Settlement Financing Corp., | | | | |
| Revenue Asset Backed: | | | | |
| 5%, 6/1/2006 | | 1,200,000 | | 1,257,696 |
| 4%, 6/1/2007 | | 4,275,000 | | 4,444,632 |
| 5%, 6/1/2007 | | 2,000,000 | | 2,133,400 |
| North Carolina—.6% | | | | |
| North Carolina Medical Care Commission | | | | |
| Retirement Facilities, Revenue, First Mortgage | | | | |
| (Cypress Glen) 3.80%, 10/1/2007 | | 1,500,000 | | 1,509,210 |
| Ohio—3.5% | | | | |
| Hamilton County Local District, Cooling Facilities | | | | |
| Revenue (Trigen Cinergy) 4.60%, 6/1/2009 | | 2,000,000 | | 2,050,800 |
| Lorain County, HR, Improvement | | | | |
| (Catholic Healthcare): | | | | |
| 5%, 10/1/2006 | | 3,655,000 | | 3,851,127 |
| 5.25%, 10/1/2007 | | 3,515,000 | | 3,783,968 |
S T A T E M E N T O F I N V E S T M E N T S ( U n a u d i t e d ) (continued)
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| Oklahoma—3.3% | | | | |
| Oklahoma Development Finance Authority, LR: | | | | |
| (Master Oklahoma State System Higher Education) | | | | |
| 4%, 6/1/2006 | | 1,000,000 | | 1,033,420 |
| (Oklahoma State System Higher Education) | | | | |
| 3%, 12/1/2008 (Insured; MBIA) | | 1,000,000 | | 1,016,120 |
| Tulsa County Independent School District: | | | | |
| 4%, 7/1/2005 | | 1,125,000 | | 1,144,721 |
| 4%, 7/1/2006 | | 1,125,000 | | 1,166,603 |
| 4%, 7/1/2007 | | 1,125,000 | | 1,182,622 |
| 4%, 7/1/2008 | | 1,160,000 | | 1,225,552 |
| Tulsas Port Catoosa Facilities Authority, Revenue | | | | |
| (Cargill Inc. Project) 5.35%, 9/1/2006 | | 2,100,000 | | 2,224,068 |
| Pennsylvania—4.0% | | | | |
| Allegheny County, Airport Revenue | | | | |
| (Pittsburgh International Airport) | | | | |
| 5.75%, 1/1/2006 (Insured; MBIA) | | 2,000,000 | | 2,086,040 |
| Delaware County Industrial Development Authority, | | | | |
| PCR (Peco Energy Co. Project) | | | | |
| 5.20%, 10/1/2004 | | 3,000,000 | | 3,000,210 |
| Montgomery County Industrial Development Authority, | | | | |
| PCR (Peco Energy Co. Project) | | | | |
| 5.30%, 10/1/2004 | | 3,380,000 | | 3,380,237 |
| Philadelphia Hospitals and Higher Education | | | | |
| Facilities Authority, Revenue (Health System) | | | | |
| 5%, 5/15/2009 (Insured; FGIC) | | 2,310,000 | | 2,496,648 |
| Rhode Island—.4% | | | | |
| Rhode Island Health and Educational Building Corp., | | | | |
| Revenue (Hospital Financing) | | | | |
| 3%, 9/1/2006 (LOC; Fleet National Bank) | | 1,165,000 | | 1,183,419 |
| South Carolina—.8% | | | | |
| College of Charleston, Higher Education Facilities Revenue: | | |
| 4%, 10/1/2004 (Insured; FGIC) | | 1,100,000 | | 1,100,077 |
| 4%, 10/1/2005 (Insured; FGIC) | | 1,145,000 | | 1,170,900 |
| Texas—3.5% | | | | |
| Gulf Coast Waste Disposal Authority, | | | | |
| SWDR (Quaker Oats Co. Project) | | | | |
| 5.70%, 5/1/2006 | | 2,750,000 | | 2,888,105 |
| Houston Water and Sewer System, Revenue | | | | |
| 5%, 12/1/2005 (Insured; MBIA) | | 2,355,000 | | 2,445,526 |
| Matagorda County Navigation District Number 1, PCR | | | | |
| (Central Power) 2.15%, 11/1/2004 | | 2,000,000 | | 1,999,480 |
12
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| Texas (continued) | | | | |
| North Central Texas Health Facility Development Corp., | | | | |
| Revenue (Baylor Health Care System Project) | | | | |
| 5.50%, 5/15/2007 | | 2,000,000 | | 2,153,580 |
| Utah—.9% | | | | |
| Utah Board of Regents, Student Loan Revenue | | | | |
| 5%, 5/1/2006 | | 2,310,000 | | 2,406,673 |
| Virginia—9.8% | | | | |
| Fairfax County, Public Improvement | | | | |
| 4%, 6/1/2005 | | 10,000,000 | | 10,159,800 |
| Fairfax County Economic Development Authority, RRR | | | | |
| 5.85%, 2/1/2006 (Insured; AMBAC) | | 4,000,000 | | 4,205,760 |
| Fredericksburg Industrial Development Authority, | | | | |
| Hospital Facilities Revenue (Medicorp | | | | |
| Health System) 5%, 8/15/2006 | | 1,665,000 | | 1,749,848 |
| Hopewell, Public Improvement | | | | |
| 5%, 7/15/2009 | | 3,250,000 | | 3,446,495 |
| Roanoke Industrial Development Authority, HR | | | | |
| (Carilion Health System) 4%, 7/1/2006 | | 3,235,000 | | 3,347,222 |
| Southwest Virginia Regional Jail Authority, | | | | |
| Jail Facilities Grant Anticipation Notes | | | | |
| 3%, 9/1/2006 (Insured; MBIA) | | 4,000,000 | | 4,038,080 |
| Washington—1.0% | | | | |
| Energy Northwest, Wind Project Revenue | | | | |
| 4.30%, 7/1/2005 | | 615,000 | | 623,044 |
| Washington, COP | | | | |
| (Department of Ecology) | | | | |
| 4.50%, 4/1/2008 (Insured; AMBAC) | | 1,000,000 | | 1,067,540 |
| Washington Public Power Supply System | | | | |
| (Nuclear Project Number 2 Revenue) | | | | |
| 5.75%, 7/1/2009 | | 1,000,000 | | 1,130,620 |
| Wisconsin—1.8% | | | | |
| Badger Tobacco Asset Securitization Corp., | | | | |
| Tobacco Settlement Asset-Backed Bonds | | | | |
| 5.50%, 6/1/2006 | | 2,000,000 | | 2,046,820 |
| Racine, SWDR (Republic Services Project) | | | | |
| 3.25%, 4/1/2009 | | 3,000,000 | | 2,966,280 |
| U.S. Related—1.2% | | | | |
| Puerto Rico Public Buildings Authority, | | | | |
| Revenue (Government Facilities) | | | | |
| 4.50%, 7/1/2007 | | 2,000,000 | | 2,106,680 |
S T A T E M E N T O F I N V E S T M E N T S ( U n a u d i t e d ) (continued)
| | | Principal | | |
| Long-Term Municipal Investments (continued) | | Amount ($) | | Value ($) |
| |
| |
|
| U.S. Related (continued) | | | | |
| Virgin Islands Public Finance Authority, Revenue | | | | |
| 6%, 10/1/2006 | | 1,220,000 | | 1,284,672 |
| Total Long-Term Municipal Investments | | | | |
| (cost $265,876,690) | | | | 268,393,695 |
| |
| |
|
| |
| Short-Term Municipal Investments—1.4% | | | | |
| |
| |
|
| Connecticut; | | | | |
| Connecticut Health and Educational Facilities Authority, | | | | |
| Revenue, VRDN (Quinnipac University) | | | | |
| 1.69% (Insured; AGIC) (cost $4,000,000) | | 4,000,000 d | | 4,000,000 |
| |
| |
|
| Total Investments (cost $269,876,690) | | 99.3% | | 272,393,695 |
| Cash and Receivables (Net) | | .7% | | 1,791,559 |
| Net Assets | | 100.0% | | 274,185,254 |
14
| Summary of Abbreviations | | | | |
| |
| ACA | | American Capital Access | | HR | | Hospital Revenue |
| AGIC | | Asset Guaranty Insurance | | IDR | | Industrial Development Revenue |
| | | Company | | LOC | | Letter of Credit |
| AMBAC | | American Municipal Bond | | LR | | Lease Revenue |
| | | Assurance Corporation | | MBIA | | Municipal Bond Investors |
| COP | | Certificate of Participation | | | | Assurance Insurance |
| EIR | | Environmental Improvement | | | | Corporation |
| | | Revenue | | MFHR | | Multi-Family Housing Revenue |
| FGIC | | Financial Guaranty Insurance | | PCR | | Pollution Control Revenue |
| | | Company | | RRR | | Resources Recovery Revenue |
| FHLB | | Federal Home Loan Bank | | SWDR | | Solid Waste Disposal Revenue |
| FSA | | Financial Security Assurance | | VRDN | | Variable Rate Demand Notes |
| Summary of Combined Ratings (Unaudited) | | |
| |
| Fitch | | or | | Moody’s | | or | | Standard & Poor’s | | Value (%) † |
| |
| |
| |
| |
| |
|
| AAA | | | | Aaa | | | | AAA | | 26.9 |
| AA | | | | Aa | | | | AA | | 24.7 |
| A | | | | A | | | | A | | 30.9 |
| BBB | | | | Baa | | | | BBB | | 11.3 |
| F1 | | | | MIG1/P1 | | | | SP1/A1 | | 4.2 |
| Not Rated e | | | | Not Rated e | | | | Not Rated e | | 2.0 |
| | | | | | | | | | | 100.0 |
| † Based on total investments. |
| a Inverse Floater Security—the interest rate is subject to change periodically. |
| b Purchased on a delayed delivery basis. |
| c Securities exempt from registration under Rule 144A of the Securities Act of 1933.These securities may be |
| resold in transactions exempt from registration, normally to qualified institutional buyers.These securities have |
| been determined to be liquid by the Board of Trustees. At September 30, 2004, these securities amounted to |
| $5,333,550 or 1.9% of net assets. |
| d Securities payable on demand.Variable interest rate—subject to periodic change. |
| e Securities which, while not rated by Fitch, Moody’s and Standard & Poor’s, have been determined by the Manager to |
| be of comparable quality to those rated securities in which the fund may invest. |
See notes to financial statements.
| STATEMENT OF ASSETS AND LIABILITIES |
| September 30, 2004 (Unaudited) |
| | | Cost | | Value |
| |
| |
|
| Assets ($): | | | | |
| Investments in securities—See Statement of Investments | | 269,876,690 | | 272,393,695 |
| Cash | | | | 1,474,484 |
| Interest receivable | | | | 3,782,564 |
| Receivable for shares of Beneficial Interest subscribed | | | | 17,406 |
| Prepaid expenses | | | | 27,283 |
| | | | | 277,695,432 |
| |
| |
|
| Liabilities ($): | | | | |
| Due to The Dreyfus Corporation and affiliates—Note 3(c) | | | | 139,244 |
| Payable for investment securities purchased | | | | 3,255,363 |
| Payable for shares of Beneficial Interest redeemed | | | | 85,841 |
| Accrued expenses | | | | 29,730 |
| | | | | 3,510,178 |
| |
| |
|
| Net Assets ($) | | | | 274,185,254 |
| |
| |
|
| Composition of Net Assets ($): | | | | |
| Paid-in capital | | | | 277,097,028 |
| Accumulated undistributed investment income—net | | | | 89,221 |
| Accumulated net realized gain (loss) on investments | | | | (5,518,000) |
| Accumulated net unrealized appreciation | | | | |
| (depreciation) on investments | | | | 2,517,005 |
| |
| |
|
| Net Assets ($) | | | | 274,185,254 |
| Net Asset Value Per Share | | | | | | | | |
| | | Class A | | Class B | | Class D | | Class P |
| |
| |
| |
| |
|
| Net Assets ($) | | 12,816,992 | | 2,221,636 | | 255,339,960 | | 3,806,666 |
| Shares Outstanding | | 999,597 | | 173,209 | | 19,905,665 | | 296,630 |
| |
| |
| |
| |
|
| Net Asset Value Per Share ($) | | 12.82 | | 12.83 | | 12.83 | | 12.83 |
See notes to financial statements.
16
STATEMENT OF OPERATIONS
Six Months Ended September 30, 2004 (Unaudited)
|
| Investment Income ($): | | |
| Interest Income | | 4,359,320 |
| Expenses: | | |
| Management fee—Note 3(a) | | 701,126 |
| Distribution fees—Note 3(b) | | 138,732 |
| Shareholder servicing costs—Note 3(c) | | 103,943 |
| Registration fees | | 34,530 |
| Professional fees | | 24,160 |
| Custodian fees | | 17,063 |
| Prospectus and shareholders’ reports | | 12,039 |
| Trustees’ fees and expenses—Note 3(d) | | 4,979 |
| Loan commitment fees—Note 2 | | 897 |
| Miscellaneous | | 13,626 |
| Total Expenses | | 1,051,095 |
| Less—reduction in custody fees | | |
| due to earnings credits—Note 1(b) | | (5,491) |
| Net Expenses | | 1,045,604 |
| Investment Income—Net | | 3,313,716 |
| |
|
| Realized and Unrealized Gain (Loss) on Investments—Note 4 ($): |
| Net realized gain (loss) on investments | | 415,425 |
| Net unrealized appreciation (depreciation) on investments | | (2,813,063) |
| Net Realized and Unrealized Gain (Loss) on Investments | | (2,397,638) |
| Net Increase in Net Assets Resulting from Operations | | 916,078 |
See notes to financial statements.
STATEMENT OF CHANGES IN NET ASSETS
| | | Six Months Ended | | |
| | | September 30, 2004 | | Year Ended |
| | | (Unaudited) | | March 31, 2004 |
| |
| |
|
| Operations ($): | | | | |
| Investment income—net | | 3,313,716 | | 8,227,953 |
| Net realized gain (loss) on investments | | 415,425 | | 1,612,855 |
| Net unrealized appreciation | | | | |
| (depreciation) on investments | | (2,813,063) | | (2,853,002) |
| Net Increase (Decrease) in Net Assets | | | | |
| Resulting from Operations | | 916,078 | | 6,987,806 |
| |
| |
|
| Dividends to Shareholders from ($): | | | | |
| Investment income—net: | | | | |
| Class A shares | | (131,508) | | (187,323) |
| Class B shares | | (14,155) | | (12,100) |
| Class D shares | | (3,113,023) | | (7,946,793) |
| Class P shares | | (43,088) | | (58,051) |
| Total Dividends | | (3,301,774) | | (8,204,267) |
| |
| |
|
| Beneficial Interest Transactions ($): | | | | |
| Net proceeds from shares sold: | | | | |
| Class A shares | | 5,972,200 | | 13,598,335 |
| Class B shares | | 1,395,849 | | 1,386,600 |
| Class D shares | | 23,508,161 | | 63,544,078 |
| Class P shares | | 806,000 | | 4,817,438 |
| Dividends reinvested: | | | | |
| Class A shares | | 115,624 | | 145,214 |
| Class B shares | | 10,481 | | 9,342 |
| Class D shares | | 2,666,575 | | 6,841,893 |
| Class P shares | | 35,518 | | 48,998 |
| Cost of shares redeemed: | | | | |
| Class A shares | | (2,723,361) | | (4,317,986) |
| Class B shares | | (469,686) | | (208,007) |
| Class D shares | | (45,525,985) | | (113,596,902) |
| Class P shares | | (591,990) | | (1,268,925) |
| Increase (Decrease) in Net Assets | | | | |
| from Beneficial Interest Transactions | | (14,800,614) | | (28,999,922) |
| Total Increase (Decrease) in Net Assets | | (17,186,310) | | (30,216,383) |
| |
| |
|
| Net Assets ($): | | | | |
| Beginning of Period | | 291,371,564 | | 321,587,947 |
| End of Period | | 274,185,254 | | 291,371,564 |
| Undistributed investment income—net | | 89,221 | | — |
18
| | | Six Months Ended | | |
| | | September 30, 2004 | | Year Ended |
| | | (Unaudited) | | March 31, 2004 |
| |
| |
|
| Capital Share Transactions: | | | | |
| Class Aa | | | | |
| Shares sold | | 467,566 | | 1,050,211 |
| Shares issued for dividends reinvested | | 9,040 | | 11,218 |
| Shares redeemed | | (213,132) | | (333,157) |
| Net Increase (Decrease) in Shares Outstanding | | 263,474 | | 728,272 |
| |
| |
|
| Class B a | | | | |
| Shares sold | | 109,164 | | 107,110 |
| Shares issued for dividends reinvested | | 819 | | 721 |
| Shares redeemed | | (36,700) | | (16,066) |
| Net Increase (Decrease) in Shares Outstanding | | 73,283 | | 91,765 |
| |
| |
|
| Class D | | | | |
| Shares sold | | 1,836,666 | | 4,902,719 |
| Shares issued for dividends reinvested | | 208,445 | | 527,858 |
| Shares redeemed | | (3,556,817) | | (8,765,084) |
| Net Increase (Decrease) in Shares Outstanding | | (1,511,706) | | (3,334,507) |
| |
| |
|
| Class P | | | | |
| Shares sold | | 62,673 | | 371,482 |
| Shares issued for dividends reinvested | | 2,775 | | 3,782 |
| Shares redeemed | | (46,115) | | (98,044) |
| Net Increase (Decrease) in Shares Outstanding | | 19,333 | | 277,220 |
a During the period ended September 30, 2004, 412 Class B shares representing $5,268 were automatically converted to 412 Class A shares and during the period ended March 31, 2004, 16,012 Class B shares representing $207,307 were automaticaly converted to 16,013 class A shares.
See notes to financial statements.
FINANCIAL HIGHLIGHTS
The following tables describe the performance for each share class for the fiscal periods indicated.All information (except portfolio turnover rate) reflects financial results for a single fund share.Total return shows how much your investment in the fund would have increased (or decreased) during each period, assuming you had reinvested all dividends and distributions.These figures have been derived from the fund’s financial statements.
| | | Six Months Ended | | | | |
| | | September 30, 2004 | | Year Ended March 31, |
| | | |
|
| Class A Shares | | (Unaudited) | | 2004 | | 2003 a |
| |
| |
| |
|
| Per Share Data ($): | | | | | | |
| Net asset value, beginning of period | | 12.93 | | 12.98 | | 13.06 |
| Investment Operations: | | | | | | |
| Investment income—net b | | .14 | | .33 | | .02 |
| Net realized and unrealized | | | | | | |
| gain (loss) on investments | | (.11) | | (.05) | | (.08) |
| Total from Investment Operations | | .03 | | .28 | | (.06) |
| Distributions: | | | | | | |
| Dividends from investment income—net | | (.14) | | (.33) | | (.02) |
| Net asset value, end of period | | 12.82 | | 12.93 | | 12.98 |
| |
| |
| |
|
| Total Return (%) c | | .27d | | 2.17 | | (.46)d |
| |
| |
| |
|
| Ratios/Supplemental Data (%): | | | | | | |
| Ratio of total expenses to average net assets | | .86e | | .87 | | 1.14e |
| Ratio of net investment income | | | | | | |
| to average net assets | | 2.24e | | 2.47 | | 3.25e |
| Portfolio Turnover Rate | | 20.00d | | 38.06 | | 77.91 |
| |
| |
| |
|
| Net Assets, end of period ($ x 1,000) | | 12,817 | | 9,516 | | 102 |
| a | | From March 12, 2003 (commencement of initial offering) to March 31, 2003. |
| b | | Based on average shares outstanding at each month end. |
| c | | Exclusive of sales charge. |
| d | | Not annualized. |
| e | | Annualized. |
See notes to financial statements.
20
| | | Six Months Ended | | | | |
| | | September 30, 2004 | | Year Ended March 31, |
| | | |
|
| Class B Shares | | (Unaudited) | | 2004 | | 2003 a |
| |
| |
| |
|
| Per Share Data ($): | | | | | | |
| Net asset value, beginning of period | | 12.93 | | 12.98 | | 13.06 |
| Investment Operations: | | | | | | |
| Investment income—net b | | .10 | | .22 | | .01 |
| Net realized and unrealized | | | | | | |
| gain (loss) on investments | | (.11) | | (.05) | | (.08) |
| Total from Investment Operations | | (.01) | | .17 | | (.07) |
| Distributions: | | | | | | |
| Dividends from investment income—net | | (.09) | | (.22) | | (.01) |
| Net asset value, end of period | | 12.83 | | 12.93 | | 12.98 |
| |
| |
| |
|
| Total Return (%) c | | (.05)d | | 1.35 | | (.50)d |
| |
| |
| |
|
| Ratios/Supplemental Data (%): | | | | | | |
| Ratio of total expenses to average net assets | | 1.65e | | 1.69 | | 1.83e |
| Ratio of net investment income | | | | | | |
| to average net assets | | 1.46e | | 1.67 | | 1.91e |
| Portfolio Turnover Rate | | 20.00d | | 38.06 | | 77.91 |
| |
| |
| |
|
| Net Assets, end of period ($ x 1,000) | | 2,222 | | 1,292 | | 106 |
| a | | From March 12, 2003 (commencement of initial offering) to March 31, 2003. |
| b | | Based on average shares outstanding at each month end. |
| c | | Exclusive of sales charge. |
| d | | Not annualized. |
| e | | Annualized. |
See notes to financial statements.
FINANCIAL HIGHLIGHTS (continued)
| Six Months Ended | | | | | | | | | | |
| September 30, 2004 | | | | Year Ended March 31, | | |
| |
| |
| |
|
| Class D Shares | | (Unaudited) | | 2004 | | 2003 a | | 2002 b | | 2001 | | 2000 |
| |
| |
| |
| |
| |
| |
|
| Per Share Data ($): | | | | | | | | | | | | |
| Net asset value, | | | | | | | | | | | | |
| beginning of period | | 12.93 | | 12.98 | | 12.91 | | 13.01 | | 12.81 | | 13.08 |
| Investment Operations: | | | | | | | | | | | | |
| Investment income—net | | .15c | | .35c | | .43c | | .52c | | .55 | | .54 |
| Net realized and unrealized | | | | | | | | | | | | |
| gain (loss) on investments | | (.10) | | (.05) | | .08 | | (.10) | | .20 | | (.27) |
| Total from Investment Operations | | .05 | | .30 | | .51 | | .42 | | .75 | | .27 |
| Distributions: | | | | | | | | | | | | |
| Dividends from investment | | | | | | | | | | | | |
| income—net | | (.15) | | (.35) | | (.44) | | (.52) | | (.55) | | (.54) |
| Dividends from net realized | | | | | | | | | | | | |
| gain on investments | | — | | — | | (.00)d | | — | | — | | (.00)d |
| Total Distributions | | (.15) | | (.35) | | (.44) | | (.52) | | (.55) | | (.54) |
| Net asset value, end of period | | 12.83 | | 12.93 | | 12.98 | | 12.91 | | 13.01 | | 12.81 |
| |
| |
| |
| |
| |
| |
|
| Total Return (%) | | .41e | | 2.31 | | 3.99 | | 3.24 | | 5.96 | | 2.10 |
| |
| |
| |
| |
| |
| |
|
| Ratios/Supplemental Data (%): | | | | | | | | | | |
| Ratio of total expenses | | | | | | | | | | | | |
| to average net assets | | .73f | | .75 | | .72 | | .69 | | .71 | | .73 |
| Ratio of net investment income | | | | | | | | | | | | |
| to average net assets | | 2.38f | | 2.68 | | 3.34 | | 3.98 | | 4.26 | | 4.15 |
| Portfolio Turnover Rate | | 20.00e | | 38.06 | | 77.91 | | 54.94 | | 37.77 | | 39.10 |
| |
| |
| |
| |
| |
| |
|
| Net Assets, end of period | | | | | | | | | | | | |
| ($ x 1,000) | | 255,340 | | 276,976 | | 321,379 | | 356,127 | | 280,379 | | 270,181 |
| a The fund commenced offering four classes of shares on March 12, 2003.The existing shares were redesignated |
| Class D shares and the fund added Class A, Class B and Class P. |
| b As required, effective April 1, 2001, the fund has adopted the provisions of the AICPA Audit and Accounting Guide |
| for Investment Companies and began amortizing discount or premium on a scientific basis for debt securities on a |
| daily basis.The effect of this change for the period ended March 31, 2002 was to increase net investment income per |
| share by $.01, and decrease net realized and unrealized gain (loss) on investments per share by $.01 and increase the |
| ratio of net investment income to average net assets from 3.96% to 3.98%. Per share data and ratios/supplemental |
| data for periods prior to April 1, 2001 have not been restated to reflect this change in presentation. |
| c Based on average shares outstanding at each month end. |
| d Amount represents less than $.01 per share. |
| e Not annualized. |
| f Annualized. |
See notes to financial statements.
22
| | | Six Months Ended | | | | |
| | | September 30, 2004 | | Year Ended March 31, |
| | | |
|
| Class P Shares | | (Unaudited) | | 2004 | | 2003 a |
| |
| |
| |
|
| Per Share Data ($): | | | | | | |
| Net asset value, beginning of period | | 12.94 | | 12.98 | | 13.06 |
| Investment Operations: | | | | | | |
| Investment income—net b | | .14 | | .32 | | .02 |
| Net realized and unrealized | | | | | | |
| gain (loss) on investments | | (.11) | | (.03) | | (.08) |
| Total from Investment Operations | | .03 | | .29 | | (.06) |
| Distributions: | | | | | | |
| Dividends from investment income—net | | (.14) | | (.33) | | (.02) |
| Net asset value, end of period | | 12.83 | | 12.94 | | 12.98 |
| |
| |
| |
|
| Total Return (%) | | .27c | | 2.24 | | (.45)c |
| |
| |
| |
|
| Ratios/Supplemental Data (%): | | | | | | |
| Ratio of total expenses to average net assets | | .87d | | .87 | | .94d |
| Ratio of net investment income | | | | | | |
| to average net assets | | 2.23d | | 2.41 | | 2.90d |
| Portfolio Turnover Rate | | 20.00c | | 38.06 | | 77.91 |
| |
| |
| |
|
| Net Assets, end of period ($ x 1,000) | | 3,807 | | 3,587 | | 1 |
| a | | From March 12, 2003 (commencement of initial offering) to March 31, 2003. |
| b | | Based on average shares outstanding at each month end. |
| c | | Not annualized. |
| d | | Annualized. |
See notes to financial statements.
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1—Significant Accounting Policies:
Dreyfus Premier Short-Intermediate Municipal Bond Fund (the “fund”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as a non-diversified open-end management investment company. The fund’s investment objective is to provide investors with as high a level of current income exempt from federal income tax as is consistent with the preservation of capital. The Dreyfus Corporation (the “Manager” or “Dreyfus”) serves as the fund’s investment adviser. The Manager is a wholly-owned subsidiary of Mellon Financial Corporation (“Mellon Financial”).
Dreyfus Service Corporation (the “Distributor”), a wholly-owned subsidiary of the Manager, is the distributor of the fund’s shares.The fund is authorized to issue an unlimited number of $.001 par value shares of Beneficial Interest in each of the following classes of shares: Class A, Class B, Class D and Class P. Class A shares are subject to a sales charge imposed at the time of purchase. Class B shares are subject to a contingent deferred sales charge (“CDSC”) imposed on Class B share redemptions made within six years of purchase and automatically convert to Class A shares after six years. Class P shares are sold at net asset value per share with a minimum initial investment of $100,000. Class D shares are sold at net asset value per share directly by Dreyfus and through certain banks and fund supermarkets, and as a part of certain wrap-fee programs. Class A shares purchased at net asset value (an investment of $250,000 or more) will have a CDSC imposed on redemptions made within eighteen months of purchase. Other differences between the classes include the services offered to and the expenses borne by each class and certain voting rights. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its relative net assets.
The fund’s financial statements are prepared in accordance with U.S. generally accepted accounting principles, which may require
24
the use of management estimates and assumptions. Actual results could differ from those estimates.
The fund enters into contracts that contain a variety of indemnifications. The fund’s maximum exposure under these arrangements is unknown.The fund does not anticipate recognizing any loss related to these arrangements.
(a) Portfolio valuation: Investments in securities are valued each business day by an independent pricing service (the “Service”) approved by the Board of Trustees. Investments for which quoted bid prices are readily available and are representative of the bid side of the market in the judgment of the Service are valued at the mean between the quoted bid prices (as obtained by the Service from dealers in such securities) and asked prices (as calculated by the Service based upon its evaluation of the market for such securities). Other investments (which constitute a majority of the portfolio securities) are carried at fair value as determined by the Service, based on methods which include consideration of: yields or prices of municipal securities of comparable quality, coupon, maturity and type; indications as to values from dealers; and general market conditions.
(b) Securities transactions and investment income: Securities transactions are recorded on a trade date basis. Realized gain and loss from securities transactions are recorded on the identified cost basis. Interest income, adjusted for amortization of discount and premium on invest-ments,is earned from settlement date and recognized on the accrual basis. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date.
The fund has an arrangement with the custodian bank whereby the fund receives earnings credits from the custodian when positive cash balances are maintained, which are used to offset custody fees. For financial reporting purposes, the fund includes net earnings credits as an expense offset in the Statement of Operations.
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
(c) Dividends to shareholders: It is the policy of the fund to declare dividends daily from investment income-net. Such dividends are paid monthly. Dividends from net realized capital gain, if any, are normally declared and paid annually, but the fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the “Code”).To the extent that net realized capital gain can be offset by capital loss carryovers, it is the policy of the fund not to distribute such gain.
(d) Federal income taxes: It is the policy of the fund to continue to qualify as a regulated investment company, which can distribute tax exempt dividends, by complying with the applicable provisions of the Code, and to make distributions of income and net realized capital gain sufficient to relieve it from substantially all federal income and excise taxes.
The fund has an unused capital loss carryover of $5,933,425 available for federal income tax purposes to be applied against future net securities profits, if any, realized subsequent to March 31, 2004. If not applied, $82,442 of the carryover expires in fiscal 2008, $304,210 expires in fiscal 2009, $5,502,769 expires in fiscal 2011 and $44,004 expires in fiscal 2012.
The tax character of distributions paid to shareholders during the fiscal year ended March 31, 2004 was as follows: tax exempt income $8,204,267. The tax character of current year distributions will be determined at the end of the current fiscal year.
NOTE 2—Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $350 million redemption credit facility (the “Facility”) to be utilized for temporary or emergency purposes, including the financing of redemptions. In connection therewith, the fund has agreed to pay commitment fees on its pro rata portion of the Facility. Interest is charged to the fund based on prevailing market rates in effect at the time of borrowings. During the period ended September 30, 2004, the fund did not borrow under the Facility.
26
| NOTE 3—Management Fee and Other Transactions With |
| Affiliates: |
(a) Pursuant to a management agreement (“Agreement”) with the Manager, the management fee is computed at the annual rate of .50 of 1% of the value of the fund’s average daily net assets and is payable monthly. The Agreement provides that if in any full fiscal year the aggregate expenses, exclusive of taxes, brokerage fees, interest on borrowings, commitment fees and extraordinary expenses, exceed with respect to Class D shares, 1 1 / 2% of the value of the fund’s average daily net assets, attributable to Class D shares, the fund may deduct from payments to be made to the Manager, or the Manager will bear such excess expense. During the period ended September 30, 2004, there was no expense reimbursement pursuant to the Agreement.
During the period ended September 30, 2004, the Distributor retained $1,056 earned from commissions on sales of the fund’s Class A shares and $6,119 and $2,209 from contingent deferred sales charges on redemptions on the fund’s Class B and Class C shares, respectively.
(b) Under the Distribution Plan (the “Plan”) adopted pursuant to Rule 12b-1 under the Act, Class B and Class D shares pay the Distributor for distributing their shares at an annual rate of .75 of 1% of the value of the average daily net assets of Class B shares and .10 of 1% of the value of the average daily net assets of Class D shares. During the period ended September 30, 2004, Class B and Class D shares were charged $7,317 and $131,415, respectively, pursuant to the Plan.
(c) Under the Shareholder Services Plan, Class A, Class B and Class P shares pay the distributor at an annual rate of .25 of 1% of the value of the average daily net assets of Class A, Class B and Class P shares, for the provision of certain services. The services provided may include personal services relating to shareholder accounts, such as answering shareholder inquiries regarding Class A, Class B and Class P shares and providing reports and other information, and services related to the maintenance of shareholder accounts.The Distributor may make payments to Service Agents (a securities dealer, financial institution or
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
other industry professional) in respect of these services. The Distributor determines the amounts to be paid to Service Agents. During the period ended September 30, 2004, Class A, Class B and Class P shares were charged $14,743, $2,439 and $4,842, respectively, pursuant to the Shareholder Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the Manager, under a transfer agency agreement for providing personnel and facilities to perform transfer agency services for the fund. During the period ended September 30, 2004, the fund was charged $37,885 pursuant to the transfer agency agreement.
The components of Due to The Dreyfus Corporation and affiliates in the Statement of Assets and Liabilities consist of: management fees $113,026, Rule 12b-1 distribution plan fees $22,456 and shareholder services plan fees $3,762.
(d) Each Board member also serves as a Board member of other funds within the Dreyfus complex. Annual retainer fees and attendance fees are allocated to each fund based on net assets.
NOTE 4—Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding short-term securities, during the period ended September 30, 2004, amounted to $54,968,010 and $74,764,127, respectively.
At September 30, 2004, accumulated net unrealized appreciation on investments was $2,517,005, consisting of $2,867,256 gross unrealized appreciation and $350,251 gross unrealized depreciation.
At September 30, 2004, the cost of investments for federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments).
NOTE 5—Legal Matters:
Two class actions have been filed against Mellon Financial, Mellon Bank, N.A., Dreyfus, Founders Asset Management LLC and the directors of all or substantially all of the Dreyfus funds, on behalf of a pur-
28
ported class and derivatively on behalf of said funds, alleging violations of the Investment Company Act of 1940, the Investment Advisers Act of 1940, and the common law. The complaints alleged, among other things, (i) that 12b-1 fees and directed brokerage were improperly used to pay brokers to recommend Dreyfus funds over other funds, (ii) that such payments were not disclosed to investors, (iii) that economies of scale and soft-dollar benefits were not passed on to investors and (iv) that 12b-1 fees charged to certain funds that were closed to new investors were also improper. The complaints sought compensatory and punitive damages, rescission of the advisory contracts and an accounting and restitution of any unlawful fees, as well as an award of attorneys’ fees and litigation expenses. On April 22, 2004, the actions were consolidated under the caption In re Dreyfus Mutual Funds Fee Litigation, and a consolidated amended complaint was filed on September 13, 2004.While adding new parties and claims under state and federal law, the allegations in the consolidated amended complaint essentially track the allegations in the prior complaints pertaining to 12b-1 fees, directed brokerage, soft dollars and revenue sharing. Dreyfus and the funds believe the allegations to be totally without merit and intend to defend the action vigorously.
Additional lawsuits arising out of these circumstances and presenting similar allegations and requests for relief may be filed against the defendants in the future. Neither Dreyfus nor the Dreyfus funds believe that any of the pending actions will have a material adverse effect on the Dreyfus funds or Dreyfus’ ability to perform its contracts with the Dreyfus funds.
| For More | | Information |
| |
|
| |
| Dreyfus Premier | | Transfer Agent & |
| Short-Intermediate | | Dividend Disbursing Agent |
| Municipal Bond Fund | | |
| | | Dreyfus Transfer, Inc. |
| 200 Park Avenue | | |
| | | 200 Park Avenue |
| New York, NY 10166 | | |
| | | New York, NY 10166 |
| |
| Manager | | Distributor |
| The Dreyfus Corporation | | |
| | | Dreyfus Service Corporation |
| 200 Park Avenue | | |
| | | 200 Park Avenue |
| New York, NY 10166 | | |
| | | New York, NY 10166 |
| Custodian | | |
| The Bank of New York | | |
| One Wall Street | | |
| New York, NY 10286 | | |
Telephone Call your financial representative or 1-800-554-4611
| Mail | | The Dreyfus Premier Family of Funds |
| | | 144 Glenn Curtiss Boulevard, Uniondale, NY 11556-0144 |
A description of the policies and procedures that the fund uses to determine how to vote proxies relating to portfolio securities, and information regarding how the fund voted these proxies for the 12-month period ended June 30, 2004, is available through the fund’s website at http://www.dreyfus.com and on the SEC’s website at http://www.sec.gov. The description of the policies and procedures is also available without charge, upon request, by calling 1-800-645-6561.
Beginning with the fund’s fiscal quarter ending December 31, 2004, the fund will file its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The fund’s Forms N-Q will be available on the SEC’s website at http://www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
© 2004 Dreyfus Service Corporation
| 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. |
| | | Not applicable. |
| Item 9. | | Submission of Matters to a Vote of Security Holders. |
| | | Not applicable. |
| Item 10. | | Controls and Procedures. |
(a) The Registrant's principal executive and principal financial officers have concluded, based on their evaluation of the Registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant's disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-CSR is accumulated and communicated to the Registrant's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
(b) There were no changes to the Registrant's internal control over financial reporting that occurred during the Registrant's most recently ended 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) | | not applicable |
| (a)(2) | | Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) |
| under the Investment Company Act of 1940. |
| (a)(3) | | Not applicable. |
| (b) | | Certification of principal executive and principal financial officers as required by Rule 30a-2(b) |
| under the Investment Company Act of 1940. |
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.
DREYFUS PREMIER SHORT INTERMEDIATE MUNICIPAL BOND FUND
| By: | | /s/ Stephen E. Canter |
| | | Stephen E. Canter |
| | | President |
| |
| Date: | | November 23, 2004 |
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.
| By: | | /s/ Stephen E. Canter |
| | | Stephen E. Canter |
| | | Chief Executive Officer |
| |
| Date: | | November 23, 2004 |
| |
| By: | | /s/ James Windels |
| James Windels |
| | | Chief Financial Officer |
| |
| Date: | | November 23, 2004 |
EXHIBIT INDEX
(a)(2) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940. (EX-99.CERT)
(b) Certification of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940. (EX-99.906CERT)
