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: | | 811-05206 |
Jennison Natural Resources Fund, Inc.
|
| Exact name of registrant as specified in charter: |
| | |
Gateway Center 3, 100 Mulberry Street, Newark, New Jersey 07102 |
| Address of principal executive offices: |
Deborah A. Docs
Gateway Center 3,
100 Mulberry Street,
Newark, New Jersey 07102
|
| Name and address of agent for service: |
Registrant’s telephone number, including area code: 800-225-1852
Date of fiscal year end: 5/31/2009
Date of reporting period: 11/30/2008
Item 1 – Reports to Stockholders –
| | |
| NOVEMBER 30, 2008 | | SEMIANNUAL REPORT |
Jennison Natural Resources Fund, Inc.
FUND TYPE
Sector stock
OBJECTIVE
Long-term growth of capital
This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The views expressed in this report and information about the Fund’s portfolio holdings are for the period covered by this report and are subject to change thereafter.
The accompanying financial statements as of November 30, 2008, were not audited and, accordingly, no auditor’s opinion is expressed on them.
JennisonDryden, Jennison, Prudential Financial and the Rock Prudential logo are registered service marks of The Prudential Insurance Company of America, Newark, NJ, and its affiliates.
January 15, 2009
Dear Shareholder:
On the following pages, you’ll find your Fund’s semiannual report, including a table showing fund performance over the first half of the fiscal year and for longer periods. The report also contains a listing of the Fund’s holdings at period-end. The semiannual report is an interim statement furnished between the Fund’s annual reports, which include an analysis of Fund performance over the fiscal year in addition to other data.
Mutual fund prices and returns will rise or fall over time, and asset managers tend to have periods when they perform better or worse than their long-term average. The best measures of a mutual fund’s quality are its return compared to that of similar investments and the variability of its return over the long term. We recommend that you review your portfolio regularly with your financial professional.
Thank you for choosing JennisonDryden Mutual Funds.
Sincerely,
Judy A. Rice, President
Jennison Natural Resources Fund, Inc.
| | |
| Jennison Natural Resources Fund, Inc. | | 1 |
Your Fund’s Performance
Fund objective
The investment objective of the Jennison Natural Resources Fund, Inc. is long-term growth of capital. There can be no assurance that the Fund will achieve its investment objective.
Performance data quoted represent past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at www.jennisondryden.com or by calling (800) 225-1852. The maximum initial sales charge is 5.50% (Class A shares). Gross operating expenses: Class A, 1.17%; Class B, 1.87%; Class C, 1.87%; Class R, 1.62%; Class Z, 0.87%. Net operating expenses: Class A, 1.15%; Class B, 1.85%; Class C, 1.85%; Class R, 1.35%; Class Z, 0.85%, after contractual reductions.1
| | | | | | | | | | | | | | |
| Cumulative Total Returns as of 11/30/08 |
| | | Six Months | | | One Year | | | Five Years | | | Ten Years | | | Since Inception2 |
Class A | | –59.36 | % | | –50.99 | % | | 74.28 | % | | 330.70 | % | | — |
Class B | | –59.49 | | | –51.32 | | | 67.99 | | | 299.92 | | | — |
Class C | | –59.49 | | | –51.32 | | | 67.99 | | | 299.92 | | | — |
Class R | | –59.37 | | | –51.07 | | | N/A | | | N/A | | | –29.46% (8/22/06) |
Class Z | | –59.28 | | | –50.83 | | | 76.54 | | | 341.67 | | | — |
Lipper Natural Resources Index3 | | –52.11 | | | –42.12 | | | 94.13 | | | 200.51 | | | *** |
MSCI World ND Index4 | | –40.89 | | | –43.30 | | | 0.38 | | | –4.70 | | | **** |
S&P 500 Index5 | | –35.18 | | | –38.08 | | | –6.78 | | | –8.96 | | | ***** |
Lipper Global Natural Resources Funds Avg.6 | | –54.74 | | | –47.71 | | | 65.22 | | | 224.56 | | | ****** |
| | |
| 2 | | Visit our website at www.jennisondryden.com |
| | | | | | | | | | | |
| Average Annual Total Returns7 as of 12/31/08 |
| | | One Year | | | Five Years | | | Ten Years | | | Since Inception2 |
Class A | | –55.46 | % | | 9.14 | % | | 15.64 | % | | — |
Class B | | –55.42 | | | 9.42 | | | 15.43 | | | — |
Class C | | –53.63 | | | 9.57 | | | 15.43 | | | — |
Class R | | –52.95 | | | N/A
|
| | N/A | | | –13.07% (8/22/06) |
Class Z | | –52.73 | | | 10.66 | | | 16.59 | | | — |
Lipper Natural Resources Index3 | | –49.00 | | | 10.16 | | | 11.10 | | | *** |
MSCI World ND Index4 | | –40.71 | | | –0.51 | | | –0.64 | | | **** |
S&P 500 Index5 | | –36.99 | | | –2.19 | | | –1.38 | | | ***** |
Lipper Global Natural Resources
Funds Avg.6 | | –50.58 | | | 7.57 | | | 12.22 | | | ****** |
The cumulative total returns do not reflect the deduction of applicable sales charges. If reflected, the applicable sales charges would reduce the cumulative total returns performance quoted. Class A shares are subject to a maximum front-end sales charge of 5.50%. Under certain circumstances, Class A shares may be subject to a contingent deferred sales charge (CDSC) of 1%. Class B and Class C shares are subject to a maximum CDSC of 5% and 1%, respectively. Class R and Class Z shares are not subject to a sales charge.
Source: Prudential Investments LLC and Lipper Inc. Performance figures may reflect fee waivers and/or expense reimbursements. In the absence of such fee waivers and/or expense reimbursements, total returns would be lower.
1For the period through September 30, 2009, the distributor of the Fund has contractually agreed to limit distribution and service (12b-1) fees to 0.50% of the average daily net assets for Class R shares. Through September 30, 2008 the manager of the Fund has contractually agreed to waive 0.05% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive 0.05% of the management fee rate on average daily net assets over $4 billion.
2Inception date returns are provided for any share class with less than 10 calendar years of returns.
3The Lipper Natural Resources Index is an unmanaged index which tracks the performance of the 30 largest natural resources mutual funds.
4The Morgan Stanley Capital International (MSCI) World Net Dividends (ND) Index is a free float-adjusted, market-capitalization index that is designed to measure global developed market equity performance. The MSCI World ND Index consists of approximately 23 developed market indexes in Australia, Canada, Europe, the Far East, New Zealand, and the United States.
5The Standard & Poor’s 500 Composite Stock Price Index (S&P 500 Index) is an unmanaged index of 500 stocks of large U.S. public companies. It gives a broad look at how stock prices have performed in the United States.
6The Lipper Global Natural Resources Funds Average (Lipper Average) is based on the average return of all mutual funds in the Lipper Natural Resources Fund category and does not include the effect of any sales charges or taxes payable by investors.
7The average annual total returns take into account applicable sales charges. Class A, Class B, Class C, and Class R shares are subject to an annual distribution and service (12b-1) fee of up to 0.30%, 1.00%, 1.00%, and
| | |
| Jennison Natural Resources Fund, Inc. | | 3 |
Your Fund’s Performance (continued)
0.75%, respectively. Approximately seven years after purchase, Class B shares will automatically convert to Class A shares on a quarterly basis. Class Z shares are not subject to a 12b-1 fee. The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares.
***Lipper Natural Resources Index Closest Month-End to Inception cumulative total return as of 11/30/08 is –20.00% for Class R. Lipper Natural Resources Index Closest Month-End to Inception average annual total return as of 12/31/08 is –11.75% for Class R.
****MSCI World ND Index Closest Month-End to Inception cumulative total return as of 11/30/08 is –31.31% for Class R. MSCI World ND Index Closest Month-End to Inception average annual total return as of 12/31/08 is –13.71% for Class R.
*****S&P 500 Index Closest Month-End to Inception cumulative total return as of 11/30/08 is –28.01% for Class R. S&P 500 Index Closest Month-End to Inception average annual total return as of 12/31/08 is –12.75% for Class R.
******Lipper Average Closest Month-End to Inception cumulative total return as of 11/30/08 is –28.03% for Class R. Lipper Average Closest Month-End to Inception average annual total return as of 12/31/08 is –14.49% for Class R.
Investors cannot invest directly in an index. The returns for the MSCI World ND Index and S&P 500 Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes that may be paid by an investor. Returns for the Lipper Average reflect the deduction of operating expenses, but not sales charges or taxes. Returns for the Lipper Average would be lower if it included the effects of sales charges or taxes.
| | | |
| Five Largest Holdings expressed as a percentage of net assets as of 11/30/08 | | | |
Southwestern Energy Co., Oil & Gas Exploration & Production | | 3.7 | % |
Range Resources Corp., Oil & Gas Exploration & Production | | 2.6 | |
Devon Energy Corp., Oil & Gas Exploration & Production | | 2.5 | |
EOG Resources, Inc., Oil & Gas Exploration & Production | | 2.4 | |
XTO Energy, Inc., Oil & Gas Exploration & Production | | 2.4 | |
Holdings reflect only long-term investments and are subject to change.
| | | |
| Five Largest Industries expressed as a percentage of net assets as of 11/30/08 | | | |
Oil & Gas Exploration & Production | | 37.5 | % |
Gold | | 16.0 | |
Oil & Gas Equipment & Services | | 11.7 | |
Integrated Oil & Gas | | 11.2 | |
Diversified Metals & Mining | | 5.0 | |
Industry weightings reflect only long-term investments and are subject to change.
| | |
| 4 | | Visit our website at www.jennisondryden.com |
Fees and Expenses (Unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses, as applicable. 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 on June 1, 2008, at the beginning of the period, and held through the six-month period ended November 30, 2008. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of JennisonDryden funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, 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 ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on
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| Jennison Natural Resources Fund, Inc. | | 5 |
Fees and Expenses (continued)
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). Therefore, the second line for each share class in 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.
| | | | | | | | | | | | | | |
Jennison Natural Resources Fund, Inc. | | Beginning Account
Value
June 1, 2008 | | Ending Account
Value
November 30, 2008 | | Annualized
Expense Ratio
Based on the
Six-Month Period | | | Expenses Paid
During the
Six-Month Period* |
| | | | | | | | | | | | | | |
| Class A | | Actual | | $ | 1,000.00 | | $ | 406.40 | | 1.15 | % | | $ | 4.05 |
| | | Hypothetical | | $ | 1,000.00 | | $ | 1,019.30 | | 1.15 | % | | $ | 5.82 |
| | | | | | | | | | | | | | |
| Class B | | Actual | | $ | 1,000.00 | | $ | 405.10 | | 1.85 | % | | $ | 6.52 |
| | | Hypothetical | | $ | 1,000.00 | | $ | 1,015.79 | | 1.85 | % | | $ | 9.35 |
| | | | | | | | | | | | | | |
| Class C | | Actual | | $ | 1,000.00 | | $ | 405.10 | | 1.85 | % | | $ | 6.52 |
| | | Hypothetical | | $ | 1,000.00 | | $ | 1,015.79 | | 1.85 | % | | $ | 9.35 |
| | | | | | | | | | | | | | |
| Class R | | Actual | | $ | 1,000.00 | | $ | 406.30 | | 1.35 | % | | $ | 4.76 |
| | | Hypothetical | | $ | 1,000.00 | | $ | 1,018.30 | | 1.35 | % | | $ | 6.83 |
| | | | | | | | | | | | | | |
| Class Z | | Actual | | $ | 1,000.00 | | $ | 407.20 | | 0.85 | % | | $ | 3.00 |
| | | Hypothetical | | $ | 1,000.00 | | $ | 1,020.81 | | 0.85 | % | | $ | 4.31 |
| | | | | | | | | | | | | | |
* Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 183 days in the six-month period ended November 30, 2008, and divided by the 365 days in the Fund’s fiscal year ending May 31, 2009 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
| | |
| 6 | | Visit our website at www.jennisondryden.com |
Portfolio of Investments
as of November 30, 2008 (Unaudited)
| | | | | |
| Shares | | Description | | Value (Note 1) |
| | | | | |
LONG-TERM INVESTMENTS 99.2% | | | |
COMMON STOCKS 98.4% | | | |
| |
Agricultural Products | | | |
| 2,183,300 | | Agrenco Ltd. 144A (Brazil)(a)(g) | | $ | 197,972 |
| |
Aluminum 0.7% | | | |
| 1,403,100 | | Century Aluminum Co.(a)(b) | | | 11,435,265 |
| |
Coal & Consumable Fuels 1.8% | | | |
| 933,600 | | Cameco Corp. (Canada) | | | 16,674,117 |
| 1,265,100 | | Patriot Coal Corp.(a)(b) | | | 10,715,397 |
| | | | | |
| | | | | 27,389,514 |
| |
Diversified Metals & Mining 5.0% | | | |
| 1,236,900 | | African Rainbow Minerals Ltd. (South Africa) | | | 12,514,001 |
| 12,700 | | Anglo American PLC (United Kingdom) | | | 302,350 |
| 48,300 | | Antofagasta PLC (United Kingdom) | | | 322,993 |
| 6,500 | | BHP Billiton Ltd. (Australia)(ADR) | | | 260,130 |
| 583,900 | | First Quantum Minerals Ltd. (Canada) | | | 8,615,844 |
| 1,267,700 | | First Uranium Corp. (South Africa)(a) | | | 1,799,026 |
| 600,000 | | First Uranium Corp. 144A (South Africa)(a)(e)(g) | | | 851,476 |
| 698,900 | | FNX Mining Co., Inc. (Canada)(a) | | | 1,820,228 |
| 14,200 | | FNX Mining Co., Inc. 144A (Canada)(a)(g) | | | 36,983 |
| 825,899 | | Freeport-McMoRan Copper & Gold, Inc.(b) | | | 19,813,317 |
| 1,398,700 | | Northern Dynasty Minerals Ltd.(a)(b) | | | 3,916,360 |
| 17,000 | | Rio Tinto PLC (United Kingdom) | | | 422,844 |
| 93,500 | | Rio Tinto PLC (United Kingdom)(ADR)(b) | | | 9,350,000 |
| 482,200 | | Southern Copper Corp.(b) | | | 6,635,072 |
| 2,127,900 | | Sterlite Industries Ltd. (India)(ADR)(b) | | | 10,490,547 |
| 26,200 | | Vedanta Resources PLC (United Kingdom) | | | 247,572 |
| 16,600 | | Xstrata PLC (Switzerland) | | | 239,288 |
| | | | | |
| | | | | 77,638,031 |
| |
Gas Utilities 1.3% | | | |
| 604,400 | | Equitable Resources, Inc. | | | 20,168,828 |
| |
Gold 16.0% | | | |
| 573,800 | | Agnico-Eagle Mines Ltd.(b) | | | 21,609,308 |
| 8,000,000 | | Archipelago Resources PLC (United Kingdom)(a) | | | 503,214 |
| 6,303,400 | | AXMIN, Inc. (Canada)(a) | | | 304,954 |
| 792,446 | | Barrick Gold Corp. | | | 23,345,459 |
| 982,800 | | Centerra Gold, Inc. (Canada)(a) | | | 1,996,981 |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 7 |
Portfolio of Investments
as of November 30, 2008 (Unaudited) continued
| | | | | |
| Shares | | Description | | Value (Note 1) |
| | | | | |
COMMON STOCKS (Continued) | | | |
| |
Gold (cont’d.) | | | |
| 5,216,900 | | Eldorado Gold Corp. (Canada)(a) | | $ | 31,506,677 |
| 4,519,100 | | European Goldfields Ltd. (Canada)(a) | | | 8,125,781 |
| 2,837,400 | | Gabriel Resources Ltd. (Canada)(a) | | | 3,363,149 |
| 993,800 | | Gold Reserve, Inc.(a) | | | 327,954 |
| 216,800 | | Gold Reserve, Inc.(a) | | | 87,405 |
| 1,184,436 | | Goldcorp, Inc.(b) | | | 31,944,239 |
| 792,400 | | Highland Gold Mining Ltd. (United Kingdom)(a) | | | 681,461 |
| 2,468,500 | | Kinross Gold Corp.(b) | | | 36,410,375 |
| 1,065,800 | | Lihir Gold Ltd. (Papua New Guinea)(ADR)(a)(b) | | | 16,168,186 |
| 3,817,384 | | Lihir Gold Ltd. 144A (Papua New Guinea)(a)(g) | | | 5,510,213 |
| 4,052,100 | | Nevsun Resources Ltd. (Canada)(a) | | | 2,091,069 |
| 1,004,167 | | Newcrest Mining Ltd. (Australia) | | | 16,078,993 |
| 439,890 | | Newcrest Mining Ltd. 144A (Australia)(g) | | | 7,043,638 |
| 849,100 | | Newmont Mining Corp. | | | 28,572,215 |
| 2,250,600 | | Orezone Resources, Inc. (Canada)(a) | | | 308,500 |
| 272,900 | | Seabridge Gold, Inc.(a)(b) | | | 3,029,190 |
| 3,312,300 | | Semafo, Inc. (Canada)(a) | | | 3,071,396 |
| 4,783,700 | | Semafo, Inc. 144A (Canada)(a)(e)(g) | | | 4,435,780 |
| 40,200 | | Yamana Gold, Inc. | | | 233,562 |
| | | | | |
| | | | | 246,749,699 |
| |
Independent Power Producers & Energy Traders 1.7% | | | |
| 631,700 | | EDP Renovaveis SA 144A (Spain)(a)(g) | | | 3,950,450 |
| 972,100 | | NRG Energy, Inc.(a)(b) | | | 23,029,049 |
| | | | | |
| | | | | 26,979,499 |
| |
Integrated Oil & Gas 11.2% | | | |
| 2,293,300 | | BG Group PLC (United Kingdom) | | | 32,728,592 |
| 5,700 | | BP PLC (United Kingdom)(ADR) | | | 277,533 |
| 3,400 | | Exxon Mobil Corp. | | | 272,510 |
| 460,000 | | Hess Corp. | | | 24,858,400 |
| 662,800 | | Occidental Petroleum Corp.(b) | | | 35,883,992 |
| 875,200 | | Petroleo Brasileiro SA (Brazil)(ADR) | | | 18,326,688 |
| 10,200 | | Royal Dutch Shell PLC (Netherlands) | | | 271,868 |
| 1,093,500 | | Sasol Ltd. (South Africa)(ADR)(b) | | | 31,230,360 |
| 1,382,800 | | Suncor Energy, Inc.(b) | | | 29,647,232 |
| 3,200 | | Total S.A. (France)(ADR) | | | 168,800 |
| | | | | |
| | | | | 173,665,975 |
See Notes to Financial Statements.
| | |
| 8 | | Visit our website at www.jennisondryden.com |
| | | | | |
| Shares | | Description | | Value (Note 1) |
| | | | | |
COMMON STOCKS (Continued) | | | |
| |
Marine Ports & Services 0.1% | | | |
| 3,134,000 | | LLX Logistica SA (Brazil)(a) | | $ | 1,569,740 |
| |
Oil & Gas Drilling 3.4% | | | |
| 567,200 | | Helmerich & Payne, Inc. | | | 14,384,192 |
| 650,700 | | Noble Corp. | | | 17,432,253 |
| 248,756 | | Transocean, Inc.(a)(b) | | | 16,636,801 |
| 3,222,300 | | Vantage Drilling Co.(a)(b) | | | 3,383,415 |
| | | | | |
| | | | | 51,836,661 |
| |
Oil & Gas Equipment & Services 11.7% | | | |
| 1,278,600 | | Cameron International Corp.(a)(b) | | | 26,978,460 |
| 1,219,000 | | Complete Production Services(a) | | | 9,983,610 |
| 621,000 | | Dril-Quip, Inc.(a) | | | 12,221,280 |
| 479,700 | | Exterran Holdings, Inc.(a)(b) | | | 8,418,735 |
| 14,200 | | FMC Technologies, Inc.(a)(b) | | | 390,074 |
| 1,246,000 | | Halliburton Co.(b) | | | 21,929,600 |
| 1,056,700 | | National Oilwell Varco, Inc.(a) | | | 29,894,043 |
| 671,100 | | Schlumberger, Ltd. | | | 34,051,614 |
| 841,700 | | Superior Energy Services, Inc.(a) | | | 14,182,645 |
| 1,105,300 | | Tenaris SA (Luxembourg)(ADR)(b) | | | 23,244,459 |
| | | | | |
| | | | | 181,294,520 |
| |
Oil & Gas Exploration & Production 36.7% | | | |
| 708,500 | | Bill Barrett Corp.(a)(b) | | | 15,849,145 |
| 3,600,000 | | BPI Energy Holdings, Inc.(a)(e) | | | 270,000 |
| 779,200 | | Cabot Oil & Gas Corp. | | | 23,352,624 |
| 838,800 | | Cairn Energy PLC (United Kingdom)(a) | | | 21,924,492 |
| 962,200 | | Concho Resources, Inc.(a)(b) | | | 22,698,298 |
| 1,917,700 | | Denbury Resources, Inc.(a) | | | 18,275,681 |
| 537,600 | | Devon Energy Corp. | | | 38,889,984 |
| 444,600 | | EOG Resources, Inc. | | | 37,799,892 |
| 3,037,450 | | Integra Group Holdings(a) | | | 2,733,705 |
| 6,430,000 | | Linc Energy Ltd. 144A (Australia)(a)(e)(g) | | | 10,942,659 |
| 711,300 | | Newfield Exploration Co.(a) | | | 16,061,154 |
| 604,500 | | Nexen, Inc.(b) | | | 11,691,030 |
| 545,600 | | Noble Energy, Inc. | | | 28,523,968 |
| 116,889 | | OGX Petroleo E Gas Participacoes SA (Brazil)(a) | | | 20,188,519 |
| 4,206,812 | | Oil Search Ltd. (Papua New Guinea) | | | 13,697,931 |
| 3,041,436 | | OPTI Canada, Inc. (Canada)(a) | | | 5,346,178 |
| 3,797,100 | | Pacific Rubiales Energy Corp. (Canada)(a) | | | 9,950,472 |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 9 |
Portfolio of Investments
as of November 30, 2008 (Unaudited) continued
| | | | | |
| Shares | | Description | | Value (Note 1) |
| | | | | |
COMMON STOCKS (Continued) | | | |
| |
Oil & Gas Exploration & Production (cont’d.) | | | |
| 1,074,600 | | Petrohawk Energy Corp.(a)(b) | | $ | 18,773,262 |
| 618,900 | | Pioneer Natural Resources Co.(b) | | | 12,427,512 |
| 958,050 | | Range Resources Corp.(b) | | | 39,730,334 |
| 1,430,900 | | SandRidge Energy, Inc.(a) | | | 12,677,774 |
| 1,686,000 | | Southwestern Energy Co.(a) | | | 57,947,820 |
| 319,800 | | St. Mary Land & Exploration Co. | | | 6,431,178 |
| 2,482,200 | | Talisman Energy, Inc. | | | 22,985,172 |
| 551,694 | | Trident Resources Corp. (Canada) (Private)
(cost $17,670,540; purchased 12/4/03 - 1/5/06)(a)(e)(f) | | | 4,448,428 |
| 661,900 | | Ultra Petroleum Corp.(a) | | | 26,892,997 |
| 4,810,000 | | UTS Energy Corp. (Canada)(a) | | | 3,257,862 |
| 905,097 | | Woodside Petroleum Ltd. (Australia) | | | 21,530,236 |
| 980,150 | | XTO Energy, Inc.(b) | | | 37,480,936 |
| 13,500,000 | | Zodiac Exploration Corp. (Canada) (Private)
(cost $6,324,074; purchased 8/8/08)(a)(e)(f) | | | 5,442,671 |
| | | | | |
| | | | | 568,221,914 |
| |
Oil & Gas Refining & Marketing 0.9% | | | |
| 304,100 | | Reliance Industries Ltd. 144A (India)(GDR)(e)(g) | | | 13,776,034 |
| |
Oil & Gas Storage & Transportation 1.5% | | | |
| 1,438,400 | | Williams Cos., Inc. | | | 23,330,848 |
| |
Packaged Food 0.5% | | | |
| 2,719,400 | | Cosan Ltd. (Class A)(a) | | | 8,348,558 |
| |
Precious Metals & Minerals 4.6% | | | |
| 1,537,000 | | Cia de Minas Buenaventura SA (Peru)(ADR) | | | 27,666,000 |
| 791,400 | | Greystar Resources Ltd. (Canada)(a) | | | 657,267 |
| 3,092,700 | | Hecla Mining Co.(a)(b) | | | 7,175,064 |
| 94,800 | | Impala Platinum Holdings Ltd. (South Africa) | | | 1,181,328 |
| 950,400 | | Impala Platinum Holdings Ltd. (South Africa)(ADR)(b) | | | 11,537,856 |
| 9,600 | | Lonmin PLC (United Kingdom) | | | 126,165 |
| 1,149,600 | | Pan American Silver Corp.(a) | | | 16,278,336 |
| 95,067 | | Pan American Silver Corp. (Canada)(a) | | | 1,425,775 |
| 523,100 | | Platmin Ltd. 144A (South Africa) Ltd.(a)(e)(g) | | | 244,636 |
| 1,445,300 | | Silver Wheaton Corp.(a)(b) | | | 4,986,285 |
| | | | | |
| | | | | 71,278,712 |
See Notes to Financial Statements.
| | |
| 10 | | Visit our website at www.jennisondryden.com |
| | | | | | |
| Shares | | Description | | Value (Note 1) | |
| | | | | | |
COMMON STOCKS (Continued) | | | | |
| |
Steel 1.3% | | | | |
| 3,000 | | ArcelorMittal NY Registered | | $ | 71,040 | |
| 656,900 | | Cliffs Natural Resources, Inc. | | | 15,601,375 | |
| 3,134,000 | | MMX Mineracao E Metalicos SA (Brazil)(a) | | | 4,411,511 | |
| 7,900 | | Nucor Corp. | | | 281,872 | |
| | | | | | |
| | | | | 20,365,798 | |
| | | | | | |
| | Total common stocks
(cost $2,198,843,040) | | | 1,524,247,568 | |
| | | | | | |
PREFERRED STOCK 0.1% | | | | |
| |
Oil & Gas Exploration & Production 0.1% | | | | |
| 80,000 | | Trident Resources Corp. (Canada) (Class B) (Private)
7.00% expiring 3/10/13 @ $12.50
(cost $5,000,000; purchased 7/7/06)(a)(e)(f) | | | 1,000,000 | |
| | | | | | |
| |
Principal
Amount (000) | | | |
CORPORATE BOND 0.7% | | | | |
| |
Oil & Gas Exploration & Production 0.7% | | | | |
| CAD 30,186 | | Trident Subordinated Unsecured Note (Canada) (Private) (PIK),
8.9363%, due 8/12/12
(cost $28,712,790; purchased 8/20/07)(e)(f) | | | 11,326,631 | |
| | | | | | |
| |
Units | | | |
WARRANTS(a) | | | | |
| |
Gold | | | | |
| 903,650 | | Crystallex International Corp. (Canada) (Private) expiring 8/11/09
(cost $0; purchased 2/8/08)(e)(f) | | | 3 | |
| | | | | | |
| |
Oil & Gas Exploration & Production | | | | |
| 2,591,932 | | Trident Resources Corp. (Canada) (Private) expiring 1/1/15
(cost $0; purchased 8/20/07)(e)(f) | | | 209 | |
| 13,500,000 | | Zodiac Exploration Corp. (Canada) (Private) expiring 2/10/12
(cost $0; purchased 8/8/08)(e)(f) | | | — | (h) |
| | | | | | |
| | Total warrants
(cost $0) | | | 212 | |
| | | | | | |
| | Total long-term investments
(cost $2,232,555,830) | | | 1,536,574,411 | |
| | | | | | |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 11 |
Portfolio of Investments
as of November 30, 2008 (Unaudited) continued
| | | | | | |
| Shares | | Description | | Value (Note 1) | |
SHORT-TERM INVESTMENT 20.2% | | | | |
| |
Affiliated Money Market Mutual Fund 20.2% | | | | |
| 312,708,319 | | Dryden Core Investment Fund - Taxable Money Market Series
(cost $312,708,319; includes $312,708,318 of cash collateral received for securities on loan) (Note 3)(c)(d) | | $ | 312,708,319 | |
| | | | | | |
| | Total Investments(i) 119.4%
(cost $2,545,264,149; Note 5) | | | 1,849,282,730 | |
| | Liabilities in excess of other assets (19.4%) | | | (300,485,912 | ) |
| | | | | | |
| | Net Assets 100.0% | | $ | 1,548,796,818 | |
| | | | | | |
The following abbreviations are used in portfolio descriptions:
ADR—American Depositary Receipt.
CAD—Canadian Dollar.
GDR—Global Depositary Receipt.
PIK—Payment in Kind.
| (a) | Non-income producing security. |
| (b) | All or a portion of security is on loan. The aggregate market value of such securities is $298,724,048; cash collateral of $312,708,318 (included in liabilities) was received with which the Fund purchased highly liquid short-term investments. |
| (c) | Prudential Investments LLC, the manager of the Fund, also serves as manager of the Dryden Core Investment Fund-Taxable Money Market Series. |
| (d) | Represents security, or a portion thereof, purchased with cash collateral received for securities on loan. |
| (e) | Indicates a security that has been deemed illiquid. |
| (f) | Indicates securities restricted to resale. The aggregate cost of such securities was $57,707,404. The aggregate value of $22,217,942 is approximately 1.4% of net assets. |
| (g) | Securities were purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, 144A securities are deemed to be liquid. |
| (i) | As of November 30, 2008, 27 securities representing $172,205,016 and 11.1% of the net assets were fair valued in accordance with the policies adopted by the Board of Directors. Of this amount $149,717,074 were valued using Other Significant Observable Inputs (Level 2, as defined below) and $22,487,942 were valued using Significant Unobservable Inputs (Level 3, as defined below). |
Various inputs are used in determining the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below.
Level 1—quoted prices in active markets for identical securities
Level 2—other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3—significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
See Notes to Financial Statements.
| | |
| 12 | | Visit our website at www.jennisondryden.com |
The following is a summary of the inputs used as of November 30, 2008 in valuing the Fund’s assets carried at fair value:
| | | | | |
Valuation inputs | | Investments
in Securities | | Other Financial
Instruments* |
Level 1—Quoted Prices | | $ | 1,677,077,714 | | — |
Level 2—Other Significant Observable Inputs | | | 149,717,074 | | — |
Level 3—Significant Unobservable Inputs | | | 22,487,942 | | — |
| | | | | |
Total | | $ | 1,849,282,730 | | — |
| | | | | |
| * | Other financial instruments are derivative instruments not reflected in the Portfolio of Investments, such as futures, forwards and swap contracts, which are valued at the unrealized appreciation/depreciation on the instrument. |
The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value:
| | | | |
| | | Investments
in Securities | |
Balance as of 5/31/08 | | $ | 62,545,229 | |
Realized gain (loss) | | | 10,564 | |
Change in unrealized appreciation (depreciation) | | | (20,334,447 | ) |
Net purchases (sales) | | | 7,384,378 | |
Transfers in and/or out of Level 3 | | | (27,117,782 | ) |
| | | | |
Balance as of 11/30/08 | | $ | 22,487,942 | |
| | | | |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 13 |
Portfolio of Investments
as of November 30, 2008 (Unaudited) continued
The geographic concentration of portfolio holdings and liabilities in excess of other assets shown as a percentage of net assets as of November 30, 2008 were as follows:
| | | |
United States (including 20.2% of collateral received for securities on loan) | | 89.2 | % |
Canada | | 8.1 | |
United Kingdom | | 4.3 | |
South Africa | | 3.8 | |
Australia | | 3.6 | |
Brazil | | 2.9 | |
Papua New Guinea | | 2.3 | |
Peru | | 1.8 | |
India | | 1.6 | |
Luxembourg | | 1.5 | |
Spain | | 0.3 | |
Netherlands | | — | (a) |
Switzerland | | — | (a) |
France | | — | (a) |
| | | |
| | 119.4 | |
Liabilities in excess of other assets | | (19.4 | ) |
| | | |
| | 100.0 | % |
| | | |
See Notes to Financial Statements.
| | |
| 14 | | Visit our website at www.jennisondryden.com |
Financial Statements
(Unaudited)
| | |
| NOVEMBER 30, 2008 | | SEMIANNUAL REPORT |
Jennison Natural Resources Fund, Inc.
Statement of Assets and Liabilities
as of November 30, 2008 (Unaudited)
| | | | |
Assets | | | | |
Investments, at value, including securities on loan of $298,724,048: | | | | |
Unaffiliated Investments (cost $2,232,555,830) | | $ | 1,536,574,411 | |
Affiliated Investments (cost $312,708,319) | | | 312,708,319 | |
Cash | | | 96,915 | |
Foreign currency, at value (cost $204,171) | | | 204,171 | |
Receivable for investments sold | | | 20,174,968 | |
Receivable for Fund shares sold | | | 3,968,342 | |
Dividends and interest receivable | | | 2,213,646 | |
Prepaid expenses | | | 76,309 | |
Foreign tax reclaim receivable | | | 38,666 | |
| | | | |
Total assets | | | 1,876,055,747 | |
| | | | |
| |
Liabilities | | | | |
Payable to broker for collateral for securities on loan (Note 4) | | | 312,708,318 | |
Payable for Fund shares reacquired | | | 6,423,265 | |
Loan payable (Note 7) | | | 5,890,000 | |
Management fee payable | | | 903,616 | |
Distribution fee payable | | | 578,636 | |
Accrued expenses | | | 404,251 | |
Transfer agent fee payable | | | 349,111 | |
Deferred directors’ fees | | | 1,732 | |
| | | | |
Total liabilities | | | 327,258,929 | |
| | | | |
| |
Net Assets | | $ | 1,548,796,818 | |
| | | | |
| | | | | |
Net assets were comprised of: | | | | |
Common stock, at par | | $ | 585,779 | |
Paid-in capital in excess of par | | | 2,456,210,304 | |
| | | | |
| | | 2,456,796,083 | |
Distributions in excess of net investment income | | | (109,873,157 | ) |
Accumulated net realized loss on investment and foreign currency transactions | | | (102,132,079 | ) |
Net unrealized depreciation on investments and foreign currencies | | | (695,994,029 | ) |
| | | | |
Net assets November 30, 2008 | | $ | 1,548,796,818 | |
| | | | |
See Notes to Financial Statements.
| | |
| 16 | | Visit our website at www.jennisondryden.com |
| | | |
Class A | | | |
Net asset value and redemption price per share
($762,582,389 ÷ 27,467,873 shares of common stock issued and outstanding) | | $ | 27.76 |
Maximum sales charge (5.50% of offering price) | | | 1.62 |
| | | |
Maximum offering price to public | | $ | 29.38 |
| | | |
| |
Class B | | | |
Net asset value, offering price and redemption price per share
($152,924,626 ÷ 6,441,661 shares of common stock issued and outstanding) | | $ | 23.74 |
| | | |
| |
Class C | | | |
Net asset value, offering price and redemption price per share
($344,985,863 ÷ 14,529,708 shares of common stock issued and outstanding) | | $ | 23.74 |
| | | |
| |
Class R | | | |
Net asset value, offering price and redemption price per share
($8,797,699 ÷ 317,100 shares of common stock issued and outstanding) | | $ | 27.74 |
| | | |
| |
Class Z | | | |
Net asset value, offering price and redemption price per share
($279,506,241 ÷ 9,821,600 shares of common stock issued and outstanding) | | $ | 28.46 |
| | | |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 17 |
Statement of Operations
Six Months Ended November 30, 2008 (Unaudited)
| | | | |
Net Investment Loss | | | | |
Income | | | | |
Unaffiliated dividends (net of foreign withholding taxes of $276,355) | | $ | 12,363,136 | |
Affiliated dividend income | | | 1,063,135 | |
Affliated income from securities loaned, net | | | 1,716,456 | |
Interest | | | 1,415,655 | |
| | | | |
Total income | | | 16,558,382 | |
| | | | |
| |
Expenses | | | | |
Management fee | | | 10,586,592 | |
Distribution fee—Class A | | | 2,219,117 | |
Distribution fee—Class B | | | 1,493,251 | |
Distribution fee—Class C | | | 3,449,047 | |
Distribution fee—Class R | | | 33,222 | |
Transfer agent’s fee and expenses (including affiliated expense of $643,400) (Note 3) | | | 1,608,000 | |
Custodian’s fees and expenses | | | 303,000 | |
Reports to shareholders | | | 167,000 | |
Registration fees | | | 129,000 | |
Interest expense (Note 7) | | | 45,972 | |
Directors’ fees | | | 43,000 | |
Legal fees and expenses | | | 40,000 | |
Loan interest expense (Note 7) | | | 18,456 | |
Audit fee | | | 11,000 | |
Insurance | | | 9,000 | |
Miscellaneous | | | 13,678 | |
| | | | |
Total expenses | | | 20,169,335 | |
| | | | |
Net investment loss | | | (3,610,953 | ) |
| | | | |
| |
Realized And Unrealized Loss On Investment And Foreign Currency Transactions | | | | |
Net realized gain (loss) on: | | | | |
Investment transactions | | | (166,913,917 | ) |
Foreign currency transactions | | | (2,212,560 | ) |
| | | | |
| | | (169,126,477 | ) |
| | | | |
Net change in unrealized appreciation (depreciation) on: | | | | |
Investments | | | (2,346,252,923 | ) |
Foreign currencies | | | (12,622 | ) |
| | | | |
| | | (2,346,265,545 | ) |
| | | | |
Net loss on investment and foreign currency transactions | | | (2,515,392,022 | ) |
| | | | |
Net Decrease In Net Assets Resulting From Operations | | $ | (2,519,002,975 | ) |
| | | | |
See Notes to Financial Statements.
| | |
| 18 | | Visit our website at www.jennisondryden.com |
Statement of Changes in Net Assets
(Unaudited)
| | | | | | | | |
| | | Six Months
Ended
November 30, 2008 | | | Year
Ended
May 31, 2008 | |
Increase (Decrease) In Net Assets | | | | | | | | |
Operations | | | | | | | | |
Net investment loss | | $ | (3,610,953 | ) | | $ | (12,177,444 | ) |
Net realized gain (loss) on investment and foreign currency transactions | | | (169,126,477 | ) | | | 150,914,709 | |
Net change in unrealized appreciation (depreciation) on investments and foreign currencies | | | (2,346,265,545 | ) | | | 884,458,138 | |
| | | | | | | | |
Net increase (decrease) in net assets resulting from operations | | | (2,519,002,975 | ) | | | 1,023,195,403 | |
| | | | | | | | |
| | |
Dividends and Distributions (Note 1) | | | | | | | | |
Dividends from net investment income | | | | | | | | |
Class A | | | — | | | | (57,445,684 | ) |
Class B | | | — | | | | (14,286,691 | ) |
Class C | | | — | | | | (28,309,937 | ) |
Class R | | | — | | | | (217,772 | ) |
Class Z | | | — | | | | (19,616,981 | ) |
| | | | | | | | |
| | | — | | | | (119,877,065 | ) |
| | | | | | | | |
Distributions from net realized gains | | | | | | | | |
Class A | | | — | | | | (62,490,439 | ) |
Class B | | | — | | | | (17,848,604 | ) |
Class C | | | — | | | | (35,367,012 | ) |
Class R | | | — | | | | (239,287 | ) |
Class Z | | | — | | | | (20,313,414 | ) |
| | | | | | | | |
| | | — | | | | (136,258,756 | ) |
| | | | | | | | |
| | |
Fund share transactions (Net of share conversions) (Note 6) | | | | | | | | |
Net proceeds from shares sold | | | 691,421,516 | | | | 1,669,733,304 | |
Net asset value of shares issued in reinvestment of dividends and distributions | | | — | | | | 208,778,584 | |
Cost of shares reacquired | | | (871,164,343 | ) | | | (722,832,041 | ) |
| | | | | | | | |
Net increase (decrease) in net assets from Fund share transactions | | | (179,742,827 | ) | | | 1,155,679,847 | |
| | | | | | | | |
Total increase (decrease) | | | (2,698,745,802 | ) | | | 1,922,739,429 | |
| | |
Net Assets | | | | | | | | |
Beginning of period | | | 4,247,542,620 | | | | 2,324,803,191 | |
| | | | | | | | |
End of period | | $ | 1,548,796,818 | | | $ | 4,247,542,620 | |
| | | | | | | | |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 19 |
Notes to Financial Statements
(Unaudited)
Jennison Natural Resources Fund, Inc. (the “Fund”), is registered under the Investment Company Act of 1940 as a non-diversified, open-end management investment company. The Fund’s investment objective is long-term growth of capital which it seeks to achieve by investing primarily in equity securities of foreign and domestic companies that own, explore, mine, process or otherwise develop, or provide goods and services with respect to, natural resources and in asset-based securities the terms of which are related to the market value of an underlying asset such as a natural resource.
Note 1. Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.
Securities Valuation: Securities listed on a securities exchange (other than options on securities and indices) are valued at the last sale price on such exchange on the day of valuation or, if there was no sale on such day, at the mean between the last reported bid and asked prices, or at the last bid price on such day in the absence of an asked price. Securities traded via Nasdaq are valued at the Nasdaq official closing price (NOCP) on the day of valuation, or if there was no NOCP, at the last sale price. Securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by Prudential Investments LLC (“PI” or “Manager”), in consultation with the subadvisers; to be over-the-counter, are valued at market value using prices provided by an independent pricing agent or principal market maker.
Corporate bonds (other than convertible debt securities) and U.S. government securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by an Adviser in consultation with the Manager to be over-the-counter, are valued by an independent pricing agent or more than one principal market maker (if available, otherwise by a principal market maker or a primary market dealer). Convertible debt securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by an Adviser in consultation with the Manager to be over-the-counter, are valued by an independent pricing agent or at the mean between the last reported bid and asked prices (or at the last bid price in the absence of an asked price) provided by more than one principal market maker (if available, otherwise by a principal market maker or a primary market dealer).
| | |
| 20 | | Visit our website at www.jennisondryden.com |
Securities for which reliable market quotations are not readily available, or whose values have been effected by events occurring after the close of the security’s foreign market and before the fund’s normal pricing time, are valued at fair value in accordance with the Board of Directors’ approved fair valuation procedures. When determining the fair valuation of securities some of the factors influencing the valuation include, the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the investment adviser regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other mutual funds to calculate their net asset values.
Investments in mutual funds are valued at their net asset value as of the close of the New York Stock Exchange on the date of valuation.
Short-term debt securities which mature in sixty days or less are valued at amortized cost, which approximates market value. The amortized cost method includes valuing a security at its cost on the date of purchase and thereafter assuming a constant amortization to maturity of the difference between the principal amount due at maturity and cost. Short-term debt securities which mature in more than sixty days are valued at current market quotation.
The Fund may hold up to 15% of its net assets in illiquid securities including repurchase agreements which have a maturity of longer than seven days, certain securities with legal or contractual restrictions on resale (restricted securities, sometimes referred to as Private Placements) and securities that are not readily marketable. Restricted securities are valued pursuant to the valuation procedures noted above.
Foreign Currency Translation: The books and records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on the following basis:
(i) market value of investment securities, other assets and liabilities at the current rates of exchange.
(ii) purchases and sales of investment securities, income and expenses at the rate of exchange prevailing on the respective dates of such transactions.
| | |
| Jennison Natural Resources Fund, Inc. | | 21 |
Notes to Financial Statements
(Unaudited) continued
Although the net assets of the Fund are presented at the foreign exchange rates and market values at the close of the period, the Fund does not isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities held at the end of the period. Similarly, the Fund does not isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of long-term portfolio securities sold during the period. Accordingly, realized foreign currency gains or losses are included in the reported net realized gain or loss on investment transactions.
Net realized gains or losses on foreign currency transactions represent net foreign exchange gains or losses from the holding of foreign currencies, currency gains or losses realized between the trade date and settlement date on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains or losses from valuing foreign currency denominated assets and liabilities (other than investments) at period end exchange rates are reflected as a component of net unrealized appreciation (depreciation) on investment and foreign currencies.
Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of domestic origin as a result of, among other factors, the possibility of political and economic instability, or the level of governmental supervision and regulation of foreign securities markets.
Securities Lending: The Fund may lend its portfolio securities to broker-dealers. The loans are secured by collateral at least equal at all times to the market value of the securities loaned. Loans are subject to termination at the option of the borrower or the Fund. Upon termination of the loan, the borrower will return to the Fund securities identical to the loaned securities. Should the borrower of the securities fail financially, the Fund has the right to repurchase the securities using the collateral in the open market. The Fund recognizes income, net of any rebate and securities lending agent fees, for lending its securities in the form of fees or interest on the investment of any cash received as collateral. The Fund also continues to receive interest and dividends or amounts equivalent thereto, on the securities loaned and recognizes any unrealized gain or loss in the market price of the securities loaned that may occur during the term of the loan.
| | |
| 22 | | Visit our website at www.jennisondryden.com |
Total Return Swap: Total return swap agreements are contracts in which one party agrees to make periodic payments based on the change in market value of the underlying assets, which may include a specified security, basket of securities or securities indices during the specified period, in return for periodic payments based on a fixed or variable interest rate or the total return from other underlying assets. Total return swap agreements may be used to obtain exposure to a security or market without owning or taking physical custody of such security or market.
Generally, the Fund will enter into total return swaps on a net basis (i.e., the two payment streams are netted out with the Fund receiving or paying, as the case may be, only the net amount of the two payments). The net amount of the excess, if any, of the Fund’s obligations over its entitlements with respect to each total return swap will be accrued on a daily basis, and an amount of cash or liquid instruments having an aggregate net asset value at least equal to the accrued excess will be segregated by the Fund. If the total return swap transaction is entered into on other than a net basis, the full amount of the Fund’s obligations will be accrued on a daily basis, and the full amount of the Fund’s obligations will be segregated by the Fund in an amount equal to or greater than the market value of the liabilities under the total return swap agreement or the amount it would have cost the Fund initially to make an equivalent direct investment, plus or minus any amount the Fund is obligated to pay or is to receive under the total return swap agreement.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains or losses on sales of securities are calculated on the identified cost basis. Dividend income is recorded on the exdividend date and interest income is recorded on the accrual basis. Expenses are recorded on the accrual basis.
Net investment income or loss, (other than distribution fees, which are charged directly to the respective class) and unrealized and realized gains or losses are allocated daily to each class of shares based upon the relative proportion of net assets of each class at the beginning of the day.
Dividends and Distributions: The Fund expects to pay dividends from net investment income and distributions from net realized capital and currency gains, if any, annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-dividend date.
Taxes: It is the Fund’s policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net investment income and capital gains, if any, to shareholders. Therefore,
| | |
| Jennison Natural Resources Fund, Inc. | | 23 |
Notes to Financial Statements
(Unaudited) continued
no federal income tax provision is required. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates.
Estimates: The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
Note 2. Agreements
The Fund has a management agreement with PI. Pursuant to a subadvisory agreement between PI and Jennison Associates LLC (“Jennison”), Jennison furnishes investment advisory services in connection with the management of the Fund. Under the subadvisory agreement, Jennison, subject to the supervision of PI, is responsible for managing the assets of the Fund in accordance with its investment objective and policies. PI pays for the services of Jennison, the compensation of officers of the Fund, occupancy and certain clerical and bookkeeping costs of the Fund. The Fund bears all other costs and expenses.
Pursuant to the management agreement between the Fund and PI, the management fee paid to PI is computed daily and payable monthly at an annual rate of .75 of 1% of average daily net assets up to $1 billion and .70 of 1% of average daily net assets in excess of $1 billion.
Through September 30, 2008, PI has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion that would otherwise be applicable under the terms of the management agreement. Effective October 1, 2008 through September 30, 2009, PI has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion that would otherwise be applicable under the terms of the management agreement. The effective management fee rate was .70 of 1% for the six months ended November 30, 2008.
The Fund has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, Class B, Class C, Class R and Class Z shares of the Fund. The Fund compensates PIMS for distributing and servicing the Fund’s Class A, Class B, Class C and Class R shares, pursuant to plans of distribution (the “Class A, B, C and R Plans”), regardless of expenses actually
| | |
| 24 | | Visit our website at www.jennisondryden.com |
incurred by PIMS. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z shares of the Fund.
Pursuant to the Class A, B, C and R Plans, the Fund compensates PIMS for distribution related activities at an annual rate of up to .30 of 1%, 1%, 1% and .75 of 1% of the average daily net assets of the Class A, B, C and Class R shares, respectively. PIMS had contractually agreed to limit such fees to .50 of 1% of the average daily net assets of the Class R shares through September 30, 2009.
PIMS has advised the Fund that it received approximately $3,369,600 in front-end sales charges resulting from sales of Class A shares, during the six months ended November 30, 2008. From these fees, PIMS paid such sales charges to affiliated broker-dealers, which in turn paid commissions to salespersons and incurred other distribution costs.
PIMS has advised the Fund that for the six months ended November 30, 2008, it received approximately $39,100, $532,700 and $379,300 in contingent deferred sales charges imposed upon redemptions by certain Class A, Class B and Class C shareholders, respectively.
PI, PIMS and Jennison are indirect, wholly-owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
Note 3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PI, and an indirect, wholly-owned subsidiary of Prudential, serves as the Fund’s transfer agent. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
The Fund pays networking fees to affiliated and unaffiliated broker/dealers including fees relating to the services of First Clearing, LLC (“First Clearing”) and Wachovia Securities, LLC (“Wachovia”), affiliates of PI. These networking fees are payments made to broker/dealers that clear mutual fund transactions through a national clearing system. For the six months ended November 30, 2008, the Fund incurred approximately $1,084,900 in total networking fees, of which approximately $134,400 and $5,000 were paid to First Clearing and Wachovia, respectively. These amounts are included in transfer agent’s fees and expenses in the Statement of Operations.
Prudential Investment Management, Inc. (“PIM”), an indirect, wholly-owned subsidiary of Prudential, is the Fund’s security lending agent. For the six months
| | |
| Jennison Natural Resources Fund, Inc. | | 25 |
Notes to Financial Statements
(Unaudited) continued
ended November 30, 2008, PIM has been compensated approximately $735,600 for these services.
The Fund invests in the Taxable Money Market Series (the “Portfolio”), a portfolio of Dryden Core Investment Fund. The Portfolio is a money market mutual fund registered under the Investment Company Act of 1940, as amended, and managed by PI.
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments, for the six months ended November 30, 2008 were $1,011,412,144 and $977,201,643, respectively.
Note 5. Distributions and Tax Information
The United States federal income tax basis of the Fund’s investments and the net unrealized depreciation as of November 30, 2008 were as follows:
| | | | | | |
Tax Basis of
Investments | | Appreciation | | Depreciation | | Net Unrealized
Depreciation |
| $2,596,152,279 | | $185,986,653 | | $(932,856,202) | | $(746,869,549) |
The differences between book basis and tax basis of investments are primarily attributable to deferred losses on wash sales.
Note 6. Capital
The Fund offers Class A, Class B, Class C, Class R and Class Z shares. Class A shares are sold with a front-end sales charge of up to 5.50%. All investors who purchase Class A shares in an amount of $1 million or more and sell these shares within 12 months of purchase are subject to a contingent deferred sales charge (CDSC) of 1%, including investors who purchase their shares through broker-dealers affiliated with Prudential. Class B shares are sold with a contingent deferred sales charge which declines from 5% to zero depending upon the period of time the shares are held. Class C shares are sold with a contingent deferred sales charge of 1% during the first 12 months. Class B shares automatically convert to Class A shares on a quarterly basis
| | |
| 26 | | Visit our website at www.jennisondryden.com |
approximately seven years after purchase. A special exchange privilege is also available for shareholders who qualify to purchase Class A shares at net asset value. Class R and Class Z shares are not subject to any sales or redemption charge and are offered exclusively for sale to a limited group of investors.
There are 500 million shares of $.01 par value common stock authorized divided into five classes, designated Class A, Class B, Class C, Class R and Class Z common stock, each of which consists of 100 million authorized shares.
Transactions in shares of common stock were as follows:
| | | | | | | |
Class A | | Shares | | | Amount | |
Six Months ended November 30, 2008: | | | | | | | |
Shares sold | | 6,974,761 | | | $ | 356,641,497 | |
Shares reacquired | | (10,300,695 | ) | | | (471,716,441 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding before conversion | | (3,325,934 | ) | | | (115,074,944 | ) |
Shares issued upon conversion from Class B | | 183,864 | | | | 11,171,913 | |
| | | | | | | |
Net increase (decrease) in shares outstanding | | (3,142,070 | ) | | $ | (103,903,031 | ) |
| | | | | | | |
Year ended May 31, 2008: | | | | | | | |
Shares sold | | 14,854,403 | | | $ | 895,176,340 | |
Shares issued in reinvestment of dividends and distributions | | 1,885,140 | | | | 106,717,427 | |
Shares reacquired | | (6,851,754 | ) | | | (407,109,970 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding before conversion | | 9,887,789 | | | | 594,783,797 | |
Shares issued upon conversion from Class B | | 293,726 | | | | 16,908,576 | |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 10,181,515 | | | $ | 611,692,373 | |
| | | | | | | |
Class B | | | | | | |
Six Months ended November 30, 2008: | | | | | | | |
Shares sold | | 600,846 | | | $ | 26,828,549 | |
Shares reacquired | | (1,211,920 | ) | | | (53,322,605 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding before conversion | | (611,074 | ) | | | (26,494,056 | ) |
Shares reacquired upon conversion into Class A | | (395,764 | ) | | | (11,171,913 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | (1,006,838 | ) | | $ | (37,665,969 | ) |
| | | | | | | |
Year ended May 31, 2008: | | | | | | | |
Shares sold | | 1,749,925 | | | $ | 90,765,803 | |
Shares issued in reinvestment of dividends and distributions | | 583,181 | | | | 28,429,233 | |
Shares reacquired | | (1,277,580 | ) | | | (65,191,605 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding before conversion | | 1,055,526 | | | | 54,003,431 | |
Shares reacquired upon conversion into Class A | | (339,787 | ) | | | (16,908,576 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 715,739 | | | $ | 37,094,855 | |
| | | | | | | |
| | |
| Jennison Natural Resources Fund, Inc. | | 27 |
Notes to Financial Statements
(Unaudited) continued
| | | | | | | |
Class C | | Shares | | | Amount | |
Six Months ended November 30, 2008: | | | | | | | |
Shares sold | | 2,216,720 | | | $ | 101,863,935 | |
Shares reacquired | | (4,508,804 | ) | | | (171,388,394 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | (2,292,084 | ) | | $ | (69,524,459 | ) |
| | | | | | | |
Year ended May 31, 2008: | | | | | | | |
Shares sold | | 6,734,719 | | | $ | 349,581,730 | |
Shares issued in reinvestment of dividends and distributions | | 888,499 | | | | 43,314,332 | |
Shares reacquired | | (2,530,695 | ) | | | (129,565,968 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 5,092,523 | | | $ | 263,330,094 | |
| | | | | | | |
Class R | | | | | | |
Six Months ended November 30, 2008: | | | | | | | |
Shares sold | | 210,755 | | | $ | 10,439,746 | |
Shares reacquired | | (118,129 | ) | | | (5,418,732 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 92,626 | | | $ | 5,021,014 | |
| | | | | | | |
Year ended May 31, 2008: | | | | | | | |
Shares sold | | 247,215 | | | $ | 15,053,063 | |
Shares issued in reinvestment of dividends and distributions | | 7,964 | | | | 451,237 | |
Shares reacquired | | (78,232 | ) | | | (4,753,385 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 176,947 | | | $ | 10,750,915 | |
| | | | | | | |
Class Z | | | | | | |
Six Months ended November 30, 2008: | | | | | | | |
Shares sold | | 3,439,361 | | | $ | 195,647,789 | |
Shares reacquired | | (3,908,923 | ) | | | (169,318,171 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | (469,562 | ) | | $ | 26,329,618 | |
| | | | | | | |
Year ended May 31, 2008: | | | | | | | |
Shares sold | | 5,220,045 | | | $ | 319,156,368 | |
Shares issued in reinvestment of dividends and distributions | | 516,273 | | | | 29,866,355 | |
Shares reacquired | | (1,918,168 | ) | | | (116,211,113 | ) |
| | | | | | | |
Net increase (decrease) in shares outstanding | | 3,818,150 | | | $ | 232,811,610 | |
| | | | | | | |
Note 7. Borrowings
The Fund, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with two banks. The SCA provides for a commitment of $500 million. Interest on any borrowings under the SCA is incurred at contracted market rates and a commitment fee for the unused
| | |
| 28 | | Visit our website at www.jennisondryden.com |
amount is accrued daily and paid quarterly. Effective October 24, 2008, the Funds renewed SCA with the banks. The commitment under the renewed SCA continues to be $500 million. The Funds pay a commitment fee of .13 of 1% of the unused portion of the renewed SCA. The expiration date of the renewed SCA will be October 23, 2009. For the period from October 26, 2007 through October 23, 2008, the Funds paid a commitment fee of .06 of 1% of the unused portion of the agreement. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions.
The Fund utilized the SCA during the six months ended November 30, 2008. The average daily balance for the 26 days the Fund had an outstanding balance was $10,678,308 at a weighted average interest rate of 2.44%. The outstanding balance as of November 30, 2008 was $5,890,000.
During the six months ended November 30, 2008, the Fund paid interest to the custodian for temporary overdrawn balances. The average outstanding balance was $14,741,934 at a weighted average interest rate of 3.61%.
Note 8. New Accounting Pronouncements
In March 2008, the Financial Accounting Standards Board (“FASB”) released Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities (“FAS 161”). FAS 161 requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. The application of FAS 161 is required for fiscal years beginning after November 15, 2008 and interim periods within those fiscal years. At this time, management is evaluating the implications of FAS 161 and its impact on the financial statements has not yet been determined.
| | |
| Jennison Natural Resources Fund, Inc. | | 29 |
Financial Highlights
(Unaudited)
| | | | |
| | | Class A | |
| | | Six Months Ended
November 30, 2008(a) | |
Per Share Operating Performance: | | | | |
Net Asset Value, Beginning Of Period | | $ | 68.29 | |
| | | | |
Income (loss) from investment operations: | | | | |
Net investment income (loss) | | | (.02 | ) |
Net realized and unrealized gain (loss) on investment and foreign currency transactions | | | (40.51 | ) |
| | | | |
Total from investment operations | | | (40.53 | ) |
| | | | |
Less Dividends and Distributions: | | | | |
Dividends from net investment income | | | — | |
Distributions from net realized gains on investments | | | — | |
| | | | |
Total dividends and distributions | | | — | |
| | | | |
Net asset value, end of period | | $ | 27.76 | |
| | | | |
Total Return(b): | | | (59.35 | )% |
Ratios/Supplemental Data: | | | | |
Net assets, end of period (000) | | $ | 762,582 | |
Average net assets (000) | | $ | 1,475,369 | |
Ratios to average net assets(c): | | | | |
Expenses, including distribution and service (12b-1) fees | | | 1.15 | %(d)(e) |
Expenses, excluding distribution and service (12b-1) fees | | | .85 | %(d)(e) |
Net investment income (loss) | | | (.06 | )%(d)(e) |
For Class A, B, C, R and Z shares: | | | | |
Portfolio turnover | | | 32 | %(f) |
| (a) | Calculated based on average daily shares outstanding during the period. |
| (b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
| (c) | Does not include the expenses of the underlying fund in which the Fund invests. |
| (d) | Through September 30, 2008, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion. |
| (g) | The distributor of the Fund has contractually agreed to limit its distribution and service (12b-1) fees to .25% of 1% of the average daily net assets of the Class A shares until September 30, 2007. |
See Notes to Financial Statements.
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| 30 | | Visit our website at www.jennisondryden.com |
| | | | | | | | | | | | | | | | | | |
| Class A | |
| Year Ended May 31, | |
| 2008(a) | | | 2007(a) | | | 2006(a) | | | 2005 | | | 2004 | |
| | | | | | | | | | | | | | | | | | |
| $ | 53.87 | | | $ | 48.25 | | | $ | 30.36 | | | $ | 23.33 | | | $ | 18.94 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (.12 | ) | | | (.03 | ) | | | .15 | | | | .11 | | | | (.06 | ) |
| | | | |
| | 19.61 | | | | 11.21 | | | | 20.28 | | | | 7.61 | | | | 4.96 | |
| | | | | | | | | | | | | | | | | | | |
| | 19.49 | | | | 11.18 | | | | 20.43 | | | | 7.72 | | | | 4.90 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (2.43 | ) | | | (.42 | ) | | | (.30 | ) | | | (.08 | ) | | | (.39 | ) |
| | (2.64 | ) | | | (5.14 | ) | | | (2.24 | ) | | | (.61 | ) | | | (.12 | ) |
| | | | | | | | | | | | | | | | | | | |
| | (5.07 | ) | | | (5.56 | ) | | | (2.54 | ) | | | (.69 | ) | | | (.51 | ) |
| | | | | | | | | | | | | | | | | | | |
| $ | 68.29 | | | $ | 53.87 | | | $ | 48.25 | | | $ | 30.36 | | | $ | 23.33 | |
| | | | | | | | | | | | | | | | | | | |
| | 38.15 | % | | | 25.03 | % | | | 69.16 | % | | | 33.24 | % | | | 26.24 | % |
| | | | | | | | | | | | | | | | | | |
| $ | 2,090,493 | | | $ | 1,100,431 | | | $ | 817,299 | | | $ | 327,162 | | | $ | 121,700 | |
| $ | 1,491,943 | | | $ | 847,853 | | | $ | 566,901 | | | $ | 215,619 | | | $ | 81,712 | |
| | | | | | | | | | | | | | | | | | |
| | 1.14 | %(d)(g) | | | 1.19 | %(g) | | | 1.14 | %(g) | | | 1.22 | %(g) | | | 1.41 | %(g) |
| | .85 | %(d) | | | .94 | % | | | .89 | % | | | .97 | % | | | 1.16 | % |
| | (.20 | )%(d) | | | (.07 | )% | | | .36 | % | | | .39 | % | | | (.27 | )% |
| | | | | | | | | | | | | | | | | | |
| | 21 | % | | | 46 | % | | | 34 | % | | | 30 | % | | | 6 | % |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 31 |
Financial Highlights
(Unaudited) continued
| | | | |
| | | Class B | |
| | | Six Months Ended
November 30, 2008(a) | |
Per Share Operating Performance: | | | | |
Net Asset Value, Beginning Of Period | | $ | 58.60 | |
| | | | |
Income (loss) from investment operations: | | | | |
Net investment loss | | | (.16 | ) |
Net realized and unrealized gain (loss) on investment and foreign currency transactions | | | (34.70 | ) |
| | | | |
Total from investment operations | | | (34.86 | ) |
| | | | |
Less Dividends and Distributions: | | | | |
Dividends from net investment income | | | — | |
Distributions from net realized gains on investments | | | — | |
| | | | |
Total dividends and distributions | | | — | |
| | | | |
Net asset value, end of period | | $ | 23.74 | |
| | | | |
Total Return(b): | | | (59.49 | )% |
Ratios/Supplemental Data: | | | | |
Net assets, end of period (000) | | $ | 152,925 | |
Average net assets (000) | | $ | 297,834 | |
Ratios to average net assets(c): | | | | |
Expenses, including distribution and service (12b-1) fees | | | 1.85 | %(d)(e) |
Expenses, excluding distribution and service (12b-1) fees | | | .85 | %(d)(e) |
Net investment loss | | | (.76 | )%(d)(e) |
| (a) | Calculated based on average daily shares outstanding during the period. |
| (b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
| (c) | Does not include the expenses of the underlying fund in which the Fund invests. |
| (d) | Through September 30, 2008, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion. |
See Notes to Financial Statements.
| | |
| 32 | | Visit our website at www.jennisondryden.com |
| | | | | | | | | | | | | | | | | | |
| Class B | |
| Year Ended May 31, | |
| 2008(a) | | | 2007(a) | | | 2006(a) | | | 2005 | | | 2004 | |
| | | | | | | | | | | | | | | | | | |
| $ | 46.90 | | | $ | 42.70 | | | $ | 27.13 | | | $ | 20.99 | | | $ | 17.09 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (.44 | ) | | | (.34 | ) | | | (.15 | ) | | | (.09 | ) | | | (.20 | ) |
| | | | |
| | 16.90 | | | | 9.79 | | | | 18.05 | | | | 6.84 | | | | 4.46 | |
| | | | | | | | | | | | | | | | | | | |
| | 16.46 | | | | 9.45 | | | | 17.90 | | | | 6.75 | | | | 4.26 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (2.12 | ) | | | (.11 | ) | | | (.09 | ) | | | — | | | | (.24 | ) |
| | (2.64 | ) | | | (5.14 | ) | | | (2.24 | ) | | | (.61 | ) | | | (.12 | ) |
| | | | | | | | | | | | | | | | | | | |
| | (4.76 | ) | | | (5.25 | ) | | | (2.33 | ) | | | (.61 | ) | | | (.36 | ) |
| | | | | | | | | | | | | | | | | | | |
| $ | 58.60 | | | $ | 46.90 | | | $ | 42.70 | | | $ | 27.13 | | | $ | 20.99 | |
| | | | | | | | | | | | | | | | | | | |
| | 37.14 | % | | | 24.10 | % | | | 67.84 | % | | | 32.30 | % | | | 25.28 | % |
| | | | | | | | | | | | | | | | | | |
| $ | 436,506 | | | $ | 315,782 | | | $ | 271,419 | | | $ | 132,157 | | | $ | 52,684 | |
| $ | 360,663 | | | $ | 265,189 | | | $ | 206,935 | | | $ | 91,588 | | | $ | 40,985 | |
| | | | | | | | | | | | | | | | | | |
| | 1.85 | %(d) | | | 1.94 | % | | | 1.89 | % | | | 1.97 | % | | | 2.16 | % |
| | .85 | %(d) | | | .94 | % | | | .89 | % | | | .97 | % | | | 1.16 | % |
| | (.86 | )%(d) | | | (.82 | )% | | | (.40 | )% | | | (.36 | )% | | | (1.03 | )% |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 33 |
Financial Highlights
(Unaudited) continued
| | | | |
| | | Class C | |
| | | Six Months Ended
November 30, 2008(a) | |
Per Share Operating Performance: | | | | |
Net Asset Value, Beginning Of Period | | $ | 58.61 | |
| | | | |
Income (loss) from investment operations: | | | | |
Net investment loss | | | (.16 | ) |
Net realized and unrealized gain (loss) on investment and foreign
currency transactions | | | (34.71 | ) |
| | | | |
Total from investment operations | | | (34.87 | ) |
| | | | |
Less Dividends and Distributions: | | | | |
Dividends from net investment income | | | — | |
Distributions from net realized gains on investments | | | — | |
| | | | |
Total dividends and distributions | | | — | |
| | | | |
Net asset value, end of period | | $ | 23.74 | |
| | | | |
Total Return(b): | | | (59.49 | )% |
Ratios/Supplemental Data: | | | | |
Net assets, end of period (000) | | $ | 344,986 | |
Average net assets (000) | | $ | 687,925 | |
Ratios to average net assets(c): | | | | |
Expenses, including distribution and service (12b-1) fees | | | 1.85 | %(d)(e) |
Expenses, excluding distribution and service (12b-1) fees | | | .85 | %(d)(e) |
Net investment loss | | | (.76 | )%(d)(e) |
| (a) | Calculated based on average daily shares outstanding during the period. |
| (b) | Total return does not consider the effects of sales loads. Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
| (c) | Does not include the expenses of the underlying fund in which the Fund invests. |
| (d) | Through September 30, 2008, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion. |
See Notes to Financial Statements.
| | |
| 34 | | Visit our website at www.jennisondryden.com |
| | | | | | | | | | | | | | | | | | |
| Class C | |
| Year Ended May 31, | |
| 2008(a) | | | 2007(a) | | | 2006(a) | | | 2005 | | | 2004 | |
| | | | | | | | | | | | | | | | | | |
| $ | 46.90 | | | $ | 42.70 | | | $ | 27.13 | | | $ | 20.99 | | | $ | 17.09 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (.46 | ) | | | (.34 | ) | | | (.15 | ) | | | (.09 | ) | | | (.20 | ) |
| | | | |
| | 16.93 | | | | 9.79 | | | | 18.05 | | | | 6.84 | | | | 4.46 | |
| | | | | | | | | | | | | | | | | | | |
| | 16.47 | | | | 9.45 | | | | 17.90 | | | | 6.75 | | | | 4.26 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (2.12 | ) | | | (.11 | ) | | | (.09 | ) | | | — | | | | (.24 | ) |
| | (2.64 | ) | | | (5.14 | ) | | | (2.24 | ) | | | (.61 | ) | | | (.12 | ) |
| | | | | | | | | | | | | | | | | | | |
| | (4.76 | ) | | | (5.25 | ) | | | (2.33 | ) | | | (.61 | ) | | | (.36 | ) |
| | | | | | | | | | | | | | | | | | | |
| $ | 58.61 | | | $ | 46.90 | | | $ | 42.70 | | | $ | 27.13 | | | $ | 20.99 | |
| | | | | | | | | | | | | | | | | | | |
| | 37.14 | % | | | 24.10 | % | | | 67.84 | % | | | 32.30 | % | | | 25.28 | % |
| | | | | | | | | | | | | | | | | | |
| $ | 985,867 | | | $ | 550,097 | | | $ | 406,571 | | | $ | 138,176 | | | $ | 32,612 | |
| $ | 724,878 | | | $ | 428,643 | | | $ | 261,145 | | | $ | 79,352 | | | $ | 16,347 | |
| | | | | | | | | | | | | | | | | | |
| | 1.85 | %(d) | | | 1.94 | % | | | 1.89 | % | | | 1.97 | % | | | 2.16 | % |
| | .85 | %(d) | | | .94 | % | | | .89 | % | | | .97 | % | | | 1.16 | % |
| | (.90 | )%(d) | | | (.82 | )% | | | (.40 | )% | | | (.37 | )% | | | (1.00 | )% |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 35 |
Financial Highlights
(Unaudited) continued
| | | | |
| | | Class R | |
| |
| | | Six Months Ended
November 30, 2008(b) | |
Per Share Operating Performance: | | | | |
Net Asset Value, Beginning Of Period | | $ | 68.28 | |
| | | | |
Income (loss) from investment operations: | | | | |
Net investment loss | | | (.06 | ) |
Net realized and unrealized gain (loss) on investment and foreign currency transactions | | | (40.48 | ) |
| | | | |
Total from investment operations | | | (40.54 | ) |
| | | | |
Less Dividends and Distributions: | | | | |
Dividends from net investment income | | | — | |
Distributions from net realized gains on investments | | | — | |
| | | | |
Total dividends and distributions | | | — | |
| | | | |
Net asset value, end of period | | $ | 27.74 | |
| | | | |
Total Return(c): | | | (59.37 | )% |
Ratios/Supplemental Data: | | | | |
Net assets, end of period (000) | | $ | 8,798 | |
Average net assets (000) | | $ | 13,252 | |
Ratios to average net assets(d): | | | | |
Expenses, including distribution and service (12b-1) fees(e) | | | 1.35 | %(f)(g) |
Expenses, excluding distribution and service (12b-1) fees | | | .85 | %(f)(g) |
Net investment loss | | | (.24 | )%(f)(g) |
| (a) | Inception date of Class R shares. |
| (b) | Calculated based on average daily shares outstanding during the period. |
| (c) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized. |
| (d) | Does not include the expenses of the underlying fund in which the Fund invests. |
| (e) | The distributor of the Fund has contractually agreed to limit its distribution and service (12b-1) fees to .50 of 1% of the average daily net assets of the Class R shares. |
| (f) | Through September 30, 2008, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion. |
See Notes to Financial Statements.
| | |
| 36 | | Visit our website at www.jennisondryden.com |
| | | | | | |
| Class R | |
Year Ended May 31, 2008(b) | | | August 22, 2006(a)
through May 31, 2007(b) | |
| | | | | | |
| $ | 53.96 | | | $ | 47.85 | |
| | | | | | | |
| | | | | | |
| | (.37 | ) | | | (.08 | ) |
| |
| | 19.74 | | | | 11.63 | |
| | | | | | | |
| | 19.37 | | | | 11.55 | |
| | | | | | | |
| | | | | | |
| | (2.41 | ) | | | (.30 | ) |
| | (2.64 | ) | | | (5.14 | ) |
| | | | | | | |
| | (5.05 | ) | | | (5.44 | ) |
| | | | | | | |
| $ | 68.28 | | | $ | 53.96 | |
| | | | | | | |
| | 37.82 | % | | | 25.98 | % |
| | | | | | |
| $ | 15,328 | | | $ | 2,565 | |
| $ | 6,730 | | | $ | 626 | |
| | | | | | |
| | 1.35 | %(f) | | | 1.44 | %(g) |
| | .85 | %(f) | | | .94 | %(g) |
| | (.62 | )%(f) | | | (.24 | )%(g) |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 37 |
Financial Highlights
(Unaudited) continued
| | | | |
| | | Class Z | |
| | | Six Months Ended
November 30, 2008(a) | |
Per Share Operating Performance: | | | | |
Net Asset Value, Beginning Of Period | | $ | 69.90 | |
| | | | |
Income (loss) from investment operations: | | | | |
Net investment income | | | .06 | |
Net realized and unrealized gain (loss) on investment and foreign currency transactions | | | (41.50 | ) |
| | | | |
Total from investment operations | | | (41.44 | ) |
| | | | |
Less Dividends and Distributions: | | | | |
Dividends from net investment income | | | — | |
Distributions from net realized gains on investments | | | — | |
| | | | |
Total dividends and distributions | | | — | |
| | | | �� |
Net asset value, end of period | | $ | 28.46 | |
| | | | |
Total Return(b): | | | (59.28 | )% |
Ratios/Supplemental Data: | | | | |
Net assets, end of period (000) | | $ | 279,506 | |
Average net assets (000) | | $ | 553,102 | |
Ratios to average net assets(d): | | | | |
Expenses, including distribution and service (12b-1) fees | | | .85 | %(e)(f) |
Expenses, excluding distribution and service (12b-1) fees | | | .85 | %(e)(f) |
Net investment income (loss) | | | .24 | %(e)(f) |
| (a) | Calculated based on average daily shares outstanding during the period. |
| (b) | Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
| (c) | Less than $.005 per share. |
| (d) | Does not include the expenses of the underlying fund in which the Fund invests. |
| (e) | Through September 30, 2008, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $2 billion. Effective October 1, 2008 through September 30, 2009, the manager of the Fund has contractually agreed to waive .05 of 1% of the management fee rate on average daily net assets over $4 billion. |
See Notes to Financial Statements.
| | |
| 38 | | Visit our website at www.jennisondryden.com |
| | | | | | | | | | | | | | | | | | |
| Class Z | |
| Year Ended May 31, | |
| 2008(a) | | | 2007(a) | | | 2006(a) | | | 2005 | | | 2004 | |
| | | | | | | | | | | | | | | | | | |
| $ | 54.99 | | | $ | 49.12 | | | $ | 30.87 | | | $ | 23.70 | | | $ | 19.24 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | .05 | | | | .08 | | | | .26 | | | | .19 | | | | — | (c) |
| | | | |
| | 20.05 | | | | 11.46 | | | | 20.60 | | | | 7.74 | | | | 5.02 | |
| | | | | | | | | | | | | | | | | | | |
| | 20.10 | | | | 11.54 | | | | 20.86 | | | | 7.93 | | | | 5.02 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | (2.55 | ) | | | (.53 | ) | | | (.37 | ) | | | (.15 | ) | | | (.44 | ) |
| | (2.64 | ) | | | (5.14 | ) | | | (2.24 | ) | | | (.61 | ) | | | (.12 | ) |
| | | | | | | | | | | | | | | | | | | |
| | (5.19 | ) | | | (5.67 | ) | | | (2.61 | ) | | | (.76 | ) | | | (.56 | ) |
| | | | | | | | | | | | | | | | | | | |
| $ | 69.90 | | | $ | 54.99 | | | $ | 49.12 | | | $ | 30.87 | | | $ | 23.70 | |
| | | | | | | | | | | | | | | | | | | |
| | 38.53 | % | | | 25.39 | % | | | 69.44 | % | | | 33.64 | % | | | 26.49 | % |
| | | | | | | | | | | | | | | | | | |
| $ | 719,348 | | | $ | 355,928 | | | $ | 270,375 | | | $ | 109,569 | | | $ | 44,663 | |
| $ | 503,262 | | | $ | 283,266 | | | $ | 179,109 | | | $ | 83,864 | | | $ | 25,894 | |
| | | | | | | | | | | | | | | | | | |
| | .85 | %(e) | | | .94 | % | | | .89 | % | | | .97 | % | | | 1.16 | % |
| | .85 | %(e) | | | .94 | % | | | .89 | % | | | .97 | % | | | 1.16 | % |
| | .08 | %(e) | | | .18 | % | | | .60 | % | | | .65 | % | | | (.02 | )% |
See Notes to Financial Statements.
| | |
| Jennison Natural Resources Fund, Inc. | | 39 |
Approval of Advisory Agreements
The Board of Directors (the “Board”) of Jennison Natural Resources Fund, Inc. (the “Fund”) oversees the management of the Fund and, as required by law, determines annually whether to renew the Fund’s management agreement with Prudential Investments LLC (“PI”) and the Fund’s subadvisory agreement with Jennison Associates LLC (“Jennison”). In considering the renewal of the agreements, the Board, including all of the Independent Directors, met on June 3-5, 2008 and approved the renewal of the agreements through July 31, 2009, after concluding that renewal of the agreements was in the best interests of the Fund and its shareholders.
In advance of the meetings, the Board received materials relating to the agreements, and had the opportunity to ask questions and request further information in connection with their consideration. Among other things, the Board considered comparisons with other mutual funds in relevant Peer Universes and Peer Groups. The mutual funds included in each Peer Universe or Peer Group were objectively determined solely by Lipper Inc., an independent provider of mutual fund data. The comparisons placed the Fund in various quartiles over one-, three-, five-, and ten-year time periods ending December 31, 2007, with the first quartile being the best 25% of the mutual funds (for performance, the best performing mutual funds and, for expenses, the lowest cost mutual funds).
In approving the agreements, the Board, including the Independent Directors advised by independent legal counsel, considered the factors they deemed relevant, including the nature, quality and extent of services provided, the performance of the Fund, the profitability of PI and its affiliates, expenses and fees, and the potential for economies of scale that may be shared with the Fund and its shareholders. In their deliberations, the Directors did not identify any single factor which alone was responsible for the Board’s decision to approve the agreements with respect to the Fund. In connection with their deliberations, the Board considered information provided by PI throughout the year at regular Board meetings, presentations from portfolio managers and other information, as well as information furnished at or in advance of the meetings on June 3-5, 2008.
The Directors determined that the overall arrangements between the Fund and PI, which serves as the Fund’s investment manager pursuant to a management agreement, and between PI and Jennison, which serves as the Fund’s subadviser pursuant to the terms of a subadvisory agreement with PI, are fair and reasonable in light of the services performed, fees charged and such other matters as the Directors considered relevant in the exercise of their business judgment.
| | |
| Jennison Natural Resources Fund, Inc. | | |
Approval of Advisory Agreements (continued)
The material factors and conclusions that formed the basis for the Directors’ reaching their determinations to approve the continuance of the agreements are separately discussed below.
Nature, Quality, and Extent of Services
The Board received and considered information regarding the nature and extent of services provided to the Fund by PI and Jennison. The Board considered the services provided by PI, including but not limited to the oversight of the subadviser for the Fund, as well as the provision of fund recordkeeping, compliance, and other services to the Fund. With respect to PI’s oversight of the subadviser, the Board noted that PI’s Strategic Investment Research Group (“SIRG”), which is a business unit of PI, is responsible for monitoring and reporting to PI’s senior management on the performance and operations of the subadviser. The Board also considered that PI pays the salaries of all of the officers and non-independent Directors of the Fund. The Board also considered the investment subadvisory services provided by Jennison, as well as adherence to the Fund’s investment restrictions and compliance with applicable Fund policies and procedures. The Board considered PI’s evaluation of the subadviser, as well as PI’s recommendation, based on its review of the subadviser, to renew the subadvisory agreement.
The Board reviewed the qualifications, backgrounds and responsibilities of PI’s senior management responsible for the oversight of the Fund and Jennison, and also reviewed the qualifications, backgrounds and responsibilities of Jennison’s portfolio managers who are responsible for the day-to-day management of the Fund’s portfolio. The Board was provided with information pertaining to PI’s and Jennison’s organizational structure, senior management, investment operations, and other relevant information pertaining to both PI and Jennison. The Board also noted that it received favorable compliance reports from the Fund’s Chief Compliance Officer (“CCO”) as to both PI and Jennison. The Board noted that Jennison is affiliated with PI.
The Board concluded that it was satisfied with the nature, extent and quality of the investment management services provided by PI and the subadvisory services provided to the Fund by Jennison, and that there was a reasonable basis on which to conclude that the Fund benefits from the services provided by PI and Jennison under the management and subadvisory agreements.
Performance of Jennison Natural Resources Fund
The Board received and considered information about the Fund’s historical performance. The Board considered that the Fund’s gross performance in relation to its Peer Universe (the Lipper Global Natural Resources Fund Performance Universe)
| | |
| | Visit our website at www.jennisondryden.com |
was in the first quartile over the one-, three-, five-, and ten-year periods. The Board also noted that the Fund outperformed its benchmark index over the same periods. The Board concluded that, in light of the Fund’s competitive performance, it would be in the interest of the Fund and its shareholders for the Fund to renew the agreements.
Fees and Expenses
The Board considered that the Fund’s actual management fee (which reflects any subsidies, expense caps or waivers) ranked in the Expense Group’s second quartile, while the Fund’s total expenses ranked in the Expense Group’s first quartile. The Board concluded that the management and subadvisory fees are reasonable in light of the services provided.
Costs of Services and Profits Realized by PI
The Board was provided with information on the profitability of PI and its affiliates in serving as the Fund’s investment manager. The Board discussed with PI the methodology utilized in assembling the information regarding profitability and considered its reasonableness. The Board recognized that it is difficult to make comparisons of profitability from fund management contracts because comparative information is not generally publicly available and is affected by numerous factors, including the structure of the particular adviser, the types of funds it manages, its business mix, numerous assumptions regarding allocations and the adviser’s capital structure and cost of capital. The Board did not separately consider the profitability of the subadviser, an affiliate of PI, as its profitability was reflected in the profitability report for PI. Taking these factors into account, the Board concluded that the profitability of PI and its affiliates in relation to the services rendered was not unreasonable.
Economies of Scale
The Board noted that the management fee schedule for the Fund includes breakpoints, which have the effect of decreasing the fee rate as assets increase, and that at its current level of assets the Fund’s effective fee rate reflected some of those rate reductions. The Board received and discussed information concerning whether PI realizes economies of scale as the Fund’s assets grow beyond current levels. The Board took note that the Fund’s fee structure currently results in benefits to Fund shareholders whether or not PI realizes any economies of scale.
Other Benefits to PI and Jennison
The Board considered potential ancillary benefits that might be received by PI and Jennison and their affiliates as a result of their relationship with the Fund. The Board concluded that potential benefits to be derived by PI included brokerage commissions
| | |
| Jennison Natural Resources Fund, Inc. | | |
Approval of Advisory Agreements (continued)
received by affiliates of PI, transfer agency fees received by the Fund’s transfer agent (which is affiliated with PI), benefits to the reputation as well as other intangible benefits resulting from PI’s association with the Fund. The Board concluded that the potential benefits to be derived by Jennison included its ability to use soft dollar credits, brokerage commissions received by affiliates of Jennison, as well as the potential benefits consistent with those generally resulting from an increase in assets under management, specifically, potential access to additional research resources and benefits to the reputation. The Board concluded that the benefits derived by PI and Jennison were consistent with the types of benefits generally derived by investment managers and subadvisers to mutual funds.
After full consideration of these factors, the Board concluded that approval of the agreements was in the best interest of the Fund and its shareholders.
| | |
| | Visit our website at www.jennisondryden.com |
| | | | |
| n MAIL | | n TELEPHONE | | n WEBSITE |
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102 | | (800) 225-1852
| | www.jennisondryden.com |
|
| PROXY VOTING |
| The Board of Directors of the Fund has delegated to the Fund’s investment subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852 or by visiting the Securities and Exchange Commission’s website at www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Commission’s website. |
|
| DIRECTORS |
| Kevin J. Bannon • Linda W. Bynoe • David E.A. Carson • Robert F. Gunia • Michael S. Hyland • Robert E. La Blanc • Douglas H. McCorkindale • Stephen P. Munn • Richard A. Redeker • Judy A. Rice • Robin B. Smith • Stephen G. Stoneburn |
|
| OFFICERS |
| Judy A. Rice, President • Robert F. Gunia, Vice President • Grace C. Torres, Treasurer and Principal Financial and Accounting Officer • Kathryn L. Quirk, Chief Legal Officer • Deborah A. Docs, Secretary • Timothy J. Knierim, Chief Compliance Officer • Valerie M. Simpson, Deputy Chief Compliance Officer • Theresa C. Thompson, Deputy Chief Compliance Officer • Noreen M. Fierro, Anti-Money Laundering Compliance Officer • Jonathan D. Shain, Assistant Secretary • Claudia DiGiacomo, Assistant Secretary • John P. Schwartz, Assistant Secretary • Andrew R. French, Assistant Secretary • M. Sadiq Peshimam, Assistant Treasurer • Peter Parrella, Assistant Treasurer |
| | | | |
| MANAGER | | Prudential Investments LLC | | Gateway Center Three
100 Mulberry Street Newark, NJ 07102 |
|
| INVESTMENT SUBADVISER | | Jennison Associates LLC | | 466 Lexington Avenue
New York, NY 10017 |
|
| DISTRIBUTOR | | Prudential Investment
Management Services LLC | | Gateway Center Three
100 Mulberry Street Newark, NJ 07102 |
|
| CUSTODIAN | | The Bank of New York Mellon | | One Wall Street
New York, NY 10286 |
|
| TRANSFER AGENT | | Prudential Mutual Fund
Services LLC | | PO Box 9658
Providence, RI 02940 |
|
| INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | | KPMG LLP | | 345 Park Avenue
New York, NY 10154 |
|
| FUND COUNSEL | | Sullivan & Cromwell LLP | | 125 Broad Street
New York, NY 10004 |
|
| An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus for the Fund contains this and other information about the Fund. An investor may obtain a prospectus by visiting our website at www.jennisondryden.com or by calling (800) 225-1852. The prospectus should be read carefully before investing. |
|
| E-DELIVERY |
| To receive your mutual fund documents on-line, go to www.icsdelivery.com/prudential/funds and enroll. Instead of receiving printed documents by mail, you will receive notification via e-mail when new materials are available. You can cancel your enrollment or change your e-mail address at any time by clicking on the change/cancel enrollment option at the icsdelivery website address. |
|
| SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
| Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, Jennison Natural Resources Fund, Inc., Prudential Investments, Attn: Board of Directors, 100 Mulberry Street, Gateway Center Three, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
|
| AVAILABILITY OF PORTFOLIO SCHEDULE |
| The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. Information on the operation and location of the Public Reference Room may be obtained by calling (202) 551-8090. The Fund’s schedule of portfolio holdings is also available on the Fund’s website as of the end of each fiscal quarter. |
Mutual Funds:
| | | | |
ARE NOT INSURED BY THE FDIC OR ANY
FEDERAL GOVERNMENT AGENCY | | MAY LOSE VALUE | | ARE NOT A DEPOSIT OF OR GUARANTEED
BY ANY BANK OR ANY BANK AFFILIATE |
| | | | | | | | | | | | | | |
| | | Jennison Natural Resources Fund, Inc. | | |
| | | Share Class | | A | | B | | C | | R | | Z | | |
| | NASDAQ | | PGNAX | | PRGNX | | PNRCX | | JNRRX | | PNRZX | | |
| | CUSIP | | 476293105 | | 476293204 | | 476293303 | | 476293501 | | 476293402 | | |
| | | | | | | | | | | | | | |
MF135E2 IFS-A160323 Ed. 01/2009
Item 2 – Code of Ethics – Not required, as this is not an annual filing.
Item 3 – Audit Committee Financial Expert – Not required, as this is not an annual filing.
Item 4 – Principal Accountant Fees and Services – Not required, as this is not an annual filing.
Item 5 – Audit Committee of Listed Registrants – Not applicable.
Item 6 – Schedule of Investments – The schedule is included as part of the report to shareholders filed under Item 1 of this Form.
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 Company and Affiliated Purchasers – Not applicable.
Item 10 – Submission of Matters to a Vote of Security Holders – Not applicable.
Item 11 – Controls and Procedures
| | (a) | It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure. |
| | (b) | There has been no significant change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter of the period covered by this report that has materially affected, or is likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12 – Exhibits
| | | | |
| (a) | | (1) | | Code of Ethics – Not required, as this is not an annual filing. |
| | |
| | (2) | | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.CERT. |
| | |
| | (3) | | Any written solicitation to purchase securities under Rule 23c-1. – Not applicable. |
| |
| (b) | | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-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.
| | |
| (Registrant) | | Jennison Natural Resources Fund, Inc. |
| | | | |
| By (Signature and Title)* | | /s/ Deborah A. Docs | | |
| | Deborah A. Docs | | |
| | Secretary | | |
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 (Signature and Title)* | | /s/ Judy A. Rice | | |
| | Judy A. Rice | | |
| | President and Principal Executive Officer | | |
| | | | |
| By (Signature and Title)* | | /s/ Grace C. Torres | | |
| | Grace C. Torres | | |
| | Treasurer and Principal Financial Officer | | |
* | Print the name and title of each signing officer under his or her signature. |
