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 811-4108
Oppenheimer High Income Fund/VA
(Exact name of registrant as specified in charter)
6803 South Tucson Way, Centennial, Colorado 80112-3924
(Address of principal executive offices)
(Zip code)
Robert G. Zack, Esq.
OppenheimerFunds, Inc.
498 Seventh Avenue, New York, New York 10018
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(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
--------------
Date of fiscal year end: December 31
Date of reporting period: January 1, 2003 - June 30, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
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STATEMENT OF INVESTMENTS June 30, 2003 / Unaudited
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Principal Market Value
Amount See Note 1
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Asset-Backed Securities--0.1%
Consumer Credit Reference Index
Securities Program, Credit Card Asset-
Backed Certificates, Series 2002-B,
Cl. FX, 10.421%, 3/22/07 1
(Cost $497,606) $ 500,000 $ 527,663
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Mortgage-Backed Obligations--1.8%
Asset Securitization Corp.,
Commercial Mtg. Pass-Through
Certificates, Series 1996-D2, Cl. A3,
7.498%, 2/14/29 2 3,000,000 3,286,791
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CBA Mortgage Corp., Commercial
Mtg. Pass-Through Certificates,
Series 1993-C1, Cl. F, 6.72%, 12/25/03 1 700,000 676,375
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First Chicago/Lennar Trust 1,
Commercial Mtg. Pass-Through
Certificates:
Series 1997-CHL1, Cl. D, 7.939%,
4/29/39 1,2 300,000 308,297
Series 1997-CHL1, Cl. E, 9.939%,
4/29/39 1,2 1,500,000 1,316,484
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Morgan Stanley Capital I, Inc.,
Commercial Mtg. Pass-Through
Certificates, Series 1997-RR, Cl. D,
7.642%, 4/30/39 2,3 2,150,116 2,053,705
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Salomon Brothers Mortgage
Securities VII, Inc., Commercial
Mtg. Pass-Through Certificates,
Series 1996-B, Cl. 1, 6.893%,
4/25/26 1,2 430,234 382,908
-------------
Total Mortgage-Backed Obligations
(Cost $7,456,084) 8,024,560
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Loan Participations--0.0%
Telergy, Inc., Sr. Sec. Credit Facilities
Term Loan, Tranche A, 11.111%,
1/1/02 1,4,5 (Cost $966,644) 986,362 --
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Corporate Bonds and Notes--83.2%
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Consumer Discretionary--23.8%
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Auto Components--2.0%
Collins & Aikman Floorcoverings,
Inc., 9.75% Sr. Sub. Nts., Series B,
2/15/10 1 800,000 840,000
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Collins & Aikman Products Co.,
10.75% Sr. Nts., 12/31/11 500,000 442,500
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Dana Corp.:
9% Unsec. Nts., 8/15/11 980,000 1,065,750
10.125% Nts., 3/15/10 500,000 553,750
Principal Market Value
Amount See Note 1
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Auto Components Continued
Dura Operating Corp.:
8.625% Sr. Nts., Series B, 4/15/12 $ 1,000,000 $ 1,030,000
9% Sr. Sub. Nts., Series B, 5/1/09 [EUR] 300,000 318,667
9% Sr. Unsec. Sub. Nts., Series D,
5/1/09 200,000 185,000
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Exide Corp., 10% Sr. Unsec. Nts.,
4/15/05 1,4,5 600,000 15,000
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Lear Corp., 8.11% Sr. Unsec. Nts.,
Series B, 5/15/09 1,400,000 1,610,000
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Metaldyne Corp., 11% Sr. Sub.
Nts., 6/15/12 750,000 626,250
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Stoneridge, Inc., 11.50% Sr. Nts.,
5/1/12 900,000 1,012,500
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Tenneco Automotive, Inc.,
10.25% Sr. Sec. Nts., 7/15/13 3 700,000 712,250
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United Components, Inc.,
9.375% Sr. Sub. Nts., 6/15/13 3 400,000 417,000
-------------
8,828,667
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Automobiles--0.4%
DirecTV Holdings LLC, 8.375%
Sr. Nts., 3/15/13 3 1,800,000 2,016,000
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Hotels, Restaurants & Leisure--6.4%
Apcoa, Inc., 9.25% Sr. Unsec. Sub.
Nts., 3/15/08 1 940,000 333,700
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Aztar Corp., 9% Sr. Unsec. Sub.
Nts., 8/15/11 450,000 489,375
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Boca Resorts, Inc., 9.875% Sr. Sub.
Nts., 4/15/09 800,000 866,000
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Boyd Gaming Corp., 8.75% Sr. Sub.
Nts., 4/15/12 800,000 880,000
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Capital Gaming International, Inc.,
11.50% Promissory Nts., 8/1/1995 1,4,5 9,500 --
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Coast Hotels & Casinos, Inc.,
9.50% Sr. Unsec. Sub. Nts., 4/1/09 1,100,000 1,182,500
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Dominos, Inc., 8.25% Sr. Sub. Nts.,
7/1/11 3 800,000 830,000
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Family Restaurants, Inc., 10.875%
Sr. Sub. Disc. Nts., 2/1/04 1,4,5 100,000 875
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Herbst Gaming, Inc., 10.75% Sr.
Sec. Nts., 9/1/08 250,000 276,875
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Hilton Hotels Corp.:
7.625% Nts., 5/15/08 700,000 756,000
7.625% Nts., 12/1/12 500,000 550,000
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Hollywood Park, Inc., 9.25% Sr.
Unsec. Sub. Nts., Series B, 2/15/07 500,000 495,000
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Intrawest Corp., 9.75% Sr. Nts.,
8/15/08 900,000 943,875
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Isle of Capri Casinos, Inc.,
9% Sr. Sub. Nts., 3/15/12 600,000 657,000
3 OPPENHEIMER HIGH INCOME FUND/VA
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STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
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Hotels, Restaurants & Leisure Continued
John Q. Hammons Hotels, Inc.,
8.875% Sr. Nts., Series B, 5/15/12 $ 900,000 $ 949,500
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Jupiters Ltd., 8.50% Sr. Unsec. Nts.,
3/1/06 1 1,000,000 1,105,000
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Mandalay Resort Group, 10.25% Sr.
Unsec. Sub. Nts., Series B, 8/1/07 800,000 908,000
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MGM Mirage, Inc., 8.375% Sr. Unsec.
Sub. Nts., 2/1/11 1,700,000 1,942,250
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Mohegan Tribal Gaming Authority:
8% Sr. Sub. Nts., 4/1/12 700,000 759,500
8.375% Sr. Sub. Nts., 7/1/11 1,200,000 1,305,000
8.75% Sr. Unsec. Sub. Nts., 1/1/09 1,000,000 1,082,500
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Park Place Entertainment Corp.,
7.875% Sr. Sub. Nts., 3/15/10 1,500,000 1,620,000
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Penn National Gaming, Inc.,
8.875% Sr. Sub. Nts., 3/15/10 600,000 639,000
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Prime Hospitality Corp., 8.375%
Sr. Sub. Nts., 5/1/12 400,000 386,000
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Royal Caribbean Cruises Ltd.:
8% Sr. Unsec. Nts., 5/15/10 200,000 209,000
8.75% Sr. Unsub. Nts., 2/2/11 600,000 639,000
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Six Flags, Inc.:
8.875% Sr. Nts., 2/1/10 400,000 386,000
9.75% Sr. Nts., 4/15/13 3 1,500,000 1,492,500
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Starwood Hotels & Resorts
Worldwide, Inc., 7.875% Sr. Nts.,
5/1/12 1,500,000 1,650,000
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Sun International Hotels Ltd.,
8.875% Sr. Unsec. Sub. Nts., 8/15/11 1,000,000 1,087,500
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Trump Casino Holdings LLC/
Trump Casino Funding, Inc.,
11.625% Nts., 3/15/10 3 600,000 576,000
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Universal City Development
Partners, 11.75% Sr. Nts., 4/1/10 1 1,000,000 1,102,500
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Vail Resorts, Inc., 8.75% Sr. Unsec.
Sub. Nts., 5/15/09 1 700,000 735,000
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Venetian Casino Resort LLC/
Las Vegas Sands, Inc., 11% Sec.
Nts., 6/15/10 850,000 962,625
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Yum! Brands, Inc., 7.70% Sr. Nts.,
7/1/12 300,000 343,500
-------------
28,141,575
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Household Durables--2.1%
Beazer Homes USA, Inc., 8.375%
Sr. Nts., 4/15/12 500,000 556,250
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D.R. Horton, Inc., 9.75% Sr. Sub.
Nts., 9/15/10 300,000 342,750
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Del Webb Corp., 10.25% Sr.
Unsec. Sub. Debs., 2/15/10 600,000 657,000
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Interface, Inc., 10.375% Sr. Nts.,
2/1/10 500,000 482,500
Principal Market Value
Amount See Note 1
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Household Durables Continued
K. Hovnanian Enterprises, Inc.,
8.875% Sr. Sub. Nts., 4/1/12 $ 800,000 $ 878,000
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KB Home:
8.625% Sr. Sub. Nts., 12/15/08 150,000 171,000
9.50% Sr. Unsec. Sub. Nts., 2/15/11 350,000 397,688
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Meritage Corp., 9.75% Sr. Unsec.
Nts., 6/1/11 500,000 555,000
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Salton, Inc., 10.75% Sr. Unsec. Sub.
Nts., 12/15/05 500,000 505,000
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Standard Pacific Corp., 9.25% Sr.
Sub. Nts., 4/15/12 1 700,000 789,250
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Toll Corp., 8.25% Sr. Sub. Nts.,
12/1/11 500,000 562,500
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WCI Communities, Inc.:
9.125% Sr. Sub. Nts., 5/1/12 800,000 856,000
10.625% Sr. Unsec. Sub. Nts.,
2/15/11 600,000 666,000
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William Lyon Homes, Inc.,
10.75% Sr. Nts., 4/1/13 800,000 854,000
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Williams Scotsman, Inc., 9.875%
Sr. Unsec. Nts., 6/1/07 1,000,000 985,000
-------------
9,257,938
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Leisure Equipment & Products--0.2%
Remington Arms Co., Inc.,
10.50% Sr. Nts., 2/1/11 3 800,000 840,000
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Media--9.9%
Adelphia Communications Corp.:
7.875% Sr. Unsec. Nts., 5/1/09 4,5 360,000 219,600
8.125% Sr. Nts., Series B, 7/15/03 4,5 1,000,000 625,000
8.375% Sr. Nts., Series B, 2/1/08 4,5 1,000,000 625,000
10.25% Sr. Unsec. Nts., 11/1/06 4,5 200,000 123,000
10.875% Sr. Unsec. Nts., 10/1/10 4,5 1,000,000 625,000
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Allbritton Communications Co.,
7.75% Sr. Unsec. Sub. Nts., 12/15/12 700,000 726,250
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AMC Entertainment, Inc., 9.50%
Sr. Unsec. Sub. Nts., 2/1/11 1,200,000 1,248,000
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American Media, Inc., 8.875% Sr.
Sub. Nts., 1/15/11 3 600,000 652,500
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AOL Time Warner, Inc., 6.875%
Nts., 5/1/12 850,000 972,341
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Block Communications, Inc.,
9.25% Sr. Sub. Nts., 4/15/09 600,000 657,000
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British Sky Broadcasting Group
plc, 8.20% Sr. Unsec. Nts., 7/15/09 700,000 830,715
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CanWest Media, Inc., 7.625% Sr.
Nts., 4/15/13 3 300,000 320,250
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Carmike Cinemas, Inc., 10.375%
Gtd. Sr. Sub. Nts., Series B, 2/1/09 1,250,000 1,318,750
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CBD Media, Inc./CBD Finance,
8.625% Sr. Sub. Nts., 6/1/11 3 200,000 207,000
4 OPPENHEIMER HIGH INCOME FUND/VA
Principal Market Value
Amount See Note 1
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Media Continued
Charter Communications
Holdings LLC/Charter
Communications Holdings
Capital Corp.:
0%/9.92% Sr. Unsec. Disc. Nts.,
4/1/11 6 $ 2,500,000 $ 1,656,250
0%/11.75% Sr. Unsec. Sub. Disc.
Nts., 5/15/11 6 1,500,000 765,000
8.625% Sr. Unsec. Nts., 4/1/09 4,200,000 3,045,000
10% Sr. Nts., 4/1/09 500,000 385,000
11.125% Sr. Unsec. Nts., 1/15/11 600,000 468,000
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Cinemark USA, Inc., 9% Sr. Sub.
Nts., 2/1/13 800,000 872,000
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Classic Cable, Inc., 10.50% Sr. Sub.
Nts., 3/1/10 1,4,5 1,000,000 --
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Corus Entertainment, Inc., 8.75%
Sr. Sub. Nts., 3/1/12 800,000 864,000
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CSC Holdings, Inc., 7.625% Sr.
Unsec. Unsub. Nts., Series B, 4/1/11 3,400,000 3,451,000
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Diva Systems Corp., 12.625% Sr.
Unsec. Disc. Nts., Series B, 3/1/08 1,4,5 500,000 30,625
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EchoStar DBS Corp.:
9.125% Sr. Nts., 1/15/09 300,000 336,750
9.375% Sr. Unsec. Nts., 2/1/09 450,000 482,063
10.375% Sr. Unsec. Nts., 10/1/07 1,800,000 2,002,500
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Emmis Communications Corp.,
8.125% Sr. Unsec. Sub. Nts., Series B,
3/15/09 800,000 842,000
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Entravision Communications Corp.,
8.125% Sr. Sub. Nts., 3/15/09 600,000 627,000
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Garden State Newspapers, Inc.,
8.75% Sr. Sub. Nts., 10/1/09 500,000 518,750
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Gray Television, Inc., 9.25% Sr. Sub.
Nts., 12/15/11 500,000 555,000
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Hollinger International Publishing,
Inc., 9% Sr. Unsec. Nts., 12/15/10 600,000 645,000
- --------------------------------------------------------------------------------
Houghton Mifflin Co., 8.25% Sr.
Nts., 2/1/11 3 700,000 742,000
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Lamar Media Corp., 7.25% Sr.
Unsec. Sub. Nts., 1/1/13 200,000 213,000
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Liberty Media Corp., 7.875% Sr.
Nts., 7/15/09 1,750,000 2,053,051
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Lin Television Corp., 6.50% Sr.
Sub. Nts., 5/15/13 3 500,000 501,250
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LodgeNet Entertainment Corp.,
9.50% Sr. Sub. Debs., 6/15/13 400,000 412,000
- --------------------------------------------------------------------------------
Mediacom LLC/Mediacom
Capital Corp., 9.50% Sr. Unsec.
Nts., 1/15/13 300,000 318,750
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News America Holdings, Inc.,
8.875% Sr. Debs., 4/26/23 625,000 801,078
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Media Continued
PanAmSat Corp., 8.50% Sr. Unsec.
Nts., 2/1/12 $ 1,200,000 $ 1,305,000
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PRIMEDIA, Inc., 8% Sr. Nts., 5/15/13 3 1,700,000 1,751,000
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R.H. Donnelley Financial Corp. I:
8.875% Sr. Nts., 12/15/10 3 700,000 777,000
10.875% Sr. Sub. Nts., 12/15/12 3 1,000,000 1,170,000
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Radio One, Inc., 8.875% Sr. Unsec.
Sub. Nts., Series B, 7/1/11 300,000 331,500
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Regal Cinemas, Inc., 9.375% Sr.
Sub. Nts., Series B, 2/1/12 1,200,000 1,329,000
- --------------------------------------------------------------------------------
Rogers Communications, Inc.,
8.75% Sr. Nts., 7/15/07 [CAD] 500,000 379,945
- --------------------------------------------------------------------------------
Sinclair Broadcast Group, Inc.:
8% Sr. Sub. Nts., 3/15/12 900,000 965,250
8% Sr. Sub. Nts., 3/15/12 3 700,000 750,750
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Spanish Broadcasting System,
Inc., 9.625% Sr. Unsec. Sub. Nts.,
11/1/09 600,000 640,500
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United Pan-Europe Communications NV:
0%/13.375% Sr. Unsec. Disc.
Nts., Series B, 11/1/09 4,5,6 1,000,000 147,500
10.875% Sr. Unsec. Nts., Series B,
8/1/09 4,5 600,000 132,000
11.25% Sr. Nts., Series B,
11/1/09 1,4,5 [EUR] 500,000 111,246
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Vertis, Inc.:
9.75% Sr. Sec. Nts., 4/1/09 3 400,000 418,000
10.875% Sr. Unsec. Nts., Series B,
6/15/09 200,000 201,000
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Vivendi Universal SA, 9.25% Sr.
Nts., 4/15/10 3 800,000 914,000
- --------------------------------------------------------------------------------
WRC Media, Inc./Weekly
Reader Corp./Compass Learning
Corp., 12.75% Sr. Sub. Nts., 11/15/09 600,000 627,750
-------------
43,688,914
- --------------------------------------------------------------------------------
Multiline Retail--0.6%
J. C. Penney Co., Inc.:
7.60% Nts., 4/1/07 1,000,000 1,055,000
8% Nts., 3/1/10 800,000 842,000
- --------------------------------------------------------------------------------
Saks, Inc.:
8.25% Sr. Unsec. Nts., 11/15/08 250,000 265,625
9.875% Nts., 10/1/11 1 600,000 678,000
-------------
2,840,625
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Specialty Retail--1.8%
Asbury Automotive Group, Inc.,
9% Sr. Sub. Nts., 6/15/12 600,000 582,000
- --------------------------------------------------------------------------------
AutoNation, Inc., 9% Sr. Unsec.
Nts., 8/1/08 1,200,000 1,338,000
- --------------------------------------------------------------------------------
Building Materials Corp., 8% Sr.
Nts., 12/1/08 300,000 279,000
6 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Specialty Retail Continued
CSK Auto, Inc., 12% Sr. Unsec.
Nts., 6/15/06 $ 900,000 $ 1,003,500
- --------------------------------------------------------------------------------
Finlay Enterprises, Inc., 9% Debs.,
5/1/08 700,000 710,500
- --------------------------------------------------------------------------------
Finlay Fine Jewelry Corp., 8.375%
Sr. Nts., 5/1/08 1 600,000 624,000
- --------------------------------------------------------------------------------
Gap, Inc. (The):
6.90% Nts., 9/15/07 650,000 703,625
10.55% Unsub. Nts., 12/15/08 200,000 244,000
- --------------------------------------------------------------------------------
Hollywood Entertainment Corp.,
9.625% Sr. Sub. Nts., 3/15/11 800,000 879,000
- --------------------------------------------------------------------------------
Petco Animal Supplies, Inc.,
10.75% Sr. Sub. Nts., 11/1/11 1 750,000 858,750
- --------------------------------------------------------------------------------
Rent-A-Center, Inc., 7.50% Sr. Sub.
Nts., 5/1/10 3 350,000 369,250
- --------------------------------------------------------------------------------
United Auto Group, Inc., 9.625%
Sr. Unsec. Sub. Nts., 3/15/12 200,000 215,000
-------------
7,806,625
- --------------------------------------------------------------------------------
Textiles, Apparel & Luxury Goods--0.4%
Galey & Lord, Inc., 9.125% Sr.
Unsec. Sub. Nts., 3/1/08 1,4,5 700,000 7,875
- --------------------------------------------------------------------------------
Levi Strauss & Co.:
11.625% Sr. Unsec. Nts., 1/15/08 200,000 172,500
12.25% Sr. Nts., 12/15/12 400,000 335,000
- --------------------------------------------------------------------------------
Oxford Industries, Inc., 8.875%
Sr. Nts., 6/1/11 3 500,000 527,500
- --------------------------------------------------------------------------------
Phillips/Van Heusen Corp., 8.125%
Sr. Nts., 5/1/13 1 300,000 309,375
- --------------------------------------------------------------------------------
Russell Corp., 9.25% Sr. Nts., 5/1/10 1 600,000 657,000
-------------
2,009,250
- --------------------------------------------------------------------------------
Consumer Staples--4.2%
- --------------------------------------------------------------------------------
Beverages--0.3%
Constellation Brands, Inc., 8.125%
Sr. Sub. Nts., 1/15/12 500,000 542,500
- --------------------------------------------------------------------------------
Packaged Ice, Inc., 9.75% Sr. Unsec.
Nts., Series B, 2/1/05 800,000 812,000
-------------
1,354,500
- --------------------------------------------------------------------------------
Food & Staples Retailing--0.9%
Delhaize America, Inc., 8.125%
Unsub. Debs., 4/15/11 1,500,000 1,650,000
- --------------------------------------------------------------------------------
Fleming Cos., Inc., 10.125% Sr.
Unsec. Nts., 4/1/08 4,5 500,000 77,500
- --------------------------------------------------------------------------------
Great Atlantic & Pacific Tea Co.,
Inc. (The), 9.125% Sr. Nts., 12/15/11 400,000 376,000
- --------------------------------------------------------------------------------
Pantry, Inc. (The), 10.25% Sr. Sub.
Nts., 10/15/07 325,000 336,375
- --------------------------------------------------------------------------------
Real Time Data Co., 13% Disc.
Nts., 5/31/09 1,4,5,7 476,601 9,532
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Food & Staples Retailing Continued
Rite Aid Corp.:
8.125% Sr. Sec. Nts., 5/1/10 3 $ 900,000 $ 936,000
9.50% Sr. Sec. Nts., 2/15/11 3 450,000 486,000
-------------
3,871,407
- --------------------------------------------------------------------------------
Food Products--2.1%
American Seafood Group LLC,
10.125% Sr. Sub. Nts., 4/15/10 1 500,000 570,000
- --------------------------------------------------------------------------------
Aurora Foods, Inc., 8.75% Sr. Sub.
Nts., Series B, 7/1/08 4 500,000 178,750
- --------------------------------------------------------------------------------
Burns Philp Capital Pty Ltd.,
9.75% Sr. Sub. Nts., 7/15/12 3 400,000 392,000
- --------------------------------------------------------------------------------
Del Monte Corp.:
8.625% Sr. Sub. Nts., 12/15/123 1,000,000 1,065,000
9.25% Sr. Unsec. Sub. Nts., 5/15/11 100,000 107,500
- --------------------------------------------------------------------------------
Doane Pet Care Co., 10.75% Sr.
Nts., 3/1/10 800,000 876,000
- --------------------------------------------------------------------------------
Dole Food Co., Inc.:
8.625% Sr. Nts., 5/1/09 900,000 956,250
8.875% Sr. Nts., 3/15/11 3 400,000 426,000
- --------------------------------------------------------------------------------
Michael Foods, Inc., 11.75% Sr.
Unsec. Sub. Nts., 4/1/11 1 400,000 462,000
- --------------------------------------------------------------------------------
New World Pasta Co., 9.25% Sr.
Nts., 2/15/09 200,000 64,000
- --------------------------------------------------------------------------------
Smithfield Foods, Inc.:
7.625% Sr. Unsec. Sub. Nts., 2/15/08 925,000 955,063
8% Sr. Nts., Series B, 10/15/09 900,000 978,750
- --------------------------------------------------------------------------------
Swift & Co., 10.125% Sr. Nts.,
10/1/09 3 1,000,000 1,045,000
- --------------------------------------------------------------------------------
United Biscuits Finance plc,
10.625% Sr. Sub. Nts., 4/15/11 [EUR] 1,000,000 1,303,377
-------------
9,379,690
- --------------------------------------------------------------------------------
Household Products--0.8%
AKI, Inc., 10.50% Sr. Unsec. Nts.,
7/1/08 1 1,000,000 1,030,000
- --------------------------------------------------------------------------------
Armkel LLC/Armkel Finance, Inc.,
9.50% Sr. Sub. Nts., 8/15/09 600,000 672,000
- --------------------------------------------------------------------------------
Holmes Products Corp., 9.875% Sr.
Unsec. Sub. Nts., Series B, 11/15/07 1 300,000 269,250
- --------------------------------------------------------------------------------
Playtex Products, Inc., 9.375% Sr.
Unsec. Sub. Nts., 6/1/11 1,000,000 1,005,000
- --------------------------------------------------------------------------------
Revlon Consumer Products Corp.,
12% Sr. Sec. Nts., 12/1/05 400,000 391,000
- --------------------------------------------------------------------------------
Styling Technology Corp., 10.875%
Sr. Unsec. Sub. Nts., 7/1/08 1,4,5 600,000 --
-------------
3,367,250
- --------------------------------------------------------------------------------
Personal Products--0.1%
French Fragrances, Inc., 10.375%
Gtd. Sr. Unsec. Nts., Series D,
5/15/07 400,000 413,000
6 OPPENHEIMER HIGH INCOME FUND/VA
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Energy--6.0%
- --------------------------------------------------------------------------------
Energy Equipment & Services--1.6%
BRL Universal Equipment Corp.,
8.875% Sr. Sec. Nts., 2/15/08 $ 750,000 $ 817,500
- --------------------------------------------------------------------------------
Dresser, Inc., 9.375% Sr. Sub. Nts.,
4/15/11 400,000 414,000
- --------------------------------------------------------------------------------
Grant Geophysical, Inc., 9.75% Sr.
Unsec. Nts., Series B, 2/15/08 1,4,5 1,025,000 261,375
- --------------------------------------------------------------------------------
Grant Prideco Escrow Corp., 9%
Sr. Unsec. Nts., 12/15/09 300,000 334,500
- --------------------------------------------------------------------------------
Hanover Equipment Trust 2001A,
8.50% Sr. Sec. Nts., Series A, 9/1/08 500,000 527,500
- --------------------------------------------------------------------------------
Hornbeck-Leevac Marine Services,
Inc., 10.625% Sr. Nts., 8/1/08 1,750,000 1,938,125
- --------------------------------------------------------------------------------
Ocean Rig Norway AS, 10.25% Sr.
Sec. Nts., 6/1/08 1,600,000 1,338,000
- --------------------------------------------------------------------------------
Petroleum Helicopters, Inc., 9.375%
Sr. Nts., 5/1/09 600,000 675,750
- --------------------------------------------------------------------------------
Universal Compression, Inc., 7.25%
Sr. Nts., 5/15/10 3 800,000 832,000
-------------
7,138,750
- --------------------------------------------------------------------------------
Oil & Gas--4.4%
Belden & Blake Corp., 9.875% Sr.
Sub. Nts., 6/15/07 500,000 475,000
- --------------------------------------------------------------------------------
Chesapeake Energy Corp.:
8.125% Sr. Unsec. Nts., 4/1/11 1,000,000 1,082,500
8.375% Sr. Unsec. Nts., 11/1/08 1,000,000 1,087,500
9% Sr. Nts., 8/15/12 300,000 336,000
- --------------------------------------------------------------------------------
El Paso Energy Partners LP:
8.50% Sr. Sub. Nts., 6/1/10 3 500,000 537,500
8.50% Sr. Unsec. Sub. Nts.,
Series B, 6/1/11 700,000 752,500
10.625% Sr. Sub. Nts., 12/1/12 700,000 812,000
- --------------------------------------------------------------------------------
Forest Oil Corp., 7.75% Sr. Nts.,
5/1/14 1,000,000 1,045,000
- --------------------------------------------------------------------------------
Frontier Escrow Corp., 8% Sr. Nts.,
4/15/13 3 500,000 525,000
- --------------------------------------------------------------------------------
Frontier Oil Corp., 11.75% Sr. Nts.,
11/15/09 800,000 884,000
- --------------------------------------------------------------------------------
Leviathan Gas Pipeline Partners LP/
Leviathan Finance Corp., 10.375%
Sr. Unsec. Sub. Nts., Series B, 6/1/09 1 500,000 536,250
- --------------------------------------------------------------------------------
Newfield Exploration Co., 8.375%
Sr. Sub. Nts., 8/15/12 600,000 678,750
- --------------------------------------------------------------------------------
Pioneer Natural Resources Co.,
7.50% Sr. Nts., 4/15/12 1,000,000 1,147,488
- --------------------------------------------------------------------------------
Pogo Producing Co., 8.75% Sr. Sub.
Nts., Series B, 5/15/07 1 600,000 621,000
- --------------------------------------------------------------------------------
Premcor Refining Group, Inc.,
9.50% Sr. Nts., 2/1/13 1,300,000 1,443,000
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Oil & Gas Continued
Stone Energy Corp.:
8.25% Sr. Unsec. Sub. Nts., 12/15/11 $ 800,000 $ 848,000
8.75% Sr. Sub. Nts., 9/15/07 735,000 766,237
- --------------------------------------------------------------------------------
Teekay Shipping Corp., 8.875%
Sr. Nts., 7/15/11 575,000 633,219
- --------------------------------------------------------------------------------
Tesoro Petroleum Corp.:
8% Sr. Sec. Nts., 4/15/08 3 1,000,000 1,030,000
9.625% Sr. Sub. Nts., 4/1/12 1,500,000 1,380,000
- --------------------------------------------------------------------------------
Westport Resources Corp., 8.25%
Sr. Unsec. Sub. Nts., 11/1/11 1,400,000 1,540,000
- --------------------------------------------------------------------------------
XTO Energy, Inc., 7.50% Sr. Nts.,
4/15/12 1,000,000 1,140,000
-------------
19,300,944
- --------------------------------------------------------------------------------
Financials--2.5%
- --------------------------------------------------------------------------------
Capital Markets--0.1%
Decrane Aircraft Holdings, Inc.,
12% Sr. Unsec. Sub. Nts., Series B,
9/30/08 1,550,000 736,250
- --------------------------------------------------------------------------------
Commercial Banks--0.4%
Bank Plus Corp., 12% Sr. Nts.,
7/18/07 1 517,000 556,421
- --------------------------------------------------------------------------------
Local Financial Corp., 11% Sr. Nts.,
9/8/04 1 800,000 820,000
- --------------------------------------------------------------------------------
Western Financial Bank, 9.625%
Unsec. Sub. Debs., 5/15/12 400,000 434,000
-------------
1,810,421
- --------------------------------------------------------------------------------
Diversified Financial Services--0.5%
AmeriCredit Corp., 9.875% Sr.
Nts., 4/15/06 400,000 394,000
- --------------------------------------------------------------------------------
Berry Plastics Corp., 10.75% Sr.
Sub. Nts., 7/15/12 800,000 884,000
- --------------------------------------------------------------------------------
Finova Group, Inc. (The), 7.50%
Nts., 11/15/09 500,000 220,000
- --------------------------------------------------------------------------------
LaBranche & Co., Inc., 12% Sr.
Unsec. Sub. Nts., 3/2/07 600,000 687,000
-------------
2,185,000
- --------------------------------------------------------------------------------
Real Estate--1.5%
Capstar Hotel Co., 8.75% Sr. Sub.
Nts., 8/15/07 200,000 182,000
- --------------------------------------------------------------------------------
CB Richard Ellis Services, Inc.,
11.25% Sr. Unsec. Sub. Nts., 6/15/11 1 300,000 323,250
- --------------------------------------------------------------------------------
Corrections Corp. of America:
7.50% Sr. Nts., 5/1/11 500,000 525,000
9.875% Sr. Nts., 5/1/09 500,000 560,625
- --------------------------------------------------------------------------------
Felcor Lodging LP:
9% Sr. Nts., 6/1/11 780,000 789,750
10% Sr. Unsec. Nts., 9/15/08 200,000 207,500
- --------------------------------------------------------------------------------
Felcor Suites LP, 7.375% Sr. Nts.,
10/1/04 200,000 203,500
7 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Real Estate Continued
HMH Properties, Inc., 7.875% Sr.
Nts., Series B, 8/1/08 $ 1,750,000 $ 1,785,000
- --------------------------------------------------------------------------------
iStar Financial, Inc., 8.75% Sr. Unsec.
Nts., 8/15/08 250,000 273,750
- --------------------------------------------------------------------------------
MeriStar Hospitality Corp.,
9.125% Sr. Unsec. Nts., 1/15/11 400,000 394,000
- --------------------------------------------------------------------------------
Saul (B.F.) Real Estate Investment
Trust, 9.75% Sr. Sec. Nts., Series B,
4/1/08 1,300,000 1,306,500
-------------
6,550,875
- --------------------------------------------------------------------------------
Health Care--5.2%
- --------------------------------------------------------------------------------
Health Care Equipment & Supplies--0.8%
Alaris Medical, Inc., 7.25% Sr. Sub.
Nts., 7/1/11 250,000 254,375
- --------------------------------------------------------------------------------
Dade Behring Holdings, Inc.,
11.91% Sr. Unsec. Sub. Nts., 10/3/10 200,000 227,000
- --------------------------------------------------------------------------------
Fisher Scientific International, Inc.,
8.125% Sr. Sub. Nts., 5/1/12 900,000 967,500
- --------------------------------------------------------------------------------
HMP Equity Holdings Corp., Units
(each unit consists of $1,000 zero
coupon sr. sec. disc. nts., 15.43%,
5/15/08 and one warrant to purchase
2.8094 shares of Huntsman Corp.
common stock) 8,9 1,000,000 510,000
- --------------------------------------------------------------------------------
Kinetic Concepts, Inc., 9.625% Sr.
Unsec. Sub. Nts., Series B, 11/1/07 1 400,000 418,000
- --------------------------------------------------------------------------------
Sybron Dental Specialties, Inc.,
8.125% Sr. Sub. Nts., 6/15/12 700,000 742,000
- --------------------------------------------------------------------------------
Vanguard Health Systems, Inc.,
9.75% Sr. Unsec. Sub. Nts., 8/1/11 500,000 500,000
-------------
3,618,875
- --------------------------------------------------------------------------------
Health Care Providers & Services--4.4%
Alderwoods Group, Inc., 12.25%
Sr. Nts., 1/2/09 700,000 735,000
- --------------------------------------------------------------------------------
Alliance Imaging, Inc., 10.375% Sr.
Unsec. Sub. Nts., 4/15/11 400,000 420,000
- --------------------------------------------------------------------------------
AmeriPath, Inc., 10.50% Sr. Sub.
Nts., 4/1/13 3 700,000 754,250
- --------------------------------------------------------------------------------
AmerisourceBergen Corp., 7.25%
Sr. Unsec. Nts., 11/15/12 200,000 218,000
- --------------------------------------------------------------------------------
Beverly Enterprises, Inc., 9.625%
Sr. Unsec. Nts., 4/15/09 925,000 892,625
- --------------------------------------------------------------------------------
Extendicare Health Services, Inc.,
9.50% Sr. Unsec. Sub. Nts., 7/1/10 500,000 527,500
- --------------------------------------------------------------------------------
Fresenius Medical Care Capital
Trust II, 7.875% Nts., 2/1/08 1,600,000 1,688,000
- --------------------------------------------------------------------------------
Hanger Orthopedic Group, Inc.,
10.375% Sr. Nts., 2/15/09 400,000 444,000
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Health Care Providers & Services Continued
HCA, Inc.:
6.30% Sr. Unsec. Nts., 10/1/12 $ 300,000 $ 307,242
6.95% Sr. Nts., 5/1/12 1,000,000 1,067,438
7.875% Sr. Nts., 2/1/11 305,000 342,067
- --------------------------------------------------------------------------------
HCA-Healthcare Co. (The), 8.75%
Sr. Nts., 9/1/10 400,000 466,585
- --------------------------------------------------------------------------------
Healthsouth Corp., 7.625% Nts.,
6/1/12 4,5 1,250,000 975,000
- --------------------------------------------------------------------------------
InSight Health Services Corp.,
9.875% Sr. Sub. Nts., 11/1/11 500,000 527,500
- --------------------------------------------------------------------------------
Magellan Health Services, Inc.:
9% Sr. Sub. Nts., 2/15/08 4,5 300,000 130,500
9.375% Sr. Nts., 11/15/07 3 2,000,000 2,010,000
- --------------------------------------------------------------------------------
Medquest, Inc., 11.875% Sr. Unsec.
Sub. Nts., Series B, 8/15/12 700,000 731,500
- --------------------------------------------------------------------------------
NDCHealth Corp., 10.50% Sr. Sub.
Nts., 12/1/12 3 600,000 646,500
- --------------------------------------------------------------------------------
PacifiCare Health Systems, Inc.,
10.75% Sr. Unsec. Unsub. Nts.,
6/1/09 1,100,000 1,267,750
- --------------------------------------------------------------------------------
Rotech Healthcare, Inc., 9.50% Sr.
Unsec. Sub. Nts., 4/1/12 600,000 619,500
- --------------------------------------------------------------------------------
Select Medical Corp., 9.50% Sr.
Unsec. Sub. Nts., 6/15/09 200,000 218,250
- --------------------------------------------------------------------------------
Stewart Enterprises, Inc., 10.75%
Sr. Unsec. Sub. Nts., 7/1/08 1,800,000 2,016,000
- --------------------------------------------------------------------------------
Tenet Healthcare Corp., 6.375%
Sr. Nts., 12/1/11 760,000 706,800
- --------------------------------------------------------------------------------
US Oncology, Inc., 9.625% Sr.
Sub. Nts., 2/1/12 300,000 322,500
- --------------------------------------------------------------------------------
Vicar Operating, Inc., 9.875% Sr.
Sub. Nts., 12/1/09 1 1,000,000 1,100,000
-------------
19,134,507
- --------------------------------------------------------------------------------
Pharmaceuticals--0.0%
aaiPharma, Inc., 11% Sr. Sub.
Nts., 4/1/10 100,000 110,500
- --------------------------------------------------------------------------------
Industrials--9.7%
- --------------------------------------------------------------------------------
Aerospace & Defense--1.3%
Alliant Techsystems, Inc., 8.50% Sr.
Unsec. Sub. Nts., 5/15/11 900,000 1,003,500
- --------------------------------------------------------------------------------
American Plumbing & Mechanical,
Inc., 11.625% Sr. Sub. Nts., Series B,
10/15/08 500,000 167,500
- --------------------------------------------------------------------------------
K&F Industries, Inc., 9.625% Sr.
Unsec. Sub. Nts., 12/15/10 300,000 334,500
- --------------------------------------------------------------------------------
L-3 Communications Corp.,
7.625% Sr. Sub. Nts., 6/15/12 800,000 884,000
- --------------------------------------------------------------------------------
Rexnord Corp., 10.125% Sr. Sub.
Nts., 12/15/12 3 700,000 773,500
- --------------------------------------------------------------------------------
TransDigm, Inc., 10.375% Sr. Sub.
Nts., 12/1/08 400,000 435,572
8 OPPENHEIMER HIGH INCOME FUND/VA
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Aerospace & Defense Continued
TRW Automotive, Inc.:
9.375% Sr. Nts., 2/15/13 3 $ 650,000 $ 708,500
11% Sr. Sub. Nts., 2/15/13 3 700,000 766,500
- --------------------------------------------------------------------------------
Vought Aircraft Industries, Inc.,
8% Sr. Nts., 7/15/11 3 500,000 505,000
-------------
5,578,572
- --------------------------------------------------------------------------------
Air Freight & Logistics--0.0%
Atlas Air, Inc., 9.25% Sr. Nts.,
4/15/08 4,5 500,000 108,125
- --------------------------------------------------------------------------------
Airlines--0.4%
America West Airlines, Inc.,
10.75% Sr. Nts., 9/1/05 1 1,000,000 565,000
- --------------------------------------------------------------------------------
Amtran, Inc., 10.50% Sr. Nts., 8/1/04 1,500,000 1,087,500
-------------
1,652,500
- --------------------------------------------------------------------------------
Building Products--0.6%
Associated Materials, Inc., 9.75%
Sr. Sub. Nts., 4/15/12 700,000 767,375
- --------------------------------------------------------------------------------
Green Star Products, Inc., 10.15%
Bonds, 6/24/10 3 339,340 359,777
- --------------------------------------------------------------------------------
Jacuzzi Brands, Inc., 9.625% Sr. Sec.
Nts., 7/1/10 3,10 800,000 826,000
- --------------------------------------------------------------------------------
Nortek, Inc.:
9.125% Sr. Unsec. Nts., Series B,
9/1/07 1 200,000 210,000
9.875% Sr. Unsec. Sub. Nts., 6/15/11 1 400,000 423,000
-------------
2,586,152
- --------------------------------------------------------------------------------
Commercial Services & Supplies--3.3%
Allied Waste North America, Inc.:
7.875% Sr. Nts., 4/15/13 800,000 841,000
7.875% Sr. Unsec. Nts., Series B,
1/1/09 400,000 420,500
8.50% Sr. Sub. Nts., 12/1/08 1,000,000 1,080,000
8.875% Sr. Nts., Series B, 4/1/08 900,000 981,000
9.25% Sr. Nts., 9/1/12 3 2,800,000 3,101,000
10% Sr. Unsec. Sub. Nts., Series B,
8/1/09 400,000 427,000
- --------------------------------------------------------------------------------
American Color Graphics, Inc.,
10% Sr. Sec. Nts., 6/15/10 3,10 400,000 400,000
- --------------------------------------------------------------------------------
American Pad & Paper Co., 13%
Sr. Sub. Nts., Series B, 11/15/05 1,4,5 200,000 2,250
- --------------------------------------------------------------------------------
Budget Group, Inc., 9.125% Sr.
Unsec. Nts., 4/1/06 1,4,5 900,000 212,625
- --------------------------------------------------------------------------------
Buhrmann US, Inc., 12.25% Sr.
Unsec. Sub. Nts., 11/1/09 600,000 648,000
- --------------------------------------------------------------------------------
Coinmach Corp., 9% Sr. Nts., 2/1/10 800,000 860,000
- --------------------------------------------------------------------------------
Comforce Operating, Inc., 12%
Sr. Nts., Series B, 12/1/07 1 350,000 169,750
- --------------------------------------------------------------------------------
Hydrochem Industrial Services,
Inc., 10.375% Sr. Sub. Nts., 8/1/07 1 250,000 176,875
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Commercial Services & Supplies Continued
IT Group, Inc., 11.25% Sr. Unsec.
Sub. Nts., Series B, 4/1/09 1,4,5 $ 550,000 $ --
- --------------------------------------------------------------------------------
Kindercare Learning Centers, Inc.,
9.50% Sr. Sub. Nts., 2/15/09 750,000 759,375
- --------------------------------------------------------------------------------
Mail-Well I Corp., 9.625% Sr. Nts.,
3/15/12 700,000 740,250
- --------------------------------------------------------------------------------
Moore North American Finance,
Inc., 7.875% Sr. Nts., 1/15/11 3 400,000 419,000
- --------------------------------------------------------------------------------
Protection One, Inc./Protection
One Alarm Monitoring, Inc.,
7.375% Sr. Unsec. Nts., 8/15/05 900,000 742,500
- --------------------------------------------------------------------------------
Stericycle, Inc., 12.375% Sr. Unsec.
Sub. Nts., Series B, 11/15/09 488,000 563,640
- --------------------------------------------------------------------------------
Synagro Technologies, Inc., 9.50%
Sr. Sub. Nts., 4/1/09 700,000 752,500
- --------------------------------------------------------------------------------
United Rentals (North America), Inc.:
10.75% Sr. Nts., 4/15/08 3 400,000 439,000
10.75% Sr. Nts., 4/15/08 3 600,000 658,500
10.75% Sr. Unsec. Nts., 4/15/08 300,000 329,250
-------------
14,724,015
- --------------------------------------------------------------------------------
Construction & Engineering--0.1%
Integrated Electrical Services, Inc.:
9.375% Sr. Sub. Nts., Series B, 2/1/09 1 100,000 102,000
9.375% Sr. Sub. Nts., Series C, 2/1/09 100,000 102,000
- --------------------------------------------------------------------------------
URS Corp., 11.50% Sr. Unsec. Nts.,
9/15/09 1 300,000 321,000
-------------
525,000
- --------------------------------------------------------------------------------
Electrical Equipment--0.0%
Dayton Superior Corp., 13% Sr.
Unsec. Sub. Nts., 6/15/09 1 100,000 85,500
- --------------------------------------------------------------------------------
Industrial Conglomerates--1.3%
Great Lakes Dredge & Dock
Corp., 11.25% Sr. Unsec. Sub.
Nts., 8/15/08 1,715,000 1,826,475
- --------------------------------------------------------------------------------
Norse CBO Ltd., 9.342% Sub.
Bonds, Series 1A, Cl. C2, 8/13/10 1 1,500,000 577,500
- --------------------------------------------------------------------------------
Tyco International Group SA:
6.375% Nts., 10/15/11 2,900,000 3,074,000
6.75% Sr. Unsub. Nts., 2/15/11 100,000 106,500
-------------
5,584,475
- --------------------------------------------------------------------------------
Machinery--1.6%
Actuant Corp., 13% Sr. Sub. Nts.,
5/1/09 378,000 444,150
- --------------------------------------------------------------------------------
AGCO Corp., 9.50% Sr. Unsec.
Nts., 5/1/08 1,000,000 1,085,000
- --------------------------------------------------------------------------------
Blount, Inc., 13% Sr. Sub. Nts., 8/1/09 650,000 555,750
- --------------------------------------------------------------------------------
Eagle-Picher Industries, Inc.,
9.375% Sr. Unsec. Sub. Nts., 3/1/08 850,000 799,000
9 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Machinery Continued
Insilco Corp., 12% Sr. Sub. Nts.,
8/15/07 1,4,5 $ 1,200,000 $ 22,500
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The),
10.50% Sr. Sub. Nts., 8/1/12 800,000 892,000
- --------------------------------------------------------------------------------
NMHG Holding Co., 10% Sr.
Nts., 5/15/09 600,000 663,000
- --------------------------------------------------------------------------------
Roller Bearing Co. of America,
Inc., 9.625% Sr. Sub. Nts., Series B,
6/15/07 560,000 478,800
- --------------------------------------------------------------------------------
SPX Corp., 7.50% Sr. Nts., 1/1/13 900,000 978,750
- --------------------------------------------------------------------------------
Terex Corp.:
8.875% Sr. Unsec. Sub. Nts., 4/1/08 510,000 532,950
9.25% Sr. Unsec. Sub. Nts., 7/15/11 800,000 864,000
-------------
7,315,900
- --------------------------------------------------------------------------------
Marine--0.7%
CP Ships Ltd., 10.375% Sr. Nts.,
7/15/12 1,000,000 1,121,250
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc., 12%
Sr. Sec. Nts., 7/15/05 1,4,5 700,000 315,000
- --------------------------------------------------------------------------------
Navigator Gas Transport plc,
10.50% First Priority Ship Mtg.
Nts., 6/30/07 1,4,5 1,000,000 325,000
- --------------------------------------------------------------------------------
Pacific & Atlantic Holdings, Inc.,
10.50% Sec. Nts., 12/31/07 3 368,171 130,701
- --------------------------------------------------------------------------------
Sea Containers Ltd., 7.875% Sr.
Nts., 2/15/08 1,500,000 1,200,000
-------------
3,091,951
- --------------------------------------------------------------------------------
Road & Rail--0.3%
Kansas City Southern Railway
Co. (The), 7.50% Sr. Nts., 6/15/09 500,000 520,625
- --------------------------------------------------------------------------------
Stena AB, 9.625% Sr. Nts., 12/1/12 600,000 662,250
-------------
1,182,875
- --------------------------------------------------------------------------------
Transportation Infrastructure--0.1%
Worldspan LP/Worldspan Financial
Corp., 9.625% Sr. Nts., 6/15/11 3 350,000 362,250
- --------------------------------------------------------------------------------
Information Technology--2.6%
- --------------------------------------------------------------------------------
Communications Equipment--0.1%
Orion Network Systems, Inc.,
12.50% Sr. Disc. Nts., 1/15/07 4 1,150,000 398,475
- --------------------------------------------------------------------------------
Computers & Peripherals--0.2%
Seagate Technology Hdd Holdings,
8% Sr. Nts., 5/15/09 900,000 978,750
- --------------------------------------------------------------------------------
Electronic Equipment & Instruments--0.6%
Flextronics International Ltd.,
9.875% Sr. Unsec. Sub. Nts., 7/1/10 700,000 770,000
- --------------------------------------------------------------------------------
Ingram Micro, Inc., 9.875% Sr.
Unsec. Sub. Nts., 8/15/08 1 1,200,000 1,302,000
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Electronic Equipment & Instruments Continued
Xerox Capital plc (Europe),
5.875% Nts., 5/15/04 $ 400,000 $ 404,000
-------------
2,476,000
- --------------------------------------------------------------------------------
Internet Software & Services--0.0%
Exodus Communications, Inc.,
10.75% Sr. Nts., 12/15/09 1,4,5 [EUR] 866,302 44,767
- --------------------------------------------------------------------------------
FirstWorld Communications, Inc.,
0%/13% Sr. Disc. Nts., 4/15/08 1,4,5,6 500,000 50
- --------------------------------------------------------------------------------
Globix Corp., 11% Sr. Nts., 4/26/08 1 109,359 82,566
- --------------------------------------------------------------------------------
PSINet, Inc.:
10.50% Sr. Unsec. Nts.,
12/1/06 1,4,5 [EUR] 1,000,000 57,417
11% Sr. Nts., 8/1/09 4,5 919,282 63,201
-------------
248,001
- --------------------------------------------------------------------------------
IT Services--0.6%
Iron Mountain, Inc.:
7.75% Sr. Sub. Nts., 1/15/15 500,000 531,250
8.625% Sr. Unsec. Sub. Nts., 4/1/13 1,600,000 1,720,000
- --------------------------------------------------------------------------------
Titan Corp. (The), 8% Sr. Sub.
Nts., 5/15/11 3 400,000 426,000
-------------
2,677,250
- --------------------------------------------------------------------------------
Office Electronics--0.1%
ASAT Finance LLC, 12.50% Sr.
Unsec. Nts., 11/1/06 1 325,000 281,125
- --------------------------------------------------------------------------------
Xerox Corp., 7.15% Nts., 8/1/04 200,000 204,000
-------------
485,125
- --------------------------------------------------------------------------------
Semiconductors & Semiconductor Equipment--1.0%
AMI Semiconductor, Inc., 10.75%
Sr. Sub. Nts., 2/1/13 3 1,000,000 1,135,000
- --------------------------------------------------------------------------------
Amkor Technology, Inc.:
7.75% Sr. Nts., 5/15/13 3 800,000 764,000
9.25% Sr. Unsec. Sub. Nts., 2/15/08 1,000,000 1,045,000
- --------------------------------------------------------------------------------
ChipPAC International Co. Ltd.,
12.75% Sr. Unsec. Sub. Nts.,
Series B, 8/1/09 500,000 565,000
- --------------------------------------------------------------------------------
Fairchild Semiconductor Corp.,
10.375% Sr. Unsec. Nts., 10/1/07 850,000 898,348
-------------
4,407,348
- --------------------------------------------------------------------------------
Materials--11.0%
- --------------------------------------------------------------------------------
Chemicals--3.5%
Applied Extrusion Technologies, Inc.,
10.75% Sr. Nts., Series B, 7/1/11 450,000 333,000
- --------------------------------------------------------------------------------
ClimaChem, Inc., 10.75% Sr. Unsec.
Nts., Series B, 12/1/07 1 250,000 101,250
- --------------------------------------------------------------------------------
Compass Minerals Group, Inc.,
10% Sr. Sub. Nts., 8/15/11 1,200,000 1,350,000
10 OPPENHEIMER HIGH INCOME FUND/VA
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Chemicals Continued
Equistar Chemicals LP/
Equistar Funding Corp.:
8.75% Sr. Unsec. Nts., 2/15/09 $ 600,000 $ 585,000
10.625% Sr. Nts., 5/1/11 3 800,000 824,000
- --------------------------------------------------------------------------------
Huntsman Corp./
ICI Chemical Co. plc:
Zero Coupon Sr. Unsec. Disc. Nts.,
13.09%, 12/31/09 9 400,000 158,000
10.125% Sr. Unsec. Sub. Nts.,
7/1/09 [EUR] 100,000 105,935
10.125% Sr. Unsec. Sub. Nts., 7/1/09 1,800,000 1,737,000
- --------------------------------------------------------------------------------
Huntsman International LLC,
9.875% Sr. Nts., 3/1/09 1,800,000 1,881,000
- --------------------------------------------------------------------------------
IMC Global, Inc., 7.625% Bonds,
11/1/05 200,000 213,000
- --------------------------------------------------------------------------------
ISP Chemco, Inc., 10.25% Sr.
Unsec. Sub. Nts., 7/1/11 500,000 567,500
- --------------------------------------------------------------------------------
ISP Holdings, Inc., 10.625% Sr.
Sec. Nts., 12/15/09 300,000 320,250
- --------------------------------------------------------------------------------
Lyondell Chemical Co.:
9.50% Sec. Nts., 12/15/08 500,000 477,500
9.50% Sr. Sec. Debs., 12/15/083 100,000 95,500
9.625% Sr. Sec. Nts., Series A, 5/1/07 900,000 886,500
9.875% Sec. Nts., Series B, 5/1/07 2,100,000 2,068,500
10.875% Sr. Sub. Nts., 5/1/09 800,000 748,000
- --------------------------------------------------------------------------------
Millennium America, Inc., 9.25%
Sr. Nts., 6/15/08 3 800,000 864,000
- --------------------------------------------------------------------------------
Noveon, Inc., 11% Sr. Unsec. Sub.
Nts., Series B, 2/28/11 1 1,200,000 1,368,000
- --------------------------------------------------------------------------------
OM Group, Inc., 9.25% Sr. Sub.
Nts., 12/15/11 100,000 98,000
- --------------------------------------------------------------------------------
PCI Chemicals Canada, 10% Sr.
Sec. Nts., 12/31/08 319,909 279,121
- --------------------------------------------------------------------------------
Pioneer Cos., Inc., 4.60% Sr. Sec.
Nts., 12/31/06 2 101,304 86,615
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc.:
10% Sr. Sec. Nts., 12/19/07 1 383,491 356,167
11.25% Sr. Sub. Nts., 8/15/06 4,5 300,000 --
11.75% Sr. Unsec. Sub. Nts., 8/15/06 4,5 300,000 --
-------------
15,503,838
- --------------------------------------------------------------------------------
Construction Materials--0.2%
Texas Industries, Inc., 10.25% Sr.
Nts., 6/15/11 3 800,000 840,000
- --------------------------------------------------------------------------------
Containers & Packaging--3.6%
Ball Corp.:
6.875% Sr. Unsec. Nts., 12/15/12 3 300,000 319,500
7.75% Sr. Unsec. Nts., 8/1/06 700,000 770,000
8.25% Sr. Unsec. Sub. Nts., 8/1/08 800,000 844,000
- --------------------------------------------------------------------------------
Crown Euro Holdings SA,
9.50% Sr. Sec. Nts., 3/1/11 3 900,000 976,500
- --------------------------------------------------------------------------------
Graphic Packaging Corp.,
8.625% Sub. Nts., 2/15/12 1,000,000 1,025,000
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Containers & Packaging Continued
Jefferson Smurfit Corp., 8.25% Sr.
Unsec. Nts., 10/1/12 $ 800,000 $ 862,000
- --------------------------------------------------------------------------------
MDP Acquisitions plc, 9.625%
Sr. Nts., 10/1/12 800,000 888,000
- --------------------------------------------------------------------------------
Owens-Brockway Glass
Container, Inc.:
7.75% Sr. Sec. Nts., 5/15/11 3 1,000,000 1,062,500
8.25% Sr. Unsec. Nts., 5/15/13 3 500,000 525,000
8.75% Sr. Sec. Nts., 11/15/12 1,350,000 1,471,500
8.875% Sr. Sec. Nts., 2/15/09 1,300,000 1,417,000
- --------------------------------------------------------------------------------
Packaging Corp. of America,
9.625% Sr. Unsec. Sub. Nts., 4/1/09 500,000 553,125
- --------------------------------------------------------------------------------
Riverwood International Corp.:
10.625% Sr. Unsec. Nts., 8/1/07 500,000 521,250
10.875% Sr. Sub. Nts., 4/1/08 500,000 515,000
- --------------------------------------------------------------------------------
Stone Container Corp.:
8.375% Sr. Nts., 7/1/12 900,000 969,750
9.25% Sr. Unsec. Nts., 2/1/08 1,000,000 1,095,000
9.75% Sr. Unsec. Nts., 2/1/11 1,000,000 1,100,000
- --------------------------------------------------------------------------------
TriMas Corp., 9.875% Sr. Unsec.
Sub. Nts., 6/15/12 1,000,000 1,030,000
-------------
15,945,125
- --------------------------------------------------------------------------------
Metals & Mining--2.4%
AK Steel Corp.:
7.75% Sr. Unsec. Nts., 6/15/12 1,400,000 1,169,000
7.875% Sr. Unsec. Nts., 2/15/09 300,000 256,500
- --------------------------------------------------------------------------------
Arch Western Finance LLC,
6.75% Sr. Nts., 7/1/13 3 800,000 824,000
- --------------------------------------------------------------------------------
California Steel Industries Corp.,
8.50% Sr. Unsec. Nts., Series B,
4/1/09 300,000 306,000
- --------------------------------------------------------------------------------
Century Aluminum Co., 11.75%
Sr. Sec. Nts., 4/15/08 885,000 907,125
- --------------------------------------------------------------------------------
Great Lakes Carbon Corp., 10.25%
Sr. Sub. Nts., Series B, 5/15/08 579,000 495,045
- --------------------------------------------------------------------------------
IPSCO, Inc., 8.75% Sr. Nts., 6/1/13 3 300,000 307,500
- --------------------------------------------------------------------------------
Jorgensen (Earle M.) Co., 9.75%
Sr. Sec. Nts., 6/1/12 1 800,000 852,000
- --------------------------------------------------------------------------------
Kaiser Aluminum &
Chemical Corp.:
10.875% Sr. Nts., Series B,
10/15/06 1,4,5 1,000,000 785,000
12.75% Sr. Sub. Nts., 2/1/04 1,4,5 1,200,000 75,000
- --------------------------------------------------------------------------------
Metallurg, Inc., 11% Sr. Nts., 12/1/07 740,000 403,300
- --------------------------------------------------------------------------------
National Steel Corp., 9.875% First
Mtg. Bonds, Series D, 3/1/09 4,5 642,808 38,568
- --------------------------------------------------------------------------------
Northwest Pipeline Corp., 8.125%
Sr. Nts., 3/1/10 200,000 216,000
- --------------------------------------------------------------------------------
Oregon Steel Mills, Inc., 10% Sr.
Nts., 7/15/09 800,000 724,000
11 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Metals & Mining Continued
Peabody Energy Corp., 6.875% Sr.
Nts., 3/15/13 3 $ 1,000,000 $ 1,052,500
- --------------------------------------------------------------------------------
Steel Dynamics, Inc., 9.50% Sr.
Nts., 3/15/09 400,000 421,000
- --------------------------------------------------------------------------------
UCAR Finance, Inc., 10.25% Sr.
Nts., 2/15/12 400,000 394,000
- --------------------------------------------------------------------------------
United States Steel Corp.:
9.75% Sr. Nts., 5/15/10 800,000 816,000
10.75% Sr. Nts., 8/1/08 600,000 633,000
-------------
10,675,538
- --------------------------------------------------------------------------------
Paper & Forest Products--1.3%
Abitibi-Consolidated, Inc., 8.55%
Nts., 8/1/10 300,000 336,591
- --------------------------------------------------------------------------------
Ainsworth Lumber Co. Ltd.:
12.50% Sr. Nts., 7/15/07 7 400,000 454,000
13.875% Sr. Sec. Nts., 7/15/07 1 250,000 285,000
- --------------------------------------------------------------------------------
Doman Industries Ltd., 8.75% Sr.
Nts., 3/15/04 1,4,5 2,000,000 440,000
- --------------------------------------------------------------------------------
Georgia-Pacific Corp.:
8.125% Sr. Unsec. Nts., 5/15/11 1,200,000 1,239,000
9.375% Sr. Nts., 2/1/13 3 1,600,000 1,772,000
- --------------------------------------------------------------------------------
Louisiana-Pacific Corp., 10.875%
Sr. Sub. Nts., 11/15/08 1 250,000 286,250
- --------------------------------------------------------------------------------
Tembec Industries, Inc., 7.75% Sr.
Nts., 3/15/12 700,000 682,500
- --------------------------------------------------------------------------------
U.S. Timberlands Co. LP, 9.625%
Sr. Nts., 11/15/07 300,000 174,750
-------------
5,670,091
- --------------------------------------------------------------------------------
Telecommunication Services--8.4%
- --------------------------------------------------------------------------------
Diversified Telecommunication Services--3.0%
360networks, Inc.:
13% Sr. Unsec. Nts., 5/1/08 1,4,5 400,000 40
13% Sr. Unsec. Nts., 5/1/08 1,4,5 [EUR] 500,000 57
- --------------------------------------------------------------------------------
American Tower Corp., 9.375% Sr.
Nts., 2/1/09 550,000 555,500
- --------------------------------------------------------------------------------
COLO.com, Inc., 13.875% Sr. Nts.,
3/15/10 1,4,5 517,087 5,171
- --------------------------------------------------------------------------------
Concentric Network Corp.,
Escrow Shares, 12/15/07 4,5 800,000 --
- --------------------------------------------------------------------------------
Dex Media East LLC/Dex Media
East Finance Co., 9.875% Sr. Unsec.
Nts., 11/15/09 800,000 896,000
- --------------------------------------------------------------------------------
Diamond Holdings plc, 9.125%
Sr. Nts., 2/1/08 200,000 186,250
- --------------------------------------------------------------------------------
Focal Communications Corp.,
11.875% Sr. Unsec. Nts., Series B,
1/15/10 1,4,5 100,000 6,000
- --------------------------------------------------------------------------------
Intermedia Communications, Inc.,
0%/12.25% Sr. Disc. Nts., Series B,
3/1/09 4,5,6 200,000 64,000
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Diversified Telecommunication Services Continued
IPC Acquisition Corp., 11.50% Sr.
Sub. Nts., 12/15/09 $ 350,000 $ 372,750
- --------------------------------------------------------------------------------
Level 3 Communications, Inc.:
0%/10.50% Sr. Disc. Nts., 12/1/08 6 200,000 173,500
9.125% Sr. Unsec. Nts., 5/1/08 1,900,000 1,710,000
- --------------------------------------------------------------------------------
Metromedia Fiber Network, Inc.,
10% Sr. Unsec. Nts., Series B,
11/15/08 4,5 600,000 38,250
- --------------------------------------------------------------------------------
Nextlink Communications, Inc.:
Escrow Shares, 10/1/07 4,5 500,000 --
Escrow Shares, 11/15/08 4,5 200,000 --
Escrow Shares, 3/15/08 4,5 800,000 --
Escrow Shares, 6/1/09 4,5 500,000 --
- --------------------------------------------------------------------------------
NorthPoint Communications
Group, Inc., 12.875% Nts., 2/15/10 4,5 300,000 52,500
- --------------------------------------------------------------------------------
Qwest Capital Funding, Inc.:
5.875% Nts., 8/3/04 1,400,000 1,347,500
7.75% Nts., 8/15/06 500,000 467,500
- --------------------------------------------------------------------------------
Qwest Communications
International, Inc., 7.50% Sr. Unsec.
Nts., Series B, 11/1/08 900,000 837,000
- --------------------------------------------------------------------------------
Qwest Corp.:
7.20% Unsec. Nts., 11/1/04 400,000 412,000
8.875% Nts., 3/15/12 3 1,600,000 1,796,000
- --------------------------------------------------------------------------------
Qwest Services Corp., 13.50%
Nts., 12/15/10 3 1,000,000 1,135,000
- --------------------------------------------------------------------------------
Sprint Capital Corp., 8.375%
Nts., 3/15/12 1,050,000 1,259,600
- --------------------------------------------------------------------------------
Telewest Communications plc:
0%/9.25% Sr. Disc. Nts., 4/15/09 4,5,6 1,000,000 317,500
0%/9.875% Sr. Disc. Nts.,
4/15/09 1,4,5,6 [GBP] 500,000 253,711
11.25% Sr. Nts., 11/1/08 4,5 800,000 294,000
- --------------------------------------------------------------------------------
Teligent, Inc., 11.50% Sr. Nts.,
12/1/07 1,4,5 400,000 --
- --------------------------------------------------------------------------------
Time Warner Telecom LLC/
Time Warner Telecom, Inc.,
9.75% Sr. Nts., 7/15/08 1,100,000 1,067,000
- --------------------------------------------------------------------------------
Time Warner Telecom, Inc.,
10.125% Sr. Unsec. Sub. Nts., 2/1/11 200,000 194,000
- --------------------------------------------------------------------------------
Viatel, Inc., 11.25% Sr. Sec. Nts.,
4/15/08 1,4,5 600,000 --
- --------------------------------------------------------------------------------
Winstar Communications, Inc.,
12.75% Sr. Nts., 4/15/10 1,4,5 1,000,000 100
-------------
13,440,929
- --------------------------------------------------------------------------------
Wireless Telecommunication Services--5.4%
Alamosa Delaware, Inc., 12.50%
Sr. Unsec. Nts., 2/1/11 1,000,000 825,000
- --------------------------------------------------------------------------------
American Cellular Corp., 9.50%
Sr. Sub. Nts., 10/15/09 4 800,000 404,000
12 OPPENHEIMER HIGH INCOME FUND/VA
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Wireless Telecommunication Services Continued
American Tower Escrow Corp., Zero
Coupon Sr. Sub. Disc. Nts., 12.25%,
8/1/08 9 $ 1,400,000 $ 910,000
- --------------------------------------------------------------------------------
CellNet Data Systems, Inc., 14% Sr.
Unsec. Disc. Nts., 10/1/07 1,4,5 1,834,000 --
- --------------------------------------------------------------------------------
Centennial Cellular Operating Co./
Centennial Communications Corp.,
10.125% Sr. Nts., 6/15/13 3 1,200,000 1,194,000
- --------------------------------------------------------------------------------
Crown Castle International Corp.:
0%/10.375% Sr. Disc. Nts., 5/15/11 6 1,400,000 1,344,000
10.625% Sr. Unsec. Disc. Nts.,
11/15/07 940,000 994,050
10.75% Sr. Nts., 8/1/11 1,350,000 1,478,250
- --------------------------------------------------------------------------------
CTI Holdings SA, 0%/11.50% Sr.
Deferred Coupon Nts., 4/15/08 1,4,5,6 1,000,000 115,000
- --------------------------------------------------------------------------------
Dobson Communications Corp.,
10.875% Sr. Unsec. Nts., 7/1/10 500,000 542,500
- --------------------------------------------------------------------------------
IPCS, Inc., 0%/14% Sr. Unsec. Disc.
Nts., 7/15/10 1,4,5,6 350,000 19,250
- --------------------------------------------------------------------------------
Leap Wireless International, Inc.:
0%/14.50% Sr. Unsec. Disc. Nts.,
4/15/10 1,4,5,6 400,000 38,000
12.50% Sr. Nts., 4/15/10 1,4 400,000 54,000
- --------------------------------------------------------------------------------
Nextel Communications, Inc.:
9.375% Sr. Unsec. Nts., 11/15/09 4,550,000 4,908,312
10.65% Sr. Disc. Nts., 9/15/07 500,000 518,750
12% Sr. Unsec. Nts., 11/1/08 250,000 270,000
- --------------------------------------------------------------------------------
Nextel Partners, Inc.:
8.125% Sr. Nts., 7/1/11 3 300,000 300,750
11% Sr. Nts., 3/15/10 300,000 325,500
12.50% Sr. Nts., 11/15/09 1,700,000 1,921,000
- --------------------------------------------------------------------------------
Omnipoint Corp., 11.50% Sr.
Nts., 9/15/09 3 1,500,000 1,760,625
- --------------------------------------------------------------------------------
Orbcomm Global LP, Escrow
Shares, 8/15/04 4,5 600,000 --
- --------------------------------------------------------------------------------
Rural Cellular Corp.:
9.625% Sr. Sub. Nts., Series B, 5/15/08 950,000 845,500
9.75% Sr. Sub. Nts., 1/15/10 500,000 445,000
- --------------------------------------------------------------------------------
SBA Communications Corp.:
10.25% Sr. Unsec. Nts., 2/1/09 200,000 185,000
12% Sr. Unsec. Disc. Nts., 3/1/08 1,850,000 1,900,875
- --------------------------------------------------------------------------------
SpectraSite, Inc., 8.25% Sr. Nts.,
5/15/10 3 400,000 418,000
- --------------------------------------------------------------------------------
Triton PCS, Inc.:
8.50% Sr. Nts., 6/1/13 3 800,000 864,000
8.75% Sr. Unsec. Sub. Nts., 11/15/11 300,000 300,750
9.375% Sr. Unsec. Sub. Nts., 2/1/11 500,000 513,750
- --------------------------------------------------------------------------------
US Unwired, Inc., 0%/13.375% Sr.
Unsec. Sub. Disc. Nts., Series B, 11/1/09 6 800,000 332,000
-------------
23,727,862
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Utilities--9.8%
- --------------------------------------------------------------------------------
Electric Utilities--4.4%
AES Corp. (The):
8.75% Sr. Sec. Nts., 5/15/13 3 $ 2,200,000 $ 2,299,000
8.75% Sr. Unsec. Unsub. Nts., 6/15/08 451,000 448,745
8.875% Sr. Unsec. Nts., 2/15/11 144,000 141,480
9.375% Sr. Unsec. Nts., 9/15/10 252,000 254,520
9.50% Sr. Unsec. Nts., 6/1/09 58,000 58,870
10% Sec. Nts., 7/15/05 3 600,000 625,500
10.25% Sr. Unsec. Sub. Nts., 7/15/06 800,000 796,000
- --------------------------------------------------------------------------------
AES Drax Holdings Ltd., 10.41%
Sr. Sec. Sub. Nts., Series B, 12/31/20 1 300,000 195,000
- --------------------------------------------------------------------------------
Allegheny Energy, Inc., 7.75% Nts.,
8/1/05 300,000 301,500
- --------------------------------------------------------------------------------
Caithness Coso Funding Corp.,
9.05% Sr. Sec. Nts., Series B, 12/15/09 445,792 476,997
- --------------------------------------------------------------------------------
Calpine Corp.:
8.25% Sr. Unsec. Nts., 8/15/05 400,000 374,000
8.50% Sr. Unsec. Nts., 2/15/11 4,100,000 3,095,500
8.625% Sr. Nts., 8/15/10 200,000 151,000
8.75% Sr. Nts., 7/15/07 400,000 329,000
- --------------------------------------------------------------------------------
CMS Energy Corp.:
7.50% Sr. Nts., 1/15/09 300,000 298,125
9.875% Sr. Unsec. Nts., 10/15/07 1,400,000 1,499,750
- --------------------------------------------------------------------------------
CMS Energy X-TRAS Pass-Through
Trust I, 7% Sr. Unsec. Pass-Through
Certificates, 1/15/05 500,000 494,375
- --------------------------------------------------------------------------------
CMS Panhandle Holding Co.:
6.125% Sr. Nts., 3/15/04 1,325,000 1,359,781
7% Sr. Nts., 7/15/29 985,000 1,041,638
- --------------------------------------------------------------------------------
Edison Mission Energy, 10% Sr.
Unsec. Nts., 8/15/08 200,000 190,000
- --------------------------------------------------------------------------------
ESI Tractebel Acquisition Corp.,
7.99% Sec. Bonds, Series B,
12/30/11 1 942,000 947,888
- --------------------------------------------------------------------------------
FirstEnergy Corp., 7.375% Sr.
Unsub. Nts., Series C, 11/15/31 1,000,000 1,124,294
- --------------------------------------------------------------------------------
Mirant Americas Generation
LLC, 8.30% Sr. Unsec. Nts., 5/1/11 4 200,000 125,000
- --------------------------------------------------------------------------------
MSW Energy Holdings LLC/
MSW Energy Finance Co., Inc.,
8.50% Sr. Sec. Nts., 9/1/10 3 400,000 413,000
- --------------------------------------------------------------------------------
Panhandle Eastern Pipe Line
Co., 8.25% Sr. Nts., Series B, 4/1/10 200,000 239,000
- --------------------------------------------------------------------------------
PG&E Corp., 6.875% Sr. Sec. Nts.,
7/15/08 3 800,000 832,000
- --------------------------------------------------------------------------------
Reliant Resources, Inc.:
9.25% Sr. Sec. Nts., 7/15/10 3 600,000 603,750
9.50% Sr. Sec. Nts., 7/15/13 3 600,000 606,000
-------------
19,321,713
13 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Gas Utilities--2.8%
AmeriGas Partners LP/AmeriGas
Eagle Finance Corp., 8.875% Sr.
Unsec. Nts., Series B, 5/20/11 11 $ 1,400,000 $ 1,533,000
- --------------------------------------------------------------------------------
ANR Pipeline, Inc., 8.875% Sr.
Nts., 3/15/10 3 400,000 439,000
- --------------------------------------------------------------------------------
El Paso Corp., 7.875% Nts., 6/15/12 3 1,200,000 1,117,500
- --------------------------------------------------------------------------------
El Paso Energy Corp., 7.625% Nts.,
7/15/11 800,000 732,000
- --------------------------------------------------------------------------------
SEMCO Energy, Inc.:
7.125% Sr. Nts., 5/15/08 3 400,000 420,000
7.75% Sr. Nts., 5/15/13 3 400,000 428,000
- --------------------------------------------------------------------------------
Southern Natural Gas Co.:
7.35% Nts., 2/15/31 600,000 613,500
8% Sr. Unsub. Nts., 3/1/32 900,000 977,625
8.875% Sr. Nts., 3/15/10 3 700,000 766,500
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co., 7.50%
Bonds, 4/1/17 2,365,000 2,441,862
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The), 7.125%
Nts., 9/1/11 2,850,000 2,793,000
-------------
12,261,987
- --------------------------------------------------------------------------------
Multi-Utilities & Unregulated Power--2.5%
AES Red Oak LLC, 8.54% Sr. Sec.
Bonds, Series A, 11/30/19 1,083,539 1,135,007
- --------------------------------------------------------------------------------
Aquila, Inc., 7% Sr. Unsec. Nts.,
7/15/04 300,000 285,375
- --------------------------------------------------------------------------------
Consumers Energy Co.:
6.25% Nts., 9/15/06 300,000 333,317
6.375% Sr. Sec. Nts., 2/1/08 450,000 503,161
7.375% Nts., 9/15/23 350,000 365,686
- --------------------------------------------------------------------------------
Dynegy Holdings, Inc.:
6.875% Sr. Unsec. Unsub. Nts.,
4/1/11 3,540,000 2,991,300
8.125% Sr. Unsec. Unsub. Nts.,
3/15/05 300,000 293,250
8.75% Sr. Nts., 2/15/12 600,000 561,000
- --------------------------------------------------------------------------------
El Paso Production Holding Co.,
7.75% Sr. Nts., 6/1/13 3 1,100,000 1,102,750
- --------------------------------------------------------------------------------
Mirant Mid-Atlantic LLC, 8.625%
Sec. Pass-Through Certificates,
Series A, 6/30/12 868,851 835,915
- --------------------------------------------------------------------------------
Transcontinental Gas Pipe
Line Corp.:
6.125% Nts., 1/15/05 200,000 201,000
8.875% Sr. Unsub. Nts., Series B,
7/15/12 200,000 227,000
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The):
8.625% Sr. Nts., 6/1/10 800,000 840,000
9.25% Sr. Unsec. Unsub. Nts.,
3/15/04 1,200,000 1,236,000
- --------------------------------------------------------------------------------
Williams Holdings of Delaware, Inc.,
6.50% Nts., 12/1/08 300,000 294,000
-------------
11,204,761
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Water Utilities--0.1%
National Waterworks, Inc., 10.50%
Sr. Unsec. Sub. Nts., Series B,
12/1/12 1 $ 300,000 $ 333,375
-------------
Total Corporate Bonds and Notes
(Cost $364,412,705) 367,795,046
Shares
- --------------------------------------------------------------------------------
Preferred Stocks--0.7%
- --------------------------------------------------------------------------------
AmeriKing, Inc., 13% Cum. Sr.
Exchangeable, Non-Vtg. 1,7 13,764 138
- --------------------------------------------------------------------------------
Dobson Communications Corp.,
12.25% Sr. Exchangeable, Non-Vtg. 7 1 992
- --------------------------------------------------------------------------------
e.spire Communications, Inc., 12.75%
Jr. Redeemable, Non-Vtg. 1,5,7 498 50
- --------------------------------------------------------------------------------
Eagle-Picher Holdings, Inc., 11.75%
Cum. Exchangeable, Series B,
Non-Vtg. 1,5 8,000 354,000
- --------------------------------------------------------------------------------
Global Crossing Holdings Ltd.,
10.50% Sr. Exchangeable, Non-Vtg. 1,5,7 7,893 --
- --------------------------------------------------------------------------------
ICG Holdings, Inc., 14.25%
Exchangeable, Non-Vtg. 1,5,7 342 3
- --------------------------------------------------------------------------------
McLeodUSA, Inc., 2.50% Cv.,
Series A 5 3,258 23,588
- --------------------------------------------------------------------------------
Nebco Evans Holdings, Inc., 11.25%
Sr. Redeemable Exchangeable,
Non-Vtg. 1,7 7,274 --
- --------------------------------------------------------------------------------
Nextel Communications, Inc., 13%
Cum., Series D, Non-Vtg. 7 2 213
- --------------------------------------------------------------------------------
NTL Europe, Inc., 10% Nts., Series A,
Non-Vtg. 1,5 24 48
- --------------------------------------------------------------------------------
Pacific & Atlantic Holdings, Inc.,
7.50% Cum. Cv., Series A 1,7 18,905 37,810
- --------------------------------------------------------------------------------
Paxson Communications Corp.,
13.25% Cum. Jr. Exchangeable,
Non-Vtg. 7 75 740,625
- --------------------------------------------------------------------------------
Rural Cellular Corp., 11.375% Cum.,
Series B, Non-Vtg. 7 1,178 745,085
- --------------------------------------------------------------------------------
Sovereign Real Estate Investment
Trust, 12% Non-Cum., Series A 1 10,000 1,452,500
- --------------------------------------------------------------------------------
XO Communications, Inc., 13.50%
Sr., Series E, Non-Vtg. 7 1 --
-------------
Total Preferred Stocks (Cost $5,642,482) 3,355,052
- --------------------------------------------------------------------------------
Common Stocks--0.6%
- --------------------------------------------------------------------------------
Charles River Laboratories
International, Inc. 5 8,360 269,025
- --------------------------------------------------------------------------------
Chesapeake Energy Corp. 100,909 1,019,181
- --------------------------------------------------------------------------------
Covad Communications Group, Inc. 5 20,660 20,867
- --------------------------------------------------------------------------------
Equinix, Inc. 5 16,431 128,983
- --------------------------------------------------------------------------------
Geotek Communications, Inc. 1,5 226 --
- --------------------------------------------------------------------------------
Globix Corp. 1,5 11,467 31,534
- --------------------------------------------------------------------------------
14 OPPENHEIMER HIGH INCOME FUND/VA
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
Common Stocks Continued
- --------------------------------------------------------------------------------
Gulfstream Holding, Inc. 1,5 56 $ --
- --------------------------------------------------------------------------------
ICO Global Communication
Holdings Ltd. 1,5 42,107 35,791
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The) 1,039 23,170
- --------------------------------------------------------------------------------
Microcell Telecommunications, Inc. 5 1,861 15,922
- --------------------------------------------------------------------------------
Microcell Telecommunications,
Inc., Cl. A 5 15 130
- --------------------------------------------------------------------------------
Microcell Telecommunications,
Inc., Cl. B 5 1,850 14,466
- --------------------------------------------------------------------------------
NTL, Inc. 5 18,902 644,936
- --------------------------------------------------------------------------------
Orbital Sciences Corp. 5 1,370 10,001
- --------------------------------------------------------------------------------
Pioneer Cos., Inc. 5 20,688 75,511
- --------------------------------------------------------------------------------
Polymer Group, Inc., Cl. A 1,5 20,634 136,700
- --------------------------------------------------------------------------------
Prandium, Inc. 5 62,829 35,184
- --------------------------------------------------------------------------------
Southern Pacific Funding Corp.,
Liquidating Trust 1 251,604 --
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. 5 375 6,375
- --------------------------------------------------------------------------------
TVMAX Holdings, Inc. 1,5 7,500 15,937
- --------------------------------------------------------------------------------
Viatel Holding Ltd. (Bermuda) 1,5 2,349 1,175
- --------------------------------------------------------------------------------
WRC Media Corp. 1,5 1,353 27
- --------------------------------------------------------------------------------
XO Communications, Inc. 5 2,646 19,184
-------------
Total Common Stocks (Cost $4,110,610) 2,504,099
Units
- --------------------------------------------------------------------------------
Rights, Warrants and Certificates--0.1%
- --------------------------------------------------------------------------------
American Tower Corp. Wts.,
Exp. 8/1/08 1,5 1,400 144,200
- --------------------------------------------------------------------------------
ASAT Finance LLC Wts., Exp.
11/1/06 1,5 500 875
- --------------------------------------------------------------------------------
Chesapeake Energy Corp. Wts.,
Exp. 9/1/04 5 2,671 602
- --------------------------------------------------------------------------------
Citigroup, Inc. Wts., Exp. 12/31/50
(Litigation Wts.) 5 15,626 15,939
- --------------------------------------------------------------------------------
COLO.com, Inc. Wts., Exp. 3/15/10 1,5 600 6
- --------------------------------------------------------------------------------
Concentric Network Corp. Wts.,
Exp. 12/15/07 1,5 750 8
- --------------------------------------------------------------------------------
Covergent Communications, Inc.
Wts., Exp. 4/1/08 1,5 2,000 20
- --------------------------------------------------------------------------------
Decrane Aircraft Holdings, Inc.
Wts., Exp. 9/30/08 1,5 1,750 --
- --------------------------------------------------------------------------------
Diva Systems Corp. Wts., Exp.
3/1/08 1,5 1,500 15
- --------------------------------------------------------------------------------
e.spire Communications, Inc. Wts.,
Exp. 11/1/05 1,5 475 5
- --------------------------------------------------------------------------------
Horizon PCS, Inc. Wts., Exp.
10/1/10 1,5 1,300 65
- --------------------------------------------------------------------------------
ICG Communications, Inc. Wts.,
Exp. 9/15/05 1,5 5,940 59
- --------------------------------------------------------------------------------
Market Value
Units See Note 1
- --------------------------------------------------------------------------------
Rights, Warrants and Certificates Continued
ICO Global Communication
Holdings Ltd. Wts.:
Exp. 5/16/06 1,5 10,561 $ 53
Exp. 5/16/06 1,5 16 --
- --------------------------------------------------------------------------------
Imperial Credit Industries, Inc.
Wts., Exp. 1/31/08 1,5 5,148 --
- --------------------------------------------------------------------------------
Insilco Corp. Wts., Exp. 8/15/07 1,5 765 --
- --------------------------------------------------------------------------------
IPCS, Inc. Wts., Exp. 6/15/10 1,5 750 8
- --------------------------------------------------------------------------------
Leap Wireless International, Inc.
Wts., Exp. 4/15/10 1,5 550 --
- --------------------------------------------------------------------------------
Long Distance International, Inc.
Wts., Exp. 4/13/08 1,5 800 --
- --------------------------------------------------------------------------------
Loral Space & Communications
Ltd. Wts., Exp. 1/15/07 1,5 800 8
- --------------------------------------------------------------------------------
McLeodUSA, Inc. Wts., Exp.
4/16/07 1,5 7,220 3,032
- --------------------------------------------------------------------------------
Microcell Telecommunications, Inc.:
Cl. A Wts., Exp. 5/1/05 5 687 233
Cl. B Wts., Exp. 5/1/08 5 1,145 674
- --------------------------------------------------------------------------------
Millenium Seacarriers, Inc. Wts.,
Exp. 7/15/05 1,5 1,500 15
- --------------------------------------------------------------------------------
Ntelos, Inc. Wts., Exp. 8/15/10 1,5 1,000 1,500
- --------------------------------------------------------------------------------
Pathmark Stores, Inc. Wts.,
Exp. 9/19/10 5 20,000 27,600
- --------------------------------------------------------------------------------
Protection One, Inc. Wts.:
Exp. 11/1/03 1,5 28,000 --
Exp. 6/30/05 1,5 1,600 --
- --------------------------------------------------------------------------------
Real Time Data Co. Wts., Exp.
5/31/04 1,5 121,440 --
- --------------------------------------------------------------------------------
Republic Technologies International
LLC Wts., Exp. 7/15/09 1,5 500 5
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. Wts.,
Exp. 12/19/08 5 610 --
- --------------------------------------------------------------------------------
Telergy, Inc. Wts., Exp. 9/25/10 1,5 2,019 --
- --------------------------------------------------------------------------------
Telus Corp. Wts., Exp. 9/15/05 5 1,079 7,615
- --------------------------------------------------------------------------------
Transocean, Inc. Wts., Exp. 5/1/09 3 1,000 56,475
- --------------------------------------------------------------------------------
XO Communications, Inc.:
Cl. A Wts., Exp. 1/16/10 5 5,300 17,490
Cl. B Wts., Exp. 1/16/10 5 3,975 6,360
Cl. C Wts., Exp. 1/16/10 5 3,975 2,185
-------------
Total Rights, Warrants and Certificates
(Cost $262,416) 285,047
15 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
Principal Market Value
Amount See Note 1
- --------------------------------------------------------------------------------
Structured Notes--5.9%
JPMorgan Chase Bank:
High Beta High Yield Index Nts.,
10%, 6/20/08 $ 2,000,000 $ 2,025,000
High Yield Index-B Nts., 9%,
6/20/08 22,900,000 23,987,750
-------------
Total Structured Notes
(Cost $25,836,997) 26,012,750
- --------------------------------------------------------------------------------
Joint Repurchase Agreements--12.7% 12
Undivided interest of 12.72% in joint repurchase
agreement (Principal Amount/Market Value
$440,796,000, with a maturity value of $440,808,979)
with Banc One Capital Markets, Inc., 1.06%, dated
6/30/03, to be repurchased at $56,086,651 on 7/1/03,
collateralized by U.S. Treasury Bonds, 3.375%,
4/30/04, with a value of $449,915,616
(Cost $56,085,000) 56,085,000 56,085,000
- --------------------------------------------------------------------------------
Total Investments, at Value
(Cost $465,270,544) 105.1% 464,589,217
- --------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (5.1) (22,610,722)
---------------------------
Net Assets 100.0% $441,978,495
===========================
Footnotes to Statement of Investments
Principal amount is reported in U.S. Dollars, except for those denoted in the
following currencies:
CAD Canadian Dollar
EUR Euro
GBP British Pound Sterling
1. Identifies issues considered to be illiquid or restricted--See Note 7 of
Notes to Financial Statements.
2. Represents the current interest rate for a variable or increasing rate
security.
3. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $67,138,783 or 15.19% of the Fund's net
assets as of June 30, 2003.
4. Issuer is in default. See Note 1 of Notes to Financial Statements.
5. Non-income producing security.
6. Denotes a step bond: a zero coupon bond that converts to a fixed or variable
interest rate at a designated future date.
7. Interest or dividend is paid-in-kind.
8. Units may be comprised of several components, such as debt and equity and/or
warrants to purchase equity at some point in the future. For units, which
represent debt securities, principal amount disclosed represents total
underlying principal.
9. Zero coupon bond reflects effective yield on the date of purchase.
10. When-issued security to be delivered and settled after June 30, 2003. See
Note 1 of Notes to Financial Statements.
11. Securities with an aggregate market value of $240,900 are held in
collateralized accounts to cover initial margin requirements on open futures
sales contracts. See Note 6 of Notes to Financial Statements.
12. The Fund may have elements of risk due to concentrated investments. Such
concentrations may subject the Fund to additional risks.
See accompanying Notes to Financial Statements.
16 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES Unaudited
- --------------------------------------------------------------------------------
June 30, 2003
- --------------------------------------------------------------------------------------------------------------------------
Assets
Investments, at value (including cost and market value of $56,085,000 in repurchase agreements)
(cost $465,270,544)--see accompanying statement $ 464,589,217
- --------------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Interest, dividends and principal paydowns 8,142,591
Shares of beneficial interest sold 486,856
Investments sold (including $408,000 sold on a when-issued basis) 437,250
Daily variation on futures contracts 1,969
Other 2,484
--------------
Total assets 473,660,367
- --------------------------------------------------------------------------------------------------------------------------
Liabilities
Bank overdraft 23,697,285
- --------------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased (including $1,200,000 purchased on a when-issued basis) 4,829,151
Shares of beneficial interest redeemed 3,084,707
Service plan fees 22,380
Shareholder reports 18,916
Trustees' compensation 1,927
Transfer and shareholder servicing agent fees 524
Other 26,982
--------------
Total liabilities 31,681,872
- --------------------------------------------------------------------------------------------------------------------------
Net Assets $ 441,978,495
==============
- --------------------------------------------------------------------------------------------------------------------------
Composition of Net Assets
Par value of shares of beneficial interest $ 55,502
- --------------------------------------------------------------------------------------------------------------------------
Additional paid-in capital 536,325,987
- --------------------------------------------------------------------------------------------------------------------------
Undistributed net investment income 15,259,498
- --------------------------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions (108,982,656)
- --------------------------------------------------------------------------------------------------------------------------
Net unrealized depreciation on investments and translation of assets and liabilities denominated in
foreign currencies (679,836)
--------------
Net Assets $ 441,978,495
==============
- --------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
Non-Service shares:
Net asset value, redemption price per share and offering price per share (based on net assets
of $400,333,041 and 50,261,046 shares of beneficial interest outstanding) $7.97
- --------------------------------------------------------------------------------------------------------------------------
Service shares:
Net asset value, redemption price per share and offering price per share (based on net assets
of $41,645,454 and 5,241,408 shares of beneficial interest outstanding) $7.95
See accompanying Notes to Financial Statements.
17 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS Unaudited
- --------------------------------------------------------------------------------
For the Six Months Ended June 30, 2003
- -------------------------------------------------------------------------------------------
Investment Income
Interest (net of foreign withholding taxes of $93) $ 19,144,694
- -------------------------------------------------------------------------------------------
Dividends 174,095
--------------
Total investment income 19,318,789
- -------------------------------------------------------------------------------------------
Expenses
Management fees 1,441,120
- -------------------------------------------------------------------------------------------
Distribution and service plan fees-Service shares 34,621
- -------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Non-Service shares 4,243
Service shares 5,861
- -------------------------------------------------------------------------------------------
Shareholder reports 19,629
- -------------------------------------------------------------------------------------------
Trustees' compensation 8,338
- -------------------------------------------------------------------------------------------
Custodian fees and expenses 3,495
- -------------------------------------------------------------------------------------------
Other 24,394
--------------
Total expenses 1,541,701
Less reduction to custodian expenses (690)
--------------
Net expenses 1,541,011
- -------------------------------------------------------------------------------------------
Net Investment Income 17,777,778
- -------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments (6,258,244)
Closing of futures contracts (130,781)
Foreign currency transactions 3,885,819
--------------
Net realized loss (2,503,206)
- -------------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments 39,009,562
Translation of assets and liabilities denominated in foreign currencies 485,030
Futures contracts 110,571
--------------
Net change in unrealized appreciation 39,605,163
- -------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $54,879,735
==============
See accompanying Notes to Financial Statements.
18 OPPENHEIMER HIGH INCOME FUND/VA
STATEMENTS OF CHANGES IN NET ASSETS
Six Months Year
Ended Ended
June 30, 2003 December 31,
(Unaudited) 2002
- ---------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 17,777,778 $ 28,331,405
- ---------------------------------------------------------------------------------------------------------------
Net realized loss (2,503,206) (54,882,881)
- ---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation 39,605,163 18,653,181
------------------------------
Net increase (decrease) in net assets resulting from operations 54,879,735 (7,898,295)
- ---------------------------------------------------------------------------------------------------------------
Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Non-Service shares (26,819,814) (35,408,403)
Service shares (1,672,018) (306)
- ---------------------------------------------------------------------------------------------------------------
Beneficial Interest Transactions
Net increase in net assets resulting from beneficial interest transactions:
Non-Service shares 30,623,722 44,572,082
Service shares 21,592,157 17,318,687
- ---------------------------------------------------------------------------------------------------------------
Net Assets
Total increase 78,603,782 18,583,765
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 363,374,713 344,790,948
------------------------------
End of period [including undistributed net investment income
of $15,259,498 and $25,973,552, respectively] $441,978,495 $363,374,713
==============================
See accompanying Notes to Financial Statements.
19 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months Year
Ended Ended
June 30, 2003 December 31,
Non-Service shares (Unaudited) 2002 2001 2000 1999 1998
- ----------------------------------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $ 7.51 $ 8.54 $ 9.27 $10.72 $ 11.02 $ 11.52
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .34 .58 .84 1.00 1.01 .95
Net realized and unrealized gain (loss) .71 (.76) (.62) (1.36) (.55) (.90)
------------------------------------------------------------------------
Total from investment operations 1.05 (.18) .22 (.36) .46 .05
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.59) (.85) (.95) (1.09) (.76) (.25)
Distributions from net realized gain -- -- -- -- -- (.30)
------------------------------------------------------------------------
Total dividends and/or distributions to shareholders (.59) (.85) (.95) (1.09) (.76) (.55)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $7.97 $7.51 $8.54 $ 9.27 $10.72 $11.02
========================================================================
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 1 14.74% (2.40)% 1.97% (3.74)% 4.29% 0.31%
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $400,333 $345,670 $344,788 $333,533 $340,829 $328,563
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $368,199 $335,894 $347,723 $329,260 $340,519 $322,748
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 2
Net investment income 9.07% 8.29% 9.94% 10.47% 9.61% 8.65%
Expenses, gross 0.76% 0.77% 0.79% 0.79% 0.75% 0.78% 3
Expenses, net 0.76% 4 0.77% 4 0.79% 4 0.79% 4 0.75% 4 0.78%
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 26% 75% 46% 31% 33% 161%
<FN>
1. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and
distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value
calculated on the last business day of the fiscal period. Total returns are not annualized for periods less
than one full year. Total return information does not reflect expenses that apply at the separate account
level or to related insurance products. Inclusion of these charges would reduce the total return figures for
all periods shown. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
2. Annualized for periods of less than one full year.
3. Expense ratio has been calculated without adjustment for the reduction to custodian expenses.
4. Reduction to custodian expenses less than 0.01%.
</FN>
See accompanying Notes to Financial Statements.
20 OPPENHEIMER HIGH INCOME FUND/VA
Six Months Year
Ended Ended
June 30, 2003 December 31,
Service shares (Unaudited) 2002 2001 1
- --------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $ 7.49 $ 8.54 $ 8.40
- --------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .39 .88 .20
Net realized and unrealized gain (loss) .65 (1.08) (.06)
-----------------------------------
Total from investment operations 1.04 (.20) .14
- --------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.58) (.85) --
Distributions from net realized gain -- -- --
-----------------------------------
Total dividends and/or distributions to shareholders (.58) (.85) --
- --------------------------------------------------------------------------------------------------------
Net asset value, end of period $7.95 $7.49 $8.54
===================================
- --------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 2 14.70% (2.67)% 1.67%
- --------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $41,645 $17,705 $3
- --------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $28,046 $ 5,602 $2
- --------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 8.74% 8.91% 12.51%
Expenses, gross 1.05% 1.02% 0.96%
Expenses, net 1.05% 4 1.02% 4,5 0.96% 4
- --------------------------------------------------------------------------------------------------------
Portfolio turnover rate 26% 75% 46%
<FN>
1. For the period from September 18, 2001 (inception of offering) to December 31, 2001.
2. Assumes an investment on the business day before the first day of the fiscal period (or inception of
offering), with all dividends and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the fiscal period. Total returns are
not annualized for periods less than one full year. Total return information does not reflect expenses that
apply at the separate account level or to related insurance products. Inclusion of these charges would reduce
the total return figures for all periods shown. Returns do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Voluntary waiver of transfer agent fees less than 0.01%.
See accompanying Notes to Financial Statements.
</FN>
21 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Oppenheimer High Income Fund/VA (the Fund) is a separate series of Oppenheimer
Variable Account Funds (the Trust), an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek a high level of current income from investment
in high-yield fixed-income securities. The Trust's investment advisor is
OppenheimerFunds, Inc. (the Manager).
The Fund offers two classes of shares. Both classes are sold at their
offering price, which is the net asset value per share, to separate investment
accounts of participating insurance companies as an underlying investment for
variable life insurance policies, variable annuity contracts or other
investment products. The class of shares designated as Service shares is
subject to a distribution and service plan. All classes of shares have
identical rights and voting privileges. Earnings, net assets and net asset
value per share may differ by minor amounts due to each class having its own
expenses directly attributable to that class.
The following is a summary of significant accounting policies consistently
followed by the Fund.
- --------------------------------------------------------------------------------
Securities Valuation. Securities listed or traded on National Stock Exchanges
or other domestic or foreign exchanges are valued based on the last sale price
of the security traded on that exchange prior to the time when the Fund's
assets are valued. Securities traded on NASDAQ are valued based on the closing
price provided by NASDAQ prior to the time when the Fund's assets are valued.
In the absence of a sale, the security is valued at the last sale price on the
prior trading day, if it is within the spread of the closing bid and asked
prices, and if not, at the closing bid price. Securities (including restricted
securities) for which quotations are not readily available are valued primarily
using dealer-supplied valuations, a portfolio pricing service authorized by the
Board of Trustees, or at their fair value. Fair value is determined in good
faith using consistently applied procedures under the supervision of the Board
of Trustees. Short-term "money market type" debt securities with remaining
maturities of sixty days or less are valued at amortized cost (which
approximates market value).
- --------------------------------------------------------------------------------
Structured Notes. The Fund invests in index-linked structured notes whose
principal and/or interest depend on the performance of an underlying index. The
structured notes are leveraged, which increases the volatility of each note's
market value relative to the change in the underlying index. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss
when a structured note is sold or matures. As of June 30, 2003, the market
value of these securities comprised 5.9% of the Fund's net assets, and resulted
in unrealized gains in the current period of $175,753.
- --------------------------------------------------------------------------------
Securities Purchased on a When-Issued Basis. Delivery and payment for
securities that have been purchased by the Fund on a when-issued basis can take
place a month or more after the trade date. Normally the settlement date occurs
within six months after the trade date; however, the Fund may, from time to
time, purchase securities whose settlement date extends six months or more
beyond trade date. During this period, such securities do not earn interest,
are subject to market fluctuation and may increase or decrease in value prior
to their delivery. The Fund maintains segregated assets with a market value
equal to or greater than the amount of its purchase commitments. The purchase
of securities on a when-issued (or forward commitment) basis may increase the
volatility of the Fund's net asset value to the extent the Fund executes such
transactions while remaining substantially fully invested. As of June 30, 2003,
the Fund had entered into when-issued purchase commitments of $1,200,000.
Additionally, the Fund had when-issued sale commitments of $408,000.
- --------------------------------------------------------------------------------
Security Credit Risk. The Fund invests in high-yield securities, which may be
subject to a greater degree of credit risk, market fluctuations and loss of
income and principal, and may be more sensitive to economic conditions than
lower-yielding, higher-rated fixed-income securities. The Fund may acquire
securities in default, and is not obligated to dispose of securities whose
issuers subsequently default. As of June 30, 2003, securities with an aggregate
market value of $8,969,935, representing 2.03% of the Fund's net assets, were
in default.
22 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
Foreign Currency Translation. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of foreign securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains
and losses in the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
Joint Repurchase Agreements. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint
trading accounts on a daily basis. Secured by U.S. government securities, these
balances are invested in one or more repurchase agreements. Securities pledged
as collateral for repurchase agreements are held by a custodian bank until the
agreements mature. Each agreement requires that the market value of the
collateral be sufficient to cover payments of interest and principal. In the
event of default by the other party to the agreement, retention of the
collateral may be subject to legal proceedings.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
Federal Taxes. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders.
As of June 30, 2003, the Fund had available for federal income tax purposes
an estimated unused capital loss carryforward of $105,108,977. This estimated
capital loss carryforward represents carryforward as of the end of the last
fiscal year, increased for losses deferred under tax accounting rules to the
current fiscal year and increased or decreased by capital losses or gains
realized in the first six months of the current fiscal year. During the six
months ended June 30, 2003, the Fund did not use carryforward to offset capital
gains realized. During the year ended December 31, 2002, the Fund did not use
carryforward to offset capital gains realized.
As of December 31, 2002, the Fund had available for federal income tax purposes
unused capital loss carryforwards as follows:
Expiring
-------------------------
2006 $ 3,401,577
2007 4,933,260
2008 11,572,833
2009 22,696,701
2010 56,061,391
-----------
Total $98,665,762
===========
- --------------------------------------------------------------------------------
Dividends and Distributions to Shareholders. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income distributions, if any, are
declared daily and paid monthly. Capital gain distributions, if any, are
declared and paid annually.
- --------------------------------------------------------------------------------
Classification of Dividends and Distributions to Shareholders. Net investment
income (loss) and net realized gain (loss) may differ for financial statement
and tax purposes primarily due to paydown gains and losses and the recognition
of certain foreign currency gains (losses) as ordinary income (loss) for tax
purposes. The character of dividends and distributions made during the fiscal
year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes. Also, due to timing
of dividends and distributions, the fiscal
23 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. Significant Accounting Policies Continued
year in which amounts are distributed may differ from the fiscal year in which
the income or net realized gain was recorded by the Fund.
The tax character of distributions paid during the six months ended June 30,
2003 and the year ended December 31, 2002 was as follows:
Six Months Ended Year Ended
June 30, 2003 December 31, 2002
---------------------------------------------------------------------
Distributions paid from:
Ordinary income $28,491,832 $35,408,709
- --------------------------------------------------------------------------------
Investment Income. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and
amortization of premium, is accrued as earned.
- --------------------------------------------------------------------------------
Expense Offset Arrangement. The reduction of custodian fees represents earnings
on cash balances maintained by the Fund.
- --------------------------------------------------------------------------------
Security Transactions. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.
- --------------------------------------------------------------------------------
Other. The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
- --------------------------------------------------------------------------------
2. Shares of Beneficial Interest
The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial
interest were as follows:
Six Months Ended June 30, 2003 Year Ended December 31, 2002
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------------------------------
Non-Service shares
Sold 11,694,830 $ 89,595,374 22,935,486 $ 176,263,288
Dividends and/or distributions reinvested 3,719,808 26,819,814 4,568,826 35,408,403
Redeemed (11,208,620) (85,791,466) (21,816,082) (167,099,609)
------------------------------------------------------------------
Net increase 4,206,018 $ 30,623,722 5,688,230 $ 44,572,082
==================================================================
- -------------------------------------------------------------------------------------------------------------------
Service shares
Sold 4,273,184 $ 32,526,360 2,741,181 $ 20,012,961
Dividends and/or distributions reinvested 232,224 1,672,018 39 306
Redeemed (1,627,163) (12,606,221) (378,418) (2,694,580)
------------------------------------------------------------------
Net increase 2,878,245 $ 21,592,157 2,362,802 $ 17,318,687
==================================================================
- --------------------------------------------------------------------------------
3. Purchases and Sales of Securities
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the six months ended June 30, 2003, were
$142,830,423 and $89,056,309, respectively.
24 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
4. Fees and Other Transactions with Affiliates
Management Fees. Management fees paid to the Manager were in accordance with
the investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% on the next $200 million and 0.50% of average annual
net assets over $1 billion.
- --------------------------------------------------------------------------------
Transfer Agent Fees. OppenheimerFunds Services (OFS), a division of the
Manager, acts as the transfer and shareholder servicing agent for the Fund. The
Fund pays OFS a $22.50 per account fee.
Additionally, funds offered in variable annuity separate accounts are
subject to minimum fees of $5,000 for assets of less than $10 million and
$10,000 for assets of $10 million or more. The Fund is subject to the minimum
fee in the event that the per account fee does not equal or exceed the
applicable minimum fee.
OFS has voluntarily agreed to limit transfer and shareholder servicing agent
fees up to an annual rate of 0.35% of average net assets of the Fund. This
undertaking may be amended or withdrawn at any time.
- --------------------------------------------------------------------------------
Distribution and Service Plan for Service Shares. The Fund has adopted a
Distribution and Service Plan for Service shares to pay OppenheimerFunds
Distributor, Inc., the Distributor, for distribution-related services for the
Fund's Service shares. Under the Plan, payments are made quarterly at an annual
rate of up to 0.25% of the average annual net assets of the Service shares of
the Fund. For the six months ended June 30, 2003, expense under the Service
Plan totaled $34,621.
- --------------------------------------------------------------------------------
5. Foreign Currency Contracts
A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into
foreign currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation
or depreciation.
The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gain or loss. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.
As of June 30, 2003, the Fund had no outstanding foreign currency contracts.
- --------------------------------------------------------------------------------
6. Futures Contracts
A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy
and sell futures contracts that relate to broadly based securities indices
"financial futures" or debt securities "interest rate futures" in order to gain
exposure to or protection from changes in market value of stock and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.
The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it
may be more efficient or cost effective than actually buying fixed income
securities.
25 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
6. Futures Contracts Continued
Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.
Cash held by the broker to cover initial margin requirements on open futures
contracts is noted in the Statement of Assets and Liabilities. Securities held
in collateralized accounts to cover initial margin requirements on open futures
contracts are noted in the Statement of Investments. The Statement of Assets
and Liabilities reflects a receivable and/or payable for the daily mark to
market for variation margin. Realized gains and losses are reported in the
Statement of Operations as closing and expiration of futures contracts. The net
change in unrealized appreciation and depreciation is reported on the Statement
of Operations.
Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.
As of June 30, 2003, the Fund had outstanding futures contracts as follows:
Expiration Number of Valuation as of Unrealized
Contract Description Dates Contracts June 30, 2003 Appreciation
- --------------------------------------------------------------------------------------------------------------
Contracts to Purchase
U.S. Treasury Nts., 5 yr. 9/19/03 6 $690,750 $391
U.S. Treasury Nts., 10 yr. 9/19/03 1 117,438 23
----
$414
====
- --------------------------------------------------------------------------------
7. Illiquid or Restricted Securities
As of June 30, 2003, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private
placement transactions, are not registered under the Securities Act of 1933,
may have contractual restrictions on resale, and are valued under methods
approved by the Board of Trustees as reflecting fair value. A security may also
be considered illiquid if it lacks a readily available market or if its
valuation has not changed for a certain period of time. The Fund intends to
invest no more than 15% of its net assets (determined at the time of purchase
and reviewed periodically) in illiquid or restricted securities. Certain
restricted securities, eligible for resale to qualified institutional
investors, are not subject to that limitation. The aggregate value of illiquid
or restricted securities subject to this limitation as of June 30, 2003 was
$32,394,772, which represents 7.33% of the Fund's net assets, of which zero is
considered restricted. Information concerning restricted securities is as
follows:
Acquisition Valuation as of Unrealized
Security Dates Cost June 30, 2003 Depreciation
- --------------------------------------------------------------------------------------------------------------
Stocks and/or Warrants
Geotek Communications, Inc. 4/6/00 $ -- $-- $ --
Real Time Data Co. Wts., Exp. 5/31/04 6/30/99 1,214 -- 1,214
26 OPPENHEIMER HIGH INCOME FUND/VA
- --------------------------------------------------------------------------------
8. Borrowing and Lending Arrangements
The Fund entered into an "interfund borrowing and lending arrangement" with
other funds in the Oppenheimer funds complex, to allow funds to borrow for
liquidity purposes. The arrangement was initiated pursuant to exemptive relief
granted by the Securities and Exchange Commission to allow these affiliated
funds to lend money to, and borrow money from, each other, in an attempt to
reduce borrowing costs below those of bank loan facilities. Under the
arrangement the Fund may lend money to other Oppenheimer funds and may borrow
from other Oppenheimer funds at a rate set by the Fund's Board of Trustees,
based upon a recommendation by the Manager. The Fund's borrowings, if any, are
subject to asset coverage requirements under the Investment Company Act and the
provisions of the SEC order and other applicable regulations. If the Fund
borrows money, there is a risk that the loan could be called on one day's
notice, in which case the Fund might have to borrow from a bank at higher rates
if a loan were not available from another Oppenheimer fund. If the Fund lends
money to another fund, it will be subject to the risk that the other fund might
not repay the loan in a timely manner, or at all.
The Fund had no interfund borrowings or loans outstanding during the six
months ended or at June 30, 2003.
- --------------------------------------------------------------------------------
Portfolio Proxy Voting Policies and Procedures
The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which
the Fund votes proxies relating to securities ("portfolio proxies") held by the
Fund. A description of the Fund's Portfolio Proxy Voting Policies and
Procedures is available (i) without charge, upon request, by calling the Fund
toll-free at 1.800.225.5677, (ii) on the Fund's website at
www.oppenheimerfunds.com, and (iii) on the SEC's website at www.sec.gov. In
addition, the Fund will be required to file new Form N-PX, with its complete
proxy voting record for the 12 months ended June 30th, no later than August
31st of each year. The first such filing is due no later than August 31, 2004,
for the twelve months ended June 30, 2004. Once filed, the Fund's Form N-PX
filing will be available (i) without charge, upon request, by calling the Fund
toll-free at 1.800.225.5677, and (ii) on the SEC's website at www.sec.gov.
27 OPPENHEIMER HIGH INCOME FUND/VA
ITEM 2. CODE OF ETHICS - NOT REQUIRED
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT - NOT REQUIRED
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES - NOT REQUIRED
ITEM 5. RESERVED
ITEM 6. RESERVED
ITEM 7. NOT APPLICABLE
ITEM 8. RESERVED
ITEM 9. CONTROLS AND PROCEDURES
(a) Based on their evaluation of registrant's disclosure controls and
procedures (as defined in rule 30a-2(c) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(c)) as of June 30, 2003, registrant's
principal executive officer and principal financial officer found
registrant's disclosure controls and procedures to be appropriately
designed to ensure that information required to be disclosed by
registrant in the reports that it files under the Securities Exchange
Act of 1934 (a) is accumulated and communicated to registrant's
management, including its principal executive officer and principal
financial officer, to allow timely decisions regarding required
disclosure, and (b) is recorded, processed, summarized and reported,
within the time periods specified in the rules and forms adopted by the
U.S. Securities and Exchange Commission.
(b) There have been no significant changes in registrant's internal
controls or in other factors that could significantly affect
registrant's internal controls subsequent to the date of the most
recent evaluation as indicated, including no significant deficiencies
or material weaknesses that required corrective action.
ITEM 10. EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS)