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 811-2849
Oppenheimer High Yield Fund
---------------------------
(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.
Two World Financial Center, New York, New York 10281-1008
(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
--------------
Date of fiscal year end: June 30
-------
Date of reporting period: June 30, 2005
-------------
ITEM 1. REPORTS TO STOCKHOLDERS.
TOP HOLDINGS AND ALLOCATIONS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--TOP TEN INDUSTRIES
- --------------------------------------------------------------------------------
Media 11.5%
- --------------------------------------------------------------------------------
Hotels, Restaurants & Leisure 7.0
- --------------------------------------------------------------------------------
Wireless Telecommunication Services 6.1
- --------------------------------------------------------------------------------
Oil & Gas 6.0
- --------------------------------------------------------------------------------
Health Care Providers & Services 5.8
- --------------------------------------------------------------------------------
Electric Utilities 4.9
- --------------------------------------------------------------------------------
Diversified Telecommunication Services 4.4
- --------------------------------------------------------------------------------
Chemicals 4.0
- --------------------------------------------------------------------------------
Containers & Packaging 3.6
- --------------------------------------------------------------------------------
Metals & Mining 3.3
Portfolio holdings and allocations are subject to change. Percentages are as of
June 30, 2005, and are based on net assets.
For more current Top 10 Fund holdings, please visit www.oppenheimerfunds.com.
- --------------------------------------------------------------------------------
8 | OPPENHEIMER HIGH YIELD FUND
- --------------------------------------------------------------------------------
CREDIT ALLOCATION
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
A 0.2%
BBB 2.4
BB 20.2
B 56.4
CCC 9.0
CC 0.4
C 0.2
Not Rated 10.3
Other Securities 0.9
Portfolio holdings and allocations are subject to change. Percentages are as of
June 30, 2005, and are based on total market value of investments. Average
credit quality and ratings include securities rated by a national rating
organization. Under normal market conditions, the Fund invests at least 80% of
its assets (plus borrowings for investment purposes) in high yield, lower rated
investments, which include high yield, lower rated fixed income securities
commonly known as "junk bonds". Securities rated below investment grade carry a
greater risk of default. While the Fund has generally invested under 15% of its
assets in foreign securities, which are subject to exchange rate and political
uncertainties, it is not restricted to any amount by the prospectus.
- --------------------------------------------------------------------------------
9 | OPPENHEIMER HIGH YIELD FUND
FUND PERFORMANCE DISCUSSION
- --------------------------------------------------------------------------------
HOW HAS THE FUND PERFORMED? BELOW IS A DISCUSSION BY OPPENHEIMERFUNDS, INC., OF
THE FUND'S PERFORMANCE DURING ITS FISCAL YEAR ENDED JUNE 30, 2005, FOLLOWED BY A
GRAPHICAL COMPARISON OF THE FUND'S PERFORMANCE TO AN APPROPRIATE BROAD-BASED
MARKET INDEX.
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE. We are generally satisfied with the
Fund's performance during its fiscal year ended June 30, 2005. We attribute the
Fund's performance to its generally neutral investment posture during the final
weeks of 2004, when a pronounced market rally was especially beneficial to the
performance of more aggressively positioned investors.
As economic conditions improved during the first half of the reporting
period, lower-rated credit appeared to reach fuller valuations. In response, we
increased the Fund's emphasis on higher-rated credits, shifting our focus from
"triple-C" rated bonds to those with "double-B" ratings. In addition, to guard
against the potentially adverse effects of higher interest rates, we generally
preferred shorter-term, higher-coupon securities. Traditionally, securities with
these characteristics have held more of their value during market declines.
While these strategies may have prevented the Fund from participating more fully
in the market rally near year-end 2004, they nonetheless protected the Fund from
heightened volatility in the spring of 2005.
The Fund received positive contributions to performance from its
relatively heavy investments in the telecommunications sector, which benefited
from a surge in mergers-and-acquisitions activity when AT&T Corp. was purchased
by SBC Communications Corp., MCI, Inc. received bids from Verizon and Western
Wireless Corp. was bought by Alltel. The Fund's investments in the three
acquisition targets contributed positively to its performance, as did its
participation in bonds issued by companies that build and maintain cellular
telephone towers. In addition, the Fund also enjoyed good returns from its
relatively heavy exposure to the cable television, energy and basic materials
sectors, including chemical producers, steel makers and general manufacturers.
In the utilities area, electricity producer Dynegy Holdings, Inc. was a notably
positive contributor to the Fund's results.
Although the Fund's relative performance benefited from its relatively
light holdings of bonds from airlines and automobile companies, even a small
amount of exposure to these troubled areas held back absolute returns. In
addition, holdings detracting from the Fund's performance included
manufacturers, especially in the paper and packaging industry, that were hurt by
higher raw materials costs that they were unable to pass along to their
customers.
10 | OPPENHEIMER HIGH YIELD FUND
As of the end of the reporting period, we have begun to reduce the Fund's
emphasis on securities from economically-sensitive companies, and we have
focused instead on income-oriented, shorter-duration bonds with credit ratings
toward the higher end of the high-yield range. In our view, these types of
securities are more likely to fare well as the economic cycle matures.
COMPARING THE FUND'S PERFORMANCE TO THE MARKET. The graphs that follow show the
performance of a hypothetical $10,000 investment in each class of shares of the
Fund held until June 30, 2005. In the case of Class A and Class B shares,
performance is measured over a ten-year period. In the case of Class C shares,
performance is measured from the inception of the Class on November 1, 1995. In
the case of Class N shares, performance is measured from inception of the Class
on March 1, 2001. In the case of Class Y shares, performance is measured from
inception of the class on October 15, 1997. The Fund's performance reflects the
deduction of the maximum initial sales charge on Class A shares, the applicable
contingent deferred sales charge on Class B, Class C and Class N shares, and
reinvestments of all dividends and capital gains distributions. Past performance
cannot guarantee future results.
The Fund's performance is compared to the performance of the Merrill Lynch
High Yield Master Index, an unmanaged index of below investment grade securities
of U.S. corporate debt issuers, and the Lehman Brothers Credit Index, an index
of non-convertible U.S. investment-grade corporate bonds. Index performance
reflects the reinvestment of income but does not consider the effect of
transaction costs, and none of the data in the graphs shows the effect of taxes.
The Fund's performance reflects the effects of the Fund's business and operating
expenses. While index comparisons may be useful to provide a benchmark for the
Fund's performance, it must be noted that the Fund's investments are not limited
to the investments in the index.
11 | OPPENHEIMER HIGH YIELD FUND
CLASS A SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer High Yield Fund (Class A)
Merrill Lynch High Yield Master Index
Lehman Brothers Credit Index
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer High Merrill Lynch High Lehman Brothers
Yield Fund (Class A) Yield Master Index Credit Index
06/30/95 9,525 10,000 10,000
09/30/95 9,807 10,292 10,236
12/31/95 10,133 10,634 10,742
03/31/96 10,495 10,789 10,464
06/30/96 10,692 10,937 10,512
09/30/96 11,166 11,364 10,722
12/31/96 11,578 11,811 11,095
03/31/97 11,569 11,934 10,983
06/30/97 12,093 12,501 11,436
09/30/97 12,714 12,990 11,883
12/31/97 12,958 13,326 12,230
03/31/98 13,524 13,697 12,417
06/30/98 13,585 13,926 12,737
09/30/98 12,580 13,428 13,199
12/31/98 12,972 13,814 13,279
03/31/99 13,460 13,963 13,184
06/30/99 13,489 14,057 12,978
09/30/99 13,313 13,881 13,015
12/31/99 13,512 14,031 13,019
03/31/00 13,334 13,778 13,205
06/30/00 13,585 13,864 13,368
09/30/00 13,655 14,052 13,778
12/31/00 12,986 13,499 14,241
03/31/01 13,550 14,338 14,850
06/30/01 13,083 14,156 15,008
09/30/01 12,181 13,584 15,583
12/31/01 12,979 14,337 15,723
03/31/02 12,973 14,617 15,681
06/30/02 12,368 13,719 16,135
09/30/02 11,858 13,286 16,859
12/31/02 12,411 14,172 17,378
03/31/03 13,163 15,150 17,794
06/30/03 14,394 16,616 18,648
09/30/03 14,783 17,036 18,621
12/31/03 15,681 18,031 18,714
03/31/04 15,959 18,434 19,327
06/30/04 15,962 18,272 18,665
09/30/04 16,476 19,119 19,449
12/31/04 17,171 19,972 19,696
03/31/05 16,934 19,685 19,487
06/30/05 17,215 20,216 20,183
AVERAGE ANNUAL TOTAL RETURNS OF CLASS A SHARES WITH SALES CHARGE OF THE FUND AT
6/30/05
1-Year 2.73% 5-Year 3.84% 10-Year 5.58%
12 | OPPENHEIMER HIGH YIELD FUND
CLASS B SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer High Yield Fund (Class B)
Merrill Lynch High Yield Master Index
Lehman Brothers Credit Index
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer High Merrill Lynch High Lehman Brothers
Yield Fund (Class B) Yield Master Index Credit Index
06/30/95 10,000 10,000 10,000
09/30/95 10,270 10,292 10,236
12/31/95 10,593 10,634 10,742
03/31/96 10,954 10,789 10,464
06/30/96 11,140 10,937 10,512
09/30/96 11,606 11,364 10,722
12/31/96 12,014 11,811 11,095
03/31/97 11,983 11,934 10,983
06/30/97 12,496 12,501 11,436
09/30/97 13,110 12,990 11,883
12/31/97 13,337 13,326 12,230
03/31/98 13,888 13,697 12,417
06/30/98 13,934 13,926 12,737
09/30/98 12,869 13,428 13,199
12/31/98 13,247 13,814 13,279
03/31/99 13,714 13,963 13,184
06/30/99 13,727 14,057 12,978
09/30/99 13,520 13,881 13,015
12/31/99 13,687 14,031 13,019
03/31/00 13,479 13,778 13,205
06/30/00 13,710 13,864 13,368
09/30/00 13,755 14,052 13,778
12/31/00 13,061 13,499 14,241
03/31/01 13,597 14,338 14,850
06/30/01 13,111 14,156 15,008
09/30/01 12,206 13,584 15,583
12/31/01 13,006 14,337 15,723
03/31/02 13,000 14,617 15,681
06/30/02 12,394 13,719 16,135
09/30/02 11,883 13,286 16,859
12/31/02 12,437 14,172 17,378
03/31/03 13,190 15,150 17,794
06/30/03 14,424 16,616 18,648
09/30/03 14,815 17,036 18,621
12/31/03 15,714 18,031 18,714
03/31/04 15,993 18,434 19,327
06/30/04 15,996 18,272 18,665
09/30/04 16,511 19,119 19,449
12/31/04 17,207 19,972 19,696
03/31/05 16,970 19,685 19,487
06/30/05 17,253 20,216 20,183
AVERAGE ANNUAL TOTAL RETURNS OF CLASS B SHARES WITH SALES CHARGE OF THE FUND AT
6/30/05
1-Year 2.05% 5-Year 3.77% 10-Year 5.61%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 4.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE CLASS B SHARES CONVERT TO
CLASS A SHARES 72 MONTHS AFTER PURCHASE, LIFE AND 10-YEAR RETURNS FOR CLASS B
SHARES USES CLASS A PERFORMANCE FOR THE PERIOD AFTER CONVERSION. SEE PAGE 17 FOR
FURTHER PERFORMANCE INFORMATION.
13 | OPPENHEIMER HIGH YIELD FUND
FUND PERFORMANCE DISCUSSION
- --------------------------------------------------------------------------------
CLASS C SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer High Yield Fund (Class C)
Merrill Lynch High Yield Master Index
Lehman Brothers Credit Index
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer High Merrill Lynch High Lehman Brothers
Yield Fund (Class C) Yield Master Index Credit Index
11/01/95 10,000 10,000 10,000
12/31/95 10,218 10,260 10,359
03/31/96 10,561 10,409 10,092
06/30/96 10,736 10,552 10,137
09/30/96 11,182 10,964 10,340
12/31/96 11,580 11,395 10,700
03/31/97 11,549 11,514 10,592
06/30/97 12,048 12,061 11,028
09/30/97 12,627 12,533 11,460
12/31/97 12,854 12,856 11,795
03/31/98 13,390 13,214 11,975
06/30/98 13,424 13,436 12,283
09/30/98 12,405 12,955 12,729
12/31/98 12,766 13,327 12,806
03/31/99 13,222 13,471 12,715
06/30/99 13,224 13,562 12,516
09/30/99 13,026 13,392 12,551
12/31/99 13,196 13,537 12,555
03/31/00 12,996 13,293 12,735
06/30/00 13,217 13,376 12,892
09/30/00 13,260 13,557 13,287
12/31/00 12,585 13,023 13,734
03/31/01 13,108 13,833 14,321
06/30/01 12,632 13,657 14,473
09/30/01 11,736 13,106 15,028
12/31/01 12,483 13,832 15,163
03/31/02 12,468 14,102 15,123
06/30/02 11,864 13,236 15,560
09/30/02 11,353 12,818 16,258
12/31/02 11,845 13,673 16,759
03/31/03 12,542 14,617 17,161
06/30/03 13,692 16,030 17,984
09/30/03 14,036 16,436 17,958
12/31/03 14,862 17,396 18,047
03/31/04 15,082 17,785 18,638
06/30/04 15,056 17,628 18,000
09/30/04 15,528 18,446 18,756
12/31/04 16,136 19,268 18,994
03/31/05 15,881 18,992 18,793
06/30/05 16,113 19,504 19,464
AVERAGE ANNUAL TOTAL RETURNS OF CLASS C SHARES WITH SALES CHARGE OF THE FUND AT
6/30/05
1-Year 6.02% 5-Year 4.04% Since Inception (11/1/95) 5.06%
14 | OPPENHEIMER HIGH YIELD FUND
CLASS N SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer High Yield Fund (Class N)
Merrill Lynch High Yield Master Index
Lehman Brothers Credit Index
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer High Merrill Lynch High Lehman Brothers
Yield Fund (Class N) Yield Master Index Credit Index
03/01/01 10,000 10,000 10,000
03/31/01 9,682 9,868 10,062
06/30/01 9,357 9,743 10,169
09/30/01 8,711 9,349 10,559
12/31/01 9,278 9,867 10,653
03/31/02 9,278 10,060 10,625
06/30/02 8,840 9,442 10,932
09/30/02 8,471 9,144 11,423
12/31/02 8,864 9,754 11,775
03/31/03 9,394 10,427 12,057
06/30/03 10,262 11,436 12,635
09/30/03 10,527 11,725 12,617
12/31/03 11,157 12,410 12,680
03/31/04 11,334 12,687 13,095
06/30/04 11,336 12,575 12,647
09/30/04 11,689 13,158 13,178
12/31/04 12,170 13,745 13,345
03/31/05 11,980 13,548 13,204
06/30/05 12,166 13,913 13,675
AVERAGE ANNUAL TOTAL RETURNS OF CLASS N SHARES WITH SALES CHARGE OF THE FUND AT
6/30/05
1-Year 6.32% 5-Year N/A Since Inception (3/1/01) 4.63%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 4.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE CLASS B SHARES CONVERT TO
CLASS A SHARES 72 MONTHS AFTER PURCHASE, LIFE AND 10-YEAR RETURNS FOR CLASS B
SHARES USES CLASS A PERFORMANCE FOR THE PERIOD AFTER CONVERSION. SEE PAGE 17 FOR
FURTHER PERFORMANCE INFORMATION.
15 | OPPENHEIMER HIGH YIELD FUND
FUND PERFORMANCE DISCUSSION
- --------------------------------------------------------------------------------
CLASS Y SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer High Yield Fund (Class Y)
Merrill Lynch High Yield Master Index
Lehman Brothers Credit Index
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer High Merrill Lynch High Lehman Brothers
Yield Fund (Class Y) Yield Master Index Credit Index
10/15/97 10,000 10,000 10,000
12/31/97 10,078 10,258 10,292
03/31/98 10,518 10,544 10,449
06/30/98 10,581 10,721 10,718
09/30/98 9,798 10,337 11,107
12/31/98 10,111 10,634 11,174
03/31/99 10,493 10,749 11,095
06/30/99 10,524 10,821 10,921
09/30/99 10,387 10,686 10,952
12/31/99 10,545 10,801 10,956
03/31/00 10,407 10,606 11,112
06/30/00 10,614 10,673 11,249
09/30/00 10,679 10,817 11,594
12/31/00 10,145 10,392 11,984
03/31/01 10,592 11,037 12,496
06/30/01 10,235 10,897 12,629
09/30/01 9,529 10,457 13,113
12/31/01 10,151 11,036 13,231
03/31/02 10,160 11,252 13,196
06/30/02 9,686 10,561 13,578
09/30/02 9,287 10,228 14,187
12/31/02 9,715 10,910 14,624
03/31/03 10,311 11,663 14,974
06/30/03 11,284 12,791 15,692
09/30/03 11,580 13,114 15,670
12/31/03 12,290 13,880 15,748
03/31/04 12,498 14,191 16,264
06/30/04 12,503 14,066 15,707
09/30/04 12,923 14,718 16,366
12/31/04 13,458 15,375 16,574
03/31/05 13,271 15,154 16,399
06/30/05 13,493 15,562 16,984
AVERAGE ANNUAL TOTAL RETURNS OF CLASS Y SHARES WITH SALES CHARGE OF THE FUND AT
6/30/05
1-Year 7.92% 5-Year 4.92% Since Inception (10/15/97) 3.96%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 4.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE CLASS B SHARES CONVERT TO
CLASS A SHARES 72 MONTHS AFTER PURCHASE, LIFE AND 10-YEAR RETURNS FOR CLASS B
SHARES USES CLASS A PERFORMANCE FOR THE PERIOD AFTER CONVERSION. SEE PAGE 17 FOR
FURTHER PERFORMANCE INFORMATION.
16 | OPPENHEIMER HIGH YIELD FUND
NOTES
- --------------------------------------------------------------------------------
TOTAL RETURNS AND THE ENDING ACCOUNT VALUES IN THE GRAPHS INCLUDE CHANGES IN
SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS IN A
HYPOTHETICAL INVESTMENT FOR THE PERIODS SHOWN. THE FUND'S TOTAL RETURNS SHOWN DO
NOT REFLECT THE DEDUCTION OF INCOME TAXES ON AN INDIVIDUAL'S INVESTMENT. TAXES
MAY REDUCE YOUR ACTUAL INVESTMENT RETURNS ON INCOME OR GAINS PAID BY THE FUND OR
ANY GAINS YOU MAY REALIZE IF YOU SELL YOUR SHARES.
INVESTORS SHOULD CONSIDER THE FUND'S INVESTMENT OBJECTIVES, RISKS, AND OTHER
CHARGES AND EXPENSES CAREFULLY BEFORE INVESTING. THE FUND'S PROSPECTUS CONTAINS
THIS AND OTHER INFORMATION ABOUT THE FUND, AND MAY BE OBTAINED BY ASKING YOUR
FINANCIAL ADVISOR, CALLING US AT 1.800.525.7048 OR VISITING OUR WEBSITE AT
WWW.OPPENHEIMER-FUNDS.COM. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
THE FUND'S INVESTMENT STRATEGY AND FOCUS CAN CHANGE OVER TIME. THE MENTION OF
SPECIFIC FUND HOLDINGS DOES NOT CONSTITUTE A RECOMMENDATION BY OPPENHEIMERFUNDS,
INC.
CLASS A shares of the Fund were first publicly offered on 7/28/78. Class A
returns include the current maximum initial sales charge of 4.75%.
CLASS B shares of the Fund were first publicly offered on 5/3/93. Class B
returns include the applicable contingent deferred sales charge of 5% (1-year)
and 2% (5-year). Because Class B shares convert to Class A shares 72 months
after purchase, the "since inception" return for Class B uses Class A
performance for the period after conversion. Class B shares are subject to an
annual 0.75% asset-based sales charge.
CLASS C shares of the Fund were first publicly offered on 11/1/95. Class C
returns include the contingent deferred sales charge of 1% for the 1-year
period. Class C shares are subject to an annual 0.75% asset-based sales charge.
CLASS N shares of the Fund were first publicly offered on 3/1/01. Class N shares
are offered only through retirement plans. Unless otherwise noted, Class N
returns include the contingent deferred sales charge of 1% for the 1-year
period. Class N shares are subject to an annual 0.25% asset-based sales charge.
CLASS Y shares of the Fund were first publicly offered on 10/15/97. Class Y
shares are offered only to certain institutional investors under special
agreement with the Distributor.
An explanation of the calculation of performance is in the Fund's Statement of
Additional Information.
17 | OPPENHEIMER HIGH YIELD FUND
FUND EXPENSES
- --------------------------------------------------------------------------------
FUND EXPENSES. As a shareholder of the Fund, you incur two types of costs: (1)
transaction costs, which may include sales charges (loads) on purchase payments,
contingent deferred sales charges on redemptions; and redemption fees, if any;
and (2) ongoing costs, including management fees; distribution and service fees;
and other Fund expenses. These examples are intended to help you understand your
ongoing costs (in dollars) of investing in the Fund and to compare these costs
with the ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000.00 invested at the beginning
of the period and held for the entire 6-month period ended June 30, 2005.
ACTUAL EXPENSES. The "actual" lines of the table provide information about
actual account values and actual expenses. You may use the information on this
line for the class of shares you hold, together with the amount you invested, to
estimate the expense that you paid over the period. Simply divide your account
value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00
= 8.60), then multiply the result by the number in the "actual" line under the
heading entitled "Expenses Paid During Period" to estimate the expenses you paid
on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The "hypothetical" lines of the
table provide information about hypothetical account values and hypothetical
expenses based on the Fund's actual expense ratio for each class of shares, and
an assumed rate of return of 5% per year before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Fund and other funds. To do so, compare this 5% hypothetical example for
the class of shares you hold with the 5% hypothetical examples that appear in
the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front-end
or contingent deferred sales charges (loads), redemption fees, or a $12.00 fee
imposed annually on accounts valued at less than $500.00 (subject to
18 | OPPENHEIMER HIGH YIELD FUND
exceptions described in the Statement of Additional Information). Therefore, the
"hypothetical" lines of the table are useful in comparing ongoing costs only,
and will not help you determine the relative total costs of owning different
funds. In addition, if these transactional costs were included, your costs would
have been higher.
- --------------------------------------------------------------------------------
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
(1/1/05) (6/30/05) JUNE 30, 2005
- --------------------------------------------------------------------------------
Class A Actual $ 1,000.00 $ 1,002.60 $ 5.13
- --------------------------------------------------------------------------------
Class A Hypothetical 1,000.00 1,019.69 5.17
- --------------------------------------------------------------------------------
Class B Actual 1,000.00 998.20 8.96
- --------------------------------------------------------------------------------
Class B Hypothetical 1,000.00 1,015.87 9.04
- --------------------------------------------------------------------------------
Class C Actual 1,000.00 998.60 9.06
- --------------------------------------------------------------------------------
Class C Hypothetical 1,000.00 1,015.77 9.14
- --------------------------------------------------------------------------------
Class N Actual 1,000.00 999.60 7.07
- --------------------------------------------------------------------------------
Class N Hypothetical 1,000.00 1,017.75 7.13
- --------------------------------------------------------------------------------
Class Y Actual 1,000.00 1,002.60 4.83
- --------------------------------------------------------------------------------
Class Y Hypothetical 1,000.00 1,019.98 4.87
Hypothetical assumes 5% annual return before expenses.
Expenses are equal to the Fund's annualized expense ratio for that class,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period). Those annualized expense ratios based on
the 6-month period ended June 30, 2005 are as follows:
CLASS EXPENSE RATIOS
- --------------------------------
Class A 1.03%
- --------------------------------
Class B 1.80
- --------------------------------
Class C 1.82
- --------------------------------
Class N 1.42
- --------------------------------
Class Y 0.97
The expense ratios reflect voluntary waivers or reimbursements of expenses by
the Fund's Transfer Agent that can be terminated at any time, without advance
notice. The "Financial Highlights" tables in the Fund's financial statements,
included in this report, also show the gross expense ratios, without such
waivers or reimbursements.
- --------------------------------------------------------------------------------
19 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS June 30, 2005
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--0.7%
- --------------------------------------------------------------------------------
Goldman Sachs Asset Management CBO Ltd., Sub.
Collateralized Bond Obligations, Series 1A,
Cl. D, 12.54%, 6/13/11 1 $ 2,000,000 $ 340,000
- --------------------------------------------------------------------------------
Norse CBO Ltd., 9.342% Sub. Bonds, Series 1A,
Cl. C2, 8/13/10 1 11,000,000 9,350,000
-----------------
Total Asset-Backed Securities
(Cost $12,532,941) 9,690,000
- --------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--87.8%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--26.0%
- --------------------------------------------------------------------------------
AUTO COMPONENTS--2.4%
Accuride Corp., 8.50% Sr. Unsec. Sub. Nts.,
2/1/15 1,465,000 1,439,363
- --------------------------------------------------------------------------------
Collins & Aikman Floorcoverings, Inc., 9.75%
Sr. Sub. Nts., Series B, 2/15/10 1,500,000 1,560,000
- --------------------------------------------------------------------------------
Cooper Standard Automotive, Inc., 8.375% Sr.
Unsec. Sub. Nts., 12/15/14 2,570,000 2,043,150
- --------------------------------------------------------------------------------
Dana Corp., 10.125% Nts., 3/15/10 1,800,000 1,885,072
- --------------------------------------------------------------------------------
Dura Operating Corp.:
8.625% Sr. Nts., Series B, 4/15/12 3,500,000 3,167,500
9% Sr. Sub. Nts., Series B, 5/1/09 [EUR] 200,000 162,766
9% Sr. Unsec. Sub. Nts., Series D, 5/1/09 600,000 420,000
- --------------------------------------------------------------------------------
Eagle-Picher, Inc., 9.75% Sr. Nts.,
9/1/13 2,3 3,350,000 2,328,250
- --------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. (The):
7.857% Nts., 8/15/11 5,100,000 4,985,250
9% Sr. Nts., 7/1/15 4 3,670,000 3,624,125
- --------------------------------------------------------------------------------
Keystone Automotive Operations, Inc., 9.75%
Sr. Unsec. Sub. Nts., 11/1/13 900,000 895,500
- --------------------------------------------------------------------------------
Metaldyne Corp.:
10% Sr. Nts., 11/1/13 4 1,500,000 1,237,500
11% Sr. Sub. Nts., 6/15/12 1,540,000 1,004,850
- --------------------------------------------------------------------------------
Stoneridge, Inc., 11.50% Sr. Nts., 5/1/12 2,600,000 2,665,000
- --------------------------------------------------------------------------------
Tenneco Automotive, Inc.:
8.625% Sr. Unsec. Sub. Nts., 11/15/14 4,500,000 4,545,000
10.25% Sr. Sec. Nts., Series B, 7/15/13 2,300,000 2,610,500
- --------------------------------------------------------------------------------
United Components, Inc., 9.375% Sr. Sub.
Nts., 6/15/13 1,300,000 1,316,250
- --------------------------------------------------------------------------------
Visteon Corp., 7% Sr. Unsec. Nts., 3/10/14 900,000 747,000
-----------------
36,637,076
- --------------------------------------------------------------------------------
AUTOMOBILES--0.6%
General Motors Acceptance Corp.:
5.125% Nts., 5/9/08 3,000,000 2,821,608
5.85% Sr. Unsec. Unsub. Nts., 1/14/09 2,500,000 2,345,345
6.875% Nts., 9/15/11 2,900,000 2,680,229
- --------------------------------------------------------------------------------
Navistar International Corp., 6.25% Sr. Nts.,
3/1/12 4 1,235,000 1,197,950
-----------------
9,045,132
20 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--7.0%
Apcoa, Inc., 9.25% Sr. Unsec. Sub. Nts.,
3/15/08 $ 3,080,000 $ 3,033,800
- --------------------------------------------------------------------------------
Aztar Corp., 9% Sr. Unsec. Sub. Nts., 8/15/11 1,300,000 1,418,625
- --------------------------------------------------------------------------------
Boyd Gaming Corp., 8.75% Sr. Sub. Nts.,
4/15/12 3,000,000 3,273,750
- --------------------------------------------------------------------------------
Carrols Corp., 9% Sr. Sub. Nts., 1/15/13 4 770,000 783,475
- --------------------------------------------------------------------------------
Domino's, Inc., 8.25% Sr. Unsec. Sub. Nts.,
7/1/11 1,932,000 2,067,240
- --------------------------------------------------------------------------------
Gaylord Entertainment Co., 8% Sr. Nts.,
11/15/13 1,000,000 1,056,250
- --------------------------------------------------------------------------------
Intrawest Corp., 7.50% Sr. Unsec. Nts.,
10/15/13 2,666,000 2,749,313
- --------------------------------------------------------------------------------
Isle of Capri Casinos, Inc.:
7% Sr. Unsec. Sub. Nts., 3/1/14 4,750,000 4,797,500
9% Sr. Sub. Nts., 3/15/12 2,200,000 2,403,500
- --------------------------------------------------------------------------------
John Q. Hammons Hotels, Inc., 8.875% Sr.
Nts., Series B, 5/15/12 3,150,000 3,449,250
- --------------------------------------------------------------------------------
La Quinta Properties, Inc., 7% Sr. Sec. Nts.,
8/15/12 1,300,000 1,350,375
- --------------------------------------------------------------------------------
Mandalay Resort Group, 9.375% Sr. Sub. Nts.,
2/15/10 3,532,558 3,965,296
- --------------------------------------------------------------------------------
MGM Mirage, Inc.:
8.375% Sr. Unsec. Sub. Nts., 2/1/11 6,100,000 6,679,500
9.75% Sr. Unsec. Sub. Nts., 6/1/07 2,000,000 2,177,500
- --------------------------------------------------------------------------------
Mohegan Tribal Gaming Authority:
6.125% Sr. Nts., 2/15/13 4 1,240,000 1,258,600
6.375% Sr. Sub. Nts., 7/15/09 2,200,000 2,255,000
6.875% Sr. Sub. Nts., 2/15/15 4 1,735,000 1,782,713
8% Sr. Sub. Nts., 4/1/12 2,050,000 2,203,750
- --------------------------------------------------------------------------------
NCL Corp., 11.625% Sr. Nts., 7/15/14 4 2,700,000 2,855,250
- --------------------------------------------------------------------------------
Park Place Entertainment Corp.:
7.875% Sr. Sub. Nts., 3/15/10 3,700,000 4,162,500
9.375% Sr. Unsec. Sub. Nts., 2/15/07 950,000 1,023,625
- --------------------------------------------------------------------------------
Penn National Gaming, Inc.:
6.75% Sr. Sub. Nts., 3/1/15 4 1,235,000 1,231,913
6.875% Sr. Sub. Nts., 12/1/11 900,000 927,000
8.875% Sr. Sub. Nts., 3/15/10 900,000 967,500
- --------------------------------------------------------------------------------
Pinnacle Entertainment, Inc., 8.25% Sr.
Unsec. Sub. Nts., 3/15/12 5,800,000 6,061,000
- --------------------------------------------------------------------------------
Royal Caribbean Cruises Ltd., 8.75% Sr.
Unsub. Nts., 2/2/11 2,600,000 3,009,500
- --------------------------------------------------------------------------------
Six Flags, Inc.:
8.875% Sr. Unsec. Nts., 2/1/10 2,100,000 2,058,000
9.625% Sr. Nts., 6/1/14 2,147,000 2,018,180
9.75% Sr. Nts., 4/15/13 6,400,000 6,072,000
- --------------------------------------------------------------------------------
Starwood Hotels & Resorts Worldwide, Inc.,
7.875% Sr. Nts., 5/1/12 3,550,000 4,020,375
- --------------------------------------------------------------------------------
Station Casinos, Inc.:
6.50% Sr. Unsec. Sub. Nts., 2/1/14 5,300,000 5,432,500
9.875% Sr. Unsec. Sub. Nts., 7/1/10 2,025,000 2,099,986
- --------------------------------------------------------------------------------
Sun International Hotels Ltd., 8.875% Sr.
Unsec. Sub. Nts., 8/15/11 3,200,000 3,440,000
- --------------------------------------------------------------------------------
Universal City Development Partners Ltd.,
11.75% Sr. Nts., 4/1/10 2,700,000 3,111,750
- --------------------------------------------------------------------------------
Vail Resorts, Inc., 6.75% Sr. Sub. Nts.,
2/15/14 2,700,000 2,754,000
21 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE Continued
Wynn Las Vegas LLC/Wynn Las Vegas
Capital Corp.:
6.625% Nts., 12/1/14 4 $ 6,800,000 $ 6,647,000
6.625% Nts., 12/1/14 1,700,000 1,661,750
----------------
106,259,266
- --------------------------------------------------------------------------------
HOUSEHOLD DURABLES--2.4%
Beazer Homes USA, Inc., 8.375% Sr. Nts.,
4/15/12 3,300,000 3,555,750
- --------------------------------------------------------------------------------
Blount, Inc., 8.875% Sr. Sub. Nts.,
8/1/12 2,525,000 2,714,375
- --------------------------------------------------------------------------------
D.R. Horton, Inc., 9.75% Sr. Sub. Nts.,
9/15/10 800,000 940,594
- --------------------------------------------------------------------------------
K. Hovnanian Enterprises, Inc.:
7.75% Sr. Unsec. Sub. Nts., 5/15/13 2,250,000 2,351,250
8.875% Sr. Sub. Nts., 4/1/12 1,500,000 1,631,250
- --------------------------------------------------------------------------------
KB Home:
8.625% Sr. Sub. Nts., 12/15/08 2,750,000 2,995,088
9.50% Sr. Unsec. Sub. Nts., 2/15/11 2,000,000 2,149,000
- --------------------------------------------------------------------------------
Meritage Homes Corp., 6.25% Sr. Unsec.
Nts., 3/15/15 1,115,000 1,042,525
- --------------------------------------------------------------------------------
Sealy Mattress Co., 8.25% Sr. Sub. Nts.,
6/15/14 3,200,000 3,248,000
- --------------------------------------------------------------------------------
Standard Pacific Corp., 9.25% Sr. Sub.
Nts., 4/15/12 1,200,000 1,326,000
- --------------------------------------------------------------------------------
Toll Corp., 8.25% Sr. Sub. Nts., 12/1/11 1,750,000 1,890,000
- --------------------------------------------------------------------------------
WCI Communities, Inc.:
9.125% Sr. Sub. Nts., 5/1/12 1,100,000 1,160,500
10.625% Sr. Unsec. Sub. Nts., 2/15/11 4,600,000 4,991,000
- --------------------------------------------------------------------------------
William Lyon Homes, Inc., 10.75% Sr.
Nts., 4/1/13 2,500,000 2,725,000
- --------------------------------------------------------------------------------
Williams Scotsman, Inc., 9.875% Sr.
Unsec. Nts., 6/1/07 4,100,000 4,120,500
----------------
36,840,832
- --------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--0.1%
Leslie's Poolmart, Inc., 7.75% Sr.
Unsec. Nts., 2/1/13 1,375,000 1,395,625
- --------------------------------------------------------------------------------
MEDIA--11.5%
Adelphia Communications Corp.:
8.125% Sr. Nts., Series B, 7/15/03 2,3 2,000,000 1,740,000
8.375% Sr. Nts., Series B, 2/1/08 2,3 2,700,000 2,362,500
9.875% Sr. Nts., Series B, 3/1/07 2,3 2,200,000 1,919,500
10.25% Sr. Unsec. Nts., 11/1/06 2,3 1,600,000 1,368,000
10.25% Sr. Unsec. Sub. Nts., 6/15/11 2,3 1,200,000 1,083,000
10.875% Sr. Unsec. Nts., 10/1/10 2,3 1,500,000 1,312,500
- --------------------------------------------------------------------------------
Allbritton Communications Co., 7.75% Sr.
Unsec. Sub. Nts., 12/15/12 2,100,000 2,079,000
- --------------------------------------------------------------------------------
AMC Entertainment, Inc.:
8% Sr. Unsec. Sub. Nts., 3/1/14 3,300,000 2,945,250
9.50% Sr. Unsec. Sub. Nts., 2/1/11 5,299,000 5,226,139
- --------------------------------------------------------------------------------
American Media Operations, Inc.:
8.875% Sr. Unsec. Sub. Nts., 1/15/11 3,450,000 3,286,125
10.25% Sr. Unsec. Sub. Nts., Series B,
5/1/09 1,350,000 1,356,750
22 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
Block Communications, Inc., 9.25% Sr. Sub.
Nts., 4/15/09 $ 1,100,000 $ 1,177,000
- --------------------------------------------------------------------------------
Cablevision Systems Corp., 8% Sr. Unsec.
Nts., Series B, 4/15/12 3,400,000 3,349,000
- --------------------------------------------------------------------------------
Callahan Nordrhein-Westfalen GmbH, 14.125%
Sr. Nts., 7/15/11 1,2,3 [EUR] 1,000,000 121,016
- --------------------------------------------------------------------------------
Carmike Cinemas, Inc., 7.50% Sr. Sub.
Nts., 2/15/14 2,100,000 1,913,625
- --------------------------------------------------------------------------------
CBD Media LLC/CBD Finance, Inc., 8.625%
Sr. Sub. Nts., 6/1/11 700,000 724,500
- --------------------------------------------------------------------------------
Charter Communications Holdings II LLC,
10.25% Sr. Unsec. Nts., 9/15/10 2,300,000 2,337,375
- --------------------------------------------------------------------------------
Charter Communications Holdings
LLC/Charter Communications
Holdings Capital Corp.:
0%/11.75% Sr. Unsec. Sub. Disc. Nts.,
5/15/11 5 12,700,000 8,477,250
8.375% Sr. Nts., Second Lien, 4/30/14 4 12,100,000 12,100,000
- --------------------------------------------------------------------------------
Cinemark USA, Inc., 9% Sr. Unsec. Sub.
Nts., 2/1/13 1,800,000 1,858,500
- --------------------------------------------------------------------------------
Cinemark, Inc., 0%/9.75% Sr. Unsec. Disc.
Nts., 3/15/14 5 5,700,000 3,819,000
- --------------------------------------------------------------------------------
Corus Entertainment, Inc., 8.75% Sr. Sub.
Nts., 3/1/12 1,500,000 1,616,250
- --------------------------------------------------------------------------------
Dex Media East LLC/Dex Media East Finance
Co., 9.875% Sr. Unsec. Nts., 11/15/09 3,000,000 3,322,500
- --------------------------------------------------------------------------------
Dex Media West LLC/Dex Media West Finance
Co.:
5.875% Sr. Nts., 11/15/11 1,000,000 992,500
8.50% Sr. Nts., 8/15/10 2,100,000 2,299,500
9.875% Sr. Sub. Nts., 8/15/13 3,516,000 4,025,820
- --------------------------------------------------------------------------------
Dex Media, Inc., 8% Unsec. Nts., 11/15/13 13,125,000 14,010,938
- --------------------------------------------------------------------------------
DirecTV Holdings LLC/DirecTV Financing
Co., Inc., 8.375% Sr. Unsec. Nts., 3/15/13 3,904,000 4,343,200
- --------------------------------------------------------------------------------
EchoStar DBS Corp., 6.625% Sr. Unsec.
Nts., 10/1/14 5,350,000 5,309,875
- --------------------------------------------------------------------------------
Emmis Operating Co., 6.875% Sr. Unsec.
Sub. Nts., 5/15/12 2,700,000 2,686,500
- --------------------------------------------------------------------------------
Entercom Radio LLC/Entercom Capital, Inc.,
7.625% Sr. Unsec. Sub. Nts., 3/1/14 1,500,000 1,571,250
- --------------------------------------------------------------------------------
Entravision Communications Corp., 8.125%
Sr. Sub. Nts., 3/15/09 1,400,000 1,464,750
- --------------------------------------------------------------------------------
Granite Broadcasting Corp., 9.75% Sr. Sec.
Nts., 12/1/10 5,247,000 4,905,945
- --------------------------------------------------------------------------------
Gray Television, Inc., 9.25% Sr. Sub.
Nts., 12/15/11 1,750,000 1,907,500
- --------------------------------------------------------------------------------
Lamar Media Corp., 7.25% Sr. Unsec. Sub.
Nts., 1/1/13 1,000,000 1,060,000
- --------------------------------------------------------------------------------
Liberty Media Corp., 5.70% Sr. Unsec.
Nts., 5/15/13 1,250,000 1,164,425
- --------------------------------------------------------------------------------
Liberty Media Group, 8.50% Debs., 7/15/29 1,250,000 1,266,135
- --------------------------------------------------------------------------------
Lin Television Corp., 6.50% Sr. Sub. Nts.,
5/15/13 1,800,000 1,719,000
- --------------------------------------------------------------------------------
LodgeNet Entertainment Corp., 9.50% Sr.
Sub. Debs., 6/15/13 1,350,000 1,478,250
- --------------------------------------------------------------------------------
Mediacom LLC/Mediacom Capital Corp., 9.50%
Sr. Unsec. Nts., 1/15/13 5,147,000 5,159,868
- --------------------------------------------------------------------------------
MediaNews Group, Inc.:
6.375% Sr. Sub. Nts., 4/1/14 4,700,000 4,529,625
6.875% Sr. Unsec. Sub. Nts., 10/1/13 700,000 697,375
- --------------------------------------------------------------------------------
News America Holdings, Inc., 8.875% Sr.
Debs., 4/26/23 400,000 523,974
- --------------------------------------------------------------------------------
PanAmSat Corp., 9% Sr. Unsec. Nts., 8/15/14 3,770,000 4,132,863
23 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
MEDIA Continued
PRIMEDIA, Inc.:
8% Sr. Nts., 5/15/13 $ 3,400,000 $ 3,425,500
8.875% Sr. Unsec. Nts., 5/15/11 147,000 154,718
- --------------------------------------------------------------------------------
R.H. Donnelley Corp., 6.875% Sr. Nts.,
1/15/13 4 1,500,000 1,537,500
- --------------------------------------------------------------------------------
R.H. Donnelley Financial Corp. I:
8.875% Sr. Nts., 12/15/10 4 2,600,000 2,853,500
10.875% Sr. Sub. Nts., 12/15/12 4 3,900,000 4,553,250
- --------------------------------------------------------------------------------
Radio One, Inc., 8.875% Sr. Unsec. Sub.
Nts., Series B, 7/1/11 1,950,000 2,103,563
- --------------------------------------------------------------------------------
Rainbow National Services LLC, 8.75% Sr.
Nts., 9/1/12 4 2,000,000 2,195,000
- --------------------------------------------------------------------------------
Sinclair Broadcast Group, Inc.:
8% Sr. Unsec. Sub. Nts., 3/15/12 6,050,000 6,231,500
8.75% Sr. Sub. Nts., 12/15/11 1,250,000 1,318,750
- --------------------------------------------------------------------------------
Spanish Broadcasting System, Inc.,
9.625% Sr. Unsec. Sub. Nts., 11/1/09 5,000,000 5,256,250
- --------------------------------------------------------------------------------
Vertis, Inc.:
9.75% Sr. Sec. Nts., 4/1/09 2,050,000 2,142,250
10.875% Sr. Unsec. Nts., Series B,
6/15/09 2,400,000 2,304,000
- --------------------------------------------------------------------------------
Weekly Reader Corp./CompassLearning,
Inc./ WRC Media, Inc.,
12.75% Sr. Sub. Nts., 11/15/09 4,000,000 4,255,000
- --------------------------------------------------------------------------------
WMG Holdings Corp., 0%/9.50% Sr. Disc.
Nts., 12/15/14 4,5 6,427,000 4,466,765
----------------
173,541,619
- --------------------------------------------------------------------------------
SPECIALTY RETAIL--1.0%
Asbury Automotive Group, Inc., 9% Sr.
Sub. Nts., 6/15/12 1,400,000 1,438,500
- --------------------------------------------------------------------------------
Atlantic Broadband Finance LLC, 9.375%
Sr. Sub. Nts., 1/15/14 4 1,950,000 1,842,750
- --------------------------------------------------------------------------------
AutoNation, Inc., 9% Sr. Unsec. Nts.,
8/1/08 3,000,000 3,292,500
- --------------------------------------------------------------------------------
Boise Cascade LLC, 7.125% Sr. Sub. Nts.,
10/15/14 4 2,300,000 2,271,250
- --------------------------------------------------------------------------------
Finlay Fine Jewelry Corp., 8.375% Sr.
Unsec. Nts., 6/1/12 1,950,000 1,767,188
- --------------------------------------------------------------------------------
Just For Feet, Inc., 11% Sr. Sub. Nts.,
5/1/09 1,2,3 700,000 --
- --------------------------------------------------------------------------------
Petco Animal Supplies, Inc., 10.75% Sr.
Sub. Nts., 11/1/11 3,500,000 3,920,000
- --------------------------------------------------------------------------------
Rent-A-Center, Inc., 7.50% Sr. Unsec.
Sub. Nts., Series B, 5/1/10 1,100,000 1,105,500
----------------
15,637,688
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--1.0%
Invista, Inc., 9.25% Sr. Nts., 5/1/12 4 3,850,000 4,225,375
- --------------------------------------------------------------------------------
Levi Strauss & Co.:
7% Unsec. Nts., 11/1/06 2,350,000 2,361,750
7.73% Sr. Unsec. Unsub. Nts., 4/1/12 6 2,765,000 2,626,750
12.25% Sr. Nts., 12/15/12 2,800,000 3,073,000
- --------------------------------------------------------------------------------
Oxford Industries, Inc., 8.875% Sr.
Nts., 6/1/11 1,250,000 1,343,750
- --------------------------------------------------------------------------------
Russell Corp., 9.25% Sr. Nts., 5/1/10 1,500,000 1,590,000
----------------
15,220,625
24 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
CONSUMER STAPLES--3.6%
- --------------------------------------------------------------------------------
BEVERAGES--0.1%
Constellation Brands, Inc., 8.125% Sr.
Sub. Nts., 1/15/12 $ 2,000,000 $ 2,150,000
- --------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--0.7%
Great Atlantic & Pacific Tea Co., Inc.
(The), 9.125% Sr. Nts., 12/15/11 947,000 1,001,453
- --------------------------------------------------------------------------------
Jean Coutu Group (PJC), Inc. (The):
7.625% Sr. Unsec. Nts., 8/1/12 900,000 933,750
8.50% Sr. Sub. Nts., 8/1/14 4,500,000 4,466,250
- --------------------------------------------------------------------------------
Rite Aid Corp.:
8.125% Sr. Sec. Nts., 5/1/10 2,650,000 2,742,750
9.50% Sr. Sec. Nts., 2/15/11 1,600,000 1,712,000
----------------
10,856,203
- --------------------------------------------------------------------------------
FOOD PRODUCTS--2.1%
American Seafoods Group LLC, 10.125% Sr.
Sub. Nts., 4/15/10 3,500,000 3,753,750
- --------------------------------------------------------------------------------
Burns Philp Capital Property Ltd., 9.75%
Sr. Unsec. Sub. Nts., 7/15/12 1,450,000 1,566,000
- --------------------------------------------------------------------------------
Chiquita Brands International, Inc.,
7.50% Sr. Unsec. Nts., 11/1/14 900,000 841,500
- --------------------------------------------------------------------------------
Del Monte Corp.:
6.75% Sr. Sub. Nts., 2/15/15 4 930,000 953,250
8.625% Sr. Sub. Nts., 12/15/12 3,300,000 3,646,500
- --------------------------------------------------------------------------------
Doane Pet Care Co.:
9.75% Sr. Unsec. Sub. Nts., 5/15/07 1,600,000 1,564,000
10.75% Sr. Nts., 3/1/10 5,700,000 6,056,250
- --------------------------------------------------------------------------------
Dole Food Co., Inc.:
8.625% Sr. Nts., 5/1/09 1,909,000 2,042,630
8.875% Sr. Unsec. Nts., 3/15/11 475,000 509,438
- --------------------------------------------------------------------------------
Hines Nurseries, Inc., 10.25% Sr. Unsec.
Sub. Nts., 10/1/11 1,700,000 1,759,500
- --------------------------------------------------------------------------------
Pinnacle Foods Holding Corp., 8.25% Sr.
Sub. Nts., 12/1/13 750,000 675,000
- --------------------------------------------------------------------------------
Smithfield Foods, Inc.:
7.625% Sr. Unsec. Sub. Nts., 2/15/08 2,240,000 2,340,800
8% Sr. Nts., Series B, 10/15/09 400,000 434,000
- --------------------------------------------------------------------------------
Swift & Co., 10.125% Sr. Nts., 10/1/09 2,500,000 2,737,500
- --------------------------------------------------------------------------------
United Biscuits Finance plc, 10.625% Sr.
Sub. Nts., 4/15/11 1 [EUR] 2,000,000 2,523,174
----------------
31,403,292
- --------------------------------------------------------------------------------
HOUSEHOLD PRODUCTS--0.5%
Church & Dwight Co., Inc., 6% Sr. Unsec.
Sub. Nts., 12/15/12 1,800,000 1,827,000
- --------------------------------------------------------------------------------
Playtex Products, Inc.:
8% Sr. Sec. Nts., 3/1/11 2,500,000 2,684,375
9.375% Sr. Unsec. Sub. Nts., 6/1/11 3,500,000 3,701,250
----------------
8,212,625
25 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
PERSONAL PRODUCTS--0.1%
Elizabeth Arden, Inc., 7.75% Sr. Unsec.
Sub. Nts., 1/15/14 $ 1,250,000 $ 1,309,375
- --------------------------------------------------------------------------------
TOBACCO--0.1%
R.J. Reynolds Tobacco Holdings, Inc.,
6.50% Nts., 7/15/10 4 1,240,000 1,243,100
- --------------------------------------------------------------------------------
ENERGY--6.8%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--0.8%
Dresser, Inc., 9.375% Sr. Sub. Nts.,
4/15/11 1,200,000 1,269,000
- --------------------------------------------------------------------------------
Grant Prideco, Inc., 9% Sr. Unsec. Nts.,
12/15/09 1,500,000 1,650,000
- --------------------------------------------------------------------------------
Hanover Compressor Co., 8.625% Sr. Nts.,
12/15/10 2,500,000 2,656,250
- --------------------------------------------------------------------------------
Hanover Equipment Trust 2001A, 8.50% Sr.
Sec. Nts., Series A, 9/1/08 1,500,000 1,567,500
- --------------------------------------------------------------------------------
Petroleum Helicopters, Inc., 9.375% Sr.
Nts., 5/1/09 1,500,000 1,586,250
- --------------------------------------------------------------------------------
Universal Compression, Inc., 7.25% Sr.
Unsec. Sub. Nts., 5/15/10 2,500,000 2,625,000
----------------
11,354,000
- --------------------------------------------------------------------------------
OIL & GAS--6.0%
ANR Pipeline Co., 8.875% Sr. Nts.,
3/15/10 1,400,000 1,542,699
- --------------------------------------------------------------------------------
Chesapeake Energy Corp.:
6.375% Sr. Nts., 6/15/15 4 1,400,000 1,442,000
6.875% Sr. Unsec. Nts., 1/15/16 784,000 821,240
- --------------------------------------------------------------------------------
Delta Petroleum Corp., 7% Sr. Nts.,
4/1/15 4 755,000 713,475
- --------------------------------------------------------------------------------
El Paso Corp., 7.875% Sr. Unsec. Nts.,
6/15/12 5,152,000 5,332,320
- --------------------------------------------------------------------------------
El Paso Energy Corp., 7.625% Nts.,
7/15/11 1,600,000 1,620,000
- --------------------------------------------------------------------------------
El Paso Production Holding Co., 7.75%
Sr. Unsec. Nts., 6/1/13 7,450,000 7,990,125
- --------------------------------------------------------------------------------
Forest Oil Corp., 7.75% Sr. Nts., 5/1/14 2,000,000 2,160,000
- --------------------------------------------------------------------------------
Frontier Oil Corp., 6.625% Sr. Unsec.
Nts., 10/1/11 1,100,000 1,138,500
- --------------------------------------------------------------------------------
Newfield Exploration Co.:
6.625% Sr. Unsec. Sub. Nts., 9/1/14 3,200,000 3,368,000
8.375% Sr. Sub. Nts., 8/15/12 2,850,000 3,127,875
- --------------------------------------------------------------------------------
Plains Exploration & Production Co.,
7.125% Sr. Nts., 6/15/14 1,700,000 1,827,500
- --------------------------------------------------------------------------------
Premcor Refining Group, Inc.:
6.75% Sr. Nts., 5/1/14 3,000,000 3,247,500
9.50% Sr. Nts., 2/1/13 2,000,000 2,310,000
- --------------------------------------------------------------------------------
Range Resources Corp.:
6.375% Sr. Sub. Nts., 3/15/15 1,125,000 1,125,000
7.375% Sr. Sub. Nts., 7/15/13 1,500,000 1,605,000
- --------------------------------------------------------------------------------
Southern Natural Gas Co.:
7.35% Nts., 2/15/31 2,800,000 2,992,590
8% Sr. Unsub. Nts., 3/1/32 4,800,000 5,483,006
8.875% Sr. Nts., 3/15/10 1,800,000 1,983,470
- --------------------------------------------------------------------------------
Stone Energy Corp.:
6.75% Sr. Unsec. Sub. Nts., 12/15/14 980,000 957,950
8.25% Sr. Unsec. Sub. Nts., 12/15/11 3,500,000 3,683,750
- --------------------------------------------------------------------------------
Teekay Shipping Corp., 8.875% Sr. Nts.,
7/15/11 3,175,000 3,639,344
26 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
OIL & GAS Continued
Tennessee Gas Pipeline Co., 7.50% Bonds,
4/1/17 $ 11,550,000 $ 12,851,154
- --------------------------------------------------------------------------------
Tesoro Petroleum Corp.:
8% Sr. Sec. Nts., 4/15/08 2,300,000 2,438,000
9.625% Sr. Sub. Nts., 4/1/12 1,597,000 1,774,666
- --------------------------------------------------------------------------------
Transcontinental Gas Pipe Line Corp.,
8.875% Sr. Unsub. Nts., Series B, 7/15/12 1,200,000 1,434,000
- --------------------------------------------------------------------------------
Whiting Petroleum Corp., 7.25% Sr. Sub.
Nts., 5/1/12 3,300,000 3,399,000
- --------------------------------------------------------------------------------
Williams Cos., Inc. (The):
7.125% Nts., 9/1/11 2,700,000 2,929,500
7.625% Nts., 7/15/19 100,000 113,000
8.75% Unsec. Nts., 3/15/32 6,400,000 7,720,000
- --------------------------------------------------------------------------------
Williams Holdings of Delaware, Inc.,
6.50% Nts., 12/1/08 1 800,000 838,000
----------------
91,608,664
- --------------------------------------------------------------------------------
FINANCIALS--3.0%
- --------------------------------------------------------------------------------
CAPITAL MARKETS--0.6%
American Color Graphics, Inc., 10% Sr.
Sec. Nts., 6/15/10 1,350,000 978,750
- --------------------------------------------------------------------------------
Berry Plastics Corp., 10.75% Sr. Sub.
Nts., 7/15/12 6,100,000 6,687,125
- --------------------------------------------------------------------------------
DeCrane Aircraft Holdings, Inc., 12% Sr.
Unsec. Sub. Nts., Series B, 9/30/08 1 3,700,000 1,480,000
----------------
9,145,875
- --------------------------------------------------------------------------------
COMMERCIAL BANKS--0.2%
ABN Amro Bank NV (NY Branch), 4% Sec. Nts.,
11/5/17 1,6 2,069,459 1,893,555
- --------------------------------------------------------------------------------
Bank Plus Corp., 12% Sr. Nts., 7/18/07 1 78,000 83,850
- --------------------------------------------------------------------------------
Western Financial Bank, 9.625% Unsec.
Sub. Debs., 5/15/12 1,700,000 1,861,500
----------------
3,838,905
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--1.0%
Affinia Group, Inc., 9% Sr. Sub. Nts.,
11/30/14 4 1,600,000 1,352,000
- --------------------------------------------------------------------------------
American Commercial Lines LLC/American
Commercial Lines Finance
Corp., 9.50% Sr. Nts., 2/15/15 4 1,005,000 1,065,300
- --------------------------------------------------------------------------------
Crystal US Holdings 3 LLC/Crystal US Sub
3 Corp.:
0%/10.50% Sr. Unsec. Disc. Nts., Series
B, 10/1/14 5 3,100,000 2,170,000
9.625% Sr. Sub. Nts., 6/15/14 4,794,000 5,393,250
- --------------------------------------------------------------------------------
Global Cash Access LLC/Global Cash
Finance Corp., 8.75% Sr. Sub. Nts., 3/15/12 1,200,000 1,311,000
- --------------------------------------------------------------------------------
JSG Funding plc, 7.75% Sr. Sub. Nts.,
4/1/15 4 2,470,000 2,037,750
- --------------------------------------------------------------------------------
Universal City Florida:
7.96% Sr. Unsec. Nts., 5/1/10 6 775,000 807,938
8.375% Sr. Unsec. Nts., 5/1/10 900,000 942,750
----------------
15,079,988
27 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
INSURANCE--0.1%
Texas Gas Transmission Corp., 7.25% Debs.,
7/15/27 $ 1,000,000 $ 1,275,468
- --------------------------------------------------------------------------------
REAL ESTATE--1.1%
American Casino & Entertainment Properties
LLC, 7.85% Sr. Sec. Nts., 2/1/12 1,750,000 1,863,750
- --------------------------------------------------------------------------------
Felcor Lodging LP, 9% Sr. Nts., 6/1/11 2,552,000 2,800,820
- --------------------------------------------------------------------------------
HMH Properties, Inc., 7.875% Sr. Nts.,
Series B, 8/1/08 618,000 630,360
- --------------------------------------------------------------------------------
Host Marriott LP, 6.375% Sr. Nts., 3/15/15 4 2,580,000 2,567,100
- --------------------------------------------------------------------------------
MeriStar Hospitality Corp.:
9.125% Sr. Unsec. Nts., 1/15/11 2,797,000 2,950,835
10.50% Sr. Unsec. Nts., 6/15/09 2,700,000 2,902,500
- --------------------------------------------------------------------------------
Trustreet Properties, Inc., 7.50% Sr.
Nts., 4/1/15 4 2,215,000 2,275,913
----------------
15,991,278
- --------------------------------------------------------------------------------
HEALTH CARE--6.5%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--0.1%
Titan Petrochemicals Group Ltd., 8.50% Sr.
Unsec. Nts., 3/18/12 4 2,120,000 1,939,800
- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--0.4%
Inverness Medical Innovations, Inc., 8.75%
Sr. Sub. Nts., 2/15/12 1,100,000 1,097,250
- --------------------------------------------------------------------------------
Sybron Dental Specialties, Inc., 8.125%
Sr. Sub. Nts., 6/15/12 2,200,000 2,365,000
- --------------------------------------------------------------------------------
Universal Hospital Services, Inc., 10.125%
Sr. Unsec. Nts., 11/1/11 2,150,000 2,182,250
----------------
5,644,500
- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--5.8%
Alderwoods Group, Inc., 7.75% Sr. Nts.,
9/15/12 4 2,800,000 2,985,500
- --------------------------------------------------------------------------------
AmeriPath, Inc., 10.50% Sr. Unsec. Sub.
Nts., 4/1/13 2,000,000 2,035,000
- --------------------------------------------------------------------------------
Beverly Enterprises, Inc., 7.875% Sr. Sub.
Nts., 6/15/14 2,300,000 2,518,500
- --------------------------------------------------------------------------------
Community Health Systems, Inc., 6.50% Sr.
Unsec. Sub. Nts., 12/15/12 2,400,000 2,454,000
- --------------------------------------------------------------------------------
Coventry Health Care, Inc., 6.125% Sr.
Unsec. Nts., 1/15/15 1 1,065,000 1,088,963
- --------------------------------------------------------------------------------
DaVita, Inc.:
6.625% Sr. Nts., 3/15/13 4 2,320,000 2,407,000
7.25% Sr. Sub. Nts., 3/15/15 4 2,030,000 2,095,975
- --------------------------------------------------------------------------------
Extendicare Health Services, Inc.:
6.875% Sr. Sub. Nts., 5/1/14 600,000 598,500
9.50% Sr. Unsec. Sub. Nts., 7/1/10 1,900,000 2,061,500
- --------------------------------------------------------------------------------
Fresenius Medical Care Capital Trust II,
7.875% Nts., 2/1/08 2,800,000 2,933,000
- --------------------------------------------------------------------------------
Genesis HealthCare Corp., 8% Sr. Sub.
Nts., 10/15/13 1,300,000 1,413,750
- --------------------------------------------------------------------------------
HCA, Inc.:
6.30% Sr. Unsec. Nts., 10/1/12 1,200,000 1,234,781
6.375% Nts., 1/15/15 8,350,000 8,684,902
7.875% Sr. Nts., 2/1/11 1,000,000 1,102,789
8.75% Sr. Nts., 9/1/10 2,000,000 2,283,020
28 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES Continued
HealthSouth Corp.:
7.625% Nts., 6/1/12 $ 3,950,000 $ 3,851,250
8.375% Unsec. Nts., 10/1/11 1,440,000 1,436,400
10.75% Sr. Unsec. Sub. Nts., 10/1/08 1,697,000 1,773,365
- --------------------------------------------------------------------------------
Magellan Health Services, Inc.,
9.375% Sr. Unsec. Nts., Series A, 11/15/08 4,435,654 4,746,150
- --------------------------------------------------------------------------------
Medquest, Inc., 11.875% Sr. Unsec. Sub.
Nts., Series B, 8/15/12 3,200,000 3,040,000
- --------------------------------------------------------------------------------
National Nephrology Assn., 9% Sr. Sub.
Nts., 11/1/11 4 650,000 732,875
- --------------------------------------------------------------------------------
NDCHealth Corp., 10.50% Sr. Unsec. Sub.
Nts., 12/1/12 4,100,000 4,376,750
- --------------------------------------------------------------------------------
PacifiCare Health Systems, Inc., 10.75%
Sr. Unsec. Unsub. Nts., 6/1/09 2,207,000 2,438,735
- --------------------------------------------------------------------------------
Psychiatric Solutions, Inc., 7.75% Sr.
Sub. Nts., 7/15/15 4 1,220,000 1,224,575
- --------------------------------------------------------------------------------
Quintiles Transnational Corp.,
10% Sr. Sub. Nts., 10/1/13 1,900,000 2,090,000
- --------------------------------------------------------------------------------
Rotech Healthcare, Inc., 9.50% Sr. Unsec.
Sub. Nts., 4/1/12 2,400,000 2,580,000
- --------------------------------------------------------------------------------
Select Medical Corp., 7.625% Sr. Sub.
Nts., 2/1/15 4 2,650,000 2,636,750
- --------------------------------------------------------------------------------
Tenet Healthcare Corp.:
6.375% Sr. Nts., 12/1/11 2,620,000 2,508,650
7.375% Nts., 2/1/13 147,000 145,898
9.875% Sr. Nts., 7/1/14 4,875,000 5,252,813
- --------------------------------------------------------------------------------
Triad Hospitals, Inc.:
7% Sr. Nts., 5/15/12 2,400,000 2,514,000
7% Sr. Sub. Nts., 11/15/13 5,210,000 5,379,325
- --------------------------------------------------------------------------------
US Oncology, Inc.:
9% Sr. Unsec. Nts., 8/15/12 2,150,000 2,311,250
10.75% Sr. Unsec. Sub. Nts., 8/15/14 2,550,000 2,792,250
----------------
87,728,216
- --------------------------------------------------------------------------------
PHARMACEUTICALS--0.2%
Valeant Pharmaceuticals International,
Inc., 7% Sr. Nts., 12/15/11 2,900,000 2,856,500
- --------------------------------------------------------------------------------
INDUSTRIALS--8.0%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.3%
Alliant Techsystems, Inc., 8.50% Sr.
Unsec. Sub. Nts., 5/15/11 2,400,000 2,574,000
- --------------------------------------------------------------------------------
BE Aerospace, Inc.:
8% Sr. Unsec. Sub. Nts., Series B, 3/1/08 2,900,000 2,914,500
8.50% Sr. Unsec. Nts., 10/1/10 1,100,000 1,221,000
8.875% Sr. Unsec. Sub. Nts., 5/1/11 147,000 154,350
- --------------------------------------------------------------------------------
L-3 Communications Corp.:
5.875% Sr. Sub. Nts., 1/15/15 900,000 877,500
6.125% Sr. Unsec. Sub. Nts., 1/15/14 1,350,000 1,356,750
7.625% Sr. Sub. Nts., 6/15/12 1,250,000 1,337,500
- --------------------------------------------------------------------------------
Rexnord Corp., 10.125% Sr. Unsec. Sub.
Nts., 12/15/12 1,900,000 2,090,000
- --------------------------------------------------------------------------------
TD Funding Corp., 8.375% Sr.
Sub. Nts., 7/15/11 2,800,000 2,982,000
- --------------------------------------------------------------------------------
TRW Automotive, Inc.:
9.375% Sr. Nts., 2/15/13 1,517,000 1,687,663
11% Sr. Sub. Nts., 2/15/13 1,299,000 1,500,345
29 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE Continued
Vought Aircraft Industries, Inc.,
8% Sr. Nts., 7/15/11 $ 1,050,000 $ 1,044,750
----------------
19,740,358
- --------------------------------------------------------------------------------
AIRLINES--0.3%
AMR Corp., 9% Debs., 8/1/12 2,000,000 1,580,000
- --------------------------------------------------------------------------------
ATA Holdings Corp.:
12.125% Sr. Unsec. Unsub. Nts.,
6/15/10 2,3 2,000,000 390,000
13% Sr. Unsec. Nts., 2/1/09 2,3 6,720,000 1,310,400
- --------------------------------------------------------------------------------
Northwest Airlines Corp., 10% Sr.
Unsec. Nts., 2/1/09 3,850,000 1,694,000
----------------
4,974,400
- --------------------------------------------------------------------------------
BUILDING PRODUCTS--0.5%
Associated Materials, Inc., 9.75%
Sr. Sub. Nts., 4/15/12 1,500,000 1,560,000
- --------------------------------------------------------------------------------
Goodman Global Holding Co., Inc.,
7.875% Sr. Sub. Nts., 12/15/12 4 1,150,000 1,069,500
- --------------------------------------------------------------------------------
Jacuzzi Brands, Inc., 9.625% Sr.
Sec. Nts., 7/1/10 1,944,000 2,138,400
- --------------------------------------------------------------------------------
Nortek, Inc., 8.50% Sr. Unsec.
Unsub. Nts., 9/1/14 1,550,000 1,449,250
- --------------------------------------------------------------------------------
North America Energy Partners,
Inc., 8.75% Sr. Unsec. Nts., 12/1/11 1,300,000 1,124,500
----------------
7,341,650
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--1.8%
Allied Waste North America, Inc.:
7.25% Sr. Nts., 3/15/15 4 850,000 826,625
7.375% Sr. Sec. Nts., Series B, 4/15/14 11,000,000 10,230,000
8.875% Sr. Nts., Series B, 4/1/08 1,700,000 1,793,500
- --------------------------------------------------------------------------------
American Pad & Paper Co., 13% Sr.
Sub. Nts., Series B, 11/15/05 1,2,3 2,500,000 --
- --------------------------------------------------------------------------------
Cenveo Corp., 7.875% Sr. Sub. Nts.,
12/1/13 4,300,000 4,106,500
- --------------------------------------------------------------------------------
Comforce Operating, Inc., 12% Sr.
Nts., Series B, 12/1/07 2,400,000 2,412,000
- --------------------------------------------------------------------------------
Corrections Corp. of America:
6.25% Sr. Unsec. Sub. Nts., 3/15/13 2,200,000 2,194,500
7.50% Sr. Nts., 5/1/11 1,350,000 1,412,438
- --------------------------------------------------------------------------------
Mail-Well I Corp., 9.625% Sr. Nts.,
3/15/12 4,150,000 4,502,750
----------------
27,478,313
- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.5%
Belden & Blake Corp., 8.75% Sec.
Nts., 7/15/12 3,175,000 3,127,375
- --------------------------------------------------------------------------------
Dayton Superior Corp., 13% Sr.
Unsec. Sub. Nts., 6/15/09 1,050,000 929,250
- --------------------------------------------------------------------------------
General Cable Corp., 9.50% Sr.
Nts., 11/15/10 2,200,000 2,365,000
- --------------------------------------------------------------------------------
Tennessee Gas Pipeline Co., 7% Sr.
Unsec. Debs., 10/15/28 1,000,000 1,025,824
----------------
7,447,449
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.1%
Great Lakes Dredge & Dock Co.,
7.75% Sr. Unsec. Sub. Nts., 12/15/13 1,800,000 1,372,500
30 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
MACHINERY--1.6%
Case New Holland, Inc., 9.25% Sr. Nts.,
8/1/11 4 $ 1,300,000 $ 1,371,500
- --------------------------------------------------------------------------------
Douglas Dynamics LLC, 7.75% Sr. Nts.,
1/15/12 4 2,000,000 1,970,000
- --------------------------------------------------------------------------------
Greenbrier Cos., Inc. (The), 8.375% Sr.
Nts., 5/15/15 4 1,945,000 1,988,763
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The):
7.125% Sr. Nts., 11/1/13 600,000 630,000
10.50% Sr. Sub. Nts., 8/1/12 2,174,000 2,467,490
- --------------------------------------------------------------------------------
Milacron Escrow Corp., 11.50% Sr. Sec.
Nts., 5/15/11 4,700,000 4,958,500
- --------------------------------------------------------------------------------
Navistar International Corp., 7.50% Sr.
Nts., 6/15/11 2,800,000 2,870,000
- --------------------------------------------------------------------------------
NMHG Holding Co., 10% Sr. Nts., 5/15/09 1,600,000 1,688,000
- --------------------------------------------------------------------------------
Terex Corp.:
9.25% Sr. Unsec. Sub. Nts., 7/15/11 3,900,000 4,251,000
10.375% Sr. Unsec. Sub. Nts., Series B,
4/1/11 500,000 545,000
- --------------------------------------------------------------------------------
Trinity Industries, Inc., 6.50% Sr. Nts.,
3/15/14 1,950,000 1,950,000
----------------
24,690,253
- --------------------------------------------------------------------------------
MARINE--0.6%
CP Ships Ltd., 10.375% Sr. Nts., 7/15/12 5,000,000 5,625,000
- --------------------------------------------------------------------------------
Navigator Gas Transport plc, 10.50% First
Priority Ship Mtg. Nts., 6/30/07 1,2,3 3,324,000 2,908,500
- --------------------------------------------------------------------------------
WPO Shipholding Co. LLC, 12% Sr. Sec.
Nts., 7/15/05 1,2,3 5,000,000 28,000
----------------
8,561,500
- --------------------------------------------------------------------------------
ROAD & RAIL--0.5%
Kansas City Southern Railway Co. (The),
7.50% Sr. Nts., 6/15/09 2,000,000 2,075,000
- --------------------------------------------------------------------------------
Stena AB:
7% Sr. Unsec. Nts., 12/1/16 1,125,000 1,049,063
7.50% Sr. Unsec. Nts., 11/1/13 3,093,000 3,062,070
9.625% Sr. Nts., 12/1/12 2,000,000 2,190,000
----------------
8,376,133
- --------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--0.6%
United Rentals, Inc., 7% Sr. Sub. Nts.,
2/15/14 9,000,000 8,617,500
- --------------------------------------------------------------------------------
TRANSPORTATION INFRASTRUCTURE--0.2%
Horizon Lines LLC, 9% Nts., 11/1/12 4 2,300,000 2,420,750
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--3.7%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--0.7%
Lucent Technologies, Inc., 6.45% Unsec.
Debs., 3/15/29 7,500,000 6,750,000
- --------------------------------------------------------------------------------
Orion Network Systems, Inc., 12.50% Sr.
Unsub. Disc. Nts., 1/15/07 1,2,3 5,310,000 2,920,500
----------------
9,670,500
- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--0.1%
Seagate Technology Hdd Holdings, 8% Sr.
Nts., 5/15/09 1,700,000 1,816,875
31 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--1.1%
Flextronics International Ltd., 6.25% Sr.
Sub. Nts., 11/15/14 $ 4,750,000 $ 4,738,125
- --------------------------------------------------------------------------------
Ingram Micro, Inc., 9.875% Sr. Unsec. Sub.
Nts., 8/15/08 3,000,000 3,172,500
- --------------------------------------------------------------------------------
LCE Acquisition Corp., 9% Sr. Sub. Nts.,
8/1/14 4 3,175,000 3,087,688
- --------------------------------------------------------------------------------
Sanmina-SCI Corp., 6.75% Sub. Nts., 3/1/13 4 2,370,000 2,275,200
- --------------------------------------------------------------------------------
Sensus Metering System, Inc., 8.625% Sr.
Unsec. Sub. Nts., 12/15/13 4,200,000 3,927,000
---------------
17,200,513
- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--0.0%
Exodus Communications, Inc., 10.75% Sr.
Nts., 12/15/09 1,2,3 [EUR] 4,232,751 51,223
- --------------------------------------------------------------------------------
NorthPoint Communications Group, Inc.,
12.875% Nts., 2/15/10 1,2,3 1,040,900 --
- --------------------------------------------------------------------------------
PSINet, Inc., 10.50% Sr. Unsec. Nts.,
12/1/06 1,2,3 [EUR] 1,000,000 --
----------------
51,223
- --------------------------------------------------------------------------------
IT SERVICES--0.6%
DynCorp International LLC, 9.50% Sr. Sub.
Nts., 2/15/13 4 4,665,000 4,361,775
- --------------------------------------------------------------------------------
Iron Mountain, Inc., 8.625% Sr. Unsec. Sub.
Nts., 4/1/13 2,400,000 2,496,000
- --------------------------------------------------------------------------------
Titan Corp. (The), 8% Sr. Sub. Nts., 5/15/11 1,400,000 1,508,500
----------------
8,366,275
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT--1.2%
Advanced Micro Devices, Inc., 7.75% Sr.
Unsec. Nts., 11/1/12 5,450,000 5,395,500
- --------------------------------------------------------------------------------
Amkor Technology, Inc., 9.25% Sr. Unsec.
Sub. Nts., 2/15/08 3,500,000 3,377,500
- --------------------------------------------------------------------------------
Freescale Semiconductor, Inc., 7.125% Sr.
Unsec. Nts., 7/15/14 2,300,000 2,484,000
- --------------------------------------------------------------------------------
Huntsman International LLC, 7.375% Sr. Sub.
Nts., 1/1/15 4 6,350,000 6,302,375
- --------------------------------------------------------------------------------
MagnaChip Semiconductor Ltd., 8% Sr. Sub.
Nts., 12/15/14 4 586,000 565,490
----------------
18,124,865
- --------------------------------------------------------------------------------
MATERIALS--13.1%
- --------------------------------------------------------------------------------
CHEMICALS--4.0%
AEP Industries, Inc., 7.875% Sr. Nts.,
3/15/13 4 840,000 846,060
- --------------------------------------------------------------------------------
ClimaChem, Inc., 10.75% Sr. Unsec. Nts.,
Series B, 12/1/07 1 2,000,000 1,340,000
- --------------------------------------------------------------------------------
Compass Minerals Group, Inc., 10% Sr. Sub.
Nts., 8/15/11 895,000 980,025
- --------------------------------------------------------------------------------
Crompton Corp., 9.875% Sr. Nts., 8/1/12 2,800,000 3,262,000
- --------------------------------------------------------------------------------
Equistar Chemicals LP/Equistar Funding Corp.:
10.125% Sr. Unsec. Nts., 9/1/08 147,000 159,863
10.625% Sr. Unsec. Nts., 5/1/11 4,400,000 4,878,500
- --------------------------------------------------------------------------------
Huntsman Corp./ICI Chemical Co. plc,
10.125% Sr. Unsec. Sub. Nts., 7/1/09 5,572,000 5,760,055
- --------------------------------------------------------------------------------
Huntsman International LLC, 9.875% Sr.
Nts., 3/1/09 6,100,000 6,557,500
- --------------------------------------------------------------------------------
Huntsman LLC:
11.50% Sr. Unsec. Nts., 7/15/12 6 2,535,000 2,984,963
11.625% Sr. Unsec. Nts., 10/15/10 95,000 111,744
32 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
CHEMICALS Continued
IMC Global, Inc.:
7.625% Bonds, 11/1/05 1 $ 24,000 $ 24,360
10.875% Sr. Unsec. Nts., 8/1/13 147,000 173,093
10.875% Sr. Unsec. Nts., Series B, 6/1/08 46,000 51,980
- --------------------------------------------------------------------------------
Innophos, Inc., 8.875% Sr. Sub. Nts.,
8/15/14 4 3,300,000 3,382,500
- --------------------------------------------------------------------------------
ISP Chemco, Inc., 10.25% Sr. Unsec. Sub.
Nts., 7/1/11 2,700,000 2,956,500
- --------------------------------------------------------------------------------
ISP Holdings, Inc., 10.625% Sr. Sec. Nts.,
12/15/09 1,800,000 1,944,000
- --------------------------------------------------------------------------------
KI Holdings, Inc., 0%/9.875% Sr. Unsec. Sub.
Disc. Nts., 11/15/14 5 2,850,000 1,667,250
- --------------------------------------------------------------------------------
Lyondell Chemical Co.:
9.50% Sec. Nts., 12/15/08 147,000 157,106
9.50% Sr. Sec. Nts., 12/15/08 700,000 748,125
9.625% Sr. Sec. Nts., Series A, 5/1/07 2,500,000 2,681,250
9.875% Sec. Nts., Series B, 5/1/07 269,000 277,070
10.50% Sr. Sec. Nts., 6/1/13 1,250,000 1,435,938
11.125% Sr. Sec. Nts., 7/15/12 700,000 798,000
- --------------------------------------------------------------------------------
Millennium America, Inc., 9.25% Sr. Unsec.
Sub. Nts., 6/15/08 746,000 811,275
- --------------------------------------------------------------------------------
PCI Chemicals Canada, 10% Sr. Sec. Nts.,
12/31/08 989,550 1,053,871
- --------------------------------------------------------------------------------
Pioneer Cos., Inc., 6.99% Sr. Sec. Nts.,
12/31/06 6 43,239 43,455
- --------------------------------------------------------------------------------
PolyOne Corp.:
8.875% Sr. Unsec. Nts., 5/1/12 2,600,000 2,580,500
10.625% Sr. Unsec. Nts., 5/15/10 1,597,000 1,696,813
- --------------------------------------------------------------------------------
Resolution Performance Products LLC:
8% Sr. Sec. Nts., 12/15/09 1,650,000 1,724,250
13.50% Sr. Unsec. Sub. Nts., 11/15/10 1,350,000 1,458,000
- --------------------------------------------------------------------------------
Rhodia SA, 10.25% Sr. Unsec. Nts., 6/1/10 2,020,000 2,176,550
- --------------------------------------------------------------------------------
Rockwood Specialties Group, Inc.:
7.50% Sr. Sub. Nts., 11/15/14 4 1,000,000 997,500
10.625% Sr. Unsec. Sub. Nts., 5/15/11 950,000 1,052,125
- --------------------------------------------------------------------------------
Royster-Clark, Inc., 10.25% First Mtg. Nts.,
4/1/09 1 1,500,000 1,558,755
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc., 10% Sr. Sec. Nts.,
12/19/07 1,7 2,045,678 2,035,450
- --------------------------------------------------------------------------------
Westlake Chemical Corp., 8.75% Sr. Nts.,
7/15/11 844,000 922,070
----------------
61,288,496
- --------------------------------------------------------------------------------
CONSTRUCTION MATERIALS--0.4%
NTK Holdings, Inc., 0%/10.75% Sr. Disc.
Nts., 3/1/14 4,5 6,090,000 2,892,750
- --------------------------------------------------------------------------------
Texas Industries, Inc., 10.25% Sr. Unsec.
Nts., 6/15/11 2,600,000 3,025,750
----------------
5,918,500
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING--3.6%
Crown Euro Holdings SA:
9.50% Sr. Sec. Nts., 3/1/11 2,800,000 3,108,000
10.875% Sr. Sec. Nts., 3/1/13 1,400,000 1,652,000
33 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
CONTAINERS & PACKAGING Continued
Graham Packaging Co., Inc.:
8.50% Sr. Nts., 10/15/12 4 $ 1,200,000 $ 1,218,000
9.875% Sub. Nts., 10/15/14 4 2,400,000 2,418,000
- --------------------------------------------------------------------------------
Graphic Packaging International Corp.:
8.50% Sr. Nts., 8/15/11 3,300,000 3,415,500
9.50% Sr. Sub. Nts., 8/15/13 2,100,000 2,126,250
- --------------------------------------------------------------------------------
Jefferson Smurfit Corp.:
7.50% Sr. Unsec. Unsub. Nts., 6/1/13 650,000 624,000
8.25% Sr. Unsec. Nts., 10/1/12 2,500,000 2,525,000
- --------------------------------------------------------------------------------
MDP Acquisitions plc, 9.625% Sr. Nts.,
10/1/12 2,500,000 2,512,500
- --------------------------------------------------------------------------------
Owens-Brockway Glass Container, Inc.:
7.75% Sr. Sec. Nts., 5/15/11 700,000 747,250
8.25% Sr. Unsec. Nts., 5/15/13 1,347,000 1,469,914
8.75% Sr. Sec. Nts., 11/15/12 5,400,000 5,980,500
8.875% Sr. Sec. Nts., 2/15/09 3,000,000 3,202,500
- --------------------------------------------------------------------------------
Pliant Corp.:
11.125% Sr. Sec. Nts., 9/1/09 1,200,000 1,176,000
11.625% Sr. Sec. Nts., 6/15/09 4,7 1,404,123 1,509,432
- --------------------------------------------------------------------------------
Solo Cup Co., 8.50% Sr. Sub. Nts., 2/15/14 6,050,000 5,687,000
- --------------------------------------------------------------------------------
Stone Container Corp.:
8.375% Sr. Nts., 7/1/12 2,500,000 2,537,500
9.25% Sr. Unsec. Nts., 2/1/08 1,000,000 1,050,000
9.75% Sr. Unsec. Nts., 2/1/11 4,000,000 4,250,000
- --------------------------------------------------------------------------------
Stone Container Finance Co. of Canada II,
7.375% Sr. Unsec. Nts., 7/15/14 1,700,000 1,606,500
- --------------------------------------------------------------------------------
Tekni-Plex, Inc., 10.875% Sr. Sec. Nts.,
8/15/12 4 735,000 797,475
- --------------------------------------------------------------------------------
TriMas Corp., 9.875% Sr. Unsec. Sub. Nts.,
6/15/12 5,100,000 4,309,500
----------------
53,922,821
- --------------------------------------------------------------------------------
METALS & MINING--3.3%
AK Steel Corp.:
7.75% Sr. Unsec. Nts., 6/15/12 4,447,000 3,779,950
7.875% Sr. Unsec. Nts., 2/15/09 900,000 823,500
- --------------------------------------------------------------------------------
Arch Western Finance LLC, 6.75% Sr. Nts.,
7/1/13 2,650,000 2,749,375
- --------------------------------------------------------------------------------
California Steel Industries, Inc., 6.125%
Sr. Nts., 3/15/14 1,500,000 1,402,500
- --------------------------------------------------------------------------------
Century Aluminum Co., 7.50% Sr. Unsec.
Nts., 8/15/14 2,800,000 2,779,000
- --------------------------------------------------------------------------------
Foundation PA Coal Co., 7.25% Sr. Unsec.
Nts., 8/1/14 1,900,000 2,004,500
- --------------------------------------------------------------------------------
IMCO Recycling, Inc., 10.375% Sr. Sec.
Nts., 10/15/10 2,200,000 2,425,500
- --------------------------------------------------------------------------------
International Utility Structures, Inc., 13%
Unsec. Sub. Nts., 2/1/08 1,2,3 814,000 --
- --------------------------------------------------------------------------------
IPSCO, Inc., 8.75% Sr. Nts., 6/1/13 850,000 953,063
- --------------------------------------------------------------------------------
Ispat Inland ULC, 9.75% Sr. Sec. Nts.,
4/1/14 4,543,000 5,315,310
- --------------------------------------------------------------------------------
Jorgensen (Earle M.) Co., 9.75% Sr. Sec.
Nts., 6/1/12 2,500,000 2,712,500
- --------------------------------------------------------------------------------
Kaiser Aluminum & Chemical Corp., 10.875%
Sr. Nts., Series B, 10/15/06 2,3 2,000,000 1,830,000
- --------------------------------------------------------------------------------
Koppers Industry, Inc., 9.875% Sr. Sec.
Nts., 10/15/13 2,800,000 3,038,000
34 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
METALS & MINING Continued
Massey Energy Co., 6.625% Sr. Nts.,
11/15/10 $ 1,750,000 $ 1,811,250
- --------------------------------------------------------------------------------
Northwest Pipeline Corp., 8.125% Sr. Nts.,
3/1/10 850,000 926,500
- --------------------------------------------------------------------------------
Novelis, Inc., 7.25% Sr. Nts., 2/15/15 4 3,750,000 3,782,813
- --------------------------------------------------------------------------------
Oregon Steel Mills, Inc., 10% Sr. Nts.,
7/15/09 5,750,000 6,224,375
- --------------------------------------------------------------------------------
Peabody Energy Corp., 6.875% Sr. Unsec.
Nts., Series B, 3/15/13 2,500,000 2,662,500
- --------------------------------------------------------------------------------
Steel Dynamics, Inc., 9.50% Sr. Nts.,
3/15/09 1,500,000 1,601,250
- --------------------------------------------------------------------------------
UCAR Finance, Inc., 10.25% Sr. Nts.,
2/15/12 700,000 740,250
- --------------------------------------------------------------------------------
United States Steel Corp.:
9.75% Sr. Nts., 5/15/10 1,514,000 1,642,690
10.75% Sr. Nts., 8/1/08 1,493,000 1,664,695
----------------
50,869,521
- --------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS--1.8%
Abitibi-Consolidated, Inc., 8.55% Nts.,
8/1/10 1,250,000 1,309,375
- --------------------------------------------------------------------------------
Appleton Papers, Inc., 8.125% Sr. Nts.,
6/15/11 2,250,000 2,205,000
- --------------------------------------------------------------------------------
Buckeye Technologies, Inc., 8.50% Sr.
Nts., 10/1/13 1,000,000 1,025,000
- --------------------------------------------------------------------------------
Georgia-Pacific Corp.:
8.125% Sr. Unsec. Nts., 5/15/11 1,500,000 1,698,750
9.375% Sr. Unsec. Nts., 2/1/13 3,800,000 4,317,750
- --------------------------------------------------------------------------------
Inland Fiber Group LLC, 9.625% Sr. Unsec.
Nts., 11/15/07 1,2,3 5,400,000 2,403,000
- --------------------------------------------------------------------------------
JSG Holding plc, 11.50% Sr. Nts.,
10/1/15 4,7 [EUR] 774,809 754,800
- --------------------------------------------------------------------------------
Mercer International, Inc., 9.25% Sr.
Nts., 2/15/13 2,290,000 1,843,450
- --------------------------------------------------------------------------------
Norske Skog Canada Ltd., 7.375% Sr. Unsec.
Nts., 3/1/14 1,500,000 1,477,500
- --------------------------------------------------------------------------------
Tekni-Plex, Inc.:
8.75% Sr. Sec. Nts., 11/15/13 4 5,347,000 4,772,198
12.75% Sr. Unsec. Sub. Nts., Series B,
6/15/10 900,000 621,000
- --------------------------------------------------------------------------------
Tembec Industries, Inc.:
7.75% Sr. Nts., 3/15/12 2,800,000 2,072,000
8.50% Sr. Unsec. Nts., 2/1/11 147,000 114,293
- --------------------------------------------------------------------------------
Western Forest Products, Inc., 15% Sec.
Nts., 7/28/09 1,7 2,294,000 2,385,760
----------------
26,999,876
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--10.5%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--4.4%
American Tower Corp., 7.125% Sr. Unsec.
Nts., 10/15/12 1,500,000 1,593,750
- --------------------------------------------------------------------------------
Cincinnati Bell, Inc.:
7% Sr. Nts., 2/15/15 4 1,230,000 1,208,475
8.375% Sr. Sub. Nts., 1/15/14 4 970,000 999,100
- --------------------------------------------------------------------------------
Citizens Communications Co.:
6.25% Sr. Nts., 1/15/13 4 670,000 651,575
9.25% Sr. Nts., 5/15/11 600,000 672,750
- --------------------------------------------------------------------------------
Intelsat Bermuda Ltd., 8.625% Sr. Nts.,
1/15/15 4 5,135,000 5,443,100
35 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES
Continued
iPCS, Inc., 7/15/10, Escrow Shares 1 $ 1,350,000 $ --
- --------------------------------------------------------------------------------
Level 3 Communications, Inc., 9.125% Sr.
Unsec. Nts., 5/1/08 6,150,000 5,135,250
- --------------------------------------------------------------------------------
MCI, Inc.:
6.908% Sr. Unsec. Nts., 5/1/07 6 2,693,000 2,736,761
7.688% Sr. Unsec. Nts., 5/1/09 6 2,900,000 3,026,875
- --------------------------------------------------------------------------------
PanAmSat Holding Corp., 0%/10.375% Sr.
Unsec. Disc. Nts., 11/1/14 5 1,250,000 865,625
- --------------------------------------------------------------------------------
Pratama Datakom Asia BV, 12.75% Gtd. Nts.,
7/15/05 1,2,3 4,000,000 140,000
- --------------------------------------------------------------------------------
Qwest Capital Funding, Inc., 7.90% Unsec.
Nts., 8/15/10 4,272,000 4,272,000
- --------------------------------------------------------------------------------
Qwest Communications International, Inc.,
7.25% Sr. Unsec. Sub. Nts., 2/15/11 6 1,500,000 1,458,750
- --------------------------------------------------------------------------------
Qwest Corp.:
8.875% Nts., 3/15/12 4,6 4,200,000 4,588,500
8.875% Unsec. Unsub. Nts., 3/15/12 6 1,400,000 1,529,500
- --------------------------------------------------------------------------------
Qwest Services Corp.:
13.50% Sr. Sec. Sub. Nts., 12/15/10 17,300,000 20,068,000
14% Sr. Sec. Sub. Nts., 12/15/14 3,800,000 4,626,500
- --------------------------------------------------------------------------------
Teligent, Inc., 11.50% Sr. Nts.,
12/1/07 1,2,3 2,300,000 --
- --------------------------------------------------------------------------------
Time Warner Telecom Holdings, Inc., 9.25%
Sr. Nts., 2/15/14 4 3,195,000 3,099,150
- --------------------------------------------------------------------------------
Time Warner Telecom LLC/Time Warner
Telecom, Inc., 9.75% Sr. Nts., 7/15/08 1,800,000 1,818,000
- --------------------------------------------------------------------------------
Time Warner Telecom, Inc., 10.125% Sr.
Unsec. Sub. Nts., 2/1/11 1,150,000 1,155,750
- --------------------------------------------------------------------------------
Valor Telecommunications Enterprises LLC,
7.75% Sr. Nts., 2/15/15 4 1,370,000 1,352,875
----------------
66,442,286
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--6.1%
Alamosa Delaware, Inc.:
8.50% Sr. Nts., 1/31/12 2,750,000 2,897,813
11% Sr. Unsec. Nts., 7/31/10 147,000 165,559
12.50% Sr. Unsec. Nts., 2/1/11 2,200,000 2,497,000
- --------------------------------------------------------------------------------
American Cellular Corp., 10% Sr. Nts.,
Series B, 8/1/11 1,920,000 1,958,400
- --------------------------------------------------------------------------------
American Tower Corp., 7.50% Sr. Nts., 5/1/12 6,450,000 6,917,625
- --------------------------------------------------------------------------------
American Tower Escrow Corp., 12.25% Sr.
Sub. Disc. Nts., 8/1/08 8 4,300,000 3,321,750
- --------------------------------------------------------------------------------
AT&T Corp.:
9.05% Sr. Unsec. Nts., 11/15/11 6 5,459,000 6,318,793
9.75% Sr. Nts., 11/15/31 6 600,000 783,750
- --------------------------------------------------------------------------------
CellNet Data Systems, Inc., Sr. Unsec.
Disc. Nts., 10/1/07 1,2,3 9,220,000 --
- --------------------------------------------------------------------------------
Centennial Cellular Operating Co.
LLC/Centennial Communications Corp.,
10.125% Sr. Nts., 6/15/13 7,350,000 8,342,250
- --------------------------------------------------------------------------------
Dobson Cellular Systems, Inc., 8.375% Sr.
Sec. Nts., 11/1/11 4 1,660,000 1,751,300
- --------------------------------------------------------------------------------
Dobson Communications Corp., 8.875% Sr.
Nts., 10/1/13 3,671,000 3,377,320
- --------------------------------------------------------------------------------
IWO Escrow Co., 6.891% Sr. Sec. Nts.,
1/15/12 4,6 570,000 568,575
- --------------------------------------------------------------------------------
Nextel Communications, Inc., 7.375% Sr.
Nts., 8/1/15 11,460,000 12,434,100
- --------------------------------------------------------------------------------
Nextel Partners, Inc., 8.125% Sr. Nts.,
7/1/11 3,300,000 3,597,000
36 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES Continued
Rogers Wireless, Inc.:
6.375% Sec. Nts., 3/1/14 $ 2,100,000 $ 2,147,250
7.50% Sec. Nts., 3/15/15 2,700,000 2,949,750
8% Sr. Sub. Nts., 12/15/12 1,400,000 1,515,500
- --------------------------------------------------------------------------------
Rural Cellular Corp.:
8.25% Sr. Sec. Nts., 3/15/12 2,100,000 2,205,000
9.625% Sr. Sub. Nts., Series B, 5/15/08 1,150,000 1,115,500
9.75% Sr. Sub. Nts., 1/15/10 2,747,000 2,568,445
9.875% Sr. Nts., 2/1/10 2,200,000 2,282,500
- --------------------------------------------------------------------------------
SBA Communications Corp., 8.50% Sr. Unsec.
Nts., Cl. A, 12/1/12 4,350,000 4,708,875
- --------------------------------------------------------------------------------
SBA Telecommunications, Inc./SBA
Communications Corp., 0%/9.75% Sr. Disc.
Nts., 12/15/11 5 6,234,000 5,766,450
- --------------------------------------------------------------------------------
Triton PCS, Inc., 8.50% Sr. Unsec. Nts.,
6/1/13 4,400,000 4,081,000
- --------------------------------------------------------------------------------
UbiquiTel Operating Co., 9.875% Sr. Nts.,
3/1/11 4,200,000 4,630,500
- --------------------------------------------------------------------------------
US Unwired, Inc., 10% Sr. Sec. Nts., 6/15/12 1,625,000 1,815,938
- --------------------------------------------------------------------------------
Western Wireless Corp., 9.25% Sr. Unsec.
Nts., 7/15/13 1,599,000 1,828,856
----------------
92,546,799
- --------------------------------------------------------------------------------
UTILITIES--6.6%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--4.9%
AES Corp. (The):
8.375% Sr. Unsec. Unsub. Nts.,3/1/11 1 [GBP] 2,500,000 4,524,036
8.75% Sr. Sec. Nts., 5/15/13 4 2,700,000 3,030,750
- --------------------------------------------------------------------------------
Allegheny Energy, Inc., 7.75% Nts., 8/1/05 1,350,000 1,354,725
- --------------------------------------------------------------------------------
Caithness Coso Funding Corp., 9.05% Sr. Sec.
Nts., Series B, 12/15/09 686,761 739,985
- --------------------------------------------------------------------------------
Calpine Corp.:
7.625% Sr. Nts., 4/15/06 974,000 917,995
8.891% Sr. Sec. Nts., 7/15/07 4,6 5,786,925 4,976,756
- --------------------------------------------------------------------------------
CenterPoint Energy, Inc., 7.25% Sr. Nts.,
Series B, 9/1/10 1,200,000 1,332,875
- --------------------------------------------------------------------------------
CMS Energy Corp.:
7.50% Sr. Nts., 1/15/09 1,147,000 1,212,953
7.75% Sr. Nts., 8/1/10 1,400,000 1,512,000
9.875% Sr. Unsec. Nts., 10/15/07 4,000,000 4,380,000
- --------------------------------------------------------------------------------
FPL Energy National Wind Power:
5.608% Nts., 3/10/24 4 1,190,000 1,217,795
6.125% Nts., 3/25/19 4 760,000 739,278
- --------------------------------------------------------------------------------
Midwest Generation LLC, 8.75% Sr. Sec.
Nts., 5/1/34 9,400,000 10,575,000
- --------------------------------------------------------------------------------
Mirant Americas Generation LLC, 8.30% Sr.
Unsec. Nts., 5/1/11 2,3 1,300,000 1,498,250
- --------------------------------------------------------------------------------
MSW Energy Holdings II LLC/MSW Energy Finance
Co. II, Inc., 7.375% Sr. Sec. Nts., Series B,
9/1/10 3,350,000 3,450,500
- --------------------------------------------------------------------------------
MSW Energy Holdings LLC/MSW Energy Finance
Co., Inc., 8.50% Sr. Sec. Nts., 9/1/10 1,300,000 1,381,250
- --------------------------------------------------------------------------------
NRG Energy, Inc., 8% Sr. Sec. Nts.,
12/15/13 4 5,044,000 5,346,640
37 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES Continued
Reliant Resources, Inc.:
9.25% Sr. Sec. Nts., 7/15/10 $ 4,997,000 $ 5,471,715
9.50% Sr. Sec. Nts., 7/15/13 5,950,000 6,634,250
- --------------------------------------------------------------------------------
Teco Energy, Inc., 7.20% Unsec. Unsub. Nts.,
5/1/11 2,550,000 2,779,500
- --------------------------------------------------------------------------------
Texas Genco LLC, 6.875% Sr. Nts., 12/15/14 4 5,350,000 5,657,625
- --------------------------------------------------------------------------------
TXU Corp., 5.55% Nts., 11/15/14 4 5,325,000 5,191,108
----------------
73,924,986
- --------------------------------------------------------------------------------
GAS UTILITIES--0.0%
SEMCO Energy, Inc., 7.125% Sr. Nts., 5/15/08 1,100,000 1,125,394
- --------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER--1.6%
AES Red Oak LLC, 8.54% Sr. Sec. Bonds, Series
A, 11/30/19 1 3,271,438 3,664,010
- --------------------------------------------------------------------------------
Calpine Canada Energy Finance ULC, 8.50% Sr.
Unsec. Nts., 5/1/08 6,300,000 4,567,500
- --------------------------------------------------------------------------------
Consumers Energy Co., 6.375% Sr. Sec. Nts.,
2/1/08 800,000 839,090
- --------------------------------------------------------------------------------
Dynegy Holdings, Inc.:
6.875% Sr. Unsec. Unsub. Nts., 4/1/11 2,886,000 2,864,355
8.75% Sr. Nts., 2/15/12 1,159,000 1,269,105
10.125% Sr. Sec. Nts., 7/15/13 4 6,200,000 7,037,000
- --------------------------------------------------------------------------------
Mirant Mid-Atlantic LLC, 8.625% Sec.
Pass-Through Certificates,
Series A, 6/30/12 2,601,488 2,707,173
- --------------------------------------------------------------------------------
NorthWestern Corp., 5.875% Sr. Sec. Nts.,
11/1/14 4 1,000,000 1,030,000
----------------
23,978,233
- --------------------------------------------------------------------------------
WATER UTILITIES--0.1%
National Waterworks, Inc., 10.50% Sr. Unsec.
Sub. Nts., Series B, 12/1/12 1,400,000 1,582,000
----------------
Total Corporate Bonds and Notes
(Cost $1,313,710,300) 1,331,065,621
SHARES
- --------------------------------------------------------------------------------
PREFERRED STOCKS--1.5%
- --------------------------------------------------------------------------------
AmeriKing, Inc., 13% Cum. Sr. Exchangeable,
Non-Vtg. 1,3 110,146 --
- --------------------------------------------------------------------------------
Doane Pet Care Co., 14.25% Jr. Sub. Exchange
Debs., Non-Vtg. 1,3 140,000 11,235,000
- --------------------------------------------------------------------------------
Dobson Communications Corp., 6% Cv., Series
F (converts into Dobson Communications Corp.,
Cl. A common stock), Non-Vtg. 4 2,800 351,400
- --------------------------------------------------------------------------------
e.spire Communications, Inc., 12.75% Jr.
Redeemable, Non-Vtg. 1,3 3,738 374
- --------------------------------------------------------------------------------
Eagle-Picher Holdings, Inc., 11.75% Cum.
Exchangeable, Series B, Non-Vtg. 1,3 28,000 35,000
- --------------------------------------------------------------------------------
ICG Holdings, Inc., 14.25% Exchangeable,
Non-Vtg. 1,3 1 --
- --------------------------------------------------------------------------------
McLeodUSA, Inc., 2.50% Cv., Series A 3 6,516 1,564
- --------------------------------------------------------------------------------
Pacific & Atlantic Holdings, Inc., 7.50%
Cum. Cv., Series A 1,7 134,549 259,370
- --------------------------------------------------------------------------------
Paxson Communications Corp., 14.25%
Cum. Jr. Exchangeable, Non-Vtg. 1,7 884 5,704,010
- --------------------------------------------------------------------------------
PTV, Inc., 10% Cum., Series A, Non-Vtg. 192 384
- --------------------------------------------------------------------------------
Rural Cellular Corp., 11.375% Cum., Series
B, Non-Vtg. 1,3 1,487 1,371,758
38 | OPPENHEIMER HIGH YIELD FUND
VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
PREFERRED STOCKS Continued
- --------------------------------------------------------------------------------
Sovereign Real Estate Investment Trust,
12% Non-Cum., Series A 1 26,250 $ 3,812,813
----------------
Total Preferred Stocks (Cost $24,667,972) 22,771,673
- --------------------------------------------------------------------------------
COMMON STOCKS--0.8%
- --------------------------------------------------------------------------------
Broadwing Corp. 10,551 48,746
- --------------------------------------------------------------------------------
Cebridge Connections Holding LLC 1,3 6,613 --
- --------------------------------------------------------------------------------
Citigroup, Inc. 2,479 114,604
- --------------------------------------------------------------------------------
Covad Communications Group, Inc. 3 132,227 185,118
- --------------------------------------------------------------------------------
Dobson Communications Corp., Cl. A 3 157,019 668,901
- --------------------------------------------------------------------------------
Equinix, Inc. 3 177 7,671
- --------------------------------------------------------------------------------
Globix Corp. 3 80,275 198,279
- --------------------------------------------------------------------------------
Horizon Natural Resources Co. 1,3 93,333 --
- --------------------------------------------------------------------------------
Huntsman Corp. 3 54,796 1,055,179
- --------------------------------------------------------------------------------
ICO Global Communication Holdings Ltd. 3 168,429 707,402
- --------------------------------------------------------------------------------
iPCS, Inc. 3 38,470 1,250,275
- --------------------------------------------------------------------------------
Leap Wireless International, Inc. 3 17,168 476,412
- --------------------------------------------------------------------------------
Liberty Global, Inc., Series A 3 30,141 1,406,680
- --------------------------------------------------------------------------------
Magellan Health Services, Inc. 3 72,415 2,556,974
- --------------------------------------------------------------------------------
Manitowoc Co., Inc. (The) 3,772 154,727
- --------------------------------------------------------------------------------
MCI, Inc. 24,441 628,378
- --------------------------------------------------------------------------------
Orbital Sciences Corp. 3 14,063 139,224
- --------------------------------------------------------------------------------
Pioneer Cos., Inc. 3 28,991 637,512
- --------------------------------------------------------------------------------
Polymer Group, Inc., Cl. A 3 8,124 205,131
- --------------------------------------------------------------------------------
Prandium, Inc. 1,3,9 459,132 2,755
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. 1,3 3,987 147,519
- --------------------------------------------------------------------------------
TVMAX Holdings, Inc. 1,3 30,000 165,000
- --------------------------------------------------------------------------------
Viatel Holding (Bermuda) Ltd. 1,3 13,172 3,754
- --------------------------------------------------------------------------------
Western Forest Products, Inc. 3 467,777 1,574,910
- --------------------------------------------------------------------------------
WRC Media Corp. 1,3 9,471 189
- --------------------------------------------------------------------------------
XO Communications, Inc. 3 16,729
44,499
----------------
Total Common Stocks (Cost $27,603,870) 12,379,839
UNITS
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.1%
- --------------------------------------------------------------------------------
American Tower Corp. Wts., Exp. 8/1/08 3,4 4,300 1,274,350
- --------------------------------------------------------------------------------
COLO.com, Inc. Wts., Exp. 3/15/10 1,3 2,000 --
- --------------------------------------------------------------------------------
Concentric Network Corp. Wts., Exp.
12/15/07 1,3 3,330 --
- --------------------------------------------------------------------------------
DeCrane Aircraft Holdings, Inc. Wts.,
Exp. 9/30/08 1,3 4,000 --
- --------------------------------------------------------------------------------
Diva Systems Corp. Wts., Exp. 3/1/08 1,3 7,500 --
39 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
VALUE
UNITS SEE NOTE 1
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATE Continued
- --------------------------------------------------------------------------------
e.spire Communications, Inc. Wts., Exp.
11/1/05 1,3 2,575 $ 26
- --------------------------------------------------------------------------------
HF Holdings, Inc. Wts., Exp. 9/27/09 1,3 1,445 14
- --------------------------------------------------------------------------------
ICG Communications, Inc. Wts., Exp.
9/15/05 1,3 50,820 --
- --------------------------------------------------------------------------------
ICO Global Communication Holdings Ltd. Wts.:
Exp. 5/16/06 1,3 42,243 1,690
Exp. 5/16/06 1,3 63 --
- --------------------------------------------------------------------------------
Insilco Corp. Wts., Exp. 8/15/07 3,4 7,055 --
- --------------------------------------------------------------------------------
iPCS, Inc. Wts., Exp. 6/15/10 1,3 3,750 --
- --------------------------------------------------------------------------------
Long Distance International, Inc. Wts.,
Exp. 4/13/08 3,4 2,800 --
- --------------------------------------------------------------------------------
Loral Space & Communications Ltd. Wts.,
Exp. 1/15/07 1,3 3,910 --
- --------------------------------------------------------------------------------
McLeodUSA, Inc. Wts., Exp. 4/16/07 3 14,440 72
- --------------------------------------------------------------------------------
Ntelos, Inc. Wts., Exp. 8/15/10 1,3 5,000 --
- --------------------------------------------------------------------------------
Orion Network Systems, Inc. Rts., Exp.
7/8/05 3 916 --
- --------------------------------------------------------------------------------
Pathmark Stores, Inc. Wts., Exp. 9/19/10 3 100,000 37,000
- --------------------------------------------------------------------------------
Sterling Chemicals, Inc. Wts., Exp.
12/19/08 1,3 6,474 13,595
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. A Wts.,
Exp. 1/16/10 3 33,465 11,713
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. B Wts.,
Exp. 1/16/10 3 25,098 6,525
- --------------------------------------------------------------------------------
XO Communications, Inc., Cl. C Wts.,
Exp. 1/16/10 3 25,098 5,250
- --------------------------------------------------------------------------------
Ziff Davis Holdings, Inc. Wts.,
Exp. 8/12/12 1,3 30,800 3,080
----------------
Total Rights, Warrants and Certificates
(Cost $521,029) 1,353,315
PRINCIPAL
AMOUNT
- --------------------------------------------------------------------------------
STRUCTURED NOTES--1.2%
- --------------------------------------------------------------------------------
Dow Jones CDX High Yield Index Pass-Through
Certificates:
Series 3-4, 10.50%, 12/29/09 4,10 $ 4,000,000 3,935,000
Series 4-T1, 8.25%, 6/29/10 4,10 11,880,000 11,939,400
- --------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc., High Yield
Targeted Return Index
Securities, Series 2004-1, 8.218%, 8/1/15 1,10 2,568,185 2,761,236
----------------
Total Structured Notes (Cost $18,658,767) 18,635,636
- --------------------------------------------------------------------------------
MONEY MARKET DEPOSIT--0.1%
- --------------------------------------------------------------------------------
JPMorgan Chase, Nassau Branch, 2.716%,
7/1/05 (Cost $1,896,542) 1,896,542 1,896,542
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--6.9%
- --------------------------------------------------------------------------------
Undivided interest of 0.62% in joint
repurchase agreement (Principal Amount/Value
$193,040,000, with a maturity value of
$193,055,711) with DB Alex Brown LLC, 2.93%,
dated 6/30/05, to be repurchased at
$1,200,098 on 7/1/05, collateralized by U.S.
Treasury Bonds, 8.125%--9%, 11/15/18--8/15/21
with a value of $196,993,905 1,200,000 1,200,000
40 | OPPENHEIMER HIGH YIELD FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS Continued
- --------------------------------------------------------------------------------
Undivided interest of 8.32% in joint
repurchase agreement (Principal Amount/Value
$1,234,399,000, with a maturity value of
$1,234,508,724) with UBS Warburg LLC, 3.20%,
dated 6/30/05, to be repurchased at
$102,698,128 on 7/1/05, collateralized by
Federal Home Loan Mortgage Corp., 5.50%,
2/1/35, with a value of $1,260,871,334 $ 102,689,000 $ 102,689,000
----------------
Total Joint Repurchase Agreements
(Cost $103,889,000) 103,889,000
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST
$1,503,480,421) 99.1% 1,501,681,626
- --------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 0.9 13,915,692
--------------------------------
NET ASSETS 100.0% $ 1,515,597,318
================================
FOOTNOTES TO STATEMENT OF INVESTMENTS
Principal amount is reported in U.S. Dollars, except for those denoted in the
following currencies:
EUR Euro
GBP British Pound Sterling
1. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of June 30, 2005 was $67,219,335, which represents
4.44% of the Fund's net assets, of which $2,755 is considered
restricted. See Note 6 of Notes to Financial Statements.
2. Issue is in default. See Note 1 of Notes to Financial Statements.
3. Non-income producing security.
4. 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 $205,337,225 or 13.55% of the Fund's net
assets as of June 30, 2005.
5. Denotes a step bond: a zero coupon bond that converts to a fixed or variable
interest rate at a designated future date.
6. Represents the current interest rate for a variable or increasing rate
security.
7. Interest or dividend is paid-in-kind.
8. Zero coupon bond reflects effective yield on the date of purchase.
9. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended June 30, 2005. The
aggregate fair value of securities of affiliated companies held by the Fund as
of June 30, 2005 amounts to $2,755. Transactions during the period in which the
issuer was an affiliate are as follows:
SHARES GROSS GROSS SHARES VALUE DIVIDEND
JUNE 30, 2004 ADDITIONS REDUCTIONS JUNE 30, 2005 SEE NOTE 1 INCOME
- -----------------------------------------------------------------------------------------------
Prandium, Inc. 459,132 -- -- 459,132 $ 2,755 $ --
10. Interest rate represents a weighted average rate comprised of the interest
rates of the underlying securities.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
41 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF ASSETS AND LIABILITIES June 30, 2005
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investments, at value--see accompanying statement of
investments:
Unaffiliated companies (cost $1,498,080,421) $ 1,501,678,871
Affiliated companies (cost $5,400,000) 2,755
----------------
1,501,681,626
- --------------------------------------------------------------------------------
Cash 484,600
- --------------------------------------------------------------------------------
Receivables and other assets:
Interest and dividends 27,439,759
Investments sold 6,071,628
Shares of beneficial interest sold 1,055,361
Other 35,301
----------------
Total assets 1,536,768,275
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 14,310,739
Dividends 2,830,371
Shares of beneficial interest redeemed 2,683,979
Distribution and service plan fees 873,414
Transfer and shareholder servicing agent fees 214,692
Shareholder communications 154,057
Trustees' compensation 38,052
Other 65,653
----------------
Total liabilities 21,170,957
- --------------------------------------------------------------------------------
NET ASSETS $ 1,515,597,318
================
- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- --------------------------------------------------------------------------------
Par value of shares of beneficial interest $ 160,739
- --------------------------------------------------------------------------------
Additional paid-in capital 2,130,818,362
- --------------------------------------------------------------------------------
Accumulated net investment loss (4,807,789)
- --------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign
currency transactions (608,766,511)
- --------------------------------------------------------------------------------
Net unrealized depreciation on investments and translation
of assets and liabilities denominated in foreign currencies (1,807,483)
----------------
NET ASSETS $ 1,515,597,318
================
42 | OPPENHEIMER HIGH YIELD FUND
- ------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$1,092,260,509 and 115,511,898 shares of beneficial interest outstanding) $9.46
Maximum offering price per share (net asset value plus sales charge of 4.75%
of offering price) $9.93
- ------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$232,046,273 and 24,926,106 shares of beneficial interest outstanding) $9.31
- ------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$134,452,646 and 14,257,678 shares of beneficial interest outstanding) $9.43
- ------------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$15,973,328 and 1,685,975 shares of beneficial interest outstanding) $9.47
- ------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $40,864,562 and 4,357,176 shares of beneficial interest
outstanding) $9.38
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
43 | OPPENHEIMER HIGH YIELD FUND
STATEMENT OF OPERATIONS For the Year Ended June 30, 2005
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Interest $ 130,548,706
- --------------------------------------------------------------------------------
Dividends 359,539
----------------
Total investment income 130,908,245
- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees 9,926,511
- --------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 2,696,103
Class B 2,786,128
Class C 1,490,963
Class N 68,758
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 1,709,174
Class B 439,599
Class C 255,966
Class N 37,713
Class Y 234,660
- --------------------------------------------------------------------------------
Shareholder communications:
Class A 207,656
Class B 66,754
Class C 32,124
Class N 3,595
Class Y 85
- --------------------------------------------------------------------------------
Trustees' compensation 36,211
- --------------------------------------------------------------------------------
Custodian fees and expenses 31,809
- --------------------------------------------------------------------------------
Other 100,230
----------------
Total expenses 20,124,039
Less reduction to custodian expenses (25,516)
Less waivers and reimbursements of expenses (51,390)
----------------
Net expenses 20,047,133
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 110,861,112
44 | OPPENHEIMER HIGH YIELD FUND
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments $ (36,530,841)
Foreign currency transactions 1,038,946
Swap contracts (1,388,442)
----------------
Net realized loss (36,880,337)
- --------------------------------------------------------------------------------
Net change in unrealized depreciation on:
Investments 49,285,614
Translation of assets and liabilities denominated in foreign
currencies (761,748)
Swap contracts (2,572,348)
----------------
Net change in unrealized depreciation 45,951,518
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 119,932,293
================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
45 | OPPENHEIMER HIGH YIELD FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
YEAR ENDED JUNE 30, 2005 2004
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
OPERATIONS
- -----------------------------------------------------------------------------------------
Net investment income $ 110,861,112 $ 130,707,043
- -----------------------------------------------------------------------------------------
Net realized gain (loss) (36,880,337) 7,552,801
- -----------------------------------------------------------------------------------------
Net change in unrealized depreciation 45,951,518 32,370,748
----------------------------------
Net increase in net assets resulting from
operations 119,932,293 170,630,592
- -----------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- -----------------------------------------------------------------------------------------
Dividends from net investment income:
Class A (79,104,021) (86,840,525)
Class B (17,461,746) (23,983,742)
Class C (9,342,456) (11,359,611)
Class N (915,301) (757,025)
Class Y (3,700,700) (4,327,419)
- -----------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- -----------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
beneficial interest transactions:
Class A 12,882,345 (106,090,589)
Class B (73,579,012) (78,231,133)
Class C (15,884,269) (14,771,121)
Class N 7,103,476 565,563
Class Y (16,599,862) 1,289,210
- -----------------------------------------------------------------------------------------
NET ASSETS
- -----------------------------------------------------------------------------------------
Total decrease (76,669,253) (153,875,800)
- -----------------------------------------------------------------------------------------
Beginning of period 1,592,266,571 1,746,142,371
----------------------------------
End of period (including accumulated net
investment loss of $4,807,789 and $2,518,220,
respectively) $ 1,515,597,318 $ 1,592,266,571
==================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
46 | OPPENHEIMER HIGH YIELD FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
CLASS A YEAR ENDED JUNE 30, 2005 2004 2003 2002 2001
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.41 $ 9.15 $ 8.62 $ 10.20 $ 11.89
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .67 1 .73 .84 .92 1.18
Net realized and unrealized gain (loss) .05 .24 .47 (1.44) (1.59)
--------------------------------------------------------------------------------
Total from investment operations .72 .97 1.31 (.52) (.41)
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.67) (.71) (.69) (1.01) (1.28)
Tax return of capital distribution -- -- (.09) (.05) --
--------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.67) (.71) (.78) (1.06) (1.28)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.46 $ 9.41 $ 9.15 $ 8.62 $ 10.20
================================================================================
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 7.85% 10.90% 16.38% (5.47)% (3.69)%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 1,092,260 $ 1,073,708 $ 1,150,055 $ 858,834 $ 962,017
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 1,125,060 $ 1,146,751 $ 934,227 $ 948,097 $ 1,038,442
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 7.05% 7.80% 9.54% 9.68% 10.66%
Total expenses 1.03% 4,5 1.03% 4,5 1.07% 4 1.10% 4 1.00% 4
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 52% 55% 68% 47% 33%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. 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. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods less than one year.
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.
47 | OPPENHEIMER HIGH YIELD FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
CLASS B YEAR ENDED JUNE 30, 2005 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.26 $ 9.03 $ 8.51 $ 10.09 $ 11.77
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .59 1 .63 .74 .84 1.10
Net realized and unrealized gain (loss) .05 .24 .49 (1.43) (1.58)
----------------------------------------------------------------------------------
Total from investment operations .64 .87 1.23 (.59) (.48)
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.59) (.64) (.62) (.94) (1.20)
Tax return of capital distribution -- -- (.09) (.05) --
----------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.59) (.64) (.71) (.99) (1.20)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.31 $ 9.26 $ 9.03 $ 8.51 $ 10.09
==================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 7.05% 9.86% 15.60% (6.23)% (4.37)%
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 232,046 $ 303,184 $ 372,947 $ 338,654 $ 386,309
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 279,146 $ 347,319 $ 321,200 $ 366,869 $ 414,648
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 6.27% 7.03% 8.81% 8.93% 9.91%
Total expenses 1.80% 4,5 1.80% 4,5 1.84% 4 1.86% 4 1.76% 4
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 52% 55% 68% 47% 33%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. 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. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods less than one year.
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.
48 | OPPENHEIMER HIGH YIELD FUND
CLASS C YEAR ENDED JUNE 30, 2005 2004 2003 2002 2001
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.38 $ 9.13 $ 8.60 $ 10.18 $ 11.87
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .60 1 .66 .78 .86 1.11
Net realized and unrealized gain (loss) .05 .23 .46 (1.45) (1.60)
--------------------------------------------------------------------------------
Total from investment operations .65 .89 1.24 (.59) (.49)
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.60) (.64) (.62) (.94) (1.20)
Tax return of capital distribution -- -- (.09) (.05) --
--------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.60) (.64) (.71) (.99) (1.20)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.43 $ 9.38 $ 9.13 $ 8.60 $ 10.18
================================================================================
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 7.02% 9.96% 15.55% (6.08)% (4.43)%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 134,453 $ 149,505 $ 160,713 $ 106,884 $ 90,603
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 149,487 $ 166,367 $ 120,997 $ 104,882 $ 83,776
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 6.27% 7.03% 8.78% 8.75% 9.90%
Total expenses 1.81% 4,5 1.79% 4,5 1.83% 4 1.86% 4 1.76% 4
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 52% 55% 68% 47% 33%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. 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. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods less than one year.
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.
49 | OPPENHEIMER HIGH YIELD FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
CLASS N YEAR ENDED JUNE 30, 2005 2004 2003 2002 2001 1
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.43 $ 9.17 $ 8.63 $ 10.20 $ 11.33
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .64 2 .70 .80 .96 .41
Net realized and unrealized gain (loss) .04 .24 .49 (1.48) (1.13)
--------------------------------------------------------------------------------
Total from investment operations .68 .94 1.29 (.52) (.72)
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.64) (.68) (.66) (1.00) (.41)
Tax return of capital distribution -- -- (.09) (.05) --
--------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.64) (.68) (.75) (1.05) (.41)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.47 $ 9.43 $ 9.17 $ 8.63 $ 10.20
================================================================================
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 7.32% 10.47% 16.08% (5.53)% (6.43)%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 15,973 $ 8,894 $ 8,324 $ 2,396 $ 146
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 13,788 $ 10,501 $ 4,827 $ 799 $ 46
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 6.66% 7.41% 9.14% 8.41% 11.47%
Total expenses 1.42% 5,6 1.38% 5,6 1.41% 5 1.35% 5 1.04% 5
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 52% 55% 68% 47% 33%
1. For the period from March 1, 2001 (inception of offering) to June 30, 2001.
2. Per share amounts calculated based on the average shares outstanding during
the period.
3. 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. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods less than one year.
Returns do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Voluntary waiver of transfer agent fees less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
50 | OPPENHEIMER HIGH YIELD FUND
CLASS Y YEAR ENDED JUNE 30, 2005 2004 2003 2002 2001
- ----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.33 $ 9.09 $ 8.56 $ 10.14 $ 11.82
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .67 1 .73 .86 .90 1.20
Net realized and unrealized gain (loss) .05 .23 .45 (1.41) (1.59)
--------------------------------------------------------------------------------
Total from investment operations .72 .96 1.31 (.51) (.39)
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.67) (.72) (.69) (1.02) (1.29)
Tax return of capital distribution -- -- (.09) (.05) --
--------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.67) (.72) (.78) (1.07) (1.29)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.38 $ 9.33 $ 9.09 $ 8.56 $ 10.14
================================================================================
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 7.92% 10.80% 16.51% (5.37)% (3.57)%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 40,865 $ 56,976 $ 54,102 $ 38,500 $ 60,244
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 52,400 $ 56,276 $ 43,178 $ 44,583 $ 56,669
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 7.08% 7.85% 9.63% 9.88% 10.72%
Total expenses 1.07% 1.14% 1.34% 1.01% 0.94%
Expenses after payments and waivers and
reduction to custodian expenses 0.97% 0.98% 0.98% 0.98% N/A 4
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 52% 55% 68% 47% 33%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. 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. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods less than one year.
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%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
51 | OPPENHEIMER HIGH YIELD FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer High Yield Fund (the Fund) is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
The Fund's primary investment objective is to seek a high level of current
income by investing in a diversified portfolio of high-yield, lower-rated
fixed-income securities the Fund's investment Manager, OppenheimerFunds, Inc.
(the Manager), believes do not involve undue risk. The Fund's secondary
objective is to seek capital growth when consistent with its primary objective.
The Fund offers Class A, Class B, Class C, Class N and Class Y shares.
Class A shares are sold at their offering price, which is normally net asset
value plus a front-end sales charge. Class B, Class C and Class N shares are
sold without a front-end sales charge but may be subject to a contingent
deferred sales charge (CDSC). Class N shares are sold only through retirement
plans. Retirement plans that offer Class N shares may impose charges on those
accounts. Class Y shares are sold to certain institutional investors without
either a front-end sales charge or a CDSC, however, the institutional investor
may impose charges on those accounts. All classes of shares have identical
rights and voting privileges with respect to the Fund in general and exclusive
voting rights on matters that affect that class alone. Earnings, net assets and
net asset value per share may differ due to each class having its own expenses,
such as transfer and shareholder servicing agent fees and shareholder
communications, directly attributable to that class. Class A, B, C and N have
separate distribution and/or service plans. No such plan has been adopted for
Class Y shares. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The Fund assesses a 2% fee on the proceeds of
fund shares that are redeemed (either by selling or exchanging to another
Oppenheimer fund) within 30 days of their purchase. The fee, which is retained
by the Fund, is accounted for as an addition to paid-in capital.
The following is a summary of significant accounting policies consistently
followed by the Fund.
- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. 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.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of sixty days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Futures contracts traded on a
commodities or futures exchange will be valued at the final settlement price or
official closing price on
52 | OPPENHEIMER HIGH YIELD FUND
the principal exchange as reported by such principal exchange at its trading
session ending at, or most recently prior to, the time when the Fund's assets
are valued. Securities may be valued primarily using dealer-supplied valuations
or a portfolio pricing service authorized by the Board of Trustees. Securities
(including restricted securities) for which market quotations are not readily
available are valued at their fair value. Foreign and domestic securities whose
values have been materially affected by what the Manager identifies as a
significant event occurring before the Fund's assets are valued but after the
close of their respective exchanges will be fair valued. 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 structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying Statement of Operations. The Fund records a realized gain or loss
when a structured note is sold or matures. As of June 30, 2005, the market value
of these securities comprised 1.2% of the Fund's net assets and resulted in
unrealized cumulative losses of $23,131.
- --------------------------------------------------------------------------------
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, 2005, securities with an aggregate
market value of $25,714,639, representing 1.70% of the Fund's net assets, were
in default.
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. The values of securities denominated in foreign currencies and
amounts related to the purchase and sale of foreign securities and foreign
investment income are translated into U.S. dollars as of the close of The New
York Stock Exchange (the Exchange), normally 4:00 P.M. Eastern time, on each day
the Exchange is open for business. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.
Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the
53 | OPPENHEIMER HIGH YIELD FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
amounts actually received or paid. Net unrealized foreign exchange gains and
losses arise from changes in the values of assets and liabilities, including
investments in securities at fiscal period end, resulting from changes in
exchange rates.
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. 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, therefore, no federal income or excise tax provision is
required.
The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.
NET UNREALIZED
DEPRECIATION
BASED ON COST OF
SECURITIES AND
UNDISTRIBUTED UNDISTRIBUTED ACCUMULATED OTHER INVESTMENTS
NET INVESTMENT LONG-TERM LOSS FOR FEDERAL INCOME
INCOME GAIN CARRYFORWARD 1,2,3,4,5 TAX PURPOSES
--------------------------------------------------------------------------
$623,387 $-- $603,646,103 $7,454,730
1. As of June 30, 2005, the Fund had $603,106,885 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of June 30, 2005, details
of the capital loss carryforwards were as follows:
54 | OPPENHEIMER HIGH YIELD FUND
EXPIRING
-------------------
2007 $ 30,649,297
2008 35,734,504
2009 57,513,604
2010 101,344,550
2011 284,056,063
2012 55,694,998
2013 38,113,869
------------
Total $603,106,885
============
2. As of June 30, 2005, the Fund had $431,684 of post-October losses available
to offset future realized capital gains, if any. Such losses, if unutilized,
will expire in 2014.
3. The Fund had $107,534 of post-October foreign currency losses which were
deferred.
4. During the fiscal year ended June 30, 2005, the Fund did not utilize any
capital loss carryforward.
5. During the fiscal year ended June 30, 2004, the Fund did not utilize any
capital loss carryforward.
Net investment income (loss) and net realized gain (loss) may differ for
financial statement and 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 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. Accordingly, the
following amounts have been reclassified for June 30, 2005. Net assets of the
Fund were unaffected by the reclassifications.
REDUCTION TO
INCREASE TO ACCUMULATED NET
ACCUMULATED NET REALIZED LOSS
INVESTMENT LOSS ON INVESTMENTS
---------------------------------
$2,626,457 $2,626,457
The tax character of distributions paid during the years ended June 30, 2005 and
June 30, 2004 was as follows:
YEAR ENDED YEAR ENDED
JUNE 30, 2005 JUNE 30, 2004
---------------------------------------------------------
Distributions paid from:
Ordinary income $110,524,224 $ 127,268,322
The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of June 30, 2005 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.
Federal tax cost of securities $ 1,509,127,669
================
Gross unrealized appreciation $ 81,390,589
Gross unrealized depreciation (88,845,319)
----------------
Net unrealized depreciation $ (7,454,730)
================
55 | OPPENHEIMER HIGH YIELD FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.
- --------------------------------------------------------------------------------
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 U.S. generally
accepted accounting principles 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
56 | OPPENHEIMER HIGH YIELD FUND
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:
YEAR ENDED JUNE 30, 2005 YEAR ENDED JUNE 30, 2004
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------
CLASS A
Sold 38,389,735 $ 366,629,436 65,440,622 $ 609,447,561
Dividends and/or
distributions reinvested 5,558,232 53,115,827 6,284,592 59,173,057
Redeemed (42,566,938) (406,862,918) 1 (83,219,779) (774,711,207)
------------------------------------------------------------
Net increase (decrease) 1,381,029 $ 12,882,345 (11,494,565) $(106,090,589)
============================================================
- ---------------------------------------------------------------------------------------
CLASS B
Sold 5,983,222 $ 56,234,386 10,475,101 $ 96,503,159
Dividends and/or
distributions reinvested 1,018,189 9,579,810 1,439,766 13,343,552
Redeemed (14,803,057) (139,393,208) 1 (20,508,450) (188,077,844)
------------------------------------------------------------
Net decrease (7,801,646) $ (73,579,012) (8,593,583) $ (78,231,133)
============================================================
- ---------------------------------------------------------------------------------------
CLASS C
Sold 4,405,322 $ 42,084,078 8,189,437 $ 76,360,660
Dividends and/or
distributions reinvested 673,504 6,418,231 805,948 7,573,293
Redeemed (6,754,941) (64,386,578) 1 (10,659,737) (98,705,074)
------------------------------------------------------------
Net decrease (1,676,115) $ (15,884,269) (1,664,352) $ (14,771,121)
============================================================
- ---------------------------------------------------------------------------------------
CLASS N
Sold 1,306,473 $ 12,488,035 1,242,698 $ 11,666,882
Dividends and/or
distributions reinvested 86,918 832,537 73,083 691,810
Redeemed (650,988) (6,217,096) 1 (1,279,807) (11,793,129)
------------------------------------------------------------
Net increase 742,403 $ 7,103,476 35,974 $ 565,563
============================================================
- ---------------------------------------------------------------------------------------
CLASS Y
Sold 3,233,381 $ 30,626,176 3,378,069 $ 31,354,635
Dividends and/or
distributions reinvested 390,120 3,698,863 463,551 4,327,419
Redeemed (5,371,495) (50,924,901) 1 (3,690,109) (34,392,844)
------------------------------------------------------------
Net increase (decrease) (1,747,994) $ (16,599,862) 151,511 $ 1,289,210
============================================================
1. Net of redemption fees of $28,208, $6,999, $3,748, $346 and $1,314 for Class
A, Class B, Class C, Class N and Class Y, respectively.
57 | OPPENHEIMER HIGH YIELD FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended June 30, 2005, were $755,534,209
and $830,601,884, respectively.
- --------------------------------------------------------------------------------
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 Fund 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% of the next $200 million and 0.50% of average annual
net assets over $1 billion.
- --------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.
- --------------------------------------------------------------------------------
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 per account fee. For the year ended June 30, 2005, the Fund paid
$2,631,155 to OFS for services to the Fund.
Additionally, Class Y shares are subject to minimum fees of $10,000 per
annum for assets of $10 million or more. The Class Y shares are subject to the
minimum fees in the event that the per account fee does not equal or exceed the
applicable minimum fees. OFS may voluntarily waive the minimum fees.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN (12b-1) FEES. Under its General Distributor's
Agreement with the Fund, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the Fund's principal underwriter in the continuous public offering of
the Fund's classes of shares.
- --------------------------------------------------------------------------------
SERVICE PLAN FOR CLASS A SHARES. The Fund has adopted a Service Plan for Class A
shares. It reimburses the Distributor for a portion of its costs incurred for
services provided to accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate of up to 0.25% of the average annual net assets of
Class A shares of the Fund. The Distributor currently uses all of those fees to
pay dealers, brokers, banks and other financial institutions quarterly for
providing personal services and maintenance of accounts of their customers that
hold Class A shares. Any unreimbursed expenses the Distributor incurs with
respect to Class A shares in any fiscal year cannot be recovered in subsequent
years. Fees incurred by the Fund under the Plan are detailed in the Statement of
Operations.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLANS FOR CLASS B, CLASS C AND CLASS N SHARES. The Fund
has adopted Distribution and Service Plans for Class B, Class C and Class N
shares to compensate the Distributor for its services in connection with the
distribution of those shares and servicing accounts. Under the plans, the Fund
pays the Distributor an annual asset-based sales charge of 0.75% per year on
Class B and Class C shares and 0.25% per year on Class N shares. The Distributor
also receives a service fee of 0.25% per year under
58 | OPPENHEIMER HIGH YIELD FUND
each plan. If either the Class B, Class C or Class N plan is terminated by the
Fund or by the shareholders of a class, the Board of Trustees and its
independent trustees must determine whether the Distributor shall be entitled to
payment from the Fund of all or a portion of the service fee and/or asset-based
sales charge in respect to shares sold prior to the effective date of such
termination. The Distributor's aggregate uncompensated expenses under the plan
at June 30, 2005 for Class B, Class C and Class N shares were $13,227,741,
$3,717,622 and $190,592, respectively. Fees incurred by the Fund under the plans
are detailed in the Statement of Operations.
- --------------------------------------------------------------------------------
SALES CHARGES. Front-end sales charges and contingent deferred sales charges
(CDSC) do not represent expenses of the Fund. They are deducted from the
proceeds of sales of Fund shares prior to investment or from redemption proceeds
prior to remittance, as applicable. The sales charges retained by the
Distributor from the sale of shares and the CDSC retained by the Distributor on
the redemption of shares is shown in the table below for the period indicated.
CLASS A CLASS B CLASS C CLASS N
CLASS A CONTINGENT CONTINGENT CONTINGENT CONTINGENT
FRONT-END DEFERRED DEFERRED DEFERRED DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES
RETAINED BY RETAINED BY RETAINED BY RETAINED BY RETAINED BY
YEAR ENDED DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR
- ---------------------------------------------------------------------------------------------
June 30, 2005 $ 478,278 $ 10,421 $ 741,637 $ 39,121 $ 4,826
- --------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS OF EXPENSES. OFS has voluntarily agreed to limit
transfer and shareholder servicing agent fees for all classes to 0.35% of
average annual net assets per class. During the year ended June 30, 2005, OFS
waived $11, $4, $1, $159 and $51,215 for Class A, Class B, Class C, Class N and
Class Y shares, respectively. This undertaking may be amended or withdrawn at
any time.
- --------------------------------------------------------------------------------
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
59 | OPPENHEIMER HIGH YIELD FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS Continued
gains or losses. Such realized gains and losses are reported with all other
foreign currency gains and losses in the Statement of Operations.
As of June 30, 2005, the Fund had no outstanding foreign currency
contracts.
- --------------------------------------------------------------------------------
6. ILLIQUID OR RESTRICTED SECURITIES
As of June 30, 2005, 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 will not invest more than 10% 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.
Securities that are illiquid or restricted are marked with the applicable
footnote on the Statement of Investments. Information concerning restricted
securities is as follows:
ACQUISITION VALUATION AS OF UNREALIZED
SECURITY DATES COST JUNE 30, 2005 DEPRECIATION
- --------------------------------------------------------------------------------
Prandium, Inc. 3/18/99-3/22/99 $ 5,400,000 $ 2,755 $ 5,397,245
- --------------------------------------------------------------------------------
7. LITIGATION
A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor, as well as 51 of the
Oppenheimer funds (as "Nominal Defendants") including the Fund, 30 present and
former Directors or Trustees and 8 present and former officers of the funds.
This complaint, initially filed in the U.S. District Court for the Southern
District of New York on January 10, 2005 and amended on March 4, 2005,
consolidates into a single action and amends six individual previously filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.
60 | OPPENHEIMER HIGH YIELD FUND
The defendants believe that the allegations contained in the Complaints
are without merit and that they have meritorious defenses against the claims
asserted. The defendants intend to defend these lawsuits vigorously and to
contest any claimed liability. The defendants believe that it is premature to
render any opinion as to the likelihood of an outcome unfavorable to them and
that no estimate can yet be made with any degree of certainty as to the amount
or range of any potential loss.
61 | OPPENHEIMER HIGH YIELD FUND
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER HIGH YIELD FUND:
We have audited the accompanying statement of assets and liabilities of
Oppenheimer High Yield Fund, including the statement of investments, as of June
30, 2005, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the period
then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
The Fund is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audit includes consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of June 30, 2005, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer High Yield Fund as of June 30, 2005, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the five
years in the period then ended, in conformity with accounting principles
generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
Denver, Colorado
August 15, 2005
62 | OPPENHEIMER HIGH YIELD FUND
FEDERAL INCOME TAX INFORMATION Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
In early 2006, if applicable, shareholders of record will receive information
regarding all dividends and distributions paid to them by the Fund during
calendar year 2005. Regulations of the U.S. Treasury Department require the Fund
to report this information to the Internal Revenue Service.
Dividends, if any, paid by the Fund during the fiscal year ended June 30,
2005 which are not designated as capital gain distributions should be multiplied
by 0.02% to arrive at the amount eligible for the corporate dividend-received
deduction.
A portion, if any, of the dividends paid by the Fund during the fiscal
year ended June 30, 2005 which are not designated as capital gain distributions
are eligible for lower individual income tax rates to the extent that the Fund
has received qualified dividend income as stipulated by recent tax legislation.
$24,726 of the Fund's fiscal year taxable income may be eligible for the lower
individual income tax rates. In early 2006, shareholders of record will receive
information regarding the percentage of distributions that are eligible for
lower individual income tax rates.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
63 | OPPENHEIMER HIGH YIELD FUND
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
1.800.525.7048, (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 is required to
file 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 Fund's voting record is
available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525.7048, and (ii) in Form N-PX filing on the SEC's website at
www.sec.gov.
The Fund files its complete schedule of portfolio holdings with the SEC
for the first quarter and the third quarter of each fiscal year on Form N-Q. The
Fund's Form N-Q filings are available on the SEC's website at
http://www.sec.gov. Those forms may be reviewed and copied at the SEC's Public
Reference Room in Washington D.C. Information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
64 | OPPENHEIMER HIGH YIELD FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Each year, the Board of Trustees (the "Board"), including a majority of the
independent Trustees, is required to determine whether to renew the Fund's
advisory agreement. The Investment Company Act of 1940, as amended, requires
that the Board request and evaluate, and that the Manager provide, such
information as may be reasonably necessary to evaluate the terms of the advisory
agreement. The Board employs an independent consultant to prepare a report that
provides information, including comparative information, that the Board requests
for this purpose. In addition, the Board receives information throughout the
year regarding Fund services, fees, expenses and performance.
NATURE AND EXTENT OF SERVICES. In considering the renewal of the Fund's
advisory agreement for the current year, the Board evaluated the nature and
extent of the services provided by the Manager and its affiliates. The Manager
provides the Fund with office space, facilities and equipment; administrative,
accounting, clerical, legal and compliance personnel; securities trading
services; oversight of third party service providers and the services of the
portfolio manager and the Manager's investment team, who provide research,
analysis and other advisory services in regard to the Fund's investments.
QUALITY OF SERVICES. The Board also considered the quality of the services
provided and the quality of the Manager's resources that are available to the
Fund. The Board noted that the Manager has had over forty years of experience as
an investment adviser and that its assets under management rank it among the top
mutual fund managers in the United States. The Board evaluated the Manager's
administrative, accounting, legal and compliance services and information the
Board received regarding the experience and professional qualifications of the
Manager's personnel and the size and functions of its staff. The Board members
also considered their experiences as directors or trustees of the Fund and other
funds advised by the Manager. The Board received and reviewed information
regarding the quality of services provided by affiliates of the Manager, which
it also reviews at other times during the year in connection with the renewal of
the Fund's service agreements. The Board was aware that there are alternatives
to retaining the Manager.
PORTFOLIO MANAGEMENT SERVICES AND PERFORMANCE. In its evaluation of the
quality of the portfolio management services to provided, the Board considered
the experience of Dimitrios Kourkoulakos and the Manager's high yield team and
analysts. Mr. Kour-koulakos is the Fund's portfolio manager and has been the
person primarily responsible for the day-to-day management of the Fund's
portfolio since June 2002; he shared that responsibility as co-portfolio manager
from February 5, 2003 to April 19, 2004. Mr. Kour-koulakos has been a Vice
President of the Manager since December 2001 and was a High Yield Analyst from
1998 to 2001 and a Securities Analyst from 1995 to 1998 with the
65 | OPPENHEIMER HIGH YIELD FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited / Continued
- --------------------------------------------------------------------------------
Manager. He is also a portfolio manager and an officer of other portfolios in
the OppenheimerFunds complex and has had over 10 years of experience managing
fixed income investments.
The Board also reviewed information, prepared by the Manager and by the
independent consultant, comparing the Fund's historical performance to relevant
market indices and to the performance of other high current yield funds
(including both funds advised by the Manager and funds advised by other
investment advisers). The Board also receives and reviews comparative
performance information regarding the Fund and other funds at each Board
meeting. The Board noted that the Fund's three-year, five-year and ten-year
performance was below its peer group average. However, its one-year performance
was consistent with its peer group average. The Board observed that the Manager
had been restructuring its fixed-income department and, for other fixed income
funds, investment performance has improved. The Board also noted that the
Manager advised that it believes it has the personnel and processes in place to
improve the performance of the Fund. The Board decided that it will allow the
Manager additional time to improve the performance of the Fund and will continue
to monitor the performance of the Fund during the year.
MANAGEMENT FEES AND EXPENSES. The Board also reviewed information,
including comparative information, regarding the fees paid to the Manager and
its affiliates and the other expenses borne by the Fund. The independent
consultant provided comparative data in regard to the fees and expenses of the
Fund, other high current yield funds and other funds with comparable asset
levels and distribution features. The Board noted that the Fund's management
fees and its total expenses are lower than its peer group average. In addition,
the Board evaluated the comparability of the fees charged and the services
provided to the Fund to the fees charged and services provided to other types of
entities advised by the Manager.
PROFITABILITY OF THE MANAGER AND AFFILIATES. The Board also reviewed
information regarding the cost of services provided by the Manager and its
affiliates and the Manager's profitability. The Board considered that the
Manager must be able to pay and retain experienced professional personnel at
competitive rates to provide services to the Fund and that maintaining the
financial viability of the Manager is important in order for the Manager to
continue to provide significant services to the Fund and its shareholders. In
addition the Board considered information that was provided regarding the direct
and indirect benefits the Manager receives as a result of its relationship with
the Fund, including compensation paid to the Manager's affiliates.
66 | OPPENHEIMER HIGH YIELD FUND
ECONOMIES OF SCALE. The Board reviewed the extent to which the Manager may
realize economies of scale in managing and supporting the Fund and the current
level of Fund assets in relation to the Fund's breakpoint schedule for its
management fees. The Board considered that the Fund has not experienced recent
asset growth and that, based on current asset levels, the Fund has passed its
last management fee breakpoint.
CONCLUSIONS. These factors were also considered by the independent
Trustees meeting separately from the full Board, assisted by experienced counsel
to the Fund and to the independent Trustees. Fund counsel and the independent
Trustees' counsel are both independent of the Manager within the meaning and
intent of the Securities and Exchange Commission Rules.
Based on its review of the information it received and its evaluations
described above, the Board, including a majority of the independent Trustees,
concluded that the nature, extent and quality of the services provided to the
Fund by the Manager are a benefit to the Fund and in the best interest of the
Fund's shareholders and that the amount and structure of the compensation
received by the Manager and its affiliates are reasonable in relation to the
services provided. Accordingly, the Board elected to continue the advisory
agreement for another year. In arriving at this decision, the Board did not
single out any factor or factors as being more important than others, but
considered all of the factors together. The Board judged the terms and
conditions of the advisory agreement, including the management fee, in light of
all of the surrounding circumstances.
67 | OPPENHEIMER HIGH YIELD FUND
TRUSTEES AND OFFICERS Unaudited
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
NAME, POSITION(S) HELD WITH PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS; OTHER TRUSTEESHIPS/DIRECTORSHIPS
FUND, LENGTH OF SERVICE, AGE HELD BY TRUSTEE; NUMBER OF PORTFOLIOS IN FUND COMPLEX CURRENTLY OVERSEEN BY
TRUSTEE
INDEPENDENT THE ADDRESS OF EACH TRUSTEE IN THE CHART BELOW IS 6803 S. TUCSON WAY,
TRUSTEES CENTENNIAL, CO 80112-3924. EACH TRUSTEE SERVES FOR AN INDEFINITE TERM, UNTIL
HIS OR HER RESIGNATION, RETIREMENT, DEATH OR REMOVAL.
WILLIAM L. ARMSTRONG, Chairman of the following private mortgage banking companies: Cherry Creek
Chairman (since 2003) Mortgage Company (since 1991), Centennial State Mortgage Company (since 1994),
and Trustee (since 1999) and The El Paso Mortgage Company (since 1993); Chairman of the following private
Age: 68 companies: Ambassador Media Corporation (since 1984) and Broadway Ventures
(since 1984); Director of the following: Helmerich & Payne, Inc. (oil and gas
drilling/production company) (since 1992), Campus Crusade for Christ (since
1991) and the Bradley Foundation (since 2002); former Chairman of the following:
Transland Financial Services, Inc. (private mortgage banking company)
(1997-2003), Great Frontier Insurance (insurance agency) (1995-2000), Frontier
Real Estate, Inc. (residential real estate brokerage) (1994-2000) and Frontier
Title (title insurance agency) (1995-2000); former Director of the following:
UNUMProvident (insurance company) (1991-2004), Storage Technology Corporation
(computer equipment company) (1991-2003) and International Family Entertainment
(television channel) (1992-1997); U.S. Senator (January 1979-January 1991).
Oversees 38 portfolios in the OppenheimerFunds complex.
ROBERT G. AVIS, Director and President of A.G. Edwards Capital, Inc. (General Partner of
Trustee (since 1999) private equity funds) (until February 2001); Chairman, President and Chief
Age: 74 Executive Officer of A.G. Edwards Capital, Inc. (until March 2000); Director
of A.G. Edwards & Sons, Inc. (brokerage company) (until 2000) and A.G.
Edwards Trust Company (investment adviser) (until 2000); Vice Chairman and
Director of A.G. Edwards, Inc. (until March 1999); Vice Chairman of A.G.
Edwards & Sons, Inc. (until March 1999); Chairman of A.G. Edwards Trust
Company (until March 1999) and A.G.E. Asset Management (investment adviser)
(until March 1999). Oversees 38 portfolios in the OppenheimerFunds complex.
GEORGE C. BOWEN, Assistant Secretary and Director of Centennial Asset Management Corporation
Trustee (since 1999) (December 1991-April 1999); President, Treasurer and Director of Centennial
Age: 68 Capital Corporation (June 1989-April 1999); Chief Executive Officer and
Director of MultiSource Services, Inc. (March 1996-April 1999); Mr. Bowen
held several positions with the Manager and with subsidiary or affiliated
companies of the Manager (September 1987-April 1999). Oversees 38 portfolios
in the OppenheimerFunds complex.
EDWARD L. CAMERON, Member of The Life Guard of Mount Vernon (George Washington historical
Trustee (since 1999) site) (since June 2000); Director of Genetic ID, Inc. (biotech company)
Age: 66 (March 2001-May 2002); Partner at PricewaterhouseCoopers LLP (accounting firm)
(July 1974-June 1999); Chairman of Price Waterhouse LLP Global Investment Management
Industry Services Group (July 1994-June 1998). Oversees 38 portfolios in the
OppenheimerFunds complex.
JON S. FOSSEL, Director of UNUMProvident (insurance company) (since June 2002); Director of
Trustee (since 1999) Northwestern Energy Corp. (public utility corporation) (since November 2004);
Age: 63 Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of
Rocky Mountain Elk Foundation (February 1998-February 2003); Chairman and Director
(until October 1996) and President and Chief Executive Officer (until October
1995) of the Manager; President, Chief Executive Officer and Director of the
following: Oppenheimer Acquisition Corp. ("OAC") (parent holding company of the
Manager), Shareholder Services, Inc. and Shareholder Financial
68 | OPPENHEIMER HIGH YIELD FUND
JON S. FOSSEL, Services, Inc. (until October 1995). Oversees 38 portfolios in the OppenheimerFunds
Continued complex.
SAM FREEDMAN, Director of Colorado Uplift (charitable organization) (since September 1984).
Trustee (since 1999) Mr. Freedman held several positions with the Manager and with subsidiary or
Age: 64 affiliated companies of the Manager (until October 1994). Oversees 38
portfolios in the OppenheimerFunds complex.
BEVERLY L. HAMILTON, Trustee of Monterey Institute for International Studies (educational
Trustee (since 2002) organization) (since February 2000); Director of The California Endowment
Age: 58 (philanthropic organization) (since April 2002); Director of Community
Hospital of Monterey Peninsula (since February 2002); Director of Emerging
Markets Growth Fund, Inc. (mutual fund) (since October 1991); President of
ARCO Investment Management Company (February 1991-April 2000); Member of the
investment committees of The Rockefeller Foundation and The University of
Michigan; Advisor at Credit Suisse First Boston's Sprout venture capital unit
(venture capital fund) (1994- January 2005); Trustee of MassMutual Institutional
Funds (investment company) (1996-June 2004); Trustee of MML Series Investment
Fund (investment company) (April 1989-June 2004); Member of the investment
committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland)
pension fund (2000- 2003). Oversees 38 portfolios in the OppenheimerFunds complex.
ROBERT J. MALONE, Chairman, Chief Executive Officer and Director of Steele Street State Bank
Trustee (since 2002) (commercial banking) (since August 2003); Director of Colorado UpLIFT
Age: 60 (charitable organization) (since 1986); Trustee of the Gallagher Family
Foundation (non-profit organization) (since 2000); Former Chairman of U.S.
Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National
Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (REIT)
(1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and Director
of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004).
Oversees 38 portfolios in the OppenheimerFunds complex.
F. WILLIAM MARSHALL, JR., Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds)
Trustee (since 2002) (investment company) (since 1996) and MML Series Investment Fund (investment
Age: 63 company) (since 1996), the Springfield Library and Museum Association
(museums) (since 1995) and the Community Music School of Springfield (music
school) (since 1996); Chairman and Trustee (since 2003) and Chairman of the
Investment Committee (since 1994) of the Worcester Polytech Institute
(private university); President and Treasurer of the SIS Funds (private
charitable fund) (since January 1999); Chairman of SIS & Family Bank, F.S.B.
(formerly SIS Bank) (commercial bank) (January 1999-July 1999); Member of the
Investment Committee of the Community Foundation of Western Massachusetts
(1998-2003); and Executive Vice President of Peoples Heritage Financial Group,
Inc. (commercial bank) (January 1999-July 1999). Oversees 38 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE THE ADDRESS OF MR. MURPHY IN THE CHART BELOW IS TWO WORLD FINANCIAL CENTER,
AND OFFICER 225 LIBERTY STREET, 11TH FLOOR, NEW YORK, NY 10281-1008. MR. MURPHY SERVES
FOR AN INDEFINITE TERM, UNTIL HIS RESIGNATION, DEATH OR REMOVAL.
JOHN V. MURPHY, Chairman, Chief Executive Officer and Director (since June 2001) and
President and Trustee President (since September 2000) of the Manager; President and Director or
(since 2001) Trustee of other Oppenheimer funds; President and Director of OAC and of
Age: 55 Oppenheimer Partnership Holdings, Inc. (holding company subsidiary of the
Manager) (since July 2001); Director of OppenheimerFunds Distributor, Inc.
(subsidiary of the
69 | OPPENHEIMER HIGH YIELD FUND
TRUSTEES AND OFFICERS Unaudited / Continued
- --------------------------------------------------------------------------------
JOHN V. MURPHY, Manager) (since November 2001); Chairman and Director of Shareholder
Continued Services, Inc. and of Shareholder Financial Services, Inc. transfer
agent subsidiaries of the Manager) (since July 2001); President and
Director of OppenheimerFunds Legacy Program (charitable trust program
established by the Manager) (since July 2001); Director of the following
investment advisory subsidiaries of the Manager: OFI Institutional Asset
Management, Inc., Centennial Asset Management Corporation, Trinity Investment
Management Corporation and Tremont Capital Management, Inc. (since November
2001), HarbourView Asset Management Corporation and OFI Private Investments,
Inc. (since July 2001); President (since November 2001) and Director (since
July 2001) of Oppenheimer Real Asset Management, Inc.; Executive Vice President
of Massachusetts Mutual Life Insurance Company (OAC's parent company) (since
February 1997); Director of DLB Acquisition Corporation (holding company parent
of Babson Capital Management LLC) (since June 1995); Member of the Investment Company
Institute's Board of Governors (since October 3, 2003); Chief Operating
Officer of the Manager (September 2000-June 2001); President and Trustee of
MML Series Investment Fund and MassMutual Select Funds (open-end investment
companies) (November 1999-November 2001); Director of C.M. Life Insurance
Company (September 1999-August 2000); President, Chief Executive Officer and
Director of MML Bay State Life Insurance Company (September 1999-August
2000); Director of Emerald Isle Bancorp and Hibernia Savings Bank
(wholly-owned subsidiary of Emerald Isle Bancorp) (June 1989-June 1998).
Oversees 66 portfolios as a trustee or director and 20 additional portfolios
as officer in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------------------------------
OFFICERS THE ADDRESS OF THE OFFICERS IN THE CHART BELOW IS AS FOLLOWS: FOR MR.
KOURKOULAKOS, TWO WORLD FINANCIAL CENTER, 225 LIBERTY STREET, 11TH FLOOR, NEW
YORK, NY 10281-1008, FOR MESSRS. VANDEHEY AND WIXTED, 6803 S. TUCSON WAY,
CENTENNIAL, CO 80112-3924. EACH OFFICER SERVES FOR AN ANNUAL TERM OR UNTIL
HIS OR HER EARLIER RESIGNATION, DEATH OR REMOVAL.
DIMITRIOS KOURKOULAKOS, Vice President of the Manager since December 2001; an officer of 3 portfolios
Vice President (since 2002) in the OppenheimerFunds complex; formerly a High Yield Analyst (1998-2001)
Age: 37 and a Securities Analyst (1995-1998) of the Manager.
BRIAN W. WIXTED, Senior Vice President and Treasurer of the Manager (since March 1999);
Treasurer (since 1999) Treasurer of the following: HarbourView Asset Management Corporation,
Age: 45 Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer
Real Asset Management Corporation, and Oppenheimer Partnership Holdings, Inc.
(since March 1999), OFI Private Investments, Inc. (since March 2000),
OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000),
OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds
Legacy Program (since June 2003); Treasurer and Chief Financial Officer of OFI Trust
Company (trust company subsidiary of the Manager) (since May 2000); Assistant
Treasurer of the following: OAC (since March 1999), Centennial Asset Management
Corporation (March 1999-October 2003) and OppenheimerFunds Legacy Program (April
2000-June 2003); Principal and Chief Operating Officer of Bankers Trust Company-Mutual
Fund Services Division (March 1995-March 1999). An officer of 86 portfolios in the
OppenheimerFunds complex.
70 | OPPENHEIMER HIGH YIELD FUND
ROBERT G. ZACK, Executive Vice President (since January 2004) and General Counsel (since
Vice President & Secretary March 2002) of the Manager; General Counsel and Director of the Distributor
(since 2001) (since December 2001); General Counsel of Centennial Asset Management
Age: 56 Corporation (since December 2001); Senior Vice President and General Counsel
of HarbourView Asset Management Corporation (since December 2001); Secretary
and General Counsel of OAC (since November 2001); Assistant Secretary (since
September 1997) and Director (since November 2001) of OppenheimerFunds
International Ltd. and OppenheimerFunds plc; Vice President and Director of
Oppenheimer Partnership Holdings, Inc. (since December 2002); Director of
Oppenheimer Real Asset Management, Inc. (since November 2001); Senior Vice
President, General Counsel and Director of Shareholder Financial Services,
Inc. and Shareholder Services, Inc. (since December 2001); Senior Vice
President, General Counsel and Director of OFI Private Investments, Inc. and
OFI Trust Company (since November 2001); Vice President of OppenheimerFunds
Legacy Program (since June 2003); Senior Vice President and General Counsel
of OFI Institutional Asset Management, Inc. (since November 2001); Director
of OppenheimerFunds (Asia) Limited (since December 2003); Senior Vice
President (May 1985-December 2003), Acting General Counsel (November
2001-February 2002) and Associate General Counsel (May 1981-October 2001) of
the Manager; Assistant Secretary of the following: Shareholder Services, Inc.
(May 1985-November 2001), Shareholder Financial Services, Inc. (November
1989-November 2001), and OppenheimerFunds International Ltd. (September
1997-November 2001). An officer of 86 portfolios in the OppenheimerFunds
complex.
MARK S. VANDEHEY, Senior Vice President and Chief Compliance Officer of the Manager (since
Vice President and Chief March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial
Compliance Officer Asset Management Corporation and Shareholder Services, Inc. (since June
(since 2004) 1983); Vice President and Director of Internal Audit of the Manager
Age: 54 (1997-February 2004). An officer of 86 portfolios in the OppenheimerFunds
complex.
THE FUND'S STATEMENT OF ADDITIONAL INFORMATION CONTAINS ADDITIONAL INFORMATION
ABOUT THE FUND'S TRUSTEES AND IS AVAILABLE WITHOUT CHARGE UPON REQUEST.
71 | OPPENHEIMER HIGH YIELD FUND
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller or persons performing similar functions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Board of Trustees of the registrant has determined that Edward L. Cameron,
the Chairman of the Board's Audit Committee, and George C. Bowen, a member of
the Board's Audit Committee, possess the technical attributes identified in
Instruction 2(b) of Item 3 to Form N-CSR to qualify as "audit committee
financial experts," and has designated Messrs. Cameron and
Bowen as the Audit Committee's financial experts. Messrs. Cameron and Bowen are
"independent" Trustees pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees
The principal accountant for the audit of the registrant's annual financial
statements billed $41,000 in fiscal 2005 and $38,000 in fiscal 2004.
(b) Audit-Related Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees in fiscal 2005 and $5,525 in fiscal 2004 to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
Such services include: internal control reviews.
(c) Tax Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years to the registrant's investment adviser or any entity controlling,
controlled by, or under common control with the adviser that provides ongoing
services to the registrant.
(d) All Other Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
(e) (1) During its regularly scheduled periodic meetings, the registrant's
audit committee will pre-approve all audit, audit-related, tax and other
services to be provided by the principal accountants of the registrant.
The audit committee has delegated pre-approval authority to its Chairman
for any subsequent new engagements that arise between regularly scheduled
meeting dates provided that any fees such pre-approved are presented to
the audit committee at its next regularly scheduled meeting.
Under applicable laws, pre-approval of non-audit services maybe waived
provided that: 1) the aggregate amount of all such services provided
constitutes no more than five percent of the total amount of fees paid by
the registrant to it principal accountant during the fiscal year in which
services are provided 2) such services were not recognized by the
registrant at the time of engagement as non-audit services and 3) such
services are promptly brought to the attention of the audit committee of
the registrant and approved prior to the completion of the audit.
(2) 100%
(f) Not applicable as less than 50%.
(g) The principal accountant for the audit of the registrant's annual
financial statements billed no such fees in fiscal 2005 and $5,525 in
fiscal 2004 to the registrant and the registrant's investment adviser or
any entity controlling, controlled by, or under common control with the
adviser that provides ongoing services to the registrant related to
non-audit fees. Those billings did not include any prohibited non-audit
services as defined by the Securities Exchange Act of 1934.
(h) The registrant's audit committee of the board of trustees has considered
whether the provision of non-audit services that were rendered to the
registrant's investment adviser, and any entity controlling, controlled
by, or under common control with the investment adviser that provides
ongoing services to the registrant that were not pre-approved pursuant to
paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
THE FUNDS' GOVERNANCE COMMITTEE PROVISIONS WITH RESPECT TO NOMINATIONS OF
DIRECTORS/TRUSTEES TO THE RESPECTIVE BOARDS
1. The Funds' Governance Committee (the "Committee") will evaluate
potential Board candidates to assess their qualifications. The
Committee shall have the authority, upon approval of the Board, to
retain an executive search firm to assist in this effort. The
Committee may consider recommendations by business and personal
contacts of current Board members and by executive search firms
which the Committee may engage from time to time and may also
consider shareholder recommendations. The Committee may consider
the advice and recommendation of the Funds' investment manager and
its affiliates in making the selection.
2. The Committee shall screen candidates for Board membership. The
Committee has not established specific qualifications that it
believes must be met by a trustee nominee. In evaluating trustee
nominees, the Committee considers, among other things, an
individual's background, skills, and experience; whether the
individual is an "interested person" as defined in the Investment
Company Act of 1940; and whether the individual would be deemed an
"audit committee financial expert" within the meaning of applicable
SEC rules. The Committee also considers whether the individual's
background, skills, and experience will complement the background,
skills, and experience of other nominees and will contribute to the
Board. There are no differences in the manner in which the
Committee evaluates nominees for trustees based on whether the
nominee is recommended by a shareholder.
3. The Committee may consider nominations from shareholders for the
Board at such times as the Committee meets to consider new nominees
for the Board. The Committee shall have the sole discretion to
determine the
candidates to present to the Board and, in such cases where
required, to shareholders. Recommendations for trustee nominees
should, at a minimum, be accompanied by the following:
o the name, address, and business, educational, and/or
other pertinent background of the person being
recommended;
o a statement concerning whether the person is an
"interested person" as defined in the Investment
Company Act of 1940;
o any other information that the Funds would be required
to include in a proxy statement concerning the person
if he or she was nominated; and
o the name and address of the person submitting the
recommendation and, if that person is a shareholder,
the period for which that person held Fund shares.
The recommendation also can include any additional information
which the person submitting it believes would assist the Committee
in evaluating the recommendation.
4. Shareholders should note that a person who owns securities issued
by Massachusetts Mutual Life Insurance Company (the parent company
of the Funds' investment adviser) would be deemed an "interested
person" under the Investment Company Act of 1940. In addition,
certain other relationships with Massachusetts Mutual Life
Insurance Company or its subsidiaries, with registered
broker-dealers, or with the Funds' outside legal counsel may cause
a person to be deemed an "interested person."
5. Before the Committee decides to nominate an individual as a
trustee, Committee members and other directors customarily
interview the individual in person. In addition, the individual
customarily is asked to complete a detailed questionnaire which is
designed to elicit information which must be disclosed under SEC
and stock exchange rules and to determine whether the individual is
subject to any statutory disqualification from serving as a trustee
of a registered investment company.
ITEM 11. CONTROLS AND PROCEDURES.
Based on their evaluation of the registrant's disclosure controls and
procedures (as defined in rule 30a-3(c) under the Investment Company Act of
1940 (17 CFR 270.30a-3(c)) as of June 30, 2005, the registrant's principal
executive officer and principal financial officer found the registrant's
disclosure controls and procedures to provide reasonable assurances that
information
required to be disclosed by the 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.
There have been no changes in the registrant's internal controls over financial
reporting that occurred during the registrant's second fiscal quarter of the
period covered by this report that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over financial
reporting.
ITEM 12. EXHIBITS.
(a) (1) Exhibit attached hereto.
(2) Exhibits attached hereto.
(3) Not applicable.
(b) Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
Oppenheimer High Yield Fund
By: /s/John V. Murphy
-----------------
John V. Murphy
Principal Executive Officer
Date: August 10, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/John V. Murphy
-----------------
John V. Murphy
Principal Executive Officer
Date: August 10, 2005
By: /s/Brian W. Wixted
-----------------
Brian W. Wixted
Principal Financial Officer
Date: August 10, 2005