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: 811-8246
Exact name of registrant as specified in charter:
Delaware Investments Global Dividend and Income Fund, Inc.
Address of principal executive offices:
2005 Market Street
Philadelphia, PA 19103
Name and address of agent for service:
Richelle S. Maestro, Esq.
2005 Market Street
Philadelphia, PA 19103
Registrant's telephone number, including area code: (800) 523-1918
Date of fiscal year end: November 30
Date of reporting period: May 31, 2004
Item 1. Reports to Stockholders
Delaware
Investments(SM)
--------------------------------------
A member of Lincoln Financial Group(R)
CLOSED END
SEMIANNUAL REPORT MAY 31, 2004
- --------------------------------------------------------------------------------
DELAWARE INVESTMENTS
GLOBAL DIVIDEND AND INCOME FUND, INC.
[LOGO OMITTED] POWERED BY RESEARCH.(SM)
TABLE
OF CONTENTS
- ---------------------------------------------------------
FINANCIAL STATEMENTS:
Statement of Net Assets 1
Statement of Operations 7
Statements of Changes in Net Assets 8
Statement of Cash Flows 9
Financial Highlights 10
Notes to Financial Statements 11
- ---------------------------------------------------------
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested.
Mutual fund advisory services provided by Delaware Management Company, a series
of Delaware Management Business Trust, and Delaware International Advisers Ltd.,
which are both registered investment advisors.
(C) 2004 Delaware Distributors, L.P.
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS May 31, 2004 (Unaudited)
Number of Market
Shares Value (U.S.$)
COMMON STOCK - 73.00%
Automobiles & Automotive Parts - 1.96%
General Motors 10,200 $ 462,978
GKN 75,215 315,798
Goodrich (B.F.) 23,500 658,705
-----------
1,437,481
-----------
Banking, Finance & Insurance - 15.18%
*American Home Mortgage Investment 28,000 714,000
Aviva 62,582 611,569
Banca Intesa 122,699 440,511
Banco Santander Central Hispano 39,771 422,042
Bank of America 8,300 689,979
+++Fieldstone Investments 144A 25,000 431,250
Friedman Billings Ramsey Group Class A 25,940 505,830
HBOS 54,179 709,248
ING Groep NV 27,494 620,453
J.P. Morgan Chase 14,500 534,180
Lloyds TSB Group 87,256 689,112
MBNA 36,400 924,560
Mellon Financial 20,700 609,408
Morgan Stanley 15,800 845,458
National Australia Bank 27,457 589,759
Overseas Chinese Banking 41,000 289,284
Societe Generale Class A 5,887 498,910
++Sunset Financial Resources 31,200 325,416
Wells Fargo 11,400 670,320
-----------
11,121,289
-----------
Building & Materials - 1.29%
Compagnie de Saint Gobain 12,800 644,768
Wharf Holdings 106,000 299,208
-----------
943,976
-----------
Cable, Media & Publishing - 0.05%
++XM Satellite Radio Class A 1,500 37,770
-----------
37,770
-----------
Chemicals - 2.78%
Bayer 22,875 651,975
BOC Group 10,290 167,626
Dow Chemical 25,500 1,017,451
Orica 19,167 200,376
-----------
2,037,428
-----------
Computers & Technology - 1.69%
++Intuit 15,700 615,126
Pitney Bowes 14,100 625,053
-----------
1,240,179
-----------
Consumer Products - 0.62%
Procter & Gamble 4,200 452,844
-----------
452,844
-----------
Electronics & Electrical Equipment - 2.26%
Emerson Electric 10,000 597,000
General Electric 20,100 625,512
Hong Kong Electric 103,000 430,824
-----------
1,653,336
-----------
Energy - 5.51%
BP Amoco 51,154 449,011
ChevronTexaco 8,300 750,320
Exxon Mobil 11,800 510,350
Kerr-McGee 11,600 571,300
Number of Market
Shares Value (U.S.$)
COMMON STOCK (continued)
Energy (continued)
++Petroleum Geo-Services ADR 397 $ 14,611
Royal Dutch Petroleum 13,709 686,371
Sasol 27,194 412,606
Total 3,440 645,656
-----------
4,040,225
-----------
Food, Beverage & Tobacco - 4.94%
Anheuser-Busch 15,500 825,685
Foster's Group 191,687 623,753
General Mills 14,300 658,515
Kellogg 14,500 614,800
Mitchells & Butlers 29,029 137,715
PepsiCo 14,200 757,854
-----------
3,618,322
-----------
Healthcare & Pharmaceuticals - 5.54%
Abbott Laboratories 12,500 515,125
Eisai 9,400 244,090
GlaxoSmithKline 34,722 727,646
++Hospira 1,250 32,050
Merck & Co. 10,400 491,920
Pfizer 17,200 607,848
Takeda Chemical Industries 9,400 390,373
++Tenet Healthcare 54,700 652,024
Wyeth 11,000 396,000
-----------
4,057,076
-----------
Industrial Machinery - 0.38%
Brambles Industries 71,495 277,240
-----------
277,240
-----------
Investment Companies - 0.80%
*Gladstone Capital 29,200 586,920
-----------
586,920
-----------
Leisure, Lodging & Entertainment - 0.54%
Intercontinental Hotels Group 41,125 393,968
-----------
393,968
-----------
Metals & Mining - 0.62%
Rio Tinto 18,880 453,464
-----------
453,464
-----------
Paper & Forest Products - 2.40%
Amcor 78,646 366,475
International Paper 16,400 687,652
UPM-Kymmene Oyj 13,900 249,518
Weyerhaeuser 7,500 453,600
-----------
1,757,245
-----------
Real Estate - 13.58%
AMB Property 18,300 604,815
Apartment Investment & Management 14,500 418,760
BRE Properties Class A 11,100 384,060
Camden Property Trust 4,400 205,524
Duke Realty 26,000 841,360
General Growth Properties 73,110 2,147,972
Liberty Property Trust 21,042 839,365
+++Medical Properties Trust 144A 9,400 94,000
Pan Pacific Retail Properties 17,600 809,600
Prentiss Properties Trust 21,308 703,164
Ramco-Gershenson Properties 31,300 757,460
Reckson Associates Realty 25,000 650,500
1
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS (CONTINUED)
Number of Market
Shares Value (U.S.$)
COMMON STOCK (continued)
Real Estate (continued)
Simon Property Group 8,000 $ 412,560
Starwood Hotels & Resorts Worldwide 21,700 915,306
Sun Communities 4,400 162,712
----------
9,947,158
----------
Retail - 2.45%
Boots 44,819 541,523
Coles Myer 91,055 551,653
GUS 43,481 646,531
*++Kmart Holdings 1,053 55,230
----------
1,794,937
----------
Technology/Semiconductors - 0.89%
Intel 22,900 653,795
----------
653,795
----------
Telecommunications - 3.95%
Alltel 19,600 992,348
Telecom Corporation of New Zealand 189,000 660,295
Telefonica 45,877 665,551
Telstra 172,136 576,102
----------
2,894,296
----------
Transportation & Shipping - 0.33%
West Japan Railway 63 244,533
----------
244,533
----------
Utilities - 5.24%
BG Group 66,367 404,892
Dominion Resources 8,900 560,433
Electrabel 1,376 448,473
FPL Group 13,100 835,125
Hong Kong & China Gas 104,000 164,128
Iberdrola 29,226 589,588
RWE 19,081 837,662
----------
3,840,301
----------
TOTAL COMMON STOCK (cost $43,738,588) 53,483,783
----------
CONVERTIBLE PREFERRED STOCK - 2.31%
Aerospace & Defense - 0.55%
Northrop Grumman 7.25% 3,850 400,785
----------
400,785
----------
Banking, Finance & Insurance - 0.74%
Chubb 7.00% 4,000 111,160
Travelers Property Casualty 4.50% 12,000 286,320
XL Capital 6.50% 6,000 150,240
----------
547,720
----------
Environmental Services - 0.39%
Allied Waste Industries 6.25% 4,000 288,760
----------
288,760
----------
Telecommunications - 0.63%
Lucent Technologies Capital Trust I 7.75% 400 458,676
----------
458,676
----------
TOTAL CONVERTIBLE PREFERRED STOCK
(cost $1,661,000) 1,695,941
----------
Number of Market
Shares Value (U.S.$)
PREFERRED STOCK - 3.52%
Leisure, Lodging & Entertainment - 0.54%
WestCoast Hospitality Capital Trust 9.50% 15,700 $ 396,896
----------
396,896
----------
Metals & Mining - 0.01%
++Weirton Steel 8,550 5,729
----------
5,729
----------
Real Estate - 2.36%
Equity Inns Series B 8.75% 10,000 250,000
LaSalle Hotel Properties 10.25% 23,500 629,564
Ramco-Gershenson Properties 9.50% 11,500 305,038
SL Green Realty 7.625% 22,000 541,750
----------
1,726,352
----------
Utilities - 0.61%
Public Service Enterprise Group 10.25% 6,800 392,700
TNP Enterprises PIK 14.50% 468 54,185
----------
446,885
----------
TOTAL PREFERRED STOCK (cost $2,520,930) 2,575,862
----------
Principal
Amount***
CONVERTIBLE BONDS - 3.48%
Computers & Technology - 0.37%
+Mercury Interactive 144A
4.75% 7/1/07 USD 275,000 272,250
-------------
272,250
-------------
Leisure, Lodging & Entertainment - 0.20%
*+Regal Entertainment Group 144A
3.75% 5/15/08 USD 130,000 149,825
-------------
149,825
-------------
Miscellaneous - 0.19%
+Tyco International Group 144A
2.75% 1/15/18 USD 100,000 142,500
-------------
142,500
-------------
Real Estate - 0.49%
Meristar Hospitality 9.50% 4/1/10 USD 300,000 359,625
-------------
359,625
-------------
Retail - 1.24%
+Gap 144A 5.75% 3/15/09 USD 500,000 778,750
+Saks 144A 2.00% 3/15/24 USD 125,000 126,406
-------------
905,156
-------------
Telecommunications - 0.62%
+Nextel Partners 144A
1.50% 11/15/08 USD 200,000 452,250
-------------
452,250
-------------
Transportation & Shipping - 0.07%
+ExpressJet Holdings 144A
4.25% 8/1/23 USD 50,000 48,250
-------------
48,250
-------------
Utilities - 0.30%
+Centerpoint Energy 144A
3.75% 5/15/23 USD 200,000 221,000
-------------
221,000
-------------
TOTAL CONVERTIBLE BONDS (cost $1,879,663) 2,550,856
-------------
2
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS (CONTINUED)
Principal Market
Amount*** Value (U.S.$)
BONDS - 41.53%
Aerospace & Defense - 0.10%
Armor Holdings 8.25% 8/15/13 USD 70,000 $ 75,075
----------
75,075
----------
Agency - 1.57%
Fannie Mae Global 2.125% 10/9/07 JPY 120,000,000 1,147,602
----------
1,147,602
----------
Automobiles & Automotive Parts - 0.22%
#+Advanced Accessory Holdings 144A
13.25% 12/15/11 USD 130,000 69,550
Advanced Accessory Systems
10.75% 6/15/11 USD 40,000 40,400
*Collins & Aikman Products
11.50% 4/15/06 USD 50,000 48,750
----------
158,700
----------
Banking, Finance & Insurance - 2.70%
BF Saul 7.50% 3/1/14 USD 25,000 24,688
*Bluewater Finance 10.25% 2/15/12 USD 60,000 61,800
+Farmers Exchange Capital 144A
7.20% 7/15/48 USD 70,000 65,240
+LaBranche 144A 11.00% 5/15/12 USD 80,000 82,000
Oesterreichische Kontrollbank
1.80% 3/22/10 JPY 150,000,000 1,439,145
^SL Finance 6.375% 7/12/22 EUR 80,000 104,528
Stena 9.625% 12/1/12 USD 90,000 101,250
*+UGS 144A 10.00% 6/1/12 USD 30,000 31,650
^Zurich Finance 5.75% 10/2/23 EUR 50,000 62,941
----------
1,973,242
----------
Buildings & Materials - 0.43%
+Aearo 144A 8.25% 4/15/12 USD 40,000 40,600
Interface 10.375% 2/1/10 USD 75,000 83,625
*Interline Brands 11.50% 5/15/11 USD 75,000 80,250
+Lone Star Industries 144A
8.85% 6/15/05 USD 60,000 62,706
Standard Pacific 7.75% 3/15/13 USD 50,000 50,000
----------
317,181
----------
Business Services - 0.08%
Brickman Group 11.75% 12/15/09 USD 50,000 57,250
----------
57,250
----------
Cable, Media & Publishing - 1.75%
+Atlantic Broadband Finance 144A
9.375% 1/15/14 USD 125,000 117,500
*Charter Communications
10.75% 10/1/09 USD 250,000 218,749
CSC Holdings 10.50% 5/15/16 USD 135,000 152,888
Dex Media East 12.125% 11/15/12 USD 45,000 52,425
+Echostar DBS 144A 5.75% 10/1/08 USD 115,000 112,988
+Hollinger 144A 11.875% 3/1/11 USD 40,000 45,650
*Lodgenet Entertainment
9.50% 6/15/13 USD 90,000 98,550
PanAmSat 8.50% 2/1/12 USD 75,000 84,375
PEI Holdings 11.00% 3/15/10 USD 85,000 98,175
Rogers Cablesystems 10.00% 3/15/05 USD 100,000 105,500
+Sheridan Acquisition 144A
10.25% 8/15/11 USD 65,000 68,575
XM Satellite Radio 12.00% 6/15/10 USD 115,000 129,375
----------
1,284,750
----------
Principal Market
Amount*** Value (U.S.$)
BONDS (continued)
Chemicals - 0.60%
Huntsman International
9.875% 3/1/09 USD 50,000 $ 54,250
10.125% 7/1/09 USD 90,000 92,700
*+Nalco 144A 8.875% 11/15/13 USD 55,000 57,750
*Resolution Performance Products
8.00% 12/15/09 USD 50,000 51,625
*+Rhodia 144A 8.875% 6/1/11 USD 125,000 96,250
*[check mark]Solutia 6.72% 10/15/37 USD 175,000 84,875
--------
437,450
--------
Computers & Technology - 0.45%
Activant Solutions 10.50% 6/15/11 USD 45,000 47,475
*Amkor Technology 9.25% 2/15/08 USD 85,000 89,888
ChipPac International
12.75% 8/1/09 USD 55,000 60,225
Northern Telecom Capital
7.875% 6/15/26 USD 85,000 73,950
+Stratus Technologies 144A
10.375% 12/1/08 USD 60,000 59,100
--------
330,638
--------
Consumer Products - 0.34%
Hines Nurseries 10.25% 10/1/11 USD 40,000 42,800
Remington Arms 10.50% 2/1/11 USD 75,000 72,750
+Samsonite 144A 8.875% 6/1/11 USD 60,000 60,900
#+Town Sports International 144A
11.00% 2/1/14 USD 150,000 74,250
--------
250,700
--------
Consumer Services - 0.17%
Alderwoods Group 12.25% 1/2/09 USD 100,000 111,000
Corrections Corporation of America
9.875% 5/1/09 USD 15,000 16,650
--------
127,650
--------
Energy - 0.48%
El Paso Production Holding
7.75% 6/1/13 USD 115,000 109,250
+Hilcorp Energy/Finance 144A
10.50% 9/1/10 USD 85,000 93,288
Petroleum Geo-Services
8.00% 11/5/06 USD 40,031 40,832
10.00% 11/5/10 USD 104,981 108,130
--------
351,500
--------
Environmental Services - 0.28%
+Geo 144A 11.00% 5/15/12 USD 80,000 81,400
IESI 10.25% 6/15/12 USD 115,000 124,775
--------
206,175
--------
Food, Beverage & Tobacco - 0.96%
B&G Foods 9.625% 8/1/07 USD 195,000 199,387
Chiquita Brands International
10.56% 3/15/09 USD 100,000 109,125
+Commonwealth Brands 144A
10.625% 9/1/08 USD 90,000 93,150
+Gold Kist 144A 10.25% 3/15/14 USD 35,000 36,750
+Le-Natures 144A 9.50% 6/15/13 USD 85,000 87,125
National Beef Packing
10.50% 8/1/11 USD 35,000 37,625
PPC Escrow 9.25% 11/15/13 USD 60,000 62,700
*+Standard Commercial 144A
8.00% 4/15/12 USD 75,000 76,875
3
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS (CONTINUED)
Principal Market
Amount*** Value (U.S.$)
BONDS (continued)
Food, Beverage & Tobacco (continued)
[check mark]Venture Holdings Trust
12.00% 6/1/09 USD 95,000 $ 594
----------
703,331
----------
Foreign Government - 23.24%
Belgium Government 5.75% 9/28/10 EUR 1,100,000 1,482,444
Canadian Government 0.70% 3/20/06 JPY 150,000,000 1,369,606
Deutschland Republic
5.00% 7/4/11 EUR 890,000 1,154,053
6.25% 1/4/24 EUR 350,000 501,532
France Government Bond O.A.T.
4.00% 10/25/09 EUR 210,000 260,658
4.00% 4/25/13 EUR 1,200,000 1,440,178
5.50% 4/25/10 EUR 1,000,000 1,331,900
Hellenic Republic 8.60% 3/26/08 EUR 200,000 289,767
Kingdom of Spain 3.10% 9/20/06 JPY 45,000,000 433,024
Poland Government
5.00% 10/24/13 PLZ 6,000,000 1,336,671
6.00% 5/24/09 PLZ 500,000 123,666
8.50% 2/12/05 PLZ 1,200,000 319,537
Queensland Treasury
6.00% 7/14/09 AUD 1,300,000 935,096
6.00% 8/14/13 AUD 1,500,000 1,064,855
Republic of Austria 4.00% 7/15/09 EUR 450,000 559,429
Republic of Italy
0.375% 10/10/06 JPY 70,000,000 634,252
3.75% 6/8/05 JPY 41,000,000 384,572
Swedish Government
5.00% 1/28/09 SEK 6,700,000 939,434
5.50% 10/8/12 SEK 5,000,000 715,812
6.75% 5/5/14 SEK 4,750,000 741,791
U.K. Treasury 5.75% 12/7/09 GBP 350,000 660,076
8.00% 12/7/15 GBP 150,000 343,557
----------
17,021,910
----------
Healthcare & Pharmaceuticals - 0.23%
+Ameripath 144A 10.50% 4/1/13 USD 90,000 90,900
+Curative Health Services 144A
10.75% 5/1/11 USD 55,000 53,900
+VWR International 144A 8.00% 4/15/14 USD 25,000 25,188
----------
169,988
----------
Industrial Machinery - 0.16%
*Foster Wheeler 6.75% 11/15/05 USD 60,000 54,600
+MAAX 144A 9.75% 6/15/12 USD 60,000 61,800
----------
116,400
----------
Leisure, Lodging & Entertainment - 1.41%
Ameristar Casinos 10.75% 2/15/09 USD 80,000 91,600
+Aztar 144A 7.875% 6/15/14 USD 145,000 146,087
Felcor Lodging 10.00% 9/15/08 USD 60,000 64,350
Hard Rock Hotel 8.875% 6/1/13 USD 60,000 60,900
Herbst Gaming
10.75% 9/1/08 USD 65,000 75,075
+144A 8.125% 6/1/12 USD 130,000 130,975
Mandalay Resort Group
10.25% 8/1/07 USD 15,000 16,875
Penn National Gaming
8.875% 3/15/10 USD 85,000 91,375
Royal Caribbean Cruises
7.25% 3/15/18 USD 95,000 91,200
Principal Market
Amount*** Value (U.S.$)
BONDS (continued)
Leisure, Lodging & Entertainment (continued)
Station Casinos 6.50% 2/1/14 USD 40,000 $ 37,500
+Warner Music Group 144A 7.375% 4/15/14 USD 140,000 137,200
Wheeling Island Gaming 10.125% 12/15/09 USD 85,000 89,888
-------------
1,033,025
-------------
Metals & Mining - 0.47%
AK Steel 7.75% 6/15/12 USD 70,000 61,600
+Autocam 144A 10.875% 6/15/14 USD 85,000 83,938
+Ispat Inland 144A 9.75% 4/1/14 USD 100,000 102,750
*[check mark]#Weirton Steel 0.50% 4/1/08 USD 522,500 99,275
-------------
347,563
-------------
Packaging & Containers - 0.57%
AEP Industries 9.875% 11/15/07 USD 50,000 51,250
Consolidated Container
10.125% 7/15/09 USD 80,000 70,800
#+144A 10.75% 6/15/09 USD 80,000 60,000
Pliant 11.125% 9/1/09 USD 55,000 58,575
*+Portola Packaging 144A 8.25% 2/1/12 USD 80,000 67,200
Radnor Holdings
*11.00% 3/15/10 USD 60,000 51,900
^+144A 7.92% 4/15/09 USD 60,000 60,300
-------------
420,025
-------------
Paper & Forest Products - 1.15%
Abitibi-Consolidated 6.95% 12/15/06 USD 55,000 56,592
+Ainsworth Lumber 144A
6.75% 3/15/14 USD 65,000 60,288
Bowater 9.00% 8/1/09 USD 100,000 108,794
*Buckeye Technologies
8.00% 10/15/10 USD 95,000 88,825
Fort James 7.75% 11/15/23 USD 235,000 242,050
*+Newark Group 144A 9.75% 3/15/14 USD 95,000 90,250
+Port Townsend Paper 144A
11.00% 4/15/11 USD 85,000 84,150
Potlatch 12.50% 12/1/09 USD 95,000 114,207
-------------
845,156
-------------
Real Estate - 0.19%
Tanger Properties
7.875% 10/24/04 USD 60,000 60,900
9.125% 2/15/08 USD 70,000 77,175
-------------
138,075
-------------
Restaurants - 0.31%
[check mark]Avado Brands 9.75% 6/1/06 USD 45,000 18,000
Denny's 12.75% 9/30/07 USD 65,000 68,575
+O'Charleys 144A 9.00% 11/1/13 USD 80,000 82,400
+VICORP Restaurants 144A
10.50% 4/15/11 USD 60,000 59,700
-------------
228,675
-------------
Retail - 0.37%
*J Crew Operating 10.375% 10/15/07 USD 100,000 100,500
*Office Depot 10.00% 7/15/08 USD 100,000 116,000
Petco Animal Supplies 10.75% 11/1/11 USD 45,000 51,075
-------------
267,575
-------------
Telecommunications - 0.71%
Alaska Communications Systems
9.875% 8/15/11 USD 75,000 76,875
4
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS (CONTINUED)
Principal Market
Amount*** Value (U.S.$)
BONDS (continued)
Telecommunications (continued)
Centennial Cellular Operating
10.125% 6/15/13 USD 95,000 $ 97,375
Cincinnati Bell 8.375% 1/15/14 USD 55,000 49,500
Citizens Communications
8.50% 5/15/06 USD 20,000 21,359
+Inmarsat Finance 144A
7.625% 6/30/12 USD 30,000 29,775
+iPCS Escrow 144A 11.50% 5/1/12 USD 40,000 40,600
*MetroPCS 10.75% 10/1/11 USD 80,000 85,600
*+Qwest Services 144A
13.50% 12/15/10 USD 105,000 121,538
-----------
522,622
-----------
Textiles, Apparel & Furniture - 0.15%
Warnaco 8.875% 6/15/13 USD 100,000 106,250
-----------
106,250
-----------
Transportation & Shipping - 0.69%
Hornbeck Offshore Services
10.625% 8/1/08 USD 50,000 54,750
*Kansas City Southern Railway
9.50% 10/1/08 USD 150,000 164,250
Ocean Rig Norway 10.25% 6/1/08 USD 65,000 64,675
OMI 7.625% 12/1/13 USD 80,000 78,000
Overseas Shipholding Group
8.25% 3/15/13 USD 35,000 37,669
Seabulk International 9.50% 8/15/13 USD 100,000 103,125
----------
502,469
----------
Utilities - 1.75%
Avista 9.75% 6/1/08 USD 100,000 119,059
Calpine
*8.25% 8/15/05 USD 25,000 21,750
10.50% 5/15/06 USD 110,000 85,250
*+144A 8.75% 7/15/13 USD 120,000 100,500
Cogentrix Energy 8.75% 10/15/08 USD 85,000 88,613
*+Dynegy Holdings 144A
10.125% 7/15/13 USD 150,000 159,749
Edison Mission 9.875% 4/15/11 USD 45,000 45,450
El Paso Natural Gas 7.625% 8/1/10 USD 45,000 45,675
Elwood Energy 8.159% 7/5/26 USD 32,040 32,361
Midland Funding II 11.75% 7/23/05 USD 27,493 28,456
Midwest Generation
8.30% 7/2/09 USD 100,000 100,000
+144A 8.75% 5/1/34 USD 90,000 89,100
[chechmark]Mirant Americas Generation
7.625% 5/1/06 USD 80,000 57,200
+NRG Energy 144A 8.00% 12/15/13 USD 15,000 15,038
Orion Power Holdings 12.00% 5/1/10 USD 50,000 61,750
PSEG Energy Holdings 7.75% 4/16/07 USD 50,000 52,250
Reliant Energy 9.50% 7/15/13 USD 50,000 53,250
Sonat 6.875% 6/1/05 USD 40,000 40,000
Tennessee Gas Pipeline
8.375% 6/15/32 USD 70,000 67,900
[chechmark]+USGen New England 144A
7.459% 1/2/15 USD 50,000 21,250
----------
1,284,601
----------
TOTAL BONDS (cost $29,158,166) 30,425,578
----------
Principal Market
Amount*** Value (U.S.$)
MUNICIPAL BONDS - 0.06%
New Jersey Economic Development
Authority Special Facility Revenue
Continental Airlines Project
6.25% 9/15/29 USD 60,000 $ 44,005
----------
TOTAL MUNICIPAL BONDS (cost $50,900) 44,005
----------
Number of
Shares
WARRANTS - 0.01%
+++American Tower 144A 35 6,125
+++Solutia 144A 130 1
----------
TOTAL WARRANTS (cost $13,894) 6,126
----------
Principal
Amount***
U.S. TREASURY OBLIGATIONS - 10.74%
[solid box]U.S. Treasury Bills 0.90% 7/22/04 USD 7,880,000 7,869,897
----------
TOTAL U.S. TREASURY OBLIGATIONS
(cost $7,869,897) 7,869,897
----------
TOTAL MARKET VALUE OF SECURITIES BEFORE
SECURITIES LENDING COLLATERAL - 134.65%
(cost $86,893,038) 98,652,048
----------
SECURITIES LENDING COLLATERAL+++ - 4.98%
Abbey National
1.10% 6/07/04 USD 67,458 67,457
1.190% 10/15/04 USD 62,364 63,936
ABN AMRO Bank Chicago
1.07% 6/07/04 USD 94,291 94,291
ABN AMRO Bank Tokyo 1.10% 7/20/04 USD 67,353 67,352
Barclays 1.10% 8/19/04 USD 102,394 102,381
Bayerische Landesbank
1.154% 8/30/04 USD 53,870 53,873
CDC IXIS 1.485% 11/12/04 USD 107,750 107,764
Citibank 1.06% 7/06/04 USD 107,764 107,764
Citigroup Global Markets
1.04% 6/01/04 USD 1,104,504 1,104,504
Credit Suisse First Boston
1.60% 12/13/04 USD 107,736 107,764
Deutsche Bank Financial
1.33% 2/22/05 USD 26,936 26,961
Fortis Bank 1.10% 7/26/04 USD 135,628 135,662
General Electric Capital
1.103% 10/25/04 USD 45,819 45,871
1.118% 2/3/05 USD 40,412 40,468
1.132% 10/04/04 USD 40,417 40,450
Goldman Sachs Group
1.14% 7/20/04 USD 107,759 107,764
1.245% 12/08/04 USD 63,311 63,311
ING Bank Geneva 1.10% 9/30/04 USD 107,837 107,764
ING Bank Singapore 1.06% 6/03/04 USD 53,882 53,882
Marsh & McLennan 1.291% 6/15/04 USD 68,988 69,133
Merrill Lynch Mortgage Capital
1.163% 7/12/04 USD 107,764 107,764
Morgan Stanley Dean Witter
1.22% 6/28/05 USD 26,941 26,941
Rabobank 1.065% 3/02/05 USD 134,703 134,671
Royal Bank of Scotland
1.06% 7/02/04 USD 134,748 134,747
5
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF NET ASSETS (CONTINUED)
Principal Market
Amount*** Value (U.S.$)
SECURITIES LENDING COLLATERAL (continued)
Societe Generale New York
1.148% 12/08/04 USD 107,743 $ 107,743
Societe Generale Singapore
1.06% 6/03/04 USD 53,882 53,882
Svenska Stockholm 1.10% 8/09/04 USD 134,719 134,705
Union Bank of Switzerland
1.13% 12/20/04 USD 135,016 134,705
Wachovia Bank NA 1.127% 11/15/04 USD 107,766 107,810
Wells Fargo Bank 1.04% 6/30/04 USD 134,705 134,705
------------
TOTAL SECURITIES LENDING COLLATERAL
(cost $3,646,025) 3,646,025
------------
TOTAL MARKET VALUE OF SECURITIES - 139.63%
(cost $90,539,063) 102,298,073**
OBLIGATION TO RETURN SECURITIES
LENDING COLLATERAL - (4.98%)+++ (3,646,025)
BORROWING UNDER LINE OF CREDIT - (34.12%) (25,000,000)
LIABILITIES NET OF RECEIVABLES
AND OTHER ASSETS - (0.53%) (385,029)
------------
NET ASSETS APPLICABLE TO 5,985,582
SHARES OUTSTANDING; EQUIVALENT
TO $12.24 PER SHARE - 100.00% $ 73,267,019
------------
COMPONENTS OF NET ASSETS AT MAY 31, 2004(A):
Common stock, $0.01 par value,
500,000,000 shares authorized to the Fund $74,022,219
Treasury stock, 665,065 shares at cost (8,599,291)
Accumulated net realized loss on investments (3,919,665)
Net unrealized appreciation of investments 11,763,756
-----------
Total net assets $73,267,019
-----------
*Fully or partially on loan.
**Includes $3,607,479 of securities loaned.
***Principal amount is stated in the currency in which each bond is denominated.
AUD - Australian Dollar
EUR - European Monetary Unit
GBP - British Pound Sterling
JPY - Japanese Yen
PLZ - Polish Zloty
SEK - Swedish Krona
USD - U.S. Dollar
+ Security exempt from registration under Rule 144A of the Securities Act of
1933. See Note 10 in "Notes to Financial Statements."
++ Non-income producing security for the period ended May 31, 2004.
+++ See Note 8 in "Notes to Financial Statements."
[check mark] Non-income producing security. Security is currently in default.
# Step coupon bond.
[Solid Box] U.S. Treasury bills are traded on a discount basis; the interest
rate shown is the effective yield at the time of purchase by the Fund.
^ Variable Rate Notes - the interest rate shown is the rate as of May 31,
2004.
(a) See Note 4 in "Notes to Financial Statements."
SUMMARY OF ABBREVIATIONS:
ADR - American Depositary Receipt
PIK - Pay-in-kind
See accompanying notes
6
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF OPERATIONS Six Months Ended May 31, 2004 (Unaudited)
INVESTMENT INCOME:
Dividends $ 1,030,271
Interest 986,461
Securities lending income 6,715
Foreign tax withheld (52,021) $ 1,971,426
----------- -----------
EXPENSES:
Management fees 347,994
Accounting and administration expenses 50,000
Legal and professional fees 31,820
Reports to shareholders 23,468
NYSE fees 13,240
Custodian fees 12,183
Transfer agent fees 11,274
Taxes (other than taxes on income) 7,200
Directors' fees 4,193
Other 4,308
-----------
Total operating expenses (before interest expense) 505,680
Interest expense 190,873
-----------
Total operating expenses (after interest expense) 696,553
Less expenses paid indirectly (603)
-----------
Total expenses 695,950
-----------
NET INVESTMENT INCOME 1,275,476
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain on:
Investments 1,927,831
Foreign currencies 453,809
-----------
Net realized gain 2,381,640
Net change in unrealized appreciation/depreciation of investments and foreign currencies 791,093
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCIES 3,172,733
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 4,448,209
===========
See accompanying notes
7
STATEMENTS DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF CHANGES IN NET ASSETS
Six Months Year
Ended Ended
5/31/04 11/30/03
(Unaudited)
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 1,275,476 $ 3,318,501
Net realized gain on investments and foreign currencies 2,381,640 1,457,350
Net change in unrealized appreciation/depreciation of investments and foreign currencies 791,093 13,881,480
----------- -----------
Net increase in net assets resulting from operations 4,448,209 18,657,331
----------- -----------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM(1):
Net investment income (1,717,448) (5,492,967)
Return of capital (1,156,651) (994,113)
----------- -----------
(2,874,099) (6,487,080)
----------- -----------
NET INCREASE IN NET ASSETS 1,574,110 12,170,251
NET ASSETS:
Beginning of period 71,692,909 59,522,658
----------- -----------
End of period (including undistributed net investment income
for financial reporting purposes of $--and $31,885, respectively) $73,267,019 $71,692,909
=========== ===========
(1) See Note 4 in "Notes to Financial Statements."
See accompanying notes
8
STATEMENT DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
OF CASH FLOWS Six Months Ended May 31, 2004 (Unaudited)
NET CASH (INCLUDING FOREIGN CURRENCY) PROVIDED BY OPERATING ACTIVITIES:
Net increase in net assets resulting from operations $4,448,209
-----------
Adjustments to reconcile net increase in net assets from operations to cash
provided by operating activities:
Amortization of premium and discount on investments (28,612)
Net proceeds from investment transactions (2,419,072)
Net realized gain on investment transactions (1,927,831)
Net realized gain on foreign currencies (453,809)
Net change in unrealized appreciation/depreciation of investments and foreign currencies (791,093)
Increase in receivable for investments sold (188,839)
Decrease in interest and dividends receivable 51,666
Increase in payable for investments purchased 353,966
Decrease in interest payable (5,744)
Decrease in distribution payable (478,282)
Decrease in accrued expenses and other liabilities (6,300)
-----------
Total adjustments (5,893,950)
-----------
Net cash provided by operating activities (1,445,741)
-----------
CASH FLOWS USED FOR FINANCING ACTIVITIES:
Increase in principal on line of credit 4,000,000
Cash dividends and distributions paid (2,874,099)
-----------
Net cash used for financing activities 1,125,901
-----------
Effect of exchange rates on cash (142,781)
-----------
Net decrease in cash (462,621)
Cash (overdraft) at beginning of period (25,250)
-----------
Cash (overdraft) at end of period $ (487,871)
===========
Cash paid for interest $ 196,812
===========
See accompanying notes
9
FINANCIAL
HIGHLIGHTS
Selected data for each share of the Fund outstanding
throughout each period were as follows:
- ----------------------------------------------------------------------------------------------------------------------------
Delaware Investments Global Dividend and Income Fund, Inc.
- ----------------------------------------------------------------------------------------------------------------------------
Six Months
Ended Year Ended
5/31/04(1) 11/30/03 11/30/02(4) 11/30/01 11/30/00 11/30/99
(Unaudited)
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.980 $ 9.940 $ 11.170 $ 11.770 $ 13.920 $ 15.700
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income(5) 0.213 0.554 0.499 0.620 0.700 0.930
Net realized and unrealized gain (loss) on
investments and foreign currencies 0.527 2.570 (0.260) 0.280 (1.350) (1.070)
-------- -------- -------- -------- ------ --------
Total from investment operations 0.740 3.124 0.239 0.900 (0.650) (0.140)
-------- -------- -------- -------- ------ --------
LESS DIVIDENDS AND DISTRIBUTIONS FROM(6):
Net investment income (0.287) (0.918) (0.365) (0.195) (0.530) (0.860)
Net realized gain on investments -- -- -- (0.084) (0.470) (0.780)
Return of capital (0.193) (0.166) (1.104) (1.221) (0.500) --
-------- -------- -------- -------- -------- --------
Total dividends and distributions (0.480) (1.084) (1.469) (1.500) (1.500) (1.640)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD 12.240 $ 11.980 $4 9.940 $ 11.170 $ 11.770 $ 13.920
======== ======== ======== ======== ======== ========
MARKET VALUE, END OF PERIOD $ 11.240 $ 11.900 $ 10.400 $ 12.400 $ 10.380 $ 11.750
======== ======== ======== ======== ======== ========
TOTAL RETURN BASED ON:(2)
Market value (1.72%) 25.92% (5.49%) 34.52% 0.29% (17.00%)
Net asset value 6.31% 32.63% 0.28% 6.91% (4.04%) (0.57%)
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (000 omitted) $ 73,267 $ 71,693 $ 59,523 $ 66,870 $ 70,420 $ 92,601
Ratio of expenses to average net assets 1.85% 2.04% 2.26% 3.31% 3.45% 2.69%
Ratio of expenses to adjusted
average net assets (before interest expense)(3) 1.02% 1.08% 1.06% 1.10% 1.04% 1.00%
Ratio of interest expense to
adjusted average net assets(3) 0.39% 0.46% 0.64% 1.35% 1.62% 1.15%
Ratio of net investment income to
average net assets 3.39% 5.14% 4.69% 5.18% 5.34% 6.14%
Ratio of net investment income to
adjusted average net assets(3) 2.58% 3.88% 3.53% 3.84% 4.11% 4.92%
Portfolio turnover 71% 99% 69% 47% 43% 58%
LEVERAGE ANALYSIS:
Debt outstanding at end of
period (000 omitted) $ 25,000 $ 21,000 $ 21,000 $ 25,000 $ 25,000 $ 25,000
Average daily balance of debt
outstanding (000 omitted) $ 23,842 $ 21,000 $ 21,603 $ 25,000 $ 25,000 $ 25,000
Average daily balance of shares
outstanding (000 omitted) 5,986 5,986 5,986 5,986 6,389 6,651
Average debt per share $ 3.98 $ 3.51 $ 3.61 $ 4.18 $ 3.91 $ 3.76
Asset coverage per $1,000 of debt
outstanding at end of period $3,931 $ 4,414 $ 3,834 $ 3,675 $ 3,817 $ 4,704
(1) Ratios and portfolio turnover have been annualized and total return has not
been annualized.
(2) Total investment return is calculated assuming a purchase of common stock on
the opening of the first day and a sale on the closing of the last day of
each period reported. Dividends and distributions, if any, are assumed for
the purpose of this calculation, to be reinvested at prices obtained under
the Fund's dividend reinvestment plan. Generally, total investment return
based on net asset value will be higher than total investment return based
on market value in periods where there is an increase in the discount or
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total investment return
based on net asset value will be lower than total investment return based on
market value in periods where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such periods.
(3) Adjusted average net assets excludes debt outstanding.
(4) As required, effective December 1, 2001, the Fund adopted the provisions of
the AICPA Audit and Accounting Guide for Investment Companies that requires
amortization of all premium and discounts on debt securities. The effect of
this change for the year ended November 30, 2002 was a decrease in net
investment income per share of $0.024, an increase in net realized and
unrealized gain (loss) per share of $0.024, a decrease in the ratio of net
investment income to average net assets of 0.23%, and a decrease in the
ratio of net investment income to adjusted net assets of 0.17%. Per share
data and ratios for the periods prior to December 1, 2001 have not been
restated to reflect this change in accounting.
(5) The average shares outstanding method has been applied for per share
information.
(6) See Note 4 in "Notes to Financial Statements."
See accompanying notes
10
DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
May 31, 2004 (Unaudited)
NOTES
TO FINANCIAL STATEMENTS
Delaware Investments Global Dividend and Income Fund, Inc. (the "Fund") is
organized as a Maryland corporation and is a diversified closed-end management
investment company under the Investment Company Act of 1940, as amended. The
Fund's shares trade on the New York Stock Exchange under the symbol DGF.
The investment objective of the Fund is to seek high current income. Capital
appreciation is a secondary objective.
1. SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies are in accordance with U.S. generally accepted
accounting principles and are consistently followed by the Fund.
Security Valuation - Equity securities, except those traded on the Nasdaq Stock
Market, Inc. (NASDAQ), are valued at the last quoted sales price as of time of
the regular close of the New York Stock Exchange (NYSE) on the valuation date.
Securities traded on the NASDAQ are valued in accordance with the NASDAQ
Official Closing Price, which may not be the last sales price. If on a
particular day an equity security does not trade, then the mean between the bid
and asked prices will be used. Securities listed on a foreign exchange are
normally valued at the last quoted sales price before the Fund is valued. If on
a particular day a security does not trade, then the mean between the bid and
the asked prices will normally be used. U.S. government and agency securities
are valued at the mean between the bid and asked prices. Long-term debt
securities are valued by an independent pricing service and such prices are
believed to reflect the fair value of such securities. Short-term debt
securities having less than 60 days to maturity are valued at amortized cost,
which approximates market value. Forward foreign currency exchange contracts are
valued at the mean between the bid and asked prices of the contracts and are
marked-to-market daily. Interpolated values are derived when the settlement date
of the contract is an interim date for which quotations are not available. Other
securities and assets for which market quotations are not readily available are
valued at fair value as determined in good faith under the direction of the
Fund's Board of Directors. In determining whether market quotations are readily
available or fair valuation will be used, various factors will be taken into
consideration, such as market closures, or with respect to foreign securities,
aftermarket trading or significant events after local market trading (e.g.,
government actions or pronouncements, trading volume or volatility on markets,
exchanges among dealers, or news events).
Federal Income Taxes - The Fund intends to continue to qualify for federal
income tax purposes as a regulated investment company and make the requisite
distributions to shareholders. Accordingly, no provision for federal income
taxes has been made in the financial statements.
Distributions - The Fund has a managed distribution policy. Under the policy,
the Fund declares and pays monthly distributions and is managed with a goal of
generating as much of the distribution as possible from ordinary income (net
investment income and short-term capital gains). The balance of the distribution
then comes from long-term capital gains and if necessary, a return of capital.
The current annualized rate is $0.96 per share. The Fund continues to evaluate
its monthly distribution in light of ongoing economic and market conditions and
may change the amount of the monthly distributions in the future.
Foreign Currency Transactions - Transactions denominated in foreign currencies
are recorded at the prevailing exchange rates on the valuation date. The values
of all assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rate of such currencies against the U.S.
dollar daily. Transaction gains or losses resulting from changes in exchange
rates during the reporting period or upon settlement of the foreign currency
transaction are reported in operations for the current period. The Fund isolates
that portion of realized gains and losses on investments in debt securities,
which are due to changes in foreign exchange rates from that which are due to
changes in market prices of debt securities. For foreign equity securities,
these changes are included in realized gains (losses) on investments. The Fund
reports certain foreign currency related transactions as components of realized
gains (losses) for financial reporting purposes, where such components are
treated as ordinary income (loss) for federal income tax purposes.
Use of Estimates - 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 at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.
Other - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Management fees and other expenses are paid monthly. Security transactions are
recorded on the date the securities are purchased or sold (trade date). Costs
used in calculating realized gains and losses on the sale of investment
securities are those of the specific securities sold. Dividend income is
recorded on the ex-dividend date and interest income is recorded on the accrual
basis. Discounts and premiums are amortized to interest income over the lives of
the respective securities. Foreign dividends are also recorded on the
ex-dividend date or as soon after the ex-dividend date that the Fund is aware of
such dividends, net of all non-rebatable tax withholdings. Withholding taxes on
foreign dividends have been recorded in accordance with the Fund's understanding
of the applicable country's tax rules and rates. Distributions received from
investments in Real Estate Investment Trusts are recorded as dividend income on
ex-dividend date, subject to reclassification upon notice of the character of
such distributions by the issuer.
Through March 31, 2004, certain expenses of the Fund were paid through
commission arrangements with brokers. The amount of these expenses was
approximately $603 for the six months ended May 31, 2004. The expense paid under
the above arrangement is included in "other" on the Statement of Operations with
the corresponding expense offset shown as "expenses paid indirectly."
2. INVESTMENT MANAGEMENT, ADMINISTRATION AGREEMENTS AND OTHER TRANSACTIONS WITH
AFFILIATES
In accordance with the terms of its investment management agreement, the Fund
pays Delaware Management Company (DMC), a series of Delaware Management Business
Trust and the investment manager, an annual fee of 0.70% which is calculated
daily based on the adjusted average weekly net assets. Adjusted average weekly
net assets does not include the line of credit liability.
DMC has entered into a sub-advisory agreement with Delaware International
Advisers Ltd. (DIAL), an affiliate of DMC, related to the foreign securities
portion of the Fund. For the services provided, DMC pays DIAL a monthly fee
which is equal to 40% of the of the fee paid to DMC under the terms of the
investment management agreement. The Fund does not pay any fees directly to
DIAL.
DIAL is being acquired by a venture comprised of certain members of DIAL's
management and a private equity firm, Hellman & Friedman, LLC. This transaction
is expected to close late in the third quarter or early in the fourth quarter of
this year (the "Closing"). Under applicable law, DIAL's Sub-Advisory Agreement
for the Fund will automatically terminate as of the Closing. DMC has informed
the Board of Directors of the Fund that it will not seek to continue the
Sub-Advisory Agreement with DIAL after the Closing and if deemed appropriate,
may terminate the Sub-Advisory Agreement prior to the Closing. The Board was
informed that upon termination of the Sub-Advisory Agreement, DMC would assume
responsibility for the day-to-day management of the assets formerly managed by
DIAL.
The Fund has engaged Delaware Service Company, Inc. (DSC), an affiliate of DMC
and DIAL, to provide accounting and administration services. The Fund pays DSC a
monthly fee computed at the annual rate of 0.05% of the Fund's adjusted average
weekly net assets, subject to an annual minimum of $100,000.
11
NOTES DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
TO FINANCIAL STATEMENTS (CONTINUED)
2. INVESTMENT MANAGEMENT, ADMINISTRATION AGREEMENTS AND OTHER TRANSACTIONS WITH
AFFILIATES (CONTINUED)
At May 31, 2004, the Fund had liabilities payable to affiliates as follows:
Investment management fee payable to DMC $56,198
Accounting and administration fees
and other expenses payable to DSC 37,339
Other expense payable to DMC and affiliates* 2,903
*DMC, as part of its administration services, pays operating expenses on behalf
of the Fund and is reimbursed on a periodic basis. Such expenses include items
such as printing of shareholder reports, fees for audit, legal and tax services,
stock exchange fees, custodian fees and directors fees.
As provided in the investment management agreement, the Fund bears the cost of
certain legal services expenses, including in house legal services provided to
the Fund by DMC employees. For the six months ended May 31, 2004, the Fund had
costs of $2,327.
Certain officers of DMC, DIAL and DSC are officers and/or directors the Fund.
These officers and directors are paid no compensation by the Fund.
3. INVESTMENTS
For the six months ended May 31, 2004, the Fund made purchases of $33,976,417
and sales of $31,963,696 of investment securities other than U.S. government
securities and short-term investments.
At May 31, 2004, the cost of investments for federal income taxes purposes has
been estimated since the final tax characteristics cannot be determined until
fiscal year end. At May 31, 2004, the cost of investments was $86,869,734. At
May 31, 2004, the net unrealized appreciation was $11,782,314 of which
$14,180,405 related to unrealized appreciation of investments and $2,398,091
related to unrealized depreciation of investments.
4. DIVIDEND AND DISTRIBUTION INFORMATION
Income and long-term capital gain distributions are determined in accordance
with federal income tax regulations, which may differ from U.S. generally
accepted accounting principles. The tax character of dividends and distributions
paid during the six months ended May 31, 2004 and the year ended November 30,
2003, was as follows:
Six Months Year
Ended Ended
5/31/04* 11/30/03
---------- --------
Ordinary income $1,717,448 $5,492,967
Return of capital 1,156,651 994,113
---------- ----------
Total $2,874,099 $6,487,080
========== ==========
*Tax information for the six months ended May 31, 2004 is an
estimate and the tax character of dividends and distributions may be
redesignated at fiscal year end.
The components of net assets for federal income tax purposes are estimated since
final tax characteristics cannot be determined until fiscal year end. As of May
31, 2004, the estimated components of net assets on a tax basis were as follows:
Shares of beneficial interest $65,422,928
Capital loss carryforwards (3,942,969)
Unrealized appreciation of investments
and foreign currencies 11,787,060
-----------
Net assets $73,267,019
===========
The differences between book basis and tax basis components of net assets are
primarily attributable to tax deferral of losses on wash sales and tax treatment
of market discount and premium on debt instruments.
For financial reporting purposes, capital accounts and distributions to
shareholders are adjusted to reflect the tax character of book/tax differences.
For the six months ended May 31, 2004, the Fund recorded an estimate of these
differences since the final tax characteristics cannot be determined until
fiscal year end. Reclassifications are primarily due to tax treatment of gain
(loss) or foreign currency transactions and market discount and premium on
certain debt instruments. Results of operations and net assets were not affected
by these reclassifications.
Undistributed net investment income $ 1,232,775
Accumulated realized gain (loss) (76,124)
-----------
Paid in capital $ 1,156,651
===========
At November 30, 2003, for federal income tax purposes, the Fund had capital loss
carryforwards of $5,802,012 which may be carried forward and applied against
future capital gains. Such capital loss carryforwards expire as follows:
$1,093,240 expires in 2009, $3,986,959 expires in 2010 and $721,813 expires in
2011.
For the six months ended May 31, 2004, the Fund had capital gains of $1,859,043,
which may be offset by the capital loss carryforwards.
5. CAPITAL STOCK
The Fund did not have any transactions in common shares during the six months
ended May 31, 2004.
Shares issuable under the Fund's dividend reinvestment plan are purchased by the
Fund's transfer agent, Mellon Investor Services, LLC, in the open market.
6. LINE OF CREDIT
The Fund has entered into a Line of Credit Agreement with J.P. Morgan Chase for
$25,000,000 that expires on January 20, 2005. At May 31, 2004, the par value of
loans outstanding was $25,000,000 at a variable interest rate of 1.65%. During
the six months ended May 31, 2004, the average daily balance of loans
outstanding was $23,841,530 at a weighted average interest rate of approximately
1.64%. The maximum amount of loans outstanding at any time during the six months
ended May 31, 2004 was $25,000,000. Interest on borrowings is based on market
rates in effect at the time of borrowing. The commitment fee is computed at a
rate of 0.15% per annum on the unused balance. For the six months ended May 31,
2004, the Fund was charged a commitment fee of $1,533 which is included in
"custodian fees" on the Statement of Operations. The loan is collateralized by
the Fund's portfolio.
7. FOREIGN EXCHANGE CONTRACTS
The Fund may enter into forward foreign currency exchange contracts as a way of
managing foreign exchange rate risk. The Fund may enter into these contracts to
fix the U.S. dollar value of a security that it has agreed to buy or sell for
the period between the date the trade was entered into and the date the security
is delivered and paid for. The Fund may also use these contracts to hedge the
U.S. dollar value of securities it already owns that are denominated in foreign
currencies.
The change in market value is recorded as an unrealized gain or loss. When the
contract is closed, a realized gain or loss is recorded equal to the difference
between the value of the contract at the time it was opened and the value at the
time it was closed.
The use of forward foreign currency exchange contracts does not eliminate
fluctuations in the underlying prices of the securities, but does establish a
rate of exchange that can be achieved in the future. Although forward foreign
currency exchange contracts limit the risk of loss due to a decline in the value
of the hedged currency, they also limit any potential gain that might result
should the value of the currency increase. In addition, the Fund could be
exposed to risks if the counterparties to the contracts are unable to meet the
terms of their contracts.
12
NOTES DELAWARE INVESTMENTS GLOBAL DIVIDEND AND INCOME FUND, INC.
TO FINANCIAL STATEMENTS (CONTINUED)
7. FOREIGN EXCHANGE CONTRACTS (CONTINUED)
The following foreign currency exchange contracts were outstanding at May 31,
2004:
Settlement Unrealized
Contracts to Deliver In Exchange for Date Depreciation
- -------------------- --------------- -------------- ------------
555,000 $987,345 7/30/04 ($24,331)
British Pounds
1,520,000 $2,675,200 7/30/04 ($95,515)
British Pounds
---------
($119,846)
=========
8. SECURITIES LENDING
The Fund, along with other funds in the Delaware Investments Family of Funds,
may lend its securities pursuant to a security lending agreement (Lending
Agreement) with J.P. Morgan Chase. Initial security loans made pursuant to the
Lending Agreement are required to be secured by U.S. government obligations
and/or cash collateral not less than 102% of the market value of the securities
issued in the United States and 105% of the market value of securities issued
outside the United States. With respect to each loan, if the aggregate market
value of the collateral held on any business day is less than the aggregate
market value of the securities which are the subject of such loan, the borrower
will be notified to provide additional collateral not less than the applicable
collateral requirements. Cash collateral received is invested in fixed-income
securities, with a weighted average maturity not to exceed 90 days, rated in one
of the top two tiers by Standard & Poor's Ratings Group or Moody's Investors
Service, Inc. or repurchase agreements collateralized by such securities.
However, in the event of default or bankruptcy by the lending agent, realization
and/or retention of the collateral may be subject to legal proceedings. In the
event the borrower fails to return loaned securities and the collateral received
is insufficient to cover the value of the loaned securities and provided such
collateral shortfall is not the result of investment losses, the lending agent
has agreed to pay the amount of the shortfall to the Fund, or at the discretion
of the lending agent, replace the loaned securities. The Fund continues to
record dividends on the securities loaned and is subject to change in fair value
of the securities loaned that may occur during the term of the loan. The Fund
has the right under the Lending Agreement to recover the securities from the
borrower on demand. The security lending agent and the borrower retain a portion
of the earnings from collateral investments. The Fund records security lending
income net of such allocation.
At May 31, 2004, the market value of securities on loan was $3,607,479, for
which cash collateral was received and invested in accordance with the Lending
Agreement. Such investments are presented on the Statement of Net Assets under
the caption "Securities Lending Collateral."
9. GEOGRAPHIC DISCLOSURE
As of May 31, 2004, the Fund's geographic diversification (based on the issuer
of each security's domicile) of its investments portfolio before security
lending collateral was as follows:
COUNTRY MARKET VALUE
- --------------------------------------------------------------
United States $58,968,581 59.77%
- --------------------------------------------------------------
Britain 7,633,505 7.74%
- --------------------------------------------------------------
Japan 6,287,197 6.37%
- --------------------------------------------------------------
Australia 4,908,070 4.98%
- --------------------------------------------------------------
France 4,822,070 4.89%
- --------------------------------------------------------------
Germany 3,145,223 3.19%
- --------------------------------------------------------------
Sweden 2,397,038 2.43%
- --------------------------------------------------------------
Belgium 1,930,917 1.96%
- --------------------------------------------------------------
Poland 1,779,873 1.80%
- --------------------------------------------------------------
Spain 1,677,179 1.70%
- --------------------------------------------------------------
COUNTRY MARKET VALUE
- --------------------------------------------------------------
Netherlands $ 1,306,824 1.32%
- --------------------------------------------------------------
Hong Kong 894,161 0.91%
- --------------------------------------------------------------
New Zealand 660,295 0.67%
- --------------------------------------------------------------
Austria 559,429 0.57%
- --------------------------------------------------------------
Italy 440,511 0.45%
- --------------------------------------------------------------
South Africa 412,606 0.42%
- --------------------------------------------------------------
Greece 289,767 0.29%
- --------------------------------------------------------------
Singapore 289,284 0.29%
- --------------------------------------------------------------
Finland 249,518 0.25%
- --------------------------------------------------------------
TOTAL $98,652,048 100.00%
Like any investment in securities, the value of the Fund may be subject to risk
or loss from market, currency, economic and political factors, which occur in
the countries where the Fund is invested.
10. CREDIT AND MARKET RISKS
Some countries in which the Fund may invest require governmental approval for
the repatriation of investment income, capital or the proceeds of sales of
securities by foreign investors. In addition, if there is deterioration in a
country's balance of payments or for other reasons, a country may impose
temporary restrictions on foreign capital remittances abroad.
The securities exchanges of certain foreign markets are substantially smaller,
less liquid and more volatile than the major securities markets in the United
States. Consequently, acquisition and disposition of securities by the Fund may
be inhibited. In addition, a significant portion of the aggregate market value
of equity securities listed on the major securities exchanges in emerging
markets are held by a smaller number of investors. This may limit the number of
shares available for acquisition or disposition by the Fund.
The Fund invests in high-yield fixed income securities, which carry ratings of
BB or lower by Standard & Poor's Ratings Group and/or Ba or lower by Moody's
Investors Service, Inc. Investments in these higher yielding securities are
generally accompanied by a greater degree of credit risk than higher rated
securities. Additionally, lower rated securities may be more susceptible to
adverse economic and competitive industry conditions than investment grade
securities.
The Fund may invest up to 10% of its total assets in illiquid securities which
may include securities with contractual restrictions on resale, securities
exempt from registration under Rule 144A of the Securities Act of 1933, as
amended, and other securities which may not be readily marketable. The relative
illiquidity of these securities may impair the Fund from disposing of them in a
timely manner and at a fair price when it is necessary or desirable to do so.
The Fund invests in real estate investment trusts (REITs) and is subject to some
the risks associated with that industry. If the Fund holds real estate directly
as a result of defaults or receives rental income directly from real estate
holdings, its tax status as a regulated investment company may be jeopardized.
There were no direct holdings during the six months ended May 31, 2004. The
Fund's REIT holdings are also affected by interest rate changes, particularly if
the REITs it holds use floating rate debt to finance their ongoing operations.
11. CONTRACTUAL OBLIGATIONS
The Fund enters into contracts in the normal course of business that contain a
variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to these contracts. Management has reviewed the Fund's existing
contracts and expects the risk of loss to be remote.
13
Delaware
Investments(SM) [Graphic Omitted]
- --------------------------------------
A member of Lincoln Financial Group(R)
This semiannual report is for the information of Delaware Investments Global
Dividend and Income Fund, Inc. shareholders. The figures in this report
represent past results which are not a guarantee of future results. The return
and principal value of an investment in the Fund will fluctuate so that shares,
when sold, may be worth more or less than their original cost.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may, from time to time, purchase shares of its
Common Stock on the open market at market prices.
BOARD OF DIRECTORS AFFILIATED OFFICERS CONTACT INFORMATION
JUDE T. DRISCOLL JOSEPH H. HASTINGS INVESTMENT MANAGER
Chairman Executive Vice President and Delaware Management Company
Delaware Investments Family of Funds Chief Financial Officer Philadelphia, PA
Philadelphia, PA Delaware Investments Family of Funds
Philadelphia, PA INVESTMENT SUB-ADVISER
WALTER P. BABICH Delaware International Advisers Ltd.
Board Chairman RICHELLE S. MAESTRO London, England
Citadel Construction Corporation Executive Vice President,
King of Prussia, PA Chief Legal Officer and Secretary PRINCIPAL OFFICE OF THE FUND
Delaware Investments Family of Funds 2005 Market Street
JOHN H. DURHAM Philadelphia, PA Philadelphia, PA 19103
Private Investor Gwynedd Valley, PA
JOHN A. FRY MICHAEL P. BISHOF INDEPENDENT AUDITORS
President Franklin & Marshall College Senior Vice President and Treasurer Ernst & Young LLP
Lancaster, PA Delaware Investments 2001 Market Street
Family of Funds Philadelphia, PA 19103
ANTHONY D. KNERR Philadelphia, PA
Managing Director REGISTRANT AND STOCK TRANSFER AGENT
Anthony Knerr & Associates Mellon Investor Services, LLC
New York, NY Overpeck Centre
85 Challenger Road
ANN R. LEVEN+ Ridgefield, NJ 07660
Former Treasurer/Chief Fiscal Officer 800 851-9677
National Gallery of Art
Washington, DC FOR SECURITIES DEALERS AND FINANCIAL
INSTITUTIONS REPRESENTATIVES ONLY
THOMAS F. MADISON+ 800 362-7500
President and Chief Executive Officer
MLM Partners, Inc. WEB SITE
Minneapolis, MN www.delawareinvestments.com
JANET L. YEOMANS+
Vice President/Mergers & Acquisitions
3M Corporation
St. Paul, MN
- --------------------------------------------------------------------------------
A description of the policies and procedures that the Fund uses to determine how
to vote proxies (if any) relating to portfolio securities is available without
charge (i) upon request, by calling 800-523-1918; (ii) on the Fund's website at
http://www.delawareinvestments.com; and (iii) on the Commission's website at
http://www.sec.gov.; and beginning no later than August 31, 2004, information
(if any) regarding how the Fund voted proxies relating to portfolio securities
during the most recent 12-month period ended June 30 is available without charge
(i) through the Fund's website at http://www.delawareinvestments.com; and (ii)
on the Commission's website at http://www.sec.gov.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
YOUR REINVESTMENT OPTIONS
Delaware Investments Global Dividend and Income Fund, Inc. offers an automatic
dividend reinvestment program. If you would like to reinvest dividends, and
shares are registered in your name, contact Mellon Investor Services, LLC at 800
851-9677. You will be asked to put your request in writing. If you have shares
registered in "street" name, contact the broker/dealer holding the shares or
your financial advisor.
- --------------------------------------------------------------------------------
+ Audit Committee Member
(8783) Printed in the USA
SA-DGF [5/04] IVES 7/04 J9724
Item 2. Code of Ethics
Not applicable.
Item 3. Audit Committee Financial Expert
Not applicable.
Item 4. Principal Accountant Fees and Services
Not applicable.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Not applicable.
Item 8. Purchases of Equity Securities by Closed-End Management Investment
Companies and Affiliated Purchasers
Required only for periods ending on or after June 15, 2004.
Item 9. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 10. Controls and Procedures
The registrant's principal executive officer and principal financial
officer have evaluated the registrant's disclosure controls and procedures
within 90 days of the filing of this report and have concluded that they are
effective in providing reasonable assurance that the information required to be
disclosed by the registrant in its reports or statements filed under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the rules and forms of the Securities and
Exchange Commission.
There were no significant changes in the registrant's internal control
over financial reporting that occurred during the registrant's last fiscal
half-year that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
Item 11. Exhibits
(a) (1) Code of Ethics
Not applicable.
(2) Certifications of Principal Executive Officer and Principal Financial
Officer pursuant to Rule 30a-2 under the Investment Company Act of 1940 are
attached hereto as Exhibit 99.CERT.
(3) Written solicitations to purchase securities pursuant to Rule 23c-1
under the Securities Exchange Act of 1934.
Not applicable.
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are
furnished herewith as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf, by the undersigned, thereunto duly authorized.
NAME OF REGISTRANT: Delaware Investments Global Dividend and Income Fund, Inc.
JUDE T. DRISCOLL
- -------------------------
By: Jude T. Driscoll
Title: Chairman
Date: 8/5/04
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.
JUDE T. DRISCOLL
By: Jude T. Driscoll
- ----------------------------
Title: Chairman
Date: 8/5/04
JOSEPH H. HASTINGS
- ----------------------------
By: Joseph H. Hastings
Title: Chief Financial Officer
Date: 8/5/04