-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KDGLUUh7bw0qB2uCd04KUVxGkgbVHciRAsa5Ako7rspmUujODfydbdEHSj0WpG2t va/TGO9RNYQwCNfOl+IbGw== 0000935069-03-001617.txt : 20031205 0000935069-03-001617.hdr.sgml : 20031205 20031205134504 ACCESSION NUMBER: 0000935069-03-001617 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20030930 FILED AS OF DATE: 20031205 EFFECTIVENESS DATE: 20031205 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PHOENIX SENECA FUNDS CENTRAL INDEX KEY: 0001005020 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-07455 FILM NUMBER: 031039874 BUSINESS ADDRESS: STREET 1: 909 MONTGOMERY STREET CITY: SAN FRANCISCO STATE: CA ZIP: 94133 BUSINESS PHONE: 415 677-1570 MAIL ADDRESS: STREET 1: 56 PROSPECT STREET STREET 2: P.O. BOX 150480 CITY: HARTFORD STATE: CT ZIP: 06115-0480 FORMER COMPANY: FORMER CONFORMED NAME: SENECA FUNDS DATE OF NAME CHANGE: 19951218 N-CSR 1 g8383seneca_sec.txt PHOENIX SENECA 2003 ANNUAL REPORT 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 811-07455 ----------- Phoenix-Seneca Funds ---------------------------------------- (Exact name of registrant as specified in charter) 56 Prospect Street Hartford, CT 06115 ---------------------------------------- (Address of principal executive offices) (Zip code) PFPC Inc. 301 Bellevue Parkway Wilmington, DE 19809 ---------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: 302-791-3197 --------------- Date of fiscal year end: September 30, 2003 ------------------ Date of reporting period: September 30, 2003 ------------------ Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ITEM 1. REPORTS TO STOCKHOLDERS. ANNUAL REPORT SEPTEMBER 30, 2003 (LOGO) o SENECA o [GRAPHIC OMITTED] Phoenix-Seneca Bond Fund Phoenix-Seneca Mid-Cap "EDGE"SM Fund Phoenix-Seneca Real Estate Securities Fund [GRAPHIC OMITTED] DO YOU WANT TO STOP RECEIVING FUND DOCUMENTS BY MAIL? GO TO PHOENIXINVESTMENTS.COM, LOG IN AND SIGN UP FOR E-DELIVERY (LOGO) PHOENIX INVESTMENT PARTNERS, LTD. COMMITTED TO INVESTOR SUCCESS(SM) [GRAPHIC OMITTED] MESSAGE FROM THE CHAIRMAN DEAR SHAREHOLDER: [GRAPHIC OMITTED] I hope that you'll take time to review the activities and performance information included in this Phoenix Seneca Funds annual report. With this writing, we are continuing to witness new signs of life in the equity markets, and I am encouraged that our overall economy may be beginning a more rewarding period. Now is an opportune time for you to review your investments with your financial advisor to be sure your portfolio is best positioned to achieve long-term success. Keep in mind that finding the best balance of performance and protection requires discipline and diversification 1. Your investment in Phoenix-Seneca Bond Fund, Phoenix-Seneca Mid-Cap "EDGE" Fund, and Phoenix-Seneca Real Estate Securities Fund may help you in this effort. To learn more about your investments and investing, visit PhoenixInvestments.com. Sincerely, /s/ PHILIP R. McLOUGHLIN Philip R. McLoughlin Chairman, Phoenix Funds SEPTEMBER 30, 2003 1 DIVERSIFICATION DOES NOT GUARANTEE AGAINST A LOSS, AND THERE IS NO GUARANTEE THAT A DIVERSIFIED PORTFOLIO WILL OUTPERFORM A NON-DIVERSIFIED PORTFOLIO. - -------------------------------------------------------------------------------- Mutual funds are not insured by the FDIC; are not deposits or other obligations of a bank and are not guaranteed by a bank; and are subject to investment risks, including possible loss of the principal invested. - -------------------------------------------------------------------------------- 1 TABLE OF CONTENTS Phoenix-Seneca Bond Fund .................................................... 3 Phoenix-Seneca Mid-Cap "EDGE"SM Fund ........................................ 13 Phoenix-Seneca Real Estate Securities Fund .................................. 22 Notes to Financial Statements ............................................... 30 This report is not authorized for distribution to prospective investors in Phoenix-Seneca Funds unless preceded or accompanied by an effective Prospectus which includes information concerning the sales charge, the Trust's record and other pertinent information. 2 PHOENIX-SENECA BOND FUND A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGEMENT TEAM, GAIL SENECA, PH.D. AND ALBERT GUTIERREZ, CFA Q: WHAT IS THE FUND'S INVESTMENT OBJECTIVE? A: The Phoenix-Seneca Bond Fund seeks high total return from both current income and capital appreciation. Q: HOW DID THE FUND PERFORM FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003? A: For the 12 months ended September 30, 2003, Class X shares rose 8.57%, Class A shares gained 8.28%, Class B shares were up 7.43%, and Class C shares were up 7.42%. For the same period, the Lehman Aggregate Bond Index1 rose 5.41%. All performance figures assume reinvestment of distributions and exclude the effect of sales charges. Past performance is not a guarantee of future performance. Q: HOW WOULD YOU CHARACTERIZE THE FIXED INCOME MARKET ENVIRONMENT OVER THE LAST 12 MONTHS? A: The last 4 quarters can best be characterized as three quarters of yields grinding lower and spreads narrowing followed by a final quarter of impressive volatility in all sectors with the exception of credit. Spread product enjoyed a resurgence of demand after a difficult 2002 when war fears, corporate malfeasance and agency asset/liability management concerns all served to push investors into the perceived safety of treasury securities. In the July-September 2003 quarter, however, yields had a wild ride as 10-year treasury rates started the quarter at 3.52%, hit a high of 4.65% before ending the quarter at 3.94%. What started as a modest reaction to a disappointing Federal Reserve rate cut on June 25th escalated into a panicky sell-off as mortgage-backed security holders frantically tried to rebalance portfolios amid rising interest rates. Additionally, the weakening dollar increased fears of foreign investors potentially selling some of their fixed income holdings. Once these concerns subsided, the market regained some normalcy. Q: WHAT FACTORS AFFECTED PERFORMANCE? A: Our strategic focus on asset allocation, reflected in over-weighting investment grade and high-yield corporate credit and mortgages, was a significant factor in our out-performance. Sector and security selection positively contributed to our returns with specific overweight positions in TIPS, Treasury bonds, telecom, media, commercial and residential mortgages being the performance leaders. Q: WHAT IS YOUR CURRENT OUTLOOK? A: Our expertise in fundamental credit analysis should continue to be an advantage with the uneven recovery of the global economy. We will utilize the tools necessary to generate positive performance including asset allocation, sector and security selection, and duration and yield curve management. OCTOBER 2003 THE PRECEDING INFORMATION IS THE OPINION OF FUND MANAGEMENT. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS, AND THERE IS NO GUARANTEE THAT MARKET FORECASTS DISCUSSED WILL BE REALIZED. 1 THE LEHMAN AGGREGATE BOND INDEX MEASURES BROAD BOND MARKET TOTAL-RETURN PERFORMANCE. THE INDEX IS UNMANAGED, DOES NOT REFLECT MANAGEMENT FEES, AND IS NOT AVAILABLE FOR DIRECT INVESTMENT. 3 Phoenix-Seneca Bond Fund - -------------------------------------------------------------------------------- ANNUAL TOTAL RETURNS 1 PERIOD ENDING 9/30/03 - -------------------------------------------------------------------------------- INCEPTION INCEPTION 1 YEAR 5 YEARS TO 9/30/03 DATE ------ ------- ---------- --------- Class X Shares at NAV 2 8.57% 6.78% 7.76% 3/7/96 Class A Shares at NAV 2 8.28 6.30 6.09 7/1/98 Class A Shares at POP 3 3.14 5.27 5.11 7/1/98 Class B Shares at NAV 2 7.43 5.51 5.29 7/1/98 Class B Shares with CDSC 4 3.43 5.51 5.29 7/1/98 Class C Shares at NAV 2 7.42 5.51 5.29 7/1/98 Class C Shares with CDSC 4 7.42 5.51 5.29 7/1/98 Lehman Aggregate Bond Index 7 5.41 6.63 Note 5 Note 5 - -------------------------------------------------------------------------------- GROWTH OF $10,000 PERIODS ENDING 9/30 - -------------------------------------------------------------------------------- 6 This Growth of $10,000 chart assumes an initial investment of $10,000 made on 3/7/96 (inception of the Fund) in Class X shares and reflects no sales charge. Performance assumes dividends and capital gains are reinvested. The performance of other share classes will be greater or less than that shown based on differences in inception dates, fees and sales charges. [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Phoenix-Seneca Bond Fund Class X at NAV 6 Lehman Aggregate Bond Index 7 3/7/96 $10,000.00 $10,000.00 9/30/96 $10,413.21 $10,146.20 9/30/97 $11,585.77 $11,131.54 9/30/98 $12,679.15 $12,412.72 9/30/99 $13,123.98 $12,367.32 9/29/00 $13,934.21 $13,231.56 9/28/01 $15,304.83 $14,945.50 9/30/02 $16,214.47 $16,230.25 9/30/03 $17,604.72 $17,108.88 - -------------------------------------------------------------------------------- SECTOR WEIGHTINGS 9/30/03 - -------------------------------------------------------------------------------- As a percentage of bond holdings [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Corporate 43% Non-Agency Mortgage-Backed 22 Agency Mortgage-Backed 19 U.S. Government 7 Foreign Corporate 7 Foreign Government 1 Convertible 1 1 Total returns are historical and include changes in share price and the reinvestment of both dividends and capital gains distributions. 2 "NAV" (Net Asset Value) total returns do not include the effect of any sales charge. 3 "POP" (Public Offering Price) total returns include the effect of the maximum front-end 4.75% sales charge. 4 CDSC (contingent deferred sales charge) is applied to redemptions of certain classes of shares that do not have a sales charge applied at the time of purchase. CDSC charges for B shares decline from 5% to 0% over a five year period. CDSC charges for C shares are 1% in the first year and 0% thereafter. 5 Index performance is 7.35% for Class X (since 3/7/96) and 7.13% for Class A, Class B and Class C (since 7/1/98). 6 This chart illustrates NAV returns on Class X shares. Returns on Class A, Class B and Class C shares will vary due to differing sales charges, fees and inception dates. 7 The Lehman Aggregate Bond Index is an unmanaged, commonly used measure of bond market total return performance. The index's performance does not reflect management fees and sales charges. All returns represent past performance which is not indicative of future performance. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. 4 Phoenix-Seneca Bond Fund - -------------------------------------------------------------------------------- TEN LARGEST HOLDINGS AT SEPTEMBER 30, 2003 (AS A PERCENTAGE OF TOTAL NET ASSETS) - -------------------------------------------------------------------------------- 1. U.S. Treasury Note 4.25%, 8/15/13 3.9% 2. GNMA TBA 3%, 10/20/33 3.5% 3. GNMA 4%, 10/20/32 2.3% 4. Bear Stearns Adjustable Rate Mortgage Trust 03-7, 7A 4.907%, 10/25/33 2.3% 5. Master Asset Securitization Trust 03-5, 1A1 5.50%, 6/25/33 1.9% 6. Verizon Global Funding Corp. 7.75%, 12/1/30 1.8% 7. Freddie Mac 5.50%, 8/15/21 1.7% 8. U.S. Treasury Bond 6.25%, 5/15/30 1.6% 9. Freddie Mac 5.50%, 9/15/21 1.5% 10. Freddie Mac 5.50%, 1/15/22 1.5% - -------------------------------------------------------------------------------- INVESTMENTS AT SEPTEMBER 30, 2003 MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- U.S. GOVERNMENT SECURITIES--7.1% U.S. TREASURY BONDS--1.6% U.S. Treasury Bond 6.25%, 5/15/30 ........... Aaa $ 991 $ 1,175,923 U.S. TREASURY NOTES--5.5% U.S. Treasury Note 2%, 8/31/05 .............. Aaa 500 505,391 U.S. Treasury Inflationary Note 3.375%, 1/15/07(f) .................................. Aaa 495 631,990 U.S. Treasury Note 4.25%, 8/15/13 ........... Aaa 2,730 2,798,569 ----------- 3,935,950 ----------- - ----------------------------------------------------------------------------- TOTAL U.S. GOVERNMENT SECURITIES (IDENTIFIED COST $5,132,268) 5,111,873 - ----------------------------------------------------------------------------- AGENCY MORTGAGE-BACKED SECURITIES--18.0% Fannie Mae 7.50%, 2/1/27 .................... Aaa 779 834,537 Fannie Mae 3.616%, 7/1/33(c) ................ Aaa 983 1,004,393 Fannie Mae 4.316%, 8/1/33(c) ................ Aaa 404 407,825 Fannie Mae 4.23%, 9/1/33(c) ................. Aaa 170 171,510 Fannie Mae 4.367%, 9/1/33(c) ................ Aaa 180 182,250 Fannie Mae 4.638%, 9/1/33(c) ................ Aaa 425 431,282 Freddie Mac 5.50%, '16-'22(e) ............... Aaa 4,699 4,922,090 Freddie Mac 6%, 2/15/30 ..................... Aaa 44 46,514 Freddie Mac 6.50%, 6/15/31 .................. Aaa 55 58,857 Freddie Mac 4.51%, 7/1/33(c) ................ Aaa 671 682,765 GNMA 4%, 10/20/32 ........................... Aaa 1,682 1,691,276 GNMA TBA 3%, 10/20/33 ...................... Aaa 2,550 2,543,625 - ----------------------------------------------------------------------------- TOTAL AGENCY MORTGAGE-BACKED SECURITIES (IDENTIFIED COST $12,870,934) 12,976,924 - ----------------------------------------------------------------------------- MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- NON-AGENCY MORTGAGE-BACKED SECURITIES--20.8% Banc of America Commercial Mortgage, Inc. 00-1, A1A 7.109%, 11/15/31 ............. Aaa $ 579 $ 650,086 Bank of America-First Union NB Commercial Mortgage 01-3, A1 4.89%, 4/11/37 ..................................... Aaa 560 588,113 Bear Stearns Adjustable Rate Mortgage Trust 03-7, 7A 4.907%, 10/25/33(c) .......... Aaa 1,690 1,683,662 Bear Stearns Alternative A Trust 03-1, 1A 1.50%, 5/25/33(c) ........................... Aaa 288 288,162 Bear Stearns Commercial Mortgage Securities, Inc. 03-PWR2, A3 4.834%, 5/11/39 ..................................... Aaa 505 521,303 CDC Commercial Mortgage Trust 02-FX1, A1 5.252%, 5/15/19 .......................... Aaa 572 607,312 Countrywide Alternative Loan Trust 02-12, A3 5.40%, 11/25/32 .......................... Aaa 701 713,920 Countrywide Alternative Loan Trust 02-6, A5 6.50%, 7/25/32 ........................... AAA(d) 499 506,115 Countrywide Funding Corp. 94-1, A5 6.875%, 3/25/24 ............................. Aaa 734 733,813 CS First Boston Mortgage Securities Corp. 03-23, 5A1 6%, 9/25/33 ...................... Aaa 860 880,425 CS First Boston Mortgage Securities Corp. 03-AR24, 3A1 4.157%, 10/25/33(c) ............ Aaa 845 869,822 GMAC Mortgage Corporation Loan Trust 03-AR1, A6 4.653%, 10/19/33 ................. Aaa 255 253,446 LB - UBS Commercial Mortgage Trust 03-C3 2.599%, 3/15/08 ....................... Aaa 678 674,940 See Notes to Financial Statements 5 Phoenix-Seneca Bond Fund MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- Master Asset Securitization Trust Adjustable Rate Mortgages Trust 03-3, 3A3 4.844%, 9/25/33(c) ................ Aaa $ 960 $ 979,350 Master Asset Securitization Trust Alternative Loans Trust 03-7, 5A1 6.25%, 11/25/33 ............................. Aaa 1,035 1,065,080 Master Asset Securitization Trust 03-5, 1A1 5.50%, 6/25/33 .......................... AAA(d) 1,403 1,404,726 Master Asset Securitization Trust 03-5, 4A4 5.50%, 6/25/33 .............................. AAA(d) 1,028 1,049,542 Morgan Stanley Dean Witter Capital I 02-IQ3, A1 3.48%, 9/15/37 ................... Aaa 668 683,749 Structured Asset Securities Corp. 03-14, 1A5 1.62%, 5/25/33(c) ....................... Aaa 435 435,793 Washington Mutual 01-WM4, A1 6%, 11/20/29 .................................... Aaa 88 88,423 Washington Mutual MSC Mortgage Pass-Through Certificates 01-MS14, 1A4 6.25%, 12/25/31 ............................. Aaa 370 382,286 - ----------------------------------------------------------------------------- TOTAL NON-AGENCY MORTGAGE-BACKED SECURITIES (IDENTIFIED COST $15,064,544) 15,060,068 - ----------------------------------------------------------------------------- CORPORATE BONDS--41.0% AEROSPACE & DEFENSE--2.0% Goodrich Corp. 7.625%, 12/15/12 ............. Baa 158 182,092 Goodrich Corp. 7%, 4/15/38 .................. Baa 210 206,239 Raytheon Co. 6.30%, 3/15/05(e) .............. Baa 595 631,202 Raytheon Co. 8.30%, 3/1/10 .................. Baa 330 403,858 ----------- 1,423,391 ----------- AUTO PARTS & EQUIPMENT--0.3% Delphi Corp. 6.50%, 8/15/13 ................. Baa 175 180,888 AUTOMOBILE MANUFACTURERS--1.8% DaimlerChrysler NA Holding Corp. 7.75%, 6/15/05(e) .................................. A 380 414,086 Ford Motor Co. 7.45%, 7/16/31 ............... Baa 335 308,949 General Motors Corp. 8.375%, 7/15/33 ........ Baa 555 580,307 ----------- 1,303,342 ----------- BROADCASTING & CABLE TV--5.9% AMFM, Inc. 8%, 11/1/08(e) ................... Ba 639 731,655 Comcast Corp. 7.05%, 3/15/33 ................ Baa 445 487,708 Continental Cablevision, Inc. 8.875%, 9/15/05(e) .................................. Baa 465 520,460 MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- CSC Holdings, Inc. Series B 7.625%, 4/1/11 ...................................... B $ 365 $ 365,912 EchoStar DBS Corp. 144A 5.75%, 10/1/08(b) .................................. Ba 360 362,250 Lenfest Communications, Inc. 10.50%, 6/15/06 ..................................... Ba 231 274,601 Liberty Media Corp. 2.64%, 9/17/06(c) ....... Baa 415 412,804 Liberty Media Corp. 3.50%, 9/25/06 .......... Baa 540 538,243 TCI Communications Financing III 9.65%, 3/31/27 ..................................... Ba 270 320,288 Turner Broadcasting System, Inc. 8.40%, 2/1/24 ...................................... Baa 207 218,932 ----------- 4,232,853 ----------- BUILDING PRODUCTS--0.5% American Standard, Inc. 7.625%, 2/15/10 ..... Ba 328 367,360 CASINOS & GAMING--0.8% Boyd Gaming Corp. 7.75%, 12/15/12 ........... B 157 162,888 Park Place Entertainment Corp. 7.875%, 12/15/05 .................................... Ba 360 382,950 ----------- 545,838 ----------- CONSUMER FINANCE--2.7% American General Finance Corp. Series H 4.50%, 11/15/07 ............................. A 272 286,157 General Electric Capital Corp. Series A 2.85%, 1/30/06 .............................. Aaa 345 351,924 General Motors Acceptance Corp. 6.125%, 8/28/07 ..................................... A 311 328,810 Household Finance Corp. 7.875%, 3/1/07 ...... A 87 101,096 John Deere Capital Corp. Series D 4.125%, 7/15/05 ..................................... A 25 26,034 MBNA America Bank NA 5.375%, 1/15/08 ........ Baa 479 515,224 MBNA Corp. 5%, 6/15/15 ...................... Baa 335 323,756 ----------- 1,933,001 ----------- ELECTRIC UTILITIES--1.7% Alabama Power Co. 5.70%, 2/15/33 ............ A 315 314,084 Consolidated Edison Co. of New York 5.875%, 4/1/33 .............................. A 135 138,159 Progress Energy, Inc. 6.75%, 3/1/06 ......... Baa 376 412,608 Southern California Edison Co. 144A 8%, 2/15/07(b) .................................. Ba 330 370,425 ----------- 1,235,276 ----------- See Notes to Financial Statements 6 Phoenix-Seneca Bond Fund MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- ENVIRONMENTAL SERVICES--1.1% Waste Management, Inc. 6.50%, 11/15/08(e) ................................. Baa $ 713 $ 796,288 FOOD RETAIL--0.3% Kroger Co. 8%, 9/15/29(e) ................... Baa 200 245,546 FOREST PRODUCTS--0.4% Weyerhaeuser Co. 6.875%, 12/15/33 ........... Baa 245 259,077 GAS UTILITIES--1.0% NiSource Finance Corp. 7.625%, 11/15/05(e) ................................. Baa 661 730,966 GENERAL MERCHANDISE STORES--0.6% Target Corp. 7%, 7/15/31 .................... A 375 431,777 HEALTH CARE FACILITIES--0.4% HCA, Inc. 6.75%, 7/15/13 .................... Ba 245 257,782 HOMEBUILDING--2.8% D.R. Horton, Inc. 7.50%, 12/1/07 ............ Ba 513 553,399 KB Home 7.75%, 2/1/10 ....................... Ba 445 471,700 NVR, Inc. 5%, 6/15/10 ....................... Ba 239 230,635 Ryland Group 5.375%, 6/1/08 ................. Ba 305 308,431 Toll Corp. 7.75%, 9/15/07 ................... Ba 65 67,031 Toll Corp. 8%, 5/1/09 ....................... Ba 350 369,250 ----------- 2,000,446 ----------- HOTELS, RESORTS & CRUISE LINES--0.7% Hilton Hotels Corp. 7.625%, 12/1/12 ......... Ba 294 322,665 Royal Caribbean Cruises Ltd. 8%, 5/15/10 .... Ba 30 31,800 Royal Caribbean Cruises Ltd. 8.75%, 2/2/11 ...................................... Ba 130 142,350 Royal Caribbean Cruises Ltd. 7.25%, 3/15/18 ..................................... Ba 22 20,460 ----------- 517,275 ----------- HOUSEHOLD APPLIANCES--0.1% Applica, Inc. 10%, 7/31/08 .................. B 48 50,520 HOUSEWARES & SPECIALTIES--0.5% American Greetings Corp. Class A 6.10%, 8/1/28 ...................................... Ba 389 395,808 INTEGRATED OIL & GAS--0.9% ConocoPhillips 3.625%, 10/15/07(e) .......... A 630 641,486 INTEGRATED TELECOMMUNICATION SERVICES--4.1% Citizens Communications 8.50%, 5/15/06 ...... Baa 483 554,270 Sprint Capital Corp. 8.75%, 3/15/32(e) ...... Baa 905 1,075,351 Verizon Global Funding Corp. 7.75%, 12/1/30 ..................................... A 1,087 1,305,711 ----------- 2,935,332 ----------- MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- INVESTMENT BANKING & BROKERAGE--1.9% Bear Stearns Co., Inc. 3%, 3/30/06(e) ....... A $ 735 $ 751,920 Goldman Sachs Group, Inc. 6.125%, 2/15/33 ..................................... Aa 440 447,048 Lehman Brothers Holdings, Inc. 4%, 1/22/08 ..................................... A 142 146,192 Morgan Stanley 3.625%, 4/1/08 ............... Aa 41 41,381 ----------- 1,386,541 ----------- METAL & GLASS CONTAINERS--1.2% Ball Corp. 6.875%, 12/15/12 ................. Ba 306 317,092 Owens-Brockway Glass Container, Inc. 8.875%, 2/15/09 ............................. B 298 318,860 Owens-Illinois, Inc. 7.15%, 5/15/05 ........ B 209 214,748 ----------- 850,700 ----------- MOVIES & ENTERTAINMENT--0.7% Time Warner, Inc. 9.125%, 1/15/13 ........... Baa 424 538,782 OIL & GAS EXPLORATION & PRODUCTION--0.2% XTO Energy, Inc. 6.25%, 4/15/13 ............. Ba 160 166,400 PACKAGED FOODS & MEATS--2.4% ConAgra Foods, Inc. 7.50%, 9/15/05(e) ....... Baa 715 789,247 Dean Foods Co. 8.15%, 8/1/07(e) ............. Ba 443 483,424 Kraft Foods, Inc. 4%, 10/1/08 ............... A 445 449,183 ----------- 1,721,854 ----------- PROPERTY & CASUALTY INSURANCE--0.2% Fund American Cos., Inc. 5.875%, 5/15/13 .... Baa 170 172,986 REAL ESTATE MANAGEMENT & DEVELOPMENT--0.3% LNR Property Corp. 144A 7.625%, 7/15/13(b) .................................. Ba 235 243,225 REGIONAL BANKS--0.5% Colonial Bank 9.375%, 6/1/11 ................ Ba 338 394,224 REITS--0.3% Archstone-Smith Trust 7.90%, 2/15/16 ........ Baa 191 232,939 RESTAURANTS--1.2% Yum! Brands, Inc. 7.70%, 7/1/12(e) .......... Ba 748 832,150 THRIFTS & MORTGAGE FINANCE--2.1% Golden West Financial Corp. 4.75%, 10/1/12 ..................................... A 513 523,912 Sovereign Bank Class A-1 144A 10.20%, 6/30/05(b)(e) ............................... Baa 942 1,019,762 ----------- 1,543,674 ----------- See Notes to Financial Statements 7 Phoenix-Seneca Bond Fund MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- TOBACCO--0.4% Altria Group, Inc. 7.20%, 2/1/07 ............ Baa $ 175 $ 187,665 DIMON, Inc. Series B 9.625%, 10/15/11 ....... Ba 120 134,100 ----------- 321,765 ----------- TRUCKING--1.0% Avis Group Holdings, Inc. 11%, 5/1/09 ....... Baa 169 187,590 Hertz Corp. 4.70%, 10/2/06 .................. Baa 515 517,384 ----------- 704,974 ----------- - ----------------------------------------------------------------------------- TOTAL CORPORATE BONDS (IDENTIFIED COST $28,142,866) 29,594,466 - ----------------------------------------------------------------------------- FOREIGN GOVERNMENT SECURITIES--1.0% MEXICO--1.0% United Mexican States 6.375%, 1/16/13 ....... Baa 351 370,305 United Mexican States 8%, 9/24/22 ........... Baa 296 326,340 - ----------------------------------------------------------------------------- TOTAL FOREIGN GOVERNMENT SECURITIES (IDENTIFIED COST $639,823) 696,645 - ----------------------------------------------------------------------------- FOREIGN CORPORATE BONDS--6.4% CANADA--3.1% Abitibi-Consolidated, Inc. 8.30%, 8/1/05 .... Ba 345 365,890 Cascades, Inc. 144A 7.25%, 2/15/13(b) ....... Ba 296 303,400 Corus Entertainment, Inc. 8.75%, 3/1/12 ..... B 82 89,790 IPSCO, Inc. 144A 8.75%, 6/1/13(b) ........... Ba 206 216,300 Norske Skog Canada Ltd. Series D 8.625%, 6/15/11 ............................. Ba 180 188,325 Rogers Cablesystems Series B 10%, 3/15/05 ..................................... Ba 270 290,925 Telus Corp. 7.50%, 6/1/07 ................... Ba 1 1,126 Tembec Industries, Inc. 8.625%, 6/30/09 ..... Ba 190 188,100 Tembec Industries, Inc. 8.50%, 2/1/11 ....... Ba 205 200,900 TransCanada Pipelines Ltd. 4%, 6/15/13 ...... A 470 443,878 ----------- 2,288,634 ----------- FRANCE--0.5% Crown European Holdings SA 144A 9.50%, 3/1/11(b) ............................ B 365 394,200 MOODY'S PAR RATING VALUE (Unaudited) (000) VALUE ----------- ------- ----------- NETHERLANDS--1.1% ABN Amro Bank NV 144A 4.65%, 6/4/18(b) ................................... A $ 240 $ 227,727 Deutsche Telekom International Finance BV 8.25%, 6/15/05 .............................. Baa 495 545,167 ----------- 772,894 ----------- UNITED KINGDOM--1.7% BP Capital Markets plc 2.625%, 3/15/07 ...... Aa 360 362,154 British Sky Broadcasting Group plc 8.20%, 7/15/09(e) .................................. Ba 715 849,521 ----------- 1,211,675 ----------- - ----------------------------------------------------------------------------- TOTAL FOREIGN CORPORATE BONDS (IDENTIFIED COST $4,640,476) 4,667,403 - ----------------------------------------------------------------------------- CONVERTIBLE BONDS--1.0% SEMICONDUCTORS--1.0% Analog Devices, Inc. Cv. 4.75%, 10/1/05 ..... Baa 725 737,687 - ----------------------------------------------------------------------------- TOTAL CONVERTIBLE BONDS (IDENTIFIED COST $725,308) 737,687 - ----------------------------------------------------------------------------- TOTAL LONG TERM INVESTMENTS--95.3% (IDENTIFIED COST $67,216,219) 68,845,066 - ----------------------------------------------------------------------------- SHORT-TERM OBLIGATIONS--13.3% FEDERAL AGENCY SECURITIES--13.3% FHLB Discount Note 0.95%, 10/1/03 ........... 9,600 9,600,000 - ----------------------------------------------------------------------------- TOTAL SHORT-TERM OBLIGATIONS (IDENTIFIED COST $9,600,000) 9,600,000 - ----------------------------------------------------------------------------- TOTAL INVESTMENTS--108.6% (IDENTIFIED COST $76,816,219) 78,445,066(a) Other assets and liabilities, net--(8.6)% (6,243,698) ----------- NET ASSETS--100.0% $72,201,368 =========== (a) Federal Income Tax Information: Net unrealized appreciation of investment securities is comprised of gross appreciation of $1,841,726 and gross depreciation of $233,860 for federal income tax purposes. At September 30, 2003, the aggregate cost of securities for federal income tax purposes was $76,837,200. (b) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2003, these securities amounted to a value of $3,137,289 or 4.4% of net assets. (c) Variable or step coupon security; interest rate shown reflects the rate currently in effect. (d) As rated by Standard & Poor's or Fitch. (e) All or a portion segregated as collateral for delayed delivery contracts. (f) Principal amount is adjusted daily pursuant to the change in the Consumer Price Index. See Notes to Financial Statements 8 Phoenix-Seneca Bond Fund STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 2003 ASSETS Investment securities at value (Identified cost $76,816,219) $78,445,066 Cash 63,667 Receivables Investment securities sold 2,719,981 Interest 661,043 Fund shares sold 47,220 Prepaid expenses 1,708 ----------- Total assets 81,938,685 ----------- LIABILITIES Payables Investment securities purchased 9,590,631 Fund shares repurchased 33,401 Transfer agent fee 18,013 Distribution and service fees 16,520 Investment advisory fee 15,518 Financial agent fee 6,972 Trustees' fee 878 Payable to adviser 77 Accrued expenses 55,307 ----------- Total liabilities 9,737,317 ----------- NET ASSETS $72,201,368 =========== NET ASSETS CONSIST OF: Capital paid in on shares of beneficial interest $69,937,584 Undistributed net investment income 431,853 Accumulated net realized gain 203,084 Net unrealized appreciation 1,628,847 ----------- NET ASSETS $72,201,368 =========== CLASS X Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $35,966,391) 3,337,408 Net asset value and offering price per share $10.78 CLASS A Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $21,263,023) 1,990,406 Net asset value per share $10.68 Offering price per share $10.68/(1-4.75%) $11.21 CLASS B Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $10,218,398) 972,808 Net asset value and offering price per share $10.50 CLASS C Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $4,753,556) 451,779 Net asset value and offering price per share $10.52 STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 2003 INVESTMENT INCOME Interest $3,586,424 ---------- Total investment income 3,586,424 ---------- EXPENSES Investment advisory fee 373,661 Service fees, Class A 53,609 Distribution and service fees, Class B 108,379 Distribution and service fees, Class C 50,673 Financial agent fee 88,867 Transfer agent 96,610 Professional 42,514 Registration 42,248 Custodian 27,330 Printing 16,399 Trustees 11,086 Miscellaneous 20,519 ---------- Total expenses 931,895 Less expenses borne by investment adviser (60,889) Custodian fees paid indirectly (570) ---------- Net expenses 870,436 ---------- NET INVESTMENT INCOME 2,715,988 ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized gain on securities 2,948,318 Net change in unrealized appreciation (depreciation) on investments 166,483 ---------- NET GAIN ON INVESTMENTS 3,114,801 ---------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $5,830,789 ========== See Notes to Financial Statements 9 Phoenix-Seneca Bond Fund
STATEMENT OF CHANGES IN NET ASSETS Year Ended Year Ended 9/30/03 9/30/02 ----------- ----------- FROM OPERATIONS Net investment income (loss) $ 2,715,988 $ 3,519,396 Net realized gain (loss) 2,948,318 (781,445) Net change in unrealized appreciation (depreciation) 166,483 1,729,657 ----------- ----------- INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 5,830,789 4,467,608 ----------- ----------- FROM DISTRIBUTIONS TO SHAREHOLDERS Net investment income, Class X (1,492,195) (2,299,950) Net investment income, Class A (778,490) (840,732) Net investment income, Class B (318,986) (374,903) Net investment income, Class C (149,071) (186,987) Net realized short-term gains, Class X (217,767) (726,361) Net realized short-term gains, Class A (132,351) (276,722) Net realized short-term gains, Class B (68,404) (134,769) Net realized short-term gains, Class C (31,478) (67,218) ----------- ----------- DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (3,188,742) (4,907,642) ----------- ----------- FROM SHARE TRANSACTIONS CLASS X Proceeds from sales of shares (931,093 and 875,484 shares, respectively) 9,890,760 8,953,585 Net asset value of shares issued from reinvestment of distributions (149,298 and 286,441 shares, respectively) 1,572,658 2,919,131 Cost of shares repurchased (2,422,700 and 1,123,032 shares, respectively) (25,366,816) (11,438,951) ----------- ----------- Total (13,903,398) 433,765 ----------- ----------- CLASS A Proceeds from sales of shares (952,708 and 1,068,591 shares, respectively) 9,955,589 10,885,294 Net asset value of shares issued from reinvestment of distributions (65,813 and 67,268 shares, respectively) 688,645 680,360 Cost of shares repurchased (1,080,334 and 566,845 shares, respectively) (11,324,986) (5,743,494) ----------- ----------- Total (680,752) 5,822,160 ----------- ----------- CLASS B Proceeds from sales of shares (292,241 and 385,681 shares, respectively) 3,004,971 3,867,119 Net asset value of shares issued from reinvestment of distributions (26,320 and 34,119 shares, respectively) 270,800 340,424 Cost of shares repurchased (341,941 and 176,399 shares, respectively) (3,536,816) (1,759,987) ----------- ----------- Total (261,045) 2,447,556 ----------- ----------- CLASS C Proceeds from sales of shares (195,645 and 246,752 shares, respectively) 2,009,923 2,471,471 Net asset value of shares issued from reinvestment of distributions (13,767 and 20,043 shares, respectively) 141,868 200,275 Cost of shares repurchased (255,505 and 143,299 shares, respectively) (2,625,231) (1,436,614) ----------- ----------- Total (473,440) 1,235,132 ----------- ----------- INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (15,318,635) 9,938,613 ----------- ----------- NET INCREASE (DECREASE) IN NET ASSETS (12,676,588) 9,498,579 NET ASSETS Beginning of period 84,877,956 75,379,377 ----------- ----------- END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $431,853 AND $454,609, RESPECTIVELY] $72,201,368 $84,877,956 =========== ===========
See Notes to Financial Statements 10 Phoenix-Seneca Bond Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS X ----------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------- 2003 2002(8) 2001 2000 1999 Net asset value, beginning of period $10.39 $10.44 $10.16 $10.35 $10.68 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.41 0.48 0.70 0.77 0.69 Net realized and unrealized gain (loss) 0.46 0.12 0.26 (0.18) (0.31) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 0.87 0.60 0.96 0.59 0.38 ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.42) (0.49) (0.68) (0.71) (0.62) Distributions from net realized gains (0.06) (0.16) -- (0.07) (0.09) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.48) (0.65) (0.68) (0.78) (0.71) ------ ------ ------ ------ ------ Change in net asset value 0.39 (0.05) 0.28 (0.19) (0.33) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $10.78 $10.39 $10.44 $10.16 $10.35 ====== ====== ====== ====== ====== Total return 8.57% 5.94% 9.84% 6.17% 3.51% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $35,966 $48,606 $48,448 $39,981 $34,853 RATIO TO AVERAGE NET ASSETS OF: Operating expenses 0.86%(5) 0.82%(6) 0.84%(6) 0.90%(3)(6) 1.06%(3)(5) Net investment income 3.93% 4.75% 6.79% 7.67% 6.60% Portfolio turnover 244% 410% 170% 74% 95% CLASS A ----------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------- 2003 2002(8) 2001 2000 1999 Net asset value, beginning of period $10.29 $10.37 $10.11 $10.29 $10.68 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.38 0.44 0.67 0.75 0.59 Net realized and unrealized gain (loss) 0.45 0.11 0.26 (0.18) (0.33) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 0.83 0.55 0.93 0.57 0.26 ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.38) (0.47) (0.67) (0.68) (0.56) Distributions from net realized gains (0.06) (0.16) -- (0.07) (0.09) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.44) (0.63) (0.67) (0.75) (0.65) ------ ------ ------ ------ ------ Change in net asset value 0.39 (0.08) 0.26 (0.18) (0.39) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $10.68 $10.29 $10.37 $10.11 $10.29 ====== ====== ====== ====== ====== Total return(2) 8.28% 5.50% 9.54% 5.84% 2.46% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $21,263 $21,127 $15,376 $7,335 $2,732 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(4) 1.15%(5) 1.15%(5) 1.15%(7) 1.15%(7) 1.88%(5) Net investment income 3.65% 4.38% 6.42% 7.60% 5.80% Portfolio turnover 244% 410% 170% 74% 95% (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 1.13% and 3.41% for the periods ended September 30, 2000 and 1999, respectively. (4) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 1.21%, 1.22%, 1.27%, 1.81% and 4.08% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (5)The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would not significantly differ. (6) For the periods ended September 30, 2002, 2001 and 2000, the ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would have been 0.83%, 0.85% and 0.91%, respectively. (7) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would have been 1.16%. (8) As required, effective October 1, 2001, the Fund has adopted the provisions of AICPA Audit and Accounting Guide for Investment Companies and began including paydown gains and losses in interest income. The effect of this change for the year ended September 30, 2002, was to decrease the ratio of net investment income to average net assets from 4.80% to 4.75% and from 4.44% to 4.38% for Class X and Class A, respectively; to decrease net investment income (loss) per share from 0.49 to 0.48 per share and from 0.45 to 0.44 per share for Class X and Class A, respectively; and, to increase net realized and unrealized gain (loss) from 0.11 to 0.12 per share and from 0.10 to 0.11 per share for Class X and Class A, respectively. Per share ratios and supplemental data for prior periods have not been restated to reflect this change.
See Notes to Financial Statements 11 Phoenix-Seneca Bond Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS B ----------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------- 2003 2002(7) 2001 2000 1999 Net asset value, beginning of period $10.13 $10.25 $10.04 $10.27 $10.67 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.30 0.36 0.57 0.68 0.52 Net realized and unrealized gain (loss) 0.44 0.11 0.28 (0.20) (0.33) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 0.74 0.47 0.85 0.48 0.19 ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.31) (0.43) (0.64) (0.64) (0.50) Distributions from net realized gains (0.06) (0.16) -- (0.07) (0.09) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.37) (0.59) (0.64) (0.71) (0.59) ------ ------ ------ ------ ------ Change in net asset value 0.37 (0.12) 0.21 (0.23) (0.40) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $10.50 $10.13 $10.25 $10.04 $10.27 ====== ====== ====== ====== ====== Total return(2) 7.43% 4.83% 8.67% 5.06% 1.67% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $10,218 $10,093 $7,713 $3,086 $1,593 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(3) 1.90%(5) 1.90%(5) 1.90%(6) 1.90%(6) 2.62%(5) Net investment income 2.91% 3.63% 5.64% 6.83% 5.09% Portfolio turnover 244% 410% 170% 74% 95% CLASS C ----------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------- 2003 2002(7) 2001 2000 1999 Net asset value, beginning of period $10.15 $10.26 $10.06 $10.27 $10.67 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.30 0.36 0.58 0.69 0.49 Net realized and unrealized gain (loss) 0.44 0.12 0.26 (0.20) (0.30) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 0.74 0.48 0.84 0.49 0.19 ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.31) (0.43) (0.64) (0.63) (0.50) Distributions from net realized gains (0.06) (0.16) -- (0.07) (0.09) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.37) (0.59) (0.64) (0.70) (0.59) ------ ------ ------ ------ ------ Change in net asset value 0.37 (0.11) 0.20 (0.21) (0.40) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $10.52 $10.15 $10.26 $10.06 $10.27 ====== ====== ====== ====== ====== Total return(2) 7.42% 4.83% 8.65% 5.12% 1.66% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $4,754 $5,052 $3,842 $1,957 $444 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(4) 1.90%(5) 1.90%(5) 1.90%(6) 1.90%(6) 2.91%(5) Net investment income 2.91% 3.63% 5.69% 6.88% 4.71% Portfolio turnover 244% 410% 170% 74% 95% (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 2.10%, 2.16%, 2.35%, 3.08% and 5.67% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (4) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 2.41%, 2.50%, 2.78%, 4.08% and 9.50% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (5) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would not significantly differ. (6) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would have been 1.91%. (7) As required, effective October 1, 2001, the Fund has adopted the provisions of AICPA Audit and Accounting Guide for Investment Companies and began including paydown gains and losses in interest income. The effect of this change for the year ended September 30, 2002, was to decrease the ratio of net investment income to average net assets from 3.69% to 3.63% for Class B and Class C; to decrease net investment income (loss) per share from 0.37 to 0.36 per share for Class B and Class C; and, to increase net realized and unrealized gain (loss) from 0.10 to 0.11 per share and from 0.11 to 0.12 per share for Class B and Class C, respectively. Per share ratios and supplemental data for prior periods have not been restated to reflect this change.
See Notes to Financial Statements 12 PHOENIX-SENECA MID-CAP "EDGE"SM FUND A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGEMENT TEAM, GAIL SENECA, PH.D., RICK LITTLE, CFA AND RON JACKS, CFA Q: WHAT IS THE FUND'S INVESTMENT OBJECTIVE? A: The Phoenix-Seneca Mid-Cap "EDGE"SM Fund seeks capital appreciation. Q: HOW DID THE FUND PERFORM FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003? A: For the 12 months ended September 30, 2003, Class X shares rose 18.94%, Class A shares gained 18.69%, Class B shares were up 17.74%, and Class C shares were up 17.83%. For the same period, the Russell Midcap Growth Index 1 rose 38.89%. All performance figures assume reinvestment of distributions and exclude the effect of sales charges. Past performance is not a guarantee of future performance. Q: WHAT FACTORS AFFECTED PERFORMANCE? A: Stocks have come a long way since the depths of a year ago, and Seneca's portfolios have participated. The rally will continue, in our view, because corporate profits are now growing at double-digit rates. Years of cost cutting, balance sheet repair and a revival of business spending are boosting corporate cash flow and profits. This year's rally correctly reflects the profit revival. Our concerns center on the quality of the rally. This year's stock market winners have been the lowest quality, most speculative stocks. Companies that started the year with the lowest stock prices, less than $5 per share, have far outpaced others. Small companies without current earnings have gained over 50%. Returns on the smallest capitalization companies, the "microcaps," have outpaced all others. The lowest "quality" companies, as measured by S&P ratings, have massively exceeded the returns on the highest quality companies. Despite the consternation about earnings quality and transparency, this year's rally has rewarded companies who have chosen not to expense options, and punished those who pay dividends or have historically high returns on equity. The sprint in the low quality companies has occurred amidst a broad move upward for most stocks. Unlike other bear market rallies, when low quality stocks benefited solely from short covering, this year's rally clearly has sturdier legs. But the persistent outperformance of low quality, tiny companies without earnings has endured for a long stretch of time, fully twelve months. This speculative activity should not persist in a market of serious investors. Q: WHAT SECTORS OR STOCKS HELPED OR DETRACTED FROM PERFORMANCE? A: Health Care holdings in the Fund have been the largest contributors to relative performance over the last twelve months. During the period, the Fund was slightly underweight in the sector relative to the Russell Midcap Growth Index and two of the top ten contributors for the period were Health Care concerns. Holdings within the Consumer Discretionary sector were the largest detractors from relative performance during the period. The Fund was slightly overweight in the sector and achieved positive returns but relative performance of the Fund's holdings was not as strong as that of the Index. The Telecommunication Service and Utilities 1 THE RUSSELL MIDCAP GROWTH INDEX MEASURES MID-CAPITALIZATION, GROWTH-ORIENTED STOCK TOTAL-RETURN PERFORMANCE. THE INDEX IS UNMANAGED, DOES NOT REFLECT MANAGEMENT FEES, AND IS NOT AVAILABLE FOR DIRECT INVESTMENT. 13 Phoenix-Seneca Mid-Cap "EDGE"SM Fund (continued) sectors were up significantly for the period, but because of their weak earnings fundamentals the Fund had no exposure to those sectors. Q: WHAT WOULD YOU ADVISE INVESTORS TODAY? A: As fundamentally based investors, we have not chased the low quality, speculative names which have dominated during the bear market rallies and for the last full year. We have generated double-digit returns in portfolios comprised of high quality companies. Measures of our portfolios' earnings quality rank well above those of the market indexes. Over almost fifteen years, our high quality approach has produced strong returns, in excess of the market averages. In these last few years, in the aftermath of the economic and market "bubble," speculation has been more profitable than investment discipline. The two most recent quarters were the first time the market realized consecutive quarterly positive returns since early 1999. Shorting stocks aggressively through the downturns, and then buying the lowest priced issues during the occasional market rallies has worked best for over three years. As the economy gains traction and corporate profit growth returns to long term trends, investing rather than speculation will perform more reliably. In the interim, we hope our clients, who value quality and sound investment discipline, will resist the lure of speculation. In a world of tough global competition and historic single-digit growth, we'd rather invest in the highest quality companies, rather than speculate with the lowest. OCTOBER 2003 THE PRECEDING INFORMATION IS THE OPINION OF FUND MANAGEMENT. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS, AND THERE IS NO GUARANTEE THAT MARKET FORECASTS DISCUSSED WILL BE REALIZED. 14 Phoenix-Seneca Mid-Cap "EDGE"SM Fund - -------------------------------------------------------------------------------- ANNUAL TOTAL RETURNS 1 PERIOD ENDING 9/30/03 - -------------------------------------------------------------------------------- INCEPTION INCEPTION 1 YEAR 5 YEARS TO 9/30/03 DATE ------ ------- ---------- --------- Class X Shares at NAV 2 18.94% 6.16% 10.67% 3/8/96 Class A Shares at NAV 2 18.69 5.82 10.30 3/8/96 Class A Shares at POP 3 11.87 4.57 9.44 3/8/96 Class B Shares at NAV 2 17.74 4.94 0.36 7/1/98 Class B Shares with CDSC 4 13.74 4.94 0.36 7/1/98 Class C Shares at NAV 2 17.83 4.97 0.37 7/1/98 Class C Shares with CDSC 4 17.83 4.97 0.37 7/1/98 Russell Midcap Growth Index 8 38.89 4.49 Note 5 Note 5 S&P 500(R) Index 9 24.43 1.00 Note 6 Note 6 - -------------------------------------------------------------------------------- GROWTH OF $10,000 PERIODS ENDING 9/30 - -------------------------------------------------------------------------------- 7 This Growth of $10,000 chart assumes an initial investment of $10,000 made on 3/8/96 (inception of the Fund) in Class X and A shares. The total return for Class X shares reflects no sales charge. The total return for Class A shares reflects the maximum sales charge of 5.75% on the initial investment. Performance assumes dividends and capital gains are reinvested. The performance of other share classes will be greater or less than that shown based on differences in inception dates, fees and sales charges. [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
Phoenix-Seneca Mid-Cap "EDGE"SM Phoenix-Seneca Mid-Cap "EDGE"SM Fund Class X at NAV 7 Fund Class A at POP 7 Russell Midcap Growth Index 8 S&P 500(R) Index 9 3/8/96 $10,000.00 $9,425.00 $10,000.00 $10,000.00 9/30/96 $14,970.00 $14,071.53 $11,010.38 $10,991.59 9/30/97 $16,675.62 $15,653.94 $14,274.04 $15,461.54 9/30/98 $15,972.25 $14,911.85 $12,936.58 $16,876.33 9/30/99 $21,245.94 $19,724.19 $17,747.91 $21,556.16 9/30/00 $40,751.35 $37,732.60 $28,462.78 $24,437.54 9/30/01 $22,720.38 $20,970.17 $13,728.30 $17,928.61 9/30/02 $18,103.95 $16,669.99 $11,600.50 $14,256.72 9/30/03 $21,533.71 $19,786.26 $16,112.24 $17,739.39
- -------------------------------------------------------------------------------- SECTOR WEIGHTINGS 9/30/03 - -------------------------------------------------------------------------------- As a percentage of equity holdings [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Information Technology 33% Consumer Discretionary 25 Health-Care 22 Industrials 8 Financials 7 Energy 3 Consumer Staples 2 1 Total returns are historical and include changes in share price and the reinvestment of both dividends and capital gains distributions. 2 "NAV" (Net Asset Value) total returns do not include the effect of any sales charge. 3 "POP" (Public Offering Price) total returns include the effect of the maximum front-end 5.75% sales charge. 4 CDSC (contingent deferred sales charge) is applied to redemptions of certain classes of shares that do not have a sales charge applied at the time of purchase. CDSC charges for B shares decline from 5% to 0% over a five year period. CDSC charges for C shares are 1% in the first year and 0% thereafter. 5 Index performance is 6.51% for Class X and Class A (since 3/8/96) and 0.56% for Class B and Class C (since 7/1/98). 6 Index performance is 7.87% for Class X and Class A (since 3/8/96) and (1.26)% for Class B and Class C (since 7/1/98). 7 This chart illustrates NAV returns on Class X shares and POP returns on Class A shares. Returns on Class B and Class C shares will vary due to differing sales charges, fees and inception dates. 8 The Russell Midcap Growth Index is an unmanaged, commonly used measure of total return performance of mid-capitalization growth-oriented stocks. The index's performance does not reflect management fees and sales charges. 9 The S&P 500(R) Index is a measure of stock market total return performance and is provided for general comparative purposes. The index's performance does not reflect management fees and sales charges. All returns represent past performance which is not indicative of future performance. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. 15 Phoenix-Seneca Mid-Cap "EDGE"SM Fund - -------------------------------------------------------------------------------- TEN LARGEST HOLDINGS AT SEPTEMBER 30, 2003 (AS A PERCENTAGE OF TOTAL NET ASSETS) - -------------------------------------------------------------------------------- 1. New York Community Bancorp, Inc. 3.6% 2. Chiron Corp. 3.4% 3. Fiserv, Inc. 3.3% 4. Dollar Tree Stores, Inc. 3.2% 5. Network Appliance, Inc. 3.2% 6. Barr Laboratories, Inc. 3.2% 7. Sanmina-SCI Corp. 3.1% 8. Gilead Sciences, Inc. 3.1% 9. IVAX Corp. 3.0% 10. Williams-Sonoma, Inc. 3.0% - -------------------------------------------------------------------------------- INVESTMENTS AT SEPTEMBER 30, 2003 SHARES VALUE -------- ------------ COMMON STOCKS--87.5% APPAREL RETAIL--2.4% TJX Cos., Inc. (The) ............................. 172,240 $ 3,344,901 BIOTECHNOLOGY--9.4% Chiron Corp.(b) .................................. 89,506 4,626,565 Gilead Sciences, Inc.(b) ......................... 75,470 4,221,037 MedImmune, Inc.(b) ............................... 125,110 4,129,881 ------------ 12,977,483 ------------ COMMUNICATIONS EQUIPMENT--2.1% Corning, Inc.(b) ................................. 304,860 2,871,781 COMPUTER & ELECTRONICS RETAIL--1.8% Circuit City Stores, Inc. ........................ 263,150 2,507,819 COMPUTER STORAGE & PERIPHERALS--3.2% Network Appliance, Inc.(b) ....................... 212,430 4,361,188 CONSTRUCTION, FARM MACHINERY & HEAVY TRUCKS--2.3% PACCAR, Inc. ..................................... 42,800 3,196,732 CONSUMER FINANCE--2.5% Providian Financial Corp.(b) ..................... 294,700 3,474,513 DATA PROCESSING & OUTSOURCED SERVICES--3.3% Fiserv, Inc.(b) .................................. 126,820 4,594,689 ELECTRONIC MANUFACTURING SERVICES--5.6% Jabil Circuit, Inc.(b) ........................... 132,710 3,457,096 Sanmina-SCI Corp.(b) ............................. 441,639 4,283,898 ------------ 7,740,994 ------------ EMPLOYMENT SERVICES--1.7% Monster Worldwide, Inc.(b) ....................... 92,080 2,318,574 GENERAL MERCHANDISE STORES--3.2% Dollar Tree Stores, Inc.(b) ...................... 132,510 4,439,085 HEALTH CARE EQUIPMENT--2.1% Zimmer Holdings, Inc. ............................ 52,300 2,881,730 HEALTH CARE FACILITIES--1.5% Manor Care, Inc. ................................. 67,300 2,019,000 SHARES VALUE -------- ------------ HOME FURNISHINGS--2.0% Mohawk Industries, Inc.(b) ....................... 38,560 $ 2,750,099 HOTELS, RESORTS & CRUISE LINES--1.6% Starwood Hotels & Resorts Worldwide, Inc. ........ 64,320 2,238,336 INDUSTRIAL MACHINERY--2.9% Ingersoll-Rand Co. Class A ....................... 74,670 3,990,365 INTERNET SOFTWARE & SERVICES--2.3% VeriSign, Inc.(b) ................................ 229,600 3,092,712 LEISURE PRODUCTS--0.5% Hasbro, Inc. ..................................... 34,320 641,098 OIL & GAS EQUIPMENT & SERVICES--2.6% Cooper Cameron Corp.(b) .......................... 78,270 3,616,857 PHARMACEUTICALS--6.8% Barr Laboratories, Inc.(b) ....................... 63,690 4,344,295 IVAX Corp.(b) .................................... 213,470 4,184,012 Pharmaceutical Resources, Inc.(b) ................ 12,530 854,796 ------------ 9,383,103 ------------ RESTAURANTS--4.1% Starbucks Corp.(b) ............................... 96,290 2,773,152 Yum! Brands, Inc.(b) ............................. 94,930 2,811,827 ------------ 5,584,979 ------------ SEMICONDUCTOR EQUIPMENT--2.5% KLA-Tencor Corp.(b) .............................. 65,480 3,365,672 SEMICONDUCTORS--2.3% Altera Corp.(b) .................................. 170,510 3,222,639 SOFT DRINKS--2.2% Coca-Cola Enterprises, Inc. ...................... 157,110 2,994,517 SPECIALTY STORES--7.0% PETsMART, Inc.(b) ................................ 120,320 2,731,264 Staples, Inc.(b) ................................. 116,270 2,761,413 Williams-Sonoma, Inc.(b) ......................... 153,830 4,150,333 ------------ 9,643,010 ------------ See Notes to Financial Statements 16 Phoenix-Seneca Mid-Cap "EDGE"SM Fund SHARES VALUE -------- ------------ SYSTEMS SOFTWARE--4.0% Adobe Systems, Inc. .............................. 69,420 $ 2,725,429 Symantec Corp.(b) ................................ 44,550 2,807,541 ------------ 5,532,970 ------------ TECHNOLOGY DISTRIBUTORS--2.0% CDW Corp. ........................................ 48,150 2,780,181 THRIFTS & MORTGAGE FINANCE--3.6% New York Community Bancorp, Inc. ................. 157,173 4,952,521 - ----------------------------------------------------------------------------- TOTAL COMMON STOCKS (IDENTIFIED COST $115,907,521) 120,517,548 - ----------------------------------------------------------------------------- FOREIGN COMMON STOCKS--2.9% SEMICONDUCTORS--2.9% Infineon Technologies AG ADR (Germany)(b) ........ 309,630 3,991,131 - ----------------------------------------------------------------------------- TOTAL FOREIGN COMMON STOCKS (IDENTIFIED COST $4,106,186) 3,991,131 - ----------------------------------------------------------------------------- TOTAL LONG TERM INVESTMENTS--90.4% (IDENTIFIED COST $120,013,707) 124,508,679 - ----------------------------------------------------------------------------- PAR VALUE (000) ------ SHORT-TERM OBLIGATIONS--5.7% REPURCHASE AGREEMENTS--5.7% State Street Bank & Trust Co. repurchase agreement, 0.25% dated 9/30/03 due 10/1/03, repurchase price $7,816,054 collateralized by U.S. Treasury Note 3.625%, 3/31/04, market value $7,972,743 ................................. $7,816 $ 7,816,000 - ----------------------------------------------------------------------------- TOTAL SHORT-TERM OBLIGATIONS (IDENTIFIED COST $7,816,000) 7,816,000 - ----------------------------------------------------------------------------- TOTAL INVESTMENTS--96.1% (IDENTIFIED COST $127,829,707) 132,324,679(a) Other assets and liabilities, net--3.9% 5,334,685 ------------ NET ASSETS--100.0% $137,659,364 ============ (a) Federal Income Tax Information: Net unrealized appreciation of investment securities is comprised of gross appreciation of $8,714,323 and gross depreciation of $4,219,351 for federal income tax purposes. At September 30, 2003, the aggregate cost of securities for federal income tax purposes was $127,829,707. (b) Non-income producing. See Notes to Financial Statements 17 Phoenix-Seneca Mid-Cap "EDGE"SM Fund STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 2003 ASSETS Investment securities at value (Identified cost $127,829,707) $132,324,679 Cash 283 Receivables Investment securities sold 10,108,052 Fund shares sold 241,792 Dividends and interest 13,173 Prepaid expenses 3,222 ------------ Total assets 142,691,201 ------------ LIABILITIES Payables Investment securities purchased 4,509,155 Fund shares repurchased 212,609 Investment advisory fee 106,820 Transfer agent fee 66,942 Distribution and service fees 63,228 Financial agent fee 10,200 Trustees' fee 878 Accrued expenses 62,005 ------------ Total liabilities 5,031,837 ------------ NET ASSETS $137,659,364 ============ NET ASSETS CONSIST OF: Capital paid in on shares of beneficial interest $215,892,795 Accumulated net realized loss (82,728,403) Net unrealized appreciation 4,494,972 ------------ NET ASSETS $137,659,364 ============ CLASS X Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $18,005,103) 1,210,018 Net asset value and offering price per share $14.88 CLASS A Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $63,365,168) 4,357,336 Net asset value per share $14.54 Offering price per share $14.54/(1-5.75%) $15.43 CLASS B Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $24,171,526) 1,742,118 Net asset value and offering price per share $13.87 CLASS C Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $32,117,567) 2,314,760 Net asset value and offering price per share $13.88 STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 2003 INVESTMENT INCOME Dividends $ 502,807 Interest 19,253 ----------- Total investment income 522,060 ----------- EXPENSES Investment advisory fee 1,076,676 Service fees, Class A 161,320 Distribution and service fees, Class B 233,737 Distribution and service fees, Class C 319,694 Financial agent fee 127,974 Transfer agent 357,739 Printing 62,421 Registration 52,511 Professional 40,833 Custodian 16,016 Trustees 11,086 Miscellaneous 18,342 ----------- Total expenses 2,478,349 Less expenses borne by investment adviser (215,880) Custodian fees paid indirectly (3) ----------- Net expenses 2,262,466 ----------- NET INVESTMENT LOSS (1,740,406) ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized loss on securities (9,256,160) Net change in unrealized appreciation (depreciation) on investments 33,021,742 ----------- NET GAIN ON INVESTMENTS 23,765,582 ----------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $22,025,176 =========== See Notes to Financial Statements 18 Phoenix-Seneca Mid-Cap "EDGE"SM Fund
STATEMENT OF CHANGES IN NET ASSETS Year Ended Year Ended 9/30/03 9/30/02 ------------ ------------ FROM OPERATIONS Net investment income (loss) $ (1,740,406) $ (2,144,534) Net realized gain (loss) (9,256,160) (41,965,558) Net change in unrealized appreciation (depreciation) 33,021,742 3,627,837 ------------ ------------ INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 22,025,176 (40,482,255) ------------ ------------ FROM SHARE TRANSACTIONS CLASS X Proceeds from sales of shares (567,444 and 245,953 shares, respectively) 7,557,348 4,301,629 Cost of shares repurchased (254,379 and 253,619 shares, respectively) (3,346,680) (4,129,658) ------------ ------------ Total 4,210,668 171,971 ------------ ------------ CLASS A Proceeds from sales of shares (1,673,842 and 3,287,089 shares, respectively) 22,497,136 55,903,216 Cost of shares repurchased (2,734,805 and 2,177,539 shares, respectively) (36,063,026) (35,463,581) ------------ ------------ Total (13,565,890) 20,439,635 ------------ ------------ CLASS B Proceeds from sales of shares (251,861 and 720,227 shares, respectively) 3,179,186 11,693,404 Cost of shares repurchased (426,167 and 378,710 shares, respectively) (5,331,313) (5,666,375) ------------ ------------ Total (2,152,127) 6,027,029 ------------ ------------ CLASS C Proceeds from sales of shares (417,888 and 1,318,694 shares, respectively) 5,334,001 21,920,511 Cost of shares repurchased (762,053 and 728,101 shares, respectively) (9,688,751) (11,582,879) ------------ ------------ Total (4,354,750) 10,337,632 ------------ ------------ INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (15,862,099) 36,976,267 ------------ ------------ NET INCREASE (DECREASE) IN NET ASSETS 6,163,077 (3,505,988) NET ASSETS Beginning of period 131,496,287 135,002,275 ------------ ------------ END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $0 AND $0, RESPECTIVELY] $137,659,364 $131,496,287 ============ ============
See Notes to Financial Statements 19 Phoenix-Seneca Mid-Cap "EDGE"SM Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS X ---------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ---------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $12.51 $15.70 $ 31.18 $17.78 $13.81 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) (0.11) (0.13) (0.14) (0.19) (0.21) Net realized and unrealized gain (loss) 2.48 (3.06) (12.91) 15.65 4.72 ------ ------ ------- ------ ------ TOTAL FROM INVESTMENT OPERATIONS 2.37 (3.19) (13.05) 15.46 4.51 ------ ------ ------- ------ ------ LESS DISTRIBUTIONS: Distributions from net realized gains -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ TOTAL DISTRIBUTIONS -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ Change in net asset value 2.37 (3.19) (15.48) 13.40 3.97 ------ ------ ------- ------ ------ NET ASSET VALUE, END OF PERIOD $14.88 $12.51 $ 15.70 $31.18 $17.78 ====== ====== ======= ====== ====== Total return 18.94 % (20.32)% (44.25)% 91.81 % 33.02 % RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $18,005 $11,219 $14,198 $23,016 $10,640 RATIO TO AVERAGE NET ASSETS OF: Operating expenses 1.15 %(3)(5) 1.15 %(3) 1.15 %(3)(5) 1.27 %(3) 1.96 % Net investment income (loss) (0.77)% (0.75)% (0.61)% (0.72)% (1.27)% Portfolio turnover 164 % 135 % 96 % 124 % 192 % CLASS A ----------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $12.25 $15.41 $ 30.75 $17.60 $13.75 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) (0.13) (0.16) (0.19) (0.24) (0.31) Net realized and unrealized gain (loss) 2.42 (3.00) (12.72) 15.45 4.70 ------ ------ ------- ------ ------ TOTAL FROM INVESTMENT OPERATIONS 2.29 (3.16) (12.91) 15.21 4.39 ------ ------ ------- ------ ------ LESS DISTRIBUTIONS: Distributions from net realized gains -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ TOTAL DISTRIBUTIONS -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ Change in net asset value 2.29 (3.16) (15.34) 13.15 3.85 ------ ------ ------- ------ ------ NET ASSET VALUE, END OF PERIOD $14.54 $12.25 $ 15.41 $30.75 $17.60 ====== ====== ======= ====== ====== Total return(2) 18.69 % (20.51)% (44.42)% 91.30 % 32.27 % RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $63,365 $66,384 $66,411 $50,150 $6,457 RATIO TO AVERAGE NET ASSETS OF: Operating expenses 1.40 %(4)(5) 1.40 %(4) 1.40 %(4)(5) 1.47 %(4) 2.51 % Net investment income (loss) (1.01)% (0.99)% (0.86)% (0.91)% (1.81)% Portfolio turnover 164 % 135 % 96 % 124 % 192 % (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 1.24%, 1.24%, 1.22% and 1.43% for the periods ended September 30, 2003, 2002, 2001 and 2000, respectively. (4) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 1.55%, 1.46%, 1.40% and 1.59% for the periods ended September 30, 2003, 2002, 2001 and 2000, respectively. (5) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would not significantly differ.
See Notes to Financial Statements 20 Phoenix-Seneca Mid-Cap "EDGE"SM Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS B ----------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $11.78 $14.93 $ 30.09 $17.41 $13.73 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) (0.23) (0.28) (0.34) (0.45) (0.47) Net realized and unrealized gain (loss) 2.32 (2.87) (12.39) 15.19 4.69 ------ ------ ------- ------ ------ TOTAL FROM INVESTMENT OPERATIONS 2.09 (3.15) (12.73) 14.74 4.22 ------ ------ ------- ------ ------ LESS DISTRIBUTIONS: Distributions from net realized gains -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ TOTAL DISTRIBUTIONS -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ Change in net asset value 2.09 (3.15) (15.16) 12.68 3.68 ------ ------ ------- ------ ------ NET ASSET VALUE, END OF PERIOD $13.87 $11.78 $ 14.93 $30.09 $17.41 ====== ====== ======= ====== ====== Total return(2) 17.74 % (21.10)% (44.83)% 89.49 % 31.05 % RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $24,172 $22,577 $23,519 $15,879 $1,676 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(3) 2.15 %(5) 2.15 % 2.15 %(5) 2.29 % 3.45 % Net investment income (loss) (1.76)% (1.74)% (1.61)% (1.73)% (2.78)% Portfolio turnover 164 % 135 % 96 % 124 % 192 % CLASS C ----------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ----------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $11.78 $14.93 $ 30.08 $17.40 $13.72 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) (0.22) (0.28) (0.34) (0.45) (0.47) Net realized and unrealized gain (loss) 2.32 (2.87) (12.38) 15.19 4.69 ------ ------ ------- ------ ------ TOTAL FROM INVESTMENT OPERATIONS 2.10 (3.15) (12.72) 14.74 4.22 ------ ------ ------- ------ ------ LESS DISTRIBUTIONS: Distributions from net realized gains -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ TOTAL DISTRIBUTIONS -- -- (2.43) (2.06) (0.54) ------ ------ ------- ------ ------ Change in net asset value 2.10 (3.15) (15.15) 12.68 3.68 ------ ------ ------- ------ ------ NET ASSET VALUE, END OF PERIOD $13.88 $11.78 $ 14.93 $30.08 $17.40 ====== ====== ======= ====== ====== Total return(2) 17.83 % (21.10)% (44.81)% 89.54 % 31.07 % RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $32,118 $31,317 $30,874 $18,218 $975 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(4) 2.15 %(5) 2.15 % 2.15 %(5) 2.25 % 3.45 % Net investment income (loss) (1.76)% (1.74)% (1.61)% (1.68)% (2.78)% Portfolio turnover 164 % 135 % 96 % 124 % 192 % (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 2.46%, 2.43%, 2.34%, 2.70% and 6.33% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (4) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 2.26%, 2.21%, 2.20%, 2.65% and 9.03% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (5) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would not significantly differ.
See Notes to Financial Statements 21 PHOENIX-SENECA REAL ESTATE SECURITIES FUND A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGEMENT TEAM LEADER, DAVID SHAPIRO Q: WHAT IS THE FUND'S INVESTMENT OBJECTIVE? A: The Phoenix-Seneca Real Estate Securities Fund seeks high total return from both current income and long-term capital appreciation. Q: HOW DID THE FUND PERFORM FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003? A: For the 12 months ended September 30, 2003, Class X shares rose 31.60%, Class A shares gained 29.90%, Class B shares were up 28.82%, and Class C shares were up 28.80%. For the same period, the S&P 500(R) Index 1 rose 24.43%, while the Wilshire Real Estate Securities Index 2 returned 26.92%. All performance figures assume reinvestment of distributions and exclude the effect of sales charges. Past performance is not a guarantee of future performance. Q: WHAT FACTORS AFFECTED PERFORMANCE? A: In the first half of the year the Fund positioned its focus away from traditional property REITs to the mortgage finance sector and achieved superior returns as it significantly outperformed its indices in the first half of the year. Q: WHAT SECTORS OR STOCKS HELPED OR DETRACTED FROM PERFORMANCE? A: A significant exposure to the Mortgage REIT sector and the Apartment sector allowed the Fund to produce returns superior to the Fund benchmark. Our lack of exposure to the Hotel sector was detraction from relative performance; however, in our opinion the sector's weak fundamentals have not warranted investment. Q: WHAT IS YOUR OUTLOOK? A: The low interest rate environment and further signs of economic recovery are likely to move prices higher for the stock market generally. However, we are cautious relative to real estate stock prices as underlying fundamentals in most sectors, particularly office and hotels, continue to be weak although signs of strengthening exist. Fund flows into the real estate sector continue strong notwithstanding weak real estate operating fundamentals. We believe the risk/reward scenario in real estate to be driven greatly by the general level of interest rates and will continue to focus our efforts where interest rate levels drive returns, namely mortgage finance, multi-family, industrial and office sectors. OCTOBER 2003 THE PRECEDING INFORMATION IS THE OPINION OF FUND MANAGEMENT. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS, AND THERE IS NO GUARANTEE THAT MARKET FORECASTS DISCUSSED WILL BE REALIZED. 1 THE S&P 500(R) INDEX MEASURES TOTAL-RETURN STOCK MARKET PERFORMANCE. 2 THE WILSHIRE REAL ESTATE SECURITIES INDEX MEASURES REAL ESTATE EQUITY MARKET TOTAL-RETURN PERFORMANCE. THE INDEXES ARE UNMANAGED, DO NOT REFLECT MANAGEMENT FEES, AND ARE NOT AVAILABLE FOR DIRECT INVESTMENT. 22 Phoenix-Seneca Real Estate Securities Fund - -------------------------------------------------------------------------------- ANNUAL TOTAL RETURNS 1 PERIOD ENDING 9/30/03 - -------------------------------------------------------------------------------- INCEPTION INCEPTION 1 YEAR 5 YEARS TO 9/30/03 DATE ------ ------- ---------- --------- Class X Shares at NAV 2 31.60% 11.56% 10.68% 3/12/96 Class A Shares at NAV 2 29.90 10.07 9.31 3/12/96 Class A Shares at POP 3 22.43 8.78 8.46 3/12/96 Class B Shares at NAV 2 28.82 9.21 6.14 7/1/98 Class B Shares with CDSC 4 24.82 9.21 6.14 7/1/98 Class C Shares at NAV 2 28.80 9.22 6.15 7/1/98 Class C Shares with CDSC 4 28.80 9.22 6.15 7/1/98 Wilshire Real Estate Securities Index 8 26.92 12.26 Note 5 Note 5 S&P 500(R) Index 9 24.43 1.00 Note 6 Note 6 - -------------------------------------------------------------------------------- GROWTH OF $10,000 PERIODS ENDING 9/30 - -------------------------------------------------------------------------------- 7 This Growth of $10,000 chart assumes an initial investment of $10,000 made on 3/12/96 (inception of the Fund) in Class X and A shares. The total return for Class X shares reflects no sales charge. The total return for Class A shares reflects the maximum sales charge of 5.75% on the initial investment. Performance assumes dividends and capital gains are reinvested. The performance of other share classes will be greater or less than that shown based on differences in inception dates, fees and sales charges. [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
Phoenix-Seneca Real Estate Phoenix-Seneca Real Estate Securities Fund Securities Fund Wilshire Real Estate Class X at NAV 7 Class A at POP 7 Securuties Index 8 S&P 500(R) Index 9 3/12/96 $10,000.00 $9,425.00 $10,000.00 $10,000.00 9/30/96 $11,261.04 $10,556.51 $11,092.92 $10,929.05 9/30/97 $15,252.30 $14,202.62 $15,755.73 $15,373.57 9/30/98 $12,456.10 $11,430.18 $13,115.99 $16,780.32 9/30/99 $11,626.45 $10,519.46 $12,548.04 $21,433.52 9/30/00 $14,998.16 $13,401.66 $15,718.05 $24,298.51 9/30/01 $16,426.24 $14,468.99 $17,219.24 $17,826.61 9/30/02 $16,356.78 $14,218.65 $18,421.50 $14,175.61 9/30/03 $21,525.99 $18,469.72 $23,380.95 $17,638.47
- -------------------------------------------------------------------------------- SECTOR WEIGHTINGS 9/30/03 - -------------------------------------------------------------------------------- As a percentage of real estate holdings [GRAPHIC OMITTED] EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC Apartments 25% Office 15 Diversified 13 Home Financing 10 Mixed 10 Commercial Financing 10 Regional Malls 7 Other 10 1 Total returns are historical and include changes in share price and the reinvestment of both dividends and capital gains distributions. 2 "NAV" (Net Asset Value) total returns do not include the effect of any sales charge. 3 "POP" (Public Offering Price) total returns include the effect of the maximum front-end 5.75% sales charge. 4 CDSC (contingent deferred sales charge) is applied to redemptions of certain classes of shares that do not have a sales charge applied at the time of purchase. CDSC charges for B shares decline from 5% to 0% over a five year period. CDSC charges for C shares are 1% in the first year and 0% thereafter. 5 Index performance is 11.97% for Class X and Class A (since 3/29/96) and 8.96% for Class B and Class C (since 6/30/98). 6 Index performance is 7.80% for Class X and Class A (since 3/12/96) and (1.26)% for Class B and Class C (since 7/1/98). 7 This chart illustrates NAV returns on Class X shares and POP returns on Class A shares. Returns on Class B and Class C shares will vary due to differing sales charges, fees and inception dates. 8 The Wilshire Real Estate Securities Index is an unmanaged, commonly used measure of real estate equity market total return performance. The index's performance does not reflect management fees and sales charges. 9 The S&P 500(R) Index is a measure of stock market total return performance and is provided for general comparative purposes. The index's performance does not reflect management fees and sales charges. All returns represent past performance which is not indicative of future performance. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. 23 Phoenix-Seneca Real Estate Securities Fund - -------------------------------------------------------------------------------- TEN LARGEST HOLDINGS AT SEPTEMBER 30, 2003 (AS A PERCENTAGE OF TOTAL NET ASSETS) - -------------------------------------------------------------------------------- 1. Redwood Trust, Inc. 6.6% 2. iStar Financial, Inc. 6.5% 3. Fannie Mae 5.9% 4. Simon Property Group, Inc. 5.4% 5. Newcastle Investment Corp. 5.3% 6. Glenborough Realty Trust, Inc. Series A Cv. Pfd. 7.75% 5.0% 7. Freddie Mac 4.4% 8. Reckson Associates Realty Corp. Series A Cv. Pfd. 7.625% 4.2% 9. Masco Corp. 3.8% 10. Reckson Associates Realty Corp. 3.7% - -------------------------------------------------------------------------------- INVESTMENTS AT SEPTEMBER 30, 2003 SHARES VALUE -------- ----------- COMMON STOCKS--86.6% REAL ESTATE INVESTMENT TRUSTS--66.7% DIVERSIFIED--8.3% Cresent Real Estate Equities Co. ................. 30,000 $ 435,000 iStar Financial, Inc. ............................ 39,450 1,536,578 - ----------------------------------------------------------------------------- TOTAL DIVERSIFIED 1,971,578 - ----------------------------------------------------------------------------- INDUSTRIAL/OFFICE--10.1% MIXED--3.7% Reckson Associates Realty Corp. .................. 38,050 879,335 OFFICE--6.4% Equity Office Properties Trust ................... 24,445 672,971 Glenborough Realty Trust, Inc. ................... 10,900 205,574 Trizec Properties, Inc. .......................... 50,900 624,034 ----------- 1,502,579 ----------- - ----------------------------------------------------------------------------- TOTAL INDUSTRIAL/OFFICE 2,381,914 - ----------------------------------------------------------------------------- MORTGAGE--15.7% COMMERCIAL FINANCING--7.5% Newcastle Investment Corp. ....................... 54,100 1,243,759 RAIT Investment Trust ............................ 2,500 57,400 Arbor Realty Trust, Inc. Units 144A(b)(c)(d)(f) .. 6,250 470,313 ----------- 1,771,472 ----------- HOME FINANCING--8.2% Novastar Financial, Inc. ......................... 6,300 362,061 Redwood Trust, Inc. .............................. 36,900 1,564,560 ----------- 1,926,621 ----------- - ----------------------------------------------------------------------------- TOTAL MORTGAGE 3,698,093 - ----------------------------------------------------------------------------- SHARES VALUE -------- ----------- RESIDENTIAL--22.8% APARTMENTS--19.4% Archstone-Smith Trust ............................ 27,546 $ 726,663 Avalonbay Communities, Inc. ...................... 14,850 694,980 Equity Residential ............................... 24,400 714,432 Essex Property Trust, Inc. ....................... 28,950 1,815,455 Post Properties, Inc. ............................ 22,900 623,567 ----------- 4,575,097 ----------- MANUFACTURED HOMES--3.4% Manufactured Home Communities, Inc. .............. 20,700 811,026 - ----------------------------------------------------------------------------- TOTAL RESIDENTIAL 5,386,123 - ----------------------------------------------------------------------------- RETAIL--7.1% REGIONAL MALLS--5.4% Simon Property Group, Inc. ....................... 29,115 1,268,832 SHOPPING CENTERS--1.7% Kimco Realty Corp. ............................... 10,000 409,700 - ----------------------------------------------------------------------------- TOTAL RETAIL 1,678,532 - ----------------------------------------------------------------------------- SPECIALTY--2.7% American Financial Realty Trust .................. 45,000 634,500 - ----------------------------------------------------------------------------- TOTAL REAL ESTATE INVESTMENT TRUSTS (IDENTIFIED COST $12,705,127) 15,750,740 - ----------------------------------------------------------------------------- REAL ESTATE OPERATING COMPANIES--1.8% DIVERSIFIED--1.8% Northstar Capital Investment Corp. 144A(b)(c)(d)(e) 35,000 420,000 - ----------------------------------------------------------------------------- TOTAL REAL ESTATE OPERATING COMPANIES (IDENTIFIED COST $720,625) 420,000 - ----------------------------------------------------------------------------- See Notes to Financial Statements 24 Phoenix-Seneca Real Estate Securities Fund SHARES VALUE -------- ----------- BUILDING PRODUCTS--3.8% Masco Corp. ...................................... 37,000 $ 905,760 (Identified cost $930,650) DIVERSIFIED COMMERCIAL SERVICES--0.3% Cendant Corp.(b) ................................. 4,100 76,629 (Identified cost $46,658) THRIFTS & MORTGAGE FINANCE--14.0% Fannie Mae ....................................... 20,000 1,404,000 Freddie Mac ...................................... 20,000 1,047,000 Washington Mutual, Inc. .......................... 21,500 846,455 ----------- (Identified cost $3,395,501) 3,297,455 ----------- - ----------------------------------------------------------------------------- TOTAL COMMON STOCKS (IDENTIFIED COST $17,798,561) 20,450,584 - ----------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--9.2% REAL ESTATE INVESTMENT TRUSTS--9.2% INDUSTRIAL/OFFICE--9.2% MIXED--4.2% Reckson Associates Realty Corp. Series A Cv. Pfd. 7.625% ........................................... 40,000 1,002,000 OFFICE--5.0% Glenborough Realty Trust, Inc. Series A Cv. Pfd. 7.75% ............................................ 49,150 1,178,125 - ----------------------------------------------------------------------------- TOTAL CONVERTIBLE PREFERRED STOCKS (IDENTIFIED COST $1,837,514) 2,180,125 - ----------------------------------------------------------------------------- TOTAL LONG TERM INVESTMENTS--95.8% (IDENTIFIED COST $19,636,075) 22,630,709 - ----------------------------------------------------------------------------- PAR VALUE (000) VALUE -------- ----------- SHORT-TERM OBLIGATIONS--9.5% REPURCHASE AGREEMENTS--9.5% State Street Bank & Trust Co. repurchase agreement, 0.25%, dated 9/30/03, due 10/1/03, repurchase price $2,245,016, collateralized by U.S. Treasury Note 3.625%, 3/31/04, market value $2,293,318 ................................. $2,245 $ 2,245,000 - ----------------------------------------------------------------------------- TOTAL SHORT-TERM OBLIGATIONS (IDENTIFIED COST $2,245,000) 2,245,000 - ----------------------------------------------------------------------------- TOTAL INVESTMENTS--105.3% (IDENTIFIED COST $21,881,075) 24,875,709(a) Other assets and liabilities, net--(5.3)% (1,248,274) ----------- NET ASSETS--100.0% $23,627,435 =========== (a) Federal Income Tax Information: Net unrealized appreciation of investment securities is comprised of gross appreciation of $3,973,070 and gross depreciation of $1,035,550 for federal income tax purposes. At September 30, 2003, the aggregate cost of securities for federal income tax purposes was $21,938,189. (b) Non income-producing. (c) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At September 30, 2003, these securities amounted to a value of $890,313 or 3.8% of net assets. For acquisition information, see Notes to Financial Statements. (d) Illiquid. At September 30, 2003, these securities amounted to a value of $890,313 or 3.8% of net assets. (e) Security valued at fair value as determined in good faith by or under the direction of the Trustees. At September 30, 2003, this security which is included in illiquid securities above, amounted to a value of $420,000 or 1.8% of net assets. (f) Units entitle holder to shares of stock and warrants. See Notes to Financial Statements 25 Phoenix-Seneca Real Estate Securities Fund STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 2003 ASSETS Investment securities at value, (Identified cost $21,881,075) $24,875,709 Cash 68 Receivables Dividends and interest 136,319 Fund shares sold 19,270 Prepaid expenses 514 ----------- Total assets 25,031,880 ----------- LIABILITIES Payables Investment securities purchased 1,145,375 Fund shares repurchased 177,576 Investment advisory fee 14,362 Transfer agent fee 12,595 Financial agent fee 4,285 Distribution and service fees 2,935 Trustees' fee 878 Accrued expenses 46,439 ----------- Total liabilities 1,404,445 ----------- NET ASSETS $23,627,435 =========== NET ASSETS CONSIST OF: Capital paid in on shares of beneficial interest $20,151,323 Accumulated net realized gain 481,478 Net unrealized appreciation 2,994,634 ----------- NET ASSETS $23,627,435 =========== CLASS X Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $17,753,559) 1,163,459 Net asset value and offering price per share $15.26 CLASS A Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $2,978,623) 200,130 Net asset value per share $14.88 Offering price per share $14.88/(1-5.75%) $15.79 CLASS B Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $1,117,329) 75,307 Net asset value and offering price per share $14.84 CLASS C Shares of beneficial interest outstanding, $1 par value, unlimited authorization (Net Assets $1,777,924) 119,751 Net asset value and offering price per share $14.85 STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 2003 INVESTMENT INCOME Dividends $ 815,444 Interest 4,394 ---------- Total investment income 819,838 ---------- EXPENSES Investment advisory fee 189,026 Service fees, Class A 6,311 Distribution and service fees, Class B 9,365 Distribution and service fees, Class C 13,523 Financial agent fee 52,477 Transfer agent 80,948 Professional 39,185 Registration 36,140 Printing 12,777 Trustees 11,086 Custodian 8,767 Miscellaneous 9,835 ---------- Total expenses 469,440 Less expenses borne by investment adviser (27,463) Custodian fees paid indirectly (33) ---------- Net expenses 441,944 ---------- NET INVESTMENT INCOME 377,894 ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized gain on securities 1,879,902 Net realized loss on written options (133,229) Net change in unrealized appreciation (depreciation) on investments 3,864,630 ---------- NET GAIN ON INVESTMENTS 5,611,303 ---------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $5,989,197 ========== See Notes to Financial Statements 26 Phoenix-Seneca Real Estate Securities Fund
STATEMENT OF CHANGES IN NET ASSETS Year Ended Year Ended 9/30/03 9/30/02 ----------- ----------- FROM OPERATIONS Net investment income (loss) $ 377,894 $ 812,174 Net realized gain (loss) 1,746,673 1,276,254 Net change in unrealized appreciation (depreciation) 3,864,630 (2,150,646) ----------- ----------- INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 5,989,197 (62,218) ----------- ----------- FROM DISTRIBUTIONS TO SHAREHOLDERS Net investment income, Class X (343,679) (799,965) Net investment income, Class A (22,710) (72,548) Net investment income, Class B (5,058) (16,495) Net investment income, Class C (6,447) (16,756) Net realized short-term gains, Class X (370,029) -- Net realized short-term gains, Class A (49,537) -- Net realized short-term gains, Class B (12,720) -- Net realized short-term gains, Class C (19,415) -- ----------- ----------- DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (829,595) (905,764) ----------- ----------- FROM SHARE TRANSACTIONS CLASS X Proceeds from sales of shares (35,379 and 410,208 shares, respectively) 465,027 5,303,637 Net asset value of shares issued from reinvestment of distributions (51,915 and 58,066 shares, respectively) 691,255 760,765 Cost of shares repurchased (380,751 and 386,311 shares, respectively) (5,045,694) (5,169,932) ----------- ----------- Total (3,889,412) 894,470 ----------- ----------- CLASS A Proceeds from sales of shares (216,922 and 177,962 shares, respectively) 2,701,734 2,296,733 Net asset value of shares issued from reinvestment of distributions (4,966 and 4,974 shares, respectively) 64,703 63,526 Cost of shares repurchased (235,156 and 165,182 shares, respectively) (2,852,530) (2,124,815) ----------- ----------- Total (86,093) 235,444 ----------- ----------- CLASS B Proceeds from sales of shares (75,743 and 51,904 shares, respectively) 1,076,762 674,381 Net asset value of shares issued from reinvestment of distributions (1,275 and 1,246 shares, respectively) 16,460 15,827 Cost of shares repurchased (85,797 and 14,145 shares, respectively) (1,178,515) (178,481) ----------- ----------- Total (85,293) 511,727 ----------- ----------- CLASS C Proceeds from sales of shares (50,351 and 75,376 shares, respectively) 665,381 978,001 Net asset value of shares issued from reinvestment of distributions (1,544 and 1,049 shares, respectively) 20,202 13,281 Cost of shares repurchased (32,144 and 19,160 shares, respectively) (418,176) (241,271) ----------- ----------- Total 267,407 750,011 ----------- ----------- INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (3,793,391) 2,391,652 ----------- ----------- NET INCREASE (DECREASE) IN NET ASSETS 1,366,211 1,423,670 NET ASSETS Beginning of period 22,261,224 20,837,554 ----------- ----------- END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $0 AND $0, RESPECTIVELY] $23,627,435 $22,261,224 =========== ===========
See Notes to Financial Statements 27 Phoenix-Seneca Real Estate Securities Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS X ---------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ---------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $12.07 $12.62 $11.89 $ 9.69 $11.11 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.27 0.49 0.42 0.34 0.47 Net realized and unrealized gain (loss) 3.46 (0.51) 0.69 2.35 (1.20) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 3.73 (0.02) 1.11 2.69 (0.73) ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.26) (0.53) (0.38) (0.49) (0.44) Distributions from net realized gains (0.28) -- -- -- (0.25) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.54) (0.53) (0.38) (0.49) (0.69) ------ ------ ------ ------ ------ Change in net asset value 3.19 (0.55) 0.73 2.20 (1.42) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $15.26 $12.07 $12.62 $11.89 $ 9.69 ====== ====== ====== ====== ====== Total return 31.60% (0.42)% 9.52% 29.00% (6.66)% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $17,754 $17,584 $17,349 $16,713 $17,346 RATIO TO AVERAGE NET ASSETS OF: Operating expenses 1.61%(6) 1.55 %(5) 1.59%(4) 1.79% 1.66 % Net investment income 2.06% 3.73 % 3.49% 3.35% 4.50 % Portfolio turnover 91% 111 % 40% 65% 5 % CLASS A ---------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ---------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $11.78 $12.32 $11.67 $ 9.54 $11.00 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) 0.11 0.32 0.25 0.21 0.32 Net realized and unrealized gain (loss) 3.36 (0.51) 0.67 2.30 (1.19) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 3.47 (0.19) 0.92 2.51 (0.87) ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.12) (0.35) (0.27) (0.38) (0.34) Distributions from net realized gains (0.25) -- -- -- (0.25) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.37) (0.35) (0.27) (0.38) (0.59) ------ ------ ------ ------ ------ Change in net asset value 3.10 (0.54) 0.65 2.13 (1.46) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $14.88 $11.78 $12.32 $11.67 $ 9.54 ====== ====== ====== ====== ====== Total return(2) 29.90% (1.73)% 7.96% 27.40% (7.97)% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $2,979 $2,515 $2,410 $1,437 $919 RATIO TO AVERAGE NET ASSETS OF: Operating expenses 2.92%(5) 2.83 %(5) 3.05%(3)(5) 3.05%(3) 3.05 %(3) Net investment income 0.89% 2.50 % 2.11% 2.11% 3.13 % Portfolio turnover 91% 111 % 40% 65% 5 % (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 3.18%, 4.28% and 4.27% for the periods ended September 30, 2001, 2000 and 1999, respectively. (4) For the year ended September 30, 2001, the ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would have been 1.60%. (5) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratios would not significantly differ. (6) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fee; if expense offsets were excluded, the ratio would have been 1.62%.
See Notes to Financial Statements 28 Phoenix-Seneca Real Estate Securities Fund
FINANCIAL HIGHLIGHTS (SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD) CLASS B ---------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ---------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $11.74 $12.28 $11.66 $ 9.55 $11.01 INCOME FROM INVESTMENT OPERATIONS: Net investment income (loss)(1) (0.01) 0.20 0.17 0.12 0.29 Net realized and unrealized gain (loss) 3.36 (0.50) 0.65 2.31 (1.22) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 3.35 (0.30) 0.82 2.43 (0.93) ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.07) (0.24) (0.20) (0.32) (0.28) Distributions from net realized gains (0.18) -- -- -- (0.25) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.25) (0.24) (0.20) (0.32) (0.53) ------ ------ ------ ------ ------ Change in net asset value 3.10 (0.54) 0.62 2.11 (1.46) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $14.84 $11.74 $12.28 $11.66 $ 9.55 ====== ====== ====== ====== ====== Total return(2) 28.82 % (2.63)% 7.21% 26.37% (8.59)% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $1,117 $987 $554 $287 $197 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(3) 3.80 %(6) 3.80 %(6) 3.80%(5) 3.80% 3.80 % Net investment income (0.09)% 1.59 % 1.43% 1.19% 2.79 % Portfolio turnover 91 % 111 % 40% 65% 5 % CLASS C ---------------------------------------------------------------- YEAR ENDED SEPTEMBER 30, ---------------------------------------------------------------- 2003 2002 2001 2000 1999 Net asset value, beginning of period $11.75 $12.28 $11.66 $ 9.55 $11.01 INCOME FROM INVESTMENT OPERATIONS Net investment income (loss)(1) (0.02) 0.21 0.16 0.14 0.29 Net realized and unrealized gain (loss) 3.37 (0.50) 0.66 2.29 (1.22) ------ ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS 3.35 (0.29) 0.82 2.43 (0.93) ------ ------ ------ ------ ------ LESS DISTRIBUTIONS: Dividends from net investment income (0.07) (0.24) (0.20) (0.32) (0.28) Distributions from net realized gains (0.18) -- -- -- (0.25) ------ ------ ------ ------ ------ TOTAL DISTRIBUTIONS (0.25) (0.24) (0.20) (0.32) (0.53) ------ ------ ------ ------ ------ Change in net asset value 3.10 (0.53) 0.62 2.11 (1.46) ------ ------ ------ ------ ------ NET ASSET VALUE, END OF PERIOD $14.85 $11.75 $12.28 $11.66 $ 9.55 ====== ====== ====== ====== ====== Total return(2) 28.80 % (2.47)% 7.12% 26.37% (8.58)% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (thousands) $1,778 $1,175 $525 $329 $200 RATIO TO AVERAGE NET ASSETS OF: Operating expenses(4) 3.80 %(6) 3.80 %(6) 3.80%(5) 3.80% 3.80 % Net investment income (0.18)% 1.63 % 1.38% 1.36% 2.80 % Portfolio turnover 91 % 111 % 40% 65% 5 % (1) Computed using average shares outstanding. (2) Maximum sales charge is not reflected in the total return calculation. (3) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 5.61%, 6.17%, 9.33%, 15.48% and 18.50% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (4) If the investment adviser had not waived fees and reimbursed expenses, the ratio of operating expenses to average net assets would have been 4.58%, 6.10%, 9.18%, 13.58% and 19.95% for the periods ended September 30, 2003, 2002, 2001, 2000 and 1999, respectively. (5) For the year ended September 30, 2001, the ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratio would have been 3.81%. (6) The ratio of operating expenses to average net assets includes the effect of expense offsets for custodian fees; if expense offsets were excluded, the ratios would not significantly differ.
See Notes to Financial Statements 29 PHOENIX-SENECA FUNDS NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2003 1. ORGANIZATION Phoenix-Seneca Funds (the "Trust") is organized as a Delaware business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. Currently, three Funds are offered for sale (each a "Fund"). The Bond Fund is diversified and has an investment objective of high total return from both current income and capital appreciation. The Mid-Cap "EDGE"SM Fund is diversified and has an investment objective of capital appreciation. The Real Estate Securities Fund is non-diversified and has an investment objective of high total return in both current income and long-term capital appreciation. Each Fund offers Class X, Class A, Class B and Class C shares. Class X shares are sold without a sales charge. Class A shares of Bond Fund are sold with a front-end sales charge of up to 4.75%. Class A shares of Mid-Cap "EDGE"SM Fund and Real Estate Securities Fund are sold with a front-end sales charge of up to 5.75%. Class B shares are sold with a contingent deferred sales charge which declines from 5% to zero depending on the period of time the shares are held. Class C shares are sold with a 1% contingent deferred sales charge if redeemed within one year of purchase. Each class of shares has identical voting, dividend, liquidation and other rights and the same terms and conditions, except that each class bears different distribution and/or service expenses and has exclusive voting rights with respect to its distribution plan. Class X bears no distribution and/or service expenses. Income and expenses and realized and unrealized gains and losses of each Fund are borne pro rata by the holders of each class of shares, except for transfer agent and registration expenses which are unique to each class. 2. SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosure of contingent assets and liabilities; revenues and expenses. Actual results could differ from those estimates. A. SECURITY VALUATION: Equity securities are valued at the official closing price (typically last sale) on the exchange on which the securities are primarily traded, or or if no closing price is available, at the last bid price. Debt securities are valued on the basis of broker quotations or valuations provided by a pricing service which utilizes information with respect to recent sales, market transactions in comparable securities, quotations from dealers and various relationships between securities in determining value. Short-term investments having a remaining maturity of 60 days or less are valued at amortized cost which approximates market. All other securities and assets are valued at fair value as determined in good faith by or under the direction of the Trustees. Certain securities held by the Bond Fund were valued on the basis of a price provided by a principal market maker. The prices provided by the principal market makers may differ from the value that would be realized if the securities were sold. At September 30, 2003, the total value of these securities represented approximately 7.33% of net assets. B. SECURITY TRANSACTIONS AND RELATED INCOME: Security transactions are recorded on the trade date. Dividend income is recorded on the ex-dividend date or, in the case of certain foreign securities, as soon as the Fund is notified. Interest income is recorded on the accrual basis. The Trust amortizes premiums and accretes discounts using the effective interest method. Realized gains and losses are determined on the identified cost basis. C. INCOME TAXES: Each Fund is treated as a separate taxable entity. It is the policy of each Fund to comply with the requirements of the Internal Revenue Code (the "Code") applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. In addition, each Fund intends to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Code. Therefore, no provision for federal income taxes or excise taxes has been made. D. DISTRIBUTIONS TO SHAREHOLDERS: Distributions are recorded by each Fund on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences may include the treatment of non-taxable dividends, market premium and discount, non-deductible expenses, expiring capital loss carryovers, foreign currency gain or loss, gain or loss on futures contracts, partnerships, operating losses and losses deferred due to wash sales. Permanent book and tax basis differences relating to shareholder distributions will result in reclassifications to paid in capital. E. FOREIGN CURRENCY TRANSLATION: Foreign securities and other assets and liabilities are valued using the foreign currency exchange rate effective at the end of the reporting period. Cost of investments is translated at the currency exchange rate effective at the trade date. The gain or loss resulting from a change in currency exchange rates between the trade and settlement dates of a portfolio transaction is treated as a gain or loss on foreign currency. Likewise, the gain or loss resulting from a change in currency exchange rates between the date income is accrued and paid is treated as a gain or loss on foreign currency. The Trust does not separate that portion of the results of operations arising from changes in exchange rates and that portion arising from changes in the market prices of securities. 30 PHOENIX-SENECA FUNDS NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2003 (CONTINUED) F. OPTIONS: Each Fund may write covered options or purchase options contracts for the purpose of hedging against changes in the market value of the underlying securities or foreign currencies. Each Fund will realize a gain or loss upon the expiration or closing of the option transaction. Gains and losses on written options are reported separately in the Statement of Operations. When a written option is exercised, the proceeds on sales or amounts paid are adjusted by the amount of premium received. Options written are reported as a liability in the Statement of Assets and Liabilities and subsequently marked-to-market to reflect the current value of the option. The risk associated with written options is that the change in value of options contracts may not correspond to the change in value of the hedged instruments. In addition, losses may arise from changes in the value of the underlying instruments, or if a liquid secondary market does not exist for the contracts. Each Fund may purchase options which are included in the Funds' Schedule of Investments and subsequently marked-to-market to reflect the current value of the option. When a purchased option is exercised, the cost of the security is adjusted by the amount of premium paid. The risk associated with purchased options is limited to the premium paid. At September 30, 2003, the Trust had no options outstanding. G. EXPENSES: Expenses incurred by the Trust with respect to more than one Fund are allocated in proportion to the net assets of each Fund, except where allocation of direct expense to each Fund or an alternative allocation method can be more fairly made. Fund expenses that are not related to the distribution of shares of a particular class or to services provided specifically to a particular class are allocated among the classes on the basis of relative average daily net assets of each class. Expenses that relate to the distribution of shares or services provided to a particular class are allocated to that class. H. REPURCHASE AGREEMENTS: A repurchase agreement is a transaction where a Fund acquires a security for cash and obtains a simultaneous commitment from the seller to repurchase the security at an agreed upon price and date. Each Fund, through its custodian, takes possession of securities collateralizing the repurchase agreement. The collateral is marked-to-market daily to ensure that the market value of the underlying assets remains sufficient to protect the Fund in the event of default by the seller. If the seller defaults and the value of the collateral declines, or if the seller enters insolvency proceedings, realization of collateral may be delayed or limited. I. WHEN-ISSUED AND DELAYED TRANSACTIONS: Each Fund may engage in when-issued or delayed delivery transactions. Each Fund records when-issued securities on the trade date and maintains collateral for the securities purchased. Securities purchased on when-issued or delayed delivery basis begin earning interest on the settlement date. 3. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS As compensation for its services to the Trust, the Adviser, Phoenix Investment Counsel, Inc., an indirect, wholly-owned subsidiary of The Phoenix Companies, Inc. ("PNX") is entitled to a fee based upon the following annual rates as a percentage of the average daily net assets of each Fund: Adviser Fee ------- Bond Fund ......................................................... 0.50% Mid-Cap "EDGE"SM Fund ............................................. 0.80% Real Estate Securities Fund ....................................... 0.85% The Adviser has voluntarily agreed to reimburse each Fund's operating expenses through January 31, 2004, to the extent that such expenses exceed the following percentages of average annual net assets: Class X Class A Class B Class C ------- ------- ------- ------- Bond Fund .............................. 0.90% 1.15% 1.90% 1.90% Mid-Cap "EDGE"SM Fund .................. 1.15% 1.40% 2.15% 2.15% Real Estate Securities Fund ............ 2.35% 3.05% 3.80% 3.80% Seneca Capital Management LLC ("Seneca") is the subadviser to each of the Funds. A majority of the equity interests of Seneca are owned by Phoenix Investment Partners, Ltd. ("PXP"), an indirect, wholly-owned subsidiary of PNX. The Adviser pays the subadviser a fee based upon the following annual rates as a percentage of the average daily net assets of each Fund: Bond Fund ............................................................... 0.25% Mid-Cap "EDGE"SM Fund ................................................... 0.40% Real Estate Securities Fund ............................................. 0.425% As Distributor of the Trust's shares, Phoenix Equity Planning Corporation ("PEPCO"), an indirect, wholly-owned subsidiary of PNX has advised the Trust that it retained net selling commissions and deferred sales charges for the period ended September 30, 2003, as follows: Class A Class B Class C Net Selling Deferred Deferred Commissions Sales Charges Sales Charges ----------- ------------- ------------- Bond Fund ......................... $7,279 $26,360 $1,986 Mid-Cap "EDGE"SM Fund ............. 8,410 84,505 6,924 Real Estate Securities Fund ....... 1,446 1,621 1,091 In addition to these amounts, the following was paid to W.S. Griffith Securities, Inc., an indirect subsidiary of PNX, for Class A net selling commissions: Bond Fund .............................................................. $2,856 Mid-Cap "EDGE"SM Fund .................................................. 6,084 Real Estate Securities Fund ............................................ 723 31 PHOENIX-SENECA FUNDS NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2003 (CONTINUED) In addition, each Fund pays PEPCO distribution and/or service fees at an annual rate of 0.25% for Class A shares, 1.00% for Class B shares and 1.00% for Class C shares applied to the average daily net assets of each respective class. The Distributor has advised the Trust that the total amount expensed for the period ended September 30, 2003 is as follows: Distribution Distribution Distribution and/or and/or Service and/or Service Service Fees Fees Paid to Fees Paid to Retained by Unaffiliated W.S. Griffith Distributor Participants Securities, Inc. ------------ -------------- ---------------- Bond Fund ....................... $109,870 $ 98,838 $3,953 Mid-Cap "EDGE"SM Fund ........... 385,022 324,428 5,301 Real Estate Securities Fund ..... 18,981 9,473 745 As Financial Agent of the Trust, PEPCO receives a financial agent fee equal to the sum of (1) the documented cost of fund accounting and related services provided by PFPC Inc. (subagent to PEPCO) plus (2) the documented cost to PEPCO to provide tax services and oversight of the subagent's performance. For the period ended September 30, 2003 financial agent fees were $269,318 as reported in the Statement of Operations of which PEPCO received $37,987 per Fund. Effective January 1, 2003, the fee schedule of PFPC Inc. ranges from 0.065% to 0.03% of the average daily net asset values of all the Phoenix funds serviced by PFPC Inc. Prior to that date, the fee schedule ranged from 0.085% to 0.0125%. Certain minimum fees may apply. PEPCO serves as the Trust's Transfer Agent with State Street Bank and Trust Company as sub-transfer agent. For the period ended September 30, 2003 transfer agent fees were $535,297 as reported in the Statement of Operations, of which PEPCO retained the following: Transfer Agent Fee Retained -------------- Bond Fund ..................................................... $ -- Mid-Cap "EDGE"SM Fund ......................................... 71,696 Real Estate Securities Fund ................................... -- At September 30, 2003, PNX and affiliates and the retirement plans of PNX and affiliates held Phoenix-Seneca Funds shares which aggregated the following: Aggregate Net Asset Shares Value -------- ---------- Bond Fund Class X .................................. 24,155 $ 260,391 Class A .................................. 220,907 2,359,287 Class B .................................. 12,497 131,219 Class C .................................. 12,476 131,248 Mid-Cap "EDGE"SM Fund Class B .................................. 7,389 102,485 Class C .................................. 7,390 102,573 Real Estate Securities Fund Class B .................................. 9,171 136,098 Class C .................................. 9,171 136,189 4. PURCHASE AND SALE OF SECURITIES Purchases and sales of securities during the period ended September 30, 2003 (excluding U.S. Government and agency securities, short-term securities and options) aggregated the following: Purchases Sales ------------ ------------ Bond Fund ...................................... $ 90,165,270 $ 79,310,307 Mid-Cap "EDGE"SM Fund .......................... 210,311,030 233,156,330 Real Estate Securities Fund .................... 18,937,252 23,170,183 Purchases and sales of long-term U.S. Government and agency securities during the period ended September 30, 2003, aggregated the following: Purchases Sales ------------ ------------ Bond Fund ...................................... $86,984,711 $108,208,037 Written call option activity for the period ended September 30, 2003 aggregated the following: Real Estate Securities Fund ----------------------------- Number of Amount of Options Premiums --------- ----------- Options outstanding at September 30, 2002 ...... $ -- $ -- Options written ................................ 4,638 716,345 Options expired ................................ (839) (59,849) Options closed ................................. (2,820) (445,406) Options exercised .............................. (979) (211,090) ------- --------- Options outstanding at September 30, 2003 ...... -- -- ======= ========= 5. CREDIT RISK AND ASSET CONCENTRATIONS In countries with limited or developing markets, investments may present greater risks than in more developed markets and the prices of such investments may be volatile. The consequences of political, social or economic changes in these markets may have disruptive effects on the market prices of these investments and the income they generate, as well as a fund's ability to repatriate such amounts. Certain funds invest a high percentage of their assets in specific sectors of the market in their pursuit of a greater investment return. Fluctuations in these sectors of concentration may have a greater impact to the fund, positive or negative, than if the fund did not concentrate its investments in such sectors. 6. OTHER As of September 30, 2003, certain Funds had a single shareholder and omnibus shareholder accounts (which are each comprised of several individual shareholders), which individually amounted to more 32 PHOENIX-SENECA FUNDS NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 2003 (CONTINUED) than 10% of the total shares outstanding as detailed below. The accounts are not affiliated with PNX. Number of % of Shares Accounts Outstanding ------------------ ------------ Mid-Cap "EDGE"SM Fund ...................... 2 Omnibus Accounts 25.9% Real Estate Securities Fund ................ 1 Account 49.7% 7. RESTRICTED SECURITIES Acquisition Date Acquisition Cost ---------------- ---------------- Arbor Realty Trust, Inc. Units ........... 6/26/03 $468,750 NorthStar Capital Investment Corp. Shares 20,000 ......................... 12/17/97 400,000 Shares 15,000 ......................... 3/24/98 320,625 The Real Estate Securities Fund will bear any costs, including those involved in registration under the Securities Act of 1933, in connection with the disposition of such securities. 8. FEDERAL INCOME TAX INFORMATION The Fund has capital loss carryovers which may be used to offset future capital gains, as follows: Expiration Year ------------------------------------ Fund 2009 2010 2011 Total - ---- -------- ----------- ----------- ----------- Mid-Cap "EDGE"SM Fund ..... $709,370 $42,302,856 $39,716,177 $82,728,403 The Fund may not realize the benefit of these losses to the extent it does not realize gains on investments prior to the expiration of the capital loss carryovers. For the period ended September 30, 2003, the following Funds utilized losses deferred in the prior year against current year capital gains as follows: Bond Fund .......................................................... $1,767,986 Real Estate Securities Fund ........................................ 727,379 Under current tax law, foreign currency and capital losses realized after October 31 may be deferred and treated as occurring on the first day of the following fiscal year. For the period ended September 30, 2003, the Bond Fund and the Mid-Cap "EDGE"SM Fund recognized $527,248 and $30,350,458, respectively of post-October capital losses. The components of distributable earnings on a tax basis (excluding unrealized appreciation (depreciation) which is disclosed in the Schedule of Investments) consist of undistributed ordinary income and undistributed long-term capital gains as follows: Undistributed Long-Term Ordinary Income Capital Gains --------------- ------------- Bond Fund .................................... $655,918 $ -- Mid-Cap "EDGE"SM Fund ........................ -- -- Real Estate Securities Fund .................. 163,486 375,110 The differences between the book and tax basis components of distributable earnings relate principally to the timing of recognition of income and gains for federal income tax purposes. Short-term gain distributions reported in the Statement of Changes in Net Assets, if any, are reported as ordinary income for federal tax purposes. 9. RECLASSIFICATION OF CAPITAL ACCOUNTS For financial reporting purposes, book basis capital accounts are adjusted to reflect the tax character of permanent book/tax differences. Permanent reclassifications can arise from differing treatment of certain income and gain transactions, nondeductible current year net operating losses, expiring capital loss carryovers and investments in passive foreign investment companies. The reclassifications have no impact on the net assets or net asset values of the Fund. As of September 30, 2003, the following Funds recorded reclassifications to increase (decrease) the accounts listed below: Capital Paid in on Shares Undistributed Accumulated of Beneficial Net Investment Net Realized Interest Income (Loss) Gain (Loss) ------------- -------------- ------------ Bond Fund .................... $ 2 $ (2) $-- Mid-Cap "EDGE"SM Fund ........ (1,740,405) 1,740,406 (1) 10. SUBSEQUENT EVENT Effective December 3, 2003, Phoenix-Seneca Real Estate Securities Fund will change its name to Phoenix-Seneca Equity Income Fund. The Board of Trustees of the Phoenix-Seneca Funds has approved this name change to coincide with a modification of this Fund's non-fundamental investment strategies. - -------------------------------------------------------------------------------- TAX INFORMATION NOTICE (UNAUDITED) For Federal income tax purposes, 15% of the current year net income earned dividends paid by the Real Estate Securities Fund will qualify for the dividends received deduction for corporate shareholders when paid. Effective for the calendar year 2003, qualified dividends will be taxed at a lower rate for individual shareholders. 12% of the ordinary income dividends distributed by the Real Estate Securities Fund and applicable to qualifying dividends received after January 1, 2003, will qualify for the lower tax rate. This Fund plans to designate the maximum amount allowable under the Jobs and Growth Tax Relief Reconciliation Act. The actual percentage for the calendar year will be designated in the year-end tax statements. For the fiscal year ended September 30, 2003, the Real Estate Securities Fund designated $375,110 of long-term capital gains dividends. - -------------------------------------------------------------------------------- 33 REPORT OF INDEPENDENT AUDITORS (LOGO) PRICEWATERHOUSECOOPERS [GRAPHIC OMITTED] To the Board of Trustees and Shareholders of Phoenix-Seneca Funds: In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Phoenix-Seneca Bond Fund, Phoenix-Seneca Mid Cap "EDGE" Fund, and Phoenix-Seneca Real Estate Securities Fund (constituting the Phoenix-Seneca Funds, hereafter referred to as the "Fund") at September 30, 2003, the results of each of their operations, the changes in each of their net assets and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit 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, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at September 30, 2003, by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. /s/ PRICEWATERHOUSECOOPERS Boston, Massachusetts November 14, 2003 34
FUND MANAGEMENT Information pertaining to the Trustees and officers of the Trust is set forth below. The statement of additional information (SAI) includes additional information about the Trustees and is available without charge, upon request, by calling (800) 243-4361. The address of each individual, unless otherwise noted, is 56 Prospect Street, Hartford, CT 06115-0480. There is no stated term of office for Trustees of the Trust. INDEPENDENT TRUSTEES - ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF PORTFOLIOS IN FUND COMPLEX PRINCIPAL OCCUPATION(S) NAME, ADDRESS AND LENGTH OF OVERSEEN BY DURING PAST 5 YEARS AND DATE OF BIRTH TIME SERVED TRUSTEE OTHER DIRECTORSHIPS HELD BY TRUSTEE - ------------------------------------------------------------------------------------------------------------------------------------ E. Virgil Conway Served since 35 Chairman, Rittenhouse Advisors, LLC (consulting firm) since 2001. Rittenhouse Advisors, LLC 2000. Trustee/Director, Realty Foundation of New York (1972-present), Pace 101 Park Avenue University (1978-present), New York Housing Partnership Development New York, NY 10178 Corp. (Chairman) (1981-present), Greater New York Councils, Boy Scouts DOB: 8/2/29 of America (1985- present), The Academy of Political Science (Vice Chairman) (1985-present), Urstadt Biddle Property Corp. (1989-present), The Harlem Youth Development Foundation (1998-2002). Chairman, Metropolitan Transportation Authority (1992-2001). Director, Trism, Inc. (1994-2001), Consolidated Edison Company of New York, Inc. (1970-2002), Atlantic Mutual Insurance Company (1974-2002), Centennial Insurance Company (1974-2002), Josiah Macy, Jr., Foundation (1975-present), Union Pacific Corp. (1978-2002), BlackRock Freddie Mac Mortgage Securities Fund (Advisory Director) (1990-2000), Accuhealth (1994-2002). - ------------------------------------------------------------------------------------------------------------------------------------ Harry Dalzell-Payne Served since 35 Currently retired. The Flat, Elmore Court 1999. Elmore, GL05, GL2 3NT U.K. DOB: 8/9/29 - ------------------------------------------------------------------------------------------------------------------------------------ Geraldine M. McNamara Served since 35 Managing Director, U.S. Trust Company of New York (private bank) U.S. Trust Company of 2001. (1982-present). New York 11 West 54th Street New York, NY 10019 DOB: 4/17/51 - ------------------------------------------------------------------------------------------------------------------------------------ Everett L. Morris Served since 35 Currently retired, Vice President, W.H. Reaves and Company (investment 164 Laird Road 2000. management) (1993-2003). Colts Neck, NJ 07722 DOB: 5/26/28 - ------------------------------------------------------------------------------------------------------------------------------------
35 FUND MANAGEMENT (CONTINUED)
INTERESTED TRUSTEES Each of the individuals listed below is an "interested person" of the Trust, as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended, and the rules and regulations thereunder. - ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF NAME, ADDRESS, PORTFOLIOS IN DATE OF BIRTH FUND COMPLEX PRINCIPAL OCCUPATION(S) AND POSITION(S) WITH LENGTH OF OVERSEEN BY DURING PAST 5 YEARS AND TRUST TIME SERVED TRUSTEE OTHER DIRECTORSHIPS HELD BY TRUSTEE - ------------------------------------------------------------------------------------------------------------------------------------ *Philip R. McLoughlin Served since 45 Consultant, Phoenix Investment Partners Ltd. (2002-present). Director, DOB: 10/23/46 2000. PXRE Corporation (Delaware) (1985-present), World Trust Fund (1991-present). Chairman (1997-2002), Director (1995-2002), Vice Chairman Chairman (1995-1997) and Chief Executive Officer (1995-2002), Phoenix Investment Partners, Ltd. Director and Executive Vice President, The Phoenix Companies, Inc. (2000-2002). Director (1994-2002) and Executive Vice President, Investments (1987-2002), Phoenix Life Insurance Company. Director (1983-2002) and Chairman (1995-2002), Phoenix Investment Counsel, Inc. Director (1982-2002) and President (1990-2000), Phoenix Equity Planning Corporation. Chairman and President, Phoenix/Zweig Advisers LLC (2001-2002). Director (2001-2002) and President (April 2002-September 2002), Phoenix Investment Management Company. Director and Executive Vice President, Phoenix Life and Annuity Company (1996-2002). Director (1995-2000) and Executive Vice President (1994-2002), PHL Variable Insurance Company. Director, Phoenix National Trust Holding Company (2001-2002). Director (1985-2002) and Vice President (1986-2002), PM Holdings, Inc. Director, W.S. Griffith Associates, Inc. (1995-2002). Director (1992-2002) and President (1993-1994), W.S. Griffith Securities, Inc. - ------------------------------------------------------------------------------------------------------------------------------------ * Mr. McLoughlin is an "interested person," as defined in the Investment Company Act of 1940, by reason of his relationship with Phoenix Investment Partners, Ltd. and its affiliates.
36 FUND MANAGEMENT (CONTINUED)
OFFICERS OF THE TRUST WHO ARE NOT TRUSTEES - ------------------------------------------------------------------------------------------------------------------------------------ POSITION(S) HELD WITH NAME, ADDRESS AND TRUST AND LENGTH OF PRINCIPAL OCCUPATION(S) DATE OF BIRTH TIME SERVED DURING PAST 5 YEARS - ------------------------------------------------------------------------------------------------------------------------------------ Gail P. Seneca President since 1996. President and Chief Executive and Investment Officer, Seneca Capital 909 Montgomery Street Management LLC (1996-present). Managing Director, Equities, Phoenix San Francisco, CA 94133 Investment Counsel, Inc. (1998-present). Managing General Partner and DOB: 3/7/53 Chief Executive and Investment Officer, GMG/Seneca Capital Management LP (1989-present). President, GenCap, Inc. (1994-present). Trustee, Phoenix-Seneca Funds (1996-2000). - ------------------------------------------------------------------------------------------------------------------------------------ William R. Moyer Executive Vice President Senior Vice President (1995-1999), Chief Financial Officer DOB: 8/16/44 since 2000. (1995-present), and Executive Vice President (1999-present), Phoenix Investment Partners, Ltd. Director (1998-present), Executive Vice President, Chief Financial Officer and Treasurer (2000-present), Senior Vice President and Chief Financial Officer (1996-2000), Phoenix Equity Planning Corporation. Director (1998-present), Senior Vice President, Chief Financial Officer and Treasurer (1996-present), Phoenix Investment Counsel, Inc. Director (2000-present), Treasurer (1996- present), Senior Vice President (2000-2002), Executive Vice President (2000-present). Duff & Phelps Investment Management Co. Executive Vice President, Phoenix Fund Complex (1990-present). - ------------------------------------------------------------------------------------------------------------------------------------ John F. Sharry Executive Vice President Executive Vice President (1998-present), Phoenix Investment Partners, DOB: 3/28/52 since 2002. Ltd. President, Phoenix Equity Planning Corporation (2000-present). Executive Vice President, Phoenix Fund Complex (1998-present). - ------------------------------------------------------------------------------------------------------------------------------------ Robert S. Driessen Vice President since 1999. Vice President and Compliance Officer, Phoenix Investment Partners, One American Row Ltd. (1999-present). Vice President and Compliance Officer, Phoenix Hartford, CT 06102 Investment Counsel, Inc. (1999-present). Vice President DOB: 10/12/47 (1999-present). Anti-Money Laundering Officer and Assistant Secretary (2002-present) Phoenix Fund Complex. Vice President, Chief Compliance Officer and Secretary (2000- present) and Designated Money Laundering Compliance Officer (2002-present) PXP Securities Corp. Vice President, Compliance and Assistant Secretary (2002-present), PXP Institutional Markets Group, Ltd. Vice President, Compliance (2000-present), Designated Money Laundering Compliance Officer (2002-present), Phoenix Equity Planning Corporation. Vice President, Risk Management Liaison, Bank of America (1996-1999). - ------------------------------------------------------------------------------------------------------------------------------------ Nancy G. Curtiss Treasurer since 2000. Vice President, Fund Accounting (1994-2000), Treasurer (1996-2000), DOB: 11/24/52 Assistant Treasurer (2001-present), Phoenix Equity Planning Corporation. Treasurer, Phoenix Fund Complex (1994-present). - ------------------------------------------------------------------------------------------------------------------------------------ Richard J. Wirth Secretary since 2002. Vice President and Insurance and Investment Products Counsel One American Row (2002-present), Counsel (1993-2002), Phoenix Life Insurance Company. Hartford, CT 06102 Director (2003-present), President (2003-present), Assistant Secretary DOB: 11/14/58 (2002-present), Phoenix Variable Advisors, Inc. Secretary (2002-present), Chief Legal Officer (2003-present), Phoenix Fund Complex. - ------------------------------------------------------------------------------------------------------------------------------------
37 PHOENIX-SENECA FUNDS 909 Montgomery Street San Francisco, California 94133 TRUSTEES E. Virgil Conway Harry Dalzell-Payne Philip R. McLoughlin Geraldine M. McNamara Everett L. Morris OFFICERS Gail P. Seneca, President William R. Moyer, Executive Vice President John F. Sharry, Executive Vice President Robert S. Driessen, Vice President Nancy G. Curtiss, Treasurer Richard J. Wirth, Secretary INVESTMENT ADVISER Phoenix Investment Counsel, Inc. 56 Prospect Street Hartford, Connecticut 06115-0480 SUBADVISER Seneca Capital Management LLC 909 Montgomery Street San Francisco, California 94133 PRINCIPAL UNDERWRITER Phoenix Equity Planning Corporation 56 Prospect Street Hartford, Connecticut 06115-0480 CUSTODIAN State Street Bank and Trust Company P.O. Box 5501 Boston, Massachusetts 02206-5501 TRANSFER AGENT Phoenix Equity Planning Corporation 56 Prospect Street Hartford, Connecticut 06115-0480 INDEPENDENT AUDITORS PricewaterhouseCoopers LLP 125 High Street Boston, Massachusetts 02110 HOW TO CONTACT US Mutual Fund Services 1-800-243-1574 Advisor Consulting Group 1-800-243-4361 Text Telephone 1-800-243-1926 Web site PHOENIXINVESTMENTS.COM - -------------------------------------------------------------------------------- IMPORTANT NOTICE TO SHAREHOLDERS The Securities and Exchange Commission has modified mailing regulations for semiannual and annual shareholder fund reports to allow mutual fund companies to send a single copy of these reports to shareholders who share the same mailing address. If you would like additional copies, please call Mutual Fund Services at 1-800-243-1574. - -------------------------------------------------------------------------------- (This page has been left blank intentionally.) (This page has been left blank intentionally.) --------------- PRESORTED STANDARD U.S. POSTAGE PAID Louisville, KY Permit No. 1051 --------------- PHOENIX EQUITY PLANNING CORPORATION P.O. Box 150480 Hartford, CT 06115-0480 (LOGO) PHOENIX INVESTMENT PARTNERS, LTD. A MEMBER OF THE PHOENIX COMPANIES, INC. [GRAPHIC OMITTED] For more information about Phoenix mutual funds, please call your financial representative or contact us at 1-800-243-4361 or PHOENIXINVESTMENTS.COM. PXP 1140 (11/03) ITEM 2. CODE OF ETHICS. (a) The registrant, as of the end of the period covered by this report, 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, regardless of whether these individuals are employed by the registrant or a third party. (b) There have been no amendments, during the period covered by this report, to a provision of the 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, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics description. (c) The registrant has not granted any waivers, including an implicit waiver, from a provision of the 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, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more of the items set forth in paragraph (b) of this item's instructions. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. (a) As of the end of the period covered by the report, the Board of Trustees of the Fund has determined that E. Virgil Conway and Everett L. Morris possess the technical attributes identified in Instruction 2(b) of Item 3 to Form N-CSR to qualify as an "audit committee financial expert". Mr. Conway and Mr. Morris are "independent" trustees pursuant to paragraph (a) (2) of Item 3 to form N-CSR. 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. [RESERVED] ITEM 9. CONTROLS AND PROCEDURES. (a) The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)). (b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant's last fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 10. EXHIBITS. (a)(1) Code of ethics, or any amendment thereto, that is the subject of disclosure required by Item 2 is attached hereto. (a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. (b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (registrant) Phoenix-Seneca Funds -------------------------------------------------------------------- By (Signature and Title)* /S/PHILIP R. MCLOUGHLIN ------------------------------------------------------- Philip R. McLoughlin, Chairman (principal executive officer) Date ---------------------------------------------------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title)* /S/PHILIP R. MCLOUGHLIN ------------------------------------------------------- Philip R. McLoughlin, Chairman (principal executive officer) Date December 5, 2003 ---------------------------------------------------------------------------- By (Signature and Title)* /S/NANCY G. CURTISS ------------------------------------------------------- Nancy G. Curtiss, Treasurer (principal financial officer) Date December 5, 2003 ---------------------------------------------------------------------------- * Print the name and title of each signing officer under his or her signature. EX-99.P 3 g8386_codeeth.txt SENECA CODE OF ETHICS EX-99.CODE ETH THE "CODE" - ---------- THE CODE OF ETHICS APPLIES TO THE PRINCIPAL EXECUTIVE, FINANCIAL AND ACCOUNTING OFFICERS OF THE PHOENIX COMPANIES, INC. ("PNX"). IT CONSTITUTES THE MAIN PART OF THE PHOENIX CODE OF CONDUCT, WHICH HAS APPLIED TO ALL EMPLOYEES OF PNX AND ITS SUBSIDIARIES FOR MANY YEARS. WE PLAN TO CONTINUE TO REVISE BOTH CODES FROM TIME TO TIME AS NEEDED TO KEEP THEM VIABLE, RELEVANT AND IN COMPLIANCE WITH ALL APPLICABLE LEGISLATIVE AND REGULATORY REQUIREMENTS. COMMITMENT TO SHAREHOLDERS - -------------------------- PHOENIX IS COMMITTED TO PROVIDING SHAREHOLDER VALUE. ONE WAY WE DO THIS IS BY OBSERVING THE HIGHEST STANDARDS OF LEGAL AND ETHICAL CONDUCT IN ALL OF OUR BUSINESS DEALINGS. CONFLICTS OF INTEREST Phoenix expects every employee, officer and director to maintain the highest moral and ethical standards and to avoid conflicts of interest in conducting business activities. A "conflict of interest" occurs when an individual's private interest interferes, or even appears to interfere, in any way with the interests of the corporation as a whole. A conflict situation can arise when an employee, officer or director takes actions or has interests that may make it difficult to perform his or her work for the Company objectively and effectively. Conflicts of interest also arise when an employee, officer or director, or a member of his or her family, receives improper personal benefits as a result of his or her position in the Company. Employees requested to serve on the Board of Directors of another company by Phoenix owe a fiduciary duty to Phoenix as well as to the company on whose Board of Directors he or she serves. Where conflicts of interest arise between the interests of Phoenix and the other company, the employee should consult Phoenix's General Counsel for guidance. Moreover, no employee requested to serve on the Board of Directors of another company shall accept fees or other compensation for Board service. In the event the company for which an employee serves as a director requires directors to receive fees, any remuneration received by the employee shall be donated to a charitable organization. The Company will offset any tax consequences incurred by the employee. All conflicts of interest must be disclosed in writing to the Chief Compliance Officer. Employees, officers and directors are required to file a Conflict of Interest Statement annually. Any conflicts of interest that arise following completion of the Conflict of Interest Statement must be promptly reported to the Chief Compliance Officer in writing. CORPORATE OPPORTUNITIES Employees, officers and directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises. Consequently, employees, officers and directors are prohibited from engaging in the following activities: o Taking for themselves personal opportunities that are discovered through the use of corporate property, information or position; o Using Company property, information or position for personal gain; and o Competing with the Company. INSIDER TRADING AND PERSONAL TRADING Federal securities laws and Company policy prohibit the purchase or sale of securities while in possession of material non-public information and prohibit passing such information on to others. No employee, officer or director may buy or sell Phoenix securities if he or she has material non-public information. This restriction also applies to an employee's spouse, other adults living in the employee's household, and minor children. Employees and their family members also must avoid passing non-public information on to third parties. Information is "material" if a reasonable investor would probably consider the information important in deciding whether to buy, hold or sell securities of the company to which the information relates. Officers are subject to certain restrictions under New York Insurance Law governing ownership of Phoenix stock. Officers and their family members are prohibited from purchasing shares of Phoenix stock for a period of two years from the date of demutualization. All employees with a title of Vice President or higher, plus certain other employees whose positions place them in regular contact with non-public information, are subject to a further restriction as well. These employees may only buy or sell Phoenix securities during "window" periods. No employee, officer or director may buy or sell securities of another company with the knowledge that those securities are being considered for purchase or sale by Phoenix, any of its subsidiaries or any advisory accounts. In the case of any company in which Phoenix owns 10 percent or more of the outstanding equity, no employee (or family member) may make any personal investment without prior approval from the Law Department. Certain employees who are involved with the Company's investment adviser and broker-dealer operations may be required to secure preclearance of and/or report all personal securities transactions. In addition, Phoenix reserves the right to require duplicate confirmations, quarterly transaction reports and prior clearance for any personal securities transactions. If you have any question whether your position requires preclearance or reporting, you should contact the compliance officer for your business area (investment adviser or broker-dealer) or the Corporate Compliance Department. CONFIDENTIALITY Employees are required to maintain the confidentiality of information entrusted to them by the Company or its customers. Disclosure of confidential information is restricted to authorized persons or in situations in which disclosure is legally mandated. Confidential information includes all non-public information that may or may not be of use to competitors, or harmful to the Company or its customers if disclosed, including, but not limited to: internal operating procedures; investment strategies; sales data and customer lists; financial plans; projections; and reports. An employee's obligation to protect confidential information continues even after termination of his or her employment. PROTECTION AND USE OF COMPANY PROPERTY AND ASSETS Employees are given access to Company property to assist them in effectively carrying out their duties to the Company. Company property should only be used for legitimate purposes. All employees should protect the Company's property and ensure its efficient use. Theft, fraud, carelessness and waste have a direct impact on the Company's profitability. Examples of Company property include proprietary and non-public information, equipment, facilities, vehicles, funds and other assets. Improper use or abuse of Company property is prohibited. Expenses to be paid for by the Company, via reimbursement or direct payment, are limited to those expenses that are authorized and related to legitimate business activities. CORPORATE DISCLOSURES As a public company, Phoenix is required to publicly disclose certain information on a regular basis. This includes financial information and other material information about The Phoenix Companies, Inc. It is imperative that such information is disseminated in a consistent manner and in accordance with SEC disclosure requirements and Company policy. In order to ensure that information released is accurate and properly disseminated, only certain individuals are authorized to speak on behalf of the Company. Employees are prohibited from speaking with rating agencies, analysts, investors or the press without obtaining prior authorization from the President and Chief Executive Officer. Employees receiving any such inquiries should refer such individuals to the appropriate area for response: o Press and News Media - All inquiries must be referred to the Senior Vice President, Corporate Communications. o Rating Agencies - All inquiries must be referred to the Chief Financial Officer. o Securities Analysts and Investors - All inquiries must be referred to the Vice President, Investor Relations or the Chief Financial Officer. Employees are prohibited from disclosing any non-public information about the Company's financial performance or commenting on the Company's stock performance. ACCURACY AND RETENTION OF COMPANY RECORDS The integrity of Phoenix's records is vital to the Company's continued success. The altering, falsification or misuse of Company documents is strictly prohibited. Phoenix's business transactions must be accurately recorded on the Company's books and records in accordance with generally accepted accounting principles, any other required accounting basis and established Company policy. Financial information must fairly represent all relevant information. The retention and destruction of Company records shall be in accordance with established Company policies and applicable legal and regulatory requirements. COMMITMENT TO CLIENTS - --------------------- Phoenix upholds its commitment to our clients by conducting our business fairly and honestly, and maintaining the highest ethical standards in all dealings with customers. SAFEGUARDING CUSTOMER ASSETS Employees have an obligation to safeguard the assets of our customers at all times, and to protect them from all forms of misuse. Misappropriation of funds can include theft, fraud, embezzlement or unauthorized borrowing. Employees must not, under any circumstances, misappropriate funds, property or other assets, or assist another individual in doing so. ETHICAL MARKET CONDUCT The Company expects all who are involved in the sales and marketing of its products and services to abide by the following principles: o Conduct business according to high standards of honesty and fairness; o Provide competent and customer-focused sales and service; o Engage in active and fair competition; o Provide clear, honest and fair advertising and sales materials; o Handle customer complaints and disputes in an appropriate and timely manner; and o Monitor sales and service procedures to help ensure compliance with ethical market conduct. PRIVACY AND CONFIDENTIAL PERSONAL INFORMATION It is the responsibility of every employee to maintain the privacy of confidential personal information. Confidential personal information includes non-public financial and health information obtained from consumers and customers in connection with providing a financial product or service. Specific examples of confidential personal information include information concerning assets, income, businesses, estates, financial plans and health. The misuse of confidential personal information could subject Phoenix and its employees to civil liability or criminal penalties. Before releasing confidential information to anyone, employees must make certain that releasing it is permitted under Phoenix's policies or authorized in writing by the person to whom it relates. CUSTOMER COMPLAINTS The Company is committed to fairly and expeditiously handling all customer complaints. All complaints must be handled and reported in accordance with established corporate policies as well as procedures established for the applicable business unit or affiliate. Maintaining centralized records serves not only regulatory authorities with oversight of the Companies, but also provides Phoenix and its affiliates with information to consider areas where changes or improvements are needed. FRAUD The Company strongly supports all efforts to detect and prevent fraud. It believes that only through aggressive action to combat fraud can the Company continue to meet its fundamental obligations to its stockholders and customers. When there is reason to believe that Phoenix has been the target of fraud or attempted fraud, it will aggressively work with the appropriate law enforcement officials to seek prosecution and conviction of the responsible individual(s). Any employee who is aware of or suspects fraud must report it to the Corporate Audit Department immediately. INSURANCE ANTI-FRAUD PLAN In accordance with insurance regulatory requirements, Phoenix has a comprehensive insurance anti-fraud plan that is designed to: o Prevent insurance fraud, including: internal fraud involving the Company's officers, employees or agents, fraud resulting from misrepresentations on applications for insurance, and claims fraud; o Report insurance fraud to appropriate law enforcement and regulatory authorities; o Encourage cooperation in the prosecution of insurance fraud cases; and o Aggressively pursue recovery of all sums improperly paid by the Company as a result of fraud. COMMITMENT TO CORPORATE CITIZENSHIP - ----------------------------------- Phoenix is committed to being a responsible corporate citizen, which includes compliance with applicable laws and regulations of the jurisdictions in which we operate as well as engaging in fair competition in the marketplace. COMPLYING WITH LEGAL AND REGULATORY REQUIREMENTS The Company expects all employees to conduct business in accordance with all applicable laws and regulations. The laws and regulations related to the financial services industry are complex, thus placing a duty on each employee to take all reasonable steps to ensure his or her actions are in compliance. Compliance with the law does not comprise our entire ethical responsibility. Rather, it is a minimum standard for performance of our duties. ACCOUNTING, INTERNAL ACCOUNTING CONTROLS OR AUDITING MATTERS The Company treats complaints about accounting, internal accounting controls, or auditing matters seriously and expeditiously. Employees will be given the opportunity to submit confidential and anonymous complaints about accounting or auditing matters for review by representatives of Phoenix, and if appropriate, the Audit Committee of the Board of Directors. These complaints will be handled in a manner that protects the confidentiality and anonymity of the employee when so requested by the employee. No employee will be terminated or otherwise retaliated against for submitting a complaint under this procedure if the employee reasonably believes that the complaint involves a violation of federal securities or anti-fraud laws. FAIR DEALING Each employee must deal fairly with the Company's customers, suppliers, competitors and employees. No employee shall take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or other unfair-dealing practice. ANTITRUST Phoenix is committed to preserving a free and competitive marketplace and will not engage in any understandings or agreements with any competitor that could result in a restraint of trade. Employees must avoid engaging in any conduct that violates the antitrust laws, such as agreements with competitors regarding prices, terms of sale, division of markets and allocations of customers. Discussions with competitors related to market share, projected sales for any specific product or service, revenues and expenses, production schedules, unannounced products and services, pricing or marketing strategies are prohibited. The antitrust laws also apply to informal contacts with competitors, such as trade shows or meetings of professional organizations. Every employee has an obligation to avoid situations that could result in a violation of the antitrust laws. Any questions concerning the legality or appropriateness of specific acts should be directed to the Law Department. ANTI-MONEY LAUNDERING It is the responsibility of every employee to protect the Company from exploitation by individuals engaged in money laundering activities. Accordingly, each employee must undertake the following: o Become familiar with the anti-money laundering laws and their requirements as applied to the Company; and o Learn and fully comply with the Company's anti-money laundering policies and procedures. Failure to comply with applicable laws or the Company's policies may result in significant criminal and civil penalties to the Company as well as those individuals involved. Furthermore, association with any money laundering activity subjects both the Company and its employees to civil and criminal penalties. LOBBYING AND POLITICAL CONTRIBUTIONS Lobbying is generally defined as communicating with a public official, or a member of his or her staff, in the legislative or executive branch of government, for the purpose of influencing legislative or administrative action. Lobbying is highly regulated and lobbyists are required to be registered and to report their activities. No employee may engage in lobbying on behalf of Phoenix without prior permission of the Law Department. The giving of gifts to local public officials and members of their staff, whether in the form of meals, tickets to events or otherwise, is strictly regulated by most states and by the federal government. Employees must be careful to distinguish between personal and corporate political activities. Unless specifically requested by the Company to communicate on its behalf on a particular issue, you should identify communications with legislators as expressing your own personal beliefs and not those of Phoenix. The use of Phoenix stationery for any personal political communication is prohibited. Any employee wishing to be a candidate for elective office should consult with his or her supervisor and department head in advance. Questions regarding the Company's position on proposed legislation or regulation should be referred to Government Relations or the Law Department. FOREIGN CORRUPT PRACTICES ACT The Foreign Corrupt Practices Act prohibits the payment or authorization of the payment of any money, or the giving of value, directly or indirectly, to a foreign official for the purpose of: o Influencing any act or decision of the foreign official; or o Inducing the foreign official to use his influence to assist in obtaining business for or directing business to any person. A "foreign official" is any person acting in an official capacity on behalf of a foreign government, agency, department or instrumentality. Also included under the term "foreign official" are foreign political parties, officials of political parties and candidates for foreign political office. The Foreign Corrupt Practices Act applies to all officers, directors, employees and agents of the Company. Violation of the act can result in both fines and imprisonment. COPYRIGHTS, TRADEMARKS AND PATENTS Employees must avoid infringing upon the intellectual property rights of others. Intellectual property includes copyrights, trademarks, service marks, patents and trade secrets. Improper use includes copying, distributing or modifying third party copyrighted materials without permission. Infringement may result in criminal as well as civil liabilities for Phoenix and its employees. The Company has an agreement with the Copyright Clearance Center that gives a license to Phoenix employees to make photocopies of many publications for business purposes. Contact the Corporate Compliance Department with any questions about the types of copying that are covered by the agreement. COMMITMENT TO EMPLOYEES - ----------------------- PHOENIX'S EMPLOYEES ARE OUR MOST IMPORTANT ASSET AND WE ARE COMMITTED TO FOSTERING A WORK ENVIRONMENT IN WHICH EMPLOYEES HAVE THE OPPORTUNITY TO GROW, CONTRIBUTE AND PARTICIPATE FREE FROM DISCRIMINATION. EQUAL OPPORTUNITY Phoenix employs and promotes on the basis of merit and achievement without regard to age, race, gender, color, religion, national origin, ancestry, sexual orientation, marital status, or disability. This policy applies to every phase of the employment process and every aspect of the employment relationship: recruitment, hiring, training, promotions, transfers, terminations, benefits, compensation and participation in Company-sponsored educational, social and recreational programs. SEXUAL HARASSMENT Phoenix prohibits sexual harassment in the workplace. Sexual harassment includes unwelcome sexual advances, requests for sexual favors and other verbal, visual or physical conduct when: o Submission is made either explicitly or implicitly a term or condition of a person's employment; o Submission to or rejection of inappropriate conduct by an employee is used as the basis for employment decisions affecting the employee; or o The conduct has the purpose or effect of unreasonably interfering with an individual's work performance or creating an intimidating, hostile or offensive working environment. Sexual harassment also includes unwelcome sexual flirtations and advances; verbal abuse of a sexual nature; inappropriate touching; graphic or verbal comments about an individual's body; displaying in the workplace a sexually suggestive object or picture; and sexually explicit or offensive jokes. EMPLOYMENT OF RELATIVES The employment of relatives of any director or officer, or any employee working in the Human Resources Department, Corporate Audit Department or Corporate Compliance Department is prohibited. If a situation arises in which relatives are employed by the company and one or both of them later become officers or employees in the departments specified so as to be covered by this policy, a request for a waiver to continue employment of both individuals must be submitted to the Senior Vice President, Corporate Services. Under no circumstances will exceptions be granted for officers at the Vice President level and above, or directors. In addition, related non-officer employees are prohibited from working in the same department, reporting to the same supervisor or reporting to a relative. This policy applies to directors, officers and employees of all affiliated companies, including situations in which the employees may be employed by separate legal entities. This policy also applies to consultants and service providers. For the purposes of this policy, a relative is defined as a spouse, child, parent, sibling, step-parent, step-child, step-sibling, grandparent, grandchild, aunt, uncle, nephew, niece, first cousin and in-law. WORKPLACE SAFETY Phoenix is committed to maintaining a work environment that is safe and healthy for its employees and others. Questions concerning health and safety matters should be referred to your supervisor or Human Resources representative. All job-related injuries or illnesses should be reported immediately to your supervisor or Human Resources representative. Phoenix also does not tolerate acts of violence or threats of violence against employees or Company property. Possession of firearms or other weapons anywhere on Company property or while conducting Company business is prohibited. Any situation or concern involving violent behavior or the threat of violence should be immediately reported to Security or Human Resources. DRUGS AND ALCOHOL The sale, purchase, use, possession or transfer of narcotics or other legally controlled substances by employees while on Company premises or on Company business (other than use of prescription drugs in accordance with a physician's orders) is prohibited. Employees attending functions on behalf of the Company where alcohol is served are expected to use good judgment and avoid consuming excessive amounts of alcoholic beverages. VIOLENT CRIME CONTROL AND LAW ENFORCEMENT ACT OF 1994 Federal Law prohibits the employment of any person convicted of a felony involving dishonesty or breach of trust by an insurance company without the consent of the appropriate state insurance department. To assist the Company in fulfilling its responsibilities under this law, employees are required to disclose any felony conviction to the Company at the time of application for employment. Any employee who is subsequently convicted of a felony must report this fact to the Company immediately. EMPLOYEE OWNERSHIP OF PHOENIX STOCK Employees, officers and directors are subject to various requirements including federal securities laws, and New York Insurance law restrictions governing the ownership of Company stock. Please refer to the Insider Trading and Personal Trading section of this Code for more information. COMMITMENT TO ETHICS AND COMPLIANCE - ----------------------------------- A STRONG COMMITMENT TO BUSINESS ETHICS AND COMPLIANCE IS THE FOUNDATION OF A SUCCESSFUL ORGANIZATION. EVERY EMPLOYEE IS EXPECTED TO CARRY OUT THE COMPANY'S BUSINESS ACTIVITIES IN AN ETHICAL MANNER AND CONSISTENT WITH APPLICABLE LAWS, REGULATIONS, POLICIES AND GUIDELINES. ETHICAL DECISION MAKING Phoenix's success is dependent on each of us applying the highest ethical standards to whatever we do on behalf of the Company. Consider the following guidelines in making ethical decisions. o Is my action consistent with approved Company practices? o Is my action consistent with the Company's preeminent values? o Does my action give the appearance of impropriety? o Can I, in good conscience, defend my action to my supervisor, other employees or the general public? o Does my action meet my personal code of ethical behavior? o Does my action conform to the spirit of these guidelines? COMPLIANCE WITH LAWS AND REGULATIONS Phoenix values its corporate reputation for complying with all applicable laws and regulations in the conduct of its business. Every employee, officer and director shall comply with all applicable laws and regulations while acting on behalf of the Company. MONITORING CODE COMPLIANCE The Corporate Compliance and the Corporate Audit Departments are responsible for monitoring the compliance activities of all areas and ensuring that the Code is being followed. Compliance will be monitored by periodic audits where appropriate. OBTAINING GUIDANCE In any instance where you are uncertain of your obligations under the Code, you should seek guidance before taking any action. If you have a question concerning the Code or any of the Company's related policies or procedures, you should contact the Corporate Compliance Department or the Law Department. TOLL-FREE HELP LINE Phoenix maintains a confidential, 24-hour, toll-free telephone help line for the purpose of requesting assistance or reporting violations. Assistance is available during regular business hours. If you call outside of regular business hours, leave a confidential message and your call will be returned the following business day. Special security measures have been taken with this help line to ensure confidentiality. If you wish to remain anonymous, you may request a case identification number and refer to that number in subsequent phone calls. OBLIGATION TO REPORT Employees are obligated to report suspected violations of the Code to their department head, the Chief Compliance Officer or the Law Department. Failure to do so will result in disciplinary action, including potential termination of employment. WHISTLEBLOWER PROTECTION No retaliation or retribution of any kind will be taken against an employee who reports a suspected violation of the Code in good faith. INVESTIGATION All allegations of suspected violations will be promptly investigated and appropriate action will be taken. Investigations will be conducted in an objective, professional manner. The specifics of an investigation, including the identity of the individual reporting the information, will be kept confidential except as such disclosure is necessary to fully investigate the allegations, facilitate resolution and/or report the results to appropriate authorities. DISCLOSURE TO GOVERNMENT AUTHORITIES Certain actions and omissions prohibited by the Code may also violate criminal laws and may subject violators to criminal prosecution. The Law Department will review the results of investigations that indicate potential violations of criminal law and recommend to the appropriate senior officers whether disclosure to appropriate enforcement authorities is warranted. DISCIPLINARY ACTION FOR VIOLATIONS Failure to adhere to the Code as well as other Company policies and applicable laws may result in disciplinary action up to and including termination of employment. Situations in which disciplinary action may be appropriate include: o Authorization of or participation in activities that violate the law, the Code or other Company policies; o Retaliation, direct or indirect, or encouragement of others to retaliate against an employee who reports a suspected violation; o Failure to cooperate with an investigation of suspected violations, including interfering with or obstructing an investigation; and o Failure to report a violation of the law, the Code or other Company policies. EX-31 4 g8386_ex99cert.txt EX-99.CERT--302 CERTIFICATIONS EX-99.CERT CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT I, Philip R. McLoughlin, certify that: 1. I have reviewed this report on Form N-CSR of Phoenix-Seneca Funds; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) [Omitted] (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: December 5, 2003 /S/PHILIP R. MCLOUGHLIN ------------------------------ --------------------------------------- Philip R. McLoughlin, Chairman (principal executive officer) CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT I, Nancy G. Curtiss, Treasurer, certify that: 1. I have reviewed this report on Form N-CSR of Phoenix-Seneca Funds; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) [Omitted] (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: December 5, 2003 /S/NANCY G. CURTISS ------------------------------- --------------------------------------- Nancy G. Curtiss, Treasurer (principal financial officer) EX-32 5 g8386_ex99906cert.txt EX-99.906CERT--906 CERTIFICATIONS EX-99.906CERT CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT I, Philip R. McLoughlin, Chairman of Phoenix-Seneca Funds (the "Registrant"), certify that: 1. The Form N-CSR of the Registrant (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. Date: December 5, 2003 /S/PHILIP R. MCLOUGHLIN ------------------------------- ------------------------------ Philip R. McLoughlin, Chairman (principal executive officer) I, Nancy G. Curtiss, Treasurer of Phoenix-Seneca Funds (the "Registrant"), certify that: 1. The Form N-CSR of the Registrant (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. Date: December 5, 2003 /S/NANCY G. CURTISS ------------------------------- ----------------------------- Nancy G. Curtiss, Treasurer (principal financial officer) -----END PRIVACY-ENHANCED MESSAGE-----