THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Directors and Officers
Paul Hottinguer Samuel B. Witt III, Esq.**
CHAIRMAN DIRECTOR
Eric R. Gabus+ Rodolphe E. Hottinger
VICE CHAIRMAN (NON OFFICER) PRESIDENT
CHIEF EXECUTIVE OFFICER
Paul R. Brenner, Esq.
DIRECTOR Rudolf Millisits
SENIOR VICE PRESIDENT
Alexandre de Takacsy TREASURER
DIRECTOR
Philippe Comby
Claude Frey VICE PRESIDENT
DIRECTOR
Edward J. Veilleux
Baron Hottinger VICE PRESIDENT
DIRECTOR SECRETARY
Claude Mosseri-Marlio Leslie K. Klenk
DIRECTOR ASSISTANT SECRETARY
Didier Pineau-Valencienne* Frederick Skillin
DIRECTOR ASSISTANT TREASURER
Stephen K. West, Esq.*
DIRECTOR
------------------------------------------------------
* Audit Committee member + Governance Committee
** Audit Committee chairman chairman
INVESTMENT ADVISOR
Hottinger Capital Corp.
1270 Avenue of the Americas, Suite 400
New York, New York 10020
(212) 332-7930
ADMINISTRATOR
Forum Administrative Services, LLC
(member of Citigroup Global Transaction Services)
CUSTODIAN
Swiss American Securities Inc.
TRANSFER AGENT
American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, New York 10038
LEGAL COUNSEL
Stroock & Stroock & Lavan LLP
INDEPENDENT AUDITORS
Deloitte & Touche LLP
The Investment Advisor
The Swiss Helvetia Fund, Inc. (the "Fund") is managed by Hottinger Capital
Corp., which belongs to the Hottinger Group.
The Hottinger Group dates back to Banque Hottinguer, which was formed in Paris
in 1786 and is one of Europe's oldest private banking firms. The Hottinger Group
has remained under the control of the Hottinger family through seven
generations. It has offices in New York, Zurich, Luxembourg, Toronto, Geneva,
Vienna, London, and the Bahamas.
EXECUTIVE OFFICES
The Swiss Helvetia Fund, Inc.
1270 Avenue of the Americas, Suite 400
New York, New York 10020 1-888-SWISS-00
(1-888-794-7700)
(212) 332-2760
FOR INQUIRIES AND REPORTS:
1-888-SWISS-00 (1-888-794-7700)
Fax (212) 332-7931
email: swz@swz.com
WEBSITE ADDRESS
http://www.swz.com
The Fund
The Swiss Helvetia Fund, Inc. is a non-diversified, closed-end investment
company whose objective is to seek long-term capital appreciation through
investment in equity and equity-linked securities of Swiss companies. The Fund,
listed on the New York Stock Exchange under the symbol "SWZ," is managed by
Hottinger Capital Corp.
The Fund has earned the Lipper, Inc. award for ranking number one among Western
European closed-end funds in ten year performance for the periods ended December
31, 2002, 2001, 2000, 1999, and 1998. The Fund had previously been recognized
for its top one year performance in the same category for the year 2000. The
Fund also was given Morningstar's overall rating of four stars as of March 31,
2004. Of course, past performance is no guarantee of future results. See page 3
for more information.
Net Asset Value is calculated daily by 6:15 P.M. (Eastern Time). The most recent
calculation is available by calling 1-888-SWISS-00 or by accessing our Website.
Weekly Net Asset Value is also published in BARRON'S, the Monday edition of THE
WALL STREET JOURNAL and the Sunday Edition of THE NEW YORK TIMES.
1
THE SWISS HELVETIA FUND, INC.
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Letter to Stockholders
GLOBAL MARKET OVERVIEW
The economic data released for the end of 2003 showed positive economic
growth for most countries, especially the U.S. and Japan. U.S. real Gross
Domestic Product ("GDP") grew at an annualized rate of 4.1% in the fourth
quarter of last year thanks to private consumption and exports, which benefited
from the dollar's decline against most currencies. In Japan real GDP expanded in
the fourth quarter at an annualized rate of 7%, its highest growth since 1990,
largely due to strong demand from China. Europe's GDP rose by a weak annualized
rate of 1.2% in the fourth quarter mainly due to moderate exports.
During the first quarter, stock markets were a little sluggish, even though
economic data was good and earnings releases were positive. The markets have
been trading sideways as fundamentals catch up with valuations. In addition
geopolitical risk and interest rate risk needed to be factored into the market
after the wave of optimism shown by investors at the beginning of the year. In
many regards the quarter under review has been the direct opposite of the same
period last year. In the U. S., the quarter saw a modest increase of 1.69% for
the S&P 500 and a decrease of 0.45% in the NASDAQ. In Switzerland, the Swiss
Market Index ("SMI") increased by 2.38% for the quarter, while in Japan the
Nikkei average led global markets with a strong 9.7% increase.
SWISS ECONOMIC NOTES
At its quarterly assessment as of March 18, 2004, the Swiss National Bank
("SNB") decided to leave the target range for the three-month LIBOR unchanged at
0.00% -- 0.75%. For the time being, the three-month LIBOR is to be kept at
around 0.25%. The SNB continues to adhere to its expansionary monetary policy in
view of the modest potential for inflation and its desire to continue to support
the economic recovery in Switzerland.
The interest rate on the 10-year Confederation bond decreased from 2.90% at
the beginning of the year to 2.36% in the middle of March and finished the
quarter at 2.60%.
GDP has been increasing the last three quarters (+ 0.5% in the fourth
quarter of 2003), leading to an increase in real GDP at an annualized rate of
1.8%. The main stimuli came from exports and a pick up in domestic demand in the
fourth quarter.
The unemployment rate decreased in each of the last three months and
reached a rate of 4.1% in March in comparison to 4.3% in January. This decrease
in unemployment rate, together with modest gains in the consumer confidence
index, is likely to support growth in private consumption, which, so far, has
remained slow.
The SNB anticipates economic growth of 1.5% -- 2.0% for 2004 and an average
annual inflation rate of 0.4% this year, 1.0% in 2005 and 2.3% in 2006.
SWISS MARKET REVIEW AND FUND PERFORMANCE
The Swiss market performed well during the first quarter as measured in
local currency,
2
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Letter to Stockholders (continued)
with increases of 2.38% in the SMI and 3.44% in the Swiss Performance Index
("SPI"). In U.S. dollar terms, however, the SMI decreased by 0.05% and the SPI
increased by 0.99%.
The Fund underperformed the SPI by 0.94%, mainly due to its continuing
cautious stance on the financial sector.
The Fund maintained, for the period ended March 31, 2004, an overall rating
of four stars from Morningstar.* The Fund also received Lipper, Inc.'s top
ranking for Western European closed-end funds in ten-year performance for the
period ended December 31, 2002.** Past performance is no guarantee of future
results.
--------------------------------------------------------
YEAR TO DATE
DECEMBER 31, 2003
THROUGH
MARCH 31, 2004
--------------------------------------------------------
PERFORMANCE IN SWISS FRANCS
Swiss Performance Index (SPI) 3.44%
--------------------------------------------------------
Swiss Helvetia Fund
--------------------------------------------------------
Based on Net Asset Value in Swiss Francs 2.50%
--------------------------------------------------------
CHANGE IN U. S. DOLLAR VS. SWISS FRANC 2.43%
--------------------------------------------------------
SWISS HELVETIA FUND PERFORMANCE
IN U. S. DOLLARS
--------------------------------------------------------
Based on Market Price 1.78%
--------------------------------------------------------
Based on Net Asset Value 0.07%
--------------------------------------------------------
S & P 500 Index 1.69%
--------------------------------------------------------
MSCI EAFE Index 4.34%
--------------------------------------------------------
Lipper European Fund Index (10 Largest) 2.22%
--------------------------------------------------------
Lipper European Fund Universe Average 2.05%
--------------------------------------------------------
*Morningstar is an independent fund performance monitor. Its ratings reflect
historic risk-adjusted performance and may change monthly. Its ratings of one
(low) and five (high) stars are based on a fund's three- and five-year average
annual total returns with fee adjustments, and a risk factor that reflects fund
performance relative to three-month Treasury Bill monthly returns. Only 33% of
the funds in an investment category may receive four of five stars. As of March
31, 2004, there were 11 funds in the Fund's asset category rated by Morningstar.
**Lipper, Inc. is an independent fund performance monitor. As of December 31,
2003, there were 8 funds in the Lipper Western European closed-end funds
category, which is comprised of funds that concentrate their investments in
equity securities whose primary trading markets or operations are in the Western
European region or a single country within this region.
COMMENTS ON THE CURRENCY
U.S. DOLLAR: The U.S. dollar stayed at low levels against all major
currencies during the first part of the quarter and started to appreciate in
mid-February. During the quarter it increased by more than 2% against the euro
and the Swiss franc and, until mid-March, by more than 4% against the Japanese
yen.
SWISS FRANC: The Swiss franc was relatively strong against all major
currencies except the U.S. dollar. In mid-March it reached 1.55 against the euro
and 2.30 against the pound sterling.
EURO: During the first quarter, the European Central Bank ("ECB") decided
to
3
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Letter to Stockholders (continued)
leave interest rates unchanged despite the fact that a strong euro in 2003 hurt
the performance of export industries. The outlook for price stability continues
to be favorable and low interest rates support economic recovery in the euro
area. Moreover, the ECB is willing to have a low euro in order to be able to
compete with the low U.S. dollar.
OUTLOOK
Barring a major geopolitical event, management is relatively optimistic
regarding 2004. However, market action since February has broken 2003's momentum
and earnings will have to be strong to support valuations and higher interest
rates. The Fund's stance is currently more defensive. Management increased the
Fund's weighting in the insurance sector in anticipation of lower claims during
a period of modest capacity utilization and average GDP growth (both of which
Management expects). In addition, the underwriting cycle has been stronger than
expected. Even though pricing power has peaked, premiums have stayed high enough
both to insure good profitability and to fund any needed increases in reserves
without negatively affecting consensus earnings estimates. The passage to higher
interest rates in the U.S. could hurt the performance of financial stocks in the
short-term. However, more normal yield levels will benefit the insurance stocks
in the medium-term, improving investment returns and margins on most product
lines.
STOCK REPURCHASE PROGRAM
Pursuant to authorization by the Board, the Fund began open market
purchases of its common stock on the New York Stock Exchange in 1999 and has
continued purchases in each subsequent year. The principal purpose of the stock
repurchase program is to enhance stockholder value by increasing the Fund's net
asset value per share without creating a meaningful adverse effect upon the
Fund's expense ratio and realizing capital gains in order to fund the
repurchases. The Board has authorized the purchase of up to 500,000 shares in
2004. The Fund did not repurchase any of its shares during the first quarter.
Sincerely,
/s/ Paul Hottinguer
Paul Hottinguer
CHAIRMAN
/s/ Rodolphe Hottinger
Rodolphe Hottinger
PRESIDENT AND CHIEF EXECUTIVE OFFICER
March 31st, 2004
4
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Letter to Stockholders (concluded)
------------------------------------------------------------------------------------------------------------------------
PEER GROUP/INDICES PERFORMANCE COMPARISON IN SWISS FRANCS(1)
------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, CUMULATIVE
YTD AS OF --------------------------------------------------------------- PERFORMANCE
3/31/04 2003 2002 2001 2000 1999 1998 1997 12/31/96 - 3/31/04
------------------------------------------------------------------------------------------------------------------------
SWISS HELVETIA FUND 2.50% 22.54% (20.40)% (22.91)% 14.06% 14.70% 15.57% 53.99% 79.45%
------------------------------------------------------------------------------------------------------------------------
Swiss Performance Index
(SPI) 3.44% 22.06% (25.95)% (22.03)% 11.91% 11.69% 15.36% 55.19% 63.12%
------------------------------------------------------------------------------------------------------------------------
Swiss Market Index (SMI) 2.38% 18.51% (27.84)% (21.11)% 7.47% 5.71% 14.28% 58.93% 42.52%
------------------------------------------------------------------------------------------------------------------------
Switzerland iShares(2)
(Formerly called Webs
Switzerland) 2.99% 19.14% (26.23)% (23.12)% 7.75% 12.22% 11.74% 47.79% 38.96%
------------------------------------------------------------------------------------------------------------------------
CS Equity Swiss Blue
Chips(3, 7) 2.06% 18.13% (28.75)% (22.12)% 10.97% 7.57% 14.21% 59.90% 45.84%
------------------------------------------------------------------------------------------------------------------------
UBS Equity Inv.
Switzerland(4, 7) 3.40% 18.14% (26.02)% (22.04)% 7.42% 6.43% 12.75% 55.94% 41.62%
------------------------------------------------------------------------------------------------------------------------
Pictet Valsuisse(5, 7) 3.20% 20.10% (27.93)% (22.35)% 7.34% 9.38% 11.05% 55.65% 40.76%
------------------------------------------------------------------------------------------------------------------------
Saraswiss (Bank
Sarasin)(6, 7) 2.21% 19.64% (28.51)% (24.45)% 9.72% 7.10% 14.41% 53.57% 36.36%
1 PERFORMANCE OF FUNDS IS BASED ON CHANGES IN THE FUND'S NAV OVER A SPECIFIED
PERIOD. IN EACH CASE TOTAL RETURN IS CALCULATED ASSUMING REINVESTMENT OF ALL
DISTRIBUTIONS. FUNDS LISTED, OTHER THAN SWITZERLAND ISHARES, ARE NOT REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION. PERFORMANCE AND DESCRIPTIVE
INFORMATION ABOUT THE FUNDS ARE DERIVED FROM THEIR PUBLISHED INVESTOR REPORTS
AND WEBSITES, WHICH ARE SUBJECT TO CHANGE.
2 SWITZERLAND ISHARES ARE TRADED ON THE NEW YORK STOCK EXCHANGE AND INVEST IN
MOST OF THE SAME STOCKS LISTED IN THE MORGAN STANLEY CAPITAL INTERNATIONAL
(SWITZERLAND) INDEX. THESE STOCKS REPRESENT SWITZERLAND'S LARGEST AND MOST
ESTABLISHED PUBLIC COMPANIES, ACCOUNTING FOR APPROXIMATELY 85% OF THE MARKET
CAPITALIZATION OF ALL OF SWITZERLAND'S PUBLICLY TRADED STOCKS. PERFORMANCE OF
ISHARES IS CALCULATED BASED UPON THE DECEMBER 31 CLOSING PRICES EACH YEAR USING
THE SWISS FRANC/U.S. DOLLAR EXCHANGE RATE AS OF NOON EACH SUCH DATE, AS REPORTED
BY BLOOMBERG. SUCH EXCHANGE RATES WERE AS FOLLOWS: 12/31/96 = 1.35, 12/31/97 =
1.46, 12/31/98 = 1.38, 12/31/99 = 1.60, 12/31/00 = 1.61, 12/31/01 = 1.67,
12/31/02 = 1.39, AND 3/31/04 = 1.27.
3 THIS FUND INVESTS IN EQUITIES ISSUED BY LEADING SWISS COMPANIES. STOCK
SELECTION IS BASED ON ECONOMIC, SECTOR AND COMPANY ANALYSES. PREFERENCE IS GIVEN
TO LARGE-CAP COMPANIES.
4 THIS FUND INVESTS PRIMARILY IN MAJOR SWISS COMPANIES. QUALITY CRITERIA USED
FOR DETERMINING RELATIVE WEIGHTINGS OF COMPANIES INCLUDE: STRATEGIC ORIENTATION,
STRENGTH OF MARKET POSITION, QUALITY OF MANAGEMENT, SOUNDNESS OF EARNINGS,
GROWTH POTENTIAL AND POTENTIAL FOR IMPROVING SHAREHOLDER VALUE. THE INVESTMENT
OBJECTIVE SEEKS TO PROVIDE RESULTS THAT ARE ALIGNED WITH THE SPI PERFORMANCE.
5 THIS FUND INVESTS IN SHARES OF SWISS COMPANIES LISTED ON THE SWISS STOCK
EXCHANGE (SWX) AND INCLUDED IN THE SPI.
6 THIS FUND INVESTS IN SHARES OF SWISS COMPANIES. IT WEIGHTS INDIVIDUAL SECTORS
RELATIVE TO THE SPI ON THE BASIS OF THEIR EXPECTED RELATIVE PERFORMANCE. IT
FOCUSES ON LIQUID BLUE-CHIP STOCKS.
7 THESE FUNDS ARE NOT AVAILABLE FOR U.S. RESIDENTS OR CITIZENS.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
5
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Schedule of Investments (Unaudited) March 31, 2004
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
COMMON STOCKS -- 93.70%
BANKS -- 12.03%
350,000 CREDIT SUISSE GROUP(2)
REGISTERED SHARES $ 12,128,508 3.28%
A global operating financial
group.
(Cost $9,516,917)
435,000 UBS AG(2)
REGISTERED SHARES 32,311,244 8.75%
Largest Swiss bank. It offers
consumer, business and
construction loans, mortgages,
mutual funds, export and
structured finance and
securities brokerage services,
advises on mergers and
acquisitions, invests pension
funds and sponsors credit
cards.
(Cost $7,578,949)
------------ ------
44,439,752 12.03%
BIOTECHNOLOGY -- 3.72%
116,491 ACTELION LTD.(1,2)
REGISTERED SHARES 12,597,598 3.41%
Pharmaceutical company that
develops and markets synthetic
small-molecule drugs against
diseases related to the
endothelium. The Company's
drugs, Veletri and Tracleer,
are used in the treatment of
heart and pulmonary
conditions.
(Cost $7,794,897)
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
BIOTECHNOLOGY -- (CONTINUED)
35,487 CYTOS BIOTECHNOLOGY AG(1)
REGISTERED SHARES $ 1,141,489 0.31%
Develops and produces
biopharmaceuticals. Produces
vaccines that immunize the
patient against disease
related proteins. This
instructs the immune system to
produce antibodies to reverse
or prevent disease
progression.
(Cost $1,433,020)
------------ ------
13,739,087 3.72%
CHEMICALS -- 6.45%
30,000 LONZA GROUP AG
REGISTERED SHARES 1,530,963 0.42%
The leading supplier of active
chemical ingredients,
intermediaries, and
biotechnology solutions to the
pharmaceutical and
agrochemical industries.
(Cost $1,535,111)
16,783 SIKA AG
BEARER SHARES 8,213,648 2.22%
Leading producer of
construction chemicals.
(Cost $4,237,473)
192,931 SYNGENTA AG(2)
REGISTERED SHARES 14,071,772 3.81%
Produces herbicides,
insecticides and fungicides,
and seeds for field crops,
vegetables, and flowers.
(Cost $12,234,006)
------------ ------
23,816,383 6.45%
6
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Schedule of Investments (Unaudited) (continued) March 31, 2004
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
CONSTRUCTION -- 4.54%
20,758 GEBERIT AG
REGISTERED SHARES $ 11,404,324 3.09%
Manufactures and supplies
water supply pipes and
fittings, installation
systems, drainage and flushing
systems such as visible
cisterns, and other sanitary
systems for the commercial and
residential construction
markets.
(Cost $7,721,250)
100,000 HOLCIM LTD.
REGISTERED SHARES 5,347,910 1.45%
Produces and markets various
building materials, in
addition to providing
consulting and engineering
services in all areas of the
cement manufacturing process.
(Cost $4,641,188)
------------ ------
16,752,234 4.54%
FOOD & BEVERAGES -- 15.11%
300 LINDT & SPRUNGLI AG
REGISTERED SHARES 3,013,380 0.82%
Major manufacturer of premium
Swiss chocolates.
(Cost $1,196,399)
207,000 NESTLE AG(2)
REGISTERED SHARES 52,777,361 14.29%
Largest food and beverage
processing company in the
world.
(Cost $12,427,540)
------------ ------
55,790,741 15.11%
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
HEALTH CARE -- 28.23%
1,315,000 NOVARTIS AG(2)
REGISTERED SHARES $ 55,844,812 15.12%
One of the leading
manufacturers of
pharmaceutical and nutrition
products.
(Cost $16,301,451)
306,409 PHONAK HOLDING AG
REGISTERED SHARES 7,376,938 2.00%
Designs and produces wireless
analog and digital hearing
aids, transmitters, remote
controls, microphones and
receivers for use in wireless
communications within
broadcasting and sports.
(Cost $3,226,748)
420,000 ROCHE HOLDING AG(2)
DIVIDENDS RIGHTS CERTIFICATES 41,026,957 11.11%
Worldwide pharmaceutical
company.
(Cost $8,467,363)
------------ ------
104,248,707 28.23%
INDUSTRIAL GOODS & SERVICES -- 7.41%
1,924,725 ABB LTD.(1)
REGISTERED SHARES 11,349,170 3.07%
The holding company for ABB
Group which is one of the
largest electrical engineering
firms in the world.
(Cost $7,367,303)
55,000 ADECCO SA(1)
REGISTERED SHARES 3,039,034 0.82%
Leading personnel and
temporary employment company.
(Cost $1,638,903)
7
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Schedule of Investments (Unaudited) (continued) March 31, 2004
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
INDUSTRIAL GOODS & SERVICES -- (CONTINUED)
2,055 BELIMO HOLDING AG
REGISTERED SHARES $ 965,169 0.26%
World market leader in damper
and volume control actuators
for ventilation and
air-conditioning equipment.
(Cost $450,523)
4,500 KABA HOLDINGS AG
BEARER SHARES 835,636 0.23%
Provides mechanical and
electronic security systems.
(Cost $809,667)
53,000 KUEHNE & NAGEL INTERNATIONAL AG
REGISTERED SHARES 7,520,030 2.04%
Operates sea freight, land and
rail transportation businesses
and warehousing and
distribution facilities.
(Cost $2,734,725)
6,598 SGS SOCIETE GENERALE DE
SURVEILLANCE HOLDING SA
REGISTERED SHARES 3,661,360 0.99%
Provides a variety of
industrial inspection,
analysis, testing and
verification services
worldwide.
(Cost $1,709,324)
------------ ------
27,370,399 7.41%
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
INSURANCE -- 9.14%
27,377 CONVERIUM HOLDING AG
REGISTERED SHARES $ 1,339,838 0.36%
Offers reinsurance services
worldwide. Provides accident
and health, automobile,
aviation and space, credit and
surety, general third party
liability, engineering,
e-commerce, intellectual
property, life, marine,
professional liability and
property, and catastrophe
insurance.
(Cost $1,260,992)
234,924 SWISS REINSURANCE COMPANY(1,2)
REGISTERED SHARES 16,188,866 4.39%
Second largest reinsurance
company in the world.
(Cost $16,575,214)
102,849 ZURICH FINANCIAL SERVICES AG (1,2)
REGISTERED SHARES 16,216,669 4.39%
Offers property, accident,
health, automobile, liability,
financial risk and life
insurance and retirement
products.
(Cost $17,099,830)
------------ ------
33,745,373 9.14%
RETAILERS -- 2.42%
78,018 CHARLES VOEGELE HOLDING AG(1)
BEARER SHARES 5,234,661 1.42%
Family apparel retailer which
focuses on the value-for-money
segment of the market.
Operates retail stores in Switzerland, Germany, Austria, and the
Benelux region.
(Cost $2,344,330)
8
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Schedule of Investments (Unaudited) (concluded) March 31, 2004
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
COMMON STOCKS -- (CONTINUED)
RETAILERS -- (CONTINUED)
24,767 GALENICA HOLDING AG
REGISTERED SHARES $ 3,699,850 1.00%
Manufactures and distributes
prescription and
over-the-counter drugs,
toiletries and hygiene
products.
(Cost $3,158,881)
------------ ------
8,934,511 2.42%
TECHNOLOGY -- 4.65%
35,230 HUBER & SUHNER AG
REGISTERED SHARES 2,031,457 0.55%
Manufactures a wide range of
products, extending from
cables for energy and
electrical submission to
special products such as
rubber.
(Cost $2,032,890)
272,765 LOGITECH INTERNATIONAL SA(1,2)
REGISTERED SHARES 12,369,538 3.35%
Manufactures personal computer
input devices, as well as
producing trackballs, desktop
publishing programs and
related software.
(Cost $9,769,349)
24,180 MICRONAS SEMICONDUCTOR HOLDING AG (1)
REGISTERED SHARES 1,143,294 0.31%
Develops and manufactures a
wide range of semiconductors
and modules used by the
automotive and consumer goods
industries.
(Cost $520,759)
Percent
No. of of Net
Shares Security Value Assets
----------------------------------------------------------------
TECHNOLOGY -- (CONTINUED)
207,012 TEMENOS GROUP AG(1)
REGISTERED SHARES $ 1,609,558 0.44%
Provides integrated software
for the banking sector. Develops,
distributes, implements, and
supports its process-oriented
real-time enterprise software
designed for the management of
administrative tasks in Europe,
North America, Asia, and the
Middle East.
(Cost $1,466,606)
------------ ------
17,153,847 4.65%
TOTAL COMMON STOCKS
(Cost $167,251,608) $345,991,034 93.70%
OTHER ASSETS IN EXCESS OF
LIABILITIES 23,270,528 6.30%
------------ ------
NET ASSETS $369,261,562 100.00%
============ ======
--------------------------------------------------------------------------------
(1) NON-INCOME PRODUCING SECURITY
(2) ONE OF THE TEN LARGEST PORTFOLIO HOLDINGS.
9
THE SWISS HELVETIA FUND, INC.
--------------------------------------------------------------------------------
Dividend Reinvestment Plan
THE PLAN
The Fund's Dividend Reinvestment Plan (the "Plan") offers a convenient way
for you to reinvest your capital gains distributions and ordinary income
dividends in additional shares of the Fund.
Some of the Plan features are:
- Once you enroll in the Plan, all of your future distributions and
dividends payable in whole or in part in cash will be automatically
reinvested in Fund shares.
- You will receive shares valued at the lower of the Fund's net asset
value or the Fund's market price as described below. The entire amount
of your distribution or dividend will be reinvested automatically in
additional Fund shares. For any balance that is insufficient to
purchase full shares of the Fund, your account will be credited with
fractional shares.
- Your shares will be held in an account with the Plan agent. You will
be sent regular statements for your records.
- You may terminate participation in the Plan at any time.
The following are answers to frequently asked questions about the Plan.
HOW DO I ENROLL IN THE PLAN?
If you are holding certificates for your shares, contact American Stock
Transfer & Trust Company (AST) at the address shown below. If your shares are
held in a brokerage account, contact your broker. Not all brokerage firms permit
their clients to participate in dividend reinvestment plans such as the Plan
and, even if your brokerage firm does permit participation, you may not be able
to transfer your Plan shares to another broker who does not permit
participation. Your brokerage firm will be able to advise you about its
policies.
HOW DOES THE PLAN WORK?
Any dividends or distributions you receive will be reinvested in shares of
the Fund. The number of shares credited to your Plan account as a result of the
reinvestment will depend upon the relationship between the Fund's market price
and its net asset value per share on the record date of the distribution or
dividend, as described below:
- If the net asset value is greater than the market price (the Fund is
trading at a discount), AST as Plan Agent, will buy Fund shares for
your account on the open market on the New York Stock Exchange or
elsewhere. Your dividends or distributions will be reinvested at the
average price AST pays for those purchases.
- If the net asset value is equal to the market price (the Fund is
trading at parity), the Fund will issue for your account new shares at
net asset value.
- If the net asset value is less than but within 95% of the market price
(the Fund is trading at a premium of less than 5%), the Fund will
issue for your account new shares at net asset value.
- If the net asset value is less than 95% of the market price (the Fund
is trading at a premium of 5% or more), the Fund will issue for your
account new shares at 95% of the market price.
If AST begins to buy Fund shares for your account at a discount to net
asset value but, during the course of the purchases, the Fund's market
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THE SWISS HELVETIA FUND, INC.
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Dividend Reinvestment Plan (concluded)
price increases to a level above the net asset value, AST will complete its
purchases, even though the result may be that the average price paid for the
purchases exceeds net asset value.
WILL THE ENTIRE AMOUNT OF MY DISTRIBUTION OR DIVIDEND BE REINVESTED?
The entire amount of your distribution or dividend will be reinvested in
additional Fund shares. If a balance remains after the purchase of whole shares,
your account will be credited with any fractional shares (rounded to three
decimal places) necessary to complete the reinvestment.
HOW CAN I SELL MY SHARES?
You can sell any or all of the shares in your Plan account by contacting
AST. AST charges $15 for the transaction plus $.10 per share for this service.
You can also withdraw your shares from your Plan account and sell them through
your broker.
DOES PARTICIPATION IN THE PLAN CHANGE THE TAX STATUS OF MY DISTRIBUTIONS OR
DIVIDENDS?
No. The distributions and dividends are paid in cash and their taxability
is the same as it would be if you received the cash. It is only after the
payment that AST reinvests the cash for your account.
HOW CAN I GET CERTIFICATES FOR THE SHARES IN THE PLAN?
AST will issue certificates for whole shares upon your request.
Certificates for fractional shares will not be issued.
IS THERE ANY CHARGE TO PARTICIPATE IN THE PLAN?
There is no charge to participate in the Plan. You will, however, pay a pro
rata share of brokerage commissions incurred with respect to AST's open market
purchases of shares for your Plan account.
HOW CAN I DISCONTINUE MY PARTICIPATION IN THE PLAN?
Contact your broker or AST in writing. If your shares are in a Plan
account, AST will send you a certificate for your whole shares and a check for
any fractional shares.
WHERE CAN I DIRECT MY QUESTIONS AND CORRESPONDENCE?
Contact your broker, or contact AST as follows:
By mail:
American Stock Transfer & Trust Company
PO Box 922
Wall Street Station
New York, New York 10269-0560
Through the Internet:
www.amstock.com
Through AST's automated voice response system: 1-888-556-0425
AST will furnish you with a copy of the Terms and Conditions of the Plan
without charge.
11
A SWISS THE SWISS
INVESTMENTS ---------------------------
FUND HELVETIA
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FUND, INC.
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www.swz.com
THE SWISS HELVETIA FUND, INC.
EXECUTIVE OFFICES
The Swiss Helvetia Fund, Inc.
1270 Avenue of the Americas
Suite 400
New York, New York 10020 QUARTERLY REPORT
1-888-SWISS-00 FOR THE
(212) 332-2760 PERIOD ENDED
http://www.swz.com MARCH 31, 2004