THE OAKMARK INTERNATIONAL FUND Report from David G. Herro

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK INTERNATIONAL FUND FROM ITS INCEPTION (9/30/92) TO PRESENT (3/31/07) AS COMPARED TO THE MSCI WORLD EX U.S. INDEX13   Average Annual Total Returns (as of 3/31/07)   Total Return Last 3 Months* 1-year 5-year 10-year Since Inception (9/30/92) Oakmark International Fund (Class I) 4.91% 24.37% 16.12% 12.06% 13.84% MSCI World ex U.S. 4.01% 19.60% 16.03% 8.56% 9.32% MSCI EAFE14 4.08% 20.20% 15.78% 8.31% 9.11% Lipper International Fund Index15 3.70% 18.83% 15.42% 8.90% 10.28% The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Expense Ratio as of 9/30/06 was 1.08%. The performance data quoted represents past performance. The above performance information for the Fund does not reflect the imposition of a 2% redemption fee on shares held for 90 days or less to deter market timers. If reflected, the fee would reduce the performance quoted. Past performance does not guarantee future results. The investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Average annual total return measures annualized change, while total return measures aggregate change. To obtain most recent month-end performance data, visit oakmark.com. * Not annualized

The Oakmark International Fund returned 5% for the quarter ending March 31, 2007, which compares favorably to the MSCI World ex U.S. Index return of 4%. More importantly, since the Fund’s inception in September 1992, it is up 14% per annum which again compares favorably with the MSCI World ex U.S. Index’s return of 9% over the same period.

Impact Players

As mentioned in the lead International letter, Nikko Cordial was a star performer for the Fund and was also the quarter’s largest contributor to return. The second largest contributor to return was Daimler- Chrysler with its stock price gaining 32% for the quarter. The Mercedes division continues its progressive turnaround in manufacturing and quality improvements. However, much of the boost in price was caused by news that management began exploring sale or divestiture possibilities for its ailing Chrysler division. Although its fate remains unclear, we remain confident that management will act to create the most long-term value for the overall group. Rounding out the top three was long-term holding Cadbury Schweppes plc, a UK-based confectionary and beverage company. Most of the 20% increase in price followed the mid-March announcement that a leading hedge fund had taken interest in 3% of issued share capital, which generated market speculation that the company was a takeover target. Bowing to pressure led by the new hedge fund activist, Cadbury announced the spin-off of its North American beverage unit, the maker of Dr. Pepper and 7 Up.

SK Telecom Co., a leading telecommunication provider in South Korea, was the biggest performance detractor. The stock was negatively affected by profit declines caused by the company’s decision to step up marketing spending in order to prevent market share losses in the increasingly competitive Korean market. Shares of Japanese security Rohm Co. also lagged during the quarter mostly due to an industry-wide weakness for semiconductor-related stocks. Our long-term outlook on the quality of these two businesses remains positive despite the lackluster short-term performance.

Portfolio Composition

During the quarter we sold our entire positions in Kao Corp., Lonza Group AG, Metro AG, and Michelin as they reached their respective sell targets. Samsung Electronics Co., a Korean manufacturer of consumer and industrial electronics equipment and products, was added to the portfolio towards the end of the quarter.

The portfolio composition remains relatively similar to last quarter, geographically speaking. We remain heavily weighted in the UK and Europe while our Japanese holdings remain underweight at 14% compared to the MSCI World ex U.S. weighting of 21%.

As long-term value investors, we continue to focus on finding attractive, under-valued foreign companies with management teams focused on building shareholder value.

International Diversification—March 31, 2007 (Unaudited)

Schedule of Investments—March 31, 2007 (Unaudited)