MERRILL LYNCH
GLOBAL GROWTH
FUND, INC.
FUND LOGO
Annual Report
August 31, 1999
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
Merrill Lynch
Global Growth Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
MERRILL LYNCH GLOBAL GROWTH FUND, INC.
Worldwide
Investments as of
August 31, 1999
Percent of
Ten Largest Industries Net Assets
Banking & Financial 16.2%
Telecommunications 14.5
Insurance 9.0
Pharmaceuticals 6.0
Communications Equipment 5.7
Retail Stores 4.4
Electronics 4.0
Chemicals 3.7
Electrical Equipment 2.6
Information Processing 2.4
Country of Percent of
Ten Largest Equity Holdings Origin Net Assets
Cisco Systems, Inc. United States 4.3%
COLT Telecom Group PLC United Kingdom 2.7
Vodafone AirTouch PLC United Kingdom 2.2
Siemens AG Germany 2.2
Deutsche Bank AG (Registered) Germany 1.9
Pfizer Inc. United States 1.9
General Electric Company United States 1.8
SAP AG (Systeme, Anwendungen,
Produkte in der Datenverarbeitung)
(Preferred) Germany 1.8
National Westminster Bank PLC United Kingdom 1.7
Metro AG Germany 1.5
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
DEAR SHAREHOLDER
Fiscal Year in Review
For the fiscal year ended August 31, 1999, total returns for Merrill
Lynch Global Growth Fund, Inc.'s Class A, Class B, Class C and Class
D Shares were +28.46%, +27.27%, +27.23% and +28.21%, respectively.
(Investment results shown do not reflect sales charges and would
be lower if sales charges were included. Complete performance
information can be found on pages 4 and 5 of this report to
shareholders.) For the same 12-month period, the total net
investment return for the Lipper Analytical Services Global Funds
Average was +32.77%, and the unmanaged Morgan Stanley Capital
International (MSCI) World Stock Index returned +33.05%. The Fund
underperformed the unmanaged MSCI World Stock Index largely because
it was significantly underweighted in Japan and the other Asian
markets. However, we continue to be concerned about the duration
and breadth of the business and profit recovery in the major
corporations in these markets. Also, stock valuations were much
higher in these markets than the stock valuations in the United
States and Europe. In some important cases, such as the South Korean
and Japanese stock markets, the equity valuations were almost twice
those of similar companies in the United States and Europe.
The Fund remained relatively fully invested during September and
October 1998 when many strategists were recommending selling stocks
and purchasing bonds. Our strategy benefited Fund performance during
the fiscal year ended August 31, 1999. Our holdings in the
technology, telecommunications services, retailing, information
processing and broadcasting industries also benefited total returns.
Companies in these industries that were significant contributors to
performance included Cisco Systems, Inc., Intel Corporation,
Microsoft Corporation, Compaq Computer Corporation, Dell Computer
Corporation, Equant, COLT Telecom Group PLC, Vodafone AirTouch Group
PLC, MCI Worldcom Inc., Nippon Telegraph & Telephone Corporation,
MetroNet Communications Corporation, Wal-Mart Stores, Inc., The Gap,
Inc., Staples, Inc., Carrefour SA, America Online, Inc., First Data
Corporation, CBS Corporation and Clear Channel Communications, Inc.
However, our significant weightings in the banking and financial,
insurance and pharmaceutical industries penalized the Fund's total
returns since early March 1999. Significant increases in energy
prices and long-term interest rates since December 1998 appear to
have caused a decline in valuation ratios for the companies in these
industries. Also, the Fund's relatively modest investment exposure
to energy companies hurt investment returns as the stock valuations
of major energy companies around the world rose with the sharp
increase in energy prices in 1999.
During the quarter ended February 28, 1999, we significantly reduced
our weighting in technology and retailing companies, particularly in
the United States. This move was in response to our concerns about
the relatively high valuations of individual stocks and the
potential for a deterioration in the outlook for profitable growth
for retailers and the profitability of the personal computer
business. This decision was a good one, based on the business
experience of many of the major companies in these industries and
stock price declines since our reduction of these investment
weightings. Therefore, the decline in the Fund's weighting of the
technology and retailing industries during late January and early
February 1999 improved comparative and absolute investment returns
until late in the August quarter. Then it appeared that investors
began to perceive a major cyclical improvement in the profitability
in the personal computer business and the profit prospects for Intel
Corporation and Microsoft Corporation. The Fund's performance in the
August quarter was held back by our relatively modest investment
exposure to these companies.
In Conclusion
We continue to focus our investments on the larger, higher-quality
companies in the developed economies around the world where we
believe the valuations are reasonable relative to the corporate
rates of return and prospective above-average growth in earnings.
We thank you for your investment in Merrill Lynch Global Growth
Fund, Inc., and we look forward to discussing our investment
strategy and outlook with you in our upcoming quarterly report to
shareholders.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Director
(Lawrence R. Fuller)
Lawrence R. Fuller
Senior Vice President and
Portfolio Manager
October 4, 1999
PERFORMANCE DATA
About Fund
Performance
Investors are able to purchase shares of the Fund through the
Merrill Lynch Select Pricing SM System, which offers four pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end
load) of 5.25% and bear no ongoing distribution or account
maintenance fees. Class A Shares are available only to eligible
investors.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.75% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after approximately 8 years. (There is no initial
sales charge for automatic share conversions.)
* Class C Shares are subject to a distribution fee of 0.75% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 5.25% and
an account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation
of future performance. Figures shown in the "Recent Performance
Results" and "Average Annual Total Return" tables assume
reinvestment of all dividends and capital gains distributions at net
asset value on the ex-dividend date. Investment return and principal
value of shares will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost. Dividends paid to each
class of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
PERFORMANCE DATA (concluded)
Total Return
Based on a $10,000
Investment
A line graph depicting the growth of an investment in the Fund's
Class A Shares and Class B Shares compared to growth of an
investment in the MSCI World Index. Beginning and ending values are:
10/31/97** 8/99
ML Global Growth Fund, Inc.++--
Class A Shares* $ 9,475 $13,121
ML Global Growth Fund, Inc.++--
Class B Shares* $10,000 $13,192
MSCI World Index++++ $10,000 $13,823
A line graph depicting the growth of an investment in the Fund's
Class C Shares and Class D Shares compared to growth of an
investment in the MSCI World Index. Beginning and ending values are:
10/31/97** 8/99
ML Global Growth Fund, Inc.++--
Class C Shares* $10,000 $13,588
ML Global Growth Fund, Inc.++--
Class D Shares* $ 9,475 $13,059
MSCI World Index++++ $10,000 $13,823
[FN]
*Assuming maximum sales charge, transaction costs and other
operating expenses, including advisory fees.
**Commencement of operations.
++MLGlobal Growth Fund, Inc. invests primarily in equity securities
with a particular emphasis on companies that have exhibited above-
average growth rates in earnings.
++++This unmanaged market capitalization-weighted Index is comprised
of a representative sampling of large-, medium-, and small-
capitalization companies in 22 countries, including the United
States.
Past performance is not predictive of future performance.
Average Annual
Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 6/30/99 +12.74% + 6.82%
Inception (10/31/97) through 6/30/99 +22.91 +18.99
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 6/30/99 +11.56% + 7.56%
Inception (10/31/97) through 6/30/99 +21.67 +20.08
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
% Return % Return
Without CDSC With CDSC**
Class C Shares*
Year Ended 6/30/99 +11.61% +10.61%
Inception (10/31/97) through 6/30/99 +21.70 +21.70
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Year Ended 6/30/99 +12.48% + 6.58%
Inception (10/31/97) through 6/30/99 +22.62 +18.71
[FN]
*Maximum sales charge is 5.25%.
**Assuming maximum sales charge.
<TABLE>
Recent
Performance
Results*
<CAPTION>
3 Month 12 Month Since Inception
As of August 31, 1999 Total Return Total Return Total Return
<S> <C> <C> <C>
ML Global Growth Fund, Inc. Class A Shares +2.50% +28.46% +38.48%
ML Global Growth Fund, Inc. Class B Shares +2.21 +27.27 +35.92
ML Global Growth Fund, Inc. Class C Shares +2.21 +27.23 +35.88
ML Global Growth Fund, Inc. Class D Shares +2.43 +28.21 +37.83
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included. Total
investment returns are based on changes in net asset values for the
periods shown, and assume reinvestment of all dividends and capital
gains distributions at net asset value on the ex-dividend date. The
Fund commenced operations on 10/31/97.
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (in US dollars)
<CAPTION>
NORTH Shares Value Percent of
AMERICA Industries Held Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Canada Banking & 380,000 Bank of Montreal $ 17,744,280 $ 13,371,314 0.5%
Financial 1,549,200 Canadian Imperial Bank of Commerce 42,925,733 33,694,062 1.4
500,000 National Bank of Canada 7,419,127 6,065,684 0.2
600,000 Royal Bank of Canada 30,163,355 25,636,729 1.0
-------------- -------------- ------
98,252,495 78,767,789 3.1
Communications 40,000 Nortel Networks Corporation 957,137 1,648,794 0.1
Equipment
Telecommunications 350,000 ++AT&T Canada Inc. 10,722,390 21,175,000 0.9
Total Investments in Canada 109,932,022 101,591,583 4.1
United Advertising 270,000 The Interpublic Group of
States Companies, Inc. 7,857,120 10,698,750 0.4
Banking & 210,000 Bank of America Corporation 12,801,659 12,705,000 0.5
Financial 150,000 Bank One Corporation 7,556,141 6,018,750 0.2
370,000 Citigroup Inc. 13,855,473 16,441,875 0.7
70,000 Mellon Bank Corporation 2,516,637 2,336,250 0.1
155,100 State Street Corporation 8,959,526 9,286,613 0.4
-------------- -------------- ------
45,689,436 46,788,488 1.9
Beverages 60,000 The Coca-Cola Company 5,163,012 3,588,750 0.1
Broadcasting 300,000 ++Infinity Broadcasting Corp.
--Media (Class A) 6,563,160 8,118,750 0.3
Broadcasting-- 230,000 ++AMFM Inc. 10,540,018 11,327,500 0.5
Radio & 200,000 ++CBS Corporation 5,624,578 9,400,000 0.4
Television 45,000 ++Clear Channel Communications, Inc. 2,176,875 3,152,812 0.1
-------------- -------------- ------
18,341,471 23,880,312 1.0
Chemicals 150,000 E.I. du Pont de Nemours and Company 8,410,948 9,506,250 0.4
Communications 265,000 ++3Com Corporation 7,345,262 6,558,750 0.3
Equipment 1,550,000 ++Cisco Systems, Inc. 48,463,908 105,012,500 4.3
85,000 ++Copper Mountain Networks, Inc. 6,557,297 9,966,250 0.4
60,000 Lucent Technologies Inc. 1,284,023 3,843,750 0.1
-------------- -------------- ------
63,650,490 125,381,250 5.1
Computers 125,000 Compaq Computer Corporation 4,489,688 2,898,437 0.1
70,000 ++Dell Computer Corporation 1,773,499 3,416,875 0.1
260,000 International Business Machines
Corporation 24,929,439 32,386,250 1.3
200,000 ++Sun Microsystems, Inc. 14,892,971 15,887,500 0.7
-------------- -------------- ------
46,085,597 54,589,062 2.2
Cosmetics 70,000 The Gillette Company 3,202,052 3,263,750 0.2
20,000 International Flavors & Fragrances
Inc. 968,044 815,000 0.0
-------------- -------------- ------
4,170,096 4,078,750 0.2
Diversified 300,000 Minnesota Mining and Manufacturing
Company (3M) 23,090,161 28,350,000 1.1
Electrical 35,000 Emerson Electric Co. 1,975,075 2,191,875 0.1
Equipment 400,000 General Electric Company 33,096,178 44,925,000 1.8
10,000 Honeywell Inc. 710,689 1,135,000 0.1
-------------- -------------- ------
35,781,942 48,251,875 2.0
Electronics 40,000 Intel Corporation 2,231,250 3,287,500 0.1
208,000 Texas Instruments Incorporated 14,232,175 17,069,000 0.7
-------------- -------------- ------
16,463,425 20,356,500 0.8
Energy 80,000 Duke Energy Corporation 4,569,624 4,600,000 0.2
500,000 El Paso Energy Corporation 18,280,128 18,281,250 0.7
424,000 Enron Corp. 16,735,083 17,755,000 0.7
80,000 UtiliCorp United Inc. 2,063,890 1,855,000 0.1
-------------- -------------- ------
41,648,725 42,491,250 1.7
Entertainment 450,000 The Walt Disney Company 14,343,318 12,487,500 0.5
Financial 25,000 American Express Company 2,015,550 3,437,500 0.1
Services 19,000 Federal Home Loan Mortgage
Association 1,119,469 978,500 0.0
25,000 Federal National Mortgage
Association 1,748,750 1,553,125 0.1
100,000 Franklin Resources, Inc. 5,500,811 3,593,750 0.2
30,000 Morgan Stanley Dean Witter & Co. 2,965,764 2,574,375 0.1
160,000 T. Rowe Price Associates, Inc. 5,943,509 4,900,000 0.2
-------------- -------------- ------
19,293,853 17,037,250 0.7
Food 50,000 Albertson's, Inc. 2,070,474 2,396,875 0.1
Merchandising 150,000 ++The Kroger Co. 2,846,305 3,468,750 0.2
65,000 ++Safeway Inc. 3,562,982 3,026,562 0.1
-------------- -------------- ------
8,479,761 8,892,187 0.4
Foods 40,000 ConAgra, Inc. 1,360,116 980,000 0.1
35,000 Wm. Wrigley Jr. Company 2,610,412 2,740,938 0.1
-------------- -------------- ------
3,970,528 3,720,938 0.2
Home Furnishings 262,500 Ethan Allen Interiors Inc. 8,275,521 7,661,719 0.3
Hotels 125,000 Marriott International, Inc. (Class A) 4,268,224 4,281,250 0.2
Household Products 40,000 Colgate-Palmolive Company 1,307,624 2,140,000 0.1
55,000 Kimberly-Clark Corporation 2,687,822 3,131,562 0.1
60,000 The Procter & Gamble Company 5,109,582 5,955,000 0.3
-------------- -------------- ------
9,105,028 11,226,562 0.5
Information 295,000 ++America Online, Inc. 10,686,874 26,937,187 1.1
Processing 55,000 First Data Corporation 2,297,388 2,420,000 0.1
107,000 ++General Motors Corporation
(Class H) 6,476,363 5,510,500 0.2
-------------- -------------- ------
19,460,625 34,867,687 1.4
Insurance 30,000 Aetna Inc. 2,524,121 2,332,500 0.1
85,000 American International Group, Inc. 8,056,987 7,878,437 0.3
370,000 The Hartford Financial Services
Group, Inc. 22,080,538 16,811,875 0.7
-------------- -------------- ------
32,661,646 27,022,812 1.1
Medical Technology 255,000 Abbott Laboratories 12,210,931 11,060,625 0.4
140,000 ++Boston Scientific Corporation 4,186,630 4,751,250 0.2
40,000 ++Guidant Corporation 1,258,388 2,347,500 0.1
25,000 Johnson & Johnson 1,503,390 2,556,250 0.1
-------------- -------------- ------
19,159,339 20,715,625 0.8
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
NORTH AMERICA Shares Value Percent of
(concluded) Industries Held Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
United Oil Services 170,000 Baker Hughes Incorporated $ 6,631,977 $ 5,780,000 0.3%
States 62,000 Diamond Offshore Drilling, Inc. 2,487,239 2,371,500 0.1
(concluded) 193,000 Schlumberger Limited 12,808,890 12,882,750 0.5
-------------- -------------- ------
21,928,106 21,034,250 0.9
Pharmaceuticals 70,000 ++Amgen Inc. 2,585,364 5,818,750 0.2
130,000 Bristol-Myers Squibb Company 8,549,002 9,148,750 0.4
420,000 Merck & Co., Inc. 23,700,031 28,218,750 1.1
1,215,000 Pfizer Inc. 38,360,281 45,866,250 1.9
-------------- -------------- ------
73,194,678 89,052,500 3.6
Photography 13,000 Eastman Kodak Company 815,032 954,687 0.0
Pollution Control 14,500 Waste Management, Inc. 505,400 316,281 0.0
Publishing 140,000 Gannett Co., Inc. 9,998,409 9,511,250 0.4
Restaurants 100,000 McDonald's Corporation 2,743,040 4,137,500 0.2
Retail Stores 100,000 The TJX Companies, Inc. 3,241,318 2,887,500 0.1
200,000 Wal-Mart Stores, Inc. 6,500,386 8,862,500 0.4
-------------- -------------- ------
9,741,704 11,750,000 0.5
Semiconductors 90,000 ++Applied Materials, Inc. 4,568,757 6,390,000 0.3
Software--Computer 20,000 ++Microsoft Corporation 1,066,343 1,850,000 0.1
Specialty Retailing 30,000 ++Abercrombie & Fitch Co. (Class A) 816,381 1,046,250 0.0
165,000 CVS Corporation 7,245,038 6,878,437 0.3
30,000 The Gap, Inc. 869,723 1,173,750 0.0
252,800 Lowe's Companies, Inc. 12,845,503 11,439,200 0.5
395,000 ++Staples, Inc. 8,523,621 8,566,562 0.4
35,000 ++Tommy Hilfiger Corporation 1,285,819 1,187,812 0.0
800,000 Walgreen Co. 19,922,431 18,550,000 0.8
-------------- -------------- ------
51,508,516 48,842,011 2.0
Telecommunications 622,500 AT&T Corp. 32,230,942 28,012,500 1.1
100,000 GTE Corporation 6,217,706 6,862,500 0.3
205,000 ++MCI WorldCom Inc. 10,007,100 15,515,937 0.6
780,000 Sprint Corp. (FON Group) 23,856,129 34,612,500 1.4
25,000 ++Sprint Corp. (PCS Group) 839,218 1,493,750 0.1
-------------- -------------- ------
73,151,095 86,497,187 3.5
Toys 200,000 Mattel, Inc. 7,823,472 4,262,500 0.2
Travel & Lodging 370,000 Carnival Corporation 12,306,515 16,534,375 0.7
Total Investments in the
United States 731,284,493 875,126,058 35.7
Total Investments in North America 841,216,515 976,717,641 39.8
PACIFIC
BASIN
Australia Telecommunications 4,000,000 ++Cable & Wireless Optus Limited 8,573,805 8,727,840 0.4
Total Investments in Australia 8,573,805 8,727,840 0.4
Japan Automobiles 100,000 Honda Motor Co., Ltd. 3,737,654 4,018,999 0.2
150,000 Toyota Motor Corporation 4,186,599 4,425,466 0.2
-------------- -------------- ------
7,924,253 8,444,465 0.4
Computers 200,000 Fujitsu Limited 2,366,284 5,864,085 0.2
Leisure 20,000 Sony Corporation 1,813,988 2,590,427 0.1
Office Equipment 25,000 Canon, Inc. 561,859 730,727 0.0
Photography 50,000 Fuji Photo Film 1,994,128 1,826,818 0.1
Retail 100,000 Ito-Yokado Co., Ltd. 5,399,601 7,362,075 0.3
Telecommunications 3,000 Nippon Telegraph & Telephone
Corporation (NTT) 26,362,868 33,704,786 1.4
Transportation 5,000 East Japan Railway Company 29,636,746 30,279,503 1.2
Total Investments in Japan 76,059,727 90,802,886 3.7
Total Investments in the Pacific
Basin 84,633,532 99,530,726 4.1
WESTERN
EUROPE
Denmark Telecommunications 300,000 Tele Danmark A/S 11,610,765 16,962,396 0.7
Total Investments in Denmark 11,610,765 16,962,396 0.7
Finland Communications 120,000 Nokia Oyj 2,745,757 10,008,036 0.4
Equipment
Total Investments in Finland 2,745,757 10,008,036 0.4
France Banking & 164,300 ++Credit Lyonnais 4,382,144 5,030,094 0.2
Financial
Broadcasting & 10,000 Societe Television Francaise 1 1,820,322 2,491,452 0.1
Publishing
Cosmetics 5,000 L'Oreal SA 1,869,813 3,227,803 0.1
Electrical 50,000 Alstom 1,681,549 1,682,786 0.1
Equipment
Electronics 360,000 STMicroelectronics 25,053,929 23,886,268 1.0
Foods 20,000 Groupe Danone 4,591,628 4,944,899 0.2
5,000 Promodes 2,986,130 4,713,701 0.2
-------------- -------------- ------
7,577,758 9,658,600 0.4
Information 50,000 Cap Gemini SA 4,425,728 8,577,563 0.3
Processing
Insurance 172,000 Axa 12,635,306 21,390,171 0.9
Pharmaceuticals 50,000 Rhone-Poulenc SA 2,419,376 2,423,887 0.1
Retail Stores 90,000 Carrefour SA 9,213,261 14,632,002 0.6
Total Investments in France 71,079,186 93,000,626 3.8
Germany Apparel 50,000 Adidas-Salomon AG 8,340,102 4,645,080 0.2
Automobiles 300,000 DaimlerChrysler AG 27,823,506 22,613,094 0.9
Banking & 600,000 Commerzbank AG 21,297,933 21,472,938 0.9
Financial 700,000 Deutsche Bank AG (Registered Shares) 41,566,543 47,812,653 1.9
525,000 Dresdner Bank AG 22,202,477 24,164,973 1.0
-------------- -------------- ------
85,066,953 93,450,564 3.8
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in US dollars)
<CAPTION>
WESTERN
EUROPE Shares Value Percent of
(continued) Industries Held Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
Germany Chemicals 500,000 BASF AG $ 21,269,815 $ 22,644,765 0.9%
(concluded) 480,000 Bayer AG 19,910,048 20,852,186 0.8
500,000 Hoechst AG 23,560,118 21,114,000 0.9
-------------- -------------- ------
64,739,981 64,610,951 2.6
Electronics 640,000 Siemens AG 47,892,081 53,781,581 2.2
Insurance 79,000 Allianz AG (Registered Shares) 21,085,769 20,791,695 0.9
Multi-Industry 185,000 Mannesmann AG 22,283,962 28,358,213 1.2
175,000 Veba AG 11,173,578 11,140,274 0.4
-------------- -------------- ------
33,457,540 39,498,487 1.6
Retail Stores 650,000 Metro AG 34,595,389 37,260,932 1.5
Software--Computer 110,000 SAP AG (Systeme, Anwendungen,
Produkte in der Datenverarbeitung)
(Preferred) 34,118,327 44,128,260 1.8
Total Investments in Germany 357,119,648 380,780,644 15.5
Ireland Banking & 1,700,000 Allied Irish Banks PLC 19,831,415 21,966,288 0.9
Financial
Telecommunications 100,000 ++Esat Telecom Group PLC (ADR)* 3,206,252 4,075,000 0.2
Total Investments in Ireland 23,037,667 26,041,288 1.1
Italy Banking & 4,500,000 Banca di Roma 7,569,237 6,109,336 0.2
Financial 2,000,000 Unicredito Italiano SpA 9,830,384 9,226,818 0.4
-------------- -------------- ------
17,399,621 15,336,154 0.6
Insurance 550,000 Assicurazioni Generali 13,942,232 18,551,288 0.7
4,000,000 Istituto Nazionale delle
Assicurazioni SpA (INA) 6,507,926 9,627,984 0.4
-------------- -------------- ------
20,450,158 28,179,272 1.1
Real Estate 3,750,000 Unione Immobiliare SpA 1,077,689 1,797,329 0.1
Investment Trust
Total Investments in Italy 38,927,468 45,312,755 1.8
Netherlands Chemicals 285,000 Akzo Nobel NV 12,974,386 13,253,522 0.5
45,000 DSM NV 5,610,018 5,289,849 0.2
-------------- -------------- ------
18,584,404 18,543,371 0.7
Household Products 223,214 Unilever NV 'A' 15,001,154 15,517,356 0.6
107,142 Unilever NV (NY Registered Shares) 8,031,036 7,379,405 0.3
-------------- -------------- ------
23,032,190 22,896,761 0.9
Insurance 400,000 Aegon NV 21,905,046 34,964,784 1.4
300,000 ING Groep NV 13,600,442 16,437,249 0.7
-------------- -------------- ------
35,505,488 51,402,033 2.1
Leisure 127,600 Koninklijke (Royal) Philips
Electronics NV 12,688,704 13,140,699 0.5
Retail Stores 600,000 Koninklijke Ahold NV 17,678,413 21,472,938 0.9
Telecommunications 212,500 ++Equant 9,040,710 18,788,161 0.8
Total Investments in the Netherlands 116,529,909 146,243,963 5.9
Portugal Telecommunications 323,000 Portugal Telecom SA (Registered
Shares) 12,881,818 13,499,838 0.5
Total Investments in Portugal 12,881,818 13,499,838 0.5
Spain Banking & 600,000 ++Banco Bilbao Vizcaya, SA 10,279,815 7,993,760 0.3
Financial 1,100,000 Banco Santander Central Hispano, SA 11,648,050 11,043,678 0.5
-------------- -------------- ------
21,927,865 19,037,438 0.8
Information 750,000 ++Telefonica Publicidad e
Processing Informacion, SA 14,051,000 17,181,518 0.7
Total Investments in Spain 35,978,865 36,218,956 1.5
Sweden Communications 50,000 Telefonaktiebolaget LM Ericsson 'B' 998,239 1,613,099 0.1
Equipment
Total Investments in Sweden 998,239 1,613,099 0.1
Switzerland Foods 12,000 Nestle SA (Registered Shares) 20,005,700 23,680,042 1.0
Insurance 31,000 Zurich Allied AG 15,191,232 18,188,358 0.7
Pharmaceuticals 18,000 Novartis AG (Registered Shares) 28,480,812 25,897,571 1.1
Total Investments in Switzerland 63,677,744 67,765,971 2.8
United Banking & 1,200,000 Barclays PLC 30,747,245 35,668,740 1.4
Kingdom Financial 750,000 HSBC Holdings PLC 7,588,742 9,272,667 0.4
2,500,000 Lloyds TSB Group PLC 32,526,945 34,564,134 1.4
2,000,000 National Westminster Bank PLC 32,517,060 41,099,386 1.7
-------------- -------------- ------
103,379,992 120,604,927 4.9
Broadcasting 1,300,000 British Sky Broadcasting Group
--Media PLC ("BSkyB") 8,212,658 12,302,502 0.5
Chemicals 50,000 Imperial Chemical Industries PLC 753,608 567,968 0.0
Electrical 2,400,000 Invensys PLC 13,238,327 12,243,054 0.5
Equipment
Household 669,642 Unilever PLC 5,692,608 6,315,614 0.3
Products
Insurance 1,200,000 CGU PLC 17,278,173 17,863,291 0.7
3,636,363 Royal & Sun Alliance Insurance
Group PLC 36,932,864 30,264,380 1.3
607,500 Sun Life and Provincial Holdings PLC 3,976,071 4,682,697 0.2
-------------- -------------- ------
58,187,108 52,810,368 2.2
Pharmaceuticals 150,000 AstraZeneca Group PLC 6,217,643 5,952,824 0.3
400,000 Glaxo Wellcome PLC 12,473,697 10,514,245 0.4
1,000,000 SmithKline Beecham PLC 11,359,894 13,022,304 0.5
-------------- -------------- ------
30,051,234 29,489,373 1.2
Publishing 250,000 Pearson PLC 3,653,585 5,157,507 0.2
Retail Stores 1,000,000 Boots Company PLC 14,334,393 12,339,456 0.5
100,000 J Sainsbury PLC 847,793 689,274 0.0
1,499,200 Somerfield PLC 9,606,795 5,588,334 0.3
1,000,000 Tesco PLC 2,695,989 2,960,345 0.1
-------------- -------------- ------
27,484,970 21,577,409 0.9
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in US dollars)
<CAPTION>
WESTERN
EUROPE Shares Value Percent of
(concluded) Industries Held Investments Cost (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C>
United Telecommunications 3,000,000 ++COLT Telecom Group PLC $ 13,265,802 $ 65,312,355 2.7%
Kingdom 1,250,000 Cable & Wireless PLC 16,911,329 14,339,798 0.6
(concluded) 600,000 ++Energis PLC 17,003,560 15,366,479 0.6
2,750,000 Vodafone AirTouch PLC 21,969,857 55,407,050 2.2
-------------- -------------- ------
69,150,548 150,425,682 6.1
Total Investments in the United
Kingdom 319,804,638 411,494,404 16.8
Total Investments in Western
Europe 1,054,391,704 1,248,941,976 50.9
SHORT-TERM Face
SECURITIES Amount Issue
Commercial $ 22,000,000 Associates First Capital Corp.,
Paper** 5.52% due 9/01/1999 22,000,000 22,000,000 0.9
100,409,000 General Motors Acceptance Corp.,
5.56% due 9/01/1999 100,409,000 100,409,000 4.1
Total Investments in Short-Term
Securities 122,409,000 122,409,000 5.0
Total Investments $2,102,650,751 2,447,599,343 99.8
==============
Other Assets Less Liabilities 4,361,706 0.2
-------------- ------
Net Assets $2,451,961,049 100.0%
============== ======
<FN>
*American Depositary Receipts (ADR).
**Commercial Paper is traded on a discount basis; the interest rates
shown reflect the discount rates paid at the time of purchase by the
Fund.
++Non-income producing security.
See Notes to Financial Statements.
</TABLE>
PORTFOLIO CHANGES (unaudited)
For the Quarter Ended August 31, 1999
Additions
3Com Corporation
Akzo Nobel NV
Copper Mountain Networks, Inc.
Credit Lyonnais
DSM NV
Duke Energy Corporation
East Japan Railway Company
General Motors Corporation (Class H)
Portugal Telecom SA (Registered Shares)
STMicroelectronics
Sun Microsystems, Inc.
Telefonica Publicidad e Informacion, SA
UtiliCorp United Inc.
Deletion
Ameritech Corporation
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of August 31, 1999
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$2,102,650,751) (Note 1a) $2,447,599,343
Foreign cash (Note 1b) 12,050,200
Cash 15,147
Receivables:
Dividends $ 4,533,750
Capital shares sold 1,827,534 6,361,284
--------------
Deferred organization expenses (Note 1f) 70,549
Prepaid registration fees and other assets (Note 1f) 190,864
--------------
Total assets 2,466,287,387
--------------
Liabilities: Payables:
Capital shares redeemed 5,875,150
Securities purchased 3,836,886
Distributor (Note 2) 1,807,889
Investment adviser (Note 2) 1,596,122 13,116,047
--------------
Accrued expenses and other liabilities 1,210,291
--------------
Total liabilities 14,326,338
--------------
Net Assets: Net assets $2,451,961,049
==============
Net Assets Class A Shares of Common Stock, $.10 par value, 100,000,000
Consist of: shares authorized $ 1,262,624
Class B Shares of Common Stock, $.10 par value, 300,000,000
shares authorized 12,522,413
Class C Shares of Common Stock, $.10 par value, 100,000,000
shares authorized 2,256,443
Class D Shares of Common Stock, $.10 par value, 100,000,000
shares authorized 2,231,264
Paid-in capital in excess of par 1,928,550,291
Accumulated investment loss--net (1,216,385)
Undistributed realized capital gains on investments and foreign
currency transactions--net 161,444,685
Unrealized appreciation on investments and foreign currency
transactions--net 344,909,714
--------------
Net assets $2,451,961,049
==============
Net Asset Class A--Based on net assets of $171,140,536 and 12,626,242
Value: shares outstanding $ 13.55
==============
Class B--Based on net assets of $1,677,021,645 and 125,224,125
shares outstanding $ 13.39
==============
Class C--Based on net assets of $302,246,698 and 22,564,433
shares outstanding $ 13.39
==============
Class D--Based on net assets of $301,552,170 and 22,312,636
shares outstanding $ 13.51
==============
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended August 31, 1999
<S> <S> <C> <C>
Investment Dividends (net of $3,224,773 foreign withholding tax) $ 34,243,103
Income: Interest and discount earned 3,257,335
--------------
Total income 37,500,438
--------------
Expenses: Investment advisory fees (Note 2) $ 16,878,695
Account maintenance and distribution fees--Class B (Note 2) 15,814,131
Account maintenance and distribution fees--Class C (Note 2) 2,960,222
Transfer agent fees--Class B (Note 2) 1,886,355
Account maintenance fees--Class D (Note 2) 685,484
Custodian fees 481,964
Transfer agent fees--Class C (Note 2) 374,084
Transfer agent fees--Class D (Note 2) 273,552
Printing and shareholder reports 250,051
Accounting services (Note 2) 212,458
Professional fees 154,802
Transfer agent fees--Class A (Note 2) 126,333
Directors' fees and expenses 49,529
Amortization of organization expenses--net (Note 1f) 22,279
Pricing fees 9,767
Other 6,144
--------------
Total expenses 40,185,850
--------------
Investment loss--net (2,685,412)
--------------
Realized & Realized gain (loss) from:
Unrealized Gain Investments--net 165,661,325
(Loss) on Foreign currency transactions--net (664,057) 164,997,268
Investments & --------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net 328,632,175
(Notes 1b, Foreign currency transactions--net (332,852) 328,299,323
1c, 1e & 3): -------------- --------------
Net realized and unrealized gain on investments and foreign
currency transactions 493,296,591
--------------
Net Increase in Net Assets Resulting from Operations $ 490,611,179
==============
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the For the Period
Year Ended Oct. 31, 1997++
Increase (Decrease) in Net Assets: Aug. 31, 1999 to Aug. 31, 1998
<S> <S> <C> <C>
Operations: Investment income (loss)--net $ (2,685,412) $ 2,377,734
Realized gain on investments and foreign currency
transactions--net 164,997,268 27,724,171
Change in unrealized appreciation/depreciation on
investments and foreign currency transactions--net 328,299,323 16,610,391
-------------- --------------
Net increase in net assets resulting from operations 490,611,179 46,712,296
-------------- --------------
Dividends & In excess of investment income--net:
Distributions to Class A (637,843) --
Shareholders Class B (442,017) --
(Note 1g): Class C -- --
Class D (1,298,285) --
Realized gain on investments--net:
Class A (1,299,337) --
Class B (20,963,417) --
Class C (4,032,145) --
Class D (3,512,417) --
-------------- --------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (32,185,461) --
-------------- --------------
Capital Share Net increase in net assets derived from capital share
Transactions transactions 190,399,619 1,756,323,416
(Note 4): -------------- --------------
Net Assets: Total increase in net assets 648,825,337 1,803,035,712
Beginning of period 1,803,135,712 100,000
-------------- --------------
End of period* $2,451,961,049 $1,803,135,712
============== ==============
<FN>
*Undistributed (accumulated) investment income
(loss)--net (Note 1h) $ (1,216,385) $ 330,777
============== ==============
++Commencement of operations.
See Notes to Financial Statements.
</TABLE>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
Class A Class B
For the For the
The following per share data and ratios Period Period
have been derived from information provided For the Oct. 31, For the Oct. 31,
in the financial statements. Year Ended 1997++ to Year Ended 1997++ to
Aug. 31, Aug. 31, Aug. 31, Aug. 31,
Increase (Decrease) in Net Asset Value: 1999++++++ 1998 1999++++++ 1998
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 10.78 $ 10.00 $ 10.68 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income (loss)--net .11 .06 (.03) --++++
Realized and unrealized gain on investments and
foreign currency transactions--net 2.93 .72 2.92 .68
---------- ---------- ---------- ----------
Total from investment operations 3.04 .78 2.89 .68
---------- ---------- ---------- ----------
Less dividends and distributions:
In excess of investment income--net (.09) -- --++++ --
Realized gain on investments--net (.18) -- (.18) --
---------- ---------- ---------- ----------
Total dividends and distributions (.27) -- (.18) --
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.55 $ 10.78 $ 13.39 $ 10.68
========== ========== ========== ==========
Total Investment Based on net asset value per share 28.46% 7.80%+++ 27.27% 6.80%+++
Return:** ========== ========== ========== ==========
Ratios to Average Expenses .90% .98%* 1.91% 1.99%*
Net Assets: ========== ========== ========== ==========
Investment income (loss)--net .88% 1.00%* (.27%) .05%*
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $ 171,140 $ 80,525 $1,677,022 $1,261,129
Data: ========== ========== ========== ==========
Portfolio turnover 46.91% 29.67% 46.91% 29.67%
========== ========== ========== ==========
<CAPTION>
Class C Class D
For the For the
The following per share data and ratios Period Period
have been derived from information provided For the Oct. 31, For the Oct. 31,
in the financial statements. Year Ended 1997++ to Year Ended 1997++ to
Aug. 31, Aug. 31, Aug. 31, Aug. 31,
Increase (Decrease) in Net Asset Value: 1999++++++ 1998 1999++++++ 1998
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 10.68 $ 10.00 $ 10.75 $ 10.00
Operating ---------- ---------- ---------- ----------
Performance: Investment income (loss)--net (.04) --++++ .07 .07
Realized and unrealized gain on investments
and foreign currency transactions--net 2.93 .68 2.94 .68
---------- ---------- ---------- ----------
Total from investment operations 2.89 .68 3.01 .75
---------- ---------- ---------- ----------
Less dividends and distributions:
In excess of investment income--net -- -- (.07) --
Realized gain on investments--net (.18) -- (.18) --
---------- ---------- ---------- ----------
Total dividends and distributions (.18) -- (.25) --
---------- ---------- ---------- ----------
Net asset value, end of period $ 13.39 $ 10.68 $ 13.51 $ 10.75
========== ========== ========== ==========
Total Investment Based on net asset value per share 27.23% 6.80%+++ 28.21% 7.50%+++
Return:** ========== ========== ========== ==========
Ratios to Average Expenses 1.92% 1.99%* 1.14% 1.22%*
Net Assets: ========== ========== ========== ==========
Investment income (loss)--net (.30%) .04%* .51% .82%*
========== ========== ========== ==========
Supplemental Net assets, end of period (in thousands) $ 302,247 $ 249,208 $ 301,552 $ 212,274
Data: ========== ========== ========== ==========
Portfolio turnover 46.91% 29.67% 46.91% 29.67%
========== ========== ========== ==========
<FN>
*Annualized.
**Total investment return excludes the effects of sales charges.
++Commencement of operations.
++++Amount is less than $.01 per share.
++++++Based on average shares outstanding.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Global Growth Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a diversified, open-end
management investment company. The Fund's financial statements are
prepared in accordance with generally accepted accounting
principles, which may require the use of management accruals and
estimates. The Fund offers four classes of shares under the Merrill
Lynch Select Pricingsm System. Shares of Class A and Class D are
sold with a front-end sales charge. Shares of Class B and Class C
may be subject to a contingent deferred sales charge. All classes of
shares have identical voting, dividend, liquidation and other rights
and the same terms and conditions, except that Class B, Class C and
Class D Shares bear certain expenses related to the account
maintenance of such shares, and Class B and Class C Shares also bear
certain expenses related to the distribution of such shares. Each
class has exclusive voting rights with respect to matters relating
to its account maintenance and distribution expenditures. The
following is a summary of significant accounting policies followed
by the Fund.
(a) Valuation of investments--Portfolio securities that are traded
on stock exchanges are valued at the last sale price on the exchange
on which such securities are traded, as of the close of business on
the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange
designated by or under the authority of the Board of Directors as
the primary market. Securities that are traded both in the over-the-
counter market and on a stock exchange are valued according to the
broadest and most representative market. Options written or
purchased are valued at the last sale price in the case of exchange-
traded options. In the case of options traded in the over-the-
counter market, valuation is the last asked price (options written)
or the last bid price (options purchased). Short-term securities
are valued at amortized cost, which approximates market value. Other
investments, including futures contracts and related options, are
stated at market value. Securities and assets for which market
quotations are not available are valued at fair value as determined
in good faith by or under the direction of the Fund's Board of
Directors.
(b) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(c) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the equity and currency
markets. Losses may arise due to changes in the value of the
contract or if the counterparty does not perform under the contract.
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
NOTES TO FINANCIAL STATEMENTS (continued)
* Options--The Fund is authorized to write and purchase call and put
options. When the Fund writes an option, an amount equal to the
premium received by the Fund is reflected as an asset and an
equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current market value of the option
written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
* Forward foreign exchange contracts--The Fund is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Fund's records. However, the effect on
operations is recorded from the date the Fund enters into such
contracts.
* Foreign currency options and futures--The Fund may also purchase
or sell listed or over-the-counter foreign currency options, foreign
currency futures and related options on foreign currency futures as
a short or long hedge against possible variations in foreign
exchange rates. Such transactions may be effected with respect to
hedges on non-US dollar denominated securities owned by the Fund,
sold by the Fund but not yet delivered, or committed or anticipated
to be purchased by the Fund.
* Financial futures contracts--The Fund may purchase or sell
financial futures contracts and options on such futures contracts
for the purpose of hedging the market risk on existing securities or
the intended purchase of securities. Futures contracts are contracts
for delayed delivery of securities at a specific future date and at
a specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as variation margin
and are recorded by the Fund as unrealized gains or losses. When the
contract is closed, the Fund records a realized gain or loss equal
to the difference between the value of the contract at the time it
was opened and the value at the time it was closed.
(d) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required. Under the applicable foreign tax law, a
withholding tax may be imposed on interest, dividends, and capital
gains at various rates.
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Dividend income is recorded on the ex-
dividend dates. Dividends from foreign securities where the ex-
dividend date may have passed are subsequently recorded when the
Fund has determined the ex-dividend date. Interest income (including
amortization of discount) is recognized on the accrual basis.
Realized gains and losses on security transactions are determined on
the identified cost basis.
(f) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense on a straight-
line basis over a period not exceeding five years. Prepaid
registration fees are charged to expense as the related shares are
issued.
(g) Dividends and distributions--Dividends and distributions paid by
the Fund are recorded on the ex-dividend dates. Distributions in
excess of investment income are due primarily to differing tax
treatments for foreign currency transactions.
(h) Reclassification--Generally accepted accounting principles
require that certain components of net assets be adjusted to reflect
permanent differences between financial and tax reporting.
Accordingly, current year's permanent book/tax differences of
$3,516,395 have been reclassified between undistributed net realized
capital gains and accumulated net investment loss. These
reclassifications have no effect on net assets or net asset values
per share.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect wholly-
owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is
the limited partner. The Fund has also entered into a Distribution
Agreement and Distribution Plans with Merrill Lynch Funds
Distributor ("MLFD" or the "Distributor"), a division of Princeton
Funds Distributor, Inc. ("PFD"), which is a wholly-owned subsidiary
of Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets at an annual rate of .75% of the
average daily net assets not exceeding $1.5 billion and .725% of the
average daily net assets in excess of $1.5 billion.
Pursuant to the Distribution Plans adopted by the Fund in accordance
with Rule 12b-1 under the Investment Company Act of 1940, the Fund
pays the Distributor ongoing account maintenance and distribution
fees. The fees are accrued daily and paid monthly at annual rates
based upon the average daily net assets of the shares as follows:
Account Distribution
Maintenance Fee Fee
Class B .25% .75%
Class C .25% .75%
Class D .25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Incorporated ("MLPF&S"), a subsidiary of ML &
Co., also provides account maintenance and distribution services to
the Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
For the year ended August 31, 1999, MLFD earned underwriting
discounts and direct commissions and MLPF&S earned dealer
concessions on sales of the Fund's Class A and Class D Shares as
follows:
MLFD MLPF&S
Class A $ 348 $ 4,127
Class D $26,372 $371,965
For the year ended August 31, 1999, MLPF&S received contingent
deferred sales charges of $4,436,483 and $141,177 relating to
transactions in Class B and Class C Shares, respectively.
In addition, MLPF&S received $226,138 in commissions on the
execution of portfolio security transactions for the Fund for the
year ended August 31, 1999.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of
ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of MLAM, PSI, FDS, PFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended August 31, 1999 were $1,093,044,801 and
$1,026,493,232, respectively.
Net realized gains (losses) for the year ended August 31, 1999 and
net unrealized gains (losses) as of August 31, 1999 were as follows:
Realized Unrealized
Gains Gains
(Losses) (Losses)
Long-term investments $165,661,325 $344,948,592
Foreign currency transactions (664,057) (38,878)
------------ ------------
Total $164,997,268 $344,909,714
============ ============
As of August 31, 1999, net unrealized appreciation for Federal
income tax purposes aggregated $344,948,592, of which $440,379,007
related to appreciated securities and $95,430,415 related to
depreciated securities. At August 31, 1999, the aggregate cost of
investments for Federal income tax purposes was $2,102,650,751.
4. Capital Share Transactions:
Net increase in net assets derived from capital share transactions
was $190,399,619 and $1,756,323,416 for the year ended August 31,
1999 and for the period October 31, 1997 to August 31, 1998.
Transactions in capital shares for each class were as follows:
Class A Shares for the Dollar
Year Ended August 31, 1999 Shares Amount
Shares sold 8,668,706 $ 114,477,964
Shares issued to shareholders
in reinvestment of dividends
and distributions 133,514 1,615,513
------------- -------------
Total issued 8,802,220 116,093,477
Shares redeemed (3,648,167) (46,305,220)
------------- -------------
Net increase 5,154,053 $ 69,788,257
============= =============
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
NOTES TO FINANCIAL STATEMENTS (concluded)
Class A Shares for the Period
October 31, 1997++ Dollar
to August 31, 1998 Shares Amount
Shares sold 8,733,319 $ 98,620,470
Shares redeemed (1,263,630) (14,666,307)
------------- -------------
Net increase 7,469,689 $ 83,954,163
============= =============
[FN]
++Prior to October 31, 1997 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class B Shares for the Year Dollar
Ended August 31, 1999 Shares Amount
Shares sold 32,351,281 $ 414,963,504
Shares issued to shareholders
in reinvestment of dividends
and distributions 1,533,976 18,484,413
------------- --------------
Total issued 33,885,257 433,447,917
Automatic conversion
of shares (1,103,665) (14,575,473)
Shares redeemed (25,589,693) (323,658,119)
------------- --------------
Net increase 7,191,899 $ 95,214,325
============= ==============
Class B Shares for the Period
October 31, 1997++ to Dollar
August 31, 1998 Shares Amount
Shares sold 129,773,552 $1,359,632,710
Automatic conversion
of shares (286,218) (3,336,866)
Shares redeemed (11,457,608) (129,196,050)
------------- --------------
Net increase 118,029,726 $1,227,099,794
============= ==============
[FN]
++Prior to October 31, 1997 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class C Shares for the Year Dollar
Ended August 31, 1999 Shares Amount
Shares sold 5,729,044 $ 73,383,949
Shares issued to shareholders
in reinvestment of
distributions 291,560 3,513,302
------------- --------------
Total issued 6,020,604 76,897,251
Shares redeemed (6,780,971) (86,031,565)
------------- --------------
Net decrease (760,367) $ (9,134,314)
============= ==============
Class C Shares for the Period
October 31, 1997++ to Dollar
August 31, 1998 Shares Amount
Shares sold 26,547,559 $ 278,291,914
Shares redeemed (3,225,259) (35,955,631)
------------- --------------
Net increase 23,322,300 $ 242,336,283
============= ==============
[FN]
++Prior to October 31, 1997 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
Class D Shares for the Year Dollar
Ended August 31, 1999 Shares Amount
Shares sold 7,767,865 $ 99,878,109
Automatic conversion of shares 1,096,263 14,575,473
Shares issued to shareholders
in reinvestment of dividends
and distributions 350,785 4,240,989
------------- --------------
Total issued 9,214,913 118,694,571
Shares redeemed (6,641,978) (84,163,220)
------------- --------------
Net increase 2,572,935 $ 34,531,351
------------- --------------
Class D Shares for the Period
October 31, 1997++ Dollar
to August 31, 1998 Shares Amount
Shares sold 24,442,157 $ 256,423,360
Automatic conversion of shares 284,885 3,336,866
------------- --------------
Total issued 24,727,042 259,760,226
Shares redeemed (4,989,841) (56,827,050)
------------- --------------
Net increase 19,737,201 $ 202,933,176
============= ==============
[FN]
++Prior to October 31, 1997 (commencement of operations), the Fund
issued 2,500 shares to MLAM for $25,000.
5. Commitments:
At August 31, 1999, the Fund had entered into foreign exchange
contracts under which it had agreed to purchase foreign currency
with an approximate value of $3,878,000.
<AUDIT-REPORT>
REPORT OF INDEPENDENT AUDITORS
To the Shareholders and Board of Directors,
Merrill Lynch Global Growth Fund, Inc.
We have audited the accompanying statement of assets and liabilities
of Merrill Lynch Global Growth Fund, Inc., including the schedule of
investments, as of August 31, 1999, and the related statement of
operations for the year then ended, the statements of changes in net
assets and financial highlights for the year then ended and for the
period from October 31, 1997 (commencement of operations) to August
31, 1998. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is
to express an opinion on these financial statements and financial
highlights based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements
and financial highlights. Our procedures included confirmation of
securities owned as of August 31, 1999 by correspondence with the
custodian and brokers. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of Merrill Lynch Global Growth Fund, Inc. at
August 31, 1999, and the results of its operations and the changes
in its net assets and the financial highlights for the indicated
periods in conformity with generally accepted accounting principles.
Ernst & Young LLP
MetroPark, New Jersey
October 4, 1999
</AUDIT-REPORT>
Merrill Lynch Global Growth Fund, Inc., August 31, 1999
IMPORTANT TAX INFORMATION (unaudited)
The following information summarizes all per share distributions
paid by Merrill Lynch Global Growth Fund, Inc. during its taxable
year ended August 31, 1999:
<TABLE>
<CAPTION>
Qualifying Domestic Foreign Non-Qualifying Total Foreign Taxes
Record Date Payable Date Ordinary Income Source Income Ordinary Income Ordinary Income Paid or Withheld
<S> <C> <C> <C> <C> <C> <C>
Class A Shares:
12/14/98 12/22/98 $.029246 $.078558 $.157989 $.265793 $.013712
Class B Shares:
12/14/98 12/22/98 $.020030 $.053803 $.108203 $.182036 $.013712
Class C Shares:
12/14/98 12/22/98 $.019615 $.052688 $.105962 $.178265 $.013712
Class D Shares:
12/14/98 12/22/98 $.026867 $.072168 $.145138 $.244173 $.013712
</TABLE>
The qualifying ordinary income qualifies for the dividends received
deduction for corporations. Additionally, there were no long-term
capital gains distributions paid by the Fund during the fiscal year.
Please retain this information for your records.
OFFICERS AND DIRECTORS
Terry K. Glenn, President and Director
Donald Cecil, Director
M. Coyler Crum, Director
Edward H. Meyer, Director
Jack B. Sunderland, Director
J. Thomas Touchton, Director
Fred G. Weiss, Director
Arthur Zeikel, Director
Robert C. Doll, Senior Vice President
Lawrence R. Fuller, Senior Vice President
and Portfolio Manager
Donald C. Burke, Vice President and Treasurer
Thomas D. Jones, III, Secretary
Custodian
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
