Annual Report
August 31, 1997
INVESCO GROWTH FUND
A smart choice for seeking steady capital growth.
INVESCO FUNDS
<PAGE>
MARKET OVERVIEW September 1997
U.S. financial markets are highly dependent on investors' perception of the
domestic economy. This has been especially true this year. In the early spring,
fears of inflation and the potential for an overheating economy caused the
Federal Reserve Board to increase short-term interest rates by 25 basis points.
This produced a sharp pullback in the stock market. Subsequently, the prevailing
view had been of strong and stable economic growth with benign inflation. With
this change of attitude, equity markets rallied, and many large-capitalization
indexes produced 20% gains within a two-month time period. In fact, the Dow
Jones Industrial Average jumped 20% in two months for only the third time in 59
years. Recently, however, renewed concerns over inflation, corporate profits,
and a stronger-than-expected economy have again increased day-to-day volatility
within the equity markets.(1)
Why has the economy been so difficult to gauge?
Conventional wisdom has always held that strong economic growth and benign
inflation couldn't coexist. However, for the last seven months, they have. Some
analysts are calling the current economic environment a "new paradigm" or a
"utopian environment." The Gross Domestic Product (GDP) -- the primary indicator
of economic status -- continues to increase at a rapid pace. In the fourth
quarter of 1996, the GDP rose at a revised rate of 3.9%; for the first quarter
of 1997, 4.9%; and for the second quarter of 1997, 3.3%.
Meanwhile, the specter of inflation has been nonexistent. Wholesale prices
across the economy decreased for the first seven months of 1997, yet the
unemployment rate measured 4.9% in August and 4.8% in July -- the lowest levels
since 1973.
Whatever your outlook on the economy, the current environment bodes well
for domestic equity markets. Low inflation with strong economic growth may
continue to lead to high multiples for corporate stock prices, albeit with
likely price volatility. Of course, a significant increase in interest rates
could alter the current market conditions and change the investment climate.
INVESCO GROWTH FUND
Growth Fund
Average Annual Total Return
as of 8/31/97 (2)
1 Year 28.14%
---------------------------
5 Years 16.68%
---------------------------
10 Years 11.36%
---------------------------
The fund's one-year total return as of 8/31/97 was 28.14%, compared to the
one-year figure of 40.57% for the S&P 500 broad market index.(1),(2)
The fund's underperformance was primarily due to our aggressive posture at
the beginning of 1997, which left the portfolio vulnerable when the market
corrected in the spring of this year. We remain confident, however, that our
investment style should produce superior returns over the full market cycle.
The following line graph illustrates the growth of the S&P 500 compared to
the value of a $10,000 investment in INVESCO Growth Fund, plus reinvested
<PAGE>
dividends and capital gain distributions, for the 10 years ended 8/31/97. The
chart and other total return figures cited reflect the fund's operating
expenses. However, the index does not have expenses, which would, of course,
have lowered its performance(2)
Graph: This line graph represents a comparison of the value of a $10,000
investment in INVESCO Growth Fund to the value of a $10,000 investment in the
S&P 500 Index, assuming in each case reinvestment of all dividends and capital
gain distributions, for the ten year period ended 8/31/97.
STRATEGIC OVERVIEW
Large-capitalization growth stocks continued to lead the domestic equity
markets over the last year. Within this environment, fund management has stayed
true to our investment philosophy of focusing the fund's core holdings on
classic growth companies like Coca-Cola Co., General Electric, Microsoft Corp.,
and Pfizer Inc. While we remain exposed to some faster-growing companies, we
favor the predictability of earnings associated with large-cap growth companies
for the foundation of the portfolio.
The health care and technology sectors produced strong returns for the
fund during the past 12 months, and we will continue to seek opportunities in
these faster-growing sectors. In the health care sector, gains were produced by
market-leading pharmaceuticals like Johnson & Johnson, Merck & Co., and Pfizer
Inc. These pharmaceutical companies continue to benefit from an improved
regulatory environment and the introduction of new products to the market.
On the technology side, our exposure to large, dependable growth companies
like International Business Machines (IBM) and Microsoft Corp. boosted
performance. These firms continue to benefit from dominant positions in their
respective markets.
LOOKING FORWARD
The current economic environment bodes well for domestic equity markets.
Low inflation and strong economic growth may continue to lead to improved
corporate earnings, fueling price appreciation. We have recently, however,
reduced the number of stocks in the portfolio. In this way, we should be better
able to monitor individual holdings, as we feel that stock selectivity is
growing in importance.
One minor area of concern is the recent currency turmoil in Southeast
Asia. Many large-cap growth companies derive a significant portion of their
revenues from the Asia/Pacific Rim economies. Weak Asian currencies and slowing
economic growth rates could make U.S. goods less attractive overseas, and
potentially hurt the earnings of large-cap companies. Consequently, we will
continue to monitor this area closely.
FUND MANAGEMENT
INVESCO Growth Fund is managed by Senior Vice President Timothy J. Miller.
He received his MBA from the University of Missouri, and a BSBA from St. Louis
University. An 18-year veteran of the investment business, he is a Chartered
Financial Analyst. Before joining INVESCO in 1992, Tim was an analyst and
portfolio manager with Mississippi Valley Advisors.
Trent E. May was named co-manager in 1996. He received a BS from the
Florida Institute of Technology and an MBA from Rollins College. Before joining
INVESCO in 1996, Trent was a senior equity manager/equity analyst with Munder
Capital Management. He is a Chartered Financial Analyst.
<PAGE>
(1) The S&P 500 is an unmanaged index of common stocks considered representative
of the broad U.S. equity market, while the Dow Jones Industrial Average reflects
performance of large-capitalization stocks.
(2) Total return assumes reinvestment of dividends and capital gain
distributions for the periods indicated. Past performance is not a guarantee of
future results. Investment return and principal value will fluctuate so that,
when redeemed, an investor's shares may be worth more or less than when
purchased.
<PAGE>
INVESCO Growth Fund, Inc.
TEN LARGEST COMMON STOCK HOLDINGS
August 31, 1997
Description Value
- ---------------------------------------------------------------------
PepsiCo Inc $ 30,960,000
Pfizer Inc 30,267,975
General Electric 29,375,000
Philip Morris 29,228,750
Johnson & Johnson 29,194,063
American International Group 29,020,312
Coca-Cola Co 28,942,812
Merck & Co 28,920,938
Bristol-Myers Squibb 28,880,000
SBC Communications 28,818,750
Composition of holdings is subject to change.
<PAGE>
INVESCO Growth Fund, Inc.
STATEMENT OF INVESTMENT SECURITIES
August 31, 1997
<TABLE>
<CAPTION>
Shares or
Principal
Description Amount Value
- ---------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS 100.00%
BANKS 5.90%
BankAmerica Corp 110,000 $ 7,239,375
Chase Manhattan 65,000 7,227,187
Citicorp 215,000 27,439,375
---------------
41,905,937
---------------
BEVERAGES 8.44%
Coca-Cola Co 505,000 28,942,812
PepsiCo Inc 860,000 30,960,000
---------------
59,902,812
---------------
CHEMICALS 3.95%
du Pont (E I) de Nemours 450,000 28,040,625
---------------
COMMUNICATIONS -
EQUIPMENT & MANUFACTURING 0.57%
Motorola Inc 55,000 4,035,625
---------------
COMPUTER RELATED 15.18%
Bay Networks* 600,000 21,225,000
Compaq Computer* 25,000 1,637,500
Hewlett-Packard Co 460,000 28,203,750
International Business Machines 280,000 28,245,000
Microsoft Corp* 215,000 28,420,313
---------------
107,731,563
---------------
CONSUMER FINANCE 0.55%
American Express 50,000 3,887,500
---------------
ELECTRICAL EQUIPMENT 4.14%
General Electric 470,000 29,375,000
---------------
<PAGE>
ELECTRONICS -
SEMICONDUCTOR 4.76%
Maxim Integrated Products* 275,000 19,009,375
National Semiconductor* 230,000 7,877,500
Xilinx Inc* 145,000 6,887,500
---------------
33,774,375
---------------
ENTERTAINMENT 3.15%
Disney (Walt) Co 140,000 10,753,750
Time Warner 225,000 11,587,500
---------------
22,341,250
---------------
FINANCIAL 1.64%
Federal National Mortgage Association 265,000 11,660,000
---------------
HEALTH CARE DRUGS -
PHARMACEUTICALS 18.04%
Bristol-Myers Squibb 380,000 28,880,000
Johnson & Johnson 515,000 29,194,063
Merck & Co 315,000 28,920,938
Pfizer Inc 546,600 30,267,975
SmithKline Beecham PLC ADR
Representing 5 Ord A Shrs 250,000 10,828,125
---------------
128,091,101
---------------
HEALTH CARE RELATED 0.57%
Tenet Healthcare* 150,000 4,087,500
---------------
HOUSEHOLD PRODUCTS 3.14%
Colgate-Palmolive Co 271,000 17,005,250
Procter & Gamble 40,000 5,322,500
---------------
22,327,750
---------------
INSURANCE 4.09%
American International Group 307,500 29,020,312
---------------
<PAGE>
OIL & GAS RELATED 9.93%
Exxon Corp 460,000 28,146,250
Mobil Corp 95,000 6,911,250
Royal Dutch Petroleum
New York Registry 1.25 Gldr Shr 555,000 28,166,250
Schlumberger Ltd 95,000 7,237,813
---------------
70,461,563
---------------
PERSONAL CARE 2.28%
Avon Products 175,000 11,210,937
Gillette Co 60,000 4,968,750
---------------
16,179,687
---------------
RESTAURANTS 0.53%
McDonald's Corp 80,000 3,785,000
---------------
RETAIL 4.00%
Wal-Mart Stores 800,000 28,400,000
---------------
TELECOMMUNICATIONS -
LONG DISTANCE 0.96%
AT&T Corp 175,000 6,825,000
---------------
TELEPHONE 4.06%
SBC Communications 530,000 28,818,750
---------------
TOBACCO 4.12%
Philip Morris 670,000 29,228,750
---------------
TOTAL INVESTMENT
SECURITIES AT VALUE 100.00%
(Cost $672,489,569)
(Cost for Income Tax Purposes
$672,571,263) $ 709,880,100
===============
* Security is non-income producing.
See Notes to Financial Statements
</TABLE>
<PAGE>
INVESCO Growth Fund, Inc.
STATEMENT OF ASSETS AND LIABILITIES
August 31, 1997
ASSETS
Investment Securities at Value
(Cost $672,489,569) $709,880,100
Cash 140,385
Receivables:
Investment Securities Sold 22,016,720
Fund Shares Sold 460,757
Dividends 788,998
Prepaid Expenses and Other Assets 94,246
--------------
TOTAL ASSETS 733,381,206
--------------
LIABILITIES
Payables:
Distributions to Shareholders 102,293
Investment Securities Purchased 23,036,148
Fund Shares Repurchased 823,681
Accrued Distribution Expenses 159,759
Accrued Expenses and Other Payables 38,870
--------------
TOTAL LIABILITIES 24,160,751
--------------
Net Assets at Value 709,220,455
==============
NET ASSETS
Paid-in Capital* 506,691,202
Accumulated Distributions in Excess of
Net Investment Income (24,778)
Accumulated Undistributed Net Realized Gain
on Investment Securities and Foreign Currency
Transactions 165,163,500
Net Appreciation of Investment Securities and
Foreign Currency Transactions 37,390,531
--------------
Net Assets at Value $ 709,220,455
==============
Net Asset Value, Offering and Redemption
Price per Share 6.06
=======
* The Fund has 200 million authorized shares of common stock, par value of
$0.01 per share, of which 117,112,178 were outstanding at August 31, 1997.
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
STATEMENT OF OPERATIONS
Year Ended August 31, 1997
INVESTMENT INCOME
INCOME
Dividends $8,006,006
Interest 857,195
Foreign Taxes Withheld (34,666)
--------------
TOTAL INCOME 8,828,535
--------------
EXPENSES
Investment Advisory Fees 3,922,981
Distribution Fees and Expenses 1,706,756
Transfer Agent Fees 1,066,438
Administrative Fees 112,386
Custodian Fees and Expenses 131,329
Directors' Fees and Expenses 38,040
Professional Fees and Expenses 52,240
Registration Fees and Expenses 105,016
Reports to Shareholders 120,595
Other Expenses 37,492
--------------
TOTAL EXPENSES 7,293,273
Fees and Expenses Paid Indirectly (48,910)
--------------
NET EXPENSES 7,244,363
--------------
NET INVESTMENT INCOME 1,584,172
--------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT SECURITIES
Net Realized Gain on Investment Securities
and Foreign Currency Transactions 185,903,395
Change in Net Appreciation of Investment
Securities and Foreign Currency Transactions (23,243,958)
--------------
NET GAIN ON INVESTMENT SECURITIES 162,659,437
--------------
Net Increase in Net Assets from Operations $ 164,243,609
==============
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended August 31
------------------------------------
1997 1996
<S> <C> <C>
OPERATIONS
Net Investment Income $ 1,584,172 $ 3,536,606
Net Realized Gain on Investment
Securities and Foreign Currency
Transactions 185,903,395 111,005,199
Change in Net Appreciation of
Investment Securities and
Foreign Currency Transactions (23,243,958) (15,848,975)
------------------------------------
NET INCREASE IN NET
ASSETS FROM OPERATIONS 164,243,609 98,692,830
------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS
Net Investment Income (1,500,483) (3,514,988)
Net Realized Gain on
Investment Securities (84,751,427) (79,381,324)
------------------------------------
TOTAL DISTRIBUTIONS (86,251,910) (82,896,312)
------------------------------------
FUND SHARE
TRANSACTIONS
Proceeds from Sales of Shares 647,469,283 295,345,551
Reinvestment of Distributions 77,405,695 73,787,554
------------------------------------
724,874,978 369,133,105
Amounts Paid for Repurchase
of Shares (690,372,256) (289,488,892)
------------------------------------
NET INCREASE IN
NET ASSETS FROM FUND
SHARE TRANSACTIONS 34,502,722 79,644,213
------------------------------------
Total Increase in Net Assets 112,494,421 95,440,731
NET ASSETS
Beginning of Period 596,726,034 501,285,303
End of Period (Including
Accumulated Undistributed
(Distributions in Excess of)
Net Investment Income of
($24,778) and $17,416
respectively) $ 709,220,455 $ 596,726,034
====================================
---------------------------------------------------------
<PAGE>
FUND SHARE TRANSACTIONS
Shares Sold 113,639,331 55,102,359
Shares Issued from Reinvestment
of Distributions 14,903,327 14,849,577
------------------------------------
128,542,658 69,951,936
Shares Repurchased (121,110,949) (54,263,125)
------------------------------------
Net Increase in Fund Shares 7,431,709 15,688,811
====================================
</TABLE>
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
Notes to Financial Statements
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. INVESCO Growth Fund,
Inc. (the "Fund"), is incorporated in Maryland. The investment objective of the
Fund is to seek long-term capital growth. The Fund is registered under the
Investment Company Act of 1940 (the "Act") as a diversified, open-end management
investment company.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
A. SECURITY VALUATION - Equity securities traded on national securities
exchanges or in the over-the-counter market are valued at the last sales
price in the market where such securities are primarily traded. If last
sales prices are not available, securities are valued at the highest
closing bid price obtained from one or more dealers making a market for
such securities or by a pricing service approved by the Fund's board of
directors.
Foreign securities are valued at the closing price on the principal
stock exchange on which they are traded. In the event that closing prices
are not available for foreign securities, prices will be obtained from the
principal stock exchange at or prior to the close of the New York Stock
Exchange. Foreign currency exchange rates are determined daily prior to the
close of the New York Stock Exchange.
If market quotations or pricing service valuations are not readily
available, securities are valued at fair value as determined in good faith
by the Fund's board of directors.
Short-term securities are stated at amortized cost (which approximates
market value) if maturity is 60 days or less at the time of purchase, or
market value if maturity is greater than 60 days.
Assets and liabilities initially expressed in terms of foreign
currencies are translated into U.S. dollars at the prevailing market rates
as quoted by one or more banks or dealers on the date of valuation. The cost
of securities is translated into U.S. dollars at the rates of exchange
prevailing when such securities are acquired. Income and expenses are
translated into U.S. dollars at the rates of exchange prevailing when
accrued.
B. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME - Security transactions
are accounted for on the trade date and dividend income is recorded on the
ex dividend date. Certain dividends from foreign securities will be recorded
as soon as the Fund is informed of the dividend if such information is
obtained subsequent to the ex dividend date. Interest income, which may be
comprised of stated coupon rate, market discount, amortized premium, and
original issue discount, is recorded on the accrual basis. Cost is
determined on the specific identification basis.
The Fund's use of short-term forward foreign currency contracts may
subject it to certain risks as a result of unanticipated movements in
foreign exchange rates. The Fund does not hold short-term forward foreign
currency contracts for trading purposes.
<PAGE>
C. FEDERAL AND STATE TAXES - The Fund has complied, and continues to comply,
with the provisions of the Internal Revenue Code applicable to regulated
investment companies and, accordingly, has made or intends to make
sufficient distributions of net investment income and net realized capital
gains, if any, to relieve it from all federal and state income taxes and
federal excise taxes.
To the extent future capital gains are offset by capital loss
carryovers, such gains will not be distributed to shareholders.
Dividends paid by the Fund from net investment income and distributions
of net realized short-term capital gains are, for federal income tax
purposes, taxable as ordinary income to shareholders. Of the ordinary income
distributions declared for the year ended August 31, 1997, 2.97% qualified
for the dividends received deduction available to the Fund's corporate
shareholders.
Investment income received from foreign sources may be subject to
foreign withholding taxes. Dividend and interest income is shown gross of
foreign withholding taxes in the accompanying financial statements.
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions to
shareholders are recorded by the Fund on the ex dividend/distribution date.
The Fund distributes net realized capital gains, if any, to its
shareholders at least annually, if not offset by capital loss carryovers.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles. These differences are primarily due to
differing treatments for foreign currency transactions, nontaxable
dividends, net operating losses and expired capital loss carryforwards. For
the year ended August 31, 1997, the Fund reclassified $138,025 from
accumulated undistributed net investment income to paid-in capital and
reclassified $12,142 from accumulated undistributed net realized gain on
investment securities to accumulated undistributed net investment income.
Net investment income, net realized gains and net assets were not affected.
E. EXPENSES - Under an agreement between the Fund and the Fund's Custodian,
agreed upon Custodian Fees and Expenses are reduced by credits granted by
the Custodian from any temporarily uninvested cash. Similarly, Distribution
Expenses and Transfer Agent Fees, are reduced by credits earned by the Fund
from security brokerage transactions under certain broker/service
arrangements with third parties. Such credits are included in Fees and
Expenses Paid Indirectly in the Statement of Operations.
For the year ended August 31, 1997, Fees and Expenses Paid Indirectly
consisted of $47,462 included in Custodian Fees and Expenses and $323
included in Distribution Expenses, and $1,125 included in Transfer Agent
Fees.
NOTE 2 - INVESTMENT ADVISORY AND OTHER AGREEMENTS. INVESCO Funds Group, Inc.
("IFG") serves as the Fund's investment adviser. As compensation for its
services to the Fund, IFG receives an investment advisory fee which is accrued
daily at the applicable rate and paid monthly. The fee is based on the annual
rate of 0.60% on the first $350 million of average net assets; reduced to 0.55%
on the next $350 million of average net assets; and 0.50% on average net assets
in excess of $700 million.
In accordance with a Sub-Advisory Agreement between IFG and INVESCO Trust
Company ("ITC"), a wholly owned subsidiary of IFG, investment decisions of the
Fund are made by ITC. Fees for such sub-advisory services are paid by IFG.
<PAGE>
In accordance with an Administrative Agreement, the Fund pays IFG an annual
fee of $10,000, plus an additional amount computed at an annual rate of 0.015%
of average net assets to provide administrative, accounting and clerical
services. The fee is accrued daily and paid monthly.
IFG receives a transfer agent fee at an annual rate of $20.00 per
shareholder account, or, where applicable, per participant in an omnibus
account, per year. IFG may pay such fee for participants in omnibus accounts to
affiliates or third parties. The fee is paid monthly at one-twelfth of the
annual fee and is based upon the actual number of accounts in existence during
each month.
A plan of distribution pursuant to Rule 12b-1 of the Act provided for
reimbursement of marketing and advertising expenditures to IFG (the
"Distributor") to a maximum of 0.25% of average annual net assets. Effective
January 1, 1997, the Rule 12b-1 distribution plan was modified by action of the
Board of Directors so that the Fund compensates IFG for permissable activities
and services in connection with the distribution of the Fund's shares. For the
year ended August 31, 1997, the Fund paid the Distributor $2,526,261 under the
plan of distribution. Accordingly, the above amounts reflect reimbursements
under the plan for the four months ended December 31, 1996 and compensation
under the plan for the eight months ended August 31, 1997. Effective September
29,1997, INVESCO Distributors, Inc., a wholly owned subsidiary of IFG, will
replace IFG, as Distributor.
NOTE 3 - PURCHASES AND SALES OF INVESTMENT SECURITIES. For the year ended
August 31, 1997, the aggregate cost of purchases and proceeds from sales of
investment securities (excluding all U.S. Government securities and short-term
securities) were $1,893,969,801and $1,891,550,581, respectively.
There were no purchases or sales of U.S. Government securities.
NOTE 4 - APPRECIATION AND DEPRECIATION. At August 31, 1997, the gross
appreciation of securities in which there was an excess of value over tax cost
amounted to $48,852,349 and the gross depreciation of securities in which there
was an excess of tax cost over value amounted to $11,543,512, resulting in net
appreciation of $37,308,837.
NOTE 5 - TRANSACTIONS WITH AFFILIATES. Certain of the Fund's officers and
directors are also officers and directors of IFG or ITC.
The Fund has adopted an unfunded deferred compensation plan covering all
independent directors of the Fund who will have served as an independent
director for at least five years at the time of retirement. Benefits under this
plan were based on an annual rate equal to 40% of the retainer fee at the time
of retirement.
Pension expenses for the year ended August 31, 1997, included in Directors'
Fees and Expenses in the Statement of Operations were $8,754. Unfunded accrued
pension costs of $22,258 and pension liability of $47,036 are included in
Prepaid Expenses and Accrued Expenses, respectively, in the Statement of Assets
and Liabilities.
NOTE 6 - LINE OF CREDIT. The Fund has available a Redemption Line of Credit
Facility ("LOC"), from a consortium of national banks, to be used for temporary
or emergency purposes to fund redemptions of investor shares. The LOC permits
borrowings to a maximum of 5% of the Net Assets at Value of the Fund. The
Fund agrees to pay annual fees and interest on the unpaid principal balance
based on prevailing market rates as defined in the agreement. At August 31,
1997, there were no such borrowings.
<PAGE>
INVESCO Growth Fund, Inc.
FINANCIAL HIGHLIGHTS
(For a Fund Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
Year Ended August 31
----------------------------------------------------------------------
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
PER SHARE DATA
Net Asset Value - Beginning of Period $ 5.44 $ 5.33 $ 5.34 $ 5.28 $ 4.72
----------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.01 0.03 0.05 0.03 0.04
Net Gains on Securities
(Both Realized and Unrealized) 1.39 0.95 0.49 0.11 1.00
----------------------------------------------------------------------
Total from Investment Operations 1.40 0.98 0.54 0.14 1.04
----------------------------------------------------------------------
LESS DISTRIBUTIONS
Dividends from Net Investment Income+ 0.01 0.03 0.05 0.03 0.04
Distributions from Capital Gains 0.77 0.84 0.50 0.05 0.44
----------------------------------------------------------------------
Total Distributions 0.78 0.87 0.55 0.08 0.48
======================================================================
Net Asset Value - End of Period $ 6.06 $ 5.44 $ 5.33 $ 5.34 $ 5.28
======================================================================
TOTAL RETURN 28.14% 20.23% 12.05% 2.52% 22.17%
RATIOS
Net Assets - End of Period
($000 Omitted) $709,220 $596,726 $501,285 $488,411 $483,957
Ratio of Expenses to Average
Net Assets 1.07%@ 1.05%@ 1.06% 1.03% 1.04%
Ratio of Net Investment Income to
Average Net Assets 0.22% 0.64% 1.07% 0.47% 0.72%
Portfolio Turnover Rate 286% 207% 111% 63% 77%
Average Commission Rate Paid^^ $ 0.0697 $ 0.0286 - - -
</TABLE>
+ Distributions in excess of net investment income for the year ended August 31,
1995, aggregated less than $0.01 on a per share basis.
@ Ratio is based on Total Expenses of the Fund, which is before any expense
offset arrangements.
^^ The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the total
number of related shares purchased or sold which is required to be disclosed
effective for fiscal years beginning September 1, 1995 and thereafter.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors of
INVESCO Growth Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the statement of investment securities, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of INVESCO Growth Fund, Inc. (the
"Fund") at August 31,1997, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the five years in the period
then ended, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at August
31, 1997 by correspondence with the custodian and the application of alternative
auditing procedures where securities purchased had not been received, provide a
reasonable basis for the opinion expressed above.
Price Waterhouse LLP
Denver, Colorado
October 8, 1997
<PAGE>
FAMILY OF FUNDS
Newspaper
Fund Name Fund Code Ticker Symbol Abbreviation
- --------------------------------------------------------------------------------
International
International Growth 49 FSIGX IntlGr
Asian Growth 41 IVAGX AsianGr
European 56 FEURX Europ
European Small Company 37 IVECX EuroSmCo
Latin American Growth 34 IVSLX LatinAmGr
Pacific Basin 54 FPBSX PcBas
- --------------------------------------------------------------------------------
Sector
Energy 50 FSTEX Enrgy
Environmental Services 59 FSEVX Envirn
Financial Services 57 FSFSX FinSvc
Gold 51 FGLDX Gold
Health Sciences 52 FHLSX HlthSc
Leisure 53 FLISX Leisur
Realty 42 IVSRX Realty
Technology 55 FTCHX Tech
Utilities 58 FSTUX Util
Worldwide Capital Goods 38 ISWGX WldCap
Worldwide Communications 39 ISWCX WldCom
- --------------------------------------------------------------------------------
Capital Appreciation
Growth 10 FLRFX Grwth
Dynamics 20 FIDYX Dynm
Small Company 74 IDSCX DivSmCo
Emerging Growth 60 FIEGX Emgrth
- --------------------------------------------------------------------------------
Growth & Income
Industrial Income 15 FIIIX IndInc
Value Equity 46 FSEQX ValEq
Multi-Asset Allocation 70 IMAAX MulAstAl
Balanced 71 IMABX Bal
Total Return 48 FSFLX TotRtn
- --------------------------------------------------------------------------------
Bond
Short-Term Bond 33 INIBX ShTrBd
Intermediate Government Bond 47 FIGBX IntGov
U.S. Government Securities 32 FBDGX USGvt
Select Income 30 FBDSX SelInc
High Yield 31 FHYPX HiYld
- --------------------------------------------------------------------------------
Tax-Exempt
Tax-Free Intermediate Bond 36 IVTIX *
Tax-Free Long-Term Bond 35 FTIFX TxFre
- --------------------------------------------------------------------------------
Money Market
U.S. Government Money Fund 44 FUGXX InvGvtMF
Cash Reserves 25 FDSXX InvCshR
Tax-Free Money Fund 40 FFRXX InvTaxFree
<PAGE>
* This fund does not meet size requirements to be assigned a ticker symbol in
newspaper listings.
For more information about any of the INVESCO Funds, including management fees
and expenses, please call us at 1-800-525-8085 for a prospectus. Read it
carefully before you invest or send money.
<PAGE>
INVESCO FUNDS
INVESCO Distributors, Inc., (SM)
Distributor (formerly INVESCO
Funds Group, Inc., Distributor)
Post Office Box 173706
Denver, CO 80217-3706
1-800-525-8085
PAL(R): 1-800-424-8085
http://www.invesco.com
If you're in Denver, visit one of our
convenient Investor Centers:
Cherry Creek,
155-B Fillmore Street
Denver Tech Center,
7800 East Union Avenue,
Lobby Level
