SEMIANNUAL REPORT
February 28, 1997
INVESCO
GROWTH
FUND,
INC.
A Smart Choice
For Seeking
Steady Capital Growth
INVESCO FUNDS
<PAGE>
Market Overview March 1997
Fueled by a stronger-than-expected economy and improving
corporate earnings, the stock market catapulted to new highs over the last six
months. During the fourth quarter of 1996, the growth rate (as measured by the
Gross Domestic Product) accelerated to a revised level of 3.9%. This surpassed
most analysts' expectations, as the expansion had slowed to a rate of 2.2% in
the previous quarter. The vibrant economy has rekindled fears that tightness in
the labor market could lead to renewed inflation. However, gains in productivity
thus far have offset wage increases and allowed companies to maintain profit
margins without raising prices. This has helped keep inflation under control. In
fact, the consumer price index rose just 0.1% in the month of January (the
smallest gain since June 1996) and finished 1996 at an annualized rate of 3.3%
- -- in line with historical averages.
The U.S. trade gap hit an eight-year high in 1996, primarily driven by a
stronger dollar; this has negative consequences for domestic exporters. As their
products become more expensive in foreign markets, profit margins and future
earnings may decrease. In addition, the phenomenal appreciation of
large-capitalization stocks, predicated on a nearly perfect investment
environment, may have created unwarranted expectations by many investors when
compared to historical averages.
In the middle of March, the investment environment shifted as increased
consumer spending reignited fears of inflation. Consequently, the Federal
Reserve Board increased short-term interest rates by 0.25%. This preemptive
strike against wage and price hikes was the first rate increase in more than two
years, and led to increased negative sentiment in the market, producing a sharp
5% to 10% pullback in many stocks.
A moderate inflation level represents a positive factor for the economy.
At the same time, though, the longevity of the current expansion -- over six
years -- remains a cause for concern; the post-World War II average is only four
and a half years. Negative growth hasn't been experienced since the first
quarter of 1993. If the growth rate does not slow, many economists expect the
Fed to continue raising short-term interest rates, with the concomitant danger
of cutting the expansion short.
INVESCO Growth Fund
Growth Fund
Average Annual Total Return
as of 2/28/97(2)
1 year 22.14%
-----------------------------------------
5 years 12.05%
-----------------------------------------
10 years 11.41%
-----------------------------------------
<PAGE>
The fund significantly outperformed its peers for the one-year period
ended 2/28/97. The fund's total return was 22.14%, which bested the average fund
return of 18.22% as measured by the Lipper Growth Fund objective. For the
six-month period ended 2/28/97, the fund's total return of 15.51% outperformed
the average growth fund return of 15.27% as measured by Lipper Analytical
Services. However, the fund underperformed the unmanaged S&P 500 broad market
index return of 22.52% for the same period. (Lipper Analytical Services, Inc.,
is an independent mutual fund analyst which tracks fund performance unadjusted
for commissions. Of course, past performance is not a guarantee of future
results.)(1),(2)
The line graph below illustrates the growth of the S&P 500 compared to the
value of a $10,000 investment in INVESCO Growth Fund, plus reinvested dividends
and capital gain distributions, for the ten years ended 2/28/97.
Graph:
This line graph represents a comparison of the value of a $10,000
investment in the 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 2/28/97.
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)
Composition of holdings is subject to change.
Strategic Overview
The fund's positive performance over the last six months can be attributed
to two main factors. First, our emphasis has been on building a portfolio that
contains high-quality growth companies that are market leaders, blended with
dynamic growth companies. This strategy enhanced returns as we were exposed to
strong-performing, market-leading stocks like Intel Corp. and Texas Instruments,
while still participating in emerging growth companies like FORE Systems--a firm
that manufactures high performance networking products.
Second, our over-exposure to the health care and technology sectors helped
produce positive returns over the last six months. In the health care sector, we
primarily focused on leading companies in the pharmaceutical industry. In the
technology area, we focused on companies that could benefit from their
proprietary knowledge of software, networking, and semi-conductors.
The one disappointment experienced over the last six months was our
under-exposure to the financial sector, which experienced strong returns in the
fourth quarter of 1996. This was the primary reason for the fund's
underperformance relative to the broad market during the last six months.
Consequently, we have since increased our exposure to the financial sector,
focusing on banks and insurance companies. We feel these industries will
continue to benefit from consolidation and improving margins.
<PAGE>
Looking Forward
We expect 1997 to be a decent year for the domestic market, with returns
approaching historical averages. The market should continue to benefit from
stable interest rates and improving corporate earnings. However, we also
anticipate that investors will remain nervous, and stock markets may experience
extreme volatility on a day-to-day basis. In this environment, stock selectivity
will remain crucial, as we believe that high-quality companies should experience
less volatility than the broad market.
Fund Management
INVESCO Growth Fund is co-managed by Senior Vice President Timothy J.
Miller. He received his MBA from the University of Missouri, and a BSBA from St.
Louis University. A 16-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.
Vice President Trent E. May was named co-manager in October 1996. He
received a BS from the Florida Institute of Technology and his 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.
(1)The S&P 500 is an unmanaged index of common stocks considered representative
of the broad U.S. equity market.
(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
February 28, 1997
Description Value
- ------------------------------------------------------------------------
Philip Morris $29,727,500
BellSouth Corp 26,250,000
FORE Systems 25,962,500
First Bank System 22,765,000
Texas Instruments 21,209,375
BankAmerica Corp 20,475,000
Lucent Technologies 19,395,000
Electronic Arts 18,437,500
Colgate-Palmolive Co 17,595,000
General Electric 17,488,750
Composition of holdings is subject to change.
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Investment Securities
February 28, 1997UNAUDITED
Shares or
Principal
Description Amount Value
- --------------------------------------------------------------------------------
COMMON STOCKS 98.36%
AEROSPACE & DEFENSE 2.53%
Lockheed Martin 195,000 $17,257,500
-------------
BANKS 10.61%
ABN AMRO Holdings NV 210,000 15,074,246
BankAmerica Corp 180,000 20,475,000
Chase Manhattan 140,000 14,017,500
First Bank System 290,000 22,765,000
-------------
72,331,746
-------------
BEVERAGES 3.60%
Coca-Cola Co 230,000 14,030,000
PepsiCo Inc 320,000 10,520,000
-------------
24,550,000
-------------
COMMUNICATONS -
EQUIPMENT & MANUFACTURING 7.44%
Cascade Communications* 508,700 15,706,112
Lucent Technologies 360,000 19,395,000
Motorola Inc 280,000 15,645,000
-------------
50,746,112
-------------
COMPUTER RELATED 16.59%
Cisco Systems* 270,000 15,018,750
Compaq Computer* 200,000 15,850,000
Computer Associates International 150,000 6,525,000
Electronic Arts* 590,000 18,437,500
FORE Systems* 775,000 25,962,500
Micron Electronics* 200,000 3,875,000
Microsoft Corp* 110,000 10,725,000
Oracle Systems 260,000 10,205,000
Remedy Corp* 170,000 6,523,750
-------------
113,122,500
-------------
ELECTRICAL EQUIPMENT 2.57%
General Electric 170,000 17,488,750
-------------
ELECTRONICS 1.02%
General Motors 120,000 6,945,000
-------------
ELECTRONICS - SEMICONDUCTOR 7.83%
Intel Corp 75,000 10,640,625
<PAGE>
Micron Technology 375,000 14,062,500
Texas Instruments 275,000 21,209,375
Xilinx Inc* 165,000 7,445,625
-------------
53,358,125
-------------
ENGINEERING & CONSTRUCTION 0.89%
Fluor Corp 100,000 6,062,500
-------------
HEALTH CARE DRUGS -
PHARMACEUTICALS 11.77%
Bristol-Myers Squibb 85,000 11,092,500
Lilly (Eli) & Co 150,000 13,106,250
Merck & Co 145,000 13,340,000
Rite Aid 350,000 14,743,750
Schering AG 160,000 14,510,132
Warner-Lambert Co 160,000 13,440,000
-------------
80,232,632
-------------
HEALTH CARE RELATED 3.96%
Boston Scientific* 210,000 13,912,500
US Surgical 225,000 9,590,625
United Healthcare 70,000 3,491,250
-------------
26,994,375
-------------
HOUSEHOLD PRODUCTS 3.55%
Colgate-Palmolive Co 170,000 17,595,000
Procter & Gamble 55,000 6,606,875
-------------
24,201,875
-------------
INSURANCE 3.16%
American International Group 55,000 6,655,000
Conseco Inc 380,000 14,915,000
-------------
21,570,000
-------------
OIL & GAS RELATED 5.90%
Amoco Corp 75,000 6,337,500
Enron Corp 250,000 9,968,750
Exxon Corp 70,000 6,991,250
Royal Dutch Petroleum 5 Gldr Shrs 60,000 10,380,000
Schlumberger Ltd 65,000 6,540,625
-------------
40,218,125
-------------
RETAIL 3.59%
Costco Cos* 450,000 11,531,250
Gucci Group NV New York
Registered Shrs 200,000 12,925,000
-------------
24,456,250
-------------
<PAGE>
SERVICES 3.16%
CUC International* 600,000 14,325,000
Service Corp International 250,000 7,250,000
-------------
21,575,000
-------------
TELECOMMUNICATIONS -
LONG DISTANCE 1.02%
AT&T Corp 175,000 6,978,125
-------------
TELEPHONE 4.81%
BellSouth Corp 560,000 26,250,000
GTE Corp 140,000 6,545,000
-------------
32,795,000
-------------
TOBACCO 4.36%
Philip Morris 220,000 29,727,500
-------------
TOTAL COMMON STOCKS
(Cost $612,507,498) 670,611,115
-------------
SHORT-TERM INVESTMENTS -
COMMERCIAL PAPER 1.64%
CONSUMER FINANCE 1.64%
Household Finance
5.402%, 3/3/1997
(Cost $11,210,000) 11,210,000 11,210,000
-------------
TOTAL INVESTMENT SECURITIES
AT VALUE 100.00%
(Cost $623,717,498)
(Cost for Income Tax Purposes
$623,720,472) 681,821,115
=============
* Security is non-income producing.
See Notes to Financial Statement
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Assets and Liabilities
February 28, 1997
UNAUDITED
ASSETS
Investment Securities at Value
(Cost $623,717,498) $681,821,115
Cash 31,862
Receivables:
Investment Securities Sold 14,706,060
Fund Shares Sold 2,520,935
Dividends and Interest 631,201
Prepaid Expenses and Other Assets 103,399
-------------
TOTAL ASSETS 699,814,572
-------------
LIABILITIES
Payables:
Distributions to Shareholders 4,885
Investment Securities Purchased 19,554,864
Fund Shares Repurchased 608,156
Accrued Distribution Expenses 353,851
Accrued Expenses and Other Payable 55,422
-------------
TOTAL LIABILITIES 20,577,178
-------------
Net Assets at Value $679,237,394
=============
NET ASSETS
Paid-in Capital* 546,508,985
Accumulated Distributions in
Excess of Net Investment Income (126,896)
Accumulated Undistributed Net Realized Gain
on Investment Securities 74,751,688
Net Appreciation of Investment Securities 58,103,617
-------------
Net Assets at Value $679,237,394
=============
Net Asset Value, Offering and Redemption
Price per Share $5.47
=============
* The Fund has 200 million authorized shares of common stock, par value of $0.01
per share, of which 124,101,185 were outstanding at February 28, 1997.
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Operations
Six Months Ended February 28, 1997
UNAUDITED
INVESTMENT INCOME
INCOME
Dividends $3,276,693
Interest 703,324
-------------
TOTAL INCOME 3,980,017
-------------
EXPENSES
Investment Advisory Fees 1,928,858
Distribution Expenses 837,370
Transfer Agent Fees 517,439
Administrative Fees 55,283
Custodian Fees and Expenses 70,114
Directors' Fees and Expenses 19,074
Professional Fees and Expenses 26,915
Registration Fees and Expenses 44,409
Reports to Shareholders 54,892
Other Expenses 12,098
-------------
TOTAL EXPENSES 3,566,452
-------------
Fees and Expenses Paid Indirectly (33,823)
-------------
NET EXPENSES 3,532,629
-------------
NET INVESTMENT INCOME 447,388
-------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT SECURITIES
Net Realized Gain on Investment Securities 95,482,572
Change in Net Depreciation of Investment
Securities (2,530,872)
-------------
NET GAIN ON INVESTMENT SECURITIES 92,951,700
-------------
Net Increase in Net Assets from Operations $93,399,088
=============
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Changes in Net Assets
Six Months Year
Ended Ended
February 28 August 31
------------ ------------
1997 1996
UNAUDITED
OPERATIONS
Net Investment Income $447,388 $ 3,536,606
Net Realized Gain on Investment
Securities 95,482,572 111,005,199
Change in Net Depreciation of
Investment Securities (2,530,872) (15,848,975)
------------ ------------
NET INCREASE IN NET
ASSETS FROM OPERATIONS 93,399,088 98,692,830
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income (591,700) (3,514,988)
Net Realized Gain on
Investment Securities (84,754,558) (79,381,324)
------------ ------------
TOTAL DISTRIBUTIONS (85,346,258) (82,896,312)
------------ ------------
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 321,473,844 295,345,551
Reinvestment of Distributions 76,585,541 73,787,554
------------ ------------
398,059,385 369,133,105
Amounts Paid for Repurchases
of Shares (323,600,855) (289,488,892)
------------ ------------
NET INCREASE IN NET
ASSETS FROM FUND SHARE
TRANSACTIONS 74,458,530 79,644,213
------------ ------------
Total Increase in Net Assets 82,511,360 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
($126,896) and $17,416
respectively) $679,237,394 $596,726,034
============ ============
<PAGE>
FUND SHARE TRANSACTIONS
Shares Sold 56,688,865 55,102,359
Shares Issued from Reinvestment
of Distributions 14,768,324 14,849,577
------------ ------------
71,457,189 69,951,936
Shares Repurchased (57,036,473) (54,263,125)
------------ ------------
Net Increase in Fund Shares 14,420,716 15,688,811
============ ============
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
Notes to Financial Statements
UNAUDITED
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. INVESCO Growth
Fund, Inc. (the "Fund") was 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.
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.
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. Interest income, which may be comprised
of stated coupon rate, market discount, original issue discount and
amortized premium is recorded on the accrual basis. Cost is determined on
the specific identification basis.
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.
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.
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 nontaxable dividends, net operating losses and
expired capital loss carryforwards.
<PAGE>
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, Transfer
Agent Fees and Distribution Expenses 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 six months ended February 28, 1997, Fees and Expenses Paid
Indirectly consisted of $32,412 included in Custodian Fees and Expenses,
$1,088 included in Transfer Agent Fees and $323 included in Distribution
Expenses.
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.
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 provides for
reimbursement of marketing and advertising expenditures to IFG (the
"Distributor") to a maximum of 0.25% of average annual net assets. Amounts
accrued by the Fund are available to reimburse the Distributor for actual
expenditures incurred within a rolling twelve-month period. For the six months
ended February 28, 1997, the Fund paid the Distributor $1,462,784 for
reimbursement of expenses incurred. 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. Accordingly, the above amount reflects
reimbursements under the plan for the four months ended December 31, 1996 and
compensation under the plan for the two months ended February 28, 1997.
NOTE 3 - PURCHASES AND SALES OF INVESTMENT SECURITIES. For the six months ended
February 28, 1997, the aggregate cost of purchases and proceeds from sales of
investment securities (excluding all U.S. Government securities and short-term
securities) were $727,255,648 and $694,396,182, respectively.
There were no purchases or sales of U.S. Government securities.
NOTE 4 - APPRECIATION AND DEPRECIATION. At February 28, 1997, the gross
appreciation of securities in which there was an excess of value over tax cost
amounted to $75,589,494 and the gross depreciation of securities in which there
was an excess of tax cost over value amounted to $17,488,851, resulting in net
appreciation of $58,100,643.
<PAGE>
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 are based
on an annual rate of 40% of the retainer fee at the time of retirement.
Pension expenses for the six months ended February 28, 1997, included in
Directors' Fees and Expenses in the Statement of Operations were $5,102.
Unfunded accrued pension costs of $22,258 and pension liability of $43,384 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 of the 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 February 28,
1997, there were no such borrowings.
Other Information
UNAUDITED
On January 31, 1997, a special meeting of the shareholders of the Fund was held
at which the eleven directors identified below were elected, the selection of
Price Waterhouse LLP as independent accountants (Proposal 1), the approval of a
new investment advisory agreement with INVESCO Funds Group, Inc. ("IFG"),
(Proposal 2) and a new sub-advisory agreement between IFG and INVESCO Trust
Company (Proposal 3) were ratified. The following is a report of the votes cast:
Withheld/
Nominee/Proposal For Against Abstain Total
- --------------------------------------------------------------------------------
Charles W. Brady 68,793,480 0 2,134,145 70,927,625
Dan J. Hesser 68,823,341 0 2,104,284 70,927,625
Fred A. Deering 68,761,639 0 2,165,986 70,927,625
Victor L. Andrews 68,840,015 0 2,087,610 70,927,625
Bob R. Baker 68,824,599 0 2,103,026 70,927,625
Lawrence H. Budner 68,836,771 0 2,090,854 70,927,625
Daniel D. Chabris 68,777,628 0 2,149,997 70,927,625
A.D. Frazier, Jr. 68,801,972 0 2,125,653 70,927,625
Hubert L. Harris, Jr. 68,799,621 0 2,128,004 70,927,625
Kenneth T. King 68,778,348 0 2,149,277 70,927,625
John W. McIntyre 68,829,295 0 2,098,330 70,927,625
Proposal 1 67,362,764 885,380 2,679,480 70,927,624
Proposal 2 66,128,587 1,425,176 3,373,861 70,927,624
Proposal 3 65,962,666 1,437,556 3,527,402 70,927,624
<PAGE>
INVESCO Growth Fund, Inc.
Financial Highlights
(For a Fund Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
Six Months
Ended
February 28 Year Ended August 31
------------- -----------------------------------------------------------------------
1997 1996 1995 1994 1993 1992
UNAUDITED
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA
Net Asset Value -
Beginning of Period $ 5.44 $ 5.33 $ 5.34 $ 5.28 $ 4.72 $ 5.26
------------- -----------------------------------------------------------------------
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income 0.01 0.03 0.05 0.03 0.04 0.05
Net Gains on Securities
(Both Realized and
Unrealized) 0.80 0.95 0.49 0.11 1.00 0.05
------------- -----------------------------------------------------------------------
Total from Investment
Operations 0.81 0.98 0.54 0.14 1.04 0.10
------------- -----------------------------------------------------------------------
LESS DISTRIBUTIONS
Dividends from Net
Investment Income+ 0.01 0.03 0.05 0.03 0.04 0.05
Distributions from Capital Gains 0.77 0.84 0.50 0.05 0.44 0.59
------------- -----------------------------------------------------------------------
Total Distributions 0.78 0.87 0.55 0.08 0.48 0.64
------------- -----------------------------------------------------------------------
Net Asset Value -
End of Period $ 5.47 $ 5.44 $ 5.33 $ 5.34 $ 5.28 $ 4.72
============= =======================================================================
TOTAL RETURN 15.51%* 20.23% 12.05% 2.52% 22.17% 2.04%
<PAGE>
RATIOS
Net Assets - End of Period
($000 Omitted) $ 679,237 $596,726 $501,285 $ 488,411 $483,957 $408,218
Ratio of Expenses to Average
Net Assets 0.53%*@ 1.05%@ 1.06% 1.03% 1.04% 1.04%
Ratio of Net Investment Income
to Average Net Assets 0.07%* 0.64% 1.07% 0.47% 0.72% 0.93%
Portfolio Turnover Rate 109%* 207% 111% 63% 77% 77%
Average Commission Rate Paid^^ 0.0639* 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.
* Based on operations for the period shown and, accordingly, are not
representative of a full year.
@ 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 for
fiscal years beginning September 1, 1995 and thereafter.
<PAGE>
Graph: Quarterly Change in GDP
This bar graph illustrates the growth rate for the Gross Domestic Product,
for the period from the third quarter of 1994 through the last quarter of
1996.
<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
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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
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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 N/A
Cash Reserves 25 FDSXX N/A
Tax-Free Money Fund 40 FFRXX N/A
* 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
We're so easy to stay in touch with:
Investor Services Representatives,
1-800-525-8085
PAL(R), your Personal Account Line,
1-800-424-8085
On the World Wide Web:
http://www.invesco.com
Denver Investor Centers:
Cherry Creek, 155-B Fillmore Street;
Denver Tech Center, 7800 E. Union
Avenue, Lobby Level
INVESCO Funds Group, Inc.,(SM) Distributor
Post Office Box 173706
Denver, Colorado 80217-3706
This information must be preceded or accompanied by a current prospectus.
