Semiannual Report
February 28, 1998
INVESCO GROWTH FUND
You should know what INVESCO knows.
INVESCO FUNDS
<PAGE>
Market Overview March 1998
Like a great prize fighter, it appears that the U.S. economy has taken Asia's
best punch and continues to fight. At the beginning of the Asian financial
crisis, in the summer of 1997, investment professionals postulated that Asian
currency problems were "isolated," and would have little effect on the U.S.
economy. Then, as the contagion spread, market pundits theorized that the crisis
would derail economic growth in the U.S. and possibly devastate most of the
world's financial markets -- wrong again. As with most financial crises,
speculation on the length and severity of the situation varies from extreme
pessimism to extreme optimism, with the truth usually between the two.
Over the last six months, this uncertainty increased volatility in the
equity markets -- producing both the first market correction in more than seven
years and record highs for most indexes. However, as fears of deflation swept
through the economy, fixed-income markets experienced a significant rally, with
high-quality obligations realizing the strongest returns. With so much
uncertainty regarding the direction of the U.S. economy, it's important to
examine the known facts:
- The U.S. economy is still the dominant economy in the world. GDP (Gross
Domestic Product) grew 3.8% last year -- the fastest rate since 1988.
- U.S. exports to the Asian/Pacific Rim region are relatively minimal,
currently representing less than 15% of our total exports.
- Inflation remains subdued, as both consumer and producer prices remain
stable.
- Consumer confidence is at its highest level in more than 27 years.
- Unemployment is at historically low levels, and real wages are starting to
increase.
- The chronic U.S. budget deficit might become a surplus in the next few
years.
It appears that the domestic economy is still poised for growth with benign
inflation. Although the Asian financial crisis will influence the profitability
of certain industries, it will probably have only a minor effect on the U.S.
expansion, as consumer demand remains strong here and in Europe. In fact, the
crisis may have been a positive for the U.S, as it applied the brakes to an
exuberant economy before it had the chance to overheat. Plus, the crisis may
create necessary reforms in Asian economies which could allow for greater global
competition. Nonetheless, 1998 may be a more selective stock market with greater
volatility compared to the last three years.
For fixed-income investors, deflationary pressures produced by the Asian
crisis should keep both consumer and producer prices in check as cheaper foreign
goods flood the U.S. markets. This may keep the Federal Reserve Board from
changing the interest rate environment until the crisis has washed through the
U.S. economy. The one possible inflationary pressure remains increasing real
wages, given low unemployment rates. Nevertheless, the overall outlook for the
fixed-income markets continues to be positive.
<PAGE>
INVESCO Growth Fund
INVESCO Growth Fund
Average Annual Total Return as of 2/28/98 (2)
---------------------------------------------
1 Year 31.18%
---------------------------------------------
5 Years 18.02%
---------------------------------------------
10 Years 15.93%
---------------------------------------------
For the six-month period ended 2/28/98, INVESCO Growth Fund achieved a total
return of 18.25%, compared to the six-month figure of 17.62% for the S&P 500.(1)
(2) The line graph on the previous page illustrates the growth of the S&P 500
Index compared to the value of a $10,000 investment in INVESCO Growth Fund,
plus reinvested dividends and capital gain distributions, for the 10 years ended
2/28/98. 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. (1),(2)
Graph:
This line graph compares 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 February 28, 1998.
<PAGE>
Strategic Overview
The fund continues to invest a core portion of the portfolio in high
quality, large-capitalization growth companies. These firms are market leaders
and have historically delivered predictable and consistent earnings over the
business cycle. For the remaining holdings, we seek to identify companies with
leading positions which serve attractive growth markets and which have the
potential for superior financial returns. This strategy produces a portfolio
that combines premier stable growth companies with faster-growing firms in the
communications, technology, and health care sectors.
In the summer of 1997, we reduced the overall number of securities in the
portfolio, making the fund somewhat more concentrated in large-cap growth
stocks. This action was based on the belief that, in an uncertain market
environment, predictability of earnings would be crucial. While past performance
is no guarantee of future results, our intensified focus paid off for the fund
as large-cap growth companies produced strong returns during the last six
volatile months. Colgate-Palmolive Co., Merck & Co., and Fannie Mae are examples
of large-cap stocks which provided healthy results for the fund and remain core
holdings. (Holdings and composition of holdings are subject to change.) In
regard to faster-growing firms serving attractive growth markets, we have
avoided companies that derive a significant portion of their revenues from Asian
markets. We focused instead on institutions that could benefit from the strong
domestic economy. For instance, we believe that deregulation of the
telecommunications industry has created enormous growth opportunities for
selected telecommunications companies, and WorldCom Inc. remains one of our
favorite stocks. The fund will continue to look for the best investments in
communications industries, as well as the health care and technology sectors.
Looking Forward
We believe that 1998 will be a year of slower earnings growth and more
volatile equity markets. Within this environment, predictability of earnings
will remain critical as any earnings disappointments will be negatively dealt
with by the market. Thus, we will continue to allocate a substantial portion of
the fund's assets to large-cap growth companies.
Fund Management
INVESCO Growth Fund is managed by Vice President Trent E. May. He received
a BS from the Florida Institute of Technology and a 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.
Senior Vice President Timothy J. Miller is co-manager of the fund. 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.
(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>
<TABLE>
<CAPTION>
INVESCO Growth Fund, Inc.
Ten Largest Common Stock Holdings
February 28, 1998
Description Value
- --------------------------------------------------------------------------------------------
<S> <C>
Wal-Mart Stores $ 33,622,875
Ford Motor 33,258,750
Johnson & Johnson 32,646,200
Disney (Walt) Co 32,103,675
Fannie Mae 31,906,250
American International Group 31,248,750
Merck & Co 30,729,806
Hewlett-Packard Co 30,424,700
Procter & Gamble 30,322,688
Bristol-Myers Squibb 30,216,550
Composition of holdings is subject to change.
</TABLE>
<TABLE>
<CAPTION>
INVESCO Growth Fund, Inc.
Statement of Investment Securities
February 28, 1998
UNAUDITED
- --------------------------------------------------------------------------------------------
Shares or
Principal
Description Amount Value
- --------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS 99.79%
AUTOMOBILES 3.99%
Ford Motor 588,000 $ 33,258,750
------------
BANKS 1.02%
BankAmerica Corp 109,900 8,517,250
------------
BEVERAGES 3.49%
Coca-Cola Co 424,000 29,123,500
------------
CHEMICALS 3.54%
du Pont (E I) de Nemours+ 482,000 29,552,625
------------
COMPUTER RELATED 11.58%
HNC Software* 218,130 7,770,881
Hewlett-Packard Co 454,100 30,424,700
International Business Machines 272,500 28,459,219
Microsoft Corp* 352,900 29,908,275
------------
96,563,075
------------
ELECTRICAL EQUIPMENT 3.58%
General Electric 384,000 29,856,000
------------
<PAGE>
ELECTRONICS --
SEMICONDUCTOR 6.01%
Altera Corp* 188,460 8,127,337
Intel Corp 326,800 29,309,875
Maxim Integrated Products* 315,100 12,722,163
------------
50,159,375
------------
ENTERTAINMENT 3.85%
Disney (Walt) Co 286,800 $ 32,103,675
------------
FINANCIAL 3.83%
Fannie Mae 500,000 31,906,250
------------
HEALTH CARE DRUGS --
PHARMACEUTICALS 18.09%
Bristol-Myers Squibb 301,600 30,216,550
Johnson & Johnson 432,400 32,646,200
Lilly (Eli) & Co 412,600 27,154,238
Merck & Co 240,900 30,729,806
Pfizer Inc 341,000 30,178,500
------------
150,925,294
------------
HOUSEHOLD PRODUCTS 4.62%
Colgate-Palmolive Co 101,600 8,248,650
Procter & Gamble 357,000 30,322,688
------------
38,571,338
------------
INSURANCE 7.29%
American International Group 260,000 31,248,750
Travelers Group 530,000 29,547,500
------------
60,796,250
------------
LEISURE TIME 0.80%
International Game Technology 274,600 6,659,050
------------
OIL & GAS RELATED 8.54%
Exxon Corp 467,900 29,887,112
Royal Dutch Petroleum New
York Registry 1.25 Gldr Shrs 527,400 28,644,413
Schlumberger Ltd 168,700 12,715,763
------------
71,247,288
------------
RETAIL 4.03%
Wal-Mart Stores 726,000 33,622,875
------------
SERVICES 0.99%
Cendant Corp* 219,200 8,220,000
------------
TELECOMMUNICATIONS --
LONG DISTANCE 4.38%
AT&T Corp 467,500 28,459,062
WorldCom Inc* 211,500 8,076,656
------------
36,535,718
------------
TELEPHONE 6.89%
Bell Atlantic 312,000 28,002,000
SBC Communications 390,000 29,493,750
------------
57,495,750
------------
TOBACCO 3.27%
Philip Morris 628,000 27,278,750
------------
TOTAL COMMON STOCKS
(Cost $707,376,584) 832,392,813
------------
<PAGE>
SHORT-TERM INVESTMENTS --
COMMERCIAL PAPER 0.21%
FINANCIAL 0.21%
Associates Corp of North America
5.673%, 3/2/1998
(Cost $1,760,000) $ 1,760,000 1,760,000
------------
TOTAL INVESTMENT
SECURITIES AT VALUE 100.00%
(Cost $709,136,584)
(Cost for Income Tax Purposes
$711,158,475) $834,152,813
============
</TABLE>
<TABLE>
<CAPTION>
CALL OPTIONS
- --------------------------------------------------------------------------------------------
Number of Expiration Exercise Premium Market
Contracts Date Price Received Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Call Option on
du Pont (EI)
de Nemours 1,000 4/18/1998 $55 $409,486 $675,000
+ Security has been designated as collateral for call options.
* Security is non-income producing.
See Notes to Financial Statements
</TABLE>
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Assets and Liabilities
February 28, 1998
UNAUDITED
ASSETS
Investment Securities at Value
(Cost $709,136,584) $ 834,152,813
Cash 3,229,576
Receivables:
Investment Securities Sold 19,084,330
Fund Shares Sold 764,662
Dividends and Interest 1,078,510
Prepaid Expenses 94,348
---------------
TOTAL ASSETS 858,404,239
---------------
LIABILITIES
Options Written, at Value
(Premiums Received $409,486) 675,000
Payables:
Distributions to Shareholders 7,449
Investment Securities Purchased 24,249,901
Fund Shares Repurchased 4,445,547
Accrued Distribution Expenses 149,251
Accrued Expenses 48,684
---------------
TOTAL LIABILITIES 29,575,832
---------------
Net Assets at Value $ 828,828,407
===============
NET ASSETS
Paid-in Capital* $ 685,060,949
Accumulated Undistributed Net Investment Income 1,732,570
Accumulated Undistributed Net Realized Gain
on Investment Securities and Foreign Currency
Transactions 17,284,173
Net Appreciation of Investment Securities and
Foreign Currency Transactions 124,750,715
---------------
Net Assets at Value $ 828,828,407
===============
Net Asset Value, Offering and Redemption
Price per Share $5.39
=====
* The Fund has 200 million authorized shares of common stock, par value of
$0.01 per share, of which 153,690,703 were outstanding at February 28, 1998.
See Notes to Financial Statements
<PAGE>
INVESCO Growth Fund, Inc.
Statement of Operations
Six Months Ended February 28, 1998
UNAUDITED
INVESTMENT INCOME
INCOME
Dividends $ 5,748,622
Interest 68,111
Foreign Taxes Withheld (65,795)
---------------
TOTAL INCOME 5,750,938
---------------
EXPENSES
Investment Advisory Fees 2,141,831
Distribution Expenses 940,756
Transfer Agent Fees 557,732
Administrative Fees 61,445
Custodian Fees and Expenses 43,188
Directors' Fees and Expenses 29,861
Professional Fees and Expenses 32,704
Registration Fees and Expenses 55,982
Reports to Shareholders 137,072
Other Expenses 11,679
---------------
TOTAL EXPENSES 4,012,250
Fees and Expenses Paid Indirectly (18,660)
---------------
NET EXPENSES 3,993,590
---------------
NET INVESTMENT INCOME 1,757,348
---------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT SECURITIES
Net Realized Gain on Investment Securities
and Foreign Currency Transactions 39,191,928
Change in Net Appreciation of:
Investment Securities and Foreign Currency
Transactions 87,094,670
Call Options (See Note 1) 265,514
---------------
Total Net Appreciation 87,360,184
---------------
NET GAIN ON INVESTMENT SECURITIES 126,552,112
---------------
Net Increase in Net Assets from Operations $ 128,309,460
===============
See Notes to Financial Statements
<PAGE>
<TABLE>
<CAPTION>
INVESCO Growth Fund, Inc.
Statement of Changes in Net Assets
Six Months Year
Ended Ended
February 28 August 31
------------- ------------
<S> <C> <C>
1998 1997
UNAUDITED
OPERATIONS
Net Investment Income $ 1,757,348 $ 1,584,172
Net Realized Gain on Investment
Securities and Foreign Currency
Transactions 39,191,928 185,903,395
Change in Net Appreciation
of Investment Securities, Foreign
Currency Transactions and
Call Options 87,360,184 (23,243,958)
--------------- ------------
NET INCREASE IN NET
ASSETS FROM OPERATIONS 128,309,460 164,243,609
--------------- ------------
DISTRIBUTIONS TO
SHAREHOLDERS
Net Investment Income 0 (1,500,483)
Net Realized Gain on Investment
Securities and Foreign Currency
Transactions (187,071,255) (84,751,427)
--------------- ------------
TOTAL DISTRIBUTIONS (187,071,255) (86,251,910)
--------------- ------------
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 282,403,499 647,469,283
Reinvestment of Distributions 165,451,154 77,405,695
-------------- ------------
447,854,653 724,874,978
Amounts Paid for Repurchases
of Shares (269,484,906) (690,372,256)
--------------- ------------
NET INCREASE IN NET
ASSETS FROM FUND SHARE
TRANSACTIONS 178,369,747 34,502,722
-------------- ------------
Total Increase in Net Assets 119,607,952 112,494,421
NET ASSETS
Beginning of Period 709,220,455 596,726,034
-------------- ------------
End of Period (Including Accumulated
Undistributed (Distributions in
Excess of) Net Investment
Income of $1,732,570 and
($24,778), respectively) $828,828,407 $709,220,455
=============== ============
- --------------------------------------------------------------------------------------------
FUND SHARE TRANSACTIONS
Shares Sold 48,900,138 113,639,331
<PAGE>
Shares Issued from Reinvestment
of Distributions 34,043,449 14,903,327
-------------- ------------
82,943,587 128,542,658
Shares Repurchased (46,365,062) (121,110,949)
-------------- ------------
Net Increase in Fund Shares 36,578,525 7,431,709
============== ============
See Notes to Financial Statements
</TABLE>
INVESCO Growth Fund, Inc.
Notes to Financial Statements
UNAUDITED
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.
Options are valued at the last sales price on the principal exchange on
which the options are traded. If there is no last sales price reported, then
the bid price will be used.
If market quotations or pricing service valuations are not readily
available, securities are valued at fair value as determined in good faith
by the 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
<PAGE>
translated into U.S. dollars at the rates of exchange prevailing when such
securities are acquired.
B. OPTIONS - The Fund may write covered call options. When an option the Fund
receives a premium and becomes obligated to sell the underlying security
at a fixed price, upon exercise of the option. In writing an option, the
Fund bears the market risk of an unfavorable change in the price of the
security underlying the written option. Exercise of an option written by
the Fund could result in the Fund selling a security at a price different
from the current market value. All securities covering call options
written are held in escrow by the Fund's custodian.
Written option activity for the six months ended February 28, 1998 was as
follows:
Call Options
-----------------------------
Number Amount
of Options of Premiums
---------------------------------------------------------------------------
Options outstanding at August 31, 1997..... 0 $ 0
Options written ............................ 1,000 409,486
Options closed or expired................... 0 0
Options exercised........................... 0 0
---------------------------
Options outstanding at February 28, 1998.... 1,000 $ 409,486
===========================
C. 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,
original issue discount and amortized premium, is recorded on the accrual
basis. Cost is determined on the specific identification basis.
The Fund may have elements of risk due to concentrated investments in
foreign issuers located in a specific country. Such concentrations may
subject the Fund to additional risks resulting from future political or
economic conditions and/or possible impositions of adverse foreign
governmental laws or currency exchange restrictions. Net realized and
unrealized gain or loss from investments includes fluctuations from currency
exchange rates and fluctuations in market value.
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. The Fund may hold foreign
currency in anticipation of settling foreign security transactions and not
for investment purposes.
D. 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.
<PAGE>
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.
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.
E. 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.
F. FORWARD FOREIGN CURRENCY CONTRACTS - The Fund enters into short-term forward
foreign currency contracts in connection with planned purchases or sales of
securities as a hedge against fluctuations in foreign exchange rates pending
the settlement of transactions in foreign securities. A forward foreign
currency contract is an agreement between contracting parties to exchange an
amount of currency at some future time at an agreed upon rate. These
contracts are marked-to-market daily and the related appreciation or
depreciation of the contracts is presented in the Statement of Assets and
Liabilities.
G. 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, Custodian
Fees and 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 six months ended February 28, 1998, Fees and Expenses Paid
Indirectly consisted of $18,467 included in Custodian Fees and Expenses and
$193 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 were made by ITC. Effective February 4, 1998, such responsibilities were
transferred to IFG. 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
compensation of marketing and advertising expenditures to IFG (the
"Distributor") to a maximum of 0.25% of annual average net assets. For the six
<PAGE>
months ended February 28, 1998, the Fund paid the Distributor $950,133 under the
plan of distribution. Effective September 29, 1997, INVESCO Distributors, Inc.,
a wholly owned subsidiary of IFG, replaced IFG as Distributor.
NOTE 3 - PURCHASES AND SALES OF INVESTMENT SECURITIES. For the six months
ended February 28, 1998, the aggregate cost of purchases and proceeds from sales
of investment securities (excluding all U.S. Government securities and
short-term securities) were $714,456,133 and $718,757,438, respectively.
There were no purchases or sales of U.S. Government securities.
NOTE 4 - APPRECIATION AND DEPRECIATION. At February 28, 1998, the gross
appreciation of securities in which there was an excess of value over tax cost
amounted to $123,980,247 and the gross depreciation of securities in which
there was an excess of tax cost over value amounted to $985,909, resulting in
net appreciation of $122,994,338.
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 are based on an annual rate equal to 40% of the retainer fee at the
time of retirement.
Pension expenses for the six months ended February 28, 1998, included in
Directors' Fees and Expenses in the Statement of Operations were $7,891.
Unfunded accrued pension costs of $28,806 and pension liability of $61,496
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 February 28, 1998, there
were no such borrowings.
Other Information
UNAUDITED
On October 28, 1997, a special meeting of the shareholders of the Fund was held
at which the approval to change the investment policy of the Fund to allow the
Fund to utilize futures contracts, options on futures, puts and calls to the
extent permitted by applicable law was ratified. The votes cast for, against and
abstain were 43,124,780, 14,151,226 and 4,004,904, respectively.
<PAGE>
<TABLE>
<CAPTION>
INVESCO Growth Fund, Inc.
Financial Highlights
(For a Fund Share Outstanding Throughout Each Period)
Six Months
Ended
February 28 Year Ended August 31
----------- ----------------------------------------------------
1998 1997 1996 1995 1994 1993
UNAUDITED
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA
Net Asset Value--- Beginning of Period $ 6.06 $5.44 $ 5.33 $5.34 $5.28 $4.72
------ ----------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.01 0.01 0.03 0.05 0.03 0.04
Net Gains on Securities
(Both Realized and
Unrealized) 0.92 1.39 0.95 0.49 0.11 1.00
----- ----------------------------------------------------
Total from Investment Operations 0.93 1.40 0.98 0.54 0.14 1.04
----- ----------------------------------------------------
LESS DISTRIBUTIONS
Dividends from Net Investment Income+ 0.00 0.01 0.03 0.05 0.03 0.04
Distributions from Capital Gains 1.60 0.77 0.84 0.50 0.05 0.44
----- ----------------------------------------------------
Total Distributions 1.60 0.78 0.87 0.55 0.08 0.48
------ ----------------------------------------------------
Net Asset Value--- End of Period $ 5.39 $ 6.06 $ 5.44 $ 5.33 $5.34 $5.28
====== ====================================================
TOTAL RETURN 18.25%* 28.14% 20.23% 12.05% 2.52% 22.17%
RATIOS
Net Assets --- End of Period ($000 Omitted) $828,828 $709,220 $596,726 $501,285 $488,411 $483,957
Ratio of Expenses to Average Net Assets 0.53%*@ 1.07%@ 1.05%@ 1.06% 1.03% 1.04%
Ratio of Net Investment Income to
Average Net Assets 0.23%* 0.22% 0.64% 1.07% 0.47% 0.72%
Portfolio Turnover Rate 95%* 286% 207% 111% 63% 77%
Average Commission Rate Paid^^ $0.0605* $0.0697 $0.0286 - - -
+ 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.
</TABLE>
<PAGE>
FAMILY OF FUNDS
Newspaper
Fund Name Fund Code Ticker Symbol Abbreviation
- --------------------------------------------------------------------------------
International
International Growth 49 FSIGX IntlGr
Emerging Markets 43 * *
Asian Growth 41 IVAGX AsianGr
Pacific Basin 54 FPBSX PcBas
European 56 FEURX Europ
European Small Company 37 IVECX EuroSmCo
Latin American Growth 34 IVSLX LatinAmGr
- --------------------------------------------------------------------------------
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
- --------------------------------------------------------------------------------
Equity
Growth 10 FLRFX Grwth
Dynamics 20 FIDYX Dynm
Small Company Growth 60 FIEGX SmCoGth
Value Equity 46 FSEQX ValEq
Small Company Value 74 IDSCX SmCoVal
S&P 500 Index Fund Class II 23 * *
- --------------------------------------------------------------------------------
All-Weather
Industrial Income 15 FIIIX IndInc
Multi-Asset Allocation 70 IMAAX MulAstAl
Total Return 48 FSFLX TotRtn
Balanced 71 IMABX Bal
- --------------------------------------------------------------------------------
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
* 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
Post Office Box 173706
Denver, CO 80217-3706
1-800-525-8085
PAL(R): 1-800-424-8085
http://www.invesco.com
In Denver, visit one of our
convenient Investor Centers:
Cherry Creek,
155-B Fillmore Street
Denver Tech Center,
7800 East Union Avenue,
Lobby Level
This information must be
preceded or accompanied
by a current prospectus.
