<PAGE> 1
[AIM LOGO APPEARS HERE]
[GRAPHIC COLLAGE APPEARS HERE]
AIM GLOBAL UTILITIES FUND
ANNUAL REPORT
DECEMBER 31, 1995
<PAGE> 2
AIM GLOBAL UTILITIES FUND
For shareholders who seek high current income and capital appreciation through
a portfolio primarily of common and preferred stocks of public utility
companies.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Global Utilities Fund performance figures are historical and
reflect reinvestment of all distributions and changes in net asset value.
Unless otherwise indicated, Fund results were computed at net asset value
without reflecting sales charges.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B share
performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC declines from 5% to reach 0% at
the beginning of the seventh year. The performance of the Fund's Class B
shares will differ from that of Class A shares.
o In 1995, the Fund paid distributions of $0.522 and $0.4065 for Class A and
Class B shares, respectively.
o The Fund's investment return and principal value will fluctuate so
that an investor's shares, when redeemed, may be worth more or less
than their original cost.
o Past performance cannot guarantee comparable future results.
o The Fund's portfolio composition is subject to change, and there is no
assurance the Fund will continue to hold any one particular security
or stay invested in any one particular country.
o On May 1, 1995, AIM Utilities Fund broadened its investment strategy to
permit up to 80% of its total assets to be invested in foreign
securities, and was renamed AIM Global Utilities Fund.
o International investing presents certain risks not associated with
investing solely in the United States. These include, for instance, risks
relating to fluctuations in the value of the U.S. dollar relative to the
values of other currencies, the custody arrangements made for the Fund's
foreign holdings, political risks, differences in accounting, and the
lesser degree of public information required to be provided by non-U.S.
companies.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The Dow Jones Industrial Average is a price-weighted average of 30
actively traded primarily industrial stocks.
o The Standard & Poor's 500 (S&P 500) is a group of unmanaged securities
widely regarded by investors to be representative of the stock market
in general.
o The Lehman Brothers Aggregate Bond Index is an unmanaged index generally
regarded as representative of intermediate and long-term government and
investment-grade corporate debt securities.
o The Standard & Poor's 40 Utilities Index (S&P 40) is an unmanaged index
comprising common stocks of 40 utility companies.
o The Dow Jones Average of 15 Utilities is a weighted average of the
performance of 15 large publicly traded utility stocks.
o The Lipper Utility Funds Index is an average of the 30 largest utility
funds tracked by Lipper Analytical Services, Inc., an independent mutual
fund performance monitor.
o An investment cannot be made in any indexes listed. Unless otherwise
indicated, index results include reinvested dividends and do not reflect
sales charges.
This report may be distributed only to current shareholders or to persons who
have received a current prospectus of the Fund.
<PAGE> 3
A Message from
the Chairman
Dear Fellow Shareholder:
In an environment of declining interest rates and
continued strength of many domestic electric and telephone
companies, AIM Global Utilities Fund delivered excellent
[PHOTO OF results for the fiscal year ended December 31, 1995. We are
Charles T. Bauer, pleased to report that total return during the 12 months
Chairman of ended December 31, 1995, was 28.07% and 27.16% for
the Board of Class A and Class B shares, respectively.
the Fund, Your Fund outperformed the 26.86% total return of the
APPEARS HERE] Lipper Utility Funds Index. Such performance contributed
to substantial growth in the Fund's assets under management,
which grew from $193.1 million at the opening of the
fiscal year to $241.3 million by its close.
Indeed, 1995 was a memorable year for your Fund and for AIM overall. AIM's
net assets under management grew from $27 billion to approximately $42 billion.
We now serve more than 2 million shareholders like you who continue to count
on our expertise and diligence in investment management.
However, like many market watchers, we are mindful that excellent
performance by both equities and bonds in a given year, as occurred in 1995, is
relatively unusual. Market cycles come and go, and the type of performance
experienced by stocks and bonds last year is unlikely to continue
uninterrupted. AIM, along with many analysts, cautions investors to keep in
mind that those who have retained a long-term perspective have generally
enjoyed the greatest returns on their investments.
Our more detailed discussion of the year's markets, your Fund's strategies,
and our outlook for the future appears in the Management's Discussion &
Analysis that begins on the following page.
On a personal level, 1996 has important investment implications for all of
us. The Washington budget debate over such retirement benefits as Medicare and
Social Security brings home the need to build your own retirement nest egg
independent of any benefits that may-or may not-be available to you when the
time comes. For many baby boomers, that is just 10 years away.
We appreciate your confidence in AIM Global Utilities Fund to provide
income and to help build your financial future. If you have any questions or
comments, please call Client Services at 800-959-4246 during normal business
hours. For automated account information 24 hours a day, dial the AIM Investor
Line toll-free at 800-246-5463.
Respectfully submitted,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
AIM GLOBAL UTILITIES FUND
OUTPERFORMED THE AVERAGE
UTILITIES FUND IN 1995
AIM GLOBAL UTILITIES FUND
CLASS A SHARES
28.07%
AIM GLOBAL UTILITIES FUND
CLASS B SHARES
27.16%
LIPPER UTILITY FUNDS
INDEX
26.86%
Fund total return performance is
compared to the performance of
the 30 largest utilities funds
tracked by Lipper, excluding all
sales charges, and including fees
and expenses.
<PAGE> 4
Management's
Discussion & Analysis
------------------------
Electric utilities
and telephone
companies were
particularly good
performers, and
your Fund holds
substantial posi-
tions in both of
these industries.
------------------------
FUND PERFORMANCE STRONG IN MODERATING ECONOMY
1995 was a dramatic year in financial markets. Continued strong earnings
reports by U.S. corporations, moderating economic growth, restrained inflation,
and declining interest rates all combined to fuel a bull market for both
equities and bonds.
Equities markets produced striking results. The Dow Jones Industrial
Average was up 36.83% for the year; the broader Standard & Poor's Composite
Index of 500 Stocks rose 37.45%. While markets took a breather late in the year
after some big names reported earnings disappointments, earnings fundamentals
remained strong for U.S. firms. Of the companies reporting earnings in the
third quarter of 1995, I/B/E/S International Inc. reported in The Wall Street
Journal that 55% were higher than analysts' expectations, 14% on target, and
31% below expectations. As of this writing, only a limited number of
fourth-quarter earnings reports were available, not enough to make an informed
judgment about the trend. Predictions concerning fourth-quarter earnings were
mixed.
While stock markets repeatedly pushed such benchmarks as the Dow to
new highs, bonds also thrived in an environment of declining interest rates and
negligible inflation. The yield on a 30-year Treasury bond, for example,
dropped almost 2% during the year, from 7.88% to 5.95%, which buoyed the value
of existing bonds. One benchmark of bond performance, the Lehman Brothers
Aggregate Bond Index, produced a total return of 18.47% for the year, the kind
of double-digit performance generally thought more typical of equities markets.
The utilities sector performed well in this environment, as evidenced
by the solid rise of more than 30% in the Dow Jones Average of 15 Utilities.
Electric utilities and telephone companies were particularly good performers,
and your Fund holds substantial positions in both of these industries.
YOUR INVESTMENT PORTFOLIO
Declining interest rates during 1995 were advantageous to domestic electric
utility firms, which tend to be large borrowers because of the capital demands
of the industry. Electric services firms constituted approximately 38% of the
Fund's portfolio at fiscal year-end. In addition, many electric utilities have
undertaken major restructurings designed to boost earnings as both competition
and regulatory resistance to raising electric rates grow. The Fund continued to
maintain large positions in certain regional U.S. electric companies.
The Southern Co., for example, which operates several subsidiary
electric companies in Georgia and on the Gulf Coast, enjoyed increased revenues
and earnings during 1995. It also took part in the nascent globalization of the
utilities industry when it acquired the British utility South Western in
October. In the fall of 1995, the Houston Chronicle referred to The Southern
Co., Duke Power Co., and Illinova Corp., all holdings of the Fund, as
"efficient, agile companies" well suited to survive an expected shakeout among
electric services providers.
The telephone industry represents another major portion of the Fund's
portfolio, approximately 16%. This is a rapidly evolving, growing industry. The
so-called Baby Bells have been thriving since the breakup of AT&T during the
1980s, and recent technological advances that improved their ability to carry
more data on existing phone lines and to carry voice and data simultaneously
are enhancing their competitiveness. Ameritech Corp. and BellSouth Corp. are
two examples of Baby Bells that have moved aggressively into cellular
communications and the so-called "information highway." BellSouth is expanding
globally, with a half-million customers overseas, mostly for wireless
communications services. Both Ameritech and BellSouth Corp. are major holdings
of your Fund.
Foreign securities constituted approximately 25% of the Fund's
holdings at the close of the fiscal year. After building foreign positions
through the third quarter of 1995, Fund management reduced foreign holdings in
response to earnings disappointments, especially in European utilities.
However, as The Southern Co. and BellSouth Corp. illustrate, the days when a
U.S. utility company could be regarded as purely domestic may
See important Fund disclosure on inside front cover.
2
<PAGE> 5
Management's
Discussion & Analysis
be numbered.
Almost 80% of the portfolio consisted of common stock. Almost 20% of
the portfolio was in bonds, including convertible bonds, which helped the Fund
pay steady monthly dividends throughout 1995. The rest of the holdings were
convertible stocks or cash equivalents. The total number of holdings was
approximately 130 as of December 31. Of course, the Fund's portfolio is subject
to change and there is no guarantee it will continue to hold these same
securities.
OUTLOOK FOR THE FUTURE
As the fiscal year closed, it was the consensus of economists and other market
watchers that interest rates should remain stable or decline and that inflation
should remain under control during 1996. While the partial government shutdown
during December prevented release of economic data from some federal agencies,
private data and anecdotal evidence indicated a fairly sharp slowdown in
economic growth during 1995's fourth quarter. Lagging Christmas sales, rapid
growth in consumer indebtedness, a continuing wave of restructurings and
layoffs among U.S. corporations, and flat wages were among the phenomena
fostering concern that economic growth could be more sluggish than desired.
Many expected the Federal Reserve to reduce short-term interest rates
further, and one month after the close of the fiscal year, the Fed did just
that, lowering the benchmark federal funds rate .25%. This bodes well for an
interest rate-sensitive investment such as AIM Global Utilities Fund.
While some analysts fret about the impact of competition in the
formerly regulated utilities industry, many see potential opportunity as the
sector becomes more dynamic and winners and losers begin to emerge. The
potential of overseas markets remains vast. Industry observers foresee great
possibilities in foreign utilities investments amid booming demand for
electricity and for telecommunications equipment in Asia and Latin America in
particular. For example, Morgan Stanley has estimated 1993 1998 annual earnings
per share growth for electric service companies worldwide. For the Pacific
Rim/Hong Kong, it foresaw growth of 20%, for Latin America, 13%. In the U.S.,
by contrast, Morgan Stanley estimated annual growth of 2%.
Rather than making projections and educated guesses about the shape of
future markets, AIM remains committed to its disciplined investment strategy,
which examines the merits of each security it may buy or sell without the
guesswork of market timing. In selecting stocks to include in the portfolio,
Fund management stresses earnings history while never losing sight of market
valuation. In selecting bonds, management carefully scrutinizes the credit and
structure of each issue and its potential impact on the portfolio.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
- ------------------------------------------------------------------------------------------------------
AIM Global Utilities Fund AIM Global Utilities Fund
Class A Shares (w/o sales charge) Class A Shares (w/sales charge) S&P 500
<S> <C> <C> <C>
1/19/88 $ 10,000 $ 9,453 $ 10,000
12/88 11,668 11,030 11,545
12/89 15,881 15,013 15,192
12/90 15,408 14,566 14,719
12/91 19,052 18,011 19,184
12/92 20,562 19,438 20,643
12/93 23,095 21,833 22,715
12/94 20,424 19,308 23,023
12/95 26,158 24,728 31,644
- ------------------------------------------------------------------------------------------------------
</TABLE>
Past performance cannot guarantee comparable future results.
An investment cannot be made in any indexes listed. Unless otherwise indicated,
index results include reinvested dividends and do not reflect sales charges.
Source: Towers Data Systems HYPO(R).
It is important to note that the S&P 500 is a broad equities market
index that does not include many utility stocks. As of December 31, 1995, only
12.33% of the S&P 500 consisted of utility stocks.
The performance of Class B shares will differ from that of Class A
shares due to differing fees and expenses.
For Fund performance calculations and descriptions of any indexes
cited on this page, please refer to the inside front cover of this report.
- --------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(As of 12/31/95)
- --------------------------------------------------------------------------------
TOP 5 INDUSTRIES
1. ELECTRIC POWER
2. TELEPHONE
3. TELECOMMUNICATIONS
4. NATURAL GAS PIPELINE
5. GAS DISTRIBUTION
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOP 5 DOMESTIC HOLDINGS (EXCLUDING U.S. TREASURY ISSUES)
1. AMERITECH CORP.
2. ENRON CORP.
3. FPL GROUP, INC.
4. NORTHERN STATES POWER CO.
5. BELLSOUTH CORP.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TOP 5 FOREIGN HOLDINGS
1. TELECOM CORP. OF NEW ZEALAND - ADR
2. TELEFONAKTIEBOLAGET L.M. ERICSSON
3. BELL CANADA
4. VEBA A.G.
5. ROYAL PTT NEDERLAND N.V. - ADR
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WITHOUT WITH
SALES CHARGE SALES CHARGE
<S> <C> <C>
CLASS A SHARES
Inception (1/18/88) 12.86% 12.06%
5 Years 11.16 9.92
1 Year 28.07 21.02
CLASS B SHARES
Inception (9/1/93) 2.33% 1.13%
1 Year 27.16 22.16
- --------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 6
Financials
SCHEDULE OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
SHARES MARKET VALUE
<S> <C> <C>
DOMESTIC COMMON STOCKS-56.32%
COMPUTER NETWORKING-0.58%
12,400 Ascend Communications, Inc.(a) $ 1,005,950
- ---------------------------------------------------------------------------------------------
14,571 Network Equipment Technologies, Inc.(a) 398,893
- ---------------------------------------------------------------------------------------------
1,404,843
- ---------------------------------------------------------------------------------------------
COMPUTER SOFTWARE/SERVICES-0.53%
23,200 Objective Systems Integrators, Inc.(a) 1,270,200
- ---------------------------------------------------------------------------------------------
1,300 Smith Micro Software, Inc.(a) 8,776
- ---------------------------------------------------------------------------------------------
1,278,976
- ---------------------------------------------------------------------------------------------
CONGLOMERATES-0.41%
20,000 Tenneco Inc. 992,500
- ---------------------------------------------------------------------------------------------
ELECTRIC SERVICES-28.81%
45,000 Allegheny Power System, Inc. 1,288,127
- ---------------------------------------------------------------------------------------------
56,600 Boston Edison Co. 1,669,700
- ---------------------------------------------------------------------------------------------
35,000 Carolina Power & Light Co. 1,207,500
- ---------------------------------------------------------------------------------------------
16,200 CMS Energy Corp. 483,976
- ---------------------------------------------------------------------------------------------
35,400 Consolidated Edison Co. of New York, Inc. 1,132,802
- ---------------------------------------------------------------------------------------------
54,000 Detroit Edison Co. 1,863,000
- ---------------------------------------------------------------------------------------------
188,700 DPL Inc. 4,670,325
- ---------------------------------------------------------------------------------------------
129,500 DQE, Inc. 3,982,125
- ---------------------------------------------------------------------------------------------
106,400 Duke Power Co. 5,040,700
- ---------------------------------------------------------------------------------------------
147,600 FPL Group, Inc. 6,844,950
- ---------------------------------------------------------------------------------------------
136,500 General Public Utilities Corp. 4,641,000
- ---------------------------------------------------------------------------------------------
253,000 Houston Industries, Inc. 6,135,250
- ---------------------------------------------------------------------------------------------
163,500 Illinova Corp. 4,905,000
- ---------------------------------------------------------------------------------------------
10,800 LG & E Energy Corp. 456,300
- ---------------------------------------------------------------------------------------------
95,500 NIPSCO Industries, Inc. 3,652,875
- ---------------------------------------------------------------------------------------------
134,600 Northern States Power Co. 6,612,225
- ---------------------------------------------------------------------------------------------
143,000 Pinnacle West Capital Corp. 4,111,250
- ---------------------------------------------------------------------------------------------
199,700 Southern Co. (The) 4,917,613
- ---------------------------------------------------------------------------------------------
95,000 Teco Energy, Inc. 2,434,375
- ---------------------------------------------------------------------------------------------
75,000 Unicom Corp. 2,456,250
- ---------------------------------------------------------------------------------------------
33,300 Wisconsin Energy Corp. 1,019,813
- ---------------------------------------------------------------------------------------------
69,525,156
- ---------------------------------------------------------------------------------------------
GAS DISTRIBUTION-1.39%
95,200 Public Service Co. of Colorado 3,367,700
- ---------------------------------------------------------------------------------------------
NATURAL GAS PIPELINE-6.07%
36,000 Columbia Gas System, Inc.(a) 1,579,500
- ---------------------------------------------------------------------------------------------
100,000 Enron Corp. 3,812,500
- ---------------------------------------------------------------------------------------------
31,600 KN Energy, Inc. 920,350
- ---------------------------------------------------------------------------------------------
17,600 Pacific Enterprises 497,200
- ---------------------------------------------------------------------------------------------
93,300 Panhandle Eastern Corp. 2,600,738
- ---------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE> 7
Financials
<TABLE>
<CAPTION>
SHARES MARKET VALUE
<S> <C> <C>
NATURAL GAS PIPELINE (continued)
35,000 Sonat Inc. $ 1,246,877
- ---------------------------------------------------------------------------------------------
91,000 Williams Companies Inc. (The) 3,992,625
- ---------------------------------------------------------------------------------------------
14,649,790
- ---------------------------------------------------------------------------------------------
REAL ESTATE INVESTMENT TRUSTS-2.01%
44,300 Bay Apartment Communities 1,074,275
- ---------------------------------------------------------------------------------------------
21,300 Meditrust 742,839
- ---------------------------------------------------------------------------------------------
15,000 National Health Investors, Inc. 496,876
- ---------------------------------------------------------------------------------------------
5,500 Nationwide Health Properties, Inc. 231,000
- ---------------------------------------------------------------------------------------------
26,700 Oasis Residential Inc. 607,426
- ---------------------------------------------------------------------------------------------
32,000 Patriot American Hospitality, Inc. 824,000
- ---------------------------------------------------------------------------------------------
32,000 Public Storage, Inc. 608,000
- ---------------------------------------------------------------------------------------------
16,500 RFS Hotel Investors Inc. 253,688
- ---------------------------------------------------------------------------------------------
4,838,104
- ---------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-2.49%
52,000 A T & T Corp. 3,367,000
- ---------------------------------------------------------------------------------------------
84,700 Frontier Corp. 2,541,000
- ---------------------------------------------------------------------------------------------
6,800 Tel-Save Holdings, Inc.(a) 94,350
- ---------------------------------------------------------------------------------------------
6,002,350
- ---------------------------------------------------------------------------------------------
TELEPHONE-14.03%
136,700 Ameritech Corp. 8,065,300
- ---------------------------------------------------------------------------------------------
18,700 Bell Atlantic Corp. 1,250,563
- ---------------------------------------------------------------------------------------------
145,800 BellSouth Corp. 6,342,300
- ---------------------------------------------------------------------------------------------
75,700 Century Telephone Enterprises, Inc. 2,403,474
- ---------------------------------------------------------------------------------------------
117,000 Cincinnati Bell, Inc. 4,065,750
- ---------------------------------------------------------------------------------------------
25,000 GTE Corp. 1,100,000
- ---------------------------------------------------------------------------------------------
47,000 NYNEX Corp. 2,538,000
- ---------------------------------------------------------------------------------------------
91,400 SBC Communications, Inc. 5,255,500
- ---------------------------------------------------------------------------------------------
30,000 Southern New England Telecommunications Corp. 1,192,500
- ---------------------------------------------------------------------------------------------
46,000 US West, Inc. 1,644,500
- ---------------------------------------------------------------------------------------------
33,857,887
- ---------------------------------------------------------------------------------------------
Total Domestic Common Stocks 135,917,306
- ---------------------------------------------------------------------------------------------
DOMESTIC CONVERTIBLE PREFERRED STOCKS-0.87%
OIL & GAS-SERVICES-0.40%
40,000 Enron Corp.-$1.36 Conv. Pfd. 960,000
- ---------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-0.47%
23,500 MFS Communications Co., Inc.-$2.68 Conv. Pfd. 1,144,156
- ---------------------------------------------------------------------------------------------
Total Domestic Convertible Preferred Stocks 2,104,156
- ---------------------------------------------------------------------------------------------
FOREIGN STOCKS & OTHER EQUITY INTERESTS-21.71%
ARGENTINA-1.13%
368,200 Central Costanera S.A.-Class B (Electric Services) 1,133,829
- ---------------------------------------------------------------------------------------------
98,800 Central Puerto S.A.-Class B (Electric Services) 375,364
- ---------------------------------------------------------------------------------------------
44,600 Telefonica de Argentina-ADR (Telephone) 1,215,350
- ---------------------------------------------------------------------------------------------
2,724,543
- ---------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE> 8
Financials
<TABLE>
<CAPTION>
SHARES MARKET VALUE
<S> <C> <C>
AUSTRIA-0.31%
12,500 Oesterreichisch Elektrizitatswirtschafts-AG (Verbundgesellschaft)
Class A (Electric Services) $ 751,599
- ---------------------------------------------------------------------------------------------
BRAZIL-0.49%
25,000 Telecomunicacoes Brasileiras S/A-Telebras-ADR
(Telecommunications) 1,184,375
- ---------------------------------------------------------------------------------------------
CANADA-0.53%
87,800 Westcoast Energy, Inc. (Natural Gas Pipeline) 1,284,075
- ---------------------------------------------------------------------------------------------
CHILE-1.17%
17,600 Compania de Telecomunicaciones de Chile S.A.-ADR
(Telecommunications) 1,458,600
- ---------------------------------------------------------------------------------------------
47,800 Enersis S.A.-ADR (Electric Services) 1,362,300
- ---------------------------------------------------------------------------------------------
2,820,900
- ---------------------------------------------------------------------------------------------
DENMARK-0.38%
33,600 Tele Danmark A/S-ADR(a) (Telephone) 928,200
- ---------------------------------------------------------------------------------------------
GERMANY-0.82%
46,500 Veba A.G. (Electrical Services) 1,974,102
- ---------------------------------------------------------------------------------------------
HONG KONG-0.19%
25,500 Hong Kong Telecom Ltd.-ADR (Telephone) 452,625
- ---------------------------------------------------------------------------------------------
INDONESIA-0.42%
27,700 PT Indostat-ADR(a) (Telephone) 1,011,050
- ---------------------------------------------------------------------------------------------
ISRAEL-0.22%
23,200 ECI Telecom Ltd. (Telecommunications) 529,250
- ---------------------------------------------------------------------------------------------
ITALY-0.80%
578,300 Telecom Italia Mobile S.p.A.(Telephone) 1,015,950
- ---------------------------------------------------------------------------------------------
593,300 Telecom Italia S.p.A. (Telephone) 920,140
- ---------------------------------------------------------------------------------------------
1,936,090
- ---------------------------------------------------------------------------------------------
KOREA-0.55%
49,500 Korea Electric Power Corp.-ADR (Electric Services) 1,324,125
- ---------------------------------------------------------------------------------------------
NETHERLANDS-1.23%
20,000 Elsag Bailey Process Automation N.V.-ADR-$2.75 Conv. Pfd.
TOPRS(b) (Acquired 12/14/95-12/15/95; cost $1,000,250) (Electronic
Components-Miscellaneous) 1,002,500
- ---------------------------------------------------------------------------------------------
54,170 Royal PTT Nederland N.V.-ADR(b) (Acquired 06/13/94-10/23/95;
cost $1,575,432) (Telecommunications) 1,963,662
- ---------------------------------------------------------------------------------------------
2,966,162
- ---------------------------------------------------------------------------------------------
NEW ZEALAND-1.45%
50,600 Telecom Corp. of New Zealand Ltd.-ADR (Telephone) 3,510,375
- ---------------------------------------------------------------------------------------------
NORWAY-0.61%
45,000 Nera AS-ADR(a) (Telecommunications) 1,462,500
- ---------------------------------------------------------------------------------------------
PERU-0.76%
850,300 CPT Telefonica Del Peru-Class B (Telephone) 1,821,282
- ---------------------------------------------------------------------------------------------
PORTUGAL-0.52%
65,700 Portugal Telecom, S.A.-ADR(a) (Telecommunications) 1,248,300
- ---------------------------------------------------------------------------------------------
SPAIN-2.91%
86,500 Amper S.A.(Electrical Equipment)(a) 1,023,309
- ---------------------------------------------------------------------------------------------
24,000 Empresa Nacional de Electricidad S.A. (Electric Services) 1,374,000
- ---------------------------------------------------------------------------------------------
29,800 Empresa Nacional de Electricidad S.A.-ADR (Electric Services) 677,950
- ---------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE> 9
Financials
<TABLE>
<CAPTION>
SHARES MARKET VALUE
<S> <C> <C>
SPAIN (continued)
11,000 Gas Natural SDG-E S.A. (Natural Gas Pipeline) $ 1,713,932
- ---------------------------------------------------------------------------------------------
141,000 Iberdrola S.A. (Electric Services) 1,290,272
- ---------------------------------------------------------------------------------------------
22,200 Telefonica de Espana, S.A. (Telecommunications) 929,625
- ---------------------------------------------------------------------------------------------
7,009,088
- ---------------------------------------------------------------------------------------------
SWEDEN-1.16%
10,808 Telefonaktiebolaget L.M. Ericsson (Telecommunications) 211,611
- ---------------------------------------------------------------------------------------------
133,232 Telefonaktiebolaget L.M. Ericsson-ADR (Telecommunications) 2,598,024
- ---------------------------------------------------------------------------------------------
2,809,635
- ---------------------------------------------------------------------------------------------
UNITED KINGDOM-6.06%
265,600 British Gas PLC (Natural Gas Pipeline) 1,047,715
- ---------------------------------------------------------------------------------------------
10,000 British Sky Broadcasting Group PLC-ADR
(Advertising/Broadcasting) 376,250
- ---------------------------------------------------------------------------------------------
47,900 London Electricity PLC (Electric Services) 426,629
- ---------------------------------------------------------------------------------------------
74,700 Midlands Electricity PLC (Electric Services) 881,689
- ---------------------------------------------------------------------------------------------
205,075 National Grid Group PLC(a) (Electric Services) 635,388
- ---------------------------------------------------------------------------------------------
175,000 National Power PLC (Electric Services) 1,221,657
- ---------------------------------------------------------------------------------------------
40,000 National Power PLC-ADR (Electric Services) 370,000
- ---------------------------------------------------------------------------------------------
197,100 North West Water PLC (Water Supply) 1,885,597
- ---------------------------------------------------------------------------------------------
45,500 NYNEX CableComms Group(a) (Telecommunications) 790,562
- ---------------------------------------------------------------------------------------------
119,000 PowerGen PLC (Electric Services) 984,120
- ---------------------------------------------------------------------------------------------
40,900 PowerGen PLC-ADR (Electric Services) 536,812
- ---------------------------------------------------------------------------------------------
138,550 Scottish Power PLC (Electric Services) 796,140
- ---------------------------------------------------------------------------------------------
47,925 Seeboard PLC (Electric Services) 391,497
- ---------------------------------------------------------------------------------------------
49,775 South Wales Electricity PLC (Electric Services) 721,231
- ---------------------------------------------------------------------------------------------
40,000 Southern Electric PLC (Electric Services) 561,577
- ---------------------------------------------------------------------------------------------
20,000 Vodafone Group PLC-ADR (Telecommunications) 705,000
- ---------------------------------------------------------------------------------------------
73,750 Wessex Water PLC (Water Supply) 399,732
- ---------------------------------------------------------------------------------------------
88,500 Wessex Water Preference (Water Supply) 70,096
- ---------------------------------------------------------------------------------------------
46,730 Yorkshire Electricity PLC (Electric Services) 484,790
- ---------------------------------------------------------------------------------------------
145,800 Yorkshire Water PLC (Water Supply) 1,340,481
- ---------------------------------------------------------------------------------------------
14,626,963
- ---------------------------------------------------------------------------------------------
Total Foreign Stocks & Other Equity Interests 52,375,239
- ---------------------------------------------------------------------------------------------
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
DOMESTIC CONVERTIBLE BONDS-2.64%
COMPUTER SOFTWARE/SERVICES-0.19%
$ 441,000 Network Equipment Technologies, Conv. Sub. Deb.,
7.25%, 05/15/14 451,672
- ---------------------------------------------------------------------------------------------
ELECTRIC SERVICES-0.46%
1,100,000 California Energy Co., Inc., Conv. Sub. Deb.,
5.00%, 07/31/00(b) (Acquired 04/26/95; cost $988,625) 1,108,580
- ---------------------------------------------------------------------------------------------
ELECTRONIC COMPONENTS/MISCELLANEOUS-0.41%
850,000 Altera Corp., Conv. Sub. Notes,
5.75%, 06/15/02(b) (Acquired 06/16/95-12/13/95; cost $870,400) 990,250
- ---------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE> 10
Financials
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
<S> <C> <C>
SEMICONDUCTORS-0.75%
$ 750,000 Analog Devices, Conv. Sub. Notes, 3.50%, 12/01/00 $ 798,750
- ---------------------------------------------------------------------------------------------
1,125,000 Xilinx Inc., Conv. Sub. Notes,
5.25%, 11/01/02(b) (Acquired 11/07/95-11/08/95; cost
$1,125,000) 1,023,750
- ---------------------------------------------------------------------------------------------
1,822,500
- ---------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-0.83%
2,620,000 United States Cellular Corp., Conv. Liquid Yield Option Notes,
6.00%, 06/15/15(c) 933,375
- ---------------------------------------------------------------------------------------------
1,000,000 World Communications, Conv. Sub. Notes, 5.00%, 08/15/03 1,065,000
- ---------------------------------------------------------------------------------------------
1,998,375
- ---------------------------------------------------------------------------------------------
Total Domestic Convertible Bonds 6,371,377
- ---------------------------------------------------------------------------------------------
DOMESTIC NON-CONVERTIBLE BONDS-6.93%
ADVERTISING/BROADCASTING-0.51%
1,150,000 Time Warner Inc., Notes, 8.18%, 08/15/07 1,235,249
- ---------------------------------------------------------------------------------------------
ELECTRIC SERVICES-1.64%
127,000 Ohio Power Co., First Mortgage Bonds, 9.875%, 08/01/20 136,517
- ---------------------------------------------------------------------------------------------
1,750,000 Pennsylvania Power & Light Co., First Mortgage Bonds,
9.25%, 10/01/19 1,918,700
- ---------------------------------------------------------------------------------------------
1,640,000 San Diego Gas & Electric Co., First Mortgage Series JJ Bonds,
9.625%, 04/15/20 1,913,732
- ---------------------------------------------------------------------------------------------
3,968,949
- ---------------------------------------------------------------------------------------------
NATURAL GAS PIPELINE-2.60%
3,750,000 Enron Corp., Sr. Sub. Deb., 6.75%, 07/01/05 3,832,387
- ---------------------------------------------------------------------------------------------
2,205,000 Panhandle Eastern Pipeline, Deb., 7.875%, 08/15/04 2,431,960
- ---------------------------------------------------------------------------------------------
6,264,347
- ---------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-2.18%
1,850,000 A T & T Corp., Sr. Notes, 7.75%, 03/01/07 2,079,142
- ---------------------------------------------------------------------------------------------
3,000,000 TCI Communications Inc., Sr. Notes, 8.00%, 08/01/05 3,184,470
- ---------------------------------------------------------------------------------------------
5,263,612
- ---------------------------------------------------------------------------------------------
Total Domestic Non-Convertible Bonds 16,732,157
- ---------------------------------------------------------------------------------------------
FOREIGN NON-CONVERTIBLE BONDS-2.11%
CANADA-1.75%
CAD 1,800,000 Bell Canada, Deb., (Telecommunications)
8.80%, 08/17/05 753,530
- ---------------------------------------------------------------------------------------------
CAD 950,000 Bell Canada, Deb., (Telecommunications)
10.875%, 10/11/04 1,575,118
- ---------------------------------------------------------------------------------------------
CAD 2,350,000 IPL Energy, Deb. (Oil & Gas-Services)
9.67%, 02/23/00 1,882,323
- ---------------------------------------------------------------------------------------------
4,210,971
- ---------------------------------------------------------------------------------------------
MEXICO-0.36%
850,000 United Mexican States, Deb., (Foreign Government Securities)
11.1875%, 07/21/97(b) (Acquired 07/12/95; cost $850,000) 870,723
- ---------------------------------------------------------------------------------------------
Total Foreign Non-Convertible Bonds 5,081,694
- ---------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE> 11
Financials
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MARKET VALUE
<S> <C> <C>
U.S. TREASURY SECURITIES-6.50%
U.S. TREASURY BONDS-2.84%
$ 3,000,000 7.125%, 02/29/00 $ 3,195,000
- ---------------------------------------------------------------------------------------------
3,000,000 7.625%, 02/15/25 3,666,900
- ---------------------------------------------------------------------------------------------
6,861,900
- ---------------------------------------------------------------------------------------------
U.S. TREASURY NOTES-3.66%
2,500,000 7.25%, 08/15/04 2,782,500
- ---------------------------------------------------------------------------------------------
2,500,000 7.50%, 02/15/05 2,837,175
- ---------------------------------------------------------------------------------------------
3,000,000 6.50%, 08/15/05 3,199,440
- ---------------------------------------------------------------------------------------------
8,819,115
- ---------------------------------------------------------------------------------------------
Total U.S. Treasury Securities 15,681,015
- ---------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT-2.32%(d)
5,595,599 Daiwa Securities America Inc.,
5.92%, 01/02/96(e) 5,595,599
- ---------------------------------------------------------------------------------------------
TOTAL INVESTMENTS-99.40% 239,858,543
- ---------------------------------------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-0.60% 1,459,142
- ---------------------------------------------------------------------------------------------
NET ASSETS-100.00% $241,317,685
=============================================================================================
</TABLE>
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Restricted securities. May be resold to qualified institutional buyers in
accordance with provisions of Rule 144A under the Securities Act of 1933, as
amended. The valuation of these securities has been determined in accordance
with procedures established by the Board of Trustees. The aggregate market
value of these securities at December 31, 1995, was $6,959,465, which
represents 2.88% of net assets.
(c) Zero coupon bond. The interest rate shown represents the rate of the
original issue discount.
(d) Collateral on repurchase agreement, including the Fund's pro-rata interest
in joint repurchase agreements, is taken into possession by the Fund upon
entering into the repurchase agreement. The collateral is marked to market
daily to ensure its market value as being 102 percent of the sales price of
the repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds managed by
the investment advisor.
(e) Joint repurchase agreement entered into 12/29/95 with a maturing value of
$646,679,181. Collateralized by $537,995,000 U.S. Treasury obligations,
7.875% to 11.25% due 11/15/07 to 02/15/15.
Abbreviations:
ADR -American Depositary Receipt
CAD -Canadian Dollars
Conv. -Convertible
Deb. -Debentures
Pfd. -Preferred
Sr. -Senior
Sub. -Subordinated
TOPRS -Trust Originated Preferred Securities
See Notes to Financial Statements.
9
<PAGE> 12
Financials
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1995
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost $200,988,984) $239,858,543
- -----------------------------------------------------------------------------------------
Foreign currencies, at market value (cost $76,411) 78,596
- -----------------------------------------------------------------------------------------
Receivables for:
Investments sold 14,300
- -----------------------------------------------------------------------------------------
Fund shares sold 940,967
- -----------------------------------------------------------------------------------------
Dividends and interest 1,876,536
- -----------------------------------------------------------------------------------------
Investment for deferred compensation plan 6,301
- -----------------------------------------------------------------------------------------
Other assets 16,405
- -----------------------------------------------------------------------------------------
Total assets 242,791,648
- -----------------------------------------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 384,923
- -----------------------------------------------------------------------------------------
Fund shares reacquired 443,166
- -----------------------------------------------------------------------------------------
Dividends 207,065
- -----------------------------------------------------------------------------------------
Deferred compensation 6,301
- -----------------------------------------------------------------------------------------
Accrued advisory fees 118,295
- -----------------------------------------------------------------------------------------
Accrued administrative service fees 6,095
- -----------------------------------------------------------------------------------------
Accrued distribution fees 180,237
- -----------------------------------------------------------------------------------------
Accrued trustees' fees 1,749
- -----------------------------------------------------------------------------------------
Accrued transfer agent fees 59,966
- -----------------------------------------------------------------------------------------
Accrued operating expenses 66,166
- -----------------------------------------------------------------------------------------
Total liabilities 1,473,963
- -----------------------------------------------------------------------------------------
Net assets applicable to shares outstanding $241,317,685
=========================================================================================
NET ASSETS:
Class A $170,624,327
=========================================================================================
Class B $ 70,693,358
=========================================================================================
SHARES OUTSTANDING, $0.01 PAR VALUE PER SHARE:
Class A 11,692,658
=========================================================================================
Class B 4,841,504
=========================================================================================
Class A:
Net asset value and redemption price per share $ 14.59
=========================================================================================
Offering price per share:
(Net asset value of $14.59 divided by 94.50%) $ 15.44
=========================================================================================
Class B:
Net asset value and offering price per share $ 14.60
=========================================================================================
</TABLE>
See Notes to Financial Statements.
10
<PAGE> 13
Financials
STATEMENT OF OPERATIONS
For the year ended December 31, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $171,262 foreign withholding tax) $ 8,322,065
- ----------------------------------------------------------------------------------------
Interest 3,112,023
- ----------------------------------------------------------------------------------------
Total investment income 11,434,088
- ----------------------------------------------------------------------------------------
EXPENSES:
Advisory fees 1,256,220
- ----------------------------------------------------------------------------------------
Administrative service fees 69,813
- ----------------------------------------------------------------------------------------
Custodian fees 75,497
- ----------------------------------------------------------------------------------------
Trustees' fees 6,543
- ----------------------------------------------------------------------------------------
Distribution fees -- Class A 393,486
- ----------------------------------------------------------------------------------------
Distribution fees -- Class B 538,479
- ----------------------------------------------------------------------------------------
Transfer agent fees -- Class A 372,608
- ----------------------------------------------------------------------------------------
Transfer agent fees -- Class B 136,007
- ----------------------------------------------------------------------------------------
Other 115,422
- ----------------------------------------------------------------------------------------
Total expenses 2,964,075
- ----------------------------------------------------------------------------------------
Net investment income 8,470,013
- ----------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENT SECURITIES AND FOREIGN
CURRENCY TRANSACTIONS:
NET REALIZED GAIN (LOSS) FROM:
Investment securities 1,019,826
- ----------------------------------------------------------------------------------------
Foreign currency transactions (82,071)
- ----------------------------------------------------------------------------------------
937,755
- ----------------------------------------------------------------------------------------
UNREALIZED APPRECIATION OF:
Investment securities 42,915,013
- ----------------------------------------------------------------------------------------
Foreign currencies 24,897
- ----------------------------------------------------------------------------------------
42,939,910
- ----------------------------------------------------------------------------------------
Net gain from investment securities and foreign currencies 43,877,665
- ----------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $52,347,678
========================================================================================
</TABLE>
See Notes to Financial Statements.
11
<PAGE> 14
Financials
STATEMENT OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
OPERATIONS:
Net investment income $ 8,470,013 $ 9,265,901
- -------------------------------------------------------------------------------------------
Net realized gain (loss) on sales of investment
securities and foreign currencies 937,755 (19,935,052)
- -------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investment
securities and foreign currencies 42,939,910 (15,936,523)
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 52,347,678 (26,605,674)
- -------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A (6,295,577) (8,024,593)
- -------------------------------------------------------------------------------------------
Class B (1,690,557) (1,429,850)
- -------------------------------------------------------------------------------------------
Returns of capital:
Class A -- (407,762)
- -------------------------------------------------------------------------------------------
Class B -- (72,656)
- -------------------------------------------------------------------------------------------
Share transactions-net:
Class A (12,765,899) (18,722,360)
- -------------------------------------------------------------------------------------------
Class B 16,638,939 24,437,899
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 48,234,584 (30,824,996)
- -------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 193,083,101 223,908,097
- -------------------------------------------------------------------------------------------
End of period $241,317,685 $193,083,101
===========================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $221,523,475 $217,650,435
- -------------------------------------------------------------------------------------------
Undistributed net investment income 404,516 --
- -------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) on sales of
investment securities and foreign currencies (19,477,538) (20,494,656)
- -------------------------------------------------------------------------------------------
Unrealized appreciation (depreciation) of investment
securities and foreign currencies 38,867,232 (4,072,678)
- -------------------------------------------------------------------------------------------
$241,317,685 $193,083,101
===========================================================================================
</TABLE>
See Notes to Financial Statements.
12
<PAGE> 15
Financials
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
AIM Global Utilities Fund (the "Fund") is a series portfolio of AIM Funds Group
(the "Trust"). The Trust is a Delaware business trust registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end
series management investment company consisting of nine separate series
portfolios, each having an unlimited number of shares of beneficial interest.
The Fund currently offers two different classes of shares: the Class A shares
and the Class B shares. Class A shares are sold with a front-end sales charge.
Class B shares are sold with a contingent deferred sales charge. Matters
affecting each portfolio or class will be voted on exclusively by the
shareholders of such portfolio or class. The assets, liabilities and operations
of each portfolio are accounted for separately. Information presented in these
financial statements pertains only to the Fund. The Fund's objective is to
achieve a high level of current income, and as a secondary objective the Fund
seeks to achieve capital appreciation, by investing primarily in the common and
preferred stocks of public utility companies.
The following is a summary of significant accounting policies 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 at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. Security Valuations - Equity securities listed or traded on an exchange are
valued at its last sales price on the exchange where the security is
principally traded, or lacking any sales on a particular day, the security is
valued at the mean between the closing bid and asked prices on that day. If a
mean is not available, as is the case in some foreign markets, the closing
bid will be used absent a last sales price. Exchange listed convertible bonds
are valued at the mean between the closing bid and asked prices obtained from
a broker-dealer. Each security traded in the over-the-counter market (but not
including securities reported on the NASDAQ National Market System) is valued
at the mean between the last bid and asked prices based upon quotes furnished
by market makers for such securities. Each security reported on the NASDAQ
National Market System is valued at the last sales price on the valuation
date or absent a last sales price, at the closing bid and asked prices. Non-
convertible bonds and notes are valued on the basis of prices provided by an
independent pricing service. Prices provided by the pricing service may be
determined without exclusive reliance on quoted prices, and may reflect
appropriate factors such as institution-size trading in similar groups of
securities, developments related to special securities, yield, quality,
coupon rate, maturity, type of issue, individual trading characteristics and
other market data. Securities for which market quotations either are not
readily available or are questionable are valued at fair value as determined
in good faith by or under the supervision of the Trust's officers in a manner
specifically authorized by the Board of Trustees. Short-term obligations
having 60 days or less to maturity are valued at amortized cost which
approximates market value. Generally, trading in foreign securities is
substantially completed each day at various times prior to the close of the
New York Stock Exchange. The values of such securities used in computing the
net asset value of the Fund's shares are determined as of such times. Foreign
currency exchange rates are also generally determined prior to the close of
the New York Stock Exchange. Occasionally, events affecting the values of
such securities and such exchange rates may occur between the times at which
they are determined and the close of the New York Stock Exchange which will
not be reflected in the computation of the Fund's net asset value. If events
materially affecting the value of such securities occur during the period,
then these securities will be valued at their fair value as determined in
good faith by or under the supervision of the Board of Trustees.
B. Securities Transactions, Investment Income and Distributions - Securities
transactions are accounted for on a trade date basis. Realized gains or
losses on sales are computed on the basis of specific identification of the
securities sold. Interest income is recorded as earned from settlement date
and is recorded on the accrual basis. Dividend income is recorded on the
ex-dividend date. It is the policy of the Fund to declare daily dividends
from net investment income. Such dividends are paid monthly. Distributions
from net realized capital gains, if any, are recorded on ex-dividend date and
are paid annually. On December 31, 1995, undistributed net realized gain
(loss) was increased and undistributed net investment income reduced by
$79,363 in order to comply with the requirements of the American Institute of
Certified Public Accountants Statement of Position 93-2. Net assets of the
Fund were unaffected by the reclassification discussed above.
C. Foreign Currency Translations - Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollar
amounts at date of valuation. Purchases and sales of portfolio
13
<PAGE> 16
Financials
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (continued)
securities and income items denominated in foreign currencies are translated
into U.S. dollar amounts on the respective dates of such transactions.
D. Foreign Currency Contracts - A forward currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a forward contract to attempt to minimize the
risk to the Fund from adverse changes in the relationship between currencies.
The Fund may also enter into a forward contract for the purchase or sale of a
security denominated in a foreign currency in order to "lock in" the U.S.
dollar price of that security. The Fund could be exposed to risk if
counterparties to the contracts are unable to meet the terms of their
contracts or if the value of the foreign currency changes unfavorably.
E. Federal Income Taxes - The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income taxes
is recorded in the financial statements. The Fund has a capital loss
carryforward of $19,221,729 (which may be carried forward to offset future
taxable capital gains, if any) which expires, if not previously utilized, in
the year 2002.
F. Expenses - Operating expenses directly attributable to a class of shares are
charged to that class' operations. Expenses which are applicable to both
classes, e.g. advisory fees, are allocated between them.
NOTE 2 - ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Trust has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at an annual rate of 0.60% of
the first $200 million of the Fund's average daily net assets, plus 0.50% of the
Fund's average daily net assets in excess of $200 million to and including $500
million, plus 0.40% of the Fund's average daily net assets in excess of $500
million to and including $1 billion, plus 0.30% of the Fund's average daily net
assets in excess of $1 billion. This agreement requires AIM to reduce its fees
or, if necessary, make payments to the Fund to the extent required to satisfy
any expense limitations imposed by the securities laws or regulations thereunder
of any state in which the Fund's shares are qualified for sale.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the year ended December 31, 1995, AIM
was reimbursed $69,813 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency and
shareholder services to the Fund. During the year ended December 31, 1995, AFS
was paid $356,054 for such services.
The Trust has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A shares and the Class B shares of the Fund. The Trust has adopted Plans
pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund's Class A
shares (the "Class A Plan") and with respect to the Fund's Class B shares (the
"Class B Plan")(collectively, the "Plans"). The Fund, pursuant to the Class A
Plan, pays AIM Distributors compensation at an annual rate of 0.25% of the
average daily net assets attributable to the Class A shares. The Class A Plan is
designed to compensate AIM Distributors for certain promotional and other sales
related costs and provides for payments to selected dealers and financial
institutions who furnish continuing personal shareholder services to their
customers who purchase and own Class A shares of the Fund. The Fund, pursuant to
the Class B Plan, pays AIM Distributors compensation at an annual rate of 1.00%
of the average daily net assets attributable to the Class B shares. Of this
amount, the Fund may pay a service fee of 0.25% of the average daily net assets
of the Class B shares to selected dealers and financial institutions who furnish
continuing personal shareholder services to their customers who purchase and own
Class B shares of the Fund. Any amounts not paid as a service fee under such
Plans would constitute an asset-based sales charge. The Plans also impose a cap
on the total sales charges, including asset-based sales charges, that may be
paid by the respective classes. AIM Distributors may, from time to time, assign,
transfer or pledge to one or more assignees, its rights to all or a designated
portion of (a) compensation received by AIM Distributors from the Fund pursuant
to the Class B Plan (but not AIM Distributors' duties and obligations pursuant
to the Class B Plan) and (b) any contingent deferred sales charges payable to
AIM Distributors related to the Class B shares. During the year ended December
31, 1995, the Class A shares and the Class B shares paid AIM Distributors
$393,486 and $538,479, respectively, as compensation under the Plans.
14
<PAGE> 17
Financials
NOTE 2 - ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES (continued)
AIM Distributors received commissions of $106,920 from sales of the Class A
shares of the Fund during the year ended December 31, 1995. Such commissions are
not an expense of the Fund. They are deducted from, and are not included in, the
proceeds from sales of Class A shares. During the year ended December 31, 1995,
AIM Distributors received $167,444 in contingent deferred sales charges imposed
on redemptions of Fund shares. Certain officers and trustees of the Trust are
officers and directors of AIM, AIM Distributors and AFS.
During the year ended December 31, 1995, the Fund paid legal fees of $3,232
for services rendered by Kramer, Levin, Naftalis, Nessen, Kamin & Frankel as
counsel to the Board of Trustees. A member of that firm is a trustee of the
Trust.
NOTE 3 - TRUSTEES' FEES
Trustees' fees represent remuneration paid or accrued to each trustee who is not
an "interested person" of AIM. The Trust may invest trustees' fees, if so
elected by a trustee, in mutual fund shares in accordance with a deferred
compensation plan.
NOTE 4 - BANK BORROWINGS
The Fund has a $3,600,000 committed line of credit with a financial institution
syndicate with Chemical Bank of New York as the administrative agent. Interest
on borrowings under the line of credit is payable on maturity or prepayment
date. During the period July 20, 1995 (effective date of line of credit
agreement) through December 31, 1995, the Fund did not borrow under the line of
credit agreement. The Fund is charged a commitment fee, payable quarterly, at
the rate of 1/10 of 1% per annum on the unused balance of the Fund's committed
line.
NOTE 5 - INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the year ended December 31, 1995 was
$188,852,283 and $178,842,299, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
on a tax basis, as of December 31, 1995 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of investment securities $40,760,598
- -----------------------------------------------------------------------------------------------------------
Aggregate unrealized (depreciation) of investment securities (2,119,248)
- -----------------------------------------------------------------------------------------------------------
Net unrealized appreciation of investment securities $38,641,350
===========================================================================================================
</TABLE>
Cost of investments for tax purposes is $201,217,193.
NOTE 6 - SHARE INFORMATION
Changes in shares outstanding during the years ended December 31, 1995 and 1994
were as follows:
<TABLE>
<CAPTION>
1995 1994
------------------------ -----------------------
SHARES VALUE SHARES VALUE
--------- ---------- -------- ----------
<S> <C> <C> <C> <C>
Sold:
Class A 3,040,993 $39,908,471 4,097,001 $52,451,904
- ------------------------------------------------------------------------------------------------------------
Class B 2,223,714 29,286,592 2,720,021 34,681,563
- ------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class A 417,851 5,505,279 572,553 7,178,342
- ------------------------------------------------------------------------------------------------------------
Class B 106,557 1,413,598 99,414 1,232,102
- ------------------------------------------------------------------------------------------------------------
Reacquired:
Class A (4,470,353) (58,179,649) (6,158,134) (78,352,606)
- ------------------------------------------------------------------------------------------------------------
Class B (1,083,006) (14,061,251) (921,686) (11,475,766)
- ------------------------------------------------------------------------------------------------------------
235,756 $3,873,040 409,169 $5,715,539
============================================================================================================
</TABLE>
15
<PAGE> 18
Financials
NOTE 7 - FINANCIAL HIGHLIGHTS
Shown below are the condensed financial highlights for a Class A share
outstanding during each of the years in the seven-year period ended December 31,
1995 and the period January 18, 1988 (date operations commenced) through
December 31, 1988 and for a Class B share outstanding during each of the years
in the two-year period ended December 31, 1995 and the period September 1, 1993
(date sales commenced) through December 31, 1993.
<TABLE>
<CAPTION>
CLASS A SHARES
------------------------------------------------------------------------------------
1995 1994 1993 1992(A) 1991 1990 1989
-------- -------- -------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 11.85 $ 14.09 $ 13.31 $ 13.75 $ 12.45 $ 13.73 $ 10.99
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Income from investment operations:
Net investment income 0.55 0.59 0.60 0.67 0.70 0.66 0.77
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Net gains (losses) on securities
(both realized and unrealized) 2.71 (2.20) 1.02 0.36 2.12 (1.10) 3.06
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Total from investment operations 3.26 (1.61) 1.62 1.03 2.82 (0.44) 3.83
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Less distributions:
Dividends from net investment income (0.52) (0.60) (0.61) (0.68) (0.66) (0.70) (0.69)
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Distributions from net realized
capital gains -- -- (0.23) (0.79) (0.86) (0.14) (0.40)
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Returns of capital -- (0.03) -- -- -- -- --
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Total distributions (0.52) (0.63) (0.84) (1.47) (1.52) (0.84) (1.09)
- ------------------------------------- -------- -------- -------- -------- -------- ------- -------
Net asset value, end of period $ 14.59 $ 11.85 $ 14.09 $ 13.31 $ 13.75 $ 12.45 $ 13.73
===================================== ======== ======== ======== ======== ======== ======= =======
Total return(b) 28.07% (11.57)% 12.32% 7.92% 23.65% (2.98)% 36.11%
===================================== ======== ======== ======== ======== ======== ======= =======
Ratios/supplemental data:
Net assets, end of period (000s
omitted) $170,624 $150,515 $200,016 $111,771 $ 91,939 $69,541 $58,307
===================================== ======== ======== ======== ======== ======== ======= =======
Ratio of expenses to average net
assets 1.21%(c) 1.18% 1.16% 1.17% 1.23% 1.21%(d) 1.05%(d)
===================================== ======== ======== ======== ======== ======== ======= =======
Ratio of net investment income to
average net assets 4.20%(c) 4.67% 4.21% 4.96% 5.36% 5.21%(e) 6.13%(e)
===================================== ======== ======== ======== ======== ======== ======= =======
Portfolio turnover rate 88% 101% 76% 148% 169% 123% 115%
===================================== ======== ======== ======== ======== ======== ======= =======
<CAPTION>
CLASS B SHARES
--------------------------------
1988 1995 1994 1993
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.00 $ 11.84 $ 14.08 $ 15.30
- ------------------------------------- ------- ------- ------- -------
Income from investment operations:
Net investment income 0.82 0.44 0.47 0.17
- ------------------------------------- ------- ------- ------- -------
Net gains (losses) on securities
(both realized and unrealized) 0.83 2.73 (2.19) (0.98)
- ------------------------------------- ------- ------- ------- -------
Total from investment operations 1.65 3.17 (1.72) (0.81)
- ------------------------------------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.66) (0.41) (0.49) (0.17)
- ------------------------------------- ------- ------- ------- -------
Distributions from net realized
capital gains -- -- -- (0.24)
- ------------------------------------- ------- ------- ------- -------
Returns of capital -- -- (0.03) --
- ------------------------------------- ------- ------- ------- -------
Total distributions (0.66) (0.41) (0.52) (0.41)
- ------------------------------------- ------- ------- ------- -------
Net asset value, end of period $ 10.99 $ 14.60 $ 11.84 $ 14.08
===================================== ======= ======= ======= =======
Total return(b) 17.03% 27.16% (12.35)% (5.32)%
===================================== ======= ======= ======= =======
Ratios/supplemental data:
Net assets, end of period (000s
omitted) $20,104 $70,693 $42,568 $23,892
===================================== ======= ======= ======= =======
Ratio of expenses to average net
assets 1.22%(d)(f) 1.97%(c) 2.07% 1.99%(f)
===================================== ======= ======= ======= =======
Ratio of net investment income to
average net assets 7.63%(e)(f) 3.44%(c) 3.78% 3.38%(f)
===================================== ======= ======= ======= =======
Portfolio turnover rate 87% 88% 101% 76%
===================================== ======= ======= ======= =======
</TABLE>
(a) The Fund changed investment advisors on June 30, 1992.
(b) Total returns do not deduct sales charges and for periods less than one year
are not annualized.
(c) Ratios for Class A are based on average daily net assets of $157,394,436.
Ratios for Class B are based on average daily net assets of $53,847,853.
(d) Ratios of expenses to average net assets prior to reduction of advisory fees
were 1.22%, 1.11% and 1.69% (annualized) for 1990-88, respectively.
(e) Ratios of net investment income to average net assets prior to reduction of
advisory fees were 5.20%, 6.07% and 7.16% (annualized) for 1990-88,
respectively.
(f) Annualized.
INDEPENDENT AUDITORS' REPORT
To the Board of Trustees and Shareholders of
AIM Global Utilities Fund:
We have audited the accompanying statement of assets and liabilities of AIM
Global Utilities Fund (a portfolio of AIM Funds Group), including the schedule
of investments, as of December 31, 1995, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of the
years in the two-year period then ended and the financial highlights for each of
the years in the three-year period then ended. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of AIM
Global Utilities Fund as of December 31, 1995, the results of its operations for
the year then ended, the statement of changes in its net assets for each of the
years in the two-year period then ended and financial highlights for each of the
years in the three-year period then ended, in conformity with generally accepted
accounting principles.
Houston, Texas KPMG Peat Marwick LLP
February 7, 1996
16
<PAGE> 19
Trustees
& Officers
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TRUSTEES OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman and Chief Executive Officer Chairman Suite 1919
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director, President and
Chief Executive Officer John J. Arthur A I M Advisors, Inc.
COMSAT Corporation Senior Vice President & Treasurer 11 Greenway Plaza
Suite 1919
Owen Daly II Gary T. Crum Houston, TX 77046
Director Senior Vice President
Cortland Trust Inc. DISTRIBUTOR
Carol F. Relihan
Carl Frischling Vice President & Secretary A I M Distributors, Inc.
Partner 11 Greenway Plaza
Kramer, Levin, Naftalis, Nessen, Dana R. Sutton Suite 1919
Kamin & Frankel Vice President & Assistant Treasurer Houston, TX 77046
Robert H. Graham Robert G. Alley CUSTODIAN
President and Chief Operating Officer Vice President
A I M Management Group Inc. State Street Bank and Trust
Stuart W. Coco Company
John F. Kroeger Vice President 225 Franklin Street
Formerly, Consultant Boston, MA 02110
Wendell & Stockel Associates, Inc. Melville B. Cox
Vice President TRANSFER AGENT
Lewis F. Pennock
Attorney Karen Dunn Kelley A I M Fund Services, Inc.
Vice President P.O. Box 4739
Ian W. Robinson Houston, TX 77210-4739
Consultant; Former Executive Vice Jonathan C. Schoolar
President and Chief Financial Officer Vice President AUDITORS
Bell Atlantic Management Services, Inc.
P. Michelle Grace KPMG Peat Marwick LLP
Louis S. Sklar Assistant Secretary 700 Louisiana
Executive Vice President NationsBank Bldg.
Hines Interests David L. Kite Houston, TX 77002
Limited Partnership Assistant Secretary
LEGAL COUNSEL TO FUND
Nancy L. Martin
Assistant Secretary Ballard Spahr Andrews &
Ingersoll
Ofelia M. Mayo 1735 Market Street
Assistant Secretary Philadelphia, PA 19103
Kathleen J. Pflueger LEGAL COUNSEL TO TRUSTEES
Assistant Secretary
Kramer, Levin, Naftalis, Nessen,
Samuel D. Sirko Kamin & Frankel
Assistant Secretary 919 Third Avenue
New York, NY 10022
Stephen I. Winer
Assistant Secretary
Mary J. Benson
Assistant Treasurer
</TABLE>
Required Federal Income Tax Information
AIM Global Utilities Fund Class A and Class B shares paid ordinary dividends in
the amount of $0.522 and $0.4065 per share, respectively, to shareholders
during its tax year ended December 31, 1995. Of these amounts, 81% is eligible
for the dividends received deduction for corporations. Missouri residents:
During the Fund's tax year ended December 31, 1995, 7% of the Fund's income was
derived from U.S. Treasury obligations.
<PAGE> 20
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[PHOTO OF 11 GREENWAY PLAZA] THE AIM FAMILY OF FUNDS(R)
<S> <C>
AGGRESSIVE GROWTH
AIM Aggressive Growth Fund*
AIM Constellation Fund
AIM Global Aggressive Growth Fund
GROWTH
AIM Global Growth Fund
AIM Growth Fund
AIM International Equity Fund
AIM Value Fund
AIM Weingarten Fund
GROWTH AND INCOME
AIM Balanced Fund
AIM Charter Fund
INCOME AND GROWTH
AIM Global Utilities Fund**
HIGH CURRENT INCOME
AIM High Yield Fund
CURRENT INCOME
AIM Global Income Fund
AIM Income Fund
CURRENT TAX-FREE INCOME
AIM Municipal Bond Fund
AIM Tax-Exempt Bond Fund of CT
AIM Tax-Free Intermediate Shares
CURRENT INCOME AND HIGH DEGREE
OF SAFETY
AIM Intermediate Government Fund***
HIGH DEGREE OF SAFETY AND
CURRENT INCOME
AIM Limited Maturity Treasury Shares
STABILITY, LIQUIDITY, AND
CURRENT INCOME
AIM Money Market Fund
STABILITY, LIQUIDITY, AND
CURRENT TAX-FREE INCOME
AIM Tax-Exempt Cash Fund*
AIM Aggressive Growth Fund was closed to new
investors on July 18, 1995. **On May 1, 1995,
AIM Management Group has provided leadership AIM Utilities Fund broadened its investment
in the mutual fund industry since 1976 and strategy to permit up to 80% of its total assets
currently manages approximately $42 billion to be invested in foreign securities, and was
in assets for more than 2 million shareholders, renamed AIM Global Utilities Fund. ***On
including individual investors, corporate September 25, 1995, AIM Government Securities
clients, and financial institutions. The AIM Fund was renamed AIM Intermediate Government
Family of Funds(R) is distributed nationwide, Fund. For more complete information about any
and AIM today ranks among the nation's top 20 AIM Fund(s), including sales charges and
mutual fund companies in assets under management, expenses, ask your financial consultant or
according to Lipper Analytical Services, Inc. securities dealer for a free prospectus(es).
Please read the prospectus(es) carefully before
you invest or send money.
[AIM LOGO APPEARS HERE] ---------------
BULK RATE
A I M Distributors, Inc. U.S. POSTAGE
11 Greenway Plaza, Suite 1919 PAID
Houston, TX 77046 HOUSTON, TX
Permit No. 1919
---------------
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