<PAGE> 1
SEMIANNUAL REPORT / JUNE 30 1999
AIM MONEY MARKET FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
<PAGE> 2
EXCHANGE PRIVILEGE EXPANDED FOR CASH
RESERVE SHARES OF AIM MONEY MARKET FUND
To expand your options for managing your AIM investment account, AIM has
approved a broadening of the exchange privilege for shareholders of Cash Reserve
Shares of AIM Money Market Fund.
Effective September 1, 1999, you may exchange Cash Reserve Shares which were
purchased (and not acquired through an exchange) into Class B and Class C shares
of any other AIM fund. The Class B and Class C shares acquired may be subject to
a contingent deferred sales charge (CDSC) when redeemed. The CDSC on Class B
shares declines from 5% beginning at the time of purchase to 0% at the beginning
of the seventh year. The CDSC on Class C shares is 1% for the first year after
purchase. The CDSC charged on shares you acquire through an exchange from Cash
Reserve Shares will be calculated based on a period starting on the date you
acquired the Class B or Class C shares.
Class B or Class C shares you acquire through exchange from Cash Reserve
Shares may subsequently be exchanged into the same class of any AIM fund,
including AIM Money Market Fund. They may not be exchanged back into Cash
Reserve Shares.
Please see your financial consultant if you have any questions regarding
this change.
AIM MONEY MARKET FUND
<PAGE> 3
SEMIANNUAL REPORT / CHAIRMAN'S LETTER
Dear Shareholder:
We are pleased to send you this report on AIM Money Market
[PHOTO OF Fund for the six months ended June 30, 1999, a period marked
Charles T. by fears of inflation, broadening U.S. markets and
Bauer, rejuvenated overseas markets.
Chairman of
the Board of INFLATION STILL AT BAY, U.S. ECONOMY STILL GROWING
THE FUND For much of the reporting period, investors and economists
APPEARS HERE] worried that the strong U.S. economy would spark inflation.
U.S. Treasury securities performed poorly because of
heightened concerns that the Federal Reserve Board (the Fed)
would raise interest rates to slow economic growth and combat
inflation. The primary impetus for these concerns was the
dramatic and unexpected rise of consumer prices in April.
Uncertainty concerning how much the Fed might raise
interest rates eroded Treasury prices in May and June,
sending their yields higher. The yield of the benchmark
30-year U.S. Treasury bond soared from 5.09% at the beginning of the reporting
period to 6.16% on June 24, its highest level since 1997.
Speculation surrounding the Fed's possible action did not end until the
central bank raised the federal funds rate from 4.75% to 5% on June 30. The Fed
also made known its shift from a tightening to a neutral bias, indicating that
it planned no further rate hikes in the near future. That sparked a "relief
rally" in the bond market, dropping the yield on the 30-year Treasury to 5.97%
at the close of the reporting period.
The Dow Jones Industrial Average closed above 10,000 in March and beyond
11,000 in May. However, these record-setting performances masked a very narrow
market early in the reporting period. As time went on, though, a dramatic
reversal of this trend began. Markets that had been out of favor in recent
years--small- and mid-sized company stocks, cyclical and value stocks--were
reporting positive earnings that coaxed investors back. As a result, the overall
market in the United States broadened.
FOREIGN MARKETS RECOVERING
The Fed's 1998 rate cuts helped halt the downward spiral that started in Asia
and gave emerging markets--and the global financial system--a big scare last
summer. Asian markets have rallied during recent months, and investor confidence
in Latin America is returning. Some economists also believe that Japan's
financial woes may have bottomed out with markets there on the way back up.
Elsewhere, the debut of Europe's new common currency, the euro, at the
beginning of 1999 went smoothly. But economists are concerned about Europe's
economic outlook because of widely varying growth rates among the euro-zone
countries. And unlike other foreign markets, the performance of European markets
during the past six months has been largely flat.
FUND CONTINUES TO PROVIDE STABILITY
During the reporting period, the fund maintained a weighted average maturity
(WAM) in the 20- to 25-day range. As of June 30, 1999, the WAM stood at 21 days.
This strategy produced competitive yields. As the reporting period closed,
seven-day yields for the fund were 3.26% for Class B and Class C shares and
4.01% for Cash Reserve Shares. Total net assets in the fund stood at $1.23
billion as of June 30.
AIM Money Market Fund seeks to provide as high a level of current income as
possible consistent with preservation of capital and liquidity by investing in
high-quality money market instruments including commercial paper, repurchase
agreements, and U.S. Treasury and U.S. government agency securities. An
investment in the fund is neither insured nor guaranteed by the U.S. government.
There is no assurance that the fund will be able to maintain a stable net asset
value of $1.00 per share.
QUESTIONS? COMMENTS?
If you have any questions or comments about this report on your fund, please
feel free to contact our Client Services department at 800-959-4246. Automated
information about your AIM account is available 24 hours a day on the AIM
Investor Line at 800-246-5463. Or visit our Web site at www.aimfunds.com for
account or fund information.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
------------------------------------
FOR MUCH OF THE
REPORTING PERIOD,
INVESTORS AND
ECONOMISTS WORRIED
THAT THE STRONG U.S.
ECONOMY WOULD
SPARK INFLATION.
------------------------------------
COVER ART:
WATERLILIES
BY CLAUDE MONET
<PAGE> 4
SCHEDULE OF INVESTMENTS
June 30, 1999
(Unaudited)
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
BANK NOTES-1.02%
BANKS (DOMESTIC)-1.02%
Atlantic American Corp.
5.09%(a) (Cost
$12,500,000) 06/01/09 $ 12,500 $ 12,500,000
- ----------------------------------------------------------------
COMMERCIAL PAPER-40.49%(B)
ASSET-BACKED SECURITIES-COMMERCIAL/LOANS/LEASES-3.68%
Centric Capital Corp.
4.81% 07/30/99 20,000 19,922,506
- ----------------------------------------------------------------
4.94% 08/09/99 15,000 14,919,725
- ----------------------------------------------------------------
4.81% 10/04/99 10,600 10,465,454
- ----------------------------------------------------------------
45,307,685
- ----------------------------------------------------------------
ASSET-BACKED SECURITIES-MULTI-PURPOSE-19.44%
Bavaria TRR Corporation
4.97% 07/06/99 20,500 20,485,849
- ----------------------------------------------------------------
5.12% 07/27/99 25,000 24,907,556
- ----------------------------------------------------------------
Clipper Receivables Corp.
4.96% 08/09/99 20,000 19,892,533
- ----------------------------------------------------------------
Edison Asset
Securitization, L.L.C.
4.79% 07/14/99 10,000 9,982,703
- ----------------------------------------------------------------
4.93% 08/27/99 25,000 24,804,854
- ----------------------------------------------------------------
4.85% 09/13/99 13,000 12,870,397
- ----------------------------------------------------------------
Falcon Asset
Securitization Corp.
4.81% 09/20/99 28,500 28,191,559
- ----------------------------------------------------------------
Preferred Receivables Funding Corp.
5.06% 08/11/99 30,000 29,827,117
- ----------------------------------------------------------------
Receivables Capital Corp.
4.93% 08/03/99 24,865 24,752,631
- ----------------------------------------------------------------
4.96% 08/03/99 18,742 18,656,786
- ----------------------------------------------------------------
Sheffield Receivables
Corp.
4.95% 07/22/99 25,000 24,927,885
- ----------------------------------------------------------------
239,299,870
- ----------------------------------------------------------------
ASSET-BACKED SECURITIES-TRADE RECEIVABLES-4.86%
Asset Securitization Cooperative
Corp.
4.92% 08/06/99 20,000 19,901,600
- ----------------------------------------------------------------
5.10% 03/10/99 25,000 24,988,518
- ----------------------------------------------------------------
Ciesco L.P.
5.16% 08/17/99 15,000 14,898,950
- ----------------------------------------------------------------
59,789,068
- ----------------------------------------------------------------
BANKS (DOMESTIC)-2.73%
FCE Bank PLC (United Kingdom)
4.82% 07/15/99 15,000 14,971,883
- ----------------------------------------------------------------
First Chicago Financial
Corp.
4.85% 09/13/99 9,000 8,910,275
- ----------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
BANKS (DOMESTIC)-(CONTINUED)
UBS Finance (Delaware)
Inc.
4.82% 12/23/99 $ 10,000 $ 9,765,694
- ----------------------------------------------------------------
33,647,852
- ----------------------------------------------------------------
METALS (MINING)-4.05%
Rio Tinto America, Inc.
5.00% 07/15/99 30,000 29,941,667
- ----------------------------------------------------------------
U.S. Borax, Inc.
4.81% 08/06/99 20,000 19,903,800
- ----------------------------------------------------------------
49,845,467
- ----------------------------------------------------------------
MULTIPLE INDUSTRY-5.72%
Diageo Capital PLC (United Kingdom)
4.78% 08/31/99 21,000 20,829,912
- ----------------------------------------------------------------
General Electric Capital
Corp.
4.81% 09/07/99 25,000 24,772,861
- ----------------------------------------------------------------
4.83% 09/08/99 25,000 24,768,563
- ----------------------------------------------------------------
70,371,336
- ----------------------------------------------------------------
Total Commercial
Paper (Cost
$498,261,278) 498,261,278
- ----------------------------------------------------------------
TAXABLE MUNICIPAL BONDS-1.60%
HOSPITAL MANAGEMENT-0.79%
Illinois Health
Facilities Authority
(Loyola University
Health Systems);
Revenue Bonds
5.30%(c) 07/01/24 9,699 9,699,999
- ----------------------------------------------------------------
MULTIPLE INDUSTRY-0.81%
Mississippi Business
Finance Corp.
(Mississippi Industrial
Development); Revenue
Bonds
4.92%(c) 02/01/23 10,000 10,000,000
- ----------------------------------------------------------------
Total Taxable
Municipal Bonds
(Cost $19,699,999) 19,699,999
- ----------------------------------------------------------------
MASTER NOTE AGREEMENTS-13.81%
Citicorp Securities, Inc.(d)
6.25% 07/26/99 56,000 56,000,000
- ----------------------------------------------------------------
Merrill Lynch Mortgage Capital,
Inc.(e)
6.28% 08/16/99 55,000 55,000,000
- ----------------------------------------------------------------
Morgan Stanley, Dean
Witter, Discover &
Co.(f)
6.10% 11/22/99 59,000 59,000,000
- ----------------------------------------------------------------
Total Master Note
Agreements (Cost
$170,000,000) 170,000,000
- ----------------------------------------------------------------
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
TIME DEPOSITS-4.06%
Banque Bruxelles Lambert
London
5.25% (Cost
$50,000,000) 07/06/99 $ 50,000 $ 50,000,000
- ----------------------------------------------------------------
Total Investments
(excluding
repurchase
agreements) (Cost
$750,461,277) 750,461,277
- ----------------------------------------------------------------
REPURCHASE AGREEMENTS-35.87%(G)
CIBC Oppenheimer Corp.(h)
4.95% 07/01/99 196,003 196,002,562
- ----------------------------------------------------------------
Dean Witter Reynolds
Inc.(i)
4.85% 07/01/99 45,439 45,438,845
- ----------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MATURITY PAR (000) VALUE
<S> <C> <C> <C>
REPURCHASE AGREEMENTS-(CONTINUED)
Dresdner Kleinwort Benson
North America, LLC(j)
4.95% 07/01/99 $200,000 $ 200,000,000
- ----------------------------------------------------------------
Total Repurchase
Agreements (Cost
$441,441,407) 441,441,407
- ----------------------------------------------------------------
TOTAL INVESTMENTS-96.85% 1,191,902,684(k)
- ----------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-3.15% 38,799,688
- ----------------------------------------------------------------
NET ASSETS-100.00% $1,230,702,372
================================================================
</TABLE>
Notes to Schedule of Investments:
(a) Interest rates are redetermined weekly. Rate shown is the rate in effect on
06/30/99.
(b) Treasury bills and some commercial paper are traded on a discount basis. In
such cases the interest rate shown represents the rate of discount paid or
received at the time of purchase by the Fund.
(c) Demand security; payable upon demand by the Fund with usually no more than
seven calendar days notice. Interest rates are redetermined weekly. Rates
shown are rates in effect on 06/30/99.
(d) The Fund may demand prepayment of notes purchased under the Master Note
Purchase Agreement upon three business days notice. Interest rates on master
notes are redetermined periodically. Rate shown is the rate in effect on
06/30/99.
(e) The Fund may demand prepayment of notes purchased under the Master Note
Purchase Agreement generally upon one business day notice. Interest rates on
master notes are redetermined periodically. Rate shown is the rate in effect
on 06/30/99.
(f) Master Note Purchase Agreement may be terminated by either party upon three
business days prior written notice. Interest rates on master notes are
redetermined periodically. Rate shown is the rate in effect on 06/30/99.
(g) Collateral on repurchase agreements, 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 is at least 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds, private
accounts and certain non-registered investment companies managed by the
investment advisor or its affiliates.
(h) Joint repurchase agreement entered into 06/30/99 with a maturing value of
$300,041,250. Collateralized $538,333,194 by U.S. Government obligations,
5.50% to 6.788% due 12/01/13 to 06/01/37 with an aggregate market value at
06/30/99 of $306,000,000.
(i) Joint repurchase agreement entered into 06/30/99 with a maturing value of
$100,013,472. Collateralized $103,110,000 by U.S. Government obligations, 0%
to 7% due 01/13/04 to 04/28/14 with an aggregate market value at 06/30/99 of
$102,002,666.
(j) Repurchase agreement entered into 06/30/99 with a maturing value of
$200,027,500. Collateralized $343,394,181 by U.S. Government obligations, 0%
to 8.00% due 12/01/99 to 07/01/34 with an aggregate market value at 06/30/99
of $204,000,747.
(k) Also represents cost for federal income tax purposes.
See Notes to Financial Statements.
3
<PAGE> 6
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1999
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, excluding repurchase
agreements, at value (amortized cost) $ 750,461,277
- ----------------------------------------------------------
Repurchase agreements 441,441,407
- ----------------------------------------------------------
Receivables for:
Fund shares sold 69,405,830
- ----------------------------------------------------------
Interest 940,854
- ----------------------------------------------------------
Investment for deferred compensation plan 83,325
- ----------------------------------------------------------
Other assets 425,204
- ----------------------------------------------------------
Total assets 1,262,757,897
- ----------------------------------------------------------
LIABILITIES:
Payables for:
Fund shares reacquired 29,968,279
- ----------------------------------------------------------
Dividends 271,005
- ----------------------------------------------------------
Deferred compensation plan 83,325
- ----------------------------------------------------------
Accrued advisory fees 557,673
- ----------------------------------------------------------
Accrued distribution fees 986,843
- ----------------------------------------------------------
Accrued transfer agent fees 188,400
- ----------------------------------------------------------
Total liabilities 32,055,525
- ----------------------------------------------------------
Net assets applicable to shares
outstanding $1,230,702,372
- ----------------------------------------------------------
NET ASSETS:
AIM Cash Reserve Shares $ 854,624,247
==========================================================
Class B $ 332,955,450
==========================================================
Class C $ 43,122,675
==========================================================
SHARES OUTSTANDING, $0.01 PAR VALUE PER
SHARE:
AIM Cash Reserve Shares 854,599,844
==========================================================
Class B 332,943,176
==========================================================
Class C 43,122,160
==========================================================
AIM Cash Reserve Shares:
Net asset value, offering and redemption
price per share $ 1.00
==========================================================
Class B:
Net asset value and offering price per
share $ 1.00
==========================================================
Class C:
Net asset value and offering price per
share $ 1.00
==========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the six months ended June 30, 1999
(Unaudited)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest $33,766,458
- ---------------------------------------------------------
EXPENSES:
Advisory fees 3,650,851
- ---------------------------------------------------------
Administrative services fees 43,684
- ---------------------------------------------------------
Custodian fees 121,295
- ---------------------------------------------------------
Distribution fees - Class B 1,638,920
- ---------------------------------------------------------
Distribution fees - Class C 185,069
- ---------------------------------------------------------
Distribution fees - AIM Cash Reserve Shares 1,245,456
- ---------------------------------------------------------
Trustees' fees 10,437
- ---------------------------------------------------------
Transfer agent fees - Class B 259,088
- ---------------------------------------------------------
Transfer agent fees - Class C 29,257
- ---------------------------------------------------------
Transfer agent fees - AIM Cash Reserve
Shares 787,551
- ---------------------------------------------------------
Other 484,718
- ---------------------------------------------------------
Total expenses 8,456,326
- ---------------------------------------------------------
Less: Expenses paid indirectly (8,996)
- ---------------------------------------------------------
Net expenses 8,447,330
- ---------------------------------------------------------
Net investment income 25,319,128
- ---------------------------------------------------------
Net realized gain from investments 83
- ---------------------------------------------------------
Net increase in net assets resulting from
operations $25,319,211
=========================================================
</TABLE>
See Notes to Financial Statements.
4
<PAGE> 7
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended June 30, 1999 and the year ended December 31, 1998
(Unaudited)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1999 1998
-------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 25,319,128 $ 46,894,254
- ----------------------------------------------------------------------------------------------
Net realized gain from investments 83 2,781
- ----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 25,319,211 46,897,035
- ----------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A -- (20,797,936)
- ----------------------------------------------------------------------------------------------
Class B (5,112,934) (6,486,731)
- ----------------------------------------------------------------------------------------------
Class C (584,700) (628,599)
- ----------------------------------------------------------------------------------------------
AIM Cash Reserve Shares (19,621,494) (18,980,988)
- ----------------------------------------------------------------------------------------------
Share transactions-net:
Class A -- (375,997,608)
- ----------------------------------------------------------------------------------------------
Class B 22,420,892 194,469,771
- ----------------------------------------------------------------------------------------------
Class C 15,731,835 19,103,703
- ----------------------------------------------------------------------------------------------
AIM Cash Reserve Shares (324,447,095) 834,944,363
- ----------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (286,294,285) 672,523,010
- ----------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 1,516,996,657 844,473,647
- ----------------------------------------------------------------------------------------------
End of period $1,230,702,372 $1,516,996,657
==============================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $1,230,665,181 $1,516,959,549
- ----------------------------------------------------------------------------------------------
Undistributed net realized gain from investments 37,191 37,108
- ----------------------------------------------------------------------------------------------
$1,230,702,372 $1,516,996,657
==============================================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Money Market 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 three different classes of shares: Class B shares, Class C
shares and AIM Cash Reserve Shares. The Fund formerly also offered Class A
shares; however, on December 21, 1998 the Class A shares were reclassified as
AIM Cash Reserve Shares. Class B shares and Class C shares are sold with a
contingent deferred sales charge. AIM Cash Reserve Shares are sold at net asset
value. 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 provide as high a level of current income as is consistent with preservation
of capital and liquidity.
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. The following is a summary of significant accounting policies
followed by the Fund in the preparation of its financial statements.
A. Security Valuations -- The Fund's securities are valued on the basis of
amortized cost which approximates market value. This method values a
security at its cost on the date of purchase and thereafter, assumes a
constant amortization to maturity of any discount or premiums.
B. Securities Transactions, Investment Income and Distributions -- Securities
transactions are accounted for on a
5
<PAGE> 8
trade date basis. Realized gains or losses on sales are computed on the
basis of specific identification of the securities sold. Interest income,
adjusted for amortization of premiums and discounts on investments, is
recorded as earned from settlement date and is recorded on the accrual
basis. Distributions to shareholders are declared daily and paid monthly.
C. 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.
D. Expenses -- Distribution and transfer agency expenses directly attributable
to a class of shares are charged to that class' operations. All other
expenses which are attributable to more than one class are allocated among
the classes.
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 0.55% of
the first $1 billion of the Fund's average daily net assets plus 0.50% of the
Fund's average daily net assets in excess of $1 billion.
The Fund, pursuant to a master administrative services agreement with AIM,
has agreed to pay AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the six months ended June 30, 1999, AIM
was paid $43,684 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") for certain costs incurred in providing
transfer agency and shareholder services to the Fund. During the six months
ended June 30, 1999, the Fund paid AFS $675,048 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 B, Class C and the AIM Cash Reserve Shares of the Fund. The Trust has
adopted distribution plans pursuant to Rule 12b-1 under the 1940 Act with
respect to the Fund's Class C shares and the AIM Cash Reserve Shares (the "Class
C and Cash Reserve Plan"), and the Fund's Class B shares (the "Class B Plan")
(collectively, the "Plans"). The Fund, pursuant to the Class C and Cash Reserve
Plan, pays AIM Distributors compensation at an annual rate of 0.25% of the
average daily net assets of the AIM Cash Reserve Shares, and 1.00% of the
average daily net assets of the Class C shares. 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 of the Class B shares. Of these amounts, the Fund may
pay a service fee of 0.25% of the average daily net assets of the Class B, Class
C or AIM Cash Reserve Shares to selected dealers and financial institutions who
furnish continuing personal shareholder services to their customers who purchase
and own the appropriate class of shares of the Fund. Any amounts not paid as a
service fee under the 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. During the six months ended
June 30, 1999, the Class B, Class C, and AIM Cash Reserve Shares paid AIM
Distributors $1,638,920, $185,069 and $1,245,445, respectively, as compensation
under the Plans.
During the six months ended June 30, 1999, AIM Distributors received
$119,710 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 six months ended June 30, 1999, the Fund paid legal fees of
$3,143 for services rendered by Kramer, Levin, Naftalis & Frankel as counsel to
the Board of Trustees. A member of that firm is a trustee of the Trust.
NOTE 3-INDIRECT EXPENSES
During the six months ended June 30, 1999, the Fund received reductions in
transfer agency fees from AFS (an affiliate of AIM) and reductions in custodian
fees of $8,951 and $45, respectively under expense offset arrangements. The
effect of the above arrangements resulted in a reduction of the Fund's total
expenses of $8,996 during the six months ended June 30, 1999.
NOTE 4-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.
6
<PAGE> 9
NOTE 5-SHARE INFORMATION
Changes in shares outstanding during the six months ended June 30, 1999 and the
year ended December 31, 1998 were as follows:
<TABLE>
<CAPTION>
JUNE 30, 1999 DECEMBER 31, 1998
---------------------------------- -----------------------------------
SHARES AMOUNT SHARES AMOUNT
--------------- --------------- --------------- ----------------
<S> <C> <C> <C> <C>
Sold:
Class A* -- $ -- 12,526,260,894 $ 12,526,260,894
- ------------------------------------------------------------------------------------------------------------------------------
Class B 608,083,051 608,083,051 732,230,888 732,230,888
- ------------------------------------------------------------------------------------------------------------------------------
Class C 243,289,189 243,289,189 350,900,238 350,900,238
- ------------------------------------------------------------------------------------------------------------------------------
AIM Cash Reserve Shares 5,411,215,221 5,411,215,221 6,566,275,190 6,566,275,190
- ------------------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class A* -- -- 15,630,817 15,630,817
- ------------------------------------------------------------------------------------------------------------------------------
Class B 4,223,258 4,223,258 5,684,934 5,684,934
- ------------------------------------------------------------------------------------------------------------------------------
Class C 450,635 450,635 536,206 536,206
- ------------------------------------------------------------------------------------------------------------------------------
AIM Cash Reserve Shares 14,767,566 14,767,566 15,456,154 15,456,154
- ------------------------------------------------------------------------------------------------------------------------------
Issued in connection with acquisitions**:
Class A* -- -- 135,276 135,276
- ------------------------------------------------------------------------------------------------------------------------------
Class B -- -- 72,923,588 72,923,588
- ------------------------------------------------------------------------------------------------------------------------------
Class C -- -- 5,548,897 5,548,897
- ------------------------------------------------------------------------------------------------------------------------------
AIM Cash Reserve Shares -- -- 117,682,745 117,682,745
- ------------------------------------------------------------------------------------------------------------------------------
Reacquired:
Class A* -- -- (12,918,024,595) (12,918,024,595)
- ------------------------------------------------------------------------------------------------------------------------------
Class B (589,885,418) (589,885,418) (616,369,639) (616,369,639)
- ------------------------------------------------------------------------------------------------------------------------------
Class C (228,007,989) (228,007,989) (337,881,638) (337,881,638)
- ------------------------------------------------------------------------------------------------------------------------------
AIM Cash Reserve Shares (5,750,429,881) (5,750,429,881) (5,864,469,726) (5,864,469,726)
- ------------------------------------------------------------------------------------------------------------------------------
(286,294,368) $ (286,294,368) 672,520,229 $ 672,520,229
==============================================================================================================================
</TABLE>
* Class A shares were reclassified to AIM Cash Reserve Shares effective
December 21, 1998.
** The Fund acquired AIM Advisor Cash Management Fund and AIM Dollar Fund on
February 27, 1998 and December 21, 1998, respectively. The acquired funds'
net assets as of the respective closing dates were $5,680,255 and
$190,605,903, respectively. The net assets of the Fund immediately prior to
each acquisition were $701,467,228 and $1,383,530,387, respectively.
NOTE 6-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class B and AIM Cash
Reserve Shares outstanding during the six months ended June 30, 1999 and each of
the years in the five-year period ended December 31, 1998, and for a share of
Class C outstanding during the six months ended June 30, 1999, the year ended
December 31, 1998 and the period August 4, 1997 (date sales commenced) through
December 31, 1997.
<TABLE>
<CAPTION>
CLASS B SHARES
----------------------------------------------------------------
DECEMBER 31,
JUNE 30, ---------------------------------------------------
1999 1998 1997 1996 1995 1994
-------- -------- -------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------ -------- -------- -------- -------- ------- --------
Income from investment operations:
Net investment income 0.0156 0.0371 0.0378 0.0360 0.0419 0.0259
- ------------------------------------------------------------ -------- -------- -------- -------- ------- --------
Less distributions:
Dividends from net investment income (0.0156) (0.0371) (0.0378) (0.0360) (0.0419) (0.0259)
- ------------------------------------------------------------ -------- -------- -------- -------- ------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============================================================ ======== ======== ======== ======== ======= ========
Total return(a) 1.57% 3.78% 3.84% 3.66% 4.27% 2.62%
============================================================ ======== ======== ======== ======== ======= ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $332,955 $310,534 $116,058 $ 91,148 $69,857 $ 33,999
============================================================ ======== ======== ======== ======== ======= ========
Ratio of expenses to average net assets 1.79%(b) 1.81% 1.80% 1.81% 1.78% 1.78%(c)
============================================================ ======== ======== ======== ======== ======= ========
Ratio of net investment income to average net assets 3.17%(b) 3.71% 3.80% 3.60% 4.14% 3.14%(c)
============================================================ ======== ======== ======== ======== ======= ========
</TABLE>
(a) Does not deduct contingent deferred sales charges where applicable and is
not annualized for periods less than one year.
(b) Ratios are annualized and based on average net assets of $330,500,367.
(c) After fee waivers and/or expense reimbursements. Ratios of expenses and net
investment income to average daily net assets prior to fee waivers and/or
expense reimbursements were 1.87% and 3.05%, respectively, for 1994.
7
<PAGE> 10
NOTE 6-FINANCIAL HIGHLIGHTS (continued)
<TABLE>
<CAPTION>
CLASS C SHARES AIM CASH RESERVE SHARES
-------------------------------- ----------------------------------
DECEMBER 31, DECEMBER 31,
JUNE 30, -------------------- JUNE 30, ----------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------- ------- -------- -------- -------- ---------- --------
Income from investment operations:
Net investment income 0.0156 0.0371 0.0158 0.0193 0.0453 0.0456
- ---------------------------------------- ------- -------- -------- -------- ---------- --------
Less distributions:
Dividends from net investment income (0.0156) (0.0371) (0.0158) (0.0193) (0.0453) (0.0456)
- ---------------------------------------- ------- -------- -------- -------- ---------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======================================== ======= ======== ======== ======== ========== ========
Total return(a) 1.57% 3.78% 3.92% 1.95% 4.62% 4.66%
======================================== ======= ======== ======== ======== ========== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $43,123 $ 27,391 $ 8,287 $854,624 $1,179,072 $344,117
======================================== ======= ======== ======== ======== ========== ========
Ratio of expenses to average net assets 1.79%(b) 1.81% 1.80%(c) 1.04%(b) 0.99% 1.05%
======================================== ======= ======== ======== ======== ========== ========
Ratio of net investment income to
average net assets 3.17%(b) 3.71% 3.80%(c) 3.92%(b) 4.53% 4.55%
======================================== ======== ======== ======== ======== ========== ========
<CAPTION>
AIM CASH RESERVE SHARES
--------------------------------
DECEMBER 31,
--------------------------------
1996 1995 1994
-------- -------- --------
<S> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------- -------- -------- --------
Income from investment operations:
Net investment income 0.0433 0.0493 0.0337
- ---------------------------------------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.0433) (0.0493) (0.0337)
- ---------------------------------------- -------- -------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
======================================== ======== ======== ========
Total return(a) 4.41% 5.04% 3.42%
======================================== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $315,470 $293,450 $359,952
======================================== ======== ======== ========
Ratio of expenses to average net assets 1.08% 1.04% 0.99%(d)
======================================== ======== ======== ========
Ratio of net investment income to
average net assets 4.32% 4.92% 3.49%(d)
======================================== ======== ======== ========
</TABLE>
(a) Does not deduct contingent deferred sales charges where applicable and is
annualized for periods less than one year.
(b) Ratios are annualized and based on average net assets of $37,320,572 and
$1,004,621,722 for Class C and AIM Cash Reserve Shares, respectively.
(c) Annualized.
(d) After fee waivers and/or expense reimbursements. Ratios of expenses and net
investment income to average daily net assets prior to fee waivers and/or
expense reimbursements were 1.08% and 3.40%, respectively, for 1994.
8
<PAGE> 11
<TABLE>
<S> <C> <C>
BOARD OF TRUSTEES OFFICERS OFFICE OF THE FUND
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; Carol F. Relihan A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Secretary 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Gary T. Crum Houston, TX 77046
Senior Vice President
Owen Daly II TRANSFER AGENT
Director Dana R. Sutton
Cortland Trust Inc. Vice President and Treasurer A I M Fund Services, Inc.
P.O. Box 4739
Edward K. Dunn Jr. Robert G. Alley Houston, TX 77210-4739
Chairman, Mercantile Mortgage Corp.; Vice President
Formerly Vice Chairman and President, CUSTODIAN
Mercantile-Safe Deposit & Trust Co.; and Stuart W. Coco
President, Mercantile Bankshares Vice President State Street Bank and Trust Company
225 Franklin Street
Jack Fields Melville B. Cox Boston, MA 02110
Chief Executive Officer Vice President
Texana Global, Inc.; COUNSEL TO THE FUND
Formerly Member Karen Dunn Kelley
of the U.S. House of Representatives Vice President Ballard Spahr
Andrews & Ingersoll, LLP
Carl Frischling Edgar M. Larsen 1735 Market Street
Partner Vice President Philadelphia, PA 19103
Kramer, Levin, Naftalis & Frankel LLP
Mary J. Benson COUNSEL TO THE TRUSTEES
Robert H. Graham Assistant Vice President and
President and Chief Executive Officer Assistant Treasurer Kramer, Levin, Naftalis & Frankel LLP
A I M Management Group Inc. 919 Third Avenue
Sheri Morris New York, NY 10022
Prema Mathai-Davis Assistant Vice President and
Chief Executive Officer, YWCA of the U.S.A., Assistant Treasurer DISTRIBUTOR
Commissioner, New York City Dept. for
the Aging; and member of the Board of Directors, Renee A. Friedli A I M Distributors, Inc.
Metropolitan Transportation Authority of Assistant Secretary 11 Greenway Plaza
New York State Suite 100
P. Michelle Grace Houston, TX 77046
Lewis F. Pennock Assistant Secretary
Attorney
Jeffrey H. Kupor
Louis S. Sklar Assistant Secretary
Executive Vice President
Hines Interests Nancy L. Martin
Limited Partnership Assistant Secretary
Ofelia M. Mayo
Assistant Secretary
Lisa A. Moss
Assistant Secretary
Kathleen J. Pflueger
Assistant Secretary
Samuel D. Sirko
Assistant Secretary
Stephen I. Winer
Assistant Secretary
</TABLE>
This report may be distributed only to current shareholders or to persons
who have received a current effective prospectus of the Fund.
<PAGE> 12
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc. has
AIM Aggressive Growth Fund(1) AIM Money Market Fund provided leadership in the mutual-fund
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund industry since 1976 and managed
AIM Capital Development Fund approximately $121 billion in assets
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS for more than 6.3 million
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund shareholders, including individual
AIM Large Cap Growth Fund AIM Asian Growth Fund investors, corporate clients and
AIM Mid Cap Equity Fund(A) AIM Developing Markets Fund financial institutions, as of June
AIM Select Growth Fund AIM Europe Growth Fund 30, 1999.
AIM Small Cap Growth Fund(B) AIM European Development Fund The AIM Family of Funds--Registered
AIM Small Cap Opportunities Fund AIM International Equity Fund Trademark-- is distributed nationwide,
AIM Value Fund AIM Japan Growth Fund and AIM today is the 10th-largest mutual-
AIM Weingarten Fund AIM Latin American Growth Fund fund complex in the United States in
AIM New Pacific Growth Fund assets under management, according
GROWTH & INCOME FUNDS to Strategic Insight, an independent
AIM Advisor Flex Fund GLOBAL GROWTH FUNDS mutual-fund monitor.
AIM Advisor Large Cap Value Fund AIM Global Aggressive Growth Fund
AIM Advisor Real Estate Fund AIM Global Growth Fund
AIM Balanced Fund
AIM Basic Value Fund(C) GLOBAL GROWTH & INCOME FUNDS
AIM Charter Fund AIM Global Growth & Income Fund
AIM Global Utilities Fund
INCOME FUNDS
AIM Floating Rate Fund GLOBAL INCOME FUNDS
AIM High Yield Fund AIM Emerging Markets Debt Fund(D)
AIM High Yield Fund II AIM Global Government Income Fund
AIM Income Fund AIM Global Income Fund
AIM Intermediate Government Fund AIM Strategic Income Fund
AIM Limited Maturity Treasury Fund
THEME FUNDS
TAX-FREE INCOME FUNDS AIM Global Consumer Products and Services Fund
AIM High Income Municipal Fund AIM Global Financial Services Fund
AIM Municipal Bond Fund AIM Global Health Care Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Infrastructure Fund
AIM Tax-Free Intermediate Fund AIM Global Resources Fund
AIM Global Telecommunications and Technology Fund(E)
AIM Global Trends Fund(F)
</TABLE>
(1) AIM Aggressive Growth Fund reopened to new investors November 16, 1998.
(A)On September 8, 1998, AIM Mid Cap Growth Fund was renamed AIM Mid Cap Equity
Fund. (B) On September 8, 1998, AIM Small Cap Equity Fund was renamed AIM Small
Cap Growth Fund. (C) On September 8, 1998, AIM America Value Fund was renamed
AIM Basic Value Fund. (D) On September 8, 1998, AIM Global High Income Fund was
renamed AIM Emerging Markets Debt Fund. (E) On June 1, 1999, AIM Global
Telecommunications Fund was renamed AIM Global Telecommunications and Technology
Fund. (F) On September 8, 1998, AIM New Dimension Fund was renamed AIM Global
Trends Fund. For more complete information about any AIM Fund(s), including
sales charges and expenses, ask your financial consultant or securities dealer
for a free prospectus(es). Please read the prospectus(es) carefully before you
invest or send money.
[AIM LOGO APPEARS HERE]
INVEST WITH DISCIPLINE--Registered Trademark--
