<PAGE>
G.T. GROUP
[LOGO]
TWENTY-FIVE
YEARS OF
PROVIDING
ACCESS TO
GLOBAL MARKETS
/ /
G.T. GLOBAL
EUROPE
GROWTH FUND
/ /
SEMIANNUAL REPORT
JUNE 30, 1995
<PAGE>
TABLE
OF CONTENTS
<TABLE>
<S> <C>
Report from the Fund
Managers and Key
Portfolio Holdings..... 1
Financial Statements... F-1
</TABLE>
<PAGE>
REPORT FROM THE FUND MANAGERS
The G.T. Global Europe Growth Fund seeks to achieve long-term capital growth by
investing in the equity securities of eastern and western European countries.
PERFORMANCE REVIEW
Total return for the six months ended June 30, 1995, for Class A shares was
3.89% (-1.05% with the maximum sales charge of 4.75%). Total return for the same
time period for Class B shares was 3.61% (-1.39% with the maximum 5% contingent
deferred sales charge). Total return for the Morgan Stanley Capital
International (MSCI) Europe Index(1) was 13.11% for the period. For additional
performance information, please see page 6.
The Fund's performance was adversely affected by its exposure to cyclical
companies (those whose earnings typically go up and down with the economy), in
particular the German auto companies, which suffered from a lowering of economic
growth forecasts and a strengthening of the deutschemark. Stock selection in
Spain was also poor and market liquidity dried up in a couple of our Spanish
holdings.
The Fund's defensive currency management policy also detracted from performance
as the anticipated strengthening of the dollar failed to materialize. As
provided in the Fund's prospectus, the Fund may attempt to hedge against adverse
movements in currency exchange rates by entering into forward contracts for the
purchase or sale of a specified currency at a specified future date. Our
strategy has been to hedge against a strong U.S. dollar. When the dollar
weakens, as it did over the period, Fund performance is adversely affected.
In the latter half of the period, the Fund benefited from its holdings in
selected growth companies notably SAP,(2) a German corporate software company,
Ericsson and Nokia, telecommunication equipment suppliers, and Hornbach, a
German do-it-yourself retailer. This led to an outperformance of the Fund
against the MSCI Index in the second quarter, but was not enough to recoup the
ground lost in the first quarter.
--------------
(1) The MSCI Europe Index is an arithmetic average, weighted by market value, of
the performance of 597 securities listed on 14 major European stock
exchanges (Austria, Belgium, Denmark, Finland, France, Germany, Ireland,
Italy, the Netherlands, Norway, Spain, Sweden, Switzerland and the United
Kingdom). It includes the effect of reinvested dividends and is measured in
U.S. dollars.
(2) There can be no assurance the Fund will continue to hold this or any other
security mentioned in this report.
1
<PAGE>
PORTFOLIO STRATEGY
The Fund reduced its cyclical exposure significantly over the period as low
economic growth across Europe and a slowing of the rate of growth in the U.S.
became apparent. We anticipated May's peaking of commodity prices and sold our
paper and chemical holdings. We bought selective growth companies such as
Autoliv, a Swedish airbag manufacturer, and SAP.
MARKET REVIEW
In spite of downward revisions in corporate earnings, lower economic forecasts
and a weak dollar, European equity markets rallied over the six month period,
producing double digit dollar returns. The return of investor confidence was
driven by the strength in global bond markets on the back of a benign outlook
for inflation. Investors sought earnings growth and were prepared to pay a
higher premium for it. This favored markets such as Switzerland, Sweden and
Finland. On the other hand, Italy suffered severely for its lack of political
stability and fiscal rectitude and the German market was hit by negative
revisions for export earnings. In terms of sectors, economically sensitive
sectors (where demand is driven by gross domestic product, such as housing,
retailing and banking) lagged the index in the face of lower growth, while
relative safe havens such as pharmaceuticals (where growth is fairly constant)
did well.
In the UK, both the stock and bond markets strengthened over the period. Falling
bond yields reflected continuing evidence of a slowdown in the domestic UK
economy, including weak figures for industrial production, housing and car sales
and retail sales. Although inflation has edged up, the perception is that it is
very much under control. All this has led to much-improved expectations
concerning interest rates and has driven both bond and equity markets.
OUTLOOK
We consider the benign outlook for inflation coupled with low economic growth as
providing a favorable backdrop for European bond markets. We envisage a further
reduction in European bond yields from current high levels which, at least
historically, has been good for equities. In terms of corporate earnings, we
believe the bulk of downward revisions on the back of lower volume growth and a
weaker dollar has already occurred; equity valuations are therefore looking more
robust.
We expect European equity markets to also benefit from improved communication of
financial information and the recognition by companies of shareholder value.
Slow but perceptible progress is being made and has already been rewarded in
2
<PAGE>
more open markets such as the Netherlands by a rerating of shares. Longer-term
trends which are supportive of European equities include the reform of the
pension fund market in countries such as France and Italy, which we believe will
create incremental demand for equities, and the demise of the unions'
stranglehold on the labor market, which we expect to result in greater
productivity in the corporate sector.
CHRISTIAN WIGNALL ANNA POWELL
CHIEF INVESTMENT OFFICER PORTFOLIO MANAGER
GLOBAL EQUITIES LONDON
SAN FRANCISCO
JULY 14, 1995
Notice to shareholders: To reduce Fund expenses, only one copy of this report is
being mailed to each address, even if there is more than one account at that
address. For additional copies of this report, please call 1-800-223-2138.
G.T. GLOBAL EUROPE GROWTH FUND
3
<PAGE>
KEY PORTFOLIO HOLDINGS*
S.G. WARBURG GROUP PLC UK
S.G. Warburg is the UK's largest merchant bank in terms of total assets and is
widely regarded as one of the highest-quality companies within the industry.
Warburg's particular strength is corporate finance in which it ranked first for
worldwide (excluding U.S. domestic) merger and acquisition advisory deals and
first in UK public and private deals in 1994. In addition, SGW owns 75% of
Mercury Asset Management, making it the largest pension fund manager in the UK.
BARCLAYS PLC UK
Barclays is a major UK banking services group with a strong brokerage division.
Recent management changes have led to the sale of underperforming assets. In
light of this, we expect a gradual improvement in investor sentiment with the
company benefiting from a rerating of the UK banking sector.
ELSEVIER N.V. HOLLAND
This Dutch publishing company focuses on the scientific, professional and
business markets. It has enjoyed strong growth from geographical expansion and
from electronic publishing. Elsevier recently acquired LEXIS-NEXIS, the on-line
legal and business information service company, which we expect will enhance its
earnings growth.
PEARSON PLC UK
Pearson is now one of the largest media groups in the UK. The Group has stakes
in British television and a number of family entertainment businesses. It also
owns the Financial Times group and other UK and U.S. publishing concerns. Most
recently, the group acquired Software Toolworks, a U.S. consumer software
company. Over the last few years, the firm's shift in strategy, from a diverse
conglomerate to a media-focused group, has been welcomed by the market.
COMPASS GROUP PLC UK
Compass is a market leader in the UK institutional catering business and through
an aggressive acquisition strategy has achieved dominant positions throughout
Europe and in the U.S. It holds strong branded franchises, such as Burger King
and Pizza Hut, and has an excellent record for managing growth, both internally
and by acquisition.
------------------
* There is no assurance the Fund will continue to hold these securities.
4
<PAGE>
NATIONAL WESTMINSTER BANK PLC (NATWEST) UK
Natwest is a major clearing bank in the UK that we believe will gain from
improvement in its non-performing assets and cost base. The group has developed
a life insurance business and is well placed to benefit from growth in pensions
and savings products. In addition, we expect the bank to begin to see positive
results from a return on its capital markets activity.
VEBA AG GERMANY
This German electrical utility has successfully restructured its cost base. It
is investing excess cash flow into growth areas, such as mobile
telecommunications, which should be a valuable contributor to earnings in the
medium term. We anticipate a reassessment of VEBA as a result of its increased
emphasis on improving shareholder returns.
BANK OF IRELAND IRELAND
Bank of Ireland is Ireland's second largest retail bank and is currently
benefiting from a strong domestic economy. We expect growth in earnings to be
fueled by the bank's implementation of cost control measures. The bank is well
capitalized and adopting a more progressive dividend policy to return value to
shareholders.
REUTERS HOLDINGS PLC UK
Reuters is recognized worldwide for its financial news reporting. The company is
expected to benefit from geographical expansion and development of related
areas, such as electronic transactions for market traders. Reuters has
historically generated a strong cash flow.
ERICSSON SWEDEN
Ericsson is one of Sweden's largest exporters, specializing in various forms of
telecommunications, particularly for wireless handsets and infrastructure. Along
with Nokia and Motorola, Ericsson is regarded as among the industry leaders in
terms of existing technologies and developing new ones. As a Swedish-based
company, it is benefiting not only from the current boom in the industry, but
also from enhanced competitiveness due to the Swedish krona's devaluation and
continuing weakness.
5
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
PORTFOLIO SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
G.T. GLOBAL EUROPE GROWTH FUND - CLASS A MSCI EUROPE INDEX
<S> <C> <C>
19-Jul-85 9525 10,000
31-Jul-85 9,535 10,346
31-Aug-85 9,563 10,880
30-Sep-85 10,068 11,063
31-Oct-85 10,954 12,296
30-Nov-85 11,763 13,262
31-Dec-85 12,992 13,844
31-Jan-86 12,897 14,113
28-Feb-86 13,907 15,796
31-Mar-86 15,059 17,094
30-Apr-86 16,116 18,688
31-May-86 14,621 17,042
30-Jun-86 15,288 17,791
31-Jul-86 15,859 17,645
31-Aug-86 17,278 19,623
30-Sep-86 16,659 18,386
31-Oct-86 16,678 18,505
30-Nov-86 17,831 19,502
31-Dec-86 18,317 20,000
31-Jan-87 19,421 20,890
28-Feb-87 20,498 21,644
31-Mar-87 21,210 22,720
30-Apr-87 22,050 23,618
31-May-87 22,373 23,494
30-Jun-87 22,778 24,171
31-Jul-87 24,175 24,992
31-Aug-87 25,187 25,208
30-Sep-87 26,077 25,380
31-Oct-87 19,560 20,563
30-Nov-87 18,643 19,666
31-Dec-87 19,523 20,819
31-Jan-88 18,945 19,973
29-Feb-88 19,775 21,157
31-Mar-88 19,913 21,748
30-Apr-88 20,077 22,162
31-May-88 19,737 21,757
30-Jun-88 20,139 21,546
30-Jul-88 19,901 21,602
31-Aug-88 19,285 20,630
30-Sep-88 20,224 21,759
31-Oct-88 21,437 23,784
30-Nov-88 21,315 24,087
31-Dec-88 21,692 24,223
31-Jan-89 22,962 25,111
28-Feb-89 22,655 24,834
31-Mar-89 23,199 25,023
30-Apr-89 24,426 25,727
31-May-89 24,161 24,419
30-Jun-89 24,984 25,435
31-Jul-89 26,742 28,438
31-Aug-89 27,342 28,092
30-Sep-89 28,374 28,585
31-Oct-89 26,226 26,721
30-Nov-89 27,956 28,215
31-Dec-89 30,522 31,263
31-Jan-90 30,355 31,190
28-Feb-90 29,853 30,454
31-Mar-90 31,164 30,896
30-Apr-90 30,271 30,087
31-May-90 31,555 32,550
30-Jun-90 32,392 33,706
31-Jul-90 33,815 35,140
31-Aug-90 29,490 31,667
30-Sep-90 25,668 27,951
31-Oct-90 27,035 30,321
30-Nov-90 26,505 30,639
31-Dec-90 26,031 30,209
31-Jan-91 26,533 31,240
28-Feb-91 28,542 33,987
31-Mar-91 27,760 31,721
30-Apr-91 27,286 31,400
31-May-91 27,732 32,339
28-Jun-91 26,282 29,636
31-Jul-91 27,230 31,702
31-Aug-91 27,230 32,293
30-Sep-91 27,147 33,274
31-Oct-91 26,114 32,587
29-Nov-91 25,110 31,834
31-Dec-91 27,157 34,336
31-Jan-92 27,044 34,339
28-Feb-92 27,242 34,487
31-Mar-92 26,647 33,292
30-Apr-92 27,695 35,143
29-May-92 28,601 37,157
30-Jun-92 27,723 36,479
31-Jul-92 26,506 35,190
31-Aug-92 26,279 35,091
30-Sep-92 24,410 34,526
30-Oct-92 23,079 32,131
30-Nov-92 23,759 32,128
31-Dec-92 24,099 32,878
31-Jan-93 24,127 32,947
26-Feb-93 24,495 33,336
31-Mar-93 25,373 35,063
30-Apr-93 26,109 35,850
28-May-93 26,534 36,248
30-Jun-93 26,647 35,730
30-Jul-93 27,355 35,864
31-Aug-93 29,592 39,023
30-Sep-93 28,459 38,914
29-Oct-93 29,592 40,547
30-Nov-93 28,771 39,683
31-Dec-93 30,923 42,674
31-Jan-94 33,062 44,859
28-Feb-94 31,465 43,282
31-Mar-94 30,010 42,070
29-Apr-94 31,151 43,825
31-May-94 29,496 41,975
30-Jun-94 28,983 41,548
29-Jul-94 30,837 43,739
31-Aug-94 31,322 45,140
30-Sep-94 29,867 43,365
31-Oct-94 30,723 45,268
30-Nov-94 29,325 43,549
30-Dec-94 29,129 43,810
31-Jan-95 28,432 43,482
28-Feb-95 28,490 44,483
31-Mar-95 27,851 46,564
28-Apr-95 29,100 48,070
31-May-95 29,738 49,072
30-Jun-95 30,261 49,552
</TABLE>
THE CHART AT RIGHT SHOWS THE PERFORMANCE OF THE G.T. GLOBAL EUROPE GROWTH FUND
CLASS A SHARES SINCE THE FUND'S INCEPTION, VERSUS THE MSCI EUROPE INDEX. THIS
REPRESENTS A CUMULATIVE RETURN OF 202.61% AND AN AVERAGE ANNUAL TOTAL RETURN OF
11.77%. THE CHART ASSUMES A HYPOTHETICAL $10,000 INITIAL INVESTMENT IN THE
FUND'S CLASS A SHARES AND REFLECTS ALL FUND EXPENSES AND THE MAXIMUM 4.75% SALES
CHARGE. INVESTORS SHOULD NOTE THAT THE FUND IS A PROFESSIONALLY MANAGED MUTUAL
FUND WHILE THE INDEX IS UNMANAGED, DOES NOT INCUR EXPENSES AND IS NOT AVAILABLE
FOR INVESTMENT.
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS.
AVERAGE ANNUAL TOTAL RETURNS+
JUNE 30, 1995
<TABLE>
<CAPTION>
SHARE WITHOUT SALES CHARGE WITH SALES CHARGE++
LIFE OF LIFE OF
CLASS 1-YEAR 5-YEAR FUND 1-YEAR 5-YEAR FUND
<S> <C> <C> <C> <C> <C> <C>
CLASS A* 4.41% -1.35% 12.31% -0.55% -2.31% 11.77%
CLASS B** 3.83% N/A 7.19% -1.17% N/A 5.96%
ADV. CLASS*** N/A N/A 1.86% N/A N/A N/A
<FN>
* The Fund began operations on July 19, 1985.
** The Fund began offering Class B shares on April 1, 1993.
*** The Fund began offering Advisor Class shares on June 1, 1995. Advisor Class
shares are not sold directly to the general public and are only available
through certain employee benefit plans, financial institutions and other
entities that have entered into specific agreements with G.T. Global. Please
see the "Alternative Purchase Plan" section in the Fund's prospectus.
+ Figures assume reinvestment of all dividends and capital gains distributions
at net asset value.
++ The performance of Class A shares reflects the effects of the maximum 4.75%
sales charge. Class B share performance reflects the applicable contingent
deferred sales charge
(5.00% in the first year, decreasing to 0% after six years).
</TABLE>
THE DATA ABOVE REPRESENT PAST PERFORMANCE OF THE FUND'S SHARES, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE, SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
GEOGRAPHIC ALLOCATION OF NET ASSETS AS OF JUNE 30, 1995
<S> <C>
U.K. 34.9
France 12.1
Netherlands 10.2
Germany 9.9
Sweden 8.7
Spain 4.5
Italy 3.9
Other 3.6
Finland 3.0
US (Short-Term) 3.0
Ireland 2.6
Norway 2.4
Switzerland 1.2
100.0
SECTOR ALLOCATION OF NET ASSETS AS OF JUNE 30, 1995
Services 39.8
Finance 19.3
Consumer Non-Durables 7.8
Capital Goods 7.0
Consumer Durables 4.4
Multi-Industry/Misc 4.3
Health Care 4.3
Materials/Basic Industry 3.8
Technology 2.8
Short-Term Investments 6.6
100.0
</TABLE>
ALLOCATIONS WILL CHANGE BASED ON CURRENT MARKET CONDITIONS.
6
<PAGE>
/ /
G.T. GLOBAL
EUROPE
GROWTH FUND
/ /
FINANCIAL
STATEMENTS
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
PORTFOLIO OF INVESTMENTS
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Country Shares Value Assets *
---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (39.8%)
Elsevier N.V.............. NETH 1,450,000 $ 17,130,407 2.7
BROADCASTING &
PUBLISHING
Pearson PLC............... UK 1,805,000 17,079,755 2.7
BROADCASTING &
PUBLISHING
Compass Group PLC......... UK 2,864,544 16,946,730 2.7
RESTAURANTS
Reuters Holdings PLC...... UK 1,813,500 15,098,080 2.4
BROADCASTING &
PUBLISHING
Hornbach Holding AG
Preferred................ GER 11,193 15,058,937 2.4
RETAILERS-OTHER
Wolters Kluwer CVA........ NETH 168,745 14,891,828 2.4
BROADCASTING &
PUBLISHING
Koninklijke Ahold N.V..... NETH 398,000 14,260,168 2.3
RETAILERS-FOOD
Granada Group PLC......... UK 1,390,000 13,484,415 2.2
LEISURE & TOURISM
Carrefour Supermarche..... FR 25,780 13,207,566 2.1
RETAILERS-FOOD
Hennes & Mauritz AB "B"
Free..................... SWDN 210,000 12,306,042 2.0
RETAILERS-APPAREL
EMAP PLC.................. UK 1,593,000 11,881,632 1.9
BROADCASTING &
PUBLISHING
Great Universal Stores
PLC...................... UK 1,238,000 11,566,873 1.8
RETAILERS-OTHER
Prosegur, Compania de
Seguridad S.A. -
Registered............... SPN 436,589 10,585,615 1.7
BUSINESS & PUBLIC
SERVICES
British Sky Broadcasting
Group PLC(CHECK MARK).... UK 2,386,800 10,419,475 1.7
CABLE TELEVISION
Pinault-Printemps S.A..... FR 48,435 10,384,991 1.7
RETAILERS-OTHER
Hagemeyer N.V............. NETH 205,428 9,164,025 1.5
WHOLESALE &
INTERNATIONAL TRADE
Cortefiel S.A............. SPN 256,000 7,771,995 1.2
RETAILERS-APPAREL
Bergesen DY AS "B"........ NOR 336,300 7,643,802 1.2
TRANSPORTATION -
SHIPPING
Costa Crociere S.p.A...... ITLY 2,570,000 5,139,214 0.8
LEISURE & TOURISM
Wilhelmsen Ltd. AS "B".... NOR 160,000 3,636,659 0.6
TRANSPORTATION -
SHIPPING
Storli AS................. NOR 189,000 3,590,064 0.6
TRANSPORTATION -
SHIPPING
But S.A................... FR 15,189 3,381,944 0.5
RETAILERS-OTHER
Verenigde Nederlandse
Uitgevbedri Verigd Bezit
(VNU).................... NETH 20,000 2,395,094 0.4
BROADCASTING &
PUBLISHING
EffJohn Oy "K" Free(CHECK
MARK).................... FIN 290,000 1,936,051 0.3
TRANSPORTATION -
SHIPPING
------------
248,961,362
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-1
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Country Shares Value Assets *
---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Finance (19.3%)
S.G. Warburg Group PLC.... UK 1,626,000 $ 18,838,120 3.0
INVESTMENT MANAGEMENT
Barclays PLC.............. UK 1,650,000 17,725,429 2.8
BANKS-MONEY CENTER
National Westminster Bank
PLC...................... UK 1,893,750 16,458,880 2.6
BANKS-MONEY CENTER
Bank of Ireland........... IRE 2,800,000 16,030,533 2.6
BANKS-MONEY CENTER
Cetelem Group............. FR 75,000 11,596,743 1.9
CONSUMER FINANCE
M & G Group PLC........... UK 600,000 10,162,214 1.6
INVESTMENT MANAGEMENT
Singer & Friedlander Group
PLC...................... UK 6,250,000 9,144,402 1.5
BANKS-REGIONAL
Baloise Holding Ltd. -
Registered............... SWTZ 3,179 7,250,109 1.2
INSURANCE - MULTI-LINE
Banco Central Hispano
Americano S.A............ SPN 311,341 6,597,188 1.1
BANKS-MONEY CENTER
Invesco PLC............... UK 1,773,600 5,993,798 1.0
INVESTMENT MANAGEMENT
------------
119,797,416
------------
Consumer Non-Durables (7.8%)
Bic....................... FR 80,200 13,227,502 2.1
OTHER CONSUMER GOODS
Industrie Natuzzi S.P.A. -
ADR(INVERTED TRIANGLE)... ITLY 368,500 12,206,563 1.9
HOUSEHOLD PRODUCTS
Matthew Clark PLC......... UK 1,198,600 11,913,566 1.9
BEVERAGES - ALCOHOLIC
Luxottica Group S.P.A. -
ADR(INVERTED TRIANGLE)... ITLY 200,000 7,425,000 1.2
OTHER CONSUMER GOODS
Wella Aktiengesellschaft
Preferred................ GER 5,510 4,384,087 0.7
PERSONAL CARE/COSMETICS
------------
49,156,718
------------
Capital Goods (7.0%)
Telefonaktiebolaget LM
Ericsson "B" Free........ SWDN 756,000 15,079,234 2.4
TELECOM EQUIPMENT
Nokia AB "A"(CHECK
MARK).................... FIN 228,400 13,375,498 2.1
TELECOM EQUIPMENT
Skanska AB "B" Free....... SWDN 309,150 7,144,437 1.1
CONSTRUCTION
Coflexip ADR(INVERTED
TRIANGLE)................ FR 195,000 4,948,125 0.8
MACHINERY & ENGINEERING
Benefon OY(CHECK MARK).... FIN 96,200 3,650,597 0.6
TELECOM EQUIPMENT
------------
44,197,891
------------
Consumer Durables (4.4%)
Autoliv AB................ SWDN 244,750 13,096,697 2.1
AUTO PARTS
Moulinex(CHECK MARK)...... FR 312,100 7,547,537 1.2
APPLIANCES & HOUSEHOLD
Bertrand Faure S.A.(CHECK
MARK).................... FR 112,500 4,638,697 0.7
AUTO PARTS
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-2
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Country Shares Value Assets *
---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Durables
(Continued)
Hoganas AB "B".............. SWDN 130,000 $ 2,539,342 0.4
AUTO PARTS
------------
27,822,273
------------
Multi-Industry/Miscellaneous
(4.3%)
VEBA AG................... GER 41,250 16,216,546 2.6
CONGLOMERATE
Tomkins PLC............... UK 1,650,000 5,890,983 0.9
CONGLOMERATE
Wassall PLC............... UK 1,282,500 5,292,760 0.8
CONGLOMERATE
------------
27,400,289
------------
Health Care (4.3%)
Gehe AG:.................. GER -- -- 2.4
PHARMACEUTICALS
Common.................. -- 26,000 11,942,134 --
New..................... -- 6,500 2,985,533 --
Medeva PLC................ UK 3,000,000 11,927,481 1.9
PHARMACEUTICALS
------------
26,855,148
------------
Materials/Basic Industries
(3.8%)
Pilkington PLC............ UK 3,305,700 9,173,738 1.5
BUILDING MATERIALS &
COMPONENTS
Groupe Poliet............. FR 56,200 5,103,824 0.8
BUILDING MATERIALS &
COMPONENTS
Svedala Industri "AB" -
Free..................... SWDN 154,600 4,168,262 0.7
BUILDING MATERIALS &
COMPONENTS
Construcciones y Auxiliar
de Ferrocarriles S.A..... SPN 73,300 2,936,844 0.5
BUILDING MATERIALS &
COMPONENTS
Castorama Dubois
Investisse............... FR 12,503 2,072,449 0.3
BUILDING MATERIALS &
COMPONENTS
------------
23,455,117
------------
Technology (2.7%)
SAP AG Preferred.......... GER 9,000 11,343,580 1.8
COMPUTERS & PERIPHERALS
Getronics N.V............. NETH 115,000 5,634,926 0.9
COMPUTERS & PERIPHERALS
------------
16,978,506
------------ -----
Total Equity Investments
(cost $516,060,686)........ $584,624,720 93.4
------------ -----
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-3
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
<TABLE>
<CAPTION>
Market % of Net
Short-Term Investments Value Assets *
---------------------------- ------------ -------------
Repurchase Agreement (3.0%)
<S> <C> <C> <C> <C>
United States (3.0%)
Dated June 30, 1995 with
State Street Bank and
Trust Company due July
3, 1995, for an
effective yield of 6.10%
collateralized by
$14,165,000 United
States Treasury Bond,
9.875 due 11/15/15
(market value of
collateral is
$19,279,267, including
accrued interest). (cost
$18,899,202)............ $ 18,899,202 3.0
------------ -----
Total Investments (cost
$534,959,888)(DELTA)....... 603,523,922 96.4
Other Assets and
Liabilities................ 22,704,220 3.6
------------ -----
Net Assets.................. $626,228,142 100.0
------------ -----
------------ -----
<FN>
-----------------
* Percentages indicated are based on net assets of $626,228,142.
(INVERTED U.S. currency denominated.
TRIANGLE)
(CHECK Non-income producing security.
MARK)
(DELTA) For Federal income tax purposes, cost is $538,369,023 and
appreciation (depreciation) is as follows:
Unrealized appreciation: $ 85,744,528
Unrealized depreciation: (20,589,629)
-------------
Net unrealized appreciation: $ 65,154,899
-------------
-------------
</TABLE>
<TABLE>
<C> <S>
Abbreviation:
ADR - American Depository Receipt
</TABLE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The Fund's Portfolio of Investments at June 30, 1995, was concentrated in the
following countries:
<TABLE>
<CAPTION>
Percentage of Net Assets *
---------------------------
Short-Term
Country (Country Code/Currency Code) Equity & Other Total
-------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Finland (FIN/FIM)..................... 3.0 3.0
France (FR/FRF)....................... 12.1 12.1
Germany (GER/DEM)..................... 9.9 9.9
Ireland (IRE/IEP)..................... 2.6 2.6
Italy (ITLY/ITL)...................... 3.9 3.9
Netherlands (NETH/NLG)................ 10.2 10.2
Norway (NOR/NOK)...................... 2.4 2.4
Spain (SPN/ESP)....................... 4.5 4.5
Sweden (SWDN/SEK)..................... 8.7 8.7
Switzerland (SWTZ/CHF)................ 1.2 1.2
United Kingdom (UK/GBP)............... 34.9 34.9
United States (US/USD)................ 6.6 6.6
------ --- -----
Total................................. 93.4 6.6 100.0
------ --- -----
------ --- -----
<FN>
----------------
* Percentages indicated are based on net assets of $626,228,142.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-4
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
JUNE 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
Market Value Unrealized
(U.S. Contract Delivery Appreciation
Contracts to Sell: Dollars) Price Date (Depreciation)
-------------------------------------------------------------------------- ------------- ------------- --------- -------------
<S> <C> <C> <C> <C>
Deutsche Marks............................................................ 43,462,513 1.37248 08/03/95 $ 254,130
Deutsche Marks............................................................ 8,918,860 1.43286 08/30/95 (334,630)
French Francs............................................................. 17,270,113 5.08825 08/04/95 (791,678)
French Francs............................................................. 27,910,409 4.96615 08/16/95 (616,247)
Italian Lira.............................................................. 20,421,988 1,664.25000 08/16/95 (230,695)
Netherland Guilders....................................................... 19,219,569 1.59740 08/15/95 (626,856)
Netherland Guilders....................................................... 30,867,793 1.60070 08/15/95 (1,068,330)
Swiss Francs.............................................................. 21,458,479 1.20510 08/17/95 (1,045,235)
------------- -------------
Total Contracts to Sell (Receivable amount $185,070,183)................ 189,529,724 (4,459,541)
------------- -------------
THE VALUE OF CONTRACTS TO SELL AS A PERCENTAGE OF NET ASSETS IS 30.27%
Total Open Forward Foreign Currency Contracts, Net...................... $(4,459,541)
-------------
-------------
<FN>
----------------
See Note 1 to the financial statements.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-5
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Assets:
Investments in securities, at value (cost $534,959,888) (Note 1)................................................ $ 603,523,922
U.S. currency..................................................................................... $ 749
Foreign currencies (cost $14,398,350)............................................................. 14,599,811 14,600,560
------------
Receivable for securities sold.................................................................................. 18,738,761
Receivable for Fund shares sold................................................................................. 13,330,155
Dividends and dividend withholding tax reclaims receivable...................................................... 3,602,117
Cash held as collateral for securities loaned (Note 1).......................................................... 40,289,945
-------------
Total assets.................................................................................................... 694,085,460
-------------
Liabilities:
Payable for securities purchased................................................................................ 14,101,866
Payable for Fund shares repurchased............................................................................. 7,909,468
Payable for open forward foreign currency contracts -- net (Note 1)............................................. 4,459,541
Payable for investment management and administration fees (Note 2).............................................. 468,117
Payable for service and distribution expenses (Note 2).......................................................... 225,903
Payable for printing and postage expenses....................................................................... 183,115
Payable for custodian and fund accounting fees (Note 1)......................................................... 90,527
Payable for transfer agent fees (Note 2)........................................................................ 63,421
Payable for professional fees................................................................................... 35,557
Payable for registration fees................................................................................... 23,896
Payable for Trustees' fees and expenses (Note 2)................................................................ 5,962
Collateral for securities loaned (Note 1)....................................................................... 40,289,945
-------------
Total liabilities............................................................................................... 67,857,318
-------------
Net assets........................................................................................................ $ 626,228,142
-------------
-------------
Class A:
Net asset value and redemption price per share
($549,209,576 DIVIDED BY 52,691,745 shares outstanding)......................................................... $ 10.42
-------------
-------------
Maximum offering price per share
(100/95.25 of $10.42)*........................................................................................... $ 10.94
-------------
-------------
Class B:+
Net asset value and offering price per share
($76,341,166 DIVIDED BY 7,390,633 shares outstanding)........................................................... $ 10.33
-------------
-------------
Advisor Class (Notes 1 & 4):
Net asset value, offering price per share, and redemption price per share
($677,400 DIVIDED BY 64,960 shares outstanding)................................................................. $ 10.43
-------------
-------------
Net assets consist of:
Paid in capital (Note 4)........................................................................................ $ 769,751,624
Undistributed net investment income............................................................................. 7,271,221
Accumulated net realized loss on investments and foreign currency transactions.................................. (215,015,488)
Net unrealized depreciation on translation of assets and liabilities in foreign currencies...................... (4,343,249)
Net unrealized appreciation of investments...................................................................... 68,564,034
-------------
Total -- representing net assets applicable to capital shares outstanding....................................... $ 626,228,142
-------------
-------------
<FN>
----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-6
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
STATEMENT OF OPERATIONS
Six months ended June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income (Note 1):
Dividend income (net of foreign tax withheld of $1,520,884).......................................... $ 9,756,762
Interest income...................................................................................... 207,342
------------
Total investment income.............................................................................. 9,964,104
------------
Expenses:
Investment management and administration fees (Note 2)............................................... 3,201,498
Service and distribution expenses (Note 2):
Class A.............................................................................. $ 1,021,907
Class B.............................................................................. 384,490 1,406,397
------------
Transfer agent fees (Note 2)......................................................................... 1,227,470
Custodian and fund accounting fees (Note 1).......................................................... 383,747
Printing and postage expenses........................................................................ 146,088
Registration fees.................................................................................... 49,775
Professional fees.................................................................................... 46,600
Trustees' fees and expenses (Note 2)................................................................. 18,489
Other expenses....................................................................................... 6,257
------------
Total expenses before expense reductions............................................................. 6,486,321
Expense reductions (Notes 1 & 5)................................................................... (210,475)
------------
Total net expenses................................................................................... 6,275,846
------------
Net investment income.................................................................................. 3,688,258
------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
Net realized gain on investments....................................................... 28,822,890
Net realized loss on foreign currency transactions..................................... (37,061,602)
------------
Net realized loss during the period................................................................ (8,238,712)
Net change in unrealized depreciation on translation of assets and liabilities in
foreign currencies.................................................................... (4,751,887)
Net change in unrealized appreciation of investments................................... 33,294,369
------------
Net unrealized appreciation during the period...................................................... 28,542,482
------------
Net realized and unrealized gain on investments and foreign currencies................................. 20,303,770
------------
Net increase in net assets resulting from operations................................................... $ 23,992,028
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-7
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1995 DECEMBER 31,
(UNAUDITED) 1994
------------------- ----------------
<S> <C> <C>
Decrease in net assets
Operations:
Net investment income..................... $ 3,688,258 $ 4,829,645
Net realized gain (loss) on investments
and foreign currency transactions........ (8,238,712) 45,153,682
Net change in unrealized depreciation on
translation of assets and liabilities in
foreign currencies....................... (4,751,887) (6,292,249)
Net change in unrealized appreciation
(depreciation) of investments............ 33,294,369 (91,044,462)
------------------- ----------------
Net increase (decrease) in net assets
resulting from operations................ 23,992,028 (47,353,384)
------------------- ----------------
Class A:
Distributions to shareholders (Note 1):
From net investment income................ -- (3,125,751)
In excess of net realized gain on
investments.............................. -- (8,333,619)
Class B:
Distributions to shareholders (Note 1):
From net investment income................ -- --
In excess of net realized gain on
investments.............................. -- (1,040,571)
Capital share transactions (Note 4):
Increase from capital shares sold and
reinvested............................... 746,553,729 1,287,884,918
Decrease from capital shares
repurchased.............................. (872,232,165) (1,388,865,472)
------------------- ----------------
Decrease from capital share
transactions............................. (125,678,436) (100,980,554)
------------------- ----------------
Decrease in net assets...................... (101,686,408) (160,833,879)
Net assets:
Beginning of period....................... 727,914,550 888,748,429
------------------- ----------------
End of period............................. $ 626,228,142 $ 727,914,550
------------------- ----------------
------------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-8
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
Class A+
-------------------------------------------------------------------------
SIX MONTHS
ENDED JUNE Year ended December 31,
30, 1995 ---------------------------------------------------------
(UNAUDITED) 1994(a) 1993(a) 1992(a) 1991 1990
---------- -------- ------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of
period................................. $ 10.03 $ 10.84 $ 8.51 $ 9.59 $ 9.33 $ 10.94
---------- -------- ------- -------- ------- -------
Income from investment operations:
Net investment income (loss).......... 0.07 0.06 0.05 0.11** 0.21 0.10
Net realized and unrealized gain
(loss) on investments................ 0.32 (0.69) 2.36 (1.19) 0.19 (1.71)
---------- -------- ------- -------- ------- -------
Net increase (decrease) from
investment operations................ 0.39 (0.63) 2.41 (1.08) 0.40 (1.61)
---------- -------- ------- -------- ------- -------
Distributions to shareholders:
From net investment income............ -- (0.05) (0.06) -- (0.14) --
In excess of net investment income.... -- -- (0.02) -- -- --
In excess of net realized gain on
investments.......................... -- (0.13) -- -- -- --
---------- -------- ------- -------- ------- -------
Total distributions................. -- (0.18) (0.08) -- (0.14) --
---------- -------- ------- -------- ------- -------
Net asset value, end of period.......... $ 10.42 $ 10.03 $ 10.84 $ 8.51 $ 9.59 $ 9.33
---------- -------- ------- -------- ------- -------
---------- -------- ------- -------- ------- -------
Total investment
return (d)............................. 3.89%(c) (5.80)% 28.3% (11.3)% 4.3% (14.7)%
---------- -------- ------- -------- ------- -------
---------- -------- ------- -------- ------- -------
Ratios and supplemental data:
Net assets, end of period
(in 000's)............................. $549,210 $646,313 $854,701 $781,607 $1,211,709 $1,428,677
Ratio of net investment income to
average net assets..................... 1.18%(b) 0.61% 0.6% 1.2%** 1.7% 1.1%
Ratio of expenses to average net assets:
With expense reductions
(Notes 1 & 5)........................ 1.81%(b) 1.73% 1.9% 2.0%** 1.8% 1.9%
Without expense reductions............ 1.88%(b) 1.81% --%* --%* --%* --%*
Portfolio turnover
rate++++............................... 134%(b) 91% 67% 65% 55% 34%
<CAPTION>
Class B++ Advisor
-------------------------------------- Class+++
Year -------------
Six months ended April 1, June 1, 1995
ended June December 1993 to to June 30,
30, 1995 31, December 31, 1995
(Unaudited) 1994(a) 1993(a) (Unaudited)
---------- -------- ------------ -------------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of
period................................. $ 9.97 $10.79 $ 9.02 $10.24
---------- -------- ------------ -------------
Income from investment operations:
Net investment income (loss).......... 0.06 (0.00 ) 0.00 0.02
Net realized and unrealized gain
(loss) on investments................ 0.30 (0.69 ) 1.85 0.17
---------- -------- ------------ -------------
Net increase (decrease) from
investment operations................ 0.36 (0.69 ) 1.85 0.19
---------- -------- ------------ -------------
Distributions to shareholders:
From net investment income............ -- -- (0.06) --
In excess of net investment income.... -- -- (0.02) --
In excess of net realized gain on
investments.......................... -- (0.13 ) -- --
---------- -------- ------------ -------------
Total distributions................. -- (0.13 ) (0.08) --
---------- -------- ------------ -------------
Net asset value, end of period.......... $ 10.33 $ 9.97 $ 10.79 $10.43
---------- -------- ------------ -------------
---------- -------- ------------ -------------
Total investment
return (d)............................. 3.61%(c) (6.38 )% 20.5%(c) 1.86%(c)
---------- -------- ------------ -------------
---------- -------- ------------ -------------
Ratios and supplemental data:
Net assets, end of period
(in 000's)............................. $ 76,341 $81,602 $34,048 $ 677
Ratio of net investment income to
average net assets..................... 0.53%(b) (0.04 )% (0.1)%(b) 1.53%(b)
Ratio of expenses to average net assets:
With expense reductions
(Notes 1 & 5)........................ 2.46%(b) 2.38 % 2.6%(b) 1.46%(b)
Without expense reductions............ 2.53%(b) 2.46 % --%* 1.53%(b)
Portfolio turnover
rate++++............................... 134%(b) 91 % 67% 134%(b)
<FN>
--------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Calculation of "Ratio of expenses to average net assets" was made without
considering the effect of expense reductions, if any.
** Includes reimbursement by G.T. Capital Management, Inc. of Fund Class A
operating expenses of less than one cent per share. Without such
reimbursement, the ratio of expenses to average net assets would have been
2.1% and the ratio of net investment income to average net assets would
have been 1.2% (See Note 2).
(a) Calculated based upon weighted average shares outstanding during the
period.
(b) Annualized.
(c) Not annualized.
(d) Total investment return does not include sales charges.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-9
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Europe Growth Fund ("Fund") is a separate series of G.T. Global
Growth Series ("Company"). The Company is organized as a Massachusetts business
trust and is registered under the Investment Company Act of 1940, as amended
("1940 Act"), as a diversified, open-end management investment company. The
Company has six series of shares in operation, each series corresponding to a
distinct portfolio of investments.
The Fund offers Class A, Class B, and Advisor Class shares, each of which has
equal rights as to assets and voting privileges. Class A and Class B each has
exclusive voting rights with respect to its distribution plan. The Fund
commenced sale of Advisor Class shares on June 1, 1995. Investment income,
realized and unrealized capital gains and losses, and the common expenses of the
Fund are allocated on a pro rata basis to each class based on the relative net
assets of each class to the total net assets of the Fund. Each class of shares
differs in its respective distribution, transfer agent, registration, and
certain other class-specific fees and expenses.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded or on the principal over-the-counter market in which
such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost, adjusted for foreign exchange
translation and market fluctuation, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially changed such value,
then the fair value of those securities will be determined by consideration of
other factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when earned or incurred.
The Fund does not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the differences between the
amounts
F-10
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
of dividends, interest, and foreign withholding taxes recorded on the Fund's
books and the U.S. dollar equivalent of the amounts actually received or paid.
Net unrealized foreign exchange gains or losses arise from changes in the value
of assets and liabilities other than investments in securities at period end,
resulting from changes in exchange rates.
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value, including accrued
interest, is at least equal to the amount to be repaid to the Fund under each
agreement at its maturity. G.T. Capital is responsible for determining that the
value of these underlying securities remains at least equal to the resale price.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward Contract") is an agreement between
two parties to buy and sell a currency at a set price on a future date. The
market value of the Forward Contract fluctuates with changes in currency
exchange rates. The Forward Contract is marked-to-market daily and the change in
market value is recorded by the Fund as an unrealized gain or loss. When the
Forward Contract is closed, the Fund records a realized gain or loss equal to
the difference between the value at the time it was opened and the value at the
time it was closed. The Fund could be exposed to risk if a counterparty is
unable to meet the terms of the contract or if the value of the currency changes
unfavorably. The Fund may enter into Forward Contracts in connection with
planned purchases or sales of securities, or to hedge against adverse
fluctuations in exchange rates between currencies.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last bid
price, or, in the case of an over-the-counter option, is valued at the average
of the last bid prices obtained from brokers. If an option expires on its
stipulated expiration date or if the Fund enters into a closing purchase
transaction, a gain or loss is realized without regard to any unrealized gain or
loss on the underlying security, and the liability related to such option is
extinguished. If a written call option is exercised, a gain or loss is realized
from the sale of the underlying security and the proceeds of the sale are
increased by the premium originally received. If a written put option is
exercised, the cost of the underlying security purchased would be decreased by
the premium originally received. The Fund can write options only on a covered
basis, which, for a call, requires that the Fund hold the underlying security,
and, for a put, requires the Fund to set aside cash, U.S. government securities
or other liquid, high-grade debt securities in an amount not less than the
exercise price or otherwise provide adequate cover at all times while the put
option is outstanding. The Fund may use options to manage its exposure to the
stock market and to fluctuations in currency values or interest rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as
F-11
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
"variation margin" and are recorded by the Fund as unrealized gains or losses.
When the contract is closed, the Fund records a realized gain or loss equal to
the difference between the value of the contract at the time it was opened and
the value at the time it was closed. The potential risk to the Fund is that the
change in value of the underlying securities may not correlate to the change in
value of the contracts. The Fund may use futures contracts to manage its
exposure to the stock market and to fluctuations in currency values or interest
rates.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on a first-in,
first-out basis, unless otherwise specified. Dividends are recorded on the
ex-dividend date. Interest income is recorded on the accrual basis. Where a high
level of uncertainty exists as to its collection, income is recorded net of all
withholding tax with any rebate recorded when received. The Fund may trade
securities on other than normal settlement terms. This may increase the risk if
the other party to the transaction fails to deliver and causes the Fund to
subsequently invest at less than advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At June 30, 1995, securities with an aggregate value of approximately
$38,102,432 were on loan to brokers. The loans were secured by cash collateral
of $40,289,945, received by the Fund. For international securities, cash
collateral is received by the Fund against loaned securities in an amount at
least equal to 105% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 103%
of the market value of the loaned securities during the period of the loan. For
domestic securities, cash collateral is received by the Fund against loaned
securities in an amount at least equal to 102% of the market value of the loaned
securities at the inception of each loan. This collateral must be maintained at
not less than 100% of the market value of the loaned securities during the
period of the loan. For the period ended June 30, 1995, the Fund earned
securities lending fees of $149,150 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains. The Fund currently has a capital loss carryforward of
$195,539,627 of which $38,161,243 expires in 1999, $152,895,949 expires in 2000,
and $4,482,435 expires in 2001.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent in
investments of domestic origin. These risks of investing in foreign markets may
include foreign currency exchange rate fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.
(M) INDEXED SECURITIES
The Fund may invest in indexed securities whose value is linked either directly
or indirectly to changes in foreign currencies, interest rates, equities,
indices, or other reference instruments. Indexed securities may be more volatile
than the reference instrument itself, but any loss is limited to the amount of
the original investment.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees to
G.T. Capital at the following annualized rates of 0.975% on the first $500
million of average daily net assets of the Fund; 0.95% on the next $500 million;
0.925% on the next $500 million and 0.90% on amounts thereafter. These fees are
computed daily and paid monthly, and are subject to reduction in any year to the
extent that the Fund's expenses (exclusive of brokerage commissions, taxes,
interest, distribution-related expenses and extraordinary expenses) exceed the
most stringent
F-12
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
limits prescribed by the laws or regulations of any state in which the Fund's
shares are offered for sale, based on the average total net asset value of the
Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A, Class B, and
Advisor Class shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended June 30, 1995, G.T. Global retained $25,885
of such sales charges. Purchases of Class A shares exceeding $500,000 may be
subject to a contingent deferred sales charge ("CDSC") upon redemption, in
accordance with the Fund's current prospectus. G.T. Global collected CDSCs in
the amount of $10,973 for the period ended June 30, 1995. G.T. Global also makes
ongoing shareholder servicing and trail commission payments to dealers whose
clients hold Class A shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to CDSCs, in accordance with the Fund's current
prospectus. For the period ended June 30, 1995, G.T. Global collected CDSCs in
the amount of $239,439. In addition, G.T. Global makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class B
shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.35% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest and extraordinary
items) to the maximum annual rate of 2.25%, 2.90%, and 1.90% of the average
daily net assets of the Fund's Class A, Class B, and Advisor Class shares,
respectively. If necessary, this limitation will be effected by waivers by G.T.
Capital of investment management and administration fees, waivers by G.T. Global
of payments under the Class A Plan and/or Class B Plan and/or reimbursements by
G.T. Capital or G.T. Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the period ended June 30, 1995, purchases and sales of investment securities
by the Fund, other than U.S. government obligations and short-term investments,
aggregated $430,626,861 and $612,279,342, respectively. There were no purchases
or sales of U.S. government obligations by the Fund during the period.
F-13
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
4. CAPITAL SHARES
At June 30, 1995, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1995 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1994
-------------------------- -----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
----------- ------------- ------------ ---------------
<S> <C> <C> <C> <C>
Shares sold............................................................ 73,594,730 $ 733,806,715 109,168,643 $ 1,160,153,253
Shares issued in connection with reinvestment of distributions......... -- -- 874,425 8,526,677
----------- ------------- ------------ ---------------
73,594,730 733,806,715 110,043,068 1,168,679,930
Shares repurchased..................................................... (85,370,404) (852,380,760) (124,431,789) (1,325,037,548)
----------- ------------- ------------ ---------------
Net decrease........................................................... (11,775,674) $(118,574,045) (14,388,721) $ (156,357,618)
----------- ------------- ------------ ---------------
----------- ------------- ------------ ---------------
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1995 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1994
-------------------------- -----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
----------- ------------- ------------ ---------------
<S> <C> <C> <C> <C>
Shares sold............................................................ 1,215,135 $ 12,070,242 10,710,316 $ 118,315,558
Shares issued in connection with reinvestment of distributions......... -- -- 91,703 889,430
----------- ------------- ------------ ---------------
1,215,135 12,070,242 10,802,019 119,204,988
Shares repurchased..................................................... (2,012,337) (19,850,223) (5,769,922) (63,827,924)
----------- ------------- ------------ ---------------
Net increase (decrease)................................................ (797,202) $ (7,779,981) 5,032,097 $ 55,377,064
----------- ------------- ------------ ---------------
----------- ------------- ------------ ---------------
<CAPTION>
JUNE 1, 1995
(COMMENCEMENT OF
SALE OF SHARES)
TO JUNE 30, 1995
(UNAUDITED)
--------------------------
ADVISOR CLASS SHARES AMOUNT
----------- -------------
<S> <C> <C>
Shares sold............................................................ 65,073 $ 676,772
Shares repurchased..................................................... (113) (1,182)
----------- -------------
Net increase........................................................... 64,960 $ 675,590
----------- -------------
----------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the period ended June 30, 1995, the Fund's expenses
were reduced by $61,325 under these arrangements.
F-14
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
NOTES
--------------------------------------------------------------------------------
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
[LOGO]
G.T. GLOBAL GROUP OF FUNDS
G.T. GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY
INVESTORS' PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE
G.T. GLOBAL MUTUAL FUNDS, PLEASE CONTACT YOUR INVESTMENT COUNSELOR OR CALL
G.T. GLOBAL DIRECTLY AT 1-800-824-1580. THE PROSPECTUS CONTAINS MORE
COMPLETE INFORMATION, INCLUDING CHARGES, EXPENSES AND RISKS. INVESTORS
SHOULD READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
GROWTH FUNDS
/ / GLOBALLY DIVERSIFIED FUNDS
G.T. GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.
G.T. GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside
the U.S.
G.T. GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies
/ / GLOBAL THEME FUNDS
G.T. GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide
G.T. GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment
G.T. GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain a country's infrastructure
G.T. GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products
G.T. GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources
G.T. GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail or distribute consumer
products or services.
/ / REGIONALLY DIVERSIFIED FUNDS
G.T. GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim
G.T. GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe
G.T. LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America
/ / SINGLE COUNTRY FUNDS
G.T. GLOBAL AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.
G.T. GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market
GROWTH AND INCOME FUND
G.T. GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world
INCOME FUNDS
G.T. GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities
G.T. GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets
G.T. GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets
MONEY MARKET FUND
G.T. GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital
THIS REPORT MUST BE ACCOMPANIED OR PRECEDED BY A CURRENT PROSPECTUS.
<PAGE>
[LOGO]
G.T. GLOBAL FINANCIAL SERVICES
FIFTY CALIFORNIA STREET, 27TH FLOOR
SAN FRANCISCO, CALIFORNIA 94111
DATED MATERIAL
PLEASE EXPEDITE
