<PAGE>
G.T. GROUP
[LOGO]
TWENTY-FIVE
YEARS OF
PROVIDING
ACCESS TO
GLOBAL MARKETS
/ /
G.T. GLOBAL
JAPAN
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 Japan Growth Fund seeks long-term growth of capital by investing
in securities of issuers located in Japan.
PERFORMANCE REVIEW
The Fund's performance for the six months ending June 30, 1995, was -11.52% for
Class A shares (-15.73% taking into affect the maximum 4.75% sales charge).
Total return for Class B shares was -11.81% (-16.22% with the maximum 5%
contingent deferred sales charge). The Morgan Stanley Capital International
(MSCI) Japan Index(1) posted a total return of -8.24% during this same period.
For additional performance information, please see page 5.
While the portfolio's bond position over the period appreciated in U.S. dollar
terms by almost 10%, it was not enough to offset the weak performance of our
stock selections. In addition, the dollar's depreciation against the yen
contributed significantly to the Fund's weak performance relative to the index.
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.
MARKET REVIEW
Pockets of economic growth that had been evident late last year, such as exports
and housing, seem to have lost momentum. Prices are falling and growth of gross
domestic product is slowing. In our opinion, Japan has yet to implement the
policies necessary to promote a strong recovery. We need to see even lower
interest rates, an ample supply of funds from the central bank to boost money
supply, continued deregulation and a credible plan to deal with the overhang of
bad debt in the financial system.
These concerns, to some extent, have been reflected in the Nikkei's tumble of
26% in yen terms over the first half of the year. We believe that the weakness
in the stock market will eventually force Japanese authorities to change policy
and step in to prop up an ailing economy. Their room for maneuvering is so
limited that we expect policy changes in the next nine months.
The general decline in the prices of goods and services and the fall in the
price of assets made fixed income returns attractive, despite the low nominal
yield. As a result, bond prices rose over the first six months of the year.
------------------
(1) The MSCI Japan Index is an arithmetic average, weighted by market value, of
the performance of 318 securities listed on Japanese stock exchanges. It
includes the effect of reinvested dividends and is measured in U.S. dollars.
1
<PAGE>
PORTFOLIO STRATEGY
In a deflationary environment, it is difficult for companies in general to
expand their sales and profits. Throughout the period, we have maintained a
selective investment strategy, focusing on cash-rich domestic companies whose
niche businesses were growing through market share gains and innovative
management strategies. In addition, we hold a number of export-oriented
companies whose profits have increased in line with the growth in overseas
economies. Recently, however, we have reduced our positions in these companies
as our expectations of growth in the U.S. and Europe have fallen. Over the
second quarter of the year, we increased our holdings in stocks and reduced our
bond holdings, in reaction to lower stock prices.
OUTLOOK
In line with our belief that government policy will soon change, we are looking
to increase our stock weighting. The valuations of some stocks have improved as
prices have fallen, and we have identified a growing list of companies with
clear business strategies that we currently plan to acquire when prices weaken.
In our opinion, the possibility of decisive government action is higher now than
at any time over the past three years. We will continue to watch the markets
closely and will adopt a more fully invested position when we believe the timing
is right.
We also intend to continue to hedge against a strong U.S. dollar. This is a
position we have held for some time to mitigate any fall in the value of the
portfolio caused by a weaker yen. We expect the yen to depreciate once the
government begins taking action necessary to stimulate the economy.
CHRISTIAN WIGNALL MICHAEL LINDSELL
CHIEF INVESTMENT OFFICER PORTFOLIO MANAGER
GLOBAL EQUITIES TOKYO
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 JAPAN GROWTH FUND
2
<PAGE>
KEY PORTFOLIO HOLDINGS*
DAINI DENDEN INC. (DDI)
As the second largest cellular telephone operator in Japan after NTT, the former
government monopoly, DDI now has countrywide coverage in the recently
deregulated cellular market. Prices of services have fallen and demand has
picked up sharply. We anticipate strong growth in sales and profits from this
relatively underdeveloped business in Japan. The company also has a
long-distance telephone operation that has been able to expand market share in a
very competitive market.
TAKEDA CHEMICAL INDUSTRIES
Takeda is Japan's largest pharmaceutical company. In the late 1980s, the company
changed its strategy from dependence on selling foreign companies' products to
developing its own. Research and development as a percentage of sales has risen
significantly since then, and the company now has a profile of high-margin, in-
house developed drugs from which it expects to increase sales and margins in the
future.
SEVEN-ELEVEN JAPAN LTD
ITO-YOKADO CO., LTD
SOUTHLAND CORP.
These three companies are related to each other. Ito-Yokado is the holding
company that operates a chain of supermarkets in Japan. Seven-Eleven is a
subsidiary of Ito-Yokado, which owns and manages the largest convenience store
operation in Japan with over 5,500 franchises and wholly-owned stores. Seven-
Eleven has the highest margins within the industry and has continued to generate
high returns on equity despite the poor overall economic environment. Southland,
owned by both Seven-Eleven Japan and Ito-Yokado, is the largest convenience
store operator in the U.S., selling under the Seven-Eleven name. The three
companies combined may well have the largest buying power worldwide of any
retailing group.
AUTOBACS SEVEN CO., LTD.
Autobacs Seven retails car accessories at over 250 wholly owned or franchised
outlets in Japan. With few organized competitors in the industry, Autobacs is
able to offer products at reasonable prices using the economies of scale of its
fast-
------------------
* There can be no assurance the Fund will continue to hold these or any other
securities mentioned in this report.
3
<PAGE>
growing business. Margins continue to rise as a result of strong cost control,
good merchandising and sound management of inventory.
MATSUSHITA-KOTOBUKI ELECTRONICS LTD.
The company manufactures components for personal computers and videotape
recorders, specializing in the production of hard disk drives and CD ROM drives
for U.S. computer manufacturers. It has moved production of low margin products
(videotape recorders) offshore to Asia, thereby improving margins. The company
has also benefited from the strong demand for personal computers in the U.S.
over the last two years.
BUNKYODO CO., LTD.
Bunkyodo operates a chain of bookstores and is the largest and fastest-growing
company in a fragmented market. Management has adopted an aggressive store-
opening plan that is driving sales growth. As market presence increases, we
expect negotiating power with wholesalers and manufacturers, and eventually
improved profit margins to follow. We anticipate that the combination of growth
in the number of stores and growth in margins will result in an increase in
sales and profits by at least 30% over the next two years.
MURATA MANUFACTURING CO., LTD.
Murata manufactures a large range of electric components for the semiconductor,
industrial electronics and telecommunication industries. We consider Murata's
technology preeminent, its components highly sophisticated and its margins
greater than its competitors'. The company has production facilities in Asia and
Japan and has benefited from the strong demand for components in the
semiconductor and telecommunication industries.
NICHEI CO., LTD.
Nichei is a financial services company providing short-term financing to small
businesses in Japan that do not have property to use as collateral for bank
loans. Loans are restricted in size and backed by third-party guarantees. Most
loans are repaid in four months, making cash flow the most important
consideration to monitor. Margins are high, and may fall, but we expect this to
be offset by the company's growth potential. Bad loans represent a minimal
proportion of the total, as credit checks are stringent. Profit growth has
mirrored sales growth with a low valuation of 20 times earnings.
4
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
PORTFOLIO SUMMARY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
G.T. GLOBAL JAPAN GROWTH FUND - CLASS A MSCI JAPAN INDEX
<S> <C> <C>
19-Jul-85 9525 10,000
31-Jul-85 9,535 10,020
31-Aug-85 9,487 10,261
30-Sep-85 10,458 11,351
31-Oct-85 10,859 11,711
30-Nov-85 11,411 11,887
31-Dec-85 11,811 12,591
31-Jan-86 12,297 12,941
28-Feb-86 13,440 14,501
31-Mar-86 15,308 17,614
30-Apr-86 16,137 18,286
31-May-86 16,252 18,167
30-Jun-86 17,168 20,015
31-Jul-86 19,405 22,663
31-Aug-86 20,764 24,726
30-Sep-86 20,041 25,345
31-Oct-86 16,301 21,966
30-Nov-86 17,853 23,424
31-Dec-86 19,048 25,147
31-Jan-87 19,395 29,194
28-Feb-87 19,414 29,719
31-Mar-87 19,864 32,978
30-Apr-87 21,664 38,168
31-May-87 23,064 38,101
30-Jun-87 23,882 35,282
31-Jul-87 24,997 34,049
31-Aug-87 28,033 38,294
30-Sep-87 29,945 36,943
31-Oct-87 24,741 34,174
30-Nov-87 26,022 35,542
31-Dec-87 28,974 36,006
31-Jan-88 29,772 37,948
29-Feb-88 32,989 40,817
31-Mar-88 34,710 43,896
30-Apr-88 37,564 44,356
31-May-88 36,319 42,356
30-Jun-88 35,200 40,762
30-Jul-88 35,032 42,635
31-Aug-88 33,801 39,417
30-Sep-88 34,024 41,118
31-Oct-88 32,675 44,553
30-Nov-88 35,569 48,516
31-Dec-88 35,313 48,798
31-Jan-89 37,785 48,946
28-Feb-89 39,656 49,896
31-Mar-89 40,759 48,157
30-Apr-89 42,129 48,082
31-May-89 42,162 45,363
30-Jun-89 40,492 43,334
31-Jul-89 46,004 49,086
31-Aug-89 46,539 45,702
30-Sep-89 50,681 48,619
31-Oct-89 49,144 47,348
30-Nov-89 51,416 49,767
31-Dec-89 56,759 49,680
31-Jan-90 57,971 46,695
28-Feb-90 54,785 41,871
31-Mar-90 48,967 33,755
30-Apr-90 47,686 34,185
31-May-90 54,854 39,081
30-Jun-90 55,443 37,260
31-Jul-90 57,001 36,762
31-Aug-90 49,470 33,189
30-Sep-90 39,569 27,761
31-Oct-90 46,581 34,496
30-Nov-90 41,824 30,355
31-Dec-90 40,450 31,786
31-Jan-91 40,309 32,694
28-Feb-91 45,136 36,822
31-Mar-91 44,854 34,536
30-Apr-91 44,995 35,401
31-May-91 45,383 35,242
28-Jun-91 45,066 32,710
31-Jul-91 45,383 33,726
31-Aug-91 41,824 31,867
30-Sep-91 44,854 34,655
31-Oct-91 45,031 36,156
29-Nov-91 39,287 33,607
31-Dec-91 39,322 34,675
31-Jan-92 37,525 33,073
28-Feb-92 36,046 30,316
31-Mar-92 32,698 27,034
30-Apr-92 31,641 25,374
29-May-92 33,156 27,408
30-Jun-92 32,099 24,907
31-Jul-92 30,760 24,626
31-Aug-92 32,275 28,994
30-Sep-92 31,747 28,304
30-Oct-92 30,478 26,994
30-Nov-92 30,619 27,696
31-Dec-92 30,864 27,291
31-Jan-93 30,757 27,207
26-Feb-93 31,467 28,390
31-Mar-93 34,589 32,389
30-Apr-93 38,456 38,151
28-May-93 39,520 39,207
30-Jun-93 38,704 38,669
30-Jul-93 40,797 41,123
31-Aug-93 41,897 42,025
30-Sep-93 42,323 40,033
29-Oct-93 42,181 39,856
30-Nov-93 39,555 33,246
31-Dec-93 41,187 34,306
31-Jan-94 44,132 39,849
28-Feb-94 46,473 41,676
31-Mar-94 45,693 39,899
29-Apr-94 46,296 41,605
31-May-94 46,438 42,520
30-Jun-94 48,779 44,623
29-Jul-94 47,396 43,025
31-Aug-94 46,863 43,323
30-Sep-94 45,232 42,259
31-Oct-94 45,338 43,423
30-Nov-94 43,068 41,243
30-Dec-94 43,891 41,722
31-Jan-95 40,278 39,294
28-Feb-95 38,689 37,401
31-Mar-95 39,700 40,849
28-Apr-95 39,809 42,848
31-May-95 37,930 40,197
30-Jun-95 38,833 38,282
</TABLE>
THE CHART AT LEFT SHOWS THE PERFORMANCE OF THE G.T. GLOBAL JAPAN GROWTH FUND
CLASS A SHARES SINCE THE FUND'S INCEPTION VERSUS THE MSCI JAPAN INDEX. THIS
REPRESENTS A CUMULATIVE RETURN OF 288.33% AND AN AVERAGE ANNUAL TOTAL RETURN OF
14.60%. 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* -20.39% -6.87% 15.16% -24.17% -7.78% 14.60%
CLASS B** -20.91% N/A 4.17% -24.79% N/A 2.89%
ADV. CLASS*** N/A N/A 2.38% 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% for 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>
SECTOR ALLOCATION OF NET ASSETS AS OF JUNE 30, 1995
<S> <C>
SERVICES 40.1%
TECHNOLOGY 14.3%
HEALTH CARE 7.4%
CAPITAL GOODS 4.7%
FINANCE 2.7%
MATERIALS/BASIC INDUSTRIES 2.2%
CONSUMER DURABLES 1.1%
FIXED INCOME & OPTIONS 16.2%
SHORT-TERM & OTHER 11.3%
</TABLE>
ALLOCATIONS WILL CHANGE BASED ON CURRENT MARKET CONDITIONS.
5
<PAGE>
/ /
G.T. GLOBAL
JAPAN
GROWTH FUND
/ /
FINANCIAL
STATEMENTS
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
PORTFOLIO OF INVESTMENTS
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Shares Value Assets *
------------------------------------- ----------- ------------ -------------
<S> <C> <C> <C>
Services (40.1%)
DDI Corp........................... 690 $ 5,536,937 5.3
WIRELESS COMMUNICATIONS
Seven-Eleven Japan Ltd............. 69,000 4,942,530 4.8
RETAILERS-OTHER
Autobacs Seven Co., Ltd............ 50,000 4,867,831 4.7
RETAILERS-OTHER
Ito-Yokado Co., Ltd................ 90,000 4,747,463 4.6
RETAILERS-OTHER
Southland Corp. (CHECK MARK)
(INVERTED TRIANGLE) (2DIAMONDS)... 1,145,000 3,935,938 3.8
RETAILERS-OTHER
Bunkyodo Co., Ltd.................. 93,000 3,040,005 2.9
RETAILERS-OTHER
Fast Retailing Co., Ltd............ 31,000 2,644,914 2.5
RETAILERS-APPAREL
Yoshinoya D&C Co., Ltd............. 190 2,556,054 2.5
RESTAURANTS
Aoyama Trading Co., Ltd............ 150,000 2,513,571 2.4
RETAILERS-APPAREL
Kentucky Fried Chicken Japan....... 102,000 1,649,044 1.6
RESTAURANTS
Nissha Printing Co................. 116,000 1,587,916 1.5
BROADCASTING & PUBLISHING
Ten Allied Co...................... 80,000 1,350,012 1.3
RESTAURANTS
Nitori Co.......................... 42,000 1,135,001 1.1
RETAILERS-OTHER
Xebio Co., Ltd..................... 32,000 1,095,614 1.1
RETAILERS-APPAREL
------------
41,602,830
------------
Technology (14.3%)
Matsushita-Kotobuki Electronics
Ltd............................... 210,000 4,113,760 4.0
COMPUTERS & PERIPHERALS
Kyushu-Matsushita Electric Co.,
Ltd............................... 160,000 2,775,549 2.7
COMPUTERS & PERIPHERALS
Koei Co., Ltd...................... 99,900 2,499,268 2.4
SOFTWARE
Hosiden Electronics................ 235,000 2,468,138 2.4
COMPUTERS & PERIPHERALS
Riso Kagaku........................ 14,500 1,011,270 1.0
COMPUTERS & PERIPHERALS
Innotech Corp...................... 29,800 984,659 0.9
SEMICONDUCTORS
Nippon Densan...................... 37,900 895,944 0.9
COMPUTERS & PERIPHERALS
------------
14,748,588
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-1
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Shares Value Assets *
------------------------------------- ----------- ------------ -------------
<S> <C> <C> <C>
Health Care (7.4%)
Takeda Chemical Industries......... 380,000 $ 5,022,422 4.8
PHARMACEUTICALS
Olympus Optical Co., Ltd........... 240,000 1,972,668 1.9
MEDICAL TECHNOLOGY & SUPPLIES
Fujisawa Pharmaceuticals........... 72,000 754,496 0.7
PHARMACEUTICALS
------------
7,749,586
------------
Capital Goods (4.7%)
Murata Manufacturing Co., Ltd...... 76,000 2,878,924 2.8
ELECTRICAL PLANT/EQUIPMENT
Enomoto Co., Ltd................... 80,000 1,651,390 1.6
INDUSTRIAL COMPONENTS
Shima Seiki Manufacturing Ltd...... 7,700 362,890 0.3
MACHINE TOOLS
Japan Foundation Engineering....... 900 17,524 --
CONSTRUCTION
NEC System Integration &
Construction...................... 600 9,134 --
CONSTRUCTION
------------
4,919,862
------------
Finance (2.7%)
Nichiei Co., Ltd................... 45,000 2,777,319 2.7
------------
INVESTMENT MANAGEMENT
Materials/Basic Industries (2.2%)
Toyo Exterior...................... 100,000 2,301,156 2.2
------------
BUILDING MATERIALS & COMPONENTS
Consumer Durables (1.1%)
NGK Spark Plug Co., Ltd............ 100,000 1,109,275 1.1
AUTO PARTS
------------ -----
Total Equity Investments (cost
$83,667,166)........................ 75,208,616 72.5
------------ -----
------------ -----
<CAPTION>
Principal
Amount in Market % of Net
Fixed Income Investments JPY Value Assets *
------------------------------------- ----------- ------------ -------------
<S> <C> <C> <C>
Government & Government Agency
Obligations (12.8%)
Austria (3.7%)
Republic of Austria, 4.5% due
9/28/05......................... 290,000,000 3,873,112 3.7
Finland (3.1%)
Republic of Finland, 6% due
1/29/02......................... 225,000,000 3,176,260 3.1
Japan (6.0%)
Japanese Government Bond:
5% due 3/20/15................. 220,000,000 3,169,283 3.1
4.7% due 3/20/14............... 220,000,000 3,045,705 2.9
------------
Total Government & Government Agency
Obligations (cost $10,761,229)...... 13,264,360
------------
Supranational Bond (2.7%)
International Bank of
Reconstruction & Development,
4.75% due 12/20/04 (cost
$2,500,085)....................... 205,000,000 2,796,554 2.7
------------ -----
Total Fixed Income Investments (cost
$13,261,314)........................ 16,060,914 15.5
------------ -----
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-2
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
<TABLE>
<CAPTION>
Underlying
Nominal
Amount in Market % of Net
Options (0.7%) JPY Value Assets *
------------------------------------- ----------- ------------ -------------
<S> <C> <C> <C>
Simex Nikkei Put Option, strike
price JPY15,000, expires
9/5/95(CHECK MARK)................. 600,000,000 $ 490,913 0.5
INDEX OPTIONS
Simex Nikkei Put Option, strike
price JPY14,500, expires
9/12/95(CHECK MARK)............... 290,000,000 193,533 0.2
INDEX OPTIONS
------------ -----
Total Options (cost $610,798)........ 684,446 0.7
------------ -----
------------ -----
<CAPTION>
Market % of Net
Short-Term Investments Value Assets *
------------------------------------- ------------ -------------
<S> <C> <C> <C>
Repurchase Agreement (6.7%)
United States (6.7%)
Dated June 30, 1995 with State
Street Bank and Trust Company,
due July 3, 1995, for an
effective yield of 6.10%
collateralized by $5,190,000
United States Treasury Bond,
9.875% due 11/15/15 (market
value of collateral is
$7,063,848, including accrued
interest).
(cost $6,922,173)............... 6,922,173 6.7
------------ -----
Total Investments (cost
$104,461,451)(DELTA)................ 98,876,149 95.4
Other Assets and Liabilities......... 4,823,672 4.6
------------ -----
Net Assets........................... $103,699,821 100.0
------------ -----
------------ -----
<FN>
-----------------
* Percentages indicated are based on net assets of $103,699,821.
(2DIAMONDS) This is a U.S. security of which approximately 62.5% of its
outstanding stock is owned by Ito-Yokado Co., Ltd.
(INVERTED U.S. currency denominated.
TRIANGLE)
(CHECK Non-income producing security.
MARK)
(DELTA) For Federal income tax purposes, cost is $104,657,851 and
appreciation (depreciation) is as follows:
Unrealized appreciation: $ 7,253,258
Unrealized depreciation: (13,034,960)
-------------
Net unrealized depreciation: $ (5,781,702)
-------------
-------------
</TABLE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
JUNE 30, 1995 (UNAUDITED)
<TABLE>
<CAPTION>
Market Value
(U.S. Contract Delivery Unrealized
Contracts to Buy: Dollars) Price Date Depreciation
------------------------------------------------------------------------------- ------------- ---------- --------- ------------
<S> <C> <C> <C> <C>
Japanese Yen................................................................... 1,033,049 83.60000 08/15/95 $ (7,620)
Japanese Yen................................................................... 5,022,757 83.83000 08/15/95 (23,170)
------------- ------------
Total Contracts to Buy (Payable amount $6,086,596)........................... 6,055,806 (30,790)
------------- ------------
THE VALUE OF CONTRACTS TO BUY AS A PERCENTAGE OF NET ASSETS IS 5.84%
<CAPTION>
Contracts to Sell:
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Japanese Yen................................................................... 21,135,951 84.25000 08/15/95 (8,354)
Japanese Yen................................................................... 40,372,040 84.64000 08/15/95 (201,908)
Japanese Yen................................................................... 21,806,690 84.00000 09/12/95 (20,976)
------------- ------------
Total Contracts to Sell (Receivable amount $83,083,443)...................... 83,314,681 (231,238)
------------- ------------
THE VALUE OF CONTRACTS TO SELL AS A PERCENTAGE OF NET ASSETS IS 80.34%
Total Open Forward Foreign Currency Contracts, Net........................... $ (262,028)
------------
------------
<FN>
----------------
See Note 1 to the financial statements.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-3
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C> <C>
Investments in securities, at value (cost $104,461,451) (Note 1).................................... $ 98,876,149
U.S. currency........................................................................... $ 637
Foreign currencies (cost $1,095,035).................................................... 1,089,561 1,090,198
----------
Receivable for securities sold...................................................................... 5,323,705
Receivable for Fund shares sold..................................................................... 3,437,983
Receivable for initial margin (Note 1).............................................................. 470,360
Interest and interest withholding tax reclaims receivable........................................... 258,576
Dividends and dividend withholding tax reclaims receivable.......................................... 217,143
Prepaid assets...................................................................................... 8,916
Cash held as collateral for securities loaned (Note 1).............................................. 7,544,800
-------------
Total assets........................................................................................ 117,227,830
-------------
Liabilities:
Payable for securities purchased.................................................................... 4,987,374
Payable for Fund shares repurchased................................................................. 512,761
Payable for open forward foreign currency contracts -- net (Note 1)................................. 262,028
Payable for investment management and administration fees (Note 2).................................. 76,406
Payable for service and distribution expenses (Note 2).............................................. 38,677
Payable for transfer agent fees (Note 2)............................................................ 36,290
Payable for printing and postage expenses........................................................... 14,248
Payable for custodian and fund accounting fees (Note 1)............................................. 12,695
Payable for professional fees....................................................................... 9,578
Payable for registration fees....................................................................... 7,054
Payable for Trustees' fees and expenses (Note 2).................................................... 4,288
Accrued expenses.................................................................................... 21,810
Collateral for securities loaned (Note 1)........................................................... 7,544,800
-------------
Total liabilities................................................................................... 13,528,009
-------------
Net assets............................................................................................ $ 103,699,821
-------------
-------------
Class A:
Net asset value and redemption price per share
($80,655,796 DIVIDED BY 7,505,342 shares outstanding)............................................... $ 10.75
-------------
-------------
Maximum offering price per share
(100/95.25 of $10.75)*............................................................................... $ 11.29
-------------
-------------
Class B:+
Net asset value and offering price per share
($22,610,779 DIVIDED BY 2,134,099 shares outstanding)............................................... $ 10.60
-------------
-------------
Advisor Class (Notes 1 & 4):
Net asset value, offering price per share, and redemption price per share
($433,246 DIVIDED BY 40,300 shares outstanding)..................................................... $ 10.75
-------------
-------------
Net assets consist of:
Paid in capital (Note 4)............................................................................ $ 105,961,521
Accumulated net investment loss..................................................................... (115,937)
Accumulated net realized gain on investments and foreign currency transactions...................... 3,676,404
Net unrealized depreciation on translation of assets and liabilities in foreign currencies.......... (236,865)
Net unrealized depreciation of investments.......................................................... (5,585,302)
-------------
Total -- representing net assets applicable to capital shares outstanding........................... $ 103,699,821
-------------
-------------
<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-4
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENT OF OPERATIONS
Six months ended June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income (Note 1):
Interest income...................................................................................... $ 730,838
Dividend income (net of foreign tax withheld of $44,680)............................................. 252,613
------------
Total investment income.............................................................................. 983,451
------------
Expenses:
Investment management and administration fees (Note 2)............................................... 509,842
Service and distribution expenses (Note 2):............................................
Class A.............................................................................. $ 143,752
Class B.............................................................................. 112,018 255,770
------------
Transfer agent fees (Note 2)......................................................................... 233,370
Custodian and fund accounting fees (Note 1).......................................................... 59,909
Printing and postage expenses........................................................................ 49,745
Professional fees.................................................................................... 38,270
Registration fees.................................................................................... 36,200
Trustees' fees and expenses (Note 2)................................................................. 7,240
Other expenses....................................................................................... 1,366
------------
Total expenses before expense reductions............................................................. 1,191,712
Expense reductions (Notes 1 & 5)................................................................... (92,324)
------------
Total net expenses................................................................................... 1,099,388
------------
Net investment loss.................................................................................... (115,937)
------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
Net realized gain on investments....................................................... 12,200,623
Net realized loss on foreign currency transactions..................................... (8,682,090)
------------
Net realized gain during the period................................................................ 3,518,533
Net change in unrealized depreciation on translation of assets and liabilities in
foreign currencies.................................................................... (1,896,477)
Net change in unrealized depreciation of investments................................... (15,250,858)
------------
Net unrealized depreciation during the period...................................................... (17,147,335)
------------
Net realized and unrealized loss on investments and foreign currencies................................. (13,628,802)
------------
Net decrease in net assets resulting from operations................................................... $(13,744,739)
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-5
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1995 DECEMBER 31,
(UNAUDITED) 1994
---------------- ----------------
<S> <C> <C>
Increase (Decrease) in net assets
Operations:
Net investment loss....................... $ (115,937) $ (577,388)
Net realized gain on investments and
foreign currency transactions............ 3,518,533 8,729,650
Net change in unrealized depreciation on
translation of assets and liabilities in
foreign currencies....................... (1,896,477) (528,496)
Net change in unrealized depreciation of
investments.............................. (15,250,858) (3,251,782)
---------------- ----------------
Net increase (decrease) in net assets
resulting from operations................ (13,744,739) 4,371,984
---------------- ----------------
Class A:
Distributions to shareholders (Note 1):
From net realized gain on investments..... -- (1,687,150)
Class B:
Distributions to shareholders (Note 1):
From net realized gain on investments..... -- (462,102)
Capital share transactions (Note 4):
Increase from capital shares sold and
reinvested............................... 218,802,920 422,096,027
Decrease from capital shares
repurchased.............................. (226,779,819) (391,082,829)
---------------- ----------------
Net increase (decrease) from capital share
transactions............................. (7,976,899) 31,013,198
---------------- ----------------
Total increase (decrease) in net assets..... (21,721,638) 33,235,930
Net assets:
Beginning of period....................... 125,421,459 92,185,529
---------------- ----------------
End of period............................. $ 103,699,821 $ 125,421,459
---------------- ----------------
---------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-6
<PAGE>
G.T. GLOBAL JAPAN 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 1993 1992(A) 1991 1990
---------- -------- ------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.15 $ 11.61 $ 8.70 $ 11.16 $ 11.48 $ 16.39
---------- -------- ------- -------- ------- -------
Income from investment operations:
Net investment income (loss).......... (0.01) (0.04) (0.14) (0.00)* (0.09) (0.05)DDAG
Net realized and unrealized gain
(loss) on investments................ (1.39) 0.79 3.05 (2.40) (0.23) (4.60)
---------- -------- ------- -------- ------- -------
Net increase (decrease) from
investment operations................ (1.40) 0.75 2.91 (2.40) (0.32) (4.65)
---------- -------- ------- -------- ------- -------
Distributions to shareholders:
From net realized gain on
investments.......................... -- (0.21) -- (0.06) -- (0.26)
---------- -------- ------- -------- ------- -------
Net asset value, end of period.......... $ 10.75 $ 12.15 $ 11.61 $ 8.70 $ 11.16 $ 11.48
---------- -------- ------- -------- ------- -------
---------- -------- ------- -------- ------- -------
Total investment return (d)............. (11.52)%(b) 6.56% 33.5% (21.5)% (2.8)% (28.7)%
---------- -------- ------- -------- ------- -------
---------- -------- ------- -------- ------- -------
Ratios and supplemental data:
Net assets, end of period
(in 000's)............................. $ 80,656 $ 98,066 $88,487 $ 93,865 $61,519 $51,693
Ratio of net investment income (loss) to
average net assets..................... (0.08)%(c) (0.32)% (0.3)% (0.0)%* (1.5)% (1.2)%DDAG
Ratio of expenses to average net assets:
With expense reductions
(Notes 1 & 5)........................ 1.95%(c) 1.91% 2.1% 2.2%* 2.2% 2.2%DDAG
Without expense reductions............ 2.13%(c) 2.03% --%** --%** --%** --%**
Portfolio turnover rate++++............. 60%(c) 49% 104% 115% 251% 138%
<CAPTION>
ADVISOR
CLASS+++
CLASS B++ -----------
------------------------------------- JUNE 1,
SIX MONTHS YEAR APRIL 1, 1995 TO
ENDED JUNE ENDED 1993 TO JUNE 30,
30, 1995 DECEMBER DECEMBER 1995
(UNAUDITED) 31, 1994 31, 1993 (UNAUDITED)
---------- -------- -------- -----------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.02 $11.57 $ 9.85 $10.50
---------- -------- -------- -----------
Income from investment operations:
Net investment income (loss).......... (0.04) (0.13 ) (0.18 ) 0.01
Net realized and unrealized gain
(loss) on investments................ (1.38) 0.79 1.90 0.24
---------- -------- -------- -----------
Net increase (decrease) from
investment operations................ (1.42) 0.66 1.72 0.25
---------- -------- -------- -----------
Distributions to shareholders:
From net realized gain on
investments.......................... -- (0.21 ) -- --
---------- -------- -------- -----------
Net asset value, end of period.......... $ 10.60 $12.02 $11.57 $10.75
---------- -------- -------- -----------
---------- -------- -------- -----------
Total investment return (d)............. (11.81)%(b) 5.81 % 17.5 %(b) 2.38%(b)
---------- -------- -------- -----------
---------- -------- -------- -----------
Ratios and supplemental data:
Net assets, end of period
(in 000's)............................. $ 22,611 $27,355 $3,699 $ 433
Ratio of net investment income (loss) to
average net assets..................... (0.73)%(c) (0.97 )% (0.9 )%(c) 0.27%(c)
Ratio of expenses to average net assets:
With expense reductions
(Notes 1 & 5)........................ 2.60%(c) 2.56 % 2.7 %(c) 1.60%(c)
Without expense reductions............ 2.78%(c) 2.68 % -- %** 1.78%(c)
Portfolio turnover rate++++............. 60%(c) 49 % 104 % 60%(c)
<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.
* Includes reimbursement by G.T. Capital Management, Inc. of operating
expenses of $0.01. Without such reimbursement, the ratio of expenses to
average net assets would have been 2.3% and the ratio of net investment
loss to average net assets would have been (0.1)% (See Note 2).
** Calculation of "Ratios of expenses to average net assets" was made without
considering the effect of expense reductions, if any.
DDAG Includes reimbursement by G.T. Capital Management, Inc. of operating
expenses of $0.01. Without such reimbursement, the ratio of expenses to
average net assets would have been 2.4% and the ratio of net investment
loss to average net assets would have been (1.35)% (See Note 2).
(a) These selected per share data were calculated based upon weighted average
shares outstanding during the year.
(b) Not annualized.
(c) Annualized.
(d) Total investment return does not include sales charges.
</TABLE>
F-7
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
June 30, 1995 (Unaudited)
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Japan 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-8
<PAGE>
G.T. GLOBAL JAPAN 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 and 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 a 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 and bond markets 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 securitiy 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-9
<PAGE>
G.T. GLOBAL JAPAN 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 and bond markets 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 advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At June 30, 1995, stocks with an aggregate value of approximately $7,102,269
were on loan to brokers. The loans were secured by cash collateral of
$7,544,800, 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 each loan. For
the period ended June 30, 1995, the Fund received securities lending fees of
$49,909 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, and unrealized appreciation of securities held, or for excise tax on
income and capital gains.
(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: 0.975% on the first $500 million
of average daily net assets of the Fund; 0.95% on the next $500 million; 0.925%
of 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 limits prescribed by the laws or regulations of any state in
which the Fund's shares are offered for sale, based on the average net asset
value of the Fund.
F-10
<PAGE>
G.T. GLOBAL JAPAN GROWTH 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 $27,365
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 $23,844 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. During the
period ended June 30, 1995, G.T. Global collected CDSCs in the amount of
$96,576. 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 its 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 its
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 level 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 $30,466,388 and $54,525,308, respectively. There were no purchases or
sales of U.S. government obligations by the Fund during the period.
F-11
<PAGE>
G.T. GLOBAL JAPAN 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
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold............................................................... 18,206,713 $ 199,379,621 26,403,403 $ 337,405,704
Shares issued in connection with reinvestment of distributions............ -- -- 119,477 1,396,969
----------- ------------- ----------- -------------
18,206,713 199,379,621 26,522,880 338,802,673
Shares repurchased........................................................ (18,774,088) (206,061,387) (26,071,333) (332,875,892)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... (567,375) $ (6,681,766) 451,547 $ 5,926,781
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1995 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1994
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS B
Shares sold............................................................... 1,771,515 $ 18,992,733 6,416,496 $ 82,933,091
Shares issued in connection with reinvestment of distributions............ -- -- 31,084 360,263
----------- ------------- ----------- -------------
1,771,515 18,992,733 6,447,580 83,293,354
Shares repurchased........................................................ (1,912,722) (20,715,967) (4,491,860) (58,206,937)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... (141,207) $ (1,723,234) 1,955,720 $ 25,086,417
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
<CAPTION>
JUNE 1, 1995
(COMMENCEMENT OF
SALE OF SHARES)
TO JUNE 30, 1995
(UNAUDITED)
--------------------------
ADVISOR CLASS SHARES AMOUNT
----------- -------------
<S> <C> <C>
Shares sold............................................................... 40,529 $ 430,566
Shares repurchased........................................................ (229) (2,465)
----------- -------------
Net increase.............................................................. 40,300 $ 428,101
----------- -------------
----------- -------------
</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 $42,415 under these arrangements.
F-12
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
NOTES
--------------------------------------------------------------------------------
<PAGE>
G.T. GLOBAL JAPAN 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
