<PAGE>
CHANCELLOR LGT
ASSET MANAGEMENT
OVER 25 YEARS
OF INVESTING
WORLDWIDE
GT GLOBAL
NEW PACIFIC
GROWTH FUND
ANNUAL REPORT
DECEMBER 31, 1996
[LOGO]
<PAGE>
TABLE
OF CONTENTS
<TABLE>
<S> <C>
Message from the
President............ 1
Report from the Fund
Managers and Key
Portfolio Holdings... 2
Report of Independent
Accountants.......... F1
Financial
Statements........... F2
Portfolio holdings'
and views of the
Funds' managers
described in this
annual report are as
of the date of the
interview, unless
otherwise noted, and
are subject to
change.
</TABLE>
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
MESSAGE FROM THE PRESIDENT
Dear Investor,
Fiscal 1996 has been a year of economic strengthening, and the GT Global
Funds have benefited from low inflation and low interest rates worldwide.
We're proud of their performance over the past year and remain enthusiastic
about their long-term potential. We are also pleased to announce that this
year marks the 20th anniversary of the New Pacific Growth Fund. On January 19,
1977, this innovative Fund became one of the first U.S. mutual funds to
invest in the Asia Pacific Rim. Now 20 years later, it remains one of GT
Global's flagship Funds.
Consistent, above-average performance of GT Global Funds is our priority. To
that end, we enhanced the breadth and depth of our investment capabilities
this fall when Liechtenstein Global Trust (LGT), the parent company of GT
Global, acquired a premier institutional money manager, Chancellor Capital
Management. On October 31, 1996, Chancellor merged with LGT Asset Management,
the Funds' advisor, and the combined entity is now known as Chancellor LGT
Asset Management. This acquisition increased assets entrusted to LGT to over
$80 billion.
We are confident about the partnership's success because both firms share a
commitment to providing investors around the world with solutions to their
investment needs through combined, top-notch expertise. Individual investors
now have access to the same high-quality management services enjoyed by over
320 institutional investors, including some of the country's largest
organizations.
Chancellor's strengths--disciplined U.S. equity and fixed income processes
and professionals, coupled with proven fundamental and quantitative
investment capabilities--represent an ideal complement to LGT's advantages as
an experienced global investment manager with an extensive global
infrastructure. Chancellor LGT Asset Management's global investment team
includes 12 economists, 98 portfolio managers, 72 analysts and 19 traders
located in nine regional offices.
Warren Shaw, LGT's new Global Chief Investment Officer, has been the
principal architect of Chancellor's investment policies, with excellent
results. The disciplined, repeatable process he created leverages the
effectiveness of a strong investment team approach.
As always, we appreciate your continued confidence. Should you or your
adviser have any questions regarding GT Global Funds, please call us at
800-824-1580. One of our registered representatives will be happy to assist
you.
Sincerely,
/s/ WILLIAM J. GUILFOYLE
William J. Guilfoyle
President
GT Global Mutual Funds
1
<PAGE>
INVESTMENT OBJECTIVE
The GT Global New
Pacific Growth Fund
seeks long-term growth
of capital primarily
through a portfolio
of investments in the
equity markets of the
Asian Pacific Rim,
excluding Japan.
Japan was eliminated
from the Fund's Primary
Investment Area on
January 1, 1994.
GT GLOBAL NEW PACIFIC GROWTH FUND
Performance Summary
GT GLOBAL
NEW PACIFIC MSCI Pacific
GROWTH FUND ex-Japan
CLASS A Index
1/19/77 9525 10000
9525 9993.98
9629.78 9760.11
9686.93 9957.87
9629.78 10051.8
9658.35 10220.3
9944.1 10295.4
9572.63 9879.44
9782.18 9716.99
10058.4 9601.97
10363.2 9984.98
10534.6 9896.9
10706.1 10342.9
10734.7 10055
11087.1 9804.83
12410.4 10532.7
12246.5 11001
12314 11465.2
13895.5 12394.9
15245.5 13113.8
15775.8 14619.3
16441.2 14340.4
17048.7 14560.9
15573.3 12368.6
16190.5 12823.8
15930.1 13735.2
15428.7 13693.4
15208 13921.6
14194.2 13706.4
13816.6 14198
13762.7 13831.5
13568.6 14578
13913.7 15604.1
13881.4 17215.9
12425.3 16840.8
11778.1 17261.2
12641 19508.4
12781.2 22324.1
11993.9 22753.2
11306.2 18862.1
12087.5 20660.2
13047.3 22880.1
13940.2 25334.9
13717 26369.1
14386.6 27937
15324.2 28479.7
15993.9 32112.8
15904.5 31374.2
17143.4 31504.8
18036.3 30842.1
17645.7 29898.9
18108.8 30525.5
19026 31055.7
19898.4 32411.3
20838 32861.6
19764.2 29608.7
19294.4 27989.5
17001.5 23882.6
17650.2 23676.8
18891.8 27090.6
18902.9 26628.4
18332.5 25057.8
16766.6 22313.2
15741.2 20936.7
17334.9 23576.2
17604.7 24166.8
16207.1 21637.8
15876.1 20322.3
15103.7 19361.1
14601.1 18867.2
14441.7 18084.6
15765.7 17834.1
16967.2 19121.6
16685.2 21059
17114.3 21522.7
17556.4 20935.5
18090 22917.7
18948.9 22679.7
19443.4 22804.6
20250.3 24147.5
20601.7 24009
20536.6 23116.1
20653.8 23482.2
21499.7 24606.5
23282.7 25663.9
24193.7 27046.8
24362.9 26105.5
25605 26257.6
24939.9 26240.8
21428.4 23046.5
20683.5 22327.1
19526.3 22034.2
21787.5 23813.8
21907.2 23799.5
22559 23874.3
22718.6 24328.7
22585.6 23805.6
23210.7 25585
22359.5 24333
22491.2 24633.6
22603.2 25040.2
22813.1 25917.2
22379.2 25578.4
22995 28220.8
22925.1 27237
23820.8 28074.6
25122.4 29263
25234.3 28210.3
24688.5 27921.8
25472.3 29489.1
27109.8 28782.2
30077.5 29706.8
31897.9 32327.7
32752 32654.7
35552.6 31319
40873.5 29529.1
44458.2 31614.7
43380 33556.6
38283.1 38477.9
39851.3 38624.4
10/31/87 41951.7 41441.2
41881.7 42639.4
43576 48204.6
46870.4 49784.1
48191.5 50979.2
50912.6 54582.6
50676 56844.8
53673.2 62936.1
54935.2 66816.3
56078.8 69436
42690.1 39198.2
39767.8 40871.2
44356.3 43180
45151.7 42762.8
46314.1 42584.1
50168.6 47744.2
52799.3 50069
51942.8 53623.3
52248.7 54572.4
53686.5 56784.7
51331 53723.5
51208.6 52817.4
52677 56302.2
54053.6 56075.2
54648.6 56379.2
58368.9 62282.2
59994.7 57472.7
61933 58460.5
64152.7 60417.6
64684.2 57695
63433.6 55342.6
68811 60330
71218.2 62951
75845.2 64710.3
73094.1 62538.2
76783.1 62610.8
80946.6 65389.8
79662.7 64990
78057.9 64167.3
76774.1 63340.8
73949.6 60079.1
80946.6 65777.2
82744 67864.5
85953.6 71504.7
77287.6 66051.5
69777.1 60013.9
74848.3 59274.9
72216.4 58751.8
72075.3 58754.6
74393.7 62284.9
80871.6 68233.7
82644.6 69913.2
83121.9 72274.7
83871.9 72539.1
82099 72261.8
84349.3 76474.6
80121.6 75522.9
82780.9 76310.5
84826.6 79168.6
80394.3 78406.1
81494.4 80266.3
82071.3 82099.6
81422.3 84698.3
77672.1 84110.2
79114.5 88101
85533.1 94085
82792.5 93142.9
78249 90792.2
75508.5 85619.1
74643.1 84236.4
76662.4 86875.7
74715.2 85200.5
75008.8 85896.6
75081.5 86537.5
78573.7 93195.4
81629.3 94782
88104.4 99640
90796.2 103455
88031.6 100316
91378.3 103860
95598 111708
97198.6 113866
100909 132280
101127 128331
120468 154978
118342 150724
113328 143388
98744.5 128164
100719 134114
104289 138544
99352.2 132406
104441 139383
112037 148749
110822 144844
111050 147178
101555 135384
96698.3 133297
86948.5 121795
91423.8 133171
93581.6 134577
94780.3 136361
103012 145618
101413 142866
105889 148766
102292 144832
102932 146694
100854 144116
99735.1 145398
103900 151118
113565 161163
111482 163613
109482 165746
110649 170317
114065 168612
111649 165478
105816 157182
110565 164258
112982 168499
115648 173125
122397 182409
12/31/96 124725 182807
The chart above shows the performance of the GT Global New Pacific Growth
Fund, Class A shares, since the Fund's inception versus the MSCI Pacific
ex-Japan Index. This represents a cumulative return of 1147.25% and an
average annual total return of 13.48% for the Fund. 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. A $10,000
investment in the Fund's Class B shares at inception on April 1, 1993, would
have been valued at $14,517 on December 31, 1996. This figure reflects all
Fund expenses and the applicable contingent deferred sales charge (5% in the
first year, decreasing to 0% after six years), assuming a complete redemption
at the end of the period. A $10,000 investment in Advisor Class shares at
inception on June 1, 1995, would have been worth $12,184 on December 31, 1996.
AVERAGE ANNUAL TOTAL RETURNS %(1)
DECEMBER 31, 1996
<TABLE>
<CAPTION>
Share Class Without Sales Charge(2) With Sales Charge
1-Year 5-Year 10-Year LOF 1-Year 5-Year 10-Year LOF
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Class A(3) 20.04 8.88 11.51 13.76 14.34 7.83 10.97 13.48
Class B(3) 19.28 N/A N/A 11.05 14.28 N/A N/A 10.45
Advisor Class(4) 20.56 N/A N/A 13.26 N/A N/A N/A N/A
</TABLE>
HISTORICAL PERFORMANCE(2)
ANNUAL TOTAL RETURNS % (LAST 10 YEARS)
<TABLE>
<CAPTION>
1987 1988 1989 1990 1991 1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A 5.73(3) 23.20 48.12 -10.96 13.07 -7.96 60.61 -19.73 7.45 20.04
Class B N/A N/A N/A N/A N/A N/A 46.30(3) -20.30 6.54 19.28
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) This performance data do not reflect the maximum 4.75% sales charge and
the contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years) for Class A and Class B shares, respectively, which if
included, would have reduced performance quoted.
(3) The Fund began operations on January 19, 1977; Class B shares commenced
on April 1, 1993.
(4) 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 GT Global.
Please see the "Alternative Purchase Plan" section in the Fund's prospectus.
The above data 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.
2
<PAGE>
INTERVIEW WITH PORTFOLIO MANAGER JANUARY, 1997
LAWRENCE YIP
Q HOW DID THE FUND PERFORM?
A The Fund enjoyed a strong year, returning a total of 20.04% for Class A
shares (14.34% including the maximum 4.75% sales charge) over the 12-month
period to December 31, 1996; total return for Class B shares was 19.28%
(14.28% including the effect of the maximum 5% contingent deferred sales
charge). Total return for the Morgan Stanley Capital International (MSCI)
Pacific ex-Japan Index(5) over the same period was 20.97%.
Q HOW WOULD YOU CHARACTERIZE THE REGION'S
PERFORMANCE IN GENERAL?
A Performance varied significantly throughout the region in 1996. Hong Kong
proved the most robust market and, together with Malaysia and Indonesia,
considerably outperformed Korea, Thailand and Singapore (the Fund held
relatively minor positions in the latter three markets). Compared to the
index, the Fund benefited from security selection in Malaysia, in addition to
having an overweighted position there and an underweighted position in
Singapore. The Fund, however, suffered as a result of its minor position in
Thailand, where the index did not hold a position. In addition, the Fund's
performance was hindered by its security selection in the Philippines.
Hong Kong was fueled by a recovery in the property market and growing
optimism about the Chinese business cycle. The market is also optimistic
that the transition back to China will be smooth and prosperity will be
maintained.
In Malaysia, an improvement in its current account, together with
expectations that local interest rates had peaked, led foreign investors to
substantially increase their exposure to the market. Meanwhile, the
Indonesian market made strong gains in the first half of the year. The past
six months, however, were marked by increasing turbulence. The Jakarta market
fell on heavy profit-taking and political unrest, with the government's
suppression of key opposition figures in late summer.
Korea led the underperformers and continued to disappoint investors. The MSCI
Korea Index slid another 20% in the last quarter of the year on
deteriorating economic fundamentals, increasing stock supply and political
problems. The Thai market also underperformed other regional markets as the
economy weakened and the poor earnings outlook continued. Moreover, worries
over banking and finance companies' bad loans were also a factor. In total,
these concerns tended to affect the political arena, where accusations of
mismanagement and corruption culminated in the dissolution of Parliament at
the end of September.
Finally, the Singapore market ended down. Singapore's GDP growth in 1996 was
adversely affected by a slowdown in the electronics cycle. Property stocks
were the main engine for the Singapore stock market in 1996; however, given
the introduction of anti-speculative measures and the increase in supply of
residential housing, we believe private residential prices could weaken
further in 1997.
CONTINUED P.4
DIVERGENT RETURNS
ONE-YEAR RETURNS TO 12/31/96*
Hong Kong 33.08%
Indonesia 27.51
Malaysia 25.89
Singapore -6.86
Thailand -36.59
Korea -38.14
* Countries represented by their respective MSCI index.
(5) MSCI Pacific ex-Japan Index is an arithmetic average, weighted by market
value, of the performance of 216 securities listed on five major Pacific Rim
exchanges (Australia, Hong Kong, Malaysia, New Zealand and Singapore). It
includes the effect of reinvested dividends and is measured in U.S. dollars.
The index is unmanaged, not available for direct investment and does not
include the effects of sales charges and professional management fees.
3
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
Q HONG KONG IS BY FAR THE FUND'S LARGEST
REGIONAL HOLDING (41.6%(6) AT DECEMBER 31, 1996).
WHAT ACCOUNTS FOR YOUR ENTHUSIASM IN THIS
MARKET?
A We are confident the Hong Kong bull market has not yet run its course,
although we may see some consolidation in the first quarter of 1997. We
believe continuation of the cyclical recovery in China will result in a
decoupling of Hong Kong equities from the U.S. market. The potential for Hong
Kong companies to generate further value from China, in our opinion, should
not be underestimated and, as the market begins to discount China-generated
earnings acceleration in 1998, we expect the reratings of profits of
individual stocks (a dominant feature of the market in 1996) to continue.
There is, of course, the potential for market volatility with the handover to
China.
At the sector level, in addition to the obvious improvements in both the
property developers and investor sentiment, "red chips" (companies managed in
Hong Kong but with substantial business operations in China) have also
enjoyed a period of especially strong performance. Moreover, speculation
about potential asset injection and spinoffs have helped add fuel to
companies with Chinese provincial or ministerial parentage.
On the other hand, several utility monopolies are confronting tough operating
environments. In particular, Hong Kong's major telecommunications service
provider(7) is seeing new competition in domestic fixed lines by Wharf
Holdings, New World Development Co., and Hutchison Whampoa--all major
conglomerates with enough financial muscle to support competition in this
area. On the cellular side, the potential addition of six PCS--licensed
operators should also trigger a fierce battle over the next 12-18 months.
Most importantly, the latest pressure initiated by major U.S. telecoms to cut
international accounting rates severely damaged short-term prospects for the
country's major service provider.
Q WHAT COMPANIES IN PARTICULAR BENEFITED
THE FUND?
A A number of companies performed well over the period, including Australia's
Oil Search, China Resources Enterprise, Citic Pacific and New World
Development in Hong Kong. In Malaysia, PWE Industries, Perusahaan Otomobil
and Rashid Hussain produced strong returns. Rashid Hussain, the dominant
institutional brokerage firm, was involved in a major restructuring to form
the largest banking group in Malaysia. This transaction is the first of many
expected to pump new life into Malaysia's banking industry to help it survive
potential competition from further liberalization.
Q COULD YOU DESCRIBE THE FUND'S INVESTMENT
STRATEGY OVER THE PERIOD AND GOING FORWARD?
A In general, we increased the Fund's exposure to Hong Kong and Malaysia
(where we were significantly overweighted relative to the index at the end of
December). We reduced the Fund's allocations in Thailand and Singapore, and
are significantly underweighted in the latter market relative to the index.
Going forward, we intend to continue focusing on asset allocation, a strategy
that has paid off well over the last few months. We currently expect
allocation will favor both Hong Kong and Malaysia particularly, with other
countries performing a rather minimal role over the next few months. We
anticipate additional restructuring to take place in both these markets and
feel the portfolio is well positioned to benefit from that trend.
Q COULD YOU EXPLAIN SPECIFICALLY WHY YOU CUT
BACK THE FUND'S POSITION IN THAILAND AND
KOREA?
A Market conditions in Thailand and Korea remain questionable, and our
relatively low exposure helped keep damage to a minimum. There is no obvious
recovery in sight for either the Thai or Korean market, both of which
underperformed massively in 1996.
In Thailand, a recent decision by the central bank to curb foreign currency
financing placed upward pressure on domestic interest rates. As a result of
this high gearing and weakened demand for land, the property sector has
suffered. We believe narrowing interest margins and higher provision for
non-performing loans will put further pressure on earnings growth of Thai
banking and finance companies. While we anticipate a slight improvement in
the macroeconomic picture for Thailand in 1997, it is difficult to find
undervalued stocks.
CONTINUED P.5
(6) Please see table on page 5.
(7) There can be no assurance the Fund will invest in this company.
4
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
Meanwhile, the Korean market experienced a further selloff in tandem with the
growing current account deficit. Recent economic figures are uninspiring. The
trade deficit shows no improvement, as exports remain weak, imports are
growing at double-digit rates, inventories are increasing and short-term
liquidity conditions are deteriorating as corporates raise money to fund
their working capital needs. The majority of blue chips have been
underperforming the market due to continuing concern over poor exports.
In the short term, our market outlook remains gloomy, as we believe the
negative factors are unlikely to improve rapidly. For any sustainable market
recovery in 1997, we need to see a sharp slowdown in both inventory growth
and corporate facility investment. We are therefore unlikely to increase the
Fund's currently minimal position in this market.
Q WHAT IS YOUR OUTLOOK FOR THE PHILIPPINES?
A We are positive about the Philippine market. The country began to turn
around not long after Ramos took over as president several years ago.
Sensible economic policies have led to a strong boom, and the market is
performing well after the central bank's decision to cut bank reserve
requirements by 2% in the near term. Banks, which will benefit from any
margin improvement, have led the market's rise and are the sector we prefer.
Q WHAT ABOUT AUSTRALIA?
A The Australian market rose by nearly 18% in 1996, largely driven by easier
monetary policy and a consequent decline in bond yields, which fell by over
125 basis points during the year. The Reserve Bank reduced base rates by 50
points three times, to their current 6.0% level. This has produced diverging
performance within the market, the banking sector being the best performer
given the added impetus from expectations of mergers or takeovers. The oil
and gas sector also performed well on much stronger oil prices, while
resources and broader industrials have been disappointing, with most earnings
coming in below expectations.
We expect stronger earnings in 1997. Interest rate cuts should give rise to a
housing-led recovery in the domestic economy that would support related
cyclical sectors, such as building materials. In line with our economists'
view of more synchronized and rising global growth, commodity prices are
expected to improve and support the resource sector. Banks, however, are
likely to struggle to maintain earnings as competition increases, especially
in the mortgage market.
ABOUT THE PORTFOLIO MANAGER
LAWRENCE YIP - Portfolio Manager for Chancellor LGT Asset Management since
1988 and Investment Analyst for Taiwan and South Korea 1985-88. Previously,
Mr. Yip was a Credit Analyst with the Bank of Credit and Commerce Hong Kong,
Ltd. He received his B.A. from the University of Hong Kong.
GEOGRAPHIC ALLOCATION OF NET ASSETS %
1996 1995
DECEMBER 31 DECEMBER 31
Hong Kong 41.6 42.1
Malaysia 32.1 7.4
Philippines 9.7 2.6
Australia 7.3 11.0
Indonesia 1.9 0.7
Thailand 0.8 13.2
New Zealand 0.5 0.7
India 0.3 N/A
Korea 0.3 2.1
Singapore 0.2 3.3
China N/A 0.3
U.S. & Other 5.3 16.6
Allocations will change based on current market conditions.
5
<PAGE>
SECTOR ALLOCATION OF NET ASSETS %
DECEMBER 31, 1996
Finance 42.9
Capital Goods 17.3
Multi-Industry/Misc. 10.0
Consumer Durables 6.6
Materials/Basic Industry 5.8
Services 5.7
Energy 5.1
Consumer Non-Durables 1.1
Short Term & Other 5.5
Allocations will change based on current market conditions.
<TABLE>
<CAPTION>
GT GLOBAL NEW PACIFIC GROWTH FUND % of
KEY PORTFOLIO HOLDINGS(8) Country Net Assets
<S> <C> <C>
PWE INDUSTRIES BHD. A manufacturer of electrical equipment. Malaysia 5.1
NEW WORLD DEVELOPMENT CO., LTD. An investment holding company whose Hong Kong 4.8
subsidiaries are involved in property development and investment. The company
also has hotel operations, construction and civil engineering activities,
transportation and infrastructure investment.
HSBC HOLDINGS PLC Holding company for the HSBC Group. The group is an Hong Kong 4.3
international banking and financial services organization whose services
include a diverse range of financial operations (retail and corporate
banking, trade capital markets, private and investment banking, and
insurance).
EKRAN BHD. A diversified holding company with interests in property Malaysia 4.2
development, timber, investment holdings and air transportation.
CITIC PACIFIC LTD. A holding company with interests in Cathay Pacific, Wacan Hong Kong 4.0
Telecom and Hong Kong Telecom, two power stations in China and the Manhattan
Card Group. The company also has substantial property holdings.
RASHID HUSSAIN BHD. A financial services company that, through its Malaysia 3.9
subsidiaries, offers brokerage, underwriting and placement of shares, asset
management and property management services.
SUN HUNG KAI PROPERTIES LTD. A multi-industry conglomerate with an emphasis Hong Kong 3.6
on property development and investment.
CHEUNG KONG (HOLDINGS) LTD. Through subsidiaries, Cheung Kong is involved in Hong Kong 3.3
property development and investment, project and building management, and
cement and quarry operations. The company also operates a real estate agency.
GUANGZHOU INVESTMENT CO., LTD. An investment holding company. The principal Hong Kong 3.0
activities of its subsidiaries consist of property trading, development,
investment and related business, and investment in PRC industrial projects.
BELLE CORP. A developer of real estate properties. Through its subsidiaries, Philippines 2.9
it is also involved in investment holdings.
</TABLE>
(8) There can be no assurance the Fund will continue to hold these securities.
6
<PAGE>
GT GLOBAL
NEW PACIFIC
GROWTH FUND
FINANCIAL
STATEMENTS
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees of
GT Global Growth Series:
We have audited the accompanying statement of assets and liabilities of GT
Global New Pacific Growth Fund, a series of shares of beneficial interest of GT
Global Growth Series, including the schedule of portfolio investments, as of
December 31, 1996, the related statement of operations for the year then ended,
the statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the five years in the
period then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1996 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of GT
Global New Pacific Growth Fund as of December 31, 1996, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the five years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 14, 1997
F1
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Finance (42.9%)
New World Development Co., Ltd. ....................... HK 3,666,000 $ 24,767,067 4.8
REAL ESTATE
HSBC Holdings PLC ..................................... HK 1,027,600 21,989,630 4.3
BANKS-MONEY CENTER
Rashid Hussain Bhd. ................................... MAL 3,000,000 19,841,584 3.9
SECURITIES BROKER
Sun Hung Kai Properties Ltd. .......................... HK 1,530,000 18,744,182 3.6
REAL ESTATE
Cheung Kong (Holdings) Ltd. ........................... HK 1,883,000 16,738,589 3.3
REAL ESTATE
Guangzhou Investment Co., Ltd. ........................ HK 32,100,000 15,356,866 3.0
REAL ESTATE
Wharf (Holdings) Ltd. ................................. HK 2,500,000 12,477,373 2.4
REAL ESTATE
Hysan Development Co., Ltd. ........................... HK 2,769,000 11,027,308 2.1
REAL ESTATE
Malaysian Resources Corp., Bhd. ....................... MAL 2,524,000 9,946,059 1.9
REAL ESTATE
Lai Sun Development Co., Ltd. ......................... HK 5,000,000 7,564,003 1.5
REAL ESTATE
Metropolitan Bank & Trust Co. ......................... PHIL 300,000 7,425,743 1.4
BANKS-REGIONAL
Metroplex Bhd. ........................................ MAL 5,500,000 6,752,475 1.3
REAL ESTATE
Ayala Land, Inc. "B" .................................. PHIL 5,700,000 6,511,805 1.3
REAL ESTATE
Bank of East Asia Ltd. ................................ HK 1,222,600 5,437,993 1.1
BANKS-MONEY CENTER
Samanda Holdings Bhd. ................................. MAL 1,051,000 4,953,228 1.0
INVESTMENT MANAGEMENT
Public Bank Bhd. - Foreign ............................ MAL 2,199,333 4,659,973 0.9
BANKS-MONEY CENTER
HKR International Ltd. ................................ HK 2,258,960 3,811,666 0.7
REAL ESTATE
DCB Holdings Bhd. ..................................... MAL 990,000 3,391,485 0.7
BANKS-REGIONAL
Philippine Commercial International Bank-/- ........... PHIL 252,290 3,314,549 0.6
BANKS-MONEY CENTER
Wheelock & Co., Ltd. .................................. HK 1,000,000 2,851,047 0.6
REAL ESTATE
Megaworld Properties & Holdings, Inc.-/- .............. PHIL 5,888,500 2,354,503 0.5
REAL ESTATE
Bank of the Philippine Islands ........................ PHIL 362,430 2,194,454 0.4
BANKS-MONEY CENTER
Hong Kong Land Holdings Ltd.{\/} ...................... HK 603,353 1,677,321 0.3
REAL ESTATE INVESTMENT TRUST
PT Bank Internasional Indonesia - Foreign ............. INDO 1,464,666 1,442,333 0.3
BANKS-MONEY CENTER
State Bank of India Ltd. - GDR-/- {\/} ................ IND 75,100 1,304,487 0.3
BANKS-MONEY CENTER
</TABLE>
The accompanying notes are an integral part of the financial statements.
F2
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS (cont'd)
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Finance (Continued)
Amoy Properties Ltd. .................................. HK 613,500 $ 884,474 0.2
REAL ESTATE
China Resources Enterprise Ltd.-/- .................... HK 354,000 796,431 0.2
REAL ESTATE INVESTMENT TRUST
Overseas-Chinese Banking Corp., Ltd. - Foreign ........ SING 55,000 684,158 0.1
BANKS-REGIONAL
Malayan Banking Bhd. .................................. MAL 47,500 526,733 0.1
BANKS-MONEY CENTER
United Overseas Bank Ltd. - Foreign ................... SING 28,000 312,268 0.1
BANKS-MONEY CENTER
Siam Commercial Bank PLC - Foreign .................... THAI 22,600 163,941 --
BANKS-MONEY CENTER
MBF Capital Bhd. ...................................... MAL 6,000 9,743 --
OTHER FINANCIAL
Hong Leong Bank Bhd. .................................. MAL 1,000 3,485 --
BANKS-MONEY CENTER
--------------
219,916,956
--------------
Capital Goods (17.3%)
PWE Industries Bhd. ................................... MAL 1,358,000 26,353,267 5.1
ELECTRICAL PLANT/EQUIPMENT
Ekran Bhd. ............................................ MAL 5,196,000 21,812,911 4.2
MACHINERY & ENGINEERING
United Engineers Ltd. ................................. MAL 1,625,000 14,673,267 2.9
CONSTRUCTION
New World Infrastructure Ltd.-/- ...................... HK 4,165,563 12,172,449 2.4
INDUSTRIAL COMPONENTS
Mancon Bhd. ........................................... MAL 2,000,000 6,099,010 1.2
CONSTRUCTION
C & P Homes, Inc. ..................................... PHIL 8,308,900 4,271,521 0.8
CONSTRUCTION
Harbin Power Equipment Co., Ltd.-/- ................... HK 17,082,000 2,782,948 0.5
ELECTRICAL PLANT/EQUIPMENT
United Engineers Ltd., Convertible Unsecured Loan
Stock, 4% expires 5/22/99 ............................ MAL 522,500 424,208 0.1
CONSTRUCTION
Bandar Raya Developments Bhd. ......................... MAL 191,000 366,115 0.1
CONSTRUCTION
--------------
88,955,696
--------------
Multi-Industry/Miscellaneous (10.0%)
Citic Pacific Ltd. .................................... HK 3,534,000 20,516,757 4.0
CONGLOMERATE
Hutchison Whampoa ..................................... HK 1,864,000 14,641,583 2.8
MULTI-INDUSTRY
Gadek (Malaysia) Bhd. ................................. MAL 1,432,000 10,888,871 2.1
CONGLOMERATE
Pacific Dunlop Ltd. ................................... AUSL 1,030,000 2,618,575 0.5
MULTI-INDUSTRY
</TABLE>
The accompanying notes are an integral part of the financial statements.
F3
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS (cont'd)
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Multi-Industry/Miscellaneous (Continued)
E.R.G. Ltd. ........................................... AUSL 1,754,638 $ 2,230,413 0.4
MULTI-INDUSTRY
Wembley Industries Holdings Bhd.-/- ................... MAL 355,000 593,307 0.1
MULTI-INDUSTRY
Jardine Strategic Holdings Ltd.{\/} ................... HK 83,000 300,460 0.1
CONGLOMERATE
JG Summit Holdings Inc. "B" ........................... PHIL 748,000 210,784 --
CONGLOMERATE
Korea Fund, Inc.{\/} .................................. KOR 938 14,070 --
COUNTRY FUNDS
--------------
52,014,820
--------------
Consumer Durables (6.6%)
Edaran Otomobil Nasional Bhd. ......................... MAL 1,273,000 12,730,000 2.5
AUTOMOBILES
Perusahaan Otomobil Nasional Bhd. ..................... MAL 1,982,000 12,559,208 2.4
AUTOMOBILES
Uniwide Holdings, Inc.-/- ............................. PHIL 42,000,000 8,316,832 1.6
APPLIANCES & HOUSEHOLD
Samsung Electronics Co.: .............................. KOR -- -- 0.1
CONSUMER ELECTRONICS
New-/- .............................................. -- 10,204 525,642 --
Common .............................................. -- 1,430 86,110 --
--------------
34,217,792
--------------
Materials/Basic Industry (5.8%)
Western Mining Corporation Holdings Ltd. .............. AUSL 1,700,000 10,710,257 2.1
METALS - NON-FERROUS
Broken Hill Proprietary Co., Ltd. ..................... AUSL 658,893 9,380,601 1.8
MISC. MATERIALS & COMMODITIES
Cosco Pacific Ltd. .................................... HK 6,048,000 7,038,014 1.4
PAPER/PACKAGING
APC Group, Inc. ....................................... PHIL 1,000,000,000 1,142,422 0.2
MISC. MATERIALS & COMMODITIES
Oriental Press Group .................................. HK 1,280,000 575,123 0.1
PAPER/PACKAGING
PT Semen Cibinong - Foreign ........................... INDO 200,000 563,321 0.1
CEMENT
Pohang Iron & Steel Co., Ltd.-/- ...................... KOR 8,500 493,454 0.1
METALS - STEEL
--------------
29,903,192
--------------
Services (5.7%)
China Hong Kong Photo Products Holdings Ltd. .......... HK 20,466,000 6,880,217 1.3
WHOLESALE & INTERNATIONAL TRADE
PT Telekomunikasi Indonesia - Foreign ................. INDO 3,415,000 5,894,166 1.1
TELECOM - OTHER
News Corp., Ltd. ...................................... AUSL 948,933 5,005,891 1.0
BROADCASTING & PUBLISHING
</TABLE>
The accompanying notes are an integral part of the financial statements.
F4
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS (cont'd)
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Services (Continued)
Hong Kong & Shanghai Hotels ........................... HK 2,166,666 $ 4,090,163 0.8
LEISURE & TOURISM
Resorts World Bhd. .................................... MAL 750,000 3,415,842 0.7
LEISURE & TOURISM
Telecom Corporation of New Zealand Ltd. ............... NZ 484,000 2,469,248 0.5
TELEPHONE NETWORKS
Matichon Newspaper Group - Foreign .................... THAI 154,800 495,051 0.1
BROADCASTING & PUBLISHING
Television Broadcasts Ltd. ............................ HK 106,000 423,507 0.1
BROADCASTING & PUBLISHING
I.C.C. International Public Co., Ltd. - Foreign ....... THAI 60,059 299,815 0.1
WHOLESALE & INTERNATIONAL TRADE
--------------
28,973,900
--------------
Energy (5.1%)
Belle Corp.-/- ........................................ PHIL 54,100,000 15,039,223 2.9
OIL
Oil Search Ltd. ....................................... AUSL 3,987,000 7,760,507 1.5
OIL
Electricity Generating Public Co., Ltd. - Foreign ..... THAI 1,219,350 3,328,829 0.6
ELECTRICAL & GAS UTILITIES
Yukong Ltd.: .......................................... KOR -- -- 0.1
OIL
Common .............................................. -- 17,929 340,491 --
New-/- .............................................. -- 2,667 49,130 --
--------------
26,518,180
--------------
Consumer Non-Durables (1.1%)
R.J. Reynolds Bhd. .................................... MAL 1,360,000 3,689,505 0.7
TOBACCO
PT Indofood Sukses Makmur ............................. INDO 1,000,000 1,990,682 0.4
FOOD
--------------
5,680,187
-------------- -----
TOTAL EQUITY INVESTMENTS (cost $392,821,001) ............ 486,180,723 94.5
-------------- -----
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Hicom Holdings Bhd. Warrants, expire 12/18/00-/- ...... MAL 750,000 962,376 0.2
MISC. MATERIALS & COMMODITIES
Hysan Development Co., Ltd. Warrants, expire
4/30/98-/- ........................................... HK 200,950 181,879 --
REAL ESTATE
Hong Kong & Shanghai Hotels Warrants, expire
12/31/98-/- .......................................... HK 166,666 62,494 --
LEISURE & TOURISM
</TABLE>
The accompanying notes are an integral part of the financial statements.
F5
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS (cont'd)
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Hang Lung Development Co. Warrants, expire
10/31/97-/- .......................................... HK 36,500 $ 10,855 --
REAL ESTATE
Oriental Press Group Warrants due 12/31/98-/- ......... HK 128,000 9,103 --
PAPER/PACKAGING
-------------- -----
TOTAL WARRANTS (cost $357,315) .......................... 1,226,707 0.2
-------------- -----
TOTAL INVESTMENTS (cost $393,178,316) * ................ 487,407,430 94.7
Other Assets and Liabilities ............................ 27,216,429 5.3
-------------- -----
NET ASSETS .............................................. $ 514,623,859 100.0
-------------- -----
-------------- -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
* For Federal income tax purposes, cost is $393,178,316 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 106,594,790
Unrealized depreciation: (12,365,676)
-------------
Net unrealized appreciation: $ 94,229,114
-------------
-------------
</TABLE>
Abbreviation:
GDR--Global Depository Receipt
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at December 31, 1996, was concentrated in
the following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS {D}
-------------------------------------------
FIXED INCOME,
RIGHTS & SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY WARRANTS & OTHER TOTAL
- -------------------------------------- ------ ------------- ---------- -----
<S> <C> <C> <C> <C>
Australia (AUSL/AUD) ................. 7.3 7.3
Hong Kong (HK/HKD) ................... 41.6 41.6
India (IND/INR) ...................... 0.3 0.3
Indonesia (INDO/IDR) ................. 1.9 1.9
Korea (KOR/KRW) ...................... 0.3 0.3
Malaysia (MAL/MYR) ................... 31.9 0.2 32.1
New Zealand (NZ/NZD) ................. 0.5 0.5
Philippines (PHIL/PHP) ............... 9.7 9.7
Singapore (SING/SGD) ................. 0.2 0.2
Thailand (THAI/THB) .................. 0.8 0.8
United States & Other (US/USD) ....... 5.3 5.3
------ ----- ----- -----
Total ............................... 94.5 0.2 5.3 100.0
------ ----- ----- -----
------ ----- ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $514,623,859.
The accompanying notes are an integral part of the financial statements.
F6
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Assets:
Investments in securities, at value (cost $393,178,316) (Note 1).......................... $487,407,430
U.S. currency................................................................. $6,814,128
Foreign currencies (cost $5,414).............................................. 5,935 6,820,063
----------
Receivable for securities sold............................................................ 45,339,261
Receivable for Fund shares sold........................................................... 3,868,309
Dividends receivable...................................................................... 1,029,758
Cash held as collateral for securities loaned (Note 1).................................... 63,740,591
------------
Total assets............................................................................ 608,205,412
------------
Liabilities:
Payable for Fund shares repurchased....................................................... 28,846,604
Payable for investment management and administration fees (Note 2)........................ 426,970
Payable for service and distribution expenses (Note 2).................................... 234,903
Payable for transfer agent fees (Note 2).................................................. 143,695
Payable for printing and postage expenses................................................. 84,954
Payable for registration and filing fees.................................................. 32,587
Payable for professional fees............................................................. 29,043
Payable for custodian fees (Note 1)....................................................... 21,083
Payable for fund accounting fees (Note 2)................................................. 10,055
Payable for Trustees' fees and expenses (Note 2).......................................... 6,926
Other accrued expenses.................................................................... 4,142
Collateral for securities loaned (Note 1)................................................. 63,740,591
------------
Total liabilities....................................................................... 93,581,553
------------
Net assets.................................................................................. $514,623,859
------------
------------
Class A:
Net asset value and redemption price per share ($361,243,935 DIVIDED BY 27,535,860 shares
outstanding)............................................................................... $ 13.12
------------
------------
Maximum offering price per share (100/95.25 of $13.12) *.................................... $ 13.77
------------
------------
Class B:+
Net asset value and offering price per share ($151,805,064 DIVIDED BY 11,855,984 shares
outstanding)............................................................................... $ 12.80
------------
------------
Advisor Class:
Net asset value, offering price per share, and redemption price per share ($1,574,860
DIVIDED BY 119,633 shares outstanding)..................................................... $ 13.16
------------
------------
Net assets consist of:
Paid in capital (Note 4).................................................................. $391,221,530
Accumulated net realized gain on investments and foreign currency transactions............ 29,169,621
Net unrealized appreciation on translation of assets and liabilities in foreign
currencies............................................................................... 3,594
Net unrealized appreciation of investments................................................ 94,229,114
------------
Total -- representing net assets applicable to capital shares outstanding................... $514,623,859
------------
------------
<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.
F7
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
STATEMENT OF OPERATIONS
Year ended December 31, 1996
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income:
Dividend income (net of foreign withholding tax of $513,592) (Note 1)...................... $ 9,813,777
Interest income............................................................................ 1,152,414
------------
Total investment income.................................................................. 10,966,191
------------
Expenses:
Investment management and administration fees (Note 2)..................................... 5,260,774
Service and distribution expenses: (Note 2)
Class A..................................................................... $ 1,366,421
Class B..................................................................... 1,482,869 2,849,290
-----------
Transfer agent fees (Note 2)............................................................... 1,688,200
Custodian fees (Note 1).................................................................... 811,002
Registration and filing fees............................................................... 305,540
Printing and postage expenses.............................................................. 179,780
Fund accounting fees (Note 2).............................................................. 135,182
Audit fees................................................................................. 60,024
Legal fees................................................................................. 11,712
Trustees' fees and expenses (Note 2)....................................................... 9,882
Other expenses (Note 1).................................................................... 418,812
------------
Total expenses before reductions......................................................... 11,730,198
------------
Expense reductions (Note 1 & 5)........................................................ (737,169)
------------
Total net expenses....................................................................... 10,993,029
------------
Net investment loss.......................................................................... (26,838)
------------
Net realized and unrealized gain on investments and foreign currencies: (Note 1)
Net realized gain on investments.............................................. 94,626,790
Net realized loss on foreign currency transactions............................ (342,342)
-----------
Net realized gain during the year........................................................ 94,284,448
Net change in unrealized appreciation on translation of assets and liabilities
in foreign currencies........................................................ (106)
Net change in unrealized appreciation of investments.......................... 36,883,188
-----------
Net unrealized appreciation during the year.............................................. 36,883,082
------------
Net realized and unrealized gain on investments and foreign currencies....................... 131,167,530
------------
Net increase in net assets resulting from operations......................................... $131,140,692
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F8
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31, 1995
----------------- -----------------
<S> <C> <C>
Decrease in net assets
Operations:
Net investment income (loss)........................................ $ (26,838) $ 4,037,605
Net realized gain on investments and foreign currency
transactions....................................................... 94,284,448 17,716,911
Net change in unrealized appreciation (depreciation) on translation
of assets and liabilities in foreign currencies.................... (106) 6,315
Net change in unrealized appreciation of investments................ 36,883,188 36,706,715
----------------- -----------------
Net increase in net assets resulting from operations.............. 131,140,692 58,467,546
----------------- -----------------
Class A:
Distributions to shareholders: (Note 1)
From net investment income.......................................... -- (2,982,780)
From net realized gain on investments............................... (44,900,913) (13,196,301)
Class B:
Distributions to shareholders: (Note 1)
From net investment income.......................................... -- (228,209)
From net realized gain on investments............................... (18,754,735) (4,263,749)
Advisor Class:
Distributions to shareholders: (Note 1)
From net investment income.......................................... -- (11,427)
From net realized gain on investments............................... (250,756) (35,360)
----------------- -----------------
Total distributions............................................... (63,906,404) (20,717,826)
----------------- -----------------
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.................... 5,158,291,909 3,442,682,160
Decrease from capital shares repurchased............................ (5,226,446,724) (3,489,738,455)
----------------- -----------------
Net decrease from capital share transactions...................... (68,154,815) (47,056,295)
----------------- -----------------
Total decrease in net assets.......................................... (920,527) (9,306,575)
Net assets:
Beginning of year................................................... 515,544,386 524,850,961
----------------- -----------------
End of year*........................................................ $ 514,623,859 $ 515,544,386
----------------- -----------------
----------------- -----------------
--------------
*Includes undistributed net investment income of................... $ 0 $ 0
----------------- -----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F9
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
CLASS A+
----------------------------------------------------------
YEAR ENDED DECEMBER 31,
----------------------------------------------------------
1996 (D) 1995 (D) 1994 1993 1992
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.47 $ 12.10 $ 15.86 $ 10.31 $ 11.30
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment income (loss).......... 0.02 0.11 0.02 (0.03) 0.07
Net realized and unrealized gain
(loss) on investments................ 2.44 0.79 (3.15) 6.23 (0.97)
---------- ---------- ---------- ---------- ----------
Net increase (decrease) from
investment operations.............. 2.46 0.90 (3.13) 6.20 (0.90)
---------- ---------- ---------- ---------- ----------
Distributions to shareholders:
From net investment income............ -- (0.10) (0.01) -- (0.06)
From net realized gain on
investments.......................... (1.81) (0.43) (0.55) (0.65) (0.03)
In excess of net investment income.... -- -- -- -- --
In excess of net realized gain on
investments.......................... -- -- (0.07) -- --
---------- ---------- ---------- ---------- ----------
Total distributions................. (1.81) (0.53) (0.63) (0.65) (0.09)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period.......... $ 13.12 $ 12.47 $ 12.10 $ 15.86 $ 10.31
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return (c)............. 20.04% 7.45% (19.73)% 60.61% (7.96)%
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 361,244 $ 383,722 $ 404,680 $ 498,898 $ 281,418
Ratio of net investment income (loss) to
average net assets..................... 0.17% 0.91% 0.11% (0.3)% 0.6%
Ratio of expenses to average net assets:
With expense reductions (Notes 1 &
5)................................... 1.86% 1.89% 1.81% 1.9% 2.0%
Without expense reductions............ 1.99% 1.94% --* --* --*
Portfolio turnover rate++++............. 93% 63% 87% 117% 72%
Average commission rate per share paid
on portfolio transactions++++.......... $ 0.0032 N/A N/A N/A N/A
</TABLE>
- ----------------
+ All capitals 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 and average commission rates are calculated on the
basis of the Fund as a whole without distinguishing between the
classes of shares issued.
(a) Not annualized
(b) Annualized
(c) Total investment return does not include sales charges.
(d) These selected per share operating data were calculated based upon
average shares outstanding during the period.
* Calculation of "Ratio of expenses to average net assets" was made
without considering the effect of expense reductions, if any.
N/A Not applicable
The accompanying notes are an integral part of the financial statements.
F10
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
CLASS B++ ADVISOR CLASS+++
------------------------------------------------- ----------------------------
APRIL 1, 1993 YEAR JUNE 1, 1995
YEAR ENDED DECEMBER 31, TO ENDED TO
---------------------------------- DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 (D) 1995 (D) 1994 1993 1996 (D) 1995 (D)
---------- ---------- ---------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.29 $ 11.96 $ 15.79 $ 11.27 $ 12.45 $ 12.89
---------- ---------- ---------- ------------- ------------- -------------
---------- ---------- ---------- ------------- ------------- -------------
Income from investment operations:
Net investment income (loss).......... (0.06) 0.03 (0.06) (0.10) 0.07 0.09
Net realized and unrealized gain
(loss) on investments................ 2.38 0.75 (3.15) 5.27 2.45 0.05
---------- ---------- ---------- ------------- ------------- -------------
Net increase (decrease) from
investment operations.............. 2.32 0.78 (3.21) 5.17 2.52 0.14
---------- ---------- ---------- ------------- ------------- -------------
Distributions to shareholders:
From net investment income............ -- (0.02) -- -- -- (0.15)
From net realized gain on
investments.......................... (1.81) (0.43) (0.55) (0.65) (1.81) (0.43)
In excess of net investment income.... -- - (0.07) -- -- --
In excess of net realized gain on
investments.......................... -- -- -- -- -- --
---------- ---------- ---------- ------------- ------------- -------------
Total distributions................. (1.81) (0.45) (0.62) (0.65) (1.81) (0.58)
---------- ---------- ---------- ------------- ------------- -------------
Net asset value, end of period.......... $ 12.80 $ 12.29 $ 11.96 $ 15.79 $ 13.16 $ 12.45
---------- ---------- ---------- ------------- ------------- -------------
---------- ---------- ---------- ------------- ------------- -------------
Total investment return (c)............. 19.28% 6.54% (20.30)% 46.30%(a) 20.56% 1.07%(a)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 151,805 $ 130,887 $ 120,171 $ 72,122 $ 1,575 $ 935
Ratio of net investment income (loss) to
average net assets..................... (0.48)% 0.26% (0.54)% (0.9)%(b) 0.52% 1.26%
Ratio of expenses to average net assets:
With expense reductions (Notes 1 &
5)................................... 2.51% 2.54% 2.46% 2.5%(b) 1.51% 1.54%(b)
Without expense reductions............ 2.64% 2.59% --* --* 1.64% 1.59%(b)
Portfolio turnover rate++++............. 93% 63% 87% 117% 93% 63%
Average commission rate per share paid
on portfolio transactions++++.......... $ 0.0032 N/A N/A N/A $ 0.0032 N/A
</TABLE>
- ----------------
+ All capitals 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 and average commission rates are calculated on the
basis of the Fund as a whole without distinguishing between the
classes of shares issued.
(a) Not annualized
(b) Annualized
(c) Total investment return does not include sales charges.
(d) These selected per share operating data were calculated based upon
average shares outstanding during the period.
* Calculation of "Ratio of expenses to average net assets" was made
without considering the effect of expense reductions, if any.
N/A Not applicable
The accompanying notes are an integral part of the financial statements.
F11
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
NOTES TO FINANCIAL STATEMENTS
December 31, 1996
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
GT Global New Pacific Growth Fund ("Fund") is a separate series of GT 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 an open-end management investment company. The Company has
eight diversified 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. 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 expenses, and may differ
in its 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 and the
financial statements may include certain estimates made by management.
(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, 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 Chancellor LGT Asset Management, Inc. (the "Manager") to be the primary
market.
Fixed income securities 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 securities of comparative maturity, quality and type. However, when the
Manager 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 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 year
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, U.S. 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.
(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
F12
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
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, unless a quotation from only one
broker is available, in which case only that broker's price will be used. 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 in 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 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 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 "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 December 31, 1996, stocks with an aggregate value of approximately
$60,565,635 were on loan to brokers. The loans were secured by cash collateral
of $63,740,591, received by the Fund. 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 the year ended December 31, 1996,
the Fund received securities lending fees of $319,975 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, or excise tax on income
and capital gains.
F13
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
(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. The Fund's investments in emerging market
countries may involve greater risks than investments in more developed markets,
and the prices of such investments may be volatile. These risks of investing in
foreign and emerging 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.
(N) LINE OF CREDIT
The Fund, along with certain other funds advised by the Manager, has a line of
credit with the Bank of Boston. The arrangement with the bank allows all
specified funds to borrow an aggregate maximum amount of $100,000,000. For the
year ended December 31, 1996, the Fund periodically borrowed amounts at a money
market rate, all of which has been repaid by December 31, 1996.
For the year ended December 31, 1996, the weighted average outstanding daily
balance of bank loans (based on the number of days the loans were outstanding)
was $16,333,333 with a weighted average interest rate of 6.27%. Interest
incurred on this loan for the year ended December 31, 1996 was $25,611, included
in "Other Expenses" on the Statement of Operations.
2. RELATED PARTIES
Chancellor LGT Asset Management, Inc. is the Fund's investment manager and
administrator. On October 31, 1996, Chancellor Capital Management, Inc. merged
with LGT Asset Management, Inc., and the surviving entity was renamed Chancellor
LGT Asset Management, Inc. The Fund pays investment management and
administration fees at the following annualized rates: 0.975% on the first $500
million of average daily net assets on 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 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.
GT Global, Inc. ("GT Global"), an affiliate of the Manager, 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. GT 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 year ended December 31, 1996, GT Global retained
$133,060 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. GT Global collected CDSCs in
the amount of $19,470 for the year ended December 31, 1996. GT 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, GT 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 year ended December 31, 1996, GT Global collected CDSCs in
the amount of $636,270. In addition, GT 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 GT Global for a portion of its shareholder servicing and distribution
expenses. Under the Class A Plan, the Fund may pay GT 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 its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay GT 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 GT 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 GT 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 GT
F14
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
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 its 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.
The Manager and GT 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 the
Manager of investment management and administration fees, waivers by GT Global
of payments under the Class A Plan and/or Class B Plan and/or reimbursements by
the Manager or GT Global of portions of the Fund's other operating expenses.
GT Global Investor Services, Inc. ("GT Services"), an affiliate of the Manager
and GT Global, is the transfer agent of the Fund. For performing shareholder
servicing, reporting, and general transfer agent services, GT Services receives
an annual maintenance fee of $17.50 per account, a new account fee of $4.00 per
account, a per transaction fee of $1.75 for all transactions other than
exchanges and a per exchange fee of $2.25. GT Services also is reimbursed by the
Fund for its out-of-pocket expenses for such items as postage, forms, telephone
charges, stationery and office supplies.
The Manager is the pricing and accounting agent for the Fund. The monthly fee
for these services to the Manager is a percentage, not to exceed 0.03% annually,
of the Fund's average daily net assets. The annual fee rate is derived by
applying 0.03% of the first $5 billion of assets of all registered mutual funds
advised by the Manager and 0.02% to the assets in excess of $5 billion and
allocating the result according to the Fund's average daily net assets.
The Company pays each of its Trustees who is not an employee, officer or
director of the Manager, GT Global or GT 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 year ended December 31, 1996, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $479,521,098 and $557,132,554, respectively. There were
no purchases or sales of U.S. government obligations during the period.
F15
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
4. CAPITAL SHARES
At December 31, 1996, 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>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31, 1995
----------------------------- ------------------------------
SHARES AMOUNT SHARES AMOUNT
------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C>
CLASS A
- ---------------------------------------------
Shares sold.................................. 285,658,529 $3,783,795,259 213,508,812 $ 2,634,346,068
Shares issued in connection with reinvestment
of distributions........................... 2,934,435 37,677,963 1,069,849 13,241,922
------------- -------------- ------------- ---------------
288,592,964 3,821,473,222 214,578,661 2,647,587,990
Shares repurchased........................... (291,833,470) (3,895,314,036) (217,241,112) (2,697,556,175)
------------- -------------- ------------- ---------------
Net decrease................................. (3,240,506) $ (73,840,814) (2,662,451) $ (49,968,185)
------------- -------------- ------------- ---------------
------------- -------------- ------------- ---------------
YEAR ENDED YEAR ENDED
DECEMBER 31, 1996 DECEMBER 31, 1995
----------------------------- ------------------------------
SHARES AMOUNT SHARES AMOUNT
------------- -------------- ------------- ---------------
CLASS B
- ---------------------------------------------
Shares sold.................................. 96,986,480 $1,263,551,513 64,930,186 $ 788,928,928
Shares issued in connection with reinvestment
of distributions........................... 1,241,219 15,565,185 307,922 3,759,320
------------- -------------- ------------- ---------------
98,227,699 1,279,116,698 65,238,108 792,688,248
Shares repurchased........................... (97,020,480) (1,273,495,413) (64,636,995) (790,755,338)
------------- -------------- ------------- ---------------
Net increase................................. 1,207,219 $ 5,621,285 601,113 $ 1,932,910
------------- -------------- ------------- ---------------
------------- -------------- ------------- ---------------
JUNE 1, 1995
YEAR ENDED (COMMENCEMENT OF SALE OF
DECEMBER 31, 1996 SHARES) TO DECEMBER 31, 1995
----------------------------- ------------------------------
SHARES AMOUNT SHARES AMOUNT
------------- -------------- ------------- ---------------
ADVISOR CLASS
- ---------------------------------------------
Shares sold.................................. 4,311,411 $ 57,463,326 184,375 $ 2,360,516
Shares issued in connection with reinvestment
of distributions........................... 18,530 238,663 3,674 45,406
------------- -------------- ------------- ---------------
4,329,941 57,701,989 188,049 2,405,922
Shares repurchased........................... (4,285,455) (57,637,275) (112,902) (1,426,942)
------------- -------------- ------------- ---------------
Net increase................................. 44,486 $ 64,714 75,147 $ 978,980
------------- -------------- ------------- ---------------
------------- -------------- ------------- ---------------
</TABLE>
5. EXPENSE REDUCTIONS
The Manager has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1996, the Fund's
expenses were reduced by $417,194 under these arrangements.
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
For its fiscal year ended December 31, 1996, the total amount of income received
by the Fund from sources within foreign countries and possessions of the United
States was approximately $.39 per share (representing an approximate total of
$13,728,818). The total amount of taxes paid by the Fund to such countries was
approximately $.11 per share (representing an approximate total of $3,935,474).
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$58,445,881 as a capital gain dividend for the fiscal year ended December 31,
1996.
F16
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
NOTES
- --------------------------------------------------------------------------------
<PAGE>
GT GLOBAL NEW PACIFIC GROWTH FUND
GT GLOBAL MUTUAL FUNDS
GT GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY INVESTORS'
PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE GT GLOBAL
MUTUAL FUNDS, PLEASE CONTACT YOUR INVESTMENT COUNSELOR OR CALL GT 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
GT GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.
GT GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside the U.S.
GT GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies
/ / GLOBAL THEME FUNDS
GT GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide
GT GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture, or sell
telecommunications services or equipment
GT GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve, or maintain a country's infrastructure
GT GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products
GT GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore, or develop natural resources
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services
/ / REGIONALLY DIVERSIFIED FUNDS
GT GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan
GT GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe
GT GLOBAL LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America
/ / SINGLE COUNTRY FUNDS
GT GLOBAL AMERICA SMALL CAP GROWTH FUND
Invests in equity securities of small U.S. companies
GT GLOBAL AMERICA MID CAP GROWTH FUND
Concentrates on medium-sized companies in the U.S.
GT GLOBAL AMERICA VALUE FUND
Concentrates on large cap equity securities of U.S. companies believed to be
undervalued
GT GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market
GROWTH AND INCOME FUND
GT GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world
INCOME FUNDS
GT GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities
GT GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets
GT GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets
MONEY MARKET FUND
GT GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital
[LOGO]
THIS REPORT MUST BE ACCOMPANIED OR PRECEDED BY A CURRENT PROSPECTUS.
<PAGE>
[LOGO]
GT Global, Inc.
Fifty California Street
27th Floor
San Francisco, California
94111-4624
DATED MATERIAL
PLEASE EXPEDITE
GT GLOBAL NEW PACIFIC GROWTH FUND
NEWAR702M
