<PAGE> 1
SEMIANNUAL REPORT / JUNE 30 1999
AIM EUROPE GROWTH FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
<PAGE> 2
[COVER IMAGE]
-------------------------------------
RAIN, STEAM AND SPEED BY J.M.W. TURNER (1844)
J. M. W. TURNER LIKED TO PAINT EPIC SCENES OF CALAMITY IN
WHICH THE FURY OF THE ELEMENTS UNDERLINES HUMANITY'S INSIGNIFI-
CANCE WITHIN NATURE'S PLAN. SIMILAR TO THE TRAIN FIGHTING
THROUGH THE MIXED ELEMENTS, THIS SAME SPIRIT IS PROPELLING
EUROPE INTO ECONOMIC LEADERSHIP.
-------------------------------------
AIM Europe Growth Fund is for shareholders who seek long-term growth of capital.
The fund invests primarily in equity securities of issuers from European
companies.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Europe Growth Fund (formerly GT Global Europe Growth Fund) performance
figures are historical and reflect reinvestment of all distributions and
changes in net asset value.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B share
performance reflects the applicable contingent deferred sales charge (CDSC)
for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the fund's Class B and Class C shares will differ from
that of Class A shares due to differences in sales charge structure and
expenses.
o Because Class C shares have been offered for less than one year (since
5/3/99), all total return figures for Class C shares reflect cumulative
total return that has not been annualized.
o Advisor Class shares were closed to new investors on March 1, 1999.
o The fund's investment return and principal value will fluctuate so an
investor's shares, when redeemed, may be worth more or less than their
original cost.
o International investing presents certain risks not associated with investing
solely in the United States. These include risks relating to fluctuations in
the value of the U.S. dollar relative to the values of other currencies, the
custody arrangements made for the fund's foreign holdings, differences in
accounting, political risk, and the lesser degree of public information
required to be provided by non-U.S. companies.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The MSCI Europe Index is a group of unmanaged European securities tracked by
Morgan Stanley Capital International.
o The Standard & Poor's Composite Index of 500 Stocks (S&P 500) is a group of
unmanaged securities widely regarded by investors to be representative of
the stock market in general.
o The unmanaged Lipper European Funds Index represents an average of the
performance of the 30 largest European-region mutual funds. It is compiled
by Lipper Inc., an independent mutual-fund performance monitor.
o An investment cannot be made in any index listed. Unless otherwise
indicated, index results include reinvested dividends. They do not include
sales charges.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF A BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENT AGENCY. THERE IS A RISK THAT YOU
COULD LOSE SOME OR ALL OF YOUR MONEY.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the fund.
AIM EUROPE GROWTH FUND
<PAGE> 3
SEMIANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
With only several months remaining in 1999, the question on
[PHOTO OF many of your minds may be, "How will the year 2000 computer
Charles T. issue affect AIM and my investments?" We would like you to
Bauer, feel comfortable. We are pleased to be able to report to you
Chairman of that as of June 1999 we achieved a major milestone toward
the Board of year 2000 compliance status: we have successfully completed
THE FUND the testing of all of our mission-critical systems.
APPEARS HERE] Earlier this year, AIM participated in an industrywide
test that gave us a chance to see how our technology systems
might be affected by the changeover to the year 2000 (Y2K).
Everything went as well as we had hoped; in general, the
industry sailed through the testing process with flying
colors. The financial industry has been seen as a leader in
planning for year 2000 concerns. Thus, it was no surprise to
most participants that the test was an overwhelming success.
The general purpose of the process was to test
electronic interfaces among financial industry members in the United States and
to follow transactions through a typical trading cycle--from order entry to the
settlement process. Investment banks, broker-dealers, custodian banks and mutual
fund companies all worked together to make this possible. Approximately 400
firms were involved in the testing; AIM was one of 70 asset managers.
During the testing process, thousands of transactions were submitted and
approximately 260,000 steps were tested. Of those, only a handful experienced
minor glitches--just 0.02% of the total number of transactions. All problems
were worked through quickly before the hypothetical trades were settled. Of
course, AIM will keep testing and planning throughout 1999 as a precaution.
AIM'S INTERNAL EFFORTS CONTINUE
As you know from our previous communications to you, AIM has been addressing the
year 2000 issue for several years. Now that we have finished adjusting our
applications and systems, our focus for the rest of 1999 is to continue
monitoring the year 2000 readiness status of outside sources we're linked to
electronically. On the investment side, our portfolio management staff is
continually evaluating the Y2K preparedness of the domestic and foreign
companies in which we invest.
We feel that our preparations for 2000 are very comprehensive, and the
industrywide testing showed that our colleagues in the financial industry are
also working hard to be ready for the new year. We do not think shareholders
need to take any extraordinary measures with their investments to prepare for
2000. However, if you have any lingering concerns, it may reassure you to know
that AIM is finalizing contingency plans that will be ready if necessary. Our
plans will give AIM employees guidelines to follow for a wide variety of
situations.
For a more comprehensive discussion of our Y2K efforts and for periodic
updates, please visit our Web site, www.aimfunds.com.
We are pleased to send you this report covering your fund's performance over
the last six months. If you have any questions or comments, please contact our
Client Services department at 800-959-4246, or e-mail your inquiry to us at
[email protected]. You can access information about your account through our
automated AIM Investor Line at 800-246-5463 or at our Web site.
Thank you for your continued participation in The AIM Family of
Funds--Registered Trademark--. We appreciate your business.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
A I M Advisors, Inc.
-------------------------------------
THE FINANCIAL INDUSTRY
HAS BEEN SEEN AS A
LEADER IN PLANNING FOR
YEAR 2000 CONCERNS.
-------------------------------------
PLEASE NOTE THAT THE INFORMATION ABOUT THE YEAR 2000 IN THIS LETTER IS DEEMED
AIM'S YEAR 2000 READINESS DISCLOSURE.
AIM EUROPE GROWTH FUND
<PAGE> 4
SEMIANNUAL REPORT / MANAGERS' OVERVIEW
MARKET REVERSAL CHALLENGES FUND
HOW DID AIM EUROPE GROWTH FUND PERFORM DURING THE PAST SIX-MONTHS?
During the reporting period, there was a reversal of a years-long trend in
international markets--Asia, Japan and Latin America outperformed Europe. This
negatively affected the performance of AIM Europe Growth Fund, which invests in
European growth stocks. The fund's six-month total return was a disappointing
- -3.57% for Class A shares and -3.87% for Class B shares. The fund's Class C
shares commenced trading on May 3, 1999, and their cumulative return through
June 30, 1999, was .27%. These returns are at net asset value, excluding sales
charges. The fund's Advisor Class shares returned -3.41% for the first six
months of 1999.
WHAT WERE THE MAJOR TRENDS IN EUROPEAN MARKETS?
The European economy is slowing, particularly in Germany. We're seeing earnings
disappointments from some companies. The introduction of the euro in January
created a new common currency for 11 countries. The euro started strong against
the dollar but weakened as it became clear that the U.S. economy was growing
much faster than the European economy.
At the same time, there are a number of reasons for optimism:
o The new European Central Bank dropped interest rates in April to stimulate
the economy and boost confidence in Europe. Lower interest rates bode well
for stocks.
o There's a positive side to the decline of the euro: European exporters are
now much more competitive and their earnings should accelerate once sales
rise.
o European companies are more focused on shareholder value. For example, the
Italian government forced a shareholder vote in the hostile takeover attempt
of Telecom Italia, the country's largest telecommunications company. The
introduction of the euro triggered a massive wave of mergers and
acquisitions as companies strive to improve their strategic position in the
"new Europe."
o While recent earnings have declined, European companies have long-term
growth expectations superior to those in the United States.
WHICH HOLDINGS WERE PARTICULARLY STRONG?
Telecommunications companies have performed well. Two of our top holdings are
Nokia and Mannesman.
We believe Finland-based Nokia, the world's largest wireless phone company,
is poised for future growth as deregulation continues in the European
telecommunications industry. Many analysts expect Nokia to continue widening its
lead over its competitors. Mannesmann is a German engineering and
telecommunications conglomerate that retains its roots in industrial areas such
as seamless tubes and automotive products while rapidly increasing its
telecommunications operations. The company built the first private telephone
network in Germany.
Another holding we liked was French retailer Carrefour, which operates more
than 300 "hypermarkets" around the globe. These stores offer everything from
food and appliances to insurance and financial services.
WHAT'S YOUR OUTLOOK FOR THE NEXT SIX MONTHS?
Further interest-rate cuts could occur across Europe, a move that would benefit
large-company stocks in which the fund invests. Over the long run, we expect the
earnings picture to improve as privatization, deregulation and restructuring
take hold. Companies become more efficient when they move from government
control to private ownership because they are forced to trim costs to become
leaner and more competitive.
European companies have long-term growth expectations superior to those of
American companies. And European stocks are selling at a cheaper price compared
to U.S. stocks. We think the fund may benefit from these trends in the long
term.
================================================================================
AVERAGE ANNUAL TOTAL RETURNS
As of 6/30/99, including sales charges
CLASS A SHARES
Inception (7/19/85) 11.82%
10 years 6.11
5 years 9.31
1 year -16.60*
CLASS B SHARES
Inception (4/1/93) 9.88%
5 years 9.58
1 year -16.43**
CLASS C SHARES
Inception (5/3/99) -.73%***
ADVISOR CLASS SHARES
Inception (6/1/95) 12.58%
1 year -11.69
*-11.76% excluding sales charges
**-12.32 excluding CDSC
***cumulative return; .27% excluding CDSC
*Advisor Class shares were closed to new investors on March 1, 1999.
================================================================================
MARKET VOLATILITY CAN SIGNIFICANTLY AFFECT SHORT-TERM PERFORMANCE. RESULTS
OF AN INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM
THE HISTORICAL PERFORMANCE SHOWN.
-------------------------------------
THE INTRODUCTION OF THE EURO TRIG-
GERED A MASSIVE WAVE OF MERGERS AND
ACQUISITIONS AS COMPANIES STRIVE TO
IMPROVE THEIR STRATEGIC POSITION IN
THE "NEW EUROPE."
-------------------------------------
See important Fund and index disclosures inside front cover.
AIM EUROPE GROWTH FUND
2
<PAGE> 5
SEMIANNUAL REPORT / MANAGERS' OVERVIEW
PORTFOLIO COMPOSITION
As of June 30, 1999, based on total net assets
Total number of holdings: 68
<TABLE>
<CAPTION>
=================================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 INDUSTRIES TOP 10 COUNTRIES
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. EM.TV Merchandising A.G. (Germany) 3.55% 1. Telephone 10.65% 1. United Kingdom 19.18%
2. Vodafone Airtouch PLC (United Kingdom) 3.36 2. Computers (Software & Services) 6.83 2. France 13.95
3. Nokia Oyj A.B.-Class A (Finland) 3.14 3. Communications Equipment 6.35 3. Germany 14.90
4. Mannesmann A.G. (Germany) 2.69 4. Telecommunications (Cellular/Wireless) 5.77 4. Netherlands 9.22
5. Equant N.V. (Netherlands) 2.69 5. Services (Commercial & Consumer) 5.53 5. Finland 7.79
6. MobilCom A.G. (Germany) 2.47 6. Machinery (Diversified) 4.31 6. Spain 7.45
7. Carrefour S.A. (France) 2.41 7. Automobiles 4.07 7. Sweden 6.42
8. TNT Post Group N.V. (Netherlands) 2.33 8. Healthcare (Drugs - Generic & Other) 3.89 8. Switzerland 5.51
9. Tietoenator Oyj Abp (Finland) 2.17 9. Banks (Major Regional) 3.82 9. Italy 3.91
10. Telefonaktiebolaget LM Ericsson-Class B 2.16 10. Broadcasting (Television, Radio & Cable) 3.55 10. Ireland 1.07
(Sweden)
The fund's portfolio is subject to change, and there is no assurance that the fund will continue to hold any particular security.
=================================================================================================================================
</TABLE>
SHAREHOLDER UPDATE
IMPORTANT CHANGES COMING TO YOUR FUND
We are pleased to inform you of the following changes in your fund's name and
investment focus, which we believe will position the fund to benefit from
promising changes under way in European equity markets.
Effective in September, AIM Europe Growth Fund is changing its name to AIM
Euroland Growth Fund. The fund's primary investment area will be European
nations that are members of the European Economic and Monetary Union (EMU) and
have the euro as their common currency. These nations are Austria, Belgium,
Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal
and Spain. The fund will invest the majority of its assets in these Euroland
countries. Remaining assets may be invested in non-EMU developed countries. In
addition, the fund will focus 65% of its assets on large-capitalization
companies of developed countries. These changes do not alter the fund's
investment objective, which is long-term growth of capital.
We believe these changes will enable the fund to capitalize on a number of
positive trends in the Euroland financial markets:
* Price comparison of goods, services and labor across Euroland should be much
easier with a common currency.
* Such price transparency is likely to force companies to become more
competitive. The pace of mergers and acquisitions in Europe has already stepped
up.
* Equity markets are expected to become broader and more liquid as the EMU
nations find it easier to attract capital across borders.
[GRAPHIC OF EUROPE] THE
NETHERLANDS
BELGIUM
IRELAND
LUXEMBOURG
FRANCE
PORTUGAL
SPAIN
FINLAND
GERMANY
AUSTRIA
ITALY
If you have any questions about these changes, please contact your financial
consultant or AIM at 800-959-4246 or via e-mail at [email protected].
See important Fund and index disclosures inside front cover.
AIM EUROPE GROWTH FUND
3
<PAGE> 6
SCHEDULE OF INVESTMENTS
June 30, 1999
(Unaudited)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-88.35%
AUSTRIA-0.04%
Primamedic Ltd. (Health
Care-Medical Products & Supplies)(a) 78,059 $ 166,809
- --------------------------------------------------------------
BELGIUM-0.86%
Mobistar S.A.
(Telecommunications-Cellular/
Wireless)(a) 76,688 3,793,663
- --------------------------------------------------------------
FINLAND-7.79%
Helsingin Puhelin Oyj (Helsinki
Telephone Corp.-HPY)
(Telecommunications-Cellular/
Wireless) 132,600 6,286,248
- --------------------------------------------------------------
Nokia Oyj A.B.-Class A
(Communications Equipment) 157,064 13,758,963
- --------------------------------------------------------------
Raisio Group PLC (Foods) 500,807 4,645,185
- --------------------------------------------------------------
Tietoenator Oyj Abp
(Computers-Software & Services) 228,328 9,506,719
- --------------------------------------------------------------
34,197,115
- --------------------------------------------------------------
FRANCE-13.95%
Altran Technologies, S.A.
(Services-Commercial & Consumer) 30,384 8,016,320
- --------------------------------------------------------------
Axa (Insurance-Multi-Line) 37,862 4,616,134
- --------------------------------------------------------------
Carrefour S.A. (Retail-Food Chains) 72,000 10,573,956
- --------------------------------------------------------------
Dassault Systemes S.A.
(Computers-Software & Services) 177,694 5,869,363
- --------------------------------------------------------------
Elf Aquitaine S.A. (Oil &
Gas-Refining & Marketing) 40,000 5,866,175
- --------------------------------------------------------------
Genset-ADR (Biotechnology)(a) 130,685 2,041,953
- --------------------------------------------------------------
L'Oreal S.A. (Personal Care) 6,500 4,391,129
- --------------------------------------------------------------
Pinault-Printemps-Redoute S.A.
(Retail-General Merchandise) 17,100 2,932,510
- --------------------------------------------------------------
PSA Peugeot Citreon (Automobiles) 30,000 4,730,454
- --------------------------------------------------------------
Sanofi-Synthelabo S.A. (Health
Care-Drugs-Generic & Other) 120,000 5,089,103
- --------------------------------------------------------------
Sidel S.A. (Machinery-Diversified) 58,500 7,108,203
- --------------------------------------------------------------
61,235,300
- --------------------------------------------------------------
GERMANY-10.97%
DaimlerChrsyler A.G. (Automobiles) 50,000 4,328,520
- --------------------------------------------------------------
EM.TV & Merchandising A.G.
(Broadcasting-Television, Radio
& Cable)(a) 11,063 15,563,085
- --------------------------------------------------------------
Intershop Communications A.G.
(Computers-Software & Services)(a) 20,000 4,812,902
- --------------------------------------------------------------
Mannesmann A.G.
(Machinery-Diversified) 79,250 11,818,380
- --------------------------------------------------------------
MobilCom A.G.
(Telecommunications-Cellular/
Wireless) 121,347 10,855,227
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
GERMANY-(CONTINUED)
Sixt A.G. (Financial-Diversified) 10,751 $ 751,223
- --------------------------------------------------------------
48,129,337
- --------------------------------------------------------------
GREECE-1.00%
STET Hellas Telecommunications S.A.-ADR
(Telecommunications-
Cellular/Wireless)(a) 196,532 4,397,403
- --------------------------------------------------------------
IRELAND-1.07%
Esat Telecom Group PLC-ADR
(Telecommunications-Long Distance)(a) 106,600 4,677,075
- --------------------------------------------------------------
ITALY-3.91%
Autogrill S.p.A. (Restaurants) 475,000 4,890,455
- --------------------------------------------------------------
Credito Italiano S.p.A.
(Banks-Major Regional) 958,892 4,209,877
- --------------------------------------------------------------
Mediolanum S.p.A.
(Insurance-Life/Health) 875,230 6,719,990
- --------------------------------------------------------------
Tecnost S.p.A. (Computers-Software
& Services)(a) 545,191 1,342,879
- --------------------------------------------------------------
17,163,201
- --------------------------------------------------------------
NETHERLANDS-8.59%
Equant N.V. (Computers-Networking)(a) 128,138 11,806,077
- --------------------------------------------------------------
ING Groep N.V. (Insurance Brokers) 116,578 6,307,628
- --------------------------------------------------------------
Koninklijke Numico N.V. (Foods) 129,000 4,566,743
- --------------------------------------------------------------
TNT Post Group N.V. (Air Freight) 429,341 10,243,385
- --------------------------------------------------------------
Wolters Kluwer N.V. (Specialty
Printing) 120,000 4,773,739
- --------------------------------------------------------------
37,697,572
- --------------------------------------------------------------
NORWAY-0.58%
Tomra Systems A.S.A.
(Manufacturing-Specialized) 67,700 2,542,804
- --------------------------------------------------------------
PORTUGAL-1.03%
BPI-SGPS, S.A. (Banks-Regional) 197,342 4,171,860
- --------------------------------------------------------------
BPI-SGPS, S.A. (Banks-Regional),
Certificates 17,220 361,150
- --------------------------------------------------------------
4,533,010
- --------------------------------------------------------------
SPAIN-7.45%
Banco Santander Central Hispano
S.A. (Banks-Regional)(a) 500,000 5,204,530
- --------------------------------------------------------------
Tabacalera S.A.-Class A (Tobacco) 281,400 5,684,212
- --------------------------------------------------------------
Telefonica Publicidad e
Informacion S.A. (Telephone)(a) 400,000 7,976,844
- --------------------------------------------------------------
Telefonica S.A. (Telephone) 179,328 8,632,095
- --------------------------------------------------------------
TelePizza, S.A. (Restaurants)(a) 1,000,000 5,173,612
- --------------------------------------------------------------
32,671,293
- --------------------------------------------------------------
SWEDEN-6.42%
Assa Abloy A.B. (Metal Fabricators),
Rts., expiring 07/02/00 629,468 133,484
- --------------------------------------------------------------
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SWEDEN-(CONTINUED)
Assa Abloy A.B.-Class B (Metal
Fabricators)(a) 629,468 $ 6,822,497
- --------------------------------------------------------------
Securitas A.B.-Class B
(Services-Commercial & Consumer)(a) 390,000 5,835,125
- --------------------------------------------------------------
Skandia Forsakrings A.B.
(Insurance Brokers) 314,494 5,891,031
- --------------------------------------------------------------
Telefonaktiebolaget LM
Ericsson-Class B (Communications
Equipment) 295,180 9,476,223
- --------------------------------------------------------------
28,158,360
- --------------------------------------------------------------
SWITZERLAND-5.51%
Novartis A.G. (Health Care-Diversified) 1,808 2,638,483
- --------------------------------------------------------------
Roche Holding A.G. (Health
Care-Drugs-Generic & Other) 565 5,804,372
- --------------------------------------------------------------
Swisscom A.G. (Telephone) 12,146 4,567,927
- --------------------------------------------------------------
UBS A.G. (Bank-Major Regional) 20,525 6,122,533
- --------------------------------------------------------------
Zurich Allied A.G.
(Insurance-Multi-Line) 8,853 5,031,213
- --------------------------------------------------------------
24,164,528
- --------------------------------------------------------------
UNITED KINGDOM-19.18%
Abbey National PLC (Savings & Loan
Companies) 253,301 4,755,255
- --------------------------------------------------------------
BP Amoco PLC (Oil & Gas-Refining &
Marketing) 471,997 8,459,113
- --------------------------------------------------------------
COLT Telecom Group PLC
(Communications Equipment)(a) 220,000 4,615,575
- --------------------------------------------------------------
Compass Group PLC
(Services-Commercial & Consumer) 240,000 2,379,507
- --------------------------------------------------------------
Corporate Services Group PLC
(Services- Commercial & Consumer) 2,047,816 2,711,411
- --------------------------------------------------------------
Diageo PLC (Beverages-Alcoholic) 499,547 5,216,598
- --------------------------------------------------------------
Energis PLC (Telephone)(a) 92,600 2,208,386
- --------------------------------------------------------------
Glaxo Wellcome PLC (Health
Care-Drugs-Generic & Other) 221,436 6,153,549
- --------------------------------------------------------------
Lloyds TSB Group PLC (Banks-Major
Regional) 475,860 6,450,639
- --------------------------------------------------------------
Misys PLC (Services-Commercial &
Consumer) 619,741 5,304,386
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM-(CONTINUED)
Orange PLC (Telephone)(a) 589,401 $ 8,640,103
- --------------------------------------------------------------
SmithKline Beecham PLC (Health
Care-Diversified) 658,272 8,555,022
- --------------------------------------------------------------
Unilever PLC (Foods) 446,429 3,972,291
- --------------------------------------------------------------
Vodafone Airtouch PLC
(Telecommunications-Cellular/Wireless) 747,220 14,722,569
- --------------------------------------------------------------
84,144,404
- --------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$356,742,360) 387,671,874
- --------------------------------------------------------------
FOREIGN NON-CONVERTIBLE PREFERRED
STOCKS-3.93%
GERMANY-3.93%
Porsche A.G.-Pfd. (Automobiles) 3,741 8,790,482
- --------------------------------------------------------------
SAP A.G.-Pfd. (Computers-Software
& Services) 21,153 8,447,609
- --------------------------------------------------------------
17,238,091
- --------------------------------------------------------------
Total Foreign Non-Convertible
Preferred Stocks (Cost
$19,695,756) 17,238,091
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
NON-U.S. DOLLAR DENOMINATED
NON-CONVERTIBLE BONDS & NOTES-0.63%(B)
NETHERLANDS-0.63%
Tecnost International N.V.
(Financial-Diversified)
Floating Rate Note, 4.487%,
06/23/04 (Cost $1,536,498) EUR 2,635,091 2,763,240
- --------------------------------------------------------------
REPURCHASE AGREEMENT-3.20%(C)
State Street Bank & Trust Co.,
4.70%, 07/01/99 (Cost
$14,046,000)(d) $14,046,000 14,046,000
- --------------------------------------------------------------
TOTAL INVESTMENTS-96.11% 421,719,205
- --------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-3.89% 17,059,739
- --------------------------------------------------------------
NET ASSETS-100.00% $438,778,944
==============================================================
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Pfd. - Preferred
Rts. - Rights
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Foreign denominated security. Par value and coupon are denominated in
currency indicated.
(c) Collateral on repurchase agreements, including the Fund's pro-rata interest
in joint repurchase agreements, is taken into possession by the Fund upon
entering into the repurchase agreement. The collateral is marked to market
daily to ensure its market value is at least 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds, private
accounts and certain non-registered investment companies managed by the
investment advisor or its affiliates.
(d) Repurchase agreement entered into 06/30/99 with a maturing value
$14,047,834. Collaterized by U.S. Treasury securities.
See Notes to Financial Statements.
5
<PAGE> 8
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1999
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$392,020,615) $421,719,205
- ---------------------------------------------------------
Foreign currencies, at value (cost
$11,348,257) 11,293,360
- ---------------------------------------------------------
Receivables for:
Investments sold 13,440,658
- ---------------------------------------------------------
Fund shares sold 3,732,080
- ---------------------------------------------------------
Dividends and interest 770,787
- ---------------------------------------------------------
Other assets 66,346
- ---------------------------------------------------------
Total assets 451,022,436
- ---------------------------------------------------------
LIABILITIES:
Payable for:
Fund shares reacquired 1,210,568
- ---------------------------------------------------------
Investments purchased 10,368,191
- ---------------------------------------------------------
Accrued management fees 7,641
- ---------------------------------------------------------
Accrued distribution fees 417,993
- ---------------------------------------------------------
Accrued transfer agent fees 112,475
- ---------------------------------------------------------
Accrued operating expenses 126,624
- ---------------------------------------------------------
Total liabilities 12,243,492
- ---------------------------------------------------------
Net assets applicable to shares outstanding $438,778,944
=========================================================
NET ASSETS:
Class A $356,376,335
=========================================================
Class B $ 79,919,965
=========================================================
Class C $ 1,234,939
=========================================================
Advisor Class $ 1,247,705
=========================================================
SHARES OUTSTANDING, $0.01 PAR VALUE PER
SHARE:
Class A 23,465,526
=========================================================
Class B 5,425,770
=========================================================
Class C 83,860
=========================================================
Advisor Class 81,304
=========================================================
Class A:
Net asset value and redemption price per
share $ 15.19
- ---------------------------------------------------------
Offering price per share:
(Net asset value of $15.19
divided by 94.50%) $ 16.07
=========================================================
Class B:
Net asset value and offering price per
share $ 14.73
=========================================================
Class C:
Net asset value and offering price per
share $ 14.73
=========================================================
Advisor Class:
Net asset value, redemption and offering
price per share $ 15.35
=========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the six months ended June 30, 1999
(Unaudited)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $535,555 foreign
withholding tax) $ 3,778,208
- ---------------------------------------------------------
Interest 362,831
- ---------------------------------------------------------
Security lending 152,017
- ---------------------------------------------------------
Total investment income 4,293,056
- ---------------------------------------------------------
EXPENSES:
Management fees 2,350,060
- ---------------------------------------------------------
Administrative services fees 70,408
- ---------------------------------------------------------
Custodian Fees 234,206
- ---------------------------------------------------------
Interest Expense 26,850
- ---------------------------------------------------------
Trustees fees 9,172
- ---------------------------------------------------------
Distribution fees -- Class A 685,234
- ---------------------------------------------------------
Distribution fees -- Class B 445,349
- ---------------------------------------------------------
Distribution fees -- Class C 41
- ---------------------------------------------------------
Transfer agent fees -- Class A 575,359
- ---------------------------------------------------------
Transfer agent fees -- Class B 130,876
- ---------------------------------------------------------
Transfer agent fees -- Class C 23
- ---------------------------------------------------------
Transfer agent fees -- Advisor Class 2,092
- ---------------------------------------------------------
Other 244,201
- ---------------------------------------------------------
Total expenses 4,773,871
- ---------------------------------------------------------
Less: Expenses paid indirectly and expense
reductions (27,369)
- ---------------------------------------------------------
Net expenses 4,746,502
- ---------------------------------------------------------
Net investment income (loss) (453,446)
- ---------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES AND FOREIGN
CURRENCIES:
Net realized gain (loss) from:
Investment securities 27,739,776
- ---------------------------------------------------------
Foreign currencies (1,552,383)
- ---------------------------------------------------------
26,187,393
- ---------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of:
Investment securities (35,834,714)
- ---------------------------------------------------------
Foreign currencies (72,887)
- ---------------------------------------------------------
(35,907,601)
- ---------------------------------------------------------
Net gain (loss) from investment
securities and
foreign currencies (9,720,208)
- ---------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations $(10,173,654)
=========================================================
</TABLE>
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended June 30, 1999 and the year ended December 31, 1998
(Unaudited)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1999 1998
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (453,446) $ (1,850,722)
- --------------------------------------------------------------------------------------------
Net realized gain from investment securities and foreign
currencies 26,187,393 119,057,197
- --------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities and foreign currencies (35,907,601) 6,407,261
- --------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations (10,173,654) 123,613,736
- --------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains on
investment securities:
Class A -- (28,578,354)
- --------------------------------------------------------------------------------------------
Class B -- (6,161,419)
- --------------------------------------------------------------------------------------------
Advisor Class -- (89,449)
- --------------------------------------------------------------------------------------------
Share transactions-net:
Class A (51,677,525) (70,039,206)
- --------------------------------------------------------------------------------------------
Class B (16,798,858) 9,973,443
- --------------------------------------------------------------------------------------------
Class C 1,233,310 --
- --------------------------------------------------------------------------------------------
Advisor Class (456,501) (3,320,390)
- --------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (77,873,228) 25,398,361
- --------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 516,652,172 491,253,811
- --------------------------------------------------------------------------------------------
End of period $438,778,944 $516,652,172
============================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $296,502,558 $364,202,132
- --------------------------------------------------------------------------------------------
Undistributed net investment income (loss) (453,446) --
- --------------------------------------------------------------------------------------------
Undistributed net realized gain from investment securities
and foreign currencies 113,092,600 86,905,207
- --------------------------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 29,637,232 65,544,833
- --------------------------------------------------------------------------------------------
$438,778,944 $516,652,172
============================================================================================
</TABLE>
See Notes to Financial Statements.
7
<PAGE> 10
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Europe Growth Fund (the "Fund") is a separate series of AIM Growth Series
(the "Trust"). The Trust is organized as a Delaware business trust and is
registered under the Investment Company Act of 1940, as amended ("1940 Act"), as
an open-end series management investment company consisting of six separate
series portfolios, each having an unlimited number of shares of beneficial
interest. The Fund currently offers four different classes of shares: Class A
shares, Class B shares, Class C shares and Advisor Class shares. Class A shares
are sold with a front-end sales charge. Class B shares and Class C shares are
sold with a contingent deferred sales charge. Advisor Class shares are sold
without a sales charge. Effective March 1, 1999, the Fund has discontinued sales
of the Advisor Class shares to new investors. Matters affecting each portfolio
or class will be voted on exclusively by the shareholders of such portfolio or
class. The assets, liabilities and operations of each portfolio are accounted
for separately. Information presented in these financial statements pertains
only to the Fund. The Fund's investment objective is long-term growth of
capital.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates. The following is a
summary of significant accounting policies in conformity with generally accepted
accounting principles consistently followed by the Fund in the preparation of
the financial statements.
A. Security Valuations-Each equity security is valued at its last sales price
on the exchange where the security is principally traded or, lacking any
sales on a particular day, the security is valued at the last available bid
price on that day. Each security reported on the NASDAQ National Market
System is valued at the last sales price on the valuation date or absent a
last sales price, at the closing bid price on that day. Debt securities are
valued on the basis of prices provided by an independent pricing service.
Prices provided by the pricing service may be determined without exclusive
reliance on quoted prices, and may reflect appropriate factors such as
institution-size trading in similar groups of securities, developments
related to special securities, yield, quality, coupon rate, maturity, type
of issue, individual trading characteristics and other market data.
Securities for which market prices are not provided by any of the above
methods are valued based upon quotes furnished by independent sources and
are valued at the last bid price in the case of equity securities and in the
case of debt obligations, the mean between the last bid and asked prices.
Securities for which market quotations are not readily available or are
questionable are valued at fair value as determined in good faith by or
under the supervision of the Trust's officers in a manner specifically
authorized by the Board of Trustees. Short-term obligations having 60 days
or less to maturity are valued on the basis of amortized cost. For purposes
of determining net asset value per share, futures and options contracts
generally will be valued 15 minutes after the close of trading of the New
York Stock Exchange ("NYSE").
Generally, trading in foreign securities, corporate bonds, U.S.
Government securities and money market instruments is substantially
completed each day at various times prior to the close of the NYSE. The
values of such securities used in computing the net asset value of the
Fund's shares are determined at such times. Foreign currency exchange rates
are also generally determined prior to the close of the NYSE. Occasionally,
events affecting the values of such securities and such exchange rates may
occur between the times at which such values are determined and the close of
the NYSE, which will not be reflected in the computation of the Fund's net
asset value. If events materially affecting the value of such securities
occur during such period, then these securities will be valued at their fair
value as determined in good faith by or under the supervision of the Board
of Trustees of the Trust.
B. Securities Transactions, Investment Income and Distributions-Securities
transactions are accounted for on a trade date basis. Realized gains or
losses on sales are computed on the basis of specific identification of the
securities sold. Interest income is recorded as earned from settlement date
and is recorded on the accrual basis. Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Such distributions, if
any, are declared and paid annually.
C. Federal Income Taxes-The Fund intends to comply with the requirements of the
Internal Revenue Code necessary to qualify as a regulated investment company
and, as such, will not be subject to federal income taxes on otherwise
taxable income (including net realized capital gains) which is distributed
to shareholders. Therefore, no provision for federal income taxes is
recorded in the financial statements.
D. Expenses-Distribution and transfer agency expenses directly attributable to
a class of shares are charged to that class' operations. All other expenses
are allocated among the classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Fund's investment manager and administrator.
The Fund pays AIM fees at an annual rate of 0.975% on the first $500 million of
the Fund's average daily net assets, plus 0.95% on the next $500 million of the
Fund's average daily net assets, plus 0.925% on the next $500 million of the
Fund's average daily net assets, plus 0.90% on the Fund's average daily net
assets exceeding $1.5 billion. AIM has contractually agreed to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expense) to the maximum annual rate of 2.00%, 2.65%, 2.65%, and 1.65% of the
average daily net assets of the Fund's Class A, Class B, Class C, and Advisor
Class shares, respectively.
8
<PAGE> 11
A I M Fund Services, Inc. ("AFS") is the transfer agent of the Fund. The
Fund, pursuant to a transfer agency and service agreement, has agreed to pay AFS
a fee for providing transfer agency and shareholder services to the Fund. During
the six months ended June 30, 1999, AFS was paid $663,597 for such services.
The Trust has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B, Class C and Advisor Class shares of the Fund. The Trust has
adopted distribution plans pursuant to Rule 12b-1 under the 1940 Act with
respect to the Fund's Class A shares and Class C shares (the "Class A and C
Plan"), and the Fund's Class B shares (the "Class B Plan") (collectively, the
"Plans"). The Fund, pursuant to the Class A and C Plan, pays AIM Distributors
compensation at an annual rate of 0.35% of the average daily net assets of the
Class A shares and 1.00% of the average daily net assets of the Class C shares.
The Fund pursuant to the Class B Plan, pays AIM Distributors compensation at an
annual rate of 1.00% of the average daily net assets of the Class B shares. Of
these amounts, the Fund may pay a service fee of 0.25% of the average daily net
assets of the Class A, Class B or Class C shares to selected dealers and
financial institutions who furnish continuing personal shareholder services to
their customers who purchase and own the appropriate class of shares of the
Fund. Any amounts not paid as a service fee under the Plans would constitute an
asset-based sales charge. The Plans also impose a cap on the total sales
charges, including asset-based sales charges that may be paid by the respective
classes. During the six months ended June 30, 1999, the Class A, Class B and
Class C shares paid AIM Distributors $685,234, $445,349 and $41, respectively,
as compensation under the Plans.
AIM is the pricing and accounting agent for the Fund. The monthly fee for
these services paid to AIM is a percentage, not to exceed 0.03% annually, of a
Fund's average daily net assets. The annual fee rate is derived based on the
aggregate net assets of the funds which comprise the following investment
companies: AIM Growth Series, AIM Investment Funds, AIM Series Trust, G.T.
Global Variable Investment Series and G.T. Global Variable Investment Trust. The
fee is calculated at the rate of 0.03% of the first $5 billion of assets and
0.02% to the assets in excess of $5 billion. An amount is allocated to and paid
by each such fund based on its relative average daily net assets. Effective July
1, 1999, the Trust entered into a master administrative services agreement with
AIM, replacing the above pricing and accounting agreement. The Fund has agreed
to pay AIM for certain administrative costs incurred in providing accounting
services to the Fund.
AIM Distributors received commissions of $31,826 from sales of the Class A
shares of the Fund during the six months ended June 30, 1999. Such commissions
are not an expense of the Fund. They are deducted from, and are not included in,
the proceeds from sales of Class A shares. During the six months ended June 30,
1999, AIM Distributors received $2,879 in contingent deferred sales charges
imposed on redemptions of Fund shares. Certain officers and trustees of the
Trust are officers and directors of AIM, AIM Distributors and AFS.
NOTE 3-EXPENSE REDUCTIONS
During the six months ended June 30, 1999, the Fund received reductions in
custodian fees of $2,385 under an expense offset arrangement and AIM directed
certain portfolio trades to brokers who then paid $24,984 of the Fund's
expenses. The effect of the above arrangements resulted in reductions of the
Fund's total expenses of $27,369 during the six months ended June 30, 1999.
NOTE 4-TRUSTEES' FEES
Trustees' fees represent remuneration accrued to trustees who are not an
"interested person" of AIM.
NOTE 5-BANK BORROWINGS
The Fund, along with certain other funds advised and/or administered by AIM, has
lines of credit with BankBoston and State Street Bank & Trust Company. The
arrangements with the banks allow the Fund and certain other funds to borrow, on
a first come, first served basis, an aggregate maximum amount of $250,000,000.
The Fund is limited to borrowing up to 33 1/3% of the Fund's total assets.
Effective May 28, 1999, the above lines of credit were replaced by the
Fund's participation in a committed line of credit facility with a syndicate
administered by The Chase Manhattan Bank. The Fund may borrow up to the lesser
of (i) $975,000,000 or (ii) the limits set by its prospectus for borrowings. The
Fund and other funds advised by AIM which are parties to the line of credit may
borrow on a first come, first served basis. The funds which are party to the
line of credit are charged a commitment fee of 0.09% on the unused balance of
the committed line. The commitment fee is allocated among the funds based on
their respective average net assets for the period.
For the six months ended June 30, 1999, the average outstanding daily
balance of bank loans for the Fund was $958,497 with a weighted average interest
rate of 5.57%. Interest expense for the Fund for the six months ended June 30,
1999 was $26,850.
NOTE 6-PORTFOLIO SECURITIES LOANED
At June 30, 1999, securities with an aggregate value of $28,651,487 were on loan
to brokers. The loans were secured by cash collateral of $31,919,329 received by
the Fund. For the six months ended June 30, 1999, the Fund received fees of
$152,017 for securities lending.
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 the amount at
least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. The
cash collateral is invested in a securities lending trust which consists of a
portion of high quality short duration securities whose average effective
duration is restricted to 120 days or less.
9
<PAGE> 12
NOTE 7-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the six months ended June 30, 1999 was
$165,169,031 and $256,830,217, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
on a tax basis, as of June 30, 1999 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of investment
securities $ 62,511,961
- ----------------------------------------------------------------
Aggregate unrealized (depreciation) of investment
securities (36,819,116)
- ----------------------------------------------------------------
Net unrealized appreciation of investment
securities $ 25,692,845
================================================================
Cost of investments for tax purposes is $396,026,360
</TABLE>
NOTE 8-SHARE INFORMATION
Changes in the Fund's shares outstanding during six months ended June 30, 1999
and the year ended December 31, 1998 were as follows:
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1999 1998
--------------------------- ------------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ------------ ---------------
<S> <C> <C> <C> <C>
Sold:
Class A 50,274,414 $ 799,558,598 284,179,353 $ 4,678,178,730
- -----------------------------------------------------------------------------------
Class B 2,948,398 45,056,045 29,683,015 488,430,227
- -----------------------------------------------------------------------------------
Class C* 83,860 1,233,310 -- --
- -----------------------------------------------------------------------------------
Advisor Class 457,073 7,328,398 6,484,352 109,346,851
- -----------------------------------------------------------------------------------
Issued as
reinvestment of
dividends:
Class A -- -- 1,565,424 23,371,501
- -----------------------------------------------------------------------------------
Class B -- -- 370,423 5,382,231
- -----------------------------------------------------------------------------------
Advisor Class -- -- 5,605 84,332
- -----------------------------------------------------------------------------------
Reacquired:
Class A (53,293,933) (851,236,123) (287,680,343) (4,771,589,437)
- -----------------------------------------------------------------------------------
Class B (4,073,981) (61,854,903) (29,265,734) (483,839,015)
- -----------------------------------------------------------------------------------
Advisor Class (479,637) (7,784,899) (6,610,936) (112,751,573)
- -----------------------------------------------------------------------------------
(4,083,806) $ (67,699,574) (1,268,841) $ (63,386,153)
===================================================================================
</TABLE>
* Class C shares commenced sales May 3, 1999.
10
<PAGE> 13
NOTE 9-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A and Class B
outstanding during the six months ended June 30, 1999 and each of the years in
the five-year period ended December 31, 1998, for a share of Class C capital
stock outstanding during May 3, 1999 (date sales commenced) through June 30,
1999 and for a share of Advisor Class capital stock outstanding during the six
months ended June 30, 1999, each of the years in three-year period ended
December 31, 1998 and the period June 1, 1995 (date operations commenced)
through December 31, 1995.
<TABLE>
<CAPTION>
Class A
------------------------------------------------------------------
December 31,
June 30, ----------------------------------------------------
1999 1998(a) 1997(a) 1996(a) 1995(a) 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 15.67 $ 14.32 $ 12.89 $ 10.88 $ 10.03 $ 10.84
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income (loss) (0.01) (0.03) (0.04) (0.03) 0.04 0.06
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Net realized and unrealized gain (loss) on
investments (0.47) 2.35 1.48 2.16 0.95 (0.69)
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Net increase (decrease) from investment operations (0.48) 2.32 1.44 2.13 0.99 (0.63)
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Distributions to shareholders:
From net investment income -- -- -- -- (0.10) (0.05)
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
From net realized gains -- (0.97) (0.01) (0.12) (0.04) --
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
In excess of net realized gains -- -- -- -- -- (0.13)
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Total distributions -- (0.97) (0.01) (0.12) (0.14) (0.18)
- ------------------------------------------------------- -------- -------- -------- -------- -------- --------
Net asset value, end of period $ 15.19 $ 15.67 $ 14.32 $ 12.89 $ 10.88 $ 10.03
======================================================= ======== ======== ======== ======== ========= ========
Total return(b) (3.06)% 16.63% 11.20% 19.61% 9.86% (5.80)%
======================================================= ======== ======== ======== ======== ========= ========
Ratios and supplemental data:
Net assets, end of period (000s omitted) $356,376 $415,066 $407,004 $453,792 $483,375 $646,313
======================================================= ======== ======== ======== ======== ========= ========
Ratios of expenses to average net assets, excluding
interest expense:
With expense waivers(c) 1.85%(d) 1.75% 1.75% 1.82% 1.83% 1.73%
======================================================= ======== ======== ======== ======== ========= ========
Without expense waivers 1.85%(d) 1.75% 1.89% 1.88% 1.89% 1.81%
======================================================= ======== ======== ======== ======== ========= ========
Ratio of net investment income (loss) to average net
assets: (0.07)%(d) (0.20)% (0.29)% (0.26)% 0.38% 0.61%
======================================================= ======== ======== ======== ======== ========= ========
Ratio of interest expense to average net assets 0.01% 0.27% n/a n/a n/a n/a
======================================================= ======== ======== ======== ======== ========= ========
Portfolio turnover rate 35% 97% 107% 123% 108% 91%
======================================================= ======== ======== ======== ======== ========= ========
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Does not deduct sales charges and is not annualized for periods less than
one year.
(c) Prior to the period ended June 30, 1999, ratios include expense reductions.
(d) Ratios are annualized and based on average net assets of $394,807,178.
<TABLE>
<CAPTION>
Class B
----------------------------------------------------------
December 31,
June 30, -----------------------------------------------
1999 1998(a) 1997(a) 1996(a) 1995(a) 1994
-------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 15.26 $ 14.06 $ 12.73 $ 10.81 $ 9.97 $ 10.79
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Income from investment operations:
Net investment income (loss) (0.06) (0.14) (0.13) (0.11) (0.03) --
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Net realized and unrealized gain (loss) on investments (0.47) 2.31 1.47 2.15 0.94 (0.69)
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Net increase (decrease) from investment operations (0.53) 2.17 1.34 2.04 0.91 (0.69)
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Distributions to shareholders:
From net investment income -- -- -- -- (0.03) --
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
From net realized gains -- (0.97) (0.01) (0.12) (0.04) --
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
In excess of net realized gains -- -- -- -- -- (0.13)
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Total distributions -- (0.97) (0.01) (0.12) (0.07) (0.13)
- ------------------------------------------------------------ ------- ------- ------- ------- ------- -------
Net asset value, end of period 14.73 $ 15.26 $ 14.06 $ 12.73 $ 10.81 $ 9.97
============================================================ ======= ======= ======= ======= ======= =======
Total return(b) (3.47)% 15.80% 10.55% 18.79% 9.20% (6.38)%
============================================================ ======= ======= ======= ======= ======= =======
Ratios and supplemental data:
Net assets, end of period (in 000s) $79,920 $99,943 $81,011 $87,092 $73,025 $81,602
============================================================ ======= ======= ======= ======= ======= =======
Ratio of expenses to average net assets, excluding interest
expense:
With expense waivers(c) 2.50%(d) 2.40% 2.40% 2.47% 2.48% 2.38%
============================================================ ======= ======= ======= ======= ======= =======
Without expense waivers 2.50%(d) 2.40% 2.54% 2.53% 2.54% 2.46%
============================================================ ======= ======= ======= ======= ======= =======
Ratio of net investment income (loss) to average net assets: (0.72)%(d) (0.85)% (0.94)% (0.91)% (0.27)% (0.04)%
============================================================ ======= ======= ======= ======= ======= =======
Ratio of interest expense to average net assets 0.01% 0.27% n/a n/a n/a n/a
============================================================ ======= ======= ======= ======= ======= =======
Portfolio turnover rate 35% 97% 107% 123% 108% 91%
============================================================ ======= ======= ======= ======= ======= =======
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Does not deduct sales charges and is not annualized for periods less than
one year.
(c) Prior to the period ended June 30, 1999, ratios include expense reductions.
(d) Ratios are annualized and based on average net assets of $89,807,902.
11
<PAGE> 14
NOTE 9-FINANCIAL HIGHLIGHTS-(CONTINUED)
<TABLE>
<CAPTION>
Class C
--------
May 3, Advisor Class
1999 ------------------------------------------------
through December 31,
June 30, June 30, -------------------------------------
1999 1999 1998(a) 1997(a) 1996(a) 1995(a)
-------- -------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $14.64 $15.82 $14.41 $12.92 $10.85 $10.24
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income (loss) -- 0.02 0.02(b) 0.01 0.01 0.08
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Net realized and unrealized gain (loss) on investments 0.09 (0.49) 2.36 1.49 2.18 0.71
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Net increase (decrease) from investment operations 0.09 (0.47) 2.38 1.50 2.19 0.79
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Distributions to shareholders:
From net investment income -- -- -- -- -- (0.14)
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
From net realized gains -- -- (0.97) (0.01) (0.12) (0.04)
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Total distributions -- -- (0.97) (0.01) (0.12) (0.18)
- ------------------------------------------------------------ ------ ------ ------ ------ ------ ------
Net asset value, end of period $14.73 $15.35 $15.82 $14.41 $12.92 $10.85
============================================================ ====== ====== ====== ====== ====== ======
Total return(b) 0.61% (2.97)% 16.88% 11.64% 20.21% 7.75%
============================================================ ====== ====== ====== ====== ====== ======
Ratios and supplemental data:
Net assets, end of period (in 000s) $1,235 $1,248 $1,643 $3,239 $1,416 $718
============================================================ ====== ====== ====== ====== ====== ======
Ratio of expenses to average net assets, excluding interest
expense:
With expense waivers(c) 2.50%(d) 1.50%(d) 1.40% 1.40% 1.47% 1.48%(e)
============================================================ ====== ====== ====== ====== ====== ======
Without expense waivers 2.50%(d) 1.50%(d) 1.40% 1.54% 1.53% 1.54%(e)
============================================================ ====== ====== ====== ====== ====== ======
Ratio of net investment income (loss) to average net assets: (0.72)%(d) 0.28%(d) 0.15% 0.06% 0.09% 0.73%(e)
============================================================ ====== ====== ====== ====== ====== ======
Ratio of interest expense to average net assets 0.01% 0.01% 0.27% n/a n/a n/a
============================================================ ====== ====== ====== ====== ====== ======
Portfolio turnover rate 35% 35% 97% 107% 123% 108%
============================================================ ====== ====== ====== ====== ====== ======
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Does not deduct sales charges and is not annualized for periods less than
one year.
(c) Prior to the period ended June 30, 1999, ratios include expense reductions.
(d) Ratios are annualized and based on average net assets of $25,361, $1,435,266
and Class C and Advisor Class, respectively.
(e) Annualized.
12
<PAGE> 15
<TABLE>
<CAPTION>
BOARD OF TRUSTEES OFFICERS OFFICE OF THE FUND
<S> <C> <C>
C. Derek Anderson Robert H. Graham 11 Greenway Plaza
President, Plantagenet Capital Chairman and President Suite 100
Management, LLC (an investment Houston, TX 77046
partnership); Chief Executive Officer, Dana R. Sutton
Plantagenet Holdings, Ltd. Vice President and Treasurer INVESTMENT MANAGER
(an investment banking firm)
Samuel D. Sirko A I M Advisors, Inc.
Frank S. Bayley Vice President and Secretary 11 Greenway Plaza
Partner, law firm of Suite 100
Baker & McKenzie Melville B. Cox Houston, TX 77046
Vice President
Robert H. Graham SUB-ADVISOR
President and Chief Executive Officer, Gary T. Crum
A I M Management Group Inc. Vice President INVESCO Asset Management Limited
11 Devonshire Square
Arthur C. Patterson Carol F. Relihan London EC2M 4YR
Managing Partner, Accel Partners Vice President England
(a venture capital firm)
Mary J. Benson TRANSFER AGENT
Ruth H. Quigley Assistant Vice President and
Private Investor Assistant Treasurer A I M Fund Services, Inc.
P.O. Box 4739
Sheri Morris Houston, TX 77210-4739
Assistant Vice President and
Assistant Treasurer CUSTODIAN
Nancy L. Martin State Street Bank and Trust Company
Assistant Secretary 225 Franklin Street
Boston, MA 02110
Ofelia M. Mayo
Assistant Secretary COUNSEL TO THE FUND
Kathleen J. Pflueger Kirkpatrick & Lockhart LLP
Assistant Secretary 1800 Massachusetts Avenue, N.W.
Washington, D.C. 20036-1800
COUNSEL TO THE TRUSTEES
Paul, Hastings, Janofsky & Walker LLP
Twenty Third Floor
555 South Flower Street
Los Angeles, CA 90071
DISTRIBUTOR
A I M Distributors, Inc.
11 Greenway Plaza
Suite 100
Houston, TX 77046
</TABLE>
<PAGE> 16
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc.
AIM Aggressive Growth Fund(1) AIM Money Market Fund has provided leadership in
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund the mutual-fund industry
AIM Capital Development Fund since 1976 and managed
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS approximately $121 billion
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund in assets for more than 6.3
AIM Large Cap Growth Fund AIM Asian Growth Fund million shareholders,
AIM Mid Cap Equity Fund(A) AIM Developing Markets Fund including individual
AIM Select Growth Fund AIM Europe Growth Fund investors, corporate clients
AIM Small Cap Growth Fund(B) AIM European Development Fund and financial institutions,
AIM Small Cap Opportunities Fund AIM International Equity Fund as of June 30, 1999.
AIM Value Fund AIM Japan Growth Fund The AIM Family of
AIM Weingarten Fund AIM Latin American Growth Fund Funds--Registered
AIM New Pacific Growth Fund Trademark-- is distributed
GROWTH & INCOME FUNDS nationwide, and AIM today is
AIM Advisor Flex Fund GLOBAL GROWTH FUNDS the 10th-largest mutual-fund
AIM Advisor Large Cap Value Fund AIM Global Aggressive Growth Fund complex in the United States
AIM Advisor Real Estate Fund AIM Global Growth Fund in assets under management,
AIM Balanced Fund according to Strategic
AIM Basic Value Fund(C) GLOBAL GROWTH & INCOME FUNDS Insight, an independent
AIM Charter Fund AIM Global Growth & Income Fund mutual-fund monitor.
AIM Global Utilities Fund
INCOME FUNDS
AIM Floating Rate Fund GLOBAL INCOME FUNDS
AIM High Yield Fund AIM Emerging Markets Debt Fund(D)
AIM High Yield Fund II AIM Global Government Income Fund
AIM Income Fund AIM Global Income Fund
AIM Intermediate Government Fund AIM Strategic Income Fund
AIM Limited Maturity Treasury Fund
THEME FUNDS
TAX-FREE INCOME FUNDS AIM Global Consumer Products and Services Fund
AIM High Income Municipal Fund AIM Global Financial Services Fund
AIM Municipal Bond Fund AIM Global Health Care Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Infrastructure Fund
AIM Tax-Free Intermediate Fund AIM Global Resources Fund
AIM Global Telecommunications and Technology Fund(2),(E)
AIM Global Trends Fund(F)
</TABLE>
(1) AIM Aggressive Growth Fund reopened to new investors November 16, 1998. (A)
On September 8, 1998, AIM Mid Cap Growth Fund was renamed AIM Mid Cap Equity
Fund. (B) On September 8, 1998, AIM Small Cap Equity Fund was renamed AIM Small
Cap Growth Fund. (C) On September 8, 1998, AIM America Value Fund was renamed
AIM Basic Value Fund. (D) On September 8, 1998, AIM Global High Income Fund was
renamed AIM Emerging Markets Debt Fund. (E) On June 1, 1999, AIM Global
Telecommunications Fund was renamed AIM Global Telecommunications and Technology
Fund. (F) On September 8, 1998, AIM New Dimension Fund was renamed AIM Global
Trends Fund. For more complete information about any AIM Fund(s), including
sales charges and expenses, ask your financial consultant or securities dealer
for a free prospectus(es).
Please read the prospectus(es) carefully before you invest or send money.
[AIM LOGO APPEARS HERE]
INVEST WITH DISCIPLINE--Registered Trademark--
