<PAGE>
[LOGO]
--------------------------
COLONIAL GLOBAL
NATURAL RESOURCES
FUND
--------------------------
SEMIANNUAL REPORT
APRIL 30, 1996
[Photo in backround]
<PAGE>
COLONIAL GLOBAL NATURAL RESOURCES FUND
HIGHLIGHTS
NOVEMBER 1, 1995 - APRIL 30, 1996
INVESTMENT OBJECTIVE: Colonial Global Natural Resources Fund seeks preservation
of capital, purchasing power and long-term growth.
THE FUND IS DESIGNED TO OFFER:
- Potential preservation of purchasing power and growth
- Diversification to help reduce risk
- Experienced professional management
PORTFOLIO MANAGER COMMENTARY: "Colonial Global Natural Resources Fund continued
to benefit from industry diversification during the reporting period. While
gold, oil and natural gas prices rose during the period, the largest positive
impact for the Fund came from energy and metal stocks."
COLONIAL GLOBAL NATURAL RESOURCES FUND PERFORMANCE
<TABLE>
<CAPTION>
CLASS A CLASS B
<S> <C> <C>
Inception dates 6/8/92 6/8/92
Six-month distributions declared per share $0.671 $0.626
Total returns, assuming
reinvestment of all distributions
and no sales charge or contingent
deferred sales charge (CDSC) --
6 months 19.40% 18.97%
Net asset value per share at 4/30/96 $14.09 $14.03
</TABLE>
<TABLE>
<CAPTION>
TOP FIVE HOLDINGS* TOP FIVE COUNTRIES*
(as of 4/30/96) (as of 4/30/96)
- ------------------------------------- -------------------------------------
<C> <C> <C> <C>
1. Exxon Corp. ........... 2.08% 1. United States 65.8%
2. Triton Energy Corp. ... 1.99% 2. Canada 14.1%
3. Sonat Offshore Drill .. 1.91% 3. Australia 5.0%
4. Oryx Energy Company ... 1.89% 4. United Kingdom 4.1%
5. Pennzoil Co. .......... 1.60% 5. France 2.1%
</TABLE>
* There can be no guarantee the Fund will continue to invest in these companies
or countries in the future. The percentage breakdown by country is based on
total investments.
2
<PAGE>
PRESIDENT'S MESSAGE
TO FUND SHAREHOLDERS
[PHOTO OF PRESIDENT]
I am pleased to present your Fund's semiannual report for the period ended April
30, 1996. First, however, I would like to extend my thanks to President John A.
McNeice, Jr., who has retired after a career with Colonial that spanned 40
years. We look forward to his continued involvement on the executive committee
of the board of directors at our parent company, Liberty Financial Companies,
Inc.
In my new position, I am directing Colonial's focus on the delivery of superior
investment performance over the long term. To achieve this mission, we will
continue to seek the optimal combination of talented people and effective
investment disciplines.
The receipt of your semiannual report is a good time to reflect on market
conditions and the performance of your Fund during the past 6 months. Falling
interest rates and minimal inflation helped the economy grow at a comfortable
pace throughout 1995 and created a positive environment for financial
investments. The stock market received additional impetus from strong growth of
corporate profits.
While there may be some current market volatility, we expect moderate growth and
low inflation to continue and believe that reductions in interest rates may take
place later in the year. Earnings should continue to make progress but at a
slower pace than in 1995. Opportunities are not confined to the U.S., as we
anticipate growth in certain foreign markets. In the following pages you'll find
detailed information on your Fund's performance as well as an in-depth
discussion with the portfolio manager.
With over 12 years of service at Colonial and more than 25 years in the
industry, I am enthusiastic about -- and dedicated to achieving -- Colonial's
mission of providing you with competitive investment returns. In my new role, I
look forward to communicating with you about your Colonial investment. We
appreciate the opportunity to help you meet your investment goals.
Respectfully,
/s/ Harold W. Cogger
- --------------------
Harold W. Cogger
President
June 14, 1996
Because market conditions change frequently, there can be no assurance that the
trends described here will continue, come to pass, or affect Fund performance.
3
<PAGE>
PORTFOLIO MANAGEMENT REPORT
SUSAN CORDES is portfolio manager of Colonial Global Natural Resources Fund and
a vice president of Colonial Management Associates, Inc. She is also co-manager
of Colonial Global Equity Fund. NICOLAS GHAJAR is a research analyst for the
Fund.
Q. SUSAN, PLEASE DESCRIBE THE GLOBAL ECONOMIC ENVIRONMENT DURING THE SIX-MONTH
PERIOD.
S.C. Growth in the leading economic indicators helped push commodity prices
higher, particularly in the energy and precious metals sectors. In the U.S.,
economic data on employment and housing starts was very encouraging. Economic
conditions continued to improve in Japan while Europe also continued to see
positive economic growth. Asia's performance remained robust, with GDP growth in
selected countries in the 5% range during the first four months of 1996.
Q. NICOLAS, HOW DID NATURAL RESOURCES MARKETS PERFORM DURING THE PERIOD?
N.G. Worldwide, the environment for investing in natural resource stocks was
positive during the reporting period. Gold prices, which had traded in a narrow
range for the past two years (between $370 and $390 an ounce) staged a rally
during the first six weeks of 1996. The price rose to $418 at the beginning of
February, a six-year high, although it subsequently declined to $391 by the end
of the period. The long cold winter in North America contributed to higher
prices for natural gas, with U.S. gas inventories reaching 20-year lows. Base
metal prices also rose, driven by a resurgence in international economic
activity.
Q. HOW DID THESE MARKET CONDITIONS AFFECT FUND PERFORMANCE?
S.C. The largest positive impact came from energy and metal stocks, which
accounted for 43% and 18% of the Fund holdings, respectively as of April 30,
1996. Rising oil and gas prices helped holdings such as Triton Energy Corp. and
PanEnergy Corp. The rally in gold prices also helped the Fund's gold-related
stocks, which comprised 10% of the portfolio.
Q. HOW DID THE FUND PERFORM COMPARED TO THE INDEX USED TO EVALUATE ITS
PERFORMANCE?
N.G. For the six-month period ending April 30, 1996, the Fund's Class A shares
returned 19.40%, compared to 13.76% for the Standard & Poor's 500 Index. The S&P
500, which is a common measure of general U.S. stock performance, is largely
dominated by the technology sector. In contrast, the Fund invests only in energy
and natural resource-related stocks, which outperformed technology stocks during
the six-month period.
Q. WHAT IS YOUR MARKET OUTLOOK?
S.C. Looking ahead, we believe that the U.S. economy will continue to
4
<PAGE>
accelerate at a steady but slower pace. We expect foreign economic growth to
continue its strong pace, led by the emerging economies of the Pacific Rim, the
expected Japanese recovery and the pick-up in the European economy. We would
expect these factors to have a positive effect on the earnings of natural
resource-related companies.
COLONIAL GLOBAL NATURAL RESOURCES FUND'S INVESTMENT PERFORMANCE
VS. THE STANDARD & POOR'S 500 INDEX
Change in Value of $10,000 from 6/92 - 4/96
Based on NAV and MOP for Class A Shares
[The following is a line graph]
<TABLE>
<CAPTION>
CGNRF class A NAV MOP S&P
<S> <C> <C> <C>
Jun 30, 92 10000 9425 10000
Jul 31, 92 10268.12 9677.71 10408.19
Aug 31, 92 10039.72 9462.44 10195.57
Sep 30, 92 10009.93 9434.36 10315.42
Oct 31, 92 9682.22 9125.5 10350.83
Nov 30, 92 9285 8751.12 10702.31
Dec 31, 92 9431.81 8889.48 10833.61
Jan 31, 93 9421.8 8880.05 10924.09
Feb 28, 93 9852.34 9285.83 11072.92
Mar 31, 93 10513.17 9908.66 11306.4
Apr 30, 93 11043.83 10408.81 11033.12
May 31, 93 11684.63 11012.77 11327.53
Jun 30, 93 11625.92 10957.43 11360.59
Jul 31, 93 12128.33 11430.96 11314.85
Aug 31, 93 12218.77 11516.19 11743.23
Sep 30, 93 11716.35 11042.66 11653.17
Oct 31, 93 12218.77 11516.19 11894.06
Nov 30, 93 11897.22 11213.13 11780.69
Dec 31, 93 12616.19 11890.76 11923.12
Jan 31, 94 13308.95 12542.83 12328.09
Feb 28, 94 128780.55 12130.49 11993.66
Mar 31, 94 12575.49 11852.4 11471.77
Apr 30, 94 12646.71 11919.53 11618.74
May 31, 94 12941.77 12197.62 11808.67
Jun 30, 94 1270.96 11970.66 11519.7
Jul 31, 94 13058.88 12307.99 11897.7
Aug 31, 94 13427.02 12654.97 12384.37
Sep 30, 94 13416.8 12645.33 12081.77
Oct 31, 94 13457.7 12683.88 12352.81
Nov 30, 94 12394.17 11681.51 11903.5
Dec 31, 94 12499.45 11780.73 12079.73
Jan 31, 95 11849.86 11168.49 12392.78
Feb 28, 95 12237.52 11533.86 12875.27
Mar 31, 95 12729.95 11997.98 13254.59
Apr 30, 95 13149.04 12392.97 13644.6
May 31, 95 13348.11 12580.6 14189.13
Jun 30, 95 13448.87 12675.56 14518.13
Jul 31, 95 13985.14 13181 14999.37
Aug 31, 95 13848.44 13052.16 15036.81
Sep 30, 95 13711.75 12923.32 15671.03
Oct 31, 95 13070.32 12318.78 15615.04
Nov 30, 95 13627.63 12844.04 16299.74
Dec 31, 95 14132.42 13319.8 16613.72
Jan 31, 96 14597.59 13758.23 17178.52
Feb 29, 96 14708.34 13862.62 17338.33
Mar 31, 96 15262.12 14384.55 17505.26
Apr 30, 96 15605.46 14708.15 17763.11
</TABLE>
Based on NAV and Maximum CDSC
for Class B Shares
[The following is a line graph]
<TABLE>
<CAPTION>
class b NAV CDSC S&P
<S> <C> <C> <C>
Jun 30, 92 10000 10000 10000
Jul 31, 92 10268.39 10268.39 10408.19
Aug 31, 92 10029.82 10029.82 10195.57
Sep 30, 92 10000 10000 10315.42
Oct 31, 92 9662.03 9662.03 10350.83
Nov 30, 92 9254.47 9254.47 10702.31
Dec 31, 92 9397.54 9397.54 10833.61
Jan 31, 93 9377.59 9377.59 10924.09
Feb 28, 93 9806.57 9806.57 11072.92
Mar 31 ,93 10464.99 10464.99 11306.4
Apr 30, 93 10973.78 10973.78 11033.12
May 31, 93 11602.27 11602.27 11327.53
Jun 30, 93 11547.88 11547.88 11360.59
Jul 31, 93 12036.95 12036.95 11314.85
Aug 31, 93 12116.79 12116.79 11743.23
Sep 30, 93 11617.75 11617.75 11653.17
Oct 31, 93 12106.81 12106.81 11894.06
Nov 30, 93 11777.44 11777.44 11780.69
Dec 31, 93 12478.89 12478.89 11618.74
Jan 31, 94 13163.77 13163.77 12328.09
Feb 28, 94 12720.62 12620.62 11993.66
Mar 31, 94 12418.46 12418.46 11471.77
Apr 30, 94 12478.89 12478.89 11618.74
May 31, 94 12770.98 12770.98 11808.67
Jun 30, 94 12513.38 12513.38 11519.7
Jul 31, 94 12856.48 12856.48 11897.7
Aug 31, 94 13219.78 13219.78 12384.37
Sep 30, 94 13209.68 13209.68 12081.77
Oct 31, 94 13229.87 13229.87 12352.81
Nov 30, 94 12180.36 12180.36 11903.5
Dec 31, 94 12273.94 12273.94 12079.73
Jan 31, 95 11624.69 11624.69 12392.78
Feb 28, 95 12006 12006 12875.27
Mar 31, 95 12480.05 13254.59 13254.59
Apr 30, 95 12881.97 12881.97 13644.6
May 31, 95 13067.47 13067.47 14189.13
Jun 30, 95 13160.22 13160.22 14518.13
Jul 31, 95 13675.5 13675.5 14999.37
Aug 31, 95 13531.22 13531.22 15036.81
Sep 30, 95 13397.25 13397.25 15671.03
Oct 31, 95 12758.3 12758.3 15615.04
Nov 30, 95 13283.89 13283.89 16299.74
Dec 31, 95 13772.34 13772.34 16613.72
Jan 31, 96 14226.73 14226.73 17178.52
Feb 29, 96 14313.28 14313.28 17338.33
Mar 31, 96 14843.4 14843.4 17505.26
Apr 30, 96 15178.78 14878.78 17763.11
</TABLE>
The Standard & Poor's 500 Index is an unmanaged index that tracks the
performance of the U.S. stock market.
AVERAGE ANNUAL TOTAL RETURN
As of 3/31/96 (Most Recent Quarter End)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------
CLASS A SHARES CLASS B SHARES
INCEPTION 6/8/92 6/8/92
NAV MOP NAV W/CDSC
- ---------------------------------------------------------------------------
<C> <C> <C> <C> <C>
1 YEAR 19.89% 13.00% 18.94% 13.94%
- ---------------------------------------------------------------------------
SINCE INCEPTION 11.92% 10.20% 11.08% 10.49%
- ---------------------------------------------------------------------------
</TABLE>
Past performance cannot predict future results. Return and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. Net asset value (NAV) return does not
include sales charges or CDSC. Maximum offering price (MOP) return includes the
maximum sales charge of 5.75%. The CDSC returns reflect charges of: one year,
5.00%; since inception, 3.00%. Performance for different share classes will vary
based on differences in sales charges and fees associated with each class.
5
<PAGE>
INVESTMENT PORTFOLIO
APRIL 30, 1996 (UNAUDITED, IN THOUSANDS)
<TABLE>
<CAPTION>
COMMON STOCKS-94.6% COUNTRY SHARES VALUE
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
CONSTRUCTION-2.8%
BUILDING CONSTRUCTION-2.1%
Kaufman & Broad Home Corp. 27 $ 374
Lennar Corp. 16 395
Pulte Corp. 20 538
------
1,307
------
HEAVY CONSTRUCTION-NON BUILDING
CONSTRUCTION-0.7%
Koninklijke Boskalis Westminster NV Ne 29 422
------
- ---------------------------------------------------------------------------
MANUFACTURING-43.1%
CHEMICALS & ALLIED PRODUCTS-7.0%
Cabot Corp. 9 249
Dow Chemical Co. 11 969
E.I. DuPont De Nemours & Co., Inc. 10 828
Norsk Hydro AS No 15 703
OM Group, Inc. 9 324
Smith International, Inc. 25 732
Wellman, Inc. 19 456
------
4,261
------
LUMBER & WOOD PRODUCTS-1.9%
Donohue, Class A Ca 25 348
Pacific Forest Products Ltd.(a) Ca 32 415
West Fraser Timber Co. Ltd. Ca 17 383
------
1,146
------
MACHINERY & COMPUTER EQUIPMENT-3.1%
Camco International, Inc. 20 695
NN Ball and Roller, Inc. 19 463
Pentair, Inc. 27 736
------
1,894
------
PAPER PRODUCTS-2.8%
ACX Technologies, Inc.(a) 6 116
Asia Pacific Resources International
Holdings Ltd(a) Id 31 223
Champion International Corp. 9 449
Emin Leydier Fr 2 159
Republic Gypsum Co. 23 312
Stone-Consolidated Corp.(a) Ca 36 467
------
1,726
------
</TABLE>
6
<PAGE>
<TABLE>
Investment Portfolio/April 30, 1996
- -------------------------------------------------------------------------
<S> <C> <C> <C>
PETROLEUM REFINING-15.3%
Amerada Hess Corp. 14 $ 798
Amoco Corp. 8 584
Atlantic Richfield Co. 4 489
British Petroleum Co. PLC ADR UK 8 836
Exxon Corp. 15 1,275
Mobil Corp. 8 943
OMV Handels AG Aus 6 559
Pennzoil Co. 22 978
Quaker State Corp. 40 635
Repsol SA ADS Sp 19 692
Royal Dutch Petroleum Co. Ne 5 645
Shell Canada Ltd. Ca 12 396
Tosco Corp. 7 390
Valero Energy Corp. 5 133
------
9,353
------
PRIMARY METAL-8.5%
AK Steel Holdings Corp. 13 509
Acerinox SA Sp 3 322
Alcan Aluminum Ltd. Ca 22 701
Aluminum Company of America 14 848
Asarco, Inc. 14 467
Broken Hill Proprietary Co. Ltd. Au 43 663
Brush Wellman, Inc. 18 336
Chaparral Steel Co. 40 605
Eramet SLN Fr 7 496
KM Europa Metal AG(a) G 3 239
Preussag Stahl AG G (b) 2
------
5,188
------
PRIMARY SMELTING-1.4%
Capral Aluminum Ltd.(a) Au 73 213
RTZ Corp., ADR UK 10 657
------
870
------
RUBBER & PLASTIC-1.5%
AEP Industries, Inc. 14 347
Hanna (M.A.) Co. 17 583
------
930
------
STONE, CLAY, GLASS & CONCRETE-1.6%
Global Industrial Technologies, Inc.(a) 51 930
Holderbank Financiere Glarus-BR Sz (b) 84
------
1,014
------
</TABLE>
7
<PAGE>
Investment Portfolio/April 30, 1996
<TABLE>
<CAPTION>
COMMON STOCKS - CONT. COUNTRY SHARES VALUE
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
MINING & ENERGY - 38.0%
CRUDE PETROLEUM & NATURAL GAS - 6.1%
Anadarko Petroleum Corp. 13 $ 751
Apache Corp. 11 322
Occidental Petroleum Corp. 35 904
Societe Nationale Elf Acquitaine Fr 7 537
Triton Energy Corp.(a) 22 1,216
------
3,730
------
GOLD & SILVER MINING - 8.1%
American Barrick Resources Corp. Ca 23 701
Ashanti Goldfields Company Ltd. GDS(d) Gb 10 214
Cambior, Inc. Ca 36 499
Gold Mines of Kalgoorlie Ltd. Au 96 112
Newmont Mining Corp. 16 916
Pegasus Gold, Inc. 40 570
Placer Dome, Inc. Ca 26 730
Sons of Gwalia Ltd. Au 126 901
TVX Gold, Inc. Ca 39 312
------
4,955
------
METAL MINING - 6.9%
Acacia Resources Ltd.(a) Au 130 327
Battle Mountain Gold Co. 52 460
Cyprus Amax Minerals Co. 24 654
Freeport-McMoRan Copper & Gold, Inc.
Class A 27 838
Newcrest Mining Ltd. Au 15 74
Noranda, Inc. Ca 30 662
Santa Fe Pacific Gold Corp.(a) 52 770
Stillwater Mining Co.(a) 18 420
------
4,205
------
NONMETALLIC, EXCEPT FUELS - 2.5%
De Beers Consolidated Mines Ltd.(a) SA 16 505
Potash Corp. of Saskatchewan, Inc. Ca 8 536
Vulcan Materials Co. 9 529
------
1,570
------
OIL & GAS EXTRACTION - 13.7%
Alberta Energy Co. Ltd. Ca 31 601
Elan Energy, Inc.(a) Ca 27 269
Energy Service Co., Inc.(a) 16 480
Global Marine, Inc.(a) 73 827
Helmerich & Payne, Inc. 20 749
</TABLE>
8
<PAGE>
Investment Portfolio/April 30, 1996
- -------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Oryx Energy Co. 72 $ 1,157
Parker and Parsley Petroleum Co. 33 808
Petro-Canada Ca 48 613
Pioneer International Ltd. Au 192 583
Pride Petroleum Services, Inc.(a) 25 406
Reading & Bates Corp.(a) 12 282
Sonat Offshore Drilling Co. 21 1,169
Union Texas Petroleum Holdings, Inc. 23 453
-------
8,397
-------
OIL & GAS FIELD SERVICES - 0.7%
Schlumberger Ltd. 5 415
-------
- -------------------------------------------------------------------------------
TRANSPORTATION, COMMUNICATION,
ELECTRIC, GAS & SANITARY SERVICES -
9.7%
COMMUNICATIONS - 0.8%
Inco Ltd. Ca 14 476
-------
ELECTRIC, GAS & SANITARY SERVICES -
2.8%
Hyder PLC UK 27 304
NGL Corp. 38 571
Panhandle Eastern Corp. 27 874
-------
1,749
-------
ELECTRIC SERVICES - 2.1%
Allegheny Power System, Inc. 22 643
EVN Energie-Versorgung
Niederoesterreich AG Aus 4 622
-------
1,265
-------
GAS SERVICES - 3.1%
Aquila Gas Pipeline Corp. 30 416
Eastern Enterprises 7 240
MCN Corp. 4 96
New Jersey Resources Corp. 10 295
Washington Gas & Light Co. 41 855
-------
1,902
-------
SANITARY SERVICES - 0.9%
South West Water PLC UK 52 535
-------
- -------------------------------------------------------------------------------
WHOLESALE TRADE - 1.0%
DURABLE GOODS
Commercial Metals Co. 21 615
-------
TOTAL COMMON STOCKS (cost of $46,604) 57,925
-------
</TABLE>
9
<PAGE>
Investment Portfolio/April 30, 1996
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PREFERRED STOCK - 0.1% COUNTRY SHARES VALUE
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
TRANSPORTATION, COMMUNICATION,
ELECTRIC,GAS & SANITARY
SERVICES-0.1%
ELECTRIC, GAS & SANITARY SERVICES
Hyder PLC, 7.875% (cost of $41) UK 30 $46
---
<CAPTION>
CORPORATE FIXED - INCOME
BONDS & NOTES - 0.1% CURRENCY PAR
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
MANUFACTURING - 0.1%
LUMBER & WOOD PRODUCTS
Donohue, Inc.:
Series A,
8.000% 03/01/97 CD 37 28
Series B,
8.000% 03/01/98 CD 37 27
------
TOTAL CORPORATE FIXED-INCOME
BONDS & NOTES (cost of $55) 55
------
TOTAL INVESTMENTS-94.8%
(cost of $46,700)(c) 58,026
------
<CAPTION>
SHORT-TERM OBLIGATIONS-5.4%
- ----------------------------------------------------------------------------
<S> <C> <C>
Repurchase agreement with Bankers Trust
Securities Corp. dated 4/30/96, due 5/01/96
at 5.320%, collateralized by U.S. Treasury
notes with various maturities to 2001, market
value $3,380 (repurchase proceeds $3,309) 3,309 3,309
------
<CAPTION>
OTHER ASSETS & LIABILITIES, NET-(0.2%) (139)
- -----------------------------------------------------------------------------
<S> <C>
NET ASSETS-100.0% $61,196
-------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
- -----------------------------------------------------------------------------
(a) Non-income producing.
(b) Rounds to less than one.
(c) Cost for federal income tax purposes is the same.
10
<PAGE>
Investment Portfolio/April 30, 1996
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Summary of Securities by Country/
Country/Currency Currency Value % of Total
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
United States $38,188 65.8%
Canada Ca/CD 8,164 14.1%
Australia Au 2,873 5.0%
United Kingdom UK 2,378 4.1%
France Fr 1,192 2.1%
Austria Aus 1,181 2.0%
Netherlands Ne 1,067 1.8%
Spain Sp 1,013 1.7%
Norway No 703 1.2%
South Africa SA 505 0.9%
Germany G 241 0.4%
Indonesia Id 223 0.4%
Ghana Gh 214 0.4%
Switzerland Sz 84 0.1%
------- ------
$58,026 100.0%
</TABLE>
ACRONYM NAME
- ------- ----------------------------------------
ADR American Depository Receipt
ADS American Depository Shares
GDS Global Depository Shares
See notes to financial statements.
11
<PAGE>
STATEMENT OF ASSETS & LIABILITIES
APRIL 30, 1996 (UNAUDITED)
(in thousands except for per share amounts and footnotes)
<TABLE>
<CAPTION>
ASSETS
<S> <C> <C>
Investments at value (cost $46,700) $58,026
Short-term obligations 3,309
-------
61,335
Cash held in foreign banks (cost $11) $ 11
Receivable for:
Fund shares sold 192
Investments sold 140
Dividends 99
Foreign tax reclaims 5
Interest 1
Deferred organization expenses 15
Other 16 479
---- -------
Total Assets 61,814
<CAPTION>
LIABILITIES
<S> <C> <C>
Payable for:
Investments purchased 506
Fund shares repurchased 98
Accrued:
Deferred Trustees fees 2
Other 12
----
Total Liabilities 618
-------
<CAPTION>
<S> <C>
NET ASSETS $61,196
-------
Net asset value & redemption price per share-
Class A ($35,261/2,502) $ 14.09
-------
Maximum offering price per share-Class A
($14.09/0.9425) $ 14.95 (a)
-------
Net asset value & offering price per share-
Class B ($25,985/1,849) $ 14.03 (b)
------
<CAPTION>
COMPOSITION OF NET ASSETS
<S> <C>
Capital paid in $46,866
Overdistributed net investment income (40)
Accumulated net realized gain 3,046
Net unrealized appreciation (depreciation) on:
Investments 11,326
Foreign currency transactions (2)
-------
$61,196
-------
</TABLE>
(a) On sales of $50,000 or more the offering price is reduced.
(b) Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge.
See notes to financial statements.
12
<PAGE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME
Dividends $ 483
Interest 90
-------
Total investment income (net of nonrebatable
foreign taxes withheld at source which
amounted to $25) 573
EXPENSES
Management fee $ 210
Service fee 70
Distribution fee - Class B 86
Transfer agent 95
Bookkeeping fee 15
Registration fee 7
Custodian fee 23
Audit fee 16
Trustees fee 12
Reports to shareholders 8
Legal fee 7
Amortization of deferred
organization expenses 7
Other 1 557
-------- --------
Net Investment Income 16
--------
NET REALIZED & UNREALIZED GAIN (LOSS) ON
PORTFOLIO POSITIONS
Net realized gain (loss) on:
Investments 2,591
Foreign currency transactions (11)
--------
Net Realized Gain 2,580
Net unrealized appreciation (depreciation) during
the period on:
Investments 7,186
Foreign currency transactions (8)
--------
Net Unrealized Appreciation 7,178
--------
Net Gain 9,758
--------
Net Increase in Net Assets from Operations $ 9,774
--------
</TABLE>
See notes to financial statements.
13
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
(Unaudited)
Six months ended Year ended
(in thousands) April 30 October 31
---------------- ----------
INCREASE (DECREASE) IN NET ASSETS 1996 1995
Operations:
Net investment income $ 16 $ 293
Net realized gain 2,580 2,578
Net unrealized appreciation (depreciation) 7,178 (4,704)
--------- ----------
Net Increase (Decrease) from Operations 9,774 (1,833)
Distributions:
From net investment income - Class A (111) (289)
From net realized gains - Class A (1,545) (642)
From net investment income - Class B -- (38)
From net realized gains - Class B (1,041) (424)
---------- ----------
7,077 (3,226)
---------- ----------
Fund Share Transactions:
Receipts for shares sold - Class A 4,215 5,815
Value of distributions reinvested - Class A 1,460 807
Cost of shares repurchased - Class A (5,910) (10,146)
---------- ----------
(235) (3,524)
---------- ----------
Receipts for shares sold - Class B 6,372 7,844
Value of distributions reinvested - Class B 892 413
Cost of shares repurchased - Class B (5,138) (8,567)
---------- ----------
2,126 (310)
---------- ----------
Net Increase (Decrease) from Fund
Share Transactions 1,891 (3,834)
---------- ----------
Total Increase (Decrease) 8,968 (7,060)
NET ASSETS
Beginning of period 52,228 59,288
---------- ----------
End of period (net of overdistributed and
including undistributed net investment
income of $40 and $73, respectively) $ 61,196 $ 52,228
---------- ----------
NUMBER OF FUND SHARES
Sold - Class A 314 463
Issued for distributions reinvested - Class A 116 73
Repurchased - Class A (446) (816)
---------- ----------
(16) (280)
---------- ----------
Sold - Class B 478 635
Issued for distributions reinvested - Class B 71 35
Repurchased - Class B (391) (692)
---------- ----------
158 (22)
---------- ----------
</TABLE>
See notes to financial statements.
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1996 (UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
In the opinion of management of Colonial Global Natural Resources Fund (the
Fund), a series of Colonial Trust III, the accompanying financial statements
contain all normal and recurring adjustments necessary for the fair
presentation of the financial position of the Fund at April 30, 1996, and the
results of its operations, the changes in its net assets and the financial
highlights for the six months then ended.
NOTE 2. ACCOUNTING POLICIES
- -------------------------------------------------------------------------------
ORGANIZATION: The Fund is a non-diversified portfolio of a Massachusetts
business trust registered under the Investment Company Act of 1940, as amended,
as an open-end, management investment company. The Fund's objective is to seek
preservation of capital, purchasing power and long-term growth. The Fund may
issue an unlimited number of shares. The Fund offers Class A shares sold with a
front-end sales charge and Class B shares which are subject to an annual
distribution fee and a contingent deferred sales charge. Class B shares will
convert to Class A shares when they have been outstanding approximately eight
years.
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 revenue and expenses during the reporting period.
Actual results could differ from those estimates. The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of its financial statements.
SECURITY VALUATION AND TRANSACTIONS: Equity securities are valued at the last
sale price or, in the case of unlisted or listed securities for which there
were no sales during the day, at current quoted bid prices.
Debt securities generally are valued by a pricing service based upon market
transactions for normal, institutional-size trading units of similar securities.
When management deems it appropriate, an over-the-counter or exchange bid
quotation is used.
Forward currency contracts are valued based on the weighted value of the
exchange traded contracts with similar durations.
Short-term obligations with a maturity of 60 days or less are valued at
amortized cost.
The value of all assets and liabilities quoted in foreign currencies are
translated into U.S. dollars at that day's exchange rates.
Portfolio positions which cannot be valued as set forth above are valued at
fair value under procedures approved by the Trustees.
15
<PAGE>
Notes to Financial Statements/April 30, 1996
- -------------------------------------------------------------------------------
NOTE 2. ACCOUNTING POLICIES - CONT.
- -------------------------------------------------------------------------------
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
Cost is determined and gains and losses are based upon the specific
identification method for both financial statement and federal income tax
purposes.
DETERMINATION OF CLASS NET ASSET VALUES AND FINANCIAL HIGHLIGHTS: All income,
expenses (other than the Class B distribution fee), realized and unrealized
gains (losses), are allocated to each class proportionately on a daily basis
for purposes of determining the net asset value of each class.
The per share data was calculated using the average shares outstanding during
the period. In addition, Class B net investment income per share data reflects
the distribution fee applicable to Class B shares only.
Class B ratios are calculated by adjusting the expense and net investment income
ratios for the Fund for the entire period by the annualized distribution fee
applicable to Class B shares only.
FEDERAL INCOME TAXES: Consistent with the Fund's policy to qualify as a
regulated investment company and to distribute all of its taxable income, no
federal income tax has been accrued.
INTEREST INCOME, DEBT DISCOUNT AND PREMIUM: Interest income is recorded on the
accrual basis. Original issue discount is accreted to interest income over the
life of a security with a corresponding increase in the cost basis; premium and
market discount are not amortized or accreted.
DEFERRED ORGANIZATION EXPENSES: The Fund incurred expenses of $71,295 in
connection with its organization, initial registration with the Securities and
Exchange Commission and with various states, and the initial public offering of
its shares. These expenses were deferred and are being amortized on a
straight-line basis over five years.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions to shareholders are recorded on
the ex-date.
The amount and character of income and gains to be distributed are determined
in accordance with income tax regulations which may differ from generally
accepted accounting principles. Reclassifications are made to the Fund's
capital accounts to reflect income and gains available for distribution (or
available capital loss carryovers) under income tax regulations.
16
<PAGE>
Notes to Financial Statements/April 30, 1996
- ----------------------------------------------------------------------------
FOREIGN CURRENCY TRANSACTIONS: Net realized and unrealized gains (losses) on
foreign currency transactions includes the fluctuation in exchange rates on
gains (losses) between trade and settlement dates on securities transactions,
gains (losses) arising from the disposition of foreign currency and currency
gains (losses) between the accrual and payment dates on dividends and interest
income and foreign withholding taxes.
The Fund does not distinguish that portion of gains and losses on investments
which is due to changes in foreign exchange rates from that which is due to
changes in market prices of the investments. Such fluctuations are included
with the net realized and unrealized gains (losses) on investments.
FORWARD CURRENCY CONTRACTS: The Fund may enter into forward currency contracts
to purchase or sell foreign currencies at predetermined exchange rates in
connection with the settlement of purchases and sales of securities. The Fund
may also enter into forward currency contracts to hedge certain other foreign
currency denominated assets. The contracts are used to minimize the exposure
to foreign exchange rate fluctuations during the period between trade and
settlement date of the contracts. All contracts are marked-to-market daily,
resulting in unrealized gains or losses which become realized at the time the
forward currency contracts are closed or mature. Realized and unrealized gains
(losses) arising from such transactions are included in net realized and
unrealized gains (losses) on foreign currency transactions. Forward currency
contracts do not eliminate fluctuations in the prices of the Fund's portfolio
securities. While the maximum potential loss from such contracts is the
aggregate face value in U.S. dollars at the time the contract was opened,
exposure is typically limited to the change in value of the contract (in U.S.
dollars) over the period it remains open. Risks may also arise if counter-
parties fail to perform their obligations under the contracts.
OTHER: Corporate actions are recorded on ex-date (except for certain foreign
securities which are recorded as soon after ex-date as the Fund becomes
aware of such), net of nonrebatable tax withholdings. Where a high level of
uncertainty as to collection exists, income on securities is recorded net
of all tax withholdings with any rebates recorded when received.
The Fund's custodian takes possession through the federal book-entry system
of securities collateralizing repurchase agreements. Collateral is marked-
to-market daily to ensure that the market value of the underlying assets
remains sufficient to protect the Fund. The Fund may experience costs and
delays in liquidating the collateral if the issuer defaults or enters
bankruptcy.
17
<PAGE>
Notes to Financial Statements/April 30, 1996
- -------------------------------------------------------------------------------
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
- -------------------------------------------------------------------------------
MANAGEMENT FEE: Colonial Management Associates, Inc. (the Adviser) is the
investment Adviser of the Fund and furnishes accounting and other services
and office facilities for a monthly fee equal to 0.75% annually of the
Fund's average net assets.
BOOKKEEPING FEE: The Adviser provides bookkeeping and pricing services for
$27,000 per year plus 0.035% of the Fund's average net assets over $50
million.
TRANSFER AGENT: Colonial Investors Service Center, Inc. (the Transfer Agent),
an affiliate of the Adviser, provides shareholder services and receives a
monthly fee equal to 0.25% annually of the Fund's average net assets and
receives a reimbursement for certain out of pocket expenses.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES: Colonial Investment
Services, Inc. (the Distributor), an affiliate of the Adviser, is the Fund's
principal underwriter. For the six months ended April 30, 1996, the Fund has
been advised that the Distributor retained net underwriting discounts of
$8,363 on sales of the Fund's Class A shares and received contingent deferred
sales charges (CDSC) of $46,309 on Class B share redemptions.
The Fund has adopted a 12b-1 plan which requires the payment of a service fee
to the Distributor equal to 0.25% annually of the Fund's net assets as of the
20th of each month. The plan also requires the payment of a distribution fee
to the Distributor equal to 0.75% of the average net assets attributable to
Class B shares only.
The CDSC and the fees received from the 12b-1 plan are used principally as
repayment to the Distributor for amounts paid by the Distributor to dealers
who sold such shares.
OTHER: The Fund pays no compensation to its officers, all of whom are employees
of the Adviser.
The Fund's Trustees may participate in a deferred compensation plan which may
be terminated at any time. Obligations of the plan will be paid solely out of
the Fund's assets.
NOTE 4. PORTFOLIO INFORMATION
- ------------------------------------------------------------------------------
INVESTMENT ACTIVITY: During the six months ended April 30, 1996, purchases
and sales of investments, other than short-term obligations, were $19,611,409
and $20,671,217, respectively.
18
<PAGE>
Notes to Financial Statements/April 30, 1996
- ------------------------------------------------------------------------------
Unrealized appreciation (depreciation) at April 30, 1996, based on cost of
investments for both financial statement and federal income tax purposes
was:
Gross unrealized appreciation $12,155,813
Gross unrealized depreciation (829,816)
-------------
Net unrealized appreciation $11,325,997
-------------
OTHER: There are certain additional risks involved when investing in foreign
securities that are not inherent with investments in domestic securities.
These risks may involve foreign currency exchange rate fluctuations, adverse
political and economic developments and the possible prevention of foreign
currency exchange or the imposition of other foreign governmental laws or
restrictions.
The Fund may focus its investments in certain industries, subjecting it to
greater risk than a fund that is more diversified.
NOTE 5. LINE OF CREDIT
- -------------------------------------------------------------------------------
The Fund may borrow up to 10% of its net assets under a line of credit for
temporary or emergency purposes. Any borrowings bear interest at one of the
following options determined at the inception of the loan: (1) federal funds
rate plus 1/2 of 1%, (2) the lending bank's base rate or (3) IBOR offshore
loan rate plus 1/2 of 1%. There were no borrowings under the line of credit
during the six months ended April 30, 1996.
19
<PAGE>
FINANCIAL HIGHLIGHTS (a)
Selected data for a share of each class outstanding throughout each period
are as follows:
<TABLE>
<CAPTION>
(unaudited)
Six months ended Year ended
April 30 October 31
---------------------------------- -------------------------------
1996 1995
Class A Class B Class A Class B
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net asset value -
Beginning of period $ 12.430 $ 12.380 $ 13.160 $ 13.110
=========== =========== =========== ===========
INCOME FROM
INVESTMENT OPERATIONS:
Net investment income 0.024 (0.025) 0.102 0.009
Net realized and
unrealized gain (loss) 2.307 2.301 (0.496) (0.489)
----------- ----------- ----------- -----------
Total from Investment
Operations 2.331 2.276 (0.394) (0.480)
----------- ----------- ----------- -----------
LESS DISTRIBUTIONS
DECLARED TO SHAREHOLDERS:
From net
investment income (0.045) -- (0.106) (0.020)
From net
realized gains (0.626) (0.626) (0.230) (0.230)
----------- ----------- ----------- -----------
Total Distributions Declared
to Shareholders (0.671) (0.626) (0.336) (0.250)
----------- ----------- ----------- -----------
Net asset value -
End of period $ 14.090 $ 14.030 $ 12.430 $ 12.380
=========== =========== =========== ===========
Total return (c) 19.40%(d) 18.97%(d) (2.88)% (3.56)%
=========== =========== =========== ===========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.68%(e)(f) 2.43%(e)(f) 1.66%(f) 2.41% (f)
Net investment income 0.36%(e)(f) (0.39)%(e)(f) 0.82%(f) 0.07% (f)
Portfolio turnover 74%(e) 74%(e) 65% 65%
Average
commission rate (g) $ 0.025 $ 0.025 -- --
=========== =========== =========== ===========
Net assets at end
of period (000) $ 35,261 $ 25,935 $ 31,297 $ 20,931
</TABLE>
(a) Per share data was calculated using average shares outstanding during the
period.
(b) The Fund commenced investment operations on June 8, 1992.
(c) Total return at net asset value assuming all distributions reinvested and no
initial sales charge or contingent deferred sales charge.
(d) Not annualized.
(e) Annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact. Prior years' ratios are net of benefits
received, if any.
(g) For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for trades on which
commissions are charged.
20
<PAGE>
FINANCIAL HIGHLIGHTS (a) - continued
<TABLE>
<CAPTION>
Period ended
Year ended October 31 October 31
- ---------------------------------------------------------------------- ---------------------------------
1994 1993 1992 (b)
Class A Class B Class A Class B Class A Class B
- ----------- ----------- ----------- ---------- ----------- ----------
<C> <C> <C> <C> <C> <C>
$ 12.160 $ 12.130 $ 9.750 $ 9.720 $ 10.000 $ 10.000
=========== =========== =========== =========== ============ ==========
0.114 0.019 0.099 0.018 0.042 0.012
1.104 1.097 2.429 2.431 (0.292) (0.292)
- ----------- ----------- ----------- ---------- ----------- ----------
1.218 1.116 2.528 2.449 (0.250) (0.280)
- ----------- ----------- ----------- ---------- ----------- ----------
(0.118) (0.036) (0.118) (0.039) -- --
(0.100) (0.100) -- -- -- --
- ----------- ----------- ----------- ---------- ----------- ----------
(0.218) (0.136) (0.118) (0.039) -- --
- ----------- ----------- ----------- ---------- ----------- ----------
$ 13.160 $ 13.110 $ 12.160 $ 12.130 $ 9.750 $ 9.720
=========== =========== =========== =========== ============ ==========
10.14% 9.28% 26.20% 25.30% (2.50)%(d)% (2.80)%(d)%
=========== =========== =========== =========== ============ ==========
1.70% 2.45% 1.88% 2.63% 2.45%(e) 3.20%(e)
0.90% 0.15% 0.92% 0.17% 1.07%(e) 0.32%(e)
15% 15% 14% 14% 89%(e) 89%(e)
-- -- -- -- -- --
=========== =========== =========== =========== ============ ==========
$ 36,830 $ 22,458 $ 31,098 $ 7,179 $ 27,790 $ 4,444
</TABLE>
21
<PAGE>
SHAREHOLDER SERVICES
TO MAKE INVESTING EASIER
Colonial has one of the most extensive selections of shareholder services
available. Your financial adviser can help you arrange for any of these
services, or you can call Colonial directly at 1-800-345-6611.
AFFORDABLE ADDITIONAL INVESTMENTS: Add to your account with as little as $50;
$25 for an IRA account.
FREE EXCHANGES*: Exchange all or part of your account into the same share class
of another Colonial fund, by phone or mail, as your needs change over time.
EASY ACCESS TO YOUR MONEY*: Make withdrawals from your account by phone, by mail
or, for certain funds, by check.
ONE-YEAR REINSTATEMENT PRIVILEGE: If you need access to your money, but then
choose to return it to Colonial within one year, you can reinvest in any
Colonial fund of the same share class without any penalty or sales charge.
FUNDAMATIC: Make periodic investments as low as $50 from your checking account
to your Colonial account.
SYSTEMATIC WITHDRAWAL PLAN (SWP): Receive monthly, quarterly, or semiannual
payments via check or bank transmission. There is a $5,000 account value
required, but no minimum for the payment amount. The maximum annual withdrawal
is 12% of account balance at time SWP is established. SWPs by check are
processed on the 10th of each month.
AUTOMATED DOLLAR COST AVERAGING: Transfer money on a monthly basis from any
Colonial fund with a balance of $5,000 into the same share class of up to four
other Colonial funds. Minimum for each transfer is $100.
LOW COST IRAS: Choose from a broad range of retirement plans, including IRAs.
* Redemptions and exchanges are made at the next determined net asset value
after the request is received by Colonial. Proceeds may be more or less than
your original cost. The exchange privilege may be terminated at any time.
Investors who purchase Class B or Class D shares (for applicable funds), or $1
million or more of Class A shares, may be subject to a contingent deferred sales
charge.
22
<PAGE>
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Colonial Global Natural Resources Fund is:
Colonial Investors Service Center, Inc.
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Colonial Global Natural Resources Fund mails one shareholder report to each
shareholder address. If you would like more than one report, please call our
Literature Department at 1-800-248-2828 and additional reports will be sent to
you.
This report has been prepared for shareholders of Colonial Global Natural
Resources Fund. This report may also be used as sales literature when preceded
or accompanied by the current prospectus which provides details of sales
charges, investment objectives and operating policies of the Fund.
23
<PAGE>
[COLONIAL LOGO]
Mutual Funds for
Planned Portfolios
TRUSTEES
ROBERT J. BIRNBAUM
Trustee (formerly Special Counsel, Dechert, Price & Rhoads; President and Chief
Operating Officer, New York Stock Exchange, Inc.)
TOM BLEASDALE
Trustee (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
LORA S. COLLINS
Attorney, Kramer, Levin, Naftalis, Nessen, Kamin & Frankel
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President-Operations, The Rockport
Company)
WILLIAM D. IRELAND, JR.
Trustee (formerly Chairman of the Board, Bank of New England-Worcester)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive Officer, U.S. Plywood
Corporation)
WILLIAM E. MAYER
Dean, College of Business and Management, University of Maryland (formerly Dean,
Simon Graduate School of Business, University of Rochester; Chairman and Chief
Executive Officer, C.S. First Boston Merchant Bank; and President and Chief
Executive Officer, The First Boston Corporation)
JAMES L. MOODY, JR.
Chairman of the Board, Hannaford Bros. Co. (formerly Chief Executive Officer,
Hannaford Bros. Co.)
JOHN J. NEUHAUSER
Dean, Boston College School of Management
GEORGE L. SHINN
Financial Consultant (formerly Chairman, Chief Executive Officer and Consultant,
The First Boston Corporation)
ROBERT L. SULLIVAN
Management Consultant (formerly Management Consultant, Saatchi and Saatchi
Consulting Ltd. and Principal and International Practice Director, Management
Consulting, Peat Marwick Main & Co.)
SINCLAIR WEEKS, JR.
Chairman of the Board, Reed & Barton Corporation
-----------------------------------
NOT FDIC- MAY LOSE VALUE
INSURED NO BANK GUARANTEE
-----------------------------------
Colonial Investment Services, Inc., Distributor (C) 1996
One Financial Center, Boston, Massachusetts 02111-2621, 617-426-3750
NR-03/248C-0496 M (6/96)
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