COLONIAL SELECT VALUE FUND Semiannual report
April 30, 1999
- -----------------------------
Not FDIC May Lose Value
Insured No Bank Guarantee
- -----------------------------
<PAGE>
COLONIAL SELECT VALUE FUND HIGHLIGHTS
NOVEMBER 1, 1998 - APRIL 30, 1999
Investment Objective: Colonial Select Value Fund seeks long-term growth by
investing primarily in middle-capitalization equities.
Portfolio Manager Commentary: "The select group of large-cap stocks which
continued to lead the market during the six-month period affected the Fund's
overall performance. However, the prospects for mid-cap stocks improved in the
first quarter of 1999, as expectations for strong economic growth caused
investors to shift their attention to more value-oriented stocks."
-- James Haynie & Michael Rega
Colonial Select Value Fund Performance
<TABLE>
<CAPTION>
Class A Class B Class C Class Z
Inception dates 1949 6/8/92 8/1/97 1/11/99
<S> <C> <C> <C> <C>
Six-month distributions declared per share $0.72 $0.72 $0.72 --
Six-month total returns, assuming 11.35% 10.97% 10.98% 11.40%(1)
reinvestment of all distributions
and no sales charge or contingent
deferred sales charge (CDSC)
Net asset value per share on 4/30/99 $21.71 $20.97 $21.45 $21.72
</TABLE>
<TABLE>
<CAPTION>
Top Five Holdings(2) Top Five Sectors(2,3)
(as of 4/30/99) (as of 4/30/99)
<S> <C> <C> <C>
1. Comverse Technology, Inc. .... 2.2% 1. Consumer Cyclicals .......... 20.2%
2. Fred Meyer, Inc. ............. 2.1% 2. Technology .................. 19.8%
3. Omnicom Group, Inc. .......... 1.8% 3. Financial ................... 16.6%
4. CNF Transportation ........... 1.6% 4. Utilities ................... 9.6%
5. Applied Micro Circuits Corp. . 1.5% 5. Consumer Staples ............ 7.8%
</TABLE>
(1) Please refer to page 5 for an explanation of how performance is calculated
for the period prior to the inception of Class Z shares.
(2) Holding breakdowns are calculated as a percentage of total net assets.
(3) Sector breakdowns are calculated as a percentage of equity investments.
Industry sectors in the following financial statements are based upon the
standard industrial classifications (SIC) published by the U.S. Office of
Management and Budget. The sector classifications used on this page are
based upon Colonial's defined criteria as used in the investment process.
Because the Fund is actively managed, there can be no guarantee the Fund
will continue to hold these securities or invest in these sectors in the
future.
2
<PAGE>
PRESIDENT'S MESSAGE
TO FUND SHAREHOLDERS
The six-month period ended April 30, 1999 was characterized by improving global
economic conditions and continued strength in the U.S. economy. During the
period, the Dow Jones Industrial Average raced past the 11,000 milestone only a
few weeks after reaching 10,000. Domestic economic activity remained strong.
Retail sales surpassed expectations, the housing market was vibrant, consumer
demand was high and job growth was strong.
In the first three months of the period, the market's gains continued to be
driven by a small number of large-cap growth stocks. However, by the end of the
period, investors began shifting assets into stocks of value-oriented,
economically sensitive sectors, such as energy, basic materials and
manufacturing. As commodity prices rose, particularly those of oil, activity in
many of the U.S. cyclical industries and in emerging markets dependent on oil
exports also picked up.
The following report will provide you with more specific information about your
Fund's performance and the companies in which it invests. As always, we thank
you for choosing Colonial Select Value Fund and for the opportunity to serve
your investment needs.
Respectfully,
/s/ Stephen E. Gibson
- ---------------------
Stephen E. Gibson
President
July 15, 1999
Because economic and market conditions may change frequently, there can be no
assurance that the trends described above or on the following pages will
continue.
3
<PAGE>
PORTFOLIO MANAGEMENT REPORT
James Haynie and Michael Rega co-manage Colonial Select Value Fund and are vice
presidents of Colonial Management Associates, Inc. The following is a
discussion of the Fund's performance for the six-month period ended April 30,
1999.
Mid-caps gain market share
In the latter months of 1998, the market's leadership continued to be
concentrated in a narrow list of high-priced, large-cap growth stocks--many of
which were technology related. This momentum continued into early 1999, but
eventually began to include a broader range of growth stocks, including some in
the mid-cap sector.
By the end of March, there was a significant change in investor sentiment. The
Dow climbed past the 10,000-point milestone on the strength of a broad range of
industries, including energy, retail and financial services. In April, the
market's upward movement included, for the first time in several years,
value-oriented stocks in more cyclical industries such as oil, paper and
metals.
Internet-dominated environment challenged Fund
During the period, a limited number of Internet companies heavily influenced the
performance of the S&P 400 Index, which had a total return of 18.86%. In the
short term, Internet fever hurt the Fund's performance, as a small number of
Internet companies distorted the indexes. For the period ended April 30, 1999,
the Fund's Class A shares generated a total return of 11.35% at net asset value.
We maintained our investment discipline of selecting quality companies at
attractive valuation levels with potential for strong earnings growth. Although
Internet stocks took center stage, we rejected many of them as untested and
overpriced, and opted to invest in more fundamentally sound companies. In
particular, we focused on companies that support the Internet infrastructure,
and therefore, benefit from the industry's growth. For example, Sun Microsystems
(0.3% of total net assets) was a strong performer during the period. Sun
Microsystems provides systems and software that support the Internet. Its
innovation and commitment to research and development have helped it become an
industry leader.
The Fund is designed to maintain broad diversification across many industry
sectors and stock holdings. Currently, no individual stock holding represents
more than 2.5% of the portfolio's total net assets. We believe this management
strategy benefits shareholders over the long term. However, it can detract from
the Fund's performance in a narrow market dominated by a small number of stocks
or a specific sector.
4
<PAGE>
Market trend towards value orientation is encouraging
The shift towards stocks of more cyclical industries late in the period bodes
well for the Fund, and we believe the portfolio should benefit if this trend
continues. Based on our value-oriented strategy, we have become increasingly
optimistic about a number of holdings. One example is Maytag Corporation (1.4%
of net assets), a well-known company that manufactures, distributes and services
a broad line of home appliances. Another example is Ingersoll-Rand Co. (1.2% of
net assets), a multinational company that manufactures non-electrical industrial
machinery and equipment. Both companies maintain leadership positions in their
respective industries, and we believe each offer the potential for strong
earnings growth should the market continue to favor cyclicals. Strong retail
sales also benefited the Fund during the period. One stock that performed well
is Costco Companies (1.3% of net assets), a leading wholesale club chain that
sells consumer merchandise at relatively low prices. As the concept of one-stop
bulk shopping becomes even more attractive to consumers, we believe Costco will
benefit.
Positive outlook for mid-cap stocks
We remain optimistic about the possibility of a worldwide rise in economic
growth in the coming months. We believe expectations of increased growth and a
stronger value orientation in the U.S. market could prove beneficial,
particularly if investor sentiment continues to include mid-cap stocks. Should
earnings and profits continue to strengthen, stocks of more cyclical companies
may benefit. As always, we will continue to seek attractively valued stocks
offering strong growth potential while positioning the Fund to take advantage of
opportunities that lie ahead.
Average Annual Total Returns
As of 4/30/99
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Class A Class B Class C Class Z
NAV POP NAV w/CDSC NAV w/CDSC NAV
1949 6/8/92 8/1/97 1/11/99
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 year (1.50)% (7.16)% (2.22)% (6.94)% (2.17)% (3.12)% (1.45)%
- --------------------------------------------------------------------------------
5 years 19.80 18.39 18.90 18.69 19.52 19.52 19.81
- --------------------------------------------------------------------------------
10 years 15.05 14.37 14.46 14.46 14.92 14.92 15.05
- --------------------------------------------------------------------------------
</TABLE>
Past performance cannot predict future results. Returns and value of an
investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. NAV returns do not include sales charges
or contingent deferred sales charge (CDSC). Public offering price (POP) returns
include the maximum sales charge of 5.75% for Class A shares. CDSC returns
reflect charges of 5% for one year and 2% for five years for Class B shares, and
1% for one year for Class C shares. Performance for different share classes will
vary based on differences in sales charges and fees associated with each class.
Class B, C and Z share (newer class shares) performance includes returns of the
Fund's Class A shares (the oldest existing fund class) for periods prior to the
inception dates of newer class shares. These Class A share returns are not
restated to reflect any expense differential (e.g. Rule 12b-1 fees) between
Class A shares and the newer classes. Had the expense differential been
reflected, the returns for periods prior to the inception date of Class B and C
shares would have been lower.
5
<PAGE>
SHAREHOLDER SERVICES
TO MAKE INVESTING EASIER
Your Fund has one of the most extensive selections of shareholder services
available. Your financial advisor can help you arrange for any of these
services, or you can call Liberty Funds Services, Inc. directly at
1-800-345-6611.
Affordable Additional Investments: Add to your account with as little as $50 on
most funds; $25 for an IRA account.
Free Exchanges(1): Exchange all or part of your account into the same share
class of another fund distributed by Liberty Funds Distributor, Inc. by phone or
mail.
Easy Access to Your Money(1): 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 within one year, you can reinvest in any fund distributed by
Liberty Funds Distributor 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 Fund 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 calendar day of each month unless the 10th falls on a
non-business day or the first business day of the week. If this occurs, the
processing date will be the previous business day. Dividends and capital gains
must be reinvested.
Automated Dollar Cost Averaging: Transfer money on a monthly basis from any fund
with a balance of $5,000 into the same share class of up to four other funds
distributed by Liberty Funds Distributor. Minimum for each transfer is $100.
Retirement Plans: Choose from a broad range of retirement plans, including IRAs.
(1) Redemptions and exchanges are made at the next determined net asset value
after the request is received by the Transfer Agent. Proceeds may be more or
less than your original cost. The exchange privilege may be terminated at
any time. Exchanges are not available on all funds. Investors who purchase
Class B or C shares, or $1 million or more of Class A shares, may be subject
to a contingent deferred sales charge.
6
<PAGE>
INVESTMENT PORTFOLIO
APRIL 30, 1999 (UNAUDITED, IN THOUSANDS)
<TABLE>
<CAPTION>
COMMON STOCKS - 96.7% SHARES VALUE
- -----------------------------------------------------------------------------
CONSTRUCTION - 0.8%
<S> <C> <C>
Building Construction
Centex Corp. 174 $ 6,362
------------
- -----------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 16.7%
Depository Institutions - 9.3%
AmSouth Bancorporation 101 4,808
Associated Banc-Corp. 115 4,183
City National Corp. 208 8,026
Community First Bankshares, Inc. 163 3,331
Cullen/Frost Bankers, Inc. 35 1,866
Dime Bancorp, Inc. 229 5,277
First Tennessee National Corp. 91 3,929
Golden State Bancorp, Inc. (a) 62 1,513
Greenpoint Financial Corp. 236 8,274
Hibernia Corp. 407 5,416
Northern Trust Corp. 83 7,729
North Fork Bancorporation, Inc. 282 6,354
Pacific Century Financial Corp. 27 585
Peoples Heritage Financial Group, Inc. 171 3,315
Unionbancal Corp. 103 3,505
Zions Bancorporation 47 3,121
------------
71,232
------------
Insurance Carriers - 4.2%
Ambac Financial Group, Inc. 126 7,607
American Financial Group, Inc. 15 541
Fremont General Corp. 151 3,016
Hartford Life, Inc., Class A 72 3,761
Loews Corp. 12 893
MGIC Investment Corp. 70 3,380
Orion Capital Corp. 5 150
PacifiCare Health Systems, Inc., Class B 44 3,518
Protective Life Corp. 47 1,826
The Commerce Group, Inc. 135 3,062
The First American Financial Corp. 142 2,537
Trigon Healthcare, Inc. 58 1,838
------------
32,129
------------
Nondepository Credit Institutions - 1.4%
Capital One Financial Corp. 34 5,905
Countrywide Credit Industries, Inc. 109 4,944
------------
10,849
------------
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
COMMON STOCKS - CONT. SHARES VALUE
-----------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - CONT.
<S> <C> <C>
Security Brokers & Dealers - 1.8%
A.G. Edwards, Inc. 79 $ 2,768
Bear Stearns Companies, Inc. 68 3,182
Franklin Resources, Inc. 46 1,824
Lehman Brothers Holdings, Inc. 115 6,379
------------
14,153
------------
-----------------------------------------------------------------------------
MANUFACTURING - 38.2%
Apparel - 2.0%
Jones Apparel Group, Inc. (a) 206 6,791
Tommy Hilfiger Corp. (a) 92 6,408
VF Corp. 45 2,317
------------
15,516
------------
Chemicals & Allied Products - 4.0%
Allergan, Inc. 59 5,303
Dura Pharmaceuticals, Inc. (a) 133 1,596
Ecolab, Inc. 41 1,736
Goodrich (B.F.) Co. 168 6,658
IMC Global, Inc. 97 2,413
IVAX Corp. 106 1,390
International Specialty Products, Inc. (a) 220 1,815
NBTY, Inc. (a) 34 172
Watson Pharmaceuticals, Inc. (a) 170 6,893
W.R. Grace & Co. 189 3,012
------------
30,988
------------
Communications Equipment - 3.8%
Altera Corp. 142 10,259
Comverse Technology, Inc. (a) 263 16,833
Harman International Industries, Inc. 50 2,306
------------
29,398
------------
Electronic & Electrical Equipment - 2.0%
Applied Micro Circuits Corp. 211 11,249
Qualcomm, Inc. 20 4,000
------------
15,249
------------
Electronic Components - 4.6%
Dallas Semiconductor Corp. 34 1,449
Linear Technology Corp. 166 9,441
Maxin Integrated Products, Inc. 177 9,912
Vitesse Semiconductor Corp. 134 6,206
Xilinx, Inc. 188 8,578
------------
35,586
------------
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
<S> <C> <C>
Fabricated Metals - 0.8%
Crane Co. 199 $ 5,764
------------
Food & Kindred Products - 2.4%
Flowers Industries, Inc. 137 2,911
IBP, Inc. 73 1,482
Interstate Bakeries Corp. 303 6,738
The McClatchy Co. 102 3,659
Tyson Foods, Inc. 155 3,207
------------
17,997
------------
Furniture & Fixtures - 2.2%
Furniture Brands International, Inc. (a) 187 4,687
Herman Miller, Inc. 512 10,200
Leggett & Platt, Inc. 88 2,025
------------
16,912
------------
Household Appliances - 1.4%
Maytag Corp. 160 10,940
------------
Lumber & Wood Products - 0.4%
Clayton Homes, Inc. 154 1,713
Oakwood Homes Corp. 117 1,628
------------
3,341
------------
Machinery & Computer Equipment - 5.2%
Apple Computer, Inc. 87 4,002
Diebold, Inc. 105 2,516
El Paso Energy Corp. 85 3,105
Flowserve Corp. 112 2,086
Ingersoll Rand Co. 137 9,479
Lexmark International Group, Inc. 31 3,828
Sun Microsystems, Inc. (a) 43 2,572
Unisys Corp. (a) 250 7,859
Varco International, Inc. (a) 225 2,545
York International Corp. 48 1,964
------------
39,956
------------
Measuring & Analyzing Instruments - 0.9%
Biomet, Inc. 160 6,556
------------
Paper Products - 1.0%
Fort James Corp. 195 7,410
------------
Petroleum Refining - 0.9%
Amerada Hess Corp. 62 3,534
Kerr-McGee Corp. 73 3,102
------------
6,636
------------
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
COMMON STOCKS - CONT. SHARES VALUE
-----------------------------------------------------------------------------
<S> <C> <C>
MANUFACTURING - CONT.
Primary Metals - 2.0%
Mueller Industries, Inc. 148 $ 4,662
Reynolds Metals Co. 57 3,555
Texas Industries, Inc. 134 4,125
USX-US Steel Group 96 2,898
------------
15,240
------------
Printing & Publishing - 0.5%
New York Times Co. 107 3,674
------------
Rubber & Plastic - 0.2%
Premark International, Inc. 4
Wynn's International, Inc. 96 1,605
------------
1,609
------------
Stone, Clay, Glass & Concrete - 0.9%
Lafarge Corp. 78 2,637
USG Corp. 77 4,466
------------
7,103
------------
Textile Mill Products - 0.5%
Mohawk Industries, Inc. 114 3,677
------------
Transportation Equipment - 2.5%
Cordant Technologies, Inc. 57 2,615
Fleetwood Enterprises, Inc. 83 2,049
Harley-Davidson, Inc. 74 4,412
Meritor Automotive, Inc. 61 1,288
Navistar International Corp. 120 6,278
Varlen Corp. 78 2,179
------------
18,821
------------
-----------------------------------------------------------------------------
MINING & ENERGY - 2.8%
Nonmetallic, Except Fuels - 0.2%
Vulcan Materials Co. 29 1,404
------------
Oil & Gas Extraction - 1.7%
Noble Drilling Corp. (a) 156 3,065
SEACOR SMIT, Inc. (a) 111 5,881
Sonat Offshore Drilling Co. 139 4,121
------------
13,067
------------
Oil & Gas Field Services - 0.9%
BJ Services Co. (a) 92 2,453
Diamond Offshore Drilling, Inc. 130 4,298
------------
6,751
------------
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
<S> <C> <C>
RETAIL TRADE - 10.5%
Apparel & Accessory Stores - 2.0%
Abercrombie & Fitch Co., Class A 39 $ 3,691
Ross Stores, Inc. 160 7,364
TJX Companies, Inc. 130 4,317
------------
15,372
------------
Food Stores - 0.6%
Kroger Corp. (a) 78 4,215
------------
General Merchandise Stores - 4.6%
Costco Companies, Inc. (a) 125 10,101
Federated Department Stores, Inc. (a) 119 5,551
Meyer (Fred), Inc. (a) 302 16,324
Saks, Inc. (a) 114 3,234
------------
35,210
------------
Home Furnishings & Equipment - 1.4%
Best Buy Co., Inc. 156 7,449
CompUSA, Inc. (a) 435 3,045
------------
10,494
------------
Miscellaneous Retail - 1.1%
Office Depot, Inc. (a) 265 5,821
Omnicare, Inc. 114 2,743
------------
8,564
------------
Restaurants - 0.8%
Brinker International, Inc. (a) 212 5,857
------------
-----------------------------------------------------------------------------
SERVICES - 14.5%
Auto Repair, Rental & Parking - 0.7%
Hertz Corp., Class A 87 5,193
------------
Business Services - 2.6%
Ogden Corp. 152 3,929
Omnicom Group, Inc. 189 13,703
Robert Half International, Inc. (a) 83 1,974
------------
19,606
------------
Computer Related Services - 3.0%
Convergys Corp. 167 3,110
Deluxe Corp. 100 3,463
Siebel Systems, Inc. 75 2,883
Shared Medical Systems Corp. 52 2,824
Teradyne, Inc. 187 8,805
Wang Laboratories, Inc. (a) 85 2,133
------------
23,218
------------
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
COMMON STOCKS - CONT. SHARES VALUE
-----------------------------------------------------------------------------
<S> <C> <C>
SERVICES - CONT.
Computer Software - 3.3%
Citrix Systems, Inc. (a) 230 $ 9,775
Compuware Corp. (a) 379 9,243
J.D. Edwards & Co. (a) 60 806
Keane, Inc. (a) 77 1,906
Sterling Software, Inc. (a) 165 3,422
------------
25,152
------------
Educational Services - 0.3%
Apollo Group, Inc., Class A 104 2,574
------------
Engineering, Accounting, Research & Management - 1.1%
ACNielsen Corp. 114 3,178
Paychex, Inc. 101 5,181
------------
8,359
------------
Health Services - 3.5%
Lincare Holdings, Inc. (a) 321 9,521
Total Renal Care Holdings, Inc. (a) 505 7,007
Universal Health Services, Inc., Class B (a) 199 10,306
------------
26,834
------------
-----------------------------------------------------------------------------
TRANSPORTATION, COMMUNICATIONS, ELECTRIC,
GAS & SANITARY SERVICES - 12.7%
Air Transportation - 0.4%
Comair Holdings, Inc. 152 3,342
------------
Communications - 0.4%
NCR Corp. 80 3,280
------------
Electric, Gas & Sanitary Services - 0.9%
Dynegy, Inc. 46 803
Oklahoma Gas & Electric Co. 111 2,629
Sempra Energy 163 3,382
------------
6,814
------------
Electric Services - 7.0%
Central & South West Corp. 110 2,729
Citizens Utilities Co. 143 1,434
Dominion Resources, Inc. 130 5,346
Energy East Corp. 225 5,938
Florida Progress Corp. 80 3,091
LG&E Energy Corp. 143 3,113
MidAmerican Energy Co. 177 5,707
Minnesota Power & Light Co. 312 6,571
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
<S> <C> <C>
Northeast Utilities 242 $ 3,866
Pinnacle West Capital Corp. 152 5,911
Puget Sound Power & Light Co. 125 3,074
Unicom Corp. 82 3,175
Utilicorp United, Inc. 162 3,952
------------
53,907
------------
Gas Services - 0.9%
Columbia Energy Group 63 3,028
Kinder Morgan Energy Partners, L.P. 41 1,516
KN Energy, Inc. 117 2,404
------------
6,948
------------
Motor Freight & Warehousing - 3.1%
Aliant Communications, Inc. 10 443
Century Telephone Enterprises 147 5,923
Cincinnati Bell, Inc. 64 1,443
CNF Transportation 283 12,350
Piedmont Natural Gas Co. 33 1,049
USFreightways Corp. 43 1,628
------------
22,836
------------
- -----------------------------------------------------------------------------
WHOLESALE TRADE - 0.5%
Durable Goods - 0.3%
Patterson Dental Co. (a) 62 2,248
Ultramed, Inc. (b) 450 (c)
------------
2,248
------------
Nondurable Goods - 0.2%
AmeriSource Health Corp., Class A (a) 39 1,091
Richfood Holdings, Inc. 35 437
------------
1,528
------------
TOTAL COMMON STOCKS (cost of $617,176) 739,871
------------
PREFERRED STOCK - 0.2%
- ------------------------------------------------------------------------------
TRANSPORTATION, COMMUNICATIONS, ELECTRIC
GAS & SANITARY SERVICES - 0.2%
Electric Services
Avista Corp., $1.24, Series L,
(cost of $2,093) 85 1,376
------------
WARRANT - 0.0%
- ------------------------------------------------------------------------------
FINANCE, INSURANCE & REAL ESTATE - 0.0%
Depository Institutions
Golden State Bancorp, Inc.
(cost of $0) 155 291
------------
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
Investment Portfolio/April 30, 1999
-----------------------------------------------------------------------------
<S> <C> <C>
TOTAL INVESTMENTS (cost of $619,269)(d) $ 741,538
------------
SHORT-TERM OBLIGATIONS - 4.1% PAR
- ------------------------------------------------------------------------------
Repurchase agreement with ABN AMRO Chicago Corp.,
dated 04/30/99, due 05/03/99 at 4.870% collateralized by U.S.
Treasury bonds and note with various maturities to 2015, market
value $31,753 (repurchase proceeds $31,183) $ 31,170 31,170
------------
OTHER ASSETS & LIABILITIES, NET - (1.0)% (7,880)
- ------------------------------------------------------------------------------
NET ASSETS - 100% $ 764,828
------------
</TABLE>
NOTES TO INVESTMENT PORTFOLIO:
- ------------------------------------------------------------------------------
(a) Non-income producing.
(b) Ultramed, Inc. is a restricted security which was acquired on
August 14, 1987 at a cost of $450. The fair value is determined
under the direction of the Trustees. This security represents
0.0% of the Fund's net assets at April 30, 1999.
(c) Rounds to less than one.
(d) Cost for federal income tax purposes is the same.
See notes to financial statements.
14
<PAGE>
STATEMENT OF ASSETS & LIABILITIES
APRIL 30, 1999 (UNAUDITED)
(in thousands except for per share amounts and footnotes)
<TABLE>
<CAPTION>
ASSETS
<S> <C> <C>
Investments at value (cost $619,269) $ 741,538
Short-term obligations 31,170
--------------
772,708
Receivable for:
Investments sold $ 4,369
Fund shares sold 1,387
Dividends 348
Interest 4
Foreign tax reclaims 4
Other 47 6,159
----------- --------------
Total Assets 778,867
LIABILITIES
Payable for:
Investments purchased 11,604
Fund shares repurchased 2,420
Accrued:
Deferred Trustees fees 7
Other 8
-----------
Total Liabilities 14,039
--------------
NET ASSETS $ 764,828
==============
Net asset value & redemption price per share -
Class A ($414,457/19,091) $ 21.71 (a)
==============
Maximum offering price per share - Class A
($21.71/0.9425) $ 23.03 (b)
==============
Net asset value & offering price per share -
Class B ($331,089/15,791) $ 20.97 (a)
==============
Net asset value & offering price per share -
Class C ($19,281/899) $ 21.45 (a)
==============
Net asset value, offering and redemption price
per share - Class Z ($1/(c)) $ 21.72
==============
COMPOSITION OF NET ASSETS
Capital paid in $ 558,468
Overdistributed net investment income (1,750)
Accumulated net realized gain 85,841
Net unrealized appreciation 122,269
--------------
$ 764,828
==============
</TABLE>
(a) Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge.
(b) On sales of $50,000 or more the offering price is reduced.
(c) Rounds to less than one.
See notes to financial statements.
15
<PAGE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
(in thousands)
INVESTMENT INCOME
<S> <C> <C>
Dividends $ 3,501
Interest 926
--------------
4,427
EXPENSES
Management fee $ 2,584
Service fee 902
Distribution fee - Class B 1,205
Distribution fee - Class C 61
Transfer agent 1,088
Bookkeeping fee 134
Registration fee 20
Custodian fee 4
Audit fee 18
Trustees fee 18
Reports to shareholders 9
Legal fee 18
Other 99 6,160
----------- --------------
Net Investment Loss (1,733)
--------------
NET REALIZED & UNREALIZED GAIN (LOSS) ON PORTFOLIO POSITIONS
Net realized gain 86,698
Net change in unrealized depreciation
during the period (8,360)
-----------
Net Gain 78,338
--------------
Increase in Net Assets from Operations $ 76,605
--------------
</TABLE>
See notes to financial statements.
16
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
(Unaudited)
Six months ended Year ended
(in thousands) April 30 October 31
----------- --------------
INCREASE (DECREASE) IN NET ASSETS 1999 (a) 1998
Operations:
<S> <C> <C>
Net investment loss $ (1,733) $ (3,326)
Net realized gain 86,698 33,364
Net unrealized appreciation (depreciation) (8,360) 1,599
----------- --------------
Net Increase from Operations 76,605 31,637
Distributions:
From net realized gains - Class A (13,413) (30,679)
From net realized gains - Class B (11,056) (17,924)
From net realized gains - Class C (496) (65)
----------- --------------
51,640 (17,031)
----------- --------------
Fund Share Transactions:
Receipts for shares sold - Class A 49,106 103,672
Value of distributions reinvested - Class A 12,190 27,547
Cost of shares repurchased - Class A (49,193) (93,196)
----------- --------------
12,103 38,023
----------- --------------
Receipts for shares sold - Class B 65,719 167,327
Value of distributions reinvested - Class B 10,397 16,794
Cost of shares repurchased - Class B (61,343) (70,526)
----------- --------------
14,773 113,595
----------- --------------
Receipts for shares sold - Class C 8,294 14,450
Value of distributions reinvested - Class C 473 64
Cost of shares repurchased - Class C (3,092) (1,663)
----------- --------------
5,675 12,851
----------- --------------
Receipts for shares sold - Class Z 1 -
----------- --------------
Net Increase from Fund Share Transactions 32,552 164,469
----------- --------------
Total Increase 84,192 147,438
NET ASSETS
Beginning of period 680,636 533,198
----------- --------------
End of period (net of overdistributed
net investment income of $1,750 and
$39, respectively) $ 764,828 $ 680,636
=========== ==============
</TABLE>
(a) Class Z shares were initially offered on January 11, 1999.
See notes to financial statements.
17
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
(Unaudited)
Six months ended Year ended
(in thousands) April 30 October 31
----------- --------------
NUMBER OF FUND SHARES 1999 (a) 1998
<S> <C> <C>
Sold - Class A 2,340 4,899
Issued for distributions reinvested - Class A 584 1,391
Repurchased - Class A (2,333) (4,457)
----------- --------------
591 1,833
----------- --------------
Sold - Class B 3,227 8,109
Issued for distributions reinvested - Class B 514 868
Repurchased - Class B (3,025) (3,501)
----------- --------------
716 5,476
----------- --------------
Sold - Class C 399 677
Issued for distributions reinvested - Class C 23 3
Repurchased - Class C (149) (81)
----------- --------------
273 599
----------- --------------
Sold - Class Z (b) -
----------- --------------
(b) -
----------- --------------
</TABLE>
(a) Class Z shares were initially offered on January 11, 1999.
(b) Rounds to less than one.
See notes to financial statements.
18
<PAGE>
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1999 (UNAUDITED)
NOTE 1. INTERIM FINANCIAL STATEMENTS
................................................................................
In the opinion of management of Colonial Select Value Fund (the Fund), a series
of Liberty Funds Trust III, formerly 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, 1999,
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 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 investment objective is to
seek long-term growth by investing primarily in middle capitalization equities.
The Fund may issue an unlimited number of shares. The Fund offers four classes
of shares: Class A, Class B, Class C and Class Z. Class A shares are sold with a
front-end sales charge and a 1.00% contingent deferred sales charge on
redemptions made within eighteen months on an original purchase of $1 million to
$5 million. Class B shares 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. Class C shares are
subject to a contingent deferred sales charge on redemptions made within one
year after purchase and an annual distribution fee. Effective January 11, 1999,
the Fund began offering Class Z shares which are offered continuously at net
asset value. There are certain restrictions on the purchase of Class Z shares,
please refer to a prospectus.
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 revenues 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 generally 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.
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.
19
<PAGE>
Notes to Financial Statements/April 30, 1999
- --------------------------------------------------------------------------------
NOTE 2. ACCOUNTING POLICIES - CONT.
................................................................................
Portfolio positions for which market quotations are not readily available are
valued at fair value under procedures approved by the Trustees.
Security transactions are accounted for on the date the securities are
purchased, sold or mature.
Cost is determined and gains (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 and Class C distribution fees), and 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.
Per share data is calculated using the average shares outstanding during the
period. In addition, Class B and Class C net investment income per share data
reflects the distribution fee applicable to Class B and Class C shares only.
Class B and Class C ratios are calculated by adjusting the expense and net
investment income ratios for the Fund for the entire period by the distribution
fee applicable to Class B and Class C 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.
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 carryforwards) under income tax regulations.
Foreign currency transactions: Net realized and unrealized gains (losses) on
foreign currency transactions includes gains (losses) arising from the
fluctuation in exchange rates 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,
interest income, and foreign withholding taxes.
The Fund does not distinguish that portion of gains (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
20
<PAGE>
Notes to Financial Statements/April 30, 1999
- --------------------------------------------------------------------------------
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 (losses) which become
realized at the time the foreign 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 counterparties fail to perform their obligations under the contracts.
Other: Corporate actions are recorded on the 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. Interest income is
recorded on the accrual basis.
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.
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES
................................................................................
Management fee: Colonial Management Associates, Inc. (the Advisor) is the
investment Advisor of the Fund and furnishes accounting and other services and
office facilities for a monthly fee equal to 0.70% annually of the Fund's
average net assets.
Bookkeeping fee: The Advisor 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 fee: Liberty Funds Services, Inc., (the Transfer Agent), an
affiliate of the Advisor, provides shareholder services for a monthly fee equal
to 0.236% annually of the Fund's average net assets and receives reimbursement
for certain out-of-pocket expenses.
Underwriting discounts, service and distribution fees: Liberty Funds
Distributor, Inc., (the Distributor), a subsidiary of the Advisor, is the Fund's
principal underwriter. During the six months ended April 30, 1999, the Fund has
been advised that the Distributor retained net underwriting discounts of
$428,627 on sales of the Fund's Class A shares
21
<PAGE>
Notes to Financial Statements/April 30, 1999
- --------------------------------------------------------------------------------
NOTE 3. FEES AND COMPENSATION PAID TO AFFILIATES - CONT.
................................................................................
and received contingent deferred sales charges (CDSC) of $3,051, $477,748 and
$74,233 on Class A, Class B and Class C share redemptions, respectively.
The Fund has adopted a 12b-1 plan which requires the payment of a distribution
fee to the Distributor equal to 0.75% annually of the average net assets
attributable to Class B and Class C shares. The plan also requires the payment
of a service fee to the Distributor as follows:
Value of shares outstanding on the
20th of each month which were issued Annual Fee Rate
------------------------------------ ---------------
Prior to April 1, 1989 0.15%
On or after April 1, 1989 0.25%
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 Advisor.
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, 1999, purchases and
sales of investments, other than short-term obligations, were $242,317,056 and
$189,921,343, respectively.
Unrealized appreciation (depreciation) at April 30, 1999, based on cost of
investments for both financial statement and federal income tax purposes
purposes was approximately:
Gross unrealized appreciation $179,507,000
Gross unrealized depreciation (57,238,000)
----------------
Net unrealized appreciation $122,269,000
================
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 33 1/3% 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, 1999.
22
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a share of each class outstanding throughout each period
are as follows:
<TABLE>
<CAPTION>
(Unaudited)
Six months ended April 30
-------------------------------------------------
1999
Class A Class B Class C Class Z (a)
----------- ----------- --------- ---------
<S> <C> <C> <C> <C>
Net asset value -
Beginning of period $ 20.170 $ 19.570 $ 20.000 $ 21.970
----------- ----------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (b) (0.013) (0.089) (0.091) 0.012
Net realized and
unrealized gain (loss) 2.273 2.209 2.261 (0.262)
----------- ----------- --------- ---------
Total from Investment
Operations 2.260 2.120 2.170 (0.250)
----------- ----------- --------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net realized gains (0.720) (0.720) (0.720) -
----------- ----------- --------- ---------
Net asset value -
End of period $ 21.710 $ 20.970 $ 21.450 $ 21.720
----------- ----------- --------- ---------
Total return (c)(d) 11.35% 10.97% 10.98% 11.40%
----------- ----------- --------- ---------
RATIOS TO AVERAGE NET ASSETS
Expenses (e)(f) 1.33% 2.08% 2.08% 1.08%
Net investment income (loss) (e)(f) (0.13)% (0.88)% (0.88)% 0.12%
Portfolio turnover (d) 27% 27% 27% 27%
Net assets at end
of period (000) $414,457 $331,089 $ 19,281 $ 1
</TABLE>
(a) Class Z shares were initially offered on January 11, 1999. Per share
amounts reflect activity from that date.
(b) Per share data was calculated using the average shares outstanding during
the period.
(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) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(f) Annualized.
23
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
Year ended October 31
------------------------------------
1998
Class A Class B Class C
---------- --------- ---------
<S> <C> <C> <C>
Net asset value -
Beginning of period $ 20.430 $ 20.020 $20.410
---------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.047) (0.199) (0.201)
Net realized and
unrealized gain 1.637 1.599 1.641
---------- --------- ---------
Total from Investment
Operations 1.590 1.400 1.440
---------- --------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net realized gains (1.850) (1.850) (1.850)
---------- --------- ---------
Net asset value -
End of period $ 20.170 $ 19.570 $20.000
========== ========= =========
Total return (d) 7.95% 7.10% 7.17%
========== ========= =========
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.32% 2.07% 2.07%
Net investment loss (f) (0.23)% (0.98)% (0.98)%
Portfolio turnover 32% 32% 32%
Net assets at end
of period (000) $373,092 $295,025 $12,519
</TABLE>
(a) Class C shares were initially offered on August 1, 1997. Per share amounts
reflect activity from that date.
(b) Per share data was calculated using the average shares outstanding during
the period.
(c) The amount shown for a share outstanding does not correspond with the
aggregate net gain on investments for the period due to the timing of sales
and repurchases of Fund shares in relation to fluctuating market values of
the investments of the Fund.
(d) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(e) Not annualized.
(f) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
24
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
<TABLE>
<CAPTION>
Year ended October 31
----------------------------------
1997
Class A Class B Class C (a)
---------- ---------- ---------
<S> <C> <C>
$ 18.040 $ 17.840 $ 19.860
---------- ---------- ---------
(0.002) (0.135) (0.053)
4.575 4.498 0.603 (c)
---------- ---------- ---------
4.573 4.363 0.550
---------- ---------- ---------
(2.183) (2.183) --
---------- ---------- ---------
$ 20.430 $ 20.020 $ 20.410
========== ========== =========
28.29% 27.33% 2.77% (e)
========== ========== =========
1.03% 1.78% 1.81% (g)
(0.01)% (0.76)% 1.05)% (g)
63% 63% 63%
$340,479 $192,161 $ 558
</TABLE>
25
<PAGE>
FINANCIAL HIGHLIGHTS - CONT.
Selected data for a share of each class outstanding throughout each period are
as follows:
<TABLE>
<CAPTION>
Year ended October 31
---------------------------------------------------------------------------
1996 1995 1994
Class A Class B Class A Class B Class A Class B
<S> <C> <C> <C> <C> <C> <C>
Net asset value -
Beginning of period $ 16.140 $ 16.040 $ 14.020 $13.940 $ 15.240 $ 15.180
--------- ----------- --------- --------- ---------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income
(loss) (a) 0.043 (0.081) 0.174 0.065 0.096 (0.008)
Net realized and
unrealized gain 3.162 3.129 3.326 3.317 0.275 0.288
--------- ----------- --------- --------- ---------- ---------
Total from Investment
Operations 3.205 3.048 3.500 3.382 0.371 0.280
--------- ----------- --------- --------- ---------- ---------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment
income (0.042) (0.005) (0.165) (0.067) (0.071) ---
In excess of net
investment income (0.023) (0.003) --- --- --- ---
From net realized gains (1.240) (1.240) (1.215) (1.215) (1.520) (1.520)
--------- ----------- --------- --------- ---------- ---------
Total Distributions
Declared to Shareholders (1.305) (1.248) (1.380) (1.282) (1.591) (1.520)
--------- ----------- --------- --------- ---------- ---------
Net asset value -
End of period $ 18.040 $ 17.840 $ 16.140 $16.040 $ 14.020 $ 13.940
========= =========== ========= ========= ========== =========
Total return (b) 21.28% 20.31% 28.44% 27.50% 2.78% 2.12%
========= =========== ========= ========= ========== =========
RATIOS TO AVERAGE NET ASSETS
Expenses 1.17% (c) 1.92% (c) 1.12% 1.90% 1.22% 1.97%
Net investment income (loss) 0.25% (c) (0.50)% (c) 1.24% 0.46% 0.69% (0.06)%
Portfolio turnover 100% 100% 92% 92% 121% 121%
Net assets at end
of period (000) $255,911 $128,283 $194,393 $75,283 $128,283 $ 53,218
</TABLE>
(a) Per share data was calculated using the average shares outstanding during
the period.
(b) Total return at net asset value assuming all distributions reinvested and
no initial sales charge or contingent deferred sales charge.
(c) The benefits derived from custody credits and directed brokerage
arrangements had no impact. Prior years' ratios are net of benefits
received, if any.
26
<PAGE>
IMPORTANT INFORMATION ABOUT THIS REPORT
The Transfer Agent for Colonial Select Value Fund is:
Liberty Funds Services, Inc.*
P.O. Box 1722
Boston, MA 02105-1722
1-800-345-6611
Colonial Select Value Fund mails one shareholder report to each shareholder
address. If you would like more than one report, please call 1-800-426-3750 and
additional reports will be sent to you.
This report has been prepared for shareholders of Colonial Select Value 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 and the most recent copy of
Liberty Funds Distributor, Inc. Performance Update.
* EFFECTIVE OCTOBER 1, 1998, COLONIAL INVESTORS SERVICE CENTER, INC. -- THE
TRANSFER AGENT FOR COLONIAL, CRABBE HUSON, NEWPORT AND STEIN ROE ADVISOR
FUNDS -- CHANGED ITS NAME TO LIBERTY FUNDS SERVICES, INC.
27
<PAGE>
TRUSTEES
ROBERT J. BIRNBAUM
Consultant (formerly Special Counsel, Dechert, Price & Rhoads; President and
Chief Operating Officer, New York Stock Exchange, Inc.; President, American
Stock Exchange, Inc.)
TOM BLEASDALE
Retired (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
JOHN CARBERRY
Senior Vice President of Liberty Financial Companies, Inc. (formerly Managing
Director, Salomon Brothers)
LORA S. COLLINS
Attorney (formerly Attorney, Kramer, Levin, Naftalis & Frankel)
JAMES E. GRINNELL
Private Investor (formerly Senior Vice President-Operations, The Rockport
Company)
RICHARD W. LOWRY
Private Investor (formerly Chairman and Chief Executive Officer, U.S. Plywood
Corporation)
SALVATORE MACERA
Private Investor (formerly Executive Vice President of Itek Corp. and President
of Itek Optical & Electronic Industries, Inc.)
WILLIAM E. MAYER
Partner, Development Capital, LLC (formerly Dean, College of Business and
Management, University of Maryland; Dean, Simon Graduate School of Business,
University of Rochester; Chairman and Chief Executive Officer, CS First Boston
Merchant Bank; and President and Chief Executive Officer, The First Boston
Corporation)
JAMES L. MOODY, JR.
Retired (formerly Chairman of the Board, Chief Executive Officer and Director,
Hannaford Bros. Co.)
JOHN J. NEUHAUSER
Dean, Boston College School of Management
THOMAS E. STITZEL
Professor of Finance, College of Business, Boise State University; Business
Consultant and Author
ROBERT L. SULLIVAN
Retired Partner, KPMG LLP (formerly Management Consultant, Saatchi and Saatchi
Consulting Ltd. and Principal and International Practice Director, Management
Consulting, Peat Marwick Main & Co.)
ANNE-LEE VERVILLE
Consultant (formerly General Manager, Global Education Industry, and President,
Applications Solutions Division, IBM Corporation)
[LIBERTY LOGO]
Liberty
COLONIAL o CRABBE HUSON o NEWPORT o STEIN ROE ADVISOR
Liberty Funds Distributor, Inc. (copyright)1999
One Financial Center, Boston, MA 02111-2621, 1-800-426-3750
visit us at www.libertyfunds.com SV-03/113H-0499 (6/99) 99/704
