<PAGE> 1
COLONIAL SELECT VALUE FUND Semiannual Report
APRIL 30, 2000
<PAGE> 2
PRESIDENT'S MESSAGE
Dear Shareholder:
Continued U.S. economic growth was a double-edged sword during the six months
ended April 30. Industrial production and new job creation remained strong while
consumer confidence and consumer spending reached new highs. All this strength
stirred up fears of higher inflation. Concerned that inflationary pressures
might derail the U.S. economic expansion, now in its ninth year, the Federal
Reserve raised short-term interest rates three times between November 1, 1999
and April 30, 2000.
Against this economic backdrop, the stock market was volatile. Stocks in general
gained modestly. The notable exceptions were growth-oriented and technology-
related issues, which did well until the end of the period, when they declined
sharply. Mid-cap stocks benefited from investors' search for value later in the
period.
Colonial Select Value Fund invests primarily in mid-capitalization, value
stocks. The managers keep the portfolio broadly diversified, rather than
following hot trends. By adhering to that strategy, the Fund has outpaced its
peer group for the 1-, 3-, 5- and 10-year periods ended April 30, 2000.(1)
In the pages that follow, Fund managers James Haynie and Michael Rega will
provide you with more specific information about the Fund's performance and
investment strategies. As always, we thank you for choosing Colonial Select
Value Fund and for the opportunity to serve your investment needs.
Sincerely,
/s/Stephen E. Gibson
Stephen E. Gibson
President
June 15, 2000
(1) Lipper, Inc., a widely respected data provider in the industry, calculates
average total returns for mutual funds using classification categories which
are based upon portfolio holdings. The Fund's Class A shares were ranked in
the second quartile of the Lipper Multi-Cap Core category for the six-month
period ended 4/30/00 (126 out of 397), in the second quartile for the 1 year
(120 out of 356 funds), in the second quartile for the 3 years (84 out of
213 funds), in the second quartile for the 5 years (46 out of 122 funds) and
in the second quartile for 10 years (27 out of 53 funds). Rankings do not
include sales charges. Performance for different share classes will vary
with fees associated with each class. Past performance cannot predict future
results.
Because economic and market conditions change frequently, there can be no
assurance that the trends described in this report will continue or come to
pass.
Not FDIC Insured
May Lose Value
No Bank Guarantee
<PAGE> 3
HIGHLIGHTS
- MARKET VOLATILITY INCREASED.
Continued U.S. economic growth and fears of inflation resulted in a
volatile stock market. Despite strong earnings, stock prices were up only
modestly for the six months ended April 30, 2000.
- GROWTH AND TECHNOLOGY STOCKS LED FOR MOST OF THE PERIOD.
A small group of large-cap and technology stocks led the market's rise
through the end of 1999 and into the new year. These stocks stumbled in the
final weeks of the period.
- MID-CAPITALIZATION STOCKS OUTPERFORMED SMALL- AND LARGE-CAP STOCKS.
In search of more attractively priced alternatives to large-cap and
technology stocks, investors increasingly turned to the mid-cap segment
during the first half of the Fund's fiscal year.
- FUND MANAGERS STUCK WITH A LONG-TERM STRATEGY.
Staying true to their long-term strategy, the Fund's managers kept the Fund
diversified rather than following the hot tech sector. As a result, the
Fund underperformed the Standard & Poor's MidCap 400 Index.
COLONIAL SELECT VALUE FUND VS. S&P MIDCAP 400 INDEX
10/31/99 - 4/30/00
<TABLE>
<CAPTION>
[BAR GRAPH]
<S> <C>
Colonial Select
Value Fund
(Class A shares without
sales charge) .................... 16.86%
S&P Midcap
400 Index ........................ 21.26%
</TABLE>
<TABLE>
<CAPTION>
NET ASSET VALUE PER SHARE ON 4/30/00
<S> <C>
Class A $23.08
_____________________________
Class B $22.03
_____________________________
Class C $22.59
_____________________________
Class Z $23.15
_____________________________
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTIONS DECLARED PER
SHARE FROM 11/1/99 TO 4/30/00
<S> <C>
Class A 2.271%
_____________________________
Class B 2.271%
_____________________________
Class C 2.271%
_____________________________
Class Z 2.271%
_____________________________
</TABLE>
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. The Standard &
Poor's (S&P) MidCap 400 Index is an unmanaged index that tracks the performance
of mid-capitalization U.S. stocks. Unlike mutual funds, indexes are not
investments and do not incur fees or expenses. It is not possible to invest in
an index.
1
<PAGE> 4
PORTFOLIO MANAGERS' REPORT
SECTOR BREAKDOWNS AS
OF 4/30/00 VS. 10/31/99
<TABLE>
<CAPTION>
4/30/00 10/31/99
_______ ________
<S> <C> <C>
Technology 24.3% 24.8%
Financials 14.8% 16.2%
Consumer cyclical 12.4% 15.2%
Utilities 10.2% 8.9%
Capital goods 9.1% 5.7%
</TABLE>
Sector breakdowns are calculated as a percentage of total equity investments.
Because the Fund is actively managed, there is no guarantee the Fund will
maintain these sector breakdowns in the future.
Industry sectors in the following financial statements are based upon the
standard industrial classifications (SIC) as published by the U.S. Office of
Management and Budget. The sector classifications used on this page are based
upon the Advisor's defined criteria as used in the investment process.
BOUGHT
INGERSOLL RAND
We added to our shares of Ingersoll Rand (1.00% of net assets), a manufacturer
of machinery and industrial equipment, because it has executed its business plan
more effectively than many of its competitors. In addition, it was very
attractively priced when we added to our position in both December and February.
FUND'S PERFORMANCE REFLECTS MID-CAP MARKET'S STRENGTH
During the six-month period ended April 30, 2000, the Fund had a total return of
16.86%, based on Class A shares without a sales charge. By comparison, the S&P
MidCap 400 Index had a total return of 21.26% during the same period. The Fund's
underperformance can mainly be attributed to the fact that the Fund was
underweighted in market-leading growth sectors, such as technology and
biotechnology.
FUND BENEFITED FROM TECHNOLOGY AND ENERGY HOLDINGS
During the period, technology holdings were among our best performers. In
particular, semiconductors -- Xilinx, a leading manufacturer of microchips and
Teradyne, a company that manufactures test equipment for the chip industry (0.9%
and 1.2% of net assets, respectively) both performed exceptionally well. Fueled
by strong demand for all types of chips, earnings for both companies expanded
rapidly.
Buoyed by the rising price of oil, stocks in the energy sector were also strong
performers. Falcon Drilling (0.7% of net assets) an oil service company, leases
drilling rigs that provide offshore drilling services to companies that explore
and produce oil and natural gas. The dramatic rise in the price of oil and gas
in the last 12 months has created vigorous demand for Falcon Drilling's drilling
rigs. Subsequently, expectations for earnings and the stock price for Falcon
Drilling have risen substantially. Media giant Times Mirror also got a big boost
on news that the Tribune Company intended to acquire it. We agreed to tender the
shares back to the company for approximately double our purchase price.
STRATEGY OF DIVERSIFICATION
Our diversified approach aided the Fund's performance during the past six months
because volatility was especially high. Throughout the period, we maintained our
long-held strategy of staying diversified among a broad array of individual
holdings across a large number of industries. This diversification prevented the
Fund from being overly dependent on the fortunes of one industry group or a
handful of individual names.
OUTLOOK FOR MID-CAP STOCKS IS POSITIVE
Though large-cap stocks have been the market leaders for the past few years, we
believe that mid-cap stocks may be poised to take the lead. Even with the recent
pullback, many of the largest capitalization stocks remain expensive, and
investors are looking for more attractively priced alternatives.
/s/JAMES P. HAYNIE /s/MICHAEL E. REGA
James Haynie Michael Rega
James Haynie is a senior vice president of Colonial Management Associates (CMA)
and senior portfolio manager. Michael Rega is a vice president of CMA and
co-manages the Fund.
Investing in medium-sized companies involves certain risks, including price
fluctuations caused by economic and business developments.
2
<PAGE> 5
PERFORMANCE INFORMATION
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/00
<TABLE>
<CAPTION>
Share Class A B C Z
Inception 1949 6/8/92 8/1/97 1/11/99
______________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C>
w/o sales with sales w/o sales with sales w/o sales with sales w/o sales
charge charge charge charge charge charge charge
______________________________________________________________________________________________
Six-month
cumulative 16.86% 10.14% 16.44% 11.44% 16.40% 15.40% 17.03%
______________________________________________________________________________________________
One Year 18.04% 11.25% 17.17% 12.17% 17.15% 16.15% 18.32%
______________________________________________________________________________________________
Five Years 21.57% 20.13% 20.66% 20.47% 21.10% 21.10% 21.63%
______________________________________________________________________________________________
10 Years 16.20% 15.51% 15.52% 15.52% 15.98% 15.98% 16.23%
______________________________________________________________________________________________
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS AS OF 3/31/99
<TABLE>
<CAPTION>
Share Class A B C Z
______________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C>
w/o sales with sales w/o sales with sales w/o sales with sales w/o sales
charge charge charge charge charge charge charge
______________________________________________________________________________________________
Six-month
cumulative 22.97% 15.90% 22.56% 17.56% 22.53% 21.53% 23.15%
______________________________________________________________________________________________
One Year 25.96% 18.72% 25.02% 20.02% 25.00% 24.00% 26.20%
______________________________________________________________________________________________
Five Years 22.37% 20.93% 21.45% 21.26% 21.92% 21.92% 22.43%
______________________________________________________________________________________________
10 Years 16.01% 15.32% 15.34% 15.34% 15.79% 15.79% 16.03%
______________________________________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
TOP 10 HOLDINGS AS OF 4/30/00
<S> <C>
Apple Computer 1.4%
_____________________________
Teradyne 1.2%
_____________________________
VERITAS Software 1.2%
_____________________________
Vishay Intertechnology 1.2%
_____________________________
ADC Telecom 1.1%
_____________________________
Altera 1.0%
_____________________________
Ingersoll Rand 1.0%
_____________________________
Xilinix 0.9%
_____________________________
Maxim Integrated Products 0.9%
_____________________________
Linear Technology 0.9%
_____________________________
</TABLE>
Holdings are calculated as a percentage of net assets. Because the Fund is
actively managed, there can be no guarantee the Fund will continue to maintain
these holdings in the future.
SOLD
TOMMY HILFIGER
Tommy Hilfiger didn't sustain growth in an increasingly difficult environment
for retailers.
Past performance cannot predict future investment results. Returns and value of
an investment will vary, resulting in a gain or loss on sale. All results shown
assume reinvestment of distributions. The "with sales charge" returns include
the maximum 5.75% sales charge for Class A shares, the appropriate Class B
contingent deferred sales charge for the holding period after purchase as
follows: through first year -- 5%, second year -- 4%, third year -- 3%, fourth
year -- 3%, fifth year -- 2%, sixth year -- 1%, thereafter -- 0% and the Class C
contingent deferred sales charge of 1% for the first year only. Performance
results reflect any voluntary waivers or reimbursement of Fund expenses by the
Advisor or its affiliates. Absent these waivers or reimbursement arrangements,
performance would have been lower.
Performance for different share classes will vary based on difference in share
charges and fees associated with each class.
Class B, C and Z share (newer class shares) performance information includes
returns of the Fund's Class A shares (the oldest existing Fund class) for
periods prior to the inception of the newer class shares. These Class A share
returns were not restated to reflect any expense differential (e.g. Rule 12b-1
fees) between Class A shares and the newer class shares. Had the expense
differential been reflected, the returns for the periods prior to inception of
the newer class shares would have been lower.
3
<PAGE> 6
INVESTMENT PORTFOLIO
April 30, 2000(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
COMMON STOCKS - 97.0% SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
CONSTRUCTION - 0.2%
HEAVY CONSTRUCTION-NON BUILDING CONSTRUCTION
Fluor Corp. 53 $ 1,782
________
FINANCE, INSURANCE & REAL ESTATE - 15.4%
DEPOSITORY INSTITUTIONS - 5.8%
City National Corp. 147 5,404
Compass Bancshares, Inc. 90 1,665
Crestar Financial Corp. 195 3,954
Cullen/Frost Bankers, Inc. 131 3,222
Golden State Bancorp, Inc. (a) 263 4,047
Greenpoint Financial Corp. 236 4,403
Hibernia Corp. 190 2,017
North Fork Bancorporation, Inc. 282 4,571
Pacific Century Financial Corp. 87 1,785
Peoples Heritage Financial Group, Inc. 216 2,815
Sovereign Bancorp, Inc. 507 3,483
UnionBanCal Corp. 143 3,965
Webster Financial Corp. 115 2,449
________
43,780
________
FINANCIAL SERVICES - 0.9%
Cincinnati Financial Corp. 72 2,898
Financial Security Assurance Holdings Ltd. 54 4,001
________
6,899
________
INSURANCE CARRIERS - 6.3%
Allmerica Financial Corp. 62 3,377
Ambac Financial Group, Inc. 113 5,429
Hartford Life, Inc., Class A 72 3,541
Loews Corp. 70 3,831
MGIC Investment Corp. 70 3,328
Nationwide Financial Services, Inc., Class A 155 4,305
Premark International, Inc. 100 4,853
Protective Life Corp. 60 1,429
St. Paul Cos., Inc. 122 4,339
The MONY Group, Inc. (a) 62 1,912
United Healthcare Corp. 98 6,535
Wellpoint Health Networks, Inc. 62 4,587
________
47,466
________
NONDEPOSITORY CREDIT INSTITUTIONS - 0.3%
Capital One Financial Corp. 57 2,494
________
REAL ESTATE - 0.6%
Radian Group, Inc. 95 4,814
________
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
SECURITY BROKERS & DEALERS - 1.5%
A.G. Edwards, Inc. 79 $ 2,976
Lehman Brothers Holdings, Inc. 72 5,884
Paine Webber Group, Inc. 49 2,150
________
11,010
________
MANUFACTURING - 44.2%
CHEMICALS & ALLIED PRODUCTS - 5.6%
Biogen, Inc. (a) 49 2,876
Chiron Corp. (a) 78 3,520
Ecolab, Inc. 21 824
FMC Corp. (a) 66 3,840
Fuller (H.B.) Co. 25 972
Goodrich (B.F.) Co. 188 5,999
Great Lakes Chemical Corp. 88 2,371
IVAX Corp. (a) 159 4,349
Immunex Corp. (a) 15 571
Lubrizol Corp. 171 4,377
Mylan Laboratories, Inc. 125 3,547
Solutia, Inc. 243 3,308
W.R. Grace & Co. (a) 189 2,457
Watson Pharmaceuticals, Inc. (a) 68 3,051
________
42,062
________
COMMUNICATIONS EQUIPMENT - 3.1%
ADC Telecommunications, Inc. (a) 130 7,891
Altera Corp. (a) 77 7,873
Comverse Technology, Inc. (a) 64 5,744
Harris Corp. 49 1,593
________
23,101
________
ELECTRIC MACHINERY, COMPONENTS & SUPPLIES - 0.3%
Harmonic, Inc. (a) 26 1,912
________
ELECTRONIC & ELECTRICAL EQUIPMENT - 3.2%
Advanced Digital Information Corp. (a) 22 538
Applied Micro Circuits Corp. (a) 46 5,967
Atmel Corp. (a) 74 3,607
Intuit, Inc. (a) 84 3,030
Micron Technology, Inc. 13 1,810
Vishay Intertechnology, Inc. (a) 106 8,857
________
23,809
________
</TABLE>
See notes to investment portfolio.
4
<PAGE> 7
INVESTMENT PORTFOLIO (Continued)
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED) SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
ELECTRONIC COMPONENTS - 6.9%
Analog Devices, Inc. (a) 40 $ 3,080
Dallas Semiconductor Corp. 68 2,928
LSI Logic Corp. (a) 51 3,213
Linear Technology Corp. 119 6,798
Maxim Integrated Products, Inc. (a) 106 6,851
Microchip Technology, Inc. (a) 45 2,793
National Semiconductor Corp. (a) 47 2,849
Novellus Systems, Inc. (a) 98 6,562
Sanmina Corp. (a) 77 4,649
Vitesse Semiconductor Corp. (a) 72 4,907
Xilinx, Inc. (a) 95 6,988
________
51,618
________
FABRICATED METAL - 0.3%
Crown Cork & Seal Co., Inc. 141 2,293
________
FOOD & KINDRED PRODUCTS - 2.2%
Hormel Foods Corp. 137 2,095
IBP, Inc. 73 1,208
Interstate Bakeries Corp. 182 2,317
McCormick & Co. 97 3,019
The McClatchy Co. 112 3,561
The Pepsi Bottling Group, Inc. 193 4,166
________
16,366
________
FURNITURE & FIXTURES - 2.1%
Furniture Brands International, Inc. (a) 239 4,472
Herman Miller, Inc. 119 3,269
Johnson Controls, Inc. 93 5,856
Leggett & Platt, Inc. 88 1,877
________
15,474
________
HOUSEHOLD APPLIANCES - 0.4%
Whirlpool Corp. 52 3,367
________
LUMBER & WOOD PRODUCTS - 0.4%
Georgia Pacific Corp. 91 3,352
________
MACHINERY & COMPUTER EQUIPMENT - 4.6%
Apple Computer, Inc. 86 10,682
Brunswick Corp. 122 2,345
Diebold, Inc. 137 3,963
Dover Corp. 93 4,700
Ingersoll Rand Co. 157 7,374
Unisys Corp. (a) 182 4,208
York International Corp. 63 1,513
________
34,785
________
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
MEASURING & ANALYZING INSTRUMENTS - 3.4%
Bard (C.R.), Inc. 40 $ 1,742
JDS Uniphase Corp. (a) 45 4,679
PE Corp-PE Biosystems Group 29 1,728
Teradyne, Inc. (a) 85 9,306
Thermo Electron Corp. (a) 161 3,125
Waters Corp. 49 4,646
________
25,226
________
PAPER PRODUCTS - 1.2%
Boise Cascade Corp. 95 3,100
Westvaco Corp. 85 2,618
Willamette Industries, Inc. 91 3,460
________
9,178
________
PETROLEUM REFINING - 2.1%
Amerada Hess Corp. 47 2,990
Lyondell Petrochemical Co. 322 5,908
Tosco Corp. 160 5,117
Ultramar Diamond Shamrock Corp. 66 1,624
________
15,639
________
PRIMARY METAL - 1.5%
Engelhard Corp. 175 3,079
Mueller Industries, Inc. (a) 148 4,875
Nucor Corp. 70 3,018
________
10,972
________
PRINTING & PUBLISHING - 1.9%
Knight-Ridder, Inc. 88 4,322
New York Times Co., Class A 115 4,737
Time Warner Telecom, Inc., Class A (a) 9 515
Valassis Communications, Inc. (a) 130 4,418
________
13,992
________
RUBBER & PLASTIC - 1.5%
Grant Prideco, Inc. (a) 104 1,998
Tupperware Corp. 166 3,135
Weatherford International, Inc. (a) 104 4,217
Wynn's International, Inc. 146 2,024
________
11,374
________
STONE, CLAY, GLASS & CONCRETE - 0.9%
Lafarge Corp. 78 1,969
USG Corp. 123 5,144
________
7,113
________
</TABLE>
See notes to investment portfolio.
5
<PAGE> 8
INVESTMENT PORTFOLIO(Continued)
April 30, 2000(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED) SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
TRANSPORTATION EQUIPMENT - 2.6%
Harley-Davidson, Inc. 118 $ 4,698
Lear Corp. (a) 175 5,245
Meritor Automotive, Inc. 282 4,229
Navistar International Corp. (a) 130 4,536
Northrop Grumman Corp. 14 1,006
________
19,714
________
________________________________________________________________________________
MINING & ENERGY - 5.0%
OIL & GAS EXTRACTION - 3.0%
Falcon Drilling Co., Inc. (a) 244 5,063
Noble Drilling Corp. (a) 144 5,735
RealNetworks, Inc. (a) 58 2,777
SEACOR SMIT, Inc. (a) 75 4,569
Transocean Sedco Forex, Inc. 88 4,122
________
22,266
________
OIL & GAS FIELD SERVICES - 2.0%
BJ Services Co. (a) 82 5,739
Diamond Offshore Drilling, Inc. 130 5,241
Petroleum Geo-Services ADR (a) 232 3,768
________
14,748
________
________________________________________________________________________________
RETAIL TRADE - 4.6%
APPAREL & ACCESSORY STORES - 0.8%
Abercrombie & Fitch Co. (a) 141 1,546
Ross Stores, Inc. 210 4,353
________
5,899
________
GENERAL MERCHANDISE STORES - 1.1%
BJ's Wholesale Club, Inc. (a) 123 4,341
Federated Department Stores, Inc. (a) 107 3,624
________
7,965
________
HOME FURNISHINGS & EQUIPMENT - 1.2%
Best Buy Co., Inc. (a) 79 6,395
Circuit City Stores, Inc. 40 2,335
________
8,730
________
MISCELLANEOUS RETAIL - 0.1%
Zale Corp. (a) 26 1,077
________
RESTAURANTS - 1.4%
Brinker International, Inc. (a) 174 5,540
Tricon Global Restaurants, Inc. (a) 148 5,040
________
10,580
________
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
________________________________________________________________________________
SERVICES - 10.4%
AMUSEMENT & RECREATION - 0.9%
<S> <C> <C>
Harrah's Entertainment, Inc. (a) 169 $ 3,475
Park Place Entertainment Corp. (a) 230 2,947
________
6,422
________
AUTO REPAIR, RENTAL & PARKING - 0.4%
Hertz Corp., Class A 87 2,713
________
BUSINESS SERVICES - 1.1%
BEA Systems, Inc. (a) 34 1,660
Interpublic Group of Cos., Inc. 69 2,845
Omnicom Group, Inc. 45 4,098
________
8,603
________
COMPUTER RELATED SERVICES - 2.7%
Comdisco, Inc. 127 3,945
Convergys Corp. (a) 119 5,249
DST Systems Inc. (a) 53 3,962
Sensormatic Electronics Corp. 38 637
Siebel Systems, Inc. (a) 54 6,635
________
20,428
________
COMPUTER SOFTWARE - 3.4%
Adobe Systems, Inc. 32 3,906
CMGI, Inc. (a) 19 1,340
Citrix Systems, Inc. (a) 69 4,189
Electronic Arts, Inc. (a) 41 2,499
Symantec Corp. (a) 70 4,339
VERITAS Software Corp. (a) 86 9,203
________
25,476
________
ENGINEERING, ACCOUNTING, RESEARCH & MANAGEMENT - 1.2%
ACNielsen Corp. (a) 114 2,629
Paychex, Inc. 117 6,174
________
8,803
________
HEALTH SERVICES - 0.7%
First Health Group Corp. (a) 26 797
Lincare Holdings, Inc. (a) 134 4,096
________
4,893
________
________________________________________________________________________________
TRANSPORTATION, COMMUNICATIONS, ELECTRIC,
GAS & SANITARY SERVICES - 16.6%
AIR TRANSPORTATION - 0.6%
Delta Air Lines, Inc. 93 4,900
________
BROADCASTING - 0.8%
Univision Communications, Inc., Class A (a) 52 5,681
________
</TABLE>
See not to investment portfolio.
6
<PAGE> 9
INVESTMENT PORTFOLIO (CONTINUED)
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED) SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
COMMUNICATIONS - 1.1%
Inco Ltd. 216 $ 3,375
Telephone and Data Systems, Inc. 48 4,896
________
8,271
________
ELECTRIC, GAS & SANITARY SERVICES - 1.3%
Calpine Corp. (a) 58 5,344
Conectiv, Inc. 276 4,902
________
10,246
________
ELECTRIC SERVICES - 7.4%
Allegheny Energy, Inc. 159 4,814
Citizens Utilities Co. 46 736
Dominion Resources, Inc. 32 1,419
Energy East Corp. 225 4,688
Entergy Corp. 147 3,742
Florida Progress Corp. 97 4,748
GPU, Inc. 123 3,440
Minnesota Power, Inc. 285 5,251
PG&E Corp. 117 3,045
PP&L Resources, Inc. 142 3,400
Peco Energy Co. 99 4,123
Potomac Electric Power Co. 172 4,020
Puget Sound Energy, Inc. 104 2,463
Unicom Corp. 142 5,645
Utilicorp United, Inc. 198 3,819
________
55,353
________
GAS SERVICES - 1.5%
Airgas, Inc. (a) 199 1,166
Columbia Energy Group 63 3,953
El Paso Energy Corp. 85 3,591
Peoples Energy Corp. 75 2,330
________
11,040
________
MOTOR FREIGHT & WAREHOUSING - 1.0%
CNF Transportation, Inc. 156 4,350
USFreightways Corp. 63 2,942
________
7,292
________
RAILROAD - 0.3%
Canadian Pacific, Ltd. 105 2,488
________
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
________________________________________________________________________________
<S> <C> <C>
TELECOMMUNICATION - 2.6%
Broadwing, Inc. (a) 62 $ 1,766
CenturyTel, Inc. 136 3,323
Chris-Craft Industries, Inc. (a) 51 3,158
Covad Communications Group, Inc. (a) 105 2,914
Electronics for Imaging, Inc. (a) 52 2,712
NTL, Inc. (a) 23 1,788
PMC-Sierra, Inc. (a) 11 2,130
Powerwave Technologies, Inc. (a) 9 1,831
__________
19,622
__________
________________________________________________________________________________
WHOLESALE TRADE - 0.6%
DURABLE GOODS
Patterson Dental Co. (a) 86 4,156
Ultramed, Inc. (b) 450 (c)
__________
4,156
__________
TOTAL COMMON STOCKS
(cost of $589,853) 727,244
__________
WARRANTS - 0.0%
________________________________________________________________________________
FINANCE, INSURANCE & REAL ESTATE
DEPOSITORY INSTITUTIONS
Golden State Bancorp
(cost of $0) 155 160
__________
TOTAL INVESTMENTS
(cost of $589,853) (d) 727,404
__________
SHORT TERM OBLIGATIONS - 2.1% PAR
________________________________________________________________________________
REPURCHASE AGREEMENT with SBC
Warburg Ltd., dated 04/28/00, due
05/01/00 at 5.710%, collateralized
by U.S. Treasury notes with various
maturities to 2025, market value $16,487
(repurchase proceeds $16,123) $ 16,115 16,115
__________
OTHER ASSETS & LIABILITIES, NET - 0.9% 6,903
________________________________________________________________________________
Net Assets - 100% $750,422
__________
NOTES TO INVESTMENT PORTFOLIO:
________________________________________________________________________________
</TABLE>
(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, 2000.
(c) Rounds to less than one.
(d) Cost for federal income tax purposes is the same.
ACRONYM NAME
_______ ____
ADR American Depositary Receipt
See notes to financial statements.
7
<PAGE> 10
STATEMENT OF ASSETS AN LIABILITIES
April 30, 2000 (Unaudited)
(In thousands except for per share amounts and footnotes)
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Investments at value (cost $589,853) $727,404
Short-term obligations 16,115
_________
743,519
Receivable for:
Investments sold $8,304
Fund shares sold 473
Dividends 426
Interest 5
Other 10 9,218
__ _________
Total Assets 752,737
LIABILITIES
Payable for:
Fund shares repurchased 1,596
Accrued:
Management fee 429
Transfer agent fee 207
Bookkeeping fee 22
Service fee -- Class A, Class B, Class C 22
Distribution fee -- Class C 1
Deferred Trustees' fees 8
Other 30
____
Total Liabilities 2,315
__________
NET ASSETS $ 750,422
Net asset value & redemption price per share-- _________
Class A ($409,166/17,728) $ 23.08(a)
Maximum offering price per share -- _________
Class A ($23.08/0.9425) $ 24.49(b)
Net asset value & offering price per share -- _________
Class B ($317,679/14,422) $ 22.03(a)
Net asset value & offering price per share -- _________
Class C ($22,523/997) $ 22.59(a)
Net asset value, offering and redemption _________
price per share --
Class Z ($1,054/45) $ 23.15
_________
COMPOSITION OF NET ASSETS
Capital paid in $ 515,694
Overdistributed net investment income (1,306)
Accumulated net realized gain 98,483
Net unrealized appreciation 137,551
_________
$ 750,422
_________
</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.
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2000 (Unaudited)
(In thousands)
<TABLE>
<CAPTION>
INVESTMENT INCOME
<S> <C> <C>
Dividends $ 4,140
Interest 624
_________
4,764
EXPENSES
Management fee $ 2,606
Service fee -- Class A, Class B, Class C 925
Distribution fee -- Class B 1,189
Distribution fee -- Class C 83
Transfer agent fee 1,059
Bookkeeping fee 135
Trustees' fees 19
Custodian fee 1
Audit fee 12
Legal fee 16
Registration fee 30
Reports to shareholders 10
Other 46 6,131
___ ______
Net Investment Loss (1,367)
_______
NET REALIZED & UNREALIZED GAIN ON
PORTFOLIO POSITIONS
Net realized gain 98,542
Net change in unrealized
appreciation/depreciation 16,963
______
Net Gain 115,505
_________
Increase in Net Assets from Operations $ 114,138
_________
</TABLE>
See notes to financial statements.
8
<PAGE> 11
STATEMENT OF CHANGES IN NET ASSETS
(In thousands)
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS YEAR ENDED
ENDED APRIL 30, OCTOBER 31,
--------------- -----------
INCREASE (DECREASE) IN NET ASSETS 2000 1999(a)
------------------------------------------------------------------------------------
Operations:
<S> <C> <C>
Net investment loss $ (1,367) $ (3,678)
Net realized gain 98,542 97,073
Net change in unrealized
appreciation/depreciation 16,963 (10,041)
--------- ---------
Net Increase from Operations 114,138 83,354
Distributions:
From net realized gains -- Class A (40,661) (13,413)
From net realized gains -- Class B (33,607) (11,056)
From net realized gains -- Class C (2,248) (496)
From net realized gains -- Class Z (75) --
--------- ---------
37,547 58,389
--------- ---------
Fund Share Transactions:
Receipts for shares sold -- Class A 49,867 92,281
Value of distributions reinvested -- Class A 36,976 12,199
Cost of shares repurchased -- Class A (98,226) (113,020)
--------- ---------
(11,383) (8,540)
--------- ---------
Receipts for shares sold -- Class B 32,350 99,336
Value of distributions reinvested -- Class B 31,746 10,448
Cost of shares repurchased -- Class B (74,286) (114,510)
--------- ---------
(10,190) (4,726)
--------- ---------
Receipts for shares sold -- Class C 3,743 14,671
Value of distributions reinvested -- Class C 2,174 473
Cost of shares repurchased -- Class C (6,037) (7,305)
--------- ---------
(120) 7,839
--------- ---------
Receipts for shares sold -- Class Z 471 656
Value of distributions reinvested -- Class Z 75 --
Cost of shares repurchased -- Class Z (231) (1)
--------- ---------
315 655
--------- ---------
Net Decrease from Fund Share Transactions (21,378) (4,772)
--------- ---------
Total Increase 16,169 53,617
NET ASSETS
Beginning of period 734,253 680,636
--------- ---------
End of period (net of overdistributed and
including undistributed net investment
income of $1,306 and $61, respectively) $750,422 $ 734,253
--------- ---------
</TABLE>
<TABLE>
<CAPTION>
(UNAUDITED)
SIX MONTHS YEAR ENDED
ENDED APRIL 30, OCTOBER 31,
----------------------------
NUMBER OF FUND SHARES 2000 1999(a)
---------------------------------------------------------------------------------
<S> <C> <C>
Sold -- Class A 2,284 4,303
Issued for distributions reinvested -- Class A 1,797 584
Repurchased -- Class A (4,509) (5,231)
------ ------
(428) (344)
------ ------
Sold -- Class B 1,535 4,799
Issued for distributions reinvested -- Class B 1,611 517
Repurchased -- Class B (3,593) (5,522)
------ ------
(447) (206)
------ ------
Sold -- Class C 175 693
Issued for distributions reinvested -- Class C 108 22
Repurchased -- Class C (283) (344)
------ ------
-- 371
------ ------
Sold -- Class Z 21 31
Issued for distributions reinvested -- Class Z 3 --
Repurchased -- Class Z (10) (b)
------ ------
14 31
------ ------
</TABLE>
(a) Class Z shares were initially offered on January 11, 1999.
(b) Rounds to less than one.
See notes to financial statements.
9
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS
April 30, 2000 (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, 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. A 1.00% contingent deferred sales charge is assessed 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. Effective February 1, 2000, Class B shares
will convert to Class A shares as follows:
<TABLE>
<CAPTION>
CONVERTS TO
ORIGINAL PURCHASE CLASS A SHARES
----------------- --------------
<S> <C>
Less than $250,000 8 years
$250,000 to less than $500,000 4 years
$500,000 to less than $1,000,000 3 years
</TABLE>
Class C shares are subject to a contingent deferred sales charge on redemptions
made within one year after purchase and an annual distribution fee. Class Z
shares 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.
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 Class A, Class B and Class C service fees and
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.
The per share data is calculated using the average shares outstanding during the
period. In addition, Class A, Class B and Class C net investment income per
share data reflects the service fee per share applicable to Class A, Class B and
Class C shares and the distribution fee applicable to Class B and Class C shares
only.
Class A, 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 service
fee applicable to Class A, Class B and Class C shares and 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 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
10
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(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.
Effective January 1, 2000, the Transfer Agent fee was changed to a fee comprised
of 0.07% annually of average net assets plus charges based on the number of
shareholder accounts and transactions.
UNDERWRITING DISCOUNTS, SERVICE AND DISTRIBUTION FEES:
Liberty Funds Distributor, Inc. (the Distributor), a subsidiary of the Advisor,
is the Fund's principal underwriter. For the six months ended April 30, 2000,
the Fund has been advised that the Distributor retained net underwriting
discounts of $21,232 on sales of the Fund's Class A shares and received
contingent deferred sales charges (CDSC) of $6,792, $824,492 and $4,010 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:
<TABLE>
<CAPTION>
VALUE OF SHARES OUTSTANDING ON THE
20TH OF EACH MONTH WHICH WERE ISSUED ANNUAL FEE RATE
------------------------------------ ---------------
<S> <C>
Prior to April 1, 1989 0.15%
On or after April 1, 1989 0.25%
</TABLE>
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, 2000, purchases and sales of investments,
other than short-term obligations, were $245,172,783 and $344,015,684,
respectively.
Unrealized appreciation (depreciation) at April 30, 2000, based on
cost of investments for both financial statement and federal income tax purposes
was:
<TABLE>
<S> <C>
Gross unrealized appreciation $189,572,862
Gross unrealized depreciation (52,021,757)
------------
Net unrealized appreciation $137,551,105
============
</TABLE>
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 for the
six months ended April 30, 2000.
NOTE 6. OTHER RELATED PARTY TRANSACTIONS
During the six months ended April 30, 2000, the Fund used Alphatrade, a wholly
owned subsidiary of Colonial Management Associated, Inc., as a broker. Total
commissions paid to Alphatrade during the six months were $127,399.
11
<PAGE> 14
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, 2000
CLASS A CLASS B CLASS C CLASS Z
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 21.930 $ 21.100 $ 21.590 $21.960
----------- ---------- -------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (a) (0.003) (0.080) (0.083) 0.024
Net realized and unrealized gain 3.424 3.281 3.354 3.437
----------- ---------- -------- -------
Total from Investment Operations 3.421 3.201 3.271 3.461
----------- ---------- -------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net realized gains (2.271) (2.271) (2.271) (2.271)
----------- ---------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 23.080 $ 22.030 $ 22.590 $23.150
=========== ========== ======== =======
Total return (b)(c) 16.86% 16.44% 16.40% 17.03%
=========== ========== ======== =======
RATIOS TO AVERAGE NET ASSETS
Expenses (d)(e) 1.29% 2.04% 2.04% 1.05%
Net investment income (loss) (d)(e) (0.01)% (0.76)% (0.76)% 0.23%
Portfolio turnover (c) 34% 34% 34% 34%
Net assets at end of period (000) $ 409,166 $ 317,679 $22,523 $1,054
</TABLE>
(a) Per share data was calculated using 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) Not annualized.
(d) The benefits derived from custody credits and directed brokerage
arrangements had no impact.
(e) Annualized.
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31, 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) (0.031) (0.187) (0.191) 0.017
Net realized and unrealized gain (loss) 2.511 2.437 2.501 (0.027)(c)
------------ ------------ ------------ ------------
Total from Investment Operations 2.480 2.250 2.310 (0.010)
------------ ------------ ------------ ------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net realized gains (0.720) (0.720) (0.720) --
------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD $ 21.930 $ 21.100 $ 21.590 $ 21.960
============ ============ ============ ============
Total return (d) 12.48% 11.66% 11.71% (0.05)%(e)
============ ============ ============ ============
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.32% 2.07% 2.07% 1.00%(g)
Net investment income (loss) (f) (0.14)% (0.89)% (0.89)% 0.10%(g)
Portfolio turnover 67% 67% 67% 67%
Net assets at end of period (000) $ 398,255 $ 313,791 $ 21,533 $ 674
</TABLE>
(a) Class Z shares were initially offered on January 11, 1999. Per share data
reflects activity from that date.
(b) Per share data was calculated using 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 repurchase 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.
(g) Annualized.
12
<PAGE> 15
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding
throughout each period are as follows:
<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31
----------------------------------------------------------------------------------
1998 1997
----------------------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C(a)
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 20.430 $ 20.020 $ 20.410 $ 18.040 $ 17.840 $19.860
-------- -------- -------- -------- -------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss (b) (0.047) (0.199) (0.201) (0.002) (0.135) (0.053)
Net realized and unrealized gain 1.637 1.599 1.641 4.575 4.498 0.603(c)
-------- -------- -------- -------- -------- -------
Total from Investment Operations 1.590 1.400 1.440 4.573 4.363 0.550
-------- -------- -------- -------- -------- -------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net realized gains (1.850) (1.850) (1.850) (2.183) (2.183) --
-------- -------- -------- -------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 20.170 $ 19.570 $ 20.000 $ 20.430 $ 20.020 $20.410
======== ======== ======== ======== ======== =======
Total return (d) 7.95% 7.10% 7.17% 28.29% 27.33% 2.77%(e)
======== ======== ======== ======== ======== =======
RATIOS TO AVERAGE NET ASSETS
Expenses (f) 1.32% 2.07% 2.07% 1.03% 1.78% 1.81%(g)
Net investment loss (f) (0.23)% (0.98)% (0.98)% (0.01)% (0.76)% (1.05)%(g)
Portfolio turnover 32% 32% 32% 63% 63% 63%
Net assets at end of period (000) $373,092 $295,025 $ 12,519 $340,479 $192,161 $ 558
</TABLE>
(a) Class C shares were initially offered on August 1, 1997. Per share data
reflects activity from that date.
(b) Per share data was calculated using 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.
(g) Annualized.
13
<PAGE> 16
FINANCIAL HIGHLIGHTS (CONTINUED)
Selected data for a share of each class outstanding
throughout each period are as follows:
<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31
---------------------------------------------------------------------
1996 1995
---------------------------------------------------------------------
CLASS A CLASS B CLASS A CLASS B
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 16.140 $ 16.040 $ 14.020 $ 13.940
------------ ------------ ------------ ------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (a) 0.043 (0.081) 0.174 0.065
Net realized and unrealized gain 3.162 3.129 3.326 3.317
------------ ------------ ------------ ------------
Total from Investment Operations 3.205 3.048 3.500 3.382
------------ ------------ ------------ ------------
LESS DISTRIBUTIONS DECLARED TO SHAREHOLDERS:
From net investment income (0.042) (0.005) (0.165) (0.067)
In excess of net investment income (0.023) (0.003) -- --
From net realized gains (1.240) (1.240) (1.215) (1.215)
------------ ------------ ------------ ------------
Total Distributions Declared to Shareholders (1.305) (1.248) (1.380) (1.282)
------------ ------------ ------------ ------------
NET ASSET VALUE, END OF PERIOD $ 18.040 $ 17.840 $ 16.140 $ 16.040
============ ============ ============ ============
Total return (b) 21.28% 20.31% 28.44% 27.50%
============ ============ ============ ============
RATIOS TO AVERAGE NET ASSETS
Expenses (c) 1.17% 1.92% 1.12% 1.90%
Net investment income (loss) (c) 0.25% (0.50)% 1.24% 0.46%
Portfolio turnover 100% 100% 92% 92%
Net assets at end of period (000) $ 255,911 $ 128,283 $ 194,393 $ 75,283
</TABLE>
(a) Per share data was calculated using 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.
14
<PAGE> 17
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<PAGE> 18
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<PAGE> 19
TRUSTEES & TRANSFER AGENT
------------------------------------------------------------------------------
ROBERT J. BIRNBAUM
Retired (formerly Special Counsel, Dechert, Price & Rhoads; President and Chief
Operating Officer, New York Stock Exchange, Inc.)
TOM BLEASDALE
Retired (formerly Chairman of the Board and Chief Executive Officer, Shore Bank
& Trust Company)
JOHN V. 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
Academic Vice President and Dean of Faculties, Boston College (former Dean,
Boston College School of Management)
THOMAS E. STITZEL
Professor of Finance, College of Business, Boise State University; Business
Consultant and Author
ANNE-LEE VERVILLE
Consultant (formerly General Manager, Global Education Industry, and President,
Applications Solutions Division, IBM Corporation)
------------------------------------------------------------------------------
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
The 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 with the most recent copy of
the Liberty Funds Distributor, Inc. Performance Update.
SEMIANNUAL REPORT:
COLONIAL SELECT VALUE FUND
<PAGE> 20
Liberty offers the independent thinking and collective strength of six financial
specialists. Our distinguished product line helps financial advisors and their
clients build diversified investment portfolios for long-term financial goals.
LIBERTY FUNDS
ALL-STAR Institutional money management approach for individual investors.
COLONIAL Fixed - income and value style equity investing.
CRABBE
HUSON A contrarian approach to fixed - income and equity investing.
NEWPORT A leader in international investing.(SM)
STEIN ROE
ADVISOR Innovative solutions for growth and income investing.
[KEYPORT A leading provider of innovative annuity products.
LOGO]
Liberty's mutual funds are offered by prospectus through Liberty Funds
Distributor, Inc.
BEFORE YOU INVEST, CONSULT YOUR FINANCIAL ADVISOR.
Your financial advisor can help you develop a long-term plan for reaching your
financial goals.
COLONIAL SELECT VALUE FUND SEMIANNUAL REPORT
[Liberty Funds logo]
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One Financial Center, Boston, MA 02111-2621, 1-800-426-3750
www.libertyfunds.com
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