ALLIANCE GROWTH AND INCOME FUND
SEMI-ANNUAL REPORT
APRIL 30, 1998
ALLIANCE CAPITAL
LETTER TO SHAREHOLDERS ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
June 26, 1998
Dear Shareholder:
We are pleased to provide you with an update of Alliance Growth and Income
Fund's performance and market activity for the semi-annual reporting period
ended April 30, 1998.
INVESTMENT PERFORMANCE
The following table shows how your Fund performed in comparison to the
performance of the S&P 500 Stock Index and the Lipper Growth & Income Funds
Average. For the six and 12-month periods ended April 30, 1998 your Fund
outperformed its peer group, the Lipper Growth and Income universe, represented
by the Lipper Growth & Income Funds Average, but did not match the returns of
the S&P 500.
The first six months of the fiscal year were characterized by very high returns
in the stock market. These returns drove stock prices to historically high
valuation measures. At the same time, the strong dollar, tight labor markets
that contribute to upward wage pressures, the export slowdown caused by the
Asian crisis, and increasing corporate spending on the Year 2000 date change
problem, all conspired to put the brakes on earnings growth. Nevertheless, the
market powered onward, driven substantially by money flows from an increasingly
affluent U.S. worker population. We at the Fund are concerned about the
valuation levels of certain groups of stocks, and as a result, we have adopted
a more conservative posture toward the equity market. Bearing in mind the
relationship between risk and reward, one should not expect a fund, like the
Growth and Income Fund, with a more conservative profile than the S&P 500 to
provide returns far in excess of that benchmark in a strong market environment,
and a mild underperformance should not be unexpected either.
INVESTMENT RESULTS*
Periods Ended April 30, 1998
TOTAL RETURNS
6 MONTHS 12 MONTHS
-------- ---------
ALLIANCE GROWTH AND INCOME FUND
Class A 19.32% 40.37%
Class B 19.14% 39.48%
Class C 19.14% 39.01%
S&P 500 STOCK INDEX 22.50% 41.06%
LIPPER GROWTH & INCOME FUNDS AVERAGE 17.38% 36.12%
* THE FUND'S INVESTMENT RESULTS ARE TOTAL RETURNS FOR THE PERIOD AND ARE
BASED ON THE NET ASSET VALUE OF EACH CLASS OF SHARES AS OF APRIL 30, 1998. ALL
FEES AND EXPENSES RELATED TO THE OPERATION OF THE FUND HAVE BEEN DEDUCTED, BUT
NO ADJUSTMENT HAS BEEN MADE FOR SALES CHARGES THAT MAY APPLY WHEN SHARES ARE
PURCHASED OR REDEEMED. TOTAL RETURN FOR ADVISOR CLASS SHARES WILL DIFFER DUE TO
DIFFERENT EXPENSES ASSOCIATED WITH THAT CLASS. PAST PERFORMANCE IS NO GUARANTEE
OF FUTURE RESULTS.
THE UNMANAGED S&P 500 STOCK INDEX INCLUDES 500 U.S. STOCKS AND IS A COMMON
MEASURE OF THE PERFORMANCE OF THE OVERALL U.S. STOCK MARKET. THE UNMANAGED
LIPPER GROWTH & INCOME FUNDS AVERAGE REFLECTS THE PERFORMANCE OF 708 FUNDS FOR
THE SIX-MONTH PERIOD AND 657 FUNDS FOR THE 12-MONTH PERIOD ENDED APRIL 30,
1998. THESE FUNDS HAVE GENERALLY SIMILAR INVESTMENT OBJECTIVES TO ALLIANCE
GROWTH AND INCOME FUND, ALTHOUGH THE INVESTMENT POLICIES OF SOME FUNDS INCLUDED
IN THE AVERAGE MAY VARY. AN INVESTOR CANNOT INVEST DIRECTLY IN THE INDEX OR
AVERAGE.
ADDITIONAL INVESTMENT RESULTS APPEAR ON PAGE 3.
MARKET ENVIRONMENT
The S&P 500 is now trading at a price to earnings (P/E) multiple of about 22-24
times reasonable 1998 operating earnings. During post war periods of analogous
inflation and interest rate dynamics, fiscal and monetary discipline and
competitive positions of domestic corporations, the market multiple was
typically 18-22 times forward earnings. Therefore, if history is a guide, the
S&P 500 is approaching overvaluation.
PORTFOLIO STRATEGY
In this period of potential overvaluation of the market, the Fund emphasizes,
more than ever, its disciplined portfolio approach. Since your Fund invests in
quality
1
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
companies that trade at undeserved discounts to their peers, research and
careful stock selection are emphasized, rather than sector or market timing
bets.
Your Fund has been consistent in its portfolio characteristics of maintaining a
defensive dividend yield and price to earnings ratio, a fully invested posture,
and a high degree of sector and industry diversification. We continue to seek
the stocks of companies with primarily secular growth potential combined with
reasonable valuation. Finally, we rely on Alliance's internal research
capabilities in selecting stocks that we expect to deliver superior performance.
Thank you for your continued interest and investment in Alliance Growth and
Income Fund. We look forward to reporting to you again on market activity and
the Fund's investment results in the future.
Sincerely,
John D. Carifa
Chairman and President
Paul Rissman
Senior Vice President
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, GUARANTEED OR ENDORSED
BY, ANY BANK; FURTHER, SUCH SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
SHARES OF THE FUND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL.
2
INVESTMENT OBJECTIVE AND POLICIES ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
Alliance Growth and Income Fund seeks to provide income and appreciation. The
Fund invests principally in a diversified portfolio of dividend-paying common
stocks of good quality, and, under certain market conditions, other types of
securities, including bonds, convertible bonds and preferred stocks.
INVESTMENT RESULTS
_______________________________________________________________________________
NAV AND SEC AVERAGE ANNUAL TOTAL RETURNS AS OF APRIL 30, 1998
CLASS A SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 40.37% 34.50%
Five Years 20.88% 19.82%
Ten Years 16.68% 16.16%
CLASS B SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 39.48% 35.48%
Five Years 19.96% 19.96%
Since Inception* 16.33% 16.33%
CLASS C SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 39.01% 38.01%
Five Years 19.95% 19.95%
Since Inception* 19.95% 19.95%
SEC AVERAGE ANNUAL TOTAL RETURNS
AS OF THE MOST RECENT QUARTER-END (MARCH 31, 1998)
CLASS A CLASS B CLASS C
------- ------- -------
1 Year 36.39% 37.57% 40.08%
5 Years 19.04% 19.05% n/a
10 Years 16.33% n/a n/a
The Fund's investment results represent average annual total returns. The NAV
and SEC returns reflect reinvestment of dividends and/or capital gains
distributions in additional shares without (NAV) and with (SEC) the effect of
the 4.25% maximum front-end sales charge for Class A or applicable contingent
deferred sales charge for Class B (4% year 1, 3% year 2, 2% year 3, 1% year 4);
and for Class C shares (1% year 1). Returns for Class A shares do not reflect
the imposition of the 1 year 1% contingent deferred sales charge for accounts
over $1,000,000. Total return for Advisor Class shares will differ due to
different expenses associated with that class.
SEC average annual total returns for the periods shown reflect reinvestment of
all distributions and deduction of the maximum 4.25% front-end sales charges
and applicable contingent deferred sales charges.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
* Inception: 2/8/91, Class B; 5/3/93, Class C.
n/a: not applicable.
3
TEN LARGEST HOLDINGS
APRIL 30, 1998 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
PERCENT OF
COMPANY VALUE NET ASSETS
- -------------------------------------------------------------------------------
Chase Manhattan Corp. $ 82,860,375 4.6%
Bristol-Myers Squibb Co. 53,678,625 3.0
United Technologies Corp. 53,362,969 3.0
Texaco, Inc. 52,767,000 2.9
Citicorp 50,568,000 2.8
USX-Marathon Group 45,840,000 2.6
First Data Corp. 43,393,875 2.4
RJR Nabisco Holdings Corp. 42,135,937 2.4
Avon Products, Inc. 39,450,000 2.2
Tyco International, Ltd. 37,060,000 2.1
$ 501,116,781 28.0%
MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED APRIL 30, 1998 (UNAUDITED)
_______________________________________________________________________________
SHARES*
- -------------------------------------------------------------------------------
HOLDINGS
PURCHASES BOUGHT 4/30/98
- -------------------------------------------------------------------------------
A.H. Belo Corp. Series A 421,000 421,000
Avon Products, Inc. 480,000 480,000
Bristol-Myers Squibb Co. 507,000 507,000
Citicorp 336,000 336,000
Eastman Kodak Co. 410,000 410,000
Federal National Mortgage Assn. 535,600 535,600
Household International, Inc. 200,000 258,000
MCI Communications Corp. 500,000 500,000
Union Pacific Capital Trust cv. pfd. 444,000 444,000
United Technologies Corp. 298,100 542,100
HOLDINGS
SALES SOLD 4/30/98
- -------------------------------------------------------------------------------
Anheuser Busch Cos., Inc. 550,000 -0-
Campbell Soup Co. 560,000 368,000
Cisco Systems, Inc. 126,850 271,450
Du Pont E.I. de Nemours & Co. 411,000 -0-
General Electric Co. 275,800 -0-
Heinz (H.J.) Co. 375,000 -0-
Intel Corp. 242,400 -0-
Morgan Stanley, Dean Witter,
Discover and Co. 475,000 225,000
Schering-Plough Corp. 265,000 249,000
Sears, Roebuck & Co. 420,000 -0-
* Adjusted for stock splits.
4
PORTFOLIO OF INVESTMENTS
APRIL 30, 1998 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCKS & OTHER INVESTMENTS-96.2%
FINANCE-19.9%
BANKING - MONEY CENTER-7.5%
Chase Manhattan Corp. 598,000 $ 82,860,375
Citicorp 336,000 50,568,000
------------
133,428,375
BANKING - REGIONAL-2.0%
First Union Corp. 600,000 36,225,000
BROKERAGE & MONEY MANAGEMENT-1.0%
Morgan Stanley, Dean Witter and Co. 225,000 17,746,875
INSURANCE-2.4%
American International Group, Inc. 134,000 17,629,375
Hartford Life, Inc. Cl.A 175,000 8,651,562
Travelers Group, Inc. 142,500 8,719,219
Travelers Property Casualty Corp. Cl.A 191,900 8,059,800
------------
43,059,956
MORTGAGE BANKING-1.8%
Federal National Mortgage Assn. 535,600 32,069,050
Security Capital Group, Inc.
warrants, expiring 9/18/98 12,627 35,513
------------
32,104,563
REAL ESTATE-1.4%
American General Hospitality Corp. 23,900 598,994
Arden Realty Group, Inc. 31,900 895,194
Avalon Properties, Inc. 22,400 630,000
Bay Apartment Communities, Inc. 10,300 381,100
Boston Properties, Inc. 13,200 436,425
Brandywine Realty Trust 36,100 821,275
Brookfield Properties Corp. (a)(b) 10,000 165,041
Cabot Industrial Trust 20,900 472,863
Correctional Properties Trust (a) 20,100 463,556
Crescent Real Estate Equities Co. 28,700 979,387
Duke Realty Investments, Inc. 24,500 583,406
Entertainment Properties Trust 25,800 507,938
Equity Office Properties Trust 41,700 1,185,844
Essex Property Trust, Inc. 28,800 950,400
Excel Legacy Corp. (a) 20,600 108,794
Excel Realty Trust, Inc. 18,600 497,550
Glenborough Realty Trust, Inc. 36,300 973,294
Golf Trust of America, Inc. 21,700 707,962
Great Lakes REIT, Inc. 17,000 311,313
Highwoods Properties, Inc. 26,200 890,800
Innkeepers USA Trust 42,100 636,763
IRT Property Co. (a) 6,000 69,750
Macerich Co. 27,400 768,912
Mack-Cali Realty Corp. 20,700 777,544
Meridian Industrial Trust, Inc. 7,800 180,375
Mills Corp. 28,300 705,731
Pacific Retail Trust Co. 40,000 520,000
Pan Pacific Retail Properties, Inc. 46,800 991,575
Patriot American Hospitality, Inc. 41,000 1,035,250
Public Storage, Inc. 34,600 1,063,950
Reckson Associates Realty Corp. 31,200 764,400
Security Capital Industrial Trust 33,000 806,437
Security Capital Pacific Trust 37,400 836,825
SL Green Realty Corp. 41,900 1,005,600
Spieker Properties, Inc. 21,700 859,862
5
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
Starwood Hotels & Resorts 25,000 $ 1,254,687
Sunstone Hotel Investors, Inc. 40,500 627,750
------------
25,466,547
MISCELLANEOUS-3.8%
Household International, Inc. 258,000 33,910,875
MBNA Corp. 510,000 17,276,250
PMI Group, Inc. 201,547 16,375,694
------------
67,562,819
------------
355,594,135
ENERGY-13.2%
DOMESTIC INTEGRATED-2.6%
USX-Marathon Group 1,280,000 45,840,000
DOMESTIC PRODUCERS-2.2%
Apache Corp. 633,000 22,392,375
Murphy Oil Corp. 242,000 12,447,875
Union Pacific Resources Group, Inc. 209,400 4,999,425
------------
39,839,675
INTERNATIONAL-4.8%
Mobil Corp. 420,000 33,180,000
Texaco, Inc. 858,000 52,767,000
------------
85,947,000
OIL SERVICE-3.1%
BJ Services Co. (a) 193,000 7,237,500
Dresser Industries, Inc. 390,000 20,621,250
Noble Drilling Corp. (a) 290,000 9,370,625
Transocean Offshore, Inc. 330,000 18,438,750
------------
55,668,125
MISCELLANEOUS-0.5%
AES Corp. (a) 153,300 8,460,244
------------
235,755,044
CONSUMER SERVICES-12.3%
AIRLINES-0.9%
Delta Air Lines, Inc. 139,000 16,158,750
APPAREL-0.7%
Nautica Enterprises, Inc. (a) 500,000 12,421,875
BROADCASTING & CABLE-1.2%
A.H. Belo Corp. Series A 421,000 22,286,687
ENTERTAINMENT & LEISURE-4.7%
CSC Holdings, Inc.
8.5% series L cumulative
convertible pfd. 595,000 28,560,000
Eastman Kodak Co. 410,000 29,596,875
Harley-Davidson, Inc. 500,000 18,000,000
Mirage Resorts, Inc. (a) 320,000 7,060,000
------------
83,216,875
PRINTING & PUBLISHING-1.5%
Donnelley (R.R.) & Sons Co. 420,000 18,506,250
Gannett Co., Inc. 132,000 8,967,750
------------
27,474,000
RETAIL - GENERAL MERCHANDISE-3.3%
Dayton Hudson Corp. 327,000 28,551,188
Home Depot, Inc. 394,000 27,432,250
Staples, Inc. (a) 103,800 2,565,806
------------
58,549,244
------------
220,107,431
HEALTH CARE-11.4%
BIOTECHNOLOGY-1.0%
Centocor, Inc. (a) 251,100 10,577,587
Genzyme Corp. (a) 240,000 7,417,500
------------
17,995,087
DRUGS-5.9%
Bristol-Myers Squibb Co. 507,000 53,678,625
Merck & Co., Inc. 265,800 32,028,900
Schering-Plough Corp. 249,000 19,951,125
------------
105,658,650
6
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
MEDICAL SERVICES-4.5%
Columbia HCA/Healthcare Corp. 780,000 $ 25,691,250
PacifiCare Health Systems, Inc. Cl.B (a) 383,000 27,480,250
United Healthcare Corp. 388,500 27,292,125
------------
80,463,625
------------
204,117,362
TECHNOLOGY-10.9%
COMMUNICATION EQUIPMENT-0.3%
Scientific-Atlanta, Inc. 260,000 6,207,500
COMPUTER HARDWARE-2.1%
Compaq Computer Corp. 741,000 20,794,312
Hewlett-Packard Co. 217,000 16,342,813
------------
37,137,125
COMPUTER SERVICES-3.5%
Electronic Data Systems Corp. 440,300 18,932,900
First Data Corp. 1,281,000 43,393,875
------------
62,326,775
NETWORKING SOFTWARE-1.7%
Ascend Communications, Inc. (a) 220,000 9,576,875
Cisco Systems, Inc. (a) 271,450 19,892,195
------------
29,469,070
SEMI-CONDUCTOR COMPONENTS-2.3%
Altera Corp. (a) 65,200 2,638,563
Atmel Corp. (a) 1,033,000 20,821,406
Xilinx, Inc. (a) 405,000 18,516,094
------------
41,976,063
MISCELLANEOUS-1.0%
Solectron Corp. (a) 398,000 17,636,375
------------
194,752,908
CONSUMER STAPLES-8.2%
COSMETICS-2.2%
Avon Products, Inc. 480,000 39,450,000
FOOD-2.0%
Campbell Soup Co. 368,000 18,883,000
Tyson Foods, Inc. Cl.A 400,000 7,725,000
Vlasic Foods International, Inc. (a) 36,800 848,700
Whitman Corp. 430,000 8,411,875
------------
35,868,575
TOBACCO-4.0%
Philip Morris Cos., Inc. 777,250 29,001,141
RJR Nabisco Holdings Corp. 1,515,000 42,135,937
------------
71,137,078
------------
146,455,653
UTILITIES-8.1%
ELECTRIC & GAS UTILITY-3.7%
CMS Energy Corp. 455,000 19,877,813
Consolidated Edison, Inc. 158,300 7,163,075
FPL Group, Inc. 383,000 23,769,937
NIPSCO Industries, Inc. 248,000 6,649,500
Pinnacle West Capital Corp. 195,000 8,628,750
------------
66,089,075
TELEPHONE UTILITY-4.4%
AT&T Corp. 283,500 17,027,719
MCI Communications Corp. 500,000 25,140,625
Teleport Communications
Group, Inc. Cl.A (a) 300,300 16,197,431
WorldCom, Inc. 460,000 19,679,375
------------
78,045,150
------------
144,134,225
CAPITAL GOODS-4.6%
ENGINEERING & CONSTRUCTION-0.6%
Fluor Corp. 210,000 9,922,500
MACHINERY-1.0%
Cooper Industries, Inc. 270,000 18,056,250
7
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
MISCELLANEOUS-3.0%
United Technologies Corp. 542,100 $ 53,362,969
------------
81,341,719
MULTI INDUSTRY COMPANIES-3.0%
Tyco International, Ltd. 680,000 37,060,000
U.S. Industries, Inc. 628,500 17,048,062
------------
54,108,062
BASIC INDUSTRY-2.3%
CHEMICALS-1.8%
Dow Chemical Co. 180,000 17,403,750
Praxair, Inc. 300,000 15,093,750
------------
32,497,500
CONTAINERS-0.5%
Sealed Air Corp. (a) 145,000 9,089,688
------------
41,587,188
TRANSPORTATION-1.6%
RAILROADS-1.6%
Canadian Pacific, Ltd. (b) 165,000 4,857,188
Union Pacific Capital Trust
6.25%, 4/01/28
cv. pfd. (c) 444,000 23,254,500
------------
28,111,688
AEROSPACE & DEFENSE-0.7%
AEROSPACE-0.7%
General Dynamics Corp. 307,000 12,970,750
CONSUMER MANUFACTURING-0.0%
APPLIANCES-0.0%
Sunbeam Corp. 32,000 804,000
PRINCIPAL
AMOUNT
COMPANY (000) VALUE
- -------------------------------------------------------------------------
Total Common Stocks &
Other Investments
(cost $1,399,508,442) $ 1,719,840,165
CONVERTIBLE BOND-0.7%
Federated Department Stores, Inc.
5.00%, 10/01/03
(cost $9,170,000) $ 8,000 11,940,000
COMMERCIAL PAPER-3.3%
American Express Credit Corp.
5.44%, 5/04/98 6,800 6,796,917
5.47%, 5/01/98 7,900 7,900,000
5.51%, 5/06/98 5,000 4,996,174
Ford Motor Credit Corp.
5.50%, 5/06/98 3,400 3,397,403
5.51%, 5/05/98 9,400 9,394,245
5.51%, 5/08/98 10,000 9,989,286
Prudential Funding Corp.
5.50%, 5/11/98 7,300 7,288,847
5.51%, 5/12/98 5,000 4,991,582
5.52%, 5/13/98 4,000 3,992,640
Total Commercial Paper
(amortized cost $58,747,094) 58,747,094
TOTAL INVESTMENTS-100.2%
(cost $1,467,425,536) 1,790,527,259
Other assets less liabilities-(0.2%) (2,744,736)
NET ASSETS-100% $ 1,787,782,523
(a) Non-income producing security.
(b) Country of origin--Canada.
(c) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At April 30, 1998,
these securities amounted to $23,254,500 or 1.3% of net assets.
See notes to financial statements.
8
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1998 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $1,467,425,536) $ 1,790,527,259
Cash 29,063
Receivable for investment securities sold 10,348,675
Receivable for capital stock sold 6,088,633
Dividends and interest receivable 1,082,596
Other assets 75,673
Total assets 1,808,151,899
LIABILITIES
Payable for investment securities purchased 17,470,685
Payable for capital stock redeemed 959,361
Distribution fee payable 840,305
Advisory fee payable 691,058
Accrued expenses and other liabilities 407,967
Total liabilities 20,369,376
NET ASSETS $ 1,787,782,523
COMPOSITION OF NET ASSETS
Capital stock, at par $ 4,986,365
Additional paid-in capital 1,320,307,159
Distribution in excess of net investment income (2,898,850)
Accumulated net realized gain on investment transactions 142,299,948
Net unrealized appreciation of investments and other assets 323,087,901
$ 1,787,782,523
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share ($966,167,324/
268,278,773 shares of capital stock issued and outstanding) $3.60
Sales charge--4.25% of public offering price .16
Maximum offering price $3.76
CLASS B SHARES
Net asset value and offering price per share ($666,922,802/
187,028,874 shares of capital stock issued and outstanding) $3.57
CLASS C SHARES
Net asset value and offering price per share ($150,335,470/
42,119,117 shares of capital stock issued and outstanding) $3.57
ADVISOR CLASS SHARES
Net asset value, redemption and offering price per share
($4,356,927/1,209,713 shares of capital stock issued and
outstanding) $3.60
See notes to financial statements.
9
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1998 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
INVESTMENT INCOME
Dividends (net of foreign taxes withheld
of $4,178) $ 12,418,769
Interest 1,608,076 $ 14,026,845
EXPENSES
Advisory fee 3,650,673
Distribution fee - Class A 949,526
Distribution fee - Class B 2,692,472
Distribution fee - Class C 625,591
Transfer agency 865,527
Printing 117,112
Custodian 114,086
Registration 84,950
Administrative 62,620
Audit and legal 61,595
Taxes 36,602
Directors' fees 14,899
Miscellaneous 6,316
Total expenses 9,281,969
Net investment income 4,744,876
REALIZED AND UNREALIZED GAIN ON INVESTMENT
TRANSACTIONS
Net realized gain on investment transactions 140,643,216
Net change in unrealized appreciation of
investments and other assets 125,822,580
Net gain on investments 266,465,796
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 271,210,672
See notes to financial statements.
10
STATEMENT OF CHANGES IN NET ASSETS ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31,
(UNAUDITED) 1997
--------------- ---------------
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 4,744,876 $ 11,804,363
Net realized gain on investment
transactions 140,643,216 187,140,969
Net change in unrealized appreciation of
investments and other assets 125,822,580 91,558,026
Net increase in net assets from operations 271,210,672 290,503,358
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (5,491,282) (10,304,349)
Class B (1,721,701) (3,192,222)
Class C (404,099) (778,427)
Advisor Class (26,644) (26,635)
Net realized gain on investments
Class A (104,156,500) (69,814,848)
Class B (62,542,206) (30,538,252)
Class C (14,674,879) (7,901,806)
Advisor Class (419,910) (45,499)
CAPITAL STOCK TRANSACTIONS
Net increase 352,311,047 335,939,551
Total increase 434,084,498 503,840,871
NET ASSETS
Beginning of year 1,353,698,025 849,857,154
End of period $ 1,787,782,523 $ 1,353,698,025
See notes to financial statements
11
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1998 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Growth and Income Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 as a diversified, open-end management investment
company. The Fund offers Class A, Class B, Class C and Advisor Class shares.
Class A shares are sold with a front-end sales charge of up to 4.25% for
purchases not exceeding $1,000,000. With respect to purchases of $1,000,000 or
more, Class A shares redeemed within one year of purchase will be subject to a
contingent deferred sales charge of 1%. Class B shares are currently sold with
a contingent deferred sales charge which declines from 4% to zero depending on
the period of time the shares are held. Class B shares will automatically
convert to Class A shares eight years after the end of the calendar month of
purchase. Class C shares are subject to a contingent deferred sales charge of
1% on redemptions made within the first year after purchase. Advisor Class
shares are sold without an initial or contingent deferred sales charge and are
not subject to ongoing distribution expenses. Advisor Class shares are offered
to investors participating in fee-based programs and to certain retirement plan
accounts. All four classes of shares have identical voting, dividend,
liquidation and other rights, except that each class bears different
distribution expenses and has exclusive voting rights with respect to its
distribution plan. The financial statements have been prepared in conformity
with generally accepted accounting principles which require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities in the financial statements and amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange or on a foreign
securities exchange (other than foreign securities exchanges whose operations
are similar to those of the United States over-the-counter market) are
generally valued at the last reported sales price or if no sale occurred, at
the mean of the closing bid and asked prices on that day. Readily marketable
securities traded in the over-the-counter market, securities listed on a
foreign securities exchange whose operations are similar to the U.S.
over-the-counter market, and securities listed on a national securities
exchange whose primary market is believed to be over-the-counter, are valued at
the mean of the current bid and asked price. U.S. government and fixed income
securities which mature in 60 days or less are valued at amortized cost, unless
this method does not represent fair value. Securities for which current market
quotations are not readily available are valued at their fair value as
determined in good faith by, or in accordance with procedures adopted by, the
Board of Directors. Fixed income securities may be valued on the basis of
prices obtained from a pricing service when such prices are believed to reflect
the fair market value of such securities.
2. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the date securities are
purchased or sold. The Fund accretes discounts as adjustments to interest
income. Investment gains and losses are determined on the identified cost basis.
4. INCOME AND EXPENSES
All income earned and expenses incurred by the Fund are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that the Fund's
Class B and Class C shares bear higher distribution and transfer agent fees
than Class A shares and the Advisor Class shares have no distribution fees.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date.
Income dividends and capital gains distributions are determined in accordance
with federal tax regulations and may differ from those determined in accordance
with generally accepted accounting principles. To the extent
12
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
these differences are permanent, such amounts are reclassified within the
capital accounts based on their federal tax basis treatment; temporary
differences do not require such reclassification.
NOTE B: ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an advisory agreement, the Fund pays Alliance Capital
Management L.P. (the "Adviser"), an advisory fee at an annual rate of .625% of
the first $200 million, .50% of the next $200 million and .45% in excess of
$400 million of the average daily net assets of the Fund. Such fee is accrued
daily and paid monthly.
Pursuant to the advisory agreement, the Fund paid $62,620 to the Adviser
representing the cost of certain legal and accounting services provided to the
Fund by the Adviser for the six months ended April 30, 1998.
The Fund compensates Alliance Fund Services, Inc., a wholly-owned subsidiary of
the Adviser, under a Transfer Agency Agreement for providing personnel and
facilities to perform transfer agency services for the Fund. Such compensation
amounted to $641,358 for the six months ended April 30, 1998.
Alliance Fund Distributors, Inc., (the "Distributor"), a wholly-owned
subsidiary of the Adviser, serves as the Distributor of the Fund's shares. The
Distributor received front-end sales charges of $100,916 from the sales of
Class A shares and $10,739, $315,742 and $20,034 in contingent deferred sales
charges imposed upon redemptions by shareholders of Class A, Class B and Class
C shares, respectively, for the six months ended April 30, 1998.
Brokerage commissions paid on investment transactions for the six months ended
April 30, 1998 amounted to $1,513,217, of which $3,115 was paid to Donaldson,
Lufkin & Jenrette Securities Corp., an affiliate of the Adviser.
NOTE C: DISTRIBUTION SERVICES AGREEMENT
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, the Fund pays a distribution fee to the Distributor at an annual
rate of up to .30% of the Fund's average daily net assets attributable to Class
A shares and 1% of the average daily net assets attributable to both Class B
and Class C shares. There is no distribution fee on the Advisor Class shares.
The fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution
assistance and promotional activities. The Distributor has incurred expenses in
excess of the distribution costs reimbursed by the Fund in the amount of
$15,568,427 and $1,565,787 for Class B and Class C shares, respectively; such
costs may be recovered from the Fund in future periods so long as the Agreement
is in effect. In accordance with the Agreement, there is no provision for
recovery of unreimbursed distribution costs incurred by the Distributor beyond
the current fiscal year for Class A shares.
The Agreement also provides that the Adviser may use its own resources to
finance the distribution of the Fund's shares.
NOTE D: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments
and U.S. government securities) aggregated $742,836,447 and $619,514,159,
respectively, for the six months ended April 30, 1998. There were purchases of
$30,393,798 and no sales of U.S. government and government agency securities
for the six months ended April 30, 1998.
At April 30, 1998, the cost of investments for federal income tax purposes was
substantially the same as the cost for financial reporting purposes.
Accordingly, gross unrealized appreciation of investments was $341,696,450 and
gross unrealized depreciation of investments was $18,594,727 resulting in net
unrealized appreciation of $323,101,723. The Fund may be able to use up to
$1,445,718 of Alliance Convertible Fund's (which was
13
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
acquired in 1991) capital loss carryforward, to offset future realized gains
which expires in 1998. During the year ended October 31, 1997, the Fund
utilized $1,445,718 of capital loss carryforward.
1. OPTION TRANSACTIONS
For hedging purposes, the Fund purchases and writes (sells) put and call
options on U.S. and foreign government securities and foreign currencies that
are traded on U.S. and foreign securities exchanges and over-the-counter
markets.
The risk associated with purchasing an option is that the Fund pays a premium
whether or not the option is exercised. Additionally, the Fund bears the risk
of loss of premium and change in market value should the counterparty not
perform under the contract. Put and call options purchased are accounted for in
the same manner as portfolio securities. The cost of securities acquired
through the exercise of call options is increased by premiums paid. The
proceeds from securities sold through the exercise of put options are decreased
by the premiums paid.
When the Fund writes an option, the premium received by the Fund is recorded as
a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from writing options which expire unexercised
are recorded by the Fund on the expiration date as realized gains from option
transactions. The difference between the premium received and the amount paid
on effecting a closing purchase transaction, including brokerage commissions,
is also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a call
option is exercised, the premium received is added to the proceeds from the
sale of the underlying security or currency in determining whether the Fund has
realized a gain or loss. If a put option is exercised, the premium received
reduces the cost basis of the security or currency purchased by the Fund. The
risk involved in writing an option is that, if the option was exercised the
underlying security could then be purchased or sold by the Fund at a
disadvantageous price.
For the six months ended April 30, 1998, the Fund did not engage in any option
transactions.
NOTE E: CAPITAL STOCK
There are 12,000,000,000 shares of $0.01 par value capital stock authorized,
divided into four classes, designated Class A, Class B, Class C and Advisor
Class shares. Class A consists of 3,000,000,000 shares, Class B of
3,000,000,000, Class C of 3,000,000,000 and Advisor Class of 3,000,000,000.
Transactions in capital stock were as follows:
SHARES AMOUNT
--------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, APRIL 30, 1998 OCTOBER 31,
(UNAUDITED) 1997 (UNAUDITED) 1997
------------ ------------ -------------- --------------
CLASS A
Shares sold 38,736,675 43,288,597 $ 132,669,510 $ 142,221,081
Shares issued in
reinvestment of
dividends and
distributions 28,618,711 20,847,869 89,495,393 60,706,640
Shares converted
from Class B 4,470,544 6,451,809 15,363,352 21,180,500
Shares redeemed (29,988,033) (28,296,289) (102,977,225) (90,979,316)
Net increase 41,837,897 42,291,986 $ 134,551,030 $ 133,128,905
14
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SHARES AMOUNT
--------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, APRIL 30, 1998 OCTOBER 31,
(UNAUDITED) 1997 (UNAUDITED) 1997
------------ ------------ -------------- --------------
CLASS B
Shares sold 51,843,172 66,784,549 $ 175,771,051 $ 213,984,586
Shares issued in
reinvestment
of dividends and
distributions 19,368,593 9,723,395 59,919,316 28,200,000
Shares converted
to Class A (4,512,265) (6,490,215) (15,363,352) (21,180,500)
Shares redeemed (11,935,563) (16,514,449) (40,335,236) (53,237,363)
Net increase 54,763,937 53,503,280 $ 179,991,779 $ 167,766,723
CLASS C
Shares sold 14,906,651 14,640,703 $ 51,143,915 $ 46,769,033
Shares issued in
reinvestment of
dividends and
distributions 4,561,226 2,362,593 14,110,658 6,851,659
Shares redeemed (8,197,484) (6,677,129) (28,406,369) (21,392,727)
Net increase 11,270,393 10,326,167 $ 36,848,204 $ 32,227,965
ADVISOR CLASS
Shares sold 876,912 2,631,151 $ 3,112,158 $ 9,238,958
Shares issued in
reinvestment of
dividends and
distributions 133,854 22,536 418,986 67,922
Shares redeemed (723,574) (1,760,224) (2,611,110) (6,490,922)
Net increase 287,192 893,463 $ 920,034 $ 2,815,958
15
FINANCIAL HIGHLIGHTS ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 1998 ---------------------------------------------------------------
(UNAUDITED) 1997 1996 1995 1994 1993
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 3.48 $ 3.00 $ 2.71 $ 2.35 $ 2.61 $ 2.48
INCOME FROM INVESTMENT OPERATIONS
Net investment income .02(a) .04(a) .05 .02 .06 .06
Net realized and unrealized gain (loss)
of investment transactions .58 .87 .50 .52 (.08) .29
Net increase (decrease) in net asset
value from operations .60 .91 .55 .54 (.02) .35
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.02) (.05) (.05) (.06) (.06) (.06)
Distributions from net realized gains (.46) (.38) (.21) (.12) (.18) (.16)
Total dividends and distributions (.48) (.43) (.26) (.18) (.24) (.22)
Net asset value, end of period $ 3.60 $ 3.48 $ 3.00 $ 2.71 $ 2.35 $ 2.61
TOTAL RETURN
Total investment return based on net
asset value (b) 19.32% 33.28% 21.51% 24.21% (.67)% 14.98%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $966,167 $787,566 $553,151 $458,158 $414,386 $459,372
Ratio of expenses to average net assets .88%(c) .92%(d) .97% 1.05% 1.03% 1.07%
Ratio of net investment income to
average net assets .97%(c) 1.39% 1.73% 1.88% 2.36% 2.38%
Portfolio turnover rate 41% 88% 88% 142% 68% 91%
</TABLE>
See footnote summary on page 19.
16
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CLASS B
------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 1998 ---------------------------------------------------------------
(UNAUDITED) 1997 1996 1995 1994 1993
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 3.45 $ 2.99 $ 2.69 $ 2.34 $ 2.60 $ 2.47
INCOME FROM INVESTMENT OPERATIONS
Net investment income -0-(a) .02(a) .03 .01 .04 .05
Net realized and unrealized gain (loss)
of investment transactions .59 .85 .51 .49 (.08) .28
Net increase (decrease) in net asset
value from operations .59 .87 .54 .50 (.04) .33
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.01) (.03) (.03) (.03) (.04) (.04)
Distributions from net realized gains (.46) (.38) (.21) (.12) (.18) (.16)
Total dividends and distributions (.47) (.41) (.24) (.15) (.22) (.20)
Net asset value, end of period $ 3.57 $ 3.45 $ 2.99 $ 2.69 $ 2.34 $ 2.60
TOTAL RETURN
Total investment return based on net
asset value (b) 19.14% 31.83% 21.20% 22.84% (1.50)% 14.22%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $666,923 $456,399 $235,263 $136,758 $102,546 $76,633
Ratio of expenses to average net assets 1.66%(c) 1.72%(d) 1.78% 1.86% 1.85% 1.90%
Ratio of net investment income to
average net assets .18%(c) .56% .91% 1.05% 1.56% 1.58%
Portfolio turnover rate 41% 88% 88% 142% 68% 91%
</TABLE>
See footnote summary on page 19.
17
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CLASS C
------------------------------------------------------------------------------
SIX MONTHS MAY 3, 1993(E)
ENDED YEAR ENDED OCTOBER 31, TO
APRIL 30, 1998 -------------------------------------------------- OCTOBER 31,
(UNAUDITED) 1997 1996 1995 1994 1993
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 3.45 $ 2.99 $ 2.70 $ 2.34 $ 2.60 $ 2.43
INCOME FROM INVESTMENT OPERATIONS
Net investment income -0-(a) .02(a) .03 .01 .04 .02
Net realized and unrealized gain (loss)
on investment transactions .59 .85 .50 .50 (.08) .17
Net increase (decrease) in net asset
value from operations .59 .87 .53 .51 (.04) .19
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.01) (.03) (.03) (.03) (.04) (.02)
Distributions from net realized gains (.46) (.38) (.21) (.12) (.18) -0-
Total dividends and distributions (.47) (.41) (.24) (.15) (.22) (.02)
Net asset value, end of period $ 3.57 $ 3.45 $ 2.99 $ 2.70 $ 2.34 $ 2.60
TOTAL RETURN
Total investment return based on net
asset value (b) 19.14% 31.83% 20.72% 23.30% (1.50)% 7.85%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $150,335 $106,526 $61,356 $35,835 $19,395 $7,774
Ratio of expenses to average net assets 1.66%(c) 1.71%(d) 1.76% 1.84% 1.84% 1.96%(c)
Ratio of net investment income to
average net assets .18%(c) .58% .93% 1.04% 1.61% 1.45%(c)
Portfolio turnover rate 41% 88% 88% 142% 68% 91%
</TABLE>
See footnote summary on page 19.
18
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
ADVISOR CLASS
------------------------------------
SIX MONTHS OCTOBER 2,
ENDED YEAR ENDED 1996(E) TO
APR. 30, 1998 OCT. 31, OCT. 31,
(UNAUDITED) 1997 1996
----------- ----------- -----------
<S> <C> <C> <C>
Net asset value, beginning of period $ 3.48 $ 3.00 $ 2.97
INCOME FROM INVESTMENT OPERATIONS
Net investment income .02(a) .05(a) -0-
Net realized and unrealized gain
on investment transactions .59 .87 .03
Net increase in net asset
value from operations .61 .92 .03
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.03) (.06) -0-
Distributions from net realized gains (.46) (.38) -0-
Total dividends and distributions (.49) (.44) -0-
Net asset value, end of period $ 3.60 $ 3.48 $ 3.00
TOTAL RETURN
Total investment return based on
net asset value (b) 19.45% 33.61% 1.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $4,357 $3,207 $87
Ratio of expenses to average net assets .66%(c) .71%(d) .37%(c)
Ratio of net investment income to
average net assets 1.16%(c) 1.42% 3.40%(c)
Portfolio turnover rate 41% 88% 88%
</TABLE>
(a) Based on average shares outstanding.
(b) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distribution at net asset value during the period, and redemption
on the last day of the period. Initial sales charges or contingent deferred
sales charges are not reflected in the calculation of total investment return.
Total investment return calculated for a period of less than one year is not
annualized.
(c) Annualized.
(d) Ratio reflects expenses grossed up for expense offset arrangement with the
transfer agent. For the year ended October 31, 1997, the ratio of expenses to
average net assets was .91%, 1.71%, 1.70% and .70% for Class A, B, C and
Advisor Class shares, respectively.
(e) Commencement of distribution.
19
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN AND PRESIDENT
RUTH BLOCK (1)
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
WILLIAM H. FOULK, JR. (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
DONALD J. ROBINSON (1)
OFFICERS
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
PAUL C. RISSMAN, SENIOR VICE PRESIDENT
THOMAS J. BARDONG, VICE PRESIDENT
DANIEL V. PARKER, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
VINCENT S. NOTO, CONTROLLER
CUSTODIAN
STATE STREET BANK & TRUST COMPANY
225 Franklin Street
Boston, MA 02110
PRINCIPAL UNDERWRITER
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-Free 1-(800)-221-5672
INDEPENDENT ACCOUNTANTS
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, NY 10036
(1) Member of the Audit Committee.
The financial information included herein is taken from the records of the
Fund without audit by independent accountants who do not express an opinion
thereon.
20
THE ALLIANCE FAMILY OF MUTUAL FUNDS
_______________________________________________________________________________
FIXED INCOME
Alliance Bond Fund
U.S. Government Portfolio
Corporate Bond Portfolio
Alliance Global Dollar Government Fund
Alliance Global Strategic Income Trust
Alliance High Yield Fund
Alliance Mortgage Securities Income Fund
Alliance Limited Maturity Government Fund
Alliance Multi-Market Strategy Trust
Alliance North American Government Income Trust
Alliance Short-Term Multi-Market Trust
Alliance Short-Term U.S. Government Fund
Alliance World Income Trust
TAX-FREE INCOME
Alliance Municipal Income Fund
California Portfolio
Insured California Portfolio
Insured National Portfolio
National Portfolio
New York Portfolio
Alliance Municipal Income Fund II
Arizona Portfolio
Florida Portfolio
Massachusetts Portfolio
Michigan Portfolio
Minnesota Portfolio
New Jersey Portfolio
Ohio Portfolio
Pennsylvania Portfolio
Virginia Portfolio
MONEY MARKET
AFD Exchange Reserves
GROWTH
The Alliance Fund
Alliance Global Environment Fund
Alliance Growth Fund
Alliance Premier Growth Fund
Alliance/Regent Sector Opportunity Fund
GROWTH & INCOME
Alliance Strategic Balanced Fund
Alliance Balanced Shares
Alliance Conservative Investors Fund
Alliance Growth & Income Fund
Alliance Growth Investors Fund
Alliance Income Builder Fund
Alliance Real Estate Investment Fund
Alliance Utility Income Fund
AGGRESSIVE GROWTH
Alliance Global Small Cap Fund
Alliance Quasar Fund
Alliance Technology Fund
INTERNATIONAL
Alliance All-Asia Investment Fund
Alliance Greater China '97 Fund
Alliance International Fund
Alliance International Premier Growth Fund
Alliance New Europe Fund
Alliance Worldwide Privatization Fund
CLOSED-END FUNDS
Alliance All-Market Advantage Fund
ACM Government Income Fund
ACM Government Opportunity Fund
ACM Government Securities Fund
ACM Government Spectrum Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
Alliance World Dollar Government Fund
Alliance World Dollar Government Fund II
The Austria Fund
The Korean Investment Fund
The Spain Fund
The Southern Africa Fund
CASH MANAGEMENT SERVICES
ACM Institutional Reserves
Government Portfolio
Prime Portfolio
Tax-Free Portfolio
Trust Portfolio
Alliance Capital Reserves
Alliance Government Reserves
Alliance Insured Account
Alliance Money Reserves
Alliance Municipal Trust
California Portfolio
Connecticut Portfolio
Florida Portfolio
General Portfolio
Massachusetts Portfolio
New Jersey Portfolio
New York Portfolio
Virginia Portfolio
Alliance Treasury Reserves
Alliance Money Market Fund
Prime Portfolio
Government Portfolio
General Municipal Portfolio
21
ALLIANCE GROWTH AND INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
ALLIANCE CAPITAL
THIS REPORT IS INTENDED SOLELY FOR DISTRIBUTION TO CURRENT SHAREHOLDERS
OF THE FUND.
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER,
ALLIANCE CAPITAL MANAGEMENT L.P.
GTHSR
