ALLIANCE GROWTH AND INCOME FUND
SEMI-ANNUAL REPORT
APRIL 30, 1999
ALLIANCE CAPITAL
LETTER TO SHAREHOLDERS ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
June 28, 1999
Dear Shareholder:
This semi-annual report provides you with an update of the performance and
market activity of Alliance Growth & Income Fund (the "Fund") for the period
ended April 30, 1999.
INVESTMENT RESULTS
As a result of its strong selection of value stocks, the Fund performed
strongly over the six-month period ended April 30, 1999, posting returns of
23.08% at net asset value (NAV). The Fund's performance over this period
surpassed that of its benchmark, the Standard & Poor's 500 Stock Index ("S&P
500"), which returned only 22.31%. Additionally, the Fund outperformed its peer
group benchmark, the Lipper Growth & Income Funds Average, which returned
18.39% over the same six-month reporting period.
During the 12-month period ended April 30, 1999, however, the Fund's
performance lagged that of the S&P 500. Whereas the Fund's Class A shares
returned 18.32%, the S&P 500 returned 21.83% for the 12-month period under
review. The Fund's underperformance over this review period occurred primarily
because of the strong performance of growth stocks, which make up a large
percentage of the S&P 500, and the weaker performance of value stocks, which
make up the majority of the Fund. Nevertheless, the Fund still performed very
well against its value-driven peer group. Its peer group benchmark, the Lipper
Growth & Income Funds Average, returned only 10.73% during the 12-month period
under review.
INVESTMENT RESULTS*
Periods ended April 30, 1999
TOTAL RETURNS
6 MONTHS 12 MONTHS
---------- -----------
ALLIANCE GROWTH & INCOME FUND
Class A 23.08% 18.32%
Class B 22.56% 17.35%
Class C 22.56% 17.35%
S&P 500 STOCK INDEX 22.31% 21.83%
LIPPER GROWTH & INCOME FUNDS AVERAGE 18.39% 10.73%
* 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, 1999. 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 869 FUNDS FOR
THE SIX-MONTH PERIOD AND 815 FUNDS FOR THE 12-MONTH PERIOD ENDED APRIL 30,
1999. THESE FUNDS HAVE GENERALLY SIMILAR INVESTMENT OBJECTIVES TO ALLIANCE
GROWTH & 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 REVIEW
The past year has been characterized by extremes in the investment performance
of two groups of stocks: growth stocks and value stocks. Value stocks, where
price tends to be low in relation to earnings or book value, have experienced
some of the worst relative appreciation in their modern history. This
contrasted to the behavior of growth stocks, for which current favorable
business conditions have fostered a higher price-to-earnings (P/E) ratio.
In the S&P 500, the last five calendar quarters have been marked by a
well-defined division between the performance of these two groups of stocks.
The growth stock
1
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
half of the S&P 500 returned 52% to investors over the past five calendar
quarters, while, at the same time, the value half returned only 18%. The total
difference in these two returns was thus a significant 34% in favor of the S&P
500's growth stocks. As your Fund retains a bias toward value stocks, its
twelve-month results clearly could not keep pace with the performance of the
broader S&P 500 benchmark.
During the month of April, however, a pronounced rotation into the value arena
began to take place. While growth stocks were essentially flat for the month,
the value half of the S&P 500 became very active. Returns for the value half of
the S&P 500 for April 1999 went up nearly 9%. This brought the six-month
performance of growth and value stocks to a roughly equal position, allowing
your Fund to outperform the broad market (as represented by the S&P 500) on the
basis of its strong value stock selection.
INVESTMENT DISCUSSION
The hostile value stock environment of the late 1990s can be better understood
by recognizing that value stocks tend to exhibit more business risk than growth
stocks. The value universe includes companies such as financial firms, energy
corporations, commodity producers, and industrial manufacturers. These types of
companies are generally subject to greater exposure to economic and credit
cycles than are companies in the growth stock universe. Companies in the growth
stock universe tend to have less economic exposure and greater secular
stability. As a result, value stocks are cheap because investors discount
business risk in the stock price.
During 1998, we witnessed a series of financial and political crises that
caused many investors to reduce their tolerance for risk in their portfolios.
These events engendered a flight to safety by these investors, creating an
imbalance in the market between growth and value stock purchases. As a result,
growth stocks--with their lower risk profiles--were bid up to unsustainable
levels, often with funds that were repatriated from these investors' value
investments. But we maintain that the panic contained the seeds of its own
remedy. The deep recessions in the emerging markets removed capacity from their
economies, allowing commodity prices to firm. At the same time, central banks
around the globe began to stimulate their monetary systems. The result, in our
view, has been a renewal of global growth and a return of confidence to the
marketplace. We believe that these factors, combined with the overvaluation of
growth stocks, have precipitated the current reversal in the market towards
value stocks. We anticipate that value stocks will continue their good
performance as long as global economic conditions continue to improve.
INVESTMENT OUTLOOK
Your Fund has been consistent in its portfolio characteristics of maintaining a
defensive dividend yield and P/E ratio, a fully invested posture, and a high
degree of sector and industry diversification. We continue to seek the stocks
of companies with reasonable valuation combined with growth potential. 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 &
Income Fund. We look forward to reporting to you 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 & 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, 1999
CLASS A SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 18.32% 13.28%
Five Years 23.91% 22.86%
Ten Years 16.41% 15.92%
CLASS B SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 17.35% 13.35%
Five Years 22.96% 22.96%
Since Inception* (a) 16.48% 16.48%
CLASS C SHARES
WITHOUT WITH
SALES CHARGE SALES CHARGE
------------ ------------
One Year 17.35% 16.35%
Five Years 22.95% 22.95%
Since Inception* 19.55% 19.55%
SEC AVERAGE ANNUAL TOTAL RETURNS AS OF THE MOST RECENT QUARTER-END
(MARCH 31, 1999)
CLASS A CLASS B CLASS C
------------ ------------ ------------
1 Year 6.70% 6.82% 9.80%
5 Years 21.47% 21.63% 21.62%
10 Years 15.57% N/A N/A
Since Inception* 11.06% 15.73% 18.57%
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.
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: 7/1/32, Class A; 2/8/91, Class B; 5/3/93, Class C.
N/A: not applicable
(a) Assumes conversion of Class B shares into Class A shares after 8 years.
3
TEN LARGEST HOLDINGS
APRIL 30, 1999 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
PERCENT OF
COMPANY VALUE NET ASSETS
- -------------------------------------------------------------------------------
Household International, Inc. $ 110,687,500 3.9%
Bristol-Myers Squibb Co. 105,259,500 3.7
Citigroup, Inc. 102,151,875 3.6
USX-Marathon Group 88,437,500 3.1
BankAmerica Corp. 81,360,000 2.8
Tenet Healthcare Corp. 79,760,362 2.8
Tyco International, Ltd. 69,062,500 2.4
AT&T Corp. 68,272,111 2.4
Saks, Inc. 59,272,219 2.1
Electronic Data Systems Corp. 59,141,125 2.1
$ 823,404,692 28.9%
MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED APRIL 30, 1999 (UNAUDITED)
_______________________________________________________________________________
SHARES
- -------------------------------------------------------------------------------
HOLDINGS
PURCHASES BOUGHT 4/30/99
- -------------------------------------------------------------------------------
Computer Sciences Corp. 462,000 462,000
Electronic Data Systems Corp. 660,000 1,100,300
Household International, Inc. 1,426,000 2,200,000
Newell Rubbermaid, Inc. 540,000 540,000
Pepsi Bottling Group, Inc. 1,120,000 1,120,000
Procter & Gamble Co. 550,000 550,000
Republic Services, Inc. Cl.A 1,656,000 1,656,000
Saks, Inc. 2,093,500 2,093,500
Tenet Healthcare Corp. 2,160,000 3,376,100
Wells Fargo Co. 636,000 636,000
HOLDINGS
SALES SOLD 4/30/99
- -------------------------------------------------------------------------------
Avon Products, Inc. 670,000 290,000
Campbell Soup Co. 1,372,500 -0-
Chase Manhattan Corp. 700,000 611,000
Coca-Cola Co. 325,000 -0-
Colgate-Palmolive Co. 265,000 -0-
Dayton Hudson Corp. 316,000 608,000
General Dynamics Corp. 499,000 -0-
Gillette Co. 480,000 -0-
MCI WorldCom, Inc. 275,000 451,950
United Technologies Corp. 168,000 374,100
4
PORTFOLIO OF INVESTMENTS
APRIL 30, 1999 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON & PREFERRED STOCKS-95.5%
FINANCE-19.4%
BANKING - MONEY CENTER-1.8%
Chase Manhattan Corp. 611,000 $ 50,560,250
BANKING - REGIONAL-4.5%
Bank One Corp. 320,000 18,880,000
BankAmerica Corp. 1,130,000 81,360,000
Wells Fargo Co. 636,000 27,467,250
------------
127,707,250
INSURANCE-5.2%
Citigroup, Inc. 1,357,500 102,151,875
PMI Group, Inc. 352,547 19,676,529
The Hartford Financial
Services Group, Inc. 220,000 12,966,250
Travelers Property Casualty
Corp. C1.A 391,900 13,520,550
------------
148,315,204
REAL ESTATE-2.1%
Avalonbay Communities,
Inc. 299,957 10,498,495
Crescent Real Estate
Equities Co. 168,700 3,774,663
Equity Office Properties
Trust 607,700 16,749,731
MeriStar Hospitality Corp. 600,000 13,800,000
ProLogis Trust 400,000 8,400,000
Public Storage, Inc. 205,600 5,731,100
Regency Realty Corp.. 19,200 415,200
------------
59,369,189
MISCELLANEOUS-5.8%
Associates First Capital
Corp. C1.A 230,000 10,191,875
The CIT Group, Inc. C1.A 520,100 16,903,250
Household International,
Inc. 2,200,000 110,687,500
MBNA Corp. 765,000 21,563,438
Newcourt Credit Group,
Inc. (a) (Canada) 212,600 6,005,950
------------
165,352,013
------------
551,303,906
CONSUMER SERVICES-15.4%
AIRLINES-1.2%
Delta Air Lines, Inc. 558,000 35,398,125
BROADCASTING & CABLE-2.2%
Belo A.H. Corp. Series A 988,700 21,380,638
Chancellor Media
Corp. (a) 272,000 14,917,500
MediaOne Group, Inc. 320,000 25,640,000
------------
61,938,138
ENTERTAINMENT & LEISURE-3.6%
Carnival Corp. 500,000 20,625,000
CSC Holdings, Inc. 8.5%
Series I cummulative
convertible pfd. 445,000 51,480,937
Harley-Davidson, Inc. 500,000 29,812,500
------------
101,918,437
PRINTING & PUBLISHING-1.4%
Donnelley (R.R.) & Sons
Co. 420,000 14,857,500
Gannett Co., Inc. 360,000 25,492,500
------------
40,350,000
RESTAURANTS & LODGING-0.6%
Royal Caribbean Cruises,
Ltd. 7.25% pfd. Series A 147,000 16,886,625
5
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
RETAIL - FOOD & DRUG-0.8%
Kroger Co. (a) 405,300 $ 22,012,856
RETAIL - GENERAL MERCHANDISE-4.7%
Dayton Hudson Corp. 608,000 40,926,000
Saks, Inc. (a) 2,093,500 59,272,219
Tommy Hilfiger Corp. (a) 489,000 34,168,875
------------
134,367,094
MISCELLANEOUS-0.9%
Newell Rubbermaid, Inc. 540,000 25,616,250
------------
438,487,525
TECHNOLOGY-13.3%
COMMUNICATION EQUIPMENT-1.7%
Northern Telecom, Ltd. 138,300 9,430,331
Tellabs, Inc. (a) 350,000 38,292,188
------------
47,722,519
COMPUTER HARDWARE-0.7%
Compaq Computer Corp. 904,300 20,177,194
COMPUTER PERIPHERALS-0.5%
Seagate Technology,
Inc. (a) 496,000 13,826,000
COMPUTER SERVICES-4.1%
Computer Sciences Corp. 462,000 27,517,875
Electronic Data Systems
Corp. 1,100,300 59,141,125
First Data Corp. 750,000 31,828,125
------------
118,487,125
COMPUTER SOFTWARE-0.5%
Oracle Corp. (a) 510,000 13,801,875
NETWORKING SOFTWARE-0.9%
Ascend Communications,
Inc. (a) 260,000 25,106,250
SEMI-CONDUCTOR COMPONENTS-2.1%
Altera Corp. (a) 546,300 39,538,462
Atmel Corp. (a) 1,084,100 19,717,069
------------
59,255,531
MISCELLANEOUS-2.8%
Sanmina Corp. (a) 646,900 42,897,556
Solectron Corp. (a) 760,200 36,869,700
------------
79,767,256
------------
378,143,750
ENERGY-11.6%
DOMESTIC INTEGRATED-5.1%
Atlantic Richfield Co. 400,000 33,575,000
Kerr-McGee Corp. (a) 573,400 24,297,825
USX-Marathon Group 2,830,000 88,437,500
------------
146,310,325
DOMESTIC PRODUCERS-2.3%
Apache Corp. 710,200 21,794,262
Murphy Oil Corp. 242,000 11,358,875
Shell Transport & Trading
Co. ADR
(United Kingdom) 660,000 29,988,750
Union Pacific Resources
Group, Inc. 209,400 2,931,600
------------
66,073,487
OIL SERVICE-3.7%
BJ Services Co. (a) 940,000 25,145,000
Noble Drilling Corp. (a) 2,969,400 58,274,475
Transocean Offshore, Inc. 730,000 21,671,875
------------
105,091,350
MISCELLANEOUS-0.5%
AES Corp. (a) 253,300 12,665,000
------------
330,140,162
6
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
COMPANY SHARES VALUE
- -------------------------------------------------------------------------
CONSUMER STAPLES-9.4%
BEVERAGES-2.1%
Coca-Cola Enterprises,
Inc. 1,030,000 $ 35,535,000
Pepsi Bottling Group, Inc. 1,120,000 23,590,000
------------
59,125,000
COSMETICS-0.5%
Avon Products, Inc. 290,000 15,750,625
FOOD-1.5%
General Mills, Inc. 168,000 12,285,000
Heinz (H.J.) Co. 270,000 12,605,625
Tyson Foods, Inc. C1.A 800,000 16,550,000
------------
41,440,625
HOUSEHOLD PRODUCTS-1.8%
Procter & Gamble Co. 550,000 51,596,875
TOBACCO-3.5%
Philip Morris Cos., Inc. 1,407,250 49,341,703
RJR Nabisco Holdings
Corp. 1,933,900 49,797,925
------------
99,139,628
------------
267,052,753
UTILITIES-8.7%
ELECTRIC & GAS UTILITY-5.0%
CMS Energy Corp. 620,000 27,280,000
Consolidated Edison, Inc. 890,300 40,453,006
FPL Group, Inc. 668,000 37,658,500
GPU, Inc. 530,000 20,206,250
Pinnacle West Capital
Corp. 415,000 16,107,188
------------
141,704,944
TELEPHONE UTILITY-3.7%
AT&T Corp. 1,351,923 68,272,111
MCI WorldCom, Inc. (a) 451,950 37,130,517
------------
105,402,628
------------
247,107,572
HEALTH CARE-7.4%
DRUGS-3.7%
Bristol-Myers Squibb Co. 1,656,000 105,259,500
MEDICAL SERVICES-3.7%
PacifiCare Health Systems,
Inc. C1.B (a) 336,500 26,846,391
Tenet Healthcare Corp. (a) 3,376,100 79,760,362
------------
106,606,753
------------
211,866,253
MULTI INDUSTRY COMPANIES-4.0%
Honeywell, Inc. 255,000 24,161,250
Tyco International, Ltd. 850,000 69,062,500
U.S. Industries, Inc. 1,069,200 19,847,025
------------
113,070,775
CAPITAL GOODS-4.7%
MACHINERY-0.4%
Case Corp. 335,000 11,599,375
MISCELLANEOUS-3.1%
Allied-Signal, Inc. 601,000 35,308,750
United Technologies
Corp. 374,100 54,197,738
------------
89,506,488
POLLUTION CONTROL-1.2%
Republic Services, Inc.
C1.A (a) 1,656,000 34,051,500
------------
135,157,363
BASIC INDUSTRY-0.8%
CHEMICALS-0.8%
Dow Chemical Co. 180,000 23,613,750
TRANSPORTATION-0.8%
RAILROAD-0.8%
Union Pacific Capital Trust
6.25%, 4/01/28
Convertible pfd. (b) 444,000 23,698,500
Total Common & Preferred Stocks
(cost $2,170,560,444) 2,719,642,309
7
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
PRINCIPAL
AMOUNT
COMPANY (000) VALUE
- -------------------------------------------------------------------------
CONVERTIBLE BOND-0.5%
Genzyme Corp.
5.25%, 6/01/05
(cost $11,323,508) $10,900 $ 12,793,875
SHORT-TERM INVESTMENTS-4.5%
COMMERCIAL PAPER-3.5%
Ford Motor Credit Corp.
4.83%, 5/03/99 45,000 44,987,925
Prudential Funding Corp.
4.62%, 5/04/99 25,000 24,990,375
4.80%, 5/07/99 30,000 29,976,000
Total Commercial Paper
(amortized cost
$99,954,300) 99,954,300
TIME DEPOSIT-1.0%
State Street Cayman Islands
4.50%, 5/03/99
(amortized cost
$28,379,000) 28,379 28,379,000
TOTAL INVESTMENTS-100.5%
(cost $2,310,217,252) 2,860,769,484
Other assets less
liabilities-(0.5%) (13,280,029)
NET ASSETS-100% $ 2,847,489,455
(a) Non-income producing security.
(b) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. This security may be resold in transactions exempt from registration,
normally to qualified institutional buyers. At April 30, 1999, this security
amounted to $23,698,500 or 0.8% of net assets.
See notes to financial statements.
8
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1999 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
ASSETS
Investments in securities, at value (cost $2,310,217,252) $ 2,860,769,484
Receivable for capital stock sold 23,225,877
Receivable for investment securities sold 10,135,397
Dividends and interest receivable 3,115,320
Other assets 124,084
Total assets 2,897,370,162
LIABILITIES
Payable for investment securities purchased 44,551,619
Payable for capital stock redeemed 1,803,363
Distribution fee payable 1,407,816
Advisory fee payable 1,026,610
Accrued expenses and other liabilities 1,091,299
Total liabilities 49,880,707
NET ASSETS $ 2,847,489,455
COMPOSITION OF NET ASSETS
Capital stock, at par $ 7,532,582
Additional paid-in capital 2,193,103,528
Distributions in excess of net investment income (2,543,491)
Accumulated net realized gain on investments and foreign
currency transactions 98,844,604
Net unrealized appreciation of investments and other assets 550,552,232
$ 2,847,489,455
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share
($1,283,361,983/337,417,186 shares of capital stock
issued and outstanding) $3.80
Sales charge--4.25% of public offering price .17
Maximum offering price $3.97
CLASS B SHARES
Net asset value and offering price per share
($1,231,084,504/327,448,953 shares of capital stock
issued and outstanding) $3.76
CLASS C SHARES
Net asset value and offering price per share
($299,123,186/79,485,518 shares of capital stock
issued and outstanding) $3.76
ADVISOR CLASS SHARES
Net asset value, redemption and offering price per share
($33,919,782/8,906,522 shares of capital stock
issued and outstanding) $3.81
See notes to financial statements.
9
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1999 (UNAUDITED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
INVESTMENT INCOME
Dividends (net of foreign taxes withheld
of $33,890) $ 18,822,182
Interest 2,498,021 $ 21,320,203
EXPENSES
Advisory fee 5,368,312
Distribution fee - Class A 1,317,250
Distribution fee - Class B 4,711,791
Distribution fee - Class C 1,096,885
Transfer agency 1,890,165
Printing 264,598
Registration 214,612
Custodian 158,671
Audit and legal 66,241
Administrative 63,000
Taxes 47,896
Directors' fees 27,500
Miscellaneous 79,428
Total expenses 15,306,349
Net investment income 6,013,854
REALIZED AND UNREALIZED GAIN ON INVESTMENT
TRANSACTIONS
Net realized gain on investments and foreign
currency transactions 101,917,285
Net change in unrealized appreciation of
investments and other assets 373,691,749
Net gain on investments 475,609,034
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 481,622,888
See notes to financial statements.
10
STATEMENT OF CHANGES IN NET ASSETS ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1999 OCTOBER 31,
(UNAUDITED) 1998
----------------- -----------------
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income $ 6,013,854 $ 10,090,007
Net realized gain on investment and
foreign currency transactions 101,917,285 208,599,998
Net change in unrealized appreciation of
investments and other assets 373,691,749 (20,404,838)
Net increase in net assets from
operations 481,622,888 198,285,167
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (4,130,909) (11,056,910)
Class B (1,430,740) (3,430,012)
Class C (329,589) (790,836)
Advisor Class (122,616) (59,998)
Distributions in excess of net
investment income
Class A (2,017,041) -0-
Class B (698,602) -0-
Class C (160,931) -0-
Advisor Class (59,871) -0-
Net realized gain on investments
Class A (101,835,187) (104,156,500)
Class B (83,069,507) (62,542,206)
Class C (18,905,921) (14,674,879)
Advisor Class (2,466,651) (419,910)
CAPITAL STOCK TRANSACTIONS
Net increase 602,125,725 624,116,466
Total increase 868,521,048 625,270,382
NET ASSETS
Beginning of year 1,978,968,407 1,353,698,025
End of period $ 2,847,489,455 $ 1,978,968,407
See notes to financial statements.
11
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1999 (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 may 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 prices. 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 the 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 these
differences are permanent,
12
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
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 $63,000 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, 1999.
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 $1,283,114 for the six months ended April 30, 1999.
For the six months ended April 30, 1999, the Fund's expenses were reduced by
$100,262 under an expense offset arrangement with Alliance Fund Services.
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 $171,742 from the sale of Class
A shares and $22,832, $910,116 and $31,866 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, 1999.
Brokerage commissions paid on investment transactions for the six months ended
April 30, 1999 amounted to $2,229,824, of which $20,400 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
$31,653,880 and $2,960,794 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 $1,075,373,652 and $648,736,889,
respectively, for the six months ended April 30, 1999. There were no purchases
and sales of U.S. government and government agency obligations for the six
months ended April 30, 1999.
At April 30, 1999, the cost of investments for federal income tax purposes was
substantially the same as the cost for financial reporting purposes. Gross
unrealized appreciation of investments was $612,894,609 and gross unrealized
depreciation of investments was $62,342,377 resulting in net unrealized
appreciation of $550,552,232.
13
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
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 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, 1999, 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. Each class consists of 3,000,000,000 authorized shares.
Transactions in capital stock were as follows:
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1999 OCTOBER 31, APRIL 30, 1999 OCTOBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------ ------------ --------------- -------------
CLASS A
Shares sold 91,565,592 98,222,812 $ 323,758,713 $ 334,903,712
Shares issued in
reinvestment of
dividends and
distributions 27,610,972 29,831,349 89,956,864 93,523,259
Shares converted
from Class B 3,248,504 8,647,040 13,281,632 29,353,090
Shares redeemed (72,429,884) (75,720,075) (256,296,744) (257,505,502)
Net increase 49,995,184 60,981,126 $ 170,700,465 $ 200,274,559
CLASS B
Shares sold 106,111,873 121,143,305 $ 371,882,959 $ 410,581,531
Shares issued in
reinvestment of
dividends and
distributions 24,471,098 19,847,882 78,892,132 61,492,874
Shares converted
to Class A (3,784,612) (8,725,071) (13,281,632) (29,353,090)
Shares redeemed (30,630,139) (33,250,320) (106,836,818) (109,755,296)
Net increase 96,168,220 99,015,796 $ 330,656,641 $ 332,966,019
14
ALLIANCE GROWTH AND INCOME FUND
_______________________________________________________________________________
SHARES AMOUNT
--------------------------- -----------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1999 OCTOBER 31, APRIL 30, 1999 OCTOBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------- ------------ -------------- ------------
CLASS C
Shares sold 38,434,324 33,804,199 $135,008,376 $114,565,500
Shares issued in
reinvestment of
dividends and
distributions 5,654,067 4,670,589 18,228,202 14,469,664
Shares redeemed (17,252,823) (16,673,562) (60,476,215) (55,675,053)
Net increase 26,835,568 21,801,226 $ 92,760,363 $ 73,360,111
ADVISOR CLASS
Shares sold 1,762,145 7,117,703 $ 6,332,751 $ 22,635,129
Shares issued in
reinvestment of
dividends and
distributions 804,306 143,377 2,630,497 450,418
Shares redeemed (276,052) (1,567,478) (954,992) (5,569,770)
Net increase 2,290,399 5,693,602 $ 8,008,256 $ 17,515,777
NOTEF: BANK BORROWING
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $750 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expense in the statement of operations. The Fund did not utilize
the Facility during the six months ended April 30, 1999.
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
APRIL 30, YEAR ENDED OCTOBER 31,
1999 ---------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $3.44 $3.48 $3.00 $2.71 $2.35 $2.61
INCOME FROM INVESTMENT OPERATIONS
Net investment income .02(a) .03(a) .04(a) .05 .02 .06
Net realized and unrealized gain (loss)
of investment transactions .71 .43 .87 .50 .52 (.08)
Net increase (decrease) in net asset
value from operations .73 .46 .91 .55 .54 (.02)
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.02) (.04) (.05) (.05) (.06) (.06)
Distributions from net realized gains (.35) (.46) (.38) (.21) (.12) (.18)
Total dividends and distributions (.37) (.50) (.43) (.26) (.18) (.24)
Net asset value, end of period $3.80 $3.44 $3.48 $3.00 $2.71 $2.35
TOTAL RETURN
Total investment return based on net
asset value (b) 23.08% 14.70% 33.28% 21.51% 24.21% (.67)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $1,283,362 $988,965 $787,566 $553,151 $458,158 $414,386
Ratio of expenses to average net assets .95%(c) .93%(d) .92%(d) .97% 1.05% 1.03%
Ratio of net investment income to
average net assets .91%(c) .96% 1.39% 1.73% 1.88% 2.36%
Portfolio turnover rate 29% 89% 88% 88% 142% 68%
</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
APRIL 30, YEAR ENDED OCTOBER 31,
1999 ---------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $3.41 $3.45 $2.99 $2.69 $2.34 $2.60
INCOME FROM INVESTMENT OPERATIONS
Net investment income -0-(a) .01(a) .02(a) .03 .01 .04
Net realized and unrealized gain (loss)
of investment transactions .71 .43 .85 .51 .49 (.08)
Net increase (decrease) in net asset
value from operations .71 .44 .87 .54 .50 (.04)
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.01) (.02) (.03) (.03) (.03) (.04)
Distributions from net realized gains (.35) (.46) (.38) (.21) (.12) (.18)
Total dividends and distributions (.36) (.48) (.41) (.24) (.15) (.22)
Net asset value, end of period $3.76 $3.41 $3.45 $2.99 $2.69 $2.34
TOTAL RETURN
Total investment return based on net
asset value (b) 22.56% 14.07% 31.83% 21.20% 22.84% (1.50)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $1,231,085 $787,730 $456,399 $235,263 $136,758 $102,546
Ratio of expenses to average net assets 1.73%(c) 1.72%(d) 1.72%(d) 1.78% 1.86% 1.85%
Ratio of net investment income to
average net assets .14%(c) .17% .56% .91% 1.05% 1.56%
Portfolio turnover rate 29% 89% 88% 88% 142% 68%
</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
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1999 --------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $3.41 $3.45 $2.99 $2.70 $2.34 $2.60
INCOME FROM INVESTMENT OPERATIONS
Net investment income -0-(a) .01(a) .02(a) .03 .01 .04
Net realized and unrealized gain (loss)
on investment transactions .71 .43 .85 .50 .50 (.08)
Net increase (decrease) in net asset
value from operations .71 .44 .87 .53 .51 (.04)
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.01) (.02) (.03) (.03) (.03) (.04)
Distributions from net realized gains (.35) (.46) (.38) (.21) (.12) (.18)
Total dividends and distributions (.36) (.48) (.41) (.24) (.15) (.22)
Net asset value, end of period $3.76 $3.41 $3.45 $2.99 $2.70 $2.34
TOTAL RETURN
Total investment return based on net
asset value (b) 22.56% 14.07% 31.83% 20.72% 23.30% (1.50)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $299,123 $179,487 $106,526 $61,356 $35,835 $19,395
Ratio of expenses to average net assets 1.71%(c) 1.72%(d) 1.71%(d) 1.76% 1.84% 1.84%
Ratio of net investment income to
average net assets .16%(c) .18% .58% .93% 1.04% 1.61%
Portfolio turnover rate 29% 89% 88% 88% 142% 68%
</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
ENDED OCTOBER 2,
APRIL 30, YEAR ENDED OCTOBER 31, 1996(E) TO
1999 ----------------------- OCTOBER 31,
(UNAUDITED) 1998 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $3.44 $3.48 $3.00 $2.97
INCOME FROM INVESTMENT OPERATIONS
Net investment income .02(a) .04(a) .05(a) -0-
Net realized and unrealized gain
on investment transactions .72 .43 .87 .03
Net increase in net asset
value from operations .74 .47 .92 .03
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.02) (.05) (.06) -0-
Distributions from net realized gains (.35) (.46) (.38) -0-
Total dividends and distributions (.37) (.51) (.44) -0-
Net asset value, end of period $3.81 $3.44 $3.48 $3.00
TOTAL RETURN
Total investment return based on net
asset value (b) 23.50% 14.96% 33.61% 1.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $33,920 $22,786 $3,207 $87
Ratio of expenses to average net assets .71%(c) .76%(d) .71%(d) .37%(c)
Ratio of net investment income to
average net assets 1.16%(c) 1.14% 1.42% 3.40%(c)
Portfolio turnover rate 29% 89% 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) Ratios reflect expenses grossed up for expense offset arrangement with the
transfer agent. For the periods shown below the net expense ratios were as
follows:
YEAR ENDED OCTOBER 31,
----------------------
1998 1997
----- -----
Class A .92% .91%
Class B 1.71% 1.71%
Class C 1.71% 1.70%
Advisor Class .75% .70%
(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
FRANK CARUSO, VICE PRESIDENT
JOEL SWANSON, 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 LLP
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
PRICEWATERHOUSECOOPERS LLP
1177 Avenue of the Americas
New York, NY 10036-2798
(1) Member of the Audit Committee.
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 U.S. Government Fund
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
Select Investors Series - Premier Portfolio
GROWTH & INCOME
Alliance Balanced Shares
Alliance Conservative Investors Fund
Alliance Growth & Income Fund
Alliance Growth Investors 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
INSTITUTIONAL
Premier Growth
Quasar
Real Estate Investment
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
Alliance Capital Reserves
Alliance Government Reserves
Alliance Institutional Reserves
Prime Portfolio
Government Portfolio
Tax-Free Portfolio
Treasury Portfolio
Trust Portfolio
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
General Municipal Portfolio
Government 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
