The American Funds Group(r)
THE GROWTH FUND OF AMERICA
investing in the Future
[montage illustration of a DNA strand, fiber optic cables, satellite dishes on
a hillside, and a scientific thermometer]
Annual Report
for the year ended -- August 31, 2000
THE GROWTH FUND OF AMERICA(r)
invests in a wide range of companies that appear to offer superior
opportunities for growth of capital.
The Growth Fund of America is one of the 29 American Funds, the nation's
third-largest mutual fund family. For nearly seven decades, Capital Research
and Management Company, the American Funds adviser, has invested with a
long-term focus based on thorough research and attention to risk.
ABOUT THE COVER:
The Growth Fund of America invests in companies that we believe will show
strong growth for years to come. Industries represented on the cover include
biotechnology, fiber optics and data communications.
[begin table]
<TABLE>
<CAPTION>
<S> <C> <C> <C>
5-year Lifetime*
12-month average annual average annual
total returns compound returns compound returns
(9/1/99-8/31/00) (9/1/95-8/31/00) (12/1/73-8/31/00)
The Growth Fund of 53.5% 28.1% 18.9%
America
Standard & Poor's 16.3 24.0 14.9
500 Composite Index
Lipper Capital 32.1 20.6 15.2
Appreciation Fund
Index
Lipper Growth Fund 28.1 22.5 14.3
Index
Lipper Multi-Cap 52.6 26.1 16.2
Growth Fund Index
</TABLE>
*Since Capital Research and Management Company began managing the fund on
12/1/73.
[end table]
Fund results in this report were calculated for Class A shares at net asset
value (without a sales charge), unless otherwise indicated.
There are two ways to invest in The Growth Fund of America. Class A shares are
subject to a 5.75% maximum up-front sales charge that declines for accounts of
$25,000 or more. Class B shares, which are not available for certain
employer-sponsored retirement plans, have no up-front charge. They are,
however, subject to additional expenses of approximately 0.75% a year over the
first eight years of ownership. If redeemed within six years, they may also be
subject to a contingent deferred sales charge (5% maximum) that declines over
time.
FIGURES SHOWN ARE PAST RESULTS AND ARE NOT PREDICTIVE OF FUTURE RESULTS. SHARE
PRICE AND RETURN WILL VARY, SO YOU MAY LOSE MONEY. INVESTING FOR SHORT PERIODS
MAKES LOSSES MORE LIKELY. INVESTMENTS ARE NOT FDIC-INSURED, NOR ARE THEY
DEPOSITS OF OR GUARANTEED BY A BANK OR ANY OTHER ENTITY.
FELLOW SHAREHOLDERS:
[Begin Sidebar]
Researchers in corporate laboratories and workshops are already hard at work
seeking to reap benefits from the biotechnology and bandwidth revolutions.
[End Sidebar]
We are pleased to report another year of exceptional gains for The Growth Fund
of America. For the fiscal year ended August 31, 2000, the fund produced a
total return of 53.5%, outpacing all of its benchmarks, most by wide margins.
The fund's gain assumes you reinvested the dividend of 4.5 cents a share and
capital gain distribution of $3.20 a share paid in December 1999. In
comparison, the unmanaged Standard & Poor's 500 Stock Composite Index, a
measure of large U.S. stocks, increased 16.3% while the Lipper Capital
Appreciation Fund Index, which tracks the largest capital appreciation funds,
gained 32.1%.
We are gratified that the fund has once again produced a gain of more than 50%,
following last year's 61.3% gain. It was particularly satisfying that the fund
was able to achieve these results with about 14% of assets held in cash and
equivalents as a reserve against heightened volatility. We now have more than
$5 billion cash available to invest if the stocks of our favorite companies "go
on sale" in a market downdraft.
In addition, as the table on the facing page illustrates, the fund has outpaced
the indexes over the short, medium and long term.
BANDWIDTH REVOLUTION HELPS FUND
Technology companies involved with the expansion of bandwidth for high-speed
data communications helped the fund enormously. PMC-Sierra, a designer of
semiconductors for high-speed data communications and the fund's third-largest
holding, rose 407.5%. Corning, which manufactures optical fiber and other high
performance glass products, gained 393.1%. Corning is the fund's
seventh-largest investment. Palm, a spin-off from 3Com that makes handheld
wireless devices called "personal digital assistants," increased 163.0%. These
companies are leading the way to meet the worldwide demand for faster and
richer data transmission to individuals and businesses over the Internet
whether through a computer or a handheld wireless device.
Other technology companies among our top ten holdings that did especially well
were Micron Technology, a manufacturer of memory-related integrated circuits
(+119.3%) and Texas Instruments, the world's largest manufacturer of digital
signal processors (+63.1%).
[illustration of a DNA strand and fiber optic cables]
MEDIA COMPANIES DELIVER STRONG RESULTS
An important part of the explosive growth of the Internet and increasing
bandwidth (the rate at which data can be transmitted from one computer to
another) is the need for content. That is why the fund has long been invested
in content-providing entertainment and media companies. Viacom, our largest
holding (+60.0%), and Time Warner, the fund's second-largest holding (+44.2%),
delivered strong results in the past fiscal year. Viacom completed its
acquisition of CBS, and Time Warner is in the process of being acquired by
America Online.
BIOTECHNOLOGY STOCKS ATTRACT INVESTORS
The fund's investments in the biotechnology industry did extraordinarily well.
They included Celera Genomics (+654.4%), Millennium Pharmaceuticals (+385.7%)
and Affymetrix (+105.0%). The sequencing of the human genome completed in June
is expected to lead eventually to the development of new diagnostic tests and
therapeutic drugs for genetic diseases, and these companies are key players in
research and development of this new science. Our feature story, which begins
on page 4, describes how the fund invests in the biotechnology and bandwidth
revolutions with an eye for value.
HOW THE FUND FARED DURING THE NASDAQ DECLINE
The fund did especially well this year in that it declined less than most other
funds of this type during the big fall taken by technology stocks last spring.
From March 10 through May 23, the technology-heavy Nasdaq index fell 37% and
the Morgan Stanley Internet Index tumbled 50%. In contrast, The Growth Fund of
America declined only 11%. The fund has had very little exposure to the pure
"dot.com" stocks that fell sharply during the spring decline. Instead, the
fund's Internet investments have focused on companies that build infrastructure
and provide services for the Internet.
LOOKING AHEAD
In December, the fund expects to pay a capital gain distribution of between 8%
and 12% of the current share price. We are always mindful of taxes that our
shareholders pay on capital gain distributions. However, careful portfolio
management means that securities will be sold when it is appropriate to do so
for investment reasons.
The past 12 months marked the ninth consecutive year of solid economic growth
in the United States. The coming year, however, has a number of question marks
surrounding it - rising oil prices, concerns about the availability of energy
and a new administration in Washington among them. Reflecting on the fund's
past two years of remarkable gains and the possibly volatile year ahead, we
believe it is important for growth-oriented investors to take a long-term
perspective.
Cordially,
/s/ James F. Rothenberg
James F. Rothenberg
Chairman of the Board
/s/ James E. Drasdo
James E. Drasdo
President
October 11, 2000
THE VALUE OF A LONG-TERM PERSPECTIVE
How a $10,000 Investment has Grown
From December 1, 1973 Through August 31, 2000
[Begin Table]
<TABLE>
<CAPTION>
Average Annual Compound Returns
(based on a $1,000 investment with all distributions reinvested)
Class A Shares* reflecting 5.75% maximum sales charge
<S> <C> <C>
Periods Ended
9/30/2000
(the most recent
8/31/2000 calendar quarter)
10 years + 22.14% + 22.33%
5 years + 26.61% + 25.51%
1 year + 44.67% + 39.43%
</TABLE>
*Results for Class B shares are not shown because of the brief time between
their introduction on March 15, 2000, and the end of the period.
[End Table]
[begin mountain chart]
$965,879(1),(2)
The Growth
Fund of America
$438,718(3)
Lipper Capital
Appreciation
Fund Index
$415,709(4)
Standard
& Poor's 500
Composite Index
$354,976(3)
Lipper Growth
Fund Index
$37,647(5)
Consumer
Price Index
(inflation)
$10,000(1)
original
investment
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Lipper Standard &
The Growth Capital Poor's 500 Consumer
Fund of Appreciation Composite Lipper Growth Price Index Original
Year America Fund Index Index Fund Index (inflation) Investment
1974* $7,874 $7,563 $7,738 $7,204 $10,893 $10,000
1975 $9,792 $9,379 $9,784 $9,126 $11,830 $10,000
1976 $11,165 $11,009 $12,056 $10,607 $12,505 $10,000
1977 $12,377 $11,796 $11,825 $10,558 $13,333 $10,000
1978 $20,136 $15,352 $13,294 $13,315 $14,379 $10,000
1979 $23,595 $17,603 $14,831 $15,033 $16,078 $10,000
1980 $31,496 $23,344 $17,533 $19,013 $18,148 $10,000
1981 $35,383 $25,992 $18,459 $20,125 $20,109 $10,000
1982 $38,595 $27,089 $19,055 $20,339 $21,285 $10,000
1983 $56,382 $43,555 $27,503 $30,631 $21,830 $10,000
1984 $56,805 $41,112 $29,176 $29,823 $22,767 $10,000
1985 $64,493 $47,110 $34,494 $34,712 $23,529 $10,000
1986 $82,962 $63,140 $47,994 $46,117 $23,900 $10,000
1987 $109,730 $81,186 $64,621 $59,044 $24,924 $10,000
1988 $97,962 $65,886 $52,989 $49,752 $25,926 $10,000
1989 $136,507 $89,371 $73,784 $67,293 $27,146 $10,000
1990 $123,184 $81,474 $70,004 $62,015 $28,671 $10,000
1991 $160,815 $103,691 $88,899 $79,872 $29,760 $10,000
1992 $168,703 $108,930 $95,952 $84,053 $30,697 $10,000
1993 $210,268 $134,479 $110,532 $101,030 $31,547 $10,000
1994 $222,852 $140,353 $116,621 $105,782 $32,462 $10,000
1995 $279,811 $171,806 $141,605 $128,702 $33,312 $10,000
1996 $282,323 $192,511 $168,079 $142,829 $34,270 $10,000
1997 $391,123 $240,565 $236,530 $191,969 $35,033 $10,000
1998 $390,174 $229,985 $255,645 $196,093 $35,599 $10,000
1999 $629,203 $332,052 $357,444 $277,049 $36,405 $10,000
2000 $965,879 $438,718 $415,709 $354,976 $37,647 $10,000
</TABLE>
[end mountain chart]
[begin table]
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Year ended August 31 1974* 1975 1976 1977 1978 1980
TOTAL VALUE
Dividends reinvested - $362 283 - 254 307
Value at year-end(1) $7,874 9,792 11,165 12,377 20,136 31,496
GFA TOTAL RETURN (21.3) 24.4 14.0 10.9 62.7 33.5
Year ended August 31 1981 1982 1983 1984 1985 1987
TOTAL VALUE
Dividends reinvested 546 1,673 2,290 1,643 1,249 1,354
Value at year-end(1) 35,383 38,595 56,382 56,805 64,493 109,730
GFA TOTAL RETURN 12.3 9.1 46.1 0.8 13.5 32.3
Year ended August 31 1988 1989 1990 1991 1992 1994
TOTAL VALUE
Dividends reinvested 1,502 1,743 3,611 3,208 2,510 929
Value at year-end(1) 97,962 136,507 123,184 160,815 168,703 222,852
GFA TOTAL RETURN (10.7) 39.3 (9.8) 30.5 4.9 6.0
Year ended August 31 1995 1996 1997 1998 1999 2000
TOTAL VALUE
Dividends reinvested 1,372 2,452 2,019 2,525 1,956 1,081
Value at year-end(1) 279,811 282,323 391,123 390,174 629,203 965,879
GFA TOTAL RETURN 25.6 0.9 38.5 (0.2) 61.3 53.5
</TABLE>
Average
annual
compound
return
for 26-3/4
years
18.6%(1),(2)
[end table]
PAST RESULTS ARE NOT PREDICTIVE OF FUTURE RESULTS. THE INDEXES ARE UNMANAGED
AND DO NOT REFLECT THE EFFECTS OF SALES CHARGES, COMMISSIONS OR EXPENSES.
* For the period December 1, 1973 (when Capital Research and Management
Company became the fund's investment advisor) through August 31, 1974.
(1) These figures, unlike those shown earlier in this report, reflect payment
of the maximum sales charge of 5.75% on the $10,000 investment. Thus, the
net amount invested was $9,425. As outlined in the prospectus, the sales
charge is reduced for investments larger than $25,000. The maximum initial
sales charge was 8.5% prior to July 1, 1988. There is no sales charge on
dividends or capital gain distributions that are invested in additional
shares. Results shown do not take into account income or capital gain
taxes.
(2) Includes reinvested dividends of $37,302 and reinvested capital gain
distributions of $259,633
(3) Includes reinvested dividends.
(4) Includes reinvested dividends of $54,636.
(5) Computed from data supplied by the U.S. Department of Labor, Bureau of
Labor Statistics.
[microscopic photo of a DNA strand]
[begin caption]
New technology allows for digital tracking of DNA. The image on this page is a
brightly colored DNA sequencing gel.
[end caption]
INVESTING IN THE FUTURE
WITH AN EYE FOR VALUE
[picture of fiber optic cables]
Picture a typical day 15 years in the future. You sit at a monitor and, with a
vocal command, have instant access to an entire world of full-length, 3-D
movies, high-fidelity audio and a complete set of educational, e-commerce and
communications tools - all through a single, affordable high-bandwidth
connection to the Internet.
[Begin Pull Quote]
"We depend on fundamental research to point out changing trends and elements of
future growth."
(jim rothenberg)
[End Pull Quote]
There are monitors all over your house - on desk tops, even on your
refrigerator - and you no longer have to go to a bookstore to buy a book or
magazine. You merely download novels and magazines into a flat Plexiglas
monitor, and turn pages electronically.
You order a medicine to lower your blood pressure from an Internet pharmacy. In
a few hours, you will receive a version of the drug based on your unique
genetic profile. You will have already taken a test using a microchip that can
detect gene mutations - and forecast your chances of coming down with a
serious condition like Alzheimer's disease. The test will also have shown
whether you have a predisposition for developing cancer or heart disease.
These future scenarios aren't as far-fetched as you may think. Researchers in
corporate laboratories and workshops are already hard at work on many aspects
of the impending bandwidth explosion and the revolution in biotechnology.
Analysts and portfolio counselors for Capital Research and Management Company,
the adviser to The Growth Fund of America, are hard at work as well,
identifying the companies that may be best positioned to participate profitably
in the many dramatic advances that will benefit society in the decades ahead.
These are companies with potential for major growth 5, 10, 15 and 20 years down
the road.
Admittedly, "the future is not even on the radar screen today," says Jim
Rothenberg, chairman of the fund. "Our process helps us pick what we hope are
the right companies in the right industries for the long term. We depend on
fundamental research to point out changing trends and elements of future
growth."
The fund's extensive research on bandwidth and biotech developments provides a
close look at that process.
THE BANDWIDTH REVOLUTION
POISED FOR EXPONENTIAL GROWTH
[photo of fiber optic line]
[Begin Pull Quote]
In 1985, it took six fibers in a fiber-optic line to carry a television
broadcast of a single football game. Now, one fiber can handle 700 football
games.
[End Pull Quote]
"Five years ago, if anyone asked about $bandwidth,' they thought you were
talking about how many tuba players you had in your band," says David Siminoff,
an Internet and media analyst for The Growth Fund of America. "Today, almost
everyone knows that bandwidth is the amount of data that can be transmitted at
any one moment from one computer to another. Bandwidth is the biggest buzzword
on the Internet."
Although computing power is said to have doubled every 18 months, the speed of
connections between computers has remained stubbornly slow for most users,
limiting the impact of the information revolution.
That's about to change as a new generation of high-speed fiber-optic data
communications networks are switched on over the next five years. They will
offer exponentially greater bandwidth. No longer will Internet access be
measured at a slow 28,880 bits per second (bps), but in megabytes, gigabytes
and terabytes per second. (The text of the Bible, for example, uses only five
megabytes.)
THE SECOND WAVE OF THE INFORMATION EXPLOSION
Proponents of the bandwidth explosion say this vast increase in communications
capacity will be nothing less than the second wave of the information
technology revolution. "It's not inconceivable that there will be a
million-fold rise in Internet traffic by 2005," says George Gilder, an author
and consultant who specializes in bandwidth.
In 1985, it took six fibers in a fiber-optic line to carry a television
broadcast of a single football game. Now, one fiber can handle 700 football
games. Bandwidth has been expanded by technological changes in fiber
composition, signal compression, satellite transmission, photonics and
semiconductors, says Gordon Crawford, portfolio counselor for the fund.
DEVELOPING BIGGER FIBER-OPTIC PIPES
In a few years, as these capabilities soar and costs dive, watching an Internet
TV broadcast from anywhere in the world should be as simple as accessing a
website. Movies and entertainment could be available on demand and the cost of
long-distance calls should be negligible. Video phones and video e-mail could
quickly catch on, and the interactive dream of marrying television with the
computer will be fulfilled. "Companies are developing bigger fiber-optic
$pipes' to spread richer and richer applications to more and more people," says
Barry Crosthwaite, a Capital Research analyst who covers fiber-optics
companies.
Still, problems remain before these forecasts can come true. One is sometimes
known as the "last-mile bottleneck." The major advances and investments in
expanding bandwidth have almost all been made in "backbone networks" - the
networks that carry traffic around cities, around the country or around the
world. The problem is, almost all homes and small businesses are connected to
these backbones by telephone lines, which can handle only a trickle of data.
FILLING IN THE BACKBONE OF BROADBAND
To fill the backbones, homes and small businesses will have to have big, fast
connections too - called broadband. More than 2 million households have a
broadband connection as of September 2000, and many more are expected by year's
end. Most people get broadband through a cable TV line. The second-most-popular
option is a telephone line, and a few people use a satellite dish or other
wireless technology.
"Everyone in the world knows this is an exciting area," says Gordon Crawford.
"There will be winners and losers in broadband. Even if you identify the
winners, there are times to own them and times not to own them."
[blurred photo of a computer mouse]
[Begin Pull Quote]
Proponents of the bandwidth explosion say this vast increase in communications
capacity will be nothing less than the second wave of the information
technology revolution.
[End Pull Quote]
BIOTECHNOLOGY BREAKTHROUGH
THE SEQUENCING OF THE HUMAN GENOME
[photo of the human genome]
[Begin Pull Quote]
"Your grandfather made his money in railroads. Your dad struck it rich in oil
stocks. And you? You scored big with Internet phenoms." Your children may make
it big in biotechnology.
[End Pull Quote]
In June of this year, scientists produced a rough but complete map of the human
genome, an endeavor that's been going on for the past ten years. It is expected
to benefit mankind and at the same time create new wealth for investors.
Uncovering the underpinnings of disease will pave the way for the discovery and
development of new tests to accurately diagnose individual predisposition to
medical conditions and of new drugs to treat disease, scientists say.
As Fortune magazine put it at the end of last year: "Your grandfather made his
money in railroads. Your dad struck it rich in oil stocks. And you? You scored
big with Internet phenoms." Your children may well make it big in biotechnology
or bioinformatics (a new discipline which marries computer science and
biology.)
But it won't be as easy or straightforward as many investment enthusiasts would
have you believe. "The biology of the human body is complicated," says Rick
Beleson, biotechnology analyst for the fund. "Unlike development cycles in the
computer industry, it usually takes many years to develop a drug and bring it
to market."
THE LONG ROAD TO A PAYOFF
In 1975, medical researchers were excited by the potential of monoclonal
antibodies - and a number of companies were founded to capitalize on the new
technology for creating them. Researchers envisioned they could create
antibodies directed against a single antigen on a cancer cell and destroy the
target without damaging normal tissue. "But scientific and financial
disappointments ensued," Rick says. "It wasn't until quite recently, just in
the past three years, that monoclonal antibodies have begun to pay off with
commercial successes. It's taken almost 25 years."
It could also take a long time to produce useful applications from the mapping
of the human genome - the operating system for all of human biology. "The
sequencing of the human genome is like going into a book store, buying a book,
and finding that all the letters are there, but there is no punctuation and no
spacing," says Rick. "It's very hard to read. You have to figure out where the
spacing and punctuation is, and then you have to read the book, and decide what
the story is all about."
Even if desired applications of the new genetics come to fruition, people may
live longer lives - but not necessarily happier lives.
A symposium of senior pharmaceutical and biotechnology executives in July
warned that extending life doesn't mean that older people won't continue to
face problems with memory, cognition and anxiety. We need to fix the mind as
well as the body.
UNDERSTANDING THE SCIENCE
The Growth Fund of America tries hard to mitigate risk in this high-risk area
of investing. "We try to invest when companies are more mature," says Rick.
"Hopefully, it's when companies are in the later stages of clinical testing of
their pharmaceuticals. But sometimes that's not possible. So we try to
understand the science behind the drugs that are in development. Some cases are
cut-and-dried. Here is a pathway that causes a disease and here is a drug that
blocks that pathway. Other cases are more complicated. Timing when to invest
can be challenging. If you invest too early, you run the risk of losing your
entire investment. If you get in too late, you can miss the big growth in stock
price."
[photo of a DNA strand]
[Begin Pull Quote]
"We try to understand the science behind the drugs that are in development."
(rick beleson)
[End Pull Quote]
CHOOSING THE RIGHT COMPANIES
LOOKING AHEAD TO THE FUTURE
[photo of satellite dishes on a hillside]
[Begin Pull Quote]
"We're value investors in a growth world. With our approach, volatility can be
a friend. We can buy lots of shares of the right company during a market
decline, when they are giving them away." (jim drasdo)
[End Pull Quote]
Investing in these volatile, emerging fields is best done by professionals who
understand the potential and the risk. "The Growth Fund of America invests in
the future with an eye for value," says Jim Drasdo, president of the fund.
"We're value investors in a growth world. With our approach, volatility can be
a friend. We can buy lots of shares of the right company during a market
decline, when they are giving them away."
The fund's analysts and portfolio counselors have the flexibility to move in
and out of industries or companies when the time seems right. "This is a fund
that does not worry about the dividend as a principal measure of value, so we
have a broader list of securities to choose from," says Mike Kerr, portfolio
counselor. In these explosive industries of the future, having the flexibility
to move quickly has been an important ingredient in successful growth
investing.
AN AMERICAN FUNDS SYSTEM THAT WORKS
One of the keys to The Growth Fund of America's success is that it follows a
unique system of management that was pioneered more than 40 years ago by
Capital Research. Employed throughout The American Funds Group, it's called the
"multiple portfolio counselor system." The system is designed to enable
investment professionals to act on their strongest convictions.
This approach divides the fund's assets into eight distinct parts. The fund's
seven portfolio counselors manage their parts independently, subject to overall
fund guidelines and objectives. They invest each portion as if it were an
entire fund. An eighth segment is assigned to the fund's research analysts. In
addition to providing investment ideas to portfolio counselors, the analysts
also invest in their own best research ideas. Analysts cover specific
industries, from biotechnology to fiber optics and satellite transmission,
while portfolio counselors are "big picture" investors who select companies
from a wide range of industries.
AN EXPERIENCED CREW OF PROS
The fund's portfolio counselors are all veterans, with an average of 26 years
experience in the investment business and 25 years at Capital Research. "We've
seen tough times as well as good times," says Jim Drasdo. "While we always try
to do as well as we can, we always take risk into consideration."
The portfolio counselors and research analysts bring different investment
styles, ideas and strengths to the management of the fund. Since they all
select companies for the fund, the result is a diverse mix of stocks chosen
from many different perspectives. Shareholders benefit, because this approach
allows them to participate in the growth of a wide variety of companies.
Judging by its short-, medium- and long-term records, this system seems to fit
The Growth Fund of America especially well. The fund's annualized returns have
outpaced Standard & Poor's 500 Stock Composite Index over these three time
periods: one year: 53.5% to 16.3%; five years: 28.1% to 24.0%; and over the
fund's lifetime: 18.9% to 14.9%.
The bottom line is investing in the future and choosing the right companies.
[photo of two technological wires]
[Begin Pull Quote]
This system is designed to enable investment professionals to act on their
strongest convictions.
[End Pull Quote]
WHAT MAKES THE AMERICAN FUNDS DIFFERENT?
[begin sidebar]
[blurred photo of the United States of America flag]
As a shareholder in The Growth Fund of America, you are also a member of The
American Funds Group, the nation's third-largest mutual fund family. You won't
find us advertised, yet thousands of financial advisers recommend the American
Funds for their clients' serious money - money set aside for education, a home,
retirement and other important dreams.
[end sidebar]
What the 29 funds in our group have in common is a commitment to your best
interests and the proven approach of our investment adviser, Capital Research
and Management Company. In business since 1931, Capital's calling cards
include:
- A long-term, value-oriented approach: Rather than follow short-term fads, we
rely on our own intensive research to find well-managed companies with
reasonably priced securities and solid, long-term potential. Despite our size,
we offer relatively few funds compared with many large fund families, allowing
us to maintain a careful focus on our objectives and enabling you to benefit
from economies of scale.
- An unparalleled global research effort: We opened our first overseas office
in 1962, well before most mutual funds began investing internationally. Today,
the American Funds draw on one of the industry's most globally integrated
research networks. Capital Research spends substantial resources getting to
know companies and industries around the world.
- A multiple portfolio counselor system: More than 40 years ago, we developed a
unique strategy for managing investments that blends teamwork with individual
accountability. Every American Fund is divided among a number of portfolio
counselors, each of whom manages his or her portion independently, within each
fund's objectives; in most cases, research analysts manage a portion as well.
Over time, this method has contributed to consistency of results and continuity
of management.
- Experienced investment professionals: More than 75% of the portfolio
counselors who serve the American Funds were in the investment business before
the sharp stock market decline in October 1987. Long tenure and experience
through a variety of market conditions mean we aren't "practicing" with your
money.
- A commitment to low operating expenses: You can't control market returns, but
you can control what you invest in and how much you pay to own it. American
Funds provide exceptional value for shareholders, with operating expenses that
are among the lowest in the mutual fund industry. Our portfolio turnover rates
are low as well, keeping transaction costs and tax consequences contained.
A PORTFOLIO FOR EVERY INVESTOR
Most financial advisers suggest that investors balance their portfolios by
investing across several types of investments. Which mix is right for you? That
depends on a number of things - including your risk tolerance, investment time
horizon and financial goals. The American Funds Group offers 29 funds with an
array of investment objectives to help you and your financial adviser build a
portfolio specifically tailored to your needs.
GROWTH FUNDS
Emphasis on long-term growth through stocks
AMCAP Fund(r)
EuroPacific Growth Fund(r)
The Growth Fund of America(r)
The New Economy Fund(r)
New Perspective Fund(r)
New World Fund(sm)
SMALLCAP World Fund(r)
GROWTH-AND-INCOME FUNDS
Emphasis on long-term growth and dividends through stocks
American Mutual Fund(r)
Capital World Growth and Income Fund(sm)
Fundamental Investors(sm)
The Investment Company of America(r)
Washington Mutual Investors Fund(sm)
EQUITY-INCOME FUNDS
Emphasis on above-average income and growth through stocks and/or bonds
Capital Income Builder(r)
The Income Fund of America(r)
BALANCED FUND
Emphasis on long-term growth and current income through stocks and bonds
American Balanced Fund(r)
INCOME FUNDS
Emphasis on current income through bonds
American High-Income Trust(sm)
The Bond Fund of America(sm)
Capital World Bond Fund(r)
Intermediate Bond Fund of America(r)
U.S. Government Securities Fund(sm)
TAX-EXEMPT INCOME FUNDS
Emphasis on tax-free current income through municipal bonds
American High-Income Municipal Bond Fund(r)
Limited Term Tax-Exempt Bond Fund of America(sm)
The Tax-Exempt Bond Fund of America(r)
State-specific tax-exempt funds:
The Tax-Exempt Fund of California(r)
The Tax-Exempt Fund of Maryland(r)
The Tax-Exempt Fund of Virginia(r)
MONEY MARKET FUNDS
The Cash Management Trust of America(r)
The Tax-Exempt Money Fund of America(sm)
The U.S. Treasury Money Fund of America(sm)
For more complete information about any of the funds, including charges and
expenses, please obtain a prospectus from your financial adviser, download one
from our Web site at www.americanfunds.com, or phone the funds' transfer agent,
American Funds Service Company at 800/421-0180. Please read the prospectus
carefully before you invest or send money. For more information, ask your
financial adviser for a copy of our brochure A Portfolio for Every Investor.
[blurred photo of the star section of the United States of America flag]
[Begin Sidebar]
We also offer a full line of retirement plans and variable annuities.
[End Sidebar]
The Growth Fund of America, Inc.
Investment Portfolio, August 31, 2000
[begin pie chart]
<TABLE>
<S> <C> <C> <C>
Percent
of Net
Largest Industry Holdings Assets
Electronic Components 15.78%
Health & Personal Care 12.63
Broadcasting & Publishing 11.81
Insurance 5.92
Data Processing & Reproduction 4.93
Other Industries 34.61
Cash & Equivalents 14.32
[end pie chart]
[begin table]
Largest Equity Holdings
Viacom 3.31%
Time Warner 2.90
PMC-Sierra 2.59
Texas Instruments 2.29
American International Group 2.04
Pfizer 1.95
Corning 1.92
Micron Technology 1.75
Palm 1.71
Fannie Mae 1.52
[end table]
[begin table]
Market Percent
Equity Securities (Common & Value of Net
Preferred Stocks) Shares (000) Assets
ELECTRONIC COMPONENTS - 15.78%
PMC-Sierra, Inc. (1) 4,513,200 $1,065,115 2.59
Texas Instruments Inc. 14,050,000 940,472 2.29
Corning Inc. 2,409,800 790,264 1.92
Micron Technology, Inc. (1) 8,810,000 720,217 1.75
Analog Devices, Inc. (1) 4,066,666 408,700 .99
Microchip Technology Inc. (1)(2) 4,012,500 273,101 .66
LSI Logic Corp. (1) 7,000,000 251,562 .61
Linear Technology Corp. 3,236,000 232,790 .57
Solectron Corp. (1) 3,884,000 175,994 .43
Intel Corp. 2,300,000 172,213 .42
Motorola, Inc. 4,276,500 154,221 .38
Vitesse Semiconductor Corp. (1) 1,700,000 150,981 .37
Seagate Technology (1) 2,500,000 148,437 .36
Altera Corp. (1) 2,100,000 136,106 .33
Adaptec, Inc. (1)(2) 5,050,000 123,725 .30
Taiwan Semiconductor Manufacturing 24,088,000 104,578 .25
Co. Ltd. (Taiwan)(1)
Redback Networks Inc. (1) 600,000 89,625 .22
ON Semiconductor Corp.(1) 5,250,000 89,250 .22
Maxim Integrated Products, Inc. (1) 900,000 78,919 .19
Sanmina Corp. (1) 600,000 70,800 .17
SCI Systems, Inc.(1) 1,108,800 68,468 .17
Dallas Semiconductor Corp. 1,600,000 66,200 .16
Jabil Circuit, Inc. (1) 900,000 57,431 .14
Fairchild Semiconductor Corp., Class A (1) 1,050,000 41,738 .10
Quantum Corp.-Hard Disk Drive (1) 2,100,000 20,475
Quantum Corp. - DLT & Storage Systems (1) 1,513,700 20,530 .10
Murata Manufacturing Co., Ltd. (Japan) 125,000 19,149 .05
Cypress Semiconductor Corp. (1) 300,000 14,831 .04
HEALTH & PERSONAL CARE - 12.63%
Pfizer Inc 18,500,000 800,125 1.95
Cardinal Health, Inc., Class A 6,805,000 556,734 1.36
Pharmacia Corp. (merger of Monsanto Co. 9,158,750 536,359 1.31
and Pharmacia & Upjohn, Inc.)
American Home Products Corp. 7,625,000 413,180 1.01
Forest Laboratories, Inc. (1) 3,756,700 367,687 .89
AstraZeneca PLC (United Kingdom) 7,090,000 319,792
AstraZeneca PLC (ADR) 380,000 17,314 .82
Millennium Pharmaceuticals, Inc. (1) 1,700,000 243,312 .59
Guidant Corp. (1) 3,550,000 238,959 .58
Gillette Co. 6,500,000 195,000 .47
Sepracor Inc. (1) 1,654,800 182,028 .44
IVAX Corp.(1) 4,812,000 166,616 .40
Elan Corp., PLC (ADR) (Ireland)(1) 2,770,000 161,526 .39
Medlmmune, Inc. (1) 1,500,000 126,188 .31
Bristol-Myers Squibb Co. 2,350,000 124,550 .30
Enzon, Inc. (1) 1,880,000 114,445 .28
Cephalon Inc.(1) 1,690,000 85,028 .21
Chiron Corp. (1) 1,500,000 81,094 .20
Sanofi-Synthelabo (France) 1,650,000 80,222 .20
Celera Genomics Group (1) 728,800 79,029 .19
Amylin Pharmaceuticals, Inc. (1)(3) 3,000,000 40,688 .10
IDEXX Laboratories, Inc.(1) 1,400,000 36,575 .09
ILEX Oncology, Inc. (1)(3) 1,040,000 34,320 .08
Genentech, Inc. (1) 168,200 32,042 .08
Becton, Dickinson and Co. 1,000,000 30,125 .07
Maxim Pharmaceuticals, Inc. (1) 478,500 29,278 .07
Medtronic, Inc. 560,000 28,700 .07
Avon Products, Inc. 713,500 27,960 .07
Guilford Pharmaceuticals, Inc.(1) 900,000 24,075 .06
SICOR Inc.(1) 1,694,702 16,417 .04
BROADCASTING & PUBLISHING - 11.81%
Viacom Inc., Class B (1) 18,548,588 1,248,552
Viacom Inc., Class A (1) 1,629,400 110,392 3.31
Time Warner Inc. 13,929,600 1,190,981 2.90
Clear Channel Communications, Inc. (1) 8,283,000 599,482 1.46
News Corp. Ltd., preferred 6,353,750 281,153
(ADR) (Australia)
News Corp. Ltd. (ADR) 5,450,000 286,806 1.38
Fox Entertainment Group, Inc., Class A (1) 8,720,000 252,335 .62
USA Networks, Inc. (1) 9,700,000 233,406 .57
Infinity Broadcasting Corp.(1) 5,573,300 211,089 .51
Nippon Television Network Corp. (Japan) 252,920 144,729 .35
AT&T Corp.Liberty Media Group, Class A (1) 5,400,000 115,425 .28
Chris-Craft Industries, Inc. (1) 1,292,176 101,113 .25
UnitedGlobalCom, Inc., Class A (1) 1,400,000 53,638 .13
BHC Communications, Inc., Class A (1) 62,840 9,615 .02
E.W. Scripps Co., Class A 150,000 7,603 .02
Ziff-Davis Inc. (1) 331,200 3,643 .01
Sinclair Broadcast Group, Inc., Class A (1) 143,100 1,726 .00
INSURANCE - 5.92%
American International Group, Inc. 9,400,000 837,775 2.04
Marsh & Mclennan Companies, Inc. 4,964,900 589,582 1.43
Berkshire Hathaway Inc., Class A (1) 8,200 473,140 1.15
XL Capital Ltd., Class A (Incorporated 3,285,000 226,460 .55
in Bermuda)
Progressive Corp. 2,035,000 154,278 .38
Protective Life Corp. 2,763,600 79,453 .19
MGIC Investment Corp. 600,000 35,288 .09
Mercury General Corp. 1,275,000 34,983 .09
DATA PROCESSING & REPRODUCTION - 4.93%
Palm, Inc. (1) 15,978,058 703,034 1.71
Intuit Inc. (1) 3,541,300 212,035 .52
PeopleSoft, Inc. (1) 5,900,000 190,275 .46
Cadence Design Systems, Inc. (1) 7,749,000 164,666 .40
Microsoft Corp. (1) 2,000,000 139,625 .34
Computer Associates International, Inc. 3,975,000 126,206 .31
Fujitsu Ltd. (Japan) 3,500,000 101,454 .25
Lexmark International Group, 1,200,000 81,375 .20
Inc., Class A (1)
International Business Machines Corp. 600,000 79,200 .19
3Com Corp. (1) 4,350,000 72,319 .18
Gateway, Inc. (1) 811,000 55,229 .13
Compaq Computer Corp. 1,000,000 34,063 .08
Storage Technology Corp. (1) 2,000,000 31,625 .08
Autodesk, Inc. 901,000 25,341 .06
BMC Software, Inc. (1) 300,000 8,100 .02
BUSINESS SERVICES - 4.71%
United Parcel Service, Inc., Class B 4,560,500 252,823 .62
Flextronics International Ltd. 2,600,000 216,613 .53
(USA --- Incorporated in Singapore)(1)
FDX Corp. (1) 4,700,000 189,645 .46
Cendant Corp. (1) 12,018,000 158,487 .39
Yahoo Inc.(1) 1,000,000 121,500 .30
Sabre Group Holdings., Class A (1) 4,319,848 120,416 .29
VerticalNet, Inc.(1) 1,800,000 95,850 .23
Robert Half International, Inc. (1) 3,000,000 95,437 .23
Genuity Inc., Class A(1) 8,499,100 73,305 .18
PSINet Inc. (1) 3,950,000 69,372 .17
Waste Management, Inc. 3,550,000 67,228 .16
Allied Waste Industries, Inc. (1) 7,250,000 66,609 .16
United Rentals, Inc. (1) 3,000,000 62,250 .15
Covad Communications Group, Inc. (1) 3,500,000 57,094 .14
Internet Capital Group, Inc.(1) 1,350,000 47,081 .11
Paychex, Inc. 1,035,000 46,187 .11
Snyder Communications, Inc. (1) 1,500,000 41,062 .10
Concord EFS, Inc. (1) 1,000,000 32,125 .08
Loudcloud, Inc., convertible 3,600,799 30,714 .08
preferred, Series C(1)(3)(4)
Consumer Financial Network, Inc., 6,500,000 26,000 .06
convertible preferred, Series C(1)(3)(4)
iXL Enterprises, Inc.(1) 2,675,000 25,580 .06
ServiceMaster Co. 2,000,000 19,375 .05
X.com Corp., convertible preferred, 5,400,000 14,850 .04
Series C(1)(3)(4)
Ventiv Health, Inc. (1) 333,333 4,458 .01
ELECTRICAL & ELECTRONICS - 4.27%
Juniper Networks, Inc. (1) 2,100,000 448,875 1.09
Nortel Networks Corp. (Canada) 5,244,480 427,753 1.04
Cisco Systems, Inc.(1) 4,100,000 281,362 .69
Nokia Corp., Class A (ADR) (Finland) 5,720,000 257,043 .63
Telefonaktiebolaget LM Ericsson, 8,000,000 164,000 .40
Class B (ADR) (Sweden)
NEC Corp. (Japan) 3,183,000 91,071 .22
Lucent Technologies Inc. 2,000,000 83,625 .20
LEISURE & TOURISM - 3.82%
Walt Disney Co. 14,485,000 564,010 1.37
Starbucks Corp. (1) 9,250,000 338,781 .83
Seagram Co. Ltd. (Canada) 4,141,200 249,248 .61
Carnival Corp. 10,147,900 202,324 .49
MGM Mirage, Inc.(3) 4,058,500 139,511
MGM Mirage, Inc. 1,199,800 41,243 .44
Pixar (1) 1,000,000 33,000 .08
ELECTRONIC INSTRUMENTS - 3.36%
KLA - Tencor Corp. (1) 4,500,000 295,313 .72
Corvis Corp. (1)(3)(4) 2,980,260 262,980
Corvis Corp. (1) 202,300 21,001 .69
PE Biosystems Group 2,429,600 239,012 .58
Applied Materials, Inc. (1) 2,550,000 220,097 .54
Affymetrix, Inc. (1)(3) 2,000,000 158,000 .38
Teradyne, Inc.(1) 1,300,000 84,256 .20
Nikon Corp. (Japan) 2,500,000 76,689 .19
Conexant Systems, Inc.(1) 500,000 18,594 .05
TyCom Ltd.(1) 103,200 4,296 .01
FINANCIAL SERVICES - 2.36%
Fannie Mae 11,650,000 626,187 1.52
Capital One Financial Corp. 2,131,200 128,538 .31
Providian Financial Corp. 700,000 80,456 .20
USA Education Inc. (formerly 1,880,000 73,673 .18
SLM Holding Corp.)
Household International, Inc. 1,300,000 62,400 .15
HEALTH CARE PROVIDERS & SERVICES - 2.29%
HCA - The Healthcare Co. (formerly 17,863,700 616,298 1.50
Columbia/HCA Healthcare Corp.)
WellPoint Health Networks Inc. (1) 1,745,100 150,624 .37
Cintas Corp. 2,025,000 84,164 .21
Universal Health Services, 1,050,000 74,287 .18
Inc., Class B (1)
Quintiles Transnational Corp. (1) 1,000,000 13,938 .03
ENERGY SOURCES - 1.97%
EOG Resources Inc. 3,550,000 135,788 .33
Devon Energy Corp. 2,149,600 125,886 .31
Norsk Hydro AS (ADR) (Norway) 2,465,000 106,765 .26
Suncor Energy Inc. (Canada) 3,805,485 85,936 .21
Broken Hill Proprietary Co. 5,342,633 58,236 .14
Ltd. (Australia)
Shell Canada Ltd., Class A (Canada) 2,500,000 56,880 .14
Burlington Resources Inc. 1,418,800 55,777 .14
Pogo Producing Co. 1,994,400 53,599 .13
Enterprise Oil PLC (United Kingdom) 6,500,000 51,582 .12
Talisman Energy Inc. (Canada)(1) 1,067,700 35,869 .09
Murphy Oil Corp. 439,000 29,303 .07
Petro-Canada (Canada) 600,000 12,734 .03
MERCHANDISING - 1.80%
Lowe's Companies, Inc. 10,800,000 483,975 1.18
Limited Inc. 6,900,000 138,000 .34
Albertson's, Inc. 2,680,000 57,620 .14
Gap, Inc. 1,800,000 40,387 .10
Walgreen Co. 300,000 9,863 .02
Circuit City Stores, Inc. - Circuit 200,000 5,188 .01
City Group
Lands' End, Inc. (1) 120,800 2,952 .01
BEVERAGES & TOBACCO - 1.66%
Philip Morris Companies Inc. 12,450,000 368,831 .90
Coca-Cola Co. 3,669,800 193,123 .47
PepsiCo, Inc. 2,250,000 95,906 .23
R.J. Reynolds Tobacco Holdings, Inc. 641,666 23,020 .06
TRANSPORTATION: AIRLINES - 1.30%
Southwest Airlines Co. 14,490,518 327,848 .80
AMR Corp. (1) 3,279,100 107,595 .26
Delta Air Lines, Inc. 2,030,000 100,485 .24
DIVERSIFIED TELECOMMUNICATION
SERVICES - 0.90%
Sprint FON Group 3,500,000 117,250 .28
AT&T Corp. 3,000,000 94,500 .23
WorldCom, Inc. (formerly MCI 2,000,000 73,000 .18
WorldCom, Inc.) (1)
Intermedia Communications Inc.(1) 2,372,500 49,229 .12
Broadview Networks Holdings, Inc., 1,588,972 21,000 .05
convertible preferred, Series E(1)(3)(4)
Rhythms NetConnections Inc. (1) 1,861,300 16,752 .04
IT CONSULTING & SERVICES - 0.82%
Computer Sciences Corp.(1) 2,350,000 185,797 .45
Acxiom Corp. (1) 3,863,200 98,512 .24
Modis Professional Services, Inc. (1) 4,000,000 27,500 .07
Affiliated Computer Services, Inc., 500,000 23,281 .06
Class A (1)
BANKING - 0.76%
Bank of America Corp. 2,500,000 133,906 .33
Wells Fargo & Co. 2,000,000 86,375 .21
Charter One Financial, Inc. 2,000,000 47,500 .11
Washington Mutual, Inc. 1,300,000 45,500 .11
FOOD & HOUSEHOLD PRODUCTS - 0.72%
Nabisco Group Holdings Corp. 6,550,000 183,809 .45
Keebler Foods Co. 1,632,800 74,803 .18
Dole Food Co., Inc. 2,721,900 38,447 .09
WIRELESS TELECOMMUNICATION
SERVICES - 0.56%
Crown Castle International Corp.(1) 6,651,000 230,707 .56
ENERGY EQUIPMENT - 0.33%
Schlumberger Ltd. (Netherlands Antilles) 800,000 68,250 .16
BJ Services Co. (1) 600,000 40,200 .10
Baker Hughes Inc.(1) 766,500 28,025 .07
MISCELLANEOUS MATERIALS &
COMMODITIES - 0.30%
Sealed Air Corp. (1) 1,650,000 84,666 .21
Owens-Illinois, Inc.(1) 3,000,000 39,187 .09
TRANSPORTATION: RAIL & ROAD - 0.27%
Burlington Northern Santa Fe Corp. 4,000,000 89,500 .22
Wisconsin Central Transportation Corp. (1) 1,650,000 22,069 .05
RECREATION OTHER CONSUMER
PRODUCTS - 0.17%
Hasbro, Inc. 3,950,000 48,634 .12
American Greetings Corp., Class A 1,176,400 21,911 .05
CHEMICALS - 0.12%
Millennium Chemicals Inc. 1,425,000 23,512 .05
Air Products and Chemicals, Inc. 450,000 16,341 .04
A. Schulman, Inc. 965,625 11,648 .03
UTILITIES: ELECTRIC & GAS - 0.12%
Questar Corp. 2,225,000 48,255 .12
AEROSPACE & MILITARY TECHNOLOGY - 0.08%
Bombardier Inc., Class B (Canada) 2,000,000 33,007 .08
INDUSTRIAL COMPONENTS - 0.05%
Danaher Corp. 400,000 22,475 .05
BUILDING MATERIALS & COMPONENTS - 0.04%
Johns Manville International Group, Inc. 1,500,000 18,750 .04
Miscellaneous - 1.83%
Other equity securities in initial 753,256 1.83
period of acquisition
Total Equity Securities
(cost: $21,004,778,000)
35,209,866 85.68
Principal Market Percent
Amount Value of Net
Short-Term Securities (000) (000) Assets
Corporate Short-Term Notes - 9.21%
Coca-Cola Co. 6.47%-6.54% $150,000 148,344 .36
due 9/8-11/28/2000
AT&T Corp. 6.47%-6.59% due 9/5-11/15/2000 147,010 145,943 .35
Gannett Co., Inc. 6.49%-6.50% 144,050 143,145 .35
due 9/14-10/19/2000 (3)
BellSouth Capital Funding Corp. 142,000 140,614 .34
6.47%-6.55% due 9/14-11/15/2000(3)
Gillette Co. 6.48%-6.50% 135,000 133,919 .33
due 9/15-11/17/2000 (3)
Alcoa Inc. 6.47%-6.58% due 9/5-11/14/2000 133,500 132,204 .32
Motorola, Inc. 6.51%-6.58% 132,685 131,420 .32
due 9/26-11/7/2000
Bank of America Corp. 6.55%-6.59% 125,000 123,636 .30
due 10/11/2000-1/11/2001
CIT Group Holdings, Inc. 6.49%-6.61% 125,000 124,277 .30
due 9/1-11/8/2000
GMAC Commercial Mortgage Securities, 122,300 121,399 .30
Inc. 6.51%-6.57% due 9/1-10/23/2000
Preferred Receivables Funding Corp. 118,700 118,206 .29
6.50%-6.58% due 9/8-10/2/2000 (3)
Ford Motor Credit Co. 6.49%-6.51% 116,900 115,983 .28
due 10/6-10/20/2000
Lucent Technologies Inc. 6.47%-6.50% 111,900 111,304 .27
due 9/27-10/13/2000
Park Avenue Receivables Corp. 102,000 101,665 .25
6.50%-6.51% due 9/7/-10/3/2000 (3)
Marsh USA Inc. 6.48%-6.53% 100,000 98,475 .24
due 10/17-12/12/2000 (3)
IBM Credit Corp. 6.51% due 10/2-11/3/2000 95,000 94,187 .23
Eastman Kodak Co. 6.50%-6.56%
due 9/8-10/16/2000 90,000 89,602 .22
GE Financial Assurance Holdings Inc. 90,000 89,528 .22
6.53%-6.60% due 9/20-10/10/2000 (3)
Wal-Mart Stores, Inc. 6.50%-6.55% 90,000 89,316 .22
due 9/19-10/24/2000 (3)
SBC Communications Inc. 6.47%-6.50% 88,700 88,146 .21
due 9/25-10/12/2000 (3)
Household Finance Corp. 6.51%-6.53% 80,000 79,196 .19
due 10/18-10/30/2000
International Lease Finance Corp. 79,400 78,699 .19
6.48%-6.51% due 10/6-10/24/2000
Bell Atlantic Financial Services, 73,100 72,833 .18
Inc. 6.51%-6.55% due 9/8-10/5/2000
Merck & Co., Inc. 6.47% due 9/19-9/20/2000 71,800 71,549 .17
Procter & Gamble Co. 71,700 71,234 .17
6.47%-6.50% due 9/28-10/25/2000
American Express Credit Corp. 6.50%-6.51% 70,000 69,857 .17
due 9/1-9/19/2000
Corporate Asset Funding Co. Inc. 68,500 68,218 .17
6.53%-6.61% due 9/12-10/11/2000 (3)
Emerson Electric Co. 6.53% 66,500 66,078 .16
due 10/5/2000 (3)
Duke Energy Corp. 6.49%-6.50% 65,000 64,504 .16
due 10/12-10/13/2000
Minnesota Mining and Manufacturing Co. 54,800 54,568 .13
6.54%-6.55% due 9/21-9/26/2000
USAA Capital Corp. 6.48%-6.55% 53,100 52,575 .13
due 9/6-11/13/2000
General Electric Capital Services, Inc. 53,200 52,462 .13
6.48%-6.49% due 11/13-11/17/2000
E.I. Du Pont de Nemours and Co. 50,800 50,273 .12
6.47%-6.49% due 10/16-11/8/2000
General Dynamics Corp. 6.49% 51,000 50,119 .12
due 12/5/2000 (3)
Morgan Guaranty Trust Company 50,000 50,001 .12
6.61% 10/11/00
Associates First Capital Corp. 50,000 49,547 .12
6.53% due 10/20/2000
Campbell Soup Co. 6.56%-6.57% 45,300 44,865 .11
due 10/10-12/7/2000
Equilon Enterprises, LLC 6.51%-6.54% 41,479 41,321 .10
due 9/7-10/4/2000
A.I. Credit Corp. 6.47%-6.56% 40,000 39,851 .10
due 9/14-9/27/2000
Avon Capital Corp. 6.57% due 9/11/2000 (3) 39,000 38,922 .09
H.J. Heinz Co. 6.48%-6.49% 36,000 35,829 .09
due 9/5-10/23/2000
Hershey Foods Corp. 6.48%-6.50% 36,300 35,824 .09
due 10/3-11/20/2000
Anheuser-Busch Companies, Inc. 6.59% 30,000 29,664 .07
due 11/1/2000
Knight-Ridder, Inc. 6.53% due 1/26/2001 30,000 29,191 .07
Pitney Bowes Credit Corp. 6.49% 25,000 24,950 .06
due 9/11/2000
John Hancock Capital Corp. 6.48% 25,000 24,811 .06
due 10/13/2000 (3)
Ciesco LP 6.48%-6.53% due 9/19-10/6/2000 21,650 21,542 .05
Verizon Global Funding 6.50% due 11/7/2000 20,609 20,355 .05
Archer Daniels Midland Co. 6.57% 20,000 19,949 .05
due 9/14/2000
Motiva Enterprises LLC 6.50% due 9/26/2000 20,000 19,906 .05
Pharmacia Corp. 6.49% due 10/20/2000 16,800 16,648 .04
3,786,654 9.21
Federal Agency Discount Notes - 5.19%
Fannie Mae 6.37%-6.50% 811,585 798,137 1.94
due 9/7/2000-2/22/2001
Freddie Mac 6.39%-6.46% 671,297 663,447 1.62
due 9/14/2000-2/14/2001
Federal Home Loan Banks 6.39%-6.48% 577,641 571,382 1.39
due 9/6/2000-2/16/2001
SLM Holding Corp. 6.67%-6.77% 100,000 99,965 .24
due 1/18/-2/15/2001(5)
2,132,931 5.19
Non-U.S. CURRENCY - 0.01%
New Taiwanese Dollar NT$116,554 3,762 .01
Total Short-Term Securities 5,923,347 14.41
(cost: $5,923,071,000)
Total Investment Securities 41,133,213 100.09
(cost:$26,927,849,000)
Excess of payables over cash 38,580 .09
and receivables
NET ASSETS $41,094,633 100.00
1 Non-income-producing security.
2 The fund owns 5.07% of the outstanding voting securities of Microchip Technology,
Inc. and 5.09% of the outstanding voting securities of Adaptec, Inc. and thus is considered
an affiliate as defined under the Investment Company Act of 1940.
3 Purchased in a private placement transaction; resale to the public
may require registration or sale only to qualified institutional buyers.
4 Valued under procedures established by the Board of Directors.
5 Coupon rate may change periodically.
The descriptions of the companies shown in the portfolio, which were obtained
from published reports and other sources believed to be reliable, are
supplemental and are not covered by the Independent Auditors' Report.
ADR = American Depositary Receipt
See Notes to Financial Statements
Growth Fund of America
August 31, 2000
Equity securities
appearing in the portfolio
since February 29, 2000
Acxiom
Affiliated Computer Services
Baker Hughes
Berkshire Hathaway
Bristol-Myers Squibb
Broadview Networks
Broken Hill
Burlington Northern Santa Fe
Burlington Resources
Cephalon
Chiron
Coca-Cola
Conexant Systems
Consumer Financial Network
Covad Communications Group
Enzon
Gap
Genuity
Gillette
ILEX Oncology
Infinity Broadcasting
Intermedia Communications
Internet Capital Group
Intuit
IVAX
iXL Enterprises
Loudcloud
Marsh & Mclennan Companies
Maxim Pharmaceuticals
MGM Mirage
Murphy Oil
Nikon
Norsk Hydro
ON Semiconductor
Owens-Illinois
Palm
Pixar
Progressive
PSINet
Sanofi-Synthelabo
TyCom
Ventiv Health
VerticalNet
Walgreen
Walt Disney
X.com
Yahoo!
Equity securities
eliminated from the portfolio
since February 29, 2000
ADVANTEST
AMFM
Amgen
Apollo Group
Applied Micro Circuits
Biogen
Cablevision Systems
Consolidated Stores
Continental Airlines
Dell Computer
FleetBoston
Galileo International
Gilead Sciences
Harrah's
International Flavors & Fragrances
MMC Networks
National Computer Systems
NIKE
NTT Mobile Communications Network
Omnicare
Oracle
Rohm
SFX Entertainment
Synder Communications, Inc. - Circle.com
Teleglobe
Thermo Electron
Transkaryotic Therapies
[end table]
The Growth Fund of America
Financial Statements
[begin table]
</TABLE>
<TABLE>
<S> <C> <C>
Statement of Assets and Liabilities
at August 31, 2000 (dollars in thousands)
Assets:
Investment securities at market
(cost: $26,927,849) $41,133,213
Cash 760
Receivables for--
Sales of investments $ 88,343
Sales of fund's shares 132,435
Dividends and accrued interest 16,500 237,278
41,371,251
Liabilities:
Payables for--
Purchases of investments 207,131
Repurchases of fund's shares 36,513
Management services 10,331
Other expenses 22,643 276,618
Net Assets at August 31, 2000-- 41,094,633
Total authorized capital
stock--2,000,000,000 shares
Class A shares, $0.001 par value:
Net Assets $40,670,840
Shares outstanding 1,132,593,360
Net asset value per share $35.91
Class B shares, $0.001 par value:
Net Assets $423,793
Shares outstanding 11,840,360
Net asset value per share $35.79
See Notes to Financial Statements
Statement of Operations
for the year ended August 31, 2000 (dollars in thousands)
Investment Income:
Income:
Dividends $ 126,650
Interest 263,409
$ 390,059
Expenses:
Management services fee 97,125
Distribution expenses - Class A 75,719
Distribution expenses - Class B 798
Transfer agent fee - Class A 29,052
Transfer agent fee - Class B 80
Reports to shareholders 866
Registration statement and prospectus 2,780
Postage, stationery and supplies 5,097
Directors' fees 179
Auditing and legal fees 73
Custodian fee 1,033
Taxes other than federal income tax 1
Other expenses 276 213,079
Net investment income 176,980
Realized Gain and Unrealized
Appreciation on Investments:
Net realized gain 5,138,742
Net increase in unrealized appreciation
on investments:
Beginning of year 7,194,763
End of year 14,205,355 7,010,592
Net realized gain and unrealized
appreciation on investments 12,149,334
Net Increase in Net Assets Resulting
from Operations $ 12,326,314
See Notes to Financial Statements
Statement of Changes in Net Assets
(dollars in thousands)
Year Ended August 31
2000 1999
Operations:
Net investment income $ 176,980 $ 48,143
Net realized gain on investments 5,138,742 2,423,859
Net increase in unrealized appreciation
on investments 7,010,592 4,827,884
Net increase in net assets
resulting from operations 12,326,314 7,299,886
Dividends and Distributions Paid to
Shareholders:
Dividends from net investment income:
Class A (37,243) (59,245)
Class B - -
Distributions from net realized
gain on investments:
Class A (2,644,238) (1,454,805)
Class B - -
Total dividends and distributions (2,681,481) (1,514,050)
Capital Share Transactions:
Proceeds from shares sold 12,180,471 4,179,298
Proceeds from shares issued in
reinvestment of net investment income
dividends and distributions of net 2,584,000 1,460,168
realized gain on investments
Cost of shares repurchased (3,987,584) (2,550,833)
Net increase in net assets resulting
from capital share transactions 10,776,887 3,088,633
Total Increase in Net Assets 20,421,720 8,874,469
Net Assets:
Beginning of year 20,672,913 11,798,444
End of year (including undistributed
net investment income and
distributions in excess of net
investment income of $71,158
and $(660), respectively) $ 41,094,633 $ 20,672,913
See Notes to Financial Statements
</TABLE>
[end table]
THE GROWTH FUND OF AMERICA, INC.
NOTES TO THE FINANCIAL STATEMENTS
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION - The Growth Fund of America, Inc. (the "fund") is registered
under the Investment Company Act of 1940 as an open-end, diversified management
investment company. The fund invests in a wide range of companies that appear
to offer superior opportunities for growth of capital. The fund offers Class A
and Class B shares. Class A shares are sold with an initial sales charge of up
to 5.75%. Class B shares are sold without an initial sales charge but are
subject to a contingent deferred sales charge paid upon redemption. This charge
declines from 5% to zero over a period of six years. Class B shares have higher
distribution expenses and transfer agent fees than Class A shares. Class B
shares are automatically converted to Class A shares eight years after the date
of purchase. Holders of both classes of shares have equal pro rata rights to
assets and identical voting, dividend, liquidation and other rights, except
that each class bears different distribution and transfer agent expenses, and
each class shall have exclusive rights to vote on matters affecting only their
class.
SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared
in conformity with generally accepted accounting principles in the United
States which require management to make estimates and assumptions that affect
the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates. The following is a summary of the
significant accounting policies consistently followed by the fund in the
preparation of its financial statements:
SECURITY VALUATION - Equity securities, including depositary receipts, are
valued at the last reported sale price on the exchange or market on which such
securities are traded, as of the close of business on the day the securities
are being valued or, lacking any sales, at the last available bid price. In
cases where equity securities are traded on more than one exchange, the
securities are valued on the exchange or market determined by the investment
adviser to be the broadest and most representative market, which may be either
a securities exchange or the over-the-counter market.
Short-term securities maturing within 60 days are valued at amortized cost,
which approximates market value. Securities and assets for which
representative market quotations are not readily available are valued at fair
value as determined in good faith by a committee appointed by the Board of
Directors.
NON-U.S. CURRENCY TRANSLATION - Assets and liabilities initially expressed in
terms of non-U.S. currencies are translated into U.S. dollars at the prevailing
market rates at the end of the reporting period. Purchases and sales of
securities and income and expenses are translated into U.S. dollars at the
prevailing market rates on the dates of such transactions. The effects of
changes in non-U.S. currency exchange rates on investment securities and other
assets and liabilities are included with the net realized and unrealized gain
or loss on investment securities.
SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME - Securities transactions
are accounted for as of the trade date. Realized gains and losses from
securities transactions are determined based on specific identified cost.
Dividend income is recognized on the ex-dividend date, and interest income is
recognized on an accrual basis. Market discounts, premiums and original issue
discounts on fixed-income securities are amortized daily over the expected life
of the security.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions paid
to shareholders are recorded on the ex-dividend date.
ALLOCATIONS - Income, expenses (other than class-specific expenses) and
realized and unrealized gains and losses are allocated daily between Class A
and Class B based on their relative net asset values. Distribution expenses,
transfer agent fees and any other class-specific expenses, are accrued daily
and charged to the applicable share class.
2. NON-U.S. INVESTMENTS
INVESTMENT RISK - Investments in securities of non-U.S. issuers in certain
countries involve special investment risks. These risks may include, but are
not limited to, investment and repatriation restrictions, revaluation of
currencies, adverse political, social, and economic developments, government
involvement in the private sector, limited and less reliable investor
information, lack of liquidity, certain local tax law considerations, and
limited regulation of the securities markets.
TAXATION - Dividend income is recorded net of non-U.S. taxes paid. For the
year ended August 31, 2000, such non-U.S. taxes were $1,990,000.
CURRENCY GAINS AND LOSSES - Net realized currency gains on dividends and
other receivables and payables, on a book basis, were $493,000 for the year
ended August 31, 2000.
3. FEDERAL INCOME TAXATION - The fund complies with the requirements of the
Internal Revenue Code applicable to regulated investment companies and intends
to distribute all of its net taxable income and net capital gains for the
fiscal year. As a regulated investment company, the fund is not subject to
income taxes if such distributions are made. Required distributions are
determined on a tax basis and may differ from net investment income and net
realized gains for financial reporting purposes. In addition, the fiscal year
in which amounts are distributed may differ from the year in which the net
investment income and net realized gains are recorded by the fund.
As of August 31, 2000, net unrealized appreciation on investments for book and
federal income tax purposes aggregated $14,205,364,000; $15,385,803,000 related
to appreciated securities and $1,180,439,000 related to depreciated securities.
During the year ended August 31, 2000, the fund realized, on a tax basis, a net
capital gain of $5,139,281,000 on securities transactions.
Net gains related to non-U.S. currency transactions of $517,000 were treated as
an adjustment to ordinary income for federal income tax purposes. The cost of
portfolio securities for book and federal income tax purposes was
$26,927,849,000 at August 31, 2000.
4. FEES AND TRANSACTIONS WITH RELATED PARTIES
INVESTMENT ADVISORY FEE - The fee of $97,125,000 for management services was
incurred pursuant to an agreement with Capital Research and Management Company
(CRMC), with which certain officers and Directors of the fund are affiliated.
The Board of Directors approved an amended agreement effective September 1,
2000. Additional breakpoints were added for net assets in excess of $21
billion, and annual rates were reduced for net assets in excess of $27 billion.
Beginning June 1, 2000, CRMC has voluntarily agreed to waive its management
fees in excess of those provided by the amended agreement. The Amended
Investment Advisory and Service Agreement provides for monthly fees, accrued
daily, based on the following rates and net asset levels:
<TABLE>
<CAPTION>
Net Asset Level (in billions)
Rate Up to In Excess of
<S> <C> <C>
.50 % $ 0 $ 1
.40 1 2
.37 2 3
.35 3 5
.33 5 8
.315 8 13
.30 13 21
.29 21 27
.285 27 34
.281 34 44
.278 44 55
.276 55
</TABLE>
DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution for Class A shares,
the fund may expend up to 0.25% of Class A daily net assets annually for any
activities primarily intended to result in sales of fund shares, provided the
categories of expenses for which reimbursement is made are approved in advance
by the fund's Board of Directors. Fund expenses under the Plan include payments
to dealers to compensate them for their selling and servicing efforts. Pursuant
to a Plan of Distribution for Class B shares, the fund may expend 1.00% of
Class B daily net assets annually to compensate dealers for their selling and
servicing efforts. During the year ended August 31, 2000, distribution expenses
under the Plan of Distribution for Class A were limited to $75,719,000. Had no
limitation been in effect, the fund would have paid $81,332,000 in distribution
expenses for Class A shares under the plan. Some or all of the unpaid amounts
may be paid by the fund in the future. During the year ended August 31, 2000,
distribution expenses under the Plan of Distribution for Class B were $798,000.
As of August 31, 2000, accrued and unpaid distribution expenses for Class A and
Class B shares were $18,798,000 and $298,000, respectively.
American Funds Distributors, Inc. (AFD), the principal underwriter of the
fund's shares, received $23,877,000(after allowances to dealers)during the year
ended August 31, 2000, as its portion of the sales charges paid by purchasers
of the fund's Class A shares. Such sales charges are not an expense of the fund
and, hence, are not reflected in the accompanying statement of operations.
TRANSFER AGENT FEE - The fee of $29,132,000 was incurred during the year ended
August 31, 2000 pursuant to an agreement with American Funds Service Company
(AFS), the transfer agent for the fund.
DEFERRED DIRECTORS' FEES - Directors who are unaffiliated with CRMC may elect
to defer part or all of the fees earned for services as members of the Board.
Amounts deferred are not funded and are general unsecured liabilities of the
fund. As of August 31, 2000, aggregate deferred amounts and earnings thereon
since the deferred compensation plan's adoption (1993) net of any payments to
Directors, were $970,000.
AFFILIATED DIRECTORS AND OFFICERS - CRMC is owned by The Capital Group
Companies, Inc. AFS and AFD are both wholly owned subsidiaries of CRMC.
Officers of the fund and certain Directors are or may be considered to be
affiliated with CRMC, AFS and AFD. No such persons received any remuneration
directly from the fund.
5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES
The fund made purchases and sales of investment securities, excluding
short-term securities, of $16,857,622,000 and $12,255,316,000, respectively,
during the year ended August 31, 2000.
Pursuant to the custodian agreement, the fund receives credits against its
custodian fee for imputed interest on certain balances with the custodian bank.
For the year ended August 31, 2000, the custodian fee of $1,033,000 included
$183,000 that was paid by these credits rather than in cash.
The fund reclassified $67,300,000 from undistributed net investment income and
$174,348,000 from undistributed net realized gains to additional paid-in
capital for the year ended August 31, 2000, as a result of permanent
differences between book and tax.
As of August 31, 2000, net assets consisted of the following:
<TABLE>
<CAPTION>
<S> <C>
Amount(000)
Capital paid in on shares of
beneficial interest $22,362,726
UNDISTRIBUTED net investment income 71,158
Accumulated net realized GAIN 4,455,394
Net unrealized APPRECIATION 14,205,355
Net assets $41,094,633
</TABLE>
Capital share transactions in the fund were as follows:
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31, 2000 YEAR ENDED AUGUST 31, 1999
Amount Shares Amount Shares
(000) (000)
<S> <C> <C> <C> <C>
CLASS A
SHARES:
Sold $11,779,150 375,822,583 $4,179,298 174,121,917
Reinvestment 2,584,000 95,682,395 1,460,168 66,551,910
of dividends
and
distributions
Repurchased (3,984,053) (127,934,299) (2,550,833) (109,023,256)
Net increase 10,379,097 343,570,679 3,088,633 131,650,571
in Class A
CLASS B*
SHARES:
Sold 401,321 11,944,670 - -
Reinvestment - - - -
of dividends
and
distributions
Repurchased (3,531) (104,310) - -
Net increase 397,790 11,840,360 - -
in Class B
TOTAL NET $10,776,887 $355,411,039 $3,088,633 131,650,571
INCREASE IN
FUND
</TABLE>
PER-SHARE DATA AND RATIOS (1)
<TABLE>
<S> <C> <C> <C> <C>
Net
Net asset gains/(losses)
value, Net on securities Total from
beginning investment (both realized investment
Year ended(1) of year income and unrealized) operations
Class A:
2000 $26.20 0.18(2) 12.77(2) $12.95
1999 17.95 .07 10.48 10.55
1998 20.14 .10 (.10) .00
1997 15.39 .13 5.59 5.72
1996 16.55 .13 (.01) .12
Class B:
2000 32.44 - (2) 3.35(2) 3.35
Dividends
(from net Distributions Net asset
investment (from capital Total value, end
Year ended(1) income) gains) distributions of year
Class A:
2000 $(.04) $(3.20) $(3.24) $35.91
1999 (.09) (2.21) (2.30) 26.20
1998 (.13) (2.06) (2.19) 17.95
1997 (.11) (.86) (.97) 20.14
1996 (.14) (1.14) (1.28) 15.39
Class B:
2000 - - - 35.79
Ratio of Ratio of
Net assets, expenses net income
Total end of year to average to average
Year ended(1) return (in millions) net assets net assets
Class A:
2000 $53.51% $40,671 .70% .58%
1999 61.26 20,673 .70 .28
1998 (.24) 11,798 .70 .48
1997 38.54 11,646 .72 .73
1996 .90 8,511 .74 .82
Class B:
2000 10.33 424 1.45(3) - (3)
Portfolio
turnover
Year ended(1) rate
Class A:
2000 46.53%(4)
1999 45.61
1998 38.84
1997 34.10
1996 27.95
Class B:
2000 46.53(4)
(1) The periods 1996 through 2000 represent fiscal years ended August 31.
The period ended 2000 represents, for Class B shares, the 169-day
period ended August 31, 2000. Class B shares were not offered before
March 15, 2000. Total returns for Class B is based on activity
during the period and thus are not representative of a full year.
Total returns exclude all sales charges, including contingent
deferred sales charges.
(2) Based on average shares outstanding.
(3) Annualized.
(4) Represents portfolio turnover rate (equivalent for all share classes)
for the year ended August 31, 2000.
</TABLE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders of
The Growth Fund of America, Inc.:
We have audited the accompanying statement of assets and liabilities of The
Growth Fund of America, Inc., including the investment portfolio, as of August
31,2000,and the related statement of operations for the year then ended, the
statement of changes in net assets for each of the two years in the period then
ended, and the per-share data and ratios for each of the five years in the
period then ended for Class A shares, and the period March 15, 2000 through
August 31, 2000, for Class B shares. These financial statements and the
per-share data and ratios are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and the
per-share data and ratios based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements and per-share data and ratios are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures
included confirmation of securities owned at August 31, 2000 by correspondence
with the custodian and brokers; where replies were not received from brokers,
we performed other procedures. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and per-share data and ratios referred
to above present fairly, in all material respects, the financial position of
The Growth Fund of America, Inc. at August 31, 2000, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the per-share data and ratios for
each of the five years in the period then ended for Class A shares, and the
period March 15, 2000 through August 31, 200 for Class B shares, in conformity
with accounting principles generally accepted in the United States of America.
Deloitte & Touche LLP
Los Angeles, California
September 29, 2000
Tax Information (unaudited)
We are required to advise you within 60 days of the fund's fiscal year-end
regarding the federal tax status of distributions received by shareholders
during such fiscal year.
During the fiscal year ended August 31, 2000, the fund paid a long-term capital
gain distribution of $2,644,238,000. The fund also designated as a capital
gain distribution a portion of earnings and profits paid to shareholders in
redemption of their shares.
Corporate shareholders may exclude up to 70% of qualifying dividends received
during the year. For purposes of computing this exclusion, 100% of the
dividends paid by the fund from net investment income represents qualifying
dividends.
Dividends and distributions received by retirement plans such as IRAs,
Keogh-type plans, and 403(b) plans need not be reported as taxable income.
However, many plan retirement trusts may need this information for their annual
information reporting.
SINCE THE AMOUNTS ABOVE ARE REPORTED FOR THE FUND'S FISCAL YEAR AND NOT THE
CALENDAR YEAR, SHAREHOLDERS SHOULD REFER TO THEIR FORM 1099 DIV OR OTHER TAX
INFORMATION WHICH WILL BE MAILED IN JANUARY 2001 TO DETERMINE THE CALENDAR YEAR
AMOUNTS TO BE INCLUDED ON THEIR 2000 TAX RETURNS. SHAREHOLDERS SHOULD CONSULT
THEIR TAX ADVISERS.
BOARD OF DIRECTORS
GUILFORD C. BABCOCK
San Marino, California
Associate Professor of Finance,
Marshall School of Business,
University of Southern California
JAMES E. DRASDO
Los Angeles, California
President of the fund
Senior Vice President and Director,
Capital Research and
Management Company
ROBERT A. FOX
Livingston, California
President and Chief Executive Officer,
Foster Farms Inc.
ROBERTA L. HAZARD
McLean, Virginia
Consultant; Rear Admiral,
U.S. Navy (retired)
LEONADE D. JONES
Burlingame, California
Chief Financial Officer and Secretary,
VentureThink, LLC;
former Treasurer,
The Washington Post Company
JOHN G. MCDONALD
Stanford, California
The IBJ Professor of Finance,
Graduate School
of Business, Stanford University
GAIL L. NEALE
Burlington, Vermont
President,
The Lovejoy Consulting Group, Inc.;
former Executive Vice President
of the Salzburg Seminar
HENRY E. RIGGS
Claremont, California
President, Keck Graduate Institute
of Applied Life Sciences
JAMES F. ROTHENBERG
Los Angeles, California
Chairman of the Board of the fund
President and Director,
Capital Research
and Management Company
PATRICIA K. WOOLF, PH.D.
Princeton, New Jersey
Private investor; corporate director;
lecturer, Department of Molecular Biology,
Princeton University
OTHER OFFICERS
GORDON CRAWFORD
Los Angeles, California
Senior Vice President of the fund
Senior Vice President and Director,
Capital Research
and Management Company
PAUL G. HAAGA, JR.
Los Angeles, California
Senior Vice President of the fund
Executive Vice President and Director,
Capital Research
and Management Company
DONALD D. O'NEAL
San Francisco, California
Senior Vice President of the fund
Senior Vice President,
Capital Research
and Management Company
RICHARD M. BELESON
San Francisco, California
Vice President of the fund
Senior Vice President and Director,
Capital Research Company
MICHAEL T. KERR
Los Angeles, California
Vice President of the fund
Senior Vice President,
Capital Research Company
BRADLEY J. VOGT
Washington, D.C.
Vice President of the fund
Executive Vice President and Director,
Capital Research Company
JULIE F. WILLIAMS
Los Angeles, California
Secretary of the fund
Vice President - Fund Business
Management Group,
Capital Research
and Management Company
SHERYL F. JOHNSON
Norfolk, Virginia
Treasurer of the fund
Vice President - Fund Business
Management Group,
Capital Research
and Management Company
DAVID A. PRITCHETT
Norfolk, Virginia
Assistant Treasurer of the fund
Vice President - Fund Business
Management Group,
Capital Research
and Management Company
The American Funds Group(r)
OFFICE OF THE FUND
One Market
Steuart Tower, Suite 1800
Mailing address: P.O. Box 7650
San Francisco, California 94120-7650
INVESTMENT ADVISER
Capital Research
and Management Company
333 South Hope Street
Los Angeles, California 90071-1443
135 South State College Boulevard
Brea, California 92821-5823
TRANSFER AGENT FOR
SHAREHOLDER ACCOUNTS
American Funds Service Company
(Please write to the address nearest you.)
P.O. Box 2205
Brea, California 92822-2205
P.O. Box 659522
San Antonio, Texas 78265-9522
P.O. Box 6007
Indianapolis, Indiana 46206-6007
P.O. Box 2280
Norfolk, Virginia 23501-2280
CUSTODIAN OF ASSETS
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02105-1713
COUNSEL
Paul, Hastings, Janofsky & Walker LLP
555 South Flower Street
Los Angeles, California 90071-2371
INDEPENDENT AUDITORS
Deloitte & Touche LLP
Two California Plaza
350 South Grand Avenue
Los Angeles, California 90071-3462
PRINCIPAL UNDERWRITER
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, California 90071-1462
FOR INFORMATION ABOUT YOUR ACCOUNT OR ANY OF THE FUND'S SERVICES, OR FOR A
PROSPECTUS FOR ANY OF THE AMERICAN FUNDS, PLEASE CONTACT YOUR FINANCIAL
ADVISER. YOU MAY ALSO CALL AMERICAN FUNDS SERVICE COMPANY, TOLL FREE, AT
800/421-0180 OR VISIT WWW.AMERICANFUNDS.COM ON THE WORLD WIDE WEB. PLEASE READ
THE PROSPECTUS CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
THIS REPORT IS FOR THE INFORMATION OF SHAREHOLDERS OF THE GROWTH FUND OF
AMERICA, BUT IT MAY ALSO BE USED AS SALES LITERATURE WHEN PRECEDED OR
ACCOMPANIED BY THE CURRENT PROSPECTUS, WHICH GIVES DETAILS ABOUT CHARGES,
EXPENSES, INVESTMENT OBJECTIVES AND OPERATING POLICIES OF THE FUND. IF USED AS
SALES MATERIAL AFTER DECEMBER 31, 2000, THIS REPORT MUST BE ACCOMPANIED BY AN
AMERICAN FUNDS GROUP STATISTICAL UPDATE FOR THE MOST RECENTLY COMPLETED
CALENDAR QUARTER.
Printed on recycled paper
Litho in USA CDA/AL/4818
Lit. No. GFA-011-1000
