This is what American Growth Fund has done for its investors* over
the last 41 1/2 years.
*A conservative, long-term growth mutual fund with income as a
secondary objective.
**The figures in this brochure reflects the performance of the Funds
Class D shares. On 3/1/96, the Fund adopted a multi-class
distribution arrangement to issue additional classes of shares,
designated as Class A, Class B and Class C shares. Shares existing
prior to 3/1/96 became Class D shares. Class A and Class D shares are
subject to a maximum front-end sales charge of 5.75%, Class B shares
are subject to a maximum contingent deferred sales charge of 5% and
Class C shares are subject to a 1% contingent deferred sales charge
within the first year of purchase. The Fund may incur 12b-1 expenses
up to an annual maximum of .30 of 1% on its average daily net assets
of its Class A shares, 1% of its average daily net assets of its
Class B shares, and 1% of its average daily net assets of its Class
C shares. Class D shares have no 12b-1 fees. Performance figures for
Class D shares include the 5.75% initial sales charge and assume the
reinvestment of income dividends and capital gain distributions.
Performance quoted represents past performance. The investment return
and principal value of an investment will fluctuate so that the
investors shares, when redeemed, may be worth more or less than
their original cost. This material must be preceded or accompanied by
a current prospectus. If you have not received, or need a current
prospectus, please feel free to call for one. Please read the
prospectus carefully before investing.
Period ending 12/31/99.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Class D Class D1Class A Class A Class B Class B ClassC ClassC
without with without with without with withoutwith
load load load load load load load load
1 year 9.0% 2.8% 8.8% 2.5%2 8.1% 3.1%3 7.9% 6.9%4
5
years 12.7% 11.3%
10
years 10.9% 10.3%
15
years 11.2% 10.8%
41
years 10.8% 10.7%
Inception Date: 3/1/96 (not annualized)
37.8% 29.2%2 33.5% 29.5%5 36.8% 36.8%
</TABLE>
The performance figures on this table are as of 12/31/99.
1 Includes a 5.75% sales charge.
2 Includes a 5.75% initial sales charge at the time of purchase.
3 Includes a 5% contingent deferred sales charge at the time of
redemption.
4 Includes a 1% contingent defered sales charge at the time of
redemption.
5 Includes a 4% contingent deferred sales charge at the time of
redemption.
Distributor: American Growth Fund Sponsors, Inc. 110 Sixteenth Street,
Suite 1400, Denver, CO 80202. Phone (800) 525-2406.
3/2000
<PAGE>
Dear Shareholder:
Our portfolio in the last six months and the last year has been
positioned to take advantage of the stock market. Your portfolio has
substantially out performed the Dow Jones Industrials in both these
time periods. We try to include only the largest and most elite
companies in your portfolio in keeping with our investment philosophy
of maintaining conservative growth. Some of the companies that have
done best for you in the last six months are; Hewlett Packard, General
Electric, Amgen, Intel and Cisco.
We are excited about the years ahead and are optimistic that we will
continue to give you, our shareholder, rewarding performance. The
stock market has been a good one for American Growth Fund, Inc. over
the past 41 1/2 years and you have benefitted as a result.
My staff and I are always available to discuss your account with you,
so please give us a call toll free at 800-525-2406.
American Growth Fund wishes you A Good Future!
Sincerely
Robert Brody
<PAGE>
How American Growth Fund Has Its Shareowners Money Invested
STATEMENT OF INVESTMENTS
January 31, 2000
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
Market
Description of Security Shares Value
- ------------------------------------------------------------------
COMMON STOCKS 99.66%
Computer & Peripherals Industry 23.18%
Hewlett Packard Company. . . . . . . . . . 73,500 $ 7,956,375
(A designer and manufacturer of precision electronic products.)
Cisco Systems* . . . . . . . . . . . . . . 40,000 4,380,000
(The leading supplier of high-performance inter-networking
products.)
Compaq Computer. . . . . . . . . . . . . .159,648 4,370,364
(The second largest computer company in the world.)
EMC Corp.* . . . . . . . . . . . . . . . . 40,000 4,260,000
(Designs, manufactures, markets, and supports high performance
storage products for selected mainframe and open computing
systems.)
20,966,739
Semiconductor Industry 15.98%
Intel Corp.. . . . . . . . . . . . . . . . 60,000 5,936,250
(A leading manufacturer of integrated circuits.)
Motorola Inc. . . . . . . . . . . . . . . 35,000 4,786,250
(A leading manufacturer of electronic equipment and
components .)
Micron Technology* . . . . . . . . . . . . 60,000 3,731,250
(Manufactures and markets semiconductor components used in the
computer, telecommunications, and office automation industry .)
14,453,750
Household Products Industry 11.08%
Procter & Gamble Company . . . . . . . . . 50,000 5,043,750
(A leading consumer products company markets personal care and
household products.)
Colgate Palmolive Company. . . . . . . . . 84,000 4,977,000
(2nd largest domestic maker of detergents, toiletries and other
household products.)
10,020,750
*Non income producing security
See accompanying notes to financial statements
<PAGE>
Market
Description of Security Shares Value
- ------------------------------------------------------------------
Biotechnology Industry 11.05%
Amgen Inc.* . . . . . . . . . . . . . . 96,000 $ 6,114,000
(Utilizes biotechnology to develop human pharmaceutical products.)
Biogen Inc.* . . . . . . . . . . . . . . . 45,000 3,881,250
(A leading biotechnology company.)
9,995,250
Electronic Equipment Industry 8.85%
General Electric Company . . . . . . . . . 60,000 8,002,500
(One of the largest and most diversified industrial companies in
the world.)
Aluminum Industry 6.16%
Alcoa . . . . . . . . . . . . . . . . . . 80,000 5,575,000
(The world's largest aluminum producer.)
Auto Industry 4.89%
General Motors Corporation . . . . . . . . 55,000 4,424,063
(The world's largest auto manufacturer.)
Telecommunications Service Industry 4.08%
AT&T. . . . . . . . . . . . . . . . . . . 70,000 3,692,500
(Operates in the global telecommunications and information
management industry.)
Internet Industry 3.46%
America Online*. . . . . . . . . . . . . . 55,000 3,131,563
(The leading provider of online information services.)
*Non income producing security
See accompanying notes to financial statements
<PAGE>
Market
Description of Security Shares Value
- ------------------------------------------------------------------
Financial Services Industry 2.86%
Citigroup Inc. . . . . . . . . . . . . . 45,000 $ 2,584,687
(A diversified financial services company.)
Insurance Industry 2.70%
AXA Financial, Inc. . . . . . . . . . . . 75,000 2,442,187
(The parent holding company of the Equitable Life Assurance
Society of the U.S..)
Computer Software and Services Industry 2.21%
Oracle Corp.* . . . . . . . . . . . . . . 40,000 1,998,125
(The world's largest maker of database management systems.)
Precision Instrument Industry 2.06%
Eastman Kodak, Co. . . . . . . . . . . . . 30,000 1,856,250
(The world's largest producer of photographic products.)
Building Materials Industry 1.10%
Ameron International Corporation . . . . . 25,500 994,500
(The largest supplier of high-performance marine and offshore
coatings in the U.S.)
Total Common Stocks (cost $71,165,141) (99.66%). . . . .90,137,864
Total Investments, at Value
(cost $71,165,141) 99.66% 90,137,864
Cash and Receivables, Less Liabilities . . 0.34% 304,630
Net Assets . . . . . . . . . . . . . . . .100.00% $ 90,442,494
*Non income producing security
See accompanying notes to financial statements
</TABLE>
<PAGE>
Financial Statements
AMERICAN GROWTH FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES, JANUARY 31, 2000
(Unaudited)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments, at value (cost $71,165,141)-see accompanying
statement . . . . . . $ 90,137,864
Cash. . . . . . . . . . . . . . . . . . . . . . . 479,094
Receivables:
Shares of beneficial interest sold. . . . . . . . 62,115
Dividends. . . . . . . . 72,009
Total assets. . . . . . . . . . . . . . . . . . . 90,751,082
LIABILITIES:
Shares of beneficial interest redeemed. . . . . . 308,588
NET ASSETS . . . . . . . . . . . . . . . . . . . . $ 90,442,494
COMPOSITION OF NET ASSETS:
Paid-in capital . . . . . . . . . . . . . . . . . $ 66,611,906
Over distributed net investment income. . . . . . (1,026,738)
Accumulated net realized gain from investment
transactions. . . . . . . . 5,884,603
Net unrealized appreciation of investments. . . . 18,972,723
Net assets. . . . . . . . . . . . . . . . . . . . $ 90,442,494
NET ASSET VALUE PER SHARE:
Class A Shares:
Net asset value and redemption price per share
(based on net assets of $6,685,544 and 699,373
shares of beneficial interest outstanding) . . . . . $ 9.56
Maximum offering price per share (net asset
value plus sales charge of 5.75% of offering
price) . . . . . . . . $ 10.14
Class B Shares:
Net asset value, redemption price and offering
price per share (based on net assets of
$8,983,032 and 956,288 shares of beneficial
interest outstanding) . . . . . . $ 9.39
Class C Shares:
Net asset value, redemption price and offering
price per share (based on net assets of
$2,518,168 and 268,528 shares of beneficial
interest outstanding) . . . . . . $ 9.38
Class D Shares:
Net asset value and redemption price per share
(based on net assets of $72,255,750 and
7,518,601 shares of beneficial interest
outstanding) . . . . . $ 9.61
Maximum offering price per share (net asset
value plus sales charge of 5.75% of offering
price) . . . . . . . . $ 10.20
See accompanying notes to financial statements.
</TABLE>
<PAGE>
Financial Statements
AMERICAN GROWTH FUND, INC.
STATEMENT OF OPERATIONS FOR THE 6 MONTHS ENDED JANUARY 31, 2000
(Unaudited)
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT INCOME:
Interest . . . . . $ 573,542
Dividends (net of $3,407 foreign withholding
tax). . . . . . . . 114,461
Total investment income . . . . . . . . . . . . 688,003
EXPENSES:
Investment advisory fees (Note 5). . . . . . . 398,004
Administration expenses (Note 5) . . . . . . . 226,392
Transfer agent, shareholder servicing and data
processing fees . . . . . . 102,447
Custodian fees (Note 4). . . . . . . . . 60,426
Professional fees. . . . . . . 27,071
Registration and filing fees:
Class A . . . . . . . . . 3,885
Class B . . . . . . . . . 5,178
Class C . . . . . . . . . 1,480
Class D . . . . . . . . . 36,383
Shareholder reports. . . . . . . . . . . 17,752
Distribution and service fees:
Class A . . . . . . . . . 9,640
Class B . . . . . . . . . 52,206
Class C . . . . . . . . . 14,446
Directors fees . . . . . . . . 2,800
Other expenses . . . . . . . . 32,568
Total expenses. . . . . . . . . . . . . . . . . 990,678
Less expenses paid indirectly (Note 4) . . . . (17,654)
Net expenses. . . . . . . . . . . . . . . . . . 973,024
Net Investment Loss. . . . . . . . . . . . . . . (285,021)
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments . . . . . . . . 7,572,872
Net change in unrealized depreciation on
investments . . . . . . (1,683,201)
Net realized and unrealized gain . . . . . . . . 5,889,671
Net Increase in Net Assets Resulting From
Operations . . . . . . $ 5,604,650
See accompanying notes to financial statements.
</TABLE>
<PAGE>
Financial Statements
AMERICAN GROWTH FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
Six Months Ended Year Ended
January 31, 2000 July 31, 1999
(Unaudited)
OPERATIONS:
Net investment loss . . . . . . . . . $ (285,021) $ (57,538)
Net realized gain . . . . . . . . . . 7,572,872 7,359,974
Net change in unrealized appreciation
or depreciation . . . . . (1,683,201) (4,734,232)
Net increase in net assets resulting
from operations. . . . . . 5,604,650 2,568,204
DIVIDENDS AND DISTRIBUTIONS
TO SHAREHOLDERS:
Dividends from net investment income:
Class A . . . . . . . . . . . . . . . - (56,534)
Class B . . . . . . . . . . . . . . . - (8,505)
Class C . . . . . . . . . . . . . . . - (5,179)
Class D . . . . . . . . . . . . . . . - (474,946)
Book return of capital:
Class A . . . . . . . . . . . . . . . - (48,726)
Class B . . . . . . . . . . . . . . . - (7,296)
Class C . . . . . . . . . . . . . . . - (4,441)
Class D . . . . . . . . . . . . . . . - (409,627)
Distributions from net realized gain:
Class A . . . . . . . . . . . . . . . (427,882) -
Class B . . . . . . . . . . . . . . . (594,134) -
Class C . . . . . . . . . . . . . . . (160,199) -
Class D . . . . . . . . . . . . . . . (4,352,059) -
BENEFICIAL INTEREST TRANSACTIONS:
Net decrease in net assets resulting
from beneficial
interest transactions(Note 2):
Class A . . . . . . . . . . . . . . . (1,988,523) (5,837,113)
Class B . . . . . . . . . . . . . . . (2,307,237) (4,497,280)
Class C . . . . . . . . . . . . . . . (601,217) (1,423,013)
Class D . . . . . . . . . . . . . . . (1,872,998) (16,293,908)
NET ASSETS:
Total decrease. . . . . . . . . . . . (6,699,599) (26,498,364)
Beginning of period . . . . . . . . . 97,142,093 123,640,457
End of period . . . . . . . . . . . . $ 90,442,494 $ 97,142,093
See notes to financial statements.
</TABLE>
<PAGE>
Financial Highlights
Class A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Six Months Ended Year Ended July 31,
January 31, 2000
(Unaudited)
2000 1999 1998 1997 19966
Per Share Operating Data:
Net Asset Value,
Beginning of Period. . . $9.57 $9.49 $11.30 $8.84 $9.21
Income (loss) from
investment operations
Net investment income. . (0.07) (0.05) 0.044 0.144 -4
Net realized and
unrealized gain (loss). 0.66 0.21 (0.90) 2.83 (0.37)
Total income (loss) from
investment operations . 0.59 0.16 (0.86) 2.97 (0.37)
Dividends and distributions
to shareholders:
Dividends from net
investment income . . . - (0.04) (0.06)5(0.12)5 -
Book return of capital . - (0.04) - - -
Distributions from net
realized gain . . . . . (0.60) - (0.89) (0.39) -
Total dividends and
distributions
to shareholders. . . . .(0.60) (0.08) (0.95) (0.51) -
Net Asset Value, End of
Period . . . . . . . $9.56 $9.57 $9.49 $11.30 $8.84
Total Return at Net
Asset Value1 . . . . (2.7)% 2.0% (7.6)% 34.6% (4.0)%
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) . . . . $6,686 $8,635 $14,246$10,536 $3,838
Ratio to average net
assets:
Net investment income
(loss) . . . . . (0.67)% 0.00% 0.42% 1.28% 0.13%
Expenses2. . . . . . . . 2.22% 1.98% 1.77% 1.76% 2.06%
Portfolio Turnover
Rate3 . . . . . . . 99.5% 109.3% 103.5% 106.2% 163.1%
</TABLE>
1. Assumes a hypothetical initial investment on the business day
before the first day of the fiscal period with all dividends
and distributions reinvested in additional shares on the
reinvestment date and redemption at the net asset value
calculated on the last business day of the fiscal period. Sales
charges are not reflected in total returns. Total returns are
not annualized for periods of less than one full year.
2. Beginning in fiscal 1996, the expense ratio reflects the effect
of expenses paid indirectly by the Fund.
3. The lesser of purchases and sales of portfolio securities for a
period, divided by the monthly average of the market value of
securities owned during the period. Securities with a maturity
or expiration date at the time of acquisition of one year or
less are excluded from the calculation. Purchases and sales of
investment securities (other than short-term securities) for
the period ended January 31, 2000, aggregated $44,426,969 and
$45,443,948, respectively.
4. Net investment income (loss) per share is based upon relative
daily net asset values.
5. Distributions from net investment income per share are based
upon relative net asset values as of the business day following
the distribution record date.
6. For the period from March 1, 1996 (inception of offering) to
July 31, 1996.
See accompanying notes to financial statements.
<PAGE>
Financial Highlights
Class B
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Six Months Ended Year Ended July 31,
January 31, 2000
(Unaudited)
2000 1999 1998 1997 19966
Per Share Operating Data:
Net Asset Value,
Beginning of Period. . . $9.45 $9.37 $11.19 $8.80 $9.21
Income (loss) from
investment operations:
Net investment income
(loss) . . . . . (0.12) (0.13) (0.02)4 0.074 (0.01)4
Net realized and
unrealized gain
(loss). . . . . . 0.66 0.22 (0.90) 2.79 (0.40)
Total income (loss) from
investment operations.. 0.54 0.09 (0.92) 2.86 (0.41)
Dividends and distributions
to shareholders:
Dividends from net
investment income . . . - (0.01) (0.01)5 (0.09)5 -
Book return of capital . - -7 - - -
Distributions from net
realized gain . . . . (0.60) - (0.89) (0.39) -
Total dividends and distributions
to shareholders. . . . . (0.60) (0.01) (0.90) (0.48) -
Net Asset Value, End
of Period . . . . . . $9.39 $9.45 $9.37 $11.18 $8.80
Total Return at Net
Asset Value1 . . . . (3.5)% 0.9% (8.2)% 33.5% (4.5)%
Ratios/Supplemental Data:
Net assets, end of
period (in thousands) $8,983 $11,265 $15,533 $10,962 $3,417
Ratio to average net
assets:
Net investment income
(loss) . . . . . (1.46)% (0.01)% (0.32)% 0.49% (0.52)%
Expenses2. . . . . . 3.00% 2.73% 2.52% 2.46% 2.81%
Portfolio Turnover
Rate3 . . . . . . . 99.5% 109.3% 103.5% 106.2% 163.1%
</TABLE>
1. Assumes a hypothetical initial investment on the business day
before the first day of the fiscal period with all dividends and
distributions reinvested in additional shares on the reinvestment
date and redemption at the net asset value calculated on the last
business day of the fiscal period. Sales charges are not
reflected in total returns. Total returns are not annualized for
periods of less than one full year.
2. Beginning in fiscal 1996, the expense ratio reflects the effect
of expenses paid indirectly by the Fund.
3. The lesser of purchases and sales of portfolio securities for a
period, divided by the monthly average of the market value of
securities owned during the period. Securities with a maturity or
expiration date at the time of acquisition of one year or less
are excluded from the calculation. Purchases and sales of
investment securities (other than short-term securities) for the
period ended January 31, 2000, aggregated $44,426,969 and
$45,443,948, respectively.
4. Net investment income (loss) per share is based upon relative
daily net asset values.
5. Distributions from net investment income per share are based
upon relative net asset values as of the business day following
the distribution record date.
6. For the period from March 1, 1996 (inception of offering) to
July 31, 1996.
7. Less than $0.005 per share.
See accompanying notes to financial statements.
<PAGE>
Financial Highlights
Class C
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Six Months Ended Year Ended July 31,
January 31, 2000
(Unaudited)
2000 1999 1998 1997 19966
Per Share Operating Data:
Net Asset Value,
Beginning of Period. . . $9.44 $9.37 $11.19 $8.81 $9.21
Income (loss) from
investment operations:
Net investment income
(loss) . . . . . (0.12) (0.14) (0.02)4 0.074 -4
Net realized and
unrealized gain
(loss). . . . .. 0.66 0.23 (0.90) 2.79 (0.40)
Total income (loss) from
investment operations.. 0.54 0.09 (0.92) 2.86 (0.40)
Dividends and distributions
to shareholders:
Dividends from net
investment income . . . - (0.01) (0.01)5 (0.09)5 -
Book return of capital . - (0.01) - - -
Distributions from net
realized gain . . . . (0.60) - (0.89) (0.39) -
Total dividends and
distributions
to shareholders. . (0.60) (0.02) (0.90) (0.48) -
Net Asset Value,
End of Period . . . . .$9.38 $9.44 $9.37 $11.19 $8.81
Total Return at Net
Asset Value1 . . . . . (3.4)% 0.9% (8.2)% 33.6% (4.3)%
Ratios/Supplemental Data:
Net assets, end of
period (in thousands) .$2,518 $3,131 $4,498 $3,023 $367
Ratio to average net
assets:
Net investment income
(loss) . . . . . (1.46)% (0.01)% (0.31)% 0.55% (0.63)%
Expenses2. . . . . . . . 2.99% 2.75% 2.52% 2.50% 2.97%
Portfolio Turnover
Rate3 . . . . . . . 99.5% 109.3% 103.5% 106.2% 163.1%
</TABLE>
1. Assumes a hypothetical initial investment on the business day
before the first day of the fiscal period with all dividends and
distributions reinvested in additional shares on the reinvestment
date and redemption at the net asset value calculated on the last
business day of the fiscal period. Sales charges are not
reflected in total returns. Total returns are not annualized for
periods of less than one full year.
2. Beginning in fiscal 1996, the expense ratio reflects the effect
of expenses paid indirectly by the Fund.
3. The lesser of purchases and sales of portfolio securities for a
period, divided by the monthly average of the market value of
securities owned during the period. Securities with a maturity
or expiration date at the time of acquisition of one year or less
are excluded from the calculation. Purchases and sales of
investment securities (other than short-term securities) for the
period ended January 31, 2000, aggregated $44,426,969 and
$45,443,948, respectively.
4. Net investment income (loss) per share is based upon relative
daily net asset values.
5. Distributions from net investment income per share are based upon
relative net asset values as of the business day following the
distribution record date.
6. For the period from March 1, 1996 (inception of offering) to
July 31, 1996.
See accompanying notes to financial statements.Financial Highlights
<PAGE>
Financial Highlights
Class D
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Six Months Ended Year Ended July 31,
January 31, 2000
(Unaudited)
2000 1999 1998 1997 1996 1995
Per Share Operating Data:
Net Asset Value,
Beginning of Period
$9.61 $9.53 $11.33 $8.85 $8.75 $9.34
Income (loss) from investment operations:
Net investment income (loss)
(0.02) 0.01 0.074 0.174 0.034 0.21
Net realized and unrealized gain (loss)
0.62 0.17 (0.90) 2.82 0.39 0.88
Total income (loss) from investment operations
0.60 0.18 (0.83) 2.99 0.42 1.09
Dividends and distributions to shareholders:
Dividends from net investment income
- (0.05) (0.08)5(0.12)5 (0.12)5 (0.12)5
Book return of capital
- (0.05) - - - -
Distributions from net realized gain
(0.60) - (0.89) (0.39) (0.20) (1.56)
Total dividends and distributions to shareholders
(0.60) (0.10) (0.97) (0.51) (0.32) (1.68)
Net Asset Value, End of Period
$9.61 $9.61 $9.53 $11.33 $8.85 $8.75
Total Return at Net Asset Value1
(2.9)% 1.9% (7.4)% 35.1% 4.8% 15.2%
Ratios/Supplemental Data:
Net assets, end of period (in thousands)
$72,256 $74,111 $89,364$115,106$100,130$90,538
Ratio to average net assets:
Net investment income (loss)
(0.45)% 0.14% 0.63% 1.71% 0.47% 1.91%
Expenses2 1.95% 1.72% 1.54% 1.55% 1.63% 1.45%
Portfolio Turnover Rate3
99.5% 109.3% 103.5% 106.2% 163.1% 173.0%
</TABLE>
1. Assumes a hypothetical initial investment on the business day
before the first day of the fiscal period with all dividends
and distributions reinvested in additional shares on the
reinvestment date and redemption at the net asset value
calculated on the last business day of the fiscal period.
Sales charges are not reflected in total returns. Total returns
are not annualized for periods of less than one full year.
2. Beginning in fiscal 1996, the expense ratio reflects the effect
of expenses paid indirectly by the Fund.
3. The lesser of purchases and sales of portfolio securities for a
period, divided by the monthly average of the market value of
securities owned during the period. Securities with a maturity
or expiration date at the time of acquisition of one year or
less are excluded from the calculation. Purchases and sales of
investment securities (other than short-term securities) for
the period ended January 31, 2000, aggregated $44,426,969 and
$45,443,948, respectively.
4. Net investment income (loss) per share is based upon relative
daily net asset values.
5. Distributions from net investment income per share are based
upon relative net asset values as of the business day following
the distribution record date.
See accompanying notes to financial statements.
<PAGE>
Notes to Financial Statements
1. Summary of Significant Accounting Policies
American Growth Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended, as a diversified,
open-end management investment company. The Fund's primary
investment objective is to seek capital appreciation. The
Fund's investment advisor is Investment Research Corporation
(IRC). The Fund offers Class A, Class B, Class C and Class D
shares. Class D shares are available to shareholders in
existence prior to 3/1/96. Class A and Class D shares are sold
with a front-end sales charge. Class B and Class C shares may
be subject to a contingent deferred sales charge. All classes
of shares have identical rights to earnings, assets and voting
privileges, except that each class has its own distribution
and/or service plan and expenses directly attributable to that
class and exclusive voting rights with respect to matters
affecting that class. Class B shares will automatically
convert to Class A shares seven years after date of purchase.
The following is a summary of significant accounting policies
consistently followed by the Fund.
Investment Valuation - Investment securities are valued at the
closing asked price as reported by the principal securities
exchange on which the security is traded. If no sale is
reported, or if the security is not traded on an exchange,
value is based on the average of the latest bid and asked
prices. Short-term debt securities having a remaining maturity
of 60 days or less are valued at amortized cost, which
approximates market value.
Allocation of Income, Expenses, Gains and Losses - Income,
expenses (other than those attributable to a specific class),
gains and losses are allocated daily to each class of shares
based upon the relative proportion of net assets represented
by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that
class.
Federal Income Taxes - No provision for federal income or
excise taxes has been made because the Fund intends to comply
with provisions of the Internal Revenue Code applicable to
regulated investment companies and to distribute all of its
taxable income to shareholders.
Classification of Distributions to Shareholders - The
character of distributions made during the year from net
investment income or net realized gains may differ from its
ultimate characterization for federal income tax purposes.
Also, due to timing of dividend distributions, the fiscal year
in which amounts are distributed may differ from the fiscal
year in which the income or realized gain was recorded by the
Fund.
Other - Investment transactions are accounted for on the date
the investments are purchased or sold (trade date).
Dividend income and distributions to shareholders are recorded
on the ex-dividend date. Interest income is recorded on the
accrual basis. Realized gains and losses from investment
transactions and unrealized appreciation and depreciation of
investments are reported on an identified cost basis which is
the same basis used for federal income tax purposes.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of increases
and decreases in net assets from operations during the
reporting period. Actual results could differ from those
estimates.
<PAGE>
Notes to Financial Statements
2. Shares of Beneficial Interest - The Fund has authorized an
unlimited number of no par value shares of beneficial interest
of each class. Transactions in shares of beneficial interest
were as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Six Months Ended January 31, Year Ended July 31,
2000 (Unaudited) 1999
Shares Amount Shares Amount
Class A:
Sold
50,457 $496,559 253,536 $2,388,808
Dividends and
distributions reinvested
39,541 393,433 10,544 98,900
Redeemed
(292,687) (2,878,515) (863,218) (8,324,821)
Net decrease
(202,689) $(1,988,523) (599,138) $(5,837,113)
Class B:
Sold
19,041 $186,325 171,341 $1,617,151
Dividends and
distributions reinvested
55,896 547,222 1,577 14,680
Redeemed
(310,490) (3,040,784) (639,257) (6,129,111)
Net decrease
(235,553) $(2,307,237) (466,339) $(4,497,280)
Class C:
Sold
2,394 $23,475 72,340 $690,740
Dividends and
distributions reinvested
12,719 124,260 780 7,253
Redeemed
(78,389) (748,952) (221,264) (2,121,006)
Net decrease
(63,276) $(601,217) (148,144) $(1,423,013)
Class D:
Sold
102,739 $995,995 159,048 $1,506,344
Dividends and
distributions reinvested
418,490 4,184,893 85,582 805,335
Redeemed
(715,948) (7,053,886) (1,913,434) (18,605,587)
Net decrease
(194,719) $(1,872,998) (1,668,804) $(16,293,908)
</TABLE>
3. Unrealized Gains and Losses on Investments
The identified tax cost basis of investments at January 31,
2000 was $71,165,141. Net unrealized appreciation on
investments of $18,972,723, based on identified tax cost as
of January 31, 2000, was comprised of gross appreciation of
$22,319,233 and gross depreciation of $3,346,510.
4. Fund Expenses Paid Indirectly
For the year ended January 31, 2000, fees for custodian services
totaling $17,654 were offset by earnings on cash balances
maintained by the Fund at the custodian financial institution.
The Fund could have invested the assets maintained at the
institution in income-producing assets if it had not agreed to a
reduction in fees.
5. Underwriting, Investment Advisory Contracts and Service Fees
Under the investment advisory contract with Investment Research
Corporation ("IRC"), the advisor receives annual compensation
for investment advice, computed and paid monthly, equal to 1% of
the first $30 million of the Fund's average annual net assets
and 0.75%
<PAGE>
Notes to Financial Statements
of such assets in excess of $30 million. The Fund pays its own
operating expenses.
Class B and Class C shares are subject to annual service and
distribution fees of 0.25% and 0.75% of average daily net
assets, respectively. Class A shares are subject to annual
service and distribution fees of 0.25% and 0.05% of average
daily net assets, respectively.
For the six months ended January 31, 2000 commissions and sales
charges paid by investors on the purchase of Fund shares
totaled $42,596 of which $12,950 was retained by American
Growth Fund Sponsors, Inc. ("Sponsors"), an affiliated
broker/dealer which serves as the underwriter and distributor of
the Fund. Sales charges advanced to broker/dealers by Sponsors
on sales of the Fund's Class B and C shares totaled $4,263. For
the six months ended January 31, 2000, Sponsors received
contingent deferred sales charges of $30,072 upon redemption of
Class B and C shares, as reimbursement for sales commissions
advanced by Sponsors upon the sale of such shares.
The Fund paid $118,967 to Sponsors for brokerage commission on
securities transactions.
Certain officers of the Fund are also officers of Sponsors and
IRC. For the six months ended January 31, 2000 the Fund paid
directors' fees and expenses of $2,800.
For the six months ended January 31, 2000, under an agreement
with IRC, the Fund was charged $157,936 for the costs and
expenses related to employees of IRC who provided
administrative, clerical and accounting services to the Fund.
In addition, the Fund was charged $35,783 by an affiliated
company of IRC for the rental of office space.
6. Federal Income Tax Matters
On December 9, 1999, per share distributions from the capital
gains were declared as follows: Class A: $0.60, Class B: $0.60,
Class C: $0.60 and Class D: $0.60 respectively. The capital
gains were paid December 20, 1999. For the Fund's six months
ended January 31, 2000, all Capital Gains have been determined
to qualify for the dividend received deduction for corporate
shareholders.
TRANSFER AGENT: Boston Financial Data Services, Inc., Two Heritage
Drive, North Quincy, MA 02171
CUSTODIAN: State Street Bank & Trust Company, Two Heritage Drive,
North Quincy, MA 02171
RETIREMENT PLAN CUSTODIAN: State Street Bank & Trust Company, Two
Heritage Drive, North Quincy, MA 02171
INDEPENDENT AUDITORS: KPMG LLP, 707 Seventeenth Street, Suite 2300,
Denver, CO 80202
UNDERWRITER/DISTRIBUTOR: American Growth Fund Sponsors, Inc., 110
Sixteenth Street, Suite 1400, Denver, CO 80202
AMERICAN GROWTH FUND, INC. BOARD OF ADVISOR:
William D. Farr
President and Director of Farr Farms Co.
Chairman of the Board of Northern Colorado Water Conservancy
Past President of the National Cattleman's Association
Board Member of the Greeley Water Board
OFFICERS AND DIRECTORS
Robert Brody President and Director
Timothy E. Taggart Treasurer
D. Leann Baird Secretary
Michael J. Baum Director
Eddie R. Bush Director
Harold Rosen Director
INVESTMENT ADVISOR
Investment Research Corporation
110 Sixteenth Street, Suite 1400
Denver, CO 80202
OFFICERS AND DIRECTORS
Robert Brody President, Treasurer, and Director
Timothy E. Taggart Executive Vice President and Director
D. Leann Baird Secretary and Director
<PAGE>
