<PAGE>
[PIONEER LOGO]
Pioneer
Mid-Cap
Fund*
SEMIANNUAL REPORT
MARCH 31, 1996
*Changed from Pioneer Three effective February 1, 1996
<PAGE>
Dear Fellow Shareowner,
Pioneer Mid-Cap Fund completed the first half of its 14th fiscal year on
March 31, 1996. The period was one filled with changes for your Fund. Now
named Pioneer Mid-Cap Fund, your Fund has a new objective of long-term growth
by investing in companies with market capitalizations ranging between $100
million and $5 billion. The updated objective, which became effective on
February 1, is a shift from the former focus on growth and income from small
company stocks. The change gives your management greater investment
flexibility; it does not, however, affect our investment philosophy, which
remains focused on finding individual companies we expect can deliver solid
long-term performance.
Your Fund's Performance
Performance in the stock market remained strong during the period, continuing
the trend begun early in 1995. Despite the gains, however, some setbacks
occurred, especially early in 1996 when economic data triggered fears of
inflation and sent long-term interest rates higher. The stock market reacted
with increased volatility, including interim price declines.
For the six months ended March 31, 1996, we report the following results for
Pioneer Mid-Cap Fund Class A shares:
(bullet) Shareowners received a dividend of $0.1191 per share, and a capital
gains distribution of $1.7098 per share, both paid in December.
(bullet) Net asset value per share stood at $20.22 on March 31, versus
$21.48 on September 30, 1995, reflecting the payment of the
distributions.
(bullet) The Fund's six-month total return was 3.07% based on net asset
value and -2.85% based on public offering price. Total return
reflects the change in share price and assumes the reinvestment of
distributions at net asset value. The accompanying table highlights
the Fund's longer-term results.
*******************************************************************************
Average Annual Total Returns
(As of March 31, 1996)
Net Asset Public Offering
Period Value Price*
- ------------------------ ------------ ---------------------
Life-of-Fund (11/19/82) 13.17% 12.67%
10 Years 10.43 9.77
5 Years 13.25 11.92
1 Year 16.62 9.94
*******************************************************************************
On February 1, 1996, Class B and Class C shares were introduced to the Fund.
Since then, they have achieved the following results:
(bullet) Class B shares -- Net asset value was $20.18 per share on March 31,
versus an opening net asset value of $19.28. Your Fund's total
return for the abbreviated period was 4.67% assuming shares were
held throughout the period. If shares were redeemed and the maximum
4.0% contingent deferred sales charge was deducted at the end of
the period, total return was 0.67%. Total return reflects the
change in share price and assumes the reinvestment of
distributions.
(bullet) Class C shares -- Net asset value was $20.18 per share on March 31,
versus an opening net asset value of $19.28. Your Fund's total
return for the abbreviated period was 4.67% assuming shares were
held throughout the period, and 3.67% if shares were redeemed and
the 1% contingent deferred sales charge was deducted at the end of
the period. Total return reflects the change in share price and
assumes the reinvestment of distributions.
A Strong -- and Volatile -- Stock Market
At the beginning of your Fund's semiannual period, the environment for stock
investing was favorable. The low inflation, slow economic growth and falling
interest rates that existed throughout 1995 continued
*Reflects deduction of the maximum 5.75% sales charge and assumes
reinvestment of all distributions at net asset value.
The Fund's objective changed to long-term capital growth on February 1,
1996. Past performance does not guarantee future results. Returns and share
prices fluctuate, and your shares, when redeemed, may be worth more or less
than their original cost.
<PAGE>
into 1996. In fact, the Federal Reserve (the Fed) cut short-term interest
rates on January 31, reflecting its belief the economy was moving too slowly
and needed stimulation.
Late in the period, however, better-than-expected employment reports
indicated the economy was picking up steam. While only one of many indicators
used to determine the economy's strength, the employment figures nonetheless
spooked financial markets and led to spurts of volatility. Adding to the
uncertainty were increasing commodities prices, concerns the Fed would raise
short-term interest rates and waning hopes of a final federal budget and
reduced government spending in an election year. Despite the heightened
volatility, the Dow Jones Industrial Average pushed ahead to post an
impressive gain of 18.01% for the semiannual period. The broader-based
Standard & Poor's 500 Index returned 11.68% over the same six months. And the
Standard & Poor's 400 Mid-Cap Index, which your management now uses as a
benchmark for the Fund's performance, returned 11.84%. The figures recorded
by the indices, while reflective of the stock market's continued strength,
masked the significant volatility many individual stocks -- and stock
investors -- encountered.
How Pioneer Managed Your Investment
During the period, your management began the process of repositioning the
Fund's portfolio. We sold a number of holdings that reflected the Fund's
previous income objective, but have only begun to reallocate these assets. We
intend for the Fund to be as fully invested as possible; however, we will not
add a company to the portfolio until we have thoroughly researched it. For
that reason, the portfolio's cash position was relatively high -- 12% -- as
of March 31. We expect this figure will come down as we continue to identify
mid-capitalization prospects.
In reviewing portfolio holdings, we evaluated securities to identify those we
expect to add value to the portfolio moving forward, and those that had
reached their full potential or don't fit the Fund's growth focus. Based on
our review, we eliminated several companies over the period, including some
within traditional income-oriented sectors, such as energy. For example, we
sold Southwestern Energy and Diamond Shamrock, companies that distributed a
significant part of their earnings as dividend income. Other holdings we sold
include: Farrel, Angelica, Pentair, Arvin Industries, Geon, Russ Berrie,
Cambrex, Zenith Electronics, and Huffy. While we consider most of these
companies to be solid, we plan to re-deploy the assets to enhance the Fund's
growth potential, choosing companies that reinvest earnings to expand their
business.
At March 31, Pioneer Mid-Cap Fund's portfolio held 115 stocks. The
accompanying chart shows the Fund's investments by industry at the end of the
period.
************************************[PIE CHART]********************************
Sector Distribution
(Percentage of equity investments as of March 31, 1996)
Capital Goods 18%
Consumer Non-Durables 15%
Services 15%
Financial 13%
Technology 11%
Other 8%
Consumer Durables 7%
Basic Industries 7%
Energy 6%
********************************************************************************
Looking Ahead
Debates will undoubtedly persist -- particularly in this election year -- as
to whether financial markets will move higher, or whether they will reverse
course. We believe no one can predict stock market movements into the future;
however, we think stock prices will likely remain somewhat volatile
near-term, especially given the uncertain strength of the economy. Your
management, however, does not get bogged down in market forecasting. Instead,
we remain focused on what we think is the most effective way to invest for
the long-term -- identifying the potential of individual companies.
2
<PAGE>
We want to once again thank you for approving the proposals for Pioneer
Mid-Cap Fund; your management is confident the changes to the Fund will lead
to even stronger long-term performance. As we move into 1996, we will
continue to adjust the portfolio and research mid-capitalization companies we
expect will offer long-term growth. We appreciate your patience during this
time of transition, and we hope you look forward, as we do, to building a
lasting investment.
The following pages provide the Fund's audited Schedule of Investments and
financial statements as of March 31, 1996. If you have any questions about
your investment in Pioneer Mid-Cap Fund, please contact your investment
representative, or call Pioneer at 1-800-225-6292. Thank you for your
continued support.
Respectfully,
/s/ John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman and President,
Pioneer Mid-Cap Fund
3
<PAGE>
SCHEDULE OF INVESTMENTS-PIONEER MID-CAP FUND-March 31, 1996
Shares Value
- ---------- -------------
COMMON STOCKS--87.6%
BASIC INDUSTRIES--5.9%
Chemicals--1.5%
607,700 Crompton & Knowles Corp. $ 8,887,613
231,850 The Dexter Corp. 6,144,025
-----------
$ 15,031,638
-----------
Forest Products--1.3%
299,135 Potlatch Corp. $ 12,788,021
-----------
Iron & Steel--2.5%
1,000,000 Armco, Inc.* $ 5,375,000
632,800 Chaparral Steel Co. 9,412,900
151,700 Harsco Corp. 10,050,125
92,500 Intermet Corp. 1,214,063
-----------
$ 26,052,088
-----------
Pollution & Waste--0.3%
325,000 Gundle Environmental Systems, Inc.* $ 1,807,813
58,300 Zurn Industries, Inc. 1,195,150
-----------
$ 3,002,963
-----------
Precious Metals--0.3%
464,700 Hecla Mining Co.* $ 3,543,338
-----------
Total Basic Industries $ 60,418,048
-----------
CAPITAL GOODS--15.8%
Construction & Engineering--3.5%
205,100 Granite Construction, Inc. $ 6,050,450
148,350 Hughes Supply, Inc. 4,246,519
467,975 Ply-Gem Industries, Inc. 6,844,134
792,187 RPM, Inc. 12,278,899
387,700 The Ryland Group, Inc. 6,251,663
-----------
$ 35,671,665
-----------
Producer Goods--12.3%
575,000 Castech Aluminum Group, Inc.* $ 8,265,625
212,650 CLARCOR, Inc. 4,625,138
445,000 DT Industries, Inc. 8,510,625
463,000 The Duriron Co., Inc. 12,732,500
483,480 Federal Signal Corp. 12,389,175
199,600 Ferrofluidics Corp.* 1,946,100
425,000 Greenfield Industries 14,715,625
396,400 Kennametal, Inc. 14,319,950
413,451 Keystone International, Inc. 9,302,648
277,800 Kimball International, Inc. (Class B) 7,917,300
763,000 Regal-Beloit Corp. 16,023,000
465,800 Shelby Williams Industries, Inc.+ 5,007,350
527,400 Watts Industries, Inc. (Class A) 10,482,075
-----------
$126,237,111
-----------
Total Capital Goods $161,908,776
-----------
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
Shares Value
- ---------- -------------
CONSUMER DURABLES--6.1%
Consumer Durables--1.3%
301,000 Leggett & Platt, Inc. $ 6,885,375
338,900 Wabash National Corp. 6,396,738
-----------
$ 13,282,113
-----------
Motor Vehicles--4.8%
323,000 Gentex Corp.* $ 9,609,250
512,000 Hi-Lo Automotive, Inc.* 2,752,000
252,800 Modine Manufacturing Co. 6,699,200
707,012 Simpson Industries, Inc. 6,628,242
313,400 Standard Motor Products, Inc. 5,014,400
450,000 Stewart & Stevenson Services, Inc. 12,656,250
800,000 TBC Corp.* 5,800,000
-----------
$ 49,159,342
-----------
Total Consumer Durables $ 62,441,455
-----------
CONSUMER NON-DURABLES--12.8%
Agriculture & Food--0.2%
137,200 Thorn Apple Valley, Inc. $ 1,646,400
-----------
Consumer Luxuries--1.8%
240,800 Outboard Marine Corp. $ 4,605,300
241,900 Polaris Industries, Inc. 7,438,425
381,600 Toy Biz, Inc. (Class A)* 6,821,100
-----------
$ 18,864,825
-----------
Retail Food--0.1%
112,700 Ruddick Corp. $ 1,380,575
-----------
Retail Non-Food--6.6%
354,000 Arbor Drugs, Inc. $ 7,434,000
390,000 Catherines Stores Corp.+* 3,900,000
734,900 CML Group, Inc. 2,296,563
742,300 Consolidated Stores Corp.* 24,867,050
119,700 Designs, Inc.* 837,900
513,000 Family Dollar Stores, Inc. 7,566,750
143,100 Fingerhut Companies, Inc. 1,842,413
115,000 Fred Meyer, Inc.* 3,220,000
425,000 MicroAge, Inc.* 4,409,375
50,000 Office Depot, Inc.* 981,250
826,464 Pier 1 Imports, Inc. 10,434,108
-----------
$ 67,789,409
-----------
Textiles/Clothes--4.1%
450,000 Cone Mills Corp.* $ 5,231,250
377,100 Crown Crafts, Inc. 3,582,450
175,400 Cutter & Buck, Inc.* 1,754,000
448,400 Guilford Mills, Inc. 10,985,800
550,000 Paragon Trade Brands, Inc.* 11,412,500
368,212 Unifi, Inc. 9,067,221
-----------
$ 42,033,221
-----------
Total Consumer Non-Durables $131,714,430
-----------
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
Shares Value
- ---------- -------------
ENERGY--5.0%
Oil Services--3.4%
788,300 Oceaneering International, Inc.* $ 10,740,588
615,400 Stolt Comex Seaway S.A.* 7,077,100
471,763 Weatherford Enterra, Inc.* 16,452,735
-----------
$ 34,270,423
-----------
Oil & Gas Extraction--1.6%
293,018 Anderson Exploration Ltd.* $ 3,195,486
239,600 Plains Resources, Inc.* 2,171,375
102,400 Seagull Energy Corp.* 2,316,800
366,900 Vintage Petroleum, Inc. 7,475,588
259,600 Wainoco Oil Corp.* 811,250
-----------
$ 15,970,499
-----------
Total Energy $ 50,240,922
-----------
FINANCIAL--11.7%
Commercial Bank--4.0%
342,500 Magna Group, Inc. $ 7,920,313
309,200 Meridian Bancorp, Inc. 16,155,700
425,801 Old Kent Financial Corp. 16,978,815
-----------
$ 41,054,828
-----------
Insurance-General--2.3%
450,000 American Bankers Insurance Group, Inc. $ 15,862,500
463,200 Western National Corp. 7,527,000
-----------
$ 23,389,500
-----------
Non-Life Insurance--4.4%
759,200 Allmerica Property & Casualty Companies,
Inc. $ 19,929,000
413,500 Guaranty National Corp. 6,822,750
358,000 Selective Insurance Group, Inc. 12,888,000
413,712 Willis Corroon Group Plc (Sponsored A.D.R.) 5,119,686
-----------
$ 44,759,436
-----------
Savings & Loan--0.7%
245,000 ALBANK Financial Corp. $ 7,074,375
-----------
Misc--Financial--0.3%
236,400 DVI, Inc.* $ 2,925,450
-----------
Total Financial $119,203,589
-----------
SERVICES--13.5%
Health Services & Personal Care--9.8%
400,900 Allied Healthcare Products+ $ 5,311,925
421,100 American Healthcorp, Inc.+* 3,737,263
50,000 Apria Healthcare Group, Inc.* 1,587,500
558,560 Bergen Brunswig Corp. (Class A) 14,592,380
507,300 BioWhittaker, Inc.* 4,121,813
200,021 Boston Scientific Corp.* 9,200,966
600,000 Coastal Physician Group, Inc.* 5,325,000
384,199 Community Health Systems, Inc.* 15,752,159
540,195 Healthdyne Technologies, Inc.* 6,718,675
475,000 Integrated Health Services, Inc. 11,103,125
460,000 Lincare Holdings, Inc.* 14,950,000
575,000 Sun Healthcare Group, Inc.* 7,618,750
-----------
$100,019,556
-----------
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
Shares Value
- ---------- -------------
Pharmaceuticals--1.3%
3,200 Cardinal Health, Inc. $ 205,600
925,800 Medeva Plc (Sponsored A.D.R.) 13,655,550
-----------
$ 13,861,150
-----------
Publishing--0.5%
115,600 Houghton Mifflin Company $ 5,100,850
-----------
Miscellaneous--1.9%
471,200 Ideon Group, Inc. $ 5,242,100
292,400 The Interpublic Group of Companies, Inc. 13,815,900
-----------
$ 19,058,000
-----------
Total Services $138,039,556
-----------
TECHNOLOGY--9.8%
Business Machines--2.6%
900,000 Data General Corp.* $ 13,162,500
217,400 National Computer Systems, Inc. 4,402,350
300,000 Stratus Computer, Inc.* 8,325,000
-----------
$ 25,889,850
-----------
Computer Software--1.2%
450,000 BancTec, Inc.* $ 7,762,500
630,000 Banyan Systems, Inc.* 4,803,750
-----------
$ 12,566,250
-----------
Electronics--6.0%
606,015 Baldor Electric Co. $ 12,196,052
368,600 Belden, Inc. 10,873,700
437,000 Holophane Corp.* 7,866,000
117,500 Intergraph Corp.* 1,880,000
285,000 Kuhlman Corp. 4,275,000
75,000 LAM Research Corp.* 2,625,000
249,100 Marshall Industries* 7,597,550
690,000 Micro Focus Group Plc (Sponsored A.D.R.)* 7,417,500
302,100 Whittaker Corp.* 7,099,350
-----------
$ 61,830,152
-----------
Total Technology $100,286,252
-----------
TRANSPORTATION--3.0%
Air Transport--1.1%
444,600 Airborne Freight Corp. $ 11,226,150
-----------
Ships & Shipping--1.1%
507,900 American President Companies, Ltd. $ 11,681,700
-----------
Truck Transport & Storage--0.8%
900,000 Arkansas Best Corp. $ 7,875,000
-----------
Total Transportation $ 30,782,850
-----------
UTILITIES--4.0%
Gas Utility--2.7%
591,300 KN Energy, Inc. $ 18,404,213
274,300 Peoples Energy Corp. 8,880,463
-----------
$ 27,284,676
-----------
Utility/Other--1.3%
373,000 Eastern Enterprises $ 13,241,491
-----------
Total Utilities $ 40,526,167
-----------
TOTAL COMMON STOCKS (Cost $630,155,661) $895,562,045
-----------
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
<TABLE>
<CAPTION>
Principal
Amount Value
- ------------ --------------
TEMPORARY CASH INVESTMENTS--12.4%
Commerical Paper--12.4%
<S> <C> <C>
$14,738,000 American Express, 5.30%, 04/01/96 $ 14,738,000
11,809,000 Associates Corp., 5.30%, 04/12/96 11,809,000
16,217,000 Beneficial Corp., 5.40%, 04/09/96 16,217,000
18,593,000 Chevron Oil Finance, 5.40%, 04/10/96 18,593,000
12,564,000 Commercial Credit Corp., 5.38%, 04/04/96 12,564,000
18,569,000 Ford Motor Credit Co., 5.35%, 04/02/96 18,569,000
11,809,000 General Electric Capital Corp., 5.36%, 04/11/96 11,809,000
10,752,000 Norwest Financial Corp., 5.39%, 04/08/96 10,752,000
12,040,000 Prudential Corp., 5.39%, 04/03/96 12,040,000
------------
TOTAL TEMPORARY CASH INVESTMENTS (Cost $127,091,000) $ 127,091,000
------------
TOTAL INVESTMENT IN SECURITIES--100% (Cost $757,246,661)(a) $1,022,653,045
============
* Non-income producing security.
+ Investments held representing 5% or more of the outstanding voting stock of
such company (see Note 6).
(a) At March 31, 1996, the net unrealized gain on investments based on cost
for federal income tax purposes of $757,246,661 was as follows:
Aggregate gross unrealized gain for all investments in which there
is an excess of value over tax cost $331,673,388
Aggregate gross unrealized loss for all investments in which there
is an excess of tax cost over value (66,267,004)
-----------
Net unrealized gain $265,406,384
===========
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for
the six months ended March 31, 1996 aggregated approximately $91,325,000 and
$218,430,000, respectively.
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
BALANCE SHEET--MARCH 31, 1996
(Dollars in Thousands Except Net Asset Value Per Share Amounts)
ASSETS:
Investment in securities, at value
(including temporary cash investments of $127,091)
(cost $757,247; see Schedule of Investments
and Notes 1 and 6) $1,022,653
Receivables--
Investment securities sold 2,905
Fund shares sold 255
Dividends and Interest 1,123
Other 27
----------
Total assets $1,026,963
----------
LIABILITIES:
Payables--
Investment securities purchased $ 174
Fund shares repurchased 1,130
Due to affiliates (Notes 2, 3 and 4) 765
Accrued expenses 92
----------
Total liabilities $ 2,161
----------
NET ASSETS:
Paid-in capital (Note 1) $ 715,610
Accumulated undistributed net investment income 5,369
Accumulated undistributed net realized
gain on investments 38,417
Net unrealized gain on investments 265,406
----------
Total net assets $1,024,802
==========
NET ASSET VALUE PER SHARE:
Class A--(based on $1,024,479,806 / 50,663,277 shares
of beneficial interest outstanding--unlimited
number of shares authorized) $ 20.22
==========
Class B--(based on $195,226 / 9,674 shares of
beneficial interest outstanding--unlimited
number of shares authorized) $ 20.18
==========
Class C--(based on $126,865 / 6,286 shares of
beneficial interest outstanding--unlimited
number of shares authorized) $ 20.18
==========
MAXIMUM OFFERING PRICE:
Class A $ 21.45
==========
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
STATEMENT OF OPERATIONS
For the Six Months Ended March 31, 1996
(Dollars in Thousands)
Investment Income (Note 1):
Dividends (net of foreign taxes withheld of $54) $ 7,380
Interest 2,075
-------
Total investment income: $ 9,455
-------
Expenses:
Management fees (Note 2) $ 2,384
Transfer agent fees (Note 3)
Class A 922
Class B --
Class C --
Distribution fees (Note 4)
Class A 952
Class B --
Class C --
Registration fees 20
Custodian fees 50
Professional fees 116
Accounting (Note 2) 26
Printing 76
Fees and expenses of nonaffiliated trustees 11
Miscellaneous 30
-------
Total expenses $ 4,587
Less fees paid indirectly (Note 5) (58)
-------
Net expenses $ 4,529
-------
Net investment income $ 4,926
-------
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain on investments (Note 1) $ 51,094
Change in net unrealized gain on investments (26,289)
-------
Net gain on investments $ 24,805
-------
Net increase in net assets resulting from operations $ 29,731
=======
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
For the Six Months Ended March 31, 1996
and for the Year Ended September 30, 1995
(Dollars in Thousands Except Per Share Amounts)
Six Months
Ended Year Ended
March 31, Sept. 30,
1996 1995
---------- -----------
From Operations:
Net investment income $ 4,926 $ 12,011
Net realized gain on investments 51,094 76,657
Change in net unrealized
gain on investments (26,289) 66,524
-------- ---------
Net increase in net assets
resulting from operations $ 29,731 $ 155,192
-------- ---------
Distributions to Shareholders from:
Net investment income
Class A ($0.12 and $0.23 per share,
respectively) $ (5,877) $ (11,708)
Net realized gain
Class A ($1.71 and $1.15 per share,
respectively) (84,356) (57,659)
-------- ---------
Decrease in net assets resulting from
distributions to shareholders $ (90,233) $ (69,367)
-------- ---------
From FUND Share Transactions:
Net proceeds from sale of shares $ 20,642 $ 81,319
Net asset value of shares issued to
shareholders in reinvestment of dividends 86,358 66,582
Cost of shares repurchased (103,850) (168,805)
-------- ---------
Net increase (decrease) in net assets
resulting from fund share transactions $ 3,150 $ (20,904)
-------- ---------
Net increase (decrease) in net assets $ (57,352) $ 64,921
Net Assets:
Beginning of period $ 1,082,154 $1,017,233
-------- ---------
End of period (including accumulated
undistributed net investment income of
$5,369 and $6,320, respectively) $ 1,024,802 $1,082,154
======== =========
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
-------------------- -----------------------
Shares Amount Shares Amount
-------- ------ -------- ---------
CLASS A
Shares sold 1,011,667 $ 20,334 4,234,630 $ 81,319
Shares issued to
shareholders in
reinvestment of
distributions 4,484,498 86,358 3,754,378 66,582
Less shares
repurchased (5,223,707) (103,850) (8,669,270) (168,805)
-------- ------ -------- ---------
Net increase
(decrease) 272,458 $ 2,842 (680,262) $ (20,904)
======== ====== ======== =========
CLASS B*
Shares sold 9,674 $ 188
Shares issued to
shareholders in
reinvestment of
distributions -- --
Less shares
repurchased -- --
-------- ------
Net increase 9,674 $ 188
======== ======
CLASS C*
Shares sold 6,286 $ 120
Shares issued to
shareholders in
reinvestment of
distributions -- --
Less shares repurchased -- --
-------- ------
Net increase 6,286 $ 120
======== ======
*Class B and Class C shares were first publicly offered on February 1, 1996.
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
FINANCIAL HIGHLIGHTS
Selected Data For a Share Outstanding For The Periods Presented
<TABLE>
<CAPTION>
Six Months
Ended
March 31, For the Years Ended September 30,
------------------------------------------------------
CLASS A 1996 1995 1994 1993 1992 1991
---------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $21.48 $19.92 $21.12 $18.03 $16.16 $12.96
-------- ------ ------ ------ ------ ------
Increase (decrease) from investment
operations:
Net investment income $0.10 $0.24 $0.24 $0.28 $0.33 $0.41
Net realized and unrealized gain
(loss) on investments 0.47 2.70 0.32 3.72 2.04 3.94
-------- ------ ------ ------ ------ ------
Total increase (decrease) from
investment operations $0.57 $2.94 $0.56 $4.00 $2.37 $4.35
Distribution to shareholders from:
Net investment income (0.12) (0.23) (0.25) (0.29) (0.35) (0.41)
Net realized gain (1.71) (1.15) (1.51) (0.62) (0.15) (0.74)
-------- ------ ------ ------ ------ ------
Net increase (decrease) in net asset
value $(1.26) $1.56 $(1.20) $3.09 $1.87 $3.20
-------- ------ ------ ------ ------ ------
Net asset value, end of period $20.22 $21.48 $19.92 $21.12 $18.03 $16.16
======== ====== ====== ====== ====== ======
Total return* 3.07% 16.24% 2.62% 22.82% 15.05% 35.80%
Ratio of net expenses to average net
assets 0.89%+** 0.85%+ 0.86% 0.84% 0.85% 0.74%
Ratio of net investment income to
average net assets 0.95%+** 1.18%+ 1.19% 1.43% 1.85% 2.72%
Portfolio turnover rate 19%** 19% 15% 18% 12% 5%
Average commission rate paid+++ $0.0530 -- -- -- -- --
Net assets, end of period (in
thousands) $1,024,480 $1,082,154 $1,017,233 $1,019,059 $779,631 $692,344
Ratios assuming reduction for
fees paid indirectly:
Net expenses 0.88%** -- -- -- -- --
Net investment income 0.96%** -- -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
CLASS A For the Years Ended September 30,
---------------------------------------------------
<S> <C> <C> <C> <C> <C>
1990 1989 1988 1987 1986
-------- ----- ----- ----- -----
Net asset value, beginning of period $17.80 $15.09 $18.52 $16.01 $13.98
-------- ----- ----- ----- -----
Increase (decrease) from investment operations:
Net investment income $0.41 $0.42 $0.30 $0.28 $0.34
Net realized and unrealized gain (loss) on
investments (3.56) 3.33 (1.91) 3.76 2.41
-------- ----- ----- ----- -----
Total increase (decrease) from investment operations $(3.15) $3.75 $(1.61) $4.04 $2.75
Distribution to shareholders from:
Net investment income (0.46) (0.36) (0.41) (0.36) (0.36)
Net realized gain (1.23) (0.68) (1.41) (1.17) (0.36)
-------- ----- ----- ----- -----
Net increase (decrease) in net asset value $(4.84) $2.71 $(3.43) $2.51 $2.03
-------- ----- ----- ----- -----
Net asset value, end of period $12.96 $17.80 $15.09 $18.52 $16.01
======== ===== ===== ===== =====
Total return* (19.39)% 26.32% (6.00)% 27.50% 20.40%
Ratio of net expenses to average net assets 0.71% 0.72% 0.76% 0.68% 0.71%
Ratio of net investment income to average net assets 2.58% 2.56% 2.15% 1.74% 2.41%
Portfolio turnover rate 14% 16% 12% 23% 24%
Average commission rate paid+++ -- -- -- -- --
Net assets, end of period (in thousands) $562,343 $752,135 $616,953 $734,300 $543,173
Ratios assuming reduction for fees paid indirectly:
Net expenses -- -- -- -- --
Net investment income -- -- -- -- --
</TABLE>
+ Ratios assuming no reduction for fees paid indirectly.
+++ Amount represents the rate of commission paid per share on the Fund's
exchange listed security transactions.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
FINANCIAL HIGHLIGHTS
Selected Data For a Share Outstanding For The Periods Presented (Continued)
February 1, 1996
to
CLASS B*** March 31, 1996
----------------
Net asset value, beginning of period $19.28
---------------
Increase from investment operations:
Net investment income $ -
Net realized and unrealized gain on investments 0.90
---------------
Total increase from investment operations $0.90
---------------
Net increase in net asset value $0.90
---------------
Net asset value, end of period $20.18
===============
Total return* 4.67%
Ratio of net expenses to average net assets 2.26%** +
Ratio of net investment income to average net assets 0.14%**+
Portfolio turnover rate 19%**
Average commission rate paid+++ $0.0530
Net assets, end of period (in thousands) $195
Ratios assuming reduction for fees paid indirectly:
Net expenses 2.26%**
Net investment income 0.14%**
February 1, 1996
to
CLASS C*** March 31, 1996
----------------
Net asset value, beginning of period $19.28
---------------
Increase from investment operations:
Net investment income $ -
Net realized and unrealized gain on investments 0.90
---------------
Total increase from investment operations $0.90
---------------
Net increase in net asset value $0.90
---------------
Net asset value, end of period $20.18
===============
Total return* 4.67%
Ratio of net expenses to average net assets 2.45%**+
Ratio of net investment income to average net assets 0.03%**+
Portfolio turnover rate 19%**
Average commission rate paid+++ $0.0530
Net assets, end of period (in thousands) $127
Ratios assuming reduction for fees paid indirectly:
Net expenses 2.33%**
Net investment income 0.15%**
+ Ratios assuming no reduction for fees paid indirectly.
++ Amount represents the rate of commission paid per share on the Fund's
exchange listed security transactions.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
*** Class B and Class C shares were first publicly offered on February 1,
1996.
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
NOTES TO FINANCIAL STATEMENTS-March 31, 1966
1. Pioneer Mid-Cap Fund (the Fund) is a Delaware business trust registered
under the Investment Company Act of 1940 as a diversified, open-end
management investment company. Effective February 1, 1996, certain changes
were made to the Fund's operations including, among other things, a new
management contract and a change in the Fund's investment objective from
reasonable income and growth of capital to capital growth exclusively. In
connection with this policy change, the Fund changed its name from Pioneer
Three.
The Board of Trustees (the Trustees) has authorized the issuance of three
share classes of the Fund, designated as Class A, Class B and Class C shares.
Class B and C shares were first publicly offered on February 1, 1996. Shares
issued and outstanding prior to February 1, 1996 were designated as Class A
shares. The shares of Class A, Class B and Class C represent an interest in
the same portfolio of investments of the Fund and have equal rights to
voting, redemptions, dividends and liquidation, except that each class of
shares can bear different transfer agent and distribution fees and have
exclusive voting rights with respect to the distribution plans that have been
adopted by Class A, Class B and Class C shareholders, respectively.
The Fund's financial statements have been prepared in conformity with
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities at the date of the financial statements, and the
reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates. The following is a summary
of significant accounting policies consistently followed by the Fund, which
are in conformity with those generally accepted in the investment company
industry:
A. Security Valuation--Security transactions are recorded on trade date.
Each day, securities are valued at the last sale price on the principal
exchange where they are traded. Securities that have not traded on the date
of valuation, or securities for which sale prices are not generally
reported, are valued at the mean between the last bid and asked prices.
Securities for which market quotations are not readily available are valued
at their fair values as determined by, or under the direction of, the
Trustees. Temporary cash investments are valued at amortized cost. Dividend
income is recorded on the ex-dividend date and interest income is recorded
on the accrual basis.
Gains and losses on sales of investments are calculated on the "identified
cost" method for both financial reporting and federal income tax purposes.
It is the Fund's practice to first select for sale those securities that
have the highest cost and also qualify for long-term capital gain or loss
treatment for tax purposes.
B. Federal Income Taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income and net realized
capital gains, if any, to its shareholders. Therefore, no federal income tax
provision is required.
The characterization of distributions to shareholders for financial
reporting purposes is determined in accordance with federal income tax
rules. Therefore, the source of the Fund's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
C. Fund Shares--The Fund records sales and repurchases of its fund shares on
the trade date. Net losses, if any, as a result of cancellations are
absorbed by Pioneer Funds Distributor, Inc. (PFD), the principal underwriter
for the Fund and an indirect wholly owned subsidiary of The Pioneer
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS-March 31, 1966 (Continued)
Group, Inc. (PGI). PFD earned approximately $71,000 in underwriting
commissions on the sale of fund shares during the six months ended March 31,
1996. Distributions to shareholders are recorded as of the ex-dividend date.
Distributions paid by the Fund, if any, with respect to each class of shares
are calculated in the same manner, at the same time, on the same day and in
the same amount, except that Class A, Class B and Class C shares bear
different transfer agent and distribution fees.
D. Class Allocations--Distribution fees are calculated based on the average
daily net asset value attributable to Class A, Class B and Class C shares of
the Fund, respectively. Shareholders of each class share all expenses and
fees paid to the transfer agent, Pioneering Services Corporation (PSC), for
their services, which are allocated based on number of accounts in each
class and the ratable allocation of related out-of-pocket expense (see Note 3).
Income, common expenses and realized and unrealized gains and losses
are calculated at the Fund level and allocated daily to each class of shares
based on the respective percentage of adjusted net assets at the beginning
of the day.
2. Pioneering Management Corporation (PMC), the Fund's investment adviser,
manages the Fund's portfolio and is a wholly owned subsidiary of PGI.
Management fees are calculated at an annual rate of 0.50% of average daily
net assets up to $250 million; 0.48% of the next $50 million; and 0.45% of
the excess over $300 million. Effective July 1, 1996, PMC will receive a
basic fee at the annual rate of 0.625% of the Fund's average daily net
assets. The basic fee will be subject to a performance adjustment based on
the Fund's investment performance as compared to the appropriate index. From
July 1, 1996 until December 31, 1996, the basic fee will be subject to a
negative adjustment of up to 0.20%. For periods after January 1, 1997, the
basic fee will be adjusted to reflect both increases and decreases up to a
maximum of 0.20%.
In addition, under the management contract, certain other services and
costs, including accounting, regulatory reporting and insurance premiums, are
paid by the Fund. Included in due to affiliates is approximately $65,000 and
$12,000 in management fees and accounting fees, respectively, payable to PMC
at March 31, 1996.
3. PSC, a wholly owned subsidiary of PGI, provides substantially all transfer
agent and shareholder services to the Fund at negotiated rates. Included in
due to affiliates is approximately $171,000 in transfer agent fees payable to
PSC at March 31, 1996.
4. The Fund adopted a Plan of Distribution for each class of shares (Class A
Plan, Class B Plan and Class C Plan) in accordance with Rule 12b-1 of the
Investment Company Act of 1940. Pursuant to the Class A Plan, the Fund pays
PFD a service fee of up to 0.25% of the Fund's average daily net assets in
reimbursement of its actual expenditures to finance activities primarily
intended to result in the sale of Class A shares. The Class A Plan provides
for reimbursement in an amount not to exceed 0.15% on qualifying investments
in the Fund made prior to August 19, 1991. Pursuant to the Class B Plan and
Class C Plan, the Fund pays PFD 1.00% of the average daily net assets
attributable to each class of shares. The fee consists of a 0.25% service fee
and a 0.75% distribution fee paid as compensation for personal services
and/or account maintenance services or distribution services with regard to
Class B and Class C shares. Included in due to affiliates is approximately
$517,000 in distribution fees payable to PFD at March 31, 1996.
In addition, redemptions of each class of shares may be subject to a
contingent deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on
certain net asset value purchases of Class A shares that are redeemed within
one year of purchase. Class B shares that are redeemed within six years of
purchase are subject to a CDSC at declining rates beginning at 4.0%, based on
the lower of cost or market value of shares being redeemed. Redemptions of
Class C shares
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS-March 31, 1966 (Continued)
within one year of purchase are subject to a CDSC of 1.00%. Proceeds from the
CDSC are paid to PFD. For the six months ended, no CDSC was paid to PFD.
5. PMC has entered into certain expense offset arrangements resulting in the
reduction of the Fund's total expenses. For the six months ended March 31,
1996, the Fund's expenses were reduced by approximately $58,000 under such
arrangements.
6. The Fund's investment in certain companies may exceed 5% of the
outstanding voting stock. Such companies are deemed affiliates of the Fund
for financial reporting purposes. The following summarizes transactions with
affiliates of the Fund as of March 31, 1996:
Purchases Sales Dividend
Affiliates Cost Cost Income Value
- -------------------------------- ------- ---- ------- -----------
Allied Healthcare Products $476,250 $-- $ 82,089 $ 5,311,925
American Healthcorp, Inc. -- -- -- 3,737,263
Catherines Stores Corp. -- -- -- 3,900,000
Shelby Williams Industries, Inc. -- -- 65,212 5,007,350
----- -- ----- ---------
TOTAL $476,250 -- $147,301 $17,956,538
===== == ===== =========
16
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE SHAREHOLDERS AND THE BOARD OF TRUSTEES OF PIONEER MID-CAP FUND:
We have audited the accompanying balance sheet of PIONEER MID-CAP FUND
(formerly, Pioneer Three), including the schedule of investments, as of March
31, 1996, and the related statement of operations, statements of changes in
net assets and financial highlights for the periods presented. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights 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 as of March 31, 1996, by correspondence with the custodian.
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 financial highlights referred to
above present fairly, in all material respects, the financial position of
PIONEER MID-CAP FUND as of March 31, 1996, the results of its operations, the
changes in its net assets and the financial highlights for the periods
presented, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
April 26, 1996
17
<PAGE>
INTENTIONALLY LEFT BLANK
<PAGE>
INTENTIONALLY LEFT BLANK
<PAGE>
[COVER]
PIONEER MID-CAP FUND
60 State Street
Boston, Massachusetts 02109
OFFICERS
JOHN F. COGAN, JR., Chairman and President
DAVID D. TRIPPLE, Executive Vice President
ROBERT W. BENSON, Vice President
WILLIAM H. KEOUGH, Treasurer
JOSEPH P. BARRI, Secretary
TRUSTEES
JOHN F. COGAN, JR.
RICHARD H. EGDAHL, M.D.
MARGARET B. W. GRAHAM
JOHN W. KENDRICK
MARGUERITE A. PIRET
DAVID D. TRIPPLE
STEPHEN K. WEST
JOHN WINTHROP
INVESTMENT ADVISER
PIONEERING MANAGEMENT
CORPORATION
PRINCIPAL UNDERWRITER
PIONEER FUNDS
DISTRIBUTOR, INC.
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
INDEPENDENT PUBLIC ACCOUNTANTS
ARTHUR ANDERSEN LLP
LEGAL COUNSEL
HALE AND DORR
SHAREHOLDER SERVICES AND TRANSFER AGENT
PIONEERING SERVICES CORPORATION
60 State Street
Boston, Massachusetts 02109
Please call Pioneer for information on:
Existing accounts, new accounts,
prospectuses, applications,
and service forms 1-800-225-6292
Fund yields and prices 1-800-225-4321
Toll-free fax 1-800-225-4240
Retirement plans 1-800-622-0176
Telecommunications Device for the Deaf
(TDD) 1-800-225-1997
When distributed to persons who are not shareowners of the Fund, this report
must be accompanied by an official prospectus, which discusses the
objectives, policies, and other information about the Fund.
0596-3384
(c) Pioneer Funds Distributor, Inc.
