MERRILL
LYNCH
GLOBAL
HOLDINGS
Annual Report November 30, 1993
This report is not authorized for use as an offer of sale
or a solicitation of an offer to buy shares of the Company
unless accompanied or preceded by the Company's current
prospectus. Past performance results shown in this report
should not be considered a representation of future
performance. Investment return and principal value of
shares will fluctuate so that shares, when redeemed,
may be worth more or less than their original cost.
Merrill Lynch
Global Holdings
Box 9011
Princeton, NJ
08543-9011
MERRILL LYNCH GLOBAL HOLDINGS
Officers and
Directors
Arthur Zeikel, President and Director
Donald Cecil, Director
Ken E. Mathysen-Gerst, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
John F. Wallace, Director
Richard R. West, Director
Terry K. Glenn, Executive Vice President
Norman R. Harvey, Senior Vice President
Philip L. Kirstein, Senior Vice President
Donald C. Burke, Vice President
Frederick P. Ives, Vice President
Gerald M. Richard, Treasurer
Robert Harris, Secretary
<PAGE>
Custodian
The Chase Manhattan Bank, N.A.
Global Securities Services
Chase MetroTech Center
Brooklyn, New York 11245
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 637-3863
Important Tax
Information
Merrill Lynch Global Holdings distributed long-term capital gains
of $0.817262 to shareholders of record on December 15, 1992.
Please retain this information for your records.
DEAR SHAREHOLDER
As noted in our August 31, 1993 report to shareholders, Merrill
Lynch International Holdings, Inc. began doing business as
Merrill Lynch Global Holdings as of November 1, 1993. As
investing in overseas markets has become more common, the term
"international fund" has widely come to mean one which invests
exclusively outside of the United States, whereas a "global
fund" is one which may invest within the United States as well
as in other markets. The fund's management believes that the name
"Merrill Lynch Global Holdings" better portrays the fund's
worldwide investment capabilities. The change in the fund's name
does not connote a change in its investment objective, which
remains the same: seeking the highest total investment return
consistent with prudent risk through investment in a globally
diversified portfolio.
During the November quarter, we increased the fund's cash
reserves to 7.9% of net assets, up from 4.8% at the end of the
prior quarter. With the strong performances of many world equity
markets, we believed it appropriate to take profits in some of
the fund's holdings for the near term and place the assets to
work as other attractively valued investments reach our target
purchase prices.
Our investment activities during the last quarter of the fund's
fiscal year focused on North America and on the Asian stock
markets outside of Japan. We made few changes in the fund's
European investments during the period, where we continue to be
moderately underweighted.
<PAGE>
North American Investment Activities
Our weighting in US stocks was unchanged at 31.1% of net assets
from 31.3% at the end of August as we remain concerned that any
increase in interest rates could cause problems for richly valued
stocks. The slow growth, low inflation environment that the
United States has experienced over the last two years has been an
ideal backdrop for equity investments. However, at this point we
believe there is increased risk of at least a modest correction
in view of high valuations relative to historic averages. We
decreased our exposure to Mexico somewhat during the investor
euphoria that followed the passage of the North American Free
Trade Agreement (NAFTA) by the US Congress. Our longer-term
outlook for Mexico, and Latin America in general, remains very
positive and we intend to increase our investments there over
time.
In the United States over the past year we have focused on the
health maintenance organization (HMO) group. We believed the trend
toward reducing medical spending would increase enrollments in HMOs,
which stress preventative care and substantially limit price escalation.
While concerns have been raised that premium increases would moderate,
we believe that membership growth and cost containment would more
than offset this trend. This proved correct as earnings for the
group have remained strong.
Recently, we began diversifying our healthcare exposure into
generic pharmaceutical companies by taking profits in Oxford
Health Plans, Inc. Oxford's earnings growth rate is high, but is
already reflected in its above industry average share valuation.
Generic drugs--that is, the nonpatented chemical and therapeutic
equivalents of brand-name pharmaceuticals--represent another way
to keep medical price inflation in check, and have been elevated
to preferred status in the Clinton Administration's healthcare
cost-containment proposal. The number of important medications
coming off patent is rising and will continue to climb throughout
the 1990s, creating opportunities for generic companies. In
addition, the generic industry is small relative to the major
drug group and should benefit from increased investor interest.
Our initial investments in this area, Marsam Pharmaceuticals Inc.
and Watson Pharmaceutical Inc., are niche manufacturers and
subject to less competition. For example, Marsam Pharmaceuticals
is one of the few developers of off-patent injectable medicines
for the hospital market. In addition to manufacturing off-patent
drugs, Watson Pharmaceutical has been developing a number of new
drug delivery systems. These systems can enhance therapeutic
benefits and reduce side effects by delivering drugs more
efficiently.
<PAGE>
In the media sector we are overweighted in radio broadcasters.
Earlier this year we invested in shares of Infinity Broadcasting
Co., which have appreciated dramatically. Radio is an attractive
medium for advertisers, with the listening audience at an all-
time high. In contrast, television viewing has become more
fragmented with the proliferation of channel choices, and
newspaper readership has declined. In addition, the radio
industry has become more attractive now that the Federal
Communications Commission permits a company to own two AM and two
FM stations in the same market, thus enhancing operating
efficiency and earnings potential. We took profits in Pulitzer
Publishing, an owner of newspapers and television stations, to
invest in two radio companies, Broadcasting Partners Inc. and
Clear Channel Communications Inc. Broadcasting Partners operates
stations in New York, Chicago, Detroit, Charlotte and Dallas, and
has a proven track record of turning around underperforming
properties. Clear Channel Communications operates television as
well as radio stations. Six of Clear Channel Communications'
eight television stations are affiliated with the Fox
Broadcasting Network and have benefited from the expansion of Fox
programming offerings.
Asian Investment Activities
While the Japanese stock market declined during the November
quarter, the Hong Kong and Malaysian markets were buoyant. The
Hong Kong market has been reaching successive record high levels
since October as overseas investors ignored the potential short-
term problems of an overheating economy in The People's Republic
of China and the lack of progress in the Sino-British discussions
regarding the governing of the colony. Strong economic growth and
a favorable inflationary environment spurred other equity markets
in the region.
In contrast, the process of corporate restructuring is proceeding
slowly in Japan, and the government's lack of progress in solving
long-term structural problems has been frustrating. Despite the
adoption of three substantial government fiscal stimulus
packages, the economy and corporate earnings appear to be
deteriorating. With the economy likely to remain at a standstill
longer than had been expected, the Japanese stock market is
likely to remain volatile in the near term. However, we continue
to believe that the new government will gradually move ahead with
the long-awaited income tax cuts and positive deregulatory
measures which will lay the groundwork for economic recovery. As
soon as investors become convinced that the country is moving
ahead to solve wide-ranging problems, we expect that the Japanese
stock market will begin to catch up with other global equity
markets.
<PAGE>
In the meantime, we are still underweighted in Japan. We sharply
reduced the portfolio's Japanese exposure during the November quarter
and have focused more on other Pacific Basin investments. As a result,
the fund was 13.3% invested in other Pacific Basin markets at November
month-end and 18.1% invested in the Japanese market. At the end of the
prior quarter, 24.0% of the fund's net assets were invested in Japan
and 9.8% in other Pacific Basin markets.
We expanded investments in Hong Kong through an initial
investment in Hong Kong Telecommunications Limited and further
purchases of China Light and Power Co., Ltd. and Sun Hung Kai
Properties, Ltd. Hong Kong Telecommunications Limited dominates
the telecommunications market in Hong Kong with a monopoly for
local telephone services (excluding mobile phones and fax/data
transmissions) until 1995. The company has a monopoly on
international telecommunications until 2006. Investor sentiment
toward Hong Kong Telecommunications has been subdued lately
because of the recent international tariff rate cut and the
government's announcement of competing local licensees. However,
our outlook for Hong Kong Telecommunications continues to be
positive, and we expect the company's earnings to grow strongly
over the next several years because of healthy international
traffic growth and successful cost controls. The People's
Republic of China remains the most significant country for the
company both in terms of traffic volume and gross revenues. We
believe that superior growth in China traffic should continue to
have an increasingly positive influence on the company's future
growth.
We increased investments in Singapore through the purchase of
shares of Singapore Telecommunications Limited. As the monopoly
provider of basic telephone services in Singapore, the company
holds an exclusive franchise to provide fixed-line domestic and
international telecommunications services in Singapore until
2007. For wireless services, its exclusive licensing extends
through 1997. In terms of trade as a percentage of gross domestic
product (GDP), which is often used as a barometer of international
telecommunications needs, Singapore ranks highest in the Asian
countries, excluding Japan. With a system that is among the most
technologically advanced in the world, we believe that Singapore
Telecommunications is one of the world's best-managed tele-
communications companies. We expect that the company's earnings
growth will come from increased value-added services and returns
from the growing number of international investments in which the
company is involved.
We also increased the fund's exposure to the Indonesian stock
market through the purchase of additional shares of
P.T. Indocement Tunggal Prakar, the country's largest cement
producer as well as its largest food producer.
<PAGE>
Fiscal Year in Review
Merrill Lynch Global Holdings seeks to achieve superior returns
through a diversified portfolio of equity investments around the
world. We remained nearly fully invested throughout the year,
reflecting our constructive outlook for equities. By reaching
beyond the major markets of the United States, Japan and Europe
and investing in less developed areas such as Latin America and
the Pacific Rim countries, we were able to enhance the fund's
performance. Returns were stronger in these regions than those
in most industrialized markets. In addition, we were able to
outperform the US market by investing in smaller-capitalization
growth stocks. Investments in European interest-rate sensitive
stocks, such as banks and insurance companies, also had a positive
impact on overall investment results. The total return in US dollars
for the unmanaged MSCI World Index for the 12 months ended November
30, 1993 was +17.72%. During the same period the total returns for
the fund's Class A and Class B Shares of +19.16% and +17.87%,
respectively, were somewhat higher.
In Conclusion
We thank you for your investment in Merrill Lynch Global Holdings,
and look forward to serving your financial needs through the fund's
new fiscal year and beyond.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Frederick P. Ives)
Frederick P. Ives
Vice President and Portfolio Manager
January 10, 1994
PERFORMANCE DATA
None of the past results shown should be considered a representation of
future performance. Investment return and principal value of Class A and
Class B Shares will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost.
Average Annual Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 9/30/93 +24.34% +16.26%
Five Years Ended 9/30/93 +11.39 + 9.90
Inception (7/2/84) through 9/30/93 +14.42 +13.59
[FN]
*Maximum sales charge is 6.5%.
**Assuming maximum sales charge.
<PAGE>
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 9/30/93 +23.18% +19.18%
Inception (10/21/88) through 9/30/93 + 9.58 + 9.58
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to
0% after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
Total Return Based on a $10,000 Investment
GRAPHIC MATERIAL APPEARS HERE. SEE APPENDIX: ITEM 1.
<TABLE>
Recent Performance Results*
<CAPTION>
12 Month 3 Month
11/30/93 8/31/93 11/30/92 % Change % Change
<S> <C> <C> <C> <C> <C>
ML Global Holdings Class A Shares $13.07 $13.13 $11.78 +19.16%(1) -0.46%
ML Global Holdings Class B Shares 12.74 12.83 11.62 +17.87(1) -0.70
ML Global Holdings Class A Shares--Total Return +19.16(1) -0.46
ML Global Holdings Class B Shares--Total Return +17.87(1) -0.70
World Stock Index--Total Return** +17.72 -4.92
<FN>
(1)Percent change includes reinvestment of $0.817 per share capital
gains distributions.
*Investment results shown for the 3-month and 12-month periods are
before the deduction of any sales charges.
**The Capital International World Stock Index is an unmanaged US dollar-
denominated index of world stock markets compiled by Capital International
Perspective S.A. and published in Morgan Stanley Capital International Perspective.
</TABLE>
<TABLE>
PERFORMANCE DATA (concluded)
<CAPTION>
Performance Summary--Class A Shares
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
7/2/84-12/31/84 $ 9.15 $ 9.32 -- $0.170 + 3.68%
1985 9.32 12.28 -- 0.340 +36.05
1986 12.28 14.28 $1.270 0.300 +30.25
1987 14.28 11.52 3.638 0.372 + 6.54
1988 11.52 11.01 1.275 0.337 +10.04
1989 11.01 11.77 1.492 0.212 +23.53
1990 11.77 10.28 0.188 0.261 - 9.20
1991 10.28 11.67 0.221 0.123 +17.12
1992 11.67 11.27 0.817 0.063 + 4.28
1/1/93-11/30/93 11.27 13.07 -- -- +15.97
<PAGE>
Total $8.901 Total $2.178
Cumulative total return as of 11/30/93: +242.18%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains distributions
at net asset value on the ex-dividend date, and do not include sales charge;
results would be lower if sales charge was included.
</TABLE>
<TABLE>
<CAPTION>
Performance Summary--Class B Shares
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
10/21/88-12/31/88 $11.29 $11.00 $0.388 $0.147 + 2.22%
1989 11.00 11.71 1.492 0.138 +22.33
1990 11.71 10.20 0.188 0.166 -10.18
1991 10.20 11.56 0.221 0.036 +16.02
1992 11.56 11.09 0.817 0.001 + 3.15
1/1/93-11/30/93 11.09 12.74 -- -- +14.88
Total $3.106 Total $0.488
Cumulative total return as of 11/30/93: +54.42%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains distributions
at net asset value on the ex-dividend date, and do not reflect deduction of any
sales charge; results would be lower if sales charge was deducted.
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS
<CAPTION>
Shares Value Percent of
Industries Held Investments Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
LATIN AMERICA
Argentina
Beverages & Tobacco 27,000 Buenos Aires Embotelladora S.A. (BAESA) (ADR)* $ 737,640 $ 945,000 0.3%
Electronics 30,000 Central Puerto (ADR)* 795,000 840,000 0.3
Energy 50,000 Yacimientos Petroliferos Fiscales S.A.--Sponsored
(ADR)* 950,000 1,237,500 0.4
Telecommunications 40,000 ++++Telecom Argentina Stet--France Telecom S.A.
(ADR)* (1) 1,400,296 1,870,000 0.7
Total Investments in Argentina 3,882,936 4,892,500 1.7
Brazil
Telecommunications 20,000,000 Telecommunicacoes Brasileiras S.A.--Telebras PN
(Preferred) 621,462 700,089 0.2
Total Investments in Brazil 621,462 700,089 0.2
Chile
Chemicals 45,000 Sociedad Quimica y Minera de Chile S.A. (B Shares)
(ADR)* 1,158,750 1,068,750 0.4
Metals 35,000 Madeco S.A. (ADR)* 525,000 748,125 0.2
Utilities 40,000 Enersis S.A. (ADR)* 779,762 785,000 0.3
Total Investments in Chile 2,463,512 2,601,875 0.9
Mexico
Banking
40,000 ++++Grupo Financiero Bancomer, S.A. de C.V. (ADR)* 1,100,000 1,410,000 0.5
Beverages & Tobacco 20,000 Coca-Cola Femsa S.A. (ADR)* 454,319 570,000 0.2
20,000 PanAmerican Beverages Inc. (Shares A) (ADR)* 525,114 727,500 0.2
------------ ------------ -----
979,433 1,297,500 0.4
Broadcasting &
Publishing 25,000 ++++Grupo Televisa, S.A. de C.V. (ADR)* 625,000 1,481,250 0.5
Industrial Components 40,000 Consorcio Grupo Dina, S.A. de C.V. (ADR)* 627,987 880,000 0.3
<PAGE>
Merchandising 500,000 Cifra, S.A. de C.V. (Class 'C') 462,703 1,386,873 0.5
Multi-Industry 120,000 Grupo Carso, S.A. de C.V. 776,634 1,060,474 0.4
Steel 70,000 Grupo Simec, S.A. de C.V. (ADR)* 983,276 1,513,750 0.5
Telecommunications 20,000 Telefonos de Mexico, S.A. de C.V. (ADR)* 545,000 1,115,000 0.4
Total Investments in Mexico 6,100,033 10,144,847 3.5
Venezuela
Steel 100,000 ++++Siderurgica Venezolana SIVENSA, S.A.I.C.A.--
S.A.C.A. (Warrants) (ADR)* (a) 220,000 3,000 0.0
52,000 ++++Venezolana de Prerreducidos Caroni 'Venprecar'
C.A. (GDS)** 379,600 286,000 0.1
------------ ------------ -----
599,600 289,000 0.1
Total Investments in Venezuela 599,600 289,000 0.1
Total Investments in Latin America 13,667,543 18,628,311 6.4
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Shares Held/ Value Percent of
Industries Face Amount Investments Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
NORTH AMERICA
Canada
Appliances 160,000 International Semi-Tech Microelectronics, Inc.
(Installment Receipts) $ 984,765 $ 957,797 0.4%
Beverages & Tobacco 25,000 Cott Corp. 890,625 725,000 0.2
Electrical Equipment 150,000 CMAC Investment Corp. 996,330 954,056 0.3
Energy 40,000 Anderson Exploration, Ltd. 780,233 871,745 0.3
85,000 Enerflex Systems, Ltd. 809,153 898,402 0.3
700,000 Luscar Oil & Gas Ltd. 1,027,500 733,313 0.3
------------ ------------ -----
2,616,886 2,503,460 0.9
Food & Household
Products 160,000 CCL Industries 1,099,257 1,212,212 0.4
Forest Products 40,000 Slocan Forest Products, Ltd. 724,081 826,848 0.3
Oil-Field Equipment 60,000 Canadian Fracmaster, Ltd. 673,200 645,391 0.2
<PAGE>
Total Investments in Canada 7,985,144 7,824,764 2.7
United States
Automobiles 30,000 Ford Motor Co. (8.40% Conv. Pfd.) 1,500,000 3,075,000 1.1
39,400 General Motors Corp. 1,477,263 2,083,275 0.7
------------ ------------ -----
2,977,263 5,158,275 1.8
Banking 35,000 Baybanks, Inc. 1,301,250 1,566,250 0.5
30,000 Chemical New York 817,500 1,155,000 0.4
25,000 Mercantile Bancorporation, Inc. 949,375 1,100,000 0.4
60,000 Midlantic National Bank 1,335,312 1,425,000 0.5
80,000 UJB Financial Corp. 1,602,623 1,930,000 0.7
------------ ------------ -----
6,006,060 7,176,250 2.5
Broadcasting & Publishing 50,000 Broadcasting Partners Inc. (Class A) 725,000 775,000 0.3
30,000 Clear Channel Communications Inc. 1,061,250 1,181,250 0.4
78,750 Infinity Broadcasting Co. (Class A) 671,250 1,988,437 0.7
100,000 Time Warner Inc. 2,832,157 4,412,500 1.5
------------ ------------ -----
5,289,657 8,357,187 2.9
Business Services 100,000 ++Beverly Enterprises 1,206,000 1,225,000 0.4
18,000 Microsoft Corp. 1,503,000 1,440,000 0.4
70,000 Molten Metal Technology, Inc. 1,208,113 1,697,500 0.6
60,000 Oracle Systems Corp. 956,438 1,890,000 0.7
60,000 ++PacifiCare Health Systems (Class 'B') 1,862,500 2,265,000 0.8
11,500 Purus Inc. 161,000 161,000 0.1
80,000 ++Sierra Health Services Inc. 1,341,201 1,280,000 0.4
22,400 United HealthCare Corp. 737,136 1,621,200 0.6
------------ ------------ -----
8,975,388 11,579,700 4.0
Computer Technology 40,000 Novell Inc. 1,253,000 930,000 0.4
Electrical Equipment 50,000 First Pacific Co. Ltd. 871,250 450,000 0.2
70,000 Ultratech Stepper Inc. 1,191,425 1,120,000 0.3
------------ ------------ -----
2,062,675 1,570,000 0.5
Electronics 25,000 Intel Corp. 590,937 1,531,250 0.5
85,000 LSI Logic Corp. 1,350,177 1,264,375 0.4
118,300 Logic Devices Inc. 660,046 561,925 0.2
20,000 Micron Technologies Inc. 1,010,926 925,000 0.3
10,000 Motorola, Inc. 866,290 937,500 0.3
20,000 Texas Instruments, Inc. 1,297,950 1,285,000 0.5
------------ ------------ -----
5,776,326 6,505,050 2.2
<PAGE>
Energy 20,000 Anadarko Petroleum, Inc. 724,326 797,500 0.3
15,000 Chevron Corp. 1,323,615 1,303,125 0.4
30,000 Enron Oil & Gas Co. 924,528 1,158,750 0.4
------------ ------------ -----
2,972,469 3,259,375 1.1
Food & Household
Products 65,000 Performance Food Group Co. 1,010,421 1,283,750 0.4
Health & Personal Care 35,000 Marsam Pharmaceuticals Inc. 773,749 665,000 0.3
50,000 Maybelline Inc. 1,206,802 1,250,000 0.4
58,300 Nutramax Products, Inc. 786,433 655,875 0.2
31,800 Watson Pharmaceutical Inc. 922,200 914,250 0.3
------------ ------------ -----
3,689,184 3,485,125 1.2
Industrial--Other 50,000 Johnson Controls, Inc. 1,950,091 2,662,500 0.9
50,000 Varity Corp. 1,408,040 1,981,250 0.7
------------ ------------ -----
3,358,131 4,643,750 1.6
Insurance 100,000 AFLAC, Inc. 2,261,425 2,700,000 0.9
Leisure 40,000 McDonald's Corp. 1,807,400 2,345,000 0.8
175,000 Mirage Resorts, Inc. 2,647,000 3,850,000 1.3
25,000 Savoy Pictures Entertainment, Inc. 471,375 493,750 0.2
40,000 Walt Disney Co. 1,223,800 1,590,000 0.6
------------ ------------ -----
6,149,575 8,278,750 2.9
Merchandising 30,000 The Home Depot, Inc. 456,275 1,241,250 0.4
30,000 ++Toys 'R' Us, Inc. 750,858 1,222,500 0.4
40,000 Wal-Mart Stores, Inc. 658,900 1,145,000 0.4
------------ ------------ -----
1,866,033 3,608,750 1.2
Multi-Industry 67,900 Addington Resources, Inc. 1,003,379 1,171,275 0.4
30,000 Paramount Communications, Inc. 1,753,342 2,362,500 0.8
------------ ------------ -----
2,756,721 3,533,775 1.2
Oil Field Equipment 30,000 Schlumberger Ltd. 1,752,332 1,725,000 0.6
Railroads 30,000 CSX Corp. 1,993,665 2,490,000 0.9
20,000 Consolidated Rail Corp. 931,200 1,247,500 0.4
------------ ------------ -----
2,924,865 3,737,500 1.3
<PAGE>
Recreation 129,000 Autotote Corp. (Class A) 1,161,000 2,580,000 0.9
25,000 Eastman Kodak Co. 1,346,412 1,521,875 0.5
35,000 Lodgenet Entertainment Corp. 555,143 507,500 0.2
50,000 Mikohn Gaming Corp. 738,125 737,500 0.3
$1,500,000 United Gaming Inc., 7.50% due 9/15/2003 1,500,000 1,545,000 0.5
37,000 WMS Industries, Inc. 1,033,358 1,193,250 0.4
------------ ------------ -----
6,334,038 8,085,125 2.8
Telecommunications 55,000 Newbridge Networks Corp. 855,730 2,695,000 0.9
20,200 Pacific Telesis Group 1,057,876 1,146,350 0.4
------------ ------------ -----
1,913,606 3,841,350 1.3
Textiles 25,000 Fruit of the Loom, Inc. 1,014,975 825,000 0.3
Total Investments in the United States 70,344,144 90,283,712 31.1
Total Investments in North America 78,329,288 98,108,476 33.8
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Shares Value Percent of
Industries Held Investments Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
PACIFIC BASIN
Australia
Banking 120,000 Advance Bank Australia Ltd. $ 792,422 $ 772,406 0.3%
102,637 National Australia Bank, Ltd. 626,209 812,269 0.3
200,000 St. George Bank, Ltd. 873,812 965,508 0.3
------------ ------------ -----
2,292,443 2,550,183 0.9
Broadcasting &
Publishing 150,000 News Corp. Ltd. (Ord) 1,090,627 974,411 0.3
Industrial--Other 300,000 Orbital Engine Corp., Ltd. 628,403 441,206 0.2
Total Investments in Australia 4,011,473 3,965,800 1.4
Hong Kong
Broadcasting &
Publishing 1,500,000 Oriental Press Group 719,704 1,135,996 0.4
Construction
& Housing 2,000,000 Paul Y--ITC Construction Hldg. 734,890 653,764 0.2
Multi-Industry 500,000 Swire Pacific 'A' Ltd. 2,287,425 3,463,007 1.2
<PAGE>
Real Estate 550,000 Sun Hung Kai Properties, Ltd. 2,426,166 3,417,697 1.2
Telecommunications 500,000 Hong Kong Telecommunications Ltd. 1,046,047 951,518 0.3
Utilities 960,000 China Light & Power Co., Ltd. 3,896,550 5,654,735 1.9
Total Investments in Hong Kong 11,110,782 15,276,717 5.2
Indonesia
Cement 200,000 P.T. Indocement Tunggal Prakar 1,423,188 1,569,112 0.5
Textiles 300,000 Indorama Synthetics (Foreign) 841,750 1,027,055 0.4
Total Investments in Indonesia 2,264,938 2,596,167 0.9
Japan
Appliances 80,000 Matsushita Electric Industrial Co. 1,006,889 999,632 0.4
80,000 Rinnai Corp. 1,452,936 2,102,168 0.7
------------ ------------ -----
2,459,825 3,101,800 1.1
Automobiles 30,000 Mabuchi Motor Co. 1,695,519 1,697,905 0.5
300,000 Toyota Motor Corp. 4,148,625 4,520,397 1.6
------------ ------------ -----
5,844,144 6,218,302 2.1
Banking 170,000 The Asahi Bank, Ltd. 1,779,958 1,686,880 0.6
100,000 The Bank of Tokyo, Ltd. 1,301,028 1,304,667 0.5
150,000 The Mitsubishi Bank, Ltd. 3,821,028 3,583,241 1.2
------------ ------------ -----
6,902,014 6,574,788 2.3
Broadcasting &
Publishing 300,000 Tokyo Broadcasting System 3,736,661 3,169,791 1.2
Business Services 140,000 Kamigumi Co., Ltd. 1,684,693 1,363,469 0.5
Construction &
Housing 80,000 Kandenko Co., Ltd. 2,143,145 1,661,154 0.5
120,000 National House Industries 1,925,973 2,205,072 0.8
160,000 Sekisui House Ltd. 1,954,055 1,837,560 0.6
104,000 Taisei Prefab Construction Co. 1,677,874 1,375,965 0.5
------------ ------------ -----
7,701,047 7,079,751 2.4
Electronics 20,000 Keyence Corp. 1,309,685 1,690,555 0.6
40,000 Murata Manufacturing Co., Ltd. 1,057,943 1,286,292 0.4
------------ ------------ -----
2,367,628 2,976,847 1.0
<PAGE>
Financial Services 300,000 Daiwa Securities Co., Ltd. 3,725,815 3,142,227 1.1
100,000 Mitsubishi Trust & Banking Corp. 1,132,517 1,010,658 0.3
------------ ------------ -----
4,858,332 4,152,885 1.4
Industrial--Other 100,000 Futaba Industrial 1,670,788 1,497,611 0.5
Machinery 150,000 Makino Milling Machine 1,086,861 689,085 0.2
Machinery & Equipment 55,000 Aichi Corp. 671,369 439,636 0.2
Merchandising 80,000 Besi Denki Co., Ltd. 844,756 999,632 0.3
60,000 Ito--Yokado Co., Ltd. 2,604,246 2,905,182 1.0
60,000 Keiyo Co., Ltd. 1,087,771 1,091,510 0.4
------------ ------------ -----
4,536,773 4,996,324 1.7
Real Estate 14,000 Cesar Co. 186,822 135,060 0.0
Recreation 50,000 Sony Music Entertainment (Japan) Inc. 2,277,144 2,081,036 0.7
Transportation--Freight 35,000 Aoyama Trading Co. 2,287,334 2,382,856 0.8
200,000 Mitsui & Co. 1,346,038 1,221,977 0.4
------------ ------------ -----
3,633,372 3,604,833 1.2
Utilities 150,000 Sumitomo Electric Industries, Ltd. 1,388,464 1,571,114 0.5
60,000 Tohoku Electric Power 1,442,569 1,631,753 0.6
50,000 Tokyo Electric Power Company, Inc. 1,346,483 1,346,013 0.5
------------ ------------ -----
4,177,516 4,548,880 1.6
Total Investments in Japan 53,794,989 52,630,098 18.1
Malaysia
Automobiles 146,000 Edaran Otomobil Nasional BHD 510,210 816,408 0.3
Banking 400,000 Commerce Asset-Holding BHD 755,787 1,266,961 0.4
Construction
& Housing 150,000 Ekran BHD 573,279 791,851 0.3
Electrical Equipment 250,000 Technology Resources Industries BHD 763,507 1,026,473 0.4
Miscellaneous 133,333 Commerce Asset Holdings (Rights) (b) -- -- --
Telecommunications 350,000 Telekom Malaysia BHD 1,489,928 2,627,771 0.9
Utilities 150,000 Tenaga Nasional BHD 571,393 961,952 0.3
Total Investments in Malaysia 4,664,104 7,491,416 2.6
<PAGE>
Singapore
Air Transport 100,000 Singapore Airlines, Ltd. 383,769 693,837 0.2
Banking 149,500 The Development Bank of Singapore Ltd. 822,928 1,373,703 0.5
Machinery & Equipment 70,000 Jurong Shipyard, Ltd. 212,543 603,825 0.2
Shipping 200,000 Straits Steamship Land 449,139 437,555 0.2
Telecommunications 400,000 Singapore Telecommunications Ltd. 907,320 975,122 0.3
Total Investments in Singapore 2,775,699 4,084,042 1.4
South Korea
Aerospace 20,000 Samsung Aerospace Industries 821,485 841,688 0.3
Banking 75,640 Hanil Bank 1,123,122 954,980 0.3
Construction
& Housing 25,750 Hyundai Engineering and Construction Co. 539,284 742,635 0.3
Utilities 40,000 Korea Electric Power Co. 1,097,115 965,466 0.3
Total Investments in South Korea 3,581,006 3,504,769 1.2
Thailand
Banking 100,000 The Siam Commercial Bank Ltd. 297,564 727,201 0.3
Building Materials 30,000 Siam Cement Group 815,552 952,830 0.3
Total Investments in Thailand 1,113,116 1,680,031 0.6
Total Investments in the Pacific Basin 83,316,107 91,229,040 31.4
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued)
<CAPTION>
Shares Value Percent of
Industries Held Investments Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
WESTERN EUROPE
Belgium
Utilities 5,250 Electrabel NPV $ 912,538 $ 911,157 0.3%
Total Investments in Belgium 912,538 911,157 0.3
Denmark
Telecommunications 4,000 GN Store Nord Holding (GREAT NORDIC) 335,774 344,040 0.1
Total Investments in Denmark 335,774 344,040 0.1
<PAGE>
Finland
Food & Household
Products 40,000 Huhtamaki Corp. 904,752 1,247,922 0.4
Total Investments in Finland 904,752 1,247,922 0.4
France
Broadcasting &
Publishing 5,000 Canal Plus 1,040,635 1,060,925 0.4
Business & Public
Services 4,000 Compagnie Generale des Eaux 1,466,359 1,756,805 0.6
4,000 Compagnie Generale des Eaux (Rights) (c) -- 139,412 0.0
------------ ------------ -----
1,466,359 1,896,217 0.6
Chemicals 37,000 Rhone-Poulenc S.A. 1,044,573 926,013 0.3
Total Investments in France 3,551,567 3,883,155 1.3
Germany
Banking 5,000 Commerzbank AG 781,228 1,045,068 0.4
2,000 Deutsche Bank AG 651,283 987,640 0.3
------------ ------------ -----
1,432,511 2,032,708 0.7
Health &
Personal Care 3,000 Wella AG (Preferred) 1,257,500 1,484,958 0.5
Merchandising 3,500 Hornbach AG (Preferred) 1,880,506 3,346,549 1.2
1,311 Hornbach Baumarkt AG 691,841 802,559 0.3
------------ ------------ -----
2,572,347 4,149,108 1.5
Steel 4,000 Friedrich Grohe (Preferred) 874,709 851,213 0.3
Total Investments in Germany 6,137,067 8,517,987 3.0
Italy
Merchandising 125,000 La Rinascente RISP 285,348 320,550 0.1
Telecommunications 300,000 SIP Italia (Ordinary) 280,800 540,984 0.2
300,000 SIP Italia (Savings) 490,473 461,944 0.2
------------ ------------ -----
771,273 1,002,928 0.4
Textiles 30,000 Fila Holdings S.p.A. (ADR)* 540,000 450,000 0.1
Total Investments in Italy 1,596,621 1,773,478 0.6
<PAGE>
Netherlands
Banking 26,000 ABN Amro Bank N.V. 770,721 944,028 0.3
Beverages & Tobacco 15,000 Heineken N.V. 1,523,893 1,558,989 0.5
Broadcasting &
Publishing 20,000 Wolters Kluwer CVA 739,262 1,098,627 0.4
Construction
& Housing 30,000 IHC Calland N.V. 626,864 617,978 0.2
Food & Household
Products 35,000 Kon Bols Wessanen 798,182 737,360 0.3
Total Investments in the Netherlands 4,458,922 4,956,982 1.7
Norway
Miscellaneous 20,000 Orkla A S-Frie A-Aksjer 571,454 708,050 0.2
Total Investments in Norway 571,454 708,050 0.2
Spain
Banking 9,700 Argentaria Corp. Bancaria de Espana 312,293 413,835 0.1
Business Services 88,000 Acesa Auto Pistas Cesa 1,013,923 858,948 0.3
84,000 Aumar-Autopistas Del Mare Nostrum S.A. 1,031,558 945,127 0.3
------------ ------------ -----
2,045,481 1,804,075 0.6
Utilities 57,000 Empresa Nacional de Electricidad S.A. 1,997,214 2,589,622 0.9
300,000 Iberdola I S.A. 1,977,383 1,944,346 0.7
------------ ------------ -----
3,974,597 4,533,968 1.6
Total Investments in Spain 6,332,371 6,751,878 2.3
Sweden
Health &
Personal Care 170,000 Astra 'B' Fria 2,861,783 3,295,002 1.1
Merchandising 15,000 Hennes & Mauritz 409,324 429,012 0.2
Total Investments in Sweden 3,271,107 3,724,014 1.3
Switzerland
Banking 4,000 Swiss Bank Corp. (Bearer) 849,733 1,280,000 0.4
Food & Household
Products 1,100 Nestle AG 439,670 849,933 0.3
<PAGE>
Health &
Personal Care 361 Roche Holding AG 262,397 1,447,610 0.5
Insurance 2,000 Swiss Reinsurance Co. (PC) 725,688 972,000 0.3
750 Zurich Insurance Co. 707,642 714,000 0.3
------------ ------------ -----
1,433,330 1,686,000 0.6
Recreation 1,500 Societe de Microelectronique et Horlogerie (S.M.H.)
AG (Bearer) 247,411 1,040,000 0.4
7,500 Societe de Microelectronique et Horlogerie (S.M.H.)
AG (Registered) 255,866 1,150,000 0.4
------------ ------------ -----
503,277 2,190,000 0.8
Total Investments in Switzerland 3,488,407 7,453,543 2.6
United Kingdom
Banking 330,000 Bank of Scotland 953,045 948,136 0.3
300,000 National Westminster Bank PLC 1,836,513 2,474,751 0.9
------------ ------------ -----
2,789,558 3,422,887 1.2
Building Materials
& Components 500,000 Spring Ram Corp. PLC 1,450,088 362,845 0.1
Business & Public
Services 125,000 Carlton Communications PLC (Ordinary) 1,292,970 1,538,389 0.5
Energy Sources 450,000 British Petroleum Co. PLC 2,236,817 2,222,611 0.8
150,000 Lasmo PLC (Ordinary) 356,108 246,587 0.1
------------ ------------ -----
2,592,925 2,469,198 0.9
Food & Household
Products 200,000 Cadbury Schweppes PLC 1,741,253 1,378,811 0.5
Industrial--Other 350,000 Tomkins PLC 1,275,666 1,207,756 0.4
Merchandising 100,102 Boots Co. PLC 721,992 798,332 0.3
125,714 Kingfisher PLC 1,115,090 1,284,659 0.4
160,000 Lloyds Chemists PLC 679,285 748,794 0.2
275,000 Next PLC 783,755 806,404 0.3
125,000 Sainsbury (J.) PLC 1,027,202 749,756 0.3
------------ ------------ -----
4,327,324 4,387,945 1.5
Multi-Industry 150,000 Siebe PLC 1,033,849 1,271,809 0.4
Telecommunications 480,000 British Telecommunications PLC (Ordinary) 2,920,756 3,348,245 1.2
Total Investments in the United Kingdom 19,424,389 19,387,885 6.7
Total Investments in Western Europe 50,984,969 59,660,091 20.5
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded)
<CAPTION>
Face Value Percent of
Amount Short-Term Securities Cost (Note 1a) Net Assets
<S> <C> <S> <C> <C> <C>
NORTH AMERICA
United States
Commercial Paper*** $ 6,863,000 Associates Corp. of North America, 3.25%
due 12/01/1993 $ 6,863,000 $ 6,863,000 2.4%
10,000,000 Matterhorn Capital Corp., 3.07% due 12/09/1993 9,993,178 9,993,178 3.4
------------ ------------ -----
16,856,178 16,856,178 5.8
US Government &
Agency Obligations 6,000,000 Federal Home Loan Bank, 3.17% due 1/12/1994 5,977,810 5,977,810 2.1
Total Investments in Short-Term Securities 22,833,988 22,833,988 7.9
Total Investments $249,131,895 290,459,906 100.0
============
Liabilities in Excess of Other Assets (16,411) (0.0)
------------ -----
Net Assets $290,443,495 100.0%
============ =====
<FN>
(a)Warrants entitle the Company to purchase a predetermined number of shares of
common stock. The purchase price and number of shares are subject to adjustment
under certain conditions until the expiration date.
(b)The rights may be exercised until October 7, 1993.
(c)The rights may be exercised until December 20, 1993.
*American Depositary Receipts (ADR).
**Global Depositary Shares (GDS).
***Commercial Paper is traded on a discount basis; the interest rates shown
are the discount rates paid at the time of purchase by the fund.
++Non-income producing security.
++++Restricted securities as to resale. The value of the Company's investment
in restricted securities was approximately $5,050,000, representing 1.7% of net assets.
<CAPTION>
Value
Issue Acquisition Date Cost (Note 1a)
<S> <C> <C> <C>
Grupo Financiero Bancomer, S.A. de C.V. (ADR) 3/16/92 $1,100,000 $1,410,000
Grupo Televisa, S.A. de C.V. (ADR) 12/01/91 625,000 1,481,250
Siderurgica Venezolana SIVENSA, S.A.I.C.A.--S.A.C.A. (Warrants) (ADR) 2/13/92 220,000 3,000
Telecom Argentina Stet--France Telecom S.A. (ADR) 3/23/92-11/12/92 1,400,296 1,870,000
Venezolana de Prerreducidos Caroni 'Venprecar' C.A. (GDS) 2/13/92 379,600 286,000
Total $3,724,896 $5,050,250
========== ==========
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
<CAPTION>
As of November 30, 1993
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$249,131,895) (Note 1a) $290,459,906
Receivables:
Capital shares sold $1,136,657
Dividends 583,193
Securities sold 495,763
Interest 22,060 2,237,673
----------
Prepaid registration fees and other assets (Note 1f) 19,130
------------
Total assets 292,716,709
------------
Liabilities: Payables:
Securities purchased 1,068,125
Capital shares redeemed 642,520
Investment adviser (Note 2) 257,806
Distributor (Note 2) 30,290 1,998,741
----------
Accrued expenses and other liabilities 274,473
------------
Total liabilities 2,273,214
------------
Net Assets: Net assets $290,443,495
============
Net Assets Class A Common Stock, $0.10 par value, 100,000,000 shares authorized $ 1,959,915
Consist of: Class B Common Stock, $0.10 par value, 100,000,000 shares authorized 268,673
Paid-in capital in excess of par 230,529,893
Undistributed investment income--net 475,574
Undistributed realized capital gains on investments and foreign currency
transactions--net 15,899,412
Unrealized appreciation on investments and foreign currency transactions--net 41,310,028
------------
Net assets $290,443,495
============
Net Asset Class A Shares--Based on net assets of $256,202,562 and 19,599,150 shares outstanding $ 13.07
Value: ============
Class B Shares--Based on net assets of $34,240,933 and 2,686,727 shares outstanding $ 12.74
============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended November 30, 1993
<S> <S> <C> <C>
Investment Dividends (net of $322,029 foreign withholding tax) $ 3,631,130
Income Interest and discount earned 446,714
(Notes 1d & 1e): ------------
Total income 4,077,844
------------
Expenses: Investment advisory fees (Note 2) 2,329,402
Transfer agent fees--Class A (Note 2) 335,413
Distribution fees--Class B (Note 2) 256,934
Custodian fees 170,652
Printing and shareholder reports 163,899
Accounting services 111,045
Professional fees 69,564
Registration fees (Note 1f) 56,001
Transfer agent fees--Class B (Note 2) 48,018
Directors' fees and expenses 31,432
Pricing fees 14,029
Amortization of organization expenses (Note 1f) 9,794
Other 6,087
------------
Total expenses 3,602,270
------------
Investment income--net 475,574
------------
Realized & Realized gain (loss) from:
Unrealized Gain Investments--net $ 20,344,160
(Loss) on Foreign currency transactions (1,238,452) 19,105,708
Investments and ------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net 18,292,715
(Notes 1b, 1e & 3): Foreign currency transactions (4,823) 18,287,892
------------ ------------
Net realized and unrealized gain on investments and foreign currency
transactions 37,393,600
------------
Net Increase in Net Assets Resulting from Operations $ 37,869,174
============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CHANGES OF NET ASSETS
<CAPTION>
For the Year Ended November 30,
Increase (Decrease) in Net Assets: 1993 1992
<S> <S> <C> <C>
Operations: Investment income--net $ 475,574 $ 1,329,944
Realized gain on investments and foreign currency transactions--net 19,105,708 8,677,477
Change in unrealized appreciation on investments and foreign currency
transactions--net 18,287,892 9,675,317
------------ ------------
Net increase in net assets resulting from operations 37,869,174 19,682,738
------------ ------------
Dividends & Investment income--net:
Distributions to Class A -- (1,459,188)
Shareholders Class B -- (2,875)
(Note 1g): Realized gain on investments--net:
Class A (11,512,553) (3,337,192)
Class B (1,598,607) (509,713)
------------ ------------
Net decrease in net assets resulting from dividends and distributions
to shareholders (13,111,160) (5,308,968)
------------ ------------
Capital Share Net increase (decrease) in net assets derived from capital share
Transactions transactions 75,813,575 (15,149,240)
(Note 4): ------------ ------------
Net Assets: Total increase (decrease) in net assets 100,571,589 (775,470)
Beginning of year 189,871,906 190,647,376
------------ ------------
End of year* $290,443,495 $189,871,906
============ ============
<FN>
*Undistributed investment income--net (Note 1h) $ 475,574 $ (1,566,434)
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
Class A
------------------------------------------------------------------
For the For the
The following per share data and ratios have been derived For the Year Ended Seven-Month Year Ended
from information provided in the financial statements. November 30, Period Ended April 30,
------------------------------ Nov. 30, -------------------
Increase (Decrease) in Net Asset Value: 1993++++ 1992++++ 1991 1990 1990 1989
<S> <S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 11.78 $ 10.95 $ 10.48 $ 10.91 $ 11.79 $ 12.23
Operating -------- -------- -------- -------- -------- --------
Performance: Investment income--net (1) .04 .10 .16 .17 .20 .29
Realized and unrealized gain (loss) on
investments and foreign currency trans-
actions--net (1) 2.07 1.05 .53 (.30) .62 .88
-------- -------- -------- -------- -------- --------
Total from investment operations 2.11 1.15 .69 (.13) .82 1.17
-------- -------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net -- (.10) (.21) (.13) (.21) (.34)
Realized gain on investments--net (.82) (.22) (.01) (.17) (1.49) (1.27)
-------- -------- -------- -------- -------- --------
Total dividends and distributions (.82) (.32) (.22) (.30) (1.70) (1.61)
-------- -------- -------- -------- -------- --------
Net asset value, end of period $ 13.07 $ 11.78 $ 10.95 $ 10.48 $ 10.91 $ 11.79
======== ======== ======== ======== ======== ========
Total Investment Based on net asset value per share 19.16% 10.67% 6.77% (1.45%)+++ 6.93% 10.99%
Return:** ======== ======== ======== ======== ======== ========
Ratios to Average Expenses 1.43% 1.49% 1.48% 1.59%* 1.49% 1.47%
Net Assets: ======== ======== ======== ======== ======== ========
Investment income (loss)--net .32% (.19%) 1.31% 2.63%* 1.65% 2.04%
======== ======== ======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $256,203 $166,947 $165,687 $176,898 $187,843 $195,932
Data: ======== ======== ======== ======== ======== ========
Portfolio turnover 56.98% 65.93% 63.94% 34.44% 84.21% 102.77%
======== ======== ======== ======== ======== ========
<PAGE>
<CAPTION>
Class B
--------------------------------------------------------------------
For the For the For the
The following per share data and ratios have been derived For the Year Ended Seven-Month Year Period
from information provided in the financial statements. November 30, Period Ended Ended Oct.21,1988++
------------------------------ Nov. 30, April 30, to April 30,
Increase (Decrease) in Net Asset Value: 1993++++ 1992++++ 1991 1990 1990 1989
<S> <S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 11.62 $ 10.82 $ 10.36 $ 10.82 $ 11.74 $ 11.29
Operating -------- -------- -------- -------- -------- --------
Performance: Investment income (loss)--net (1) (.08) (.03) .04 .10 .16 .06
Realized and unrealized gain (loss) on
investments and foreign currency trans-
actions--net (1) 2.02 1.05 .54 (.30) .55 .93
-------- -------- -------- -------- -------- --------
Total from investment operations 1.94 1.02 .58 (.20) .71 .99
-------- -------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net -- --+++++ (.11) (.09) (.14) (.15)
Realized gain on investments--net (.82) (.22) (.01) (.17) (1.49) (.39)
-------- -------- -------- -------- -------- --------
Total dividends and distributions (.82) (.22) (.12) (.26) (1.63) (.54)
-------- -------- -------- -------- -------- --------
Net asset value, end of period $ 12.74 $ 11.62 $ 10.82 $ 10.36 $ 10.82 $ 11.74
======== ======== ======== ======== ======== ========
Total Investment Based on net asset value per share 17.87% 9.58% 5.67% (2.08%)+++ 5.91% 9.10%+++
Return:** ======== ======== ======== ======== ======== ========
Ratios to Average Expenses, excluding distribution fees 1.46% 1.52% 1.51% 1.63%* 1.53% 1.50%*
Net Assets: ======== ======== ======== ======== ======== ========
Expenses 2.46% 2.52% 2.51% 2.63%* 2.53% 2.50%*
======== ======== ======== ======== ======== ========
Investment income (loss)--net (.72%) (1.19%) .25% 1.54%* .65% .10%*
======== ======== ======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $ 34,241 $ 22,925 $ 24,960 $ 22,623 $ 16,342 $ 1,476
Data: ======== ======== ======== ======== ======== ========
Portfolio turnover 56.98% 65.93% 63.94% 34.44% 84.21% 102.77%
======== ======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns excludes the effects of sales loads.
(1)Foreign currency transaction amounts have been reclassified to conform to 1993 presentation.
++Commencement of Operations.
++++Based on average shares outstanding during the period.
+++Aggregate total investment return.
+++++Amount less than $.01 per share.
See Notes to Financial Statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch International Holdings, Inc. is now doing business
under the name Merrill Lynch Global Holdings. Merrill Lynch
Global Holdings (the "Company") is registered under the
Investment Company Act of 1940 as a diversified, open-end
investment management company. The Company offers both Class A
and Class B Shares. Class A Shares are sold with a front-end sales
charge. Class B Shares may be subject to a contingent deferred sales
charge. Both classes of shares have identical voting, dividend,
liquidation and other rights and the same terms and conditions,
except that Class B Shares bear certain expenses related to the
distribution of such shares and have exclusive voting rights with
respect to matters relating to such distribution expenditures. The
following is a summary of significant accounting policies followed
by the Company.
(a) Valuation of securities--Portfolio securities which are
traded on stock exchanges are valued at the last sale price on the
exchange 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 securities
are traded on more than one exchange, the securities are valued on
the exchange designated by or under the authority of the Board of
Directors as the primary market. Securities traded in the over-the-
counter market are valued at the last available bid price in the
over-the-counter market prior to the time of valuation. Options
written by the Company are valued at the last asked price in the case
of exchange-traded options or in the case of options traded in the
over-the-counter market, the average of the last asked price as
obtained from one or more dealers. Options purchased by the
Company are valued at the last bid price in the case of exchange-
traded options or, in the case of options traded in the over-the-
counter market, the average of the last bid price as obtained
from two or more dealers unless there is only one dealer, in
which case that dealer's price is used. Securities with sixty
days or less to maturity are valued at amortized cost, which
approximates market. Securities and assets for which market
quotations are not readily available are valued at fair value as
determined in good faith by or under the direction of the Board
of Directors of the Company.
<PAGE>
(b) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing
when recognized. Assets and liabilities denominated in foreign
currencies are valued at the exchange rate at the end of the
period. Foreign currency transactions are the result of settling
(realized) or valuing (unrealized) such transactions expressed in
foreign currencies into US dollars. Realized and unrealized gains
or losses from investments include the effects of foreign
exchange rates on investments. The Company is authorized to enter
into forward foreign exchange contracts as a hedge against either
specific transactions or portfolio positions. Such contracts are
not entered on the Company's records. However, the effect on opera-
tions is recorded from the date the Company enters into such contracts.
Premium or discount is amortized over the life of the contracts.
(c) Options--The Company can write covered call options and
purchase put options. When the Company writes an option, an
amount equal to the premium received by the Company is reflected
as an asset and an equivalent liability. The amount of the
liability is subsequently marked to market to reflect the current
value of the option written. When a security is sold through an
exercise of an option, the related premium received (or paid) is
deducted from (or added to) the basis of the security sold. When
an option expires (or the Company enters into a closing transaction),
the Company realizes a gain or loss on the option to the extent of
the premiums received or paid (or gain or loss to the extent the
cost of the closing transactions exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(d) Income taxes--It is the Company's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income
tax provision is required. Under the applicable foreign tax law,
a withholding tax may be imposed on interest, dividends, and capital
gains at various rates.
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are
entered into (the trade dates). Dividend income is recorded on
the ex-dividend date, except that if the ex-dividend date has
passed, certain dividends from foreign securities are recorded as
soon as the Company is informed of the ex-dividend date. Interest
income is recognized on the accrual basis. Realized gains and
losses on security transactions are determined on the identified
cost basis.
(f) Deferred organization expenses and prepaid registration
fees--Costs related to the organization of the second class of
shares are charged to expense over a five-year period. Prepaid
registration fees are charged to expense as the related shares
are issued.
<PAGE>
(g) Dividends and distributions--Dividends and distributions paid
by the Company are recorded on the ex-dividend dates.
(h) Reclassifications--Certain 1992 amounts have been
reclassified to conform to the 1993 presentation. Accumulated
Investment loss-net, in the amount of $1,566,434, has been
reclassified to paid-in capital and undistributed realized gains,
as appropriate.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Company has entered into an Investment Advisory Agreement
with Merrill Lynch Asset Management ("MLAM"). MLAM is the name
under which Merrill Lynch Investment Management, Inc. ("MLIM")
does business. MLIM is an indirect wholly-owned subsidiary of
Merrill Lynch & Co., Inc. Pursuant to the Agreement, MLAM will be
responsible for the Company's portfolio and will provide, or
arrange for affiliates to provide, the administrative services
necessary for the operation of the Company.
Effective January 1, 1994, the investment advisory business of
MLAM was reorganized from a corporation to a limited partnership.
The general partner of MLAM is Princeton Services, Inc., an
indirect wholly-owned subsidiary of Merrill Lynch & Co.
As compensation for its services to the Company, the Investment
Adviser receives monthly compensation at the annual rate of 1.0%
of the average daily net assets of the Company. MLAM has entered
into Investment Research Agreements with Lombard Odier Global Port-
folio Management Limited ("LOIPM") and Nomura Capital Manage-
ment, Inc. ("NCM") pursuant to which LOIPM and NCM furnish MLAM
with economic research, securities analysis and investment
recommendations and review and render investment research with
respect to the portfolio of the Company. Pursuant to their
respective Investment Research Agreements, the Investment Adviser
pays LOIPM and NCM fees at the annual rates of 0.15% and 0.20%,
respectively, of the average daily net assets of the Company.
<PAGE>
Certain states in which shares of the Company are qualified for
sale impose limitations on the expenses of the Company. The most
restrictive annual expense limitation requires that the
Investment Adviser reimburse the Company to the extent that
expenses (excluding interest, taxes, distribution fees, brokerage
fees and commissions, and extraordinary items) exceed 2.5% of the
Company's first $30 million of average daily net assets, 2.0% of
the Company's next $70 million of average daily net assets, and
1.5% of the daily net assets in excess thereof. In the event
reimbursement is required pursuant to such limitations, MLAM will
be responsible for the amounts required to be reimbursed, but the
fees paid to LOIPM and NCM will be reduced pro rata. No fee
payment will be made to the Investment Adviser during any fiscal
year which will cause such expenses to exceed the most
restrictive expense limitation at the time of such payment. For
the year ended November 30, 1993, investment advisory fees were
$2,329,402, of which $1,514,112 was paid to MLAM, $349,410 was
paid to LOIPM and $465,880 was paid to NCM under the terms of
their respective research agreements.
The Company has adopted a Plan of Distribution (the "Plan")
pursuant to Rule 12b-1 under the Investment Company Act of 1940
pursuant to which Merrill Lynch Funds Distributor, Inc. ("MLFD" or
"Distributor"), a wholly-owned subsidiary of MLIM, receives a fee from
the Company for the sale of Class B Shares at the end of each month
at the annual rate of 1.0% of the average daily net assets
attributable to Class B Shares of the Company to compensate the
Distributor for services provided and the expenses borne by it under
the Plan. As authorized by the Plan, the Distributor has entered into an
agreement with Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S"),
an affiliate of MLIM, which provides for the compensation of MLPF&S
for providing distribution-related services to the Company. For
the year ended November 30, 1993, MLFD earned $256,934 under the
Plan, all of which was paid to MLPF&S pursuant to the agreement.
For the year ended November 30, 1993, MLFD earned underwriting
discounts of $7,191, and MLPF&S earned dealer concessions of
$118,953 on the sale of the Company's Class A Shares. MLPF&S also
received contingent deferred sales charges of $33,249 relating to
transactions in Class B Shares and $32,094 in commissions on the
execution of portfolio security transactions for the Company
during the year.
Financial Data Services, Inc. ("FDS"), a wholly owned subsidiary
of Merrill Lynch & Co., Inc., acts as the Company's transfer agent.
Accounting services are provided to the Company by MLAM at cost.
Certain officers and/or directors of the Company are officers and/or
directors of MLIM, NCM, LOIPM (including their affiliated companies),
MLPF&S, FDS, MLFD, and/or Merrill Lynch & Co., Inc.
<PAGE>
3. Investments:
Purchases and sales of investments, excluding short-term
securities, for the year ended November 30, 1993 were
$187,497,303 and $127,140,501, respectively.
Net realized and unrealized gains (losses) as of November 30,
1993 were as follows:
Realized Unrealized
Gains Gains
(Losses) (Losses)
Long-term investments $20,344,160 $41,328,011
Put options purchased (935,607) --
Foreign currency transactions (302,845) (17,983)
----------- -----------
Total $19,105,708 $41,310,028
=========== ===========
As of November 30, 1993, net unrealized appreciation for Federal
income tax purposes aggregated $41,328,011, of which $51,388,872
related to appreciated securities and $10,060,861 related to
depreciated securities. The aggregate cost of investments at
November 30, 1993 for Federal income tax purposes was
$249,131,895.
Transactions in put options purchased for the year ended November
30, 1993 were as follows:
Premiums
Par Value Paid
Outstanding put options purchased at
beginning of year -- --
Options purchased $78,263,602 $ 2,074,513
Options expired (49,187,998) (1,302,352)
Options closed (29,075,604) (772,161)
----------- -----------
Outstanding put options purchased at end
of year -- --
=========== ===========
4. Capital Stock Transactions:
Net increase (decrease) in net assets derived from capital share
transactions was $75,813,575 and $15,149,240 for the year ended
November 30, 1993 and November 30, 1992, respectively.
<PAGE>
Transactions in capital shares for Class A and Class B Shares
were as follows:
Class A Shares for the Year Ended Dollar
November 30, 1993 Shares Amount
Shares sold 9,166,536 112,504,555
Shares issued to shareholders in reinvest-
ment of distributions 900,399 9,949,408
----------- -----------
Total issued 10,066,935 122,453,963
Shares redeemed (4,639,892) (55,755,689)
----------- -----------
Net increase 5,427,043 $66,698,274
=========== ===========
Class A Shares for the Year Ended Dollar
November 30, 1992 Shares Amount
Shares sold 2,220,109 27,778,220
Shares issued to shareholders in reinvest-
ment of dividends and distributions 363,981 4,062,931
----------- -----------
Total issued 2,584,090 31,841,151
Shares redeemed (3,549,718) (43,173,181)
----------- -----------
Net decrease (965,628) $(11,332,030)
=========== ===========
Class B Shares for the Year Ended Dollar
November 30, 1993 Shares Amount
Shares sold 1,235,408 $15,456,464
Shares issued to shareholders in reinvest-
ment of distributions 126,908 1,380,757
----------- -----------
Total issued 1,362,316 16,837,221
Shares redeemed (649,303) (7,721,920)
----------- -----------
Net increase 713,013 $ 9,115,301
=========== ===========
NOTES TO FINANCIAL STATEMENTS (concluded)
<PAGE>
Class B Shares for the Year Ended Dollar
November 30, 1992 Shares Amount
Shares sold 526,670 $ 6,357,123
Shares issued to shareholders in reinvest-
ment of dividends and distributions 40,389 442,762
----------- -----------
Total issued 567,059 6,799,885
Shares redeemed (901,191) (10,617,095)
----------- -----------
Net decrease (334,132) $(3,817,210)
=========== ===========
5. Subsequent Event:
On December 15, 1993, the Board of Directors declared an ordinary
income dividend in the amount of $0.371217 per Class A Share and
$0.219221 per Class B Share, and a capital gains distribution of
$0.442875 per Class A Share and Class B Share, payable on
December 22, 1993 to shareholders of record as of December 14,
1993.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders,
Merrill Lynch Global Holdings:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of Merrill
Lynch Global Holdings as of November 30, 1993, the related statements
of operations for the year then ended and changes in net assets
for each of the years in the two-year period then ended, and the
financial highlights for the periods presented. These financial
statements and the financial highlights are the responsibility of
the Company's management. Our responsibility is to express an opinion
on these financial statements and the 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 the 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 at November 30, 1993 by correspondence with the
custodian and brokers. 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.
<PAGE>
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
Merrill Lynch Global Holdings as of November 30, 1993, the results
of its operations, the changes in its net assets, and the financial
highlights for the respective stated periods in conformity with
generally accepted accounting principles.
Deloitte & Touche
Princeton, New Jersey
December 31, 1993
</AUDIT-REPORT>
PORTFOLIO CHANGES
For the Quarter Ended November 30, 1993
Additions
Bank of Scotland
Broadcasting Partners Inc. (Class A)
Buenos Aires Embotelladora S.A. (BAESA) (ADR)
CMAC Investment Corp.
Canadian Fracmaster, Ltd.
Central Puerto (ADR)
Clear Channel Communications Inc.
Coca-Cola Femsa S.A. (ADR)
Commerce-Asset Holdings (Rights)
Compagnie Generale des Eaux (Rights)
Cott Corp.
Enerflex Systems Ltd.
Enersis S.A. (ADR)
GN Store Nord Holding (GREAT NORDIC)
Hong Kong Telecommunications Ltd.
Hornbach Baumarkt AG
IHC Calland N.V.
Lodgenet Entertainment Corp.
Luscar Oil & Gas Ltd.
Marsam Pharmaceuticals Inc.
Mikohn Gaming Corp.
News Corp. Ltd. (Ord)
Next PLC
PanAmerican Beverages Inc. (Shares A)
Paul Y-ITC Construction Hldg.
Purus Inc.
Singapore Telecommunications Ltd.
Slocan Forest Products, Ltd.
Sociedad Quimica y Minera de Chile S.A. (B Shares) (ADR)
Straits Steamship Land
Ultratech Stepper Inc.
United Gaming Inc., 7.50% due 9/15/2003
United HealthCare Corp.
Watson Pharmaceutical Inc.
Zurich Insurance Co.
<PAGE>
Deletions
Bowtex Energy Canada Corp.
Circuit City Stores
Compania Cervecerias Unidas S.A. (ADR)
Dixon Group PLC
HMO America, Inc.
Imperial Oil, Ltd.
Oxford Health Plans, Inc.
Pulitzer Publishing
Societe Generale Surveillance AG (Bearer)
Societe Generale Surveillance AG (Put Warrants)
South China Morning Post Holdings
Sun Microsystems, Inc.
Sungwon Construction Co.
Telefonos de Mexico, S.A. de C.V. (Class 'L')
Transportacion Maritima Mexicana, S.A. de C.V. (ADR)
PORTFOLIO INFORMATION
Worldwide Investments as of November 30, 1993
Percent of
Ten Largest Industries Net Assets
Banking 10.4%
Merchandising 6.7
Utilities 6.3
Broadcasting & Publishing 6.1
Telecommunications 5.8
Business Services 5.1
Recreation 4.3
Automobiles 4.2
Electronics 3.5
Construction & Housing 3.4
Country of Percent of
Ten Largest Equity Holdings Origin Net Assets
China Light & Power Co., Ltd Hong Kong 1.9%
Toyota Motor Corp. Japan 1.6
Time Warner, Inc. United States 1.5
Mirage Resorts, Inc. United States 1.3
The Mitsubishi Bank, Ltd. Japan 1.2
Swire Pacific 'A' Ltd. Hong Kong 1.2
Sun Hung Kai Properties, Ltd. Hong Kong 1.2
British Telecommunications PLC (Ordinary) United Kingdom 1.2
Hornbach AG (Preferred) Germany 1.2
Tokyo Broadcasting System Japan 1.2
<PAGE>
Global Economic Sector Representation As a Percentage
Of Equities as of November 30, 1993
Services 33.0%
Consumer Goods 18.8
Capital Equipment 16.9
Finance 15.8
Energy Sources 7.8
Materials 4.2
Multi-Industry 3.5
APPENDIX: Item 1. Total Return Based on a $10,000 Investment
A line graph depicting the growth of an investment in the fund's
Class A Shares compared to growth of an investment in the Morgan
Stanley Capital World Index. Beginning and ending values are:
7/2/84** 11/30/93
ML Global Holdings++--
Class A Shares* $ 9,350 $31,994
Morgan Stanley Capital
World Index++++ $10,000 $39,302
A line graph depicting the growth of an investment in the fund's
Class B Shares compared to growth of an investment in the Morgan
Stanley Capital World Index. Beginning and ending values are:
10/21/88** 11/30/93
ML Global Holdings++--
Class B Shares* $10,000 $15,442
Morgan Stanley Capital
World Index++++ $10,000 $13,224
[FN]
*Assuming maximum sales charge, transaction costs and other
operating expenses, including advisory fees.
**Commencement of Operations.
++ML Global Holdings invests primarily in an internationally
diversified portfolio of securities.
++++This unmanaged market capitalization-weighted Index is
comprised of a representative sampling of stocks of large-,
medium-, and small-capitalization companies in 22 countries,
including the United States.
