AXP(SM)
International
Fund
1999 SEMIANNUAL REPORT
(icon of) compass
The goal of AXP International Fund is
long-term capital growth.
Distributed by American Express Financial Advisors Inc.
AMERICAN EXPRESS Financial Advisors
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A World of Opportunity
There's a new recognition among investors that the stock market extends beyond
Wall Street. Opportunity abounds in other markets, from Tokyo, London and
Frankfurt to Singapore, Mexico and Hong Kong. Ignoring these opportunities may
mean missing out on tremendous world economic growth in the years ahead.
International Fund focuses on finding the markets that offer the greatest
current potential to investors. With about two-thirds of the world's stock
market value currently based outside of the United States, American investors
now have an even greater opportunity to diversify their portfolios beyond our
boundaries.
CONTENTS
From the Chairman 3
From the Portfolio Manager 4
Fund Facts 5
The 10 Largest Holdings 6
Financial Statements 7
Notes to Financial Statements 10
Investments in Securities 19
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(picture of) Arne H. Carlson
Arne H. Carlson
Chairman of the board
From the Chairman
It is an honor for me to join the American Express(R) Funds as chairman of the
board and chief executive officer for each of the funds. I have served for the
past eight years as governor of Minnesota and also for the past 20 years as a
constitutional officer responsible for the pension investments made on behalf of
government employees. My responsibility in the upcoming years is to serve your
interests.
By law, half the members of a mutual fund board must be independent of their
investment manager and distributor. I am one of those persons. I am not an
employee of American Express Financial Corporation (AEFC), nor do I own stock in
American Express Company. Both are fine companies, but the law clearly states
that to fully represent your interests I must be independent.
Having said that, I have a great deal of respect for the capabilities of AEFC
and for the services it provides to investors. Your financial advisor assists
you in financial planning, conducts regular investment reviews and responds to
your questions and needs. This is a very personal service that makes AEFC a
partner in your financial future. I know that AEFC has an investment focus on
the long-term performance of our economy and that it wants you to participate in
that growth. Consistent with that, our board is here to serve you and represent
your interests in a professional manner.
I also want to let you know that, on June 16, 1999, there will be a regular
meeting of shareholders. These meetings are held about every five years to elect
directors and consider other proposals. One proposal that is expected to be
approved is to change "IDS" to "AXP" in the Fund's name. We will discuss the
action taken on other proposals in future reports.
Arne H. Carlson
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(picture of) Peter Lamaison
Peter Lamaison
Portfolio manager
From the Portfolio Manager
Well-positioned to take advantage of a rebound in European stock markets, AXP
International Fund recorded a substantial gain during the first half of the
fiscal year. For the six months -- November 1998 through April 1999 -- the
Fund's Class A shares generated a total return of 17.08%. (That figure exceeded
the return of the Lipper International Fund Index, which is commonly used to
compare the performance of mutual funds that invest in foreign stocks.)
What a difference a few months can make in the investment world. Not long before
the fiscal year began, markets around the globe were still reeling from a second
bout of the "Asian flu," the financial plague that had first hit in the summer
of 1997. But by last fall, many markets were not only back on their feet, they
were feeling practically robust.
Supported by interest-rate reductions in the United States and Europe, as well
as financial rescue efforts by the International Monetary Fund, stocks made
excellent progress through January. Then, after a bit of a relapse the following
month brought on by rising interest rates in the U.S., they finished the period
with healthy gains in March and April.
EUROPE LEADS THE WAY
The Fund's progress basically followed the same pattern, as it recorded solid
gains in every month but February. By far, the chief contributor to performance
was Europe, where about 70% of the investments were concentrated. The largest
exposure over the period was to the United Kingdom, but I also maintained
considerable holdings in Italy, France, Germany and Spain. About mid-period, on
a highly stock-specific basis, I added to our small position in Japan and
increased holdings in Southeast Asia. Both of those moves paid off.
Looking at types of stocks, I kept the greatest emphasis on banking, which
benefited from falling interest rates, and telecommunications issues, which were
driven by merger activity
and technological advancements; together, they comprised as much as 25% of
assets. Also enhancing the Fund's performance was a reduction in the level of
cash reserves. I put the extra funds to work in stocks, which provided a much
better return than cash.
As for the rest of the fiscal year, I continue to believe that the most
attractive combination of growth and value -- and, consequently, the potential
for stock appreciation -- lies in the European markets, and the portfolio
remains positioned accordingly.
Peter Lamaison
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Fund Facts
Class A -- 6-month performance
(All figures per share)
Net asset value (NAV)
April 30, 1999 $12.32
Oct. 31, 1998 $10.70
Increase $ 1.62
Distributions -- Nov. 1, 1998 - April 30, 1999
From income $ 0.06
From capital gains $ 0.13
Total distributions $ 0.19
Total return* +17.08%**
Class B -- 6-month performance
(All figures per share)
Net asset value (NAV)
April 30, 1999 $12.25
Oct. 31, 1998 $10.62
Increase $ 1.63
Distributions -- Nov. 1, 1998 - April 30, 1999
From income $ --
From capital gains $ 0.13
Total distributions $ 0.13
Total return* +16.62%**
Class Y -- 6-month performance
(All figures per share)
Net asset value (NAV)
April 30, 1999 $12.33
Oct. 31, 1998 $10.70
Increase $ 1.63
Distributions -- Nov. 1, 1998 - April 30, 1999
From income $ 0.07
From capital gains $ 0.13
Total distributions $ 0.20
Total return* +17.12%**
*The prospectus discusses the effect of sales charges, if any, on the various
classes.
**The total return is a hypothetical investment in the Fund with all
distributions reinvested.
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The 10 Largest Holdings
Percent Value
(of net assets) (as of April 30, 1999)
General Electric (United Kingdom) 4.06% $55,150,259
Mannesmann (Germany) 3.97 53,978,143
Total Petroleum Cl B (France) 3.66 49,772,457
UBS (Switzerland) 3.65 49,596,638
Nippon Telegraph & Telephone (Japan) 3.39 46,068,093
Ericsson (LM) Cl B (Sweden) 3.28 44,604,903
Philips Electronics (Netherlands) 3.25 44,221,299
Vodafone (United Kingdom) 3.09 42,021,621
Banque Natl de Paris (France) 2.83 38,425,125
Henkel KGaA (Germany) 2.74 37,238,839
Note: Certain foreign investment risks include changes in currency exchange
rates, adverse political or economic order and lack of similar regulatory
requirements followed by U.S. companies.
For further detail about these holdings, please refer to the section entitled
"Investments in Securities."
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The 10 holdings listed here
make up 33.92% of net assets
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Financial Statements
Statement of assets and liabilities
AXP International Fund, Inc.
April 30, 1999 (Unaudited)
Assets
Investments in securities, at value (Note 1)
<S> <C>
(identified cost $1,319,254,188) $1,583,952,179
Dividends and accrued interest receivable 3,430,448
Receivable for investment securities sold 9,302,982
Unrealized appreciation on foreign currency contracts held, at value (Notes 1 and 4) 53,679
U.S. government securities held as collateral (Note 6) 1,654,435
---------
Total assets 1,598,393,723
-------------
Liabilities
Disbursements in excess of cash on demand deposit 914,671
Payable for investment securities purchased 58,637,153
Unrealized depreciation on foreign currency contracts held, at value (Notes 1 and 4) 94,810
Payable upon return of securities loaned (Note 6) 178,549,281
Accrued investment management services fee 29,232
Accrued distribution fee 8,522
Accrued service fee 6,365
Accrued transfer agency fee 8,404
Accrued administrative services fee 1,839
Other accrued expenses 407,891
-------
Total liabilities 238,658,168
-----------
Net assets applicable to outstanding capital stock $1,359,735,555
==============
Represented by
Capital stock-- $.01 par value (Note 1) $ 1,105,701
Additional paid-in capital 969,500,509
Undistributed net investment income 2,319,356
Accumulated net realized gain (loss) 122,108,293
Unrealized appreciation (depreciation) on investments and on translation
of assets and liabilities in foreign currencies 264,701,696
-----------
Total-- representing net assets applicable to outstanding capital stock $1,359,735,555
==============
Net assets applicable to outstanding shares: Class A $ 857,710,378
Class B $ 413,412,354
Class Y $ 88,612,823
Net asset value per share of outstanding capital stock: Class A shares 69,621,837 $ 12.32
Class B shares 33,758,705 $ 12.25
Class Y shares 7,189,523 $ 12.33
See accompanying notes to financial statements.
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<CAPTION>
Statement of operations
AXP International Fund, Inc.
Six months ended April 30, 1999 (Unaudited)
Investment income
Income:
<S> <C>
Dividends $ 6,416,409
-------------
Interest 3,205,126
Less foreign taxes withheld (1,021,825)
----------
Total income 8,599,710
---------
Expenses (Note 2):
Investment management services fee 5,077,669
Distribution fee-- Class B 1,502,051
Transfer agency fee 1,264,601
Incremental transfer agency fee
Class A 76,477
Class B 72,871
Service fee
Class A 725,023
Class B 348,300
Class Y 39,714
Administrative services fees and expenses 336,484
Compensation of board members 7,382
Custodian fees 528,451
Postage 224,111
Registration fees 90,900
Audit fees 18,500
Other 19,752
------
Total expenses 10,332,286
Earnings credits on cash balances (Note 2) (33,963)
-------
Total net expenses 10,298,323
----------
Investment income (loss) -- net (1,698,613)
----------
Realized and unrealized gain (loss) -- net Net realized gain (loss) on:
Security transactions (Note 3) 128,057,688
Foreign currency transactions (5,498,369)
----------
Net realized gain (loss) on investments 122,559,319
Net change in unrealized appreciation (depreciation) on investments
and on translation of assets and liabilities in foreign currencies 84,832,381
----------
Net gain (loss) on investments and foreign currencies 207,391,700
-----------
Net increase (decrease) in net assets resulting from operations $205,693,087
============
See accompanying notes to financial statements.
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<CAPTION>
Statements of changes in net assets
AXP International Fund, Inc.
April 30, 1999 Oct. 31, 1998
Six months ended Year ended
(Unaudited)
Operations and distributions
<S> <C> <C>
Investment income (loss)-- net $ (1,698,613) $ 3,971,632
Net realized gain (loss) on investments 122,559,319 24,223,708
Net change in unrealized appreciation (depreciation) on investments
and on translation of assets and liabilities in foreign currencies 84,832,381 47,049,739
---------- ----------
Net increase (decrease) in net assets resulting from operations 205,693,087 75,245,079
----------- ----------
Distributions to shareholders from:
Net investment income
Class A (4,223,736) (9,186,555)
Class B -- (1,145,331)
Class Y (437,217) (939,606)
Net realized gain
Class A (9,585,811) (24,556,486)
Class B (4,617,397) (11,617,611)
Class Y (868,738) (2,267,356)
Excess distributions of net investment income
Class A -- (463,530)
Class B -- (220,880)
Class Y -- (40,936)
------ -------
Total distributions (19,732,899) (50,438,291)
----------- -----------
Capital share transactions (Note 5)
Proceeds from sales
Class A shares (Note 2) 151,508,067 1,054,736,380
Class B shares 30,948,685 71,275,697
Class Y shares 33,866,395 56,291,944
Reinvestment of distributions at net asset value
Class A shares 13,429,288 33,310,427
Class B shares 4,581,907 12,902,301
Class Y shares 1,305,955 3,247,898
Payments for redemptions
Class A shares (219,889,306) (1,169,967,176)
Class B shares (Note 2) (54,651,054) (110,226,371)
Class Y shares (27,868,208) (65,318,694)
----------- -----------
Increase (decrease) in net assets from capital share transactions (66,768,271) (113,747,594)
----------- ------------
Total increase (decrease) in net assets 119,191,917 (88,940,806)
Net assets at beginning of period 1,240,543,638 1,329,484,444
------------- -------------
Net assets at end of period $1,359,735,555 $1,240,543,638
============== ==============
Undistributed net investment income $ 2,319,356 $ 8,678,922
------------ -----------
See accompanying notes to financial statements.
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Notes to Financial Statements
AXP International Fund,Inc.
(Unaudited as to April 30, 1999)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Fund is registered under the Investment Company Act of 1940 (as amended) as
a diversified, open-end management investment company. The Fund has 10 billion
authorized shares of capital stock. The Fund invests primarily in common stocks
and securities convertible into common stocks of foreign issuers.
The Fund offers Class A, Class B and Class Y shares.
o Class A shares are sold with a front-end sales charge.
o Class B shares may be subject to a contingent deferred sales charge and
automatically convert to Class A shares during the ninth calendar year
of ownership.
o Class Y shares have no sales charge and are offered only to qualifying
institutional investors.
All classes of shares have identical voting, dividend and liquidation rights.
The distribution fee, transfer agency fee and service fee (class specific
expenses) differs among classes. Income, expenses (other than class specific
expenses) and realized and unrealized gains or losses on investments are
allocated to each class of shares based upon its relative net assets.
The Fund's significant accounting policies are summarized below:
Use of estimates
Preparing financial statements that conform to generally accepted accounting
principles requires management to make estimates (e.g., on assets and
liabilities) that could differ from actual results.
Valuation of securities
All securities are valued at the close of each business day. Securities traded
on national securities exchanges or included in national market systems are
valued at the last quoted sales price. Debt securities are generally traded in
the over-the-counter market and are valued at a price that reflects fair value
as quoted by dealers in these securities or by an independent pricing service.
Securities for which market quotations are not readily available are valued at
fair value according to methods selected in good faith by the board. Short-term
securities maturing in more than 60 days from the valuation date are valued at
the market price or approximate market value based on current interest rates;
those maturing in 60 days or less are valued at amortized cost.
Option transactions
To produce incremental earnings, protect gains, and facilitate buying and
selling of securities for investments, the Fund may buy and write options traded
on any U.S. or foreign exchange or in the over-the-counter market where
completing the obligation depends upon the credit standing of the other party.
The Fund also may buy and sell put and call options and write covered call
options on portfolio securities as well as write cash-secured put options. The
risk in writing a call option is that the Fund gives up the opportunity for
profit if the market price of the security increases. The risk in writing a put
option is that the Fund may incur a loss if the market price of the security
decreases and the option is exercised. The risk in buying an option is that the
Fund pays a premium whether or not the option is exercised. The Fund also has
the additional risk of being unable to enter into a closing transaction if a
liquid secondary market does not exist.
Option contracts are valued daily at the closing prices on their primary
exchanges and unrealized appreciation or depreciation is recorded. The Fund will
realize a gain or loss when the option transaction expires or closes. When an
option is exercised, the proceeds on sales for a written call option, the
purchase cost for a written put option or the cost of a security for a purchased
put or call option is adjusted by the amount of premium received or paid.
Futures transactions
To gain exposure to or protect itself from market changes the Fund may buy and
sell financial futures contracts traded on any U.S. or foreign exchange. The
Fund also may buy and write put and call options on these futures contracts.
Risks of entering into futures contracts and related options include the
possibility of an illiquid market and that a change in the value of the contract
or option may not correlate with changes in the value of the underlying
securities.
Upon entering into a futures contract, the Fund is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Fund each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the contract is closed
or expires.
Foreign currency translations and foreign currency contracts
Securities and other assets and liabilities denominated in foreign currencies
are translated daily into U.S. dollars at the closing rate of exchange. Foreign
currency amounts related to the purchase or sale of securities and income and
expenses are translated at the exchange rate on the transaction date. The effect
of changes in foreign exchange rates on realized and unrealized security gains
or losses is reflected as a component of such gains or losses. In the statement
of operations, net realized gains or losses from foreign currency transactions,
if any, may arise from sales of foreign currency, closed forward contracts,
exchange gains or losses realized between the trade date and settlement date on
securities transactions, and other translation gains or losses on dividends,
interest income and foreign withholding taxes.
The Fund may enter into forward foreign currency exchange contracts for
operational purposes and to protect against adverse exchange rate fluctuation.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using foreign currency exchange rates from an
independent pricing service. The Fund is subject to the credit risk that the
other party will not complete its contract obligations.
Federal taxes
The Fund's policy is to comply with all sections of the Internal Revenue Code
that apply to regulated investment companies and to distribute all of its
taxable income to shareholders. No provision for income or excise taxes is thus
required.
Net investment income (loss) and net realized gains (losses) may differ for
financial statement and tax purposes primarily because of deferred losses on
certain futures contracts, the recognition of certain foreign currency gains
(losses) as ordinary income (loss) for tax purposes and losses deferred due to
"wash sale" transactions. The character of distributions made during the year
from net investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gains (losses) were recorded by
the Fund.
Dividends to shareholders
An annual dividend from net investment income, declared and paid at the end of
the calendar year, is reinvested in additional shares of the Fund at net asset
value or payable in cash. Capital gains, when available, are distributed along
with the income dividend.
Other
Security transactions are accounted for on the date securities are purchased or
sold. Dividend income is recognized on the ex-dividend date or upon receipt of
ex-dividend notification in the case of certain foreign securities. For U.S.
dollar denominated bonds, interest income, including level-yield amortization of
premium and discount, is accrued daily. For foreign bonds the Fund amortizes
premium and original issue discount daily and market discount is recognized at
the time of sale.
2. EXPENSES AND SALES CHARGES
The Fund has agreements with American Express Financial Corporation (AEFC) to
manage its portfolio and provide administrative services. Under an Investment
Management Services Agreement, AEFC determines which securities will be
purchased, held or sold. The management fee is a percentage of the Fund's
average daily net assets in reducing percentages from 0.8% to 0.675% annually.
The fee is adjusted upward or downward by a performance incentive adjustment
based on the Fund's average daily net assets over a rolling twelve-month period
measured against the change in the Lipper International Fund Index. The maximum
adjustment is 0.12% of the Fund's average daily net assets after deducting 1%
from the performance difference. If the performance difference is less than 1%,
the adjustment will be zero. The adjustment increased the fee by $154,008 for
the six months ended April 30, 1999.
Under an Administrative Services Agreement, the Fund pays AEFC a fee for
administration and accounting services at a percentage of the Fund's average
daily net assets in reducing percentages from 0.06% to 0.035% annually.
Additional administrative service expenses paid by the Fund are office expenses,
consultants' fees and compensation of officers and employees. Under this
agreement, the Fund also pays taxes, audit and certain legal fees, registration
fees for shares, compensation of board members, corporate filing fees and any
other expenses properly payable by the Fund and approved by the board.
AEFC has a sub-investment Advisory Agreement with American Express Asset
Management International Inc. (International), a wholly-owned subsidiary of
AEFC.
Under a separate Transfer Agency Agreement, American Express Client Service
Corporation (AECSC) maintains shareholder accounts and records. The Fund pays
AECSC an annual fee per shareholder account for this service as follows:
o Class A $19
o Class B $20
o Class Y $17
Under terms of a prior agreement that ended Jan. 31, 1999, the Fund paid a
transfer agency fee at an annual rate per shareholder account of $15 for Class A
and $16 for Class B. Under terms of a prior agreement that ended March 31, 1999,
the Fund paid a transfer agency fee at an annual rate per shareholder account of
$15 for Class Y.
The Fund has agreements with American Express Financial Advisors Inc. for
distribution and shareholder services. Under a Plan and Agreement of
Distribution, the Fund pays a distribution fee at an annual rate of 0.75% of the
Fund's average daily net assets attributable to Class B shares for distribution
services.
Under a Shareholder Service Agreement, the Fund pays a fee for service provided
to shareholders by financial advisors and other servicing agents. The fee is
calculated at a rate of 0.175% of the Fund's average daily net assets
attributable to Class A and Class B shares and 0.10% of the Fund's average daily
net assets attributable to Class Y shares.
Sales charges received by American Express Financial Advisors Inc. for
distributing Fund shares were $683,714 for Class A and $165,260 for Class B for
the six months ended April 30, 1999. The Fund also pays custodian fees to
American Express Trust Company, an affiliate of AEFC.
During the six months ended April 30, 1999, the Fund's custodian and transfer
agency fees were reduced by $33,963 as a result of earnings credits from
overnight cash balances.
3. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of securities (other than short-term
obligations) aggregated $682,655,762 and $671,904,356, respectively, for the six
months ended April 30, 1999. Realized gains and losses are determined on an
identified cost basis.
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<CAPTION>
4. FOREIGN CURRENCY CONTRACTS
As of April 30, 1999, the Fund has foreign currency exchange contracts that
obligate it to deliver currencies at specified future dates. The unrealized
appreciation and/or depreciation on these contracts is included in the
accompanying financial statements. See "Summary of significant accounting
policies." The terms of the open contracts are as follows:
Exchange date Currency to Currency to Unrealized Unrealized
be delivered be received appreciation depreciation
<S> <C> <C> <C> <C>
May 3, 1999 3,542,836 5,369,561 $10,471 $ --
U.S. Dollar Australian Dollar
May 3, 1999 1,670,906 15,447,527 904 --
U.S. Dollar Mexican Peso
May 3, 1999 2,321,314 2,469,994 17,293 --
European Monetary Unit U.S. Dollar
May 4, 1999 8,170,363 5,054,620 -- 38,491
U.S. Dollar British Pound
May 6, 1999 5,545,596 3,440,954 -- 9,790
U.S. Dollar British Pound
May 6, 1999 14,895,951 14,066,585 -- 33,197
U.S. Dollar European Monetary Unit
May 6, 1999 182,639,158 1,535,531 5,826 --
Japanese Yen U.S. Dollar
May 7, 1999 86,663,213 727,407 1,554 --
Japanese Yen U.S. Dollar
May 28, 1999 3,653,420 3,445,096 -- 13,332
U.S. Dollar European Monetary Unit
May 28, 1999 1,980,962 2,110,715 17,631 --
European Monetary Unit U.S. Dollar
Total $53,679 $94,810
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<CAPTION>
5. CAPITAL SHARE TRANSACTIONS
Transactions in shares of capital stock for the periods indicated are as
follows:
Six months ended April 30, 1999
Class A Class B Class Y
<S> <C> <C> <C>
Sold 13,108,471 2,688,553 2,902,524
Issued for reinvested distributions 1,167,661 399,747 113,552
Redeemed (18,922,837) (4,719,874) (2,385,517)
----------- ---------- ----------
Net increase (decrease) (4,646,705) (1,631,574) 630,559
Year ended Oct. 31, 1998
Class A Class B Class Y
Sold 95,364,241 6,316,469 5,030,741
Issued for reinvested distributions 3,283,757 1,272,541 320,085
Redeemed (105,508,871) (9,929,768) (5,923,253)
------------ ---------- ----------
Net increase (decrease) (6,860,873) (2,340,758) (572,427)
6. LENDING OF PORTFOLIO SECURITIES
As of April 30, 1999, securities valued at $171,210,093 were on loan to brokers.
For collateral, the Fund received $176,894,846 in cash and U.S. government
securities valued at $1,654,435. Income from securities lending amounted to
$270,034 for the six months ended April 30, 1999. The risks to the Fund of
securities lending are that the borrower may not provide additional collateral
when required or return the securities when due.
7. BANK BORROWINGS
The Fund has a revolving credit agreement with U.S. Bank, N.A., whereby the Fund
is permitted to have bank borrowings for temporary or emergency purposes to fund
shareholder redemptions. The Fund must have asset coverage for borrowings not to
exceed the aggregate of 333% of advances equal to or less than five business
days plus 367% of advances over five business days. The agreement, which enables
the Fund to participate with other American Expressfunds, permits borrowings up
to $200 million, collectively. Interest is charged to each Fund based on its
borrowings at a rate equal to the Federal Funds Rate plus 0.30% or the
Eurodollar Rate (Reserve Adjusted) plus 0.20%. Borrowings are payable up to 90
days after such loan is executed. The Fund also pays a commitment fee equal to
its pro rata share of the amount of credit facility at a rate of 0.05% per
annum. The Fund had no borrowings outstanding during the six months ended April
30, 1999.
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<CAPTION>
8. FINANCIAL HIGHLIGHTS
The tables below show certain important financial information for evaluating the
Fund's results.
Fiscal period ended Oct. 31,
Per share income and capital changesa
Class A
1999b 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $10.70 $10.57 $10.65 $9.97 $10.84
Income from investment operations:
Net investment income (loss) (.01) .03 .08 .09 .10
Net gains (losses) (both realized and unrealized) 1.82 .54 .53 .88 (.31)
Total from investment operations 1.81 .57 .61 .97 (.21)
Less distributions:
Dividends from net investment income (.06) (.11) (.17) (.15) --
Excess distributions from net investment income -- (.01) -- -- --
Distributions from realized gains (.13) (.32) (.52) (.14) (.64)
Excess distributions of realized gains -- -- -- -- (.02)
Total distributions (.19) (.44) (.69) (.29) (.66)
Net asset value, end of period $12.32 $10.70 $10.57 $10.65 $ 9.97
Ratios/supplemental data
Net assets, end of period (in millions) $858 $794 $858 $916 $768
Ratio of expenses to average daily net assetsc 1.34%d 1.26% 1.18% 1.31% 1.39%
Ratio of net investment income (loss)
to average daily net assets (.03%)d .52% .86% .95% 1.03%
Portfolio turnover rate
(excluding short-term securities) 55% 92% 87% 62% 52%
Total returne 17.08% 5.54% 5.90% 9.89% (1.66%)
a For a share outstanding throughout the period. Rounded to the nearest cent.
b Six months ended April 30, 1999 (Unaudited).
c Effective fiscal year 1996, expense ratio is based on total expenses of the
Fund before reduction of earnings credits on cash balances.
d Adjusted to an annual basis.
e Total return does not reflect payment of a sales charge.
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<CAPTION>
Fiscal period ended Oct. 31,
Per share income and capital changesa
Class B Class Y
1999b 1998 1997 1996 1995c 1999b 1998 1997 1996 1995c
Net asset value,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
beginning of period $10.62 $10.50 $10.58 $ 9.92 $8.92 $10.70 $10.59 $10.67 $ 9.98 $8.92
Income from investment operations:
Net investment
income (loss) (.02) .03 .07 .03 .04 -- .04 .08 .10 .10
Net gains (losses)
(both realized and
unrealized) 1.78 .44 .46 .87 .96 1.83 .52 .55 .90 .96
Total from investment
operations 1.76 .47 .53 .90 1.00 1.83 .56 .63 1.00 1.06
Less distributions:
Dividends from net
investment income -- (.02) (.09) (.10) -- (.07) (.12) (.19) (.17) --
Excess distributions
from net
investment income -- (.01) -- -- -- -- (.01) -- -- --
Distributions from
realized gains (.13) (.32) (.52) (.14) -- (.13) (.32) (.52) (.14) --
Total distributions (.13) (.35) (.61) (.24) -- (.20) (.45) (.71) (.31) --
Net asset value,
end of period $12.25 $10.62 $10.50 $10.58 $9.92 $12.33 $10.70 $10.59 $10.67 $9.98
Ratios/supplemental data
Net assets, end of
period (in millions) $413 $376 $396 $404 $354 $89 $70 $76 $77 $58
Ratio of expenses to
average daily
net assetse 2.11%d 2.02% 1.95% 2.07% 2.21%d 1.25%d 1.18% 1.06% 1.13% 1.26%d
Ratio of net investment
income (loss) to average
daily net assets (.80%)d (.23%) .12% .15% .69%d .09%d .61% 1.03% 1.13% 1.67%d
Portfolio turnover rate
(excluding short-term
securities) 55% 92% 87% 62% 52% 55% 92% 87% 62% 52%
Total returnf 16.62% 4.71% 5.09% 9.07% 11.21% 17.12% 5.59% 6.03% 10.11% 11.86%
a For a share outstanding throughout the period. Rounded to the nearest cent.
b Six months ended April 30, 1999 (Unaudited).
c Inception date was March 20, 1995.
d Adjusted to an annual basis.
e Effective fiscal year 1996, expense ratio is based on total expenses of the
Fund before reduction of earnings credits on cash balances.
f Total return does not reflect payment of a sales charge.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Investments in Securities
AXP International Fund, Inc.
April 30, 1999 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common stocks (93.5%)
Issuer Shares Value(a)
Australia (2.2%)
Airlines (0.4%)
<S> <C> <C>
Qantas Airways 1,962,000 $5,388,241
Banks and savings & loans (0.4%)
Commonwealth Bank of Australia 317,000 5,771,936
Media (0.2%)
Publishing & Broadcasting 341,500 2,295,358
Metals (0.6%)
Broken Hill Proprietary 690,000 7,800,657
Utilities -- telephone (0.6%)
AAPT 1,548,000(b) 5,531,623
Telstra 418,018 2,268,291
Total 7,799,914
Brazil (0.2%)
Banks and savings & loans
Uniao de Bancos Brasileiros GDR 133,670 3,316,687
Canada (4.4%)
Banks and savings & loans (0.5%)
Toronto-Dominion Bank 115,900 6,191,885
Communications equipment & services (1.9%)
Newbridge Networks 137,700(b) 5,102,800
Nortel Networks 297,100(c) 20,258,506
Total 25,361,306
Energy (0.9%)
Petro-Canada 936,900 12,762,466
Multi-industry conglomerates (1.1%)
Bombardier Cl B 960,100(c) 14,890,379
France (14.9%)
Banks and savings & loans (2.8%)
Banque Natl de Paris 463,566(c) 38,425,125
Building materials & construction (2.4%)
Lafarge 334,412 32,507,254
Electronics (2.3%)
SGS-Thomson Microelectronics 299,184 31,169,229
Energy (3.9%)
Elf Aquitaine 25,317 3,932,242
Total Petroleum Cl B 363,474 49,772,457
Total 53,704,699
Household products (0.9%)
Rhone-Poulenc Cl A 266,581 12,675,127
Industrial equipment & services (2.3%)
Castorama Dubois 128,197 30,680,093
Utilities -- electric (0.3%)
Suez Lyonnaise des Eaux 23,255 3,955,969
Germany (9.5%)
Automotive & related (2.7%)
Volkswagen 508,740(c) 36,068,597
Chemicals (2.8%)
Henkel KGaA 470,548(c) 37,238,839
Industrial equipment & services (4.0%)
Mannesmann 410,005 53,978,143
Hong Kong (1. 0%)
Banks and savings & loans (0.5%)
Hang Seng Bank 604,000 7,149,669
Financial services (0.5%)
Cheung Kong Holdings 750,000 6,821,700
Italy (7.3%)
Banks and savings & loans (6.7%)
Banca Intesa 5,149,979(c) 27,425,183
Instituto Bancario San Paolo di Torino 2,109,700(c) 31,653,307
Unicredito Italiano 5,995,737(c) 30,408,579
Total 89,487,069
Utilities -- telephone (0.6%)
Telecom Italia 785,220 8,354,741
Japan (12.9%)
Automotive & related (1.6%)
Bridgestone 321,000 8,603,378
Toyota Motor 480,000 13,628,688
Total 22,232,066
Banks and savings & loans (0.4%)
Sumitomo Chemical 1,364,000 6,089,169
Chemicals (1.0%)
Asahi Chemical Inds 2,387,000 13,894,727
Communications equipment & services (0.3%)
Hitachi 525,000 3,834,338
Electronics (1.5%)
Matsushita Communication Industrial 292,000 20,959,351
Health care services (0.9%)
Yamanouchi Pharmaceutical 405,000 12,822,138
Household products (0.5%)
Shiseido 424,000 6,676,346
Media (0.9%)
Sony 140,000 13,074,250
Transportation (1.0%)
Kawasaki Kisen Kaisha 6,000,000 14,071,200
Utilities -- telephone (4.8%)
Nippon Telegraph & Telephone 42,310 46,068,093
NTT Mobile Communication Network 3,020 17,705,934
Total 63,774,027
Mexico (0.6%)
Banks and savings & loans (0.1%)
Grupo Financiero Banamex Accival 630,970(b) 1,608,154
Beverages & tobacco (0.5%)
Fomento Economico Mexicano ADR 198,200 7,209,525
Netherlands (5.0%)
Industrial equipment & services (3.3%)
Philips Electronics 513,527 44,221,299
Utilities -- telephone (1.7%)
Equant 257,090 23,333,977
New Zealand (0.6%)
Utilities -- telephone
Telecom Corp of New Zealand 1,460,000 7,604,994
Philippines (0.5%)
Utilities -- telephone
Philippine Long Distance Telephone 227,000 7,342,792
Singapore (3.0%)
Banks and savings & loans (2.5%)
Oversea-Chinese Banking 2,300,000 21,558,590
Overseas Union Bank 2,393,000 12,273,218
Total 33,831,808
Financial services (0.5%)
City Developments 1,056,000 7,034,650
South Korea (0.6%)
Electronics
Samsung Electronics 105,160 8,087,193
Spain (2.5%)
Utilities -- telephone
Telefonica de Espana 739,918 34,672,705
Sweden (3.9%)
Banks and savings & loans (0.7%)
Nordbanken Holding 1,580,343 9,926,292
Communications equipment & services (3.2%)
Ericsson (LM) Cl B 1,699,215 44,604,903
Switzerland (3.7%)
Banks and savings & loans
UBS 146,042 49,596,638
Thailand (0.2%)
Banks and savings & loans
Thai Farmers Bank 864,000(b) 2,395,440
United Kingdom (20.6%)
Banks and savings & loans (0.9%)
Standard Chartered 658,104 11,879,238
Chemicals (1.6%)
Imperial Chemical Inds 2,006,334 21,513,317
Energy (2.2%)
Shell Transport & Trading 3,921,003 29,364,391
Insurance (0.9%)
Allied Zurich 930,897 12,759,805
Multi-industry conglomerates (5.9%)
General Electric 5,225,680 55,150,259
Williams 3,764,496 25,663,699
Total 80,813,958
Retail (2.2%)
Great Universal Stores 2,630,259 29,980,744
Utilities -- telephone (6.9%)
Cable & Wireless Communications 1,485,011(c) 16,950,510
Orange 2,487,986 33,742,564
Vodafone 2,295,235 42,021,621
Total 92,714,695
Total common stocks
(Cost: $1,014,011,552) $1,271,719,213
Other (0.6%)
Issuer Shares Value(a)
Italy (0.5%)
Banca Intesa
Warrants 6,869,950 $7,839,300
Spain (0.1%)
Telefonica
Rights 739,918 687,976
Total other
(Cost: $1,512,248) $8,527,276
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Short-term securities (22.3%)
Issuer Annualized Amount Value(a)
yield on date payable at
of purchase maturity
U.S. government agencies (14.2%)
Federal Home Loan Mtge Corp Disc Nts
<S> <C> <C> <C>
05-06-99 4.75% $8,000,000 $7,994,733
05-10-99 4.77 19,500,000 19,476,893
05-14-99 4.71 9,000,000 8,984,725
05-18-99 4.77 27,900,000 27,837,550
05-20-99 4.76 14,900,000 14,862,764
05-25-99 4.79 3,500,000 3,488,893
06-03-99 4.78 8,300,000 8,263,860
06-04-99 4.78 4,400,000 4,380,282
06-07-99 4.78 12,400,000 12,333,202
06-11-99 4.74 5,300,000 5,271,570
06-16-99 4.76 7,900,000 7,847,914
06-18-99 4.75 21,100,000 20,955,267
06-29-99 4.74 30,000,000 29,768,424
Federal Natl Mtge Assn Disc Nts
05-19-99 4.72 14,000,000 13,967,100
06-04-99 4.80 8,100,000 8,061,817
Total 193,494,994
Commercial paper (8.1%)
Ameritech Capital Funding
05-11-99 4.84 22,400,000(d) 22,370,009
BBV Finance (Delaware)
05-21-99 4.81 5,300,000 5,285,867
BOC Group
05-03-99 4.92 8,000,000 7,997,813
CAFCO
06-01-99 4.84 11,700,000(d) 11,651,539
Ciesco LP
05-11-99 4.82 5,900,000 5,892,117
Delaware Funding
05-11-99 4.88 4,500,000 4,493,937
Fleet Funding
05-28-99 4.83 3,200,000(d) 3,188,456
06-14-99 4.83 17,414,000(d) 17,311,626
General Electric Capital
05-03-99 4.92 14,000,000 13,996,173
GTE Funding
06-03-99 4.84 15,000,000 14,933,725
Salomon Smith Barney
05-26-99 4.84 1,600,000 1,594,656
Thames Asset Global
05-27-99 4.83 1,500,000(d) 1,494,778
Total 110,210,696
Total short-term securities
(Cost: $303,730,388) $303,705,690
Total investments in securities
(Cost: $1,319,254,188)(e) $1,583,952,179
See accompanying notes to investments in securities.
</TABLE>
<PAGE>
SEMIANNUAL REPORT -- 1999
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial
statements. Foreign security values are stated in U.S. dollars.
(b) Non-income producing.
(c) Security is partially or fully on loan. See Note 6 to the financial
statements.
(d) Commercial paper sold within terms of a private placement memorandum, exempt
from registration under Section 4(2) of the Securities Act of 1933, as amended,
and may be sold only to dealers in that program or other "accredited investors."
This security has been determined to be liquid under guidelines established by
the board.
(e) At April 30, 1999, the cost of securities for federal income tax purposes
was approximately $1,319,254,000 and the approximate aggregate gross unrealized
appreciation and depreciation based on that cost was:
Unrealized appreciation $282,933,000
Unrealized depreciation (18,235,000)
-----------
Net unrealized appreciation $264,698,000
<PAGE>
Quick telephone reference
AMERICAN EXPRESS FINANCIAL ADVISORS TELEPHONE TRANSACTION SERVICE
Sales and exchanges, dividend payments or reinvestments and automatic payment
arrangements: 800-437-3133
AMERICAN EXPRESS CLIENT SERVICE CORPORATION
Fund performance, fund prices, account values, recent account transactions and
account inquiries: 800-862-7919
TTY SERVICE
For the hearing impaired: 800-846-4852
TICKER SYMBOL
Class A: INIFX Class B: IWWGX Class Y: IDIYX
S-6340 N (6/99)
BULK RATE
U.S. POSTAGE
PAID
PERMIT NO. 85
SPENCER, IA
AXP International Fund
IDS Tower 10
Minneapolis, MN 55440-0010
