AXP(SM)
International
Fund
2000 SEMIANNUAL REPORT
American
Express(R)
Funds
(icon of) compass
AXP International Fund seeks to provide shareholders with long-term capital
growth.
AMERICAN
EXPRESS
(R)
<PAGE>
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.
AXPInternational 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 Managers 3
Fund Facts 5
The 10 Largest Holdings 6
Financial Statements 7
Notes to Financial Statements 10
Invetments in Securities 19
<PAGE>
(picture of) Arne H. Carlson
Arne H. Carlson
Chairman of the board
From the Chairman
The financial markets have always had their ups and downs, but in recent months
volatility has become more frequent and intense. While no one can say with
certainty what the markets will do, American Express Financial Corporation, the
Fund's investment manager, expects economic growth to continue this year,
accompanied by a modest rise in long-term interest rates. But no matter what
transpires, this is a great time to take a close look at your goals and
investments. We encourage you to:
o Consult a professional investment advisor who can help you cut through
mountains of data.
o Set financial goals that extend beyond those achievable
through retirement plans of your employer.
o Learn as much as you can about your current investments.
The portfolio managers' letter that follows provides a review of the Fund's
investment strategies and performance. The semiannual report contains other
valuable information as well. The Fund's prospectus describes its investment
objectives and how it intends to achieve those objectives. As experienced
investors know, information is vital to making good investment decisions.
So, take a moment and decide again whether the Fund's investment objectives and
management style fit with your other investments to help you reach your
financial goals. And make it a practice on a regular basis to assess your
investment options.
On behalf of the Board,
Arne H. Carlson
<PAGE>
(picture of) Peter Lamaison
Peter Lamaison
Portfolio Manager
(picture of) Ian King
Ian King
Portfolio Manager
From the Portfolio Managers
It was a volatile six months in worldwide equity markets, but in the end, a
largely productive one. For AXP International Fund's Class A shares, the result
was a total return of 11.66% (excluding the sales charge) for the first half of
the fiscal year -- November 1999 through April 2000.
The first two months could hardly have been better, as stock markets in Europe
and Japan fed off a powerful rally in U.S. stocks. Particularly strong were
stocks in the technology and telecommunications sectors, which were driven by
increasing Arne H. Carlson Chairman of the boardPeter Lamaison Portfolio
managerSEMIANNUAL REPORT -- 2000excitement about the potential of the Internet.
Led by strong gains in stocks such as Ericsson (Sweden), Nokia (Finland) and NTT
Docomo (Japan), the Fund was up by more than 20% through December.
But the new year ushered in a new investment environment, one centered on
concerns about potentially higher inflation and central banks' willingness to
raise interest rates to head off that possibility. As a result, markets in
Europe and Japan struggled for much of the January through March quarter.
SPRING SELL-OFF
The real damage came in April, though, when a steep sell-off in
technology-related stocks roiled markets worldwide, forcing the Fund to give up
a good portion of its gains. Still, the Fund held up relatively well during that
time, thanks to its emphasis on large-capitalization, blue-chip stocks, which
fared better than many high-flying stocks representing small, untested
companies.
Currency fluctuations also played a role in performance during the six months,
as overall declines in the euro and, to a lesser degree, the yen reduced returns
to Fund investors. As is usually the case, we chose not to hedge those
currencies.
Looking at sectors, we maintained the greatest exposure (up to 50% of assets) to
stocks of technology, telecommunications and media companies with strong
earnings growth. We also kept a healthy exposure to pharmaceuticals, which we
increased during the winter. On the other hand, we had relatively small
investments in cyclical and financial services issues.
Japan was the largest in terms of single-country allocation (about one-third of
assets at the peak). Investments in the United Kingdom, France, Germany, Italy
and the Netherlands made up nearly all of the rest and, therefore, the majority
of the portfolio. Late in the period, we reduced our Japanese holdings and moved
more money into Europe, a reflection of our view that Europe offers the better
opportunity for gain, at least over the near term.
Peter Lamaison
Ian King
<PAGE>
<TABLE>
<CAPTION>
Fund Facts
Class A -- 6-month performance
(All figures per share)
Net asset value (NAV)
<S> <C> <C> <C>
April 30, 2000 $12.83
Oct. 31, 1999 $13.45
Decrease $ 0.62
Distributions -- Nov. 1, 1999 - April 30, 2000
From income $ 0.82
From capital gains $ 1.52
Total distributions $ 2.34
Total return* +11.66%**
Class B -- 6-month performance
(All figures per share)
Net asset value (NAV)
April 30, 2000 $12.73
Oct. 31, 1999 $13.32
Decrease $ 0.59
Distributions -- Nov. 1, 1999 - April 30, 2000
From income $ 0.72
From capital gains $ 1.52
Total distributions $ 2.24
Total return* +11.26%**
Class Y -- 6-month performance
(All figures per share)
Net asset value (NAV)
April 30, 2000 $12.84
Oct. 31, 1999 $13.46
Decrease $ 0.62
Distributions -- Nov. 1, 1999 - April 30, 2000
From income $ 0.84
From capital gains $ 1.52
Total distributions $ 2.36
Total return* +11.79%**
*Returns do not include sales load. 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.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
The 10 Largest Holdings
Percent Value
(of net assets) (as of April 30, 2000)
<S> <C> <C>
Ericsson (LM) Cl B (Sweden) 4.44% $72,921,588
Glaxo Wellcome ADR (United Kingdom) 4.32 70,890,679
Nokia (Finland) 3.30 54,182,561
Vodafone AirTouch (United Kingdom) 3.11 51,112,466
Nippon Telegraph & Telephone (Japan) 2.37 39,010,694
Cap Gemini (France) 2.35 38,624,721
EMI Group ADR (United Kingdom) 2.20 36,071,722
Tesco (United Kingdom) 2.16 35,417,685
COLT Telecom Group (United Kingdom) 2.09 34,264,449
Fortis (Netherlands) 1.96 32,159,824
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."
The 10 holdings listed here
make up 28.30% of net assets
(icon of) pie chart
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Financial Statements
Statement of assets and liabilities
AXP International Fund, Inc.
April 30, 2000 (Unaudited)
Assets
Investments in securities, at value (Note 1)
<S> <C> <C>
(identified cost $1,467,846,528) $1,667,227,008
Cash in bank on demand deposit 524,784
Dividends and accrued interest receivable 4,791,628
Receivable for investment securities sold 221,951
U.S. governement securities held as collateral (Note 6) 2,078,002
---------
Total assets 1,674,843,373
Liabilities
Payable for investment securities purchased 1,694,129
Unrealized depreciation on foreign currency contracts held, at value
(Notes 1 and 4) 1,723
Payable upon return of securities loaned (Note 6) 30,078,002
Accrued investment management services fee 32,980
Accrued distribution fee 20,289
Accrued service fee 356
Accrued transfer agency fee 8,533
Accrued administrative services fee 2,128
Other accrued expenses 446,358
-------
Total liabilities 32,284,498
----------
Net assets applicable to outstanding capital stock $1,642,558,875
==============
Represented by
Capital stock-- $.01 par value (Note 1) $ 1,283,036
Additional paid-in capital 1,202,228,309
Net operating loss (3,684,572)
Accumulated net realized gain (loss) 243,545,766
Unrealized appreciation (depreciation) on investments and on
translation of assets and liabilities in foreign currencies (Note 4)
199,186,336
-----------
Total -- representing net assets applicable to outstanding capital stock $1,642,558,875
==============
Net assets applicable to outstanding shares: Class A $1,020,463,580
Class B $ 491,633,315
Class Y $ 130,461,980
Net asset value per share of outstanding capital stock:
Class A shares 79,521,996 $ 12.83
Class B shares 38,623,963 $ 12.73
Class Y shares 10,157,597 $ 12.84
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Statement of operations
AXP International Fund, Inc.
Six months ended April 30, 2000 (Unaudited)
Investment income
Income:
<S> <C>
Dividends $ 6,414,821
Interest 3,039,053
Less foreign taxes withheld (817,061)
--------
Total income 8,636,813
---------
Expenses (Note 2):
Investment management services fee 6,269,338
Distribution fee
Class A 1,288,311
Class B 2,429,516
Transfer agency fee 1,324,890
Incremental transfer agency fee
Class A 89,791
Class B 77,965
Service fee-- Class Y 61,384
Administrative services fees and expenses 397,073
Compensation of board members 5,324
Custodian fees 249,748
Printing and Postage 54,930
Registration fees 38,032
Audit fees 18,750
Other 3,227
-----
Total expenses 12,308,279
Earnings credits on cash balances (Note 2) (40,504)
-------
Total net expenses 12,267,775
----------
Investment income (loss) -- net (3,630,962)
Realized and unrealized gain (loss) -- net Net realized gain (loss) on:
Security transactions (Note 3) 244,620,291
Foreign currency transactions (1,072,356)
----------
Net realized gain (loss) on investments 243,547,935
Net change in unrealized appreciation (depreciation) on investments and on
translation of assets and liabilities in foreign currencies (78,197,813)
-----------
Net gain (loss) on investments and foreign currencies 165,350,122
-----------
Net increase (decrease) in net assets resulting from operations $161,719,160
============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Statements of changes in net assets
AXP International Fund, Inc.
April 30, 2000 Oct. 31, 1999
Six months ended Year ended
(Unaudited)
Operations and distributions
<S> <C> <C>
Investment income (loss)-- net $ (3,630,962) $ 723,368
Net realized gain (loss) on investments 243,547,935 226,747,186
Net change in unrealized appreciation (depreciation) on
investments and on translation of assets and liabilities
in foreign currencies (78,197,813) 97,514,834
----------- ----------
Net increase (decrease) in net assets resulting from
operations 161,719,160 324,985,388
----------- -----------
Distributions to shareholders from:
Net investment income
Class A (9,411,486) (4,224,494)
Class B (1,261,416) --
Class Y (1,209,798) (437,217)
Net realized gain
Class A (146,309,147) (9,585,811)
Class B (69,000,877) (4,617,397)
Class Y (16,679,776) (868,738)
----------- --------
Total distributions (243,872,500) (19,733,657)
------------ -----------
Capital share transactions (Note 5)
Proceeds from sales
Class A shares (Note 2) 246,675,105 316,274,382
Class B shares 76,916,495 60,748,247
Class Y shares 78,797,308 64,974,350
Reinvestment of distributions at net asset value
Class A shares 150,525,587 13,429,933
Class B shares 69,538,729 4,582,019
Class Y shares 17,889,574 1,305,955
Payments for redemptions
Class A shares (226,772,667) (418,453,982)
Class B shares (Note 2) (47,518,427) (114,659,970)
Class Y shares (59,499,352) (55,836,440)
----------- -----------
Increase (decrease) in net assets from capital share
transactions 306,552,352 (127,635,506)
----------- ------------
Total increase (decrease) in net assets 224,399,012 177,616,225
Net assets at beginning of period 1,418,159,863 1,240,543,638
------------- -------------
Net assets at end of period $1,642,558,875 $1,418,159,863
============== ==============
Undistributed net investment income $ (3,684,572) $ 11,829,090
See accompanying notes to financial statements.
</TABLE>
<PAGE>
Notes to Financial Statements
AXP International Fund, Inc.
(Unaudited as to April 30, 2000)
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, incremental transfer agency fee and service fee (class
specific expenses) differ 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 accounting principles generally
accepted in the United States of America 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 AXP INTERNATIONAL FUNDapproximate 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. 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 substantially 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, when available, 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. Interest
income, including level-yield amortization of premium and discount, is accrued
daily.
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 may be adjusted upward or downward by a performance incentive adjustment
based on a comparison of the performance of Class A shares of AXP International
Fund to the Lipper International Funds 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 $220,631 for the six months April
30, 2000.
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. A minor
portion of additional administrative service expenses paid by the Fund are
consultants' fees and office expenses. 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
The Fund has agreements with American Express Financial Advisors Inc. (the
Distributor) for distribution and shareholder services. Under a Plan and
Agreement of Distribution, the Fund pays a distribution fee at an annual rate up
to 0.25% of the Fund's average daily net assets attributable to Class A shares
and up to 1.00% for Class B shares.
Under a Shareholder Service Agreement, the Fund's Class Y shares pay a fee for
service provided to shareholders by financial advisors and other servicing
agents. The fee is calculated at a rate of 0.10% of the Fund's average daily net
assets attributable to Class Y shares.
Sales charges received by the Distributor for distributing Fund shares were
$1,290,907 for Class A and $131,051 for Class B for the six months ended April
30, 2000.
During the six months ended April 30, 2000, the Fund's custodian and transfer
agency fees were reduced by $40,504 as a result of earnings credits from
overnight cash balances. The Fund also pays custodian fees to American Express
Trust Company, an affiliate of AEFC.
3. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of securities (other than short-term
obligations) aggregated $934,170,670 and $1,019,298,270, respectively, for the
six months ended April 30, 2000. Realized gains and losses are determined on an
identified cost basis.
4. FOREIGN CURRENCY CONTRACTS
As of April 30, 2000, the Fund has a foreign currency exchange contract that
obligates it to deliver currency at a specified future date. The unrealized
appreciation and/or depreciation on this contract is included in the
accompanying financial statements. See "Summary of significant accounting
policies." The terms of the open contract are as follows:
Exchange date Currency to Currency to Unrealized Unrealized
be delivered be received appreciation depreciation
May 2, 2000 1,120,518 1,230,662 $-- $1,723
U.S. Dollar European Monetary Unit
Total $-- $1,723
5. CAPITAL SHARE TRANSACTIONS
Transactions in shares of capital stock for the periods indicated are as
follows:
Six months ended April 30, 2000
Class A Class B Class Y
Sold 18,012,406 5,654,755 5,722,914
Issued for reinvested distributions 10,955,436 5,092,217 1,302,955
Redeemed (16,424,716) (3,457,114) (4,305,848)
Net increase (decrease) 12,543,126 7,289,858 2,720,021
Year ended Oct. 31, 1999
Class A Class B Class Y
Sold 26,210,723 5,068,772 5,365,187
Issued for reinvested distributions 1,167,717 399,757 113,551
Redeemed (34,668,112) (9,524,703) (4,600,126)
Net increase (decrease) (7,289,672) (4,056,174) 878,612
6. LENDING OF PORTFOLIO SECURITIES
As of April 30, 2000, securities valued at $28,801,059 were on loan to brokers.
For collateral, the Fund received $28,000,000 in cash and U.S. government
securities valued at $2,078,002. Income from securities lending amounted to
$454,566 for the six months ended April 30, 2000. 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 Express mutual funds, 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 the credit facility at a rate of 0.05%
per annum. The Fund had no borrowings outstanding during the six months ended
April 30, 2000.
<TABLE>
<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
<S> <C> <C> <C> <C> <C>
2000b 1999 1998 1997 1996
Net asset value, beginning of period $13.45 $10.70 $10.57 $10.65 $9.97
Income from investment operations:
Net investment income (loss) (.01) .03 .03 .08 .09
Net gains (losses) (both realized and unrealized) 1.73 2.91 .54 .53 .88
Total from investment operations 1.72 2.94 .57 .61 .97
Less distributions:
Dividends from net investment income (.14) (.06) (.11) (.17) (.15)
Excess distributions from net investment income -- -- (.01) -- --
Distributions from realized gains (2.20) (.13) (.32) (.52) (.14)
Total distributions (2.34) (.19) (.44) (.69) (.29)
Net asset value, end of period $12.83 $13.45 $10.70 $10.57 $10.65
Ratios/supplemental data
Net assets, end of period (in millions) $1,020 $901 $794 $858 $916
Ratio of expenses to average daily net assetsc 1.28%e 1.30% 1.26% 1.18% 1.31%
Ratio of net investment income (loss) to average
daily net assets (.23%)e .27% .52% .86% .95%
Portfolio turnover rate
(excluding short-term securities) 61% 100% 92% 87% 62%
Total returnd 11.66% 27.81% 5.54% 5.90% 9.89%
a For a share outstanding throughout the period. Rounded to the nearest cent.
b Six months ended April 30, 2000 (Unaudited).
c Expense ratio is based on total expenses of the Fund before reduction of
earnings credits on cash balances.
d Total return does not reflect payment of a sales charge.
e Adjusted to an annual basis.
</TABLE>
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<TABLE>
<CAPTION>
Fiscal period ended Oct. 31,
Per share income and capital changesa
Class B Class Y
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
2000b 1999 1998 1997 1996 2000b 1999 1998 1997 1996
Net asset value, beginning of period $13.32 $10.62 $10.50 $10.58 $9.92 $13.46 $10.70 $10.59 $10.67 $9.98
Income from investment operations:
Net investment income (loss) (.06) (.04) .03 .07 .03 -- .05 .04 .08 .10
Net gains (losses)(both realized and unrealized) 1.71 2.87 .44 .46 .87 1.74 2.91 .52 .55 .90
Total from investment operations 1.65 2.83 .47 .53 .90 1.74 2.96 .56 .63 1.00
Less distributions:
Dividends from net investment income (.04) -- (.02) (.09) (.10) (.16) (.07) (.12) (.19) (.17)
Excess distributions from net investment income -- -- (.01) -- -- -- -- (.01) -- --
Distributions from realized gains (2.20) (.13) (.32) (.52) (.14) (2.20) (.13) (.32) (.52) (.14)
Total distributions (2.24) (.13) (.35) (.61) (.24) (2.36) (.20) (.45) (.71) (.31)
Net asset value, end of period $12.73 $13.32 $10.62 $10.50 $10.58 $12.84 $13.46 $10.70 $10.59 $10.67
Ratios/supplemental data
Net assets, end of period (in millions) $492 $417 $376 $396 $404 $130 $100 $70 $76 $77
Ratio of expenses to average daily net assetsc 2.05%e 2.07% 2.02% 1.95% 2.07% 1.12%e 1.18% 1.18% 1.06% 1.13%
Ratio of net investment
income (loss) to average daily net assets (.99%)e(.49%) (.23%) .12% .15% (.03%)e .41% .61% 1.03% 1.13%
Portfolio turnover rate
(excluding short-term securities) 61% 100% 92% 87% 62% 61% 100% 92% 87% 62%
Total returnd 11.26% 26.85% 4.71% 5.09% 9.07% 11.79% 27.91% 5.59% 6.03% 10.11%
a For a share outstanding throughout the period. Rounded to the nearest cent.
b Six months ended April 30, 2000 (Unaudited).
c Expense ratio is based on total expenses of the Fund before reduction of
earnings credits on cash balances.
d Total return does not reflect payment of a sales charge.
e Adjusted to an annual basis.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Investments in Securities
AXP International Fund, Inc.
April 30, 2000 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common stocks (86.2%)(c)
Issuer Shares Value(a)
Australia (1.9%)
Media (0.6%)
<S> <C> <C>
News 830,566 $10,547,008
Metals (1.3%)
Broken Hill Proprietary 978,000 10,531,144
WMC 2,267,000 9,412,324
Total 19,943,468
Brazil (1.2%)
Banks and savings & loans (0.5%)
Uniao de Bancos Brasileiros GRD 320,006 7,980,150
Utilities -- telephone (0.7%)
Embratel Participacoes ADR 498,389 11,213,753
Canada (2.9%)
Communications equipment & services (1.8%)
Nortel Networks 249,800 28,289,850
Energy (0.5%)
Petro-Canada 484,242 8,159,545
Multi-industry conglomerates (0.6%)
Bombardier Cl B 393,322(e) 10,572,172
Finland (5.1%)
Communications equipment & services
Nokia 944,536 54,182,561
Sonera 552,470 30,386,154
Total 84,568,715
France (6.2%)
Banks and savings & loans (1.0%)
Banque Natl de Paris 205,238 16,587,128
Computers & office equipment (2.4%)
Cap Gemini 196,698 38,624,721
Energy (1.7%)
Total Petroleum Cl B 187,821 28,497,853
Industrial equipment & services (0.7%)
Castorama Dubois 54,420 11,873,573
Metals (0.4%)
Usinor 492,871 6,474,597
Germany (3.4%)
Banks and savings & loans (1.4%)
Deutsche Bank 341,782 22,961,765
Computers & office equipment (1.4%)
SAP 41,160 24,209,806
Miscellaneous (0.6%)
Epcos 64,746(b) 9,111,619
Hong Kong (1.8%)
Communications equipment & services (0.9%)
China Telecom 1,948,000(b) 14,067,555
Multi-industry conglomerates (0.9%)
Hutchison Whampoa 1,079,000 15,722,603
Italy (2.9%)
Banks and savings & loans (1.3%)
Instituto Bancario San Paolo di Torino 1,513,070 21,183,192
Utilities -- telephone (1.6%)
Telecom Italia Mobile 2,826,212(e) 26,977,748
Japan (24.9%)
Automotive & related (0.9%)
Toyota Motor 302,000 15,016,806
Chemicals (0.8%)
Asahi Chemical Inds 2,292,000 13,200,833
Computers & office equipment (3.9%)
Canon 490,000 22,414,001
Fujitsu 897,000 25,416,176
Hitachi Software Engineering 153,000 15,654,891
Total 63,485,068
Electronics (5.0%)
Alps Electric 507,000 6,455,160
Hitachi 1,233,000 14,728,182
Kyocera 86,000 14,389,740
Matsushita Communication 90,000 14,117,320
Industrial Nintendo 102,000 17,000,787
Rohm 47,800 16,022,594
Total 82,713,783
Financial services (0.9%)
Nikko Securities 1,300,000 15,347,933
Furniture & appliances (1.2%)
Matsushita Electric Industrial 760,000 20,126,858
Health care (0.2%)
Sankyo 150,000 3,305,709
Industrial equipment & services (1.4%)
Amada 2,598,000 23,671,763
Media (1.9%)
Sony 272,000 31,256,262
Metals (0.7%)
Nippon Steel 5,375,000 12,094,310
Multi-industry conglomerates (0.8%)
Secom 160,000 13,422,844
Retail (1.0%)
FamilyMart 428,000 15,694,060
Textiles & apparel (0.8%)
Asahi Glass 1,421,000 12,473,800
Utilities -- telephone (5.4%)
Nippon Telegraph & Telephone 3,144 39,010,694
Nippon Television Network 17,840 13,331,062
NTT Data 1,041 13,880,643
NTT Mobile Communication Network 650 21,727,857
Total 87,950,256
Korea (0.4%)
Metals
Pohang Iron & Steel ADR 313,495 6,583,395
Mexico (0.9%)
Beverages & tobacco (0.5%)
Fomento Economico Mexicano ADR 198,200 8,175,750
Utilities -- telephone (0.4%)
Telefonos de Mexico ADR Cl L 124,616 7,328,979
Netherlands (3.4%)
Insurance (2.0%)
Fortis 1,278,939 32,159,824
Miscellaneous (1.4%)
United Pan-Europe Communications 630,456(b) 22,943,097
Singapore (0.8%)
Banks and savings & loans
Overseas Union Bank 2,805,665 12,824,018
South Korea (0.6%)
Electronics
Samsung Electronics 38,000 10,272,584
Spain (1.5%)
Energy
Repsol-YPF 1,213,168 24,815,048
Sweden (4.4%)
Communications equipment & services
Ericsson (LM) Cl B 820,162 72,921,588
Turkey (1.2%)
Banks and savings & loans
Garanti Banking 597,949,338(b) 10,072,744
Yapi Kredit Finance 280,670,000 8,951,107
Total 19,023,851
United Kingdom (22.7%)
Aerospace & defense (1.1%)
British Aerospace 3,000,520 18,403,370
Communications equipment & services (1.8%)
Marconi 2,305,784 28,769,132
Health care (6.2%)
Glaxo Wellcome ADR 2,298,794 70,890,679
SmithKline Beecham 2,203,520 30,134,457
Total 101,025,136
Insurance (1.6%)
Prudential 1,695,311 26,021,415
Leisure time & entertainment (2.2%)
EMI Group ADR 3,767,794 36,071,722
Retail (2.7%)
Next 1,181,658 9,243,415
Tesco 10,388,945 35,417,685
Total 44,661,100
Utilities -- gas (1.9%)
BG Group 5,341,435 31,846,472
Utilities -- telephone (5.2%)
COLT Telecom Group 806,558(b) 34,264,449
Vodafone AirTouch 11,149,026 51,112,466
Total 85,376,915
Total common stocks
(Cost: $1,217,101,167) $1,416,550,502
Short-term securities (15.3%)
Issuer Annualized Amount Value(a)
yield on date payable at
of purchase maturity
U.S. government notes (9.3%)
Federal Home Loan Bank Disc Nts
05-19-00 5.89% $22,300,000 $22,223,222
05-24-00 5.85 11,000,000 10,951,300
05-26-00 5.85 7,000,000 6,965,531
05-31-00 5.91 7,000,000 6,962,270
06-21-00 6.04 28,400,000 28,132,848
Federal Home Loan Mtge Corp Disc Nts
05-19-00 5.91 3,100,000 3,089,349
05-23-00 5.99 2,300,000 2,290,464
Federal Natl Mtge Assn Disc Nts
05-16-00 5.90 23,700,000 23,630,261
06-20-00 6.01 20,700,000 20,518,368
06-29-00 6.07 3,100,000 3,066,579
07-13-00 6.26 25,000,000 24,673,833
Total 152,504,025
Commercial paper (6.0%)
Bayer
05-01-00 6.06 2,000,000(d) 1,998,990
Bell Atlantic Finance Services
06-23-00 6.16 9,000,000 8,914,599
CAFCO
06-20-00 6.14 700,000(d) 693,641
Cargill Global Funding
05-08-00 5.86 3,200,000 3,194,693
Corporate Receivables
07-11-00 6.30 5,000,000(d) 4,935,661
Delaware Funding
06-21-00 6.13 5,400,000(d) 5,349,204
Deutsche Bank Financial
07-06-00 6.19 7,200,000 7,113,612
Exxon Asset Management
05-10-00 5.98 29,400,000(d) 29,341,494
Ford Motor Credit
06-02-00 6.08 8,700,000 8,647,236
GMAC
06-28-00 6.15 4,800,000 4,749,085
Heinz (HJ)
06-14-00 6.14 5,400,000 5,357,065
Motorola
06-12-00 6.13 9,000,000 8,931,600
Paccar Financial
05-31-00 6.24 4,500,000 4,474,425
Procter & Gamble
06-08-00 6.12 1,300,000 1,290,745
SBC Communications
06-08-00 6.07 2,600,000(d) 2,582,145
Sheffield Receivables
05-15-00 6.07 600,000(d) 598,286
Total 98,172,481
Total short-term securities
(Cost: $250,745,361) $250,676,506
Total invesments in securities
(Cost: $1,467,846,528)(f) $1,667,227,008
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial
statements.
(b) Non-income producing.
(c) Foreign security values are stated in U.S. dollars.
(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) Security is partially or fully on loan. See Note 6 to the financial
statements.
(f) At April 30, 2000, the cost of securities for federal income tax purposes
was approximately $1,467,847,000 and the approximate aggregate gross unrealized
appreciation and depreciation based on that cost was:
Unrealized appreciation $294,637,000
Unrealized depreciation (95,257,000)
-----------
Net unrealized appreciation $199,380,000
</TABLE>
<PAGE>
American
Express(R)
Funds
AXP International Fund
200 AXP Financial Center
Minneapolis, MN 55474
Ticker Symbol
Class A: INIFX Class B: IWWGX Class Y: IDIYX
PRSRT STD AUTO
U.S. POSTAGE
PAID
AMERICAN
EXPRESS
Distributed by American Express Financial Advisors Inc. Member NASD. American
Express Company is separate from American Express Financial Advisors Inc.
and is not a broker-dealer.
AMERICAN
EXPRESS
S-6340 P (6/00)
