Putnam
Global
Growth
Fund
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
4-30-99
[LOGO: BOSTON * LONDON * TOKYO]
From the Chairman
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[copyright] Karsh, Ottawa
Dear Shareholder:
In the same way that jet travel seemed to shrink the world at mid century
the Internet and other communications breakthroughs are continuing to
narrow the distances between people -- at the speed of light -- as the
century draws to a close. Such dramatic technological developments, then
and now, inevitably capture the attention of investors and generally play
a prominent role in the makeup of growth-oriented portfolios.
As the management team reflects on the current performance of Putnam
Global Growth Fund, we see that this focus on technology was very much the
case during the first half of fiscal 1999. It was not, however, the only
object of the managers' attention; continuing volatility in the global
equity markets kept them well challenged, as you will see in the following
report.
I am pleased to announce the addition of David Santos to the fund's
management team. Dave has been with Putnam since 1986 and is now a member
of the Large Cap Growth Equity Group. He has 13 years of investment
experience.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
June 15, 1999
Report from the Fund Managers
Robert Swift
Lisa Svensson
Kelly A. Morgan
Manuel Weiss Herrero
David Santos
Putnam Global Growth Fund's semiannual period, which ended April 30, 1999,
encompassed a range of market highs and lows that would generally be
expected to occur over much longer periods. Stocks of select larger,
rapidly growing companies, particularly U.S. companies, staged a sustained
rally following the avoidance of a global financial crisis. By April,
however, investors began to allocate additional money to more
value-oriented stocks -- to the detriment of growth stocks -- in cyclical
sectors such as energy and basic industries as signs of a more global
economic recovery began to emerge.
Despite this market backdrop, we believe we were successful in targeting
rapidly growing companies that represent some of the most dynamic
industries of tomorrow. Over this period, the fund outperformed the Morgan
Stanley Capital International All-Country World Free Index, which returned
20.37% for the six months ended April 30, 1999.
Total return for 6 months ended 4/30/99
Class A Class B Class C Class M
NAV POP NAV CDSC NAV CDSC NAV POP
- ----------------------------------------------------------------------------
21.38% 14.42% 20.89% 15.89% 20.97% 19.97% 21.13% 16.84%
- ----------------------------------------------------------------------------
Past performance is no indication of future results. Performance
information for longer periods begins on page 7.
* TECHNOLOGY-RELATED COMPANIES REMAIN FOCUS FOR LONG-TERM GROWTH
Thanks to the global growth of the Internet and the rapidly rising demand
for quick and seamless communication of data, the once-distinct lines
dividing technology-related industries are now blurring. Personal
computer, semiconductor, software, cable, cellular, data communications,
and telecommunications equipment companies are all benefiting today from
this convergence of industries that are moving to address the needs of
consumers and businesses. Certainly U.S.-based companies are leaders in
these industries, and the fund's substantial positions in companies such
as Microsoft, Lucent Technologies, and Intel reflect this leadership.
However, the growth of the Internet is truly global and it puts
significant pressure on both corporations and individuals everywhere to
increase their spending on equipment, ranging from PCs to
telecommunications infrastructure.
[GRAPHIC OMITTED: horizontal bar chart COUNTRY ALLOCATIONS]
COUNTRY ALLOCATIONS*
United
States 48.1%
United
Kingdom 13.5%
Japan 10.9%
France 6.7%
Netherlands 3.0%
Footnote reads:
*Based on net assets as of 4/30/99. Holdings will vary over time.
Morningstar, an independent mutual fund rating agency, gave Putnam Global
Growth Fund's class A shares 4 out of 5 stars for overall performance as of
April 30, 1999 (based on the fund's average annual returns for the 3-, 5-,
and 10-year periods). Only 22.5% of the 944 international equity funds rated
received 4 stars.
Past performance is not indicative of future results. Performance of other
share classes will vary. Morningstar ratings reflect risk-adjusted performance
through 4/30/99 and are subject to change every month. Morningstar ratings are
calculated from a fund's 3-, 5-, and 10-year returns (with fee adjustments) in
excess of 90-day Treasury bill returns and a risk factor that reflects
performance below 90-day Treasury bill returns. For the 3-, 5-, and 10-year
performance, the fund received 4 stars. There were 944, 464, and 112
international equity funds rated, respectively, 10% of the funds in an
investment category receive 5 stars; the next 22.5% receive 4 stars.
For example, there has been an explosion in worldwide demand for cellular
and data communications services. Cellular subscriptions around the world
continue to grow exponentially. We took advantage of this growth through a
position in telecommunications equipment leader Nokia of Finland, which
continues to take market share from rivals Ericsson of Sweden and Motorola
of the United States. U.S.-based QUALCOMM and Lucent Technologies,
Matsushita Communications of Japan, and Northern Telecom of Canada also
benefited from the ever-increasing demand for mobile communications.
The importance of cable as a household's link to the Internet is evident
not only in the United States with AT&T's recent agreement to acquire
MediaOne but also in some of the U.K. holdings we have added to in the
portfolio. We have targeted companies such as Telewest, which has seen its
business fundamentals improve along with the regulatory environment in
Britain. With the bulk of Telewest's high-speed Internet access
infrastructure complete, the company can now focus on growing its customer
base. British Telecom, a top holding of the fund, has also enjoyed
accelerating revenue growth as Internet usage has become more prevalent.
Putnam Global Growth Fund's class A shares were ranked in the top quartile by
Lipper for the 1-year period ended April 30, 1999. The fund ranked in the top
14%, or 32 out of 231 global funds ranked.
Past performance is not indicative of future results. Lipper is an industry
research firm whose rankings are based on total return performance, vary over
time, and do not reflect the effects of sales charges. Performance of other
share classes will vary. The fund was ranked 22 out of 83 funds (27%) for the
five-year period and 6 out 21 (28%) for the 10-year period.
In the past six months, the fund has targeted European IT services
companies involved with business systems upgrades required for one of
three key reasons: the need to incorporate the euro in financial
operations, business consolidations growing out of the wave of merger and
acquisition activity, and Y2K readiness. Examples of fund holdings
benefiting from this demand include Sema and CMG in the United Kingdom and
Cap Gemini in France. Another new type of business seeing explosive growth
worldwide is the outsourcing of data telecommunications services by
multinationals. One company we have focused on is Equant, which is based
in the Netherlands but has an extensive global network. The company offers
strong growth prospects as it provides data services to businesses around
the world. While these holdings, along with others discussed in this
report, were viewed favorably at the end of the period, all are subject to
review and adjustment in accordance with the fund's investment strategy
and may vary in the future.
* STRONG CONSUMER DEMAND BUOYS MAJOR MARKETS
One constant of the past six months has been the strength of U.S. consumer
demand. The U.S. consumer has been credited with helping to avert a global
recession last year and is considered a source of demand that may be
helping to rekindle growth in areas such as Asia. The prevalence of
consumer demand in Europe and Australia has received less attention but is
no less significant. Consumer growth has almost single-handedly kept
European economic growth positive as manufacturing has stalled, and since
1997, consumer demand has made the Australian market a beachhead in an
otherwise uncertain southern Asian market environment. Growth in the
consumer segment of all these economies has been the result of low
interest rates and higher rising personal incomes.
Internet investments move beyond high tech
The Internet is bringing fundamental changes in both the way people
communicate and the way goods and services are bought and sold around the
world. We have positioned the fund in growing industries that are benefiting
now and should continue to benefit from the growth of the Internet. Through
intensive fundamental research, we have identified companies in technology,
telecommunications, financial services, and retail that are growing their
businesses today as a result of the Internet. For example, the convergence of
voice, data, and video through cable and phone lines has created the primary
battleground for telecommunications and cable companies today. The growth of
the Internet has also created an explosion in the volume of data moving
through communications networks (data traffic has now surpassed voice traffic),
forcing telecommunications companies to continually increase the capacity of
their networks and seek more advanced switching technology. Your fund is taking
advantage of this trend through positions in technology and telecommunications
companies as well as in industries such as retail and financial services that
are expanding their business over the Internet.
We have positioned the fund to take advantage of consumer growth in
several different ways. The most significant avenue has been through
large, U.S.-based retailing franchises like Wal-Mart. Additionally we have
targeted well-established, broad-based financial companies such as
American Express, Citigroup, and Providian Financial that prosper as
people become more willing to take advantage of these companies'
wide-ranging services.
Outside the United States, we held Accor of France. This company benefited
from rising occupancy rates -- and thus better pricing -- at its hotel
chains in Europe and the United States. In addition, the increasingly
global food retailing industry was important to the fund. Several past and
current holdings have benefited from a tremendous amount of cross-border
mergers and acquisitions in this area. Within food retailing and to take
advantage of the strong Australian economy, the fund held a position in a
leading supermarket company, Coles Myer.
[GRAPHIC OMITTED: TOP 10 HOLDINGS]
TOP 10 HOLDINGS
Oy Nokia AB Class A
Finland
Telecommunications
Microsoft Corp.
United States
Computer services and software
British Telecommunications
PLC ADR
United Kingdom
Telecommunications
General Electric Co.
United States
Electronics and electrical equipment
Fujitsu Ltd.
Japan
Computer services and software
Wal-Mart Stores, Inc.
United States
Retail
Lucent Technologies, Inc.
United States
Telecommunications
Mannesmann AG
Germany
Business equipment and services
Telewest Communications PLC
United Kingdom
Telecommunications
Intel Corp.
United States
Electronics and electrical equipment
Footnote reads:
These holdings represent 16.0% of the fund's net assets as of 4/30/99.
Portfolio holdings will vary over time.
* JAPANESE STOCKS ADDED TO TAKE ADVANTAGE OF SELECTED GROWTH OPPORTUNITIES
During the fund's semiannual period, we identified several pockets of
growth potential in the otherwise depressed Japanese economic environment.
In addition to telecommunications equipment and pharmaceuticals, one area
that continues to show astounding growth is consumer and business finance.
We targeted this area through companies such as Shohkoh Fund, which lends
to small businesses. As demand for credit continues its relentless rise,
companies such as Shohkoh Fund are able to charge high interest rates
relative to their cost of funds, giving them some of the highest lending
spreads -- and thus profitability -- in the world.
One of the fund's top holdings is Fujitsu, a leading technology company
that owns Japan's largest Internet service provider and has a rapidly
growing software and service business. The company is downsizing less
profitable manufacturing units and focusing instead on the potentially
more profitable software development area -- a type of strategic decision
that until recently was extremely rare in Japanese business.
* GROWTH STILL PREVALENT DESPITE RECENT MOVE TO CYCLICALS
The recent upsurge in the stock prices of cyclical and value-oriented
companies has come as a result of investors' belief that the world outside
the United States may be entering an expansionary phase. However, we do
not find the level of superior revenue and earnings growth rates that our
growth investment discipline demands in companies of this type.
Instead, in continuing our focus on high-quality large-capitalization
growth stocks from around the world, we will maintain our
company-by-company, research-driven strategy of evaluating individual
stocks. While the United States currently still offers attractive growth
companies, we are continuously reevaluating new opportunities in the
United Kingdom and Japan while maintaining a strong presence in
fast-growing Continental European companies that are poised to benefit
from more open markets in that region.
The views expressed here are exclusively those of Putnam Management. They
are not meant as investment advice. Although the described holdings were
viewed favorably as of 4/30/99, there is no guarantee the fund will
continue to hold these securities in the future. International investing
involves certain risks, including economic instability, political
developments, and currency fluctuations.
<TABLE>
<CAPTION>
Performance summary
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
Global Growth Fund is designed for investors seeking capital appreciation
through a globally diversified equity portfolio.
TOTAL RETURN FOR PERIODS ENDED 4/30/99
Class A Class B Class C Class M
(inception dates) (9/1/67) (4/27/92) (2/1/99) (3/1/95)
NAV POP NAV CDSC NAV CDSC NAV POP
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 months 21.38% 14.42% 20.89% 15.89% 20.97% 19.97% 21.13% 16.84%
- -------------------------------------------------------------------------------------
1 year 14.32 7.77 13.40 8.40 13.46 12.46 13.82 9.84
- -------------------------------------------------------------------------------------
5 years 103.65 91.98 95.99 93.99 96.07 96.07 98.48 91.56
Annual average 15.29 13.93 14.41 14.17 14.41 14.41 14.69 13.88
- -------------------------------------------------------------------------------------
10 years 231.35 212.30 206.18 206.18 207.49 207.49 214.32 203.32
Annual average 12.73 12.06 11.84 11.84 11.89 11.89 12.13 11.74
- -------------------------------------------------------------------------------------
Annual average
(life of fund) 11.15 10.94 10.10 10.10 10.31 10.31 10.39 10.26
- -------------------------------------------------------------------------------------
</TABLE>
COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 4/30/99
MSCI
World Consumer
Free Index price index
- ----------------------------------------------------------------------------
6 months 20.37% 1.47%
- ----------------------------------------------------------------------------
1 year 15.09 2.28
- ----------------------------------------------------------------------------
5 years 109.53 12.75
Annual average 15.95 2.43
- ----------------------------------------------------------------------------
10 years 189.85 35.01
Annual average 11.23 3.05
- ----------------------------------------------------------------------------
Annual average
(life of fund) 11.55* 5.19
- ----------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. Returns for class A and class M
shares reflect the current maximum initial sales charges of 5.75% and
3.50% respectively. Class B share returns for the 1-year and life-of-fund
periods reflect the applicable contingent deferred sales charge (CDSC),
which is 5% in the first year, declines to 1% in the sixth year, and is
eliminated thereafter. Returns shown for class B and class M shares for
periods prior to their inception are derived from the historical
performance of class A shares, adjusted to reflect both the initial sales
charge or CDSC, if any, currently applicable to each class and in the case
of class B and class M shares the higher operating expenses applicable to
such shares. For class C shares, returns for periods prior to their
inception are derived from the historical performance of class A shares,
adjusted to reflect both the CDSC currently applicable to class C shares,
which is 1% for the first year and is eliminated thereafter, and the
higher operating expenses applicable to class C shares. All returns assume
reinvestment of distributions at NAV. Investment return and principal
value will fluctuate so that an investor's shares when redeemed may be
worth more or less than their original cost.
* Index did not exist prior to 1969.
PRICE AND DISTRIBUTION INFORMATION
6 MONTHS ENDED 4/30/99
Class A Class B Class C Class M
- ------------------------------------------------------------------------------
Distributions (number) 1 1 1 1
- ------------------------------------------------------------------------------
Income $0.048 $ -- $ -- $ --
- ------------------------------------------------------------------------------
Capital gains
Long-term 0.323 0.323 -- 0.323
- ------------------------------------------------------------------------------
Short-term -- -- -- --
- ------------------------------------------------------------------------------
Total $0.371 $0.323 $ -- $0.323
- ------------------------------------------------------------------------------
Share value: NAV POP NAV NAV NAV POP
- ------------------------------------------------------------------------------
10/31/98 $11.01 $11.68 $10.59 $ -- $10.90 $11.30
- ------------------------------------------------------------------------------
2/1/99* -- -- -- 12.97 -- --
- ------------------------------------------------------------------------------
4/30/99 12.97 13.76 12.46 12.95 12.86 13.33
- ------------------------------------------------------------------------------
* Inception date of class C shares.
<TABLE>
<CAPTION>
TOTAL RETURN FOR PERIODS ENDED 03/31/99 (most recent calendar quarter)
Class A Class B Class C Class M
(inception dates) (9/1/67) (4/27/92) (2/1/99) (3/1/95)
NAV POP NAV CDSC NAV CDSC NAV POP
- --------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 months 25.47% 18.27% 25.08% 20.08% 25.01% 24.01% 25.13% 20.73%
- --------------------------------------------------------------------------------------
1 year 15.08 8.46 14.25 9.25 14.29 13.29 14.47 10.50
- --------------------------------------------------------------------------------------
5 years 105.67 93.83 98.21 96.21 98.10 98.10 100.37 93.42
Annual average 15.51 14.15 14.66 14.43 14.65 14.65 14.91 14.10
- --------------------------------------------------------------------------------------
10 years 239.79 220.25 214.10 214.10 215.23 215.23 222.06 210.79
Annual average 13.01 12.34 12.13 12.13 12.17 12.17 12.41 12.01
- --------------------------------------------------------------------------------------
Annual average
(life of fund) 11.13 10.92 10.09 10.09 10.30 10.30 10.37 10.25
- --------------------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. They do not take into account any
adjustment for taxes payable on reinvested distributions. Investment
returns and principal value will fluctuate so that an investor's shares
when sold may be worth more or less than their original cost. See first
page of the performance summary for method of calculation.
Terms and definitions
Total return shows how the value of the fund's shares changed over time,
assuming you held the shares through the entire period and reinvested all
distributions in the fund.
Class A shares are generally subject to an initial sales charge.
Class B shares may be subject to a sales charge upon redemption.
Class C shares are not subject to an initial sales charge and are subject
to a contingent deferred sales charge only if the shares are redeemed
during the first year.
Class M shares have a lower initial sales charge and a higher 12b-1 fee
than class A shares and no sales charge on redemption.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities, divided by the number of outstanding shares, not including
any initial or contingent deferred sales charge.
Public offering price (POP) is the price of a mutual fund share plus the
maximum sales charge levied at the time of purchase. POP performance
figures shown here assume the 5.75% maximum sales charge for class A
shares and 3.50% for class M shares.
Contingent deferred sales charge (CDSC) is a charge applied at the time of
the redemption of class B or C shares and assumes redemption at the end of
the period. Your funds' class B CDSC declines from a 5% maximum during the
first year to 1% during the sixth year. After the sixth year, the CDSC no
longer applies. The CDSC for class C shares is 1% for one year after
purchase.
Comparative benchmarks
Morgan Stanley Capital International (MSCI) All-Country World Free Index*
is an unmanaged list of global equity securities available to non-domestic
investors, with all values expressed in U.S. dollars.
Consumer price index (CPI) is a commonly used measure of inflation; it
does not represent an investment return.
*Securities indexes assume reinvestment of all distributions and interest
payments and do not take in account brokerage fees or taxes. Securities in
the fund do not match those in the indexes and performance of the fund
will differ. It is not possible to invest directly in an index.
The Putnam family of funds
The following is a complete list of Putnam's open-end mutual funds. Please
call your financial advisor or Putnam at 1-800-225-1581 to obtain a prospectus
for any Putnam fund. It contains more complete information, including charges
and expenses. Please read it carefully before you invest or send money.
GROWTH FUNDS
Asia Pacific Growth Fund
Capital Appreciation Fund [DBL. DAGGER]
Capital Opportunities Fund
Diversified Equity Trust
Europe Growth Fund
Global Growth Fund
Global Natural Resources Fund
Growth Opportunities Fund
Health Sciences Trust
International Growth Fund
International New Opportunities Fund
Investors Fund
New Opportunities Fund [DBL. DAGGER]
OTC & Emerging Growth Fund
Research Fund
Vista Fund
Voyager Fund
Voyager Fund II
GROWTH AND INCOME FUNDS
Balanced Retirement Fund
Convertible Income-Growth Trust
Equity Income Fund
The George Putnam Fund of Boston
Global Growth and Income Fund
The Putnam Fund for Growth and Income
Growth and Income Fund II
International Growth and Income Fund
New Value Fund
Utilities Growth and Income Fund
INCOME FUNDS
American Government Income Fund
Diversified Income Trust
Global Governmental Income Trust
High Quality Bond Fund + [DBL. DAGGER]
High Yield Advantage Fund [DBL. DAGGER]
High Yield Total Return Fund
High Yield Trust [DBL. DAGGER]
High Yield Trust II
Income Fund
Intermediate U.S. Government
Income Fund
Money Market Fund **
Preferred Income Fund
Strategic Income Fund *
U.S. Government Income Trust
TAX-FREE INCOME FUNDS
Municipal Income Fund
Tax Exempt Income Fund
Tax Exempt Money Market Fund**
Tax-Free High Yield Fund
Tax-Free Insured Fund
State tax-free income funds [SECTION MARK]
Arizona, California, Florida, Massachusetts, Michigan, Minnesota, New Jersey,
New York, Ohio and Pennsylvania
State tax-free money market funds [SECTION MARK] **
California, New York
ASSET ALLOCATION FUNDS
Putnam Asset Allocation Funds-three investment portfolios that spread your
money across a variety of stocks, bonds, and money market investments.
The three portfolios:
Asset Allocation: Balanced Portfolio
Asset Allocation: Conservative Portfolio
Asset Allocation: Growth Portfolio
* Formerly Putnam Diversified Income Trust II
+ Formerly Putnam Federal Income Trust
[DBL. DAGGER] Closed to new investors. Some exceptions may apply. Contact
Putnam for details.
[SECTION MARK] Not available in all states.
** An investment in a money market fund is not insured or guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although the funds seek to preserve your investment at $1.00 per share, it
is possible to lose money by investing in the fund.
Check your account balances and current performance at www.putnaminv.com.
A guide to the financial statements
These sections of the report constitute the fund's financial
statements.
The fund's portfolio lists all the fund's investments and their values as of
the last day of the reporting period. Holdings are organized by asset type
and industry sector, country, or state to show areas of concentration and
diversification.
Statement of assets and liabilities shows how the fund's net assets and share
price is determined. All investment and non-investment assets are added
together. Any unpaid expenses and other liabilities are subtracted from this
total. The result is divided by the number of shares to determine the net
asset value per share, which is calculated separately for each class of
shares. (For funds with preferred shares, the amount subtracted from total
assets includes the net assets allocated to remarketed preferred shares.)
Statement of operations shows the fund's net investment gain or loss for the
reporting period. This is determined by adding up all the fund's earnings --
from dividends and interest income -- and subtracting its operating expenses.
This statement also lists any net gain or loss the fund realized on the sales
of its holdings and -- for holdings that remain in the portfolio -- any change
in unrealized gains or losses over the period.
Statement of changes in net assets shows how the fund's net assets were
affected by distributions to shareholders and by changes in the number of the
fund's shares. It lists distributions and their sources (net investment income
or realized capital gains) over the current reporting period and the most
recent fiscal year-end. The distributions listed here may not match the
amounts listed in the Statement of Operations because the distributions are
determined on a tax basis and may be paid in a different period from the one
in which they were earned.
Financial highlights provide an overview of the fund's investment results,
per-share distributions, expense ratios, net investment income ratios and
portfolio turnover in one summary table, reflecting the five most recent
reporting periods. In a semiannual report, the highlight table also includes
the current reporting period. For open-ended funds, a separate table is
provided for each share class.
</TABLE>
<TABLE>
<CAPTION>
The fund's portfolio
April 30, 1999 (Unaudited)
COMMON STOCKS (98.2%) (a)
NUMBER OF SHARES VALUE
<S> <C> <C>
Australia (2.2%)
- --------------------------------------------------------------------------------------------------------------------------
1,846,300 AMP Ltd. $ 21,556,429
8,525,000 Cable & Wireless Optus Ltd. (NON) 19,173,578
8,742,100 Coles Myer Ltd. 46,430,897
2,021,900 Commonwealth Bank of Australia 36,800,951
--------------
123,961,855
Brazil (0.1%)
- --------------------------------------------------------------------------------------------------------------------------
239,100 Telesp Celular Participacoes S.A. ADR (NON) 5,977,500
Canada (1.7%)
- --------------------------------------------------------------------------------------------------------------------------
452,500 Northern Telecom Ltd. 30,718,988
1,249,000 Toronto-Dominion Bank 66,676,713
--------------
97,395,701
Finland (2.3%)
- --------------------------------------------------------------------------------------------------------------------------
1,700,209 Oy Nokia AB Class A 131,224,001
France (6.7%)
- --------------------------------------------------------------------------------------------------------------------------
167,371 Accor S.A. 44,181,090
310,247 Axa S.A. de S.V. (NON) 40,111,090
386,480 Cap Gemini S.A. 59,167,228
104,080 Castorama Dubois 24,941,419
139,281 Elf Aquitaine S.A. 21,661,817
78,901 Sanofi S.A. 12,379,677
448,483 Sidel S.A. 54,092,432
309,095 STMicroelectronics 32,244,419
89,231 Synthelabo 18,267,638
197,442 Societe Television Francaise 1 38,645,323
440,900 Valeo S.A. 37,317,776
--------------
383,009,909
Germany (2.5%)
- --------------------------------------------------------------------------------------------------------------------------
522,200 DaimlerChrysler AG (NON) 51,629,966
14,771 EM TV & Merchandising AG 13,986,808
577,310 Mannesmann AG 76,104,930
--------------
141,721,704
Greece (--%)
- --------------------------------------------------------------------------------------------------------------------------
1,360 National Bank of Greece Rights (NON) 3,960
Hong Kong (0.4%)
- --------------------------------------------------------------------------------------------------------------------------
10,739,000 China Telecom Ltd. 24,526,417
Ireland (1.5%)
- --------------------------------------------------------------------------------------------------------------------------
2,306,899 Allied Irish Banks PLC 37,342,689
1,166,838 CRH PLC 23,023,697
524,300 Elan Corp. PLC ADR (NON) 27,001,450
--------------
87,367,836
Italy (2.3%)
- --------------------------------------------------------------------------------------------------------------------------
2,893,380 Alleanza Assicurazioni SpA 34,744,575
5,154,600 Banca Intesa SpA (NON) 27,485,977
843,200 Banca Popolare di Brescia SpA 29,038,037
2,489,600 Mediaset SpA 21,598,774
2,843,500 Mediolanum SpA 18,802,644
--------------
131,670,007
Japan (10.9%)
- --------------------------------------------------------------------------------------------------------------------------
396,800 Aiful Corp. 32,487,513
1,985 DDI Corp. 9,864,284
5,021,300 Fujitsu Ltd. 86,051,752
24,000 Fujitsu Support and Services, Inc. 144A 2,936,395
426,700 Itoen Ltd. 29,464,569
600,520 KAO Corp. 15,248,262
835,000 Matsushita Communication Industrial Co., Ltd. 59,967,720
609,000 Murata Manufacturing Co., Ltd. 34,856,858
5,789,000 Nikko Securities Co., Ltd. 33,231,071
2,517 NTT Data Corp. 19,932,660
530 NTT Mobile Communications 31,090,245
41,000 Rohm Co. Ltd. 4,947,624
301,000 Secom Co. 29,411,372
170,000 Seven-Eleven Japan Co., Ltd. 14,516,881
57,400 Shohkoh Fund & Co., Ltd. 33,671,322
309,000 Softbank Corp. 41,146,473
1,339,000 Takeda Chemical Industries 58,236,890
468,700 Takefuji Corp. 38,884,846
395,600 Tokyo Electron Ltd. 22,543,193
777,000 Yamanouchi Pharmaceutical Co., Ltd. 24,612,915
--------------
623,102,845
Netherlands (3.0%)
- --------------------------------------------------------------------------------------------------------------------------
789,420 ABN AMRO Holding N.V. 18,833,903
481,920 ASM Lithography Holding N.V. (NON) 20,343,867
684,380 Equant N.V. (NON) 62,197,960
1,352,900 Fortis Amev N.V. 48,237,108
589,300 Koninklijke Ahold N.V. 21,915,301
--------------
171,528,139
Portugal (0.6%)
- --------------------------------------------------------------------------------------------------------------------------
1,186,500 Banco Comercial Portuguese, S.A. 33,504,411
Singapore (0.1%)
- --------------------------------------------------------------------------------------------------------------------------
392,000 Oversea Chinese Banking Corp. 3,678,905
Spain (0.7%)
- --------------------------------------------------------------------------------------------------------------------------
1,058,490 Banco Santander Central Hispano S.A. 23,024,783
711,690 Centros Comerciales Continente S.A. 16,866,484
--------------
39,891,267
Sweden (1.8%)
- --------------------------------------------------------------------------------------------------------------------------
320,248 Hennes & Mauritz AB Class B 27,677,821
1,796,800 Securitas AB 26,700,587
1,102,662 Securitas AB Class B 16,385,643
1,525,100 Skandia Forsakrings AB 29,552,688
--------------
100,316,739
Switzerland (0.8%)
- --------------------------------------------------------------------------------------------------------------------------
13,993 Julius Baer Holdings AG 45,602,393
United Kingdom (13.5%)
- --------------------------------------------------------------------------------------------------------------------------
5,584,400 British Telecommunications PLC ADR (NON) 93,806,528
4,321,000 Cable & Wireless Communications (NON) 49,293,147
693,400 CMG PLC 18,765,748
2,593,400 Compass Group PLC 26,580,612
2,949,200 Dixons Group PLC 62,969,637
147,000 Energis PLC (NON) 3,938,108
904,300 Energis PLC 144A (NON) 24,226,061
1,000,600 Granada Group PLC 21,380,341
3,654,200 Lloyds TSB Group PLC 58,825,476
7,418,196 Misys PLC (NON) 69,645,844
2,819,600 Next PLC 34,796,768
4,177,200 Orange PLC ADR (NON) 56,860,631
1,673,900 Royal Bank Of Scotland Group (NON) 39,483,853
3,576,300 SEMA Group PLC 34,583,143
2,069,006 Smithkline Beecham PLC ADR 27,364,632
16,158,900 Telewest Communications PLC (NON) 74,619,053
3,848,652 Vodafone Group PLC 70,903,908
--------------
768,043,490
United States (47.1%)
- --------------------------------------------------------------------------------------------------------------------------
312,700 AFLAC, Inc. (NON) 16,963,975
234,600 AirTouch Communications, Inc. (NON) 21,905,775
74,600 Allergan, Inc. (NON) 6,704,675
41,100 Amazon.com, Inc. (NON) 7,071,769
383,700 America Online, Inc. (NON) 54,773,175
321,800 American Express Co. (NON) 42,055,238
200,000 American General Corp. (NON) 14,800,000
561,900 American Home Products Corp. (NON) 34,275,900
569,200 American International Group, Inc. 66,845,425
276,400 Amgen, Inc. (NON) 16,981,325
241,800 Apple Computer, Inc. (NON) 11,122,800
281,800 Associates First Capital Corp. 12,487,263
568,592 AT&T Corp. (NON) 36,318,814
93,900 Bausch & Lomb, Inc. (NON) 7,042,500
307,300 Best Buy Co., Inc. (NON) 14,673,575
149,100 Biogen, Inc. (NON) 14,173,819
276,375 Cardinal Health, Inc. 16,530,680
645,500 Carnival Corp. Class A 26,626,875
480,075 Cisco Systems, Inc. (NON) 54,758,555
925,500 Citigroup, Inc. 69,643,875
164,800 Clear Channel Communications, Inc. (NON) 11,453,600
194,600 Clorox Co. 22,451,975
38,200 CMGI, Inc. 9,724,288
167,300 Comcast Corp. Class A 10,989,519
334,600 Comerica, Inc. 21,769,913
327,300 Computer Sciences Corp. (NON) 19,494,806
229,100 Comverse Technology, Inc. (NON) 14,691,038
360,000 Conoco, Inc. 9,765,000
607,300 Costco Companies, Inc. (NON) 49,153,344
572,758 CVS Corp. 27,277,600
420,000 EMC Corp. (NON) 45,753,750
132,700 Enron Corp. 9,985,675
265,900 Estee Lauder Cos. Class A 26,623,238
557,400 Exxon Corp. 46,299,038
165,500 FDX Corp. (NON) 18,629,094
261,800 Fifth Third Bancorp 18,767,788
1,316,820 Firstar Corp. 39,586,901
386,400 Gap, Inc. (The) 25,719,750
880,100 General Electric Co. 92,850,550
327,300 General Instrument Corp. (NON) 11,946,450
250,900 Guidant Corp. 13,470,194
732,800 Home Depot, Inc. (The) 43,922,200
308,400 IBM Corp. 64,513,425
521,900 IMS Health, Inc. 15,657,000
1,205,900 Intel Corp. 73,786,006
427,300 Interpublic Group Cos., Inc. 33,142,456
283,000 Johnson & Johnson 27,592,500
192,700 Kimberly-Clark Corp. 11,814,919
175,300 Kroger Co. (NON) 9,520,981
134,900 Lilly (Eli) & Co. 9,932,013
1,334,700 Lucent Technologies, Inc. 80,248,838
783,700 MCI WorldCom, Inc. (NON) 64,410,344
452,800 MediaOne Group, Inc. (NON) 36,931,500
447,300 Merck & Co., Inc. 31,422,825
294,600 Merrill Lynch & Co., Inc. 24,727,988
1,522,000 Microsoft Corp. (NON) 123,757,625
169,100 Morgan Stanley, Dean Witter, Discover and Co. 16,772,606
323,700 Motorola, Inc. 25,936,463
49,100 Northern Trust Corp. 4,572,438
359,800 Pfizer, Inc. 41,399,488
525,500 Pharmacia & Upjohn, Inc. 29,428,000
385,500 Pitney Bowes, Inc. 26,960,906
125,800 Praxair, Inc. 6,510,150
310,495 Providian Financial Corp. 40,073,261
134,600 QUALCOMM, Inc. (NON) 26,920,000
649,200 Safeway, Inc. (NON) 35,016,225
1,032,800 SBC Communications, Inc. 57,836,800
1,078,300 Schering-Plough Corp. 52,095,369
216,400 Schwab (Charles) Corp. 23,749,900
272,300 Solectron Corp. (NON) 13,206,550
483,700 Sprint Corp. 49,609,481
234,600 Sprint Corp. (PCS Group) 9,941,175
480,000 Sun Microsystems, Inc. (NON) 28,710,000
196,400 Tellabs, Inc. (NON) 21,487,388
941,900 Time Warner, Inc. 65,933,000
1,011,000 TJX Cos., Inc. (The) 33,678,938
245,500 Tricon Global Restaurants, Inc. (NON) 15,804,063
849,600 Tyco International Ltd. 69,030,000
238,200 United Technologies Corp. 34,509,225
960,100 Viacom, Inc. Class B (NON) 39,244,088
1,774,700 Wal-Mart Stores, Inc. 81,636,200
1,029,200 Walgreen Co. 27,659,750
749,200 Warner-Lambert Co. 50,898,775
265,500 Waste Management, Inc. 15,000,750
--------------
2,687,161,133
--------------
Total Common Stocks (cost $4,330,620,667) $5,599,688,212
INVESTMENT COMPANIES (--%) (a) (cost $218,916)
NUMBER OF SHARES VALUE
- --------------------------------------------------------------------------------------------------------------------------
4,054 India Magnum Fund Class A (acquired 3/23/95, cost $218,916)
(India) (NON) (RES) $ 129,728
SHORT-TERM INVESTMENTS (1.0%) (a)
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------------------------------------------------
$50,000,000 Prudential Funding Corp., effective yield of 4.93%,
May 3, 1999 $ 49,979,458
4,437,000 Interest in $292,698,000 joint repurchase agreement dated
April 30, 1999 with Warburg Securities due May 3, 1999
with respect to various U.S. Treasury obligations --
maturity value of $4,438,801 for an effective yield of 4.87% 4,437,000
--------------
Total Short-Term Investments (cost $54,416,458) $ 54,416,458
- --------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $4,385,256,041) (b) $5,654,234,398
- --------------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $5,704,179,345.
(b) The aggregate identified cost on a tax basis is $4,412,428,374, resulting in gross unrealized appreciation and
depreciation of $1,310,528,087 and $68,722,063, respectively, or net unrealized appreciation of $1,241,806,024.
(NON) Non-income-producing security.
(RES) Restricted, excluding 144A securities, as to public resale. The total market value of restricted securities
held at April 30, 1999 was $129,728 or less than 0.01% of net assets.
144A after the name of a security represents those exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified
institutional buyers.
ADR or GDR after the name of a foreign holding stands for American Depository Receipts or Global Depository
Receipts, respectively, representing ownership of foreign securities on deposit with a domestic custodian bank.
The fund had the following industry group concentrations greater than 10% at April 30, 1999 (as a percentage of
net assets):
Insurance and finance 20.4%
Telecommunications 18.6
Retail 10.8
- -------------------------------------------------------------------------------
Forward Currency Contracts to Sell at April 30, 1999 (Unaudited)
(aggregate face value $491,526,612)
Market Aggregate Face Delivery Unrealized
Value Value Date Appreciation
- -------------------------------------------------------------------------------
British Pounds $204,372,114 $204,758,852 6/25/99 $ 386,738
Euro Dollars 276,554,521 286,767,760 6/25/99 10,213,239
- -------------------------------------------------------------------------------
$10,599,977
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of assets and liabilities
April 30, 1999 (Unaudited)
<S> <C>
Assets
- -----------------------------------------------------------------------------------------------
Investments in securities, at value
(identified cost $4,385,256,041) (Note 1) $5,654,234,398
- -----------------------------------------------------------------------------------------------
Cash 18,276
- -----------------------------------------------------------------------------------------------
Foreign currency 568,632
- -----------------------------------------------------------------------------------------------
Dividends and interest receivable 4,461,665
- -----------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 7,773,299
- -----------------------------------------------------------------------------------------------
Receivable for securities sold 233,465,079
- -----------------------------------------------------------------------------------------------
Receivable for open forward currency contracts 10,599,977
- -----------------------------------------------------------------------------------------------
Receivable for closed forward currency contracts 597,719
- -----------------------------------------------------------------------------------------------
Total assets 5,911,719,045
Liabilities
- -----------------------------------------------------------------------------------------------
Payable for securities purchased 187,092,816
- -----------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 8,057,906
- -----------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 8,599,368
- -----------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 1,069,379
- -----------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 35,167
- -----------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 6,220
- -----------------------------------------------------------------------------------------------
Payable for distribution fees (Note 2) 2,432,966
- -----------------------------------------------------------------------------------------------
Payable for closed forward currency contracts 4,118
- -----------------------------------------------------------------------------------------------
Other accrued expenses 241,760
- -----------------------------------------------------------------------------------------------
Total liabilities 207,539,700
- -----------------------------------------------------------------------------------------------
Net assets $5,704,179,345
Represented by
- -----------------------------------------------------------------------------------------------
Paid-in capital (Notes 1 and 4) $4,061,217,681
- -----------------------------------------------------------------------------------------------
Distributions in excess of net investment income (Note 1) (22,226,346)
- -----------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and
foreign currency transactions (Note 1) 385,347,728
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and assets and
liabilities in foreign currencies 1,279,840,282
- -----------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $5,704,179,345
Computation of net asset value and offering price
- -----------------------------------------------------------------------------------------------
Net asset value and redemption price per class A share
($3,518,847,819 divided by 271,319,188 shares) $12.97
- -----------------------------------------------------------------------------------------------
Offering price per class A share (100/94.25 of $12.97)* $13.76
- -----------------------------------------------------------------------------------------------
Net asset value and offering price per class B share
($1,991,317,729 divided by 159,799,969 shares)** $12.46
- -----------------------------------------------------------------------------------------------
Net asset value and redemption price per class C share
($6,243,499 divided by 482,106 shares)** $12.95
- -----------------------------------------------------------------------------------------------
Net asset value and redemption price per class M share
($65,485,630 divided by 5,093,515 shares) $12.86
- -----------------------------------------------------------------------------------------------
Offering price per class M share (100/96.50 of $12.86)* $13.33
- -----------------------------------------------------------------------------------------------
Net asset value, offering price and redemption price per class Y share
($122,284,668 divided by 9,279,002 shares) $13.18
- -----------------------------------------------------------------------------------------------
* On single retail sales of less than $50,000. On sales of $50,000 or more and on group
sales, the offering price is reduced.
** Redemption price per share is equal to net asset value less any applicable contingent
deferred sales charge.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of operations
Six months ended April 30, 1999 (Unaudited)
<S> <C>
Investment income:
- -----------------------------------------------------------------------------------------------
Dividends (net of foreign tax of $796,638) $ 14,021,675
- -----------------------------------------------------------------------------------------------
Interest 432,218
- -----------------------------------------------------------------------------------------------
Total investment income 14,453,893
Expenses:
- -----------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 16,338,187
- -----------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 5,405,493
- -----------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 20,810
- -----------------------------------------------------------------------------------------------
Administrative services (Note 2) 8,906
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class A (Note 2) 4,103,444
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 9,646,628
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class C (Note 2) 6,781
- -----------------------------------------------------------------------------------------------
Distribution fees -- Class M (Note 2) 224,106
- -----------------------------------------------------------------------------------------------
Reports to shareholders 99,767
- -----------------------------------------------------------------------------------------------
Auditing 27,173
- -----------------------------------------------------------------------------------------------
Legal 16,865
- -----------------------------------------------------------------------------------------------
Postage 307,589
- -----------------------------------------------------------------------------------------------
Other 871,418
- -----------------------------------------------------------------------------------------------
Total expenses 37,077,167
- -----------------------------------------------------------------------------------------------
Expense reduction (Note 2) (612,157)
- -----------------------------------------------------------------------------------------------
Net expenses 36,465,010
- -----------------------------------------------------------------------------------------------
Net investment loss (22,011,117)
- -----------------------------------------------------------------------------------------------
Net realized gain on investments (Notes 1 and 3) 409,156,880
- -----------------------------------------------------------------------------------------------
Net realized gain on futures contracts (Note 1) 1,280,686
- -----------------------------------------------------------------------------------------------
Net realized gain on foreign currency transactions (Note 1) 2,887,698
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of assets and liabilities in
foreign currencies during the period 10,957,714
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investments during the period 596,714,225
- -----------------------------------------------------------------------------------------------
Net gain on investments 1,020,997,203
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $ 998,986,086
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of changes in net assets
Six months ended Year ended
April 30 October 31
1999* 1998
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
Increase in net assets
- ---------------------------------------------------------------------------------------------------------------
Operations:
- ---------------------------------------------------------------------------------------------------------------
Net investment loss $ (22,011,117) $ (13,903,582)
- ---------------------------------------------------------------------------------------------------------------
Net realized gain on investments and foreign
currency transactions 413,325,264 154,948,642
- ---------------------------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and
assets and liabilities in foreign currencies 607,671,939 400,487,961
- ---------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 998,986,086 541,533,021
- ---------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income
Class A (12,641,970) (55,521,899)
- ---------------------------------------------------------------------------------------------------------------
Class B -- (24,067,329)
- ---------------------------------------------------------------------------------------------------------------
Class M -- (740,570)
- ---------------------------------------------------------------------------------------------------------------
Class Y (427,765) (1,101,259)
- ---------------------------------------------------------------------------------------------------------------
From net realized gain on investments
Class A (85,069,925) (427,627,489)
- ---------------------------------------------------------------------------------------------------------------
Class B (52,122,170) (279,693,689)
- ---------------------------------------------------------------------------------------------------------------
Class M (1,534,321) (7,129,800)
- ---------------------------------------------------------------------------------------------------------------
Class Y (1,818,004) (7,589,027)
- ---------------------------------------------------------------------------------------------------------------
Increase from capital share transactions (Note 4) 130,602,319 606,332,642
- ---------------------------------------------------------------------------------------------------------------
Total increase in net assets 975,974,250 344,394,601
Net assets
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 4,728,205,095 4,383,810,494
- ---------------------------------------------------------------------------------------------------------------
End of period (including distributions in excess of
net investment income and undistributed net investment
income of $22,226,346 and $12,854,506, respectively) $5,704,179,345 $4,728,205,095
- ---------------------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS A
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share April 30
operating performance (Unaudited) Year ended October 31
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $11.01 $12.00 $11.10 $10.13 $9.92 $9.30
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.03)(b) --(b) .04(b) .09(b) .09 .02
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 2.36 1.23 1.68 1.47 .43 .77
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations 2.33 1.23 1.72 1.56 .52 .79
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income (.05) (.26) (.27) (.18) (.01) --
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (.32) (1.96) (.55) (.41) (.30) (.17)
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.37) (2.22) (.82) (.59) (.31) (.17)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $12.97 $11.01 $12.00 $11.10 $10.13 $9.92
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 21.38* 13.02 16.40 16.10 5.64 8.62
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $3,518,848 $2,882,999 $2,628,933 $2,186,426 $1,689,656 $1,507,550
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .55* 1.18 1.24 1.27 1.28 1.33
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average net assets (%) (.27)* (.01) .31 .84 1.05 .83
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 85.97* 162.35 154.98 72.88 63.31 17.45
- ------------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the basis of the weighted average
number of shares outstanding during the period.
(c) The ratio of expenses to average net assets for the period ended October 31, 1995, and thereafter, includes amounts
paid through brokerage service and expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS B
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share April 30
operating performance (Unaudited) Year ended October 31
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $10.59 $11.62 $10.78 $9.86 $9.74 $9.19
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.08)(b) (.08)(b) (.05)(b) .01(b) .03 .01
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 2.27 1.18 1.64 1.43 .40 .71
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations 2.19 1.10 1.59 1.44 .43 .72
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income -- (.17) (.20) (.11) (.01) --
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (.32) (1.96) (.55) (.41) (.30) (.17)
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.32) (2.13) (.75) (.52) (.31) (.17)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $12.46 $10.59 $11.62 $10.78 $9.86 $9.74
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 20.89* 12.13 15.54 15.25 4.80 7.95
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $1,991,318 $1,732,139 $1,664,215 $1,327,246 $975,794 $801,443
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .93* 1.93 1.99 2.02 2.04 2.11
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average net assets (%) (.65)* (.75) (.45) .09 .29 .12
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 85.97* 162.35 154.98 72.88 63.31 17.45
- ------------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the basis of the weighted average
number of shares outstanding during the period.
(c) The ratio of expenses to average net assets for the period ended October 31, 1995, and thereafter, includes amounts
paid through brokerage service and expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS C
- ------------------------------------------------------------------------------------------------------------------------------------
For the period
February 1, 1999+
Per-share to April 30
operating performance (Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
1999
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Net asset value,
beginning of period $12.97
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.03)(b)
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments .01
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations (.02)
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income --
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions --
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $12.95
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) (0.15)*
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $6,243
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .46*
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment loss
to average net assets (%) (.27)*
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 85.97*
- ------------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the basis of the weighted average
number of shares outstanding during the period.
(c) The ratio of expenses to average net assets for the period ended October 31, 1995, and thereafter, includes amounts
paid through brokerage service and expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS M
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended For the period
Per-share April 30 March 1, 1995+
operating performance (Unaudited) Year ended October 31 to October 31
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $10.90 $11.90 $11.05 $10.09 $8.86
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.06)(b) (.06)(b) (.02)(b) .03(b) .01
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 2.34 1.22 1.66 1.47 1.22
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations 2.28 1.16 1.64 1.50 1.23
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income -- (.20) (.24) (.13) --
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (.32) (1.96) (.55) (.41) --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.32) (2.16) (.79) (.54) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $12.86 $10.90 $11.90 $11.05 $10.09
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 21.13* 12.48 15.72 15.54 13.88*
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $65,486 $50,700 $43,662 $24,179 $5,853
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .80* 1.68 1.74 1.80 1.23*
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average net assets (%) (.52)* (.50) (.21) .32 .17*
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 85.97* 162.35 154.98 72.88 63.31
- ------------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the basis of the weighted average
number of shares outstanding during the period.
(c) The ratio of expenses to average net assets for the period ended October 31, 1995, and thereafter, includes amounts
paid through brokerage service and expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
CLASS Y
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended For the period
Per-share April 30 June 15, 1994+
operating performance (Unaudited) Year ended October 31 to October 31
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $11.20 $12.17 $11.24 $10.25 $10.00 $9.46
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.02)(b) .03(b) .08(b) .12(b) .09 .01
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 2.40 1.25 1.70 1.48 .47 .53
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations 2.38 1.28 1.78 1.60 .56 .54
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income (.08) (.29) (.30) (.20) (.01) --
- ------------------------------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (.32) (1.96) (.55) (.41) (.30) --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.40) (2.25) (.85) (.61) (.31) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $13.18 $11.20 $12.17 $11.24 $10.25 $10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 21.47* 13.35 16.75 16.39 6.00 5.71*
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $122,285 $62,367 $47,000 $66,708 $42,582 $29,396
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .43* .93 .99 1.02 1.06 .37*
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income (loss)
to average net assets (%) (.13)* .24 .69 1.09 1.20 .42*
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 85.97* 162.35 154.98 72.88 63.31 17.45
- ------------------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the basis of the weighted average
number of shares outstanding during the period.
(c) The ratio of expenses to average net assets for the period ended October 31, 1995, and thereafter, includes amounts
paid through brokerage service and expense offset arrangements. Prior period ratios exclude these amounts (Note 2).
</TABLE>
Notes to financial statements
April 30, 1999 (Unaudited)
Note 1
Significant accounting policies
Putnam Global Growth Fund (the "fund") is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The fund seeks capital appreciation by investing
primarily in common stocks traded in securities markets located in a
number of foreign countries and in the United States.
The fund offers class A, class B, class C, class M and class Y shares.
Effective February 1, 1999, the fund began offering class C shares. Class
A shares are sold with a maximum front-end sales charge of 5.75%. Class B
shares, which convert to class A shares after approximately eight years,
do not pay a front-end sales charge but pay a higher ongoing distribution
fee than class A shares, and are subject to a contingent deferred sales
charge, if those shares are redeemed within six years of purchase. Class C
shares are subject to the same fees and expenses as class B shares, except
that class C shares have a one-year 1.00% contingent deferred sales charge
and do not convert to class A shares. Class M shares are sold with a
maximum front end sales charge of 3.50% and pay an ongoing distribution
fee that is higher than class A shares but lower than class B shares.
Class Y shares, which are sold at net asset value, are generally subject
to the same expenses as class A, class B, class C and class M shares, but
do not bear a distribution fee. Class Y shares are sold to defined
contribution plans that invest at least $150 million in a combination of
Putnam funds and other accounts managed by affiliates of Putnam Investment
Management, Inc., ("Putnam Management"), the fund's manager, a
wholly-owned subsidiary of Putnam Investments, Inc.
Expenses of the fund are borne pro-rata by the holders of each class of
shares, except that each class bears expenses unique to that class
(including the distribution fees applicable to such class). Each class
votes as a class only with respect to its own distribution plan or other
matters on which a class vote is required by law or determined by the
Trustees. Shares of each class would receive their pro-rata share of the
net assets of the fund, if that fund were liquidated. In addition, the
Trustees declare separate dividends on each class of shares.
The following is a summary of significant accounting policies consistently
followed by the fund in the preparation of its financial statements. The
preparation of financial statements is in conformity with generally
accepted accounting principles and requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities. Actual results could differ from those estimates.
A) Security valuation Investments for which market quotations are readily
available are stated at market value, which is determined using the last
reported sale price, or, if no sales are reported -- as in the case of
some securities traded over-the-counter -- the last reported bid price.
Securities quoted in foreign currencies are translated into U.S. dollars
at the current exchange rate. Short-term investments having remaining
maturities of 60 days or less are stated at amortized cost which
approximates market, and other investments are stated at fair value
following procedures approved by the Trustees.
B) Joint trading account Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the fund may transfer uninvested cash
balances into a joint trading account along with the cash of other
registered investment companies and certain other accounts managed by
Putnam Management. These balances may be invested in one or more
repurchase agreements and/or short-term money market instruments.
C) Repurchase agreements The fund, or any joint trading account, through
its custodian, receives delivery of the underlying securities, the market
value of which at the time of purchase is required to be in an amount at
least equal to the resale price, including accrued interest. Collateral
for certain tri-party repurchase agreements is held at the counterparty's
custodian in a segregated account for the benefit of the fund and the
counterparty. Putnam Management is responsible for determining that the
value of these underlying securities is at all times at least equal to the
resale price, including accrued interest.
D) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed). Interest income is recorded on the accrual basis.
Dividend income is recorded on the ex-dividend date except that certain
dividends from foreign securities are recorded as soon as the fund is
informed of the ex-dividend date.
E) Foreign currency translation The accounting records of the fund are
maintained in U.S. dollars. The market value of foreign securities,
currency holdings, and other assets and liabilities are recorded in the
books and records of the fund after translation to U.S. dollars based on
the exchange rates on that day. The cost of each security is determined
using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when accrued or incurred. The fund
does not isolate that portion of realized or unrealized gains or losses
resulting from changes in the foreign exchange rate on investments from
fluctuations arising from changes in the market prices of the securities.
Such gains and losses are included with the net realized and unrealized
gain or loss on investments. Net realized gains and losses on foreign
currency transactions represent net realized exchange gains or losses on
closed forward currency contracts, disposition of foreign currencies and
the difference between the amount of investment income and foreign
withholding taxes recorded on the fund's books and the U.S. dollar
equivalent amounts actually received or paid. Net unrealized appreciation
and depreciation of assets and liabilities in foreign currencies arise
from changes in the value of open forward currency contracts and assets
and liabilities other than investments at the period end, resulting from
changes in the exchange rate.
F) Forward currency contracts The fund may engage in forward currency
contracts, which are agreements between two parties to buy and sell
currencies at a set price on a future date, to protect against a decline
in value relative to the U.S. dollar of the currencies in which its
portfolio securities are denominated or quoted (or an increase in the
value of a currency in which securities a fund intends to buy are
denominated, when a fund holds cash reserves and short-term investments).
The U.S. dollar value of forward currency contracts is determined using
current forward currency exchange rates supplied by a quotation service.
The market value of the contract will fluctuate with changes in currency
exchange rates. The contract is "marked to market" daily and the change in
market value is recorded as an unrealized gain or loss. When the contract
is closed, the fund records a realized gain or loss equal to the
difference between the value of the contract at the time it was opened and
the value at the time it was closed. The fund could be exposed to risk if
the value of the currency changes unfavorably, if the counterparties to
the contracts are unable to meet the terms of their contracts or if the
fund is unable to enter into a closing position.
G) Futures and options contracts The fund may use futures and options
contracts to hedge against changes in the values of securities the fund
owns or expects to purchase. The fund may also write options on securities
it owns or in which it may invest to increase its current returns.
The potential risk to the fund is that the change in value of futures and
options contracts may not correspond to the change in value of the hedged
instruments. In addition, losses may arise from changes in the value of
the underlying instruments, if there is an illiquid secondary market for
the contracts, or if the counterparty to the contract is unable to
perform. When the contract is closed, the fund records a realized gain or
loss equal to the difference between the value of the contract at the time
it was opened and the value at the time it was closed. Realized gains and
losses on purchased options are included in realized gains and losses on
investment securities.
Futures contracts are valued at the quoted daily settlement prices
established by the exchange on which they trade. Exchange traded options
are valued at the last sale price, or if no sales are reported, the last
bid price for purchased options and the last ask price for written
options. Options traded over-the-counter are valued using prices supplied
by dealers.
H) Line of credit The fund has entered into a committed line of credit
with certain banks. This line of credit agreement includes restrictions
that the fund maintains an asset coverage ratio of at least 300% and
borrowings must not exceed prospectus limitations. For the six months
ended April 30, 1999, the fund had no borrowings against the line of
credit.
I) Federal taxes It is the policy of the fund to distribute all of its
taxable income within the prescribed time and otherwise comply with the
provisions of the Internal Revenue Code applicable to regulated investment
companies. It is also the intention of the fund to distribute an amount
sufficient to avoid imposition of any excise tax under Section 4982 of the
Internal Revenue Code of 1986, as amended. Therefore, no provision has
been made for federal taxes on income, capital gains or unrealized
appreciation on securities held nor for excise tax on income and capital
gains.
J) Distributions to shareholders Distributions to shareholders from net
investment income are recorded by the fund on the ex-dividend date.
Capital gain distributions, if any, are recorded on the ex-dividend date
and paid at least annually. The amount and character of income and gains
to be distributed are determined in accordance with income tax regulations
which may differ from generally accepted accounting principles.
Reclassifications are made to the fund's capital accounts to reflect
income and gains available for distribution (or available capital loss
carryovers) under income tax regulations.
Note 2
Management fee, administrative
services, and other transactions
Compensation of Putnam Management, for management and investment advisory
services is paid quarterly based on the average net assets of the fund.
Such fee is based on the following annual rates: 0.80% of the first $500
million of average net assets, 0.70% of the next $500 million, 0.65% of
the next $500 million, 0.60% of the next $5 billion, 0.575% of the next $5
billion, 0.555% of the next $5 billion, 0.54% of the next $5 billion and
0.53% thereafter.
The fund reimburses Putnam Management an allocated amount for the
compensation and related expenses of certain officers of the fund and
their staff who provide administrative services to the fund. The aggregate
amount of all such reimbursements is determined annually by the Trustees.
Custodial functions for the fund's assets are provided by Putnam Fiduciary
Trust Company (PFTC), a subsidiary of Putnam Investments, Inc. Investor
servicing agent functions are provided by Putnam Investor Services, a
division of PFTC.
For the six months ended April 30, 1999, fund expenses were reduced by
$612,157 under expense offset arrangements with PFTC and brokerage service
arrangements. Investor servicing and custodian fees reported in the
Statement of operations exclude these credits. The fund could have
invested a portion of the assets utilized in connection with the expense
offset arrangements in an income producing asset if it had not entered
into such arrangements.
Each Trustee of the fund receives an annual Trustee fee, of which $3,920
has been allocated to the fund, and an additional fee for each Trustee's
meeting attended. Trustees who are not interested persons of Putnam
Management and who serve on committees of the Trustees receive additional
fees for attendance at certain committee meetings.
The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan")
which allows the Trustees to defer the receipt of all or a portion of the
Trustees Fees payable on or after July 1, 1995. The deferred fees remain
in the fund and are invested in certain Putnam funds until distribution in
accordance with the Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension
plan (the "Pension Plan") covering all Trustees of the fund who have
served as Trustee for at least five years. Benefits under the Pension Plan
are equal to 50% of the Trustee's average total retainer and meeting fees
for the three years preceding retirement. Pension expense for the fund is
included in Compensation of Trustees in the Statement of operations.
Accrued pension liability is included in Payable for compensation of
Trustees in the Statement of assets and liabilities.
The fund has adopted distribution plans (the "Plans") with respect to its
class A, class B, class C and class M shares pursuant to Rule 12b-1 under
the Investment Company Act of 1940. The purpose of the Plans is to
compensate Putnam Mutual Funds Corp., a wholly-owned subsidiary of Putnam
Investments Inc., for services provided and expenses incurred by it in
distributing shares of the fund. The Plans provide for payments by the
fund to Putnam Mutual Funds Corp. at an annual rate up to 0.35%, 1.00%,
1.00% and 1.00% of the average net assets attributable to class A, class
B, class C and class M shares, respectively. The Trustees have approved
payment by the fund at an annual rate of 0.25%, 1.00%, 1.00% and 0.75% of
the average net assets attributable to class A, class B, class C and class
M shares respectively.
For the six months ended April 30, 1999, Putnam Mutual Funds Corp., acting
as underwriter received net commissions of $320,127 and $13,185 from the
sale of class A and class M shares, respectively, and received $1,110,736
and $4,139 in contingent deferred sales charges from redemptions of class
B and C shares. A deferred sales charge of up to 1% is assessed on certain
redemptions of class A shares. For the six months ended April 30, 1999,
Putnam Mutual Funds Corp., acting as underwriter received $3,944 on class
A redemptions.
Note 3
Purchases and sales of securities
During the six months ended April 30, 1999, purchases and sales of
investment securities other than short-term investments aggregated
$4,615,178,261 and $4,555,258,254, respectively. There were no purchases
and sales of U.S. government obligations. In determining the net gain or
loss on securities sold, the cost of securities has been determined on the
identified cost basis.
Note 4
Capital shares
At April 30, 1999, there was an unlimited number of shares of beneficial
interest authorized. Transactions in capital shares were as follows:
Six months ended April 30, 1999
- -----------------------------------------------------------------------------
Class A Shares Amount
- -----------------------------------------------------------------------------
Shares sold 40,018,787 $499,372,561
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 7,628,991 93,150,726
- -----------------------------------------------------------------------------
47,647,778 592,523,287
Shares
repurchased (38,082,769) (474,776,369)
- -----------------------------------------------------------------------------
Net increase 9,565,009 $117,746,918
- -----------------------------------------------------------------------------
Year ended October 31, 1998
- -----------------------------------------------------------------------------
Class A Shares Amount
- -----------------------------------------------------------------------------
Shares sold 67,632,824 $765,441,417
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 48,094,524 460,264,719
- -----------------------------------------------------------------------------
115,727,348 1,225,706,136
Shares
repurchased (72,999,084) (818,734,753)
- -----------------------------------------------------------------------------
Net increase 42,728,264 $406,971,383
- -----------------------------------------------------------------------------
Six months ended April 30, 1999
- -----------------------------------------------------------------------------
Class B Shares Amount
- -----------------------------------------------------------------------------
Shares sold 18,290,663 $218,492,327
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 4,156,959 48,885,840
- -----------------------------------------------------------------------------
22,447,622 267,378,167
Shares
repurchased (26,198,240) (313,356,369)
- -----------------------------------------------------------------------------
Net decrease (3,750,618) $(45,978,202)
- -----------------------------------------------------------------------------
Year ended October 31, 1998
- -----------------------------------------------------------------------------
Class B Shares Amount
- -----------------------------------------------------------------------------
Shares sold 32,103,540 $347,176,136
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 30,698,837 284,271,233
- -----------------------------------------------------------------------------
62,802,377 631,447,369
Shares
repurchased (42,493,698) (459,737,498)
- -----------------------------------------------------------------------------
Net increase 20,308,679 $171,709,871
- -----------------------------------------------------------------------------
For the period February 1, 1999
(commencement of operations)
to April 30, 1999
- -----------------------------------------------------------------------------
Class C Shares Amount
- -----------------------------------------------------------------------------
Shares sold 516,968 $ 6,622,137
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions --- ---
- -----------------------------------------------------------------------------
516,968 6,622,137
Shares
repurchased (34,862) (455,088)
- -----------------------------------------------------------------------------
Net increase 482,106 $ 6,167,049
- -----------------------------------------------------------------------------
Six months ended April 30, 1999
- -----------------------------------------------------------------------------
Class M Shares Amount
- -----------------------------------------------------------------------------
Shares sold 2,224,573 $ 27,466,919
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 121,972 1,478,299
- -----------------------------------------------------------------------------
2,346,545 28,945,218
Shares
repurchased (1,902,718) (23,491,789)
- -----------------------------------------------------------------------------
Net increase 443,827 $ 5,453,429
- -----------------------------------------------------------------------------
Year ended October 31, 1998
- -----------------------------------------------------------------------------
Class M Shares Amount
- -----------------------------------------------------------------------------
Shares sold 2,198,969 $24,442,916
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 789,181 7,505,074
- -----------------------------------------------------------------------------
2,988,150 31,947,990
Shares
repurchased (2,006,965) (22,548,855)
- -----------------------------------------------------------------------------
Net increase 981,185 $ 9,399,135
- -----------------------------------------------------------------------------
Six months ended April 30, 1999
- -----------------------------------------------------------------------------
Class Y Shares Amount
- -----------------------------------------------------------------------------
Shares sold 4,695,672 $59,749,584
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 181,278 2,245,769
- -----------------------------------------------------------------------------
4,876,950 61,995,353
Shares
repurchased (1,168,124) (14,782,228)
- -----------------------------------------------------------------------------
Net increase 3,708,826 $47,213,125
- -----------------------------------------------------------------------------
Year ended October 31, 1998
- -----------------------------------------------------------------------------
Class Y Shares Amount
- -----------------------------------------------------------------------------
Shares sold 2,546,489 $29,156,167
- -----------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 895,004 8,690,286
- -----------------------------------------------------------------------------
3,441,493 37,846,453
Shares
repurchased (1,733,001) (19,594,200)
- -----------------------------------------------------------------------------
Net increase 1,708,492 $18,252,253
- -----------------------------------------------------------------------------
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WEB SITE
www.putnaminv.com
INVESTMENT MANAGER
Putnam Investment
Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
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LEGAL COUNSEL
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TRUSTEES
George Putnam, Chairman
William F. Pounds, Vice Chairman
John A. Hill, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
Lawrence J. Lasser
John H. Mullin III
Robert E. Patterson
Donald S. Perkins
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
John D. Hughes
Senior Vice President and Treasurer
Lawrence J. Lasser
Vice President
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Vice President
Ian C. Ferguson
Vice President
Brett C. Browchuk
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Kelly A. Morgan
Vice President and Fund Manager
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Vice President and Fund Manager
Michael Arends
Vice President and Fund Manager
Manuel Weiss Herrero
Vice President and Fund Manager
David Santos
Vice President and Fund Manager
Richard A. Monaghan
Vice President
John R. Verani
Vice President
Beverly Marcus
Clerk and Assistant Treasurer
This report is for the information of shareholders of Putnam Utilities
Growth and Income Fund. It may also be used as sales literature when
preceded or accompanied by the current prospectus, which gives details of
sales charges, investment objectives, and operating policies of the fund,
and the most recent copy of Putnam's Quarterly Performance Summary. For
more information or to request a prospectus, call toll free: 1-800-225-1581.
You can also learn more at Putnam Investments' Web site: www.putnaminv.com.
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invested.
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SA006-52493 005/882/907/513 6/99
PUTNAM INVESTMENTS [SCALE LOGO OMITTED]
- ----------------------------------------------------------------------------
Putnam Global Growth Fund
Supplement to Semiannual Report dated 4/30/99
The following information has been prepared to provide class Y shareholders
with a performance overview specific to their holdings. Class Y shares are
offered exclusively to defined contribution plans investing $250 million or
more in one or more of Putnam?s funds or private accounts. Performance of
class Y shares, which incur neither a front-end load, distribution fee, nor
contingent deferred sales charge, will differ from performance of class A,
B, and M shares, which are discussed more extensively in the semiannual
report.
ANNUAL RESULTS AT A GLANCE
- ----------------------------------------------------------------------------
Total return: NAV
Six months ended 4/30/99 21.47%
One year ended 4/30/99 14.61
Five years ended 4/30/99 107.86
Annual average 15.76
Ten years ended 4/30/99 238.19
Annual average 12.96
Life of class (since 9/1/67) 2796.35
Annual average 11.22
- ----------------------------------------------------------------------------
Share value: NAV
4/30/98 $11.20
4/30/99 13.18
- ----------------------------------------------------------------------------
Distributions: No. Income Capital gains Total
1 $0.076 $0.323 $0.399
- ----------------------------------------------------------------------------
Please note that past performance does not indicate future results.
Investment return and principal value will fluctuate so your shares, when
redeemed, may be worth more or less than their original cost. See full
report for information on comparative benchmarks. If you have questions,
please consult your fund prospectus or call Putnam toll free at
1-800-752-9894.
