Letter to shareholders
William V. Fries, CFA
Portfolio Manager
November 6, 2000
Dear Fellow Shareholder:
I am pleased to report Thornburg Global Value Fund's results for the fiscal year
ended September 30, 2000. Shown in the table below are total returns for the
calendar year-to-date, fiscal year and since inception. Total returns are for
investors who held shares for the entire periods shown, with dividends
reinvested in additional shares.
<TABLE>
<CAPTION>
Total return performance as of 9.30.00
A Shares B SHARES C Shares
YTD One Year Since Incept. YTD One Year Since Incept. YTD One Year Since Incept.
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value ... (0.23)% 34.42% 18.14%* (3.73)% n/a (3.73)%* (.77)% 33.20% 17.03%*
Max. Offering Price (4.69)% 28.37% 15.85%* (6.36)% n/a (8.54)%* (1.76)% 33.20% 17.03%*
<FN>
* Annualized Past performance cannot guarantee future results INCEPTION: 5/28/98
</FN>
</TABLE>
The impressive 34% return recorded in the 12 months ended September 30, 2000 was
mostly the result of exceptional returns in the first half of the fiscal year.
Weak markets since have produced a slight negative return for the calendar year
to date. Investor sentiment is reflecting growing concern that economies around
the world will be impacted by rising energy costs, slackening demand from the U.
S., and rising interest rates in Europe. While some of our profit taking in a
few highly appreciated issues (Softbank, Sony, and Samsung) was fortuitous,
remaining technology, telecommunications and credit sensitive issues have
declined with weak markets.
The current sell off is likely creating attractive opportunities for the long
run. Nonetheless, we have been cautious about adding to positions or
establishing new positions in affected sectors. Recent investments have been
more focused on issues where earnings progress is more a question of magnitude
than direction. Included among recent portfolio additions are: Fresenius AG, a
German and world leader in kidney dialysis and blood treatment products and
service; Cadbury Schweppes, leading UK beverage and confections company and
Barclays Plc, a provider of financial services in the UK and around the world.
You can learn more about these companies and all of our holdings by visiting our
website at www.Thornburg.com. Links to company websites where available are also
provided.
The tables on the following page provide a summary of geographic and industry
diversification compared with last year. Increased holdings in the UK and
initial investments in China are notable. U.S holdings are primarily in global
businesses. Total holdings in less developed nations at fiscal year and amounted
to 18% of the portfolio. We are mindful of the higher risks associated with
these investments. Valuations of these unique holdings are compelling, however,
and each stock we hold in these markets has a leadership position in a promising
business.
Industry exposures have changed since last year. Technology and
telecommunications equipment and service are materially lower while healthcare
and other consumer stables are higher, largely reflecting the additions
mentioned above. The portfolio's 5 largest sectors included 24 stocks and
accounted for 53% of portfolio value. Immediately following is a chart that
illustrates the industry sector changes between September 30, 1999 and September
30, 2000.
TOP INDUSTRY SECTOR
2000 1999
13.2% Healthcare Services ....... 12.7% Telecommunications Equipment & Svc
9.6% Banking ................... 12.5% Investment Management & Brokerage
9.6% Investment Management & Brokerage 12.1% Technology
8.4% Telecommunications Equipment & Svc 9.8% Banking
7.4% Technology ................ 6.3% Healthcare
On September 30 an income distribution of $0.37 on Class A shares, $0.36 on
Class B shares and $ 0.33 on Class C shares was made to shareholder of record as
of September 30. The income distribution was larger than normal reflecting mark
to market currency gains and the distribution of Nortel Networks shares from BCE
Corp. This distribution is treated as regular income for U.S. investors. The
income from currency is the result of normal currency hedging. No capital gain
distribution was made for the year. While our top priority and investment
objective is capital appreciation, we continue to be conscious of the impact of
portfolio activity on taxable investors.
Holdings by Country*
9.30 9.30
2000 1999
UK .......... 13.7% 8.9%
Germany ..... 11.4% 14.1%
United States 10.1% 9.2%
Switzerland . 8.8% 5.7%
Japan ....... 6.8% 8.8%
Netherlands . 6.2% 8.0%
Finland ..... 4.0% 3.0%
China ....... 4.0% 0.0%
Brazil ...... 3.7% 2.6%
Spain ....... 3.0% 0.8%
Taiwan ...... 2.8% 1.9%
Austria ..... 2.4% 3.6%
India ....... 2.0% 0.0%
Sweden ...... 1.9% 1.8%
Bermuda ..... 1.9% 2.3%
Poland ...... 1.9% 1.4%
Hungary ..... 1.8% 0.0%
Hong Kong ... 1.2% 0.0%
Korea ....... 1.2% 3.2%
Canada ...... 0.0% 5.6%
Australia ... 0.0% 2.0%
Ireland ..... 0.0% 1.9%
Greece ...... 0.0% 1.8%
Italy ....... 0.0% 2.2%
The investment philosophy and process of the Thornburg Global Value Fund is the
same as Thornburg Value Fund, except internationally focused. Our practice of
managing a concentrated, portfolio of value priced stocks in what we identify as
Basic Value, Consistent Growers and Emerging Franchise Categories, is intended
to foster the opportunity for good performance in varying market environments.
If we execute the strategy well, I am confident we can perform well compared
with appropriate benchmarks.
Thank you for investing in the Thornburg Global Value Fund.
Sincerely,
William V. Fries, CFA
Portfolio Manager
Statement of assets and liabilities
Thornburg Global Value Fund
September 30, 2000
ASSETS
Investments at value (cost $98,360,677) ...................... $ 102,489,761
Cash ......................................................... 581,780
Cash denominated in foreign currencies (cost $3,249,185) ..... 3,274,448
Receivable for securities sold ............................... 1,428,220
Receivable for fund shares sold .............................. 1,664,491
Unrealized gain on forward exchange contracts (Note 6) ....... 2,425,946
Dividends receivable ......................................... 137,103
Prepaid expenses and other assets ............................ 21,807
Total Assets ............................... 112,023,556
LIABILITIES
Payable for securities purchased ............................. 7,806,625
Payable for fund shares redeemed ............................. 515,625
Payable to investment advisor (Note 3) ....................... 61,979
Accounts payable and accrued expenses ........................ 178,731
Total Liabilities .......................... 8,562,960
NET ASSETS ................................................... $ 103,460,596
NET ASSETS CONSIST OF:
Undistributed net investment income$ ................ 1,506,720
Net unrealized appreciation (depreciation) on investments 6,570,980
Accumulated net realized (loss) ..................... (563,007)
Net capital paid in on shares of beneficial interest .. 95,945,903
$ 103,460,596
NET ASSET VALUE:
Class A Shares:
Net asset value and redemption price per share
($76,069,994 applicable to 4,570,403 shares of beneficial
interest outstanding - Note 4) $ 16.64
Maximum sales charge, 4.50% of offering
price (4.70% of net asset value per share) 0.78
Maximum Offering Price Per Share $ 17.42
Class B Shares:
Net asset value and offering price per share*
($1,270,153 applicable to 77,238 shares of beneficial
interest outstanding - Note 4) $ 16.44
Class C Shares:
Net asset value and offering price per share*
($26,120,449 applicable to 1,584,258 shares of beneficial
interest outstanding - Note 4) $ 16.49
*Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See notes to financial statements.
Statement of operations
INVESTMENT INCOME
Dividend income (net of foreign taxes withheld of $133,868) $ 2,577,568
Interest income 293,977
Total Income 2,871,545
EXPENSES
Investment advisory fees (Note 3) ................................... 592,028
Administration fees (Note 3)
Class A Shares ............................................. 66,064
Class B Shares ............................................. 470
Class C Shares ............................................. 18,041
Distribution and service fees (Note 3)
Class A Shares ............................................. 132,129
Class B Shares ............................................. 3,759
Class C Shares ............................................. 144,330
Transfer agent fees ................................................. 74,398
Registration & filing fees .......................................... 35,132
Custodian fees ...................................................... 89,196
Professional fees ................................................... 15,654
Accounting fees ..................................................... 7,196
Director fees ....................................................... 1,074
Other expenses ...................................................... 11,985
Total Expenses .................................... 1,191,456
Less:
Expenses reimbursed by investment advisor (Note 3) ......... (32,166)
Net Expenses ...................................... 1,159,290
Net Investment Income ............................. 1,712,255
REALIZED AND UNREALIZED GAIN (LOSS) - NOTE 5 Net realized gain (loss) on:
Investments ................................................ (361,095)
Foreign currency transactions .............................. 3,219,278
2,858,183
Net unrealized appreciation (depreciation)
Investments ................................................ 2,168,282
Foreign currency translation ............................... 2,750,739
4,919,021
Net Realized and Unrealized
Gain on Investments ........................................ 7,777,204
Net Increase in Net Assets Resulting
From Operations ...........................................$ 9,489,459
See notes to financial statements.
Statement of changes in net assets
Year Ended Year Ended
September 30, 2000 September 30, 1999
INCREASE (DECREASE) IN
NET ASSETS FROM:
OPERATIONS:
Net investment income ......................... $ 1,712,255 $ 138,170
Net realized gain on investments
and foreign currency transactions ............. 2,858,183 526,485
Increase in unrealized appreciation
on investments and foreign currency translation 4,919,021 3,017,586
Net Increase in Net Assets
Resulting from Operations ... 9,489,459 3,682,241
DIVIDENDS TO SHAREHOLDERS:
From net investment income
Class A Shares ....................... (2,957,271) (160,511)
Class B Shares ....................... (34,855) --
Class C Shares ....................... (799,585) (11,023)
FUND SHARE TRANSACTIONS - (Note 4)
Class A Shares ....................... 47,229,032 12,617,589
Class B Shares ....................... 1,333,025 --
Class C Shares ....................... 22,763,764 2,291,828
Net Increase in Net Assets .. 77,023,569 18,420,124
NET ASSETS:
Beginning of year .................... 26,437,027 8,016,903
End of year .......................... $ 103,460,596 $ 26,437,027
See notes to financial statements.
Notes to financial statements
Note 1 - Organization
Thornburg Global Value Fund, hereinafter referred to as the "Fund," is a
diversified series of Thornburg Investment Trust (the "Trust"). The Trust was
organized as a Massachusetts business trust under a Declaration of Trust dated
June 3, 1987 and is registered as a diversified, open-end management investment
company under the Investment Company Act of 1940, as amended. The Trust is
currently issuing seven series of shares of beneficial interest in addition to
those of the Fund: Thornburg Limited Term U.S. Government Fund, Thornburg New
Mexico Intermediate Municipal Fund, Thornburg Intermediate Municipal Fund,
Thornburg Limited Term Income Fund, Thornburg Florida Intermediate Municipal
Fund, Thornburg Value Fund and Thornburg New York Intermediate Municipal Fund.
Each series is considered to be a separate entity for financial reporting and
tax purposes and bears expenses directly attributable to it. Expenses which are
attributable to all series of the Trust are allocated to each series based on
their relative net assets. The Fund seeks long-term capital appreciation by
investing in both foreign and domestic equity securities selected on a value
basis. The Fund currently offers three classes of shares of beneficial interest,
Class A, Class B and Class C shares. Each class of shares of a Fund represents
an interest in the same portfolio of investments of the Fund, except that (i)
Class A shares are sold subject to a front-end sales charge collected at the
time the shares are purchased and bear a service fee, (ii) Class B shares are
sold at net asset value without a sales charge at the time of purchase, but are
subject to a contingent deferred sales charge upon redemption, and bear both a
service fee and distribution fee, (iii) Class C shares are sold at net asset
value without a sales charge at the time of purchase, but are subject to a
contingent deferred sales charge upon redemption within one year, and bear both
a service fee and a distribution fee, and (iv) the respective classes have
different reinvestment privileges. Additionally, the Fund may allocate among its
classes certain expenses, to the extent allowable to specific classes, including
transfer agent fees, government registration fees, certain printing and postage
costs, and administrative and legal expenses. Currently, class specific expenses
of the Fund are limited to distribution fees, administration fees and certain
transfer agent expenses. Class B shares of the Fund outstanding for eight years
will convert to Class A shares of the Fund.
Note 2 - Significant Accounting Policies Significant accounting policies of the
Funds are as follows:
Valuation of Securities: In determining net asset value, investments are stated
at value based on latest sales at 4:00 pm est prices reported on national
securities exchanges on the last business day of the period. Investments for
which no sale is reported are valued at the mean between bid and asked prices.
Securities for which market quotations are not readily available are valued at
fair value as determined by management and approved in good faith by the Board
of Trustees. Short term obligations having remaining maturities of 60 days or
less are valued at amortized cost which approximates market value.
Foreign Currency Translation: Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollars
based on the exchange rate of such currencies against the U.S. dollar on the
date of valuation. Purchases and sales of securities and income items
denominated in foreign currencies are translated into U.S. dollars at the
exchange rate in effect on the translation date. When the Fund purchases or
sells foreign securities it will customarily enter into a foreign exchange
contract to minimize foreign exchange risk from the trade date to the settlement
date of such transactions. The Fund does not separately report the effect of
changes in foreign exchange rates from changes in market prices on securities
held. Such changes are included in net realized and unrealized gain or loss from
investments.
Federal Income Taxes: It is the policy of the Fund to comply with the provisions
of the Internal Revenue Code applicable to "regulated investment companies" and
to distribute all of its taxable income to its shareholders. Therefore, no
provision for Federal income tax is required. Net realized capital losses are
carried forward to offset realized capital gains in future years. To the extent
such carryforwards are used, no capital gain distributions will be made.
When-Issued and Delayed Delivery Transactions: The Fund may engage in
when-issued or delayed delivery transactions. To the extent the Fund engages in
such transactions, it will do so for the purpose of acquiring portfolio
securities consistent with its investment objectives and not for the purpose of
investment leverage or to speculate on market changes. At the time the Fund
makes a commitment to purchase a security on a when-issued basis, it will record
the transaction and reflect the value in determining its net asset value. When
effecting such transactions, assets of the Fund of an amount sufficient to make
payment for the portfolio securities to be purchased will be segregated on the
Fund's records on the trade date.
Dividends: Dividends to the shareholders are paid quarterly and are reinvested
in additional shares of the Fund at net asset value per share at the close of
business on the dividend payment date, or at the shareholder's option, paid in
cash. Net realized capital gains, to the extent available, will be distributed
annually. Distributions to shareholders are based on income tax regulations and
therefore, their characteristics may differ for financial statement and tax
purposes.
General: Securities transactions are accounted for on a trade date basis.
Interest income is accrued as earned and dividend income is recorded on the
ex-dividend date. Use of Estimates: The preparation of financial statements, in
conformity with generally accepted accounting principles, requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of increases and decreases
in net assets from operations during the reporting period. Actual results could
differ from those estimates.
Note 3 - Investment Advisory Fee And Other Transactions With Affiliates
Pursuant to an investment advisory agreement, Thornburg Investment Management,
Inc. (the "Adviser") serves as the investment adviser and performs services to
the Fund for which the fees are payable at the end of each month. For the year
ended September 30, 2000, these fees were payable at annual rates ranging from
7/8 of 1% to 27/40 of 1% of the average daily net assets of the Fund depending
on the Fund's asset size. The Fund also has an Administrative Services Agreement
with the Adviser, whereby the Adviser will perform certain administrative
services for the shareholders of each class of the Fund's shares, and for which
fees will be payable at an annual rate of up to 1/8 of 1% of the average daily
net assets attributable to each class of shares. For the year ended September
30, 2000, the Adviser voluntarily reimbursed certain class specific transfer
agent fees of $8,818 for Class A, $13,883 for Class B, and $9,465 for Class C,
respectively..
The Fund has an underwriting agreement with Thornburg Securities Corporation
(the "Distributor"), which acts as the Distributor of the Fund's shares. For the
year ended September 30, 2000, the Distributor earned net commissions
aggregating $69,109 from the sale of Class A shares of the Fund, and collected
contingent deferred sales charges aggregating $3,371 from redemptions of Class C
shares of the Fund.
Pursuant to a Service Plan under Rule 12b-1 of the Investment Company Act of
1940, the Fund may reimburse to the Adviser an amount not to exceed 1/4 of 1%
per annum of its average net assets attributable to each class of shares of the
Fund for payments made by the Adviser to securities dealers and other financial
institutions to obtain various shareholder related services. The Adviser may pay
out of its own funds additional expenses for distribution of the Fund's shares.
The Fund has also adopted Distribution Plans pursuant to Rule 12b-1, applicable
only to the Fund's Class B and C shares under which the Fund compensates the
Distributor for services in promoting the sale of Class B and C shares of the
Fund at an annual rate of up to 1% of the average daily net assets attributable
to these classes of shares. Total fees incurred by each class of shares of the
Fund under their respective Service and Distribution Plans for the year ended
September 30, 2000 are set forth in the statement of operations.
Certain officers and trustees of the Trust are also officers and/or directors of
the Adviser and Distributor. The compensation of unaffiliated trustees is borne
by the Trust.
Notes to financial statements . . . continued
Note 4 - Shares of Beneficial Interest
At September 30, 2000 there were an unlimited number of shares of beneficial
interest authorized. Sales of Class A and C Shares of the Global Value Fund
commenced May 28, 1998. Sales of Class B shares of the Global Value Fund
commenced April 1, 2000. Transactions in shares of beneficial interest were as
follows:
Year Ended Year Ended
September 30, 2000 September 30, 1999
Share Amount Share Amount
Class A Shares
Shares sold .....................3,812,542 $ 65,442,461 1,086,840 $ 13,241,784
Shares issued to shareholders in
reinvestment of dividends .. 167,831 2,857,198 12,858 157,619
Shares repurchased ..............1,201,888) (21,070,627) (67,404) (781,814)
Net Increase ....................2,778,485 $ 47,229,032 ,032,294 $ 12,617,589
Class B Shares
Shares sold ..................... 78,179 $ 1,348,857 0 0
Shares issued to shareholders
in reinvestment of dividends 2,023 33,664 0 0
Shares repurchased ............... (2,964) (49,496) 0 0
Net Increase ..................... 77,238 $ 1,333,025 0 0
Class C Shares
Shares sold .....................1,330,647 $ 22,710,579 216,126 $ 2,574,981
Shares issued to shareholders
in reinvestment of dividends 41,138 691,062 644 7,870
Shares repurchased .............. (38,739) (637,877) (24,628) (291,023)
Net Increase ....................1,333,046 $ 22,763,764 192,142 $ 2,291,828
Note 5 - Securities Transactions
For the year ended September 30, 2000 the Fund had purchase and sale
transactions of investment securities of $120,476,159 and $52,474,805,
respectively. The cost of investments for Federal income tax purpose is
$98,531,680 for the Fund.
At September 30, 2000, net unrealized appreciation of investments was $3,958,081
based on cost for Federal income tax purposes resulting from $9,317,310 gross
unrealized appreciation and $5,359,229 gross unrealized depreciation. At
September 30, 2000, the Fund had tax basis capital losses which may be carried
over to offset future capital gains. Such losses expire as follows:
Capital loss carryovers expiring in:
2007 $ 119,008
2008 272,996
$ 392,004
Notes to financial statements . . . continued
Note 6 - Financial Investments With Off-Balance Sheet Risk
During the year ended September 30, 2000, the Fund was a party to financial
instruments with off-balance sheet risks, primarily currency forward exchange
contracts. A forward exchange contract is an agreement between two parties to
exchange different currencies at a specified rate at an agreed upon future date.
These contracts are purchased in order to minimize the risk to the Fund with
respect to its foreign stock holdings from adverse changes in the relationship
between the U.S. dollar and foreign currencies. In each case these contracts
have been initiated in conjunction with foreign stock holdings. These
instruments may involve market risks in excess of the amount recognized on the
Statement of Assets and Liabilities. Such risks would arise from the possible
inability of counterparties to meet the terms of their contracts, future
movement in currency value and interest rates and contract positions that are
not exact offsets. The contract amounts indicate the extent of the Fund's
involvement in such contracts. At September 30, 2000, the Fund had outstanding
forward exchange contracts for the sale of currencies as set out below. These
contracts are reported in the financial statements at the Fund's net equity, as
measured by the difference between the forward exchange rates at the reporting
date and the forward exchange rates at the dates of entry into the contract.
<TABLE>
<CAPTION>
Contracts to sell:
<S> <C> <C> <C>
4,974,500 Brazilian Real for 2,586,882 U.S. Dollars, December 15, 2000 (36,799)
2,032,500 Brazilian Real for 1,068,331 U.S. Dollars, December 20, 2000 (2,439)
10,789,500 Swiss Francs for 6,582,033 U.S. Dollars, December 20, 2000 .................. 283,340
1,900,000 Swiss Francs for 1,081,173 U.S. Dollars, March 1,2001 ....................... (36,299)
17,682,761 Chinese Renminbi for 2,109,524 U.S. Dollars, December 15, 2000 .............. (22,136)
23,508,173 Euro for 22,237,377 U.S. Dollars, December 20, 2000 ......................... 1,377,320
8,000,000 Euro for 6,913,800 U.S. Dollars, June 20, 2001 .............................. (237,466)
8,881,365 British Pound Sterling for 13,394,937 U.S. Dollars, December 20, 2000 240,132
378,732,503 Hungarian Forint for 1,397,935 U.S. Dollars, November 2, 2000134,152
169,862,997 Hungarian Forint for 586,949 U.S. Dollars, November 6, 2000 ................. 20,386
700,551,519 Japanese Yen for 6,892,699 U.S. Dollars, December 20, 2000 .................. 303,323
1,400,000,000 South Korean Won for 1,222,899 U.S. Dollars, December 20, 2000 .............. (30,346)
8,515,000 Polish Zloty for 1,816,920 U.S. Dollars, December 20, 2000 .................. (11,008)
31,318,903 Swedish Krona for 3,678,259 U.S. Dollars, December 20, 2000 ................. 401,172
63,225,000 New Taiwan Dollars for 2,053,587 U.S. dollars, December 15, 2000 ............ 42,614
Unrealized gain from forward exchange contracts ............................. 2,425,946
</TABLE>
Period Ended
Financial highlights Year Ended September 30, September 30
Class A Shares: 2000 1999 1998(a)
Per share operating performance
(for a share outstanding throughout the year)+
Net asset value, beginning of year $ 12.95 $ 9.79 $ 11.94
Income from investment operations:
Net investment income 0.44 0.12 0.03
Net realized and unrealized
gain (loss) on investments 4.03 3.18 (2.15)
Total from investment operations ..... 4.47 3.30 (2.12)
Less dividends from:
Net investment income . (0.78) (0.14) (0.03)
Change in net asset value ........... 3.69 3.16 (2.15)
Net asset value, end of year ........ $ 16.64 $ 12.95 $ 9.79
Total Return (b) .................... 34.42% 33.79% (17.80)%
Ratios/Supplemental Data Ratios to average net assets:
Net investment income .............. 2.61% 1.07% 1.04%(c)
Expenses, after expense reductions ..... 1.53% 1.63% 1.63%(c)
Expenses, before expense reductions .... 1.55% 1.93% 2.88%(c)
Portfolio turnover rate ................. 86.13% 58.09% 44.66%
Net assets at end of year (000) .........$ 76,070 $ 23,202 $ 7,440
(a) Fund commenced operations on May 28, 1998.
(b) Sales loads are not reflected in computing total return.
(c) Annualized
+Credit ratings are unaudited.
Financial highlights . . . continued
Class B Shares:
Per share operating performance (for a share outstanding throughout the year)+
Net asset value, beginning of year $ 17.62
Income from investment operations:
Net investment income 0.14
Net realized and unrealized
gain (loss) on investments (0.79)
Total from investment operations (0.65)
Less dividends from:
Net investment income (0.53)
In excess of net investment income -
Change in net asset value (1.18)
Net asset value, end of year $ 16.44
Total Return (b) (3.73)%
Ratios/Supplemental Data Ratios to average net assets:
Net investment income 1.63%(c)
Expenses, after expense reductions 2.38%(c)
Expenses, before expense reductions 6.08%(c)
Portfolio turnover rate 86.13%
Net assets at end of year (000) $ 1,270
(a) Effective date of class B shares was April 1, 2000.
(b) Sales loads are not reflected in computing total return.
(c) Annualized
+Credit ratings are unaudited.
Class C Shares:
Per share operating performance
(for a share outstanding throughout the year)+
Net asset value, beginning of year $ 12.88$ 9.77 $ 11.94
Income from investment operations:
Net investment income ............. 0.38 0.04 0.01
Net realized and unrealized
gain (loss) on investments ........ 3.91 3.14 (2.17)
Total from investment operations ... 4.29 3.18 (2.16)
Less dividends from:
Net investment income ............. (0.68) (0.07) (0.01)
Change in net asset value ........... 3.61 3.11 (2.17)
Net asset value, end of year ........ $ 16.49 $ 12.88 $ 9.77
Total Return (b) .................... 33.20% 32.59% (18.12)%
Ratios/Supplemental Data Ratios to average net assets:
Net investment income ............. 2.25% 0.11% (0.02)%(c)
Expenses, after expense reductions 2.37% 2.38% 2.38%(c)
Expenses, before expense reductions 2.43% 3.63% 11.91%(c)
Portfolio turnover rate ............. 86.13% 58.09% 44.66%
Net assets at end of year (000) ...... $ 26,120 $ 3,235 $ 577
(a) Effective date of class C shares was May 28, 1998.
(b) Sales loads are not reflected in computing total return.
(c) Annualized
+Credit ratings are unaudited.
Schedule of investments
CUSIPS: Class A - 885-215-657, Class B - 885-215-616, Class C - 885-215-640
NASDAQ Symbols: Class A - TGVAX, Class B - TGVBX (proposed), Class C -THGCX*
*The proposed Class C symbol (TGVCX) has been changed to THGCX ..............
Shares Value
COMMON STOCKS 91.90%
AIRPORTS (2.40%)
Flughafen Wien AG ........................... 66,522 $2,410,341
BANKS (9.60%)
Banco Popular ............................... 100,000 3,071,030
Bank Rozwoju Eksportu S.A ................... 65,000 1,966,001
Barclays PLC ................................ 110,000 3,045,352
OTP Bank GDR ............................... 35,000 1,785,000
BIOTECHNOLOGY (4.90%)
Bachem AG ................................... 1,010 1,971,831
Serono SA ................................... 2,500 3,056,819
CAPITAL EQUIPMENT (6.00%)
China International Marine Containers ....... 200,000 153,915
Embraer ..................................... 490,000 3,748,779
Muhlbauer Holding AG ........................ 24,245 2,206,931
CONSUMER ELECTRONICS (5.30%)
Philips Electronics ......................... 68,200 2,939,453
Sony Corp. .................................. 25,000 2,540,683
BUILDING MATERIALS (1.50%)
Dyckerhoff AG Preferred ..................... 91,536 1,569,361
PHARMACEUTICALS (6.10%)
Merck KGaA .................................. 60,200 2,048,799
Pharmacia & Upjohn Inc. ..................... 70,000 4,213,125
ELECTRIC UTILITIES (0.30%)
Southern Energy Inc. + ...................... 10,500 329,438
FOREST PRODUCTS (2.10%)
UPM Kymmene OYJ .............................. 83,000 2,124,985
HEALTHCARE SERVICES (2.20%)
Fresenius .................................... 12,000 2,290,679
INSURANCE (1.90%)
Annuity And Life Re Holdings ................. 80,000 1,930,000
INVESTMENT MANAGEMENT & BROKERAGE (9.50%)
Edinburgh Fund Managers Group ................ 60,500 561,893
Goldman Sachs Group Inc. ..................... 20,000 2,278,750
Ing Groep N.V ................................ 45,000 3,001,745
Julius Baer Holding AG ....................... 460 2,389,766
OM Gruppen ................................... 35,000 1,507,020
OFFICE FURNISHINGS & SUPPLIES (0.30%)
Ahrend NV .................................... 30,118 323,394
OIL & GAS (6.80%)
PetroChina Co ADR ............................ 95,000 1,876,250
Shell Transport & Trading .................... 390,000 3,178,009
Unocal Corp. ................................. 55,000 1,949,063
OIL SERVICES (3.30%)
Coflexip SA .................................. 55,000 3,423,750
PUBLISHING (3.50%)
Pearson Plc .................................. 127,272 3,536,703
RETAIL (5.90%)
Fast Retailing ............................... 12,000 2,436,831
Tesco Plc .................................... 979,490 3,599,692
SERVICES (1.30%)
Apcoa Parking AG ............................. 18,550 1,295,091
TECHNOLOGY - SEMI CONDUCTORS & EQUIPMENT (5.30%)
ASE Test + ................................... 65,000 1,365,000
ASM Pacific .................................. 550,000 1,252,165
Samsung Electronic ........................... 7,000 1,267,991
Taiwan Semiconductor + ....................... 450,000 1,494,205
TECHNOLOGY - DISTRIBUTION (2.10%)
ACG AG ....................................... 40,000 2,191,699
TELECOMMUNICATION SERVICES (3.50%)
China Unicom + ............................... 890,000 1,991,984
China Unicom ADR+ 7,500 163,594
Nippon Telegraph and Telephone ............... 150 1,474,338
TELECOMMUNICATION EQUIPMENT (4.90%)
Crown Castle International Corp. + 60,000 1,863,750
Ericsson L M Tel Co ......................... 84,000 1,244,250
Nokia Corp. .................................... 48,000 1,911,000
TOBACCO (0.70%)
Swedish Match AB ............................... 220,715 688,658
CLOSED END FUNDS (2.50%)
I Shares MSCI Japan ............................ 37,600 498,200
India Fund Inc. + 167,300 2,028,513
TOTAL COMMON STOCKS (Cost $90,066,742) 94,195,826
COMMERCIAL PAPER 8.10%
American General Finance, 6.55% due 10/4/2000 4,000,000 3,997,817
United Parcel Service Inc., 6.50% due 10/6/2000 4,300,000 4,296,118
TOTAL COMMERCIAL PAPER (Cost $8,293,935) 8,293,935
TOTAL INVESTMENTS (Cost $98,360,677) (100%) $ 102,489,761
+Non-income producing.
See notes to financial statements.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees and Shareholders of
Thornburg Investment Trust
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Thornburg Global Value Fund series
of Thornburg Investment Trust (the "Fund") at September 30, 2000, the results of
its operations for the year then ended, the changes in its net assets and the
financial highlights for each of the two years in the period then ended, in
conformity with accounting principles generally accepted in the United States of
America. These financial statements and financial highlights (hereafter referred
to as "financial statements") are the responsibility of the Fund's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these financial statements in
accordance with auditing standards generally accepted in the United States of
America, which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at September 30, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion. The financial highlights for each of the three years in the period
ended September 30, 1998 were audited by other independent accountants whose
report dated October 23, 1998 expressed an unqualified opinion on those
financial statements.
PricewaterhouseCoopers LLP
New York, New York
October 27, 2000
Index Comparison
Thornburg Global Value Fund
Index Comparison
Compares performance of Thornburg Global Value Fund and Morgan Stanley Capital
International Europe, Australia and Far East Index for the period May 28, 1998
to September 30, 2000. Past performance of the Index and the Fund may not be
indicative of future performance.
Class A Shares
Average Annual Total Returns (at max. offering price) (periods ending 9/30/00)
Since inception (5/28/98) 15.85%
One year 28.37%
Class C Shares
Average Annual Total Returns (periods ending 9.30.00)
Since inception (5/28/98) 17.03%
One year 33.20%
Investment Manager
Thornburg Investment Management, Inc.
119 East Marcy Street
Santa Fe, New Mexico 87501
800.847.0200
Principal Underwriter
Thornburg Securities Corporation
119 East Marcy Street
Santa Fe, New Mexico 87501
800.847.0200
