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[Logo] M F S (R)
INVESTMENT MANAGEMENT
We invented the mutual fund(R)
[Graphic Omitted]
MFS(R) GLOBAL
GROWTH FUND
ANNUAL REPORT o OCTOBER 31, 1999
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TABLE OF CONTENTS
Letter from the Chairman .................................................. 1
Management Review and Outlook ............................................. 3
Performance Summary ....................................................... 8
Portfolio of Investments .................................................. 12
Financial Statements ...................................................... 29
Notes to Financial Statements ............................................. 36
Independent Auditors' Report .............................................. 42
MFS' Year 2000 Readiness Disclosure ....................................... 44
Trustees and Officers ..................................................... 45
MFS ORIGINAL RESEARCH(R)
RESEARCH HAS BEEN CENTRAL TO INVESTMENT MANAGEMENT AT MFS
SINCE 1932, WHEN WE CREATED ONE OF THE FIRST IN-HOUSE
RESEARCH DEPARTMENTS IN THE MUTUAL FUND (SM)
INDUSTRY. ORIGINAL RESEARCH(SM) AT MFS IS MORE ORIGINAL RESEARCH
THAN JUST CRUNCHING NUMBERS AND CREATING
ECONOMIC MODELS: IT'S GETTING TO KNOW MFS
EACH SECURITY AND EACH COMPANY PERSONALLY.
MAKES A DIFFERENCE
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NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
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<PAGE>
LETTER FROM THE CHAIRMAN
[Photo of Jeffrey L. Shames]
Jeffrey L. Shames
Dear Shareholders,
The current investment and economic environment bears little resemblance to last
year's. One year ago, global economies were floundering, and the crisis in Asia
threatened an already weak U.S. economy. Corporate earnings were flat, and
economists used the word "deflation" for the first time in recent memory.
Entering 1999, expectations for corporate earnings growth were lowered
dramatically. In an attempt to foster U.S. growth, the Federal Reserve Board
(the Fed) lowered interest rates.
As a result, this year the U.S. economy is booming and unemployment is low. Many
corporations are focused on improving their profitability, and investors have
been rewarded with positive surprises across a variety of industries. Our
analysts predict that corporate earnings growth for 1999 will average 12% - 15%.
Global economies also are showing signs of strength, and the Asian crisis has
passed. In fact, Japan's economic woes seem to have reached bottom. Although the
process is in its infancy, some Japanese corporations not only are talking about
restructuring and cost cutting, they also are beginning to take action, looking
within to become more competitive and improve returns on equity. While still
lagging the United States, Europe is beginning to restructure and consolidate.
These signs of international growth have contributed to concerns that the U.S.
economy now may be too strong. In June, and again in August, the Fed raised
rates by one-quarter of a percentage point to help ward off the specter of
inflation.
After an unprecedented four years of 20% annual returns in the U.S. equity
market, we fear that many investors have become accustomed to high returns and
have lost sight of the risks they take on to achieve them. In the current market
many investors are taking on additional risk - whether through day trading or
investing in speculative Internet stocks.
Risks are as much a part of the market today as they were one year ago. We
believe the market remains overvalued, with stocks priced 30% above our
analysts' earnings projections. And market narrowness has not abated; the top 25
stocks in the Standard & Poor's 500 Composite Index, a popular, unmanaged index
of common stock total return performance, are still the most overvalued. Such
extreme overvaluation makes the stock market sensitive to interest-rate news and
any negative earnings surprises. The Year 2000 (Y2K) computer problem is another
factor causing investor concern. While we believe corporate America is well
prepared to address any Y2K situations that may arise at year-end, no one can
predict investor behavior. In our opinion, it is investor behavior that has the
greatest potential to create market volatility.
We believe the best way to address Y2K and other market risks is through our
continuing commitment to MFS Original Research(R) and our fundamental investment
tenet of long-term investing. Whether markets are up or down, MFS analysts focus
on analyzing industries and visiting companies to determine the long-term
winners and the prices that will make them attractive opportunities. Because all
companies will not benefit equally from the improving international environment,
bottom-up research remains critical to identifying those that we believe are
successfully restructuring, consolidating, and gaining market share.
Changes in market and economic conditions can't be predicted but should always
be expected. The changes we have seen over the past year only reinforce our
commitment to long-term planning and investing. We believe volatility helps to
create opportunity for long-term investors to buy solid companies at attractive
prices. For this reason, we are continuing to expand our domestic and
international capabilities to ensure that MFS has primary, in-house research on
companies worldwide. We believe that we have built the right investment team,
backed by MFS Original Research, to take advantage of those opportunities for
our shareholders.
We appreciate your confidence and welcome any questions or comments you may
have.
Respectfully,
/s/ Jeffrey L. Shames
Jeffrey L. Shames
Chairman and Chief Executive Officer
MFS Investment Management(R)
November 15, 1999
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MANAGEMENT REVIEW AND OUTLOOK
For the 12 months ended October 31, 1999, Class A shares of the Fund provided a
total return of 38.13%, Class B shares 37.12%, Class C shares 37.15%, and Class
I shares 38.55%. These returns assume the reinvestment of distributions but
exclude the effects of any sales charges.
During the same period, the average global fund tracked by Lipper Analytical
Services, Inc., an independent firm that reports mutual fund performance,
returned 28.13%. The Fund's returns also compare to a 26.41% return for the
Morgan Stanley Capital International (MSCI) All Country World Index, an
unmanaged index of developed-country and emerging market equities.
Q. WHAT FACTORS CONTRIBUTED TO THE FUND'S STRONG PERFORMANCE?
A. A combination of three factors helped lead the Fund's strong performance.
First was the investments in U.S. technology and telecommunications stocks,
which generally posted strong returns. Emerging market holdings also aided
performance. Finally, an expanded emphasis on Japanese stocks was a plus.
The ongoing explosion of the Internet, coupled with investors' seemingly
unquenchable thirst for fast-growing companies, helped boost the majority of
our U.S. technology holdings to double- and triple-digit returns. Cisco
Systems, the number one maker of equipment that steers data between
computers, and software giant Microsoft each posted exceedingly strong
gains. Other hearty performers included Oracle and Sun Microsystems. On the
telecommunications front, one of our best performers was MCI WorldCom. It
and other telecommunications holdings were buoyed by the rapidly expanding
demand for wireless communications and data transmission.
Q. HOW DID TELECOMMUNICATIONS COMPANIES BEYOND U.S. BORDERS PERFORM?
A. The Fund's holdings in foreign telecommunications companies also fared quite
well. Europe, which leads the United States in cellular communications
penetration, had its share of telecommunications winners, with many
companies enjoying better-than-expected subscriber growth. In particular,
our holdings in German telecommunications company Mannesmann and British
cellular company Orange performed quite well. In Japan, some of the biggest
standouts were NTT Mobile Communications Network. Likewise, some of our
best-performing emerging market holdings came from the telecommunications
sector, with Telefonos de Mexico and several of the Brazilian telecom
companies that once made up the state-owned Telebras posting exceptionally
good returns.
Q. WHICH EMERGING MARKET HOLDINGS WERE POSITIVE CONTRIBUTORS TO PERFORMANCE?
A. The Philippines came out of last year's Asian crisis on much firmer ground
than many of its neighbors, which helped our holdings in the South Korean
market stage a strong rally in response to investors' enthusiasm for the way
the country handled its fiscal and political challenges. That, plus a more
favorable backdrop for semiconductor chips, helped lift the performance of
our holdings in South Korea's Samsung Electronics. In Taiwan, the
semiconductor turnaround boosted the technology sector.
We identified some attractive opportunities in the more developed markets of
Hong Kong and Singapore, such as Datacraft, an information technology
company, and the Development Bank of Singapore (DBS). We believe that, like
emerging markets, Hong Kong and Singapore are poised to benefit from
Southeast Asia's economic turnaround. In addition, we have more confidence
in the banking and political systems in Hong Kong and Singapore. A more
favorable fiscal policy helped Turkish bank Yapi ve Kredi Bankasi also
contributed to the Fund's performance.
Q. WHY WERE JAPANESE HOLDINGS SUCH AN IMPORTANT CONTRIBUTOR TO THE FUND'S
PERFORMANCE?
A. By the end of the year, we had doubled our holdings in Japanese companies,
which were some of the strongest performers in the global market. Our
decision to increase our exposure to Japan stemmed from the tremendous
amount of corporate restructuring that was taking place. Companies were
cutting costs, selling off noncore assets, and renewing their focus on
improving their bottom lines. Companies that fit these criteria include NTT
Mobile Communications Network and Sakura Bank, both of which posted good
gains. In addition, we identified pockets of opportunities where Japan's
economic rebound translated into real earnings growth. Discount retailers
such as Don Quijote, Fast Retailing, and Rock Field enjoyed impressive
earnings growth of 50% to 100% this year, and their stocks rallied in
response.
Q. DID ANY POSITIONS DETRACT FROM PERFORMANCE?
A. Some of our European stock picks were disappointing. British Aerospace,
which we bought because we believed it would benefit from consolidation in
the aerospace sector, was one of the biggest detractors. Investors, who
expected the company to hook up with a foreign competitor, looked
unfavorably on the company's merger with another U.K. company. However, we
have maintained a position in British Aerospace because we believe
consolidation will continue and ultimately may translate into better
earnings for the company. In addition, we think that the stock is cheap and
that its government contracts should help provide a measure of earnings
predictability. In the United States, Office Depot suffered under the weight
of intensified competition from megastores and Internet-based suppliers.
Q. ALTHOUGH THE RETURNS OF EUROPEAN STOCKS WERE MUTED BY A SLOW ECONOMY, WERE
THERE ANY FUND HOLDINGS THAT BUCKED THE TREND?
A. Companies involved with advertising were strong performers for the Fund.
The introduction of the euro earlier this year and the tremendous wave of
consolidation among European companies combined to create a much more
competitive environment for most industries. Many European companies have
responded to increased competitive pressures by expanding their advertising
efforts as a means to set them apart from their competition. That
advertising upswing, in turn, helped boost French television company
Television Francaise.
Q. WHAT'S YOUR OUTLOOK FOR GLOBAL MARKETS?
A. We're reasonably optimistic about U.S. stocks, although we think the
market's leadership will eventually change. Last year's market climb was led
by fewer and fewer large-cap technology companies. As a result, many of the
best-performing, large technology stocks have had valuations that to us look
a bit stretched. But beyond the handful of high-flying technology names, we
think there are many attractive bargains in the domestic market. As long as
the U.S. economy remains relatively strong, we believe U.S. stocks could do
well.
We're also optimistic about many of the emerging markets. In our view, some
of the turmoil they experienced a couple of years ago ultimately translated
into positive results, including better financial discipline. That newfound
sense of responsibility, coupled with an ongoing global recovery and
potential commodity price appreciation, could benefit emerging markets.
In Europe, part of our enthusiasm stems from cheap stocks and from the
economy's recent rebound. But there are other reasons as well. A lot of the
recent corporate restructuring has begun to lead to better financial
results. Because companies have become more efficient and most of the costs
of restructuring are behind them, we think corporate earnings growth could
outstrip economic growth there.
It's unclear whether Japan's recent growth spurt will turn into a sustained
economic recovery. In our view, there are some positive signs. Because of
their restructuring efforts, banks presumably are in a better position to
lend as a means to stimulate economic growth. In general, we are optimistic
about the potential of individual companies rather than about improvement in
the overall economy. But until there's more concrete evidence that Japan's
rebound is here to stay, we'll remain selective, using MFS Original
Research(R) to help us find investment opportunities even in difficult
markets.
/s/ David A. Antonelli /s/ John W. Ballen
David A. Antonelli John W. Ballen
Director of International Portfolio Manager
Equity Research*
/s/ Toni Y. Shimura
Toni Y. Shimura
Portfolio Manager
* The committee of MFS international research analysts is responsible for the
day-to-day management of a portion of the Fund under the general supervision
of Mr. Antonelli.
The opinions expressed in this report are those of the portfolio managers and
the Director of International Equity Research and are current only through the
end of the period of the report as stated on the cover. The managers' views are
subject to change at any time based on market and other conditions, and no
forecasts can be guaranteed.
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PORTFOLIO MANAGERS' PROFILES
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JOHN W. BALLEN IS PRESIDENT, CHIEF INVESTMENT OFFICER, AND A MEMBER OF THE
MANAGEMENT COMMITTEE AND BOARD OF DIRECTORS OF MFS INVESTMENT MANAGEMENT(R).
HE IS PORTFOLIO MANAGER OF MFS(R) EMERGING GROWTH FUND. MR. BALLEN IS ALSO A
PORTFOLIO MANAGER OF MFS(R) INSTITUTIONAL EMERGING EQUITIES FUND, MFS(R)
EMERGING GROWTH SERIES (PART OF MFS(R) VARIABLE INSURANCE TRUST(SM)), THE
EMERGING GROWTH SERIES OFFERED THROUGH MFS(R)/ SUN LIFE ANNUITY PRODUCTS,
MFS(R) INSTITUTIONAL MID CAP GROWTH FUND, MFS(R) GLOBAL GROWTH FUND, AND THE
GLOBAL GROWTH SERIES OFFERED THROUGH MFS(R)/SUN LIFE ANNUITY PRODUCTS. MR.
BALLEN JOINED THE MFS RESEARCH DEPARTMENT IN 1984 AS A RESEARCH ANALYST. HE
WAS NAMED INVESTMENT OFFICER AND PORTFOLIO MANAGER IN 1986, VICE PRESIDENT IN
1987, DIRECTOR OF RESEARCH IN 1988, SENIOR VICE PRESIDENT IN 1990, DIRECTOR
OF EQUITY PORTFOLIO MANAGEMENT IN 1993, CHIEF EQUITY OFFICER IN 1995,
EXECUTIVE VICE PRESIDENT IN 1997, AND PRESIDENT, CHIEF INVESTMENT OFFICER,
AND A MEMBER OF THE BOARD IN 1998. MR. BALLEN IS A GRADUATE OF HARVARD
COLLEGE AND EARNED A MASTER OF COMMERCE DEGREE FROM THE UNIVERSITY OF NEW
SOUTH WALES IN AUSTRALIA AND AN M.B.A. DEGREE FROM STANFORD UNIVERSITY.
TONI Y. SHIMURA IS SENIOR VICE PRESIDENT OF MFS INVESTMENT MANAGEMENT(R) AND
PORTFOLIO MANAGER OF MFS(R) MANAGED SECTORS FUND AND THE MANAGED SECTORS
SERIES OFFERED THROUGH MFS(R)/SUN LIFE ANNUITY PRODUCTS. SHE IS ALSO A
PORTFOLIO MANAGER OF MFS(R) GLOBAL GROWTH FUND, MFS(R) EMERGING GROWTH SERIES
(PART OF MFS(R) VARIABLE INSURANCE TRUST(SM)), AND THE GLOBAL GROWTH SERIES
AND THE EMERGING GROWTH SERIES, BOTH OFFERED THROUGH MFS(R)/SUN LIFE ANNUITY
PRODUCTS. MS. SHIMURA JOINED MFS IN 1987 AS A RESEARCH ANALYST. SHE WAS NAMED
INVESTMENT OFFICER IN 1990, ASSISTANT VICE PRESIDENT IN 1991, VICE PRESIDENT
IN 1992, PORTFOLIO MANAGER IN 1993, AND SENIOR VICE PRESIDENT IN 1999. MS.
SHIMURA IS A GRADUATE OF WELLESLEY COLLEGE AND THE SLOAN SCHOOL OF MANAGEMENT
OF THE MASSACHUSETTS INSTITUTE OF TECHNOLOGY.
ALL EQUITY PORTFOLIO MANAGERS BEGAN THEIR CAREERS AT MFS INVESTMENT
MANAGEMENT(R) AS RESEARCH ANALYSTS. OUR PORTFOLIO MANAGERS ARE SUPPORTED BY
AN INVESTMENT STAFF OF OVER 100 PROFESSIONALS UTILIZING MFS ORIGINAL
RESEARCH(R), A COMPANY-ORIENTED, BOTTOM-UP PROCESS OF SELECTING SECURITIES.
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This report is prepared for the general information of shareholders. It is
authorized for distribution to prospective investors only when preceded or
accompanied by a current prospectus. A prospectus containing more information,
including the exchange privilege and all charges and expenses, for any other MFS
product is available from your financial consultant, or by calling MFS at
1-800-225-2606. Please read it carefully before investing or sending money.
<PAGE>
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FUND FACTS
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OBJECTIVE: SEEKS CAPITAL APPRECIATION BY INVESTING IN SECURITIES
OF COMPANIES WORLDWIDE GROWING AT RATES MANAGERS EXPECT
TO BE WELL ABOVE THE GROWTH RATE OF THE U.S. ECONOMY.
COMMENCEMENT OF
INVESTMENT OPERATIONS: NOVEMBER 18, 1993
CLASS INCEPTION: CLASS A NOVEMBER 18, 1993
CLASS B NOVEMBER 18, 1993
CLASS C JANUARY 3, 1994
CLASS I JANUARY 2, 1997
SIZE: $608.7 MILLION NET ASSETS AS OF OCTOBER 31, 1999
PERFORMANCE SUMMARY
The following information illustrates the historical performance of the Fund's
original share class in comparison to various market indicators. Performance
results include the deduction of the maximum applicable sales charge and reflect
the percentage change in net asset value, including reinvestment of dividends.
Benchmark comparisons are unmanaged and do not reflect any fees or expenses. The
performance of other share classes will be greater than or less than the line
shown. (See Notes to Performance Summary.) It is not possible to invest directly
in an index.
GROWTH OF A HYPOTHETICAL $10,000 INVESTMENT
(For the period from the commencement of the Fund's investment operations,
November 18, 1993, through October 31, 1999. Index information is from
December 1, 1993.)
MFS Global S&P 500 MSCI All Russell 2000
Growth Fund - Composite Country MSCI Total Return
Class A Index World Index World Index Index
------------- --------- ----------- ----------- ------------
12/93 $ 9,425 $10,121 $10,581 $10,494 $10,342
10/94 10,964 10,487 11,604 11,467 10,304
10/95 11,564 13,259 12,430 12,618 12,194
10/96 13,383 16,454 14,370 14,741 14,219
10/97 15,414 21,738 16,632 17,272 18,390
10/98 15,107 26,518 18,755 19,982 16,212
10/99 20,868 33,326 23,707 25,024 18,623
AVERAGE ANNUAL AND CUMULATIVE TOTAL RATES OF RETURN THROUGH OCTOBER 31, 1999
<TABLE>
<CAPTION>
CLASS A
1 Year 3 Years 5 Years Life*
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge +38.13% +55.93% +90.32% +121.41%
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Average Annual Total Return Excluding Sales Charge +38.13% +15.96% +13.74% + 14.29%
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Average Annual Total Return Including Sales Charge +30.19% +13.69% +12.40% + 13.16%
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<CAPTION>
CLASS B
1 Year 3 Years 5 Years Life*
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge +37.12% +52.49% +83.08% +111.41%
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Average Annual Total Return Excluding Sales Charge +37.12% +15.10% +12.86% + 13.40%
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Average Annual Total Return Including Sales Charge +33.12% +14.34% +12.61% + 13.31%
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<CAPTION>
CLASS C
1 Year 3 Years 5 Years Life*
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge +37.15% +52.45% +83.33% +111.93%
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Average Annual Total Return Excluding Sales Charge +37.15% +15.09% +12.89% + 13.45%
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Average Annual Total Return Including Sales Charge +36.15% +15.09% +12.89% + 13.45%
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<CAPTION>
CLASS I
1 Year 3 Years 5 Years Life*
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge +38.55% +57.26% +91.94% +123.29%
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Average Annual Total Return Excluding Sales Charge +38.55% +16.29% +13.93% + 14.45%
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<CAPTION>
COMPARATIVE INDICES
1 Year 3 Years 5 Years Life*
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<S> <C> <C> <C> <C>
Average global fund+(+) +28.13% +15.73% +14.06% + 13.78%
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MSCI All Country World Index#(+) +26.41% +18.16% +15.36% + 15.71%
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MSCI World Index#(+)** +25.24% +19.29% +16.89% + 16.77%
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Standard & Poor's 500 Composite Index(+)#** +25.67% +26.52% +26.02% + 22.56%
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Russell 2000 Total Return Index(+)#** +14.87% + 9.41% +12.57% + 11.08%
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* For the period from the commencement of the Fund's investment operations, November 18, 1993, through
October 31, 1999. Index information is from December 1, 1993, through October 31, 1999.
+ Source: Lipper Analytical Services, Inc.
(+) Average annual rates of return.
# Standard & Poor's Micropal, Inc.
** Effective October 31, 1999, these indices are no longer being used as benchmarks because we believe the
MSCI All Country World Index better reflects the Fund's investment objective and strategies.
</TABLE>
NOTES TO PERFORMANCE SUMMARY
Class A Share Performance Including Sales Charge takes into account the
deduction of the maximum 5.75% sales charge. Class B Share Performance Including
Sales Charge takes into account the deduction of the applicable contingent
deferred sales charge (CDSC), which declines over six years from 4% to 0%. Class
C Share Performance Including Sales Charge takes into account the deduction of
the 1% CDSC applicable to Class C shares redeemed within 12 months. Class I
shares have no sales charge and are only available to certain institutional
investors.
Class C share performance includes the performance of the Fund's Class B shares
for periods prior to its inception (blended performance). Class I share
performance includes the performance of the Fund's Class A shares for periods
prior to its inception (blended performance). Class C blended performance has
been adjusted to take into account the lower CDSC applicable to Class C shares.
Class I share blended performance has been adjusted to account for the fact that
Class I shares have no sales charge. These blended performance returns have not
been adjusted to take into account differences in class- specific operating
expenses. Because operating expenses of Class B and C shares are approximately
the same, the blended Class C performance is approximately the same as it would
have been had Class C shares been offered for the entire period. Because
operating expenses of Class I shares are lower than those of Class A, the
blended Class I share performance is lower than it would have been had Class I
shares been offered for the entire period.
All performance results reflect any applicable expense subsidies and waivers,
without which the results would have been less favorable. Subsidies and waivers
may be rescinded at any time. See the prospectus for details. All results are
historical and assume the reinvestment of capital gains.
INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, AND SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PAST PERFORMANCE
IS NO GUARANTEE OF FUTURE RESULTS.
Investments in foreign and emerging market securities may provide superior
returns but also involve greater risk than U.S. investments. Investments in
foreign and emerging market securities may be favorably or unfavorably affected
by changes in interest rates and currency exchange rates, market conditions, and
the economic and political conditions of the countries where investments are
made. These risks may increase share price volatility. See the prospectus for
details.
PORTFOLIO CONCENTRATION AS OF OCTOBER 31, 1999
FIVE LARGEST STOCK SECTORS
TECHNOLOGY 34.9%
UTILITIES & COMMUNICATIONS 18.5%
FINANCIAL SERVICES 11.9%
LEISURE 5.8%
CONGLOMERATES, SPECIAL PROJECTS/SERVICES 5.5%
TOP 10 STOCK HOLDINGS
CISCO SYSTEMS, INC. 3.7% TYCO INTERNATIONAL, LTD. 2.5%
U.S. computer network developer U.S. security systems, packaging, and
electronic equipment conglomerate
ORACLE CORP. 3.2%
U.S. database software developer NTT MOBILE COMMUNICATIONS NETWORK, INC. 2.1%
and manufacturer Japanese cellular phone company
MICROSOFT CORP. 2.7%
U.S. computer software and systems MANNESMANN AG 1.7%
company German industrial and telecommunications
company
MCI WORLDCOM, INC. 2.5%
U.S. telecommunications company BMC SOFTWARE, INC. 1.6%
U.S. computer software company
QUALCOMM, INC. 2.5%
U.S. teleommunications equipment NIPPON TELEPHONE & TELEGRAPH CO. 1.3%
company Japanese telecommunication services company
The portfolio is actively managed, and current holdings may be different.
<PAGE>
PORTFOLIO OF INVESTMENTS -- October 31, 1999
<TABLE>
<CAPTION>
Stocks - 91.7%
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ISSUER SHARES VALUE
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<S> <C> <C>
Foreign Stocks - 51.1%
Argentina
Banco de Galicia y Buenos Aires S.A. de C.V., ADR
(Banks and Credit Cos.) 2,662 56,235
Perez Companc S.A. (Oils) 28,476 $ 171,508
------------
$ 227,743
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Australia - 0.6%
Cable & Wireless Optus (Telecommunications) 1,189,700 $ 2,721,496
QBE Insurance Group Ltd. (Insurance) 255,931 1,068,169
------------
$ 3,789,665
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Bermuda - 0.3%
Ace Ltd. (Insurance) 800 $ 15,550
Global Crossing Ltd. (Telecommunications)* 48,000 1,662,000
------------
$ 1,677,550
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Brazil - 0.6%
Aracruz Celulose S.A. (Forest and Paper Products) 12,900 $ 264,450
Banco Itau S.A. (Banks and Credit Cos.) 3,434,700 197,174
Caemi Mineracao e Metalurgica S.A. (Minerals) 1,481,300 69,471
Cia Brasileira de Distribuicao Grupo Pao de Acucar,
ADR (Supermarkets) 8,200 179,375
Cia Vale Rio Doce, Bonus Shares (Mining) 29,553 0
Companhia Energetica do Ceara, Preferred, "A"
(Utilities - Electric) 55,000 115,582
Companhia Vale Rio Doce, ADR (Steel) 18,400 366,896
Companhia Vale Rio Doce, Preferred (Mining) 6,153 122,335
Petroleo Brasileiro S.A. (Oils) 18,900 299,943
Petroleo Brasileiro S.A., Preferred (Oils) 5,975,000 950,916
Tele Centro Sul Participacoes S.A.
(Telecommunications)* 28,711,985 206,915
Tele Centro Sul Participacoes S.A., ADR
(Telecommunications)* 1,900 113,525
Tele Centro Sul Participacoes S.A., Preferred
(Telecommunications)* 16,871,000 201,570
Telesp Participacoes S.A. (Telecommunications) 4,700 76,081
Telesp Participacoes S.A. (Telecommunications) 6,244,485 64,973
Telesp Participacoes S.A., Preferred
(Telecommunications) 19,459 312,182
Uniao de Banco Brasiliero S.A. (Banks and Credit
Cos.) 9,850 226,550
------------
$ 3,767,938
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Canada - 0.8%
Abitibi-Consolidated, Inc. (Forest and Paper
Products) 93,600 $ 1,129,050
Aliant, Inc. (Telecommunications) 75,400 1,135,048
BCE, Inc. (Telecommunications) 30,500 1,837,625
Canadian National Railway Co. (Railroads) 32,264 984,052
QLT Phototherapeutics (Medical and Health Products)* 800 33,900
------------
$ 5,119,675
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Chile - 0.1%
Distribucion y Servicio S.A., ADR (Supermarkets) 16,890 $ 275,518
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China - 0.4%
China Telecom Hong Kong Ltd. (Telecommunications)* 26,800 $ 1,809,000
Guangshen Railway Ltd., ADR (Railroads) 85,100 489,325
------------
$ 2,298,325
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Colombia
Bancolombia S.A. (Banks and Credit Cos.) 22,400 $ 93,800
- ----------------------------------------------------------------------------------------
Czechoslovakia
SPT Telecom AS (Telecommunications)* 13,500 $ 201,150
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Egypt
Egypt Mobile Phone (Telecommunications)* 10,500 $ 271,649
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Estonia
As Eesti Telekom, GDR (Telecommunications)## 9,955 $ 156,294
- ----------------------------------------------------------------------------------------
Finland - 2.0%
Helsingin Puhelin Oyj (Telecommunications) 42,631 $ 2,023,917
Nokia Corp., ADR (Telecommunications) 38,700 4,472,269
Perlos Oyj Corp. (Electronics)* 93,200 1,528,797
Sonera Oyj (Telecommunications) 81,000 2,431,647
Tieto Corp. (Computer Software - Systems) 41,870 1,452,869
------------
$ 11,909,499
- ----------------------------------------------------------------------------------------
France - 4.2%
Axa (Insurance) 26,700 $ 3,764,866
Banque Nationale de Paris (Banks and Credit Cos.) 14,600 1,281,884
Bouygues S.A. (Construction) 8,260 2,874,865
Business Objects S.A., ADR (Computer Software -
Systems)* 500 36,000
Castorama-Dubois Investisse (Stores) 8,130 2,434,669
Rhone-Poulenc S.A. (Pharmaceuticals) 64,400 3,602,525
Sanofi - Synthelabo S.A. (Medical and Health
Products)* 12,100 533,736
SEITA (Tobacco) 48,300 2,691,736
Television Francaise (Entertainment) 11,689 3,662,714
Total S.A., "B" (Oils) 21,200 2,864,497
Wavecom S.A., ADR (Electronics)* 81,200 1,583,400
------------
$ 25,330,892
- ----------------------------------------------------------------------------------------
Germany - 2.4%
Fielmann AG, Preferred (Retail) 17,600 $ 666,231
Henkel KGaA, Preferred (Chemicals) 39,783 2,698,154
Mannesmann AG (Conglomerate) 60,516 9,513,073
Porsche AG (Automotive) 500 1,361,693
SAP AG, ADR (Computer Software - Systems) 10,800 395,550
------------
$ 14,634,701
- ----------------------------------------------------------------------------------------
Greece - 0.6%
Alpha Credit Bank S.A., GDR (Banks and Credit Cos.) 9,540 $ 729,893
Antenna TV S.A., ADR (Broadcasting)* 53,050 477,450
Athens Medical Center, GDR (Medical and Health
Technology and Services) 3,800 227,256
Hellenic Telecommunication Organization S.A., GDR
(Telecommunications) 70,368 1,491,750
National Bank of Greece, GDR (Banks and Credit Cos.) 4,865 348,951
STET Hellas Telecommunications S.A., ADR
(Telecommunications)* 13,800 296,700
------------
$ 3,572,000
- ----------------------------------------------------------------------------------------
Hong Kong - 1.1%
China Telecom Ltd. (Telecommunications) 1,038,000 $ 3,547,747
Li & Fung Ltd. (Wholesale) 1,676,000 2,858,780
Yue Yuen Industrial Holdings (Holding Co.) 211,000 535,105
------------
$ 6,941,632
- ----------------------------------------------------------------------------------------
Hungary - 0.1%
Gedeon Richter Ltd., GDR (Pharmaceuticals) 2,045 $ 91,309
Magyar Olaj Es Gazipari KT (Gas) 4,630 93,331
Magyar Tavkozlesi Rt., ADR (Telecommunications) 15,405 443,857
OTP Bank Rt. (Banks and Credit Cos.) 2,400 109,051
------------
$ 737,548
- ----------------------------------------------------------------------------------------
India - 0.4%
ICICI Ltd.* 52,000 $ 572,000
Infosys Technologies Ltd., ADR (Computer Software -
Services) 7,000 1,057,000
Larsen & Toubro Ltd. (Construction - Special) 460 4,228
Tata Iron and Steel Co. Ltd. (Steel) 50 171
Videsh Sanchar Nigam Ltd., GDR (Telecommunications)## 61,000 954,650
------------
$ 2,588,049
- ----------------------------------------------------------------------------------------
Indonesia - 0.2%
Gulf Indonesia Resources Ltd. (Oil Services)* 109,350 $ 867,966
H M Sampoerna TBK (Tobacco) 190,000 442,313
------------
$ 1,310,279
- ----------------------------------------------------------------------------------------
Ireland - 1.0%
Anglo Irish Bank Corp. PLC (Banks and Credit Cos.) 1,155,348 $ 2,690,259
Bank of Ireland (Banks and Credit Cos.)* 277,300 2,163,531
Elan Corp. PLC, ADR (Health Products)* 39,100 1,006,825
Trintech Group PLC, ADR (Computer Software -
Products)* 1,050 18,506
------------
$ 5,879,121
- ----------------------------------------------------------------------------------------
Israel - 0.1%
Blue Square Israel Ltd. (Retail) 28,825 $ 376,527
ECI Telecom Ltd. (Telecommunications) 7,812 227,524
------------
$ 604,051
- ----------------------------------------------------------------------------------------
Italy - 0.8%
Banca Carige S.p.A. (Banks and Credit Cos.) 99,829 $ 877,551
San Paolo - Imi S.p.A (Banks and Credit Cos.) 136,517 1,768,508
Telecom Italia Mobile S.p.A. (Telecommunications) 387,000 2,417,168
------------
$ 5,063,227
- ----------------------------------------------------------------------------------------
Japan - 13.6%
Kyocera Corp. (Electronics) 6,000 $ 575,705
Pioneer Electronic Corp. (Electronics) 71,000 1,267,809
Aeon Credit Service Co., Ltd. (Financial Services) 10,600 1,545,960
Canon, Inc. (Special Products and Services) 138,000 3,906,160
Chugai Pharmaceutical Co. Ltd. (Pharmaceuticals) 234,000 2,784,111
Coca-Cola West Japan Co. Ltd. (Food and
Beverage Products) 12,000 534,254
Daiwa Securities Group, Inc. (Banks and Credit Cos.) 362,000 3,865,918
DDI Corp. (Telecommunications) 122 1,334,485
Don Quijote Co., Ltd. (Retail) 19,400 4,839,762
East Japan Railway Co. (Railroads) 367 2,250,173
Fast Retailing Co. (Retail) 7,400 1,775,091
Fuji Heavy Industries Ltd. (Automotive) 123,000 1,045,653
Hitachi Ltd. (Electronics) 422,000 4,563,366
Keyence Corp. (Electronics) 10,030 2,689,872
Mikuni Coca-Cola Bottling Co. Ltd. (Food and
Beverage Products) 52,000 1,097,678
Mimasu Semiconductor Industry Co. Ltd. (Electronics) 53,900 1,124,856
Mitsubishi Motor (Automotive) 290,000 1,505,373
Nippon Telephone & Telegraph Co. (Utilities -
Telephone) 467 7,169,449
Nitto Denko Corp. (Industrial Goods and Services) 37,000 1,462,675
NTT Mobile Communications Network, Inc.
(Telecommunications) 431 11,455,287
Orix Corp. (Financial Services) 46,800 6,286,701
Rock Field Co., Ltd. (Food Products) 16,600 821,877
Rohm Co. (Electronics) 14,000 3,143,351
Sakura Bank Ltd. (Banks and Credit Cos.) 419,000 3,602,226
Sony Corp. (Electronics) 7,600 1,185,723
Sony Corp., ADR (Electronics) 5,300 846,675
Sumitomo Bank Ltd. (Banks and Credit Cos.) 97,000 1,561,754
Takeda Chemical Industries Co. (Pharmaceuticals) 50,000 2,873,729
Terumo Corp. (Pharmaceuticals) 87,000 2,646,229
Toshiba Corp. (Electronics) 160,000 1,007,100
Ushio, Inc. (Electronics) 161,000 1,981,990
------------
$ 82,750,992
- ----------------------------------------------------------------------------------------
Malaysia - 0.3%
Malayan Banking Berhad (Banks and Credit Cos.)+ 91,000 $ 293,475
Malaysian Pacific Industries Berhad (Electronics)+ 82,000 338,250
Resorts World Berhad (Entertainment)+ 116,000 316,100
Sime Darby Berhad (Holding Company)+ 250,000 283,750
Telekom Malaysia Berhad (Telecommunications)+ 102,000 298,350
------------
$ 1,529,925
- ----------------------------------------------------------------------------------------
Mexico - 1.4%
Cemex S.A. (Construction)* 10,760 $ 242,100
Cemex S.A. Preferred (Construction)* 1 5
Cifra S.A. de C.V. (Retail)* 244,135 384,232
Cifra S.A. de C.V., ADR (Retail)* 6,000 93,720
Coca-Cola Femsa S.A., ADR (Beverages) 33,700 467,588
Fomento Economico Mexicano S.A. (Food and
Beverage Products) 13,140 431,156
Grupo Continential, S.A. (Food and Beverage Products) 138,400 155,587
Grupo Financiero Banorte S.A. de C.V. (Finance)* 132,200 165,129
Grupo Mexico, S.A. (Metals) 52,700 190,898
Grupo Modelo S.A. de C.V. (Brewery) 323,000 790,101
Grupo Television S.A. de C.V., GDR (Entertainment)* 7,100 301,750
Kimberly-Clark de Mexico S.A. de C.V. (Forest and
Paper Products) 277,500 889,664
Organiz Soriana S.A., "B" (General Merchandise) 141,600 524,717
Pan American Beverage (Food and Beverage Products) 128,500 2,064,031
Telefonos de Mexico S.A. (Utilities - Telephone) 433,900 1,847,248
------------
$ 8,547,926
- ----------------------------------------------------------------------------------------
Netherlands - 3.1%
Akzo Nobel N.V. (Chemicals) 35,330 $ 1,520,901
Fugro N.V. (Engineering)* 53,205 1,790,243
Hunter Douglas N.V., ADR (Consumer Goods and
Services) 63,588 1,721,717
IHC Caland N.V. (Marine Equipment)* 22,990 997,177
ING Groep N.V. (Financial Services) 64,374 3,796,015
Koninklijke Ahrend Groep N.V. (Consumer Goods
and Services)* 100,438 1,378,218
Koninklijke Philips Electronics N.V. (Electronics) 26,200 2,686,058
New Holland N.V. (Agricultural Products) 1,200 18,225
STMicroelectronics N.V. ADR (Electronics) 30,050 2,638,399
STMicroelectronics N.V. (Electronics)* 3,600 327,150
Wolters Kluwer N.V. (Publishing)* 66,500 2,221,510
------------
$ 19,095,613
- ----------------------------------------------------------------------------------------
New Zealand - 0.1%
Warehouse Group (Retail) 146,000 $ 565,598
- ----------------------------------------------------------------------------------------
Philippines - 0.6%
Bank of Philippine Islands (Banks and Credit Cos.) 247,800 $ 656,670
Metro Bank & Trust Co. (Banks and Credit Cos.) 103,400 775,500
Philippine Long Distance Telephone Co.
(Utilities - Telephone) 39,800 818,387
SM Prime Holding, Inc. (Real Estate) 7,788,500 1,382,459
------------
$ 3,633,016
- ----------------------------------------------------------------------------------------
Poland - 0.2%
Agora S.A. (Entertainment)*## 20,411 $ 205,641
Bank Rozwoju Eksportu S.A. (Banks and
Credit Cos.) 7,200 196,348
Telekomunikacja Polska S.A.
(Telecommunications)## 113,680 574,084
Telekomunikacja Polska S.A., GDR
(Telecommunications) 9,200 46,460
------------
$ 1,022,533
- ----------------------------------------------------------------------------------------
Portugal - 0.5%
Banco Pinto & Sotto Mayor S.A. (Banks and
Credit Cos.) 132,311 $ 2,754,676
- ----------------------------------------------------------------------------------------
Singapore - 1.4%
Chartered Semiconductor Manufacturing Co.,
ADR (Electronics) 23,975 $ 795,671
Datacraft Asia Ltd. (Telecommunications) 470,000 2,162,000
DBS Group Holdings Ltd. (Financial Services) 366,287 4,141,325
Natsteel Electronics Ltd. (Electronics) 407,000 1,590,991
------------
$ 8,689,987
- ----------------------------------------------------------------------------------------
South Africa - 0.6%
De Beers Centenary AG (Diamonds - Precious Stones) 19,367 $ 529,393
De Beers Consolidated Mines Ltd. (Mining) 5,000 135,312
Dimension Data Holdings Ltd. (Financial
Institutions) 108,051 524,528
Imperial Holdings Ltd. (Conglomerate)* 46,873 435,232
Liberty Life Association of Africa Ltd.
(Insurance) 35,321 327,968
Nedcor Ltd. (Banks and Credit Cos.) 21,704 427,101
Sasol Ltd. (Oils) 86,180 589,630
South African Breweries Ltd. (Brewery) 65,276 572,083
South African Breweries Ltd., ADR (Brewery) 23,900 212,007
------------
$ 3,753,254
- ----------------------------------------------------------------------------------------
South Korea - 1.2%
Hanvit Bank (Banks and Credit Cos.)*## 42,900 $ 317,460
Housing & Commercial Bank of Korea (Banks
and Credit Cos.) 34,350 908,169
Kookmin Bank (Banks and Credit Cos.) 22,700 354,037
Korea Telecom Corp. (Telecommunications)* 59,400 2,093,850
LG Chemical Ltd. (Chemicals) 16,400 496,514
Pohang Iron & Steel Co. Ltd. (Construction) 9,470 1,137,348
Pohang Iron & Steel Co. Ltd., ADR
(Construction) 3,500 116,812
Samsung Corp. (Electronics) 16,500 261,468
Samsung Electronics (Electronics) 9,058 1,510,926
------------
$ 7,196,584
- ----------------------------------------------------------------------------------------
Spain - 1.1%
Cortefiel S.A. (Retail) 86,100 $ 2,247,964
Repsol S.A. (Oils) 76,300 1,572,498
Repsol S.A., ADR (Oil Services) 23,700 485,850
Telefonica Publicidad e Informacion S.A.
(Utilities - Telephone)* 1,900 41,415
Telefonica S.A. (Telecommunications)* 150,948 2,482,410
------------
$ 6,830,137
- ----------------------------------------------------------------------------------------
Sweden - 2.3%
A-Com AB (Communications)* 17,100 $ 197,652
Celsius AB (Aerospace) 146,300 2,296,228
Ericsson LM, "B" (Telecommunications) 77,400 3,220,684
Ericsson LM, ADR (Telecommunications) 57,200 2,445,300
Saab AB, "B" (Aerospace) 317,500 2,472,320
Skandia Forsakrings AB (Insurance) 139,400 3,103,808
------------
$ 13,735,992
- ----------------------------------------------------------------------------------------
Switzerland - 1.4%
Compagnie Financiere Richemont AG
(Conglomerate) 231 $ 441,444
Julius Baer Holdings (Banks and Credit Cos.) 645 1,940,757
Nestle S.A. (Food and Beverage Products) 1,699 3,278,028
UBS AG (Banks and Credit Cos.) 10,700 3,114,221
------------
$ 8,774,450
- ----------------------------------------------------------------------------------------
Taiwan - 1.1%
Advanced Semiconducor, Inc., GDR
(Electronics) 44,300 $ 886,000
ASE Test Ltd. (Electronics)* 55,800 1,395,000
Fubon Insurance Co., GDR (Insurance) 37,620 346,104
Ritek Corp. (Computer - Software Systems)* 19,950 259,350
Taipei Fund (Finance)* 238 2,130,100
Taiwan Semiconductor Manufacturing Co. Ltd.,
ADR (Electronics) 52,499 1,817,778
------------
$ 6,834,332
- ----------------------------------------------------------------------------------------
Thailand - 0.2%
Total Access Communications Public Co., Ltd.,
ADR (Telecommunications)* 360,000 $ 871,200
Thai Farmers Bank (Banks and Credit Cos.) 259,000 365,876
------------
$ 1,237,076
- ----------------------------------------------------------------------------------------
Turkey - 0.3%
Yapi ve Kredi Bankasi (Banks and Credit Cos.) 100,357,091 $ 1,461,349
Yapi ve Kredi Bankasi, GDR (Banks and
Credit Cos.) 7,990 117,453
------------
$ 1,578,802
- ----------------------------------------------------------------------------------------
United Kingdom - 5.8%
Anglo American PLC (Metals) 10,683 $ 569,068
Anglo American PLC, ADR (Metals) 2,186 116,951
Antofagasta Holdings PLC (Minerals) 26,000 178,529
ARM Holdings PLC, ADR (Computer Software
- Systems)* 41,600 3,525,600
Boots Co. PLC (Retail)* 197,600 2,027,111
BP Amoco PLC (Oils) 355,776 3,454,000
British Aerospace PLC (Aerospace)* 399,727 2,363,873
British Telecommunications PLC
(Telecommunications)* 167,965 3,046,113
Cable & Wireless Communications PLC
(Telecommunications) 122,800 1,286,996
Capital Radio PLC (Broadcasting) 80,750 1,325,153
Coca-Cola Beverages PLC (Beverages)* 300,100 576,780
COLT Telecom Group PLC (Telecommunications)* 14,600 435,779
Computacenter PLC (Computer - Services) 221,000 2,305,282
Diageo PLC (Food and Beverage Products)* 105,000 1,067,673
ICON PLC, ADR (Biotechnology)* 100 1,350
Lloyds TSB Group PLC (Banks and Credit Cos.)* 187,300 2,590,646
Next PLC (Stores) 91,813 990,141
Nycomed Amersham PLC (Medical and
Health Products) 282,600 1,736,209
Orange PLC (Telecommunications) 83,700 2,078,909
Reuters Group PLC (Business Services) 154,500 1,421,264
Tesco PLC (Retail)* 373,100 1,107,801
Zeneca Group PLC (Medical and Health Products) 62,900 2,843,526
------------
$ 35,048,754
- ----------------------------------------------------------------------------------------
Venezuela - 0.3%
Ca la Electricidad de Caracas, ADR
(Utilities - Electric) 66,700 $ 1,283,975
Mavesa S.A. (Consumer Goods and Services) 74,300 236,831
------------
$ 1,520,806
- ----------------------------------------------------------------------------------------
Total Foreign Stocks 311,550,759
- ----------------------------------------------------------------------------------------
U.S. Stocks - 40.6%
Advertising - 0.2%
Big Flower Holdings, Inc.* 500 $ 15,093
Lamar Advertising Co., "A"* 400 21,600
Omnicom Group, Inc. 1,600 140,800
Outdoor Systems, Inc.* 700 29,662
Young & Rubicam, Inc. 24,100 1,102,575
------------
$ 1,309,730
- ----------------------------------------------------------------------------------------
Airlines
Airborne Freight Corp. 400 $ 8,600
Atlas Air, Inc.* 600 16,200
Skywest, Inc. 450 11,166
------------
$ 35,966
- ----------------------------------------------------------------------------------------
Automotive
AutoNation, Inc.* 1,800 $ 18,113
Group 1 Automotive, Inc.* 600 10,050
------------
$ 28,163
- ----------------------------------------------------------------------------------------
Banks and Credit Companies
First Tennessee National Corp. 400 $ 13,600
- ----------------------------------------------------------------------------------------
Biotechnology
Guidant Corp. 2,700 $ 133,313
- ----------------------------------------------------------------------------------------
Broadcasting
Source Media, Inc.* 700 $ 5,359
Spanish Broadcasting Systems, Inc.* 1,225 32,616
Westwood One, Inc.* 500 23,062
------------
$ 61,037
- ----------------------------------------------------------------------------------------
Building
Sherwin Williams Co. 600 $ 13,425
- ----------------------------------------------------------------------------------------
Business Machines - 1.2%
Affiliated Computer Services, Inc., "A"* 400 $ 15,200
Seagate Technology, Inc.* 600 17,662
Sun Microsystems, Inc.* 46,400 4,909,700
Texas Instruments, Inc. 26,900 2,414,275
------------
$ 7,356,837
- ----------------------------------------------------------------------------------------
Business Services - 0.2%
Abacus Direct Corp.* 200 $ 29,300
Adelphia Business Solutions* 1,300 36,887
Affiliated Managers Group, Inc.* 500 13,375
Bea Systems, Inc.* 3,100 141,437
Breakaway Solutions, Inc.* 400 21,275
Building One Services Corp.* 324 3,605
Concord EFS, Inc.* 750 20,297
First Data Corp. 2,000 91,375
IMRglobal Corp.* 2,600 26,650
Insight Enterprises, Inc.* 450 16,819
Learning Tree International, Inc.* 25,100 461,212
Pegasus Systems, Inc.* 400 17,100
Predictive Systems, Inc.* 100 4,350
Professional Detailing, Inc.* 400 10,000
Tanning Technology Corp.* 700 24,588
Teletech Holdings, Inc.* 1,400 19,863
UsWeb Corp.* 500 19,375
------------
$ 957,508
- ----------------------------------------------------------------------------------------
Cellular Telephones - 0.1%
Powertel, Inc.* 3,600 $ 211,950
Telephone & Data Systems, Inc. 3,800 437,950
Triton PCS Holdings, Inc.* 1,100 38,775
------------
$ 688,675
- ----------------------------------------------------------------------------------------
Computer Hardware - Systems
Maxtor Corp.* 1,100 $ 6,050
- ----------------------------------------------------------------------------------------
Computer Software - Personal Computers - 2.9%
America Online, Inc.* 18,700 $ 2,425,156
Mercury Interactive Corp. 300 24,338
Microsoft Corp.* 160,000 14,810,000
Symantec Corp.* 6,000 286,500
------------
$ 17,545,994
- ----------------------------------------------------------------------------------------
Computer Software - Services - 0.1%
EMC Corp.* 5,800 $ 423,400
Internet Commerce Corp.* 2,800 44,100
Intertrust Technologies Corp.* 375 20,437
iXL Enterprises, Inc.* 300 12,544
Legato Systems, Inc. 200 10,750
Tecnomatix Technologies Ltd.* 2,000 43,750
------------
$ 554,981
- ----------------------------------------------------------------------------------------
Computer Software - Systems - 7.2%
Aspect Development, Inc. 400 $ 14,150
Acer, Inc. 73,200 699,060
ACT Networks, Inc.* 800 5,200
Adobe Systems, Inc. 15,000 1,049,062
Agile Software Corp.* 175 17,150
Alteon Websystems, Inc.* 250 17,938
Aspen Technology, Inc.* 500 6,375
BMC Software, Inc.* 141,637 9,091,325
Cadence Design Systems, Inc.* 69,400 1,054,012
Checkfree Holdings Corp.* 600 22,425
China Common Corp.* 100 5,288
Clarify, Inc.* 600 46,350
Computer Associates International, Inc. 87,775 4,959,287
Compuware Corp.* 112,000 3,115,000
Comverse Technology, Inc.* 11,500 1,305,250
CSG Systems International, Inc.* 4,500 154,406
Cysive, Inc.* 900 51,806
Edwards (J.D.) & Co.* 6,100 146,019
Foundry Networks, Inc.* 375 71,063
Harbinger Corp.* 1,200 19,125
I2 Technologies, Inc. 7,400 584,137
JNI Corp.* 350 18,703
Keane, Inc.* 900 21,150
Liberate Technologies* 575 39,172
Manugistics Group, Inc.* 4,200 48,300
NCR Corp.* 300 9,938
NetIQ Corp.* 375 17,133
New Era of Networks, Inc.* 3,000 97,313
Oracle Corp.* 377,160 17,938,672
Siebel Systems, Inc.* 9,500 1,043,219
Smartdisk Corp. 150 8,222
Sycamore Networks, Inc. 450 96,750
Synopsys, Inc.* 500 31,156
Vantive Corp.* 2,200 25,575
VERITAS Software Corp.* 19,200 2,071,200
------------
$ 43,900,931
- ----------------------------------------------------------------------------------------
Conglomerates - 2.3%
Tyco International Ltd. 347,800 $ 13,890,262
- ----------------------------------------------------------------------------------------
Consumer Goods and Services
Atwood Oceanics, Inc.* 500 $ 14,531
Callaway Golf Co. 1,200 16,125
Carson, Inc., "A"* 20,900 60,088
TV Guide, Inc.* 400 21,050
------------
$ 111,794
- ----------------------------------------------------------------------------------------
Containers
Owens Illinois, Inc.* 800 $ 19,150
Sealed Air Corp.* 300 16,613
Smurfit-Stone Container Corp.* 900 19,462
U.S. Can Corp.* 100 1,950
------------
$ 57,175
- ----------------------------------------------------------------------------------------
Electrical Equipment
Jabil Circuit, Inc.* 400 $ 20,900
Micrel, Inc.* 800 43,500
------------
$ 64,400
- ----------------------------------------------------------------------------------------
Electronics - 2.5%
Altera Corp.* 113,100 $ 5,499,487
Analog Devices, Inc.* 19,800 1,051,875
Applied Materials, Inc.* 8,100 727,481
Applied Micro Circuits Corp.* 800 62,250
ATMI, Inc.* 600 16,163
Burr-Brown Corp.* 600 23,587
Conexant Systems, Inc.* 12,600 1,176,525
Credence Systems Corp.* 600 27,375
E Tek Dynamics, Inc. 4,400 293,150
Electro Scientific Industries, Inc.* 400 21,600
Flextronics International Ltd.* 360 25,560
Intel Corp. 23,700 1,835,269
Linear Technology Corp. 3,300 230,794
LTX Corp.* 1,400 22,138
Maxim Integrated Products, Inc.* 300 23,681
Microchip Technology, Inc.* 400 26,650
MIPS Technologies, Inc.* 400 11,550
Novellus Systems, Inc.* 7,300 565,750
Optical Coating Laboratory, Inc. 300 32,062
Photronics, Inc.* 600 12,563
Quanta Services, Inc.* 600 16,725
Sanmina Corp.* 300 27,019
SDL, Inc.* 4,500 554,906
SIPEX Corp.* 3,000 34,500
Solectron Corp.* 1,600 120,400
Xilinx, Inc.* 31,800 2,500,275
------------
$ 14,939,335
- ----------------------------------------------------------------------------------------
Entertainment - 2.4%
Acme Communications, Inc.* 375 $ 13,500
CBS Corp.* 39,000 1,903,687
Clear Channel Communications, Inc.* 53,217 4,277,316
Comcast Corp., "A" 13,400 564,475
Cox Radio, Inc., "A"* 43,500 3,045,000
Emmis Broadcasting Corp., "A"* 3,900 281,288
Harrah's Entertainment, Inc.* 800 23,150
Hearst-Argyle Television, Inc.* 600 12,188
Infinity Broadcasting Corp.* 4,900 169,356
International Speedway Corp. 821 42,384
Macromedia, Inc.* 11,900 766,806
Premier Parks, Inc.* 700 20,256
Radio Unica Communications Co.* 625 17,891
Time Warner, Inc. 42,900 2,989,594
Tivo, Inc.* 25 1,072
Univision Communications, Inc., "A"* 5,700 484,856
USA Networks, Inc.* 700 31,544
------------
14,644,363
- ----------------------------------------------------------------------------------------
Finance
R.O.C. Taiwan Fund* 28,400 $ 218,325
- ----------------------------------------------------------------------------------------
Financial Institutions - 0.4%
American Express Co. 6,900 $ 1,062,600
CIT Group, Inc., "A" 400 9,550
Citigroup, Inc. 12,900 698,212
Hambrecht & Quist Group, Inc.* 500 24,688
Lehman Brothers Holdings, Inc. 7,600 560,025
Paine Webber Group, Inc. 300 12,225
Waddell & Reed Financial, Inc., "A" 600 14,400
------------
$ 2,381,700
- ----------------------------------------------------------------------------------------
Forest and Paper Products - 0.2%
Bowater, Inc. 600 $ 31,500
Jefferson Smurfit Corp. 493,200 1,285,188
------------
$ 1,316,688
- ----------------------------------------------------------------------------------------
Internet - 0.1%
Akamai Technologies, Inc.* 525 $ 76,223
Data Return Corp.* 650 9,791
Digital Insight Corp.* 500 19,813
Hoover's, Inc.* 200 2,025
Internap Network Services Corp.* 1,075 99,303
Keynote Systems, Inc.* 325 14,747
Satyam Infoway Ltd.* 1,400 54,250
Talk.com, Inc.* 3,400 54,187
VeriSign, Inc.* 1,300 160,550
Women.com Networks, Inc. 1,150 20,700
------------
$ 511,589
- ----------------------------------------------------------------------------------------
Leisure
Speedway Motorsports, Inc.* 400 $ 17,450
- ----------------------------------------------------------------------------------------
Machinery
SI Handling Systems, Inc. 19,050 $ 152,400
- ----------------------------------------------------------------------------------------
Medical and Health Products - 0.5%
Biomatrix, Inc.* 400 $ 9,075
C.R. Bard, Inc. 300 16,181
Johnson & Johnson Co. 958 100,350
King Pharmaceuticals, Inc.* 1,400 42,350
Pharmacia & Upjohn, Inc. 50,500 2,723,844
Respironics, Inc.* 1,000 8,438
The Liposome, Inc.* 1,200 9,450
------------
$ 2,909,688
- ----------------------------------------------------------------------------------------
Medical and Health Technology and Services - 1.1%
Affymetrix, Inc.* 2,600 $ 229,125
Allscripts, Inc.* 800 12,500
Alpharma, Inc. 400 14,075
Biogen, Inc.* 12,300 911,737
Cyberonics, Inc.* 100 1,406
Enzon, Inc.* 1,200 35,175
Genentech, Inc.* 8,700 1,268,025
Henry Schein, Inc.* 300 3,900
Human Genome Sciences, Inc.* 3,600 314,550
IDEXX Laboratories, Inc.* 700 10,588
ImClone Systems, Inc.* 700 19,513
Medimmune, Inc.* 27,600 3,091,200
PE Corp. 5,900 382,762
Province Healthcare Co.* 400 6,450
Ranbaxy Laboratories Ltd. 22,100 433,160
Transkaryotic Therapies, Inc.* 500 23,250
United Healthcare Corp. 1,700 87,869
------------
$ 6,845,285
- ----------------------------------------------------------------------------------------
Metal Fabrication
The Timken Co. 900 $ 16,144
- ----------------------------------------------------------------------------------------
Metals and Minerals
Phelps Dodge Corp. 156 $ 8,795
- ----------------------------------------------------------------------------------------
Office Equipment
Boise Cascade Office Products Corp.* 900 $ 9,225
United Stationers, Inc.* 800 20,400
------------
$ 29,625
- ----------------------------------------------------------------------------------------
Oils - 0.6%
Atlantic Richfield Co. 36,000 $ 3,354,750
- ----------------------------------------------------------------------------------------
Pharmaceuticals - 0.1%
Andrx Corp.* 400 $ 19,100
Sepracor, Inc.* 9,800 815,237
------------
$ 834,337
- ----------------------------------------------------------------------------------------
Photographic Products - 0.1%
Polaroid Corp. 16,500 $ 368,156
- ----------------------------------------------------------------------------------------
Printing and Publishing - 0.3%
Electronics for Imaging, Inc.* 500 $ 20,156
Times Mirror Co., "A" 200 14,425
Tribune Co. 30,300 1,818,000
------------
$ 1,852,581
- ----------------------------------------------------------------------------------------
Restaurants and Lodging - 0.5%
Brinker International, Inc.* 700 $ 16,319
CEC Entertainment, Inc.* 750 24,047
Cendant Corp.* 159,549 2,632,558
Four Seasons Hotels, Inc. 400 16,675
IHOP Corp.* 600 10,838
Papa John's International, Inc.* 400 14,950
Promus Hotel Corp.* 861 29,489
Starwood Hotels & Resorts Co. 500 11,469
------------
$ 2,756,345
- ----------------------------------------------------------------------------------------
Retail - 0.1%
Lands End, Inc.* 1,300 $ 100,019
Quiksilver, Inc.* 600 8,475
Tandy Corp. 10,900 686,018
Tommy Hilfiger Corp.* 400 11,300
------------
$ 805,812
- ----------------------------------------------------------------------------------------
Special Products and Services
Harmonic Lightwaves, Inc.* 2,100 $ 124,687
Millipore Corp. 400 12,750
Newport News Shipbuilding, Inc. 100 3,038
------------
$ 140,475
- ----------------------------------------------------------------------------------------
Stores - 0.9%
Consolidated Stores Corp.* 425 $ 7,783
Cost Plus, Inc.* 600 21,900
CSK Auto Corp.* 500 8,938
Home Depot, Inc. 26,400 1,993,200
Office Depot, Inc.* 75,100 934,056
Wal-Mart Stores, Inc. 48,400 2,743,675
------------
$ 5,709,552
- ----------------------------------------------------------------------------------------
Technology
National Semiconductor Corp.* 1,500 $ 44,906
- ----------------------------------------------------------------------------------------
Telecommunications - 16.1%
Aerial Communications, Inc.* 2,100 $ 89,250
AirGate PCS, Inc.* 675 33,750
Alltel Corp. 10,800 899,100
Amdocs Ltd.* 1,100 30,594
AT&T Corp.* 77,900 3,091,657
Aware, Inc.* 400 12,725
Centinal Cellular Corp.* 400 22,050
CIENA Corp.* 16,700 588,675
Cisco Systems, Inc.* 280,700 20,771,800
CommNet Cellular, Inc.* 800 25,250
CommScope, Inc.* 2,500 99,688
Copper Mountain Networks, Inc.* 300 22,125
Corning, Inc. 5,400 424,575
Cox Communications, Inc.* 2,031 92,284
Critical Path, Inc.* 100 4,575
EchoStar Communications, Corp.* 4,400 272,250
Firstcom Corp.* 23,200 256,650
Global TeleSystems Group, Inc.* 73,124 1,750,406
International Business Communications
Systems, Inc.*+ 40,300 0
International Telecommunication Data
Systems, Inc.* 1,900 18,881
ITC Deltacom, Inc.* 900 21,600
JDS Uniphase Corp.* 40,725 6,795,984
Level 3 Communications, Inc.* 27,200 1,859,800
Lucent Technologies, Inc. 2,400 154,200
MCI WorldCom, Inc.* 162,517 13,945,990
Metricom, Inc.* 700 30,756
Metromedia Fiber Network, Inc., "A"* 7,700 254,581
Motorola, Inc. 17,500 1,705,156
NEXTEL Communications, Inc.* 51,200 4,412,800
Nortel Networks Corp. 99,200 6,144,200
Omnipoint Corp.* 42,000 3,470,250
Partner Communications Co. Ltd.* 99,475 1,566,731
Powerwave Technologies, Inc.* 600 39,038
Premiere Technologies, Inc.* 1,200 6,600
Price Communications Corp. 800 17,400
QUALCOMM, Inc.* 62,250 13,866,187
Qwest Communications International, Inc.* 57,500 2,070,000
RF Micro Devices, Inc.* 3,200 165,200
Sprint Corp.* 13,900 1,032,944
Sprint Corp. (PCS Group)* 59,800 4,959,662
Talk Common, Inc.* 170 0
Time Warner Telecom, Inc.* 800 20,150
U.S. Cellular Corp.* 400 35,400
Voicestream Wireless Corp.* 49,300 4,868,375
Western Wireless Corp.* 33,500 1,771,313
Tekelec Co.* 3,300 41,869
------------
$ 97,762,471
- ----------------------------------------------------------------------------------------
Utilities - Electric - 0.4%
Calpine Corp.* 41,200 $ 2,374,150
- ----------------------------------------------------------------------------------------
Total U.S. Stocks $246,724,763
- ----------------------------------------------------------------------------------------
Total Stocks (Identified Cost, $417,837,553) $558,275,522
- ----------------------------------------------------------------------------------------
Short-Term Obligations - 11.7%
- ----------------------------------------------------------------------------------------
PRINCIPAL AMOUNT
(000 OMITTED)
- ----------------------------------------------------------------------------------------
Federal Home Loan Bank Corp., due 11/01/99 $ 25,700 $ 25,700,000
Federal Home Loan Mortgage Corp.,
due 11/04/99 - 11/30/99 32,800 32,702,698
Federal Home Loan Mortgage Discount Notes,
due 12/09/99 12,800 12,729,607
- ----------------------------------------------------------------------------------------
Total Short-Term Obligations, at Amortized Cost $ 71,132,305
- ----------------------------------------------------------------------------------------
Other Short-Term Obligations - 11.6%
- ----------------------------------------------------------------------------------------
SHARES
- ----------------------------------------------------------------------------------------
Navigator Securities Lending Prime Portfolio
(Identified Cost, $70,683,644) 70,683,644 $ 70,683,644
- ----------------------------------------------------------------------------------------
Total Investments (Identified Cost, $559,653,502) $700,091,471
Other Assets, Less Liabilities - (15.0)% (91,380,402)
- ----------------------------------------------------------------------------------------
Net Assets - 100.0% $608,711,069
- ----------------------------------------------------------------------------------------
* Non-income producing security.
## SEC Rule 144A restriction.
+ Restricted security.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
- --------------------------------------------------------------------------
OCTOBER 31, 1999
- --------------------------------------------------------------------------
Assets:
Investments, at value (identified cost, $559,653,502) $700,091,471
Foreign currency, at value (identified cost, $1,022,725) 1,085,637
Cash 126,390
Receivable for Fund shares sold 2,173,786
Receivable for investments sold 14,705,882
Dividends and interest receivable 773,371
Other assets 5,456
-------------
Total assets $ 718,961,993
-------------
Liabilities:
Payable for Fund shares reacquired $ 1,114,553
Payable for investments purchased 38,097,195
Collateral for securities loaned, at value 70,683,644
Payable to affiliates -
Management fee 43,452
Shareholder servicing agent fee 4,828
Distribution and service fee 33,384
Administrative fee 724
Accrued expenses and other liabilities 273,144
-------------
Total liabilities $ 110,250,924
-------------
Net assets $ 608,711,069
=============
Net assets consist of:
Paid-in capital $ 424,412,916
Unrealized appreciation on investments and translation of
assets and liabilities in foreign currencies 140,447,013
Accumulated undistributed net realized gain on
investments and foreign currency transactions 44,652,477
Accumulated net investment loss (801,337)
-------------
Total $ 608,711,069
=============
Shares of beneficial interest outstanding 26,557,159
==========
Class A shares:
Net asset value per share
(net assets of $244,777,115 / 10,552,330 shares of
beneficial interest outstanding) $23.20
======
Offering price per share (100 / 94.25 of net asset value
per share) $24.62
======
Class B shares:
Net asset value and offering price per share
(net assets $330,541,670 / 14,539,302 shares of
beneficial interest outstanding) $22.73
======
Class C shares:
Net asset value and offering price per share
(net assets of $26,120,556 / 1,153,841 shares of
beneficial interest outstanding) $22.64
======
Class I shares:
Net asset value, offering price, and redemption price per share
(net assets of $7,271,728 / 311,686 shares of
beneficial interest outstanding) $23.33
======
On sales of $50,000 or more, the offering price of Class A shares is reduced. A
contingent deferred sales charge may be imposed on redemptions of Class A, Class
B, and Class C shares.
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
Statement of Operations
- ------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999
- ------------------------------------------------------------------------------
Net investment income (loss):
Income -
Dividends $ 5,441,752
Interest 1,684,124
Foreign taxes withheld (526,233)
------------
Total investment income $ 6,599,643
------------
Expenses -
Management fee $ 4,816,008
Trustees' compensation 42,531
Shareholder servicing agent fee 561,865
Distribution and service fee (Class A) 758,295
Distribution and service fee (Class B) 2,895,793
Distribution and service fee (Class C) 222,375
Administrative fee 67,892
Custodian fee 481,513
Printing 62,810
Postage 87,321
Auditing fees 44,326
Legal fees 4,384
Amortization of organization expenses 703
Miscellaneous 408,369
------------
Total expenses $ 10,454,185
Fees paid indirectly (54,804)
Reduction of expenses by distributor (215,922)
------------
Net expenses $ 10,183,459
------------
Net investment loss $ (3,583,816)
------------
Realized and unrealized gain (loss) on investments:
Realized gain (loss) (identified cost basis) -
Investment transactions $ 65,789,122
Foreign currency transactions (690,401)
------------
Net realized gain on investments and foreign
currency transactions $ 65,098,721
------------
Change in unrealized appreciation (depreciation) -
Investments $110,873,713
Translation of assets and liabilities in foreign
currencies (13,040)
------------
Net unrealized gain on investments and foreign
currency translation $110,860,673
------------
Net realized and unrealized gain on investments
and foreign currency $175,959,394
------------
Increase in net assets from operations $172,375,578
============
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999 1998
- --------------------------------------------------------------------------------------------
<S> <C> <C>
Increase (decrease) in net assets:
From operations -
Net investment loss $ (3,583,816) $ (2,765,182)
Net realized gain on investments and foreign currency
transactions 65,098,721 39,910,660
Net unrealized gain (loss) on investments and foreign
currency translation 110,860,673 (40,266,319)
------------- -------------
Increase (decrease) in net assets from operations $ 172,375,578 $ (3,120,841)
------------- -------------
Distributions declared to shareholders -
From net realized gain on investments and foreign
currency transactions (Class A) $ (16,259,953) $ (20,053,104)
From net realized gain on investments and foreign
currency transactions (Class B) (22,605,139) (28,720,424)
From net realized gain on investments and foreign
currency transactions (Class C) (1,663,777) (2,097,140)
From net realized gain on investments and foreign
currency transactions (Class I) (471,404) (638,217)
------------- -------------
Total distributions declared to shareholders $ (41,000,273) $ (51,508,885)
------------- -------------
Net decrease in net assets from Fund share transactions $ (1,797,176) $ (11,059,613)
------------- -------------
Total increase (decrease) in net assets $ 129,578,129 $ (65,689,339)
Net assets:
At beginning of period 479,132,940 544,822,279
------------- -------------
At end of period (including accumulated net investment loss
of $801,337 and $33,619, respectively) $ 608,711,069 $ 479,132,940
============= =============
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
CLASS A
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per share data (for a share outstanding throughout each period):
Net asset value - beginning of period $18.27 $20.79 $19.09 $18.16 $17.45
------ ------ ------ ------ ------
Income from investment operations# -
Net investment loss(S) $
$(0.05) $(0.01) $(0.02) $(0.07) --
Net realized and unrealized gain (loss)
on investments and foreign currency 6.59 (0.41) 2.77 2.73 0.93
------ ------ ------ ------ ------
Total from investment operations $ 6.54 $(0.42) $ 2.75 $ 2.66 $ 0.93
------ ------ ------ ------ ------
Less distributions declared to shareholders -
From net investment income $ -- $ -- $ -- $(0.01) $ --
From net realized gain on investments
and foreign currency transactions (1.61) (2.10) (1.05) (1.72) (0.22)
------ ------ ------ ------ ------
Total distributions declared to
shareholders $(1.61) $(2.10) $(1.05) $(1.73) $(0.22)
------ ------ ------ ------ ------
Net asset value - end of period $23.20 $18.27 $20.79 $19.09 $18.16
====== ====== ====== ====== ======
Total return(+) 38.13% (1.99)% 15.17% 15.73% 5.47%
Ratios (to average net assets)/Supplemental data(S):
Expenses## 1.48% 1.49% 1.52% 1.58% 1.63%
Net investment (income) loss (0.23)% (0.06)% (0.10)% (0.35)% 0.02%
Portfolio turnover 146% 104% 133% 95% 149%
Net assets at end of period (000 Omitted) $244,777 $195,194 $204,918 $172,106 $143,543
(S) The distributor voluntarily waived its fee for the periods indicated.
If the fee had been incurred by the Fund, the net investment loss per share and the ratios would have been:
Net investment loss $(0.07) $(0.03) $(0.04) $(0.09) $ --
Ratios (to average net assets):
Expenses## 1.58% 1.59% 1.62% 1.68% 1.73%
Net investment loss (0.33)% (0.16)% (0.20)% (0.45)% (0.08)%
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from certain expense offset arrangements.
(+) Total returns for Class A shares do not include the applicable sales charge. If the charge had been included, the results
would have been lower.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
CLASS B
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per share data (for a share outstanding throughout each period):
Net asset value - beginning of period $18.06 $20.56 $18.87 $17.97 $17.32
------ ------ ------ ------ ------
Income from investment operations# -
Net investment loss $(0.20) $(0.16) $(0.17) $(0.21) $(0.14)
Net realized and unrealized gain on
investments and foreign currency 6.48 (0.40) 2.76 2.70 0.92
------ ------ ------ ------ ------
Total from investment operations $ 6.28 $(0.56) $ 2.59 $ 2.49 $ 0.78
------ ------ ------ ------ ------
Less distributions declared to
shareholders from net realized gain on
investments and foreign currency
transactions $(1.61) $(1.94) $(0.90) $(1.59) $(0.13)
------ ------ ------ ------ ------
Net asset value - end of period $22.73 $18.06 $20.56 $18.87 $17.97
====== ====== ====== ====== ======
Total return 37.12% (2.70)% 14.30% 14.77% 4.61%
Ratios (to average net assets)/Supplemental data:
Expenses## 2.23% 2.24% 2.28% 2.39% 2.45%
Net investment loss (0.99)% (0.81)% (0.87)% (1.16)% (0.80)%
Portfolio turnover 146% 104% 133% 95% 149%
Net assets at end of period (000 Omitted) $330,542 $259,345 $308,692 $282,668 $247,437
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from certain expense offset arrangments.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
CLASS C
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per share data (for a share outstanding throughout each period):
Net asset value - beginning of period $17.99 $20.49 $18.85 $17.96 $17.34
------ ------ ------ ------ ------
Income from investment operations# -
Net investment loss $(0.20) $(0.16) $(0.17) $(0.20) $(0.13)
Net realized and unrealized gain (loss) on
investments and foreign currency 6.46 (0.40) 2.75 2.70 0.92
------ ------ ------ ------ ------
Total from investment operations $ 6.26 $(0.56) $ 2.58 $ 2.50 $ 0.79
------ ------ ------ ------ ------
Less distributions declared to shareholders
from net realized gain on investments and
foreign currency transactions $(1.61) $(1.94) $(0.94) $(1.61) $(0.17)
------ ------ ------ ------ ------
Net asset value - end of period $22.64 $17.99 $20.49 $18.85 $17.96
====== ====== ====== ====== ======
Total return 37.15% (2.73)% 14.27% 14.88% 4.68%
Ratios (to average net assets)/Supplemental data:
Expenses## 2.23% 2.24% 2.25% 2.32% 2.38%
Net investment loss (0.99)% (0.83)% (0.85)% (1.10)% (0.72)%
Portfolio turnover 146% 104% 133% 95% 149%
Net assets at end of period (000 Omitted) $26,120 $19,149 $24,662 $19,994 $13,349
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from certain expense offset arrangements.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- -------------------------------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, PERIOD ENDED
------------------------------ OCTOBER 31,
1999 1998 1997*
- -------------------------------------------------------------------------------------------------------------------------
CLASS I
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per share data (for a share outstanding throughout each period):
Net asset value - beginning of period $18.32 $20.84 $18.34
------ ------ ------
Income from investment operations# -
Net investment income $ -- $ 0.04 $ 0.04
Net realized and unrealized gain (loss) on investments and
foreign currency 6.62 (0.40) 2.46
------ ------ ------
Total from investment operations $ 6.62 $(0.36) $ 2.50
------ ------ ------
Less distributions declared to shareholders from net realized
gain (loss) on investments and foreign currency transactions $(1.61) $(2.16) $ --
------ ------ ------
Net asset value - end of period $23.33 $18.32 $20.84
====== ====== ======
Total return 38.55% (1.64)% 13.58%++
Ratios (to average net assets)/Supplemental data:
Expenses## 1.23% 1.24% 1.21%+
Net investment income (loss) 0.01% 0.19% 0.20%+
Portfolio turnover 146% 104% 133%
Net assets at end of period (000 Omitted) $7,272 $5,445 $6,550
* For the period from the inception of Class I, January 2, 1997, through October 31, 1997.
+ Annualized.
++ Not annualized.
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from certain expense offset arrangements.
</TABLE>
See notes to financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(1) Business and Organization
MFS Global Growth Fund (the Fund) is a nondiversified series of MFS Series Trust
VIII (the Trust). The Trust is organized as a Massachusetts business trust and
is registered under the Investment Company Act of 1940, as amended, as an
open-end management investment company.
(2) Significant Accounting Policies
General - 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
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. The fund can
invest in foreign securities. Investments in foreign securities are vulnerable
to the effects of changes in the relative values of the local currency and the
U.S. dollar and to the effects of changes in each country's legal, political,
and economic environment.
Investment Valuations - Equity securities listed on securities exchanges or
reported through the NASDAQ system are reported at market value using last sale
prices. Unlisted equity securities or listed equity securities for which last
sale prices are not available are reported at market value using last quoted bid
prices. Short-term obligations, which mature in 60 days or less, are valued at
amortized cost, which approximates market value. Securities for which there are
no such quotations or valuations are valued in good faith by the Trustees.
Foreign Currency Translation - Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are converted each
business day into U.S. dollars based upon current exchange rates. Purchases and
sales of foreign investments, income, and expenses are converted into U.S.
dollars based upon currency exchange rates prevailing on the respective dates of
such transactions. Gains and losses attributable to foreign currency exchange
rates on sales of securities are recorded for financial statement purposes as
net realized gains and losses on investments. Gains and losses attributable to
foreign exchange rate movements on income and expenses are recorded for
financial statement purposes as foreign currency transaction gains and losses.
That portion of both realized and unrealized gains and losses on investments
that results from fluctuations in foreign currency exchange rates is not
separately disclosed.
Deferred Organization Expenses - Costs incurred by the Fund in connection with
its organization were deferred and amortized on a straight-line basis over a
five-year period beginning on the date of commencement of Fund operations.
Security Loans - State Street Bank and Trust Company ("State Street"), as agent,
may loan the securities of the Fund to certain brokers (the "Borrowers")
approved by the Fund. The loans are collateralized at all times by cash and/or
U.S. Treasury securities in an amount at least equal to the market value of the
securities loaned. State Street provides the Fund with indemnification against
Borrower default. The Fund bears the risk of loss with respect to the investment
of cash collateral.
At October 31, 1999, the value of securities loaned was $69,150,009. These loans
were collateralized by cash of $70,683,644 and U.S. Treasury securities of
$1,009,690. Cash collateral is invested in short-term securities, which are
included in the Portfolio of Investments. A portion of the income generated upon
investment of the collateral is remitted to the Borrowers, and the remainder is
allocated between the Fund and State Street in its capacity as lending agent. On
loans collateralized by U.S. Treasury securities, a fee is received from the
Borrower, and is allocated between the Fund and State Street. Income from
securities lending is included in interest income on the Statement of
Operations. The dividend and interest income earned on the securities loaned is
accounted for in the same manner as other dividend and interest income.
Investment Transactions and Income - Investment transactions are recorded on the
trade date. Interest income is recorded on the accrual basis. All discount is
accreted for financial statement and tax reporting purposes as required by
federal income tax regulations. Dividends received in cash are recorded on the
ex-dividend date. Dividend payments received in additional securities are
recorded on the ex-dividend in an amount equal to the value of the security on
such date.
Fees Paid Indirectly - The Fund's custody fee is calculated as a percentage of
the Fund's month end net assets. The fee is reduced according to an arrangement
that measures the value of cash deposited with the custodian by the Fund. This
amount is shown as a reduction of expenses on the Statement of Operations.
Tax Matters and Distributions - The Fund's policy is to comply with the
provisions of the Internal Revenue Code (the Code) applicable to regulated
investment companies and to distribute to shareholders all of its taxable
income, including any net realized gain on investments. Accordingly, no
provision for federal income or excise tax is provided.
Distributions to shareholders are recorded on the ex-dividend date. The Fund
distinguishes between distributions on a tax basis and a financial reporting
basis and requires that only distributions in excess of tax basis earnings and
profits be reported in the financial statements as distributions from paid-in
capital. Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or net realized gains. During
the year ended October 31, 1999, $2,816,098 and $13,523,164 were reclassified to
accumulated net investment loss and paid-in capital, respectively, from
accumulated undistributed net realized gain on investments and foreign currency
transactions due to differences between book and tax accounting for currency
transactions, dividends, and the offset of net investment loss against
short-term capital gains. This change had no effect on the net assets or net
asset value per share.
Multiple Classes of Shares of Beneficial Interest - The Fund offers multiple
classes of shares, which differ in their respective distribution and service
fees. All shareholders bear the common expenses of the Fund based on daily net
assets of each class, without distinction between share classes. Dividends are
declared separately for each class. Differences in per share dividend rates are
generally due to differences in separate class expenses. Class B shares will
convert to Class A shares approximately eight years after purchase.
(3) Transactions with Affiliates
Investment Adviser - The Fund has an investment advisory agreement with
Massachusetts Financial Services Company (MFS) to provide overall investment
advisory and administrative services, and general office facilities. The
management fee is computed daily and paid monthly at the following annual rates:
First $1 billion of average net assets 0.90%
Average net assets in excess of $1 billion 0.75%
The advisory agreement permits the adviser to engage one or more sub-advisers;
through August 31, 1999, the adviser engaged Foreign & Colonial Management Ltd.
("FCM") and its subsidiary Foreign & Colonial Emerging Markets Ltd. ("FCEM"),
each an England and Wales Company, to manage the assets of the Fund invested in
foreign emerging market securities. Effective September 1, 1999, MFS assumed all
portfolio management responsibilities for emerging market securities from FCM
and FCEM for the Fund, and the sub-investment advisory agreements pursuant to
which FCM and FCEM provided their services were terminated.
The Fund pays no compensation directly to its Trustees who are officers of the
investment adviser, or to officers of the Fund, all of whom receive remuneration
for their services to the Fund from MFS. Certain officers and Trustees of the
Fund are officers or directors of MFS, MFS Fund Distributors, Inc. (MFD) and MFS
Service Center, Inc. (MFSC). The Fund has an unfunded defined benefit plan for
all of its independent Trustees and Mr. Bailey. Included in Trustees'
compensation is a net periodic pension expense of $12,014 for the year ended
October 31, 1999.
Administrator - The Fund has an administrative services agreement with MFS to
provide the Fund with certain financial, legal, shareholder servicing,
compliance, and other administrative services. As a partial reimbursement for
the cost of providing these services, the Fund pays MFS an administrative fee at
the following annual percentages of the Fund's average daily net assets:
First $1 billion 0.0150%
Next $1 billion 0.0125%
Next $1 billion 0.0100%
In excess of $3 billion 0.0000%
Distributor - MFD, a wholly owned subsidiary of MFS, as distributor, received
$69,753 for the year ended October 31, 1999, as its portion of the sales charge
on sales of Class A shares of the Fund.
The Trustees have adopted a distribution plan for Class A, Class B, and Class C
shares pursuant to Rule 12b-1 of the Investment Company Act of 1940 as follows:
The Fund's distribution plan provides that the Fund will pay MFD up to 0.35% per
annum of its average daily net assets attributable to Class A shares in order
that MFD may pay expenses on behalf of the Fund related to the distribution and
servicing of its shares. These expenses include a service fee paid to each
securities dealer that enters into a sales agreement with MFD of up to 0.25% per
annum of the Fund's average daily net assets attributable to Class A shares
which are attributable to that securities dealer and a distribution fee to MFD
of up to 0.10% per annum of the Fund's average daily net assets attributable to
Class A shares. MFD retains the service fee for accounts not attributable to a
securities dealer, which amounted to $40,080 for the year ended October 31,
1999. The Class A distribution fee is currently being waived on a voluntary
basis and may be imposed at the discretion of MFD. Fees incurred under the
distribution plan during the year ended October 31, 1999, were 0.25% of average
daily net assets attributable to Class A shares on an annualized basis.
The Fund's distribution plan provides that the Fund will pay MFD a distribution
fee of 0.75% per annum, and a service fee of up to 0.25% per annum, of the
Fund's average daily net assets attributable to Class B and Class C shares. MFD
will pay to securities dealers that enter into a sales agreement with MFD all or
a portion of the service fee attributable to Class B and Class C shares, and
will pay to such securities dealers all of the distribution fee attributable to
Class C shares. The service fee is intended to be consideration for services
rendered by the dealer with respect to Class B and Class C shares. MFD retains
the service fee for accounts not attributable to a securities dealer, which
amounted to $20,392 and $242 for Class B and Class C shares, respectively, for
the year ended October 31, 1999. Fees incurred under the distribution plan
during the year ended October 31, 1999, were 1.00% of average daily net assets
attributable to Class B and Class C shares on an annualized basis.
Certain Class A and Class C shares are subject to a contingent deferred sales
charge in the event of a shareholder redemption within 12 months following
purchase. A contingent deferred sales charge is imposed on shareholder
redemptions of Class B shares in the event of a shareholder redemption within
six years of purchase. MFD receives all contingent deferred sales charges.
Contingent deferred sales charges imposed during the year ended October 31,
1999, were $5,196, $364,547, and $3,659 for Class A, Class B, and Class C
shares, respectively.
Shareholder Servicing Agent - MFSC, a wholly owned subsidiary of MFS, earns a
fee for its services as shareholder servicing agent. The fee is calculated as a
percentage of the Fund's average daily net assets at an annual rate of 0.10%.
Prior to April 1, 1999, the fee was calculated as a percentage of the Fund's
average daily net assets at an annual rate of 0.1125%.
(4) Portfolio Securities
Purchases and sales of investments, other than U.S. government securities,
purchased option transactions, and short-term obligations, aggregated
$733,474,325 and $806,847,283, respectively.
The cost and unrealized appreciation and depreciation in the value of the
investments owned by the Fund, as computed on a federal income tax basis, are as
follows:
Aggregate cost $564,574,629
------------
Gross unrealized appreciation $147,744,202
Gross unrealized depreciation (12,227,360)
------------
Net unrealized appreciation $135,516,842
============
(5) Shares of Beneficial Interest
The Fund's Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest. Transactions in
Fund shares were
as follows:
<TABLE>
<CAPTION>
Class A Shares
YEAR ENDED OCTOBER 31, 1999 YEAR ENDED OCTOBER 31, 1998
---------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 47,525,247 $ 966,767,986 59,000,914 $ 1,171,149,285
Shares issued to shareholders
in reinvestment of
distributions 836,303 15,402,364 967,119 17,570,051
Shares reacquired (48,494,561) (989,104,678) (59,138,361) (1,181,723,918)
--------------- --------------- --------------- ---------------
Net increase (decrease) (133,011) $ (6,934,328) 829,672 $ 6,955,418
=============== =============== =============== ===============
<CAPTION>
Class B Shares
YEAR ENDED OCTOBER 31, 1999 YEAR ENDED OCTOBER 31, 1998
---------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 2,782,026 $ 57,830,751 2,457,348 $ 47,943,310
Shares issued to shareholders
in reinvestment of
distributions 987,616 17,849,062 1,230,304 22,182,930
Shares reacquired (3,591,842) (72,391,978) (4,343,624) (84,629,146)
--------------- --------------- --------------- ---------------
Net increase (decrease) 177,800 $ 3,287,835 (655,972) $ (14,502,906)
=============== =============== =============== ===============
<CAPTION>
Class C Shares
YEAR ENDED OCTOBER 31, 1999 YEAR ENDED OCTOBER 31, 1998
---------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 3,132,092 $ 63,131,555 2,032,301 $ 39,976,080
Shares issued to shareholders
in reinvestment of
distributions 65,363 1,176,528 78,016 1,401,164
Shares reacquired (3,107,998) (62,729,730) (2,249,822) (44,495,696)
--------------- --------------- --------------- ---------------
Net increase (decrease) 89,457 $ 1,578,353 (139,505) $ (3,118,452)
=============== =============== =============== ===============
<CAPTION>
Class I Shares
YEAR ENDED OCTOBER 31, 1999 YEAR ENDED OCTOBER 31, 1998
---------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 46,819 $ 980,650 54,528 $ 1,091,358
Shares issued to shareholders
in reinvestment of
distributions 25,647 471,399 35,224 638,251
Shares reacquired (57,985) (1,181,085) (106,903) (2,163,282)
--------------- --------------- --------------- ---------------
Net increase (decrease) 14,481 $ 270,964 (17,151) $ (433,673)
=============== =============== =============== ===============
</TABLE>
(6) Line of Credit
The Fund and other affiliated funds participate in an $820 million unsecured
line of credit provided by a syndication of banks under a line of credit
agreement. Borrowings may be made to temporarily finance the repurchase of Fund
shares. Interest is charged to each fund, based on its borrowings, at a rate
equal to the bank's base rate. In addition, a commitment fee, based on the
average daily unused portion of the line of credit, is allocated among the
participating funds at the end of each quarter. The commitment fee allocated to
the Fund for the year ended October 31, 1999, was $3,698.
(7) Restricted Securities
The Fund may invest not more than 15% of its net assets in securities which are
subject to legal or contractual restrictions on resale. At October 31, 1999, the
Fund owned the following restricted securities, excluding securities issued
under Rule 144A, constituting 0.25% of net assets which may not be publicly sold
without registration under the Securities Act of 1933. The Fund does not have
the right to demand that such securities be registered. The value of these
securities is determined by valuations furnished by dealers or by a pricing
service, or if not available, in good faith by the Trustees.
<TABLE>
<CAPTION>
DATE OF
DESCRIPTION ACQUISITION SHARE AMOUNT COST VALUE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
International Business
Communications Systems, Inc. 8/29/95 40,300 $399,776 $ --
Malayan Banking Berhad 5/24/99 91,000 249,437 293,475
Malaysian Pacific Industries Berhad 10/13/99 82,000 286,001 338,250
Resorts World Berhad 11/26/93 116,000 236,602 316,100
Sime Darby Berhad 5/24/99 250,000 302,978 283,750
Telekom Malaysia Berhad 5/24/99 102,000 330,254 298,350
----------
$1,529,925
==========
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Trustees of the MFS Series Trust VIII and Shareholders of MFS Global
Growth Fund:
We have audited the accompanying statement of assets and liabilities of MFS
Global Growth Fund (the "Fund") including the schedule of investments, as of
October 31, 1999, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1999, by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of MFS
Global Growth Fund as of October 31, 1999, the results of its operations for the
year then ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended, in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
December 9, 1999
<PAGE>
- --------------------------------------------------------------------------------
FEDERAL TAX INFORMATION
- --------------------------------------------------------------------------------
IN JANUARY 2000, SHAREHOLDERS WILL BE MAILED A FORM 1099-DIV REPORTING THE
FEDERAL TAX STATUS OF ALL DISTRIBUTIONS PAID DURING THE CALENDAR YEAR 1999.
THE FUND HAS DESIGNATED $54,568,577 AS A CAPITAL GAIN DIVIDEND FOR THE YEAR
ENDED OCTOBER 31, 1999.
FOR THE YEAR ENDED OCTOBER 31, 1999, INCOME FROM FOREIGN SOURCES WAS $4,424,942,
AND THE FUND DESIGNATED A FOREIGN TAX CREDIT OF $536,972.
- --------------------------------------------------------------------------------
<PAGE>
MFS' YEAR 2000 READINESS DISCLOSURE
MFS Investment Management(R), as an investment adviser and
on behalf of the MFS funds, is committed to the effective
use of technology in managing our portfolio investments,
delivering high-quality service to MFS fund shareholders, [Graphic Omitted]
retirement plan participants, and MFS' institutional
clients, and supporting the financial consultants who sell
our products.
MFS can now say that it is ready for the Year 2000. Our testing has demonstrated
that MFS' computer hardware and software will recognize "00" as the Year 2000
and will not confuse those digits with 1900. All of our critical business
applications and processes have been successfully tested, and we have adopted
companywide policies that will help us maintain our readiness through the
remainder of the year. Any new technology that is brought into the company
before the end of the year will be held to the same stringent standards as our
current technology. We have also developed a vendor readiness survey, contacted
over 700 of our vendors, and established an ongoing process to review responses,
as well as to review readiness statements of new vendors and products.
MFS recognizes that fund shareholders and institutional clients also are
concerned about whether the companies whose securities are held in their
portfolios are addressing Y2K issues. As part of the MFS Original Research(R)
process of evaluating portfolio investments, one of the many relevant factors
that MFS' portfolio managers and research analysts may consider is a company's
Y2K readiness.
Y2K readiness is an enormously complex, worldwide issue. No company or
institution can guarantee that it will be unaffected by the Y2K issue. While MFS
is taking significant steps to protect the integrity of its internal systems,
there can be no assurance that these steps will be sufficient to avoid any
adverse impact on MFS fund shareholders, retirement plan participants, or
institutional clients.
If you have further questions regarding MFS' Year 2000 Readiness Program, please
visit our Web site at www.mfs.com, call our toll-free line, 1-800-637-4406, or
write to the MFS Year 2000 Program Management Office by e-mail at [email protected] or
by letter at 500 Boylston Street, Boston, MA 02116-3741.
<PAGE>
<TABLE>
MFS(R) GLOBAL EQUITY FUND
<S> <C>
TRUSTEES TREASURER
Richard B. Bailey - Private Investor; W. Thomas London*
Former Chairman and Director (until 1991),
MFS Investment Management(R) ASSISTANT TREASURERS
Mark E. Bradley*
Marshall N. Cohan - Private Investor Ellen Moynihan*
James O. Yost*
Lawrence H. Cohn, M.D. - Chief of Cardiac
Surgery, Brigham and Women's Hospital; SECRETARY
Professor of Surgery, Harvard Medical School Stephen E. Cavan*
The Hon. Sir J. David Gibbons, KBE - Chief ASSISTANT SECRETARY
Executive Officer, Edmund Gibbons Ltd.; James R. Bordewick, Jr.*
Chairman, Colonial Insurance Company, Ltd.
CUSTODIAN
Abby M. O'Neill - Private Investor State Street Bank and Trust Company
Walter E. Robb, III - President and Treasurer, AUDITORS
Benchmark Advisors, Inc. (corporate financial Deloitte & Touche LLP
consultants); President, Benchmark Consulting
Group, Inc. (office services) INVESTOR INFORMATION
For information on MFS mutual funds, call your
Arnold D. Scott* - Senior Executive financial consultant or, for an information
Vice President, Director, and Secretary, kit, call toll free: 1-800-637-2929 any
MFS Investment Management business day from 9 a.m. to 5 p.m. Eastern time
(or leave a message anytime).
Jeffrey L. Shames* - Chairman and Chief
Executive Officer, MFS Investment Management INVESTOR SERVICE
MFS Service Center, Inc.
J. Dale Sherratt - President, Insight P.O. Box 2281
Resources, Inc. (acquisition planning Boston, MA 02107-9906
specialists)
For general information, call toll free:
Ward Smith - Former Chairman 1-800-225-2606 any business day from
(until 1994), NACCO Industries (holding 8 a.m. to 8 p.m. Eastern time.
company)
For service to speech- or hearing-impaired,
INVESTMENT ADVISER call toll free: 1-800-637-6576 any business
Massachusetts Financial Services Company day from 9 a.m. to 5 p.m. Eastern time. (To
500 Boylston Street use this service, your phone must be equipped
Boston, MA 02116-3741 with a Telecommunications Device for the Deaf.)
DISTRIBUTOR For share prices, account balances, exchanges,
MFS Fund Distributors, Inc. or MFS stock and bond market outlooks, call
500 Boylston Street toll free: 1-800-MFS-TALK (1-800-637-8255)
Boston, MA 02116-3741 anytime from a touch-tone telephone.
CHAIRMAN AND PRESIDENT WORLD WIDE WEB
Jeffrey L. Shames* www.mfs.com
DIRECTOR OF INTERNATIONAL
EQUITY RESEARCH
David A. Antonelli*
PORTFOLIO MANAGERS
John W. Ballen*
Toni Y. Shimura*
+Independent Trustee
*MFS Investment Management
</TABLE>
<PAGE>
MFS(R) GLOBAL GROWTH FUND ------------
BULK RATE
U.S. POSTAGE
[Logo] M F S(R) PAID
INVESTMENT MANAGEMENT MFS
We invented the mutual fund(R) ------------
500 Boylston Street
Boston, MA 02116-3741
(c)1999 MFS Investment Management.(R)
MFS(R) investment products are offered through MFS Fund Distributors, Inc.,
500 Boylston Street, Boston, MA 02116
MWF-3 12/99 64.5M 09/209/309/809
