<PAGE>
CHANCELLOR LGT
ASSET MANAGEMENT
OVER 25 YEARS
OF INVESTING
WORLDWIDE
GT GLOBAL
THEME FUNDS
SEMIANNUAL REPORT
APRIL 30, 1997
[LOGO]
<PAGE>
GT GLOBAL
THEME FUNDS
TABLE OF CONTENTS
Message from the Chairman........................1
Introduction to Theme Funds......................2
GT Global
Consumer Products
and Services Fund................................4
GT Global
Financial Services Fund..........................8
GT Global
Health Care Fund................................12
GT Global
Infrastructure Fund.............................16
GT Global
Natural Resources Fund..........................20
GT Global
Telecommunications Fund.........................24
Financials.....................................F-1
Inside Back
List of Funds................................Cover
The views of the Funds' management as described in this report are as of the
date it was written. Portfolio holdings and allocations are as of April 30,
1997, unless otherwise noted. Views, portfolio holdings and allocations may
have changed subsequent to these dates.
<PAGE>
MESSAGE FROM THE CHAIRMAN
Dear Investor,
These reports are written in a style we hope you find enjoyable to read and
easy to understand. Our intention is to provide our shareholders with
meaningful information about the relative performance of GT Global Mutual
Funds. We think it is important to help investors develop a global
perspective about their investments, including developments in individual
economies around the world. Specifically, we address how macroeconomic and
political events within countries influence investment results and,
ultimately, Fund performance.
In each semiannual report, we describe our management process and offer
insights into the Fund's investment strategy. Companies and countries in
which the Fund invests are discussed, as well as issues pertinent to
decisions affecting the Funds. Biographical information on portfolio
managers' background and experience is also included, and through our
question and answer format, we make it possible for shareholders to be
included in the thought processes that form the basis of their investment
decisions. Additionally, we have included performance illustrations that show
the historical returns of a hypothetical investment and compare it to an
appropriate benchmark.
We make every effort to communicate as clearly as possible because we want
you, our shareholders, to have a useful understanding of what is happening
with your investments in GT Global Mutual Funds, and why.
We would also like to emphasize that today--as global investing continues to
become increasingly complex, information travels as quickly as a keystroke,
and critical decisions must be made within shorter time frames,--prudent
advice, professional management, global diversification and investing for the
long term have never been more important.
As always, we appreciate and value our shareholders in GT Global Mutual Funds.
Sincerely,
/s/ William J. Guilfoyle
William J. Guilfoyle
CHAIRMAN OF THE BOARD AND PRESIDENT
GT GLOBAL MUTUAL FUNDS
<PAGE>
GT GLOBAL THEME FUNDS
GT Global Theme Funds provide investors with access to a new dimension of
global investing. Each Fund is structured to include multiple industries
that, in combination, represent important global investment themes. From
health care to natural resources to telecommunications, these themes are
central to our modern lives and form the gears that drive global growth.
As the world economy becomes ever more global, we believe it is increasingly
appropriate for investors to expand their options by investing in specific
industries as well as regions. With GT Global Theme Funds, you and your
adviser can evaluate how one or more of these six globally diversified Funds
can help you realize your investment goals.
The Funds are based on themes we believe will continue to gain importance in
the years to come.
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Seeking to benefit from the changing needs of the new global consumer, the
Fund's portfolio invests in companies that manufacture, market, retail or
distribute consumer products and services.
GT GLOBAL FINANCIAL SERVICES FUND
Focusing globally on issuers in the financial services industries, such as
banks, brokerage and investment advisory firms and insurance companies, this
Fund concentrates on the worldwide growth potential of capital markets.
GT GLOBAL HEALTH CARE FUND
Searching out promising issuers in global health care industries, including
pharmaceutical, biotechnology, health care services, and medical technology
and supply companies around the world, this Fund emphasizes the increased
health care needs of the world's aging population and the growing demand for
health care in emerging markets.
GT GLOBAL INFRASTRUCTURE FUND
Seeking to capitalize on the growing need for energy, transportation and
communications in emerging markets, and the need to upgrade existing
infrastructure in developed markets, the Fund's portfolio invests in
companies that build, upgrade and repair basic infrastructure.
GT GLOBAL NATURAL RESOURCES FUND
Targeting companies that own, explore or develop natural resources, including
precious and base metals, fossil fuels, forest and agricultural products, the
GT Global Natural Resources Fund seeks to benefit from a rise in global
industrial production and related business and inflationary cycles.
GT GLOBAL TELECOMMUNICATIONS FUND
Concentrating on companies engaged in the development, manufacture or sale of
telecommunications services or equipment, the Fund seeks to participate in
the growth of worldwide demand for information and the means by which it
travels.
2
<PAGE>
THE TEAM APPROACH TO INVESTING
Teamwork among talented investment professionals is at the center of our
investment discipline. Our Theme Fund managers, with an average of nine years
of industry experience, are supported by a group of seasoned investment
analysts. We believe working together as a team creates a combination of
strengths and facilitates the investment process. Within this framework,
individual team members concentrate on their defined industries and regions,
ensuring a deeper and broader group understanding of companies, markets and
world events. The continual exchange of knowledge and ideas promotes style
integrity and reflects our belief that the key to achieving consistent
results is following a disciplined investment process.
ABOUT THE PORTFOLIO MANAGERS
DEREK WEBB, CFA - Head of the Theme Funds and Portfolio Manager of the GT
Global Consumer Products Fund, the GT Global Natural Resources Fund and the
GT Global Infrastructure Fund. Prior to joining Chancellor LGT Asset
Management, Mr. Webb spent seven years in the financial services industry. He
received an M.B.A. from the Wharton Business School.
MICHAEL MAHONEY - Portfolio Manager of the GT Global Telecommunications Fund
since 1993 and the GT Global Infrastructure Fund since 1994; Investment
Analyst from 1991 to 1993. Previously, Mr. Mahoney was a Management
Consultant at Bain & Co. and received an M.B.A. from Stanford Graduate School
of Business.
A. JAMES ELLMAN - Portfolio Manager of the GT Global Financial Services Fund
since 1995; Investment Analyst from 1994 to 1995. Formerly, Mr. Ellman was an
international bank examiner for the Federal Reserve. He received an M.B.A.
from Harvard Graduate School of Business.
MIKE YELLEN - Portfolio Manager of the GT Global Health Care Fund since 1996;
Investment Analyst 1994-1996. Before joining Chancellor LGT Asset Management,
Mr. Yellen was a Senior Securities Analyst of the Franklin Global Health Care
Fund for Franklin Resources. He is a graduate of Stanford University.
[PHOTO]
GT GLOBAL THEME FUNDS' PORTFOLIO MANAGERS: (LEFT TO RIGHT) JAMES ELLMAN, DEREK
WEBB, MICHAEL MAHONEY AND MIKE YELLEN.
3
<PAGE>
INVESTMENT OBJECTIVE
AND CURRENT STRATEGY
The Fund seeks long-term capital growth by investing worldwide, primarily in
equity securities of companies that manufacture, market, retail or distribute
consumer products and services. The Fund looks for companies well positioned
to benefit from demographic and economic trends, and that have strong
earnings growth and fundamentals.
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
PERFORMANCE SUMMARY
GT Global Consumer Products and Services A
Class A Shares MSCI World
12/30/94 9525 10000
9467 9852
9533 9997
9858 10481
9708 10849
9867 10943
1050 10942
11400 11492
11542 11238
12083 11567
12158 11387
12475 11785
12894 12132
13101 12353
2/29/96 13575 12431
14472 12640
15352 12939
16654 12953
16456 13021
15912 12563
17318 12710
18776 13210
18094 13304
18060 14052
17832 13830
17660 13999
17201 14162
16299 13884
4/30/97 16020 14341
GT Global Consumer Products and Services B
Class B Shares MSCI World
12/30/94 10000 10000
9939 9852
10009 9997
10341 10481
10175 10849
10350 10943
11015 10942
11942 11492
12082 11238
12633 11567
12712 11387
13036 11785
13467 12132
13675 12353
2/29/96 14164 12431
15097 12640
16012 12939
17361 12953
17153 13021
16582 12563
18040 12710
19544 13210
18828 13304
18783 14052
18534 13830
18354 13999
17861 14162
16924 13884
4/30/97 16330 14341
The charts above show the performance of the GT Global Consumer Products and
Services Fund Class A and Class B shares, versus the MSCI World Index since
the Fund's inception. The chart assumes a hypothetical $10,000 initial
investment in Class A shares and reflects all Fund expenses and the maximum
4.75% sales charge. For Class B shares, results reflect all Fund expenses and
the applicable contingent deferred sales charge (5% in the first year,
decreasing to 0% after six years), assuming a complete redemption at the end
of the period. A $10,000 investment in Advisor Class shares at inception on
June 1, 1995, would have been worth $16,419 on April 30, 1997.
AVERAGE ANNUAL TOTAL RETURNS%(1)
APRIL 30, 1997
<TABLE>
Caption
Share Class Without Sales Charge(2) With Sales Charge
1-Year Life of Fund 1-Year Life of Fund
<S> <C> <C> <C> <C>
Class A(3) 4.35 24.98 -0.61 22.40
Class B(3) 3.86 24.38 -1.10 23.41
Advisor Class(4) 4.89 29.55 N/A N/A
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years) for Class A and Class B shares, respectively, which, if
included, would have reduced performance quoted.
(3) The Fund began operations on December 30, 1994.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial
institutions and other entities that have entered into specific
agreements with GT Global. Please see the "Alternative Purchase Plan"
section in the Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
From time to time, the Fund's investment advisor may waive some fees and/or
reimburse some expenses, without which performance would be lower. Waivers
and reimbursements are subject to change.
4
<PAGE>
GT GLOBAL CONSUMER AND SERVICES FUND
INTERVIEW WITH PORTFOLIO MANAGER DEREK WEBB
Q HOW HAS THE FUND PERFORMED OVER THE PAST SIX MONTHS?
A The Fund's performance has been significantly affected by the general
downturn in small cap stocks. For the six months ended April 30, 1997, the
Fund's total return for Class A shares was -11.47% (-15.67% including the
maximum 4.75% sales charge), and -11.68% for Class B shares (-15.90%
including the maximum 5% contingent deferred sales charge). The Morgan
Stanley Capital International (MSCI) World Index,(5) which is heavily
concentrated in larger cap stocks, returned 7.79% over the same period. The
index is designed to represent the performance of all markets, however, and
does not reflect the Fund's concentration in the consumer products and
services industries.
Q WHAT CONTRIBUTED TO THE FUND'S DISAPPOINTING RETURNS?
A We invest in companies that are growing earnings at the fastest rates
and have the potential for positive earnings surprises and positive earnings
revisions by analysts. In addition, we look for companies that have high
relative strength versus the market and price-to-earnings ratios below their
growth rates. This style of investing has been out of favor over the last six
months. During this time, concerns about the Fed raising interest rates have
been the primary cause of the underperformance in smaller cap growth stocks
relative to larger cap stocks in the U.S., which is not unusual during
periods of uncertainty.
In the first three quarters of 1994, for example, growth stocks
underperformed larger stocks. During that period, the Fed was raising rates
and, in times of uncertainty, people tend to look for safe havens and switch
into larger stocks. Thus, growth stocks have lagged the moves in larger
stocks.
Q HAS THIS DOWNTURN IN GROWTH STOCKS LEAD YOU TO ALTER YOUR DISCIPLINE?
A No. We look for companies whose earnings growth, in our opinion, is
likely to outpace expectations. And although growth names have underperformed
dramatically, we believe down periods are generally followed by longer
periods of outperformance. The recent bout of weakness is essentially an
outcome of the rise in U.S. interest rates, which sent shock waves around the
world. It is also interesting to note that growth stocks in the U.S. are at
their cheapest levels versus the S&P 500 since 1979.
Q HOW DID SPECIFIC COMPANIES AFFECT THE FUND'S PERFORMANCE?
A In this environment, if a growth company had disappointing earnings, the
stock declined dramatically. Boyds, for example, missed their quarterly
earnings estimate. That's why we stick to our discipline. We sold off right
away, and even though we sold it after its price had already dropped
considerably, the company's stock price continued to deteriorate. There are a
number of company-specific stories, and the casualties were excessively high
because of the market environment. When companies CONTINUED P6
SMALL CAP STOCK UNDERPERFORMANCE
RUSSELL 2000 % UNDERPERFORMANCE VS.
THE DOW JONES INDUSTRIAL AVERAGE(6)
Jan 1
0.990822
0.983293
0.981081
0.981089
0.988783
0.981224
0.971116
0.969699
0.966475
0.97069
0.964458
0.957397
0.959709
0.956635
0.962221
0.975149
0.97762
0.975878
0.979092
0.966214
0.959761
Feb 0.964306
0.965497
0.958488
0.963329
0.959582
0.951295
0.951387
0.940603
0.933385
0.932343
0.939226
0.939226
0.931109
0.93769
0.943545
0.939915
0.929847
0.926792
0.926558
0.9274
Mar 0.930937
0.926528
0.939163
0.931742
0.931564
0.928304
0.922105
0.923311
0.920551
0.930808
0.925728
0.913681
0.915195
0.909589
0.918599
0.919175
0.900008
0.906969
0.910533
0.920595
0.920595
0.925304
Apr 0.916926
0.921726
0.923499
0.928812
0.93557
0.930884
0.93937
0.938518
0.94386
0.933288
0.919982
0.905776
0.909177
0.906556
0.90319
0.879806
0.88331
0.886286
0.886261
0.881148
0.869935
May 0.870246
Source: Datastream, May 5, 1997
The underperformance of U.S. small companies over the year to the end of
April has several possible explanations. Relative to the experience of past
business cycles, this underperformance is surprising in that both short-term
interest rates and long bond yields have begun to rise. However, latent
deflationary pressures are greater this time, a phenomena likely to hit
smaller companies harder than large corporations with global scope and
pricing power. Another possibly relevant development is the rise in
popularity of large cap index tracker funds, which may be supporting large
cap share prices. Finally, the current stock price for many small company
initial public offerings made over the last year is below the issue price,
which may have soured investor sentiment.
(5) The MSCI World Index is a market value-weighted average of the
performance of 1,554 securities listed on major world stock exchanges
- the U.S., Europe, Canada, Australia, New Zealand and the Far East.
It includes the effect of reinvested dividends and is measured in U.S.
dollars.
(6) The Russell 2000 Index is composed of 2,000 U.S.-domiciled common
stocks designed to measure small company stock performance. The index
represents roughly 10% of the U.S. stock market, and market
capitalization of index companies ranged from $90 million to $1.17
billion as of June 1996. Its performance includes the effect of
reinvested dividends and is measured in U.S. dollars. The Dow Jones
Industrial Average is a price weighted average of 30 blue-chip stocks
that are generally the leaders in their industry and are listed on the
New York Stock Exchange.
Indices are unmanaged, not available for direct investment and do not incur
sales charges and professional management fees.
5
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
did poorly, they were decimated within a matter of days. That's the kind of
market we've been in.
Q WHAT ARE YOUR EXPECTATIONS GOING FORWARD?
A We continue to find consumer products and services companies
particularly attractive investments. Often, they have distinguished
franchises or name-brand products that tend to compete more on perceived
value than strictly on price. We also find them good investments because many
tend to have low fixed assets and high unrestricted cash flows. High cash
generation makes it possible for them to reinvest in core businesses, make
acquisitions, repurchase stock or debt, or increase their dividends. Many
consumer products are also repetitive purchases, making them less dependent
on business cycles.
We currently anticipate maintaining a high weighting in the U.S., still the
world's best market for consumer products companies. There are also many
multinational consumer companies we believe are well positioned to take
advantage of rising income levels in many emerging markets. Emerging market
nations have enjoyed GDP growth at an average of 5.2% since 1990. In
comparison, G-7 countries (the U.S., Japan, Germany, France, Italy, the UK
and Canada) have experienced an average growth in GDP of 2.0%. As income
grows in emerging nations, so does their appetite for consumer products.
We have also added to our position in Europe. Many of these markets are
beginning to enjoy a pickup in growth. At the same time, many European
companies are placing more emphasis on generating shareholder value, making
them increasingly attractive investments.
DEVELOPING COUNTRIES HIGHER INCOME GROWTH
GDP Growth
(annual
% change)
G-7 Developing Countries
1990' 0.022 0.032
1991' 0.008 0.038
1992' 0.017 0.048
1993' 0.011 0.049
1994' 0.021 0.049
1995E 0.031 0.05
1996E 0.031 0.052
1997E 0.028 0.053
1998E 0.027 0.054
1999E 0.025 0.054
2000E 0.027 0.054
AS INCOMES IN DEVELOPING MARKETS CONTINUE TO RISE, A GROWING PERCENTAGE OF
INCOME IS BEING SPENT ON CONSUMER PRODUCTS AND SERVICES.
Source: The World Bank
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
ALLOCATION OF NET ASSETS %
1997 1996
APRIL 30 APRIL 30
CONSUMER NON-DURABLES 41.3 45.2
SERVICES 21.4 34.5
CONSUMER DURABLES 8.1 6.3
FINANCE 7.5 3.1
MULTI-INDUSTRY 2.6 -
TECHNOLOGY 2.1 3.1
HEALTH CARE 2.1 -
SHORT-TERM & OTHER 14.9 7.8
6
<PAGE>
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
GEOGRAPHIC ALLOCATION OF NET ASSETS
Asia-Pacific 0.4%
Europe 14.9%
North America & Other 84.7%
[GRAPH]
Allocations will change based on current market conditions.
A complete listing may be found in the Financial Statements section of this
report.
<TABLE>
<CAPTION>
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
% of
KEY PORTFOLIO HOLDINGS(7) Country Net Assets
<S> <C> <C>
MORNINGSTAR GROUP, INC. A national manufacturer of refrigerated specialty food U.S. 4.1
products. Brand names include International Delight, a non-dairy, gourmet,
flavored coffee creamer, Second Nature, an egg product, and Lactaid, a lactose-
reduced fluid milk product.
PROCTER & GAMBLE CO. Manufactures laundry, cleaning and personal care products U.S. 3.7
as well as food and beverages. The company's goods are sold throughout the world.
TELECOM ITALIA MOBILE S.p.A. A duopolist in cellular telephone services in Italy, Italy 3.5
Telecom Italia Mobile was spun off from telephone company Telecom Italia S.p.A.,
and has become Europe's largest cellular telephone company. It manages GSM digital
and traditional analog cellular phone systems and offers paging and public radio
mobile communication services.
GILLETTE CO. Manufactures products that include grooming aids, writing instruments, U.S. 3.5
toothbrushes and oral care items. The company's products are distributed in over
200 countries and territories.
CLOROX Manufactures and sells grocery store products throughout the world. The U.S. 3.4
company also produces products for the janitorial, institutional and food service
industries.
COLGATE-PALMOLIVE CO. A global consumer products company whose core products U.S. 3.4
provide oral care, body care, household surface care and dietary care. The company
markets its products under a variety of brand names including Colgate, Palmolive,
Ajax, Fab, Irish Spring and Prescription Diet.
TABACALERA S.A. Manufactures and sells tobacco and stamps worldwide. Spain 3.3
RISER FOODS, INC. Operates 36 retail supermarkets in northeast Ohio under the Rini-Rego U.S. 3.2
Stop-n-Shop banner, in addition to its wholesale distributor, American Seaway Foods.
Riser also produces private label ice cream through its Eagle Ice Cream Division.
INTERSTATE BAKERIES CORP. Produces and distributes baked goods in the southern, U.S. 3.2
southwestern and western United States.
NBTY, INC. Manufactures, sells and distributes vitamins and food supplements under U.S. 3.1
the Nature's Bounty, Hudson, Natural Wealth and Good 'N Natural labels. The company
also operates 83 Vitamin World retail stores in 30 states.
</TABLE>
Source: Bloomberg
(7) There is no assurance the Fund will continue to hold these or any
other securities mentioned in this report.
7
<PAGE>
INVESTMENT OBJECTIVE
AND CURRENT STRATEGY
The Fund seeks long-term growth of capital primarily by investing in the
equity securities of financial services companies, including those engaged in
banking, insurance, investment management, brokerage and diversified
financial activities. The Fund invests in financial services companies we
believe will experience rising profitability, among other attributes.
GT GLOBAL FINANCIAL SERVICES FUND
PERFORMANCE SUMMARY
GT GLOBAL FINANCIAL SERVICES A
MSCI World Index MSCI Banking Index GT Global Financial Services A
10000 10000 9525
9974 10012 9525
10165 10010 9508
10473 10042 9950
10200 9707 9683
10492 9971 9683
10039 9542 9283
10138 9631 9075
9987 9507 8825
10135 9550 8650
10626 9943 8408
10998 10534 8583
11094 10648 9242
11093 10141 9400
11650 10915 9850
11393 10355 9942
11727 10736 10117
11544 10355 9933
11947 11041 10458
12299 11566 10805
12524 11437 11007
12602 11374 10990
12814 11648 11158
13118 11818 11411
13131 11641 11537
13200 11602 11386
12736 11369 10998
12885 11513 11369
13392 12033 11781
13488 12173 11941
14246 12753 12681
14020 12096 12448
14192 11820 13025
14357 12379 13521
14076 11881 13016
14538 12177 13422
GT GLOBAL FINANCIAL SERVICES B
MSCI World Index MSCI Banking Index GT Global Financial Services B
10000 9525 10000
10000 9525 10000
9974 9508 9974
10437 9950 10437
10149 9683 10149
10149 9683 10149
9720 9283 9720
9493 9075 9493
9230 8825 9230
9046 8650 9046
8793 8408 8793
8968 8583 8968
9650 9242 9650
9816 9400 9816
10280 9850 10280
10367 9942 10367
10551 10117 10551
10350 9933 10350
10892 10458 10892
11255 10805 11255
11458 11007 11458
11431 10990 11431
11607 11158 11607
11863 11411 11863
12004 11537 12004
11837 11386 11837
11431 10998 11431
11810 11369 11810
12233 11781 12233
12401 11941 12401
13159 12681 13159
12905 12448 12905
13500 13025 13500
14010 13521 14010
13481 13016 13481
13587 13422 13587
The charts above show the performance of the GT Global Financial Services
Fund Class A and Class B shares, since the Fund's inception, versus the MSCI
World Index and the MSCI Banking Index. The chart assumes a hypothetical
$10,000 initial investment in Class A shares and reflects all Fund expenses
and the maximum 4.75% sales charge. For Class B shares the results reflect
all Fund expenses and the applicable contingent deferred sales charge (5% in
the first year, decreasing to 0% after six years), assuming a complete
redemption at the end of the period. A $10,000 investment in Advisor Class
shares at inception on June 1,1995, would have been worth $14,671 on April
30, 1997.
AVERAGE ANNUAL TOTAL RETURNS %(1)
APRIL 30, 1997
<TABLE>
<CAPTION>
Share Class Without Sales Charge(2) With Sales Charge
1-Year Life of Fund 1-Year Life of Fund
<S> <C> <C> <C> <C>
Class A(3) 17.62 12.48 12.04 10.62
Class B(3) 17.06 11.92 12.06 11.09
Advisor Class(4) 18.28 22.16 N/A N/A
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
contingent deferred sales charge (5% in the first year, decreasing to
0% after six years) for Class A and Class B shares, respectively,
which if included, would have reduced performance quoted.
(3) The Fund began operations on May 31, 1994.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial
institutions and other entities that have entered into specific
agreements with GT Global. Please see the "Alternative Purchase Plan"
section in the Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
From time to time, the Fund's investment advisor may waive some fees and/or
reimburse some expenses, without which performance would be lower. Waivers
and reimbursements are subject to change.
8
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND
INTERVIEW WITH PORTFOLIO MANAGER
JAMES ELLMAN
Q HOW DID THE FUND PERFORM?
A We are very pleased with the Fund's performance over the past six
months. Total return for the six-month period ended April 30, 1997, was
12.40% for Class A shares (7.06% including the maximum 4.75% sales charge)
and 11.99% for Class B shares (6.99% including the maximum contingent
deferred sales charge). In comparison, the Fund's benchmark, the Morgan
Stanley Capital International (MSCI) Banking Index,(5) returned 0.03% for the
same period, while the broader MSCI World Index(6) returned 7.79%.
Q HOW DO YOU ACCOUNT FOR THE FUND'S OUTPERFORMANCE RELATIVE TO THE MSCI
BANKING INDEX?
A Although our basic strategies have not changed, areas where we deviated
from the MSCI Banking Index have paid off very well. We took some geographic
positions, in addition to some valuation and market cap positions,
particularly in the U.S., where we leaned more toward larger cap stocks.
Q WHAT WAS YOUR INVESTMENT STRATEGY OVER THE SIX MONTHS?
A We have continued to significantly underweight Japan. Japanese financial
institutions have been weighed down by credit quality concerns for some years
now, and with the recent failure of several insurance companies and banks and
increasing pressure on some of the smaller brokerage firms, we don't foresee
a quick end to bankruptcies and overwhelming structural weakness. While over
time we expect to add to our allocation, at least in the near future we
expect to remain below the index weighting.
We have remained significantly above the index in the U.S., particularly in
large cap bank and insurance names such as Bank of America, Citicorp,
American International Insurance, SunAmerica and Greenpoint (a large mortgage
lender). Clearly, not only is the U.S. doing very well, but large cap S&P 500
stocks have also been outperforming.
We are, however, currently shifting more into smaller cap stocks, both in the
U.S. and abroad. A number of them have gone down in spite of earnings
increases, primarily because small cap stocks have fallen out of favor with
investors.
We are also finding some interesting opportunities in Hong Kong. One example
is Manhattan Card, a company that issues credit cards under the Chase
Manhattan name. Chase Manhattan owns significant equity in the company and
retains control of management. Manhattan Card has enjoyed strong growth in
earnings--an increase of 50% over the last two years--and is forecasted to jump
a further 25%-50% in the next two years. Despite strong fundamentals, the
price of its stock has fallen from HK$4.5 less than a year ago to below
HK$2.5, and now trades on less than 8 times expected earnings. It also offers
an attractive yield of between 5%-8%. So we see it as a good value stock with
the potential to turn around.
Q COULD YOU DESCRIBE YOUR INVESTMENT PROCESS?
A In general, our strategy focuses on buying companies when they're
relatively cheap and concerns are high, and selling them when they reach a
point where they're more expensive historically and concerns are low. The
average stock in the portfolio, for example, will typically have a lower
price to earnings ratio (P/E) (for the Fund the P/E is, on average, below 10
and the index is above 10) and a lower price-to-book ratio than the index
(average for the Fund is 1-1.5x and the index is 2x).
Our risk control methods include geographic distribution, low individual
stock weightings (our position in any single stock does not generally exceed
5%), and relatively high dividend, low P/E and low price-to-book stocks. We
primarily look for strong franchises where earnings estimates have been
rising, the expectations of management are positive and potential exists for
analysts to rerate the company.
Q WHAT DO YOU FIND SO ATTRACTIVE ABOUT THE U.S. FINANCIAL SERVICES INDUSTRY?
A Three main trends evident in the U.S. today account for our bullish
view--consolidation, technology and share repurchase. Consolidation occurs
when one bank or insurance company takes over another, downsizing its back
office and making its distribution system more efficient through automation.
In general, such changes tend to lead to higher-than-expected earnings. The
bank's or insurance company's stock multiple can also go up, which means the
company's ability to use its stock as an acquisition currency can become much
more valuable, allowing the bank to continue the acquisition cycle.
CONTINUED P10
(5) The MSCI Banking Index is a market value-weighted average of the
performance of 109 securities listed on major world stock exchanges --
the U.S., Europe, Canada, Australia, New Zealand and the Far East. It
includes the effect of reinvested dividends and is measured in U.S.
dollars.
(6) The MSCI World Index is a market value-weighted average of the
performance of 1,554 securities listed on major world stock exchanges
-- the U.S., Europe, Canada, Australia, New Zealand and the Far East.
It includes the effect of reinvested dividends and is measured in U.S.
dollars.
Indices are unmanaged, not available for direct investment
and do not incur sales charges and professional management fees.
9
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
We believe the consolidation trend in U.S. banking and insurance will proceed
into the next decade. To date, 1997 has been a big year for consolidation and
is on track to be potentially the largest ever in dollar terms. We expect a
pickup in activity toward the latter half of the year for several reasons:
annual budget reviews get underway; some large banks have digested recent
acquisitions and appear poised for another; and a number of companies have
excess capital.
A second reason to be bullish on the U.S. is that technology is having a
considerable impact on the front office side. ATMs, credit cards, smart
cards, phone banks, Internet insurance sites, and PC banks are gaining more
acceptance. These lower-cost distribution networks are allowing large U.S.
financial companies to provide customers with as many, or more, products as
before, while significantly reducing costs.
Share repurchases are also very positive in the sense that some banks and
insurance companies are using excess capital and high profitability to buy
back their stock instead of throwing it at less desirable investments.
Repurchases have forced managers to become very structured in the use of
capital, which has ensured that bank asset quality has remained strong and
insurance pricing has stayed relatively rational, particularly on the
personal property and casualty side (vs. life insurance), where we have been
investing. Share repurchase also has the positive effect of driving down the
share count and increasing earnings per share; as a result, we keep seeing
more earnings surprises, and overall return on equity (ROE) continues to
increase, making these companies attractive.
PROFITABILITY OF LARGE U.S. BANK STOCKS ON THE RISE
ROE
1991 -- 10.47%
1992 -- 13.35%
1993 -- 16.15%
1994 -- 16.26%
1995 -- 16.75%
1996 -- 16.73%
1997e -- 18.43%
Source: Keefe, Bruyette & Woods, Inc., April 21, 1997
Q DO YOU HAVE ANY CONCERNS? WHAT COULD CAUSE SENTIMENT TO CHANGE?
A Interest rate concerns often crop up in financial stocks, and bank
stocks tend to go down when interest rates go up. We don't believe interest
rates are going to shoot up, which would be a real negative, but a slow,
modest increase should actually be positive for banks. You may have noticed
from the small increase in interest rates this year that while banks
increased their prime rates, they did not increase their deposit rates, so
their margins actually improved.
Bank stocks are also very sensitive to asset quality. We tend to shy away
from subprime lenders and own primarily large banks and insurance companies
that lend and insure mainly to U.S. corporates and well-off consumers, where
asset quality remains very strong. Currently, the environment for banks'
asset quality is generally positive. Corporate earnings are strong and
bankruptcies are few.
Q WHAT HAS BEEN THE FUND'S POSITION WITH RESPECT TO EMERGING MARKETS?
A Results of our quantitative studies on emerging markets indicate that
value stocks outperformed dramatically throughout the '90s. Using a
proprietary quantitative model, we analyze which markets have stocks that
meet our criteria. We're not buying stocks just because they're generated by
the computer, but we are spending a significant amount of time making sure we
either own a stock in the quantitative model or know why we don't.
Recently, we shifted money from Japan and core Europe to invest in peripheral
European and emerging markets. This strategy has worked to our advantage as
emerging markets have for the most part enjoyed a rebound this year. Specific
stocks that have done well include Zagrabacka Banca in Croatia, Akbank in
Turkey, Absa in South Africa and Hapoalim in Israel.
Q WHERE DO YOU EXPECT TO FIND OPPORTUNITIES GOING FORWARD?
A Aside from a number of attractive opportunities in Hong Kong, we are
also adding to the Fund's position in Australia. Australian banks yield
5%-8%, and while earnings per share growth isn't huge at 5%-15% a year, some
consolidation is taking place in the industry. Moreover, share repurchases
are picking up speed and technology is being brought to bear more than it has
in the past. With stocks trading at roughly 11 times next year's earnings or
lower, we think some attractive values are to be found. In terms of
risk/reward, we are finding stocks that offer relatively high yields,
relatively low P/Es and earnings that are growing.
10
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND
GEOGRAPHIC ALLOCATION OF NET ASSETS
Latin America 3.6%
Africa & Middle East 4.8%
Europe 15.4%
Asia-Pacific 15.7%
U.S. Canada & Other 60.5%
[GRAPH]
Allocations will change based on current market conditions. A complete
listing may be found in the Financial Statements section of this report.
GT GLOBAL FINANCIAL SERVICES FUND
ALLOCATION OF NET ASSETS %
1997 1996
APRIL 30 APRIL 30
BANKS - REGIONAL 48.0 19.0
BANKS - MONEY CENTER 13.9 27.7
INSURANCE 9.7 5.9
OTHER FINANCIAL 5.2 10.6
CONSUMER FINANCE 3.5 10.3
SECURITIES BROKER 1.9 10.5
INVESTMENT MANAGEMENT 1.6 6.1
REAL ESTATE 0.9 2.2
SHORT-TERM & OTHER 15.3 7.7
<TABLE>
<CAPTION>
% OF
KEY PORTFOLIO HOLDINGS(7) COUNTRY NET ASSETS
<S> <C> <C>
BANKAMERICA CORP. Provides diverse financial products and services to individuals, U.S. 4.7
businesses, government agencies, and financial institutions throughout the world.
The company's banking subsidiaries operate over 2,000 offices throughout the
western United States. It also operates corporate banking and business credit offices
in major U.S. cities and 36 countries.
CHASE MANHATTAN CORP. A bank holding company that provides domestic and international U.S. 4.0
financial services corporate finance, wholesale banking and investment services, and
emphasizes originations, underwriting, risk such as management products and private
banking.
CONSECO, INC. A financial services holding company with interests in life insurance U.S. 3.1
and administrative and investment management services.
CITICORP The parent of Citibank, Citicorp offers a broad range of financial services U.S. 2.7
and operates in over 3,200 locations in 98 countries and territories.
HSBC The holding company for the HSBC Group, an international banking and financial HONG KONG 2.0
services organization with operations throughout the world.
GREEN POINT FINANCIAL CORP. The bank holding company for GreenPoint Bank and U.S. 1.8
GreenPoint Mortgage Corp. The company's primary businesses are specialty limited-
documentation mortgage lending nationwide and consumer banking in the New York
metropolitan area.
FIRST UNION CORP. A bank holding company whose subsidiary banks attract deposits U.S. 1.7
and offer residential and commercial real estate, agricultural and consumer loans.
AMERICAN INTERNATIONAL GROUP (AIG) Underwrites commercial and industrial U.S. 1.4
insurance throughout the U.S. and abroad, including property, casualty, marine,
life and financial guarantee insurance. AIG also provides a variety of financial
services and operates in approximately 130 countries.
BANK HAPOALIM LTD. A universal bank with branches throughout Israel and abroad. ISRAEL 1.2
NATIONS BANK CORP. A product of the merger between NCNB Corporation and U.S. 1.2
C&S/Sovran Corporation. The company offers a wide variety of services, including
retail services, asset management, and financial products and services. It operates
in 16 states and the District of Columbia.
</TABLE>
Source: Bloomberg
(7) There is no assurance the Fund will continue to hold these or any
other securities mentioned in this report.
11
<PAGE>
[GRAPHIC]
INVESTMENT OBJECTIVE
AND CURRENT STRATEGY
The Fund seeks long-term capital appreciation by investing primarily in
equity securities of health care companies, including those specializing in
pharmaceuticals, biotechnology, medical devices and supplies, and health care
services. The Fund's strategy is to invest in the securities of a variety of
health care companies worldwide that we believe will benefit from economic,
political and regulatory developments.
GT GLOBAL HEALTH CARE FUND
PERFORMANCE SUMMARY
CLASS A SHARES
MSCI World Index MSCI Health & Personal Care Index GT Global Health Care A
10000 10000 9525
9856 10034 9608
10136 10347 9650
9800 10050 9858
10193 10365 10200
10522 10564 10368
10032 10219 9900
9604 9696 9908
9025 9513 10184
8897 9668 10184
9835 10734 11286
9767 11097 11587
9858 11452 11612
8937 10502 10844
7996 9870 10409
8744 10758 10718
8602 11139 11445
8784 11243 11729
9107 11550 12509
9951 12607 13546
9660 12807 14326
9737 12852 14034
9959 13214 14737
9346 12603 14051
9789 13522 15045
9759 13790 15422
10017 13950 15576
10181 14712 16527
9739 14453 15902
10450 16468 18518
10258 15572 18276
10083 15263 17517
9610 14554 16344
9745 14471 15317
10135 15087 15679
9797 14553 15066
9824 15213 15679
10065 15276 15291
9974 14813 14946
9706 14685 15058
9881 14847 16007
9963 14649 16016
9998 13688 15446
10237 13239 13444
10832 13387 13634
11336 13991 13720
11599 14405 14540
11504 13779 14583
11743 13123 14195
12283 13819 14298
12058 13950 14868
12392 14359 15412
11693 14161 15567
12267 14628 16433
13078 15124 17550
12911 14542 16849
12357 13906 15749
12741 14245 15714
12776 14437 15654
12743 14446 14814
12987 14429 15437
13381 15598 17030
13031 15579 17022
13404 16022 16970
12825 16077 16554
12952 16425 16481
12760 16837 17012
12949 17335 17338
13575 18319 17897
14051 18973 17450
14174 19209 17385
14172 19974 17664
14884 20632 18773
14555 20275 19127
14982 21750 20049
14749 22406 20329
15264 23270 21409
15713 24437 22573
16000 25028 23729
16100 25041 24429
16371 25446 24906
16759 25234 25097
16777 25687 25521
16865 26469 24323
16272 25841 22106
16462 26595 23920
17109 28206 25691
17232 28849 25034
18201 30693 25193
17912 30040 27954
18131 32204 28895
18343 32677 29091
17983 31951 25645
18574 34156 24256
CLASS B SHARES
MSCI World Index MSCI Health & Personal Care Index GT Global Health Care B
10000 10000 10000
10377 10573 10199
10618 10886 10802
10531 10413 10827
10750 9917 10532
11244 10443 10603
11038 10542 11020
11344 10851 11418
10704 10702 11520
11230 11054 12160
11972 11430 12983
11819 10990 12456
11312 10509 11640
11663 10765 11608
11695 10910 11563
11665 10917 10939
11889 10904 11389
12249 11787 12559
11929 11773 12552
12271 12108 12507
11741 12150 12199
11857 12412 12138
11681 12724 12525
11853 13100 12760
12427 13843 13169
12863 14338 12830
12975 14516 12781
12974 15094 12982
13625 15592 13785
13324 15322 14041
13715 16436 14712
13502 16932 14906
13973 17585 15694
14384 18467 16537
14647 18913 17381
14739 18923 17887
14987 19230 18234
15342 19070 18368
15358 19412 18668
15438 20002 17784
14895 19528 16158
15069 20098 17476
15662 21316 18763
15774 21802 18273
16661 23195 18384
16397 22702 20390
16598 24337 21067
16791 24694 21204
16462 24145 18687
17003 25811 17468
The charts above show the performance of the GT Global Health Care Fund Class
A and Class B shares, versus the MSCI World Index and the MSCI Health and
Personal Care Index since the Fund's inception. The chart assumes a
hypothetical $10,000 initial investment in Class A shares and reflects all
Fund expenses and the maximum 4.75% sales charge. For Class B shares, results
reflect all Fund expenses and the applicable contingent deferred sales charge
(5% in the first year, decreasing to 0% after six years), assuming a complete
redemption at the end of the period. A $10,000 investment in Advisor Class
shares at inception on June 1, 1995 would have been worth $14,078 on April
30, 1997.
AVERAGE ANNUAL TOTAL RETURNS %(1)
APRIL 30, 1997
<TABLE>
<CAPTION>
Share Class Without Sales Charge(2) With Sales Charge
1-Year 5-Year Life of Fund 1-Year 5-Year Life of Fund
<S> <C> <C> <C> <C> <C> <C>
Class A(3) -3.35 9.63 12.86 -7.94 8.57 12.15
Class B(3) -3.81 N/A 14.97 -8.24 N/A 14.65
Advisor Class(4) -2.91 N/A 19.55 N/A N/A N/A
</TABLE>
HISTORICAL PERFORMANCE %(2)
ANNUAL TOTAL RETURNS (PER CALENDAR YEAR)
<TABLE>
1989 1990 1991 1992 1993 1994 1995 1996
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Class A 8.85(3) 13.14 57.88 -13.51 2.61 0.29 36.96 23.84
Class B N/A N/A N/A N/A 21.60(3) -0.19 36.24 23.30
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years) for Class A and Class B shares, respectively, which, if
included, would have reduced performance quoted.
(3) The Fund began operations on August 7, 1989; Class B shares commenced
on April 1, 1993.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial
institutions and other entities that have entered into specific
agreements with GT Global. Please see the "Alternative Purchase Plan"
section in the Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
12
<PAGE>
GT GLOBAL HEALTH CARE FUND
INTERVIEW WITH PORTFOLIO MANAGER
MIKE YELLEN
Q HOW HAS THE FUND PERFORMED?
A The health care environment over the past six months has been a
difficult one for the Fund. Total return from November 1, 1996, to April 30,
1997, was -3.11% for Class A shares (-7.71% including the maximum 4.75% sales
charge), and -3.31% for Class B shares (-7.77% including the maximum 5%
contingent deferred sales charge). The Fund's benchmarks, the Morgan Stanley
Capital International (MSCI) World Index(5) and the MSCI Health and Personal
Care Index,(6) returned 7.79% and 18.39%, respectively.
While we remain positive on the Fund's longer-term prospects, it is important
to note that performance of any Fund investing in a narrowly defined universe
will be affected by changes in sentiment and, therefore, will experience
volatility over the short term. It has been our experience that these swings
tend to overshoot fair value, at times significantly overvaluing companies
and sectors because of hype and overoptimistic projections, and at other
times drastically undervaluing them based on excessive pessimism. We believe
we are currently witnessing the latter, at least as it relates to select
companies in the biotechnology and medical device fields, which have
extremely promising late-stage products with significant market potential.
Q WHY HAS THE FUND UNDERPERFORMED THE MSCI HEALTH AND PERSONAL CARE INDEX
TO SUCH A LARGE EXTENT?
A The Fund's underperformance is primarily a result of its underweighting
in large cap health care companies, which are heavily represented in the
index. The U.S. market continues to see a divergence in performance between
large, blue-chip stocks and the small to mid cap universe. Large cap stocks
have performed well because investors have been putting a premium on
liquidity and safety of earnings.
We have believed for some time that large cap issues, particularly in the
health care universe, are much less attractively valued than their small cap
counterparts. Large cap stocks are trading at historical highs in terms of
valuations. Unfortunately, this divergence has become even more pronounced in
the last six months, producing a veritable bear market for many small cap
stocks, especially those emerging companies without significant sales or
earnings. Many of these stocks have fallen anywhere from 30%-75%, often
without any fundamental changes in outlook for the business, but simply
because market sentiment toward these types of stocks has soured considerably.
Nevertheless, we continue to believe this environment has created many
compelling investment opportunities in select, smaller cap companies. Most of
these companies should see their stock prices rebound considerably as they
continue to generate revenue and profit growth in their businesses. Or, in the
case of emerging biotechnology and medical technology companies, prices should
improve as they continue to progress toward bringing their products to the
market and investors begin to appreciate their potential value.
Q WERE ANY HOLDINGS PARTICULARLY AFFECTED BEYOND THE SMALL CAP SELLOFF?
A Most stocks experienced negative returns on the back of the selloff in
small cap stocks, with very few companies underperforming on weak or
deteriorating fundamentals. Those that did, and where the Fund had relatively
larger positions, include Genelabs. The results of a pivotal trial for a
Genelabs drug that treats lupus were perceived by Wall Street as
disappointing. Sequus also suffered as a result of slow initial sales for two
approved drugs.
Q COULD YOU DESCRIBE YOUR INVESTMENT STRATEGY OVER THE PERIOD?
A While the market has not treated many of the stocks in our universe
well, we continue to believe in the same straightforward approach that has
served us well in past years. This approach includes extensive fundamental
analysis, a determined focus on value and a very disciplined buy and sell
process.
Regarding the overall portfolio structure, the Fund continues to be
diversified across all sectors of the industry. However, we have increasingly
shifted weightings toward medical product companies and away from medical
services. We believe many health care service companies will witness
intensified scrutiny from governments and insurance companies over
questionable billing practices. We expect this scrutiny, coupled with basic
excess capacity throughout much of the industry, will promote continued
pressure on margins and earnings. CONTINUED P14
(5) The MSCI World Index is a market value-weighted average of the
performance of 1,554 securities listed on major world stock exchanges--
the U.S., Europe, Canada, Australia, New Zealand and the Far East. It
includes the effect of reinvested dividends and is measured in U.S.
dollars.
(6) The MSCI Health and Personal Care Index is a market value-weighted
average of the performance of 55 securities listed on major world
stock exchanges. Index returns are given without dividends before
December 1993, with dividends after December 1994. It is measured in
U.S. dollars.
Indices are unmanaged, not available for direct investment and do not include
the effects of sales charges and professional management fees.
13
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
Fundamentals for medical product companies continue to be quite strong, with
aging demographics in developed countries and rising living standards in
emerging economies combining to provide potential for increased demand in
health care products over the coming years. In general, the Fund continues to
prefer companies with more proprietary and medically important products,
which we think provide high barriers to entry and very generous profit
margins. These types of companies tend to offer the most attractive long-term
returns to shareholders.
Q WHAT ACCOUNTS FOR THE FUND'S OVERWEIGHTED POSITION IN THE BIOTECHNOLOGY
SECTOR?
A The Fund holds approximately 30%-35% of assets in this group. While we
include established blue-chip firms such as Amgen, many of these companies
are just now transitioning from emerging, developmental-stage platforms to
larger commercial enterprises. Many of the vitally important medicines they
will be launching over the next 12-24 months should be clear improvements
over existing therapies for specific diseases or medical conditions.
Given the multi-hundred million dollar sales potential for many of these
products, we find select companies in this category to be very undervalued at
today's prices. The key, as always, is to successfully identify those
companies and invest at attractive valuation levels. Most of today's handful
of profitable biotechnology companies have created billions of dollars of
shareholder wealth with, in most cases, one, or sometimes two, very
successful products. In general, given the positive news and increasing
number of product approvals expected in the biotech sector over the next
12-24 months, we believe market sentiment towards this group will improve
considerably.
Q WHAT EMPHASIS ARE YOU PUTTING ON RISK REDUCTION IN YOUR INVESTMENT
SELECTIONS?
A Risk reduction is vitally important to strong long-term investment
returns, particularly in a sector such as biotechnology drug development,
which is by nature a high-risk enterprise. The larger biotechnology holdings
in the Fund have already commercialized their lead products or have released
extremely compelling late-stage clinical data that should almost certainly
lead to product approval.
We believe such companies often represent very attractive risk/reward
situations, depending, of course, on their underlying valuations and the
potential market size for their products. Most importantly, however, product
development risk is minimized with these types of companies. Conversely, the
Fund has minimal exposure to early stage biotechnology companies because we
believe their valuations are almost never inexpensive enough to appropriately
discount the extremely high risk profile of successful product development.
Extensive fundamental analysis remains the key to providing strong
performance for the Fund. LGT, Chancellor LGT's parent company, is one of the
largest institutional health care investors in the U.S. with approximately $1
billion in dedicated health care funds. This position provides us not only
with excellent support from the top analysts and brokerage firms on Wall
Street and around the world, but also with direct access to the companies and
management teams in which we invest. We strongly believe these essential
resources add value for our Fund shareholders.
Q WHAT FACTORS UNDERPIN YOUR OPTIMISM FOR THIS INDUSTRY OVER THE LONGER
TERM?
A Health care has historically been a very steady growth sector that has
created enormous shareholder value for many of the companies participating in
that growth. We believe all macro trends are in place for this to continue.
The most powerful one is demographics. Indeed, there is probably no better
industry to invest in as a play on the aging baby boom theme in the U.S. and
in most other developed nations.
Meanwhile, advances in medical science will continue to create entirely new
markets as new treatments are discovered for inadequately treated diseases.
People will continue to demand products and services with the best clinical
results. Despite attempts at cost-containment from both governments and
insurers, we believe such products should continue to result in excellent
profit margins for the industry.
We also continue to see increased cost-containment acting as an incentive for
a number of mergers and acquisitions among health care companies. These
activities have been most beneficial to shareholders, a trend we fully expect
to continue.
While many health care stocks have temporarily underperformed the stock
market in the last six months, we are optimistic about the long-term
prospects for the industry and the Fund.
14
<PAGE>
GT GLOBAL HEALTH CARE FUND
GEOGRAPHIC ALLOCATION OF NET ASSETS
Asia-Pacific/Europe 1.5%
North America & Other 98.5%
[GRAPH]
Allocations will change based on current market conditions. A complete
listing may be found in the Financial Statements section of this report.
GT GLOBAL HEALTH CARE FUND
ALLOCATION OF NET ASSETS %
1997 1996
April 30 April 30
MEDICAL TECHNOLOGY & SUPPLIES 42.1 25.4
BIOTECHNOLOGY 30.7 14.0
PHARMACEUTICALS 21.8 33.3
HEALTH CARE SERVICES 2.4 20.1
CONSUMER SERVICES - 0.3
SHORT-TERM & OTHER 3.0 6.9
GT GLOBAL HEALTH CARE FUND
<TABLE>
<CAPTION>
% of
KEY PORTFOLIO HOLDINGS(7) Country Net Assets
<S> <C> <S>
AMGEN, INC. One of the largest and most profitable biotechnology companies, U.S. 7.6
Amgen's growth has been driven by its two flagship products: Epogen, which
stimulates production of red blood cells (used by kidney dialysis patients);
and Neupogen, a white blood cell stimulant (used for chemotherapy patients).
ADVANCED TECHNOLOGY LABS, INC. A leading maker of ultrasound machines. We U.S. 6.0
believe the company stands to benefit as capital expenditure by U.S. hospitals
is beginning to accelerate.
PROTEIN DESIGN LABS, INC. A late-stage biotechnology company, best known for U.S. 5.9
its Zenapax drug, developed for patients undergoing organ transplants.
VISX, INC. Develops and manufactures excimer laser systems designed to recontour U.S. 5.2
the front surface of the cornea of the human eye to reduce or eliminate dependence
on corrective lenses. These systems are designed to treat refractive disorders
such as myopia, astigmatism and hyperopia with a procedure known as photorefractive
keratectomy.
BIOCHEM PHARMA, INC. A pharmaceutical company specializing in the research, CANADA 4.7
development, manufacturing and marketing of high-quality products for the prevention,
treatment and detection of human diseases. Currently under development are tests
for detecting infectious diseases, new vaccines and compounds for treating immune
system diseases.
WATSON PHARMACEUTICALS, INC. A leading manufacturer of specialty generic U.S. 4.7
pharmaceuticals.
MENTOR CORP. One of two remaining producers of breast implants, Mentor is U.S. 4.4
developing a device that performs ultronic liposuction, which is much safer than
traditional techniques.
THERATECH, INC. Develops advanced, controlled-release drug delivery products U.S. 3.9
that administer drugs through the skin, by oral delivery to the gastrointestinal
tract, through tissues in the oral cavity and by other means. The company is most
widely recognized as the producer of the testosterone patch and currently has over
20 products in development that span a wide variety of delivery technologies and
therapeutic areas.
GUILFORD PHARMACEUTICALS, INC. Researches, develops and commercializes drugs U.S. 3.5
for the treatment of cancer and other diseases. The company also manufactures
therapeutic and diagnostic products for neurological disease and conditions.
CATALYTICA, INC. Develops catalysts and catalytic systems and processes used U.S. 2.2
in minimizing environmental pollution. The systems and processes are also designed
to lower manufacturing costs for pharmaceutical companies.
</TABLE>
Source: Bloomberg
(7) There is no assurance the Fund will continue to hold these or any other
securities mentioned in this report.
15
<PAGE>
INVESTMENT OBJECTIVE
AND CURRENT STRATEGY
The Fund seeks long-term growth of capital by investing in equity securities
of companies in established and emerging economies throughout the world that
design, develop or provide products and services necessary for creating and
maintaining a country's infrastructure. We continue to focus a sizable
portion of our attention on companies in emerging markets based on our belief
that the bulk of rapid infrastructure growth is in emerging nations.
GT GLOBAL INFRASTRUCTURE FUND
PERFORMANCE SUMMARY
CLASS A SHARES
MSCI World Index GT Global Infrastructure Fund
10000 9525
9974 9567
10165 9992
10473 10400
10200 10325
10492 10392
10039 10042
10138 9817
9987 9567
10135 9308
10626 9133
10998 9625
11094 10000
11093 10292
11650 10750
11393 10583
11727 10600
11544 10092
11947 10267
12299 10417
12524 10725
12602 10833
12814 10942
13118 11742
13131 12033
13200 12183
12736 11650
12885 11917
13392 12167
13488 12008
14246 12475
14020 12767
14192 13248
14357 13064
14076 12854
14538 12732
CLASS B SHARES
MSCI World Index GT Global Infrastructure Fund
10000 10000
9974 10044
10165 10481
10473 10901
10200 10822
10492 10892
10039 10525
10138 10271
9987 10017
10135 9738
10626 9554
10998 10061
11094 10446
11093 10752
11650 11225
11393 11041
11727 11050
11544 10525
11947 10700
12299 10857
12524 11164
12602 11277
12814 11382
13118 12213
13131 12511
13200 12660
12736 12100
12885 12371
13392 12633
13488 12458
14246 12931
14020 13228
14192 13724
14357 13531
14076 13310
14538 12882
The charts above show the performance of the GT Global Infrastructure Fund
Class A and Class B shares since the Fund's inception versus the MSCI World
Index. The chart assumes a hypothetical $10,000 initial investment in Class A
shares and reflects all Fund expenses and the maximum 4.75% sales charge. For
Class B shares, results reflect all Fund expenses and the applicable
contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years), assuming a complete redemption at the end of the period. A
$10,000 investment in Advisor Class shares at inception on June 1, 1995,
would have been worth $12,885 on April 30, 1997.
AVERAGE ANNUAL TOTAL RETURNS %(1)
APRIL 30, 1997
<TABLE>
<CAPTION>
Share Class Without Sales Charge(2) With Sales Charge
1-Year Life of Fund 1-Year Life of Fund
<S> <C> <C> <C> <C>
Class A(3) 8.43 10.47 3.28 8.64
Class B(3) 7.93 9.94 2.93 9.07
Advisor Class(4) 9.27 14.15 N/A N/A
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
5.0% contingent deferred sales charge for Class A and Class B shares,
respectively, which if included, would have reduced performance
quoted.
(3) The Fund began operations on May 31, 1994.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial
institutions and other entities that have entered into specific
agreements with GT Global. Please see the "Alternative Purchase Plan"
section in the Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
From time to time, the Fund's Investment advisor may waive some fees and/or
reimburse some expenses, without which performances would be lower. Waiver
and reimbursements are subject to change.
16
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND
INTERVIEW WITH THE MANAGEMENT TEAM
Q HOW DID THE FUND PERFORM?
A For the six months ended April 30, 1997, the Fund's total return was
6.02% for Class A shares (0.99% including the maximum 4.75% sales charge) and
5.80% for Class B shares (0.80% including the maximum 5% contingent deferred
sales charge). Over the same investment period, the Morgan Stanley Capital
International (MSCI) World Index returned a total of 7.79%.(5) The index is
designed to represent the performance of all markets, however, and does not
reflect the Fund's concentration in infrastructure industries.
Q WHAT FACTORS AFFECTED THE FUND'S PERFORMANCE?
A The Fund's returns were supported by general strength in Latin American
markets and by privatizations, particularly in Brazil, where our investments
in power companies have done very well. Brazil's Cemig and Light
Participacoes were the two largest positive contributors to the Fund's
performance. Selective companies in the U.S., Finland, Spain, Greece,
Australia and India also benefited the Fund.
Among factors that detracted from performance, the most disappointing returns
over the period were from DSP Communications (a leading provider of chip sets
in the U.S. that supplies Japanese wireless handset manufacturers, excluding
NTT), a company that performed well last year. Lately, they have been hit
particularly hard by a drop-off in Japanese orders. As NTT has gained market
share, DSP's customer base has suffered and, accordingly, so has the demand
for DSP's products. DSP has also been impacted by the need to upgrade its
technology, which has necessitated considerable expenditure.
Q HOW HAVE THE EMERGING MARKETS FARED OVER THE PERIOD?
A Virtually all Latin American bourses have enjoyed good returns over the
past six months. Foreign capital returned to Argentina, where it became clear
that strong economic growth is boosting the government's financial position,
and several bond issues during the quarter were well received.
In Brazil, investors overlooked a burgeoning current account deficit to focus
on falling inflation and progress towards privatization. Encouraged by patchy
economic recovery (and repayment of the last of the emergency funding
borrowed by the government at the time of the January 1995 peso crisis),
foreign investors returned to Mexico. Not for the first time, the main
exception to good news was Venezuela, where public sector strikes
overshadowed all else.
A number of developments in certain emerging markets of Asia, however,
hampered performance, although successful infrastructure investments in Hong
Kong and India offset some of the declines. Sentiment in East Asia, for the
most part, was dampened by concerns that the tightening of monetary policy by
the U.S. Federal Reserve (specifically, a rise in the Fed funds rate from
5.25% to 5.50% on March 25) represented the first in a series of interest
rate rises.
Philippine and Malaysian markets generally trended down. Sentiment in Korea
was depressed by high-profile bankruptcies of several of its largest steel
companies, and the continuing problems of Thailand's property and finance
sectors were the main reasons for falls in share prices there. The Hong Kong
market also ended slightly down for the six months, primarily on the back of
a correction in the property sector, which had outperformed during calendar
1996.
Q COULD YOU DESCRIBE YOUR INVESTMENT STRATEGY?
A The basic strategy of the Fund is to find infrastructure opportunities
at attractive valuations. We use a number of measures to determine value,
including price-to-earnings relative to earnings growth rate,
price-to-replacement value and price-to-cash flow ratios.
No major shifts have occurred in the Fund's strategy, essentially due to the
nature of the industry. Infrastructure development tends to take place over a
long period of time, with the exception of the telecommunications sector
where dramatic changes from a technological or regulatory perspective can
occur quickly. In most other infrastructure sectors we remain focused on
finding companies we think will grow with the pace of infrastructure
development around the world.
Q LOOKING AHEAD, WHERE DO YOU EXPECT TO FIND OPPORTUNITIES?
A First and foremost, the global financial environment remains benign.
With real yields of 5%, U.S. Treasuries are unlikely to be sold down much
further, implying the U.S. stock market, although fully valued, has limited
downside. The absence of inflationary pressures in CONTINUED P18
(5) The MSCI World Index is a market value-weighted average of the
performance of 1,554 securities listed on the major world stock
exchanges - the U.S., Europe, Canada, Australia, New Zealand and the
Far East. It includes the effect of reinvested dividends and is
measured in U.S. dollars.
The index is unmanaged, not available for direct investment and does not
include the effects of sales charges and professional management fees.
17
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
the U.S. suggests interest rates are unlikely to increase by much, if at all.
Unlike 1994, real short-term U.S. dollar interest rates, at over 3.5%, are
already comparatively high.
Except in the UK, European central banks appear unlikely to lift interest
rates any time soon. Easy money assists growth, exporters (by way of
softening currencies) and chances of participation in European Monetary Union
(EMU).
We find additional reasons to be bullish about emerging markets. In most
cases, major indices are still below their 1994 highs, while in relation to
their own past and developed markets, emerging markets generally appear
undervalued. Latin American economies, for example, are emerging from the
deep recession that followed the 1995 peso crisis in Mexico.
In Asia, we still see attractive themes throughout the region. Infrastructure
development in Malaysia, the economic upturn in China and reform in the
Philippines are three themes we are exploiting. Above all, as the general
strength of the (hugely diverse) emerging European, Middle East and African
(EMEA) markets over the recent past suggests, investors are alert to
opportunities that develop when particular countries embark on the initial
stages of economic reform.
Although they can be volatile over the short term, emerging economies
continue to stand out as areas of significant potential. As these nations
enjoy increasing stability and economic growth, we anticipate their needs for
infrastructure development to accelerate. We are also attracted by capital
goods producers (power plants and other infrastructure building blocks) we
believe stand to benefit from an increase in demand for equipment to build
emerging market infrastructure.
In general, we continue to like the growth of telecom, the stability of
electric utilities, the sales potential of the capital goods side and the
rationalization opportunities in transportation. Moreover, we believe
privatizations, whereby entrepreneurial and managerial skills are applied to
formerly state-run companies, can lead to improved returns, which often make
them attractive investments.
GT GLOBAL INFRASTRUCTURE FUND
ALLOCATION OF NET ASSETS %
1997 1996
APRIL 30 APRIL 30
SERVICES 26.1 25.7
ENERGY 25.6 27.9
MATERIALS/BASIC INDUSTRY 16.5 14.5
CAPITAL GOODS 13.1 17.1
MULTI INDUSTRY/MISC. 4.2 4.6
TECHNOLOGY 2.1 7.7
CONSUMER DURABLES 1.1 -
SHORT-TERM & OTHER 11.3 2.5
18
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND
GEOGRAPHICAL ALLOCATION OF NET ASSETS
Middle East/Africa 8.3%
Latin America 15.4%
Asia-Pacific 17.1%
Europe 22.6%
U.S. & Canada 36.6%
[GRAPH]
Allocations will change based on current market conditions. A complete
listing may be found in the Financial Statements section of this report.
GT GLOBAL INFRASTRUCTURE FUND
<TABLE>
<CAPTION>
% of
KEY PORTFOLIO HOLDINGS(6) Country Net Assets
<S> <C> <C>
LIGHT PARTICIPACOES S.A. Lightpar is a holding company that resulted from the demerger BRAZIL 3.0
of Light Servicos de Eletricidade. After the split of Light Servicos, Lightpar
maintained control of the Sao Paulo Electric utility Eletropaulo.
DONCASTERS PLC Manufactures highly engineered components used primarily in the UK 3.0
aerospace and industrial gas and steam turbine industries.
LA CEMENTOS NACIONAL Ecuador's largest cement manufacturer, with a greater than 60% ECUADOR 3.0
market share. As a subsidiary of Holderbank, the Swiss cement giant, the company
boasts one of the best management teams in the region and holds a virtual monopoly in
much of its territory. Trades at a large discount to comparable cement companies in
Latin America.
MANNESMANN AG Through its subsidiaries, the company manufactures plant and GERMANY 2.8
machinery equipment, automotive technology and electronic engineering. The company
also provides telecommunication services, produces tubes and pipes, and engages in
trading and other activities.
LIGHT - SERVICOS DE ELETRICIDADE Generates, transmits and distributes electric BRAZIL 2.8
power to the state of Rio de Janiero.
GIANT CEMENT HOLDING, INC. Manufactures portland and masonry cement for U.S. 2.8
residential, commercial and infrastructure construction markets. The company owns
and operates two limestone quarries and manufacturing facilities through its wholly
owned subsidiaries, Giant Cement and Keystone Cement.
EMPRESA NACIONAL DE ELECTRIDAD (ENDESA) Produces and distributes electricity. SPAIN 2.7
TRANZ RAIL HOLDINGS LTD. A multi-mode freight transport and distribution NEW ZEALAND 2.6
company in New Zealand. The company operates a commercial railroad as well as ferry
services between the north and south islands of New Zealand.
CATERPILLAR, INC. Designs, manufactures and markets earthmoving, construction U.S. 2.6
and materials handling machinery. Products are sold through a worldwide network of
independent dealers.
ENRON GLOBAL POWER & PIPELINES Owns and manages the non-United States power U.S 2.5
plant and natural gas pipeline operations of Enron Corporation. The company's
interests consist of two power plants in the Philippines, a power plant in
Guatemala and a natural gas pipeline system in Argentina.
</TABLE>
Source: Bloomberg
(6) There is no assurance the Fund will continue to hold these or any
other securities mentioned in this report.
19
<PAGE>
INVESTMENT OBJECTIVE AND CURRENT STRATEGY
The Fund seeks long-term growth of capital by investing in equity securities
of companies worldwide that own, develop or explore natural resources, or
that supply goods and services to such companies. Natural resources companies
include those that own, explore or develop ferrous and non-ferrous metals,
strategic metals and precious metals, chemicals, forestry products,
foodstuffs, refined products such as steel, and other basic commodities. The
Fund seeks to invest in companies we believe have potential earnings growth
that outpaces expectations, such as those growing their reserves quickly by
making new discoveries or increasing production.
GT GLOBAL NATURAL RESOURCES FUND
PERFORMANCE SUMMARY
MSCI World Index GT Global Natural Resources Fund A
10000 9525
9974 9358
10165 9658
10473 10142
10200 10475
10492 10342
10039 9783
10138 9691
9987 9098
10135 8989
10626 9023
10998 9441
11094 9566
11093 9624
11650 10142
11393 10009
11727 9917
11544 9558
11947 9950
12299 10375
12524 10878
12602 11658
12814 12212
13118 13235
13131 13721
13200 13034
12736 12581
12885 13587
13392 14376
13488 14627
14246 15181
14020 15271
14192 15376
14357 13577
14076 12874
14538 12370
MSCI World Index GT Global Natural Resources B
10000 10000
9974 9825
10165 10131
10473 10630
10200 10971
10492 10831
10039 10245
10138 10143
9987 9512
10135 9407
10626 9433
10998 9862
11094 9994
11093 10047
11650 10581
11393 10441
11727 10345
11544 9959
11947 10371
12299 10799
12524 11325
12602 12132
12814 12694
13118 13755
13131 14264
13200 13536
12736 13071
12885 14106
13392 14922
13488 15176
14246 15738
14020 15824
14192 15924
14357 14060
14076 13324
14538 12497
The charts above show the performance of the GT Global Natural Resources Fund
Class A and Class B shares, since the Fund's inception, versus the MSCI World
Index. The chart assumes a hypothetical $10,000 initial investment in Class A
shares and reflects all Fund expenses and the maximum 4.75% sales charge. For
Class B shares, results reflect all Fund expenses and the applicable
contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years), assuming a complete redemption at the end of the period. A
$10,000 investment in Advisor Class shares at inception on June 1, 1995 would
have been worth $13,059 on April 30, 1997.
AVERAGE ANNUAL TOTAL RETURNS %(1)
APRIL 30, 1997
Share Class Without Sales Charge(2) With Sales Charge
1-Year Life of Fund 1-Year Life of Fund
Class A(3) -6.54 9.38 -10.98 7.57
Class B(3) -6.97 8.83 -11.46 7.95
Advisor Class(4) -6.03 14.95 N/A N/A
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
contingent deferred sale charge (5% in the first year, decreasing to 0%
after six years) for Class A and Class B shares, respectively, which if
included, would have reduced performance quoted.
(3) The Fund began operations on May 31, 1994.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial institutions
and other entities that have entered into specific agreements with
GT Global. Please see the "Alternative Purchase Plan" section in the
Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
From time to time, the Fund's investment advisor may waive some fees and/or
reimburse some expenses, without which performance would be lower. Waivers
and reimbursements are subject to change.
20
<PAGE>
GT GLOBAL NATURAL RESOURCES FUND
INTERVIEW WITH PORTFOLIO MANAGER
DEREK WEBB
Q HOW DID THE FUND PERFORM?
A While the natural resources environment has been a difficult one over the
last six months, we remain bullish about the long-term opportunities for this
sector. With respect to the Fund's performance, general market volatility
coupled with a lagging energy sector precipitated a fall in the Fund's
returns.
For the six months ended April 30, 1997, total return was -15.43% for Class A
shares (-19.45% including the maximum 4.75% sales charge) and -15.68 for
Class B shares (-19.75% including the effect of the maximum 5% contingent
deferred sales charge). During the same period, the Morgan Stanley Capital
International (MSCI) World Index(5) returned 7.79%. The index is designed to
represent the performance of all markets, however, and does not reflect the
Fund's concentration in natural resources industries.
Q COULD YOU PROVIDE FURTHER EXPLANATIONS ABOUT THE CAUSE OF WEAKNESS IN THE
FUND'S PERFORMANCE?
A The decline in the Fund's performance has occurred primarily on the back of
a selloff in oil service stocks, which fell 20%-30% over the first quarter.
With the fall in hydrocarbon prices (oil prices have fallen from $25 to $20 a
barrel and natural gas prices from $3.20 to $1.90), investors became nervous
and sold the stocks down, even though earnings per share were rising. During
the selloff we held a 45% weighting in these energy service companies, which
had a significant impact on the Fund. We subsequently reduced the Fund's
position in this sector to attempt to reduce volatility.
However, we remain bullish on the oil service sector overall because
fundamentals have actually continued to improve. The sector has been going
through a substantial recovery in earnings and cash flow after being in a
recession for 15 years and, contrary to perceptions, we believe their
business is not dependent on hydrocarbon pricing in the short term. When oil
companies budget new projects, they don't look where prices are today, but
take a longer-term approach. So, in our opinion, the fall in share prices of
these companies is unjustified, and their earnings and cash flow should
continue to grow better than any other sector within the natural resources
industry, based on increased demand for equipment and decreases in supply.
The recent selloff in growth stocks also negatively affected the Fund. Our
focus on natural resource growth stocks did not spare us from the general
selloff in growth stocks. In addition, commodity prices, such as oil, gas,
gold, forest products, chemicals, base metals and steel, are at depressed
levels.
Q BRE-X HAS BEEN IN THE HEADLINES OVER THE LAST SEVERAL MONTHS. HOW MUCH OF
AN IMPACT DID THE SCANDAL HAVE ON PERFORMANCE?
A We owned Bre-X for roughly a year-and-a-half because it was increasing
expected gold reserves faster than any other gold company in the world, and
analysts continued to raise their forecasts. We began to sell the stock prior
to the collapse in the share price because its relative strength was
deteriorating. Although we did not know CONTINUED P22
WORLDWIDE CHANGES IN MINING LAWS FROM 1987 - 1993
[GRAPHIC]
With new markets opening up and the reform of many nations' mining laws, we
believe the supply of attractive opportunities in natural resources
industries can continue to increase.
Source: Yorkton Securities
(5) The MSCI World Index is a market value-weighted average of the performance
of 1,554 securities listed on major world stock exchanges- the U.S., Europe,
Canada, Australia, New Zealand and the Far East. It includes the effect of
reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and does not incur
sales charges and professional management fees.
21
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
why it had started to underperform the market, we
interpreted it as a signal of a potential problem.
The important point is that we exercised strict discipline throughout. We
purchased the company on the basis of expected reported reserves growth and
sold when the relative strength deteriorated.
Over the entire 18-month period we owned Bre-X, we neither made nor lost
money on the stock. Looking at the six-month period to April 30, however,
because the stock came down from extremely high levels, it cost the Fund
about three percentage points. Fortunately, these kinds of events are rare
occurrences.
Again, in terms of repercussions on exploration shares, we believe industry
fundamentals have not changed. Exploration shares have simply become cheaper.
Valuations have declined substantially and, as a result, we see good buying
opportunities.
Q COULD YOU DESCRIBE YOUR INVESTMENT STRATEGY?
A Our investment criteria for any company are very disciplined. We look for
companies growing their reserves and/or earnings quickly, faster than
expectations, and for which analysts are constantly raising their earnings
and/or reserves forecasts. Companies must also display strong fundamentals,
such as high return on equity, low debt, and high relative strength.
Based on our consistent investment process, any time a company comes into
conflict with one of our investment criteria, we will generally reduce our
holdings.
Q WHAT IS YOUR OUTLOOK GOING FORWARD?
A Our largest weighting is in the energy services area. This area is
experiencing a significant increase in demand after being in a recession for
15 years. Here we own companies like Schlumberger and Energy Ventures. Our
next largest weighting is in the energy production area. Outside the oil
sector, most commodity prices are currently at depressed levels. Gold,
chemical, forest products and steel prices are at lows, while base metals
continue to bump along in an average trading range.
As part of our investment strategy, we also look for companies undergoing
substantial restructuring and/or cost-cutting. For example, we are invested
in the Canadian company Brascan because it's going through major
restructuring and merging with a company called Edper. We own another
company, Pacific Forest Products, not because we're particularly bullish on
forest products pricing, but because the company is being turned into a
royalty trust (a trust set up for tax purposes that owns the rights to
royalties from timber harvests), and we expect the price to go up as a result
of changes in the company's structure.
We remain bullish on natural resources, as positive changes continue to take
place around the world. Demand continues to be robust in emerging markets
and, in addition, growth appears to be synchronizing in the developed world,
which we believe is likely to drive commodity prices higher. Growth in the
U.S. has been strong for a number of years, but it's just beginning to pick
up in Europe and Japan. If all three were to grow simultaneously this year,
we believe we could see substantially higher commodity prices and stock
reratings.
EXPECTED GROWTH IN DEMAND FROM
EMERGING MARKETS
Growth Rate % of Incremental
1992-2005e Demand Growth
OECD ROW* OECD ROW
Liquid Fuels 0.8% 2.1% 30% 70%
Solid Fuels 0.7 1.8 18 32
Copper (Refined) 1.5 3.4 41 59
Aluminum (Primary) 1.3 4.0 37 63
Steel 0.0 1.9 0 100
Average 0.8% 2.6% 25% 75%
DEMAND FOR NATURAL RESOURCES IS EXPECTED TO DERIVE PRIMARILY FROM EMERGING
ECONOMIES AS THEY CONTINUE TO DEVELOP.
* Organization for Economic Cooperation and Development, Rest of World;
Source: JP Morgan
GT GLOBAL NATURAL RESOURCES FUND
ALLOCATION OF NET ASSETS %
1997 1996
April 30 April 30
Energy Equipment & Services 20.1 30.4
Oil 13.6 12.6
Gold 7.1 16.2
Chemicals 6.0 6.5
Forest Products 5.7 --
Misc. Materials & Commodities 5.0 --
Metals-Steel 5.0 9.4
Metals-Non-Ferrous 3.8 13.6
Gas Production & Distribution 1.8 5.8
Machinery & Engineering -- 3.2
Misc./Short-Term & Other 31.9 2.3
22
<PAGE>
GT GLOBAL NATURAL RESOURCES FUND
GEOGRAPHIC ALLOCATION OF NET ASSETS
Africa 0.7%
Europe 3.4%
Asia-Pacific 8.7%
Canada 23.0%
U.S. & Other 64.2%
Allocations will change based on current market conditions.
A complete listing may be found in the Financial Statements
section of this report.
GT Global Natural Resources Fund
Key Portfolio Holdings(6)
% of
Country Net Assets
OROGEN MINERALS LTD. An investment company that AUSTRALIA 4.7
controls stakes in Papua, New Guinea, resource companies,
Orogen has a portfolio of assets developed by
subsidiaries of major international resources
companies. It also has interests in oil development,
producing oil fields, gold mines and gold deposits.
COOPER CAMERON CORP. Manufactures, markets and services U.S. 3.7
production equipment for the oil and gas industry
including pressure control equipment such as wellheads
and gate and ball valves, undersea production systems and
compression and power equipment. Cooper Cameron sells its
products to oil and gas producers as well as to transmitter
companies and non-utility power generators.
PACIFIC FOREST PRODUCTS LTD. A British Columbia-based CANADA 3.6
forest products company in the business of growing
trees and producing premium wood products for Japan
and other international markets. Pacific Forest has assets
which include sawmills, private timberlands and Crown Timber
tenures on Vancouver Island.
CIBA SPECIALTY CHEMICALS Develops, manufactures and SWITZERLAND 3.4
markets chemical products such as additives for
plastics, brighteners for detergents, polymers for
adhesives and dyes for textiles. The company manufactures
and sells its products worldwide.
UCAR INTERNATIONAL, INC. Manufactures graphite and U.S. 3.3
carbon electrodes throughout the world. Graphite
electrodes are used in the production of steel,
while carbon electrodes are primarily used to produce
silicon metal, which is used to manufacture aluminum.
SAVAGE RESOURCES LTD. Explores for and produces AUSTRALIA 3.3
minerals, including coal, copper and gold. The company
also mines and refines zinc.
PATTERSON ENERGY, INC. An energy company that provides U.S. 3.2
onshore contract drilling of oil and natural gas.
Patterson also explores for, develops and produces oil
and gas.
SCHLUMBERGER LTD. Offers drilling, oil well logging and U.S. 3.0
measurement-while-drilling services to the petroleum industry.
It also manufactures computer-aided design systems, electricity
and gas meters, power transmission equipment and electronic
payment systems for sale worldwide.
FREEPORT MCMORAN COPPER & GOLD Through its subsidiary, the U.S. 2.9
company is involved in mineral exploration and development,
mining and milling of copper, gold and silver in Irian Jaya,
Indonesia. It is also involved in the smelting and refining
of copper concentrates in Spain and a joint venture to construct
and operate a smelter/refinery in Indonesia.
ENERGY VENTURES, INC. Offers oil and gas drilling services U.S. 2.8
for exploration companies, including workover and
completion services on offshore rigs. The company manufactures
oil well equipment and explores for and develops oil and gas
in Louisiana, Oklahoma and Texas.
Source: Bloomberg
(6) There can be no assurance the Fund will continue to hold these or any other
securities mentioned in this report.
23
<PAGE>
INVESTMENT OBJECTIVE AND CURRENT STRATEGY
The Fund seeks long-term growth of capital by investing primarily in equity
securities of companies throughout the world engaged in the development,
manufacture or sale of telecommunications services or equipment. The Fund's
strategy is to invest in companies that, in our opinion, are fast growing and
innovative, including equipment providers, wireless services and emerging
market telecommunications companies.
GT GLOBAL TELECOMMUNICATIONS FUND
PERFORMANCE SUMMARY
MSCI MSCI Salomon GT Global
World Index Telecommunications Global Telecom Telecommunications A
10000 10000 10000 9525
10054 9906 9867 9467
9882 9771 10137 9617
9418 9529 9870 9533
9551 10159 10296 9608
9933 10240 10530 9767
9602 10174 9879 9342
9628 10519 10346 9467
9864 10506 10407 9300
9775 10316 10070 9050
9512 10082 10006 9300
9684 10440 10331 9733
9764 10865 10715 9987
9799 10936 10715 10266
10033 11412 11038 10527
10616 11775 12082 10696
11110 11559 12100 10865
11368 12037 12549 11355
11275 12305 12584 11827
11509 12425 12904 12258
12038 13153 13806 13364
11818 12945 13581 13583
12145 13511 14252 14284
11460 12800 13436 13549
12023 13032 14315 14746
12818 13624 15453 15399
12654 12736 14620 14944
12111 12353 13826 14025
12487 12774 13962 14257
12521 12865 13898 14179
12489 12823 13770 13819
12728 13225 14330 14480
13114 13661 15094 15253
12772 13288 14658 14892
13137 13601 14840 15287
12570 12693 13874 14617
12694 12682 13618 14097
12506 12991 13376 13400
12690 13007 12909 13129
13305 13287 13509 13074
13771 13484 13863 13572
13891 13716 13890 13789
13890 13970 14126 14594
14588 14330 14681 15653
14265 14685 14901 15997
14684 15591 15306 16024
14455 15439 14817 14848
14960 15571 15051 15291
15400 16091 15386 15307
15681 16405 15717 16011
15780 16304 15593 16173
16045 16098 15565 16202
16425 16651 16183 17601
16442 16513 16141 18115
16528 16508 16259 17449
15947 15437 15447 15173
16134 15550 15759 16268
16768 15770 15958 16497
16888 16121 16137 15887
17838 17036 16990 16411
17555 17460 17544 16108
17770 17672 18032 17031
17977 17901 18255 15953
17625 17379 18139 15538
18204 17610 18494 15601
MSCI MSCI Salomon GT Global
World Index Telecommunications Global Telecom Telecommunications B
10000 10000 10000 10000
10377 9801 9839 10150
10618 10207 10204 10599
10531 10434 10232 11041
10750 10536 10492 11435
11244 11153 11226 12461
11038 10976 11043 12658
11344 11457 11588 13304
10704 10854 10925 12618
11230 11050 11640 13720
11972 11552 12565 14322
11819 10799 11888 13897
11312 10475 11243 13038
11663 10831 11353 13247
11695 10909 11301 13167
11665 10873 11197 12830
11889 11214 11652 13432
12249 11583 12273 14154
11929 11267 11919 13801
12271 11533 12066 14170
11741 10763 11281 13544
11857 10754 11073 13049
11681 11016 10876 12406
11853 11029 10497 12144
12427 11267 10985 12093
12863 11434 11273 12550
12975 11631 11294 12744
12974 11846 11486 13489
13625 12151 11937 14453
13324 12452 12116 14766
13715 13220 12446 14782
13502 13091 12048 13692
13973 13203 12238 14097
14384 13644 12511 14104
14647 13911 12780 14745
14739 13825 12679 14887
14987 13650 12656 14905
15342 14119 13159 16187
15358 14002 13124 16650
15438 13997 13220 16036
14895 13089 12561 13934
15069 13185 12814 14940
15662 13372 12976 15136
15774 13669 13121 14575
16661 14446 13815 15056
16397 14805 14266 14764
16598 14984 14662 15609
16791 15179 14844 14608
16462 14736 14749 14220
17003 14932 15038 14278
The charts above show the performance of the GT Global Telecommunications
Fund Class A and Class B shares since the Fund's inception, versus its
various indices. The chart assumes a hypothetical $10,000 initial investment
in Class A shares and reflects all Fund expenses and the maximum 4.75% sales
charge. For Class B shares, results reflect all Fund expenses and the
applicable contingent deferred sales charge (5% in the first year, decreasing
to 0% after six years), assuming a complete redemption at the end of the
period. A $10,000 investment in Advisor Class shares at inception on June 1,
1995, would have been worth $11,424 on April 30, 1997.
AVERAGE ANNUAL TOTAL RETURNS %(1)
APRIL 30, 1997
<TABLE>
<CAPTION>
Share Class Without Sales Charge(2) With Sales Charge
1-Year 5-Year Life of Fund 1-Year 5-Year Life of Fund
<S> <C> <C> <C> <C> <C> <C>
Class A(3) -11.36 10.18 9.84 -15.58 9.11 8.83
Class B(3) -11.79 N/A 9.12 -15.84 N/A 8.75
Advisor Class(4) -10.87 N/A 7.20 N/A N/A N/A
</TABLE>
HISTORICAL PERFORMANCE(2)
ANNUAL TOTAL RETURNS % (PER CALENDAR YEAR)
1992 1993 1994 1995 1996
Class A 4.85(3) 47.65 -4.40 8.58 5.24
Class B N/A 37.20(3) -4.89 8.08 4.68
(1) Figures assume reinvestment of all dividends and capital gain
distributions at net asset value.
(2) Performance data do not reflect the maximum 4.75% sales charge and the
contingent deferred sales charge (5% in the first year, decreasing to 0%
after six years) for Class A and Class B shares, respectively, which, if
included, would have reduced performance quoted.
(3) The Fund began operations on January 27, 1992; Class B shares commenced on
April 1, 1993.
(4) The Fund began offering Advisor Class shares on June 1, 1995. Advisor
Class shares are not sold directly to the general public and are only
available through certain employee benefit plans, financial institutions
and other entities that have entered into specific agreements with
GT Global. Please see the "Alternative Purchase Plan" section in the
Fund's prospectus.
The above data represent past performance of the Fund's shares, which does
not guarantee future results. The investment return and principal value of an
investment in the Fund will fluctuate, so that an investor's shares, when
redeemed, may be worth more or less than their original cost.
24
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
INTERVIEW WITH LEAD PORTFOLIO MANAGER
MICHAEL MAHONEY
Q HOW DID THE FUND PERFORM?
A The Fund's performance was adversely impacted by the downturn in
telecommunications technology. For the six months ended April 30, 1997, the
Fund's total return was -1.81% for Class A shares (-6.47% including the
maximum 4.75% sales charge) and -2.04% for Class B shares (-6.53% including
the maximum 5% contingent deferred sales charge). Total return over the same
investment period was 9.24% for the MSCI Telecommunications Index(5) and
7.79% for the MSCI World Index.(6) The more comprehensive Salomon Brothers
Global Telecommunications Index,(7) which has a component of emerging market
stocks, returned 14.61% over the period.
Relative to its benchmarks, the Fund suffered as a result of its exposure to
telecommunications technology, which is not represented in either the MSCI
Telecommunications Index or the Salomon Brothers Global Telecommunications
Index.
Q IS TELECOMMUNICATIONS TECHNOLOGY BECOMING MORE ATTRACTIVE?
A In general, technology has been hit hard in the first quarter of this year
on the back of a slowdown in demand for networking products. Having earlier
reduced our tech exposure because of valuation concerns, we are now growing
more optimistic as valuations are becoming more attractive. We see promising
developments in the wireless infrastructure area, as well as in a number of
other areas including switching, transmission equipment and some of the basic
wireline infrastructure stocks.
However, we have limited exposure in networking stocks. In general, while we
think networking is promising over the long term, we are waiting for a
clearer picture of competitive concerns and the resumption of rapid demand
growth.
Q WHAT ARE THE REPERCUSSIONS OF DEREGULATION IN THE U.S. TELECOMMUNICATIONS
INDUSTRY?
A Although deregulation legislation in the telecommunications industry was
passed a little over a year ago, we've been disappointed by the delay in
results. A number of court challenges have been mounted, and the FCC has had
its hands full because specific provisions were omitted from the legislation.
In fact, a number of provisions were left intentionally vague in order to get
the bill passed.
However, increasing political pressure is pushing the FCC to move things ahead,
and we expect some decisions will be forthcoming. The key from an investment
perspective is timing--when will the log jam be broken and how soon will the
market perceive that competition is moving forward? In our opinion, the real
catalyst for a change in thinking will be FCC acceptance of one of the Regional
Bell Operating Companies' (RBOC) petitions for long distance, which we believe
has a good chance of occurring in the second half of the year. This
CONTINUED P26
THE RUSSIAN TELECOMMUNICATIONS SECTOR
UNTAPPED POTENTIAL
POPULATION: 148.1 MILLION
REAL GDP GROWTH (ANNUAL % CHANGE):
1997e 1992-94 AVG
1% -11.5%
EXTERNAL DEBT (% OF GDP):
1997e 1992-94 AVG
25% 52%
RUSSIA IS RICHLY ENDOWED (% WORLD SHARE)
Gas Exports: 40%
Oil Output: 9.4%
Coal Reserves: 11.7%
Nickel Output: 23%
Source: The Russian Federation, JP Morgan
ACCESS LINES PER 100 PEOPLE 1996
Russia 18
UK 47
Moscow ('95) 48
Japan 56
U.S. 56
Tokyo ('95) 65
New York ('95) 71
At the end of 1996, there were approximately 26 million telephone lines in
Russia with a waiting list of 10 million for telephone line installation. As
Russia continues to develop, we anticipate the telecommunications sector will
prosper.
The Fund holds the following Russian Telecommunications companies: RTDC,
Rostelecom and PLD Telecom
(5) The MSCI Telecommunications Index is a market value-weighted average of
the performance of 29 securities listed on 10 major stock exchanges. It
includes the effect of reinvested dividends and is measured in U.S. dollars.
(6) The MSCI World Index is a market value-weighted average of the performance
of 1,554 securities listed on major world stock exchanges- the U.S., Europe,
Canada, Australia, New Zealand and the Far east. It includes the effect of
reinvested dividends and is measured in U.S. dollars.
(7) The Salomon Brothers Global Telecommunications Index is a market value--
weighted average of the performance of 80 securities. It consists of
telecommunications companies with total adjusted market capitalizations of
US$100 million or more, including those in emerging markets. It includes
the effect of reinvested dividends and is measured in U.S. dollars.
Indices are unmanaged, not available for direct investment and do not incur the
effects of sales charges and professional management fees.
25
<PAGE>
INTERVIEW WITH THE PORTFOLIO MANAGER CONTINUED
could be particularly positive for a number of the Fund's
equipment stocks and also some of the service stocks.
Q IS THIS YEAR'S RALLY IN EMERGING MARKETS A SIGN OF BETTER TIMES?
A Emerging market telcos have enjoyed an encouraging start to this year. We
think the downtrend and sideways movement prominent in emerging markets over
the last three years has likely run its course. However, emerging markets'
telecom stocks remain particularly sensitive to changes in demand for
emerging market equities because they are typically the largest
capitalization stocks in any given market.
We've also seen positive developments in the competitiveness of some specific
emerging market telcos. The issue of declining accounting rates as a result
of FCC pressure remains, however, and we have avoided companies we think will
be affected, including some of the Asian telephone companies we believe may
be hit hard over time.
On the other hand, we find a number of Latin American companies attractive.
TeleMex (which we own through a holding company called Grupo Carso Telecom),
for example, has done better than many expected. The company has retained
market share as consumer long-distance balloting has taken place in various
Mexican cities. With the process of change in Mexico progressing at a
more-gradual-than-expected pace and competition developing slowly, we remain
cautiously optimistic on TeleMex's outlook.
Brazil's Telebras has also done well, enjoying a return of more than 50%
since the start of the year to the end of April. We are generally pleased
with the progress being made in Brazil on regulatory reform and with the
overall growth of the telecommunications industry there-cellular growth has
been outstanding and even landline growth has been quite impressive.
We continue to believe in the long-term opportunities emerging market
telecommunications stocks offer. While we find some specific stocks
unattractive because of FCC accounting rate issues, in most cases we think
valuations are attractive and believe investor concerns about the competitive
environment are overdone.
Q WHAT IS YOUR VIEW ON WIRELESS SERVICE OPERATORS?
ARE SHARES IN THESE COMPANIES ON THE REBOUND?
A While most European stocks have done well over the last six months,
wireless shares in Asia and the U.S. have continued to underperform other
telecom equities. However, against this 18-month period of poor performance,
we have seen some recent signs of improvement. As the introduction of new
competition has slowed in the U.S. (demonstrated recently by the bankruptcy
of one of the "C" band PCS licensees), some of the uncertainties and
near-term negatives surrounding these stocks appear to have tapered off.
Additionally, soon-to-be-announced regulatory changes in the U.S. may reduce
access fees wireless carriers pay to local phone companies, which could
significantly increase their profitability.
As a whole, we've been underweighted in U.S. wireless stocks, although we've
held some overseas wireless shares. Recently, however, we've become more
positive on some U.S. wireless service providers and feel there may be signs
of a turn in expectations for the group. A number of companies have reported
better-than-expected subscriber growth numbers, a development also promising
for wireless equipment companies whose shares have generally done well in the
difficult technology environment over the first quarter of this year.
Q WHAT IS YOUR OUTLOOK GOING FORWARD?
A While the telecommunications arena has been a difficult one over the last
couple of years, we remain optimistic about the industry's future and see
very attractive valuations now in almost every area in which we invest,
including most of the technology stocks we follow. For now we will
concentrate on selected equipment manufacturers and service providers in
cellular and emerging markets landline, seeking to produce stronger
performance over the remainder of the year.
GT GLOBAL TELECOMMUNICATIONS FUND
ALLOCATION OF NET ASSETS%
1997 1996
April 30 April 30
Telecom Equipment 29.0 23.1
Telephone Networks 24.7 16.0
Wireless Communications 18.0 20.2
Instrumentation & Test 2.8 --
Broadcasting & Publishing 2.7 6.5
Telephone - Regional/Local 2.2 5.3
Semiconductors 2.1 1.3
Aerospace/Defense 1.9 1.1
Telephone - Long-Distance 1.7 1.8
Multi-Industry/Misc. 1.5 4.1
Cable Television 1.3 6.9
Consumer Electronics 1.3 2.3
Telecom - Other 1.3 --
Telecom Technology -- 4.4
Networking -- 1.6
Industrial Components -- 1.3
Short-Term & Other 9.5 4.1
26
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
GEOGRAPHIC ALLOCATION OF NET ASSETS
Middle East 5.0%
Japan 5.1%
Asia-Pacific ex-Japan 7.0%
Latin America 11.1%
Europe 34.9%
North America & Other 36.9%
Allocations will change based on current market conditions.
A complete listing may be found in the Financial Statements section of this
report.
GT GLOBAL TELECOMMUNICATIONS FUND
KEY PORTFOLIO HOLDINGS(8)
% of
Country Net Assets
TELEBRAS Offers domestic and international telephone BRAZIL 6.9
and data transmission services throughout Brazil.
L.M. ERICSSON One of the world's premier SWEDEN 5.4
telecommunications equipment companies. Ericsson's
revenues derive primarily from its fast-growing radio
communications division, with the remainder coming from
its public telecommunications division and other
telecommunications and defense-related businesses. The
company enjoys product sales in over 100 countries.
NOKIA Manufactures and develops telecommunication FINLAND 4.8
systems and equipment. Nokia is the world's second-
largest, but fastest-growing, supplier of cellular
equipment.
ECI TELECOM The worldwide leader in digital circuit ISRAEL 3.8
multiplication equipment (DCME) products that, when
attached to various telecom transmission cables, increase
carrying capacity. ECI is also a leader in the development
of products for the SDH fiber optic environment that
multiplex, monitor and manage high-speed digital
transmission of voice and data.
DAINI DENDEN INC. (DDI) Japan's second-largest provider JAPAN 3.7
of cellular phone services, DDI also has a significant
share of the domestic long-distance market.
NEWBRIDGE NETWORKS CORP. Manufactures time division CANADA 3.5
multiplexer (TDM) products for telecom networks,
and packet switching products, particularly frame relay
asynchronous transfer mode (ATM), which boosts the
efficiency and capacity of existing networks. The company
controls half the world market for this technology.
MANNESMANN AG A diversified industrial conglomerate GERMANY 3.4
involved in telecommunications, machinery, plant
construction, automotive technology, tubes and pipes.
Mannesmann is the majority owner of Germany's
second-largest cellular company and also has investments
in Italian cellular and Spanish and French paging companies.
STET DI RISP The government-controlled holding company ITALY 3.3
of a telecommunications group of some 67 consolidated
subsidiaries. The company provides a wide range of
telecommunications services and is also involved in
production of equipment and systems for the industry and
the design and construction of telephone networks.
MILLICOM INTERNATIONAL CELLULAR SA Develops and LUXEMBOURG 2.9
operates cellular telephone networks through its joint
venture companies. The company also has interests in
cellular telephone systems in 20 countries.
SPT TELECOM The monopoly utility in the Czech Republic. CZECH REP 2.8
The company is managed by a joint venture between
the state telephone companies of Switzerland and
the Netherlands.
Source: Bloomberg
(8) There is no assurance the Fund will continue to hold these or any other
securities mentioned in this report.
27
<PAGE>
CHANCELLOR LGT ASSET MANAGEMENT'S
WORLDWIDE INVESTMENT OFFICES
[MAP]
Chancellor LGT Asset Management is a member of the $80 billion Liechtenstein
Global Trust, and maintains fully staffed investment offices in London,
Frankfurt, Hong Kong, Tokyo, Singapore, Sydney, Toronto, New York and San
Francisco.
28
<PAGE>
GT GLOBAL
THEME FUNDS
FINANCIAL
STATEMENTS
<PAGE>
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Consumer Non-Durables (41.3%)
Morningstar Group, Inc.-/- ................................ US 253,200 $ 6,140,100 4.1
FOOD
Procter & Gamble Co. ...................................... US 45,000 5,658,750 3.7
HOUSEHOLD PRODUCTS
Gillette Co. .............................................. US 62,000 5,270,000 3.5
PERSONAL CARE/COSMETICS
Clorox Co.-/- ............................................. US 41,000 5,222,374 3.4
HOUSEHOLD PRODUCTS
Colgate-Palmolive Co.-/- .................................. US 46,000 5,106,000 3.4
HOUSEHOLD PRODUCTS
Tabacalera S.A. "A" ....................................... SPN 100,000 5,022,581 3.3
TOBACCO
Riser Foods, Inc. "A" ..................................... US 142,000 4,916,750 3.2
FOOD
Interstate Bakeries Corp. ................................. US 94,300 4,891,813 3.2
FOOD
NBTY, Inc.-/- ............................................. US 250,000 4,750,000 3.1
PERSONAL CARE/COSMETICS
Gucci Group - NY Registered Shares{\/} .................... NETH 65,000 4,509,375 3.0
TEXTILES & APPAREL
Philip Morris Cos., Inc. .................................. US 100,000 3,937,500 2.6
FOOD
Raisio Yhtyma Oyj ......................................... FIN 41,300 3,425,111 2.3
FOOD
Quaker Oats Company ....................................... US 78,200 3,128,000 2.1
FOOD
Noble China-/- {/\} ....................................... CHNA 332,200 665,970 0.4
BEVERAGES - ALCOHOLIC
------------
62,644,324
------------
Services (21.4%)
Telecom Italia Mobile S.p.A. .............................. ITLY 1,690,000 5,299,194 3.5
WIRELESS COMMUNICATIONS
Jones Apparel Group, Inc.-/- .............................. US 104,200 4,350,350 2.9
RETAILERS-APPAREL
Avis Europe PLC-/- ........................................ UK 1,952,000 4,268,913 2.8
TRANSPORTATION - ROAD & RAIL
New York Times Co. "A" .................................... US 92,800 4,013,600 2.6
BROADCASTING & PUBLISHING
Tuesday Morning Corp.-/- .................................. US 127,300 3,596,225 2.4
RETAILERS-OTHER
Flanders Corp.-/- ......................................... US 448,900 3,254,525 2.1
CONSUMER SERVICES
Ames Department Stores, Inc.-/- ........................... US 300,800 2,105,600 1.4
RETAILERS-OTHER
Yogen Fruz World-Wide, Inc.-/- ............................ CAN 583,900 2,048,479 1.4
RETAILERS-FOOD
Sears Canada, Inc. ........................................ CAN 170,500 1,824,998 1.2
RETAILERS-OTHER
</TABLE>
The accompanying notes are an integral part of the financial statements.
F1
<PAGE>
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (Continued)
Paul Harris Stores, Inc.-/- ............................... US 130,700 $ 1,682,763 1.1
RETAILERS-APPAREL
------------
32,444,647
------------
Consumer Durables (8.1%)
Ethan Allen Interiors, Inc. ............................... US 99,000 4,380,750 2.9
HOUSING
American Standard Cos., Inc.-/- ........................... US 100,000 4,187,500 2.8
APPLIANCES & HOUSEHOLD
Canadian Tire Corp. "A" ................................... CAN 200,000 3,629,985 2.4
AUTO PARTS
------------
12,198,235
------------
Finance (7.5%)
BankAmerica Corp. ......................................... US 27,000 3,155,625 2.1
BANKS-SUPER REGIONAL
Citicorp .................................................. US 28,000 3,153,500 2.1
BANKS-MONEY CENTER
National Auto Finance Company, Inc.-/- .................... US 400,000 2,600,000 1.7
CONSUMER FINANCE
Intrawest Corp.: .......................................... CAN -- -- 0.9
REAL ESTATE
Common-/- {\/} .......................................... -- 77,700 1,068,375 --
Common-/- ............................................... -- 16,500 230,364 --
Alliance Capital Management L.P. .......................... US 41,100 1,114,838 0.7
INVESTMENT MANAGEMENT
------------
11,322,702
------------
Multi-Industry/Miscellaneous (2.6%)
ITT Corp. (ITT Destinations, Inc.)-/- ..................... US 66,300 3,928,275 2.6
------------
CONGLOMERATE
Technology (2.1%)
Lucent Technologies, Inc. ................................. US 53,600 3,169,100 2.1
------------
NETWORKING
Health Care (2.1%)
Warner-Lambert Co.-/- ..................................... US 32,000 3,136,000 2.1
PHARMACEUTICALS
------------ -----
TOTAL EQUITY INVESTMENTS (cost $127,377,993) ................ 128,843,283 85.1
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F2
<PAGE>
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENTS (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust Co.,
due May 1, 1997, for an effective yield of 5.27%,
collateralized by $19,075,000 Federal Home Loan Mortgage
Corp. Notes, 6.44% due 11/5/99 (market value of collateral
is $19,560,963 including accrued interest). ............. $ 19,175,807 12.7
Dated April 30, 1997, with Bank of America NT&SA, due May
1, 1997, for an effective yield of 5.3%, collateralized by
$15,000,000 U.S. Treasury Notes, 5.625% due 10/31/97
(market value of collateral is $14,996,443 including
interest). .............................................. 14,702,164 9.7
Dated April 30, 1997, with Bank of America NT&SA, due May
1, 1997, for an effective yield of 5.3% collateralized by
$5,540,000 U.S. Treasury Notes, 6.5% due 10/15/06 (market
value of collateral is $5,441,480, including interest).
......................................................... 5,300,780 3.5
------------ -----
TOTAL REPURCHASE AGREEMENTS (cost $39,178,751) .............. 39,178,751 25.9
------------ -----
TOTAL INVESTMENTS (cost $166,556,744) * .................... 168,022,034 111.0
Other Assets and Liabilities ................................ (16,648,389) (11.0)
------------ -----
NET ASSETS .................................................. $151,373,645 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{/\} CAD currency denominated.
{\/} U.S. currency denominated.
* For Federal income tax purposes, cost is $166,673,233 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 6,816,572
Unrealized depreciation: (5,467,771)
-------------
Net unrealized appreciation: $ 1,348,801
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Canada (CAN/CAD) ..................... 5.9 5.9
China (CHNA/RMB) ..................... 0.4 0.4
Finland (FIN/FIM) .................... 2.3 2.3
Italy (ITLY/ITL) ..................... 3.5 3.5
Netherlands (NETH/NLG) ............... 3.0 3.0
Spain (SPN/ESP) ...................... 3.3 3.3
United Kingdom (UK/GBP) .............. 2.8 2.8
United States & Other (US/USD) ....... 63.9 14.9 78.8
------ ----- -----
Total ............................... 85.1 14.9 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $151,373,645.
The accompanying notes are an integral part of the financial statements.
F3
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Banks-Regional (48.0%)
BankAmerica Corp. ......................................... US 18,700 $ 2,185,558 4.7
Green Point Financial Corp. ............................... US 15,100 836,163 1.8
First Union Corp. (N.C.) .................................. US 9,100 764,400 1.7
Bank Hapoalim Ltd.-/- ..................................... ISRL 258,000 550,707 1.2
Nations Bank Corp. ........................................ US 9,000 543,375 1.2
Australia & New Zealand Banking Group Ltd. ................ AUSL 85,000 542,722 1.2
Westpac Banking Corp., Ltd. ............................... AUSL 100,000 538,707 1.2
Hamilton Bancorp, Inc.-/- ................................. US 27,000 519,750 1.1
Sparbanken Sverige AB "A" ................................. SWDN 29,000 517,692 1.1
Union Planters Corp. ...................................... US 11,000 490,875 1.1
Mellon Bank Corp. ......................................... US 5,900 490,438 1.1
Royal Bank of Canada ...................................... CAN 12,000 479,845 1.1
Jyske Bank ................................................ DEN 6,000 475,287 1.0
Norbanken AB-/- ........................................... SWDN 15,400 473,242 1.0
Banco Totta & Acores S.A. "B" ............................. PORT 33,300 465,640 1.0
National Australia Bank Ltd. .............................. AUSL 34,000 465,191 1.0
Zagrebacka Banka - 144A GDR{.} -/- {\/} ................... CRT 13,000 459,875 1.0
Allied Irish Bank PLC{V} .................................. IRE 63,394 451,466 1.0
Anglo-Irish Bank Corp., PLC: .............................. IRE -- -- 1.0
Common{V} ............................................... -- 309,000 385,437 --
Common .................................................. -- 50,000 62,247 --
City National Corp. ....................................... US 19,550 447,206 1.0
Unidanmark AS "A" ......................................... DEN 9,000 445,240 1.0
Lloyds TSB Group PLC ...................................... UK 48,600 444,037 1.0
Bank of Boston Corp. ...................................... US 6,025 438,319 1.0
First National Bank Holdings Ltd.-/- ...................... SAFR 60,800 436,337 1.0
Bank of Montreal .......................................... CAN 11,800 428,338 0.9
Nedcor Ltd. ............................................... SAFR 21,000 427,559 0.9
Den Danske Bank ........................................... DEN 4,940 427,303 0.9
First American Corp. ...................................... US 6,500 425,750 0.9
Bank Leumi Le - Israel-/- ................................. ISRL 245,700 423,013 0.9
National Bank of Canada ................................... CAN 35,600 414,191 0.9
Mercantile Bancorporation, Inc. ........................... US 7,140 414,120 0.9
Banco Bradesco S.A. Preferred-/- .......................... BRZL 48,500,000 401,354 0.9
Banco BHIF - ADR{\/}-/- ................................... CHLE 20,300 400,925 0.9
BG Bank AS ................................................ DEN 9,000 394,707 0.9
Amalgamated Banks of South Africa-/- ...................... SAFR 58,000 382,317 0.8
Banco Commercial S.A. - 144A GDR{.} -/- {\/} .............. URGY 14,000 378,000 0.8
Akbank T.A.S. ............................................. TRKY 5,821,967 373,781 0.8
The Bank of Asia Public Co., Ltd. ......................... THAI 405,000 368,252 0.8
Sovereign Bancorp, Inc. ................................... US 29,200 357,700 0.8
Christiania Bank Og Kreditkasse-/- ........................ NOR 112,900 352,267 0.8
First Chicago NBD Corp. ................................... US 6,175 347,344 0.8
First Bangkok City Bank Public Co., Ltd. .................. THAI 408,600 340,239 0.7
Cullen/Frost Bankers, Inc. ................................ US 9,500 332,500 0.7
PT Bank Internasional Indonesia - Foreign ................. INDO 301,116 216,942 0.5
Commercial Bank of Korea .................................. KOR 39,900 187,396 0.4
Security Bank Corp.-/- .................................... PHIL 98,442 175,589 0.4
</TABLE>
The accompanying notes are an integral part of the financial statements.
F4
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Banks-Regional (Continued)
Grupo Financiero Banorte "B"-/- ........................... MEX 95,000 $ 92,858 0.2
------------
21,972,201
------------
Banks-Money Center (13.9%)
Chase Manhattan Corp. ..................................... US 19,750 1,829,344 4.0
Citicorp .................................................. US 11,050 1,244,506 2.7
HSBC Holdings PLC ......................................... HK 36,200 915,982 2.0
Bank of Tokyo - Mitsubishi ................................ JPN 29,750 471,217 1.0
ABN AMRO Holdings N.V. .................................... NETH 6,290 432,490 1.0
National Westminster Bank PLC ............................. UK 35,700 422,177 0.9
Sumitomo Bank ............................................. JPN 27,000 308,511 0.7
Fuji Bank Ltd. ............................................ JPN 24,000 270,449 0.6
Dai-Ichi Kangyo Bank Ltd. ................................. JPN 15,000 164,303 0.4
Sanwa Bank ................................................ JPN 14,000 150,039 0.3
Industrial Bank of Japan .................................. JPN 13,000 138,298 0.3
------------
6,347,316
------------
Insurance - Multi-Line (5.6%)
American International Group, Inc. ........................ US 4,800 616,800 1.4
Allstate Corp. ............................................ US 8,000 524,000 1.1
Progressive Corp. ......................................... US 6,425 489,103 1.1
Axa Group ................................................. FR 7,770 478,062 1.0
Travelers Property Casualty Corp. "A" ..................... US 13,300 448,875 1.0
------------
2,556,840
------------
Other Financial (5.2%)
Investors Financial Services Corp. ........................ US 13,500 472,500 1.0
Newcourt Credit Group, Inc. ............................... CAN 24,200 447,025 1.0
Aeon Credit Service ....................................... HK 1,254,000 404,725 0.9
Banco LatinoAmericano de Exportaciones S.A. (Bladex)
"E"{\/} .................................................. PAN 8,100 371,588 0.8
Shohkoh Fund .............................................. JPN 1,200 281,797 0.6
House of Investments, Inc.-/- ............................. PHIL 1,989,000 215,129 0.5
Acom Co., Ltd. ............................................ JPN 4,000 163,278 0.4
------------
2,356,042
------------
Insurance-Life (4.1%)
Conseco, Inc. ............................................. US 34,600 1,431,575 3.1
SunAmerica, Inc. .......................................... US 10,200 469,200 1.0
------------
1,900,775
------------
Consumer Finance (3.5%)
Dean Witter, Discover & Co. ............................... US 12,200 466,650 1.0
First Financial Caribbean Corp. ........................... US 16,600 452,350 1.0
Green Tree Financial Corp. ................................ US 13,600 402,900 0.9
Putra Surya Multidana-/- .................................. INDO 230,000 260,395 0.6
------------
1,582,295
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F5
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Securities Broker (1.9%)
Peregrine Investment Holdings Ltd. ........................ HK 232,000 $ 356,416 0.8
Hambrecht & Quist Group-/- ................................ US 20,000 332,500 0.7
Nomura Securities Co., Ltd. ............................... JPN 10,000 111,899 0.2
Daiwa Securities Co., Ltd. ................................ JPN 14,000 93,223 0.2
------------
894,038
------------
Investment Management (1.6%)
Alliance Capital Management L.P. .......................... US 17,400 471,975 1.0
Franklin Resources, Inc. .................................. US 4,750 280,844 0.6
------------
752,819
------------
Real Estate (0.9%)
Alexander Haagen Properties, Inc. ......................... US 31,500 425,250 0.9
------------
Computers & Peripherals (0.8%)
Diebold, Inc. ............................................. US 11,250 376,875 0.8
------------ -----
TOTAL EQUITY INVESTMENTS (cost $36,924,371) ................. 39,164,451 85.5
------------ -----
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Peregrine Investment Holdings Ltd. Warrants, expire 5/15/98
(cost $0)-/- ............................................. HK 24,500 3,669 --
------------ -----
SECURITIES BROKER
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust Co.,
due May 1, 1997, for an effective yield of 5.27%,
collateralized by $5,105,000 U.S. Treasury Bonds, 7.25%
due 5/15/16 (market value of collateral is $5,348,331,
including accrued interest). (cost $5,242,767) .......... 5,242,767 11.5
------------ -----
TOTAL INVESTMENTS (cost $42,167,138) * ..................... 44,410,887 97.0
Other Assets and Liabilities ................................ 1,372,426 3.0
------------ -----
NET ASSETS .................................................. $ 45,783,313 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{\/} U.S. currency denominated.
-/- Non-income producing security.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
{V} GBP currency denominated.
* For Federal income tax purposes, cost is $42,266,994 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 3,471,162
Unrealized depreciation: (1,327,269)
-------------
Net unrealized appreciation: $ 2,143,893
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depository Receipt
GDR--Global Depository Receipt
The accompanying notes are an integral part of the financial statements.
F6
<PAGE>
GT GLOBAL FINANCIAL SERVICES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Australia (AUSL/AUD) ................. 3.4 3.4
Brazil (BRZL/BRL) .................... 0.9 0.9
Canada (CAN/CAD) ..................... 3.9 3.9
Chile (CHLE/CLP) ..................... 0.9 0.9
Croatia (CRT/HRK) .................... 1.0 1.0
Denmark (DEN/DKK) .................... 3.8 3.8
France (FR/FRF) ...................... 1.0 1.0
Hong Kong (HK/HKD) ................... 3.7 3.7
Indonesia (INDO/IDR) ................. 1.1 1.1
Ireland (IRE/IEP) .................... 2.0 2.0
Israel (ISRL/ILS) .................... 2.1 2.1
Japan (JPN/JPY) ...................... 4.7 4.7
Korea (KOR/KRW) ...................... 0.4 0.4
Mexico (MEX/MXN) ..................... 0.2 0.2
Netherlands (NETH/NLG) ............... 1.0 1.0
Norway (NOR/NOK) ..................... 0.8 0.8
Panama (PAN/PND) ..................... 0.8 0.8
Philippines (PHIL/PHP) ............... 0.9 0.9
Portgual (PORT/PTE) .................. 1.0 1.0
South Africa (SAFR/ZAR) .............. 2.7 2.7
Sweden (SWDN/SEK) .................... 2.1 2.1
Thailand (THAI/THB) .................. 1.5 1.5
Turkey (TRKY/TRL) .................... 0.8 0.8
United Kingdom (UK/GBP) .............. 1.9 1.9
United States & Other (US/USD) ....... 42.1 14.5 56.6
Uruguay (URGY/UYP) ................... 0.8 0.8
------ ----- -----
Total ............................... 85.5 14.5 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $45,783,313.
The accompanying notes are an integral part of the financial statements.
F7
<PAGE>
GT GLOBAL HEALTH CARE FUND
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Medical Technology & Supplies (42.1%)
Advanced Technology Laboratories, Inc.{::} -/- ............ US 917,100 $ 30,378,938 6.0
Visx, Inc.{::} -/- ........................................ US 1,169,500 26,313,750 5.2
Mentor Corp. .............................................. US 955,400 22,093,625 4.4
Circon Corp.{::} -/- ...................................... US 875,400 11,270,775 2.2
Endosonics Corp.{::} -/- .................................. US 1,271,700 11,127,375 2.2
Sunrise Medical, Inc.{::} -/- ............................. US 1,011,700 11,002,238 2.2
TECNOL Medical Products, Inc.-/- .......................... US 598,700 10,552,088 2.1
CONMED Corp.-/- ........................................... US 688,000 10,234,000 2.0
Dexter Corp. .............................................. US 300,000 8,962,500 1.8
Biomet, Inc. .............................................. US 537,200 8,158,725 1.6
NeoPath, Inc.-/- .......................................... US 473,800 7,462,350 1.5
Waters Corp.-/- ........................................... US 208,300 6,170,888 1.2
AVECOR Cardiovascular, Inc.{::} -/- ....................... US 601,900 6,019,000 1.2
Lifecore Biomedical, Inc.-/- .............................. US 411,900 5,148,750 1.0
Kensey Nash Corp.{::} -/- ................................. US 388,500 5,147,625 1.0
Physio-Control International Corp.-/- ..................... US 363,700 4,546,250 0.9
Angeion Corp.-/- .......................................... US 975,000 3,900,000 0.8
ThermoTrex Corp.-/- ....................................... US 163,000 3,035,875 0.6
Vital Signs, Inc. ......................................... US 139,000 2,641,000 0.5
Orthologic Corp.-/- ....................................... US 362,500 2,084,375 0.4
INAMED Corp.{::} -/- ...................................... US 628,900 1,965,313 0.4
Kinetic Concepts, Inc. .................................... US 111,200 1,654,100 0.3
Micro Therapeutics, Inc.{::} -/- .......................... US 290,000 1,595,000 0.3
Cardiovascular Dynamics, Inc.-/- .......................... US 214,700 1,529,738 0.3
Photoelectron Corp.{::} -/- ............................... US 338,300 1,480,063 0.3
Abaxis, Inc.-/- ........................................... US 462,400 1,445,000 0.3
Innerdyne, Inc.-/- ........................................ US 742,000 1,437,625 0.3
Lumisys, Inc.-/- .......................................... US 211,400 1,400,525 0.3
Heartstream, Inc.-/- ...................................... US 147,000 1,231,125 0.2
Neoprobe Corp.-/- ......................................... US 76,700 968,338 0.2
Cardiac Pathways Corp.-/- ................................. US 115,600 751,400 0.1
Utah Medical Products, Inc.-/- ............................ US 59,100 391,538 0.1
FemRx, Inc.-/- ............................................ US 160,600 361,350 0.1
General Surgical Innovations, Inc.-/- ..................... US 61,300 306,500 0.1
ATS Medical, Inc.-/- ...................................... US 31,250 203,125 --
Versa Technologies, Inc. .................................. US 11,200 137,200 --
------------
213,108,067
------------
Biotechnology (30.7%)
Amgen, Inc. ............................................... US 651,300 38,345,281 7.6
Protein Design Labs, Inc.{::} -/- ......................... US 1,186,000 29,798,250 5.9
Biochem Pharma, Inc.-/- {\/} .............................. CAN 1,316,200 23,671,034 4.7
Guilford Pharmaceuticals, Inc.-/- ......................... US 773,900 17,896,438 3.5
Regeneron Pharmaceuticals, Inc.{::} -/- ................... US 1,293,900 8,410,350 1.7
Human Genome Sciences, Inc.-/- ............................ US 238,400 7,479,800 1.5
Cell Therapeutics, Inc.-/- ................................ US 545,000 4,564,375 0.9
</TABLE>
The accompanying notes are an integral part of the financial statements.
F8
<PAGE>
GT GLOBAL HEALTH CARE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Biotechnology (Continued)
Interferon Sciences, Inc.{::} -/- ......................... US 898,125 $ 4,322,227 0.9
Genelabs Technologies, Inc.-/- ............................ US 1,642,800 4,107,000 0.8
Agouron Pharmaceuticals, Inc.-/- .......................... US 63,900 4,089,600 0.8
CytoTherapeutics, Inc.-/- ................................. US 523,900 3,405,350 0.7
Centocor, Inc.-/- ......................................... US 66,700 1,875,938 0.4
Pharmacopeia, Inc.-/- ..................................... US 130,000 1,820,000 0.4
Biogen, Inc.-/- ........................................... US 45,000 1,440,000 0.3
COR Therapeutics, Inc.-/- ................................. US 176,800 1,326,000 0.3
Coulter Pharmaceutical, Inc.-/- ........................... US 150,000 1,275,000 0.3
Targeted Genetics Corp.-/- ................................ US 60,000 165,000 --
Somatix Therapy Corp.-/- .................................. US 100,000 146,875 --
Enzon, Inc. Preferred-/- .................................. US 16,000 104,420 --
T Cell Sciences, Inc.-/- .................................. US 60,000 95,625 --
------------
154,338,563
------------
Pharmaceuticals (21.8%)
Watson Pharmaceuticals, Inc.-/- ........................... US 657,700 23,512,775 4.7
TheraTech, Inc.{::} -/- ................................... US 2,117,200 19,584,100 3.9
Catalytica, Inc.{::} -/- .................................. US 1,612,600 11,288,200 2.2
Depotech Corp.{::} -/- .................................... US 673,100 9,844,088 1.9
Perrigo Co.-/- ............................................ US 635,000 7,461,250 1.5
SEQUUS Pharmaceuticals, Inc.-/- ........................... US 998,800 5,867,950 1.2
Spiros Development Corp.(.) -/- (::) ...................... US 100,000 5,683,655 1.1
Alpharma, Inc. "A" ........................................ US 364,700 5,288,150 1.0
Altana AG ................................................. GER 5,000 3,870,595 0.8
Life Medical Sciences, Inc.{::} -/- ....................... US 768,600 3,074,400 0.6
Alkermes, Inc.-/- ......................................... US 275,600 3,031,600 0.6
Dura Pharmaceuticals, Inc.-/- ............................. US 95,100 2,757,900 0.5
PathoGenesis Corp.-/- ..................................... US 90,500 2,375,625 0.5
DUSA Pharmaceuticals, Inc.-/- ............................. US 418,600 2,354,625 0.5
Therapeutic Discovery Corp. "A"-/- ........................ US 100,000 1,062,500 0.2
Alteon, Inc.-/- ........................................... US 306,200 1,033,425 0.2
Unimed Pharmaceuticals, Inc.-/- ........................... US 147,200 791,200 0.2
Intercardia, Inc.-/- ...................................... US 41,200 762,200 0.1
ImmuLogic Pharmaceutical Corp.-/- ......................... US 189,900 688,388 0.1
NPS Pharmaceuticals, Inc.-/- .............................. US 25,000 212,500 --
------------
110,545,126
------------
Health Care Services (2.4%)
Parkway Holdings Ltd. ..................................... SING 900,000 3,671,691 0.7
Cohr, Inc.-/- ............................................. US 151,300 3,366,425 0.7
Owens & Minor, Incorporated Holding Co. ................... US 187,500 2,437,500 0.5
Grupo Casa Autrey, S.A. de C.V. - ADR{\/} ................. MEX 135,100 2,347,363 0.5
------------
11,822,979
------------ -----
TOTAL EQUITY INVESTMENTS (cost $535,195,506) ................ 489,814,735 97.0
------------ -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F9
<PAGE>
GT GLOBAL HEALTH CARE FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
ALZA Corp. Warrants, expire 12/31/99 (cost $0)-/- ......... US 100,000 $ 15,625 --
------------ -----
PHARMACEUTICALS
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust Co.,
due May 1, 1997, for an effective yield of 5.27%,
collateralized by $3,025,000 U.S. Treasury Bonds, 7.25%
due 5/15/16 (market value of collateral is $3,169,187,
including accrued interest). (cost $3,103,454) .......... 3,103,454 0.6
------------ -----
TOTAL INVESTMENTS (cost $538,298,960) * .................... 492,933,814 97.6
Other Assets and Liabilities ................................ 12,171,945 2.4
------------ -----
NET ASSETS .................................................. $505,105,759 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{\/} U.S. currency denominated.
-/- Non-income producing security.
{::} See Note 6 of Notes to Financial Statements.
(::) Valued in good faith at fair value using procedures approved by the
board of directors (See Note 1 of Notes to Financial Statements).
(.) Restricted securities: At April 30, 1997, the Fund owned the
following restricted security constituting 1.1% of net assets which
may not be publicly sold without registration under the Securities
Act of 1933 (Note 1). Additional information on the security is as
follows:
<TABLE>
<CAPTION>
VALUE
ACQUISITION ACQUISITION PER SHARE
DESCRIPTION DATE SHARES COST (NOTE 1)
---------------------------------------- ----------- ------- ----------- ---------
<S> <C> <C> <C> <C>
Spiros Development Corp................. 01/03/96 100,000 $ 3,000,000 $56.84
</TABLE>
* For Federal income tax purposes, cost is $539,447,475 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 19,082,376
Unrealized depreciation: (65,596,037)
-------------
Net unrealized depreciation: $ (46,513,661)
-------------
-------------
</TABLE>
Abbreviation:
ADR--American Depository Receipt
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Canada (CAN/CAD) ..................... 4.7 4.7
Germany (GER/DEM) .................... 0.8 0.8
Mexico (MEX/MXN) ..................... 0.5 0.5
Singapore (SING/SGD) ................. 0.7 0.7
United States & Other (US/USD) ....... 90.3 3.0 93.3
------ ----- -----
Total ............................... 97.0 3.0 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $505,105,759.
The accompanying notes are an integral part of the financial statements.
F10
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Services (26.1%)
Mannesmann AG ............................................. GER 7,500 $ 2,950,607 2.8
WIRELESS COMMUNICATIONS
Tranz Rail Holdings Ltd. - ADR{\/} ........................ NZ 152,200 2,701,550 2.6
TRANSPORTATION - ROAD & RAIL
Telefonica de Espana - ADR{\/} ............................ SPN 34,000 2,618,000 2.5
TELEPHONE NETWORKS
Hellenic Telecommunications - 144A{.} ..................... GREC 110,000 2,497,909 2.4
TELEPHONE NETWORKS
Canadian National Railway Co.{\/} ......................... CAN 60,900 2,344,650 2.2
TRANSPORTATION - ROAD & RAIL
SPT Telecom-/- ............................................ CZCH 19,000 2,008,405 1.9
TELEPHONE NETWORKS
ABC Rail Products Corp.-/- ................................ US 115,100 1,999,863 1.9
TRANSPORTATION - ROAD & RAIL
DDI Corp. ................................................. JPN 295 1,959,693 1.9
WIRELESS COMMUNICATIONS
Philippine Long Distance Telephone Co. - ADR{\/} .......... PHIL 30,000 1,672,500 1.6
TELEPHONE NETWORKS
Portugal Telecom S.A. - ADR{\/} ........................... PORT 43,000 1,591,000 1.5
TELEPHONE NETWORKS
PT Indonesia Satellite (Indosat) - ADR{\/} ................ INDO 40,000 1,100,000 1.1
TELEPHONE - LONG DISTANCE
CPT Telefonica Del Peru, S.A. - ADR-/- {\/} ............... PERU 40,900 981,600 0.9
TELEPHONE NETWORKS
Asia Pacific Wire & Cable Corporation Ltd.-/- ............. US 59,400 705,375 0.7
CABLE TELEVISION
Videsh Sanchar Nigam Ltd. - GDR 144A{.} -/- {\/} .......... IND 28,700 566,682 0.5
TELEPHONE - LONG DISTANCE
Compania Anonima Nacional Telefonos de Venezuela (CANTV) -
ADR-/- {\/} .............................................. VENZ 16,000 480,000 0.5
TELEPHONE NETWORKS
Pakistan Telecommunications Co., Ltd.: .................... PAK -- -- 0.5
TELEPHONE NETWORKS
GDR-/- {\/} ............................................. -- 4,892 298,412 --
"A"-/- .................................................. -- 280,000 172,737 --
Centennial Cellular Corp. "A"-/- .......................... US 50,000 468,750 0.4
WIRELESS COMMUNICATIONS
SK Telecom Co., Ltd. ...................................... KOR 298 233,351 0.2
WIRELESS COMMUNICATIONS
------------
27,351,084
------------
Energy (25.6%)
Light - Participacoes S.A. ................................ BRZL 9,910,000 3,159,196 3.0
ELECTRICAL & GAS UTILITIES
Light - Servicos de Electricidade S.A. .................... BRZL 7,000,000 2,909,535 2.8
ELECTRICAL & GAS UTILITIES
Empresa Nacional de Electridad S.A. - ADR{\/} ............. SPN 40,000 2,795,000 2.7
ELECTRICAL & GAS UTILITIES
Enron Global Power & Pipelines L.L.C. ..................... US 90,000 2,655,000 2.5
ELECTRICAL & GAS UTILITIES
Edison S.p.A. ............................................. ITLY 450,000 2,383,064 2.3
ELECTRICAL & GAS UTILITIES
</TABLE>
The accompanying notes are an integral part of the financial statements.
F11
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy (Continued)
Hub Power Co.-/- .......................................... PAK 2,400,000 $ 2,247,772 2.2
ELECTRICAL & GAS UTILITIES
Korea Electric Power Corp. ................................ KOR 75,000 2,241,573 2.1
ELECTRICAL & GAS UTILITIES
EVN Energie-Versorgung Niederoesterreich AG ............... ASTRI 16,800 2,077,768 2.0
ELECTRICAL & GAS UTILITIES
BSES Ltd. 144A - GDR{.} {\/} .............................. IND 70,000 1,627,500 1.6
ELECTRICAL & GAS UTILITIES
Capex S.A. ................................................ ARG 118,800 1,176,238 1.1
ELECTRICAL & GAS UTILITIES
AES China Generating Co., Ltd. "A"-/- {\/} ................ CHNA 60,800 1,124,800 1.1
ELECTRICAL & GAS UTILITIES
Companhia Energetica de Minas Gerais (Cemig) - ADR{\/} .... BRZL 24,900 1,120,500 1.1
ELECTRICAL & GAS UTILITIES
MetroGas S.A. - ADR{\/} ................................... ARG 111,050 1,110,500 1.1
ELECTRICAL & GAS UTILITIES
------------
26,628,446
------------
Materials/Basic Industry (16.5%)
La Cementos Nacional, C.A. 144A - GDR{.} -/- {\/} ......... ECDR 15,060 3,087,300 3.0
CEMENT
Giant Cement Holding, Inc.-/- ............................. US 179,800 2,876,800 2.8
CEMENT
RMI Titanium Co.-/- ....................................... US 106,600 2,278,575 2.2
METALS - NON-FERROUS
PT Bakrie and Brothers .................................... INDO 4,680,000 2,071,223 2.0
BUILDING MATERIALS & COMPONENTS
Northwest Pipe Co.-/- ..................................... US 127,500 2,040,000 2.0
METALS - STEEL
Hylsamex, S.A. de C.V. 144A - ADR{.} {\/} ................. MEX 75,000 1,968,750 1.9
METALS - STEEL
Shaw Group, Inc.-/- ....................................... US 140,300 1,894,050 1.8
METALS - STEEL
Siam Cement Co., Ltd. - Foreign ........................... THAI 28,000 750,383 0.7
CEMENT
HI Cement Corp. ........................................... PHIL 439,000 146,611 0.1
CEMENT
------------
17,113,692
------------
Capital Goods (13.1%)
Doncasters PLC - ADR-/- {\/} .............................. UK 139,600 3,141,000 3.0
AEROSPACE/DEFENSE
Caterpillar, Inc. ......................................... US 30,000 2,670,000 2.6
MACHINERY & ENGINEERING
Tadiran Telecommunications Ltd.{\/} -/- ................... ISRL 130,000 2,535,000 2.4
TELECOM EQUIPMENT
United Engineers Ltd. ..................................... MAL 270,000 1,914,741 1.8
CONSTRUCTION
KCI Konecranes International .............................. FIN 42,660 1,608,882 1.5
MACHINERY & ENGINEERING
</TABLE>
The accompanying notes are an integral part of the financial statements.
F12
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Capital Goods (Continued)
Emcore Corp.-/- ........................................... US 123,000 $ 1,399,125 1.3
ELECTRICAL PLANT/EQUIPMENT
U.S. Robotics Corp.-/- .................................... US 9,600 486,000 0.5
TELECOM EQUIPMENT
------------
13,754,748
------------
Multi-Industry/Miscellaneous (4.2%)
IES Industries, Inc. ...................................... US 81,000 2,349,000 2.3
MULTI-INDUSTRY
E.R.G. Ltd. ............................................... AUSL 1,503,378 1,969,030 1.9
MULTI-INDUSTRY
------------
4,318,030
------------
Technology (2.1%)
Ciena Corp.-/- ............................................ US 67,600 2,112,500 2.0
TELECOM TECHNOLOGY
DSP Communications, Inc.-/- ............................... US 18,300 145,256 0.1
TELECOM TECHNOLOGY
------------
2,257,756
------------
Consumer Durables (1.1%)
Suez Cement Co. - Reg S GDR-/- {c} {\/} ................... EGPT 60,000 1,116,000 1.1
CEMENT
------------ -----
TOTAL EQUITY INVESTMENTS (cost $80,575,519) ................. 92,539,756 88.7
------------ -----
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust Co.,
due May 1, 1997, for an effective yield of 5.27%,
collateralized by $10,560,000 U.S. Treasury Bonds, 7.25%
due 5/15/16 (market value of collateral is $11,063,344,
including accrued interest). (cost $10,844,587) ......... 10,844,587 10.4
------------ -----
TOTAL INVESTMENTS (cost $91,420,106) * ..................... 103,384,343 99.1
Other Assets and Liabilities ................................ 939,573 0.9
------------ -----
NET ASSETS .................................................. $104,323,916 100.0
------------ -----
------------ -----
</TABLE>
- --------------
{\/} U.S. currency denominated.
-/- Non-income producing security.
{c} Security issued under Regulation S. Rule 144A and additional
restrictions may apply in the resale of such securities.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
* For Federal income tax purposes, cost is $91,420,106 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 17,657,833
Unrealized depreciation: (5,693,596)
-------------
Net unrealized appreciation: $ 11,964,237
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depository Receipt
GDR--Global Depository Receipt
The accompanying notes are an integral part of the financial statements.
F13
<PAGE>
GT GLOBAL INFRASTRUCTURE FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
{D}
---------------------------
SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY & OTHER TOTAL
- -------------------------------------- ------ ---------- -----
<S> <C> <C> <C>
Argentina (ARG/ARS) .................. 2.2 2.2
Australia (AUSL/AUD) ................. 1.9 1.9
Austria (ASTRI/ATS) .................. 2.0 2.0
Brazil (BRZL/BRL) .................... 6.9 6.9
Canada (CAN/CAD) ..................... 2.2 2.2
China (CHNA/RMB) ..................... 1.1 1.1
Czech Republic (CZCH/CSK) ............ 1.9 1.9
Ecuador (ECDR/ECS) ................... 3.0 3.0
Egypt (EGPT/EGP) ..................... 1.1 1.1
Finland (FIN/FIM) .................... 1.5 1.5
Germany (GER/DEM) .................... 2.8 2.8
Greece (GREC/GRD) .................... 2.4 2.4
India (IND/INR) ...................... 2.1 2.1
Indonesia (INDO/IDR) ................. 3.1 3.1
Israel (ISRL/ILS) .................... 2.4 2.4
Italy (ITLY/ITL) ..................... 2.3 2.3
Japan (JPN/JPY) ...................... 1.9 1.9
Korea (KOR/KRW) ...................... 2.3 2.3
Malaysia (MAL/MYR) ................... 1.8 1.8
Mexico (MEX/MXN) ..................... 1.9 1.9
New Zealand (NZ/NZD) ................. 2.6 2.6
Pakistan (PAK/PKR) ................... 2.7 2.7
Peru (PERU/PES) ...................... 0.9 0.9
Philippines (PHIL/PHP) ............... 1.7 1.7
Portugal (PORT/PTE) .................. 1.5 1.5
Spain (SPN/ESP) ...................... 5.2 5.2
Thailand (THAI/THB) .................. 0.7 0.7
United Kingdom (UK/GBP) .............. 3.0 3.0
United States & Other (US/USD) ....... 23.1 11.3 34.4
Venezuela (VENZ/VEB) ................. 0.5 0.5
------ ----- -----
Total ............................... 88.7 11.3 100.0
------ ----- -----
------ ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $104,323,916.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
APRIL 30, 1997
<TABLE>
<CAPTION>
MARKET VALUE CONTRACT DELIVERY UNREALIZED
CONTRACTS TO SELL: (U.S. DOLLARS) PRICE DATE APPRECIATION
- ---------------------------------------- -------------- --------- -------- ------------
Deutsche Marks.......................... 1,505,248 1.67435 05/30/97 $47,594
<S> <C> <C> <C> <C>
Japanese Yen............................ 569,176 121.00000 07/07/97 21,733
Japanese Yen............................ 155,634 119.69000 05/06/97 9,375
-------------- ------------
Total Contracts to Sell (Receivable
amount $2,308,760)................... 2,230,058 78,702
-------------- ------------
THE VALUE OF CONTRACTS TO SELL AS
PERCENTAGE OF NET ASSETS IS 2.14%.
Total Open Forward Foreign Currency
Contracts............................ $78,702
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F14
<PAGE>
GT GLOBAL NATURAL RESOURCES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Energy Equipment & Services (20.1%)
Cooper Cameron Corp.-/- ................................... US 57,100 $ 4,068,375 3.7
Energy Ventures, Inc.-/- .................................. US 47,000 3,137,250 2.8
Global Industries Ltd.-/- ................................. US 138,400 2,906,400 2.6
BJ Services Co.-/- ........................................ US 60,900 2,869,913 2.6
Marine Drilling Co., Inc.-/- .............................. US 161,200 2,538,900 2.3
Halliburton Co. ........................................... US 32,400 2,288,250 2.1
Sutton Resources Ltd.-/- .................................. CAN 186,400 1,668,218 1.5
Varco International, Inc.-/- .............................. US 60,000 1,380,000 1.2
Key Energy Group, Inc.-/- ................................. US 85,600 1,155,600 1.0
Seacor Holdings, Inc.-/- .................................. US 7,800 335,400 0.3
------------
22,348,306
------------
Oil (13.6%)
Patterson Energy, Inc.-/- ................................. US 123,900 3,562,125 3.2
Schlumberger Ltd. ......................................... US 30,400 3,366,800 3.0
Triton Energy Ltd.-/- ..................................... US 54,700 2,010,225 1.8
Benton Oil & Gas Co.-/- ................................... US 113,300 1,657,013 1.5
Canadian Occidental Petroleum Ltd. ........................ CAN 81,600 1,609,565 1.5
Edge Petroleum Corp.-/- ................................... US 81,400 1,109,075 1.0
Gulfstream Resources Canada Ltd.-/- ....................... CAN 125,000 1,073,960 1.0
Jerez Energy International, Inc.-/- ....................... CAN 612,000 657,264 0.6
------------
15,046,027
------------
Gold (7.1%)
Freeport-McMoran Copper & Gold, Inc. "A" .................. US 113,100 3,166,800 2.9
Cominco Ltd. .............................................. CAN 89,800 2,314,599 2.1
Oryx Gold Holdings Ltd.-/- ................................ SAFR 756,600 817,026 0.7
Queenstake Resources Ltd.-/- .............................. CAN 538,400 790,234 0.7
Asquith Resources, Inc.{::} -/- ........................... CAN 487,400 383,862 0.3
Arian Resources Corp.-/-{\/} .............................. CAN 200,000 230,000 0.2
DiamondWorks Ltd.-/- ...................................... CAN 125,000 195,998 0.2
------------
7,898,519
------------
Chemicals (6.0%)
Ciba Specialty Chemicals AG-/- ............................ SWTZ 43,360 3,740,470 3.4
Methanex Corp.-/- ......................................... CAN 304,800 2,858,796 2.6
------------
6,599,266
------------
Forest Products (5.7%)
Pacific Forest Products Ltd.-/- ........................... CAN 245,800 4,047,682 3.6
Abitibi-Price, Inc. ....................................... CAN 120,600 2,033,457 1.8
Stone-Consolidated Corp.-/- ............................... CAN 19,400 325,023 0.3
------------
6,406,162
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F15
<PAGE>
GT GLOBAL NATURAL RESOURCES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Metals - Steel (5.0%)
UCAR International, Inc.-/- ............................... US 88,400 $ 3,712,800 3.3
The Carbide/Graphite Group, Inc.-/- ....................... US 85,100 1,936,025 1.7
------------
5,648,825
------------
Misc. Materials & Commodities (5.0%)
Repadre Capital Corp.-/- .................................. CAN 278,000 1,652,037 1.5
International Uranium Corp. (Private Placement)(.)
-/-(::) .................................................. CAN 1,845,000 1,651,214 1.5
Aber Resources Ltd.-/- .................................... CAN 75,000 1,186,726 1.1
Farallon Resources Ltd.-/- ................................ CAN 161,100 1,038,090 0.9
------------
5,528,067
------------
Miscellaneous (4.7%)
Orogen Minerals Ltd.: ..................................... AUSL -- -- 4.7
144A - ADR{.} {\/} ...................................... -- 128,600 2,942,368 --
Common .................................................. -- 1,000,000 2,304,514 --
------------
5,246,882
------------
Metals - Non-Ferrous (3.8%)
Savage Resources Ltd. ..................................... AUSL 3,800,000 3,703,126 3.3
International Curator Resources Ltd.-/- ................... CAN 100,000 551,299 0.5
------------
4,254,425
------------
Gas Production & Distribution (1.8%)
Comstock Resources, Inc.-/- ............................... US 232,100 1,972,850 1.8
------------
Conglomerate (1.0%)
Brascan Ltd. "A" .......................................... CAN 47,500 1,152,896 1.0
------------
Transportation - Shipping (0.9%)
Trico Marine Services, Inc.-/- ............................ US 20,300 720,650 0.7
Hvide Marine, Inc. "A"-/- ................................. US 11,500 198,375 0.2
------------
919,025
------------
Coal (0.7%)
Australian Coal and Gold Holdings Ltd.-/- ................. AUSL 2,220,000 778,826 0.7
------------ -----
TOTAL EQUITY INVESTMENTS (cost $88,975,178) ................. 83,800,076 75.4
------------ -----
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- ------------------------------------------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Yamana Resources, Inc. Warrants, expire 12/31/98 (cost
$65,112)-/- .............................................. CAN 81,200 72,671 0.1
------------ -----
MISC. MATERIALS & COMMODITIES
</TABLE>
The accompanying notes are an integral part of the financial statements.
F16
<PAGE>
GT GLOBAL NATURAL RESOURCES FUND - CONSOLIDATED
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- ------------------------------------------------------------- ------------ -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust Co.,
due May 1, 1997, for an effective yield of 5.27%,
collateralized by $22,720,000 Federal Home Loan Mortgage
Corp. Notes, 5.84% due 4/8/98 (market value of collateral
is $22,745,472, including accrued interest). (cost
$22,296,263) ............................................ $ 22,296,263 20.0
------------ -----
TOTAL INVESTMENTS (cost $111,336,553) * .................... 106,169,010 95.5
Other Assets and Liabilities ................................ 4,996,244 4.5
------------ -----
NET ASSETS .................................................. $111,165,254 100.0
------------ -----
------------ -----
</TABLE>
- --------------
-/- Non-income producing security.
{\/} U.S. currency denominated.
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
{::} See Note 6 of Notes to Financial Statements.
(::) Valued in good faith at fair value using procedures approved by the
board of directors (See Note 1 of Notes to Financial Statements).
(.) Restricted securities: At April 30, 1997, the Fund owned the
following restricted security constituting 1.5% of net assets which
may not be publicly sold without registration under the Securities
Act of 1933 (Note 1). Additional information on the security is as
follows:
<TABLE>
<CAPTION>
VALUE
ACQUISITION ACQUISITION PER SHARE
DESCRIPTION DATE SHARES COST (NOTE 1)
---------------------------------------- ----------- ------- ----------- ---------
<S> <C> <C> <C> <C>
International Uranium Corp. (Private
Placement)............................. 03/21/97 1,845,000 $ 1,671,559 $ 0.89
</TABLE>
* For Federal income tax purposes, cost is $111,966,778 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 3,570,029
Unrealized depreciation: (9,367,797)
-------------
Net unrealized depreciation: $ (5,797,768)
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS {D}
-------------------------------------------
FIXED INCOME,
RIGHTS & SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY WARRANTS & OTHER TOTAL
- -------------------------------------- ------ ------------- ---------- -----
<S> <C> <C> <C> <C>
Australia (AUSL/AUD) ................. 8.7 8.7
Canada (CAN/CAD) ..................... 22.9 0.1 23.0
South Africa (SAFR/ZAR) .............. 0.7 0.7
Switzerland (SWTZ/CHF) ............... 3.4 3.4
United States & Other (US/USD) ....... 39.7 24.5 64.2
------ ----- ----- -----
Total ............................... 75.4 0.1 24.5 100.0
------ ----- ----- -----
------ ----- ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $111,165,254.
The accompanying notes are an integral part of the financial statements.
F17
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Telecom Equipment (29.0%)
L.M. Ericsson Telephone Co.: .......................... SWDN -- -- 5.4
ADR{\/} ............................................. -- 1,827,300 $ 61,442,963 --
"B" Free ............................................ -- 871,200 27,549,582 --
Nokia AB "A" .......................................... FIN 1,274,160 78,822,862 4.8
ECI Telecommunications Ltd.{\/} ....................... ISRL 2,879,500 62,989,063 3.8
Newbridge Networks Corp.-/- ........................... CAN 1,819,800 58,110,604 3.5
DSC Communications Corp.-/- ........................... US 1,220,100 24,859,538 1.5
Tekelec{::} -/- ....................................... US 1,004,000 23,092,000 1.4
Motorola, Inc. ........................................ US 400,000 22,900,000 1.4
Andrew Corp.-/- ....................................... US 834,825 20,661,919 1.2
P-COM, Inc.-/- ........................................ US 600,000 17,175,000 1.0
ANTEC Corp.-/- ........................................ US 1,322,600 11,572,750 0.7
General Instrument Corp.-/- ........................... US 450,000 10,518,750 0.6
Champion Technology Holding Ltd. ...................... HK 65,875,926 9,780,185 0.6
Geotek Communications, Inc.-/- ........................ US 2,471,100 9,266,625 0.6
Tadiran Ltd. - ADR{\/} ................................ ISRL 310,700 8,117,038 0.5
Sapura Telecommunications Bhd. ........................ MAL 4,730,000 7,688,606 0.5
Mitel Corp.-/- {\/} ................................... CAN 1,473,100 7,181,363 0.4
Octel Communications Corp.-/- ......................... US 384,600 6,249,750 0.4
Allen Group, Inc.-/- .................................. US 300,000 5,175,000 0.3
Netas Telekomunik ..................................... TRKY 17,820,000 4,931,370 0.3
Gandalf Technologies, Inc.-/- {\/} .................... CAN 895,000 895,000 0.1
Kantone Holding Ltd.-/- ............................... HK 6,256,868 848,142 --
--------------
479,828,110
--------------
Telephone Networks (24.7%)
Telecomunicacoes Brasileiras S.A. (Telebras) -
ADR{\/} .............................................. BRZL 989,500 113,545,125 6.9
Stet Societa' Finanziaria Telefonica S.p.A. - Di
Risp ................................................. ITLY 14,820,000 54,844,988 3.3
SPT Telecom-/- ........................................ CZCH 445,090 47,048,466 2.8
WorldCom, Inc. ........................................ US 1,644,290 39,462,960 2.4
Telecom Italia S.p.A.: ................................ ITLY -- -- 2.0
Di Risp ............................................. -- 12,172,000 26,335,123 --
Common .............................................. -- 2,274,001 6,017,892 --
Cable & Wireless PLC - ADR-/- {\/} .................... UK 1,001,989 23,170,996 1.4
Hellenic Telecommunications - 144A{.} ................. GREC 880,000 19,983,273 1.2
NTL, Inc.-/-{\/} ...................................... UK 855,833 16,688,744 1.0
Cable & Wireless Communications - ADR-/- {\/} ......... UK 668,424 16,042,182 1.0
TelecomAsia Corp. - Foreign-/- ........................ THAI 6,622,652 10,078,500 0.6
Russian Telecommunications Development Corp.: ......... RUS -- -- 0.5
Non-Voting(.) -/- {\/} (::) ......................... -- 453,000 4,530,000 --
Voting(.) -/- {\/} (::) ............................. -- 331,000 3,310,000 --
Pakistan Telecommunications Co., Ltd. - GDR-/- {\/} ... PAK 126,937 7,743,157 0.5
CPT Telefonica De Peru - ADR{\/} ...................... PERU 318,400 7,641,600 0.5
Atlantic Tele-Network, Inc.-/- ........................ US 600,100 6,301,050 0.4
PLD Telekon, Inc.-/- {\/} ............................. RUS 510,000 2,709,375 0.2
--------------
405,453,431
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F18
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Wireless Communications (18.0%)
DDI Corp. ............................................. JPN 9,320 $ 61,913,002 3.7
Mannesmann AG ......................................... GER 140,900 55,432,062 3.4
Millicom International Cellular S.A.{::} -/- {\/} ..... LUX 1,057,000 48,093,500 2.9
Korea Mobile Telecommunications: ...................... KOR -- -- 1.6
Common .............................................. -- 20,167 15,791,894 --
ADR{\/} -/- ......................................... -- 1,019,700 9,687,150 --
Nextel Communications, Inc. "A"-/- .................... US 1,585,700 20,911,419 1.3
Grupo Iusacell S.A. - "L" ADR-/- {\/} ................. MEX 1,672,100 19,020,138 1.1
Telecom Italia Mobile S.p.A. - Di Risp ................ ITLY 7,630,000 14,084,920 0.8
Advanced Info. Service - Foreign ...................... THAI 1,993,150 13,277,492 0.8
WinStar Communications, Inc.-/- ....................... US 667,700 6,927,388 0.4
Shinawatra Computer Co., Ltd. - Foreign ............... THAI 848,700 6,498,469 0.4
United Communication Industry - Foreign ............... THAI 967,800 6,039,487 0.4
International Engineering PLC - Foreign{::} -/- ....... THAI 2,948,500 5,757,025 0.3
Western Wireless Corp. "A"-/- ......................... US 479,000 4,909,750 0.3
Clearnet Communications, Inc. "A"-/- {\/} ............. CAN 600,000 4,425,000 0.3
Intercel, Inc.-/- ..................................... US 365,000 3,558,750 0.2
Aerial Communications, Inc.-/- ........................ US 230,000 1,121,250 0.1
--------------
297,448,696
--------------
Instrumentation & Test (2.8%)
Uniphase Corp.-/- ..................................... US 600,000 23,850,000 1.4
Murata Manufacturing Co., Ltd. ........................ JPN 631,000 23,270,922 1.4
--------------
47,120,922
--------------
Broadcasting & Publishing (2.7%)
Granada Group PLC ..................................... UK 1,100,000 15,859,388 1.0
Sistem Televisyen Malaysia Bhd. ....................... MAL 7,436,000 15,405,259 0.9
EchoStar Communications Corp. "A"{::} -/- ............. US 609,200 9,214,150 0.6
Seat S.p.A.-/- ........................................ ITLY 16,820,000 3,334,738 0.2
--------------
43,813,535
--------------
Telephone - Regional/Local (2.2%)
ICG Communications, Inc.-/- ........................... US 1,504,600 15,798,300 1.0
Intermedia Communications of Florida, Inc.-/- ......... US 613,900 12,124,525 0.7
Brooks Fiber Properties, Inc.-/- ...................... US 386,300 8,402,025 0.5
--------------
36,324,850
--------------
Semiconductors (2.1%)
LSI Logic Corp.-/- .................................... US 910,200 34,815,150 2.1
--------------
Aerospace/Defense (1.9%)
Orbital Sciences Corp.{::} -/- ........................ US 2,088,500 30,805,375 1.9
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F19
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE % OF NET
EQUITY INVESTMENTS COUNTRY SHARES (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Telephone - Long Distance (1.7%)
Call-Net Enterprises, Inc.: ........................... CAN -- -- 1.7
"B"-/- .............................................. -- 1,036,700 $ 15,141,892 --
"A"-/- .............................................. -- 519,400 7,809,408 --
144A{.} -/- ......................................... -- 379,400 5,541,462 --
--------------
28,492,762
--------------
Multi-Industry (1.5%)
Grupo Carso, S.A. de C.V. "A1" ........................ MEX 4,200,000 24,282,655 1.5
--------------
Consumer Electronics (1.3%)
Amcol Holdings Ltd.(::) ............................... SING 10,644,000 13,836,758 0.8
Three-Five Systems, Inc.{::} -/- ...................... US 599,000 7,712,125 0.5
--------------
21,548,883
--------------
Cable Television (1.3%)
Comcast Corp. "A" ..................................... US 604,300 9,517,725 0.6
Comcast UK Cable Partners Ltd. "A"-/-{\/} ............. UK 415,000 4,720,625 0.3
HSN, Inc.-/- .......................................... US 155,000 3,642,500 0.2
United International Holdings, Inc. "A"-/- ............ US 373,000 3,590,125 0.2
--------------
21,470,975
--------------
Telecom - Other (1.3%)
Carso Global Telecom "A1"-/- .......................... MEX 5,856,683 18,221,447 1.1
Himachal Futuristic Communications Ltd. - 144AGDR{.}
-/- {\/} {::} ........................................ IND 2,248,000 2,810,000 0.2
--------------
21,031,447
--------------
Telecom Technology (0.0%)
DSP Communications, Inc.-/- ........................... US 93,000 738,188 --
--------------
Retailers - Other (0.0%)
Gran Cadena de Almacenes Colombianos S.A. ............. COL 66,560 55,081 --
-------------- -----
TOTAL EQUITY INVESTMENTS (cost $1,337,723,697) .......... 1,493,230,060 90.5
-------------- -----
<CAPTION>
PRINCIPAL VALUE % OF NET
FIXED INCOME INVESTMENTS CURRENCY AMOUNT (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
Structured Notes (2.4%)
Russia (2.4%)
Credit Suisse Financial Products Russian Equity
Linked Note, 0%, due 4/29/98 (This is an equity
linked note. The value of this note is linked to the
underlying value of Rostelecom.)-/- ................ USD 38,000,000 39,645,400 2.4
--------------
Corporate Bonds (0.1%)
Malaysia (0.1%)
Sapura Telecommunications Bhd., Convertible Bond, 2%
due 9/14/00 ........................................ MYR 3,547,500 1,279,079 0.1
-------------- -----
TOTAL FIXED INCOME INVESTMENTS (cost $39,399,408) ....... 40,924,479 2.5
-------------- -----
</TABLE>
The accompanying notes are an integral part of the financial statements.
F20
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NO. OF VALUE % OF NET
WARRANTS COUNTRY WARRANTS (NOTE 1) ASSETS
- --------------------------------------------------------- -------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
American Satellite Network Warrants, expire 1/1/99
(cost $0)(::) -/- .................................... US 65,825 -- --
-------------- -----
WIRELESS COMMUNICATIONS
<CAPTION>
VALUE % OF NET
REPURCHASE AGREEMENT (NOTE 1) ASSETS
- --------------------------------------------------------- -------------- -------------
<S> <C> <C> <C> <C>
Dated April 30, 1997, with State Street Bank & Trust
Co., due May 1, 1997, for an effective yield of 5.3%,
collateralized by $74,175,000 Federal Farm Credit Bank
Notes, effective yield 6.4% due 11/05/99 (market value
of collateral is $76,064,715, including accrued
interest). (cost $74,570,915) ....................... $ 74,570,915 4.5
-------------- -----
TOTAL INVESTMENTS (cost $1,451,694,020) * .............. 1,608,725,454 97.5
Other Assets and Liabilities ............................ 41,563,018 2.5
-------------- -----
NET ASSETS .............................................. $1,650,288,472 100.0
-------------- -----
-------------- -----
</TABLE>
- --------------
-/- Non-income producing security.
{::} See Note 6 of Notes to Financial Statements.
{\/} U.S. currency denominated.
(::) Valued in good faith at fair value using procedures approved by the
board of directors (See Note 1 of Notes to Financial Statements).
{.} Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
(.) Restricted securities: At April 30, 1997, the Fund owned the
following restricted security constituting 0.5% of net assets which
may not be publicly sold without registration under the Securities
Act of 1933 (Note 1). Additional information on the security is as
follows:
<TABLE>
<CAPTION>
ACQUISITION ACQUISITION MARKET VALUE
DESCRIPTION DATE SHARES COST PER SHARE
- -------------------------------------------------- ----------- ------- ----------- ------------
<S> <C> <C> <C> <C>
Russian Telecommunications Development
Corporation:
Non-voting...................................... 12/22/93 453,000 $ 4,530,000 $10.00
Voting.......................................... 12/22/93 331,000 3,310,000 10.00
</TABLE>
* For Federal income tax purposes, cost is $1,454,758,747 and
appreciation (depreciation) is as follows:
<TABLE>
<S> <C>
Unrealized appreciation: $ 405,130,381
Unrealized depreciation: (251,163,674)
-------------
Net unrealized appreciation: $ 153,966,707
-------------
-------------
</TABLE>
Abbreviations:
ADR--American Depository Receipt
GDR--Global Depository Receipt
The accompanying notes are an integral part of the financial statements.
F21
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at April 30, 1997, was concentrated in the
following countries:
<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS {D}
-------------------------------------------
FIXED INCOME,
RIGHTS & SHORT-TERM
COUNTRY (COUNTRY CODE/CURRENCY CODE) EQUITY WARRANTS & OTHER TOTAL
- -------------------------------------- ------ ------------- ---------- -----
<S> <C> <C> <C> <C>
Brazil (BRZL/BRL) .................... 6.9 6.9
Canada (CAN/CAD) ..................... 6.0 6.0
Czech Republic (CZCH/CSK) ............ 2.8 2.8
Finland (FIN/FIM) .................... 4.8 4.8
Germany (GER/DEM) .................... 3.4 3.4
Greece (GREC/GRD) .................... 1.2 1.2
Hong Kong (HK/HKD) ................... 0.6 0.6
India (IND/INR) ...................... 0.2 0.2
Israel (ISRL/ILS) .................... 4.3 4.3
Italy (ITLY/ITL) ..................... 6.3 6.3
Japan (JPN/JPY) ...................... 5.1 5.1
Korea (KOR/KRW) ...................... 1.6 1.6
Luxembourg (LUX/LUF) ................. 2.9 2.9
Malaysia (MAL/MYR) ................... 1.4 0.1 1.5
Mexico (MEX/MXN) ..................... 3.7 3.7
Pakistan (PAK/PKR) ................... 0.5 0.5
Peru (PERU/PES) ...................... 0.5 0.5
Russia (RUS/SUR) ..................... 0.7 2.4 3.1
Singapore (SING/SGD) ................. 0.8 0.8
Sweden (SWDN/SEK) .................... 5.4 5.4
Thailand (THAI/THB) .................. 2.5 2.5
Turkey (TRKY/TRL) .................... 0.3 0.3
United Kingdom (UK/GBP) .............. 4.7 4.7
United States & Other (US/USD) ....... 23.9 7.0 30.9
------ ----- ----- -----
Total ............................... 90.5 2.5 7.0 100.0
------ ----- ----- -----
------ ----- ----- -----
</TABLE>
- --------------
{d} Percentages indicated are based on net assets of $1,650,288,472.
The accompanying notes are an integral part of the financial statements.
F22
<PAGE>
GT GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
APRIL 30, 1997
<TABLE>
<CAPTION>
MARKET VALUE UNREALIZED
(U.S. CONTRACT DELIVERY APPRECIATION
CONTRACTS TO BUY: DOLLARS) PRICE DATE (DEPRECIATION)
- ---------------------------------------- ------------ ----------- -------- --------------
<S> <C> <C> <C> <C>
Deutsche Marks.......................... 8,105,182 1.72740 5/30/97 $ 516
Deutsche Marks.......................... 8,105,182 1.73400 5/30/97 31,364
French Francs........................... 6,599,345 5.70150 5/20/97 (153,264)
French Francs........................... 2,691,162 5.61380 5/20/97 (105,518)
French Francs........................... 1,971,233 5.67000 5/20/97 (56,984)
Japanese Yen............................ 10,964,539 125.22000 5/06/97 (147,105)
Japanese Yen............................ 583,136 125.65300 5/12/97 (5,787)
Japanese Yen............................ 1,998,962 124.52000 7/07/97 (17,662)
------------ --------------
Total Contracts to Buy (Payable amount
$41,473,181)......................... 41,018,741 (454,440)
------------ --------------
THE VALUE OF CONTRACTS TO BUY AS
PERCENTAGE OF NET ASSETS IS 2.49%.
<CAPTION>
CONTRACTS TO SELL:
- ----------------------------------------
<S> <C> <C> <C> <C>
British Pounds.......................... 4,035,076 0.61652 7/21/97 19,924
British Pounds.......................... 19,368,365 0.61429 7/21/97 166,435
Deutsche Marks.......................... 31,841,787 1.67700 5/30/97 954,874
Finnish Markka.......................... 4,066,979 5.16370 7/21/97 (128)
Finnish Markka.......................... 35,828,147 5.15700 7/21/97 45,423
French Francs........................... 11,261,740 5.66000 5/20/97 346,034
Italian Liras........................... 4,076,176 1,730.51000 7/21/97 (31,126)
Italian Liras........................... 51,243,356 1,706.98000 7/21/97 309,679
Japanese Yen............................ 10,964,539 119.69000 5/06/97 660,492
Japanese Yen............................ 41,245,075 123.10000 5/12/97 1,273,203
Japanese Yen............................ 1,998,962 121.00000 7/07/97 76,327
Swedish Kronor.......................... 4,043,668 7.75210 7/21/97 32,647
Swedish Kronor.......................... 45,427,283 7.69635 7/21/97 698,478
------------ --------------
Total Contracts to Sell (Receivable
amount $269,953,415)................. 265,401,153 4,552,262
------------ --------------
THE VALUE OF CONTRACTS TO SELL AS
PERCENTAGE OF NET ASSETS IS 16.08%.
Total Open Forward Foreign Currency Contracts, Net......................... $4,097,822
--------------
--------------
</TABLE>
- --------------
See Note 1 to the financial statements.
The accompanying notes are an integral part of the financial statements.
F23
<PAGE>
GT GLOBAL THEME FUNDS
STATEMENT OF ASSETS
AND LIABILITIES
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
-----------------------------------------------------------------------------
CONSUMER NATURAL
PRODUCTS AND FINANCIAL INFRASTRUCTURE RESOURCES
SERVICES FUND- SERVICES FUND- HEALTH FUND- FUND-
CONSOLIDATED CONSOLIDATED CARE CONSOLIDATED CONSOLIDATED
(NOTE 1) (NOTE 1) FUND (NOTE 1) (NOTE 1)
-------------- -------------- ------------ -------------- ------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments in securities: (Note 1)
At identified cost.................. $127,377,993 $36,924,371 $535,195,506 $ 80,575,519 $ 89,040,290
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
At value............................ $128,843,283 $39,168,120 $489,830,360 $ 92,539,756 $ 83,872,747
Repurchase Agreement, at value and
cost (Note 1)...................... 39,178,751 5,242,767 3,103,454 10,844,587 22,296,263
U.S. currency......................... 712 79,513 253 457 560
Foreign currencies (cost $13,513,
$1,166,574, $1,145,431, $223,609,
$6,926,420, and $10,337,086,
respectively)........................ 13,510 1,154,608 1,145,423 212,175 6,874,944
Dividends and dividend withholding tax
reclaims
receivable........................... 275,596 124,629 274,451 99,672 55,980
Interest receivable................... -- -- -- -- --
Receivable for Fund shares sold (Note
2)................................... 259,517 1,596,286 330,065 167,716 296,138
Receivable for open forward foreign
currency contracts, net (Note 1)..... -- -- -- 78,702 --
Receivable for securities sold........ 1,630,219 -- 16,127,059 874,065 4,176,898
Receivable from Chancellor LGT Asset
Management, Inc.
(Note 2)............................. -- 63,328 -- -- --
Unamortized organizational costs (Note
1)................................... 27,457 26,307 -- 21,472 25,425
Miscellaneous receivable.............. 1,260 1,414 11,286 -- 271
Cash held as collateral for securities
loaned (Note 1)...................... 7,089,430 3,660,429 48,736,900 7,673,825 6,945,000
-------------- -------------- ------------ -------------- ------------
Total assets........................ 177,319,735 51,117,401 559,559,251 112,512,427 124,544,226
-------------- -------------- ------------ -------------- ------------
Liabilities:
Payable for custodian fees (Note 1)... 4,676 2,502 9,612 2,618 6,178
Payable for Directors' and Trustees'
fees and expenses
(Note 2)............................. 5,400 3,931 7,101 7,221 4,354
Payable for fund accounting fees (Note
2)................................... 2,879 761 9,432 1,908 2,089
Payable for Fund shares repurchased
(Note 2)............................. 1,382,786 733,159 4,138,511 218,884 445,920
Payable for investment management and
administration fees (Note 2)......... 125,296 142,590 423,239 83,711 92,206
Payable for printing and postage
expenses............................. 30,353 35,295 6,985 49,052 33,516
Payable for professional fees......... 39,434 30,996 44,053 48,119 39,725
Payable for registration and filing
fees................................. 5,385 6,043 21,198 7,617 3,222
Payable for securities purchased...... 17,084,182 669,484 651,308 -- 5,665,666
Payable for service and distribution
expenses (Note 2).................... 101,728 25,835 270,273 68,684 74,075
Payable for transfer agent fees (Note
2)................................... 32,843 13,223 120,458 18,158 59,087
Other accrued expenses................ 41,598 9,740 14,422 8,614 7,834
Collateral for securities loaned (Note
1)................................... 7,089,430 3,660,429 48,736,900 7,673,825 6,945,000
-------------- -------------- ------------ -------------- ------------
Total liabilities................... 25,945,990 5,333,988 54,453,492 8,188,411 13,378,872
Minority interest (Notes 1 & 2)....... 100 100 -- 100 100
-------------- -------------- ------------ -------------- ------------
Net assets.............................. $151,373,645 $45,783,313 $505,105,759 $104,323,916 $111,165,254
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
<CAPTION>
TELECOM-
MUNICATIONS
FUND
--------------
<S> <C>
Assets:
Investments in securities: (Note 1)
At identified cost.................. $1,377,123,105
--------------
--------------
At value............................ $1,534,154,539
Repurchase Agreement, at value and
cost (Note 1)...................... 74,570,915
U.S. currency......................... 561
Foreign currencies (cost $13,513,
$1,166,574, $1,145,431, $223,609,
$6,926,420, and $10,337,086,
respectively)........................ 10,404,071
Dividends and dividend withholding tax
reclaims
receivable........................... 3,590,287
Interest receivable................... 16,241
Receivable for Fund shares sold (Note
2)................................... 2,401,345
Receivable for open forward foreign
currency contracts, net (Note 1)..... 4,097,822
Receivable for securities sold........ 33,563,554
Receivable from Chancellor LGT Asset
Management, Inc.
(Note 2)............................. --
Unamortized organizational costs (Note
1)................................... --
Miscellaneous receivable.............. 2,795
Cash held as collateral for securities
loaned (Note 1)...................... 219,016,373
--------------
Total assets........................ 1,881,818,503
--------------
Liabilities:
Payable for custodian fees (Note 1)... 53,360
Payable for Directors' and Trustees'
fees and expenses
(Note 2)............................. 10,561
Payable for fund accounting fees (Note
2)................................... 28,137
Payable for Fund shares repurchased
(Note 2)............................. 9,192,659
Payable for investment management and
administration fees (Note 2)......... 1,304,391
Payable for printing and postage
expenses............................. 88,523
Payable for professional fees......... 45,691
Payable for registration and filing
fees................................. 40,001
Payable for securities purchased...... --
Payable for service and distribution
expenses (Note 2).................... 1,033,888
Payable for transfer agent fees (Note
2)................................... 673,270
Other accrued expenses................ 43,177
Collateral for securities loaned (Note
1)................................... 219,016,373
--------------
Total liabilities................... 231,530,031
Minority interest (Notes 1 & 2)....... --
--------------
Net assets.............................. $1,650,288,472
--------------
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F24
<PAGE>
GT GLOBAL THEME FUNDS
STATEMENT OF ASSETS
AND LIABILITIES (cont'd)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
-----------------------------------------------------------------------------
CONSUMER NATURAL
PRODUCTS AND FINANCIAL INFRASTRUCTURE RESOURCES
SERVICES FUND- SERVICES FUND- HEALTH FUND- FUND-
CONSOLIDATED CONSOLIDATED CARE CONSOLIDATED CONSOLIDATED
Class A: (NOTE 1) (NOTE 1) FUND (NOTE 1) (NOTE 1)
-------------- -------------- ------------ -------------- ------------
<S> <C> <C> <C> <C> <C>
Net assets............................ $ 62,363,677 $20,584,300 $389,919,127 $ 42,911,693 $ 46,344,117
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Shares outstanding.................... 3,507,848 1,383,057 18,460,118 2,948,903 3,255,035
Net asset value and redemption price
per share............................ $ 17.78 $ 14.88 $ 21.12 $ 14.55 $ 14.24
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Maximum offering price per share
(100/95.25 of Class A net asset
value) *............................. $ 18.67 $ 15.62 $ 22.17 $ 15.28 $ 14.95
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Class B:+
Net assets............................ $ 88,135,720 $25,028,230 $114,215,914 $ 60,953,766 $ 62,925,204
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Shares outstanding.................... 5,018,466 1,702,870 5,534,099 4,251,948 4,469,417
Net asset value and offering price per
share................................ $ 17.56 $ 14.70 $ 20.64 $ 14.34 $ 14.08
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Advisor Class:
Net assets............................ $ 874,248 $ 170,783 $ 970,718 $ 458,457 $ 1,895,933
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Shares outstanding.................... 48,601 11,385 45,515 31,128 132,480
Net asset value, offering price per
share, and redemption price per
share................................ $ 17.99 $ 15.00 $ 21.33 $ 14.73 $ 14.31
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
Net assets consist of:
Paid in capital (Note 4).............. $163,180,646 $42,378,683 $457,515,917 $ 88,972,236 $120,314,207
Undistributed/Accumulated net
investment income (loss)............. (778,103) 146,451 (3,108,110) (291,638) (1,105,369)
Accumulated net realized gain (loss)
on investments and foreign currency
transactions......................... (12,480,366) 1,028,664 96,081,314 3,612,113 (2,829,243)
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... (13,822) (14,234) (18,216) 66,968 (46,798)
Net unrealized appreciation
(depreciation) of investments........ 1,465,290 2,243,749 (45,365,146) 11,964,237 (5,167,543)
-------------- -------------- ------------ -------------- ------------
Total -- representing net assets
applicable to capital shares
outstanding............................ $151,373,645 $45,783,313 $505,105,759 $104,323,916 $111,165,254
-------------- -------------- ------------ -------------- ------------
-------------- -------------- ------------ -------------- ------------
<CAPTION>
TELECOM-
MUNICATIONS
Class A: FUND
--------------
<S> <C>
Net assets............................ $ 876,878,838
--------------
--------------
Shares outstanding.................... 58,287,129
Net asset value and redemption price
per share............................ $ 15.04
--------------
--------------
Maximum offering price per share
(100/95.25 of Class A net asset
value) *............................. $ 15.79
--------------
--------------
Class B:+
Net assets............................ $ 772,573,604
--------------
--------------
Shares outstanding.................... 52,582,412
Net asset value and offering price per
share................................ $ 14.69
--------------
--------------
Advisor Class:
Net assets............................ $ 836,030
--------------
--------------
Shares outstanding.................... 54,984
Net asset value, offering price per
share, and redemption price per
share................................ $ 15.20
--------------
--------------
Net assets consist of:
Paid in capital (Note 4).............. $1,563,033,153
Undistributed/Accumulated net
investment income (loss)............. (11,385,919)
Accumulated net realized gain (loss)
on investments and foreign currency
transactions......................... (62,459,487)
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies........................... 4,069,291
Net unrealized appreciation
(depreciation) of investments........ 157,031,434
--------------
Total -- representing net assets
applicable to capital shares
outstanding............................ $1,650,288,472
--------------
--------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
F25
<PAGE>
GT GLOBAL THEME FUNDS
STATEMENT OF OPERATIONS
Six months ended April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------------------
CONSUMER NATURAL
PRODUCTS AND FINANCIAL HEALTH INFRASTRUCTURE RESOURCES TELECOM-
SERVICES FUND- SERVICES FUND- CARE FUND- FUND- MUNICATIONS
CONSOLIDATED CONSOLIDATED FUND CONSOLIDATED CONSOLIDATED FUND
-------------- -------------- ------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Investment income:
Dividend income (net of
foreign withholding tax of
$48,892, $42,741, $33,628,
$65,168, $10,948, and
$425,802, respectively).... $ 652,655 $ 458,223 $ 653,690 $ 659,414 $ 189,948 $ 6,679,275
Interest income............. 392,777 68,192 1,714,481 230,821 257,265 594,361
Other income................ 2,814 -- 156,682 -- -- 1,807,526
-------------- -------------- ------------- -------------- ------------ ------------
Total investment income... 1,048,246 526,415 2,524,853 890,235 447,213 9,081,162
-------------- -------------- ------------- -------------- ------------ ------------
Expenses:
Investment management and
administration fees (Note
2)......................... 833,539 140,029 2,889,695 498,029 641,102 9,212,272
Amortization of organization
costs (Note 1)............. 5,107 6,259 -- 5,108 1,100 --
Audit fees.................. 17,195 20,996 23,711 26,788 28,679 30,589
Custodian Fees (Note 1)..... 29,240 16,277 29,859 12,717 24,237 413,200
Directors' and Trustees'
fees and expenses (Note
2)......................... 5,836 7,783 6,697 7,964 8,184 13,575
Fund accounting fees (Note
2)......................... 21,392 3,595 74,413 12,761 16,477 245,575
Legal fees.................. 9,050 9,050 7,783 9,050 5,678 8,688
Printing and postage
expenses................... 26,427 26,064 90,590 25,761 23,695 209,055
Registration and filing
fees....................... 52,263 32,367 58,644 39,349 44,010 104,662
Service and distribution
expenses: (Note 2)
Class A................... 187,524 30,259 1,171,974 105,848 144,450 2,628,611
Class B................... 467,219 82,724 622,998 296,742 352,921 4,556,751
Transfer agent fees (Note
2)......................... 271,348 70,473 695,040 169,072 279,346 2,965,962
Other expenses (Note 1)..... 175 5,061 36,136 12,418 34,419 554,614
-------------- -------------- ------------- -------------- ------------ ------------
Total expenses before
reductions............... 1,926,315 450,937 5,707,540 1,221,607 1,604,298 20,943,554
-------------- -------------- ------------- -------------- ------------ ------------
Expenses reimbursed by
Chancellor LGT Asset
Management, Inc. (Note
2)..................... -- (63,328) -- -- -- --
Expense reductions
(Notes 1 & 5).......... (99,966) (7,645) (74,577) (39,734) (51,716) (470,939)
-------------- -------------- ------------- -------------- ------------ ------------
Total net expenses........ 1,826,349 379,964 5,632,963 1,181,873 1,552,582 20,472,615
-------------- -------------- ------------- -------------- ------------ ------------
Net investment income
(loss)....................... (778,103) 146,451 (3,108,110) (291,638) (1,105,369) (11,391,453)
-------------- -------------- ------------- -------------- ------------ ------------
Net realized and unrealized
gain (loss) on investments
and foreign currencies:
(Note 1)
Net realized gain (loss) on
investments................ (12,137,112) 1,148,925 97,799,083 3,439,692 (1,990,383) (70,777,320)
Net realized gain (loss) on
foreign currency
transactions............... (213,617) (12,060) 407,154 298,656 (161,453) 16,200,460
-------------- -------------- ------------- -------------- ------------ ------------
Net realized gain (loss)
during the year.......... (12,350,729) 1,136,865 98,206,237 3,738,348 (2,151,836) (54,576,860)
-------------- -------------- ------------- -------------- ------------ ------------
Net change in unrealized
depreciation on translation
of assets and liabilities
in foreign currencies...... (13,709) (21,864) (330,630) (5,257) (63,673) (315,312)
Net change in unrealized
appreciation (depreciation)
of investments............. (7,797,671) 852,237 (107,506,731) 1,837,078 (20,933,673) 48,853,436
-------------- -------------- ------------- -------------- ------------ ------------
Net unrealized
appreciation
(depreciation) during the
period................... (7,811,380) 830,373 (107,837,361) 1,831,821 (20,997,346) 48,538,124
-------------- -------------- ------------- -------------- ------------ ------------
Net realized and unrealized
gain (loss) on investments
and foreign currencies....... (20,162,109) 1,967,238 (9,631,124) 5,570,169 (23,149,182) (6,038,736)
-------------- -------------- ------------- -------------- ------------ ------------
Net increase (decrease) in net
assets resulting from
operations................... $(20,940,212) $2,113,689 $ (12,739,234) $5,278,531 $(24,254,551) $(17,430,189)
-------------- -------------- ------------- -------------- ------------ ------------
-------------- -------------- ------------- -------------- ------------ ------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F26
<PAGE>
GT GLOBAL THEME FUNDS
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GT GLOBAL
--------------------------------------------------------------------------------------
CONSUMER PRODUCTS AND FINANCIAL SERVICES HEALTH CARE
SERVICES FUND-CONSOLIDATED FUND-CONSOLIDATED FUND
--------------------------------- --------------------------------- --------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
APRIL 30, 1997 YEAR ENDED APRIL 30, 1997 YEAR ENDED APRIL 30, 1997
(UNAUDITED) OCTOBER 31, 1996 (UNAUDITED) OCTOBER 31, 1996 (UNAUDITED)
-------------- ---------------- -------------- ---------------- --------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ (778,103) $ (806,945) $ 146,451 $ 18,823 $ (3,108,110)
Net realized gain (loss) on
investments and foreign
currency transactions...... (12,350,729) 8,472,742 1,136,865 1,764,380 98,206,237
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. (13,709) (7,034) (21,864) (6,352) (330,630)
Net change in unrealized
appreciation (depreciation)
of investments............. (7,797,671) 8,880,649 852,237 615,083 (107,506,731)
-------------- ---------------- -------------- ---------------- --------------
Net increase (decrease) in
net assets resulting from
operations............... (20,940,212) 16,539,412 2,113,689 2,391,934 (12,739,234)
-------------- ---------------- -------------- ---------------- --------------
Class A:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- (56,390) --
From net realized gain on
investments................ (3,425,210) (217,050) (580,610) (8,739) (34,614,806)
Class B:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- (37,999) --
From net realized gain on
investments................ (4,055,201) (180,431) (823,696) (7,991) (8,701,206)
Advisor Class:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- (377) --
From net realized gain on
investments................ (308,573) (5,969) (5,018) (43) (57,488)
-------------- ---------------- -------------- ---------------- --------------
Total distributions....... (7,788,984) (403,450) (1,409,324) (111,539) (43,373,500)
-------------- ---------------- -------------- ---------------- --------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and
reinvested................. 98,527,857 241,650,741 55,707,604 19,900,814 721,085,418
Decrease from capital shares
repurchased................ (90,675,823) (92,740,871) (27,888,314) (15,187,336) (736,501,163)
-------------- ---------------- -------------- ---------------- --------------
Net increase (decrease)
from capital share
transactions............. 7,852,034 148,909,870 27,819,290 4,713,478 (15,415,745)
-------------- ---------------- -------------- ---------------- --------------
Total increase (decrease) in
net assets................... (20,877,162) 165,045,832 28,523,655 6,993,873 (71,528,479)
Net assets:
Beginning of period......... 172,250,807 7,204,975 17,259,658 10,265,785 576,634,238
-------------- ---------------- -------------- ---------------- --------------
End of period............... $ 151,373,645* $ 172,250,807* $ 45,783,313* $ 17,259,658* $ 505,105,759*
-------------- ---------------- -------------- ---------------- --------------
-------------- ---------------- -------------- ---------------- --------------
* Includes
undistributed/accumulated
net investment income
(loss)..................... $ (778,103) $ -- $ 146,451 $ -- $ (3,108,110)
-------------- ---------------- -------------- ---------------- --------------
-------------- ---------------- -------------- ---------------- --------------
<CAPTION>
YEAR ENDED
OCTOBER 31, 1996
----------------
<S> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ (4,508,835 )
Net realized gain (loss) on
investments and foreign
currency transactions...... 176,889,538
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. (547,070 )
Net change in unrealized
appreciation (depreciation)
of investments............. (53,392,951 )
----------------
Net increase (decrease) in
net assets resulting from
operations............... 118,440,682
----------------
Class A:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (54,405,334 )
Class B:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (9,956,648 )
Advisor Class:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (69,184 )
----------------
Total distributions....... (64,431,166 )
----------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and
reinvested................. 2,138,295,778
Decrease from capital shares
repurchased................ (2,113,330,083 )
----------------
Net increase (decrease)
from capital share
transactions............. 24,965,695
----------------
Total increase (decrease) in
net assets................... 78,975,211
Net assets:
Beginning of period......... 497,659,027
----------------
End of period............... $ 576,634,238 *
----------------
----------------
* Includes
undistributed/accumulated
net investment income
(loss)..................... $ --
----------------
----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F27
<PAGE>
GT GLOBAL THEME FUNDS
STATEMENT OF CHANGES IN NET ASSETS (cont'd)
<TABLE>
<CAPTION>
GT GLOBAL
---------------------------------------------------------------------------------------
INFRASTRUCTURE NATURAL RESOURCES TELECOMMUNICATIONS
FUND-CONSOLIDATED FUND-CONSOLIDATED FUND
--------------------------------- --------------------------------- ---------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
APRIL 30, 1997 YEAR ENDED APRIL 30, 1997 YEAR ENDED APRIL 30, 1997
(UNAUDITED) OCTOBER 31, 1996 (UNAUDITED) OCTOBER 31, 1996 (UNAUDITED)
-------------- ---------------- -------------- ---------------- ---------------
<S> <C> <C> <C> <C> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ (291,638) $ (421,987) $ (1,105,369) $ (1,055,526) $ (11,391,453)
Net realized gain (loss) on
investments and foreign
currency transactions...... 3,738,348 5,308,138 (2,151,836) 7,316,705 (54,576,860)
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. (5,257) (86,155) (63,673) 65,378 (315,312)
Net change in unrealized
appreciation (depreciation)
of investments............. 1,837,078 9,582,726 (20,933,673) 14,910,009 48,853,436
-------------- ---------------- -------------- ---------------- ---------------
Net increase (decrease) in
net assets resulting from
operations............... 5,278,531 14,382,722 (24,254,551) 21,236,566 (17,430,189)
-------------- ---------------- -------------- ---------------- ---------------
Class A:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- (46,497) --
From net realized gain on
investments................ (1,943,416) -- (1,916,175) (9,643) (95,677,108)
Class B:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- -- --
From net realized gain on
investments................ (2,732,936) -- (2,367,869) (10,136) (83,595,488)
Advisor Class:
Distributions to shareholders:
(Note 1)
From net investment
income..................... -- -- -- (853) --
From net realized gain on
investments................ (17,129) -- (134,145) (69) (176,806)
-------------- ---------------- -------------- ---------------- ---------------
Total distributions....... (4,693,481) -- (4,418,189) (67,198) (179,449,402)
-------------- ---------------- -------------- ---------------- ---------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and
reinvested................. 33,091,688 42,853,853 193,226,438 219,606,793 1,340,696,983
Decrease from capital shares
repurchased................ (21,771,413) (51,456,466) (165,367,667) (155,468,156) (1,706,555,585)
-------------- ---------------- -------------- ---------------- ---------------
Net increase (decrease)
from capital share
transactions............. 11,320,275 (8,602,613) 27,858,771 64,138,637 (365,858,602)
-------------- ---------------- -------------- ---------------- ---------------
Total increase (decrease) in
net assets................... 11,905,325 5,780,109 (813,969) 85,308,005 (562,738,193)
Net assets:
Beginning of period......... 92,418,591 86,638,482 111,979,223 26,671,218 2,213,026,665
-------------- ---------------- -------------- ---------------- ---------------
End of period............... $ 104,323,916* $ 92,418,591* $ 111,165,254* $ 111,979,223* $ 1,650,288,472*
-------------- ---------------- -------------- ---------------- ---------------
-------------- ---------------- -------------- ---------------- ---------------
* Includes
undistributed/accumulated
net investment income
(loss)..................... $ (291,638) $ -- $ (1,105,369) $ -- $ (11,385,919)
-------------- ---------------- -------------- ---------------- ---------------
-------------- ---------------- -------------- ---------------- ---------------
<CAPTION>
YEAR ENDED
OCTOBER 31, 1996
----------------
<S> <C>
Increase (decrease) in net
assets
Operations:
Net investment income
(loss)..................... $ (26,498,477)
Net realized gain (loss) on
investments and foreign
currency transactions...... 230,489,793
Net change in unrealized
appreciation (depreciation)
on translation of assets
and liabilities in foreign
currencies................. (21,852,465)
Net change in unrealized
appreciation (depreciation)
of investments............. (5,766,662)
----------------
Net increase (decrease) in
net assets resulting from
operations............... 176,372,189
----------------
Class A:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (64,901,484)
Class B:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (54,643,650)
Advisor Class:
Distributions to shareholders:
(Note 1)
From net investment
income..................... --
From net realized gain on
investments................ (33,321)
----------------
Total distributions....... (119,578,455)
----------------
Capital share transactions:
(Note 4)
Increase from capital shares
sold and
reinvested................. 3,156,330,159
Decrease from capital shares
repurchased................ (3,466,020,319)
----------------
Net increase (decrease)
from capital share
transactions............. (309,690,160)
----------------
Total increase (decrease) in
net assets................... (252,896,426)
Net assets:
Beginning of period......... 2,465,923,091
----------------
End of period............... $ 2,213,026,665*
----------------
----------------
* Includes
undistributed/accumulated
net investment income
(loss)..................... $ --
----------------
----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F28
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
CONSUMER PRODUCTS AND SERVICES FUND
--------------------------------------------------------------------------
CLASS A CLASS B
---------------------------------------------- --------------------------
SIX MONTHS DECEMBER 30, 1994 SIX MONTHS
ENDED (COMMENCEMENT ENDED
APRIL 30, YEAR ENDED OF OPERATIONS) APRIL 30, YEAR ENDED
1997 OCTOBER 31, TO OCTOBER 31, 1997 OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 (D) (UNAUDITED) (D) 1996 (D)
------------- ----------- ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 20.98 $ 14.59 $ 11.43 $ 20.79 $ 14.53
------------- ----------- -------- ------------- -----------
Income from investment operations:
Net investment income (loss).......... (0.07) (0.22) 0.02* (0.10) (0.31)
Net realized and unrealized gain
(loss) on investments................ (2.22) 7.13 3.14 (2.22) 7.09
------------- ----------- -------- ------------- -----------
Net increase (decrease) from
investment operations.............. (2.29) 6.91 3.16 (2.32) 6.78
------------- ----------- -------- ------------- -----------
Distributions to shareholders:
From net realized gain on
investments.......................... (0.91) (0.52) -- (0.91) (0.52)
------------- ----------- -------- ------------- -----------
Total distributions................. (0.91) (0.52) -- (0.91) (0.52)
------------- ----------- -------- ------------- -----------
Net asset value, end of period.......... $ 17.78 $ 20.98 $ 14.59 $ 17.56 $ 20.79
------------- ----------- -------- ------------- -----------
------------- ----------- -------- ------------- -----------
Total investment return (c)............. (11.47)%(b) 48.82% 27.65 % (b) (11.68)%(b) 48.11%
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 62,364 $ 76,900 $ 4,082 $ 88,136 $ 87,904
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... (0.64)%(a) (1.14)% 0.20 % (a) (1.14)%(a) (1.64)%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.76)%(a) (1.24)% (11.11)% (a) (1.26)%(a) (1.74)%
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... 1.87%(a) 2.24% 2.32 % (a) 2.37%(a) 2.74%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 1.99%(a) 2.34% 13.63 % (a) 2.49%(a) 2.84%
Portfolio turnover rate++............... 425%(a) 169% 240 % (a) 425%(a) 169%
Average commission rate per share paid
on portfolio transactions++............ $ 0.0352 $ 0.0545 N/A $ 0.0352 $ 0.0545
<CAPTION>
DECEMBER 30, 1994
(COMMENCEMENT
OF OPERATIONS)
TO OCTOBER 31,
1995 (D)
------------------
<S> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.43
--------
Income from investment operations:
Net investment income (loss).......... (0.04) *
Net realized and unrealized gain
(loss) on investments................ 3.14
--------
Net increase (decrease) from
investment operations.............. 3.10
--------
Distributions to shareholders:
From net realized gain on
investments.......................... --
--------
Total distributions................. --
--------
Net asset value, end of period.......... $ 14.53
--------
--------
Total investment return (c)............. 27.12 % (b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 2,959
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... (0.30)% (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (11.61)% (a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... 2.82 % (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 14.13 % (a)
Portfolio turnover rate++............... 240 % (a)
Average commission rate per share paid
on portfolio transactions++............ N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., net
investment income per share would have been reduced by $1.12, $1.04
and $0.61 for Class A, Class B and Advisor Class, respectively.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F29
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
CONSUMER PRODUCTS AND SERVICES FUND
-----------------------------------------
ADVISOR CLASS+
-----------------------------------------
SIX MONTHS
ENDED JUNE 1, 1995
APRIL 30, YEAR ENDED TO
1997 OCTOBER 31, OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 (D)
------------- ----------- -------------
<S> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 21.15 $ 14.64 $ 11.84
------------- ----------- -------------
Income from investment operations:
Net investment income (loss).......... (0.03) (0.13) 0.04*
Net realized and unrealized gain
(loss) on investments................ (2.22) 7.16 2.76
------------- ----------- -------------
Net increase (decrease) from
investment operations.............. (2.25) 7.03 2.80
------------- ----------- -------------
Distributions to shareholders:
From net realized gain on
investments.......................... (0.91) (0.52) --
------------- ----------- -------------
Total distributions................. (0.91) (0.52) --
------------- ----------- -------------
Net asset value, end of period.......... $ 17.99 $ 21.15 $ 14.64
------------- ----------- -------------
------------- ----------- -------------
Total investment return (c)............. (11.18)%(b) 49.50% 23.65%(b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 874 $ 7,446 $ 164
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... (0.14)%(a) (0.64)% 0.70%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.26)%(a) (0.74)% (10.61)%(a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc.
(Notes 1, 2 & 5)..................... 1.37%(a) 1.74% 1.82%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 1.49%(a) 1.84% 13.13%(a)
Portfolio turnover rate++............... 425%(a) 169% 240%(a)
Average commission rate per share paid
on portfolio transactions++............ $ 0.0352(a) $ 0.0545 N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., net
investment income per share would have been reduced by $1.12, $1.04
and $0.61 for Class A, Class B and Advisor Class, respectively.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F30
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
FINANCIAL SERVICES FUND
----------------------------------------------------------
CLASS A
----------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31, MAY 31, 1994
APRIL 30, (COMMENCEMENT OF
1997 ----------------------- OPERATIONS) TO
(UNAUDITED) (D) 1996 (D) 1995 (D) OCTOBER 31, 1994
------------- ---------- ----------- ------------------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 14.20 $ 11.92 $ 11.62 $ 11.43
------------- ---------- ----------- --------
Income from investment operations:
Net investment income (loss).......... 0.09* 0.05* * 0.17 * * 0.02* * * *
Net realized and unrealized gain on
investments.......................... 1.58 2.36 0.13 0.17
------------- ---------- ----------- --------
Net increase from investment
operations......................... 1.67 2.41 0.30 0.19
------------- ---------- ----------- --------
Distributions to shareholders:
From net investment income............ -- (0.12) -- --
From net realized gain on
investments.......................... (0.99) (0.01) -- --
------------- ---------- ----------- --------
Total distributions................. (0.99) (0.13) -- --
------------- ---------- ----------- --------
Net asset value, end of period.......... $ 14.88 $ 14.20 $ 11.92 $ 11.62
------------- ---------- ----------- --------
------------- ---------- ----------- --------
Total investment return (c)............. 12.40%(b) 20.21% 2.58% 1.66 % (b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 20,584 $ 7,302 $ 5,687 $ 3,175
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 1.30%(a) 0.41% 1.46% 0.66 % (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 0.81%(a) (0.66)% (5.34)% (7.26)% (a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 2.36%(a) 2.32% 2.34% 2.40 % (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.85%(a) 3.39% 9.14% 10.32 % (a)
Portfolio turnover rate++............... 127%(a) 103% 170% 53 % (a)
Average commission rate per share paid
on portfolio transactions++............ $ 0.0015 $ 0.0080 N/A N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.04 for each
of the three classes.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.13 for each
of the three classes.
* * * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.59, $0.59
and $0.30 for Class A, Class B and Advisor Class, respectively.
* * * * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.23 for Class
A and Class B.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F31
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
FINANCIAL SERVICES FUND
--------------------------------------------------------------------------------------
CLASS B ADVISOR CLASS+
---------------------------------------------------------- --------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED OCTOBER 31, MAY 31, 1994 ENDED
APRIL 30, (COMMENCEMENT OF APRIL 30, YEAR ENDED
1997 ----------------------- OPERATIONS) TO 1997 OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 (D) OCTOBER 31, 1994 (UNAUDITED) (D) 1996 (D)
------------- ---------- ----------- ------------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 14.06 $ 11.83 $ 11.60 $ 11.43 $ 14.26 $ 11.95
------------- ---------- ----------- -------- ------------- -----------
Income from investment operations:
Net investment income (loss).......... 0.05* (0.01) ** 0.11 * * 0.00 * * * 0.12* 0.12**
Net realized and unrealized gain on
investments.......................... 1.58 2.34 0.12 0.17 1.61 2.36
------------- ---------- ----------- -------- ------------- -----------
Net increase from investment
operations......................... 1.63 2.33 0.23 0.17 1.73 2.48
------------- ---------- ----------- -------- ------------- -----------
Distributions to shareholders:
From net investment income............ -- (0.09) -- -- -- (0.16)
From net realized gain on
investments.......................... (0.99) (0.01) -- -- (0.99) (0.01)
------------- ---------- ----------- -------- ------------- -----------
Total distributions................. (0.99) (0.10) -- -- (0.99) (0.17)
------------- ---------- ----------- -------- ------------- -----------
Net asset value, end of period.......... $ 14.70 $ 14.06 $ 11.83 $ 11.60 $ 15.00 $ 14.26
------------- ---------- ----------- -------- ------------- -----------
------------- ---------- ----------- -------- ------------- -----------
Total investment return (c)............. 11.99%(b) 19.81% 1.98% 1.49 % (b) 12.64%(b) 20.87%
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 25,028 $ 9,886 $ 4,548 $ 2,235 $ 171 $ 72
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 0.80%(a) (0.09)% 0.96% 0.16 % (a) 1.80%(a) 0.91%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 0.31%(a) (1.16)% (5.84)% (7.76)% (a) 1.31%(a) (0.16)%
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 2.86%(a) 2.82% 2.84% 2.90 % (a) 1.86%(a) 1.82%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 3.35%(a) 3.89% 9.64% 10.82 % (a) 2.35%(a) 2.89%
Portfolio turnover rate++............... 127%(a) 103% 170% 53 % (a) 127%(a) 103%
Average commission rate per share paid
on portfolio transactions++............ $ 0.0015 $ 0.0080 N/A N/A $ 0.0015 $ 0.0080
<CAPTION>
JUNE 1, 1995
TO
OCTOBER 31,
1995
-------------
<S> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.09
-------------
Income from investment operations:
Net investment income (loss).......... 0.09* * *
Net realized and unrealized gain on
investments.......................... 0.77
-------------
Net increase from investment
operations......................... 0.86
-------------
Distributions to shareholders:
From net investment income............ --
From net realized gain on
investments.......................... --
-------------
Total distributions................. --
-------------
Net asset value, end of period.......... $ 11.95
-------------
-------------
Total investment return (c)............. 7.75%(b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 31
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 1.96%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (4.84)%(a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1, 2 & 5).... 1.84%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 8.64%(a)
Portfolio turnover rate++............... 170%
Average commission rate per share paid
on portfolio transactions++............ N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.04 for each
of the three classes.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.13 for each
of the three classes.
* * * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.59, $0.59
and $0.30 for Class A, Class B and Advisor Class, respectively.
* * * * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.23 for Class
A and Class B.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F32
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
HEALTH CARE FUND
-----------------------------------------------------------------------
CLASS A+
-----------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1997 ---------------------------------------------------------
(UNAUDITED) 1996 (D) 1995 1994 (D) 1993 (D) 1992
----------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $ 23.60 $ 21.84 $ 19.60 $ 17.86 $ 17.44 $ 19.29
----------- --------- --------- --------- --------- ---------
Income from investment
operations:
Net investment loss......... (0.12) (0.17) (0.15) (0.22) (0.15) (0.18)
Net realized and unrealized
gain (loss) on
investments................ (0.51) 4.79 3.73 2.02 0.57 (1.53)
----------- --------- --------- --------- --------- ---------
Net increase (decrease)
from investment
operations............... (0.63) 4.62 3.58 1.80 0.42 (1.71)
----------- --------- --------- --------- --------- ---------
Distributions to shareholders:
From net realized gain on
investments................ (1.85) (2.86) (1.34) -- -- (0.14)
In excess of net realized
gain on investments........ -- -- -- (0.06) -- --
----------- --------- --------- --------- --------- ---------
Total distributions....... (1.85) (2.86) (1.34) (0.06) -- (0.14)
----------- --------- --------- --------- --------- ---------
Net asset value, end of
period....................... $ 21.12 $ 23.60 $ 21.84 $ 19.60 $ 17.86 $ 17.44
----------- --------- --------- --------- --------- ---------
----------- --------- --------- --------- --------- ---------
Total investment return (c)... (3.11)%(b) 23.14% 19.79% 10.11% 2.4% (8.9)%
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $389,919 $467,861 $426,380 $438,940 $461,113 $655,867
Ratio of net investment loss
to average net assets........ (0.94)%(a) (0.71)% (0.72)% (1.23)% (0.90)% (0.97)%
Ratio of expenses to average
net assets:
With expense reductions
(Notes 1 & 5).............. 1.79%(a) 1.80% 1.85% 1.98% 2.0% 2.05%
Without expense
reductions................. 1.81%(a) 1.84% 1.91% --%* --%* --%*
Portfolio turnover rate++++... 218%(a) 157% 99% 64% 61% 30%
Average commission rate per
share paid on portfolio
transactions++++............. $ 0.0545 $ 0.0548 N/A N/A N/A N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charge.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Calculation of "Ratios of expenses to average net assets" was made
without considering the effect of expense reduction, if any.
+ All capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++++ Portfolio turnover and average commission rates are calculated on the
basis of the Fund as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F33
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
HEALTH CARE FUND
-----------------------------------------------------------------------------------------
CLASS B++ ADVISOR CLASS+++
------------------------------------------------------------- -------------------------
SIX MONTHS SIX MONTHS
ENDED APRIL 1, 1993 ENDED
APRIL 30, YEAR ENDED OCTOBER 31, TO APRIL 30, YEAR ENDED
1997 ------------------------------- OCTOBER 31, 1997 OCTOBER 31,
(UNAUDITED) 1996 (D) 1995 (D) 1994 (D) 1993 (D) (UNAUDITED) 1996 (D)
----------- --------- -------- -------- ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $ 23.15 $ 21.56 $ 19.46 $ 17.80 $15.59 $ 23.77 $ 21.88
----------- --------- -------- -------- ------------- ----------- -----------
Income from investment
operations:
Net investment loss......... (0.15) (0.27) (0.25) (0.32) (0.14) (0.08) (0.05)
Net realized and unrealized
gain (loss) on
investments................ (0.51) 4.72 3.69 2.02 2.35 (0.51) 4.80
----------- --------- -------- -------- ------------- ----------- -----------
Net increase (decrease)
from investment
operations............... (0.66) 4.45 3.44 1.70 2.21 (0.59) 4.75
----------- --------- -------- -------- ------------- ----------- -----------
Distributions to shareholders:
From net realized gain on
investments................ (1.85) (2.86) (1.34) -- -- (1.85) (2.86)
In excess of net realized
gain on investments........ -- -- -- (0.04) -- -- --
----------- --------- -------- -------- ------------- ----------- -----------
Total distributions....... (1.85) (2.86) (1.34) (0.04) -- (1.85) (2.86)
----------- --------- -------- -------- ------------- ----------- -----------
Net asset value, end of
period....................... $ 20.64 $ 23.15 $ 21.56 $ 19.46 $17.80 $ 21.33 $ 23.77
----------- --------- -------- -------- ------------- ----------- -----------
----------- --------- -------- -------- ------------- ----------- -----------
Total investment return (c)... (3.31)%(b) 22.59% 19.17% 9.55% 14.20% (b) (2.91)%)(b) 23.82%
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $114,216 $107,622 $70,740 $39,100 $8,604 $ 971 $ 1,152
Ratio of net investment loss
to average net assets........ (1.44)%(a) (1.21)% (1.22)% (1.73)% (1.4)% (a) (0.44)% (a) (0.21)%
Ratio of expenses to average
net assets:
With expense reductions
(Notes 1 & 5).............. 2.29%(a) 2.30% 2.35% 2.48% 2.50% (a) 1.29% (a) 1.30%
Without expense
reductions................. 2.31%(a) 2.34% 2.41% --%* --% * 1.31% (a) 1.34%
Portfolio turnover rate++++... 218%(a) 157% 99% 64% 61% 218% (a) 157%
Average commission rate per
share paid on portfolio
transactions++++............. $ 0.0545 $ 0.0548 N/A N/A N/A $0.0545 $0.0548
<CAPTION>
JUNE 1, 1995
TO
OCTOBER 31,
1995
------------
<S> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $18.66
------------
Income from investment
operations:
Net investment loss......... (0.02)
Net realized and unrealized
gain (loss) on
investments................ 3.24
------------
Net increase (decrease)
from investment
operations............... 3.22
------------
Distributions to shareholders:
From net realized gain on
investments................ --
In excess of net realized
gain on investments........ --
------------
Total distributions....... --
------------
Net asset value, end of
period....................... $21.88
------------
------------
Total investment return (c)... 17.10% (b)
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $ 539
Ratio of net investment loss
to average net assets........ (0.22)% (a)
Ratio of expenses to average
net assets:
With expense reductions
(Notes 1 & 5).............. 1.35% (a)
Without expense
reductions................. 1.41% (a)
Portfolio turnover rate++++... 99%
Average commission rate per
share paid on portfolio
transactions++++............. N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charge.
(d) These selected per share data were calculated based upon weighted
average shares outstanding during the period.
* Calculation of "Ratios of expenses to average net assets" was made
without considering the effect of expense reduction, if any.
+ All capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++++ Portfolio turnover and average commission rates are calculated on the
basis of the Fund as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F34
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
INFRASTRUCTURE FUND
--------------------------------------------------------
CLASS A
--------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31, MAY 31, 1994
APRIL 30, (COMMENCEMENT OF
1997 ---------------------- OPERATIONS) TO
(UNAUDITED) (D) 1996 (D) 1995 OCTOBER 31, 1994
------------- ---------- ---------- -----------------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 14.42 $ 12.11 $ 12.47 $ 11.43
------------- ---------- ---------- -----------------
Income from investment operations:
Net investment income (loss).......... (0.02) (0.03) (0.03) * 0.01* *
Net realized and unrealized gain
(loss) on investments................ 0.87 2.34 (0.33) 1.03
------------- ---------- ---------- -----------------
Net increase (decrease) from
investment operations.............. 0.85 2.31 (0.36) 1.04
------------- ---------- ---------- -----------------
Distributions to shareholders:
From net realized gain on
investments.......................... (0.72) -- -- --
------------- ---------- ---------- -----------------
Total distributions................. (0.72) -- -- --
------------- ---------- ---------- -----------------
Net asset value, end of period.......... $ 14.55 $ 14.42 $ 12.11 $ 12.47
------------- ---------- ---------- -----------------
------------- ---------- ---------- -----------------
Total investment return (c)............. 6.02%(b) 19.08% (2.89)% 9.10% (b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 42,912 $ 38,397 $ 36,241 $ 23,615
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... (0.28)%(a) (0.19)% (0.32)% 0.41% (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.36)%(a) (0.30)% (0.58)% (0.47)% (a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 2.03%(a) 2.14% 2.36% 2.40% (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.11%(a) 2.25% 2.62% 3.28% (a)
Portfolio turnover rate++............... 49%(a) 41% 45% 18% (a)
Average commission rate per share paid
on portfolio transactions++............ $ 0.0035 $ 0.0109 N/A N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon average
shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.03 for Class
A shares, $0.03 for Class B shares, and $0.02 for Advisor Class
shares.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.02 for Class
A and Class B from May 31, 1994 to October 31, 1994.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F35
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
INFRASTRUCTURE FUND
------------------------------------------------------------------------------------
CLASS B ADVISOR CLASS+
-------------------------------------------------------- --------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED OCTOBER 31, MAY 31, 1994 ENDED
APRIL 30, (COMMENCEMENT OF APRIL 30, YEAR ENDED
1997 ---------------------- OPERATIONS) TO 1997 OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 OCTOBER 31, 1994 (UNAUDITED) (D) 1996 (D)
------------- ---------- ---------- ----------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 14.24 $ 12.03 $ 12.45 $ 11.43 $ 14.52 $ 12.14
------------- ---------- ---------- ----------------- ------------- -----------
Income from investment operations:
Net investment income (loss).......... (0.06) (0.09) (0.09) * (0.01) * * 0.02 0.04
Net realized and unrealized gain
(loss) on investments................ 0.88 2.30 (0.33) 1.03 0.91 2.34
------------- ---------- ---------- ----------------- ------------- -----------
Net increase (decrease) from
investment operations.............. 0.82 2.21 (0.42) 1.02 0.93 2.38
------------- ---------- ---------- ----------------- ------------- -----------
Distributions to shareholders:
From net realized gain on
investments.......................... (0.72) -- -- -- (0.72) --
------------- ---------- ---------- ----------------- ------------- -----------
Total distributions................. (0.72) -- -- -- (0.72) --
------------- ---------- ---------- ----------------- ------------- -----------
Net asset value, end of period.......... $ 14.34 $ 14.24 $ 12.03 $ 12.45 $ 14.73 $ 14.52
------------- ---------- ---------- ----------------- ------------- -----------
------------- ---------- ---------- ----------------- ------------- -----------
Total investment return (c)............. 5.80%(b) 18.37% (3.37)% 8.92% (b) 6.48%(b) 19.60%
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 60,954 $ 53,678 $ 50,181 $ 30,954 $ 458 $ 344
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... (0.78)%(a) (0.69)% (0.82)% (0.09)% (a) 0.22%(a) 0.31%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.86)%(a) (0.80)% (1.08)% (0.97)% (a) 0.14%(a) 0.20%
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 2.53%(a) 2.64% 2.86% 2.90% (a) 1.53%(a) 1.64%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.61%(a) 2.75% 3.12% 3.78% (a) 1.61%(a) 1.75%
Portfolio turnover rate++............... 49%(a) 41% 45% 18% (a) 49%(a) 41%
Average commission rate per share paid
on portfolio transactions++............ $ 0.0035 $ 0.0109 N/A N/A $ 0.0035 $ 0.0109
<CAPTION>
JUNE 1, 1995
TO
OCTOBER 31,
1995
-------------
<S> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 12.00
-------------
Income from investment operations:
Net investment income (loss).......... 0.02*
Net realized and unrealized gain
(loss) on investments................ 0.12
-------------
Net increase (decrease) from
investment operations.............. 0.14
-------------
Distributions to shareholders:
From net realized gain on
investments.......................... --
-------------
Total distributions................. --
-------------
Net asset value, end of period.......... $ 12.14
-------------
-------------
Total investment return (c)............. 1.17%(b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 216
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 0.18%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.08)%(a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 1.86%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.12%(a)
Portfolio turnover rate++............... 45%
Average commission rate per share paid
on portfolio transactions++............ N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon average
shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.03 for Class
A shares, $0.03 for Class B shares, and $0.02 for Advisor Class
shares.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.02 for Class
A and Class B from May 31, 1994 to October 31, 1994.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F36
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
NATURAL RESOURCES FUND
------------------------------------------------------
CLASS A
------------------------------------------------------
MAY 31, 1994
SIX MONTHS (COMMENCEMENT
ENDED YEAR ENDED OCTOBER 31, OF OPERATIONS)
APRIL 30, TO
1997 ---------------------- OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 1994
------------- ---------- ---------- ---------------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 17.43 $ 11.44 $ 12.41 $ 11.43
------------- ---------- ---------- ---------------
Income from investment operations:
Net investment income (loss).......... (0.12) (0.24) 0.04* 0.06* *
Net realized and unrealized gain
(loss) on investments................ (2.46) 6.28 (0.98) 0.92
------------- ---------- ---------- ---------------
Net increase (decrease) from
investment operations.............. (2.58) 6.04 (0.94) 0.98
------------- ---------- ---------- ---------------
Distributions to shareholders:
From net investment income............ -- (0.04) (0.03) --
From net realized gain on
investments.......................... (0.61) (0.01) -- --
------------- ---------- ---------- ---------------
Total distributions................. (0.61) (0.05) (0.03) --
------------- ---------- ---------- ---------------
Net asset value, end of period.......... $ 14.24 $ 17.43 $ 11.44 $ 12.41
------------- ---------- ---------- ---------------
------------- ---------- ---------- ---------------
Total investment return (c)............. (15.43)%(b) 53.04% (7.58)% 8.57% (b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 46,344 $ 48,729 $ 12,598 $ 14,797
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... (1.42)%(a) (1.55)% 0.41% 2.63% (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (1.50)%(a) (1.65)% (0.69)% 0.65% (a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 2.10%(a) 2.20% 2.37% 2.40% (a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.18%(a) 2.30% 3.47% 4.38% (a)
Portfolio turnover rate++............... 395%(a) 94% 87% 137%
Average commission rate per share paid
on portfolio transactions++............ $ 0.0085 $ 0.0243 N/A N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon average
shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income (loss) per share would have been reduced (increased)
by $0.14, $0.13 and $0.12 for Class A, Class B and Advisor Class,
respectively.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.04 for Class
A and Class B.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F37
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout the period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
NATURAL RESOURCES FUND
----------------------------------------------------------------------------------
CLASS B
------------------------------------------------------ ADVISOR CLASS+
MAY 31, 1994 --------------------------
SIX MONTHS (COMMENCEMENT SIX MONTHS
ENDED YEAR ENDED OCTOBER 31, OF OPERATIONS) ENDED
APRIL 30, TO APRIL 30, YEAR ENDED
1997 ---------------------- OCTOBER 31, 1997 OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 1994 (UNAUDITED) (D) 1996 (D)
------------- ---------- ---------- --------------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 17.29 $ 11.36 $ 12.38 $ 11.43 $ 17.47 $ 11.47
------------- ---------- ---------- --------------- ------------- -----------
Income from investment operations:
Net investment income (loss).......... (0.14) (0.31) (0.02) * 0.03* * (0.09) (0.17)
Net realized and unrealized gain
(loss) on investments................ (2.46) 6.25 (0.98) 0.92 (2.46) 6.28
------------- ---------- ---------- --------------- ------------- -----------
Net increase (decrease) from
investment operations.............. (2.60) 5.94 (1.00) 0.95 (2.55) 6.11
------------- ---------- ---------- --------------- ------------- -----------
Distributions to shareholders:
From net investment income............ -- -- (0.02) -- -- (0.10)
From net realized gain on
investments.......................... (0.61) (0.01) -- -- (0.61) (0.01)
------------- ---------- ---------- --------------- ------------- -----------
Total distributions................. (0.61) (0.01) (0.02) -- (0.61) (0.11)
------------- ---------- ---------- --------------- ------------- -----------
Net asset value, end of period.......... $ 14.08 $ 17.29 $ 11.36 $ 12.38 $ 14.31 $ 17.47
------------- ---------- ---------- --------------- ------------- -----------
------------- ---------- ---------- --------------- ------------- -----------
Total investment return (c)............. (15.68)%(b) 52.39% (8.05)% 8.31% (b) (15.22)%(b) 53.76%
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 62,925 $ 57,749 $ 13,978 $ 13,404 $ 1,896 $ 5,502
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... (1.92)%(a) (2.05)% (0.09)% 2.13% (a) (0.92)%(a) (1.05)%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (2.00)%(a) (2.15)% (1.19)% 0.15% (a) (1.00)%(a) (1.15)%
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 2.60%(a) 2.70% 2.87% 2.90% (a) 1.60%(a) 1.70%
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.68%(a) 2.80% 3.97% 4.88% (a) 1.68%(a) 1.80%
Portfolio turnover rate++............... 395%(a) 94% 87% 137% 395%(a) 94%
Average commission rate per share paid
on portfolio transactions++............ $ 0.0085 $ 0.0243 N/A N/A $ 0.0085 $ 0.0243
<CAPTION>
JUNE 1, 1995
TO
OCTOBER 31,
1995
-------------
<S> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 11.45
-------------
Income from investment operations:
Net investment income (loss).......... 0.11*
Net realized and unrealized gain
(loss) on investments................ (0.09)
-------------
Net increase (decrease) from
investment operations.............. 0.02
-------------
Distributions to shareholders:
From net investment income............ --
From net realized gain on
investments.......................... --
-------------
Total distributions................. --
-------------
Net asset value, end of period.......... $ 11.47
-------------
-------------
Total investment return (c)............. 0.17%(b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $ 95
Ratio of net investment income (loss) to
average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 0.91%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... (0.19)%(a)
Ratio of expenses to average net assets:
With expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc. (Notes 1 & 5)....... 1.87%(a)
Without expense reductions and
reimbursement by Chancellor LGT Asset
Management, Inc...................... 2.97%(a)
Portfolio turnover rate++............... 87%
Average commission rate per share paid
on portfolio transactions++............ N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not annualized.
(c) Total investment return does not include sales charges.
(d) These selected per share data were calculated based upon average
shares outstanding during the period.
* Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income (loss) per share would have been reduced (increased)
by $0.14, $0.13 and $0.12 for Class A, Class B and Advisor Class,
respectively.
* * Before reimbursement by Chancellor LGT Asset Management, Inc., the net
investment income per share would have been reduced by $0.04 for Class
A and Class B.
+ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++ Portfolio turnover and average commission rates are calculated on the
basis of the Portfolio as a whole without distinguishing between the
classes of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F38
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
TELECOMMUNICATIONS FUND
-----------------------------------------------------------------------------------------
CLASS A+
-----------------------------------------------------------------------------------------
JANUARY 27, 1992
SIX MONTHS (COMMENCEMENT
ENDED YEAR ENDED OCTOBER 31, OF OPERATIONS)
APRIL 30, 1997 ----------------------------------------------------- TO OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 1994 (D) 1993 1992
-------------- ----------- ----------- ----------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.... $ 16.69 $ 16.42 $ 17.80 $ 16.92 $ 11.16 $ 11.43
-------------- ----------- ----------- ----------- ----------- ----------------
Income from investment operations:
Net investment income (loss).......... (0.08) (0.13) (0.09) (0.01) 0.08 0.14*
Net realized and unrealized gain
(loss) on investments................ (0.16) 1.22 (0.43) 1.17 5.83 (0.41)
-------------- ----------- ----------- ----------- ----------- ----------------
Net increase (decrease) from
investment operations.............. (0.24) 1.09 (0.52) 1.16 5.91 (0.27)
-------------- ----------- ----------- ----------- ----------- ----------------
Distributions to shareholders:
From net investment income............ -- -- -- (0.01) (0.15) --
From net realized gain on
investments.......................... (1.41) (0.82) (0.86) (0.27) -- --
-------------- ----------- ----------- ----------- ----------- ----------------
Total distributions................. (1.41) (0.82) (0.86) (0.28) (0.15) --
-------------- ----------- ----------- ----------- ----------- ----------------
Net asset value, end of period.......... $ 15.04 $ 16.69 $ 16.42 $ 17.80 $ 16.92 $ 11.16
-------------- ----------- ----------- ----------- ----------- ----------------
-------------- ----------- ----------- ----------- ----------- ----------------
Total investment return (c)............. (1.81)% (b) 7.00% (2.88)% 7.02% 53.60% (2.4)% (b)
Ratios and supplemental data:
Net assets, end of period (in 000's).... $876,879 $1,204,428 $1,353,722 $1,644,402 $1,223,340 $442,862
Ratio of net investment income (loss) to
average net assets..................... (0.93)% (a) (0.84)% (0.49)% (0.02)% 0.80% 2.1% (a)
Ratio of expenses to average net assets:
With expense reductions (Notes 1 &
5)................................... 1.84% (a) 1.74% 1.77% 1.80% 2.0% 2.3% (a)
Without expense reductions............ 1.89% (a) 1.79% 1.83% --%** --%** --% * *
Portfolio turnover rate++++............. 27% (a) 37% 62% 57% 41% 4% (a)
Average commission rate per share paid
on portfolio transactions++++.......... $ 0.0125 $ 0.0165 N/A N/A N/A N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charge.
(d) These selected per share data were calculated based upon the weighted
average shares outstanding during the period.
* Includes reimbursements by Chancellor LGT Asset Management, Inc. of
Fund operating expenses of less than $0.01. Without such
reimbursement, the annualized expense ratio would have been 2.30% and
the annualized ratio of net investment income to average net assets
would have been 2.04% (See Note 2).
* * Calculation of "Ratio of expenses to average net assets" was made
without considering the effect of expense reductions, if any.
+ All capital shares issued and outstanding March 31, 1993 were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++++ Portfolio turnover and average commission rates are calculated on the
basis of the Fund as whole without distinguishing between the classes
of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F39
<PAGE>
GT GLOBAL THEME FUNDS
FINANCIAL HIGHLIGHTS (cont'd)
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
TELECOMMUNICATIONS FUND
------------------------------------------------------------------------
CLASS B++
------------------------------------------------------------------------
SIX MONTHS APRIL 1, 1993
ENDED YEAR ENDED OCTOBER 31, TO
APRIL 30, 1997 --------------------------------------- OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995 1994 (D) 1993
-------------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $ 16.37 $ 16.20 $ 17.66 $ 16.87 $ 12.68
-------------- ----------- ----------- ----------- -------------
Income from investment
operations:
Net investment income
(loss)..................... (0.11) (0.23) (0.17) (0.10) 0.01
Net realized and unrealized
gain (loss) on
investments................ (0.16) 1.22 (0.43) 1.17 4.18
-------------- ----------- ----------- ----------- -------------
Net increase (decrease)
from investment
operations............... (0.27) 0.99 (0.60) 1.07 4.19
-------------- ----------- ----------- ----------- -------------
Distributions to shareholders:
From net investment
income..................... -- -- -- (0.01) --
From net realized gain on
investments................ (1.41) (0.82) (0.86) (0.27) --
-------------- ----------- ----------- ----------- -------------
Total distributions....... (1.41) (0.82) (0.86) (0.28) --
-------------- ----------- ----------- ----------- -------------
Net asset value, end of
period....................... $ 14.69 $ 16.37 $ 16.20 $ 17.66 $ 16.87
-------------- ----------- ----------- ----------- -------------
-------------- ----------- ----------- ----------- -------------
Total investment return (c)... (2.04)% (b) 6.46% (3.37)% 6.50% 33.0% (b)
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $772,574 $1,007,654 $1,111,520 $1,184,081 $455,335
Ratio of net investment income
(loss) to average net
assets....................... (1.43)% (a) (1.34)% (0.99)% (0.52)% 0.3% (a)
Ratio of expenses to average
net assets:
With expense reductions
(Notes 1 & 5).............. 2.34% (a) 2.24% 2.27% 2.30% 2.5% (a)
Without expense
reductions................. 2.39% (a) 2.29% 2.33% --%* --% *
Portfolio turnover rate++++... 27% (a) 37% 62% 57% 41%
Average commission rate per
share paid on portfolio
transactions++++............. $ 0.0125 $ 0.0165 N/A N/A N/A
<CAPTION>
ADVISOR CLASS+++
-------------------------------------------
SIX MONTHS JUNE 1, 1995
ENDED YEAR ENDED TO
APRIL 30, 1997 OCTOBER 31, OCTOBER 31,
(UNAUDITED) (D) 1996 (D) 1995
-------------- ----------- ------------
<S> <C> <C> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $ 16.81 $ 16.46 $15.24
-------------- ----------- ------------
Income from investment
operations:
Net investment income
(loss)..................... (0.04) (0.05) --
Net realized and unrealized
gain (loss) on
investments................ (0.16) 1.22 1.22
-------------- ----------- ------------
Net increase (decrease)
from investment
operations............... (0.20) 1.17 1.22
-------------- ----------- ------------
Distributions to shareholders:
From net investment
income..................... -- -- --
From net realized gain on
investments................ (1.41) (0.82) --
-------------- ----------- ------------
Total distributions....... (1.41) (0.82) --
-------------- ----------- ------------
Net asset value, end of
period....................... $ 15.20 $ 16.81 $16.46
-------------- ----------- ------------
-------------- ----------- ------------
Total investment return (c)... (1.54)% (b) 7.49% 7.94% (b)
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $ 836 $ 945 $ 681
Ratio of net investment income
(loss) to average net
assets....................... (0.43)% (a) (0.34)% 0.01% (a)
Ratio of expenses to average
net assets:
With expense reductions
(Notes 1 & 5).............. 1.34% (a) 1.24% 1.27% (a)
Without expense
reductions................. 1.39% (a) 1.29% 1.33% (a)
Portfolio turnover rate++++... 27% (a) 37% 62%
Average commission rate per
share paid on portfolio
transactions++++............. $0.0125 $0.0165 N/A
</TABLE>
- ----------------
(a) Annualized.
(b) Not Annualized.
(c) Total investment return does not include sales charge.
(d) These selected per share data were calculated based upon the weighted
average shares outstanding during the period.
* Includes reimbursements by Chancellor LGT Asset Management, Inc. of
Fund operating expenses of less than $0.01. Without such
reimbursement, the annualized expense ratio would have been 2.30% and
the annualized ratio of net investment income to average net assets
would have been 2.04% (See Note 2).
* * Calculation of "Ratio of expenses to average net assets" was made
without considering the effect of expense reductions, if any.
+ All capital shares issued and outstanding March 31, 1993 were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Commencing June 1, 1995, the Fund began offering Advisor Class shares.
++++ Portfolio turnover and average commission rates are calculated on the
basis of the Fund as whole without distinguishing between the classes
of shares issued.
N/A Not Applicable.
The accompanying notes are an integral part of the financial statements.
F40
<PAGE>
GT GLOBAL THEME FUNDS
NOTES TO
FINANCIAL STATEMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
GT Global Consumer Products and Services Fund, GT Global Financial Services
Fund, GT Global Health Care Fund, GT Global Infrastructure Fund, GT Global
Natural Resources Fund and GT Global Telecommunications Fund ("Funds") are
separate series of G.T. Investment Funds, Inc. ("Company"). Collectively, these
Funds are known as the "GT Global Theme Funds". The Company is organized as a
Maryland corporation and is registered under the Investment Company Act of 1940,
as amended ("1940 Act"), as an open-end management investment company. The
Company has twelve series of shares in operation, each series corresponding to a
distinct portfolio of investments.
The GT Global Consumer Products and Services Fund, GT Global Financial Services
Fund, GT Global Infrastructure Fund, and GT Global Natural Resources Fund each
invests substantially all of its investable assets in Global Consumer Products
and Services Portfolio, Global Financial Services Portfolio, Global
Infrastructure Portfolio, and Global Natural Resources Portfolio ("Portfolios"),
respectively. Each of these Portfolios is organized as a subtrust of a New York
common law trust ("Trust") and is registered under the 1940 Act as an open-end
investment management company.
The Portfolios have investment objectives, policies, and limitations
substantially identical to those of their corresponding Funds. Therefore, the
financial statements of the aformentioned Funds and their respective Portfolios
have been presented on a consolidated basis, and represent all activities of
both the respective Funds and Portfolios. Through April 30, 1997, all of the
shares of beneficial interest of each Portfolio were owned by either its
respective Fund or Chancellor LGT Asset Management, Inc. (the "Manager"), which
has a nominal ($100) investment in each Portfolio.
The Funds offer Class A, Class B, and Advisor Class shares, each of which has
equal rights as to assets and voting privileges except that Class A and Class B
each has exclusive voting rights with respect to its distribution plan.
Investment income, realized and unrealized capital gains and losses, and the
common expenses of each Fund are allocated on a pro rata basis to each class
based on the relative net assets of each class to the total net assets of the
Fund. Each class of shares differs in its respective service and distribution
expenses, and may differ in its transfer agent, registration, and certain other
class-specific fees and expenses.
The following is a summary of significant accounting policies consistently
followed by the Funds and Portfolios in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles, and the financial statements may include certain estimates made by
management.
(A) PORTFOLIO VALUATION
The Funds calculate the net asset value of and complete orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or on the principal over-the-counter market on which
such securities are traded, as of the close of business on the day the
securities are being valued, or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by the Manager to be the
primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when the
Manager deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments are valued at
amortized cost adjusted for foreign exchange translation and market fluctuation,
if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Directors or the Trust's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially changed such value,
then the fair value of those securities will be determined by consideration of
other factors by or under the direction of the Company's Board of Directors or
the Trust's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of each Fund and Portfolio are maintained in U.S.
dollars. The market values of foreign securities, currency holdings, and other
assets and liabilities are recorded in the books and records of the Funds or
Portfolios (the phrase "Fund or Portfolio" hereinafter includes the GT Global
Health Care Fund, The GT Global Telecommunications Fund, and the four
Portfolios) after translation to U.S. dollars based on the exchange rates on
that day. The cost of each security is determined using historical exchange
rates. Income and withholding taxes are translated at prevailing exchange rates
when earned or incurred.
A Fund or Portfolio does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss from
investments.
F41
<PAGE>
GT GLOBAL THEME FUNDS
Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, forward foreign currency contracts, sales
of foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's or Portfolio's books and the U.S. dollar equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains or losses arise
from changes in the value of assets and liabilities other than investments in
securities at period end, resulting from changes in exchange rates.
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by a Fund or Portfolio, it is
the Fund's or Portfolio's policy to always receive, as collateral, United States
government securities or other high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be repaid to the
Fund or Portfolio under each agreement at its maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward Contract") is an agreement between
two parties to buy and sell a currency at a set price on a future date. The
market value of the Forward Contract fluctuates with changes in currency
exchange rates. The Forward Contract is marked-to-market daily and the change in
market value is recorded by the Fund or Portfolio as an unrealized gain or loss.
When the Forward Contract is closed, the Fund or Portfolio records a realized
gain or loss equal to the difference between the value at the time it was opened
and the value at the time it was closed. Forward Contracts involve market risk
in excess of the amount shown in the Fund's or Portfolio's "Statement of Assets
and Liabilities". A Fund or Portfolio could be exposed to risk if a counterparty
is unable to meet the terms of the contract or if the value of the currency
changes unfavorably. A Fund or Portfolio may enter into Forward Contracts in
connection with planned purchases or sales of securities, or to hedge against
adverse fluctuations in exchange rates between currencies.
(E) OPTION ACCOUNTING PRINCIPLES
When a Fund or Portfolio writes a call or put option, an amount equal to the
premium received is included in the Fund's or Portfolio's "Statement of Assets
and Liabilities" as an asset and an equivalent liability. The amount of the
liability is subsequently marked-to-market to reflect the current market value
of the option. The current market value of an option listed on a traded exchange
is valued at its last bid price, or, in the case of an over-the-counter option,
is valued at the average of the last bid prices obtained from brokers, unless a
quotation from only one broker is available, in which case only that broker's
price will be used. If an option expires on its stipulated expiration date or if
the Fund or Portfolio enters into a closing purchase transaction, a gain or loss
is realized without regard to any unrealized gain or loss on the underlying
security and the liability related to such option is extinguished. If a written
call option is exercised, a gain or loss is realized from the sale of the
underlying security and the proceeds of the sale are increased by the premium
originally received. If a written put option is exercised, the cost of the
underlying security purchased would be decreased by the premium originally
received. The Fund or Portfolio can write options only on a covered basis,
which, for a call, requires that the Fund or Portfolio hold the underlying
security and, for a put, requires the Fund or Portfolio to set aside cash, U.S.
government securities or other liquid securities in an amount not less than the
exercise price, or otherwise provide adequate cover at all times while the put
option is outstanding. The Fund or Portfolio may use options to manage its
exposure to the stock market and to fluctuations in currency values or interest
rates.
The premium paid by the Fund or Portfolio for the purchase of a call or put
option is included in the Fund's or Portfolio's "Statement of Assets and
Liabilities" as an investment and subsequently "marked-to-market" to reflect the
current market value of the option. If an option which the Fund or Portfolio has
purchased expires on the stipulated expiration date, the Fund or Portfolio
realizes a loss in the amount of the cost of the option. If the Fund or
Portfolio enters into a closing sale transaction, the Fund or Portfolio realizes
a gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund or Portfolio
exercises a call option, the cost of the securities acquired by exercising the
call is increased by the premium paid to buy the call. If the Fund or Portfolio
exercises a put option, it realizes a gain or loss from the sale of the
underlying security, and the proceeds from such sale are decreased by the
premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund or Portfolio may forego
the opportunity of profit if the market value of the underlying security or
index increases and the option is exercised. The risk in writing a put option is
that the Fund or Portfolio may incur a loss if the market value of the
underlying security or index decreases and the option is exercised. In addition,
there is the risk the Fund or Portfolio may not be able to enter into a closing
transaction because of an illiquid secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract a
Fund or Portfolio is required to pledge to the broker an amount of cash or
securities equal to the minimum "initial margin" requirements of the exchange on
which the contract is traded. Pursuant to the contract, the Fund or Portfolio
agrees to receive from or pay to the broker an amount of cash equal to the daily
fluctuation in value of the contract. Such receipts or payments are known as
"variation margin" and are recorded by the Fund or Portfolio as unrealized gains
or losses. When the contract is closed, the Fund or Portfolio records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed. The potential risk
to the Fund or Portfolio is that the change in value of the underlying
securities may not correlate to the change in value of the contracts. A Fund or
F42
<PAGE>
GT GLOBAL THEME FUNDS
Portfolio may use futures contracts to manage its exposure to the stock market
and to fluctuations in currency values or interest rates.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on a first-in,
first-out-basis, unless otherwise specified. Dividends are recorded on the
ex-dividend date. Interest income is recorded on the accrual basis. Where a high
level of uncertainty exists as to its collection, income is recorded net of all
withholding tax with any rebate recorded when received. A Fund or Portfolio may
trade securities on other than normal settlement terms. This may increase the
risk if the other party to the transaction fails to deliver and causes the Fund
or Portfolio to subsequently invest at less advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At April 30, 1997, stocks with an aggregate value listed below were on loan to
brokers. The loans were secured by cash collateral received by the Funds or
Portfolios:
<TABLE>
<CAPTION>
APRIL 30, 1997
--------------------------------------
AGGREGATE VALUE ON
LOAN CASH COLLATERAL
------------------- -----------------
<S> <C> <C>
Global Consumer Products and Services Portfolio................................. $ 6,744,955 $ 7,089,430
Global Financial Services Portfolio............................................. 3,192,898 3,660,429
GT Global Health Care Fund...................................................... 47,366,285 48,736,900
Global Infrastructure Portfolio................................................. 7,405,266 7,673,825
Global Natural Resources Portfolio.............................................. 6,800,288 6,945,000
GT Global Telecommunications Fund............................................... 218,940,949 219,016,373
<CAPTION>
PERIOD ENDED
APRIL 30, 1997
----------------
FEES RECEIVED
----------------
<S> <C>
Global Consumer Products and Services Portfolio................................. $ 67,584
Global Financial Services Portfolio............................................. 4,811
GT Global Health Care Fund...................................................... 33,365
Global Infrastructure Portfolio................................................. 39,734
Global Natural Resources Portfolio.............................................. 20,218
GT Global Telecommunications Fund............................................... 418,540
</TABLE>
For international securities, cash collateral is received by a Fund or Portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by a Fund or Portfolio against loaned securities in the
amount at least equal to 102% of the market value of the loaned securities at
the inception of each loan. This collateral must be maintained at not less than
100% of the market value of the loaned securities during the period of the loan.
Fees received from securities loaned were used to reduce the Funds' or
Portfolios' custodian and other administrative expenses.
(I) TAXES
It is the intended policy of the Funds and Portfolios to meet the requirements
for qualification as a "regulated investment company" under the Internal Revenue
Code of 1986, as amended ("Code"). It is also the intention of the Funds to make
distributions sufficient to avoid imposition of any excise tax under Section
4982 of the Code. Therefore, no provision has been made for Federal taxes on
income, capital gains, unrealized appreciation of securities held, or exise tax
on income and capital gains.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by each Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Funds or Portfolios and timing
differences.
(K) DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the GT Global Consumer Products and Services Fund, GT
Global Financial Services Fund, GT Global Infrastructure Fund, and GT Global
Natural Resources Fund in connection with their organizations, their initial
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $51,500, $63,100,
$51,500, and $51,500, respectively. These expenses are being amortized on a
straightline basis over a five-year period.
(L) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent in
investments of domestic origin. The Fund's or Portfolio's investment in emerging
market countries may involve greater risks than investments in more developed
markets and the price of such investments may be volatile. These risks of
investing in foreign and emerging markets may include foreign currency exchange
rate fluctuations, perceived credit risk, adverse political and economic
developments and possible adverse foreign government intervention.
In addition, each Fund or Portfolio may focus its investments in certain related
consumer products and services, financial services, health care, infrastructure,
natural resources, or telecommunications industries, subjecting the Fund or
Portfolio to greater risk than a fund that is more diversified.
(M) INDEXED SECURITIES
A Fund or Portfolio may invest in indexed securities whose value is linked
either directly or indirectly to changes in foreign currencies, interest rates,
equities, indices, or other reference instruments. Indexed securities may be
more volatile than the reference instrument itself, but any loss is limited to
the amount of the original investment.
(N) RESTRICTED SECURITIES
A Fund or Portfolio is permitted to invest in privately placed restricted
securities. These securities may be resold in transactions exempt from
registration or to the public if the securities are registered.
F43
<PAGE>
GT GLOBAL THEME FUNDS
Disposal of these securities may involve time-consuming negotiations and
expense, and prompt sale at an acceptable price may be difficult. At the end of
the period, restricted securities (excluding 144A issues) are shown at the end
of the Fund's or Portfolio's Portfolio of Investments.
(O) LINE OF CREDIT
Each of the Funds, along with certain other funds advised by the Manager, has a
line of credit with the Bank of Boston. The arrangement with the bank allows all
specified funds to borrow an aggregate maximum amount of $100,000,000. Each of
these six funds is limited to borrowing up to 33 1/3% of the value of each
Fund's total assets. On April 30, 1997, the Funds had no borrowings outstanding.
For the six months ended April 30, 1997, the average outstanding daily balance
of bank loans (based on the number of days the loans were outstanding) for the
GT Global Health Care Fund, GT Global Natural Resources Fund and GT Global
Telecommunications Fund was $5,133,333, $4,600,000, $31,620,690, respectively.
The average interest rate for the GT Global Health Care Fund, GT Global Natural
Resources Fund and GT Global Telecommunications Fund was 6.70%, 6.55% and 6.35%,
respectively. Interest incurred on these funds for the period ended April 30,
1997 for the GT Global Health Care Fund, GT Global Natural Resources Fund, and
GT Global Telecommunications Fund was $21,656, $17,363, and $482,532,
respectively. Interest incurred is included in "Other Expenses" on the Statement
of Operations.
2. RELATED PARTIES
Chancellor LGT Asset Management, Inc. is the Funds' and Portfolios' investment
manager and administrator. GT Global Consumer Products and Services Fund, GT
Global Financial Services Fund, GT Global Infrastructure Fund, and GT Global
Natural Resources Fund each pays the Manager administration fees at the
annualized rate of 0.25% of such Fund's average daily net assets. Each of the
Portfolios pays investment management and administration fees to the Manager at
the annualized rate of 0.725% on the first $500 million of average daily net
assets of the Portfolio; 0.70% on the next $500 million; 0.675% on the next $500
million; and 0.65% on amounts thereafter. GT Global Health Care Fund and GT
Global Telecommunications Fund each pays investment management and
administration fees to the Manager at the annualized rate of 0.975% on the first
$500 million of average daily net assets of the Fund; 0.95% on the next $500
million; 0.925% on the next $500 million and 0.90% on amounts thereafter. These
fees are computed daily and paid monthly.
GT Global, Inc. ("GT Global"), an affiliate of the Manager, serves as the Funds'
distributor. The Funds offer Class A, Class B, and Advisor Class shares for
purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the shedule included in the Funds' current
prospectus. GT Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended April 30, 1997, GT Global retained the
following sales charges: $72,857 for the GT Global Consumer Products and
Services Fund, $9,977 for the GT Global Financial Services Fund, $36,269 for the
GT Global Health Care Fund, $15,887 for the GT Global Infrastructure Fund,
$50,465 for the GT Global Natural Resources Fund, and $80,333 for the GT Global
Telecommunications Fund. Purchases of Class A shares exceeding $500,000 may be
subject to a contingent deferred sales charge ("CDSC") upon redemption, in
accordance with the Funds' current prospectus. GT Global collected CDSCs for the
period ended April 30, 1997, as follows: $5,032 for the GT Global Consumer
Products and Services Fund, $0 for the GT Global Financial Services Fund,
$24,629 for the GT Global Health Care Fund, $115 for the GT Global
Infrastructure Fund, $1,774 for the GT Global Natural Resources Fund, and
$23,183 for the GT Global Telecommunications Fund. GT Global also makes ongoing
shareholder servicing and trail commission payments to dealers whose clients
hold Class A shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, GT Global, from its own resources, pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to CDSCs, in accordance with the Funds' current
prospectus. For the period ended April 30, 1997, GT Global collected CDSCs in
the amount of: $168,551 for the GT Global Consumer Products and Services Fund,
$26,428 for the GT Global Financial Services Fund, $205,709 for the GT Global
Health Care Fund, $109,256 for the GT Global Infrastructure Fund, $140,247 for
the GT Global Natural Resources Fund, and $4,327,630 for the GT Global
Telecommunications Fund. In addition, GT Global makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class B
shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate distribution plans with respect to the Funds' Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which a Fund
reimburses GT Global for a portion of its shareholder servicing and
distributions expenses. Under the Class A Plan, a Fund may pay GT Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for GT Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay GT Global a
distribution fee at the annualized rate of up to 0.50% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for GT Global's expenditures incurred in providing
services as distributor. All expenses for which GT Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.
Pursuant to the Class B Plan, a Fund may pay GT Global a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class B shares for GT Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay GT Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for GT Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be
F44
<PAGE>
GT GLOBAL THEME FUNDS
carried forward for reimbursement in subsequent years as long as that Plan
continues in effect.
The Manager and GT Global voluntarily have undertaken to limit each Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expense) to the maximum annual rate of 2.40%, 2.90%, and 1.90% of the average
daily net assets of the Fund's Class A, Class B, and Advisor Class shares,
respectively. If necessary, this limitation will be effected by waivers by the
Manager of investment management fees, waivers by GT Global of payments under
the Class A Plan and/or Class B Plan and/or reimbursements by the Manager or GT
Global of portions of the Fund's other operating expenses.
GT Global Investor Services, Inc. ("GT Services"), an affiliate of the Manager
and GT Global, is the transfer agent of the Funds. For performing shareholder
servicing, reporting, and general transfer agent services, GT Services receives
an annual maintenance fee of $17.50 per account, a new account fee of $4.00 per
account, a per transaction fee of $1.75 for all transactions other than
exchanges and a per exchange fee of $2.25. GT Services also is reimbursed by the
Funds for its out-of-pocket expenses for such items as postage, forms, telephone
charges, stationery and office supplies.
The Manager is the pricing and accounting agent for the Funds and Portfolios.
The monthly fee for these services to the Manager is a percentage, not to exceed
0.03% annually, of a Fund or Portfolio's average daily net assets. The annual
fee rate is derived by applying 0.03% to the first $5 billion of assets of all
registered mutual funds advised by the Manager and 0.02% to the assets in excess
of $5 billion and allocating the result according to each Fund's average daily
net assets.
The Company pays each Director who is not an employee, officer or director of
the Manager, or any other affiliated company $5,000 per year plus $300 for each
meeting of the board or any committee thereof attended by the Director. Each
Portfolio pays each of its Trustees who is not an employee, officer, or director
of the Manager, GT Global or GT Services $500 per year plus $150 for each
meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
The following summarizes purchases and sales of investment securities, other
than short-term investments, by each Fund or Portfolio for the period ended
April 30, 1997:
PURCHASES AND SALES OF SECURITIES
<TABLE>
<CAPTION>
PURCHASES
------------------------------
PORTFOLIO U.S. GOVERNMENT OTHER ISSUES
- -------------------------------------------------------------------------------- --------------- ------------
<S> <C> <C>
Global Consumer Products and Services Portfolio................................. $ -- $338,175,502
Global Financial Services Portfolio............................................. -- 38,457,045
GT Global Health Care Fund...................................................... -- 570,617,772
Global Infrastructure Portfolio................................................. -- 24,309,653
Global Natural Resources Portfolio.............................................. -- 230,282,609
GT Global Telecommunications Fund............................................... -- 251,954,774
</TABLE>
<TABLE>
<CAPTION>
SALES
------------------------------
PORTFOLIO U.S. GOVERNMENT OTHER ISSUES
- -------------------------------------------------------------------------------- --------------- ------------
<S> <C> <C>
Global Consumer Products and Services Portfolio $ -- $355,175,171
Global Financial Services Portfolio............................................. -- 17,026,640
GT Global Health Care Fund...................................................... -- 570,509,130
Global Infrastructure Portfolio................................................. -- 22,440,471
Global Natural Resources Portfolio.............................................. -- 229,369,514
GT Global Telecommunications Fund............................................... -- 810,448,761
</TABLE>
F45
<PAGE>
GT GLOBAL THEME FUNDS
4. CAPITAL SHARES
At April 30, 1997, there were 6,000,000,000 shares of the Company's common stock
authorized, at $0.0001 par value. Of this amount, 400,000,000 were classified as
shares of the GT Global Telecommunications Fund; 400,000,000 were classified as
shares of GT Global Government Income Fund; 200,000,000 were classified as
shares of GT Global Health Care Fund; 200,000,000 were classified as shares of
GT Global Strategic Income Fund; 200,000,000 were classified as shares of GT
Global Currency Fund (inactive); 200,000,000 were classified as shares of GT
Global Growth & Income Fund; 200,000,000 were classified as shares of GT Global
Small Companies Fund (inactive); 200,000,000 were classified as shares of GT
Global Latin America Growth Fund; 200,000,000 were classified as shares of GT
Global Emerging Markets Fund; 200,000,000 were classified as shares of GT Global
High Income Fund; 200,000,000 were classified as shares of GT Global Financial
Services Fund; 200,000,000 were classified as shares of GT Global Natural
Resources Fund; 200,000,000 were classified as shares of GT Global
Infrastructure Fund; 200,000,000 were classified as shares of GT Global Consumer
Products and Services Fund. The shares of each of the foregoing series of the
Company were divided equally into two classes, designated Class A and Class B
common stock. With respect to the issuance of Advisor Class shares, 100,000,000
shares were classified as shares of each of the fourteen series of the Company
and designated as Advisor Class common stock. 1,400,000,000 shares remain
unclassified. Transactions in capital shares of the Fund were as follows:
CAPITAL SHARE TRANSACTIONS
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
Shares sold....................................... 2,301,518 $ 46,051,606 6,142,401 $ 118,779,939
<S> <C> <C> <C> <C>
Shares issued in connection with reinvestment of
distributions................................... 143,289 2,884,396 13,656 202,166
----------- ------------- ----------- ---------------
2,444,807 48,936,002 6,156,057 118,982,105
Shares repurchased................................ (2,602,839) (51,085,708) (2,769,898) (54,486,898)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (158,032) $ (2,149,706) 3,386,159 $ 64,495,207
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 2,307,381 $ 45,368,710 5,689,956 $ 110,105,123
Shares issued in connection with reinvestment of
distributions................................... 168,823 3,364,852 10,957 161,052
----------- ------------- ----------- ---------------
2,476,204 48,733,562 5,700,913 110,266,175
Shares repurchased................................ (1,686,839) (32,725,986) (1,675,446) (32,960,366)
----------- ------------- ----------- ---------------
Net increase...................................... 789,365 $ 16,007,576 4,025,467 $ 77,305,809
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 27,044 $ 549,720 589,226 $ 12,396,492
Shares issued in connection with reinvestment of
distributions................................... 15,186 308,573 402 5,969
----------- ------------- ----------- ---------------
42,230 858,293 589,628 12,402,461
Shares repurchased................................ (345,676) (6,864,129) (248,775) (5,293,607)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (303,446) $ (6,005,836) 340,853 $ 7,108,854
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F46
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL FINANCIAL SERVICES FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 1,924,559 $ 28,499,942 900,372 $ 11,973,497
Shares issued in connection with reinvestment of
distributions................................... 35,123 488,569 3,997 50,562
----------- ------------- ----------- ---------------
1,959,682 28,988,511 904,369 12,024,059
Shares repurchased................................ (1,090,762) (15,968,414) (867,261) (11,494,650)
----------- ------------- ----------- ---------------
Net increase...................................... 868,920 $ 13,020,097 37,108 $ 529,409
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 1,773,182 $ 25,991,765 596,980 $ 7,792,181
Shares issued in connection with reinvestment of
distributions................................... 44,922 618,567 2,898 36,456
----------- ------------- ----------- ---------------
1,818,104 26,610,332 599,878 7,828,637
Shares repurchased................................ (818,126) (11,906,986) (281,339) (3,677,982)
----------- ------------- ----------- ---------------
Net increase...................................... 999,978 $ 14,703,346 318,539 $ 4,150,655
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 6,898 $ 103,743 3,500 $ 47,698
Shares issued in connection with reinvestment of
distributions................................... 359 5,018 35 420
----------- ------------- ----------- ---------------
7,257 108,761 3,535 48,118
Shares repurchased................................ (903) (12,914) (1,103) (14,704)
----------- ------------- ----------- ---------------
Net increase...................................... 6,354 $ 95,847 2,432 $ 33,414
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F47
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL HEALTH CARE FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 24,616,401 $ 586,952,015 84,410,204 $ 1,903,687,570
Shares issued in connection with reinvestment of
distributions................................... 1,208,835 27,043,712 2,009,491 41,475,881
----------- ------------- ----------- ---------------
25,825,236 613,995,727 86,419,695 1,945,163,451
Shares repurchased................................ (27,187,659) (649,629,287) (86,124,175) (1,957,478,015)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (1,362,423) $ (35,633,560) 295,520 $ (12,314,564)
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 3,494,659 $ 81,647,690 6,741,207 $ 157,453,975
Shares issued in connection with reinvestment of
distributions................................... 321,675 7,044,819 411,416 8,363,880
----------- ------------- ----------- ---------------
3,816,334 88,692,509 7,152,623 165,817,855
Shares repurchased................................ (2,931,330) (68,252,387) (5,784,194) (129,761,569)
----------- ------------- ----------- ---------------
Net increase...................................... 885,004 $ 20,440,122 1,368,429 $ 36,056,286
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold 759,036 $ 18,339,807 1,142,479 $ 27,246,793
Shares issued in connection with reinvestment of
distributions................................... 2,543 57,375 3,280 67,679
----------- ------------- ----------- ---------------
761,579 18,397,182 1,145,759 27,314,472
Shares repurchased................................ (764,510) (18,619,489) (1,121,971) (26,090,499)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (2,931) $ (222,307) 23,788 $ 1,223,973
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F48
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL INFRASTRUCTURE FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 1,011,798 $ 14,998,494 2,175,475 $ 30,275,819
Shares issued in connection with reinvestment of
distributions................................... 123,821 1,776,824 -- --
----------- ------------- ----------- ---------------
1,135,619 16,775,318 2,175,475 30,275,819
Shares repurchased................................ (850,210) (12,597,467) (2,503,715) (33,964,432)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... 285,409 $ 4,177,851 (328,240) $ (3,688,613)
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 941,020 $ 13,815,298 903,064 $ 12,423,925
Shares issued in connection with reinvestment of
distributions................................... 164,938 2,337,177 -- --
----------- ------------- ----------- ---------------
1,105,958 16,152,475 903,064 12,423,925
Shares repurchased................................ (622,408) (9,123,726) (1,306,101) (17,421,173)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... 483,550 $ 7,028,749 (403,037) $ (4,997,248)
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 9,679 $ 147,303 11,122 $ 154,109
Shares issued in connection with reinvestment of
distributions................................... 1,147 16,592 -- --
----------- ------------- ----------- ---------------
10,826 163,895 11,122 154,109
Shares repurchased................................ (3,383) (50,220) (5,256) (70,861)
----------- ------------- ----------- ---------------
Net increase...................................... 7,443 $ 113,675 5,866 $ 83,248
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F49
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL NATURAL RESOURCES FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 7,136,603 $ 123,456,154 9,220,103 $ 142,385,816
Shares issued in connection with reinvestment of
distributions................................... 97,442 1,672,106 3,977 47,892
----------- ------------- ----------- ---------------
7,234,045 125,128,260 9,224,080 142,433,708
Shares repurchased................................ (6,774,312) (115,510,789) (7,529,884) (116,812,100)
----------- ------------- ----------- ---------------
Net increase...................................... 459,733 $ 9,617,471 1,694,196 $ 25,621,608
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 3,630,738 $ 62,153,740 4,288,540 $ 66,460,658
Shares issued in connection with reinvestment of
distributions................................... 120,160 2,042,705 709 8,495
----------- ------------- ----------- ---------------
3,750,898 64,196,445 4,289,249 66,469,153
Shares repurchased................................ (2,621,971) (43,132,621) (2,178,862) (33,276,553)
----------- ------------- ----------- ---------------
Net increase...................................... 1,128,927 $ 21,063,824 2,110,387 $ 33,192,600
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 210,412 $ 3,771,344 663,037 $ 10,703,010
Shares issued in connection with reinvestment of
distributions................................... 7,576 130,389 77 922
----------- ------------- ----------- ---------------
217,988 3,901,733 663,114 10,703,932
Shares repurchased................................ (400,505) (6,724,257) (356,384) (5,379,503)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (182,517) $ (2,822,524) 306,730 $ 5,324,429
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F50
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL TELECOMMUNICATIONS FUND
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 67,026,667 $1,088,083,918 161,134,594 $ 2,777,197,821
Shares issued in connection with reinvestment of
distributions................................... 4,872,576 77,134,821 3,376,395 52,886,360
----------- ------------- ----------- ---------------
71,899,243 1,165,218,739 164,510,989 2,830,084,181
Shares repurchased................................ (85,762,706) (1,391,051,518) (174,818,005) (3,017,740,549)
----------- ------------- ----------- ---------------
Net decrease...................................... (13,863,463) $(225,832,779) (10,307,016) $ (187,656,368)
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 6,117,519 $ 94,583,067 15,365,874 $ 260,167,785
Shares issued in connection with reinvestment of
distributions................................... 4,413,791 68,371,247 2,882,770 44,452,585
----------- ------------- ----------- ---------------
10,531,310 162,954,314 18,248,644 304,620,370
Shares repurchased................................ (19,499,579) (302,952,848) (25,319,583) (426,829,324)
----------- ------------- ----------- ---------------
Net decrease...................................... (8,968,269) $(139,998,534) (7,070,939) $ (122,208,954)
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1997 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1996
-------------------------- ----------------------------
ADVISOR CLASS SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------- ----------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
Shares sold....................................... 759,531 $ 12,347,124 1,229,487 $ 21,592,338
Shares issued in connection with reinvestment of
distributions................................... 11,071 176,806 2,119 33,270
----------- ------------- ----------- ---------------
770,602 12,523,930 1,231,606 21,625,608
Shares repurchased................................ (771,810) (12,551,219) (1,216,785) (21,450,446)
----------- ------------- ----------- ---------------
Net increase (decrease)........................... (1,208) $ (27,289) 14,821 $ 175,162
----------- ------------- ----------- ---------------
----------- ------------- ----------- ---------------
</TABLE>
F51
<PAGE>
GT GLOBAL THEME FUNDS
5. EXPENSE REDUCTIONS
The Manager has directed certain portfolio trades to brokers who paid a portion
of a Fund's or Portfolio's expenses. For the period ended April 30, 1997, the
Funds' or Portfolios' expenses were reduced by the following amounts under these
arrangements:
<TABLE>
<CAPTION>
EXPENSE
REDUCTION
---------
<S> <C>
Global Consumer Products and Services Portfolio.......................................................................... $ 32,382
Global Financial Services Portfolio...................................................................................... 2,834
GT Global Health Care Fund............................................................................................... 41,212
Global Infrastructure Portfolio.......................................................................................... --
Global Natural Resources Portfolio....................................................................................... 31,498
GT Global Telecommunications Fund........................................................................................ 52,399
</TABLE>
6. HOLDINGS OF 5% VOTING SECURITIES OF PORTFOLIO COMPANIES
Investments of 5% or more of an issuer's outstanding voting securities by a Fund
or Portfolio are defined in the Investment Company Act of 1940 as an affiliated
company. Investments in affiliated companies by GT Global Health Care Fund,
Global Natural Resources Portfolio and GT Global Telecommunications Fund at
April 30, 1997 amounted to $192,621,692, $383,862 and $127,484,175,
respectively, at value.
Transactions with affiliated companies are as follows:
GT GLOBAL HEALTH CARE FUND:
<TABLE>
<CAPTION>
NET REALIZED DIVIDEND
PURCHASES COST SALES COST GAIN (LOSS) INCOME
--------------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Advanced Technology Laboratories, Inc............. $ 21,921,545 $ 333,906 $ (51,815) $ --
AVECOR Cardiovascular, Inc........................ 453,513 -- -- --
Catalytica, Inc................................... 10,586,769 -- -- --
Circon Corp....................................... -- -- -- --
Depotech Corp..................................... 12,202,500 3,116,425 675,055 --
Endosonics Corp................................... 15,065,418 -- -- --
INAMED Corp....................................... 3,034,532 198,750 (108,753) --
Interferon Sciences, Inc.......................... 5,870,743 -- -- --
Kensey Nash Corp.................................. 5,061,042 368,230 11,757 --
Life Medical Sciences, Inc........................ 2,096,301 795,000 (352,500) --
Micro Therapeutics, Inc........................... 1,800,000 60,000 6,248 --
Photoelectron Corp................................ 2,822,805 -- -- --
Protein Design Labs, Inc.......................... 8,847,756 4,859,893 5,244,537 --
Regeneron Pharmaceuticals, Inc.................... 13,909,185 1,766,702 277,107 --
Sunrise Medical Inc............................... 3,251,246 -- -- --
TheraTech, Inc.................................... 7,469,973 -- -- --
Visx, Inc......................................... 8,902,482 3,034,012 (18,904) --
</TABLE>
GLOBAL NATURAL RESOURCES PORTFOLIO:
<TABLE>
<CAPTION>
PURCHASES NET REALIZED DIVIDEND
COST SALES COST GAIN (LOSS) INCOME
------------ -------------- --------------- ------------
<S> <C> <C> <C> <C>
Asquith Resources Inc............................. $ -- $ -- $ -- $ --
</TABLE>
GT GLOBAL TELECOMMUNICATIONS FUND:
<TABLE>
<CAPTION>
PURCHASES NET REALIZED DIVIDEND
COST SALES COST GAIN (LOSS) INCOME
------------ -------------- --------------- ------------
<S> <C> <C> <C> <C>
Echostar Communications Corp. - CL A.............. $ -- $ -- $ -- $ --
Himachal Futuristic Communications Ltd. - 144A
GDR............................................. -- -- -- --
International Engineering PLC..................... -- 243,529 (604,421) --
Millicom International Cellular S.A............... -- -- -- --
Orbital Sciences Corp............................. -- 1,793,690 450,878 --
Tekelec........................................... 430,000 2,209,367 845,276 --
Three-Five Systems, Inc........................... -- 1,862,340 (1,738,353) --
</TABLE>
F52
<PAGE>
GT GLOBAL THEME FUNDS
NOTES
- --------------------------------------------------------------------------------
<PAGE>
GT GLOBAL THEME FUNDS
GT GLOBAL FUNDS
GT GLOBAL OFFERS A BROAD RANGE OF FUNDS TO COMPLEMENT MANY INVESTORS'
PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE GT GLOBAL
FUNDS, PLEASE CONTACT YOUR INVESTMENT ADVISOR OR CALL GT GLOBAL DIRECTLY AT
1-800-824-1580. THE PROSPECTUS CONTAINS MORE COMPLETE INFORMATION, INCLUDING
CHARGES, EXPENSES AND THE RISKS OF GLOBAL AND EMERGING MARKET INVESTING.
INVESTORS SHOULD READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
GROWTH FUNDS
GLOBALLY DIVERSIFIED FUNDS
GT GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.
GT GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside the U.S.
GT GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies
GLOBAL THEME FUNDS
GT GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Focuses on worldwide opportunities from the demand for consumer products and
services
GT GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide
GT GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products
GT GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain infrastructure
GT GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources
GT GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment
REGIONALLY DIVERSIFIED FUNDS
GT GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan
GT GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe
GT GLOBAL LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America
SINGLE COUNTRY FUNDS
GT GLOBAL AMERICA SMALL CAP GROWTH FUND
Invests in equity securities of small U.S. companies
GT GLOBAL AMERICA MID CAP GROWTH FUND
Concentrates on medium-sized companies in the U.S.
GT GLOBAL AMERICA VALUE FUND
Concentrates on equity securities of large cap U.S. companies believed to be
undervalued
GT GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market
GROWTH AND INCOME FUND
GT GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government securities
INCOME FUNDS
GT GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities
GT GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets
GT GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets
GT GLOBAL FLOATING RATE FUND
Invests primarily in senior secured floating rate loans that have the potential
to achieve a high level of current income
MONEY MARKET FUND
GT GLOBAL DOLLAR FUND
Invests in high-quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital
This report must be accompanied or preceded by a current prospectus.
<PAGE>
[LOGO]
GT Global, Inc.
Fifty California Street
27th Floor
San Francisco, CA
94111-4624
DATED MATERIAL
PLEASE EXPEDITE
THESAR706396JR.326
June, 1997
