<PAGE> 1
ANNUAL REPORT / OCTOBER 31 1999
AIM LATIN AMERICAN GROWTH FUND
[COVER IMAGE}
[AIM LOGO APPEARS HERE]
<PAGE> 2
[COVER IMAGE}
-------------------------------------
CREAM PITCHER, RED APPLES BY ELSIE BUNGE
LATIN AMERICA, WITH ITS ABUNDANT RESOURCES, GROWING CONSUMER POPULATION AND
EXPANDING INDUSTRY, PRESENTS POTENTIALLY ATTRACTIVE INVESTMENT OPPORTUNITIES. WE
BELIEVE ARGENTINE ARTIST ELSIE BUNGE'S BRIGHTLY COLORED PAINTING CAPTURES BOTH
THE SPIRIT AND EXCITING POTENTIAL OF LATIN AMERICA.
-------------------------------------
AIM Latin American Growth Fund is for shareholders who seek long-term growth of
capital. The fund primarily invests in securities of a broad range of Latin
American issuers.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Latin American Growth Fund's performance figures are historical and
reflect reinvestment of all distributions and changes in net asset value.
o Had fees and expenses not been waived during the fiscal year, returns would
have been lower.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 4.75% sales charge, and Class B and Class C
share performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the fund's Class B, Class C and Advisor Class shares will
differ from that of Class A shares due to differences in sales charge
structure and fund expenses.
o The fund's average annual total returns (including sales charges) as of
9/30/99 (the most recent calendar quarter end), are as follows: for Class A
shares, one year, 23.87%; five years, -11.89%; inception (8/13/91), 1.24%.
For Class B shares, one year, 24.31%; five years -11.78%; inception
(9/1/93), -1.46%. For Class C shares, inception (3/1/99), 32.20%. For
Advisor Class shares, one year, 30.66%; inception (6/1/95), -2.52%.
o Because Class C shares have been offered for less than one year, total
return provided has not been annualized.
o Sales charges do not apply to Advisor Class shares. Advisor Class shares
were closed to new investors as of 3/1/99.
o During the fiscal year ended 10/31/99, Class A shares paid distributions of
$0.1425 per share, Class B shares paid $0.0320 per share and Advisor Class
shares paid $0.2265 per share.
o International investing presents certain risks not associated with investing
solely in the United States. These include risks relating to fluctuations in
the value of the U.S. dollar relative to the values of other currencies, the
custodial arrangements made for the fund's foreign holdings, differences in
accounting, political risks and the lesser degree of public information
required to be provided by non-U.S. companies.
o The fund's investment return and principal value will fluctuate, so an
investor's shares, when redeemed, may be worth more or less than their
original cost.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The unmanaged MSCI Emerging Latin America Index is a group of securities
from emerging Latin American markets tracked by Morgan Stanley Capital
International.
o An investment cannot be made in any index listed. Unless otherwise
indicated, index results include reinvested dividends and do not reflect
sales charges.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF A BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORP. OR ANY OTHER GOVERNMENT
AGENCY. THERE IS A RISK THAT YOU COULD LOSE SOME OR ALL OF YOUR MONEY.
This report may be distributed only to current shareholders or to persons who
have received a current prospectus of the fund.
AIM LATIN AMERICAN GROWTH FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
The fiscal year discussed in this report reconfirmed our
[PHOTO OF faith in two long-established principles of investing:
CHARLES T. portfolio diversification and long-term thinking. We could
BAUER, title this report "What a Difference a Year Makes."
CHAIRMAN OF An investor surveying conditions when the fiscal year
THE BOARD OF opened on October 31, 1998, saw a market dominated by
THE FUND large-capitalization stocks and high-quality bonds,
APPEARS HERE] especially U.S. Treasuries. Ten months into 1998, two
well-known indexes of large-capitalization U.S. company
stocks, the S&P 500 and the Dow Jones Industrial Average,
were up by double digits, but the smaller-company stocks in
the Russell 2000 had lost 12.80%. Overseas, many markets
were languishing, especially in Asia, where many financial
difficulties originated in 1997.
In bond markets also, name-brand quality was the place
to be. The Lehman Corporate/Government Bond Index, which follows intermediate
and long-term government and investment-grade debt, was up 8.56%, while the
Lehman High Yield Index, which tracks riskier "junk bonds," had dropped 2.30%.
It would be easy for an investor to conclude that blue chips, whether
equity or fixed-income, were the only place to be. That investor, of course,
would be wrong.
MARKETS TURN
While large-capitalization stocks continue to do very well, during 1999 markets
broadened considerably, with many investment sectors performing a complete
turnaround. Year to date by October 31, 1999, the small-cap stocks in the
Russell 2000 were back in positive territory, and the many Asian markets had
staged a comeback. The same holds true for bonds. The higher-quality Lehman
index is down 1.49% year to date through October 31, 1999, while high-yield
bonds have moved into positive returns.
The point, at the risk of sounding repetitive to those of you who have
invested with us for a long time, is that this is why diversification is a
fundamental investing principle. Market sectors and asset classes go in and out
of favor, but over the long run--and the long run is several years--the markets'
overall trend has been upward. Selecting an asset class or a market sector on
the basis of a short-term snapshot of conditions is usually unwise, as is
concentrating your portfolio in one asset class. Staying fully invested in a
diversified portfolio remains a compelling strategy and one of your best
prospects for long-term gain.
LOOKING AHEAD
As we look about at the close of this fiscal year, we are encouraged by signs of
economic health in Europe and Asia, not to mention the prolonged U.S. economic
expansion. However, we are aware of how easily an investor could have been
misled by conditions just 12 months ago. For our shareholders, we therefore
reiterate our commitment to investing through a financial advisor. In addition
to helping you select investments appropriate to your time horizon and risk
tolerance, a financial advisor can keep you informed about how changing market
conditions affect you and your portfolio and can help assure that when you do
alter your investments, there's a logical reason for doing so. AIM believes
every investor should be guided by a financial professional.
FUND MANAGERS COMMENT
In the pages that follow, your fund's portfolio managers discuss how they
managed your fund during the year ended October 31, 1999, how the markets
behaved and what they foresee for the near future. We trust you will find their
discussion informative. If you have any questions or comments, we invite you to
contact us, either at our Web site, aimfunds.com, or through our Client Services
department at 800-959-4246. Information about your account is also available
through our automated AIM Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of Funds
- --Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
-------------------------------------
STAYING FULLY
INVESTED IN A DIVERSIFIED PORTFOLIO REMAINS
A COMPELLING STRATEGY AND ONE OF YOUR
BEST PROSPECTS FOR LONG-TERM GAIN.
-------------------------------------
AIM LATIN AMERICAN GROWTH FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
FUND EMERGES WITH IMPROVED PERFORMANCE
HOW HAS AIM LATIN AMERICAN GROWTH FUND PERFORMED OVER THE PAST FISCAL YEAR?
Latin American markets recovered nicely from last year's extreme emerging-market
volatility, and the fund's performance improved significantly during the last
year. Class A shares posted a 20.92% return, Class B shares 20.36% and Advisor
Class shares 21.56% for the period ended October 31, 1999. Class C shares showed
a 35.06% cumulative return since their inception on March 1, 1999. These figures
are at net asset value, meaning they exclude sales charges. By comparison, the
fund's benchmark, the MSCI Emerging Latin America Index, returned 24.71% during
the same period.
WHAT MARKET FACTORS CONTRIBUTED TO THE FUND'S STRONGER PERFORMANCE?
Latin American markets stabilized over the reporting period in the wake of last
year's Russian and Asian crises, and Brazil's devaluation in January 1999. The
fiscal year also saw a modest recovery of share prices, which benefited the
fund. More recently, signs of recovery from recession for markets in Argentina,
Brazil and Chile, as well as a more positive trend for both pricing and demand
in many commodities, have improved the region's outlook. Improving Asian and
European economies are raising commodity prices as supply and demand come back
into balance after the Asian contagion.
DID THE LATIN AMERICAN MARKET SUSTAIN ITS RALLY DURING THE REPORTING PERIOD?
The rally ended in mid-May when inflationary concerns in the United States led
markets to expect a rise in interest rates. Markets subsequently lost ground,
anticipating a new trend in U.S. Federal Reserve (Fed) tightening. Between May
and August, the Latin markets gave up much of their 1999 rally as both U.S.
equity and bond markets came under fire amid concerns of further Fed tightening
and the risk of a U.S. market correction. However, the reporting period closed
with the Latin American market outperforming the U.S. equity market, reflecting
improving regional fundamentals and the lower valuations compared to developed
markets.
LATIN AMERICA
The map below identifies Latin American countries mentioned in this report.
The top five countries in which the fund was invested as of 10/31/99 appear in
blue.
Mexico
Panama
Venezuela
Brazil
Colombia
Peru
Chile
Argentina
TOP 5 COUNTRIES
1. Brazil 35.74%
2. Mexico 35.62
3. Argentina 11.90
4. Chile 7.50
5. Peru 2.80
HOW HAVE YOU MANAGED THE FUND AGAINST THIS BACKDROP?
Our investment strategy remained essentially unchanged. First, we used a
top-down analysis to target country allocations based on political, monetary and
economic factors. Then we conducted a more detailed, industry-by-industry
economic analysis on the countries and adjusted our sector allocations. Finally,
we identified stocks demonstrating earnings growth at a reasonable price,
adjusting the top-down country allocation to suit the availability of securities
in a particular country or sector.
HAVE YOU MADE ANY NOTICEABLE SHIFTS IN COUNTRY ALLOCATION?
Changes in country allocation have been minimal. We shifted the Peruvian and
Venezuelan weightings slightly throughout the fiscal year, and we've become more
aggressive in Brazil vs. Mexico--our two largest country allocations. About
three months ago we reduced our Mexican weightings because of political concerns
in advance of primary elections, which have now taken place. Lastly, we reduced
our weighting in Chile to underweight the fund's benchmark and more closely
resemble the peer group.
WOULD YOU DISCUSS THE DECISION MAKING BEHIND A FEW OF THE FUND'S TOP HOLDINGS?
Petroleo Brasileiro S.A., or Petrobras, the state-owned Brazilian oil company,
was the fund's top holding at the end of the period. More than just an oil
stock, Petrobras is a company whose future is tied to the Brazilian government's
efforts to commercialize old state enterprises. So from a valuation comparison
with international oil stocks, its assets appear to produce poor returns,
indicating it may be undervalued. We hold this stock
See important fund and index disclosures inside front cover.
AIM LATIN AMERICAN GROWTH FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
PORTFOLIO COMPOSITION
As of 10/31/99, based on total net assets
TOTAL NUMBER OF HOLDINGS: 88
<TABLE>
<CAPTION>
===================================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 INDUSTRIES
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Petroleo Brasileiro S.A. (Petrobras) Pfd. (Brazil) 5.55% 1. Telephone 13.84%
2. Grupo Televisa S.A.--GDR (Mexico) 5.05 2. Banks (Regional) 7.61
3. Carso Global Telecom--Class A1 (Mexico) 4.12 3. Electric Companies 7.56
4. Nortel Inversora S.A.--ADR (Argentina) 3.42 4. Beverages (Alcoholic) 6.59
5. Companhia Vale do Rio Doce--Pfd. A (Brazil) 3.17 5. Financial (Diversified) 6.20
6. Fomento Economico Mexicano S.A. 2.96 6. Manufacturing (Diversified) 5.58
de C.V.--ADR (Mexico) 7. Oil & Gas (Exploration & Production) 5.55
7. Grupo Carso S.A. de C.V. Series A1 (Mexico) 2.88 8. Construction (Cement & Aggregates) 5.18
8. Itausa-Investimentos Itau S.A. Pfd. (Brazil) 2.66 9. Entertainment 5.05
9. Telecomunicacoes Brasileiras C.M. (Brazil) 2.44 10. Iron & Steel 4.57
10. Kimberly-Clark de Mexico S.A. 2.16
de C.V.--Class A (Mexico)
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
===================================================================================================================================
</TABLE>
because we see a process going on within Petrobras making the company much more
commercial, focusing on returns on these undervalued assets. So as well as being
positively affected by rising oil prices, it is clearly a good restructuring
story.
Mexico's Grupo Televisa S.A. is another turnaround story. With
approximately 75% of Mexico's advertising market, it is the largest producer of
Spanish-speaking programming in the world. However, a new entrant into the
market has shaken Televisa's once-solid dominance, and the current controlling
shareholders realized a restructuring program was necessary to ward off
increasing competition. The re-structuring program included cutting costs,
improving the company's business focus and hiring professional managers--both on
the creative programming and the financial sides of the business.
Mexico's strong economic growth--due in large part to a fortified U.S.
economy and lower-than-expected Mexican inflation rates--also played into the
decision to increase our ownership of Televisa. Strong economic growth often
correlates with increasing corporate profitability and consumer spending, two
leading indicators of increasing advertising spending. So, along with a
supportive backdrop for the Latin American media industry to do well, Televisa
is a company going through a turnaround with a fundamental story of improving
earnings.
WHAT IS YOUR MARKET AND FUND OUTLOOK FOR THE SHORT TERM?
Latin American markets are likely to remain sensitive to moves in the U.S.
markets, although recent market behavior strengthens our view that in periods of
relatively flat U.S. performance--as we had for much of the third quarter of
1999--Latin markets are capable of reflecting positive domestic developments.
External factors are also improving as commodities show broader positive price
trends on the back of improving global demand.
Important issues for 2000 are the outcome of the Mexican elections and of
Brazil's attempts to pass structural reforms that address fiscal and social
security imbalances. Although the government is tackling these issues, the
complexity of Brazilian politics makes the speed of reform unpredictable.
Fortunately, even with limited progress the economic recovery and improved
market stability can likely support significant share-price recovery as
valuations remain undemanding.
Within the portfolio we favor commodity-recovery, lower-valuation,
higher-growth stocks with a cyclical bias in recovering economies. And despite
the inherent risks in the emerging-market sector, Latin America presents strong
growth potential for long-term investors who seek diversification by investing
in this exciting region.
See important fund and index disclosures inside front cover.
AIM LATIN AMERICAN GROWTH FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM LATIN AMERICAN GROWTH FUND VS. BENCHMARK INDEX
8/13/91-10/31/99
in thousands
<TABLE>
<CAPTION>
================================================================================
AIM Latin American MSCI Emerging
Growth Fund, Latin America Index
Class A Shares
- --------------------------------------------------------------------------------
<S> <C> <C>
8/13/91 $ 9,527 $10,000
10/31/91 10,967 11,372
10/31/92 10,476 13,358
10/31/93 14,360 17,869
10/31/94 19,257 25,603
10/31/95 12,101 17,156
10/31/96 14,221 21,156
10/31/97 15,433 26,192
10/31/98 9,281 18,803
10/31/99 11,223 23,449
Past performance cannot guarantee comparable future results.
================================================================================
</TABLE>
Source: Lipper Inc.
MARKET VOLATILITY CAN SIGNIFICANTLY IMPACT SHORT-TERM PERFORMANCE. RESULTS
OF AN INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM THE HISTORICAL
PERFORMANCE SHOWN.
ABOUT THIS CHART
The chart compares your fund's Class A shares to its benchmark index. Use of
this index is intended to give you a general idea of how your fund performed
compared to this benchmark over the period 8/13/91-10/31/99. (Please note the
index's performance figures are for the period 7/31/91-10/31/99.) It is
important to understand the differences between your fund and this index. An
index measures the performance of a hypothetical portfolio. A market index such
as the MSCI Emerging Latin America Index is not managed and incurs no sales
charges, expenses or fees. If you could buy all the securities that compose a
market index, you would incur expenses that would affect your investment's
return.
AVERAGE ANNUAL TOTAL RETURNS
As of 10/31/99, including sales charges
================================================================================
CLASS A SHARES
Inception (8/13/91) 1.41%
5 Years -11.10
1 Year 15.21*
* 20.92% excluding sales charges
CLASS B SHARES
Inception (4/1/93) -1.22
5 Years -10.98
1 Year 15.36*
* 20.36% excluding sales charges
ADVISOR CLASS SHARES (Sales charges do not apply)
Inception (6/15/95) -2.14
3 Years -7.22
1 Year 21.56
CLASS C SHARES
Inception (3/1/99) 34.06
================================================================================
Your fund's total returns include sales charges, expenses and management fees.
The performance of the fund's Class B, Class C and Advisor Class shares will
differ from Class A shares due to differing fees and expenses. For fund
performance calculations and descriptions of the indexes cited on this page,
please see the inside front cover.
AIM LATIN AMERICAN GROWTH FUND
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
October 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-97.58%
ARGENTINA-11.90%
Acindar Industria Argentina de
Aceros S.A.-Series B (Iron &
Steel)(a) 400,000 $ 640,301
- --------------------------------------------------------------
Banco de Galicia y Buenos Aires
S.A. de C.V.-ADR (Banks-Regional) 46,118 974,243
- --------------------------------------------------------------
Banco Hipotecario S.A.-Wts.
(Banks-Regional), expiring
02/02/04(b) 617 339,350
- --------------------------------------------------------------
Banco Rio de La Plata S.A.-ADR
(Banks-Major Regional) 100,233 1,290,500
- --------------------------------------------------------------
Fivenez Banco Hipotecario
(Banks-Regional) 122,243 1,388,143
- --------------------------------------------------------------
IRSA Inversiones y Representaciones
S.A.-GDR (Land Development) 35,157 1,061,302
- --------------------------------------------------------------
Juan Minetti S.A.
(Construction-Cement &
Aggregates)(a) 170,390 461,974
- --------------------------------------------------------------
Nortel Inversora S.A.-ADR
(Telephone) 200,500 3,032,563
- --------------------------------------------------------------
Quilmes Industrial S.A.-ADR
(Beverages-Alcoholic) 132,164 1,379,462
- --------------------------------------------------------------
10,567,838
- --------------------------------------------------------------
BRAZIL-35.74%
C.A. La Electricidad de Caracas-ADR
(Electric Companies) 88,588 1,669,866
- --------------------------------------------------------------
Caemi Mineracao E Metalurgica
S.A.-Pfd. (Iron & Steel) 12,750,000 597,656
- --------------------------------------------------------------
Companhia Brasileira de Petroleo
Ipiranga (Oil & Gas-Refining &
Marketing) 120,000,000 960,861
- --------------------------------------------------------------
Companhia Cimento Portland Itau
(Construction-Cement &
Aggregates) 650,000 64,101
- --------------------------------------------------------------
Companhia de Saneamento Basico do
Estado de Sao Paulo (Water
Utilities) 17,292,622 1,164,949
- --------------------------------------------------------------
Companhia de Tecidos Norte de Minas
(Textiles-Specialty) 11,622,000 821,637
- --------------------------------------------------------------
Companhia Energetica de Minas
Gerais-ADR (Electric Companies) 114,506 1,636,600
- --------------------------------------------------------------
Companhia Paranaense de
Energia-Copel-ADR (Electric
Companies) 150,782 602,510
- --------------------------------------------------------------
Companhia Paranaense de Energia-
Copel-(Electric Companies) 147,935 980,069
- --------------------------------------------------------------
Companhia Vale do Rio Doce-Pfd. A
(Iron & Steel) 141,823 2,818,296
- --------------------------------------------------------------
Eletropaulo Metropolitana-
Eletricidade de Sao
Paulo S.A. (Electric Companies) 38,440,242 1,752,654
- --------------------------------------------------------------
Embratel Participacoes S.A.-Pfd.
(Telecommunications-Long
Distance) 109,450,000 1,396,160
- --------------------------------------------------------------
Itausa-Investimentos Itau S.A.-Pfd.
(Investment Management) 3,749,289 2,266,476
- --------------------------------------------------------------
Itausa-Investimentos Itau S.A.-Pfd.
Receipts (Investment Management) 151,050 91,311
- --------------------------------------------------------------
Petroleo Brasileiro
S.A.-Petrobras-Pfd. (Oil &
Gas-Exploration & Production) 30,958,655 4,924,520
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
BRAZIL-(CONTINUED)
Tele Centro Sul Participacoes
S.A.-ADR (Telephone) 22,500 $ 1,344,375
- --------------------------------------------------------------
Tele Norte Leste Participacoes
S.A.-Pfd. (Telephone) 52,745,000 886,289
- --------------------------------------------------------------
Telecomunicacoes Brasileiras C.M.
(Telephone) 41,725,004 2,167,477
- --------------------------------------------------------------
Telecomunicacoes Brasileiras S.A.
(Telephone)(a) 86,027,000 2,644
- --------------------------------------------------------------
Telecomunicacoes de Sao Paulo
S.A.-Pfd. (Telephone) 7,448,813 700,234
- --------------------------------------------------------------
Telesp Celular S.A.
(Telecommunications-
Cellular/Wireless) 12,532,000 436,933
- --------------------------------------------------------------
Telesp Celular S.A.-Pfd. B
(Telecommunications-
Cellular/Wireless) 6,373,727 333,053
- --------------------------------------------------------------
Uniao de Bancos Brasileiros
S.A.-GDR (Banks-Regional) 49,672,000 1,148,665
- --------------------------------------------------------------
Unibanco-Uniao de Bancos
Brasileiros S.A. (Banks-Major
Regional)(c) 15,000,200 691,684
- --------------------------------------------------------------
Usinas Siderurgicas de Minas Gerais
S.A.-Pfd. A
(Manufacturing-Diversified) 160,300,000 583,058
- --------------------------------------------------------------
Votorantim Celulose e Papel S.A.
(Paper & Forest Products) 57,900,000 1,690,727
- --------------------------------------------------------------
31,732,805
- --------------------------------------------------------------
CHILE-7.50%
Administradora de Fondos de
Peniones Provida S.A.-ADR
(Financial-Diversified) 100,642 1,736,075
- --------------------------------------------------------------
Banco de A. Edwards-ADR
(Banks-Regional) 41,904 612,846
- --------------------------------------------------------------
Compania Cervecerias Unidas
S.A.-ADR (Beverages-Alcoholic) 67,500 1,472,344
- --------------------------------------------------------------
Embotelladora Arica S.A.-ADR
(Beverages- Non-Alcoholic)
(Acquired 04/23/99; Cost
$536,625(d) 40,500 391,092
- --------------------------------------------------------------
Quinenco S.A.-ADR
(Financial-Diversified) 29,900 278,444
- --------------------------------------------------------------
Sociedad Quimica y Minera de Chile
S.A.-ADR (Chemicals) 59,100 1,717,594
- --------------------------------------------------------------
Supermercados Unimarc S.A.-ADR
(Retail-Food Chains) 207,200 453,250
- --------------------------------------------------------------
6,661,645
- --------------------------------------------------------------
MEXICO-35.62%
Alpha S.A. de C.V.-Class A
(Manufacturing- Diversified) 472,700 1,814,106
- --------------------------------------------------------------
Apasco S.A. de C.V.
(Construction-Cement &
Aggregates) 213,731 1,133,675
- --------------------------------------------------------------
Carso Global Telecom-Class A1
(Telephone)(a) 550,000 3,660,946
- --------------------------------------------------------------
Cemex S.A. de C.V.
(Construction-Cement &
Aggregates) 364,968 1,651,181
- --------------------------------------------------------------
Cintra S.A. (Airlines) 393,300 173,437
- --------------------------------------------------------------
Consorcio Ara, S.A. de C.V.
(Homebuilding)(a) 690,000 776,474
- --------------------------------------------------------------
Controladora Comercial Mexicana
S.A. de C.V. (Retail-Department
Stores)(e) 1,750,000 1,448,778
- --------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
MEXICO-(CONTINUED)
Corporacion GEO S.A. de C.V.-Series
B (Construction-Cement &
Aggregates)(a) 271,000 $ 687,717
- --------------------------------------------------------------
El Puerto de Liverpool S.A. de
C.V.-Series 1 (Retail-Department
Stores) 45,941 78,838
- --------------------------------------------------------------
Fomento Economico Mexicano, S.A. de
C.V.-ADR (Beverages-Alcoholic)(b) 80,000 2,625,000
- --------------------------------------------------------------
Grupo Bimbo S.A. de C.V. (Foods)(a) 579,800 1,063,720
- --------------------------------------------------------------
Grupo Carso S.A. de C.V.-Series A1
(Manufacturing-Diversified)(a) 611,000 2,560,926
- --------------------------------------------------------------
Grupo Cementos de Chihuahua S.A. de
C.V.-Class B (Construction-Cement
& Aggregates) 210,000 133,229
- --------------------------------------------------------------
Grupo Financiero Bancomer, S.A. de
C.V.-Class O (Banks-Regional)(a) 4,715,464 1,250,591
- --------------------------------------------------------------
Grupo Financiero Banorte S.A. de
C.V.-Class O
(Financial-Diversified)(a) 1,500,000 1,872,075
- --------------------------------------------------------------
Grupo Industrial Maseca S.A. de
C.V.-Class B (Foods) 1,686,100 841,735
- --------------------------------------------------------------
Grupo Mexico S.A.-Series B (Metals
Mining) 205,824 744,948
- --------------------------------------------------------------
Grupo Posadas S.A.-Series A
(Lodging-Hotels)(a) 471,000 254,727
- --------------------------------------------------------------
Grupo Posadas S.A.-Series L
(Lodging-Hotels)(a) 752,300 344,266
- --------------------------------------------------------------
Grupo Televisa S.A.-GDR
(Entertainment)(a) 105,600 4,488,000
- --------------------------------------------------------------
Industrias Penoles S.A. (Metals
Mining) 484,600 1,527,133
- --------------------------------------------------------------
Kimberly-Clark de Mexico, S.A. de
C.V.-Class A (Paper & Forest
Products) 600,000 1,921,997
- --------------------------------------------------------------
Pepsi-Gemex S.A.-GDR (Beverages-
Non-Alcoholic)(a) 122,800 567,950
- --------------------------------------------------------------
31,621,449
- --------------------------------------------------------------
PANAMA-1.55%
Banco Latinoamericano de
Exportaciones, S.A.
(Banks-Regional) 57,597 1,378,728
- --------------------------------------------------------------
PERU-2.80%
Credicorp Ltd.
(Financial-Diversified) 152,332 1,618,528
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
PERU-(CONTINUED)
Telefonica del Peru S.A.A.-ADR
(Telephone) 42,500 $ 491,406
- --------------------------------------------------------------
Union de Cervecerias Backus &
Johnston S.A.A.
(Beverages-Alcoholic) 1,008,223 371,948
- --------------------------------------------------------------
2,481,882
- --------------------------------------------------------------
UNITED KINGDOM-1.86%
Antofagasta Holdings PLC (Gold &
Precious Metals Mining) 240,000 1,649,361
- --------------------------------------------------------------
VENEZUELA-0.61%
C.A. La Electricidad de Caracas
(Electric Companies)(f) 186,266 70,768
- --------------------------------------------------------------
Corporacion Venezolana de Cementos
S.A.C.A.-I (Constructions-Cement
& Aggregates) 675,057 293,875
- --------------------------------------------------------------
Corporacion Venezolana de Cementos
S.A.C.A.-II (Constructions-Cement
& Aggregates) 446,248 176,606
- --------------------------------------------------------------
541,249
- --------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$102,130,895) 86,634,957
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT(g)
<S> <C> <C>
CORPORATE BONDS-0.00%
BRAZIL-0.00%
Companhia Vale do Rio Doce-Non
Convertible (Cost $0) BRL 276,400 0
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
MONEY MARKET FUNDS-0.91%
STIC Liquid Assets Portfolio(h) 404,169 404,169
- --------------------------------------------------------------
STIC Prime Portfolio(h) 404,169 404,169
- --------------------------------------------------------------
Total Money Market Funds (Cost
$808,338) 808,338
- --------------------------------------------------------------
TOTAL INVESTMENTS-98.49% 87,443,295
- --------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-1.51% 1,344,875
- --------------------------------------------------------------
NET ASSETS-100.00% $88,788,170
- --------------------------------------------------------------
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
GDR - Global Depositary Receipt
Pfd. - Preferred
Wts. - Warrants
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Non-income producing security acquired as part of a unit with or in exchange
for other securities.
(c) Each unit represents one preferred share of Unibanco and one preferred B
share of Unibanco Holdings.
(d) Restricted security. May be resold to qualified institutional buyers in
accordance with provisions of Rule 144A under the Securities Act of 1933, as
amended. The valuation of this security has been determined in accordance
with procedures established by the Board of Trustees. The market value at
10/31/99 was $391,092 which represented 0.44% of the Fund's net assets.
(e) Each unit represents three B shares and one C share.
(f) Each unit represents one share of Electricidad de Caracas and one share of
Corporacion EDC.
(g) Foreign denominated security. Par value and coupon are denominated in
currency indicated.
(h) The security shares the same investment advisor as the Fund.
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $102,939,233) $ 87,443,295
- -------------------------------------------------------------
Foreign currencies, at value (cost $568,244) 573,893
- -------------------------------------------------------------
Receivables for:
Investments sold 843,462
- -------------------------------------------------------------
Fund shares sold 80,031
- -------------------------------------------------------------
Dividends and interest 279,049
- -------------------------------------------------------------
Other assets 20,338
- -------------------------------------------------------------
Total assets 89,240,068
- -------------------------------------------------------------
LIABILITIES:
Payable for fund shares reacquired 254,077
- -------------------------------------------------------------
Accrued advisory fees 9,838
- -------------------------------------------------------------
Accrued distribution fees 40,251
- -------------------------------------------------------------
Accrued accounting services fees 4,247
- -------------------------------------------------------------
Accrued transfer agent fees 21,021
- -------------------------------------------------------------
Accrued trustees' fees 2,762
- -------------------------------------------------------------
Other liabilities 119,702
- -------------------------------------------------------------
Total liabilities 451,898
- -------------------------------------------------------------
Net assets applicable to shares outstanding $ 88,788,170
- -------------------------------------------------------------
NET ASSETS:
Class A $ 49,788,968
- -------------------------------------------------------------
Class B $ 38,455,515
- -------------------------------------------------------------
Class C $ 146,525
- -------------------------------------------------------------
Advisor Class $ 397,162
- -------------------------------------------------------------
SHARES OUTSTANDING, $0.01 PAR VALUE PER
SHARE:
Class A 3,564,736
- -------------------------------------------------------------
Class B 2,788,851
- -------------------------------------------------------------
Class C 10,624
- -------------------------------------------------------------
Advisor Class 28,479
- -------------------------------------------------------------
Class A:
Net asset value and redemption price per
share $ 13.97
- -------------------------------------------------------------
Offering price per share:
(Net asset value of $13.97 divided by
95.25%) $ 14.67
- -------------------------------------------------------------
Class B:
Net asset value and offering price per
share $ 13.79
- -------------------------------------------------------------
Class C:
Net asset value and offering price per
share $ 13.79
- -------------------------------------------------------------
Advisor Class:
Net asset value, redemption and offering
price per share $ 13.95
- -------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
For the year ended October 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $479,760 foreign withholding
tax) $ 3,291,105
- ------------------------------------------------------------
Interest 35,745
- ------------------------------------------------------------
Securities lending 91,156
- ------------------------------------------------------------
Total investment income 3,418,006
- ------------------------------------------------------------
EXPENSES:
Advisory and administrative fees 952,046
- ------------------------------------------------------------
Accounting services fees 38,349
- ------------------------------------------------------------
Custodian fees 53,267
- ------------------------------------------------------------
Interest expense (Note 5) 54,310
- ------------------------------------------------------------
Distribution fees -- Class A 273,567
- ------------------------------------------------------------
Distribution fees -- Class B 422,771
- ------------------------------------------------------------
Distribution fees -- Class C 713
- ------------------------------------------------------------
Printing fees 284,503
- ------------------------------------------------------------
Trustees' fees 11,926
- ------------------------------------------------------------
Transfer agent fees -- Class A 338,413
- ------------------------------------------------------------
Transfer agent fees -- Class B 261,324
- ------------------------------------------------------------
Transfer agent fees -- Class C 445
- ------------------------------------------------------------
Transfer agent fees -- Advisor Class 3,624
- ------------------------------------------------------------
Other 93,931
- ------------------------------------------------------------
Total expenses 2,789,189
- ------------------------------------------------------------
Less: Expenses paid indirectly (3,131)
- ------------------------------------------------------------
Fees waived by advisor (572,144)
- ------------------------------------------------------------
Net expenses 2,213,914
- ------------------------------------------------------------
Net investment income 1,204,092
- ------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES AND FOREIGN
CURRENCIES:
Net realized gain (loss) from:
Investment securities (29,737,138)
- ------------------------------------------------------------
Foreign currencies (539,564)
- ------------------------------------------------------------
(30,276,702)
- ------------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of:
Investment securities 48,113,915
- ------------------------------------------------------------
Foreign currencies (35,910)
- ------------------------------------------------------------
48,078,005
- ------------------------------------------------------------
Net gain from investment securities and
foreign currencies 17,801,303
- ------------------------------------------------------------
Net increase in net assets resulting from
operations $ 19,005,395
- ------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
7
<PAGE> 10
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended October 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------ -------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 1,204,092 $ 1,153,228
- -------------------------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies (30,276,702) (18,715,746)
- -------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities and foreign currencies 48,078,005 (54,475,416)
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 19,005,395 (72,037,934)
- -------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A (703,214) (219,544)
- -------------------------------------------------------------------------------------------
Class B (122,741) --
- -------------------------------------------------------------------------------------------
Advisor Class (9,487) (5,514)
- -------------------------------------------------------------------------------------------
Share transactions-net:
Class A (22,064,281) (61,587,566)
- -------------------------------------------------------------------------------------------
Class B (15,015,084) (52,032,524)
- -------------------------------------------------------------------------------------------
Class C 158,037 --
- -------------------------------------------------------------------------------------------
Advisor Class (144,362) (13,073)
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (18,895,737) (185,896,155)
- -------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 107,683,907 293,580,062
- -------------------------------------------------------------------------------------------
End of period $ 88,788,170 $ 107,683,907
===========================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $167,043,253 $ 204,122,934
- -------------------------------------------------------------------------------------------
Undistributed net investment income 675,072 831,995
- -------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities and foreign currencies (63,367,151) (33,630,013)
- -------------------------------------------------------------------------------------------
Unrealized appreciation (depreciation) of investment
securities and foreign currencies (15,563,004) (63,641,009)
- -------------------------------------------------------------------------------------------
$ 88,788,170 $ 107,683,907
===========================================================================================
</TABLE>
See Notes to Financial Statements.
8
<PAGE> 11
NOTES TO FINANCIAL STATEMENTS
October 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Latin American Growth Fund (the "Fund") is a separate series of AIM
Investment Funds (the "Trust"). The Trust is organized as a Delaware business
trust and is registered under the Investment Company Act of 1940, as amended
(the "1940 Act"), as an open-end series management investment company consisting
of twelve separate series portfolios, each having an unlimited number of shares
of beneficial interest. The Fund consists of four different classes of shares:
Class A shares, Class B shares, Class C shares and Advisor Class shares. Class A
shares are sold with a front-end sales charge. Class B shares and Class C shares
are sold with a contingent deferred sales charge. Advisor Class shares were sold
without a sales charge. Matters affecting each portfolio or class will be voted
on exclusively by the shareholders of such portfolio or class. The assets,
liabilities and operations of each portfolio are accounted for separately.
Information presented in these financial statements pertains only to the Fund.
The Fund's investment objective is growth of capital.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. The
following is a summary of the significant accounting policies followed by the
Fund in the preparation of its financial statements.
A. Security Valuations -- A security listed or traded on an exchange (except
convertible bonds) is valued at its last sales price on the exchange where
the security is principally traded, or lacking any sales on a particular
day, the security is valued at the closing bid price on that day. Each
security reported on the NASDAQ National Market System is valued at the
last sales price on the valuation date or absent a last sales price, at the
closing bid price. Debt obligations (including convertible bonds) are
valued on the basis of prices provided by an independent pricing service.
Prices provided by the pricing service may be determined without exclusive
reliance on quoted prices, and may reflect appropriate factors such as
yield, type of issue, coupon rate and maturity date. Securities for which
market prices are not provided by any of the above methods are valued based
upon quotes furnished by independent sources and are valued at the last bid
price in the case of equity securities and in the case of debt obligations,
the mean between the last bid and asked prices. Securities for which market
quotations are not readily available or are questionable are valued at fair
value as determined in good faith by or under the supervision of the
Trust's officers in a manner specifically authorized by the Board of
Trustees. Short-term obligations having 60 days or less to maturity are
valued at amortized cost which approximates market value. For purposes of
determining net asset value per share, futures and options contracts
generally will be valued 15 minutes after the close of trading of the New
York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed each
day at various times prior to the close of the NYSE. The values of such
securities used in computing the net asset value of the Fund's shares are
determined as of such times. Foreign currency exchange rates are also
generally determined prior to the close of the NYSE. Occasionally, events
affecting the values of such securities and such exchange rates may occur
between the times at which they are determined and the close of the NYSE
which would not be reflected in the computation of the Fund's net asset
value. If events materially affecting the value of such securities occur
during such period, then these securities will be valued at their fair
value as determined in good faith by or under the supervision of the Board
of Trustees.
B. Securities Transactions, Investment Income and Distributions -- Securities
transactions are accounted for on a trade date basis. Realized gains or
losses on sales are computed on the basis of specific identification of the
securities sold. Interest income is recorded as earned from settlement date
and is recorded on the accrual basis. Dividend income is recorded on the
ex-dividend date. The Fund may elect to use a portion of the proceeds of
fund share redemptions as distributions for Federal income tax purposes.
Distributions from income and net realized capital gains, if any, are
generally paid annually and recorded on ex-dividend date.
On October 31, 1999, undistributed net investment income was decreased by
$525,573, undistributed net realized gains increased by $539,564 and
paid-in capital decreased by $13,991 as a result of differing book/tax
treatment of foreign currency transactions and net operating loss
reclassifications in order to comply with the requirements of the American
Institute of Certified Public Accountants Statement of Position 93-2. Net
assets of the Fund were unaffected by the reclassifications discussed
above.
C. Federal Income Taxes -- The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income
taxes is recorded in the financial statements. The Fund has a capital loss
carryforward of $61,871,107 as of October 31, 1999 which may be carried
forward to offset future taxable gains, if any, and expires in varying
increments, if not previously utilized, in the year 2007.
D. Foreign Currency Translations -- Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S.
dollar amounts at date of valuation. Purchases and sales of portfolio
securities and income items denominated in foreign currencies are
translated into U.S. dollar amounts on the respective dates of such
transactions. The Fund does not separately account for that portion of the
results of operations resulting from changes in
9
<PAGE> 12
foreign exchange rates on investments and 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.
E. Foreign Currency Contracts -- A foreign currency contract is an obligation
to purchase or sell a specific currency for an agreed-upon price at a
future date. The Fund may enter into a foreign currency contract to attempt
to minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency
contract for the purchase or sale of a security denominated in a foreign
currency in order to "lock in" the U.S. dollar price of that security. The
Fund could be exposed to risk if counterparties to the contracts are unable
to meet the terms of their contracts or if the value of the foreign
currency changes unfavorably.
F. Futures Contracts -- The Fund may purchase or sell futures contracts as a
hedge against changes in market conditions. Initial margin deposits
required upon entering into futures contracts are satisfied by the
segregation of specific securities as collateral for the account of the
broker (the Fund's agent in acquiring the futures position). During the
period the futures contracts are open, changes in the value of the
contracts are recognized as unrealized gains or losses by "marking to
market" on a daily basis to reflect the market value of the contracts at
the end of each day's trading. Variation margin payments are made or
received depending upon whether unrealized gains or losses are incurred.
When the contracts are closed, the Fund recognizes a realized gain or loss
equal to the difference between the proceeds from, or cost of, the closing
transaction and the Fund's basis in the contract. Risks include the
possibility of an illiquid market and that a change in value of the
contracts may not correlate with changes in the value of the securities
being hedged.
G. Expenses -- Distribution expenses directly attributable to a class of
shares are charged to that class' operations. All other expenses which are
attributable to more than one class are allocated among the classes.
H. 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
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 fluctuations, perceived credit
risk,adverse political and economic developments and possible adverse
foreign government intervention.
I. Indexed Securities -- The Fund 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.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Fund's investment manager and administrator.
INVESCO Asset Management Limited is the Fund's sub-advisor and
sub-administrator. The Fund pays AIM investment management and administration
fees at an annual rate of 0.975% on the first $500 million of the Fund's average
daily net assets, plus 0.95% on the next $500 million of the Fund's average
daily net assets, plus 0.925% on the next $500 million of the Fund's average
daily net assets, plus 0.90% on the Fund's average daily net assets exceeding
$1.5 billion. AIM has contractually agreed to limit the Fund's expenses
(exclusive of brokerage commissions, taxes, interest and extraordinary expenses)
to the maximum annual rate of 2.00%, 2.50%, 2.50% and 1.50% of the average daily
net assets of the Fund's Class A, Class B, Class C and Advisor Class shares,
respectively. During the year ended October 31, 1999, AIM waived fees of
$572,144.
Effective July 1, 1999, the Trust entered into a master administrative
services agreement with AIM, replacing the prior pricing and accounting
agreement. The Fund, pursuant to the master administrative services agreement
with AIM, has agreed to pay AIM for certain administrative costs incurred in
providing accounting services to the Fund. Prior to July 1, 1999, AIM was the
pricing and accounting agent for the Fund. The monthly fee for these services
paid to AIM was a percentage, not to exceed 0.03% annually, of a Fund's average
daily net assets. The annual fee rate was derived based on the aggregate net
assets of the funds which comprised the following investment companies: AIM
Growth Series, AIM Investment Funds, AIM Series Trust, G.T. Global Variable
Investment Series and G.T. Global Variable Investment Trust. The fee was
calculated at the rate of 0.03% of the first $5 billion of assets and 0.02% to
the assets in excess of $5 billion. An amount is allocated to and paid by each
such fund based on its relative average daily net assets. For the year ended
October 31, 1999, AIM was paid $38,349 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency and
shareholder services to the Fund. For the year ended October 31, 1999, AFS was
paid $570,779 for such services.
The Trust has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B, Class C and Advisor Class shares of the Fund. The Trust has
adopted a plan pursuant to Rule 12b-1 under the 1940 Act with respect to the
Fund's Class A shares, Class B shares and Class C shares (collectively the
"Plans"). The Fund , pursuant to the Plans, pays AIM Distributors compensation
at the annual rate of 0.50% of the Fund's average daily net assets of Class A
shares and 1.00% of the average daily net assets of Class B and C shares. Of
these amounts, the Fund may pay a service fee of 0.25% of the average daily net
assets of the Class A, Class B or Class C shares to selected dealers and
financial institutions who furnish continuing personal shareholder services to
their customers who purchase and own the appropriate class of shares of the
Fund. Any amounts not paid as a service fee under the Plans would constitute an
asset-based sales charge. The Plans also impose a cap on the total sales
charges, including asset-based sales charges that may be paid by the respective
classes. For the
10
<PAGE> 13
year ended October 31, 1999, the Class A, Class B and Class C shares paid AIM
Distributors $273,567, $422,771 and $713, respectively, as compensation under
the Plans.
AIM Distributors received commissions of $12,934 from sales of the Class A
shares of the Fund during the year ended October 31, 1999. Such commissions are
not an expense of the Fund. They are deducted from, and are not included in, the
proceeds from sales of Class A shares. During the year ended October 31, 1999,
AIM Distributors received $536 in contingent deferred sales charges imposed on
redemptions of Fund shares. Certain officers and trustees of the Trust are
officers and directors of AIM, AFS and AIM Distributors.
NOTE 3-INDIRECT EXPENSES
During the year ended October 31, 1999, the Fund received reductions in
custodian fees of $3,131 under expense offset arrangements. The effect of the
above arrangements resulted in a reduction of the Fund's total expenses of
$3,131 during the year ended October 31, 1999.
NOTE 4-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by The Chase Manhattan Bank. The Fund may borrow up to
the lesser of (i) $1,000,000,000 or (ii) the limits set by its prospectus for
borrowings. The Fund and other funds advised by AIM which are parties to the
line of credit may borrow on a first come, first served basis. The funds which
are party to the line of credit are charged a commitment fee of 0.09% on the
unused balance of the committed line. The commitment fee is allocated among the
funds based on their respective average net assets for the period. Prior to May
28, 1999, the Fund, along with certain other funds advised and/or administered
by AIM, had a line of credit with BankBoston and State Street Bank & Trust
Company. The arrangements with the banks allowed the Fund and certain other
funds to borrow, on a first come, first served basis, an aggregate maximum
amount of $250,000,000.
During the year ended October 31, 1999, the average outstanding daily balance
of bank loans for the Fund was $965,592 with a weighted average interest rate of
5.62%. Interest expense for the Fund for the year ended October 31, 1999 was
$54,310.
NOTE 5-PORTFOLIO SECURITIES LOANED
At October 31, 1999, securities with an aggregate value of $2,926,733 were on
loan to brokers. The loans were secured by cash collateral of $2,985,267
received by the Fund. For the year ended October 31, 1999, the Fund received
fees of $91,156 for securities lending.
For international securities, cash collateral is received by the Fund 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 the Fund 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. The cash collateral is
invested in a securities lending trust which consists of a portfolio of high
quality short duration securities whose average effective duration is restricted
to 120 days or less.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the year ended October 31, 1999 was
$28,967,058 and $62,536,455, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of October 31, 1999 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $ 10,237,584
- ---------------------------------------------------------
Aggregate unrealized appreciation
(depreciation) of investment securities (27,229,564)
- ---------------------------------------------------------
Net unrealized appreciation (depreciation)
of investment securities $(16,991,980)
=========================================================
</TABLE>
Cost of investments for tax purposes is $104,435,275.
11
<PAGE> 14
NOTE 7-SHARE INFORMATION
Changes in shares outstanding during the years ended October 31, 1999 and 1998
were as follows:
<TABLE>
<CAPTION>
1999 1998
-------------------------- ---------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Sold:
Class A 10,698,303 $130,700,031 31,480,158 $ 504,106,417
- ----------------------------------------------------------------------------------------------------------------------
Class B 1,074,686 14,304,893 14,533,097 243,328,768
- ----------------------------------------------------------------------------------------------------------------------
Class C* 20,395 302,050 -- --
- ----------------------------------------------------------------------------------------------------------------------
Advisor Class 103,353 1,459,954 1,261,470 24,366,740
- ----------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class A 56,745 633,836 8,770 183,909
- ----------------------------------------------------------------------------------------------------------------------
Class B 9,959 110,343 -- --
- ----------------------------------------------------------------------------------------------------------------------
Advisor Class 833 9,259 261 5,468
- ----------------------------------------------------------------------------------------------------------------------
Reacquired:
Class A (12,381,943) (153,398,148) (34,474,810) (565,877,892)
- ----------------------------------------------------------------------------------------------------------------------
Class B (2,351,288) (29,430,320) (17,417,330) (295,361,292)
- ----------------------------------------------------------------------------------------------------------------------
Class C* (9,771) (144,013) -- --
- ----------------------------------------------------------------------------------------------------------------------
Advisor Class (106,874) (1,613,575) (1,263,040) (24,385,281)
- ----------------------------------------------------------------------------------------------------------------------
(2,885,602) $(37,065,690) (5,871,424) $(113,633,163)
======================================================================================================================
</TABLE>
* Class C shares commenced sales on March 1, 1999.
NOTE 8-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>
CLASS A
----------------------------------------------------------
YEAR ENDED OCTOBER 31,
----------------------------------------------------------
1999 1998(a) 1997(a) 1996(a) 1995(a)
------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 11.70 $ 19.50 $ 17.95 $ 15.38 $ 26.11
- -------------------------------------------------------- ------- ------- -------- -------- --------
Income from investment operations:
Net investment income (loss) 0.21 0.13(b) 0.11 0.09 0.15
- -------------------------------------------------------- ------- ------- -------- -------- --------
Net realized and unrealized gain (loss) on investments 2.20 (7.90) 1.44 2.59 (9.28)
- -------------------------------------------------------- ------- ------- -------- -------- --------
Net increase (decrease) from investment operations 2.41 (7.77) 1.55 2.68 (9.13)
- -------------------------------------------------------- ------- ------- -------- -------- --------
Distributions to shareholders:
From net investment income (0.14) (0.03) -- (0.08) --
- -------------------------------------------------------- ------- ------- -------- -------- --------
From net realized gain on investments -- -- -- -- (1.60)
- -------------------------------------------------------- ------- ------- -------- -------- --------
In excess of net investment income -- -- -- (0.03) --
- -------------------------------------------------------- ------- ------- -------- -------- --------
Total distributions (0.14) (0.03) -- (0.11) (1.60)
- -------------------------------------------------------- ------- ------- -------- -------- --------
Net asset value, end of period $ 13.97 $ 11.70 $ 19.50 $ 17.95 $ 15.38
======================================================== ======= ======= ======== ======== ========
Total return(c) 20.93% (39.86)% 8.52% 17.52% (37.16)%
======================================================== ======= ======= ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in 000s) $49,789 $60,720 $159,496 $177,373 $182,462
- -------------------------------------------------------- ------- ------- -------- -------- --------
Ratio of net investment income to average net assets:
With fee waivers 1.44%(d) 0.78% 0.52% 0.46% 0.86%
- -------------------------------------------------------- ------- ------- -------- -------- --------
Without fee waivers 0.85%(d) 0.64% 0.42% 0.39% 0.85%
======================================================== ======= ======= ======== ======== ========
Ratio of expenses to average net assets (excluding
interest expense):
With fee waivers 2.00%(d) 2.00% 1.96% 2.03% 2.11%
- -------------------------------------------------------- ------- ------- -------- -------- --------
Without fee waivers 2.59%(d) 2.14% 2.06% 2.10% 2.12%
======================================================== ======= ======= ======== ======== ========
Ratio of interest expense to average net assets 0.06% 0.17% N/A N/A N/A
- -------------------------------------------------------- ------- ------- -------- -------- --------
Portfolio turnover rate 30% 39% 130% 101% 125%
======================================================== ======= ======= ======== ======== ========
</TABLE>
(a) These selected per share data were calculated based upon the average shares
outstanding during the period.
(b) Before reimbursement the net investment income per share would have been
reduced by $.02.
(c) Total return does not include sales charges and is not annualized for
periods less than one year.
(d) Ratios are based on average net assets of $54,713,405.
12
<PAGE> 15
NOTE 8-FINANCIAL HIGHLIGHTS (CONTINUED)
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>
CLASS B
-----------------------------------------------------------
YEAR ENDED OCTOBER 31,
-----------------------------------------------------------
1999 1998(a) 1997(a) 1996(a) 1995(a)
------------ ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 11.49 $ 19.23 $ 17.78 $ 15.21 $ 25.94
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Income from investment operations:
Net investment income 0.17 0.04(b) 0.01 -- 0.06
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Net realized and unrealized gain (loss) on investments 2.16 (7.78) 1.44 2.59 (9.19)
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Net increase (decrease) from investment operations 2.33 (7.74) 1.45 2.59 (9.13)
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Distributions to shareholders:
From net investment income (0.03) -- -- (0.01) --
- ----------------------------------------------------------- ------- ------- -------- -------- --------
From net realized gain on investments -- -- -- -- (1.60)
- ----------------------------------------------------------- ------- ------- -------- -------- --------
In excess of net investment income -- -- -- (0.01) --
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Total distributions (0.03) -- -- (0.02) (1.60)
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Net asset value, end of period $ 13.79 $ 11.49 $ 19.23 $ 17.78 $ 15.21
=========================================================== ======= ======= ======== ======== ========
Total return(c) 20.36% (40.19)% 8.04% 17.02% (37.42)%
=========================================================== ======= ======= ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in 000's) $38,456 $46,599 $133,448 $137,400 $134,527
=========================================================== ======= ======= ======== ======== ========
Ratio of net investment income (loss) to average net assets:
With fee waivers 0.94%(d) 0.28% 0.02% (0.04)% 0.36%
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Without fee waivers 0.35%(d) 0.14% (0.08)% (0.11)% 0.35%
=========================================================== ======= ======= ======== ======== ========
Ratio of expenses to average net assets (excluding interest
expense):
With fee waivers 2.50%(d) 2.50% 2.46% 2.53% 2.61%
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Without fee waivers 3.09%(d) 2.64% 2.56% 2.60% 2.62%
=========================================================== ======= ======= ======== ======== ========
Ratio of interest expenses to average net assets 0.06% 0.17% N/A N/A N/A
- ----------------------------------------------------------- ------- ------- -------- -------- --------
Portfolio turnover rate 30% 39% 130% 101% 125%
=========================================================== ======= ======= ======== ======== ========
</TABLE>
(a) These selected per share data were calculated based upon the average shares
outstanding during the period.
(b) Before reimbursement the net investment income per share would have been
reduced by $0.02.
(c) Total return does not include sales charges.
(d) Ratios are based on average net assets of $42,277,069.
13
<PAGE> 16
NOTE 8-FINANCIAL HIGHLIGHTS (CONTINUED)
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>
CLASS C ADVISOR CLASS
---------------- -----------------------------------------------------------------
YEAR ENDED OCTOBER 31,
MARCH 1, 1999 TO ------------------------------------------- JUNE 1, 1995 TO
OCTOBER 31, 1999 1999 1998(a) 1997(a) 1996(a) OCTOBER 31, 1995(a)
---------------- ------ ------- ------- ------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $10.21 $11.71 $19.57 $17.94 $15.40 $15.95
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income 0.12 0.31 0.21(b) 0.19 0.17 0.09
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Net realized and unrealized gain (loss)
on investments 3.46 2.16 (7.92) 1.44 2.58 (0.64)
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Net increase (decrease) from
investment operations 3.58 2.47 (7.71) 1.63 2.75 (0.55)
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Distributions to shareholders:
From net investment income -- (0.23) (0.15) -- (0.14) --
- ----------------------------------------- ------ ------ ------ ------ ------ ------
In excess of net investment income -- -- -- -- (0.07) --
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Total distributions -- (0.23) (0.15) -- (0.21) --
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Net asset value, end of period $13.79 $13.95 $11.71 $19.57 $17.94 $15.40
========================================= ====== ====== ====== ====== ====== ======
Total return(c) 35.06% 21.56% (39.67)% 8.91% 18.16% (3.45)%
========================================= ====== ====== ====== ====== ====== ======
Ratios and supplemental data:
Net assets, end of period (in 000's) $ 147 $ 397 $ 365 $ 636 $ 818 $ 369
========================================= ====== ====== ====== ====== ====== ======
Ratio of net investment income to average
net assets:
With fee waivers 0.94%(d) 1.94%(e) 1.28% 1.02% 0.96% 1.36%(f)
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Without fee waivers 0.35%(d) 1.35%(e) 1.14% 0.92% 0.89% 1.35%(f)
========================================= ====== ====== ====== ====== ====== ======
Ratio of expenses to average net assets
(excluding interest expense):
With fee waivers 2.50%(d) 1.50%(e) 1.50% 1.46% 1.53% 1.61%(f)
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Without fee waivers 3.09%(d) 2.09%(e) 1.64% 1.56% 1.60% 1.62%(f)
========================================= ====== ====== ====== ====== ====== ======
Ratio of interest expense to average net
assets 0.06% 0.06% 0.17% N/A N/A N/A
- ----------------------------------------- ------ ------ ------ ------ ------ ------
Portfolio turnover rate 30% 30% 39% 130% 101% 125%
========================================= ====== ====== ====== ====== ====== ======
</TABLE>
(a) These selected per share data were calculated based upon the average shares
outstanding during the period.
(b) Before reimbursement the net investment income per share would have been
reduced by $0.02.
(c) Total return does not include sales charges and is not annualized for
periods less than one year.
(d) Ratios are annualized and based on average net assets of $106,283.
(e) Ratios are based on average net assets of $583,904.
(f) Annualized.
NOTE 9-SUBSEQUENT EVENT
On November 3, 1999, the Board of Trustees approved the conversion of Advisor
Class Shares into Class A Shares. The proposed effective date of this conversion
is February 11, 2000.
14
<PAGE> 17
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders of AIM Latin American Growth Fund
and Board of Trustees of AIM Investment Funds:
In our opinion, the accompanying statement of assets and
liabilities, including the schedule of investments, and
the related statements of operations and of changes in
net assets and the financial highlights present fairly,
in all material respects, the financial position of the
AIM Latin American Growth Fund at October 31, 1999, and
the results of its operations, the changes in its net
assets and the financial highlights for the periods
indicated, in conformity with generally accepted
accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund's
management; our responsibility is to express an opinion
on these financial statements based on our audits. We
conducted our audits of these financial statements in
accordance with generally accepted auditing standards
which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant
estimates made by management, and evaluating the overall
financial statement presentation. We believe that our
audits, which included confirmation of securities at
October 31, 1999 by correspondence with the custodian and
brokers, provide a reasonable basis for the opinion
expressed above.
PRICEWATERHOUSECOOPERS LLP
Boston, Massachusetts
December 23, 1999
15
<PAGE> 18
<TABLE>
<S> <C> <C>
BOARD OF TRUSTEES Gary T. Crum SUB-ADVISOR
Vice President
C. Derek Anderson INVESCO Asset Management Ltd.
President, Plantagenet Capital Carol F. Relihan 11 Devonshire Square
Management, LLC (an investment Vice President London EC2M 4YR
partnership); Chief Executive Officer, England
Plantagenet Holdings, Ltd. Mary J. Benson
(an investment banking firm) Assistant Vice President and TRANSFER AGENT
Assistant Treasurer
Frank S. Bayley A I M Fund Services, Inc.
Partner, law firm of Sheri Morris P.O. Box 4739
Baker & McKenzie Assistant Vice President and Houston, TX 77210-4739
Assistant Treasurer
Robert H. Graham CUSTODIAN
President and Chief Executive Officer, Nancy L. Martin
A I M Management Group Inc. Assistant Secretary State Street Bank and Trust Company
225 Franklin Street
Arthur C. Patterson Ofelia M. Mayo Boston, MA 02110
Managing Partner, Accel Partners Assistant Secretary
(a venture capital firm) COUNSEL TO THE FUND
Kathleen J. Pflueger
Ruth H. Quigley Assistant Secretary Kirkpatrick & Lockhart LLP
Private Investor 1800 Massachusetts Avenue, N.W.
OFFICE OF THE FUND Washington, D.C. 20036-1800
OFFICERS
11 Greenway Plaza COUNSEL TO THE TRUSTEES
Robert H. Graham Suite 100
Chairman and President Houston, TX 77046 Paul, Hastings, Janofsky & Walker LLP
Twenty Third Floor
Dana R. Sutton INVESTMENT MANAGER 555 South Flower Street
Vice President and Treasurer Los Angeles, CA 90071
A I M Advisors, Inc.
Samuel D. Sirko 11 Greenway Plaza DISTRIBUTOR
Vice President and Secretary Suite 100
Houston, TX 77046 A I M Distributors, Inc.
Melville B. Cox 11 Greenway Plaza
Vice President Suite 100
Houston, TX 77046
AUDITORS
PricewaterhouseCoopers LLP
160 Federal St.
Boston, MA 02110
</TABLE>
REQUIRED FEDERAL INCOME TAX INFORMATION -- UNAUDITED
AIM Latin American Growth Fund paid ordinary dividends in the amount of $0.1425,
$0.0320, and $0.2265 per share to Class A, Class B, and Advisor Class
shareholders, respectively during its tax year ended October 31, 1999. Of this
amount, 0.08% is eligible for the dividends received deduction for corporations.
For the fiscal year ended October 31, 1999, the amount of income received by the
Fund from sources within foreign countries and possessions of the United States
was $0.5896 per share (representing a total of $3,769,390). The amount of taxes
paid by the Fund to such countries for the fiscal year ended October 31, 1999
was $0.0750 per share (representing a total of $479,760). The following table
provides a breakdown by country of ordinary income dividends and foreign taxes
paid by the Fund during the fiscal year ended October 31, 1999.
<TABLE>
<CAPTION>
GROSS FOREIGN TAX
COUNTRY INCOME % PAID %
------- -------- -----------
<S> <C> <C>
Argentina.......................... 6.34% 0.06%
Brazil............................. 68.51% 63.81%
Chile.............................. 9.15% 27.55%
Mexico............................. 10.35% 4.61%
Various............................ 2.36% 3.97%
------ ------
96.71% 100.00%
United States...................... 3.29% 0.00%
------ ------
100.00% 100.00%
====== ======
</TABLE>
16
<PAGE> 19
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<PAGE> 20
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc. has provided
AIM Aggressive Growth Fund(1) AIM Money Market Fund leadership in the mutual fund industry since
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund 1976 and managed approximately $120 billion
AIM Capital Development Fund in assets for more than 6.4 million
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS shareholders, including individual
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund investors, corporate clients and financial
AIM Large Cap Growth Fund AIM Asian Growth Fund institutions, as of September 30, 1999.
AIM Mid Cap Equity Fund AIM Developing Markets Fund The AIM Family of Funds--Registered
AIM Mid Cap Growth Fund AIM Euroland Growth Fund(4) Trademark--is distributed nationwide, and
AIM Mid Cap Opportunities Fund AIM European Development Fund AIM today is the 10th-largest mutual fund
AIM Select Growth Fund AIM International Equity Fund complex in the United States in assets under
AIM Small Cap Growth Fund(2) AIM Japan Growth Fund management, according to Strategic Insight,
AIM Small Cap Opportunities Fund(3) AIM Latin American Growth Fund an independent mutual fund monitor.
AIM Value Fund AIM New Pacific Growth Fund
AIM Weingarten Fund
GLOBAL GROWTH FUNDS
GROWTH & INCOME FUNDS AIM Global Aggressive Growth Fund
AIM Advisor Flex Fund AIM Global Growth Fund
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AIM Charter Fund
GLOBAL INCOME FUNDS
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AIM Intermediate Government Fund THEME FUNDS
AIM Limited Maturity Treasury Fund AIM Global Consumer Products and Services Fund
AIM Global Financial Services Fund
TAX-FREE INCOME FUNDS AIM Global Health Care Fund
AIM High Income Municipal Fund AIM Global Infrastructure Fund
AIM Municipal Bond Fund AIM Global Resources Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Telecommunications and Technology Fund(5)
AIM Tax-Free Intermediate Fund AIM Global Trends Fund(6)
</TABLE>
(1) AIM Aggressive Growth Fund reopened to new investors on November 16, 1998.
(2) AIM Small Cap Growth Fund closed to new investors on November 8, 1999. (3)
AIM Small Cap Opportunities Fund closed to new investors on November 4, 1999.
(4) On September 1, 1999, AIM Europe Growth Fund was renamed AIM Euroland Growth
Fund. Previously the fund invested in all size companies in most areas of
Europe. The fund now seeks to invest at least 65% of its assets in large-cap
companies within countries using the euro as their currency (EMU-member
countries). (5) On June 1, 1999, AIM Global Telecommunications Fund was renamed
AIM Global Telecommunications and Technology Fund. (6) Effective August 27,
1999, AIM Global Trends Fund was restructured to operate as a traditional mutual
fund. Before that date, the fund operated as a fund of funds. For more complete
information about any AIM fund(s), including sales charges and expenses, ask
your financial advisor or securities dealer for a free prospectus(es). Please
read the prospectus(es) carefully before you invest or send money. If used as
sales material after January 20, 2000, this report must be accompanied by a
current Quarterly Review of Performance for AIM Funds.
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