<PAGE> 1
ANNUAL REPORT / OCTOBER 31 1999
AIM GLOBAL RESOURCES FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
<PAGE> 2
[ COVER IMAGE ]
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OLIVE TREES: YELLOW SKY WITH SUN
BY VINCENT VAN GOGH (1835-1890, DUTCH)
PEOPLE HAVE ALWAYS DEPENDED ON THE EARTH'S RESOURCES FOR
OUR SURVIVAL AND WELL-BEING. FROM OLIVE TREES TO OIL FIELDS,
PINE FORESTS TO URANIUM MINES, THE WORLD'S RICHES ARE BEING
EXPLORED AND DEVELOPED AS NEVER BEFORE. NOW TRADING IN A
GLOBAL MARKET, NATURAL RESOURCES FROM EVERY PART OF THE WORLD
CONTINUE TO SUPPLY US WITH THE BUILDING BLOCKS OF MODERN SOCIETIES.
-------------------------------------
AIM Global Resources Fund is for shareholders who seek long-term growth of
capital through investments in companies around the world that own, develop or
explore natural resources, or that supply goods and services to such companies.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Global Resources 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 reporting period, 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 and Class C shares will differ from
that of Class A shares due to differences in sales charge structure and
expenses. Sales charges do not apply to Advisor Class shares.
o The fund's average annual total returns, including applicable sales charges,
for periods ended 9/30/99 (the most recent calendar quarter-end) are as
follows: for Class A shares, one year, 12.23%; five years, 0.43%; inception
(5/31/94), 2.22%. For Class B shares, one year, 12.21%; five years, 0.56%;
inception (5/31/94), 2.47%. For Class C shares, inception (3/1/99), 20.90%.
For Advisor Class shares, one year, 18.39%; since inception (6/1/95), 4.18%.
o Because Class C shares have been offered for less than one year (since
3/1/99), all performance figures reflect cumulative total returns that have
not yet been annualized.
o Advisor Class shares were closed to new investors as of 3/1/99. Sales
charges do not apply to Advisor Class shares.
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.
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
custody 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 Investing in a single-sector mutual fund may involve greater risk and
potential reward than investing in a more diversified fund.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The unmanaged MSCI All Country World Index tracks the performance of the
securities in more than 50 countries covered by Morgan Stanley Capital
International that are considered either a developed or emerging market.
o The unmanaged MSCI World Index is a group of global securities listed on
major world stock exchanges tracked by Morgan Stanley Capital International.
o The unmanaged Standard & Poor's Composite Index of 500 stocks (S&P 500) is
widely regarded by investors to be representative of the stock market in
general.
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 CORPORATION 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 GLOBAL RESOURCES 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 GLOBAL RESOURCES FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
AIM GLOBAL RESOURCES FUND BENEFITS FROM
RISING COMMODITY PRICES
HOW DID THE FUND PERFORM?
AIM Global Resources Fund posted strong gains for the fiscal year ended October
31, 1999. The fund's Class A and Class B shares returned 10.78% and 10.14%,
respectively. From inception on March 1, 1999, to the end of the fiscal year,
Class C shares gained 18.40%. These performance figures were calculated at net
asset value, that is, without the effect of sales charges. Advisor Class shares
posted a 11.19% return for the fiscal year. In comparison, the MSCI All Country
World Index returned 26.41% for the same period.
Net assets under management totaled $36 million on October 31.
WHAT WERE MARKET CONDITIONS LIKE DURING THE FISCAL YEAR?
Investor concern over interest rates caused U.S. financial markets to be very
volatile in 1999. In June and August, the Federal Reserve Board (the Fed) raised
interest rates in two quarter-point moves. Investors were unsure what Fed
policymakers would do at their October meeting, and the uncertainty roiled the
markets. The Fed chose to leave rates unchanged but adopted a "tightening bias,"
indicating that it may be inclined to raise rates in the future.
During the summer, the equity market experienced a temporary broadening into
value, cyclical and smaller-cap stocks, but returned to its narrow, large-cap
growth focus in the fall. Most market trends of the last few years continued
during the third quarter. The largest stocks in the S&P 500 dominated that
index's return while the remainder produced lackluster results. In fact, despite
advances by the main market indexes, most stocks underperformed during this
time.
Across the Atlantic, merger activity continued to dominate. Toward the end
of the reporting period, the European merger market topped that of the United
States for the first time. Ten European deals were announced in the third
quarter of 1999 with values of more than $10 billion each.
For most of the fiscal year Japan led Asia's recovery. Investors flocked to
Japanese securities after Japan posted two consecutive quarters of economic
growth, signaling an end to its extended recession. As Japan struggled to regain
its economic strength and foothold in the world econo my, it has done so at a
cost to the United States. The dollar/yen relationship gyrated severely during
the third quarter of 1999, nearly causing the dollar to reach a 44-month low.
HOW DID THE COMMODITY MARKET PERFORM?
Some analysts believe that the commodity market has turned the corner in the
last couple of quarters, while others maintained that the factors that crippled
energy and agriculture prices for the last two years remain in effect, and there
is not much hope for a lasting recovery. Commodities have been under pressure
since the Asian economic crisis began more than two years ago, upsetting the
balance of supply and demand. A global glut of energy and agricultural products,
combined with waning demand, sent prices on a downward spiral.
As the outlook for global markets improved during the fiscal year, commodity
prices began to rise. Shortly after the end of the fiscal year, crude oil prices
increased to more than $25 a barrel--their highest level since 1997. Major base
metals have also enjoyed a short-term spurt. Prices surged during the third
quarter of 1999 as investment money flowed into the sector. Copper and zinc hit
one-year highs, aluminum rose to its highest level in 14 months and nickel
reached an 18-month peak. Gold mining stocks received a boost at the end of
September when the price of gold soared from around $270 an ounce to a 19-month
high of $310.
HOW HAVE YOU MANAGED THE FUND?
Since we have seen a marked improvement in commodity prices, we have been
managing the fund more aggressively to take advantage of these trends. Six
months ago, we began to invest in what are called "pure commodity-price plays."
FUND'S GEOGRAPHIC ALLOCATION
Based on total net assets
As global markets recovered during the fiscal year, we increased the fund's
foreign exposure.
================================================================================
10/31/98
FOREIGN INVESTMENTS 34.8%
U.S. INVESTMENTS 61.4%
OTHER 3.8%
10/31/99
FOREIGN INVESTMENTS 46.3%
U.S. INVESTMENTS 48.8%
OTHER 4.9%
================================================================================
See important fund and index disclosures inside front cover.
AIM GLOBAL RESOURCES FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
These stocks go up when the price of a commodity goes up. For example, as oil
prices began to recover we increased our exposure to oil and gas companies. As
of October 31, the fund had approximately 52% of its total net assets in oil and
gas companies. These range from the big integrated to mid-sized exploration and
production (E&P) companies. Big oil refiners, which raced to merge last year to
brace against falling crude oil prices, have seen a sharp rebound in prices take
hold over the summer due mainly to production cuts by the key OPEC oil-producing
nations. Most of our holdings in this arena are international integrated oil
companies, but we also own oil servicers, offshore drillers and oil service
equipment companies.
Conversely, we have been selling defensive holdings, such as building
materials and pipeline companies, and using the proceeds to add to the fund's
pure-commodity exposure. Following AIM's disciplined earnings-momentum strategy,
we will hold these stocks until the earnings tell us to do otherwise.
As global markets recovered during the fiscal year, we increased the fund's
foreign exposure. As of October 31, foreign companies accounted for
approximately 45% of the fund's net assets, up from 34.8% a year ago.
WHAT WERE SOME STRONG PERFORMERS?
The fund's second largest holding is Inco, the world's largest producer of
nickel. The price of nickel has increased 100% during the past year, jumping
from $1.80 a pound to $3.65 a pound. As a result, Inco's stock price has
doubled. Demand for primary metals continues to grow as living standards around
the world improve, not only in developed nations, but also in emerging markets,
especially those of Asia.
Anderson Exploration, a mid-sized E&P company in Canada, has benefited from
the recent bounce in oil prices. Anderson's stock price doubled during the
fiscal year mainly due to strengthening oil prices, higher natural gas prices
and strong operating performance. Stocks of smaller E&P companies tend to go up
dramatically when oil prices rise because these companies get most of their
earnings from selling barrels of oil instead of refining or marketing. On the
flip side, when the commodity price goes down, these companies will suffer more
because they are not integrated.
Fund holding Pohang Iron & Steel in Korea is one of the cheapest makers of
steel in the world. The company's stock price was hit hard when the steel market
collapsed and when Asian markets took a downturn during last year's financial
crisis. Since July, however, the stock has gone from $10 to $35.
WHAT IS YOUR OUTLOOK FOR THE FUTURE?
Shortly after the end of the fiscal year, Fed policymakers increased short-term
interest rates by a quarter of a percentage point, but shifted to a neutral
bias, indicating that they may not raise rates again for the rest of the year.
We believe that this move may improve investor confidence in the near future
since it means that the Fed is serious about heading off inflationary pressures.
The outlook for global markets is strong and it is getting stronger every
day. Domestically, the economy continues to grow at a healthy clip, inflation is
low and the country is enjoying a budget surplus. Since commodity prices are
directly correlated to the strength of global markets, this scenario should bode
well for natural resources stocks. Although market sectors will always go in and
out of favor, we believe that investors may begin to recognize the value of
natural resources stocks. Commodity-related securities are a good way to
diversify investment portfolios as they are among the only investment vehicles
not directly or indirectly tied to equity market performance.
PORTFOLIO COMPOSITION
As of 10/31/99, based on total net assets
<TABLE>
<CAPTION>
====================================================================================================================================
TOP 10 HOLDINGS TOP 10 INDUSTRIES TOP 10 COUNTRIES
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Total Fina S.A.-ADR (France) 5.52% 1. Oil (International Integrated) 15.96% 1. United States 48.79%
2. Inco Ltd. (Canada) 3.42 2. Oil & Gas (Exploration & Production) 15.11 2. Canada 20.80
3. Cominco Ltd. (Canada) 2.90 3. Oil & Gas (Drilling & Equipment) 13.16 3. France 8.61
4. Reynolds Metals Co. (U.S.) 2.55 4. Metals Mining 10.69 4. United Kingdom 4.62
5. Royal Dutch Petroleum Co.- 2.40 5. Paper & Forest Products 9.11 5. Germany 2.49
New York Shares-ADR (Netherlands)
6. Atlantic Richfield Co. (U.S.) 2.33 6. Oil (Domestic Integrated) 7.36 6. Netherlands 2.40
7. Rio Tinto PLC (U.K.) 2.32 7. Containers & Packaging (Paper) 4.39 7. Italy 2.10
8. Conoco Inc. Class B (U.S.) 2.13 8. Iron & Steel 2.97 8. South Korea 1.86
9. Devon Energy Corp. (U.S.) 2.13 9. Chemicals 2.89 9. Belgium 1.30
10. ENI S.p.A.-ADR (Italy) 2.11 10. Aluminum 2.55 10. Ireland 1.18
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
====================================================================================================================================
</TABLE>
See important fund and index disclosures inside front cover.
AIM GLOBAL RESOURCES FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM GLOBAL RESOURCES FUND VS. BENCHMARK INDEXES
5/31/94-10/31/99
<TABLE>
<CAPTION>
=================================================================================================
Global Resources Fund Global Resources Fund, MSCI All Country MSCI
Class A Shares Class B Shares World Index World Index
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
5/94 $10,000 $10,000 $10,000 $10,000
10/94 10,342 10,831 10,575 10,471
4/95 9,441 9,862 10,843 10,948
10/95 9,558 9,959 11,328 11,464
4/96 13,235 13,755 12,854 12,996
10/96 14,627 15,176 13,095 13,332
4/97 12,370 12,793 14,177 14,340
10/97 17,938 18,508 15,157 15,568
4/98 14,014 14,430 17,895 18,504
10/98 9,862 10,132 17,091 17,943
4/99 11,348 11,621 20,596 21,456
10/99 10,925 11,063 21,604 22,414
Past performance cannot guarantee comparable future results.
=================================================================================================
</TABLE>
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 and B shares to benchmark indexes. Use of
the indexes is intended to give you a general idea of your fund's relative
performance. It is important to understand differences between your fund and
these indexes. An index measures performance of a hypothetical portfolio. A
market index such as the MSCI All Country World Index is not managed, incurring
no sales charges, expenses or fees. If you could buy all the securities that
make up a market index, you would incur expenses that would affect your
investment's return.
Since the last reporting period, AIM Global Resources Fund has elected to
use the MSCI All Country World Index as its benchmark. This index more closely
reflects the performance of securities in which the fund invests.
The fund will no longer measure its performance against the MSCI World
Index, the index published in previous reports to shareholders. Because this is
the first reporting period since we have adopted the new index, SEC guidelines
require that we compare the fund's performance to both the old and the new
index.
AVERAGE ANNUAL TOTAL RETURNS
As of 10/31/99, including sales charges
================================================================================
CLASS A SHARES
- --------------------------------------------------------------------------------
Since Inception (5/31/94) 1.65%
5 Years 0.12
1 Year 5.48
CLASS B SHARES
- --------------------------------------------------------------------------------
Since Inception (5/31/94) 1.88%
5 Years 0.23
1 Year 5.14
CLASS C SHARES
- --------------------------------------------------------------------------------
Since Inception (3/1/99) 17.40%*
* Cumulative total return that has not yet been annualized.
ADVISOR CLASS**
- --------------------------------------------------------------------------------
Since Inception (6/1/95) 3.42%
1 Year 11.19
** Advisor Class shares were closed to new investors on March 1, 1999. Sales
charges do not apply.
================================================================================
Fund performance shown in the chart includes expenses and management fees. Class
A share performance reflects deduction of the maximum sales charge; Class B and
Class C share performance reflects deduction of the applicable contingent
deferred sales charge. For fund data performance calculations and descriptions
of indexes cited on this page, please refer to the inside front cover.
AIM GLOBAL RESOURCES FUND
4
<PAGE> 7
ANNUAL REPORT / FOR CONSIDERATION
FIVE STEPPING STONES TO A
MORE PROSPEROUS RETIREMENT
A comfortable retirement is within your reach. But you will need a practical
investment plan to get there. Consider the five steps described here and talk
them over with your financial advisor. He or she can help you devise a plan and
choose investments suited to your unique circumstances.
1. IF YOU HAVE A 401(k) PLAN, CONTRIBUTE TO IT--AND MAKE THE MOST OF
EMPLOYER MATCHING. If your employer matches 401(k) contributions, contribute at
least enough to maximize the company's contribution. If the company match is 5%
of your salary, contribute at least 5% of your pay yourself. From your
standpoint, the employer contribution is "free" money.
2. CONTRIBUTE TO AN IRA TOO. Even if you cannot deduct an IRA contribution,
you can enjoy an IRA's tax-deferred compounding. And don't forget the added
advantage of the spousal IRA.
3. DIVERSIFY! Asset diversification helps manage risk because different
types of assets behave differently. If you put your retirement assets into
mutual funds, consider buying more than one type of fund.
4. IF YOU HAVE TIME, INVEST AGGRESSIVELY. Historically, small-company stocks
have provided the highest returns. They can be volatile in the short term, but
if you can be patient, consider including aggressive small-company growth funds
in your portfolio.
5. START EARLY AND DON'T STOP! The advantages of an early start are hard to
overstate, as you can see in the chart below.
AN EARLY START PAYS OFF
FOR 401(k) OR IRA INVESTORS
INVESTOR A
o Starts Early: at Age 25
o Invests Less: $2,000 a year for a total of $80,000
o Accumulates More by Age 65: $885,183
INVESTOR B
o Starts Late: at Age 40
o Invests More: $4,000 a year for a total of $100,000
o Accumulates Less by Age 65: $393,388
Assumes annual return of 10%. For comparison, Standard & Poor's Composite Index
of 500 Stocks (S&P 500) had an average annual total return of 13.57% for the
50-year period 12/31/48-12/31/98. The S&P 500 is a group of unmanaged securities
widely regarded as representative of the stock market in general. Income taxes
will be due when you make withdrawals from your 401(k) or IRA.
AIM GLOBAL RESOURCES FUND
5
<PAGE> 8
SCHEDULE OF INVESTMENTS
October 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
DOMESTIC COMMON STOCKS & OTHER EQUITY
INTERESTS-48.79%
ALUMINUM-2.55%
Reynolds Metals Co. 15,200 $ 918,650
- -------------------------------------------------------------
CHEMICALS-1.64%
Du Pont (E.I.) de Nemours & Co. 4,669 300,838
- -------------------------------------------------------------
Solutia, Inc. 16,800 288,750
- -------------------------------------------------------------
589,588
- -------------------------------------------------------------
CONTAINERS & PACKAGING (PAPER)-3.21%
Gaylord Container Corp.-Class A(a) 64,500 362,812
- -------------------------------------------------------------
Smurfit-Stone Container Corp.(a) 14,300 309,237
- -------------------------------------------------------------
Temple-Inland, Inc. 8,300 482,437
- -------------------------------------------------------------
1,154,486
- -------------------------------------------------------------
GOLD & PRECIOUS METALS MINING-1.54%
Stillwater Mining Co.(a) 27,550 554,444
- -------------------------------------------------------------
MANUFACTURING (SPECIALIZED)-0.88%
USEC Inc. 34,800 315,375
- -------------------------------------------------------------
METALS MINING-1.05%
Freeport-McMoRan Copper & Gold,
Inc.-Class B(a) 22,700 378,806
- -------------------------------------------------------------
NATURAL GAS-1.44%
Enron Corp. 13,000 519,187
- -------------------------------------------------------------
OIL & GAS (DRILLING & EQUIPMENT)-8.81%
Baker Hughes, Inc. 12,700 354,806
- -------------------------------------------------------------
BJ Services Co.(a) 16,600 569,587
- -------------------------------------------------------------
Cooper Cameron Corp.(a) 10,300 398,481
- -------------------------------------------------------------
ENSCO International, Inc. 29,300 567,688
- -------------------------------------------------------------
Oceaneering International, Inc.(a) 20,500 278,031
- -------------------------------------------------------------
RPC, Inc. 7,200 49,950
- -------------------------------------------------------------
Schlumberger Ltd. 7,500 454,219
- -------------------------------------------------------------
Smith International, Inc.(a) 10,500 362,906
- -------------------------------------------------------------
Veritas DGC, Inc.(a) 9,700 136,406
- -------------------------------------------------------------
3,172,074
- -------------------------------------------------------------
OIL & GAS (EXPLORATION & PRODUCTION)-9.28%
Apache Corp. 11,700 456,300
- -------------------------------------------------------------
Barrett Resources Corp.(a) 20,600 691,388
- -------------------------------------------------------------
Devon Energy Corp. 19,700 765,838
- -------------------------------------------------------------
Triton Energy Ltd.(a) 33,900 561,469
- -------------------------------------------------------------
Union Pacific Resources Group, Inc. 24,700 358,150
- -------------------------------------------------------------
Vastar Resources, Inc. 8,600 507,938
- -------------------------------------------------------------
3,341,083
- -------------------------------------------------------------
OIL (DOMESTIC INTEGRATED)-7.36%
Amerada Hess Corp. 8,300 476,213
- -------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
OIL (DOMESTIC INTEGRATED)-(CONTINUED)
Atlantic Richfield Co. 9,000 $ 838,688
- -------------------------------------------------------------
Conoco, Inc.-Class B 28,326 768,343
- -------------------------------------------------------------
USX-Marathon Group 19,400 565,025
- -------------------------------------------------------------
2,648,269
- -------------------------------------------------------------
OIL (INTERNATIONAL INTEGRATED)-4.52%
Chevron Corp. 4,200 383,513
- -------------------------------------------------------------
Exxon Corp. 4,100 303,656
- -------------------------------------------------------------
Mobil Corp. 5,600 540,400
- -------------------------------------------------------------
Texaco, Inc. 6,500 398,938
- -------------------------------------------------------------
1,626,507
- -------------------------------------------------------------
PAPER & FOREST PRODUCTS-6.51%
Boise Cascade Corp. 10,800 384,750
- -------------------------------------------------------------
Georgia-Pacific Group 14,900 591,344
- -------------------------------------------------------------
International Paper Co. 5,200 273,650
- -------------------------------------------------------------
Weyerhaeuser Co. 11,600 692,375
- -------------------------------------------------------------
Willamette Industries, Inc. 9,700 403,156
- -------------------------------------------------------------
2,345,275
- -------------------------------------------------------------
Total Domestic Common Stocks &
Other Equity Interests (Cost
$18,488,926) 17,563,744
- -------------------------------------------------------------
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-46.29%
BELGIUM-1.30%
Solvay S.A. (Chemicals-Diversified) 6,100 468,157
- -------------------------------------------------------------
CANADA-20.80%
Alliance Forest Products Inc. (Paper &
Forest Products)(a) 40,200 457,346
- -------------------------------------------------------------
Anderson Exploration Ltd. (Oil &
Gas-Exploration & Production)(a) 42,900 552,166
- -------------------------------------------------------------
Berkley Petroleum Corp. (Oil &
Gas-Exploration & Production)(a) 74,200 655,165
- -------------------------------------------------------------
Cameco Corp. (Metals Mining) 21,400 361,197
- -------------------------------------------------------------
Canadian Occidental Petroleum Ltd.
(Oil & Gas- Exploration &
Production) 23,700 463,601
- -------------------------------------------------------------
Cominco Ltd. (Metals Mining) 59,100 1,043,673
- -------------------------------------------------------------
EdperBrascan Corp.-Class A
(Conglomerates) 27,819 373,175
- -------------------------------------------------------------
Inco Ltd. (Metals Mining)(a) 61,200 1,230,401
- -------------------------------------------------------------
Nexfor Inc. (Paper & Forest Products) 94,100 476,156
- -------------------------------------------------------------
NOVA Chemicals Corp. (Natural Gas) 16,900 332,307
- -------------------------------------------------------------
Placer Dome, Inc. (Gold & Precious
Metals Mining) 29,700 360,113
- -------------------------------------------------------------
Precision Drilling Corp. (Oil &
Gas-Drilling & Equipment)(a) 29,100 674,756
- -------------------------------------------------------------
</TABLE>
6
<PAGE> 9
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
CANADA-(CONTINUED)
Suncor Energy, Inc. (Oil-International
Integrated) 13,200 $ 507,451
- -------------------------------------------------------------
7,487,507
- -------------------------------------------------------------
FRANCE-8.61%
Air Liquide S.A. (Chemicals-Specialty) 3,600 554,851
- -------------------------------------------------------------
Total Fina S.A.-ADR (Oil-International
Integrated) 29,823 1,988,826
- -------------------------------------------------------------
Bouygues Offshore S.A. (Oil &
Gas-Drilling & Equipment) 29,200 554,800
- -------------------------------------------------------------
3,098,477
- -------------------------------------------------------------
GERMANY-2.49%
BASF A.G. (Chemicals-Diversified) 9,900 445,254
- -------------------------------------------------------------
Bayer A.G. (Chemicals) 11,000 450,172
- -------------------------------------------------------------
895,426
- -------------------------------------------------------------
IRELAND-1.18%
Jefferson Smurfit Group PLC-ADR
(Containers & Packaging-Paper) 16,500 424,875
- -------------------------------------------------------------
ITALY-2.10%
ENI S.p.A-ADR (Oil-International
Integrated) 12,900 757,875
- -------------------------------------------------------------
NETHERLANDS-2.40%
Royal Dutch Petroleum Co.-New York
Shares-ADR (Oil-International
Integrated) 14,400 863,100
- -------------------------------------------------------------
NORWAY-0.93%
Petroleum Geo-Services ASA-ADR (Oil &
Gas- Drilling & Equipment)(a) 23,000 336,375
- -------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SOUTH KOREA-1.86%
Pohang Iron & Steel Co. Ltd.-ADR (Iron
& Steel) 20,100 $ 670,838
- -------------------------------------------------------------
UNITED KINGDOM-4.62%
Corus Group PLC-ADR (Iron & Steel) 20,700 399,769
- -------------------------------------------------------------
Enterprise Oil PLC (Oil &
Gas-Exploration & Production) 60,000 427,137
- -------------------------------------------------------------
Rio Tinto PLC (Metals Mining) 48,800 835,216
- -------------------------------------------------------------
1,662,122
- -------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$14,792,259) 16,664,752
- -------------------------------------------------------------
MONEY MARKET FUNDS-3.96%
STIC Liquid Assets Portfolio(b) 713,041 713,041
- -------------------------------------------------------------
STIC Prime Portfolio(b) 713,041 713,041
- -------------------------------------------------------------
Total Money Market Funds (Cost
$1,426,082) 1,426,082
- -------------------------------------------------------------
TOTAL INVESTMENTS-99.04% 35,654,578
- -------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-0.96% 343,910
- -------------------------------------------------------------
NET ASSETS-100.00% $35,998,488
- -------------------------------------------------------------
</TABLE>
Investment Abbreviation:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a)Non-income producing security.
(b)The security shares the same investment advisor as the Fund.
See Notes to Financial Statements.
7
<PAGE> 10
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $34,707,267) $35,654,578
- ------------------------------------------------------------
Receivables for:
Investments sold 635,103
- ------------------------------------------------------------
Fund shares sold 5,388
- ------------------------------------------------------------
Dividends and interest 29,032
- ------------------------------------------------------------
Other assets 17,888
- ------------------------------------------------------------
Total assets 36,341,989
- ------------------------------------------------------------
LIABILITIES:
Payables for fund shares reacquired 278,037
- ------------------------------------------------------------
Accrued distribution fees 7,803
- ------------------------------------------------------------
Accrued administrative services fees 4,247
- ------------------------------------------------------------
Accrued transfer agent fees 13,594
- ------------------------------------------------------------
Accrued trustees' fees 4,451
- ------------------------------------------------------------
Accrued operating expenses 35,369
- ------------------------------------------------------------
Total liabilities 343,501
- ------------------------------------------------------------
Net assets applicable to shares outstanding $35,998,488
============================================================
NET ASSETS:
Class A $15,664,324
============================================================
Class B $20,018,869
============================================================
Class C $ 40,559
============================================================
Advisor Class $ 274,736
============================================================
SHARES OUTSTANDING, $0.01 PAR VALUE PER SHARE:
Class A 1,292,031
============================================================
Class B 1,691,309
============================================================
Class C 3,427
============================================================
Advisor Class 22,293
============================================================
Class A:
Net asset value and redemption price per
share $ 12.12
- ------------------------------------------------------------
Offering price per share:
(Net asset value of $12.12 divided by
95.25%) $ 12.72
============================================================
Class B:
Net asset value and offering price per share $ 11.84
============================================================
Class C:
Net asset value and offering price per share $ 11.84
============================================================
Advisor Class:
Net asset value, redemption and offering
price per share $ 12.32
============================================================
</TABLE>
STATEMENT OF OPERATIONS
For the year ended October 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $48,007 foreign withholding
tax) $ 873,103
- ------------------------------------------------------------
Interest 97,061
- ------------------------------------------------------------
Securities lending 20,468
- ------------------------------------------------------------
Total investment income 990,632
- ------------------------------------------------------------
EXPENSES:
Advisory and administrative fees 439,387
- ------------------------------------------------------------
Accounting services fees 24,486
- ------------------------------------------------------------
Custodian fees 13,573
- ------------------------------------------------------------
Distribution fees -- Class A 86,740
- ------------------------------------------------------------
Distribution fees -- Class B 239,305
- ------------------------------------------------------------
Distribution fees -- Class C 406
- ------------------------------------------------------------
Printing fees 101,444
- ------------------------------------------------------------
Trustees' fees 11,563
- ------------------------------------------------------------
Transfer agent fees -- Class A 62,751
- ------------------------------------------------------------
Transfer agent fees -- Class B 86,561
- ------------------------------------------------------------
Transfer agent fees -- Class C 147
- ------------------------------------------------------------
Transfer agent fees -- Advisor 13,940
- ------------------------------------------------------------
Other 61,392
- ------------------------------------------------------------
Total expenses 1,141,695
- ------------------------------------------------------------
Less: Expenses paid indirectly (278)
- ------------------------------------------------------------
Fees waived by advisor (135,288)
- ------------------------------------------------------------
Net expenses 1,006,129
- ------------------------------------------------------------
Net investment income (loss) (15,497)
- ------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES AND FOREIGN CURRENCIES:
Net realized gain (loss) from:
Investment securities (1,213,755)
- ------------------------------------------------------------
Foreign currencies 3,341
- ------------------------------------------------------------
(1,210,414)
- ------------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of:
Investment securities 5,873,629
- ------------------------------------------------------------
Foreign currencies (112)
- ------------------------------------------------------------
5,873,517
- ------------------------------------------------------------
Net gain from investment securities and
foreign currencies 4,663,103
- ------------------------------------------------------------
Net increase in net assets resulting from
operations $ 4,647,606
============================================================
</TABLE>
See Notes to Financial Statements.
8
<PAGE> 11
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 (loss) $ (15,497) $ (912,829)
- -------------------------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies (1,210,414) (21,878,975)
- -------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities and foreign currencies 5,873,517 (39,191,661)
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 4,647,606 (61,983,465)
- -------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A -- (602,063)
- -------------------------------------------------------------------------------------------
Class B -- (769,604)
- -------------------------------------------------------------------------------------------
Advisor Class -- (57,919)
- -------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains:
Class A -- (1,584,312)
- -------------------------------------------------------------------------------------------
Class B -- (2,025,190)
- -------------------------------------------------------------------------------------------
Advisor Class -- (152,412)
- -------------------------------------------------------------------------------------------
Share transactions-net:
Class A (5,463,882) (23,633,558)
- -------------------------------------------------------------------------------------------
Class B (11,256,193) (21,986,110)
- -------------------------------------------------------------------------------------------
Class C 43,424 --
- -------------------------------------------------------------------------------------------
Advisor Class (5,519,490) (5,331,917)
- -------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (17,548,535) (118,126,550)
- -------------------------------------------------------------------------------------------
Net assets:
Beginning of period 53,547,023 171,673,573
- -------------------------------------------------------------------------------------------
End of period $ 35,998,488 $ 53,547,023
===========================================================================================
Net assets consist of:
Shares of beneficial interest $ 58,323,182 $ 80,825,848
- -------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities and foreign currencies (23,271,715) (22,352,329)
- -------------------------------------------------------------------------------------------
Unrealized appreciation (depreciation) of investment
securities and foreign currencies 947,021 (4,926,496)
- -------------------------------------------------------------------------------------------
$ 35,998,488 $ 53,547,023
===========================================================================================
</TABLE>
See Notes to Financial Statements.
9
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS
October 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Global Resources 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 long-term growth of capital. The Fund
invests substantially all of its investable assets in Global Resources Portfolio
(the "Portfolio"). The Portfolio is organized as a Delaware business trust which
is registered under the 1940 Act as an open-end management investment company.
The Portfolio has investment objectives, policies and limitations
substantially identical to those of the Fund. Therefore, the financial
statements of the Fund and Portfolio have been presented on a consolidated
basis, and represent all activities of both the Fund and Portfolio. Through
October 31, 1999, all of the shares of beneficial interest of the Portfolio were
owned by either the Fund or INVESCO (NY) Asset Management, Inc., which has a
nominal ($100) investment in the Portfolio.
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 and the Portfolio 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 increased by
$15,497, undistributed net realized gains increased by $291,028 and paid-in
capital decreased by $306,525 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 reclassification 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
10
<PAGE> 13
(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
$23,240,307 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, through 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 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 Portfolio may enter into a foreign currency contract to
attempt to minimize the risk to the Portfolio from adverse changes in the
relationship between currencies. The Portfolio 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 Portfolio 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. 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.
G. 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 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 fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
In addition, the Portfolio's policy of concentrating its investments in
companies in the natural resources industry subjects the Portfolio to
greater risk than a fund that is more diversified.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Fund's and the Portfolio's investment
manager and administrator. INVESCO Asset Management Limited is the Fund's and
the Portfolio's subadvisor. The Fund pays AIM administration fees at an
annualized rate of 0.25% of the Fund's average daily net assets. The Portfolio
pays AIM investment management and administration fees at an annual rate of
0.725% on the first $500 million of the Portfolio's average daily net assets,
plus 0.70% on the next $500 million of the Portfolio's average daily net assets,
plus 0.675% on the next $500 million of the Portfolio's average daily net
assets, plus 0.65% on the Portfolio'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
$135,288.
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 and the Portfolio. Prior to July 1,
1999, AIM was the pricing and accounting agent for the Fund and the Portfolio.
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 $24,486 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 $160,230 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 year ended October 31, 1999, the Class A, Class B and Class C
shares paid AIM Distributors $86,740, $239,305 and $406, respectively, as
compensation under the Plans.
11
<PAGE> 14
AIM Distributors received commissions of $10,174 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 $0 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 $278 under expense offset arrangements. The effect of the
above arrangements resulted in a reduction of the Fund's total expenses of $278
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 $2,101 with a weighted average interest rate of
5.5%. Interest expense for the Fund for the year ended October 31, 1999 was
$116.
NOTE 5-PORTFOLIO SECURITIES LOANED
At October 31, 1999, securities with an aggregate value of $2,312,119 were on
loan to brokers. The loans were secured by cash collateral of $2,358,361
received by the Portfolio. For the year ended October 31, 1999, the Portfolio
received fees of $20,468 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 Portfolio during the year ended October 31, 1999 was
$54,131,709 and $75,745,779, 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 $ 3,714,231
- -----------------------------------------------------------
Aggregate unrealized appreciation
(depreciation) of investment securities (2,798,328)
- -----------------------------------------------------------
Net unrealized appreciation of investment
securities $ 915,903
===========================================================
Cost of investments for tax purposes is $34,738,675
</TABLE>
12
<PAGE> 15
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 1,483,872 $ 16,786,501 11,040,421 $157,454,416
- --------------------------------------------------------------------------------------------------------------------
Class B 623,453 7,240,416 1,539,841 23,469,862
- --------------------------------------------------------------------------------------------------------------------
Class C* 10,161 124,881 -- --
- --------------------------------------------------------------------------------------------------------------------
Advisor Class 40,141 464,770 1,211,598 19,441,802
- --------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class A -- -- 107,234 1,988,098
- --------------------------------------------------------------------------------------------------------------------
Class B -- -- 132,618 2,421,607
- --------------------------------------------------------------------------------------------------------------------
Advisor Class -- -- 11,203 209,263
- --------------------------------------------------------------------------------------------------------------------
Reacquired:
Class A (1,968,466) (22,250,382) (12,759,254) (183,076,072)
- --------------------------------------------------------------------------------------------------------------------
Class B (1,629,584) (18,496,610) (3,237,031) (47,877,579)
- --------------------------------------------------------------------------------------------------------------------
Class C* (6,734) (81,457) -- --
- --------------------------------------------------------------------------------------------------------------------
Advisor Class (477,178) (5,984,260) (1,479,078) (24,982,982)
- --------------------------------------------------------------------------------------------------------------------
(1,924,335) $(22,196,141) (3,432,448) $(50,951,585)
====================================================================================================================
</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(a) 1998(a) 1997(a) 1996(a) 1995
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.95 $ 20.65 $ 17.43 $ 11.44 $ 12.41
- -----------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) 0.02 (0.11)(b) (0.25) (0.24) 0.04(c)
- -----------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments 1.15 (8.91) 4.08 6.28 (0.98)
- -----------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations 1.17 (9.02) 3.83 6.04 (0.94)
- -----------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
From net investment income -- (0.19) -- (0.04) (0.03)
- -----------------------------------------------------------------------------------------------------------------
From net realized gain on investments -- (0.49) (0.61) (0.01) --
- -----------------------------------------------------------------------------------------------------------------
Total distributions -- (0.68) (0.61) (0.05) (0.03)
- -----------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 12.12 $ 10.95 $ 20.65 $ 17.43 $ 11.44
=================================================================================================================
Total return(d) 10.68% (45.02)% 22.64% 53.04% (7.58)%
=================================================================================================================
Ratios and supplemental data:
Net assets, end of period (in 000's) $15,664 $19,463 $69,975 $48,729 $12,598
=================================================================================================================
Ratio of net investment income (loss) to average net assets:
With fee waivers 0.19%(e) 0.75)% (1.41)% (1.55)% 0.41%
- -----------------------------------------------------------------------------------------------------------------
Without fee waivers (0.11)%(e) (1.06)% (1.51)% (1.65)% (0.69)%
=================================================================================================================
Ratio of expenses to average net assets:
With fee waivers 2.00%(e) 1.98% 2.03% 2.20% 2.37%
- -----------------------------------------------------------------------------------------------------------------
Without fee waivers 2.30%(e) 2.29% 2.13% 2.30% 3.47%
=================================================================================================================
Portfolio turnover rate 123% 201% 321% 94% 87%
=================================================================================================================
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Before reimbursement the net investment loss per share would have been
increased by $0.04.
(c) Before reimbursement the net investment income (loss) per share would have
been reduced (increased) by $0.14.
(d) Total return does not include sales charges and is not annualized for
periods less than one year.
(e) Ratios are based on average net assets of $17,347,953.
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 B
-----------------------------------------------------
YEAR ENDED OCTOBER 31,
-----------------------------------------------------
1999(a) 1998(a) 1997(a) 1996(a) 1995
--------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.75 $ 20.37 $ 17.29 $ 11.36 $ 12.38
- -------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) (0.04) (0.18)(b) (0.33) (0.31) (0.02)(c)
- -------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments 1.13 (8.76) 4.02 6.25 (0.98)
- -------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations 1.09 (8.94) 3.69 5.94 (1.00)
- -------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
From net investment income -- (0.19) -- -- (0.02)
- -------------------------------------------------------------------------------------------------------------------
From net realized gain on investments -- (0.49) (0.61) (0.01) --
- -------------------------------------------------------------------------------------------------------------------
Total distributions -- (0.68) (0.61) (0.01) (0.02)
- -------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 11.84 $ 10.75 $ 20.37 $ 17.29 $ 11.36
===================================================================================================================
Total return(d) 10.14% (45.25)% 21.99% 52.39% (8.05)%
===================================================================================================================
Ratios and supplemental data:
Net assets, end of period (in 000's) $20,019 $28,996 $86,812 $57,749 $13,978
===================================================================================================================
Ratio of net investment income (loss) to average net assets:
With fee waivers (0.31)%(e) (1.25)% (1.91)% (2.05)% (0.09)%
===================================================================================================================
Without fee waivers (0.61)%(e) (1.56)% (2.01)% (2.15)% (1.19)%
===================================================================================================================
Ratio of expenses to average net assets:
With fee waivers 2.50%(e) 2.48% 2.53% 2.70% 2.87%
===================================================================================================================
Without fee waivers 2.80%(e) 2.79% 2.63% 2.80% 3.97%
===================================================================================================================
Portfolio turnover rate 123% 201% 321% 94% 87%
===================================================================================================================
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Before reimbursement the net investment loss per share would have been
increased by $0.04.
(c) Before reimbursement the net investment income (loss) per share would have
been reduced (increased) by $0.13.
(d) Total return does not include sales charges and is not annualized for
periods less than one year.
(e) Ratios are based on average net assets of $23,930,469.
14
<PAGE> 17
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
------------------- --------------------------------------------------------------
MARCH 1, 1999 YEAR ENDED OCTOBER 31, JUNE 1, 1995
TO ------------------------------------------ TO
OCTOBER 31, 1999(a) 1999(a) 1998(a) 1997(a) 1996(a) OCTOBER 31, 1995
------------------- --------- ------- ------- ------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $10.00 $11.08 $ 20.80 $ 17.47 $11.47 $11.45
- ---------------------------------------------------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) (0.03) 0.08 (0.03)(b) (0.14) (0.17) 0.11(c)
- ---------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss)
on investments 1.87 1.16 (9.01) 4.08 6.28 (0.09)
- ---------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from
investment operations 1.84 1.24 (9.04) 3.94 6.11 0.02
- ---------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
From net investment income -- -- (0.19) -- (0.10) --
- ---------------------------------------------------------------------------------------------------------------------------------
From net realized gain on investments -- -- (0.49) (0.61) (0.01) --
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions -- -- (0.68) (0.61) (0.11) --
- ---------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $11.84 $12.32 $ 11.08 $ 20.80 $17.47 $11.47
=================================================================================================================================
Total return(d) 18.40% 11.19% (44.79)% 23.23% 53.76% 0.17%
=================================================================================================================================
Ratios and supplemental data:
Net assets, end of period (in 000's) $ 41 $ 275 $ 5,089 $14,886 $5,502 $ 95
=================================================================================================================================
Ratio of net investment income (loss) to
average net assets:
With fee waivers (0.31)%(e) 0.69%(f) (0.25)% (0.91)% (1.05)% 0.91%(g)
=================================================================================================================================
Without fee waivers (0.61)%(e) 0.39%(f) (0.56)% (1.01)% (1.15)% (0.19)%(g)
=================================================================================================================================
Ratio of expenses to average net assets:
With fee waivers 2.50%(e) 1.50%(f) 1.48% 1.53% 1.70% 1.87%(g)
=================================================================================================================================
Without fee waivers 2.80%(e) 1.80%(f) 1.79% 1.63% 1.80% 2.97%(g)
=================================================================================================================================
Portfolio turnover rate 123% 123% 201% 321% 94% 87%
=================================================================================================================================
</TABLE>
(a) These selected per share data were calculated based upon average shares
outstanding during the period.
(b) Before reimbursement the net investment loss per share would have been
increased by $0.04.
(c) Before reimbursement the net investment income (loss) per share would have
been reduced (increased) by $0.12.
(d) Total return does not include sales charges and is not annualized for
periods less than one year.
(e) Ratios are annualized and based on average net assets of $60,471.
(f) Ratios are based on average net assets of $3,853,899.
(g) 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.
15
<PAGE> 18
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders of AIM Global Resources 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 Global Resources 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
16
<PAGE> 19
<TABLE>
<CAPTION>
BOARD OF TRUSTEES OFFICERS OFFICE OF THE FUND
<S> <C> <C>
C. Derek Anderson Robert H. Graham 11 Greenway Plaza
President, Plantagenet Capital Chairman and President Suite 100
Management, LLC (an investment Houston, TX 77046
partnership); Chief Executive Officer, Dana R. Sutton
Plantagenet Holdings, Ltd. Vice President and Treasurer INVESTMENT MANAGER
(an investment banking firm)
Samuel D. Sirko A I M Advisors, Inc.
Frank S. Bayley Vice President and Secretary 11 Greenway Plaza
Partner, law firm of Suite 100
Baker & McKenzie Melville B. Cox Houston, TX 77046
Vice President
Robert H. Graham TRANSFER AGENT
President and Chief Executive Officer, Gary T. Crum
A I M Management Group Inc. Vice President A I M Fund Services, Inc.
P.O. Box 4739
Ruth H. Quigley Carol F. Relihan Houston, TX 77210-4739
Private Investor Vice President
CUSTODIAN
Mary J. Benson
Assistant Vice President and State Street Bank and Trust Company
Assistant Treasurer 225 Franklin Street
Boston, MA 02110
Sheri Morris
Assistant Vice President and COUNSEL TO THE FUND
Assistant Treasurer
Kirkpatrick & Lockhart LLP
Nancy L. Martin 1800 Massachusetts Avenue, N.W.
Assistant Secretary Washington, D.C. 20036-1800
Ofelia M. Mayo COUNSEL TO THE TRUSTEES
Assistant Secretary
Paul, Hastings, Janofsky & Walker LLP
Kathleen J. Pflueger Twenty Third Floor
Assistant Secretary 555 South Flower Street
Los Angeles, CA 90071
DISTRIBUTOR
A I M Distributors, Inc.
11 Greenway Plaza
Suite 100
Houston, TX 77046
AUDITORS
PricewaterhouseCoopers LLP
160 Federal St.
Boston, MA 02110
</TABLE>
<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
AIM Aggressive Growth Fund(1) AIM Money Market Fund provided leadership in the
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund mutual fund industry since 1976
AIM Capital Development Fund and managed approximately $120
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS billion in assets for more than
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund 6.4 million shareholders,
AIM Large Cap Growth Fund AIM Asian Growth Fund including individual investors,
AIM Mid Cap Equity Fund AIM Developing Markets Fund corporate clients and financial
AIM Mid Cap Growth Fund AIM Euroland Growth Fund(4) institutions, as of September
AIM Mid Cap Opportunities Fund AIM European Development Fund 30, 1999.
AIM Select Growth Fund AIM International Equity Fund The AIM Family of Funds
AIM Small Cap Growth Fund(2) AIM Japan Growth Fund --Registered Trademark-- is
AIM Small Cap Opportunities Fund(3) AIM Latin American Growth Fund distributed nationwide, and AIM
AIM Value Fund AIM New Pacific Growth Fund today is the 10th-largest mutual
AIM Weingarten Fund fund complex in the United
GLOBAL GROWTH FUNDS States in assets under
GROWTH & INCOME FUNDS AIM Global Aggressive Growth Fund management, according to
AIM Advisor Flex Fund AIM Global Growth Fund Strategic Insight, an
AIM Advisor Large Cap Value Fund independent mutual fund monitor.
AIM Advisor Real Estate Fund GLOBAL GROWTH & INCOME FUNDS
AIM Balanced Fund AIM Global Growth & Income Fund
AIM Basic Value Fund AIM Global Utilities Fund
AIM Charter Fund
GLOBAL INCOME FUNDS
INCOME FUNDS AIM Emerging Markets Debt Fund
AIM Floating Rate Fund AIM Global Government Income Fund
AIM High Yield Fund AIM Global Income Fund
AIM High Yield Fund II AIM Strategic Income Fund
AIM Income Fund
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.
[AIM LOGO APPEARS HERE]
Invest with DISCIPLINE
--Registered Trademark--
A I M Distributors, Inc. GRS-AR-1
