[PIONEER LOGO]
Pioneer
America Income
Trust
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ANNUAL REPORT 12/31/98
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<PAGE>
Table of Contents
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Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 6
Schedule of Investments 9
Financial Statements 11
Notes to Financial Statements 17
Report of Independent Public Accountants 21
Trustees, Officers and Service Providers 22
The Pioneer Family of Mutual Funds 23
Retirement Plans from Pioneer 24
Programs and Services for Pioneer Shareowners 26
<PAGE>
Pioneer America Income Trust
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LETTER FROM THE CHAIRMAN 12/31/98
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Dear Shareowner,
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I am pleased to introduce this annual report for Pioneer America Income Trust,
covering the year ended December 31, 1998. On behalf of your investment team, I
thank you for your interest and this opportunity to comment on today's investing
environment.
Before moving on to review the bond market, I'd like to announce a recent
addition to the Fund's management team. We are pleased that Kenneth J. Taubes
joined us in September, bringing with him 13 years of investment experience. He
and Sherman B. Russ, who has worked with your Fund for 16 years, supervise the
team of portfolio managers and analysts responsible for the day-to-day
management of the Fund.
Economic news in the United States remained positive in 1998, with low
unemployment and no signs of inflation. The financial markets, and especially
U.S. government bonds, turned in impressive results through the end of the year.
The yield on the 30-year Treasury bond fell to historic lows, which subsequently
pushed bond prices higher and increased total returns.
Although bond returns were once again overshadowed by the returns of the overall
stock market, bonds do play a vital role in a well-balanced portfolio. Funds
that hold high-quality securities, including Pioneer America Income Trust, can
cushion some of the stock market's volatility and often provide a much needed
income component to an investor's portfolio. We suggest you discuss your
particular needs with your investment professional.
I encourage you to read the pages that follow, including the Portfolio
Management Discussion where your team reviews Fund performance. If you have any
questions, please contact your investment professional, or Pioneer at
1-800-225-6292.
Respectfully,
/s/ John F. Cogan, Jr.
- ------------------------------------
John F. Cogan, Jr.
Chairman and President
1
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Pioneer America Income Trust
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PORTFOLIO SUMMARY 12/31/98
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Portfolio Diversification
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(As a percentage of total investment portfolio)
U.S. Government Agency Obligations 53%
U.S. Treasury Obligations 42%
Short-Term Cash Equivalents 5%
Portfolio Maturity
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(Effective life as a percentage of total investment portfolio)
0-2 Years 9%
2-5 Years 18%
5-7 Years 27%
7-10 Years 27%
10-20 Years 6%
20+ Years 13%
10 Largest Holdings
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(As a percentage of long-term holdings)
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1 U.S. Treasury Bonds, 8.0%, 11/15/21 13.92%
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2 Government National Mortgage Association, 6.5%, 4/15/28 9.83
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3 Government National Mortgage Association, 7.5%, 2/15/27 8.62
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4 Government National Mortgage Association, 6.0%, 10/15/28 8.44
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5 U.S. Treasury Notes, 7.25%, 5/15/04 6.92
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6 U.S. Treasury Bonds, 7.25%, 5/15/16 6.70
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7 Government National Mortgage Association, 6.5%, 6/15/28 6.50
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8 U.S. Treasury Bonds, 9.125%, 5/15/09 4.36
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9 U.S. Treasury Bonds, 8.25%, 5/15/05 4.02
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10 U.S. Treasury Bonds, 10.375%, 11/15/09 3.32
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Fund holdings will vary for other periods
2
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Pioneer America Income Trust
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PERFORMANCE UPDATE 12/31/98 CLASS A SHARES
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Share Prices and Distributions
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Net Asset Value
per Share 12/31/98 12/31/97
$10.10 $9.93
Distributions per Share Income Short-Term Long-Term
(12/31/97 - 12/31/98) Dividends Capital Gains Capital Gains
$0.581 -- --
Investment Returns
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The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer America Income Trust at public offering price, compared to the growth of
the Lehman Brothers Government Bond Index.
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Average Annual Total Returns
(As of December 31, 1998)
Net Asset Public Offering
Period Value Price*
10 Years 7.78% 7.28%
5 Years 5.92 4.96
1 Year 7.78 2.91
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* Reflects deduction of the maximum 4.5% sales charge at the beginning of the
period and assumes reinvestment of distributions at net asset value.
[The following information was depicted as a line graph in the printed material]
Pioneer America Income Class A Lehman Brothers
12/88 9550 10000
10653 11423
12/90 11611 12420
13008 14324
12/92 13889 15357
15150 16992
12/94 14548 16418
16886 19429
12/96 17272 19966
18743 21878
12/98 20200 24033
Pioneer America Income Trust*
Lehman Brothers
Government Bond Index
The Lehman Brothers Government Bond Index is an unmanaged measure of the
performance of U.S. Treasury debt, all publicly issued debt of U.S. government
agencies and quasi-federal corporations, and corporate debt guaranteed by the
U.S. government. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
3
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Pioneer America Income Trust
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PERFORMANCE UPDATE 12/31/98 CLASS B SHARES
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Share Prices and Distributions
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Net Asset Value
per Share 12/31/98 12/31/97
$10.07 $9.90
Distributions per Share Income Short-Term Long-Term
(12/31/97 - 12/31/98) Dividends Capital Gains Capital Gains
$0.514 -- --
Investment Returns
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The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer America Income Trust, compared to the growth of the Lehman Brothers
Government Bond Index.
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Average Annual Total Returns
(As of December 31, 1998)
If If
Period Held Redeemed*
Life-of-Fund 6.45% 6.11%
(4/29/94)
1 Year 7.08 3.08
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* Reflects deduction of the maximum applicable contingent deferred sales
charge (CDSC) at the end of the period and assumes reinvestment of
distributions. The maximum CDSC of 4% declines over six years.
[The following information was depicted as a line graph in the printed material]
Pioneer America Income Class B Lehman Brothers
4/94 10000 10000
9952 9964
9978 10006
12/94 9943 10041
10395 10514
10856 11166
11034 11364
12/95 11442 11883
11197 11613
11186 11668
11338 11865
12/96 11624 12211
11516 12112
11890 12531
12188 12951
12/97 12508 13381
12632 13583
12878 13942
13422 14712
12/98 13194 14699
Pioneer America Income Trust*
Lehman Brothers
Government Bond Index
The Lehman Brothers Government Bond Index is an unmanaged measure of the
performance of U.S. Treasury debt, all publicly issued debt of U.S. government
agencies and quasi-federal corporations, and corporate debt guaranteed by the
U.S. government. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
4
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Pioneer America Income Trust
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PERFORMANCE UPDATE 12/31/98 CLASS C SHARES
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Share Prices and Distributions
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Net Asset Value
per Share 12/31/98 12/31/97
$10.07 $9.90
Distributions per Share Income Short-Term Long-Term
(12/31/97 - 12/31/98) Dividends Capital Gains Capital Gains
$0.515 -- --
Investment Returns
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The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer America Income Trust, compared to the growth of the Lehman Brothers
Government Bond Index.
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Average Annual Total Returns
(As of December 31, 1998)
If If
Period Held Redeemed*
Life-of-Fund 5.41% 5.41%
(1/31/96)
1 Year 7.09 7.09
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* Assumes reinvestment of distri-butions. The 1% contingent deferred sales
charge (CDSC) applies to redemptions made within one year of purchase.
[The following information was depicted as a line graph in the printed material]
Pioneer America Income Class C Lehman Brothers
1/96 10000 10000
9748 9714
9728 9759
9861 9924
12/96 10104 10214
10020 10131
10335 10481
10607 10832
12/97 10890 11192
10995 11361
11194 11661
11680 12306
12/98 11663 12295
Pioneer America Income Trust*
Lehman Brothers
Government Bond Index
The Lehman Brothers Government Bond Index is an unmanaged measure of the
performance of U.S. Treasury debt, all publicly issued debt of U.S. government
agencies and quasi-federal corporations, and corporate debt guaranteed by the
U.S. government. Index returns assume reinvestment of dividends and, unlike Fund
returns, do not reflect any fees, expenses or sales charges. You cannot invest
directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
5
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Pioneer America Income Trust
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PORTFOLIO MANAGEMENT DISCUSSION 12/31/98
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Pioneer America Income Trust closed its fiscal year on December 31, 1998.
Government securities posted attractive returns as stability in global economies
and financial markets began to crumble and investors were drawn to Treasurys for
their quality and liquidity. Your Fund's performance and strategies reflected
this positive environment. In addition to harvesting price gains, your Fund's
investment team took advantage of market conditions to enhance total return
potential for the future.
The following discussion with Sherman Russ, who together with Ken Taubes leads
the team responsible for the daily management of Pioneer America Income Trust,
provides a detailed account of the investment environment and strategies that
influenced performance in 1998.
Q: How did the Fund perform over the past 12 months?
A: The Fund generated both a solid total return and good income. On December
31, the 30-day SEC yield of the Fund's Class A Shares was 4.80%. As always,
throughout the year, the Fund had the highest level of quality, investing
only in securities that carry the "full faith and credit" pledge of the U.S.
government. (This guarantee does not extend to the price or yield of Fund
shares.)
For the 12 months ending December 31, Class A Shares returned 7.78%, Class B
7.08% and Class C 7.09%, all at net asset value. In comparison, the average
return of the 184 general U.S. government funds followed by Lipper, Inc.
stood at 8.07% for the same period. We were pleased with the Fund's
performance, particularly in light of the Fund's high investment standards.
Other funds in this category can invest a portion of their assets in U.S.
agency and corporate debt, foreign government issues, commercial
mortgage-backed securities and even equities. Because these securities
involve greater risk, they often provide higher returns.
6
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Pioneer America Income Trust
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Q: What was the investment environment for U.S. government securities?
A: It was an extremely positive period, particularly for Treasury issues. The
U.S. economy remained healthy and inflation stayed low. A combination of
factors, including the federal budget surplus and a high demand for Treasury
bonds, caused long-term interest rates to fall to historic lows and pushed
bond prices higher. The yield of the 10-year U.S. Treasury note declined
from 5.74% on December 31, 1997 to 4.65% on December 31, 1998. Yields of
GNMA (Government National Mortgage Association) also fell, but their decline
was less dramatic than Treasury issues.
These changes did not occur in an uninterrupted decline. In the first half
of 1998, investors focused on whether U.S. economic strength would trigger
potential inflation and provoke the Federal Reserve to raise interest rates.
In the summer, however, circumstances changed significantly. Investors
turned their attention to growing instability in many of the world's
economies and financial markets. International demand for the safety and
liquidity of U.S. Treasurys increased as investors sought refuge from
turbulent global financial markets. This "flight-to-quality" drove interest
rates significantly lower and Treasury prices higher. Ultimately, the
Federal Reserve lowered the federal funds rate three times in the fall of
1998 - from 5.50% to 4.75% - to increase liquidity, reduce volatility and
calm credit markets, both domestically and internationally.
The world's economies and financial markets began to stabilize in the fourth
quarter, giving investors a more positive outlook. As investor confidence
grew, demand for U.S. Treasurys declined, causing interest rates to rise
from their historically low levels.
Q: What strategies did you use to manage the Fund?
A: We actively managed the Fund's allocation to U.S. Treasurys and GNMAs. In
the first half of 1998, we reduced the Fund's holdings in
7
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Pioneer America Income Trust
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Portfolio management discussion 12/31/98 (continued)
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GNMAs and raised its investment in U.S. Treasurys to approximately 60% of
net assets. We maintained a minimal position in cash reserves.
The emphasis on U.S. Treasurys increased total return potential in two ways
- it maximized the benefit from the flight-to-quality and it protected the
Fund against prepayments. Unlike mortgage-backed securities, Treasurys do
not experience prepayments. Prepayments occur when a mortgage is paid off
prior to its stated maturity - an activity that typically increases as
interest rates decline and mortgage owners refinance to take advantage of
lower interest rates. When the older, higher interest rate mortgage is paid
off, its coupon no longer contributes to the Fund's income stream.
In the second half of the year, we increased holdings in GNMAs to 52% of net
assets, as their yields increased to historically high levels versus
Treasurys. We selected newly issued GNMAs to minimize the risk of
prepayments.
Q: What is your outlook for U.S. government securities over the next six
months?
A: Positive. While we do not expect interest rates to fall as dramatically as
in 1998, we think they could gradually move lower - especially short-term
interest rates. However, the past several months of global interest rate
cuts could re-energize world economies, and the Fed would not want further
cuts to over-stimulate the economy. We anticipate continued positive, but
slower, economic growth - about 2.5% versus an estimated 4% in 1998 - and
minimal inflation in the United States, since we think a slowdown in
international economies particularly Asia and Latin America - could reduce
domestic economic strength.
8
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Pioneer America Income Trust
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SCHEDULE OF INVESTMENTS 12/31/98
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Principal
Amount Value
INVESTMENT IN SECURITIES - 95.0%
U.S. Government Obligations - 42.5%
$ 5,915,000 U.S. Treasury Bonds, 8.25%, 5/15/05 $ 6,186,025
5,590,000 U.S. Treasury Bonds, 9.125%, 5/15/09 6,696,876
4,000,000 U.S. Treasury Bonds, 10.375%, 11/15/09 5,106,200
3,000,000 U.S. Treasury Bonds, 10.0%, 5/15/10 3,824,550
8,500,000 U.S. Treasury Bonds, 7.25%, 5/15/16 10,297,070
16,000,000 U.S. Treasury Bonds, 8.0%, 11/15/21 21,405,600
9,500,000 U.S. Treasury Notes, 7.25%, 5/15/04 10,644,940
4,000,000 U.S. Treasury Notes, 7.875%, 11/15/04 4,634,320
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Total U.S. Government Obligations $ 68,795,581
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U.S. Government Agency Obligations - 52.5%
716,677 Government National Mortgage Association,
10.0%, 11/15/18 to 3/15/20 $ 785,655
490,659 Government National Mortgage Association,
8.5%, 7/15/24 521,021
3,518,027 Government National Mortgage Association,
9.0%, 10/15/16 to 11/20/24 3,758,021
12,857,632 Government National Mortgage Association,
7.5%, 2/15/27 13,259,433
7,711,161 Government National Mortgage Association,
8.0%, 5/20/25 to 4/20/27 7,998,549
9,130,103 Government National Mortgage Association,
7.0%, 2/15/28 to 3/15/28 9,335,531
13,098,198 Government National Mortgage Association,
6.0%, 10/15/28 12,981,402
29,850,874 Government National Mortgage Association,
6.5%, 4/15/28 to 10/15/28 30,140,128
120,379 Government National Mortgage Association Midget,
10.0%, 1/20/03 126,473
31,462 Government National Mortgage Association Midget,
10.5%, 1/15/01 to 8/15/03 32,885
133,505 Government National Mortgage Association Midget,
9.5%, 12/15/03 138,386
2,793,325 Government National Mortgage Association Midget,
6.5%, 5/15/13 2,842,208
3,018,228 Government National Mortgage Association Midget,
6.0%, 11/15/13 3,036,156
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Total U.S. Government Agency Obligations $ 84,955,848
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The accompanying notes are an integral part of these financial statements.
9
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Pioneer America Income Trust
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SCHEDULE OF INVESTMENTS 12/31/98 (continued)
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Principal
Amount Value
TOTAL INVESTMENT IN SECURITIES
(Cost $148,939,255) $ 153,751,429
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TEMPORARY CASH INVESTMENT - 5.0%
Repurchase Agreement - 5.0%
$ 8,100,000 Credit Suisse First Boston Group, Inc., 4.75%, dated
12/31/98, repurchase price of $8,100,000 plus
accrued interest on 1/4/99, collateralized by
$8,041,000 U.S. Treasury Notes, 5.5%, 2/29/00 $ 8,100,000
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TOTAL TEMPORARY CASH INVESTMENT
(Cost $8,100,000) $ 8,100,000
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TOTAL INVESTMENT IN SECURITIES AND
TEMPORARY CASH INVESTMENT - 100%
(Cost $157,039,255) (a) (b) $ 161,851,429
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Note: The Trust's investments in mortgage-backed securities of the Government
National Mortgage Association (GNMA) are interests in separate pools of
mortgages. All separate investments in this issuer which have the same
coupon rate have been aggregated for the purpose of presentation in this
schedule of investments.
(a) At December 31, 1998, the net unrealized gain on investments based on cost
for federal income tax purposes of $157,041,359 was as follows:
Aggregate gross unrealized gain for all investments
in which there is an excess of value over tax cost $ 5,012,173
Aggregate gross unrealized loss for all investments
in which there is an excess of tax cost over value (202,103)
-----------
Net unrealized gain $ 4,810,070
===========
(b) At December 31, 1998, the Trust had a net capital loss carryforward of
$6,653,869 which will expire between 2002 and 2004 if not utilized.
Purchases and sales of securities (excluding temporary cash investments) for the
year ended December 31, 1998 aggregated $122,812,432 and $119,978,519,
respectively.
The accompanying notes are an integral part of these financial statements.
10
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Pioneer America Income Trust
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BALANCE SHEET 12/31/98
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ASSETS:
Investment in securities, at value (including temporary cash
investment of $8,100,000) (cost $157,039,255) $ 161,851,429
Cash 88,780
Receivables -
Fund shares sold 1,041,752
Interest 1,166,700
Other 3,450
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Total assets $ 164,152,111
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LIABILITIES:
Payables -
Fund shares repurchased $ 175,020
Dividends 200,131
Due to affiliates 280,979
Accrued expenses 78,197
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Total liabilities $ 734,327
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NET ASSETS:
Paid-in capital $ 165,225,388
Accumulated undistributed net investment income 36,195
Accumulated net realized loss on investments (6,655,973)
Net unrealized gain on investments 4,812,174
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Total net assets $ 163,417,784
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Net Asset Value Per Share:
(Unlimited number of shares authorized)
Class A (based on $128,924,667/12,761,765 shares) $ 10.10
=============
Class B (based on $22,602,487/2,243,798 shares) $ 10.07
=============
Class C (based on $11,890,630/1,180,664 shares) $ 10.07
=============
Maximum Offering Price:
Class A $ 10.58
=============
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
Pioneer America Income Trust
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STATEMENT OF OPERATIONS
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For the Year Ended 12/31/98
INVESTMENT INCOME:
Interest $ 10,496,117
------------
EXPENSES:
Management fees $ 773,600
Transfer agent fees
Class A 261,888
Class B 30,708
Class C 8,632
Distribution fees
Class A 331,014
Class B 157,290
Class C 65,853
Accounting 33,652
Custodian fees 36,692
Registration fees 45,346
Professional fees 52,698
Printing 21,181
Fees and expenses of nonaffiliated trustees 23,501
Miscellaneous 15,630
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Total expenses $ 1,857,685
Less management fees waived
by Pioneer Investment Management, Inc. (149,382)
Less fees paid indirectly (26,077)
------------
Net expenses $ 1,682,226
------------
Net investment income $ 8,813,891
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments $ 1,015,080
Change in net unrealized gain on investments 1,617,464
------------
Net gain on investments 2,632,544
------------
Net increase in net assets resulting from operations $ 11,446,435
============
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
Pioneer America Income Trust
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STATEMENTS OF CHANGES IN NET ASSETS
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For the Years Ended 12/31/98 and 12/31/97
<TABLE>
<CAPTION>
Year Ended Year Ended
12/31/98 12/31/97
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 8,813,891 $ 9,732,858
Net realized gain on investments 1,015,080 363,186
Change in net unrealized gain on investments 1,617,464 1,972,746
------------- -------------
Net increase in net assets resulting from operations $ 11,446,435 12,068,790
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.58 and $0.64 per share, respectively) $ (7,662,749) $ (9,003,410)
Class B ($0.51 and $0.57 per share, respectively) (792,353) (574,191)
Class C ($0.52 and $0.57 per share, respectively) (330,576) (151,208)
------------- -------------
Total distributions to shareholders$ (8,785,678) $ (9,728,809)
------------- -------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 71,663,010 $ 27,247,962
Reinvestment of distributions 6,242,716 7,358,078
Cost of shares repurchased (70,885,637) (39,480,276)
------------- -------------
Net increase (decrease) in net assets resulting from
fund share transactions $ 7,020,089 $ (4,874,236)
------------- -------------
Net increase (decrease) in net assets $ 9,680,846 $ (2,534,255)
NET ASSETS:
Beginning of year 153,736,938 156,271,193
------------- -------------
End of year (including accumulated undistributed net
investment income of $36,195 and $7,982, respectively) $ 163,417,784 $ 153,736,938
============= =============
</TABLE>
<TABLE>
<CAPTION>
'98 Shares '98 Amount '97 Shares '97 Amount
<S> <C> <C> <C> <C>
Class A
Shares sold 3,719,228 $ 37,434,949 1,872,947 $ 18,276,093
Reinvestment of distributions 553,656 5,539,806 701,123 6,834,431
Less shares repurchased (5,414,082) (54,421,651) (3,559,994) (34,576,696)
------------ ------------ ------------ ------------
Net decrease (1,141,198) $(11,446,896) (985,924) $ (9,466,172)
============ ============ ============ ============
Class B
Shares sold 1,759,137 $ 17,658,764 519,608 $ 5,065,460
Reinvestment of distributions 55,353 553,156 44,189 430,240
Less shares repurchased (775,704) (7,755,185) (339,383) (3,295,763)
------------ ------------ ------------ ------------
Net increase 1,038,786 $ 10,456,735 224,414 $ 2,199,937
============ ============ ============ ============
Class C
Shares sold 1,651,735 $ 16,569,297 402,752 $ 3,906,409
Reinvestment of distributions 14,959 149,754 9,590 93,407
Less shares repurchased (867,882) (8,708,801) (164,594) (1,607,817)
------------ ------------ ------------ ------------
Net increase 798,812 $ 8,010,250 247,748 $ 2,391,999
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
Pioneer America Income Trust
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FINANCIAL HIGHLIGHTS 12/31/98
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<TABLE>
<CAPTION>
Year Year Year Year Year
Ended Ended Ended Ended Ended
12/31/98 12/31/97 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 9.93 $ 9.77 $ 10.20 $ 9.41 $ 10.48
-------- -------- -------- -------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.58 $ 0.64 $ 0.64 $ 0.68 $ 0.66
Net realized and unrealized gain (loss) on investments 0.17 0.16 (0.43) 0.79 (1.07)
-------- -------- -------- -------- --------
Net increase (decrease) from investment operations $ 0.75 $ 0.80 $ 0.21 $ 1.47 $ (0.41)
Distributions to shareholders:
Net investment income (0.58) (0.64) (0.64) (0.68) (0.66)
-------- -------- -------- -------- --------
Net increase (decrease) in net asset value $ 0.17 $ 0.16 $ (0.43) $ 0.79 $ (1.07)
-------- -------- -------- -------- --------
Net asset value, end of year $ 10.10 $ 9.93 $ 9.77 $ 10.20 $ 9.41
======== ======== ======== ======== ========
Total return* 7.78% 8.51% 2.29% 16.06% (3.97)%
Ratio of net expenses to average net assets 1.00%+ 1.02%+ 1.01%+ 1.02%+ 1.00%
Ratio of net investment income to average net assets 5.80%+ 6.55%+ 6.51%+ 6.85%+ 6.84%
Portfolio turnover rate 81% 63% 43% 62% 61%
Net assets, end of year (in thousands) $128,925 $138,022 $145,408 $162,708 $161,858
Ratios assuming no waiver of management fees by PIM and
no reduction for fees paid indirectly:
Net expenses 1.10% 1.14% 1.17% 1.22% 1.12%
Net investment income 5.70% 6.43% 6.35% 6.65% 6.72%
Ratios assuming waiver of management fees by PIM and
reduction for fees paid indirectly:
Net expenses 1.00% 1.00% 1.00% 1.00% --
Net investment income 5.80% 6.57% 6.52% 6.87% --
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
Pioneer America Income Trust
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FINANCIAL HIGHLIGHTS 12/31/98
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Year Year Year
Ended Ended Ended Ended 4/29/94 to
12/31/98 12/31/97 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C>
CLASS B
Net asset value, beginning of period $ 9.90 $ 9.75 $ 10.17 $ 9.40 $ 9.85
-------- -------- -------- -------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.51 $ 0.57 $ 0.57 $ 0.61 $ 0.40
Net realized and unrealized gain (loss)
on investments 0.17 0.15 (0.42) 0.77 (0.45)
-------- -------- -------- -------- --------
Net increase (decrease) from investment operations $ 0.68 $ 0.72 $ 0.15 $ 1.38 $ (0.05)
Distributions to shareholders:
Net investment income (0.51) (0.57) (0.57) (0.61) (0.40)
-------- -------- -------- -------- --------
Net increase (decrease) in net asset value $ 0.17 $ 0.15 $ (0.42) $ 0.77 $ (0.45)
-------- -------- -------- -------- --------
Net asset value, end of period $ 10.07 $ 9.90 $ 9.75 $ 10.17 $ 9.40
======== ======== ======== ======== ========
Total return* 7.08% 7.61% 1.59% 15.08% (0.57)%
Ratio of net expenses to average net assets 1.74%+ 1.77%+ 1.75%+ 1.77%+ 1.78%**
Ratio of net investment income to average net assets 4.99%+ 5.78%+ 5.78%+ 5.92%+ 6.35%**
Portfolio turnover rate 81% 63 43% 62% 61%
Net assets, end of period (in thousands) $ 22,602 $ 11,935 $ 9,557 $ 6,992 $ 2,170
Ratios assuming no waiver of management fees by PIM
and no reduction for fees paid indirectly:
Net expenses 1.81% 1.90% 1.91% 1.97% 1.90%**
Net investment income 4.92% 5.65% 5.62% 5.72% 6.23%**
Ratios assuming waiver of management fees by PIM and
reduction for fees paid indirectly:
Net expenses 1.72% 1.75% 1.73% 1.72% --
Net investment income 5.01% 5.80% 5.80% 5.97% --
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 12/31/98
- --------------------------------------------------------------------------------
Year Ended Year Ended 1/31/96 to
CLASS C 12/31/98 12/31/97 12/31/96
Net asset value, beginning of period $ 9.90 $ 9.74 $ 10.16
--------- -------- --------
Increase (decrease) from investment
operations:
Net investment income $ 0.52 $ 0.57 $ 0.52
Net realized and unrealized gain
(loss) on investments 0.17 0.16 (0.42)
--------- -------- --------
Net increase from investment
operations $ 0.69 $ 0.73 $ 0.10
Distributions to shareholders:
Net investment income (0.52) (0.57) (0.52)
--------- -------- --------
Net increase (decrease) in net
asset value $ 0.17 $ 0.16 $ (0.42)
--------- -------- --------
Net asset value, end of period $ 10.07 $ 9.90 $ 9.74
========= ======== ========
Total return* 7.09% 7.78% 1.04%
Ratio of net expenses to average
net assets 1.65%+ 1.73%+ 1.80%**+
Ratio of net investment income
to average net assets 4.97%+ 5.74%+ 5.73%**+
Portfolio turnover rate 81% 63% 43%
Net assets, end of period
(in thousands) $ 11,891 $ 3,780 $ 1,306
Ratios assuming no waiver
of management fees by PIM
and no reduction for fees
paid indirectly:
Net expenses 1.70% 1.85% 1.95%**
Net investment income 4.92% 5.62% 5.58%**
Ratios assuming waiver of
management fees by PIM
and reduction for fees
paid indirectly:
Net expenses 1.62% 1.68% 1.76%**
Net investment income 5.00% 5.79% 5.77%**
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
16
<PAGE>
Pioneer America Income Trust
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NOTES TO FINANCIAL STATEMENTS 12/31/98
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer America Income Trust (the Trust) is a Massachusetts bus- iness trust
registered under the Investment Company Act of 1940 as a diversified, open-end
management investment company. The investment objective of the Trust is to
provide a high level of current income consistent with preservation of capital
and prudent investment risk.
The Trust offers three classes of shares - Class A, Class B and Class C shares.
Shares of Class A, Class B and Class C each represent an interest in the same
portfolio of investments of the Trust and have equal rights to voting,
redemptions, dividends and liquidation, except that each class of shares can
bear different transfer agent and distribution fees and have exclusive voting
rights with respect to the distribution plans that have been adopted by Class A,
Class B and Class C shareholders, respectively.
The Trust's financial statements have been prepared in conformity with generally
accepted accounting principles that require the management of the Trust to,
among other things, make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies consistently followed by the Trust, which are in conformity with those
generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded on trade date. Securities are valued at
prices supplied by independent pricing services, which consider such factors
as Treasury spreads, yields, maturities and ratings, and valuations may be
supplemented by dealers and other sources, as required. Principal amounts of
mortgage-backed securities are adjusted for monthly paydowns. Premium and
discount related to certain mortgage-backed securities are amortized or
accreted in proportion to the underlying monthly paydowns. Interest income is
recorded on the accrual basis. Temporary cash investments are valued at
amortized cost.
17
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 12/31/98 (continued)
- --------------------------------------------------------------------------------
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes. It
is the Trust's practice to first select for sale those securities that have
the highest cost and also qualify for long-term capital gain or loss
treatment for tax purposes.
B. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareholders. Therefore, no federal income tax provision is required.
The characterization of distributions to shareholders for financial reporting
purposes is determined in accordance with federal income tax rules.
Therefore, the source of the Trust's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in-capital, depending on the type of book/tax differences that may
exist.
C. Fund Shares
The Trust records sales and repurchases of its shares on trade date. Net
losses, if any, as a result of cancellations are absorbed by Pioneer Funds
Distributor, Inc. (PFD), the principal underwriter for the Trust and an
indirect subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $24,690 in
underwriting commissions on the sale of fund shares during the year ended
December 31, 1998.
D. Class Allocations
Distribution fees are calculated based on the average daily net asset value
attributable to Class A, Class B and Class C shares of the Trust,
respectively. Shareholders of each class share all expenses and fees paid to
the transfer agent, Pioneering Services Corporation (PSC), for their
services, which are allocated based on the number of accounts in each class
and the ratable allocation of related out-of-pocket expense (see Note 3).
Income, common expenses and realized and unrealized gains and losses are
calculated at the Trust level and allocated daily to each class of shares
based on the respective percentage of adjusted net assets at the beginning of
the day.
18
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Trust declares as daily dividends substantially all of its net investment
income. All dividends are paid on a monthly basis. Short-term capital gain
distributions, if any, may be declared with the daily dividends.
Distributions to shareholders are recorded as of the ex-dividend date.
Distributions paid by the Trust with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B and Class C shares can bear different transfer
agent and distribution fees.
E. Repurchase Agreements
With respect to repurchase agreements entered into by the Trust, the value of
the underlying securities (collateral), including accrued interest received
from counterparties, is required to be at least equal to or in excess of the
value of the repurchase agreement at the time of purchase. The collateral for
all repurchase agreements is held in safekeeping in the customer-only account
of the Trust's custodian, or subcustodians. The Trust's investment adviser,
Pioneer Investment Management, Inc. (PIM) (formerly Pioneering Management
Corp.), is responsible for determining that the value of the collateral
remains at least equal to the repurchase price.
2. Management Agreement
PIM manages the Trust's portfolio and is a wholly owned subsidiary of PGI.
Management fees are calculated daily at the annual rate of 0.50% of the Trust's
average daily net assets.
PIM has agreed not to impose a portion of its management fee and to assume other
operating expenses of the Trust to the extent necessary to limit Class A
expenses to 1.00% of the average daily net assets attributable to Class A
shares; the portion of the Trust-wide expenses attributable to Class B and Class
C shares will be reduced only to the extent that such expenses are reduced for
Class A shares. PIM's agreement is voluntary and temporary and may be revised or
terminated at any time.
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Trust. At December 31, 1998, $193,330 was payable to
PIM related to management fees, administrative and certain other services.
19
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 12/31/98 (continued)
- --------------------------------------------------------------------------------
3. Transfer Agent
PSC, a wholly owned subsidiary of PGI, provides substantially all transfer agent
and shareholder services to the Trust at negotiated rates. Included in due to
affiliates is $28,500 in transfer agent fees payable to PSC at December 31,
1998.
4. Plan of Distribution
The Trust adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan and Class C Plan) in accordance with Rule 12b-1 of the Investment
Company Act of 1940. Pursuant to the Class A Plan, the Trust pays PFD a service
fee of up to 0.25% of the Trust's average daily net assets in reimbursement of
its actual expenditures to finance activities primarily intended to result in
the sale of Class A shares. Pursuant to the Class B Plan and the Class C Plan,
the Trust pays PFD 1.00% of the average daily net assets attributable to each
class of shares. The fee consists of a 0.25% service fee and a 0.75%
distribution fee paid as compensation for personal services and/or account
maintenance services or distribution services with regard to Class B and Class C
shares. Included in due to affiliates is $59,149 in distribution fees payable to
PFD at December 31, 1998.
In addition, redemptions of each class of shares may be subject to a contingent
deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on redemptions of
certain net asset value purchases of Class A shares within one year of purchase.
Class B shares that are redeemed within six years of purchase are subject to a
CDSC at declining rates beginning at 4.0%, based on the lower of cost or market
value of shares being redeemed. Redemptions of Class C shares within one year of
purchase are subject to a CDSC of 1.00%. Proceeds from the CDSCs are paid to
PFD. For the year ended December 31, 1998, CDSCs in the amount of $40,845 were
paid to PFD.
5. Expense Offsets
The Trust has entered into certain expense offset arrangements resulting in a
reduction in the Trust's total expenses. For the year ended December 31, 1998,
the Trust's expenses were reduced by $26,077 under such arrangements.
20
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareowners and the Board of Trustees
of Pioneer America Income Trust:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer America Income Trust as of December 31, 1998, and the
related statement of operations, the statements of changes in net assets, and
the financial highlights for the periods presented. These financial statements
and financial highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1998, by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer America Income Trust as of December 31, 1998, the results of its
operations, the changes in its net assets, and the financial highlights for the
periods presented, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
February 12, 1999
21
<PAGE>
Pioneer America Income Trust
- --------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
Trustees Officers
John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
Mary K. Bush President
Richard H. Egdahl, M.D. David D. Tripple, Executive Vice President
Margaret B.W. Graham Sherman B. Russ, Vice President
John W. Kendrick John A. Boynton, Treasurer
Marguerite A. Piret Joseph P. Barri, Secretary
David D. Tripple
Stephen K. West
John Winthrop
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Public Accountants
Arthur Andersen LLP
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneering Services Corporation
22
<PAGE>
- --------------------------------------------------------------------------------
THE PIONEER FAMILY OF MUTUAL FUNDS
- --------------------------------------------------------------------------------
For information about any Pioneer mutual fund, please contact your investment
representative, or call Pioneer at 1-800-225-6292. Ask for a free fund
information kit, which includes a fund prospectus. Please read the prospectus
carefully before you invest or send money.
Growth Funds Income Funds
United States Taxable
Pioneer Capital Growth Fund Pioneer America Income Trust
Pioneer Growth Shares Pioneer Bond Fund
Pioneer Mid-Cap Fund Pioneer Short-Term Income Trust
Pioneer Small Company Fund Tax-Free
Pioneer Micro-Cap Fund Pioneer Tax-Free Income Fund
International/Global Money Market Fund
Pioneer Emerging Markets Fund Pioneer Cash Reserves Fund
Pioneer Europe Fund
Pioneer Gold Shares
Pioneer Indo-Asia Fund
Pioneer International Growth Fund
Pioneer World Equity Fund
Growth and Income Funds
Pioneer Balanced Fund
Pioneer Equity-Income Fund
Pioneer Fund
Pioneer Real Estate Shares
Pioneer II
23
<PAGE>
- --------------------------------------------------------------------------------
RETIREMENT PLANS FROM PIONEER
- --------------------------------------------------------------------------------
Pioneer has a long history of helping people work toward their retirement goals,
offering plans suited to the individual investor and businesses of all sizes.
For more information on Pioneer retirement plans, contact your investment
professional, or call Pioneer at 1-800-622-0176.
Individual Retirement Account (IRA)
Traditional IRA
A Traditional IRA allows anyone under age 701/2 with earned income to contribute
up to $2,000 annually. Spouses may contribute up to $2,000 annually into a
separate IRA, for a total of $4,000 per year for a married couple.
Earnings are tax-deferred, and contributions may be tax-deductible.
Roth IRA
Contributions, up to $2,000 a year per person in earned income, are not
tax-deductible, but earnings are tax-free for qualified withdrawals. You can
contribute beyond age 701/2.
401(k) Plan
The traditional 401(k) plan allows employees to make pre-tax contributions
through payroll deduction, up to $9,500 per year or 25% of pay, whichever is
less. Employers may contribute.
SIMPLE (Savings Incentive Match PLan for Employees)
401(k) or IRA Plan
Businesses with 100 or fewer eligible employees can establish either plan; both
resemble the traditional 401(k), but with less testing and lower administration
costs. Employees can make pre-tax contributions of up to $6,000 per year, and an
employer contribution is required.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties.
24
<PAGE>
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- --------------------------------------------------------------------------------
403(b) Plan
Also known as a Tax-Sheltered Account (TSA), a 403(b) plan is available only to
employees of public schools, not-for-profit hospitals and other tax-exempt
organizations. A 403(b) plan lets employees set aside a portion of their salary,
before taxes, through payroll deduction.
Simplified Employee Pension Plan (SEP)
SEPs let self-employed people and small-business owners make tax-deductible
contributions of up to 15% of their income. Generally, employers must contribute
the same percentage of pay for themselves and any eligible employees;
contributions are made directly to employees' IRAs. SEPs are easy to administer
and can be an especially good choice for firms with few or no employees.
Profit Sharing Plan
Profit sharing plans offer companies considerable flexibility, allowing them to
decide each year whether a contribution will be made and how much, up to 15% of
each participant's pay. These plans can include provisions for loans and vesting
schedules.
Age-Weighted Profit Sharing Plan
Like traditional profit sharing plans, employer contributions are flexible, but
age-weighted plans allocate contributions based on both age and salary.
Age-weighted plans are designed for employers who want to maximize their own
contributions while keeping contributions to employees affordable.
Money Purchase Pension Plan (MPP)
Money purchase plans are similar to profit sharing plans, but allow for higher
annual contributions -- up to 25% of pay. MPPs aren't as flexible as profit
sharing plans; a fixed percentage of pay must be contributed each year,
determined when the plan is established. Businesses often set up both MPPs and
profit sharing plans.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties.
25
<PAGE>
- --------------------------------------------------------------------------------
PROGRAMS AND SERVICES FOR PIONEER SHAREOWNERS
- --------------------------------------------------------------------------------
Your investment representative can give you additional information on Pioneer's
programs and services. If you want to order literature on any of the following
items directly, simply call Pioneer at 1-8O0-225-6292.
FactFone(SM)
Our automated account information service, available to you 24 hours a day,
seven days a week. FactFone gives you a quick and easy way to check fund share
prices, yields, dividends and distributions, as well as information about your
own account. Simply call 1-800-225-4321. For specific account information, have
your 13-digit account number and four-digit personal identification number at
hand.
9O-Day Reinstatement Privilege (for Class A Shares)
Enables you to reinvest all or a portion of the money you redeem from your
Pioneer account - without paying a sales charge - within 90 days of your
redemption. You have the choice of investing in any Pioneer fund, as long as you
meet its minimum investment requirement.
Investomatic Plan
An easy and convenient way for you to invest on a regular basis. All you need to
do is authorize a set amount of money to be moved out of your bank account into
the Pioneer fund of your choice. Investomatic also allows you to change the
dollar amount, frequency and investment date right over the phone. By putting
aside affordable amounts of money regularly, you can build a long-term
investment - without sacrificing your current standard of living.
Payroll Investment Program (PIP)
Lets you invest in a Pioneer fund directly through your paycheck. All that's
involved is for your employer to fill out an authorization form allowing Pioneer
to deduct from participating employees' paychecks. You specify the dollar amount
you want to invest into the Pioneer fund(s) of your choice.
26
<PAGE>
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- --------------------------------------------------------------------------------
Automatic Exchange Program
A simple way to move money from one Pioneer fund to another over a
period of time. Just invest a lump sum in one fund, and select the other Pioneer
funds you wish to invest in. You choose the amounts and dates for Pioneer to
sell shares of your original fund and use the proceeds to buy shares of the
other funds you have chosen. Over time, your investment will be shifted out of
the original fund. (Automatic Exchange is available for originating accounts
with a balance of $5,000 or more.)
Directed Dividends
Lets you invest cash dividends from one Pioneer fund to an account in
another Pioneer fund with no sales charge or fee. Simply fill out the applicable
information on a Pioneer Account Options Form. (This program is available for
dividend payments only; capital gains distributions are not eligible at this
time.)
Direct Deposit
Lets you move money into your bank account using electronic funds transfer
(EFT). EFT moves your money faster than you would receive a check, eliminates
unnecessary paper and mail, and avoids lost checks. Simply fill out a Pioneer
Direct Deposit Form, giving your instructions.
Systematic Withdrawal Plan (SWP)
Lets you establish automatic withdrawals from your account at set intervals. You
decide the frequency and the day of the month you want. Pioneer will send the
proceeds by check to the address you designate, or electronically to your bank
account. You also can authorize Pioneer to make the redemptions payable to
someone else. (SWPs are available for accounts with a value of $10,000 or more.)
27
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This page for your notes.
28
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This page for your notes.
29
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HOW TO CONTACT PIONEER
- --------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account Information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(sm) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
Pioneering Services Corporation
60 State Street
Boston, Massachusetts 02109
Our toll-free fax 1-800-225-4240
Our internet e-mail address [email protected]
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
This report must be preceded or accompanied by a current
Fund prospectus.
Pioneer Investment Management, Inc. 0299-6030
[LOGO] 60 State Street Pioneer Funds Distributor, Inc.
Boston, Massachusetts 02109 Printed on Recycled Paper
www.pioneerfunds.com
