[Pioneer logo]
Pioneer Capital
Growth Fund
ANNUAL REPORT 10/31/96
<PAGE>
Table of Contents
Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 6
Schedule of Investments 9
Financial Statements 16
Notes to Financial Statements 22
Report of Independent Public Accountants 27
Tax Treatment of Distributions 28
Trustees' Fees and Share Ownership 29
Trustees, Officers and Service Providers 30
Programs and Services for Pioneer Shareowners 34
The Pioneer Family of Mutual Funds 37
<PAGE>
Pioneer Capital Growth Fund
LETTER FROM THE CHAIRMAN 10/31/96
Dear Shareowner,
It is with pleasure that I introduce this report for Pioneer Capital Growth
Fund, covering the year ended October 31, 1996. We wish to welcome the Fund's
new shareowners, particularly those in Class C Shares, introduced on January
31.
The year was fast-paced, exciting and nerve-racking for stock investors. The
Dow Jones Industrial Average (the Dow) moved to historic highs, although it
was a journey of significant peaks and troughs. While indicative of few
stocks - it includes only 30 large companies - the Dow is a significant
barometer of investor sentiment. In the face of today's enthusiasm, we urge
you to maintain realistic expectations about the stock market. It doesn't
always go up, and certainly not always at the extraordinary rate of the past
few years. There can be significant risks for those who chase "hot" stocks;
your Fund's management team still thinks a stock should be purchased because
it represents a good value for a company with strong prospects over time.
This approach is typical of the group of managers and research analysts that
has been dedicated to your Fund since its inception. The team, under the
direction of senior portfolio manager Warren Isabelle, offers continuity,
depth and focus in its pursuit of investment opportunities for your Fund.
A final note. As you see, we've given your Fund's annual report a facelift in
response to what shareowners told us they want to see in fund reports. Now
you'll find a Table of Contents and consistent, easy-to-read summaries of
portfolio information and performance. There's also a Portfolio Management
Discussion that offers insights into market conditions, portfolio strategy
and results. I urge you to read on to learn more about your Fund.
Please contact your investment representative, or us at 1-800-225-6292, if
you have questions about your investment in Pioneer Capital Growth Fund.
Thank you for your continued support.
Respectfully,
/s/ John F. Cogan, Jr.
John F. Cogan, Jr.,
Chairman and President
1
<PAGE>
Pioneer Capital Growth Fund
PORTFOLIO SUMMARY 10/31/96
Portfolio Diversification
(As a percentage of total investment portfolio)
[pie chart]
U.S. Common Stocks 74%
Short-Term Cash Equivalents 23%
Depositary Receipts
for International
Stock 3%
Sector Distribution
(As a percentage of equity holdings)
[pie chart]
Consumer Non-Durables 28%
Technology 22%
Capital Goods 14%
Services 13%
Basic Industries 12%
Financial 7%
Transportation 2%
Consumer Durables 1%
Utilities 1%
10 Largest Holdings
(As a percentage of equity holdings)
<TABLE>
<S> <C> <C> <C>
1. 20th Century Industries 2.59% 6. U.S. Industries, Inc. 2.13%
2. Fingerhut Companies, Inc. 2.53 7. Toys "R" Us, Inc. 2.12
3. Unisys Corp. 2.24 8. Woolworth Corp. 2.11
4. Western National Corp. 2.19 9. Shaw Industries, Inc. 2.11
5. BancTec, Inc. 2.13 10. Lone Star Industries, Inc. 2.04
</TABLE>
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/96 CLASS A SHARES
Share Prices and Distributions
Net Asset Value
per Share 10/31/96 10/31/95
$ 19.85 $ 19.42
Distributions per Share Income Short-Term Long-Term
(10/31/95-10/31/96) Dividends Capital Gains Capital Gains
$ 0.088 $ 1.158 $0.716
Investment Returns
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Capital Growth Fund at public offering price, compared to the
growth of the Standard & Poor's 500 Index.
Average Annual Total Returns
(As of October 31, 1996)
Period Net Asset Public Offering
Value Price*
Life-of-Fund 17.05% 15.95%
(7/25/90)
5 Years 19.46 18.05
1 Year 13.12 6.64
* Reflects deduction of the maximum 5.75% sales charge at the beginning
of the period and assumes reinvestment of distributions at net asset value.
[mountain chart]
Growth of $10,000
Standard & Poor's Pioneer Capital
500 Index Growth Fund*
7/25/90 10000 9425
10/31/90 8597 6732
4/30/91 10794 9470
10/31/91 11477 10395
4/30/92 12311 12315
10/31/92 12616 11526
4/30/93 13446 14341
10/31/93 14494 15743
4/30/94 14162 16752
10/31/94 15055 18738
4/30/95 16628 20575
10/31/95 19023 22348
4/30/96 21639 26375
10/31/96 23593 25292
The Standard & Poor's (S&P) 500 Index is an unmanaged measure of 500 widely
held common stocks listed on the New York Stock Exchange, American Stock
Exchange and the Over-the-Counter market. 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. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
3
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Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/96 CLASS B SHARES
Share Prices and Distributions
Net Asset Value
per Share 10/31/96 10/31/95
$ 19.53 $ 19.20
Distributions per Share Income Short-Term Long-Term
(10/31/95-10/31/96) Dividends Capital Gains Capital Gains
$ 0.016 $ 1.158 $0.716
Investment Returns
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Capital Growth Fund, compared to the growth of the
Standard & Poor's 500 Index.
Average Annual Total Returns
(As of October 31, 1996)
Period If If
Held Redeemed*
Life-of-Fund 17.94% 17.04%
(4/4/94)
1 Year 12.27 8.27
* 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.
[mountain chart]
Growth of $10,000
Pioneer Capital Standard & Poor's
Growth Fund* 500 Index
4/4/94 10000 10000
4/30/94 10321 10273
7/31/94 10489 10521
10/31/94 11513 10921
1/31/95 11396 10956
4/30/95 12589 12062
7/31/95 13789 13259
10/31/95 13633 13800
1/31/96 14640 15181
4/30/96 16019 15697
7/31/96 14726 15443
10/31/96 15006 17115
The Standard & Poor's (S&P) 500 Index is an unmanaged measure of 500 widely
held common stocks listed on the New York Stock Exchange, American Stock
Exchange and the Over-the-Counter market. 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. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
4
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Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/96 CLASS C SHARES
Share Prices and Distributions
Net Asset Value
per Share 10/31/96 1/31/96
$ 19.53 $ 18.69
Distributions per Share Income Short-Term Long-Term
(1/31/96-10/31/96) Dividends Capital Gains Capital Gains
- - -
Investment Returns
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Capital Growth Fund, compared to the growth of the
Standard & Poor's 500 Index.
Cumulative Total Returns
(As of October 31, 1996)
Period If If
Held Redeemed*
Life-of-Fund
(1/31/96) 4.50% 3.50%
* Reflects deduction of the 1% contingent deferred sales charge (CDSC) at the
end of the period and assumes reinvestment of distributions.
[mountain chart]
Growth of $10,000
Pioneer Capital Standard & Poor's
Growth Fund* 500 Index
1/31/96 10000 10000
2/28/96 10048 10069
3/31/96 10139 10203
4/30/96 10931 10340
5/31/96 11327 10577
6/30/96 10856 10660
7/31/96 10053 10172
8/30/96 10364 10364
9/30/96 10594 10987
10/31/96 10349 11274
The Standard & Poor's (S&P) 500 Index is an unmanaged measure of 500 widely
held common stocks listed on the New York Stock Exchange, American Stock
Exchange and the Over-the-Counter market. 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. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
5
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Pioneer Capital Growth Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/96
Dear Shareowner,
Pioneer Capital Growth Fund completed its sixth fiscal year on October 31,
1996. The 12 months were challenging for your Fund, as a "narrow" stock
market rewarded a few, select stocks - typically large, familiar companies -
seemingly regardless of how expensive they became. Your Fund invests based on
individual company merits, which often means the companies we consider good
values have yet to be recognized as such by Wall Street.
A Momentum-Driven, Volatile Stock Market
Nineteen ninety-six began the same way 1995 ended - with the U.S. stock
market moving higher thanks to slow but sustained economic growth and low
inflation. The Federal Reserve (the Fed) cut short-term interest rates in
December 1995 and January 1996, indicating that inflation and accelerated
economic growth were not concerns. The mood quickly changed in February,
however, when a leap in the monthly employment report signaled a faster-
moving economy and prompted concerns of higher inflation and rising interest
rates. Stock market investors feared corporate profits would suffer and that
fixed-income securities would become more appealing options for investors.
As the year progressed, especially in July, announcements of lower-than-
expected earnings from various companies contributed further to market
instability. However, dramatic price increases in stocks of select, large-
sized companies helped push market indexes higher. For the fiscal year, the
Dow Jones Industrial Average of 30 large-capitalization stocks posted a total
return of 29.71%, and the Standard & Poor's 500 Index returned 24.02%. (Total
returns assume reinvestment of distributions.) Meanwhile, the more diverse
NASDAQ Composite Index of 5,540 companies gained a lesser, but still
attractive, 17.90% in price.
Our Search for Value
Pioneer Capital Growth Fund invests for long-term capital growth through
well-managed, well-priced companies that exhibit solid prospects for future
growth. Because we avoid "momentum-driven" stocks - securities
6
<PAGE>
Pioneer Capital Growth Fund
purchased simply because their price is going up - your Fund's double-digit
one-year total return lagged the market indexes. Clearly, some investors are
willing to risk their money on the whims of an emotion-driven stock market.
But we believe such a strategy is dangerous for long-term investors. Instead,
as we explain in some detail later in this report, we maintained our "value"
approach, selecting stocks that were attractively priced based on their
future potential. While we are disappointed at not having kept pace for the
fiscal year, we expect our strategy will serve long-term investors well - as
it has over the Fund's lifetime.
Another important event over the past year was the substantial increase in the
Fund's asset base, due to investor inflows and the appreciation of holdings. Net
assets totaled $1.9 billion as of October 31, up from $1.2 billion one year ago.
Naturally, we took deliberate care in deploying assets in a fast-paced,
record-setting market. We invested $915 million over the course of the fiscal
year, although 23% of the portfolio remained in temporary cash investments at
the period's end. We intend, of course, to put the Fund's cash to work as
promptly as good values become available. We also are pleased with the
investments we have uncovered, given lofty stock prices. (Our approach does not
change in different market environments; however, a downturn or "correction" in
the market could actually work in the Fund's favor, with lower prices creating
buying opportunities.)
One of the Fund's strengths is its flexibility to invest in companies of
essentially any size and industry. As the Fund has grown, we have taken
advantage of this flexibility to add significant positions in mid-size and
large companies to the Fund's sizable investments in small companies. We
apply the same process and philosophy to businesses of all sizes - an
emphasis on sound management, strong product and market position, and solid
financial fundamentals. We also have the same eye for companies on the brink
of a turnaround or takeover, situations that exist with firms large and
small. Make no mistake: We remain committed to the manner of value investing
that has brought the Fund success to date. Larger-capitalization stocks can
offer the same intriguing values as small companies, and we are confident the
Fund will benefit from its larger holdings.
7
<PAGE>
Pioneer Capital Growth Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/96 (continued)
Not surprisingly, then, many of the Fund's new additions over the past 12
months were mid-size and large companies from a wide array of sectors. They
include Toys "R" Us, Westinghouse Electric, 20th Century Industries and Kmart;
these all proved rewarding and contributed significantly to results during
the fiscal year. Other stocks we like, but have yet to appreciate to our
target price, include Levitz Furniture, Unisys and Shaw Industries. Clearly,
some stocks move more quickly than others; it is important to give an issue
ample time to prove its worth. We are more than comfortable holding stocks
until others realize the value we see.
Of course, inevitably we must eliminate a stock when it is apparent it will
not meet our expectations. One such example was Mid-American Waste Systems.
Despite encountering a few companies that fail to reach their potential, we
nonetheless expect that researching and monitoring individual companies will
most effectively protect the portfolio and help achieve the Fund's growth
objective.
Moving Forward
While it appears 1996 as a whole will be another strong year for the stock
market, it also has been volatile, reflecting how quickly investors have
acted on their emotions. Of course, even if prices remain turbulent over the
near term, our experience has taught us that investing based on market
momentum will subside and investors ultimately will focus their attention on
what really counts - identifying the merits of individual stocks.
We believe your Fund is well positioned to benefit from a stock market driven
by company fundamentals. To our eyes, finding value remains the most
effective way to invest for the long term - even if it means the Fund
temporarily lags the market. We are optimistic our efforts will continue to
reward patient investors. On behalf of the entire team of portfolio managers
and analysts that contribute to your Fund, I thank you for your support.
Respectfully,
/s/ Warren J. Isabelle
Warren J. Isabelle,
Portfolio Manager
8
<PAGE>
Pioneer Capital Growth Fund
SCHEDULE OF INVESTMENTS 10/31/96
Shares Value
COMMON STOCKS - 76.7%
Basic Industries - 9.0%
Chemicals - 5.6%
2,020,000 Agrium Inc. $ 27,017,500
1,331,900 Crompton & Knowles Corp. 23,974,200
389,300 The Geon Co. 7,640,012
1,400,000 Methanex Corp.* 11,812,500
1,365,200 NL Industries, Inc. 11,604,200
20,000 Uniroyal Technology Corp.* 61,250
1,455,200 Wellman, Inc. 25,829,800
----------------
$107,939,462
----------------
Containers - 1.2%
19,000 BWay Corp.* $ 342,000
947,500 Jefferson Smurfit Corp.* 13,265,000
1,829,500 Zapata Corp.*+ 6,860,625
----------------
$ 20,467,625
----------------
Forest Products - 0.1%
100,000 Louisiana-Pacific Corp. $ 2,087,500
----------------
Iron & Steel - 0.8%
4,230,900 Armco, Inc.* $ 15,865,875
----------------
Non-Ferrous Metals - 0.7%
751,600 Brush Wellman, Inc. $ 14,186,450
----------------
Paper Products - 0.6%
1,507,350 Aracruz Cellulose S.A. (Sponsored A.D.R.) $ 12,058,800
----------------
Total Basic Industries $172,605,712
----------------
Capital Goods - 10.6%
Construction & Engineering - 4.4%
498,000 BMC West Corp.* $ 5,976,000
1,983,700 Justin Industries+ 20,332,925
1,217,000 The Lamson & Sessions Co.*+ 8,975,375
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
Construction & Engineering - (Continued)
815,000 Lone Star Industries, Inc.+ $ 29,951,250
2,103,500 Morrison Knudsen Corp.* 18,931,500
----------------
$ 84,167,050
----------------
Pollution/Waste - 0.4%
1,843,500 Catalytica, Inc.*+ $ 7,143,563
----------------
Producer Goods - 5.8%
366,000 Ferrofluidics Corp.*+ $ 3,065,250
362,900 Figgie International, Inc.* 3,810,450
304,400 Furon Co. 6,392,400
323,300 Gehl Co.*+ 2,586,400
1,245,400 Griffon Corp.* 11,831,300
743,800 Insilco Corp.*+ 29,008,200
1,085,000 Park Ohio Industries, Inc.+ 16,275,000
290,661 Raymond Corp. 5,086,567
905,000 Sudbury, Inc.*+ 10,181,250
1,360,000 Westinghouse Electric Co. 23,290,000
----------------
$111,526,817
----------------
Total Capital Goods $202,837,430
----------------
Consumer Durables - 0.9%
Motor Vehicles - 0.9%
737,440 Supreme Industries, Inc.*+ $ 4,240,280
2,047,100 TBC Corp.*+ 13,562,038
----------------
$ 17,802,318
----------------
Total Consumer Durables $ 17,802,318
----------------
Consumer Non-Durables - 21.3%
Consumer Luxuries - 1.9%
543,000 Arctic Cat Inc. $ 5,090,625
1,160,100 U.S. Industries, Inc.* 31,322,700
----------------
$ 36,413,325
----------------
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
Home Products - 1.1%
747,998 Ladd Furniture, Inc.+ $ 9,630,474
463,000 The Rival Co. 10,880,500
----------------
$ 20,510,974
----------------
Retail Non-Food - 12.1%
1,733,300 Best Products Corp., Inc.*+ $ 54,079
3,565,000 Charming Shoppes, Inc.* 16,488,125
471,900 Cole National Corp.* 11,148,637
2,498,000 Fingerhut Companies, Inc.+ 37,157,750
189,927 Footstar, Inc.* 4,178,394
1,596,000 Genesco Inc.*+ 14,364,000
840,000 Grossman's Inc.* 1,286,208
2,867,000 Kmart Corp. 27,953,250
2,154,400 Levitz Furniture, Inc.*+ 5,655,300
569,700 Melville Corp. 21,221,325
380,000 MicroAge, Inc.* 7,600,000
435,600 Office Depot, Inc.* 8,548,650
1,682,300 The Stride Rite Corp. 13,878,975
920,000 Toys Us, Inc.* 31,165,000
1,474,900 Woolworth Corp.* 30,972,900
----------------
$231,672,593
----------------
Textiles/Clothes - 6.2%
1,172,800 Galey & Lord, Inc.*+ $ 16,272,600
879,700 Guilford Mills, Inc.+ 20,892,875
1,086,600 Paragon Trade Brands, Inc.*+ 28,523,250
2,633,100 Shaw Industries, Inc. 30,938,925
1,685,900 Tultex Corp.*+ 10,958,350
1,444,700 Worldtex, Inc.*+ 11,377,013
----------------
$118,963,013
----------------
Total Consumer Non-Durables $407,559,905
----------------
Financial Services - 5.8%
Insurance - General - 5.5%
531,855 Financial Security Assurance Holdings Ltd. $ 14,891,940
660,000 Gryphon Holdings, Inc.*+ 9,322,500
341,500 Travelers/Aetna Property Casualty Corp. 10,245,000
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
Insurance - General (Continued)
2,381,600 20th Century Industries* $ 38,105,600
1,790,600 Western National Corp. 32,230,800
----------------
$104,795,840
----------------
Real Estate - 0.3%
1,716,782 Bluegreen Corp.*+ $ 5,794,139
----------------
Total Financial $110,589,979
----------------
Services - 10.2%
Health & Personal Care - 4.1%
795,900 American Healthcorp, Inc.*+ $ 7,063,612
470,000 Apria Healthcare Group, Inc.* 8,988,750
1,072,000 BioWhittaker, Inc.*+ 7,638,000
2,182,200 Coastal Physicial Group Inc.*+ 11,456,550
776,700 Integrated Health Services, Inc. 19,126,238
1,042,000 Mid Atlantic Medical Services, Inc.* 11,201,500
1,022,200 Sun Healthcare Group, Inc.* 13,033,050
----------------
$ 78,507,700
----------------
Broadcasting & Media - 0.0%
145,000 Future Communications, Inc.*+@ $ 18,125
----------------
Pharmaceuticals - 5.7%
1,174,000 Alkermes, Inc.*+ $ 15,555,500
385,000 Autoimmune Inc.* 5,197,500
1,420,000 ImClone Systems, Inc.*+ 12,247,500
855,000 Ethical Holdings Plc (Sponsored A.D.R.)*+ 4,809,375
822,600 IVAX Corp. 13,572,900
325,225 Ligand Pharmaceuticals Inc. (Class B)* 4,024,659
630,000 Magainin Pharmaceuticals, Inc.* 7,008,750
1,529,900 Medeva Plc (Sponsored A.D.R.) 26,199,538
733,000 NeoRx Corp.* 3,619,187
1,110,500 Sepracor, Inc.*+ 18,045,625
----------------
$110,280,534
----------------
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
Misc. - Services - 0.4%
759,200 AMRE, Inc.* $ 7,022,600
13,500 Sabre Group Holdings, Inc.* 411,750
----------------
$ 7,434,350
----------------
Total Services $196,240,709
----------------
Technology - 17.0%
Business Machines - 2.5%
1,363,900 Amtech Corp.*+ $ 7,842,425
325,000 Apple Computer, Inc. 7,475,000
5,254,900 Unisys Corp.* 32,843,125
----------------
$ 48,160,550
----------------
Computer Services - 5.1%
731,500 AFC Cable Systems*+ $ 12,984,125
1,066,600 Amdahl Corp.* 10,932,650
1,539,600 BancTec, Inc.*+ 31,369,350
1,608,500 Banyan Systems, Inc.*+ 6,635,063
798,000 CrossCom Corp.*+ 4,089,750
255,000 Symantec Corp.* 2,773,125
847,950 Triad Systems Corp.* 8,108,522
555,000 Viewlogic Systems, Inc.* 5,237,812
1,163,300 Walker Interactive Systems, Inc.*+ 15,413,725
----------------
$ 97,544,122
----------------
Electronics - 9.4%
688,000 Belden, Inc. $ 19,780,000
151,500 Elsag Bailey Process Automation N.V.* 2,575,500
559,700 Instron Corp.+ 6,996,250
1,858,000 Intergraph Corp.* 17,418,750
480,000 Lam Research Corp.* 11,700,000
630,000 LSI Logic Corp.* 16,695,000
1,118,000 Marcam Corp.*+ 13,695,500
1,464,000 Micro Focus Group Plc (Sponsored A.D.R.)*+ 21,228,000
1,049,600 Rexel Inc.* 15,219,200
1,600,000 Teradyne, Inc.* 25,400,000
822,500 Vishay Intertechnology, Inc.* 14,805,000
1,057,000 Whittaker Corp.*+ 14,930,125
----------------
$180,443,325
----------------
Total Technology $326,147,997
----------------
The accompanying notes are an integral part of these financial statements.
13
<PAGE>
Transportation - 1.3%
Air Transport - 0.3%
250,000 Airborne Freight Corp. $ 4,968,750
----------------
Ships & Shipping - 1.0%
1,199,500 Avondale Industries, Inc.*+ $ 19,641,813
----------------
Total Transportation $ 24,610,563
----------------
Utilities - 0.6%
Telecommunications - 0.6%
313,000 AT&T Corp. $ 10,915,875
----------------
Total Utilities $ 10,915,875
----------------
TOTAL COMMON STOCKS
(Cost $1,353,893,817)(a) $1,469,310,488
----------------
Principal
Amount
TEMPORARY CASH INVESTMENTS - 23.3%
Commercial Paper - 23.3%
$15,000,000 Abbott Laboratories, Inc., 5.20%, 12/30/96 $ 14,872,167
19,310,000 Associates Corp. of America, Inc., 5.24%,
11/12/96 19,310,000
22,830,000 American Express Co., 5.25%, 11/20/96 22,830,000
10,520,000 Avco Financial Services, Inc., 5.24%,
12/6/96 10,466,406
5,800,000 Banc One Corp., 5.23%, 12/6/96 5,770,509
8,482,000 Banc One Corp., 5.22%, 12/13/96 8,430,345
15,000,000 Bell South Telephone Corp., 5.30%, 11/8/96 14,984,542
12,230,000 Corestates Financial Corp., 5.28%, 1/31/97 12,066,770
6,365,000 The Walt Disney Co., 5.20%, 12/3/96 6,335,580
15,000,000 EI DuPont & Co., 5.20%, 12/5/96 14,926,333
15,000,000 EI DuPont & Co., 5.20%, 12/19/96 14,896,200
7,151,000 Ford Motor Credit Co., 5.24%, 11/7/96 7,151,000
6,216,000 General Electric Credit Corp., 5.21%,
11/1/96 6,216,000
8,650,000 Golden Peanut Co., 5.24%, 12/2/96 8,610,969
15,450,000 Hewlett Packard Co., 5.26%, 11/6/96 15,438,713
5,045,000 Household Finance Corp., 5.22%, 11/13/96 5,045,000
7,700,000 Heinz (HJ) Co., 5.40%, 11/7/96 7,693,070
10,000,000 JP Morgan & Co., 5.23%, 11/5/96 9,994,189
12,440,000 Motorola, Inc., 5.20%, 12/10/96 12,369,921
The accompanying notes are an integral part of these financial statements.
14
<PAGE>
Principal
Amount Value
Commercial Paper - (Continued)
$12,073,000 National Rural Utilities Cooperative
Finance Corp., 5.32%, 11/18/96 $ 12,042,670
19,253,000 Norwest Financial Corp., 5.25%, 11/15/96 19,253,000
12,800,000 PACCAR Financial Corp., 5.23%, 11/4/96 12,794,421
8,922,000 Prudential Funding, Inc., 5.27%, 11/4/96 8,922,000
15,715,000 Raytheon Co., 5.21%, 12/17/96 15,610,382
11,130,000 Republic New York Corp., 5.22%, 12/9/96 11,068,674
9,750,000 Sara Lee Corp., 5.26%, 12/24/96 9,674,497
10,000,000 Shell Oil Co., 5.28%, 11/1/96 10,000,000
15,000,000 Southwestern Bell Telephone Co., 5.26%,
11/26/96 14,945,208
15,970,000 Toys "R" Us, Inc., 5.20%, 11/27/96 15,910,024
15,000,000 Toys "R" Us, Inc., 5.20%, 12/4/96 14,928,087
13,940,000 Trans America Corp., 5.22%, 12/11/96 13,859,148
14,450,000 Trans America Corp., 5.22% 12/18/96 14,351,523
12,000,000 Wal-Mart, Inc., 5.20%, 11/14/96 11,977,467
6,700,000 Warner-Lambert Co., 5.20%, 12/9/96 6,663,224
15,000,000 Xerox Corp., 5.36%, 11/19/96 14,959,800
9,100,000 Xerox Corp., 5.23%, 12/13/96 9,044,475
12,031,000 Exxon Asset Management, 5.24%, 11/13/96 12,031,000
----------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $445,443,314) $ 445,443,314
----------------
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,799,337,131) $1,914,753,802
----------------
* Non-income producing security.
+ Investment held by the Fund representing 5% or more of the outstanding
voting stock of such company.
@ Future Communications, Inc. was ordered into Chapter 7 of the federal
bankruptcy regulations on March 22, 1994.
(a) At October 31, 1996, the net unrealized gain on investments based on cost
for federal income tax purposes of $1,800,951,619 was as follows:
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $ 254,299,820
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (140,497,637)
---------------
Net unrealized gain $ 113,802,183
---------------
Purchases and sales of securities (excluding temporary cash investments) for
the year ended October 31, 1996, aggregated approximately $915,082,000 and
$489,568,000, respectively.
The accompanying notes are an integral part of these financial statements.
15
<PAGE>
Pioneer Capital Growth Fund
BALANCE SHEET 10/31/96
(Dollars in Thousands Except Per Share Amounts)
ASSETS:
Investment in securities, at value (including temporary cash
investments of $445,443) (cost $1,799,337) $1,914,754
Cash 194
Receivables -
Investment securities sold 811
Fund shares sold 7,760
Dividends and interest 577
Other 20
-----------
Total assets $1,924,116
-----------
LIABILITIES:
Payables -
Investment securities purchased $ 1,441
Fund shares repurchased 4,614
Due to affiliates 2,007
Accrued expenses 53
-----------
Total liabilities $ 8,115
-----------
NET ASSETS:
Paid-in capital $1,712,794
Accumulated undistributed net investment income 2,424
Accumulated undistributed net realized gain on investments 85,366
Net unrealized gain on investments 115,417
-----------
Total net assets $1,916,001
-----------
Net Asset Value Per Share:
(Unlimited number of shares authorized)
Class A (based on $1,299,611/65,471,405 shares) $ 19.85
-----------
Class B (based on $589,188/30,171,464 shares) $ 19.53
-----------
Class C (based on $27,202/1,392,774 shares) $ 19.53
-----------
Maximum Offering Price:
Class A $ 21.06
-----------
The accompanying notes are an integral part of these financial statements.
16
<PAGE>
Pioneer Capital Growth Fund
STATEMENT OF OPERATIONS
For the Year Ended 10/31/96
(Dollar in Thousands)
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $195) $ 7,853
Interest 15,537
-------
Total investment income $ 23,390
---------
EXPENSES:
Management fees $ 8,408
Transfer agent fees
Class A 2,408
Class B 1,125
Class C 23
Distribution fees
Class A 2,823
Class B 4,725
Class C 94
Accounting 116
Custodian fees 122
Registration fees 194
Professional fees 42
Printing 60
Fees and expenses of nonaffiliated trustees 27
Miscellaneous 56
-------
Total expenses $ 20,223
Less fees paid indirectly (292)
---------
Net expenses $ 19,931
---------
Net investment income $ 3,459
---------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments $ 86,162
Change in net unrealized gain on investments 62,314
---------
Net gain on investments 148,476
---------
Net increase in net assets resulting from operations $151,935
---------
The accompanying notes are an integral part of these financial statements.
17
<PAGE>
Pioneer Capital Growth Fund
STATEMENTS OF CHANGES IN NET ASSETS
For the Years Ended 10/31/96 and 10/31/95
(Dollars in Thousands Except Per Share Amount)
<TABLE>
<CAPTION>
Year Ended Year Ended
10/31/96 10/31/95
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 3,459 $ 3,285
Net realized gain on investments 86,162 118,604
Change in net unrealized gain on investments 62,314 13,149
----------- ------------
Net increase in net assets resulting from operations $ 151,935 $ 135,038
----------- ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.09 and $0.00 per share, respectively) $ (4,039) $ --
In excess of net investment income:
Class B ($0.02 and $0.00 per share, respectively) (281) --
Net realized gain:
Class A ($1.87 and $0.95 per share, respectively) (85,512) (24,106)
Class B ($1.87 and $0.95 per share, respectively) (32,984) (3,342)
----------- ------------
Total distributions to shareholders $ (122,816) $ (27,448)
----------- ------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $1,101,509 $ 829,056
Reinvestment of distributions 108,844 25,071
Cost of shares repurchased (480,558) (252,993)
----------- ------------
Net increase in net assets resulting from fund share
transactions $ 729,795 $ 601,134
----------- ------------
Net increase in net assets $ 758,914 $ 708,724
NET ASSETS:
Beginning of year 1,157,087 448,363
----------- ------------
End of year (including accumulated undistributed net
investment income of $2,424 and $3,285, respectively) $1,916,001 $1,157,087
----------- ------------
</TABLE>
<TABLE>
<CAPTION>
'96 Shares '96 Amount '95 Shares '95 Amount
<S> <C> <C> <C> <C>
CLASS A
Shares sold 38,301,967 $ 758,959 31,217,878 $ 560,356
Reinvestment of distributions 4,464,200 82,141 1,416,455 22,168
Less shares repurchased (20,836,196) (408,960) (12,606,807) (229,689)
------------- ----------- ------------- ------------
Net increase 21,929,971 $ 432,140 20,027,526 $ 352,835
------------- ----------- ------------- ------------
CLASS B
Shares sold 16,096,669 $ 314,193 14,855,236 $ 268,700
Reinvestment of distributions 1,465,566 26,703 186,465 2,903
Less shares repurchased (3,623,421) (70,774) (1,277,916) (23,304)
------------- ----------- ------------- ------------
Net increase 13,938,814 $ 270,122 13,763,785 $ 248,299
------------- ----------- ------------- ------------
CLASS C*
Shares sold 1,434,585 $ 28,357
Less shares repurchased (41,811) (824)
------------- -----------
Net increase 1,392,774 $ 27,533
------------- -----------
</TABLE>
*Class C shares were first publicly offered on January 31, 1996.
The accompanying notes are an integral part of these financial statements.
18
<PAGE>
Pioneer Capital Growth Fund
FINANCIAL HIGHLIGHTS 10/31/96
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended
10/31/96 10/31/95 10/31/94
<S> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 19.42 $ 17.26 $ 16.17
------------ ---------- ----------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.08 $ 0.08 $ (0.05)
Net realized and unrealized gain on investments 2.31 3.03 2.80
------------ ---------- ----------
Net increase from investment operations $ 2.39 $ 3.11 $ 2.75
Distributions to shareholders from:
Net investment income (0.09) -- --
Net realized gain (1.87) (0.95) (1.66)
------------ ---------- ----------
Net increase in net asset value $ 0.43 $ 2.16 $ 1.09
------------ ---------- ----------
Net asset value, end of year $ 19.85 $ 19.42 $ 17.26
------------ ---------- ----------
Total return* 13.12% 19.32% 19.03%
Ratio of net expenses to average net assets 1.02%+ 1.16% + 1.26%
Ratio of net investment income (loss) to average net assets 0.43%+ 0.53% + (0.44)%
Portfolio turnover rate 37% 59% 47%
Average commission rate paid(1) $ 0.0518 -- --
Net assets, end of year (in thousands) $1,299,611 $845,415 $405,904
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.00% 1.14% --
Net investment income 0.45% 0.55% --
</TABLE>
<TABLE>
<CAPTION>
Year Ended Year Ended
10/31/93 10/31/92
<S> <C> <C>
CLASS A
Net asset value, beginning of year $ 12.42 $ 11.58
------------ ----------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.02) $ (0.01)
Net realized and unrealized gain on investments 4.43 1.21
------------ ----------
Net increase from investment operations $ 4.41 $ 1.20
Distributions to shareholders from:
Net investment income -- (0.04)
Net realized gain (0.66) (0.32)
------------ ----------
Net increase in net asset value $ 3.75 $ 0.84
------------ ----------
Net asset value, end of year $ 16.17 $ 12.42
------------ ----------
Total return* 36.59% 10.88%
Ratio of net expenses to average net assets 1.27% 1.48%
Ratio of net investment income (loss) to average net assets (0.26)% (0.20)%
Portfolio turnover rate 68% 62%
Average commission rate paid(1) -- --
Net assets, end of year (in thousands) $194,670 $75,796
Ratios assuming reduction for fees paid indirectly:
Net expenses -- --
Net investment income -- --
</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 sale charges were taken into
account.
+ Ratio assuming no reduction for fees paid indirectly.
(1) Amount represents the rate of commission paid per share on the Fund's
exchange listed security transactions.
The accompanying notes are an integral part of these financial statements.
19
<PAGE>
Pioneer Capital Growth Fund
FINANCIAL HIGHLIGHTS 10/31/96
<TABLE>
<CAPTION>
Year Ended Year Ended 4/4/94 to
10/31/96 10/31/95 10/31/94
<S> <C> <C> <C>
CLASS B
Net asset value, beginning of period $ 19.20 $ 17.20 $ 14.94
---------- ---------- -----------
Increase (decrease) from investment
operations:
Net investment loss $ (0.04) $ (0.01) $ (0.04)
Net realized and unrealized gain on
investments 2.26 2.96 2.30
---------- ---------- -----------
Net increase from investment operations $ 2.22 $ 2.95 $ 2.26
Distributions to shareholders:
In excess of net investment income (0.02) -- --
Net realized gain (1.87) (0.95) --
---------- ---------- -----------
Net increase in net asset value $ 0.33 $ 2.00 $ 2.26
---------- ---------- -----------
Net asset value, end of period $ 19.53 $ 19.20 $ 17.20
---------- ---------- -----------
Total return* 12.27% 18.42% 15.13%
Ratio of net expenses to average net assets 1.79%+ 1.93% + 2.04%**
Ratio of net investment loss to average net
assets (0.35)%+ (0.18)%+ (1.12)%**
Portfolio turnover rate 37% 59% 47%
Average commission rate paid(1) $ 0.0518 -- --
Net assets, end of period (in thousands) $589,188 $311,672 $42,459
Ratios assuming reduction for fees paid
indirectly:
Net expenses 1.78% 1.88% --
Net investment loss (0.34)% (0.13)% --
</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 sale charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
(1) Amount represents the rate of commission paid per share on the Fund's
exchange listed security transactions.
The accompanying notes are an integral part of these financial statements.
20
<PAGE>
Pioneer Capital Growth Fund
FINANCIAL HIGHLIGHTS 10/31/96
1/31/96 to
10/31/96
CLASS C(a)
Net asset value, beginning of period $ 18.69
------------
Increase (decrease) from investment operations:
Net investment loss $ (0.02)
Net realized and unrealized gain on investments
and foreign currency transactions 0.86
------------
Net increase in net asset value $ 0.84
------------
Net asset value, end of period $ 19.53
------------
Total return* 4.50%
Ratio of net expenses to average net assets 1.79%**+
Ratio of net investment loss to average net assets (0.39)%**+
Portfolio turnover rate 37%
Average commission rate paid(1) $0.0518
Net assets, end of period (in thousands) $27,202
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.74%**
Net investment loss (0.34)%**
(a) Class C shares were first publicly offered on January 31, 1996.
* 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 sale charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
(1) Amount represents the rate of commission paid per share on the Fund's
exchange listed security transactions.
The accompanying notes are an integral part of these financial statements.
21
<PAGE>
Pioneer Capital Growth Fund
NOTES TO FINANCIAL STATEMENTS 10/31/96
1. Organization and Significant Accounting Policies
Pioneer Capital Growth Fund (the Fund), one of three funds that composes
Pioneer Growth Trust, is a Massachusetts business trust registered under the
Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objective of the Fund is to seek capital
appreciation by investing in a diversified portfolio of securities consisting
primarily of common stocks.
The Fund offers three classes of shares - Class A, Class B and Class C
shares. Class C shares were first publicly offered on January 31, 1996.
Shares of Class A, Class B and Class C each represent an interest in the same
portfolio of investments of the Fund and have equal voting rights,
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 Fund's financial statements have been prepared in conformity with
generally accepted accounting principles that require the management of the
Fund 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 Fund, which
are in conformity with those generally accepted in the investment company
industry:
A. Security Valuation
Security transactions are recorded on trade date. Each day, securities are
valued at the last sale price on the principal exchange where they are
traded. Securities that have not traded on the date of valuation, or
securities for which sale prices are not generally reported, are valued at
the mean between the last bid and asked prices. Securities for which market
quotations are not readily available are valued at their fair values as
determined by, or under the direction of, the Board of Trustees. Temporary
cash investments are valued at amortized cost. Dividend income is recorded
on the ex-dividend date and interest income is recorded on the accrual
basis.
Gains and losses from sales of investments are calculated on the "identified
cost" method for both financial reporting and federal income tax
22
<PAGE>
purposes. It is the Fund's practice first to 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 Fund'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 Fund'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 Fund 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 Fund and an
indirect wholly owned subsidiary of The Pioneer Group, Inc. (PGI). PFD
earned approximately $1,940,000 in underwriting commissions on the sale of
fund shares during the year ended October 31, 1996.
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 Fund,
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 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 Fund level and allocated daily to each class of shares
based on the respective percentage of adjusted net assets at the beginning
of the day.
Distributions to shareholders are recorded as of the ex-dividend date.
Distributions paid by the Fund, if any, with respect to each class of shares
are calculated in the same manner, at the same time, on the
23
<PAGE>
same day and in the same amount, except that Class A, Class B, and Class C
shares bear different transfer agent and distribution fees.
2. Management Agreement
Pioneering Management Corporation (PMC), the Fund's investment adviser,
manages the Fund's portfolio and is a wholly owned subsidiary of PGI.
Management fees are calculated daily at the annual rate of 0.65% of the
Fund's average daily net assets up to $300 million; 0.60% of the next $200
million; 0.50% of the next $500 million; and 0.45% of the excess over $1
billion.
In addition, under the management agreement, certain other services and
costs, including accounting, regulatory reporting and insurance premiums, are
paid by the Fund. At October 31, 1996, approximately $845,000 were payable to
PMC related to management fees and certain other services.
3. Transfer Agent
PSC, a wholly owned subsidiary of PGI, provides substantially all transfer
agent and shareholder services to the Fund at negotiated rates. Included in
due to affiliates is approximately $359,000 in transfer agent fees payable to
PSC at October 31, 1996.
4. Distribution Plans
The Fund 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 Fund pays
PFD a service fee of up to 0.25% of the Fund'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 Class C Plan, the Fund 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
approximately $803,000 in distribution fees payable to PFD at October 31,
1996.
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
certain net asset value purchases of Class A shares that are redeemed 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
24
<PAGE>
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 CDSC are paid to PFD. For the year ended
October 31, 1996, CDSC in the amount of approximately $856,000 was paid to
PFD.
5. Expense Offsets
The Fund has entered into certain directed brokerage and expense offset
arrangements resulting in a reduction in the Fund's total expenses. For the
year ended October 31, 1996, the Fund's expenses were reduced by
approximately $292,000 under such arrangements.
6. Affiliated Companies
The Fund invests in smaller capitalized company securities that tend to be
more sensitive to changes in earnings expectations and have lower trading
volumes than mid- to large-capitalized company securities, and as a result,
they may experience more abrupt and erratic price movements. The Fund's
investment in these smaller capitalized companies may exceed 5% of the
outstanding voting stock. Such companies are deemed affiliates of the Fund
for financial reporting purposes. The following summarizes transactions with
affiliates of the Fund as of October 31, 1996:
<TABLE>
<CAPTION>
Dividend
Affiliates Purchases Sales Income Value
-------------------------------- ------------- ------------ --------- --------------
<S> <C> <C> <C> <C>
AFC Cable Systems $11,225,500 $ - $ - $12,984,125
Alkermes, Inc. 4,564,563 325,000 - 15,555,500
American Healthcorp, Inc. 5,663,290 - - 7,063,612
Amtech Corp. 11,166,777 - - 7,842,425
Avondale Industries, Inc. 4,886,288 1,345,062 - 19,641,813
BancTec, Inc. 26,713,075 - - 31,369,350
Banyan Systems, Inc. 18,296,562 - - 6,635,063
Best Products Corp., Inc. 10,593,825 11,613,392 - 54,079
BioWhittaker, Inc. 8,702,252 - - 7,638,000
Bluegreen Corp. 6,497,306 - - 5,794,139
Catalytica, Inc. 7,226,750 - - 7,143,563
Coastal Physicial
Group, Inc. 24,397,190 - - 11,456,550
CrossCom Corp. 7,941,152 825,000 - 4,089,750
Ethical Holdings, Plc
(Sponsored A.D.R.) 7,420,736 - - 4,809,375
Ferrofluidics Corp. 3,662,091 1,973,275 - 3,065,250
Fingerhut Companies, Inc. 34,879,321 - 304,188 37,157,750
25
<PAGE>
Future
Communications, Inc. $ 2,762,500 $ - $ - $ 18,125
Galey & Lord, Inc. 15,976,991 227,664 - 16,272,600
Gehl Co. 1,037,838 476,063 - 2,586,400
Genesco Inc. 6,312,151 - - 14,364,000
Gryphon Holdings, Inc. 11,025,000 - - 9,322,500
Guilford Mills, Inc. 20,075,295 - 303,780 20,892,875
ImClone Systems, Inc. 2,391,250 103,125 - 12,247,500
Insilco Corp. 20,382,506 - - 29,008,200
Instron Corp. 6,402,289 - 73,876 6,996,250
Justin Industries 23,186,496 - - 20,332,925
Ladd Furniture, Inc. 10,407,395 - 27,882 9,630,474
Levitz Furniture, Inc. 13,495,420 - - 5,655,300
Lone Star Industries, Inc. 16,198,966 - - 29,951,250
Marcam Corp. 11,666,537 - - 13,695,500
Micro Focus Group Plc
(Sponsored A.D.R.) 19,524,929 3,680,248 - 21,228,000
Paragon Trade Brands, Inc. 18,741,565 386,978 - 28,523,250
Park Ohio Industries, Inc. 13,312,369 - - 16,275,000
Sepracor, Inc. 13,639,798 - - 18,045,625
Sudbury, Inc. 5,506,025 686,250 - 10,181,250
Supreme Industries, Inc. 4,007,050 - - 4,240,280
TBC Corp. 16,581,854 - - 13,562,038
The Lamson
& Sessions Co. 7,339,690 - - 8,975,375
Tultex Corp. 8,551,624 - - 10,958,350
Walker Interactive
Systems, Inc. 7,552,511 762,488 - 15,413,725
Whittaker Corp. 20,609,910 - - 14,930,125
Worldtex, Inc. 7,951,663 28,080 - 11,377,013
Zapata Corp. 7,534,079 - - 6,860,625
------------- ------------ --------- --------------
$506,010,379 $22,432,625 $709,726 $553,844,899
------------- ------------ --------- --------------
</TABLE>
26
<PAGE>
Pioneer Capital Growth Fund
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To The Shareholders and The Board of Trustees of Pioneer
Capital Growth Fund:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer Capital Growth Fund (one of the portfolios
constituting Pioneer Growth Trust) as of October 31, 1996, 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 Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 1996, 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 Capital Growth Fund (of Pioneer Growth Trust) as of October 31, 1996,
the results of its operations, the changes in its net assets, and the
financial highlights for the period presented, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
December 4, 1996
27
<PAGE>
Pioneer Capital Growth Fund
TAX TREATMENT OF DISTRIBUTIONS
Made during the Year Ended 10/31/96
During the year ended October 31, 1996, Pioneer Capital Growth Fund paid the
following distributions per share:
Net
Net Realized Gain
Investment -------------------------
Record Date Payment Date Income Short-Term Long-Term
CLASS A:
12/20/95 12/28/95 $0.088 $1.158 $0.716
CLASS B:
12/20/95 12/28/95 $0.016 $1.158 $0.716
On a per share basis, distributions to Class A and Class B shareholders from
net realized gain include $0.716, which should be reported as long-term
capital gain. The remaining $1.158 should be combined with the $0.088 and
$0.016 distribution from net investment income for Class A and Class B,
respectively, for a total of $1.246 and $1.174, respectively, which
represents ordinary income.
Corporate shareholders may deduct up to 70% of qualifying dividends received
during the year. For purposes of computing the exclusion, 100% of the
distributions from net investment income represents qualifying dividends.
The Fund hereby designates $50,031,827 as a capital gain dividend for the
purposes of the dividend paid deduction.
28
<PAGE>
Pioneer Capital Growth Fund
TRUSTEES' FEES AND SHARE OWNERSHIP 10/31/96
Trustees' Fees, Principal Shareholders and Share
Ownership of Trustees and Officers (Unaudited)
The aggregate direct remuneration paid by the Fund to nonaffiliated trustees
and officers during the period ended October 31, 1996 was approximately
$24,000, plus expenses incurred in attending trustees meetings of $3,000.
Fees of trustees who are affiliated with or "interested persons" of
Pioneering Management Corporation and Pioneer Funds Distributor, Inc.,
investment advisor and principal underwriter, respectively, of the Fund ($300
in 1996), are reimbursed to the Fund by Pioneering Management Corporation in
accordance with the management agreement with the Fund. At October 31, 1996,
the trustees and officers of the Fund owned beneficially approximately 20,000
of Class A shares of the Fund (.03% of the outstanding Class A shares). The
Pioneer Group, Inc., the parent company of Pioneering Management Corporation
and Pioneer Funds Distributor, Inc., is a publicly-held corporation of which
Mr. Cogan, Chairman and President of the Fund, owned approximately 14% of the
outstanding shares of capital stock at October 31, 1996.
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Pioneer Capital Growth Fund
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
Trustees
John F. Cogan, Jr.
Richard H. Egdahl, M.D.
Margaret B.W. Graham
John W. Kendrick
Marguerite A. Piret
David D. Tripple
Stephen K. West
John Winthrop
Officers
John F. Cogan, Jr., Chairman and President
David D. Tripple, Executive Vice President
Warren J. Isabelle, Vice President
William H. Keough, Treasurer
Joseph P. Barri, Secretary
Investment Adviser
Pioneering Management Corporation
Custodian
Brown Brothers Harriman & Co.
Independent Public Accountants
Arthur Andersen LLP
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr
Shareholder Services and Transfer Agent
Pioneering Services Corporation
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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 1-800-225-6292.
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.
90-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.
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Automatic Exchange Program
A simple way to move money from a money market or bond fund into a stock fund
over a period of time. Just invest a lump sum in a Pioneer money market fund
or bond fund. Then, select the Pioneer equity fund or funds you wish to
invest in, and choose the amounts and dates for Pioneer to sell shares of
your money market or bond fund and use the proceeds to buy shares of the
Pioneer equity fund you have chosen. Over time, your original investment will
be shifted to your Pioneer equity fund.
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 only for accounts with a value of
$10,000 or more.)
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This page for your notes.
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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
Global/International
Pioneer Emerging Markets Fund
Pioneer Europe Fund
Pioneer Gold Shares
Pioneer India Fund
Pioneer International Growth Fund
Pioneer World Equity Fund
United States
Pioneer Capital Growth Fund
Pioneer Growth Shares
Pioneer Mid-Cap Fund
Pioneer Small Company Fund
Growth and Income Funds
Pioneer Equity-Income Fund
Pioneer Fund
Pioneer Real Estate Shares
Pioneer II
Income Funds
Taxable
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer Income Fund
Pioneer Short-Term Income Trust*
Tax-Exempt
Pioneer Intermediate Tax-Free Fund
Pioneer Tax-Free Income Fund
Money Market Fund
Pioneer Cash Reserves Fund
*Offers Class A and B Shares only
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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.
You can 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
Or write to us at:
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)
This report must be preceded or accompanied by a current
Fund prospectus.
[Pioneer logo]
Pioneer Funds Distributor, Inc.
60 State Street
Boston, Massachusetts 02109
1296-3829
(c) Pioneer Funds Distributor, Inc.
[recycled logo] Printed on Recycled Paper
