<PAGE>
[PIONEER LOGO]
Pioneer
Equity-Income
Fund
SEMIANNUAL REPORT
APRIL 30, 1996
PIONEER EQUITY-INCOME FUND
60 State Street
Boston, Massachusetts 02109
OFFICERS
JOHN F. COGAN, JR., Chairman and President
DAVID D. TRIPPLE, Executive Vice President
JOHN A CAREY, Vice President
WILLIAM H. KEOUGH, Treasurer
JOSEPH P. BARRI, Secretary
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
INVESTMENT ADVISER
PIONEERING MANAGEMENT
CORPORATION
PRINCIPAL UNDERWRITER
PIONEER FUNDS
DISTRIBUTOR, INC.
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
INDEPENDENT PUBLIC
ACCOUNTANTS
ARTHUR ANDERSEN LLP
LEGAL COUNSEL
HALE AND DORR
SHAREHOLDER SERVICES AND TRANSFER AGENT
PIONEERING SERVICES CORPORATION
60 State Street
Boston, Massachusetts 02109
- ---------------------------------------------------------
Please call Pioneer for information on:
Existing accounts, new accounts,
prospectuses, applications,
and service forms .........................1-800-225-6292
Fund yields and prices ....................1-800-225-4321
Toll-free fax .............................1-800-225-4240
Retirement plans ..........................1-800-622-0176
Telecommunications Device for the
Deaf (TDD) ................................1-800-225-1997
- ----------------------------------------------------------
When distributed to persons who are not shareowners of the Fund, this report
must be accompanied by an official prospectus, that discusses the objectives,
policies, sales charges and other information about the Fund.
0696-3428
(c)Pioneer Funds Distributor, Inc.
<PAGE>
Dear Shareowner,
It is hard to believe that Pioneer Equity-Income has already reached the
middle of its seventh fiscal year! Once again, the United States' stock
market is shaping up as a pretty good place to have one's investment dollars.
However, in recent months an upward movement in interest rates and
commodities prices has caused concern that corporate earnings growth could
slow. Interest-rate sensitive industries, including utilities and financial
services, have been particular worries for investors, but industrial stocks
and even high-growth technology issues have also come under scrutiny. In
short, investors, while still generally bullish, became more cautious as your
Fund's semiannual period progressed through April 30.
How Your Fund Performed
Your Fund achieved the following results for the six months ended April 30,
1996:
Class A Shares
(bullet) Net asset value stood at $19.75 per share on April 30, 1996, versus
$18.22 at October 31, 1995.
(bullet) Shareowners received income dividends totaling $0.2473 per share,
along with a $0.1418 per share capital gains distribution paid in
December 1995.
(bullet) The Fund's dividend yield on Class A shares continued to outpace
that of the unmanaged Standard & Poor's (S&P) 500 Index. We are
pleased to state that we have met our goal of consistently exceeding
the yield on the S&P 500 since the Fund's inception.
(bullet) Assuming reinvestment of all distributions during the period, the
increase in share value translated into a total return of 10.60% for
the six months at net asset value and 4.25% at maximum public
offering price.
Class B Shares
(bullet) Net asset value was $19.65 per share on April 30, 1996, versus
$18.15 per share at October 31, 1995.
(bullet) Shareowners received income dividends totaling $0.2045 per share,
along with a $0.1418 per share capital gains distribution paid in
December 1995.
(bullet) Assuming reinvestment of all distributions during the period, the
increase in share value contributed to a total return of 10.23% for
the six months, assuming shares were held the entire six months. If
shares were sold at the end of the period, and the maximum 4%
contingent deferred sales charge deducted, total return would have
been 6.23%.
Class C Shares
The Fund introduced Class C shares on January 31, 1996. Since then, they
achieved the following results:
(bullet) Net asset value was $19.66 per share on April 30, 1996, versus the
introductory $19.49.
(bullet) Shareowners received income dividends totaling $0.09 per share
through April 30.
(bullet) Assuming reinvestment of all distributions during the period, the
increase in share value contributed to a total return of 1.33% for
the abbreviated period, assuming shares were held throughout. If
shares were sold and the 1% sales charge deducted at the end of the
period, total return would have been 0.33%.
By comparison, the unmanaged Standard & Poor's 500 Index showed a total
return of 13.75% for the six months through April 30. The return on the S&P
500 reflects the results of many stocks that are ineligible for inclusion in
your Fund's portfolio due to their insufficient dividend income. The
accompanying table shows the Fund's results for longer time periods.
<PAGE>
- ----------------------------------------------------------------
Average Annual Total Returns
(As of April 30, 1996)
Class A Shares
Net Public
Period Asset Value Offering Price*
- ------------------------- ------------ ------------------
Life of Fund (7/25/90) 14.44% 13.26%
5 Years 15.66 14.31
1 Year 26.39 19.10
Class B Shares
Period If Held If Redeemed**
- ------------------------- ---------- ----------------
Life of Fund (4/4/94) 16.97% 15.74%
1 Year 25.53 21.53
- -----------------------------------------------------------------
Review of Investment Activity
We are very pleased to report that Fund assets continued to grow, nearing
$420 million on April 30, an increase of more than one-third from October 31,
1995. Importantly, the growth in assets resulted from both appreciation of
portfolio holdings and new purchases of Fund shares. The added assets,
together with a very active stock market, permitted us to make a large number
of changes in the portfolio. We continued our drive to reduce the number of
positions by adding 15 securities while eliminating 34, a net reduction of
19. Many of the positions eliminated, some dating back to the Fund's early
years, were smaller holdings we believed were not suitable for the additional
investments needed to make them meaningful to the Fund today. In a few other
cases, we decided that other investments were more attractive. There also was
one large merger in the portfolio. FirsTier Financial was acquired by First
Bank System; we retained the First Bank stock received in exchange for
FirsTier.
Looking at sectors, we increased holdings in consumer durables from 7.9% to
10.6% by increasing investments in the "Big Three" auto manufacturers,
Chrysler, Ford and General Motors. With better consumer confidence and a
stronger economy, the outlook appears brighter for these companies, which
also pay attractive dividends. Within energy, we added oil services
companies, most importantly Schlumberger. Financial holdings show new
diversification into insurance with the addition of Chubb, SAFECO and St.
Paul, all high-quality property and casualty companies. We sharply increased
pharmaceutical exposure by adding Bristol-Myers Squibb and purchasing more
Schering-Plough. Finally, we kept reducing holdings in electric, gas and
water utilities and expanding investments in telecommunications. While there
may again be opportunities in the other utility sectors, we continue to favor
telephone utilities for the greater growth in demand for their services.
Looking Ahead
The economic clouds we mentioned in the Fund's October annual report have not
altogether cleared. While the economy appears to be doing pretty well, that
strength has prompted concerns over interest rates and inflation. As always,
we look at individual stocks and evaluate each on its merits and market
valuation. Currently, a particular challenge is achieving adequate dividend
income while the overall dividend yield on stocks, as measured by the S&P
500, is near an all-time low of barely over 2%. We are looking across many
industry lines for dividends, and we are also emphasizing investments in
companies that offer not only good expected dividend yields, but also the
capability and stated policy of increasing their dividends regularly.
On the next few pages you will see the Fund's audited Schedule of
Investments, as well as audited financial statements, as of April 30, 1996.
Please call your investment representative with any questions you have about
Pioneer Equity-Income Fund, or call Pioneer directly at 1-800-225-6292. We
appreciate your support.
Respectfully,
/s/ John F. Cogan, Jr.
- ---------------------------------
John F. Cogan, Jr.
Chairman and President,
Pioneer Equity-Income Fund
________________________
* Reflects deduction of the maximum 5.75% sales charge at the beginning of
the period and assumes reinvestment of distributions at net asset value.
** Reflects deduction of the maximum 4.0% contingent deferred sales charge at
the end of the period and assumes reinvestment of distributions.
Past performance does not guarantee future results. Return and principal
fluctuate so that an investor's shares, when redeemed, may be worth more
or less than their original cost.
2
<PAGE>
SCHEDULE OF INVESTMENTS--PIONEER EQUITY-INCOME FUND--APRIL 30, 1996
<TABLE>
<CAPTION>
Principal
Amount Value
- ----------- -----------
<S> <C> <C>
INVESTMENT IN SECURITIES--100%
CONVERTIBLE CORPORATE BONDS--0.6%
$1,000,000 EMC Corp., Sub. Deb., 4.25%, 2001 $1,147,500
1,310,000 Guilford Mills Inc., Sub. Deb., 6.00%, 2012 1,255,963
---------
TOTAL CONVERTIBLE CORPORATE BONDS (Cost $2,442,500) $2,403,463
---------
<CAPTION>
Shares
- -----------
<S> <C> <C>
CONVERTIBLE PREFERRED STOCKS--3.7%
75,000 Delta Air Lines, Inc., $3.50, Series C $ 4,753,125
70,000 Reynolds Metals, 7.00% 3,368,750
132,400 Rouse Co., 6.50%, Series A 7,282,000
1,840 Stepan Co., 5.50% 34,960
---------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Cost $14,188,241) $15,438,835
---------
COMMON STOCKS--95.7%
BASIC INDUSTRIES--9.2%
Chemicals--3.6%
147,524 ARCO Chemical Co. $ 7,837,212
136,300 Borden Chemicals and Plastics, L.P. 1,840,050
66,500 E.I. du Pont de Nemours and Co. 5,344,938
---------
$15,022,200
---------
Iron & Steel--1.1%
348,937 Roanoke Electric Steel Corp. $ 4,623,415
---------
Metals & Mining--3.2%
13,800 Great Northern Iron Ore Properties CBI $ 648,600
170,600 Phelps Dodge Corp. 12,539,100
---------
$13,187,700
---------
Paper Products--1.3%
100,000 Union Camp Corp. $ 5,437,500
---------
TOTAL BASIC INDUSTRIES $38,270,815
---------
CAPITAL GOODS--5.4%
Producer Goods--5.4%
556,557 The Gorman-Rupp Co.+ $ 8,209,216
24,700 Johnson Controls, Inc. 1,766,050
8,000 Manitowoc Company Inc. 272,000
63,000 Minnesota Mining & Manufacturing Co. 4,142,250
52,600 Timken Co. 2,084,275
330,000 Westinghouse Electric Corp. 6,228,750
---------
TOTAL CAPITAL GOODS $22,702,541
---------
CONSUMER DURABLES--10.6%
Motor Vehicles--10.6%
185,150 Chrysler Corp. $11,618,162
563,800 Ford Motor Co. 20,226,325
224,700 General Motors Corp. 12,189,975
---------
TOTAL CONSUMER DURABLES $44,034,462
---------
CONSUMER NON-DURABLES--9.9%
Agriculture & Food--5.8%
135,900 CPC International, Inc. $ 9,394,087
147,750 H.J. Heinz Co. 5,005,031
180,000 Quaker Oats Co. 6,187,500
117,300 Sara Lee Corp. 3,636,300
---------
$24,222,918
---------
Consumer Luxuries--1.4%
162,000 Cedar Fair, L.P. $ 5,791,500
---------
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
Shares Value
- ----------- ---------
<S> <C> <C>
Retail Non-Food--2.7%
60,000 J.C. Penney Co., Inc. $ 2,970,000
124,000 May Department Stores Co. 6,324,000
30,000 Mercantile Stores Co., Inc. 1,871,250
---------
$11,165,250
---------
TOTAL CONSUMER NON-DURABLES $41,179,668
---------
ENERGY--5.1%
Oil & Gas Extraction--3.7%
78,500 Amoco Corp. $ 5,730,500
114,000 Chevron Corp. 6,612,000
65,700 Lakehead Pipeline Partners, L.P. 1,798,538
11,500 Mobil Corp. 1,322,500
---------
$15,463,538
---------
Oil Services--1.4%
50,300 Buckeye Partners, L.P. $ 1,936,550
28,800 Santa Fe Pacific Pipeline Partners, L.P. 1,076,400
30,000 Schlumberger Ltd. 2,647,500
---------
$ 5,660,450
---------
TOTAL ENERGY $21,123,988
---------
FINANCIAL--18.0%
Commercial Banks--13.8%
103,100 AmSouth Bancorp $ 3,956,463
117,400 Bank of New York Co., Inc. 5,693,900
95,000 Boatmen's Bancshares, Inc. 3,681,250
157,500 CoreStates Financial Corp. 6,142,500
152,565 First Bank System, Inc. 9,192,041
270,000 First Security Corp. 6,817,500
150,000 First Tennessee National Corp. 4,950,000
162,781 Huntington Bancshares, Inc. 3,947,439
108,000 National City Corp. 3,982,500
201,127 Old Kent Financial Corp. 7,542,262
65,000 Southtrust Corp. 1,763,125
---------
$57,668,980
---------
Insurance--General--3.9%
40,000 Chubb Corp. $ 3,785,000
220,500 Safeco Corp. 7,276,500
103,100 St. Paul Companies, Inc. 5,477,188
---------
$16,538,688
---------
Investments--0.3%
36,900 Eaton Vance Corp. $ 1,125,450
---------
TOTAL FINANCIAL $75,333,118
---------
SERVICES--8.1%
Health & Personal Care--1.1%
89,700 U.S. Healthcare, Inc. $ 4,675,612
---------
Publishing--2.0%
78,500 Dun & Bradstreet Corp. $ 4,778,688
80,000 McGraw-Hill Companies, Inc. 3,530,000
---------
$ 8,308,688
---------
Pharmaceuticals--5.0%
40,000 Bristol-Myers Squibb Co. $ 3,290,000
305,400 Schering-Plough Corp. 17,522,325
---------
$20,812,325
---------
TOTAL SERVICES $33,796,625
---------
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
Shares Value
- ----------- ---------
<S> <C> <C>
TECHNOLOGY--3.2%
Business Machines--1.1%
44,000 IBM Corp. $ 4,730,000
---------
Electronics--2.1%
134,900 Diebold, Inc. $ 5,193,650
92,000 Thomas & Betts Corp. 3,622,500
---------
$ 8,816,150
---------
TOTAL TECHNOLOGY $ 13,546,150
---------
TRANSPORTATION--1.4%
Railroad & Bus--1.4%
71,600 Norfolk Southern Corp. $ 6,014,400
---------
TOTAL TRANSPORTATION $ 6,014,400
---------
UTILITIES--24.8%
Electric Utility--1.0%
147,100 Allegheny Power System, Inc. $ 4,302,675
---------
Gas Utility--1.2%
55,300 Brooklyn Union Gas Co. $ 1,451,625
85,950 Indiana Energy, Inc. 2,052,056
98,000 Public Service Co. of North Carolina, Inc. 1,580,250
---------
$ 5,083,931
---------
Telecommunications--21.8%
227,000 Ameritech Corp. $ 13,251,125
238,600 Bell Atlantic Corp. 15,509,000
158,200 BellSouth Corp. 6,328,000
169,700 Frontier Corp. 5,366,763
124,000 GTE Corp. 5,378,500
275,500 Lincoln Telecommunications Co. 4,683,500
246,500 NYNEX Corp. 12,109,312
220,000 Pacific Telesis Group 7,535,000
283,000 SBC Communications, Inc. 14,150,000
199,877 U.S. West, Inc. 6,545,972
---------
$ 90,857,172
---------
Utility/Other--0.8%
75,200 American Water Works, Inc. $ 2,857,600
20,500 E'Town Corp. 561,188
---------
$ 3,418,788
---------
TOTAL UTILITIES $103,662,566
---------
TOTAL COMMON STOCKS (Cost $337,692,140) $399,664,333
---------
TOTAL INVESTMENT IN SECURITIES
(Cost $354,322,881) (a) $417,506,631
=========
</TABLE>
- -------------------------------------------------------------------------------
+ Investments held representing 5% or more of the outstanding voting stock of
such company (see Note 6).
(a) At April 30, 1996, the net unrealized gain on investments based on cost
for federal income tax purposes of $354,322,881 was as follows:
Aggregate gross unrealized gain for all investments in which there is an
excess of value over tax cost .................. ............$65,637,059
Aggregate gross unrealized loss for all investments in which there is an
excess of tax cost over value ................................(2,453,309)
-----------
Net unrealized gain......................................... $63,183,750
--------------------------------------------------------------------------
Purchases and sales of securities (excluding temporary cash investments)
for the six months ended April 30, 1996 aggregated $152,854,480 and
$73,296,863, respectively.
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PIONEER EQUITY-INCOME FUND
BALANCE SHEET--April 30,1996
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (cost $354,322,881; see
Schedule of Investments and Notes 1 and 6) $417,506,631
Cash 203,981
Receivables--
Investment securities sold 268,916
Fund shares sold 2,620,757
Dividends and Interest 1,442,581
Other 3,442
-----------
Total assets $422,046,308
-----------
LIABILITIES:
Payables--
Investment securities purchased $ 751,175
Fund shares repurchased 997,802
Due to affiliates (Notes 2, 3 and 4) 259,313
Accrued expenses 47,506
-----------
Total liabilities $ 2,055,796
-----------
NET ASSETS:
Paid-in capital (Note 1) $350,918,472
Accumulated undistributed net investment income (Note 1) 1,038,785
Accumulated undistributed net realized gain on
investments (Note 1) 4,849,505
Net unrealized gain on investments 63,183,750
-----------
Total net assets $419,990,512
===========
NET ASSET VALUE PER SHARE:
Class A--(based on $311,494,155 / 15,771,862 shares of
beneficial interest outstanding--unlimited number of
shares authorized) $19.75
======
Class B--(based on $107,030,203 / 5,446,381 shares of
beneficial interest outstanding--unlimited number of
shares authorized) $19.65
======
Class C--(based on $1,466,154 / 74,575 shares of
beneficial interest outstanding--unlimited number of
shares authorized) $19.66
======
MAXIMUM OFFERING PRICE:
Class A $20.95
======
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
PIONEER EQUITY-INCOME FUND
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME (NOTE 1):
Dividends $7,538,623
Interest 155,242
-------
Total investment income $ 7,693,865
----------
EXPENSES:
Management fees (Note 2) $1,182,628
Transfer agent fees (Note 3)
Class A 281,192
Class B 83,484
Class C 590
Distribution fees (Note 4)
Class A 355,829
Class B 421,846
Class C 1,570
Registration fees 124,808
Custodian fees 36,641
Professional fees 23,842
Accounting (Note 2) 35,490
Printing 24,752
Fees and expenses of nonaffiliated trustees 9,460
Miscellaneous 15,090
-------
Total expenses $ 2,597,222
Less fees paid indirectly (Note 5) (27,731)
----------
Net expenses $ 2,569,491
----------
Net investment income $ 5,124,374
----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments (Note 1) $ 4,973,144
Change in net unrealized gain on investments 24,569,307
----------
Net gain on investments $29,542,451
----------
Net increase in net assets resulting from operations $34,666,825
==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
PIONEER EQUITY-INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the Six Months Ended April 30, 1996 and the Year Ended October 31, 1995
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
April 30, October 31,
1996 1995
----------- ---------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 5,124,374 $ 7,581,927
Net realized gain on investments 4,973,144 2,578,622
Change in net unrealized gain on investments 24,569,307 35,460,573
--------- -----------
Net increase in net assets resulting from operations $ 34,666,825 $ 45,621,122
--------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A ($0.25 and $0.53 per share, respectively) $ (3,653,277) $ (6,559,110)
Class B ($0.20 and $0.45 per share, respectively) (903,357) (866,524)
Class C ($0.09 per share) (3,522) --
Net realized gain
Class A ($0.14 and $0.40 per share, respectively) (2,023,138) (4,472,881)
Class B ($0.14 and $0.40 per share, respectively) (557,696) (399,279)
--------- -----------
Decrease in net assets resulting from distributions to shareholders $ (7,140,990) $(12,297,794)
--------- -----------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $119,746,881 $136,750,005
Net asset value of shares issued to shareholders in reinvestment of dividends 6,575,068 11,369,138
Cost of shares repurchased (44,271,422) (59,634,245)
--------- -------------
Net Increase in net assets resulting from fund share transactions $ 82,050,527 $ 88,484,898
--------- -------------
Net increase in net assets $109,576,362 $121,808,226
NET ASSETS:
Beginning of period 310,414,150 188,605,924
--------- -------------
End of period (including accumulated undistributed net investment income of
$1,038,785 and $474,567, respectively) $419,990,512 $310,414,150
========= =============
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1996 October 31,1995
------------------------- ---------------------------
Shares Amount Shares Amount
---------- ----------- ---------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold 3,587,727 $ 69,470,444 5,290,568 $ 87,988,000
Shares issued to shareholders in reinvestment of distributions 273,507 5,267,500 645,020 10,214,521
Less shares repurchased (1,811,748) (35,050,599) (3,101,300) (51,919,543)
-------- --------- -------- -----------
Net increase 2,049,486 $ 39,687,345 2,834,288 $ 46,282,978
======== ========= ======== ===========
CLASS B
Shares sold 2,524,823 $ 48,807,768 2,941,211 $ 48,762,005
Shares issued to shareholders in reinvestment of distributions 68,069 1,305,479 71,617 1,154,617
Less shares repurchased (475,314) (9,210,390) (468,458) (7,714,702)
-------- --------- -------- -----------
Net increase 2,117,578 $ 40,902,857 2,544,370 $ 42,201,920
======== ========= ======== ===========
CLASS C*
Shares sold 75,000 $ 1,468,669
Shares issued to shareholders in reinvestment of distributions 106 2,089
Less shares repurchased (531) (10,433)
-------- ---------
Net increase 74,575 $ 1,460,325
======== =========
</TABLE>
* Class C shares were first publicly offered on January 31, 1996.
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
PIONEER EQUITY-INCOME FUND
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding for the Periods Presented
<TABLE>
<CAPTION>
July 25,
Six Months Ended For the Years Ended October 31, 1990 to
April 30, ------------------------------ October 31,
CLASS A 1996 1995 1994 1993 1992 1991 1990
---------------- ------- ------- ------ ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.22 $ 16.16 $ 16.92 $ 14.56 $ 13.25 $ 10.35 $12.50
-------- ----- ----- ----- ---- ----- ------
Increase (decrease) from investment operations:
Net investment income $ 0.28 $ 0.54 $ 0.55 $ 0.50 $ 0.52 $ 0.61 $ 0.22
Net realized and unrealized gain (loss) on
investments 1.64 2.45 (0.54) 2.46 1.57 2.94 (2.24)
------- ----- ----- ----- ---- ----- ------
Total increase (decrease) from investment
operations $ 1.92 $ 2.99 $ 0.01 $ 2.96 $ 2.09 $ 3.55 $(2.02)
Distributions to shareholders from:
Net investment income (0.25) (0.53) (0.54) (0.50) (0.56) (0.65) (0.13)
Net realized gain (0.14) (0.40) (0.23) (0.10) (0.22) -- --
-------- ----- ----- ----- ---- ----- -----
Net increase (decrease) in net asset value $ 1.53 $ 2.06 $ (0.76) $ 2.36 $ 1.31 $ 2.90 $(2.15)
-------- ----- ----- ----- ---- ----- ------
Net asset value, end of period $ 19.75 $ 18.22 $ 16.16 $ 16.92 $ 14.56 $ 13.25 $10.35
======== ===== ===== ===== ==== ===== ======
Total return* 10.60% 19.51% 0.09% 20.71% 16.53% 35.10% (13.40%)
Ratio of net expenses to average net assets 1.23%**+ 1.29%+ 1.24% 1.33% 1.73% 1.75% 1.75%**
Ratio of net investment income to average
net assets 2.94%**+ 3.26%+ 3.43% 3.20% 4.01% 5.54% 8.44%**
Portfolio turnover rate 40.15%** 13.10% 26.67% 13.57% 18.13% 54.37% 3.83%**
Average commission rate paid per exchange listed
transaction $ 0.0586 -- -- -- -- -- --
Net assets, end of period (in thousands) $311,494 $249,981 $175,943 $143,025 $39,269 $10,616 $3,212
Ratios assuming no waiver of fees and
assumption of expenses by PMC:
Net expenses -- -- -- -- 1.77% 2.92% 6.62%**
Net investment income -- -- -- -- 3.97% 4.37% 3.57%**
Ratios assuming reduction for fees
paid indirectly:
Net expenses 1.22%** 1.27% -- -- -- -- --
Net investment income 2.95%** 3.28% -- -- -- -- --
</TABLE>
+ Ratios assuming no reduction for fees paid indirectly.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all 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.
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
PIONEER EQUITY-INCOME FUND
FINANCIAL HIGHLIGHTS
Selected Data for a Share Outstanding for the Periods Presented (Continued)
<TABLE>
<CAPTION>
April 4, 1994
Six Months Ended Year Ended to
April 30, 1996 October 31, 1995 October 31, 1994
CLASS B ---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 18.15 $ 16.14 $ 15.46
------- ------ ------
Increase from investment operations:
Net investment income $ 0.21 $ 0.45 $ 0.21
Net realized and unrealized gain on investments 1.63 2.41 0.71
------- ------ ------
Total increase from investment operations $ 1.84 $ 2.86 $ 0.92
Distributions to shareholders:
From net investment income $ (0.20) $ (0.45) $ (0.21)
In excess of net investment income -- -- (0.03)
From net realized gain (0.14) (0.40) --
-------- ----- ------
Net increase in net asset value $ 1.50 $ 2.01 $ 0.68
------- ----- ------
Net asset value, end of period $ 19.65 $ 18.15 $ 16.14
======= ===== ======
Total return* 10.17% 18.64% 5.93%
Ratio of net expenses to average net assets 1.98%**+ 2.02%+ 1.92%**
Ratio of net investment income to average net assets 2.14%**+ 2.35%+ 2.35%**
Portfolio turnover rate 40.15%** 13.10% 26.67%
Average commission rate paid per exchange listed
transaction $ 0.0586
Net assets, end of period (in thousands) $107,030 $60,433 $12,663
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.96%** 1.98% --
Net investment income 2.16%** 2.39% --
CLASS C*** January 31, 1996
to
April 30, 1996
----------------
Net asset value, beginning of period $ 19.49
-------
Increase from investment operations:
Net investment income $ 0.08
Net realized and unrealized gain on investments 0.18
-------
Total increase from investment operations $ 0.26
Distributions to shareholders:
From net investment income $ (0.08)
-------
In excess of net investment income (0.01)
Net increase in net asset value $ 0.17
-------
Net asset value, end of period $ 19.66
=======
Total return* 1.33%
Ratio of net expenses to average net assets 2.23%**+
Ratio of net investment income to average net assets 1.59%**+
Portfolio turnover rate 40.15%**
Average commission rate paid per exchange listed
transaction $ 0.0586
Net assets, end of period (in thousands) $ 1,466
Ratios assuming reduction for fees paid indirectly:
Net expenses 2.13%**
Net investment income 1.69%**
</TABLE>
+ Ratios assuming no reduction for fees paid indirectly.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all 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.
*** Class C shares were first publicly offered on January 31, 1996.
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
NOTES TO FINANCIAL STATEMENTS--April 30, 1996
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1. Pioneer Equity-Income Fund (the Fund), one of three funds that composes
Pioneer Growth Trust (the 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 current income and long- term growth of capital.
The Board of Trustees (the Trustees) has authorized the issuance of three
share classes of the Fund, designated as Class A, Class B and Class C shares.
Class C shares were first publicly offered on January 31, 1996. The shares of
Class A, Class B and Class C represent an interest in the same portfolio of
investments of the Fund 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 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 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 purposes. It is the Fund'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 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 $222,730 in underwriting commissions on the sale of
fund shares during the six months ended April 30, 1996. 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 same day and in the same
amount, except that Class A, Class B, and Class C shares bear different
transfer agent and distribution fees.
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
11
<PAGE>
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.
2. 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. Included in due to affiliates is $36,467 and $10,361 in
management fees and accounting fees, respectively, payable to PMC at April 30,
1996.
3. 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 $54,534 in transfer agent fees payable to PSC at April
30, 1996.
4. 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
$157,951 in distribution fees payable to PFD at April 30, 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 6 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
CDSC are paid to PFD. For the six months ended April 30, 1996, CDSC in the
amount of $54,326 was paid to PFD.
5. The Fund has entered into certain expense offset arrangements resulting in
a reduction in the Fund's total expenses. For the six months ended April 30,
1996, the Fund's expenses were reduced by $27,731 under such arrangements.
6. The Fund's investment in certain 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 April 30, 1996:
Purchases Sales Dividend
AFFILIATE Cost Cost Income Value
---------- ----- -------- ----------
The Gorman-Rupp Co. $5,902,512 $ -- $96,747 $8,209,216
12
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- ------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND THE BOARD OF TRUSTEES OF PIONEER EQUITY-INCOME FUND:
We have audited the accompanying balance sheet of Pioneer Equity-Income
Fund (one of three funds that composes Pioneer Growth Trust, a Massachusetts
business trust), including the schedule of investments, as of April 30, 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
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 April 30, 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 Equity-Income Fund as of April 30, 1996, and 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.
Boston, Massachusetts ARTHUR ANDERSEN LLP
May 31, 1996
13
