[PIONEER LOGO]
Pioneer
Capital Growth
Fund
ANNUAL REPORT 10/31/97
<PAGE>
Table of Contents
- --------------------------------------------------------------------------------
Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 6
Schedule of Investments 10
Financial Statements 18
Notes to Financial Statements 24
Report of Independent Public Accountants 28
Trustees, Officers and Service Providers 29
<PAGE>
Pioneer Capital Growth Fund
LETTER FROM THE CHAIRMAN 10/31/97
Dear Shareowner,
- ---------------------------------------------------------------------------
I am pleased to introduce this report for Pioneer Capital Growth Fund, covering
its fiscal year ended October 31, 1997. On behalf of the Fund's investment
team, I thank you for your interest and this opportunity to comment briefly on
today's investing environment.
In the final week of October, the world's stock markets demonstrated
exceptional volatility. In the United States, the Dow Jones Industrial Average
took a break from its exhilarating upward climb to experience - in the space of
two days - both its biggest one-day point drop and its biggest one-day point
gain. Asian markets plunged after languishing for several months as they
digested currency and economic changes. European markets bounced around, shaken
by the drop in Asia and then heartened by the speedy U.S. rebound. Even Latin
American markets were affected, mostly in a chain reaction from nervous
investors.
This fast-paced change offers an important lesson in the value of discipline.
We had a powerful demonstration of how difficult, if not impossible, it is to
"time the market" - to buy only when prices are lowest and sell only when
prices are highest. We have always believed it is important to buy a stock for
the right reasons and at prices that make sense given a realistic outlook for
the company's prospects. We also believe in holding a stock until its price
rises to what we think is its full value, or we have reason to believe it won't
meet our expectations. While market swings are unnerving, they shouldn't deter
you from pursuing long-term strategies designed to meet long-term goals.
I encourage you to read on to learn more about your Fund, including the
Portfolio Management Discussion with Rod Wright, who assumed responsibility for
the Fund's day-to-day management in January after working on the portfolio for
several years. Please contact your investment representative, or us at
1-800-225-6292, if you have questions about Pioneer Capital Growth Fund.
Respectfully,
/s/ John F. Cogan, Jr.
John F. Cogan, Jr.,
Chairman and President
1
<PAGE>
Pioneer Capital Growth Fund
PORTFOLIO SUMMARY 10/31/97
P o r t f o l i o D i v e r s i f i c a t i o n
- ----------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[pie chart]
U.S. Common Stocks 92.3%
Short-Term Cash Equivalents 4.4%
Depositary Receipts for International Stocks 3.2%
International Common Stocks 0.1%
S e c t o r D i s t r i b u t i o n
- ----------------------------------------------------------------------------
(As a percentage of equity holdings)
[pie chart]
Technology 19%
Consumer Non-Durables 18%
Services 15%
Basic Industries 14%
Capital Goods 9%
Utilities 9%
Financial 8%
Energy 4%
Consumer Durables 3%
Transportation 1%
1 0 L a r g e s t H o l d i n g s
- ----------------------------------------------------------------------------
(As a percentage of equity holdings)
1. 20th Century Industries 2.28% 6. Atlantic Richfield Co. 1.79%
2. Western National Corp. 2.24 7. AT&T Corp. 1.70
3. Viacom, Inc. (Class B) 2.00 8. Wellman, Inc. 1.70
(Non-voting)
4. NCR Corp. 1.88 9. McDonald's Corp. 1.69
5. Telephone & Data 1.82 10. GTE Corp. 1.66
Systems Inc.
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/97 CLASS A SHARES
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- ----------------------------------------------------------------------------
Net Asset Value
per Share 10/31/97 10/31/96
$23.23 $19.85
Distributions per Share Income Short-Term Long-Term
(10/31/96 - 10/31/97) Dividends Capital Gains Capital Gains
$0.064 $0.377 $0.506
I n v e s t m e n t R e t u r n s
- ----------------------------------------------------------------------------
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.
[boxed text]
Average Annual Total Returns
(As of October 31, 1997)
Net Asset Public Offering
Period Value Price*
Life-of-Fund 17.81% 16.85%
(7/25/90)
5 Years 21.90 20.46
1 Year 22.67 15.62
* 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
Pioneer Capital Growth Fund* Standard & Poor's 500 Index
7/25/90 9425 10000
10/90 6732 8597
9470 10794
10/91 10395 11477
12315 12311
10/92 11526 12616
14341 13446
10/93 15743 14494
16752 14162
10/94 18738 15055
20575 16628
10/95 22348 19023
26375 21639
10/96 25292 23593
26832 27073
10/97 31026 31168
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
<PAGE>
Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/97 CLASS B SHARES
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- ----------------------------------------------------------------------------
Net Asset Value
per Share 10/31/97 10/31/96
$22.73 $19.53
Distributions per Share Income Short-Term Long-Term
(10/31/96 - 10/31/97) Dividends Capital Gains Capital Gains
-- $0.377 $0.506
I n v e s t m e n t R e t u r n s
- ----------------------------------------------------------------------------
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.
[boxed text]
Average Annual Total Returns
(As of October 31, 1997)
If If
Period Held Redeemed*
Life-of-Fund 18.98% 18.44%
(4/4/94)
1 Year 21.70 17.70
* 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 Growth Fund* Standard & Poor's 500 Index
4/4/94 10000 10000
4/94 10321 10273
10489 10521
10/94 11513 10921
11393 10956
4/95 13589 12062
13789 13259
10/95 13633 13800
14640 15181
4/96 16019 15697
14726 15443
10/96 15306 17115
16635 19176
4/97 16168 19639
18791 23490
10/97 18327 22610
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
<PAGE>
Pioneer Capital Growth Fund
PERFORMANCE UPDATE 10/31/97 CLASS C SHARES
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- ----------------------------------------------------------------------------
Net Asset Value
per Share 10/31/97 10/31/96
$22.69 $19.53
Distributions per Share Income Short-Term Long-Term
(10/31/96 - 10/31/97) Dividends Capital Gains Capital Gains
$0.041 $0.377 $0.506
I n v e s t m e n t R e t u r n s
- ----------------------------------------------------------------------------
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.
[boxed text]
Average Annual Total Returns
(As of October 31, 1997)
If If
Period Held Redeemed*
Life-of-Fund 14.75% 14.75%
(1/31/96)
1 Year 21.74 21.74
* Assumes reinvestment of distributions.
The 1% contingent deferred sales charge
(CDSC) applies to redemptions made
within one year of purchase.
[mountain chart]
Growth of $10,000
Pioneer Capital Growth Fund* Standard & Poor's 500 Index
1/96 10000 10000
10048 10069
10139 10203
4/96 10931 10340
11327 10577
10856 10660
7/96 10053 10172
10364 10364
10594 10987
10/96 10449 11274
10781 12101
10983 11902
1/97 11359 12632
11393 12706
11208 12223
4/97 11045 12937
11953 13695
12194 14352
7/97 12833 15473
13046 14585
13579 15426
10/97 12721 14894
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
<PAGE>
Pioneer Capital Growth Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/97
Dear Shareowner,
- ---------------------------------------------------------------------------
As stock markets worldwide demonstrated almost unprecedented volatility,
Pioneer Capital Growth Fund completed its seventh fiscal year on October 31,
1997. The major U.S. stock market indexes advanced for the year overall, but
most declined for the three-month period ended October 31.
For the year, your Fund's Class A Shares generated a 22.67% total return at net
asset value. The Fund's total return was strong on an absolute basis, although
it lagged the 27.28% average total return for the 799 funds in Lipper
Analytical Services' Growth Funds category. Throughout the year, investors
generally preferred larger "growth" stocks showing momentum, which, for the
most part, outperformed "value" stocks of all sizes, like those in your Fund.
A Strong Year for U.S. Stocks
When the fiscal year began, large U.S. stocks, especially those in the Dow
Jones Industrial Average, were leading the pack. Money went mostly to larger
stocks presumed to offer stability and predictable earnings growth. Investors
were still smarting from the summer of 1996, when smaller growth stocks,
particularly technology issues, led a sharp sell-off. The Dow rose
substantially in the last months of 1996, and larger stocks outperformed
smaller stocks into the early months of 1997.
The U.S. economy rose at nearly double the expected rate in the first calendar
quarter of 1997. The Federal Reserve raised short-term interest rates by
one-quarter of a percentage point on March 25, and the stock market declined
briefly. As April ended, the economy slowed, and investors looked toward
smaller and mid-size stocks, since a slowing economy can lead to slower
earnings growth for larger companies. Although their growth did slow somewhat,
big stocks performed well through most of the summer, along with small and
mid-size stocks.
6
<PAGE>
Pioneer Capital Growth Fund
Concerns about accelerating economic growth, inflation and the possibility of
another interest rate hike brought swings in stock prices until September, when
the Fed chose not to raise rates. In October, Japan's continuing banking crisis
and weak Far Eastern currencies brought more volatility to U.S. stock markets.
Things culminated on October 27 in a record-setting one-day point drop in the
Dow and substantial declines in other U.S. indexes and international markets.
The following day, bargain-hunting investors drove the Dow to its biggest
one-day point gain ever. Without a doubt, investors took a roller-coaster ride
over the past 12 months.
Portfolio Priorities: Cash and Consolidation
We are pleased with our success in reducing the Fund's hefty cash position. The
Fund began the fiscal year with slightly more than 23% of the portfolio in
short-term cash equivalents, thanks to investor inflows into the Fund and sales
of stocks that had reached price targets. By April 30, we had reduced
short-term cash equivalents to about 11%, and by October 31 to 4.4%. Some of
this cash went to increasing positions in stocks already in the portfolio, such
as supermarket operator Great Atlantic & Pacific Tea. We also bought more
shares of many of the Fund's largest positions.
Value Comes in Many Sizes
For your Fund, we use an "aggressive value" style to invest in companies of any
size whose stocks are trading at prices substantially below what we see as
their true worth. We look for companies ready for turnaround, ripe for takeover
or whose stock price has been extremely, and undeservedly, beaten down. We
evaluate company fundamentals, such as quality of products and management, cash
flow, earnings growth and market share. Our style means we often wait for other
investors to recognize the potential we already see. While we do, the already
low prices of these "value" stocks can also offer some price protection in a
market downturn.
7
<PAGE>
Pioneer Capital Growth Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/97 (continued)
Even though your Fund invests in a lot of small stocks, we like to keep an open
mind about company size. This year, price declines in some larger stocks during
market downturns presented buying opportunities. We added several large
companies to the portfolio, such as global fast-food giant McDonald's and
entertainment conglomerate Viacom. Adding stocks of sizable companies raised
the portfolio's median market capitalization from $429 million at the end of
January to $1.3 billion at the end of October. These larger stocks give the
portfolio more balance and increase the Fund's ability to participate when
different sizes of stocks rally. However, as of October 31, small and mid-size
companies represented about three-quarters of the stocks in the portfolio.
Patience as a Method
Patience in waiting for stocks to develop is an important part of our strategy.
Computer giant Unisys and retailer Fingerhut are examples of long-time holdings
that performed well in 1997. Unisys came into the portfolio at about $6 a
share. This year it rose to $14, and we sold a large part of the position.
Similarly, the Fund's average cost for Fingerhut was around $12, and we sold
shares around $22.
Portfolio mainstays retailer Tandy and telecommunications pioneer AT&T further
boosted Fund performance with exceptional price growth. Both improved
profitability by selling weak divisions. Tandy also teamed up with Sprint to
offer cellular phones in Radio Shack stores, creating a store within a store we
think offers tremendous profit potential.
There were some disappointments in the year. The stock price of healthcare
provider Pacificare suffered when the company's profitability declined
following a number of business acquisitions. Also notable was Levitz, the
mid-priced furniture retailer. Despite installing new management and making
significant changes to its business, it could not overcome the slow pace of
sales plaguing its portion of the furniture market. In September, the company
declared bankruptcy, and we sold the Fund's shares at a loss. However, the
stock's relatively small position in this diversified portfolio kept it from
greatly hindering Fund performance.
8
<PAGE>
Pioneer Capital Growth Fund
A Look Ahead
Your Fund's portfolio includes stocks of all sizes, likely to grow at different
points in the future. We are confident in the current mix of stocks, which
roughly falls into three growth timelines: those showing results now, those
poised to work over the course of the next year and those that expect to hit
their stride some time in the next two or three years. We will continue to
actively manage the portfolio, selecting stocks individually, counting on our
research to reveal reasonably priced companies with real growth potential. We
designed the portfolio to reward shareowners over the long-term, and we believe
it can produce competitive returns in both up and down markets.
Respectfully,
/s/ J. Rodman Wright
J. Rodman Wright,
Portfolio Manager
9
<PAGE>
Pioneer Capital Growth Fund
SCHEDULE OF INVESTMENTS 10/31/97
Shares Value
COMMON STOCKS - 95.6%
Basic Industries - 13.4%
Chemicals - 6.1%
2,100,000 Agrium Inc. $ 23,493,750
1,048,900 Borden Chemicals & Plastics, L.P. 9,505,657
1,168,700 The Geon Co.+ 25,346,181
652,000 Georgia Gulf Corp. 19,560,000
1,270,000 NL Industries, Inc.* 21,193,125
1,925,000 Wellman, Inc.+ 39,101,563
185,000 Witco Corp. 8,047,500
------------
$146,247,776
------------
Containers - 0.2%
325,000 Jefferson Smurfit Corp.* $ 4,875,000
------------
Forest Products - 1.6%
200,000 Consolidated Papers, Inc. $ 10,387,500
1,355,000 Louisiana-Pacific Corp. 28,455,000
------------
$ 38,842,500
------------
Iron & Steel - 1.2%
1,862,500 Armco, Inc.* $ 10,709,375
1,425,000 LTV Corp. 17,367,188
------------
$ 28,076,563
------------
Metals & Mining - 1.5%
350,000 Freeport-McMoRan Copper & Gold, Inc. $ 8,071,875
686,000 Newmont Mining Corp. 24,010,000
835,200 TVX Gold Inc.* 3,549,600
------------
$ 35,631,475
------------
Non-Ferrous Metals - 0.8%
860,000 Brush Wellman, Inc.+ $ 20,693,750
------------
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
Shares Value
Paper Products - 2.0%
1,053,675 Aracruz Cellulose S.A. (Sponsored A.D.R.) $ 15,805,125
770,000 Bowater, Inc. 32,195,625
------------
$ 48,000,750
------------
Total Basic Industries $322,367,814
------------
Capital Goods - 8.4%
Construction & Engineering - 2.5%
170,000 Building Material Holding Corp.* $ 2,125,000
1,637,500 Justin Industries+ 21,389,844
1,000,000 The Lamson & Sessions Co.*+ 6,562,500
2,551,800 Morrison Knudsen Corp.* 29,983,650
------------
$ 60,060,994
------------
Producer Goods - 3.5%
372,900 Figgie International, Inc.* $ 4,987,538
1,101,300 Hasbro, Inc. 31,937,700
925,000 ITT Industries 29,195,312
1,040,000 Park Ohio Industries, Inc.*+ 17,030,000
------------
$ 83,150,550
------------
Telecommunications - 2.4%
1,550,000 Frontier Corp. $ 33,518,750
25,000 Commscope, Inc.* 275,000
475,000 Sprint Corp. 24,700,000
------------
$ 58,493,750
------------
Total Capital Goods $201,705,294
------------
Consumer Durables - 3.2%
Motor Vehicles - 1.5%
750,000 Chrysler Corp. $ 26,437,500
357,700 PEP Boys-Manny, Moe & Jack 9,009,569
------------
$ 35,447,069
------------
The accompanying notes are an integral part of these financial statements. 11
<PAGE>
Pioneer Capital Growth Fund
SCHEDULE OF INVESTMENTS 10/31/97 (continued)
Shares Value
Misc. Consumer Durables- 1.7%
582,500 Maytag Corp. $ 19,440,938
900,000 Tupperware Corp. 22,556,250
------------
$ 41,997,188
------------
Total Consumer Durables $ 77,444,257
------------
Consumer Non-Durables - 17.3%
Agriculture & Food - 0.9%
1,200,000 Tyson Foods, Inc. $ 22,650,000
------------
Consumer Luxuries - 1.5%
1,129,700 Arctic Cat Inc.+ $ 13,273,975
870,000 U.S. Industries, Inc. 23,381,250
------------
$ 36,655,225
------------
Home Products - 0.6%
891,000 The Rival Co.+ $ 13,810,500
------------
Retail Food - 3.3%
492,900 Great Atlantic & Pacific Tea Co., Inc. $ 15,125,869
1,000,000 Richfood Holdings, Inc. 24,125,000
870,000 McDonald's Corp. 38,986,875
------------
$ 78,237,744
------------
Retail Non-Food - 8.3%
1,075,000 Charming Shoppes, Inc.* $ 5,576,562
380,000 Cole National Corp.* 16,102,500
1,155,300 Fingerhut Companies, Inc. 25,561,013
638,600 Jostens, Inc. 14,887,362
1,898,100 Kmart Corp.* 25,031,194
550,000 Office Depot, Inc.* 11,343,750
1,716,800 The Stride Rite Corp. 20,172,400
1,000,000 Tandy Corp. 34,375,000
70,000 Toro Co. 2,992,500
425,000 Toys "R" Us, Inc.* 14,476,563
1,600,000 Woolworth Corp.* 30,400,000
------------
$200,918,844
------------
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
Shares Value
Textiles/Clothes - 2.7%
625,000 Fruit of the Loom, Inc.* $ 16,289,062
520,000 Galey & Lord, Inc.* 9,555,000
772,500 Guilford Mills, Inc. 18,443,438
1,750,000 Tultex Corp.*+ 8,750,000
1,378,000 Worldtex, Inc.*+ 11,540,750
------------
$ 64,578,250
------------
Total Consumer Non-Durables $416,850,563
------------
Energy - 4.0%
Oil & Gas Extraction - 2.3%
228,750 Burlington Resources, Inc. $ 11,194,453
500,000 Oryx Energy Co.* 13,781,250
510,500 Seagull Energy Corp.* 12,475,344
400,000 Union Pacific Resources Group, Inc. 9,850,000
339,500 Union Texas Petro Holdings, Inc. 7,723,625
------------
$ 55,024,672
------------
Oil Refining & Drilling - 1.7%
500,000 Atlantic Richfield Co. $ 41,156,250
------------
Total Energy $ 96,180,922
------------
Financial - 7.7%
Insurance - 5.7%
531,855 Financial Security Assurance Holdings Ltd. $ 23,135,693
660,000 Gryphon Holdings, Inc.*+ 10,642,500
2,100,000 20th Century Industries 52,500,000
1,789,600 Western National Corp. 51,562,850
------------
$137,841,043
------------
Investment Bank/Brokerage - 0.8%
727,700 United Asset Management $ 19,284,050
------------
Life Insurance - 0.9%
550,000 Equitable Companies, Inc. $ 22,653,125
------------
The accompanying notes are an integral part of these financial statements. 13
<PAGE>
Pioneer Capital Growth Fund
SCHEDULE OF INVESTMENTS 10/31/97 (continued)
Shares Value
Real Estate - 0.3%
1,219,600 Bluegreen Corp.*+ $ 5,716,875
737,950 Triad Park LLC* 922,438
------------
$ 6,639,313
------------
Total Financial $186,417,531
------------
Services - 14.1%
Health & Personal Care - 5.0%
1,325,000 Columbia/HCA Healthcare Corp. $ 37,431,250
1,000,000 Dial Corp. 16,875,000
834,733 Integrated Health Services, Inc. 26,502,772
1,570,000 Mid Atlantic Medical Services, Inc.* 22,863,125
825,000 Sun Healthcare Group, Inc.* 16,396,875
------------
$120,069,022
------------
Hotel/Restaurant - 0.5%
1,051,000 Darden Restaurants, Inc. $ 11,955,125
------------
Pharmaceuticals - 4.2%
1,400,000 ImClone Systems, Inc.*+ $ 9,100,000
1,005,000 Ethical Holdings Plc (Sponsored A.D.R.)*+ 5,904,375
692,800 IVAX Corp.* 5,239,300
530,000 Magainin Pharmaceuticals, Inc.* 4,505,000
1,429,900 Medeva Plc (Sponsored A.D.R.) 19,750,493
410,000 Pacificare Health Systems, Inc. (Class B)
(Non-voting)* 26,547,500
425,000 Mallinckrodt, Inc. 15,937,500
425,000 Sepracor, Inc.* 15,246,875
------------
$102,231,043
------------
Publishing - 2.3%
1,230,300 John H. Harland Co. $ 27,604,856
708,800 K-III Communications Corp.* 8,860,000
800,000 Readers Digest Association, Inc. 18,200,000
------------
$ 54,664,856
------------
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
Shares Value
Misc. Services - 2.1%
680,000 ACNielsen Corp.* $ 15,555,000
500,000 Manpower, Inc. 19,187,500
644,500 Regis Corp. 15,468,000
------------
$ 50,210,500
------------
Total Services $339,130,546
------------
Technology - 18.6%
Business Machines - 1.4%
2,550,000 Unisys Corp.* $ 33,946,875
------------
Computer Services - 4.1%
260,000 BancTec, Inc.* $ 5,947,500
610,000 Broderbund Software, Inc.* 17,690,000
1,425,000 NCR Corp.* 43,195,313
1,000,000 Nextlevel Systems* 13,500,000
700,000 Seagate Technology* 18,987,500
------------
$ 99,320,313
------------
Electronics - 10.2%
290,000 Belden, Inc. $ 9,932,500
1,550,000 DSC Communications Corp.* 37,781,250
500,000 Harman International 27,000,000
1,531,300 Imation Corp.* 32,731,537
1,380,000 Intergraph Corp.* 14,835,000
400,000 Lam Research Corp.* 14,450,000
264,000 Mapics, Inc.* 3,003,000
487,200 Marcam Corp.*+ 5,024,250
682,000 Marshall Industries* 23,912,625
280,000 Micro Focus Group Plc (Sponsored A.D.R.)* 9,397,500
580,000 Rexel, Inc.* 12,977,500
520,000 Teradyne, Inc.* 19,467,500
1,125,000 Vishay Intertechnology, Inc.* 26,929,687
811,500 Whittaker Corp.*+ 8,571,469
------------
$246,013,818
------------
The accompanying notes are an integral part of these financial statements. 15
<PAGE>
Pioneer Capital Growth Fund
SCHEDULE OF INVESTMENTS 10/31/97 (continued)
Shares Value
Photo/Instrumentation - 2.9%
375,000 Eastman Kodak Co. $ 22,453,125
1,525,000 Viacom, Inc. (Class B) (Non-voting)* 46,131,250
--------------
$ 68,584,375
--------------
Total Technology $ 447,865,381
--------------
Transportation - 0.8%
Ships & Shipping - 0.8%
700,000 Avondale Industries, Inc.* $ 18,900,000
--------------
Total Transportation $ 18,900,000
--------------
Utilities - 8.1%
Electric Utilities - 1.2%
200,000 Boston Edison Co. $ 6,312,500
425,000 Dominion Resources, Inc. 15,804,688
241,300 DTE Energy Co. 7,419,975
--------------
$ 29,537,163
--------------
Telecommunications - 6.9%
1,043,300 Alcatel Alsthom (Sponsored A.D.R.) $ 25,365,231
800,000 AT&T Corp. 39,150,000
183,020 Bell Atlantic Corp. 14,618,722
758,600 Citizens Utilities Co.* 7,538,587
900,000 GTE Corp. 38,193,750
985,500 Telephone & Data Systems Inc. 41,883,750
--------------
$ 166,750,040
--------------
Total Utilities $ 196,287,203
--------------
TOTAL COMMON STOCKS
(Cost $1,984,725,614)(a) $2,303,149,511
--------------
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
Principal
Amount Value
TEMPORARY CASH INVESTMENTS - 4.4%
Commercial Paper - 4.4%
$ 7,000,000 Bell South Capital Funding Corp., 5.48%, 11/10/97 $ 6,990,410
15,129,000 Household Finance Corp., 5.68%, 11/3/97 15,129,000
14,470,000 Kellogg Co., 5.45%, 12/18/97 14,367,042
7,560,000 PACCAR Financial, 5.48%, 11/20/97 7,538,135
15,000,000 Procter & Gamble, 5.43%, 11/17/97 14,963,800
15,000,000 Southern California Education, 5.47%, 11/12/97 14,974,929
21,075,000 Trans America Financial, 5.47%, 11/17/97 21,023,764
10,000,000 Wal-Mart Inc., 5.50%, 11/12/97 9,983,194
--------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $104,970,274) $ 104,970,274
--------------
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $2,089,695,888) $2,408,119,785
--------------
* Non-income producing security.
+ Investment held by the Fund representing 5% or more of the outstanding
voting stock of such company.
(a) At October 31, 1997, the net unrealized gain on investments based on cost
for federal income tax purposes of $2,089,791,076 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $ 404,730,529
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (86,401,820)
-------------
Net unrealized gain $ 318,328,709
-------------
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for
the year ended October 31, 1997 aggregated $1,601,034,437 and $1,205,864,515,
respectively.
The accompanying notes are an integral part of these financial statements. 17
<PAGE>
Pioneer Capital Growth Fund
BALANCE SHEET 10/31/97
ASSETS:
Investment in securities, at value (including temporary cash
investments of $104,970,274) (cost $2,089,695,888) $2,408,119,785
Cash 654,629
Receivables -
Investment securities sold 9,348,160
Fund shares sold 5,819,548
Dividends and interest 1,706,042
Other 40,089
--------------
Total assets $2,425,688,253
--------------
LIABILITIES:
Payables -
Investment securities purchased $ 24,407,398
Fund shares repurchased 1,455,223
Due to affiliates 2,633,837
Accrued expenses 67,050
--------------
Total liabilities $ 28,563,508
--------------
NET ASSETS:
Paid-in capital $1,837,574,025
Accumulated undistributed net investment income 7,387,854
Accumulated undistributed net realized gain on investments 233,738,969
Net unrealized gain on investments 318,423,897
--------------
Total net assets $2,397,124,745
--------------
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Class A (based on $1,591,655,460/68,530,460 shares) $ 23.23
--------------
Class B (based on $745,258,149/32,788,073 shares) $ 22.73
--------------
Class C (based on $60,211,136/2,654,023 shares) $ 22.69
--------------
MAXIMUM OFFERING PRICE:
Class A $ 24.65
--------------
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
STATEMENT OF OPERATIONS
For the Year Ended 10/31/97
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Dividends (net of foreign taxes withheld of $57,091) $18,181,142
Interest 18,727,763
Other 46,821
-----------
Total investment income $ 36,955,726
------------
EXPENSES:
Management fees $11,315,631
Transfer agent fees
Class A 3,091,169
Class B 1,476,812
Class C 97,809
Distribution fees
Class A 3,822,188
Class B 6,839,473
Class C 462,934
Accounting 170,183
Custodian fees 149,659
Registration fees 358,010
Professional fees 65,084
Printing 121,822
Fees and expenses of nonaffiliated trustees 34,760
Miscellaneous 111,283
-----------
Total expenses $ 28,116,817
Less fees paid indirectly (428,457)
------------
Net expenses $ 27,688,360
------------
Net investment income $ 9,267,366
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments $235,661,875
Change in net unrealized gain on investments 203,007,226
------------
Net gain on investments $438,669,101
------------
Net increase in net assets resulting from operations $447,936,467
============
</TABLE>
The accompanying notes are an integral part of these financial statements. 19
<PAGE>
Pioneer Capital Growth Fund
STATEMENTS OF CHANGES IN NET ASSETS
For the Years Ended 10/31/97 and 10/31/96
<TABLE>
<CAPTION>
Year Ended Year Ended
FROM OPERATIONS: 10/31/97 10/31/96
<S> <C> <C>
Net investment income $ 9,267,366 $ 3,459,045
Net realized gain on investments 235,661,875 86,162,651
Change in net unrealized gain on investments 203,007,226 62,313,444
-------------- --------------
Net increase in net assets resulting from operations $ 447,936,467 $ 151,935,140
-------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.06 and $0.09 per share, respectively) $ (4,238,978) $ (4,039,214)
Class C ($0.04 and $0.00 per share, respectively) (64,617) --
In excess of net investment income:
Class B ($0.00 and $0.02 per share, respectively) -- (280,550)
Net realized gain:
Class A ($0.88 and $1.87 per share, respectively) (58,684,558) (85,512,393)
Class B ($0.88 and $1.87 per share, respectively) (27,212,132) (32,983,888)
Class C ($0.88 and $0.00 per share, respectively) (1,392,090) --
-------------- --------------
Total distributions to shareholders $ (91,592,375) $ (122,816,045)
-------------- --------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 765,729,787 $1,101,508,775
Reinvestment of distributions 79,547,895 108,843,907
Cost of shares repurchased (720,497,724) (480,558,247)
-------------- --------------
Net increase in net assets resulting from fund
share transactions $ 124,779,958 $ 729,794,435
-------------- --------------
Net increase in net assets $ 481,124,050 $ 758,913,530
NET ASSETS:
Beginning of year 1,916,000,695 1,157,087,165
-------------- --------------
End of year (including accumulated undistributed net
investment income of $7,387,854 and $2,424,083
respectively) $2,397,124,745 $1,916,000,695
============== ==============
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
CLASS A '97 Shares '97 Amount '96 Shares '96 Amount
Shares sold 25,780,570 $ 549,681,572 38,301,967 $ 758,958,566
Reinvestment of distributions 2,920,874 57,365,349 4,464,200 82,141,282
Less shares repurchased (25,642,389) (562,314,860) (20,836,196) (408,960,339)
----------- -------------- ----------- --------------
Net increase 3,059,055 $ 44,732,061 21,929,971 $ 432,139,509
=========== ============== ========== ==============
CLASS B
Shares sold 8,593,655 $ 181,607,305 16,096,669 $ 314,192,890
Reinvestment of distributions 1,116,304 21,600,490 1,465,566 26,702,625
Less shares repurchased (7,093,350) (149,421,822) (3,623,421) (70,773,709)
----------- -------------- ----------- --------------
Net increase 2,616,609 $ 53,785,973 13,938,814 $ 270,121,806
=========== ============== ========== ==============
CLASS C*
Shares sold 1,640,290 $ 34,440,910 1,434,585 $ 28,357,319
Reinvestment of distributions 30,143 582,056 -- --
Less shares repurchased (409,184) (8,761,042) (41,811) (824,199)
----------- -------------- ----------- --------------
Net increase 1,261,249 $ 26,261,924 1,392,774 $ 27,533,120
=========== ============== ========== ==============
</TABLE>
* Class C shares were first publicly offered on January 31, 1996.
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Capital Growth Fund
FINANCIAL HIGHLIGHTS 10/31/97
<TABLE>
<CAPTION>
Year Ended Year Ended
10/31/97 10/31/96
<S> <C> <C>
CLASS A
Net asset value, beginning of year $ 19.85 $ 19.42
---------- ----------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.15 $ 0.08
Net realized and unrealized gain on investments 4.17 2.31
---------- ----------
Net increase from investment operations $ 4.32 $ 2.39
Distributions to shareholders:
Net investment income (0.06) (0.09)
Net realized gain (0.88) (1.87)
---------- ----------
Net increase in net asset value $ 3.38 $ 0.43
---------- ----------
Net asset value, end of year $ 23.23 $ 19.85
---------- ----------
Total return* 22.67% 13.12%
Ratio of net expenses to average net assets 1.00%+ 1.02%+
Ratio of net investment income (loss) to average net assets 0.64%+ 0.43%+
Portfolio turnover rate 63% 37%
Average commission rate paid (1) $ 0.0552 $ 0.0518
Net assets, end of year (in thousands) $1,591,655 $1,299,611
Ratios assuming reduction for fees paid indirectly:
Net expenses 0.98% 1.00%
Net investment income 0.66% 0.45%
Year Ended Year Ended Year Ended
10/31/95 10/31/94 10/31/93
<S> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 17.26 $ 16.17 $ 12.42
--------- -------- --------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.08 $ (0.05) $ (0.02)
Net realized and unrealized gain on investments 3.03 2.80 4.43
--------- -------- --------
Net increase from investment operations $ 3.11 $ 2.75 $ 4.41
Distributions to shareholders:
Net investment income -- -- --
Net realized gain (0.95) (1.66) (0.66)
--------- -------- --------
Net increase in net asset value $ 2.16 $ 1.09 $ 3.75
--------- -------- --------
Net asset value, end of year $ 19.42 $ 17.26 $ 16.17
--------- -------- --------
Total return* 19.32% 19.03% 36.59%
Ratio of net expenses to average net assets 1.16%+ 1.26% 1.27%
Ratio of net investment income (loss) to average net assets 0.53%+ (0.44)% (0.26)%
Portfolio turnover rate 59% 47% 68%
Average commission rate paid (1) -- -- --
Net assets, end of year (in thousands) $845,415 $405,904 $194,670
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.14% -- --
Net investment income 0.55% -- --
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio assuming no reduction for fees paid indirectly.
(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>
FINANCIAL HIGHLIGHTS 10/31/97
Pioneer Capital Growth Fund
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended 4/4/94 to
10/31/97 10/31/96 10/31/95 10/31/95
<S> <C> <C> <C> <C>
CLASS B
Net asset value, beginning of period $ 19.53 $ 19.20 $ 17.20 $ 14.94
-------- -------- -------- -------
Increase (decrease) from investment operations:
Net investment loss $ (0.02) $ (0.04) $ (0.01) $ (0.04)
Net realized and unrealized gain on investments 4.10 2.26 2.96 2.30
-------- -------- -------- -------
Net increase from investment operations $ 4.08 $ 2.22 $ 2.95 $ 2.26
Distributions to shareholders:
In excess of net investment income -- (0.02) -- --
Net realized gain ( 0.88) (1.87) ( 0.95) --
-------- -------- -------- -------
Net increase in net asset value $ 3.20 $ 0.33 $ 2.00 $ 2.26
-------- -------- -------- -------
Net asset value, end of period $ 22.73 $ 19.53 $ 19.20 $ 17.20
-------- -------- -------- -------
Total return* 21.70% 12.27% 18.42% 15.13%
Ratio of net expenses to average net assets 1.76%+ 1.79%+ 1.93%+ 2.04%**
Ratio of net investment loss to average net assets ( 0.12)%+ (0.35)%+ (0.18)%+ (1.12)%**
Portfolio turnover rate 63% 37% 59% 47%
Average commission rate paid(1) $ 0.0552 $ 0.0518 -- --
Net assets, end of period (in thousands) $745,258 $589,188 $311,672 $42,459
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.75% 1.78% 1.88% --
Net investment loss (0.11)% (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 sales 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.
22
<PAGE>
Pioneer Capital Growth Fund
FINANCIAL HIGHLIGHTS 10/31/97
<TABLE>
<CAPTION>
Year Ended 1/31/96 to
10/31/97(a) 10/31/96
<S> <C> <C>
CLASS C
Net asset value, beginning of period $ 19.53 $ 18.69
--------- --------
Increase (decrease) from investment operations:
Net investment loss $ (0.03) $ (0.02)
Net realized and unrealized gain on investments 4.11 0.86
--------- ---------
Net increase from investment operations $ 4.08 $ 0.84
Distributions to shareholders:
Net investment income (0.04) --
Net realized gain (0.88) --
--------- ---------
Net increase in net asset value $ 3.16 $ 0.84
--------- ---------
Net asset value, end of period $ 22.69 $ 19.53
--------- ---------
Total return* 21.74% 4.50%
Ratio of net expenses to average net assets 1.75%+ 1.79%**+
Ratio of net investment loss to average net assets (0.15)%+ (0.39)%**+
Portfolio turnover rate 63% 37%
Average commission rate paid(1) $0.0552 $0.0518
Net assets, end of period (in thousands) $60,211 $27,202
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.73% 1.74%**
Net investment loss (0.13)% (0.34)%**
</TABLE>
(a)The per share data presented above is based upon the average shares
outstanding for the period presented.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
(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. 23
<PAGE>
Pioneer Capital Growth Fund
NOTES TO FINANCIAL STATEMENTS 10/31/97
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.
The Fund offers three classes of shares - Class A, Class B, and Class C shares.
Shares of Class A, Class B, and Class C each represent an interest in the same
portfolio of investments of the 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 Board of Trustees. Dividend
income is recorded on the ex-dividend date and interest income is recorded
on the accrual basis. Temporary cash investments are valued at amortized
cost.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes. It
is the Fund's practice first to select for sale those securities
24
<PAGE>
Pioneer Capital Growth Fund
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 paid-in
capital, depending on the type of book/tax differences that may exist.
In order to comply with federal income tax regulations, the Fund has
designated $169,788,656 as a capital gain dividend for the purposes of the
dividend paid deduction.
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
$1,276,314 in underwriting commissions on the sale of fund shares during the
year ended October 31, 1997.
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
25
<PAGE>
Pioneer Capital Growth Fund
NOTES TO FINANCIAL STATEMENTS 10/31/97 (continued)
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.
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 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, 1997, $1,080,709 was 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 $476,684 in transfer agent fees payable to PSC at October 31,
1997.
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 $1,076,444 in distribution
fees payable to PFD at October 31, 1997.
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
26
<PAGE>
Pioneer Capital Growth Fund
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, 1997, CDSCs in the amount of $2,079,178 were 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, 1997, the Fund's expenses were reduced by $428,457 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, 1997:
<TABLE>
<CAPTION>
Dividend
Affiliates Purchases Sales Income Value
===================================================================================
<S> <C> <C> <C> <C>
Arctic Cat Inc. $ 5,725,637 $ -- $ 220,326 $ 13,273,975
Bluegreen Corp. -- 2,003,702 -- 5,716,875
Brush Wellman, Inc. 2,000,381 82,205 367,408 20,693,750
Ethical Holdings Plc
(Sponsored A.D.R.) 854,375 -- -- 5,904,375
The Geon Co. 15,146,034 -- 493,550 25,346,181
Gryphon Holdings, Inc. -- -- -- 10,642,500
ImClone Systems, Inc. -- 104,997 -- 9,100,000
Justin Industries -- 5,155,334 319,771 21,389,844
The Lamson &
Sessions Co. -- 1,720,255 -- 6,562,500
Marcam Corp. -- 710,820 -- 5,024,250
Park Ohio Industries, Inc. -- 681,852 -- 17,030,000
The Rival Co. 6,628,251 961,222 157,620 13,810,500
Tultex Corp. 384,013 -- -- 8,750,000
Wellman, Inc. 10,299,596 3,008,494 654,626 39,101,563
Whittaker Corp. -- 2,771,020 -- 8,571,469
Worldtex, Inc. -- 532,307 -- 11,540,750
----------- ----------- ---------- ------------
$41,038,287 $17,732,208 $2,213,301 $222,458,532
=========== =========== ========== ============
</TABLE>
27
<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, 1997, 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, 1997 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, 1997,
the results of its operations, the changes in its net assets, and the financial
highlights for the periods presented, in conformity with generally accepted
accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
December 3, 1997
28
<PAGE>
Pioneer Capital Growth Fund
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
Trustees Officers
John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
President
Mary K. Bush David D. Tripple, Executive Vice President
Richard H. Egdahl, M.D. J. Rodman Wright, Vice President
Margaret B.W. Graham William H. Keough, Treasurer
John W. Kendrick Joseph P. Barri, Secretary
Marguerite A. Piret
David D. Tripple
Stephen K. West
John Winthrop
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 LLP
Shareowner Services and Transfer Agent
Pioneering Services Corporation
29
<PAGE>
HOW TO CONTACT PIONEER
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
Pioneering Services Corporation
60 State Street
Boston, Massachusetts 02109
Our toll-free fax 1-800-225-4240
Our Internet e-mail address [email protected]
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
This report must be preceded or accompanied by a current
Fund prospectus.
[Pioneer logo]
Pioneer Funds Distributor, Inc.
60 State Street
Boston, Massachusetts 02109
www.pioneerfunds.com
1297 - 4645
[Copyright symbol] Pioneer Funds Distributor, Inc.
[Recycle symbol] Printed on Recycled Paper
