<PAGE><PAGE>
[logo] PIONEER
Pioneer Europe Fund
ANNUAL REPORT 10/31/99
<PAGE>
Table of Contents
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 7
Schedule of Investments 10
Financial Statements 16
Notes to Financial Statements 24
Report of Independent Public Accountants 30
Trustees, Officers and Service Providers 31
Retirement Plans From Pioneer 32
Programs and Services for Pioneer Shareowners 34
The Pioneer Family of Mutual Funds 36
</TABLE>
<PAGE>
Pioneer Europe Fund
LETTER FROM THE CHAIRMAN 10/31/99
Dear Shareowner,
- --------------------------------------------------------------------------------
As we approach the new millennium, it seems a suitable time to look back on how
the world of investing has changed since Pioneer was founded in 1928. The
creation of affordable investment options, including mutual funds, has brought
opportunity to millions of people worldwide and surely should be counted among
this century's greatest accomplishments. Just consider the impact a few notable
innovations - money market funds, employer-sponsored retirement vehicles and the
concept of international investing - have had on your life.
In some ways, investing has changed a great deal. One thing, however, remains
the same - our belief in the importance of a long-term perspective. Attempts at
market timing and the advent of day-trading unfortunately have led some to adopt
a "get rich quick" mentality. Looking back over time, lasting wealth has come to
investors who held to their discipline and didn't veer off course to chase the
rising star of the day. A solid, forward-thinking plan can offer great rewards,
even though it can be a tad dull moment to moment.
This year, we took extra steps to make your year-end planning easier, especially
tax planning. In November Pioneer funds distributed their capital gains - a
month earlier than in past years. We hope this early distribution helped you to
take advantage of the additional time to work with your investment professional
in preparing for the new century.
I encourage you to read on to learn more about your Fund, including the question
and answer session with portfolio manager Patrick Smith. You can visit our web
site at www.pioneerfunds.com to obtain information about our funds and to view
1999 distribution information.
Respectfully,
/s/ John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman and President
1
<PAGE>
Pioneer Europe Fund
PORTFOLIO SUMMARY 10/31/99
Portfolio Diversification
- --------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[pie chart]
International Common Stocks 92.8%
Short-Term Cash Equivalents 3.6%
Domestic Common Stocks 1.7%
International Preferred Stocks 1.6%
Depositary Receipts for International
Stocks 0.3%
Geographical Distribution
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[bar chart]
<TABLE>
<S> <C> <C> <C>
United Kingdom 27% Italy 6%
France 20% Sweden 5%
Germany 11% Finland 4%
Switzerland 8% Norway 2%
Netherlands 8% United States 2%
Spain 7%
</TABLE>
10 Largest Holdings
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
<TABLE>
<S> <C> <C>
1. Sidel SA (Bearer Shares) 3.94%
2. British Telecom Plc 2.91
3. Mannesmann AG 2.57
4. Nokia AB 2.42
5. Getronics NV 2.30
6. Telefonica SA 2.20
7. Julius Baer Holding AG 2.06
8. Vodafone AirTouch Plc 2.06
9. Shell Transport & Trading Co. 2.00
10. Hoechst AG 1.92
</TABLE>
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Europe Fund
PERFORMANCE UPDATE 10/31/99 CLASS A SHARES
Share Prices and Distributions
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Asset Value
per Share 10/31/99 10/31/98
<S> <C> <C>
$31.71 $29.87
</TABLE>
<TABLE>
<CAPTION>
Distributions per Share Income Short-Term Long-Term
(10/31/98 - 10/31/99) Dividends Capital Gains Capital Gains
<S> <C> <C> <C>
$0.094 - $0.731
</TABLE>
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer Europe Fund at public offering price, compared to the growth of the
Morgan Stanley Capital International (MSCI) Europe Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
<CAPTION>
Net Asset Public Offering
Period Value Price*
<S> <C> <C>
Life of Fund
(4/2/91) 13.84% 13.05%
5 Years 16.78 15.41
1 Year 9.01 2.75
</TABLE>
* 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+
<TABLE>
<CAPTION>
Pioneer Europe Fund* MSCI Europe Index
<S> <C> <C>
4/91 9425 10000
9524 10353
10320 11139
9194 10159
4/93 10265 11308
11353 12766
12423 13775
13159 14201
4/95 13568 15051
15148 16078
16448 17450
17845 18885
4/97 19974 21107
22894 23793
30209 30709
26215 29280
4/99 27649 32445
10/99 28577 32948
</TABLE>
+ Index comparison begins April 30, 1991. The Morgan Stanley Capital
International (MSCI) Europe Index is a capitalization-weighted index of the 15
European country indexes included in the MSCI EAFE (Europe, Australasia, Far
East) Index. These countries are: Austria, Belgium, Denmark, Finland, France,
Germany, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden,
Switzerland and the United Kingdom. Index returns are calculated monthly,
assume reinvestment of dividends and, unlike Fund returns, do not reflect any
fees, expenses or sales charges. You cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
3
<PAGE>
Pioneer Europe Fund
PERFORMANCE UPDATE 10/31/99 CLASS B SHARES
Share Prices and Distributions
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Asset Value
per Share 10/31/99 10/31/98
<S> <C> <C>
$30.38 $28.79
</TABLE>
<TABLE>
<CAPTION>
Distributions per Share Income Short-Term Long-Term
(10/31/98 - 10/31/99) Dividends Capital Gains Capital Gains
<S> <C> <C> <C>
- - $0.731
</TABLE>
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer Europe Fund, compared to the growth of the Morgan Stanley Capital
International (MSCI) Europe Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
<CAPTION>
If If
Period Held Redeemed*
<S> <C> <C>
Life of Fund
(4/4/94) 16.19% 16.10%
5 Years 15.88 15.77
1 Year 8.12 4.12
</TABLE>
* 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+
<TABLE>
<CAPTION>
Pioneer Europe Fund* MSCI Europe Index
<S> <C> <C>
4/94 10000 10000
10/94 10539 10309
10838 10926
10/95 12060 11672
13048 12668
10/96 14089 13709
15707 15323
10/97 17943 17272
23571 22293
10/98 20367 21256
21398 23554
10/99 21921 23919
</TABLE>
+ Index comparison begins April 30, 1994. The Morgan Stanley Capital
International (MSCI) Europe Index is a capitalization-weighted index of the 15
European country indexes included in the MSCI EAFE (Europe, Australasia, Far
East) Index. These countries are: Austria, Belgium, Denmark, Finland, France,
Germany, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden,
Switzerland and the United Kingdom. Index returns are calculated monthly,
assume reinvestment of dividends and, unlike Fund returns, do not reflect any
fees, expenses or sales charges. You cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
4
<PAGE>
Pioneer Europe Fund
PERFORMANCE UPDATE 10/31/99 CLASS C SHARES
Share Prices and Distributions
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Asset Value
per Share 10/31/99 10/31/98
<S> <C> <C>
$30.27 $28.67
</TABLE>
<TABLE>
<CAPTION>
Distributions per Share Income Short-Term Long-Term
(10/31/98 - 10/31/99) Dividends Capital Gains Capital Gains
<S> <C> <C> <C>
- - $0.731
</TABLE>
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer Europe Fund, compared to the growth of the Morgan Stanley Capital
International (MSCI) Europe Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
<CAPTION>
If If
Period Held Redeemed*
<S> <C> <C>
Life of Fund
(1/31/96) 16.73% 16.73%
1 Year 8.19 8.19
</TABLE>
* Assumes reinvestment of distributions. The 1% contingent deferred sales charge
(CDSC) applies to investments sold within one year of purchase.
[mountain chart]
Growth of $10,000+
<TABLE>
<CAPTION>
Pioneer Europe Fund* MSCI Europe Index
<S> <C> <C>
1/96 10000 10000
4/96 10542 10378
10678 10441
10/96 11391 11232
12505 12063
4/97 12705 12553
14226 14389
10/97 14520 14151
15559 15513
4/98 19095 18264
19567 19213
10/98 16509 17414
17850 19020
4/99 17343 19297
17036 18855
10/99 17862 19596
</TABLE>
The Morgan Stanley Capital International (MSCI) Europe Index is a
capitalization-weighted index of the 15 European country indexes included in
the MSCI EAFE (Europe, Australasia, Far East) Index. These countries are:
Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy,
Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United
Kingdom. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Fund returns, do not reflect any fees, expenses or sales
charges. You cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
5
<PAGE>
Pioneer Europe Fund
PERFORMANCE UPDATE 10/31/99 CLASS Y SHARES
Share Prices and Distributions
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Asset Value
per Share 10/31/99 10/31/98
<S> <C> <C>
$31.97 $29.90
</TABLE>
<TABLE>
<CAPTION>
Distributions per Share Income Short-Term Long-Term
(10/31/98 - 10/31/99) Dividends Capital Gains Capital Gains
<S> <C> <C> <C>
$0.037 - $0.731
</TABLE>
Investment Returns
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made in
Pioneer Europe Fund, compared to the growth of the Morgan Stanley Capital
International (MSCI) Europe Index.
Average Annual Total Returns*
(As of October 31, 1999)
<TABLE>
<CAPTION>
If If
Period Held Redeemed
<S> <C> <C>
Life of Fund
(7/2/98) -4.07% -4.07%
1 Year 9.59 9.59
</TABLE>
* Assumes reinvestment of distributions.
[mountain chart]
Growth of $10,000+
<TABLE>
<CAPTION>
Pioneer Europe Fund* MSCI Europe Index
<S> <C> <C>
7/98 10000 10000
8436 8742
7822 8392
10/98 8458 9064
8778 9546
9133 9963
1/99 9173 9899
8733 9648
8744 9753
4/99 8942 10044
8646 9562
8776 9723
7/99 8814 9814
8907 9914
8892 9837
10/99 9269 10199
</TABLE>
+ Index comparison begins July 31, 1998. The Morgan Stanley Capital
International (MSCI) Europe Index is a capitalization-weighted index of the 15
European country indexes included in the MSCI EAFE (Europe, Australasia, Far
East) Index. These countries are: Austria, Belgium, Denmark, Finland, France,
Germany, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden,
Switzerland and the United Kingdom. Index returns are calculated monthly,
assume reinvestment of dividends and, unlike Fund returns, do not reflect any
fees, expenses or sales charges. You cannot invest directly in the Index.
Past performance does not guarantee future results. Return and share price
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
6
<PAGE>
Pioneer Europe Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/99
Technology and competition are dramatically changing Europe's corporate
landscape. From telecommunications to finance, savvy new companies are emerging,
while established businesses are adapting or merging with competitors to extend
their market share. These trends are expected to have a profound impact on the
pace of economic and productivity growth, just as they did in the United States.
Your Fund benefited from investments in many high-growth companies during the 12
months ending October 31, 1999. In the following interview, portfolio manager
Patrick M. Smith highlights these companies and other factors that influenced
Fund performance.
Q: In recent months, demand for European stocks has been on the rise. What's
been the impact on stock prices?
A: The renewed interest has been very positive for stock prices. Feeling
considerably more upbeat about corporate prospects, Europeans are returning
to the region's stock markets in force. The euro, which is beginning to
stabilize, reflects an improving economic outlook and has helped to attract
investors.
For the 12 months ending October 31, 1999, Class A shares generated a U.S.
dollar-based total return of 9.01% at net asset value. (Class B and C shares
returned 8.12% and 8.19%, respectively.) The Morgan Stanley Capital
International (MSCI) Europe Index produced a return of 12.52%, while the
average European fund returned 10.72% as reported by Lipper Inc. (Lipper is
an independent firm that tracks mutual fund performance excluding sales
charges.) Undervalued, economically-sensitive cyclical stocks (machinery,
metals and mining) and energy stocks were among the best performers for the
period - sectors your Fund has traditionally deemphasized. Telecommunication
stocks, which represented one of the Fund's largest sectors, also were big
winners for the period.
Q: Why did the number of portfolio holdings decrease to 80 from 98?
A: We chose to focus even more selectively on what we consider to be
growth-at-a-reasonable-price stocks. We eliminated companies that were we
felt were unlikely to meet our growth expectations: Ashtead Group (U.K.) and
Industrie Natuzzi (Italy), for instance. We also took profits on the sale of
companies that we believed had maximized their growth potential, such as
Credit Commercial de
7
<PAGE>
Pioneer Europe Fund
PORTFOLIO MANAGEMENT DISCUSSION 10/31/99 (continued)
France. Other holdings fell prey to takeovers, such as France's Banque
Paribas. We reinvested the proceeds from these liquidations in existing
holdings that we believe have particularly promising prospects.
Q: The pace of mergers and acquisitions has been brisk. Did it benefit the
Fund?
A: Absolutely. The pace of merger and acquisition activity is the result of
deregulation and corporations' efforts to maintain global competitiveness.
Many of today's megadeals go beyond national borders, enabling European
companies to better position themselves in the new euro zone. Often, buying
start-ups or competitors is a quicker, cheaper way to gain market share. With
its purchase of AirTouch, Vodafone AirTouch (U.K.) became the world's largest
provider of wireless service. Vodafone is currently making a bid for
Mannesmann, Germany's largest mobile phone company. Mannesmann, the Fund's
third largest holding, recently purchased Orange (U.K.) to add to its
European network of Italian, Austrian and French cellular companies. The oil
industry is also seeing its share of mergers, albeit hostile at times, as
producers join forces to achieve greater economies of scale. French-based
Total Fina (France), recently purchased Elf Aquitaine (France), a Fund
holding.
Q: Did higher interest rates weaken financial stocks?
A: Yes. In the aftermath of the Federal Reserve's June increase in short-term
interest rates in the United States, investors feared that the European
Central Bank would follow suit. In the months leading up to the European
Central Bank's October decision to increase the short-term rate by half a
percentage point to 3.0%, investors sold stocks they perceived would be hurt
by the anticipated monetary tightening. Financial and insurance stocks were
hit hardest. Even so, our conviction remains unchanged that these stocks
stand to benefit from the longer-term trends of increased saving and
investing. In fact, the increased flow of investments into the European
markets has already boosted stock prices of asset managers Julius Baer
Holding (Switzerland) and Mediolanum (Italy).
8
<PAGE>
Pioneer Europe Fund
Q: What other types of companies did you find attractive?
A: Companies that allow Europe to participate in the rapid pace of technological
progress. Technology is creating a new world economy and is widely credited
with boosting growth and reducing inflation. High-tech companies are also
propelling the growth of many information-dependent industries, including
finance, media and retail.
The Internet, in particular, is highlighting new or more aggressive companies
that offer the necessary equipment and services to build infrastructure. With
their well-constructed, sleek phones telecommunications-equipment provider
Nokia (Finland) is providing cellular access to the Internet.
Software-industry giant SAP (Germany) is profiting from increased trade on
the world wide web and e-business.
The potential growth from information technology is significant. From 1990 to
1996, U.S. expenditures on information technology as a percentage of gross
national product grew to 3.25% from 2.25%. In contrast, Europe's expenditure
currently stands at 1.75%, unchanged from 1990. (Source: International Data
Corp.) Investments that the Fund makes to capitalize on this potential
include companies with the ability to transcend national and regional
boundaries. Computer consulting firms Merkantildata (Norway), Tietoenator
(Finland) and Getronics (Netherlands) help clients update computers and
software and are a valuable resource for corporations looking to outsource
projects.
Q: Where do you see Europe in the global economy as it enters the 21st century?
A: Europe is on an exciting path. National efforts to comply with mandates
established by the monetary union are creating a new breed of companies
focused on greater efficiencies, profitability and shareholder
accountability. The wave of cross-border mergers and acquisitions is also
shaping Europe's future. We feel confident that your Fund is invested in the
cutting-edge companies that will help transform Europe into a dynamic
economic bloc.
9
<PAGE>
Pioneer Europe Fund
SCHEDULE OF INVESTMENTS 10/31/99
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INVESTMENT IN SECURITIES - 96.4%
PREFERRED STOCK - 1.6%
16,000 SAP AG $ 7,068,431
-----------
Total Preferred Stock
(Cost $5,770,702) $ 7,068,431
-----------
COMMON STOCKS - 94.8%
Basic Materials - 2.5%
Chemicals - 0.6%
65,000 BASF AG $ 2,888,643
-----------
Chemicals (Diversified) - 1.9%
10,082 Celanese AG* $ 159,077
183,750 Hoechst AG 8,115,719
-----------
$ 8,274,796
-----------
Total Basic Materials $11,163,439
-----------
Capital Goods - 10.9%
Aerospace/Defense - 1.0%
746,600 British Aerospace Plc $ 4,416,525
-----------
Engineering & Construction - 0.9%
10,000 Suez Lyonnaise des Eaux $ 1,614,589
22,500 Technip 2,283,829
-----------
$ 3,898,418
-----------
Machinery (Diversified) - 4.9%
968,000 Invensys Plc $ 4,755,944
166,701 Sidel SA (Bearer Shares) 16,657,721
-----------
$21,413,665
-----------
Manufacturing (Diversified) - 2.5%
69,000 Mannesmann AG $10,879,389
-----------
Manufacturing (Specialized) - 0.6%
74,000 Tomra Systems ASA $ 2,828,566
-----------
Trucks & Parts - 1.0%
60,000 Valeo $ 4,310,481
-----------
Total Capital Goods $47,747,044
-----------
Communication Services - 11.1%
Cellular/Wireless Telecommunications - 4.4%
154,400 Libertel NV* $ 2,923,301
150,000 Sonera Group Plc 4,575,547
</TABLE>
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Cellular/Wireless Telecommunications (continued)
190,000 Telecom Italia Mobile SpA $ 1,187,118
570,000 Telecom Italia Mobile SpA Di Risp 1,978,530
1,870,000 Vodafone AirTouch Plc 8,711,337
-----------
$19,375,833
-----------
Telephone - 6.7%
676,904 British Telecom Plc $12,279,660
316,700 Global Telesystems Group, Inc.* 7,581,006
564,687 Telefonica SA* 9,289,628
-----------
$29,150,294
-----------
Total Communication Services $48,526,127
-----------
Consumer Cyclicals - 4.9%
Services (Commercial & Consumer) - 4.9%
5,000 Altran Technologies SA $ 1,713,989
420,000 Hays Plc 4,775,794
1,206 Kuoni Reisen Holding AG (Series B) (Registered) 5,142,688
116,700 TNT Post Group NV 2,970,571
91,454 Vivendi 6,930,913
-----------
Total Consumer Cyclicals $21,533,955
-----------
Consumer Staples - 9.5%
Broadcasting (Television/Radio/Cable) - 1.3%
75,200 United Pan-Europe Communications NV* $ 5,782,145
-----------
Entertainment - 1.3%
255,000 Pearson Plc $ 5,740,516
-----------
Foods - 2.6%
18,000 Groupe Danone $ 4,591,325
741,964 Unilever Plc 6,888,449
-----------
$11,479,774
-----------
Personal Care - 0.4%
218,000 Safilo $ 1,602,830
-----------
Restaurants - 1.0%
420,400 Compass Group Plc $ 4,490,206
-----------
Retail Stores (Food Chains) - 1.8%
42,000 Carrefour Supermarch SA $ 7,775,274
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 11
<PAGE>
Pioneer Europe Fund
SCHEDULE OF INVESTMENTS 10/31/99 (continued)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Services (Employment) - 1.1%
8,129 Adecco SA $ 4,916,530
-----------
Total Consumer Staples $41,787,275
-----------
Energy - 4.7%
Oil (International Integrated) - 1.9%
1,100,000 Shell Transport & Trading Co. $ 8,432,076
-----------
Oil & Gas (Refining & Marketing) - 2.8%
875,000 ENI SpA $ 5,117,250
51,148 Elf Aquitaine SA 6,913,302
-----------
$12,030,552
-----------
Total Energy $20,462,628
-----------
Financial - 22.5%
Banks (Major Regional) - 8.0%
895,000 Banca Fideuram SpA $ 5,413,082
135,000 Banca Popolare di Brescia 5,715,489
309,900 Banca Popolare di Milano 2,082,937
535,760 Banco Santander Central Hispano SA 5,562,131
37,520 Deutsche Pfandbriefbank AG 3,253,923
2,900 Julius Baer Holding AG 8,723,020
330,000 Svenska Handelbanken 4,574,416
-----------
$35,324,998
-----------
Banks (Money Center) - 3.9%
500,000 Lloyds TSB Group Plc $ 6,917,868
248,100 Royal Bank of Scotland Group 5,707,487
16,000 UBS AG 4,655,252
-----------
$17,280,607
-----------
Banks (Regional) - 0.7%
231,250 Halifax Plc $ 2,956,320
-----------
Financial (Diversified) - 2.1%
160,900 Fortis NV $ 5,539,312
17,300 Marschollek, Lautenschlaeger und Partner AG 3,648,499
-----------
$ 9,187,811
-----------
Insurance (Life/Health) - 2.2%
445,000 Mediolanum SpA $ 3,618,206
400,000 Prudential Corp. Plc 6,270,448
-----------
$ 9,888,654
-----------
</TABLE>
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Insurance (Multi-Line) - 2.9%
9,000 Allianz AG $ 2,727,342
38,000 Axa SA 5,360,017
8,000 Zurich Allied AG 4,529,292
-----------
$12,616,651
-----------
Insurance (Property/Casualty) - 1.1%
209,900 Skandia Forsakrings AB* $ 4,670,683
-----------
Investment Banking/Brokerage - 0.3%
22,700 Consors Discount Broker AG* $ 1,275,031
-----------
Investment Management - 1.3%
635,000 Amvescap Plc $ 5,634,530
-----------
Total Financial $98,835,285
-----------
Healthcare - 9.2%
Biotechnology - 1.7%
253,935 Celltech Chiroscience Plc* $ 1,898,559
103,000 Qiagen NV* 5,422,444
-----------
$ 7,321,003
-----------
Healthcare (Drugs/Major Pharmaceuticals) - 5.6%
250,000 Glaxo Wellcome Plc $ 7,377,964
3,200 Novartis AG 4,786,459
600 Roche Holdings AG 7,203,306
390,000 Smithkline Beecham Plc 5,030,654
-----------
$24,398,383
-----------
Healthcare (Medical Products/Supplies) - 1.9%
1,479,980 Biora AB+* $ 7,378,305
133,000 Biora AB (A.D.R.)+* 1,163,750
-----------
$ 8,542,055
-----------
Total Healthcare $40,261,441
-----------
Technology - 13.4%
Communications Equipment - 3.7%
20,400 Alcatel SA $ 3,186,474
91,000 Nokia AB 10,222,719
70,000 Telefonaktiebologet LM Ericsson 2,910,992
-----------
$16,320,185
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 13
<PAGE>
Pioneer Europe Fund
SCHEDULE OF INVESTMENTS 10/31/99 (continued)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Computers (Software & Services) - 3.9%
25,000 Cap Gemini SA $ 3,786,660
169,091 Dassault Systemes SA 7,012,955
35,000 GFI Informatique 3,129,253
90,000 Tietoenator Oyj (B Shares) 3,100,328
------------
$ 17,029,196
------------
Electronics (Component Distributors) - 1.8%
85,000 Siemens AG $ 7,648,789
------------
Electronics (Semiconductors) - 0.6%
29,000 STMicroelectronics NV $ 2,547,054
------------
Services (Computer Systems) - 2.2%
194,800 Getronics NV $ 9,712,277
------------
Services (Data Processing) - 1.2%
622,220 Merkantildata ASA $ 5,272,043
------------
Total Technology $ 58,529,544
------------
Transportation - 1.4%
Railways - 1.4%
2,167,740 Stagecoach Holdings Plc $ 6,162,309
------------
Total Transportation $ 6,162,309
------------
Utilities - 4.7%
Electric Companies - 4.0%
210,000 Endesa SA $ 4,203,508
750,000 Scottish Power Plc 6,938,408
425,000 Union Electrica Fenosa SA 6,218,274
------------
$ 17,360,190
------------
Water Utilities - 0.7%
192,150 Aguas De Barcelona $ 3,068,075
------------
Total Utilities $ 20,428,265
------------
Total Common Stocks
(Cost $359,773,564) $415,437,312
------------
WARRANTS - 0.0%
60,000 Banca Popolare di Bergamo, 3/31/04* $ 43,547
------------
Total Warrants
(Cost $0) $ 43,547
------------
TOTAL INVESTMENT IN SECURITIES
(Cost $365,544,266)(a) $422,549,290
------------
</TABLE>
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C> <C>
TEMPORARY CASH INVESTMENT - 3.6%
Commercial Paper - 3.6%
$15,840,000 Exxon Asset Management, Inc., 5.3%, 11/1/99 $ 15,840,000
------------
TOTAL TEMPORARY CASH INVESTMENT
(Cost $15,840,000) $ 15,840,000
------------
TOTAL INVESTMENT IN SECURITIES AND
TEMPORARY CASH INVESTMENT - 100%
(Cost $381,384,266)(a)(b) $438,389,290
============
</TABLE>
* Non-income producing security.
+ Investment held by Fund representing 5% or more of the outstanding voting
stock of such company.
(a) Distribution of investments by country of issue, as a percentage of total
equity holdings, is as follows:
<TABLE>
<S> <C>
United Kingdom 27.3%
France 19.6
Germany 11.3
Switzerland 8.3
Netherlands 7.7
Spain 6.7
Italy 6.3
Sweden 4.9
Finland 4.2
Norway 1.9
United States 1.8
-----
100.0%
=====
</TABLE>
(b) At October 31, 1999, the net unrealized gain on investments based on cost
for federal income tax purposes of $381,384,266 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $79,176,025
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (22,171,001)
-----------
Net unrealized gain $57,005,024
===========
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for the
year ended October 31, 1999, aggregated $285,984,949 and $377,933,567,
respectively.
The accompanying notes are an integral part of these financial statements. 15
<PAGE>
Pioneer Europe Fund
BALANCE SHEET 10/31/99
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (including temporary cash
investment of $15,840,000) (cost $381,384,266) $438,389,290
Receivables -
Investment securities sold 12,328,414
Fund shares sold 1,076,184
Dividends, interest and foreign taxes withheld 865,250
Forward foreign currency settlement hedge contracts - net 16,657
Other 36,441
------------
Total assets $452,712,236
------------
LIABILITIES:
Payables -
Investment securities purchased $ 684,450
Fund shares repurchased 2,017,738
Due to bank 1,496,578
Due to affiliates 701,046
Accrued expenses 219,367
------------
Total liabilities $ 5,119,179
------------
NET ASSETS:
Paid-in capital $374,868,261
Accumulated net investment loss (1,924)
Accumulated undistributed net realized gain on investments
and foreign currency transactions 15,705,702
Net unrealized gain on investments 57,005,024
Net unrealized gain on forward foreign currency contracts
and other assets and liabilities denominated in
foreign currencies 15,994
------------
Total net assets $447,593,057
============
NET ASSET VALUE PER SHARE:
Class A (based on $268,446,061/8,466,861 shares) $ 31.71
============
Class B (based on $129,335,689/4,257,893 shares) $ 30.38
============
Class C (based on $43,559,197/1,439,236 shares) $ 30.27
============
Class Y (based on $6,252,110/195,565 shares) $ 31.97
============
MAXIMUM OFFERING PRICE:
Class A $ 33.64
============
</TABLE>
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
STATEMENT OF OPERATIONS
For the Year Ended 10/31/99
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $882,616) $ 8,839,412
Interest 758,791
-----------
Total investment income $ 9,598,203
-----------
EXPENSES:
Management fees $ 4,638,696
Transfer agent fees
Class A 834,661
Class B 513,107
Class C 132,016
Class Y 454
Distribution fees
Class A 751,792
Class B 1,424,897
Class C 441,200
Administrative fees 74,561
Custodian fees 364,854
Registration fees 221,280
Professional fees 84,436
Printing 58,599
Fees and expenses of nonaffiliated trustees 30,782
Miscellaneous 31,914
-----------
Total expenses $ 9,603,249
Less fees paid directly (69,689)
-----------
Net expenses $ 9,533,560
-----------
Net investment income $ 64,643
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from:
Investments (including $97,388 realized loss from
affiliated companies) $16,371,097
Forward foreign curerncy contracts and other assets
and liabilities denominated in foreign currencies (66,770) $16,304,327
----------- -----------
Change in net unrealized gain from:
Investments $25,022,331
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (14,848) $25,007,483
----------- -----------
Net gain on investments and foreign currency
transactions $41,311,810
-----------
Net increase in net assets resulting from
operations $41,376,453
===========
</TABLE>
The accompanying notes are an integral part of these financial statements. 17
<PAGE>
Pioneer Europe Fund
STATEMENTS OF CHANGES IN NET ASSETS
For the Years Ended 10/31/99 and 10/31/98
<TABLE>
<CAPTION>
Year Ended Year Ended
10/31/99 10/31/98
<S> <C> <C>
FROM OPERATIONS:
Net investment income $ 64,643 $ 1,050,444
Net realized gain on investments
and foreign currency transactions 16,304,327 12,154,351
Change in net unrealized gain on investments
and foreign currency transactions 25,007,483 (16,481,673)
------------ ------------
Net increase (decrease) in net assets resulting
from operations $ 41,376,453 $ (3,276,878)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.09 and $0.00 per share, respectively) $ (1,013,262) $ -
Class Y ($0.04 and $0.00 per share, respectively) (9,758) -
Net realized gain:
Class A ($0.73 and $1.55 per share, respectively) (7,894,337) (8,775,752)
Class B ($0.73 and $1.55 per share, respectively) (3,614,535) (2,579,252)
Class C ($0.73 and $1.55 per share, respectively) (1,071,435) (378,222)
Class Y ($0.73 and $0.00 per share, respectively) (191,688) -
------------ ------------
Total distributions to shareholders $(13,795,015) $(11,733,226)
------------ ------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $710,992,780 $643,617,168
Reinvestment of distributions 10,819,404 10,774,515
Cost of shares repurchased (799,643,032) (342,543,555)
------------ ------------
Net increase (decrease) in net assets resulting
from fund share transactions $(77,830,848) $311,848,128
------------ ------------
Net increase (decrease) in net assets $(50,249,410) $296,838,024
NET ASSETS:
Beginning of year 497,842,467 201,004,443
------------ ------------
End of year (including accumulated net investment
income (loss) of $(1,924) and $1,023,223,
respectively) $447,593,057 $497,842,467
============ ============
</TABLE>
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
<TABLE>
<CAPTION>
CLASS A '99 Shares '99 Amount '98 Shares '98 Amount
<S> <C> <C> <C> <C>
Shares sold 16,523,710 $ 504,349,032 13,160,674 $ 422,013,822
Reinvestment of distributions 224,356 6,892,212 308,498 8,233,806
Less shares repurchased (18,838,071) (576,240,562) (8,428,265) (264,240,423)
----------- -------------- ---------- --------------
Net increase (decrease) (2,090,005) $ (64,999,318) 5,040,907 $ 166,007,205
=========== ============== ========== ==============
CLASS B
Shares sold 2,086,760 $ 61,633,662 4,459,295 $ 140,928,732
Reinvestment of distributions 102,586 3,040,634 87,112 2,257,941
Less shares repurchased (2,639,051) (77,154,350) (1,419,146) (42,296,605)
----------- -------------- ---------- --------------
Net increase (decrease) (449,705) $ (12,480,054) 3,127,261 $ 100,890,068
=========== ============== ========== ==============
CLASS C
Shares sold 4,935,240 $ 144,141,809 2,318,898 $ 72,082,438
Reinvestment of distributions 23,208 685,112 10,969 282,768
Less shares repurchased (4,888,732) (143,228,740) (1,194,746) (35,901,342)
----------- -------------- ---------- --------------
Net increase 69,716 $ 1,598,181 1,135,121 $ 36,463,864
=========== ============== ========== ==============
CLASS Y*
Shares sold 28,302 $ 868,277 262,130 $ 8,592,176
Reinvestment of distributions 6,534 201,446 - -
Less shares repurchased (98,056) (3,019,380) (3,345) (105,185)
----------- -------------- ---------- --------------
Net increase (decrease) (63,220) $ (1,949,657) 258,785 $ 8,486,991
=========== ============== ========== ==============
</TABLE>
* Class Y shares were first publicly offered on July 2, 1998.
The accompanying notes are an integral part of these financial statements. 19
<PAGE>
Pioneer Europe Fund
FINANCIAL HIGHLIGHTS 10/31/99
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended Year Ended Year Ended
10/31/99 10/31/98 10/31/97 10/31/96 10/31/95(a)
<S> <C> <C> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 29.87 $ 27.60 $ 23.25 $ 21.19 $ 19.91
-------- -------- -------- ------- -------
Increase from investment operations:
Net investment income $ 0.12 $ 0.10 $ 0.04 $ 0.11 $ 0.12
Net realized and unrealized gain on investments
and foreign currency transactions 2.54 3.72 6.11 3.38 2.57
-------- -------- -------- ------- -------
Net increase from investment operations $ 2.66 $ 3.82 $ 6.15 $ 3.49 $ 2.69
Distributions to shareholders:
Net investment income (0.09) - (0.22) - (0.01)
Net realized gain (0.73) (1.55) (1.58) (1.43) (1.40)
-------- -------- -------- ------- -------
Net increase in net asset value $ 1.84 $ 2.27 $ 4.35 $ 2.06 $ 1.28
-------- -------- -------- ------- -------
Net asset value, end of year $ 31.71 $ 29.87 $ 27.60 $ 23.25 $ 21.19
======== ======== ======== ======= =======
Total return* 9.01% 14.51% 28.30% 17.80% 15.12%
Ratio of net expenses to average net assets 1.63%+ 1.54%+ 1.78%+ 1.94%+ 1.76%+
Ratio of net investment income to average net assets 0.29%+ 0.47%+ 0.19%+ 0.57%+ 0.59%+
Portfolio turnover rate 60% 39% 32% 56% 62%
Net assets, end of year (in thousands) $268,446 $315,309 $152,267 $99,915 $78,505
Ratios assuming no waiver of management fees by
PIM and no reduction for fees
paid indirectly:
Net expenses 1.63% 1.54% 1.78% 2.00% 2.10%
Net investment income 0.29% 0.47% 0.19% 0.51% 0.25%
Ratios assuming waiver of management fees by
PIM and reduction for fees paid
indirectly:
Net expenses 1.62% 1.49% 1.77% 1.93% 1.75%
Net investment income 0.30% 0.52% 0.20% 0.58% 0.60%
</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.
+ Ratio assuming no reduction for fees paid indirectly.
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
FINANCIAL HIGHLIGHTS 10/31/99
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended Year Ended Year Ended
10/31/99 10/31/98(a) 10/31/97 10/31/96 10/31/95(a)
<S> <C> <C> <C> <C> <C>
CLASS B
Net asset value, beginning of year $ 28.79 $ 26.88 $ 22.74 $ 20.92 $19.80
-------- -------- ------- ------- ------
Increase (decrease) from investment operations:
Net investment loss $ (0.18) $ (0.09) $ (0.10) $ (0.04) $(0.02)
Net realized and unrealized gain on investments
and foreign currency transactions 2.50 3.55 5.93 3.29 2.56
-------- -------- ------- ------- ------
Net increase from investment operations $ 2.32 $ 3.46 $ 5.83 $ 3.25 $ 2.54
Distributions to shareholders:
Net investment income - - (0.11) - (0.02)
Net realized gain (0.73) (1.55) (1.58) (1.43) (1.40)
-------- -------- ------- ------- ------
Net increase in net asset value $ 1.59 $ 1.91 $ 4.14 $ 1.82 $ 1.12
-------- -------- ------- ------- ------
Net asset value, end of year $ 30.38 $ 28.79 $ 26.88 $ 22.74 $20.92
======== ======== ======= ======= ======
Total return* 8.12% 13.50% 27.35% 16.82% 14.43%
Ratio of net expenses to average net assets 2.48%+ 2.35%+ 2.57%+ 2.76%+ 2.49%+
Ratio of net investment loss to average net assets (0.52)%+ (0.34)%+ (0.55)%+ (0.23)%+ (0.13)%+
Portfolio turnover rate 60% 39% 32% 56% 62%
Net assets, end of year (in thousands) $129,336 $135,535 $42,472 $20,228 $8,826
Ratios assuming no waiver of management fees by
PIM and no reduction for fees
paid indirectly:
Net expenses 2.48% 2.35% 2.57% 2.80% 2.85%
Net investment loss (0.52)% (0.34)% (0.55)% (0.27)% (0.49)%
Ratios assuming waiver of management fees by
PIM and reduction for fees paid
indirectly:
Net expenses 2.47% 2.31% 2.55% 2.74% 2.46%
Net investment loss (0.51)% (0.30)% (0.53)% (0.21)% (0.10)%
</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.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 21
<PAGE>
Pioneer Europe Fund
FINANCIAL HIGHLIGHTS 10/31/99
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended 1/31/96 to
10/31/99 10/31/98(a) 10/31/97(a) 10/31/96
<S> <C> <C> <C> <C>
CLASS C
Net asset value, beginning of period $ 28.67 $ 26.73 $22.69 $19.92
------- ------- ------ ------
Increase (decrease) from investment operations:
Net investment loss $ (0.13) $ (0.04) $(0.12) $ -
Net realized and unrealized gain on investments
and foreign currency transactions 2.46 3.53 5.94 2.77
------- ------- ------ ------
Net increase from investment operations $ 2.33 $ 3.49 $ 5.82 $ 2.77
Distributions to shareholders:
Net investment income - - (0.20) -
Net realized gain (0.73) (1.55) (1.58) -
------- ------- ------ ------
Net increase in net asset value $ 1.60 $ 1.94 $ 4.04 $ 2.77
------- ------- ------ ------
Net asset value, end of period $ 30.27 $ 28.67 $26.73 $22.69
======= ======= ====== ======
Total return* 8.19% 13.70% 27.47% 13.91%
Ratio of net expenses to average net assets 2.42%+ 2.28%+ 2.49%+ 2.74%**+
Ratio of net investment loss to average net assets (0.44)%+ (0.20)%+ (0.52)%+ (0.00)%**+
Portfolio turnover rate 60% 39% 32% 56%
Net assets, end of period (in thousands) $43,559 $39,261 $6,266 $1,175
Ratios assuming no waiver of management fees by
PIM and no reduction for fees
paid indirectly:
Net expenses 2.42% 2.28% 2.49% 2.75%**
Net investment loss (0.44)% (0.20)% (0.52)% (0.01)%**
Ratios assuming waiver of management fees by
PIM and reduction for fees paid
indirectly:
Net expenses 2.40% 2.22% 2.46% 2.71%**
Net investment loss (0.42)% (0.14)% (0.49)% 0.03%**
</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.
22 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Europe Fund
FINANCIAL HIGHLIGHTS 10/31/99
<TABLE>
<CAPTION>
Year Ended 7/2/98 to
10/31/99 10/31/98
<S> <C> <C>
CLASS Y
Net asset value, beginning of period $29.90 $ 34.63
------ -------
Increase (decrease) from investment operations:
Net investment income $ 0.35 $ 0.07
Net realized and unrealized gain (loss) on investments 2.49 (4.80)
------ -------
Net increase (decrease) from investment operations $ 2.84 $ (4.73)
Distributions to shareholders:
Net investment income (0.04) -
Net realized gain (0.73) -
------ -------
Net increase (decrease) in net asset value $ 2.07 $ (4.73)
------ -------
Net asset value, end of period $31.97 $ 29.90
====== =======
Total return* 9.59% (13.66)%
Ratio of net expenses to average net assets 1.12%+ 1.12%**+
Ratio of net investment income to average net assets 0.90%+ 0.95%**+
Portfolio turnover rate 60% 39%
Net assets, end of period (in thousands) $6,252 $ 7,738
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.12% 1.11%**
Net investment income 0.90% 0.96%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of the
period, reinvestment of distributions and the complete redemption of the
investment at net asset value at the end of the period.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 23
<PAGE>
Pioneer Europe Fund
NOTES TO FINANCIAL STATEMENTS 10/31/99
1. Organization and Significant Accounting Policies
Pioneer Europe Fund (the Fund) 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 long-term
growth of capital.
The Fund offers four classes of shares - Class A, Class B, Class C, and Class Y
shares. Each class of shares represents an interest in the same portfolio of
investments of the Fund and has equal rights to voting, redemptions, dividends
and liquidation, except that the level of transfer agent and distribution fees
may differ among classes. Class A, Class B and Class C shareholders have
exclusive voting rights with respect to the distribution plan for each class.
There is no distribution plan for Class Y shares.
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. The net asset value is
computed once daily, on each day the New York Stock Exchange is open, as of
the close of regular trading on the Exchange. In computing the net asset
value, 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. Trading in foreign securities is substantially completed each
day at various times prior to the close of the New York Stock Exchange. The
values of such securities used in computing the net
24
<PAGE>
Pioneer Europe Fund
asset value of the Fund's shares are determined as of such times. Dividend
income is recorded on the ex-dividend date, except that certain dividends
from foreign securities where the ex-dividend date may have passed are
recorded as soon as the Fund is informed of the ex-dividend data in the
exercise of reasonable diligence. Interest income is recorded on the accrual
basis, net of unrecoverable foreign taxes withheld at the applicable country
rates. 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 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. Foreign Currency Translation
The books and records of the Fund are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between the
amount of income accrued and the U.S. dollar actually received. Further, the
effects of changes in foreign currency exchange rates on investments are not
segregated in the statement of operations from the effects of changes in
market price of those securities but are included with the net realized and
unrealized gain or loss on investments.
C. Forward Foreign Currency Contracts
The Fund enters into forward foreign currency contracts (contracts) for the
purchase or sale of a specific foreign currency at a fixed price on a future
date as a hedge or cross-hedge against either specific investment
transactions (settlement hedges) or portfolio positions (portfolio hedges).
All contracts are marked to market daily at the applicable exchange rates,
and any resulting unrealized gains or losses are recorded in the Fund's
financial statements. The Fund records realized gains and losses at the time
a portfolio hedge is offset by entry into a closing transaction or
extinguished by delivery of the currency. Risks may arise upon entering into
25
<PAGE>
Pioneer Europe Fund
NOTES TO FINANCIAL STATEMENTS 10/31/99 (continued)
these contracts from the potential inability of counterparties to meet the
terms of the contract and from unanticipated movements in the value of
foreign currencies relative to the U.S. dollar.
As of October 31, 1999, the Fund had no outstanding portfolio hedges. The
Fund's gross forward foreign currency settlement contracts receivable and
payable were $2,479,530 and $2,462,873, respectively, resulting in a net
receivable of $16,657 as of October 31, 1999.
D. 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.
At October 31, 1999 the Fund has reclassified $66,770 from accumulated
undistributed net investment income to accumulated undistributed net
realized gain on investments and foreign currency transactions. The
reclassification has no impact on the net asset value of the Fund and is
designed to present the Fund's capital accounts on a tax basis.
In order to comply with federal income tax regulations, the Fund has
designated $15,766,328 as a capital gain dividend for the purposes of the
dividend paid deduction.
E. 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 subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $155,920 in
underwriting commissions on the sale of fund shares during the year ended
October 31, 1999.
26
<PAGE>
Pioneer Europe Fund
F. 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. Class Y shares are not subject to a distribution plan.
Shareholders of each class share all expenses and fees paid to the transfer
agent, Pioneering Services Corporation (PSC), for their services, which are
allocated based on the number of accounts in each class and the ratable
allocation of related out-of-pocket expense (see Note 3).
Income, common expenses and realized and unrealized gains and losses are
calculated at the 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 with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, Class C, and Class Y shares can bear different
transfer agent and distribution fees.
2. Management Agreement
Pioneer Investment Management, Inc. (PIM), 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 1.00% of the Fund's average
daily net assets up to $300 million; 0.85% of the next $200 million; and 0.75%
of the excess over $500 million.
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, 1999, $366,316 was payable to PIM related to management
fees, administrative 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 $137,874 in transfer agent fees payable to PSC at October 31,
1999.
27
<PAGE>
Pioneer Europe Fund
NOTES TO FINANCIAL STATEMENTS 10/31/99 (continued)
4. Distribution Plans
The Fund adopted Plans of Distribution with respect to Class A, Class B and
Class C 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 the 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 $196,856
distribution fees payable to PFD at October 31, 1999.
In addition, redemptions of each class of shares (except Class Y shares) may be
subject to a contingent deferred sales charge (CDSC). A CDSC of 1.00% may be
imposed on redemptions of certain net asset value purchases of Class A shares
within one year of purchase. Class B shares that are redeemed within six years
of purchase are subject to a CDSC at declining rates beginning at 4.0%, based on
the lower of cost or market value of shares being redeemed. Redemptions of Class
C shares within one year of purchase are subject to a CDSC of 1.00%. Proceeds
from the CDSCs are paid to PFD. For the year ended October 31, 1999, CDSCs in
the amount of $777,494 were paid to PFD.
5. Expense Offsets
The Fund has entered into certain expense offset arrangements resulting in a
reduction in the Fund's total expenses. For the year ended October 31, 1999, the
Fund's expenses were reduced by $69,689 under such arrangements.
6. Line of Credit Facility
The Fund, along with certain other Funds in the Pioneer Family of Funds (the
Funds), collectively participate in a $50 million committed, unsecured revolving
line of credit facility. Borrowings are used solely for temporary or emergency
purposes. The Fund may borrow up to the lesser of $50 million or the limits set
by its prospectus for borrow-
28
<PAGE>
Pioneer Europe Fund
ings. Interest on collective borrowings of up to $25 million is payable at the
Federal Funds Rate plus 3/8% on an annualized basis, or at the Federal Funds
Rate plus 1/2% if the borrowing exceeds $25 million at any one time. The Funds
pay an annual commitment fee for this facility. The commitment fee is allocated
among such Funds based on their respective borrowing limits.
The average daily amount of borrowings outstanding during the year ended October
31, 1999 was $440,575. The average daily shares outstanding during the year were
16,428,070 resulting in an average borrowing per share of $0.03. The related
weighted average annualized interest rate for the year was 5.26%, and the total
interest expense on such borrowings was $23,485.
7. Affiliated Companies
The Fund's investments in certain companies 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, 1999:
<TABLE>
<CAPTION>
Dividend
Affiliates Purchases Sales Income Value
<S> <C> <C> <C> <C>
Biora AB $1,648,894 $54,251 $- $8,542,055
</TABLE>
29
<PAGE>
Pioneer Europe Fund
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareowners and the Board of Trustees
of Pioneer Europe Fund:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer Europe Fund as of October 31, 1999, 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
the 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, 1999 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 Europe Fund as of October 31, 1999, 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, 1999
30
<PAGE>
Pioneer Europe Fund
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
Trustees Officers
John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
Mary K. Bush President
Richard H. Egdahl, M.D. David D. Tripple, Executive Vice President
Margaret B.W. Graham Patrick M. Smith, Vice President
John W. Kendrick Eric W. Reckard, Treasurer
Marguerite A. Piret Joseph P. Barri, Secretary
David D. Tripple
Stephen K. West
John Winthrop
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Public Accountants
Arthur Andersen LLP
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneering Services Corporation
31
<PAGE>
RETIREMENT PLANS FROM PIONEER
Pioneer has a long history of helping people work toward their retirement goals,
offering plans suited to the individual investor and businesses of all sizes.
For more information on Pioneer retirement plans, contact your investment
professional, or call Pioneer at 1-800-622-0176.
Individual Plans
Individual Retirement Account (IRA)
An IRA is a tax-favored account that allows anyone under age 70-1/2 with earned
income to contribute up to $2,000 annually. Spouses may contribute up to $2,000
annually into a separate IRA, for a total of $4,000 per year for a married
couple. Earnings are tax-deferred, and contributions may be tax-deductible.
Roth IRA
The Roth IRA came about as part of the Taxpayer Relief Act of 1997 and is
available to investors in 1998. Contributions, up to $2,000 a year, are not
tax-deductible, but earnings are tax-free for qualified withdrawals.
401(k) Plan
The traditional 401(k) plan allows employees to make pre-tax contributions
through payroll deduction, up to $40,000 per year or 25% of pay, whichever is
less. Employers may contribute.
SIMPLE (Savings Incentive Match PLan for Employees) IRA Plan
Businesses with 100 or fewer eligible employees can establish a plan; it
resembles a traditional 401(k), but with less testing and lower administration
costs. Employees can make pre-tax contributions of up to $6,000 per year, and an
employer contribution is required.
32
<PAGE>
403(b) Plan
Also known as a Tax-Sheltered Account (TSA), a 403(b) plan is available only to
employees of public schools, not-for-profit hospitals and other tax-exempt
organizations. A 403(b) plan lets employees set aside a portion of their salary,
before taxes, through payroll deduction.
Simplified Employee Pension Plan (SEP)
SEPs let self-employed people and small-business owners make tax-deductible
contributions of up to 15% of their income. Generally, employers must contribute
the same percentage of pay for themselves and any eligible employees;
contributions are made directly to employees' IRAs. SEPs are easy to administer
and can be an especially good choice for firms with few or no employees.
Profit Sharing Plan
Profit sharing plans offer companies considerable flexibility, allowing them to
decide each year whether a contribution will be made and how much, up to 15% of
each participant's pay. These plans can include provisions for loans and vesting
schedules.
Age-Weighted Profit Sharing Plan
Like traditional profit sharing plans, employer contributions are flexible, but
age-weighted plans allocate contributions based on both age and salary.
Age-weighted plans are designed for employers who want to maximize their own
contributions while keeping contributions to employees affordable.
Money Purchase Pension Plan (MPP)
Money purchase plans are similar to profit-sharing plans, but allow for higher
annual contributions - up to 25% of pay. MPPs aren't as flexible as profit
sharing plans; a fixed percentage of pay must be contributed each year,
determined when the plan is established. Businesses often set up both MPPs and
profit sharing plans.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties.
33
<PAGE>
PROGRAMS AND SERVICES FOR PIONEER SHAREOWNERS
Your investment representative can give you additional information on Pioneer's
programs and services. If you want to order literature on any of the following
items directly, simply call Pioneer at 1-8O0-225-6292.
FactFone(SM)
Our automated account information service, available to you 24 hours a day,
seven days a week. FactFone(SM) 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.
34
<PAGE>
Automatic Exchange Program
A simple way to move money from one Pioneer fund to another over a period of
time. Just invest a lump sum in one fund, and select the other Pioneer funds you
wish to invest in. You choose the amounts and dates for Pioneer to sell shares
of your original fund and use the proceeds to buy shares of the other funds you
have chosen. Over time, your investment will be shifted out of the original
fund. (Automatic Exchange is available for originating accounts with a balance
of $5,000 or more.)
Directed Dividends
Lets you invest cash dividends from one Pioneer fund to an account in another
Pioneer fund with no sales charge or fee. Simply fill out the applicable
information on a Pioneer Account Options Form. (This program is available for
dividend payments only; capital gains distributions are not eligible at this
time.)
Direct Deposit
Lets you move money into your bank account using electronic funds transfer
(EFT). EFT moves your money faster than you would receive a check, eliminates
unnecessary paper and mail, and avoids lost checks. Simply fill out a Pioneer
Direct Deposit Form, giving your instructions.
Systematic Withdrawal Plan (SWP)
Lets you establish automatic withdrawals from your account at set intervals. You
decide the frequency and the day of the month you want. Pioneer will send the
proceeds by check to the address you designate, or electronically to your bank
account. You also can authorize Pioneer to make the redemptions payable to
someone else. (SWPs are available for accounts with a value of $10,000 or more.)
35
<PAGE>
THE PIONEER FAMILY OF MUTUAL FUNDS
For information about any Pioneer mutual fund, please contact your investment
professional, 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
United States
Pioneer Capital Growth Fund
Pioneer Growth Shares
Pioneer Micro-Cap Fund
Pioneer Mid-Cap Fund
Pioneer Small Company Fund
Pioneer Tax-Managed Fund
International/Global
Pioneer Emerging Markets Fund
Pioneer Europe Fund
Pioneer Indo-Asia Fund
Pioneer International Growth Fund
Pioneer World Equity Fund
Growth and Income Funds
Pioneer Fund
Pioneer II
Pioneer Balanced Fund
Pioneer Equity-Income Fund
Pioneer Real Estate Shares
Income Funds
Taxable
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer Limited Maturity Bond Fund
Pioneer Strategic Income Fund
Tax-Free
Pioneer Tax-Free Income Fund
Money Market Fund
Pioneer Cash Reserves Fund*
*An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks
to preserve the value of your investment at $1 per share, it is possible to
lose money by investing in the Fund.
36
<PAGE>
This page for your notes.
37
<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:
<TABLE>
<S> <C>
Account Information, including existing accounts,
new accounts, propectuses, 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
</TABLE>
This report must be preceded or accompanied by a current Fund prospectus.
<TABLE>
<S> <C> <C>
[logo]PIONEER Pioneer Investment Management, Inc. 7259-00-1299
60 State Street (C) Pioneer Funds Distributor, Inc.
Boston, Massachusetts 02109 (recycle symbol) Printed on Recycled Paper
www.pioneerfunds.com
</TABLE>
