<PAGE>
[PIONEER LOGO]
Pioneer
Equity-Income
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 17
Notes to Financial Statements 25
Report of Independent Public Accountants 30
Trustees, Officers and Service Providers 31
Programs and Services for Pioneer Shareowners 32
Retirement Plans from Pioneer 34
The Pioneer Family of Mutual Funds 36
</TABLE>
<PAGE>
Pioneer Equity-Income Fund
- ---------------------------------
LETTER FROM THE CHAIRMAN 10/31/99
- ---------------------------------
Dear Shareowner,
- --------------------------------------------------------------------------------
As we move forward into 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 positive
returns, 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 John Carey. 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 Equity-Income Fund
- --------------------------------------------------------------------------------
PORTFOLIO SUMMARY 10/31/99
- --------------------------------------------------------------------------------
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)
[PLOT POINTS FOR PIE CHART]
U.S. Common Stocks 97%
U.S. Convertible
Securities 2%
Short-Term Cash
Equivalents 1%
[END PLOT POINTS]
S e c t o r D i s t r i b u t i o n
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[PLOT POINTS FOR PIE CHART]
Financial 17%
Communication Services 15%
Utilities 13%
Healthcare 10%
Consumer Cyclicals 9%
Consumer Staples 9%
Energy 7%
Technology 6%
Basic Materials 6%
Other 8%
[END PLOT POINTS]
1 0 L a r g e s t H o l d i n g s
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
<TABLE>
<S> <C> <C> <C>
1. SBC Communications, Inc. 6.45% 6. BestFoods 2.46%
2. Schering-Plough Corp. 3.98 7. Atlantic Richfield Co. 2.20
3. Chevron Corp. 2.66 8. GTE Corp. 2.06
4. U.S. West Communications 2.57 9. Helix Technology Corp. 1.96
Group, Inc.
5. Ford Motor Co. 2.49 10. Constellation Energy Group 1.91
</TABLE>
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Equity-Income Fund
- -------------------------------------------------------------------
PERFORMANCE UPDATE 10/31/99 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
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 10/31/99 10/31/98
$ 29.97 $ 28.10
Income Short-Term Long-Term
Distributions per Share
(10/31/98-10/31/99) Dividends Capital Gains Capital Gains
$0.467 - $0.755
</TABLE>
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 Equity-Income Fund at public offering price, compared to the growth
of the Standard & Poor's 500 Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
<CAPTION>
Public
Net Asset Offering
Period Value Price*
<S> <C> <C>
Life-of-Fund 15.87% 15.13%
(7/25/90)
5 Years 18.91 17.51
1 Year 11.26 4.88
</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.
[PLOT POINTS FOR MOUNTAIN CHARTS]
<TABLE>
Pioneer Standard
Equity- &Poor's
Income 500
Fund* Index
<S> <C> <C>
7/25/90 9425 10000
8160 9426
10/91 11025 12286
12848 13221
10/93 15509 14547
15523 14745
10/95 18552 20266
21432 24907
10/97 27947 33205
33171 42675
10/99 36905 47774
</TABLE>
[END PLOT POINTS]
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 Equity-Income Fund
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PERFORMANCE UPDATE 10/31/99 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
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 10/31/99 10/31/98
$29.78 $27.91
Income Short-Term Long-Term
Distributions per Share
(10/31/98- 10/31/99) Dividends Capital Gains Capital Gains
$0.232 - $0.755
</TABLE>
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 Equity-Income Fund, compared to the growth of the Standard & Poor's
500 Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
<CAPTION>
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 17.22% 17.13%
(4/4/94)
5 Years 18.03 17.93
1 Year 10.43 6.43
</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.
[PLOT POINTS FOR MOUNTAIN CHART]
<TABLE>
Pioneer Standard
Equity- &Poor's
Income 500
Fund* Index
<S> <C> <C>
4/94 10000 10000
10343 10273
10593 10922
4/95 11036 12065
12568 13802
4/96 13854 15698
14416 17116
4/97 15853 19641
18646 22613
22009 27694
21971 27585
4/99 24529 33732
10/99 24163 34653
</TABLE>
[END PLOT POINTS]
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 Equity-Income Fund
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PERFORMANCE UPDATE 10/31/99 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
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 10/31/99 10/31/98
$29.75 $27.88
Income Short-Term Long-Term
Distributions per Share
(10/31/98- 10/31/99) Dividends Capital Gains Capital Gains
$0.208 - $0.755
</TABLE>
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 Equity-Income Fund, compared to the growth of the Standard & Poor's
500 Index.
Average Annual Total Returns
(As of October 31, 1999)
<TABLE>
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 16.46% 16.46%
(1/31/96)
1 Year 10.35 10.35
</TABLE>
* Assumes reinvestment of distributions.
The 1% contingent deferred sales charge
(CDSC) applies to investments sold
within one year of purchase.
[PLOT POINTS FOR MOUNTAIN CHART]
<TABLE>
Pioneer Standard
Equity- &Poor's
Income 500
Fund* Index
<S> <C> <C>
1/96 10000 10000
4/96 10133 10340
9745 10173
10/96 10534 11274
11405 12631
4/97 11580 12937
13563 15473
10/97 13622 14894
14795 16030
4/98 16075 18241
15828 18456
10/98 16047 18169
16858 21230
4/99 17908 22218
17879 22177
10/99 17708 22825
</TABLE>
[END PLOT POINTS]
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 Equity-Income Fund
- -------------------------------------------------------------------
PERFORMANCE UPDATE 10/31/99 CLASS Y 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
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 10/31/99 10/31/98
$ 30.00 $ 28.13
Income Short-Term Long-Term
Distributions per Share
(10/31/98- 10/31/99) Dividends Capital Gains Capital Gains
$ 0.578 - $ 0.755
</TABLE>
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 Equity-Income Fund, compared to the growth of the Standard & Poor's
500 Index.
Average Annual Total Returns*
(As of October 31, 1999)
<TABLE>
<CAPTION>
If If
Period Held Redeemed
<S> <C> <C>
Life-of-Fund 7.36% 7.36%
(7/2/98)
1 Year 11.67 11.67
</TABLE>
* Assumes reinvestment of distributions.
[PLOT POINTS FOR MOUNTAIN CHART]
<TABLE>
Pioneer Standard
Equity- &Poor's
Income 500
Fund* Index
<S> <C> <C>
7/98 10000 10000
9680 9788
8663 8361
9229 8919
10/98 9841 9635
10201 10205
10564 10815
1/99 10366 11259
10156 10895
10091 11352
4/99 11045 11783
10955 11488
11315 12150
7/99 11060 11761
10849 11687
10481 11392
10/99 10990 12105
</TABLE>
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.
6
<PAGE>
Pioneer Equity-Income Fund
- ----------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 10/31/99
- ----------------------------------------
Pioneer Equity-Income Fund's fiscal year ended on October 31, 1999. In the
following interview, portfolio manager John Carey discusses the market
environment and the Fund's strategies.
Q: Over the past year market conditions have changed quite a bit. What has
taken place and how has the Fund performed in this environment?
A: This past year we saw an intensification of investor interest in large
growth stocks, especially in the technology industry. Above all, the
internet and stocks related to it fascinated investors, and some internet
share prices recorded truly astronomical gains. At the same time, many other
stocks had a more difficult time attracting investors, and unfortunately
that included many of the conservative, dividend-paying stocks in the Fund's
portfolio.
In fact, this past year was one of the more frustrating periods for our
style of investing. For the one year period, the Fund's Class A shares
returned 11.26% at net asset value versus a return of 25.63% for the
Standard & Poor's 500 Index. Relative to other mutual funds with similar
objectives, the story is more favorable. The Fund's gain exceeded the 9.56%
average return for funds in the Lipper, Inc. equity-income universe. (Lipper
is an independent firm that tracks mutual fund performance.)
Q: The Fund's largest concentration is in the financial sector. How have rising
interest rates affected these companies?
A: Higher interest rates generally create difficulties for companies in the
financial sector as well as for cyclical companies and utilities. The Fund
invests in all three groups because stocks of these companies traditionally
provide above-average dividend yields. To moderate risk to the Fund from a
rise in interest rates, we have made an effort to identify companies with
the potential to increase their dividend payments.
We also devote much attention to the analysis of companies' balance sheets
and aim to avoid those that might become overburdened by the higher cost of
borrowing. Of course, the stock market may not make such fine distinctions
between companies when rates first go up. In due course, however, we believe
stronger companies will be sorted out from
7
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 10/31/99 (continued)
- --------------------------------------------------------------------------------
weaker ones, and a temporary price decline will often appear to have been an
opportunity to buy good-quality stocks at reasonable prices.
Q: What market sectors do you find particularly attractive now?
A: Transportation, consumer staples, and basic materials. All have been out of
favor with Wall Street, yet we think all include a number of companies with
major opportunities for improved earnings over the next few years. Our
practice is to look for what other investors appear to have overlooked.
Important holdings for us in these sectors include Burlington Northern Santa
Fe, Norfolk Southern, and Union Pacific (convertible preferred shares) in
transportation; Best Foods, Campbell Soup, General Mills, and H. J. Heinz in
consumer staples; and Alcoa, E.I. du Pont de Nemours, Consolidated Papers,
Roanoke Electric Steel, and Phelps Dodge in basic materials. All have been
strong dividend payers. All provide goods and services that are always in
demand. And all, in our view, have potential for better future results than
what is reflected in their share prices.
Q: What sectors do you avoid?
A: With our mildly contrarian bent, we tend to stay away from the most popular
and highest priced sectors. Especially today, with the extremely high prices
for stocks, particularly of many technology companies, we are quite cautious
in appraising investments in that sector. Your Fund does hold some
technology positions, including Hewlett-Packard, Helix Technology
(manufacturer of equipment used in making semiconductors), and Eastman
Kodak, but the overall weighting of the technology sector in the Fund is far
below that of the stock market as measured by the S&P 500 Index. All of the
technology companies in the Fund currently pay dividends.
We also have reservations about the corporate behemoths that have "bulked
up" their businesses by making large acquisitions. In some cases that
strategy will probably bear fruit, and we are hopeful that will be true in
the telecommunications industry where a number of holdings have
consolidated. But in other cases, mergers have already proven questionable
and have diminished rather than increased shareholder value.
8
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
During the last quarter of our fiscal year we realized a loss on the sale of
Raytheon, a company that had made two significant acquisitions.
Q: What is your view of the current market environment and your outlook for the
future?
A: Economic growth in 1999 has been ahead of many estimates we saw at this time
last year. In fact, it has been another excellent year for the American
economy. Results in the stock market have been more varied, with tremendous
gains in some areas and lackluster results elsewhere. The narrow focus of
the market on companies with the fastest earnings growth has been cited by
some as a cause to worry that the long bull market is cresting. With so many
fine companies having trouble securing investor interest, commentators point
to the possibility of a broad sell-off if and when the market leaders begin
to tumble. We are never sure what to make of market commentary like that,
since we do not believe that the market can be predicted with any kind of
consistent success. However, we do think it quite reasonable to expect
another turbulent year with many crosscurrents. But, as always, we shall
devote our major effort to finding and maintaining investments that we
believe will help you pursue your long-term investment goals.
9
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 10/31/99
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
INVESTMENT IN SECURITIES - 99.1%
CONVERTIBLE PREFERRED STOCKS - 1.7%
123,000 Cox Communications, Inc., 7.0%, 8/16/02 $ 7,626,000
500 Sprint Corp., 8.25%, 3/31/00 39,000
84,700 Union Pacific Capital Trust, 6.25%, 4/1/28 4,016,643
123,000 Union Pacific Capital Trust, 6.25%, 4/1/28 (144A) 5,832,906
--------------
Total Convertible Preferred Stocks
(Cost $15,571,733) $ 17,514,549
--------------
COMMON STOCKS - 97.4%
Basic Materials - 5.8%
Aluminum - 0.5%
88,000 Alcoa Inc. $ 5,346,000
--------------
Chemicals - 1.2%
197,632 E.I. du Pont de Nemours and Co. $ 12,734,912
--------------
Chemicals (Specialty) - 0.8%
144,700 Nalco Chemical Co. $ 7,641,969
--------------
Iron & Steel - 1.4%
130,000 AK Steel Holding Corp. $ 2,250,625
523,405 Roanoke Electric Steel Corp. 8,374,480
250,000 Worthington Industries, Inc. 4,156,250
--------------
$ 14,781,355
--------------
Metals Mining - 1.2%
217,600 Phelps Dodge Corp. $ 12,267,200
--------------
Paper & Forest Products - 0.7%
220,000 Consolidated Papers, Inc. $ 6,888,750
--------------
Total Basic Materials $ 59,660,186
--------------
Capital Goods - 5.7%
Aerospace/Defense - 1.2%
180,000 General Dynamics Corp. $ 9,978,750
107,500 Lockheed Martin Corp. 2,150,000
--------------
$ 12,128,750
--------------
Machinery (Diversified) - 1.3%
505,957 The Gorman-Rupp Co.+ $ 7,652,600
292,600 The Timken Co. 5,248,513
--------------
$ 12,901,113
--------------
</TABLE>
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Manufacturing (Diversified) - 1.4%
117,800 Johnson Controls, Inc. $ 7,156,350
80,000 Minnesota Mining & Manufacturing Co. 7,605,000
--------------
$ 14,761,350
--------------
Manufacturing (Specialized) - 0.4%
166,150 Diebold, Inc. $ 4,361,437
--------------
Trucks & Parts - 1.4%
310,500 PACCAR, Inc. $ 14,632,313
--------------
Total Capital Goods $ 58,784,963
--------------
Communications Services - 15.0%
Telecommunications - 0.4%
50,000 Sprint Corp. $ 3,715,625
--------------
Telephone - 14.6%
184,585 Alltel Corp. $ 15,366,701
75,000 Bell Atlantic Corp. 4,870,312
396,400 BellSouth Corp. 17,838,000
280,700 GTE Corp. 21,052,500
1,294,669 SBC Communications, Inc. 65,947,202
429,877 U.S. West Communications Group, Inc. 26,249,364
--------------
$ 151,324,079
--------------
Total Communications Services $ 155,039,704
--------------
Consumer Cyclicals - 8.6%
Automobiles - 3.6%
463,800 Ford Motor Co. $ 25,451,025
175,000 General Motors Corp. 12,293,750
--------------
$ 37,744,775
--------------
Auto Parts & Equipment - 2.0%
832,366 Delphi Automotive Systems Corp. $ 13,682,016
160,000 The Goodyear Tire & Rubber Co. 6,610,000
--------------
$ 20,292,016
--------------
Publishing - 0.9%
160,000 The McGraw-Hill Co., Inc. $ 9,540,000
--------------
Publishing (Newspapers) - 0.1%
20,000 Tribune Co. $ 1,200,000
--------------
Retail (Department Stores) - 1.5%
441,000 May Department Stores Co. $ 15,297,188
--------------
</TABLE>
The accompanying notes are an integral part of these financial statements. 11
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 10/31/99 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Services (Advertising/Marketing) - 0.5%
117,800 The Interpublic Group of Companies, Inc. $ 4,785,625
--------------
Total Consumer Cyclicals $ 88,859,604
--------------
Consumer Staples - 8.2%
Beverages - 0.4%
114,000 Pepsico, Inc. $ 3,954,375
--------------
Entertainment - 1.0%
531,200 Cedar Fair, L.P. $ 10,590,800
--------------
Foods - 5.6%
429,000 BestFoods $ 25,203,750
200,000 Campbell Soup Co. 9,000,000
148,000 General Mills, Inc. 12,903,750
157,750 H.J. Heinz Co. 7,532,563
120,000 Sara Lee Corp. 3,247,500
--------------
$ 57,887,563
--------------
Household Products (Non-Durables) - 0.9%
66,000 Colgate-Palmolive Co. $ 3,993,000
50,000 Procter & Gamble Co. 5,243,750
--------------
$ 9,236,750
--------------
Personal Care - 0.2%
50,000 Gillette Co. $ 1,809,375
--------------
Retail Stores (Food Chains) - 0.1%
50,000 Winn-Dixie Stores, Inc. $ 1,353,125
--------------
Total Consumer Staples $ 84,831,988
--------------
Energy - 7.5%
Oil (Domestic Integrated) - 2.6%
242,000 Atlantic Richfield Co. $ 22,551,375
153,306 Conoco, Inc. (Class B) 4,158,414
--------------
$ 26,709,789
--------------
Oil (International Integrated) - 4.9%
297,700 Chevron Corp. $ 27,183,731
144,000 Exxon Corp. 10,665,000
131,000 Mobil Corp. 12,641,500
--------------
$ 50,490,231
--------------
Total Energy $ 77,200,020
--------------
</TABLE>
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Financial - 17.0%
Banks (Major Regional) - 3.4%
186,600 The Bank of New York Co., Inc. $ 7,813,875
50,000 Comerica, Inc. 2,971,875
118,440 Fleet Financial Group, Inc. 5,166,945
266,600 Mellon Bank Corp. 9,847,538
304,000 National City Corp. 8,968,000
--------------
$ 34,768,233
--------------
Banks (Money Center) - 0.3%
40,000 The Chase Manhattan Corp. $ 3,495,000
--------------
Banks (Regional) - 5.5%
607,500 First Security Corp. $ 15,567,188
269,300 First Tennessee National Corp. 9,156,200
80,000 North Fork Bancorporation, Inc. 1,655,000
465,788 Old Kent Financial Corp. 18,980,861
283,900 SouthTrust Corp. 11,356,000
--------------
$ 56,715,249
--------------
Insurance (Life/Health) - 1.0%
54,100 American National Insurance Co. $ 3,705,850
146,000 Reliastar Financial Corp. 6,268,875
--------------
$ 9,974,725
--------------
Insurance (Property/Casualty) - 2.3%
170,100 Chubb Corp. $ 9,334,237
175,050 HSB Group, Inc. 6,695,663
237,800 St. Paul Companies, Inc. 7,609,600
--------------
$ 23,639,500
--------------
Investment Banking/Brokerage - 1.1%
125,000 Edwards (AG), Inc. $ 3,757,812
184,100 Paine Webber Group, Inc. 7,502,075
--------------
$ 11,259,887
--------------
Investment Management - 2.5%
232,600 Alliance Capital Management, L.P. $ 6,381,962
167,900 Eaton Vance Corp. (Non-voting) 5,740,081
402,000 T. Rowe Price Associates, Inc. 14,271,000
--------------
$ 26,393,043
--------------
</TABLE>
The accompanying notes are an integral part of these financial statements. 13
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 10/31/99 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Savings & Loan Companies - 0.9%
89,000 Astoria Financial Co. $ 3,204,000
24,600 Queens County Bancorp, Inc. 773,363
142,000 Washington Mutual, Inc. 5,103,125
--------------
$ 9,080,488
--------------
Total Financial $ 175,326,125
--------------
Healthcare - 9.5%
Healthcare (Diversified) - 3.8%
356,600 Abbott Laboratories $ 14,397,725
200,000 Bristol-Myers Squibb Co. 15,362,500
95,000 Johnson & Johnson 9,951,250
--------------
$ 39,711,475
--------------
Healthcare (Drugs/Major Pharmaceuticals) - 5.2%
160,400 Merck & Co., Inc. $ 12,761,825
821,600 Schering-Plough Corp. 40,669,200
--------------
$ 53,431,025
--------------
Healthcare (Medical Products/Supplies) - 0.5%
188,000 Becton, Dickinson & Co. $ 4,770,500
--------------
Total Healthcare $ 97,913,000
--------------
Technology - 5.8%
Communications Equipment - 0.3%
140,000 Harris Corp. $ 3,141,250
--------------
Computers (Hardware) - 2.1%
245,600 Hewlett-Packard Co. $ 18,189,750
30,000 IBM Corp. 2,951,250
--------------
$ 21,141,000
--------------
Equipment (Semiconductors) - 1.9%
497,000 Helix Technology Corp. $ 20,035,313
--------------
Photography/Imaging - 1.5%
230,000 Eastman Kodak Co. $ 15,855,625
--------------
Total Technology $ 60,173,188
--------------
Transportation - 1.0%
Railroads - 1.0%
115,000 Burlington Northern Santa Fe Corp. $ 3,665,625
293,600 Norfolk Southern Corp. 7,174,850
--------------
Total Transportation $ 10,840,475
--------------
</TABLE>
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Utilities - 13.3%
Electric Companies - 7.2%
296,200 Allegheny Energy, Inc. $ 9,422,862
185,400 American Electric Power Co., Inc. 6,396,300
636,500 Constellation Energy Group 19,532,594
372,350 DPL, Inc. 7,540,087
200,000 DQE, Inc. 7,987,500
179,000 Duke Energy Corp. 10,113,500
10,000 FPL Group, Inc. 503,125
284,400 Kansas City Power & Light Co. 6,967,800
140,000 NSTAR 5,328,750
--------------
$ 73,792,518
--------------
Natural Gas - 5.6%
100,600 Buckeye Partners, L.P. $ 2,628,175
190,750 Consolidated Natural Gas Co. 12,208,000
147,933 Indiana Energy, Inc. 2,986,397
454,700 KeySpan Energy Corp. 12,788,438
110,882 Kinder Morgan Energy Partners, L.P. 4,733,275
72,200 Lakehead Pipe Line Partners, L.P. (Preferred Units) 2,802,263
191,200 NICOR, Inc. 7,409,000
128,300 Public Service Co. of North Carolina, Inc. 4,033,431
446,600 Questar Corp. 8,038,800
--------------
$ 57,627,779
--------------
Power Producers (Independent) - 0.1%
100,000 Consol Energy, Inc. $ 1,162,500
--------------
Water Utility - 0.4%
150,400 American Water Works Co., Inc. $ 4,389,800
--------------
Total Utilities $ 136,972,597
--------------
Total Common Stocks
(Cost $715,036,934) $1,005,601,850
--------------
TOTAL INVESTMENT IN SECURITIES
(Cost $730,608,667) $1,023,116,399
--------------
</TABLE>
The accompanying notes are an integral part of these financial statements. 15
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 10/31/99 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C> <C>
TEMPORARY CASH INVESTMENT - 0.9%
Commercial Paper - 0.9%
$9,690,000 Household Finance Corp., 5.3%, 11/1/99 $ 9,690,000
--------------
TOTAL TEMPORARY CASH INVESTMENT
(Cost $9,690,000) $ 9,690,000
--------------
TOTAL INVESTMENT IN SECURITIES AND
TEMPORARY CASH INVESTMENT - 100%
(Cost $740,298,667)(a) $1,032,806,399
==============
</TABLE>
144A Security is exempt from registration under Rule 144A of the Securities Act
of 1933. Such securities may be resold normally to qualified institutional
buyers in a transaction exempt from registration. At October 31, 1999, the
value of these securities amounted to $5,832,906 or 0.6% of total net
assets.
+ Investment held by Fund representing 5% or more of the outstanding voting
stock of such company.
(a) At October 31, 1999, the net unrealized gain on investments based on cost
for federal income tax purposes of $736,144,517 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized gain for all investments in
which there is an excess of value over tax cost $317,296,822
Aggregate gross unrealized loss for all investments in
which there is an excess of tax cost over value (20,634,940)
------------
Net unrealized gain $296,661,882
============
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for the
year ended October 31, 1999, aggregated $275,326,300 and $229,644,539,
respectively.
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
BALANCE SHEET 10/31/99
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (including temporary cash investment
of $9,690,000) (cost $740,298,667) $ 1,032,806,399
Cash 647
Receivables -
Investment securities sold 479,484
Fund shares sold 1,513,288
Dividends and interest 2,566,425
Other 48,766
---------------
Total assets $ 1,037,415,009
---------------
LIABILITIES:
Payables -
Investment securities purchased $ 97,416
Fund shares repurchased 1,178,313
Due to affiliates 1,116,776
Accrued expenses 227,037
---------------
Total liabilities $ 2,619,542
---------------
NET ASSETS:
Paid-in capital $ 679,606,408
Accumulated undistributed net investment income 4,154,150
Accumulated undistributed net realized gain on investments 58,527,177
Net unrealized gain on investments 292,507,732
---------------
Total net assets $ 1,034,795,467
===============
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Class A (based on $661,597,667/22,076,829 shares) $ 29.97
===============
Class B (based on $328,360,194/11,027,865 shares) $ 29.78
===============
Class C (based on $41,320,267/1,389,150 shares) $ 29.75
===============
Class Y (based on $3,517,339/117,256 shares) $ 30.00
===============
MAXIMUM OFFERING PRICE:
Class A $ 31.80
===============
</TABLE>
The accompanying notes are an integral part of these financial statements. 17
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended 10/31/99
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Dividends $26,551,753
Interest 886,967
-----------
Total investment income $ 27,438,720
------------
EXPENSES:
Management fees $ 6,064,438
Transfer agent fees
Class A 1,052,943
Class B 607,456
Class C 99,823
Class Y 525
Distribution fees
Class A 1,628,508
Class B 3,202,140
Class C 349,438
Administrative fees 254,769
Custodian fees 94,796
Registration fees 263,685
Professional fees 67,044
Printing 105,094
Fees and expenses of nonaffiliated trustees 34,311
Miscellaneous 21,226
-----------
Total expenses $ 13,846,196
Less fees paid indirectly (193,672)
------------
Net expenses $ 13,652,524
------------
Net investment income $ 13,786,196
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments (including net realized
gain of $75 from affiliated companies) $ 61,324,548
Change in net unrealized gain on investments 25,524,442
------------
Net gain on investments $ 86,848,990
------------
Net increase in net assets resulting from operations $100,635,186
============
</TABLE>
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income 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 $ 13,786,196 $ 12,816,468
Net realized gain on investments 61,324,548 23,455,256
Change in net unrealized gain on investments 25,524,442 90,559,589
-------------- -------------
Net increase in net assets resulting from operations $ 100,635,186 $ 126,831,313
-------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ($0.47 and $0.48 per share, respectively) $ (10,285,113) $ (9,465,678)
Class B ($0.23 and $0.29 per share, respectively) (2,531,367) (2,681,431)
Class C ($0.21 and $0.29 per share, respectively) (249,159) (204,927)
Class Y ($0.58 and $0.13 per share, respectively) (65,967) (13,022)
Net realized gain:
Class A ($0.76 and $0.73 per share, respectively) (15,956,369) (13,377,646)
Class B ($0.76 and $0.73 per share, respectively) (7,785,465) (6,017,141)
Class C ($0.76 and $0.73 per share, respectively) (736,803) (384,858)
Class Y ($0.76 and $0.00 per share, respectively) (80,223) -
-------------- -------------
Total distributions to shareholders $ (37,690,466) $ (32,144,730)
-------------- -------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 277,147,856 $ 282,310,127
Reinvestment of distributions 34,629,922 29,629,866
Cost of shares repurchased (234,614,664) (177,923,138)
-------------- -------------
Net increase in net assets resulting from fund
share transactions $ 77,163,114 $ 134,016,855
-------------- -------------
Net increase in net assets $ 140,107,834 $ 228,703,465
NET ASSETS:
Beginning of year 894,687,633 665,984,168
-------------- -------------
End of year (including accumulated undistributed net
investment income of $4,154,150 and $2,858,114,
respectively) $1,034,795,467 $ 894,687,633
============== =============
</TABLE>
The accompanying notes are an integral part of these financial statements. 19
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
'99 Shares '99 Amount '98 Shares '98 Amount
<S> <C> <C> <C> <C>
CLASS A
Shares sold 5,534,197 $ 162,178,227 6,498,655 $ 176,430,152
Reinvestment of distributions 858,056 24,507,206 820,812 21,402,740
Less shares repurchased (5,110,961) (150,324,477) (4,779,787) (129,571,542)
---------- ------------- ---------- -------------
Net increase 1,281,292 $ 36,360,956 2,539,680 $ 68,261,350
========== ============= ========== =============
CLASS B
Shares sold 3,060,616 $ 89,638,439 3,260,906 $ 88,078,226
Reinvestment of distributions 322,601 9,146,739 300,913 7,743,240
Less shares repurchased (2,438,832) (71,739,397) (1,652,132) (44,685,857)
---------- ------------- ---------- -------------
Net increase 944,385 $ 27,045,781 1,909,687 $ 51,135,609
========== ============= ========== =============
CLASS C
Shares sold 834,174 $ 24,434,881 545,171 $ 14,756,877
Reinvestment of distributions 29,295 829,857 18,231 470,941
Less shares repurchased (404,784) (11,931,328) (133,683) (3,552,030)
---------- ------------- ---------- -------------
Net increase 458,685 $ 13,333,410 429,719 $ 11,675,788
========== ============= ========== =============
CLASS Y*
Shares sold 30,456 $ 896,309 106,376 $ 3,044,872
Reinvestment of distributions 5,108 146,120 473 12,945
Less shares repurchased (20,985) (619,462) (4,172) (113,709)
---------- ------------- ---------- -------------
Net increase 14,579 $ 422,967 102,677 $ 2,944,108
========== ============= ========== =============
</TABLE>
*Class Y shares were first publicly offered on July 2, 1998.
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income 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
<S> <C> <C> <C> <C> <C>
CLASS A
Net asset value, beginning of year $ 28.10 $ 24.78 $ 20.37 $ 18.22 $ 16.16
------- ------- ------- ------- -------
Increase from investment operations:
Net investment income $ 0.48 $ 0.49 $ 0.50 $ 0.55 $ 0.54
Net realized and unrealized gain on investments 2.62 4.04 5.36 2.24 2.45
------- ------- ------- ------- -------
Net increase from investment operations $ 3.10 $ 4.53 $ 5.86 $ 2.79 $ 2.99
Distributions to shareholders:
Net investment income (0.47) (0.48) (0.50) (0.50) (0.53)
Net realized gain (0.76) (0.73) (0.95) (0.14) (0.40)
------- ------- ------- ------- -------
Net increase in net asset value $ 1.87 $ 3.32 $ 4.41 $ 2.15 $ 2.06
------- ------- ------- ------- -------
Net asset value, end of year $ 29.97 $ 28.10 $ 24.78 $ 20.37 $ 18.22
======= ======= ======= ======= =======
Total return* 11.26% 18.69% 30.40% 15.53% 19.51%
Ratio of net expenses to average net assets 1.09%+ 1.05%+ 1.11%+ 1.19%+ 1.29%+
Ratio of net investment income to average net assets 1.62%+ 1.82%+ 2.22%+ 2.85%+ 3.26%+
Portfolio turnover rate 23% 12% 18% 47% 13%
Net assets, end of year (in thousands) $661,598 $584,389 $452,300 $336,384 $249,981
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.07% 1.04% 1.10% 1.18% 1.27%
Net investment income 1.64% 1.83% 2.23% 2.86% 3.28%
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 21
<PAGE>
Pioneer Equity-Income 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
<S> <C> <C> <C> <C> <C>
CLASS B
Net asset value, beginning of year $ 27.91 $ 24.63 $ 20.26 $ 18.15 $ 16.14
-------- -------- -------- -------- -------
Increase from investment operations:
Net investment income $ 0.25 $ 0.29 $ 0.33 $ 0.41 $ 0.45
Net realized and unrealized gain on investments 2.61 4.01 5.32 2.22 2.41
-------- -------- -------- -------- -------
Net increase from investment operations $ 2.86 $ 4.30 $ 5.65 $ 2.63 $ 2.86
Distributions to shareholders:
Net investment income (0.23) (0.29) (0.33) (0.38) (0.45)
Net realized gain (0.76) (0.73) (0.95) (0.14) (0.40)
-------- -------- -------- -------- -------
Net increase in net asset value $ 1.87 $ 3.28 $ 4.37 $ 2.11 $ 2.01
-------- -------- -------- -------- -------
Net asset value, end of year $ 29.78 $ 27.91 $ 24.63 $ 20.26 $ 18.15
======== ======== ======== ======== =======
Total return* 10.43% 17.83% 29.35% 14.70% 18.64%
Ratio of net expenses to average net assets 1.87%+ 1.82%+ 1.88%+ 1.95%+ 2.02%+
Ratio of net investment income to average net assets 0.84%+ 1.05%+ 1.45%+ 2.06%+ 2.35%+
Portfolio turnover rate 23% 12% 18% 47% 13%
Net assets, end of year (in thousands) $328,360 $281,469 $201,360 $134,657 $60,433
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.85% 1.81% 1.87% 1.94% 1.98%
Net investment income 0.86% 1.06% 1.46% 2.07% 2.39%
</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.
22 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 10/31/99
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended 1/31/96 to
10/31/99 10/31/98 10/31/97 10/31/96
<S> <C> <C> <C> <C>
CLASS C
Net asset value, beginning of year $ 27.88 $ 24.61 $ 20.25 $ 19.49
------- ------- ------- -------
Increase from investment operations:
Net investment income $ 0.22 $ 0.27 $ 0.32 $ 0.27
Net realized and unrealized gain on investments 2.62 4.02 5.32 0.76
------- ------- ------- -------
Net increase from investment operations $ 2.84 $ 4.29 $ 5.64 $ 1.03
Distributions to shareholders:
Net investment income (0.21) (0.29) (0.33) (0.27)
Net realized gain (0.76) (0.73) (0.95) -
------- ------- ------- --------
Net increase in net asset value $ 1.87 $ 3.27 $ 4.36 $ 0.76
------- ------- ------- --------
Net asset value, end of year $ 29.75 $ 27.88 $ 24.61 $ 20.25
======= ======= ======= =======
Total return* 10.35% 17.80% 29.32% 5.34%
Ratio of net expenses to average net assets 1.97%+ 1.89%+ 1.93%+ 1.98%**+
Ratio of net investment income to average net assets 0.74%+ 0.97%+ 1.35%+ 1.91%**+
Portfolio turnover rate 23% 12% 18% 47%
Net assets, end of year (in thousands) $41,320 $25,941 $12,324 $ 4,144
Ratios assuming reduction for fees paid indirectly:
Net expenses 1.94% 1.87% 1.91% 1.94%**
Net investment income 0.77% 0.99% 1.37% 1.95%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 23
<PAGE>
Pioneer Equity-Income 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 $28.13 $28.72
------ ------
Increase (decrease) from investment operations:
Net investment income $ 0.59 $ 0.18
Net realized and unrealized gain (loss) on investments 2.62 (0.64)
------ -------
Net increase (decrease) from investment operations $ 3.21 $(0.46)
Distributions to shareholders:
Net investment income (0.58) (0.13)
Net realized gain (0.76) -
------ -------
Net increase (decrease) in net asset value $ 1.87 $(0.59)
------ -------
Net asset value, end of period $30.00 $28.13
====== ======
Total return* 11.67% (1.59)%
Ratio of net expenses to average net assets 0.70%+ 0.74%**+
Ratio of net investment income to average net assets 2.01%+ 2.07%* +
Portfolio turnover rate 23% 12%
Net assets, end of period (in thousands) $3,517 $2,888
Ratios assuming reduction for fees paid indirectly:
Net expenses 0.69% 0.74%**
Net investment income 2.02% 2.07%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions and the complete redemption of the
investment at net asset value at the end of each period.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
24 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 10/31/99
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Equity-Income Fund (the Fund), is a Delaware business trust registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objectives of the Fund are current income and
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 shareholders.
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.
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 to first select for sale those
25
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 10/31/99 (continued)
- --------------------------------------------------------------------------------
securities that have the highest cost and also qualify for long-term capital
gain or loss treatment for tax purposes.
Settlements from litigation and class action suits are recognized when the
Fund acquires an enforceable right to such awards. Included in net realized
gain from investments is $44,102 of class action settlements received by the
Fund during the year ended October 31, 1999.
B. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareholders. Therefore, no federal income tax provision is required.
The characterization of distributions to shareholders for financial reporting
purposes is determined in accordance with federal income tax rules.
Therefore, the source of the Fund's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
At October 31, 1999, the Fund has reclassified $641,446 from accumulated
undistributed net realized gain on investments to accumulated undistributed
net investment income. 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 $60,422,307 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 subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $347,723 in
underwriting commissions on the sale of fund shares during the year ended
October 31, 1999.
26
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
D. Class Allocations
Distribution fees are calculated based on the average daily net asset value
attributable to Class A, Class B, 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 at the annual rate of 0.60% of the Fund's average daily net
assets up to $10 billion and 0.575% of the excess over $10 billion.
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Fund. At October 31, 1999, $529,274 was payable to PIM
related to management fees, administrative fees and certain others 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 $152,121 in transfer agent fees payable to PSC at October 31,
1999.
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.
27
<PAGE>
Pioneer Equity-Income Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 10/31/99 (continued)
- --------------------------------------------------------------------------------
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 $435,381 in 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 $596,231 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, 1999, the Fund's expenses were reduced by $193,672 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 borrowings. 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. For the year ended October 31, 1999, the Fund had no borrowings under
this agreement.
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Pioneer Equity-Income Fund
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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
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<S> <C> <C> <C> <C>
The Gorman-Rupp Co. $ - $8,095 $303,724 $7,652,600
- --------------------------------------------------------------------------------
</TABLE>
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Pioneer Equity-Income Fund
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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
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To the Shareowners and the Board of Trustees of Pioneer Equity-Income Fund:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer Equity-Income 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 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 Equity-Income 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
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Pioneer Equity-Income Fund
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TRUSTEES, OFFICERS AND SERVICE PROVIDERS
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<TABLE>
<CAPTION>
Trustees Officers
<S> <C>
John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
Mary K. Bush President
Richard H. Egdahl, M.D. David D. Tripple, Executive Vice
Margaret B.W. Graham President
John W. Kendrick John A. Carey, Vice President
Marguerite A. Piret Eric W. Reckard, Treasurer
David D. Tripple Joseph P. Barri, Secretary
Stephen K. West
John Winthrop
</TABLE>
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
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PROGRAMS AND SERVICES FOR PIONEER SHAREOWNERS
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Your investment representative can give you additional information on Pioneer's
programs and services. If you want to order literature on any of the following
items directly, simply call Pioneer at 1-800-225-6292.
FactFone(SM)
Our automated account information service, available to you 24 hours a day,
seven days a week. FactFone gives you a quick and easy way to check fund share
prices, yields, dividends and distributions, as well as information about your
own account. Simply call 1-800-225-4321. For specific account information, have
your 13-digit account number and four-digit personal identification number at
hand.
90-Day Reinstatement Privilege (for Class A Shares)
Enables you to reinvest all or a portion of the money you redeem from your
Pioneer account - without paying a sales charge - within 90 days of your
redemption. You have the choice of investing in any Pioneer fund, as long as you
meet its minimum investment requirement.
Investomatic Plan
An easy and convenient way for you to invest on a regular basis. All you need to
do is authorize a set amount of money to be moved out of your bank account into
the Pioneer fund of your choice. Investomatic also allows you to change the
dollar amount, frequency and investment date right over the phone. By putting
aside affordable amounts of money regularly, you can build a long-term
investment - without sacrificing your current standard of living.
Payroll Investment Program (PIP)
Lets you invest in a Pioneer fund directly through your paycheck. All that's
involved is for your employer to fill out an authorization form allowing Pioneer
to deduct from participating employees' paychecks. You specify the dollar amount
you want to invest into the Pioneer fund(s) of your choice.
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Automatic Exchange Program
A simple way to move money from 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.)
33
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RETIREMENT PLANS FROM PIONEER
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Pioneer has a long history of helping people work toward their retirement goals,
offering plans suited to the individual investor and businesses of all sizes.
For more information on Pioneer retirement plans, contact your investment
professional, or call Pioneer at 1-800-622-0176.
Individual Retirement Account (IRA)
Traditional IRA
A Traditional IRA allows anyone under age 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
Contributions, up to $2,000 a year per person in earned income, are not
tax-deductible, but earnings are tax-free for qualified withdrawals. You can
contribute beyond age 70-1/2, although there are income limits for contributions
at any age.
401(k) Plan
The traditional 401(k) plan allows employees to make pre-tax contributions
through payroll deduction, up to $10,000 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.
Most retirement plan withdrawals must meet
specific conditions to avoid penalties.
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403(b) Plan
Also known as a Tax-Sheltered Account (TSA), a 403(b) plan is available only to
employees of public schools, not-for-profit hospitals and other tax-exempt
organizations. A 403(b) plan lets employees set aside a portion of their salary,
before taxes, through payroll deduction.
Simplified Employee Pension Plan (SEP)
SEPs let self-employed people and small-business owners make tax-deductible
contributions of up to 15% of their income. Generally, employers must contribute
the same percentage of pay for themselves and any eligible employees;
contributions are made directly to employees' IRAs. SEPs are easy to administer
and can be an especially good choice for firms with few or no employees.
Profit Sharing Plan
Profit sharing plans offer companies considerable flexibility, allowing them to
decide each year whether a contribution will be made and how much, up to 15% of
each participant's pay. These plans can include provisions for loans and vesting
schedules.
Age-Based Profit Sharing Plan
Like traditional profit sharing plans, employer contributions are flexible, but
age-based plans allocate contributions based on both age and salary. Age-based
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.
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THE PIONEER FAMILY OF MUTUAL FUNDS
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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
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This page for your notes.
37
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HOW TO CONTACT PIONEER
- --------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
Pioneering Services Corporation
60 State Street
Boston, Massachusetts 02109
Our toll-free fax 1-800-225-4240
Our Internet e-mail address [email protected]
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
This report must be preceded or accompanied by a current Fund prospectus.
[Pioneer Logo]
Pioneer Investment Management, Inc.
60 State Street 7260-00-1299
Boston, Massachusetts 02109 (C) Pioneer Funds Distributor, Inc.
www.pioneerfunds.com [Recycle logo] Printed on Recycled Paper
