<PAGE> 1
AIM ASIAN GROWTH FUND
[AIM LOGO APPEARS HERE] SEMIANNUAL REPORT APRIL 30, 1998
<PAGE> 2
AIM ASIAN GROWTH FUND
For shareholders who seek
long-term growth of capital.
The Fund invests in a
diversified portfolio of
equity securities of companies
located in Asia
with strong earnings momentum.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Asian Growth Fund's performance figures are historical and reflect
reinvestment of all distributions and changes in net asset value. Unless
otherwise indicated, the Fund's performance is computed without a sales
charge.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B and Class C
share performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the Fund's Class B and Class C shares will differ from
that of Class A shares due to differences in sales charge structure and Fund
expenses.
o Because the Fund's Class A, B, and C shares have been offered for less than
one year (since 11/3/97), all total return figures reflect cumulative total
returns that have not been annualized.
o The Fund's investment return and principal value will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
o Past performance cannot guarantee comparable future results.
o International investing presents certain risks not associated with investing
solely in the U.S. These include risks relating to fluctuations in the value
of the U.S. dollar relative to the value of other currencies, the custody
arrangements made for the Fund's foreign holdings, differences in
accounting, political risks, and the lesser degree of public information
required to be provided by non-U.S. companies.
o The Fund's portfolio composition is subject to change, and there is no
assurance the Fund will continue to hold any particular security.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The Morgan Stanley Capital International (MSCI) All Country (AC) Asia Free
Ex-Japan Fund Index is a group of unmanaged Asian securities (excluding
Japan) tracked by Morgan Stanley Capital International.
o An investment cannot be made in any index listed. Unless otherwise
indicated, index results include reinvested dividends and do not reflect
sales charges.
MUTUAL FUNDS, ANNUITIES, AND OTHER INVESTMENTS ARE NOT INSURED BY THE
FDIC OR ANY OTHER GOVERNMENT AGENCY; ARE NOT DEPOSITS OR OTHER
OBLIGATIONS OF, OR GUARANTEED BY, ANY BANK OR ANY AFFILIATE;
AND ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE
LOSS OF PRINCIPAL AMOUNT INVESTED.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the Fund.
<PAGE> 3
The Chairman's Letter
----------------------
For investors,
the best course is
to remain
realistic and ready.
----------------------
Dear Fellow Shareholder:
Last October, equity markets worldwide had just been shaken
[PHOTO OF by the currency crisis in Southeast Asia. By the April 30,
Charles T. 1998, end of this reporting period, most markets had
Bauer, recovered nicely, with U.S. equities reaching new highs and
Chairman of European markets outdoing even the U.S.'s heady pace.
the Board. However, Asian markets remained in the doldrums.
APPEARS HERE] Of course, Asia is not a single entity, and even though
financial trouble was widespread, there were some strong
points, especially in more mature markets like Hong Kong.
Still, most market participants felt that the turmoil in
Asia was not yet completed, and no one was certain how long
it would last or how serious it would be in the future.
For investors, the best course is to remain realistic
and ready. A well-diversified portfolio is still one of the
most effective tools for coping with shifts in a market's
direction because different asset classes and different
national markets tend to move independently of one another. Of course, your
financial consultant remains your best source of information about how to
allocate your investments based on your particular goals and situation.
AIM FURTHER DIVERSIFIES ITS OFFERINGS
Shortly after the close of this reporting period, AIM broadened its offerings to
shareholders through the addition of the GT Global group of mutual funds. During
the next few months you will be receiving more details about this transaction
and the products it adds to The AIM Family of Funds--Registered Trademark--.
In addition to making a more varied group of investments available to our
shareholders, this transaction helps strengthen AIM's position as a major
participant in the money-management industry worldwide. Such strength will
enable us to continue expanding both the scope of our fund offerings and our
menu of services for our shareholders.
YOUR FUND MANAGERS' COMMENTS
On the pages that follow, the managers of your AIM Fund discuss how the Fund
performed during the period covered by this report and give their near-term
market outlook. We hope you will find their discussion informative.
We are pleased to send you this report on your fund. If you have any
questions or comments, please contact our Client Services department at
800-959-4246 or visit our Web site at www.aimfunds.com. You can access
information about your account on our Web site and also on our automated AIM
Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of
Funds--Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
<PAGE> 4
The Managers' Overview
NEW FUND FACES CHALLENGES IN ASIA
A roundtable discussion with the Fund management team for AIM Asian Growth Fund
for the period ended April 30, 1998.
- --------------------------------------------------------------------------------
Q. AIM ASIAN GROWTH FUND BEGAN OPERATIONS ON NOVEMBER 3, 1997. HOW DID IT
PERFORM DURING ITS FIRST SIX MONTHS?
A. The Fund made its debut in November in the midst of a major crisis in Asian
markets. The extent of the turmoil, especially during the fourth quarter of
1997, is reflected in the Fund's performance. Cumulative total returns for
the period ended April 30, 1998 stood at -7.80% for Class A shares. Class B
and C shares each ended the period with -8.00% cumulative total returns.
In comparison, the Fund did better than its index. The Morgan Stanley
Capital International (MSCI) All Country Asia Free ex-Japan Index had a
total return of -16.77% for the same period.
The Fund's performance picked up during the first quarter of 1998 when
some Asian markets experienced a rebound. For just the first quarter of
1998, Class A shares had a total return of 12.14%.
Please keep in mind that six months is a very short time to consider
when examining results. The performance figures seen in the Fund during the
reporting period are not unusual, particularly in a market that is
experiencing extreme volatility. Remember that the AIM Asian Growth Fund is
a long-term investing vehicle, seeking aggressive growth over time.
Q. HOW DID ASIAN MARKETS PERFORM DURING THE REPORTING PERIOD?
A. The basic cause of the Asian crisis was too much growth in Asia, too fast.
Poor monetary management in the region had caused interest rates to drop.
Many Southeast Asian countries borrowed huge amounts of money and went on a
spending and building spree. The growth went unchecked until last summer,
when Thailand, South Korea, and Indonesia devalued their currencies. Foreign
investors began to sell these currencies, and what followed was a cash-flow
crunch that caused turmoil in the region's markets.
During the fourth quarter, Asian markets declined steeply. In the first
quarter of 1998, the way the story continued depended on where you were.
Indonesia went from bad to worse. The country failed to cooperate with the
International Monetary Fund (IMF) after numerous negotiations. Social unrest
finally exploded violently after the end of the reporting period.
But in some areas--notably Thailand and South Korea--there were
significant recoveries in the first quarter of 1998. Thailand brought in
several consecutive months of trade surpluses, which released some of the
pressure on its currency, allowing it to strengthen. Interest rates
WHERE THE FUND MAY INVEST
[MAP]
BANGLADESH MALAYSIA
CHINA AUSTRALIA
INDIA NEW ZEALAND The Fund seeks companies of all sizes: small,
medium, and large market capitalizations, and
PAKISTAN HONG KONG may invest in any of these countries shown
at left.
SRI LANKA TAIWAN
THAILAND VIETNAM
SINGAPORE PHILIPPINES
INDONESIA SOUTH KOREA
dropped, which contributed to the market rebound. Both South Korea and
Thailand achieved some momentum in recapitalizing their banking systems.
However, a short rally experienced early in the first quarter eventually
evened out, leaving Asian markets quite weak.
Q. WHERE DID THE FUND FIND OPPORTUNITIES IN SUCH A DIFFICULT ENVIRONMENT?
A. As our first-quarter performance indicates, the Fund is doing relatively
well despite the challenges it faces. We've achieved these results by
adopting a defensive posture--avoiding the troubled economies of Southeast
Asia and focusing on more mature markets like Hong Kong, where earnings are
more consistent.
Another area of interest was India. It has been a very insular economy,
but now it's opening up. Investment and trade barriers are coming down and
we're seeing less currency volatility. We've also
See important fund and index disclosures inside front cover.
2
<PAGE> 5
PORTFOLIO COMPOSITION
As of 4/30/98, based on total net assets
<TABLE>
<CAPTION>
====================================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 COUNTRIES TOP 10 INDUSTRIES
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Philippine Long Distance Telephone Co. 1. Hong Kong 27.98% 1. Banks (Major Regional) 7.17%
(Philippines) 2.30%
2. Philippines 14.90 2. Land Development 5.50
2. Bajaj Auto Ltd. (India) 2.28
3. Australia 12.95 3. Broadcasting (Television, Radio & Cable) 5.23
3. Li & Fung Ltd. (Hong Kong) 2.28
4. India 8.36 4. Telecommunications (Cellular/Wireless) 4.25
4. Videsh Sanchar Nigam Ltd. (India) 2.26
5. Thailand 7.52 5. Automobiles 4.18
5. Elec & Eltek International Co. Ltd.
(Singapore) 2.24 6. Singapore 4.19 6. Computers (Hardware) 4.08
6. Guangdong Kelon Electrical Holdings Co. Ltd. 7. Taiwan 3.58 7. Telephone 4.07
(Hong Kong) 2.17
8. New Zealand 1.77 8. Electronics (Semiconductors) 3.58
7. Shenzhen Expressway Co. Ltd. (Hong Kong) 2.14
9. Indonesia 1.67 9. Oil & Gas (Exploration & Production) 3.38
8. Ng Fung Hong Ltd. (Hong Kong) 2.09
10.Malaysia 1.52 10.Manufacturing (Diversified) 3.26
9. Village Roadshow Ltd. (Australia) 2.09
10.Australia & New Zealand Banking Group Ltd.
(Australia) 2.07
Please keep in mind that the Fund's portfolio is subject to change and there is
no assurance the Fund will continue to hold any particular security.
====================================================================================================================================
</TABLE>
found growth in smaller pockets of Asia. For instance, Taiwanese electronics
and computer-related companies have continued to dominate their global
markets.
Overall, China is seeing some of the best economic growth. The so-called
"red-chip" stocks--stocks of Hong Kong-based units of mainland-Chinese
firms--had strong earnings momentum.
Q. WHAT HAS BEEN YOUR STRATEGY IN BUILDING THE PORTFOLIO?
A. We follow an earnings momentum discipline. Rather than making "big picture"
forecasts about all of Asia, we focus on selecting stocks of individual
companies with increasing earnings. The Fund can select stocks from all
capitalization levels, but we made more defensive selections during the
reporting period, focusing on large-cap names.
Our decision process during this time revolves around three critical
indicators of performance: 1) We look for dollar earners--that is,
exporters, especially to Europe and the U.S. 2) We look for companies with
growth, clean balance sheets, very little dollar debt, and net cash
positions. We try to find those players that can exploit a market niche, or
that can take advantage of Asian networks. 3) We also want companies that
have demonstrated competent management, particularly through an earnings
track-record.
Q. DESCRIBE THE PORTFOLIO AT THE END OF THE REPORTING PERIOD.
A. There were 48 names in the portfolio at the end of the reporting period,
representing 10 different countries. Our largest industry exposure was in
major regional banks, with just over 7% of the portfolio invested there. An
example from this industry is the Oversea-Chinese Banking Corporation. The
company is run to exacting guidelines; it was recently ranked by Moody's as
one of the three strongest banks in Asia.
Other prominent holdings at the end of the reporting period included
several Indian companies. Bajaj Auto Ltd. was attractive because of its very
large cash surplus. Videsh Sanchar Nigam Ltd. is a telecommunications
company and one of India's largest international equities.
Strong examples from Hong Kong include Johnson Electric Holdings Ltd., a
maker of micro-motors for use in hand tools and automobiles. Another example
is Li & Fung Ltd., China's leading trading firm and a company with a history
of innovation and regional strategizing. Many goods exported from Asia are
made of components produced in multiple Asian countries. Li & Fung
coordinates the shipping of these components to their destined production
facility, then delivers the finished good to retailers in Europe and
America. It's a great example of the strong interconnectedness of Asian
economies.
Q. WHAT IS YOUR OUTLOOK FOR THE NEAR FUTURE?
A. We believe that Asia still presents investment opportunities. Moreover,
there is long-term growth potential in many Asian countries, despite their
problems now. However, we remain defensive, biased toward a slowdown in
economic growth and lowered earnings expectations in the near-term.
The region's rebound hinges on reform. If reform measures are
successful, that will bolster the markets over the long term. After the
crisis, Asia may have a firmer economic base and stronger banking systems.
If so, we may see even stronger growth than we saw in the early '90s. That
makes the AIM Asian Growth Fund a good choice for the aggressive investor
with an eye on the long-term.
See important fund and index disclosures inside front cover.
3
<PAGE> 6
For Consideration
THE ROTH IRA: THE POWER TO KEEP MORE
Contribute After-Tax Dollars Now . . . So You Can Get Federally Tax-Free Savings
Later
A new and potentially more powerful type of IRA--the Roth IRA--became available
on January 1, 1998. What makes it more powerful? The Roth IRA gives you the
opportunity to keep more of what you earn.
Are you eligible to open a Roth IRA? The answer is yes if you or your spouse
has earned income for the tax year for which you want to make the contribution,
and your adjusted gross income is below $110,000 if you are a single tax filer,
$160,000 if you file jointly.
TWO KEY ROTH IRA BENEFITS:
TAX-FREE AND PENALTY-FREE WITHDRAWALS
o Of earnings after five years. Earnings on your Roth IRA are federally
tax-free if your Roth IRA account has been open for five years and you are at
least 59 1/2 years old, or in the case of death or disability. You may also use
up to $10,000 of your earnings to buy a first home (after five years).
o Of contributions at any time. For instance, if you make annual contributions
of $2,000 for the next three years, you may take out up to $6,000 and use that
money for any purpose.
HOW YOU MIGHT PUT BOTH BENEFITS TO WORK FOR YOU
Here's an example of how you may take full advantage of a Roth IRA. You are 39
1/2 years old. You contribute $2,000 after-tax annually in your Roth IRA every
year for 20 years, earning an average annual return of 10%. After 20 years, your
account has grown to $126,005. Now at age 59 1/2 you can begin taking
withdrawals and pay no federal income tax or penalty on any of your $126,005. Or
you can keep your money invested and take it out whenever you need it.
THE ROTH IRA: TO CONVERT OR NOT TO CONVERT
Can you convert your Traditional IRA to a Roth IRA? The answer is yes if you
meet these requirements:
You must pay taxes on the amount you convert. If you convert in 1998, you
can spread your tax payments over the next four years. This four-year allowance
will not be available after December 31, 1998.
You cannot convert to a Roth IRA if you are married and file your tax return
separately, or if your annual gross income is over $100,000.
SOME ROTH IRA CONVERSION GUIDELINES
If you can check most of these boxes, converting your Traditional IRA to a Roth
IRA may make sense for you.
o You have assets outside your retirement savings with which you can easily
afford to pay the taxes due when you convert.
o You have 10 years or more before you retire. The longer you invest tax-free,
the more you benefit.
o Your tax rate will probably be higher in retirement than it is now. If so,
you'll pay less taxes now to convert than you would pay at retirement if you
withdrew from a traditional IRA.
o You plan to convert in 1998. On January 1, 1999, the ability to spread tax
payments over four years disappears.
o You want to keep making contributions after age 70 1/2 and may wish to pass
your IRA assets on to your heirs after your death.
ROTH IRA CALCULATOR & ANALYZER
The Roth IRA Analyzer & Calculator at AIM's Internet Web site--
www.aimfunds.com-- can help you determine your IRA eligibility status and
whether it makes sense for you to convert an existing IRA into a Roth IRA.
MAKE YOUR IRA CONVERSION DECISION A TRULY INFORMED ONE
Talk to your financial consultant, who knows your specific needs and goals. You
may also wish to talk with a tax adviser.
This discussion does not constitute tax advice. Your tax adviser can provide
guidance concerning your particular situation.
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-84.44%
AUSTRALIA-12.95%
Australia & New Zealand Banking Group
Ltd. (Banks-Major Regional) 28,367 $ 198,031
- --------------------------------------------------------------
James Hardie Industries Ltd.
(Building Materials) 63,780 197,602
- --------------------------------------------------------------
Novus Petroleum Ltd.
(Oil & Gas-Exploration &
Production) 61,501 127,964
- --------------------------------------------------------------
Publishing & Broadcasting Ltd.
(Broadcasting-Television, Radio &
Cable) 33,537 160,341
- --------------------------------------------------------------
TABCORP Holdings Ltd.
(Leisure Time Products) 34,525 188,033
- --------------------------------------------------------------
Telstra Corp. Ltd. (Telephone) 72,213 169,563
- --------------------------------------------------------------
Village Roadshow Ltd.,
6.50% Pfd. (Entertainment) 4,000 200,000
- --------------------------------------------------------------
1,241,534
- --------------------------------------------------------------
HONG KONG-27.98%
China Resources Beijing Land
(Land Development) 334,000 176,788
- --------------------------------------------------------------
China Resources Enterprise Ltd.
(Manufacturing-Diversified) 84,000 144,229
- --------------------------------------------------------------
Cosco Pacific Ltd.
(Financial-Diversified) 254,000 172,153
- --------------------------------------------------------------
Dao Heng Bank Group Ltd.
(Banks-Regional) 58,000 171,469
- --------------------------------------------------------------
Guangdong Kelon Electrical Holdings
Co. Ltd.
(Household Furniture & Appliance) 203,000 208,346
- --------------------------------------------------------------
HKR International Ltd.
(Land Development) 282,800 169,768
- --------------------------------------------------------------
Hong Kong & China Gas Co. Ltd.
(Natural Gas) 135,500 184,550
- --------------------------------------------------------------
HSBC Holdings PLC
(Banks-Major Regional) 5,200 148,360
- --------------------------------------------------------------
Hutchison Whampoa Ltd.
(Retail-Food Chains) 29,000 179,331
- --------------------------------------------------------------
Johnson Electric Holdings Ltd.
(Electrical Equipment) 52,500 177,914
- --------------------------------------------------------------
Li & Fung Ltd.(Distributors-Food &
Health) 130,000 218,177
- --------------------------------------------------------------
New World Infrastructure Ltd.
(Services-Commercial & Consumer)(a) 30,200 64,915
- --------------------------------------------------------------
Ng Fung Hong Ltd. (Foods) 222,000 200,620
- --------------------------------------------------------------
Road King Infrastructure Ltd.
(Building & Construction) 100,000 92,951
- --------------------------------------------------------------
Shanghai Industrial Holdings Ltd.
(Manufacturing-Diversified) 49,000 167,951
- --------------------------------------------------------------
Shenzhen Expressway Co. Ltd.
(Services-Commercial & Consumer) 748,000 205,203
- --------------------------------------------------------------
2,682,725
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INDIA-8.36%
Bajaj Auto Ltd. (Automobiles) 11,500 $ 218,500
- --------------------------------------------------------------
ITC Ltd. (Tobacco)(a) 8,000 184,000
- --------------------------------------------------------------
Mahindra & Mahindra Ltd.
(Automobiles) 24,700 182,163
- --------------------------------------------------------------
Videsh Sanchar Nigam Ltd.
(Telecommunications-
Cellular/Wireless)(a) 17,700 216,825
- --------------------------------------------------------------
801,488
- --------------------------------------------------------------
INDONESIA-1.67%
Gulf Indonesia Resources Ltd.
(Oil-International Integrated)(a) 10,400 159,900
- --------------------------------------------------------------
MALAYSIA-1.52%
Gamuda Berhad
(Engineering & Construction) 128,000 145,204
- --------------------------------------------------------------
NEW ZEALAND-1.77%
Sky Network Television Ltd.-ADR
(Broadcasting-Television, Radio &
Cable)(a) 11,300 169,500
- --------------------------------------------------------------
PHILIPPINES-14.90%
Datacraft Asia Ltd.
(Communications Equipment) 52,000 175,760
- --------------------------------------------------------------
Digital Telecommunications Phils.,
Inc.
(Telecommunications-
Cellular/Wireless)(a) 4,392,900 190,377
- --------------------------------------------------------------
International Container Terminal
Services, Inc. (Air Freight)(a) 1,089,000 143,753
- --------------------------------------------------------------
Natsteel Electronics Ltd.
(Computers-Hardware)(a) 90,000 176,248
- --------------------------------------------------------------
Oversea-Chinese Banking Corp. Ltd.
(Banks-Major Regional) 35,900 189,365
- --------------------------------------------------------------
Overseas Union Bank Ltd.
(Banks-Major Regional) 40,000 151,611
- --------------------------------------------------------------
Philippine Long Distance Telephone
Co. (Telephone) 8,230 220,355
- --------------------------------------------------------------
SM Prime Holdings Inc.
(Land Development) 1,005,000 180,224
- --------------------------------------------------------------
1,427,693
- --------------------------------------------------------------
SINGAPORE-4.19%
Creative Technology Ltd.
(Computers-Peripherals)(a) 9,100 186,550
- --------------------------------------------------------------
Elec & Eltek International Co. Ltd.
(Computers-Hardware) 37,000 214,600
- --------------------------------------------------------------
401,150
- --------------------------------------------------------------
TAIWAN-3.58%
ASE Test Ltd.
(Electronics-Semiconductors)(a) 2,900 146,450
- --------------------------------------------------------------
Taiwan Semiconductor Manufacturing
Co.-ADR
(Electronics-Semiconductors)(a) 8,000 196,500
- --------------------------------------------------------------
342,950
- --------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
THAILAND-7.52%
Banpu Public Co. Ltd. (Metals Mining) 26,400 $ 181,693
- --------------------------------------------------------------
BEC World Public Co. Ltd.
(Broadcasting-Television, Radio &
Cable) 32,400 171,012
- --------------------------------------------------------------
Delta Electronics Public Co. Ltd.
(Electronics-Instrumentation) 12,700 130,779
- --------------------------------------------------------------
Delta Electronics Public Co.
Ltd.-Rights, expiring 05/15/98
(Electronics-Instrumentation) 4,050 40,657
- --------------------------------------------------------------
PTT Exploration and Production Public
Co. Ltd.
(Oil & Gas-Exploration &
Productions) 18,600 196,347
- --------------------------------------------------------------
720,488
- --------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (excluding
repurchase agreement) (Cost
$8,018,264) 8,092,632
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
<S> <C> <C>
REPURCHASE AGREEMENT-13.32%(b)
Goldman Sachs & Co., 5.53%,
05/01/98(c)
(Cost $1,276,349) $1,276,349 $1,276,349
- --------------------------------------------------------------
TOTAL INVESTMENTS-97.76% 9,368,981
- --------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-2.24% 215,391
- --------------------------------------------------------------
NET ASSETS-100.00% $9,584,372
==============================================================
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Collateral on repurchase agreements, including the Fund's pro-rata interest
in joint repurchase agreements, is taken into possession by the Fund upon
entering into the repurchase agreement. The collateral is marked to market
daily to ensure its market value as being 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds, private
accounts, and certain non-registered investment companies managed by the
investment advisor or its affiliates.
(c) Joint repurchase agreement entered into 04/30/98 with a maturing value of
$500,076,806. Collateralized by $495,889,000 U.S. Government obligations, 0%
to 7.75% due 07/23/98 to 01/15/08 with an aggregate market value at 04/30/98
of $510,500,080.
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$8,018,264) $ 8,092,632
- -----------------------------------------------------------
Repurchase agreement (cost $1,276,349) 1,276,349
- -----------------------------------------------------------
Foreign currencies, at value (cost $16,192) 15,945
- -----------------------------------------------------------
Receivables for:
Investments sold 73,013
- -----------------------------------------------------------
Capital stock sold 457,641
- -----------------------------------------------------------
Dividends and interest 19,742
- -----------------------------------------------------------
Reimbursement from advisor 58,000
- -----------------------------------------------------------
Other assets 59,744
- -----------------------------------------------------------
Total assets 10,053,066
- -----------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 436,017
- -----------------------------------------------------------
Capital stock reacquired 10,000
- -----------------------------------------------------------
Accrued advisory fees 6,761
- -----------------------------------------------------------
Accrued administrative services fees 6,199
- -----------------------------------------------------------
Accrued directors' fees 776
- -----------------------------------------------------------
Accrued distribution fees 3,711
- -----------------------------------------------------------
Accrued transfer agent fees 4,353
- -----------------------------------------------------------
Accrued operating expenses 877
- -----------------------------------------------------------
Total liabilities 468,694
- -----------------------------------------------------------
Net assets applicable to shares outstanding $ 9,584,372
===========================================================
NET ASSETS:
Class A $ 6,969,678
===========================================================
Class B $ 2,189,314
===========================================================
Class C $ 425,380
===========================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 756,207
===========================================================
Class B:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 237,961
===========================================================
Class C:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 46,262
===========================================================
Class A:
Net asset value and redemption price per
share $ 9.22
===========================================================
Offering price per share:
(Net asset value of $9.22 / 94.50%) $ 9.76
===========================================================
Class B:
Net asset value and offering price per
share $ 9.20
===========================================================
Class C:
Net asset value and offering price per
share $ 9.20
===========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the period November 3, 1997 (date operations commenced) through April 30,
1998
(Unaudited)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $2,342 foreign withholding
tax) $ 35,505
- -----------------------------------------------------------
Interest 13,199
- -----------------------------------------------------------
Total investment income 48,704
- -----------------------------------------------------------
EXPENSES:
Advisory fees 18,147
- -----------------------------------------------------------
Administrative services fees 33,427
- -----------------------------------------------------------
Custodian fees 17,286
- -----------------------------------------------------------
Directors' fees 2,725
- -----------------------------------------------------------
Distribution fees-Class A 5,361
- -----------------------------------------------------------
Distribution fees-Class B 3,300
- -----------------------------------------------------------
Distribution fees-Class C 487
- -----------------------------------------------------------
Transfer agent fees-Class A 6,904
- -----------------------------------------------------------
Transfer agent fees-Class B 1,523
- -----------------------------------------------------------
Transfer agent fees-Class C 181
- -----------------------------------------------------------
Registration and filing fees 12,803
- -----------------------------------------------------------
Other 4,375
- -----------------------------------------------------------
Total expenses 106,519
- -----------------------------------------------------------
Less: Fees waived and reimbursed by advisor (64,761)
- -----------------------------------------------------------
Expenses paid indirectly (885)
- -----------------------------------------------------------
Net expenses 40,873
- -----------------------------------------------------------
Net investment income 7,831
- -----------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENT
SECURITIES AND
FOREIGN CURRENCIES:
Net realized gain (loss) from:
Investment securities (71,417)
- -----------------------------------------------------------
Foreign currencies 201
- -----------------------------------------------------------
(71,216)
- -----------------------------------------------------------
Net unrealized appreciation (depreciation)
of:
Investment securities 74,371
- -----------------------------------------------------------
Foreign currencies (286)
- -----------------------------------------------------------
74,085
- -----------------------------------------------------------
Net gain from investment securities and
foreign
currencies 2,869
- -----------------------------------------------------------
Net increase in net assets resulting from
operations $ 10,700
===========================================================
</TABLE>
See Notes to Financial Statements.
7
<PAGE> 10
STATEMENT OF CHANGES IN NET ASSETS
For the period November 3, 1997 (date operations commenced) through April 30,
1998
(Unaudited)
<TABLE>
<CAPTION>
<S> <C>
OPERATIONS:
Net investment income $ 7,831
- ----------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies (71,216)
- ----------------------------------------------------------------------------
Net unrealized appreciation of investment securities and
foreign currencies 74,085
- ----------------------------------------------------------------------------
Net increase in net assets resulting from operations 10,700
- ----------------------------------------------------------------------------
Share transactions-net:
Class A 6,949,021
- ----------------------------------------------------------------------------
Class B 2,195,162
- ----------------------------------------------------------------------------
Class C 429,489
- ----------------------------------------------------------------------------
Net increase in net assets 9,584,372
- ----------------------------------------------------------------------------
NET ASSETS:
Beginning of period --
- ----------------------------------------------------------------------------
End of period $ 9,584,372
============================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $ 9,573,672
- ----------------------------------------------------------------------------
Undistributed net investment income 7,831
- ----------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities and foreign currencies (71,216)
- ----------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 74,085
- ----------------------------------------------------------------------------
$ 9,584,372
============================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
April 30, 1998
(Unaudited)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Asian Growth Fund (the "Fund") is a series portfolio of AIM International
Funds, Inc. (the "Company"). The Company is a Maryland corporation registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end series management investment company consisting of six separate
portfolios: AIM Asian Growth Fund, AIM European Development Fund, AIM Global
Aggressive Growth Fund, AIM Global Growth Fund, AIM Global Income Fund and AIM
International Equity Fund. The Fund commenced operations on November 3, 1997.
The Fund currently offers three different classes of shares: Class A shares,
Class B shares and Class C shares. Class A shares are sold with a front-end
sales charge. Class B shares and Class C shares are sold with a contingent
deferred sales charge. Matters affecting each portfolio or class are voted on
exclusively by the shareholders of such portfolio or class. The assets,
liabilities and operations of each portfolio are accounted for separately.
Information presented in these financial statements pertains only to the Fund.
The Fund's investment objective is to provide long-term growth of capital.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. The
following is a summary of significant accounting policies followed by the Fund
in the preparation of its financial statements.
A. Security Valuations-A security listed or traded on an exchange (except
convertible bonds) is valued at the last sales price on the exchange where
the security is principally traded or, lacking any sales on a particular day,
at the mean between the closing bid and asked prices on that day. If a mean
is not available, as is the case in some foreign markets, the closing bid
will be used absent a last sales price. Securities traded in the over-the-
counter market (but not including securities reported on the NASDAQ National
Market System) are valued at the mean between the last bid and asked prices
based upon quotes furnished by market makers for such securities. Securities
reported on the NASDAQ National Market System are valued at the last sales
price on the valuation date or absent a last sales price, at the mean of the
closing bid and asked prices. Debt obligations (including convertible bonds)
are valued on the basis of prices provided by an independent pricing service.
Prices provided by the pricing service may be determined without exclusive
reliance on quoted prices, and may reflect appropriate factors, such as
yield, type of issue, coupon rate and maturity date. Securities for which
market quotations are either not readily available or are questionable are
valued at fair value as determined in good faith by or under the supervision
of the Company's officers in a manner specifically authorized by the Board of
Directors. Investments with maturities of 60 days
8
<PAGE> 11
or less are valued on the basis of amortized cost which approximates market
value. Generally, 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 asset value of the
Fund's shares are determined as of such times. Foreign currency exchange
rates are also generally determined prior to the close of the New York Stock
Exchange. Occasionally, events affecting the values of such securities and
such exchange rates may occur between the times at which they are determined
and the close of the New York Stock Exchange which would not be reflected in
the computation of the Fund's net asset value. If events materially affecting
the value of such securities occur during such period, then these securities
will be valued at their fair value as determined in good faith by or under
the supervision of the Board of Directors.
B. Foreign Currency Translations--Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollar
amounts at the date of valuation. Purchases and sales of portfolio securities
and income items denominated in foreign currencies are translated into U.S.
dollar amounts on the respective dates of such transactions.
C. Foreign Currency Contracts--A foreign currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a foreign currency contract to attempt to
minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency contract
for the purchase or sale of a security denominated in a foreign currency in
order to "lock in" the U.S. dollar price of that security. The Fund could be
exposed to risk if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
D. Securities Transactions, Investment Income and Distributions--Securities
transactions are accounted for on a trade date basis. Realized gains or
losses are computed on the basis of specific identification of the securities
sold. Interest income is recorded as earned from settlement date and is
recorded on an accrual basis. Dividend income and distributions to
shareholders are recorded on the ex-dividend date.
E. Federal Income Taxes--The Fund intends to comply with the requirements of the
Internal Revenue Code necessary to qualify as a regulated investment company
and, as such, will not be subject to federal income taxes on otherwise
taxable income (including net realized capital gains) which is distributed to
shareholders. Therefore, no provision for federal income taxes is recorded in
the financial statements.
F. Expenses--Distribution and transfer agency expenses directly attributable to
a class of shares are charged to that class' operations. All other expenses
which are attributable to more than one class are allocated among the
classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 0.95% of
the first $500 million of the Fund's average daily net assets, plus 0.90% of the
Fund's average daily net assets in excess of $500 million. Under the terms of a
sub-advisory agreement between AIM and INVESCO Global Asset Management Limited
("IGAM"), AIM pays IGAM a fee at an annual rate of 0.20% of the first $500
million of the Fund's average daily net assets and 0.175% of the Fund's average
daily net assets over $500 million. During the period November 3, 1997 (date
operations commenced) through April 30, 1998, AIM waived advisory fees of $6,761
and reimbursed expenses of $58,000.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the period November 3, 1997 (date
operations commenced) through April 30, 1998, AIM was reimbursed $33,427 for
such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") for certain costs incurred in providing
transfer agency services to the Fund. During the period November 3, 1997 (date
operations commenced) through April 30, 1998, AFS was paid $4,292 for such
services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor of the Class
A, Class B and Class C shares of the Fund. The Company has adopted distribution
plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund's Class
A shares and Class C shares (the "Class A and Class C Plan"), and the Fund's
Class B shares (the "Class B Plan") (collectively, the "Plans"). The Fund,
pursuant to the Class A and Class C Plan, pays AIM Distributors compensation at
the annual rate of 0.35% of the average daily net assets of Class A shares and
1.00% of the average daily net assets of Class C shares. The Fund, pursuant to
the Class B Plan, pays AIM Distributors compensation at an annual rate of 1.00%
of the average daily net assets attributable to the Class B shares. Of these
amounts, the Fund may pay a service fee of 0.25% of the average net assets of
the Class A, Class B or C shares to selected dealers and financial institutions
who furnish continuing personal shareholder services to their customers who
purchase and own the appropriate class of shares of the Fund. Any amounts not
paid as a service fee under the Plans would constitute an asset-based sales
charge. The Plans also impose a cap on the total sales charges, including
asset-based sales charges that may be paid by the respective classes. AIM
Distributors may, from time to time, assign, transfer, or pledge to one or more
designees, its rights to all or a designated portion of (a) compensation
received by AIM Distributors from the Fund pursuant to the Class B Plan (but not
AIM Distributors' duties and obligations pursuant to Class B Plan) and (b) any
contingent deferred sales charges received by AIM Distributors related to the
Class B shares. During the period November 3, 1997 (date operations commenced)
through April 30, 1998, the Class A and Class B and Class C shares paid AIM
Distributors $5,361, $3,300 and $487, respectively, as compensation under the
Plans.
AIM Distributors received commissions of $14,604 from sales of the Class A
shares of the Fund during the period November 3, 1997 (date operations
commenced) through April 30, 1998. Such commissions are not an expense of the
Fund. They are deducted from, and are not included in, the proceeds from sales
of Class A
9
<PAGE> 12
shares. During the period November 3, 1997 (date operations commenced) through
April 30, 1998, AIM Distributors received commissions of $23 in contingent
deferred sales charges imposed on redemptions of Fund shares. Certain officers
and directors of the Company are officers and directors of AIM, AFS and AIM
Distributors.
During the period November 3, 1997 (date operations commenced) through April
30, 1998, the Fund incurred legal fees of $416 for services rendered by the law
firm of Kramer, Levin, Naftalis & Frankel as counsel to the Company's directors.
A member of that firm is a director of the Company.
NOTE 3-INDIRECT EXPENSES
During the period November 3, 1997 (date operations commenced) through April 30,
1998, the Fund received reductions in transfer agency fees from AFS (an
affiliate of AIM) and reductions in custodian fees of $22 and $863,
respectively, under an expense offset arrangement. The effect of the above
arrangements resulted in a reduction of the Fund's total expenses of $885 during
the period November 3, 1997 (date operations commenced) through April 30, 1998.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid or accrued to each director who is
not an "interested person" of AIM. The Company may invest directors' fees, if so
elected by a director, in mutual fund shares in accordance with a deferred
compensation plan.
NOTE 5-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by The Chase Manhattan Bank. The Fund may borrow up to
the lesser of (i) $500,000,000 or (ii) the limits set by its prospectus for
borrowings. The Fund and other funds advised by AIM which are parties to the
line of credit may borrow on a first come, first served basis. Interest on
borrowings under the line of credit is payable on maturity or prepayment date.
During the period November 3, 1997 (date operations commenced) through April 30,
1998, the Fund did not borrow under the line of credit agreement. The funds
which are party to the line of credit are charged a commitment fee of 0.05% on
the unused balance of the committed line. The commitment fee is allocated among
the funds based on their respective average net assets for the period.
Pursuant to an amendment to the line of credit agreement effective May 1,
1998, the Fund may borrow up to the lesser of (i) $1,000,000,000 or (ii) the
limits set by the prospectus for borrowings.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the period November 3, 1997 (date
operations commenced) through April 30, 1998 was $9,548,375 and $1,458,697,
respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
on a tax basis, as of April 30, 1998 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $ 417,873
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (343,502)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $ 74,371
=========================================================
</TABLE>
Costs of investments for tax purposes is $9,294,610.
NOTE 7-CAPITAL STOCK
Changes in the Fund's capital stock outstanding during the period November 3,
1997 (date operations commenced) through April 30, 1998 were as follows:
<TABLE>
<CAPTION>
APRIL 30,
1998
---------------------------
SHARES AMOUNT
------------ -----------
<S> <C> <C>
Sold:
Class A 891,519 $ 8,208,769
- ------------------------------------------------------------------
Class B 239,811 2,212,712
- ------------------------------------------------------------------
Class C 78,755 737,047
- ------------------------------------------------------------------
Reacquired:
Class A (135,312) (1,259,748)
- ------------------------------------------------------------------
Class B (1,850) (17,550)
- ------------------------------------------------------------------
Class C (32,493) (307,558)
- ------------------------------------------------------------------
1,040,430 $ 9,573,672
==================================================================
</TABLE>
10
<PAGE> 13
NOTE 8-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A, Class B and
Class C capital stock outstanding during the period November 3, 1997 (date
operations commenced) through April 30, 1998.
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
----------- ----------- -----------
<S> <C> <C> <C>
Net asset value, beginning of period $ 10.00 $ 10.00 $ 10.00
- ------------------------------------------------------------ ----------- ----------- -----------
Income from investment operations:
Net investment income 0.01 -- --
- ------------------------------------------------------------ ----------- ----------- -----------
Net gains (losses) on securities (both realized and
unrealized) (0.79) (0.80) (0.80)
- ------------------------------------------------------------ ----------- ----------- -----------
Total from investment operations (0.78) (0.80) (0.80)
- ------------------------------------------------------------ ----------- ----------- -----------
Net asset value, end of period $ 9.22 $ 9.20 $ 9.20
============================================================ =========== =========== ===========
Total return(a) (7.80)% (8.00)% (8.00)%
============================================================ =========== =========== ===========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $ 6,970 $ 2,189 $ 425
============================================================ =========== =========== ===========
Ratio of expenses to average net assets(b)(c)(d) 2.05% 2.72% 2.72%
============================================================ =========== =========== ===========
Ratio of net investment income (loss) to average net
assets(c)(e) 0.50% (0.17)% (0.17)%
============================================================ =========== =========== ===========
Portfolio turnover rate 42% 42% 42%
============================================================ =========== =========== ===========
Average brokerage commission rate(f) $ 0.0031 $ 0.0031 $ 0.0031
============================================================ =========== =========== ===========
</TABLE>
(a) Does not deduct sales charges and are not annualized for periods less than
one year.
(b) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
5.44% (annualized), 6.11% (annualized) and 6.11% (annualized) for Class A,
Class B and Class C, respectively.
(c) Ratios are annualized and based on average net assets of $3,140,474,
$676,731 and $99,879 for Class A, Class B and Class C, respectively.
(d) Ratios include indirectly paid expenses. Excluding indirectly paid expenses,
the ratios of expenses to net assets would have been 2.01% (annualized),
2.67% (annualized) and 2.67% (annualized) for Class A, Class B and Class C,
respectively.
(e) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (2.89)% (annualized), (3.56) % (annualized) and (3.56)%
(annualized), for Class A, Class B and Class C, respectively.
(f) The average commission rate paid is the total brokerage commissions paid on
a applicable purchases and sales of securities for the period divided by
the total number of related shares purchased and sold.
11
<PAGE> 14
Directors & Officers
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; John J. Arthur A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Treasurer 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Carol F. Relihan Houston, TX 77046
Senior Vice President and Secretary
Owen Daly II SUB-ADVISOR
Director Gary T. Crum
Cortland Trust Inc. Senior Vice President INVESCO Global Asset Management Limited
Cedar House
Edward K. Dunn Jr. Dana R. Sutton 41 Cedar Avenue
Chairman, Mercantile Mortgage Corp.; Vice President and Assistant Treasurer Hamilton, HM12 Bermuda
Formerly Vice Chairman and President,
Mercantile-Safe Deposit & Trust Co.; and Robert G. Alley TRANSFER AGENT
President, Mercantile Bankshares Vice President
A I M Fund Services, Inc.
Jack Fields Melville B. Cox P.O. Box 4739
Chief Executive Officer Vice President Houston, TX 77210-4739
Texana Global, Inc.;
Formerly Member Jonathan C. Schoolar CUSTODIAN
of the U.S. House of Representatives Vice President
State Street Bank and Trust Company
Carl Frischling Renee A. Bamford 225 Franklin Street
Partner Assistant Secretary Boston MA 02110
Kramer, Levin, Naftalis & Frankel
P. Michelle Grace COUNSEL TO THE FUND
Robert H. Graham Assistant Secretary
President and Chief Executive Officer Ballard Spahr
A I M Management Group Inc. Jeffrey H. Kupor Andrews & Ingersoll, LLP
Assistant Secretary 1735 Market Street
John F. Kroeger Philadelphia, PA 19103
Formerly Consultant Nancy L. Martin
Wendell & Stockel Associates, Inc. Assistant Secretary COUNSEL TO THE DIRECTORS
Lewis F. Pennock Ofelia M. Mayo Kramer, Levin, Naftalis & Frankel
Attorney Assistant Secretary 919 Third Avenue
New York, NY 10022
Ian W. Robinson Lisa A. Moss
Consultant; Formerly Executive Assistant Secretary DISTRIBUTOR
Vice President and
Chief Financial Officer Kathleen J. Pflueger A I M Distributors, Inc.
Bell Atlantic Management Assistant Secretary 11 Greenway Plaza
Services, Inc. Suite 100
Samuel D. Sirko Houston, TX 77046
Louis S. Sklar Assistant Secretary
Executive Vice President
Hines Interests Stephen I. Winer
Limited Partnership Assistant Secretary
Mary J. Benson
Assistant Treasurer
</TABLE>
12
<PAGE> 15
HOW AIM MAKES INVESTING
EASY FOR YOU
o LOW INITIAL INVESTMENT. You can get your investment program started for as
little as $500. Subsequent investments can be made for only $50.
o AUTOMATIC REINVESTMENT OF DIVIDENDS AND/OR CAPITAL GAINS. Distributions may
be received in cash or reinvested in the Fund free of charge. Over time, the
power of compounding can significantly increase the value of your assets.
o AUTOMATIC INVESTMENT PLAN. You may build your investment by regularly
purchasing additional shares. Pre-authorized checks for $50 or more can be
drafted monthly from your personal checking account.
o EASY ACCESS TO YOUR MONEY. Your shares may be redeemed at net asset value
any day the New York Stock Exchange is open. The price of shares sold may be
more or less than their original cost, depending on market conditions.
o SYSTEMATIC WITHDRAWAL PLAN. You may elect to receive checks of at least $50
monthly or quarterly through a systematic withdrawal plan.
o EXCHANGE PRIVILEGE. As your goals change, you may exchange all or part of
your assets for those of other funds within the same share class of The AIM
Family of Funds--Registered Trademark--. The exchange privilege may be
modified or discontinued for any of the AIM funds. Certain restrictions
apply.
o RETIREMENT PLANS. You may purchase shares of the fund for your Individual
Retirement Account (IRA) or any other type of retirement plan, and earn
tax-deferred dollars for your retirement.
o TOLL-FREE ACCESS. Current shareholders can call our AIM Investor Line at
800-246-5463 for 24-hour-a-day account information. Or, of course, you may
contact your financial consultant for assistance.
o WWW.AIMFUNDS.COM. As a current shareholder, you can check account balances
24 hours a day over the Internet. State-of-the-art encryption lets you send
us questions that include confidential information without the fear of
eavesdropping, tampering, or forgery.
--------------------
Current shareholders
can call our
AIM Investor Line at
800-246-5463
for 24-hour-a-day
account information.
--------------------
<PAGE> 16
<TABLE>
<S> <C>
THE AIM FAMILY OF FUNDS--Registered Trademark--
FOR AGGRESSIVE GROWTH
AIM Aggressive Growth Fund*
AIM Asian Growth Fund
AIM Capital Development Fund
AIM Constellation Fund
AIM European Development Fund
AIM Global Aggressive Growth Fund
[PHOTO OF ELEVEN FOR GROWTH OF CAPITAL
GREENWAY PLAZA AIM Advisor International Value Fund
APPEARS HERE] AIM Blue Chip Fund
AIM Global Growth Fund
AIM International Equity Fund
AIM Select Growth Fund**
AIM Value Fund
AIM Weingarten Fund
FOR GROWTH AND INCOME OR INCOME WITH CAPITAL GROWTH
AIM Advisor Flex Fund
AIM Advisor Large Cap Value Fund
AIM Advisor MultiFlex Fund
AIM Advisor Real Estate Fund
AIM Balanced Fund
AIM Charter Fund
AIM Global Utilities Fund
FOR HIGH CURRENT INCOME OR CURRENT INCOME
AIM High Yield Fund
AIM Global Income Fund
AIM Income Fund
FOR CURRENT TAX-FREE INCOME
AIM High Income Municipal Fund
AIM Municipal Bond Fund
AIM Tax-Exempt Bond Fund of Connecticut
AIM Tax-Free Intermediate Fund
FOR CURRENT INCOME AND HIGH DEGREE OF SAFETY
AIM Intermediate Government Fund
AIM Limited Maturity Treasury Fund
AIM Money Market Fund
AIM Tax-Exempt Cash Fund
A I M Management Group Inc. has provided *AIM Aggressive Growth Fund was closed
leadership in the mutual fund industry since 1976 to new investors on June 5, 1997. ** On
and managed approximately $89 billion in assets May 1, 1998, AIM Growth Fund was renamed
for more than 4.4 million shareholders, including AIM Select Growth Fund. For more
individual investors, corporate clients, and complete information about any AIM
financial institutions, as of March 31, 1998. The Fund(s), including sales charges and
AIM Family of Funds--Registered Trademark-- is expenses, ask your financial consultant
distributed nationwide, and AIM today ranks among or securities dealer for a free
the nation's top 15 mutual fund companies in prospectus(es). Please read the
assets under management, according to Lipper prospectus(es) carefully before you
Analytical Services, Inc. invest or send money.
</TABLE>
Invest with DISCIPLINE-SM-
