<PAGE> 1
AIM GLOBAL AGGRESSIVE
GROWTH FUND
[AIM LOGO APPEARS HERE] ANNUAL REPORT OCTOBER 31, 1997
<PAGE> 2
-------------------------------------
AIM GLOBAL AGGRESSIVE GROWTH FUND
For shareholders who seek long-
term growth of capital.
The Fund invests in a portfolio
of global equity securities
of small capitalization companies
with above-average
earnings momentum.
-------------------------------------
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Global Aggressive 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 4.75% sales charge, and Class B 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 performance of the Fund's Class B shares and C shares will differ
from that of Class A shares due to differences in sales charge structure and
Fund expenses.
o Class C shares commenced sales on August 4, 1997.
o Performance figures for Class A and Class B shares are historical and
reflect reinvestment of all distributions and changes in net asset value.
Unless otherwise indicated, the Fund's performance is computed at net asset
value without a sales charge.
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 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.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The Morgan Stanley Capital International World Index is a group of unmanaged
global securities tracked by Morgan Stanley Capital International.
o Standard & Poor's Corporation (S&P) is a credit-rating agency. The Standard
& Poor's Composite Index of 500 Stocks (S&P 500) is a group of unmanaged
securities widely regarded by investors to be representative of the stock
market in general. Results shown assume the reinvestment of dividends.
o Lipper Analytical Services, Inc., is an independent mutual fund performance
monitor. The unmanaged Lipper International Fund Index represents an average
of the performance of the 30 largest international mutual funds.
o The Dow Jones Industrial Average is a price-weighted average of 30 actively
traded primarily industrial stocks.
o The Europe, Australia, and Far East Index (EAFE) is a group of unmanaged
foreign securities tracked by Morgan Stanley Capital International.
o The NASDAQ (National Association of Securities Dealers Automated Quotation
system) Composite Index is a group of more than 4,500 unmanaged
over-the-counter securities widely regarded by investors to be
representative of the small- and medium-sized company stock universe.
o An investment cannot be made in the indexes 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
Dear Fellow Shareholder:
The fiscal year ended October 31 experienced no let-up in the
[PHOTO OF volatility in equity markets, and it closed on an unsettling
Charles T. note. In late October, in the wake of a currency crisis in
Bauer, Southeast Asia, the stock market experienced its first 10%
Chairman of correction since 1991. On Monday, October 27, the New York
the Board of Stock Exchange closed to deal with market volatility for the
THE FUND first time in its history when the Dow Jones Industrial
APPEARS HERE] Average fell 554 points, the index's largest point decline
ever. It is important to note that in percentage terms, this
was a drop of 7.18%, far smaller than the 22.61% decline that
occurred October 19, 1987. Fortunately, this time the market
snapped back, and the Dow regained 337 points the next day.
As of this writing, markets continue to recover.
Many investment managers, including AIM, had cautioned
that a correction was inevitable, that the relentless rise in
benchmarks like the Dow could not continue. In less than 12
months, the Dow had climbed from 6010 on October 14, 1996, to
reach its all-time high of 8259 on August 6, 1997.
When markets become overvalued, no one knows what will precipitate a
decline. No one foresaw that a currency devaluation by Thailand beginning during
the summer would lead to worldwide stock market turmoil.
Despite recent activities, the fiscal year ended October 31 brought domestic
equity investors excellent returns: The Dow was up almost 26%; the broader S&P
500, more than 32%; the NASDAQ small-cap index, 30.46%. International
investments, while positive, weren't as robust; the EAFE Index rose 4.63%. On
the following pages, your Fund managers discuss how your Fund performed in this
market context and their outlook for the future.
REALISTIC EXPECTATIONS
The 1100-point decline in the Dow between early August and late October was the
latest in a series of market breaks. Between mid-March and mid-April of this
year, for example, the Dow dropped almost 10%.
Many investors, including professional fund managers, have become accustomed
to buying on these market breaks because the market has bounced back quickly.
From its 1997 low of 6391 on April 11, the Dow took less than four months to
rise almost 2000 points to its all-time high.
However, this time could be different. Many investors have developed two
unrealistic expectations: first, a belief that stocks can rise more than 20% a
year indefinitely; and second, confidence that the market always rebounds
swiftly from a decline.
Neither notion is historically correct. History tells us that over the long
term, average annual total return for stocks is about 10%, not 20%. And those of
us who have been in this business for many years remember the bear market of the
1970s, when the market experienced a series of declines and recovery was very
slow.
Nevertheless, there is reason for optimism, including sound fiscal policy
steadily shrinking the federal deficit, stable interest rates, and a strong
economy unharmed by inflation. Despite recent events in Asia, it is difficult to
be pessimistic about the U.S. economy and, indeed, about most of the developed
economies in the world.
We are pleased to send you this report on your Fund. Please contact our
Client Services department at 800-959-4246 if you have any questions or
comments. Don't forget that automated information about your AIM account is
available 24 hours a day on the AIM Investor Line, 800-246-5463. Or visit our
Web site, at www.aimfunds.com.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
-----------------------------------
Despite recent activities,
the fiscal year
ended October 31
brought domestic equity investors
excellent returns.
-----------------------------------
<PAGE> 4
The Managers' Overview
EUROPEAN AND LATIN AMERICAN GROWTH RETURNS OFFSET "ASIAN FLU"
A roundtable discussion with the Fund management team for AIM Global Aggressive
Growth Fund for the fiscal year ended October 31, 1997.
- --------------------------------------------------------------------------------
Q. WORLD EQUITY MARKETS HAD A VOLATILE YEAR. HOW DID THE FUND PERFORM DURING
THE REPORTING PERIOD?
A. The Fund's total return was 9.65% for Class A shares and 9.11% for Class B
shares for the fiscal year ended October 31, 1997 (Class C shares commenced
sales on August 4, 1997). Comparatively, the Morgan Stanley Capital
International (MSCI) World Index of global stocks gained 16.77% during the
reporting period. It is important to note that the MSCI World Index tracks
the performance of global large-company stocks and not global small-company
stocks in which your Fund invests. There is no true MSCI benchmark for
global small-company equity performance. The Fund's net assets grew $763
million to $2.49 billion at the end of the reporting period.
Q. WHAT WERE SOME OF THE MAJOR INFLUENCES ON THE FUND'S PORTFOLIO OVER THE PAST
12 MONTHS?
A. In the United States, the reporting period was "a tale of two markets."
During the first six months of the fiscal year ended April 30, 1997,
large-company stocks were the undisputed market kings as the Standard and
Poor's Composite Index of 500 Stocks (S&P 500) rose 14.75% compared to a
1.61% rise for the Russell 2000 Index, which tracks small-cap stocks.
However, from May 1 until October 31, 1997, small-caps greatly outperformed
large-cap stocks, as evidenced by the Russell 2000's 27.29% total return
over this period vs. the S&P 500's 15.13% return. This reversal bode well
for the domestic small-cap holdings in the portfolio.
At the end of the reporting period, though, just 32% of the Fund was in
domestic equities, which meant the remaining 68% of the Fund was invested
around the world and exposed to some very volatile markets, especially in
Southeast Asia.
We continue to see more of a global economy every year. Around the world
inflation was relatively tame and interest rates remained low, an attractive
combination during the past year which provided an excellent economic
environment for equities. However, global market volatility caused investors
to favor the perceived safety of large-cap stocks as opposed to small-cap
stocks around the world.
Q. HOW DID THE GLOBAL MARKETS PERFORM DURING THE REPORTING PERIOD?
A. European markets had an outstanding year. Six of the 10 best-performing
markets in the world during the reporting period were in Europe. Latin
America also posted solid performance during the fiscal year, although its
returns were tempered by global market volatility in the final week of the
reporting period.
Unfortunately, the same cannot be said for the Far East. Japan and the
Asian Tigers had a very difficult time during the reporting period: Thailand
was off 68%, the Philippines off 52%, Japan down 18%, and Hong Kong fell
17%. The poor market performance in the Far East had an adverse affect on
the Fund.
Q. WHAT CAUSED THE EXCELLENT MARKET RETURNS IN EUROPE?
A. There were two major factors at work in the European markets. The first was
the ongoing economic restructuring, which we have talked about for quite
some time. But during the fiscal year we saw the economic returns caused by
the restructuring gain considerable momentum. Europe remains an area with
fairly cheap valuations, especially when compared to the United States. More
importantly, earnings growth in Europe also continued to be strong.
The second major stimulus on European markets was the introduction of
real investing for the first time to European households. Europeans are
becoming more
================================================================================
FUND CELEBRATES THIRD ANNIVERSARY WITH 5 STARS
*****On September 15, 1997, AIM Global Aggressive Growth Fund celebrated its
third anniversary by receiving a five-star rating for its overall performance
from Morningstar*. The Fund also received five stars for its three- year
performance.
*Morningstar proprietary ratings reflect risk-adjusted performance through
October 31, 1997. The ratings are subject to change every month. Ratings are
calculated from the funds' three-, five-, and 10-year returns (with fee
adjustments) in excess of 90-day Treasury bill returns, and a risk factor that
reflects performance below 90-day T-bills. The top 10% of the funds in a rating
category receive five stars, the next 22.5% receive four stars, the middle 35%
receive three stars, the next 22.5% receive two stars, and the bottom 10%
receive one star.
---------------------------------------
Around the world
inflation was relatively tame and
interest rates remained low,
an attractive combination for equities.
---------------------------------------
See important Fund & index disclosures inside front cover.
2
<PAGE> 5
The Managers' Overview
PORTFOLIO COMPOSITION
As of October 31, 1997, based on net assets
<TABLE>
<CAPTION>
================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 COUNTRIES
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Fomento Economico Mexicano, S.A. de C.V.-Class B (Mexico) 0.81% 1. United States 32.28%
2. Panamerican Beverages, Inc.-Class A (Mexico) 0.72 2. United Kingdom 7.55
3. Geac Computer Corporation Ltd.(Canada) 0.70 3. Canada 6.45
4. Airtours PLC (UK) 0.65 4. Hong Kong 5.05
5. Coca-Cola Femsa S.A. (Mexico) 0.63 5. Mexico 4.62
6. Hutchison Whampoa Ltd. (Hong Kong) 0.63 6. Netherlands 4.43
7. YPF S.A. (Argentina) 0.62 7. Brazil 3.94
8. China Resources Enterprise Ltd.(Hong Kong) 0.60 8. Japan 2.78
9. Johnson Electric Holdings Ltd. (Hong Kong) 0.54 9. Israel 2.60
10.Grupo Televisa S.A. (Mexico) 0.53 10.Norway 2.56
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>
educated about the advantages of investing in their stock markets, and we
think demand for European equities will continue to grow.
Q. WHAT CAUSED THE ECONOMIC TURBULENCE IN THE PACIFIC RIM?
A. Simply put, the emerging markets in countries like Thailand, Malaysia,
Indonesia, and the Philippines grew too quickly for their size. New
construction of office buildings and factories far outstripped demand, and
the debt used to finance the construction burgeoned. When cash flow became a
problem, the markets in the region went into a tailspin. The markets in
these countries are very small, and it doesn't take much to move those
markets either up or down.
The first warning sign came when Thailand devalued its currency in July.
Everything came to a head on October 23 when the Hong Kong market plunged
10.4%. The so-called "Asian Flu"--which was how market analysts termed the
economic turmoil in the Far East--caused severe drops all over the world
during the last five days of the reporting period, including the 554-point
drop in the Dow Jones Industrial Average and a 6.14% fall in the Russell
2000 Index on October 27.
Q. HOW DID THE TURMOIL IN THOSE MARKETS AFFECT THE FUND?
A. Fortunately, we had lowered the portfolio's weightings in Asia prior to
October's troubles. Our earnings discipline was very helpful in our exit
from those markets in the Pacific Rim. The earnings in most of the companies
in that region were on a downward trend prior to the October market drop,
and our discipline dictated that it was time to sell those holdings. By the
end of the holding period only 5% of the Fund's portfolio was invested in
Hong Kong and just over 2% was invested in Japan.
However, we did remain invested in such Hong Kong companies as Johnson
Electric Holdings Ltd., an electrical equipment company, China Resource
Enterprises, a diversified manufacturing company, and Hutchison Whampoa, a
retail food chain. These three companies' earnings were attractive enough
that they were part of the Fund's top 10 holdings.
Q. WHAT WAS THE ECONOMIC SITUATION IN JAPAN?
A. Unfortunately, the second-largest economy in the world was still in a major
recession during the reporting period. Japan also was affected by the "Asian
Flu" because a number of Japanese banks had investments and outstanding
loans to their Asian neighbors. However, because of the size and maturity of
the Japanese market, many Japanese companies are global, rather than
regional, players.
Q. YOU MENTIONED THAT YOU HAVE REDUCED THE FUND'S EXPOSURE IN THE FAR EAST.
WHERE HAVE YOU PUT THAT MONEY TO WORK?
A. The portfolio's holdings in Latin America increased dramatically so that
12.54% of the Fund was invested there at the end of the reporting period. In
U.S. dollars Brazil was up over 18%, Colombia up 45%, and Mexico up 37%
during the reporting period. The Mexican market and economy continue to
progress quite nicely, and we've been increasing the portfolio's weighting
there in companies such Coca-Cola FEMSA, a beverage distributing company
that was among the Fund's top 10 holdings. We also raised the Fund's
holdings of European securities as we reduced our holdings in Asia.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND IN THE NEAR TERM?
A. Conditions worldwide remain very good for equities, although it is
unrealistic to expect continued equity returns of 20% or more. We are
optimistic about domestic small-cap stocks because of their lower valuations
in comparison to domestic large-cap stocks, and we also believe smaller
companies possess greater earnings potential than their larger counterparts.
Globally, we are still very positive on Europe, and very hesitant on the
Pacific Rim. Things may continue to worsen in Asia before those markets
experience a recovery, so we do not anticipate our Asian weightings
increasing any time soon. In Europe, though, we believe there will be faster
earnings growth with better valuations than in the U.S., because Europe's
cash-to-price earnings, price-to-book, price-to-dividend, and P/E ratios are
all lower than in the U.S. The economic outlook in Latin America seems
positive as well.
It is important to remember that what happened in October in Asia should
have little bearing on U.S. markets. The economic indicators in the U.S.
remain positive, and that is good for markets around the world because they
often take their lead from the U.S. As long as we continue to see the
combination of low inflation and low interest rates around the globe, the
short-term outlook for global equities will remain promising.
See important fund and index disclosures inside front cover.
3
<PAGE> 6
Long-Term Performance
AIM Global Aggressive Growth Fund vs. Benchmark Index
The chart below compares your Fund to a benchmark index. It is intended to give
you a general idea of how your Fund performed compared to the stock market over
the period since inception, 9/15/94 to 10/31/97. It is important to understand
the difference between your Fund and an index. An index measures the performance
of a hypothetical portfolio, in this case the Morgan Stanley Capital
International World Index. Unlike your Fund, an index is not managed; therefore
there are no sales charges, expenses, or fees. You cannot invest in an index.
But if you could buy all the securities that make up a particular index, you
would incur expenses that would affect the return on your investment.
GROWTH OF A $10,000 INVESTMENT
9/15/94-10/31/97
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AIM GLOBAL AGRESSIVE AIM GLOBAL AGRESSIVE MSCI WORLD
GROWTH FUND, CLASS A GROWTH FUND, CLASS B INDEX
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
9/15/94 $ 9,524 $10,000 $10,000
11/94 9,505 9,970 9,585
2/95 9,590 10,050 9,677
5/95 10,676 11,170 10,593
8/95 12,352 12,910 10,878
11/95 12,524 13,070 11,407
2/96 13,505 14,080 12,033
5/96 15,369 15,997 12,538
8/96 14,738 15,315 12,303
11/96 15,503 16,098 13,602
2/97 15,598 16,168 13,708
4/97 16,315 16,891 14,741
8/97 17,099 17,673 15,112
10/97 16,516 17,061 15,100
</TABLE>
Past performance is no guarantee of comparable future results.
================================================================================
AVERAGE ANNUAL TOTAL RETURN
As of 10/31/97. Including sales charges.
CLASS A SHARES
Inception (9/15/94) 17.41%
3 Years 17.35
1 Year 4.41
CLASS B SHARES
Inception (9/15/94) 17.97%
3 Years 17.95
1 Year 4.11
CLASS C SHARES
Inception (8/4/97) -8.48%
================================================================================
Your Fund's total return includes sales charges, expenses, and management fees.
For Fund performance calculations and descriptions of indexes cited on this
page, please refer to the inside front cover. Results for MSCI World Index are
for the period 8/30/94 to 10/31/97. Source: Towers Data Systems HYPO--Registered
Trademark--.
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
October 31, 1997
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
DOMESTIC COMMON STOCKS-31.90%
AEROSPACE/DEFENSE-0.27%
BE Aerospace, Inc.(a) 137,500 $ 3,867,188
- ---------------------------------------------------------------
Precision Castparts Corp. 50,000 2,940,625
- ---------------------------------------------------------------
6,807,813
- ---------------------------------------------------------------
AUTO PARTS & EQUIPMENT-0.02%
Borg-Warner Automotive, Inc. 8,000 436,000
- ---------------------------------------------------------------
BANKS (REGIONAL)-0.30%
Bank United Corp.-Class A 150,000 6,300,000
- ---------------------------------------------------------------
First Savings Bank of Washington
Bancorp, Inc. 50,000 1,187,500
- ---------------------------------------------------------------
7,487,500
- ---------------------------------------------------------------
BIOTECHNOLOGY-0.09%
Curative Health Services, Inc.(a) 75,000 2,259,375
- ---------------------------------------------------------------
BROADCASTING (TELEVISION, RADIO & CABLE)-0.46%
Heftel Broadcasting Corp.(a) 130,000 8,645,000
- ---------------------------------------------------------------
Jacor Communications, Inc.(a) 65,500 2,742,812
- ---------------------------------------------------------------
11,387,812
- ---------------------------------------------------------------
COMMUNICATIONS EQUIPMENT-1.36%
ADC Telecommunications, Inc.(a) 130,000 4,306,250
- ---------------------------------------------------------------
Brightpoint, Inc.(a) 218,750 7,218,750
- ---------------------------------------------------------------
Coherent Communications Systems
Corp.(a) 179,500 5,429,875
- ---------------------------------------------------------------
MasTec, Inc.(a) 200,000 6,487,500
- ---------------------------------------------------------------
P-COM, Inc.(a) 200,000 4,025,000
- ---------------------------------------------------------------
REMEC, Inc.(a) 75,000 1,903,125
- ---------------------------------------------------------------
Tellabs, Inc.(a) 84,800 4,579,200
- ---------------------------------------------------------------
33,949,700
- ---------------------------------------------------------------
COMPUTERS (HARDWARE)-0.53%
Concord EFS, Inc.(a) 199,737 5,929,692
- ---------------------------------------------------------------
Dell Computer Corp.(a) 50,000 4,006,250
- ---------------------------------------------------------------
IDX Systems Corp.(a) 100,000 3,375,000
- ---------------------------------------------------------------
13,310,942
- ---------------------------------------------------------------
COMPUTERS (NETWORKING)-0.23%
International Network Services(a) 100,000 2,200,000
- ---------------------------------------------------------------
Premiere Technologies, Inc.(a) 100,000 3,400,000
- ---------------------------------------------------------------
5,600,000
- ---------------------------------------------------------------
COMPUTERS (PERIPHERALS)-0.10%
Network Appliance, Inc.(a) 50,000 2,512,500
- ---------------------------------------------------------------
COMPUTERS (SOFTWARE &
SERVICES)-2.18%
Advanced Fibre Communications,
Inc.(a) 200,000 5,812,500
- ---------------------------------------------------------------
MARKET
SHARES VALUE
COMPUTERS (SOFTWARE & SERVICES)-(CONTINUED)
Analysts International Corp. 81,000 $ 3,655,125
- ---------------------------------------------------------------
Computer Task Group, Inc. 107,400 3,034,050
- ---------------------------------------------------------------
Electronic Arts, Inc.(a) 77,200 2,615,150
- ---------------------------------------------------------------
Engineering Animation, Inc.(a) 126,800 5,595,050
- ---------------------------------------------------------------
HBO & Co. 111,800 4,863,300
- ---------------------------------------------------------------
JDA Software Group, Inc.(a) 50,000 1,562,500
- ---------------------------------------------------------------
NOVA Corp.(a) 150,000 4,031,250
- ---------------------------------------------------------------
Security Dynamics Technologies,
Inc.(a) 125,000 4,234,375
- ---------------------------------------------------------------
Simulation Sciences, Inc.(a) 300,000 5,475,000
- ---------------------------------------------------------------
Sterling Commerce, Inc.(a) 104,200 3,458,139
- ---------------------------------------------------------------
Veritas Software Corp.(a) 112,500 4,682,813
- ---------------------------------------------------------------
Viasoft, Inc.(a) 54,100 2,218,100
- ---------------------------------------------------------------
Whittman-Hart, Inc.(a) 21,600 626,400
- ---------------------------------------------------------------
Wind River Systems(a) 60,750 2,331,282
- ---------------------------------------------------------------
54,195,034
- ---------------------------------------------------------------
CONSUMER (JEWELRY, NOVELTIES & GIFTS)-0.33%
Action Performance Companies,
Inc.(a) 100,000 2,562,500
- ---------------------------------------------------------------
Blyth Industries, Inc.(a) 222,800 5,542,150
- ---------------------------------------------------------------
8,104,650
- ---------------------------------------------------------------
CONSUMER FINANCE-0.87%
AmeriCredit Corp.(a) 100,000 2,906,250
- ---------------------------------------------------------------
Delta Financial Corp.(a) 43,300 790,225
- ---------------------------------------------------------------
FIRSTPLUS Financial Group,
Inc.(a) 150,100 8,255,500
- ---------------------------------------------------------------
IMC Mortgage Co.(a) 200,000 3,475,000
- ---------------------------------------------------------------
Money Store, Inc. (The) 100,000 2,837,500
- ---------------------------------------------------------------
SLM Holding Corp. 25,000 3,509,375
- ---------------------------------------------------------------
21,773,850
- ---------------------------------------------------------------
DISTRIBUTORS (FOOD &
HEALTH)-0.12%
Patterson Dental Co.(a) 76,900 3,076,000
- ---------------------------------------------------------------
ELECTRICAL EQUIPMENT-1.25%
Berg Electronics Corp.(a) 152,800 3,571,700
- ---------------------------------------------------------------
HADCO Corp.(a) 60,000 3,322,500
- ---------------------------------------------------------------
Kemet Corp.(a) 100,000 2,175,000
- ---------------------------------------------------------------
Sanmina Corp.(a) 111,000 8,297,250
- ---------------------------------------------------------------
Sawtek Inc.(a) 150,000 5,100,000
- ---------------------------------------------------------------
SCI Systems, Inc.(a) 150,000 6,600,000
- ---------------------------------------------------------------
Solectron Corp.(a) 51,000 2,001,750
- ---------------------------------------------------------------
31,068,200
- ---------------------------------------------------------------
ELECTRONICS (COMPONENT DISTRIBUTORS)-0.43%
Benchmarq Microelectronics,
Inc.(a) 250,000 5,187,500
- ---------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
ELECTRONICS (COMPONENT
DISTRIBUTORS)-(CONTINUED)
Computer Products, Inc.(a) 200,000 $ 5,450,000
- ---------------------------------------------------------------
10,637,500
- ---------------------------------------------------------------
ELECTRONICS
(INSTRUMENTATION)-0.55%
CellStar Corp.(a) 275,000 9,332,812
- ---------------------------------------------------------------
Perkin-Elmer Corp. 55,500 3,468,750
- ---------------------------------------------------------------
ThermoQuest Corp.(a) 45,000 804,375
- ---------------------------------------------------------------
13,605,937
- ---------------------------------------------------------------
ELECTRONICS
(SEMICONDUCTORS)-2.17%
Alliance Semiconductor Corp.(a) 150,000 1,125,000
- ---------------------------------------------------------------
Altera Corp.(a) 75,000 3,328,125
- ---------------------------------------------------------------
ANADIGICS, Inc.(a) 100,000 3,700,000
- ---------------------------------------------------------------
Burr-Brown Corp.(a) 115,400 3,490,850
- ---------------------------------------------------------------
Cypress Semiconductor Corp.(a) 270,000 3,037,500
- ---------------------------------------------------------------
Dallas Semiconductor Corp. 100,000 4,887,500
- ---------------------------------------------------------------
Integrated Device Technology,
Inc.(a) 300,000 3,468,750
- ---------------------------------------------------------------
Lattice Semiconductor Corp.(a) 55,100 2,758,444
- ---------------------------------------------------------------
Linear Technology Corp. 91,000 5,721,625
- ---------------------------------------------------------------
Micrel, Inc.(a) 100,000 3,587,500
- ---------------------------------------------------------------
National Semiconductor Corp.(a) 130,000 4,680,000
- ---------------------------------------------------------------
PMC-Sierra, Inc.(a) 100,000 2,637,500
- ---------------------------------------------------------------
Sipex Corp.(a) 300,000 9,862,500
- ---------------------------------------------------------------
Vitesse Semiconductor Corp.(a) 37,500 1,626,562
- ---------------------------------------------------------------
53,911,856
- ---------------------------------------------------------------
ENTERTAINMENT-0.09%
Regal Cinemas, Inc.(a) 100,000 2,300,000
- ---------------------------------------------------------------
EQUIPMENT (SEMICONDUCTORS)-1.15%
BMC Industries, Inc. 110,000 3,540,625
- ---------------------------------------------------------------
Credence Systems Corp.(a) 100,000 2,950,000
- ---------------------------------------------------------------
DuPont Photomasks, Inc.(a) 100,000 4,300,000
- ---------------------------------------------------------------
Electroglas, Inc.(a) 200,000 3,800,000
- ---------------------------------------------------------------
Photronics, Inc.(a) 125,000 5,359,375
- ---------------------------------------------------------------
Silicon Valley Group, Inc.(a) 175,000 5,031,250
- ---------------------------------------------------------------
Teradyne, Inc.(a) 100,000 3,743,750
- ---------------------------------------------------------------
28,725,000
- ---------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-0.28%
Amresco, Inc.(a) 100,000 3,137,500
- ---------------------------------------------------------------
SunAmerica, Inc. 105,000 3,773,438
- ---------------------------------------------------------------
6,910,938
- ---------------------------------------------------------------
FOOTWEAR-0.05%
Wolverine World Wide, Inc. 59,925 1,318,350
- ---------------------------------------------------------------
HEALTH CARE (DRUGS-GENERIC & OTHER)-0.40%
Dura Pharmaceuticals, Inc.(a) 57,900 2,800,912
- ---------------------------------------------------------------
MARKET
SHARES VALUE
HEALTH CARE (DRUGS-GENERIC &
OTHER)-(CONTINUED)
Medicis Pharmaceutical Corp.(a) 150,000 $ 7,218,750
- ---------------------------------------------------------------
10,019,662
- ---------------------------------------------------------------
HEALTH CARE (HOSPITAL MANAGEMENT)-0.58%
Health Management Associates,
Inc.-Class A(a) 335,700 8,182,688
- ---------------------------------------------------------------
Tenet Healthcare Corp.(a) 75,000 2,292,187
- ---------------------------------------------------------------
Universal Health Services,
Inc.-Class B(a) 89,800 3,956,812
- ---------------------------------------------------------------
14,431,687
- ---------------------------------------------------------------
HEALTH CARE (LONG TERM
CARE)-0.25%
HEALTHSOUTH Corp.(a) 150,000 3,834,375
- ---------------------------------------------------------------
Sunrise Assisted Living, Inc.(a) 63,200 2,346,300
- ---------------------------------------------------------------
6,180,675
- ---------------------------------------------------------------
HEALTH CARE (MANAGED CARE)-0.45%
Concentra Managed Care, Inc.(a) 99,115 3,233,627
- ---------------------------------------------------------------
Express Scripts, Inc.-Class A(a) 40,000 2,255,000
- ---------------------------------------------------------------
Oxford Health Plans, Inc.(a) 45,100 1,164,144
- ---------------------------------------------------------------
PhyCor, Inc.(a) 49,950 1,151,972
- ---------------------------------------------------------------
Wellpoint Health Networks,
Inc.(a) 75,000 3,431,250
- ---------------------------------------------------------------
11,235,993
- ---------------------------------------------------------------
HEALTH CARE (MEDICAL PRODUCTS &
SUPPLIES)-0.35%
Physician Sales & Service,
Inc.(a) 50,000 1,225,000
- ---------------------------------------------------------------
Quintiles Transnational Corp.(a) 70,000 5,075,000
- ---------------------------------------------------------------
ResMed, Inc.(a) 40,000 1,120,000
- ---------------------------------------------------------------
Sybron International Corp.(a) 32,800 1,316,100
- ---------------------------------------------------------------
8,736,100
- ---------------------------------------------------------------
HEALTH CARE (SPECIALIZED SERVICES)-1.05%
American HomePatient, Inc.(a) 100,000 2,575,000
- ---------------------------------------------------------------
First Commonwealth, Inc.(a) 45,000 652,500
- ---------------------------------------------------------------
FPA Medical Management, Inc.(a) 200,000 4,825,000
- ---------------------------------------------------------------
NCS HealthCare, Inc.-Class A(a) 110,000 2,571,250
- ---------------------------------------------------------------
Omnicare, Inc. 173,300 4,819,906
- ---------------------------------------------------------------
Orthodontic Centers of America,
Inc.(a) 123,000 2,129,438
- ---------------------------------------------------------------
Pediatrix Medical Group, Inc.(a) 15,200 642,200
- ---------------------------------------------------------------
Renal Care Group, Inc.(a) 92,400 3,095,400
- ---------------------------------------------------------------
Renal Treatment Centers, Inc.(a) 50,000 1,659,375
- ---------------------------------------------------------------
Superior Consultant Holdings
Corp.(a) 32,300 1,001,300
- ---------------------------------------------------------------
Total Renal Care Holdings,
Inc.(a) 62,667 1,930,916
- ---------------------------------------------------------------
Transition Systems, Inc.(a) 14,700 297,675
- ---------------------------------------------------------------
26,199,960
- ---------------------------------------------------------------
HOUSEHOLD FURNISHINGS & APPLIANCES-0.23%
Ethan Allen Interiors, Inc. 160,000 5,670,000
- ---------------------------------------------------------------
</TABLE>
6
<PAGE> 9
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
HOUSEWARES-0.48%
Central Garden and Pet Co.(a) 75,000 $ 1,968,750
- ---------------------------------------------------------------
Helen of Troy Ltd.(a) 600,000 9,975,000
- ---------------------------------------------------------------
11,943,750
- ---------------------------------------------------------------
INSURANCE
(PROPERTY-CASUALTY)-0.25%
CapMAC Holdings, Inc. 35,000 1,050,000
- ---------------------------------------------------------------
CMAC Investment Corp. 24,400 1,334,375
- ---------------------------------------------------------------
HCC Insurance Holdings, Inc. 137,550 3,215,231
- ---------------------------------------------------------------
Vesta Insurance Group, Inc. 12,000 697,500
- ---------------------------------------------------------------
6,297,106
- ---------------------------------------------------------------
LODGING (HOTELS)-0.07%
Prime Hospitality Corp.(a) 30,000 611,250
- ---------------------------------------------------------------
Suburban Lodges of America,
Inc.(a) 20,000 495,000
- ---------------------------------------------------------------
Wyndham Hotel Corp.(a) 16,700 750,456
- ---------------------------------------------------------------
1,856,706
- ---------------------------------------------------------------
MACHINERY (DIVERSIFIED)-0.13%
DT Industries, Inc. 105,000 3,150,000
- ---------------------------------------------------------------
MANUFACTURING (SPECIALIZED)-0.59%
Halter Marine Group, Inc.(a) 187,700 9,819,056
- ---------------------------------------------------------------
US Filter Corp.(a) 120,150 4,821,019
- ---------------------------------------------------------------
14,640,075
- ---------------------------------------------------------------
OFFICE EQUIPMENT & SUPPLIES-0.27%
Daisytek International Corp.(a) 50,000 1,906,250
- ---------------------------------------------------------------
Herman Miller, Inc. 100,000 4,887,500
- ---------------------------------------------------------------
6,793,750
- ---------------------------------------------------------------
OIL & GAS (DRILLING & EQUIPMENT)-4.55%
Camco International, Inc. 100,000 7,225,000
- ---------------------------------------------------------------
Cliffs Drilling Co.(a) 100,000 7,268,750
- ---------------------------------------------------------------
Cooper Cameron Corp.(a) 100,000 7,225,000
- ---------------------------------------------------------------
Diamond Offshore Drilling, Inc. 100,000 6,225,000
- ---------------------------------------------------------------
ENSCO International, Inc. 140,000 5,888,750
- ---------------------------------------------------------------
EVI, Inc.(a) 200,000 12,837,500
- ---------------------------------------------------------------
Falcon Drilling Company, Inc.(a) 150,000 5,456,250
- ---------------------------------------------------------------
Global Industries Ltd.(a) 250,000 5,031,250
- ---------------------------------------------------------------
Global Marine, Inc.(a) 125,000 3,890,625
- ---------------------------------------------------------------
Marine Drilling Companies,
Inc.(a) 140,000 4,147,500
- ---------------------------------------------------------------
Maverick Tube Corp.(a) 77,200 2,721,300
- ---------------------------------------------------------------
National-Oilwell, Inc.(a) 150,000 11,484,375
- ---------------------------------------------------------------
Newpark Resources, Inc.(a) 200,000 8,300,000
- ---------------------------------------------------------------
Pride International, Inc.(a) 178,800 5,900,400
- ---------------------------------------------------------------
Tuboscope Vetco International
Corp. 156,600 4,972,050
- ---------------------------------------------------------------
Varco International, Inc.(a) 107,500 6,550,781
- ---------------------------------------------------------------
MARKET
SHARES VALUE
OIL & GAS (DRILLING & EQUIPMENT)-(CONTINUED)
Veritas DGC, Inc.(a) 200,000 $ 8,187,500
- ---------------------------------------------------------------
113,312,031
- ---------------------------------------------------------------
PERSONAL CARE-0.28%
Rexall Sundown, Inc.(a) 321,000 7,021,875
- ---------------------------------------------------------------
RESTAURANTS-0.60%
Apple South, Inc. 150,800 2,808,650
- ---------------------------------------------------------------
Foodmaker, Inc.(a) 300,000 4,931,250
- ---------------------------------------------------------------
Landry's Seafood Restaurants,
Inc.(a) 100,000 2,800,000
- ---------------------------------------------------------------
Papa John's International,
Inc.(a) 22,500 665,156
- ---------------------------------------------------------------
Showbiz Pizza Time, Inc.(a) 96,600 2,052,750
- ---------------------------------------------------------------
Starbucks Corp.(a) 50,000 1,650,000
- ---------------------------------------------------------------
14,907,806
- ---------------------------------------------------------------
RETAIL (BUILDING SUPPLIES)-0.17%
Eagle Hardware & Garden, Inc.(a) 250,000 4,250,000
- ---------------------------------------------------------------
RETAIL (COMPUTERS & ELECTRONICS)-0.75%
CompUSA, Inc.(a) 172,000 5,633,000
- ---------------------------------------------------------------
MicroAge, Inc.(a) 250,000 5,500,000
- ---------------------------------------------------------------
Tech Data Corp.(a) 166,600 7,413,700
- ---------------------------------------------------------------
18,546,700
- ---------------------------------------------------------------
RETAIL (DISCOUNTERS)-0.14%
Men's Wearhouse, Inc. (The)(a) 87,400 3,386,750
- ---------------------------------------------------------------
RETAIL (FOOD CHAINS)-0.13%
Quality Food Centers, Inc.(a) 67,900 3,233,738
- ---------------------------------------------------------------
RETAIL (HOME SHOPPING)-0.29%
CDW Computer Centers, Inc.(a) 85,800 5,319,600
- ---------------------------------------------------------------
Micro Warehouse, Inc.(a) 134,700 2,020,500
- ---------------------------------------------------------------
7,340,100
- ---------------------------------------------------------------
RETAIL (SPECIALTY)-1.65%
Garden Ridge Corp.(a) 75,000 1,003,125
- ---------------------------------------------------------------
Genesco Inc.(a) 200,000 2,537,500
- ---------------------------------------------------------------
Hollywood Entertainment Corp.(a) 200,000 2,450,000
- ---------------------------------------------------------------
Inacom Corp.(a) 50,000 1,540,625
- ---------------------------------------------------------------
Michaels Stores, Inc.(a) 100,000 3,006,250
- ---------------------------------------------------------------
O'Reilly Automotive, Inc.(a) 200,000 4,875,000
- ---------------------------------------------------------------
Petco Animal Supplies, Inc.(a) 67,000 2,060,250
- ---------------------------------------------------------------
Pier 1 Imports, Inc. 397,500 7,254,375
- ---------------------------------------------------------------
Staples, Inc.(a) 235,800 6,189,750
- ---------------------------------------------------------------
Tiffany & Co. 50,200 1,982,900
- ---------------------------------------------------------------
Viking Office Products, Inc.(a) 106,100 2,539,769
- ---------------------------------------------------------------
Williams-Sonoma, Inc.(a) 75,000 3,009,375
- ---------------------------------------------------------------
Zale Corp.(a) 100,000 2,525,000
- ---------------------------------------------------------------
40,973,919
- ---------------------------------------------------------------
</TABLE>
7
<PAGE> 10
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
RETAIL (SPECIALTY-APPAREL)-0.42%
Gap, Inc. 58,400 $ 3,106,150
- ---------------------------------------------------------------
Pacific Sunwear of California(a) 112,500 3,107,813
- ---------------------------------------------------------------
TJX Companies, Inc. 140,500 4,162,312
- ---------------------------------------------------------------
10,376,275
- ---------------------------------------------------------------
SAVINGS & LOAN COMPANIES-0.10%
Dime Bancorp, Inc. 100,000 2,400,000
- ---------------------------------------------------------------
SERVICES
(ADVERTISING/MARKETING)-0.28%
CKS Group, Inc.(a) 190,000 6,887,500
- ---------------------------------------------------------------
SERVICES (COMMERCIAL & CONSUMER)-1.27%
ABR Information Services, Inc.(a) 75,000 1,762,500
- ---------------------------------------------------------------
Caribiner International, Inc.(a) 100,000 4,456,250
- ---------------------------------------------------------------
Cerner Corp.(a) 202,000 4,898,500
- ---------------------------------------------------------------
Children's Comprehensive
Services, Inc.(a) 186,200 3,360,328
- ---------------------------------------------------------------
Equity Corp. International(a) 255,000 5,195,625
- ---------------------------------------------------------------
IntelliQuest Information Group,
Inc.(a) 245,000 4,165,000
- ---------------------------------------------------------------
MSC Industrial Direct Co.,
Inc.-Class A(a) 40,000 1,665,000
- ---------------------------------------------------------------
Rental Service Corp.(a) 92,900 2,485,075
- ---------------------------------------------------------------
Strayer Education, Inc. 75,000 3,581,250
- ---------------------------------------------------------------
31,569,528
- ---------------------------------------------------------------
SERVICES (COMPUTER SYSTEMS)-0.31%
Insight Enterprises, Inc.(a) 150,000 5,868,750
- ---------------------------------------------------------------
SunGard Data Systems Inc.(a) 80,200 1,894,725
- ---------------------------------------------------------------
7,763,475
- ---------------------------------------------------------------
SERVICES (DATA PROCESSING)-0.89%
Affiliated Computer Services,
Inc.(a) 128,400 3,226,050
- ---------------------------------------------------------------
BDM International Inc.(a) 126,500 2,798,813
- ---------------------------------------------------------------
BISYS Group, Inc. (The)(a) 81,900 2,549,137
- ---------------------------------------------------------------
Computer Data Systems, Inc. 75,100 3,107,262
- ---------------------------------------------------------------
CSG Systems International,
Inc.(a) 85,000 3,330,938
- ---------------------------------------------------------------
Envoy Corp.(a) 100,000 2,800,000
- ---------------------------------------------------------------
National Data Corp. 75,000 2,770,312
- ---------------------------------------------------------------
PMT Services, Inc.(a) 100,000 1,612,500
- ---------------------------------------------------------------
22,195,012
- ---------------------------------------------------------------
SERVICES (EMPLOYMENT)-0.36%
RemedyTemp, Inc.- Class A(a) 38,000 874,000
- ---------------------------------------------------------------
Robert Half International,
Inc.(a) 111,000 4,544,063
- ---------------------------------------------------------------
Romac International, Inc.(a) 100,000 2,000,000
- ---------------------------------------------------------------
Vincam Group, Inc. (The)(a) 49,500 1,553,062
- ---------------------------------------------------------------
8,971,125
- ---------------------------------------------------------------
TELECOMMUNICATIONS (LONG DISTANCE)-0.18%
Billing Information Concepts(a) 79,600 3,124,300
- ---------------------------------------------------------------
MARKET
SHARES VALUE
TELECOMMUNICATIONS (LONG DISTANCE)-(CONTINUED)
USLD Communications Corp.(a) 64,200 $ 1,271,963
- ---------------------------------------------------------------
4,396,263
- ---------------------------------------------------------------
TEXTILES (APPAREL)-0.85%
Jones Apparel Group, Inc.(a) 100,000 5,087,500
- ---------------------------------------------------------------
Liz Claiborne, Inc. 69,000 3,497,437
- ---------------------------------------------------------------
Nautica Enterprises, Inc.(a) 125,000 3,328,125
- ---------------------------------------------------------------
Quicksilver, Inc.(a) 100,000 3,075,000
- ---------------------------------------------------------------
St. John Knits, Inc. 75,000 3,014,062
- ---------------------------------------------------------------
Tommy Hilfiger Corp.(a) 87,900 3,477,544
- ---------------------------------------------------------------
21,479,668
- ---------------------------------------------------------------
TEXTILES (HOME FURNISHINGS)-0.18%
Mohawk Industries, Inc.(a) 75,000 2,306,250
- ---------------------------------------------------------------
WestPoint Stevens, Inc.(a) 50,000 2,050,000
- ---------------------------------------------------------------
4,356,250
- ---------------------------------------------------------------
TRUCKING-0.24%
Caliber System, Inc. 25,000 1,303,125
- ---------------------------------------------------------------
Hub Group, Inc.(a) 100,000 3,050,000
- ---------------------------------------------------------------
Swift Transportation Co., Inc.(a) 50,000 1,600,000
- ---------------------------------------------------------------
5,953,125
- ---------------------------------------------------------------
WASTE MANAGEMENT-0.33%
Thermo Instrument Systems Inc.(a) 20,000 721,250
- ---------------------------------------------------------------
USA Waste Services, Inc.(a) 200,000 7,400,000
- ---------------------------------------------------------------
8,121,250
- ---------------------------------------------------------------
Total Domestic Common Stocks 793,976,811
- ---------------------------------------------------------------
FOREIGN STOCKS & OTHER EQUITY INTERESTS-61.07%
ARGENTINA-2.22%
Banco de Galicia y Buenos Aires
S.A. de C.V.-ADR
(Banks-Regional) 500,439 12,127,826
- ---------------------------------------------------------------
Banco Rio de La Plata S.A.-ADR
(Banks-Money Center)(a) 461,000 4,840,500
- ---------------------------------------------------------------
Disco S.A.-ADR (Retail-Food
Chains)(a) 69,500 2,814,750
- ---------------------------------------------------------------
Perez Companc S.A.-Class B (Oil &
Gas-Refining & Marketing) 2,004,489 12,555,697
- ---------------------------------------------------------------
Telefonica de Argentina S.A.-ADR
(Telephone) 268,500 7,551,562
- ---------------------------------------------------------------
YPF S.A.-ADR (Oil-International
Integrated) 479,600 15,347,200
- ---------------------------------------------------------------
55,237,535
- ---------------------------------------------------------------
AUSTRALIA-0.48%
QBE Insurance Group Ltd.
(Insurance-Property-Casualty) 2,055,929 9,614,782
- ---------------------------------------------------------------
QBE Insurance Group Ltd.-Bonus
shares
(Insurance-Property-Casualty)(a) 513,982 2,342,248
- ---------------------------------------------------------------
11,957,030
- ---------------------------------------------------------------
</TABLE>
8
<PAGE> 11
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
AUSTRIA-0.38%
VA Technologie A.G. (Engineering
& Construction) 53,200 $ 9,439,946
- ---------------------------------------------------------------
BELGIUM-0.74%
Barco Industries
(Manufacturing-Diversified) 41,000 7,909,040
- ---------------------------------------------------------------
COLRUYT S.A. (Retail-Food Chains) 8,800 4,720,923
- ---------------------------------------------------------------
UCB S.A.
(Manufacturing-Diversified) 1,650 5,701,352
- ---------------------------------------------------------------
18,331,315
- ---------------------------------------------------------------
BRAZIL-3.94%
Banco Bradesco S.A. (Banks-Major
Regional) 1,316,000 9,788,380
- ---------------------------------------------------------------
CESP-Companhia Energetica de Sao
Paulo (Electric Companies)(a) 65,000 4,068,212
- ---------------------------------------------------------------
Cia. Riograndense de
Telecomunicacoes-Pfd.
(Telephone) (Acquired 08/06/97;
Cost $181,844)(a)(b) 1,425 109,847
- ---------------------------------------------------------------
Cia. Riograndense de
Telecomunicacoes-Pfd.
(Telephone) 65,000 5,011,565
- ---------------------------------------------------------------
Companhia Brasileira de
Distribuicao Grupo Pao de
Acucar (Retail-Food Chains) 326,500 6,219,330
- ---------------------------------------------------------------
Companhia Brasileira de
Distribuicao Grupo Pao de
Acucar-ADR (Retail-Food Chains) 120,519 2,229,602
- ---------------------------------------------------------------
Companhia Energetica de Minas
Gerais (Electric Companies) 196,000 7,822,577
- ---------------------------------------------------------------
Companhia Paranaense de
Energia-Copel (Electric
Companies) 240,000 2,897,546
- ---------------------------------------------------------------
Companhia Paranaense de
Energia-Copel-ADR (Electric
Companies) 400,000 4,775,000
- ---------------------------------------------------------------
Companhia de Saneamento Basico do
Estado de Sao Paulo (Water
Utilities) 39,041 7,224,263
- ---------------------------------------------------------------
Eletricidade de Sao Paulo S.A.
(Electric Companies)(a) 13,600 2,319,198
- ---------------------------------------------------------------
Eletricidade de Sao Paulo S.A.
Rts. (Electric Companies)(a) 3,265 11,848
- ---------------------------------------------------------------
Multicanal Participacoes S.A.-ADR
(Broadcasting-Television, Radio &
Cable)(a) 315,000 1,949,063
- ---------------------------------------------------------------
Petroleo Brasileiro
S.A.-Petrobras (Oil &
Gas-Exploration & Production) 46,200 8,590,866
- ---------------------------------------------------------------
Telecomunicacoes de Sao Paulo
S.A.-TELESP-Pfd. (Telephone) 44,700 11,677,264
- ---------------------------------------------------------------
Telecomunicacoes Brasileiras
S.A.-Telebras-ADR (Telephone) 94,700 9,612,050
- ---------------------------------------------------------------
Uniao de Bancos Brasileiros
S.A.-GDR (Banks-Regional)(a) 278,200 7,580,950
- ---------------------------------------------------------------
Votorantim Celulose e Papel S.A.
(Paper & Forest Products) 259,500 6,192,975
- ---------------------------------------------------------------
98,080,536
- ---------------------------------------------------------------
CANADA-6.45%
ATI Technologies, Inc.
(Computers-Hardware)(a) 160,000 3,303,651
- ---------------------------------------------------------------
MARKET
SHARES VALUE
CANADA-(CONTINUED)
ATS Automation Tooling Systems,
Inc.
(Manufacturing-Diversified)
(Acquired 09/22/97; Cost
$2,432,112)(a)(b) 70,000 $ 2,446,163
- ---------------------------------------------------------------
ATS Automation Tooling Systems,
Inc.
(Manufacturing-Diversified)(a) 110,000 3,843,971
- ---------------------------------------------------------------
Biovail Corporation International
(Health Care-Drugs-Generic &
Other)(a) 160,000 4,620,000
- ---------------------------------------------------------------
Canadian Fracmaster Ltd. (Oil &
Gas-Exploration & Production) 155,000 2,557,030
- ---------------------------------------------------------------
Canadian Natural Resources Ltd.
(Oil & Gas-Exploration &
Production)(a) 345,000 10,036,542
- ---------------------------------------------------------------
CanWest Global Communications
Corp. (Broadcasting-Television,
Radio & Cable) 355,998 6,820,127
- ---------------------------------------------------------------
CGI Group, Inc.
(Services-Computer Systems)(a) 135,000 3,836,343
- ---------------------------------------------------------------
C-MAC Industries Inc.
(Electronics-Component
Distributors)(a) 200,000 2,909,143
- ---------------------------------------------------------------
Discreet Logic, Inc.
(Communications Equipment)(a) 175,000 3,423,438
- ---------------------------------------------------------------
Enerflex Systems Ltd.
(Manufacturing- Specialized) 96,000 2,724,660
- ---------------------------------------------------------------
Ensign Resource Service Group,
Inc. (Oil & Gas-Drilling &
Equipment) 200,000 7,287,047
- ---------------------------------------------------------------
Extendicare, Inc.-Class A (Health
Care-Long Term Care)(a) 350,000 5,389,009
- ---------------------------------------------------------------
Four Seasons Hotels, Inc.
(Lodging-Hotels) 85,000 2,816,547
- ---------------------------------------------------------------
Geac Computer Corporation Ltd.
(Services-Computer Systems)(a) 581,400 17,367,537
- ---------------------------------------------------------------
Gulf Canada Resources Ltd.
(Oil-International
Integrated)(a) 250,000 2,093,750
- ---------------------------------------------------------------
Hummingbird Communications Ltd.
(Computers-Software &
Services)(a) 72,000 2,567,141
- ---------------------------------------------------------------
Imax Corp. (Communications
Equipment)(a) 150,000 3,806,250
- ---------------------------------------------------------------
IPSCO, Inc. (Iron & Steel) 60,000 2,596,942
- ---------------------------------------------------------------
JDS Fitel Inc. (Manufacturing
Specialized)(a) 200,000 11,459,183
- ---------------------------------------------------------------
Leitch Technology Corp.
(Electronics-Instrumentation)
(Acquired 06/25/97; Cost
$376,739)(a)(b) 16,500 504,594
- ---------------------------------------------------------------
Leitch Technology Corp.
(Electronics-Instrumentation)(a) 147,000 4,495,477
- ---------------------------------------------------------------
Linamar Corp. (Machinery
Diversified) 58,000 3,656,508
- ---------------------------------------------------------------
MDS, Inc.-Class B (Health
Care-Specialized Services) 218,000 5,034,874
- ---------------------------------------------------------------
Mitel Corp. (Communications
Equipment)(a) 370,200 3,244,027
- ---------------------------------------------------------------
Newcourt Credit Group, Inc.
(Savings & Loan Companies) 120,000 4,150,850
- ---------------------------------------------------------------
Northern Telecom Ltd.
(Communications Equipment) 25,000 2,242,188
- ---------------------------------------------------------------
Philip Services Corp. (Waste
Management)(a) 200,000 3,500,000
- ---------------------------------------------------------------
</TABLE>
9
<PAGE> 12
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
CANADA-(CONTINUED)
Precision Drilling Corp. (Oil &
Gas-Drilling & Equipment)(a) 250,000 $ 7,687,500
- ---------------------------------------------------------------
Prudential Steel Ltd. (Oil &
Gas-Drilling & Equipment) 200,000 8,372,654
- ---------------------------------------------------------------
Royal Group Technologies Ltd.
(Manufacturing-Specialized)(a) 105,000 2,674,637
- ---------------------------------------------------------------
Sears Canada, Inc.
(Retail-Department Stores) 300,000 4,959,733
- ---------------------------------------------------------------
Shaw Industries Ltd. (Oil &
Gas-Exploration & Production) 14,200 574,307
- ---------------------------------------------------------------
Suncor, Inc. (Oil-International
Integrated) 210,000 7,561,997
- ---------------------------------------------------------------
160,563,820
- ---------------------------------------------------------------
CHILE-1.12%
Cia. de Telecomunicaciones de
Chile S.A.-ADR (Telephone) 287,300 7,972,575
- ---------------------------------------------------------------
Distribucion y Servicio D&S
S.A.-ADR (Retail-Food
Chains)(a) 650,000 11,415,625
- ---------------------------------------------------------------
Quinenco S.A.-ADR
(Financial-Diversified)(a) 580,900 8,495,663
- ---------------------------------------------------------------
27,883,863
- ---------------------------------------------------------------
DENMARK-0.56%
Bang & Olufsen Holding A/S-Class
B (Electronics-Component
Distributors) 90,000 5,487,721
- ---------------------------------------------------------------
Kobenhavns Lufthavne A/S
(Shipping) 35,000 4,188,199
- ---------------------------------------------------------------
Olicom A/S
(Computers-Networking)(a) 150,000 4,312,500
- ---------------------------------------------------------------
13,988,420
- ---------------------------------------------------------------
FINLAND-0.71%
KCI Konecranes
(Machinery-Diversified) 76,750 2,893,007
- ---------------------------------------------------------------
Hartwall OY A.B.
(Beverages-Alcoholic) 80,000 6,572,272
- ---------------------------------------------------------------
TT Tieto OY -Class B
(Computers-Software & Services) 74,000 8,296,525
- ---------------------------------------------------------------
17,761,804
- ---------------------------------------------------------------
FRANCE-1.91%
BERTRAND FAURE (Auto Parts &
Equipment) 110,000 6,636,328
- ---------------------------------------------------------------
Christian Dalloz
(Manufacturing-Diversified) 11,400 1,353,790
- ---------------------------------------------------------------
Compagnie Generale de Geophysique
S.A. (Services-Commercial &
Consumer)(a) 26,000 3,605,946
- ---------------------------------------------------------------
Coflexip S.A. (Metal Fabricators) 48,161 5,310,171
- ---------------------------------------------------------------
Coflexip S.A.-ADR (Metal
Fabricators) 15,900 874,500
- ---------------------------------------------------------------
Dassault Systemes S.A.-ADR
(Computers-Software & Services) 200,000 6,000,000
- ---------------------------------------------------------------
Grand Optical Photoservice
(Services- Commercial &
Consumer) 26,400 4,251,828
- ---------------------------------------------------------------
ISIS (Oil-International
Integrated) (Acquired 10/23/97;
Cost $2,222,817)(a)(b) 19,400 2,270,186
- ---------------------------------------------------------------
Labinal S.A. (Aerospace/Defense) 8,300 2,151,172
- ---------------------------------------------------------------
LDC S.A. (Foods) 7,500 1,209,206
- ---------------------------------------------------------------
MARKET
SHARES VALUE
FRANCE-(CONTINUED)
Le Carbone-Lorraine (Housewares) 9,100 $ 2,413,730
- ---------------------------------------------------------------
Moulinex (Household Furnishings &
Appliances)(a) 250,000 5,634,291
- ---------------------------------------------------------------
Penauille Polyservices
(Services-Facilities &
Environmental) 5,300 1,068,591
- ---------------------------------------------------------------
Vallourec S.A.
(Manufacturing-Diversified) 73,000 4,796,429
- ---------------------------------------------------------------
47,576,168
- ---------------------------------------------------------------
GERMANY-1.79%
BETA Systems Software A.G.
(Computers-Software &
Services)(Acquired 06/26/97;
Cost $289,738)(a)(b) 5,000 478,996
- ---------------------------------------------------------------
Boewe Systec A.G. (Office
Equipment & Supplies) 75,000 2,220,803
- ---------------------------------------------------------------
Continental A.G. (Auto Parts &
Equipment) 185,000 4,414,607
- ---------------------------------------------------------------
Fresenius A.G.-Pfd. (Health
Care-Medical Products &
Supplies) 26,000 4,392,835
- ---------------------------------------------------------------
Hugo Boss A.G.-Pfd.
(Textile-Apparel) 1,750 2,214,997
- ---------------------------------------------------------------
IWKA A.G. (Machinery-Diversified) 8,100 2,017,534
- ---------------------------------------------------------------
Plettac A.G.
(Manufacturing-Diversified) 10,000 1,817,285
- ---------------------------------------------------------------
Plettac A.G.-Rts.
(Manufacturing-Diversified)(a) 10,000 581
- ---------------------------------------------------------------
Porsche A.G. (Automobiles) 6,300 9,272,506
- ---------------------------------------------------------------
ProSieben Media A.G.-Pfd.
(Broadcasting-Television, Radio, &
Cable)(a) 54,000 2,649,287
- ---------------------------------------------------------------
SCHMALBACH LUBECA A.G.
(Containers-Metal & Glass) 20,000 3,715,853
- ---------------------------------------------------------------
Schwarz Pharma A.G. (Health
Care-Drugs-Generic & Other) 85,000 6,020,844
- ---------------------------------------------------------------
SKW Trostberg A.G.
(Chemicals-Diversified) 77,600 2,667,240
- ---------------------------------------------------------------
Vossloh A.G.
(Manufacturing-Specialized) 50,200 2,541,551
- ---------------------------------------------------------------
44,424,919
- ---------------------------------------------------------------
GREECE-0.12%
Titan Cement Co. S.A.
(Construction-Cement &
Aggregates) 60,000 2,932,041
- ---------------------------------------------------------------
HONG KONG-4.94%
Asia Satellite Telecommunications Holdings
Ltd.
(Telecommunications-Cellular/Wireless) 1,530,000 3,680,786
- ---------------------------------------------------------------
Asia Satellite Telecommunications
Holdings Ltd.-ADR
(Telecommunications-Cellular/Wireless) 177,300 4,144,389
- ---------------------------------------------------------------
China Resources Enterprise Ltd.
(Manufacturing-Diversified) 5,414,000 14,845,347
- ---------------------------------------------------------------
China Telecom (Hong Kong) Ltd.
ADR
(Telecommunications-Cellular &
Wireless)(a) 202,000 6,539,750
- ---------------------------------------------------------------
Cosco Pacific Ltd.
(Financial-Diversified) 9,100,000 10,593,029
- ---------------------------------------------------------------
Esprit Asia Holdings Ltd.
(Retail-Specialty- Apparel) 10,520,000 3,741,835
- ---------------------------------------------------------------
</TABLE>
10
<PAGE> 13
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
HONG KONG-(CONTINUED)
First Pacific Company Ltd.
(Distributors-Food & Health) 13,326,033 $ 8,402,562
- ---------------------------------------------------------------
Hong Kong & China Gas Co. Ltd.
(Natural Gas) 6,723,840 12,697,156
- ---------------------------------------------------------------
Hutchison Whampoa Ltd.
(Retail-Food Chains) 2,255,000 15,604,023
- ---------------------------------------------------------------
Johnson Electric Holdings Ltd.
(Electrical Equipment) 4,968,000 13,558,145
- ---------------------------------------------------------------
New World Infrastructure Ltd.
(Services-Commercial &
Consumer)(a) 3,080,000 6,095,066
- ---------------------------------------------------------------
Shanghai Industrial Holdings Ltd.
(Manufacturing-Diversified) 2,532,000 11,265,705
- ---------------------------------------------------------------
South China Morning Post Ltd.
(Publishing-Newspapers) 8,168,000 7,078,264
- ---------------------------------------------------------------
Sun Hung Kai Properties Ltd.
(Land Development) 625,000 4,607,773
- ---------------------------------------------------------------
122,853,830
- ---------------------------------------------------------------
HUNGARY-0.19%
Richter Gedeon Rt.-GDR (Health
Care-Drugs-Major
Pharmaceuticals) 50,000 4,650,000
- ---------------------------------------------------------------
INDONESIA-0.58%
Gulf Indonesia Resources Ltd.
(Oil-International
Integrated)(a) 310,000 6,510,000
- ---------------------------------------------------------------
PT Indosat (Telephone) 808,000 1,821,082
- ---------------------------------------------------------------
PT Indosat-ADR (Telephone) 87,500 2,072,656
- ---------------------------------------------------------------
PT Ramayana Lestari Sentosa
(Retail- Department Stores) 2,324,000 3,932,427
- ---------------------------------------------------------------
14,336,165
- ---------------------------------------------------------------
ITALY-0.26%
Autogrill S.p.A (Restaurants)(a) 775,000 3,556,852
- ---------------------------------------------------------------
Gewiss S.p.A. (Electrical
Equipment) 150,000 2,923,804
- ---------------------------------------------------------------
6,480,656
- ---------------------------------------------------------------
IRELAND-0.72%
CBT Group PLC-ADR
(Computers-Software &
Services)(a) 7,600 583,300
- ---------------------------------------------------------------
Elan Corp. PLC-ADR (Health
Care-Drugs-Generic & Other)(a) 200,000 9,975,000
- ---------------------------------------------------------------
Saville Systems Ireland
PLC-ADR(a)(Services- Data
Processing) 125,000 7,468,750
- ---------------------------------------------------------------
18,027,050
- ---------------------------------------------------------------
ISRAEL-2.60%
Blue Square-Israel Ltd.-ADR
(Retail-Food Chains)(a) 550,000 6,393,750
- ---------------------------------------------------------------
Crystal Systems Solutions
(Computers- Software &
Services)(a) 110,000 2,310,000
- ---------------------------------------------------------------
ESC Medical Systems Ltd. (Health
Care- Medical Products &
Supplies)(a) 300,000 11,775,000
- ---------------------------------------------------------------
MARKET
SHARES VALUE
ISRAEL-(CONTINUED)
NICE-Systems Ltd. ADR
(Communications Equipment)(a) 113,000 $ 5,268,625
- ---------------------------------------------------------------
Orbotech, Ltd.
(Computers-Software & Services) 138,000 5,899,500
- ---------------------------------------------------------------
Panamerican Beverages, Inc.-Class
A (Beverages-Non-Alcoholic) 574,400 17,806,400
- ---------------------------------------------------------------
Tecnomatix Technologies Ltd.
(Computers-Software &
Services)(a) 87,500 2,701,563
- ---------------------------------------------------------------
Teledata Communication Ltd.
(Communications Equipment)(a) 70,100 2,173,100
- ---------------------------------------------------------------
Teva Pharmaceutical Industries
Ltd.-ADR (Health
Care-Drugs-Generic & Other) 198,500 9,279,875
- ---------------------------------------------------------------
Tower Semiconductor Ltd.
(Electronics-Semiconductors) 100,000 1,175,000
- ---------------------------------------------------------------
64,782,812
- ---------------------------------------------------------------
JAPAN-2.78%
Aderans Co. Ltd. (Personal Care) 394,000 10,607,063
- ---------------------------------------------------------------
Bellsystem 24, Inc.
(Services-Commercial &
Consumer) 48,000 6,620,690
- ---------------------------------------------------------------
Capcom Co., Ltd.
(Computers-Software & Services) 201,000 3,340,257
- ---------------------------------------------------------------
Circle K Japan Co. Ltd.
(Retail-Food Chains) 222,000 11,399,751
- ---------------------------------------------------------------
FCC Co. Ltd. (Auto Parts &
Equipment) 143,110 2,259,319
- ---------------------------------------------------------------
Fujitsu Denso Ltd. (Electrical
Equipment) 340,000 5,311,175
- ---------------------------------------------------------------
Hokuto Corp. (Agricultural
Products) 185,250 5,248,878
- ---------------------------------------------------------------
Noritsu Koki Co. Ltd.
(Photography/Imaging) 315,600 10,489,406
- ---------------------------------------------------------------
77 Bank (Banks-Major Regional) 770,000 7,293,727
- ---------------------------------------------------------------
Shohkoh Fund & Co.
(Financial-Diversified) 20,600 6,675,529
- ---------------------------------------------------------------
69,245,795
- ---------------------------------------------------------------
MEXICO-4.62%
Cifra S.A. de C.V.
(Retail-General Merchandise)(a) 6,454,900 11,162,320
- ---------------------------------------------------------------
Coca-Cola Femsa S.A.-ADR
(Beverages-Non-Alcoholic) 363,700 15,707,294
- ---------------------------------------------------------------
Corporacion Interamericana de
Entretenimiento S.A.
(Entertainment)(a) 683,000 3,958,712
- ---------------------------------------------------------------
Fomento Economico Mexicano, S.A.
de C.V.-Class B
(Beverages-Alcoholic) 2,852,700 20,072,665
- ---------------------------------------------------------------
Grupo Financiero Banamex Accival,
S.A. de C.V.
(Financial-Diversified)(a) 5,850,000 11,581,395
- ---------------------------------------------------------------
Grupo Industrial Maseca S.A. de
C.V.-Class B (Foods) 5,844,600 5,645,945
- ---------------------------------------------------------------
Grupo Modelo S.A. de C.V.
(Beverages- Alcoholic) 1,056,000 7,820,823
- ---------------------------------------------------------------
Grupo Televisa S.A.-GDR
(Entertainment)(a) 424,700 13,165,700
- ---------------------------------------------------------------
Kimberly-Clark de Mexico, S.A. de
C.V.-Class A (Paper & Forest
Products) 2,460,500 10,783,945
- ---------------------------------------------------------------
</TABLE>
11
<PAGE> 14
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
MEXICO-(CONTINUED)
Organizacion Soriana S.A. de C.V.
(Retail-Department Stores) 2,900,000 $ 9,649,374
- ---------------------------------------------------------------
Tubos de Acero de Mexico S.A.
(Oil & Gas-Drilling &
Equipment)(a) 125,000 2,523,438
- ---------------------------------------------------------------
TV Azteca, S.A. de C.V.-ADR
(Broadcasting-Television, Radio &
Cable)(a) 156,100 2,985,413
- ---------------------------------------------------------------
115,057,024
- ---------------------------------------------------------------
NETHERLANDS-4.43%
Aalberts Industries N.V.
(Manufacturing-Diversified) 115,000 3,014,937
- ---------------------------------------------------------------
Beter Bed Holding N.V. (Household
Furnishings & Appliances) 115,000 2,505,537
- ---------------------------------------------------------------
Brunel International N.V.
(Services- Employment)
(Acquired 06/19/97; Cost
$1,997,948)(a)(b) 95,000 2,006,181
- ---------------------------------------------------------------
CMG PLC (Computers-Software &
Services) 517,200 12,174,113
- ---------------------------------------------------------------
Draka Holding N.V. (Metal
Fabricators) 60,000 2,898,790
- ---------------------------------------------------------------
Fugro N.V. (Services-Commercial &
Consumer) 180,000 6,350,760
- ---------------------------------------------------------------
Gamma Holding N.V.
(Textiles-Apparel) 53,000 2,839,042
- ---------------------------------------------------------------
Getronics N.V.
(Computers-Software & Services) 300,000 9,904,713
- ---------------------------------------------------------------
IHC Caland N.V.
(Manufacturing-Specialized) 114,000 7,010,868
- ---------------------------------------------------------------
Internatio-Muller N.V.
(Manufacturing-Diversified) 288,000 9,152,511
- ---------------------------------------------------------------
Koninklijke Ahrend Groep N.V.
(Household Furnishings &
Appliances) 210,000 6,998,197
- ---------------------------------------------------------------
Koninklijke Van Ommeren N.V.
(Shipping) 122,000 4,367,242
- ---------------------------------------------------------------
NORIT N.V. (Chemicals Specialty) 200,000 3,224,311
- ---------------------------------------------------------------
Nutreco Holding N.V.
(Agricultural Products)(a) 235,000 5,277,363
- ---------------------------------------------------------------
Oce-Van Der Grinten N.V. (Office
Equipment & Supplies) 67,000 7,643,832
- ---------------------------------------------------------------
Ordina Beheer N.V.-W.I.
(Services-Commercial &
Consumer)(a) 400,000 6,469,225
- ---------------------------------------------------------------
Randstad Holdings N.V.
(Services-Commercial &
Consumer) 292,500 11,675,895
- ---------------------------------------------------------------
Simac Techniek N.V.
(Electronics-Instrumentation) 25,000 3,197,270
- ---------------------------------------------------------------
Vedior N.V. (Services-Commercial & Consumer)
(Acquired 06/05/97; Cost
$1,500,539)(a)(b) 75,000 1,541,333
- ---------------------------------------------------------------
Vedior N.V. (Services-Commercial
& Consumer) 100,000 2,055,112
- ---------------------------------------------------------------
110,307,232
- ---------------------------------------------------------------
NORWAY-2.56%
ASK A.S.A. (Computer
Peripherals)(a) 405,000 3,627,785
- ---------------------------------------------------------------
Blom A.S.A. (Services-Facilities
& Environmental)(a) 244,000 2,412,933
- ---------------------------------------------------------------
MARKET
SHARES VALUE
NORWAY-(CONTINUED)
Blom A.S.A.-Rts.
(Services-Facilities &
Environmental)(a) 34,268 $ 4,911
- ---------------------------------------------------------------
Det Sondenfjelds-Norske
Dampskibsselskab (Oil &
Gas-Refining & Marketing)(a) 250,000 5,625,305
- ---------------------------------------------------------------
Ekornes A.S.A. (Household
Furnishings & Appliances) 300,000 2,751,741
- ---------------------------------------------------------------
Farstad Shipping A.S.A.
(Shipping) 406,000 2,612,635
- ---------------------------------------------------------------
Fred. Olsen Energy A.S.A. (Oil &
Gas-Drilling & Equipment)
(Acquired 10/07/97; Cost
$3,100,584)(a)(b) 152,900 3,856,795
- ---------------------------------------------------------------
Merkantildata A.S.A.
(Services-Commercial &
Consumer) 150,000 5,052,025
- ---------------------------------------------------------------
NetCom A.S.A.
(Cellular/Wireless
Telecommunications) (a) 150,000 3,633,158
- ---------------------------------------------------------------
Saevik Supply A.S.A.
(Oil-International
Integrated)(a) 160,000 3,668,988
- ---------------------------------------------------------------
Seateam Technology A.S.A.
(Oil & Gas-Exploration &
Production)(a) 150,000 3,009,717
- ---------------------------------------------------------------
Smedvig A.S.A.-Class A (Oil &
Gas-Drilling & Equipment) 160,000 4,838,479
- ---------------------------------------------------------------
Smedvig A.S.A.-Class B (Oil &
Gas-Drilling & Equipment) 140,000 4,133,345
- ---------------------------------------------------------------
Tandberg A.S.A. (Communications
Equipment)(a) 110,000 1,734,170
- ---------------------------------------------------------------
Tandberg Television A.S.A.
(Communications Equipment)(a) 440,000 4,225,070
- ---------------------------------------------------------------
Tomra Systems A.S.A.
(Manufacturing Specialized) 486,000 12,537,621
- ---------------------------------------------------------------
63,724,678
- ---------------------------------------------------------------
PERU-0.47%
Telefonica del Peru S.A.-ADR
(Telephone) 486,500 9,608,375
- ---------------------------------------------------------------
Telefonica del Peru S.A.-Class B
(Telephone) 1,026,000 2,044,442
- ---------------------------------------------------------------
11,652,817
- ---------------------------------------------------------------
PHILIPPINES-0.98%
DMCI Holdings Inc.
(Homebuilding)(a) 23,400,000 1,848,236
- ---------------------------------------------------------------
International Container Terminal
Services, Inc. (Air Freight)(a) 12,225,000 2,413,963
- ---------------------------------------------------------------
Ionics Circuit Inc.
(Electronics-Component
Distributors) 6,040,000 3,535,402
- ---------------------------------------------------------------
Metro Pacific Corp.
(Manufacturing-Diversified) 36,247,820 2,413,113
- ---------------------------------------------------------------
Philippine Long Distance
Telephone Co. (Telephone) 194,920 4,811,142
- ---------------------------------------------------------------
Philippine Long Distance
Telephone Co.-ADR (Telephone) 159,400 3,865,450
- ---------------------------------------------------------------
SM Prime Holdings Inc. (Land
Development) 32,000,000 5,596,615
- ---------------------------------------------------------------
24,483,923
- ---------------------------------------------------------------
</TABLE>
12
<PAGE> 15
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
PORTUGAL-1.51%
Cimpor-Cimentos de Portugal S.A.
(Construction-Cement &
Aggregates) 250,000 $ 6,326,415
- ---------------------------------------------------------------
Electricidade de Portugal,
S.A.-ADR (Electric
Companies)(a) 158,500 5,537,594
- ---------------------------------------------------------------
Jeronimo Martins & Filho, S.A.
(Retail General Merchandise) 56,000 3,662,212
- ---------------------------------------------------------------
Portugal Telecom S.A. (Telephone) 265,000 10,872,761
- ---------------------------------------------------------------
Semapa (Building Materials) 110,000 2,539,664
- ---------------------------------------------------------------
Telecel-Comunicacaoes Pessoais, S.A.
(Cellular/Wireless
Telecommunications) (a) 34,900 3,149,725
- ---------------------------------------------------------------
Telecel-Comunicacaoes Pessoais, S.A.-ADR
(Cellular/Wireless
Telecommunications) (a) 60,000 5,425,078
- ---------------------------------------------------------------
37,513,449
- ---------------------------------------------------------------
SINGAPORE-0.80%
City Developments Ltd. (Land
Development) 789,000 3,306,286
- ---------------------------------------------------------------
Creative Technology Limited
(Computers-Peripherals)(a) 100,000 2,543,750
- ---------------------------------------------------------------
DBS Land Ltd. (Land Development) 3,205,000 5,453,587
- ---------------------------------------------------------------
Overseas Union Bank Ltd.
(Banks-Major Regional) 1,236,000 4,120,000
- ---------------------------------------------------------------
Wing Tai Holdings Ltd. (Land
Development) 3,600,000 4,571,429
- ---------------------------------------------------------------
19,995,052
- ---------------------------------------------------------------
SOUTH AFRICA-0.54%
Dimension Data Holdings Ltd.
(Computers-Software &
Services)(a) 1,500,000 6,233,766
- ---------------------------------------------------------------
Persetel Holdings Ltd.
(Computers-Software & Services) 760,000 4,777,143
- ---------------------------------------------------------------
Protea Furnishers Ltd. (Household
Furnishings & Appliances) 4,700,000 2,441,559
- ---------------------------------------------------------------
13,452,468
- ---------------------------------------------------------------
SPAIN-1.12%
Azkoyen S.A.
(Manufacturing-Specialized) 17,000 1,870,970
- ---------------------------------------------------------------
Corp. Financiera Reunida, S.A.
(Investment Management)(a) 1,475,000 7,908,847
- ---------------------------------------------------------------
Mapfre Vida (Insurance-Life &
Health) 54,000 3,303,774
- ---------------------------------------------------------------
Prosegur, CIA de Seguridad S.A.
(Services- Commercial &
Consumer) 400,000 4,482,024
- ---------------------------------------------------------------
Tele Pizza, S.A. (Restaurants)(a) 100,000 6,867,395
- ---------------------------------------------------------------
Vidrala S.A.
(Manufacturing-Specialized) 80,000 3,514,127
- ---------------------------------------------------------------
27,947,137
- ---------------------------------------------------------------
SWEDEN-1.27%
AB Lindex
(Retail-Specialty-Apparel) 130,000 3,662,265
- ---------------------------------------------------------------
Allgon A.B.-Class B (Electronic
Components/Miscellaneous) 57,000 913,230
- ---------------------------------------------------------------
MARKET
SHARES VALUE
SWEDEN-(CONTINUED)
Assa Abloy A.B.-Class B (Metal
Fabricators) 230,000 $ 5,251,071
- ---------------------------------------------------------------
B.T. Industries A.B.
(Machinery-Diversified) 130,000 2,777,073
- ---------------------------------------------------------------
Europolitan Holdings A.B.
(Telecommunications-Cellular &
Wireless)(a) 94,400 3,377,775
- ---------------------------------------------------------------
Hemkopskedjan A.B. (Retail-Food
Chains)(a)(b) 100,000 1,034,727
- ---------------------------------------------------------------
Hoganas A.B. (Metals Mining) 170,000 6,309,831
- ---------------------------------------------------------------
Munters A.B.(Services-Facilities
& Environmental)(a) (b) 185,000 1,877,195
- ---------------------------------------------------------------
Scandic Hotels A.B.
(Lodging-Hotels)(a) 39,500 896,541
- ---------------------------------------------------------------
Telefonaktiebolaget LM
Ericsson-ADR (Communications
Equipment) 122,360 5,414,430
- ---------------------------------------------------------------
31,514,138
- ---------------------------------------------------------------
SWITZERLAND-2.33%
Ares-Serono Group-Class B (Health
Care-Drugs-Generic & Other) 4,000 7,570,077
- ---------------------------------------------------------------
Georg Fischer A.G. (Auto Parts &
Equipment) 1,800 2,398,715
- ---------------------------------------------------------------
Gurit-Heberlein A.G. (Chemicals
Diversified) 1,400 4,424,210
- ---------------------------------------------------------------
Kuoni Reisen A.G.
(Services-Commercial &
Consumer) 1,600 6,056,061
- ---------------------------------------------------------------
Mikron Holding A.G.
(Machinery-Diversified)(a) 17,000 2,828,781
- ---------------------------------------------------------------
Mikron Holding A.G. Wts.,
expiring 12/10/97
(Machinery-Diversified)(a) 17,000 29,138
- ---------------------------------------------------------------
Rieter Holdings Ltd.
(Machinery-Diversified) 24,500 10,585,610
- ---------------------------------------------------------------
Saurer A.G.
(Machinery-Diversified) 18,500 12,234,244
- ---------------------------------------------------------------
Selecta Group (The) (Retail-Speciality)
(Acquired 05/12/97; Cost
$2,339,099)(a)(b) 16,150 2,260,596
- ---------------------------------------------------------------
Sika Finanz A.G. (Engineering &
Construction) 16,500 4,854,847
- ---------------------------------------------------------------
Sulzer Medica (Health
Care-Medical Products &
Supplies)(a) 120,600 3,226,050
- ---------------------------------------------------------------
TAG Heuer International S.A.
(Consumer Jewelry, Novelties &
Gift)(a) 13,900 1,588,287
- ---------------------------------------------------------------
58,056,616
- ---------------------------------------------------------------
TAIWAN-0.11%
ASE Test Ltd.
(Electronics-Semiconductors)(a) 49,100 2,688,225
- ---------------------------------------------------------------
UNITED KINGDOM-7.55%
Aegis Group PLC
(Services-Advertising/Marketing) 6,000,000 6,090,233
- ---------------------------------------------------------------
Airtours PLC (Services-Commercial
& Consumer) 815,000 16,134,922
- ---------------------------------------------------------------
Alexon Group PLC
(Textiles-Apparel)(a) 555,000 2,206,828
- ---------------------------------------------------------------
</TABLE>
13
<PAGE> 16
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM-(CONTINUED)
Amersham International PLC
(Health Care-Drugs-Generic &
Other) 245,000 $ 9,423,293
- ---------------------------------------------------------------
Avis Europe PLC
(Services-Commercial &
Consumer) (Acquired 03/26/97;
Cost $2,977,263)(b) 1,484,550 3,711,149
- ---------------------------------------------------------------
Blacks Leisure Group PLC (Retail
General Merchandise) 200,000 1,469,709
- ---------------------------------------------------------------
British-Borneo Petroleum
Syndicate PLC (Oil &
Gas/Exploration & Production) 1,080,000 8,624,977
- ---------------------------------------------------------------
Capita Group PLC (Services
Commercial & Consumer) 570,000 2,945,458
- ---------------------------------------------------------------
Compass Group PLC (Services
Commercial & Consumer) 335,000 3,571,804
- ---------------------------------------------------------------
Danka Business Systems PLC-ADR
(Office Equipment & Supplies) 114,700 4,243,900
- ---------------------------------------------------------------
Dewhirst Group PLC
(Textiles-Apparel) 404,000 1,721,640
- ---------------------------------------------------------------
Dr. Solomon's Group PLC-ADR
(Computers-Software &
Services)(a) 109,600 3,356,500
- ---------------------------------------------------------------
FirstBus PLC (Shipping) 1,350,000 4,552,575
- ---------------------------------------------------------------
Games Workshop Group PLC (Leisure
Time- Products) 165,000 1,896,277
- ---------------------------------------------------------------
Goode Durrant PLC (Manufacturing
Diversified) 214,000 1,784,421
- ---------------------------------------------------------------
Graseby PLC (Electronics
Instrumentation) 425,000 1,493,827
- ---------------------------------------------------------------
Holliday Chemical Holdings PLC
(Chemicals Specialty) 675,000 2,151,714
- ---------------------------------------------------------------
Independent Insurance Group PLC
(Insurance-Property-Casualty) 185,000 3,569,413
- ---------------------------------------------------------------
Jarvis Hotels PLC
(Lodging-Hotels) 675,000 1,653,423
- ---------------------------------------------------------------
JBA Holdings PLC (Computer
Software & Services) 150,000 2,378,211
- ---------------------------------------------------------------
J.D. Wetherspoon PLC (Leisure
Time- Products) 105,000 2,853,853
- ---------------------------------------------------------------
JJB Sports PLC (Retail-General
Merchandise) 430,000 4,112,165
- ---------------------------------------------------------------
Kwik-Fit Holdings PLC
(Retail-General Merchandise) 880,500 4,778,932
- ---------------------------------------------------------------
Manchester United PLC (Leisure
Time-Products) 500,000 5,360,411
- ---------------------------------------------------------------
Mayflower Corp. PLC (The)
(Auto Parts & Equipment) 890,000 2,971,463
- ---------------------------------------------------------------
Micro Focus Group PLC ADR
(Computer Software/Services)(a) 80,000 2,685,000
- ---------------------------------------------------------------
Millennium & Copthorne Hotels PLC
(Lodging-Hotels) 350,000 2,266,640
- ---------------------------------------------------------------
Misys PLC (Services-Commercial &
Consumer) 500,000 12,604,097
- ---------------------------------------------------------------
Parity PLC (Services Commercial &
Consumer) 350,000 3,388,216
- ---------------------------------------------------------------
PizzaExpress PLC (Restaurants) 387,000 4,876,162
- ---------------------------------------------------------------
MARKET
SHARES VALUE
UNITED KINGDOM-(CONTINUED)
Powerscreen International PLC
(Machinery-Diversified) 515,000 $ 6,035,328
- ---------------------------------------------------------------
Provident Financial PLC (Consumer
Finance) 1,000,000 11,576,475
- ---------------------------------------------------------------
Sage Group PLC (The)
(Computers-Software & Services) 300,000 3,623,940
- ---------------------------------------------------------------
Scholl PLC (Health
Care-Diversified) 200,000 934,507
- ---------------------------------------------------------------
Select Appointments Holdings PLC
(Services-Commercial &
Consumer) 300,000 2,753,187
- ---------------------------------------------------------------
SEMA Group PLC (Manufacturing
Diversified) 500,000 11,232,536
- ---------------------------------------------------------------
Senior Engineering Group PLC
(Metal Fabricators) 1,100,000 3,063,572
- ---------------------------------------------------------------
Stagecoach Holdings PLC
(Shipping) 790,000 9,662,330
- ---------------------------------------------------------------
Stanley Leisure PLC (Leisure
Time-Products) 425,000 2,185,478
- ---------------------------------------------------------------
Taylor Woodrow PLC (Engineering &
Construction) 1,450,000 4,451,910
- ---------------------------------------------------------------
TBI PLC (Land Development) 500,000 721,433
- ---------------------------------------------------------------
Weir Group PLC (The)
(Machinery-Diversified) 600,000 2,793,454
- ---------------------------------------------------------------
187,911,363
- ---------------------------------------------------------------
VENEZUELA-0.29%
Cia. Anonima Nacional Telefonos
de Venezuela
(Telecommunications-Long
Distance) 165,000 7,218,750
- ---------------------------------------------------------------
Total Foreign Stocks & Other
Equity
Interests 1,520,076,577
- ---------------------------------------------------------------
DOMESTIC PREFERRED STOCK-0.23%
LODGING (HOTELS)-0.23%
Royal Caribbean Cruises
Ltd.-$3.63 Conv. Pfd. 76,000 5,776,000
- ---------------------------------------------------------------
DOMESTIC CONVERTIBLE CORPORATE NOTES-0.15%
ADVERTISING/BROADCASTING-0.06%
Jacor Communications Inc., Conv.
Sr. LYON, 5.50%, 06/12/11(c) $ 2,350,000 1,439,210
- ---------------------------------------------------------------
INSURANCE (MULTI-LINE)-0.09%
Loews Corp., Conv. Sub. Notes,
3.125%, 09/15/07 2,100,000 2,396,415
- ---------------------------------------------------------------
Total Domestic Convertible
Corporate
Notes 3,835,625
- ---------------------------------------------------------------
FOREIGN CONVERTIBLE CORPORATE BONDS-0.12%
HONG KONG-0.12%
New World Infrastructure Ltd.
(Services-Commercial &
Consumer), Conv. Bonds, 5.00%,
07/15/01 (Acquired
04/10/97-04/11/97; Cost
$2,172,563)(b) 1,850,000 1,748,250
- ---------------------------------------------------------------
</TABLE>
14
<PAGE> 17
<TABLE>
<CAPTION>
PRINCIPAL MARKET
FOREIGN CONVERTIBLE CORPORATE AMOUNT VALUE
BONDS-(CONTINUED)
<S> <C> <C>
New World Infrastructure Ltd.
(Services-Commercial &
Consumer), Conv. Bonds, 5.00%,
07/15/01 $ 1,170,000 $ 1,105,650
- ---------------------------------------------------------------
Total Foreign Convertible
Corporate
Bonds 2,853,900
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
REPURCHASE AGREEMENT(D)-5.40%
SBC Warburg Inc., 5.40%,
11/03/97(e) $134,491,340 $ 134,491,340
- ---------------------------------------------------------------
TOTAL INVESTMENTS-98.87% 2,461,010,253
- ---------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-1.13% 28,169,726
- ---------------------------------------------------------------
NET ASSETS-100.00% 2,489,179,979
===============================================================
</TABLE>
Investment Abbreviations:
ADR - American Depository Receipt
Conv. - Convertible
GDR - Global Depository Receipt
LYON - Liquid Yield Option Notes
Pfd. - Preferred
Rts. - Rights
Sr. - Senior
Sub. - Subordinated
Wts. - Warrants
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Restricted security. May be resold to qualified institutional buyers in
accordance with the provisions of Rule 144A under the Securities Act of
1933, as amended. The valuation of these securities has been determined in
accordance with procedures established by the Board of Directors. The
aggregate market value of these securities at 10/31/97 was $20,934,090,
which represented 0.84% of the Fund's net assets.
(c) Zero coupon bond. The interest rate shown represents the rate of the
original issue discount.
(d) 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, private accounts and certain
non-registered investment companies managed by the investment advisor or its
affiliates.
(e) Joint repurchase agreement entered into 10/31/97 with a maturing value of
$300,135,000. Collateralized by $295,632,000 U.S. Government obligations,
5.25% to 8.875% due 12/31/97 to 08/15/02 with an aggregate market value at
10/31/97 of $306,259,515.
See Notes to Financial Statements.
15
<PAGE> 18
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1997
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$1,987,194,427) $2,461,010,253
- ------------------------------------------------------------
Foreign currencies, at market value (cost
$19,159,068) 19,307,806
- ------------------------------------------------------------
Receivables for:
Investments sold 11,150,791
- ------------------------------------------------------------
Capital stock sold 18,652,156
- ------------------------------------------------------------
Dividends and interest 1,503,948
- ------------------------------------------------------------
Investment for deferred compensation plan 17,360
- ------------------------------------------------------------
Other assets 69,112
- ------------------------------------------------------------
Total assets 2,511,711,426
- ------------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 11,143,700
- ------------------------------------------------------------
Capital stock reacquired 6,695,997
- ------------------------------------------------------------
Deferred compensation 17,360
- ------------------------------------------------------------
Accrued advisory fees 1,984,585
- ------------------------------------------------------------
Accrued administrative services fees 8,156
- ------------------------------------------------------------
Accrued directors' fees 6,600
- ------------------------------------------------------------
Accrued distribution fees 1,704,146
- ------------------------------------------------------------
Accrued transfer agent fees 542,373
- ------------------------------------------------------------
Accrued operating expenses 428,530
- ------------------------------------------------------------
Total liabilities 22,531,447
- ------------------------------------------------------------
Net assets applicable to shares outstanding $2,489,179,979
============================================================
NET ASSETS:
Class A $1,242,504,885
============================================================
Class B $1,241,999,324
============================================================
Class C $ 4,675,770
============================================================
CAPITAL STOCK, $.001 PAR VALUE PER SHARE:
CLASS A:
Authorized 200,000,000
- ------------------------------------------------------------
Outstanding 71,884,207
============================================================
CLASS B:
Authorized 200,000,000
- ------------------------------------------------------------
Outstanding 73,069,124
============================================================
CLASS C:
Authorized 200,000,000
- ------------------------------------------------------------
Outstanding 275,023
============================================================
CLASS A:
Net asset value and redemption price per
share $ 17.28
============================================================
Offering price per share:
(Net asset value $17.28 divided by 95.25%)$ 18.14
============================================================
CLASS B:
Net asset value and offering price per
share $ 17.00
============================================================
CLASS C:
Net asset value and offering price per
share $ 17.00
============================================================
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 1997
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $1,998,577 foreign
withholding tax) $ 17,106,552
- -------------------------------------------------------------
Interest 2,731,848
- -------------------------------------------------------------
Total investment income 19,838,400
- -------------------------------------------------------------
EXPENSES:
Advisory fees 19,996,061
- -------------------------------------------------------------
Administrative services fees 109,161
- -------------------------------------------------------------
Directors' fees 20,096
- -------------------------------------------------------------
Distribution fees-Class A 5,877,002
- -------------------------------------------------------------
Distribution fees-Class B 11,173,566
- -------------------------------------------------------------
Distribution fees-Class C 6,233
- -------------------------------------------------------------
Custodian fees 1,728,899
- -------------------------------------------------------------
Transfer agent fees-Class A 2,809,254
- -------------------------------------------------------------
Transfer agent fees-Class B 3,311,554
- -------------------------------------------------------------
Transfer agent fees-Class C 1,951
- -------------------------------------------------------------
Other 1,293,733
- -------------------------------------------------------------
Total expenses 46,327,510
- -------------------------------------------------------------
Less: Expenses paid indirectly (61,449)
- -------------------------------------------------------------
Net expenses 46,266,061
- -------------------------------------------------------------
Net investment income (loss) (26,427,661)
- -------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES AND FOREIGN CURRENCIES:
Net realized gain (loss) on sales of:
Investment securities (60,146,645)
- -------------------------------------------------------------
Foreign currencies (1,044,469)
- -------------------------------------------------------------
(61,191,114)
- -------------------------------------------------------------
Net unrealized appreciation of:
Investment securities 272,184,029
- -------------------------------------------------------------
Foreign currencies 217,562
- -------------------------------------------------------------
272,401,591
- -------------------------------------------------------------
Net gain (loss) on investment securities
and foreign
currencies 211,210,477
- -------------------------------------------------------------
Net increase in net assets resulting from
operations $184,782,816
=============================================================
</TABLE>
See Notes to Financial Statements.
16
<PAGE> 19
STATEMENT OF CHANGES IN NET ASSETS
For the years ended October 31, 1997 and 1996
<TABLE>
<CAPTION>
1997 1996
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (26,427,661) $ (8,221,031)
- -----------------------------------------------------------------------------------------------
Net realized gain (loss) on sales of investment securities
and foreign currencies (61,191,114) (32,408,407)
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investment securities and
foreign currencies 272,401,591 171,434,202
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from
operations 184,782,816 130,804,764
- -----------------------------------------------------------------------------------------------
Distributions to shareholders from net realized capital gains:
Class A -- (766,625)
- -----------------------------------------------------------------------------------------------
Class B -- (520,242)
- -----------------------------------------------------------------------------------------------
Share transactions-net:
Class A 221,978,537 657,118,189
- -----------------------------------------------------------------------------------------------
Class B 350,877,196 635,669,948
- -----------------------------------------------------------------------------------------------
Class C 5,007,454 --
- -----------------------------------------------------------------------------------------------
Net increase in net assets 762,646,003 1,422,306,034
- -----------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 1,726,533,976 304,227,942
- -----------------------------------------------------------------------------------------------
End of period $2,489,179,979 $1,726,533,976
===============================================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $2,116,538,293 $1,557,038,579
- -----------------------------------------------------------------------------------------------
Undistributed net investment income (loss) (36,158) (14,054)
- -----------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) on sales of
investment securities and
foreign currencies (101,414,669) (32,181,471)
- -----------------------------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 474,092,513 201,690,922
- -----------------------------------------------------------------------------------------------
$2,489,179,979 $1,726,533,976
===============================================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
October 31, 1997
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Global Aggressive 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 management investment company consisting of four operating
series portfolios: AIM Global Aggressive Growth Fund, AIM Global Growth Fund,
AIM Global Income Fund and AIM International Equity Fund. 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
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 above-average long-term growth of capital appreciation. The Fund seeks
to achieve its objective by investing in a portfolio of global equity securities
including securities of selected companies with relatively small market
capitalization.
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements. 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.
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, at the mean between
the closing bid and asked prices on the day of valuation. 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 closing bid and asked prices on
valuation date. 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
17
<PAGE> 20
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
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 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 forward 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 forward 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 forward 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. On October 31, 1997,
capital was decreased by $18,363,473, undistributed net investment income was
increased by $26,405,557 and undistributed net realized gains decreased by
$8,042,084 in order to comply with the requirements of the American Institute
of Certified Public Accountants Statement of Position 93-2. Net assets of the
Fund were unaffected by the reclassifications discussed above.
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. The Fund has a capital loss
carryforward of $91,801,587 (which may be carried forward to offset future
taxable capital gains, if any) which expires, if not previously utilized,
through the year 2005.
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 advisory agreement, the
Fund pays an advisory fee to AIM at the annual rate of 0.90% of the first $1
billion of the Fund's average daily net assets, plus 0.85% of the Fund's average
daily net assets in excess of $1 billion.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for administrative costs incurred in providing
accounting services to the Fund. During the year ended October 31, 1997, AIM was
reimbursed $109,161 for such services.
The Fund, pursuant to a transfer agency and services 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 year ended October 31, 1997,
AFS was paid $3,429,751 for such services.
The Company has entered into a master distribution agreement 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 0.50% of the average daily net assets of Class A shares and
1.00% of the average daily net assets of Class C shares. The Class A and Class C
Plan is designed to compensate AIM Distributors for certain promotional and
other sales related costs, and to implement a dealer incentive program which
provides for periodic payments to selected dealers who furnish continuing
personal shareholder services to their customers who purchase and own Class A or
Class C shares of the Fund. The Fund, pursuant to the Class B Plan, will pay AIM
Distributors an annual rate of 1.00% of the average daily net assets
attributable to the Class B shares. Of this amount, the Fund pays a service fee
of 0.25% of the average daily net assets of the Class B shares to selected
dealers and financial institutions who furnish continuing personal shareholder
services to their customers who purchase and own Class B shares of the Fund. Any
amounts not paid as a service fee under such Plans would constitute an asset-
18
<PAGE> 21
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 the Class B Plan) and (b)
any contingent deferred sales charges received by AIM Distributors related to
the Class B shares. During the year ended October 31, 1997, Class A shares and
Class B shares and the period August 4, 1997 through October 31, 1997 Class C
shares paid AIM Distributors $5,877,002, $11,173,566 and $6,233, respectively,
as compensation under the Plans.
AIM Distributors received commissions of $2,200,552 from the sales of the
Class A shares of the Fund during the year ended October 31, 1997. 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 shares. During the year ended
October 31, 1997, AIM Distributors received commissions of $133,018 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 year ended October 31, 1997, the Fund paid legal fees of $8,986 for
services rendered by 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
AIM has directed certain portfolio trades to brokers who paid a portion of the
Fund's expenses related to pricing services used by the Fund which reduced the
Fund's expenses by $8,359 for the year ended October 31, 1997. The Fund also
received reductions in transfer agency fees from AFS (an affiliate of AIM) and
custodian fees of $29,827 and $23,263, respectively, under expense offset
arrangements. The effect of the above arrangements resulted in a reduction of
the Fund's total expenses of $61,449 during the year ended October 31, 1997.
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.
Prior to an amendment of the line of credit on July 15, 1997, the Fund was
limited to borrowing up to the lesser of i) $325,000,000 or ii) the limit set by
its prospectus for borrowings. During the year ended October 31, 1997, 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.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the year ended October 31, 1997 was
$1,686,305,972 and $1,247,124,354, respectively.
The amount of unrealized appreciation (depreciation) of investment securities
as of October 31, 1997, on a tax basis, is as follows.
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $ 600,581,618
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (136,378,875)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $ 464,202,743
=========================================================
</TABLE>
Cost of investments for tax purposes is $1,996,807,510.
NOTE 7-CAPITAL STOCK
Changes in the Fund's capital stock outstanding during the years ended October
31, 1997 and 1996 were as follows:
<TABLE>
<CAPTION>
1997 1996
--------------------------- ---------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ---------- --------------
<S> <C> <C> <C> <C>
Sold:
Class A 41,562,019 $ 712,389,030 50,205,954 $ 748,519,743
- --------------------- ----------- ------------- ---------- --------------
Class B 31,043,322 516,329,374 45,280,451 673,914,740
- --------------------- ----------- ------------- ---------- --------------
Class C* 281,009 5,113,170 -- --
- --------------------- ----------- ------------- ---------- --------------
Issued as
reinvestment of
dividends:
Class A -- -- 56,549 727,221
- --------------------- ----------- ------------- ---------- --------------
Class B -- -- 38,442 491,285
- --------------------- ----------- ------------- ---------- --------------
Reacquired:
Class A (28,025,133) (490,410,493) (6,124,044) (92,128,775)
- --------------------- ----------- ------------- ---------- --------------
Class B (9,784,297) (165,452,178) (2,588,161) (38,736,077)
- --------------------- ----------- ------------- ---------- --------------
Class C* (5,986) (105,716) -- --
- --------------------- ----------- ------------- ---------- --------------
35,070,934 $ 577,863,187 86,869,191 $1,292,788,137
===================== =========== ============= ========== ==============
</TABLE>
* Class C commenced sales on August 4, 1997.
19
<PAGE> 22
NOTE 8-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A and Class B
capital stock outstanding during each of the years in the three-year period
ended October 31, 1997 and the period September 15, 1994 (date sales commenced)
through October 31, 1994, and for a share of Class C capital stock outstanding
for the period August 4, 1997 (date sales commenced) through October 31, 1997.
<TABLE>
<CAPTION>
1997 1996 1995 1994
---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
CLASS A:
Net asset value, beginning of period $ 15.76 $ 13.09 $ 10.22 $ 10.00
- ------------------------------------------------------------ ---------- -------- -------- --------
Income from investment operations:
Net investment income (loss) (0.15)(a) (0.09)(a) (0.09)(a) --
- ------------------------------------------------------------ ---------- -------- -------- --------
Net gains on securities (both realized and unrealized) 1.67 2.81 2.96 0.22
- ------------------------------------------------------------ ---------- -------- -------- --------
Total from investment operations 1.52 2.72 2.87 0.22
- ------------------------------------------------------------ ---------- -------- -------- --------
Less distributions:
Distributions from net realized gains -- (0.05) -- --
- ------------------------------------------------------------ ---------- -------- -------- --------
Net asset value, end of period $ 17.28 $ 15.76 $ 13.09 $ 10.22
============================================================ ========== ======== ======== ========
Total return(b) 9.65% 20.83% 28.08% 2.20%
============================================================ ========== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $1,242,505 $919,319 $186,029 $ 18,410
============================================================ ========== ======== ======== ========
Ratio of expenses to average net assets 1.75%(c)(d) 1.83% 2.11% 2.02%(e)(f)
============================================================ ========== ======== ======== ========
Ratio of net investment income (loss) to average net assets (0.88)%(c) (0.62)% (0.68)% 0.27%(f)(g)
============================================================ ========== ======== ======== ========
Portfolio turnover rate 57% 44% 64% 2%
============================================================ ========== ======== ======== ========
Average brokerage commission rate paid(h) $ 0.0131 $ 0.0155 N/A N/A
============================================================ ========== ======== ======== ========
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct sales charges and for periods less than one year, total
returns are not annualized.
(c) Ratios are based on average net assets of $1,175,400,376.
(d) Ratio includes indirectly paid expenses. Excluding indirectly paid expenses,
the ratio of expenses to average net assets would have been the same.
(e) After fee waivers and/or expense reimbursements. Ratio of expenses to
average net assets prior to fee waivers and/or expense reimbursements is
4.03% (annualized) for 1994.
(f) Annualized.
(g) After fee waivers and/or expense reimbursements. Ratio of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements is (1.74)% (annualized) for 1994.
(h) The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the
total number of related shares purchased and sold, which is required to be
disclosed for fiscal years beginning September 1, 1995 and thereafter.
<TABLE>
<CAPTION>
1997 1996 1995 1994
---------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
CLASS B:
Net asset value, beginning of period $ 15.58 $ 13.02 $ 10.21 $ 10.00
- ------------------------------------------------------------ ---------- -------- -------- --------
Income from investment operations:
Net investment income (loss) (0.24)(a) (0.17)(a) (0.14)(a) --
- ------------------------------------------------------------ ---------- -------- -------- --------
Net gains (losses) on securities (both realized and
unrealized) 1.66 2.78 2.95 0.21
- ------------------------------------------------------------ ---------- -------- -------- --------
Total from investment operations 1.42 2.61 2.81 0.21
- ------------------------------------------------------------ ---------- -------- -------- --------
Less distributions:
Distributions from net realized gains -- (0.05) -- --
- ------------------------------------------------------------ ---------- -------- -------- --------
Net asset value, end of period $ 17.00 $ 15.58 $ 13.02 $ 10.21
============================================================ ========== ======== ======== ========
Total return(b) 9.11% 20.09% 27.52% 2.10%
============================================================ ========== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $1,241,999 $807,215 $118,199 $ 6,201
============================================================ ========== ======== ======== ========
Ratio of expenses to average net assets 2.30%(c)(d) 2.37% 2.62% 2.54%(e)(f)
============================================================ ========== ======== ======== ========
Ratio of net investment income (loss) to average net assets (1.44)%(c) (1.16)% (1.19)% (0.25)%(f)(g)
============================================================ ========== ======== ======== ========
Portfolio turnover rate 57% 44% 64% 2%
============================================================ ========== ======== ======== ========
Average brokerage commission rate paid(h) $ 0.0131 $ 0.0155 N/A N/A
============================================================ ========== ======== ======== ========
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct sales charges and for periods less than one year, total
returns are not annualized.
(c) Ratios are based on average net assets of $1,117,630,574.
(d) Ratio includes indirectly paid expenses. Excluding indirectly paid expenses,
the ratio of expenses to average assets would have been the same.
(e) After fee waivers and expense reimbursements. Ratio of expenses to average
net assets prior to fee waivers and/or expense reimbursements is 4.43%
(annualized) for 1994.
(f) Annualized.
(g) After fee waivers and expense reimbursements. Ratio of net investment income
(loss) to average net assets prior to fee waivers and/or expense
reimbursements is (2.14)% (annualized) for 1994.
(h) The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the
total number of related shares purchased and sold, which is required to be
disclosed for fiscal years beginning September 1, 1995 and thereafter.
20
<PAGE> 23
<TABLE>
<CAPTION>
1997
----------
<S> <C>
CLASS C:
Net asset value, beginning of period $ 18.39
- ------------------------------------------------------------ ----------
Income from investment operations:
Net investment income (loss) (0.04)(a)
- ------------------------------------------------------------ ----------
Net gains (losses) on securities (both realized and
unrealized) (1.35)
- ------------------------------------------------------------ ----------
Total from investment operations (1.39)
- ------------------------------------------------------------ ----------
Less distributions:
Distributions from net realized gains --
- ------------------------------------------------------------ ----------
Net asset value, end of period $ 17.00
============================================================ ==========
Total return(b) (7.56)%
============================================================ ==========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $ 4,676
============================================================ ==========
Ratio of expenses to average net assets 2.36%(c)(d)
============================================================ ==========
Ratio of net investment income (loss) to average net assets (1.50)%(c)
============================================================ ==========
Portfolio turnover rate 57%
============================================================ ==========
Average brokerage commission rate paid(e) $ 0.0131
============================================================ ==========
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct sales charges and for periods less than one year, total
returns are not annualized.
(c) Ratios are annualized and based on average net assets of $2,556,355.
(d) Ratio includes indirectly paid expenses. Excluding indirectly paid expenses,
the ratio of expenses to average assets would have been the same.
(e) The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the
total number of related shares purchased and sold, which is required to be
disclosed for fiscal years beginning September 1, 1995 and thereafter.
21
<PAGE> 24
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders of
AIM International Funds, Inc.:
We have audited the accompanying statement of assets and
liabilities of the AIM Global Aggressive Growth Fund (a
portfolio of AIM International Funds, Inc.), including
the schedule of investments, as of October 31, 1997, and
the related statement of operations for the year then
ended, the statement of changes in net assets for each of
the years in the two-year period then ended and the
financial highlights for the three-year period then ended
and the period September 15, 1994 (date operations
commenced) through October 31, 1994. 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 and financial highlights. Our procedures
included confirmation of securities owned as of October
31, 1997, by correspondence with the custodian and
brokers. 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 AIM Global
Aggressive Growth Fund as of October 31, 1997, the
results of its operations for the year then ended, the
changes in its net assets for each of the years in the
two-year period then ended, the financial highlights for
the three-year period then ended and the period September
15, 1994 (date operations commenced) through October 31,
1994, in conformity with generally accepted accounting
principles.
KPMG Peat Marwick LLP
Houston, Texas
December 5, 1997
22
<PAGE> 25
SUPPLEMENTAL PROXY INFORMATION -- SHAREHOLDER MEETING
- --------------------------------------------------------------------------------
An annual meeting of shareholders of the Company was held on February 7, 1997.
The meeting was held for the following purposes:
(1) To elect directors as follows: Charles T. Bauer, Bruce L. Crockett, Owen
Daly II, Carl Frischling, Robert H. Graham, John F. Kroeger, Lewis F.
Pennock, Ian W. Robinson and Louis S. Sklar.
(2) To approve a new Investment Advisory Agreement between the Company and AIM.
(3) To approve the elimination of the fundamental investment policy prohibiting
or restricting investments in other companies and/or the amendment of
certain related fundamental investment policies.
(4) Ratification of KPMG Peat Marwick LLP as independent accountants for the
Company's fiscal year ended October 31, 1997.
The following votes were cast with respect to each item:
<TABLE>
<CAPTION>
Votes Withheld/
Director/Matter Votes For Against Abstentions
--------------- --------- --------- -----------
<S> <C> <C> <C> <C>
(1) Charles T. Bauer............................................ 130,433,380 N/A 3,798,959
Bruce L. Crockett........................................... 130,563,964 N/A 3,668,375
Owen Daly II................................................ 130,421,284 N/A 3,811,055
Carl Frischling............................................. 130,515,713 N/A 3,716,626
Robert H. Graham............................................ 130,587,498 N/A 3,644,841
John F. Kroeger............................................. 130,446,846 N/A 3,785,493
Lewis F. Pennock............................................ 130,506,142 N/A 3,726,197
Ian W. Robinson............................................. 130,446,093 N/A 3,786,246
Louis S. Sklar.............................................. 130,573,480 N/A 3,658,859
(2) Approval of the new Investment Advisory Agreement........... 59,560,291 868,768 2,843,639
(3) Elimination of Policy prohibiting investments in other
investment companies........................................ 44,936,713 2,141,368 2,956,734
(4) KPMG Peat Marwick LLP....................................... 128,509,801 995,829 4,726,709
</TABLE>
23
<PAGE> 26
Directors & Officers
<TABLE>
<S> <C>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
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 Chief Senior Vice President and Treasurer 11 Greenway Plaza
Executive Officer Suite 100
COMSAT Corporation Carol F. Relihan Houston, TX 77046
Senior Vice President
Owen Daly II and Secretary TRANSFER AGENT
Director
Cortland Trust Inc. Gary T. Crum A I M Fund Services, Inc.
Senior Vice President P.O. Box 4739
Jack Fields Houston, TX 77210-4739
Formerly Member of the Dana R. Sutton
U.S. House of Representatives Vice President and Assistant Treasurer CUSTODIAN
Carl Frischling Robert G. Alley State Street Bank & Trust Company
Partner Vice President 225 Franklin Street
Kramer, Levin, Naftalis & Frankel Boston, MA 02110
Melville B. Cox
Robert H. Graham Vice President COUNSEL TO THE FUND
President and Chief Executive Officer
A I M Management Group Inc. Jonathan C. Schoolar Ballard Spahr
Vice President Andrews & Ingersoll
John F. Kroeger 1735 Market Street
Formerly Consultant P. Michelle Grace Philadelphia, PA 19103
Wendell & Stockel Associates, Inc. Assistant Secretary
COUNSEL TO THE DIRECTORS
Lewis F. Pennock Nancy L. Martin
Attorney Assistant Secretary Kramer, Levin, Naftalis & Frankel
919 Third Avenue
Ian W. Robinson Ofelia M. Mayo New York, NY 10022
Consultant; Formerly Executive Assistant Secretary
Vice President and DISTRIBUTOR
Chief Financial Officer Kathleen J. Pflueger
Bell Atlantic Management Assistant Secretary A I M Distributors, Inc.
Services, Inc. 11 Greenway Plaza
Samuel D. Sirko Suite 100
Louis S. Sklar Assistant Secretary Houston, TX 77046
Executive Vice President
Hines Interests Stephen I. Winer AUDITORS
Limited Partnership Assistant Secretary
KPMG Peat Marwick LLP
Mary J. Benson 700 Louisiana
Assistant Treasurer Houston, TX 77002
</TABLE>
<PAGE> 27
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.
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> 28
<TABLE>
<S> <C>
THE AIM FAMILY OF FUNDS--Registered Trademark--
AGGRESSIVE GROWTH
AIM Aggressive Growth Fund*
AIM Capital Development Fund
AIM Constellation Fund
AIM Global Aggressive Growth Fund
GROWTH OF CAPITAL
AIM Advisor International Value Fund
[PHOTO OF AIM Blue Chip Fund
11 GREENWAY PLAZA AIM Global Growth Fund
APPEARS HERE] AIM Growth Fund
AIM International Equity Fund
AIM Value Fund
AIM Weingarten Fund
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
HIGH CURRENT INCOME OR CURRENT INCOME
AIM High Yield Fund
AIM Global Income Fund
AIM Income Fund
CURRENT TAX-FREE INCOME
AIM Municipal Bond Fund
AIM Tax-Exempt Bond Fund of Connecticut
AIM Tax-Free Intermediate Shares
CURRENT INCOME AND HIGH DEGREE OF SAFETY
AIM Intermediate Government Fund
AIM Limited Maturity Treasury Shares
AIM Money Market Fund
AIM Tax-Exempt Cash Fund
A I M Management Group Inc. has provided leadership in the *AIM Aggressive Growth Fund was closed to new investors on
mutual fund industry since 1976 and managed approximately June 5, 1997. For more complete information about any AIM
$82 billion in assets for more than 3.6 million shareholders, Fund(s), including sales charges and expenses, ask your
including individual investors, corporate clients, and financial financial consultant or securities dealer for a free
institutions as of September 30, 1997. The AIM Family of prospectus(es). Please read the prospectus(es) carefully
Funds--Registered Trademark-- is distributed nationwide, and before you invest or send money.
AIM today ranks among the nation's top 15 mutual fund
companies in assets under management, according to Lipper INVEST WITH DISCIPLINE-SM-
Analytical Services, Inc.
[AIM LOGO APPEARS HERE] -----------------
BULK RATE
A I M Distributors, Inc. U.S. POSTAGE
11 Greenway Plaza, Suite 100 PAID
Houston, TX 77046 HOUSTON, TX
Permit No. 1919
-----------------
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