<PAGE> 1
ANNUAL REPORT / OCTOBER 31 1998
AIM ASIAN GROWTH FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE] INVEST WITH DISCIPLINE--Registered Trademark--
<PAGE> 2
---------------------------------------------------
TWO FISH JOHN S. BUNKER
THE POWER AND TURBULENCE DEPICTED IN THIS BOLD
[COVER WATERCOLOR VIVIDLY EXPRESS THE FORCES OF CHANGE
IMAGE]
SHAPING THE ASIAN REGION. ASIA'S CITIES AND NATIONS
FACE BOTH CHALLENGE AND OPPORTUNITY AS THEY DEVEL-
OP THEIR ROLES IN THE GLOBAL ECONOMY.
---------------------------------------------------
AIM Asian Growth Fund is for shareholders who seek long-term growth of capital.
The Fund invests in a diversified portfolio of companies located in Asia with
strong earnings momentum.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Asian Growth Fund's performance figures are historical and reflect
reinvestment of all distributions and changes in net asset value. Unless
otherwise indicated, the Fund's performance is computed at net asset value
without a sales charge.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B and Class C
share performance reflect the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the Fund's Class B and Class C shares will differ from
that of Class A shares due to differences in sales charge structure and Fund
expenses.
o Since inception on 11/3/97, cumulative total return including sales charges
was -27.32% for Class A shares; -27.52% for Class B shares; and -24.66% for
Class C shares. Because Class A, B, and C shares have been offered for less
than one year, total return provided is cumulative total return that has not
been annualized.
o MARKET VOLATILITY CAN SIGNIFICANTLY IMPACT SHORT-TERM PERFORMANCE. RESULTS
OF AN INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM THE HISTORICAL
PERFORMANCE SHOWN.
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 United States. These include risks relating to fluctuations in
the value of the U.S. dollar relative to the values 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 MSCI All Country Asia Free Ex-Japan Index is a group of unmanaged
securities from all developed and emerging markets in Asia, excluding Japan,
tracked by Morgan Stanley Capital International. A "Free" index includes
only securities available to non-domestic investors.
o An investment cannot be made in any index listed. Unless otherwise
indicated, index results include reinvested dividends. They do not include
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.
AIM ASIAN GROWTH FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
During the period covered by this report, a variety of
[PHOTO OF events converged to produce harsh market conditions in many
Charles T. geographic areas: continuing fallout from currency
Bauer, devaluations in Southeast Asia, the seemingly intractable
Chairman of downturn in Japan, Russia's default on much of its foreign
the Board of debt, and fear that Latin America could be engulfed by the
THE FUND world's difficulties. All of these circumstances only
APPEARS HERE] exacerbated the already troubled environment for investing
in Asia.
We at AIM understand how unnerving it is to have an
investment lose value, and we recognize that your Fund's
performance during these market conditions has probably
disappointed you. However, no investment strategy can
protect against loss during a market decline as dramatic as
the one that Asian markets were undergoing. We at AIM will
continue to manage your Fund with the careful oversight and
disciplined investment strategy used in all AIM funds. We hope you will share
our patience as investors while we seek to improve your Fund's performance and
await the market turnarounds that are inevitable if unpredictable. We opened
this Fund because of our confidence in the long-term potential of investing in
Asia, and we remain confident in that potential today.
INVESTING FUNDAMENTALS UNCHANGED
The abrupt reversals of market sentiment during this reporting period reinforce
our conviction that markets are unpredictable in the short term. Since even the
best money managers cannot know exactly when to enter and exit a market, we
remain convinced that the wisest strategy is to stay fully invested despite
volatility and short-term disappointment.
However distressing many markets have been during the period covered by this
report, the fundamental principles of investing are unchanged:
o broad portfolio diversification;
o realistic expectations, recognizing that the potential for downturns is
always present; and
o as always, long-term thinking.
Your financial consultant is your best resource not only for helping you
construct a diversified portfolio but also for helping you weather turbulent
markets and keep your eye on your long-term goals.
YOUR FUND MANAGERS' COMMENTS
We are pleased to send you this report on your Fund's performance. On the pages
that follow, your Fund's management team offers more detailed discussion of how
markets behaved, how they managed the portfolio, and what they foresee for your
Fund and the markets where it invests. We hope you find their discussion
informative.
If you have any questions or comments, please contact our Client Services
department at 800-959-4246 or e-mail your inquiry to us at [email protected].
You can access information about your account through our AIM Investor Line at
800-246-5463 or on our Web site, www.aimfunds.com. We often post market updates
on our Web site.
We thank you for your continued participation in The AIM Family of Funds
- --Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
-----------------------------------
WE OPENED THIS FUND BECAUSE OF OUR
CONFIDENCE IN THE
LONG-TERM POTENTIAL
OF INVESTING IN ASIA, AND WE REMAIN
CONFIDENT IN
THAT POTENTIAL TODAY.
-----------------------------------
AIM ASIAN GROWTH FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
FUND ENDURES A DIFFICULT YEAR IN ASIA
THE LAST YEAR HAS BEEN A ROUGH ONE FOR ASIA. HOW DID THE FUND PERFORM?
At the end of the reporting period, the Fund was just a few days shy of its
first anniversary. Its debut came at a historic time--people will be talking
about the "Asian Crisis" for years to come. The severity of the crisis is
reflected in the Fund's performance.
Cumulative total return from inception (November 3, 1997) to the end of the
reporting period was -23.10% for Class A shares, -23.70% for Class B shares, and
- -23.90% for Class C shares. In comparison, the MSCI All Country Asia Free
ex-Japan Index brought in a return of -25.05% for the period October 31, 1997 to
October 31, 1998. Please see inside the front cover for performance results that
include sales charges.
Despite the difficult environment for investing in Asia, the Fund has
continued to attract investor interest. We're pleased to report that net assets
in the Fund grew to $11.4 million as of October 31, 1998.
WHAT ARE SOME OF THE MOST IMPORTANT FACTORS AFFECTING ASIAN MARKETS?
Japan plays a crucial role in the health of Asia's economies. Unfortunately, its
own economy has been stagnant and is heading into a fourth quarter of
contraction. Economic policy is uninspired, and banks are buried under bad loans
to Southeast Asian countries. By prospectus, your Fund does not invest in Japan.
Investors also have an eye on China. With falling exports and lackluster
foreign investment, the country's economy is rapidly slowing. In Hong Kong,
currency is considered overvalued, and interest rates have skyrocketed. The Hong
Kong government bought up blue chip stocks in
August, hoping to lower the level of interest rates by driving out
speculators. Investors disapproved of the intervention and increased the
market's risk premiums.
In Southeast Asia, the people and their economies continue to suffer.
Indonesia's banks are barely functioning, and levels of poverty and social
unrest are increasing. Severe troubles in the Malaysian economy led the
government to impose capital controls earlier this year, driving investors away.
Asia's news isn't all bad, though. Taiwan may actually see some growth in
gross domestic product (GDP) in 1999, though at rates much lower than during
better times. And in other parts of Asia, serious reform efforts are being put
into place. Some of the strongest reforms are being enacted in Thailand. The
government has closed dozens of weak banks and plans to use public money to
re-capitalize stronger ones.
IS THE ASIAN CRISIS ABATING?
Toward the end of the reporting period, Asian markets took an upturn. In
September, the region rallied, inspired by a rapid decline in interest rates, a
stronger yen--which increased market interest from both local and foreign
investors, and most importantly, a limited number of negative earnings reports
for the first half of 1998.
However, the first hints of stabilization do not necessarily indicate certain
recovery. As October came to a close, economic conditions were still very weak.
Corporate earnings are still very poor, and slow reform efforts continued to
send warning signs to cautious investors.
HOW HAVE YOU MANAGED THE PORTFOLIO IN THIS ENVIRONMENT?
We've avoided the troubled companies of Southeast Asia, focusing instead on a
few pockets of growth found primarily in the perimeter markets of Taiwan, Hong
Kong, India, and Australia. As of the end of the reporting period, we had no
holdings in Malaysia or Indonesia.
In selecting companies for the portfolio, we've put extra emphasis on balance
sheet strength, minimal foreign debt, and consistent cash flow. Our investments
are concentrated in exporting companies geared to western demand and in
companies benefiting from growth in their home countries. These stocks are still
pretty hard to come by, as you can see from the limited size of the portfolio.
The Fund's 42 holdings were found in nine different countries. However, the
turnover in the Fund has been low. We've experienced very few earnings
disappointments and are sticking with quality companies.
================================================================================
THE ASIA-PACIFIC REGION
- --------------------------------------------------------------------------------
MAP
BANGLADESH SINGAPORE
CHINA AUSTRALIA
PAKISTAN NEW ZEALAND
INDIA SOUTH KOREA
MALAYSIA HONG KONG
INDONESIA TAIWAN
SRI LANKA VIETNAM
THAILAND PHILLIPPINES
================================================================================
See important Fund and index disclosures inside front cover.
AIM ASIAN GROWTH FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
HOW HAVE TECHNOLOGY STOCKS FARED?
Asia's electronics companies are benefiting from the growth of the sub-$1,000 PC
market. Some examples of high-tech companies in the portfolio included IDT
International Limited, a Hong Kong-listed company that develops LCD and
microprocessor technology; and Taiwan Semiconductor Manufacturing Co., the
world's largest dedicated integrated-circuit foundry.
WHAT ABOUT FINANCIAL STOCKS?
Significantly fewer financial stocks met our investment criteria during the last
half of the reporting period. Loan quality had continued to deteriorate, and
banks were writing off large numbers of loans. Bank reforms were being hammered
out with varying degrees of success. In October, Japan's parliament decided to
inject 60 trillion yen into its banking system. The money could help create a
market for Asian exporters and even allow Japanese banks to resume lending.
However, in the most troubled economies of Southeast Asia, major policy
inconsistencies among finance ministers, central bankers, and the International
Monetary Fund have stalled bank reform.
WHAT OTHER STOCKS DID YOU LIKE?
We've found some interesting opportunities in India, a place where the
investment picture used to be clouded by political turmoil and market
manipulation. But the scene has been changing rapidly. India's domestic economy
is strong, and trade barriers are coming down.
Of special interest are India's technology companies. For instance, the
portfolio invested in Videsh Sanchar Nigam, Ltd., India's state-run Internet
service provider. With the Internet services market being liberalized, the
company has made major improvements in order to compete.
Technology isn't the only area where we've found good companies. Some of our
holdings are considerably lower-tech. For instance, Hong Kong's Shenzhen
Expressway Co. Ltd. develops, operates, and manages toll expressways and
highways in the People's Republic of China (PRC). The company operates the only
road between Hong Kong and the mainland, passing through Shenzhen--one of the
PRC's fastest growing cities.
WHAT IS YOUR OUTLOOK FOR THE NEAR TERM?
Many analysts think Asia will finally hit bottom in 1999, indicating that
growth--and investor confidence--may begin to return some time next year. When
and if that happens, of course, depends on external demand and on the strength
of U.S., European, and Japanese economies.
Asia must undergo what is likely to be a very long and painful period of
recovery and reform. However, the ingredients for growth are still there. Asia
is still the lowest-cost, most efficient producing region in the world, boasting
brand new production infrastructure, high workforce productivity, and advanced
production techniques.
Of all the problems Asia must tackle, banking system reform is among the most
important. Stable banks are the bedrock of a healthy economy--a crucial element
before the next growth cycle can occur. We believe the requirements imposed by
the International Monetary Fund will strengthen banks and make them more
efficient.
PORTFOLIO COMPOSITION
As of October 31, 1998, based on total net assets
<TABLE>
<CAPTION>
=========================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 5 INDUSTRIES
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Cosco Pacific Ltd.(Hong Kong) 3.12% 1. Electronics (Component Distributors) 7.05%
2. Manila Electric Co.(Philippines) 3.08 2. Computers (Hardware) 6.65
3. Hutchison Whampoa Ltd.(Hong Kong) 2.95 3. Services (Commercial & Consumer) 5.34
4. PTT Exploration and Production Public Co. Ltd.(Thailand) 2.87 4. Land Development 4.47
5. IDT International Ltd.(Hong Kong) 2.80 5. Electronics (Semiconductors) 4.38
6. Shenzhen Expressway Co. Ltd.(Hong Kong) 2.69 TOP 5 COUNTRIES
1. Hong Kong 30.79%
7. Zhehuang Expressway Co. Ltd. (Hong Kong) 2.65
2. Australia 15.32
8. Bank of the Philippine Islands (Philippines) 2.64
3. Taiwan 10.54
9. Ng Fung Hong Ltd. (Singapore) 2.58
4. Philippines 10.11
10. Johnson Electric Holdings Ltd. (Hong Kong) 2.58
5. Singapore 8.77
=========================================================================================================================
</TABLE>
Please keep in mind the Fund's portfolio is subject to change and there is no
assurance the Fund will continue to hold any particular security.
See important Fund and index disclosures inside front cover.
AIM ASIAN GROWTH FUND
3
<PAGE> 6
SCHEDULE OF INVESTMENTS
October 31, 1998
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY INTERESTS-90.43%
AUSTRALIA-15.32%
AMP Ltd. (Insurance-Life/Health)(a) 22,200 $ 264,083
- --------------------------------------------------------------
Brambles Industries Ltd. (Air
Freight) 11,000 241,244
- --------------------------------------------------------------
BRL Hardy Ltd. (Beverages-Alcoholic) 80,000 265,000
- --------------------------------------------------------------
James Hardie Industries Ltd.
(Building Materials) 114,380 223,470
- --------------------------------------------------------------
Novus Petroleum Ltd. (Oil &
Gas-Exploration & Production) 61,501 74,186
- --------------------------------------------------------------
St. George Bank Ltd.
(Banks-Regional) 34,214 228,206
- --------------------------------------------------------------
TABCORP Holdings Ltd. (Leisure Time
Products) 42,858 285,113
- --------------------------------------------------------------
Village Roadshow Ltd., 6.50% Pfd.
(Entertainment)(b) (Acquired
04/23/98; Cost $200,000) 4,000 170,000
- --------------------------------------------------------------
1,751,302
- --------------------------------------------------------------
HONG KONG-30.79%
China Telecom Ltd.
(Telecommunications-Cellular/Wireless)(a) 144,000 270,540
- --------------------------------------------------------------
Cosco Pacific Ltd.
(Financial-Diversified) 728,000 357,208
- --------------------------------------------------------------
Guangdong Kelon Electrical Holdings
Co. Ltd. (Household Furniture &
Appliances) 331,000 282,084
- --------------------------------------------------------------
HKR International Ltd. (Land
Development) 507,600 286,752
- --------------------------------------------------------------
Hutchison Whampoa Ltd. (Retail-Food
Chains) 47,000 336,820
- --------------------------------------------------------------
IDT International Ltd.
(Electronics-Component
Distributors) 2,452,000 319,778
- --------------------------------------------------------------
Johnson Electric Holdings Ltd.
(Electrical Equipment) 127,000 295,177
- --------------------------------------------------------------
Li & Fung Ltd. (Distributors-Food &
Health) 156,000 243,734
- --------------------------------------------------------------
Ng Fung Hong Ltd. (Foods) 334,000 295,423
- --------------------------------------------------------------
Shenzhen Expressway Co. Ltd.
(Services-Commercial & Consumer) 1,360,000 307,315
- --------------------------------------------------------------
Varitronix International Ltd.
(Electronic
Components/Miscellaneous) 117,000 222,080
- --------------------------------------------------------------
Zhehuang Expressway Co. Ltd.
(Services-Commercial & Consumer) 1,546,000 303,431
- --------------------------------------------------------------
3,520,342
- --------------------------------------------------------------
INDIA-6.16%
Bajaj Auto Ltd. (Automobiles) 14,700 249,900
- --------------------------------------------------------------
ITC Ltd. (Tobacco) 12,100 242,000
- --------------------------------------------------------------
Videsh Sanchar Nigam Ltd.
(Telecommunications-Cellular/Wireless) 20,300 212,643
- --------------------------------------------------------------
704,543
- --------------------------------------------------------------
INDONESIA-2.28%
Gulf Indonesia Resources Ltd.
(Oil-International Integrated)(a) 26,400 260,700
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
NEW ZEALAND-1.87%
Sky Network Television Ltd.
(Broadcasting-Television, Radio &
Cable)(a) 33,400 $ 42,422
- --------------------------------------------------------------
Sky Network Television Ltd.-ADR
(Broadcasting-Television, Radio &
Cable)(a) 13,400 170,850
- --------------------------------------------------------------
213,272
- --------------------------------------------------------------
PHILIPPINES-10.11%
Bank of the Philippine Islands
(Banks-Major Regional) 155,310 301,348
- --------------------------------------------------------------
International Container Terminal
Services, Inc. (Air Freight)(a) 735,000 49,366
- --------------------------------------------------------------
Manila Electric Co. (Electric Power) 119,000 352,264
- --------------------------------------------------------------
Philippine Long Distance Telephone
Co. (Telephone) 9,530 228,767
- --------------------------------------------------------------
SM Prime Holdings Inc. (Land
Development) 1,322,900 223,774
- --------------------------------------------------------------
1,155,519
- --------------------------------------------------------------
SINGAPORE-8.77%
Datacraft Asia Ltd. (Communications
Equipment) 78,700 253,414
- --------------------------------------------------------------
Elec & Eltek International Co. Ltd.
(Computers-Hardware) 43,900 219,500
- --------------------------------------------------------------
Natsteel Electronics Ltd.
(Computers-Hardware) 143,000 293,920
- --------------------------------------------------------------
Venture Manufacturing Ltd.
(Electronics-Component
Distributors) 71,000 235,938
- --------------------------------------------------------------
1,002,772
- --------------------------------------------------------------
TAIWAN-10.54%
ASE Test Ltd.-ADR
(Electronics-Semiconductors)(a) 7,600 208,050
- --------------------------------------------------------------
Compal Electronics Inc.
(Computers-Hardware)(a) 79,000 246,456
- --------------------------------------------------------------
Hon Hai Precision Industry
(Electronics-Component
Distributors)(a) 52,000 250,564
- --------------------------------------------------------------
Lee Chi Enterprises Co., Ltd.
(Manufacturing-Specialized)(a) 85,000 207,412
- --------------------------------------------------------------
Taiwan Semiconductor Manufacturing
Co. Ltd.-ADR
(Electronics-Semiconductors) 19,600 292,775
- --------------------------------------------------------------
1,205,257
- --------------------------------------------------------------
THAILAND-4.59%
BEC World Public Co. Ltd.
(Broadcasting-Television, Radio &
Cable) 32,300 197,091
- --------------------------------------------------------------
PTT Exploration and Production
Public Co. Ltd. (Oil &
Gas-Exploration & Production) 34,000 327,867
- --------------------------------------------------------------
524,958
- --------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$10,050,433) 10,338,665
- --------------------------------------------------------------
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
<S> <C> <C>
REPURCHASE AGREEMENT-10.12%(C)
SBC Warburg Dillion Read Inc.,
5.40%, 11/02/98(d)(Cost
$1,156,875) $1,156,875 $ 1,156,875
- --------------------------------------------------------------
TOTAL INVESTMENTS (Cost
$11,207,308)-100.55% 11,495,540
- --------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES
(0.55)% (63,420)
- --------------------------------------------------------------
NET ASSETS-100.00% $11,432,120
==============================================================
</TABLE>
Abbreviations:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Restricted security. May be resold to qualified institutional buyers in
accordance with provisions of Rule 144A under the Securities Act of 1933 as
amended. The valuation of this security has been determined in accordance
with procedures established by the Board of Directors. The market value of
this security at 10/31/98 was $170,000 which represented 1.49% of the Fund's
net assets.
(c) 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 is at least 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts with other mutual funds, private
accounts and certain non-registered investment companies managed by the
investment advisor or its affiliates.
(d) Joint repurchase agreement entered into 10/30/98 with a maturing value of
$1,300,585,000. Collateralized by $2,856,569,000 U.S. Government
obligations, 0% to 5.50% due 11/15/98 to 02/15/25 with an aggregate market
value at 10/31/98 of $1,326,231,109.
See Notes to Financial Statements
5
<PAGE> 8
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1998
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$10,050,433) $ 10,338,665
- -----------------------------------------------------------
Repurchase agreement (cost $1,156,875) 1,156,875
- -----------------------------------------------------------
Foreign currencies, at value (cost $9,133) 9,394
- -----------------------------------------------------------
Receivables for:
Capital stock sold 234,866
- -----------------------------------------------------------
Dividends and interest 6,885
- -----------------------------------------------------------
Investment for deferred compensation plan 2,688
- -----------------------------------------------------------
Other assets 28,608
- -----------------------------------------------------------
Total assets 11,777,981
- -----------------------------------------------------------
LIABILITIES:
Payables for:
Capital stock reacquired 317,361
- -----------------------------------------------------------
Deferred compensation 2,688
- -----------------------------------------------------------
Accrued administrative services fees 6,728
- -----------------------------------------------------------
Accrued directors' fees 746
- -----------------------------------------------------------
Accrued distribution fees 5,007
- -----------------------------------------------------------
Accrued transfer agent fees 314
- -----------------------------------------------------------
Accrued operating expenses 13,017
- -----------------------------------------------------------
Total liabilities 345,861
- -----------------------------------------------------------
Net assets applicable to shares outstanding $ 11,432,120
===========================================================
NET ASSETS:
Class A $ 7,716,057
===========================================================
Class B $ 3,030,419
===========================================================
Class C $ 685,644
===========================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 1,003,928
===========================================================
Class B:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 397,014
===========================================================
Class C:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 90,049
===========================================================
Class A:
Net asset value and redemption price per
share $ 7.69
- -----------------------------------------------------------
Offering price per share:
(Net asset value of $7.69 / 94.50%) $ 8.14
===========================================================
Class B:
Net asset value and offering price per
share $ 7.63
===========================================================
Class C:
Net asset value and offering price per
share $ 7.61
===========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the period November 3, 1997 (date operations commenced) through October 31,
1998
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $8,794 foreign withholding
tax) $ 139,052
- -----------------------------------------------------------
Interest 32,802
- -----------------------------------------------------------
Total investment income 171,854
- -----------------------------------------------------------
EXPENSES:
Advisory fees 62,428
- -----------------------------------------------------------
Administrative services fees 74,604
- -----------------------------------------------------------
Custodian fees 40,059
- -----------------------------------------------------------
Directors' fees 6,974
- -----------------------------------------------------------
Distribution fees-Class A 16,790
- -----------------------------------------------------------
Distribution fees-Class B 14,685
- -----------------------------------------------------------
Distribution fees-Class C 3,057
- -----------------------------------------------------------
Transfer agent fees-Class A 21,729
- -----------------------------------------------------------
Transfer agent fees-Class B 9,970
- -----------------------------------------------------------
Transfer agent fees-Class C 1,757
- -----------------------------------------------------------
Registration and filing fees 56,276
- -----------------------------------------------------------
Other 30,292
- -----------------------------------------------------------
Total expenses 338,621
- -----------------------------------------------------------
Less: Fees waived and reimbursed by advisor (196,230)
- -----------------------------------------------------------
Expenses paid indirectly (781)
- -----------------------------------------------------------
Net expenses 141,610
- -----------------------------------------------------------
Net investment income 30,244
- -----------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENT
SECURITIES AND
FOREIGN CURRENCIES:
Net realized gain (loss) from:
Investment securities (1,683,405)
- -----------------------------------------------------------
Foreign currencies (3,671)
- -----------------------------------------------------------
(1,687,076)
- -----------------------------------------------------------
Net unrealized appreciation of:
Investment securities 288,232
- -----------------------------------------------------------
Foreign currencies 441
- -----------------------------------------------------------
288,673
- -----------------------------------------------------------
Net gain (loss) from investment
securities and foreign
currencies (1,398,403)
- -----------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations $ 1,368,159
===========================================================
</TABLE>
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF CHANGES IN NET ASSETS
For the period November 3, 1997 (date operations commenced) through October 31,
1998
<TABLE>
<CAPTION>
<S> <C>
OPERATIONS:
Net investment income $ 30,244
- -------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies (1,687,076)
- -------------------------------------------------------------------------
Net unrealized appreciation of investment securities and
foreign currencies 288,673
- -------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations (1,368,159)
- -------------------------------------------------------------------------
Share transactions-net:
Class A 8,755,042
- -------------------------------------------------------------------------
Class B 3,340,169
- -------------------------------------------------------------------------
Class C 705,068
- -------------------------------------------------------------------------
Net increase in net assets 11,432,120
- -------------------------------------------------------------------------
NET ASSETS:
Beginning of period 0
- -------------------------------------------------------------------------
End of period $11,432,120
=========================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $12,781,818
- -------------------------------------------------------------------------
Undistributed net investment income 45,035
- -------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities and foreign currencies (1,683,406)
- -------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 288,673
- -------------------------------------------------------------------------
$11,432,120
=========================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
October 31, 1998
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Asian Growth Fund (the "Fund") is a series portfolio of AIM International
Funds, Inc. (the "Company"). The Company is a Maryland corporation registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end series management investment company consisting of six separate
portfolios: AIM Asian Growth Fund, AIM European Development Fund, AIM Global
Aggressive Growth Fund, AIM Global Growth Fund, AIM Global Income Fund and AIM
International Equity Fund. The Fund commenced operations on November 3, 1997.
The Fund currently offers three different classes of shares: Class A shares,
Class B shares and Class C shares. Class A shares are sold with a front-end
sales charge. Class B shares and Class C shares are sold with a contingent
deferred sales charge. Matters affecting each portfolio or class are voted on
exclusively by the shareholders of such portfolio or class. The assets,
liabilities and operations of each portfolio are accounted for separately.
Information presented in these financial statements pertains only to the Fund.
The Fund's investment objective is to provide long-term growth of capital.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. The
following is a summary of significant accounting policies followed by the Fund
in the preparation of its financial statements.
A. Security Valuations-A security listed or traded on an exchange (except
convertible bonds) is valued at the last sales price on the exchange where
the security is principally traded or, lacking any sales on a particular day,
at the mean between the closing bid and asked prices on that day. If a mean
is not available, as is the case in some foreign markets, the closing bid
will be used absent a last sales price. Securities traded in the over-the-
counter market (but not including securities reported on the NASDAQ National
Market System) are valued at the mean between the last bid and asked prices
based upon quotes furnished by market makers for such securities. Securities
reported on the NASDAQ National Market System are valued at the last sales
price on the valuation date or absent a last sales price, at the mean of the
closing bid and asked prices. Debt obligations (including convertible bonds)
are valued on the basis of prices provided by an independent pricing service.
Prices provided by the pricing service may be determined without exclusive
reliance on quoted prices, and may reflect appropriate factors, such as
yield, type of issue, coupon rate and maturity date. Securities for which
market quotations are either not readily available or are questionable are
valued at fair value as determined in good faith by or under the supervision
of the Company's officers in a manner specifically authorized by the Board of
Directors. Investments with maturities of 60 days 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
7
<PAGE> 10
prior to the close of the New York Stock Exchange. The values of such
securities used in computing the net asset value of the Fund's shares are
determined as of such times. Foreign currency exchange rates are also
generally determined prior to the close of the New York Stock Exchange.
Occasionally, events affecting the values of such securities and such
exchange rates may occur between the times at which they are determined and
the close of the New York Stock Exchange which would not be reflected in the
computation of the Fund's net asset value. If events materially affecting the
value of such securities occur during such period, then these securities will
be valued at their fair value as determined in good faith by or under the
supervision of the Board of Directors.
B. Foreign Currency Translations--Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollar
amounts at the date of valuation. Purchases and sales of portfolio securities
and income items denominated in foreign currencies are translated into U.S.
dollar amounts on the respective dates of such transactions.
C. Foreign Currency Contracts--A foreign currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a foreign currency contract to attempt to
minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency contract
for the purchase or sale of a security denominated in a foreign currency in
order to "lock in" the U.S. dollar price of that security. The Fund could be
exposed to risk if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
D. Securities Transactions, Investment Income and Distributions--Securities
transactions are accounted for on a trade date basis. Realized gains or
losses are computed on the basis of specific identification of the securities
sold. Interest income is recorded as earned from settlement date and is
recorded on an accrual basis. Dividend income and distributions to
shareholders are recorded on the ex-dividend date. On October 31, 1998,
undistributed net investment income was increased by $14,791, undistributed
net realized gains increased by $3,670 and paid-in capital decreased by
$18,461 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
$1,630,826 (which may be carried forward to offset future taxable gains, if
any) which expires, if not previously utilized, in the year 2006.
F. Expenses--Distribution and transfer agency expenses directly attributable to
a class of shares are charged to that class' operations. All other expenses
which are attributable to more than one class are allocated among the
classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 0.95% of
the first $500 million of the Fund's average daily net assets, plus 0.90% of the
Fund's average daily net assets in excess of $500 million. Under the terms of a
sub-advisory agreement between AIM and INVESCO Global Asset Management Limited
("IGAM"), AIM pays IGAM a fee at an annual rate of 0.20% of the first $500
million of the Fund's average daily net assets and 0.175% of the Fund's average
daily net assets over $500 million. During the period November 3, 1997 (date
operations commenced) through October 31, 1998, AIM waived advisory fees of
$51,040 and reimbursed expenses of $145,190.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the period November 3, 1997 (date
operations commenced) through October 31, 1998, AIM was reimbursed $74,604 for
such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") for certain costs incurred in providing
transfer agency services to the Fund. During the period November 3, 1997 (date
operations commenced) through October 31, 1998, AFS was paid $24,092 for such
services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor of the Class
A, Class B and Class C shares of the Fund. The Company has adopted distribution
plans pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund's Class
A shares and Class C shares (the "Class A and Class C Plan"), and the Fund's
Class B shares (the "Class B Plan") (collectively, the "Plans"). The Fund,
pursuant to the Class A and Class C Plan, pays AIM Distributors compensation at
the annual rate of 0.35% of the average daily net assets of Class A shares and
1.00% of the average daily net assets of Class C shares. The Fund, pursuant to
the Class B Plan, pays AIM Distributors compensation at an annual rate of 1.00%
of the average daily net assets of the Class B shares. Of these amounts, the
Fund may pay a service fee of 0.25% of the average net assets of the Class A,
Class B or C shares to selected dealers and financial institutions who furnish
continuing personal shareholder services to their customers who purchase and own
the appropriate class of shares of the Fund. Any amounts not paid as a service
fee under the Plans would constitute an asset-based sales charge. The Plans also
impose a cap on the total sales charges, including asset-based sales charges
that may be paid by the respective classes. During the period November 3, 1997
(date operations commenced) through October 31, 1998, the Class A and Class B
and Class C shares paid AIM Distributors $16,790, $14,685 and $3,057,
respectively, as compensation under the Plans.
AIM Distributors received commissions of $27,913 from sales of the Class A
shares of the Fund during the period November 3, 1997 (date operations
commenced) through October 31, 1998. Such commissions are not an expense of the
Fund. They are deducted from, and are not included in, the proceeds from sales
of Class A
8
<PAGE> 11
shares. During the period November 3, 1997 (date operations commenced) through
October 31, 1998, AIM Distributors received commissions of $496 in contingent
deferred sales charges imposed on redemptions of Fund shares. Certain officers
and directors of the Company are officers and directors of AIM, AFS and AIM
Distributors.
During the period November 3, 1997 (date operations commenced) through October
31, 1998, the Fund incurred legal fees of $3,146 for services rendered by the
law firm of Kramer, Levin, Naftalis & Frankel as counsel to the Company's
directors. A member of that firm is a director of the Company.
NOTE 3-INDIRECT EXPENSES
During the period November 3, 1997 (date operations commenced) through October
31, 1998, the Fund received reductions in transfer agency fees from AFS (an
affiliate of AIM) and reductions in custodian fees of $66 and $715,
respectively, under an expense offset arrangement. The effect of the above
arrangements resulted in a reduction of the Fund's total expenses of $781 during
the period November 3, 1997 (date operations commenced) through October 31,
1998.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid or accrued to each director who is
not an "interested person" of AIM. The Company may invest directors' fees, if so
elected by a director, in mutual fund shares in accordance with a deferred
compensation plan.
NOTE 5-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by The Chase Manhattan Bank. The Fund may borrow up to
the lesser of (i) $1,000,000,000 or (ii) 10% of total assets. The Fund and other
funds advised by AIM which are parties to the line of credit may borrow on a
first come, first served basis. Interest on borrowings under the line of credit
is payable on maturity or prepayment date. During the period November 3, 1997
(date operations commenced) through October 31, 1998, the Fund did not borrow
under the line of credit agreement. The funds which are party to the line of
credit are charged a commitment fee of 0.05% on the unused balance of the
committed line. The commitment fee is allocated among the funds based on their
respective average net assets for the period.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the period November 3, 1997 (date
operations commenced) through October 31, 1998 was $16,189,012 and $4,455,173,
respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
on a tax basis, as of October 31, 1998 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $ 856,529
- --------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (620,876)
- --------------------------------------------------------
Net unrealized appreciation of investment
securities $ 235,653
========================================================
</TABLE>
Costs of investments for tax purposes is $10,103,012.
NOTE 7-CAPITAL STOCK
Changes in the Fund's capital stock outstanding during the period November 3,
1997 (date operations commenced) through October 31, 1998 were as follows:
<TABLE>
<CAPTION>
OCTOBER 31,
1998
-------------------------
SHARES AMOUNT
---------- -----------
<S> <C> <C> <C>
Sold:
Class A 2,150,231 $17,226,640
- -----------------------------------------------------------------
Class B 516,509 4,177,886
- -----------------------------------------------------------------
Class C 268,694 2,084,897
- -----------------------------------------------------------------
Reacquired:
Class A (1,146,303) (8,471,598)
- -----------------------------------------------------------------
Class B (119,495) (837,717)
- -----------------------------------------------------------------
Class C (178,645) (1,379,829)
- -----------------------------------------------------------------
1,490,991 $12,800,279
=================================================================
</TABLE>
9
<PAGE> 12
NOTE 8-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A, Class B and
Class C capital stock outstanding during the period November 3, 1997 (date
operations commenced) through October 31, 1998.
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
------- ------- -------
<S> <C> <C> <C>
Net asset value, beginning of period $ 10.00 $ 10.00 $ 10.00
- ------------------------------------------------------------ ------- ------- -------
Income from investment operations:
Net investment income 0.05 (0.01) (0.01)
- ------------------------------------------------------------ ------- ------- -------
Net gains (losses) on securities (both realized and
unrealized) (2.36) (2.36) (2.38)
- ------------------------------------------------------------ ------- ------- -------
Total from investment operations (2.31) (2.37) (2.39)
- ------------------------------------------------------------ ------- ------- -------
Net asset value, end of period $ 7.69 $ 7.63 $ 7.61
============================================================ ======= ======= =======
Total return(a) (23.10)% (23.70)% (23.90)%
============================================================ ======= ======= =======
Ratios/supplemental data:
Net assets, end of period (000s omitted) $ 7,716 $ 3,030 $ 686
============================================================ ======= ======= =======
Ratio of expenses to average net assets(b)(c) 1.92% 2.80% 2.80%
============================================================ ======= ======= =======
Ratio of net investment income (loss) to average net
assets(c)(d) 0.70% (0.18)% (0.18)%
============================================================ ======= ======= =======
Portfolio turnover rate 79% 79% 79%
============================================================ ======= ======= =======
</TABLE>
(a) Does not deduct sales charges and is not annualized for periods less than
one year.
(b) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
4.88% (annualized), 5.75% (annualized) and 5.75% (annualized) for Class A,
Class B and Class C, respectively.
(c) Ratios are annualized and based on average net assets of $4,797,215,
$1,468,486 and $305,653 for Class A, Class B and Class C, respectively.
(d) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (2.27)% (annualized), (3.15)% (annualized) and (3.15)%
(annualized), for Class A, Class B and Class C, respectively.
10
<PAGE> 13
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 Asian Growth Fund (a portfolio of
AIM International Funds, Inc.) including the schedule of
investments, as of October 31, 1998, and the related
statement of operations, changes in net assets, and
financial highlights for the period November 3, 1997 (date
operations commenced) through October 31, 1998. These
financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that
we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and
financial highlights are free of material misstatement. An
audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of
securities owned as of October 31, 1998, 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 the AIM Asian
Growth Fund as of October 31, 1998, the results of its
operations, changes in its net assets and financial
highlights for the period November 3, 1997 (date operations
commenced) through October 31, 1998, in conformity with
generally accepted accounting principles.
KPMG Peat Marwick LLP
December 4, 1998
Houston, Texas
11
<PAGE> 14
Directors & Officers
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; John J. Arthur A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Treasurer 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Carol F. Relihan Houston, TX 77046
Senior Vice President and Secretary
Owen Daly II SUB-ADVISOR
Director Gary T. Crum
Cortland Trust Inc. Senior Vice President INVESCO Global Asset Management Limited
Cedar House
Edward K. Dunn Jr. Dana R. Sutton 41 Cedar Avenue
Chairman, Mercantile Mortgage Corp.; Vice President and Assistant Treasurer Hamilton, HMI2 BERMUDA
Formerly Vice Chairman and President,
Mercantile-Safe Deposit & Trust Co.; and Robert G. Alley TRANSFER AGENT
President, Mercantile Bankshares Vice President
A I M Fund Services, Inc.
Jack Fields Melville B. Cox P.O. Box 4739
Chief Executive Officer Vice President Houston, TX 77210-4739
Texana Global, Inc.;
Formerly Member Jonathan C. Schoolar CUSTODIAN
of the U.S. House of Representatives Senior Vice President
State Street Bank and Trust Company
Carl Frischling Renee A. Friedli 225 Franklin Street
Partner Assistant Secretary Boston, MA 02110
Kramer, Levin, Naftalis & Frankel
P. Michelle Grace COUNSEL TO THE FUND
Robert H. Graham Assistant Secretary
President and Chief Executive Officer Ballard Spahr
A I M Management Group Inc. Jeffrey H. Kupor Andrews & Ingersoll, LLP
Assistant Secretary 1735 Market Street
Prema Mathai-Davis Philadelphia, PA 19103
Chief Executive Officer, YWCA of the U.S.A. Nancy L. Martin
Commissioner, New York City Dept. for the Assistant Secretary COUNSEL TO THE DIRECTORS
Aging; and member of the Board of Directors
Metropolitan Transportation Authority of Ofelia M. Mayo Kramer, Levin, Naftalis & Frankel
New York State Assistant Secretary 919 Third Avenue
New York, NY 10022
Lewis F. Pennock Lisa A. Moss
Attorney Assistant Secretary DISTRIBUTOR
Ian W. Robinson Kathleen J. Pflueger A I M Distributors, Inc.
Consultant; Formerly Executive Assistant Secretary 11 Greenway Plaza
Vice President and Suite 100
Chief Financial Officer Samuel D. Sirko Houston, TX 77046
Bell Atlantic Management Assistant Secretary
Services, Inc. AUDITORS
Stephen I. Winer
Louis S. Sklar Assistant Secretary KPMG Peat Marwick LLP
Executive Vice President 700 Louisiana
Hines Interests Mary J. Benson Houston, TX 77002
Limited Partnership Assistant Treasurer
</TABLE>
12
<PAGE> 15
HOW AIM MAKES INVESTING
EASY FOR YOU
o LOW INITIAL INVESTMENT. You can get your investment program started for as
little as $500. Subsequent investments can be made for only $50.
o AUTOMATIC REINVESTMENT OF DIVIDENDS AND/OR CAPITAL GAINS. Distributions may
be received in cash or reinvested in the Fund free of charge. Over time, the
power of compounding can significantly increase the value of your assets.
o AUTOMATIC INVESTMENT PLAN. You may build your investment by regularly
purchasing additional shares. Pre-authorized checks for $50 or more can be
drafted monthly from your personal checking account.
o EASY ACCESS TO YOUR MONEY. Your shares may be redeemed at net asset value
any day the New York Stock Exchange is open. The price of shares sold may be
more or less than their original cost, depending on market conditions.
o SYSTEMATIC WITHDRAWAL PLAN. You may elect to receive checks of at least $50
monthly or quarterly through a systematic withdrawal plan.
o EXCHANGE PRIVILEGE. As your goals change, you may exchange all or part of
your assets for those of other funds within the same share class of The AIM
Family of Funds(R). The exchange privilege may be modified or discontinued
for any of the AIM funds. Certain restrictions apply.
o RETIREMENT PLANS. You may purchase shares of an AIM fund for your Individual
Retirement Account (IRA), Roth IRA, or any other type of retirement plan,
and earn tax-deferred dollars for your retirement.
o TOLL-FREE ACCESS. Current shareholders can call our AIM Investor Line at
800-246-5463 for 24-hour-a-day account information. Or, of course, you may
contact your financial consultant for assistance.
o www.aimfunds.com. As a current shareholder, you can check account balances
24 hours a day over the Internet. State-of-the-art encryption lets you send
us questions that include confidential information without the fear of
eavesdropping, tampering, or forgery.
--------------------
CURRENT SHAREHOLDERS
CAN CALL OUR
AIM INVESTOR LINE AT
800-246-5463
FOR 24-HOUR-A-DAY
ACCOUNT INFORMATION.
--------------------
<PAGE> 16
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS INTERNATIONAL GROWTH FUNDS A I M Management Group Inc. has provided
AIM Aggressive Growth Fund(1) AIM Advisor International Value Fund leadership in the mutual fund industry
AIM Blue Chip Fund AIM Asian Growth Fund since 1976 and managed approximately $91
AIM Capital Development Fund AIM Developing Markets Fund(2) billion in assets for more than 5.5 million
AIM Constellation Fund AIM Emerging Markets Fund(2) shareholders, including individual investors,
AIM Mid Cap Equity Fund(2),(A) AIM Europe Growth Fund(2) corporate clients, and financial institutions,
AIM Select Growth Fund(3) AIM European Development Fund as of September 30, 1998.
AIM Small Cap Growth Fund(2),(B) AIM International Equity Fund The AIM Family of Funds--Registered
AIM Small Cap Opportunities Fund AIM International Growth Fund(2) Trademark-- is distributed nationwide, and AIM
AIM Value Fund AIM Japan Growth Fund(2) today is the 11th-largest mutual fund complex in
AIM Weingarten Fund AIM Latin American Growth Fund(2) the U.S. in assets under management, according to
AIM New Pacific Growth Fund(2) Strategic Insight, an independent mutual fund
GROWTH & INCOME FUNDS monitor.
AIM Advisor Flex Fund GLOBAL GROWTH FUNDS
AIM Advisor Large Cap Value Fund AIM Global Aggressive Growth Fund
AIM Advisor MultiFlex Fund AIM Global Growth Fund
AIM Advisor Real Estate Fund AIM Worldwide Growth Fund(2)
AIM Balanced Fund
AIM Basic Value Fund(2),(C) GLOBAL GROWTH & INCOME FUNDS
AIM Charter Fund AIM Global Growth & Income Fund(2)
AIM Global Utilities Fund
INCOME FUNDS
AIM Floating Rate Fund(2) GLOBAL INCOME FUNDS
AIM High Yield Fund AIM Emerging Markets Debt Fund(2),(D)
AIM High Yield Fund II AIM Global Government Income Fund(2)
AIM Income Fund AIM Global Income Fund
AIM Intermediate Government Fund AIM Strategic Income Fund(2)
AIM Limited Maturity Treasury Fund
THEME FUNDS
TAX-FREE INCOME FUNDS AIM Global Consumer Products and Services Fund(2)
AIM High Income Municipal Fund AIM Global Financial Services Fund(2)
AIM Municipal Bond Fund AIM Global Health Care Fund(2)
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Infrastructure Fund(2)
AIM Tax-Free Intermediate Fund AIM Global Resources Fund(2)
AIM Global Telecommunications Fund(2)
MONEY MARKET FUNDS AIM Global Trends Fund(2),(E)
AIM Dollar Fund(2)
AIM Money Market Fund
AIM Tax-Exempt Cash Fund
</TABLE>
(1) AIM Aggressive Growth Fund reopened to new investors November 16, 1998. (2)
Effective May 29, 1998, A I M Advisors, Inc. became advisor to the former GT
Global Funds. (3) On May 1, 1998, AIM Growth Fund was renamed AIM Select Growth
Fund. (A) On September 8, 1998, AIM Mid Cap Growth Fund was renamed AIM Mid Cap
Equity Fund. (B) On September 8, 1998, AIM Small Cap Equity Fund was renamed AIM
Small Cap Growth Fund. (C) On September 8, 1998, AIM America Value Fund was
renamed AIM Basic Value Fund. (D) On September 8, 1998, AIM Global High Income
Fund was renamed AIM Emerging Markets Debt Fund. (E) On September 8, 1998, AIM
New Dimension Fund was renamed AIM Global Trends Fund. For more complete
information about any AIM Fund(s), including sales charges and expenses, ask
your financial consultant or securities dealer for a free prospectus(es). Please
read the prospectus(es) carefully before you invest or send money.
AAG-AR-1
