<PAGE> 1
ANNUAL REPORT / OCTOBER 31 1999
AIM ASIAN GROWTH FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
<PAGE> 2
[COVER IMAGE]
-------------------------------------
TWO FISH BY JOHN S. BUNKER
THE POWER AND TURBULENCE DEPICTED IN THIS BOLD WATERCOLOR
VIVIDLY EXPRESS THE FORCES OF CHANGE SHAPING THE ASIAN REGION.
ASIA'S CITIES AND NATIONS FACE BOTH CHALLENGE AND OPPORTUNITY
AS THEY DEVELOP 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 they reflect
changes in net asset value and the reinvestment of distributions.
o Had fees and expenses not been waived during the fiscal year, returns would
have been lower.
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
shares 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
expenses.
o The fund's average annual total returns (including sales charges) for the
period ended 9/30/99 (the most recent calendar quarter-end), were as
follows: Class A shares, one year, 45.17%; inception (11/3/97), -0.27%.
Class B shares, one year, 47.32%; inception (11/3/97), -0.14%. Class C
shares, one year, 51.25%; inception (11/3/97), 1.84%.
o During the fiscal year ended 10/31/99, Class A Shares paid distributions of
$0.04 per share, and Class B and C shares paid distributions of $0.0095 per
share.
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.
o The fund participates in the initial public offering (IPO) market, and a
significant portion of the fund's returns are attributable to its investment
in IPOs, which have a magnified impact due to the fund's relatively small
asset base. There is no guarantee that as the fund's assets grow, it will
continue to experience substantially similar performance by investing in
IPOs.
o The fund's investment return and principal value will fluctuate, so an
investor's shares, when redeemed, may be worth more or less than their
original cost
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The unmanaged MSCI All Country Asia Free ex-Japan Index is a group of
securities from all developed and emerging markets in Asia (except Japan's)
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 and do not reflect
sales charges.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF A BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENT AGENCY. THERE IS A RISK THAT YOU COULD LOSE SOME OR ALL OF
YOUR MONEY.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the fund.
EFFECTIVE MARCH 1, 2000, AIM ASIAN GROWTH FUND'S INVESTMENT STRATEGY WILL BE
AMENDED TO REQUIRE THE FUND TO INVEST 65%, INSTEAD OF 80%, IN STOCKS OF
ASIAN COUNTRIES (EXCEPT JAPAN). THIS CHANGE WILL ALLOW MANAGERS GREATER
FLEXIBILITY IN MANAGING THE FUND.
AIM ASIAN GROWTH FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
The fiscal year discussed in this report reconfirmed our
[PHOTO OF faith in two long-established principles of investing:
Charles T. portfolio diversification and long-term thinking. We could
Bauer, title this report "What a Difference a Year Makes."
Chairman of An investor surveying conditions when the fiscal year
the Board of opened on October 31, 1998, saw a market dominated by
THE FUND large-capitalization stocks and high-quality bonds,
APPEARS HERE] especially U.S. Treasuries. Ten months into 1998, two
well-known indexes of large-capitalization U.S. company
stocks, the S&P 500 and the Dow Jones Industrial Average,
were up by double digits, but the smaller-company stocks in
the Russell 2000 had lost 12.80%. Overseas, many markets
were languishing, especially in Asia, where many financial
difficulties originated in 1997.
In bond markets also, name-brand quality was the place
to be. The Lehman Corporate/Government Bond Index, which
follows intermediate and long-term government and investment-grade debt, was up
8.56%, while the Lehman High Yield Index, which tracks riskier "junk bonds," had
dropped 2.30%.
It would be easy for an investor to conclude that blue chips, whether equity
or fixed-income, were the only place to be. That investor, of course, would be
wrong.
MARKETS TURN
While large-capitalization stocks continue to do very well, during 1999 markets
broadened considerably, with many investment sectors performing a complete
turnaround. Year to date by October 31, 1999, the small-cap stocks in the
Russell 2000 were back in positive territory, and the many Asian markets had
staged a comeback. The same holds true for bonds. The higher-quality Lehman
index is down 1.49% year to date through October 31, 1999, while high-yield
bonds have moved into positive returns.
The point, at the risk of sounding repetitive to those of you who have
invested with us for a long time, is that this is why diversification is a
fundamental investing principle. Market sectors and asset classes go in and out
of favor, but over the long run--and the long run is several years--the markets'
overall trend has been upward. Selecting an asset class or a market sector on
the basis of a short-term snapshot of conditions is usually unwise, as is
concentrating your portfolio in one asset class. Staying fully invested in a
diversified portfolio remains a compelling strategy and one of your best
prospects for long-term gain.
LOOKING AHEAD
As we look about at the close of this fiscal year, we are encouraged by signs of
economic health in Europe and Asia, not to mention the prolonged U.S. economic
expansion. However, we are aware of how easily an investor could have been
misled by conditions just 12 months ago. For our shareholders, we therefore
reiterate our commitment to investing through a financial advisor. In addition
to helping you select investments appropriate to your time horizon and risk
tolerance, a financial advisor can keep you informed about how changing market
conditions affect you and your portfolio and can help assure that when you do
alter your investments, there's a logical reason for doing so. AIM believes
every investor should be guided by a financial professional.
FUND MANAGERS COMMENT
In the pages that follow, your fund's portfolio managers discuss how they
managed your fund during the year ended October 31, 1999, how the markets
behaved and what they foresee for the near future. We trust you will find their
discussion informative. If you have any questions or comments, we invite you to
contact us, either at our Web site, aimfunds.com, or through our Client Services
department at 800-959-4246. Information about your account is also available
through our automated AIM Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of Funds
- --Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
-------------------------------------
STAYING FULLY
INVESTED IN A DIVERSIFIED
PORTFOLIO REMAINS
A COMPELLING STRATEGY
AND ONE OF YOUR
BEST PROSPECTS FOR
LONG-TERM GAIN.
-------------------------------------
AIM ASIAN GROWTH FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
FUND FEASTS ON ASIAN RECOVERY
THIS YEAR, ASIAN MARKETS HAVE BOUNCED BACK IMPRESSIVELY FROM THEIR 1997-1998
CRISIS. HOW HAS THE FUND RESPONDED?
What a difference a year makes. After weathering last year's dramatic Asian
crisis, the fund roared back to life. Average annual returns at net asset value
(without sales charges) for the fiscal year ended October 31, 1999, were
impressive, totaling 40.79% for Class A shares, 39.76% for Class B shares and
39.86% for Class C shares. By comparison, the fund's benchmark--the MSCI All
Country Asia Free ex-Japan Index--posted a return of 53.45% for the same period.
The fund's performance helped attract significant investor attention over
the 12-month period as net assets increased almost fourfold to $42.5 million.
WHAT'S DRIVING ASIA'S RECOVERY?
Performance during the first half of 1999 was largely driven by improvements at
the macro level, including emergence from a recession, stable currencies, benign
inflation, improving trade balances and--perhaps most importantly--declining
interest rates.
When the crisis hit, interest rates shot up and remained at high levels,
choking off economic growth while at the same time stabilizing economies and
currencies. Once economies stabilized, banks were able to lower rates. Since
then, we've seen a strong correlation between declining interest rates and
market performance.
Restructuring has also played a major role in the Asian recovery. Countries
that have focused most on cleaning up their banking systems and stabilizing
their currencies have outperformed this year, including Singapore, Taiwan and
South Korea.
Trends like these are bringing foreign investors back into the region and
are beginning to build confidence among consumers within the region as well.
DO YOU THINK THE RECOVERY IS SUSTAINABLE?
We feel confident that the recovery we've seen so far in 1999 will persist
because the region is back in a growth environment. We're not blindly
optimistic, but many of the countries are taking the steps necessary to further
their recoveries, and that's being reflected in such indicators as corporate
earnings expectations. Recent analysts' earnings revisions have turned net
positive, meaning more upgrades than downgrades. Another positive sign is that
almost every economy in Asia is expected to post positive economic growth in
1999, as measured by gross domestic product (GDP).
We think the past quarter marked a defining period for these markets going
forward. As mentioned before, the first-half performance was driven by
macro-level improvements, which benefited every economy in the region.
Third-quarter weakness indicates these factors have largely played themselves
out. We believe the focus now will shift to earnings growth and sustainability
of the restructuring efforts that began in response to last year's financial
crisis.
OTHER THAN THE OBVIOUS RECOVERY, TO WHAT DO YOU ATTRIBUTE THE FUND'S STRONG
PERFORMANCE THIS YEAR?
Because we use a bottom-up selection process and because the fund is fairly
small, we've been able to be nimble and invest our way around the crisis. For
example, early on in the crisis we favored the more developed countries,
including Hong Kong, Australia and Singapore, and maintained low weightings in
Thailand and South Korea because they were probably the two most troubled
economies in the region. But now South Korea has one of the largest weightings
in the fund because we're finding a number of terrific earnings-momentum stories
there as companies restructure and reduce their debt levels.
HAVE THERE BEEN ANY DISAPPOINTMENTS?
Almost without exception, the first-half rally in Asian stock markets peaked in
early July--the same time regional interest rates reached a trough. As rates
appeared to bottom out, Asian markets outside of Japan dipped in September--some
as much as 15%--eroding some of the fund's gains from earlier in the year.
In the third quarter, the fund slightly underperformed its peer group due to
a low weighting in India, which posted a surprisingly strong return for the
quarter, and an overweight position in the Philippines. We've divested some
holdings there as a result of earnings disappointments and have increased our
exposure to Australia and South Korea by adding some
================================================================================
ASIA'S POWERFUL PURCHASING POTENTIAL
A major element of Asia's economic potential is its people. Accounting for more
than half the world's population, Asian consumers represent formidable
purchasing power, which bears heavily on continued recovery in the region.
[MAP]
CHINA NEW ZEALAND
SOUTH KOREA AUSTRALIA
HONG KONG SINGAPORE
TAIWAN INDONESIA
VIETNAM BANGLADESH
PHILIPPINES THAILAND
MALAYSIA SRI LANKA
INDIA
PAKISTAN
================================================================================
See important fund and index disclosures inside front cover.
AIM ASIAN GROWTH FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
companies with strong upward revision momentum, including Foster's Brewing and
Samsung Electronics.
WHAT SECTORS DID YOU FIND MOST ATTRACTIVE?
With personal consumption in the region improving, the fund has increased its
exposure to the Asian consumer in countries where spending is coming back--for
example, mid-market clothing retailers in Hong Kong. Recovery in exports is also
driving fund performance through holdings in port operators, cargo handlers and
contract manufacturers.
The financial sector's continuing consolidation has drawn our attention as
well. For example, Development Bank of Singapore has made some judicious
acquisitions. Hong Kong financial companies also look promising because of their
moves to diversify their earnings base to include more non-interest income
offerings--such as credit cards--to help reduce cyclical risk.
WHAT IS YOUR OUTLOOK FOR THE REGION?
Overall we're fairly positive on Asia right now. When you marry a strong,
relatively long earnings cycle with improving economic growth and markets that
are still reasonably valued, you have a good recipe for equity performance.
For the moment, attractive market fundamentals are being overshadowed by
several issues: investor concerns about demand in the United States--a major
export destination for Asian-produced goods--U.S. interest rates and a nascent
Japanese recovery. These issues are worthy of consideration since Asia's
recovery is geared to global economic growth. However, it's important to
remember that a major element of Asia's economic potential is its large
population, and domestic personal consumption bears heavily on continued
recovery. Asian consumers have enormous savings and once they begin to feel
secure about their jobs, they will exert their buying power.
THE WAY TO AN INVESTOR'S HEART
Political and economic unrest in Indonesia--especially its former colony of East
Timor--may have given some Asian investors financial heartburn. Fund managers
agreed and largely steered clear of investing in a country they felt had done
little to rectify its problems. However, using their bottom-up stock-selection
approach, which relies on company-by-company analysis, fund managers did find at
least one appetizing investment opportunity in Indonesia: the world's largest
noodle-maker, Indofood. According to fund managers, "Whether you're in crisis or
not, noodles are the staple of the Indonesian diet and the company continues to
increase its sales every year."
PORTFOLIO COMPOSITION
As of 10/31/99, based on total net assets
<TABLE>
<CAPTION>
===================================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 INDUSTRIES TOP 10 COUNTRIES
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. ERG Ltd. (Australia) 3.01% 1. Electronics (Component Distribution) 5.91% 1. Hong Kong 26.33%
2. Giordano International Ltd. (Hong Kong) 2.10 2. Banks (Major Regional) 5.29 2. Singapore 15.43
3. Li & Fung Ltd. (Hong Kong) 1.97 3. Banks (Regional) 4.92 3. Australia 13.85
4. Kookmin Bank (South Korea) 1.91 4. Electrical Equipment 4.76 4. South Korea 10.20
5. Far Eastern Textile Ltd. (Taiwan) 1.87 5. Land Development 4.72 5. Philippines 6.48
6. Korea Telecom Corp.-ADR (South Korea) 1.82 6. Telephone 4.58 6. Taiwan 6.16
7. Esprit Asia Holdings Ltd. (Hong Kong) 1.81 7. Telecommunications (Cellular/ 7. Thailand 4.47
8. Hon Hai Precision Industry Co. Ltd. Wireless) 3.43 8. India 3.76
(Taiwan) 1.80 8. Beverages (Alcoholic) 3.31 9. Indonesia 2.42
9. Videsh Sanchar Nigam Ltd. - GDR (India) 1.79 9. Broadcasting (Television, Radio & 10. New Zealand 1.21
10. Samsung Electronics (South Korea) 1.77 Cable) 3.27
10. Computers (Software and Services) 2.78
The fund's portfolio is subject to change, and there is no assurance that the fund will continue to hold any particular security.
===================================================================================================================================
</TABLE>
See important fund and index disclosures inside front cover.
AIM ASIAN GROWTH FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM ASIAN GROWTH FUND VS. BENCHMARK INDEX
11/3/97-10/31/99
in thousands
================================================================================
MSCI All Country AIM Asian Growth AIM Asian Growth AIM Asian Growth
Asia Free Fund, Class A Fund, Class B Fund, Class C
ex-Japan Index Shares Shares Shares
- --------------------------------------------------------------------------------
11/3/97 10,000 9,432 10,000 10,000
1/31/98 8,811 7,836 8,280 8,290
4/30/98 9,367 8,715 9,200 9,200
7/31/98 7,421 6,682 7,040 7,030
10/31/98 8,110 7,268 7,630 7,610
1/31/99 8,905 7,307 7,670 7,640
4/30/99 11,029 9,140 9,582 9,552
7/31/99 11,713 10,461 10,934 10,914
10/31/99 11,340 10,233 10,263 10,643
Source: Lipper, Inc.
Past performance cannot guarantee comparable future results.
================================================================================
ABOUT THIS CHART
This chart compares your fund's shares to a benchmark index. It is intended to
give you a general idea of how your fund performed compared to this benchmark
over the period 11/3/97- 10/31/99. (Please note that the index's performance
figures are for the period (10/31/97- 10/31/99.) It is important to understand
the differences between your fund and the index. An index measures performance
of a hypothetical portfolio. A market index such as the MSCI All Country Asia
Free ex-Japan Index is not managed, incurring no sales charges, expenses or
fees. If you could buy all the securities that make up a market index, you would
incur expenses that would affect your investment's return.
AVERAGE ANNUAL TOTAL RETURNS
As of 10/31/99, including sales charges
================================================================================
CLASS A SHARES
- --------------------------------------------------------------------------------
Inception (11/3/97) 1.16%
1 year 33.00
CLASS B SHARES
- --------------------------------------------------------------------------------
Inception (11/3/97) 1.31%
1 year 34.76
CLASS C SHARES
- --------------------------------------------------------------------------------
Inception (11/3/97) 3.18%
1 year 38.86
================================================================================
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.
MARKET VOLATILITY CAN SIGNIFICANTLY IMPACT SHORT-TERM PERFORMANCE. RESULTS
OF AN INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM THE HISTORICAL
PERFORMANCE SHOWN.
AIM ASIAN GROWTH FUND
4
<PAGE> 7
SCHEDULE OF INVESTMENTS
October 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOREIGN STOCKS & OTHER EQUITY
INTERESTS-90.31%
AUSTRALIA-13.85%
Austar United Communications Ltd.
(Broadcasting-Television, Radio &
Cable)(a) 51,700 $ 168,195
- --------------------------------------------------------------
Brambles Industries Ltd. (Air
Freight) 25,800 725,790
- --------------------------------------------------------------
BRL Hardy Ltd. (Beverages-Alcoholic) 167,000 729,726
- --------------------------------------------------------------
Computershare Ltd.
(Computers-Software & Services) 196,800 715,571
- --------------------------------------------------------------
ERG Ltd. (Electrical Equipment) 325,000 1,281,222
- --------------------------------------------------------------
Foster's Brewing Group Ltd.
(Beverages-Alcoholic) 255,000 677,986
- --------------------------------------------------------------
James Hardie Industries Ltd.
(Building Materials) 212,000 513,892
- --------------------------------------------------------------
TABCORP Holdings Ltd. (Leisure Time
Products) 87,058 552,011
- --------------------------------------------------------------
Telstra Corp. Ltd. (Telephone) 162,700 522,045
- --------------------------------------------------------------
5,886,438
- --------------------------------------------------------------
HONG KONG-26.33%
ASM Pacific Technology Ltd.
(Machinery-Diversified) 600,000 706,737
- --------------------------------------------------------------
China Telecom Ltd.
(Telecommunications-
Cellular/Wireless)(a) 204,000 697,236
- --------------------------------------------------------------
Cosco Pacific Ltd.
(Financial-Diversified) 630,000 446,055
- --------------------------------------------------------------
Dah Sing Financial Group
(Banks-Regional) 182,800 729,496
- --------------------------------------------------------------
Dao Heng Bank Group Ltd.
(Banks-Regional) 148,500 674,817
- --------------------------------------------------------------
Esprit Asia Holdings Ltd.
(Retail-Stores) 820,000 770,587
- --------------------------------------------------------------
Giordano International Ltd.
(Retail-Specialty-Apparel) 839,500 891,579
- --------------------------------------------------------------
Guangdong Kelon Electrical Holdings
Co. Ltd. (Household Furniture &
Appliances) 446,000 396,159
- --------------------------------------------------------------
HKR International Ltd. (Land
Development) 516,600 392,366
- --------------------------------------------------------------
Hutchison Whampoa Ltd. (Retail-Food
Chains) 74,000 743,039
- --------------------------------------------------------------
Johnson Electric Holdings Ltd.
(Electrical Equipment) 137,000 740,722
- --------------------------------------------------------------
Kerry Properties Ltd. (Land
Development) 441,000 437,134
- --------------------------------------------------------------
Li & Fung Ltd. (Distributors-Food &
Health) 482,000 837,657
- --------------------------------------------------------------
Shenzhen Expressway Co. Ltd.
(Services-Commercial & Consumer) 2,402,000 358,687
- --------------------------------------------------------------
Shui On Construction and Materials
Ltd. (Construction-Cement &
Aggregates) 486,000 675,686
- --------------------------------------------------------------
Television Broadcasts Ltd.
(Broadcasting-Television, Radio &
Cable) 133,000 710,534
- --------------------------------------------------------------
Wing Hang Bank Ltd. (Banks-Major
Regional) 190,500 621,667
- --------------------------------------------------------------
Zhejiang Expressway Co. Ltd.
(Services-Commercial & Consumer) 2,356,000 357,884
- --------------------------------------------------------------
11,188,042
- --------------------------------------------------------------
INDIA-3.76%
ITC Ltd. (Tobacco) 19,600 371,420
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INDIA-(CONTINUED)
Satyam Infoway Ltd.-ADR
(Computers-Software & Services)(a) 12,000 $ 465,000
- --------------------------------------------------------------
Videsh Sanchar Nigam Ltd.-GDR
(Telecommunications-Cellular/Wireless) 47,600 760,410
- --------------------------------------------------------------
1,596,830
- --------------------------------------------------------------
INDONESIA-2.42%
Gulf Indonesia Resources Ltd.
(Oil-International Integrated)(a) 49,700 394,494
- --------------------------------------------------------------
PT Indofood Sukses Makmur Tbk
(Foods)(a) 536,000 633,348
- --------------------------------------------------------------
1,027,842
- --------------------------------------------------------------
NEW ZEALAND-1.21%
Sky Network Television Ltd.
(Broadcasting-Television, Radio,
Cable)(a) 283,000 430,698
- --------------------------------------------------------------
Sky Network Television Ltd.-ADR
(Broadcasting-Television, Radio &
Cable)(a) 5,400 81,675
- --------------------------------------------------------------
512,373
- --------------------------------------------------------------
PHILIPPINES-6.48%
Bank of the Philippine Islands
(Banks-Major Regional) 209,110 552,760
- --------------------------------------------------------------
Equitable PCI Bank (Banks-Major
Regional) 131,350 232,565
- --------------------------------------------------------------
International Container Terminal
Services, Inc. (Air Freight)(a) 2,873,000 275,837
- --------------------------------------------------------------
Jollibee Foods Corp. (Restaurants),
Wts., expiring 03/24/03(b) 1,605,000 610,380
- --------------------------------------------------------------
Manila Electric Co. (Electric Power) 181,300 497,332
- --------------------------------------------------------------
SM Prime Holdings, Inc. (Land
Development) 3,304,900 585,157
- --------------------------------------------------------------
2,754,031
- --------------------------------------------------------------
SINGAPORE-15.43%
Allgreen Properties Ltd.
(Homebuilding)(a) 690,000 585,133
- --------------------------------------------------------------
Datacraft Asia Ltd. (Communications
Equipment) 155,600 715,760
- --------------------------------------------------------------
DBS Group Holdings Ltd. (Banks-Money
Center) 63,127 713,771
- --------------------------------------------------------------
Keppel Corp. Ltd. (Engineering &
Construction) 231,000 627,967
- --------------------------------------------------------------
Keppel Land Ltd. (Land Development) 419,000 592,199
- --------------------------------------------------------------
Natsteel Electronics Ltd.
(Computers-Hardware) 105,500 412,432
- --------------------------------------------------------------
NatSteel Ltd. (Iron & Steel) 396,000 662,104
- --------------------------------------------------------------
OMNI Industries Ltd.
(Electronics-Component Distributors) 625,000 593,913
- --------------------------------------------------------------
Singapore Airlines Ltd. (Airlines) 57,000 603,356
- --------------------------------------------------------------
Singapore Press Holdings Ltd.
(Publishing-Newspapers) 38,000 651,350
- --------------------------------------------------------------
Venture Manufacturing Ltd.
(Electronics-Component Distributors) 45,000 400,553
- --------------------------------------------------------------
6,558,538
- --------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SOUTH KOREA-10.20%
Kookmin Bank (Banks-Major Regional) 52,000 $ 810,671
- --------------------------------------------------------------
Kookmin Bank (Banks-Major Regional),
Rts., expiring 11/04/99 5,223 31,787
- --------------------------------------------------------------
Korea Electric Power Corp.-ADR
(Electric Companies) 37,400 589,050
- --------------------------------------------------------------
Korea Telecom Corp.-ADR
(Telephone)(a) 21,904 772,116
- --------------------------------------------------------------
L.G. Chemical Ltd.
(Chemicals-Specialty) 23,800 720,250
- --------------------------------------------------------------
Pohang Iron & Steel Co. Ltd.-ADR
(Iron & Steel) 19,800 660,825
- --------------------------------------------------------------
Samsung Electronics
(Electronics-Component
Distributors) 4,500 750,313
- --------------------------------------------------------------
4,335,012
- --------------------------------------------------------------
TAIWAN-6.16%
Compal Electronics, Inc.
(Computers-Hardware) 193,550 649,845
- --------------------------------------------------------------
Far Eastern Textile Ltd.
(Chemicals-Diversified) 581,010 794,951
- --------------------------------------------------------------
Hon Hai Precision Industry Co. Ltd.
(Electronics-Component
Distributors)(a) 112,000 766,204
- --------------------------------------------------------------
Ritek Inc. (Consumer-Jewelry,
Novelties & Gifts)(a) 62,000 406,557
- --------------------------------------------------------------
2,617,557
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
THAILAND-4.47%
Advanced Info Service Public Co.
Ltd. (Telephone)(a) 56,000 $ 652,765
- --------------------------------------------------------------
PTT Exploration and Production
Public Co. Ltd. (Oil &
Gas-Exploration & Production) 77,000 562,466
- --------------------------------------------------------------
Siam Commercial Bank PLC, 5.25% Pfd.
(Banks-Regional)(a) 605,000 685,630
- --------------------------------------------------------------
1,900,861
- --------------------------------------------------------------
Total Foreign Stocks & Other
Equity Interests (Cost
$31,193,627) 38,377,524
- --------------------------------------------------------------
MONEY MARKET FUNDS-7.33%
STIC Liquid Assets Portfolio(c) 1,557,615 1,557,615
- --------------------------------------------------------------
STIC Prime Portfolio(c) 1,557,615 1,557,615
- --------------------------------------------------------------
Total Money Market Funds (Cost
$3,115,230) 3,115,230
- --------------------------------------------------------------
TOTAL INVESTMENTS-97.64% 41,492,754
- --------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-2.36% 1,004,345
- --------------------------------------------------------------
NET ASSETS-100.00% $42,497,099
- --------------------------------------------------------------
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
GDR - Global Depositary Receipt
Pfd. - Preferred
Rts. - Rights
Wts. - Warrants
Notes to Schedule of Investments:
(a)Non-income producing security.
(b)Non-income producing security acquired as part of a unit with or in exchange
for other securities.
(c)The security shares the same investment advisor as the Fund.
See Notes to Financial Statements.
6
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$34,308,857) $41,492,754
- -----------------------------------------------------------
Foreign currencies, at value (cost $1,066,940) 1,062,360
- -----------------------------------------------------------
Receivables for:
Investments sold 451,237
- -----------------------------------------------------------
Capital stock sold 434,594
- -----------------------------------------------------------
Dividends and interest 10,643
- -----------------------------------------------------------
Investment for deferred compensation plan 7,658
- -----------------------------------------------------------
Other assets 26,195
- -----------------------------------------------------------
Total assets 43,485,441
- -----------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 754,485
- -----------------------------------------------------------
Capital stock reacquired 101,659
- -----------------------------------------------------------
Deferred compensation 7,658
- -----------------------------------------------------------
Accrued advisory fees 48,172
- -----------------------------------------------------------
Accrued administrative services fees 4,247
- -----------------------------------------------------------
Accrued directors' fees 716
- -----------------------------------------------------------
Accrued distribution fees 22,071
- -----------------------------------------------------------
Accrued transfer agent fees 15,101
- -----------------------------------------------------------
Accrued operating expenses 34,233
- -----------------------------------------------------------
Total liabilities 988,342
- -----------------------------------------------------------
Net assets applicable to shares outstanding $42,497,099
- -----------------------------------------------------------
NET ASSETS:
Class A $25,419,567
- -----------------------------------------------------------
Class B $12,069,543
- -----------------------------------------------------------
Class C $ 5,007,989
- -----------------------------------------------------------
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 2,361,340
- -----------------------------------------------------------
Class B:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 1,133,253
- -----------------------------------------------------------
Class C:
Authorized 200,000,000
- -----------------------------------------------------------
Outstanding 471,104
- -----------------------------------------------------------
Class A:
Net asset value and redemption price per
share $ 10.76
- -----------------------------------------------------------
Offering price per share:
(Net asset value of $10.76
divided by 94.50%) $ 11.39
- -----------------------------------------------------------
Class B:
Net asset value and offering price per share $ 10.65
- -----------------------------------------------------------
Class C:
Net asset value and offering price per share $ 10.63
- -----------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
For the year ended October 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $99,541 foreign withholding
tax) $ 302,917
- -----------------------------------------------------------
Interest 65,008
- -----------------------------------------------------------
Total investment income 367,925
- -----------------------------------------------------------
EXPENSES:
Advisory fees 246,413
- -----------------------------------------------------------
Administrative services fees 74,007
- -----------------------------------------------------------
Custodian fees 62,478
- -----------------------------------------------------------
Directors' fees 7,780
- -----------------------------------------------------------
Distribution fees-Class A 61,006
- -----------------------------------------------------------
Distribution fees-Class B 64,087
- -----------------------------------------------------------
Distribution fees-Class C 20,619
- -----------------------------------------------------------
Transfer agent fees-Class A 61,457
- -----------------------------------------------------------
Transfer agent fees-Class B 36,637
- -----------------------------------------------------------
Transfer agent fees-Class C 11,787
- -----------------------------------------------------------
Registration and filing fees 61,091
- -----------------------------------------------------------
Other 71,023
- -----------------------------------------------------------
Total expenses 778,385
- -----------------------------------------------------------
Less: Fees waived and reimbursed by advisor (207,130)
- -----------------------------------------------------------
Expenses paid indirectly (853)
- -----------------------------------------------------------
Net expenses 570,402
- -----------------------------------------------------------
Net investment income (loss) (202,477)
- -----------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENT
SECURITIES AND FOREIGN CURRENCIES:
Net realized gain (loss) from:
Investment securities 935,968
- -----------------------------------------------------------
Foreign currencies (9,786)
- -----------------------------------------------------------
926,182
- -----------------------------------------------------------
Change in net unrealized appreciation of:
Investment securities 6,895,666
- -----------------------------------------------------------
Foreign currencies 1,173
- -----------------------------------------------------------
6,896,839
- -----------------------------------------------------------
Net gain from investment securities and
foreign currencies 7,823,021
- -----------------------------------------------------------
Net increase in net assets resulting from
operations $7,620,544
- -----------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
7
<PAGE> 10
STATEMENT OF CHANGES IN NET ASSETS
For the year ended October 31, 1999 and the period November 3, 1997 (date
operations commenced)
through October 31, 1998
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (202,477) $ 30,244
- -----------------------------------------------------------------------------------------
Net realized gain (loss) from investment securities and
foreign currencies 926,182 (1,687,076)
- -----------------------------------------------------------------------------------------
Change in net unrealized appreciation of investment
securities and foreign currencies 6,896,839 288,673
- -----------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations 7,620,544 (1,368,159)
- -----------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A (43,024) --
- -----------------------------------------------------------------------------------------
Class B (3,910) --
- -----------------------------------------------------------------------------------------
Class C (898) --
- -----------------------------------------------------------------------------------------
Share transactions-net:
Class A 12,107,278 8,755,042
- -----------------------------------------------------------------------------------------
Class B 7,604,535 3,340,169
- -----------------------------------------------------------------------------------------
Class C 3,780,454 705,068
- -----------------------------------------------------------------------------------------
Net increase in net assets 31,064,979 11,432,120
- -----------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 11,432,120 --
- -----------------------------------------------------------------------------------------
End of period $42,497,099 $11,432,120
- -----------------------------------------------------------------------------------------
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $36,066,914 $12,781,818
- -----------------------------------------------------------------------------------------
Undistributed net investment income (loss) (7,889) 45,035
- -----------------------------------------------------------------------------------------
Undistributed net realized (loss) from investment
securities and foreign currencies (747,438) (1,683,406)
- -----------------------------------------------------------------------------------------
Unrealized appreciation of investment securities and
foreign currencies 7,185,512 288,673
- -----------------------------------------------------------------------------------------
$42,497,099 $11,432,120
- -----------------------------------------------------------------------------------------
</TABLE>
NOTES TO FINANCIAL STATEMENTS
October 31, 1999
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. 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 will
be 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 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 the 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 its last sales price on the exchange where
the security is principally traded, or lacking any sales on a particular day,
the security is valued at the closing bid price on that day. Each security
reported on the NASDAQ National Market System is valued at the last sales
price on the valuation date or absent a last sales price, at the closing bid
price. 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 prices are not
provided by any of the above methods are valued based upon quotes furnished
by independent sources and are
8
<PAGE> 11
valued at the last bid price in the case of equity securities and in the case
of debt obligations, the mean between the last bid and asked prices.
Securities for which market quotations are 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 of the Company. Short-term obligations having 60
days or less to maturity are valued at amortized cost which approximates
market value. For purposes of determining net asset value per share, futures
and options contracts generally will be valued 15 minutes after the close of
trading of the New York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed each day
at various times prior to the close of the NYSE. 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 NYSE. 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 NYSE 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. Securities Transactions, Investment Income and Distributions -- Securities
transactions are accounted for on a trade date basis. Realized gains or
losses on sales 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 the accrual basis. Dividend income is recorded on the
ex-dividend date. The Fund may elect to use a portion of the proceeds of
capital stock redemptions as distributions for Federal income tax purposes.
Distributions from income and net realized capital gains, if any, are
generally paid annually and recorded on ex-dividend date.
On October 31, 1999, undistributed net investment income was increased by
$197,385, undistributed net realized gains increased by $9,786 and paid-in
capital decreased $207,171 as a result of differing book/tax treatment of
foreign currency transactions and net operating loss reclassifications 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 reclassification discussed above.
C. 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 $350,698 as of October 31, 1999 which may be carried forward
to offset future taxable gains, if any, which expires, if not previously
utilized, in the year 2006.
D. 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. The Fund does
not separately account for that portion of the results of operations
resulting from changes in foreign exchange rates on investments and the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss
from investments.
E. 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.
F. Expenses -- Distribution expenses 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 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, plus 0.175% of the Fund's
average daily net assets in excess of $500 million. During the year ended
October 31, 1999, AIM waived fees of $207,130.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to pay AIM for certain administrative costs incurred in providing
accounting services to the Fund. During the year ended October 31, 1999, AIM was
paid $74,007 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency and
shareholder services to the Fund. During the year ended October 31, 1999, AFS
was paid $64,165 for such services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B and Class C shares of the Fund. The Company has adopted a plan
pursuant to Rule 12b-1 under
9
<PAGE> 12
the 1940 Act with respect to the Fund's Class A shares, Class B shares and Class
C shares (collectively the "Plans"). The Fund, pursuant to the Plans, pays AIM
Distributors compensation at the annual rate of 0.35% of the Fund's average
daily net assets of Class A shares and 1.00% of the average daily net assets of
Class B and C shares. Of these amounts, the Fund may pay a service fee of 0.25%
of the average daily net assets of the Class A, Class B or Class 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 year ended October 31, 1999, the Class A,
Class B and Class C shares paid AIM Distributors $61,006, $64,087 and $20,619,
respectively, as compensation under the Plans.
AIM Distributors received commissions of $43,007 from sales of the Class A
shares of the Fund during the year ended October 31, 1999. 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, 1999,
AIM Distributors received $240,319 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, 1999, the Fund paid legal fees of $3,540 for
services rendered by Kramer, Levin, Naftalis & Frankel LLP as counsel to the
Company's directors. A member of that firm is a director of the Company.
NOTE 3-INDIRECT EXPENSES
During the year ended October 31, 1999, the Fund received reductions in transfer
agency fees from AFS (an affiliate of AIM) and reductions in custodian fees of
$339 and $514, respectively, under expense offset arrangements. The effect of
the above arrangements resulted in a reduction of the Fund's total expenses of
$853 during the year ended October 31, 1999.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid to directors who are not an
"interested person" of AIM. The Company invests 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) 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. During the year
ended October 31, 1999, 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 0.09% on the unused balance of the committed line. Prior to
May 28, 1999, the commitment fee rate was 0.05%. 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, 1999 was
$53,369,215 and $31,161,990, respectively.
The amount of unrealized appreciation (depreciation) of investment securities
as of October 31, 1999 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $ 7,981,120
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (1,193,961)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $ 6,787,159
- ---------------------------------------------------------
Cost of investments for tax purposes is $34,705,595.
</TABLE>
10
<PAGE> 13
NOTE 7-CAPITAL STOCK
Changes in capital stock outstanding during the years ended October 31, 1999 and
1998 were as follows:
<TABLE>
<CAPTION>
1999 1998
------------------------- -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Sold:
Class A 7,418,728 $ 73,010,343 2,150,231 $ 17,226,640
- -------------------------------------------------------------------------------------------------------------------
Class B 1,590,485 15,858,499 516,509 4,177,886
- -------------------------------------------------------------------------------------------------------------------
Class C 1,155,486 11,034,900 268,694 2,084,897
- -------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class A 5,228 39,837 -- --
- -------------------------------------------------------------------------------------------------------------------
Class B 494 3,756 -- --
- -------------------------------------------------------------------------------------------------------------------
Class C 118 897 -- --
- -------------------------------------------------------------------------------------------------------------------
Reacquired:
Class A (6,066,544) (60,942,902) (1,146,303) (8,471,598)
- -------------------------------------------------------------------------------------------------------------------
Class B (854,740) (8,257,720) (119,495) (837,717)
- -------------------------------------------------------------------------------------------------------------------
Class C (774,549) (7,255,343) (178,645) (1,379,829)
- -------------------------------------------------------------------------------------------------------------------
2,474,706 $ 23,492,267 1,490,991 $ 12,800,279
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE 8-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A, Class B and
Class C capital stock outstanding for the year ended October 31, 1999 and the
period November 3, 1997 (date operations commenced) through October 31, 1998.
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
------------------- ------------------- -------------------
1999(A) 1998 1999(A) 1998 1999(A) 1998
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 7.69 $ 10.00 $ 7.63 $ 10.00 $ 7.61 $ 10.00
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Income from investment operations:
Net investment income (loss) (0.03) 0.05 (0.13) (0.01) (0.13) (0.01)
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Net gains (losses) on securities (both realized and
unrealized) 3.14 (2.36) 3.16 (2.36) 3.16 (2.38)
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Total from investment operations 3.11 (2.31) 3.03 (2.37) 3.03 (2.39)
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Less distributions:
Dividends from net investment income (0.04) -- (0.01) -- (0.01) --
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Net asset value, end of period $10.76 $ 7.69 $10.65 $ 7.63 $10.63 $ 7.61
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Total return(b) 40.66% (23.10)% 39.76% (23.70)% 39.86% (23.90)%
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Ratios/supplemental data:
Net assets, end of period (000s omitted) $25,420 $ 7,716 $12,070 $ 3,030 $5,008 $ 686
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Ratio of expenses to average net assets(c) 1.92%(d) 1.92%(e) 2.79%(d) 2.80%(e) 2.79%(d) 2.80%(e)
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Ratio of net investment income (loss) to average net
assets(f) (0.50)%(d) 0.70%(e) (1.37)%(d) (0.18)%(e) (1.37)%(d) (0.18)%(e)
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
Portfolio turnover rate 142% 79% 142% 79% 142% 79%
- ---------------------------------------------------------- ------- ------- ------- ------- ------ -------
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct sales charges and is not annualized for periods less than
one year.
(c) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
2.72% and 4.88% (annualized) for Class A for 1999-1998, 3.59% (annualized)
and 5.75% (annualized) for Class B for 1999-1998; and 3.59% (annualized) and
5.75% (annualized) for Class C for 1999-1998.
(d) Ratios are based on average net assets of $17,430,236, $6,408,688 and
$2,061,860 for Class A, Class B and Class C, respectively.
(e) Annualized.
(f) 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 (1.30)% and (2.27)% (annualized) for Class A for
1999-1998, (2.17)% and (3.15)% (annualized) for Class B for 1999-1998,
(2.17)% and (3.15)% (annualized) for Class C for 1999-1998.
11
<PAGE> 14
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, 1999, the related statement
of operations for the year then ended, the statement of
changes in net assets and financial highlights for the year
then ended and 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, 1999, 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, 1999, the results of its
operations for the year then ended, changes in its net
assets and financial highlights for the year then ended and
the period November 3, 1997 (date operations commenced)
through October 31, 1998, in conformity with generally
accepted accounting principles.
KPMG LLP
December 3, 1999
Houston, Texas
12
<PAGE> 15
<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; Carol F. Relihan A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Secretary 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Gary T. Crum Houston, TX 77046
Senior Vice President
Owen Daly II SUB-ADVISOR
Director Dana R. Sutton
Cortland Trust Inc. Vice President and Treasurer INVESCO Global Asset Management Limited
Cedar House
Edward K. Dunn Jr. Robert G. Alley 41 Cedar Avenue
Chairman, Mercantile Mortgage Corp.; Vice President Hamilton, HM12 Bermuda
Formerly Vice Chairman and President,
Mercantile-Safe Deposit & Trust Co.; and Melville B. Cox TRANSFER AGENT
President, Mercantile Bankshares Vice President
A I M Fund Services, Inc.
Jack Fields Edgar M. Larsen P.O. Box 4739
Chief Executive Officer Vice President Houston, TX 77210-4739
Texana Global, Inc.;
Formerly Member Mary J. Benson CUSTODIAN
of the U.S. House of Representatives Assistant Vice President and
Assistant Treasurer State Street Bank and Trust Company
Carl Frischling 225 Franklin Street
Partner Sheri Morris Boston MA 02110
Kramer, Levin, Naftalis & Frankel LLP Assistant Vice President and
Assistant Treasurer COUNSEL TO THE FUND
Robert H. Graham
President and Chief Executive Officer Renee A. Friedli Ballard Spahr
A I M Management Group Inc. Assistant Secretary Andrews & Ingersoll, LLP
1735 Market Street
Prema Mathai-Davis P. Michelle Grace Philadelphia, PA 19103
Chief Executive Officer, YWCA of the U.S.A.; Assistant Secretary
Commissioner, New York City Dept. for the COUNSEL TO THE DIRECTORS
Aging; and member of the Board of Directors, Nancy L. Martin
Metropolitan Transportation Authority of Assistant Secretary Kramer, Levin, Naftalis & Frankel LLP
New York State 919 Third Avenue
Ofelia M. Mayo New York, NY 10022
Lewis F. Pennock Assistant Secretary
Attorney DISTRIBUTOR
Lisa A. Moss
Louis S. Sklar Assistant Secretary A I M Distributors, Inc.
Executive Vice President 11 Greenway Plaza
Hines Interests Kathleen J. Pflueger Suite 100
Limited Partnership Assistant Secretary Houston, TX 77046
Samuel D. Sirko AUDITORS
Assistant Secretary
KPMG LLP
Stephen I. Winer 700 Louisiana
Assistant Secretary Houston, TX 77002
</TABLE>
REQUIRED FEDERAL INCOME TAX INFORMATION
AIM Asian Growth Fund paid ordinary dividends in the amount of $0.0400 per share
to Class A shareholders and $0.0095 to Class B and Class C shareholders during
the Fund's tax year ended October 31, 1999. Of these amounts, 0% is eligible for
the dividends received deduction for corporations.
<PAGE> 16
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc. has provided
AIM Aggressive Growth Fund(1) AIM Money Market Fund leadership in the mutual fund industry
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund since 1976 and managed approximately
AIM Capital Development Fund $120 billion in assets for more than 6.4
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS million shareholders, including
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund individual investors, corporate clients
AIM Large Cap Growth Fund AIM Asian Growth Fund and financial institutions, as of
AIM Mid Cap Equity Fund AIM Developing Markets Fund September 30, 1999.
AIM Mid Cap Growth Fund AIM Euroland Growth Fund(4) The AIM Family of Funds--Registered
AIM Mid Cap Opportunities Fund AIM European Development Fund Trademark-- is distributed nationwide,
AIM Select Growth Fund AIM International Equity Fund and AIM today is the 10th-largest mutual
AIM Small Cap Growth Fund(2) AIM Japan Growth Fund fund complex in the United States in
AIM Small Cap Opportunities Fund(3) AIM Latin American Growth Fund assets under management, according to
AIM Value Fund AIM New Pacific Growth Fund Strategic Insight, an independent mutual
AIM Weingarten Fund fund monitor.
GLOBAL GROWTH FUNDS
GROWTH & INCOME FUNDS AIM Global Aggressive Growth Fund
AIM Advisor Flex Fund AIM Global Growth Fund
AIM Advisor Large Cap Value Fund
AIM Advisor Real Estate Fund GLOBAL GROWTH & INCOME FUNDS
AIM Balanced Fund AIM Global Growth & Income Fund
AIM Basic Value Fund AIM Global Utilities Fund
AIM Charter Fund
GLOBAL INCOME FUNDS
INCOME FUNDS AIM Emerging Markets Debt Fund
AIM Floating Rate Fund AIM Global Government Income Fund
AIM High Yield Fund AIM Global Income Fund
AIM High Yield Fund II AIM Strategic Income Fund
AIM Income Fund
AIM Intermediate Government Fund THEME FUNDS
AIM Limited Maturity Treasury Fund AIM Global Consumer Products and Services Fund
AIM Global Financial Services Fund
TAX-FREE INCOME FUNDS AIM Global Health Care Fund
AIM High Income Municipal Fund AIM Global Infrastructure Fund
AIM Municipal Bond Fund AIM Global Resources Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Telecommunications and Technology Fund(5)
AIM Tax-Free Intermediate Fund AIM Global Trends Fund(6)
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(1)AIM Aggressive Growth Fund reopened to new investors on November 16, 1998.
(2)AIM Small Cap Growth Fund closed to new investors on November 8, 1999. (3)AIM
Small Cap Opportunities Fund closed to new investors on November 4, 1999. (4)On
September 1, 1999, AIM Europe Growth Fund was renamed AIM Euroland Growth Fund.
Previously the fund invested in all size companies in most areas of Europe. The
fund now seeks to invest at least 65%of its assets in large-cap companies within
countries using the euro as their currency (EMU-member countries). (5)On June 1,
1999, AIM Global Telecommunications Fund was renamed AIM Global
Telecommunications and Technology Fund. (6)Effective August 27, 1999, AIM Global
Trends Fund was restructured to operate as a traditional mutual fund. Before
that date, the fund operated as a fund of funds. For more complete information
about any AIM fund(s), including sales charges and expenses, ask your financial
advisor or securities dealer for a free prospectus(es). Please read the
prospectus(es) carefully before you invest or send money. If used as sales
material after January 20, 2000, this report must be accompanied by a current
Quarterly Review of Performance for AIM Funds.
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