KNOWLEDGE DISCIPLINE SERVICE CHOICE
- --------------------------------------------------------------------------------
YOU SHOULD KNOW WHAT INVESCO KNOWS (TM)
INVESCO International Funds, Inc.
EUROPEAN
INTERNATIONAL BLUE CHIP
PACIFIC BASIN
[INVESCO ICON]
INVESCO
SEMIANNUAL REPORT / April 30, 1999
<PAGE>
"IN A 'POST-CRISIS' WORLD, WE BELIEVE THE BEST OPPORTUNITIES LIE WITH
ATTRACTIVELY PRICED COMPANIES THAT WILL PROFIT FROM BUSINESS AS USUAL." (PAGE 3)
"PERIODICALLY, THE EUROPEAN MARKETS--AND THE ECONOMIES THEY TRACK--ARE MOST
NOTABLE FOR THEIR UNFULFILLED POTENTIAL." (PAGE 4)
Graph: INVESCO Pacific Basin Fund 10-Year Total Return
vs. MSCI - Pacific
This line graph compares the value of a $10,000 investment in INVESCO
Pacific Basin Fund to the value of a $10,000 investment in the MSCI -
Pacific Index, assuming in each case reinvestment of all dividends and
capital gain distributions, for the 10-year period ended 4/30/99.
Graph: INVESCO International Blue Chip Fund Total Return from Inception
(10/98)vs. MSCI - Europe/Australia/Far East
This line graph compares the value of a $10,000 investment in INVESCO
International Blue Chip Fund to the value of a $10,000 investment in the
MSCI - Europe/Australia/Far East Index, assuming in each case reinvestment
of all dividends and capital gain distributions, for the period from
inception (10/98) through 4/30/99.
Graph: INVESCO European Fund 10-Year Total Return
vs. MSCI - Europe
This line graph compares the value of a $10,000 investment in INVESCO
European Fund to the value of a $10,000 investment in the MSCI - Europe
Index, assuming in each case reinvestment of all dividends and capital
gain distributions, for the 10-year period ended 4/30/99.
INVESCO INTERNATIONAL FUNDS, INC.
TOTAL RETURN,
PERIODS ENDED 4/30/99 (1)
FUND 6 MONTHS 1 YEAR 5 YEARS* 10 YEARS* PAGE NUMBER
EUROPEAN 4.85% -3.25% 15.70% 11.96% 4
PACIFIC BASIN 21.68% 2.14% -8.24% -2.47% 5
------------------------------------------------------
INTERNATIONAL BLUE
CHIP 5.90% (cumulative since inception 10/28/98) 3
* AVERAGE ANNUALIZED
The line graphs illustrate the value of a $10,000 investment, plus
reinvested dividends and capital gain distributions, for the 10-year period
ended 4/30/99. The chart and other total return figures cited reflect the fund's
operating expenses, but the indexes do not have expenses, which would, of
course, have lowered their performance. (Of course, past performance is not a
guarantee of future results.)(1),(2) In order to provide a better comparison to
European Fund, we will be replacing the MSCI-AC Europe Index with the MSCI
Europe Index.
<PAGE>
INTERNATIONAL BLUE CHIP FUND
Your Fund's Performance: A Report from the Manager
- --------------------------------------------------------------------------------
Dear Shareholder:
If one thinks of the international markets as the surface of a pool, waves are
still rocking up against the sides from the large splash caused by last year's
financial turmoil. In this still-turbulent environment, it has been more
difficult than we had hoped to identify the countries and industries that would
first see the returning calm.
Since the fund's introduction last autumn, it has achieved a positive
return--although we certainly aim for better things in the future. Since the
fund's inception in October 1998, it has had a cumulative total return of 5.90%.
This lagged the return of the MSCI-EAFE Index over the same period, which rose
15.44%. (Of course, past performance is not a guarantee of future results.)(1),
(2)
Two characteristics of the recovery of world markets took us by surprise,
although we correctly anticipated others. First, our emphasis on European stocks
was not as helpful to the fund as it might have been late last year, because of
the surprising weakness of the new euro, which reduced returns in dollar terms.
Many economists had wondered if the euro might appreciate after its
introduction, given that it poses a new option as a reserve currency to
challenge the dollar--but in fact the opposite occurred. While our emphasis on
European shares--particularly those in cyclical industries--helped returns early
this year, the real action on world markets was in Japan. Anticipating that the
slumbering giant that is the Japanese economy would soon reawaken, investors bid
up the Japanese markets dramatically. While we have some investments in Japanese
firms, we have generally kept our exposure to the country low. We continue to
worry about the very profound structural problems faced by the Japanese economy,
and particularly its banking sector. In our mind, much of the recent upswing on
the Japanese market has been the result of wishful thinking, rather than a
response to real improvements.
We feel no need to make wagers on such turnarounds, in part because of the
plenitude of attractively priced, globally competitive companies. Low interest
rates, improving consumer sentiment, and stabilizing economies should help these
firms as we go forward. In a "post-financial crisis" world, we believe the best
opportunities lie with attractively priced companies that will profit from
business as usual.
- --------------------------------------------------------------------------------
FUND MANAGEMENT
JOHN ROGERS, CFA
JOHN ROGERS LEADS THE PORTFOLIO MANAGEMENT TEAM FOR INTERNATIONAL BLUE CHIP
FUND. JOHN SERVES AS THE CHIEF EXECUTIVE OFFICER AND CHIEF INVESTMENT OFFICER
FOR INVESCO'S GLOBAL INVESTMENT MANAGEMENT COMPANY IN THE UNITED STATES. HE HAS
A BA IN HISTORY FROM YALE UNIVERSITY AND A MA IN EAST ASIAN STUDIES FROM
STANFORD UNIVERSITY.
<PAGE>
EUROPEAN FUND
Your Fund's Performance: A Report from the Manager
- --------------------------------------------------------------------------------
Dear Shareholder:
Periodically, the European markets--and the economies they track--are most
notable for their unfulfilled potential. This has certainly been the case
recently, as slowing economic growth and worries over the future have muted
investors' enthusiasm for the European markets--and seemingly better growth
prospects elsewhere have led to capital leaving the region. Despite the slow
growth in Europe it has been the economically sensitive stocks that have
outperformed on expectations that they will benefit most from the higher global
growth prospects. This preference for cyclical companies and other traditional
sectors instead of growth stocks curbed the Fund's performance.
For the six months ended April 30, 1999 the value of your shares rose
4.85%. This lagged the return of the MSCI-Europe over the same period, which
rose 10.98%. (Of course, past performance is not a guarantee of future
results.)(1),(2)
These returns were disappointing. We believed that investors in European markets
would take a view more similar to those investing in American markets and
continue to reward the fastest-growing companies in leading industries. Most
recently though investors have focused instead on companies appeared poised to
benefit from improving export markets and a pick-up in global commodity
prices--as has begun to happen in the American market.
We continue to look differently at the underlying trends of the European
economies. Many have seen the possibility of renewed inflation in the economic
turnaround, which has had a negative effect on bond prices. Inflationary
expectations also hurt the growth companies that we target, as it causes
investors to place less value on future earnings.
In contrast, although we recognize the possibility of periodic bouts of
inflation, we tend to think that technological change, globalization and
increased pricing transparency following the launch of the Euro will help keep
inflation in check--that factors similar to those driving the economy in the
United States will work in Europe as well. The number of individuals buying
personal computers for the home to connect to the Internet, for example,
suggests that European companies will track the American technology boom of the
1990s. We are seeking to find the companies that are seizing these unveiling
technological opportunities, as well as those that are poised to benefit from
tighter economic integration on the continent. A long standing area of focus for
us has been wireless communications, an area of technological change where
Europe leads the United States. We are also interested in business service
companies, and those involved in media, entertainment, and retailing.
Along with technology, deregulation, and economic integration, the other
900-pound gorilla in the European markets is the demand for equities. Last year
saw a record level of flows into equity mutual funds from European private
investors. Unfortunately, the ill-timed financial crisis late last year caused
these flows to slow markedly. Nonetheless, we are convinced that an "equity
culture" is only in its embryonic stages in Europe, with plenty of dynamic
growth opportunities ahead.
In sum, our somewhat disappointing performance recently has not altered our
fundamental faith in both the European markets and a growth investing strategy.
- --------------------------------------------------------------------------------
FUND MANAGEMENT
STEVEN CHAMBERLAIN
STEVEN CHAMBERLAIN IS THE LEAD MANAGER FOR EUROPEAN FUND. HE HOLDS A BSC DEGREE
IN GEOLOGY FROM KINGSTON POLYTECHNIC AND HAS EXPERIENCE IN EQUITIES AND CURRENCY
TRADING. HE JOINED INVESCO IN 1987.
<PAGE>
PACIFIC BASIN FUND
Your Fund's Performance: A Report from the Manager
- --------------------------------------------------------------------------------
Dear Shareholder:
Compared to the nightmarish visions floated by some late last year, this has
been an encouraging six months in the Far Eastern markets. Certain markets,
particularly those in Malaysia and Singapore, have surged in recent months due
to renewed confidence. Yet compared to the highly optimistic environment that
surrounded some Asian markets a few years ago, the region still has far to go.
For the six months ended April 30, 1999 the value of your shares rose 21.68%.
This lagged the return of the MSCI Pacific IX GD Index over the same period,
which rose 27.67%. (Of course, past performance is not a guarantee of future
results.)(1),(2)
For all its problems, Japan remains an important driver of the Pacific Basin's
economy. While the Japanese "economic miracle" helped spread affluence around
the region--particularly in the 1980s and early 1990s--its influence has been
much more ambiguous of late. With its banking system in disarray, Japan has been
in no position to provide credit to the region's smaller, growing economies.
Recently, Asian markets showed their ability to shrug off liquidity concerns in
Japan and concentrate instead on positive developments domestically. Still, the
strength of the recovery in the region will be affected to some extent by Japan.
Thus, the state of the Japanese economy poses an acute question for investors.
We are encouraged that the recession there seems to be moderating, and we
believe that the country will soon see positive growth. Consumer sentiment
appears to be improving and industrial production may be picking up. On the
other hand, while many investors have reacted strongly to the announcement of
government stimulus packages, we have taken a more cautious stance while
awaiting their implementation. This has led us to place relatively less emphasis
on Japan, preventing us from fully participating in the recent--and in our
opinion, premature--rally.
With its huge population and high growth rate, China becomes more of a factor in
Far Eastern markets each year. Unfortunately, the Chinese economy has also
slowed, and it is now wrestling with a deflationary environment. Thus we have
also minimized our exposure to this huge area (including Hong Kong) --while
keeping in mind the longer-term potential it presents.
With varying degrees of success, the rest of the region's economies have made
some progress in recovering from the severe economic crisis. Some countries,
such as South Korea and Singapore, have been remarkably successful in reviving
investor sentiment through a combination of improving current accounts, falling
interest rates, and real reforms. Meanwhile, Australia has continued to enjoy
robust consumption and a healthy banking system, making it the relative safe
haven last year. We have concentrated our investments in those nations that have
seemed the best prepared for recovery.
Across the region, our focus will remain on those companies taking the
tough steps necessary to restructure and become more competitive
internationally. The Pacific Basin remains the home of many of the world's
leading companies, and it enjoys one of its lower-cost, highest-quality
workforces. Should the political and financial environments in which these firms
operate improve, we are optimistic that investors will once again profit from
the potential.
- --------------------------------------------------------------------------------
FUND MANAGEMENT
ANNA TONG
ANNA TONG LEADS THE MANAGEMENT TEAM FOR PACIFIC BASIN FUND AND SERVES AS DEPUTY
MANAGING DIRECTOR AND CHIEF INVESTMENT OFFICER OF INVESCO ASIA. SHE HAS A BS IN
ACCOUNTING AND A MBA FROM THE UNIVERSITY OF CALIFORNIA AT BERKELEY.
<PAGE>
INVESCO / Semiannual Report / April 30, 1999
Market Headlines: November 1998 to April 1999
- --------------------------------------------------------------------------------
If the winter of 1997-1998 taught investors one lesson, it was never to count a
good economy down. Low interest rates, strong consumer spending and wage growth,
and a virtually non-existent inflation rate combined to guide American markets
out of the storms of world financial crisis. To be sure, troublesome indicators
remained: a ballooning trade deficit, sluggish earnings growth for many large
international companies, and a worrisomely low personal savings rate. Overall,
though, the American economy was as robust as it had been in decades. Were we
reaping the bounty of a "new economy," optimists wondered?
If we were, unfortunately, the rest of the world appeared trapped in more
somber economic realities. Growth in Western Europe began to slow as its
companies suffered from declining exports to emerging markets. Japan and the
rest of Asia began crawling out of the hole of financial despair--but while
Asian markets reacted exuberantly, it was clear that the region had far to go.
In Latin America, markets plunged following a new currency crisis in Brazil
before recovering in February.
The world economy could not continue flying on one engine, American
financial officials warned their global counterparts. Indeed, the question
remained: Would the world join in American prosperity, or would the world's
largest economy finally fall prey to slower growth? As new market records were
achieved in April, however, more investors seemed to look forward to smooth
flying.
SINCE THE FUNDS ARE ACTIVELY MANAGED, HOLDINGS WILL CHANGE OVER TIME.
(1)TOTAL RETURN ASSUMES REINVESTMENT OF DIVIDENDS AND CAPITAL GAIN
DISTRIBUTIONS FOR THE PERIODS INDICATED. PAST PERFORMANCE IS NOT A GUARANTEE OF
FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT,
WHEN REDEEMED, AN INVESTOR'S SHARES MAY BE WORTH MORE OR LESS THAN WHEN
PURCHASED.
(2)THE MSCI-EAFE, MSCI-AC EUROPE, MSCI-EUROPE AND MSCI-PACIFIC ARE
UNMANAGED INDEX OF COMMON STOCKS CONSIDERED REPRESENTATIVE OF THE OVERALL
INTERNATIONAL, EUROPEAN, AND PACIFIC BASIN SECURITIES MARKETS, RESPECTIVELY.
<PAGE>
TEN LARGEST COMMON STOCK HOLDINGS
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
APRIL 30, 1999
UNAUDITED
DESCRIPTION VALUE
- --------------------------------------------------------------------------------
EUROPEAN FUND
Vodafone Group PLC $ 18,620,002
Nokia Oyj 16,979,842
Tomra Systems A/S A 16,378,781
MobilCom AG 15,408,980
Sage Group PLC 15,215,445
EM.TV & Merchandising AG 13,730,195
Orange PLC 13,670,088
Equant NV 13,632,330
Skandia Forsakrings AB 13,565,569
Carrefour SA 13,489,500
INTERNATIONAL BLUE CHIP FUND
Den Danske Bank Group $ 692,426
ING Groep NV 616,814
National Australia Bank Ltd 584,987
HSBC Holdings PLC 564,662
Repsol SA Sponsored ADR Representing Ord Shrs 561,000
Novartis AG Registered Shrs 550,000
Societe Generale Series A Shrs 537,676
Telecom Italia SpA Sponsored ADR Representing 10 Ord Shrs 530,938
Unilever NV New York Registered Shrs 519,500
Koninklijke Philips Electronics NV New York Registered
Shrs Representing Ord Shrs 512,250
PACIFIC BASIN FUND
Takeda Chemical Industries Ltd $ 3,739,287
NTT Mobile Communication Network 3,577,263
Fujitsu Ltd 3,220,877
Shohkoh Fund & Co Ltd 2,785,574
Secom Co Ltd 2,735,140
Nippon Telegraph & Telephone 2,374,230
Bridgestone Corp 2,251,916
Toyota Motor 2,016,420
Taisho Pharmaceutical Ltd 1,967,746
National Australia Bank Ltd 1,949,958
Composition of holdings is subject to change.
<PAGE>
STATEMENT OF INVESTMENT SECURITIES
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
APRIL 30, 1999
UNAUDITED
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
EUROPEAN FUND
94.69 COMMON STOCKS, RIGHTS & WARRANTS
6.36 FINLAND
Helsingin Puhelin Oyj Series E Shrs TN 175,000 $ 7,387,485
Nokia Oyj CM 220,000 16,979,842
Raisio Group PLC FD 550,000 5,033,435
Tieto Corp Series B Shrs CO 200,000 7,977,320
================================================================================
37,378,082
14.61 FRANCE
Altran Technologies SA EC 45,000 10,712,250
AXA IN 75,000 9,696,570
Cap Gemini SA CO 40,000 6,123,704
Carrefour SA RT 17,000 13,489,500
Dassault Systemes SA CO 202,100 7,447,413
France Telecom SA TL 60,000 4,853,046
PSA Peugeot Citroen AM 40,000 6,644,240
Pinault-Printemps-Redoute SA RT 45,000 7,474,770
Sanofi SA HD 70,000 10,983,098
Sidel SA MY 70,000 8,442,840
================================================================================
85,867,431
10.15 GERMANY
DaimlerChrysler AG Registered Shrs(a) AM 115,625 11,431,855
EM.TV & Merchandising AG BR 14,500 13,730,195
HypoVereinsbank BK 90,000 5,875,074
Mannesmann AG MY 100,000 13,182,680
MobilCom AG TC 60,735 15,408,980
================================================================================
59,628,784
0.65 GREECE
Panafon Hellanic Telecom SA(a) TC 42,572 1,137,008
STET Hellas Telecommunications SA ADR
Representing Ord Shrs(a) TL 100,000 2,700,000
================================================================================
3,837,008
3.41 IRELAND
Bank of Ireland PLC BK 400,000 8,005,417
CBT Group PLC Sponsored ADR
Representing Ord Shrs(a) CO 300,000 4,650,000
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
Esat Telecom Group PLC Sponsored
ADR Representing 2 Ord Shrs(a) TL 151,400 $ 7,399,675
================================================================================
20,055,092
5.00 ITALY
Assicurazioni Generali IN 200,000 7,797,460
Autogrill SpA RS 900,000 8,265,096
Telecom Italia Mobile SpA Savings Shrs TC 1,700,000 5,701,562
Unicredito Italiano SpA BK 1,500,000 7,617,600
================================================================================
29,381,718
0.74 LUXEMBOURG
Safra Republic Holdings SA IV 100,000 4,350,000
================================================================================
7.31 NETHERLANDS
Equant NV(a) CO 150,000 13,632,330
ING Groep NV BK 50,000 3,084,070
Koninklijke Numico NV FD 200,000 7,532,960
TNT Post Group NV AF 498,956 13,461,334
Wolters Kluwer NV PB 120,000 5,230,752
================================================================================
42,941,446
2.79 NORWAY
Tomra Systems A/S A PC 411,398 16,378,781
================================================================================
1.38 PORTUGAL
Banco Comercial Portugues SA
Registered Shrs BK 219,497 6,198,161
M Accoes Portugal Closed End Fund(a) IV 90,000 1,940,584
================================================================================
8,138,745
8.27 SPAIN
Argentaria Caja Postal y Banco
Hipotecario de Espana SA
Registered Shrs BK 300,000 7,065,324
Banco Santander Central Hispano SA
Registered Shrs BK 450,000 9,788,616
Tabacalera SA Series A Shrs TO 450,000 8,774,523
Telefonica SA TN 216,127 10,141,176
Telefonica SA Bonus Rights(a) TN 216,127 201,223
TelePizza SA(a) RS 1,990,000 12,632,520
================================================================================
48,603,382
6.00 SWEDEN
Assa Abloy AB Series B Shrs MG 208,190 9,108,777
Securitas AB Series B Shrs SV 402,500 5,981,750
Skandia Forsakrings AB IN 700,000 13,565,569
Telefonaktiebolaget LM Ericsson
Series B Shrs CM 250,000 6,583,640
================================================================================
35,239,736
5.41 SWITZERLAND
Adecco SA Bearer Shrs SV 10,757 5,433,257
Novartis AG Registered Shrs HD 3,500 5,133,333
Roche Holding AG Non-Voting Shrs HD 100 1,178,325
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
Swiss Bank Warrants (Exp 2001)(a) BK 400,000 $ 3,087,028
Swisscom AG Registered Shrs(a) TN 10,000 3,678,161
UBS AG Registered Shrs BK 20,000 6,804,598
Zurich Allied AG Registered Shrs IN 10,000 6,456,486
================================================================================
31,771,188
22.43 UNITED KINGDOM
Arsenal Football Club PLC(a) ET 226 800,542
AstraZeneca Group PLC HD 90,000 3,525,636
BP Amoco PLC OG 350,000 6,644,078
COLT Telecom Group PLC(a) TN 300,000 5,607,978
Compass Group PLC SV 900,000 9,230,703
Cortecs PLC(a) HD 231,554 82,022
Energis PLC(a) TN 50,000 1,794,448
General Electric PLC MG 24,000 254,460
Glaxo Wellcome PLC HD 70,000 2,071,555
Manchester United PLC ET 3,000,000 9,515,691
Misys PLC CO 885,710 8,321,187
National Westminster Bank PLC BK 450,000 10,846,439
Orange PLC(a) TC 1,003,571 13,670,088
Prudential Corp PLC IN 500,000 7,136,768
Sage Group PLC CO 450,000 15,215,445
SEMA Group PLC CO 853,712 8,261,116
SmithKline Beecham PLC HD 500,000 6,617,511
Tottenham Hotspur PLC ET 500,000 515,232
Unilever PLC HP 350,000 3,105,078
Vodafone Group PLC TC 1,010,000 18,620,002
================================================================================
131,835,979
0.18 UNITED STATES
OXiGENE Inc(a) HD 100,000 1,037,500
================================================================================
TOTAL COMMON STOCKS, RIGHTS & WARRANTS (Cost $456,109,238) 556,444,872
================================================================================
5.31 PREFERRED STOCKS
5.31 GERMANY
Fresenius AG, Non-Voting Pfd HC 31,279 5,460,375
Marschollek, Lautenschlaeger und
Partner AG Non-Voting Pfd IN 10,600 5,943,844
Porsche AG, Non-Voting Pfd AM 3,500 8,516,900
SAP AG, Non-Voting Pfd CO 30,000 11,267,700
================================================================================
TOTAL PREFERRED STOCKS (Cost $28,408,038) 31,188,819
================================================================================
100.00 TOTAL INVESTMENT SECURITIES AT VALUE
(Cost $484,517,276)
(Cost for Income Tax Purposes $486,378,191) $ 587,633,691
================================================================================
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
INTERNATIONAL BLUE CHIP FUND
89.85 COMMON STOCKS
1.39 ARGENTINA
Yacimientos Petroliferos Fiscades
SA Sponsored ADR Representing
Class D Shrs OG 8,000 $ 336,000
================================================================================
5.77 AUSTRALIA
National Australia Bank Ltd BK 30,000 584,987
News Corp Ltd PB 45,000 377,716
Rio Tinto Ltd GP 25,594 431,726
================================================================================
1,394,429
2.86 DENMARK
Den Danske Bank Group BK 6,000 692,426
================================================================================
8.51 FRANCE
AXA Sponsored ADR Representing
1/2 Shr IN 6,000 383,625
Credit Commercial de France BK 4,000 423,200
Elf Aquitaine SA Sponsored ADR
Representing 1/2 Ord Shr OG 4,000 312,500
Groupe Danone FD 1,500 401,511
Societe Generale Series A Shrs BK 3,000 537,676
================================================================================
2,058,512
8.22 GERMANY
BASF AG CH 9,000 394,687
Bayer AG CH 10,000 425,316
DaimlerChrysler AG Registered Shrs(a) AM 4,000 392,750
Deutsche Bank AG BK 6,000 349,140
Deutsche Telekom AG Sponsored ADR
Representing Ord Shrs TL 11,000 426,250
================================================================================
1,988,143
6.27 ITALY
Ente Nazionale Idrocarburi SpA OG 40,000 263,654
San Paolo-IMI SpA Sponsored ADR
Representing 2 Ord Shrs(a) BK 16,000 482,000
Telecom Italia Mobile SpA Savings Shrs TC 40,000 238,685
Telecom Italia SpA Sponsored ADR
Representing 10 Ord Shrs TN 5,000 530,938
================================================================================
1,515,277
14.12 JAPAN
Canon Inc Sponsored ADR Representing
Ord Shrs OE 18,000 436,500
Daiichi Pharmaceutical Ltd HD 15,000 243,790
Fuji Photo Film PI 10,000 377,833
Hitachi Ltd Sponsored ADR Representing
10 Shrs EE 4,000 292,000
Honda Motor Ltd Sponsored ADR
Representing 2 Ord Shrs AM 4,000 353,500
Kirin Brewery Ltd BV 20,000 226,197
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
Kyocera Corp EL 6,000 $ 356,386
Murata Manufacturing Ltd EE 4,000 228,878
Nintendo Co Ltd TY 3,000 279,730
Sony Corp Sponsored ADR Representing
Ord Shrs ET 4,000 370,000
Takefuji Corp CF 3,000 248,817
================================================================================
3,413,631
8.27 NETHERLANDS
ABN AMRO Holding NV Sponsored ADR
Representing Ord Shrs BK 15,000 351,563
ING Groep NV IN 10,000 616,814
Koninklijke Philips Electronics NV
New York Registered Shrs
Representing Ord Shrs HP 6,000 512,250
Unilever NV New York Registered Shrs FD 8,000 519,500
================================================================================
2,000,127
1.75 PORTUGAL
Portugal Telecom SA Sponsored ADR
Representing Ord Shrs TN 10,000 421,875
================================================================================
6.21 SPAIN
Banco Popular Espanol SA BK 7,000 496,202
Endesa SA EU 20,000 445,206
Repsol SA Sponsored ADR Representing
Ord Shrs OG 34,000 561,000
================================================================================
1,502,408
4.38 SWITZERLAND
Nestle SA Registered Shrs FD 275 509,901
Novartis AG Registered Shrs HD 375 550,000
================================================================================
1,059,901
20.67 UNITED KINGDOM
Associated British Foods PLC FD 45,000 331,298
AstraZeneca Group PLC Sponsored ADR
Representing Ord Shrs HD 12,612 495,021
British Airways PLC Sponsored ADR
Representing 10 Ord Shrs AR 5,000 396,250
British Telecommunications PLC
Sponsored ADR Representing
10 Ord Shrs TN 3,000 503,250
Carlton Communications PLC BR 50,000 486,653
Glaxo Wellcome PLC Sponsored ADR
Representing 2 Ord Shrs HD 6,000 349,500
HSBC Holdings PLC BK 15,000 564,662
Marks & Spencer PLC RT 65,000 444,267
PowerGen PLC EU 30,000 329,426
Scottish Power PLC EU 30,000 247,794
Shell Transport & Trading PLC
Sponsored ADR Representing 6
Ord Shrs OG 10,000 454,375
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
SmithKline Beecham PLC
Sponsored ADR Representing
5 Ord Shrs HD 6,000 $ 394,125
================================================================================
4,996,621
1.43 UNITED STATES
British Steel PLC Sponsored ADR
Representing 10 Ord Shrs IS 15,000 346,875
================================================================================
TOTAL COMMON STOCKS (Cost $20,377,648) 21,726,225
================================================================================
1.30 PREFERRED STOCKS
1.30 GERMANY
SAP AG Sponsored ADR Representing
1/12 Pfd Shr (Cost $309,252) CO 10,000 313,750
================================================================================
8.85 SHORT-TERM INVESTMENTS -- REPURCHASE AGREEMENTS
8.85 UNITED STATES
Repurchase Agreement with State
Street dated 4/30/1999 due
5/3/1999 at 4.820%, repurchased
at $2,140,860 (Collateralized by
US Treasury Bonds, due 8/15/2013
at 12.000%, value $2,180,529)
(Cost $2,140,000) RA $2,140,000 2,140,000
================================================================================
100.00 TOTAL INVESTMENT SECURITIES AT VALUE
(Cost $22,826,900)
(Cost for Income Tax Purposes
$23,451,041) $24,179,975
================================================================================
PACIFIC BASIN FUND
100.00 COMMON STOCKS
15.40 AUSTRALIA
AMP Ltd IN 90,000 $ 1,052,858
Australia & New Zealand Banking
Group Ltd BK 130,000 1,031,383
Brambles Industries Ltd SV 50,000 1,471,582
Broken Hill Proprietary Ltd IS 100,000 1,132,327
Lend Lease Ltd FN 71,743 968,762
National Australia Bank Ltd BK 100,000 1,949,958
Rio Tinto Ltd GP 42,485 716,648
TABCORP Holdings Ltd GM 150,000 1,221,872
Telstra Corp Ltd TN 240,000 1,304,390
WMC Ltd GP 200,000 865,617
================================================================================
11,715,397
6.61 HONG KONG
CLP Holdings Ltd EU 90,000 483,066
Cheung Kong Holdings Ltd RL 130,000 1,182,504
COSCO Pacific Ltd SV 900,000 609,638
Hong Kong Telecommunications Ltd TL 200,000 538,030
Hutchison Whampoa Ltd CG 130,000 1,165,731
New World Development Ltd RL 200,000 495,452
Shanghai Industrial Holdings Ltd MG 250,000 554,803
================================================================================
5,029,224
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
67.60 JAPAN
Bank of Tokyo-Mitsubishi Ltd BK 500 $ 7,381
Bridgestone Corp AP 84,000 2,251,916
Canon Inc OE 61,000 1,492,230
Fujitsu Ltd(c) CO 188,000 3,220,877
Ito-Yokado Ltd RT 30,000 1,842,248
Jafco Co Ltd CF 20,000 1,001,969
Kao Corp(c) PL 61,000 1,548,444
Kitagawa Industries Ltd MG 25 269
Matsushita Electric Industrial Ltd EL 25,000 475,432
Matsushita-Kotobuki Electronics
Industries Ltd EL 87,00 1,931,471
Moshi Moshi Hotline(c) SV 15,000 854,522
Murata Manufacturing Ltd EE 14,000 801,072
Mycal Card CF 16,510 590,606
NTT Mobile Communication Network(c) TC 61 3,577,263
Nintendo Co Ltd TY 3,700 345,001
Nippon Telegraph & Telephone TL 218 2,374,230
Nissin Food Products Ltd FD 45,000 987,727
Orix Corp FN 21,000 1,690,697
Rock Field Ltd DB 13,200 285,310
Rohm Co Ltd EL 7,000 844,469
Roland Corp LT 15,500 437,607
Secom Co Ltd EL 28,000 2,735,140
Sekisui Chemical Ltd CH 127,000 849,043
Seven-Eleven Japan Ltd RT 21,000 1,792,737
Shiseido Co Ltd PL 91,000 1,433,251
Shohkoh Fund & Co Ltd FN 4,750 2,785,574
Sony Corp EL 10,400 971,474
TDK Corp CO 18,000 1,361,706
Taisho Pharmaceutical Ltd HD 64,000 1,967,746
Takeda Chemical Industries Ltd HD 86,000 3,739,287
Tokyo Electron Ltd ES 10,000 569,681
Toshiba Corp ES 288,000 1,930,214
Toyota Motor(c) AM 71,000 2,016,420
Uny Co Ltd RT 18,000 286,516
Wacoal Corp TA 88,000 951,032
Yamanouchi Pharmaceutical Ltd HD 46,000 1,456,708
================================================================================
51,407,270
1.81 MALAYSIA
Malayan Banking Berhad BK 120,000 255,158
Tanjong PLC GM 220,000 368,210
YTL Corp Berhad CG 550,000 752,632
================================================================================
1,376,000
0.91 NEW ZEALAND
Telecom Corp of New Zealand Ltd TN 133,000 692,169
================================================================================
<PAGE>
SHARES OR
INDUSTRY PRINCIPAL
% DESCRIPTION CODE AMOUNT VALUE
- --------------------------------------------------------------------------------
5.96 SINGAPORE
City Developments Ltd RL 160,000 $ 1,067,611
DBS Land Ltd RL 350,000 648,952
Development Bank of Singapore
Ltd Foreign Shrs BK 85,000 903,454
Keppel Land Ltd BD 164,000 274,060
Oversea-Chinese Banking Ltd
Foreign Shrs BK 125,000 1,173,605
Singapore Press Holdings Ltd PB 31,500 465,013
================================================================================
4,532,695
1.71 UNITED KINGDOM
HSBC Holdings PLC BK 34,916 1,297,440
================================================================================
100.00 TOTAL INVESTMENT SECURITIES AT VALUE
(Cost $63,392,970)
(Cost for Income Tax Purposes
$64,026,236) $76,050,195
================================================================================
(a) Security is non-income producing.
(b) Securities aquired pursuant to Rule 144A. The Fund deems such
securities to be "liquid" because an institutional market exists.
(c) Security has been designated as collateral for foward foreign currency
contracts.
FORWARD FOREIGN CURRENCY CONTRACTS
- --------------------------------------------------------------------------------
OPEN AT APRIL 30, 1999:
CURRENCY CURRENCY UNREALIZED
CURRENCY/VALUE DATE UNITS SOLD VALUE (US$) GAIN
- --------------------------------------------------------------------------------
PACIFIC BASIN FUND
Japanese Yen 6/17/1999 $ 850,000,000 $ 7,749,392 $ 291,289
================================================================================
<PAGE>
SUMMARY OF INVESTMENTS BY INDUSTRY
- --------------------------------------------------------------------------------
% OF
INDUSTRY INVESTMENT
INDUSTRY CODE SECURITIES VALUE
- --------------------------------------------------------------------------------
EUROPEAN FUND
Air Freight AF 2.29 % $ 13,461,334
Automobiles AM 4.53 26,592,995
Banks BK 11.64 68,372,327
Broadcasting BR 2.34 13,730,195
Communications-- Equipment &
Manufacturing CM 4.01 23,563,482
Computer Related CO 14.11 82,896,215
Engineering & Construction EC 1.82 10,712,250
Entertainment ET 1.84 10,831,465
Foods FD 2.14 12,566,395
Health Care Drugs-- Pharmaceuticals HD 5.21 30,628,980
Health Care Related HC 0.93 5,460,375
Household Products HP 0.53 3,105,078
Insurance IN 8.61 50,596,697
Investment Bank/Broker Firm IV 1.07 6,290,584
Machinery MY 3.68 21,625,520
Manufacturing MG 1.59 9,363,237
Oil & Gas Related OG 1.13 6,644,078
Pollution Control PC 2.79 16,378,781
Publishing PB 0.89 5,230,752
Restaurants RS 3.56 20,897,616
Retail RT 3.57 20,964,270
Services SV 3.51 20,645,710
Telecommunications-- Cellular &
Wireless TC 9.28 54,537,640
Telecommunications-- Long Distance TL 2.54 14,952,721
Telephone TN 4.90 28,810,471
Tobacco TO 1.49 8,774,523
================================================================================
100.00 % $ 587,633,691
================================================================================
INTERNATIONAL BLUE CHIP FUND
Airlines AR 1.64 % $ 396,250
Automobiles AM 3.09 746,250
Banks BK 18.54 4,481,856
Beverages BV 0.94 226,197
Broadcasting BR 2.01 486,653
Chemicals CH 3.39 820,003
Computer Related CO 1.30 313,750
Consumer Finance CF 1.03 248,817
Electric Utilities EU 4.23 1,022,426
Electrical Equipment EE 2.15 520,878
Electronics EL 1.47 356,386
Entertainment ET 1.53 370,000
Foods FD 7.29 1,762,210
Gold & Precious Metals Mining GP 1.78 431,726
Health Care Drugs-- Pharmaceuticals HD 8.41 2,032,436
Household Products HP 2.12 512,250
Insurance IN 4.14 1,000,439
Iron & Steel IS 1.43 346,875
Office Equipment & Supplies OE 1.80 436,500
Oil & Gas Related OG 7.97 1,927,529
Photography & Imaging PI 1.56 377,833
Publishing PB 1.56 377,716
<PAGE>
SUMMARY OF INVESTMENTS BY INDUSTRY (CONTINUED)
- --------------------------------------------------------------------------------
% OF
INDUSTRY INVESTMENT
INDUSTRY CODE SECURITIES VALUE
- --------------------------------------------------------------------------------
INTERNATIONAL BLUE CHIP FUND
(CONTINUED)
Repurchase Agreements RA 8.85 % $ 2,140,000
Retail RT 1.84 444,267
Telecommunications-- Cellular
& Wireless TC 0.99 238,685
Telecommunications-- Long Distance TL 1.76 426,250
Telephone TN 6.02 1,456,063
Toys TY 1.16 279,730
================================================================================
100.00 % $ 24,179,975
================================================================================
PACIFIC BASIN FUND
Auto Parts AP 2.96 % $ 2,251,916
Automobiles AM 2.65 2,016,420
Banks BK 8.70 6,618,379
Building Materials BD 0.36 274,060
Chemicals CH 1.12 849,043
Computer Related CO 6.03 4,582,583
Conglomerates CG 2.52 1,918,363
Consumer Finance CF 2.09 1,592,575
Distribution DB 0.38 285,310
Electric Utilities EU 0.64 483,066
Electrical Equipment EE 1.05 801,072
Electronics EL 9.15 6,957,986
Electronics-- Semiconductor ES 3.29 2,499,895
Financial FN 7.16 5,445,033
Foods FD 1.30 987,727
Gaming GM 2.09 1,590,082
Gold & Precious Metals Mining GP 2.08 1,582,265
Health Care Drugs-- Pharmaceuticals HD 9.42 7,163,741
Insurance IN 1.38 1,052,858
Iron & Steel IS 1.49 1,132,327
Leisure Time LT 0.58 437,607
Manufacturing MG 0.73 555,072
Office Equipment & Supplies OE 1.96 1,492,230
Personal Care PL 3.92 2,981,695
Publishing PB 0.61 465,013
Real Estate Related RL 4.46 3,394,519
Retail RT 5.16 3,921,501
Services SV 3.86 2,935,742
Telecommunications-- Cellular &
Wireless TC 4.70 3,577,263
Telecommunications-- Long Distance TL 3.83 2,912,260
Telephone TN 2.63 1,996,559
Textile-- Apparel Manufacturing TA 1.25 951,032
Toys TY 0.45 345,001
================================================================================
100.00 % $ 76,050,195
================================================================================
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
APRIL 30, 1999
UNAUDITED
INTERNATIONAL
EUROPEAN BLUE CHIP
FUND FUND
- --------------------------------------------------------------------------------
ASSETS
Investment Securities:
At Cost(a) $ 484,517,276 $ 22,826,900
================================================================================
At Value(a) $ 587,633,691 $ 24,179,975
Cash 0 9,752
Foreign Currency (Cost $0 and
$187,609, respectively) 0 187,595
Receivables:
Investment Securities Sold 42,469,625 0
Fund Shares Sold 8,358,285 202,884
Dividends and Interest 1,096,282 74,906
Prepaid Expenses and Other Assets 101,585 61,691
================================================================================
TOTAL ASSETS 639,659,468 24,716,803
================================================================================
LIABILITIES
Payables:
Custodian 974,319 0
Foreign Sub-Custodian (Cost
$5,375,297 and $0, respectively) 5,325,490 0
Investment Securities Purchased 22,033,643 3,179,685
Fund Shares Repurchased 12,822,596 2,156,155
Depreciation on Forward Foreign
Currency Contracts 34,504 0
Borrowings on Line of Credit 30,000,000 0
Accrued Distribution Expenses 132,651 4,803
Accrued Expenses and Other Payables 134,616 1,003
================================================================================
TOTAL LIABILITIES 71,457,819 5,341,646
================================================================================
NET ASSETS AT VALUE $ 568,201,649 $ 19,375,157
================================================================================
NET ASSETS
Paid-in Capital(b) $ 452,416,397 $ 18,650,026
Accumulated Undistributed Net
Investment Income (Loss) (1,501,114) 33,323
Accumulated Undistributed Net
Realized Gain (Loss) on
Investment Securities and Foreign
Currency Transactions 14,169,208 (665,480)
Net Appreciation of Investment
Securities and Foreign
Currency Transactions 103,117,158 1,357,288
================================================================================
NET ASSETS AT VALUE $ 568,201,649 $ 19,375,157
================================================================================
Shares Outstanding 33,846,499 1,830,311
NET ASSET VALUE, Offering and
Redemption Price per Share $ 16.79 $ 10.59
================================================================================
(a) Investment securities at cost and value at April 30, 1999 include a
repurchase agreement of $2,140,000 for International Blue Chip Fund.
(b) The Fund has 800 million authorized shares of common stock, par value
of $0.01 per share. Of such shares, 100 million have been allocated
to each individual Fund.
See Notes to Financial Statements
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (CONTINUED)
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
APRIL 30, 1999
UNAUDITED
PACIFIC
BASIN
FUND
- --------------------------------------------------------------------------------
ASSETS
Investment Securities:
At Cost $ 63,392,970
================================================================================
At Value $ 76,050,195
Foreign Currency (Cost $0 and $723,946, respectively) 723,889
Receivables:
Fund Shares Sold 1,694,523
Dividends and Interest 137,443
Appreciation on Forward Foreign Currency Contracts 291,242
Prepaid Expenses and Other Assets 210,126
================================================================================
TOTAL ASSETS 79,107,418
================================================================================
LIABILITIES
Payables:
Custodian 4,957,280
Investment Securities Purchased 812,337
Fund Shares Repurchased 1,290,670
Borrowings on Line of Credit 6,500,000
Accrued Distribution Expenses 14,943
Accrued Expenses and Other Payables 34,158
================================================================================
TOTAL LIABILITIES 13,609,388
================================================================================
NET ASSETS AT VALUE $ 65,498,030
================================================================================
NET ASSETS
Paid-in Capital(a) $ 76,407,677
Accumulated Undistributed Net Investment Loss (195,400)
Accumulated Undistributed Net Realized Loss on Investment
Securities and Foreign Currency Transactions (23,663,810)
Net Appreciation of Investment Securities and Foreign
Currency Transactions 12,949,563
================================================================================
NET ASSETS AT VALUE $ 65,498,030
================================================================================
Shares Outstanding 8,100,111
NET ASSET VALUE, Offering and Redemption
Price per Share $ 8.09
================================================================================
(a) The Fund has 800 million authorized shares of common stock, par value
of $0.01 per share. Of such shares, 100 million have been allocated to
each individual Fund.
See Notes to Financial Statements
<PAGE>
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
SIX MONTHS ENDED APRIL 30, 1999
UNAUDITED
INTERNATIONAL
EUROPEAN BLUE CHIP
FUND FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME
Dividends $ 3,208,120 $ 152,892
Interest 560,526 31,912
Foreign Taxes Withheld (422,623) (17,290)
================================================================================
TOTAL INCOME 3,346,023 167,514
================================================================================
EXPENSES
Investment Advisory Fees 2,481,477 50,716
Distribution Expenses 895,396 16,905
Transfer Agent Fees 836,816 17,051
Administrative Fees 58,724 6,014
Custodian Fees and Expenses 444,097 12,764
Directors' Fees and Expenses 18,838 684
Professional Fees and Expenses 27,105 9,563
Registration Fees and Expenses 59,628 23,318
Reports to Shareholders 169,617 5,615
Other Expenses 290,242 1,580
================================================================================
TOTAL EXPENSES 5,281,940 144,210
Fees and Expenses Absorbed by
Investment Adviser 0 (1,138)
Fees and Expenses Paid Indirectly (265,119) (6,709)
================================================================================
NET EXPENSES 5,016,821 136,363
================================================================================
NET INVESTMENT INCOME (LOSS) (1,670,798) 31,151
================================================================================
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES
Net Realized Gain (Loss) on:
Investment Securities 25,404,825 (439,420)
Foreign Currency Transactions (9,314,664) (226,060)
================================================================================
Total Net Realized Gain (Loss) 16,090,161 (665,480)
================================================================================
Change in Net Appreciation
(Depreciation) of:
Investment Securities 71,237,758 1,744,436
Foreign Currency Transactions (42,143,161) (394,348)
================================================================================
Total Net Appreciation 29,094,597 1,350,088
================================================================================
NET GAIN ON INVESTMENT SECURITIES AND
FOREIGN CURRENCY TRANSACTIONS 45,184,758 684,608
================================================================================
NET INCREASE IN NET ASSETS FROM
OPERATIONS $43,513,960 $ 715,759
================================================================================
See Notes to Financial Statements
<PAGE>
STATEMENT OF OPERATIONS (CONTINUED)
- --------------------------------------------------------------------------------
INVESCO INTERNATIONAL FUNDS, INC.
SIX MONTHS ENDED APRIL 30, 1999
UNAUDITED
PACIFIC
BASIN
FUND
- --------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME
Dividends $ 341,162
Interest 120,205
Foreign Taxes Withheld (22,696)
================================================================================
TOTAL INCOME 438,671
================================================================================
EXPENSES
Investment Advisory Fees 197,074
Distribution Expenses 65,691
Transfer Agent Fees 231,682
Administrative Fees 8,916
Custodian Fees and Expenses 49,624
Directors' Fees and Expenses 5,248
Professional Fees and Expenses 14,003
Registration Fees and Expenses 33,984
Reports to Shareholders 65,073
Other Expenses 23,432
================================================================================
TOTAL EXPENSES 694,727
Fees and Expenses Absorbed by Investment Adviser (134,681)
Fees and Expenses Paid Indirectly (29,369)
================================================================================
NET EXPENSES 530,677
================================================================================
NET INVESTMENT LOSS (92,006)
================================================================================
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES
Net Realized Loss on:
Investment Securities (2,400,970)
Foreign Currency Transactions (804,809)
================================================================================
Total Net Realized Loss (3,205,779)
================================================================================
Change in Net Appreciation of:
Investment Securities 17,042,856
Foreign Currency Transactions 1,103,670
================================================================================
Total Net Appreciation 18,146,526
================================================================================
NET GAIN ON INVESTMENT SECURITIES AND
FOREIGN CURRENCY TRANSACTIONS 14,940,747
================================================================================
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 14,848,741
================================================================================
See Notes to Financial Statements
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
EUROPEAN FUND
SIX MONTHS YEAR
ENDED ENDED
APRIL 30 OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998
UNAUDITED
OPERATIONS
Net Investment Income (Loss) $ (1,670,798) $ 1,263,965
Net Realized Gain on Investment
Securities and Foreign Currency
Transactions 16,090,161 58,673,849
Change in Net Appreciation of Investment
Securities and Foreign Currency
Transactions 29,094,597 20,880,367
================================================================================
NET INCREASE IN NET ASSETS FROM OPERATIONS 43,513,960 80,818,181
================================================================================
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income 0 (1,807,826)
In Excess of Net Investment Income 0 (16,166)
Net Realized Gain on Investment Securities
and Foreign Currency Transactions (60,299,435) (58,987,304)
================================================================================
TOTAL DISTRIBUTIONS (60,299,435) (60,811,296)
================================================================================
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 2,001,493,871 2,657,190,380
Reinvestment of Distributions 57,984,880 56,473,483
================================================================================
2,059,478,751 2,713,663,863
Amounts Paid for Repurchases of Shares (2,146,637,396) (2,386,344,289)
================================================================================
NET INCREASE (DECREASE) IN NET ASSETS
FROM FUND SHARE TRANSACTIONS (87,158,645) 327,319,574
================================================================================
TOTAL INCREASE (DECREASE) IN NET ASSETS (103,944,120) 347,326,459
NET ASSETS
Beginning of Period 672,145,769 324,819,310
================================================================================
End of Period (Including Accumulated
Undistributed Net Investment Income
(Loss) of ($1,501,114) and
$169,684, respectively) $ 568,201,649 $ 672,145,769
================================================================================
---------------------------------------------------------------------
FUND SHARE TRANSACTIONS
Shares Sold 112,005,974 144,625,579
Shares Issued from Reinvestment of
Distributions 3,441,239 3,870,367
================================================================================
115,447,213 148,495,946
Shares Repurchased (119,751,259) (129,075,181)
================================================================================
NET INCREASE (DECREASE) IN FUND SHARES (4,304,046) 19,420,765
================================================================================
See Notes to Financial Statements
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
INTERNATIONAL BLUE CHIP FUND
SIX MONTHS PERIOD
ENDED ENDED
APRIL 30 OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998
UNAUDITED (Note 1)
OPERATIONS
Net Investment Income $ 31,151 $ 2,172
Net Realized Loss on Investment Securities
and Foreign Currency Transactions (665,480) 0
Change in Net Appreciation of Investment
Securities and Foreign Currency
Transactions 1,350,088 7,200
================================================================================
NET INCREASE IN NET ASSETS FROM OPERATIONS 715,759 9,372
================================================================================
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 61,539,846 6,281,511
Amounts Paid for Repurchases of Shares (49,167,697) (3,634)
================================================================================
NET INCREASE IN NET ASSETS FROM
FUND SHARE TRANSACTIONS 12,372,149 6,277,877
================================================================================
TOTAL INCREASE IN NET ASSETS 13,087,908 6,287,249
NET ASSETS
Beginning of Period 6,287,249 0
================================================================================
End of Period (Including Accumulated
Undistributed Net Investment Income
of $33,323 and $2,172, respectively) $19,375,157 $ 6,287,249
================================================================================
----------------------------------------------------------------------
FUND SHARE TRANSACTIONS
Shares Sold 5,891,072 627,880
Shares Repurchased (4,688,278) (363)
================================================================================
NET INCREASE IN FUND SHARES 1,202,794 627,517
================================================================================
See Notes to Financial Statements
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
PACIFIC BASIN FUND
SIX MONTHS YEAR
ENDED ENDED
APRIL 30 OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998
UNAUDITED
OPERATIONS
Net Investment Income (Loss) $ (92,006) $ 121,093
Net Realized Loss on Investment
Securities and Foreign Currency
Transactions (3,205,779) (19,918,269)
Change in Net Appreciation of Investment
Securities and Foreign Currency
Transactions 18,146,526 7,204,445
================================================================================
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS 14,848,741 (12,592,731)
================================================================================
DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income (336,736) (645,743)
In Excess of Net Investment Income 0 (21,009)
In Excess of Net Realized Gain on
Investment Securities and Foreign
Currency Transactions 0 (1,134,104)
================================================================================
TOTAL DISTRIBUTIONS (336,736) (1,800,856)
================================================================================
FUND SHARE TRANSACTIONS
Proceeds from Sales of Shares 425,716,653 396,569,871
Reinvestment of Distributions 318,350 1,722,714
================================================================================
426,035,003 398,292,585
Amounts Paid for Repurchases of Shares (420,117,418) (402,773,585)
================================================================================
NET INCREASE (DECREASE) IN NET ASSETS
FROM FUND SHARE TRANSACTIONS 5,917,585 (4,481,000)
================================================================================
TOTAL INCREASE (DECREASE) IN NET ASSETS 20,429,590 (18,874,587)
NET ASSETS
Beginning of Period 45,068,440 63,943,027
================================================================================
End of Period (Including Accumulated
Undistributed (Distributions in
Excess of) Net Investment Income
(Loss) of ($195,400) and $233,342,
respectively) $ 65,498,030 $ 45,068,440
================================================================================
----------------------------------------------------------
FUND SHARE TRANSACTIONS
Shares Sold 58,370,083 52,503,576
Shares Issued from Reinvestment of
Distributions 44,812 208,312
================================================================================
58,414,895 52,711,888
Shares Repurchased (57,048,430) (52,543,507)
================================================================================
NET INCREASE IN FUND SHARES 1,366,465 168,381
================================================================================
See Notes to Financial Statements
<PAGE>
INVESCO NOTES TO FINANCIAL STATEMENTS -- INVESCO INTERNATIONAL
FUNDS, INC.
- --------------------------------------------------------------------------------
UNAUDITED
NOTE 1 -- ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES. INVESCO
International Funds, Inc. (the "Fund") is incorporated in Maryland and presently
consists of three separate Funds: European Fund, International Blue Chip Fund
and Pacific Basin Fund. The investment objectives are: to seek capital
appreciation through investments in designated geographical sectors for European
and Pacific Basin Funds and to seek a high total return through capital
appreciation and current income by investing in foreign companies for
International Blue Chip Fund. International Blue Chip Fund commenced investment
operations on October 28, 1998. The Fund is registered under the Investment
Company Act of 1940 (the "Act") as a diversified, open-end management investment
company.
On February 3, 1999, the board of directors of the Fund approved the liquidation
of Emerging Markets Fund and effective May 21, 1999, Emerging Markets Fund
liquidated its assets and closed the Fund. On May 20, 1999, shareholders of
European, International Blue Chip and International Growth Funds, and on May 28,
1999, shareholders of Pacific Basin Fund approved an Agreement and Plan of
Reorganization and Termination, in which the following Funds will merge: INVESCO
Specialty Funds, Inc. - European Small Company Fund ("Target Fund") into
European Fund ("Surviving Fund"); International Growth Fund ("Target Fund") into
International Blue Chip Fund ("Surviving Fund") and INVESCO Specialty Funds,
Inc. - Asian Growth Fund ("Target Fund") into Pacific Basin Fund ("Surviving
Fund"), effective close of business on June 18, 1999. Shareholders of the Target
Funds will become shareholders of the Surviving Funds and will receive shares of
the Surviving Funds equal in number and in dollar value to the then current
number and value of their shares in the Target Funds.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
A. SECURITY VALUATION -- Equity securities traded on national securities
exchanges or in the over-the-counter market are valued at the last sales price
in the market where such securities are primarily traded. If last sales prices
are not available, securities are valued at the highest closing bid price
obtained from one or more dealers making a market for such securities or by a
pricing service approved by the Fund's board of directors.
Foreign securities are valued at the closing price on the principal stock
exchange on which they are traded. In the event that closing prices are not
available for foreign securities, prices will be obtained from the principal
stock exchange at or prior to the close of the New York Stock Exchange. Foreign
currency exchange rates are determined daily prior to the close of the New York
Stock Exchange.
If market quotations or pricing service valuations are not readily available,
securities are valued at fair value as determined in good faith under procedures
established by the Fund's board of directors. Restricted securities are valued
in accordance with procedures established by the Fund's board of directors.
Short-term securities are stated at amortized cost (which approximates market
value) if maturity is 60 days or less at the time of purchase, or market value
if maturity is greater than 60 days.
Assets and liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the prevailing market rates as quoted by one or
more banks or dealers on the date of valuation.
<PAGE>
B. REPURCHASE AGREEMENTs -- Repurchase agreements held by the Fund are fully
collateralized by U.S. Government securities and such collateral is in the
possession of the Fund's custodian. The collateral is evaluated daily to ensure
its market value exceeds the current market value of the repurchase agreements
including accrued interest. In the event of default on the obligation to
repurchase, the Fund has the right to liquidate the collateral and apply the
proceeds in satisfaction of the obligation. In the event of default or
bankruptcy by the other party to the agreement, realization and/or retention of
the collateral or proceeds may be subject to legal proceedings.
C. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME -- Security transactions
are accounted for on the trade date and dividend income is recorded on the ex
dividend date. Certain dividends from foreign securities will be recorded as
soon as the Fund is informed of the dividend if such information is obtained
subsequent to the ex dividend date. Interest income, which may be comprised of
stated coupon rate, market discount, original issue discount and amortized
premium, is recorded on the accrual basis. Income and expenses on foreign
securities are translated into U.S. dollars at rates of exchange prevailing when
accrued. Cost is determined on the specific identification basis. The cost of
foreign securities is translated into U.S. dollars at the rates of exchange
prevailing when such securities are acquired.
The Fund may have elements of risk due to concentrated investments in foreign
issuers located in a specific country. Such concentrations may subject the Fund
to additional risks resulting from future political or economic conditions
and/or possible impositions of adverse foreign governmental laws or currency
exchange restrictions. Net realized and unrealized gain or loss from investment
securities includes fluctuations from currency exchange rates and fluctuations
in market value.
The Fund's use of forward foreign currency contracts may subject it to certain
risks as a result of unanticipated movements in foreign exchange rates. The Fund
does not hold forward foreign currency contracts for trading purposes. The Fund
may hold foreign currency in anticipation of settling foreign security
transactions and not for investment purposes.
On September 1, 1998, the Malaysian government introduced capital controls and
imposed a fixed exchange rate for the Malaysian ringgit. The controls require
that all Malaysian securities and currency be repatriated to Malaysia and impose
significant restrictions on the movement of Malaysian securities and currency
out of the country. These actions may pose significant liquidity issues and
risks and may significantly affect the valuation of Malaysian securities and
currency held by the Fund. The price of Malaysian securities have been
discounted.
Restricted securities held by the Fund may not be sold except in exempt
transactions or in a public offering registered under the Securities Act of
1933. The risk of investing in such securities is generally greater than the
risk of investing in the securities of widely held, publicly traded companies.
Lack of a secondary market and resale restrictions may result in the inability
of each Fund to sell a security at a fair price and may substantially delay the
sale of the security which each Fund seeks to sell. In addition, these
securities may exhibit greater price volatility than securities for which
secondary markets exist.
D. FEDERAL AND STATE TAXES -- The Fund has complied, and continues to comply,
with the provisions of the Internal Revenue Code applicable to regulated
investment companies and, accordingly, has made or intends to make sufficient
distributions of net investment income and net realized capital gains, if any,
to relieve it from all federal and state income taxes and federal excise taxes.
At October 31, 1998, the Pacific Basin Fund had $21,276,447, in net capital loss
carryovers which expire in the year 2006.
To the extent future capital gains are offset by capital loss carryovers, such
gains will not be distributed to shareholders.
Dividends paid by the Fund from net investment income and distributions of net
realized short-term capital gains are, for federal income tax purposes, taxable
as ordinary income to shareholders.
<PAGE>
Investment income received from foreign sources may be subject to foreign
withholding taxes. Dividend and interest income is shown gross of foreign
withholding taxes in the accompanying financial statements.
E. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends and distributions to
shareholders are recorded by the Fund on the ex dividend/distribution date. The
Fund distributes net realized capital gains, if any, to its shareholders at
least annually, if not offset by capital loss carryovers. Income distributions
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for foreign currency
transactions, nontaxable dividends, net operating losses and expired capital
loss carryforwards.
F. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund enters into forward foreign
currency contracts in connection with planned purchases or sales of securities
as a hedge against fluctuations in foreign exchange rates pending the settlement
of transactions in foreign securities. A forward foreign currency contract is an
agreement between contracting parties to exchange an amount of currency at some
future time at an agreed upon rate. These contracts are marked-to-market daily
and the related appreciation or depreciation of the contracts is presented in
the Statement of Assets and Liabilities. Any realized gain or loss incurred by
the Fund upon the sale of securities is included in the Statement of Operations.
At April 30, 1999, the Fund had outstanding forward foreign currency contracts.
Unrealized gain or loss on forward foreign currency contracts is calculated
daily as the difference between the contract exchange rate and the closing
forward rate applied to the face amount of the contract.
Forward foreign currency contracts held by the Fund are fully collateralized by
other securities which are notated in the Statement of Investment Securities and
such collateral is in the possession of the Fund's custodian. The collateral is
evaluated daily to ensure its market value exceeds the current market value of
the forward foreign currency contract.
G. EXPENSES -- Each of the Funds bears expenses incurred specifically on its
behalf and, in addition, each Fund bears a portion of general expenses, based on
the relative net assets of each Fund.
Under an agreement between each Fund and the Fund's Custodian, agreed upon
Custodian Fees and Expenses are reduced by credits granted by the Custodian from
any temporarily uninvested cash. Such credits are included in Fees and Expenses
Paid Indirectly in the Statement of Operations.
NOTE 2 -- INVESTMENT ADVISORY AND OTHER AGREEMENTS. INVESCO Funds Group, Inc.
("IFG") serves as the Funds' investment adviser. As compensation for its
services to each Fund, IFG receives an investment advisory fee which is accrued
daily at the applicable rate and paid monthly. The fee is based on the annual
rate of each Fund's average net assets as follows:
AVERAGE NET ASSETS
- --------------------------------------------------------------------------------
$500
$0 to $0 to $350 to Million Over Over
$350 $500 $700 to $1 $700 $1
Fund Million Million Million Billion Million Billion
- --------------------------------------------------------------------------------
European Fund 0.75% -- 0.65% -- 0.55% --
International Blue
Chip Fund* -- 0.75% -- 0.65% -- 0.55%
Pacific Basin Fund 0.75% -- 0.65% -- 0.55% --
* Prior to May 13, 1999 the fee for International Blue Chip Fund was based on
the annual rate of 0.75% of average net assets.
<PAGE>
In accordance with a Sub-Advisory Agreement between IFG and INVESCO Asset
Management Limited ("IAM"), an affiliate of IFG, investment decisions of
European and Pacific Basin Funds are made by IAM. A separate Sub-Advisory
Agreement between IFG and INVESCO Global Asset Management (N.A.) ("IGAM"), an
affiliate of IFG, provides that investment decisions of International Blue Chip
Fund are made by IGAM. Fees for such sub-advisory services are paid by IFG.
A plan of distribution pursuant to Rule 12b-1 of the Act provides for
compensation of marketing and advertising expenditures to INVESCO Distributors,
Inc. ("IDI" or the "Distributor"), a wholly owned subsidiary of IFG, to a
maximum of 0.25% of annual average net assets. For the six months ended April
30, 1999, European, International Blue Chip and Pacific Basin Funds paid the
Distributor $884,053, $12,161 and $59,677, respectively, under the plan of
distribution.
IFG receives a transfer agent fee from each Fund at an annual rate of $20.00 per
shareholder account, or, where applicable, per participant in an omnibus
account, per year. IFG may pay such fee for participants in omnibus accounts to
affiliates or third parties. The fee is paid monthly at one-twelfth of the
annual fee and is based upon the actual number of accounts in existence during
each month.
In accordance with an Administrative Agreement, each Fund paid IFG an annual fee
of $10,000, plus an additional amount computed at an annual rate of 0.015% of
average net assets to provide administrative, accounting and clerical services.
The fee is accrued daily and paid monthly. Effective May 13, 1999, each Fund
pays IFG an annual fee of $10,000, plus an additional amount computed at an
annual rate of 0.045% of average net assets.
IFG has agreed to absorb certain fees and expenses incurred by European and
Pacific Basin Funds. IFG and IGAM have agreed to absorb certain fees and
expenses incurred by International Blue Chip Fund.
NOTE 3 -- PURCHASES AND SALES OF INVESTMENT SECURITIES. For the six months ended
April 30, 1999, the aggregate cost of purchases and proceeds from sales of
investment securities (excluding all U.S. Government securities and short-term
securities) were as follows:
FUND PURCHASES SALES
- --------------------------------------------------------------------------------
European Fund $ 386,077,395 $ 462,084,284
International Blue Chip Fund 28,902,947 11,067,056
Pacific Basin Fund 67,435,224 47,180,518
There were no purchases or sales of U.S. Government securities.
NOTE 4 -- APPRECIATION AND DEPRECIATION. At April 30, 1999, the gross
appreciation of securities in which there was an excess of value over tax cost,
the gross depreciation of securities in which there was an excess of tax cost
over value and the resulting net appreciation by Fund were as follows:
GROSS GROSS NET
FUND APPRECIATION DEPRECIATION APPRECIATION
- --------------------------------------------------------------------------------
European Fund $ 132,822,219 $ 31,566,719 $ 101,255,500
International Blue
Chip Fund 1,730,474 1,001,540 728,934
Pacific Basin Fund 12,463,071 439,112 12,023,959
NOTE 5 -- TRANSACTIONS WITH AFFILIATES. Certain of the Funds' officers and
directors are also officers and directors of IFG, IDI, IAM or IGAM.
Each Fund has adopted an unfunded defined benefit deferred compensation plan
covering all independent directors of the Fund who will have served as an
independent director for at least five years at the time of retirement. Benefits
under this plan are based on an annual rate equal to 50% of the sum of the
retainer fee at the time of retirement plus the annual meeting fee.
<PAGE>
Pension expenses for the six months ended April 30, 1999, included in Directors'
Fees and Expenses in the Statement of Operations, and unfunded accrued pension
costs and pension liability included in Prepaid Expenses and Accrued Expenses,
respectively, in the Statement of Assets and Liabilities were as follows:
UNFUNDED
PENSION ACCRUED PENSION
FUND EXPENSES PENSION COSTS LIABILITY
- --------------------------------------------------------------------------------
European Fund $ 6,906 $ 23,361 $ 50,756
Pacific Basin Fund 732 13,494 28,229
Pension expenses, unfunded accrued pension costs and pension liabilities were
insignificant for International Blue Chip Fund.
The independent directors have contributed to a deferred fee agreement, pursuant
to which they have deferred receipt of a portion of the compensation which they
would otherwise have been paid as directors of selected INVESCO Funds. The
deferred amounts may be invested in the shares of any of the INVESCO or
Treasurer's Series Trust Funds.
NOTE 6 -- LINE OF CREDIT. Each Fund has available a Redemption Line of Credit
Facility ("LOC"), from a consortium of national banks, to be used for temporary
or emergency purposes to fund redemptions of investor shares. The LOC permits
borrowings to a maximum of 10% of the Net Assets at Value of each respective
Fund. Each Fund agrees to pay annual fees and interest on the unpaid principal
balance based on prevailing market rates as defined in the agreement. At April
30, 1999, European and Pacific Basin Funds had an outstanding line of credit at
an interest rate of 5.130% and 5.310%, respectively. The amount of the borrowing
and the related accrued interest are presented in the Statement of Assets and
Liabilities. On May 13, 1999 and May 11, 1999, European and Pacific Basin Funds
paid the line of credit in full, including interest. There were no such
borrowings in any other Fund.
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
EUROPEAN FUND
(FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
SIX MONTHS
ENDED
APRIL 30 YEAR ENDED OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
UNAUDITED
PER SHARE DATA
Net Asset Value --
Beginning of Period $17.62 $17.34 $15.85 $14.09 $12.95 $12.20
================================================================================
INCOME FROM INVESTMENT
OPERATIONS
Net Investment Income
(Loss) (0.05) 0.04 0.07 0.05 0.23 0.16
Net Gains on Securities
(Both Realized and
Unrealized) 0.91 3.58 2.63 3.00 1.12 0.75
================================================================================
TOTAL FROM INVESTMENT
OPERATIONS 0.86 3.62 2.70 3.05 1.35 0.91
================================================================================
LESS DISTRIBUTIONS
Dividends from Net
Investment Income(a) 0.00 0.06 0.07 0.08 0.21 0.16
Distributions from Capital
Gains 1.69 3.28 1.14 1.21 0.00 0.00
================================================================================
TOTAL DISTRIBUTIONS 1.69 3.34 1.21 1.29 0.21 0.16
================================================================================
Net Asset Value--
End of Period $16.79 $17.62 $17.34 $15.85 $14.09 $12.95
================================================================================
TOTAL RETURN 4.85%(b) 24.92% 18.07% 23.47% 10.42% 7.43%
RATIOS
Net Assets --
End of Period
($000 Omitted) $568,202 $672,146 $324,819 $300,588 $224,200 $349,842
Ratio of Expenses to
Average Net Assets 0.73%(b)(c) 1.34%(c) 1.25%(c) 1.36%(c) 1.40%(c) 1.20%
Ratio of Net Investment
Income(Loss) to Average
Net Assets (0.23%)(b) 0.24% 0.33% 0.37% 1.26% 1.28%
Portfolio Turnover Rate 56%(b) 102% 90% 91% 96% 70%
(a) Distributions in excess of net investment income for the year ended
October 31, 1998, aggregated amounted to less than $0.01 on a per share
basis.
(b) Based on operations for the period shown and, accordingly, are
not representative of a full year.
(c) Ratio is based on Total Expenses of the Fund, which is before any expense
offset arrangements.
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
INTERNATIONAL BLUE CHIP FUND
(FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
SIX MONTHS PERIOD
ENDED ENDED
APRIL 30 OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998(a)
UNAUDITED
PER SHARE DATA
Net Asset Value-- Beginning of
Period $ 10.02 $ 10.00
================================================================================
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.01 0.00
Net Gains on Securities
(Both Realized and Unrealized) 0.56 0.02
================================================================================
TOTAL FROM INVESTMENT OPERATIONS 0.57 0.02
================================================================================
Net Asset Value-- End of Period $ 10.59 $ 10.02
================================================================================
TOTAL RETURN 5.69%(b) 0.20%(b)
RATIOS
Net Assets-- End of Period
($000 Omitted) $ 19,375 $ 6,287
Ratio of Expenses to Average
Net Assets(c)(d) 1.05%(b) 0.90%(e)
Ratio of Net Investment Income to
Average Net Assets(d) 0.23%(b) 6.16%(e)
Portfolio Turnover Rate 87%(b) 0%(b)
(a) From October 28, 1998, commencement of investment operations, to October 31,
1998.
(b) Based on operations for the period shown and, accordingly, are
not representative of a full year.
(c) Ratio is based on Total Expenses of the Fund, less Expenses Absorbed
by Investment Adviser, which is before any expense offset arrangements.
(d) Various expenses of the Fund were voluntarily absorbed by IFG for the
six months ended April 30, 1999. If such expenses had not been
voluntarily absorbed, ratio of expenses to average net assets would have
been 1.06% (not annualized) and ratio of net invesment income to average
net assets would have been 0.22% (not annualized).
(e) Annualized
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
PACIFIC BASIN FUND
(FOR A FUND SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
SIX MONTHS
ENDED
APRIL 30 YEAR ENDED OCTOBER 31
- --------------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
UNAUDITED
PER SHARE DATA
Net Asset Value --
Beginning of
Period $ 6.69 $ 9.74 $ 14.11 $ 13.83 $ 17.07 $ 15.11
================================================================================
INCOME FROM
INVESTMENT OPERATIONS
Net Investment
Income (Loss) (0.01) 0.07 (0.09) (0.02) 0.06 0.04
Net Gains or (Losses)
on Securities(Both
Realized and
Unrealized) 1.46 (2.80) (3.45) 0.51 (1.45) 2.28
================================================================================
TOTAL FROM INVESTMENT
OPERATIONS 1.45 (2.73) (3.54) 0.49 (1.39) 2.32
================================================================================
LESS DISTRIBUTIONS
Dividends from Net
Investment Income(a) 0.05 0.12 0.00 0.03 0.06 0.04
Distributions from
Capital Gains 0.00 0.00 0.83 0.18 1.79 0.32
In Excess of Capital
Gains 0.00 0.20 0.00 0.00 0.00 0.00
================================================================================
TOTAL DISTRIBUTIONS 0.05 0.32 0.83 0.21 1.85 0.36
================================================================================
Net Asset Value --
End of Period $ 8.09 $ 6.69 $ 9.74 $ 14.11 $ 13.83 $ 17.07
================================================================================
TOTAL RETURN 21.68%(b)(28.68%) (26.65%) 3.55% (8.31%) 15.63%
RATIOS
Net Assets -- End
of Period ($000
Omitted) $65,498 $45,070 $63,943 $149,870 $ 154,374 $352,888
Ratio of Expenses
to Average Net
Assets (c) 1.05%(b)(d)2.07%(d) 1.72%(d) 1.60%(d) 1.52%(d) 1.24%
Ratio of Net
Investment Income
(Loss) to Average
Net Assets(c) (0.17%)(b) 0.25% (0.44%) (0.04%) 0.37% 0.28%
Portfolio Turnover
Rate 89%(b) 114% 86% 70% 56% 70%
(a) Distributions in excess of net investment income for the years ended
October 31, 1998, 1997 and 1996 aggregated less than $0.01 on a per share
basis.
(b) Based on operations for the period shown and, accordingly, are not
representative of a full year. (c)Various expenses of the Fund were
voluntarily absorbed by IFG for the six months ended April 30, 1999
and the year ended October 31, 1998. If such expenses had not been
voluntarily absorbed, ratio of expenses to average net assets would have
been 1.31% (not annualized) and 2.56%, respectively, and ratio of net
investment income (loss) to average net assets would have been (0.43%)
(not annualized) and (0.24%), respectively.
(d) Ratio is based on Total Expenses of the Fund, less Expenses Absorbed
by Investment Adviser, if applicable, which is before any expense
offset arrangements.
<PAGE>
OTHER INFORMATION
- --------------------------------------------------------------------------------
UNAUDITED
On May 20, 1999, a special meeting of the shareholders of each Fund was held at
which the ten directors identified below were elected. The selection of
PricewaterhouseCoopers LLP as independent accountants (Proposal 1) and the
approval of changes to the fundamental investment restrictions identified below
(Proposal 2) were ratified. The following is a report of the votes cast:
WITHHELD/
NOMINEE/PROPOSAL FOR AGAINST ABSTAIN TOTAL
- --------------------------------------------------------------------------------
EUROPEAN FUND
Charles W. Brady 21,467,745 0 1,065,343 22,533,088
Fred A. Deering 21,495,106 0 1,037,982 22,533,088
Mark H. Williamson 21,474,178 0 1,058,910 22,533,088
Dr. Victor L. Andrews 21,488,078 0 1,045,010 22,533,088
Bob R. Baker 21,507,462 0 1,025,626 22,533,088
Lawrence H. Budner 21,515,155 0 1,017,933 22,533,088
Dr. Wendy Lee Gramm 21,520,844 0 1,012,244 22,533,088
Kenneth T. King 21,496,517 0 1,036,571 22,533,088
John W. McIntyre 21,511,701 0 1,021,387 22,533,088
Dr. Larry Soll 21,515,708 0 1,017,380 22,533,088
Proposal 1 21,474,368 317,526 741,194 22,533,088
Proposal 2
Modification of Fundamental
Investment Restrictions on:
a -- The issuance of senior
securities 15,597,311 1,131,660 5,804,117 22,533,088
b --Borrowing and adoption
of non-fundamental
restriction on borrowing 15,594,393 1,134,578 5,804,117 22,533,088
c --Investing in commodities 15,590,682 1,138,289 5,804,117 22,533,088
d --Real estate investments 15,597,907 1,131,064 5,804,117 22,533,088
e --Investing in another
investment company 15,590,572 1,138,399 5,804,117 22,533,088
f --Underwriting securities 15,598,910 1,130,061 5,804,117 22,533,088
g --Loans 15,597,562 1,131,409 5,804,117 22,533,088
h --Issuer diversification 15,596,934 1,132,037 5,804,117 22,533,088
i --Industry concentration
and adoption of non-
fundamental interpretation
on classification of
foreign governments for
concentration purposes 15,597,907 1,131,064 5,804,117 22,533,088
Elimination of Fundamental
Investment Restrictions on:
j -- Investing in illiquid
securities and adoption of
non-fundamental restriction
on investing in illiquid
securities 15,588,736 1,140,235 5,804,117 22,533,088
<PAGE>
OTHER INFORMATION (CONTINUED)
- --------------------------------------------------------------------------------
WITHHELD/
NOMINEE/PROPOSAL FOR AGAINST ABSTAIN TOTAL
- --------------------------------------------------------------------------------
EUROPEAN FUND (CONTINUED)
k -- Short sales and margin
transactions and adoption of
non-fundamental restriction
on short sales and margin
transactions 15,595,320 1,133,651 5,804,117 22,533,088
l -- Investments in companies
for the purpose of
exercising control or
management 15,595,480 1,133,491 5,804,117 22,533,088
m -- Fund ownership of
securities also owned by
directors and officers of
each Fund or its investment
advisor 15,595,320 1,133,651 5,804,117 22,533,088
n -- Investing in newly
formed issuers 15,595,917 1,133,054 5,804,117 22,533,088
INTERNATIONAL BLUE CHIP FUND
Charles W. Brady 1,431,727 0 2,966 1,434,693
Fred A. Deering 1,431,692 0 3,001 1,434,693
Mark H. Williamson 1,431,827 0 2,866 1,434,693
Dr. Victor L. Andrews 1,431,827 0 2,866 1,434,693
Bob R. Baker 1,431,692 0 3,001 1,434,693
Lawrence H. Budner 1,431,827 0 2,866 1,434,693
Dr. Wendy Lee Gramm 1,432,059 0 2,634 1,434,693
Kenneth T. King 1,432,094 0 2,599 1,434,693
John W. McIntyre 1,432,094 0 2,599 1,434,693
Dr. Larry Soll 1,432,094 0 2,599 1,434,693
Proposal 1 1,428,751 1,720 4,221 1,434,692
Proposal 2
Modification of Fundamental
Investment Restrictions on:
a -- The issuance of senior
securities 1,419,793 8,910 5,990 1,434,693
b --Borrowing and adoption
of non-fundamental
restriction on borrowing 1,419,793 8,910 5,990 1,434,693
c --Investing in commodities 1,419,793 8,910 5,990 1,434,693
d --Real estate investments 1,419,793 8,910 5,990 1,434,693
e --Investing in another
investment company 1,419,793 8,910 5,990 1,434,693
f --Underwriting securities 1,419,793 8,910 5,990 1,434,693
g --Loans 1,419,793 8,910 5,990 1,434,693
h --Issuer diversification 1,419,793 8,910 5,990 1,434,693
i --Industry concentration and
adoption of non-fundamental
interpretation on
classification of foreign
governments for
concentration purposes 1,419,793 8,910 5,990 1,434,693
<PAGE>
OTHER INFORMATION (CONTINUED)
- --------------------------------------------------------------------------------
WITHHELD/
NOMINEE/PROPOSAL FOR AGAINST ABSTAIN TOTAL
- --------------------------------------------------------------------------------
INTERNATIONAL BLUE CHIP FUND (CONTINUED)
Elimination of Fundamental
Investment Restrictions on:
j -- Investing in illiquid
securities and adoption of
non-fundamental restriction
on investing in illiquid
securities 1,419,793 8,910 5,990 1,434,693
k -- Short sales and margin
transactions and adoption of
non-fundamental restriction
on short sales and margin
transactions 1,419,793 8,910 5,990 1,434,693
l --Investments in companies
for the purpose of
exercising control or
management 1,419,793 8,910 5,990 1,434,693
m --Fund ownership of
securities also owned by
directors and officers of
each Fund or its investment
advisor 1,419,793 8,910 5,990 1,434,693
PACIFIC BASIN FUND
Charles W. Brady 3,617,515 0 445,429 4,062,944
Fred A. Deering 3,615,456 0 447,488 4,062,944
Mark H. Williamson 3,614,809 0 448,135 4,062,944
Dr. Victor L. Andrews 3,610,965 0 451,979 4,062,944
Bob R. Baker 3,619,124 0 443,820 4,062,944
Lawrence H. Budner 3,619,450 0 443,494 4,062,944
Dr. Wendy Lee Gramm 3,619,450 0 443,494 4,062,944
Kenneth T. King 3,619,450 0 443,494 4,062,944
John W. McIntyre 3,619,450 0 443,494 4,062,944
Dr. Larry Soll 3,619,450 0 443,494 4,062,944
Proposal 1 3,798,015 106,167 158,762 4,062,944
Proposal 2
Modification of Fundamental
Investment Restrictions on:
a -- The issuance of senior
securities 2,966,023 518,435 578,486 4,062,944
b --Borrowing and adoption
of non-fundamental
restriction on borrowing 2,964,131 520,327 578,486 4,062,944
c --Investing in commodities 2,964,131 520,327 578,486 4,062,944
d --Real estate investments 2,965,630 518,828 578,486 4,062,944
e --Investing in another
investment company 2,963,966 520,492 578,486 4,062,944
f --Underwriting securities 2,965,630 518,828 578,486 4,062,944
g --Loans 2,966,023 518,435 578,486 4,062,944
h --Issuer diversification 2,966,023 518,435 578,486 4,062,944
<PAGE>
OTHER INFORMATION (CONTINUED)
- --------------------------------------------------------------------------------
WITHHELD/
NOMINEE/PROPOSAL FOR AGAINST ABSTAIN TOTAL
- --------------------------------------------------------------------------------
PACIFIC BASIN FUND (CONTINUED)
i -- Industry concentration and
adoption of non-fundamental
interpretation on
classification of foreign
governments for
concentration purposes 2,964,484 519,974 578,486 4,062,944
Elimination of Fundamental
Investment Restrictions on:
j -- Investing in illiquid
securities and adoption of
non-fundamental restriction
on investing in illiquid
securities 2,964,131 520,327 578,486 4,062,944
k -- Short sales and margin
transactions and adoption of
non-fundamental restriction
on short sales and margin
transactions 2,963,966 520,492 578,486 4,062,944
l -- Investments in companies
for the purpose of
exercising control or
management 2,964,484 519,974 578,486 4,062,944
m -- Fund ownership of
securities also owned by
directors and officers of
each Fund or its investment
advisor 2,964,131 520,327 578,486 4,062,944
n --Investing in newly formed
issuers 2,964,877 519,581 578,486 4,062,944
<PAGE>
YEAR 2000 COMPUTER ISSUE
Many computer systems in use today may not be able to recognize any date after
December 31, 1999. If these systems are not fixed by that date, it is possible
that they could generate erroneous information or fail altogether. INVESCO has
committed substantial resources in an effort to make sure that its own major
computer systems will continue to function on and after January 1, 2000. Of
course, INVESCO cannot fix systems that are beyond its control. If INVESCO's own
systems, or the systems of third parties upon which it relies, do not perform
properly after December 31, 1999, the Funds could be adversely affected.
In addition, the markets for, or values of, securities in which the Funds
invest may possibly be hurt by computer failures affecting portfolio investments
or trading of securities beginning January 1, 2000. For example, improperly
functioning computer systems could result in securities trade settlement
problems and liquidity issues, production issues for individual companies and
overall economic uncertainties. Individual issuers may incur increased costs in
making their own systems Year 2000 compliant. The combination of market
uncertainty and increased costs means that there is a possibility that Year 2000
computer issues may adversely affect the Funds' investments. At this time, it is
generally believed that foreign issues, particularly those in emerging and other
markets, may be more vulnerable to Year 2000 problems than will be issuers in
the U.S.
<PAGE>
INVESCO Family Of Funds
Newspaper
Fund Name Fund Code Ticker Symbol Abbreviation
- --------------------------------------------------------------------------------
International
International Blue Chip 09 IIBCX ItlBlChp
Pacific Basin 54 FPBSX PcBas
European 56 FEURX Europ
Latin American Growth 34 IVSLX LtnAmerGr
- --------------------------------------------------------------------------------
Sector
Energy 50 FSTEX Enrgy
Financial Services 57 FSFSX FinSvc
Gold 51 FGLDX Gold
Health Sciences 52 FHLSX HlthSc
Leisure 53 FLISX Leisur
Realty 42 IVSRX Realty
Technology-Class II 55 FTCHX Tech
Utilities 58 FSTUX Util
Worldwide Communications 39 ISWCX WldCom
- --------------------------------------------------------------------------------
Stock
Growth & Income 21 IVGIX Gro&Inc
INVESCO Endeavor 61 IVENX Endeavor
Blue Chip Growth 10 FLRFX BlChpGro
Dynamics 20 FIDYX Dynm
Small Company Growth 60 FIEGX SmCoGth
Value Equity 46 FSEQX ValEq
S&P 500 Index Fund-Class II 23 ISPIX SP500II
- --------------------------------------------------------------------------------
Combination Stock & Bond
Industrial Income 15 FIIIX IndInc
Total Return 48 FSFLX TotRtn
Balanced 71 IMABX Bal
- --------------------------------------------------------------------------------
Bond
U.S. Government Securities 32 FBDGX USGvt
Select Income 30 FBDSX SelInc
High Yield 31 FHYPX HiYld
- --------------------------------------------------------------------------------
Tax-Exempt
Tax-Free Bond 35 FTIFX TxFre
- --------------------------------------------------------------------------------
Money Market
U.S. Government Money Fund 44 FUGXX InvGvtMF
Cash Reserves 25 FDSXX InvCshR
Tax-Free Money Fund 40 FFRXX InvTaxFree
Money Market Reserve 96 IMRXX INVESCOMMR
Tax-Exempt Reserve 95 ITTXX INVESCOTTE
FOR MORE INFORMATION ABOUT ANY OF THE INVESCO FUNDS, INCLUDING MANAGEMENT FEES
AND EXPENSES, PLEASE CALL US AT 1-800-525-8085 FOR A PROSPECTUS. READ IT
CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
<PAGE>
[INVESCO ICON]
INVESCO
YOU SHOULD
KNOW WHAT
INVESCO KNOWS (TM)
We're easy to stay in touch with:
Investor Services: 1-800-525-8085
PAL(R), your personal account line: 1-800-424-8085
On the World Wide Web: www.invesco.com
In Denver, visit one of our convenient Investor Centers:
Cherry Creek,
3003 East Third Avenue, Suite 1
Denver Tech Center,
7800 East Union Avenue,
Lobby Level
INVESCO Distributors, Inc.,(SM)
Distributor
Post Office Box 173706
Denver, CO 80217-3706
This information must be preceded or accompanied by a current prospectus.
SINT 9010 5/99
