Annual
Report
MARCH 31, 1999
TEMPLETON GLOBAL
INFRASTRUCTURE FUND
[LOGO (R)]
[Franklin(R) Templeton(R)]
PAGE
[Celebrating Over 50 Years LOGO]
[PHOTO OF MARK G. HOLOWESKO APPEARS HERE]
MARK G. HOLOWESKO, CFA
President
Templeton Global Investment Trust
Thank you for investing with Franklin Templeton. We encourage our investors to
maintain a long-term perspective, and to expect that mixed in with the good
years can be some bad years. It's important to remember that all securities
markets move both up and down, as do mutual fund share prices. We appreciate
your past support and look forward to serving your investment needs in the years
ahead.
In 1992, Sir John Templeton retired after a 50-year career of helping investors
manage their money. Currently he devotes all of his time and efforts to the John
Templeton Foundation. A major portion of his assets remain invested in the
Templeton funds, which are managed by many of the investment professionals he
selected and trained.
PAGE
CONTENTS
Shareholder Letter ................... 1
Performance Summaries ................ 5
Financial Highlights &
Statement of Investments ............. 8
Financial Statements ................. 13
Notes to Financial
Statements ........................... 16
Independent Auditors' Report ......... 20
Tax Designation ...................... 21
[PYRAMID GRAPHIC]
FUND CATEGORY - GLOBAL
GROWTH
GROWTH & INCOME
INCOME
TAX-FREE INCOME
SHAREHOLDER LETTER
- -------------------------------------------------------------------------------
Your Fund's Goal: Templeton Global Infrastructure Fund seeks long-term capital
growth. Under normal market conditions, the Fund invests at least 65% of its
total assets in the equity and debt securities of U.S. and foreign companies
that are principally engaged in or related to the development, operation or
rehabilitation of the physical and social infrastructures of any nation.
- -------------------------------------------------------------------------------
Dear Shareholder:
This report covers the fiscal year ended March 31, 1999. During this period,
large capitalization (cap) U.S. and European growth stocks in general continued
to perform extremely well. In the U.S., technology, pharmaceutical, and
financial services stocks helped to power the market to record highs. In Europe,
large-cap stocks were boosted by many investors' expectations that the euro's
advent would lead to opportunities for large companies to gain market share in
new markets. Although many Asian equity markets rebounded, most ended the period
below levels of the prior year. Due in large part to slackened demand, global
commodity prices, notably that of oil, also fell during the year. Within this
environment,
You will find a complete listing of the Fund's portfolio holdings, including
dollar value and number of shares or principal amount, beginning on page 10 of
this report.
PAGE
[GEOGRAPHIC DISTRIBUTION*
Based on Total Net Assets
3/31/99 Pie Chart]
[PIE CHART APPEARS HERE]
[THIS CHART SHOWS IN PIE FORMAT THE GEOPGRAPHIC DISTRIBUTION OF TEMPLETON GLOBAL
INFRASTRUCTURE FUND, BASED ON TOTAL NET ASSETS AS OF 3/31/99.]
Europe 39.3%
Latin America 19.7%
Asia 18.7%
United States 14.7%
Canada 5.7%
Australia & New Zealand 3.1%
*Short-term investments and other net assets represented - 1.2% of total net
assets.
Templeton Global Infrastructure Fund - Class A posted a - 11.85% one-year
cumulative total return, as shown in the Performance Summary on page 6. The
Morgan Stanley Capital International(R) (MSCI) World Index(1) and Goldman
Sachs(R) Extended Global Market Index(2), the Fund's benchmarks, returned 13.0%
and 11.4%, respectively, for the year ended March 31, 1999.
The Fund's underperformance, relative to its benchmarks, was due in large part
to the fact that, although we sold many of our larger-cap stocks at levels
well-above our sell targets, the small-cap stocks we purchased as replacements
did not perform as well as the expensive stocks we sold. For example, we sold
our holdings of several large telecommunications companies, such as Telefonica
de Espana; Koninklijke Ptt Nederland NV; Finnish-based Nokia AB, A; and Lucent
Technologies, Inc. of the U.S. We used the proceeds of such sales to purchase
shares of small-cap companies at what we considered bargain prices. Finding
several investment opportunities in Mexico and Hong Kong, we initiated positions
in Corporacion Geo SA, B, a builder of low-income housing in Mexico; Cementos de
Mexico SA (Cemex SA), a leading global cement company; and Hong Kong Aircraft
Engineering Co. Ltd., an aircraft maintenance firm. In our opinion, each of
these companies is well-positioned in its industry.
1. Source: Standard and Poor's(R) Micropal. The unmanaged MSCI World Index
tracks the performance of approximately 1,450 securities in 22 countries and is
designed to measure world stock market performance. It includes reinvested
dividends. One cannot invest directly in an index, nor is an index
representative of the Fund's portfolio.
2. Source: Standard and Poor's Micropal. The unmanaged Goldman Sachs Extended
Global Market Index is a combination of the Financial Times of London -
Actuaries World Index and the International Finance Corporation Investable
Composite Index, and tracks equity securities in markets around the world. It
includes reinvested dividends. One cannot invest directly in an index, nor is an
index representative of the Fund's portfolio.
2
PAGE
Elsewhere, we initiated positions in building products company Heywood Williams
Group PLC and machinery and engineering firm Bullough PLC, both located in the
United Kingdom; Arcadis NV, a Netherlands-based engineering company; and Confab
Industrial SA, a Brazilian producer of pipe for oil and gas pipelines. Other
shares we purchased during the period included India-based Housing Development
Finance Corp. Ltd. and French electronics company Alcatel SA.
Looking forward, we are optimistic about prospects for world equity markets and
the Fund. During the reporting period, we made investments for the portfolio at
what we considered attractive prices, and believe that our value-investing style
has the potential to benefit our shareholders in the long term. We intend to
maintain an overweighting in commodity-oriented stocks in the near term because,
in many cases, they have been trading at low price levels, and we believe they
may have significant upside potential. It is easy for value investors to become
discouraged during momentum markets, such as the one we have been experiencing,
but it is important to remember that we have a distinct investment style - one
that has not always been in favor, but has been successful in the past. Although
past performance is no guarantee of future results, we will continue to follow
our investment style, confident in the long-term potential we believe it offers
our shareholders.
There are, of course, special risks involved with global investing related to
market, currency, economic, social, political, and other factors. Emerging
markets securities involve heightened risks related to the same factors, in
addition to those associated
TOP 10 HOLDINGS
3/31/99
[THIS CHART LISTS THE TOP 10 HOLDINGS, INCLUDING INDUSTRY AND COUNTRY, OF
TEMPLETON GLOBAL INFRASTRUCTURE FUND, BASED ON TOTAL NET ASSETS AS OF 3/31/99.]
COMPANY, % OF TOTAL
INDUSTRY, COUNTRY NET ASSETS
- -------------------------------------------------
YPF Sociedad Anonima,
ADR,
Energy Sources, Argentina 2.9%
Mastec Inc.,
Telecommunications, U.S. 2.8%
Weir Group PLC,
Industrial Components,
United Kingdom 2.8%
Hong Kong
Telecommunications Ltd.,
Telecommunications,
Hong Kong* 2.8%
Svedala Industri, A,
Building Materials
& Components, Sweden 2.7%
First Tractor Company
Limited, H,
Machinery & Engineering, China 2.5%
Gradall Industries Inc.,
Machinery & Engineering, U.S. 2.4%
Guangshen Railway Co.
Ltd., H, ADR,
Transportation, China 2.3%
Hong Kong Electric
Holdings Ltd.,
Utilities Electrical & Gas,
Hong Kong* 2.3%
Metra OY, B,
Multi-Industry, Finland 2.2%
*Hong Kong reverted to the sovereignty of China on July 1, 1997.
3
PAGE
with the relatively small size and lesser liquidity of those markets. Investing
in any emerging market means accepting a certain amount of volatility and, in
some cases, the consequences of severe market corrections. For example, Taiwan's
equity market has increased 855% in the last 15 years, but has suffered six
declines of more than 20% during that time (3). While short-term volatility can
be disconcerting, declines exceeding 50% are not unusual in emerging markets.
These risks and other considerations are discussed in the Fund's prospectus.
Please remember, this discussion reflects our views, opinions and portfolio
holdings as of March 31, 1999, the end of the reporting period. However, market
and economic conditions are changing constantly, which can be expected to affect
our strategies and the Fund's portfolio composition. Although past performance
is not predictive of future results, these insights may give you a better
understanding of our investment and management philosophy.
We appreciate your participation in Templeton Global Infrastructure Fund and
welcome your comments or suggestions.
Sincerely,
/s/MARK G. HOLOWESKO
- ---------------------------
Mark G. Holowesko, CFA
President
Templeton Global Investment Trust
/s/TUCKER SCOTT
- ---------------------------
Tucker Scott
Portfolio Manager
Templeton Global Infrastructure Fund
3. Source: Bloomberg. Based on quarterly percentage price change over 15 years
ended March 31, 1999. Market return is measured in U.S. dollars and does not
include reinvested dividends.
4
PAGE
PERFORMANCE SUMMARY AS OF 3/31/99
Distributions will vary based on earnings of the Fund's portfolio and any
profits realized from the sale of the portfolio's securities, as well as the
level of each class' operating expenses. Past distributions are not indicative
of future trends. All total returns include reinvested distributions at net
asset value.
PRICE AND DISTRIBUTION INFORMATION (4/1/98 - 3/31/99)
<TABLE>
<CAPTION>
CLASS A CHANGE 3/31/99 3/31/98
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value -$2.37 $10.12 $12.49
DISTRIBUTIONS
-----------------------------------------------
Dividend Income $0.1100
Long-Term Capital Gain $0.8150
Short-Term Capital Gain $0.0250
TOTAL $0.9500
CLASS C CHANGE 12/31/98 12/31/97
- -------------------------------------------------------------------------------
Net Asset Value -$2.36 $10.01 $12.37
DISTRIBUTIONS
-----------------------------------------------
Dividend Income $0.0447
Long-Term Capital Gain $0.8150
Short-Term Capital Gain $0.0250
TOTAL $0.8847
</TABLE>
Templeton Global Infrastructure Fund paid distributions derived from long-term
capital gains of 68.5 cents ($0.685) per share in May, 1998, and 13.0 cents
($0.13) per share in December, 1998. The Fund hereby designates such
distributions as capital gain dividends per Internal Revenue Code Section 852
(b)(3).
CLASS A (formerly Class I):
Subject to the maximum 5.75% initial sales charge. From March 14, 1994, through
April 15, 1995, fee waivers and expense reimbursements by the Fund's Business
Manager increased the Fund's total return. Without these fee waivers and expense
reimbursements, total returns for Class A shares would have been lower.
CLASS C (formerly Class II):
Subject to 1% initial sales charge and 1% contingent deferred sales charge for
shares redeemed within 18 months of investment. These shares have higher annual
fees and expenses than Class A shares.
Past performance is not predictive of future results.
5
PAGE
1. Cumulative total return represents the change in value of an investment over
the periods indicated and does not include sales charges.
2. Average annual total return represents the average annual change in value of
an investment over the periods indicated and includes the applicable, maximum
sales charge(s) for that class.
3. These figures represent the value of a hypothetical $10,000 investment in the
Fund over the periods indicated and includes the applicable, maximum sales
charge(s) for that class.
4. One-year total return represents the change in value of an investment over
the one-year periods ended on the specified dates and does not include sales
charges.
Since markets can go down as well as up, investment return and principal value
will fluctuate with market conditions, currency volatility and the social,
economic and political climates of countries where the Fund invests. Emerging
markets involve heightened risks related to the same factors, in addition to
those associated with their relatively small size and lesser liquidity. You may
have a gain or loss when you sell your shares.
PERFORMANCE
<TABLE>
<CAPTION>
INCEPTION
CLASS A 1-YEAR 5-YEAR (3/14/94)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Cumulative Total Return(1) -11.85% 24.58% 24.70%
Average Annual Total Return(2) -16.91% 3.26% 3.25%
Value of $10,000 Investment(3) $8,309 $11,742 $11,753
3/31/95 3/31/96 3/31/97 3/31/98 3/31/99
--------------------------------------------------------------------
One-Year
Total Return(4) -5.41% 11.79% 16.22% 15.00% -11.85%
INCEPTION
CLASS C 1-YEAR 5-YEAR (5/1/95)
- --------------------------------------------------------------------------------------------------------------
Cumulative Total Return(1) -12.47% 15.36% 24.45%
Average Annual Total Return(2) -14.11% 4.53% 5.47%
Value of $10,000 Investment(3) $8,589 $11,421 $12,319
3/31/97 3/31/98 3/31/99
--------------------------------------
One-Year
Total Return(4) 15.48% 14.13% -12.47%
</TABLE>
Past performance is not predictive of future results.
6
PAGE
TOTAL RETURN INDEX COMPARISON
FOR HYPOTHETICAL $10,000 INVESTMENT
Total return represents the change in value of an investment over the periods
shown. It includes the applicable, maximum sales charge(s), Fund expenses,
account fees and reinvested distributions. The unmanaged indices differ from the
Fund in composition, do not pay management fees or expenses and include
reinvested dividends. One cannot invest directly in an index.
CLASS A
Total Return Index Comparison
$10,000 Investment (3/14/94 - 3/31/99)
[THE FOLLOWING LINE GRAPH COMPARES THE PERFORMANCE OF TEMPLETON GLOBAL
INFRASTRUCTURE FUND- CLASS A TO THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD
INDEX AND GOLDMAN SACHS EXTENDED GLOBAL MARKET WORLD INDEX, BASED ON A $10,000
INVESTMENT FROM 3/14/94 TO 3/31/99.]
TEMPLETON GLOBAL MSCI WORLD GOLDMAN SACHS
INFRASTRUCTURE INDEX EGMI WORLD
FUND - CLASS A* INDEX
----------------------------------------------
3/14/94 $9,425 $10,000 $10,000
3/94 $9,434 $9,760 $9,771
4/94 $9,491 $10,063 $10,056
5/94 $9,500 $10,091 $10,096
6/94 $9,406 $10,065 $10,087
7/94 $9,632 $10,258 $10,291
8/94 $9,811 $10,568 $10,623
9/94 $9,746 $10,293 $10,360
10/94 $9,868 $10,587 $10,644
11/94 $9,387 $10,130 $10,173
12/94 $9,284 $10,230 $10,245
1/95 $8,924 $10,078 $10,058
2/95 $8,924 $10,227 $10,140
3/95 $8,924 $10,722 $10,636
4/95 $9,199 $11,098 $11,023
5/95 $9,563 $11,195 $11,095
6/95 $9,724 $11,194 $11,062
7/95 $10,379 $11,756 $11,628
8/95 $9,962 $11,496 $11,367
9/95 $10,009 $11,833 $11,669
10/95 $9,354 $11,649 $11,474
11/95 $9,297 $12,056 $11,860
12/95 $9,450 $12,411 $12,211
1/96 $9,897 $12,637 $12,458
2/96 $10,066 $12,716 $12,518
3/96 $9,976 $12,931 $12,705
4/96 $10,572 $13,237 $13,031
5/96 $10,816 $13,250 $13,029
6/96 $10,646 $13,320 $13,083
7/96 $10,257 $12,852 $12,601
8/96 $10,636 $13,002 $12,760
9/96 $10,736 $13,514 $13,254
10/96 $10,616 $13,610 $13,323
11/96 $11,296 $14,375 $14,039
12/96 $11,423 $14,148 $13,820
1/97 $11,996 $14,320 $13,982
2/97 $11,755 $14,488 $14,160
3/97 $11,594 $14,204 $13,852
4/97 $11,755 $14,670 $14,256
5/97 $12,457 $15,579 $15,198
6/97 $12,885 $16,358 $15,934
7/97 $13,628 $17,114 $16,674
8/97 $13,404 $15,972 $15,612
9/97 $13,923 $16,841 $16,441
10/97 $12,467 $15,958 $15,503
11/97 $12,203 $16,243 $15,723
12/97 $12,073 $16,443 $15,930
1/98 $11,817 $16,904 $16,304
2/98 $12,554 $18,050 $17,426
3/98 $13,333 $18,815 $18,151
4/98 $13,312 $19,002 $18,314
5/98 $12,666 $18,767 $18,019
6/98 $12,086 $19,215 $18,341
7/98 $11,927 $19,186 $18,291
8/98 $9,574 $16,631 $15,689
9/98 $9,903 $16,928 $16,032
10/98 $10,892 $18,461 $17,532
11/98 $11,222 $19,562 $18,567
12/98 $11,021 $20,521 $19,469
1/99 $11,021 $20,973 $19,874
2/99 $10,859 $20,417 $19,344
3/99 $11,753 $21,271 $20,213
AVERAGE ANNUAL TOTAL RETURN
3/31/99
CLASS A
- ---------------------------------------
1-Year -16.91%
5-Year 3.26%
Since Inception (3/14/94) 3.25%
CLASS C
Total Return Index Comparison
$10,000 Investment (5/1/95 - 3/31/99)
[THE FOLLOWING LINE GRAPH COMPARES THE PERFORMANCE OF TEMPLETON GLOBAL
INFRASTRUCTURE FUND - CLASS C TO THE MORGAN STANLEY CAPITAL INTERNATIONAL WORLD
INDEX AND GOLDMAN SACHS GLOBAL MARKET WORLD INDEX, BASED ON A $10,000 INVESTMENT
FROM 5/1/95 TO 3/31/99.]
TEMPLETON GLOBAL MSCI GOLDMAN SACHS
INFRASTRUCTURE WORLD EGMI WORLD
FUND - CLASS C* INDEX INDEX
--------------------------------------------
5/1/95 $9,898 $10,000 $10,000
5/95 $10,290 $10,088 $10,065
6/95 $10,454 $10,086 $10,036
7/95 $11,149 $10,593 $10,549
8/95 $10,699 $10,359 $10,312
9/95 $10,740 $10,663 $10,587
10/95 $10,035 $10,497 $10,410
11/95 $9,963 $10,863 $10,760
12/95 $10,123 $11,183 $11,078
1/96 $10,614 $11,387 $11,302
2/96 $10,785 $11,458 $11,357
3/96 $10,679 $11,651 $11,526
4/96 $11,309 $11,927 $11,822
5/96 $11,574 $11,940 $11,820
6/96 $11,381 $12,002 $11,869
7/96 $10,951 $11,581 $11,432
8/96 $11,370 $11,716 $11,576
9/96 $11,467 $12,177 $12,024
10/96 $11,316 $12,264 $12,087
11/96 $12,047 $12,953 $12,736
12/96 $12,170 $12,748 $12,537
1/97 $12,772 $12,904 $12,685
2/97 $12,514 $13,054 $12,846
3/97 $12,331 $12,799 $12,567
4/97 $12,493 $13,219 $12,934
5/97 $13,241 $14,038 $13,788
6/97 $13,677 $14,739 $14,455
7/97 $14,461 $15,421 $15,127
8/97 $14,211 $14,392 $14,163
9/97 $14,755 $15,175 $14,915
10/97 $13,209 $14,379 $14,064
11/97 $12,915 $14,636 $14,264
12/97 $12,777 $14,816 $14,452
1/98 $12,504 $15,232 $14,791
2/98 $13,266 $16,265 $15,809
3/98 $14,074 $16,954 $16,467
4/98 $14,051 $17,122 $16,615
5/98 $13,369 $16,910 $16,347
6/98 $12,739 $17,314 $16,639
7/98 $12,557 $17,288 $16,593
8/98 $10,075 $14,985 $14,233
9/98 $10,426 $15,253 $14,545
10/98 $11,455 $16,635 $15,905
11/98 $11,782 $17,627 $16,844
12/98 $11,580 $18,491 $17,663
1/99 $11,568 $18,898 $18,029
2/99 $11,396 $18,398 $17,549
3/99 $12,319 $19,167 $18,338
AVERAGE ANNUAL TOTAL RETURN
3/31/99
- ---------------------------------------
1-Year -14.11%
3-Year 4.53%
Since Inception (5/1/95) 5.47%
*Source: Standard and Poor's(R) Micropal. MSCI World Index tracks the
performance of approximately 1,450 securities in 22 countries and is designed to
measure world stock market performance.
**Source: Standard and Poor's Micropal. Goldman Sachs EGMI is a combination of
the Financial Times of London - Actuaries World Index and the International
Finance Corporation Investable Composite Index, and tracks equity securities in
markets around the world.
Indices are unmanaged and include reinvested dividends. One cannot invest
directly in an index, nor is an index representative of the Fund's portfolio.
Past performance is not predictive of future results.
7
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Financial Highlights
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------
YEAR ENDED MARCH 31,
------------------------------------------------------------
1999 1998 1997 1996 1995
--------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(For a share outstanding throughout the year)
Net asset value, beginning of year......................... $12.49 $11.54 $10.04 $9.43 $10.01
------------------------------------------------------------
Income from investment operations:
Net investment income..................................... .16 .12 .17 .04 .07
Net realized and unrealized gains (losses)................ (1.58) 1.54 1.45 1.03 (.61)
------------------------------------------------------------
Total from investment operations........................... (1.42) 1.66 1.62 1.07 (.54)
------------------------------------------------------------
Less distributions from:
Net investment income..................................... (.11) (.18) (.07) (.05) (.04)
Net realized gains........................................ (.77) (.53) (.05) (.41) --
In excess of net realized gains........................... (.07) -- -- -- --
------------------------------------------------------------
Total distributions........................................ (.95) (.71) (.12) (.46) (.04)
------------------------------------------------------------
Net asset value, end of year............................... $10.12 $12.49 $11.54 $10.04 $9.43
============================================================
Total Return*.............................................. (11.85)% 15.00% 16.22% 11.79% (5.41)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's)............................ $15,647 $28,910 $28,011 $21,590 $18,717
Ratios to average net assets:
Expenses.................................................. 2.17% 1.82% 2.08% 2.32% 1.25%
Expenses, excluding waiver and payments by affiliate...... 2.17% 1.82% 2.08% 2.37% 3.25%
Net investment income..................................... 1.27% .89% 1.59% .40% 1.38%
Portfolio turnover rate.................................... 56.24% 27.26% 23.52% 38.22% 3.21%
</TABLE>
*Total return does not reflect sales commissions.
8
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Financial Highlights (continued)
<TABLE>
<CAPTION>
CLASS C
--------------------------------------------
YEAR ENDED MARCH 31,
--------------------------------------------
1999 1998 1997 1996+
-----------------------------------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
(For a share outstanding throughout the year)
Net asset value, beginning of year.......................... $12.37 $11.46 $9.99 $9.73
--------------------------------------------
Income from investment operations:
Net investment income (loss)............................... .06 .03 .11 (.02)
Net realized and unrealized gains (losses)................. (1.53) 1.52 1.43 .73
--------------------------------------------
Total from investment operations............................ (1.47) 1.55 1.54 .71
--------------------------------------------
Less distributions from:
Net investment income...................................... (.05) (.11) (.02) (.04)
Net realized gains......................................... (.77) (.53) (.05) (.41)
In excess of net realized gains............................ (.07) -- -- --
--------------------------------------------
Total distributions......................................... (.89) (.64) (.07) (.45)
--------------------------------------------
Net asset value, end of year................................ $10.01 $12.37 $11.46 $9.99
=============================================
Total Return*............................................... (12.47)% 14.13% 15.48% 7.66%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (000's)............................. $2,996 $4,209 $2,844 $1,379
Ratios to average net assets:
Expenses................................................... 2.81% 2.47% 2.73% 2.97%**
Net investment income (loss)............................... .60% .17% .98% (.88)%**
Portfolio turnover rate..................................... 56.24% 27.26% 23.52% 38.22%
</TABLE>
*Total return does not reflect sales commissions or the contingent deferred
sales charge and is not annualized.
**Annualized.
+For the period May 1, 1995 (effective date) to March 31, 1996.
See Notes to Financial Statements.
9
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
STATEMENT OF INVESTMENTS, MARCH 31, 1999
<TABLE>
<CAPTION>
COUNTRY SHARES VALUE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS 99.4%
AEROSPACE & MILITARY TECHNOLOGY .7%
Hong Kong Aircraft Engineering Co. Ltd. .................... Hong Kong 95,000 $ 139,750
-----------
AUTOMOBILES 1.8%
Autoliv Inc. ............................................... Sweden 5,700 214,106
Weifu Fuel Injection Co. Ltd., B............................ China 515,000 116,297
-----------
330,403
-----------
BANKING .5%
*Hambrecht & Quist Group Inc. .............................. United States 3,000 104,063
-----------
BUILDING MATERIALS & COMPONENTS 9.9%
Anglian Group PLC........................................... United Kingdom 25,000 113,607
Cementos Diamante SA, ADR, 144A............................. Colombia 28,500 37,406
Cemex SA.................................................... Mexico 80,000 326,265
Det Danske Traelastkompagni AS.............................. Denmark 4,300 293,558
Heywood Williams Group PLC.................................. United Kingdom 80,000 309,947
Plettac AG.................................................. Germany 2,100 111,544
Svedala Industri, A......................................... Sweden 28,500 497,355
Williams PLC................................................ United Kingdom 25,000 161,330
-----------
1,851,012
-----------
BUSINESS & PUBLIC SERVICES .5%
*Magellan Health Services Inc. ............................. United States 25,000 104,688
-----------
CONSTRUCTION & HOUSING 1.1%
Fletcher Challenge Building Ltd., ADR....................... New Zealand 15,600 205,725
-----------
DATA PROCESSING & REPRODUCTION 4.0%
*3Com Corp. ................................................ United States 14,000 326,375
*Newbridge Networks Corp. .................................. Canada 13,400 415,400
-----------
741,775
-----------
ELECTRICAL & ELECTRONICS 5.5%
Alcatel SA.................................................. France 3,500 402,420
Koninklijke Philips Electronics NV.......................... Netherlands 5,000 407,279
Motorola Inc. .............................................. United States 3,000 219,750
-----------
1,029,449
-----------
ELECTRONIC COMPONENTS & INSTRUMENTS 3.0%
*ADC Telecommunications Inc. ............................... United States 3,000 143,063
Twentsche Kabel Holding NV.................................. Netherlands 13,500 408,088
-----------
551,151
-----------
ENERGY SOURCES 3.6%
*Ranger Oil Ltd. ........................................... Canada 31,100 124,400
YPF Sociedad Anonima, ADR................................... Argentina 17,200 542,875
-----------
667,275
-----------
FINANCIAL SERVICES 1.1%
Housing Development Finance Corp. Ltd. ..................... India 3,685 198,016
-----------
</TABLE>
10
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
STATEMENT OF INVESTMENTS, MARCH 31, 1999 (CONT.)
<TABLE>
<CAPTION>
COUNTRY SHARES VALUE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS (CONT.)
FOREST PRODUCTS & PAPER 2.3%
Munksjo AB.................................................. Sweden 39,000 $ 270,339
Weyerhaeuser Co. ........................................... United States 3,000 166,500
-----------
436,839
-----------
HEALTH & PERSONAL CARE 1.8%
*Internatio-Muller NV....................................... Netherlands 16,000 327,334
-----------
INDUSTRIAL COMPONENTS 4.1%
*Shaw Group Inc. ........................................... United States 9,400 131,013
Sylea SA.................................................... France 2,000 101,482
Weir Group PLC.............................................. United Kingdom 132,800 528,447
-----------
760,942
-----------
MACHINERY & ENGINEERING 15.3%
Arcadis NV.................................................. Netherlands 48,000 367,927
Bullough PLC................................................ United Kingdom 250,000 312,772
First Tractor Company Limited, H............................ China 2,414,000 457,908
*Gradall Industries Inc. ................................... United States 35,000 455,000
IHC Caland NV............................................... Netherlands 5,000 188,930
Maezawa Kyuso Industries Co. ............................... Japan 64,000 362,070
Mckechnie Group PLC......................................... United Kingdom 37,000 260,719
SNC-Lavalin Group Inc., A................................... Canada 31,800 245,941
VA Technologie AG, Br. ..................................... Austria 2,680 192,840
-----------
2,844,107
-----------
MERCHANDISING 1.9%
Grupo Imsa SA de CV, ADR.................................... Mexico 22,200 351,038
-----------
METALS & MINING 5.0%
British Steel PLC, ADR...................................... United Kingdom 18,700 377,506
Oregon Steel Mills Inc. .................................... United States 32,100 335,044
Pohang Iron & Steel Co. Ltd. ............................... South Korea 3,400 215,439
-----------
927,989
-----------
MULTI-INDUSTRY 2.2%
Metra OY, B................................................. Finland 20,600 415,883
-----------
REAL ESTATE 1.8%
*Corporacion Geo SA, B...................................... Mexico 110,000 319,861
Inversiones y Representacion SA, GDR........................ Argentina 400 10,550
-----------
330,411
-----------
TELECOMMUNICATIONS 18.5%
*Cable & Wireless Optus Ltd., 144A.......................... Australia 62,640 145,175
Compania Anonima Nacional Telefonos de Venezuela, ADR....... Venezuela 11,200 203,700
Hong Kong Telecommunications Ltd. .......................... Hong Kong 260,000 513,320
*Mastec Inc. ............................................... United States 23,000 529,000
*Millicom International Cellular SA......................... Luxembourg 9,100 236,600
Northern Telecom, Ltd. ..................................... Canada 4,500 279,563
SBC Communications Inc. .................................... Mexico 3,900 226,200
</TABLE>
11
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
STATEMENT OF INVESTMENTS, MARCH 31, 1999 (CONT.)
<TABLE>
<CAPTION>
COUNTRY SHARES VALUE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
COMMON STOCKS (CONT.)
TELECOMMUNICATIONS (CONT.)
Tele Celular Sul Participacoes SA........................... Brazil 109,665,900 $ 165,618
*Tele Centro Sul Participacoes SA........................... Brazil 14,665,900 68,412
Tele Sudeste Celular Participacoes SA....................... Brazil 39,665,900 141,086
Telecom Italia SpA, di Risp................................. Italy 30,050 178,723
Telefonica de Argentina SA, B, ADR.......................... Argentina 12,600 381,150
Telefonica del Peru SA, B................................... Peru 115,000 147,719
Telesp Participacoes SA..................................... Brazil 17,665,900 231,768
-----------
3,448,034
-----------
TRANSPORTATION 7.1%
Air New Zealand Ltd., B..................................... New Zealand 134,000 232,252
*Fritz Companies Inc. ...................................... United States 33,200 228,250
Guangshen Railway Co. Ltd., H, ADR.......................... China 75,750 426,094
*Osprey Maritime Ltd. ...................................... Singapore 449,500 149,530
Peninsular & Oriental Steam Navigation Co. ................. United Kingdom 20,000 291,221
-----------
1,327,347
-----------
UTILITIES ELECTRICAL & GAS 7.7%
Gener SA, ADR............................................... Chile 9,800 180,075
Hong Kong Electric Holdings Ltd. ........................... Hong Kong 139,500 422,125
Iberdrola SA, Br. .......................................... Spain 23,600 349,565
Korea Electric Power Corp. ................................. South Korea 12,300 296,724
Shandong Huaneng Power Development Co. Ltd., ADR............ China 49,400 185,250
-----------
1,433,739
-----------
TOTAL COMMON STOCKS (COST $19,170,582)...................... 18,526,970
-----------
PREFERRED STOCKS (COST $513,077) 1.8%
Confab Industrial SA, pfd. ................................. Brazil 441,000 347,143
-----------
TOTAL INVESTMENTS (COST $19,683,659) 101.2%................. 18,874,113
OTHER ASSETS, LESS LIABILITIES (1.2%)....................... (230,525)
-----------
TOTAL NET ASSETS 100.0%..................................... $18,643,588
===========
</TABLE>
*Non-income producing.
See Notes to Financial Statements.
12
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Financial Statements
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
<TABLE>
<S> <C>
Assets:
Investments in securities, at value (cost $19,683,659)..... $18,874,113
Receivables:
Investment securities sold................................ 541,966
Dividends and interest.................................... 130,664
-----------
Total assets.......................................... 19,546,743
-----------
Liabilities:
Payables:
Investment securities purchased........................... 290,394
Fund shares redeemed...................................... 65,451
To affiliates............................................. 38,593
Funds advanced by custodian................................ 458,654
Accrued expenses........................................... 50,063
-----------
Total liabilities..................................... 903,155
-----------
Net assets, at value........................................ $18,643,588
===========
Net assets consist of:
Undistributed net investment income........................ $ 93,146
Net unrealized depreciation................................ (809,546)
Distributions in excess of net realized gains.............. (119,722)
Beneficial shares.......................................... 19,479,710
-----------
Net assets, at value........................................ $18,643,588
===========
CLASS A:
Net asset value per share ($15,647,296 / 1,545,966 shares
outstanding)............................................. $10.12
===========
Maximum offering price per share ($10.12 / 94.25%)......... $10.74
===========
CLASS C:
Net asset value per share ($2,996,292 / 299,209 shares
outstanding)*............................................ $10.01
===========
Maximum offering price per share ($10.01 / 99.00%)......... $10.11
===========
</TABLE>
*Redemption price per share is equal to net asset value less any applicable
sales charge.
See Notes to Financial Statements.
13
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Financial Statements (continued)
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1999
<TABLE>
<S> <C> <C>
Investment Income:
(net of foreign taxes of $84,537)
Dividends.................................................. $826,635
Interest................................................... 17,452
--------
Total investment income............................... $ 844,087
Expenses:
Management fees (Note 3)................................... 184,332
Administrative fees (Note 3)............................... 36,866
Distribution fees (Note 3)
Class A................................................... 73,880
Class C................................................... 34,633
Transfer agent fees (Note 3)............................... 75,400
Custodian fees............................................. 23,800
Reports to shareholders.................................... 43,900
Registration and filing fees............................... 37,100
Professional fees.......................................... 27,700
Trustees' fees and expenses................................ 2,900
Amortization of organization costs......................... 14,103
Other...................................................... 123
--------
Total expenses........................................ 554,737
-----------
Net investment income........................... 289,350
-----------
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments............................................... 194,995
Foreign currency transactions............................. (30,424)
--------
Net realized gain..................................... 164,571
Net unrealized depreciation on investments............ (4,807,076)
-----------
Net realized and unrealized loss............................ (4,642,505)
-----------
Net decrease in net assets resulting from operations........ $(4,353,155)
===========
</TABLE>
See Notes to Financial Statements.
14
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Financial Statements (continued)
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED MARCH 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
----------------------
<S> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income..................................... $ 289,350 $ 273,899
Net realized gain from investments and foreign currency
transactions............................................ 164,571 3,099,177
Net unrealized appreciation (depreciation) on
investments.............................................. (4,807,076) 902,736
------------------------------
Net increase (decrease) in net assets resulting from
operations............................................ (4,353,155) 4,275,812
Distributions to shareholders from:
Net investment income:
Class A.................................................. (222,027) (422,396)
Class C.................................................. (15,650) (32,529)
Net realized gains:
Class A.................................................. (1,715,884) (1,282,490)
Class C.................................................. (276,417) (182,774)
In excess of net realized gains:
Class A.................................................. (101,764) --
Class C.................................................. (17,958) --
Beneficial share transactions (Note 2):
Class A.................................................. (7,454,694) (1,276,300)
Class C.................................................. (317,636) 1,184,703
------------------------------
Net increase (decrease) in net assets................... (14,475,185) 2,264,026
Net assets:
Beginning of year.......................................... 33,118,773 30,854,747
------------------------------
End of year................................................ $ 18,643,588 $33,118,773
==============================
Undistributed net investment income included in net assets:
End of year................................................ $ 93,146 $ 84,488
==============================
</TABLE>
See Notes to Financial Statements.
15
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Notes to Financial Statements
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Templeton Global Infrastructure Fund (the Fund), is a separate diversified
series of Templeton Global Investment Trust (the Trust), which is an open-end
investment company registered under the Investment Company Act of 1940. The Fund
seeks long-term capital growth. Under normal market conditions, the Fund invests
at least 65% of its total assets in the equity and debt securities of U.S. and
foreign companies that are principally engaged in or related to the development,
operation or rehabilitation of the physical and social infrastructures of any
nation. The following summarizes the Fund's significant accounting policies.
a. SECURITY VALUATION:
Securities listed or traded on a recognized national exchange or NASDAQ are
valued at the latest reported sales price. Over-the-counter securities and
listed securities for which no sale is reported are valued within the range of
the latest quoted bid and asked prices. Securities for which market quotations
are not readily available are valued at fair value as determined by management
in accordance with procedures established by the Board of Trustees.
b. FOREIGN CURRENCY TRANSLATION:
Portfolio securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the exchange rate of such
currencies against U.S. dollars on the date of valuation. Purchases and sales of
securities and income items denominated in foreign currencies are translated
into U.S. dollars at the exchange rate in effect on the transaction date. When
the Fund purchases or sells foreign securities it will customarily enter into a
foreign exchange contract to minimize foreign exchange risk from the trade date
to the settlement date of such transactions.
The Fund does not separately report the effect of changes in foreign exchange
rates from changes in market prices on securities held. Such changes are
included in net realized and unrealized gain or loss from investments.
Realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on securities transactions, and the difference between the recorded
amounts of dividends, interest and foreign withholding taxes, and the U.S.
dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains and losses arise from changes in foreign exchange rates
on foreign currency denominated assets and liabilities other than investments in
securities held at the end of the reporting period.
c. INCOME TAXES:
No provision has been made for income taxes because the Fund's policy is to
qualify as a regulated investment company under the Internal Revenue Code and to
distribute all of its taxable income.
16
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Notes to Financial Statements (continued)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONT.)
d. SECURITY TRANSACTIONS, INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS:
Security transactions are accounted for on trade date. Realized gains and losses
on security transactions are determined on a specific identification basis.
Certain income from foreign securities is recorded as soon as information is
available to the Fund. Interest income and estimated expenses are accrued daily.
Dividend income and distributions to shareholders are recorded on the
ex-dividend date.
Realized and unrealized gains and losses and net investment income, other than
class specific expenses, are allocated daily to each class of shares based upon
the relative proportion of net assets of each class.
Common expenses incurred by the Trust are allocated among the funds comprising
the Trust based on the ratio of net assets of each fund to the combined net
assets. Other expenses are charged to each fund on a specific identification
basis.
e. ACCOUNTING ESTIMATES:
The preparation of financial statements in accordance 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 amounts of income and expense during the reporting
period. Actual results could differ from those estimates.
2. BENEFICIAL SHARES
The Fund offers two classes of shares; Class A and Class C shares. Effective
January 1, 1999, Class I and Class II shares were renamed Class A and Class C
shares, respectively. The shares differ by their initial sales load,
distribution fees, voting rights on matters affecting a single class and the
exchange privilege of each class.
At March 31, 1999, there were an unlimited number of shares of beneficial
interest authorized ($0.01 par value). Transactions in the Fund's shares were as
follows:
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
-----------------------------------------------------------
1999 1998
-----------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
-----------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS A SHARES:
Shares sold................................................. 375,912 $ 3,653,450 608,694 $ 7,533,785
Shares issued on reinvestment of distributions.............. 176,318 1,945,594 141,485 1,611,708
Shares redeemed............................................. (1,320,960) (13,053,738) (862,774) (10,421,793)
-----------------------------------------------------------
Net decrease................................................ (768,730) $ (7,454,694) (112,595) $ (1,276,300)
===========================================================
</TABLE>
17
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Notes to Financial Statements (continued)
2. BENEFICIAL SHARES (CONT.)
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
-------------------------------------------------------
1999 1998
-------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS C SHARES:
Shares sold................................................. 80,830 $ 825,531 177,194 $ 2,175,334
Shares issued on reinvestment of distributions.............. 26,888 295,561 18,209 205,125
Shares redeemed............................................. (148,665) (1,438,728) (103,342) (1,195,756)
-------------------------------------------------------
Net increase (decrease)..................................... (40,947) $ (317,636) 92,061 $ 1,184,703
=======================================================
</TABLE>
3. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Certain officers of the Fund are also officers or directors of Templeton
Investment Counsel, Inc. (TICI), Franklin Templeton Services, Inc. (FT
Services), Franklin/Templeton Distributors, Inc. (Distributors) and
Franklin/Templeton Investor Services, Inc. (Investor Services), the Fund's
investment manager, administrative manager, principal underwriter and transfer
agent, respectively.
The Fund pays an investment management fee to TICI of 0.75% per year of the
average daily net assets of the Fund. The Fund pays its allocated share of an
administrative fee to FT Services based on the Trust's aggregate average daily
net assets as follows:
<TABLE>
<CAPTION>
ANNUALIZED
FEE RATE AVERAGE DAILY NET ASSETS
- --------------------------------------------------------------------------
<S> <C>
0.15% First $200 million
0.135% Over $200 million, up to and including $700 million
0.10% Over $700 million, up to and including $1.2 billion
0.075% Over $1.2 billion
</TABLE>
The Fund reimburses Distributors up to 0.35% and 1.00% per year of the average
daily net assets of Class A and Class C shares, respectively, for costs incurred
in marketing the Fund's Class A and Class C shares. Under the Class A
distribution plan, costs exceeding the maximum may be reimbursed in subsequent
periods. At March 31, 1999 the unreimbursed costs were $1,308,722. Distributors
received net commissions from sales of the Fund's shares and received contingent
deferred sales charges for the period of $9,002 and $4,225, respectively.
18
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Notes to Financial Statements (continued)
4. INCOME TAXES
The cost of securities for income tax purposes is the same as that shown in the
Statement of Investments. At March 31, 1999, the net unrealized depreciation
based on the cost of investments for income tax purposes was as follows:
<TABLE>
<S> <C>
Unrealized appreciation..................................... $ 2,420,188
Unrealized depreciation..................................... (3,229,734)
-----------
Net unrealized depreciation................................. $ (809,546)
===========
</TABLE>
At March 31, 1999 the Fund has deferred capital and currency losses occurring
subsequent to October 31, 1998 of $120,000. For tax purposes, such losses will
be reflected in the year ending March 31, 2000.
5. INVESTMENT TRANSACTIONS
Purchases and sales of securities (excluding short-term securities) for the year
ended March 31, 1999 aggregated $13,679,147 and $21,937,477, respectively.
6. FUND MERGER
The Fund's Board of Trustees approved a proposal to merge the Fund into
Templeton World Fund, subject to shareholder approval. It is anticipated that in
June 1999, shareholders will receive a proxy and proxy statement requesting
their vote on the proposal.
19
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
INDEPENDENT AUDITOR'S REPORT
The Board of Trustees and Shareholders
Templeton Global Infrastructure Fund
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Templeton Global Infrastructure Fund as of
March 31, 1999, and the related statement of operations for the year then ended,
the statements of changes in net assets for each of the two years in the period
then ended and the financial highlights for the periods indicated in the
accompanying financial statements. 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 March
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
Templeton Global Infrastructure Fund as of March 31, 1999, the results of its
operations, the changes in its net assets and the financial highlights for the
periods indicated, in conformity with generally accepted accounting principles.
/s/ McGladrey & Pullen, LLP
New York, New York
April 30, 1999
20
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Tax Designation
Under Section 852(b)(3)(C) of the Internal Revenue Code, the Templeton Global
Infrastructure Fund hereby designates $285,369 as a capital gain dividend for
the fiscal year ended March 31, 1999.
Under Section 854(b)(2) of the Internal Revenue Code, the Templeton Global
Infrastructure Fund hereby designates 23.38% of the ordinary income dividends as
income qualifying for the dividends received deduction for the fiscal year ended
March 31, 1999.
At March 31, 1999, more than 50% of the Templeton Global Infrastructure Fund's
total assets were invested in securities of foreign issuers. In most instances,
foreign taxes were withheld from dividends paid to the fund on these
investments. As in prior years, the Fund intends to make an election under
Section 853 of the Internal Revenue Code. This election will allow shareholders
to treat their proportionate share of foreign taxes paid by the Fund as having
been paid directly by them.
In January 2000, shareholders will receive Form 1099-DIV, which will include
their share of taxes withheld and foreign source income distributed during the
calendar year 1999.
21
PAGE
TEMPLETON GLOBAL INFRASTRUCTURE FUND
Tax Designation (continued)
The following table provides a breakdown by country of foreign source income and
foreign taxes paid to Class A and Class C shareholders in May 1999.
<TABLE>
<CAPTION>
CLASS A CLASS C
--------------------------------------------------------------------------------
FOREIGN TAXES FOREIGN SOURCE FOREIGN TAXES FOREIGN SOURCE
COUNTRY WITHHELD PER SHARE INCOME PER SHARE WITHHELD PER SHARE INCOME PER SHARE
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Argentina.................................... $ 0.0000 $0.0151 $ 0.0000 $0.0101
Australia.................................... 0.0005 0.0059 0.0005 0.0040
Austria...................................... 0.0006 0.0016 0.0006 0.0011
Brazil....................................... 0.0111 0.0356 0.0111 0.0237
Canada....................................... 0.0007 0.0023 0.0007 0.0016
Chile........................................ 0.0019 0.0029 0.0019 0.0019
China........................................ 0.0000 0.0196 0.0000 0.0131
Colombia..................................... 0.0000 0.0012 0.0000 0.0008
Denmark...................................... 0.0034 0.0071 0.0034 0.0047
Ecuador...................................... 0.0000 0.0035 0.0000 0.0024
Finland...................................... 0.0007 0.0019 0.0007 0.0013
Hong Kong.................................... 0.0000 0.0126 0.0000 0.0084
Indonesia.................................... 0.0001 0.0023 0.0001 0.0015
Italy........................................ 0.0005 0.0018 0.0005 0.0012
Japan........................................ 0.0006 0.0018 0.0006 0.0012
Luxembourg................................... 0.0000 0.0012 0.0000 0.0008
Mexico....................................... 0.0000 0.0053 0.0000 0.0035
Netherlands.................................. 0.0033 0.0090 0.0033 0.0060
New Zealand.................................. 0.0015 0.0040 0.0015 0.0027
Pakistan..................................... (0.0016) 0.0000 (0.0016) 0.0000
Peru......................................... 0.0000 0.0020 0.0000 0.0013
Portugal..................................... 0.0001 0.0001 0.0001 0.0000
Singapore.................................... 0.0003 0.0006 0.0003 0.0004
South Korea.................................. 0.0013 0.0033 0.0013 0.0022
Spain........................................ 0.0020 0.0056 0.0020 0.0037
Sweden....................................... 0.0031 0.0099 0.0031 0.0066
United Kingdom............................... 0.0117 0.0346 0.0117 0.0231
Venezuela.................................... 0.0000 0.0035 0.0000 0.0023
--------------------------------------------------------------------------------
TOTAL........................................ $ 0.0418 $0.1943 $ 0.0418 $0.1296
================================================================================
</TABLE>
22
PAGE
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PAGE
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PAGE
LITERATURE REQUEST
For a free brochure and prospectus, which contain more complete information,
including charges and expenses, call Franklin Templeton Fund Information at
1-800/DIAL BEN(R) (1-800/342-5236). Please read the prospectus carefully before
investing or sending money. To ensure the highest quality of service, telephone
calls to or from our service departments may be monitored, recorded and
accessed. These calls can be determined by the presence of a regular beeping
tone.
FRANKLIN TEMPLETON GROUP
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Valuemark Income Plus
(an immediate annuity)
1. These funds are now closed to new accounts, with the exception of retirement
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2. An investment in the fund is neither insured nor guaranteed by the U.S.
government or by any other entity or institution.
3. Two or more fund options available: long-term portfolio; portfolio of insured
securities; high yield portfolio (CA); intermediate-term and money market
portfolios (CA and NY).
4. Portfolio of insured municipal securities.
5. The fund may invest up to 100% of its assets in bonds that pay interest
subject to the federal alternative minimum tax.
6. Franklin Valuemark and Franklin Templeton Valuemark Income Plus are issued by
Allianz Life Insurance Company of North America or by its wholly owned
subsidiary, Preferred Life Insurance Company of New York, and distributed by
NALAC Financial Plans, LLC. The Franklin Valuemark Funds are managed by Franklin
Advisers, Inc. and its Templeton and Franklin affiliates.
04/99
PAGE
Bulk Rate
[FRANKLIN TEMPLETON LOGO] U.S. Postage
Templeton Global Infrastructure Fund PAID
777 Mariners Island Blvd., P.O. Box 7777 Permit No. 75
San Mateo, CA 94403-7777 Bell, CA
ANNUAL REPORT
AUDITORS
McGladrey & Pullen, LLP
555 Fifth Avenue
New York, New York 10017-2416
PRINCIPAL UNDERWRITER
Franklin/Templeton Distributors, Inc.
777 Mariners Island Blvd.
San Mateo, CA 94404-1585
1-800/DIAL BEN(R)
www.franklin-templeton.com
SHAREHOLDER SERVICES
1-800-632-2301
FUND INFORMATION
1-800-342-5236
This report must be preceded or accompanied by the current Templeton Global
Infrastructure Fund prospectus, which contains more complete information,
including risk factors, charges and expenses. Like any investment in securities,
the value of the Fund's portfolio will be subject to the risk of loss from
market, currency, economic, political and other factors, as well as investment
decisions by the Investment Manager, which will not always be profitable or
wise. The Fund and its investors are not protected from such losses by the
Investment Manager. Therefore, investors who cannot accept this risk should not
invest in shares of the Fund.
To ensure the highest quality of service, telephone calls to or from our service
departments may be monitored, recorded, and accessed. These calls can be
determined by the presence of a regular beeping tone.
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