<PAGE>
MARTIN CURRIE BUSINESS TRUST
GLOBAL GROWTH FUND
ANNUAL REPORT
APRIL 30, 1997
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
PROFILE AT APRIL 30, 1997
OBJECTIVE Long-term capital appreciation through active management of a
diversified portfolio of global equities.
LAUNCH DATE June 15, 1994
FUND SIZE $56.6m
PERFORMANCE Total return from May 1, 1996 through April 30, 1997
- MCBT - Global Growth Fund (excluding all
transaction fees) +8.9%
- MCBT - Global Growth Fund (including all
transaction fees) +7.2%
- The Morgan Stanley Capital International World
Index +10.8%
Annualized total return from June 15, 1994 through
April 30, 1997
- MCBT - Global Growth Fund (excluding all
transaction fees) +10.6%
- MCBT - Global Growth Fund (including all
transaction fees) +10.0%
The graph below represents the annualized total return of the
portfolio including all transaction fees versus the Morgan
Stanley Capital International World Index from July 1, 1994
through April 30, 1997.
- MCBT - Global Growth Fund (excluding all
transaction fees) +11.3%
- MCBT - Global Growth Fund (including all
transaction fees) +10.7%
- The Morgan Stanley Capital International World
Index +14.2%
[Graph]
(a) Performance for the benchmark is not available from June 15, 1994
(commencement of investment operations). For that reason, performance
is shown from July 1, 1994.
Performance shown is net of all fees after reimbursement from the Manager.
Returns and net asset values of fund investments will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their
original cost. The total returns would have been lower had certain expenses
not been waived during the period shown. Each performance figure including
all transaction fees assumes purchase at the beginning and redemption at the
end of the stated period and is calculated using an offering price which
reflects a transaction fee of 75 basis points on purchase and 75 basis points
on redemption. Transaction fees are paid to the Fund to cover trading costs.
Past performance is not indicative of future performance.
1
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
PROFILE AT APRIL 30, 1997
PORTFOLIO Led by the US, markets rose over the twelve months. We have
COMMENTS had an underweight position in US equities throughout the
period and have underperformed the MSCI World Index.
The US was powered by strong liquidity, despite a poor
outlook for earnings growth. Our stock selection in this
area has been good. Intel, for example, has risen by 126%
and the Royal Bank of Canada by 65.7% since we bought it in
July. Large stocks have risen most, having attracted a
disproportionately high amount of new money. We expect to
move down the capitalisation scale in our search for value.
Compounded by a weak currency, JAPAN has been a weak
market. Having had a currency hedge in place for much of
the year, we removed it in January. We reduced our
weighting in August and continued to sell stock until
February.
We have continued to add to our positions in
CONTINENTAL EUROPE. Local markets have been very strong,
although weaker currencies have reduced overall returns to a
US dollar investor. Restructuring and the enhancement of
shareholder value have been persistent themes and our
portfolio reflects this. We have been overweight to the UK,
where a strengthening currency and a stable economic
background have helped stockmarkets. The change in
government was very well received by financial markets.
In ASIA, we have been very selective as the region is
becoming less homogenous. Our preferred markets are Hong
Kong, Indonesia, the Philippines and India.
We increased our weighting in LATIN AMERICA at the end of
1996 and were rewarded by strong markets.
Outlook
We are confident that selected markets can
make good progress over the coming 12 months. Superior
growth in Latin America and Asia should feed through into
stock prices. In Continental Europe, the restructuring has
only just begun. We are more cautious on Japan at the
moment, as the economy has shown no signs of recovering.
INVESTMENT All members of the investment team report directly
MANAGER to Joe Scott Plummer (Chief Investment Officer), who has 27
PROFILE years investment experience. All funds are managed on a team
basis, with a named director heading each team.
Tony Hanlon has managed the MCBT Global Growth Fund
since inception.
He graduated from Glasgow University in 1984 with a
degree in Public Law and completed an MBA at Manchester
Business School in 1986. He then worked for Salomon
Brothers International in New York and London as an
institutional bond salesman. Tony joined Martin Currie in
1988, working in the North American team. He was appointed
an investment manager in 1991 and promoted to director in
1993. As head of the Strategy and Asset Control team, he
has responsibility for communicating and monitoring our
investment strategy.
2
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
PROFILE AT APRIL 30, 1997
ASSET ALLOCATION
(% of net assets)
40% Europe
12% Japan
6% Latin America
26% North America
2% Other Areas
11% Pacific Basin
3% Other Net Assets
[CHART]
LARGEST HOLDINGS
BY REGION/COUNTRY % OF NET ASSETS
EUROPE
Roche Holdings (Switzerland) 1.3
Novartis (Switzerland) 1.3
Internationale Nederlanden (Netherlands) 1.2
LATIN AMERICA
Telebras, ADR (Brazil) 1.0
NORTH AMERICA
Colgate - Palmolive (United States) 1.5
Union Pacific Resources (United States) 1.4
Bristol - Myers Squibb (United States) 1.4
JAPAN
Canon 1.0
Rohm 1.0
PACIFIC BASIN
Hutchison Whampoa (Hong Kong) 0.9
3
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
SHARE VALUE
----- -----
<S> <C> <C>
COMMON AND PREFERRED STOCKS AND EXCHANGEABLE NOTES - 97.5%
EUROPE - 39.8%
AUSTRIA - 0.6%
VA TECHNOLOGIE 2,100 $ 326,330
----------
TOTAL AUSTRIA - (COST $290,145) 326,330
----------
DENMARK - 0.7%
NOVO NORDISK, CL B 4,200 415,494
----------
TOTAL DENMARK - (COST $391,864) 415,494
----------
FRANCE - 5.6%
AIR LIQUIDE 3,340 503,017
AXA 9,209 566,599
ELF AQUITAINE 3,617 350,762
MICHELIN, CL B 8,800 491,678
RHONE-POULENC, CL A 14,000 470,864
SCHNEIDER 9,340 526,490
SEITA 7,300 259,906
----------
TOTAL FRANCE - (COST $2,818,610) 3,169,316
----------
GERMANY - 6.5%
DEUTSCHE BANK 11,600 612,218
DEUTSCHE TELEKOM 5,080 110,236
HOECHST 17,400 683,220
MANNESMANN 1,500 589,849
SGL CARBON 3,600 502,021
VEBA 10,856 559,161
VOLKSWAGEN 1,000 635,755
----------
TOTAL GERMANY - (COST $2,901,061) 3,692,460
----------
ITALY - 0.6%
ENI 70,619 358,421
----------
TOTAL ITALY - (COST $334,894) 358,421
----------
NETHERLANDS - 3.3%
ELSEVIER 36,400 582,908
INTERNATIONALE NEDERLANDEN 17,950 704,807
PHILIPS ELECTRONICS N.V. 11,000 574,193
----------
TOTAL NETHERLANDS - (COST $1,213,328) 1,861,908
----------
SPAIN - 2.4%
BANCO DE SANTANDER 8,700 654,560
CENTROS COMERCIALES CONTINENTE 13,818 233,442
TELEFONICA DE ESPANA 19,000 486,680
----------
TOTAL SPAIN - (COST $1,095,271) 1,374,682
----------
</TABLE>
See notes to financial statements.
4
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
SHARE VALUE
----- -----
<S> <C> <C>
EUROPE - CONTINUED
SWEDEN - 1.4%
ABB AB, SERIES A 47,000 $ 572,170
ERICSSON L.M., CL B 6,352 200,810
----------
TOTAL SWEDEN - (COST $700,337) 772,980
----------
SWITZERLAND - 3.7%
NOVARTIS 565 744,339
ROCHE HOLDINGS 90 760,125
ZURICH VERSICHER 1,850 607,421
----------
TOTAL SWITZERLAND - (COST $1,742,897) 2,111,885
----------
UNITED KINGDOM - 15.0%
BRITISH TELECOMMUNICATIONS 60,000 439,546
CABLE & WIRELESS 49,000 377,328
GENERAL ELECTRIC 42,000 249,359
GKN 28,000 431,572
GLAXO WELLCOME 30,000 589,789
GRANADA 29,000 418,785
LADBROKE 109,000 406,321
LASMO 89,017 321,731
LLOYDS TSB 63,000 574,862
MARKS & SPENCER 59,000 467,601
MCKECHNIE 22,000 176,143
NFC 131,000 300,430
RECKITT & COLMAN 40,250 547,974
ROYAL BANK OF SCOTLAND GROUP 52,000 490,502
SAFEWAY 53,496 296,526
SCOTTISH POWER 70,000 424,311
SHELL TRANSPORT & TRADING 27,000 477,423
SMITHS INDUSTRIES 31,314 382,670
UNILEVER 17,000 446,629
WASSALL 45,000 256,726
WOLSELEY 48,000 384,311
----------
TOTAL UNITED KINGDOM - (COST $6,839,971) 8,460,539
----------
TOTAL EUROPE - (COST $18,328,378) 22,544,015
----------
LATIN AMERICA - 6.4%
ARGENTINA - 0.7%
COMPANIA PEREZ COMPANC 25,536 207,117
TELEFONICA DE ARGENTINA, ADR 6,500 216,125
----------
TOTAL ARGENTINA - (COST $286,315) 423,242
----------
BRAZIL - 2.4%
COMPANIA VALE DO RIO DOCE, ADR 8,500 216,596
ELECTROBRAS, ADR 13,600 304,300
PETROBRAS, ADR 13,000 275,641
TELEBRAS, ADR 4,800 550,800
----------
TOTAL BRAZIL - (COST $822,340) 1,347,337
----------
</TABLE>
See notes to financial statements.
5
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
SHARE VALUE
----- -----
<S> <C> <C>
LATIN AMERICA - CONTINUED
CHILE - 0.6%
COMPANIA DE TELEFONOS DE CHILE, ADR 11,000 $ 356,125
----------
TOTAL CHILE - (COST $318,117) 356,125
----------
MEXICO - 1.9%
CEMEX, CL B 67,000 245,353
CIFRA SA DE CV, CL B 200,000 307,054
CORPORACION INDUSTRIAL ALFA, CL A 24,292 133,283
EMPRESAS ICA SOCIEDAD, ADR 7,200 107,100
GRUPO FINANCIERO BANAMEX, CL B 128,000 274,153
----------
TOTAL MEXICO - (COST $973,151) 1,066,943
----------
PERU - 0.2%
PERU REAL ESTATE, CL B 180,000 23,640
TELEFONICA DEL PERU, ADR, CL B 4,000 96,000
----------
TOTAL PERU - (COST $169,632) 119,640
----------
VENEZUELA - 0.6%
COMPANIA ANONIMA NACIONAL TELEFONOS, ADR, CL D * 11,000 330,000
----------
TOTAL VENEZUELA - (COST $253,000) 330,000
----------
TOTAL LATIN AMERICA - (COST $2,822,555) 3,643,287
----------
NORTH AMERICA - 26.4%
CANADA - 1.2%
ROYAL BANK OF CANADA 16,704 667,802
----------
TOTAL CANADA - (COST $411,226) 667,802
----------
UNITED STATES - 25.2%
ALLIED SIGNAL 9,750 704,437
ARCHER - DANIELS - MIDLAND 27,479 504,927
BRISTOL - MYERS SQUIBB 12,000 786,000
COLGATE - PALMOLIVE 7,600 843,600
DILLARD DEPARTMENT STORES, CL A 13,600 419,900
EASTMAN KODAK 8,300 693,050
FREEPORT MCMORAN COPPER & GOLD, CL A 23,136 647,808
FREEPORT MCMORAN, INC. 21,133 618,140
GENERAL ELECTRIC 5,600 620,900
INPHYNET MEDICAL MANAGEMENT * 8,200 188,600
INTEL 4,050 620,156
MARSH & MCLENNAN 6,100 735,050
MEDPARTNERS * 22,760 415,370
PHILIP MORRIS 18,450 726,469
SCHLUMBERGER 6,800 753,100
SEARS, ROEBUCK 9,500 456,000
TEXACO 6,000 633,000
TRANSOCEAN OFFSHORE 8,000 485,000
UNION PACIFIC 9,100 580,125
UNION PACIFIC RESOURCES 29,207 792,240
</TABLE>
See notes to financial statements.
6
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
SHARE VALUE
----- -----
<S> <C> <C>
NORTH AMERICA - CONTINUED
UNITED STATES - CONTINUED
WALT DISNEY 8,900 $ 729,800
WESTINGHOUSE ELECTRIC 38,000 646,000
WORLDCOM INC. * 27,700 664,800
----------
TOTAL UNITED STATES - (COST $10,250,941) 14,264,472
----------
TOTAL NORTH AMERICA - (COST $10,662,167) 14,932,274
----------
PACIFIC BASIN - 11.3%
AUSTRALIA - 1.5%
LEND LEASE CORPORATION 10,500 200,943
NATIONAL AUSTRALIA BANK LIMITED 20,000 273,727
NEWS CORPORATION 91,000 347,025
----------
TOTAL AUSTRALIA - (COST $854,205) 821,695
----------
HONG KONG - 6.3%
AMOY PROPERTIES 260,000 256,761
CHEUNG KONG HOLDINGS 53,000 465,243
CHINA LIGHT & POWER 47,000 211,747
CHINA OVERSEAS LAND & INVESTMENT 510,000 288,033
CITIC PACIFIC 40,000 216,356
FIRST PACIFIC COMPANY 150,000 179,113
HONG KONG TELECOMMUNICATIONS 152,800 262,343
HSBC HOLDINGS 19,054 482,100
HUTCHISON WHAMPOA 71,000 527,012
NEW WORLD DEVELOPMENT LIMITED 75,000 432,776
SWIRE PACIFIC 29,500 227,538
----------
TOTAL HONG KONG - (COST $3,155,683) 3,549,022
----------
INDONESIA - 0.7%
TELEKOMUNIKASI INDONESIA 280,000 406,173
----------
TOTAL INDONESIA - (COST $436,171) 406,173
----------
MALAYSIA - 1.5%
AMMB HOLDINGS 47,000 312,609
EDARAN OTOMOBILE NASIONAL 30,000 283,177
UNITED ENGINEERS 39,000 276,486
----------
TOTAL MALAYSIA - (COST $772,546) 872,272
----------
PHILIPPINES - 0.6%
PHILIPPINE LONG DISTANCE TELEPHONE, ADR 5,800 323,350
----------
TOTAL PHILIPPINES - (COST $349,373) 323,350
----------
SINGAPORE - 0.7%
DEVELOPMENT BANK OF SINGAPORE 35,000 415,889
----------
TOTAL SINGAPORE - (COST $373,691) 415,889
----------
TOTAL PACIFIC BASIN - (COST $5,941,669) 6,388,401
----------
</TABLE>
See notes to financial statements.
7
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
SHARE VALUE
----- -----
<S> <C> <C>
OTHER AREAS - 1.6%
INDIA - 1.6%
HIMALAYAN FUND 29,031 $ 400,628
SCHRODER INDIA FUND * 18,000 197,703
VIDESH SANCHAR NIGAM LIMITED, GDR (A) * 16,000 313,600
----------
TOTAL INDIA - (COST $941,407) 911,931
----------
TOTAL OTHER AREAS - (COST $941,407) 911,931
----------
JAPAN - 12.0%
ASAHI DIAMOND 309 2,425
CANON 23,000 545,397
DDI 51 338,701
EIDEN SAKAKIYA 10,000 80,356
HITACHI 41,000 371,450
ITO - YOKADO 7,000 335,841
KAMIGUMI 34,000 168,212
KYOCERA 3,000 179,619
MABUCHI MOTOR 3,000 151,968
MARUI 14,000 230,512
MBL INT'L. FINANCE (BERMUDA), EXCH. GTD NOTES, 3.00%, 11/30/2002 (B) 120,000 122,100
MITSUBISHI HEAVY INDUSTRIES 52,000 343,294
MITSUI FUDOSAN 24,000 274,156
NIPPON EXPRESS 29,000 199,905
NITTO DENKO 11,000 159,452
NOMURA SECURITIES 15,000 167,802
RISO KAGAKU 2,000 118,171
ROHM 7,000 542,640
SECOM COMPANY LIMITED 4,000 237,917
SHIMACHU 6,000 144,168
SHIN - ETSU CHEMICAL 15,850 319,660
SONY 7,000 509,552
SUMITOMO ELECTRIC 26,000 352,306
TAISHO PHARMACEUTICAL 8,000 197,897
TOKIO MARINE & FIRE 16,000 156,300
TOYOTA MOTOR CORPORATION 18,000 521,842
----------
TOTAL JAPAN - (COST $7,231,155) 6,771,643
----------
TOTAL COMMON AND PREFFERED STOCKS AND
EXCHANGEABLE NOTES - (COST $45,927,331) + 55,191,551
----------
PRINCIPAL
AMOUNT
------
SHORT TERM INVESTMENT - 2.0%
STATE STREET BANK AND TRUST REPURCHASE AGREEMENT, 5.15%, 5/01/1997 (C) $ 1,144,000 1,144,000
----------
TOTAL SHORT TERM INVESTMENT - (COST $1,144,000) 1,144,000
----------
</TABLE>
See notes to financial statements
8
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1997
<TABLE>
<CAPTION>
VALUE
-----
<S> <C>
TOTAL INVESTMENTS - (COST $47,071,331) - 99.5% $ 56,335,551
CASH, RECEIVABLES AND OTHER ASSETS, LESS LIABILITIES - 0.5% 298,914
-------------
NET ASSETS - 100.0% $ 56,634,465
-------------
-------------
</TABLE>
* Non-income producing security.
(a) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $313,600 or 0.6% of net
assets.
(b) Reflected at par value and denominated in U.S. dollars.
(c) The repurchase agreement, dated 4/30/97, $1,144,000 par due 5/01/97, is
collateralized by United States Treasury Notes, 5.875%, due 1/31/99, with a
market value of $1,168,055.
+ Percentages of long term investments are presented in the portfolio by
country. Percentages of long term investments by industry are as follows:
Aerospace 1.9%, Automobiles 2.5%, Banks 9.3%, Chemicals 4.4%, Conglomerates
3.1%, Construction & Building Materials 1.1%, Construction & Mining
Equipment 0.2%, Diversified 0.3%, Drugs & Health Care 5.9%, Electric
Utilities 2.7%, Electrical Equipment 4.2%, Electronics 5.2%, Engineering
1.1%, Financial Services 1.2%, Food & Beverages 1.8%, Hotels & Restaurants
0.7%, Household Products 3.3%, Industrial Machinery 2.7%, Insurance 3.9%,
Investment Companies 1.1%, Leisure Time 2.0%, Mining 2.6%, Oil & Gas 5.1%,
Petroleum Services 1.7%, Photography 2.2%, Publishing 1.6%, Railroads &
Equipment 3.4%, Real Estate 3.5%, Retail Trade 5.3%, Telecommunications
2.4%, Telecommunications Services 2.8%, Telephone 4.5%, Tires & Rubber
0.9%, Tobacco 1.7%, Transportation 1.2%.
ADR American Depositary Receipts.
GDR Global Depositary Receipts.
See notes to financial statements.
9
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1997
<TABLE>
<S> <C>
ASSETS
Investments in securities, at value (cost $45,927,331) (Note B) $ 55,191,551
Investments in repurchase agreements, at value (Note B) 1,144,000
-------------
Total Investments 56,335,551
Cash 627
Foreign currency, at value (cost $27,125) (Note B) 27,095
Receivable for investments sold 174,082
Dividend and interest receivable 169,723
Foreign tax reclaims receivable 28,077
Prepaid insurance expense 4,743
Deferred organization expenses (Note B) 5,408
-------------
TOTAL ASSETS 56,745,306
-------------
LIABILITIES
Management fee payable (Note C) 78,808
Administration fee payable (Note C) 4,576
Trustees fees payable (Note C) 1,163
Accrued expenses and other liabilities 26,294
-------------
TOTAL LIABILITIES 110,841
-------------
TOTAL NET ASSETS $ 56,634,465
-------------
-------------
COMPOSITION OF NET ASSETS:
Paid-in-capital $ 46,827,646
Undistributed net investment income 153,352
Accumulated net realized gain on investment and foreign
currency transactions 393,209
Net unrealized appreciation on investment and foreign currency
transactions 9,260,258
-------------
TOTAL NET ASSETS $ 56,634,465
-------------
-------------
NET ASSET VALUE PER SHARE $ 12.47
($56,634,465 / 4,540,616 shares of beneficial interest outstanding) -------------
-------------
</TABLE>
See notes to financial statements.
10
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
YEAR ENDED APRIL 30, 1997
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest income $ 43,182
Dividend income 1,053,384
Foreign taxes withheld (87,026)
-----------
TOTAL INVESTMENT INCOME 1,009,540
-----------
EXPENSES
Management fee (Note C) 375,240
Custodian fee 113,878
Administration fee (Note C) 55,043
Audit fee 24,113
Legal fees 2,825
Transfer agent fee 6,586
Trustees fees (Note C) 2,074
Amortization of deferred organization expenses 2,548
Miscellaneous expenses 10,887
Fees and expenses waived by the investment manager (Note C) (55,729)
-----------
TOTAL EXPENSES 537,465
-----------
NET INVESTMENT INCOME 472,075
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCY
Net realized gain on investments 1,072,718
Net realized gain on foreign currency transactions 475,540
Net increase in unrealized appreciation on:
Investments (net of foreign taxes of ($6,829)) 2,574,635
Foreign currency transactions 95,815
-----------
NET GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 4,218,708
-----------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 4,690,783
-----------
-----------
</TABLE>
See notes to financial statements.
11
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR YEAR
ENDED ENDED
APRIL 30, 1997 APRIL 30, 1996
-------------- --------------
<S> <C> <C>
NET ASSETS at beginning of period $ 52,887,926 $ 37,259,376
------------ ------------
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income 472,075 563,980
Net realized gain on investment transactions 1,072,718 553,937
Net realized gain on foreign currency transactions 475,540 1,129,132
Net unrealized appreciation (depreciation) on:
Investments 2,574,635 5,906,618
Foreign currency transactions 95,815 (220,811)
------------ ------------
Net increase in net assets from operations 4,690,783 7,932,856
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income (1,000,298) (692,764)
In excess of net investment income (404,226) (63,581)
Net realized gains (645,365) 0
------------ ------------
Total distributions (2,049,889) (756,345)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares 0 7,940,000
Reinvestment of dividends and distributions to shareholders 1,355,645 452,039
Cost of shares repurchased (251,875) 0
Paid in capital from subscription and redemption fees 1,875 60,000
------------ ------------
Total increase in net assets from capital share transactions 1,105,645 8,452,039
------------ ------------
NET INCREASE IN NET ASSETS 3,746,539 15,628,550
------------ ------------
NET ASSETS at end of period (includes undistributed net investment $ 56,634,465 $ 52,887,926
income of $153,352 and $528,223, respectively) ------------ ------------
------------ ------------
OTHER INFORMATION:
CAPITAL SHARE TRANSACTIONS:
Shares sold 0 679,794
Shares issued in reinvestment of distributions to shareholders 111,576 41,548
Less shares repurchased (20,511) 0
------------ ------------
Net share transactions 91,065 721,342
------------ ------------
------------ ------------
</TABLE>
See notes to financial statements.
12
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING FOR THE PERIOD
<TABLE>
<CAPTION>
YEAR YEAR JUNE 15, 1994*
ENDED ENDED THROUGH
APRIL 30, 1997 APRIL 30, 1996 APRIL 30, 1995
-------------- -------------- --------------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period $ 11.890 $ 9.990 $ 10.000
Net investment income 0.141 0.279 0.079
Net realized and unrealized gain on investment
and foreign currency transactions 0.902 1.809 0.033
------------ ------------ ------------
Total from investment operations 1.043 2.088 0.112
------------ ------------ ------------
Less distributions:
Net investment income (0.226) (0.186) (0.040)
In excess of net investment income (0.091) (0.017) 0.000
Net realized gains (0.146) 0.000 (0.082)
------------ ------------ ------------
Total distributions (0.463) (0.203) (0.122)
------------ ------------ ------------
Paid in capital from subscription and redemption fees (Note B) 0.000 0.015 0.000
------------ ------------ ------------
Net asset value, end of period $ 12.470 $ 11.890 $ 9.990
------------ ------------ ------------
------------ ------------ ------------
TOTAL INVESTMENT RETURN (1) 8.87% 21.17% 1.18%(2)
------------ ------------ ------------
------------ ------------ ------------
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 56,634,465 $ 52,887,926 $ 37,259,376
Operating expenses, net, to average net assets (Note C) 1.00% 1.00% 1.00%(3)
Operating expenses, gross, to average net assets (Note C) 1.10% 1.27% 1.25%(3)
Net investment income to average net assets 0.88% 1.40% 0.94%(3)
Portfolio turnover rate 40% 38% 44%
Average commission rate per share (4) $ 0.0227 $ 0.0335 N/A
Per share amount of fees waived (Note C) $ 0.017 $ 0.053 $ 0.022
</TABLE>
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* Commencement of investment operations.
(1) Total return at net asset value assuming all distributions reinvested and
no purchase premiums or redemption fees. Total return would have been lower
had certain expenses not been waived.
(2) Periods less than one year are not annualized.
(3) Annualized.
(4) The average commission rate paid is applicable for Funds that invest
greater than 10% of average net assets in equity transactions on which
commissions are charged. This disclosure is required for fiscal periods
beginning on or after September 1, 1995.
See notes to financial statements.
13
<PAGE>
MCBT GLOBAL GROWTH FUND
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NOTES TO FINANCIAL STATEMENTS
NOTE A - ORGANIZATION
Martin Currie Business Trust ("MCBT") (the "Trust") is registered under the
Investment Company Act of 1940, as amended (the 1940 Act), as an open-end
management investment company organized as a Massachusetts business trust on May
20, 1994. The Trust offers six funds which have differing investment objectives
and policies: Global Growth Fund, Opportunistic EAFE Fund, Global Emerging
Markets Fund, Japan Small Companies Fund, Emerging Americas Fund and Emerging
Asia Fund, (the "Funds"). The MCBT Global Growth Fund (the "Fund") commenced
investment operations on June 15, 1994. The Fund's Declaration of Trust permits
the Board of Trustees to issue an unlimited number of full and fractional shares
of beneficial interest, without par value.
NOTE B - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.
VALUATION OF INVESTMENTS - The Fund's portfolio securities traded on a
securities exchange are valued at the last quoted sale price, or, if no sale
occurs, at the mean of the most recent quoted bid and asked prices. Unlisted
securities for which market quotations are readily available are valued at the
mean of the most recent quoted bid and asked prices. Prices for securities
which are primarily traded in foreign markets are furnished by quotation
services expressed in the local currency's value and are translated into U.S.
dollars at the current rate of exchange. Short-term securities and debt
securities with a remaining maturity of 60 days or less are valued at their
amortized cost. Options and futures contracts are valued at the last sale price
on the market where such options or futures contract is principally traded.
Options traded over-the-counter are valued based upon prices provided by market
makers in such securities or dealers in such currencies. Securities for which
current market quotations are unavailable or for which quotations are not deemed
by the investment adviser to be representative of market values are valued at
fair value as determined in good faith by the Trustees of the Fund, or by
persons acting pursuant to procedures established by the Trustees.
REPURCHASE AGREEMENTS - In connection with transactions in repurchase
agreements, the Fund's custodian takes possession of the underlying collateral
securities, the value or market price of which is at least equal to the
principal amount, including interest, of the repurchase transaction. To the
extent that any repurchase transaction exceeds one business day, the value of
the collateral is marked-to-market on a daily basis to ensure the adequacy of
the collateral. In the event of default of the obligation to repurchase, the
Fund has the right to liquidate the collateral and apply the proceeds in
satisfaction of the obligation. Under certain circumstances, 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.
INVESTMENT TRANSACTIONS - Investment security transactions are recorded on the
date of purchase or sale. Realized gains and losses from security transactions
are determined on the basis of identified cost.
INVESTMENT INCOME - Dividend income is recorded on the ex-dividend date.
Interest income is accrued as earned. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
FOREIGN CURRENCY TRANSLATIONS - The records of the Fund are maintained in U.S.
dollars. Foreign currency amounts are translated into U.S. dollars at a current
rate of exchange of such currency to determine the value of investments, other
assets and liabilities on the date of any determination of net asset value of
the Fund. Purchases and sales of securities and income and expenses are
converted at the prevailing rate of exchange on the respective dates of such
transactions.
The Fund may realize currency gains or losses between the trade and settlement
dates on security transactions. To minimize such currency gains or losses, the
Fund may enter into forward foreign currency contracts.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund on each day and the resulting net unrealized
appreciation, depreciation and related net receivable or payable amounts are
determined by using forward currency exchange rates supplied by a quotation
service.
14
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
FOREIGN CURRENCY TRANSLATIONS (CONTINUED) - Reported net realized gains and
losses on foreign currency transactions represent net gains and losses from
sales and maturities of forward currency contracts, disposition of foreign
currencies, currency gains and losses realized between the trade and settlement
dates on security transactions, and the difference between the amount of net
investment income accrued and the U.S. dollar amount actually received. The
effects of changes in foreign currency exchange rates on investments in
securities are not segregated in the Statement of Operations from the effects of
changes in market prices of those securities, and are included with the net
realized and unrealized gain or loss on investment securities.
FORWARD FOREIGN CURRENCY CONTRACTS - A forward foreign currency contract
("Forward") is an agreement between two parties to buy and sell a currency at a
set price on a future date. The market value of the Forward fluctuates with
changes in currency exchange rates. The Forward is marked-to-market daily and
the change in the market value is recorded by the Fund as an unrealized gain or
loss. When the Forward is closed, the Fund records a realized gain or loss
equal to the difference between the value at the time it was opened and the
value at the time it was closed. The Fund could be exposed to risk if a
counterparty is unable to meet the terms of the contract or if the value of the
currency changes unfavorably. The Fund may enter into Forwards in connection
with planned purchases and sales of securities, to hedge specific receivables or
payables against changes in future exchange rates or to hedge the U.S. dollar
value of portfolio securities denominated in a foreign currency.
EXPENSES - Expenses directly attributable to the Fund are charged to the Fund.
Expenses not directly attributable to a Fund are either split evenly among the
affected Funds, allocated on the basis of relative average net assets, or
otherwise allocated among the Funds as the Board of Trustees may direct or
approve. Certain costs incurred in connection with the organization of the
Trust and each Fund have been deferred and are being amortized on a straight
line basis over a five year period starting on each Fund's commencement of
operations.
DISTRIBUTIONS TO SHAREHOLDERS - The Fund declares and distributes dividends from
net investment income, if any, and distributes its net realized capital gains,
if any, at least annually. All distributions will be reinvested in shares of
the Fund at the net asset value unless the shareholder elects in the
subscription agreement to receive cash. Income 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 passive foreign investment companies (PFIC's),
foreign currency transactions, losses deferred due to wash sales, post October
31 losses and excise tax regulations. Permanent book and tax differences
relating to shareholder distributions will result in reclassifications to paid-
in-capital. Distributions are recorded on the ex-dividend date.
PURCHASES AND REDEMPTIONS OF FUND SHARES - There is a purchase premium for cash
investments into the Fund of 0.75% of the amount invested and a redemption fee
on cash redemptions of 0.75% of the amount redeemed. All purchase premiums and
redemption fees are paid to and retained by the Fund and are recorded as paid-
in-capital by the Fund. These fees are intended to offset brokerage and
transaction costs arising in connection with the purchase and redemption. The
purchase and redemption fees may be waived by the Manager, however, if these
brokerage and transaction costs are minimal or in other circumstances at the
Manager's discretion. For the year ended April 30, 1997, $1,875 was collected
in redemption fees.
INCOME TAXES - Each Fund of the Trust is treated as a separate entity for U.S.
federal income tax purposes. Each Fund intends to qualify each year as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended. By so qualifying, the Funds will not be subject to federal
income taxes to the extent that they distribute substantially all of their
taxable income, including realized capital gains, for the fiscal year. In
addition, by distributing substantially all of their net investment income,
capital gains and certain other amounts, if any, during the calendar year, the
Funds will not be subject to a federal excise tax. On December 30, 1996 the
Fund declared a long term capital gain distribution of $645,365, representing
$0.146 per share.
The Fund may be subject to taxes imposed by countries in which it invests. Such
taxes are generally based on income and/or capital gains earned or repatriated.
Taxes are accrued and applied to net investment income, net realized gains and
unrealized appreciation as such income and/or gains are earned.
15
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
INCOME TAXES (CONTINUED) - The Fund intends to make an election under Internal
Revenue Code Section 853 to pass through foreign taxes paid by the Fund to its
shareholders. During the year ended April 30, 1997 the total amount of foreign
taxes that will be passed through to the shareholders and the foreign source
income for information reporting purposes will be $87,026 and $814,664,
respectively.
ESTIMATES - 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
income and expenses at the date of the financial statements. Actual results
could differ from these estimates.
NOTE C - AGREEMENTS AND FEES
The Fund has entered into a Management Contract with Martin Currie Inc. (the
"Investment Manager"), a wholly owned subsidiary of Martin Currie Ltd. Under
the Management Contract, the Fund pays the Investment Manager a quarterly
management fee at the annual rate of 0.70% of the Fund's average net assets.
The Investment Manager has voluntarily undertaken to reduce its fee until
further notice to the extent necessary to limit the Fund's annual expenses
(including the management fee but excluding brokerage commissions, transfer
taxes, and extraordinary expenses) to 1.00% of the Fund's average net assets on
an annualized basis. For the year ended April 30, 1997, the Investment Manager
has waived $55,729 of its fees.
State Street Bank and Trust Company (the "Administrator") serves as
administrator of the Fund. The Administrator performs certain administrative
services for the Fund. The Fund pays the Administrator a fee at the rate of
0.08% of the Fund's average net assets up to $125 million, 0.06% of the next
$125 million, and 0.04% of those assets in excess of $250 million, subject to
certain minimum requirements, plus certain out of pocket costs. State Street
Bank and Trust Company also receives fees and compensation of expenses for
certain custodian and transfer agent services.
Trustees of the Trust who are not interested persons receive aggregate annual
fees of $20,000.
NOTE D - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
short-term securities for the year ended April 30, 1997 were $21,460,825 and
$22,173,466, respectively.
The identified cost of investments in securities and repurchase agreements owned
for federal income tax purposes and their respective gross unrealized
appreciation and depreciation at April 30, 1997 were as follows:
IDENTIFIED GROSS UNREALIZED NET UNREALIZED
COST APPRECIATION (DEPRECIATION) APPRECIATION
------------ ------------ -------------- ------------
$ 47,317,682 $ 11,308,304 $ (2,290,435) $ 9,017,869
NOTE E - PRINCIPAL SHAREHOLDERS
As of April 30, 1997, 100% of the Fund's outstanding shares were held by two
shareholders, each holding in excess of 10% of the Fund's outstanding shares.
16
<PAGE>
MCBT GLOBAL GROWTH FUND
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE F - CONCENTRATION OF RISK
The Fund will invest extensively in foreign securities (i.e., those which are
not listed on a United States securities exchange). Investing in foreign
securities involves risks not typically found in investing in U.S. markets.
These include risks of adverse change in foreign economic, political, regulatory
and other conditions, and changes in currency exchange rates, exchange control
regulations (including currency blockage), expropriation of assets or
nationalization, imposition of withholding taxes on dividend or interest
payments and capital gains, and possible difficulty in obtaining and enforcing
judgments against foreign entities. Furthermore, issuers of foreign securities
are subject to different, and often less comprehensive, accounting, reporting
and disclosure requirements than domestic issuers. The securities of some
foreign companies and foreign securities markets are less liquid and at times
more volatile than securities of comparable U.S. companies and U.S. securities
markets.
17
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of the
Martin Currie Business Trust - Global Growth Fund
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Global Growth Fund (the "Fund")
at April 30, 1997, and 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. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at April 30, 1997 by
correspondence with the custodian, provide a reasonable basis for the opinion
expressed above.
Price Waterhouse LLP
Boston, Massachusetts
June 17, 1997
18
<PAGE>
MARTIN CURRIE BUSINESS TRUST
____________________
TRUSTEES AND OFFICERS
C. James P. Dawnay, TRUSTEE AND PRESIDENT *
Simon D. Eccles, TRUSTEE
Patrick R. Wilmerding, TRUSTEE
W. Stewart Coghill, VICE PRESIDENT AND TREASURER
J. Grant Wilson, VICE PRESIDENT
Julian M.C. Livingston, CLERK
* INTERESTED TRUSTEE
____________________
INVESTMENT MANAGER
Martin Currie, Inc.
Saltire Court
20 Castle Terrace
Edinburgh EH1 2ES
Scotland
011-44-131-229-5252
Regulated by IMRO
Registered Investment Adviser with the SEC
____________________
The information contained in this report is intended for general
informational purposes only. This report is not authorized for distribution
to prospective investors unless preceded or accompanied by a current Private
Placement Memorandum which contains important information concerning the Fund
and its current offering of shares.
