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Alliance
Municipal
Trust
- Connecticut Portfolio
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AllianceCapital [LOGO](R)
Semi-Annual Report
December 31, 1998
(unaudited)
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<PAGE>
STATEMENT OF NET ASSETS
December 31, 1998 (unaudited) Alliance Municipal Trust - Connecticut Portfolio
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Principal
Amount
(000) Security(a) Yield Value
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MUNICIPAL BONDS-84.4%
ALABAMA-48%
Birmingham Finance
Authority
(Carraway Methodist
Health System)
Series '98A VRDN
$ 4,300 8/15/28 (b)............. 4.00% $ 4,300,000
Birmingham Special
Care Finance Authority
Facilities
(Eye Foundation Hospital)
Series '98A VRDN
3,000 9/01/18 (b)............. 3.85 3,000,000
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7,300,000
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ARKANSAS-1.3%
Blytheville IDR
(Nucor Corp. Project)
Series '98 AMT VRDN
2,000 6/01/28 (b)............. 4.20 2,000,000
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COLORADO-0.1%
Colorado Student
Obligation Authority
(Student Loan Revenue)
Series '90A AMT VRDN
200 9/01/24 (b)............. 3.95 200,000
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CONNECTICUT-53.2%
Connecticut Development
Authority
(Exeter Energy Project)
Series '89B AMT VRDN
3,700 12/01/19 (b)............ 4.70 3,700,000
Connecticut Development
Authority
(Independent Living)
Series '90 VRDN
6,390 7/01/15 (b)............. 3.90 6,390,000
Connecticut Development
Authority
(Rand Whitney Project)
Series '93 AMT VRDN
7,500 8/01/23 (b)............. 3.60 7,500,000
Connecticut Development
Authority
Res. Rec. (Exeter Energy
Project) Series '89C
AMT VRDN
3,500 12/01/19 (b)............ 4.70 3,500,000
Connecticut Development
Authority IDR
(Northeast Foods, Inc.)
Series '98 AMT VRDN
5,500 6/01/13 (b)............. 4.20 5,500,000
Connecticut Development
Authority PCR
(Central Vermont Public
Service)
Series '85 VRDN
1,000 12/01/15 (b)............ 3.15 1,000,000
Connecticut Development
Authority PCR
(Connecticut Light and
Power Co.)
Series '96A AMBAC
AMT VRDN
5,900 5/01/31 (b)............. 3.80 5,900,000
Connecticut GO
Series '89 Pre-refunded
1,000 3/01/99 ................ 3.80 1,008,954
Connecticut GO
Series '95A
1,500 3/15/99 ................ 3.28 1,505,824
Connecticut HEFA
(Bradley Health Care)
Series '97B VRDN
5,600 7/01/29 (b)............. 3.50 5,600,000
Connecticut HEFA
(Charlotte Hungerford
Hospital)
Series '98C VRDN
1,500 7/01/13 (b)............. 3.60 1,500,000
Connecticut HEFA
(Jerome Home Project)
Series '97C VRDN
3,730 7/01/29 (b)............. 3.50 3,730,000
Connecticut HEFA
(Pomfret School Issue)
Series '95A VRDN
1,000 7/01/24 (b)............. 4.00 1,000,000
Connecticut HEFA
(St. Raphel Hospital)
Series '98J VRDN
2,000 7/01/22 (b)............. 3.90 2,000,000
Connecticut HEFA
(St. Raphel Hospital)
Series '98K VRDN
1,000 7/01/22 (b)............. 3.90 1,000,000
1
<PAGE>
STATEMENT OF NET ASSETS (continued)
Alliance Municipal Trust - Connecticut Portfolio
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Principal
Amount
(000) Security(a) Yield Value
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Connecticut HEFA
(Yale University)
Series '97T-1 VRDN
$ 5,800 7/01/29 (b)............. 3.70% $ 5,800,000
Connecticut Special
Assessment Unemployment
Compensation
Series '93C FGIC PPB
5,000 11/15/01 (b)............ 3.60 5,000,000
Connecticut Special Tax
Obligation
(2nd Lien Transportation
Infrastructure)
Series '90-1 VRDN
12,300 12/01/10 (b)............ 4.10 12,300,000
Connecticut Special Tax
Obligation
(Transport Infrastructure)
Series '89 Pre-refunded
1,000 7/01/99 ................ 3.69 1,033,235
Connecticut Special Tax
Obligation
(Transport Infrastructure)
Series A Pre-refunded
1,950 2/01/99 ................ 3.25 1,995,243
Connecticut Special Tax
Obligation
(Transportation
Infrastructure)
Series C
1,000 12/01/99 ............... 3.00 1,032,192
Stafford GO BAN
Series '98
960 8/04/99 ................ 3.73 960,323
Stamford GO
Series '85
1,000 12/15/99 ............... 3.00 1,039,625
Thomaston GO
Series '98 FSA
800 9/15/99 ................ 3.38 812,739
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80,808,135
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DELAWARE-4.6%
Delaware Economic
Development Authority IDR
(Delaware Clean Power
Project) Series '97A
AMT VRDN
4,500 8/01/29 (b)............. 4.20 4,500,000
Delaware Economic
Development Authority IDR
(Delmarva Power & Light)
Series '88 AMT VRDN
2,400 10/01/17 (b)............ 4.95 2,400,000
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6,900,000
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GEORGIA-1.6%
Municipal Electric
Authority of Georgia
Series '85C VRDN
2,400 3/01/20 (b)............. 4.15 2,400,000
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ILLINOIS-0.7%
St. Charles IDA
(Pier 1 Imports -
Midwest Project)
AMT VRDN
1,000 12/15/26 (b)............ 4.15 1,000,000
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LOUISIANA-3.3%
Calcasieu Parish IDR
(Citgo Petroleum Corp.)
Series '96 AMT VRDN
2,000 7/01/26 (b)............. 5.25 2,000,000
West Baton Rouge IDA
(Dow Chemical Co.)
Series '95 AMT VRDN
3,000 11/01/25 (b)............ 5.30 3,000,000
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5,000,000
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PENNSYLVANIA-2.6%
Montgomery County
(Pennsylvania Higher
Education & Health Loan)
Series '96A VRDN
4,000 8/01/21 (b)............. 4.10 4,000,000
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SOUTH CAROLINA-2.8%
Berkeley County IDA
(Nucor Corp. Project)
Series '95 AMT VRDN
1,900 9/01/28 (b)............. 4.20 1,900,000
Berkeley County IDR
(Nucor Corp. Project)
Series '97 AMT VRDN
2,300 4/01/30 (b)............. 4.20 2,300,000
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4,200,000
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TENNESSEE-3.3%
Volunteer State Student Loan
(Student Funding Corp.)
Series '87A-3 AMT VRDN
5,000 12/01/17 (b)............ 4.50 5,000,000
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2
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Alliance Municipal Trust - Connecticut Portfolio
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Principal
Amount
(000) Security(a) Yield Value
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TEXAS-2.2%
Brazos River
(Dow Chemical Harbor
Navigation District Project)
Series '98 AMT VRDN
$ 3,400 3/01/28 (b)............. 5.30% $ 3,400,000
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VIRGINIA-2.6%
Peninsula Ports Authority IDR
(Ziegler Coal Project)
Series '97 AMT VRDN
3,900 5/01/22 (b)............. 5.20 3,900,000
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WASHINGTON-1.3%
Port of Port Angeles IDR
(Daishowa America Project)
Series '91 AMT VRDN
2,000 6/01/06 (b)............. 4.10 2,000,000
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Total Municipal Bonds
(amortized cost
$128,108,135)........... 128,108,135
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COMMERCIAL PAPER-15.5%
CONNECTICUT-15.5%
Connecticut HEFA
(Yale University) Series P
5,000 3/10/99 ................ 2.75 5,000,000
Connecticut HEFA
(Yale University) Series P
3,500 3/01/99 ................ 3.15 3,500,000
Connecticut Special
Assessment Injury Fund
Series '97
6,000 1/28/99 ................ 2.90 6,000,000
Connecticut Special
Assessment Injury Fund
Series '97
4,000 2/18/99 ................ 2.95 4,000,000
Connecticut Special
Assessment Injury Fund
Series '97
3,000 2/25/99 ................ 2.95 3,000,000
Connecticut Special
Assessment Injury Fund
Series '97
2,000 2/01/99 ................ 3.05 2,000,000
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Total Commercial Paper
(amortized cost
$23,500,000)............ 23,500,000
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TOTAL INVESTMENTS-99.9%
(amortized cost
$151,608,135)........... 151,608,135
Other assets less
liabilities-0.1%........ 180,444
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NET ASSETS-100%
(offering and redemption
price of $1.00 per share;
151,818,171 shares
outstanding)............ $ 151,788,579
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(a) All securities either mature or their interest rate changes in one year or
less.
(b) Variable Rate Demand Notes (VRDN) are instruments whose interest rates
change on a specified date (such as coupon date or interest payment date) or
whose interest rates vary with changes in a designated base rate (such as
the prime interest rate). These instruments are payable on demand and are
secured by letters of credit or other credit support agreements from major
banks. Periodic Put Bonds (PPB) are payable on demand quarterly,
semi-annually or annually and their interest rates change less frequently
than rates on Variable Rate Demand Notes.
Glossary of Terms:
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
BAN Bond Anticipation Note
FSA Financial Security Assurance
FGIC Financial Guaranty Insurance Company
GO General Obligation
HEFA Health & Educational Facility Authority
IDA Industrial Development Authority
IDR Industrial Development Revenue
PCR Pollution Control Revenue
See notes to financial statements.
3
<PAGE>
STATEMENT OF OPERATIONS
Six Months Ended December 31, 1998 (unaudited)
Alliance Municipal Trust - Connecticut Portfolio
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<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest............................................................. $ 2,503,818
EXPENSES
Advisory fee (Note B)................................................ $ 373,674
Distribution assistance and administrative service (Note C).......... 319,221
Custodian fees....................................................... 37,828
Transfer agency (Note B)............................................. 28,326
Registration fees.................................................... 8,977
Audit and legal fees................................................. 5,809
Printing............................................................. 5,352
Trustees' fees....................................................... 1,197
Miscellaneous........................................................ 1,263
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Total expenses....................................................... 781,647
Less: expense reimbursement.......................................... (34,300)
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Net expenses......................................................... 747,347
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NET INCREASE IN NET ASSETS FROM OPERATIONS.............................. $ 1,756,471
==============
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
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<TABLE>
<CAPTION>
Six Months Ended
December 31, 1998 Year Ended
(unaudited) June 30, 1998
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<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income................................................ $ 1,756,471 $ 3,174,536
Net change in unrealized appreciation of investments................. -0- (932)
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Net increase in net assets from operations........................... 1,756,471 3,173,604
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income................................................ (1,756,471) (3,174,536)
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase (Note E)................................................ 27,681,613 21,495,926
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Total increase....................................................... 27,681,613 21,494,994
NET ASSETS
Beginning of year.................................................... 124,106,966 102,611,972
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End of period........................................................ $ 151,788,579 $ 124,106,966
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</TABLE>
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See notes to financial statements.
4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
December 31, 1998 (unaudited) Alliance Municipal Trust - Connecticut Portfolio
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NOTE A: Significant Accounting Policies
Alliance Municipal Trust (the "Fund") is registered under the Investment Company
Act of 1940 as an open-end investment company. The Fund operates as a series
company currently consisting of: Alliance Municipal Trust-General Portfolio,
Alliance Municipal Trust-New York Portfolio, Alliance Municipal Trust-California
Portfolio, Alliance Municipal Trust-Connecticut Portfolio (the "Portfolio"),
Alliance Municipal Trust-New Jersey Portfolio, Alliance Muncipal Trust-Virginia
Portfolio, Alliance Municipal Trust-Florida Portfolio and Alliance Municipal
Trust-Massachusetts Portfolio. Each series is considered to be a separate entity
for financial reporting and tax purposes. The Portfolio pursues its objectives
by maintaining a portfolio of high-quality money market securities all of which,
at the time of investment, have remaining maturities of 397 days or less. The
financial statements have been prepared in conformity with generally accepted
accounting principles which require management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities in the
financial statements and amounts of income and expenses during the reporting
period. Actual results could differ from those estimates. The following is a
summary of significant accounting policies followed by the Portfolio.
1. Valuation of Securities
Securities in which the Portfolio invests are traded primarily in the
over-the-counter market and are valued at amortized cost, under which method a
portfolio instrument is valued at cost and any premium or discount is amortized
on a constant basis to maturity. Amortization of premium is charged to income.
Accretion of market discount is credited to unrealized gains.
2. Taxes
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Dividends
The Portfolio declares dividends daily from net investment income and
automatically reinvests such dividends in additional shares at net asset value.
Net realized capital gains on investments, if any, are expected to be
distributed near year end. Dividends paid from net investment income for the six
months ended December 31, 1998, are exempt from federal income taxes. However,
certain shareholders may be subject to the alternative minimum tax.
4. Investment Income and Investment Transactions
Interest income is accrued as earned. Investment transactions are recorded on a
trade date basis. Realized gain (loss) from investment transactions is recorded
on the identified cost basis.
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NOTE B: Advisory Fee and Transactions with an Affiliate of the Adviser
The Portfolio pays its Adviser, Alliance Capital Management L.P., an advisory
fee at the annual rate of .50% on the first $1.25 billion of average daily net
assets; .49% on the next $.25 billion; .48% on the next $.25 billion; .47% on
the next $.25 billion; .46% on the next $1 billion; and .45% in excess of $3
billion. The Adviser has agreed, pursuant to the advisory agreement, to
reimburse the Portfolio to the extent that its annual aggregate expenses
(excluding taxes, brokerage, interest and, where permitted, extraordinary
expenses) exceed 1% of its average daily net assets for any fiscal year. For the
six months ended December 31, 1998, the reimbursement amounted to $34,300.
The Portfolio compensates Alliance Fund Services, Inc., a wholly-owned
subsidiary of the Adviser, under a Transfer Agency Agreement for providing
personnel and facilities to perform transfer agency services for the Portfolio.
Such compensation amounted to $18,392 for the six months ended December 31,
1998.
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NOTE C: Distribution Assistance and Administrative Services Plan
Under this Plan, the Portfolio pays Alliance Fund Distributors, Inc., (the
"Distributor"), a wholly-owned subsidiary of the Adviser, a distribution fee at
the annual rate of up to .25% of the average daily value of the Port-
5
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NOTES TO FINANCIAL STATEMENTS
(continued) Alliance Municipal Trust - Connecticut Portfolio
================================================================================
folio's net assets. The Plan provides that the Distributor will use such
payments in their entirety for distribution assistance and promotional
activities. For the six months ended December 31, 1998, the distribution fee
amounted to $186,837. In addition, the Portfolio may reimburse certain
broker-dealers for administrative costs incurred in connection with providing
shareholder services, and may reimburse the Adviser for accounting and
bookkeeping, and legal and compliance support. For the six months ended December
31, 1998, such payments by the Portfolio amounted to $132,384, of which $46,000
was paid to the Adviser.
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NOTE D: Investment Transactions
At December 31, 1998, the cost of investments for federal income tax purposes
was the same as the cost for financial reporting purposes. At June 30, 1998, the
Portfolio had a capital loss carryforward of $29,592, of which $10,717 expires
in 2000, $16,849 expires in 2002 and $2,026 expires in the year 2004.
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NOTE E: Transactions in Shares of Beneficial Interest
An unlimited number of shares ($.01 par value) are authorized. At December 31,
1998, capital paid-in aggregated $151,818,171. Transactions, all at $1.00 per
share, were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1998 June 30,
(unaudited) 1998
---------------- ----------------
<S> <C> <C>
Shares sold............................................................. 268,472,137 433,663,681
Shares issued on reinvestments of dividends............................. 1,756,471 3,174,536
Shares redeemed......................................................... (242,546,995) (415,342,291)
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Net increase ........................................................... 27,681,613 21,495,926
============ ============
</TABLE>
6
<PAGE>
FINANCIAL HIGHLIGHTS Alliance Municipal Trust - Connecticut Portfolio
================================================================================
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Six Months
Ended
December 31, Year Ended June 30,
1998 ------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year ......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------ ------
Income From Investment Operations
Net investment income (a) .................. .012 .027 .027 .028 .028 .017
------ ------ ------ ------ ------ ------
Less: Dividends
Dividends from net investment income ....... (.012) (.027) (.027) (.028) (.028) (.017)
------ ------ ------ ------ ------ ------
Net asset value, end of period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ====== ======
Total Return
Total investment return based on net
asset value (b) ......................... 2.36%(c) 2.75% 2.76% 2.88% 2.78% 1.71%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) .. $151,789 $124,107 $102,612 $95,812 $75,991 $57,314
Ratios to average net assets of:
Expenses, net of waivers and
reimbursements ........................ 1.00%(c) .93% .80% .80% .80% .77%
Expenses, before waivers and
reimbursements ........................ 1.05%(c) 1.06% 1.10% 1.15% 1.21% 1.21%
Net investment income (a) ............... 2.35%(c) 2.69% 2.72% 2.84% 2.77% 1.69%
</TABLE>
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(a) Net of expenses reimbursed or waived by the Adviser.
(b) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
(c) Annualized.
7
<PAGE>
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BULK RATE
Alliance Municipal Trust - Connecticut Portfolio U.S. POSTAGE
1345 Avenue of the Americas, New York, NY 10105 PAID
Toll free 1 (800) 221-5672 New York, NY
Permit No. 7131
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Yields. For current recorded yield information on Alliance Municipal Trust,
call on a touch-tone telephone toll-free (800) 251-0539 and press the following
sequence of keys:
|1| |#| |1| |#| |2| |8| |#|
For non-touch-tone telephones, call toll-free (800) 221-9513
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AllianceCapital [LOGO](R)
Distribution of this report other than to shareholders must be preceded or
accompanied by the Fund's current prospectus, which contains further information
about the Fund.
(R) These registered service marks used under license from the owner, Alliance
Capital Management L.P.
ACTSR
