<PAGE>
[LOGO] PIONEER
Pioneer
Small Company
Fund
SEMIANNUAL REPORT 4/30/98
<PAGE>
Table of Contents
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Letter from the Chairman 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 6
Schedule of Investments 9
Financial Statements 16
Notes to Financial Statements 22
Report of Independent Public Accountants 27
Trustees, Officers and Service Providers 28
The Pioneer Family of Mutual Funds 29
</TABLE>
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
LETTER FROM THE CHAIRMAN 4/30/98
- --------------------------------------------------------------------------------
Dear Shareowner,
- --------------------------------------------------------------------------------
I am pleased to introduce this semiannual report for Pioneer Small Company
Fund, covering the six months ended April 30, 1998. On behalf of your
investment team, I thank you for your interest and this opportunity to comment
on today's investing environment.
The United States' economic news continued to be positive, propelling the
domestic stock market to yet another series of record highs. Large-
capitalization stocks were the big winners with the Dow Jones Industrial
Average returning over 22% as concerns about the Asian financial crisis drew
investors toward the safety of U.S. "blue chip" companies.
Recently, many of the smaller sized, value-oriented stocks of the type found in
your Fund have not performed as well as larger well-known growth stocks, but
history tells us that markets are cyclical. While it is impossible to predict
the direction of the markets with any degree of certainty, the fact remains
that large company stocks' record-breaking pace has pushed that group's average
price-to-earnings ratio to an all-time high. The rest of the market, on the
other hand, is trading at lower levels. It would not be surprising to see a new
trend emerge, with smaller-capitalization issues taking leadership positions as
investors search for more reasonable valuations.
We believe that using a solid value approach to choosing stocks -
purchasing them at reasonable prices and holding them until we think they reach
full value - will help provide the best opportunity for positive long-term
results. Investors who maintain a diversified portfolio and a long-term
perspective have the potential to weather any short-term risks the market may
pose.
I encourage you to read on to learn more about Pioneer Small Company Fund. If
you have questions, please contact your investment professional, or Pioneer at
1-800-225-6292.
Respectfully,
/S/ John F. Cogan, Jr.
John F. Cogan, Jr.,
Chairman and President
1
<PAGE>
Pioneer Small Company Fund
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PORTFOLIO SUMMARY 4/30/98
- --------------------------------------------------------------------------------
P o r t f o l i o D i v e r s i f i c a t i o n
- --------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[PIE CHART]
<TABLE>
<S> <C>
U.S. Common Stocks 85%
Short-Term Cash Equivalents 10%
International Common Stock 5%
</TABLE>
S e c t o r D i s t r i b u t i o n
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
[PIE CHART]
<TABLE>
<S> <C>
Consumer Cyclicals 29%
Consumer Staples 21%
Capital Goods 14%
Technology 13%
Basic Materials 11%
Energy 4%
Financial 3%
Healthcare 3%
Transportation 2%
</TABLE>
1 0 L a r g e s t H o l d i n g s
- --------------------------------------------------------------------------------
(As a percentage of equity holdings)
<TABLE>
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
1. Jan Bell Marketing, Inc. 2.85% 6. Morrison Knudsen Corp. 2.43%
- --------------------------------------------------------------------------------
2. Anacomp, Inc. 2.60 7. Uniroyal Technology Corp. 2.38
- --------------------------------------------------------------------------------
3. Phar-Mor, Inc. 2.53 8. Micro Warehouse, Inc. 1.90
- --------------------------------------------------------------------------------
4. First Brands Corp. 2.52 9. Magellan Health 1.89
Services, Inc.
- --------------------------------------------------------------------------------
5. John H. Harland Co. 2.52 10. Pittston Burlington Group 1.85
- --------------------------------------------------------------------------------
</TABLE>
Fund holdings will vary for other periods.
2
<PAGE>
Pioneer Small Company Fund
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PERFORMANCE UPDATE 4/30/98 CLASS A SHARES
- --------------------------------------------------------------------------------
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 4/30/98 10/31/97
$14.42 $15.31
Distributions per Share Income Short-Term Long-Term
(10/31/97 - 4/30/98) Dividends Capital Gains Capital Gains
- $1.325 $0.508
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Small Company Fund at public offering price, compared to the growth
of the Russell 2000 Index.
Average Annual Total Returns
(As of April 30, 1998)
<TABLE>
<CAPTION>
Net Asset Public Offering
Period Value Price*
<S> <C> <C>
Life-of-Fund 25.93% 22.98%
(11/2/95)
1 Year 36.35 28.49
</TABLE>
* Reflects deduction of the maximum
5.75% sales charge at the beginning
of the period and assumes reinvest-
ment of distributions at net asset
value.
[MOUNTAIN CHART]
Growth of $10,000+
{PLOT POINTS]
Pioneer
Small Russell
Company 2000
Fund* Index
11/30/95 9425 10000
01/31/96 9860 10253
04/30/96 11383 11364
07/31/96 10908 10338
10/31/96 11338 11190
01/31/97 12600 12196
04/30/97 11638 11370
07/31/97 13966 13790
10/31/97 14726 14473
01/31/98 13921 14400
04/30/98 15868 16192
+ Index comparison begins 11/30/95. The Russell 2000 Index is an unmanaged
measure of the 2,000 smallest stocks, based on capitalization, in the Russell
3000 Index. Stocks in the Index trade on the New York Stock Exchange, American
Stock Exchange and NASDAQ. Index returns are calculated monthly, assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
charges or expenses. You cannot invest directly in the Index.
Past performance does not guarantee future results. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
3
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 4/30/98 CLASS B SHARES
- --------------------------------------------------------------------------------
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 4/30/98 10/31/97
$14.14 $15.10
Distributions per Share Income Short-Term Long-Term
(10/31/97 - 4/30/98) Dividends Capital Gains Capital Gains
- $1.325 $0.508
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Small Company Fund, compared to the growth of the Russell 2000
Index.
Average Annual Total Returns
(As of April 30, 1998)
<TABLE>
<CAPTION>
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 25.05% 24.18%
(11/2/95)
1 Year 35.32 31.32
</TABLE>
* Reflects deduction of the maximum
applicable contingent deferred sales
charge (CDSC) at the end of the period
and assumes reinvestment of
distributions. The maximum CDSC
of 4% declines over six years.
[MOUNTAIN CHART]
Growth of $10,000+
[PLOT POINTS]
Pioneer
Small Russell
Company 2000
Fund* Index
11/30/95 10000 10000
01/31/96 10442 10253
04/30/96 12026 11364
07/31/96 11504 10338
10/31/96 11941 11190
01/31/97 13238 12196
04/30/97 12209 11370
07/31/97 14624 13790
10/31/97 15389 14473
01/31/98 14524 14400
04/30/98 16222 16192
+ Index comparison begins 11/30/95. The Russell 2000 Index is an unmanaged
measure of the 2,000 smallest stocks, based on capitalization, in the Russell
3000 Index. Stocks in the Index trade on the New York Stock Exchange, American
Stock Exchange and NASDAQ. Index returns are calculated monthly, assume
reinvestment of dividends and, unlike Fund returns, do not reflect any fees,
charges or expenses. You cannot invest directly in the Index.
Past performance does not guarantee future results. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
4
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
PERFORMANCE UPDATE 4/30/98 CLASS C SHARES
- --------------------------------------------------------------------------------
S h a r e P r i c e s a n d D i s t r i b u t i o n s
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C>
Net Asset Value
per Share 4/30/98 10/31/97
$14.15 $15.11
Distributions per Share Income Short-Term Long-Term
(10/31/97 - 4/30/98) Dividends Capital Gains Capital Gains
- $1.325 $0.508
</TABLE>
I n v e s t m e n t R e t u r n s
- --------------------------------------------------------------------------------
The mountain chart on the right shows the growth of a $10,000 investment made
in Pioneer Small Company Fund, compared to the growth of the
Russell 2000 Index.
Average Annual Total Returns
(As of April 30, 1998)
<TABLE>
<CAPTION>
If If
Period Held Redeemed*
<S> <C> <C>
Life-of-Fund 22.65% 22.65%
(1/31/96)
1 Year 35.40 35.40
</TABLE>
* Assumes reinvestment of
distributions. The 1% contingent
deferred sales charge (CDSC)
applies to redemptions made
within one year of purchase.
[MOUNTAIN CHART]
Growth of $10,000
[PLOT POINTS]
Pioneer
Small Russell
Company 2000
Fund* Index
01/31/96 10000 10000
04/30/96 11526 11084
07/31/96 11026 10083
10/31/96 11435 10915
01/31/97 12687 11895
04/30/97 11692 11090
07/31/97 14005 13450
10/31/97 14747 14116
01/31/98 13918 14045
04/30/98 15832 15793
The Russell 2000 Index is an unmanaged measure of the 2,000 smallest stocks,
based on capitalization, in the Russell 3000 Index. Stocks in the Index trade
on the New York Stock Exchange, American Stock Exchange and NASDAQ. Index
returns are calculated monthly, assume reinvestment of dividends and, unlike
Fund returns, do not reflect any fees, charges or expenses. You cannot invest
directly in the Index.
Past performance does not guarantee future results. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than their
original cost.
5
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 4/30/98
- --------------------------------------------------------------------------------
Dear Shareowner,
- --------------------------------------------------------------------------------
As Pioneer Small Company Fund began its new fiscal year last November, economic
and currency crises in Asia dominated the financial news. This sparked a
"flight to quality," with investors rushing to the most familiar and liquid
securities they could find, paying record-high prices for a relatively small
number of large-capitalization U.S. stocks while mostly ignoring
small-capitalization stocks.
Reflecting this trend, over the past six months, the Dow Jones Industrial
Average and Standard & Poor's 500 Index returned 22.84% and 22.46%,
respectively, while the Russell 2000 Index posted an 11.87% total return. The
580 small cap funds tracked by Lipper Analytical Services returned an average
of 11.07%. For the first half of its fiscal year, your Fund's Class A Shares
posted a total return of 7.76%, Class B Shares 7.36% and Class C Shares 7.36%,
all at net asset value.
Two factors seem to stand out when assessing why your Fund underperformed.
First, the market capitalization of the Fund's portfolio holdings is smaller,
on average, than those in the Lipper small cap universe; this made it an even
more difficult period since most of the market appreciation was in larger
stocks. In addition, the Fund owned significantly fewer financial stocks - a
sector that turned in outstanding performance due to a number of recent mergers
and acquisitions - compared to its peers. Although we continually monitor this
group, the vast majority did not meet our strict value criteria.
Fully Invested, "Aggressive Value" Strategy
While it is impossible to predict which stocks investors will prefer -
especially why and when their choices will shift - we do rely on certain
disciplines. We search for stocks that fit our "aggressive value" investment
style - out-of-favor companies selling at relatively low prices, but with
strong cash flow, significant market share, solid balance sheets and skilled
management. We tend to be drawn toward companies whose
6
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
senior management have a significant ownership interest in the businesses they
lead. Typically, we evaluate a company by assessing what we would pay if we
were buying the entire business. This technique allows us to set well-defined
buy and sell prices for all of the stocks that we review and place in the
portfolio.
We analyze stocks for the portfolio one at a time - looking "bottom up" at
their individual merits. This process often leads us to companies that Wall
Street does not follow. As of April 30, the portfolio contained 115 stocks
representing 55 industries.
Patience and Discipline
Our patience is beginning to pay off with respect to some of these holdings.
One in particular is Jan Bell Marketing, a stock in the portfolio for almost
two years. This jewelry marketer has a favorable price-to-book ratio and a
highly regarded management team. It is starting to catch investors' attention
and has recently traded over $5.50 a share, well above the Fund's average cost
basis but below our target price.
We continued to add shares of Anacomp, the market leader in microfiche
services, when its stock price dipped. The nature of its business may sound
somewhat dull in today's technological age but we are impressed with its
margins and the way its management operates the business.
Our style often leads us to buy stocks when they are at their most depressed
levels. Patience is necessary as we wait for other investors to recognize the
potential we already see. An example is CML Group, the parent company of
NordicTrak and Smith & Hawken. In December, we added to the Fund's position in
the stock after its price fell. It has since hired a new CEO and we are
confident that a significant turnaround can occur, even though its stock price
has remained sluggish. This same approach frequently directs us to companies
that are prime takeover candidates. The Fund benefited from acquisitions in
April when Dataflex and NAI Technologies were purchased by CompuCom Systems and
DRS Technologies, respectively.
7
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 4/30/98 (continued)
- --------------------------------------------------------------------------------
Things began to improve for your Fund in January. The Fund posted gains as
several stocks began to move toward our price targets. We started to take gains
in several, including Bally Total Fitness Holding, the fitness center operator,
Zapata, a food processor and American Annuity Group, a financial company.
Retail drug store stocks, as a group, also fared well during the period. We
were pleased with the performance of both Phar-Mor and Drug Emporium. Of
course, there are always companies that fail to meet our expectations. John H.
Harland, the check printing company, had a sharp price drop early in the period
after the company's board removed its CEO, but we continue to believe in its
long-term prospects.
Looking Ahead
Going forward, we believe it will be difficult for the large-cap companies that
have led the market to sustain their record-setting growth. If earnings
disappointments begin to appear, investors are likely to start looking for
alternatives among smaller companies. We think the Fund has exposure to a
number of exciting companies, and we are confident of their long-term outlook.
Our emphasis on aggressive value means that we are typically buying stocks that
we believe are near their "lows," which should even afford the Fund some
protection in a down market.
We continue to believe that well-valued, small stocks offer some of the most
attractive equity investments available today. This group has the potential to
generate some significant returns, in exchange for taking some risk, and we
look forward to both the opportunities and the challenges that lie ahead. On
behalf of the entire small company team, thank you for your support.
Respectfully,
/s/ Todd E. Grady
Todd E. Grady,
Portfolio Manager
8
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 4/30/98
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
COMMON STOCKS - 90.1%
Basic Materials - 9.8%
Agricultural Products - 0.4%
110,000 Alico, Inc. $ 2,316,875
-----------
Chemicals (Specialty) - 2.2%
387,000 Specialty Chemical Resources, Inc.*+ $ 387,000
1,237,500 Uniroyal Technology Corp.*+ 11,756,250
-----------
$12,143,250
-----------
Containers & Packaging (Paper) - 1.6%
335,200 BWay Corp.* $ 8,819,950
-----------
Paper & Forest Products - 1.2%
760,200 Crown Vantage, Inc.*+ $ 6,556,725
-----------
Iron & Steel - 1.0%
505,600 Kentucky Electric Steel, Inc.*+ $ 2,970,400
102,500 Schnitzer Steel Industries, Inc. 2,716,250
-----------
$ 5,686,650
-----------
Metals & Mining - 1.3%
454,900 Inco, Ltd. (VBN Shares) $ 5,438,512
801,500 Uranium Resources, Inc.*+ 1,803,375
-----------
$ 7,241,887
-----------
Gold & Precious Metals Mining - 2.1%
516,000 Cambior Inc. $ 4,063,500
190,000 Getchell Gold Corp.* 4,678,750
635,000 TVX Gold Inc.* 2,579,688
-----------
$11,321,938
-----------
Total Basic Materials $54,087,275
-----------
Capital Goods - 12.5%
Aerospace/Defense - 0.0%
27,500 First Aviation Services, Inc.* $ 165,000
-----------
Engineering & Construction - 4.1%
100,000 Level 3 Communications, Inc.* $ 6,200,000
1,008,600 Morrison Knudsen Corp.* 12,040,162
434,556 Salient 3 Communications Inc.+ 4,508,518
-----------
$22,748,680
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 9
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 4/30/98 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Electrical Equipment - 2.0%
500,500 Acme Electric Corp.*+ $ 2,909,156
75,000 Hadco Corp.* 2,868,750
252,100 MagneTek, Inc.* 4,963,219
-----------
$10,741,125
-----------
Machinery (Diversified) - 0.2%
193,200 Interlake Corp.* $ 893,550
-----------
Metal Fabricators - 0.4%
145,447 Keystone Consolidated Industries, Inc.* $ 1,718,094
61,000 Russel Metals, Inc.* 238,823
-----------
$ 1,956,917
-----------
Manufacturing (Specialized) - 1.3%
396,200 The York Group, Inc. $ 7,230,650
-----------
Office Equipment & Supplies - 4.3%
780,620 Anacomp, Inc.*+ $12,880,230
182,700 Nam Tai Electronics, Inc. 2,900,363
524,500 Nashua Corp.*+ 8,064,187
-----------
$23,844,780
-----------
Waste Management - 0.2%
126,900 Philip Services Corp.* $ 959,681
-----------
Total Capital Goods $68,540,383
-----------
Consumer Cyclicals - 25.9%
Consumer (Jewelry, Novelties & Gifts) - 3.7%
2,534,600 Jan Bell Marketing, Inc.*+ $14,098,712
188,700 Stanhome, Inc. 6,321,450
-----------
$20,420,162
-----------
Retail (Discounters) - 0.1%
100,000 Hills Stores Co.* $ 400,000
-----------
Leisure Time (Products) - 0.5%
164,700 Johnson Worldwide Associates, Inc.* $ 2,552,850
-----------
Auto Parts & Equipment - 0.5%
211,700 Sparton Motors, Inc.* $ 1,600,981
115,000 TBC Corp.* 1,020,625
-----------
$ 2,621,606
-----------
</TABLE>
10 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Publishing - 0.6%
574,500 INTERLINQ Software Corp.*+ $ 3,267,469
-----------
Retail (Specialty-Apparel) - 2.7%
510,000 Catherines Stores Corp.*+ $ 5,227,500
524,000 Charming Shoppes, Inc.* 2,439,875
1,898,000 CML Group, Inc.* 3,558,750
801,500 Dylex Ltd.* 3,194,008
60,115 Harold's Stores, Inc.* 465,891
-----------
$14,886,024
-----------
Retail (Computers & Electronics) - 1.3%
1,090,000 InterTAN, Inc.*+ $ 7,357,500
-----------
Retail (Specialty) - 4.4%
100,000 Bally Total Fitness Holding Corp.* $ 3,075,000
587,500 Cross-Continent Auto Retailers, Inc.* 4,883,594
791,200 Jenny Craig Inc.* 4,302,150
576,500 Lechters, Inc.* 3,765,266
464,700 United Auto Group* 8,422,687
-----------
$24,448,697
-----------
Services (Commercial & Consumer) - 1.0%
242,100 Angelica Corp. $ 5,326,200
-----------
Retail (Home Shopping) - 3.4%
175,900 Blair Corp. $ 4,859,237
367,500 Creative Computers, Inc.* 3,123,750
602,500 Micro Warehouse, Inc.* 9,414,062
857,000 National Media Corp.* 1,285,500
-----------
$18,682,549
-----------
Textiles (Home Furnishings) - 1.2%
885,800 EKCO Group, Inc.* $ 6,477,412
20,000 Polymer Group, Inc.* 245,000
423,000 River Oaks Furniture, Inc.*+ 0
-----------
$ 6,722,412
-----------
Textiles (Specialty) - 0.6%
287,000 Cone Mills Corp.* $ 2,600,937
153,000 Johnston Industries, Inc. 870,188
-----------
$ 3,471,125
-----------
</TABLE>
The accompanying notes are an integral part of these financial statements. 11
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 4/30/98 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Textiles (Apparel) - 5.9%
300,000 Brown Group Inc. $ 4,781,250
498,000 Chic by H.I.S., Inc.+ 4,170,750
890,000 Donnkenny, Inc.*+ 3,448,750
312,000 The Leslie Fay Company, Inc.*+ 4,914,000
646,500 Marisa Christina, Inc.*+ 2,484,984
326,000 Norton McNaughton, Inc.* 2,078,250
45,500 O'Sullivan Industries Holdings, Inc.* 688,188
481,800 The Stride Rite Corp. 6,052,613
1,066,500 Tultex Corp.* 3,599,438
------------
$ 32,218,223
------------
Total Consumer Cyclicals $142,374,817
------------
Consumer Staples - 19.3%
Beverages (Non-Alcoholic) - 0.2%
129,500 Pepsi-Cola Puerto Rico Bottling Co. (Class B)* $ 930,781
------------
Foods - 4.6%
500,000 Chiquita Brands International, Inc. $ 6,812,500
484,700 Maple Leaf Foods, Inc. 6,692,645
854,186 WLR Foods, Inc.+ 5,552,209
500,000 Zapata Corp. 6,375,000
------------
$ 25,432,354
------------
Household Products (Non-Durables) - 3.2%
465,200 First Brands Corp. $ 12,473,175
58,800 National Presto Industries,Inc 2,337,300
519,600 Royal Appliance Manufacturing Co.* 2,857,800
------------
$ 17,668,275
------------
Personal Care - 0.5%
215,000 Perrigo Co.* $ 2,781,563
------------
Specialty Printing - 2.3%
700,000 John H. Harland Co. $ 12,468,750
------------
Restaurants - 2.8%
10,000 Advantica Restaurant Group, Inc.* $ 91,250
657,600 Chart House Enterprises, Inc.*+ 5,877,300
600 Cooker Restaurant Corp. 7,050
405,500 Darden Restaurants 6,488,000
</TABLE>
12 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Restaurants - (continued)
398,100 Uno Restaurant Corp.* $ 2,960,869
------------
$ 15,424,469
------------
Retail Stores (Drug Stores) - 2.7%
600,100 Drug Emporium, Inc.* $ 2,512,919
1,119,200 Phar-Mor, Inc.*+ 12,521,050
------------
$ 15,033,969
------------
Retail Stores (Food Chains) - 1.5%
546,500 Buttrey Food & Drug Stores Co.*+ $ 8,334,125
------------
Services (Employment) - 1.1%
787,800 Transmedia Network Inc.+ $ 5,810,025
------------
Services (Facilities & Environment) - 0.4%
175,500 Dames & Moore Group $ 2,248,594
------------
Total Consumer Staples $106,132,905
------------
Energy - 3.5%
Oil & Gas (Exploration/Production) - 3.5%
1,915,000 Abacan Resource Corp.* $ 2,453,594
2,815,000 Arakis Energy Corp.* 4,926,250
110,000 EEX Corp.* 1,065,625
102,300 Forest Oil Corp.* 1,598,438
137,300 Louis Dreyfus Natural Gas Corp.* 2,754,581
297,500 Plains Resources Inc.* 6,173,125
------------
Total Energy $ 18,971,613
------------
Financial - 2.7%
Insurance (Life/Health) - 1.2%
270,700 American Annuity Group, Inc. $ 6,378,369
------------
Insurance (Property/Casualty) - 0.4%
40,000 Financial Security Assurance Holdings Ltd. $ 2,395,000
------------
Investment Management - 1.1%
665,800 Phoenix Duff & Phelps Corp. $ 5,867,363
------------
Total Financial $ 14,640,732
------------
Healthcare - 3.1%
Healthcare (Hospital Management) - 1.7%
337,300 Magellan Health Services, Inc.* $ 9,360,075
------------
</TABLE>
The accompanying notes are an integral part of these financial statements. 13
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 4/30/98 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Healthcare (Specialized Services) - 1.4%
393,000 Apria Healthcare Group, Inc.* $ 3,758,063
520,500 Cohr, Inc.*+ 4,066,406
-----------
$ 7,824,469
-----------
Total Healthcare $17,184,544
-----------
Technology - 11.6%
Electronics (Component Distributors) - 0.8%
35,500 Espey Manufacturing & Electronics Corp. $ 532,500
631,700 Signal Technology Corp.*+ 3,790,200
-----------
$ 4,322,700
-----------
Communications Equipment - 1.8%
140,000 Glenayre Technologies, Inc.* $ 2,196,250
849,500 PictureTel Corp.* 7,857,875
-----------
$10,054,125
-----------
Services (Data Processing) - 2.4%
774,900 Broadway & Seymour, Inc.*+ $ 5,424,300
363,500 Dataflex Corp.*+ 1,431,281
490,700 National Processing, Inc.* 6,164,419
-----------
$13,020,000
-----------
Electronics (Defense) - 0.4%
850,000 NAI Technologies, Inc.*+ $ 2,443,750
-----------
Equipment (Semiconductor) - 1.0%
150,000 BMC Industries, Inc. $ 2,737,500
401,000 Ferrofluidics Corp.*#+ 2,005,000
20,000 Lam Research Corp.* 620,000
-----------
$ 5,362,500
-----------
Computers (Networking) - 0.0%
75,000 Apertus Technologies, Inc.* $ 72,656
-----------
Computers (Peripherals) - 2.5%
873,000 Boca Research, Inc.*+ $ 3,846,656
710,000 In Focus Systems, Inc.* 6,123,750
624,000 Meridian Data, Inc.*+ 3,627,000
-----------
$13,597,406
-----------
</TABLE>
14 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------ -----
<S> <C> <C>
Electronics (Semiconductors) - 0.3%
295,000 Information Storage Devices, Inc.* $ 1,622,500
------------
Computers (Software & Services) - 2.4%
255,700 The Learning Company, Inc.* $ 7,319,413
100,000 Progress Software Corp.* 3,200,000
718,000 Work Group Technology Corp.*+ 2,827,125
------------
$ 13,346,538
------------
Total Technology $ 63,842,175
------------
Transportation - 1.7%
Air Freight - 1.7%
489,500 Pittston Burlington Group $ 9,178,125
------------
Total Transportation $ 9,178,125
------------
TOTAL COMMON STOCKS
(Cost $445,114,617) $494,952,569
------------
Principal
Amount TEMPORARY CASH INVESTMENTS - 9.9%
Commercial Paper - 9.9%
$11,000,000 American Express Co., 5.51%, 5/6/98 $ 11,000,000
9,744,000 Commercial Credit Corp., 5.51%, 5/1/98 9,744,000
9,756,000 G.E. Capital Corp., 5.53%, 5/5/98 9,756,000
12,545,000 Household Finance Corp., 5.53%, 5/4/98 12,545,000
11,152,000 Texaco, Inc., 5.51%, 5/7/98 11,152,000
------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $54,197,000) $ 54,197,000
------------
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $499,311,617) (a) $549,149,569
============
</TABLE>
* Non-income producing security.
+ Investments held by the Fund representing 5% or more of the outstanding
voting stock of such company.
# 40,000 shares of Ferrofluidics Corp. were restricted as of April 30, 1998.
(a) At April 30, 1998, the net unrealized gain on investments based on cost for
federal income tax purposes of $499,338,371 was as follows:
<TABLE>
<S> <C>
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $103,429,456
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (53,618,258)
------------
Net unrealized gain $ 49,811,198
============
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for
the six months ended April 30, 1998, aggregated $138,205,040 and $181,911,972,
respectively.
The accompanying notes are an integral part of these financial statements. 15
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
BALANCE SHEET 4/30/98
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investment in securities, at value (including temporary cash
investments of $54,197,000) (cost $499,311,617) $549,149,569
Cash 208,157
Receivables -
Investment securities sold 3,428,484
Fund shares sold 625,869
Dividends and interest 74,338
Organizational costs - net 24,718
Other 3,191
------------
Total assets $553,514,326
------------
LIABILITIES:
Payables -
Investment securities purchased $ 8,463,496
Fund shares repurchased 2,362,804
Due to affiliates 743,905
Accrued expenses 108,517
------------
Total liabilities $ 11,678,722
------------
NET ASSETS:
Paid-in capital $439,523,563
Accumulated net investment loss (2,195,415)
Accumulated undistributed net realized gain on investments 54,669,504
Net unrealized gain on investments 49,837,952
------------
Total net assets $541,835,604
============
NET ASSET VALUE PER SHARE:
(Unlimited number of shares authorized)
Class A (based on $248,110,416/17,206,117 shares) $ 14.42
============
Class B (based on $273,859,561/19,363,639 shares) $ 14.14
============
Class C (based on $19,865,627/1,403,832 shares) $ 14.15
============
MAXIMUM OFFERING PRICE:
Class A $ 15.30
============
</TABLE>
16 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Six Months Ended 4/30/98
<TABLE>
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Dividends (net of foreign taxes withheld of $7,695) $1,286,980
Interest 1,049,818
----------
Total investment income $ 2,336,798
-----------
EXPENSES:
Management fees $2,174,562
Transfer agent fees
Class A 296,871
Class B 242,003
Class C 17,523
Distribution fees
Class A 276,549
Class B 1,284,337
Class C 89,302
Accounting 44,345
Custodian fees 42,115
Registration fees 7,417
Professional fees 40,717
Printing 8,526
Organizational costs 4,856
Fees and expenses of nonaffiliated trustees 11,776
Miscellaneous 19,088
----------
Total expenses $ 4,559,987
Less fees paid indirectly (27,774)
-----------
Net expenses $ 4,532,213
-----------
Net investment loss $(2,195,415)
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments $54,665,299
Change in net unrealized gain on investments (14,506,701)
-----------
Net gain on investments $40,158,598
-----------
Net increase in net assets resulting from operations $37,963,183
===========
</TABLE>
The accompanying notes are an integral part of these financial statements. 17
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Six Months Ended 4/30/98 and the Year Ended 10/31/97
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
4/30/98 10/31/97
------------ ------------
<S> <C> <C>
FROM OPERATIONS:
Net investment loss $ (2,195,415) $ (5,584,672)
Net realized gain on investments 54,665,299 69,812,627
Change in net unrealized gain or loss on investments (14,506,701) 65,111,218
------------ ------------
Net increase in net assets resulting from operations $ 37,963,183 $129,339,173
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gain:
Class A ($1.83 and $0.91 per share, respectively) $(29,848,737) $(15,757,933)
Class B ($1.83 and $0.91 per share, respectively) (32,228,495) (15,659,376)
Class C ($1.83 and $0.91 per share, respectively) (2,149,245) (1,198,552)
------------ ------------
Total distributions to shareholders $(64,226,477) $(32,615,861)
------------ ------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 44,418,343 $ 81,888,958
Reinvestment of distributions 55,328,291 28,220,336
Cost of shares repurchased (69,239,713) (124,997,871)
------------ ------------
Net increase (decrease) in net assets resulting from
fund share transactions $ 30,506,921 $(14,888,577)
------------ ------------
Net increase in net assets $ 4,243,627 $ 81,834,735
NET ASSETS:
Beginning of period 537,591,977 455,757,242
------------ ------------
End of period (including accumulated net investment
loss of $2,195,415 and $0, respectively) $541,835,604 $537,591,977
------------ ------------
</TABLE>
<TABLE>
<CAPTION>
CLASS A '98 Shares '98 Amount '97 Shares '97 Amount
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Share sold 1,418,267 $ 19,100,671 4,220,016 $ 55,164,381
Reinvestment of distributions 2,150,568 27,355,224 1,162,079 14,305,198
Less shares repurchased (2,835,374) (38,331,563) (6,412,012) (86,801,534)
---------- ------------ ---------- ------------
Net increase (decrease) 733,461 $ 8,124,332 (1,029,917) $(17,331,955)
========== ============ ========== ============
CLASS B
Shares sold 1,601,368 $ 20,767,988 1,871,189 $ 24,706,488
Reinvestment of distributions 2,107,745 26,367,893 1,067,469 13,044,471
Less shares repurchased (2,060,770) (27,425,864) (2,489,326) (33,236,413)
---------- ------------ ---------- ------------
Net increase 1,648,343 $ 19,710,017 449,332 $ 4,514,546
========== ============ ========== ============
CLASS C
Shares sold 347,179 $ 4,549,684 152,724 $ 2,018,089
Reinvestment of distributions 128,209 1,605,174 71,249 870,667
Less shares repurchased (258,167) (3,482,286) (372,397) (4,959,924)
---------- ------------ ---------- ------------
Net increase (decrease) 217,221 $ 2,672,572 (148,424) $ (2,071,168)
========== ============ ========== ============
</TABLE>
18 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 4/30/98
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months 11/2/95
Ended Year Ended to
4/30/98 10/31/97 10/31/96
---------- ---------- ---------
<S> <C> <C> <C>
CLASS A
Net asset value, beginning of period $ 15.31 $ 12.66 $ 10.00
------- -------- --------
Increase (decrease) from investment
operations:
Net investment income (loss) $ (0.04) $ (0.11) $ 0.05
Net realized and unrealized gain on
investments 0.98 3.67 2.63
------- -------- --------
Net increase from investment
operations $ 0.94 $ 3.56 $ 2.68
Distributions to shareholders:
Net investment income - - (0.02)
Net realized gain (1.83) (0.91) -
------- -------- --------
Net increase (decrease) in net asset value $ (0.89) $ 2.65 $ 2.66
------- -------- --------
Net asset value, end of period $ 14.42 $ 15.31 $ 12.66
======= ======== ========
Total return* 7.76% 29.88% 26.87%
Ratio of net expenses to average net assets 1.40%**+ 1.49%+ 1.54%**+
Ratio of net investment income (loss) to
average net assets (0.49)%**+ (0.76)%+ 0.34%**+
Portfolio turnover rate 58%** 57% 43%**
Average brokerage commission per share $0.0516 $ 0.0497 $ 0.0471
Net assets, end of period (in thousands) $248,110 $252,177 $221,601
Ratios assuming no waiver of management
fees and assumption of expenses by PMC
and no reduction for fees paid indirectly:
Net expenses 1.40%** 1.49% 1.55%**
Net investment income (loss) (0.49)%** (0.76)% 0.33%**
Ratios assuming waiver of management fees
and assumption of expenses by PMC and
reduction for fees paid indirectly:
Net expenses 1.39%** 1.48% 1.51%**
Net investment income (loss) (0.48)%** (0.75)% 0.37%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 19
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 4/30/98
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months 11/2/95
Ended Year Ended to
4/30/98 10/31/97 10/31/96
---------- ---------- --------
<S> <C> <C> <C>
CLASS B
Net asset value, beginning of period $ 15.10 $ 12.59 $ 10.00
-------- -------- --------
Increase (decrease) from investment
operations:
Net investment loss $ (0.07) $ (0.20) $ (0.01)
Net realized and unrealized gain on
investments 0.94 3.62 2.62
-------- -------- --------
Net increase from investment
operations $ 0.87 $ 3.42 $ 2.61
Distributions to shareholders:
In excess of net investment income - - (0.02)
Net realized gain (1.83) (0.91) -
-------- -------- --------
Net increase (decrease) in net asset value $ (0.96) $ 2.51 $ 2.59
-------- -------- --------
Net asset value, end of period $ 14.14 $ 15.10 $ 12.59
======== ======== ========
Total return* 7.36% 28.88% 26.09%
Ratio of net expenses to average net assets 2.11%**+ 2.19%+ 2.26%**+
Ratio of net investment loss to average net
assets (1.19)%**+ (1.46)%+ (0.42)%**+
Portfolio turnover rate 58%** 57% 43%**
Average brokerage commission per share $ 0.0516 $ 0.0497 $ 0.0471
Net assets, end of period (in thousands) $273,860 $267,489 $217,346
Ratios assuming no waiver of management
fees and assumption of expenses by PMC
and no reduction for fees paid indirectly:
Net expenses 2.11%** 2.19% 2.27%**
Net investment loss (1.19)%** (1.46)% (0.43)%**
Ratios assuming waiver of management fees
and assumption of expenses by PMC and
reduction for fees paid indirectly:
Net expenses 2.10%** 2.18% 2.23%**
Net investment loss (1.18)%** (1.45)% (0.39)%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
20 The accompanying notes are an integral part of these financial statements.
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 4/30/98
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months 1/31/96
Ended Year Ended to
4/30/98 10/31/97 10/31/96
--------- --------- --------
<S> <C> <C> <C>
CLASS C
Net asset value, beginning of period $ 15.11 $ 12.59 $ 11.01
------- ------- -------
Increase (decrease) from investment
operations:
Net investment loss $ (0.06) $ (0.21) $ (0.03)
Net realized and unrealized gain on
investments 0.93 3.64 1.61
------- ------- -------
Net increase from investment
operations $ 0.87 $ 3.43 $ 1.58
Distributions to shareholders:
Net realized gain (1.83) (0.91) -
------- ------- -------
Net increase (decrease) in net asset value $ (0.96) $ 2.52 $ 1.58
------- ------- -------
Net asset value, end of period $ 14.15 $ 15.11 $ 12.59
======= ======= =======
Total return* 7.36% 28.96% 14.35%
Ratio of net expenses to average net assets 2.11%**+ 2.17%+ 2.25%**+
Ratio of net investment loss to average net
assets (1.20)%**+ (1.44)%+ (0.45)%**+
Portfolio turnover rate 58%** 57% 43%**
Average brokerage commission per share $0.0516 $0.0497 $0.0471
Net assets, end of period (in thousands) $19,866 $17,927 $16,811
Ratios assuming reduction for fees paid
indirectly:
Net expenses 2.10%** 2.16% 2.21%**
Net investment loss (1.19)%** (1.43)% (0.41)%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio assuming no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 21
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 4/30/98
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Small Company Fund (the Fund) is a Delaware business trust registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objective of the Fund is to seek capital
appreciation.
The Fund offers three classes of shares--Class A, Class B and Class C shares.
Shares of Class A, Class B and Class C each represent an interest in the same
portfolio of investments of the Fund and have equal rights to voting,
redemptions, dividends and liquidation, except that each class of shares can
bear different transfer agent and distribution fees and have exclusive voting
rights with respect to the distribution plans that have been adopted by Class
A, Class B and Class C shareholders, respectively.
The Fund's financial statements have been prepared in conformity with generally
accepted accounting principles that require the management of the Fund to,
among other things, make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amounts
of revenues and expenses during the reporting periods. Actual results could
differ from those estimates. The following is a summary of significant
accounting policies consistently followed by the Fund, which are in conformity
with those generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded on trade date. Each day, securities are
valued at the last sale price on the principal exchange where they are
traded. Securities that have not traded on the date of valuation, or
securities for which sale prices are not generally reported, are valued at
the mean between the last bid and asked prices. Securities for which market
quotations are not readily available are valued at their fair values as
determined by, or under the direction of, the Board of Trustees. Dividend
income is recorded on the ex-dividend date and interest income is recorded
on the accrual basis. Temporary cash investments are valued at amortized
cost.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes. It
is the Fund's practice to first select for sale those securities that have
the highest cost and also qualify for long-term capital gain or loss
treatment for tax purposes.
22
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
B. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareholders. Therefore, no federal income tax provision is required.
The characterization of distributions to shareholders for financial
reporting purposes is determined in accordance with federal income tax
rules. Therefore, the source of the Fund's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
C. Fund Shares
The Fund records sales and repurchases of its shares on trade date. Net
losses, if any, as a result of cancellations, are absorbed by Pioneer Funds
Distributor, Inc. (PFD), the principal underwriter for the Fund and an
indirect subsidiary of The Pioneer Group, Inc. (PGI). PFD earned $59,721 in
underwriting commissions on the sale of fund shares during the six months
ended April 30, 1998.
D. Class Allocations
Distribution fees are calculated based on the average daily net asset value
attributable to Class A, Class B and Class C shares of the Fund,
respectively. Shareholders of each class share all expenses and fees paid to
the transfer agent, Pioneering Services Corporation (PSC), for their
services, which are allocated based on the number of accounts in each class
and the ratable allocation of related out-of-pocket expense (see Note 3).
Income, common expenses and realized and unrealized gains and losses are
calculated at the Fund level and allocated daily to each class of shares
based on the respective percentage of adjusted net assets at the beginning
of the day.
Distributions to shareholders are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B and Class C shares can bear different transfer
agent and distribution fees.
23
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 4/30/98 (continued)
- --------------------------------------------------------------------------------
E. Deferred Organization Costs
The costs incurred by the Fund in connection with its organization have been
deferred and are amortized on a straight-line basis over a period of up to
five years. If Pioneering Management Corporation (PMC) redeems any of its
initial investment prior to the end of the amortization period, the
redemption proceeds will be decreased by the pro rata share of the
unamortized expenses as of the date of redemption. The pro rata share is
derived by dividing the number of original shares redeemed by the total
number of original shares outstanding at the time of redemption.
2. Management Agreement
PMC, the Fund's investment adviser, manages the Fund's portfolio and is a
wholly owned subsidiary of PGI. Management fees are calculated daily at the
annual rate of 0.85% of the Fund's average daily net assets.
In addition, under the management agreement, certain other services and costs,
including accounting, regulatory reporting and insurance premiums, are paid by
the Fund. At April 30, 1998, $384,417 was payable to PMC related to management
fees and certain other services.
3. Transfer Agent
PSC, a wholly owned subsidiary of PGI, provides substantially all transfer
agent and shareholder services to the Fund at negotiated rates. Included in due
to affiliates is $73,342 in transfer agent fees payable to PSC at April 30,
1998.
4. Distribution Plans
The Fund adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan and Class C Plan) in accordance with Rule 12b-1 of the Investment
Company Act of 1940. Pursuant to the Class A Plan, the Fund pays PFD a service
fee of up to 0.25% of the Fund's average daily net assets in reimbursement of
its actual expenditures to finance activities primarily intended to result in
the sale of Class A shares. Pursuant to the Class B Plan and the Class C Plan,
the Fund pays PFD 1.00% of the average daily net assets attributable to each
class of shares. The fee consists of a 0.25% service fee and a 0.75%
distribution fee paid as compensation for personal services and/or account
maintenance services or distribution services with regard to Class B and Class
C shares. Included in due to affiliates is $286,146 in distribution fees
payable to PFD at April 30, 1998.
24
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
In addition, redemptions of each class of shares may be subject to a contingent
deferred sales charge (CDSC). A CDSC of 1.00% may be imposed on redemptions of
certain net asset value purchases of Class A shares within one year of
purchase. Class B shares that are redeemed within six years of purchase are
subject to a CDSC at declining rates beginning at 4.0%, based on the lower of
cost or market value of shares being redeemed. Redemptions of Class C shares
within one year of purchase are subject to a CDSC of 1.00%. Proceeds from the
CDSCs are paid to PFD. For the six months ended April 30, 1998, CDSCs in the
amount of $308,721 were paid to PFD.
5. Expense Offsets
The Fund has entered into certain expense offset arrangements resulting in a
reduction in the Fund's total expenses. For the six months ended April 30,
1998, the Fund's expenses were reduced by $27,774 under such arrangements.
6. Line Of Credit Facility
The Fund, along with certain others in the Pioneer Family of Funds (the
"Funds"), collectively participate in a $50 million committed, unsecured
revolving line of credit facility. Borrowings are used solely for temporary or
emergency purposes. The Fund may borrow up to the lesser of $50 million or the
limits set by its prospectus for borrowings. Interest on collective borrowings
of up to $25 million is payable at the Federal Funds Rate plus 3/8% on an
annualized basis, or at the Federal Funds Rate plus 1/2% if the borrowing
exceeds $25 million at any one time. The Funds pay an annual commitment fee for
this facility. The commitment fee is allocated among such Funds based on their
respective borrowing limits. For the six months ended April 30, 1998, there
were no borrowings under this agreement.
7. Affiliated Companies
The Fund primarily invests in smaller capitalized company securities that tend
to be more sensitive to changes in earnings expectations and have lower trading
volumes than mid to large capitalized company securities, and as a result, they
may experience more abrupt and erratic price movements. The Fund's investment
in these smaller capitalized companies may exceed 5% of the outstanding voting
stock. Such companies are deemed affiliates of the Fund for financial reporting
purposes. The following summarizes transactions with affiliates of the Fund as
of April 30, 1998:
25
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 4/30/98 (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Dividend
Affiliates Purchases Sales Income Value
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Acme Electric Corp. $ -- $ -- $ -- $ 2,909,156
Anacomp, Inc. -- -- -- 12,880,230
Boca Research, Inc. 542,813 83,247 -- 3,846,656
Broadway & Seymour, Inc. 556,960 133,121 -- 5,424,300
Buttrey Food & Drug Stores Co. -- -- -- 8,334,125
Catherines Stores Corp. -- 648,728 -- 5,227,500
Chart House Enterprises, Inc. 4,457,780 -- -- 5,877,300
Chic by H.I.S., Inc. -- 2,703,109 4,980 4,170,750
Cohr, Inc. 5,540,502 -- -- 4,066,406
Crown Vantage, Inc. -- -- -- 6,556,725
Dataflex Corp. -- 225,305 -- 1,431,281
Donnkenny, Inc. 687,032 -- -- 3,448,750
Ferrofluidics Corp. 175,000 -- -- 2,005,000
INTERLINQ Software Corp. -- -- -- 3,267,469
InterTAN, Inc. -- -- -- 7,357,500
Jan Bell Marketing, Inc. -- -- -- 14,098,712
Kentucky Electric Steel, Inc. -- -- -- 2,970,400
Marisa Christina, Inc. -- -- -- 2,484,984
Meridian Data, Inc. -- 1,358,707 -- 3,627,000
NAI Technologies, Inc. 601,533 -- -- 2,443,750
Nashua Corp. -- -- -- 8,064,187
Phar-Mor, Inc. -- 814,035 -- 12,521,050
River Oaks Furniture, Inc. -- -- -- 0
Salient 3 Communications Inc. 455,000 -- 82,911 4,508,518
Signal Technology Corp. -- 210,748 -- 3,790,200
Specialty Chemical Resources, Inc. -- -- -- 387,000
The Leslie Fay Company, Inc. 750,000 -- -- 4,914,000
Transmedia Network Inc. 169,520 -- -- 5,810,025
Uniroyal Technology Corp. 44,312 -- -- 11,756,250
Uranium Resources, Inc. 2,091,157 -- -- 1,803,375
WLR Foods, Inc. 3,615,567 -- -- 5,552,209
Work Group Technology Corp. -- -- -- 2,827,125
----------- ---------- ------- ------------
$19,687,176 $6,177,000 $87,891 $164,361,933
=========== ========== ======= ============
</TABLE>
26
<PAGE>
Pioneer Small Company Fund
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and the Board of Trustees of Pioneer Small Company Fund:
We have audited the accompanying balance sheet, including the schedule of
investments, of Pioneer Small Company Fund as of April 30, 1998, and the
related statement of operations, the statements of changes in net assets, and
the financial highlights for the periods presented. 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
April 30, 1998 by correspondence with the custodian. 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
Pioneer Small Company Fund as of April 30, 1998, the results of its operations,
the changes in its net assets, and the financial highlights for the periods
presented, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
June 5, 1998
27
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Pioneer Small Company Fund
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TRUSTEES, OFFICERS AND SERVICE PROVIDERS
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Trustees Officers
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John F. Cogan, Jr. John F. Cogan, Jr., Chairman and
Mary K. Bush President
Richard H. Egdahl, M.D. David D. Tripple, Executive Vice President
Margaret B.W. Graham Todd E. Grady, Vice President
John W. Kendrick William H. Keough, Treasurer
Marguerite A. Piret Joseph P. Barri, Secretary
David D. Tripple
Stephen K. West
John Winthrop
Investment Adviser
Pioneering Management Corporation
Custodian
Brown Brothers Harriman & Co.
Independent Public Accountants
Arthur Andersen LLP
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneering Services Corporation
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28
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THE PIONEER FAMILY OF MUTUAL FUNDS
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For information about any Pioneer mutual fund, please contact your investment
representative, or call Pioneer at 1-800-225-6292. Ask for a free fund
information kit, which includes a fund prospectus. Please read the prospectus
carefully before you invest or send money.
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Growth Funds Income Funds
Global/International Taxable
Pioneer Emerging Markets Fund Pioneer America Income Trust
Pioneer Europe Fund Pioneer Bond Fund
Pioneer Gold Shares Pioneer Short-Term Income Trust
Pioneer International Growth Fund
Pioneer World Equity Fund Tax-Exempt
Pioneer Intermediate Tax-Free Fund
Pioneer Tax-Free Income Fund
United States
Pioneer Capital Growth Fund
Pioneer Growth Shares Money Market Fund
Pioneer Cash Reserves Fund
Pioneer Micro-Cap Fund
Pioneer Mid-Cap Fund
Pioneer Small Company Fund
Growth and Income Funds
Pioneer Balanced Fund
Pioneer Equity-Income Fund
Pioneer Fund
Pioneer Real Estate Shares
Pioneer II
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29
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HOW TO CONTACT PIONEER
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We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
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Account information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
Pioneering Services Corporation
60 State Street
Boston, Massachusetts 02109
Our toll-free fax 1-800-225-4240
Our Internet e-mail address [email protected]
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
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This report must be preceded or accompanied by a current
Fund prospectus.
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[LOGO]PIONEER Pioneer Funds Distributor, Inc.
60 State Street 0698 - 5285
Boston, Massachusetts 02109 (C) Pioneer Funds Distributor, Inc.
www.pioneerfunds.com (recycle) Printed on Recycled Paper
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