N-CSR 1 ml7181.txt GLOBAL GROWTH UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-8327 Name of Fund: Merrill Lynch Global Growth Fund, Inc. Fund Address: P.O. Box 9011 Princeton, NJ 08543-9011 Name and address of agent for service: Terry K. Glenn, President, Merrill Lynch Global Growth Fund, Inc., 800 Scudders Mill Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton, NJ, 08543-9011 Registrant's telephone number, including area code: (609) 282-2800 Date of fiscal year end: 08/31/04 Date of reporting period: 09/01/03 - 08/31/04 Item 1 - Report to Stockholders (BULL LOGO) Merrill Lynch Investment Managers www.mlim.ml.com Merrill Lynch Global Growth Fund, Inc. Annual Report August 31, 2004 This report is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Fund unless accompanied or preceded by the Fund's current prospectus. Past performance results shown in this report should not be considered a representation of future performance. Investment return and principal value of shares will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Statements and other information herein are as dated and are subject to change. A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling toll-free 1-800-MER-FUND (1-800-637-3863); (2) at www.mutualfunds.ml.com and (3) on the Securities and Exchange Commission's Web site at http://www.sec.gov. Information about how the Fund voted proxies relating to securities held in the Fund's portfolio during the most recent 12-month period ended June 30 is available (1) at www.mutualfunds.ml.com and (2) on the Securities and Exchange Commission's Web site at http://www.sec.gov. Merrill Lynch Global Growth Fund, Inc. Box 9011 Princeton, NJ 08543-9011 (GO PAPERLESS LOGO) It's Fast, Convenient, & Timely! To sign up today, go to www.icsdelivery.com/live. Merrill Lynch Global Growth Fund, Inc. Portfolio Information As of August 31, 2004 Percent of Total Geographic Allocation by Country Investments United States 43.8% Australia 7.1 South Korea 7.0 Germany 4.6 Hong Kong 4.4 United Kingdom 4.0 Canada 3.5 Spain 2.9 France 2.4 Norway 1.9 Japan 1.8 Switzerland 1.7 Denmark 1.5 China 1.4 Sweden 1.0 India 0.8 Other* 10.2 * Includes portfolio holdings in short-term investments. Country of Percent of Ten Largest Equity Holdings Origin Net Assets 3M Co. United States 4.1% Porsche AG (Preferred) Germany 3.0 General Electric Company United States 2.7 Microsoft Corporation United States 2.6 Samsung Electronics South Korea 2.5 eBay Inc. United States 2.1 Gilead Sciences, Inc. United States 2.0 Banco Popular Espanol SA Spain 1.9 Hyundai Motor Company Ltd. South Korea 1.8 A P Moller--Maersk A/S Denmark 1.7 Percent of Five Largest Industries* Net Assets Oil & Gas 12.6% Metals & Mining 10.5 Industrial Conglomerates 8.8 Software 5.5 Health Care Equipment & Supplies 5.3 * For Fund compliance purposes, "Industries" means any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease. These industry classifications are unaudited. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 A Letter From the President Dear Shareholder Equity markets posted positive results for the 12-month reporting period, despite intermittent weakness in the latter months of the year. For the 12 months ended August 31, 2004, the U.S. stock market, as measured by the Standard & Poor's 500 (S&P 500) Index, returned +11.46%. The Morgan Stanley Capital International (MSCI) World Index, which measures the performance of equity markets in 23 developed nations around the world, returned +15.61% for the same 12-month period. Returns over the past six months were not as favorable, with the S&P 500 Index returning -2.74% and the MSCI World Index returning -2.64% as of August 31, 2004. For the most part, equity markets have been supported by improving economies in important areas globally. In the United States, the Federal Reserve Board (the Fed) recently increased the target interest rate from 1% to 1.75% in three separate moves. This represents a shift from a long-run accommodative monetary stance and an indication from the Fed that the U.S. economy is strengthening. Additional interest rate hikes are likely later in 2004, and gross domestic product (GDP) is expected to grow at an annualized rate of 4%. Since the United States represents 32% of global GDP, the acceleration of its economy has provided encouragement to other areas of the world. China has recorded a remarkable rate of economic expansion, which has helped fuel growth in the economies of its trading partners. Given efforts to preempt inflation, China's growth is expected to ease somewhat, but still expand at a rate of approximately 7% in 2004 (compared to 9.8% in 2003). Japan, in the meantime, could register growth of 4% this year after 13 years of sluggish economic activity. Other Asian economies, such as those of South Korea, Malaysia, Singapore, Taiwan and Thailand, appear primed for growth in the area of 5% - 6%. While economic expansion has not been as swift in Europe, the European Union welcomed 10 new member nations in May, and the enhanced integration could provide long-term economic benefits. It appears that the greatest risks going forward are likely to be found in the global economy, global interest rates, oil and commodity prices, and geopolitical factors. As always, our investment professionals are closely monitoring the markets, the economy and the overall environment in an effort to make well-informed decisions for the portfolios they manage. Our goal is to provide shareholders with competitive returns, while always keeping one eye on managing the unavoidable risk inherent in investing. We thank you for trusting Merrill Lynch Investment Managers with your investment assets, and we look forward to serving you in the months and years ahead. Sincerely, (Terry K. Glenn) Terry K. Glenn President and Director MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 A Discussion With Your Fund's Portfolio Manager The Fund provided positive results for the year, outperforming the Lipper Global Large Cap Growth Funds category average, but slightly lagging the return of the benchmark MSCI World Index. How did the Fund perform during the fiscal year in light of the existing market conditions? For the 12-month period ended August 31, 2004, Merrill Lynch Global Growth Fund, Inc.'s Class A, Class B, Class C, Class I and Class R Shares had total returns of +12.78%, +11.89%, +11.89%, +12.93% and +13.13%, respectively. (Fund results shown do not reflect sales charges and would be lower if sales charges were included. Complete performance information can be found on pages 6 - 10 of this report to shareholders.) For the same period, the unmanaged Morgan Stanley Capital International (MSCI) World Index had a total return of +15.61%, and the Lipper Global Large Cap Growth Funds category posted an average return of +10.19%. (Funds in this Lipper category invest primarily in equity securities both inside and outside the United States with relatively large market capitalizations and a focus on above-average growth.) The Fund's relative performance during the fiscal year was suppressed by its focus on the highest-quality and largest- capitalization companies in the MSCI World Index. These companies, as a group, continued to provide a lower average investment return than the smaller-capitalization stocks in the benchmark. In terms of industry sectors, information technology (IT) delivered the most significant performance penalty during the fiscal period. The IT sector declined the most in the sharp global equity market downtrend that occurred in the final months of the period - from July to mid-August 2004. IT stocks that had a meaningful negative effect on Fund performance were Agilent Technologies Inc., Hewlett- Packard Company, Texas Instruments Incorporated, EMC Corp., Intel Corporation, SanDisk Corporation, Motorola, Inc. and Lucent Technologies Inc., all U.S.-based companies. In the second half of the fiscal year, Fund performance was burdened by the notable decline of the stock markets in South Korea, Australia, Hong Kong, Japan and India. We had invested nearly 25% of the Fund's net assets in companies in these countries, based on our belief that the emerging growth of the Pacific Region would provide opportunities for above-average growth in business and profits. Many investors liquidated their equity holdings in these markets after the Chinese government announced plans in March 2004 to restrict real growth in certain industries to prevent a too-rapid expansion of economic growth and rising rates of inflation. In August 2004, as anecdotal evidence grew that the Chinese government was relaxing these restraints, the Pacific Region stock markets began to recover. The Fund's lack of investment exposure to banking and insurance companies in Japan represented an important opportunity cost. Our avoidance of these investments was prompted by our caution about participating in an industry sector where valuation increases are based on takeover speculation. Contributing positively to Fund performance was our focus on stocks in the consumer discretionary and energy sectors. In energy, companies that benefited the Fund's absolute and relative returns were Frontline Ltd. (Norway), Woodside Petroleum Limited (Australia), S-Oil Corp. (South Korea), BG Group PLC (U.K.), Technip SA (France), Suncor Energy, Inc. (Canada), Transocean Inc. (U.S.), Schlumberger Limited (U.S.) and Weatherford International Ltd. (U.S.). Companies in the consumer discretionary sector that made a significant contribution were eBay Inc. (U.S.), Mandalay Resort Group (U.S.), Esprit Holdings Limited (Hong Kong), Porsche AG (Germany), PETsMART, Inc. (U.S.), Chico's FAS Inc. (U.S.) and Station Casinos Inc. (U.S.). We liquidated several of these positions based on the stocks' relatively high valuations. What changes were made to the portfolio during the fiscal year? We did not make any major changes in the sector weightings or the investment strategy of the Fund during the first six months of the fiscal year. We continued to overweight the consumer discretionary, information technology, materials and energy sectors, which we felt could benefit from the burgeoning global economic recovery. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 In the second half of the year, we reduced the Fund's exposure to stocks in the consumer discretionary sector by almost 25%. This was accomplished through the liquidation of our investments in Mandalay Resort Group, PETsMART, Chico's FAS, Ross Stores Inc. (all U.S.), Hennes & Mauritz AB (Sweden), Medion AG (Germany) and Peugeot SA (France). We also reduced our positions in Porsche and Lowe's Companies, Inc. (U.S.). The most meaningful increase in the Fund's investment exposure was in the energy sector. Within energy, we introduced investments in Occidental Petroleum Corporation (U.S.), Statoil ASA (Norway), Sasol Limited (U.S.), Pioneer Natural Resources Company (U.S.), XTO Energy, Inc. (U.S.), Teekay Shipping Corporation (U.S.), Apache Corporation (U.S.), Devon Energy Corporation (U.S.), Smith International, Inc. (U.S.), Grant Prideco, Inc. (U.S.), Cooper Cameron Corporation (U.S.) and National-Oilwell Inc. (U.S.). How would you characterize the Fund's position at the close of the period? We believe the Fund is positioned to benefit from a recovery in economic growth rates globally, as the United States passes through what Federal Reserve Board Chairman Alan Greenspan recently referred to as a "soft patch" in real growth. In our view, China and the United States will continue to be the two fastest-growing economies in the world for the remainder of 2004 and into early 2005. The Fund's investments are focused on companies in the industrials, energy, information technology and materials sectors. Should the coming months bring a recovery in economic growth in the United States and China, we believe these industries could benefit in the form of higher profits and profitability. Finally, we are encouraged by the seemingly positive growth outlooks recently offered by the managements of several major global corporations. Lawrence R. Fuller Vice President and Portfolio Manager September 16, 2004 MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Performance Data About Fund Performance Investors are able to purchase shares of the Fund through multiple pricing alternatives: * Class A Shares incur a maximum initial sales charge (front-end load) of 5.25% and an account maintenance fee of 0.25% per year (but no distribution fee). * Class B Shares are subject to a maximum contingent deferred sales charge of 4% declining to 0% after six years. All Class B Shares purchased prior to June 1, 2001 will maintain the four-year schedule. In addition, Class B Shares are subject to a distribution fee of 0.75% per year and an account maintenance fee of 0.25% per year. These shares automatically convert to Class A Shares after approximately eight years. (There is no initial sales charge for automatic share conversions.) * Class C Shares are subject to a distribution fee of 0.75% per year and an account maintenance fee of 0.25% per year. In addition, Class C Shares are subject to a 1% contingent deferred sales charge if redeemed within one year of purchase. * Class I Shares incur a maximum initial sales charge (front-end load) of 5.25% and bear no ongoing distribution or account maintenance fees. Class I Shares are available only to eligible investors. * Class R Shares do not incur a maximum sales charge (front-end load) or deferred sales charge. These shares are subject to a distribution fee of 0.25% per year and an account maintenance fee of 0.25% per year. Class R Shares are available only to certain retirement plans. None of the past results shown should be considered a representation of future performance. Current performance may be lower or higher than the performance data quoted. Refer to www.mlim.ml.com to obtain more current performance information. Performance results do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Fund is subject to a 2% redemption fee for sales or exchanges of shares within 30 days of purchase. Performance data does not reflect this potential fee. Figures shown in each of the following tables assume reinvestment of all dividends and capital gain distributions, if any, at net asset value on the ex-dividend date. Investment return and principal value of shares will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Dividends paid to each class of shares will vary because of the different levels of account maintenance, distribution and transfer agency fees applicable to each class, which are deducted from the income available to be paid to shareholders. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Performance Data (continued)
Recent Performance Results 6-Month 12-Month Since Inception As of August 31, 2004 Total Return Total Return Total Return ML Global Growth Fund, Inc.--Class A Shares* -5.15% +12.78% +5.49% ML Global Growth Fund, Inc.--Class B Shares* -5.54 +11.89 +0.02 ML Global Growth Fund, Inc.--Class C Shares* -5.54 +11.89 -0.03 ML Global Growth Fund, Inc.--Class I Shares* -5.10 +12.93 +7.22 ML Global Growth Fund, Inc.--Class R Shares* -5.22 +13.13 +28.62 MSCI World Index** -2.64 +15.61 +23.90/+30.29 * Investment results shown do not reflect sales charges; results shown would be lower if a sales charge was included. Total investment returns are based on changes in net asset values for the periods shown, and assume reinvestment of all dividends and capital gains distributions at net asset value on the ex-dividend date. The Fund's inception dates are from 10/31/97 for Class A, Class B, Class C & Class I Shares and from 1/03/03 for Class R Shares. ** This unmanaged market capitalization-weighted Index is comprised of a representative sampling of large-, medium- and small-capitalization companies in 22 countries, including the United States. Since inception total returns are from 10/31/97 and 1/03/03.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Performance Data (continued) TOTAL RETURN BASED ON A $10,000 INVESTMENT Class A & Class B Shares A line graph illustrating the growth of a $10,000 investment in ML Global Growth Fund, Inc.++ Class A and Class B Shares* compared to a similar investment in MSCI World Index++++. Values illustrated are as follows: ML Global Growth Fund, Inc.++ Class A Shares* Date Value 10/31/1997** $ 9,475.00 August 1998 $10,186.00 August 1999 $13,059.00 August 2000 $18,437.00 August 2001 $11,140.00 August 2002 $ 8,202.00 August 2003 $ 8,863.00 August 2004 $ 9,996.00 ML Global Growth Fund, Inc.++ Class B Shares* Date Value 10/31/1997** $10,000.00 August 1998 $10,680.00 August 1999 $13,592.00 August 2000 $19,035.00 August 2001 $11,419.00 August 2002 $ 8,341.00 August 2003 $ 8,940.00 August 2004 $10,002.00 MSCI World Index++++ Date Value 10/31/1997** $10,000.00 August 1998 $10,390.00 August 1999 $13,823.00 August 2000 $15,638.00 August 2001 $11,668.00 August 2002 $ 9,661.00 August 2003 $10,716.00 August 2004 $12,390.00 * Assuming maximum sales charge, transaction costs and other operating expenses, including advisory fees. ** Commencement of operations. ++ ML Global Growth Fund, Inc. invests primarily in equity securities with a particular emphasis on companies that have exhibited above-average growth rates in earnings. ++++ This unmanaged market capitalization-weighted Index is comprised of a representative sampling of large-, medium- and small-capitalization companies in 22 countries, including the United States. Past performance is not predictive of future results. Average Annual Total Return Return Without Return With Sales Charge Sales Charge** Class A Shares* One Year Ended 8/31/04 +12.78% +6.86% Five Years Ended 8/31/04 -5.21 -6.22 Inception (10/31/97) through 8/31/04 +0.79 -0.01 * Maximum sales charge is 5.25%. ** Assuming maximum sales charge. Return Return Without CDSC With CDSC** Class B Shares* One Year Ended 8/31/04 +11.89% +7.89% Five Years Ended 8/31/04 -5.95 -6.26 Inception (10/31/97) through 8/31/04 0.00 0.00 * Maximum contingent deferred sales charge is 4% and is reduced to 0% after six years. ** Assuming payment of applicable contingent deferred sales charge. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Performance Data (continued) TOTAL RETURN BASED ON A $10,000 INVESTMENT Class C & Class I Shares A line graph illustrating the growth of a $10,000 investment in ML Global Growth Fund, Inc.++ Class C and Class I Shares* compared to a similar investment in MSCI World Index++++. Values illustrated are as follows: ML Global Growth Fund, Inc.++ Class C Shares* Date Value 10/31/1997** $10,000.00 August 1998 $10,680.00 August 1999 $13,588.00 August 2000 $19,030.00 August 2001 $11,425.00 August 2002 $ 8,337.00 August 2003 $ 8,935.00 August 2004 $ 9,997.00 ML Global Growth Fund, Inc.++ Class I Shares* Date Value 10/31/1997** $ 9,475.00 August 1998 $10,214.00 August 1999 $13,121.00 August 2000 $18,562.00 August 2001 $11,251.00 August 2002 $ 8,307.00 August 2003 $ 8,996.00 August 2004 $10,159.00 MSCI World Index++++ Date Value 10/31/1997** $10,000.00 August 1998 $10,390.00 August 1999 $13,823.00 August 2000 $15,638.00 August 2001 $11,668.00 August 2002 $ 9,661.00 August 2003 $10,716.00 August 2004 $12,390.00 * Assuming maximum sales charge, transaction costs and other operating expenses, including advisory fees. ** Commencement of operations. ++ ML Global Growth Fund, Inc. invests primarily in equity securities with a particular emphasis on companies that have exhibited above-average growth rates in earnings. ++++ This unmanaged market capitalization-weighted Index is comprised of a representative sampling of large-, medium- and small-capitalization companies in 22 countries, including the United States. Past performance is not predictive of future results. Average Annual Total Return Return Return Without CDSC With CDSC** Class C Shares* One Year Ended 8/31/04 +11.89% +10.89% Five Years Ended 8/31/04 -5.95 -5.95 Inception (10/31/97) through 8/31/04 0.00 0.00 * Maximum contingent deferred sales charge is 1% and is reduced to 0% after one year. ** Assuming payment of applicable contingent deferred sales charge. Return Without Return With Sales Charge Sales Charge** Class I Shares* One Year Ended 8/31/04 +12.93% +7.00% Five Years Ended 8/31/04 -4.99 -6.01 Inception (10/31/97) through 8/31/04 +1.02 +0.23 * Maximum sales charge is 5.25%. ** Assuming maximum sales charge. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Performance Data (concluded) TOTAL RETURN BASED ON A $10,000 INVESTMENT Class R Shares A line graph illustrating the growth of a $10,000 investment in ML Global Growth Fund, Inc.++ Class R Shares* compared to a similar investment in MSCI World Index++++. Values illustrated are as follows: ML Global Growth Fund, Inc.++ Class R Shares* Date Value 1/03/2003** $10,000.00 August 2003 $11,369.00 August 2004 $12,862.00 MSCI World Index++++ Date Value 1/03/2003** $10,000.00 August 2003 $11,270.00 August 2004 $13,029.00 * Assuming maximum sales charge, transaction costs and other operating expenses, including advisory fees. ** Commencement of operations. ++ ML Global Growth Fund, Inc. invests primarily in equity securities with a particular emphasis on companies that have exhibited above-average growth rates in earnings. ++++ This unmanaged market capitalization-weighted Index is comprised of a representative sampling of large-, medium- and small-capitalization companies in 22 countries, including the United States. Past performance is not predictive of future results. Aggregate Total Return Class R Shares Return One Year Ended 8/31/04 +13.13% Inception (1/03/03) through 8/31/04 +16.40 MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Disclosure of Expenses Shareholders of this Fund may incur the following charges: (a) expenses related to transactions, including sales charges, redemption fees and exchange fees; and (b) operating expenses including advisory fees, distribution fees including 12(b)-1 fees, and other Fund expenses. The following example (which is based on a hypothetical investment of $1,000 invested on March 1, 2004 and held through August 31, 2004) is intended to assist shareholders both in calculating expenses based on an investment in the Fund and in comparing these expenses with similar costs of investing in other mutual funds. The first table below provides information about actual account values and actual expenses. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period". The second table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in this Fund and other funds, compare the 5% hypothetical example with the 5% hypothetical examples that appear in other funds' shareholder reports. The expenses shown in the table are intended to highlight shareholders ongoing costs only and do not reflect any transactional expenses, such as sales charges, redemption fees, or exchange fees. Therefore, the second table is useful in comparing ongoing expenses only, and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher.
Expenses Paid Beginning Ending During the Period* Account Value Account Value March 1, 2004 March 1, 2004 August 31, 2004 to August 31, 2004 Actual Class A $1,000 $ 948.50 $ 6.84 Class B $1,000 $ 944.60 $10.71 Class C $1,000 $ 944.60 $10.76 Class I $1,000 $ 949.00 $ 5.62 Class R $1,000 $ 947.80 $ 7.68 Hypothetical (5% annual return before expenses)** Class A $1,000 $1,018.25 $ 7.09 Class B $1,000 $1,014.25 $11.10 Class C $1,000 $1,014.20 $11.15 Class I $1,000 $1,019.51 $ 5.82 Class R $1,000 $1,017.39 $ 7.95 * For each class of the Fund, expenses are equal to the annualized expense ratio for the class (1.39% for Class A, 2.18% for Class B, 2.19% for Class C, 1.14% for Class I and 1.56% for Class R), multiplied by the average account value over the period, multiplied by 186/368 (to reflect the one-half year period shown). ** Hypothetical 5% annual return before expenses is calculated by pro-rating the number of days in the most recent fiscal half-year divided by 368.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Schedule of Investments (in U.S. dollars)
EUROPE Industry* Shares Held Common Stock Value Denmark--1.7% Marine--1.7% 1,275 A P Moller--Maersk A/S $ 8,624,366 Total Common Stock in Denmark 8,624,366 France--2.7% Energy Equipment 24,858 Compagnie Francaise d'Etudes et de Construction & Service--0.8% (Technip SA) 3,721,863 Media--0.9% 168,700 Societe Television Francaise 1 4,733,938 Pharmaceuticals--1.0% 75,000 Sanofi-Aventis 5,323,015 Total Common Stock in France 13,778,816 Germany--2.1% Industrial 97,900 Siemens AG (b) 6,690,126 Conglomerates--1.3% Software--0.3% 9,100 SAP AG (Systeme, Anwendungen, Produkte in der Datenverarbeitung) 1,324,343 Textiles, Apparel & 12,000 Puma AG Rudolf Dassler Sport 2,927,221 Luxury Goods--0.5% Total Common Stock in Germany 10,941,690 Norway--2.1% Oil & Gas--2.1% 153,600 Frontline Limited 5,736,487 400,000 Statoil ASA 5,095,394 --------------- 10,831,881 Total Common Stock in Norway 10,831,881 Spain--3.2% Commercial 180,500 Banco Popular Espanol SA 9,768,175 Banks--1.9% Construction & 416,312 Actividades de Construccion y Servicios, SA (ACS) 7,083,216 Engineering--1.4% Total Common Stock in Spain 16,851,391 Sweden--1.1% Communications 959,700 Telefonaktiebolaget LM Ericsson AB 'B' 2,580,388 Equipment--0.5% Machinery--0.6% 89,000 SKF AB 'B' 3,275,543 Total Common Stock in Sweden 5,855,931 Switzerland--1.9% Health Care Equipment 86,700 Alcon, Inc. 6,488,628 & Supplies--1.9% 32,600 Synthes, Inc. 3,483,538 --------------- 9,972,166 Total Common Stock in Switzerland 9,972,166 United Kingdom-- Household 238,300 Reckitt Benckiser PLC 6,258,869 4.4% Products--1.2% Media--0.8% 457,300 British Sky Broadcasting Group PLC ("BSkyB") 3,932,313 Metals & Mining--1.1% 237,000 Rio Tinto PLC (Registered Shares) 5,879,380 Oil & Gas--1.3% 1,116,000 BG Group PLC 6,876,124 Total Common Stock in the United Kingdom 22,946,686 Total Common Stock in Europe--19.2% 99,802,927
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Schedule of Investments (continued) (in U.S. dollars)
NORTH AMERICA Industry* Shares Held Common Stock Value Canada--3.9% Metals & Mining--1.0% 27,000 Cameco Corporation $ 1,757,172 186,200 Teck Cominco Limited 'B' 3,638,927 --------------- 5,396,099 Oil & Gas--2.9% 291,700 Suncor Energy, Inc. (b) 8,078,425 328,400 TransCanada Corporation (b) 6,851,636 --------------- 14,930,061 Total Common Stock in Canada 20,326,160 United States-- Biotechnology--2.0% 147,400 ++Gilead Sciences, Inc. (b) 10,189,762 48.7% Chemicals--1.3% 60,600 Air Products and Chemicals, Inc. 3,174,228 87,500 Praxair, Inc. 3,550,750 --------------- 6,724,978 Commercial Services 99,800 ++Monster Worldwide Inc. 2,018,954 & Supplies--0.4% Communications 106,900 ++Avaya Inc. 1,295,628 Equipment--3.5% 320,300 ++Cisco Systems, Inc. 6,008,828 1,853,900 ++Lucent Technologies Inc. (b) 5,802,707 300,000 Motorola, Inc. 4,845,000 --------------- 17,952,163 Computers & 426,800 Hewlett-Packard Company 7,635,452 Peripherals--2.3% 195,000 ++SanDisk Corporation (b) 4,553,250 --------------- 12,188,702 Electrical 143,500 Rockwell Automation, Inc. 5,596,500 Equipment--1.1% Electronic Equipment 180,300 ++Agilent Technologies, Inc. 3,696,150 & Instruments--0.9% 36,400 Tektronix, Inc. 1,039,948 --------------- 4,736,098 Energy Equipment 25,000 ++Cooper Cameron Corporation 1,273,250 & Service--3.5% 67,800 Diamond Offshore Drilling, Inc. 1,723,476 75,000 ++Grant Prideco, Inc. 1,370,250 42,000 ++National-Oilwell, Inc. 1,255,800 112,200 Schlumberger Limited 6,933,960 24,500 ++Smith International, Inc. 1,396,010 139,600 ++Transocean Inc. 4,285,720 --------------- 18,238,466 Food Products--0.4% 60,000 McCormick & Company Incorporated 2,013,000 Health Care Equipment 168,500 ++Boston Scientific Corporation 6,020,505 & Supplies--3.4% 139,700 Medtronic, Inc. 6,950,075 143,600 ++Varian Medical Systems, Inc. 4,760,340 --------------- 17,730,920 Hotels, Restaurants 74,500 Station Casinos, Inc. 3,427,000 & Leisure--1.4% 93,100 ++Wynn Resorts, Limited (b) 3,593,660 --------------- 7,020,660 Industrial 258,900 3M Co. 21,323,004 Conglomerates--6.8% 426,700 General Electric Company 13,991,493 --------------- 35,314,497 Internet & Catalog 127,300 ++eBay Inc. 11,016,542 Retail--2.1% Internet Software 77,300 ++Yahoo! Inc. 2,203,823 & Services--0.4% Machinery--2.2% 61,500 Cummins Inc. 4,138,335 124,100 PACCAR Inc. (b) 7,469,579 --------------- 11,607,914
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Schedule of Investments (continued) (in U.S. dollars)
NORTH AMERICA (concluded) Industry* Shares Held Common Stock Value United States Metals & Mining--1.8% 58,800 Freeport-McMoRan Copper & Gold, Inc. (Class B) $ 2,212,644 (concluded) 85,300 Phelps Dodge Corporation (b) 6,957,068 --------------- 9,169,712 Oil & Gas--5.2% 32,600 Apache Corporation 1,456,894 326,300 Chesapeake Energy Corporation (b) 4,610,619 21,800 Devon Energy Corporation 1,412,858 69,900 Frontline Limited 2,629,638 128,600 Occidental Petroleum Corporation 6,642,190 70,000 Pioneer Natural Resources Company 2,341,500 275,000 Sasol Limited (Sponsored ADR) (a) 4,741,000 40,100 Teekay Shipping Corporation 1,405,505 65,200 XTO Energy, Inc. 1,828,208 --------------- 27,068,412 Pharmaceuticals--0.9% 102,400 ++Forest Laboratories, Inc. 4,695,040 Semiconductors 255,800 Intel Corporation 5,445,982 & Semiconductor 191,400 Texas Instruments Incorporated 3,739,956 Equipment--1.8% --------------- 9,185,938 Software--5.2% 117,600 Adobe Systems Incorporated 5,394,312 121,300 ++Electronic Arts Inc. 6,038,314 499,200 Microsoft Corporation 13,628,160 232,700 ++Oracle Corporation 2,320,019 --------------- 27,380,805 Specialty Retail--2.1% 175,100 Best Buy Co., Inc. (b) 8,145,652 50,700 Lowe's Companies, Inc. 2,519,790 --------------- 10,665,442 Total Common Stock in the United States 252,718,328 Total Common Stock in North America--52.6% 273,044,488 PACIFIC BASIN Australia--7.9% Airlines--1.3% 2,833,600 Qantas Airways Limited 6,823,227 Commercial 239,400 Australia and New Zealand Banking Group Ltd. 3,102,109 Banks--0.7% Industrial 182,300 Wesfarmers Limited 3,869,657 Conglomerates--0.7% Media--0.7% 488,871 The News Corporation Limited (b) 3,807,735 Metals & 1,303,400 Alumina Limited 4,997,749 Mining--3.3% 797,400 BHP Billiton Limited 7,393,291 1,396,600 WMC Resources Limited 4,852,148 --------------- 17,243,188 Multiline 1,396,600 Harvey Norman Holdings Limited (b) 2,909,316 Retail--0.6% Road & Rail--0.6% 419,000 Toll Holdings Limited 3,239,851 Total Common Stock in Australia 40,995,083 China--1.5% Internet Software 43,000 ++SINA.com (ADR) (a)(b) 895,690 & Services--0.2% Metals & 8,008,000 Aluminum Corporation of China Limited 3,927,025 Mining--1.3% 2,872,000 Yanzhou Coal Mining Co. Ltd. 'H' 3,111,353 --------------- 7,038,378 Total Common Stock in China 7,934,068
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Schedule of Investments (continued) (in U.S. dollars)
PACIFIC BASIN (concluded) Industry* Shares Held Common Stock Value Hong Kong--4.9% Airlines--1.5% 4,307,000 Cathay Pacific Airways $ 7,564,907 Construction 1,675,000 Cheung Kong Infrastructure Holdings Limited 4,144,571 Materials--0.8% Household 1,919,500 Techtronic Industries Company Limited 3,026,923 Durables--0.6% Marine--0.4% 3,168,000 China Shipping Development Company Limited 'H' 2,193,245 Specialty 728,000 Esprit Holdings Limited 3,509,356 Retail--0.7% Transportation 1,584,000 China Merchants Holdings International Company Infrastructure--0.9% Limited 2,406,477 1,584,000 Cosco Pacific Limited 2,376,015 --------------- 4,782,492 Total Common Stock in Hong Kong 25,221,494 India--0.9% Automobiles--0.4% 167,900 Hero Honda Motors Ltd. 1,603,102 Construction & 67,200 Larsen & Toubro Ltd. 1,206,831 Engineering--0.2% Construction 21,923 ++Ultratech Cemco Ltd. 125,805 Materials--0.0% Metals & Mining--0.3% 285,000 ++Tata Iron and Steel Company Ltd. 1,549,067 Total Common Stock in India 4,484,805 Japan--2.0% Metals & Mining--0.9% 163,500 JFE Holdings, Inc. 4,439,656 Office 125,000 Canon, Inc. 5,945,601 Electronics--1.1% Total Common Stock in Japan 10,385,257 South Korea--7.8% Automobiles--1.8% 218,800 Hyundai Motor Company Ltd. 9,478,769 Chemicals--0.3% 42,300 LG Chem, Ltd. 1,608,491 Diversified 75,600 KT Corporation 2,392,343 Telecommunication Services--0.5% Machinery--0.3% 130,100 Daewoo Shipbuilding & Marine Engineering Co., Ltd. 1,462,686 Metals & Mining--0.8% 29,500 POSCO 4,238,616 Multiline Retail--0.5% 10,000 Shinsegae Co., Ltd. 2,621,869 Oil & Gas--1.1% 139,600 S-Oil Corporation 5,962,860 Semiconductors 32,900 Samsung Electronics 12,881,799 & Semiconductor Equipment--2.5% Total Common Stock in South Korea 40,647,433 Total Common Stock in the Pacific Basin--25.0% 129,668,140 Total Common Stock (Cost--$465,811,101)--96.8% 502,515,555
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Schedule of Investments (concluded) (in U.S. dollars)
EUROPE Industry* Shares Held Preferred Stock Value Germany--3.0% Automobiles--3.0% 25,837 Porsche AG (Preferred) (b) $ 15,692,005 Total Preferred Stock in Europe--3.0% 15,692,005 Total Preferred Stock (Cost--$10,514,380)--3.0% 15,692,005 Beneficial Interest Short-Term Securities $ 1,013,636 Merrill Lynch Liquidity Series, LLC Cash Sweep Series I (c) 1,013,636 58,131,800 Merrill Lynch Liquidity Series, LLC Money Market Series (c)(d) 58,131,800 Total Short-Term Securities (Cost--$59,145,436)--11.4% 59,145,436 Total Investments (Cost--$535,470,917**)--111.2% 577,352,996 Liabilities in Excess of Other Assets--(11.2%) (58,421,884) --------------- Net Assets--100.0% $ 518,931,112 =============== * For Fund compliance purposes, "Industry" means any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease. These industry classifications are unaudited. ** The cost and unrealized appreciation/depreciation of investments as of August 31, 2004 as computed for federal income tax purposes were as follows: Aggregate cost $ 535,551,406 =============== Gross unrealized appreciation $ 72,211,279 Gross unrealized depreciation (30,409,689) --------------- Net unrealized appreciation $ 41,801,590 =============== ++ Non-income producing security. (a) American Depositary Receipts (ADR). (b) Security, or a portion of security, is on loan. (c) Investments in companies considered to be an affiliate of the Fund (such companies are defined as "Affiliated Companies" in Section 2(a)(3) of the Investment Company Act of 1940) were as follows: Interest/ Net Dividend Affiliate Activity Income Merrill Lynch Liquidity Series, LLC Cash Sweep Series I $ 1,013,636 $ 98,172 Merrill Lynch Liquidity Series, LLC Money Market Series $ 12,528,830 $139,512 Merrill Lynch Premier Institutional Fund (30,401,980) $ 36,467 (d) Security was purchased with the cash proceeds from securities loans. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Statement of Assets and Liabilities
As of August 31, 2004 Assets Investments in unaffiliated securities, at value (including securities loaned of $55,663,024) (identified cost--$476,325,481) $ 518,207,560 Investments in affiliated securities, at value (identified cost--$59,145,436) 59,145,436 Foreign cash (cost--$327,731) 329,004 Receivables: Securities sold $ 5,165,446 Dividends 1,531,411 Capital shares sold 29,258 Securities lending--net 12,725 Interest from affiliates 10,237 6,749,077 --------------- Prepaid expenses 137,696 --------------- Total assets 584,568,773 --------------- Liabilities Collateral on securities loaned, at value 58,131,800 Payables: Securities purchased 5,376,586 Capital shares redeemed 1,463,810 Distributor 296,407 Other affiliates 243,215 Investment adviser 42,776 7,422,794 --------------- Accrued expenses and other liabilities 83,067 --------------- Total liabilities 65,637,661 --------------- Net Assets Net assets $ 518,931,112 =============== Net Assets Consist of Class A Shares of Common Stock, $.10 par value, 100,000,000 shares authorized $ 1,163,618 Class B Shares of Common Stock, $.10 par value, 300,000,000 shares authorized 3,086,268 Class C Shares of Common Stock, $.10 par value, 100,000,000 shares authorized 742,381 Class I Shares of Common Stock, $.10 par value, 100,000,000 shares authorized 1,246,991 Class R Shares of Common Stock, $.10 par value, 300,000,000 shares authorized 1,982 Paid-in capital in excess of par 1,092,482,529 Undistributed investment income--net $ 349,326 Accumulated realized capital losses--net (622,055,065) Unrealized appreciation--net 41,913,082 --------------- Total accumulated losses--net (579,792,657) --------------- Net Assets $ 518,931,112 =============== Net Asset Value Class A--Based on net assets of $98,518,955 and 11,636,181 shares outstanding $ 8.47 =============== Class B--Based on net assets of $252,690,827 and 30,862,679 shares outstanding $ 8.19 =============== Class C--Based on net assets of $60,770,841 and 7,423,813 shares outstanding $ 8.19 =============== Class I--Based on net assets of $106,784,842 and 12,469,906 shares outstanding $ 8.56 =============== Class R--Based on net assets of $165,647 and 19,820 shares outstanding $ 8.36 =============== See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Statement of Operations
For the Year Ended August 31, 2004 Investment Income Dividends (net of $785,584 foreign withholding tax) $ 13,452,782 Interest from affiliates 98,172 Securities lending--net 175,979 --------------- Total income 13,726,933 --------------- Expenses Investment advisory fees $ 4,645,567 Account maintenance and distribution fees--Class B 3,099,318 Transfer agent fees--Class B 830,713 Account maintenance and distribution fees--Class C 707,483 Transfer agent fees--Class I 292,612 Account maintenance fees--Class A 278,388 Accounting services 260,569 Transfer agent fees--Class A 255,878 Transfer agent fees--Class C 200,834 Custodian fees 187,053 Professional fees 83,031 Printing and shareholder reports 76,532 Directors' fees and expenses 72,071 Registration fees 64,566 Pricing fees 10,694 Account maintenance and distribution fees--Class R 343 Transfer agent fees--Class R 175 Other 166,442 --------------- Total expenses 11,232,269 --------------- Investment income--net 2,494,664 --------------- Realized & Unrealized Gain (Loss)--Net Realized gain (loss) on: Investments--net 114,280,152 Foreign currency transactions--net (1,028,936) 113,251,216 --------------- Change in unrealized appreciation/depreciation on: Investments--net (36,659,736) Foreign currency transactions--net 169,995 (36,489,741) --------------- --------------- Total realized and unrealized gain--net 76,761,475 --------------- Net Increase in Net Assets Resulting from Operations $ 79,256,139 =============== See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Statements of Changes in Net Assets
For the Year Ended August 31, Increase (Decrease) in Net Assets: 2004 2003 Operations Investment income (loss)--net $ 2,494,664 $ (1,039,227) Realized gain (loss)--net 113,251,216 (201,969,464) Change in unrealized appreciation/depreciation--net (36,489,741) 233,728,261 --------------- --------------- Net increase in net assets resulting from operations 79,256,139 30,719,570 --------------- --------------- Capital Share Transactions Net decrease in net assets derived from capital share transactions (203,244,671) (125,144,756) --------------- --------------- Redemption Fees Redemption fees (293) -- --------------- --------------- Net Assets Total decrease in net assets (123,988,825) (94,425,186) Beginning of year 642,919,937 737,345,123 --------------- --------------- End of year* $ 518,931,112 $ 642,919,937 =============== =============== * Undistributed investment income (loss)--net $ 349,326 $ (1,222,767) =============== =============== See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Financial Highlights
The following per share data and ratios have been derived from information provided in the financial statements. Class A For the Year Ended August 31, Increase (Decrease) in Net Asset Value: 2004 2003 2002 2001 2000 Per Share Operating Performance Net asset value, beginning of year $ 7.51 $ 6.95 $ 9.44 $ 17.95 $ 13.51 ---------- ---------- ---------- ---------- ---------- Investment income (loss)--net** .07 .03 (.02) --++ (.06) Realized and unrealized gain (loss)--net .89 .53 (2.47) (6.64) 5.50 ---------- ---------- ---------- ---------- ---------- Total from investment operations .96 .56 (2.49) (6.64) 5.44 ---------- ---------- ---------- ---------- ---------- Less distributions from: Realized gain--net -- -- -- (.58) (1.00) In excess of realized gain--net -- -- -- (1.29) -- ---------- ---------- ---------- ---------- ---------- Total distributions -- -- -- (1.87) (1.00) ---------- ---------- ---------- ---------- ---------- Net asset value, end of year $ 8.47 $ 7.51 $ 6.95 $ 9.44 $ 17.95 ========== ========== ========== ========== ========== Total Investment Return* Based on net asset value per share 12.78% 8.06% (26.38%) (39.58%) 41.18% ========== ========== ========== ========== ========== Ratios to Average Net Assets Expenses 1.37% 1.42% 1.31% 1.18% 1.12% ========== ========== ========== ========== ========== Investment income (loss)--net .87% .40% (.18%) (.001%) (.35%) ========== ========== ========== ========== ========== Supplemental Data Net assets, end of year (in thousands) $ 98,519 $ 110,092 $ 130,310 $ 240,027 $ 511,367 ========== ========== ========== ========== ========== Portfolio turnover 71.91% 121.00% 105.73% 126.37% 75.48% ========== ========== ========== ========== ========== * Total investment return excludes the effects of sales charges. ** Based on average shares outstanding. ++ Amount is less than $(.01) per share. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Financial Highlights (continued)
The following per share data and ratios have been derived from information provided in the financial statements. Class B For the Year Ended August 31, Increase (Decrease) in Net Asset Value: 2004 2003 2002 2001 2000 Per Share Operating Performance Net asset value, beginning of year $ 7.32 $ 6.83 $ 9.35 $ 17.75 $ 13.39 ---------- ---------- ---------- ---------- ---------- Investment income (loss)--net** --++ (.03) (.08) (.10) (.18) Realized and unrealized gain (loss)--net .87 .52 (2.44) (6.56) 5.44 ---------- ---------- ---------- ---------- ---------- Total from investment operations .87 .49 (2.52) (6.66) 5.26 ---------- ---------- ---------- ---------- ---------- Less distributions from: Realized gain--net -- -- -- (.54) (.90) In excess of realized gain--net -- -- -- (1.20) -- ---------- ---------- ---------- ---------- ---------- Total distributions -- -- -- (1.74) (.90) ---------- ---------- ---------- ---------- ---------- Net asset value, end of year $ 8.19 $ 7.32 $ 6.83 $ 9.35 $ 17.75 ========== ========== ========== ========== ========== Total Investment Return* Based on net asset value per share 11.89% 7.17% (26.95%) (40.01%) 40.04% ========== ========== ========== ========== ========== Ratios to Average Net Assets Expenses 2.16% 2.22% 2.09% 1.95% 1.88% ========== ========== ========== ========== ========== Investment income (loss)--net .05% (.43%) (.99%) (.77%) (1.11%) ========== ========== ========== ========== ========== Supplemental Data Net assets, end of year (in thousands) $ 252,691 $ 327,483 $ 456,393 $1,046,889 $2,293,020 ========== ========== ========== ========== ========== Portfolio turnover 71.91% 121.00% 105.73% 126.37% 75.48% ========== ========== ========== ========== ========== * Total investment return excludes the effects of sales charges. ** Based on average shares outstanding. ++ Amount is less than $.01 per share. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Financial Highlights (continued)
The following per share data and ratios have been derived from information provided in the financial statements. Class C For the Year Ended August 31, Increase (Decrease) in Net Asset Value: 2004 2003 2002 2001 2000 Per Share Operating Performance Net asset value, beginning of year $ 7.32 $ 6.83 $ 9.36 $ 17.76 $ 13.39 ---------- ---------- ---------- ---------- ---------- Investment income (loss)--net** --++ (.03) (.08) (.10) (.19) Realized and unrealized gain (loss)--net .87 .52 (2.45) (6.56) 5.45 ---------- ---------- ---------- ---------- ---------- Total from investment operations .87 .49 (2.53) (6.66) 5.26 ---------- ---------- ---------- ---------- ---------- Less distributions from: Realized gain--net -- -- -- (.54) (.89) In excess of realized gain--net -- -- -- (1.20) -- ---------- ---------- ---------- ---------- ---------- Total distributions -- -- -- (1.74) (.89) ---------- ---------- ---------- ---------- ---------- Net asset value, end of year $ 8.19 $ 7.32 $ 6.83 $ 9.36 $ 17.76 ========== ========== ========== ========== ========== Total Investment Return* Based on net asset value per share 11.89% 7.17% (27.03%) (39.97%) 40.05% ========== ========== ========== ========== ========== Ratios to Average Net Assets Expenses 2.18% 2.24% 2.11% 1.96% 1.89% ========== ========== ========== ========== ========== Investment income (loss)--net .05% (.43%) (.99%) (.78%) (1.12%) ========== ========== ========== ========== ========== Supplemental Data Net assets, end of year (in thousands) $ 60,771 $ 72,249 $ 95,117 $ 197,356 $ 423,800 ========== ========== ========== ========== ========== Portfolio turnover 71.91% 121.00% 105.73% 126.37% 75.48% ========== ========== ========== ========== ========== * Total investment return excludes the effects of sales charges. ** Based on average shares outstanding. ++ Amount is less than $.01 per share. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Financial Highlights (continued)
The following per share data and ratios have been derived from information provided in the financial statements. Class I For the Year Ended August 31, Increase (Decrease) in Net Asset Value: 2004 2003 2002 2001 2000 Per Share Operating Performance Net asset value, beginning of year $ 7.58 $ 7.00 $ 9.48 $ 18.01 $ 13.55 ---------- ---------- ---------- ---------- ---------- Investment income (loss)--net** .09 .04 --++ .03 (.02) Realized and unrealized gain (loss)--net .89 .54 (2.48) (6.65) 5.51 ---------- ---------- ---------- ---------- ---------- Total from investment operations .98 .58 (2.48) (6.62) 5.49 ---------- ---------- ---------- ---------- ---------- Less distributions from: Realized gain--net -- -- -- (.59) -- In excess of realized gain--net -- -- -- (1.32) (1.03) ---------- ---------- ---------- ---------- ---------- Total distributions -- -- -- (1.91) (1.03) ---------- ---------- ---------- ---------- ---------- Net asset value, end of year $ 8.56 $ 7.58 $ 7.00 $ 9.48 $ 18.01 ========== ========== ========== ========== ========== Total Investment Return* Based on net asset value per share 12.93% 8.29% (26.16%) (39.39%) 41.47% ========== ========== ========== ========== ========== Ratios to Average Net Assets Expenses 1.13% 1.16% 1.06% .93% .87% ========== ========== ========== ========== ========== Investment income (loss)--net 1.05% .63% .04% .25% (.09%) ========== ========== ========== ========== ========== Supplemental Data Net assets, end of year (in thousands) $ 106,785 $ 133,096 $ 55,525 $ 155,922 $ 288,517 ========== ========== ========== ========== ========== Portfolio turnover 71.91% 121.00% 105.73% 126.37% 75.48% ========== ========== ========== ========== ========== * Total investment return excludes the effects of sales charges. ** Based on average shares outstanding. ++ Amount is less than $.01 per share. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Financial Highlights (concluded)
Class R For the For the Period The following per share data and ratios have been derived Year January 3, from information provided in the financial statements. Ended 2003++ to August 31, August 31, Increase in Net Asset Value: 2004 2003 Per Share Operating Performance Net asset value, beginning of period $ 7.39 $ 6.50 ------------ ------------ Investment income--net*** .08 .06 Realized and unrealized gain--net .89 .83 ------------ ------------ Total from investment operations .97 .89 ------------ ------------ Net asset value, end of period $ 8.36 $ 7.39 ============ ============ Total Investment Return** Based on net asset value per share 13.13% 13.69%+++ ============ ============ Ratios to Average Net Assets Expenses 1.56% 1.64%* ============ ============ Investment income--net 1.36% .66%* ============ ============ Supplemental Data Net assets, end of period (in thousands) $ 166 --+++++ ============ ============ Portfolio turnover 71.91% 121.00% ============ ============ * Annualized. ** Total investment return excludes the effects of sales charges. *** Based on average shares outstanding. ++ Commencement of operations. +++ Aggregate total investment return. +++++ Amount is less than $1,000. See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements 1. Significant Accounting Policies: Merrill Lynch Global Growth Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The Fund's financial statements are prepared in conformity with U.S. generally accepted accounting principles, which may require the use of management accruals and estimates. Actual results may differ from these estimates. The Fund offers multiple classes of shares. Shares of Class A and Class I are sold with a front-end sales charge. Shares of Class B and Class C may be subject to a contingent deferred sales charge. Class R Shares are sold only to certain retirement plans. All classes of shares have identical voting, dividend, liquidation and other rights and the same terms and conditions, except that Class A, Class B, Class C and Class R Shares bear certain expenses related to the account maintenance of such shares, and Class B, Class C and Class R Shares also bear certain expenses related to the distribution of such shares. Each class has exclusive voting rights with respect to matters relating to its account maintenance and distribution expenditures (except that Class B shareholders have voting rights with respect to material changes to the Class A distribution plan). Income, expenses (other than expenses attributable to a specific class) and realized and unrealized gains and losses on investments and foreign currency transactions are allocated daily to each class based on its relative net assets. The following is a summary of significant accounting policies followed by the Fund. (a) Valuation of investments--Equity securities that are held by the Fund that are traded on stock exchanges or the Nasdaq National Market are valued at the last sale price or official close price on the exchange, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price for long positions, and at the last available ask price for short positions. In cases where equity securities are traded on more than one exchange, the securities are valued on the exchange designated as the primary market by or under the authority of the Board of Directors of the Fund. Long positions traded in the over- the-counter ("OTC") market, Nasdaq Small Cap or Bulletin Board are valued at the last available bid price or yield equivalent obtained from one or more dealers or pricing services approved by the Board of Directors of the Fund. Short positions traded in the OTC market are valued at the last available ask price. Portfolio securities that are traded both in the OTC market and on a stock exchange are valued according to the broadest and most representative market. Options written are valued at the last sale price in the case of exchange-traded options or, in the case of options traded in the OTC market, the last ask price. Options purchased are valued at their last sale price in the case of exchange-traded options or, in the case of options traded in the OTC market, the last bid price. Swap agreements are valued daily based upon quotations from market makers. Financial futures contracts and options thereon, which are traded on exchanges, are valued at their last sale price as of the close of such exchanges. Obligations with remaining maturities of 60 days or less are valued at amortized cost unless the Investment Adviser believes that this method no longer produces fair valuations. Repurchase agreements are valued at cost plus accrued interest. The Fund employs pricing services to provide certain securities prices for the Fund. Securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith by or under the direction of the Board of Directors of the Fund, including valuations furnished by the pricing services retained by the Fund, which may use a matrix system for valuations. The procedures of a pricing service and its valuations are reviewed by the officers of the Fund under the general supervision of the Fund's Board of Directors. Such valuations and procedures will be reviewed periodically by the Board of Directors of the Fund. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements (continued) Generally, trading in foreign securities, as well as U.S. government securities and money market instruments, is substantially completed each day at various times prior to the close of business on the New York Stock Exchange ("NYSE"). The values of such securities used in computing the net asset value of the Fund's shares are determined as of such times. Foreign currency exchange rates also are generally determined prior to the close of business on the NYSE. Occasionally, events affecting the values of such securities and such exchange rates may occur between the times at which they are determined and the close of business on the NYSE that may not be reflected in the computation of the Fund's net asset value. If events (for example, a company announcement, market volatility or a natural disaster) occur during such periods that are expected to materially affect the value of such securities, those securities may be valued at their fair value as determined in good faith by the Fund's Board of Directors or by the Investment Adviser using a pricing service and/or procedures approved by the Fund's Board of Directors. (b) Foreign currency transactions--Transactions denominated in foreign currencies are recorded at the exchange rate prevailing when recognized. Assets and liabilities denominated in foreign currencies are valued at the exchange rate at the end of the period. Foreign currency transactions are the result of settling (realized) or valuing (unrealized) assets or liabilities expressed in foreign currencies into U.S. dollars. Realized and unrealized gains or losses from investments include the effects of foreign exchange rates on investments. (c) Derivative financial instruments--The Fund may engage in various portfolio investment strategies both to increase the return of the Fund and to hedge, or protect, its exposure to interest rate movements and movements in the securities markets. Losses may arise due to changes in the value of the contract or if the counterparty does not perform under the contract. * Options--The Fund may write and purchase call and put options. When the Fund writes an option, an amount equal to the premium received by the Fund is reflected as an asset and an equivalent liability. The amount of the liability is subsequently marked-to- market to reflect the current market value of the option written. When a security is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the security acquired or deducted from (or added to) the proceeds of the security sold. When an option expires (or the Fund enters into a closing transaction), the Fund realizes a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premium paid or received). Written and purchased options are non-income producing investments. * Forward foreign exchange contracts--The Fund may enter into forward foreign exchange contracts as a hedge against either specific transactions or portfolio positions. The contract is marked- to-market daily and the change in market value is recorded by the Fund as an unrealized gain or loss. When the contract 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. * Foreign currency options and futures--The Fund may also purchase or sell listed or over-the-counter foreign currency options, foreign currency futures and related options on foreign currency futures as a short or long hedge against possible variations in foreign exchange rates. Such transactions may be effected with respect to hedges on non-U.S. dollar denominated securities owned by the Fund, sold by the Fund but not yet delivered, or committed or anticipated to be purchased by the Fund. * Financial futures contracts--The Fund may purchase or sell financial futures contracts and options on such futures contracts for the purpose of hedging the market risk on existing securities or the intended purchase of securities. Futures contracts are contracts for delayed delivery of securities at a specific future date and at a specific price or yield. Upon entering into a contract, the Fund deposits and maintains as collateral such initial margin as required by the exchange on which the transaction is effected. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin and are recorded by the Fund as unrealized gains or losses. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements (continued) (d) 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 substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required. Under the applicable foreign tax law, a withholding tax may be imposed on interest, dividends, and capital gains at various rates. (e) Security transactions and investment income--Security transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on security transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when the Fund has determined the ex-dividend date. Interest income is recognized in the accrual basis. (f) Prepaid registration fees--Prepaid registration fees are charged to expense as the related shares are issued. (g) Dividends and distributions--Dividends and distributions paid by the Fund are recorded on the ex-dividend dates. (h) Securities lending--The Fund may lend securities to financial institutions that provide cash or securities issued or guaranteed by the U.S. government as collateral, which will be maintained at all times in an amount equal to at least 100% of the current market value of the loaned securities. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. Where the Fund receives securities as collateral for the loaned securities, it collects a fee from the borrower. The Fund typically receives the income on the loaned securities but does not receive the income on the collateral. Where the Fund receives cash collateral, it may invest such collateral and retain the amount earned on such investment, net of any amount rebated to the borrower. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within five business days. The Fund may pay reasonable finder's, lending agent, administrative and custodial fees in connection with its loans. In the event that the borrower defaults on its obligation to return borrowed securities because of insolvency or for any other reason, the Fund could experience delays and costs in gaining access to the collateral. The Fund also could suffer a loss where the value of the collateral falls below the market value of the borrowed securities, in the event of borrower default or in the event of losses on investments made with cash collateral. (i) Reclassifications--U.S. generally accepted accounting principles require that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. Accordingly, during the current year, $1,028,936 has been reclassified between undistributed net investment income and accumulated net realized capital losses and foreign currency transactions, and $106,365 has been reclassified between paid-in capital in excess of par and undistributed net investment income as a result of permanent differences attributable to transaction gains/losses and nondeductible expenses. These reclassifications have no effect on net assets or net asset values per share. 2. Investment Advisory Agreement and Transactions with Affiliates: The Fund has entered into an Investment Advisory Agreement with Merrill Lynch Investment Managers, L.P. ("MLIM"). The general partner of MLIM is Princeton Services, Inc. ("PSI"), an indirect, wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the limited partner. The Fund has also entered into a Distribution Agreement and Distribution Plans with FAM Distributors, Inc. ("FAMD" or the "Distributor"), which is a wholly-owned subsidiary of Merrill Lynch Group, Inc. MLIM is responsible for the management of the Fund's portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of the Fund. For such services, the Fund pays a monthly fee based upon the average daily value of the Fund's net assets at an annual rate of .75% of the average daily net assets not exceeding $1.5 billion and .725% of the average daily net assets in excess of $1.5 billion. MLIM has entered into a Sub-Advisory Agreement with Merrill Lynch Asset Management U.K. Limited ("MLAM U.K."), an affiliate of MLIM, pursuant to which MLAM U.K. provides investment advisory services to MLIM with respect to the Fund. There is no increase in the aggregate fees paid by the Fund for these services. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements (continued) Pursuant to the Distribution Plans adopted by the Fund in accordance with Rule 12b-1 under the Investment Company Act of 1940, the Fund pays the Distributor ongoing account maintenance and distribution fees. The fees are accrued daily and paid monthly at annual rates based upon the average daily net assets of the shares as follows: Account Maintenance Distribution Fee Fee Class A .25% -- Class B .25% .75% Class C .25% .75% Class R .25% .25% Pursuant to a sub-agreement with the Distributor, Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S"), a subsidiary of ML & Co., also provides account maintenance and distribution services to the Fund. The ongoing account maintenance fee compensates the Distributor and MLPF&S for providing account maintenance services to Class A, Class B, Class C and Class R shareholders. The ongoing distribution fee compensates the Distributor and MLPF&S for providing shareholder and distribution- related services to Class B, Class C and Class R shareholders. For the year ended August 31, 2004, FAMD earned underwriting discounts and direct commissions and MLPF&S earned dealer concessions on sales of the Fund's Class A and Class I Shares as follows: FAMD MLPF&S Class A $ 822 $ 11,852 Class I $ 105 $ 1,491 For the year ended August 31, 2004, MLPF&S received contingent deferred sales charges of $126,508 and $2,154 relating to transactions in Class B and Class C Shares, respectively. The Fund has received an exemptive order from the Securities and Exchange Commission permitting it to lend portfolio securities to MLPF&S or its affiliates. As of August 31, 2004, the Fund lent securities with a value of $6,188,010 to MLPF&S. Pursuant to that order, the Fund also has retained Merrill Lynch Investment Managers, LLC ("MLIM, LLC"), an affiliate of MLIM, as the securities lending agent for a fee based on a share of the returns on investment of cash collateral. MLIM, LLC may, on behalf of the Fund, invest cash collateral received by the Fund for such loans, among other things, in a private investment company managed by MLIM, LLC or in registered money market funds advised by MLIM or its affiliates. For the year ended August 31, 2004, MLIM, LLC received $75,653 in securities lending agent fees. In addition, MLPF&S received $250,562 in commissions on the execution of portfolio security transactions for the Fund for the year ended August 31, 2004. For the year ended August 31, 2004, the Fund reimbursed MLIM $12,707 for certain accounting services. Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of ML & Co., is the Fund's transfer agent. Certain officers and/or directors of the Fund are officers and/or directors of MLIM, PSI, MLAM U.K., FDS, FAMD, and/or ML & Co. 3. Investments: Purchases and sales of investments, excluding short-term securities, for the year ended August 31, 2004 were $433,419,806 and $641,011,188, respectively. 4. Capital Share Transactions: Net decrease in net assets derived from capital share transactions was $203,244,964 and $125,144,756 for the years ended August 31, 2004 and August 31, 2003, respectively. Transactions in capital shares for each class were as follows: Class A Shares for the Year Dollar Ended August 31, 2004 Shares Amount Shares sold 707,209 $ 5,969,716 Automatic conversion of shares 1,437,615 12,282,386 --------------- ---------------- Total issued 2,144,824 18,252,102 Shares redeemed (5,172,582) (43,630,780) --------------- ---------------- Net decrease (3,027,758) $ (25,378,678) =============== ================ MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements (continued) Class A Shares for the Year Dollar Ended August 31, 2003 Shares Amount Shares sold 1,447,586 $ 9,404,253 Automatic conversion of shares 1,605,746 10,648,241 Shares issued resulting from reorganization 745,332 5,241,248 --------------- ---------------- Total issued 3,798,664 25,293,742 Shares redeemed (7,871,569) (51,893,742) --------------- ---------------- Net decrease (4,072,905) $ (26,558,031) =============== ================ Class B Shares for the Year Dollar Ended August 31, 2004 Shares Amount Shares sold 1,044,170 $ 8,602,162 Automatic conversion of shares (1,480,598) (12,282,386) Shares redeemed (13,450,908) (110,144,927) --------------- ---------------- Net decrease (13,887,336) $ (113,825,151) =============== ================ Class B Shares for the Year Dollar Ended August 31, 2003 Shares Amount Shares sold 1,101,287 $ 7,120,141 Shares issued resulting from reorganization 271,517 1,862,806 --------------- ---------------- Total issued 1,372,804 8,982,947 Automatic conversion of shares (1,639,784) (10,648,241) Shares redeemed (21,773,344) (140,152,217) --------------- ---------------- Net decrease (22,040,324) $ (141,817,511) =============== ================ Class C Shares for the Year Dollar Ended August 31, 2004 Shares Amount Shares sold 308,528 $ 2,566,158 Shares redeemed (2,757,830) (22,547,416) --------------- ---------------- Net decrease (2,449,302) $ (19,981,258) =============== ================ Class C Shares for the Year Dollar Ended August 31, 2003 Shares Amount Shares sold 307,912 $ 2,004,970 Shares issued resulting from reorganization 48,496 332,713 --------------- ---------------- Total issued 356,408 2,337,683 Shares redeemed (4,400,754) (28,280,421) --------------- ---------------- Net decrease (4,044,346) $ (25,942,738) =============== ================ Class I Shares for the Year Dollar Ended August 31, 2004 Shares Amount Shares sold 2,353,975 $ 19,989,818 Shares redeemed (7,454,281) (64,226,677) --------------- ---------------- Net decrease (5,100,306) $ (44,236,859) =============== ================ Class I Shares for the Year Dollar Ended August 31, 2003 Shares Amount Shares sold 1,162,683 $ 7,798,444 Shares issued resulting from reorganization 11,510,221 81,644,938 --------------- ---------------- Total issued 12,672,904 89,443,382 Shares redeemed (3,035,018) (20,269,958) --------------- ---------------- Net increase 9,637,886 $ 69,173,424 =============== ================ Class R Shares for the Year Dollar Ended August 31, 2004 Shares Amount Shares sold 21,035 $ 187,377 Shares redeemed (1,230) (10,395) --------------- ---------------- Net increase 19,805 $ 176,982 =============== ================ Class R Shares for the Period January 3, 2003++ Dollar to August 31, 2003 Shares Amount Shares sold 15 $ 100 --------------- ---------------- Net increase 15 $ 100 =============== ================ ++ Commencement of operations. The Fund charges a 2% redemption fee on the proceeds (calculated at market value) of a redemption (either by sale or exchange) of Fund shares made within 30 days of purchase. The redemption fee is paid to the Fund and is intended to offset the trading costs, market impact and other costs associated with short-term trading into and out of the Fund. For the year ended August 31, 2004, the Fund charged a redemption fee of $293. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Notes to Financial Statements (concluded) 5. Short-Term Borrowings: The Fund, along with certain other funds managed by MLIM and its affiliates, is a party to a $500,000,000 credit agreement with Bank One, N.A. and certain other lenders. The Fund may borrow under the credit agreement to fund shareholder redemptions and for other lawful purposes other than for leverage. The Fund may borrow up to the maximum amount allowable under the Fund's current prospectus and statement of additional information, subject to various other legal, regulatory or contractual limits. The Fund pays a commitment fee of .09% per annum based on the Fund's pro rata share of the unused portion of the credit agreement. Amounts borrowed under the credit agreement bear interest at a rate equal to, at each fund's election, the federal funds rate plus .50% or a base rate as determined by Bank One, N.A. On November 28, 2003, the credit agreement was renewed for one year under the same terms. The Fund did not borrow under the credit agreement during the year ended August 31, 2004. 6. Commitments: At August 31, 2004, the Fund had entered into foreign exchange contracts, under which it had agreed to sell various foreign currency with an approximate value of $28,000. 7. Distributions to Shareholders: As of August 31, 2004, the components of accumulated losses on a tax basis were as follows: Undistributed ordinary income--net $ 347,003 Undistributed long-term capital gains--net -- ---------------- Total undistributed earnings--net 347,003 Capital loss carryforward (621,974,577)* Unrealized gains--net 41,834,917** ---------------- Total accumulated losses--net $ (579,792,657) ================ * On August 31, 2004, the Fund had a net capital loss carry- forward of $621,974,577, of which $19,389,728 expires in 2008, $3,964,136 expires in 2009, $246,071,814 expires in 2010 and $352,548,899 expires in 2011. This amount will be available to offset like amounts of any future taxable gains. ** The difference between book-basis and tax-basis net unrealized gains is attributable primarily to the tax deferral of losses on wash sales and the realization for tax purposes of unrealized gains (losses) on certain foreign currency contracts. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors, Merrill Lynch Global Growth Fund, Inc. We have audited the accompanying statement of assets and liabilities of Merrill Lynch Global Growth Fund, Inc., including the schedule of investments, as of August 31, 2004, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and financial highlights for each of the periods indicated therein. 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 the standards of the Public Company Accounting Oversight Board (United States). 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 and financial highlights. Our procedures included confirmation of securities owned as of August 31, 2004, by correspondence with the custodian and others. 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 Merrill Lynch Global Growth Fund, Inc. at August 31, 2004, results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the indicated periods in conformity with U.S. generally accepted accounting principles. (Ernst & Young LLP) Philadelphia, Pennsylvania October 15, 2004 MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Officers and Directors (unaudited)
Number of Portfolios in Other Public Position(s) Length of Fund Complex Directorships Held with Time Overseen by Held by Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years Director Director Interested Director Terry K. Glenn* President 1999 to President of the Merrill Lynch Investment 124 Funds None P.O. Box 9011 and present Managers, L.P. ("MLIM")/Fund Asset 157 Portfolios Princeton, Director Management, L.P. ("FAM")--Advised Funds NJ 08543-9011 since 1999; Chairman (Americas Region) of Age: 63 MLIM from 2000 to 2002; Executive Vice President of MLIM and FAM (which terms as used herein include their corporate predecessors) from 1983 to 2002; President of FAM Distributors, Inc. ("FAMD") from 1986 to 2002 and Director thereof from 1991 to 2002; Executive Vice President and Director of Princeton Services, Inc. ("Princeton Services") from 1993 to 2002; President of Princeton Administrators, L.P. from 1989 to 2002; Director of Financial Data Services, Inc. since 1985. * Mr. Glenn is a director, trustee or member of an advisory board of certain other investment companies for which MLIM or FAM acts as investment adviser. Mr. Glenn is an "interested person," as described in the Investment Company Act, of the Fund based on his present and former positions with MLIM, FAM, FAMD, Princeton Services and Princeton Administrators, L.P. The Director's term is unlimited. Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. As Fund President, Mr. Glenn serves at the pleasure of the Board of Directors.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Officers and Directors (unaudited)(continued)
Number of Portfolios in Other Public Position(s) Length of Fund Complex Directorships Held with Time Overseen by Held by Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years Director Director Independent Directors* Donald W. Burton Director 2002 to General Partner of The Burton Partnership, 23 Funds ITC DeltaCom, P.O. Box 9095 present Limited Partnership (an Investment 36 Portfolios Inc.; Symbion, Princeton, Partnership) since 1979; Managing General Inc. NJ 08543-9095 Partner of The South Atlantic Venture Age: 60 Funds since 1983; Member of the Investment AdvisoryCouncil of the Florida State Board of Administration since 2001. M. Colyer Crum Director 1997 to James R. Williston Professor of Investment 24 Funds Cambridge P.O. Box 9095 present Management Emeritus, Harvard Business 37 Portfolios Bancorp Princeton, School since 1996; James R. Williston NJ 08543-9095 Professor of Investment Management, Age: 72 Harvard Business School from 1971 to 1996; Director of Cambridge Bancorp. Laurie Simon Hodrick Director 1999 to Professor of Finance and Economics, 23 Funds None P.O. Box 9095 present Graduate School of Business, Columbia 36 Portfolios Princeton, University since 1998. NJ 08543-9095 Age: 41 David H. Walsh Director 2003 to Consultant with Putnam Investments from 23 Funds None P.O. Box 9095 present 1993 to 2003 and employed in various 36 Portfolios Princeton, capacities therewith from 1973 to 1992; NJ 08543-9095 Director, The National Audubon Society Age: 62 since 1980; Director, The American Museum of Fly Fishing since 1997. Fred G. Weiss Director 1998 to Managing Director of FGW Associates since 23 Funds Watson P.O. Box 9095 present 1997; Vice President, Planning Investment 36 Portfolios Pharmaceu- Princeton, and Development of Warner Lambert Co. ticals, Inc. NJ 08543-9095 from 1979 to 1997; Director of BTG Age: 63 International PLC (a global technology commercialization company) since 2001; Director of the Michael J. Fox Foundation for Parkinson's Research since 2000. * The Director's term is unlimited. Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72.
MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Officers and Directors (unaudited)(concluded)
Position(s) Length of Held with Time Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years Fund Officers* Donald C. Burke Vice 1997 to First Vice President of MLIM and FAM since 1997 and Treasurer thereof since P.O. Box 9011 President present 1999; Senior Vice President, Director and Treasurer of Princeton Services Princeton, and and since 1999; Vice President of FAMD since 1999; Director of MLIM Taxation NJ 08543-9011 Treasurer 1999 to since 1990. Age: 44 present Robert C. Doll, Jr. Senior 1999 to President of MLIM and member of the Executive Management Committee of P.O. Box 9011 Vice present ML & Co., Inc. since 2001; Global Chief Investment Officer and Senior Princeton, President Portfolio Manager of MLIM since 1999; Chief Investment Officer of Equities NJ 08543-9011 at Oppenheimer Funds, Inc. from 1990 to 1999 and Chief Investment Officer Age: 50 thereof from 1998 to 1999; Executive Vice President of Oppenheimer Funds, Inc. from 1991 to 1999. Lawrence R. Fuller Vice 1997 to Managing Director of MLIM since 2000; Director (Equities) of MLIM from 1997 P.O. Box 9011 President present to 2000. Princeton, NJ 08543-9011 Age: 63 Jeffrey Hiller Chief 2004 to Chief Compliance Officer of the MLIM/FAM-advised funds and First Vice P.O. Box 9011 Compliance present President and Chief Compliance Officer of MLIM since 2004; Global Director Princeton, Officer of Compliance at Morgan Stanley Investment Management from 2002 to 2004; NJ 08543-9011 Managing Director and Global Director of Compliance at Citigroup Asset Age: 53 Management from 2000 to 2002; Chief Compliance Officer at Soros Fund Management in 2000; Chief Compliance Officer at Prudential Financial from 1995 to 2000. Alice A. Pellegrino Secretary 2004 to Director (Legal Advisory) of MLIM since 2002; Vice President of MLIM from 1999 P.O. Box 9011 present to 2002; Attorney associated with MLIM since 1997. Princeton, NJ 08543-9011 Age: 44 * Officers of the Fund serve at the pleasure of the Board of Directors.
Further information about the Fund's Officers and Directors is available in the Fund's Statement of Additional Information, which can be obtained without charge by calling 1-800-MER-FUND. Custodian State Street Bank and Trust Company P.O. Box 351 Boston, MA 02101 Transfer Agent Financial Data Services, Inc. 4800 Deer Lake Drive East Jacksonville, FL 32246-6484 800-637-3863 MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Availability of Quarterly Schedule of Investments The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission ("SEC") for the first and third quarters of each fiscal year on Form N-Q. The Fund's Forms N-Q are available on the SEC's Web site at http://www.sec.gov. The Fund's Forms N-Q may also be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. Electronic Delivery The Fund offers electronic delivery of communications to its shareholders. In order to receive this service, you must register your account and provide us with e-mail information. To sign up for this service, simply access this Web site http://www.icsdelivery.com/live and follow the instructions. When you visit this site, you will obtain a personal identification number (PIN). You will need this PIN should you wish to update your e-mail address, choose to discontinue this service and/or make any other changes to the service. This service is not available for certain retirement accounts at this time. MERRILL LYNCH GLOBAL GROWTH FUND, INC., AUGUST 31, 2004 Item 2 - Code of Ethics - The registrant has adopted a code of ethics, as of the end of the period covered by this report, that applies to the registrant's principal executive officer, principal financial officer and principal accounting officer, or persons performing similar functions. A copy of the code of ethics is available without charge upon request by calling toll-free 1-800-MER-FUND (1-800-637-3863). Item 3 - Audit Committee Financial Expert - The registrant's board of directors has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent: (1) Donald W. Burton, (2) M. Colyer Crum, (3) Laurie Simon Hodrick, (4) David H. Walsh and (5) Fred G. Weiss. The registrant's board of directors has determined that Laurie Simon Hodrick and M. Colyer Crum qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR. Ms. Hodrick has a thorough understanding of generally accepted accounting principals, financial statements, and internal controls and procedures for financial reporting. Ms. Hodrick earned a Ph.D. in economics and has taught courses in finance for over 15 years. Her M.B.A.-level course centers around the evaluation and analysis of firms' corporate financial statements. She has also taught in financial analysts' training programs. Ms. Hodrick has also worked with several prominent corporations in connection with the analysis of financial forecasts and projections and analysis of the financial statements of those companies, serving on the Financial Advisory Council of one of these major corporations. She has also served as the Treasurer and Finance Chair of a 501(c)(3) organization. Ms. Hodrick has published a number of articles in leading economic and financial journals and is the associate editor of two leading finance journals. M. Colyer Crum also possesses a thorough understanding of generally accepted accounting principals, financial statements, and internal controls and procedures for financial reporting through a combination of education and experience. Professor Crum was a professor of investment management at the Harvard Business School for 25 years. The courses taught by Professor Crum place a heavy emphasis on the analysis of underlying company financial statements with respect to stock selection and the analysis of credit risk in making loans. Professor Crum has also served on a number of boards of directors and has served on the audit committees, and in some cases chaired the audit committee, for several major corporations and financial institutions. For two such organizations, Professor Crum has performed extensive investment analysis of financial statements in connection with investment management decisions. From these experiences, he has gained significant experience with the establishment of reserves and accounting policies, differences between U.S. GAAP and Canadian GAAP and executive compensation issues. Item 4 - Principal Accountant Fees and Services (a) Audit Fees - Fiscal Year Ending August 31, 2004 - $38,000 Fiscal Year Ending August 31, 2003 - $41,500 (b) Audit-Related Fees - Fiscal Year Ending August 31, 2004 - $0 Fiscal Year Ending August 31, 2003 - $0 (c) Tax Fees - Fiscal Year Ending August 31, 2004 - $5,200 Fiscal Year Ending August 31, 2003 - $5,000 The nature of the services include tax compliance, tax advice and tax planning. (d) All Other Fees - Fiscal Year Ending August 31, 2004 - $0 Fiscal Year Ending August 31, 2003 - $0 (e)(1) The registrant's audit committee (the "Committee") has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the registrant's affiliated service providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are a) consistent with the SEC's auditor independence rules and b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis ("general pre-approval"). However, such services will only be deemed pre-approved provided that any individual project does not exceed $5,000 attributable to the registrant or $50,000 for all of the registrants the Committee oversees. Any proposed services exceeding the pre-approved cost levels will require specific pre- approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved subject to general pre-approval at the next regularly scheduled in-person board meeting. (e)(2) 0% (f) Not Applicable (g) Fiscal Year Ending August 31, 2004 - $5,200 Fiscal Year Ending August 31, 2003 - $5,000 (h) The registrant's audit committee has considered and determined that the provision of non-audit services that were rendered to the registrant's investment adviser and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre- approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence. Regulation S-X Rule 2-01(c)(7)(ii) - $945,000, 0% Item 5 - Audit Committee of Listed Registrants - Not Applicable Item 6 - Schedule of Investments - Not Applicable Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies - Not Applicable Item 8 - Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers - Not Applicable Item 9 - Submission of Matters to a Vote of Security Holders - Not Applicable Item 10 - Controls and Procedures 10(a) - The registrant's certifying officers have reasonably designed such disclosure controls and procedures to ensure material information relating to the registrant is made known to us by others particularly during the period in which this report is being prepared. The registrant's certifying officers have determined that the registrant's disclosure controls and procedures are effective based on our evaluation of these controls and procedures as of a date within 90 days prior to the filing date of this report. 10(b) - There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal half- year of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 11 - Exhibits attached hereto 11(a)(1) - Code of Ethics - See Item 2 11(a)(2) - Certifications - Attached hereto 11(a)(3) - Not Applicable 11(b) - Certifications - Attached hereto Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Merrill Lynch Global Growth Fund, Inc. By: _/s/ Terry K. Glenn_______ Terry K. Glenn, President of Merrill Lynch Global Growth Fund, Inc. Date: October 18, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: _/s/ Terry K. Glenn________ Terry K. Glenn, President of Merrill Lynch Global Growth Fund, Inc. Date: October 18, 2004 By: _/s/ Donald C. Burke________ Donald C. Burke, Chief Financial Officer of Merrill Lynch Global Growth Fund, Inc. Date: October 18, 2004