-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Nhio+8ONRll0wRFlzlRuVhaZmRQL9hDTQvVeGuf+1dgLr2eQXFHxF22TLHc2aSG7 CWK3L5ZiEntmFM6XFon3zQ== 0000820027-02-000237.txt : 20020415 0000820027-02-000237.hdr.sgml : 20020415 ACCESSION NUMBER: 0000820027-02-000237 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020131 FILED AS OF DATE: 20020404 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AXP NEW DIMENSIONS FUND INC /MN/ CENTRAL INDEX KEY: 0000049717 IRS NUMBER: 410940846 STATE OF INCORPORATION: MN FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-01629 FILM NUMBER: 02601762 BUSINESS ADDRESS: STREET 1: 80 SOUTH 8TH STREET STREET 2: T33/52 CITY: MINNEAPOLIS STATE: MN ZIP: 55440 BUSINESS PHONE: 6123722772 FORMER COMPANY: FORMER CONFORMED NAME: IDS NEW DIMENSIONS FUND INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: AXP NEW DIMENSIONS FUND INC/ DATE OF NAME CHANGE: 20000404 N-30D 1 s6015c.txt AXP GROWTH DIMENSIONS FUND AXP(R) Growth Dimensions Fund 2002 SEMIANNUAL REPORT American Express Funds (icon of ruler) AXP Growth Dimensions Fund seeks to provide shareholders with long-term capital growth. Profit Power Rising stock prices often go hand-in-hand with rising profits. AXP Growth Dimensions Fund tries to identify companies with above-average profit potential and the staying power to provide long-term capital appreciation. CONTENTS From the Chairman........................3 Portfolio Managers' Q & A................3 Fund Facts...............................6 The 10 Largest Holdings..................7 Financial Statements.....................8 Notes to Financial Statements...........11 Investments in Securities...............19 - -------------------------------------------------------------------------------- 2 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT (picture of Arne H. Carlson) Arne H. Carlson Chairman of the board From the Chairman For most of us investors, the past several months proved to be an extremely trying time. More recently, the events of this past September and the prospect of what may follow have added to our collective concern. While nothing can change what has happened, we can control how we respond. In broad terms, I would strongly advise that you keep a focus on your long-term financial goals and not let specific events dictate your investment decisions. Ultimately, it is where you finish, not where you are at the moment, that matters most. Your financial advisor plays an essential role in this process, so please let him or her help you by reviewing your situation and plotting the proper investment course. As I have indicated in the past, the role our Board plays in your financial future is to monitor and confirm that each American Express mutual fund meets its investment objective and that its management style stays on target. We want each fund to be able to deliver to you, the shareholder, the type of performance you expect and the best results that can be obtained. Toward that end, American Express has made significant changes in its investment management capability, and will continue to make changes as it strives to provide a consistent standard of excellence. On behalf of the Board, Arne H. Carlson (picture of Anne Obermeyer) Anne Obermeyer Portfolio manager Portfolio Managers' Q & A Q: How did the Fund perform over the six months ended January 31, 2002? A: During a difficult six-month period for the stock market, the Fund registered a decline of 7.64% (return for Class A shares excluding sales charges). By comparison, the Standard & Poor's 500 Index and the Lipper Large-Cap Growth Funds Index returned -6.04% and -7.22%, respectively, for the six months. - -------------------------------------------------------------------------------- 3 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT (picture of Doug Guffy) Doug Guffy Portfolio manager (picture of Gordon M. Fines) Gordon M. Fines Senior portfolio manager* Q: What were the key factors that contributed to the Fund's performance during that time frame? A: The period started in the midst of a difficult environment for growth stocks, the focus of this Fund. The U.S. economy was in the midst of what later was defined as a recession, and growth companies were having a difficult time meeting profit expectations. This was reflected in a steady decline in stock values. The events of September 11 exacerbated the situation, and in the days following it, the market reached its low point for the year. However, investor psychology changed dramatically after that. The Fund enjoyed a solid return in the last three months of 2001, as the market again looked to growth stocks for opportunity. The period ended with a minor setback in the market in January 2002, as issues surrounding the collapse of Enron overshadowed what appeared to be encouraging news on the direction of the U.S. economy. Many of our top-performing stocks during the period included technology names such as Intel, Maxim Integrated Products and Xilinx. Retail stocks such as Kohl's, Target, Wal-Mart Stores and Family Dollar Stores also enjoyed solid returns. Q: What changes did you make to the portfolio during the past six months? A: We began boosting the Fund's position in stocks that could benefit from a cyclical upturn in the economy, notably in the technology, industrial and consumer retail sectors. That took place starting in August 2001, a time when many of these stocks were available at very attractive prices. This move proved beneficial for the Fund, as many stocks we added enjoyed a solid recovery in the final months of the year. We are particularly optimistic about prospects for the technology segment of the market, especially semiconductor equipment, storage and to a certain extent, computer hardware stocks. We also have boosted the Fund's exposure to health care stocks. While this is not typically considered an economically-sensitive area of the market, we feel there are solid growth prospects among selected stocks in the medical device and biotechnology areas. By contrast, we are maintaining a reduced position in areas of the market we expect will continue to struggle, including energy, consumer staples and telecommunication services stocks. - -------------------------------------------------------------------------------- 4 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Q: What is your outlook for the next six months? A: We anticipate an improved economic environment, which should play into the Fund's strengths in the coming months. The economically-sensitive stocks that we own are likely to respond positively if the economic recovery develops. While we are focused on growth stocks, our emphasis has been on companies that are somewhat conservative in nature and that have proven earnings capabilities and strong balance sheets. The Fund is fully invested, seeking to take advantage of what we expect to be a better market ahead. While the Enron situation has put a cloud over the market that could take some time to clear up, the market could eventually benefit from the problems that have resulted. We can expect more clear, conservative financial statements from companies in the future that are likely to restore credibility in the minds of investors. In summary, we're encouraged that the market will be on more solid ground as the year progresses. Anne Obermeyer Doug Guffy Gordon M. Fines * Gordon Fines assists with the management of the Fund. - -------------------------------------------------------------------------------- 5 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Fund Facts Class A -- 6-month performance (All figures per share) Net asset value (NAV) Jan. 31, 2002 $2.54 July 31, 2001 $2.75 Decrease $0.21 Distributions -- Aug. 1, 2001 - Jan. 31, 2002 From income $ -- From long-term capital gains $ -- Total distributions $ -- Total return* -7.64% Class B -- 6-month performance (All figures per share) Net asset value (NAV) Jan. 31, 2002 $2.51 July 31, 2001 $2.73 Decrease $0.22 Distributions -- Aug. 1, 2001 - Jan. 31, 2002 From income $ -- From long-term capital gains $ -- Total distributions $ -- Total return* -8.06% Class C -- 6-month performance (All figures per share) Net asset value (NAV) Jan. 31, 2002 $2.51 July 31, 2001 $2.73 Decrease $0.22 Distributions -- Aug. 1, 2001 - Jan. 31, 2002 From income $ -- From long-term capital gains $ -- Total distributions $ -- Total return* -8.06% Class Y -- 6-month performance (All figures per share) Net asset value (NAV) Jan. 31, 2002 $2.55 July 31, 2001 $2.76 Decrease $0.21 Distributions-- Aug. 1, 2001 - Jan. 31, 2002 From income $ -- From long-term capital gains $ -- Total distributions $ -- Total return* -7.61% * The total return is a hypothetical investment in the Fund with all distributions reinvested. Returns do not include sales load. The prospectus discusses the effect of sales charges, if any, on the various classes. - -------------------------------------------------------------------------------- 6 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT The 10 Largest Holdings Percent Value (of net assets) (as of Jan. 31, 2002) Medtronic 4.6% $14,288,300 Cisco Systems 3.9 12,263,600 General Electric 3.5 10,773,500 Citigroup 3.3 10,428,000 American Intl Group 3.1 9,639,500 Wal-Mart Stores 3.1 9,596,800 Microsoft 3.1 9,556,500 Pfizer 2.8 8,750,700 Intel 2.7 8,409,600 Fifth Third Bancorp 2.2 6,957,500 For further detail about these holdings, please refer to the section entitled "Investments in Securities." (icon of pie chart) The 10 holdings listed here make up 32.3% of net assets - -------------------------------------------------------------------------------- 7 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Financial Statements
Statement of assets and liabilities AXP Growth Dimensions Fund Jan. 31, 2002 (Unaudited) Assets Investments in securities, at value (Note 1) (identified cost $351,694,468) $ 309,771,518 Cash in bank on demand deposit 233 Dividends and accrued interest receivable 110,567 Receivable for investment securities sold 3,674,056 Other prepaid assets 383,323 ------- Total assets 313,939,697 ----------- Liabilities Capital shares payable 1,500 Payable for investment securities purchased 2,337,244 Accrued investment management services fee 4,234 Accrued distribution fee 4,181 Accrued transfer agency fee 1,435 Accrued administrative services fee 254 Other accrued expenses 105,666 ------- Total liabilities 2,454,514 --------- Net assets applicable to outstanding capital stock $ 311,485,183 ============= Represented by Capital stock -- $.01 par value (Note 1) $ 1,231,012 Additional paid-in capital 513,972,821 Net operating loss (770,679) Accumulated net realized gain (loss) (Note 5) (161,025,021) Unrealized appreciation (depreciation) on investments (41,922,950) ----------- Total -- representing net assets applicable to outstanding capital stock $ 311,485,183 ============= Net assets applicable to outstanding shares: Class A $ 206,306,039 Class B $ 99,510,340 Class C $ 5,637,502 Class Y $ 31,302 Net asset value per share of outstanding capital stock: Class A shares 81,198,943 $ 2.54 Class B shares 39,644,272 $ 2.51 Class C shares 2,245,657 $ 2.51 Class Y shares 12,296 $ 2.55 ------ -------------
See accompanying notes to financial statements. - -------------------------------------------------------------------------------- 8 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT
Statement of operations AXP Growth Dimensions Fund Six months ended Jan. 31, 2002 (Unaudited) Investment income Income: Dividends $ 1,109,950 Interest 266,102 Less foreign taxes withheld (4,072) ------ Total income 1,371,980 --------- Expenses (Note 2): Investment management services fee 682,917 Distribution fee Class A 260,163 Class B 491,872 Class C 27,492 Transfer agency fee 388,146 Incremental transfer agency fee Class A 28,034 Class B 24,218 Class C 1,811 Service fee -- Class Y 17 Administrative services fees and expenses 48,774 Compensation of board members 5,743 Custodian fees 25,725 Printing and postage 61,079 Registration fees 245,787 Audit fees 7,125 Other 4,885 ----- Total expenses 2,303,788 Expenses reimbursed by AEFC (Note 2) (155,357) -------- 2,148,431 Earnings credits on cash balances (Note 2) (5,772) ------ Total net expenses 2,142,659 --------- Investment income (loss) -- net (770,679) -------- Realized and unrealized gain (loss) -- net Net realized gain (loss) on security transactions (Note 3) (56,852,949) Net change in unrealized appreciation (depreciation) on investments 29,975,540 ---------- Net gain (loss) on investments (26,877,409) ----------- Net increase (decrease) in net assets resulting from operations $(27,648,088) ============
See accompanying notes to financial statements. - -------------------------------------------------------------------------------- 9 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT
Statements of changes in net assets AXP Growth Dimensions Fund Jan. 31, 2002 July 31, 2001 Six months ended Year ended (Unaudited) Operations and distributions Investment income (loss) -- net $ (770,679) $ (1,178,432) Net realized gain (loss) on investments (56,852,949) (104,093,286) Net change in unrealized appreciation (depreciation) on investments 29,975,540 (70,556,768) ---------- ----------- Net increase (decrease) in net assets resulting from operations (27,648,088) (175,828,486) ----------- ------------ Distributions to shareholders from: Net investment income Class A -- (15,831) Class Y -- (1) --- -- Total distributions -- (15,832) --- ------- Capital share transactions (Note 4) Proceeds from sales Class A shares (Note 2) 44,454,849 391,327,318 Class B shares 20,703,188 181,122,125 Class C shares 1,176,533 9,103,911 Class Y shares 5 97,543 Reinvestment of distributions at net asset value Class A shares -- 15,759 Payments for redemptions Class A shares (52,131,415) (64,849,858) Class B shares (Note 2) (20,939,568) (27,010,710) Class C shares (Note 2) (960,275) (1,044,602) Class Y shares (7,089) (30,799) ------ ------- Increase (decrease) in net assets from capital share transactions (7,703,772) 488,730,687 ---------- ----------- Total increase (decrease) in net assets (35,351,860) 312,886,369 Net assets at beginning of period 346,837,043 33,950,674 ----------- ---------- Net assets at end of period $311,485,183 $ 346,837,043 ============ =============
See accompanying notes to financial statements. - -------------------------------------------------------------------------------- 10 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Notes to Financial Statements AXP Growth Dimensions Fund (Unaudited as to Jan. 31, 2002) 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Fund is a series of AXP New Dimensions Fund, Inc. and is registered under the Investment Company Act of 1940 (as amended) as a diversified, open-end management investment company. AXP New Dimensions Fund, Inc. has 10 billion authorized shares of capital stock that can be allocated among the separate series as designated by the board. The Fund invests primarily in equity securities showing potential for significant growth. The Fund offers Class A, Class B, Class C and Class Y shares. o Class A shares are sold with a front-end sales charge. o Class B shares may be subject to a contingent deferred sales charge (CDSC) and automatically convert to Class A shares during the ninth calendar year of ownership. o Class C shares may be subject to a CDSC. o Class Y shares have no sales charge and are offered only to qualifying institutional investors. All classes of shares have identical voting, dividend and liquidation rights. The distribution fee, incremental transfer agency fee and service fee (class specific expenses) differ among classes. Income, expenses (other than class specific expenses) and realized and unrealized gains or losses on investments are allocated to each class of shares based upon its relative net assets. The Fund's significant accounting policies are summarized below: Use of estimates Preparing financial statements that conform to accounting principles generally accepted in the United States of America requires management to make estimates (e.g., on assets, liabilities and contingent assets and liabilities) that could differ from actual results. Valuation of securities All securities are valued at the close of each business day. Securities traded on national securities exchanges or included in national market systems are valued at the last quoted sales price. Debt securities are generally traded in the over-the-counter market and are valued at a price that reflects fair value as quoted by dealers in these securities or by an independent pricing service. Securities for which market quotations are not readily available are valued at fair value according to methods selected in good faith by the board. Short-term securities maturing in more than 60 days from the valuation date are valued at the market price or approximate market value based on current interest rates; those maturing in 60 days or less are valued at amortized cost. Option transactions To produce incremental earnings, protect gains, and facilitate buying and selling of securities for investments, the Fund may buy and write options traded on any U.S. or foreign exchange or in the over-the-counter market where completing the obligation depends upon the credit standing of the other party. The Fund also may buy and sell put and call options and write covered call options on portfolio securities as well as write cash-secured put options. The risk in writing a call option is that the Fund gives up the opportunity for profit if the market price of the security increases. The risk in writing a put option is that the Fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an - -------------------------------------------------------------------------------- 11 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT option is that the Fund pays a premium whether or not the option is exercised. The Fund also has the additional risk of being unable to enter into a closing transaction if a liquid secondary market does not exist. Option contracts are valued daily at the closing prices on their primary exchanges and unrealized appreciation or depreciation is recorded. The Fund will realize a gain or loss when the option transaction expires or closes. When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option or the cost of a security for a purchased put or call option is adjusted by the amount of premium received or paid. Futures transactions To gain exposure to or protect itself from market changes, the Fund may buy and sell financial futures contracts traded on any U.S. or foreign exchange. The Fund also may buy and write put and call options on these futures contracts. Risks of entering into futures contracts and related options include the possibility of an illiquid market and that a change in the value of the contract or option may not correlate with changes in the value of the underlying securities. Upon entering into a futures contract, the Fund is required to deposit either cash or securities in an amount (initial margin) equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the Fund each day. The variation margin payments are equal to the daily changes in the contract value and are recorded as unrealized gains and losses. The Fund recognizes a realized gain or loss when the contract is closed or expires. Foreign currency translations and foreign currency contracts Securities and other assets and liabilities denominated in foreign currencies are translated daily into U.S. dollars. Foreign currency amounts related to the purchase or sale of securities and income and expenses are translated at the exchange rate on the transaction date. The effect of changes in foreign exchange rates on realized and unrealized security gains or losses is reflected as a component of such gains or losses. In the statement of operations, net realized gains or losses from foreign currency transactions, if any, may arise from sales of foreign currency, closed forward contracts, exchange gains or losses realized between the trade date and settlement date on securities transactions, and other translation gains or losses on dividends, interest income and foreign withholding taxes. The Fund may enter into forward foreign currency exchange contracts for operational purposes and to protect against adverse exchange rate fluctuation. The net U.S. dollar value of foreign currency underlying all contractual commitments held by the Fund and the resulting unrealized appreciation or depreciation are determined using foreign currency exchange rates from an independent pricing service. The Fund is subject to the credit risk that the other party will not complete its contract obligations. Federal taxes The Fund's policy is to comply with all sections of the Internal Revenue Code that apply to regulated investment companies and to distribute substantially all of its taxable income to shareholders. No provision for income or excise taxes is thus required. - -------------------------------------------------------------------------------- 12 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of deferred losses on certain futures contracts, the recognition of certain foreign currency gains (losses) as ordinary income (loss) for tax purposes, and losses deferred due to "wash sale" transactions. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. Also, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the Fund. Dividends to shareholders An annual dividend from net investment income, declared and paid at the end of the calendar year, when available, is reinvested in additional shares of the Fund at net asset value or payable in cash. Capital gains, when available, are distributed along with the income dividend. Other Security transactions are accounted for on the date securities are purchased or sold. Dividend income is recognized on the ex-dividend date and interest income, including level-yield amortization of premium and discount, is accrued daily. 2. EXPENSES AND SALES CHARGES The Fund has agreements with American Express Financial Corporation (AEFC) to manage its portfolio and provide administrative services. Under an Investment Management Services Agreement, AEFC determines which securities will be purchased, held or sold. The management fee is a percentage of the Fund's average daily net assets in reducing percentages from 0.60% to 0.48% annually based on the combined net assets of the Fund and AXP New Dimensions Fund. The fee may be adjusted upward or downward by a performance incentive adjustment based on a comparison of the performance of Class A shares of the Fund to the Lipper Large-Cap Growth Funds Index. The maximum adjustment is 0.12% of the Fund's average daily net assets after deducting 1% from the performance difference. If the performance difference is less than 1% the adjustment will be zero. The adjustment decreased the fee by $111,247 for the six months ended Jan. 31, 2002. Under an Administrative Services Agreement, the Fund pays AEFC a fee for administration and accounting services at a percentage of the Fund's average daily net assets in reducing percentages from 0.05% to 0.02% annually. A minor portion of additional administrative service expenses paid by the Fund are consultants' fees and fund office expenses. Under this agreement, the Fund also pays taxes, audit and certain legal fees, registration fees for shares, compensation of board members, corporate filing fees and any other expenses properly payable by the Fund and approved by the board. Under a separate Transfer Agency Agreement, American Express Client Service Corporation (AECSC) maintains shareholder accounts and records. The incremental transfer agency fee is the amount charged to the specific classes for the additional expense above the fee for Class Y. The Fund pays AECSC an annual fee per shareholder account for this service as follows: o Class A $19.00 o Class B $20.00 o Class C $19.50 o Class Y $17.00 - -------------------------------------------------------------------------------- 13 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT The Fund has agreements with American Express Financial Advisors Inc. (the Distributor) for distribution and shareholder services. Under a Plan and Agreement of Distribution, the Fund pays a distribution fee at an annual rate up to 0.25% of the Fund's average daily net assets attributable to Class A shares and up to 1.00% for Class B and Class C shares. Under a Shareholder Service Agreement, the Fund pays the Distributor a fee for service provided to shareholders by financial advisors and other servicing agents. The fee is calculated at a rate of 0.10% of the Fund's average daily net assets attributable to Class Y shares. Sales charges received by the Distributor for distributing Fund shares were $434,398 for Class A, $93,277 for Class B and $1,659 for Class C for the six months ended Jan. 31, 2002. AEFC and American Express Financial Advisors Inc. agreed to waive certain fees and to absorb certain expenses until July 31, 2002. Under this agreement, total expenses will not exceed 1.15% for Class A, 1.91% for Class B, 1.91% for Class C and 0.99% for Class Y. In addition, for the six months ended Jan. 31, 2002, AEFC and American Express Financial Advisors Inc. further voluntarily agreed to waive certain fees and expenses to 1.12% for Class A, 1.89% for Class B, and 0.94% for Class Y. During the six months ended Jan. 31, 2002, the Fund's custodian and transfer agency fees were reduced by $5,772 as a result of earnings credits from overnight cash balances. The Fund also pays custodian fees to American Express Trust Company, an affiliate of AEFC. 3. SECURITIES TRANSACTIONS Cost of purchases and proceeds from sales of securities (other than short-term obligations) aggregated $99,068,103 and $100,481,697, respectively, for the six months ended Jan. 31, 2002. Realized gains and losses are determined on an identified cost basis. Brokerage commissions paid to brokers affiliated with AEFC were $18,152 for the six months ended Jan. 31, 2002. Income from securities lending amounted to $1,780 for the six months ended Jan. 31, 2002. The risks to the Fund of securities lending are that the borrower may not provide additional collateral when required or return the securities when due. - -------------------------------------------------------------------------------- 14 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT 4. CAPITAL SHARE TRANSACTIONS Transactions in shares of capital stock for the periods indicated are as follows:
Six months ended Jan. 31, 2002 Class A Class B Class C Class Y Sold 17,672,305 8,327,884 475,847 -- Issued for reinvested distributions -- -- -- -- Redeemed (20,826,689) (8,488,737) (388,702) (2,813) ----------- ---------- -------- ------ Net increase (decrease) (3,154,384) (160,853) 87,145 (2,813) ---------- -------- ------ ------ Year ended July 31, 2001 Class A Class B Class C Class Y Sold 100,323,533 46,329,228 2,304,048 22,229 Issued for reinvested distributions 4,529 -- -- -- Redeemed (20,463,920) (8,824,909) (321,927) (8,116) ----------- ---------- -------- ------ Net increase (decrease) 79,864,142 37,504,319 1,982,121 14,113 ---------- ---------- --------- ------
5. CAPITAL LOSS CARRY-OVER For federal income tax purposes, the Fund has a capital loss carry-over of $101,605,932 as of July 31, 2001, that if not offset by subsequent capital gains, will expire in 2008 through 2010. It is unlikely the board will authorize a distribution of any net realized capital gains until the available capital loss carry-over has been offset or expires. 6. BANK BORROWINGS The Fund has a revolving credit agreement with U.S. Bank, N.A., whereby the Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The Fund must have asset coverage for borrowings not to exceed the aggregate of 333% of advances equal to or less than five business days plus 367% of advances over five business days. The agreement, which enables the Fund to participate with other American Express mutual funds, permits borrowings up to $200 million, collectively. Interest is charged to each Fund based on its borrowings at a rate equal to the Federal Funds Rate plus 0.30% or the Eurodollar Rate (Reserve Adjusted) plus 0.20%. Borrowings are payable up to 90 days after such loan is executed. The Fund also pays a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.05% per annum. The Fund had no borrowings outstanding during the six months ended Jan. 31, 2002. - -------------------------------------------------------------------------------- 15 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT 7. FINANCIAL HIGHLIGHTS The tables below show certain important financial information for evaluating the Fund's results.
Class A Per share income and capital changes(a) Fiscal period ended July 31, 2002(j) 2001 2000(b) Net asset value, beginning of period $2.75 $ 4.87 $4.92 ----- ------ ----- Income from investment operations: Net investment income (loss) -- (.01) -- Net gains (losses) (both realized and unrealized) (.21) (2.11) (.05) ---- ----- ---- Total from investment operations (.21) (2.12) (.05) ---- ----- ---- Net asset value, end of period $2.54 $ 2.75 $4.87 ----- ------ ----- Ratios/supplemental data Net assets, end of period (in millions) $206 $232 $22 ---- ---- --- Ratio of expenses to average daily net assets(c) 1.12%(d,h) 1.12%(d) 1.10%(d,h) ---- ---- ---- Ratio of net investment income (loss) to average daily net assets (.24%)(h) (.16%) .37%(h) ---- ---- --- Portfolio turnover rate (excluding short-term securities) 34% 67% 2% -- -- - Total return(i) (7.64%) (43.53%) (1.02%) ----- ------ ----- Class B Per share income and capital changes(a) Fiscal period ended July 31, 2002(j) 2001 2000(b) Net asset value, beginning of period $2.73 $ 4.87 $4.92 ----- ------ ----- Income from investment operations: Net investment income (loss) (.01) (.02) -- Net gains (losses) (both realized and unrealized) (.21) (2.12) (.05) ---- ----- ---- Total from investment operations (.22) (2.14) (.05) ---- ----- ---- Net asset value, end of period $2.51 $ 2.73 $4.87 ----- ------ ----- Ratios/supplemental data Net assets, end of period (in millions) $100 $109 $11 ---- ---- --- Ratio of expenses to average daily net assets(c) 1.89%(e,h) 1.89%(e) 1.91%(e,h) ---- ---- ---- Ratio of net investment income (loss) to average daily net assets (1.01%)(h) (.92%) (.48%)(h) ----- ---- ---- Portfolio turnover rate (excluding short-term securities) 34% 67% 2% -- -- - Total return(i) (8.06%) (43.94%) (1.02%) ----- ------ -----
See accompanying notes to financial highlights. - -------------------------------------------------------------------------------- 16 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT
Class C Per share income and capital changes(a) Fiscal period ended July 31, 2002(j) 2001 2000(b) Net asset value, beginning of period $2.73 $ 4.87 $4.92 ----- ------ ----- Income from investment operations: Net investment income (loss) (.01) (.02) -- Net gains (losses) (both realized and unrealized) (.21) (2.12) (.05) ---- ----- ---- Total from investment operations (.22) (2.14) (.05) ---- ----- ---- Net asset value, end of period $2.51 $ 2.73 $4.87 ----- ------ ----- Ratios/supplemental data Net assets, end of period (in millions) $6 $6 $1 -- -- -- Ratio of expenses to average daily net assets(c) 1.91%(f,h) 1.89%(f) 1.91%(f,h) ---- ---- ---- Ratio of net investment income (loss) to average daily net assets (1.03%)(h) (.94%) (.48%)(h) ----- ---- ---- Portfolio turnover rate (excluding short-term securities) 34% 67% 2% -- -- - Total return(i) (8.06%) (43.94%) (1.02%) ----- ------ ----- Class Y Per share income and capital changes(a) Fiscal period ended July 31, 2002(j) 2001 2000(b) Net asset value, beginning of period $2.76 $ 4.88 $4.92 ----- ------ ----- Income from investment operations: Net gains (losses) (both realized and unrealized) (.21) (2.12) (.04) ---- ----- ---- Net asset value, end of period $2.55 $ 2.76 $4.88 ----- ------ ----- Ratios/supplemental data Net assets, end of period (in millions) $-- $-- $-- --- --- --- Ratio of expenses to average daily net assets(c) .94%(g,h) .95%(g) .81%(g,h) --- --- --- Ratio of net investment income (loss) to average daily net assets (.05%)(h) (.03%) .58%(h) ---- ---- --- Portfolio turnover rate (excluding short-term securities) 34% 67% 2% -- -- - Total return(i) (7.61%) (43.44%) (.81%) ----- ------ ----
See accompanying notes to financial highlights. - -------------------------------------------------------------------------------- 17 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Notes to financial highlights (a) For a share outstanding throughout the period. Rounded to the nearest cent. (b) For the period from June 26, 2000 (when shares became publicly available) to July 31, 2000. (c) Expense ratio is based on total expenses of the Fund before reduction of earnings credits on cash balances. (d) AEFC reimbursed the Fund for certain expenses. Had AEFC not done so, the annual ratios of expenses for Class A would have been 1.22%, 1.16% and 2.32% for the periods ended 2002, 2001 and 2000, respectively. (e) AEFC reimbursed the Fund for certain expenses. Had AEFC not done so, the annual ratios of expenses for Class B would have been 1.99%, 1.92% and 3.40% for the periods ended 2002, 2001 and 2000, respectively. (f) AEFC reimbursed the Fund for certain expenses. Had AEFC not done so, the annual ratios of expenses for Class C would have been 2.01%, 1.92% and 3.40% for the periods ended 2002, 2001 and 2000, respectively. (g) AEFC reimbursed the Fund for certain expenses. Had AEFC not done so, the annual ratios of expenses for Class Y would have been 1.03%, 1.00% and 2.12% for the periods ended 2002, 2001 and 2000, respectively. (h) Adjusted to an annual basis. (i) Total return does not reflect payment of a sales charge. (j) Six months ended Jan. 31, 2001 (Unaudited). - -------------------------------------------------------------------------------- 18 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Investments in Securities AXP Growth Dimensions Fund Jan. 31, 2002 (Unaudited) (Percentages represent value of investments compared to net assets) Common stocks (94.9%) Issuer Shares Value(a) Banks and savings & loans (4.0%) Bank of America 20,000 $1,260,600 Fifth Third Bancorp 110,000 6,957,500 U.S. Bancorp 200,000 4,164,000 Total 12,382,100 Beverages & tobacco (1.0%) Coca-Cola 70,000 3,062,500 Chemicals (0.2%) Praxair 9,000 522,450 Communications equipment & services (4.2%) Brocade Communications Systems 150,000(b) 5,460,000 Nokia ADR Cl A 170,000(c) 3,986,500 Verizon Communications 80,000 3,708,000 Total 13,154,500 Computer software & services (3.4%) Electronic Arts 50,000(b) 2,653,500 Intuit 70,000(b) 2,747,500 PeopleSoft 30,000(b) 974,700 VERITAS Software 100,000(b) 4,255,000 Total 10,630,700 Computers & office equipment (11.4%) Cisco Systems 620,000(b) 12,263,600 Comverse Technology 80,000(b) 1,709,600 Dell Computer 90,000(b) 2,470,500 Intl Business Machines 40,000 4,315,600 Microsoft 150,000(b) 9,556,500 Oracle 210,000(b) 3,624,600 Sun Microsystems 150,000(b) 1,614,000 Total 35,554,400 Electronics (11.0%) Applied Materials 70,000(b) 3,055,500 Broadcom Cl A 50,000(b) 2,123,500 Flextronics Intl 40,000(b,c) 888,000 Intel 240,000 8,409,600 Jabil Circuit 120,000(b) 2,784,000 KLA-Tencor 70,000(b) 4,009,600 Maxim Integrated Products 80,000(b) 4,439,200 Texas Instruments 160,000 4,993,600 Xilinx 80,000(b) 3,468,000 Total 34,171,000 Energy (2.0%) Conoco 110,000 3,097,600 Kerr-McGee 60,000 3,177,000 Total 6,274,600 Financial services (6.1%) Citigroup 220,000 10,428,000 Lehman Brothers Holdings 30,000 1,943,100 Merrill Lynch 45,000 2,294,100 Paychex 70,000 2,569,000 Schwab (Charles) 130,000 1,868,100 Total 19,102,300 Food (0.6%) General Mills 40,000 1,982,000 Health care (17.0%) Amgen 60,000(b) 3,330,000 Baxter Intl 60,000 3,349,800 Biomet 120,000 3,874,800 Genentech 90,000(b) 4,450,500 Invitrogen 90,000(b) 4,847,400 Johnson & Johnson 50,000 2,875,500 Laboratory Corp America Holdings 40,000(b) 3,256,000 MedImmune 50,000(b) 2,118,500 Medtronic 290,000 14,288,300 Pfizer 210,000 8,750,700 Pharmacia 50,000 2,025,000 Total 53,166,500 Health care services (1.5%) AmerisourceBergen 70,000 4,531,100 Household products (1.0%) Gillette 90,000 2,997,000 Insurance (5.1%) ACE 110,000(c) 4,273,500 American Intl Group 130,000 9,639,500 Everest Re Group 30,000(c) 2,061,000 Total 15,974,000 Leisure time & entertainment (3.2%) Harley-Davidson 65,000 3,705,000 Viacom Cl B 155,000(b) 6,198,450 Total 9,903,450 See accompanying notes to investments in securities. - -------------------------------------------------------------------------------- 19 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Common stocks (continued) Issuer Shares Value(a) Media (3.8%) AOL Time Warner 180,000(b) $4,735,800 Clear Channel Communications 70,000(b) 3,222,800 USA Networks 140,000(b) 4,002,600 Total 11,961,200 Metals (1.1%) Alcan 90,000(c) 3,497,400 Multi-industry conglomerates (7.4%) General Electric 290,000 10,773,500 Minnesota Mining & Mfg 45,000 4,986,000 Robert Half Intl 165,000(b) 4,326,300 Symyx Technologies 130,000(b) 2,912,000 Total 22,997,800 Restaurants & lodging (1.2%) Marriott Intl Cl A 90,000 3,670,200 Retail (8.4%) Best Buy 50,000(b) 3,700,000 Family Dollar Stores 60,000 2,023,800 Home Depot 90,000 4,508,100 Kohl's 40,000(b) 2,651,600 Target 80,000 3,552,800 Wal-Mart Stores 160,000 9,596,800 Total 26,033,100 Utilities -- electric (1.3%) Dominion Resources 70,000 4,120,900 Total common stocks (Cost: $337,611,504) $295,689,200 Short-term securities (4.5%) Issuer Annualized Amount Value(a) yield on date payable at of purchase maturity U.S. government agencies Federal Home Loan Bank Disc Nts 02-01-02 1.94% $500,000 $499,965 02-08-02 1.72 500,000 499,803 04-03-02 1.71 500,000 498,560 Federal Home Loan Mtge Corp Disc Nts 02-05-02 1.67 3,000,000 2,999,304 02-22-02 1.69 200,000 199,794 03-14-02 1.72 4,000,000 3,991,973 03-19-02 1.69 500,000 498,900 03-25-02 1.58 1,800,000 1,795,726 Federal Natl Mtge Assn Disc Nts 02-07-02 1.74 300,000 299,899 02-13-02 1.67 2,800,000 2,798,394 Total short-term securities (Cost: $14,082,964) $14,082,318 Total investments in securities (Cost: $351,694,468)(d) $309,771,518 See accompanying notes to investments in securities. - -------------------------------------------------------------------------------- 20 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT Notes to investments in securities (a) Securities are valued by procedures described in Note 1 to the financial statements. (b) Non-income producing. (c) Foreign security values are stated in U.S. dollars. As of Jan. 31, 2002, the value of foreign securities represented 4.7% of net assets. (d) At Jan. 31, 2002, the cost of securities for federal income tax purposes was approximately $351,694,000 and the approximate aggregate gross unrealized appreciation and depreciation based on that cost was: Unrealized appreciation $ 12,342,000 Unrealized depreciation (54,264,000) ----------- Net unrealized depreciation $(41,922,000) ------------ - -------------------------------------------------------------------------------- 21 AXP GROWTH DIMENSIONS FUND -- SEMIANNUAL REPORT AXP Growth Dimensions Fund 70100 AXP Financial Center Minneapolis, MN 55474 americanexpress.com Ticker Symbol Class A: AXDAX Class B: ABGDX Class C: AXGDX Class Y: N/A This report must be accompanied or preceded by the Fund's current prospectus. Distributed by American Express Financial Advisors Inc. Member NASD. American Express Company is separate from American Express Financial Advisors Inc. and is not a broker-dealer. (logo) American Express S-6015 C (4/02) -----END PRIVACY-ENHANCED MESSAGE-----