-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pMuukYTkaynIadNZp7cgY+RaxRb7JK1QuKd/J07cD5Kmwyf0BZdxlzZiPJaV1eo5 mLUTc/uvJ/aWV4J2Cxppyg== 0000950135-95-000901.txt : 19950414 0000950135-95-000901.hdr.sgml : 19950414 ACCESSION NUMBER: 0000950135-95-000901 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950131 FILED AS OF DATE: 19950407 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUTNAM VOYAGER FUND CENTRAL INDEX KEY: 0000081280 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 046187125 STATE OF INCORPORATION: MA FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-01682 FILM NUMBER: 95527691 BUSINESS ADDRESS: STREET 1: ONE POST OFFICE SQ CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6172921000 FORMER COMPANY: FORMER CONFORMED NAME: PUTNAM VOYAGER FUND INC /PRED/ DATE OF NAME CHANGE: 19821109 N-30D 1 PUTNAM VOYAGER FUND 1 PUTNAM VOYAGER FUND SEMIANNUAL REPORT January 31, 1995 [SCALE LOGO] BOSTON * LONDON * TOKYO 2 PERFORMANCE HIGHLIGHTS The long-term performance of Putnam Voyager Fund's class A shares is truly impressive. According to Lipper Analytical Services, the fund's class A shares were the number-one fund out of 45 capital appreciation funds for 10-year performance as of January 31, 1995. Performance should always be considered in light of a fund's investment strategy. Putnam Voyager Fund is designed for investors agressively seeking capital appreciation through common stocks.
SEMIANNUAL RESULTS AT A GLANCE ----------------------------------------------------------------------- CLASS A CLASS B TOTAL RETURN: NAV POP NAV CDSC (change in value during period plus reinvested distributions) 6 months ended 1/31/95 7.90% 1.72% 7.42% 2.42%
CLASS A CLASS B CLASS M SHARE VALUE: NAV POP NAV NAV POP 7/31/94 $11.19 $11.87 $10.97 -- -- 12/1/94 -- -- -- $11.79 $12.22 1/31/95 11.55 12.25 11.26 11.54 11.96
LONG-TERM DISTRIBUTIONS: NO. INCOME CAPITAL GAINS TOTAL Class A 1 -- $0.508 $0.508 Class B 1 -- 0.508 0.508 Class M 1 -- 0.508 0.508
Performance data represent past results and will differ for each share class. For performance over longer periods, see page 8. POP assumes 5.75% maximum sales charge for class A shares and 3.50% for class M shares. CDSC assumes 5% maximum contingent deferred sales charge. Performance for class M shares, which became effective 12/1/94, is not shown because of the brevity of the reporting period. * Lipper Analytical Services is an independent research organization; rankings vary over time and do not reflect the effects of sales charges. The fund's class A shares ranked 38 out of 139 capital appreciation funds (top 28%) for 1-year performance, 6 out of 81 for 5-year performance (top 8%), and 1 out of 45 for 10-year performance. Past performance is not indicative of future results. 2 3 FROM THE CHAIRMAN [PHOTO] (C) Karsh, Ottawa DEAR SHAREHOLDER: AS PUTNAM VOYAGER FUND EMBARKS ON THE SECOND HALF OF FISCAL 1995, I WOULD LIKE TO BRING TO YOUR ATTENTION SOME IMPORTANT CHANGES IN YOUR FUND'S MANAGEMENT TEAM. ROLAND GILLIS, FORMERLY MANAGER OF THE TOP-PERFORMING KEYSTONE S-4 FUND, HAS JOINED PUTNAM. HE IS WORKING CLOSELY WITH CURRENT MANAGER MATTHEW WEATHERBIE ON THE FOUNDATION GROWTH PORTION OF THE FUND'S PORTFOLIO. ROBERT R. BECK, WHO HAS BEEN WITH PUTNAM SINCE 1989 AND HAS 28 YEARS OF INVESTMENT EXPERIENCE, HAS ALSO JOINED THE VOYAGER TEAM. THESE CHANGES REFLECT THE FACT THAT AFTER MORE THAN 11 YEARS, MATT WILL STEP ASIDE AS PUTNAM VOYAGER'S LEAD MANAGER IN LATE-APRIL. AT THAT TIME, ROLAND, BOB, AND CHARLES SWANBERG, WHO HAS BEEN CO-MANAGING THE FUND WITH MATT SINCE LAST YEAR, WILL ASSUME FULL RESPONSIBILITY FOR DAY-TO-DAY MANAGEMENT OF THE FUND. WITH THE TALENT AND EXPERTISE OF THIS EXPANDED TEAM, I AM CONFIDENT THAT PUTNAM VOYAGER WILL RETAIN ITS INVESTMENT "PERSONALITY" AND THAT IT WILL CONTINUE TO OFFER YOU AN ATTRACTIVE STRATEGY FOR PURSUING LONG-TERM CAPITAL GROWTH. RESPECTFULLY YOURS, SIGNATURE OF GEORGE PUTNAM GEORGE PUTNAM CHAIRMAN OF THE TRUSTEES MARCH 15, 1995 (c) Copyright 3 4 REPORT FROM THE FUND MANAGERS MATTHEW WEATHERBIE, LEAD MANAGER CHARLES SWANBERG ROBERT R. BECK Putnam Voyager Fund experienced a period of strong performance over the six months ended January 31, l995. Despite continually rising interest rates -- which usually have an adverse effect on stock prices -- the fund generated a total return of 7.90% for class A shares and 7.42% for class B shares, both at net asset value (NAV). These returns significantly outpaced the performance of the stock market; over the same period, the Standard & Poor's 500(R) Index produced a total return of 4.14%. See page 8 for more details. STRONG CORPORATE EARNINGS BENEFIT PORTFOLIO HOLDINGS Although the robust corporate earnings growth we've seen recently has not generally been reflected in the broader market, many of the stocks we had selected for the fund's portfolio did, in fact, appreciate. The resulting strong performance over the past six months has confirmed the value of our investment philosophy: an emphasis on individual stock selection, patience, and dedication to long-term results. During the period, a number of portfolio stocks rebounded from the severe declines sustained in the summer of 1994. The recoveries occurred as it became clear that our reasons for purchasing these stocks -- strong earnings prospects, healthy balance sheets, attractive product lines, and solid managements -- were attracting an increasing number of investors. Your fund's sector weightings changed only slightly over this period. More than 50% of the portfolio remains invested in foundation growth stocks -- stocks of small and medium-sized rapidly growing firms we consider tomorrow's blue chips. We believe these companies have the potential to provide high returns on invested capital. We have concentrated primarily on five sectors -- technology, consumer, media, services, and 4 5 health care. One favored foundation growth holding is Healthsource, a well-managed health maintenance organization (HMO), which provides high-quality health care while tightly controlling costs. Healthsource has grown by entering new regional markets where HMO penetration has been low. Opportunity stocks -- stocks of undervalued companies that are undergoing positive changes -- made up 24% of the portfolio at the end of the period. The fund's investments in opportunity stocks were concentrated in consumer staples, publishing, specialty retailers, financial services, and technology. Dow Jones & Company is one of the stocks we hold in this category. Best known for its flagship product, The Wall Street Journal, the company has also carved a successful niche for itself in the electronic publishing industry and now provides real-time investment data to a growing audience of financial-market participants. Although Dow Jones's stock price was lower at the end of the period than it was in l987, we believe this price does not reflect the company's current potential for increased earnings growth. ADAPTING TO SIGNIFICANT CHANGE Over the past several years, your fund has evolved from a relatively small capital appreciation fund to a large fund with more than $4.8 billion in assets. To accommodate this growth, we have expanded the fund's investment universe while continuing to use the same highly selective criteria that have proved effective thus far. Foundation and opportunity stocks still make up most of the portfolio's holdings. However, a significant portion of your fund's assets -- about 20% as of TOP INDUSTRY SECTORS* -------------------------------------------------------------------- Services 22.2% Technology 19.0% Consumer 16.5% Health Care 13.4% Media 9.5% * Based on net assets as of 1/31/95. Holdings will vary over time. --------------------------------------------------------------------
5 6 January 31, l995 -- are now being invested in the stocks of midsize and large well-established companies. These stocks, known as "premier growth stocks," are similar to foundation growth stocks, but are stocks of companies that are at a more mature stage of business and economic development. In many cases, we have followed these companies from their infancy through their rapid growth phase to maturity. While premier growth stocks generally appreciate at a moderately slower pace than foundation growth stocks, these companies have above-average growth rates, substantial business franchises, and financial strength. We believe their stocks are an important component of the portfolio. FINDING GROWTH OVERSEAS Our research into premier growth stocks has taken us beyond U.S. borders. As the economies of many highly industrialized countries gained strength, we uncovered a number of overseas companies that met our standards for strong fundamentals and growth potential. At the close of the reporting period, nearly 4% of fund assets were invested in foreign companies in the premier growth category. One such holding is SAP Software, a German company that is the world leader in providing financial applications software to large companies that are moving away from mainframe computing and toward client-server computing. By using client-server systems, companies can distribute information throughout their organizations through desktop computers or through computers in regional locations. OUTLOOK: A FUNDAMENTALLY SOUND INVESTMENT CLIMATE While interest rates could move higher over the next few months, we believe most of the interest rate increases are behind us. Even though slightly higher rates could trigger a short-term pullback in stock prices, we are optimistic about the near-term prospects for your fund. In our opinion, the stock price appreciation we saw over the past six months still does not truly reflect the earnings growth of many of the 6 7 TOP 10 HOLDINGS AS OF 1/31/95 -------------------------------------------------------------------- H & R BLOCK, INC. TAX PREPARATION AND ON-LINE SERVICES TELECOMMUNICATIONS, INC. OPERATES CABLE TELEVISION SYSTEMS FLIGHT SAFETY INTERNATIONAL INC. TRAINING FOR AIRCRAFT OPERATORS TELEPHONE & DATA SYSTEMS, INC. PROVIDES LOCAL TELEPHONE SERVICES IN MANY STATES CENTURY TELEPHONE ENTERPRISES TELEPHONE AND CELLULAR SERVICES PROVIDER INTERPUBLIC GROUP OPERATES ADVERTISING AGENCIES FIRST DATA CORP. PROVIDES INFORMATION PROCESSING SYSTEMS LIN BROADCASTING CORP. OWNS INTEREST IN CELLULAR PHONE SYSTEMS DANKA BUSINESS SYSTEMS ADR OFFICE EQUIPMENT SERVICES HOME DEPOT RETAILS BUILDING AND HOME IMPROVEMENT MATERIALS These holdings represent 17.7% of the fund's net assets. Portfolio holdings will vary over time. -------------------------------------------------------------------- companies we follow. In other words, the strength and fundamentals are there. Given more hospitable market conditions, we should see even stronger performance over the remainder of fiscal l995. The views expressed here are exclusively those of Putnam Management. They are not meant as investment advice. Although the described holdings were viewed favorably as of January 31, 1995, there is no guarantee the fund will continue to hold these securities in the future. 7 8 PERFORMANCE SUMMARY This section provides, at a glance, information about your fund's performance. Total return shows how the value of the fund's shares changed over time, assuming you held the shares through the entire period and reinvested all distributions back into the fund. We show total return in two ways: on a cumulative long-term basis and on average how the fund might have grown each year over varying periods. For comparative purposes, we show how the fund performed relative to appropriate indexes and benchmarks. TOTAL RETURN FOR PERIODS ENDING 1/31/95
CLASS A CLASS B STANDARD & POOR'S 500 NAV POP NAV CDSC Index CPI ------------------------------------------------------------------------------ 6 months 7.90% 1.72% 7.42% 2.42% 4.14% 1.28% ------------------------------------------------------------------------------ 1 year -1.83 -7.48 -2.61 -7.27 0.55 2.80 ------------------------------------------------------------------------------ 5 years 114.16 101.72 -- -- 66.70 17.98 Annual average 16.45 15.07 -- -- 10.76 3.36 ------------------------------------------------------------------------------ 10 years 366.12 339.37 -- -- 263.87 42.46 Annual average 16.64 15.95 -- -- 13.79 3.60 ------------------------------------------------------------------------------ Life of class B 37.77 34.77 22.68 7.74 Annual average 12.31 11.42 7.69 2.74 ------------------------------------------------------------------------------
TOTAL RETURN FOR PERIODS ENDING 12/31/94 (most recent calendar quarter)
CLASS A CLASS B NAV POP NAV CDSC --------------------------------------------------------------------------------- 1 year 0.44% -5.32% -0.31% -5.07% --------------------------------------------------------------------------------- 5 years 90.64 79.64 -- -- Annual average 13.77 12.43 -- -- --------------------------------------------------------------------------------- 10 years 424.69 394.42 -- -- Annual average 18.03 17.33 -- -- --------------------------------------------------------------------------------- Life of class B -- -- 37.65 34.65 Annual average -- -- 12.66 11.74 ---------------------------------------------------------------------------------
Fund performance data do not take into account any adjustment for taxes payable on reinvested distributions or, for class A shares, distribution fees prior to implementation of the class A distribution plan in 1990. Effective 4/27/92, the fund began offering class B shares, and on 12/1/94, class M shares. Performance of share classes will differ; performance for class M shares is not shown because of the brevity of the reporting period. Performance data represent past results. Investment returns and net asset value will fluctuate so an investor's shares, when sold, may be worth more or less than their original cost. 8 9 TERMS AND DEFINITIONS CLASS A SHARES are generally subject to an initial sales charge. CLASS B SHARES may be subject to a sales charge upon redemption. CLASS M SHARES have a lower initial sales charge and a higher 12b-1 fee than class A shares and no sales charge on redemption. NET ASSET VALUE (NAV) is the value of all your fund's assets, minus any liabilities, divided by the number of outstanding shares, not including any initial or contingent deferred sales charge. PUBLIC OFFERING PRICE (POP) is the price of a mutual fund share plus the maximum sales charge levied at the time of purchase. POP performance figures shown here assume the maximum 5.75% sales charge for class A shares and 3.50% for class M shares. CONTINGENT DEFERRED SALES CHARGE (CDSC) is a charge applied at the time of the redemption of class B shares and assumes redemption at the end of the period. Your fund's CDSC declines from a 5% maximum during the first year to 1% during the sixth year. After the sixth year, the CDSC no longer applies. COMPARATIVE BENCHMARKS STANDARD & POOR'S 500 INDEX is an unmanaged list of common stocks that is frequently used as a general measure of stock market performance. The index assumes reinvestment of all distributions and does not take into account brokerage commissions or other costs. The fund's portfolio contains securities that do not match those in the index. CONSUMER PRICE INDEX (CPI) is a commonly used measure of inflation; it does not represent an investment return. 9 10 PUTNAM FAMILY OF FUNDS PUTNAM GROWTH FUNDS Income Fund Asia Pacific Growth Fund U.S. Government Income Trust Capital Appreciation Fund Diversified Equity Trust PUTNAM TAX-FREE INCOME FUNDS Europe Growth Fund Intermediate Tax Exempt Fund Global Growth Fund Municipal Income Fund Health Sciences Trust Tax Exempt Income Fund Investors Fund Tax-Free High Yield Fund Natural Resources Fund* Tax-Free Insured Fund New Opportunities Fund OTC Emerging Growth Fund STATE TAX-FREE FUNDS+ Overseas Growth Fund Arizona, California, Florida, Massachusetts, Michigan, Vista Fund Minnesota, New Jersey, New York, Voyager Fund Ohio, and Pennsylvania PUTNAM GROWTH AND INCOME FUNDS LIFESTAGE(SM) FUNDS Convertible Income-Growth Trust Putnam Asset Allocation Funds--three investment portfolios Dividend Growth Fund that spread your money across Equity Income Fund a variety of stocks, bonds, The George Putnam Fund of Boston and money market investments to help maximize The Putnam Fund for Growth and Income your return and reduce your risk. Growth and Income Fund II Managed Income Trust The three portfolios: Utilities Growth and Income Fund Putnam Asset Allocation: Balanced Portfolio Putnam Asset Allocation: Conservative Portfolio PUTNAM INCOME FUNDS Putnam Asset Allocation: Growth Portfolio Adjustable Rate U.S. Government Fund American Government Income Fund MOST CONSERVATIVE INVESTMENTS++ Balanced Government Fund PUTNAM MONEY MARKET FUNDS: Preferred Income Trust Money Market Fund(ss) Diversified Income Trust Tax Exempt Money Market Fund Federal Income Trust Global Governmental Income Trust CDS AND SAVINGS ACCOUNTS** High Yield Advantage Fund * Formerly Energy-Resources Trust. High Yield Trust + Not available in all states. ++ Relative to above. Please call your financial advisor or Putnam to ss Formerly Daily Dividend Trust. obtain a prospectus for any Putnam fund. It ** Not offered by Putnam Investments. Certificates contains more complete information, including of deposit offer a fixed rate of return charges and expenses. Read it carefully before and may be insured, up to certain limits, you invest or send money. by federal/state agencies. Savings accounts may also be insured up to certain limits.
10 11 PORTFOLIO OF INVESTMENTS OWNED January 31, 1995
COMMON STOCKS (87.6%)* NUMBER OF SHARES VALUE ADVERTISING (0.4%) - ----------------------------------------------------------------------------- 392,000 Omnicom Group $ 19,698,000 AEROSPACE (2.7%) - ----------------------------------------------------------------------------- 2,929,330 Flight Safety International, Inc. 109,849,875 784,200 GenCorp Inc. 9,998,550 195,600 Textron, Inc. 10,097,850 ------------ 129,946,275 ALCOHOLIC BEVERGAGES (0.2%) - ----------------------------------------------------------------------------- 313,600 Seagram Co. Ltd. 9,016,000 APPAREL (0.2%) - ----------------------------------------------------------------------------- 392,200 Tommy Hilfiger 7,991,075 AUTOMOTIVE (0.4%) - ----------------------------------------------------------------------------- 215,100 General Motors Corp. 8,335,125 294,000 Snap-On Inc. 9,297,750 ------------ 17,632,875 BANKS (1.0%) - ----------------------------------------------------------------------------- 333,300 Banc One Corp. 9,832,350 332,800 Bank of Boston Corp. 9,318,400 150,000 BankAmerica Corp. 6,468,750 110,000 Citicorp 4,468,750 215,300 First Fidelity Bancorp 10,172,925 352,700 National City Corp. 9,346,550 ------------ 49,607,725 BROADCASTING (2.7%) - ----------------------------------------------------------------------------- 75,000 CBS Inc. 4,378,125 506,635 Clear Channel Communications, Inc. + 25,711,726 1,550,860 Infinity Broadcasting Corp. Class A + 49,433,663 416,620 LIN Television Corp. + 10,806,081 784,200 Renaissance Communications Corp. + 22,153,650 1,841,400 Westwood One, Inc. 17,953,650 ------------ 130,436,895 BUSINESS EQUIPMENT AND SERVICES (11.8%) - ----------------------------------------------------------------------------- 881,690 Airgas, Inc. + 21,160,560 245,700 Antec Corp. + 4,115,475 4,252,780 Block (H & R), Inc. 152,036,868 2,286,844 Danka Business Systems ADR 54,026,690 330,000 First USA, Inc. 11,385,000 398,190 ITEL Corp. + 13,986,424 391,876 Interim Services, Inc. + 9,160,102 2,104,134 Interpublic Group of Cos., Inc. 70,751,506
11 12
COMMON STOCKS NUMBER OF SHARES VALUE BUSINESS EQUIPMENT AND SERVICES (continued) - ----------------------------------------------------------------------------- 489,840 Kelly Services, Inc. Class A $ 14,695,200 1,269,820 Loewen Group, Inc. 35,554,960 1,775,220 Manpower, Inc. 45,268,110 2,043,727 Office Depot, Inc. + 53,136,902 196,000 Officemax, Inc. + 5,096,000 722,665 Olsten Corp. (The) 23,938,278 947,525 Paychex, Inc. 36,953,475 784,300 Robert Half International, Inc. + 18,234,975 176,300 Tandy Corp. 7,801,275 ------------ 577,301,800 BUSINESS SERVICES (0.2%) - ----------------------------------------------------------------------------- 294,000 Dow Jones & Co., Inc. + 9,628,500 CABLE TELEVISION (5.2%) - ----------------------------------------------------------------------------- 431,770 Cablevision Systems Corp. Class A + 22,344,098 1,565,645 Century Communications Corp. Class A 11,938,043 3,327,442 Comcast Corp. Special Class A 49,911,630 370,910 Gaylord Entertainment Co. 8,623,658 1,025,515 TCA Cable TV, Inc. 22,945,898 5,778,647 Tele-Communications Inc. Class A + 122,796,249 324,505 Viacom, Inc. Class B + 14,967,793 ------------ 253,527,369 CELLULAR COMMUNICATIONS (4.1%) - ----------------------------------------------------------------------------- 937,033 Airtouch Communications, Inc. + 25,768,408 603,080 Cellular Communications of Puerto Rico, Inc. + 18,695,480 363,000 Cellular Communications, Inc. Class A + 18,240,750 404,980 LIN Broadcasting Corp. 56,292,220 1,482,980 Paging Network, Inc. + 50,421,320 1,122,900 Vanguard Cellular Systems, Inc. + 28,353,225 ------------ 197,771,403 CHEMICALS (1.1%) - ----------------------------------------------------------------------------- 146,900 FMC Corp. + 8,501,838 370,000 Great Lakes Chemical Corp. 21,043,750 563,083 Schulman (A.), Inc. 15,907,095 353,200 Witco Chemical Corp. 9,271,500 ------------ 54,724,183 COMPUTER PERIPHERALS (0.4%) - ----------------------------------------------------------------------------- 391,400 American Power Conversion Corp. + 6,115,625 587,900 Cognex Corp. + 12,492,875 ------------ 18,608,500 COMPUTER SERVICES (2.0%) - ----------------------------------------------------------------------------- 741,400 America Online, Inc. + 40,406,300 1,180,400 First Data Corp. 59,462,650 ------------ 99,868,950
12 13 COMMON STOCKS NUMBER OF SHARES VALUE
COMPUTER SOFTWARE (3.3%) - ----------------------------------------------------------------------------- 1,117,000 Cisco Systems, Inc. + $ 37,279,875 196,000 Computer Associates International, Inc. 9,775,500 26,200 Electronic Arts + 468,325 294,410 FTP Software, Inc. + 8,206,679 700,660 Lotus Development Corp. + 31,266,953 117,700 Netmanage, Inc. + 4,487,313 1,227,300 Novell, Inc. + 21,784,575 392,380 PeopleSoft, Inc. + 12,703,303 490,000 Platinum Software Corp. + 4,410,000 337,800 PLATINUM Technology Inc. + 7,009,350 196,000 Pyxis Corp. + 3,773,000 222,890 Sybase, Inc. + 9,695,715 257,900 Wall Data, Inc. + 9,413,350 ------------ 160,273,938 COMPUTERS (0.4%) - ----------------------------------------------------------------------------- 254,800 Compaq Computer Corp. 9,109,100 587,200 EMC Corp. + 10,936,600 ------------ 20,045,700 CONSUMER PRODUCTS (1.0%) - ----------------------------------------------------------------------------- 588,100 Cardinal Health, Inc. 27,126,113 445,700 Newell Co. 10,028,250 215,500 Walgreen Co. 10,236,250 ------------ 47,390,613 CONSUMER SERVICES (1.0%) - ----------------------------------------------------------------------------- 1,062,340 CUC International, Inc. + 36,783,523 117,500 Capital Cities/ABC, Inc. 9,752,500 ------------ 46,536,023 CONTAINERS (0.4%) - ----------------------------------------------------------------------------- 479,800 Bemis Inc. 12,054,975 784,070 Owens-Illinois, Inc. + 8,134,726 ------------ 20,189,701 ELECTRIC UTILITIES (0.1%) - ----------------------------------------------------------------------------- 489,100 Huaneng Power International, Inc. ADR 6,297,163 ELECTRONICS AND ELECTRICAL EQUIPMENT (2.5%) - ----------------------------------------------------------------------------- 587,250 Baldor Electric Co. 15,782,344 392,180 DSC Communications Corp. + 12,598,783 294,100 General Instrument Corp. + 8,014,225 196,000 Grainger (W.W.), Inc. 11,686,500 215,300 Illinois Tool Works, Inc. 8,665,825 166,400 Motorola, Inc. 9,838,400 294,200 Stratacom, Inc. + 10,517,650 739,500 Xilinx Inc. + 42,706,125 ------------ 119,809,852 ENTERTAINMENT (-%) - ----------------------------------------------------------------------------- 153,447 National Gaming Corp. + 1,457,747
13 14 COMMON STOCKS NUMBER OF SHARES VALUE
FINANCE (2.5%) - ----------------------------------------------------------------------------- 403,600 Federal Home Loan Mortgage. Corp. $ 22,601,600 330,357 Federal National Mortgage Association 23,620,526 433,300 Financial Federal Corp. + 8,232,700 294,000 Greentree Acceptance, Inc. 9,297,750 47,000 Household International, Inc. 1,909,375 955,759 MBNA Corp. 24,371,855 343,400 Morgan (J.P.) & Co., Inc. 21,634,200 293,800 Student Loan Marketing Assn. 10,980,775 ------------ 122,648,781 FOOD AND BEVERAGES (0.9%) - ----------------------------------------------------------------------------- 547,000 Coca-Cola Co. 28,717,500 274,200 IBP., Inc. 8,191,725 3,451,310 Iceland Group 8,394,966 ------------ 45,304,191 HEALTH CARE AND HMOS (1.0%) - ----------------------------------------------------------------------------- 798,040 Healthsource, Inc. + 34,116,210 489,800 Sierra Health Services + 14,877,675 ------------ 48,993,885 HEALTH CARE INFORMATION SYSTEMS (0.1%) - ----------------------------------------------------------------------------- 196,060 HBO & Co. 6,984,638 HEALTH CARE SERVICES (6.5%) - ----------------------------------------------------------------------------- 353,200 Amgen, Inc. + 22,472,350 244,000 Biomet, Inc. + 3,690,500 235,200 Columbia/HCA Healthcare Corp. 9,437,400 50,000 Coram Healthcare Corp. + 1,068,750 978,865 Health Management Associates, Inc. + 26,918,788 391,810 Homedco Group, Inc. + 16,235,627 370,655 Horizon Healthcare Corp. + 9,822,358 1,465,750 Lincare Holdings, Inc. + 38,109,500 685,800 Mid Atlantic Medical Services, Inc. + 16,287,750 391,910 Oxford Health Plans Inc. + 33,263,361 586,915 Pacificare Health Systems, Inc. Class B + 37,856,018 588,500 Renal Treatment Centers, Inc. + 12,947,000 284,300 Rotech Medical Corp. 7,818,250 312,480 Target Therapeutics, Inc. + 10,155,600 489,800 United Healthcare Corp. 23,755,300 465,730 Value Health, Inc. + 17,057,361 1,027,950 Vencor, Inc. + 31,352,475 ------------ 318,248,388 HOUSEHOLD PRODUCTS (0.2%) - ----------------------------------------------------------------------------- 299,100 Blyth Industries, Inc. + 8,412,188 INSURANCE (3.6%) - ----------------------------------------------------------------------------- 107,700 American International Group, Inc. 11,214,263 599,580 Bankers Life Holding Corp. 12,366,338 195,990 Cincinnati Financial Corp. 10,117,984 294,300 EXEL Ltd. 11,551,275 589,589 Gallagher (Arthur J.) & Co. 20,119,725 267,210 General RE Corp. 34,503,491
14 15
COMMON STOCKS NUMBER OF SHARES VALUE INSURANCE (continued) - ----------------------------------------------------------------------------- 783,500 Life Partners Group, Inc. $ 16,355,563 4,207,880 Rentokil Group 14,754,931 391,900 Transatlantic Holdings Inc. 21,554,500 646,100 USF&G Corp. 9,691,500 352,800 Zurich Reinsurance Centre Holdings, Inc. + 10,231,200 ------------ 172,460,770 LODGING (1.5%) - ----------------------------------------------------------------------------- 1,881,280 Hospitality Franchise System, Inc. 52,675,840 979,950 La Quinta Inns, Inc. 19,231,519 ------------ 71,907,359 MEDICAL EQUIPMENT AND SUPPLIES (2.5%) - ----------------------------------------------------------------------------- 1,756,420 Boston Scientific Corp. + 32,493,770 518,302 Haemonetics Corp. + 7,709,742 175,000 Johnson & Johnson 10,171,875 901,660 Medtronic, Inc. 53,536,063 195,690 Sofamor/Danek Group, Inc. + 3,155,501 391,890 Stryker Corp. 15,773,573 ------------ 122,840,524 OIL AND GAS (2.3%) - ----------------------------------------------------------------------------- 235,200 Burlington Resources Inc. + 8,114,400 320,900 Coflexip (ADR) 7,862,050 147,000 Exxon Corp. 9,187,500 107,800 Mobil Corp. 9,311,225 1,161,400 Petro Geo-Services AS ADR + 25,986,325 510,000 Production Operators Corp. 11,475,000 176,400 Royal Dutch Petroleum Co. ADR 19,734,750 200,000 Schlumberger Limited 10,550,000 293,800 Total Corp. ADS 8,336,575 ------------ 110,557,825 PAPER (0.4%) - ----------------------------------------------------------------------------- 149,200 Alco Standard Corp. 9,586,100 254,800 Weyerhaeuser Co. 9,650,550 ------------ 19,236,650 PARCEL DELIVERY SERVICE (0.2%) - ----------------------------------------------------------------------------- 146,700 Federal Express Corp. + 8,912,025 PHARMACEUTICALS AND BIOTECHNOLOGY (3.2%) - ----------------------------------------------------------------------------- 330,000 Abbott Laboratories 11,673,750 1,085,300 Astra AB 27,461,997 293,390 Biogen, Inc. + 10,672,061 700,000 Elan Corp., PLC ADR 24,675,000 241,420 Genzyme Corp. + 8,510,055 440,134 ICN Pharmaceuticals, Inc. 8,252,517 156,600 Lilly (Eli) & Co. 10,316,025 533,500 Pfizer, Inc. 43,613,625 274,200 Upjohn Co. 9,219,975 ------------ 154,395,005
15 16
COMMON STOCKS NUMBER OF SHARES VALUE PHOTOGRAPHY (0.2%) - ----------------------------------------------------------------------------- 220,000 Eastman Kodak Co. $ 10,780,000 PUBLISHING (1.0%) - ----------------------------------------------------------------------------- 700,000 Reuters Holdings PLC ADR 29,312,500 259,430 Wolters Kluwer N.V. 19,159,684 ------------ 48,472,184 RECREATION (0.3%) - ----------------------------------------------------------------------------- 430,600 Mirage Resorts, Inc. + 9,634,675 627,100 Rio Hotel & Casino, Inc. + 7,211,650 ------------ 16,846,325 RESTAURANTS (2.3%) - ----------------------------------------------------------------------------- 195,600 Apple South, Inc. 2,322,750 1,172,900 Applebee's International, Inc. 20,012,606 489,915 Brinker International, Inc. + 8,634,752 1,040,173 Buffets, Inc. + 10,141,687 1,804,225 J.D. Wetherspoon PLC 13,308,505 721,058 McDonald's Corp. 23,524,517 892,165 Outback Steakhouse, Inc. + 23,642,373 63,700 Papa Johns International, Inc. + 2,054,325 800,200 Taco Cabana, Inc. + 6,051,513 ------------ 109,693,028 RETAIL (5.6%) - ----------------------------------------------------------------------------- 731,286 Albertsons, Inc. 21,755,759 392,400 AnnTaylor + 13,145,400 978,600 Bed Bath & Beyond, Inc. + 26,177,550 69,561 Castorama Dubois Investisse 9,333,605 676,820 Gymboree Corp. + 16,243,680 981,750 Heilig-Meyers Co. 25,034,625 1,150,300 Home Depot, Inc. (The) 53,776,520 135,830 Hornbach Holding 13,761,141 480,674 Lowes Cos., Inc. 17,664,770 5,372,900 Next PLC 21,385,754 442,950 Stein Mart, Inc. + 5,869,088 765,400 Sunglass Hut International + 17,795,550 392,400 Talbots, Inc. 11,919,150 392,000 The Sports Authority, Inc. + 6,909,000 451,800 Tiffany & Co. New 13,158,675 ------------ 273,930,267 SEMICONDUCTORS (2.7%) - ----------------------------------------------------------------------------- 50,000 Altera Corp. + 2,225,000 1,297,050 Analog Devices Inc. 27,886,575 583,246 Linear Technology Corp. 28,870,677 1,718,150 Maxim Integrated Products Inc. + 49,826,350 490,200 National Semiconductor Corp. + 8,946,150 136,900 Texas Instruments, Inc. 9,446,100 177,145 Zilog Inc. + 5,137,205 ------------ 132,338,057
16 17
COMMON STOCKS NUMBER OF SHARES VALUE SPECIALTY CONSUMER PRODUCTS (1.9%) - ----------------------------------------------------------------------------- 916,652 Department 56, Inc. + $ 33,572,380 490,060 Fastenal Co. 21,041,951 146,000 Gillette Co. (The) 11,223,750 254,200 Harcourt General, Inc. 8,483,925 576,520 Luxottica Group ADS 19,817,875 -------------- 94,139,881 STEEL (0.8%) - ----------------------------------------------------------------------------- 559,200 Nucor Corp. 28,519,200 588,420 Worthington Industries, Inc. 11,768,400 -------------- 40,287,600 TELEPHONE SERVICES (5.2%) - ----------------------------------------------------------------------------- 886,280 ALC Communications Corp. + 25,702,120 2,848,335 Century Telephone Enterprises, Inc. 89,722,553 391,400 LDDS Communications, Inc. + 8,512,950 200,000 MCI Communications Corp. 3,675,000 464,653 MFS Communications Company, Inc. + 17,656,814 370,000 Sprint Corp. 10,545,000 2,161,840 Telephone & Data Systems, Inc. 94,580,500 -------------- 250,394,937 TELEPHONE UTILITIES (0.6%) - ----------------------------------------------------------------------------- 333,600 ALLTEL Corp. 9,465,900 449,800 Southwestern Bell Corp. 19,172,725 -------------- 28,638,625 TEXTILES (0.3%) - ----------------------------------------------------------------------------- 391,900 St. John Knits, Inc. 12,393,838 TOBACCO (0.7%) - ----------------------------------------------------------------------------- 1,148,400 UST Inc. 33,877,800 TOTAL COMMON STOCKS (cost $ 3,739,404,481) $4,260,455,058 - -----------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS (0.9%)* (cost $ 24,876,059) NUMBER OF SHARES VALUE 880,900 Cellular Communications, Inc. $0.01 cv., pfd. $ 44,265,225 PREFERRED STOCKS (0.5%)* (cost $ 17,779,924) NUMBER OF SHARES VALUE 35,290 Sap Ag Systeme Preference Bearer $ 22,192,205 CONVERTIBLE BONDS (0.1%)* (cost $ 6,837,500) NUMBER OF SHARES VALUE 6,800,000 ICN Pharmaceuticals cv. deb. 81/2s 11/15/1999 $ 6,732,000
17 18
WARRANTS (-%)+(cost $---) NUMBER OF WARRANTS EXPIRATION DATE VALUE 10,673 Jan Bell Marketing, Inc. 12/16/98 $ 672
SHORT-TERM INVESTMENTS (9.9%)* PRINCIPAL AMOUNT VALUE 27,433,000 Bell Atlantic Financial Services, Inc. 5.8s, February 23, 1995 $ 27,340,185 30,000,000 Federal Home Loan Banks 5.6s, February 9, 1995 29,962,667 40,000,000 Federal Home Loan Banks 5.83s, February 7, 1995 39,961,134 30,000,000 Federal Home Loan Mortgage Corp. 5.5s, February 7, 1995 29,977,084 40,000,000 Federal Home Loan Mortgage Corp. 5.6s, February 9, 1995 39,950,222 100,000,000 Federal National Mortgage Assn. 5.6s, February 21,1995 99,681,111 28,000,000 Federal National Mortgage Association 5.92s, March 8, 1995 27,838,844 22,000,000 General Electric Capital Corp. 5.82s, February 23, 1995 21,918,197 25,000,000 Heller Financial Inc. 5.88s, February 2, 1995 24,991,833 40,000,000 Morgan (J.P.) & Co. Inc. 5.80s, February 21, 1995 39,864,668 35,000,000 Preferred Receivables Funding Corp. 5.87s, February 27, 1995 34,845,912 22,605,000 Preferred Receivables Funding Corp. 5.8s, February 7, 1995 22,579,506 15,000,000 Sears Roebuck Accept Corp. 5.93s, February 9, 1995 14,980,233 29,836,000 Interest in $605,000,000 joint repurchase agreement dated January 31, 1995 with Goldman Sachs, due February 1, 1995 with respect to various U.S. Treasury Obligations -- maturity value of $29,840,740 for an effective yield of 5.72% 29,840,740 -------------- TOTAL SHORT-TERM INVESTMENTS (cost $ 314,411,375) $ 483,732,336 -------------- TOTAL INVESTMENTS *** (cost $ 4,103,309,339) $4,817,377,496 ==============
NOTES --------------------------------------------------------------------------- * Percentages indicated are based on total net assets of $4,864,758,268, which correspond to a net asset value per Class A, Class B and Class M share of $11.19, $10.97, and $11.54, respectively. ***The aggregate identified cost for federal income tax purposes is $4,111,353,931 resulting in gross unrealized appreciation and depreciation of $842,700,090 and $136,676,525, respectively, or net unrealized appreciation of $706,023,565. + Non-income-producing security. ADR or ADS after the name of a foreign holding stands for American Depository Receipt or American Depository Shares, respectively, representing ownership of foreign securities on deposit with a domestic custodian bank. The accompanying notes are an integral part of these financial statements. 18 19 STATEMENT OF ASSETS AND LIABILITIES January 31, 1995 (Unaudited)
ASSETS ---------------------------------------------------------------------------------------------- Investments in securities, at value (identified cost $4,103,309,339) (Note 1) $4,817,377,496 ---------------------------------------------------------------------------------------------- Cash 448 ---------------------------------------------------------------------------------------------- Dividends, interest and other receivables 2,439,682 ---------------------------------------------------------------------------------------------- Receivable for shares of the fund sold 29,750,045 ---------------------------------------------------------------------------------------------- Receivable for securities sold 44,926,766 ---------------------------------------------------------------------------------------------- TOTAL ASSETS 4,894,494,437
LIABILITIES ---------------------------------------------------------------------------------------------- Payable for securities purchased 5,153,908 ---------------------------------------------------------------------------------------------- Payable for shares of the fund repurchased 12,988,171 ---------------------------------------------------------------------------------------------- Payable for compensation of Manager (Note 2) 6,328,458 ---------------------------------------------------------------------------------------------- Payable for investor servicing and custodian fees (Note 2) 2,798,567 ---------------------------------------------------------------------------------------------- Payable for administrative services (Note 2) 31,452 ---------------------------------------------------------------------------------------------- Payable for distribution fees (Note 2) 1,755,613 ---------------------------------------------------------------------------------------------- Other accrued expenses 680,000 ---------------------------------------------------------------------------------------------- TOTAL LIABILITIES 29,736,169 ---------------------------------------------------------------------------------------------- NET ASSETS $4,864,758,268 ---------------------------------------------------------------------------------------------- REPRESENTED BY ---------------------------------------------------------------------------------------------- Paid-in capital (Note 1 and 4) $4,067,084,780 Accumulated net investment loss (Note 1) (2,461,726) Accumulated net realized gain on investment transactions (Note 1) 86,067,057 Net unrealized appreciation of investments 714,068,157 ---------------------------------------------------------------------------------------------- TOTAL -- REPRESENTING NET ASSETS APPLICABLE TO CAPITAL SHARES OUTSTANDING $4,864,758,268 ---------------------------------------------------------------------------------------------- COMPUTATION OF NET ASSET VALUE AND OFFERING PRICE ---------------------------------------------------------------------------------------------- Net asset value and redemption price of class A shares ($3,552,912,235 divided by 307,743,326 shares) $11.55 ---------------------------------------------------------------------------------------------- Offering price per class A share (100/94.25 of $11.55)* $12.25 ---------------------------------------------------------------------------------------------- Net asset value and offering price of class B shares ($1,195,476,770 divided by 106,139,766 shares)** $11.26 ---------------------------------------------------------------------------------------------- Net asset value and offering price of class Y shares ($115,461,479 divided by 9,966,354 shares)** $11.59 ---------------------------------------------------------------------------------------------- Net asset value and redemption price of class M shares ($907,791 divided by 78,652 shares)** $11.54 ---------------------------------------------------------------------------------------------- Offering price per class M shares (100/96.50 of $11.54) $11.96 ----------------------------------------------------------------------------------------------
* On single retail sales of less than $50,000. On sales of $50,000 or more the offering price is reduced. ** Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge. The accompanying notes are an integral part of these financial statements. 19 20 STATEMENT OF OPERATIONS Six months ended January 31,1995 (Unaudited) ---------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends (net of foreign tax of $231,634) $ 18,094,553 Interest 7,896,092 ---------------------------------------------------------------------------------------------- TOTAL INVESTMENT INCOME 25,990,645 EXPENSES: ---------------------------------------------------------------------------------------------- Compensation of Manager (Note 2) 12,325,903 ---------------------------------------------------------------------------------------------- Investor servicing and custodian fees (Note 2) 5,463,632 ---------------------------------------------------------------------------------------------- Compensation of Trustees (Note 2) 52,229 ---------------------------------------------------------------------------------------------- Distribution fees-- Class A (Note 2) 4,237,052 ---------------------------------------------------------------------------------------------- Distribution fees-- Class B (Note 2) 5,433,303 ---------------------------------------------------------------------------------------------- Distribution fees-- Class M (Note 2) 524 ---------------------------------------------------------------------------------------------- Reports to shareholders 183,725 ---------------------------------------------------------------------------------------------- Auditing 77,062 ---------------------------------------------------------------------------------------------- Legal 31,870 ---------------------------------------------------------------------------------------------- Postage 313,074 ---------------------------------------------------------------------------------------------- Administrative services (Note 2) 26,879 ---------------------------------------------------------------------------------------------- Registration fees 242,839 ---------------------------------------------------------------------------------------------- Other 95,505 ---------------------------------------------------------------------------------------------- Fees waived by Manager (31,226) ---------------------------------------------------------------------------------------------- TOTAL EXPENSES 28,452,371 ---------------------------------------------------------------------------------------------- NET INVESTMENT LOSS (2,461,726) ---------------------------------------------------------------------------------------------- Net realized gain on investments (Notes 1 and 3) 140,621,056 ---------------------------------------------------------------------------------------------- Net realized loss on written options (1,650) ---------------------------------------------------------------------------------------------- Net realized loss on foreign currency translation (10,004) ---------------------------------------------------------------------------------------------- Net unrealized appreciation of investments during the year 183,040,500 ---------------------------------------------------------------------------------------------- NET GAIN ON INVESTMENTS 323,649,902 ---------------------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 321,188,176 ----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements. 20 21 STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS YEAR ENDED ENDED JANUARY 31* JULY 31 ---------------------------------- 1995 1994 INCREASE IN NET ASSETS ------------------------------------------------------------------------------------- Operations: ------------------------------------------------------------------------------------- Net investment loss $ (2,461,726) $ (11,101,856) ------------------------------------------------------------------------------------- Net realized gain on investments, written options and foreign currency translation 140,609,402 197,390,941 ------------------------------------------------------------------------------------- Net unrealized appreciation of investments 183,040,500 (66,870,273) ------------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 321,188,176 119,418,812 ------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: ------------------------------------------------------------------------------------- Net realized gain on investments Class A (145,546,174) (104,366,667) Class B (49,512,026) (22,949,719) Class Y (4,827,692) -- Class M (12,706) -- ------------------------------------------------------------------------------------- Increase from capital share transactions (Note 4) 698,420,874 1,241,253,150 ------------------------------------------------------------------------------------- TOTAL INCREASE IN NET ASSETS 819,710,452 1,233,355,576 Beginning of year 4,045,048,716 2,811,693,140 ------------------------------------------------------------------------------------- END OF YEAR (including accumulated net investment loss of $2,461,726 and $0, respectively) $4,864,759,168 $4,045,048,716 -------------------------------------------------------------------------------------
* Unaudited. The accompanying notes are an integral part of these financial statements. 21 22 FINANCIAL HIGHLIGHTS* (For a share outstanding throughout the period)
FOR THE PERIOD DECEMBER 1, 1994 APRIL 1, 1994 (COMMENCEMENT OF SIX MONTHS (COMMENCEMENT OPERATIONS) TO ENDED OF OPERATIONS) TO JANUARY 31 JANUARY 31 JULY 31 --------------------------------------------------------- 1995 1994 --------------------------------------------------------- Class M Class Y - -------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, BEGINNING OF PERIOD $11.79 $11.22 $11.24 - -------------------------------------------------------------------------------------------------------------------------- INVESTMENT OPERATIONS: - -------------------------------------------------------------------------------------------------------------------------- Net Investment Income (Loss) -- .02 -- - -------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss) on Investments .26 .86 (.02) - -------------------------------------------------------------------------------------------------------------------------- TOTAL FROM INVESTMENT OPERATIONS .26 .88 (.02) - -------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS FROM: - -------------------------------------------------------------------------------------------------------------------------- Net Investment Income -- -- -- - -------------------------------------------------------------------------------------------------------------------------- Net Realized Gain on Investments (.51) (.51) -- - -------------------------------------------------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS (.51) (.51) -- - -------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, END OF PERIOD $11.54 $11.59 $11.22 - -------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENT RETURN AT NET ASSET VALUE (%) (b) 2.32(c) 7.98(c) (.18)(c) - -------------------------------------------------------------------------------------------------------------------------- NET ASSETS, END OF PERIOD (in thousands) $908 $115,461 $82,102 - -------------------------------------------------------------------------------------------------------------------------- Ratio of Interest Expense to Average Net Assets (%) -- -- -- - -------------------------------------------------------------------------------------------------------------------------- Ratio of Other Operating Expenses to Average Net Assets (%) .26(c) .51(c) .31(c) - -------------------------------------------------------------------------------------------------------------------------- Ratio of Total Expenses to Average Net Assets (%) .26(c) .51(c) .31(c) - -------------------------------------------------------------------------------------------------------------------------- Ratio of Net Investment Income (Loss) to Average Net Assets (%) (.08)(c) .19(c) (.05)(c) - -------------------------------------------------------------------------------------------------------------------------- Portfolio Turnover (%) 61.29 61.29 57.74 - --------------------------------------------------------------------------------------------------------------------------
22 23
APRIL 27, 1992** SIX MONTHS (COMMENCEMENT ENDED OF OPERATIONS) TO JANUARY 31 YEAR ENDED JULY 31 JULY 31 -------------------------------------------------------------- 1995 1994 1993 1992 -------------------------------------------------------------- Class B - --------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, BEGINNING OF PERIOD $10.97 $10.89 $9.63 $9.34 - --------------------------------------------------------------------------------------------------------------------------------- Investment Operations: - --------------------------------------------------------------------------------------------------------------------------------- Net Investment Income (Loss) (.04) (.05) (.03) (.04) - --------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss) on Investments .84 .59 1.81 .33 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL FROM INVESTMENT OPERATIONS .80 .54 1.78 .29 - --------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS FROM: - --------------------------------------------------------------------------------------------------------------------------------- Net Investment Income -- -- -- -- - --------------------------------------------------------------------------------------------------------------------------------- Net Realized Gain on Investments (.51) (.46) (.52) -- - --------------------------------------------------------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS (.51) (.46) (.52) -- - --------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, END OF PERIOD $11.26 $10.97 $10.89 $9.63 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENT RETURN AT NET ASSET VALUE (%) (b) 7.42(c) 4.71 18.79 3.11(c) - --------------------------------------------------------------------------------------------------------------------------------- NET ASSETS, END OF PERIOD (in thousands) $1,195,477 $911,069 $408,361 $42,492 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Interest Expense to Average Net Assets (%) -- -- -- -- - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Other Operating Expenses to Average Net Assets (%) .92(c) 1.84 1.87 .63(c) - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Total Expenses to Average Net Assets (%) .92(c) 1.84 1.87 .63(c) - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Net Investment Income (Loss) to Average Net Assets (%) (.35)(c) (.91) (.91) (.39)(c) - --------------------------------------------------------------------------------------------------------------------------------- Portfolio Turnover (%) 61.29 57.74 64.62 44.17 - ---------------------------------------------------------------------------------------------------------------------------------
* Table has been restated to reflect a 3-for-1 share split declared by the fund to shareholders of record on October 27, 1989. ** Per share net investment income has been determined on the basis of weighted average number of shares outstanding during the period. (a) Reflects an expense limitation during the year ended July 31, 1988. As a result of such limitation, expenses reflect a reduction of less than $0.01 per share. (b) Total investment return assumes dividend reinvestment and does not reflect the effect of sales charges. (c) Not annualized. 23 24 FINANCIAL HIGHLIGHTS* (Continued)
Six months ended January 31 ---------- 1995 1994 1993 1992 1991 - --------------------------------------------------------------------------------------------------------------------------------- Class A - --------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, BEGINNING OF PERIOD $11.19 $11.02 $9.67 $9.00 $7.98 - --------------------------------------------------------------------------------------------------------------------------------- INVESTMENT OPERATIONS - --------------------------------------------------------------------------------------------------------------------------------- Net Investment Income (Loss) -- (.02) (.02) .02 .02 - --------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss) on Investments .87 .65 1.89 1.16 1.70 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL FROM INVESTMENT OPERATIONS .87 .63 1.87 1.18 1.72 - --------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS FROM: - --------------------------------------------------------------------------------------------------------------------------------- Net Investment Income -- -- -- (.03) (.07) - --------------------------------------------------------------------------------------------------------------------------------- Net Realized Gain on Investments (.51) (.46) (.52) (.48) (.63) - --------------------------------------------------------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS (.51) (.46) (.52) (.51) (.70) - --------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, END OF PERIOD $11.55 $11.19 $11.02 $9.67 $9.00 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENT RETURN AT NET ASSET VALUE (%) (b) 7.90(c) 5.49 19.69 13.39 24.04 - --------------------------------------------------------------------------------------------------------------------------------- NET ASSETS, END OF PERIOD (in thousands) $3,552,912 $3,051,878 $2,403,332 $1,549,128 $1,016,539 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Interest Expense to Average Net Assets (%) -- -- -- -- -- - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Other Operating Expenses to Average Net Assets (%) .54(c) 1.10 1.12 1.20 1.10 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Total Expenses to Average Net Assets (%) .54(c) 1.10 1.12 1.20 1.10 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of Net Investment Income (Loss) to Average Net Assets (%) .03(c) (.18) (.14) .27 .29 - --------------------------------------------------------------------------------------------------------------------------------- Portfolio Turnover (%) 61.29 57.74 64.62 44.17 49.43 - ---------------------------------------------------------------------------------------------------------------------------------
24 25
1990 1989 1988 1987 1986 1985 - -------------------------------------------------------------------------------------------------------------------------------- Class A - -------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, BEGINNING OF PERIOD $ 8.51 $6.56 $8.71 $7.43 $6.05 $4.77 - -------------------------------------------------------------------------------------------------------------------------------- INVESTMENT OPERATIONS - -------------------------------------------------------------------------------------------------------------------------------- Net Investment Income (Loss) .09 .08 .04(a) .02 .04 .05 - -------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss) on Investments .28 2.02 (.84) 2.22 1.71 1.64 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL FROM INVESTMENT OPERATIONS .37 2.10 (.80) 2.24 1.75 1.69 - -------------------------------------------------------------------------------------------------------------------------------- LESS DISTRIBUTIONS FROM: - -------------------------------------------------------------------------------------------------------------------------------- Net Investment Income (.10) (.02) (.03) (.05) (.05) (.05) - -------------------------------------------------------------------------------------------------------------------------------- Net Realized Gain on Investments (.80) (.13) (1.32) (.91) (.32) (.36) - -------------------------------------------------------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS (.90) (.15) (1.35) (.96) (.37) (.41) - -------------------------------------------------------------------------------------------------------------------------------- NET ASSET VALUE, END OF PERIOD $ 7.98 $8.51 $6.56 $8.71 $7.43 $6.05 - -------------------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENT RETURN AT NET ASSET VALUE (%) (b) 4.80 32.59 (10.26) 35.71 31.33 37.12 - -------------------------------------------------------------------------------------------------------------------------------- NET ASSETS, END OF PERIOD (in thousands) $755 ,550 $697,248 $549,799 $610,966 $378,532 $282,868 - -------------------------------------------------------------------------------------------------------------------------------- Ratio of Interest Expense to Average Net Assets (%) -- -- -- .19 .01 .06 - -------------------------------------------------------------------------------------------------------------------------------- Ratio of Other Operating Expenses to Average Net Assets (%) .97 1.00 1.05(a) 1.01 .88 .96 - -------------------------------------------------------------------------------------------------------------------------------- Ratio of Total Expenses to Average Net Assets (%) .97 1.00 1.05(a) 1.20 .89 1.02 - -------------------------------------------------------------------------------------------------------------------------------- Ratio of Net Investment Income (Loss) to Average Net Assets (%) 1.10 1.04 .68(a) .41 .72 .99 - -------------------------------------------------------------------------------------------------------------------------------- Portfolio Turnover (%) 61.71 70.87 65.75 79.10 75.57 60.29 - --------------------------------------------------------------------------------------------------------------------------------
* Table has been restated to reflect a 3-for-1 share split declared by the fund to shareholders of record on October 27, 1989. ** Per share net investment income has been determined on the basis of weighted average number of shares outstanding during the period. (a) Reflects an expense limitation during the year ended July 31, 1988. As a result of such limitation, expenses reflect a reduction of less than $0.01 per share. (b) Total investment return assumes dividend reinvestment and does not reflect the effect of sales charges. (c) Not annualized. 25 26 NOTES TO FINANCIAL STATEMENTS January 31, 1995 NOTE 1 SIGNIFICANT ACCOUNTING POLICIES The fund is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The fund invests primarily in common stocks of companies that Putnam Investment Management, Inc. ("Putnam Management"), the fund's Manager, a wholly-owned subsidiary of Putnam Investments, Inc., believes have potential for capital appreciation significantly greater than that of the market averages. The fund offers class A, class B, class M and class Y shares. The fund commenced its public offering of class M shares on December 1, 1994. Class A shares are sold with a maximum front-end sales charge of 5.75%. Class B shares do not pay a front-end sales charge, but pay a higher ongoing distribution fee than Class A shares, and may be subject to a contingent deferred sales charge, if those shares are redeemed within six years of purchase. Class M shares are sold with a maximum front-end sales charge of 3.50% and pay an ongoing distribution fee that is lower than class B shares and higher than class A shares. Class Y shares, which do not pay a front end or contingent deferred sales charge are generally subject to the same expenses as class A, B and M shares, but do not bear a distribution fee. Class Y shares are sold only to defined contribution plans with an initial investment of at least $250 million in a combination of Putnam funds and other investments managed by Putnam. Expenses of the fund are borne pro-rata by the holders of both classes of shares, except that each class bears expenses unique to that class including the distribution fees applicable to such class. Each class votes only with respect to its own distribution plan or other matters on which a class vote is required by law or determined by the Trustees. Shares of each class would receive their pro-rata share of the net assets of the fund, if the fund were liquidated. In addition, the Trustees declare separate dividends on each class of shares. The following is a summary of significant accounting policies consistently followed by the fund in the preparation of its financial statements. The policies are in conformity with generally accepted accounting principles. A SECURITY VALUATION Investments for which market quotations are readily available are stated at market value, which is determined using the last reported sale price, or, if no sales are reported -- as in the case of some securities traded over the counter -- the last reported bid price, except that certain U.S. government obligations are stated at the mean between the bid and asked prices. Short-term investments having remaining maturities of 60 days or less are stated at amortized cost which approximates market, and other investments are stated at fair value following procedures approved by the Trustees. B JOINT TRADING ACCOUNT Pursuant to an exemptive order issued by the Securities and Exchange Commission, the fund may transfer uninvested cash balances into a joint trading account, along with the cash of other registered investment companies managed by Putnam Management and certain other accounts. These balances may be 26 27 invested in one or more repurchase agreements and/or short-term money market instruments. C REPURCHASE AGREEMENTS The fund, through its custodian, receives delivery of the underlying securities, the market value of which at the time of purchase is required to be in an amount at least equal to the resale price, including accrued interest. The fund's Manager is responsible for determining that the value of these underlying securities is at all times at least equal to the resale price, including accrued interest. D SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Interest income is recorded on the accrual basis and dividend income is recorded on the ex-dividend date, except that certain dividends from foreign securities are recorded as soon as the fund is informed of the ex-dividend date. Foreign currency denominated receivables and payables are "marked-to-market" using the current exchange rate. The fluctuation between the original exchange rate and the current exchange rate is recorded as unrealized gain or loss. Upon receipt of payment, the funds realize a gain or loss on foreign currency amounting to the difference between the original value and the ending value of the receivable or payable. E FEDERAL TAXES It is the policy of the fund to distribute all of its taxable income within the prescribed time and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. It is also the intention of the fund to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Internal Revenue Code of 1986. Therefore, no provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held and for excise tax on income and capital gains. F DISTRIBUTIONS TO SHAREHOLDERS Distributions to shareholders are recorded by the fund on the ex-dividend date. The amount and character of income and gains to be distributed are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. Reclassifications are made to the fund's capital accounts to reflect income and gains available for distribution (or available capital loss carryovers) under income tax regulations. NOTE 2 MANAGEMENT FEE, ADMINISTRATIVE SERVICES, AND OTHER TRANSACTIONS Compensation of Putnam Management, for management and investment advisory services is paid quarterly based on the average net assets of the fund for the quarter. Such fee is based on the following annual rates: 0.70% of the first $500 million of average net assets, 0.60% of the next $500 million, 0.55% of the next $500 million, and 0.50% of any amount over $1.5 billion, subject to reduction in any year to the extent that expenses (exclusive of brokerage, interest, taxes, distribution fees, credits allowed by PFTC and extraordinary expenses) of the fund exceed 2.5% of the first $30 million of average net assets, 2.0% of the next $70 million and 1.5% of any amount over $100 million, and by the amount of certain brokerage commissions and fees (less expenses) received by affiliates of the Manager on the fund's portfolio transactions. The fund also reimburses the Manager for the compensation and related expenses of certain officers of the fund and their staff who provide administrative services to the fund. The aggregate amount of all such reimbursements is determined annually by the Trustees. Trustees of the fund receive an annual Trustee's fee of $5,650, and an additional fee for each Trustees' meeting attended. Trustees who are not inter- 27 28 ested persons of the Manager and who serve on committees of the Trustees receive additional fees for attendance at certain committee meetings. Custodial functions for the fund's assets are provided by Putnam Fiduciary Trust Company (PFTC), a subsidiary of Putnam Investments, Inc. Investor servicing agent functions are provided to the fund by Putnam Investor Services, a division of PFTC. Investor servicing and custodian fees reported in the Statement of operations for the six months ended January 31, 1995 have been reduced by credits allowed by PFTC. The fund has adopted a distribution plan with respect to its class A shares (the "Class A Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940. The purpose of the Class A Plan is to compensate Putnam Mutual Funds Corp., a wholly-owned subsidiary of Putnam Investments Inc., for services provided and expenses incurred by it in distributing class A shares. The Trustees have approved payment by the fund to Putnam Mutual Funds Corp., at an annual rate of 0.25% of the fund's average net assets attributable to class A shares. During the six months ended January 31, 1995, Putnam Mutual Funds Corp., acting as an underwriter, received net commissions of $1,084,997 from the sale of Class A shares of the fund. A deferred sales charge of up to 1% is assessed on certain redemptions of Class A shares purchased as part of an investment of $1 million or more. For the six months ended January 31, 1995, Putnam Mutual Funds Corp., acting as underwriter, received $6,543 on class A redemptions. The fund has adopted a separate distribution plan with respect to its class B shares (the "Class B Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940. The purpose of Class B Plan is to compensate Putnam Mutual Funds Corp. for services provided and expenses incurred by it in distributing class B shares. The Class B Plan provides for payments by the fund to Putnam Mutual Funds Corp. at an annual rate of up to 1.00% of the fund's average net assets attributable to class B shares. Putnam Mutual Funds Corp. also receives the proceeds on the contingent deferred sales charges on its Class B share redemptions within six years of purchase. The charge is based on declining rates, which begin at 5.00% of the net asset value of the redeemed shares. For the six months ended January 31, 1995, Putnam Mutual Funds Corp., acting as an underwriter, received $900,979 in contingent deferred sales charges from redemptions. The fund has adopted a separate distribution plan with respect to its class M shares (the "Class M Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940. The purpose of the Class M Plan is to compensate Putnam Mutual Funds Corp., for services and expenses incurred by it in distributing class M shares. The Trustees have approved payment by the fund to Putnam Mutual Funds Corp., at an annual rate of 0.75% of the fund's average net assets attributable to class M shares. For the period December 1, 1994 (commencement of operations) to January 31, 1995, Putnam Mutual Funds Corp., acting as an underwriter, received net commissions of $3,240 from the sale of class M shares of the fund. NOTE 3 PURCHASES AND SALES OF SECURITIES During the six months ended January 31, 1995, purchases and sales of investment securities other than short-term investments aggregated $2,915,962,847 and $2,578,048,928, respectively. There were no purchases or sales of U.S. government obligations. In determining the net gain or loss on securities sold, the cost of securities has been determined on the identified cost basis. 28 29
NOTE 4 YEAR ENDED JULY 31, 1994 CAPITAL SHARES --------------------------------------------- CLASS B SHARES AMOUNT At January 31, 1995, there was an --------------------------------------------- unlimited number of shares of benefi- Shares sold 54,297,802 $ 622,475,746 cial interest authorized, divided into --------------------------------------------- four classes, class A, class B, class Y Shares issued and class M capital shares. Transactions in connection in capital shares were as follows: with reinvest- ment of distributions 1,839,090 21,241,295 --------------------------------------------- 56,136,892 643,717,041 SIX MONTHS ENDED JANUARY 31, 1995 - --------------------------------------------- Shares CLASS A SHARES AMOUNT repurchased 10,567,655 121,046,605 - --------------------------------------------- --------------------------------------------- Shares sold 61,247,389 $ 719,560,015 Net increase 45,569,237 $ 522,670,436 - --------------------------------------------- --------------------------------------------- Shares issued in connection SIX MONTHS ENDED JANUARY 31, 1995 with reinvest- --------------------------------------------- ment of CLASS Y SHARES AMOUNT distributions 12,419,691 138,976,393 --------------------------------------------- - --------------------------------------------- Shares sold 2,980,509 $ 35,367,593 73,667,080 858,536,408 --------------------------------------------- Shares issued Shares in connection repurchased 38,696,706 455,451,553 with reinvest- - --------------------------------------------- ment of Net increase 34,970,706 $ 403,084,855 distributions 430,218 4,826,994 - --------------------------------------------- --------------------------------------------- 3,410,727 40,194,587 Shares repurchased 764,350 8,978,807 --------------------------------------------- Net increase 2,646,377 $ 31,215,780 YEAR ENDED JULY 31, 1994 --------------------------------------------- - --------------------------------------------- CLASS A SHARES AMOUNT YEAR ENDED JULY 31, 1994 - --------------------------------------------- --------------------------------------------- Shares sold 120,147,917 $1,398,407,256 CLASS Y SHARES AMOUNT - --------------------------------------------- --------------------------------------------- Shares issued Shares sold 7,360,249 $ 82,242,284 in connection --------------------------------------------- with reinvest- Shares issued ment of in connection distributions 8,467,321 99,321,439 with reinvest- - --------------------------------------------- ment of 128,615,238 1,497,728,695 distributions -- -- --------------------------------------------- Shares 7,360,249 82,242,284 repurchased 73,942,159 860,942,051 - --------------------------------------------- Shares Net increase 54,673,079 $ 636,786,644 repurchased 40,272 446,214 - --------------------------------------------- --------------------------------------------- Net increase 7,319,977 $ 81,796,070 SIX MONTHS ENDED JANUARY 31, 1995 --------------------------------------------- - --------------------------------------------- CLASS B SHARES AMOUNT DECEMBER 1, 1994 (COMMENCEMENT - --------------------------------------------- OF OPERATIONS) TO JANUARY 31, 1995 Shares sold 26,626,513 $ 306,213,717 --------------------------------------------- - --------------------------------------------- CLASS M SHARES AMOUNT Shares issued --------------------------------------------- in connection Shares sold 82,174 $ 952,640 with reinvest- --------------------------------------------- ment of Shares issued distributions 4,230,669 46,198,903 in connection - --------------------------------------------- with reinvest- 30,857,182 352,412,620 ment of distributions 1,112 12,448 Shares --------------------------------------------- repurchased 7,774,922 89,204,741 83,266 965,088 - --------------------------------------------- Net increase 23,082,260 $ 263,207,889 Shares - --------------------------------------------- repurchased 4,620 52,738 --------------------------------------------- Net increase 78,666 $ 912,350 ---------------------------------------------
29 30 OUR COMMITMENT TO QUALITY SERVICE CHOOSE AWARD-WINNING SERVICE. Putnam Investor Services has won the DALBAR Quality Tested Service Seal for the past five years. The award is presented annually by DALBAR Financial Services, an independent firm that monitors and evaluates the quality of service provided by mutual fund companies throughout the United States. DALBAR ranks firms by conducting 12,000 anonymous performance evaluations based on 38 service components. HELP YOUR INVESTMENT GROW. Set up a systematic program for investing with as little as $25 a month from a Putnam fund or from your checking or savings account.* SWITCH FUNDS EASILY. You can move money from one account to another with the same class of shares without a service charge. (This privilege is subject to change or termination.) ACCESS YOUR MONEY QUICKLY. You can get checks sent regularly or redeem shares any business day at the then-current net asset value, which may be more or less than their original cost. For details about any of these or other services, contact your financial advisor or call the toll-free number shown below and speak with a helpful Putnam representative. To make an additional investment in this or any other Putnam fund, contact your financial advisor or call our toll-free number: 1-800-225-1581. * Regular investing, of course, does not guarantee a profit or protect against a loss in a declining market. Investors should consider their ability to continue purchasing shares during periods of low price levels. 30 31 FUND INFORMATION INVESTMENT MANAGER Lawrence J. Lasser Putnam Investment Management, Inc. Vice President One Post Office Square Boston, MA 02109 Gordon H. Silver Vice President MARKETING SERVICES Putnam Mutual Funds Corp. Matthew Weatherbie One Post Office Square Vice President and Fund Manager Boston, MA 02109 Charles H. Swanberg CUSTODIAN Vice President and Fund Manager Putnam Fiduciary Trust Company Robert R. Beck LEGAL COUNSEL Vice President and Fund Manager Ropes & Gray William N. Shiebler TRUSTEES Vice President George Putnam, Chairman William F. Pounds, Vice Chairman John R. Verani Jameson Adkins Baxter Vice President Hans H. Estin John A. Hill Paul M. O'Neil Elizabeth T. Kennan Vice President Lawrence J. Lasser Robert E. Patterson John D. Hughes Donald S. Perkins Vice President and Treasurer George Putnam, III A.J.C. Smith Beverly Marcus W. Nicholas Thorndike Clerk and Assistant Treasurer OFFICERS This report is for the information of George Putnam shareholders of Putnam Voyager Fund. President It may also be used as sales literature when preceded or accompanied by the Charles E. Porter current prospectus, which gives details Executive Vice President of sales charges, investment objectives, and operating policies of the fund and Patricia C.Flaherty the most recent copy of Putnam's Senior Vice President Quarterly Performance Summary. For more information or to request a prospectus, call toll free 1-800-225-1581. Shares of mutual funds are not deposits or obligations of, or guaran- teed or endorsed by, any financial institution, are not insured by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board or any other agency, and involve risk, including the possible loss of principal amount invested.
31 32 PUTNAM INVESTMENTS Bulk Rate U.S. Postage The Putnam Funds PAID One Post Office Square Putnam Boston, Massachusetts 02109 Investments -----END PRIVACY-ENHANCED MESSAGE-----