N-CSRS 1 c85435nvcsrs.txt SEMIANNUAL REPORT DATED APRIL 30, 2004 ------------------------- OMB APPROVAL ------------------------- OMB Number: 3235-0570 Expires: October 31, 2006 Estimated average burden hours per response: 19.3 ------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-6362 Van Kampen Municipal Trust --------------------------------------------------------------------------- (Exact name of registrant as specified in charter) 1221 Avenue of the Americas, New York, New York 10020 --------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Ronald Robison 1221 Avenue of the Americas, New York, New York 10020 --------------------------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: 212-762-4000 Date of fiscal year end: 10/31 Date of reporting period: 4/30/04 Item 1. Report to Shareholders The Trust's semi-annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows: Welcome, Shareholder In this report, you'll learn about how your investment in Van Kampen Municipal Trust performed during the semi-annual period. The portfolio management team will provide an overview of the market conditions and discuss some of the factors that affected investment performance during the reporting period. In addition, this report includes the trust's financial statements and a list of trust investments as of April 30, 2004. Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the trust will achieve its investment objective. Trusts are subject to market risk, which is the possibility that the market values of securities owned by the trust will decline and that the value of the trust shares may therefore be less than what you paid for them. Accordingly, you can lose money investing in this trust. Income may subject certain individuals to the federal Alternative Minimum Tax (AMT).
--------------------------------------------------------------------------------------- NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE --------------------------------------------------------------------------------------- NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT ---------------------------------------------------------------------------------------
Performance Summary as of 4/30/04
MUNICIPAL TRUST SYMBOL: VKQ ------------------------------------------------------ AVERAGE ANNUAL BASED ON BASED ON TOTAL RETURNS NAV MARKET PRICE Since Inception (09/27/91) 7.49% 6.34% 10-year 7.33 6.20 5-year 5.89 3.70 1-year 2.83 -1.64 6-month 1.16 -1.57 ------------------------------------------------------
Past performance is no guarantee of future results. Investment return, net asset value (NAV) and common share market price will fluctuate and trust shares, when sold, may be worth more or less than their original cost. As a result of recent market activity, current performance may vary from the figures shown. For more up-to-date information, please visit vankampen.com or speak with your financial advisor. NAV per share is determined by dividing the value of the trust's portfolio securities, cash and other assets, less all liabilities, by the total number of common shares outstanding. The common share market price is the price the market is willing to pay for shares of the trust at a given time. Common share market price is influenced by a range of factors, including supply and demand and market conditions. Total return assumes an investment at the beginning of the period, reinvestment of all distributions for the period in accordance with the trust's dividend reinvestment plan, and sale of all shares at the end of the period. The Lehman Brothers Municipal Bond Index is a broad-based statistical composite of municipal bonds. The index is unmanaged and does not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index. 1 Trust Report FOR THE SIX-MONTH PERIOD ENDED APRIL 30, 2004 Van Kampen Municipal Trust is managed by the adviser's Municipal Fixed Income team.(1) Current members include Thomas Byron, Vice President; Robert Wimmel, Vice President; and John Reynoldson, Executive Director. MARKET CONDITIONS The state of the U.S. economy remained mixed over the six-month period under review. On the positive side, economic growth continued to be robust, with Gross Domestic Product growth topping 4 percent in both the last quarter of 2003 and, preliminarily, the first quarter of this year. While this strength in output has historically triggered fears of rising interest rates, yields remained stubbornly low across the municipal curve. These low yields were partly the result of the continued low levels of observed inflation in the U.S. economy. Unfortunately, they also reflected continuing weakness in the job market, which remained soft throughout the period. The soft job numbers, coupled with persistently low inflation, led the Federal Open Market Committee (the Fed) to maintain its accommodative stance throughout the period. The surprisingly rapid job growth data released in April, coupled with rapidly rising commodity and high oil prices, led many investors to fear that the Fed would be forced to raise interest rates earlier than the market initially expected. As a result, bond yields across all major sectors spiked in April. Supply of new municipal bonds in calendar 2003 hit record levels as municipalities moved to take advantage of historically low interest rates. Many cities and states sought to reduce expenditures by refinancing existing debt and replacing it with lower-yielding bonds. In other cases, municipalities attempted to meet current and future funding needs by issuing new debt. This activity slowed in the first months of 2004. The low interest rates that prevailed over much of the period also had an impact on the demand for municipal bonds. Retail and institutional investor activity slowed as holders of municipal bonds saw little reason to sell bonds purchased at higher yield levels and reinvest at lower yields. However, the period was marked by rising activity among non-traditional investors, such as hedge funds and insurance companies seeking to take advantage of the attractiveness of municipal bonds relative to some taxable securities. Additionally, investors' search for yield led to significant outperformance by lower-rated bonds with greater credit risk. Sectors such as health care, with a preponderance of lower-rated issues, performed particularly well. (1)Team members may change without notice at any time. 2 PERFORMANCE ANALYSIS Closed-end fund returns can be calculated based upon either the market price or the net asset value (NAV) of its shares. NAV per share is determined by dividing the value of the trust's portfolio securities, cash and other assets, less all liabilities, by the total number of common shares outstanding, while market price reflects the supply and demand for the shares. As a result, the two returns can differ significantly. On both an NAV basis and a market-price basis, the trust underperformed its benchmark, the Lehman Brothers Municipal Bond Index. (See table below.) The trust uses leverage to enhance its dividend to common shareholders. The trust borrows money at short-term rates through the issuance of preferred shares. The proceeds are typically reinvested in longer-term securities, taking advantage of the difference between short- and longer-term rates. As yields rose during the period, the prices of bonds declined. The trust's use of leverage magnified this negative movement, leading to a slightly lower total return at NAV than that of its benchmark, which is not leveraged. Our analysis of the macroeconomic environment, coupled with the levels of interest rates near multi-decade lows, led us to believe that interest rates were more likely to rise than to fall further. As a result, we kept the trust's duration (a measure of interest-rate sensitivity) below that of its benchmark in order to limit the potentially damaging impact of any increase in interest rates. This approach hampered the trust's returns for much of the period as interest rates fell; however, it helped buoy returns when interest rates soared in the final weeks of the period. The trust's performance was also modestly hampered by its bias, relative to the benchmark, toward high-quality securities. Municipal bond investors during the period responded to the improving economy by reducing the yield spreads between higher and lower-rated bonds (yield spreads reflect the premium demanded by investors to buy lower-rated bonds). As a result, lower-quality bonds outperformed. The portfolio had 82.7 percent exposure to bonds rated AA/Aa or higher at the end of the period. We adjusted the portfolio's term structure in anticipation of rising interest rates. Our research showed that the intermediate portion of the curve offered the most promising total-return potential. As a result, we focused our purchases on the 13- to 19-year segment of the curve. Many of the securities we identified TOTAL RETURN FOR THE SIX-MONTH PERIOD ENDED APRIL 30, 2004
---------------------------------------------------------- BASED ON BASED ON LEHMAN BROTHERS NAV MARKET PRICE MUNICIPAL BOND INDEX 1.16% -1.57% 1.19% ----------------------------------------------------------
Past performance is no guarantee of future results. Investment return, net asset value and common share market price will fluctuate and trust shares, when sold, may be worth more or less than their original cost. See Performance Summary for additional performance information and index definition. 3 had the added appeal of premium coupons and 10-year call dates, which served to add income to the portfolio while limiting its interest-rate exposure. The trust's trading activity during the period was well below traditional norms because we wanted to avoid having to reinvest into securities with low yields. That said, we were able to make selective relative-value trades among securities and sectors as they moved into and out of fair value. Some of these acquisitions were funded by the proceeds of housing bonds that were called away by their issuers during the period. In other cases we sold bonds that met their performance objectives and reinvested the cash into securities with more promising total-return characteristics. The trust's portfolio remained well diversified during the period, with its holdings spread across many major municipal bond sectors. We believe this long-standing strategy helps to minimize the risk of over-concentration in any single sector, while also giving the portfolio exposure to as many potential sources of return as possible. The three largest sector exposures at the end of the period were general purpose, public education and health care. As mentioned above, the portfolio's below-market duration served it well in the final weeks of the period, when interest rates rose sharply. While it is impossible to predict how long this trend in rates will hold, we believe that the trust is well positioned to weather further increases in rates. We look forward to becoming more active in seeking attractive structures and relative-value trading opportunities now that rates have moved into a more normal range. TOP 5 SECTORS AS OF 4/30/04 RATINGS ALLOCATION AS OF 4/30/04 General Purpose 19.1% AAA/Aaa 71.0% Public Education 11.5 AA/Aa 11.7 Health Care 10.0 A/A 3.7 Transportation 9.4 BBB/Baa 5.1 Higher Education 8.0 BB/Ba 1.7 B/B 0.1 Non-Rated 6.7
Subject to change daily. Provided for informational purposes only and should not be deemed as a recommendation to buy or sell the securities mentioned or securities in the sectors shown above. All percentages are as a percentage of long-term investments. Securities are classified by sectors that represent broad groupings of related industries. Ratings allocations based upon ratings as issued by Standard and Poor's and Moody's. Van Kampen is a wholly owned subsidiary of a global securities firm which is engaged in a wide range of financial services including, for example, securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services. 4 PROXY VOTING POLICIES AND PROCEDURES A description of the trust's policies and procedures with respect to the voting of proxies relating to the trust's portfolio securities is available without charge, upon request, by calling 1-800-847-2424. This information is also available on the Securities and Exchange Commission's website at http://www.sec.gov. 5 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED)
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- MUNICIPAL BONDS 149.8% ALABAMA 3.7% $1,000 Birmingham Baptist Med Ctr AL Baptist Hlth Sys Ser A........................................... 5.875% 11/15/24 $ 1,047,810 2,695 Gadsden, AL Wts Ser B (AMBAC Insd).............. 5.250 08/01/21 2,844,626 4,000 Jefferson Cnty, AL Swr Rev Cap Impt Wts (Prerefunded @ 08/01/12) (FGIC Insd)............ 5.125 02/01/42 4,365,120 6,215 Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A (Prerefunded @ 02/01/11) (FGIC Insd)............ 5.000 02/01/41 6,795,854 1,735 Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A (Prerefunded @ 02/01/11) (FGIC Insd)............ 5.000 02/01/41 1,907,025 2,000 Jefferson Cnty, AL Wts Ser A (AMBAC Insd)....... 5.000 04/01/09 2,178,300 2,405 Marshall Cnty, AL Hlthcare Ser C................ 6.000 01/01/32 2,501,104 ------------- 21,639,839 ------------- ALASKA 0.2% 1,000 Alaska St Intl Arpt Rev Ser B (AMBAC Insd)...... 5.750 10/01/17 1,107,210 ------------- ARIZONA 0.7% 1,425 Arizona Cap Fac Fin Corp Student Hsg Rev AZ St Univ Proj....................................... 6.250 09/01/32 1,474,162 1,000 Arizona Hlth Fac Auth Hosp John C Lincoln Hlth Network......................................... 6.375 12/01/37 1,031,010 1,750 Arizona Sch Fac Brd Ctf Part Ser A (MBIA Insd)........................................... 5.250 09/01/17 1,870,382 ------------- 4,375,554 ------------- ARKANSAS 0.3% 1,565 Fort Smith, AR Wtr & Swr Rev Ser C (FSA Insd)... 5.000 10/01/21 1,611,543 ------------- CALIFORNIA 13.6% 4,000 Anaheim, CA Pub Fin Auth Lease Rev Cap Apprec Sub Pub Impts Proj C (FSA Insd)................. * 09/01/20 1,716,880 2,500 Anaheim, CA Uni High Sch Dist Ser A (FSA Insd)........................................... 5.000 08/01/25 2,515,775 350 California Hlth Fac Fin Auth Rev Casa De Las Ser A (MBIA Insd)................................... 5.250 08/01/17 368,371 5,500 California St (AMBAC Insd)...................... 5.125 10/01/27 5,516,995 1,250 California St Dept Wtr Res Pwr Ser A............ 6.000 05/01/15 1,382,713 4,000 California St Dept Wtr Res Pwr Ser A (AMBAC Insd)........................................... 5.375 05/01/18 4,285,800 3,705 California St Dept Wtr Res Pwr Ser A (MBIA Insd)........................................... 5.375 05/01/21 3,921,705 2,000 California St Dept Wtr Res Pwr Ser A (MBIA Insd)........................................... 5.375 05/01/22 2,107,920 2,500 California St Pub Wks Brd Lease Rev Dept Corrections Ser E (XLCA Insd)................... 5.000 06/01/18 2,593,175 1,000 California St Pub Wks Brd UCLA Replacement Hosp Ser A (FSA Insd)................................ 5.375 10/01/20 1,059,640
6 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- CALIFORNIA (CONTINUED) $5,000 California St Univ Rev Systemwide Ser A (AMBAC Insd)........................................... 5.000% 11/01/23 $ 5,074,350 2,650 California Statewide Cmnty Dev Auth Ctf Part (Acquired 11/23/99, Cost $2,650,000) (a)........ 7.250 11/01/29 2,716,833 5,000 Contra Costa, CA Home Mtg Fin Auth Home Mtg Rev (Escrowed to Maturity) (MBIA Insd).............. * 09/01/17 2,532,250 1,000 Davis, CA Pub Fac Fin Auth Mace Ranch Area Ser A............................................... 6.600 09/01/25 1,039,180 1,300 Del Mar, CA Race Track Auth Rev Rfdg............ 6.000 08/15/06 1,345,656 18,000 Foothill/Eastern Corridor Agy CA Toll Rd Rev Cap Apprec Rfdg (MBIA Insd)......................... * 01/15/25 5,367,960 27,810 Foothill/Eastern Corridor Agy CA Toll Rd Rev Cap Apprec Rfdg..................................... * 01/15/33 4,838,940 6,000 Foothill/Eastern Corridor Agy CA Toll Rd Rev Cap Apprec Sr Lien Ser A (Escrowed to Maturity)..... * 01/01/18 3,110,220 2,240 Huntington Park, CA Redev Agy Rev Tax Alloc Santa Fe Redev Rfdg............................. 6.200 10/01/27 2,305,632 2,635 Imperial Irr Dist CA Ctf Part Elec Sys Proj (FSA Insd)........................................... 5.250 11/01/23 2,723,615 2,000 Los Angeles, CA Uni Sch Dist Ser A (MBIA Insd)........................................... 5.375 07/01/18 2,166,900 4,400 Los Angeles, CA Uni Sch Dist Ser A (MBIA Insd)........................................... 5.250 07/01/19 4,677,728 5,585 Sacramento, CA City Fin Auth Rev Comb Proj B (MBIA Insd)..................................... * 11/01/14 3,430,419 1,375 San Bernadino, CA Jt Pwr Fin Auth Alloc Rev Central City Merged Proj A Rfdg (AMBAC Insd).... 5.750 07/01/20 1,561,491 1,000 Stockton, CA Cmnty Fac Dist Spl Tax No 1-A Mello Roos-Weston Ranch Ser A......................... 5.800 09/01/14 1,045,360 4,000 University, CA Rev Gen Ser A (AMBAC Insd)....... 5.000 05/15/33 3,990,760 5,000 University, CA Rev Gen Ser B (AMBAC Insd)....... 5.000 05/15/20 5,163,300 ------------- 78,559,568 ------------- COLORADO 2.0% 1,000 Colorado Hlth Fac Auth Rev Catholic Hlth Initiatives Ser A............................... 5.500 03/01/32 1,025,820 1,125 Colorado Hlth Fac Auth Rev Hosp Portercare Adventist Hlth.................................. 6.500 11/15/31 1,220,400 2,200 La Plata Cnty, CO Sch Dist 9-R Durango (MBIA Insd)........................................... 5.250 11/01/21 2,306,788 6,365 Platte Riv Pwr Auth CO Pwr Rev Ser EE........... 5.375 06/01/16 6,870,317 ------------- 11,423,325 -------------
See Notes to Financial Statements 7 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- CONNECTICUT 5.5% $7,140 Connecticut St Hlth & Ed Fac Auth Rev Nursing Home Proj AHF/Hartford (Prerefunded @ 11/01/04)....................................... 7.125% 11/01/24 $ 7,493,501 2,840 Connecticut St Spl Oblig Pkg Rev Bradley Intl Arpt Ser A (ACA Insd) (AMT)..................... 6.600 07/01/24 3,048,257 3,450 Connecticut St Spl Tax Oblig Ser B (Prerefunded @ 10/01/04) (FGIC Insd)......................... 6.200 10/01/13 3,556,674 3,540 Mashantucket Western Pequot Tribe CT Spl Rev Ser A, 144A-Private Placement (b)................... 6.400 09/01/11 3,786,880 3,460 Mashantucket Western Pequot Tribe CT Spl Rev Ser A, 144A-Private Placement (Prerefunded @ 09/01/07) (b)................................... 6.400 09/01/11 3,889,005 6,500 Mashantucket Western Pequot Tribe CT Spl Rev Ser B, 144A-Private Placement (b)................... 5.750 09/01/18 6,757,725 3,500 Mashantucket Western Pequot Tribe CT Spl Rev Ser B, 144A-Private Placement (b)................... 5.750 09/01/27 3,564,785 ------------- 32,096,827 ------------- DISTRICT OF COLUMBIA 1.0% 1,000 District of Columbia Hosp Rev Medlantic Hlthcare Group A Rfdg (Escrowed to Maturity) (MBIA Insd)........................................... 5.875 08/15/19 1,096,930 5,000 Metropolitan Washington DC Arpt Auth Sys Ser A (FGIC Insd) (AMT)............................... 5.125 10/01/26 4,966,850 ------------- 6,063,780 ------------- FLORIDA 9.6% 3,380 Brevard Cnty, FL Hlth Fac Hlth First Inc Proj (MBIA Insd)..................................... 5.125 04/01/31 3,392,945 2,550 Broward Cnty, FL Wtr & Swr Util Rfdg (MBIA Insd)........................................... 5.000 10/01/20 2,639,990 3,040 Escambia Cnty, FL Hlth Fac Auth Rev (AMBAC Insd)........................................... 5.950 07/01/20 3,175,706 1,000 Florida St Brd Ed Lottery Rev Ser A (FGIC Insd)........................................... 5.750 07/01/11 1,127,450 3,000 Florida St Dept Environmental Protection Preservation Rev Ser A (FGIC Insd).............. 5.750 07/01/10 3,402,630 1,895 Gulf Breeze, FL Rev Loc Govt (Variable Rate Coupon) (FGIC Insd)............................. 5.625 12/01/20 2,043,568 1,155 Gulf Breeze, FL Rev Venice Loc Govt (FGIC Insd) (c)............................................. 5.050 12/01/20 1,222,810 2,310 Hillsborough Cnty, FL Indl Dev Auth Andl Dev Rev Hlth Fac Proj Univ Cmnty Hosp Ser A............. 5.500 08/15/14 2,380,178 1,000 Hillsborough Cnty, FL Indl Dev Auth Indl Dev Rev Univ Cmnty Hosp (MBIA Insd)..................... 5.750 08/15/14 1,031,020 1,000 Hillsborough Cnty, FL Util Jr Lien Rfdg (AMBAC Insd)........................................... 5.000 08/01/06 1,067,130 1,000 Jea, FL Elec Sys Rev Ser 3 Ser A................ 5.500 10/01/41 1,024,420 1,000 Lake Cnty, FL Sch Brd Ctf Part (AMBAC Insd)..... 5.375 07/01/15 1,082,280
8 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- FLORIDA (CONTINUED) $ 265 Lakeland, FL Hosp Sys Rev Lakeland Regl Hlth Sys............................................. 5.500% 11/15/32 $ 266,479 1,515 Miami Beach, FL Stormwtr Rev (FGIC Insd)........ 5.250 09/01/25 1,556,163 1,855 Miami-Dade Cnty, FL Hlth Fac Miami Childrens Hosp Ser A Rfdg (AMBAC Insd).................... 5.000 08/15/20 1,889,540 2,000 Miami-Dade Cnty, FL Aviation Rev Miami Intl Arpt (FGIC Insd) (AMT)............................... 5.375 10/01/25 2,050,100 2,700 Miami-Dade Cnty, FL Aviation Rev Miami Intl Arpt (FGIC Insd) (AMT)............................... 5.375 10/01/32 2,753,703 5,000 Miami-Dade Cnty, FL Aviation Ser A (FSA Insd) (AMT)........................................... 5.125 10/01/35 4,967,300 3,750 Orange Cnty, FL Sch Brd Ctf Part Ser A (AMBAC Insd)........................................... 5.250 08/01/14 4,080,075 4,320 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC Insd)........................................... 5.625 10/01/14 4,797,144 4,300 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC Insd)........................................... 5.500 10/01/31 4,472,086 1,870 Reedy Creek, FL Impt Dist FL Ser A (MBIA Insd)........................................... 5.000 06/01/21 1,932,739 2,140 Reedy Creek, FL Impt Dist FL Ser A Rfdg (AMBAC Insd)........................................... 5.500 06/01/12 2,357,082 1,060 Tallahassee, FL Lease Rev FL St Univ Proj Ser A (MBIA Insd)..................................... 5.500 08/01/18 1,151,966 ------------- 55,864,504 ------------- GEORGIA 3.6% 2,645 Georgia St Ser D................................ 6.000 10/01/05 2,807,853 3,500 Georgia St Ser D................................ 6.000 10/01/06 3,828,545 2,400 Municipal Elec Auth GA Combustion Turbine Proj Ser A (MBIA Insd)............................... 5.250 11/01/14 2,603,088 8,030 Municipal Elec Auth GA Combustion Turbine Proj Ser A (MBIA Insd)............................... 5.250 11/01/18 8,510,997 1,000 Oconee Cnty, GA Indl Dev Auth Oiit Proj (XLCA Insd)........................................... 5.250 07/01/23 1,028,140 2,000 Royston, GA Hosp Auth Hosp Ctf Rev Ty Cobb Hlthcare Sys Inc Rfdg........................... 6.500 07/01/27 1,951,640 ------------- 20,730,263 ------------- HAWAII 0.4% 1,465 Honolulu, HI City & Cnty Ser D (FGIC Insd) (AMT)........................................... 4.700 02/01/08 1,554,746 975 Honolulu, HI City & Cnty Wastewtr Sys Rev Cap Apprec (FGIC Insd).............................. * 07/01/12 686,000 ------------- 2,240,746 -------------
See Notes to Financial Statements 9 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- ILLINOIS 15.3% $3,400 Carol Stream, IL First Mtg Rev Windsor Pk Mnr Proj (Prerefunded @ 12/01/07)................... 7.000% 12/01/13 $ 3,487,890 1,500 Champaign Cnty, IL Cmnty Unit Sch Dist No 116 Urbana Ser C (Prerefunded @ 01/01/10) (FGIC Insd)........................................... * 01/01/16 866,565 1,300 Champaign Cnty, IL Cmnty Unit Sch Dist No 116 Urbana Ser C (Prerefunded @ 01/01/10) (FGIC Insd)........................................... * 01/01/18 664,677 1,285 Chicago, IL Brd Ed (Prerefunded @ 12/01/10) (FGIC Insd)..................................... 6.000 12/01/12 1,483,982 1,400 Chicago, IL Brd Ed Ser A (MBIA Insd)............ 5.500 12/01/28 1,462,174 4,000 Chicago, IL Neighborhoods Alive 21 Pgm Ser A (FGIC Insd)..................................... 5.750 01/01/40 4,238,360 2,500 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third Lien C 2 Rfdg (FSA Insd) (AMT).................. 5.250 01/01/30 2,512,050 5,000 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third Lien Ser A Rfdg (MBIA Insd) (AMT)............... 5.375 01/01/32 5,065,100 1,015 Chicago, IL O'Hare Intl Arpt Rev Second Lien Passenger Fac Ser B (AMBAC Insd)................ 5.500 01/01/16 1,094,079 1,980 Chicago, IL Pk Dist Ser C (FGIC Insd)........... 5.500 01/01/19 2,131,450 2,565 Chicago, IL Proj Ser C Rfdg (FGIC Insd)......... 5.750 01/01/12 2,854,665 1,000 Cook Cnty, IL Cmnty Cons Sch Dist No 64 Park Ridge (FSA Insd)................................ 5.500 12/01/14 1,116,030 1,000 Cook Cnty, IL Ser A (FGIC Insd)................. 5.500 11/15/31 1,038,840 7,765 Du Page Cnty, IL Forest Preserve Dist........... * 11/01/17 4,007,051 5,000 Du Page Cnty, IL Trans Rev (FSA Insd)........... 5.750 01/01/15 5,535,800 4,000 Hodgkins, IL Tax Increment Ser A Rfdg........... 7.625 12/01/13 4,270,960 2,860 Illinois Dev Fin Auth Rev Adventist Hlth Ser A (MBIA Insd) (c)................................. 5.500 11/15/05 3,016,785 2,725 Illinois Dev Fin Auth Rev Cmnty Rehab Providers Fac Ser A....................................... 7.375 07/01/25 2,914,251 2,705 Illinois Dev Fin Auth Rev Loc Govt Pgm Aurora East Sch (MBIA Insd)............................ * 12/01/15 1,556,051 1,565 Illinois Ed Fac Auth Rev DePaul Univ (Prerefunded @ 10/01/10) (AMBAC Insd)........... 5.625 10/01/15 1,784,147 1,740 Illinois Ed Fac Auth Rev Lewis Univ............. 5.900 10/01/14 1,732,553 1,645 Illinois Hlth Fac Auth Rev Evangelical Hosp Ser C Rfdg (Partially prerefunded @ 04/15/02) (FSA Insd)........................................... 6.750 04/15/12 1,947,384 2,500 Illinois St First Ser (MBIA Insd)............... 5.500 12/01/09 2,792,050 1,500 Illinois St First Ser (FGIC Insd)............... 5.375 11/01/14 1,635,795 3,000 Illinois St First Ser (FSA Insd)................ 5.250 12/01/21 3,133,680 4,000 Illinois St Sales Tax Rev....................... 5.000 06/15/23 4,048,920
10 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- ILLINOIS (CONTINUED) $3,440 Kendall Kane & Will Cntys, IL Cmnty Sch Dist No 308 Ser B (FGIC Insd)........................... 5.250% 10/01/19 $ 3,631,367 870 Metropolitan Pier & Expo Auth IL Dedicated St Tax Rev Cap Apprec (Escrowed to Maturity) (FGIC Insd)........................................... * 06/15/14 547,326 3,460 Metropolitan Pier & Expo Auth IL Dedicated St Tax Rev Cap Apprec (Unrefunded Balance) (FGIC Insd)........................................... * 06/15/14 2,170,285 2,675 Metropolitan Pier & Expo Auth IL Dedicated St Tax Rev McCormick Pl Expn Ser A (MBIA Insd)..... 5.250 06/15/42 2,716,489 1,510 Roselle, IL Multi-Family Hsg Rev Waterbury Apts Ser A Rfdg (GNMA Collateralized)................ 7.000 01/01/25 1,555,013 3,060 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill Cap Apprec (FGIC Insd).......................... * 01/01/12 2,208,096 3,505 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill Cap Apprec (FGIC Insd).......................... * 01/01/14 2,243,445 2,010 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill Cap Apprec (FGIC Insd).......................... * 01/01/16 1,143,811 1,415 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill Cap Apprec (FGIC Insd).......................... * 01/01/19 672,097 9,660 Will Cnty, IL Forest Preserve Dist Ser B (FGIC Insd)........................................... * 12/01/16 5,251,273 ------------- 88,530,491 ------------- INDIANA 1.4% 1,000 Allen Cnty, IN Juvenile Justice Ctr First Mtg (AMBAC Insd).................................... 5.500 01/01/18 1,079,740 1,000 Clark Pleasant, IN Cmnty Sch First Mtg (AMBAC Insd)........................................... 5.500 07/15/13 1,100,470 1,580 Indiana Trans Fin Auth Toll Rd Lease Rev Rfdg (AMBAC Insd).................................... 5.375 07/01/09 1,711,551 1,500 Petersburg, IN Pollutn Ctl Rev, IN Pwr & Lt (AMT)........................................... 5.950 12/01/29 1,507,530 2,500 Vigo Cnty, IN Sch Bldg Corp First Mtg Impt & Rfdg (FSA Insd)................................. 5.250 07/10/24 2,565,600 ------------- 7,964,891 ------------- KANSAS 1.1% 3,000 Sedgwick Cnty, KS Uni Sch Dist No 259 Wichita (MBIA Insd)..................................... 6.000 09/01/09 3,422,790 1,395 Wichita, KS Pub Bldg Comm Rev Wichita St Univ Proj Ser L Rfdg (AMBAC Insd).................... 5.000 02/01/15 1,470,470 1,465 Wichita, KS Pub Bldg Comm Rev Wichita St Univ Proj Ser L Rfdg (AMBAC Insd).................... 5.000 02/01/16 1,535,349 ------------- 6,428,609 -------------
See Notes to Financial Statements 11 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- KENTUCKY 2.9% $4,000 Elsmere, KY Indl Dev Rev Courtaulds Pkg Inc Proj Rfdg (Prerefunded @ 04/01/05)................... 6.750% 04/01/10 $ 4,270,080 1,500 Kentucky St Ppty & Bldg Commn Proj No 69 Ser A Rfdg (FSA Insd)................................. 5.500 08/01/11 1,681,935 3,000 Kentucky St Ppty & Bldg Commn Proj No 79 (Prerefunded @ 10/01/13) (MBIA Insd)............ 5.125 10/01/19 3,298,470 3,500 Kentucky St Tpk Auth Econ Dev Revitalization Proj Rfdg (FSA Insd)............................ 5.500 07/01/07 3,835,265 1,000 Kentucky St Tpk Auth Econ Dev Revitalization Proj Rfdg (FSA Insd)............................ 5.625 07/01/14 1,108,560 2,350 Louisville & Jefferson, KY Swr Ser A (MBIA Insd)........................................... 5.500 05/15/15 2,566,529 ------------- 16,760,839 ------------- LOUISIANA 3.1% 5,000 Ernest N Morial New Orleans LA Sr Sub Ser A (AMBAC Insd).................................... 5.250 07/15/21 5,224,200 1,675 Louisiana Loc Govt Envir Fac Pkg Fac Corp Garage Proj Ser A (AMBAC Insd)......................... 5.200 10/01/19 1,758,867 3,000 Louisiana St Ser A (FGIC Insd).................. 5.500 11/15/07 3,309,090 8,209 Louisiana St Univ & Agriculture & Mechanical College Univ Rev Master Lease (Acquired 11/30/98, Cost $8,032,929) (a).................. 5.750 10/30/18 7,683,951 ------------- 17,976,108 ------------- MAINE 0.2% 1,000 Maine Vets Homes, ME Rev (Prerefunded @ 10/01/05)....................................... 7.750 10/01/20 1,101,070 ------------- MARYLAND 1.4% 2,300 Baltimore, MD Cap Apprec Cons Pub Ser A Impt & Rfdg (FGIC Insd)................................ * 10/15/06 2,103,925 1,845 Baltimore, MD Cap Apprec Ser A (Unrefunded Balance) (FGIC Insd)............................ * 10/15/07 1,579,763 1,700 Maryland St Trans Auth Arpt Baltimore/WA Intl Arpt B (AMBAC Insd) (AMT)....................... 5.125 03/01/24 1,718,207 2,365 Northeast, MD Waste Disp Auth Rfdg (AMBAC Insd) (AMT)........................................... 5.500 04/01/16 2,525,442 ------------- 7,927,337 ------------- MASSACHUSETTS 3.8% 1,775 Massachusetts Muni Whsl Elec Co Nuclear Proj 5 (MBIA Insd)..................................... 5.250 07/01/13 1,930,845 1,000 Massachusetts St Cons Ln Ser B (AMBAC Insd)..... 5.000 08/01/22 1,021,260 1,745 Massachusetts St Cons Ln Ser B (Prerefunded @ 05/01/09)....................................... 5.250 05/01/13 1,935,920
12 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- MASSACHUSETTS (CONTINUED) $5,000 Massachusetts St Cons Ln Ser E (Prerefunded @ 01/01/13) (FSA Insd)............................ 5.250% 01/01/20 $ 5,471,050 2,165 Massachusetts St Dev Fin Agy M/Srbc Proj Ser A (MBIA Insd)..................................... 5.125 02/01/34 2,174,721 820 Massachusetts St Dev Fin Agy Rev Boston Architectural Ctr (ACA Insd).................... 6.100 09/01/18 863,099 1,000 Massachusetts St Dev Fin Agy Rev Boston Architectural Ctr (ACA Insd).................... 6.250 09/01/28 1,049,480 1,500 Massachusetts St Fed Hwy Gnt Antic Nt Ser A..... 5.750 06/15/15 1,700,715 3,700 Massachusetts St Hlth & Ed Fac Auth Rev (MBIA Insd)........................................... 5.000 07/01/13 3,792,796 1,000 Massachusetts St Hlth & Ed Fac Auth Rev Partn Hlthcare Sys Ser C.............................. 5.750 07/01/32 1,046,650 825 Massachusetts St Hlth & Ed Fac Auth Rev Winchester Hosp Ser D Rfdg (Connie Lee Insd).... 5.750 07/01/14 846,780 ------------- 21,833,316 ------------- MICHIGAN 3.8% 3,560 Detroit, MI Loc Dev Fin Auth Tax Increment Sr Ser B (Acquired 09/08/97, Cost $3,560,000) (a)............................................. 6.700 05/01/21 3,484,136 900 Detroit, MI Loc Dev Fin Auth Tax Increment Sub Ser C (Acquired 09/08/97, Cost $900,000) (a).... 6.850 05/01/21 863,865 3,860 Detroit, MI Ser A (XLCA Insd)................... 5.250 04/01/21 4,025,941 2,930 Detroit, MI Wtr Supply Sys Rev Sr Lien Ser C Rfdg (MBIA Insd)................................ 5.250 07/01/18 3,121,769 1,180 Hillsdale, MI Hosp Fin Auth Hosp Rev Hillsdale Cmnty Hlth Ctr.................................. 5.750 05/15/18 1,161,238 2,000 Michigan Muni Bd Auth Rev Clean Wtr Rev Fd...... 5.250 10/01/18 2,119,180 500 Michigan St Hosp Fin Auth Rev Hosp Genesys Regl Med Ser A Rfdg (Escrowed to Maturity)........... 5.375 10/01/13 546,965 2,640 Michigan St Hsg Dev Rental Hsg Rev Ser A (MBIA Insd) (AMT)..................................... 5.300 10/01/37 2,646,547 1,500 Michigan St Strategic Fd Detroit Edison Co Proj C Rfdg (XLCA Insd) (AMT)........................ 5.450 12/15/32 1,531,665 2,500 Michigan St Trunk Line Ser A (Prerefunded @ 11/01/11)....................................... 5.500 11/01/15 2,807,775 ------------- 22,309,081 ------------- MISSISSIPPI 0.5% 2,500 Mississippi Bus Fin Corp MS Pollutn Ctl Rev Sys Energy Res Inc Proj............................. 5.875 04/01/22 2,512,475 620 Mississippi Home Corp Single Family Rev Mtg Ser F (GNMA Collateralized) (AMT)................... 7.550 12/01/27 639,381 ------------- 3,151,856 -------------
See Notes to Financial Statements 13 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- MISSOURI 3.0% $1,400 Ellisville, MO Indl Dev Auth Rev Gambrill Gardens Proj Rfdg & Impt........................ 6.100% 06/01/20 $ 1,335,684 1,000 Ellisville, MO Indl Dev Auth Rev Gambrill Gardens Proj Rfdg & Impt........................ 6.200 06/01/29 926,600 1,250 Fulton 54 Trans Corp Hwt Rev MO (AMBAC Insd).... 4.600 09/01/04 1,264,000 1,740 Good Shepherd Nursing Home Dist MO Nursing Home Fac Rev (Prerefunded @ 08/15/05)................ 7.625 08/15/15 1,901,159 1,000 Kearney, MO (AMBAC Insd)........................ 5.500 03/01/16 1,088,330 1,415 Missouri St Hlth & Ed Fac Rev Univ MO Columbia Arena Proj...................................... 5.000 11/01/18 1,466,916 3,085 Missouri St Hwy & Trans Commn Rd Rev Ser A...... 5.250 02/01/07 3,328,962 1,000 Missouri St Hwy & Trans Commn Rd Rev Ser A...... 5.125 02/01/17 1,055,660 2,810 Perry Cnty, MO Nursing Home Rev Rfdg............ 5.900 03/01/28 2,453,776 2,505 St Louis, MO Arpt Rev Cap Impt Prog Ser A (MBIA Insd)........................................... 5.375 07/01/20 2,657,680 ------------- 17,478,767 ------------- NEVADA 0.7% 2,500 Reno, NV Cap Impt Rev (FGIC Insd)............... 5.125 06/01/26 2,524,925 1,500 Reno, NV Sr Lien Retrac Reno Trans Proj (AMBAC Insd)........................................... 5.125 06/01/37 1,503,180 ------------- 4,028,105 ------------- NEW HAMPSHIRE 1.3% 4,800 New Hampshire Higher Ed & Hlth Fac Auth Rev Daniel Webster College Issue.................... 6.300 07/01/29 4,498,368 2,000 New Hampshire Higher Ed & Hlth Fac Auth Rev Riverwoods at Exeter Ser A...................... 6.500 03/01/23 1,957,320 1,000 New Hampshire Hlth & Ed Fac Auth Rev Derryfield Sch............................................. 6.750 07/01/20 983,010 ------------- 7,438,698 ------------- NEW JERSEY 8.3% 4,000 Camden Cnty, NJ Impt Auth Lease Rev Kaighn PT Marine Term Ser A (Asset Gty Insd) (AMT) (d) (e)............................................. 8.000 06/01/27 240,000 1,460 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg (FGIC Insd)........................................... * 03/01/05 1,443,619 1,465 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg (FGIC Insd)........................................... * 03/01/06 1,413,622 1,615 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg (FGIC Insd)........................................... * 03/01/07 1,504,776 1,555 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg (FGIC Insd)........................................... * 03/01/08 1,392,658 25,000 New Jersey Econ Dev Auth St Contract Econ Recovery (MBIA Insd)............................ 5.900 03/15/21 28,698,000
14 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- NEW JERSEY (CONTINUED) $2,825 New Jersey St Ed Fac Auth Higher Ed Cap Impt Ser A (AMBAC Insd).................................. 5.250% 09/01/19 $ 2,989,867 3,500 New Jersey St Tpk Auth Tpk Rev Ser C (FSA Insd)........................................... 6.500 01/01/16 4,160,030 1,000 New Jersey St Trans Corp Capital Grant Antic Nt Ser B (AMBAC Insd).............................. 5.500 02/01/08 1,098,420 3,500 New Jersey St Trans Corp Ctf Fed Trans Admin Grants Ser A (AMBAC Insd)....................... 5.500 09/15/13 3,898,230 1,000 New Jersey St Trans Tr Fd Auth Trans Sys Ser A............................................... 5.750 06/15/18 1,126,770 ------------- 47,965,992 ------------- NEW MEXICO 0.3% 1,500 Jicarilla, NM Apache Nation Adj Ser A (Acquired 10/23/03, Cost $1,514,910) (a).................. 5.000 09/01/18 1,504,110 ------------- NEW YORK 12.4% 1,870 Long Island Pwr Auth, NY Elec Cap Apprec (FSA Insd)........................................... * 06/01/18 964,621 3,000 Metropolitan Trans Auth NY Ser A Rfdg (FGIC Insd)........................................... 5.250 11/15/31 3,073,560 2,500 Nassau Cnty, NY Interim Fin Auth Sales Tax Secured Ser A (Prerefunded @ 11/15/10).......... 5.750 11/15/13 2,852,950 1,000 Nassau Cnty, NY Ser A Rfdg (FGIC Insd).......... 6.000 07/01/10 1,143,250 85 New York City Adj SubSer A-1 (Partially prerefunded @ 08/01/03)......................... 5.750 08/01/12 86,532 2,625 New York City Hlth & Hosp Corp Rev Hlth Sys Ser A (AMBAC Insd).................................. 5.000 02/15/11 2,839,620 7,000 New York City Ser A............................. 6.250 08/01/08 7,639,730 2,000 New York City Ser H (FGIC Insd)................. 6.000 08/01/12 2,286,360 1,000 New York City Ser H............................. 5.750 03/15/13 1,091,490 2,500 New York City Ser I (MBIA Insd)................. 5.000 08/01/17 2,629,925 2,000 New York City Transitional Future Tax Secd Ser C (AMBAC Insd).................................... 5.250 08/01/22 2,095,980 1,545 New York St Dorm Auth Lease Teachers College (FSA Insd)...................................... 5.250 08/15/15 1,654,309 6,800 New York St Dorm Auth Rev City Univ Sys Cons Ser A............................................... 5.625 07/01/16 7,581,388 3,000 New York St Dorm Auth Rev Sch Dist Fin Pgm Ser D (MBIA Insd)..................................... 5.500 10/01/17 3,269,400 4,200 New York St Dorm Auth Rev Secd Hosp N General Hosp Rfdg....................................... 5.750 02/15/19 4,572,666 1,250 New York St Dorm Auth Revs Cons City Univ Sys A (FSA Insd)...................................... 5.750 07/01/13 1,423,663 2,190 New York St Hsg Fin Agy Econ Dev & Hsg Ser A.... 5.250 09/15/20 2,283,294 1,330 New York St Hsg Fin Agy Econ Dev & Hsg Ser A.... 5.000 09/15/22 1,335,586
See Notes to Financial Statements 15 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- NEW YORK (CONTINUED) $4,000 New York St Twy Auth Svc Cntrct Loc Hwy Brdg (Prerefunded @ 04/01/11)........................ 5.250% 04/01/16 $ 4,435,840 3,000 New York, NY City Mun Wtr Fin Ser B............. 5.000 06/15/19 3,117,030 4,824 Plainedge, NY Union Free Sch Dist (Acquired 07/25/97, Cost $4,824,214) (a).................. 6.000 06/01/12 5,075,942 3,000 Triborough Brdg & Tunl Auth Gen Purp Ser A...... 5.000 01/01/27 3,000,750 5,000 Triborough Brdg & Tunl Auth NY Gen Ser B Rfdg... 5.000 11/15/21 5,130,950 2,000 Triborough Brdg & Tunl Auth NY Ser E Rfdg (MBIA Insd)........................................... 5.000 11/15/32 2,000,640 ------------- 71,585,476 ------------- NORTH CAROLINA 5.1% 2,000 Johnston Cnty, NC (FGIC Insd)................... 5.900 03/01/19 2,263,280 7,015 North Carolina Eastern Muni Pwr Agy Pwr Sys Rev Ser A Rfdg (MBIA Insd).......................... 5.500 01/01/05 7,210,368 2,200 North Carolina Eastern Muni Pwr Agy Pwr Sys Rev Ser C (ACA Insd)................................ 5.000 01/01/21 2,174,128 8,300 North Carolina Muni Pwr Agy No 1 Catawba Elec Rev Rfdg (MBIA Insd)............................ 6.000 01/01/12 9,483,746 6,605 North Carolina Muni Pwr Agy Ser A (MBIA Insd)... 5.250 01/01/20 6,940,006 1,315 University, NC Wilmington Rev (AMBAC Insd)...... 5.250 01/01/19 1,396,214 ------------- 29,467,742 ------------- OHIO 6.5% 3,950 Cincinnati, OH City Sch Dist Sch Impt (FSA Insd)........................................... 5.250 06/01/18 4,186,052 2,765 Cleveland-Cuyahoga Cnty, OH Dev Port Auth Rev Cleveland Bond Fd Ser B......................... 5.375 05/15/18 2,612,483 1,000 Cuyahoga Cnty, OH Hosp Fac Rev Canton Inc Proj............................................ 7.500 01/01/30 1,101,400 2,350 Franklin Cnty, OH Convention Fac Auth Tax & Lease Rev Antic Bds Rfdg (AMBAC Insd)........... 5.250 12/01/17 2,506,510 1,200 Franklin Cnty, OH Convention Fac Auth Tax & Lease Rev Antic Bds Rfdg (AMBAC Insd)........... 5.250 12/01/18 1,273,464 4,800 Franklin Cnty, OH Hosp Rev Holy Cross Hlth Sys Ser B Rfdg (MBIA Insd).......................... 5.250 06/01/10 4,909,872 2,000 Lebanon, OH City Sch Dist (FSA Insd)............ 5.500 12/01/16 2,187,160 1,000 Lorain Cnty, OH Hosp Rev Catholic Hlthcare...... 5.375 10/01/30 1,001,290 2,000 Lorain, OH City Sch Dist Classroom Fac Impt (MBIA Insd)..................................... 5.250 12/01/20 2,128,980 1,000 Mahoning Cnty, OH Hosp Fac Forum Hlth Oblig Group Ser A..................................... 6.000 11/15/32 1,041,680 1,520 Miami Univ OH Gen Rcpts Rfdg (AMBAC Insd)....... 5.000 12/01/21 1,566,056 1,580 Montgomery Cnty, OH Hosp Rev Grandview Hosp & Med Cent Rfdg (Escrowed to Maturity)............ 5.375 12/01/05 1,670,739 2,270 Montgomery Cnty, OH Hosp Rev Kettering Med Cent Impt & Rfdg (MBIA Insd)......................... 6.250 04/01/20 2,665,389
16 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- OHIO (CONTINUED) $3,595 Ohio Mun Elec Generation Agy Jt Venture 5 Ctf Ben Int Rfdg (AMBAC Insd)....................... 5.000% 02/15/20 $ 3,697,098 1,000 Ohio St Air Quality Dev Auth Rev JMG Funding Ltd Part Proj Rfdg (AMBAC Insd) (AMT)............... 6.375 04/01/29 1,036,640 2,500 Ohio St Bldg Auth St Fac Adult Correction Ser A Rfdg (FSA Insd)................................. 5.500 10/01/12 2,755,475 1,000 Ohio St Higher Ed Cap Fac Ser II A.............. 5.250 12/01/05 1,056,620 ------------- 37,396,908 ------------- OKLAHOMA 1.0% 1,240 Kay Cnty, OK Home Fin Auth Rev Single Family Mtg Ser A Rfdg (Escrowed to Maturity) (AMBAC Insd)........................................... 7.000 11/01/11 1,499,445 1,760 Oklahoma Hsg Fin Agy Single Family Rev Mtg Class B (GNMA Collateralized) (AMT)................... 7.997 08/01/18 1,857,504 2,305 Oklahoma St Cap Impt Auth St (MBIA Insd)........ 5.000 06/01/06 2,450,192 ------------- 5,807,141 ------------- OREGON 2.1% 4,000 Oregon Hlth Sciences Univ Insd Ser A (MBIA Insd)........................................... 5.250 07/01/22 4,173,720 1,500 Oregon St Dept Admin Ser C Rfdg (MBIA Insd)..... 5.250 11/01/17 1,594,680 1,250 Portland, OR Cmnty College Dist Ser B........... 5.250 06/01/12 1,356,300 1,500 Washington Multnomah & Yamhill Cntys, OR Sch Dist No 11 (MBIA Insd).......................... 5.000 06/01/13 1,597,905 3,195 Yamhill Cnty, OR Sch Dist No 029J Newberg (MBIA Insd)........................................... 5.250 06/15/18 3,382,483 ------------- 12,105,088 ------------- PENNSYLVANIA 7.0% 2,500 Allegheny Cnty, PA San Auth Swr (MBIA Insd)..... 5.500 12/01/30 2,613,825 3,850 Greater Latrobe, PA Sch Auth (FGIC Insd)........ 5.250 04/01/16 4,108,335 3,000 Harrisburg, PA Auth Res Gtd Sub Ser D-2 (FSA Insd)........................................... 5.000 12/01/33 3,186,720 210 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.000 12/15/05 209,647 275 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.100 12/15/06 275,707 295 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.250 12/15/07 295,416 210 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.300 12/15/08 210,029 320 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.300 12/15/09 315,309
See Notes to Financial Statements 17 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- PENNSYLVANIA (CONTINUED) $ 240 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg Bible Fellowship Proj A Rfdg.................... 5.400% 12/15/10 $ 234,583 1,650 Montgomery Cnty, PA Indl Dev Auth Retirement Cmnty Rev Adult Cmnty Total Svc Ser B........... 5.625 11/15/12 1,724,366 2,700 Pennsylvania Econ Dev Fin Auth Res Recovery Rev Colver Proj Ser D (AMT)......................... 7.150 12/01/18 2,791,071 1,000 Pennsylvania St Tpk Commn Rev Ser T Rfdg (FGIC Insd)........................................... 5.500 12/01/11 1,124,060 1,000 Philadelphia, PA Auth Indl Dev Philadelphia Arpt Sys Proj Ser A (FGIC Insd) (AMT)................ 5.125 07/01/19 1,021,890 2,600 Philadelphia, PA Auth Indl Ser B (FSA Insd)..... 5.500 10/01/16 2,819,570 3,200 Philadelphia, PA Gas Wks Rev 1998 Gen Ordinance 4th Ser (FSA Insd).............................. 5.250 08/01/19 3,388,480 4,305 Philadelphia, PA Redev Auth Rev Neighborhood Transformation Ser A (FGIC Insd)................ 5.250 04/15/11 4,741,785 1,500 Philadelphia, PA Sch Dist Ser A (FSA Insd)...... 5.750 02/01/12 1,671,165 5,205 Pittsburgh, PA Ser A (AMBAC Insd)............... 5.500 09/01/17 5,543,429 4,000 State Pub Sch Bldg Auth PA Sch Rev Lease Philadelphia Sch Dist Proj (FSA Insd)........... 5.000 06/01/33 3,984,640 ------------- 40,260,027 ------------- RHODE ISLAND 1.6% 2,150 Providence, RI Redev Agy Ctf Part Ser A (Prerefunded @ 09/01/04)........................ 8.000 09/01/24 2,239,397 2,420 Rhode Island St Cons Cap Dev Ln Ser A (Prerefunded @ 08/01/04)........................ 5.000 08/01/12 2,467,456 2,000 Rhode Island St Economic Dev Ser A Rfdg (FSA Insd) (AMT)..................................... 5.000 07/01/20 2,002,240 2,495 Rhode Island St Hlth & Ed Higher Ed Johnson & Wales Rfdg (XLCA Insd).......................... 5.375 04/01/18 2,662,340 ------------- 9,371,433 ------------- SOUTH CAROLINA 0.7% 2,000 Rock Hill, SC Util Sys Rev Comb Ser A Impt & Rfdg (FSA Insd)................................. 5.375 01/01/18 2,156,360 475 Rock Hill, SC Util Sys Rev Comb Ser C Rfdg (FSA Insd)........................................... 5.125 01/01/13 507,832 1,500 South Carolina Jobs Econ Dev Auth Indl Rev Elec & Gas Co Proj Ser A (AMBAC Insd)................ 5.200 11/01/27 1,532,760 ------------- 4,196,952 ------------- TENNESSEE 2.1% 4,000 Johnson City, TN Hlth & Ed Fac Brd Hosp Rev First Mtg Mtn St Hlth Ser A Rfdg (MBIA Insd).... 7.500 07/01/25 4,933,240 2,500 Memphis, TN (Prerefunded @10/01/06)............. 5.250 10/01/14 2,718,175 2,155 Memphis, TN Gen Impt............................ 5.000 05/01/20 2,228,399
18 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- TENNESSEE (CONTINUED) $1,000 Metropolitan Nashville Arpt Auth TN Impt Ser A Rfdg (FGIC Insd)................................ 6.600% 07/01/14 $ 1,161,210 1,205 Tennessee Hsg Dev Agy Home Ownership Pgm 2-A (AMT)........................................... 5.700 07/01/31 1,235,969 ------------- 12,276,993 ------------- TEXAS 9.9% 1,000 Brazos Cnty, TX Hlth Fac Dev Oblig Grp.......... 5.375 01/01/32 992,800 1,350 Cameron Cnty, TX Ctf Oblig (AMBAC Insd)......... 5.750 02/15/14 1,497,380 2,500 Coastal Bend Hlth Fac Dev, TX Ser C (Inverse Fltg) (Escrowed to Maturity) (AMBAC Insd) (f)... 10.578 11/15/13 3,256,525 2,420 Dallas Cnty, TX Cmnty College Dist Rev Fing Sys (AMBAC Insd).................................... 5.375 02/15/16 2,600,847 2,000 Fort Worth, TX Wtr & Swr Rev Impt Rfdg.......... 5.500 02/15/05 2,065,820 5,000 Harris Cnty, TX Flood Ctl Dist Contract B Rfdg............................................ 5.000 10/01/23 5,057,850 1,745 Harris Cnty, TX Perm Impt & Rfdg................ 5.000 10/01/11 1,867,848 3,345 Houston, TX Hotel Occupancy Tax Convtn & Entertnmnt Ser B (AMBAC Insd)................... 5.750 09/01/14 3,741,750 3,000 Houston, TX Indpt Sch Dist Maintenance Tax Nt (FSA Insd)...................................... 5.000 07/15/20 3,080,130 6,790 Houston, TX Indpt Sch Dist Pub Fac Corp Lease Rev Cap Apprec West Side Ser B (AMBAC Insd)..... * 09/15/14 4,193,232 1,500 Houston, TX Pub Impt Rfdg (FSA Insd)............ 5.750 03/01/15 1,663,785 2,500 Houston, TX Wtr & Swr Sys Rev Jr Lien Ser B Rfdg (FGIC Insd)..................................... 6.250 12/01/05 2,676,450 1,250 Matagorda Cnty, TX Navig Dist No 1 Rev Coll Centerpoint Energy Proj Rfdg.................... 5.600 03/01/27 1,248,775 1,000 Mesquite, TX Hlth Fac Dev Christian Care Retirement Fac Ser A............................ 7.625 02/15/28 1,044,790 1,400 Metropolitan Hlth Fac Dev Corp TX Wilson N Jones Mem Hosp Proj................................... 7.250 01/01/31 1,321,054 1,000 North Central, TX Hlth Fac Dev Hosp Baylor Hlth Care Sys Proj A................................. 5.125 05/15/29 981,990 4,000 North Central, TX Hlth Fac Dev Hosp Childrens Med Ctr Dallas (AMBAC Insd)..................... 5.250 08/15/32 4,065,240 4,085 Region One Ed Svc Cent Sub Tech Fac Proj (Acquired 12/30/97, Cost $4,084,722) (a)........ 6.590 12/15/17 4,104,369 4,000 San Antonio, TX Elec & Gas Rev Sys Rfdg......... 5.375 02/01/18 4,272,240 1,184 Texas Gen Svc Comm Part Int..................... 7.250 08/01/11 1,201,866 75 Texas Muni Pwr Agy Rev (Escrowed to Maturity) (MBIA Insd)..................................... * 09/01/15 44,294
See Notes to Financial Statements 19 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- TEXAS (CONTINUED) $3,925 Texas Muni Pwr Agy Rev (Unrefunded Balance) (MBIA Insd)..................................... * 09/01/15 $ 2,290,002 4,000 Texas St Univ Sys Fin Rev Rfdg (FSA Insd)....... 5.000% 03/15/19 4,108,480 ------------- 57,377,517 ------------- UTAH 0.8% 3,455 Bountiful, UT Hosp Rev South Davis Cmnty Hosp Proj (Prerefunded @ 06/15/04) (Acquired 06/23/92, Cost $3,455,000) (a).................. 9.500 12/15/18 3,594,064 1,000 Utah St Ser B Rfdg.............................. 5.250 07/01/08 1,101,750 ------------- 4,695,814 ------------- VIRGINIA 2.7% 1,320 Fairfax Cnty, VA Ctf Part....................... 5.300 04/15/23 1,360,867 1,500 Henrico Cnty, VA Indl Dev Auth Pub Fac Lease Rev Henrico Cnty Regl Jail Proj (Prerefunded @ 08/01/05)....................................... 6.500 08/01/10 1,623,285 1,500 Henrico Cnty, VA Indl Dev Auth Pub Fac Lease Rev Henrico Cnty Regl Jail Proj (Prerefunded @ 08/01/05)....................................... 7.125 08/01/21 1,634,880 1,630 Richmond, VA (FSA Insd)......................... 5.125 01/15/08 1,775,559 1,340 Richmond, VA (FSA Insd)......................... 5.500 01/15/10 1,499,567 2,155 Virginia Comwlth Trans Brd North VA Trans Dist Pg Ser A........................................ 5.375 05/15/14 2,346,838 5,000 Virginia St Pub Sch Auth Sch Fing 1997 Resolution Ser C................................ 5.000 08/01/20 5,185,250 ------------- 15,426,246 ------------- WASHINGTON 5.6% 5,000 Bellevue, WA Convention Cent Auth Spl Oblig Rev Rfdg (MBIA Insd)................................ * 02/01/24 1,705,500 3,230 Clark Cnty, WA Pub Util Dist No. 001 Gen Sys Rev Rfdg (FSA Insd)................................. 5.500 01/01/07 3,492,954 3,000 Clark Cnty, WA Pub Util Dist No. 001 Gen Sys Rev Rfdg (FSA Insd)................................. 5.625 01/01/12 3,314,070 5,000 Cowlitz Cnty, WA Spl Swr Rev Csob Wastewtr Treatment Rfdg (FGIC Insd)...................... 5.500 11/01/19 5,515,400 5,000 Energy Northwest WA Elec Rev Proj No 3 Ser A Rfdg (XLCA Insd)................................ 5.500 07/01/17 5,440,500 3,000 Energy Northwest WA Elec Rev Proj No 3 Ser A Rfdg (FSA Insd)................................. 5.500 07/01/18 3,235,260 5,000 King Cnty, WA Ser B Rfdg (MBIA Insd)............ 5.250 01/01/34 5,064,400 1,000 Port Seattle, WA Rev Ser B (MBIA Insd) (AMT).... 5.625 02/01/24 1,031,820
20 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE -------------------------------------------------------------------------------------------- WASHINGTON (CONTINUED) $1,345 Tacoma, WA Elec Sys Rev Ser A Rfdg (FSA Insd)... 5.750% 01/01/15 $ 1,489,009 1,750 Washington St Pub Pwr Supply Sys Nuclear Proj No 1 Rev (MBIA Insd)............................... 5.750 07/01/12 1,911,875 ------------- 32,200,788 ------------- WEST VIRGINIA 1.1% 6,550 Harrison Cnty, WV Cnty Cmnty Solid Waste Disp Rev Potomac Edison Co Ser A (MBIA Insd) (AMT)... 6.875 04/15/22 6,575,938 ------------- WISCONSIN 2.2% 5,000 Wisconsin St Hlth & Ed Fac Auth Mercy Hlth Sys Corp (AMBAC Insd)............................... 5.500 08/15/25 5,135,400 7,280 Wisconsin St Hlth & Ed Fac Auth Rev Children's Hosp (Prerefunded @ 08/15/04) (FGIC Insd)....... 5.000 08/15/10 7,443,800 ------------- 12,579,200 ------------- GUAM 0.9% 5,000 Guam Pwr Auth Rev Ser A (AMBAC Insd)............ 5.250 10/01/34 5,112,850 ------------- PUERTO RICO 0.4% 2,000 Puerto Rico Muni Fin Agy Ser A (FSA Insd)....... 5.250 08/01/20 2,133,840 ------------- TOTAL LONG-TERM INVESTMENTS 149.8% (Cost $832,441,673)....................................................... 866,682,382 SHORT-TERM INVESTMENT 0.2% (Cost $1,200,000)......................................................... 1,200,000 ------------- TOTAL INVESTMENTS 150.0% (Cost $833,641,673)....................................................... 867,882,382 OTHER ASSETS IN EXCESS OF LIABILITIES 1.9%................................. 10,825,526 PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (51.9%)................. (300,064,591) ------------- NET ASSETS APPLICABLE TO COMMON SHARES 100.0%.............................. $ 578,643,317 =============
* Zero coupon bond (a) These securities are restricted and may be resold only in transactions exempt from registration which are normally those transactions with qualified institutional buyers. Restricted securities comprise 5.0% of net assets. See Notes to Financial Statements 21 VAN KAMPEN MUNICIPAL TRUST PORTFOLIO OF INVESTMENTS -- APRIL 30, 2004 (UNAUDITED) continued (b) 144A securities are those which are exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may only be resold in transactions exempt from registration which are normally those transactions with qualified institutional buyers. (c) Security converts to a fixed coupon rate at a predetermined date. (d) Issuer has filed for protection in federal bankruptcy court. (e) Non-income producing security. (f) An Inverse Floating Rate security is one where the coupon is inversely indexed to a short-term floating interest rate multiplied by a specific factor. As the floating rate rises, the coupon is reduced. Conversely, as the floating rate declines, the coupon is increased. The price of these securities may be more volatile than the price of a comparable fixed rate security. These instruments are typically used by the Trust to enhance the yield of the portfolio. All of the Trust's portfolio holdings, including derivative instruments, are marked to market each day with the change in value reflected in the unrealized appreciation/depreciation. Upon disposition, a realized gain or loss is recognized accordingly. ACA--American Capital Access AMBAC--AMBAC Indemnity Corp. AMT--Alternative Minimum Tax Asset Gty--Asset Guaranty Insurance Co. Connie Lee--Connie Lee Insurance Co. FGIC--Financial Guaranty Insurance Co. FSA--Financial Security Assurance Inc. GNMA--Government National Mortgage Association MBIA--Municipal Bond Investors Assurance Corp. XLCA--XL Capital Assurance Inc. 22 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST FINANCIAL STATEMENTS Statement of Assets and Liabilities April 30, 2004 (Unaudited) ASSETS: Total Investments (Cost $833,641,673)....................... $867,882,382 Cash........................................................ 137,839 Receivables: Interest.................................................. 11,981,217 Investments Sold.......................................... 2,667,350 Other....................................................... 2,924 ------------ Total Assets............................................ 882,671,712 ------------ LIABILITIES: Payables: Investments Purchased..................................... 2,772,450 Investment Advisory Fee................................... 437,814 Income Distributions--Common Shares....................... 168,191 Other Affiliates.......................................... 56,261 Administrative Fee........................................ 36,485 Trustees' Deferred Compensation and Retirement Plans........ 332,284 Accrued Expenses............................................ 160,319 ------------ Total Liabilities....................................... 3,963,804 Preferred Shares (including accrued distributions).......... 300,064,591 ------------ NET ASSETS APPLICABLE TO COMMON SHARES...................... $578,643,317 ============ NET ASSET VALUE PER COMMON SHARE ($578,643,317 divided by 36,365,393 shares outstanding)............................ $ 15.91 ============ NET ASSETS CONSIST OF: Common Shares ($.01 par value with an unlimited number of shares authorized, 36,365,393 shares issued and outstanding).............................................. $ 363,654 Paid in Surplus............................................. 538,413,497 Net Unrealized Appreciation................................. 34,240,709 Accumulated Undistributed Net Investment Income............. 3,969,747 Accumulated Net Realized Gain............................... 1,655,710 ------------ NET ASSETS APPLICABLE TO COMMON SHARES...................... $578,643,317 ============ PREFERRED SHARES ($.01 par value, authorized 100,000,000 shares, 12,000 issued with liquidation preference of $25,000 per share)........................................ $300,000,000 ============ NET ASSETS INCLUDING PREFERRED SHARES....................... $878,643,317 ============
See Notes to Financial Statements 23 VAN KAMPEN MUNICIPAL TRUST FINANCIAL STATEMENTS continued Statement of Operations For the Six Months Ended April 30, 2004 (Unaudited) INVESTMENT INCOME: Interest.................................................... $ 22,073,760 ------------ EXPENSES: Investment Advisory Fee..................................... 2,692,353 Preferred Share Maintenance................................. 398,568 Administrative Fee.......................................... 224,363 Trustees' Fees and Related Expenses......................... 91,191 Legal....................................................... 57,585 Custody..................................................... 25,379 Other....................................................... 198,918 ------------ Total Expenses.......................................... 3,688,357 ------------ NET INVESTMENT INCOME....................................... $ 18,385,403 ============ REALIZED AND UNREALIZED GAIN/LOSS: Realized Gain/Loss: Investments............................................... $ 1,753,196 Futures................................................... (333,975) ------------ Net Realized Gain........................................... 1,419,221 ------------ Unrealized Appreciation/Depreciation: Beginning of the Period................................... 46,947,631 End of the Period......................................... 34,240,709 ------------ Net Unrealized Depreciation During the Period............... (12,706,922) ------------ NET REALIZED AND UNREALIZED LOSS............................ $(11,287,701) ============ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $ (1,448,847) ============ NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM OPERATIONS................................................ $ 5,648,855 ============
24 See Notes to Financial Statements VAN KAMPEN MUNICIPAL TRUST FINANCIAL STATEMENTS continued Statements of Changes in Net Assets (Unaudited)
FOR THE FOR THE SIX MONTHS ENDED YEAR ENDED APRIL 30, 2004 OCTOBER 31, 2003 ----------------------------------- FROM INVESTMENT ACTIVITIES: Operations: Net Investment Income................................... $ 18,385,403 $ 37,242,943 Net Realized Gain....................................... 1,419,221 2,809,023 Net Unrealized Appreciation/Depreciation During the Period................................................ (12,706,922) 1,757,060 Distributions to Preferred Shareholders: Net Investment Income................................. (1,371,484) (3,055,413) Net Realized Gain..................................... (77,363) -0- ------------ ------------ Change in Net Assets Applicable to Common Shares from Operations............................................ 5,648,855 38,753,613 Distributions to Common Shareholders: Net Investment Income................................. (17,018,202) (34,036,119) Net Realized Gain..................................... (869,098) -0- ------------ ------------ NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM INVESTMENT ACTIVITIES............................ (12,238,445) 4,717,494 NET ASSETS APPLICABLE TO COMMON SHARES: Beginning of the Period................................. 590,881,762 586,164,268 ------------ ------------ End of the Period (Including accumulated undistributed net investment income of $3,969,747 and $3,974,030, respectively)......................................... $578,643,317 $590,881,762 ============ ============
See Notes to Financial Statements 25 VAN KAMPEN MUNICIPAL TRUST FINANCIAL HIGHLIGHTS (UNAUDITED) THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
SIX MONTHS ENDED APRIL 30, ------------------------------ 2004 2003 2002 (a) 2001 ------------------------------------------- NET ASSET VALUE, BEGINNING OF THE PERIOD......... $ 16.25 $ 16.12 $ 16.07 $ 14.91 ------- ------- ------- ------- Net Investment Income.......................... .51 1.02 1.06 1.13 Net Realized and Unrealized Gain/Loss.......... (.32) .13 .01 1.12 Common Share Equivalent of Distributions Paid to Preferred Shareholders: Net Investment Income........................ (.04) (.08) (.11) (.27) Net Realized Gain............................ -0-(f) -0- -0- -0- ------- ------- ------- ------- Total from Investment Operations................. .15 1.07 .96 1.98 Distributions Paid to Common Shareholders: Net Investment Income........................ (.47) (.94) (.91) (.82) Net Realized Gain............................ (.02) -0- -0- -0- ------- ------- ------- ------- NET ASSET VALUE, END OF THE PERIOD............... $ 15.91 $ 16.25 $ 16.12 $ 16.07 ======= ======= ======= ======= Common Share Market Price at End of the Period... $ 13.88 $ 14.57 $ 14.30 $ 13.79 Total Return (b)................................. -1.57%* 8.60% 10.49% 15.97% Net Assets Applicable to Common Shares at End of the Period (In millions)....................... $ 578.6 $ 590.9 $ 586.2 $ 584.4 Ratio of Expenses to Average Net Assets Applicable to Common Shares (c)................ 1.23% 1.23% 1.35% 1.55% Ratio of Net Investment Income to Average Net Assets Applicable to Common Shares (c)......... 6.14% 6.28% 6.70% 7.26% Portfolio Turnover............................... 7%* 24% 38% 28% SUPPLEMENTAL RATIOS: Ratio of Expenses to Average Net Assets Including Preferred Shares (c)........................... .82% .81% .89% 1.01% Ratio of Net Investment Income to Average Net Assets Applicable to Common Shares (d)......... 5.68% 5.77% 5.98% 5.51% SENIOR SECURITIES: Total Preferred Shares Outstanding............... 12,000 12,000 12,000 12,000 Asset Coverage Per Preferred Share (e)........... $73,220 $74,245 $73,861 $73,700 Involuntary Liquidating Preference Per Preferred Share.......................................... $25,000 $25,000 $25,000 $25,000 Average Market Value Per Preferred Share......... $25,000 $25,000 $25,000 $25,000
* Non-Annualized (a)As required, effective November 1, 2001, the Trust has adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began accreting market discount on fixed income securities. The effect of this change for the year ended October 31, 2002 was to increase net investment income per share by $.01, decrease net realized and unrealized gains and losses per share by $.01 and increase the ratio of net investment income to average net assets applicable to common shares from 6.69% to 6.70%. Per share, ratios and supplemental data for periods prior to October 31, 2002 have not been restated to reflect this change in presentation. (b)Total return assumes an investment at the common share market price at the beginning of the period indicated, reinvestment of all distributions for the period in accordance with the Trust's dividend reinvestment plan, and sale of all shares at the closing common share market price at the end of the period indicated. (c)Ratios do not reflect the effect of dividend payments to preferred shareholders. (d)Ratios reflect the effect of dividend payments to preferred shareholders. (e)Calculated by subtracting the Trust's total liabilities (not including the preferred shares) from the Trust's total assets and dividing this by the number of preferred shares outstanding. (f)Amount is less than $0.01 per share. 26
TWO MONTHS YEAR ENDED OCTOBER 31, ENDED YEAR ENDED AUGUST 31, ----------------------- OCTOBER 31, ---------------------------------------------------- 2000 1999 1998 1998 1997 1996 1995 1994 -------------------------------------------------------------------------------------------- $ 14.60 $ 17.39 $ 17.32 $ 16.60 $ 15.84 $ 15.73 $ 15.56 $ 17.04 ------- -------- -------- -------- -------- -------- -------- -------- 1.17 1.20 .21 1.26 1.28 1.30 1.31 1.34 .42 (2.30) .08 .72 .73 .10 .26 (1.42) (.34) (.24) (.02) (.30) (.29) (.30) (.32) (.28) -0- (.06) (.04) -0- -0- -0- -0- -0- ------- -------- -------- -------- -------- -------- -------- -------- 1.25 (1.40) .23 1.68 1.72 1.10 1.25 (.36) (.94) (.96) (.16) (.96) (.96) (.99) (1.08) (1.12) -0- (.43) -0- -0- -0- -0- -0- -0- ------- -------- -------- -------- -------- -------- -------- -------- $ 14.91 $ 14.60 $ 17.39 $ 17.32 $ 16.60 $ 15.84 $ 15.73 $ 15.56 ======= ======== ======== ======== ======== ======== ======== ======== $12.625 $13.1875 $16.8125 $16.1875 $ 15.75 $ 14.50 $ 14.25 $ 15.00 2.80% -14.47% 4.84%* 9.06% 15.87% 8.98% 2.39% -3.94% $ 542.1 $ 530.9 $ 630.6 $ 628.2 $ 601.9 $ 574.6 $ 570.7 $ 564.4 1.67% 1.60% 1.57% 1.57% 1.61% 1.61% 1.65% 1.64% 8.07% 7.43% 7.20% 7.42% 7.86% 8.08% 8.58% 8.23% 39% 80% 6%* 94% 54% 36% 49% 47% 1.07% 1.06% 1.07% 1.06% 1.07% 1.06% 1.07% 1.09% 5.71% 5.95% 6.48% 5.66% 6.04% 6.20% 6.48% 6.52% 12,000 12,000 6,000 6,000 6,000 6,000 6,000 6,000 $70,177 $ 69,241 $155,104 $154,696 $150,322 $145,764 $145,113 $144,074 $25,000 $ 25,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $25,000 $ 25,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000
See Notes to Financial Statements 27 VAN KAMPEN MUNICIPAL TRUST NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2004 (UNAUDITED) 1. SIGNIFICANT ACCOUNTING POLICIES Van Kampen Municipal Trust (the "Trust") is registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended. The Trust's investment objective is to seek to provide a high level of current income exempt from federal income tax, consistent with preservation of capital. The Trust will invest in a portfolio consisting substantially of municipal obligations rated investment grade at the time of investment, but may invest up to 20% of its assets in unrated securities which are believed to be of comparable quality to those rated investment grade. The Trust commenced investment operations on September 27, 1991. Effective November 30, 2003, the Trust's investment adviser, Van Kampen Investment Advisory Corp. merged into its affiliate, Van Kampen Asset Management (the "Adviser"). The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. A. SECURITY VALUATION Municipal bonds are valued by independent pricing services or dealers using the mean of the bid and asked prices or, in the absence of market quotations, at fair value based upon yield data relating to municipal bonds with similar characteristics and general market conditions. Securities which are not valued by independent pricing services or dealers are valued at fair value using procedures established in good faith by the Board of Trustees. Short-term securities with remaining maturities of 60 days or less are valued at amortized cost, which approximates market value. B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date basis. Realized gains and losses are determined on an identified cost basis. The Trust may purchase and sell securities on a "when-issued" or "delayed delivery" basis, with settlement to occur at a later date. The value of the security so purchased is subject to market fluctuations during this period. The Trust will segregate assets with the custodian having an aggregate value at least equal to the amount of the when-issued or delayed delivery purchase commitments until payment is made. At April 30, 2004, the Trust had $2,772,450 of when-issued and delayed delivery purchase commitments. C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond premium is amortized and discount is accreted over the expected life of each applicable security. D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no provision for federal income taxes is required. 28 VAN KAMPEN MUNICIPAL TRUST NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2004 (UNAUDITED) continued At April 30, 2004, the cost and related gross unrealized appreciation and depreciation are as follows: Cost of investments for tax purposes........................ $832,902,653 ============ Gross tax unrealized appreciation........................... $ 42,304,102 Gross tax unrealized depreciation........................... (7,324,373) ------------ Net tax unrealized appreciation on investments.............. $ 34,979,729 ============
E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly dividends from net investment income to common shareholders. Net realized gains, if any, are distributed annually on a pro rata basis to common and preferred shareholders. Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income for tax purposes. The tax character of distributions paid during the year ended October 31, 2003 was as follows:
2003 Distribution paid from: Ordinary Income........................................... $190,906 Long-term capital gain.................................... -0- -------- $190,906 ========
As of October 31, 2003, the components of distributable earnings on a tax basis were as follows: Undistributed ordinary income............................... $65,280 Undistributed long-term capital gain........................ 945,753
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES Under the terms of the Trust's Investment Advisory Agreement, the Adviser provides investment advice and facilities to the Trust for an annual fee payable monthly of .60% of the average daily net assets of the Trust. In addition, the Trust pays a monthly administrative fee to Van Kampen Investments Inc. or its affiliates (collectively "Van Kampen"), the Trust's Administrator, at an annual rate of .05% of the average daily net assets of the Trust. Effective June 1, 2004, the administrative fee was reduced from .05% to .00%. For the six months ended April 30, 2004, the Trust recognized expenses of approximately $36,700 representing legal services provided by Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust is an affiliated person. Under separate Accounting Services and Legal Services agreements, the Adviser provides accounting and legal services to the Trust. The Adviser allocates the cost of such services to each trust. For the six months ended April 30, 2004, the Trust recognized expenses of approximately $39,500 representing Van Kampen's cost of providing accounting and legal services to the Trust, which are reported as part of "Other" and "Legal" expenses, respectively, in the Statement of Operations. 29 VAN KAMPEN MUNICIPAL TRUST NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2004 (UNAUDITED) continued Certain officers and trustees of the Trust are also officers and directors of Van Kampen. The Trust does not compensate its officers or trustees who are officers of Van Kampen. The Trust provides deferred compensation and retirement plans for its trustees who are not officers of Van Kampen. Under the deferred compensation plan, trustees may elect to defer all or a portion of their compensation to a later date. Benefits under the retirement plan are payable upon retirement for a ten-year period and are based upon each trustee's years of service to the Trust. The maximum annual benefit per trustee under the plan is $2,500. 3. INVESTMENT TRANSACTIONS During the period, the cost of purchases and proceeds from sales of investments, excluding short-term investments, were $60,116,170 and $61,101,145, respectively. 4. DERIVATIVE FINANCIAL INSTRUMENTS A derivative financial instrument in very general terms refers to a security whose value is "derived" from the value of an underlying asset, reference rate or index. In order to seek to manage the interest rate exposure of the Trust's portfolio in a changing interest rate environment, the Trust may purchase or sell financial futures contracts or engage in transactions involving interest rate swaps, caps, floors or collars. The Trust expects to enter into these transactions primarily as a hedge against anticipated interest rate or fixed-income market changes, for duration management or for risk management purposes, but may also enter into these transactions to generate additional income. All of the Trust's portfolio holdings, including derivative instruments, are marked to market each day with the change in value reflected in the unrealized appreciation/depreciation. Upon disposition, a realized gain or loss is recognized accordingly, except when taking delivery of a security underlying a futures contract. In this instance, the recognition of gain or loss is postponed until the disposal of the security underlying the futures contract. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their contracts. During the period, the Trust invested in futures contracts, a type of derivative. A futures contract is an agreement involving the delivery of a particular asset on a specified future date at an agreed upon price. The Trust generally invests in exchange traded futures contracts on U.S. Treasury Bonds and Notes and typically closes the contract prior to the delivery date. Futures contracts are valued at the settlement price established each day on the exchange on which they are traded. Upon entering into futures contracts, the Trust maintains an amount of cash or liquid securities with a value equal to a percentage of the contract amount with either a future commission merchant pursuant to rules and regulations promulgated under the 1940 Act, as amended, or with its custodian in an account in the broker's name. This amount is known as initial margin. During the period the futures contract is open, payments are received from or made to the broker based upon changes in the value of the contract (the variation margin). The risk of loss associated with a futures contract is in excess of the variation margin reflected on the Statement of Assets and Liabilities. 30 VAN KAMPEN MUNICIPAL TRUST NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2004 (UNAUDITED) continued Transactions in futures contracts for the six months ended April 30, 2004, were as follows:
CONTRACTS Outstanding at October 31, 2003............................. 98 Futures Closed.............................................. (98) --- Outstanding at April 30, 2004............................... -0- ===
5. PREFERRED SHARES The Trust has outstanding 12,000 Auction Preferred Shares ("APS") in four series of 3,000 shares each. Dividends are cumulative and the dividend rate is periodically reset through an auction process. The dividend periods for Series A and C are generally 7 days. The dividend periods for Series B and D are 28 days. The average rate in effect on April 30, 2004 was 1.035%. During the six months ended April 30, 2004, the rates ranged from 0.590% to 1.410%. The Trust pays annual fees equivalent to .25% of the preferred share liquidation value for the remarketing efforts associated with the preferred auctions. These fees are included as a component of "Preferred Share Maintenance" expense in the Statement of Operations. The APS are redeemable at the option of the Trust in whole or in part at the liquidation value of $25,000 per share plus accumulated and unpaid dividends. The Trust is subject to certain asset coverage tests, and the APS are subject to mandatory redemption if the tests are not met. 31 VAN KAMPEN MUNICIPAL TRUST BOARD OF TRUSTEES AND IMPORTANT ADDRESSES BOARD OF TRUSTEES DAVID C. ARCH J. MILES BRANAGAN JERRY D. CHOATE ROD DAMMEYER LINDA HUTTON HEAGY R. CRAIG KENNEDY HOWARD J KERR MITCHELL M. MERIN* JACK E. NELSON RICHARD F. POWERS, III* HUGO F. SONNENSCHEIN WAYNE W. WHALEN* - Chairman SUZANNE H. WOOLSEY INVESTMENT ADVISER VAN KAMPEN ASSET MANAGEMENT 1221 Avenue of the Americas New York, New York 10020 CUSTODIAN AND TRANSFER AGENT STATE STREET BANK AND TRUST COMPANY c/o EquiServe P.O. Box 43011 Providence, Rhode Island 02940-3011 LEGAL COUNSEL SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 333 West Wacker Drive Chicago, Illinois 60606 INDEPENDENT AUDITORS DELOITTE & TOUCHE LLP 180 North Stetson Avenue Chicago, Illinois 60601 * "Interested persons" of the Trust, as defined in the Investment Company Act of 1940, as amended. 32 Van Kampen Privacy Notice The Van Kampen companies and investment products* respect your right to privacy. We also know that you expect us to conduct and process your business in an accurate and efficient manner. To do so, we must collect and maintain certain nonpublic personal information about you. This is information we collect from you on applications or other forms, and from the transactions you conduct with us, our affiliates, or third parties. We may also collect information you provide when using our Web site, and text files (also known as "cookies") may be placed on your computer to help us to recognize you and to facilitate transactions you initiate. We do not disclose any nonpublic personal information about you or any of our former customers to anyone, except as permitted by law. For instance, so that we may continue to offer you Van Kampen investment products and services that meet your investing needs, and to effect transactions that you request or authorize, we may disclose the information we collect to companies that perform services on our behalf, such as printers and mailers that assist us in the distribution of investor materials. These companies will use this information only for the services for which we hired them, and are not permitted to use or share this information for any other purpose. To protect your nonpublic personal information internally, we permit access to it only by authorized employees, and maintain physical, electronic and procedural safeguards to guard your nonpublic personal information. * Includes Van Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc., Van Kampen Funds Inc., Van Kampen Investor Services Inc., Van Kampen System Inc. and Van Kampen Exchange Corp., as well as the many Van Kampen mutual funds and Van Kampen unit investment trusts. Van Kampen Funds Inc. 1 Parkview Plaza, P.O. Box 5555 Oakbrook Terrace, IL 60181-5555 www.vankampen.com (VAN KAMPEN INVESTMENTS LOGO) Copyright (C)2004 Van Kampen Funds Inc. All rights reserved. Member NASD/SIPC. VKQ SAR 6/04 RN04-00737P-Y04/04 Item 2. Code of Ethics. Not applicable for semi-annual reports. Item 3. Audit Committee Financial Expert. Not applicable for semi-annual reports. Item 4. Principal Accountant Fees and Services. Not applicable for semi-annual reports. Item 5. Audit Committee of Listed Registrants. Not applicable for semi-annual reports. Item 6. [Reserved.] Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. Not applicable. Item 8. [Reserved.] Item 9. Controls and Procedures (a) The Trust's principal executive officer and principal financial officer have concluded that the Trust's disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Trust in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 10. Exhibits. (a) Code of Ethics -- Not applicable for semi-annual reports. (b)(1) A certification for the Principal Executive Officer of the registrant is attached hereto as part of EX-99.CERT. (b)(2) A certification for the Principal Financial Officer of the registrant is attached hereto as part of EX-99.CERT. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (Registrant) Van Kampen Municipal Trust By: /s/ Ronald E. Robison ---------------------- Name: Ronald E. Robison Title: Principal Executive Officer Date: June 22, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Ronald E. Robison ---------------------- Name: Ronald E. Robison Title: Principal Executive Officer Date: June 22, 2004 By: /s/ John L. Sullivan ---------------------- Name: John L. Sullivan Title: Principal Financial Officer Date: June 22, 2004