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: | (811-07513) |
Exact name of registrant as specified in charter: | Putnam Funds Trust |
Address of principal executive offices: | 100 Federal Street, Boston, Massachusetts 02110 |
Name and address of agent for service: | Stephen Tate, Vice President |
100 Federal Street |
Boston, Massachusetts 02110 |
Copy to: | Bryan Chegwidden, Esq. |
Ropes & Gray LLP |
1211 Avenue of the Americas |
New York, New York 10036 |
James E. Thomas, Esq. |
Ropes & Gray LLP |
800 Boylston Street |
Boston, Massachusetts 02199 |
Registrant’s telephone number, including area code: | (617) 292-1000 |
Date of fiscal year end: | June 30, 2024 |
Date of reporting period: | July 1, 2023 – June 30, 2024 |
Item 1. Report to Stockholders: |
The following is a copy of the report transmitted to stockholders pursuant to Rule 30e-1 under the Investment Company Act of 1940: |
Putnam International Value Fund |  | |
| Class A [PNGAX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class A | $112 | 1.06% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSA-0824 |
Class A 6/30/2014 — 6/30/2024
1 Year | 5 Year | 10 Year | |
Class A (without sales charge) | 10.76 | 8.33 | 3.93 |
Class A (with sales charge) | 4.39 | 7.06 | 3.31 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSA-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSA-0824 |
Putnam International Value Fund |  | |
| Class B [PGNBX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class B | $190 | 1.81% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSB-0824 |
1 Year | 5 Year | 10 Year | |
Class B (without sales charge) | 10.03 | 7.53 | 3.31 |
Class B (with sales charge) | 5.03 | 7.23 | 3.31 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSB-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSB-0824 |
Putnam International Value Fund |  | |
| Class C [PIGRX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class C | $190 | 1.81% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSC-0824 |
1 Year | 5 Year | 10 Year | |
Class C (without sales charge) | 9.95 | 7.50 | 3.31 |
Class C (with sales charge) | 8.95 | 7.50 | 3.31 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSC-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSC-0824 |
Putnam International Value Fund |  | |
| Class R [PIIRX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class R | $138 | 1.31% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSR-0824 |
1 Year | 5 Year | 10 Year | |
Class R (without sales charge) | 10.61 | 8.07 | 3.67 |
Class R (with sales charge) | 10.61 | 8.07 | 3.67 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSR-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSR-0824 |
Putnam International Value Fund |  | |
| Class R6 [PIGWX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class R6 | $69 | 0.65% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSR6-0824 |
1 Year | 5 Year | 10 Year | |
Class R6 (without sales charge) | 11.27 | 8.79 | 4.36 |
Class R6 (with sales charge) | 11.27 | 8.79 | 4.36 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSR6-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSR6-0824 |
Putnam International Value Fund |  | |
| Class Y [PNGYX] | ||
| Annual Shareholder Report | June 30, 2024 | ||
 | ||
You can find additional information about the Fund at https://www.franklintempleton.com/regulatory-fund-documents. You can also request this information by contacting us at (800) 225-1581.
Class Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment* |
| Class Y | $85 | 0.81% |
| * | Reflects fee waivers and/or expense reimbursements, without which expenses would have been higher. |
Top contributors to performance: | |
| Overweight positions relative to the benchmark in: | |
| ↑ | Sumitomo Mitsui Financial Group, a Japanese financial group |
| ↑ | Mitsubishi, a Japan-based global trading company |
| ↑ | ING Groep, a Netherlands-based multinational banking and financial services company |
Top detractors from performance: | |
| ↓ | Out-of-benchmark position in Prudential, a U.K.-based multinational insurance company |
| ↓ | Decision not to own Toyota Motor Corporation, which is held in the benchmark |
| ↓ | Overweight position in Alstom, a France-based manufacturer serving rail transport markets |
| Putnam International Value Fund | PAGE 1 | 38967-ATSY-0824 |
1 Year | 5 Year | 10 Year | |
Class Y (without sales charge) | 11.08 | 8.60 | 4.19 |
Class Y (with sales charge) | 11.08 | 8.60 | 4.19 |
MSCI All Country World ex-US Index-NR | 11.62 | 5.55 | 3.84 |
MSCI EAFE Value Index-NR | 13.75 | 6.07 | 3.02 |
Total Net Assets | $441,522,861 |
Total Number of Portfolio Holdings* | 197 |
Total Management Fee Paid | $1,953,137 |
Portfolio Turnover Rate | 21% |
| * | Includes derivatives, if applicable. |
| Putnam International Value Fund | PAGE 2 | 38967-ATSY-0824 |
| Cash and Equivalents, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Holdings and allocations may vary over time. |
 | WHERE CAN I FIND ADDITIONAL INFORMATION ABOUT THE FUND? |
Additional information is available on https://www.franklintempleton.com/regulatory-fund-documents, including its: | |
| • prospectus • proxy voting information • financial information • holdings • tax information |
| Putnam International Value Fund | PAGE 3 | 38967-ATSY-0824 |
Item 2. Code of Ethics: |
a) The fund’s principal executive, financial and accounting officers are employees of Putnam Investment Management, LLC, the Fund’s investment manager, or Franklin Templeton. As such they are subject to a comprehensive Code of Ethics adopted and administered by Putnam Investment Management, LLC and Franklin Templeton which is designed to protect the interests of the firm and its clients. The Fund has adopted a Code of Ethics which incorporates the Code of Ethics of Franklin Templeton with respect to all of its officers and Trustees who are employees of Putnam Investment Management, LLC and Franklin Templeton. For this reason, the Fund has not adopted a separate code of ethics governing its principal executive, financial and accounting officers. |
(c) In connection with the acquisition of Putnam Investments by Franklin Templeton, the Putnam Investments Code of Ethics was amended effective January 1, 2024 to reflect revised compliance processes, including: (i) Compliance with the Putnam Investments Code of Ethics will be viewed as compliance with the Franklin Templeton Code for certain Putnam employees who are dual-hatted in Franklin Templeton advisory entities (ii) Certain Franklin Templeton employees are required to hold shares of Putnam mutual funds at Putnam Investor Services, Inc. and (iii) Certain provisions of the Putnam Investments Code of Ethics are amended that are no longer needed due to organizational changes. Effective March 4, 2024, the majority of legacy Putnam employees transitioned to Franklin Templeton policies outlined in the Franklin Templeton Code. |
Item 3. Audit Committee Financial Expert: |
The Funds’ Audit, Compliance and Risk Committee is comprised solely of Trustees who are “independent” (as such term has been defined by the Securities and Exchange Commission (“SEC”) in regulations implementing Section 407 of the Sarbanes-Oxley Act (the “Regulations”)). The Trustees believe that each member of the Audit, Compliance and Risk Committee also possesses a combination of knowledge and experience with respect to financial accounting matters, as well as other attributes, that qualifies him or her for service on the Committee. In addition, the Trustees have determined that each of Mr. McGreevey and Mr. Singh qualifies as an “audit committee financial expert” (as such term has been defined by the Regulations) based on their review of his or her pertinent experience and education.The SEC has stated, and the funds’ amended and restated agreement and Declaration of Trust provides, that the designation or identification of a person as an audit committee financial expert pursuant to this Item 3 of Form N-CSR does not impose on such person any duties, obligations or liability that are greater than the duties, obligations and liability imposed on such person as a member of the Audit, Compliance and Risk Committee and the Board of Trustees in the absence of such designation or identification. |
Item 4. Principal Accountant Fees and Services: |
The following table presents fees billed in each of the last two fiscal years for services rendered to the fund by the fund’s independent auditor: |
| Fiscal year ended | Audit Fees | Audit-Related Fees | Tax Fees | All Other Fees |
| June 30, 2024 | $69,643 | $ — | $9,559 | $ — |
| June 30, 2023 | $58,749 | $ — | $10,780 | $ — |
For the fiscal years ended June 30, 2024 and June 30, 2023, the fund’s independent auditor billed aggregate non-audit fees in the amounts of $924,522 and $252,523 respectively, to the fund, Putnam Management and any entity controlling, controlled by or under common control with Putnam Management that provides ongoing services to the fund. |
Audit Fees represent fees billed for the fund’s last two fiscal years relating to the audit and review of the financial statements included in annual reports and registration statements, and other services that are normally provided in connection with statutory and regulatory filings or engagements. |
Audit-Related Fees represent fees billed in the fund’s last two fiscal years for services traditionally performed by the fund’s auditor, including accounting consultation for proposed transactions or concerning financial accounting and reporting standards and other audit or attest services not required by statute or regulation. |
Tax Fees represent fees billed in the fund’s last two fiscal years for tax compliance, tax planning and tax advice services. Tax planning and tax advice services include assistance with tax audits, employee benefit plans and requests for rulings or technical advice from taxing authorities. |
Pre-Approval Policies of the Audit, Compliance and Risk Committee. The Audit, Compliance and Risk Committee of the Putnam funds has determined that, as a matter of policy, all work performed for the funds by the funds’ independent auditors will be pre-approved by the Committee itself and thus will generally not be subject to pre-approval procedures. |
The Audit, Compliance and Risk Committee also has adopted a policy to pre-approve the engagement by Putnam Management and certain of its affiliates of the funds’ independent auditors, even in circumstances where pre-approval is not required by applicable law. Any such requests by Putnam Management or certain of its affiliates are typically submitted in writing to the Committee and explain, among other things, the nature of the proposed engagement, the estimated fees, and why this work should be performed by that particular audit firm as opposed to another one. In reviewing such requests, the Committee considers, among other things, whether the provision of such services by the audit firm are compatible with the independence of the audit firm. |
The following table presents fees billed by the fund’s independent auditor for services required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2–01 of Regulation S-X. |
| Fiscal year ended | Audit-Related Fees | Tax Fees | All Other Fees | Total Non-Audit Fees |
| June 30, 2024 | $ — | $861,963 | $53,000 | $914,963 |
| June 30, 2023 | $ — | $241,743 | $ — | $241,743 |
(i) Not applicable |
(j) Not applicable |
Item 5. Audit Committee of Listed Registrants |
Not applicable |
Item 6. Investments: |
The registrant’s schedule of investments in unaffiliated issuers is included in the Financial Statements and Other Important Information in Item 7 below. |
Item 7. Financial Statements and Financial Highlights for Open-End Management Investment Companies. |
Putnam
International Value Fund
Financial Statements and Other Important Information
Annual | June 30, 2024
Table of Contents
| Financial Statements and Other Important Information—Annual | franklintempleton.com |
Report of Independent Registered Public Accounting Firm
To the Board of Trustees of Putnam Funds Trust and Shareholders of Putnam International Value Fund:
Opinion on the Financial Statements
We have audited the accompanying statement of assets and liabilities, including the fund’s portfolio, of Putnam International Value Fund (one of the funds constituting Putnam Funds Trust, referred to hereafter as the “Fund”) as of June 30, 2024, the related statement of operations for the year ended June 30, 2024, the statement of changes in net assets for each of the two years in the period ended June 30, 2024, including the related notes, and the financial highlights for each of the five years in the period ended June 30, 2024 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of June 30, 2024, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended June 30, 2024 and the financial highlights for each of the five years in the period ended June 30, 2024 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of June 30, 2024 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
August 13, 2024
We have served as the auditor of one or more investment companies in the Putnam Funds family of funds since at least 1957. We have not been able to determine the specific year we began serving as auditor.
| International Value Fund 1 |
| The fund’s portfolio 6/30/24 | ||
| COMMON STOCKS (96.8%)* | Shares | Value |
| Aerospace and defense (1.2%) | ||
| Thales SA (France) | 32,546 | $5,229,631 |
| 5,229,631 | ||
| Air freight and logistics (1.0%) | ||
| Deutsche Post AG (Germany) | 112,217 | 4,540,460 |
| 4,540,460 | ||
| Automobiles (2.4%) | ||
| Stellantis NV (Italy) | 269,699 | 5,304,387 |
| Yamaha Motor Co., Ltd. (Japan) | 578,000 | 5,374,201 |
| 10,678,588 | ||
| Banks (21.3%) | ||
| AIB Group PLC (Ireland) | 2,150,392 | 11,329,550 |
| ANZ Group Holdings, Ltd. (Australia) | 488,727 | 9,202,880 |
| Barclays PLC (United Kingdom) | 2,119,651 | 5,592,349 |
| BNP Paribas SA (France) | 118,787 | 7,611,868 |
| CaixaBank SA (Spain) | 1,442,128 | 7,631,876 |
| DNB Bank ASA (Norway) | 188,309 | 3,697,718 |
| HSBC Holdings PLC (United Kingdom) | 1,427,381 | 12,352,546 |
| ING Groep NV (Netherlands) | 795,517 | 13,630,931 |
| Mitsubishi UFJ Financial Group, Inc. (Japan) | 1,083,100 | 11,685,469 |
| Mizuho Financial Group, Inc. (Japan) | 140,220 | 2,936,258 |
| Sumitomo Mitsui Financial Group, Inc. (Japan) | 126,500 | 8,461,496 |
| 94,132,941 | ||
| Beverages (2.2%) | ||
| Asahi Group Holdings, Ltd. (Japan) | 70,700 | 2,497,325 |
| Coca-Cola Europacific Partners PLC (Spain) | 96,155 | 7,006,815 |
| 9,504,140 | ||
| Biotechnology (0.8%) | ||
| Argenx SE (Netherlands) † | 8,283 | 3,580,573 |
| 3,580,573 | ||
| Broadline retail (0.4%) | ||
| Pan Pacific International Holdings Corp. (Japan) | 80,200 | 1,881,828 |
| 1,881,828 | ||
| Building products (1.3%) | ||
| Cie de Saint-Gobain SA (France) | 74,910 | 5,801,108 |
| 5,801,108 | ||
| Capital markets (2.6%) | ||
| Quilter PLC (United Kingdom) | 684,242 | 1,037,407 |
| UBS Group AG (Switzerland) | 364,131 | 10,658,689 |
| 11,696,096 | ||
| Chemicals (0.5%) | ||
| LANXESS AG (Germany) | 91,072 | 2,236,147 |
| 2,236,147 | ||
| Construction and engineering (2.0%) | ||
| Vinci SA (France) | 83,171 | 8,749,156 |
| 8,749,156 | ||
| Construction materials (1.9%) | ||
| CRH PLC (London Exchange) | 112,861 | 8,367,668 |
| 8,367,668 | ||
| Consumer staples distribution and retail (2.1%) | ||
| Seven & i Holdings Co., Ltd. (Japan) | 344,700 | 4,198,272 |
| Tesco PLC (United Kingdom) | 1,257,878 | 4,869,847 |
| 9,068,119 | ||
| Diversified REITs (0.7%) | ||
| Mirvac Group (Australia) R | 2,635,619 | 3,289,510 |
| 3,289,510 | ||
| Diversified telecommunication services (3.4%) | ||
| Deutsche Telekom AG (Germany) | 266,610 | 6,706,808 |
| Nippon Telegraph & Telephone Corp. (Japan) | 7,285,500 | 6,885,856 |
| Telstra Group, Ltd. (Australia) | 562,422 | 1,355,353 |
| 14,948,017 |
2 International Value Fund | |
| COMMON STOCKS (96.8%)* cont. | Shares | Value |
| Financial services (1.2%) | ||
| ORIX Corp. (Japan) | 244,100 | $5,415,444 |
| 5,415,444 | ||
| Food products (1.6%) | ||
| Ajinomoto Co., Inc. (Japan) | 111,900 | 3,938,750 |
| Nissin Food Products Co., Ltd. (Japan) | 123,400 | 3,130,690 |
| 7,069,440 | ||
| Health care equipment and supplies (1.2%) | ||
| Hoya Corp. (Japan) | 44,000 | 5,148,338 |
| 5,148,338 | ||
| Hotels, restaurants, and leisure (0.7%) | ||
| Compass Group PLC (United Kingdom) | 117,721 | 3,205,074 |
| 3,205,074 | ||
| Household durables (2.3%) | ||
| Cairn Homes PLC (Ireland) | 2,080,924 | 3,542,541 |
| Panasonic Holdings Corp. (Japan) | 279,400 | 2,295,533 |
| Sony Group Corp. (Japan) | 50,300 | 4,274,090 |
| 10,112,164 | ||
| Industrial conglomerates (3.1%) | ||
| Siemens AG (Germany) | 73,328 | 13,638,212 |
| 13,638,212 | ||
| Insurance (8.4%) | ||
| ASR Nederland NV (Netherlands) | 149,461 | 7,121,010 |
| AXA SA (France) | 289,178 | 9,521,861 |
| Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Germany) | 13,293 | 6,646,963 |
| Prudential PLC (United Kingdom) | 518,858 | 4,707,032 |
| QBE Insurance Group, Ltd. (Australia) | 792,524 | 9,190,875 |
| 37,187,741 | ||
| Machinery (1.8%) | ||
| Alstom SA (France) S | 159,855 | 2,682,828 |
| MinebeaMitsumi, Inc. (Japan) | 253,500 | 5,227,927 |
| 7,910,755 | ||
| Metals and mining (2.7%) | ||
| Anglo American PLC (London Exchange) (United Kingdom) | 83,112 | 2,614,242 |
| Glencore PLC (United Kingdom) | 1,593,996 | 9,088,616 |
| 11,702,858 | ||
| Multi-utilities (3.2%) | ||
| E.ON SE (Germany) | 488,269 | 6,398,917 |
| Veolia Environnement SA (France) | 254,486 | 7,640,796 |
| 14,039,713 | ||
| Oil, gas, and consumable fuels (8.2%) | ||
| BP PLC (United Kingdom) | 1,344,587 | 8,101,786 |
| Shell PLC (United Kingdom) | 360,500 | 12,955,442 |
| Suncor Energy, Inc. (Canada) | 241,050 | 9,188,814 |
| TotalEnergies SE (France) | 90,857 | 6,055,535 |
| 36,301,577 | ||
| Passenger airlines (1.1%) | ||
| Qantas Airways, Ltd. (voting rights) (Australia) † | 1,224,832 | 4,765,809 |
| 4,765,809 | ||
| Personal care products (1.5%) | ||
| Unilever PLC (United Kingdom) | 119,328 | 6,552,712 |
| 6,552,712 | ||
| Pharmaceuticals (4.8%) | ||
| AstraZeneca PLC (United Kingdom) | 50,127 | 7,814,598 |
| Sanofi SA (France) | 137,389 | 13,206,012 |
| 21,020,610 | ||
| Semiconductors and semiconductor equipment (1.0%) | ||
| STMicroelectronics NV (France) | 108,019 | 4,212,318 |
| 4,212,318 | ||
| Specialty retail (0.8%) | ||
| JD Sports Fashion PLC (United Kingdom) | 2,372,527 | 3,551,009 |
| 3,551,009 |
International Value Fund 3 | |
| COMMON STOCKS (96.8%)* cont. | Shares | Value |
| Technology hardware, storage, and peripherals (0.5%) | ||
| Samsung Electronics Co., Ltd. (South Korea) | 38,060 | $2,236,626 |
| 2,236,626 | ||
| Textiles, apparel, and luxury goods (0.8%) | ||
| Asics Corp. (Japan) | 236,400 | 3,637,717 |
| 3,637,717 | ||
| Tobacco (0.9%) | ||
| Imperial Brands PLC (United Kingdom) | 159,319 | 4,079,175 |
| 4,079,175 | ||
| Trading companies and distributors (6.0%) | ||
| Ashtead Group PLC (United Kingdom) | 50,721 | 3,379,485 |
| Ferguson PLC (United Kingdom) | 25,730 | 4,944,686 |
| ITOCHU Corp. (Japan) | 137,600 | 6,751,703 |
| Mitsubishi Corp. (Japan) | 576,700 | 11,342,866 |
| 26,418,740 | ||
| Wireless telecommunication services (1.2%) | ||
| KDDI Corp. (Japan) | 71,400 | 1,892,117 |
| Vodafone Group PLC (United Kingdom) | 4,016,746 | 3,538,856 |
| 5,430,973 | ||
| Total common stocks (cost $368,651,577) | $427,340,987 | |
| SHORT-TERM INVESTMENTS (2.6%)* | Principal amount/ shares | Value | |
| Putnam Cash Collateral Pool, LLC 5.54% d | Shares | 240,810 | $240,810 |
| Putnam Short Term Investment Fund Class P 5.48% L | Shares | 10,263,793 | 10,263,793 |
| State Street Institutional U.S. Government Money Market Fund, Premier Class 5.25% P | Shares | 320,000 | 320,000 |
| U.S. Treasury Bills 5.415%, 8/27/24 | $200,000 | 198,339 | |
| U.S. Treasury Bills 5.381%, 7/23/24 ∆ | 600,000 | 598,075 | |
| Total short-term investments (cost $11,621,021) | $11,621,017 | ||
| TOTAL INVESTMENTS | ||
| Total investments (cost $380,272,598) | $438,962,004 | |
| Notes to the fund’s portfolio | |||
| Unless noted otherwise, the notes to the fund’s portfolio are for the close of the fund’s reporting period, which ran from July 1, 2023 through June 30, 2024 (the reporting period). Within the following notes to the portfolio, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Franklin Resources, Inc., and references to “ASC 820” represent Accounting Standards Codification 820 Fair Value Measurements and Disclosures. | |||
| * | Percentages indicated are based on net assets of $441,522,861. | ||
| † | This security is non-income-producing. | ||
| ∆ | This security, in part or in entirety, was pledged and segregated with the custodian for collateral on certain derivative contracts at the close of the reporting period. Collateral at period end totaled $14,946 and is included in Investments in securities on the Statement of assets and liabilities (Notes 1 and 8). | ||
| d | Affiliated company. See Notes 1 and 5 to the financial statements regarding securities lending. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period. | ||
| L | Affiliated company (Note 5). The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period. | ||
| P | This security was pledged, or purchased with cash that was pledged, to the fund for collateral on certain derivative contracts. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period. | ||
| R | Real Estate Investment Trust. | ||
| S | Security on loan, in part or in entirety, at the close of the reporting period (Note 1). | ||
| Unless otherwise noted, the rates quoted in Short-term investments security descriptions represent the weighted average yield to maturity. | |||
| The dates shown on debt obligations are the original maturity dates. | |||
| DIVERSIFICATION BY COUNTRY | ||||||||
| Distribution of investments by country of risk at the close of the reporting period, excluding collateral received, if any (as a percentage of Portfolio Value): | ||||||||
| United Kingdom | 22.5% | Spain | 3.3% | |||||
| Japan | 22.2 | Switzerland | 2.4 | |||||
| France | 16.1 | Canada | 2.1 | |||||
| Germany | 9.2 | Italy | 1.2 | |||||
| Australia | 6.3 | Norway | 0.8 | |||||
| Netherlands | 5.6 | South Korea | 0.5 | |||||
| United States | 4.4 | Total | 100.0% | |||||
| Ireland | 3.4 | |||||||
4 International Value Fund | |
| FORWARD CURRENCY CONTRACTS at 6/30/24 (aggregate face value $194,919,385) | ||||||
| Counterparty | Currency | Contract type* | Delivery date | Value | Aggregate face value | Unrealized appreciation/ (depreciation) |
| Bank of America N.A. | ||||||
| Australian Dollar | Buy | 7/17/24 | $1,203,658 | $1,194,322 | $9,336 | |
| Australian Dollar | Sell | 7/17/24 | 1,203,658 | 1,202,868 | (790) | |
| Australian Dollar | Buy | 10/16/24 | 1,206,272 | 1,205,598 | 674 | |
| British Pound | Sell | 9/18/24 | 4,309,875 | 4,352,349 | 42,474 | |
| Canadian Dollar | Buy | 7/17/24 | 1,830,903 | 1,830,470 | 433 | |
| Canadian Dollar | Sell | 7/17/24 | 1,830,903 | 1,859,810 | 28,907 | |
| Canadian Dollar | Sell | 10/16/24 | 1,834,903 | 1,834,399 | (504) | |
| Euro | Sell | 9/18/24 | 937,889 | 954,380 | 16,491 | |
| Japanese Yen | Sell | 8/21/24 | 272,493 | 279,779 | 7,286 | |
| Norwegian Krone | Buy | 9/18/24 | 517,963 | 523,448 | (5,485) | |
| Swedish Krona | Buy | 9/18/24 | 1,450,679 | 1,471,183 | (20,504) | |
| Swiss Franc | Buy | 9/18/24 | 977,402 | 982,901 | (5,499) | |
| Barclays Bank PLC | ||||||
| British Pound | Sell | 9/18/24 | 2,165,878 | 2,192,654 | 26,776 | |
| Euro | Sell | 9/18/24 | 18,958,045 | 18,973,779 | 15,734 | |
| Japanese Yen | Buy | 8/21/24 | 1,155,935 | 1,213,165 | (57,230) | |
| Citibank, N.A. | ||||||
| British Pound | Sell | 9/18/24 | 9,789,075 | 9,868,449 | 79,374 | |
| Canadian Dollar | Buy | 7/17/24 | 537,081 | 538,031 | (950) | |
| Canadian Dollar | Sell | 7/17/24 | 537,081 | 536,573 | (508) | |
| Danish Krone | Buy | 9/18/24 | 1,384,704 | 1,408,192 | (23,488) | |
| Hong Kong Dollar | Buy | 8/21/24 | 655,715 | 655,890 | (175) | |
| Japanese Yen | Sell | 8/21/24 | 1,559,347 | 1,648,690 | 89,343 | |
| Singapore Dollar | Buy | 8/21/24 | 409,148 | 411,273 | (2,125) | |
| Swedish Krona | Buy | 9/18/24 | 561,721 | 569,638 | (7,917) | |
| Swiss Franc | Buy | 9/18/24 | 374,558 | 376,642 | (2,084) | |
| Goldman Sachs International | ||||||
| Australian Dollar | Buy | 7/17/24 | 896,270 | 889,309 | 6,961 | |
| Australian Dollar | Sell | 7/17/24 | 896,270 | 895,643 | (627) | |
| Australian Dollar | Buy | 10/16/24 | 898,216 | 897,672 | 544 | |
| British Pound | Sell | 9/18/24 | 1,113,927 | 1,124,931 | 11,004 | |
| Canadian Dollar | Buy | 7/17/24 | 1,142,751 | 1,144,273 | (1,522) | |
| Canadian Dollar | Sell | 7/17/24 | 1,142,751 | 1,151,933 | 9,182 | |
| Canadian Dollar | Sell | 10/16/24 | 192,951 | 192,869 | (82) | |
| Chilean Peso | Buy | 7/17/24 | 606,783 | 604,424 | 2,359 | |
| Chilean Peso | Sell | 7/17/24 | 606,783 | 599,444 | (7,339) | |
| Chilean Peso | Buy | 10/16/24 | 606,459 | 599,064 | 7,395 | |
| Hong Kong Dollar | Buy | 8/21/24 | 436,913 | 437,030 | (117) | |
| Israeli Shekel | Buy | 7/17/24 | 997,012 | 1,013,499 | (16,487) | |
| Israeli Shekel | Sell | 7/17/24 | 997,012 | 1,002,645 | 5,633 | |
| Israeli Shekel | Buy | 10/16/24 | 1,001,237 | 1,007,037 | (5,800) | |
International Value Fund 5 | |
| FORWARD CURRENCY CONTRACTS at 6/30/24 (aggregate face value $194,919,385) cont. | ||||||
| Counterparty | Currency | Contract type* | Delivery date | Value | Aggregate face value | Unrealized appreciation/ (depreciation) |
| Goldman Sachs International cont. | ||||||
| Singapore Dollar | Buy | 8/21/24 | $4,389,081 | $4,412,735 | $(23,654) | |
| Swiss Franc | Buy | 9/18/24 | 1,452,509 | 1,460,549 | (8,040) | |
| HSBC Bank USA, National Association | ||||||
| Australian Dollar | Buy | 7/17/24 | 952,996 | 945,436 | 7,560 | |
| Australian Dollar | Sell | 7/17/24 | 952,996 | 952,386 | (610) | |
| Australian Dollar | Buy | 10/16/24 | 955,065 | 954,512 | 553 | |
| British Pound | Sell | 9/18/24 | 1,591,017 | 1,606,728 | 15,711 | |
| Chinese Yuan (Offshore) | Buy | 8/21/24 | 1,428,141 | 1,436,654 | (8,513) | |
| Euro | Sell | 9/18/24 | 517,478 | 526,606 | 9,128 | |
| Hong Kong Dollar | Buy | 8/21/24 | 1,025,802 | 1,026,407 | (605) | |
| Israeli Shekel | Buy | 7/17/24 | 435,525 | 442,587 | (7,062) | |
| Israeli Shekel | Sell | 7/17/24 | 435,525 | 438,003 | 2,478 | |
| Israeli Shekel | Buy | 10/16/24 | 437,371 | 439,889 | (2,518) | |
| Japanese Yen | Buy | 8/21/24 | 468,467 | 491,686 | (23,219) | |
| Norwegian Krone | Buy | 9/18/24 | 257,982 | 260,624 | (2,642) | |
| Swedish Krona | Buy | 9/18/24 | 1,701,569 | 1,725,629 | (24,060) | |
| Swiss Franc | Buy | 9/18/24 | 837,308 | 841,957 | (4,649) | |
| JPMorgan Chase Bank N.A. | ||||||
| Canadian Dollar | Buy | 7/17/24 | 2,160,318 | 2,159,499 | 819 | |
| Canadian Dollar | Sell | 7/17/24 | 2,160,318 | 2,194,296 | 33,978 | |
| Canadian Dollar | Sell | 10/16/24 | 2,165,038 | 2,164,075 | (963) | |
| Danish Krone | Buy | 9/18/24 | 418,198 | 425,053 | (6,855) | |
| New Zealand Dollar | Buy | 7/17/24 | 295,962 | 293,454 | 2,508 | |
| New Zealand Dollar | Sell | 7/17/24 | 295,962 | 296,749 | 787 | |
| New Zealand Dollar | Buy | 10/16/24 | 295,947 | 296,732 | (785) | |
| Singapore Dollar | Buy | 8/21/24 | 288,215 | 289,715 | (1,500) | |
| South Korean Won | Sell | 8/21/24 | 2,241,029 | 2,214,882 | (26,147) | |
| Morgan Stanley & Co. International PLC | ||||||
| Australian Dollar | Buy | 7/17/24 | 507,130 | 505,707 | 1,423 | |
| Australian Dollar | Sell | 7/17/24 | 507,130 | 505,702 | (1,428) | |
| British Pound | Sell | 9/18/24 | 2,718,858 | 2,740,287 | 21,429 | |
| Canadian Dollar | Buy | 7/17/24 | 716,011 | 716,494 | (483) | |
| Canadian Dollar | Sell | 7/17/24 | 716,011 | 727,186 | 11,175 | |
| Canadian Dollar | Sell | 10/16/24 | 491,721 | 491,522 | (199) | |
| Czech Koruna | Buy | 9/18/24 | 448,997 | 462,303 | (13,306) | |
| Euro | Buy | 9/18/24 | 2,161,714 | 2,200,032 | (38,318) | |
| Japanese Yen | Buy | 8/21/24 | 2,975,708 | 2,963,911 | 11,797 | |
| Norwegian Krone | Buy | 9/18/24 | 457,062 | 461,779 | (4,717) | |
| Swedish Krona | Buy | 9/18/24 | 1,323,135 | 1,342,102 | (18,967) | |
| Swiss Franc | Buy | 9/18/24 | 1,488,684 | 1,499,492 | (10,808) | |
| NatWest Markets PLC | ||||||
| Australian Dollar | Buy | 7/17/24 | 1,269,994 | 1,262,497 | 7,497 | |
| Australian Dollar | Sell | 7/17/24 | 1,269,994 | 1,267,985 | (2,009) | |
| Australian Dollar | Buy | 10/16/24 | 764,520 | 764,031 | 489 | |
| British Pound | Buy | 9/18/24 | 304,695 | 304,871 | (176) | |
| Danish Krone | Buy | 9/18/24 | 1,541,153 | 1,567,729 | (26,576) | |
| Euro | Buy | 9/18/24 | 2,369,500 | 2,369,984 | (484) | |
| Swedish Krona | Buy | 9/18/24 | 3,576,982 | 3,628,107 | (51,125) | |
| Swiss Franc | Buy | 9/18/24 | 2,748,185 | 2,763,459 | (15,274) | |
| State Street Bank and Trust Co. | ||||||
| British Pound | Buy | 9/18/24 | 1,396,361 | 1,405,895 | (9,534) | |
| Canadian Dollar | Buy | 7/17/24 | 3,039,683 | 3,038,365 | 1,318 | |
| Canadian Dollar | Sell | 7/17/24 | 3,039,683 | 3,083,998 | 44,315 | |
| Canadian Dollar | Sell | 10/16/24 | 1,285,730 | 1,286,792 | 1,062 | |
6 International Value Fund | |
| FORWARD CURRENCY CONTRACTS at 6/30/24 (aggregate face value $194,919,385) cont. | ||||||
| Counterparty | Currency | Contract type* | Delivery date | Value | Aggregate face value | Unrealized appreciation/ (depreciation) |
| State Street Bank and Trust Co. cont. | ||||||
| Euro | Sell | 9/18/24 | $1,443,651 | $1,441,152 | $(2,499) | |
| Hong Kong Dollar | Buy | 8/21/24 | 3,688,123 | 3,688,973 | (850) | |
| Israeli Shekel | Buy | 7/17/24 | 1,126,178 | 1,145,656 | (19,478) | |
| Israeli Shekel | Sell | 7/17/24 | 1,126,178 | 1,132,255 | 6,077 | |
| Israeli Shekel | Buy | 10/16/24 | 1,130,951 | 1,137,368 | (6,417) | |
| Singapore Dollar | Buy | 8/21/24 | 272,543 | 273,974 | (1,431) | |
| Swedish Krona | Buy | 9/18/24 | 721,091 | 731,184 | (10,093) | |
| Swiss Franc | Buy | 9/18/24 | 13,989,318 | 14,084,211 | (94,893) | |
| Toronto-Dominion Bank | ||||||
| Australian Dollar | Buy | 7/17/24 | 34,569 | 34,300 | 269 | |
| Australian Dollar | Sell | 7/17/24 | 34,569 | 34,545 | (24) | |
| Australian Dollar | Buy | 10/16/24 | 34,645 | 34,623 | 22 | |
| British Pound | Sell | 9/18/24 | 2,219,253 | 2,241,159 | 21,906 | |
| Canadian Dollar | Buy | 7/17/24 | 1,541,413 | 1,542,516 | (1,103) | |
| Canadian Dollar | Sell | 7/17/24 | 1,541,413 | 1,565,526 | 24,113 | |
| Canadian Dollar | Sell | 10/16/24 | 1,083,471 | 1,083,117 | (354) | |
| Euro | Sell | 9/18/24 | 1,627,789 | 1,627,430 | (359) | |
| Hong Kong Dollar | Buy | 8/21/24 | 3,323,025 | 3,324,110 | (1,085) | |
| Singapore Dollar | Buy | 8/21/24 | 435,537 | 437,775 | (2,238) | |
| Swiss Franc | Buy | 9/18/24 | 1,739,101 | 1,748,785 | (9,684) | |
| UBS AG | ||||||
| British Pound | Buy | 9/18/24 | 136,727 | 136,747 | (20) | |
| Canadian Dollar | Buy | 7/17/24 | 1,781,619 | 1,781,210 | 409 | |
| Canadian Dollar | Sell | 7/17/24 | 1,781,619 | 1,809,592 | 27,973 | |
| Canadian Dollar | Sell | 10/16/24 | 1,785,511 | 1,784,962 | (549) | |
| Euro | Sell | 9/18/24 | 2,484,412 | 2,526,232 | 41,820 | |
| Israeli Shekel | Buy | 7/17/24 | 317,777 | 323,007 | (5,230) | |
| Israeli Shekel | Sell | 7/17/24 | 317,777 | 319,508 | 1,731 | |
| Israeli Shekel | Buy | 10/16/24 | 319,123 | 320,841 | (1,718) | |
| Swedish Krona | Buy | 9/18/24 | 905,458 | 918,228 | (12,770) | |
| Swiss Franc | Buy | 9/18/24 | 4,057,229 | 4,076,933 | (19,704) | |
| WestPac Banking Corp. | ||||||
| Canadian Dollar | Buy | 7/17/24 | 703,653 | 703,478 | 175 | |
| Canadian Dollar | Sell | 7/17/24 | 703,653 | 714,668 | 11,015 | |
| Canadian Dollar | Sell | 10/16/24 | 705,191 | 704,978 | (213) | |
| Euro | Sell | 9/18/24 | 932,299 | 948,680 | 16,381 | |
| Swedish Krona | Buy | 9/18/24 | 688,175 | 697,988 | (9,813) | |
| Swiss Franc | Buy | 9/18/24 | 6,506,464 | 6,542,345 | (35,881) | |
| Unrealized appreciation | 685,824 | |||||
| Unrealized (depreciation) | (730,865) | |||||
| Total | $(45,041) | |||||
| * The exchange currency for all contracts listed is the United States Dollar. | ||||||
International Value Fund 7 | |
ASC 820 establishes a three-level hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of the fund’s investments. The three levels are defined as follows:
Level 1: Valuations based on quoted prices for identical securities in active markets.
Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
Level 3: Valuations based on inputs that are unobservable and significant to the fair value measurement.
The following is a summary of the inputs used to value the fund’s net assets as of the close of the reporting period:
| Valuation inputs | |||
| Investments in securities: | Level 1 | Level 2 | Level 3 |
| Common stocks*: | |||
| Communication services | $— | $20,378,990 | $— |
| Consumer discretionary | — | 33,066,380 | — |
| Consumer staples | 7,006,815 | 29,266,771 | — |
| Energy | 9,188,814 | 27,112,763 | — |
| Financials | — | 148,432,222 | — |
| Health care | — | 29,749,521 | — |
| Industrials | — | 77,053,871 | — |
| Information technology | — | 6,448,944 | — |
| Materials | — | 22,306,673 | — |
| Real estate | — | 3,289,510 | — |
| Utilities | — | 14,039,713 | — |
| Total common stocks | 16,195,629 | 411,145,358 | — |
| Short-term investments | 320,000 | 11,301,017 | — |
| Totals by level | $16,515,629 | $422,446,375 | $— |
| Valuation inputs | |||
| Other financial instruments: | Level 1 | Level 2 | Level 3 |
| Forward currency contracts | $— | $(45,041) | $— |
| Totals by level | $— | $(45,041) | $— |
* Common stock classifications are presented at the sector level, which may differ from the fund’s portfolio presentation.
The accompanying notes are an integral part of these financial statements.
8 International Value Fund | |
Financial Statements
Statement of assets and liabilities
6/30/24
| ASSETS | |
| Investment in securities, at value, including $232,205 of securities on loan (Note 1): | |
| Unaffiliated issuers (identified cost $369,767,995) | $428,457,401 |
| Affiliated issuers (identified cost $10,504,603) (Note 5) | 10,504,603 |
| Foreign currency (cost $477,293) (Note 1) | 477,269 |
| Dividends, interest and other receivables | 904,076 |
| Foreign tax reclaim | 1,701,709 |
| Receivable for shares of the fund sold | 604,649 |
| Receivable for investments sold | 441,146 |
| Unrealized appreciation on forward currency contracts (Note 1) | 685,824 |
| Prepaid assets | 52,554 |
| Total assets | 443,829,231 |
| LIABILITIES | |
| Payable for shares of the fund repurchased | 201,276 |
| Payable for compensation of Manager (Note 2) | 302,146 |
| Payable for custodian fees (Note 2) | 13,605 |
| Payable for investor servicing fees (Note 2) | 191,272 |
| Payable for Trustee compensation and expenses (Note 2) | 90,813 |
| Payable for administrative services (Note 2) | 1,050 |
| Payable for distribution fees (Note 2) | 87,351 |
| Unrealized depreciation on forward currency contracts (Note 1) | 730,865 |
| Collateral on certain derivative contracts, at value (Notes 1 and 8) | 320,000 |
| Collateral on securities loaned, at value (Note 1) | 240,810 |
| Other accrued expenses | 127,182 |
| Total liabilities | 2,306,370 |
| Net assets | $441,522,861 |
| Represented by | |
| Paid-in capital (Unlimited shares authorized) (Notes 1 and 4) | $372,663,972 |
| Total distributable earnings (Note 1) | 68,858,889 |
| Total — Representing net assets applicable to capital shares outstanding | $441,522,861 |
| COMPUTATION OF NET ASSET VALUE AND OFFERING PRICE | |
| Net asset value and redemption price per class A share ($121,487,383 divided by 8,932,246 shares) | $13.60 |
| Offering price per class A share (100/94.25 of $13.60)* | $14.43 |
| Net asset value and offering price per class B share ($76,190 divided by 5,494 shares)** | $13.87 |
| Net asset value and offering price per class C share ($1,704,891 divided by 124,885 shares)** | $13.65 |
| Net asset value, offering price and redemption price per class R share ($7,105,722 divided by 531,194 shares) | $13.38 |
| Net asset value, offering price and redemption price per class R6 share ($65,377,569 divided by 4,788,507 shares) | $13.65 |
| Net asset value, offering price and redemption price per class Y share ($245,771,106 divided by 18,098,194 shares) | $13.58 |
| * | 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.
International Value Fund 9
Statement of operations
Year ended 6/30/24
| Investment income | |
| Dividends (net of foreign tax of $1,313,298) | $14,628,486 |
| Interest (including interest income of $711,339 from investments in affiliated issuers) (Note 5) | 754,743 |
| Securities lending (net of expenses) (Notes 1 and 5) | 3,013 |
| Other income (Note 1) | 1,352,647 |
| Total investment income | 16,738,889 |
| EXPENSES | |
| Compensation of Manager (Note 2) | 2,745,536 |
| Investor servicing fees (Note 2) | 722,983 |
| Custodian fees (Note 2) | 47,618 |
| Trustee compensation and expenses (Note 2) | 19,338 |
| Distribution fees (Note 2) | 330,167 |
| Administrative services (Note 2) | 10,790 |
| Other | 352,104 |
| Fees waived and reimbursed by Manager (Note 2) | (792,399) |
| Total expenses | 3,436,137 |
| Expense reduction (Note 2) | (3,060) |
| Net expenses | 3,433,077 |
| Net investment income | 13,305,812 |
| REALIZED AND UNREALIZED GAIN (LOSS) | |
| Net realized gain (loss) on: | |
| Securities from unaffiliated issuers (Notes 1 and 3) | 9,605,205 |
| Foreign currency transactions (Note 1) | (143,661) |
| Forward currency contracts (Note 1) | (1,749,502) |
| Total net realized gain | 7,712,042 |
| Change in net unrealized appreciation on: | |
| Securities from unaffiliated issuers | 21,289,231 |
| Assets and liabilities in foreign currencies | 5,180 |
| Forward currency contracts | 357,169 |
| Total change in net unrealized appreciation | 21,651,580 |
| Net gain on investments | 29,363,622 |
| Net increase in net assets resulting from operations | $42,669,434 |
The accompanying notes are an integral part of these financial statements.
10 International Value Fund
Statement of changes in net assets
| Year ended 6/30/24 | Year ended 6/30/23 | |
| Increase in net assets | ||
| Operations | ||
| Net investment income | $13,305,812 | $8,050,117 |
| Net realized gain (loss) on investments and foreign currency transactions | 7,712,042 | (6,307,263) |
| Change in net unrealized appreciation of investments and assets and liabilities in foreign currencies | 21,651,580 | 51,048,150 |
| Net increase in net assets resulting from operations | 42,669,434 | 52,791,004 |
| Distributions to shareholders (Note 1): | ||
| From ordinary income | ||
| Net investment income | ||
| Class A | (2,719,757) | (1,628,035) |
| Class B | (1,670) | (1,274) |
| Class C | (29,680) | (7,600) |
| Class R | (74,881) | (27,814) |
| Class R6 | (1,544,138) | (488,399) |
| Class Y | (5,612,643) | (2,232,507) |
| Increase from capital share transactions (Note 4) | 55,291,877 | 90,633,339 |
| Total increase in net assets | 87,978,542 | 139,038,714 |
| Net assets | ||
| Beginning of year | 353,544,319 | 214,505,605 |
| End of year | $441,522,861 | $353,544,319 |
The accompanying notes are an integral part of these financial statements.
International Value Fund 11
Financial highlights
(For a common share outstanding throughout the period)
| INVESTMENT OPERATIONS | LESS DISTRIBUTIONS | RATIOS AND SUPPLEMENTAL DATA | |||||||||||
| Period ended | Net asset value, beginning of period | Net investment income (loss) a | Net realized and unrealized gain (loss) on investments | Total from investment operations | From net investment income | From net realized gain on investments | Total distributions | Net asset value, end of period | Total return at net asset value (%) b | Net assets, end of period (in thousands) | Ratio of expenses to average net assets (%) c | Ratio of net investment income (loss) to average net assets (%) | Portfolio turnover (%) |
| Class A | |||||||||||||
| June 30, 2024 | $12.57 | .40 | .94 | 1.34 | (.31) | — | (.31) | $13.60 | 10.76 | $121,487 | 1.06 d | 3.07 d | 21 |
| June 30, 2023 | 10.44 | .31 | 2.00 | 2.31 | (.18) | — | (.18) | 12.57 | 22.39 | 118,860 | 1.11 d | 2.75 d | 15 |
| June 30, 2022 | 12.71 | .30 | (1.88) | (1.58) | (.15) | (.54) | (.69) | 10.44 | (13.12) | 96,655 | 1.27 d,e | 2.44 d | 6 |
| June 30, 2021 | 9.39 | .22 | 3.31 | 3.53 | (.18) | (.03) | (.21) | 12.71 | 37.87 | 115,696 | 1.43 | 1.93 | 17 |
| June 30, 2020 | 10.62 | .16 | (.95) | (.79) | (.25) | (.19) | (.44) | 9.39 | (8.11) | 90,141 | 1.40 d | 1.60 d | 19 |
| Class B | |||||||||||||
| June 30, 2024 | $12.75 | .25 | 1.02 | 1.27 | (.15) | — | (.15) | $13.87 | 10.03 | $76 | 1.81 d | 1.90 d | 21 |
| June 30, 2023 | 10.56 | .20 | 2.05 | 2.25 | (.06) | — | (.06) | 12.75 | 21.41 | 193 | 1.86 d | 1.81 d | 15 |
| June 30, 2022 | 12.81 | .19 f | (1.88) | (1.69) | (.02) | (.54) | (.56) | 10.56 | (13.79) | 261 | 2.02 d,e | 1.54 d,f | 6 |
| June 30, 2021 | 9.45 | .13 | 3.33 | 3.46 | (.07) | (.03) | (.10) | 12.81 | 36.77 | 493 | 2.18 | 1.13 | 17 |
| June 30, 2020 | 10.66 | .08 | (.96) | (.88) | (.14) | (.19) | (.33) | 9.45 | (8.72) | 585 | 2.15 d | .81 d | 19 |
| Class C | |||||||||||||
| June 30, 2024 | $12.64 | .31 | .94 | 1.25 | (.24) | — | (.24) | $13.65 | 9.95 | $1,705 | 1.81 d | 2.41 d | 21 |
| June 30, 2023 | 10.49 | .24 | 2.00 | 2.24 | (.09) | — | (.09) | 12.64 | 21.41 | 1,323 | 1.86 d | 2.14 d | 15 |
| June 30, 2022 | 12.75 | .23 | (1.91) | (1.68) | (.04) | (.54) | (.58) | 10.49 | (13.74) | 1,070 | 2.02 d,e | 1.90 d | 6 |
| June 30, 2021 | 9.41 | .13 | 3.32 | 3.45 | (.08) | (.03) | (.11) | 12.75 | 36.79 | 1,154 | 2.18 | 1.13 | 17 |
| June 30, 2020 | 10.63 | .09 | (.98) | (.89) | (.14) | (.19) | (.33) | 9.41 | (8.84) | 1,275 | 2.15 d | .84 d | 19 |
| Class R | |||||||||||||
| June 30, 2024 | $12.38 | .48 | .82 | 1.30 | (.30) | — | (.30) | $13.38 | 10.61 | $7,106 | 1.31 d | 3.69 d | 21 |
| June 30, 2023 | 10.30 | .28 | 1.96 | 2.24 | (.16) | — | (.16) | 12.38 | 21.97 | 2,303 | 1.36 d | 2.52 d | 15 |
| June 30, 2022 | 12.57 | .32 f | (1.91) | (1.59) | (.14) | (.54) | (.68) | 10.30 | (13.32) | 1,725 | 1.52 d,e | 2.64 d,f | 6 |
| June 30, 2021 | 9.29 | .19 | 3.27 | 3.46 | (.15) | (.03) | (.18) | 12.57 | 37.52 | 869 | 1.68 | 1.67 | 17 |
| June 30, 2020 | 10.51 | .14 | (.95) | (.81) | (.22) | (.19) | (.41) | 9.29 | (8.33) | 747 | 1.65 d | 1.37 d | 19 |
| Class R6 | |||||||||||||
| June 30, 2024 | $12.61 | .48 | .92 | 1.40 | (.36) | — | (.36) | $13.65 | 11.27 | $65,378 | .65 d | 3.66 d | 21 |
| June 30, 2023 | 10.48 | .39 | 1.97 | 2.36 | (.23) | — | (.23) | 12.61 | 22.84 | 37,985 | .69 d | 3.39 d | 15 |
| June 30, 2022 | 12.76 | .37 | (1.90) | (1.53) | (.21) | (.54) | (.75) | 10.48 | (12.75) | 20,253 | .86 d,e | 3.03 d | 6 |
| June 30, 2021 | 9.43 | .28 | 3.31 | 3.59 | (.23) | (.03) | (.26) | 12.76 | 38.42 | 15,053 | .99 | 2.42 | 17 |
| June 30, 2020 | 10.66 | .21 | (.96) | (.75) | (.29) | (.19) | (.48) | 9.43 | (7.68) | 5,907 | .95 d | 2.08 d | 19 |
| Class Y | |||||||||||||
| June 30, 2024 | $12.55 | .45 | .92 | 1.37 | (.34) | — | (.34) | $13.58 | 11.08 | $245,771 | .81 d | 3.46 d | 21 |
| June 30, 2023 | 10.43 | .37 | 1.97 | 2.34 | (.22) | — | (.22) | 12.55 | 22.69 | 192,881 | .86 d | 3.21 d | 15 |
| June 30, 2022 | 12.71 | .37 f | (1.91) | (1.54) | (.20) | (.54) | (.74) | 10.43 | (12.89) | 94,542 | 1.02 d,e | 3.08 d,f | 6 |
| June 30, 2021 | 9.40 | .28 | 3.27 | 3.55 | (.21) | (.03) | (.24) | 12.71 | 38.13 | 32,909 | 1.18 | 2.36 | 17 |
| June 30, 2020 | 10.63 | .19 | (.96) | (.77) | (.27) | (.19) | (.46) | 9.40 | (7.87) | 6,113 | 1.15 d | 1.89 d | 19 |
12 International Value Fund
Financial highlights cont.
a Per share net investment income (loss) has been determined on the basis of the weighted average number of shares outstanding during the period.
b Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
c Includes amounts paid through expense offset and/or brokerage/service arrangements (Note 2). Also excludes acquired fund fees and expenses, if any.
d Reflects an involuntary contractual expense limitation in effect during the period. As a result of such limitation and/or waivers, the expenses of each class reflect a reduction of the following amounts (Note 2):
| Percent of average net assets | |
| 6/30/24 | 0.20% |
| 6/30/23 | 0.23 |
| 6/30/22 | 0.12 |
| 6/30/20 | 0.03 |
e Includes one-time proxy cost which amounted to 0.01%.
f The net investment income ratio and per share amount shown for the period ending may not correspond with the expected class specific differences for the period due to the timing of subscriptions or redemptions into or out of the class.
The accompanying notes are an integral part of these financial statements.
International Value Fund 13
Notes to financial statements 6/30/24
Unless otherwise noted, the “reporting period” represents the period from July 1, 2023 through June 30, 2024. The following table defines commonly used references within the Notes to financial statements:
| References to | Represent |
| 1940 Act | Investment Company Act of 1940, as amended |
| Franklin Advisers | Franklin Advisers, Inc., a wholly-owned subsidiary of Franklin Templeton |
| Franklin Templeton | Franklin Resources, Inc. |
| Franklin Templeton Services | Franklin Templeton Services, LLC, a wholly-owned subsidiary of Franklin Templeton and an affiliate of Putnam Management |
| JPMorgan | JPMorgan Chase Bank, N.A. |
| OTC | Over-the-counter |
| PAC | The Putnam Advisory Company, LLC, an affiliate of Putnam Management |
| PIL | Putnam Investments Limited, an affiliate of Putnam Management |
| Putnam Management | Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Franklin Templeton |
| SEC | Securities and Exchange Commission |
| State Street | State Street Bank and Trust Company |
Putnam International Value Fund (the fund) is a diversified series of Putnam Funds Trust (the Trust), a Massachusetts business trust registered under the 1940 Act as an open-end management investment company. The goal of the fund is to seek capital growth. Current income is a secondary objective. The fund invests mainly in common stocks of large and midsize companies outside the United States, with a focus on value stocks. Value stocks are those that Putnam Management believes are currently undervalued by the market. If Putnam Management is correct and other investors ultimately recognize the value of the company, the price of its stock may rise. The fund invests mainly in developed countries, but may invest in emerging markets. Putnam Management may consider, among other factors, a company’s valuation, financial strength, growth potential, competitive position in its industry, projected future earnings, cash flows and dividends when deciding whether to buy or sell investments. At times, the fund also uses derivatives, which are expected to include certain foreign currency transactions. For example, the fund typically uses foreign currency forward contracts in connection with the fund’s investments in foreign securities in order to hedge the fund’s currency exposure relative to the fund’s benchmark index.
The fund offers the following share classes. The expenses for each class of shares may differ based on the distribution and investor servicing fees of each class, which are identified in Note 2.
| Share class | Sales charge | Contingent deferred sales charge | Conversion feature |
| Class A | Up to 5.75% | 1.00% on certain redemptions of shares bought with no initial sales charge | None |
| Class B* | None | 5.00% phased out over six years | Converts to class A shares on September 5, 2024 |
| Class C | None | 1.00% eliminated after one year | Converts to class A shares after 8 years |
| Class R† | None | None | None |
| Class R6 † | None | None | None |
| Class Y† | None | None | None |
| * Purchases of class B shares are closed to new and existing investors except by exchange from class B shares of another Putnam fund or through dividend and/or capital gains reinvestment. | |||
| † Not available to all investors. | |||
In the normal course of business, the fund enters into contracts that may include agreements to indemnify another party under given circumstances. The fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be, but have not yet been, made against the fund. However, the fund’s management team expects the risk of material loss to be remote.
The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent and custodian, who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s Agreement and Declaration of Trust, any claims asserted by a shareholder against or on behalf of the Trust (or its series), including claims against Trustees and Officers, must be brought in courts located within the Commonwealth of Massachusetts.
Note 1: Significant accounting policies
The fund follows the accounting and reporting guidance in Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946) and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles (U.S. GAAP), including, but not limited to, ASC 946. The following is a summary of significant accounting policies consistently followed by the fund in the preparation of its financial statements. The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and the reported amounts of increases and decreases in net assets from operations. Actual results could differ from those estimates. Subsequent events after the Statement of assets and liabilities date through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.
Investment income, realized and unrealized gains and losses and expenses of the fund are borne pro-rata based on the relative net assets of each class to the total net assets of the fund, except that each class bears expenses unique to that class (including the distribution fees applicable to such classes). Each class votes as a class 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. If the fund were liquidated, shares of each class would receive their pro-rata share of the net assets of the fund. In addition, the Trustees declare separate dividends on each class of shares.
Security valuation Portfolio securities and other investments are valued using policies and procedures adopted by the Board of Trustees (Trustees). The Trustees have formed a Pricing Committee to oversee the implementation of these procedures. Under compliance policies and procedures approved by the Trustees, the Trustees have designated the fund’s investment manager as the valuation designee and has responsibility for oversight of valuation. The investment manager is assisted by the fund’s administrator in performing this responsibility, including leading the cross-functional Valuation Committee (VC). The VC is responsible for making fair value determinations, evaluating the effectiveness of the pricing policies of the fund and reporting to the Trustees.
Investments for which market quotations are readily available are valued at the last reported sales price on their principal exchange, or official closing price for certain markets, and are classified as Level 1 securities under Accounting Standards Codification 820 Fair Value Measurements and Disclosures (ASC 820). If no sales are reported, as in the case of some securities that are traded OTC, a security is valued at its last reported bid price and is generally categorized as a Level 2 security.
Investments in open-end investment companies (excluding exchange-traded funds), if any, which can be classified as Level 1 or Level 2 securities, are valued based on their net asset value. The net asset value of such investment companies equals the total value of their assets less their liabilities and divided by the number of their outstanding shares.
Market quotations are not considered to be readily available for certain debt obligations (including short-term investments with remaining maturities of 60 days or less) and other investments; such investments are valued on the basis of valuations furnished by an independent pricing service approved by the Trustees or dealers selected by Putnam Management. Such services or dealers determine valuations for normal institutional-size trading units of such securities using methods based on market transactions for comparable securities and various
14 International Value Fund
relationships, generally recognized by institutional traders, between securities (which consider such factors as security prices, yields, maturities and ratings). These securities will generally be categorized as Level 2.
Many securities markets and exchanges outside the U.S. close prior to the scheduled close of the New York Stock Exchange and therefore the closing prices for securities in such markets or on such exchanges may not fully reflect events that occur after such close but before the scheduled close of the New York Stock Exchange. Accordingly, on certain days, the fund will fair value certain foreign equity securities taking into account multiple factors including movements in the U.S. securities markets, currency valuations and comparisons to the valuation of American Depository Receipts, exchange-traded funds and futures contracts. The foreign equity securities, which would generally be classified as Level 1 securities, will be transferred to Level 2 of the fair value hierarchy when they are valued at fair value. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the fund to a significant extent. At the close of the reporting period, fair value pricing was used for certain foreign securities in the portfolio. Securities quoted in foreign currencies, if any, are translated into U.S. dollars at the current exchange rate.
To the extent a pricing service or dealer is unable to value a security or provides a valuation that Putnam Management does not believe accurately reflects the security’s fair value, the security will be valued at fair value by Putnam Management, which has been designated as valuation designee pursuant to Rule 2a–5 under the 1940 Act, in accordance with policies and procedures approved by the Trustees. Certain investments, including certain restricted and illiquid securities and derivatives, are also valued at fair value following procedures approved by the Trustees. These valuations consider such factors as significant market or specific security events such as interest rate or credit quality changes, various relationships with other securities, discount rates, U.S. Treasury, U.S. swap and credit yields, index levels, convexity exposures, recovery rates, sales and other multiples and resale restrictions. These securities are classified as Level 2 or as Level 3 depending on the priority of the significant inputs.
To assess the continuing appropriateness of fair valuations, the Valuation Committee reviews and affirms the reasonableness of such valuations on a regular basis after considering all relevant information that is reasonably available. Such valuations and procedures are reviewed periodically by the Trustees. The fair value of securities is generally determined as the amount that the fund could reasonably expect to realize from an orderly disposition of such securities over a reasonable period of time. By its nature, a fair value price is a good faith estimate of the value of a security in a current sale and does not reflect an actual market price, which may be different by a material amount.
Security transactions and related investment income Security transactions are recorded on the trade date (the date the order to buy or sell is executed). Gains or losses on securities sold are determined on the identified cost basis.
Interest income, net of any applicable withholding taxes, if any, is recorded on the accrual basis. Amortization and accretion of premiums and discounts on debt securities, if any, is recorded on the accrual basis.
Dividend income, net of any applicable withholding taxes, is recognized on the ex-dividend date except that certain dividends from foreign securities, if any, are recognized as soon as the fund is informed of the ex-dividend date. Non-cash dividends, if any, are recorded at the fair value of the securities received. Dividends representing a return of capital or capital gains, if any, are reflected as a reduction of cost and/or as a realized gain.
Foreign currency translation The accounting records of the fund are maintained in U.S. dollars. The fair value of foreign securities, currency holdings, and other assets and liabilities is recorded in the books and records of the fund after translation to U.S. dollars based on the exchange rates on that day. The cost of each security is determined using historical exchange rates. Income and withholding taxes are translated at prevailing exchange rates when earned or incurred. The fund does not isolate that portion of realized or unrealized gains or losses resulting from changes in the foreign exchange rate on investments from fluctuations arising from changes in the market prices of the securities. Such gains and losses are included with the net realized and unrealized gain or loss on investments. Net realized gains and losses on foreign currency transactions represent net realized exchange gains or losses on disposition of foreign currencies, currency gains and losses realized between the trade and settlement dates on securities transactions and the difference between the amount of investment income and foreign withholding taxes recorded on the fund’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized appreciation and depreciation of assets and liabilities in foreign currencies arise from changes in the value of assets and liabilities other than investments at the period end, resulting from changes in the exchange rate.
Forward currency contracts The fund buys and sells forward currency contracts, which are agreements between two parties to buy and sell currencies at a set price on a future date. These contracts are used to hedging foreign exchange risk.
The U.S. dollar value of forward currency contracts is determined using current forward currency exchange rates supplied by a quotation service. The fair value of the contract will fluctuate with changes in currency exchange rates. The contract is marked to market daily and the change in fair value is recorded as an unrealized gain or loss. The fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed when the contract matures or by delivery of the currency. The fund could be exposed to risk if the value of the currency changes unfavorably, if the counterparties to the contracts are unable to meet the terms of their contracts or if the fund is unable to enter into a closing position. Risks may exceed amounts recognized on the Statement of assets and liabilities.
Forward currency contracts outstanding at period end, if any, are listed after the fund’s portfolio.
Master agreements The fund is a party to ISDA (International Swaps and Derivatives Association, Inc.) Master Agreements (Master Agreements) with certain counterparties that govern OTC derivative and foreign exchange contracts entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties’ general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agreements, collateral pledged to the fund is held in a segregated account by the fund’s custodian and, with respect to those amounts which can be sold or repledged, is presented in the fund’s portfolio.
Collateral pledged by the fund is segregated by the fund’s custodian and identified in the fund’s portfolio. Collateral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other securities as agreed to by the fund and the applicable counterparty. Collateral requirements are determined based on the fund’s net position with each counterparty.
Termination events applicable to the fund may occur upon a decline in the fund’s net assets below a specified threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term and short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the fund’s counterparties to elect early termination could impact the fund’s future derivative activity.
At the close of the reporting period, the fund had a net liability position of $314,577 on open derivative contracts subject to the Master Agreements. Collateral pledged by the fund at period end for these agreements totaled $14,946 and may include amounts related to unsettled agreements.
Securities lending The fund may lend securities, through its agent, to qualified borrowers in order to earn additional income. The loans are collateralized by cash in an amount at least equal to the fair value of the securities loaned. The fair value of securities loaned is determined daily and any additional required collateral is allocated to the fund on the next business day. The remaining maturities of the securities lending transactions are considered overnight and continuous. The risk of borrower default will be borne by the fund’s agent; the fund will bear the risk of loss with respect to the investment of the cash collateral. Income from securities lending, if any, is net of expenses and is included in investment income on the Statement of operations. Cash collateral is invested in Putnam Cash Collateral Pool, LLC, a limited liability company managed by an affiliate of Putnam Management. Investments in Putnam Cash Collateral Pool, LLC are valued at its closing net asset value each business day. There are no management fees charged to Putnam Cash Collateral Pool, LLC. At the close of the reporting period, the fund received cash collateral of $240,810 and the value of securities loaned amounted to $232,205.
Interfund lending The fund, along with other Putnam funds, may participate in an interfund lending program pursuant to an exemptive order issued by the SEC. This program allows the fund to borrow from or lend to other Putnam funds that permit such transactions. Interfund lending transactions are subject to each fund’s investment policies and borrowing and lending limits. Interest earned or paid on
International Value Fund 15
the interfund lending transaction will be based on the average of certain current market rates. During the reporting period, the fund did not utilize the program.
Lines of credit The fund participates, along with other Putnam funds, in a $320 million syndicated unsecured committed line of credit, provided by State Street ($160 million) and JPMorgan ($160 million), and a $235.5 million unsecured uncommitted line of credit, provided by State Street. Borrowings may be made for temporary or emergency purposes, including the funding of shareholder redemption requests and trade settlements. Interest is charged to the fund based on the fund’s borrowing at a rate equal to 1.25% plus the higher of (1) the Federal Funds rate and (2) the Overnight Bank Funding Rate for the committed line of credit and 1.30% plus the higher of (1) the Federal Funds rate and (2) the Overnight Bank Funding Rate for the uncommitted line of credit. A closing fee equal to 0.04% of the committed line of credit and 0.04% of the uncommitted line of credit has been paid by the participating funds and a $75,000 fee has been paid by the participating funds to State Street as agent of the syndicated committed line of credit. In addition, a commitment fee of 0.21% per annum on any unutilized portion of the committed line of credit is allocated to the participating funds based on their relative net assets and paid quarterly. During the reporting period, the fund had no borrowings against these arrangements.
Federal taxes It is the policy of the fund to distribute all of its taxable income within the prescribed time period and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended (the 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 Code.
The fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (ASC 740). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The fund did not have a liability to record for any unrecognized tax benefits in the accompanying financial statements. No provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held nor for excise tax on income and capital gains. Each of the fund’s federal tax returns for the prior three fiscal years remains subject to examination by the Internal Revenue Service.
The fund may also be subject to taxes imposed by governments of countries in which it invests. Such taxes are generally based on either income or gains earned or repatriated. The fund accrues and applies such taxes to net investment income, net realized gains and net unrealized gains as income and/or capital gains are earned. In some cases, the fund may be entitled to reclaim all or a portion of such taxes, and such reclaim amounts, if any, are reflected as an asset and income on the fund’s books. In many cases, however, the fund may not receive such amounts for an extended period of time, depending on the country of investment.
As a result of several court cases, in certain countries across the European Union, the fund filed additional tax reclaims for previously withheld taxes on dividends earned in those countries (EU reclaims). When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims, and the potential timing of payment, no amounts are reflected in the financial statements. For U.S. income tax purposes, EU reclaims received by the fund , if any, reduce the amount of foreign taxes fund shareholders can use as tax deductions or credits on their income tax returns.
Distributions to shareholders Distributions to shareholders from net investment income, if any, are recorded by the fund on the ex-dividend date. Distributions from capital gains, if any, are recorded on the ex-dividend date and paid at least annually. 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. These differences include temporary and/or permanent differences from losses on wash sale transactions, from foreign currency gains and losses and from unrealized gains and losses on passive foreign investment companies. 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. At the close of the reporting period, the fund reclassified $994,557 to decrease undistributed net investment income and $994,557 to decrease accumulated net realized loss.
Tax cost of investments includes adjustments to net unrealized appreciation (depreciation) which may not necessarily be final tax cost basis adjustments, but closely approximate the tax basis unrealized gains and losses that may be realized and distributed to shareholders. The tax basis components of distributable earnings and the federal tax cost as of the close of the reporting period were as follows:
| Unrealized appreciation | $74,914,211 |
| Unrealized depreciation | (21,056,652) |
| Net unrealized appreciation | 53,857,559 |
| Undistributed ordinary income | 8,667,500 |
| Undistributed long-term gains | 4,878,507 |
| Undistributed short-term gains | 223,109 |
| Cost for federal income tax purposes | $385,059,404 |
Expenses of the Trust Expenses directly charged or attributable to any fund will be paid from the assets of that fund. Generally, expenses of the Trust will be allocated among and charged to the assets of each fund on a basis that the Trustees deem fair and equitable, which may be based on the relative assets of each fund or the nature of the services performed and relative applicability to each fund.
Note 2: Management fee, administrative services and other transactions
The fund pays Putnam Management a management fee (base fee) (based on the fund’s average net assets and computed and paid monthly) at annual rates that may vary based on the average of the aggregate net assets of all open-end mutual funds sponsored by Putnam Management (excluding net assets of funds that are invested in, or that are invested in by, other Putnam funds to the extent necessary to avoid “double counting” of those assets). Such annual rates may vary as follows:
| 0.850% | of the first $5 billion, |
| 0.800% | of the next $5 billion, |
| 0.750% | of the next $10 billion, |
| 0.700% | of the next $10 billion, |
| 0.650% | of the next $50 billion, |
| 0.630% | of the next $50 billion, |
| 0.620% | of the next $100 billion and |
| 0.615% | of any excess thereafter. |
In addition, the monthly management fee consists of the monthly base fee plus or minus a performance adjustment for the month. The performance adjustment is determined based on performance over the thirty-six month period then ended. Each month, the performance adjustment is calculated by multiplying the performance adjustment rate and the fund’s average net assets over the performance period and dividing the result by twelve. The resulting dollar amount is added to, or subtracted from the base fee for that month. The performance adjustment rate is equal to 0.03 multiplied by the difference between the fund’s annualized performance (measured by the fund’s class A shares) and the annualized performance of the MSCI EAFE Value Index (Net Dividends) each measured over the performance period. The maximum annualized performance adjustment rate is +/- 0.15%. The monthly base fee is determined based on the fund’s average net assets for the month, while the performance adjustment is determined based on the fund’s average net assets over the thirty-six month performance period. This means it is possible that, if the fund underperforms significantly over the performance period, and the fund’s assets have declined significantly over that period, the negative performance adjustment may exceed the base fee. In this event, Putnam Management would make a payment to the fund.
Because the performance adjustment is based on the fund’s performance relative to its applicable benchmark index, and not its absolute performance, the performance adjustment could increase Putnam Management’s fee even if the fund’s shares lose value during the performance period provided that the fund outperformed its benchmark index, and could decrease Putnam Management’s fee even if the fund’s shares increase in value during the performance period provided that the fund underperformed its benchmark index.
For the reporting period, the management fee represented an effective rate (excluding the impact of any expense waiver in effect) of 0.695% of the fund’s average net assets, which included an effective base fee of 0.685% and an increase of 0.010% ($38,536) based on performance.
Effective July 15, 2024, Franklin Advisers was retained by Putnam Management as a sub-adviser for the fund pursuant to a new sub-advisory agreement between Putnam Management and Franklin Advisers.
Putnam Management has contractually agreed, through October 30, 2025, to waive fees and/or reimburse the fund’s expenses to the extent necessary to limit the cumulative expenses of the fund, exclusive of brokerage, interest, taxes, investment-related expenses, extraordinary expenses, acquired fund fees and expenses and payments under the fund’s investor servicing contract, investment
16 International Value Fund
management contract and distribution plans, on a fiscal year-to-date basis to an annual rate of 0.20% of the fund’s average net assets over such fiscal year-to-date period. During the reporting period, the fund’s expenses were not reduced as a result of this limit.
Putnam Management has also contractually agreed to waive fees (and, to the extent necessary, bear other expenses) of the fund through October 30, 2025, to the extent that total expenses of the fund (before any applicable performance-based adjustment to the fund’s base management fee and excluding brokerage, interest, taxes, investment-related expenses, payments under distribution plans, extraordinary expenses, payments under the fund’s investor servicing contract and acquired fund fees and expenses, but including payments under the fund’s investment management contract) would exceed an annual rate of 0.59% of the fund’s average net assets. During the reporting period, the fund’s expenses were reduced by $792,399 as a result of this limit.
PIL is authorized by the Trustees to manage a separate portion of the assets of the fund as determined by Putnam Management from time to time. PIL did not manage any portion of the assets of the fund during the reporting period. If Putnam Management were to engage the services of PIL, Putnam Management would pay a quarterly sub-management fee to PIL for its services at an annual rate of 0.25% of the average net assets of the portion of the fund managed by PIL.
PAC is authorized by the Trustees to manage a separate portion of the assets of the fund, as designated from time to time by Putnam Management or PIL. PAC did not manage any portion of the assets of the fund during the reporting period. If Putnam Management or PIL were to engage the services of PAC, Putnam Management or PIL, as applicable, would pay a quarterly sub-advisory fee to PAC for its services at the annual rate of 0.25% of the average net assets of the portion of the fund’s assets for which PAC is engaged as sub-adviser.
On January 1, 2024, a subsidiary of Franklin Templeton acquired Putnam U.S. Holdings I, LLC (“Putnam Holdings”), the parent company of Putnam Management, PIL and PAC, in a stock and cash transaction (the “Transaction”). As a result of the Transaction, Putnam Management, PIL and PAC became indirect, wholly-owned subsidiaries of Franklin Templeton. The Transaction also resulted in the automatic termination of the investment management contract between the fund and Putnam Management, the sub-management contract for the fund between Putnam Management and PIL, and the sub-advisory contract for the fund among Putnam Management, PIL and PAC that were in place for the fund before the Transaction (together, the “Previous Advisory Contracts”). However, for the period from January 1, 2024 until February 14, 2024, Putnam Management, PIL and PAC continued to provide uninterrupted services with respect to the fund pursuant to interim investment management, sub-management and sub-advisory contracts (together, the “Interim Advisory Contracts”) that were approved by the Board of Trustees. The terms of the Interim Advisory Contracts were identical to those of the Previous Advisory Contracts, except for the term of the contracts and those provisions required by regulation. On February 14, 2024, new investment management, sub-management and sub-advisory contracts were approved by fund shareholders at a shareholder meeting held in connection with the Transaction (together, the “New Advisory Contracts”). The New Advisory Contracts took effect on February 14, 2024 and replaced the Interim Advisory Contracts. The terms of the New Advisory Contracts are substantially similar to those of the Previous Advisory Contracts, and the fee rates payable under the New Advisory Contracts are the same as the fee rates under the Previous Advisory Contracts.
Effective June 1, 2024, under an agreement with Putnam Management, Franklin Templeton Services provides certain administrative services to the fund. The fee for those services is paid by Putnam Management based on the fund’s average daily net assets and is not an additional expense of the fund.
The fund reimburses Putnam Management an allocated amount 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.
Custodial functions for the fund’s assets are provided by State Street. Custody fees are based on the fund’s asset level, the number of its security holdings and transaction volumes.
Putnam Investor Services, Inc., an affiliate of Putnam Management, provides investor servicing agent functions to the fund. Putnam Investor Services, Inc. received fees for investor servicing for class A, class B, class C, class R and class Y shares that included (1) a per account fee for each direct and underlying non-defined contribution account (retail account) of the fund; (2) a specified rate of the fund’s assets attributable to defined contribution plan accounts; and (3) a specified rate based on the average net assets in retail accounts. Putnam Investor Services, Inc. has agreed that the aggregate investor servicing fees for each fund’s retail and defined contribution accounts for these share classes will not exceed an annual rate of 0.25% of the fund’s average assets attributable to such accounts.
Class R6 shares paid a monthly fee based on the average net assets of class R6 shares at an annual rate of 0.05%.
During the reporting period, the expenses for each class of shares related to investor servicing fees were as follows:
| Class A | $240,413 |
| Class B | 291 |
| Class C | 3,143 |
| Class R | 8,195 |
| Class R6 | 27,867 |
| Class Y | 443,074 |
| Total | $722,983 |
The fund has entered into expense offset arrangements with Putnam Investor Services, Inc. and State Street whereby Putnam Investor Services, Inc.’s and State Street’s fees are reduced by credits allowed on cash balances. For the reporting period, the fund’s expenses were reduced by $3,060 under the expense offset arrangements.
Each Independent Trustee of the fund receives an annual Trustee fee, of which $338, as a quarterly retainer, has been allocated to the fund, and an additional fee for each Trustees meeting attended. Trustees also are reimbursed for expenses they incur relating to their services as Trustees.
The fund has adopted a Trustee Fee Deferral Plan (the Deferral Plan) which allows the Trustees to defer the receipt of all or a portion of Trustees fees payable from July 1, 1995 through December 31, 2023. The deferred fees remain invested in certain Putnam funds until distribution in accordance with the Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension plan (the Pension Plan) covering all Trustees of the fund who have served as a Trustee for at least five years and were first elected prior to 2004. Benefits under the Pension Plan are equal to 50% of the Trustee’s average annual attendance and retainer fees for the three years ended December 31, 2005. The retirement benefit is payable during a Trustee’s lifetime, beginning the year following retirement, for the number of years of service through December 31, 2006. Pension expense for the fund is included in Trustee compensation and expenses in the Statement of operations. Accrued pension liability is included in Payable for Trustee compensation and expenses in the Statement of assets and liabilities. The Trustees have terminated the Pension Plan with respect to any Trustee first elected after 2003.
The fund has adopted distribution plans (the Plans) with respect to the following share classes pursuant to Rule 12b–1 under the 1940 Act. The purpose of the Plans is to compensate Putnam Retail Management Limited Partnership, an indirect wholly-owned subsidiary of Franklin Templeton, for services provided and expenses incurred in distributing shares of the fund. Effective August 2, 2024, Franklin Distributors, LLC, an indirect wholly-owned subsidiary of Franklin Templeton, will replace Putnam Retail Management Limited Partnership as the fund’s distributor and principal underwriter. The Plans provide payments by the fund to Putnam Retail Management Limited Partnership at an annual rate of up to the following amounts (Maximum %) of the average net assets attributable to each class. The Trustees have approved payment by the fund at the following annual rate (Approved %) of the average net assets attributable to each class. During the reporting period, the class-specific expenses related to distribution fees were as follows:
| Maximum % | Approved % | Amount | |
| Class A | 0.35% | 0.25% | $293,186 |
| Class B | 1.00% | 1.00% | 1,413 |
| Class C | 1.00% | 1.00% | 15,366 |
| Class R | 1.00% | 0.50% | 20,202 |
| Total | $330,167 |
For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received net commissions of $12,933 from the sale of class A shares and received no monies and $268 in contingent deferred sales charges from redemptions of class B and class C shares, respectively.
A deferred sales charge of up to 1.00% is assessed on certain redemptions of class A shares. For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received $2 on class A redemptions.
International Value Fund 17
Note 3: Purchases and sales of securities
During the reporting period, the cost of purchases and the proceeds from sales, excluding short-term investments, were as follows:
| Cost of purchases | Proceeds from sales | |
| Investments in securities (Long-term) | $139,006,179 | $81,282,555 |
| U.S. government securities (Long-term) | — | — |
| Total | $139,006,179 | $81,282,555 |
The fund may purchase or sell investments from or to other Putnam funds in the ordinary course of business, which can reduce the fund’s transaction costs, at prices determined in accordance with SEC requirements and policies approved by the Trustees. During the reporting period, purchases or sales of long-term securities from or to other Putnam funds, if any, did not represent more than 5% of the fund’s total cost of purchases and/or total proceeds from sales.
Note 4: Capital shares
At the close of the reporting period, there were an unlimited number of shares of beneficial interest authorized. Transactions, including, if applicable, direct exchanges pursuant to share conversions, in capital shares were as follows:
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class A | Shares | Amount | Shares | Amount |
| Shares sold | 735,841 | $9,659,962 | 1,236,222 | $14,765,237 |
| Shares issued in connection with reinvestment of distributions | 204,624 | 2,629,421 | 141,446 | 1,571,467 |
| 940,465 | 12,289,383 | 1,377,668 | 16,336,704 | |
| Shares repurchased | (1,467,748) | (18,899,719) | (1,175,032) | (13,282,134) |
| Net increase (decrease) | (527,283) | $(6,610,336) | 202,636 | $3,054,570 |
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class B | Shares | Amount | Shares | Amount |
| Shares sold | — | $— | 517 | $6,319 |
| Shares issued in connection with reinvestment of distributions | 127 | 1,670 | 107 | 1,210 |
| 127 | 1,670 | 624 | 7,529 | |
| Shares repurchased | (9,770) | (129,670) | (10,194) | (116,857) |
| Net decrease | (9,643) | $(128,000) | (9,570) | $(109,328) |
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class C | Shares | Amount | Shares | Amount |
| Shares sold | 46,230 | $598,611 | 51,005 | $600,769 |
| Shares issued in connection with reinvestment of distributions | 2,271 | 29,409 | 669 | 7,502 |
| 48,501 | 628,020 | 51,674 | 608,271 | |
| Shares repurchased | (28,330) | (367,725) | (48,977) | (555,165) |
| Net increase | 20,171 | $260,295 | 2,697 | $53,106 |
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class R | Shares | Amount | Shares | Amount |
| Shares sold | 458,986 | $5,914,283 | 80,403 | $888,054 |
| Shares issued in connection with reinvestment of distributions | 5,919 | 74,881 | 2,535 | 27,814 |
| 464,905 | 5,989,164 | 82,938 | 915,868 | |
| Shares repurchased | (119,647) | (1,544,644) | (64,426) | (719,366) |
| Net increase | 345,258 | $4,444,520 | 18,512 | $196,502 |
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class R6 | Shares | Amount | Shares | Amount |
| Shares sold | 3,712,986 | $47,618,318 | 2,228,758 | $26,014,465 |
| Shares issued in connection with reinvestment of distributions | 118,898 | 1,530,222 | 43,410 | 483,149 |
| 3,831,884 | 49,148,540 | 2,272,168 | 26,497,614 | |
| Shares repurchased | (2,054,839) | (26,494,565) | (1,192,678) | (13,308,843) |
| Net increase | 1,777,045 | $22,653,975 | 1,079,490 | $13,188,771 |
| YEAR ENDED 6/30/24 | YEAR ENDED 6/30/23 | |||
| Class Y | Shares | Amount | Shares | Amount |
| Shares sold | 10,451,653 | $134,976,849 | 10,751,418 | $124,620,807 |
| Shares issued in connection with reinvestment of distributions | 437,438 | 5,603,583 | 200,720 | 2,225,981 |
| 10,889,091 | 140,580,432 | 10,952,138 | 126,846,788 | |
| Shares repurchased | (8,161,681) | (105,909,009) | (4,642,267) | (52,597,070) |
| Net increase | 2,727,410 | $34,671,423 | 6,309,871 | $74,249,718 |
18 International Value Fund
Note 5: Affiliated transactions
Transactions during the reporting period with any company which is under common ownership or control were as follows:
| Name of affiliate | Fair value as of 6/30/23 | Purchase cost | Sale proceeds | Investment income | Shares outstanding and fair value as of 6/30/24 |
| Short-term investments | |||||
| Putnam Cash Collateral Pool, LLC* | $— | $5,227,380 | $4,986,570 | $17,228 | $240,810 |
| Putnam Short Term Investment Fund Class P‡ | 12,064,716 | 130,237,888 | 132,038,811 | 711,339 | 10,263,793 |
| Total Short-term investments | $12,064,716 | $135,465,268 | $137,025,381 | $728,567 | $10,504,603 |
| * No management fees are charged to Putnam Cash Collateral Pool, LLC (Note 1). Investment income shown is included in securities lending income on the Statement of operations. There were no realized or unrealized gains or losses during the period. | |||||
| ‡ Management fees charged to Putnam Short Term Investment Fund have been waived by Putnam Management. There were no realized or unrealized gains or losses during the period. | |||||
Note 6: Market, credit and other risks
In the normal course of business, the fund trades financial instruments and enters into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the contracting party to the transaction to perform (credit risk). The fund may be exposed to additional credit risk that an institution or other entity with which the fund has unsettled or open transactions will default. Investments in foreign securities involve certain risks, including those related to economic instability, unfavorable political developments, and currency fluctuations.
Note 7: Summary of derivative activity
The volume of activity for the reporting period for any derivative type that was held during the period is listed below and was based on an average of the holdings at the end of each fiscal quarter:
| Forward currency contracts (contract amount) | $142,600,000 |
The following is a summary of the fair value of derivative instruments as of the close of the reporting period:
| Fair value of derivative instruments as of the close of the reporting period | ||||
| Asset derivatives | Liability derivatives | |||
| Derivatives not accounted for as hedging instruments under ASC 815 | Statement of assets and liabilities location | Fair value | Statement of assets and liabilities location | Fair value |
| Foreign exchange contracts | Investments, Receivables | $685,824 | Payables | $730,865 |
| Total | $685,824 | $730,865 | ||
The following is a summary of realized and change in unrealized gains or losses of derivative instruments in the Statement of operations for the reporting period (Note 1):
| Amount of realized gain or (loss) on derivatives recognized in net gain or (loss) on investments | ||
| Derivatives not accounted for as hedging instruments under ASC 815 | Forward currency contracts | Total |
| Foreign exchange contracts | $(1,749,502) | $(1,749,502) |
| Total | $(1,749,502) | $(1,749,502) |
| Change in unrealized appreciation or (depreciation) on derivatives recognized in net gain or (loss) on investments | ||
| Derivatives not accounted for as hedging instruments under ASC 815 | Forward currency contracts | Total |
| Foreign exchange contracts | $357,169 | $357,169 |
| Total | $357,169 | $357,169 |
International Value Fund 19
Note 8: Offsetting of financial and derivative assets and liabilities
The following table summarizes any derivatives, repurchase agreements and reverse repurchase agreements, at the end of the reporting period, that are subject to an enforceable master netting agreement or similar agreement. For securities lending transactions or borrowing transactions associated with securities sold short, if any, see Note 1. For financial reporting purposes, the fund does not offset financial assets and financial liabilities that are subject to the master netting agreements in the Statement of assets and liabilities.
| Bank of America N.A. | Barclays Bank PLC | Citibank, N.A. | Goldman Sachs International | HSBC Bank USA, National Association | JPMorgan Chase Bank N.A. | Morgan Stanley & Co. International PLC | |
| Assets: | |||||||
| Forward currency contracts# | $105,601 | $42,510 | $168,717 | $43,078 | $35,430 | $38,092 | $45,824 |
| Total Assets | $105,601 | $42,510 | $168,717 | $43,078 | $35,430 | $38,092 | $45,824 |
| Liabilities: | |||||||
| Forward currency contracts# | 32,782 | 57,230 | 37,247 | 63,668 | 73,878 | 36,250 | 88,226 |
| Total Liabilities | $32,782 | $57,230 | $37,247 | $63,668 | $73,878 | $36,250 | $88,226 |
| Total Financial and Derivative Net Assets | $72,819 | $(14,720) | $131,470 | $(20,590) | $(38,448) | $1,842 | $(42,402) |
| Total collateral received (pledged)†## | $— | $— | $110,000 | $— | $— | $1,842 | $— |
| Net amount | $72,819 | $(14,720) | $21,470 | $(20,590) | $(38,448) | $— | $(42,402) |
| Controlled collateral received (including TBA commitments)** | $— | $— | $110,000 | $— | $— | $110,000 | $— |
| Uncontrolled collateral received | $— | $— | $— | $— | $— | $— | $— |
| Collateral (pledged) (including TBA commitments)** | $— | $— | $— | $— | $— | $— | $— |
| NatWest Markets PLC | State Street Bank and Trust Co. | Toronto-Dominion Bank | UBS AG | WestPac Banking Corp. | Total | |
| Assets: | ||||||
| Forward currency contracts# | $7,986 | $52,772 | $46,310 | $71,933 | $27,571 | $685,824 |
| Total Assets | $7,986 | $52,772 | $46,310 | $71,933 | $27,571 | $685,824 |
| Liabilities: | ||||||
| Forward currency contracts# | 95,644 | 145,195 | 14,847 | 39,991 | 45,907 | 730,865 |
| Total Liabilities | $95,644 | $145,195 | $14,847 | $39,991 | $45,907 | $730,865 |
| Total Financial and Derivative Net Assets | $(87,658) | $(92,423) | $31,463 | $31,942 | $(18,336) | $(45,041) |
| Total collateral received (pledged)†## | $(14,946) | $— | $— | $31,942 | $— | |
| Net amount | $(72,712) | $(92,423) | $31,463 | $— | $(18,336) | |
| Controlled collateral received (including TBA commitments)** | $— | $— | $— | $100,000 | $— | $320,000 |
| Uncontrolled collateral received | $— | $— | $— | $— | $— | $— |
| Collateral (pledged) (including TBA commitments)** | $(14,946) | $— | $— | $— | $— | $(14,946) |
| ** | Included with Investments in securities on the Statement of assets and liabilities. |
| † | Additional collateral may be required from certain brokers based on individual agreements. |
| # | Covered by master netting agreement (Note 1). |
| ## | Any over-collateralization of total financial and derivative net assets is not shown. Collateral may include amounts related to unsettled agreements. |
20 International Value Fund
Federal tax information (Unaudited)
For the reporting period, total interest and dividend income from foreign countries were $17,184,654 and taxes paid to foreign countries were $722,987.
For the reporting period, the fund hereby designates $15,126,641, or the maximum amount allowable, of its taxable ordinary income earned as qualified dividends taxed at the individual net capital gain rates.
For the reporting period, pursuant to §871(k) of the Internal Revenue Code, the fund hereby designates $346,402 of distributions paid as qualifying to be taxed as interest-related dividends.
Pursuant to §852 of the Internal Revenue Code, as amended, the fund hereby designates $5,366,358 as a capital gain dividend with respect to the taxable year ended June 30, 2024, or, if subsequently determined to be different, the net capital gain of such year.
The Form 1099 that will be mailed to you in January 2025 will show the tax status of all distributions paid to your account in calendar 2024.
International Value Fund 21
Changes in and disagreements with accountants
Not applicable
Results of any shareholder votes (Unaudited)
February 14, 2024 special meeting
At the meeting, a new Management Contract for your fund with Putnam Investment Management, LLC was approved, as follows:
| Votes for | Votes against | Abstentions/Votes withheld |
| 10,990,631 | 343,475 | 3,185,686 |
At the meeting, a new Sub-Management Contract for your fund between Putnam Investment Management, LLC and Putnam Investments Limited was approved, as follows:
| Votes for | Votes against | Abstentions/Votes withheld |
| 10,962,367 | 380,825 | 3,176,600 |
At the meeting, a new Sub-Advisory Contract for your fund between Putnam Investment Management, LLC, Putnam Investments Limited and The Putnam Advisory Company, LLC was approved, as follows:
| Votes for | Votes against | Abstentions/Votes withheld |
| 10,922,811 | 402,961 | 3,194,020 |
All tabulations are rounded to the nearest whole number.
Remuneration paid to directors, officers, and others
Remuneration paid to directors, officers, and others is included in the Notes to financial statements above.
| 22 International Value Fund |
Board approval of management and subadvisory agreements (Unaudited)
At its meeting on June 28, 2024, the Board of Trustees of your fund, including all of the Trustees who are not “interested persons” (as this term is defined in the Investment Company Act of 1940, as amended (the “1940 Act”)) of the Putnam mutual funds and exchange-traded funds (collectively, the “funds”) (the “Independent Trustees”) approved a new subadvisory agreement (the “New Subadvisory Agreement”) for your fund between Putnam Investment Management, LLC, your fund’s investment adviser (“Putnam Management”), and Franklin Advisers, Inc. (“Franklin Advisers”). Franklin Advisers and Putnam Management are each indirect, wholly owned subsidiaries of Franklin Resources, Inc. (“Franklin Templeton”).
The Trustees considered the proposed New Subadvisory Agreement in connection with an internal reorganization (the “Reorganization”) whereby the fixed income and Investment Solutions investment operations of Putnam Management were combined with those of Franklin Advisers. Pursuant to the New Subadvisory Agreement, Putnam Management retained Franklin Advisers as sub-adviser for each Putnam equity fund so that, following the Reorganization, the Putnam Management fixed income investment personnel that moved to Franklin Advisers pursuant to the Reorganization (the “Fixed Income Personnel”) could continue to provide certain services that they had historically provided to the Putnam equity funds, including, as applicable, cash management services, currency trading services and portfolio management services (the “Services”). After the Reorganization and the effectiveness of the New Subadvisory Agreement, Putnam Management remains the investment adviser to your fund and the other equity funds pursuant to existing management contracts between the equity funds and Putnam Management (the “Current Management Contracts”), and Putnam Investments Limited (“PIL”) continues to serve as a sub-adviser to your fund and other Putnam funds pursuant to a sub-management contract between Putnam Management and PIL (the “Current Sub-Management Contract”) and The Putnam Advisory Company, LLC (“PAC”) continues to serve as a sub-adviser to your fund and certain other Putnam funds pursuant to a sub-advisory contract among Putnam Management, PIL and PAC (the “Current Sub-Advisory Contract”). The Current Management Contracts, Current Sub-Management Contract and Current Sub-Advisory Contract remain in effect until June 30, 2025, unless the contracts are sooner terminated or continued pursuant to their terms.
In connection with the review process, the Independent Trustees’ independent legal counsel (as that term is defined in Rule 0-1(a)(6)(i) under the 1940 Act) met with representatives of Putnam Management and Franklin Templeton to discuss the contract review materials that would be furnished to the Contract Committee. The Board of Trustees, with the assistance of its Contract Committee (which consists solely of Independent Trustees) and its independent legal counsel, requested and evaluated all information it deemed reasonably necessary under the circumstances in connection with its review of the New Subadvisory Agreement. Over the course of several months ending in June 2024, the Contract Committee met on a number of occasions with representatives of Putnam Management and Franklin Templeton, and separately in executive session, to consider the information provided. Throughout this process, the Contract Committee was assisted by the members of the Board of Trustees’ independent staff and by independent legal counsel for the Independent Trustees.
At the Board of Trustees’ June 2024 meeting, the Contract Committee met in executive session to discuss and consider its recommendations with respect to the approval of the New Subadvisory Agreement. At that meeting, the Contract Committee also met in executive session with the other Independent Trustees to discuss its observations and recommendation.
The Trustees considered that, under the New Subadvisory Agreement, the Fixed Income Personnel would provide any necessary Services to the applicable equity funds in their capacity as employees of Franklin Advisers under generally the same terms and conditions related to the equity funds as such services were previously provided by the Fixed Income Personnel in their capacity as employees of Putnam Management under the Current Management Contracts. The Trustees also considered that Putnam Management would be responsible for overseeing the Services provided to the equity funds by Franklin Advisers under the New Subadvisory Agreement and would compensate Franklin Advisers for such services out of the fees it receives under the Current Management Contracts. The Trustees further noted Putnam Management’s and Franklin Templeton’s representations that Franklin Advisers’ appointment as sub-adviser to the equity funds would not result in any material change in the nature or level of investment advisory services provided to the equity funds and that the management fee rates paid by the equity funds would not increase as a result of the New Subadvisory Agreement. In addition, the Trustees considered that counsel to Franklin Advisers and Putnam Management had provided a legal opinion that shareholder approval of the New Subadvisory Agreement was not required under the 1940 Act.
The Trustees considered that, in connection with their review of your fund’s Current Management Contract, Current Sub-Management Contract and Current Sub-Advisory Contract over the course of several months ending in June 2023, they had considered information regarding the nature, extent and quality of the services provided to the fund, the fund’s performance, the fund’s management fees and expense ratios, the profitability of Putnam Management and its affiliates in providing services to the fund, whether there had been economies of scale with respect to the management of the fund and other benefits received by Putnam Management and its affiliates as a result of their relationships with the fund. As part of the review process in connection with the consideration of the New Subadvisory Agreement, the Trustees received and reviewed updated information regarding the profitability of Putnam Management and its affiliates, potential economies of scale, other benefits received by Putnam Management and its affiliates as a result of their relationships with the funds, and the performance and expenses of the funds. The Trustees also received, in connection with their review of the New Subadvisory Agreement, certain performance information for Franklin Advisers’ fixed income and Investment Solutions investment strategies and information regarding the revenues, expenses and profitability of Franklin Templeton’s global investment management business and its U.S. registered investment company business, which includes the financial results of Franklin Advisers. Given the scope of the Services to be provided pursuant to the New Subadvisory Agreement, the fact that the New Sub-Advisory Agreement would maintain the current level of services received by your fund, and the fact that the New Subadvisory Agreement would not impact the fees payable by the fund, since Putnam
| International Value Fund 23 |
Management would be responsible for the payment of fees under the New Subadvisory Agreement, the Trustees considered, but did not rely to a significant extent on the information provided to them described in this paragraph in connection with their consideration of the New Subadvisory Agreement.
Board of Trustees’ Conclusion
After considering the factors described above, as well as other factors, the Board of Trustees, including all of the Independent Trustees, concluded that the fees payable under the New Subadvisory Agreement represented reasonable compensation in light of the nature and quality of the services that would continue to be provided to the equity funds, and determined to approve the New Subadvisory Agreement for your fund. This conclusion was based on a comprehensive consideration of all information provided to the Trustees and was not the result of any single factor.
| 24 International Value Fund |
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| © 2024 Franklin Templeton. All rights reserved. | 38967-AFSOI 08/24 | |
Item 8. Changes in and Disagreements with Accountants for Open-End Management Investment Companies. |
Included in Item 7 above. |
Item 9. Proxy Disclosure for Open-End Management Investment Companies. |
Included in Item 7 above. |
Item 10. Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies. |
Included in Item 7 above. |
Item 11. Statement Regarding Basis for Approval of Investment Advisory Contract. |
Included in Item 7 above. |
Item 12. Disclosure of Proxy Voting Policies and Procedures For Closed-End Management Investment Companies: |
Not applicable |
Item 13. Portfolio Managers of Closed-End Investment Companies |
Not Applicable |
Item 14. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers: |
Not applicable |
Item 15. Submission of Matters to a Vote of Security Holders: |
Not applicable |
Item 16. Controls and Procedures: |
(a) The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the design and operation of such procedures are generally effective to provide reasonable assurance that information required to be disclosed by the registrant in this report is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms. |
(b) Changes in internal control over financial reporting: Not applicable |
Item 17. Disclosures of Securities Lending Activities for Closed-End Investment Companies: |
Not Applicable |
Item 18. Recovery of Erroneously Awarded Compensation. |
(a) No |
(b) No |
Item 19. Exhibits: |
(a)(1) The Code of Ethics of The Putnam Funds and Franklin Templeton are filed herewith |
(a)(2) Any policy required by the listing standards adopted pursuant to Rule 10D-1 under the Exchange Act (17 CFR 240.10D-1) by the registered national securities exchange or registered national securities association upon which the registrant’s securities are listed. |
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. |
Putnam Funds Trust |
By (Signature and Title): |
/s/ Jeffrey White |
Jeffrey White |
Date: August 29, 2024 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. |
By (Signature and Title): |
/s/ Jonathan S. Horwitz |
Jonathan S. Horwitz |
Date: August 29, 2024 |
By (Signature and Title): |
/s/ Jeffrey White |
Jeffrey White |
Date: August 29, 2024 |