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: 811-03734
EuroPacific Growth Fund
(Exact Name of Registrant as Specified in Charter)
333 South Hope Street
Los Angeles, California 90071
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (213) 486-9200
Date of fiscal year end: March 31
Date of reporting period: March 31, 2012
Vincent P. Corti
EuroPacific Growth Fund
333 South Hope Street
Los Angeles, California 90071
(Name and Address of Agent for Service)
Copies to:
Mark D. Perlow
K&L Gates LLP
Four Embarcadero Center, Suite 1200
San Francisco, California 94111
(Counsel for the Registrant)
ITEM 1 – Reports to Stockholders
EuroPacific Growth Fund®
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Special feature
Different routes to growth: in pursuit of global investment opportunities
u See page 6
Annual report for the year ended March 31, 2012
EuroPacific Growth Fund seeks long-term growth of capital by investing primarily in the securities of companies based in Europe and the Pacific Basin. More than half of the world’s investment opportunities can be found beyond the borders of our country. As a shareholder in the fund, you have access to what we believe are the best of those opportunities.
This fund is one of the American Funds. American Funds is one of the nation’s largest mutual fund families. For more than 80 years, Capital Research and Management Company,SM the American Funds adviser, has invested with a long-term focus based on thorough research and attention to risk.
Fund results shown in this report, unless otherwise indicated, are for Class A shares at net asset value. If a sales charge (maximum 5.75%) had been deducted, the results would have been lower. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value. For current information and month-end results, visit americanfunds.com.
Investment results assume all distributions are reinvested and reflect applicable fees and expenses. When applicable, investment results reflect fee waivers, without which results would have been lower. See americanfunds.com for more information.
Results for other share classes can be found on page 34.
Investing outside the United States may be subject to risks, such as currency fluctuations, periods of illiquidity and price volatility. These risks may be heightened in connection with investments in developing countries. See the prospectus and the Risk Factors section of this report for more information on these and other risks associated with investing in the fund.
Fellow investors:
EuroPacific Growth Fund’s fiscal year, ended March 31, 2012, was a period marked by rapidly shifting economic prospects and dramatic changes in market sentiment. Against this volatile backdrop, the fund reported a total return of –6.25% with dividends reinvested. While we are disappointed by this result, it surpassed the –6.75% 12-month return of the unmanaged MSCI All Country World ex USA Index, an index that reflects the returns of more than 40 developed- and developing-country stock markets.
The fund’s return during the period slightly lagged the –6.13% return of the Lipper International Funds Average, a peer group measure. The fund’s focus is, however, on longer term investment results. As shown in the table below, it has a proven track record of consistently generating positive returns that are superior to many of its peers. The fund’s average annual total return over the past five years also led that of the MSCI All Country World ex USA Index — this index became the fund’s primary benchmark in the fiscal year ended March 31, 2007, replacing the less geographically diverse MSCI EAFE (Europe, Australasia, Far East) Index.
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Results at a glance | ||||||||||||||||
For periods ended March 31, 2012, with all distributions reinvested | ||||||||||||||||
Total returns | Average annual total returns | |||||||||||||||
1 year | 5 years | 10 years | Lifetime | |||||||||||||
(since 4/16/84) | ||||||||||||||||
EuroPacific Growth Fund (Class A shares) –6.25% | 0.29 | % | 7.63% 11.48 | % | ||||||||||||
MSCI All Country World ex USA Index1,2 | –6.75 | –1.11 | 7.73 | — | ||||||||||||
Lipper International Funds Average | –6.13 | –2.67 | 5.78 | 9.11 | ||||||||||||
MSCI EAFE (Europe, Australasia, | ||||||||||||||||
Far East) Index1,3 | –5.31 | –3.04 | 6.16 | 9.05 | ||||||||||||
1 The indexes are unmanaged and, therefore, have no expenses. | ||||||||||||||||
2 The index did not exist prior to December 31, 1987. | ||||||||||||||||
3 This was the fund’s primary benchmark until the fiscal year ended March 31, 2007. |
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[Begin Sidebar]
In this report | |
Special feature | |
6 | Different routes to growth: in pursuit of global investment opportunities |
Including companies based in Europe, Asia and elsewhere, EuroPacific Growth Fund’s portfolio is well-diversified with investments drawn from a wide range of industries. | |
Contents | |
1 | Letter to investors |
4 | The value of a long-term perspective |
12 | Summary investment |
portfolio | |
17 | Financial statements |
35 | Board of trustees and |
other officers |
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Where the fund’s assets are invested
(percent invested by country)
EuroPacific Growth Fund invests primarily in the stocks of companies based in Europe and the Pacific Basin.1 | ||||||||||||
MSCI | ||||||||||||
All Country | ||||||||||||
EuroPacific | World ex USA | |||||||||||
Growth Fund | Index2 | |||||||||||
(3/31/12) | (3/31/11) | (3/31/12) | ||||||||||
Europe | ||||||||||||
Euro zone3 | 22.6 | % | 25.4 | % | 19.2 | % | ||||||
United Kingdom | 10.7 | 9.7 | 15.2 | |||||||||
Switzerland | 7.3 | 6.7 | 5.8 | |||||||||
Denmark | 3.5 | 3.2 | .8 | |||||||||
Sweden | 2.3 | 2.1 | 2.2 | |||||||||
Russia | 1.7 | 1.1 | 1.6 | |||||||||
Norway | .2 | .6 | .7 | |||||||||
Other Europe | .3 | .4 | .8 | |||||||||
48.6 | 49.2 | 46.3 | ||||||||||
Pacific Basin | ||||||||||||
Japan | 9.6 | 11.0 | 14.7 | |||||||||
China | 5.8 | 5.3 | 4.1 | |||||||||
South Korea | 5.0 | 3.9 | 3.6 | |||||||||
Canada | 3.8 | 3.8 | 8.1 | |||||||||
Hong Kong | 2.6 | 2.3 | 1.9 | |||||||||
Taiwan | 2.5 | 2.6 | 2.7 | |||||||||
Mexico | 2.2 | 3.1 | 1.1 | |||||||||
Australia | 1.8 | 1.7 | 5.7 | |||||||||
Indonesia | .6 | .8 | .7 | |||||||||
Other Pacific Basin | 1.6 | 1.2 | 2.8 | |||||||||
35.5 | 35.7 | 45.4 | ||||||||||
Other | ||||||||||||
India | 4.8 | 4.2 | 1.5 | |||||||||
South Africa | 1.8 | 1.7 | 1.8 | |||||||||
Brazil | 1.2 | 1.7 | 3.6 | |||||||||
Israel | 1.1 | .7 | .4 | |||||||||
Other countries | — | .1 | 1.0 | |||||||||
8.9 | 8.4 | 8.3 | ||||||||||
Short-term securities & | ||||||||||||
other assets less | ||||||||||||
liabilities | 7.0 | 6.7 | — | |||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | ||||||
1 A country is considered part of the Pacific Basin if any of its borders touches the Pacific Ocean. | ||||||||||||
2 Weighted by market capitalization. | ||||||||||||
3 Countries using the euro as a common currency: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. |
[End Sidebar]
Volatile markets, economic challenges
During the past fiscal year, there were periods lasting just days or weeks when some stock markets experienced declines and ascents of magnitudes that are more typically witnessed over several months, or even years. For example, in the week preceding the downgrade of the U.S. sovereign credit rating by rating agency Standard & Poor’s in August 2011, many markets posted double-digit declines. Then, over the next few months, markets swooned repeatedly when the European banking system seemed to be at risk of collapse due to banks’ exposure to euro zone government debt and a lack of access to funding.
Over the 12-month period, the debt crisis was the major source of global economic instability. European authorities’ decisive steps toward resolving the debt crisis in late 2011 — including a new fiscal treaty, a comprehensive bailout fund for indebted nations, a second bailout package for Greece and the provision of large-scale funding to banks by the European Central Bank (ECB) — buoyed markets. Improving investor sentiment was further lifted in February following the ECB’s second round of funding — when it extended about €530 billion worth of loans to banks. The MSCI Europe Index advanced 10.81% during the final three months of the fiscal year.
Japanese stocks also got a recent lift in the wake of central bank actions. In February 2012, the Bank of Japan unexpectedly announced that it would spend an extra ¥10 trillion on government bond purchases, and also set a near-term inflation goal of 1%. These measures helped drive the yen lower versus the U.S. dollar, which particularly benefitted Japanese companies with export-driven businesses.
Globally, the positive market sentiment moderated in March, however. There was increased concern about whether some euro zone countries could meet tough fiscal targets and implement necessary reforms as their economies struggled. Meanwhile, March data showed that China and India’s economies experienced weaker growth than many economists had anticipated. The policy stories behind moderating growth in these key developing economies are quite different. In China, regulators have sought to use policy to curb rising property prices, while the focus of India’s central bank has been to keep a lid on inflation.
Inside the portfolio
In the feature “Different routes to growth: in pursuit of global investment opportunities,” beginning on page 6, we take a closer look at some of the companies in which the fund invests. As we discuss there, whatever their size or industry, and whether they are based in Europe, Asia or elsewhere, the fund’s investments typically have one thing in common — they are financially strong companies with compelling long-term growth stories. Researching companies and thinking ahead, years into the future, our focus is on actively managing a well-diversified portfolio of investments that we believe are likely to thrive over time. This diversification and the portfolio counselors’ long-term perspective is well-reflected among the main contributors to (and detractors from) the fund’s 12-month result. Consider the fund’s seventh-largest holding, Softbank, for example. The Japanese telecommunications company endured a challenging 12 months, during which its stock price declined significantly (–25.9%). Yet, because of our positive long-term view of this company, we added to our holdings. Softbank has made key investments in the Chinese e-commerce industry. Our analysis indicates that these unique ventures are growing so rapidly that, in their own right, their worth alone could one day be higher than Softbank’s market capitalization. In addition, its core Japanese telecommunications business continues to grow and generate cash flow.
Broadly, the fund’s lower exposure (relative to the benchmark index) to stocks in the materials sector was a notable positive over the period. This positioning reflects the portfolio counselors’ caution regarding moderating growth among some developing-country economies. Another significant overall contributor to the fund’s 12-month return was its investments in information technology companies. The stock price of the fund’s second-largest investment as of March 31, 2012, Samsung Electronics, rose 32.3%. Since the fund started investing in this company in May 1997, the company has grown significantly (see feature). Meanwhile, the stock price of Netherlands-based ASML — a market leader in semiconductor lithography, the technology used by many companies, including Samsung, to manufacture chips — was up 13.4% over the fiscal year. We reduced our holdings in HTC, a competing technology company, whose stock price declined 45.7%. The fund’s investments in health care companies — including its largest holding, Novo Nordisk, whose stock price was up 10.2% — were another significant positive. Danish pharmaceutical firm Novo Nordisk’s growth story is also discussed in the feature. The fund started investing in this company in July 2000. The fund’s investments in telecommunications and financials (its largest sector exposure as of March 31, 2012) hurt overall returns most.
Looking ahead
Despite a difficult past fiscal year, continuing growth among many developing-country economies and the ongoing healing of the U.S. economy offer hope for a healthier investment environment. Moderating growth in China and India, and Europe’s structural economic problems will not be ignored. The portfolio counselors remain cognizant of the possibility that problems in the euro zone could prompt further severe stock market stress, and are guarded about the near-term economic outlook. That said, they believe that these risks are largely well-understood. Market volatility, while uncomfortable, has often provided us with attractively priced opportunities to invest in well-run companies with the financial strength to overcome near-term challenges.
We thank you for your confidence in our long-term approach to investing, and we look forward to reporting to you again in six months.
Sincerely,
/s/ Gina H. Despres
Gina H. Despres
Chairman of the Board
/s/ Carl Kawaja
Carl Kawaja
President
May 9, 2012
For current information about the fund, visit americanfunds.com.
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We are deeply saddened by the loss of Jon B. Lovelace Jr., chairman emeritus and former portfolio counselor of Capital Research and Management Company, and former chairman of The Capital Group Companies.
Nearly every aspect of the Capital Group bears some stamp of Jon’s leadership and service from 1951 until 2005. He was one of the principal architects of our Multiple Portfolio Counselor System, an early proponent of international investing, the founder of New Perspective Fund and Capital Income Builder and a standard-bearer of the Capital Group’s mission to serve investors.
Though he never sought the spotlight, his accomplishments in life, work and philanthropy will long be remembered.
[End Sidebar]
The value of a long-term perspective
Fund results shown are for Class A shares and reflect deduction of the maximum sales charge of 5.75% on the $10,000 investment.¹ Thus, the net amount invested was $9,425.² Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For current information and month-end results, visit americanfunds.com.
How a $10,000 investment has grown
While notable for their volatility in recent years, financial markets have tended to reward investors over the long term. Active management — bolstered by experience and careful research — can add even more value. As the chart shows, over its lifetime, EuroPacific Growth Fund has done demonstrably better than its relevant benchmark.
Average annual total returns based on a $1,000 investment | ||||||||||||
(for periods ended March 31, 2012)* | ||||||||||||
1 year | 5 years | 10 years | ||||||||||
Class A shares | –11.64 | % | –0.89 | % | 7.00 | % | ||||||
*Assumes reinvestment of all distributions and payment of the maximum 5.75% sales charge. |
The total annual fund operating expense ratio is 0.84% for Class A shares as of the prospectus dated June 1, 2012 (unaudited).
Investment results assume all distributions are reinvested and reflect applicable fees and expenses. When applicable, investment results reflect fee waivers, without which results would have been lower. See americanfunds.com for more information.
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FOR YEAR ENDED 3/31 | EuroPacific Growth Fund, with dividends reinvested4 | MSCI All Country World ex USA Index, with dividends reinvested5,6 | Consumer Price Index (inflation)7 | |||||||||||||||
Initial Investment | 4/16/1984 | $ | 9,425 | $ | 10,000 | $ | 10,000 | |||||||||||
1985 | Low | 7/23/1984 | 8,696 | Low | 7/23/1984 | 8,155 | Low | 04/30/84 | $ | 10,000 | ||||||||
Hi | 3/28/1985 | 9,955 | Hi | 3/31/1985 | 10,348 | Hi | 03/31/85 | 10,320 | ||||||||||
Close | 3/31/1985 | 9,941 | Close | 3/31/1985 | 10,348 | Close | 03/31/85 | 10,320 | ||||||||||
1986 | Low | 4/8/1985 | 9,775 | Low | 4/9/1985 | 10,115 | Low | 04/30/85 | 10,369 | |||||||||
Hi | 3/21/1986 | 15,364 | Hi | 3/31/1986 | 19,228 | Hi | 01/31/86 | 10,630 | ||||||||||
Close | 3/31/1986 | 15,357 | Close | 3/31/1986 | 19,228 | Close | 03/31/86 | 10,553 | ||||||||||
1987 | Low | 7/22/1986 | 15,634 | Low | 4/7/1986 | 18,448 | Low | 04/30/86 | 10,533 | |||||||||
Hi | 3/27/1987 | 19,887 | Hi | 3/27/1987 | 31,405 | Hi | 03/31/87 | 10,873 | ||||||||||
Close | 3/31/1987 | 19,813 | Close | 3/31/1987 | 31,010 | Close | 03/31/87 | 10,873 | ||||||||||
1988 | Hi | 10/8/1987 | 24,499 | Hi | 10/14/1987 | 36,201 | Low | 04/30/87 | 10,931 | |||||||||
Low | 12/11/1987 | 17,992 | Low | 11/11/1987 | 28,389 | Hi | 03/31/88 | 11,300 | ||||||||||
Close | 3/31/1988 | 21,422 | Close | 3/31/1988 | 36,179 | Close | 03/31/88 | 11,300 | ||||||||||
1989 | Low | 9/1/1988 | 21,189 | Low | 8/31/1988 | 33,481 | Low | 04/30/88 | 11,358 | |||||||||
Hi | 2/9/1989 | 24,835 | Hi | 2/28/1989 | 41,150 | Hi | 03/31/89 | 11,862 | ||||||||||
Close | 3/31/1989 | 24,569 | Close | 3/31/1989 | 40,446 | Close | 03/31/89 | 11,862 | ||||||||||
1990 | Low | 6/13/1989 | 24,282 | Hi | 12/31/1989 | 45,003 | Low | 04/30/89 | 11,940 | |||||||||
Hi | 12/6/1989 | 28,391 | Low | 3/31/1990 | 36,338 | Hi | 03/31/90 | 12,483 | ||||||||||
Close | 3/31/1990 | 28,742 | Close | 3/31/1990 | 36,338 | Close | 03/31/90 | 12,483 | ||||||||||
1991 | Hi | 7/18/1990 | 33,103 | Hi | 7/31/1990 | 40,323 | Low | 04/30/90 | 12,502 | |||||||||
Low | 1/16/1991 | 27,795 | Low | 9/30/1990 | 31,618 | Hi | 03/31/91 | 13,094 | ||||||||||
Close | 3/31/1991 | 31,359 | Close | 3/31/1991 | 37,523 | Close | 03/31/91 | 13,094 | ||||||||||
1992 | Low | 8/19/1991 | 30,061 | Hi | 12/31/1991 | 39,623 | Low | 04/30/91 | 13,113 | |||||||||
Hi | 2/28/1992 | 36,033 | Low | 3/31/1992 | 35,581 | Hi | 03/31/92 | 13,511 | ||||||||||
Close | 3/31/1992 | 35,033 | Close | 3/31/1992 | 35,581 | Close | 03/31/92 | 13,511 | ||||||||||
1993 | Hi | 6/2/1992 | 37,465 | Low | 10/31/1992 | 34,792 | Low | 04/30/92 | 13,531 | |||||||||
Low | 11/17/1992 | 33,764 | Hi | 3/31/1993 | 39,345 | Hi | 03/31/93 | 13,928 | ||||||||||
Close | 3/31/1993 | 37,728 | Close | 3/31/1993 | 39,345 | Close | 03/31/93 | 13,928 | ||||||||||
1994 | Low | 4/2/1993 | 37,813 | Low | 4/30/1993 | 42,820 | Low | 04/30/93 | 13,967 | |||||||||
Hi | 2/2/1994 | 50,611 | Hi | 1/31/1994 | 51,503 | Hi | 03/31/94 | 14,277 | ||||||||||
Close | 3/31/1994 | 47,638 | Close | 3/31/1994 | 48,772 | Close | 03/31/94 | 14,277 | ||||||||||
1995 | Hi | 9/2/1994 | 51,011 | Hi | 10/31/1994 | 53,443 | Low | 04/30/94 | 14,297 | |||||||||
Low | 1/31/1995 | 46,642 | Low | 2/16/1995 | 48,179 | Hi | 03/31/95 | 14,685 | ||||||||||
Close | 3/31/1995 | 47,974 | Close | 3/31/1995 | 50,901 | Close | 03/31/95 | 14,685 | ||||||||||
1996 | Low | 4/3/1995 | 47,928 | Low | 6/30/1995 | 51,925 | Low | 04/30/95 | 14,733 | |||||||||
Hi | 3/25/1996 | 57,612 | Hi | 3/31/1996 | 57,610 | Hi | 03/31/96 | 15,102 | ||||||||||
Close | 3/31/1996 | 57,494 | Close | 3/31/1996 | 57,610 | Close | 03/31/96 | 15,102 | ||||||||||
1997 | Low | 7/24/1996 | 57,229 | Low | 7/31/1996 | 56,809 | Low | 04/30/96 | 15,160 | |||||||||
Hi | 3/11/1997 | 67,625 | Hi | 11/30/1996 | 60,212 | Hi | 03/31/97 | 15,519 | ||||||||||
Close | 3/31/1997 | 66,627 | Close | 3/31/1997 | 59,368 | Close | 03/31/97 | 15,519 | ||||||||||
1998 | Hi | 10/3/1997 | 77,523 | Low | 4/30/1997 | 59,868 | Low | 05/31/97 | 15,529 | |||||||||
Low | 1/12/1998 | 67,131 | Hi | 3/31/1998 | 69,026 | Hi | 03/31/98 | 15,732 | ||||||||||
Close | 3/31/1998 | 80,601 | Close | 3/31/1998 | 69,026 | Close | 03/31/98 | 15,732 | ||||||||||
1999 | Hi | 4/15/1998 | 83,900 | Low | 9/30/1998 | 57,722 | Low | 04/30/98 | 15,761 | |||||||||
Low | 10/5/1998 | 65,404 | Hi | 3/31/1999 | 71,159 | Hi | 03/31/99 | 16,004 | ||||||||||
Close | 3/31/1999 | 87,198 | Close | 3/31/1999 | 71,159 | Close | 03/31/99 | 16,004 | ||||||||||
2000 | Low | 4/1/1999 | 87,833 | Low | 5/31/1999 | 71,208 | Low | 06/30/99 | 16,120 | |||||||||
Hi | 3/29/2000 | 137,516 | Hi | 3/31/2000 | 91,706 | Hi | 03/31/00 | 16,605 | ||||||||||
Close | 3/31/2000 | 134,560 | Close | 3/31/2000 | 91,706 | Close | 03/31/00 | 16,605 | ||||||||||
2001 | Hi | 4/10/2000 | 134,710 | Hi | 6/30/2000 | 87,965 | Low | 04/30/00 | 16,615 | |||||||||
Low | 3/22/2001 | 94,189 | Low | 3/22/2001 | 64,313 | Hi | 03/31/01 | 17,090 | ||||||||||
Close | 3/31/2001 | 96,853 | Close | 3/31/2001 | 67,112 | Close | 03/31/01 | 17,090 | ||||||||||
2002 | Hi | 5/21/2001 | 104,778 | Hi | 5/2/2001 | 72,556 | Low | 12/31/01 | 17,139 | |||||||||
Low | 9/21/2001 | 79,958 | Low | 9/21/2001 | 52,947 | Hi | 03/31/02 | 17,342 | ||||||||||
Close | 3/31/2002 | 94,302 | Close | 3/31/2002 | 63,226 | Close | 03/31/02 | 17,342 | ||||||||||
2003 | Hi | 5/17/2002 | 96,306 | Hi | 5/17/2002 | 65,397 | Low | 04/30/02 | 17,439 | |||||||||
Low | 3/12/2003 | 69,809 | Low | 3/12/2003 | 46,776 | Hi | 03/31/03 | 17,866 | ||||||||||
Close | 3/31/2003 | 72,463 | Close | 3/31/2003 | 49,204 | Close | 03/31/03 | 17,866 | ||||||||||
2004 | Low | 4/1/2003 | 73,091 | Low | 4/1/2003 | 49,620 | Low | 05/31/03 | 17,798 | |||||||||
High | 3/1/2004 | 114,695 | High | 2/17/2004 | 79,825 | Hi | 03/31/04 | 18,177 | ||||||||||
Close | 3/31/2004 | 113,848 | Close | 3/31/2004 | 78,684 | Close | 03/31/04 | 18,177 | ||||||||||
2005 | Low | 5/17/2004 | 103,225 | Low | 5/17/2004 | 71,764 | Low | 04/30/04 | 18,235 | |||||||||
High | 3/4/2005 | 132,976 | High | 3/8/2005 | 95,174 | Hi | 03/31/05 | 18,749 | ||||||||||
Close | 3/31/2005 | 127,604 | Close | 3/31/2005 | 91,389 | Close | 03/31/05 | 18,749 | ||||||||||
2006 | Low | 4/28/2005 | 123,628 | Low | 5/17/2005 | 88,203 | Low | 05/31/05 | 18,855 | |||||||||
High | 3/30/2006 | 166,244 | High | 3/30/2006 | 117,805 | Hi | 03/31/06 | 19,379 | ||||||||||
Close | 3/31/2006 | 166,207 | Close | 3/31/2006 | 117,092 | Close | 03/31/06 | 19,379 | ||||||||||
2007 | Low | 6/13/2006 | 150,639 | Low | 6/13/2006 | 107,730 | Low | 04/30/06 | 19,544 | |||||||||
High | 12/20/2006 | 186,512 | High | 2/26/2007 | 142,457 | Hi | 03/31/07 | 19,918 | ||||||||||
Close | 3/31/2007 | 193,850 | Close | 3/31/2007 | 140,848 | Close | 03/31/07 | 19,918 | ||||||||||
2008 | High | 10/31/2007 | 234,626 | High | 10/31/2007 | 168,788 | Low | 04/30/07 | 20,047 | |||||||||
Low | 3/19/2008 | 197,139 | Low | 1/23/2008 | 135,249 | Hi | 03/31/08 | 20,711 | ||||||||||
Close | 3/31/2008 | 206,256 | Close | 3/31/2008 | 144,476 | Close | 03/31/08 | 20,711 | ||||||||||
2009 | High | 5/19/2008 | 222,332 | High | 5/19/2008 | 160,099 | Hi | 07/31/08 | 21,335 | |||||||||
Low | 3/9/2009 | 107,894 | Low | 3/9/2009 | 66,530 | Low | 12/31/08 | 20,391 | ||||||||||
Close | 3/31/2009 | 122,641 | Close | 3/31/2009 | 77,762 | Close | 03/31/09 | 20,631 | ||||||||||
2010 | Low | 4/1/2009 | 124,925 | Low | 4/1/2009 | 78,971 | Low | 04/30/09 | 20,683 | |||||||||
High | 11/16/2009 | 188,719 | High | 1/11/2010 | 128,321 | Hi | 03/31/10 | 21,109 | ||||||||||
Close | 3/31/2010 | 186,699 | Close | 3/31/2010 | 125,715 | Close | 03/31/10 | 21,109 | ||||||||||
2011 | Low | 5/26/2010 | 160,352 | Low | 5/25/2010 | 105,899 | Low | 06/30/10 | 21,141 | |||||||||
High | 3/3/2011 | 210,765 | High | 3/4/2011 | 144,041 | Hi | 03/31/11 | 21,675 | ||||||||||
Close | 3/31/2011 | 209,834 | Close | 3/31/2011 | 142,824 | Close | 03/31/11 | 21,675 | ||||||||||
2012 | High | 5/2/2011 | 221,157 | High | 5/2/2011 | 150,751 | Low | 04/30/11 | 21,814 | |||||||||
Low | 10/3/2011 | 163,123 | Low | 10/4/2011 | 109,616 | Hi | 03/31/12 | 22,249 | ||||||||||
Close | 3/31/2012 | 196,710 | Close | 3/31/2012 | 133,187 | Close | 03/31/12 | 22,249 |
Average annual total return for fund’s lifetime: 11.2%4
$10,000 - Original investment
Year ended March 31 | 1985 | 3 | 1986 | 1987 | 1988 | 1989 | 1990 | 1991 | 1992 | |||||||||||||||||||||||
TOTAL VALUE | ||||||||||||||||||||||||||||||||
Dividends reinvested | $ | 69 | 35 | 118 | 491 | 316 | 527 | 656 | 611 | |||||||||||||||||||||||
Value at year-end | $ | 9,941 | 15,357 | 19,813 | 21,422 | 24,569 | 28,742 | 31,359 | 35,033 | |||||||||||||||||||||||
Total return | (0.6 | )% | 54.5 | 29.0 | 8.1 | 14.7 | 17.0 | 9.1 | 11.7 | |||||||||||||||||||||||
Year ended March 31 | 1993 | 1994 | 1995 | 1996 | 1997 | 1998 | 1999 | 2000 | ||||||||||||||||||||||||
TOTAL VALUE | ||||||||||||||||||||||||||||||||
Dividends reinvested | 538 | 515 | 715 | 1,131 | 1,062 | 1,155 | 991 | 841 | ||||||||||||||||||||||||
Value at year-end | 37,728 | 47,638 | 47,974 | 57,494 | 66,627 | 80,601 | 87,198 | 134,560 | ||||||||||||||||||||||||
Total return | 7.7 | 26.3 | 0.7 | 19.8 | 15.9 | 21.0 | 8.2 | 54.3 | ||||||||||||||||||||||||
Year ended March 31 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | ||||||||||||||||||||||||
TOTAL VALUE | ||||||||||||||||||||||||||||||||
Dividends reinvested | 637 | 2,209 | 836 | 1,083 | 1,796 | 2,575 | 2,899 | 4,070 | ||||||||||||||||||||||||
Value at year-end | 96,853 | 94,302 | 72,463 | 113,848 | 127,604 | 166,207 | 193,850 | 206,256 | ||||||||||||||||||||||||
Total return | (28.0 | ) | (2.6 | ) | (23.2 | ) | 57.1 | 12.1 | 30.3 | 16.6 | 6.4 | |||||||||||||||||||||
Year ended March 31 | 2009 | 2010 | 2011 | 2012 | ||||||||||||||||||||||||||||
TOTAL VALUE | ||||||||||||||||||||||||||||||||
Dividends reinvested | 3,422 | 2,959 | 2,756 | 2,892 | ||||||||||||||||||||||||||||
Value at year-end | 122,641 | 186,699 | 209,834 | 196,710 | ||||||||||||||||||||||||||||
Total return | (40.5 | ) | 52.2 | 12.4 | (6.3 | ) |
The results shown are before taxes on fund distributions and sale of fund shares.
1As outlined in the prospectus, the sales charge is reduced for accounts (and aggregated investments) of $25,000 or more and is eliminated for purchases of $1 million or more. There is no sales charge on dividends or capital gain distributions that are reinvested in additional shares. |
2The maximum initial sales charge was 8.5% prior to July 1, 1988. |
3For the period April 16, 1984 (commencement of operations), through March 31, 1985. |
4Includes reinvested dividends of $37,903 and reinvested capital gain distributions of $70,634. |
5The index is unmanaged and, therefore, has no expenses. |
6From April 16, 1984, through December 31, 1987, the MSCI EAFE Index was used because the MSCI All Country World ex USA Index did not yet exist. Since January 1, 1988, the MSCI All Country World ex USA Index has been used. |
7Computed from data supplied by the U.S. Department of Labor, Bureau of Labor Statistics. |
Different routes to growth: in pursuit of global investment opportunities
Including companies based in Europe, Asia and elsewhere, EuroPacific Growth Fund’s portfolio is well-diversified with investments drawn from a wide range of industries. Here, several of the fund’s investment professionals discuss the compelling long-term growth stories behind some of these investments.
[Begin Photo Caption]
The oil services industry has experienced volatile conditions, but Italian pipeline company Saipem has a track record of winning strategically important projects, and has consistently grown its earnings.
[End Photo Caption]
[photo of a row of planes]
[photo of a construction worker at the end of a steel pipe]
In Abuja, Nigeria, preparations gather pace for the imminent opening of a new grocery store within a shopping mall that will serve the city’s growing middle class. Nearly 4,000 miles north, in the Baltic Sea, engineers use a 3,000-ton crane to carefully lower sections of a 760-mile pipeline that will carry natural gas from Russia to Germany along the seabed. In Austin, Texas, a South Korean company races to manufacturer components for the new iPad, 3 million of which were later sold within three days of its launch. In Denmark, a company announces that its innovative diabetes treatment will soon achieve “blockbuster” status, generating $1 billion of annual sales for the Danish firm.
What do these apparently disparate events from recent months have in common? For a start, they are all associated with established longer term global growth trends — the emergence of more affluent consumers in developing countries, increasing energy demand, the rising popularity of mobile computing and, tragically, the increase in the number of diabetics. The other commonality is that they represent growth stories for a number of companies that are among the fund’s investments: South African retailer Shoprite; Italian pipeline company Saipem; South Korean firm Samsung Electronics; and Danish pharmaceuticals firm Novo Nordisk.
“Many of the fund’s larger investments are in European companies with businesses that have continued to thrive despite the troubled European economic backdrop,” says London-based portfolio counselor Mark Denning. “Overall, the portfolio is well-diversified, with most of the fund’s investments in companies from Europe and Southeast Asia. We also invest in companies in select other countries, such as South Africa. Shoprite, for example, is one of our larger investments there. It has a track record of achieving strong sales growth, and is now expanding in Nigeria and other African countries.”
The focus of EuroPacific Growth Fund’s portfolio counselors and analysts is very much on companies — financially strong ones with compelling long-term growth prospects — rather than countries or regions. The fund’s investment professionals rely on thorough research to identify firms with sound management teams and sustainable competitive advantages. Oftentimes, these companies (as in the example of Shoprite) generate substantial portions of their revenues outside of their home country or region. So, for example, although European companies continue to account for the lion’s share of the fund’s investments (48.6% of the portfolio as of March 31, 2012), it’s important to note that, increasingly, their revenues are generated elsewhere. See “Where do European companies make their money?” on page 8.
We will now crisscross the globe — offering you, the fund’s investors, a closer look at some companies that, in our view, exemplify the kinds of attributes that the fund seeks in its investments.
Visiting a leading oil services company (in a shark suit)
During a research trip in September last year, Los Angeles-based analyst Jacinto Hernandez swapped his business suit for one made of chainmail and rubber. The reason? He was flying in a helicopter high above the Baltic Sea, on his way to an offshore rig where he would meet Saipem’s senior management and see its pioneering pipelaying technology in action. Anyone unlucky enough to find themselves in the frigid Baltic waters would generally have a survival time of about two minutes. Known as a shark suit, Jacinto’s protective clothing could have bought him an additional 10 minutes had the chopper encountered difficulty. Fortunately, his 30-minute flight from Sweden was hitch-free and he reached his destination. Called the Castoro Sei, Saipem’s huge vessel was busy laying two side-by-side, 760-mile-long pipelines — consisting of 48-inch-diameter steel pipes coated in a foot of concrete — that will carry natural gas from Russia to Germany. “The oil services industry has experienced volatile conditions over the past decade, but Saipem has consistently grown its earnings,” explains Jacinto. “Historically, its capabilities have been leading-edge, and the company is often considered the first choice, or even the only choice, for projects that are especially complex due to water depth, or sea conditions,” he adds. Importantly, Saipem has been successful in winning strategic projects that tend to be less vulnerable to cancellation or delay due to changes in oil prices or the economic backdrop.
Jacinto believes that the company’s decision to invest in next-generation technology two decades ago has been key to its profitability, as has been its determination to eschew potentially profitable contracts with an unfavorable balance of risk and reward. As global energy demand grows, Saipem is trying to stay ahead of the pack. “With many of its competitors finally closing the gap, Saipem is now, once again, investing heavily in the next generation of vessels. In my view, this should help sustain its leadership for the foreseeable future,” says Jacinto. As of late January, one unfinished vessel (the Castorone, which is under construction in Singapore) had already been booked for offshore projects worth billions of dollars. These include one gas export pipeline off the Gulf of Mexico in 2013, and another off the northern coast of Australia during the following year.
Selling enough beer to fill more than 13,000 Olympic-size swimming pools
Anheuser-Busch InBev — the fund’s ninth-largest holding as of March 31, 2012 — is another European company with a long-term growth story that stretches far beyond the continent’s borders. London-based analyst Juliette Amos says that a clear, well-executed, long-term strategic vision and financially savvy senior management are among the Belgium-based company’s main strengths. “The senior management has a track record of generating very high margins from the businesses they have run,” says Juliette. “Several years ago, our understanding of what they were trying to do — plus our analyses of the business, its competition and future demand — gave us confidence in their abilities to execute a growth strategy with great potential. And, in our view, this potential was not being reflected in its stock price.”
[Begin Sidebar]
Where do European companies make their money?
The proportion of total revenues that European companies derive from developed Europe has decreased dramatically — falling from about 71% in 1997 to just below 54% at the end of 2011. While the Americas region accounts for the next-largest proportion, the real growth engine has been developing markets in Latin America and Asia. Solid overall growth in developing markets means that they account for a higher percentage of European companies’ total revenues — rising from about 21% in 2007 to just over 29% in 2011.
Revenues: an increasingly global scope ...
[begin line chart]
North America & Latin America | Middle East & Africa | Asia | ||||||||
2007 | 20.6 | % | 3.3 | % | 7.9 | % | ||||
2009 | 21.0 | 4.2 | 9.0 | |||||||
2011* | 22.8 | 4.3 | 13.5 | |||||||
2012* | 22.9 | 4.4 | 14.0 |
[end line chart]
... driven by developing markets
[begin bar chart]
2007 | 2009 | 2011 | * | |||||||||
Developing Asia | 7 | % | 8 | % | 12 | % | ||||||
Latin America | 5 | 6 | 7 | |||||||||
Middle East & Africa | 3 | 4 | 4 | |||||||||
Developing Europe | 6 | 6 | 6 |
21 | 23 | 29 |
[end bar chart]
Source: Morgan Stanley Research. Figures based on company financial data and Morgan Stanley Research estimates for companies comprising the MSCI Europe Index. The MSCI Europe Index is a free float-adjusted market capitalization-weighted index that measures equity market results in the developed markets in Europe, consisting of more than 15 developed-market country indexes. Developing markets are defined as World ex Developed Europe, North America, Australasia and Japan.
*Data for 2011 and 2012 are year-end estimates.
[End Sidebar]
Over recent years, through mergers and acquisitions and then the eventual sale of most of its European assets, the company has refocused on the Americas and select developing markets, such as China. It’s important to note that execution of this strategy involved InBev’s purchase of Anheuser-Busch in 2009 — the largest ever cash-only consumer products company acquisition. This was no mean feat. The deal was completed during the financial crisis, at a time when financing was very difficult to come by. Since then, the company has rapidly reduced its debt, while increasing its margins, cash generation and dividend payout.
“It has a healthy balance sheet and is seeking to radically improve the efficiency of its North American operations. The company is also transforming its product portfolio mix there by shifting consumers from its sub-premium brands into its higher margin mainstream one: Budweiser,” explains Juliette. In 2011, global sales of the Budweiser brand alone increased 3.1% to reach 993 million gallons. The company’s total global sales of beer last year was 8.96 billion gallons — that’s enough beer to fill 13,560 Olympic-size swimming pools — with about 3% volume growth (equivalent to nearly 400 pools-worth of additional beer sales).
Juliette’s analyses suggest that most of the global beer economy’s growth over the next decade will come from the Americas. With about 50% market share in the U.S., and 70% in Brazil (another major market, where demographic trends indicate that beer consumption could rise significantly), the company could be a major beneficiary of the world’s growing thirst for beer.
A South Korean chip manufacturer … in Texas
In many ways, Samsung Electronics — the fund’s second-largest investment as of March 31, 2012 — exemplifies the fund’s commitment to thorough research and its long-term approach to investing. “The fund first began investing in Samsung Electronics in May 1997, when our research highlighted it as a well-run, competitive company with what we believed to be growth potential that was not widely appreciated,” says Mark.
Over recent years, Tokyo-based analyst Paul Li has tracked the company’s transformation from a business largely centered on memory microchips to one that now also boasts thriving divisions focused on logic microchips, smartphones and other consumer electronics. According to Paul, Apple’s historical reliance on Samsung’s components is indicative of the South Korean firm’s preeminence. “Although they are commercial rivals in smartphones, Samsung is one of Apple’s largest suppliers and Apple is one of Samsung’s largest customers.” Samsung’s A5 processor — the “brain” of the latest iPhones and iPads — is manufactured by Samsung in Austin, Texas.
In coming years, Samsung’s early investment in innovative organic LED display technology could, Paul believes, potentially become a new company growth engine. In the interim, it should continue to benefit from the rising popularity of smartphones — especially as their average price drops. “Once the $100 price point is reached, smartphones will become affordable to billions, rather than hundreds of millions, of people. I anticipate that global sales of these mobile devices — and therefore the Samsung displays and mobile processors that so many of them include — will rise dramatically,” Paul adds.
[Begin Sidebar]
EuroPacific Growth Fund’s portfolio counselors — a natural diversifier
The fund is primarily managed by 10 portfolio counselors, each of whom independently manages a portion of the fund’s assets, subject to the fund’s objectives and overall guidelines. A group of analysts also manages a portion of total assets. Different investment experiences and points of view naturally create a blend of approaches and styles. This can help reduce the volatility of fund returns — especially during difficult market environments — and has tended to deliver consistent results over longer time periods.
Portfolio counselors and years of investment experience (as of 3/31/12)
[Begin Photo Caption]
[photo of Stephen Bepler]
Stephen Bepler
46 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Mark Denning]
Mark Denning
30 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Rob Lovelace]
Rob Lovelace
27 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Carl Kawaja]
Carl Kawaja
25 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Nick Grace]
Nick Grace
22 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Jonathan Knowles]
Jonathan Knowles
20 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Andrew Suzman]
Andrew Suzman
19 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Sung Lee]
Sung Lee
18 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Jesper Lyckeus]
Jesper Lyckeus
17 years
[End Photo Caption]
[Begin Photo Caption]
[photo of Chris Thomsen]
Chris Thomsen
14 years
[End Photo Caption]
[photo of a cellphone in a persons' hand]
[Begin Pull Quote]
“Once the $100 price point is reached, smartphones will become affordable to billions, rather than hundreds of millions, of people.”
— Paul Li, investment analyst
[End Pull Quote]
[End Sidebar]
A food giant that’s growing almost everywhere
Innovation is, of course, not limited to technology companies. Food company Nestlé, the fund’s fifth-largest holding as of March 31, 2012, is a case in point. “Nestlé is unusual in that it is a very large firm that has maintained rapid growth over the last decade. Innovation has played a vital role,” explains Geneva-based analyst Georgios Damtsas. “It has grown its sales in developed and developing countries — even in Greece and other embattled European economies.”
In Europe, Georgios says that the Swiss company has successfully introduced a range of products over recent years, and offers two examples from its coffee business. “For more budget-conscious consumers, it introduced a three-in-one sachet that includes milk, sugar and coffee. This was originally an innovation that did well in emerging markets,” he explains. “At the other end of the price spectrum, its Nespresso product line — air-tight aluminum capsules of premium coffee selected from the top 1% of green coffee production — has been very successful. Sold only over the Internet, by telephone or in dedicated stores, Nespresso’s annual sales growth has exceeded 20%.”
In recent years, the company has sought to build on its long history of operating in developing countries with large acquisitions in China, and by bolstering manufacturing facilities elsewhere. “Changing lifestyles and demographics mean that appetite for its products in some developing markets is growing so fast that it has struggled to meet demand. To help secure its future growth, the company is building numerous factories in Asia and Africa,” adds Georgios.
A health care company tackles an epidemic
Sadly, there are downsides to the changing demographics and increased wealth in many developing countries. Rising affluence and urbanization are leading to more sedentary lifestyles, unhealthy diets and related diseases such as type-2 diabetes. The number of diabetics in China and India alone is expected to increase by tens of millions over the next couple of decades.
Novo Nordisk is a health care company that focuses on diabetes-related products, particularly insulin. As of March 31, 2012, it was the fund’s largest investment. “Novo Nordisk is the largest manufacturer of insulin, so demand for its main product looks set to expand as the diabetes epidemic continues to unfold over coming decades,” says San Francisco-based analyst Eric Keisman. Meanwhile, the company is looking to also tap other sources of growth. For example, it is conducting clinical trials to establish whether one of its newer diabetes drugs (Victoza) could be suitable for the treatment of obesity. In addition to controlling blood sugar, Victoza causes weight loss — dramatically so, in some patients. Novo Nordisk is trying to find out whether very obese patients, who are also at risk for developing diabetes, could benefit as well. “The trials examine whether the drug can induce weight loss safely in obese patients. It’s still in its early days, but there’s real potential for the sales growth of Victoza to accelerate.”
The Danish company has a significant presence in developing countries, and a substantial proportion of its growth comes from there, as well as from the U.S. So, just as has been the case with the different companies highlighted here, the drivers of Novo Nordisk’s growth are diversified, and supported by what appears to be a longer term trend.
“The global economy faces challenges — most notably, in Europe — and the fund’s portfolio counselors remain guarded about the near-term outlook,” cautions San Francisco-based portfolio counselor Carl Kawaja. “Still, with its well-diversified portfolio and our commitment to thorough company-specific research, we believe that the fund is well-positioned to deliver longer term growth to its investors. In our experience, turbulent markets often provide the best long-term investment opportunities.”n
Tapping global potential | ||||
1987 | 1988 | 1989 | 1990 | 1991 |
MSCI All | MSCI All | MSCI | MSCI | MSCI |
Country World | Country World | USA Index | USA Index | USA Index |
ex USA Index | ex USA Index | |||
+25%* (black) | +28% (black) | +31% (red) | –2% (red) | +31% (red) |
+4% (red) | +16% (red) | +12% (black) | –23% (black) | +14% (black) |
1992 | 1993 | 1994 | 1995 | 1996 |
MSCI | MSCI All | MSCI All | MSCI | MSCI |
USA Index | Country World | Country World | USA Index | USA Index |
ex USA Index | ex USA Index | |||
+7% (red) | +35% (black) | +7% (black) | +38% (red) | +24% (red) |
–11% (black) | +10% (red) | +2% (red) | +10% (black) | +7% (black) |
1997 | 1998 | 1999 | 2000 | 2001 |
MSCI | MSCI | MSCI All | MSCI | MSCI |
USA Index | USA Index | Country World | USA Index | USA Index |
ex USA Index | ||||
+34% (red) | +31% (red) | +31% (black) | –13% (red) | –12% (red) |
+2% (black) | +14% (black) | +22% (red) | –15% (black) | –19% (black) |
2002 | 2003 | 2004 | 2005 | 2006 |
MSCI All | MSCI All | MSCI All | MSCI All | MSCI All |
Country World | Country World | Country World | Country World | Country World |
ex USA Index | ex USA Index | ex USA Index | ex USA Index | ex USA Index |
–15% (black) | +41% (black) | +21% (black) | +17% (black) | +27% (black) |
–23% (red) | +29% (red) | +11% (red) | +6% (red) | +15% (red) |
2007 | 2008 | 2009 | 2010 | 2011 |
MSCI All | MSCI | MSCI All | MSCI | MSCI |
Country World | USA Index | Country World | USA Index | USA Index |
ex USA Index | ex USA Index | |||
+17% (black) | –37% (red) | +42% (black) | +15% (red) | +2% (red) |
+6% (red) | –45% (black) | +27% (red) | +12% (black) | –13% (black) |
The table above compares total returns for the unmanaged MSCI All Country World ex USA Index (shown in black) and the MSCI USA Index (shown in red) over the past 25 calendar years.
*Inception date of the MSCI All Country World ex USA Index is December 31, 1987; data prior to that is based on the MSCI EAFE (Europe, Australasia, Far East) Index.
A world of opportunity
With more than half of the world’s investment opportunities located beyond our shores, an international focus gives U.S. investors access to growth potential that would otherwise be out of reach. As the chart shows, international stocks have outpaced their U.S. counterparts in 12 of the past 25 calendar years. Diversifying across U.S. and non-U.S. stock markets can also help investors mitigate fluctuations in the value of their investments.
Active management
Negotiating the unfamiliar terrain of international markets can be challenging. That is why so many people choose to invest overseas through professionally managed mutual funds. EuroPacific Growth Fund draws on the global research experience of its investment adviser, Capital Research and Management Company, to find attractive companies based chiefly in Europe and the Pacific Basin.
Summary investment portfolio March 31, 2012
The following summary investment portfolio is designed to streamline the report and help investors better focus on the fund’s principal holdings. See the inside back cover for details on how to obtain a complete schedule of portfolio holdings.
[begin pie chart]
Industry sector diversification (percent of net assets) | ||||
Financials | 16.92 | % | ||
Consumer discretionary | 12.62 | |||
Consumer staples | 10.69 | |||
Health care | 10.19 | |||
Information technology | 10.17 | |||
Other industries | 32.28 | |||
Bonds & notes | 0.10 | |||
Short-term securities & other assets less liabilities | 7.03 |
[end pie chart]
Country diversification | (percent of net assets) | |||
Euro zone* | 22.6 | % | ||
United Kingdom | 10.7 | |||
Japan | 9.6 | |||
Switzerland | 7.3 | |||
China | 5.8 | |||
South Korea | 5.0 | |||
India | 4.8 | |||
Canada | 3.8 | |||
Denmark | 3.5 | |||
Hong Kong | 2.6 | |||
Taiwan | 2.5 | |||
Sweden | 2.3 | |||
Mexico | 2.2 | |||
Other countries | 10.3 | |||
Short-term securities & other assets less liabilities | 7.0 | |||
* Countries using the euro as a common currency; those represented in the fund's portfolio are Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Portugal and Spain. |
Percent | ||||||||||||
Value | of net | |||||||||||
Common stocks - 92.87% | Shares | (000 | ) | assets | ||||||||
Financials - 16.92% | ||||||||||||
Prudential PLC | 90,654,384 | 1,083,888 | 1.07 | |||||||||
Major life insurance and pension provider with operations in the U.S., U.K. and Asia-Pacific region. | ||||||||||||
Housing Development Finance Corp. Ltd. | 69,939,297 | 924,332 | .91 | |||||||||
Offers home loans and other financial services through a network of offices in India. | ||||||||||||
Deutsche Bank AG | 16,980,552 | 844,845 | .83 | |||||||||
Provides corporate banking, investment banking and worldwide asset management. | ||||||||||||
Barclays PLC | 206,233,323 | 776,020 | .77 | |||||||||
One of the largest retail and commercial banking groups in the U.K. | ||||||||||||
UniCredit SpA | 127,901,060 | 640,705 | .63 | |||||||||
Operates one of the largest banking networks in Italy, with a significant presence in Eastern Europe. | ||||||||||||
Agricultural Bank of China, Class H | 1,485,594,000 | 637,048 | .63 | |||||||||
One of the largest banks in China. | ||||||||||||
HDFC Bank Ltd. | 56,659,394 | 578,160 | .57 | |||||||||
Provides financial services and a wide array of commercial, transactional and electronic banking products. | ||||||||||||
Other securities | 11,646,809 | 11.51 | ||||||||||
17,131,807 | 16.92 | |||||||||||
Consumer discretionary - 12.62% | ||||||||||||
Honda Motor Co., Ltd. | 29,509,250 | 1,121,259 | 1.11 | |||||||||
Develops, manufactures and sells automobiles, motorcycles and power equipment. | ||||||||||||
Volkswagen AG, nonvoting preferred | 4,134,575 | 727,058 | .72 | |||||||||
Europe's largest automobile manufacturer. Its brands include Audi, Bentley, Bugatti and Lamborghini. | ||||||||||||
Kia Motors Corp. | 9,601,717 | 627,940 | .62 | |||||||||
One of South Korea's leading automobile manufacturers. | ||||||||||||
Hyundai Motor Co. | 3,005,890 | 618,130 | .61 | |||||||||
South Korea's leading automobile manufacturer. | ||||||||||||
Bayerische Motoren Werke AG | 6,246,000 | 561,711 | .56 | |||||||||
One of the world's leading luxury car manufacturers (BMW). | ||||||||||||
Tata Motors Ltd. | 99,854,955 | 539,505 | .53 | |||||||||
Automobile manufacturer based in India, with operations in the UK, South Korea, Thailand, Spain and South Africa. | ||||||||||||
Daimler AG | 8,578,088 | 517,229 | ||||||||||
Daimler AG (New York registered) | 125,000 | 7,564 | .52 | |||||||||
One of the world's largest automakers and heavy truck manufacturers. | ||||||||||||
Li & Fung Ltd. | 226,130,000 | 518,912 | .51 | |||||||||
Major consumer products global sourcing and logistics service provider. | ||||||||||||
Other securities | 7,534,701 | 7.44 | ||||||||||
12,774,009 | 12.62 | |||||||||||
Consumer staples - 10.69% | ||||||||||||
Nestlé SA | 27,091,200 | 1,704,642 | 1.68 | |||||||||
Global packaged food and beverage company based in Switzerland. | ||||||||||||
British American Tobacco PLC | 26,014,999 | 1,310,954 | 1.29 | |||||||||
The world's second-largest tobacco company. | ||||||||||||
Anheuser-Busch InBev NV | 17,544,623 | 1,281,812 | ||||||||||
Anheuser-Busch InBev NV, VVPR STRIPS (1) | 10,093,238 | 40 | 1.27 | |||||||||
One of the world's largest brewers. | ||||||||||||
Pernod Ricard SA | 6,096,672 | 637,481 | .63 | |||||||||
Produces wine, spirits and nonalcoholic beverages. | ||||||||||||
Danone SA | 8,502,168 | 593,048 | .59 | |||||||||
One of the world's largest food manufacturers and a leader in dairy products, bottled water and biscuits. | ||||||||||||
Other securities | 5,290,837 | 5.23 | ||||||||||
10,818,814 | 10.69 | |||||||||||
Health care - 10.19% | ||||||||||||
Novo Nordisk A/S, Class B | 22,139,400 | 3,065,272 | 3.03 | |||||||||
A global leader in drugs to treat diabetes. | ||||||||||||
Novartis AG | 34,036,725 | 1,883,765 | 1.86 | |||||||||
One of the world's largest pharmaceutical companies. | ||||||||||||
Bayer AG | 19,450,425 | 1,368,130 | 1.35 | |||||||||
Makes pharmaceuticals and over-the-counter medicines, and develops medical diagnostic equipment. | ||||||||||||
Teva Pharmaceutical Industries Ltd. (ADR) | 24,512,300 | 1,104,524 | 1.09 | |||||||||
The leading drug company in Israel, and one of the largest generic drug companies in the U.S. | ||||||||||||
Roche Holding AG | 4,572,007 | 795,682 | .79 | |||||||||
A world leader in pharmaceuticals and diagnostic research. | ||||||||||||
CSL Ltd. | 14,104,329 | 524,352 | .52 | |||||||||
Develops pharmaceuticals, including vaccines and products derived from human plasma. | ||||||||||||
Other securities | 1,570,629 | 1.55 | ||||||||||
10,312,354 | 10.19 | |||||||||||
Information technology - 10.17% | ||||||||||||
Samsung Electronics Co. Ltd. | 2,049,475 | 2,306,236 | ||||||||||
Samsung Electronics Co. Ltd., nonvoting preferred | 48,800 | 34,240 | 2.31 | |||||||||
Korea's top electronics manufacturer and a global leader in semiconductor production. | ||||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 408,265,136 | 1,174,396 | ||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 5,822,723 | 88,971 | 1.25 | |||||||||
One of the world's largest semiconductor manufacturers. | ||||||||||||
HTC Corp. | 36,059,010 | 729,378 | .72 | |||||||||
Manufactures mobile computing and communications devices. | ||||||||||||
SAP AG | 5,617,000 | 392,249 | ||||||||||
SAP AG (ADR) | 2,625,000 | 183,278 | .57 | |||||||||
A leading developer of software for business applications. Also provides information technology services. | ||||||||||||
ASML Holding NV | 11,330,222 | 566,365 | .56 | |||||||||
A leading supplier of lithography equipment used in manufacturing semiconductors. | ||||||||||||
Tencent Holdings Ltd. | 19,585,000 | 546,273 | .54 | |||||||||
Major Internet service portal in China. | ||||||||||||
Murata Manufacturing Co., Ltd. | 8,999,700 | 533,328 | .53 | |||||||||
Global supplier of passive electronic components used in data processing, consumer electronics and telecommunications. | ||||||||||||
Infineon Technologies AG | 49,795,000 | 509,111 | .50 | |||||||||
Designs and manufactures semiconductors used in communications, automotive, computer and industrial electronics. | ||||||||||||
Other securities | 3,227,077 | 3.19 | ||||||||||
10,290,902 | 10.17 | |||||||||||
Industrials - 9.12% | ||||||||||||
Schneider Electric SA | 12,570,156 | 821,308 | .81 | |||||||||
An international supplier of industrial electrical equipment and industrial automation equipment. | ||||||||||||
Ryanair Holdings PLC (ADR) (1) | 17,233,200 | 625,220 | .62 | |||||||||
European discount airline serving Continental Europe, Ireland and the United Kingdom. | ||||||||||||
European Aeronautic Defence and Space Co. EADS NV | 12,570,890 | 514,794 | .51 | |||||||||
Major European aerospace company focused on the manufacture of civil and military aircraft, space and propulsion systems, missiles and defense products. | ||||||||||||
Other securities | 7,275,526 | 7.18 | ||||||||||
9,236,848 | 9.12 | |||||||||||
Telecommunication services - 6.80% | ||||||||||||
América Móvil, SAB de CV, Series L (ADR) | 73,597,402 | 1,827,424 | ||||||||||
América Móvil, SAB de CV, Series L | 140,040,000 | 174,369 | 1.98 | |||||||||
Latin America's largest integrated communications provider. | ||||||||||||
SOFTBANK CORP. | 45,607,900 | 1,348,345 | 1.33 | |||||||||
Internet and telecommunications conglomerate and distributor of digital media and software. | ||||||||||||
MTN Group Ltd. | 36,324,200 | 639,355 | .63 | |||||||||
Major telecommunications provider serving Africa and the Middle East. | ||||||||||||
Other securities | 2,895,746 | 2.86 | ||||||||||
6,885,239 | 6.80 | |||||||||||
Materials - 6.43% | ||||||||||||
Syngenta AG | 1,892,815 | 654,423 | .65 | |||||||||
One of the world's largest agrochemical companies. Develops seeds and crop protection products. | ||||||||||||
Linde AG | 3,095,500 | 555,485 | .55 | |||||||||
Major industrial gas company headquartered in Germany. | ||||||||||||
Other securities | 5,302,715 | 5.23 | ||||||||||
6,512,623 | 6.43 | |||||||||||
Energy - 6.40% | ||||||||||||
BP PLC | 123,652,164 | 914,839 | .90 | |||||||||
One of the world's largest oil companies. | ||||||||||||
Royal Dutch Shell PLC, Class B | 12,402,000 | 436,315 | ||||||||||
Royal Dutch Shell PLC, Class B (ADR) | 1,292,999 | 91,325 | .52 | |||||||||
A global group of energy and oil companies. | ||||||||||||
OAO Gazprom (ADR) | 52,608,000 | 641,818 | .63 | |||||||||
The largest natural gas producer and transporter in Russia. | ||||||||||||
Canadian Natural Resources, Ltd. | 17,172,600 | 569,178 | .56 | |||||||||
One of Canada's largest oil and natural gas producers. | ||||||||||||
Other securities | 3,823,746 | 3.79 | ||||||||||
6,477,221 | 6.40 | |||||||||||
Utilities - 1.97% | ||||||||||||
Other securities | 1,990,988 | 1.97 | ||||||||||
MISCELLANEOUS - 1.56% | ||||||||||||
Other common stocks in initial period of acquisition | 1,575,691 | 1.56 | ||||||||||
Total common stocks (cost: $69,736,900,000) | 94,006,496 | 92.87 | ||||||||||
Percent | ||||||||||||
Principal | Value | of net | ||||||||||
Bonds & notes - 0.10% | amount (000) | (000 | ) | assets | ||||||||
Bonds & notes of U.S. government agencies - 0.10% | ||||||||||||
Freddie Mac 1.25% 2012 | 100,000 | 100,092 | .10 | |||||||||
Total bonds & notes (cost: $100,092,000) | 100,092 | .10 | ||||||||||
Percent | ||||||||||||
Principal | Value | of net | ||||||||||
Short-term securities - 6.98% | amount (000) | (000 | ) | assets | ||||||||
Fannie Mae 0.07%-0.23% due 4/17/2012-1/9/2013 | 2,120,550 | 2,119,027 | 2.10 | |||||||||
Freddie Mac 0.065%-0.16% due 4/2-11/2/2012 | 1,862,968 | 1,862,143 | 1.84 | |||||||||
Federal Home Loan Bank 0.08%-0.25% due 4/25/2012-2/4/2013 | 1,176,976 | 1,176,491 | 1.16 | |||||||||
U.S. Treasury Bills 0.072%-0.185% due 4/19-8/23/2012 | 787,375 | 787,173 | .78 | |||||||||
Other securities | 1,115,528 | 1.10 | ||||||||||
7,060,362 | 6.98 | |||||||||||
Total short-term securities (cost: $7,060,382,000) | 7,060,362 | 6.98 | ||||||||||
Total investment securities (cost: $76,897,374,000) | 101,166,950 | 99.95 | ||||||||||
Other assets less liabilities | 53,325 | .05 | ||||||||||
Net assets | $ | 101,220,275 | 100.00 | % |
As permitted by U.S. Securities and Exchange Commission (SEC) regulations, "Miscellaneous" securities include holdings in their first year of acquisition that have not previously been publicly disclosed. | |||
"Other securities" includes all issues that are not disclosed separately in the summary investment portfolio, including securities which were valued under fair value procedures adopted by authority of the board of trustees. The total value of all such securities was $237,619,000, which represented .23% of the net assets of the fund. Some securities included in "Other securities" (with an aggregate value of $846,815,000, which represented .84% of the net assets of the fund) were acquired in transactions exempt from registration under Rule 144A or section 4(2) of the Securities Act of 1933 and may be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. |
Investments in affiliates | ||||||
A company is considered to be an affiliate of the fund under the Investment Company Act of 1940 if the fund's holdings in that company represent 5% or more of the outstanding voting shares. The value of the fund's holdings in affiliated companies is included in "Other securities" under the respective industry sectors in the summary investment portfolio. Further details on these holdings and related transactions during the year ended March 31, 2012, appear below. |
Beginning shares | Additions | Reductions | Ending shares | Dividend income (000) | Value of affiliate at 3/31/2012 (000) | |||||||||||||||||||
UCB SA | 11,918,602 | - | - | 11,918,602 | $ | 14,705 | $ | 514,230 | ||||||||||||||||
Capita Group PLC (2) | 31,129,005 | - | 2,041,000 | 29,088,005 | 10,434 | - | ||||||||||||||||||
Nexen Inc. (2) | - | 21,080,000 | - | 21,080,000 | 2,648 | - | ||||||||||||||||||
Nexen Inc. (CAD Denominated) (2) | 6,228,831 | 70,341 | 6,299,172 | - | 805 | - | ||||||||||||||||||
Nitto Denko Corp. (2) | 6,910,700 | 2,230,600 | 1,445,600 | 7,695,700 | 10,687 | - | ||||||||||||||||||
Techtronic Industries Co. Ltd. (2) | 86,710,000 | - | 42,895,000 | 43,815,000 | 1,116 | - | ||||||||||||||||||
$ | 40,395 | $ | 514,230 |
The following footnotes apply to either the individual securities noted or one or more of the securities aggregated and listed as a single line item. | |||
(1) Security did not produce income during the last 12 months. | |||
(2) Unaffiliated issuer at 3/31/2012. | |||
Key to abbreviations | |||
ADR = American Depositary Receipts | |||
CAD = Canadian dollars | |||
The descriptions of the companies shown in the summary investment portfolio, which were obtained from published reports and other sources believed to be reliable, are supplemental and are not covered by the Report of Independent Registered Public Accounting Firm. | |||
See Notes to Financial Statements |
Financial statements
Statement of assets and liabilities | ||||||||
at March 31, 2012 | (dollars in thousands) | |||||||
Assets: | ||||||||
Investment securities, at value: | ||||||||
Unaffiliated issuers (cost: $76,367,609) | $ | 100,652,720 | ||||||
Affiliated issuer (cost: $529,765) | 514,230 | $ | 101,166,950 | |||||
Cash denominated in currencies other than U.S. dollars | ||||||||
(cost: $34,331) | 34,344 | |||||||
Cash | 1,476 | |||||||
Unrealized appreciation on open forward currency contracts | 5,113 | |||||||
Receivables for: | ||||||||
Sales of investments | 169,413 | |||||||
Sales of fund's shares | 295,760 | |||||||
Dividends and interest | 307,013 | 772,186 | ||||||
101,980,069 | ||||||||
Liabilities: | ||||||||
Unrealized depreciation on open forward currency contracts | 7,870 | |||||||
Payables for: | ||||||||
Purchases of investments | 398,829 | |||||||
Repurchases of fund's shares | 262,364 | |||||||
Investment advisory services | 36,355 | |||||||
Services provided by related parties | 33,005 | |||||||
Trustees' deferred compensation | 3,005 | |||||||
Non-U.S. taxes | 16,622 | |||||||
Other | 1,744 | 751,924 | ||||||
Net assets at March 31, 2012 | $ | 101,220,275 | ||||||
Net assets consist of: | ||||||||
Capital paid in on shares of beneficial interest | $ | 91,274,493 | ||||||
Distributions in excess of net investment income | (66,008 | ) | ||||||
Accumulated net realized loss | (14,237,856 | ) | ||||||
Net unrealized appreciation | 24,249,646 | |||||||
Net assets at March 31, 2012 | $ | 101,220,275 |
(dollars and shares in thousands, except per-share amounts) | ||||||||||||
Shares of beneficial interest issued and outstanding (no stated par value) - | ||||||||||||
unlimited shares authorized (2,577,682 total shares outstanding) | ||||||||||||
Net assets | Shares outstanding | Net asset value per share | ||||||||||
Class A | $ | 31,443,303 | 796,624 | $ | 39.47 | |||||||
Class B | 464,265 | 11,844 | 39.20 | |||||||||
Class C | 2,110,704 | 54,727 | 38.57 | |||||||||
Class F-1 | 7,398,522 | 188,415 | 39.27 | |||||||||
Class F-2 | 5,958,453 | 151,079 | 39.44 | |||||||||
Class 529-A | 927,800 | 23,718 | 39.12 | |||||||||
Class 529-B | 52,189 | 1,352 | 38.61 | |||||||||
Class 529-C | 320,883 | 8,365 | 38.36 | |||||||||
Class 529-E | 49,961 | 1,287 | 38.82 | |||||||||
Class 529-F-1 | 65,400 | 1,672 | 39.11 | |||||||||
Class R-1 | 299,979 | 7,870 | 38.12 | |||||||||
Class R-2 | 1,097,941 | 28,603 | 38.39 | |||||||||
Class R-3 | 6,921,955 | 178,727 | 38.73 | |||||||||
Class R-4 | 12,490,096 | 321,998 | 38.79 | |||||||||
Class R-5 | 14,015,784 | 355,499 | 39.43 | |||||||||
Class R-6 | 17,603,040 | 445,902 | 39.48 | |||||||||
See Notes to Financial Statements |
Statement of operations | ||||||||
for the year ended March 31, 2012 | (dollars in thousands) | |||||||
Investment income: | ||||||||
Income: | ||||||||
Dividends (net of non-U.S. taxes of $274,681; | ||||||||
also includes $40,395 from affiliates) | $ | 2,494,987 | ||||||
Interest | 14,019 | $ | 2,509,006 | |||||
Fees and expenses*: | ||||||||
Investment advisory services | 431,388 | |||||||
Distribution services | 211,973 | |||||||
Transfer agent services | 102,703 | |||||||
Administrative services | 34,122 | |||||||
Reports to shareholders | 3,675 | |||||||
Registration statement and prospectus | 1,307 | |||||||
Trustees' compensation | 318 | |||||||
Auditing and legal | 234 | |||||||
Custodian | 20,958 | |||||||
State and local taxes | 888 | |||||||
Other | 1,711 | 809,277 | ||||||
Net investment income | 1,699,729 | |||||||
Net realized loss and unrealized depreciation | ||||||||
on investments, forward currency contracts and currency: | ||||||||
Net realized (loss) gain on: | ||||||||
Investments (net of non-U.S. taxes of $484; also includes $47,146 net loss from affiliates) | (2,038,451 | ) | ||||||
Forward currency contracts | 81,364 | |||||||
Currency transactions | (4,395 | ) | (1,961,482 | ) | ||||
Net unrealized depreciation on: | ||||||||
Investments (net of non-U.S. taxes of $16,622) | (7,055,840 | ) | ||||||
Forward currency contracts | (2,386 | ) | ||||||
Currency translations | (3,087 | ) | (7,061,313 | ) | ||||
Net realized loss and unrealized depreciation | ||||||||
on investments, forward currency contracts and currency | (9,022,795 | ) | ||||||
Net decrease in net assets resulting | ||||||||
from operations | $ | (7,323,066 | ) | |||||
(*) Additional information related to class-specific fees and expenses is included | ||||||||
in the Notes to Financial Statements. | ||||||||
See Notes to Financial Statements | ||||||||
Statements of changes in net assets | ||||||||
(dollars in thousands) | ||||||||
Year ended March 31 | ||||||||
2012 | 2011 | |||||||
Operations: | ||||||||
Net investment income | $ | 1,699,729 | $ | 1,416,826 | ||||
Net realized (loss) gain on investments, forward currency contracts and currency transactions | (1,961,482 | ) | 1,659,466 | |||||
Net unrealized (depreciation) appreciation on investments, forward currency contracts and currency translations | (7,061,313 | ) | 9,217,676 | |||||
Net (decrease) increase in net assets resulting from operations | (7,323,066 | ) | 12,293,968 | |||||
Dividends paid to shareholders from net investment income | (1,573,681 | ) | (1,525,621 | ) | ||||
Net capital share transactions | (3,145,194 | ) | 14,474 | |||||
Total (decrease) increase in net assets | (12,041,941 | ) | 10,782,821 | |||||
Net assets: | ||||||||
Beginning of year | 113,262,216 | 102,479,395 | ||||||
End of year (including distributions in excess of | ||||||||
net investment income: $(66,008) and $(281,090), respectively) | $ | 101,220,275 | $ | 113,262,216 | ||||
See Notes to Financial Statements |
Notes to financial statements
1. | Organization |
EuroPacific Growth Fund (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks long-term growth of capital by investing primarily in the securities of companies based in Europe and the Pacific Basin. Shareholders approved a proposal to reorganize the fund from a Massachusetts business trust to a Delaware statutory trust. The reorganization may be completed in 2012; however, the fund reserves the right to delay the implementation.
The fund has 16 share classes consisting of five retail share classes (Classes A, B and C, as well as two F share classes, F-1 and F-2), five 529 college savings plan share classes and six retirement plan share classes. The 529 college savings plan share classes (Classes 529-A, 529-B, 529-C, 529-E and 529-F-1) can be used to save for college education. The retirement plan share classes (Classes R-1, R-2, R-3, R-4, R-5 and R-6) are generally offered only through eligible employer-sponsored retirement plans. The fund’s share classes are described below:
Share class | Initial sales charge | Contingent deferred sales charge upon redemption | Conversion feature |
Classes A and 529-A | Up to 5.75% | None (except 1% for certain redemptions within one year of purchase without an initial sales charge) | None |
Classes B and 529-B* | None | Declines from 5% to 0% for redemptions within six years of purchase | Classes B and 529-B convert to Classes A and 529-A, respectively, after eight years |
Class C | None | 1% for redemptions within one year of purchase | Class C converts to Class F-1 after 10 years |
Class 529-C | None | 1% for redemptions within one year of purchase | None |
Class 529-E | None | None | None |
Classes F-1, F-2 and 529-F-1 | None | None | None |
Classes R-1, R-2, R-3, R-4, R-5 and R-6 | None | None | None |
*Class B and 529-B shares of the fund are not available for purchase.
Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class.
2. | Significant accounting policies |
The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The fund follows the significant accounting policies described below, as well as the valuation policies described in the next section on valuation.
Security transactions and related investment income – Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.
Class allocations – Income, fees and expenses (other than class-specific fees and expenses) and realized and unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class.
Dividends and distributions to shareholders – Dividends and distributions paid to shareholders are recorded on the ex-dividend date.
Currency translation – Assets and liabilities, including investment securities, denominated in currencies other than U.S. dollars are translated into U.S. dollars at the exchange rates supplied by one or more pricing vendors on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. On the accompanying financial statements, the effects of changes in exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in currencies other than U.S. dollars are disclosed separately.
3. | Valuation |
Capital Research and Management Company (“CRMC”), the fund’s investment adviser, values the fund’s investments at fair value as defined by accounting principles generally accepted in the United States of America. The net asset value of each share class of the fund is generally determined as of approximately 4:00 p.m. New York time each day the New York Stock Exchange is open.
Methods and inputs – The fund’s investment adviser uses the following methods and inputs to establish the fair value of the fund’s assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.
Equity securities are generally valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market on which the security trades.
Fixed-income securities, including short-term securities purchased with more than 60 days left to maturity, are generally valued at prices obtained from one or more pricing vendors. Vendors value such securities based on one or more of the inputs described in the following table. The table provides examples of inputs that are commonly relevant for valuing particular classes of fixed-income securities in which the fund is authorized to invest. However, these classifications are not exclusive, and any of the inputs may be used to value any other class of fixed-income security.
Fixed-income class | Examples of standard inputs |
All | Benchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data (collectively referred to as “standard inputs”) |
Corporate bonds & notes; convertible securities | Standard inputs and underlying equity of the issuer |
Bonds & notes of governments & government agencies | Standard inputs and interest rate volatilities |
When the fund’s investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or not deemed to be representative), fixed-income securities will be valued in good faith at the mean quoted bid and asked prices that are reasonably and timely available (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type.
Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are generally valued in the manner described above for either equity or fixed-income securities, depending on which method is deemed most appropriate by the investment adviser. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates fair value. The value of short-term securities originally purchased with maturities greater than 60 days is determined based on an amortized value to par when they reach 60 days. Forward currency contracts are valued at the mean of representative quoted bid and asked prices, generally based on prices supplied by one or more pricing vendors.
Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the fund’s investment adviser are fair valued as determined in good faith under fair value guidelines adopted by authority of the fund’s board of trustees as further described on the following page. The investment adviser follows fair valuation guidelines, consistent with U.S. Securities and Exchange Commission (“SEC”) rules and guidance, to consider relevant principles and factors when making fair value determinations. The investment adviser considers relevant indications of value that are reasonably and timely available to it in determining the fair value to be assigned to a particular security, such as the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. In addition, the closing prices of equity securities that trade in markets outside U.S. time zones may be adjusted to reflect significant events that occur after the close of local trading but before the net asset value of each share class of the fund is determined. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.
Processes and structure– The fund’s board of trustees has delegated authority to the fund’s investment adviser to make fair value determinations, subject to board oversight. The investment adviser has established a Joint Fair Valuation Committee (the “Fair Valuation Committee”) to administer, implement and oversee the fair value process, and to make fair value decisions. The Fair Valuation Committee regularly reviews its own fair value decisions, as well as decisions made under its standing instructions to the investment adviser’s valuation teams. The Fair Valuation Committee reviews changes in fair value measurements from period to period and may, as deemed appropriate, update the fair valuation guidelines to better reflect the results of back testing and address new or evolving issues. The Fair Valuation Committee reports any changes to the fair valuation guidelines to the board of trustees with supplemental information to support the changes. The fund’s board and audit committee also regularly review reports that describe fair value determinations and methods.
The fund’s investment adviser has also established a Fixed-Income Pricing Review Group to administer and oversee the fixed-income valuation process, including the use of fixed-income pricing vendors. This group regularly reviews pricing vendor information and market data. Pricing decisions, processes and controls over security valuation are also subject to additional internal reviews, including an annual control self-evaluation program facilitated by the investment adviser’s compliance group.
Classifications – The fund’s investment adviser classifies the fund’s assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Certain securities trading outside the U.S. may transfer between Level 1 and Level 2 due to valuation adjustments resulting from significant market movements following the close of local trading. Level 3 values are based on significant unobservable inputs that reflect the investment adviser’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. The following tables present the fund’s valuation levels as of March 31, 2012 (dollars in thousands):
Investment securities: | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Common stocks: | ||||||||||||||||
Financials | $ | 17,131,807 | $ | - | $ | - | $ | 17,131,807 | ||||||||
Consumer discretionary | 12,774,009 | - | - | 12,774,009 | ||||||||||||
Consumer staples | 10,690,329 | 128,485 | - | 10,818,814 | ||||||||||||
Health care | 10,312,354 | - | - | 10,312,354 | ||||||||||||
Information technology | 10,290,902 | - | - | 10,290,902 | ||||||||||||
Industrials | 9,236,848 | - | - | 9,236,848 | ||||||||||||
Telecommunication services | 6,885,239 | - | - | 6,885,239 | ||||||||||||
Materials | 6,403,489 | 109,134 | - | 6,512,623 | ||||||||||||
Energy | 6,477,221 | - | - | 6,477,221 | ||||||||||||
Utilities | 1,990,988 | - | - | 1,990,988 | ||||||||||||
Miscellaneous | 1,575,691 | - | - | 1,575,691 | ||||||||||||
Bonds & notes | - | 100,092 | - | 100,092 | ||||||||||||
Short-term securities | - | 7,060,362 | - | 7,060,362 | ||||||||||||
Total | $ | 93,768,877 | $ | 7,398,073 | $ | - | $ | 101,166,950 | ||||||||
Forward currency contracts(*): | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Unrealized appreciation on open forward currency contracts | $ | - | $ | 5,113 | $ | - | $ | 5,113 | ||||||||
Unrealized depreciation on open forward currency contracts | - | (7,870 | ) | - | (7,870 | ) | ||||||||||
Total | $ | - | $ | (2,757 | ) | $ | - | $ | (2,757 | ) | ||||||
(*) Forward currency contracts are not included in the investment portfolio. |
4. | Risk factors |
Investing in the fund may involve certain risks including, but not limited to, those described below.
Market conditions — The prices of, and the income generated by, the common stocks and other securities held by the fund may decline due to market conditions and other factors, including those directly involving the issuers of securities held by the fund.
Investing in growth-oriented stocks — Growth-oriented stocks may involve larger price swings and greater potential for loss than other types of investments. These risks may be even greater in the case of smaller capitalization stocks.
Investing outside the U.S. — Securities of issuers domiciled outside the U. S., or with significant operations outside the U.S., may lose value because of political, social, economic or market developments or instability in the countries or regions in which the issuer operates. These securities may also lose value due to changes in foreign currency exchange rates against the U.S. dollar and/or currencies of other countries. Securities markets in certain countries may be more volatile and/or less liquid than those in the U.S. Investments outside the U.S. may also be subject to different settlement and accounting practices and different regulatory, legal and reporting standards, and may be more difficult to value, than those in the U.S. The risks of investing outside the U.S. may be heightened in connection with investments in emerging and developing countries.
Investing in emerging and developing countries — Investing in countries with developing economies and/or markets may involve risks in addition to and greater than those generally associated with investing in developed countries. For instance, emerging countries and developing countries may have less developed legal and accounting systems than those in developed countries. The governments of these countries may be less stable and more likely to impose capital controls, nationalize a company or industry, place restrictions on foreign ownership and on withdrawing sale proceeds of securities from the country, and/or impose punitive taxes that could adversely affect the prices of securities. In addition, the economies of these countries may be dependent on relatively few industries that are more susceptible to local and global changes. Securities markets in these countries can also be relatively small and have substantially lower trading volumes. As a result, securities issued in these countries may be more volatile and less liquid, and may be more difficult to value, than securities issued in countries with more developed economies and/or markets. Additionally, there may be increased settlement risks for transactions in local securities.
Management — The investment adviser to the fund actively manages the fund’s investments. Consequently, the fund is subject to the risk that the methods and analyses employed by the investment adviser in this process may not produce the desired results. This could cause the fund to lose value or its investment results to lag relevant benchmarks or other funds with similar objectives.
5. | Taxation and distributions |
Federal income taxation – The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made. Therefore, no federal income tax provision is required.
As of and during the period ended March 31, 2012, the fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, the fund did not incur any interest or penalties.
The fund is not subject to examination by U.S. federal tax authorities for tax years before 2008, by state tax authorities for tax years before 2007 and by tax authorities outside the U.S. for tax years before 2004.
Non-U.S. taxation – Dividend and interest income are recorded net of non-U.S. taxes paid. Gains realized by the fund on the sale of securities in certain countries are subject to non-U.S. taxes. The fund records a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.
Distributions – Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as currency gains and losses; short-term capital gains and losses; capital losses related to sales of certain securities within 30 days of purchase; unrealized appreciation of certain investments in securities outside the U.S.; cost of investments sold; and net capital losses. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes.
During the year ended March 31, 2012, the fund reclassified $89,164,000 from accumulated net realized loss to distributions in excess of net investment income and $130,000 from distributions in excess of net investment income to capital paid in on shares of beneficial interest to align financial reporting with tax reporting.
Under the Regulated Investment Company Modernization Act of 2010 (the “Act”), net capital losses recognized after March 31, 2011, may be carried forward indefinitely, and their character is retained as short-term and/or long-term losses. Previously, net capital losses were carried forward for eight years and treated as short-term losses. As a transition rule, the Act requires that post-enactment net capital losses be used before pre-enactment net capital losses.
As of March 31, 2012, the tax basis components of distributable earnings, unrealized appreciation (depreciation) and cost of investment securities were as follows:
(dollars in thousands) | ||||||||
Undistributed ordinary income | $ | 422,859 | ||||||
Capital loss carryforward*: | ||||||||
No expiration | $ | (1,783,203 | ) | |||||
Expiring 2017 | (3,126,924 | ) | ||||||
Expiring 2018 | (8,747,831 | ) | (13,657,958 | ) | ||||
Gross unrealized appreciation on investment securities | 26,181,596 | |||||||
Gross unrealized depreciation on investment securities | (2,980,537 | ) | ||||||
Net unrealized appreciation on investment securities | 23,201,059 | |||||||
Cost of investment securities | 77,965,891 | |||||||
*The capital loss carryforward will be used to offset any capital gains realized by the fund in future years through the expiration dates. The fund will not make distributions from capital gains while a capital loss carryforward remains. |
Tax-basis distributions paid to shareholders from ordinary income were as follows (dollars in thousands):
Year ended March 31 | ||||||||
Share class | 2012 | 2011 | ||||||
Class A | $ | 482,357 | $ | 538,555 | ||||
Class B | 2,919 | 4,373 | ||||||
Class C | 14,483 | 18,719 | ||||||
Class F-1 | 111,637 | 120,161 | ||||||
Class F-2 | 103,428 | 88,151 | ||||||
Class 529-A | 13,708 | 12,697 | ||||||
Class 529-B | 286 | 416 | ||||||
Class 529-C | 2,308 | 2,291 | ||||||
Class 529-E | 611 | 580 | ||||||
Class 529-F-1 | 1,097 | 1,031 | ||||||
Class R-1 | 2,303 | 2,414 | ||||||
Class R-2 | 8,165 | 9,285 | ||||||
Class R-3 | 87,246 | 84,818 | ||||||
Class R-4 | 189,806 | 177,635 | ||||||
Class R-5 | 257,982 | 267,158 | ||||||
Class R-6 | 295,345 | 197,337 | ||||||
Total | $ | 1,573,681 | $ | 1,525,621 |
6. | Fees and transactions with related parties |
CRMC, the fund’s investment adviser, is the parent company of American Funds Distributors,® Inc. ("AFD"), the principal underwriter of the fund’s shares, and American Funds Service Company® ("AFS"), the fund’s transfer agent.
Investment advisory services – The fund has an investment advisory and service agreement with CRMC that provides for monthly fees accrued daily. These fees are based on a series of decreasing annual rates beginning with 0.690% on the first $500 million of daily net assets and decreasing to 0.397% on such assets in excess of $115 billion. For the year ended March 31, 2012, the investment advisory services fee was $431,388,000, which was equivalent to an annualized rate of 0.424% of average daily net assets.
Class-specific fees and expenses – Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below:
Distribution services – The fund has plans of distribution for all share classes, except Classes F-2, R-5 and R-6. Under the plans, the board of trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, [ranging from 0.25% to 1.00% as noted below. In some cases, the board of trustees has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes with a plan may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD to provide certain shareholder services. The remaining amounts available to be paid under each plan are paid to dealers to compensate them for their sales activities.
For Classes A and 529-A, distribution-related expenses include the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.25% is not exceeded. As of March 31, 2012, there were no unreimbursed expenses subject to reimbursement for Classes A or 529-A.
Share class | Currently approved limits | Plan limits |
Class A | 0.25% | 0.25% |
Class 529-A | 0.25 | 0.50 |
Classes B and 529-B | 1.00 | 1.00 |
Classes C, 529-C and R-1 | 1.00 | 1.00 |
Class R-2 | 0.75 | 1.00 |
Classes 529-E and R-3 | 0.50 | 0.75 |
Classes F-1, 529-F-1 and R-4 | 0.25 | 0.50 |
Transfer agent services – The fund has a shareholder services agreement with AFS under which the fund compensates AFS for transfer agent services to each of the fund’s share classes. These services include recordkeeping, shareholder communications and transaction processing. In addition, the fund reimburses AFS for amounts paid to third parties for performing transfer agent services on behalf of fund shareholders.
During the period April 1, 2011, through December 31, 2011, only Class A and B shares were subject to the shareholder services agreement with AFS. During this period, AFS and other third parties were compensated for providing transfer agent services to Class C, F, R and 529 shares through the fees paid by the fund to CRMC under the fund’s administrative services agreement with CRMC as described in the administrative services section on the following page; CRMC paid for any transfer agent services expenses in excess of 0.10% of the respective average daily net assets of each of such share classes.
Effective January 1, 2012, the shareholder services agreement with AFS was modified to include Class C, F, R and 529 shares and payment for transfer agent services for such classes under the administrative services agreement terminated. Under this structure, transfer agent services expenses for some classes may exceed 0.10% of average daily net assets, resulting in an increase in expenses paid by some share classes.
For the year ended March 31, 2012, the total transfer agent services fee paid under these agreements was $102,703,000, of which $69,633,000 was paid by the fund to AFS and $33,070,000 was paid by the fund to CRMC through its administrative services agreement with the fund. Amounts paid to CRMC by the fund were then paid by CRMC to AFS and other third parties.
Administrative services – The fund has an administrative services agreement with CRMC under which the fund compensates CRMC for providing administrative services to Class A, C, F, R and 529 shares. These services include, but are not limited to, coordinating, monitoring, assisting and overseeing third parties that provide services to fund shareholders.
During the period April 1, 2011, through December 31, 2011, the agreement applied only to Class C, F, R and 529 shares. The agreement also required CRMC to arrange for the provision of transfer agent services for such share classes, which paid CRMC annual fees up to 0.15% (0.10% for Class R-5 and 0.05% for Class R-6) of their respective average daily net assets. During this period, up to 0.05% of these fees were used to compensate CRMC for performing administrative services; all other amounts paid under this agreement were used to compensate AFS and other third parties for transfer agent services.
Effective January 1, 2012, the administrative services agreement with CRMC was modified to include Class A shares. Under the revised agreement, Class A shares pay an annual fee of 0.01% and Class C, F, R and 529 shares pay an annual fee of 0.05% of their respective average daily net assets to CRMC for administrative services. Fees for transfer agent services are no longer included as part of the administrative services fee paid by the fund to CRMC.
For the year ended March 31, 2012, total fees paid to CRMC for performing administrative services were $34,122,000.
529 plan services – Each 529 share class is subject to service fees to compensate the Commonwealth of Virginia for the maintenance of the 529 college savings plan. The quarterly fee is based on a series of decreasing annual rates beginning with 0.10% on the first $30 billion of the net assets invested in Class 529 shares of the American Funds and decreasing to 0.06% on such assets between $120 billion and $150 billion. The fee for any given calendar quarter is accrued and calculated on the basis of the average net assets of Class 529 shares of the American Funds for the last month of the prior calendar quarter. The fee is included in other expenses on the accompanying financial statements. The Commonwealth of Virginia is not considered a related party.
Class-specific expenses under the agreements described above for the year ended March 31, 2012, were as follows (dollars in thousands):
Share class | Distribution services | Transfer agent services | Administrative services | 529 plan services | ||||||||||||
Class A | $ | 79,676 | $ | 50,391 | $ | 768 | Not applicable | |||||||||
Class B | 5,705 | 751 | Not applicable | Not applicable | ||||||||||||
Class C | 23,623 | 2,939 | 1,024 | Not applicable | ||||||||||||
Class F-1 | 19,234 | 8,588 | 3,711 | Not applicable | ||||||||||||
Class F-2 | Not applicable | 5,141 | 2,772 | Not applicable | ||||||||||||
Class 529-A | 1,884 | 743 | 418 | $ | 907 | |||||||||||
Class 529-B | 620 | 65 | 29 | 62 | ||||||||||||
Class 529-C | 3,204 | 305 | 148 | 322 | ||||||||||||
Class 529-E | 249 | 34 | 24 | 50 | ||||||||||||
Class 529-F-1 | - | 53 | 30 | 65 | ||||||||||||
Class R-1 | 2,977 | 339 | 148 | Not applicable | ||||||||||||
Class R-2 | 8,670 | 4,278 | 576 | Not applicable | ||||||||||||
Class R-3 | 35,088 | 9,597 | 3,544 | Not applicable | ||||||||||||
Class R-4 | 31,043 | 12,558 | 6,176 | Not applicable | ||||||||||||
Class R-5 | Not applicable | 6,875 | 7,331 | Not applicable | ||||||||||||
Class R-6 | Not applicable | 46 | 7,423 | Not applicable | ||||||||||||
Total class-specific expenses | $ | 211,973 | $ | 102,703 | $ | 34,122 | $ | 1,406 |
Trustees’ deferred compensation – Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Trustees’ compensation of $318,000, shown on the accompanying financial statements, includes $432,000 in current fees (either paid in cash or deferred) and a net decrease of $114,000 in the value of the deferred amounts.
Affiliated officers and trustees – Officers and certain trustees of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or trustees received any compensation directly from the fund.
7. | Capital share transactions |
Capital share transactions in the fund were as follows (dollars and shares in thousands):
Sales(*) | Reinvestments of dividends | Repurchases(*) | Net (decrease) increase | |||||||||||||||||||||||||||||
Share class | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | ||||||||||||||||||||||||
Year ended March 31, 2012 | ||||||||||||||||||||||||||||||||
Class A | $ | 2,977,675 | 76,413 | $ | 467,362 | 13,292 | $ | (8,334,408 | ) | (213,809 | ) | $ | (4,889,371 | ) | (124,104 | ) | ||||||||||||||||
Class B | 9,334 | 237 | 2,869 | 82 | (228,983 | ) | (5,968 | ) | (216,780 | ) | (5,649 | ) | ||||||||||||||||||||
Class C | 151,841 | 3,934 | 13,945 | 405 | (671,747 | ) | (17,870 | ) | (505,961 | ) | (13,531 | ) | ||||||||||||||||||||
Class F-1 | 1,734,322 | 44,909 | 109,727 | 3,137 | (2,587,948 | ) | (67,851 | ) | (743,899 | ) | (19,805 | ) | ||||||||||||||||||||
Class F-2 | 1,927,103 | 48,796 | 85,272 | 2,429 | (1,724,212 | ) | (45,394 | ) | 288,163 | 5,831 | ||||||||||||||||||||||
Class 529-A | 125,628 | 3,251 | 13,702 | 394 | (117,430 | ) | (3,073 | ) | 21,900 | 572 | ||||||||||||||||||||||
Class 529-B | 1,223 | 31 | 286 | 9 | (21,546 | ) | (572 | ) | (20,037 | ) | (532 | ) | ||||||||||||||||||||
Class 529-C | 40,189 | 1,062 | 2,307 | 67 | (49,915 | ) | (1,335 | ) | (7,419 | ) | (206 | ) | ||||||||||||||||||||
Class 529-E | 7,062 | 184 | 611 | 18 | (8,008 | ) | (213 | ) | (335 | ) | (11 | ) | ||||||||||||||||||||
Class 529-F-1 | 13,713 | 353 | 1,096 | 31 | (14,615 | ) | (384 | ) | 194 | - | ||||||||||||||||||||||
Class R-1 | 66,257 | 1,773 | 2,293 | 67 | (73,592 | ) | (1,963 | ) | (5,042 | ) | (123 | ) | ||||||||||||||||||||
Class R-2 | 279,234 | 7,370 | 8,153 | 238 | (435,387 | ) | (11,523 | ) | (148,000 | ) | (3,915 | ) | ||||||||||||||||||||
Class R-3 | 1,574,671 | 41,305 | 87,185 | 2,525 | (1,944,965 | ) | (50,998 | ) | (283,109 | ) | (7,168 | ) | ||||||||||||||||||||
Class R-4 | 3,235,634 | 84,584 | 189,768 | 5,493 | (3,646,406 | ) | (95,339 | ) | (221,004 | ) | (5,262 | ) | ||||||||||||||||||||
Class R-5 | 3,499,102 | 90,179 | 256,756 | 7,317 | (4,976,672 | ) | (129,345 | ) | (1,220,814 | ) | (31,849 | ) | ||||||||||||||||||||
Class R-6 | 7,178,141 | 184,536 | 294,338 | 8,378 | (2,666,159 | ) | (68,771 | ) | 4,806,320 | 124,143 | ||||||||||||||||||||||
Total net increase | ||||||||||||||||||||||||||||||||
(decrease) | $ | 22,821,129 | 588,917 | $ | 1,535,670 | 43,882 | $ | (27,501,993 | ) | (714,408 | ) | $ | (3,145,194 | ) | (81,609 | ) | ||||||||||||||||
Year ended March 31, 2011 | ||||||||||||||||||||||||||||||||
Class A | $ | 4,005,760 | 101,815 | $ | 515,723 | 12,591 | $ | (9,353,275 | ) | (240,458 | ) | $ | (4,831,792 | ) | (126,052 | ) | ||||||||||||||||
Class B | 18,399 | 474 | 4,257 | 105 | (277,341 | ) | (7,251 | ) | (254,685 | ) | (6,672 | ) | ||||||||||||||||||||
Class C | 282,731 | 7,409 | 17,831 | 445 | (623,657 | ) | (16,547 | ) | (323,095 | ) | (8,693 | ) | ||||||||||||||||||||
Class F-1 | 2,440,819 | 63,452 | 109,283 | 2,682 | (3,157,395 | ) | (81,743 | ) | (607,293 | ) | (15,609 | ) | ||||||||||||||||||||
Class F-2 | 2,585,449 | 65,531 | 58,528 | 1,430 | (1,018,855 | ) | (26,020 | ) | 1,625,122 | 40,941 | ||||||||||||||||||||||
Class 529-A | 141,835 | 3,629 | 12,693 | 312 | (90,645 | ) | (2,347 | ) | 63,883 | 1,594 | ||||||||||||||||||||||
Class 529-B | 2,040 | 53 | 415 | 10 | (22,876 | ) | (603 | ) | (20,421 | ) | (540 | ) | ||||||||||||||||||||
Class 529-C | 50,481 | 1,318 | 2,290 | 58 | (42,195 | ) | (1,123 | ) | 10,576 | 253 | ||||||||||||||||||||||
Class 529-E | 7,843 | 202 | 580 | 14 | (5,079 | ) | (132 | ) | 3,344 | 84 | ||||||||||||||||||||||
Class 529-F-1 | 15,949 | 405 | 1,031 | 26 | (9,107 | ) | (232 | ) | 7,873 | 199 | ||||||||||||||||||||||
Class R-1 | 89,610 | 2,384 | 2,399 | 60 | (71,226 | ) | (1,922 | ) | 20,783 | 522 | ||||||||||||||||||||||
Class R-2 | 349,781 | 9,185 | 9,275 | 233 | (437,886 | ) | (11,578 | ) | (78,830 | ) | (2,160 | ) | ||||||||||||||||||||
Class R-3 | 2,006,663 | 52,221 | 84,751 | 2,106 | (2,144,430 | ) | (56,436 | ) | (53,016 | ) | (2,109 | ) | ||||||||||||||||||||
Class R-4 | 4,113,590 | 106,364 | 177,506 | 4,407 | (3,002,724 | ) | (78,378 | ) | 1,288,372 | 32,393 | ||||||||||||||||||||||
Class R-5 | 3,883,229 | 99,542 | 266,087 | 6,504 | (5,872,150 | ) | (151,830 | ) | (1,722,834 | ) | (45,784 | ) | ||||||||||||||||||||
Class R-6 | 6,296,062 | 160,431 | 196,630 | 4,801 | (1,606,205 | ) | (40,991 | ) | 4,886,487 | 124,241 | ||||||||||||||||||||||
Total net increase | ||||||||||||||||||||||||||||||||
(decrease) | $ | 26,290,241 | 674,415 | $ | 1,459,279 | 35,784 | $ | (27,735,046 | ) | (717,591 | ) | $ | 14,474 | (7,392 | ) | |||||||||||||||||
* Includes exchanges between share classes of the fund. |
8. | Investment transactions |
The fund made purchases and sales of investment securities, excluding short-term securities and U.S. government obligations, if any, of $23,110,965,000 and $25,644,855,000, respectively, during the year ended March 31, 2012.
9. | Forward currency contracts |
The fund has entered into forward currency contracts, which represent agreements to exchange currencies on specific future dates at predetermined rates. The fund’s investment adviser uses forward currency contracts to manage the fund’s exposure to changes in exchange rates. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from possible movements in exchange rates.
On a daily basis, the fund’s investment adviser values forward currency contracts based on the applicable exchange rate and records unrealized appreciation or depreciation for open forward currency contracts in the fund’s statement of assets and liabilities. Realized gains or losses are recorded at the time the forward currency contract is closed or offset by another contract with the same broker for the same settlement date and currency. Closed forward currency contracts that have not reached their settlement date are included in the respective receivables or payables for closed forward currency contracts in the fund’s statement of assets and liabilities. Net realized gains or losses from closed forward currency contracts and net unrealized appreciation or depreciation from open forward currency contracts are recorded in the fund’s statement of operations.
As of March 31, 2012, the fund had open forward currency contracts to sell currencies, as shown in the following table. The open forward currency contracts shown are generally indicative of the level of activity over the prior 12-month period.
(amounts in thousands) | ||||||||||||||||||||
Contract amount | Unrealized appreciation (depreciation) at 3/31/2012 | |||||||||||||||||||
Settlement date | Counterparty | Receive | Deliver | |||||||||||||||||
Sales: | ||||||||||||||||||||
Australian dollars | 4/4/2012 | UBS AG | $ | 120,064 | $ | A | 112,000 | 4,116 | ||||||||||||
Euros | 4/5/2012 | HSBC Bank | $ | 227,710 | € | 170,000 | 975 | |||||||||||||
Euros | 4/11/2012 | UBS AG | $ | 39,448 | € | 29,560 | 22 | |||||||||||||
Euros | 4/19/2012 | JPMorgan Chase | $ | 85,428 | € | 65,000 | (1,270 | ) | ||||||||||||
Euros | 4/20/2012 | JPMorgan Chase | $ | 102,590 | € | 78,000 | (1,448 | ) | ||||||||||||
Euros | 4/26/2012 | Citibank | $ | 73,650 | € | 55,900 | (912 | ) | ||||||||||||
Euros | 4/26/2012 | UBS AG | $ | 231,827 | € | 175,000 | (1,598 | ) | ||||||||||||
Euros | 4/27/2012 | JPMorgan Chase | $ | 231,565 | € | 175,000 | (1,860 | ) | ||||||||||||
Euros | 4/30/2012 | Citibank | $ | 232,774 | € | 175,000 | (654 | ) | ||||||||||||
Euros | 4/30/2012 | Barclays Bank PLC | $ | 97,564 | € | 73,183 | (53 | ) | ||||||||||||
Euros | 5/9/2012 | JPMorgan Chase | $ | 99,990 | € | 75,000 | (56 | ) | ||||||||||||
Euros | 5/10/2012 | UBS AG | $ | 101,121 | € | 75,819 | (19 | ) | ||||||||||||
(2,757 | ) |
Financial highlights
(Loss) income from investment operations(1) | Dividends and distributions | |||||||||||||||||||||||||||||||||||||||||||||||||||
Net asset value, beginning of period | Net investment income | Net (losses) gains on securities (both realized and unrealized) | Total from investment operations | Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return(2)(3) | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimbursements/ waivers | Ratio of expenses to average net assets after reimbursements/ waivers(3) | Ratio of net income to average net assets(3) | ||||||||||||||||||||||||||||||||||||||||
Class A: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | $ | 42.81 | $ | .65 | $ | (3.40 | ) | $ | (2.75 | ) | $ | (.59 | ) | $ | - | $ | (.59 | ) | $ | 39.47 | (6.25 | )% | $ | 31,443 | .84 | % | .84 | % | 1.65 | % | ||||||||||||||||||||||
Year ended 3/31/2011 | 38.62 | .54 | 4.22 | 4.76 | (.57 | ) | - | (.57 | ) | 42.81 | 12.39 | 39,417 | .82 | .82 | 1.39 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.78 | .51 | 12.95 | 13.46 | (.62 | ) | - | (.62 | ) | 38.62 | 52.23 | 40,426 | .85 | .85 | 1.45 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.83 | .88 | (19.76 | ) | (18.88 | ) | (.78 | ) | (1.39 | ) | (2.17 | ) | 25.78 | (40.54 | ) | 28,192 | .83 | .80 | 2.40 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.92 | .95 | 2.60 | 3.55 | (1.01 | ) | (3.63 | ) | (4.64 | ) | 46.83 | 6.40 | 57,445 | .79 | .74 | 1.87 | ||||||||||||||||||||||||||||||||||||
Class B: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.39 | .37 | (3.34 | ) | (2.97 | ) | (.22 | ) | - | (.22 | ) | 39.20 | (6.95 | ) | 464 | 1.58 | 1.58 | .96 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.21 | .26 | 4.15 | 4.41 | (.23 | ) | - | (.23 | ) | 42.39 | 11.57 | 741 | 1.57 | 1.57 | .69 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.52 | .26 | 12.79 | 13.05 | (.36 | ) | - | (.36 | ) | 38.21 | 51.12 | 923 | 1.59 | 1.59 | .77 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.14 | .62 | (19.44 | ) | (18.82 | ) | (.41 | ) | (1.39 | ) | (1.80 | ) | 25.52 | (40.98 | ) | 765 | 1.57 | 1.54 | 1.70 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.31 | .56 | 2.54 | 3.10 | (.64 | ) | (3.63 | ) | (4.27 | ) | 46.14 | 5.60 | 1,775 | 1.52 | 1.48 | 1.12 | ||||||||||||||||||||||||||||||||||||
Class C: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 41.76 | .34 | (3.28 | ) | (2.94 | ) | (.25 | ) | - | (.25 | ) | 38.57 | (6.97 | ) | 2,111 | 1.62 | 1.62 | .89 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.70 | .23 | 4.10 | 4.33 | (.27 | ) | - | (.27 | ) | 41.76 | 11.51 | 2,851 | 1.61 | 1.61 | .60 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.21 | .22 | 12.65 | 12.87 | (.38 | ) | - | (.38 | ) | 37.70 | 51.06 | 2,901 | 1.63 | 1.63 | .66 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 45.64 | .58 | (19.20 | ) | (18.62 | ) | (.42 | ) | (1.39 | ) | (1.81 | ) | 25.21 | (41.00 | ) | 1,927 | 1.62 | 1.58 | 1.63 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 46.85 | .53 | 2.53 | 3.06 | (.64 | ) | (3.63 | ) | (4.27 | ) | 45.64 | 5.57 | 4,093 | 1.57 | 1.53 | 1.06 | ||||||||||||||||||||||||||||||||||||
Class F-1: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.59 | .63 | (3.37 | ) | (2.74 | ) | (.58 | ) | - | (.58 | ) | 39.27 | (6.25 | ) | 7,399 | .86 | .86 | 1.62 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.43 | .52 | 4.20 | 4.72 | (.56 | ) | - | (.56 | ) | 42.59 | 12.36 | 8,868 | .85 | .85 | 1.35 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.66 | .49 | 12.91 | 13.40 | (.63 | ) | - | (.63 | ) | 38.43 | 52.24 | 8,601 | .86 | .86 | 1.39 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.62 | .87 | (19.68 | ) | (18.81 | ) | (.76 | ) | (1.39 | ) | (2.15 | ) | 25.66 | (40.55 | ) | 5,097 | .84 | .81 | 2.38 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.73 | .92 | 2.60 | 3.52 | (1.00 | ) | (3.63 | ) | (4.63 | ) | 46.62 | 6.38 | 10,328 | .81 | .77 | 1.81 | ||||||||||||||||||||||||||||||||||||
Class F-2: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.80 | .73 | (3.39 | ) | (2.66 | ) | (.70 | ) | - | (.70 | ) | 39.44 | (6.02 | ) | 5,958 | .58 | .58 | 1.86 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.62 | .61 | 4.25 | 4.86 | (.68 | ) | - | (.68 | ) | 42.80 | 12.65 | 6,216 | .59 | .59 | 1.54 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.78 | .47 | 13.10 | 13.57 | (.73 | ) | - | (.73 | ) | 38.62 | 52.65 | 4,028 | .60 | .60 | 1.31 | |||||||||||||||||||||||||||||||||||||
Period from 8/1/2008 to 3/31/2009(4) | 43.75 | .29 | (16.05 | ) | (15.76 | ) | (.82 | ) | (1.39 | ) | (2.21 | ) | 25.78 | (36.26 | ) | 806 | .63 | (5) | .61 | (5) | 1.59 | (5) | ||||||||||||||||||||||||||||||
Class 529-A: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.45 | .61 | (3.35 | ) | (2.74 | ) | (.59 | ) | - | (.59 | ) | 39.12 | (6.30 | ) | 928 | .89 | .89 | 1.56 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.31 | .51 | 4.20 | 4.71 | (.57 | ) | - | (.57 | ) | 42.45 | 12.36 | 982 | .87 | .87 | 1.31 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.59 | .48 | 12.86 | 13.34 | (.62 | ) | - | (.62 | ) | 38.31 | 52.14 | 826 | .89 | .89 | 1.37 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.53 | .82 | (19.59 | ) | (18.77 | ) | (.78 | ) | (1.39 | ) | (2.17 | ) | 25.59 | (40.54 | ) | 497 | .87 | .83 | 2.30 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.66 | .90 | 2.60 | 3.50 | (1.00 | ) | (3.63 | ) | (4.63 | ) | 46.53 | 6.34 | 789 | .83 | .79 | 1.78 | ||||||||||||||||||||||||||||||||||||
Class 529-B: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 41.77 | .32 | (3.29 | ) | (2.97 | ) | (.19 | ) | - | (.19 | ) | 38.61 | (7.05 | ) | 52 | 1.70 | 1.70 | .83 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.68 | .21 | 4.09 | 4.30 | (.21 | ) | - | (.21 | ) | 41.77 | 11.43 | 79 | 1.68 | 1.68 | .56 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.20 | .20 | 12.63 | 12.83 | (.35 | ) | - | (.35 | ) | 37.68 | 50.94 | 91 | 1.71 | 1.71 | .59 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 45.71 | .53 | (19.20 | ) | (18.67 | ) | (.45 | ) | (1.39 | ) | (1.84 | ) | 25.20 | (41.03 | ) | 63 | 1.69 | 1.65 | 1.49 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 46.93 | .48 | 2.53 | 3.01 | (.60 | ) | (3.63 | ) | (4.23 | ) | 45.71 | 5.47 | 107 | 1.66 | 1.61 | .97 | ||||||||||||||||||||||||||||||||||||
Class 529-C: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 41.60 | .29 | (3.26 | ) | (2.97 | ) | (.27 | ) | - | (.27 | ) | 38.36 | (7.05 | ) | 321 | 1.68 | 1.68 | .77 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.58 | .20 | 4.09 | 4.29 | (.27 | ) | - | (.27 | ) | 41.60 | 11.46 | 356 | 1.67 | 1.67 | .52 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.14 | .20 | 12.62 | 12.82 | (.38 | ) | - | (.38 | ) | 37.58 | 50.98 | 313 | 1.70 | 1.70 | .57 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 45.63 | .53 | (19.17 | ) | (18.64 | ) | (.46 | ) | (1.39 | ) | (1.85 | ) | 25.14 | (41.05 | ) | 191 | 1.68 | 1.65 | 1.49 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 46.87 | .48 | 2.53 | 3.01 | (.62 | ) | (3.63 | ) | (4.25 | ) | 45.63 | 5.47 | 317 | 1.65 | 1.61 | .96 | ||||||||||||||||||||||||||||||||||||
Class 529-E: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.11 | .50 | (3.32 | ) | (2.82 | ) | (.47 | ) | - | (.47 | ) | 38.82 | (6.58 | ) | 50 | 1.16 | 1.16 | 1.29 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.02 | .39 | 4.16 | 4.55 | (.46 | ) | - | (.46 | ) | 42.11 | 12.03 | 55 | 1.16 | 1.16 | 1.02 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.41 | .37 | 12.77 | 13.14 | (.53 | ) | - | (.53 | ) | 38.02 | 51.73 | 46 | 1.19 | 1.19 | 1.08 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.17 | .71 | (19.42 | ) | (18.71 | ) | (.66 | ) | (1.39 | ) | (2.05 | ) | 25.41 | (40.73 | ) | 28 | 1.17 | 1.14 | 2.00 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.34 | .74 | 2.57 | 3.31 | (.85 | ) | (3.63 | ) | (4.48 | ) | 46.17 | 6.00 | 45 | 1.14 | 1.10 | 1.47 | ||||||||||||||||||||||||||||||||||||
Class 529-F-1: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | $ | 42.45 | $ | .69 | $ | (3.36 | ) | $ | (2.67 | ) | $ | (.67 | ) | $ | - | $ | (.67 | ) | $ | 39.11 | (6.09 | )% | $ | 65 | .68 | % | .68 | % | 1.78 | % | ||||||||||||||||||||||
Year ended 3/31/2011 | 38.30 | .58 | 4.22 | 4.80 | (.65 | ) | - | (.65 | ) | 42.45 | 12.58 | 71 | .66 | .66 | 1.50 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.57 | .55 | 12.86 | 13.41 | (.68 | ) | - | (.68 | ) | 38.30 | 52.47 | 56 | .69 | .69 | 1.58 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.54 | .88 | (19.60 | ) | (18.72 | ) | (.86 | ) | (1.39 | ) | (2.25 | ) | 25.57 | (40.44 | ) | 33 | .67 | .64 | 2.48 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.65 | .99 | 2.62 | 3.61 | (1.09 | ) | (3.63 | ) | (4.72 | ) | 46.54 | 6.55 | 51 | .64 | .60 | 1.96 | ||||||||||||||||||||||||||||||||||||
Class R-1: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 41.34 | .32 | (3.24 | ) | (2.92 | ) | (.30 | ) | - | (.30 | ) | 38.12 | (6.98 | ) | 300 | 1.61 | 1.61 | .85 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.36 | .21 | 4.08 | 4.29 | (.31 | ) | - | (.31 | ) | 41.34 | 11.52 | 330 | 1.62 | 1.62 | .57 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.01 | .20 | 12.57 | 12.77 | (.42 | ) | - | (.42 | ) | 37.36 | 51.08 | 279 | 1.64 | 1.64 | .59 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 45.45 | .54 | (19.09 | ) | (18.55 | ) | (.50 | ) | (1.39 | ) | (1.89 | ) | 25.01 | (41.01 | ) | 143 | 1.61 | 1.57 | 1.55 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 46.71 | .49 | 2.54 | 3.03 | (.66 | ) | (3.63 | ) | (4.29 | ) | 45.45 | 5.52 | 190 | 1.61 | 1.57 | .99 | ||||||||||||||||||||||||||||||||||||
Class R-2: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 41.60 | .33 | (3.26 | ) | (2.93 | ) | (.28 | ) | - | (.28 | ) | 38.39 | (7.00 | ) | 1,098 | 1.62 | 1.62 | .87 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.56 | .23 | 4.09 | 4.32 | (.28 | ) | - | (.28 | ) | 41.60 | 11.54 | 1,353 | 1.61 | 1.61 | .60 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.13 | .20 | 12.62 | 12.82 | (.39 | ) | - | (.39 | ) | 37.56 | 51.02 | 1,303 | 1.66 | 1.66 | .60 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 45.62 | .53 | (19.17 | ) | (18.64 | ) | (.46 | ) | (1.39 | ) | (1.85 | ) | 25.13 | (41.05 | ) | 784 | 1.68 | 1.64 | 1.51 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 46.84 | .50 | 2.54 | 3.04 | (.63 | ) | (3.63 | ) | (4.26 | ) | 45.62 | 5.51 | 1,296 | 1.61 | 1.57 | 1.01 | ||||||||||||||||||||||||||||||||||||
Class R-3: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.01 | .51 | (3.31 | ) | (2.80 | ) | (.48 | ) | - | (.48 | ) | 38.73 | (6.52 | ) | 6,922 | 1.14 | 1.14 | 1.32 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 37.93 | .41 | 4.13 | 4.54 | (.46 | ) | - | (.46 | ) | 42.01 | 12.03 | 7,810 | 1.13 | 1.13 | 1.06 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.35 | .38 | 12.75 | 13.13 | (.55 | ) | - | (.55 | ) | 37.93 | 51.80 | 7,131 | 1.15 | 1.15 | 1.10 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.04 | .77 | (19.41 | ) | (18.64 | ) | (.66 | ) | (1.39 | ) | (2.05 | ) | 25.35 | (40.70 | ) | 4,139 | 1.11 | 1.08 | 2.14 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.20 | .78 | 2.54 | 3.32 | (.85 | ) | (3.63 | ) | (4.48 | ) | 46.04 | 6.05 | 7,639 | 1.11 | 1.07 | 1.55 | ||||||||||||||||||||||||||||||||||||
Class R-4: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.09 | .62 | (3.33 | ) | (2.71 | ) | (.59 | ) | - | (.59 | ) | 38.79 | (6.25 | ) | 12,490 | .85 | .85 | 1.61 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.00 | .51 | 4.16 | 4.67 | (.58 | ) | - | (.58 | ) | 42.09 | 12.35 | 13,775 | .85 | .85 | 1.32 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.37 | .50 | 12.76 | 13.26 | (.63 | ) | - | (.63 | ) | 38.00 | 52.21 | 11,204 | .86 | .86 | 1.43 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.17 | .81 | (19.43 | ) | (18.62 | ) | (.79 | ) | (1.39 | ) | (2.18 | ) | 25.37 | (40.53 | ) | 7,290 | .85 | .82 | 2.29 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.31 | .88 | 2.60 | 3.48 | (.99 | ) | (3.63 | ) | (4.62 | ) | 46.17 | 6.32 | 10,970 | .85 | .81 | 1.75 | ||||||||||||||||||||||||||||||||||||
Class R-5: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.78 | .76 | (3.40 | ) | (2.64 | ) | (.71 | ) | - | (.71 | ) | 39.43 | (5.99 | ) | 14,016 | .55 | .55 | 1.93 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.59 | .65 | 4.22 | 4.87 | (.68 | ) | - | (.68 | ) | 42.78 | 12.70 | 16,572 | .55 | .55 | 1.65 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2010 | 25.75 | .63 | 12.93 | 13.56 | (.72 | ) | - | (.72 | ) | 38.59 | 52.70 | 16,716 | .56 | .56 | 1.80 | |||||||||||||||||||||||||||||||||||||
Year ended 3/31/2009 | 46.86 | .93 | (19.74 | ) | (18.81 | ) | (.91 | ) | (1.39 | ) | (2.30 | ) | 25.75 | (40.37 | ) | 13,529 | .54 | .51 | 2.60 | |||||||||||||||||||||||||||||||||
Year ended 3/31/2008 | 47.94 | 1.05 | 2.63 | 3.68 | (1.13 | ) | (3.63 | ) | (4.76 | ) | 46.86 | 6.64 | 19,731 | .55 | .50 | 2.05 | ||||||||||||||||||||||||||||||||||||
Class R-6: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended 3/31/2012 | 42.85 | .73 | (3.36 | ) | (2.63 | ) | (.74 | ) | - | (.74 | ) | 39.48 | (5.94 | ) | 17,603 | .50 | .50 | 1.88 | ||||||||||||||||||||||||||||||||||
Year ended 3/31/2011 | 38.65 | .63 | 4.28 | 4.91 | (.71 | ) | - | (.71 | ) | 42.85 | 12.78 | 13,786 | .50 | .50 | 1.61 | |||||||||||||||||||||||||||||||||||||
Period from 5/1/2009 to 3/31/2010(4) | 28.64 | .42 | 10.30 | 10.72 | (.71 | ) | - | (.71 | ) | 38.65 | 37.43 | 7,635 | .52 | (5) | .52 | (5) | 1.26 | (5) |
Year ended March 31 | ||||||||||||||||||||
2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||
Portfolio turnover rate for all share classes | 24 | % | 31 | % | 26 | % | 41 | % | 38 | % |
(1)Based on average shares outstanding. | |||||||||||||
(2)Total returns exclude any applicable sales charges, including contingent deferred sales charges. | |||||||||||||
(3)This column reflects the impact, if any, of certain reimbursements/waivers from CRMC. During some of the periods shown, CRMC reduced fees for investment advisory services. In addition, during some of the periods shown, CRMC paid a portion of the fund's transfer agent fees for certain retirement plan share classes. | |||||||||||||
(4)Based on operations for the period shown and, accordingly, is not representative of a full year. | |||||||||||||
(5)Annualized. | |||||||||||||
See Notes to Financial Statements |
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees of EuroPacific Growth Fund:
We have audited the accompanying statement of assets and liabilities of EuroPacific Growth Fund (the “Fund”), including the summary investment portfolio, as of March 31, 2012, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of March 31, 2012, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of EuroPacific Growth Fund as of March 31, 2012, 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 then ended, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.
Deloitte & Touche LLP
Costa Mesa, California
May 9, 2012
Expense example
unaudited
As a shareholder of the fund, you incur two types of costs: (1) transaction costs, such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads), and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period (October 1, 2011, through March 31, 2012).
Actual expenses:
The first line of each share class in the table on the next page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses paid during period" to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes:
The second line of each share class in the table on the next page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.
Notes:
There are some account fees that are charged to certain types of accounts, such as individual retirement accounts and 529 college savings plan accounts (generally, a $10 fee is charged to set up the account and an additional $10 fee is charged to the account annually), that would increase the amount of expenses paid on your account. In addition, retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F-1, F-2 and 529-F-1 shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would be lower by the amount of these fees.
Note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Beginning account value 10/1/2011 | Ending account value 3/31/2012 | Expenses paid during period* | Annualized expense ratio | |||||||||||||
Class A -- actual return | $ | 1,000.00 | $ | 1,173.48 | $ | 4.67 | .86 | % | ||||||||
Class A -- assumed 5% return | 1,000.00 | 1,020.70 | 4.34 | .86 | ||||||||||||
Class B -- actual return | 1,000.00 | 1,169.10 | 8.68 | 1.60 | ||||||||||||
Class B -- assumed 5% return | 1,000.00 | 1,017.00 | 8.07 | 1.60 | ||||||||||||
Class C -- actual return | 1,000.00 | 1,169.10 | 8.78 | 1.62 | ||||||||||||
Class C -- assumed 5% return | 1,000.00 | 1,016.90 | 8.17 | 1.62 | ||||||||||||
Class F-1 -- actual return | 1,000.00 | 1,173.54 | 4.67 | .86 | ||||||||||||
Class F-1 -- assumed 5% return | 1,000.00 | 1,020.70 | 4.34 | .86 | ||||||||||||
Class F-2 -- actual return | 1,000.00 | 1,175.15 | 3.21 | .59 | ||||||||||||
Class F-2 -- assumed 5% return | 1,000.00 | 1,022.05 | 2.98 | .59 | ||||||||||||
Class 529-A -- actual return | 1,000.00 | 1,173.40 | 4.84 | .89 | ||||||||||||
Class 529-A -- assumed 5% return | 1,000.00 | 1,020.55 | 4.50 | .89 | ||||||||||||
Class 529-B -- actual return | 1,000.00 | 1,168.34 | 9.27 | 1.71 | ||||||||||||
Class 529-B -- assumed 5% return | 1,000.00 | 1,016.45 | 8.62 | 1.71 | ||||||||||||
Class 529-C -- actual return | 1,000.00 | 1,168.56 | 9.16 | 1.69 | ||||||||||||
Class 529-C -- assumed 5% return | 1,000.00 | 1,016.55 | 8.52 | 1.69 | ||||||||||||
Class 529-E -- actual return | 1,000.00 | 1,171.60 | 6.35 | 1.17 | ||||||||||||
Class 529-E -- assumed 5% return | 1,000.00 | 1,019.15 | 5.91 | 1.17 | ||||||||||||
Class 529-F-1 -- actual return | 1,000.00 | 1,174.36 | 3.75 | .69 | ||||||||||||
Class 529-F-1 -- assumed 5% return | 1,000.00 | 1,021.55 | 3.49 | .69 | ||||||||||||
Class R-1 -- actual return | 1,000.00 | 1,169.14 | 8.79 | 1.62 | ||||||||||||
Class R-1 -- assumed 5% return | 1,000.00 | 1,016.90 | 8.17 | 1.62 | ||||||||||||
Class R-2 -- actual return | 1,000.00 | 1,168.86 | 8.78 | 1.62 | ||||||||||||
Class R-2 -- assumed 5% return | 1,000.00 | 1,016.90 | 8.17 | 1.62 | ||||||||||||
Class R-3 -- actual return | 1,000.00 | 1,171.89 | 6.14 | 1.13 | ||||||||||||
Class R-3 -- assumed 5% return | 1,000.00 | 1,019.35 | 5.70 | 1.13 | ||||||||||||
Class R-4 -- actual return | 1,000.00 | 1,173.63 | 4.62 | .85 | ||||||||||||
Class R-4 -- assumed 5% return | 1,000.00 | 1,020.75 | 4.29 | .85 | ||||||||||||
Class R-5 -- actual return | 1,000.00 | 1,174.99 | 2.99 | .55 | ||||||||||||
Class R-5 -- assumed 5% return | 1,000.00 | 1,022.25 | 2.78 | .55 | ||||||||||||
Class R-6 -- actual return | 1,000.00 | 1,175.44 | 2.72 | .50 | ||||||||||||
Class R-6 -- assumed 5% return | 1,000.00 | 1,022.50 | 2.53 | .50 | ||||||||||||
*The “expenses paid during period” are equal to the “annualized expense ratio,” multiplied by the average account value over the period, multiplied by the number of days in the period, and divided by 366 (to reflect the one-half year period). |
Tax information
unaudited
We are required to advise you of the federal tax status of certain distributions received by shareholders during the fiscal year. The fund hereby designates the following amounts for the fund’s fiscal year ended March 31, 2012:
Foreign taxes | $0.11 per share | |||
Foreign source income | $1.08 per share | |||
Qualified dividend income | 100 | % | ||
U.S. government income that may be exempt from state taxation | $ | 2,665,000 |
Individual shareholders should refer to their Form 1099 or other tax information, which will be mailed in January 2013, to determine the calendar year amounts to be included on their 2012 tax returns. Shareholders should consult their tax advisers.
Approval of Investment Advisory and Service Agreement
The fund’s board has approved the fund’s Investment Advisory and Service Agreement (the “agreement”) with Capital Research and Management Company (“CRMC”) for an additional one-year term through December 31, 2012. The board approved the agreement following the recommendation of the fund’s Contracts Committee (the “committee”), which is composed of all of the fund’s independent board members. The board and the committee determined that the fund’s advisory fee structure was fair and reasonable in relation to the services provided and that approving the agreement was in the best interests of the fund and its shareholders.
In reaching this decision, the board and the committee took into account information furnished to them throughout the year, as well as information prepared specifically in connection with their review of the agreement, and were advised by their independent counsel. They considered the factors discussed below, among others, but did not identify any single issue or particular piece of information that, in isolation, was the controlling factor.
1. Nature, extent and quality of services
The board and the committee considered the depth and quality of CRMC’s investment management process, including its global research capabilities; the experience, capability and integrity of its senior management and other personnel; the low turnover rates of its key personnel; the overall financial strength and stability of its organization; and the ongoing evolution of CRMC’s organizational structure designed to maintain and strengthen these qualities. The board and the committee also considered the nature, extent and quality of administrative, compliance and shareholder services provided by CRMC to the fund under the agreement and other agreements, as well as the benefits to fund shareholders from investing in a fund that is part of a large family of funds. The board and the committee concluded that the nature, extent and quality of the services provided by CRMC have benefited and should continue to benefit the fund and its shareholders.
2. Investment results
The board and the committee considered the investment results of the fund in light of its objective of providing long-term growth of capital. They compared the fund’s total returns with those of other relevant funds (including the other funds that are the basis of the Lipper index for the category in which the fund is included) and market data such as relevant market indices, in each case as available at the time of the related board and committee meetings. This report, including the letter to shareholders and related disclosures, contains certain information about the fund’s investment results. The board and the committee concluded that the fund’s long-term results have been satisfactory and that CRMC’s record in managing the fund indicated that its continued management should benefit the fund and its shareholders.
3. Advisory fees and total expenses
The board and the committee compared the advisory fees and total expense levels of the fund to those of other relevant funds. They observed that the fund’s advisory fees and expenses remain significantly below those of most other relevant funds. The board and the committee also noted the breakpoint discounts in the fund’s advisory fee structure that reduce the level of fees charged by CRMC to the fund as fund assets increase. In addition, they reviewed information regarding the advisory fees paid by clients of an affiliate of CRMC. They noted that, to the extent there were differences between the advisory fees paid by the fund and the advisory fees paid by those clients, the differences appropriately reflected the investment, operational and regulatory differences between advising the fund and the other clients. The board and the committee concluded that the fund’s cost structure was fair and reasonable in relation to the services provided, and that the shareholders receive reasonable value in return for the advisory fees and other amounts paid to CRMC by the fund.
4. Ancillary benefits
The board and the committee considered a variety of other benefits received by CRMC and its affiliates as a result of CRMC’s relationship with the fund and the other American Funds, including fees for administrative services provided to certain share classes; fees paid to CRMC’s affiliated transfer agent; sales charges and distribution fees received and retained by the fund’s principal underwriter, an affiliate of CRMC; and possible ancillary benefits to CRMC’s institutional management affiliates. The board and the committee reviewed CRMC’s portfolio trading practices, noting that while CRMC receives the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the fund, it does not obtain third-party research or other services in return for allocating brokerage to such broker-dealers. The board and the committee took these ancillary benefits into account in evaluating the reasonableness of the advisory fees and other amounts paid to CRMC by the fund.
5. Adviser financial information
The board and the committee reviewed information regarding CRMC’s costs of providing services to the American Funds, including personnel, systems and resources of investment, compliance, trading, accounting and other administrative operations. They considered CRMC’s costs and willingness to invest in technology, infrastructure and staff to maintain and expand services and capabilities, respond to industry and regulatory developments, and attract and retain qualified personnel. They noted information regarding the compensation structure for CRMC’s investment professionals. The board and the committee also compared CRMC’s profitability to the reported results of several large, publicly held investment management companies. The board and the committee noted the competitiveness and cyclicality of both the mutual fund industry and the capital markets, and the importance in that environment of CRMC’s long-term profitability for maintaining its independence, company culture and management continuity. They further considered the breakpoint discounts in the fund’s advisory fee structure. The board and the committee concluded that the fund’s advisory fee structure reflected a reasonable sharing of benefits between CRMC and the fund’s shareholders.
Other share class results
unaudited
Classes B, C, F and 529
Fund results shown are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. For current information and month-end results, visit americanfunds.com.
Average annual total returns for periods ended March 31, 2012: | ||||||||||||
10 years/ | ||||||||||||
1 year | 5 years | Life of class1 | ||||||||||
Class B shares2 | ||||||||||||
Reflecting applicable contingent deferred sales charge | ||||||||||||
(CDSC), maximum of 5%, payable only if shares | ||||||||||||
are sold within six years of purchase | –11.57 | % | –0.79 | % | 6.99 | % | ||||||
Not reflecting CDSC | –6.95 | –0.45 | 6.99 | |||||||||
Class C shares | ||||||||||||
Reflecting CDSC, maximum of 1%, payable only | ||||||||||||
if shares are sold within one year of purchase | –7.89 | –0.48 | 6.76 | |||||||||
Not reflecting CDSC | –6.97 | –0.48 | 6.76 | |||||||||
Class F-1 shares3 | ||||||||||||
Not reflecting annual asset-based fee charged | ||||||||||||
by sponsoring firm | –6.25 | 0.28 | 7.60 | |||||||||
Class F-2 shares3 — first sold 8/1/08 | ||||||||||||
Not reflecting annual asset-based fee charged | ||||||||||||
by sponsoring firm | –6.02 | — | 0.82 | |||||||||
Class 529-A shares4 | ||||||||||||
Reflecting 5.75% maximum sales charge | –11.69 | –0.93 | 6.95 | |||||||||
Not reflecting maximum sales charge | –6.30 | 0.25 | 7.58 | |||||||||
Class 529-B shares2,4 | ||||||||||||
Reflecting applicable CDSC, maximum of 5%, payable | ||||||||||||
only if shares are sold within six years of purchase | –11.67 | –0.90 | 6.84 | |||||||||
Not reflecting CDSC | –7.05 | –0.56 | 6.84 | |||||||||
Class 529-C shares4 | ||||||||||||
Reflecting CDSC, maximum of 1%, payable only | ||||||||||||
if shares are sold within one year of purchase | –7.97 | –0.55 | 6.68 | |||||||||
Not reflecting CDSC | –7.05 | –0.55 | 6.68 | |||||||||
Class 529-E shares3,4 | –6.58 | –0.05 | 7.23 | |||||||||
Class 529-F-1 shares3,4 — first sold 9/16/02 | ||||||||||||
Not reflecting annual asset-based fee charged | ||||||||||||
by sponsoring firm | –6.09 | 0.46 | 10.20 |
1Applicable to Class F-2 and 529-F-1 shares only. All other share classes reflect 10-year results. |
2These shares are not available for purchase. |
3These shares are sold without any initial or contingent deferred sales charge. |
4Results shown do not reflect the $10 account setup fee and an annual $10 account maintenance fee. |
Investment results assume all distributions are reinvested and reflect applicable fees and expenses. When applicable, investment results reflect fee waivers, without which results would have been lower. See americanfunds.com for more information.
For information regarding the differences among the various share classes, refer to the fund’s prospectus.
Board of trustees and other officers
“Independent” trustees1 | ||
Year first | ||
elected a | ||
trustee of | ||
Name and age | the fund2 | Principal occupation(s) during past five years |
Elisabeth Allison, 65 | 1991 | Senior Business Advisor, Harvard Medical School; |
former Partner, ANZI, Ltd. (transactional work | ||
specializing in joint ventures and strategic alliances) | ||
Vanessa C.L. Chang, 59 | 2005 | Director, EL & EL Investments (real estate) |
Jaime Chico Pardo, 62 | 2011 | Chairman of the Board and CEO, ENESA (private |
fund primarily operating and investing in the energy | ||
and health care sectors); former Co-Chairman, IDEAL | ||
(public company investing and operating infrastructure assets); former Vice Chairman of the Board and CEO, TELMEX (telecommunications) | ||
Nicholas Donatiello, Jr., 51 | 2008 | President and CEO, Odyssey Ventures, Inc. |
(business strategy and marketing consulting) | ||
Robert A. Fox, 75 | 1984 | Managing General Partner, Fox Investments LP; |
corporate director | ||
Koichi Itoh, 71 | 1994 | Chairman of the Board, Itoh Building Co., Ltd. |
Chairman of the Board | (building management) | |
(Independent and | ||
Non-Executive) | ||
William H. Kling, 70 | 1987 | President Emeritus, American Public Media |
John G. McDonald, 75 | 1984 | Stanford Investors Professor, Graduate School of |
Business, Stanford University | ||
William I. Miller, 56 | 1992 | President, The Wallace Foundation; Chairman of the |
Board, Irwin Management Company; former | ||
Chairman of the Board and CEO, Irwin Financial | ||
Corporation | ||
Alessandro Ovi, 68 | 2002 | Publisher and Editor, Technology Review; President, |
TechRev.srl; former Special Advisor to the Italian | ||
Prime Minister; former Special Advisor to the | ||
President of the European Commission | ||
“Independent” trustees1 | ||
Number of | ||
portfolios | ||
in fund | ||
complex3 | ||
overseen by | ||
Name and age | trustee | Other directorships4 held by trustee |
Elisabeth Allison, 65 | 3 | None |
Vanessa C.L. Chang, 59 | 6 | Edison International |
Jaime Chico Pardo, 62 | 3 | AT&T; Honeywell International; IDEAL |
Nicholas Donatiello, Jr., 51 | 3 | Dolby Laboratories, Inc. |
Robert A. Fox, 75 | 9 | None |
Koichi Itoh, 71 | 6 | None |
Chairman of the Board | ||
(Independent and | ||
Non-Executive) | ||
William H. Kling, 70 | 10 | None |
John G. McDonald, 75 | 13 | iStar Financial, Inc.; Plum Creek Timber Co.; |
QuinStreet, Inc.; Scholastic Corporation | ||
William I. Miller, 56 | 3 | Cummins, Inc. |
Alessandro Ovi, 68 | 3 | Guala Closures SpA; Landi Renzo SpA; |
ST Microelectronics SNV; Telecom Italia Media SpA |
“Interested” trustees5 | ||
Year first | ||
elected a | ||
trustee or | Principal occupation(s) during past five years and | |
Name, age and | officer of | positions held with affiliated entities or the |
position with fund | the fund2 | principal underwriter of the fund |
Gina H. Despres, 70 | 1999 | Senior Vice President, Capital Research and |
Vice Chairman of the Board | Management Company; Senior Vice President, | |
Capital Strategy Research, Inc.6 | ||
Carl M. Kawaja, 47 | 2003 | Senior Vice President — Capital World Investors, |
President | Capital Research and Management Company; | |
Director, Capital International, Inc.;6 Chairman of the | ||
Board, Capital International Asset Management | ||
(Canada), Inc.;6 Director, The Capital Group | ||
Companies, Inc.6 | ||
“Interested” trustees5 | ||
Number of | ||
portfolios | ||
in fund | ||
complex3 | ||
Name, age and | overseen by | |
position with fund | trustee | Other directorships4 held by trustee |
Gina H. Despres, 70 | 3 | None |
Vice Chairman of the Board | ||
Carl M. Kawaja, 47 | 1 | None |
President |
The fund’s statement of additional information includes further details about fund trustees and is available without charge upon request by calling American Funds Service Company at 800/421-4225 or by visiting the American Funds website at americanfunds.com. The address for all trustees and officers of the fund is 333 South Hope Street, Los Angeles, CA 90071, Attention: Secretary.
See page 36 for footnotes.
Other officers7 | ||
Year first | ||
elected | Principal occupation(s) during past five years | |
Name, age and | an officer | and positions held with affiliated entities or the |
position with fund | of the fund2 | principal underwriter of the fund |
Stephen E. Bepler, 69 | 1984 | Senior Vice President — Capital Research Global |
Executive Vice President | Investors, Capital Research Company6 | |
Mark E. Denning, 54 | 1994 | Senior Vice President — Capital Research Global |
Executive Vice President | Investors, Capital Research Company;6 Director, | |
Capital Research and Management Company | ||
Sung Lee, 45 | 2003 | Senior Vice President — Capital Research Global |
Senior Vice President | Investors, Capital Research Company;6 Director, | |
The Capital Group Companies, Inc.6 | ||
Robert W. Lovelace, 49 | 1996 | Executive Vice President and Director, Capital |
Senior Vice President | Research and Management Company; Senior Vice | |
President — Capital World Investors, Capital | ||
Research and Management Company; Director, | ||
The Capital Group Companies, Inc.6 | ||
Michael J. Thawley, 62 | 2008 | Senior Vice President, Capital Research and |
Senior Vice President | Management Company; Senior Vice President | |
and International Advisor, Capital Strategy | ||
Research, Inc.;6 former Australian Ambassador | ||
to the United States | ||
Walter R. Burkley, 45 | 2012 | Senior Vice President and Senior Counsel — Fund |
Vice President | Business Management Group, Capital Research and | |
Management Company | ||
Michael J. Downer, 57 | 2004 | Director, Senior Vice President and Secretary — |
Vice President | Capital Research and Management Company; | |
Director, American Funds Distributors, Inc.;6 | ||
Chairman of the Board, Capital Bank and Trust | ||
Company6 | ||
Nicholas J. Grace, 46 | 2004 | Senior Vice President — Capital World Investors, |
Vice President | Capital Research Company6 | |
Jesper Lyckeus, 44 | 2010 | Senior Vice President — Capital Research Global |
Vice President | Investors, Capital Research Company6 | |
Didier Rheme, 41 | 2010 | Senior Vice President — Capital Research Global |
Vice President | Investors, Capital Research Company6 | |
Joerg Sponer, 40 | 2010 | Vice President — Capital Research Global Investors, |
Vice President | Capital Research Company6 | |
Vincent P. Corti, 55 | 1984 | Vice President — Fund Business Management |
Secretary | Group, Capital Research and Management Company | |
Brian C. Janssen, 40 | 2010 | Senior Manager — Fund Accounting, Capital |
Treasurer | Research and Management Company | |
Tanya Schneider, 39 | 2007 | Assistant Vice President — Fund Business |
Assistant Secretary | Management Group, Capital Research and Management Company | |
Dori Laskin, 60 | 2010 | Vice President — Fund Business Management |
Assistant Treasurer | Group, Capital Research and Management Company | |
Ari M. Vinocor, 37 | 2011 | Vice President — Fund Business Management |
Assistant Treasurer | Group, Capital Research and Management Company |
1The term “independent” trustee refers to a trustee who is not an “interested person” of the fund within the meaning of the Investment Company Act of 1940. |
2Trustees and officers of the fund serve until their resignation, removal or retirement. |
3Capital Research and Management Company manages the American Funds. Capital Research and Management Company also manages American Funds Insurance Series,® which is composed of 18 funds and serves as the underlying investment vehicle for certain variable insurance contracts; American Funds Portfolio Series,SM which is composed of 8 funds; and American Funds Target Date Retirement Series,® which is composed of 10 funds and is available through tax-deferred retirement plans and IRAs. |
4This includes all directorships (other than those in the American Funds or other funds managed by Capital Research and Management Company) that are held by each trustee as a trustee or director of a public company or a registered investment company. |
5“Interested persons” within the meaning of the Investment Company Act of 1940, on the basis of their affiliation with the fund’s investment adviser, Capital Research and Management Company, or affiliated entities (including the fund’s principal underwriter). |
6Company affiliated with Capital Research and Management Company. |
7All of the officers listed are officers and/or directors/trustees of one or more of the other funds for which Capital Research and Management Company serves as investment adviser. |
Offices of the fund and of the investment adviser
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406
6455 Irvine Center Drive
Irvine, CA 92618
Custodian of assets
JPMorgan Chase Bank
270 Park Avenue
New York, NY 10017-2070
Transfer agent for shareholder accounts
American Funds Service Company
(Write to the address near you.)
P.O. Box 6007
Indianapolis, IN 46206-6007
P.O. Box 2280
Norfolk, VA 23501-2280
Counsel
K&L Gates LLP
Four Embarcadero Center, Suite 1200
San Francisco, CA 94111-5994
Independent registered public accounting firm
Deloitte & Touche LLP
695 Town Center Drive
Suite 1200
Costa Mesa, CA 92626-7188
Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at 800/421-4225 or visit the American Funds website at americanfunds.com.
“American Funds Proxy Voting Procedures and Principles” — which describes how we vote proxies relating to portfolio securities — is available on the American Funds website or upon request by calling AFS. The fund files its proxy voting record with the U.S. Securities and Exchange Commission (SEC) for the 12 months ended June 30 by August 31. The proxy voting record is available free of charge on the SEC website at sec.gov and on the American Funds website.
A complete March 31, 2012, portfolio of EuroPacific Growth Fund’s investments is available free of charge by calling AFS or visiting the SEC website (where it is part of Form N-CSR).
EuroPacific Growth Fund files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. This filing is available free of charge on the SEC website. You may also review or, for a fee, copy this filing at the SEC’s Public Reference Room in Washington, D.C. Additional information regarding the operation of the Public Reference Room may be obtained by calling the SEC’s Office of Investor Education and Advocacy at 800/SEC-0330. Additionally, the list of portfolio holdings is available by calling AFS.
This report is for the information of shareholders of EuroPacific Growth Fund, but it also may be used as sales literature when preceded or accompanied by the current prospectus or summary prospectus, which gives details about charges, expenses, investment objectives and operating policies of the fund. If used as sales material after June 30, 2012, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter.
The American Funds difference
Since 1931, American Funds has helped investors pursue long-term investment success. Our consistent approach — in combination with a proven system — has resulted in a superior long-term track record.
Consistent approach
We base our decisions on a long-term perspective because we believe it is the best way to achieve superior long-term investment results. Our portfolio counselors average 25 years of investment experience, including 21 years at our company, reflecting a career commitment to our long-term approach.1
Proven system
Our system combines individual accountability with teamwork. Each fund is divided into portions that are managed by investment professionals with varied backgrounds, ages and investment styles. An extensive global research effort is the backbone of our system.
Superior long-term track record
Our equity funds have beaten their Lipper peer indexes in 91% of 10-year periods and 96% of 20-year periods. Our fixed-income funds have beaten their Lipper indexes in 60% of 10-year periods and 67% of 20-year periods.2 Our fund management fees have been among the lowest in the industry.3
1 As of 12/31/11. |
2 Based on Class A share results for periods through 12/31/11. Periods covered are the shorter of the fund’s lifetime or since the comparable Lipper index inception date. |
3 Based on management fees for the 20-year period ended 12/31/11 versus comparable Lipper categories, excluding funds of funds. |
American Funds span a range of investment objectives
•Growth funds |
Emphasis on long-term growth through stocks |
AMCAP Fund® |
EuroPacific Growth Fund® |
The Growth Fund of America® |
The New Economy Fund® |
New Perspective Fund® |
New World Fund® |
SMALLCAP World Fund® |
•Growth-and-income funds |
Emphasis on long-term growth and dividends through stocks |
American Mutual Fund® |
Capital World Growth and Income Fund® |
Fundamental InvestorsSM |
International Growth and Income FundSM |
The Investment Company of America® |
Washington Mutual Investors FundSM |
•Equity-income funds |
Emphasis on above-average income and growth through stocks and/or bonds |
Capital Income Builder® |
The Income Fund of America® |
•Balanced funds |
Emphasis on long-term growth and current income through stocks and bonds |
American Balanced Fund® |
American Funds Global Balanced FundSM |
•Bond funds |
Emphasis on current income through bonds |
American Funds Mortgage Fund® |
American High-Income TrustSM |
The Bond Fund of AmericaSM |
Capital World Bond Fund® |
Intermediate Bond Fund of America® |
Short-Term Bond Fund of AmericaSM |
U.S. Government Securities FundSM |
•Tax-exempt bond funds |
Emphasis on tax-exempt current income through municipal bonds |
American Funds Short-Term Tax-Exempt Bond FundSM |
American High-Income Municipal Bond Fund® |
Limited Term Tax-Exempt Bond Fund of AmericaSM |
The Tax-Exempt Bond Fund of America® |
State-specific tax-exempt funds |
American Funds Tax-Exempt Fund of New York® |
The Tax-Exempt Fund of California® |
The Tax-Exempt Fund of Maryland® |
The Tax-Exempt Fund of Virginia® |
•Money market fund |
American Funds Money Market Fund® |
•American Funds Portfolio SeriesSM |
American Funds Global Growth PortfolioSM |
American Funds Growth PortfolioSM |
American Funds Growth and Income PortfolioSM |
American Funds Balanced PortfolioSM |
American Funds Income PortfolioSM |
American Funds Tax-Advantaged Income PortfolioSM |
American Funds Preservation PortfolioSM |
American Funds Tax-Exempt Preservation PortfolioSM |
•American Funds Target Date Retirement Series® |
American Funds Capital Research and Management Capital International Capital Guardian Capital Bank and Trust
Lit. No. MFGEAR-916-0512P
Litho in USA AGD/Q/8055-S28694
Printed on paper containing 10% post-consumer waste
Printed with inks containing soy and/or vegetable oil
ITEM 2 – Code of Ethics
The Registrant has adopted a Code of Ethics that applies to its Principal Executive Officer and Principal Financial Officer. The Registrant undertakes to provide to any person without charge, upon request, a copy of the Code of Ethics. Such request can be made to American Funds Service Company at 800/421-0180 or to the Secretary of the Registrant, 333 South Hope Street, Los Angeles, California 90071.
ITEM 3 – Audit Committee Financial Expert
The Registrant’s board has determined that Vanessa C. L. Chang, a member of the Registrant’s audit committee, is an “audit committee financial expert” and "independent," as such terms are defined in this Item. This designation will not increase the designee’s duties, obligations or liability as compared to his or her duties, obligations and liability as a member of the audit committee and of the board, nor will it reduce the responsibility of the other audit committee members. There may be other individuals who, through education or experience, would qualify as "audit committee financial experts" if the board had designated them as such. Most importantly, the board believes each member of the audit committee contributes significantly to the effective oversight of the Registrant’s financial statements and condition.
ITEM 4 – Principal Accountant Fees and Services
Registrant: | ||||
a) Audit Fees: | ||||
2011 | $100,000 | |||
2012 | $107,000 | |||
b) Audit-Related Fees: | ||||
2011 | $ 23,000 | |||
2012 | $ 42,000 | |||
The audit-related fees consist of assurance and related services relating to the examination of the Registrant’s investment adviser conducted in accordance with Statement on Standards for Attestation Engagements Number 16 (which replaced Statement on Auditing Standards Number 70) issued by the American Institute of Certified Public Accountants. | ||||
c) Tax Fees: | ||||
2011 | $ 13,000 | |||
2012 | $ 29,000 | |||
The tax fees consist of professional services relating to the preparation of the Registrant’s tax returns including returns relating to the Registrant’s investments in non-U.S. jurisdictions. | ||||
d) All Other Fees: | ||||
2011 | None | |||
2012 | None | |||
Adviser and affiliates (includes only fees for non-audit services billed to the adviser and affiliates for engagements that relate directly to the operations and financial reporting of the Registrant and were subject to the pre-approval policies described below): | ||||
a) Audit Fees: | ||||
Not Applicable | ||||
b) Audit-Related Fees: | ||||
2011 | $ 975,000 | |||
2012 | $ 915,000 | |||
The audit-related fees consist of assurance and related services relating to the examination of the Registrant’s transfer agent, principal underwriter and investment adviser conducted in accordance with Statement on Standards for Attestation Engagements Number 16 (which replaced Statement on Auditing Standards Number 70) issued by the American Institute of Certified Public Accountants. | ||||
c) Tax Fees: | ||||
2011 | $ 17,000 | |||
2012 | $ 63,000 | |||
The tax fees consist of consulting services relating to the Registrant’s investments. | ||||
d) All Other Fees: | ||||
2011 | $ 2,000 | |||
2012 | $ 2,000 | |||
The other fees consist of subscription services related to an accounting research tool. |
All audit and permissible non-audit services that the Registrant’s audit committee considers compatible with maintaining the independent registered public accounting firm’s independence are required to be pre-approved by the committee. The pre-approval requirement will extend to all non-audit services provided to the Registrant, the investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the Registrant, if the engagement relates directly to the operations and financial reporting of the Registrant. The committee will not delegate its responsibility to pre-approve these services to the investment adviser. The committee may delegate to one or more committee members the authority to review and pre-approve audit and permissible non-audit services. Actions taken under any such delegation will be reported to the full committee at its next meeting. The pre-approval requirement is waived with respect to non-audit services if certain conditions are met. The pre-approval requirement was not waived for any of the non-audit services listed above provided to the Registrant, adviser and affiliates.
Aggregate non-audit fees paid to the Registrant’s auditors, including fees for all services billed to the Registrant, adviser and affiliates that provide ongoing services to the Registrant, were $1,506,000 for fiscal year 2011 and $1,589,000 for fiscal year 2012. The non-audit services represented by these amounts were brought to the attention of the committee and considered to be compatible with maintaining the auditors’ independence.
ITEM 5 – Audit Committee of Listed Registrants
Not applicable to this Registrant, insofar as the Registrant is not a listed issuer as defined in Rule 10A-3 under the Securities Exchange Act of 1934.
ITEM 6 – Schedule of Investments
EuroPacific Growth Fund®
Investment portfolio
March 31, 2012
Common stocks — 92.87% | Shares | Value (000) | ||||||
FINANCIALS — 16.92% | ||||||||
Prudential PLC | 90,654,384 | $ | 1,083,888 | |||||
Housing Development Finance Corp. Ltd. | 69,939,297 | 924,332 | ||||||
Deutsche Bank AG | 16,980,552 | 844,845 | ||||||
Barclays PLC | 206,233,323 | 776,020 | ||||||
UniCredit SpA | 127,901,060 | 640,705 | ||||||
Agricultural Bank of China, Class H | 1,485,594,000 | 637,048 | ||||||
HDFC Bank Ltd. | 56,659,394 | 578,160 | ||||||
Ping An Insurance (Group) Co. of China, Ltd., Class H | 63,730,000 | 481,737 | ||||||
Société Générale | 16,391,896 | 480,196 | ||||||
ICICI Bank Ltd. | 27,210,410 | 475,468 | ||||||
AXA SA | 27,603,268 | 457,604 | ||||||
Toronto-Dominion Bank | 5,190,000 | 440,509 | ||||||
Fairfax Financial Holdings Ltd. | 711,291 | 286,358 | ||||||
Fairfax Financial Holdings Ltd. (CAD denominated) | 325,000 | 131,176 | ||||||
AIA Group Ltd. | 112,392,400 | 411,763 | ||||||
Sberbank of Russia (ADR) | 30,698,375 | 402,251 | ||||||
Industrial and Commercial Bank of China Ltd., Class H | 611,840,409 | 394,733 | ||||||
Bank of China Ltd., Class H | 977,853,600 | 394,136 | ||||||
Hana Financial Holdings | 10,138,000 | 382,060 | ||||||
Banco Bradesco SA, preferred nominative | 21,565,243 | 376,738 | ||||||
Siam Commercial Bank PCL | 79,914,000 | 371,723 | ||||||
Kotak Mahindra Bank Ltd. | 31,467,137 | 336,846 | ||||||
Credit Suisse Group AG | 11,810,871 | 336,650 | ||||||
Banco Santander, SA | 43,363,380 | 333,701 | ||||||
Bank of Nova Scotia | 5,835,200 | 326,905 | ||||||
Brookfield Asset Management Inc., Class A | 10,352,000 | 326,813 | ||||||
Itaú Unibanco Holding SA, preferred nominative (ADR) | 8,444,022 | 162,041 | ||||||
Itaú Unibanco Holding SA, preferred nominative | 8,331,699 | 159,427 | ||||||
BNP Paribas SA | 5,947,508 | 282,188 | ||||||
UBS AG1 | 19,194,295 | 268,979 | ||||||
Westfield Group | 26,750,000 | 244,670 | ||||||
Bank of Ireland1 | 1,475,842,276 | 244,073 | ||||||
Ayala Land, Inc. | 481,283,600 | 232,599 | ||||||
China Construction Bank Corp., Class H | 278,270,000 | 215,003 | ||||||
Sampo Oyj, Class A | 6,613,722 | 191,145 | ||||||
Royal Bank of Canada | 2,612,504 | 151,415 | ||||||
Sino Land Co. Ltd. | 94,608,336 | 151,070 | ||||||
DNB ASA | 11,417,796 | 146,764 | ||||||
Banco Bilbao Vizcaya Argentaria, SA | 17,885,507 | 142,336 | ||||||
Erste Bank der oesterreichischen Sparkassen AG | 5,763,451 | 132,903 | ||||||
ING Groep NV, depository receipts1 | 15,524,880 | 129,347 | ||||||
Resona Holdings, Inc. | 27,900,000 | 128,427 | ||||||
Royal Bank of Scotland Group PLC1 | 269,930,602 | 119,337 | ||||||
PT Bank Central Asia Tbk | 133,720,000 | 116,990 | ||||||
Woori Finance Holdings Co., Ltd. | 9,964,000 | 114,321 | ||||||
Mizuho Financial Group, Inc. | 65,920,000 | 107,517 | ||||||
Daito Trust Construction Co., Ltd. | 1,197,000 | 107,451 | ||||||
HSBC Holdings PLC (Hong Kong) | 11,738,967 | 103,550 | ||||||
PartnerRe Holdings Ltd. | 1,395,000 | 94,707 | ||||||
Samsung Card Co., Ltd. | 2,711,988 | 94,425 | ||||||
Türkiye Garanti Bankasi AS | 22,163,923 | 87,795 | ||||||
Banco Santander (Brasil) SA, units | 7,946,600 | 73,134 | ||||||
Banco Santander (Brasil) SA, units (ADR) | 1,554,600 | 14,256 | ||||||
CITIC Securities Co. Ltd., Class H1 | 41,948,000 | 84,268 | ||||||
China Taiping Insurance Holdings Co. Ltd.1 | 34,020,000 | 66,502 | ||||||
China Life Insurance Co. Ltd., Class H | 20,360,000 | 52,830 | ||||||
Standard Chartered PLC | 2,040,000 | 50,902 | ||||||
Chongqing Rural Commercial Bank Co., Ltd., Class H1 | 106,529,000 | 50,893 | ||||||
Lloyds Banking Group PLC1 | 87,359,895 | 46,957 | ||||||
Deutsche Börse AG | 493,000 | 33,191 | ||||||
Shinhan Financial Group Co., Ltd. | 848,040 | 32,745 | ||||||
China Pacific Insurance (Group) Co., Ltd., Class H | 9,180,000 | 28,431 | ||||||
Svenska Handelsbanken AB, Class A | 550,000 | 17,533 | ||||||
PT Bank Mandiri (Persero) Tbk, Series B | 17,022,000 | 12,752 | ||||||
State Bank of India | 159,609 | 6,568 | ||||||
17,131,807 | ||||||||
CONSUMER DISCRETIONARY — 12.62% | ||||||||
Honda Motor Co., Ltd. | 29,509,250 | 1,121,259 | ||||||
Volkswagen AG, nonvoting preferred | 4,134,575 | 727,058 | ||||||
Kia Motors Corp. | 9,601,717 | 627,940 | ||||||
Hyundai Motor Co. | 3,005,890 | 618,130 | ||||||
Bayerische Motoren Werke AG | 6,246,000 | 561,711 | ||||||
Tata Motors Ltd. | 99,854,955 | 539,505 | ||||||
Daimler AG | 8,578,088 | 517,229 | ||||||
Daimler AG (New York registered) | 125,000 | 7,564 | ||||||
Li & Fung Ltd. | 226,130,000 | 518,912 | ||||||
Hyundai Mobis Co., Ltd. | 1,888,000 | 477,395 | ||||||
H & M Hennes & Mauritz AB, Class B | 12,281,000 | 444,402 | ||||||
adidas AG | 5,658,000 | 441,747 | ||||||
Nikon Corp. | 14,304,200 | 434,120 | ||||||
Naspers Ltd., Class N | 7,350,000 | 412,964 | ||||||
Hero MotoCorp Ltd. | 9,975,363 | 402,431 | ||||||
Toyota Motor Corp. | 8,265,000 | 356,482 | ||||||
Nissan Motor Co., Ltd. | 32,024,800 | 340,871 | ||||||
British Sky Broadcasting Group PLC | 29,070,000 | 314,323 | ||||||
Sands China Ltd. | 76,156,800 | 297,643 | ||||||
Swatch Group Ltd, non-registered shares | 498,800 | 229,591 | ||||||
Swatch Group Ltd | 588,601 | 47,306 | ||||||
Cie. Générale des Établissements Michelin, Class B | 3,506,615 | 261,104 | ||||||
Industria de Diseño Textil, SA | 2,578,000 | 246,937 | ||||||
PT Astra International Tbk | 26,543,500 | 214,664 | ||||||
Burberry Group PLC | 8,922,000 | 213,633 | ||||||
WPP PLC | 13,768,000 | 188,177 | ||||||
Shangri-La Asia Ltd. | 81,690,000 | 178,622 | ||||||
Rakuten, Inc. | 168,361 | 176,355 | ||||||
LVMH Moët Hennessey-Louis Vuitton SA | 980,000 | 168,410 | ||||||
Yamada Denki Co., Ltd. | 2,692,150 | 168,158 | ||||||
Ctrip.com International, Ltd. (ADR)1 | 6,807,000 | 147,304 | ||||||
Renault SA | 2,793,065 | 147,235 | ||||||
Belle International Holdings Ltd. | 81,200,000 | 145,763 | ||||||
Nokian Renkaat Oyj | 2,920,022 | 142,303 | ||||||
Intercontinental Hotels Group PLC | 4,945,000 | 114,925 | ||||||
Truworths International Ltd. | 10,700,000 | 112,649 | ||||||
JCDecaux SA1 | 3,528,700 | 107,820 | ||||||
Fiat SpA | 16,530,000 | 97,179 | ||||||
Suzuki Motor Corp. | 3,946,333 | 94,260 | ||||||
Isuzu Motors Ltd. | 14,500,000 | 84,964 | ||||||
Carnival PLC | 2,500,000 | 79,895 | ||||||
SES SA, Class A (FDR) | 2,988,363 | 74,152 | ||||||
Techtronic Industries Co. Ltd. | 43,815,000 | 59,243 | ||||||
Dongfeng Motor Group Co., Ltd., Class H | 26,200,000 | 47,302 | ||||||
Kingfisher PLC | 9,259,650 | 45,425 | ||||||
Whitbread PLC | 642,382 | 18,947 | ||||||
12,774,009 | ||||||||
CONSUMER STAPLES — 10.69% | ||||||||
Nestlé SA | 27,091,200 | 1,704,642 | ||||||
British American Tobacco PLC | 26,014,999 | 1,310,954 | ||||||
Anheuser-Busch InBev NV | 17,544,623 | 1,281,812 | ||||||
Anheuser-Busch InBev NV, VVPR STRIPS1 | 10,093,238 | 40 | ||||||
Pernod Ricard SA | 6,096,672 | 637,481 | ||||||
Danone SA | 8,502,168 | 593,048 | ||||||
L’Oréal SA | 3,065,000 | 378,080 | ||||||
L’Oréal SA, bonus shares2 | 1,041,600 | 128,485 | ||||||
Shoprite Holdings Ltd. | 25,335,000 | 453,460 | ||||||
Associated British Foods PLC | 19,280,000 | 376,228 | ||||||
Koninklijke Ahold NV | 24,513,000 | 339,680 | ||||||
Unilever NV, depository receipts | 9,417,000 | 320,454 | ||||||
SABMiller PLC | 7,886,000 | 316,540 | ||||||
Hengan International Group Co. Ltd. | 27,734,000 | 280,356 | ||||||
OJSC Magnit (GDR) | 9,433,586 | 274,895 | ||||||
China Resources Enterprise, Ltd. | 76,826,000 | 268,105 | ||||||
Asahi Group Holdings, Ltd. | 10,716,700 | 237,329 | ||||||
Wal-Mart de México, SAB de CV, Series V | 65,671,436 | 221,030 | ||||||
Wilmar International Ltd. | 54,938,000 | 214,149 | ||||||
Japan Tobacco Inc. | 33,500 | 188,607 | ||||||
Coca-Cola Amatil Ltd. | 12,428,216 | 160,536 | ||||||
ITC Ltd. | 33,862,622 | 150,818 | ||||||
Diageo PLC | 5,500,000 | 132,179 | ||||||
Cia. de Bebidas das Américas – AmBev, preferred nominative (ADR) | 3,165,000 | 130,778 | ||||||
China Yurun Food Group Ltd. | 88,145,000 | 125,313 | ||||||
Carlsberg A/S, Class B | 1,360,301 | 112,393 | ||||||
Coca-Cola Hellenic Bottling Co. SA | 5,700,000 | 109,090 | ||||||
Tingyi (Cayman Islands) Holding Corp. | 36,089,000 | 104,332 | ||||||
Woolworths Ltd. | 3,350,626 | 90,170 | ||||||
Unilever PLC | 2,526,750 | 83,417 | ||||||
Olam International Ltd. | 25,475,000 | 47,827 | ||||||
Wesfarmers Ltd. | 1,498,120 | 46,586 | ||||||
10,818,814 | ||||||||
HEALTH CARE — 10.19% | ||||||||
Novo Nordisk A/S, Class B | 22,139,400 | 3,065,272 | ||||||
Novartis AG | 34,036,725 | 1,883,765 | ||||||
Bayer AG | 19,450,425 | 1,368,130 | ||||||
Teva Pharmaceutical Industries Ltd. (ADR) | 24,512,300 | 1,104,524 | ||||||
Roche Holding AG | 4,572,007 | 795,682 | ||||||
CSL Ltd. | 14,104,329 | 524,352 | ||||||
UCB SA3 | 11,918,602 | 514,230 | ||||||
Sonova Holding AG | 2,660,000 | 295,556 | ||||||
William Demant Holding A/S1 | 1,625,226 | 151,469 | ||||||
Grifols, SA, Class A1 | 6,050,000 | 129,102 | ||||||
Sinopharm Group Co. Ltd., Class H | 47,029,800 | 131,419 | ||||||
Merck KGaA | 1,098,724 | 121,596 | ||||||
Terumo Corp. | 2,175,000 | 103,928 | ||||||
Essilor International | 1,002,000 | 89,310 | ||||||
Fresenius Medical Care AG & Co. KGaA | 480,000 | 34,019 | ||||||
10,312,354 | ||||||||
INFORMATION TECHNOLOGY — 10.17% | ||||||||
Samsung Electronics Co. Ltd. | 2,049,475 | 2,306,236 | ||||||
Samsung Electronics Co. Ltd., nonvoting preferred | 48,800 | 34,240 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 408,265,136 | 1,174,396 | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 5,822,723 | 88,971 | ||||||
HTC Corp. | 36,059,010 | 729,378 | ||||||
SAP AG | 5,617,000 | 392,249 | ||||||
SAP AG (ADR) | 2,625,000 | 183,278 | ||||||
ASML Holding NV | 11,330,222 | 566,365 | ||||||
Tencent Holdings Ltd. | 19,585,000 | 546,273 | ||||||
Murata Manufacturing Co., Ltd. | 8,999,700 | 533,328 | ||||||
Infineon Technologies AG | 49,795,000 | 509,111 | ||||||
Canon, Inc. | 9,212,500 | 435,192 | ||||||
Nintendo Co., Ltd. | 2,437,700 | 366,671 | ||||||
NetEase.com, Inc. (ADR)1 | 5,852,400 | 340,024 | ||||||
Quanta Computer Inc. | 99,894,000 | 261,628 | ||||||
Arm Holdings PLC | 26,970,000 | 255,380 | ||||||
HOYA Corp. | 10,860,000 | 243,914 | ||||||
Nokia Corp. | 40,800,000 | 222,122 | ||||||
Baidu, Inc., Class A (ADR)1 | 1,280,000 | 186,586 | ||||||
Hirose Electric Co., Ltd. | 1,242,300 | 130,429 | ||||||
Hon Hai Precision Industry Co., Ltd. | 26,127,120 | 101,359 | ||||||
Hexagon AB, Class B | 5,117,258 | 99,316 | ||||||
DeNA Co., Ltd. | 3,250,000 | 90,036 | ||||||
ZTE Corp., Class H | 31,460,000 | 84,671 | ||||||
MediaTek Inc. | 7,686,539 | 73,572 | ||||||
Ibiden Co., Ltd. | 2,695,200 | 68,935 | ||||||
Nippon Electric Glass Co., Ltd. | 6,750,000 | 58,635 | ||||||
STMicroelectronics NV | 6,659,948 | 54,422 | ||||||
Delta Electronics, Inc. | 14,278,563 | 41,847 | ||||||
TDK Corp. | 700,000 | 39,664 | ||||||
Keyence Corp. | 159,500 | 37,500 | ||||||
Rohm Co., Ltd. | 712,700 | 35,174 | ||||||
10,290,902 | ||||||||
INDUSTRIALS — 9.12% | ||||||||
Schneider Electric SA | 12,570,156 | 821,308 | ||||||
Atlas Copco AB, Class A | 17,000,330 | 411,402 | ||||||
Atlas Copco AB, Class B | 11,560,000 | 249,170 | ||||||
Ryanair Holdings PLC (ADR)1 | 17,233,200 | 625,220 | ||||||
European Aeronautic Defence and Space Co. EADS NV | 12,570,890 | 514,794 | ||||||
Siemens AG | 4,912,000 | 495,200 | ||||||
Komatsu Ltd. | 14,414,600 | 410,826 | ||||||
Legrand SA | 10,137,000 | 373,009 | ||||||
Kubota Corp. | 36,195,000 | 347,650 | ||||||
Capita Group PLC | 29,088,005 | 340,805 | ||||||
Experian PLC | 20,861,000 | 325,163 | ||||||
ASSA ABLOY AB, Class B | 8,878,000 | 278,855 | ||||||
Beijing Enterprises Holdings Ltd. | 44,996,000 | 274,360 | ||||||
AB Volvo, Class B | 18,000,000 | 262,281 | ||||||
Weir Group PLC | 8,789,000 | 247,983 | ||||||
Geberit AG | 1,055,000 | 220,770 | ||||||
FANUC CORP. | 1,151,000 | 204,140 | ||||||
Jardine Matheson Holdings Ltd. | 4,049,200 | 202,460 | ||||||
Meggitt PLC | 29,391,547 | 189,881 | ||||||
Marubeni Corp. | 25,800,000 | 186,089 | ||||||
Bureau Veritas SA | 1,807,181 | 159,076 | ||||||
KONE Oyj, Class B | 2,751,000 | 153,254 | ||||||
Aggreko PLC | 3,786,843 | 136,284 | ||||||
Hutchison Port Holdings Trust4 | 163,573,000 | 125,133 | ||||||
Vallourec SA | 1,944,000 | 123,154 | ||||||
ABB Ltd | 5,600,000 | 114,891 | ||||||
Wolseley PLC | 3,012,485 | 114,872 | ||||||
SMC Corp. | 715,700 | 113,793 | ||||||
Qantas Airways Ltd.1 | 60,015,070 | 110,967 | ||||||
Alstom SA | 2,738,000 | 106,848 | ||||||
ITOCHU Corp. | 9,500,000 | 103,643 | ||||||
BAE Systems PLC | 20,967,468 | 100,579 | ||||||
Nabtesco Corp. | 4,500,000 | 92,316 | ||||||
International Consolidated Airlines Group, SA (CDI) (GBP denominated)1 | 30,070,400 | 86,047 | ||||||
SGS SA | 38,834 | 75,543 | ||||||
Serco Group PLC | 8,330,000 | 72,282 | ||||||
Fiat Industrial SpA1 | 6,700,000 | 71,486 | ||||||
Adani Enterprises Ltd. | 11,882,694 | 71,105 | ||||||
A.P. Moller-Maersk A/S, Class B | 9,054 | 69,907 | ||||||
Makita Corp. | 1,429,200 | 57,327 | ||||||
Brambles Ltd. | 7,721,872 | 56,791 | ||||||
China Merchants Holdings (International) Co., Ltd. | 14,689,347 | 49,182 | ||||||
Air France1 | 8,160,720 | 46,366 | ||||||
Kühne + Nagel International AG | 330,000 | 44,636 | ||||||
9,236,848 | ||||||||
TELECOMMUNICATION SERVICES — 6.80% | ||||||||
América Móvil, SAB de CV, Series L (ADR) | 73,597,402 | 1,827,424 | ||||||
América Móvil, SAB de CV, Series L | 140,040,000 | 174,369 | ||||||
SOFTBANK CORP. | 45,607,900 | 1,348,345 | ||||||
MTN Group Ltd. | 36,324,200 | 639,355 | ||||||
Koninklijke KPN NV | 42,582,000 | 468,417 | ||||||
OJSC Mobile TeleSystems (ADR) | 23,149,100 | 424,555 | ||||||
Vodafone Group PLC | 139,344,919 | 383,803 | ||||||
TeliaSonera AB | 38,435,700 | 268,059 | ||||||
China Telecom Corp. Ltd., Class H | 420,844,000 | 233,033 | ||||||
Telefónica, SA | 13,214,000 | 216,505 | ||||||
Advanced Info Service PCL | 30,643,300 | 182,767 | ||||||
Bharti Airtel Ltd. | 19,740,000 | 130,928 | ||||||
Portugal Telecom, SGPS, SA | 23,045,000 | 125,369 | ||||||
Axiata Group Bhd. | 69,481,000 | 117,937 | ||||||
Millicom International Cellular SA (SDR) | 940,000 | 106,563 | ||||||
Iliad SA | 657,500 | 90,585 | ||||||
Telekomunikacja Polska SA | 15,001,227 | 82,470 | ||||||
Turkcell Iletisim Hizmetleri AS1 | 12,655,000 | 64,755 | ||||||
6,885,239 | ||||||||
MATERIALS — 6.43% | ||||||||
Syngenta AG | 1,892,815 | 654,423 | ||||||
Linde AG | 3,095,500 | 555,485 | ||||||
Holcim Ltd | 6,474,544 | 422,456 | ||||||
BASF SE | 3,610,000 | 315,793 | ||||||
Nitto Denko Corp. | 7,695,700 | 310,078 | ||||||
PT Semen Gresik (Persero) Tbk | 216,182,000 | 289,614 | ||||||
CRH PLC | 12,980,600 | 264,877 | ||||||
Amcor Ltd. | 33,954,916 | 261,681 | ||||||
POSCO | 775,000 | 259,918 | ||||||
UltraTech Cement Ltd. | 8,716,557 | 259,136 | ||||||
Orica Ltd. | 7,718,819 | 223,635 | ||||||
Potash Corp. of Saskatchewan Inc. | 4,670,000 | 213,372 | ||||||
Shin-Etsu Chemical Co., Ltd. | 3,610,000 | 208,479 | ||||||
ArcelorMittal | 10,572,736 | 202,065 | ||||||
Impala Platinum Holdings Ltd. | 10,240,488 | 201,713 | ||||||
Chr. Hansen Holding A/S | 6,901,000 | 178,601 | ||||||
First Quantum Minerals Ltd. | 8,490,500 | 161,902 | ||||||
Vedanta Resources PLC | 8,052,097 | 158,158 | ||||||
L’Air Liquide SA, bonus shares2 | 818,610 | 109,134 | ||||||
L’Air Liquide SA, non-registered shares | 236,456 | 31,524 | ||||||
Svenska Cellulosa AB SCA, Class B | 7,306,260 | 126,560 | ||||||
K+S AG | 2,213,000 | 115,772 | ||||||
JFE Holdings, Inc. | 5,164,000 | 110,929 | ||||||
Akzo Nobel NV | 1,790,000 | 105,687 | ||||||
Vale SA, ordinary nominative (ADR) | 4,000,000 | 93,320 | ||||||
BHP Billiton PLC | 3,000,000 | 91,531 | ||||||
Koninklijke DSM NV | 1,515,979 | 87,718 | ||||||
Anhui Conch Cement Co. Ltd., Class H | 25,010,000 | 79,228 | ||||||
Jindal Steel & Power Ltd. | 6,900,000 | 73,835 | ||||||
Barrick Gold Corp. | 1,570,000 | 68,264 | ||||||
Rio Tinto PLC | 1,200,000 | 66,143 | ||||||
Titan Cement Co. SA | 3,521,000 | 65,039 | ||||||
Grasim Industries Ltd. | 1,173,238 | 60,500 | ||||||
Formosa Chemicals & Fibre Corp. | 17,970,000 | 52,483 | ||||||
Givaudan SA | 34,832 | 33,570 | ||||||
6,512,623 | ||||||||
ENERGY — 6.40% | ||||||||
BP PLC | 123,652,164 | 914,839 | ||||||
Royal Dutch Shell PLC, Class B | 12,402,000 | 436,315 | ||||||
Royal Dutch Shell PLC, Class A | 3,195,000 | 111,856 | ||||||
Royal Dutch Shell PLC, Class B (ADR) | 1,292,999 | 91,325 | ||||||
Royal Dutch Shell PLC, Class A (ADR) | 1,000,000 | 70,130 | ||||||
OAO Gazprom (ADR) | 52,608,000 | 641,818 | ||||||
Canadian Natural Resources, Ltd. | 17,172,600 | 569,178 | ||||||
INPEX CORP. | 70,250 | 474,444 | ||||||
Nexen Inc. | 21,080,000 | 386,818 | ||||||
Saipem SpA, Class S | 6,731,566 | 347,714 | ||||||
TOTAL SA | 5,730,000 | 292,234 | ||||||
Crescent Point Energy Corp. | 6,205,000 | 267,124 | ||||||
Transocean Ltd. | 4,554,961 | 249,156 | ||||||
Cenovus Energy Inc. | 6,517,498 | 234,576 | ||||||
Cairn India Ltd.1 | 31,450,000 | 206,127 | ||||||
Petróleo Brasileiro SA – Petrobras, ordinary nominative (ADR) | 7,614,000 | 202,228 | ||||||
China National Offshore Oil Corp. | 78,800,100 | 161,953 | ||||||
Oil Search Ltd. | 19,000,000 | 137,177 | ||||||
KunLun Energy Co. Ltd. | 75,622,000 | 136,334 | ||||||
Suncor Energy Inc. | 2,944,000 | 96,190 | ||||||
Reliance Industries Ltd. | 6,455,000 | 95,105 | ||||||
BG Group PLC | 3,950,000 | 91,485 | ||||||
SeaDrill Ltd. | 2,249,343 | 84,290 | ||||||
PTT PCL | 5,600,000 | 64,259 | ||||||
Essar Energy PLC1 | 24,995,900 | 62,090 | ||||||
Eni SpA | 2,236,000 | 52,456 | ||||||
6,477,221 | ||||||||
UTILITIES — 1.97% | ||||||||
International Power PLC | 67,681,946 | 438,442 | ||||||
Power Assets Holdings Ltd. | 43,010,000 | 315,698 | ||||||
National Grid PLC | 30,990,000 | 312,529 | ||||||
Power Grid Corp. of India Ltd. | 144,130,336 | 305,971 | ||||||
Hong Kong and China Gas Co. Ltd. | 107,928,672 | 276,578 | ||||||
GDF SUEZ | 7,031,186 | 181,642 | ||||||
E.ON AG | 3,000,000 | 71,860 | ||||||
SSE PLC | 2,125,000 | 45,172 | ||||||
CEZ, a s | 817,000 | 35,101 | ||||||
SUEZ Environnement Co. | 521,250 | 7,995 | ||||||
1,990,988 | ||||||||
MISCELLANEOUS — 1.56% | ||||||||
Other common stocks in initial period of acquisition | 1,575,691 | |||||||
Total common stocks (cost: $69,736,900,000) | 94,006,496 | |||||||
Principal amount | ||||||||
Bonds & notes — 0.10% | (000 | ) | ||||||
BONDS & NOTES OF U.S. GOVERNMENT AGENCIES — 0.10% | ||||||||
Freddie Mac 1.25% 2012 | $ | 100,000 | 100,092 | |||||
Total bonds & notes (cost: $100,092,000) | 100,092 | |||||||
Short-term securities — 6.98% | ||||||||
Fannie Mae 0.07%–0.23% due 4/17/2012–1/9/2013 | 2,120,550 | 2,119,027 | ||||||
Freddie Mac 0.065%–0.16% due 4/2–11/2/2012 | 1,862,968 | 1,862,143 | ||||||
Federal Home Loan Bank 0.08%–0.25% due 4/25/2012–2/4/2013 | 1,176,976 | 1,176,491 | ||||||
U.S. Treasury Bills 0.072%–0.185% due 4/19–8/23/2012 | 787,375 | 787,173 | ||||||
Federal Farm Credit Banks 0.16%–0.26% due 4/4/2012–1/15/2013 | 240,000 | 239,870 | ||||||
Straight-A Funding LLC 0.15%–0.19% due 4/4–5/8/20124 | 163,300 | 163,289 | ||||||
Toronto-Dominion Holdings USA Inc. 0.13%–0.21% due 5/1–5/11/20124 | 135,000 | 134,981 | ||||||
Chariot Funding, LLC 0.25% due 6/7/20124 | 50,000 | 49,985 | ||||||
Jupiter Securitization Co., LLC 0.19% due 5/21/20124 | 50,000 | 49,981 | ||||||
Barclays U.S. Funding Corp. 0.10% due 4/2/2012 | 63,800 | 63,799 | ||||||
Pfizer Inc 0.10% due 4/19/20124 | 50,000 | 49,997 | ||||||
International Bank for Reconstruction and Development 0.10% due 5/18/2012 | 50,000 | 49,994 | ||||||
BHP Billiton Finance (USA) Limited 0.15% due 4/17/20124 | 50,000 | 49,991 | ||||||
Commonwealth Bank of Australia 0.19% due 6/5/20124 | 50,000 | 49,987 | ||||||
Private Export Funding Corp. 0.15% due 5/16/20124 | 50,000 | 49,984 | ||||||
Novartis Securities Investment Ltd. 0.11% due 4/12/20124 | 40,000 | 39,999 | ||||||
Variable Funding Capital Company LLC 0.12% due 4/10/20124 | 25,000 | 24,999 | ||||||
Svenska Handelsbanken Inc. 0.27% due 5/1/20124 | 25,000 | 24,995 | ||||||
Province of Ontario 0.14% due 5/15/2012 | 25,000 | 24,990 | ||||||
Coca-Cola Co. 0.15% due 6/5/20124 | 19,200 | 19,196 | ||||||
Bank of Nova Scotia 0.335% due 7/10/2012 | 15,200 | 15,193 | ||||||
Emerson Electric Co. 0.13% due 5/29/20124 | 14,300 | 14,298 | ||||||
Total short-term securities (cost: $7,060,382,000) | 7,060,362 | |||||||
Total investment securities (cost: $76,897,374,000) | 101,166,950 | |||||||
Other assets less liabilities | 53,325 | |||||||
Net assets | $ | 101,220,275 |
As permitted by U.S. Securities and Exchange Commission (SEC) regulations, “Miscellaneous” securities include holdings in their first year of acquisition that have not previously been publicly disclosed.
1Security did not produce income during the last 12 months.
2Valued under fair value procedures adopted by authority of the board of trustees. The total value of all such securities was $237,619,000, which represented .23% of the net assets of the fund.
3Represents an affiliated company as defined under the Investment Company Act of 1940.
4Acquired in a transaction exempt from registration under Rule 144A or section 4(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $846,815,000, which represented .84% of the net assets of the fund.
Key to abbreviations
ADR = American Depositary Receipts
CDI = CREST Depository Interest
FDR = Fiduciary Depositary Receipts
GDR = Global Depositary Receipts
SDR = Swedish Depositary Receipts
CAD = Canadian dollars
GBP = British pounds
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at 800/421-4225 or visit the American Funds website at americanfunds.com.
MFGEFP-916-0512O-S29454
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON INVESTMENT PORTFOLIO
To the Shareholders and Board of Trustees of
EuroPacific Growth Fund:
We have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the financial statements of EuroPacific Growth Fund (the “Fund”) as of March 31, 2012, and for the year then ended and have issued our report thereon dated May 9, 2012, which report and financial statements are included in Item 1 of this Certified Shareholder Report on Form N-CSR. Our audit also included the Fund’s investment portfolio (the “Schedule”) as of March 31, 2012, appearing in Item 6 of this Form N-CSR. This Schedule is the responsibility of the Fund’s management. Our responsibility is to express an opinion based on our audit. In our opinion, the Schedule referred to above, when considered in relation to the basic financial statements taken as a whole of the Fund referred to above, presents fairly, in all material respects, the information set forth therein.
DELOITTE & TOUCHE LLP
Costa Mesa, California
May 9, 2012
ITEM 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 8 – Portfolio Managers of Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 10 – Submission of Matters to a Vote of Security Holders
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of trustees since the Registrant last submitted a proxy statement to its shareholders. The procedures are as follows. The Registrant has a nominating and governance committee comprised solely of persons who are not considered ‘‘interested persons’’ of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the board’s composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full board of trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the board. Such suggestions must be sent in writing to the nominating and governance committee of the Registrant, c/o the Registrant’s Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the nominating and governance committee.
ITEM 11 – Controls and Procedures
(a) | The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule. |
(b) | There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
ITEM 12 – Exhibits
(a)(1) | The Code of Ethics that is the subject of the disclosure required by Item 2 is attached as an exhibit hereto. |
(a)(2) | The certifications required by Rule 30a-2 of the Investment Company Act of 1940 and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto. |
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.
EUROPACIFIC GROWTH FUND | |
By /s/ Gina H. Despres | |
Gina H. Despres, Vice Chairman and Principal Executive Officer | |
Date: May 31, 2012 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By /s/ Gina H. Despres |
Gina H. Despres, Vice Chairman and Principal Executive Officer |
Date: May 31, 2012 |
By /s/ Brian C. Janssen |
Brian C. Janssen, Treasurer and Principal Financial Officer |
Date: May 31, 2012 |