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 811-5349
Goldman Sachs Trust
(Exact name of registrant as specified in charter)
71 South Wacker Drive, Suite 500, Chicago, Illinois 60606
(Address of principal executive offices) (Zip code)
Peter V. Bonanno, Esq. | Copies to: | |
Goldman, Sachs & Co. | Jack Murphy, Esq. | |
One New York Plaza | Dechert | |
New York, New York 10004 | 1775 I Street, NW | |
Washington, DC 20006 | ||
(Name and address of agents for service) |
Registrant’s telephone number, including area code: (312) 655-4400
Date of fiscal year end: August 31
Date of reporting period: February 28, 2007
ITEM 1. | REPORTS TO STOCKHOLDERS. | |
The Semiannual Report to Stockholders is filed herewith. |
Goldman Sachs Funds
GROWTH EQUITY FUNDS | Semiannual Report February 28, 2007 |
Long-term capital growth potential from a diversified portfolio of equity investments. |
Goldman Sachs Growth Equity Funds
n | GOLDMAN SACHS CAPITAL GROWTH FUND | |
n | GOLDMAN SACHS STRATEGIC GROWTH FUND | |
n | GOLDMAN SACHS CONCENTRATED GROWTH FUND | |
n | GOLDMAN SACHS GROWTH OPPORTUNITIES FUND | |
n | GOLDMAN SACHS SMALL/MID CAP GROWTH FUND |
The Capital Growth Fund invests primarily in large-capitalization U.S. equity investments and is subject to market risk so that the value of the securities in which it invests may go up or down in response to the prospects of individual companies, particular industry sectors and/or general economic conditions. |
The Strategic Growth Fund invests primarily in large-capitalization U.S. equity investments and is subject to market risk so that the value of the securities in which it invests may go up or down in response to the prospects of individual companies, particular industry sectors and/or general economic conditions.
The Concentrated Growth Fund invests primarily in U.S. equity investments and is subject to market risk so that the value of the securities in which it invests may go up or down in response to the prospects of individual companies, particular industry sectors and/or general economic conditions. The Fund may invest in securities of any capitalization, including mid-cap and small-cap companies,which involve greater risks than those associated with larger, more established companies and may be subject to more abrupt or erratic price movements.
The Concentrated Growth Fund is “non-diversified” under the Investment Company Act of 1940 and may invest a large percentage of its assets in fewer issuers than “diversified“ mutual funds. Because of the smaller number of stocks generally held in the Fund’s portfolio, the Fund may be subject to greater risks than a more diversified fund. A change in the value of any single holding may affect the overall value of the portfolio more than it would affect a diversified fund that holds more investments.
The Growth Opportunities Fund invests in U.S. equity investments with a primary focus on mid-cap companies. The Fund is subject to market risk so that the value of the securities in which it invests may go up or down in response to the prospects of individual companies, particular industry sectors and/or general economic conditions. The securities of mid-capitalization companies involve greater risks than those associated with larger, more established companies and may be subject to more abrupt or erratic price movements.
The Goldman Sachs Small/Mid Cap Growth Fund invests in equity investments with a primary focus on small- and mid-cap companies. The securities of small- and mid-capitalization companies involve greater risks than those associated with larger, more established companies and may be subject to more abrupt or erratic price movements.
NOT FDIC-INSURED | May Lose Value | No Bank Guarantee | ||
GOLDMAN SACHS GROWTH EQUITY FUNDS
What Differentiates Goldman Sachs’
Growth Investment Process?
Growth Investment Process?
For over 26 years, the Goldman Sachs Growth Team has consistently applied a three-step investment process based on our belief that wealth is created through the long-term ownership of growing businesses.
Make decisions as long-term business owners rather than as stock traders Perform in-depth, fundamental research Focus on long-term structural and competitive advantages | Result Performance driven by the compounding growth of businesses over time — not short-term market movements Long-term participation in growing businesses — less reliance on macroeconomic predictions, market timing, sector rotation or momentum |
Identify high quality growth businesses. Some required investment criteria include: n Established brand names n Dominant market shares n Pricing power n Recurring revenue streams n Free cash flow n Long product life cycles n Favorable long-term growth prospects n Excellent management | Result Investment in businesses that we believe are strategically positioned for consistent, sustainable long-term growth |
n Perform rigorous valuation analysis of every potential investment n Use valuation tools and analytics to ensure that the high-quality business franchises we have identified also represent sound investments | Result Good investment decisions based on solid understanding of what each business is worth Attractive buying opportunities as the stock prices of quality growth businesses fluctuate over time |
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PORTFOLIO RESULTS
Capital Growth Fund
Dear Shareholder,
This report provides an overview on the performance of the Goldman Sachs Capital Growth Fund during the six-month reporting period that ended February 28, 2007.
Performance Review
Over the six-month period that ended February 28, 2007, the Fund’s Class A, B, C, Institutional and Service Shares generated cumulative total returns, without sales charges, of 7.86%, 7.36%, 7.42%, 8.05%, and 7.75%, respectively. These returns compare to the 9.54% cumulative total returns of the Fund’s benchmark, the Russell 1000 Growth Index (with dividends reinvested), over the same time period. | |
The Fund underperformed its benchmark during the six-month period. This was largely the result of weakness in some of the Fund’s Energy holdings. Conversely, the Fund’s Technology businesses enhanced the Fund’s results versus the benchmark. | |
Suncor Energy, Inc., Chesapeake Energy Corp., and Baker Hughes, Inc. detracted from performance as Energy was the weakest performing sector during the period. While many Energy companies experienced weakness due to the warm winter weather, Suncor was also negatively impacted by weak natural gas prices and higher maintenance, operating, and labor costs in its fiscal fourth quarter. On the positive side, Suncor reported strong 2006 earnings, driven by increased production and higher oil prices in 2006. While shares of Chesapeake were weak during the six-month period, the company reported fourth quarter earnings that beat analyst estimates. The company posted a 29% increase in fourth quarter revenue from the same period in the prior year, helped by higher selling prices for oil and natural gas. | |
Baker Hughes detracted from performance as the company reported earnings that fell below expectations. The company has been focusing on international growth and has been making strategic investments to grow this area of its business. The company has grown its market share in non-U.S. markets, more specifically Russia and the Middle East, by investing substantially in people. In 2006, Baker Hughes hired 5,500 new employees. We believe that the company’s weakness is short term in nature as it takes time to train new workers and costs temporarily increase as they are deployed. We continue to have conviction in Baker Hughes and believe once it is through the training process, its new employees will be revenue producers and its margins will likely improve. In addition, we believe Baker Hughes should benefit as it has a backlog in its tool business. Rig counts, the monthly census of active drilling rigs exploring for, or developing, oil or natural gas, are increasing and the search for new energy sources remains a driver of demand for oil well services and equipment. We believe that as energy sources become more difficult to find and continuous investments are exceedingly necessary to drive growth, Suncor, Chesapeake, and Baker Hughes should benefit. | |
While Amgen, Inc. announced a 19% rise in quarterly earnings over the previous year, the results fell just short of estimates and the stock sold off toward the end of January. Amgen’s core franchise, in which it has dominant market share, is to treat anemia due to complications of both kidney disease and chemotherapy. A lingering competitive threat in the chemotherapy market has been Roche’s CERA drug. The Food and Drug Administration (FDA) recently requested that Roche delay its drug launch for another |
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PORTFOLIO RESULTS
two years so testing can be conducted to address possible safety concerns. Investors have long feared that CERA represents a threat to Amgen’s products. However, we believe that if Roche’s drug eventually does come to market, the fact that it offers no real improvement on Amgen’s drug suggests that the competitive threat is minimal. | |
Shares of wireless tower company Crown Castle International Corp. were weak after the company announced its acquisition of Global Signal, Inc., a competitor in the industry. This led to concerns, as Global Signal’s growth is currently not as strong as Crown Castle’s. However, we believe that the acquisition will prove to be positive for Crown Castle. Crown Castle has superior systems and management and once the synergies are realized we believe that Global Signal’s growth could be at least as strong as Crown Castle’s. In our view, there is a great deal of potential upside to this acquisition that the market is not currently factoring into Crown Castle’s share price. | |
Within the Technology sector, Google, Inc., Yahoo!, Inc. and Research In Motion, Ltd. contributed to performance during the reporting period. Google’s upward trend continued during the period as it reported fiscal fourth quarter profits that nearly tripled and its shares reached record highs in mid-January. The Internet search market remains strong and the company further increased its market share of online advertising spending. Google’s technology for ranking search advertisements has enabled it to generate higher revenue per search than its competitors, in spite of their new efforts in this area. The company was also more aggressive in pushing Google Checkout, its online payment process service, and gained revenues from promotions. | |
Yahoo contributed to performance during the period as shares were up on the introduction of Project Panama, the company’s new search platform, comScore Networks, a company that measures Internet usage, reported an increase in Yahoo’s click-through-rate and shares of the company contributed to performance as a result of the successful launch. More specifically, the number of Internet search users who clicked on advertisements on Yahoo’s website increased by 5% in the first week after the system’s launch and 9% in the second week. The benefit to Yahoo is that each time a user clicks on a link, Yahoo gets paid by the advertiser associated with the link. We believe Project Panama will increase Yahoo’s revenue per search and continue to help it close the gap with Google. | |
Shares of Research In Motion contributed to performance as a result of continued subscriber growth as businesses advance the adoption of mobile email and introduce it more deeply within their organizations. In addition, the popular consumer-focused BlackBerry Pearl product is broadening the brand’s appeal into a larger potential market. Research In Motion also announced the release of a new BlackBerry device called the 8800 that features multiple carrier partners in the U.S. and Europe. We believe this should help the company further penetrate the corporate market. |
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PORTFOLIO RESULTS
Portfolio Composition
The Fund invests primarily in large-capitalization U.S. equity investments. Since the Fund’s inception, we have focused on several key investment criteria that we believe can drive a company’s growth over the long term. These characteristics are: dominant market share, established brand name, pricing power, recurring revenue stream, free cash flow, high returns on invested capital, predictable growth, sustainable growth, long product life cycle, enduring competitive advantage, favorable demographic trends and excellent management. We strive to purchase these companies at reasonable valuations in order to capture the full benefits of their growth. |
Portfolio Highlights
During the reporting period, there were a number of holdings that enhanced results, including the following: | |
n | Cisco Systems, Inc. — Cisco Systems was the top contributor to performance during the period as the company has seen growth in its business and telecommunication networks businesses. We remain positive about the company as it dominates the network equipment market and continues to expand its customer base and capabilities through acquisitions and strategic investments. |
n | Harrah’s Entertainment, Inc. — Harrah’s was a top contributor to performance during the six month period. Shares of Harrah’s were boosted significantly after the company received bids from private equity firms in October. We took the opportunity to exit our position as the market began to fully recognize the value of the business. This event demonstrates how adherence to our discipline regarding a high quality business recently out of favor, can benefit the portfolio when other market participants realize the company’s long term growth potential. |
n | Microsoft, Corp. — Microsoft contributed to performance as the company released its new operating system, Windows Vista. Shares of Microsoft were boosted after the company posted profits for its fiscal second quarter that beat analyst estimates and increased its earnings forecast for 2007. The positive results were driven by strong sales of the company’s Xbox gaming device. |
We thank you for your investment and look forward to your continued confidence. | |
Goldman Sachs Growth Equity Investment Team | |
New York, March 16, 2007 |
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FUND BASICS
Capital Growth Fund
as of February 28, 2007
PERFORMANCE REVIEW |
September 1, 2006–February 28, 2007 | Fund Total Return (based on NAV)1 | Russell 1000 Growth Index2 | ||||||||
Class A | 7.86 | % | 9.54 | % | ||||||
Class B | 7.36 | 9.54 | ||||||||
Class C | 7.42 | 9.54 | ||||||||
Institutional | 8.05 | 9.54 | ||||||||
Service | 7.75 | 9.54 | ||||||||
1 | The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. |
2 | The Russell 1000 Growth Index is an unmanaged index that measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any deduction for fees, expenses or taxes. It is not possible to invest directly in an unmanaged Index. |
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS3 |
For the period ended 12/31/06 | One Year | Five Years | Ten Years | Since Inception | Inception Date | |||||||||||||||
Class A | 2.21 | % | 1.09 | % | 6.65 | % | 10.18 | % | 4/20/90 | |||||||||||
Class B | 2.35 | 1.10 | 6.44 | 7.17 | 5/1/96 | |||||||||||||||
Class C | 6.36 | 1.47 | n/a | 4.30 | 8/15/97 | |||||||||||||||
Institutional | 8.62 | 2.66 | n/a | 5.48 | 8/15/97 | |||||||||||||||
Service | 8.07 | 2.14 | 7.15 | 4 | 10.49 | 4 | 4/20/90 | |||||||||||||
3 | The Standardized Total Returns are average annual total returns as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
4 | Performance data for Service Shares prior to August 15, 1997 (commencement of operations) is that of Class A Shares (excluding the impact of front-end sales charges applicable to Class A Shares since Service Shares are not subject to any sales charges). Performance of Class A Shares of the Capital Growth Fund reflects the expenses applicable to the Fund’s Class A Shares. The fees applicable to Service Shares are different from those applicable to Class A Shares which impact performance ratings and rankings for a class of shares. |
The returns represent past performance. Past performance does not guarantee future results. The Fund’s investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. Please visit our Web site at: www.goldmansachsfunds.com to obtain the most recent month-end returns. Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
EXPENSE RATIOS5 |
Current Expense Ratio | Expense Ratio Before Waivers | |||||||||
Class A | 1.39 | % | 1.44 | % | ||||||
Class B | 2.14 | 2.19 | ||||||||
Class C | 2.14 | 2.19 | ||||||||
Institutional | 0.99 | 1.04 | ||||||||
Service | 1.49 | 1.54 | ||||||||
5 | The expense ratios of the Fund, both with and without waivers and expense limitations, are as set forth above according to the most recent publicly available Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights. The waivers and expense limitations are voluntary and may be modified or terminated at any time at the option of the Investment Adviser. If this occurs, the expense ratios may change without shareholder approval. |
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FUND BASICS
TOP 10 HOLDINGS AS OF 2/28/076 |
Holding | % of Net Assets | Line of Business | ||||||
Microsoft Corp. | 3.9 | % | Computer Software | |||||
Google, Inc. | 3.9 | Internet & Online | ||||||
Freddie Mac | 3.5 | Specialty Finance | ||||||
Cisco Systems, Inc. | 3.0 | Networking/Telecommunications Equipment | ||||||
Yahoo!, Inc. | 3.0 | Internet & Online | ||||||
Suncor Energy, Inc. | 2.9 | Oil & Gas | ||||||
American Tower Corp. | 2.7 | Telecommunications | ||||||
Target Corp. | 2.4 | Retailing | ||||||
The McGraw-Hill Companies, Inc. | 2.4 | Commercial Services | ||||||
PepsiCo., Inc. | 2.4 | Beverages | ||||||
6 | The top 10 holdings may not be representative of the Fund’s future investments. |
SECTOR ALLOCATION7 |
Percentage of Net Assets
7 | The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. Short-term investments include repurchase agreements and securities lending collateral (if any). Figures in the above graph may not sum to 100% due to the exclusion of other assets and liabilities. |
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PORTFOLIO RESULTS |
Strategic Growth Fund
Dear Shareholder,
This report provides an overview on the performance of the Goldman Sachs Strategic Growth Fund during the six-month reporting period that ended February 28, 2007.
Performance Review
Over the six-month period that ended February 28, 2007, the Fund’s Class A, B, C, Institutional and Service Shares generated cumulative total returns, without sales charges, of 7.20%, 6.90%, 6.77%, 7.46%, and 7.17%, respectively. These returns compare to the 9.54% cumulative total return of the Fund’s benchmark, the Russell 1000 Growth Index (with dividends reinvested), over the same time period. | |
During the six-month period, the Fund generated positive absolute returns but underperformed its benchmark. This was largely due to several stocks that generated disappointing results. In particular, weakness in some of the Fund’s Energy and Finance businesses detracted from performance. In contrast, select holdings within the Technology and Healthcare sectors had strong performance and contributed to returns versus the benchmark. | |
Over the past six months, Baker Hughes, Inc. and Suncor Energy, Inc. detracted from performance as many Energy companies experienced weakness due to the warm winter weather. Suncor was also negatively impacted by weak natural gas prices and higher maintenance, operating, and labor costs in its fiscal fourth quarter. On the positive side, the company reported strong 2006 earnings driven by increased production and higher oil prices in 2006. Baker Hughes detracted from performance as the company reported earnings that fell below expectations. The company has been focusing on international growth and has been making strategic investments to grow this area of its business. The company has grown its market share in non-U.S. markets, more specifically Russia and the Middle East, by investing substantially in people. In 2006, Baker Hughes hired 5,500 new employees. We believe that the company’s weakness is short term in nature as it takes time to train new workers and costs temporarily increase as they are deployed. We continue to have conviction in Baker Hughes and believe once it is through the training process, its new employees will be revenue producers and its margins will likely improve. In addition, we believe Baker Hughes should benefit as it has a backlog in its tool business. Rig counts, the monthly census of active drilling rigs exploring for, or developing, oil or natural gas, are increasing and the search for new energy sources remains a driver of demand for oil well services and equipment. We believe that as energy sources become more difficult to find and continuous investments are exceedingly necessary to drive growth, Baker Hughes and Suncor should benefit. | |
While Amgen, Inc. announced a 19% rise in quarterly earnings over the previous year, the results fell just short of estimates and the stock sold off toward the end of January. Amgen’s core franchise, in which it has dominant market share, is to treat anemia due to complications of both kidney disease and chemotherapy. A lingering competitive threat in the chemotherapy market has been Roche’s CERA drug. The Food and Drug Administration (FDA) recently requested that Roche delay its drug launch for another two years so testing can be conducted to address possible safety concerns. Investors have long feared that CERA represents a threat to Amgen’s products. However, we believe that if |
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PORTFOLIO RESULTS
Roche’s drug eventually does come to market, the fact that it offers no real improvement on Amgen’s drug suggests that the competitive threat is minimal. Based on this analysis, we took the recent decline in its stock price as an opportunity to add to the position. | |
On the positive side within Healthcare, St. Jude Medical, Inc. reported better-than-expected fiscal fourth quarter earnings, driven by strength across all of its businesses. We believe the overall implantable cardioverter defibrillator (ICD) market is beginning to stabilize, if not strengthen. In addition, the company announced a new $1 billion share repurchase program, which it expects to complete in the first half of this year. In our view, growth should continue to materialize as St. Jude plans to launch 20 new ICD products in 2007. | |
Shares of wireless tower company Crown Castle International Corp. were weak after the company announced its acquisition of Global Signal, a competitor in the industry. This led to concerns, as Global Signal’s growth is currently not as strong as Crown Castle’s. However, we believe that the acquisition will prove to be positive for Crown Castle. Crown Castle has superior systems and management and once the synergies are realized we believe that Global Signal’s growth could be at least as strong as Crown Castle’s. In our view, there is a great deal of potential upside to this acquisition that the market is not currently factoring into Crown Castle’s share price. | |
Shares of Research In Motion contributed to performance as a result of continued subscriber growth as businesses advance the adoption of mobile email and introduce it more deeply within their organizations. In addition, the popular consumer-focused BlackBerry Pearl product is broadening the brand’s appeal into a larger potential market. Research In Motion also announced the release of a new BlackBerry device called the 8800 that features multiple carrier partners in the U.S. and Europe. We believe this should help the company further penetrate the corporate market. | |
The McGraw-Hill Companies, Inc. aided returns as the company reported higher fiscal third quarter earnings and boosted its 2006 revenue outlook during the reporting period. While the education market continued to experience weakness, management attributed the company’s strength to improved cost management and performance within its financial services segment, Standard & Poor’s. McGraw-Hill also announced that it expects to post double-digit earnings growth in 2007. We continue to favor the ratings agency and believe it has strong fundamentals which should enable it to sustain double-digit growth rates in the long term as global economic growth, the spread of capitalism, and a trend toward issuing debt instead of borrowing from banks supports the growth of financial assets and the need to rate them. |
Portfolio Composition
The Fund invests primarily in large-cap growth stocks. More specifically, we seek businesses with dominant market share, established brand name, pricing power, recurring revenue stream and free cash flow. Additionally, we seek companies with high returns on invested capital, predictable growth, sustainable growth, long product life cycle, enduring competitive advantage, favorable demographic trends and excellent management. The Fund is more selective and focused than many mutual funds and there are typically 50 to 70 holdings in the portfolio. |
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PORTFOLIO RESULTS
Portfolio Highlights
While the Fund underperformed its benchmark, there were a number of holdings that enhanced results during the reporting period, including the following: | |
n | Western Union Co. — Western Union contributed to performance after First Data spun off the company at the end of September. Strength of Western Union’s shares was driven by healthy transaction growth as well as price stability. We believe the political environment regarding the Mexican corridor is improving and management is taking aggressive measures on price and marketing to regain customer confidence. In addition, we believe Western Union has a large opportunity with its bank operation and the company acquired Pago Facil, the largest collector/processor of public cash payments in Argentina. Western Union gained 3,300 locations through the deal and plans to add bill payment and money transfer capabilities to its new entity. If management executes well, we believe Western Union has a very positive long-term growth outlook. |
n | Google, Inc. — Google’s upward trend continued during the period as it reported fiscal fourth quarter profits that nearly tripled and its shares reached record highs in mid-January. The Internet search market remains strong and the company further increased its market share of online advertising spending. Google’s technology for ranking search advertisements has enabled it to generate higher revenue per search than its competitors, in spite of its competitors’ new efforts in this area. The company was also more aggressive in pushing Google Checkout, its online payment process service, and gained revenues from promotions. We added to the Fund’s position to reflect our conviction in the company. |
n | Celgene Corp. — Celgene, a multinational biopharmaceutical company, reported strong fiscal third quarter earnings that beat consensus estimates during the six-month period. Its positive results were driven by an increase in royalty revenue as well as total revenue (up 89%) compared to the prior year. A rise in net sales of Celgene’s lead product, REVLIMID, also bolstered its performance. Celgene is a recent addition to the portfolio and meets our criteria for a high quality growth business as it has the best-in-class oral therapy for blood disease. The company has a competitive advantage as REVLIMID has the best overall profile to treat multiple myeloma, a form of cancer. We believe Celgene is well-positioned for future growth, as it has a broad portfolio of novel drug candidates in its pipeline. |
We thank you for your investment and look forward to your continued confidence. | |
Goldman Sachs Growth Equity Investment Team | |
New York, March 16, 2007 |
9
FUND BASICS
Strategic Growth Fund
as of February 28, 2007
PERFORMANCE REVIEW |
September 1, 2006–February 28, 2007 | Fund Total Return (based on NAV)1 | Russell 1000 Growth Index2 | ||||||||
Class A | 7.20 | % | 9.54 | % | ||||||
Class B | 6.90 | 9.54 | ||||||||
Class C | 6.77 | 9.54 | ||||||||
Institutional | 7.46 | 9.54 | ||||||||
Service | 7.17 | 9.54 | ||||||||
1 | The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. |
2 | The Russell 1000 Growth Index is an unmanaged market capitalization weighted index that measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any deduction for fees, expenses or taxes. It is not possible to invest directly in an unmanaged Index. |
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS3 |
For the period ended 12/31/06 | One Year | Five Years | Since Inception | Inception Date | ||||||||||||
Class A | 1.89 | % | -0.34 | % | -1.14 | % | 5/24/99 | |||||||||
Class B | 2.01 | -0.36 | -1.14 | 5/24/99 | ||||||||||||
Class C | 6.00 | 0.02 | -1.12 | 5/24/99 | ||||||||||||
Institutional | 8.39 | 1.20 | 0.01 | 5/24/99 | ||||||||||||
Service | 7.76 | 0.80 | -0.36 | 5/24/99 | ||||||||||||
3 | The Standardized Total Returns are average annual total returns as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
The returns represent past performance. Past performance does not guarantee future results. The Fund’s investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. Please visit our Web site at: www.goldmansachsfunds.com to obtain the most recent month-end returns. Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
EXPENSE RATIOS4 |
Current Expense Ratio | Expense Ratio Before Waivers | |||||||||
Class A | 1.44 | % | 1.56 | % | ||||||
Class B | 2.19 | 2.31 | ||||||||
Class C | 2.19 | 2.31 | ||||||||
Institutional | 1.04 | 1.16 | ||||||||
Service | 1.54 | 1.66 | ||||||||
4 | The expense ratios of the Fund, both with and without waivers and expense limitations, are as set forth above according to the most recent publicly available Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights. The waivers and expense limitations are voluntary and may be modified or terminated at any time at the option of the Investment Adviser. If this occurs, the expense ratios may change without shareholder approval. |
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FUND BASICS
TOP 10 HOLDINGS AS OF 2/28/075 |
Holding | % of Net Assets | Line of Business | ||||||
Schlumberger Ltd. | 4.0 | % | Oil Well Services & Equipment | |||||
The McGraw-Hill Companies, Inc. | 3.9 | Commercial Services | ||||||
Freddie Mac | 3.7 | Specialty Finance | ||||||
Google, Inc. | 3.5 | Internet & Online | ||||||
Baker Hughes, Inc. | 3.4 | Oil Well Services & Equipment | ||||||
Suncor Energy, Inc. | 3.3 | Oil & Gas | ||||||
Yahoo!, Inc. | 3.3 | Internet & Online | ||||||
Microsoft Corp. | 3.0 | Computer Software | ||||||
St. Jude Medical, Inc. | 3.0 | Medical Products | ||||||
QUALCOMM, Inc. | 2.8 | Semiconductors | ||||||
5 | The top 10 holdings may not be representative of the Fund’s future investments. |
SECTOR ALLOCATION6 |
Percentage of Net Assets
6 | The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. Short-term investments include repurchase agreements and securities lending collateral (if any). Figures in the above graph may not sum to 100% due to the exclusion of other assets and liabilities. |
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PORTFOLIO RESULTS
Concentrated Growth Fund
Dear Shareholder,
This report provides an overview on the performance of the Goldman Sachs Concentrated Growth Fund during the six-month reporting period that ended February 28, 2007.
Performance Review
Over the six-month period that ended February 28, 2007, the Fund’s Class A, B, C, Institutional and Service Shares generated cumulative total returns, without sales charges, of 8.42%, 8.04%, 7.97%, 8.62%, and 8.35%, respectively. These returns compare to the 9.54% cumulative total return of the Fund’s benchmark, the Russell 1000 Growth Index (with dividends reinvested), over the same time period. | |
During the six-month period, the Fund generated a positive return but it underperformed its benchmark. This was due, in part, to weakness in some of the Fund’s Energy and Finance businesses. Conversely, select holdings within the Technology and Healthcare sectors had strong results and enhanced the Fund’s returns versus the benchmark. | |
Over the past six months, Baker Hughes, Inc. and Suncor Energy, Inc. detracted from performance as many Energy companies experienced weakness due to the warm winter weather. Suncor was also negatively impacted by weak natural gas prices and higher maintenance, operating, and labor costs in its fiscal fourth quarter. On the positive side, the company reported strong 2006 earnings driven by increased production and higher oil prices in 2006. Baker Hughes detracted from performance as the company reported earnings that fell below expectations. The company has been focusing on international growth and has been making strategic investments to grow this area of its business. The company has grown its market share in non-U.S. markets, more specifically Russia and the Middle East, by investing substantially in people. In 2006, Baker Hughes hired 5,500 new employees. We believe that the company’s weakness is short term in nature as it takes time to train new workers and costs temporarily increase as they are deployed. We continue to have conviction in Baker Hughes and believe once it is through the training process, its new employees will be revenue producers and its margins will likely improve. In addition, we believe Baker Hughes should benefit as it has a backlog in its tool business. Rig counts, the monthly census of active drilling rigs exploring for, or developing, oil or natural gas, are increasing and the search for new energy sources remains a driver of demand for oil well services and equipment. We believe that as energy sources become more difficult to find and continuous investments are exceedingly necessary to drive growth, Baker Hughes and Suncor should benefit. | |
During the period, videogame publisher Electronic Arts detracted from performance as Sony released a disappointing sales report for its PlayStation 3 videogame console due to a supply shortage. Shares of Electronic Arts fell on the news. We believe this is a short-term issue and Electronic Arts is well positioned for future growth as demand for its Madden NFL 2007 videogame has been strong. It is believed to have the potential to be the biggest seller in the videogame industry in terms of units sold. We continue to have high conviction in Electronic Arts as it has a dominant market share in a rapidly growing industry. | |
Shares of Research In Motion contributed to performance as a result of continued subscriber growth as businesses advance the adoption of mobile email and introduce it more deeply within their organizations. In addition, the popular consumer-focused |
12
PORTFOLIO RESULTS
BlackBerry Pearl product is broadening the brand’s appeal into a larger potential market. Research In Motion also announced the release of a new BlackBerry device called the 8800 that features multiple carrier partners in the U.S. and Europe. We believe this should help the company further penetrate the corporate market. | |
The McGraw-Hill Companies, Inc. aided returns as the company reported higher fiscal third quarter earnings and boosted its 2006 revenue outlook during the semiannual period. While the education market continued to show weakness, management attributed the company’s strength to improved cost management and performance within its financial services segment, Standard & Poor’s. McGraw-Hill also announced that it expects to post double-digit earnings growth in 2007. We continue to favor the ratings agency and believe it has strong fundamentals which should enable it to sustain double-digit growth rates in the long term as global economic growth, the spread of capitalism, and a trend toward issuing debt instead of borrowing from banks supports the growth of financial assets and the need to rate them. | |
Harrah’s Entertainment, Inc. contributed to performance as it received bids from private equity firms in October, which drove its shares up significantly. The deal indicates private equity firms’ interest in the gaming sector. Shortly thereafter, Harrah’s accepted a $17.1 billion offer from Apollo Management and Texas Pacific Group in the fourth-largest private-equity buyout ever. We decided to exit the Fund’s position as the value of the business was beginning to be fully recognized by the market. This event demonstrates how the gap between the stock price and the intrinsic worth of a company can close quickly when other market participants realize the company’s long-term growth potential. |
Portfolio Composition
The Fund typically holds 30-40 high quality growth companies and tends to be more concentrated in individual holdings, industries, and sectors than the typical broadly diversified large-cap growth fund. |
Portfolio Highlights
There were a number of holdings that enhanced results during the reporting period, including the following: | |
n | Medco Health Solutions — Medco Health Solutions contributed to performance as the company reported strong fiscal fourth quarter earnings that exceeded analysts’ expectations. Shares of the company had their largest percentage increase in their history following this news. Medco also announced that it increased its share buyback program by $3 billion and raised guidance for 2007. Management attributed the positive results to the company’s disciplined execution, sound business strategy, and higher profit margins on generic drugs. The company has increased its sales of generic products in each of the past seven quarters and shows no signs of slowing down as more drugs continue to lose patent protection. We believe Medco is well positioned to gain market share as a result of the uncertainty surrounding the integration of rivals Caremark and CVS. A third of Caremark’s contracts are approaching expiration, which could provide an opportunity to increase Medco’s market share. In addition, we believe the company’s efforts to promote generic drugs, grow its mail |
13
PORTFOLIO RESULTS
order business, and improve services and programs for senior citizens should further drive growth and serve the interests of its clients and shareholders. | |
n | Western Union — Western Union contributed to performance after First Data spun off the company at the end of September. Strength of Western Union’s shares was driven by healthy transaction growth as well as price stability. We believe the political environment regarding the Mexican corridor is improving and management is taking aggressive measures on price and marketing to regain customer confidence. In addition, we believe Western Union has a large opportunity with its bank operation and the company acquired Pago Facil, the largest collector/processor of public cash payments in Argentina. Western Union gained 3,300 locations through the deal and plans to add bill payment and money transfer capabilities to its new entity. If management executes well, we believe Western Union has a very positive long-term growth outlook. |
n | Google, Inc. — Google’s upward trend continued during the period as it reported fiscal fourth quarter profits that nearly tripled and its shares reached record highs in mid-January. The Internet search market remains strong and the company further increased its market share of online advertising spending. Google’s technology for ranking search advertisements has enabled it to generate higher revenue per search than its competitors, in spite of their new efforts in this area. The company was also more aggressive in pushing Google Checkout, its online payment process service, and gained revenues from promotions. We added to the Fund’s position to reflect our conviction in the company. |
We thank you for your investment and look forward to your continued confidence. | |
Goldman Sachs Growth Equity Investment Team | |
New York, March 16, 2007 |
14
FUND BASICS
Concentrated Growth Fund
as of February 28, 2007
PERFORMANCE REVIEW |
September 1, 2006–February 28, 2007 | Fund Total Return (based on NAV)1 | Russell 1000 Growth Index2 | ||||||||
Class A | 8.42 | % | 9.54 | % | ||||||
Class B | 8.04 | 9.54 | ||||||||
Class C | 7.97 | 9.54 | ||||||||
Institutional | 8.62 | 9.54 | ||||||||
Service | 8.35 | 9.54 | ||||||||
1 | The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. |
2 | The Russell 1000 Growth Index (with dividends reinvested) is an unmanaged market capitalization weighted index that measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any deduction for fees, expenses or taxes. It is not possible to invest directly in an unmanaged Index. |
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS3 |
For the period ended 12/31/06 | One Year | Since Inception | Inception Date | |||||||||
Class A | 3.17 | % | 7.84 | % | 9/3/02 | |||||||
Class B | 3.11 | 8.06 | 9/3/02 | |||||||||
Class C | 7.36 | 8.41 | 9/3/02 | |||||||||
Institutional | 9.62 | 9.68 | 9/3/02 | |||||||||
Service | 9.11 | 9.22 | 9/3/02 | |||||||||
3 | The Standardized Total Returns are average annual total returns as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
The returns represent past performance. Past performance does not guarantee future results. The Fund’s investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. Please visit our Web site at: www.goldmansachsfunds.com to obtain the most recent month-end returns. Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
EXPENSE RATIOS4 |
Current Expense Ratio | Expense Ratio Before Waivers | |||||||||
Class A | 1.48 | % | 1.64 | % | ||||||
Class B | 2.23 | 2.39 | ||||||||
Class C | 2.23 | 2.39 | ||||||||
Institutional | 1.08 | 1.24 | ||||||||
Service | 1.58 | 1.74 | ||||||||
4 | The expense ratios of the Fund, both with and without waivers and expense limitations, are as set forth above according to the most recent publicly available Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights. The waivers and expense limitations are voluntary and may be modified or terminated at any time at the option of the Investment Adviser. If this occurs, the expense ratios may change without shareholder approval. |
15
FUND BASICS
TOP 10 HOLDINGS AS OF 2/28/075 |
Holding | % of Net Assets | Line of Business | ||||||
The McGraw-Hill Companies, Inc. | 5.6 | % | Commercial Services | |||||
Freddie Mac | 4.9 | Specialty Finance | ||||||
Schlumberger Ltd. | 4.1 | Oil Well Services & Equipment | ||||||
Google, Inc. | 4.0 | Internet & Online | ||||||
Yahoo!, Inc. | 3.7 | Internet & Online | ||||||
PepsiCo., Inc. | 3.6 | Beverages | ||||||
Suncor Energy, Inc. | 3.6 | Oil & Gas | ||||||
Medco Health Solutions, Inc. | 3.6 | Pharmacy Benefit Manager | ||||||
American Tower Corp. | 3.6 | Telecommunications | ||||||
Baker Hughes, Inc. | 3.5 | Oil Well Services & Equipment | ||||||
5 | The top 10 holdings may not be representative of the Fund’s future investments. |
SECTOR ALLOCATION6 |
Percentage of Net Assets
6 | The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. Short-term investments include repurchase agreements and securities lending collateral (if any). Figures in the above graph may not sum to 100% due to the exclusion of other assets and liabilities. |
16
PORTFOLIO RESULTS
Growth Opportunities Fund
Dear Shareholder,
This report provides an overview on the performance of the Goldman Sachs Growth Opportunities Fund during the six-month reporting period that ended February 28, 2007.
Performance Review
Over the six-month period that ended February 28, 2007, the Fund’s Class A, B, C, Institutional and Service Shares generated cumulative total returns, without sales charges, of 14.51%, 14.09%, 14.08%, 14.74% and 14.45%, respectively. These returns compare to the 13.12% cumulative total return of the Fund’s benchmark, the Russell Midcap Growth Index (with dividends reinvested), over the same time period. | |
The Fund outperformed its benchmark during the reporting period. This was largely due to the strength of its holdings in the Technology, Healthcare and Consumer Discretionary sectors versus the benchmark. Conversely, the Fund’s underweight in cyclicals and Financials detracted from results versus its benchmark. | |
Within the Consumer Discretionary sector, retail companies Coach, Inc., Harman International Industries, Inc., and Urban Outfitters, Inc. were top performers during the period. Coach, the largest U.S. luxury leather-goods maker, was up after it reported strong profits above analysts’ expectations and the company’s own guidance. Net sales rose as Coach experienced “rapid growth” in the premium handbag market. The company also raised its guidance for fiscal 2007. The ability of Coach to service customers across retail, wholesale and factory outlet channels has helped drive business opportunities, particularly as accessories continue to be a market share gaining segment in retail. Audio equipment and navigational systems maker Harman International was up after reporting that net income and profit rose, bolstered by good performance in automobile-related sales. Apparel retailer Urban Outfitters posted better-than-expected quarterly earnings and issued an upbeat forecast, sending its shares up for the period. The company cited an excellent response to its spring and summer product lines as a driver of the strong performance. | |
Within Technology, Research In Motion was a top contributor to results. Research In Motion contributed to performance as a result of continued subscriber growth as businesses advance the adoption of mobile email and introduce it more deeply within their organizations. In addition, the popular consumer-focused BlackBerry Pearl product is broadening the brand’s appeal into a larger potential market. Research In Motion also announced the release of a new BlackBerry device called the 8800 that features multiple carrier partners in the U.S. and Europe. We believe this should help the company further penetrate the corporate market. | |
On the downside in Technology, FormFactor, Inc. and Advanced Micro Devices, Inc. detracted from returns. Shares of FormFactor fell after the company announced that it expects to have slower fourth-quarter sales. We believe FormFactor is well positioned to benefit from the growing demand for smaller and faster electronic equipment. Shares of Advanced Micro Devices fell due to weak fourth quarter gross margin and operating income which were hit by significantly lower average sales prices, which largely offset a significant increase in unit sales. We sold our position in the stock due to our concern over its current price war with Intel and the negative impact that we believe this could have on the company’s pricing power. |
17
PORTFOLIO RESULTS
Within Healthcare, Celgene Corp. and Medco Health Solutions were top performers. Celgene, a multinational biopharmaceutical company, reported strong fiscal third quarter earnings that beat consensus estimates during the six-month period. Its positive results were driven by an increase in royalty revenue as well as total revenue (up 89%) compared to the prior year. A rise in net sales of Celgene’s lead product, REVLIMID, also bolstered its performance. Celgene is a recent addition to the portfolio and meets our criteria for a high quality growth business as it has the best-in-class oral therapy for blood disease. The company has a competitive advantage as REVLIMID has the best overall profile to treat multiple myeloma, a form of cancer. We believe Celgene is well-positioned for future growth, as it has a broad portfolio of novel drug candidates in its pipeline. | |
Although the Fund’s Financials and cyclical holdings had strong absolute returns, underweights in these top performing sectors detracted from relative performance. We have typically been underweight in cyclicals as many of those businesses do not meet our investment criteria for high-quality, sustainable growth companies. Although many cyclicals have had strong performance in the recent environment, we believe that these companies, which are very dependent on a strong economy for their growth, will not be able to sustain strong growth going forward as the economy moderates and profits decelerate. In that environment, we believe many cyclical companies, whose earnings and growth may have peaked, will underperform and high quality companies with sustainable growth will become favored by the market. For those reasons, we believe shareholders will benefit from the Fund’s underweight in cyclicals over the long term. Within Financials, the Fund was underweight in real estate investment trusts (REITs) and capital market companies, which were the top performing industries within the sector. |
Portfolio Composition
The Fund invests primarily in medium-sized growth companies with a market capitalization between $1 and $10 billion. Since the Fund’s inception, we have focused on several key investment criteria that we believe can drive a company’s growth over the long term. These characteristics are: dominant market share, established brand name, pricing power, recurring revenue stream, free cash flow, high returns on invested capital, predictable growth, sustainable growth, long product life cycle, enduring competitive advantage, favorable demographic trends and excellent management. We strive to purchase these companies at reasonable valuations in order to capture the full benefits of their growth. |
18
PORTFOLIO RESULTS
Portfolio Highlights
There were a number of holdings that enhanced the Fund’s results during the reporting period, including the following: | |
n | Tessera Technologies, Inc. — Tessera Technologies, a leading provider of miniaturization technologies for the electronics industry, continued to perform well as the company posted fourth-quarter results that exceeded analyst expectations. Shares of Tessera hit a 12-month high in February after the company reported a fourth-quarter profit that more than doubled. Our conviction in Tessera Technologies remains strong as the company’s products help meet the increasing demand for ultra thin electronics and the company continues to expand its technology offerings. |
n | Entravision Communications — Spanish language broadcaster, Entravision Communications, rose to a 52-week high in February. Entravision is benefiting from the superior growth of media spending in small to mid-size U.S. Hispanic markets, as Spanish-language radio is posting surprisingly strong growth. The company also announced that it would use some of the proceeds from a recent asset sale to buy back up to $100 million of the company’s stock. |
n | Medco Health Solutions — Medco Health Solutions contributed to performance as the company reported strong fiscal fourth quarter earnings that exceeded analysts’ expectations. Shares of the company had their largest percentage increase in their history following this news. Medco also announced that it increased its share buyback program by $3 billion and raised guidance for 2007. Management attributed the positive results to the company’s disciplined execution, sound business strategy, and higher profit margins on generic drugs. The company has increased its sales of generic products in each of the past seven quarters and shows no signs of slowing down as more drugs continue to lose patent protection. We believe Medco is well positioned to gain market share as a result of the uncertainty surrounding the integration of rivals Caremark and CVS. A third of Caremark’s contracts are approaching expiration, which could provide an opportunity to increase Medco’s market share. In addition, we believe the company’s efforts to promote generic drugs, grow its mail order business, and improve services and programs for seniors should further drive growth and serve the interests of its clients and shareholders. |
As always, we thank you for your investment and look forward to your continued confidence. | |
Goldman Sachs Growth Equity Investment Team | |
New York, March 16, 2007 |
19
FUND BASICS |
Growth Opportunities Fund
as of February 28, 2007
PERFORMANCE REVIEW |
September 1, 2006–February 28, 2007 | Fund Total Return (based on NAV)1 | Russell Midcap Growth Index2 | ||||||||
Class A | 14.51 | % | 13.12 | % | ||||||
Class B | 14.09 | 13.12 | ||||||||
Class C | 14.08 | 13.12 | ||||||||
Institutional | 14.74 | 13.12 | ||||||||
Service | 14.45 | 13.12 | ||||||||
1 | The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. |
2 | The Russell Midcap Growth Index is an unmanaged market capitalization weighted index that measures the performance of those Russell Midcap companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any deduction for fees, expenses or taxes. It is not possible to invest directly in an unmanaged Index. |
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS3 |
For the period ended 12/31/06 | One Year | Five Years | Since Inception | Inception Date | ||||||||||||
Class A | 0.32 | % | 3.20 | % | 12.10 | % | 5/24/99 | |||||||||
Class B | 0.03 | 3.20 | 12.18 | 5/24/99 | ||||||||||||
Class C | 4.24 | 3.59 | 12.09 | 5/24/99 | ||||||||||||
Institutional | 6.51 | 4.78 | 13.37 | 5/24/99 | ||||||||||||
Service | 6.00 | 4.26 | 12.80 | 5/24/99 | ||||||||||||
3 | The Standardized Total Returns are average annual total returns as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
The returns represent past performance. Past performance does not guarantee future results. The Fund’s investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. Please visit our Web site at: www.goldmansachsfunds.com to obtain the most recent month-end returns. Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
EXPENSE RATIOS4 |
Current Expense Ratio | Expense Ratio Before Waivers | |||||||||
Class A | 1.47 | % | 1.47 | % | ||||||
Class B | 2.22 | 2.22 | ||||||||
Class C | 2.22 | 2.22 | ||||||||
Institutional | 1.07 | 1.07 | ||||||||
Service | 1.57 | 1.57 | ||||||||
4 | The expense ratios of the Fund, both with and without waivers and expense limitations, are as set forth above according to the most recent publicly available Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights. The waivers and expense limitations are voluntary and may be modified or terminated at any time at the option of the Investment Adviser. If this occurs, the expense ratios may change without shareholder approval. |
20
FUND BASICS
TOP 10 HOLDINGS AS OF 2/28/075 |
Holding | % of Net Assets | Line of Business | ||||||
Cameron International Corp. | 2.7 | % | Oil Well Services & Equipment | |||||
Harman International Industries, Inc. | 2.5 | Audio & Visual Equipment | ||||||
Williams-Sonoma, Inc. | 2.5 | Retailing | ||||||
Alliant Techsystems, Inc. | 2.5 | Aerospace & Defense | ||||||
Smith International, Inc. | 2.4 | Oil Well Services & Equipment | ||||||
Amphenol Corp. | 2.3 | Other Technology | ||||||
CheckFree Corp. | 2.2 | Computer Services | ||||||
Tessera Technologies, Inc. | 2.2 | Semi Capital | ||||||
Rockwell Automation, Inc. | 2.2 | Manufacturing | ||||||
Weatherford International Ltd. | 2.2 | Oil Well Services & Equipment | ||||||
5 | The top 10 holdings may not be representative of the Fund’s future investments. |
SECTOR ALLOCATION6 |
Percentage of Net Assets
6 | The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. Short-term investments include repurchase agreements and securities lending collateral (if any). Figures in the above graph may not sum to 100% due to the exclusion of other assets and liabilities. |
21
PORTFOLIO RESULTS
Small/Mid Cap Growth Fund
Dear Shareholder,
This report provides an overview on the performance of the Goldman Sachs Small/ Mid Cap Growth Fund during the six-month reporting period that ended February 28, 2007.
Performance Review
Over the six-month period that ended February 28, 2007, the Fund’s Class A, B, C, Institutional and Service Shares generated cumulative total returns, without sales charges, of 16.31%, 15.92%, 15.92%, 16.57%, and 16.39%, respectively. These returns compare to the 13.22% cumulative total return of the Fund’s benchmark, the Russell 2500 Growth Index (with dividends reinvested), over the same time period. | |
The Fund outperformed its benchmark during the reporting period. This was largely due to the strength of the Fund’s holdings in the Consumer Discretionary, Technology and Healthcare sectors versus the benchmark. Conversely, the Fund’s underweight in cyclicals detracted from results versus the benchmark. | |
Within the Consumer Discretionary sector, Four Seasons and Urban Outfitters, Inc. were top performers during the period. Four Seasons rallied on the news that the company agreed to be taken private at a significant premium. We decided to sell the Fund’s position after the stock’s appreciation. Apparel retailer Urban Outfitters posted better-than-expected quarterly earnings and issued an upbeat forecast, sending its shares higher during the period. The company cited an excellent response to its spring and summer product lines as a driver of the strong performance. | |
Within the Technology sector, Dolby Labs, Inc. was a top contributor to performance. Dolby’s results were largely driven by the company’s better-than-expected fourth quarter earnings results as profits increased significantly bolstered by growing licensing deals for its audio technology. Dolby also reported strong growth in its core technologies in 2006 and issued a positive outlook for 2007. We believe that the company is a leader in a growing industry and has a strong brand name, which should help it continue to gain share and enter new markets. | |
On the downside in Technology, FormFactor, Inc. detracted from returns. Shares of FormFactor fell after the company, which makes semiconductor wafer probe cards, said it expects slower product transitions to hurt its fourth-quarter sales. We believe FormFactor is well positioned to benefit from the growing demand for smaller and faster electronic equipment. | |
Within Healthcare, Vanda Pharmaceutical, Inc., was a top performer. Shares of Vanda Pharmaceuticals moved sharply higher after the company reported that its experimental schizophrenia drug proved effective in a late-stage clinical trial, reviving hopes for a product many had thought would not be approved. | |
The Fund’s underweight in cyclicals, which was among the top performing sectors, detracted from relative performance. We have typically been underweight in cyclicals as many of those businesses do not meet our investment criteria for high-quality, sustainable growth companies. Although many cyclicals have had strong performance in the recent environment, we believe that these companies, which are very dependent on a strong economy for their growth, will not be able to sustain strong growth going forward as the economy moderates and profits decelerate. In that environment, we believe many cyclical |
22
PORTFOLIO RESULTS
companies, whose earnings and growth may have peaked, will underperform and high quality companies with sustainable growth will become favored by the market. For those reasons, we believe shareholders will benefit from the Fund’s underweight in cyclicals over the long term. |
Portfolio Composition
The Fund invests, under normal circumstances, at least 80% of its net assets in a diversified portfolio of equity investments in small- and mid-sized companies with market capitalizations within the range of the Russell 2500 Growth Index at the time of investment. If the market capitalization of a company held by the Fund moves outside this range, the Fund may, but is not required to, sell the security. |
Portfolio Highlights
During the reporting period, there were a number of holdings that enhanced results, including the following: | |
n | Tessera Technologies, Inc. — Tessera Technologies, a leading provider of miniaturization technologies for the electronics industry, continued to perform well as the company posted fourth-quarter results that beat analyst expectations. Shares of Tessera hit a 12-month high in February after the company reported a fourth-quarter profit that more than doubled. Our conviction in Tessera Technologies remains strong as the company’s products help meet the increasing demand for ultra thin electronics and the company continues to expand its technology offerings. |
n | Entravision Communications — Spanish language broadcaster, Entravision Communications, rose to a 52-week high in February. Entravision is benefiting from the superior growth of media spending in small to mid-size U.S. Hispanic markets, as Spanish-language radio is posting surprisingly strong growth. The company also announced that it would use some of the proceeds from a recent asset sale to buy back up to $100 million of the company’s stock. |
n | Harman International Industries, Inc. — Harman International Industries, an audio equipment and navigational systems maker, enhanced results during the reporting period. Its shares rose after reporting that net income and profit rose, bolstered by good performance in automobile-related sales. |
We appreciate your investment and look forward to earning your continued confidence in the years to come. | |
Goldman Sachs Growth Equity Investment Team | |
New York, March 16, 2007 |
23
FUND BASICS |
Small/Mid Cap Growth Fund
as of February 28, 2007
PERFORMANCE REVIEW |
September 1, 2006–February 28, 2007 | Fund Total Return (based on NAV)1 | Russell 2500 Growth Index2 | ||||||||
Class A | 16.31 | % | 13.22 | % | ||||||
Class B | 15.92 | 13.22 | ||||||||
Class C | 15.92 | 13.22 | ||||||||
Institutional | 16.57 | 13.22 | ||||||||
Service | 16.39 | 13.22 | �� | |||||||
1 | The net asset value (NAV) represents the net assets of the class of the Fund (ex-dividend) divided by the total number of shares of the class outstanding. The Fund’s performance reflects the reinvestment of dividends and other distributions. The Fund’s performance does not reflect the deduction of any applicable sales charges. |
2 | The Russell 2500 Growth Index offers investors access to the small to mid cap growth segment of the US equity universe. The Russell 2500 Growth Index is constructed to provide a comprehensive and unbiased barometer of the small to mid cap growth market. Based on ongoing empirical research of investment manager behavior, the methodology used to determine growth probability approximates the aggregate small to mid cap growth manager’s opportunity set. The Index figures do not reflect any deduction for fees, expenses or taxes. It is not possible to invest directly in an unmanaged Index. |
STANDARDIZED AVERAGE ANNUAL TOTAL RETURNS3 |
For the period ended 12/31/06 | One Year | Since Inception | Inception Date | |||||||||
Class A | 6.51 | % | 8.13 | % | 6/30/05 | |||||||
Class B | 6.85 | 8.62 | 6/30/05 | |||||||||
Class C | 10.85 | 11.17 | 6/30/05 | |||||||||
Institutional | 13.12 | 12.45 | 6/30/05 | |||||||||
Service | 12.48 | 11.87 | 6/30/05 | |||||||||
3 | The Standardized Total Returns are average annual total returns as of the most recent calendar quarter-end. They assume reinvestment of all distributions at NAV. These returns reflect a maximum initial sales charge of 5.5% for Class A Shares, the assumed contingent deferred sales charge for Class B Shares (5% maximum declining to 0% after six years) and the assumed contingent deferred sales charge for Class C Shares (1% if redeemed within 12 months of purchase). Because Institutional and Service Shares do not involve a sales charge, such a charge is not applied to their Standardized Total Returns. |
The returns represent past performance. Past performance does not guarantee future results. The Fund’s investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. Please visit our Web site at: www.goldmansachsfunds.com to obtain the most recent month-end returns. Performance reflects expense limitations in effect. In their absence, performance would be reduced. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
EXPENSE RATIOS4 |
Current Expense Ratio | Expense Ratio Before Waivers | |||||||||
Class A | 1.50 | % | 2.05 | % | ||||||
Class B | 2.25 | 2.80 | ||||||||
Class C | 2.25 | 2.80 | ||||||||
Institutional | 1.10 | 1.65 | ||||||||
Service | 1.60 | 2.15 | ||||||||
4 | The expense ratios of the Fund, both with and without waivers and expense limitations, are as set forth above according to the most recent publicly available Prospectus for the Fund and may differ from the expense ratios disclosed in the Financial Highlights. The waivers and expense limitations are voluntary and may be modified or terminated at any time at the option of the Investment Adviser. If this occurs, the expense ratios may change without shareholder approval. |
24
FUND BASICS
TOP 10 HOLDINGS AS OF 2/28/075 |
Holding | % of Net Assets | Line of Business | ||||||
Tessera Technologies, Inc. | 2.7 | % | Semi Capital | |||||
Activision, Inc. | 1.9 | Computer Software | ||||||
FormFactor, Inc. | 1.8 | Semi Capital | ||||||
Harman International Industries | 1.8 | Audio & Visual Equipment | ||||||
Psychiatric Solutions, Inc. | 1.8 | Hospitals & Related | ||||||
Entravision Communications Corp. | 1.7 | Broadcasting & Cable/Satellite TV | ||||||
Cameron International Corp. | 1.7 | Oil Well Services & Equipment | ||||||
W.W. Grainger, Inc. | 1.6 | Producer Goods | ||||||
Williams-Sonoma, Inc. | 1.6 | Retailing | ||||||
Ritchie Bros. Auctioneers, Inc. | 1.5 | Consumer Services | ||||||
5 | The top 10 holdings may not be representative of the Fund’s future investments. |
SECTOR ALLOCATION6 |
Percentage of Net Assets
6 | The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. Short-term investments include repurchase agreements and securities lending collateral (if any). Figures in the above graph may not sum to 100% due to the exclusion of other assets and liabilities. |
25
FUND BASICS
GOLDMAN SACHS CAPITAL GROWTH FUND
Schedule of Investments
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Common Stocks – 99.1% | ||||||||||
Aerospace & Defense – 1.6% | ||||||||||
440,281 | United Technologies Corp. | $ | 28,895,642 | |||||||
Apparel/Shoes – 0.4% | ||||||||||
344,300 | Chico’s FAS, Inc.*(a) | 7,722,649 | ||||||||
Audio & Visual Equipment – 1.1% | ||||||||||
201,130 | Harman International Industries, Inc. | 19,944,051 | ||||||||
Banks – 1.0% | ||||||||||
214,853 | SunTrust Banks, Inc. | 18,114,256 | ||||||||
Beverages – 4.3% | ||||||||||
417,050 | Fortune Brands, Inc. | 33,530,820 | ||||||||
671,550 | PepsiCo., Inc. | 42,408,383 | ||||||||
75,939,203 | ||||||||||
Biotechnology – 8.1% | ||||||||||
609,300 | Amgen, Inc.*(a) | 39,153,618 | ||||||||
718,059 | Celgene Corp.* | 38,272,545 | ||||||||
437,600 | Genentech, Inc.* | 36,920,312 | ||||||||
897,274 | MedImmune, Inc.* | 28,632,013 | ||||||||
142,978,488 | ||||||||||
Commercial Services – 3.7% | ||||||||||
354,831 | Moody’s Corp.(a) | 22,964,662 | ||||||||
662,172 | The McGraw-Hill Companies, Inc. | 42,782,933 | ||||||||
65,747,595 | ||||||||||
Computer Hardware – 1.8% | ||||||||||
1,534,500 | EMC Corp.* | 21,406,275 | ||||||||
365,800 | Jabil Circuit, Inc. | 9,774,176 | ||||||||
31,180,451 | ||||||||||
Computer Services – 3.7% | ||||||||||
198,500 | CheckFree Corp.*(a) | 7,527,120 | ||||||||
1,091,920 | First Data Corp.(a) | 27,876,718 | ||||||||
1,331,970 | Western Union Co. | 28,863,790 | ||||||||
64,267,628 | ||||||||||
Computer Software – 5.7% | ||||||||||
627,980 | Electronic Arts, Inc.* | 31,662,752 | ||||||||
2,468,100 | Microsoft Corp. | 69,526,377 | ||||||||
101,189,129 | ||||||||||
Drugs & Medicine – 0.8% | ||||||||||
291,700 | Wyeth | 14,269,964 | ||||||||
Financials – 4.9% | ||||||||||
35,500 | Chicago Mercantile Exchange Holdings, Inc. | 19,139,115 | ||||||||
163,700 | Legg Mason, Inc. | 16,818,538 | ||||||||
150,000 | Merrill Lynch & Co., Inc. | 12,552,000 | ||||||||
167,700 | Morgan Stanley | 12,564,084 | ||||||||
1,369,900 | The Charles Schwab Corp.(a) | 25,315,752 | ||||||||
86,389,489 | ||||||||||
Household/Personal Care – 0.8% | ||||||||||
466,840 | Newell Rubbermaid, Inc. | 14,294,641 | ||||||||
Internet & Online – 6.9% | ||||||||||
154,608 | Google, Inc.* | 69,488,566 | ||||||||
1,708,989 | Yahoo!, Inc.* | 52,739,400 | ||||||||
122,227,966 | ||||||||||
Manufacturing – 1.4% | ||||||||||
408,700 | Rockwell Automation, Inc. | 25,376,183 | ||||||||
Medical Products – 4.6% | ||||||||||
185,800 | Baxter International, Inc. | 9,291,858 | ||||||||
642,300 | Medtronic, Inc. | 32,346,228 | ||||||||
473,768 | St. Jude Medical, Inc.* | 18,784,901 | ||||||||
435,560 | Thermo Fisher Scientific, Inc.* | 19,717,801 | ||||||||
80,140,788 | ||||||||||
Medical Supplies – 0.6% | ||||||||||
209,476 | Charles River Laboratories International, Inc.* | 9,604,475 | ||||||||
Movies & Entertainment – 1.0% | ||||||||||
427,165 | Viacom, Inc. Class B* | 16,676,522 | ||||||||
Networking/Telecommunications Equipment – 4.2% | ||||||||||
2,041,075 | Cisco Systems, Inc.* | 52,945,485 | ||||||||
149,744 | Research In Motion Ltd.* | 21,055,504 | ||||||||
74,000,989 | ||||||||||
Oil & Gas – 6.9% | ||||||||||
803,910 | Canadian Natural Resources Ltd. | 40,436,673 | ||||||||
635,300 | Chesapeake Energy Corp.(a) | 19,370,297 | ||||||||
290,400 | Quicksilver Resources, Inc.*(a) | 11,200,728 | ||||||||
723,110 | Suncor Energy, Inc. | 51,434,814 | ||||||||
122,442,512 | ||||||||||
Oil Well Services & Equipment – 6.0% | ||||||||||
622,510 | Baker Hughes, Inc. | 40,531,626 | ||||||||
208,500 | Grant Prideco, Inc.* | 9,050,985 | ||||||||
659,048 | Schlumberger Ltd. | 41,388,214 | ||||||||
378,200 | Weatherford International Ltd.* | 15,184,730 | ||||||||
106,155,555 | ||||||||||
Pharmacy Benefit Manager – 1.8% | ||||||||||
462,733 | Medco Health Solutions, Inc.* | 31,285,378 | ||||||||
Producer Goods – 0.8% | ||||||||||
181,070 | W.W. Grainger, Inc. | 13,969,551 | ||||||||
Publishing – 1.6% | ||||||||||
203,812 | Lamar Advertising Co.*(a) | 13,054,159 | ||||||||
543,455 | National CineMedia, Inc.*(a) | 14,249,390 | ||||||||
27,303,549 | ||||||||||
Retailing – 9.0% | ||||||||||
163,100 | J.C. Penney Co., Inc. | 13,229,041 | ||||||||
1,153,300 | Lowe’s Companies, Inc. | 37,551,448 | ||||||||
695,500 | Target Corp. | 42,794,115 | ||||||||
430,600 | The Home Depot, Inc. | 17,051,760 |
The accompanying notes are an integral part of these financial statements.
26
GOLDMAN SACHS CAPITAL GROWTH FUND
Shares | Description | Value | ||||||||
Common Stocks – (continued) | ||||||||||
Retailing – (continued) | ||||||||||
833,170 | Wal-Mart Stores, Inc. | $ | 40,242,111 | |||||||
255,800 | Williams-Sonoma, Inc.(a) | 8,635,808 | ||||||||
159,504,283 | ||||||||||
Semiconductors – 4.2% | ||||||||||
1,093,648 | Linear Technology Corp. | 36,298,177 | ||||||||
948,690 | QUALCOMM, Inc. | 38,213,233 | ||||||||
74,511,410 | ||||||||||
Specialty Finance – 6.1% | ||||||||||
479,530 | American Express Co. | 27,270,871 | ||||||||
340,143 | Fannie Mae | 19,296,312 | ||||||||
953,700 | Freddie Mac(a) | 61,208,466 | ||||||||
107,775,649 | ||||||||||
Technology Services – 0.9% | ||||||||||
170,840 | Cognizant Technology Solutions Corp.* | 15,409,768 | ||||||||
Telecommunications – 5.2% | ||||||||||
1,219,800 | American Tower Corp.* | 47,255,052 | ||||||||
321,865 | Crown Castle International Corp.* | 10,544,297 | ||||||||
339,610 | NeuStar, Inc.* | 10,867,520 | ||||||||
1,163,227 | Sprint Nextel Corp. | 22,427,017 | ||||||||
91,093,886 | ||||||||||
TOTAL COMMON STOCKS | ||||||||||
(Cost $1,362,846,128) | $ | 1,748,411,650 | ||||||||
Principal | Interest | Maturity | ||||||||||||||
Amount | Rate | Date | Value | |||||||||||||
Repurchase Agreement(b) – 1.0% | ||||||||||||||||
Joint Repurchase Agreement Account II | ||||||||||||||||
$ | 18,100,000 | 5.335 | % | 03/01/07 | $ | 18,100,000 | ||||||||||
Maturity Value: $18,102,682 | ||||||||||||||||
(Cost $18,100,000) | ||||||||||||||||
TOTAL INVESTMENTS BEFORE SECURITIES LENDING COLLATERAL | ||||||||||||||||
(Cost $1,380,946,128) | $ | 1,766,511,650 | ||||||||||||||
Shares | Description | Value | ||||||||
Securities Lending Collateral – 6.3% | ||||||||||
111,335,150 | Boston Global Investment Trust – Enhanced Portfolio | |||||||||
(Cost $111,335,150) | $ | 111,335,150 | ||||||||
TOTAL INVESTMENTS — 106.4% | ||||||||||
(Cost $1,492,281,278) | $ | 1,877,846,800 | ||||||||
LIABILITIES IN EXCESS OF OTHER ASSETS — (6.4)% | (113,520,805 | ) | ||||||||
NET ASSETS — 100.0% | $ | 1,764,325,995 | ||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. |
(a) | All or a portion of security is on loan. |
(b) | Joint repurchase agreement was entered into on February 28, 2007. Additional information appears on page 37. |
The accompanying notes are an integral part of these financial statements.
27
GOLDMAN SACHS STRATEGIC GROWTH FUND
Schedule of Investments
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Common Stocks – 99.2% | ||||||||||
Aerospace & Defense – 1.3% | ||||||||||
61,930 | United Technologies Corp. | $ | 4,064,466 | |||||||
Banks – 1.5% | ||||||||||
52,250 | SunTrust Banks, Inc. | 4,405,198 | ||||||||
Beverages – 4.4% | ||||||||||
74,360 | Fortune Brands, Inc. | 5,978,544 | ||||||||
117,690 | PepsiCo., Inc. | 7,432,124 | ||||||||
13,410,668 | ||||||||||
Biotechnology – 7.5% | ||||||||||
105,870 | Amgen, Inc.* | 6,803,206 | ||||||||
98,390 | Celgene Corp.* | 5,244,187 | ||||||||
52,090 | Genentech, Inc.* | 4,394,834 | ||||||||
197,320 | MedImmune, Inc.* | 6,296,481 | ||||||||
22,738,708 | ||||||||||
Commercial Services – 3.9% | ||||||||||
185,348 | The McGraw-Hill Companies, Inc. | 11,975,334 | ||||||||
Computer Hardware – 2.0% | ||||||||||
108,730 | Dell, Inc.* | 2,484,481 | ||||||||
255,690 | EMC Corp.* | 3,566,875 | ||||||||
6,051,356 | ||||||||||
Computer Services – 4.4% | ||||||||||
261,680 | First Data Corp. | 6,680,690 | ||||||||
315,330 | Western Union Co. | 6,833,201 | ||||||||
13,513,891 | ||||||||||
Computer Software – 5.2% | ||||||||||
129,730 | Electronic Arts, Inc.* | 6,540,987 | ||||||||
329,280 | Microsoft Corp. | 9,275,817 | ||||||||
15,816,804 | ||||||||||
Drugs & Medicine – 0.9% | ||||||||||
55,810 | Wyeth | 2,730,225 | ||||||||
Financials – 4.6% | ||||||||||
65,150 | Legg Mason, Inc. | 6,693,511 | ||||||||
386,490 | The Charles Schwab Corp. | 7,142,335 | ||||||||
13,835,846 | ||||||||||
Foods – 1.1% | ||||||||||
69,697 | Wm. Wrigley Jr. Co.(a) | 3,470,911 | ||||||||
Internet & Online – 6.8% | ||||||||||
23,730 | Google, Inc.* | 10,665,448 | ||||||||
323,680 | Yahoo!, Inc.* | 9,988,765 | ||||||||
20,654,213 | ||||||||||
Medical Products – 9.5% | ||||||||||
148,491 | Medtronic, Inc. | 7,478,007 | ||||||||
230,750 | St. Jude Medical, Inc.* | 9,149,237 | ||||||||
53,480 | Stryker Corp. | 3,316,830 | ||||||||
129,230 | Thermo Fisher Scientific, Inc.* | $ | 5,850,242 | |||||||
38,110 | Zimmer Holdings, Inc.* | 3,213,816 | ||||||||
29,008,132 | ||||||||||
Movies & Entertainment – 1.4% | ||||||||||
109,777 | Viacom, Inc. Class B* | 4,285,694 | ||||||||
Networking/Telecommunications Equipment – 4.8% | ||||||||||
289,840 | Cisco Systems, Inc.* | 7,518,450 | ||||||||
49,520 | Research In Motion Ltd.* | 6,963,007 | ||||||||
14,481,457 | ||||||||||
Oil & Gas – 3.3% | ||||||||||
142,210 | Suncor Energy, Inc. | 10,115,397 | ||||||||
Oil Well Services & Equipment – 8.2% | ||||||||||
160,810 | Baker Hughes, Inc. | 10,470,339 | ||||||||
195,420 | Schlumberger Ltd. | 12,272,376 | ||||||||
58,370 | Weatherford International Ltd.* | 2,343,556 | ||||||||
25,086,271 | ||||||||||
Pharmacy Benefit Manager – 1.8% | ||||||||||
80,570 | Medco Health Solutions, Inc.* | 5,447,338 | ||||||||
Publishing – 0.7% | ||||||||||
35,120 | Lamar Advertising Co.* | 2,249,436 | ||||||||
Retailing – 10.0% | ||||||||||
238,220 | Lowe’s Companies, Inc. | 7,756,443 | ||||||||
128,850 | Target Corp. | 7,928,141 | ||||||||
96,400 | The Home Depot, Inc. | 3,817,440 | ||||||||
161,780 | Wal-Mart Stores, Inc. | 7,813,974 | ||||||||
89,640 | Williams-Sonoma, Inc.(a) | 3,026,246 | ||||||||
30,342,244 | ||||||||||
Semiconductors – 4.6% | ||||||||||
163,380 | Linear Technology Corp. | 5,422,582 | ||||||||
213,260 | QUALCOMM, Inc. | 8,590,113 | ||||||||
14,012,695 | ||||||||||
Specialty Finance – 5.5% | ||||||||||
93,200 | American Express Co. | 5,300,284 | ||||||||
176,280 | Freddie Mac | 11,313,650 | ||||||||
16,613,934 | ||||||||||
Telecommunications – 5.8% | ||||||||||
124,930 | American Tower Corp.* | 4,839,788 | ||||||||
177,220 | Crown Castle International Corp.* | 5,805,727 | ||||||||
370,470 | Sprint Nextel Corp. | 7,142,662 | ||||||||
17,788,177 | ||||||||||
TOTAL INVESTMENTS BEFORE SECURITIES LENDING COLLATERAL | ||||||||||
(Cost $251,165,790) | $ | 302,098,395 | ||||||||
The accompanying notes are an integral part of these financial statements.
28
GOLDMAN SACHS STRATEGIC GROWTH FUND
Shares | Description | Value | ||||||||
Securities Lending Collateral – 0.7% | ||||||||||
2,225,900 | Boston Global Investment Trust – Enhanced Portfolio | |||||||||
(Cost $2,225,900) | $ | 2,225,900 | ||||||||
TOTAL INVESTMENTS – 99.9% | ||||||||||
(Cost $253,391,690) | $ | 304,324,295 | ||||||||
OTHER ASSETS IN EXCESS OF LIABILITIES – 0.1% | 352,316 | |||||||||
NET ASSETS – 100.0% | $ | 304,676,611 | ||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. |
(a) | All or a portion of security is on loan. |
The accompanying notes are an integral part of these financial statements.
29
GOLDMAN SACHS CONCENTRATED GROWTH FUND
Schedule of Investments
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Common Stocks – 99.2% | ||||||||||
Aerospace & Defense – 1.7% | ||||||||||
55,220 | United Technologies Corp. | $ | 3,624,089 | |||||||
Beverages – 3.6% | ||||||||||
125,490 | PepsiCo., Inc. | 7,924,693 | ||||||||
Biotechnology – 6.0% | ||||||||||
57,490 | Amgen, Inc.* | 3,694,308 | ||||||||
80,120 | Celgene Corp.* | 4,270,396 | ||||||||
158,520 | MedImmune, Inc.* | 5,058,373 | ||||||||
13,023,077 | ||||||||||
Broadcasting & Cable/Satellite TV – 0.5% | ||||||||||
74,430 | XM Satellite Radio Holdings, Inc.*(a) | 1,068,815 | ||||||||
Commercial Services – 5.6% | ||||||||||
190,180 | The McGraw-Hill Companies, Inc. | 12,287,530 | ||||||||
Computer Services – 7.6% | ||||||||||
107,300 | CheckFree Corp.* | 4,068,816 | ||||||||
245,260 | First Data Corp. | 6,261,488 | ||||||||
284,890 | Western Union Co. | 6,173,566 | ||||||||
16,503,870 | ||||||||||
Computer Software – 6.6% | ||||||||||
144,140 | Electronic Arts, Inc.* | 7,267,539 | ||||||||
256,270 | Microsoft Corp. | 7,219,126 | ||||||||
14,486,665 | ||||||||||
Drugs & Medicine – 1.0% | ||||||||||
53,940 | Amylin Pharmaceuticals, Inc.*(a) | 2,098,805 | ||||||||
Financials – 2.8% | ||||||||||
329,960 | The Charles Schwab Corp. | 6,097,661 | ||||||||
Internet & Online – 7.7% | ||||||||||
19,550 | Google, Inc.* | 8,786,747 | ||||||||
263,960 | Yahoo!, Inc.* | 8,145,806 | ||||||||
16,932,553 | ||||||||||
Medical Products – 5.9% | ||||||||||
185,090 | St. Jude Medical, Inc.* | 7,338,818 | ||||||||
122,540 | Thermo Fisher Scientific, Inc.* | 5,547,386 | ||||||||
12,886,204 | ||||||||||
Movies & Entertainment – 2.1% | ||||||||||
120,055 | Viacom, Inc. Class B* | 4,686,947 | ||||||||
Networking/Telecommunications Equipment – 5.5% | ||||||||||
195,790 | Cisco Systems, Inc.* | 5,078,793 | ||||||||
49,630 | Research In Motion Ltd.* | 6,978,474 | ||||||||
12,057,267 | ||||||||||
Oil & Gas – 3.6% | ||||||||||
110,590 | Suncor Energy, Inc. | 7,866,267 | ||||||||
Oil Well Services & Equipment – 7.6% | ||||||||||
116,610 | Baker Hughes, Inc. | 7,592,477 | ||||||||
143,770 | Schlumberger Ltd. | 9,028,756 | ||||||||
16,621,233 | ||||||||||
Pharmacy Benefit Manager – 3.6% | ||||||||||
116,220 | Medco Health Solutions, Inc.* | 7,857,634 | ||||||||
Retailing – 7.4% | ||||||||||
129,060 | Lowe’s Companies, Inc. | 4,202,193 | ||||||||
101,530 | Target Corp. | 6,247,141 | ||||||||
119,730 | Wal-Mart Stores, Inc. | 5,782,959 | ||||||||
16,232,293 | ||||||||||
Semiconductors – 5.0% | ||||||||||
150,572 | Linear Technology Corp. | 4,997,485 | ||||||||
149,980 | QUALCOMM, Inc. | 6,041,194 | ||||||||
11,038,679 | ||||||||||
Specialty Finance – 7.2% | ||||||||||
85,600 | American Express Co. | 4,868,072 | ||||||||
167,910 | Freddie Mac | 10,776,464 | ||||||||
15,644,536 | ||||||||||
Telecommunications – 8.2% | ||||||||||
201,330 | American Tower Corp.* | 7,799,524 | ||||||||
122,420 | Crown Castle International Corp.* | 4,010,479 | ||||||||
312,380 | Sprint Nextel Corp. | 6,022,687 | ||||||||
17,832,690 | ||||||||||
TOTAL COMMON STOCKS | ||||||||||
(Cost $189,802,366) | $ | 216,771,508 | ||||||||
Principal | Interest | Maturity | ||||||||||||||
Amount | Rate | Date | Value | |||||||||||||
Repurchase Agreement(b) – 3.4% | ||||||||||||||||
Joint Repurchase Agreement Account II | ||||||||||||||||
$ | 7,500,000 | 5.335 | % | 03/01/07 | $ | 7,500,000 | ||||||||||
Maturity Value: $7,501,111 | ||||||||||||||||
(Cost $7,500,000) | ||||||||||||||||
TOTAL INVESTMENTS BEFORE SECURITIES LENDING COLLATERAL | ||||||||||||||||
(Cost $197,302,366) | $ | 224,271,508 | ||||||||||||||
The accompanying notes are an integral part of these financial statements.
30
GOLDMAN SACHS CONCENTRATED GROWTH FUND
Shares | Description | Value | ||||||||
Securities Lending Collateral – 1.1% | ||||||||||
2,411,500 | Boston Global Investment Trust – Enhanced Portfolio | $ | 2,411,500 | |||||||
(Cost $2,411,500) | ||||||||||
TOTAL INVESTMENTS – 103.7% | ||||||||||
(Cost $199,713,866) | $ | 226,683,008 | ||||||||
LIABILITIES IN EXCESS OF OTHER ASSETS – (3.7)% | (8,190,149 | ) | ||||||||
NET ASSETS – 100.0% | $ | 218,492,859 | ||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. |
(a) | All or a portion of security is on loan. |
(b) | Joint repurchase agreement was entered into on February 28, 2007. Additional information appears on page 37. |
The accompanying notes are an integral part of these financial statements.
31
GOLDMAN SACHS GROWTH OPPORTUNITIES FUND
Schedule of Investments
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Common Stocks – 100.2% | ||||||||||
Aerospace & Defense – 2.5% | ||||||||||
536,450 | Alliant Techsystems, Inc.*(a) | $ | 46,429,747 | |||||||
Apparel/Shoes – 5.1% | ||||||||||
1,557,836 | Chico’s FAS, Inc.*(a) | 34,942,262 | ||||||||
753,977 | Coach, Inc.*(a) | 35,587,714 | ||||||||
1,072,500 | Urban Outfitters, Inc.* | 26,619,450 | ||||||||
97,149,426 | ||||||||||
Audio & Visual Equipment – 2.5% | ||||||||||
485,020 | Harman International Industries, Inc. | 48,094,583 | ||||||||
Auto Parts & Related – 1.7% | ||||||||||
1,872,564 | Gentex Corp.(a) | 31,290,544 | ||||||||
Banks – 1.0% | ||||||||||
584,860 | Commerce Bancorp, Inc.(a) | 19,546,021 | ||||||||
Beverages – 1.9% | ||||||||||
439,026 | Fortune Brands, Inc. | 35,297,690 | ||||||||
Biotechnology – 3.5% | ||||||||||
549,496 | Celgene Corp.* | 29,288,137 | ||||||||
1,176,672 | MedImmune, Inc.*(a) | 37,547,603 | ||||||||
66,835,740 | ||||||||||
Broadcasting & Cable/Satellite TV – 2.3% | ||||||||||
3,711,080 | Entravision Communications Corp.*(b) | 33,511,052 | ||||||||
647,343 | XM Satellite Radio Holdings, Inc.*(a) | 9,295,846 | ||||||||
42,806,898 | ||||||||||
Commercial Services – 2.4% | ||||||||||
1,183,881 | Iron Mountain, Inc.* | 32,971,086 | ||||||||
347,031 | Suntech Power Holdings Co., Ltd. ADR*(a) | 12,579,874 | ||||||||
45,550,960 | ||||||||||
Computer Hardware – 2.0% | ||||||||||
1,391,132 | Jabil Circuit, Inc. | 37,171,047 | ||||||||
Computer Services – 3.9% | ||||||||||
1,103,197 | CheckFree Corp.*(a) | 41,833,230 | ||||||||
367,400 | Global Payments, Inc. | 14,133,878 | ||||||||
620,677 | MoneyGram International, Inc. | 18,657,551 | ||||||||
74,624,659 | ||||||||||
Computer Software – 5.9% | ||||||||||
1,946,915 | Activision, Inc.* | 32,552,419 | ||||||||
716,638 | Electronic Arts, Inc.*(a) | 36,132,888 | ||||||||
1,045,466 | NAVTEQ*(a) | 33,413,093 | ||||||||
218,401 | Salesforce.com, Inc.* | 9,448,027 | ||||||||
111,546,427 | ||||||||||
Consumer Services – 0.5% | ||||||||||
215,316 | Weight Watchers International, Inc. | 10,173,681 | ||||||||
Drugs & Medicine – 1.3% | ||||||||||
608,051 | Amylin Pharmaceuticals, Inc.*(a) | 23,659,264 | ||||||||
Electrical Equipment – 1.7% | ||||||||||
1,233,779 | Dresser-Rand Group, Inc.* | 32,041,241 | ||||||||
Financials – 2.9% | ||||||||||
242,679 | HFF, Inc.*(a) | 4,538,098 | ||||||||
395,753 | Legg Mason, Inc. | 40,659,663 | ||||||||
316,961 | Raymond James Financial, Inc. | 9,540,526 | ||||||||
54,738,287 | ||||||||||
Gaming/Lodging – 1.5% | ||||||||||
785,445 | Hilton Hotels Corp.(a) | 27,726,208 | ||||||||
Health Care Services – 1.1% | ||||||||||
340,824 | Covance, Inc.* | 21,015,208 | ||||||||
Hospitals & Related – 0.8% | ||||||||||
363,167 | Psychiatric Solutions, Inc.* | 14,512,153 | ||||||||
Household/Personal Care – 1.8% | ||||||||||
339,772 | Chattem, Inc.*(a) | 18,133,632 | ||||||||
525,539 | Newell Rubbermaid, Inc.(a) | 16,092,004 | ||||||||
34,225,636 | ||||||||||
Insurance – 2.6% | ||||||||||
514,780 | Aon Corp.(a) | 19,381,467 | ||||||||
732,245 | Willis Group Holdings Ltd. | 29,070,126 | ||||||||
48,451,593 | ||||||||||
Internet & Online – 1.6% | ||||||||||
79,900 | Baidu.com, Inc. ADR* | 8,525,330 | ||||||||
2,516,876 | CNET Networks, Inc.* | 22,098,171 | ||||||||
30,623,501 | ||||||||||
Manufacturing – 3.4% | ||||||||||
445,930 | American Standard Companies, Inc.(a) | 23,629,831 | ||||||||
668,165 | Rockwell Automation, Inc. | 41,486,365 | ||||||||
65,116,196 | ||||||||||
Medical Products – 4.7% | ||||||||||
267,841 | C.R. Bard, Inc. | 21,373,712 | ||||||||
319,632 | Cytyc Corp.* | 9,684,849 | ||||||||
999,968 | St. Jude Medical, Inc.* | 39,648,731 | ||||||||
415,192 | Thermo Fisher Scientific, Inc.* | 18,795,742 | ||||||||
89,503,034 | ||||||||||
Medical Supplies – 1.4% | ||||||||||
589,429 | Charles River Laboratories International, Inc.* | 27,025,320 | ||||||||
Networking/Telecommunications Equipment – 1.9% | ||||||||||
87,948 | FLIR Systems, Inc.* | 3,057,073 | ||||||||
161,513 | Leap Wireless International, Inc.* | 10,913,433 | ||||||||
154,039 | Research In Motion Ltd.* | 21,659,424 | ||||||||
35,629,930 | ||||||||||
The accompanying notes are an integral part of these financial statements.
32
GOLDMAN SACHS GROWTH OPPORTUNITIES FUND
Shares | Description | Value | ||||||||
Common Stocks – (continued) | ||||||||||
Oil & Gas – 2.5% | ||||||||||
718,500 | Newfield Exploration Co.* | $ | 31,053,570 | |||||||
444,933 | Quicksilver Resources, Inc.*(a) | 17,161,066 | ||||||||
48,214,636 | ||||||||||
Oil Well Services & Equipment – 9.2% | ||||||||||
899,395 | Cameron International Corp.* | 50,986,702 | ||||||||
865,700 | Grant Prideco, Inc.* | 37,580,037 | ||||||||
1,084,205 | Smith International, Inc. | 44,452,405 | ||||||||
1,029,977 | Weatherford International Ltd.*(a) | 41,353,577 | ||||||||
174,372,721 | ||||||||||
Other Technology – 3.0% | ||||||||||
678,253 | Amphenol Corp. | 43,774,448 | ||||||||
1,098,544 | Cogent, Inc.*(a) | 12,402,562 | ||||||||
56,177,010 | ||||||||||
Pharmacy Benefit Manager – 1.7% | ||||||||||
485,398 | Medco Health Solutions, Inc.* | 32,817,759 | ||||||||
Producer Goods – 1.9% | ||||||||||
455,911 | W.W. Grainger, Inc. | 35,173,534 | ||||||||
Publishing – 3.1% | ||||||||||
136,599 | Focus Media Holding Ltd. ADR* | 10,941,580 | ||||||||
427,565 | Getty Images, Inc.* | 22,425,784 | ||||||||
139,494 | Lamar Advertising Co.* | 8,934,591 | ||||||||
587,366 | National CineMedia, Inc.* | 15,400,736 | ||||||||
57,702,691 | ||||||||||
Retailing – 4.6% | ||||||||||
906,291 | Advance Auto Parts, Inc. | 34,121,856 | ||||||||
70,900 | J.C. Penney Co., Inc. | 5,750,699 | ||||||||
1,381,111 | Williams-Sonoma, Inc.(a) | 46,626,308 | ||||||||
86,498,863 | ||||||||||
Semi Capital – 4.4% | ||||||||||
965,517 | FormFactor, Inc.* | 41,275,852 | ||||||||
1,030,624 | Tessera Technologies, Inc.*(a) | 41,657,822 | ||||||||
82,933,674 | ||||||||||
Semiconductors – 2.1% | ||||||||||
987,740 | Linear Technology Corp.(a) | 32,783,091 | ||||||||
364,350 | Marvell Technology Group Ltd.*(a) | 7,476,462 | ||||||||
40,259,553 | ||||||||||
Technology Services – 1.3% | ||||||||||
264,313 | Cognizant Technology Solutions Corp.* | 23,841,033 | ||||||||
Telecommunications – 4.5% | ||||||||||
602,059 | American Tower Corp.* | 23,323,766 | ||||||||
1,003,038 | Crown Castle International Corp.* | 32,859,525 | ||||||||
929,947 | NeuStar, Inc.* | 29,758,304 | ||||||||
85,941,595 | ||||||||||
TOTAL INVESTMENTS BEFORE SECURITIES LENDING COLLATERAL | ||||||||||
(Cost $1,641,838,922) | $ | 1,894,718,063 | ||||||||
Securities Lending Collateral – 16.1% | ||||||||||
304,372,025 | Boston Global Investment Trust – Enhanced Portfolio | $ | 304,372,025 | |||||||
(Cost $304,372,025) | ||||||||||
TOTAL INVESTMENTS – 116.3% | ||||||||||
(Cost $1,946,210,947) | $ | 2,199,090,088 | ||||||||
LIABILITIES IN EXCESS OF OTHER ASSETS – (16.3)% | (308,855,584 | ) | ||||||||
NET ASSETS – 100.0% | $ | 1,890,234,504 | ||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. |
(a) | All or a portion of security is on loan. |
(b) | Represents an affiliated issuer. |
Investment Abbreviation: | ||||||
ADR | — | American Depositary Receipt | ||||
The accompanying notes are an integral part of these financial statements.
33
GOLDMAN SACHS SMALL/MID CAP GROWTH FUND
Schedule of Investments
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Common Stocks – 99.2% | ||||||||||
Aerospace/Defense – 2.0% | ||||||||||
24,700 | Aerovironment, Inc.* | $ | 525,369 | |||||||
14,900 | Alliant Techsystems, Inc.* | 1,289,595 | ||||||||
1,814,964 | ||||||||||
Apparel/Shoes – 2.5% | ||||||||||
46,010 | Chico’s FAS, Inc.* | 1,032,004 | ||||||||
49,530 | Urban Outfitters, Inc.* | 1,229,335 | ||||||||
2,261,339 | ||||||||||
Audio & Visual Equipment – 1.8% | ||||||||||
16,360 | Harman International Industries, Inc. | 1,622,258 | ||||||||
Audio Technology – 0.9% | ||||||||||
24,720 | Dolby Laboratories, Inc.* | 791,040 | ||||||||
Banks – 1.0% | ||||||||||
27,680 | Commerce Bancorp, Inc. | 925,066 | ||||||||
Beverages – 0.6% | ||||||||||
15,900 | Hansen Natural Corp.* | 556,500 | ||||||||
Biotechnology – 2.7% | ||||||||||
15,600 | Affymax, Inc.* | 555,516 | ||||||||
44,332 | Cadence Pharmaceuticals, Inc.*(a) | 632,174 | ||||||||
39,200 | MedImmune, Inc.* | 1,250,872 | ||||||||
2,438,562 | ||||||||||
Broadcasting & Cable/Satellite TV – 1.9% | ||||||||||
166,970 | Entravision Communications Corp.* | 1,507,739 | ||||||||
47,700 | Imax Corp.*(a) | 217,989 | ||||||||
1,725,728 | ||||||||||
Commercial Services – 5.7% | ||||||||||
16,200 | Bankrate, Inc.*(a) | 657,558 | ||||||||
25,270 | Bright Horizons Family Solutions, Inc.* | 1,012,822 | ||||||||
9,100 | First Solar, Inc.* | 434,525 | ||||||||
33,945 | Iron Mountain, Inc.* | 945,368 | ||||||||
44,080 | LoJack Corp.* | 839,283 | ||||||||
21,060 | Rollins, Inc. | 484,380 | ||||||||
19,500 | Suntech Power Holdings Co., Ltd. ADR*(a) | 706,875 | ||||||||
5,080,811 | ||||||||||
Computer Hardware – 2.3% | ||||||||||
27,790 | Coinstar, Inc.* | 820,083 | ||||||||
45,200 | Jabil Circuit, Inc. | 1,207,744 | ||||||||
2,027,827 | ||||||||||
Computer Services – 2.4% | ||||||||||
32,300 | CheckFree Corp.* | 1,224,816 | ||||||||
29,000 | MoneyGram International, Inc. | 871,740 | ||||||||
2,096,556 | ||||||||||
Computer Software – 3.6% | ||||||||||
100,120 | Activision, Inc.* | 1,674,006 | ||||||||
32,370 | NAVTEQ* | 1,034,545 | ||||||||
10,500 | Salesforce.com, Inc.* | 454,230 | ||||||||
3,162,781 | ||||||||||
Consumer Services – 3.1% | ||||||||||
23,500 | Ritchie Bros. Auctioneers, Inc. | 1,349,135 | ||||||||
31,400 | VCA Antech, Inc.* | 1,152,694 | ||||||||
5,875 | Weight Watchers International, Inc. | 277,594 | ||||||||
2,779,423 | ||||||||||
Drugs & Medicine – 5.1% | ||||||||||
13,700 | Alexion Pharmaceuticals, Inc.* | 505,256 | ||||||||
20,000 | Amylin Pharmaceuticals, Inc.*(a) | 778,200 | ||||||||
26,802 | Healthcare Services Group, Inc. | 751,528 | ||||||||
116,290 | OraSure Technologies, Inc.* | 925,668 | ||||||||
17,700 | Progenics Pharmaceuticals, Inc.* | 491,175 | ||||||||
46,200 | Vanda Pharmaceuticals, Inc.*(a) | 1,111,572 | ||||||||
4,563,399 | ||||||||||
Electrical Equipment – 1.5% | ||||||||||
49,700 | Dresser-Rand Group, Inc.* | 1,290,709 | ||||||||
Financials – 5.8% | ||||||||||
35,800 | Cowen Group, Inc.* | 710,272 | ||||||||
20,800 | Eaton Vance Corp. | 721,552 | ||||||||
20,520 | Federated Investors, Inc. Class B | 734,000 | ||||||||
12,500 | HFF, Inc.* | 233,750 | ||||||||
20,120 | Nuveen Investments, Inc. | 979,643 | ||||||||
34,755 | Raymond James Financial, Inc. | 1,046,126 | ||||||||
14,400 | Stifel Financial Corp.*(a) | 686,160 | ||||||||
5,111,503 | ||||||||||
Health Care Services – 1.3% | ||||||||||
19,150 | Covance, Inc.* | 1,180,789 | ||||||||
Hospitals & Related – 1.8% | ||||||||||
39,780 | Psychiatric Solutions, Inc.* | 1,589,609 | ||||||||
Household/Personal Care – 2.1% | ||||||||||
49,200 | Central Garden & Pet Co.* | 689,784 | ||||||||
22,810 | Chattem, Inc.* | 1,217,370 | ||||||||
1,907,154 | ||||||||||
Internet & Online – 1.4% | ||||||||||
6,700 | Baidu.com, Inc. ADR* | 714,890 | ||||||||
56,940 | CNET Networks, Inc.* | 499,933 | ||||||||
1,214,823 | ||||||||||
Leisure – 0.6% | ||||||||||
11,240 | Life Time Fitness, Inc.* | 537,272 | ||||||||
Manufacturing – 3.7% | ||||||||||
9,000 | IDEX Corp. | 468,090 | ||||||||
14,600 | Kennametal, Inc. | 893,520 | ||||||||
22,870 | Roper Industries, Inc. | 1,214,854 | ||||||||
18,380 | Watts Water Technologies, Inc. | 692,191 | ||||||||
3,268,655 | ||||||||||
The accompanying notes are an integral part of these financial statements.
34
GOLDMAN SACHS SMALL/MID CAP GROWTH FUND
Shares | Description | Value | ||||||||
Common Stocks – (continued) | ||||||||||
Medical Products – 4.5% | ||||||||||
17,600 | ArthroCare Corp.* | $ | 639,760 | |||||||
44,340 | Cytyc Corp.* | 1,343,502 | ||||||||
12,200 | Gen-Probe, Inc.* | 585,844 | ||||||||
56,254 | Natus Medical, Inc.* | 906,252 | ||||||||
41,000 | Northstar Neuroscience, Inc.*(a) | 493,640 | ||||||||
3,968,998 | ||||||||||
Medical Supplies – 1.0% | ||||||||||
19,060 | Charles River Laboratories International, Inc.* | 873,901 | ||||||||
Movies & Entertainment – 0.4% | ||||||||||
14,000 | LodgeNet Entertainment Corp.* | 357,840 | ||||||||
Networking/Telecommunications Equipment – 1.8% | ||||||||||
25,410 | FLIR Systems, Inc.*(a) | 883,252 | ||||||||
7,700 | Leap Wireless International, Inc.* | 520,289 | ||||||||
8,600 | Optium Corp.* | 197,886 | ||||||||
1,601,427 | ||||||||||
Oil & Gas – 3.4% | ||||||||||
31,400 | Delta Petroleum Corp.*(a) | 628,000 | ||||||||
72,140 | OPTI Canada, Inc.* | 1,211,380 | ||||||||
29,700 | Quicksilver Resources, Inc.*(a) | 1,145,529 | ||||||||
2,984,909 | ||||||||||
Oil Well Services & Equipment – 4.7% | ||||||||||
26,080 | Cameron International Corp.* | 1,478,475 | ||||||||
30,340 | Grant Prideco, Inc.* | 1,317,060 | ||||||||
276,000 | UTS Energy Corp.* | 936,833 | ||||||||
9,990 | W-H Energy Services, Inc.* | 419,580 | ||||||||
4,151,948 | ||||||||||
Other Energy – 0.5% | ||||||||||
8,388 | Atlas America, Inc.* | 448,003 | ||||||||
Other Health Care – 1.6% | ||||||||||
25,900 | eHealth, Inc.* | 648,018 | ||||||||
36,000 | Physicians Formula Holdings, Inc.* | 728,280 | ||||||||
1,376,298 | ||||||||||
Other Producer Goods & Services – 1.0% | ||||||||||
58,910 | TurboChef Technologies, Inc.*(a) | 884,239 | ||||||||
Other Technology – 1.9% | ||||||||||
19,550 | Amphenol Corp. | 1,261,757 | ||||||||
38,460 | Cogent, Inc.* | 434,213 | ||||||||
1,695,970 | ||||||||||
Producer Goods – 1.6% | ||||||||||
18,770 | W.W. Grainger, Inc. | 1,448,105 | ||||||||
Publishing – 2.8% | ||||||||||
6,400 | Focus Media Holding Ltd. ADR* | 512,640 | ||||||||
11,700 | Getty Images, Inc.* | 613,665 | ||||||||
9,300 | Lamar Advertising Co.* | 595,665 | ||||||||
27,800 | National CineMedia, Inc.* | 728,916 | ||||||||
2,450,886 | ||||||||||
Restaurants – 2.7% | ||||||||||
19,980 | P.F. Chang’s China Bistro, Inc.*(a) | 872,926 | ||||||||
12,390 | Panera Bread Co.*(a) | 758,640 | ||||||||
52,742 | Texas Roadhouse, Inc.* | 772,670 | ||||||||
2,404,236 | ||||||||||
Retailing – 5.6% | ||||||||||
25,000 | Advance Auto Parts, Inc. | 941,250 | ||||||||
10,980 | Blue Nile, Inc.*(a) | 428,220 | ||||||||
20,300 | GameStop Corp.* | 1,064,126 | ||||||||
21,790 | Tractor Supply Co.* | 1,114,994 | ||||||||
42,110 | Williams-Sonoma, Inc. | 1,421,634 | ||||||||
4,970,224 | ||||||||||
Semi Capital – 5.8% | ||||||||||
64,010 | Eagle Test Systems, Inc.* | 1,131,057 | ||||||||
38,250 | FormFactor, Inc.* | 1,635,187 | ||||||||
58,990 | Tessera Technologies, Inc.* | 2,384,376 | ||||||||
5,150,620 | ||||||||||
Semiconductors – 0.3% | ||||||||||
40,950 | PMC-Sierra, Inc.* | 276,412 | ||||||||
Specialty Finance – 1.1% | ||||||||||
15,171 | Advanta Corp. Class B | 633,693 | ||||||||
11,700 | Evercore Partners, Inc.* | 375,453 | ||||||||
1,009,146 | ||||||||||
Technology Services – 0.5% | ||||||||||
3,020 | Switch & Data Facilities Co.* | 58,830 | ||||||||
35,600 | TradeStation Group, Inc.* | 420,792 | ||||||||
479,622 | ||||||||||
Telecommunications – 4.2% | ||||||||||
30,940 | Crown Castle International Corp.* | 1,013,594 | ||||||||
29,700 | Heartland Payment Systems, Inc.(a) | 740,124 | ||||||||
32,470 | NeuStar, Inc.* | 1,039,040 | ||||||||
34,650 | SBA Communications Corp.* | 934,511 | ||||||||
3,727,269 | ||||||||||
TOTAL COMMON STOCKS | ||||||||||
(Cost $82,416,818) | $ | 88,206,821 | ||||||||
Principal | Interest | Maturity | ||||||||||||||
Amount | Rate | Date | Value | |||||||||||||
Repurchase Agreement(b) – 4.0% | ||||||||||||||||
Joint Repurchase Agreement Account II | ||||||||||||||||
$ | 3,600,000 | 5.335 | % | 03/01/07 | $ | 3,600,000 | ||||||||||
Maturity Value: $3,600,534 | ||||||||||||||||
(Cost $3,600,000) | ||||||||||||||||
TOTAL INVESTMENTS BEFORE SECURITIES LENDING COLLATERAL | ||||||||||||||||
(Cost $86,016,818) | $ | 91,806,821 | ||||||||||||||
The accompanying notes are an integral part of these financial statements.
35
GOLDMAN SACHS SMALL/MID CAP GROWTH FUND
Schedule of Investments (continued)
February 28, 2007 (Unaudited)
Shares | Description | Value | ||||||||
Securities Lending Collateral – 10.4% | ||||||||||
9,226,475 | Boston Global Investment Trust – Enhanced Portfolio | $ | 9,226,475 | |||||||
(Cost $9,226,475) | ||||||||||
TOTAL INVESTMENTS – 113.6% | ||||||||||
(Cost $95,243,293) | $ | 101,033,296 | ||||||||
LIABILITIES IN EXCESS OF OTHER ASSETS – (13.6)% | (12,090,810 | ) | ||||||||
NET ASSETS – 100.0% | $ | 88,942,486 | ||||||||
The percentage shown for each investment category reflects the value of investments in that category as a percentage of net assets. |
* | Non-income producing security. |
(a) | All or a portion of security is on loan. |
(b) | Joint repurchase agreement was entered into on February 28, 2007. Additional information appears on page 37. |
Investment Abbreviation: | ||||||
ADR | — | American Depositary Receipt | ||||
The accompanying notes are an integral part of these financial statements.
36
GOLDMAN SACHS GROWTH EQUITY FUNDS
ADDITIONAL INVESTMENT INFORMATION |
JOINT REPURCHASE AGREEMENT ACCOUNT II — At February 28, 2007, the Funds had undivided interests in the Joint Repurchase Agreement Account II, as follows:
Fund | Principal Amount | |||
Capital Growth | $ | 18,100,000 | ||
Concentrated Growth | 7,500,000 | |||
Small/Mid Cap Growth | 3,600,000 | |||
REPURCHASE AGREEMENTS
Principal | Interest | Maturity | Maturity | |||||||||||
Counterparty | Amount | Rate | Date | Value | ||||||||||
ABN Amro, Inc. | $ | 1,000,000,000 | 5.33 | % | 03/01/07 | $ | 1,000,148,056 | |||||||
Banc of America Securities LLC | 900,000,000 | 5.33 | 03/01/07 | 900,133,250 | ||||||||||
Barclays Capital PLC | 750,000,000 | 5.34 | 03/01/07 | 750,111,250 | ||||||||||
Citigroup Global Markets, Inc. | 1,000,000,000 | 5.34 | 03/01/07 | 1,000,148,333 | ||||||||||
Credit Suisse Securities (USA) LLC | 1,000,000,000 | 5.33 | 03/01/07 | 1,000,148,056 | ||||||||||
Deutsche Bank Securities, Inc. | 3,750,000,000 | 5.34 | 03/01/07 | 3,750,556,250 | ||||||||||
Greenwich Capital Markets | 300,000,000 | 5.34 | 03/01/07 | 300,044,500 | ||||||||||
Merrill Lynch | 1,000,000,000 | 5.33 | 03/01/07 | 1,000,148,056 | ||||||||||
Morgan Stanley & Co. | 800,000,000 | 5.33 | 03/01/07 | 800,118,444 | ||||||||||
UBS Securities LLC | 507,500,000 | 5.33 | 03/01/07 | 507,575,138 | ||||||||||
Wachovia Capital Markets | 250,000,000 | 5.33 | 03/01/07 | 250,037,014 | ||||||||||
TOTAL | $ | 11,257,500,000 | $ | 11,259,168,347 | ||||||||||
At February 28, 2007, the Joint Repurchase Agreement Account II was fully collateralized by Federal Home Loan Bank, 0.00% to 7.23%, due 03/07/07 to 11/15/17; Federal Home Loan Mortgage Association, 0.00% to 11.00%, due 09/01/07 to 03/01/37; Federal National Mortgage Association, 3.50% to 10.50%, due 11/01/07 to 10/01/46 and Government National Mortgage Association, 4.50% to 7.50%, due 08/15/18 to 02/15/37. The aggregate market value of the collateral, including accrued interest, was $11,517,202,142.
The accompanying notes are an integral part of these financial statements.
37
GOLDMAN SACHS GROWTH EQUITY FUNDS
Statements of Assets and Liabilities
February 28, 2007 (Unaudited)
Capital Growth | |||||||||
Fund | |||||||||
Assets: | |||||||||
Investments in securities, at value (identified cost $1,380,946,128, $251,165,790, $197,302,366, $1,610,847,328 and $86,016,818, respectively) (a) | $ | 1,766,511,650 | |||||||
Investment in securities of affiliated issuers, at value (identified cost $30,991,594) | — | ||||||||
Securities lending collateral, at value which equals cost | 111,335,150 | ||||||||
Cash | 74,328 | ||||||||
Receivables: | |||||||||
Investment securities sold | 9,176,223 | ||||||||
Dividends and interest | 1,655,774 | ||||||||
Fund shares sold | 1,778,541 | ||||||||
Securities lending income | 5,582 | ||||||||
Other assets | 20,648 | ||||||||
Total assets | 1,890,557,896 | ||||||||
Liabilities: | |||||||||
Due to Custodian | — | ||||||||
Payables: | |||||||||
Payable upon return of securities loaned | 111,335,150 | ||||||||
Investment securities purchased | 8,218,115 | ||||||||
Fund shares repurchased | 4,338,304 | ||||||||
Amounts owed to affiliates | 1,985,498 | ||||||||
Accrued expenses | 354,834 | ||||||||
Total liabilities | 126,231,901 | ||||||||
Net Assets: | |||||||||
Paid-in capital | 1,542,077,489 | ||||||||
Accumulated net investment loss | (2,793,802 | ) | |||||||
Accumulated net realized gain (loss) on investment transactions | (160,523,214 | ) | |||||||
Net unrealized gain on investments | 385,565,522 | ||||||||
NET ASSETS | $ | 1,764,325,995 | |||||||
Net Assets: | |||||||||
Class A | $ | 1,318,700,104 | |||||||
Class B | 78,736,104 | ||||||||
Class C | 64,334,271 | ||||||||
Institutional | 292,743,538 | ||||||||
Service | 9,811,978 | ||||||||
Shares Outstanding: | |||||||||
Class A | 59,301,895 | ||||||||
Class B | 3,853,051 | ||||||||
Class C | 3,153,163 | ||||||||
Institutional | 12,757,959 | ||||||||
Service | 446,716 | ||||||||
Total shares of beneficial interest outstanding, $0.001 par value (unlimited number of shares authorized) | 79,512,784 | ||||||||
Net asset value, offering and redemption price per share:(b) | |||||||||
Class A | $22.24 | ||||||||
Class B | 20.43 | ||||||||
Class C | 20.40 | ||||||||
Institutional | 22.95 | ||||||||
Service | 21.96 | ||||||||
(a) | Includes loaned securities having a market value of $108,686,818, $2,202,424, $2,346,670, $295,840,489, and $9,013,329 for the Capital Growth, Strategic Growth, Concentrated Growth, Growth Opportunities, and Small/Mid Cap Growth Funds, respectively. |
(b) | Maximum public offering price per share (NAV per share multiplied by 1.0582) for Class A Shares of the Capital Growth, Strategic Growth, Concentrated Growth, Growth Opportunities and Small/Mid Cap Growth Funds is $23.53, $10.24, $14.39, $23.96 and $12.83, respectively. At redemption, Class B and Class C Shares may be subject to a contingent deferred sales charge, assessed on the amount equal to the lesser of the current NAV or the original purchase price of the shares. |
The accompanying notes are an integral part of these financial statements.
38
GOLDMAN SACHS GROWTH EQUITY FUNDS |
Strategic | Concentrated | Growth | Small/Mid Cap | |||||||||||||||
Growth Fund | Growth Fund | Opportunities Fund | Growth Fund | |||||||||||||||
$ | 302,098,395 | $ | 224,271,508 | $ | 1,861,207,011 | $ | 91,806,821 | |||||||||||
— | — | 33,511,052 | — | |||||||||||||||
2,225,900 | 2,411,500 | 304,372,025 | 9,226,475 | |||||||||||||||
3,305,020 | 90,167 | — | — | |||||||||||||||
— | — | 13,634,448 | 597,180 | |||||||||||||||
244,241 | 132,991 | 853,508 | 27,203 | |||||||||||||||
335,994 | 277,646 | 3,940,572 | 287,791 | |||||||||||||||
140 | 177 | 92,234 | 14,885 | |||||||||||||||
3,904 | 2,713 | 21,195 | 1,346 | |||||||||||||||
308,213,594 | 227,186,702 | 2,217,632,045 | 101,961,701 | |||||||||||||||
— | — | 2,727,704 | 237,203 | |||||||||||||||
2,225,900 | 2,411,500 | 304,372,025 | 9,226,475 | |||||||||||||||
— | 5,471,315 | 10,591,756 | 2,470,806 | |||||||||||||||
688,486 | 266,999 | 7,301,491 | 768,549 | |||||||||||||||
385,333 | 243,691 | 1,991,919 | 168,440 | |||||||||||||||
237,264 | 300,338 | 412,646 | 147,742 | |||||||||||||||
3,536,983 | 8,693,843 | 327,397,541 | 13,019,215 | |||||||||||||||
315,067,238 | 188,769,479 | 1,594,283,105 | 83,121,032 | |||||||||||||||
(386,720 | ) | (351,130 | ) | (1,310,613 | ) | (256,955 | ) | |||||||||||
(60,936,512 | ) | 3,105,368 | 44,382,871 | 288,406 | ||||||||||||||
50,932,605 | 26,969,142 | 252,879,141 | 5,790,003 | |||||||||||||||
$ | 304,676,611 | $ | 218,492,859 | $ | 1,890,234,504 | $ | 88,942,486 | |||||||||||
$ | 132,469,432 | $ | 76,890,845 | $ | 908,298,757 | $ | 79,999,308 | |||||||||||
6,840,416 | 571,732 | 64,635,389 | 1,917,583 | |||||||||||||||
10,123,420 | 724,400 | 113,918,173 | 5,183,585 | |||||||||||||||
155,240,461 | 140,303,684 | 792,382,823 | 1,644,708 | |||||||||||||||
2,882 | 2,198 | 10,999,362 | 197,302 | |||||||||||||||
13,680,155 | 5,654,187 | 40,116,852 | 6,598,002 | |||||||||||||||
748,401 | 43,553 | 3,021,118 | 160,621 | |||||||||||||||
1,105,921 | 55,287 | 5,364,134 | 434,225 | |||||||||||||||
15,614,709 | 10,157,927 | 33,841,615 | 135,159 | |||||||||||||||
297 | 162 | 490,554 | 16,351 | |||||||||||||||
31,149,483 | 15,911,116 | 82,834,273 | 7,344,358 | |||||||||||||||
$9.68 | $ | 13.60 | $ | 22.64 | $ | 12.12 | ||||||||||||
9.14 | 13.13 | 21.39 | 11.94 | |||||||||||||||
9.15 | 13.10 | 21.24 | 11.94 | |||||||||||||||
9.94 | 13.81 | 23.41 | 12.17 | |||||||||||||||
9.71 | 13.58 | 22.42 | 12.07 | |||||||||||||||
The accompanying notes are an integral part of these financial statements.
39
GOLDMAN SACHS GROWTH EQUITY FUNDS
Statements of Operations
For the Six Months Ended February 28, 2007 (Unaudited)
Capital | ||||||
Growth Fund | ||||||
Investment income: | ||||||
Dividends(a) | $ | 7,472,607 | ||||
Interest (including securities lending income of $70,871, $1,411, $520, $270,842 and $98,107, respectively) | 551,784 | |||||
Total income | 8,024,391 | |||||
Expenses: | ||||||
Management fees | 8,527,429 | |||||
Distribution and service fees(b) | 2,441,440 | |||||
Transfer agent fees(b) | 1,472,395 | |||||
Custody and accounting fees | 58,582 | |||||
Registration fees | 40,965 | |||||
Professional fees | 37,004 | |||||
Service share fees | 23,821 | |||||
Trustee fees | 8,119 | |||||
Other | 100,078 | |||||
Total expenses | 12,709,833 | |||||
Less — expense reductions | (254,059 | ) | ||||
Net expenses | 12,455,774 | |||||
NET INVESTMENT LOSS | (4,431,383 | ) | ||||
Realized and unrealized gain (loss) on investment transactions: | ||||||
Net realized gain from investment transactions — unaffiliated issuers (including commissions recaptured of $66,709, $18,459, $0, $82,994, and $0, respectively) | 79,722,728 | |||||
Net realized loss from investment transactions — affiliated issuers | — | |||||
Net change in unrealized gain on investments | 59,463,122 | |||||
Net realized and unrealized gain on investment transactions | 139,185,850 | |||||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $ | 134,754,467 | ||||
(a) | Foreign taxes withheld on dividends were $20,653, $1,687, $994, $0 and $1,487, for Capital Growth, Strategic Growth, Concentrated Growth, Growth Opportunities and Small/Mid Cap Growth Funds, respectively. |
(b) | Class specific distribution, service and transfer agent fees were as follows: |
Distribution and Service Fees | Transfer Agent Fees | |||||||||||||||||||||||||||||||
Fund | Class A | Class B | Class C | Class A | Class B | Class C | Institutional | Service | ||||||||||||||||||||||||
Capital Growth | $ | 1,664,936 | $ | 435,876 | $ | 340,628 | $ | 1,265,352 | $ | 82,816 | $ | 64,719 | $ | 57,602 | $ | 1,906 | ||||||||||||||||
Strategic Growth | 164,177 | 36,426 | 51,348 | 124,774 | 6,921 | 9,756 | 35,079 | 1 | ||||||||||||||||||||||||
Concentrated Growth | 90,798 | 2,362 | 3,158 | 69,006 | 449 | 600 | 26,434 | — | ||||||||||||||||||||||||
Growth Opportunities | 1,137,124 | 337,741 | 572,756 | 864,214 | 64,171 | 108,824 | 158,144 | 2,114 | ||||||||||||||||||||||||
Small/ Mid Cap Growth | 95,085 | 8,835 | 30,505 | 72,264 | 1,679 | 5,796 | 297 | 35 |
The accompanying notes are an integral part of these financial statements.
40
GOLDMAN SACHS GROWTH EQUITY FUNDS
Strategic | Concentrated | Growth | Small/Mid Cap | |||||||||||||||
Growth Fund | Growth Fund | Opportunities Fund | Growth Fund | |||||||||||||||
$ | 1,309,297 | $ | 796,523 | $ | 4,508,169 | $ | 119,087 | |||||||||||
47,745 | 111,244 | 356,816 | 124,195 | |||||||||||||||
1,357,042 | 907,767 | 4,864,985 | 243,282 | |||||||||||||||
1,621,499 | 1,029,566 | 9,465,440 | 427,974 | |||||||||||||||
251,951 | 96,318 | 2,047,621 | 134,425 | |||||||||||||||
176,531 | 96,489 | 1,197,467 | 80,071 | |||||||||||||||
25,589 | 24,183 | 73,993 | 22,870 | |||||||||||||||
21,182 | 58,832 | 53,717 | 3,280 | |||||||||||||||
21,063 | 23,208 | 37,539 | 14,025 | |||||||||||||||
19 | 5 | 26,418 | 437 | |||||||||||||||
8,119 | 8,119 | 8,119 | 8,119 | |||||||||||||||
15,865 | 10,528 | 112,719 | 2,587 | |||||||||||||||
2,141,818 | 1,347,248 | 13,023,033 | 693,788 | |||||||||||||||
(90,167 | ) | (83,245 | ) | (39,738 | ) | (27,755 | ) | |||||||||||
2,051,651 | 1,264,003 | 12,983,295 | 666,033 | |||||||||||||||
(694,609 | ) | (356,236 | ) | (8,118,310 | ) | (422,751 | ) | |||||||||||
15,747,609 | 5,450,471 | 88,293,265 | 2,599,022 | |||||||||||||||
— | — | (186,092 | ) | — | ||||||||||||||
8,837,873 | 11,177,637 | 178,440,482 | 10,612,391 | |||||||||||||||
24,585,482 | 16,628,108 | 266,547,655 | 13,211,413 | |||||||||||||||
$ | 23,890,873 | $ | 16,271,872 | $ | 258,429,345 | $ | 12,788,662 | |||||||||||
The accompanying notes are an integral part of these financial statements.
41
GOLDMAN SACHS GROWTH EQUITY FUNDS
Statements of Changes in Net Assets
Capital Growth Fund | Strategic Growth Fund | ||||||||||||||||||
For the | For the | ||||||||||||||||||
Six Months Ended | For the | Six Months Ended | For the | ||||||||||||||||
February 28, 2007 | Year Ended | February 28, 2007 | Year Ended | ||||||||||||||||
(Unaudited) | August 31, 2006 | (Unaudited) | August 31, 2006 | ||||||||||||||||
From operations: | |||||||||||||||||||
Net investment loss | $ | (4,431,383 | ) | $ | (8,053,405 | ) | $ | (694,609 | ) | $ | (1,182,045 | ) | |||||||
Net realized gain (loss) from investment transactions | 79,722,728 | 120,202,002 | 15,747,609 | 11,514,871 | |||||||||||||||
Net change in unrealized gain (loss) on investments | 59,463,122 | (58,053,651 | ) | 8,837,873 | (389,495 | ) | |||||||||||||
Net increase (decrease) in net assets from operations | 134,754,467 | 54,094,946 | 23,890,873 | 9,943,331 | |||||||||||||||
Distributions to shareholders: | |||||||||||||||||||
From net investment income | |||||||||||||||||||
Class A Shares | — | (887,551 | ) | — | — | ||||||||||||||
Institutional Shares | — | (1,237,696 | ) | — | (157,294 | ) | |||||||||||||
Service Shares | — | (14,681 | ) | — | — | ||||||||||||||
From net realized gains | |||||||||||||||||||
Class A Shares | — | — | — | — | |||||||||||||||
Class B Shares | — | — | — | — | |||||||||||||||
Class C Shares | — | — | — | — | |||||||||||||||
Institutional Shares | — | — | — | — | |||||||||||||||
Service Shares | — | — | — | — | |||||||||||||||
Total distributions to shareholders | — | (2,139,928 | ) | — | (157,294 | ) | |||||||||||||
From share transactions: | |||||||||||||||||||
Proceeds from sales of shares | 115,701,642 | 260,223,152 | 29,727,038 | 130,416,971 | |||||||||||||||
Reinvestment of dividends and distributions | — | 1,710,342 | — | 124,896 | |||||||||||||||
Cost of shares repurchased | (223,230,645 | ) | (476,035,070 | ) | (77,931,991 | ) | (153,061,379 | ) | |||||||||||
Net increase (decrease) in net assets resulting from share transactions | (107,529,003 | ) | (214,101,576 | ) | (48,204,953 | ) | (22,519,512 | ) | |||||||||||
TOTAL INCREASE (DECREASE) | 27,225,464 | (162,146,558 | ) | (24,314,080 | ) | (12,733,475 | ) | ||||||||||||
Net assets: | |||||||||||||||||||
Beginning of period | 1,737,100,531 | 1,899,247,089 | 328,990,691 | 341,724,166 | |||||||||||||||
End of period | $ | 1,764,325,995 | $ | 1,737,100,531 | $ | 304,676,611 | $ | 328,990,691 | |||||||||||
Accumulated net investment income (loss) | $ | (2,793,802 | ) | $ | 1,637,581 | $ | (386,720 | ) | $ | 307,889 | |||||||||
The accompanying notes are an integral part of these financial statements.
42
GOLDMAN SACHS GROWTH EQUITY FUNDS
Concentrated Growth Fund | Growth Opportunities Fund | Small/Mid Cap Growth Fund | ||||||||||||||||||||||
For the | For the | For the | ||||||||||||||||||||||
Six Months Ended | For the | Six Months Ended | For the | Six Months Ended | For the | |||||||||||||||||||
February 28, 2007 | Year Ended | February 28, 2007 | Year Ended | February 28, 2007 | Year Ended | |||||||||||||||||||
(Unaudited) | August 31, 2006 | (Unaudited) | August 31, 2006 | (Unaudited) | August 31, 2006 | |||||||||||||||||||
$ | (356,236 | ) | $ | (429,262 | ) | $ | (8,118,310 | ) | $ | (16,868,962 | ) | $ | (422,751 | ) | $ | (398,344 | ) | |||||||
5,450,471 | 6,875,210 | 88,107,173 | 138,401,431 | 2,599,022 | (2,208,449 | ) | ||||||||||||||||||
11,177,637 | 61,305 | 178,440,482 | (166,709,431 | ) | 10,612,391 | (5,026,019 | ) | |||||||||||||||||
16,271,872 | 6,507,253 | 258,429,345 | (45,176,962 | ) | 12,788,662 | (7,632,812 | ) | |||||||||||||||||
— | — | — | — | — | (268 | ) | ||||||||||||||||||
— | (287,210 | ) | — | — | — | (658 | ) | |||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||||
(2,448,956 | ) | (1,497,742 | ) | (47,042,599 | ) | (49,275,016 | ) | — | (26,512 | ) | ||||||||||||||
(17,173 | ) | (3,717 | ) | (3,676,650 | ) | (4,687,606 | ) | — | (1,714 | ) | ||||||||||||||
(23,504 | ) | (10,126 | ) | (6,253,316 | ) | (6,284,766 | ) | — | (1,179 | ) | ||||||||||||||
(4,595,818 | ) | (2,216,330 | ) | (39,775,669 | ) | (43,875,973 | ) | — | (59,790 | ) | ||||||||||||||
(75 | ) | (48 | ) | (549,610 | ) | (472,600 | ) | — | (109 | ) | ||||||||||||||
(7,085,526 | ) | (4,015,173 | ) | (97,297,844 | ) | (104,595,961 | ) | — | (90,230 | ) | ||||||||||||||
33,964,077 | 77,832,567 | 223,178,785 | 914,376,026 | 16,159,075 | 112,002,093 | |||||||||||||||||||
6,761,049 | 3,733,414 | 84,975,070 | 91,602,839 | — | 87,553 | |||||||||||||||||||
(20,426,369 | ) | (43,505,163 | ) | (451,935,158 | ) | (871,320,874 | ) | (21,142,019 | ) | (29,311,570 | ) | |||||||||||||
20,298,757 | 38,060,818 | (143,781,303 | ) | 134,657,991 | (4,982,944 | ) | 82,778,076 | |||||||||||||||||
29,485,103 | 40,552,898 | 17,350,198 | (15,114,932 | ) | 7,805,718 | 75,055,034 | ||||||||||||||||||
189,007,756 | 148,454,858 | 1,872,884,306 | 1,887,999,238 | 81,136,768 | 6,081,734 | |||||||||||||||||||
$ | 218,492,859 | $ | 189,007,756 | $ | 1,890,234,504 | $ | 1,872,884,306 | $ | 88,942,486 | $ | 81,136,768 | |||||||||||||
$ | (351,130 | ) | $ | 5,106 | $ | (1,310,613 | ) | $ | 6,807,697 | $ | (256,955 | ) | $ | 165,796 | ||||||||||
The accompanying notes are an integral part of these financial statements.
43
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements
February 28, 2007 (Unaudited)
1. ORGANIZATION |
Goldman Sachs Trust (the “Trust”) is a Delaware statutory trust registered under the Investment Company Act of 1940 (the “Act”), as amended, as an open-end management investment company. The Trust includes the Goldman Sachs Capital Growth Fund, Goldman Sachs Strategic Growth Fund, Goldman Sachs Concentrated Growth Fund, Goldman Sachs Growth Opportunities Fund, and Goldman Sachs Small/Mid Cap Growth Fund collectively, the “Funds” or individually a “Fund”. Each Fund (except the Concentrated Growth Fund) is a diversified portfolio. Concentrated Growth is a non-diversified portfolio. Each Fund offers five classes of shares — Class A, Class B, Class C, Institutional and Service. Class A shares of the Funds are sold with a front-end sales charge of up to 5.50%. Class B shares of the Funds are sold with a contingent deferred sales charge that declines from 5.00% to zero, depending upon the period of time the shares are held. Class C shares of the Funds are sold with a contingent deferred sales charge of 1.00% during the first 12 months. Institutional and Service Class shares of the Funds are not subject to a sales charge. Goldman, Sachs & Co. (“Goldman Sachs”) as distributor of the Funds receives such sales loads of which a certain portion may be retained.
2. SIGNIFICANT ACCOUNTING POLICIES |
The following is a summary of the significant accounting policies consistently followed by the Funds. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that may affect the reported amounts. Actual results could differ from those estimates.
A. Investment Valuation — Investments in equity securities and investment companies traded on a U.S. securities exchange or the NASDAQ system are valued daily at their last sale price or official closing price on the principal exchange or system on which they are traded. If no sale occurs, such securities and investment companies are valued at the last bid price. Debt securities are valued at prices supplied by independent pricing services, broker/dealer-supplied valuations or matrix pricing systems. Unlisted equity securities for which market quotations are available are valued at the last sale price on valuation date, or if no sale occurs, at the last bid price. Investments in investment companies (other than those that are exchange traded) are valued at the net asset value per share on the valuation date. Short-term debt obligations maturing in sixty days or less are valued at amortized cost, which approximates market value. Securities for which market quotations are not readily available or are deemed not to reflect market value by the investment adviser are valued at fair value using methods approved by the Trust’s Board of Trustees.
B. Security Transactions and Investment Income — Security transactions are reflected as of the trade date. Realized gains and losses on sales of portfolio securities are calculated using the identified cost basis. Dividend income is recorded on the ex-dividend date, net of foreign withholding taxes, if any, which are reduced by any amounts reclaimable by the Funds, where applicable. Interest income is recorded on the basis of interest accrued, premium amortized and discount accreted.
Net investment income (other than class-specific expenses) and unrealized and realized gains or losses are allocated daily to each class of shares of the respective Fund based upon the relative proportion of net assets of each class.
C. Commission Recapture — The Funds may direct portfolio trades, subject to obtaining best execution, to various brokers who have agreed to rebate a portion of the commissions generated. Such rebates are made directly to the Funds as cash payments and are included in the net realized gain (loss) on investments in the Statements of Operations.
44
GOLDMAN SACHS GROWTH EQUITY FUNDS
2. SIGNIFICANT ACCOUNTING POLICIES (continued) |
D. Expenses — Expenses incurred by the Trust that do not specifically relate to an individual Fund of the Trust are allocated to the Funds on a straight-line and/or “pro-rata” basis depending upon the nature of the expense.
Class A, Class B and Class C shareholders of the Funds bear all expenses and fees relating to their respective Distribution and Service Plans. Service Shares bear all expenses and fees relating to their Service and Shareholder Administration Plans. Each class of shares of the Funds separately bears its respective class-specific Transfer agency fees.
E. Federal Taxes and Distributions to Shareholders — It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended (the “Code”) applicable to regulated investment companies and to distribute each year substantially all of its investment company taxable income and capital gains to its shareholders. Accordingly, no federal tax provisions are required. Dividends and distributions to shareholders are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually. Net capital losses are carried forward to future years and may be used to the extent allowed by the Code to offset any future capital gains. Utilization of capital loss carryforwards will reduce the requirement of future capital gain distributions.
The characterization of distributions to shareholders for financial reporting purposes is determined in accordance with Federal income tax rules, which may differ from generally accepted accounting principles. Therefore, the source of each Fund’s distributions may be shown in the accompanying financial statements as either from net investment income, net realized gain, or as a tax return of capital.
F. Repurchase Agreements — Repurchase agreements involve the purchase of securities subject to the seller’s agreement to repurchase them at a mutually agreed upon date and price. During the term of a repurchase agreement, the value of the underlying securities held as collateral on behalf of the Funds, including accrued interest, is required to exceed the value of the repurchase agreement, including accrued interest. If the seller defaults or becomes insolvent, realization of the collateral by the Funds may be delayed or limited and there may be a decline in the value of the collateral during the period while the Funds seek to assert their rights. The underlying securities for all repurchase agreements are held in safekeeping at the Funds’ custodian or designated subcustodians under triparty repurchase agreements.
Pursuant to exemptive relief granted by the Securities and Exchange Commission (“SEC”) and terms and conditions contained therein, the Funds, together with other registered investment companies having management or investment advisory agreements with Goldman Sachs Asset Management, L.P. (“GSAM”), or its affiliates, may transfer uninvested cash into joint accounts, the daily aggregate balance of which is invested in one or more repurchase agreements.
G. Segregation Transactions — As set forth in the prospectus, the Funds may enter into certain derivative transactions to seek to increase total return. Forward foreign currency exchange contracts, futures contracts, written options, when-issued securities and forward commitments represent examples of such transactions. As a result of entering into these transactions, the Funds are required to segregate liquid assets with a current value equal to or greater than the market value of the corresponding transactions.
45
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
3. AGREEMENTS |
GSAM, an affiliate of Goldman Sachs, serves as investment adviser pursuant to an Investment Management Agreement (the “Agreement”) with the Trust on behalf of the Funds. Under the Agreement, GSAM manages the Funds, subject to the general supervision of the Trust’s Board of Trustees.
As compensation for the services rendered pursuant to the Agreement, the assumption of the expenses related thereto and administering the Funds’ business affairs, including providing facilities, GSAM is entitled to a fee (“Management fee”) computed daily and payable monthly, equal to an annual percentage rate of each Fund’s average daily net assets.
GSAM currently receives a Management fee on a contractual basis at the following rates:
Management fee | Average Daily | |||||
Fund | Annual Rate | Net Assets | ||||
Capital Growth | 1.00 | % | First $1 Billion | |||
0.90 | Next $1 Billion | |||||
0.80 | Over $2 Billion | |||||
Strategic Growth and Concentrated Growth | 1.00 | First $1 Billion | ||||
0.90 | Next $1 Billion | |||||
0.86 | Over $2 Billion | |||||
Growth Opportunities and Small/Mid Cap Growth | 1.00 | First $2 Billion | ||||
0.90 | Over $2 Billion | |||||
GSAM has voluntarily agreed to limit certain “Other Expenses” of the Funds (excluding Management fees, Distribution and Service fees, Transfer Agency fees and expenses, Service Share fees, taxes, interest, brokerage fees and litigation, indemnification, shareholder meeting and other extraordinary expenses exclusive of any expense offset arrangements) to the extent such expenses exceed, on an annual basis, a percentage rate of the average daily net assets of each Fund. Such expense reimbursements, if any, are computed daily and paid monthly. In addition, the Funds are not obligated to reimburse GSAM for prior fiscal year expense reimbursements, if any.
The Other Expense limitations of the Capital Growth, Strategic Growth, Concentrated Growth, Growth Opportunities and Small/Mid Cap Growth Funds as an annual percentage rate of average daily net assets are 0.004%, 0.004%, 0.044%, 0.114% and 0.064%, respectively.
The Trust, on behalf of each Fund, has adopted Distribution and Service Plans (the “Plans”). Under the Plans, Goldman Sachs and/or authorized dealers are entitled to a monthly fee for distribution services equal to, on an annual basis, 0.25%, 0.75% and 0.75% of each Fund’s average daily net assets attributable to Class A, Class B and Class C Shares, respectively. Additionally, Goldman Sachs and/or authorized dealers are entitled to receive under the Plans a separate fee for personal and account maintenance services equal to, on an annual basis, 0.25% of each Fund’s average daily net assets attributable to Class B and Class C Shares.
46
GOLDMAN SACHS GROWTH EQUITY FUNDS
3. AGREEMENTS (continued) |
Goldman Sachs serves as Distributor of the shares of the Funds pursuant to a Distribution Agreement. Goldman Sachs may retain a portion of the Class A sales load and Class B and Class C contingent deferred sales charges. During the six months ended February 28, 2007, Goldman Sachs advised the Funds that it retained the following approximate amounts:
Contingent Deferred | ||||||||||||
Sales Load | Sales Charge | |||||||||||
Fund | Class A | Class B | Class C | |||||||||
Capital Growth | $ | 78,300 | $ | 800 | $ | 100 | ||||||
Strategic Growth | 7,000 | — | — | |||||||||
Concentrated Growth | 1,300 | — | — | |||||||||
Growth Opportunities | 52,600 | 100 | — | |||||||||
Small/Mid Cap Growth | 8,500 | — | — | |||||||||
Goldman Sachs also serves as the Transfer Agent of the Funds for a fee. The fees charged for such transfer agency services are calculated daily and payable monthly at an annual rate as follows: 0.19% of the average daily net assets for Class A, Class B and Class C Shares and 0.04% of the average daily net assets for Institutional and Service Shares.
The Trust, on behalf of each Fund, has adopted a Service Plan and Shareholder Administration Plan for Service Shares. These plans allow for Service Shares to compensate service organizations for providing varying levels of personal and account administration and shareholder administration services to their customers who are beneficial owners of such shares. The Service Plan and Shareholder Administration Plan provides for compensation to the service organizations in an amount equal to, on an annual basis, 0.25% and 0.25%, respectively, of the average daily net assets of the Service Shares.
For the six months ended February 28, 2007, GSAM has voluntarily agreed to waive certain fees and reimburse other expenses. In addition, the Funds have entered into certain offset arrangements with the custodian and the transfer agent resulting in a reduction in the Funds’ expenses. These expense reductions were as follows (in thousands):
Expense Credits | ||||||||||||||||
Other Expense | Custody | Transfer | Total Expense | |||||||||||||
Fund | Reimbursement | Fee | agent Fee | Reductions | ||||||||||||
Capital Growth | $ | 209 | $ | 4 | $ | 41 | $ | 254 | ||||||||
Strategic Growth | 85 | 1 | 4 | 90 | ||||||||||||
Concentrated Growth | 79 | 2 | 2 | 83 | ||||||||||||
Growth Opportunities | — | 7 | 33 | 40 | ||||||||||||
Small/Mid Cap Growth | 24 | 2 | 2 | 28 | ||||||||||||
47
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
3. AGREEMENTS (continued) |
As of February 28, 2007, the amounts owed to affiliates were as follows (in thousands):
Management | Distribution and | Transfer | Over | |||||||||||||||||
Fund | Fees | Service Fees | Agent Fees | Reimbursement | Total | |||||||||||||||
Capital Growth | $ | 1,330 | $ | 374 | $ | 229 | $ | 52 | $ | 1,985 | ||||||||||
Strategic Growth | 240 | 39 | 27 | 79 | 385 | |||||||||||||||
Concentrated Growth | 169 | 16 | 16 | 43 | 244 | |||||||||||||||
Growth Opportunities | 1,486 | 319 | 187 | — | 1,992 | |||||||||||||||
Small/Mid Cap Growth | 70 | 22 | 7 | 69 | 168 | |||||||||||||||
48
GOLDMAN SACHS GROWTH EQUITY FUNDS
4. PORTFOLIO SECURITIES TRANSACTIONS |
The cost of purchases and proceeds from sales and maturities of long-term securities for the six months ended February 28, 2007, were as follows:
Fund | Purchases | Sales and Maturities | ||||||
Capital Growth | $ | 262,904,488 | $ | 390,721,577 | ||||
Strategic Growth | 65,447,782 | 113,780,933 | ||||||
Concentrated Growth | 64,491,504 | 49,483,814 | ||||||
Growth Opportunities | 501,917,536 | 726,262,351 | ||||||
Small/Mid Cap Growth | 25,588,083 | 31,625,471 | ||||||
For the six months ended February 28, 2007, Goldman Sachs earned approximately $14,900, $5,300, $7,800, $29,700 and $540 of brokerage commissions from portfolio transactions, executed on behalf of the Capital Growth, Strategic Growth, Concentrated Growth, Growth Opportunities and Small/Mid Cap Growth Funds, respectively.
An investment by the Fund of at least 5% of the voting securities of an issuer makes that issuer an affiliated person (as defined in the Act) of the Trust and an affiliate (as defined in Rule 6-02(a) of Regulation S-X) of the Trust. The following table provides information about the investments by the Growth Opportunities Fund in shares of an issuer of which the Trust is an affiliate for the six months ended February 28, 2007.
Number of | Number of | |||||||||||||||||||||||
Shares Held | Shares | Shares | Shares Held | |||||||||||||||||||||
Beginning of | Bought | Sold | End of | Value at End | ||||||||||||||||||||
Name of Affiliated Issuer | Period (in 000’s) | (in 000’s) | (in 000’s) | Period (in 000’s) | of Period | Income | ||||||||||||||||||
Entravision Communications Corp. | 3,744 | — | 33 | 3,711 | $ | 33,511,052 | $ | — | ||||||||||||||||
49
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
5. SECURITIES LENDING |
Pursuant to exemptive relief granted by the SEC and the terms and conditions contained therein, the Funds may lend their securities through a securities lending agent, Boston Global Advisers (“BGA”) — a wholly owned subsidiary of Goldman Sachs, to certain qualified borrowers including Goldman Sachs and affiliates. In accordance with the Funds’ security lending procedures, the loans are collateralized at all times with cash and/or securities with a market value at least equal to the securities on loan. The market value of the loaned securities is determined at the close of business of the Funds at their last sale price or official closing price on the principal exchange or system on which they are traded and any additional required collateral is delivered to the Funds on the next business day. As with other extensions of credit, the Funds bear the risk of delay on recovery or loss of rights in the collateral should the borrower of the securities fail financially.
The Funds invest the cash collateral received in connection with securities lending transactions in the Enhanced Portfolio of Boston Global Investment Trust, a Delaware statutory trust. The Enhanced Portfolio is exempt from registration under Section 3(c)(7) of the Act and is managed by GSAM, for which GSAM receives an investment advisory fee of up to 0.10% of the average daily net assets of the Enhanced Portfolio. The Enhanced Portfolio invests in high quality money market instruments. The Funds bear the risk of incurring a loss from the investment of cash collateral due to either credit or market factors.
Both the Funds and BGA receive compensation relating to the lending of the Funds’ securities. The amounts earned by the Funds for the six months ended February 28, 2007, are reported parenthetically under Investment Income on the Statements of Operations.
The table below details securities lending activity as of, and for the six months ended February 28, 2007:
Earnings Received | ||||||||||||
Earnings of BGA | by the Funds | Amount Payable to | ||||||||||
Relating to Securities | From Lending to | Goldman Sachs | ||||||||||
Loaned for the | Goldman Sachs for the | Upon Return of | ||||||||||
six months ended | six months ended | Securities Loaned as of | ||||||||||
Fund | February 28, 2007 | February 28, 2007 | February 28, 2007 | |||||||||
Capital Growth | $ | 8,627 | $ | 377 | $ | 21,411,250 | ||||||
Strategic Growth | 172 | — | — | |||||||||
Concentrated Growth | 73 | — | — | |||||||||
Growth Opportunities | 38,590 | 13,373 | 71,867,750 | |||||||||
Small/Mid Cap Growth | 13,031 | 7,473 | 804,300 | |||||||||
6. LINE OF CREDIT FACILITY |
The Funds participate in a $400,000,000 committed, unsecured revolving line of credit facility together with other registered investment companies having management or investment advisory agreements with GSAM or affiliates. Under the most restrictive arrangement, the Funds must own securities having a market value in excess of 300% of each Fund’s total bank borrowings. This facility is to be used solely for temporary or emergency purposes. The interest rate on borrowings is based on the federal funds rate. The committed facility also requires a fee to be paid by the Funds based on the amount of the commitment that has not been utilized. For the six months ended February 28, 2007, the Funds did not have any borrowings under this facility.
50
GOLDMAN SACHS GROWTH EQUITY FUNDS
7. TAX INFORMATION |
As of the Funds’ most recent fiscal year end, August 31, 2006, the Funds’ capital loss carryforwards and certain timing differences on a tax basis were as follows:
Capital | Strategic | Concentrated | Growth | Small/Mid Cap | |||||||||||||||||
Growth | Growth | Growth | Opportunities | Growth | |||||||||||||||||
Capital loss carryforward:* | |||||||||||||||||||||
Expiring 2010 | $ | — | $ | (23,295,339 | ) | $ | — | $ | — | $ | — | ||||||||||
Expiring 2011 | (222,589,151 | ) | (32,615,744 | ) | — | — | — | ||||||||||||||
Expiring 2012 | — | (13,060,848 | ) | — | — | — | |||||||||||||||
Expiring 2013 | — | (2,826,194 | ) | — | — | — | |||||||||||||||
Total capital loss carryforward | (222,589,151 | ) | (71,798,125 | ) | — | — | — | ||||||||||||||
Timing differences (post October losses) | (11,326 | ) | (385 | ) | (133 | ) | — | (2,234,336 | ) | ||||||||||||
* | Expiration occurs on August 31 of the year indicated. Due to Fund mergers, utilization of these losses may be limited under the Internal Revenue Code. |
At February 28, 2007, the Funds’ aggregate security unrealized gains and losses based on cost for U.S. federal income tax purposes was as follows:
Small/ Mid | ||||||||||||||||||||
Capital | Strategic | Concentrated | Growth | Cap | ||||||||||||||||
Growth | Growth | Growth | Opportunities | Growth | ||||||||||||||||
Tax Cost | $ | 1,398,500,364 | $ | 256,015,895 | $ | 197,879,588 | $ | 1,654,299,767 | $ | 86,093,098 | ||||||||||
Gross unrealized gain | 505,174,355 | 56,840,378 | 32,969,909 | 602,710,640 | 18,569,646 | |||||||||||||||
Gross unrealized loss | (25,827,919 | ) | (8,531,978 | ) | (4,166,489 | ) | (57,920,319 | ) | (3,629,448 | ) | ||||||||||
Net unrealized security gain | $ | 479,346,436 | $ | 48,308,400 | $ | 28,803,420 | $ | 544,790,321 | $ | 14,940,198 | ||||||||||
The difference between book-basis and tax-basis unrealized gains (losses) is attributable primarily to wash sales, differences related to the tax treatment of partnerships investments and return of capital distributions from underlying fund investments.
51
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
8. OTHER MATTERS |
Legal Proceedings — Purported class and derivative action lawsuits were filed in April and May 2004 in the United States District Court for the Southern District of New York against the Goldman Sachs Group, Inc. (“GSG”), GSAM and certain related parties, including certain Goldman Sachs Funds including these Funds, and the Trustees and Officers of the Trust. In June 2004, these lawsuits were consolidated into one action and in November 2004 a consolidated and amended complaint was filed against GSG, GSAM, Goldman Sachs Asset Management International (“GSAMI”), Goldman Sachs and certain related parties including certain Goldman Sachs Funds and the Trustees and Officers of the Trust. These Funds along with certain other investment portfolios of the Trust, were named as nominal defendants in the amended complaint. Plaintiffs filed a second amended consolidated complaint on April 15, 2005. The second amended consolidated complaint alleges violations of the Act and the Investment Advisers Act of 1940. The complaint also asserts claims involving common law breaches of fiduciary duty and unjust enrichment. The complaint alleges, among other things, that between April 2, 1999 and January 9, 2004 (the “Class Period”), GSAM and other defendants made improper and excessive brokerage commission and other payments to brokers that sold shares of the Goldman Sachs Funds and omitted statements of fact in registration statements and reports filed pursuant to the Act which were necessary to prevent such registration statements and reports from being materially false and misleading. The complaint further alleges that the Goldman Sachs Funds paid excessive and improper advisory fees to Goldman Sachs. The complaint also alleges that GSAM and GSAMI used Rule 12b-1 fees for improper purposes and made improper use of soft dollars. The complaint further alleges that the Trust’s Officers and Trustees breached their fiduciary duties in connection with the foregoing. On January 13, 2006, all claims against the defendants were dismissed by the U.S. District Court. On February 22, 2006, the plaintiffs appealed this decision. By agreement, the plaintiffs subsequently withdrew their appeal without prejudice but reserved their right to reactivate their appeal pending a decision by the circuit court of appeals in similar litigation. Plaintiffs did not reactivate their appeal by the deadline.
Based on currently available information, GSAM and GSAMI believe that the likelihood that the pending purported class and derivative action lawsuit will have a material adverse financial impact on the Funds is remote, and the pending action is not likely to materially affect their ability to provide investment management services to their clients, including the Goldman Sachs Funds.
52
GOLDMAN SACHS GROWTH EQUITY FUNDS
8. OTHER MATTERS (continued) |
New Accounting Pronouncements — On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48 “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Funds’ tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. On December 22, 2006, the SEC delayed the implementation of this ruling such that it must be incorporated no later than February 29, 2008. At this time, the investment adviser is evaluating the implications of FIN 48 and its impact in the financial statements has not yet been determined.
On September 15, 2006, the FASB released Statement Financial Accounting Standard No. 157 “Fair Value Measurement” (“FAS 157”) which provides enhanced guidance for using fair value to measure assets and liabilities. The standard requires companies to provide expanded information about the assets and liabilities measured at fair value and the potential effect of these fair valuations of an entity’s financial performance. The standard does not expand the use of fair value in any new circumstances, but provides clarification on acceptable fair valuation methods and applications. FAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. The investment adviser does not believe the adoption of FAS 157 will impact the amounts reported in the financial statements, however, additional disclosures will be required.
53
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
9. SUMMARY OF SHARE TRANSACTIONS |
Share activity is as follows:
Capital Growth Fund | ||||||||||||||||
For the Six Months Ended | ||||||||||||||||
February 28, 2007 | For the Year Ended | |||||||||||||||
(Unaudited) | August 31, 2006 | |||||||||||||||
Shares | Dollars | Shares | Dollars | |||||||||||||
Class A Shares | ||||||||||||||||
Shares sold | 3,672,902 | $ | 80,485,093 | 8,782,498 | $ | 181,312,854 | ||||||||||
Shares converted from Class B(a) | 275,205 | 5,869,611 | 768,782 | 15,761,462 | ||||||||||||
Reinvestment of dividends and distributions | — | — | 40,543 | 842,078 | ||||||||||||
Shares repurchased | (7,189,663 | ) | (158,155,017 | ) | (15,561,726 | ) | (320,944,763 | ) | ||||||||
(3,241,556 | ) | (71,800,313 | ) | (5,969,903 | ) | (123,028,369 | ) | |||||||||
Class B Shares | ||||||||||||||||
Shares sold | 50,045 | 1,010,821 | 167,851 | 3,214,704 | ||||||||||||
Shares converted to Class A(a) | (298,721 | ) | (5,869,611 | ) | (830,768 | ) | (15,761,462 | ) | ||||||||
Reinvestment of dividends and distributions | — | — | — | — | ||||||||||||
Shares repurchased | (949,718 | ) | (19,001,788 | ) | (2,906,385 | ) | (55,453,870 | ) | ||||||||
(1,198,394 | ) | (23,860,578 | ) | (3,569,302 | ) | (68,000,628 | ) | |||||||||
Class C Shares | ||||||||||||||||
Shares sold | 245,769 | 4,971,859 | 629,512 | 12,046,930 | ||||||||||||
Reinvestment of dividends and distributions | — | — | — | — | ||||||||||||
Shares repurchased | (700,736 | ) | (14,173,052 | ) | (1,383,934 | ) | (26,407,224 | ) | ||||||||
(454,967 | ) | (9,201,193 | ) | (754,422 | ) | (14,360,294 | ) | |||||||||
Institutional Shares | ||||||||||||||||
Shares sold | 1,247,732 | 28,316,486 | 2,854,549 | 60,699,399 | ||||||||||||
Reinvestment of dividends and distributions | — | — | 40,111 | 855,575 | ||||||||||||
Shares repurchased | (1,310,608 | ) | (29,766,942 | ) | (3,313,270 | ) | (70,473,332 | ) | ||||||||
(62,876 | ) | (1,450,456 | ) | (418,610 | ) | (8,918,358 | ) | |||||||||
Service Shares | ||||||||||||||||
Shares sold | 41,876 | 917,383 | 144,552 | 2,949,265 | ||||||||||||
Reinvestment of dividends and distributions | — | — | 618 | 12,689 | ||||||||||||
Shares repurchased | (101,984 | ) | (2,133,846 | ) | (134,768 | ) | (2,755,881 | ) | ||||||||
(60,108 | ) | (1,216,463 | ) | 10,402 | 206,073 | |||||||||||
NET INCREASE (DECREASE) | (5,017,901 | ) | $ | (107,529,003 | ) | (10,701,835 | ) | $ | (214,101,576 | ) | ||||||
(a) | Class B Shares automatically convert into Class A Shares at the end of the calendar quarter that is eight years after the initial purchase date of either the Fund or another Goldman Sachs Fund. |
54
GOLDMAN SACHS GROWTH EQUITY FUNDS
Strategic Growth Fund | Concentrated Growth Fund | |||||||||||||||||||||||||||||||
For the Six Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||||||
February 28, 2007 | For the Year Ended | February 28, 2007 | For the Year Ended | |||||||||||||||||||||||||||||
(Unaudited) | August 31, 2006 | (Unaudited) | August 31, 2006 | |||||||||||||||||||||||||||||
Shares | Dollars | Shares | Dollars | Shares | Dollars | Shares | Dollars | |||||||||||||||||||||||||
1,261,192 | $ | 12,040,946 | 4,573,721 | $ | 41,414,126 | 874,246 | $ | 11,943,205 | 1,886,676 | $ | 24,787,642 | |||||||||||||||||||||
11,665 | 106,217 | 18,306 | 161,150 | — | — | 1,459 | 19,681 | |||||||||||||||||||||||||
— | — | — | — | 162,191 | 2,222,019 | 106,245 | 1,389,688 | |||||||||||||||||||||||||
(1,694,211 | ) | (16,127,484 | ) | (9,275,092 | ) | (82,162,940 | ) | (801,705 | ) | (10,931,545 | ) | (1,471,765 | ) | (19,095,869 | ) | |||||||||||||||||
(421,354 | ) | (3,980,321 | ) | (4,683,065 | ) | (40,587,664 | ) | 234,732 | 3,233,679 | 522,615 | 7,101,142 | |||||||||||||||||||||
21,408 | 196,614 | 68,096 | 587,014 | 13,188 | 174,902 | 28,861 | 372,198 | |||||||||||||||||||||||||
(12,330 | ) | (106,217 | ) | (19,230 | ) | (161,150 | ) | — | ��� | (1,499 | ) | (19,681 | ) | |||||||||||||||||||
— | — | — | — | 317 | 4,203 | 204 | 2,603 | |||||||||||||||||||||||||
(151,329 | ) | (1,369,541 | ) | (379,085 | ) | (3,253,514 | ) | (94 | ) | (1,264 | ) | (6,610 | ) | (81,402 | ) | |||||||||||||||||
(142,251 | ) | (1,279,144 | ) | (330,219 | ) | (2,827,650 | ) | 13,411 | 177,841 | 20,956 | 273,718 | |||||||||||||||||||||
93,564 | 858,656 | 323,341 | 2,774,266 | 17,148 | 226,573 | 10,502 | 135,586 | |||||||||||||||||||||||||
— | — | — | — | 1,455 | 19,236 | 731 | 9,301 | |||||||||||||||||||||||||
(195,155 | ) | (1,768,378 | ) | (478,077 | ) | (4,102,886 | ) | (3,659 | ) | (48,391 | ) | (3,151 | ) | (39,875 | ) | |||||||||||||||||
(101,591 | ) | (909,722 | ) | (154,736 | ) | (1,328,620 | ) | 14,944 | 197,418 | 8,082 | 105,012 | |||||||||||||||||||||
1,702,527 | 16,630,310 | 9,263,230 | 85,639,740 | 1,549,944 | 21,619,397 | 3,978,895 | 52,537,066 | |||||||||||||||||||||||||
— | — | 13,430 | 124,896 | 324,857 | 4,515,517 | 176,516 | 2,331,774 | |||||||||||||||||||||||||
(5,944,343 | ) | (58,655,748 | ) | (6,826,767 | ) | (63,290,522 | ) | (670,863 | ) | (9,445,169 | ) | (1,840,865 | ) | (24,287,940 | ) | |||||||||||||||||
(4,241,816 | ) | (42,025,438 | ) | 2,449,893 | 22,474,114 | 1,203,938 | 16,689,745 | 2,314,546 | 30,580,900 | |||||||||||||||||||||||
55 | 512 | 203 | 1,825 | — | — | 6 | 75 | |||||||||||||||||||||||||
— | — | — | — | 6 | 74 | 3 | 48 | |||||||||||||||||||||||||
(1,109 | ) | (10,840 | ) | (28,604 | ) | (251,517 | ) | — | — | (6 | ) | (77 | ) | |||||||||||||||||||
(1,054 | ) | (10,328 | ) | (28,401 | ) | (249,692 | ) | 6 | 74 | 3 | 46 | |||||||||||||||||||||
(4,908,066 | ) | $ | (48,204,953 | ) | (2,746,528 | ) | $ | (22,519,512 | ) | 1,467,031 | $ | 20,298,757 | 2,866,202 | $ | 38,060,818 | |||||||||||||||||
55
GOLDMAN SACHS GROWTH EQUITY FUNDS
Notes to Financial Statements (continued)
February 28, 2007 (Unaudited)
9. SUMMARY OF SHARE TRANSACTIONS (continued) |
Share activity is as follows:
Growth Opportunities Fund | ||||||||||||||||
For the Six Months Ended | ||||||||||||||||
February 28, 2007 | For the Year Ended | |||||||||||||||
(Unaudited) | August 31, 2006 | |||||||||||||||
Shares | Dollars | Shares | Dollars | |||||||||||||
Class A Shares | ||||||||||||||||
Shares sold | 4,527,866 | $ | 99,957,373 | 15,125,829 | $ | 333,944,344 | ||||||||||
Shares converted from Class B(a) | 26,049 | 557,925 | 93,592 | 2,053,034 | ||||||||||||
Reinvestment of dividends and distributions | 1,972,117 | 43,919,037 | 2,114,582 | 45,971,012 | ||||||||||||
Shares repurchased | (10,039,341 | ) | (220,852,352 | ) | (15,859,486 | ) | (343,809,620 | ) | ||||||||
(3,513,309 | ) | (76,418,017 | ) | 1,474,517 | 38,158,770 | |||||||||||
Class B Shares | ||||||||||||||||
Shares sold | 48,591 | 1,017,521 | 279,880 | 5,900,487 | ||||||||||||
Shares converted to Class A(a) | (27,461 | ) | (557,925 | ) | (98,022 | ) | (2,053,034 | ) | ||||||||
Reinvestment of dividends and distributions | 149,398 | 3,149,317 | 191,739 | 3,986,244 | ||||||||||||
Shares repurchased | (646,857 | ) | (13,557,810 | ) | (1,155,490 | ) | (23,996,933 | ) | ||||||||
(476,329 | ) | (9,948,897 | ) | (781,893 | ) | (16,163,236 | ) | |||||||||
Class C Shares | ||||||||||||||||
Shares sold | 585,692 | 12,192,793 | 1,709,260 | 35,722,641 | ||||||||||||
Reinvestment of dividends and distributions | 204,661 | 4,281,505 | 215,290 | 4,443,583 | ||||||||||||
Shares repurchased | (1,193,730 | ) | (24,908,338 | ) | (1,462,288 | ) | (30,191,538 | ) | ||||||||
(403,377 | ) | (8,434,040 | ) | 462,262 | 9,974,686 | |||||||||||
Institutional Shares | ||||||||||||||||
Shares sold | 4,654,182 | 106,857,030 | 23,416,761 | 532,255,006 | ||||||||||||
Reinvestment of dividends and distributions | 1,456,560 | 33,515,434 | 1,658,823 | 37,041,517 | ||||||||||||
Shares repurchased | (8,223,648 | ) | (188,510,358 | ) | (21,613,257 | ) | (470,082,417 | ) | ||||||||
(2,112,906 | ) | (48,137,894 | ) | 3,462,327 | 99,214,106 | |||||||||||
Service Shares | ||||||||||||||||
Shares sold | 143,134 | 3,154,068 | 299,768 | 6,553,548 | ||||||||||||
Reinvestment of dividends and distributions | 4,976 | 109,777 | 7,443 | 160,483 | ||||||||||||
Shares repurchased | (188,770 | ) | (4,106,300 | ) | (149,797 | ) | (3,240,366 | ) | ||||||||
(40,660 | ) | (842,455 | ) | 157,414 | 3,473,665 | |||||||||||
NET INCREASE (DECREASE) | (6,546,581 | ) | $ | (143,781,303 | ) | 4,774,627 | $ | 134,657,991 | ||||||||
(a) | Class B Shares automatically convert into Class A Shares at the end of the calendar quarter that is eight years after the initial purchase date of either the Fund or another Goldman Sachs Fund. |
56
GOLDMAN SACHS GROWTH EQUITY FUNDS
Small/Mid Cap Growth Fund | ||||||||||||||||
For the Six Months Ended | ||||||||||||||||
February 28, 2007 | For the Year Ended | |||||||||||||||
(Unaudited) | August 31, 2006 | |||||||||||||||
Shares | Dollars | Shares | Dollars | |||||||||||||
1,304,339 | $ | 15,007,598 | 8,960,740 | $ | 101,662,661 | |||||||||||
1,749 | 20,564 | 271 | 3,142 | |||||||||||||
— | — | 2,338 | 24,693 | |||||||||||||
(1,630,630 | ) | (18,531,715 | ) | (2,095,481 | ) | (22,619,283 | ) | |||||||||
(324,542 | ) | (3,503,553 | ) | 6,867,868 | 79,071,213 | |||||||||||
20,469 | 232,852 | 169,026 | 1,885,817 | |||||||||||||
(1,774 | ) | (20,564 | ) | (273 | ) | (3,142 | ) | |||||||||
— | — | 163 | 1,714 | |||||||||||||
(9,884 | ) | (112,989 | ) | (23,730 | ) | (245,115 | ) | |||||||||
8,811 | 99,299 | 145,186 | 1,639,274 | |||||||||||||
47,879 | 559,523 | 615,616 | 6,901,956 | |||||||||||||
— | — | 56 | 588 | |||||||||||||
(190,280 | ) | (2,219,727 | ) | (40,894 | ) | (422,027 | ) | |||||||||
(142,401 | ) | (1,660,204 | ) | 574,778 | 6,480,517 | |||||||||||
26,212 | 301,561 | 127,066 | 1,392,282 | |||||||||||||
— | — | 5,730 | 60,449 | |||||||||||||
(21,319 | ) | (238,331 | ) | (524,246 | ) | (6,018,290 | ) | |||||||||
4,893 | 63,230 | (391,450 | ) | (4,565,559 | ) | |||||||||||
4,929 | 57,541 | 14,426 | 159,377 | |||||||||||||
— | — | 10 | 109 | |||||||||||||
(3,350 | ) | (39,257 | ) | (664 | ) | (6,855 | ) | |||||||||
1,579 | 18,284 | 13,772 | 152,631 | |||||||||||||
(451,660 | ) | $ | (4,982,944 | ) | 7,210,154 | $ | 82,778,076 | |||||||||
57
GOLDMAN SACHS CAPITAL GROWTH FUND
Financial Highlights
Selected Data for a Share Outstanding Throughout Each Period
Income (loss) from | Distributions | |||||||||||||||||||||||||||
investment operations | to shareholders | |||||||||||||||||||||||||||
Net asset | ||||||||||||||||||||||||||||
value, | Net | Net realized | Total from | From net | From net | |||||||||||||||||||||||
beginning | investment | and unrealized | investment | investment | realized | |||||||||||||||||||||||
Year - Share Class | of period | income (loss)(a) | gain (loss) | operations | income | gains | ||||||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||||||
2007 - A | $ | 20.62 | $ | (0.05 | ) | $ | 1.67 | $ | 1.62 | $ | — | $ | — | |||||||||||||||
2007 - B | 19.03 | (0.13 | ) | 1.53 | 1.40 | — | — | |||||||||||||||||||||
2007 - C | 18.99 | (0.12 | ) | 1.53 | 1.41 | — | — | |||||||||||||||||||||
2007 - Institutional | 21.24 | (0.01 | ) | 1.72 | 1.71 | — | — | |||||||||||||||||||||
2007 - Service | 20.38 | (0.06 | ) | 1.64 | 1.58 | — | — | |||||||||||||||||||||
FOR THE YEARS ENDED AUGUST 31, | ||||||||||||||||||||||||||||
2006 - A | 20.06 | (0.08 | ) | 0.65 | 0.57 | (0.01 | ) | — | ||||||||||||||||||||
2006 - B | 18.63 | (0.22 | ) | 0.62 | 0.40 | — | — | |||||||||||||||||||||
2006 - C | 18.60 | (0.22 | ) | 0.61 | 0.39 | — | — | |||||||||||||||||||||
2006 - Institutional | 20.65 | — | 0.68 | 0.68 | (0.09 | ) | — | |||||||||||||||||||||
2006 - Service | 19.86 | (0.10 | ) | 0.65 | 0.55 | (0.03 | ) | — | ||||||||||||||||||||
2005 - A | 18.31 | 0.05 | (d) | 1.70 | (e) | 1.75 | — | — | ||||||||||||||||||||
2005 - B | 17.13 | (0.09 | )(d) | 1.59 | (e) | 1.50 | — | — | ||||||||||||||||||||
2005 - C | 17.10 | (0.09 | )(d) | 1.59 | (e) | 1.50 | — | — | ||||||||||||||||||||
2005 - Institutional | 18.77 | 0.13 | (d) | 1.75 | (e) | 1.88 | — | — | ||||||||||||||||||||
2005 - Service | 18.14 | 0.01 | (d) | 1.71 | (e) | 1.72 | — | — | ||||||||||||||||||||
2004 - A | 17.07 | (0.05 | ) | 1.29 | 1.24 | — | — | |||||||||||||||||||||
2004 - B | 16.09 | (0.17 | ) | 1.21 | 1.04 | — | — | |||||||||||||||||||||
2004 - C | 16.07 | (0.17 | ) | 1.20 | 1.03 | — | — | |||||||||||||||||||||
2004 - Institutional | 17.44 | 0.03 | 1.30 | 1.33 | — | — | ||||||||||||||||||||||
2004 - Service | 16.94 | (0.07 | ) | 1.27 | 1.20 | — | — | |||||||||||||||||||||
2003 - A | 15.44 | — | (c) | 1.63 | 1.63 | — | — | |||||||||||||||||||||
2003 - B | 14.66 | (0.11 | ) | 1.54 | 1.43 | — | — | |||||||||||||||||||||
2003 - C | 14.64 | (0.11 | ) | 1.54 | 1.43 | — | — | |||||||||||||||||||||
2003 - Institutional | 15.71 | 0.06 | 1.67 | 1.73 | — | — | ||||||||||||||||||||||
2003 - Service | 15.33 | (0.01 | ) | 1.62 | 1.61 | — | — | |||||||||||||||||||||
2002 - A | 19.76 | (0.05 | ) | (4.24 | ) | (4.29 | ) | — | (0.03 | ) | ||||||||||||||||||
2002 - B | 18.90 | (0.18 | ) | (4.03 | ) | (4.21 | ) | — | (0.03 | ) | ||||||||||||||||||
2002 - C | 18.88 | (0.18 | ) | (4.03 | ) | (4.21 | ) | — | (0.03 | ) | ||||||||||||||||||
2002 - Institutional | 20.02 | 0.02 | (4.30 | ) | (4.28 | ) | — | (0.03 | ) | |||||||||||||||||||
2002 - Service | 19.63 | (0.07 | ) | (4.20 | ) | (4.27 | ) | — | (0.03 | ) | ||||||||||||||||||
(a) | Calculated based on the average shares outstanding methodology. |
(b) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
(c) | Amount is less than $0.005 per share. |
(d) | Reflects income recognized from special dividends which amounted to $0.11 per share and 0.56% of average net assets. |
(e) | Reflects an increase of $0.01 due to payments by affiliates during the period to reimburse certain security claims. |
(f) | Annualized. |
The accompanying notes are an integral part of these financial statements.
58
GOLDMAN SACHS CAPITAL GROWTH FUND
Ratios assuming no | ||||||||||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||
Net assets, | Ratio of | net investment | Ratio of | net investment | ||||||||||||||||||||||||||||||
Net asset | at end of | net expenses | income (loss) | total expenses | income (loss) | Portfolio | ||||||||||||||||||||||||||||
value, end | Total | period | to average | to average | to average | to average | turnover | |||||||||||||||||||||||||||
of period | return(b) | (in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||||||||
$ | 22.24 | 7.86 | % | $ | 1,318,700 | 1.39 | %(f) | (0.50 | )%(f) | 1.42 | %(f) | (0.53 | )%(f) | 15 | % | |||||||||||||||||||
20.43 | 7.36 | 78,736 | 2.14 | (f) | (1.25 | )(f) | 2.17 | (f) | (1.28 | )(f) | 15 | |||||||||||||||||||||||
20.40 | 7.42 | 64,334 | 2.14 | (f) | (1.25 | )(f) | 2.17 | (f) | (1.28 | )(f) | 15 | |||||||||||||||||||||||
22.95 | 8.05 | 292,744 | 0.99 | (f) | (0.09 | )(f) | 1.02 | (f) | (0.12 | )(f) | 15 | |||||||||||||||||||||||
21.96 | 7.75 | 9,812 | 1.49 | (f) | (0.59 | )(f) | 1.52 | (f) | (0.62 | )(f) | 15 | |||||||||||||||||||||||
20.62 | 2.86 | 1,289,843 | 1.39 | (0.41 | ) | 1.44 | (0.45 | ) | 51 | |||||||||||||||||||||||||
19.03 | 2.15 | 96,106 | 2.14 | (1.16 | ) | 2.19 | (1.21 | ) | 51 | |||||||||||||||||||||||||
18.99 | 2.10 | 68,528 | 2.14 | (1.16 | ) | 2.19 | (1.21 | ) | 51 | |||||||||||||||||||||||||
21.24 | 3.31 | 272,295 | 0.99 | (0.01 | ) | 1.04 | (0.05 | ) | 51 | |||||||||||||||||||||||||
20.38 | 2.76 | 10,330 | 1.49 | (0.51 | ) | 1.54 | (0.55 | ) | 51 | |||||||||||||||||||||||||
20.06 | 9.56 | 1,374,264 | 1.39 | 0.24 | (d) | 1.45 | 0.18 | (d) | 34 | |||||||||||||||||||||||||
18.63 | 8.76 | 160,575 | 2.14 | (0.48 | )(d) | 2.20 | (0.54 | )(d) | 34 | |||||||||||||||||||||||||
18.60 | 8.77 | 81,132 | 2.14 | (0.49 | )(d) | 2.20 | (0.55 | )(d) | 34 | |||||||||||||||||||||||||
20.65 | 10.02 | 273,418 | 0.99 | 0.68 | (d) | 1.05 | 0.62 | (d) | 34 | |||||||||||||||||||||||||
19.86 | 9.48 | 9,858 | 1.49 | 0.04 | (d) | 1.55 | (0.02 | )(d) | 34 | |||||||||||||||||||||||||
18.31 | 7.26 | 1,343,848 | 1.39 | (0.26 | ) | 1.47 | (0.34 | ) | 43 | |||||||||||||||||||||||||
17.13 | 6.46 | 196,910 | 2.14 | (1.01 | ) | 2.22 | (1.09 | ) | 43 | |||||||||||||||||||||||||
17.10 | 6.41 | 89,086 | 2.14 | (1.01 | ) | 2.22 | (1.09 | ) | 43 | |||||||||||||||||||||||||
18.77 | 7.63 | 289,239 | 0.99 | 0.14 | 1.07 | 0.06 | 43 | |||||||||||||||||||||||||||
18.14 | 7.08 | 5,592 | 1.49 | (0.36 | ) | 1.57 | (0.44 | ) | 43 | |||||||||||||||||||||||||
17.07 | 10.56 | 1,483,768 | 1.40 | 0.00 | 1.48 | (0.08 | ) | 17 | ||||||||||||||||||||||||||
16.09 | 9.75 | 226,663 | 2.15 | (0.74 | ) | 2.23 | (0.82 | ) | 17 | |||||||||||||||||||||||||
16.07 | 9.77 | 100,027 | 2.15 | (0.74 | ) | 2.23 | (0.82 | ) | 17 | |||||||||||||||||||||||||
17.44 | 11.01 | 303,840 | 1.00 | 0.41 | 1.08 | 0.33 | 17 | |||||||||||||||||||||||||||
16.94 | 10.50 | 5,985 | 1.50 | (0.10 | ) | 1.58 | (0.18 | ) | 17 | |||||||||||||||||||||||||
15.44 | (21.74 | ) | 1,388,868 | 1.43 | (0.29 | ) | 1.47 | (0.33 | ) | 11 | ||||||||||||||||||||||||
14.66 | (22.31 | ) | 238,335 | 2.18 | (1.04 | ) | 2.22 | (1.08 | ) | 11 | ||||||||||||||||||||||||
14.64 | (22.33 | ) | 101,783 | 2.18 | (1.04 | ) | 2.22 | (1.08 | ) | 11 | ||||||||||||||||||||||||
15.71 | (21.41 | ) | 316,020 | 1.03 | 0.11 | 1.07 | 0.07 | 11 | ||||||||||||||||||||||||||
15.33 | (21.78 | ) | 5,976 | 1.53 | (0.39 | ) | 1.57 | (0.43 | ) | 11 | ||||||||||||||||||||||||
59
GOLDMAN SACHS STRATEGIC GROWTH FUND
Financial Highlights
Selected Data for a Share Outstanding Throughout Each Period
Income (loss) from | Distributions | |||||||||||||||||||||||||||
investment operations | to shareholders | |||||||||||||||||||||||||||
Net asset | ||||||||||||||||||||||||||||
value, | Net | Net realized | Total from | From net | From net | |||||||||||||||||||||||
beginning | investment | and unrealized | investment | investment | realized | |||||||||||||||||||||||
Year - Share Class | of period | income (loss)(a) | gain (loss) | operations | income | gains | ||||||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||||||
2007 - A | $ | 9.03 | $ | (0.03 | ) | $ | 0.68 | $ | 0.65 | $ | — | $ | — | |||||||||||||||
2007 - B | 8.55 | (0.06 | ) | 0.65 | 0.59 | — | — | |||||||||||||||||||||
2007 - C | 8.57 | (0.06 | ) | 0.64 | 0.58 | — | — | |||||||||||||||||||||
2007 - Institutional | 9.25 | (0.01 | ) | 0.70 | 0.69 | — | — | |||||||||||||||||||||
2007 - Service | 9.06 | (0.03 | ) | 0.68 | 0.65 | — | — | |||||||||||||||||||||
FOR THE YEARS ENDED AUGUST 31, | ||||||||||||||||||||||||||||
2006 - A | 8.75 | (0.05 | ) | 0.33 | 0.28 | — | — | |||||||||||||||||||||
2006 - B | 8.35 | (0.11 | ) | 0.31 | 0.20 | — | — | |||||||||||||||||||||
2006 - C | 8.36 | (0.11 | ) | 0.32 | 0.21 | — | — | |||||||||||||||||||||
2006 - Institutional | 8.94 | (0.01 | ) | 0.33 | 0.32 | (0.01 | ) | — | ||||||||||||||||||||
2006 - Service | 8.77 | (0.05 | ) | 0.34 | 0.29 | — | — | |||||||||||||||||||||
2005 - A | 8.07 | 0.01 | (d) | 0.67 | 0.68 | — | (c) | — | ||||||||||||||||||||
2005 - B | 7.76 | (0.05 | )(d) | 0.64 | 0.59 | — | — | |||||||||||||||||||||
2005 - C | 7.78 | (0.05 | )(d) | 0.63 | 0.58 | — | — | |||||||||||||||||||||
2005 - Institutional | 8.25 | 0.05 | (d) | 0.68 | 0.73 | (0.04 | ) | — | ||||||||||||||||||||
2005 - Service | 8.10 | — | (c)(d) | 0.67 | 0.67 | — | (c) | — | ||||||||||||||||||||
2004 - A | 7.79 | (0.04 | ) | 0.32 | 0.28 | — | — | |||||||||||||||||||||
2004 - B | 7.55 | (0.10 | ) | 0.31 | 0.21 | — | — | |||||||||||||||||||||
2004 - C | 7.56 | (0.10 | ) | 0.32 | 0.22 | — | — | |||||||||||||||||||||
2004 - Institutional | 7.93 | (0.01 | ) | 0.33 | 0.32 | — | — | |||||||||||||||||||||
2004 - Service | 7.82 | (0.05 | ) | 0.33 | 0.28 | — | — | |||||||||||||||||||||
2003 - A | 6.95 | (0.03 | ) | 0.87 | 0.84 | — | — | |||||||||||||||||||||
2003 - B | 6.79 | (0.08 | ) | 0.84 | 0.76 | — | — | |||||||||||||||||||||
2003 - C | 6.80 | (0.09 | ) | 0.85 | 0.76 | — | — | |||||||||||||||||||||
2003 - Institutional | 7.05 | (0.01 | ) | 0.89 | 0.88 | — | — | |||||||||||||||||||||
2003 - Service | 6.97 | (0.03 | ) | 0.88 | 0.85 | — | — | |||||||||||||||||||||
2002 - A | 9.22 | (0.06 | ) | (2.21 | ) | (2.27 | ) | — | — | (c) | ||||||||||||||||||
2002 - B | 9.07 | (0.12 | ) | (2.16 | ) | (2.28 | ) | — | — | (c) | ||||||||||||||||||
2002 - C | 9.08 | (0.12 | ) | (2.16 | ) | (2.28 | ) | — | — | (c) | ||||||||||||||||||
2002 - Institutional | 9.30 | (0.02 | ) | (2.23 | ) | (2.25 | ) | — | — | (c) | ||||||||||||||||||
2002 - Service | 9.23 | (0.05 | ) | (2.21 | ) | (2.26 | ) | — | — | (c) | ||||||||||||||||||
(a) | Calculated based on the average shares outstanding methodology. |
(b) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
(c) | Amount is less than $0.005 per share. |
(d) | Reflects income recognized from special dividends which amounted to $0.05 per share and 0.57% of average net assets. |
(e) | Amount is less than 0.005% per share. |
(f) | Annualized. |
The accompanying notes are an integral part of these financial statements.
60
GOLDMAN SACHS STRATEGIC GROWTH FUND
Ratios assuming no | ||||||||||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||
Net assets, | Ratio of | net investment | Ratio of | net investment | ||||||||||||||||||||||||||||||
Net asset | end of | net expenses | income (loss) | total expenses | income (loss) | Portfolio | ||||||||||||||||||||||||||||
value, end | Total | period | to average | to average | to average | to average | turnover | |||||||||||||||||||||||||||
of period | return(b) | (in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||||||||
$ | 9.68 | 7.20 | % | $ | 132,469 | 1.44 | %(f) | (0.60 | )%(f) | 1.50 | %(f) | (0.66 | )%(f) | 20 | % | |||||||||||||||||||
9.14 | 6.90 | 6,840 | 2.19 | (f) | (1.36 | )(f) | 2.25 | (f) | (1.42 | )(f) | 20 | |||||||||||||||||||||||
9.15 | 6.77 | 10,123 | 2.19 | (f) | (1.36 | )(f) | 2.25 | (f) | (1.42 | )(f) | 20 | |||||||||||||||||||||||
9.94 | 7.46 | 155,240 | 1.04 | (f) | (0.20 | )(f) | 1.10 | (f) | (0.26 | )(f) | 20 | |||||||||||||||||||||||
9.71 | 7.17 | 3 | 1.54 | (f) | (0.69 | )(f) | 1.60 | (f) | (0.75 | )(f) | 20 | |||||||||||||||||||||||
9.03 | 3.20 | 127,318 | 1.44 | (0.52 | ) | 1.56 | (0.64 | ) | 53 | |||||||||||||||||||||||||
8.55 | 2.40 | 7,619 | 2.19 | (1.27 | ) | 2.30 | (1.38 | ) | 53 | |||||||||||||||||||||||||
8.57 | 2.51 | 10,344 | 2.19 | (1.27 | ) | 2.31 | (1.39 | ) | 53 | |||||||||||||||||||||||||
9.25 | 3.56 | 183,697 | 1.04 | (0.12 | ) | 1.16 | (0.24 | ) | 53 | |||||||||||||||||||||||||
9.06 | 3.31 | 12 | 1.54 | (0.45 | ) | 1.65 | (0.55 | ) | 53 | |||||||||||||||||||||||||
8.75 | 8.44 | 164,330 | 1.44 | 0.12 | (d) | 1.57 | (0.01 | )(d) | 46 | |||||||||||||||||||||||||
8.35 | 7.60 | 10,195 | 2.19 | (0.62 | )(d) | 2.32 | (0.75 | )(d) | 46 | |||||||||||||||||||||||||
8.36 | 7.46 | 11,392 | 2.19 | (0.64 | )(d) | 2.32 | (0.77 | )(d) | 46 | |||||||||||||||||||||||||
8.94 | 8.82 | 155,546 | 1.04 | 0.54 | (d) | 1.17 | 0.41 | (d) | 46 | |||||||||||||||||||||||||
8.77 | 8.27 | 261 | 1.54 | 0.00 | (d)(e) | 1.67 | (0.13 | )(d) | 46 | |||||||||||||||||||||||||
8.07 | 3.59 | 173,243 | 1.44 | (0.47 | ) | 1.55 | (0.58 | ) | 19 | |||||||||||||||||||||||||
7.76 | 2.78 | 11,537 | 2.19 | (1.22 | ) | 2.30 | (1.33 | ) | 19 | |||||||||||||||||||||||||
7.78 | 2.91 | 11,491 | 2.19 | (1.22 | ) | 2.30 | (1.33 | ) | 19 | |||||||||||||||||||||||||
8.25 | 4.04 | 129,083 | 1.04 | (0.07 | ) | 1.15 | (0.18 | ) | 19 | |||||||||||||||||||||||||
8.10 | 3.58 | 297 | 1.54 | (0.58 | ) | 1.65 | (0.69 | ) | 19 | |||||||||||||||||||||||||
7.79 | 12.09 | 146,867 | 1.45 | (0.49 | ) | 1.62 | (0.66 | ) | 14 | |||||||||||||||||||||||||
7.55 | 11.19 | 11,452 | 2.20 | (1.24 | ) | 2.37 | (1.41 | ) | 14 | |||||||||||||||||||||||||
7.56 | 11.18 | 8,979 | 2.20 | (1.24 | ) | 2.37 | (1.41 | ) | 14 | |||||||||||||||||||||||||
7.93 | 12.48 | 93,806 | 1.05 | (0.09 | ) | 1.22 | (0.26 | ) | 14 | |||||||||||||||||||||||||
7.82 | 12.20 | 1 | 1.55 | (0.44 | ) | 1.72 | (0.61 | ) | 14 | |||||||||||||||||||||||||
6.95 | (24.59 | ) | 113,813 | 1.45 | (0.66 | ) | 1.63 | (0.84 | ) | 40 | ||||||||||||||||||||||||
6.79 | (25.11 | ) | 9,781 | 2.20 | (1.41 | ) | 2.38 | (1.59 | ) | 40 | ||||||||||||||||||||||||
6.80 | (25.08 | ) | 5,109 | 2.20 | (1.41 | ) | 2.38 | (1.59 | ) | 40 | ||||||||||||||||||||||||
7.05 | (24.17 | ) | 59,130 | 1.05 | (0.27 | ) | 1.23 | (0.45 | ) | 40 | ||||||||||||||||||||||||
6.97 | (24.46 | ) | 1 | 1.55 | (0.58 | ) | 1.73 | (0.76 | ) | 40 | ||||||||||||||||||||||||
61
GOLDMAN SACHS CONCENTRATED GROWTH FUND
Financial Highlights
Selected Data for a Share Outstanding Throughout each Period
Income (loss) from | Distributions | |||||||||||||||||||||||||||||||
investment operations | to shareholders | |||||||||||||||||||||||||||||||
Net asset | ||||||||||||||||||||||||||||||||
value, | Net | Net realized | Total from | From net | From net | |||||||||||||||||||||||||||
beginning | investment | and unrealized | investment | investment | realized | Total | ||||||||||||||||||||||||||
Year - Share Class | of period | income (loss)(a) | gain | operations | income | gains | distributions | |||||||||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||||||||||
2007 - A | $ | 12.98 | $ | (0.04 | ) | $ | 1.14 | $ | 1.10 | $ | — | $ | (0.48 | ) | $ | (0.48 | ) | |||||||||||||||
2007 - B | 12.59 | (0.09 | ) | 1.11 | 1.02 | — | (0.48 | ) | (0.48 | ) | ||||||||||||||||||||||
2007 - C | 12.57 | (0.09 | ) | 1.10 | 1.01 | — | (0.48 | ) | (0.48 | ) | ||||||||||||||||||||||
2007 - Institutional | 13.15 | (0.01 | ) | 1.15 | 1.14 | — | (0.48 | ) | (0.48 | ) | ||||||||||||||||||||||
2007 - Service | 12.97 | (0.04 | ) | 1.13 | 1.09 | — | (0.48 | ) | (0.48 | ) | ||||||||||||||||||||||
FOR THE YEARS ENDED AUGUST 31, | ||||||||||||||||||||||||||||||||
2006 - A | 12.74 | (0.06 | ) | 0.61 | 0.55 | — | (0.31 | ) | (0.31 | ) | ||||||||||||||||||||||
2006 - B | 12.46 | (0.15 | ) | 0.59 | 0.44 | — | (0.31 | ) | (0.31 | ) | ||||||||||||||||||||||
2006 - C | 12.43 | (0.16 | ) | 0.61 | 0.45 | — | (0.31 | ) | (0.31 | ) | ||||||||||||||||||||||
2006 - Institutional | 12.89 | (0.01 | ) | 0.62 | 0.61 | (0.04 | ) | (0.31 | ) | (0.35 | ) | |||||||||||||||||||||
2006 - Service | 12.73 | (0.07 | ) | 0.62 | 0.55 | — | (0.31 | ) | (0.31 | ) | ||||||||||||||||||||||
2005 - A | 11.70 | 0.01 | (d) | 1.22 | 1.23 | — | (0.19 | ) | (0.19 | ) | ||||||||||||||||||||||
2005 - B | 11.53 | (0.09 | )(d) | 1.21 | 1.12 | — | (0.19 | ) | (0.19 | ) | ||||||||||||||||||||||
2005 - C | 11.51 | (0.09 | )(d) | 1.20 | 1.11 | — | (0.19 | ) | (0.19 | ) | ||||||||||||||||||||||
2005 - Institutional | 11.79 | 0.05 | (d) | 1.24 | 1.29 | — | (0.19 | ) | (0.19 | ) | ||||||||||||||||||||||
2005 - Service | 11.70 | — | (d) | 1.22 | 1.22 | — | (0.19 | ) | (0.19 | ) | ||||||||||||||||||||||
2004 - A | 11.64 | (0.07 | ) | 0.17 | 0.10 | — | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||
2004 - B | 11.56 | (0.16 | ) | 0.17 | 0.01 | — | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||
2004 - C | 11.55 | (0.16 | ) | 0.16 | — | — | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||
2004 - Institutional | 11.68 | (0.02 | ) | 0.17 | 0.15 | — | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||
2004 - Service | 11.64 | (0.07 | ) | 0.17 | 0.10 | — | (0.04 | ) | (0.04 | ) | ||||||||||||||||||||||
FOR THE PERIOD ENDED AUGUST 31, | ||||||||||||||||||||||||||||||||
2003 - A (commenced September 3, 2002) | 10.00 | (0.08 | ) | 1.72 | 1.64 | — | — | — | ||||||||||||||||||||||||
2003 - B (commenced September 3, 2002) | 10.00 | (0.16 | ) | 1.72 | 1.56 | — | — | — | ||||||||||||||||||||||||
2003 - C (commenced September 3, 2002) | 10.00 | (0.16 | ) | 1.71 | 1.55 | — | — | — | ||||||||||||||||||||||||
2003 - Institutional (commenced September 3, 2002) | 10.00 | (0.03 | ) | 1.71 | 1.68 | — | — | — | ||||||||||||||||||||||||
2003 - Service (commenced September 3, 2002) | 10.00 | (0.07 | ) | 1.71 | 1.64 | — | — | — | ||||||||||||||||||||||||
(a) | Calculated based on the average shares outstanding methodology. |
(b) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
(c) | Annualized. |
(d) | Reflects income recognized from special dividends which amounted to $0.06 per share and 0.51% of average net assets. |
The accompanying notes are an integral part of these financial statements.
62
GOLDMAN SACHS CONCENTRATED GROWTH FUND
Ratios assuming no | ||||||||||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||
Net assets, | Ratio of | net investment | Ratio of | net investment | ||||||||||||||||||||||||||||||
Net asset | end of | net expenses | income (loss) | total expenses | income (loss) | Portfolio | ||||||||||||||||||||||||||||
value, end | Total | period | to average | to average | to average | to average | turnover | |||||||||||||||||||||||||||
of period | return(b) | (in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||||||||
$ | 13.60 | 8.42 | % | $ | 76,891 | 1.48 | %(c) | (0.60 | )%(c) | 1.56 | %(c) | (0.68 | )%(c) | 24 | % | |||||||||||||||||||
13.13 | 8.04 | 572 | 2.23 | (c) | (1.35 | )(c) | 2.31 | (c) | (1.43 | )(c) | 24 | |||||||||||||||||||||||
13.10 | 7.97 | 724 | 2.23 | (c) | (1.36 | )(c) | 2.31 | (c) | (1.44 | )(c) | 24 | |||||||||||||||||||||||
13.81 | 8.62 | 140,304 | 1.08 | (c) | (0.20 | )(c) | 1.16 | (c) | (0.28 | )(c) | 24 | |||||||||||||||||||||||
13.58 | 8.35 | 2 | 1.58 | (c) | (0.65 | )(c) | 1.66 | (c) | (0.73 | )(c) | 24 | |||||||||||||||||||||||
12.98 | 4.32 | 70,352 | 1.48 | (0.49 | ) | 1.64 | (0.69 | ) | 48 | |||||||||||||||||||||||||
12.59 | 3.52 | 380 | 2.23 | (1.22 | ) | 2.39 | (1.43 | ) | 48 | |||||||||||||||||||||||||
12.57 | 3.62 | 507 | 2.23 | (1.24 | ) | 2.39 | (1.44 | ) | 48 | |||||||||||||||||||||||||
13.15 | 4.75 | 117,767 | 1.08 | (0.09 | ) | 1.24 | (0.30 | ) | 48 | |||||||||||||||||||||||||
12.97 | 4.33 | 2 | 1.51 | (0.54 | ) | 1.68 | (0.74 | ) | 48 | |||||||||||||||||||||||||
12.74 | 10.52 | 62,366 | 1.48 | 0.06 | (d) | 1.71 | (0.17 | )(d) | 46 | |||||||||||||||||||||||||
12.46 | 9.71 | 115 | 2.23 | (0.72 | )(d) | 2.46 | (0.95 | )(d) | 46 | |||||||||||||||||||||||||
12.43 | 9.64 | 401 | 2.23 | (0.76 | )(d) | 2.46 | (0.99 | )(d) | 46 | |||||||||||||||||||||||||
12.89 | 10.95 | 85,571 | 1.08 | 0.40 | (d) | 1.31 | 0.17 | (d) | 46 | |||||||||||||||||||||||||
12.73 | 10.43 | 2 | 1.58 | (0.05 | )(d) | 1.81 | (0.28 | )(d) | 46 | |||||||||||||||||||||||||
11.70 | 0.84 | 61,216 | 1.48 | (0.61 | ) | 1.79 | (0.92 | ) | 28 | |||||||||||||||||||||||||
11.53 | 0.06 | 96 | 2.23 | (1.38 | ) | 2.54 | (1.69 | ) | 28 | |||||||||||||||||||||||||
11.51 | (0.02 | ) | 247 | 2.23 | (1.34 | ) | 2.54 | (1.65 | ) | 28 | ||||||||||||||||||||||||
11.79 | 1.26 | 45,464 | 1.08 | (0.20 | ) | 1.39 | (0.51 | ) | 28 | |||||||||||||||||||||||||
11.70 | 0.84 | 2 | 1.58 | (0.61 | ) | 1.89 | (0.92 | ) | 28 | |||||||||||||||||||||||||
11.64 | 16.40 | 49,494 | 1.48 | (c) | (0.76 | )(c) | 2.65 | (c) | (1.93 | )(c) | 19 | |||||||||||||||||||||||
11.56 | 15.60 | 92 | 2.23 | (c) | (1.50 | )(c) | 3.40 | (c) | (2.67 | )(c) | 19 | |||||||||||||||||||||||
11.55 | 15.50 | 20 | 2.23 | (c) | (1.53 | )(c) | 3.40 | (c) | (2.70 | )(c) | 19 | |||||||||||||||||||||||
11.68 | 16.80 | 27,810 | 1.08 | (c) | (0.32 | )(c) | 2.25 | (c) | (1.49 | )(c) | 19 | |||||||||||||||||||||||
11.64 | 16.40 | 2 | 1.58 | (c) | (0.72 | )(c) | 2.75 | (c) | (1.89 | )(c) | 19 | |||||||||||||||||||||||
63
GOLDMAN SACHS GROWTH OPPORTUNITIES FUND
Financial Highlights
Selected Data for a Share Outstanding Throughout Each Period
Income (loss) from | ||||||||||||||||||||||||
investment operations | ||||||||||||||||||||||||
Distributions | ||||||||||||||||||||||||
Net asset | to shareholders | |||||||||||||||||||||||
value, | Net | Net realized | Total from | From net | ||||||||||||||||||||
beginning | investment | and unrealized | investment | realized | ||||||||||||||||||||
Year - Share Class | of period | loss(a) | gain (loss) | operations | gains | |||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||
2007 - A | $ | 20.81 | $ | (0.11 | ) | $ | 3.11 | $ | 3.00 | $ | (1.17 | ) | ||||||||||||
2007 - B | 19.80 | (0.18 | ) | 2.94 | 2.76 | (1.17 | ) | |||||||||||||||||
2007 - C | 19.66 | (0.18 | ) | 2.93 | 2.75 | (1.17 | ) | |||||||||||||||||
2007 - Institutional | 21.45 | (0.06 | ) | 3.19 | 3.13 | (1.17 | ) | |||||||||||||||||
2007 - Service | 20.63 | (0.11 | ) | 3.07 | 2.96 | (1.17 | ) | |||||||||||||||||
FOR THE YEARS ENDED AUGUST 31, | ||||||||||||||||||||||||
2006 - A | 22.21 | (0.19 | ) | (0.09 | ) | (0.28 | ) | (1.12 | ) | |||||||||||||||
2006 - B | 21.33 | (0.34 | ) | (0.07 | ) | (0.41 | ) | (1.12 | ) | |||||||||||||||
2006 - C | 21.19 | (0.34 | ) | (0.07 | ) | (0.41 | ) | (1.12 | ) | |||||||||||||||
2006 - Institutional | 22.77 | (0.11 | ) | (0.09 | ) | (0.20 | ) | (1.12 | ) | |||||||||||||||
2006 - Service | 22.05 | (0.21 | ) | (0.09 | ) | (0.30 | ) | (1.12 | ) | |||||||||||||||
2005 - A | 18.58 | (0.20 | ) (c) | 3.83 | 3.63 | — | ||||||||||||||||||
2005 - B | 17.98 | (0.34 | ) (c) | 3.69 | 3.35 | — | ||||||||||||||||||
2005 - C | 17.86 | (0.34 | ) (c) | 3.67 | 3.33 | — | ||||||||||||||||||
2005 - Institutional | 18.97 | (0.12 | ) (c) | 3.92 | 3.80 | — | ||||||||||||||||||
2005 - Service | 18.46 | (0.23 | ) (c) | 3.82 | 3.59 | — | ||||||||||||||||||
2004 - A | 17.38 | (0.15 | ) | 1.35 | 1.20 | — | ||||||||||||||||||
2004 - B | 16.94 | (0.28 | ) | 1.32 | 1.04 | — | ||||||||||||||||||
2004 - C | 16.83 | (0.28 | ) | 1.31 | 1.03 | — | ||||||||||||||||||
2004 - Institutional | 17.67 | (0.08 | ) | 1.38 | 1.30 | — | ||||||||||||||||||
2004 - Service | 17.29 | (0.17 | ) | 1.34 | 1.17 | — | ||||||||||||||||||
2003 - A | 14.09 | (0.12 | ) | 3.41 | 3.29 | — | ||||||||||||||||||
2003 - B | 13.84 | (0.22 | ) | 3.32 | 3.10 | — | ||||||||||||||||||
2003 - C | 13.74 | (0.22 | ) | 3.31 | 3.09 | — | ||||||||||||||||||
2003 - Institutional | 14.27 | (0.06 | ) | 3.46 | 3.40 | — | ||||||||||||||||||
2003 - Service | 14.03 | (0.13 | ) | 3.39 | 3.26 | — | ||||||||||||||||||
2002 - A | 18.11 | (0.15 | ) | (3.87 | ) | (4.02 | ) | — | �� | |||||||||||||||
2002 - B | 17.92 | (0.27 | ) | (3.81 | ) | (4.08 | ) | — | ||||||||||||||||
2002 - C | 17.80 | (0.27 | ) | (3.79 | ) | (4.06 | ) | — | ||||||||||||||||
2002 - Institutional | 18.26 | (0.08 | ) | (3.91 | ) | (3.99 | ) | — | ||||||||||||||||
2002 - Service | 18.05 | (0.16 | ) | (3.86 | ) | (4.02 | ) | — | ||||||||||||||||
(a) | Calculated based on the average shares outstanding methodology. |
(b) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
(c) | Reflects income recognized from special dividends which amounted to $0.01 per share and 0.03% of average net assets. |
(d) | Annualized. |
The accompanying notes are an integral part of these financial statements.
64
GOLDMAN SACHS GROWTH OPPORTUNITIES FUND
Ratios assuming no | ||||||||||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||
Net assets, | Ratio of | net investment | Ratio of | net investment | ||||||||||||||||||||||||||||||
Net asset | end of | net expenses | loss | total expenses | loss | Portfolio | ||||||||||||||||||||||||||||
value, end | Total | period | to average | to average | to average | to average | turnover | |||||||||||||||||||||||||||
of period | return(b) | (in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||||||||
$ | 22.64 | 14.51 | % | $ | 908,299 | 1.47 | %(d) | (0.95 | )%(d) | 1.47 | %(d) | (0.95 | )%(d) | 26 | % | |||||||||||||||||||
21.39 | 14.09 | 64,635 | 2.22 | (d) | (1.70 | )(d) | 2.22 | (d) | (1.70 | )(d) | 26 | |||||||||||||||||||||||
21.24 | 14.08 | 113,918 | 2.22 | (d) | (1.70 | )(d) | 2.22 | (d) | (1.70 | )(d) | 26 | |||||||||||||||||||||||
23.41 | 14.74 | 792,383 | 1.07 | (d) | (0.55 | )(d) | 1.07 | (d) | (0.55 | )(d) | 26 | |||||||||||||||||||||||
22.42 | 14.45 | 10,999 | 1.57 | (d) | (1.05 | )(d) | 1.57 | (d) | (1.05 | )(d) | 26 | |||||||||||||||||||||||
20.81 | (1.46 | ) | 908,135 | 1.47 | (0.89 | ) | 1.47 | (0.89 | ) | 82 | ||||||||||||||||||||||||
19.80 | (2.16 | ) | 69,240 | 2.22 | (1.64 | ) | 2.22 | (1.64 | ) | 82 | ||||||||||||||||||||||||
19.66 | (2.17 | ) | 113,383 | 2.22 | (1.64 | ) | 2.22 | (1.64 | ) | 82 | ||||||||||||||||||||||||
21.45 | (1.06 | ) | 771,166 | 1.07 | (0.49 | ) | 1.07 | (0.49 | ) | 82 | ||||||||||||||||||||||||
20.63 | (1.56 | ) | 10,961 | 1.57 | (0.99 | ) | 1.57 | (0.99 | ) | 82 | ||||||||||||||||||||||||
22.21 | 19.54 | 936,312 | 1.49 | (0.94 | )(c) | 1.49 | (0.94 | )(c) | 62 | |||||||||||||||||||||||||
21.33 | 18.63 | 91,286 | 2.24 | (1.69 | )(c) | 2.24 | (1.69 | )(c) | 62 | |||||||||||||||||||||||||
21.19 | 18.65 | 112,420 | 2.24 | (1.69 | )(c) | 2.24 | (1.69 | )(c) | 62 | |||||||||||||||||||||||||
22.77 | 20.03 | 739,739 | 1.09 | (0.54 | )(c) | 1.09 | (0.54 | )(c) | 62 | |||||||||||||||||||||||||
22.05 | 19.45 | 8,242 | 1.59 | (1.04 | )(c) | 1.59 | (1.04 | )(c) | 62 | |||||||||||||||||||||||||
18.58 | 6.90 | 615,510 | 1.49 | (0.80 | ) | 1.49 | (0.80 | ) | 51 | |||||||||||||||||||||||||
17.98 | 6.14 | 85,969 | 2.24 | (1.55 | ) | 2.24 | (1.55 | ) | 51 | |||||||||||||||||||||||||
17.86 | 6.12 | 69,067 | 2.24 | (1.55 | ) | 2.24 | (1.55 | ) | 51 | |||||||||||||||||||||||||
18.97 | 7.36 | 290,601 | 1.09 | (0.40 | ) | 1.09 | (0.40 | ) | 51 | |||||||||||||||||||||||||
18.46 | 6.77 | 1,464 | 1.59 | (0.87 | ) | 1.59 | (0.87 | ) | 51 | |||||||||||||||||||||||||
17.38 | 23.35 | 441,187 | 1.53 | (0.80 | ) | 1.53 | (0.80 | ) | 66 | |||||||||||||||||||||||||
16.94 | 22.40 | 85,601 | 2.28 | (1.56 | ) | 2.28 | (1.56 | ) | 66 | |||||||||||||||||||||||||
16.83 | 22.49 | 63,358 | 2.28 | (1.56 | ) | 2.28 | (1.56 | ) | 66 | |||||||||||||||||||||||||
17.67 | 23.83 | 189,498 | 1.13 | (0.41 | ) | 1.13 | (0.41 | ) | 66 | |||||||||||||||||||||||||
17.29 | 23.24 | 539 | 1.63 | (0.90 | ) | 1.63 | (0.90 | ) | 66 | |||||||||||||||||||||||||
14.09 | (22.20 | ) | 368,361 | 1.51 | (0.87 | ) | 1.51 | (0.87 | ) | 69 | ||||||||||||||||||||||||
13.84 | (22.77 | ) | 68,639 | 2.26 | (1.62 | ) | 2.26 | (1.62 | ) | 69 | ||||||||||||||||||||||||
13.74 | (22.81 | ) | 47,581 | 2.26 | (1.62 | ) | 2.26 | (1.62 | ) | 69 | ||||||||||||||||||||||||
14.27 | (21.89 | ) | 134,954 | 1.11 | (0.47 | ) | 1.11 | (0.47 | ) | 69 | ||||||||||||||||||||||||
14.03 | (22.27 | ) | 471 | 1.61 | (0.99 | ) | 1.61 | (0.99 | ) | 69 | ||||||||||||||||||||||||
65
GOLDMAN SACHS SMALL/MID CAP GROWTH FUND
Financial Highlights
Selected Data for a Share Outstanding Throughout Each Period
Income (loss) from | Distributions | |||||||||||||||||||||||||||||||
investment operations | to shareholders | |||||||||||||||||||||||||||||||
Net asset | ||||||||||||||||||||||||||||||||
value, | Net | Net realized | Total from | From net | From net | |||||||||||||||||||||||||||
beginning | investment | and unrealized | investment | investment | realized | Total | ||||||||||||||||||||||||||
Year - Share Class | of period | loss(a) | gain | operations | income | gains | distributions | |||||||||||||||||||||||||
FOR THE SIX MONTHS ENDED FEBRUARY 28, (Unaudited) | ||||||||||||||||||||||||||||||||
2007 - A | $ | 10.42 | $ | (0.05 | ) | $ | 1.75 | $ | 1.70 | $ | — | $ | — | $ | — | |||||||||||||||||
2007 - B | 10.30 | (0.09 | ) | 1.73 | 1.64 | — | — | — | ||||||||||||||||||||||||
2007 - C | 10.30 | (0.09 | ) | 1.73 | 1.64 | — | — | — | ||||||||||||||||||||||||
2007 - Institutional | 10.44 | (0.03 | ) | 1.76 | 1.73 | — | — | — | ||||||||||||||||||||||||
2007 - Service | 10.37 | (0.06 | ) | 1.76 | 1.70 | — | — | — | ||||||||||||||||||||||||
FOR THE YEAR ENDED AUGUST 31, | ||||||||||||||||||||||||||||||||
2006 - A | 10.40 | (0.09 | ) | 0.22 | 0.13 | — | (d) | (0.11 | ) | (0.11 | ) | |||||||||||||||||||||
2006 - B | 10.36 | (0.16 | ) | 0.21 | 0.05 | — | (0.11 | ) | (0.11 | ) | ||||||||||||||||||||||
2006 - C | 10.36 | (0.16 | ) | 0.21 | 0.05 | — | (0.11 | ) | (0.11 | ) | ||||||||||||||||||||||
2006 - Institutional | 10.38 | (0.04 | ) | 0.21 | 0.17 | — | (d) | (0.11 | ) | (0.11 | ) | |||||||||||||||||||||
2006 - Service | 10.37 | (0.10 | ) | 0.21 | 0.11 | — | (0.11 | ) | (0.11 | ) | ||||||||||||||||||||||
FOR THE PERIOD ENDED AUGUST 31, | ||||||||||||||||||||||||||||||||
2005 - A (commenced June 30, 2005) | 10.00 | (0.01 | ) | 0.41 | 0.40 | — | — | — | ||||||||||||||||||||||||
2005 - B (commenced June 30, 2005) | 10.00 | (0.02 | ) | 0.38 | 0.36 | — | — | — | ||||||||||||||||||||||||
2005 - C (commenced June 30, 2005) | 10.00 | (0.02 | ) | 0.38 | 0.36 | — | — | — | ||||||||||||||||||||||||
2005 - Institutional (commenced June 30, 2005) | 10.00 | — | (d) | 0.38 | 0.38 | — | — | — | ||||||||||||||||||||||||
2005 - Service (commenced June 30, 2005) | 10.00 | (0.01 | ) | 0.38 | 0.37 | — | — | — | ||||||||||||||||||||||||
(a) | Calculated based on the average shares outstanding methodology. |
(b) | Assumes investment at the net asset value at the beginning of the period, reinvestment of all dividends and distributions, a complete redemption of the investment at the net asset value at the end of the period and no sales or redemption charges. Total return would be reduced if a sales or redemption charge were taken into account. Total returns for periods less than one full year are not annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. |
(c) | Annualized. |
(d) | Amount is less than $0.005 per share. |
The accompanying notes are an integral part of these financial statements.
66
GOLDMAN SACHS SMALL/MID CAP GROWTH FUND
Ratios assuming no | ||||||||||||||||||||||||||||||||||
expense reductions | ||||||||||||||||||||||||||||||||||
Ratio of | Ratio of | |||||||||||||||||||||||||||||||||
Net assets, | Ratio of | net investment | Ratio of | net investment | ||||||||||||||||||||||||||||||
Net asset | end of | net expenses | loss | total expenses | loss | Portfolio | ||||||||||||||||||||||||||||
value, end | Total | period | to average | to average | to average | to average | turnover | |||||||||||||||||||||||||||
of period | return(b) | (in 000s) | net assets | net assets | net assets | net assets | rate | |||||||||||||||||||||||||||
$ | 12.12 | 16.31 | % | $ | 79,999 | 1.49 | %(c) | (0.92 | )%(c) | 1.56 | %(c) | (0.99 | )%(c) | 30 | % | |||||||||||||||||||
11.94 | 15.92 | 1,918 | 2.24 | (c) | (1.67 | )(c) | 2.31 | (c) | (1.74 | )(c) | 30 | |||||||||||||||||||||||
11.94 | 15.92 | 5,184 | 2.24 | (c) | (1.69 | )(c) | 2.31 | (c) | (1.76 | )(c) | 30 | |||||||||||||||||||||||
12.17 | 16.57 | 1,645 | 1.09 | (c) | (0.52 | )(c) | 1.16 | (c) | (0.59 | )(c) | 30 | |||||||||||||||||||||||
12.07 | 16.39 | 197 | 1.59 | (c) | (1.02 | )(c) | 1.66 | (c) | (1.09 | )(c) | 30 | |||||||||||||||||||||||
10.42 | 1.24 | 72,124 | 1.49 | (0.79 | ) | 2.05 | (1.35 | ) | 64 | |||||||||||||||||||||||||
10.30 | 0.45 | 1,563 | 2.25 | (1.56 | ) | 3.15 | (2.47 | ) | 64 | |||||||||||||||||||||||||
10.30 | 0.45 | 5,937 | 2.25 | (1.54 | ) | 2.82 | (2.12 | ) | 64 | |||||||||||||||||||||||||
10.44 | 1.63 | 1,360 | 1.07 | (0.38 | ) | 6.98 | (6.29 | ) | 64 | |||||||||||||||||||||||||
10.37 | 1.04 | 153 | 1.61 | (0.95 | ) | 2.46 | (1.81 | ) | 64 | |||||||||||||||||||||||||
10.40 | 4.00 | 569 | 1.50 | (c) | (0.69 | )(c) | 16.73 | (c) | (15.92 | )(c) | 3 | |||||||||||||||||||||||
10.36 | 3.60 | 69 | 2.25 | (c) | (1.42 | )(c) | 17.48 | (c) | (16.65 | )(c) | 3 | |||||||||||||||||||||||
10.36 | 3.60 | 19 | 2.25 | (c) | (1.35 | )(c) | 17.48 | (c) | (16.58 | )(c) | 3 | |||||||||||||||||||||||
10.38 | 3.80 | 5,415 | 1.10 | (c) | (0.13 | )(c) | 16.33 | (c) | (15.36 | )(c) | 3 | |||||||||||||||||||||||
10.37 | 3.70 | 10 | 1.60 | (c) | (0.62 | )(c) | 16.83 | (c) | (15.85 | )(c) | 3 | |||||||||||||||||||||||
67
GOLDMAN SACHS GROWTH EQUITY FUNDS
Fund Expenses (Unaudited) — Six Month Period Ended February 28, 2007
As a shareholder of Class A, Class B, Class C, Institutional or Service Shares of the Funds you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (with respect to Class A Shares), contingent deferred sales charges (loads) on redemptions (with respect to Class B and Class C Shares), and redemption fees (with respect to Class A, Class B, Class C, Institutional and Service Shares, if any); and (2) ongoing costs, including management fees; distribution and service (12b-1) fees (with respect to Class A, Class B and Class C Shares); and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in Class A, Class B, Class C, Institutional and Service Shares of the Funds and to 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 period from September 1, 2006 through February 28, 2007.
Actual Expenses — The first line under each share class in the table below 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” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes — The second line under each share class in the table below provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. 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 Funds and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please 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), redemption fees, or exchange fees. Therefore, the second line of 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.
Capital Growth Fund | Strategic Growth Fund | Concentrated Growth Fund | Growth Opportunities Fund | Small/Mid Cap Growth Fund | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Expenses | Expenses | Expenses | Expenses | Expenses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning | Ending | Paid for the | Beginning | Ending | Paid for the | Beginning | Ending | Paid for the | Beginning | Ending | Paid for the | Beginning | Ending | Paid for the | ||||||||||||||||||||||||||||||||||||||||||||||
Account Value | Account Value | 6 months ended | Account Value | Account Value | 6 months ended | Account Value | Account Value | 6 months ended | Account Value | Account Value | 6 months ended | Account Value | Account Value | 6 months ended | ||||||||||||||||||||||||||||||||||||||||||||||
Share Class | 9/1/06 | 2/28/07 | 2/28/07* | 9/1/06 | 2/28/07 | 2/28/07* | 9/1/06 | 2/28/07 | 2/28/07* | 9/1/06 | 2/28/07 | 2/28/07* | 9/1/06 | 2/28/07 | 2/28/07* | |||||||||||||||||||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | $ | 1,000 | $ | 1,078.60 | $ | 7.19 | $ | 1,000 | $ | 1,072.00 | $ | 7.41 | $ | 1,000 | $ | 1,084.20 | $ | 7.64 | $ | 1,000 | $ | 1,145.10 | $ | 7.80 | $ | 1,000 | $ | 1,163.10 | $ | 8.01 | ||||||||||||||||||||||||||||||
Hypothetical (5% return before expenses) | 1,000 | 1,017.88 | + | 6.98 | 1,000 | 1,017.64 | + | 7.22 | 1,000 | 1,017.46 | + | 7.40 | 1,000 | 1,017.53 | + | 7.33 | 1,000 | 1,017.39 | + | 7.47 | ||||||||||||||||||||||||||||||||||||||||
Class B | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | 1,000 | 1,073.60 | 11.02 | 1,000 | 1,069.00 | 11.24 | 1,000 | 1,080.40 | 11.53 | 1,000 | 1,140.90 | 11.76 | 1,000 | 1,159.20 | 12.02 | |||||||||||||||||||||||||||||||||||||||||||||
Hypothetical (5% return before expenses) | 1,000 | 1,014.17 | + | 10.70 | 1,000 | 1,013.93 | + | 10.94 | 1,000 | 1,013.71 | + | 11.16 | 1,000 | 1,013.81 | + | 11.06 | 1,000 | 1,013.66 | + | 11.21 | ||||||||||||||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | 1,000 | 1,074.20 | 11.03 | 1,000 | 1,067.70 | 11.24 | 1,000 | 1,079.70 | 11.51 | 1,000 | 1,140.80 | 11.76 | 1,000 | 1,159.20 | 12.01 | |||||||||||||||||||||||||||||||||||||||||||||
Hypothetical (5% return before expenses) | 1,000 | 1,014.17 | + | 10.70 | 1,000 | 1,013.93 | + | 10.94 | 1,000 | 1,013.71 | + | 11.16 | 1,000 | 1,013.81 | + | 11.06 | 1,000 | 1,013.66 | + | 11.21 | ||||||||||||||||||||||||||||||||||||||||
Institutional | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | 1,000 | 1,080.50 | 5.13 | 1,000 | 1,074.60 | 5.35 | 1,000 | 1,086.20 | 5.59 | 1,000 | 1,147.40 | 5.68 | 1,000 | 1,165.70 | 5.87 | |||||||||||||||||||||||||||||||||||||||||||||
Hypothetical (5% return before expenses) | 1,000 | 1,019.86 | + | 4.98 | 1,000 | 1,019.64 | + | 5.21 | 1,000 | 1,019.43 | + | 5.41 | 1,000 | 1,019.51 | + | 5.34 | 1,000 | 1,019.37 | + | 5.48 | ||||||||||||||||||||||||||||||||||||||||
Service | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | 1,000 | 1,077.50 | 7.70 | 1,000 | 1,071.70 | 7.91 | 1,000 | 1,083.50 | 8.16 | 1,000 | 1,144.50 | 8.32 | 1,000 | 1,163.90 | 8.53 | |||||||||||||||||||||||||||||||||||||||||||||
Hypothetical (5% return before expenses) | 1,000 | 1,017.38 | + | 7.48 | 1,000 | 1,017.22 | + | 7.70 | 1,000 | 1,016.96 | + | 7.90 | 1,000 | 1,017.04 | + | 7.85 | 1,000 | 1,016.87 | + | 7.95 | ||||||||||||||||||||||||||||||||||||||||
* | Expenses for each share class are calculated using each Fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of net assets for the six months ended February 28, 2007. Expenses are calculated by multiplying the annualized expense ratio by the average account value for the period; then multiplying the result by the number of days in the most recent fiscal half year; and then dividing that result by the number of days in the calendar year. Expense ratios for the most recent fiscal half year may differ from expense ratios based on one-year data in the financial highlights. The expense ratios for the period were as follows: |
Fund | Class A | Class B | Class C | Institutional | Service | |||||||||||||||
Capital Growth | 1.39 | % | 2.14 | % | 2.14 | % | 0.99 | % | 1.49 | % | ||||||||||
Strategic Growth | 1.44 | 2.19 | 2.19 | 1.04 | 1.54 | |||||||||||||||
Concentrated Growth | 1.48 | 2.23 | 2.23 | 1.08 | 1.58 | |||||||||||||||
Growth Opportunities | 1.47 | 2.22 | 2.22 | 1.07 | 1.57 | |||||||||||||||
Small/Mid Cap Growth | 1.49 | 2.24 | 2.24 | 1.09 | 1.59 | |||||||||||||||
+ | Hypothetical expenses are based on each Fund’s actual annualized expense ratios and an assumed rate of return of 5% per year before expenses. |
68
FUNDS PROFILE
Goldman Sachs Funds
Goldman Sachs is a premier financial services firm, known since 1869 for creating thoughtful and customized investment solutions in complex global markets.
Today, The Investment Management Division of Goldman Sachs serves a diverse set of clients worldwide, including private institutions, public entities and individuals. With portfolio management teams located around the world — and $664.4 billion in assets under management as of December 31, 2006 — our investment professionals bring firsthand knowledge of local markets to every investment decision, making us one of the few truly global asset managers.
GOLDMAN SACHS FUNDS |
In building a globally diversified portfolio, you can select from more than 50 Goldman Sachs Funds and gain access to investment opportunities across borders, investment styles, asset classes and security capitalizations.
Money Market Funds1 Fixed Income Funds ▪ Enhanced Income Fund ▪ Ultra-Short Duration Government Fund ▪ Short Duration Government Fund ▪ Short Duration Tax-Free Fund ▪ California Intermediate AMT-Free Municipal Fund ▪ New York Intermediate AMT-Free Municipal Fund ▪ Tennessee Municipal Fund ▪ Municipal Income Fund ▪ U.S. Mortgages Fund ▪ Government Income Fund ▪ Core Fixed Income Fund �� Core Plus Fixed Income Fund ▪ Investment Grade Credit Fund ▪ Global Income Fund ▪ High Yield Municipal Fund ▪ High Yield Fund ▪ Emerging Markets Debt Fund | Domestic Equity Funds ▪ Balanced Fund ▪ Growth and Income Fund ▪ Structured Large Cap Value Fund ▪ Large Cap Value Fund ▪ Structured U.S. Equity Fund ▪ Structured U.S. Equity Flex Fund ▪ Structured Large Cap Growth Fund ▪ Capital Growth Fund ▪ Strategic Growth Fund ▪ Concentrated Growth Fund ▪ Mid Cap Value Fund ▪ Growth Opportunities Fund ▪ Small/Mid Cap Growth Fund ▪ Structured Small Cap Equity Fund ▪ Small Cap Value Fund | International Equity Funds ▪ Structured International Equity Fund ▪ Structured International Equity Flex Fund ▪ Concentrated International Equity Fund 2 ▪ Japanese Equity Fund ▪ International Small Cap Fund ▪ Asia Equity Fund ▪ Emerging Markets Equity Fund ▪ BRIC Fund (Brazil, Russia, India, China) Asset Allocation Funds3 Specialty Funds3 ▪ U.S. Equity Dividend and Premium Fund ▪ Structured Tax-Managed Equity Fund ▪ Real Estate Securities Fund ▪ International Real Estate Securities Fund ▪ Tollkeeper FundSM ▪ Commodity Strategy Fund |
1 | An investment in a money market fund is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds. |
2 | Effective December 26, 2006 the International Equity Fund was renamed the Concentrated International Equity Fund. |
3 | Individual Funds within the Asset Allocation and Specialty categories will have various placement on the risk/return spectrum and may have greater or lesser risk than that indicated by the placement of the general Asset Allocation or Specialty category. |
The Goldman Sachs Tollkeeper FundSM is a registered service mark of Goldman, Sachs & Co.
GOLDMAN SACHS ASSET MANAGEMENT, L.P. 32 OLD SLIP, 32ND FLOOR, NEW YORK, NEW YORK 10005
TRUSTEES Ashok N. Bakhru, Chairman John P. Coblentz, Jr. Patrick T. Harker Mary Patterson McPherson Alan A. Shuch Richard P. Strubel | OFFICERS Kaysie P. Uniacke, President James A. Fitzpatrick, Vice President James A. McNamara, Vice President John M. Perlowski, Treasurer Peter V. Bonanno, Secretary |
GOLDMAN, SACHS & CO. Distributor and Transfer Agent | GOLDMAN SACHS ASSET MANAGEMENT, L.P. Investment Adviser |
Visit our Web site at www.goldmansachsfunds.com to obtain the most recent month-end returns.
The reports concerning the Funds included in this shareholder report may contain certain forward-looking statements about the factors that may affect the performance of the Funds in the future. These statements are based on Fund management’s predictions and expectations concerning certain future events and their expected impact on the Funds, such as performance of the economy as a whole and of specific industry sectors, changes in the levels of interest rates, the impact of developing world events, and other factors that may influence the future performance of the Funds. Management believes these forward-looking statements to be reasonable, although they are inherently uncertain and difficult to predict. Actual events may cause adjustments in portfolio management strategies from those currently expected to be employed.
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities and information regarding how a Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available (I) without charge, upon request by calling 1-800-526-7384 (for Retail Shareholders) or 1-800-621-2550 (for Institutional Shareholders); and (II) on the Securities and Exchange Commission Web site at http://www.sec.gov.
The Funds file their complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year on Form N-Q. Beginning the fiscal quarter ended November 30, 2004 and every first and third fiscal quarter thereafter, the Funds’ Form N-Q will become available on the SEC’s website at http://www.sec.gov within 60 days after the Funds’ first and third fiscal quarters. When available, the Funds’ Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. and information on the operation of the Public Reference Room may also be obtained by calling 1-800-SEC-0330. When available, Form N-Q may be obtained upon request and without charge by calling 1-800-526-7384 (for Retail Shareholders) or 1-800-621-2550 (for Institutional Shareholders).
The Capital Growth, Strategic Growth, Concentrated Growth and Growth Opportunities Funds may invest in foreign securities, which may be more volatile and less liquid than investment in U.S. securities and will be subject to the risks of currency fluctuations and sudden economic or political developments. At times, the Funds may be unable to sell certain of their portfolio securities without a substantial drop in price, if at all. The Small/ Mid Cap Growth Fund may also invest in foreign securities and emerging market securities. Foreign and emerging market securities may be more volatile than investment in U.S. securities and will be subject to the risks of currency fluctuations and political developments.
The Capital Growth, Strategic Growth, Concentrated Growth and Growth Opportunities Funds may participate in the Initial Public Offering (IPO) market, and a portion of the Funds’ returns consequently may be attributable to their investment in IPOs. The market value of IPO shares may fluctuate considerably due to factors such as the absence of a prior public market, unseasoned trading, and the small number of shares available for trading and limited information about the issuer. When a fund’s asset base is small, IPOs may have a magnified impact on the fund’s performance. As a fund’s assets grow, it is probable that the effect of the fund’s investment in IPOs on its total returns may not be as significant, which could reduce the fund’s performance.
Holdings and allocations shown may not be representative of current or future investments. Holdings and allocations may not include the Fund’s entire investment portfolio, which may change at any time. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities.
This material is not authorized for distribution to prospective investors unless preceded or accompanied by a current Prospectus. Please consider a Fund’s objectives, risks, and charges and expenses, and read the Prospectus carefully before investing. The Prospectus contains this and other information about the Funds.
Copyright 2007 Goldman, Sachs & Co. All rights reserved. 07-678 | GROWTHSAR / 147.9K /4-07 |
ITEM 2. | CODE OF ETHICS. |
(a) | As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party (the “Code of Ethics”). | |||
(b) | During the period covered by this report, no amendments were made to the provisions of the Code of Ethics. | |||
(c) | During the period covered by this report, the registrant did not grant any waivers, including an implicit waiver, from any provision of the Code of Ethics. | |||
(d) | A copy of the Code of Ethics is available as provided in Item 12(a)(1) of this report. |
ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. | |
The registrant’s board of trustees has determined that the registrant has at least one “audit committee financial expert” (as defined in Item 3 of Form N-CSR) serving on its audit committee. John P. Coblentz, Jr. is the “audit committee financial expert” and is “independent” (as each term is defined in Item 3 of Form N-CSR). |
ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. | |
N/A |
ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. | |
Not applicable. |
ITEM 6. | SCHEDULE OF INVESTMENTS. | |
Schedule of Investments is included as part of the Report to Stockholders filed under Item 1. |
ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. |
ITEM 8. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. | |
Not applicable. |
ITEM 9. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. | |
Not applicable. |
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. | |
ITEM 11. | CONTROLS AND PROCEDURES. | |
(a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report that includes the disclosure required by this paragraph, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934, as amended. | ||
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant’s second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. | ||
ITEM 12. | EXHIBITS. |
(a)(1) | Goldman Sachs Trust’s Code of Ethics for Principal Executive and Senior Financial Officers is incorporated by reference to Exhibit 11(a)(1) of the registrant’s Form N-CSR filed on March 8, 2004 for its Real Estate Securities Fund (Accession Number 0000950123-04-0002984). | ||
(a)(2) | Exhibit 99.CERT | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 filed herewith. | ||
(b) | Exhibit 99.906CERT | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 filed herewith. |
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. |
Goldman Sachs Trust | ||||||
By: | /s/ Kaysie P. Uniacke | |||||
Kaysie P. Uniacke | ||||||
President/Principal Executive Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2007 |
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/ Kaysie P. Uniacke | |||||
Kaysie P. Uniacke | ||||||
President/Principal Executive Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2007 | |||||
By: | /s/ John M. Perlowski | |||||
John M. Perlowski | ||||||
Treasurer/Principal Financial Officer | ||||||
Goldman Sachs Trust | ||||||
Date: | May 9, 2007 |