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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 811-01604
Pioneer Growth Shares Fund
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: December 31
Date of reporting period: January 1, 2005 through June 30, 2005
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
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Pioneer
-------
GROWTH
SHARES
Semiannual
Report
6/30/05
[LOGO] PIONEER
Investments(R)
Table of Contents
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Letter to Shareowners 1
Portfolio Summary 2
Prices and Distributions 3
Performance Update 4
Comparing Ongoing Fund Expenses 10
Portfolio Management Discussion 12
Schedule of Investments 16
Financial Statements 22
Notes to Financial Statements 32
Factors Considered by the Independent Trustees in Approving
the Management Contract 40
Trustees, Officers and Service Providers 46
The Pioneer Family of Mutual Funds 47
Retirement Plans from Pioneer 48
Pioneer Growth Shares
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LETTER TO SHAREOWNERS 6/30/05
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Dear Shareowner,
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The U.S. economy has expanded at an annualized rate of at least three percent
for eight straight quarters, a feat it last achieved in the 1980s. Job
conditions are strengthening as well: by mid-year, the unemployment rate had
fallen to 5.0% for the first time since September 11, 2001. Retail sales trends
- - apart from automobiles - were upbeat as sunnier employment prospects sent
consumers to the malls. And with the economy expanding, corporate profits have
been moving ahead smartly.
But equity investors were unconvinced by this evidence and instead brooded
about the possibility of slowing growth later in the year. For one thing,
expectations were for a moderating pace of profit growth. For another, the
Federal Reserve Board has raised short-term interest rates nine times. And some
areas of the economy are feeling the impact of record high energy prices. So
investors were lukewarm toward stocks, with modest losses in the S&P 500 Stock
Index and the Dow Jones Industrials the result. The technology-heavy NASDAQ
Composite also slid, as did small-company stocks, as measured by the Russell
2000 Index. Value stocks, viewed as less vulnerable to declines in a less
robust economy, held up better than growth.
Corporate bonds felt the sting of ratings downgrades in the automobile sector.
Treasury issues fared better, as yields fell and prices rose among intermediate
and longer-term issues, which were little affected by rising short-term rates.
Low long-term yields may signal investor confidence that the Fed will succeed
in dousing inflationary fires; they also brought more affordable mortgages,
further boosting home construction. Municipal revenue bonds edged upward as
healthier economic conditions bolstered tax collections.
The dollar's rebound positively affected foreign markets. Europe's stock
markets performed better than business and political conditions might suggest,
and Japan's market inched higher.
Pioneer's analysts believe that, although the rate of growth may slow,
carefully selected, good quality stocks and bonds have the potential to deliver
solid results. Our global investment experts are well positioned to discover
what we believe are attractive opportunities in the world's markets.
Large or small? Bonds or stocks? Domestic or international?
Just what your mix of investments should be isn't a question to be taken
lightly. Much of your long-term return will depend on the kinds of investments
you own, not just the individual items in your portfolio. For an analysis of
your holdings and some ideas to help bring your investments in line with your
aspirations, talk to your financial professional.
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about each fund and should be read carefully before you invest or send money.
To obtain a prospectus and for other information on any Pioneer fund, contact
your financial advisor, call 1-800-225-6292 or visit our web site at
www.pioneerfunds.com.
Respectfully,
/s/ Osbert M. Hood
Osbert M. Hood
President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
1
Pioneer Growth Shares
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PORTFOLIO SUMMARY 6/30/05
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Portfolio Diversification
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[THE FOLLOWING WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL.]
(As a percentage of total investment portfolio)
U.S Common Stocks 90.7%
Temporary Cash Investment 2.0%
Despositary Receipts of International Stocks 7.3%
[THE FOLLOWING WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL.]
Sector Distribution
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(As a percentage of equity holdings)
Information Technology 32.9%
Health Care 21.0%
Consumer Discretionary 15.6%
Consumer Staples 12.7%
Industrials 7.8%
Financials 6.7%
Telecommunication Services 1.7%
Energy 1.6%
10 Largest Holdings
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(As a percentage of equity holdings)
1. Microsoft Corp. 5.78%
2. Cisco Systems, Inc. 4.03
3. Symantec Corp. 3.67
4. PepsiCo, Inc. 3.17
5. Procter & Gamble, Co. 3.10
6. Amgen, Inc. 3.00
7. Qualcomm, Inc. 2.95
8. Lowe's Companies, Inc. 2.79
9. Altria Group, Inc. 2.67
10. Cardinal Health, Inc. 2.60
This list excludes temporary cash and derivative instruments. Portfolio
holdings will vary for other periods.
2
Pioneer Growth Shares
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PRICES AND DISTRIBUTIONS
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Net Asset Value Per Share
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Class 6/30/05 12/31/04
----- ------- --------
A $11.86 $12.13
B $10.81 $11.11
C $10.93 $11.23
R $11.84 $12.12
Y $12.46 $12.70
Investor Class $11.90 $12.14
Distributions Per Share
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1/1/05 - 6/30/05
----------------
Net
Investment Short-Term Long-Term
Class Income Capital Gains Capital Gains
----- ------ ------------- -------------
A $ - $ - $ -
B $ - $ - $ -
C $ - $ - $ -
R $ - $ - $ -
Y $ - $ - $ -
Investor Class $ - $ - $ -
3
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 CLASS A SHARES
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Growth Shares, compared to that of the Russell 1000
Growth Index.
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Average Annual Total Returns
(As of June 30, 2005)
Net Asset Public
Value Offering
Period (NAV) Price (POP)
10 Years 6.27% 5.65%
5 Years -8.77 -9.84
1 Year 5.31 -0.77
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Jun-95 9,425 10,000
11,346 12,782
Jun-97 17,022 16,785
23,984 22,052
Jun-99 28,581 28,066
27,416 35,267
Jun-01 22,826 22,510
15,047 16,548
Jun-03 15,047 17,033
16,448 20,080
Jun-05 17,322 20,421
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
NAV results represent the percent change in net asset value per share. Returns
would have been lower had sales charges been reflected. POP returns reflect
deduction of maximum 5.75% sales charge. All results are historical and assume
the reinvestment of dividends and capital gains. Other share classes are
available for which performance and expenses will differ. Performance results
reflect any applicable expense waivers in effect during the periods shown.
Without such waivers Fund performance would be lower. Waivers may not be in
effect for all funds. Certain fee waivers are contractual through a specified
period. Otherwise, fee waivers can be rescinded at any time. See the prospectus
and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The Russell 1000 Growth Index measures the performance of large-cap U.S. growth
stocks. Companies in this index tend to exhibit higher price-to-book and
price-to-earnings ratios, lower dividend yields and higher forecasted growth
values than the value universe. Index returns assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in an Index.
4
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 CLASS B SHARES
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Growth Shares, compared to that of the Russell 1000
Growth Index.
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Average Annual Total Returns
(As of June 30, 2005)
If If
Period Held Redeemed
10 Years 5.42% 5.42%
5 Years -9.56 -9.56
1 Year 4.44 0.44
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Jun-95 10,000 10,000
11,962 12,782
Jun-97 17,810 16,785
24,885 22,052
Jun-99 29,419 28,066
28,000 35,267
Jun-01 23,138 22,510
15,143 16,548
Jun-03 15,002 17,033
16,225 20,080
Jun-05 16,946 20,421
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
"If Held" results represent the percent change in net asset value per share.
Returns would have been lower had sales charges been reflected. "If redeemed"
returns reflect the deduction of applicable contingent deferred sales charge
(CDSC). Effective December 1, 2004, the period during which a CDSC is applied to
withdrawals was shortened to 5 years. The maximum CDSC for class B shares
continues to be 4%. For more complete information, please see the prospectus for
details. Note: Shares purchased prior to December 1, 2004 remain subject to the
CDSC in effect at the time you purchased those shares. For performance
information for shares purchased prior to December 1, 2004, please visit
www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital
gains. Other share classes are available for which performance and expenses will
differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers may
not be in effect for all funds. Certain fee waivers are contractual through a
specified period. Otherwise, fee waivers can be rescinded at any time. See the
prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The Russell 1000 Growth Index measures the performance of large-cap U.S. growth
stocks. Companies in this index tend to exhibit higher price-to-book and
price-to-earnings ratios, lower dividend yields and higher forecasted growth
values than the value universe. Index returns assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in an Index.
5
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 CLASS C SHARES
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Growth Shares, compared to that of the Russell 1000
Growth Index.
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Average Annual Total Returns
(As of June 30, 2005)
If If
Period Held Redeemed
Life of Class
(1/31/96) 4.55% 4.55%
5 Years -9.49 -9.49
1 Year 4.49 4.49
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Jan-96 10,000 10,000
10,627 10,845
Jun-97 15,888 14,242
22,229 18,710
Jun-99 26,303 23,813
25,019 29,923
Jun-01 20,678 19,099
13,544 14,041
Jun-03 13,419 14,452
14,546 17,037
Jun-05 15,199 17,327
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Class C shares held for less than one year are also subject to a 1% contingent
deferred sales charge (CDSC). The performance of Class C shares does not reflect
the 1% front-end sales charge in effect prior to February 1, 2004. If you paid a
1% sales charge, your returns would be lower than those shown above. "If Held"
results represent the percent change in net asset value per share. Returns would
have been lower had sales charges been reflected. All results are historical and
assume the reinvestment of dividends and capital gains. Other share classes are
available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers may
not be in effect for all funds. Certain fee waivers are contractual through a
specified period. Otherwise, fee waivers can be rescinded at any time. See the
prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The Russell 1000 Growth Index measures the performance of large-cap U.S. growth
stocks. Companies in this index tend to exhibit higher price-to-book and
price-to-earnings ratios, lower dividend yields and higher forecasted growth
values than the value universe. Index returns assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in an Index.
6
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 INVESTOR CLASS SHARES
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Investment Returns
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Average Annual Total Returns
(As of June 30, 2005)
If If
Period Held Redeemed
Life-of-Class
(12/11/04) 1.19% 1.19%
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Dec-04 10,000 10,000
Jun-05 9,802 9,828
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Certain Pioneer funds (the "Funds") issued Investor Class shares in connection
with the reorganization of Safeco mutual funds. The Funds are not offering
additional Investor Class shares except in connection with the reinvestment of
dividends on the Funds' outstanding Investor Class shares. All Investor Class
shares of the Funds, whenever issued, convert to Class A shares of their
respective Funds on December 10, 2006. Investor Class shares are not subject to
sales charges.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers may
not be in effect for all funds. Certain fee waivers are contractual through a
specified period. Otherwise, fee waivers can be rescinded at any time. See the
prospectus and financial statements for more information.
The performance table does not reflect the deduction of fees and taxes that a
shareowner would pay on Fund distributions or the redemption of Fund shares.
7
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 CLASS R SHARES
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Growth Shares Fund, compared to that of the Russell
1000 Growth Index.
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Average Annual Total Returns
(As of June 30, 2005)
If If
Period Held Redeemed
10 Years 5.87% 5.87%
5 Years -9.00 -9.00
1 Year 5.28 5.28
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Jun-95 10,000 10,000
11,964 12,782
Jun-97 17,857 16,785
25,045 22,052
Jun-99 29,702 28,066
28,348 35,267
Jun-01 23,482 22,510
15,402 16,548
Jun-03 15,357 17,033
16,801 20,080
Jun-05 17,688 20,421
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
The performance of Class R shares for the period prior to the commencement of
operations of Class R shares on April 1, 2003 is based on the performance of
Class A shares, reduced to reflect the higher distribution and service fees of
Class R shares. For the period after April 1, 2003, the actual performance of
Class R shares is reflected, which performance may be influenced by the smaller
asset size of Class R shares compared to Class A shares. Class R shares are not
subject to sales charges and are available for limited groups of eligible
investors, including institutional investors. All results are historical and
assume the reinvestment of dividends and capital gains. Other share classes are
available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers may
not be in effect for all funds. Certain fee waivers are contractual through a
specified period. Otherwise, fee waivers can be rescinded at any time. See the
prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The Russell 1000 Growth Index measures the performance of large-cap U.S. growth
stocks. Companies in this index tend to exhibit higher price-to-book and
price-to-earnings ratios, lower dividend yields and higher forecasted growth
values than the value universe. Index returns assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in an Index.
8
Pioneer Growth Shares
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PERFORMANCE UPDATE 6/30/05 CLASS Y SHARES
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Investment Returns
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The mountain chart on the right shows the change in value of a $10,000
investment made in Pioneer Growth Shares, compared to that of the Russell 1000
Growth Index.
- --------------------------------------------------------------------------------
Average Annual Total Returns
(As of June 30, 2005)
If If
Period Held Redeemed
10 Years 6.85% 6.85%
5 Years -8.14 -8.14
1 Year 6.12 6.12
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[THE FOLLOWING WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
Pioneer Growth Russell 1000
Shares Growth Index
Jun-95 10,000 10,000
12,035 12,782
Jun-97 18,055 16,785
25,453 22,052
Jun-99 30,459 28,066
29,642 35,267
Jun-01 24,855 22,510
16,482 16,548
Jun-03 16,606 17,033
18,274 20,080
Jun-05 19,393 20,421
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
The performance data quoted represents past performance, which is no guarantee
of future results. Investment return and principal value will fluctuate, and
shares, when redeemed, may be worth more or less than their original cost.
Performance for periods prior to the inception of Class Y shares reflects the
NAV performance of the Fund's A shares. The performance does not reflect
differences in expenses, including the Rule 12b-1 fees applicable to A shares.
Since fees for Class A shares are generally higher than those of Class Y shares,
the performance shown for Class Y shares prior to their inception would have
been higher. Class A shares are used as a proxy through 4/30/98. Class Y shares
are not subject to sales charges and are available for limited groups of
eligible investors, including institutional investors. All results are
historical and assume the reinvestment of dividends and capital gains. Other
share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the
periods shown. Without such waivers Fund performance would be lower. Waivers may
not be in effect for all funds. Certain fee waivers are contractual through a
specified period. Otherwise, fee waivers can be rescinded at any time. See the
prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Fund distributions or the redemption of Fund
shares.
The Russell 1000 Growth Index measures the performance of large-cap U.S. growth
stocks. Companies in this index tend to exhibit higher price-to-book and
price-to-earnings ratios, lower dividend yields and higher forecasted growth
values than the value universe. Index returns assume reinvestment of dividends
and, unlike Fund returns, do not reflect any fees, expenses or sales charges.
You cannot invest directly in an Index.
9
Pioneer Growth Shares
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COMPARING ONGOING FUND EXPENSES
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As a shareowner in the Fund, you incur two types of costs:
(1) ongoing costs, including management fees, distribution and/or service
(12b-1) fees, and other Fund expenses; and
(2) transaction costs, including sales charges (loads) on purchase payments.
This example is intended to help you understand your ongoing expenses (in
dollars) of investing in the Fund 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 at the beginning of the Fund's latest six-month period and held
throughout the six months.
Using the Tables
Actual Expenses
The first table below provides information about actual account values and
actual expenses. You may use the information in this table, together with the
amount you invested, to estimate the expenses that you paid over the period as
follows:
1. Divide your account value by $1,000
Example: an $8,600 account value [divided by] $1,000 = 8.6
2. Multiply the result in (1) above by the corresponding share class's number
in the third row under the heading entitled "Expenses Paid During Period"
to estimate the expenses you paid on your account during this period.
Expenses Paid on a $1,000 Investment in Pioneer Growth Shares
Based on actual returns from January 1, 2005 through June 30, 2005
Investor
Share Class A B C Class R Y
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Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 1/1/05
Ending Account Value $ 977.70 $ 973.00 $ 973.30 $ 960.90 $ 976.90 $ 981.10
On 6/30/05
Expenses Paid During Period* $ 6.77 $ 11.30 $ 10.72 $ 4.28 $ 7.65 $ 3.44
* Expenses are equal to the Fund's annualized expense ratio of 1.38%, 2.31%,
2.19%, 1.56%, 0.70%, and 0.88%, for Class A, Class B, Class C, Class R,
Class Y and Investor Class shares, respectively, multiplied by the average
account value over the period, multiplied by 181/365 (to reflect the
one-half year period).
10
Pioneer Growth Shares
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Hypothetical Example for Comparison Purposes
The table below provides information about hypothetical account values and
hypothetical expenses based on the Fund's actual expense ratio and an assumed
rate of return of 5% per year before expenses, which is not the Fund's 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
Fund 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 tables are meant to highlight your
ongoing costs only and do not reflect any transaction costs, such as sales
charges (loads) that are charged at the time of the transaction. Therefore, the
table below 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 transaction costs were included, your costs would have been higher.
Expenses Paid on a $1,000 Investment in Pioneer Growth Shares
Based on a hypothetical 5% return per year before expenses, reflecting the
period from January 1, 2005 through June 30, 2005
Investor
Share Class A B C Class R Y
- ----------------------------------------------------------------------------------------------------------
Beginning Account Value $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
On 1/1/05*
Ending Account Value $1,017.95 $1,013.34 $1,013.93 $1,020.43 $1,017.06 $1,021.32
On 6/30/05
Expenses Paid During Period* $ 6.90 $ 11.53 $ 10.94 $ 4.41 $ 7.80 $ 3.51
* Expenses are equal to the Fund's annualized expense ratio of 1.38%, 2.31%,
2.19%, 1.56%, 0.70, and 0.88%, for Class A, Class B, Class C, Class R,
Class Y and Investor Class shares, respectively, multiplied by the average
account value over the period, multiplied by 181/365 (to reflect the
one-half year period).
11
Pioneer Growth Shares
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 6/30/05
- --------------------------------------------------------------------------------
Large company growth stocks slumped early in 2005 before staging a comeback in
May and June. However, the comeback was not sufficient to avoid negative results
for growth stocks for the six months ended June 30, 2005. In the following
interview, Christopher Galizio discusses the factors that affected the
performance of Pioneer Growth Shares during the six months ended June 30, 2005.
Mr. Galizio is one of the co-managers responsible for day-to-day portfolio
management of the Fund.
Q: How did the Fund perform during the six months ended June 30, 2005?
A: Performance slightly lagged that of the large-cap growth universe,
principally because of poor results from a few holdings. For the first six
months of 2005, the Fund's Class A shares had a total return at net asset
value of -2.23%. During the same six months, the Russell 1000 Growth Index
returned -1.72%, while the average return of the 670 funds in Lipper's
Large Cap Growth Fund category was -1.75%.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Q: What were the principal factors affecting the Fund's results for the period?
A: We made good sector allocations during the six months, helping to support
Fund performance. We began 2005 with an emphasis on the cyclical sectors,
notably the materials, industrials and energy areas. We saw that the
economy was continuing to recover and a number of shortages were occurring
in commodity markets, including copper. After these stocks rallied in the
early months of the year, we took profits and reduced our positions
substantially, even eliminating the Fund's materials investments. We
believed the share prices of many of these companies had gone higher than
we thought the corporations' values merited, and we decided to sell into
strong demand. We were concerned that market interest rates - which had
been declining despite the tightening policies of
12
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
the U.S. Federal Reserve Board - finally would begin to rise, adversely
affecting cyclical stocks. Our worry about the risk of higher interest
rates also prompted us to reduce our investments in consumer discretionary
stocks, especially retailers. As we did this, we moved from cyclical
stocks into other growth stocks, including information technology and
health care. Both those sectors went from being underweighted (relative to
the Fund's benchmark) to being emphasized over the course of the six
months. In general, we believed it was time to move into companies with
long-term growth prospects not dependent on cyclical movements in the
economy or in commodity prices or interest rates. As we added to our
information technology investments, we established positions in leading
technology companies, such as Qualcomm and Cisco Systems.
Q: What were some of the individual investments that helped support performance?
A: Our investment in Texas Instruments was a major help to performance as it
appreciated significantly with improved earnings prospects of its
semiconductors and wireless phones and the introduction of a new
generation of wireless telecommunications technology.
Two of our best decisions were to avoid or de-emphasize major companies
that were significant parts of the Russell 1000 Growth Index. We
completely avoided any IBM stock, which declined by 20% during the six
months. We also limited exposure to Internet auction company eBay, whose
growth slowed and revenues declined in the face of new competition. eBay's
stock declined 41% over the period.
Two generic drug manufacturers turned in stellar performance for the
period. Both IVAX and Endo Pharmaceutical rose with the improving outlook
for generic manufacturers as several major drugs were scheduled to lose
their patent protection in the near future. Both firms also had
company-specific issues that gave their share prices extra support. IVAX
received FDA approval of a new technology for inhalers for asthma patients
that does not pose a danger to the ozone layer, while Endo won a court
case challenging another company's claimed patent for the pain reliever
oxycontin.
13
Pioneer Growth Shares
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 6/30/05 (continued)
- --------------------------------------------------------------------------------
Other strong performers included copper miners Phelps Dodge and
Freeport-McMoRan, both of which we sold before the period ended, Altria
Group, which won a court fight in a tobacco liability suit in which it was
a defendant, and Hewlett-Packard, which gained on news of the appointment
of a new chief executive.
Q: What were some of the investments that held back performance?
A: The biggest disappointment was Avaya, the producer of enterprise telephone
systems for large corporations and other major institutions, whose stock
price declined by 50%. Avaya offers large enterprises both traditional
phone equipment as well as a newer technology that helps institutions
transition to Internet-based phone systems. However, sales of the
traditional equipment lagged, while the new technology failed to meet
expectations. Despite the disappointment, we have retained the position,
as the stock price has become very inexpensive and we still think the
company has potential for significant earnings improvement.
We also continue to own another notable detractor, information technology
consulting company Accenture. The company reported disappointing earnings
because one of its major contracts produced lower revenues than had been
anticipated. However, we think this was a short-term problem and that the
company has the potential to recover.
Another disappointment was American International Group, the giant
insurer, whose stock price plummeted in the midst of an SEC investigation
into its finances that resulted in the forced resignation of its long-time
chief executive.
Not owning Intel was another decision that detracted from results. We did
not view Intel, which produces 80% of the semiconductors for personal
computers, as a true growth stock. However, the stock rose by 15% for the
six months as the company successfully drove down its costs and improved
its profitability. Similarly, not owning Pfizer, Johnson & Johnson and
Genentech, all major companies in the health care sector, held back
performance as all three did well.
14
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Q: What is your outlook for the coming months?
A: We believe the best opportunities will come from investments in secular, or
long-term, growth companies, that are less sensitive to interest rates and
the business cycle than are cyclical companies. We think interest rates
are very low and due to start rising, while oil and basic materials prices
may be vulnerable to price corrections.
We have seen particular value in the information technology and health
care companies, which have the potential to produce more consistent
earnings.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of the opinion of Fund management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
15
Pioneer Growth Shares
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/05 (unaudited)
- --------------------------------------------------------------------------------
Shares Value
COMMON STOCKS - 99.8%
Energy - 1.6%
Integrated Oil & Gas - 1.6%
71,300 Occidental Petroleum Corp. $ 5,485,109
171,800 Repsol SA (A.D.R.) (b) 4,317,334
------------
$ 9,802,443
------------
Total Energy $ 9,802,443
------------
Capital Goods - 7.1%
Aerospace & Defense - 1.7%
57,600 L-3 Communications Holdings, Inc. $ 4,411,008
118,600 United Technologies Corp. 6,090,110
------------
$ 10,501,118
------------
Building Products - 1.2%
170,120 American Standard Companies, Inc. $ 7,131,430
------------
Construction & Farm Machinery & Heavy Trucks - 1.7%
156,900 Deere & Co. $ 10,275,381
------------
Industrial Conglomerates - 1.3%
278,700 Tyco International, Ltd. $ 8,138,040
------------
Industrial Machinery - 1.2%
89,700 Illinois Tool Works, Inc. $ 7,147,296
------------
Total Capital Goods $ 43,193,265
------------
Commercial Services & Supplies - 0.7%
Diversified Commercial Services - 0.7%
71,400 The Dun & Bradstreet Corp.* $ 4,401,810
------------
Total Commercial Services & Supplies $ 4,401,810
------------
Consumer Durables & Apparel - 0.8%
Apparel, Accessories & Luxury Goods - 0.8%
120,400 Liz Claiborne, Inc. $ 4,787,104
------------
Total Consumer Durables & Apparel $ 4,787,104
------------
Consumer Services - 1.8%
Education Services - 1.0%
80,900 Apollo Group, Inc.* $ 6,327,998
------------
16 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Hotels, Resorts & Cruise Lines - 0.8%
86,100 Carnival Corp. $ 4,696,755
------------
Total Consumer Services $ 11,024,753
------------
Media - 4.5%
Advertising - 0.9%
70,300 Omnicom Group $ 5,614,158
------------
Broadcasting & Cable TV - 2.2%
1,314,600 Liberty Media Corp.* $ 13,395,774
------------
Movies & Entertainment - 1.4%
343,040 The Walt Disney Co. $ 8,637,747
------------
Total Media $ 27,647,679
------------
Retailing - 8.5%
Apparel Retail - 2.6%
131,200 Aeropostale, Inc.* $ 4,408,320
472,500 TJX Companies, Inc. 11,505,375
------------
$ 15,913,695
------------
Computer & Electronics Retail - 1.2%
106,900 Best Buy Co., Inc. $ 7,327,995
------------
Home Improvement Retail - 4.7%
304,900 Home Depot, Inc. $ 11,860,610
292,300 Lowe's Companies, Inc. 17,017,706
------------
$ 28,878,316
------------
Total Retailing $ 52,120,006
------------
Food, Beverage & Tobacco - 7.4%
Soft Drinks - 4.8%
166,300 Fomento Economico Mexicano SA de C.V. $ 9,906,491
358,250 PepsiCo, Inc. 19,320,423
------------
$ 29,226,914
------------
Tobacco - 2.6%
251,600 Altria Group, Inc. $ 16,268,456
------------
Total Food, Beverage & Tobacco $ 45,495,370
------------
Household & Personal Products - 5.2%
Household Products - 3.1%
358,200 Procter & Gamble Co. $ 18,895,050
------------
The accompanying notes are an integral part of these financial statements. 17
Pioneer Growth Shares
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Personal Products - 2.1%
344,700 Avon Products, Inc. $ 13,046,895
------------
Total Household & Personal Products $ 31,941,945
------------
Health Care Equipment & Services - 8.4%
Health Care Distributors - 2.6%
275,700 Cardinal Health, Inc. $ 15,874,806
------------
Health Care Equipment - 4.9%
247,900 Biomet, Inc. $ 8,587,256
415,700 Boston Scientific Corp.* 11,223,900
144,550 Guidant Corp. 9,728,215
------------
$ 29,539,371
------------
Health Care Services - 0.9%
229,500 IMS Health, Inc. (b) $ 5,684,715
------------
Total Health Care Equipment & Services $ 51,098,892
------------
Pharmaceuticals & Biotechnology - 12.6%
Biotechnology - 4.7%
302,800 Amgen, Inc.* $ 18,307,288
111,500 Biogen Idec, Inc.*(b) 3,841,175
146,500 Gilead Sciences, Inc.* 6,444,535
------------
$ 28,592,998
------------
Pharmaceuticals - 7.9%
207,100 AstraZeneca Plc (A.D.R.) $ 8,544,946
235,600 Bristol-Myers Squibb Co. 5,885,288
380,691 Endo Pharmaceuticals Holdings, Inc.* 10,004,559
557,100 IVAX Corp.* 11,977,650
117,600 Merck & Co., Inc. 3,622,080
255,596 Par Pharmaceutical Co., Inc.* 8,130,509
------------
$ 48,165,032
------------
Total Pharmaceuticals & Biotechnology $ 76,758,030
------------
Banks - 1.3%
Diversified Banks - 1.3%
162,900 Wachovia Corp. $ 8,079,840
------------
Total Banks $ 8,079,840
------------
18 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Shares Value
Diversified Financials - 3.2%
Consumer Finance - 0.8%
60,100 Capital One Financial Corp. (b) $ 4,808,601
------------
Diversified Financial Services - 2.4%
314,750 Citigroup, Inc. $ 14,550,893
------------
Total Diversified Financials $ 19,359,494
------------
Insurance - 2.2%
Multi-Line Insurance - 2.2%
231,500 American International Group, Inc. $ 13,450,150
------------
Total Insurance $ 13,450,150
------------
Software & Services - 13.1%
IT Consulting & Other Services - 2.0%
533,900 Accenture, Ltd.* $ 12,103,513
------------
Systems Software - 11.1%
1,419,300 Microsoft Corp. $ 35,255,412
453,800 Macrovision Corp.* 10,228,652
1,028,900 Symantec Corp.* 22,368,286
------------
$ 67,852,350
------------
Total Software & Services $ 79,955,863
------------
Technology Hardware & Equipment - 16.9%
Communications Equipment - 8.8%
1,323,300 Avaya, Inc.* $ 11,009,856
1,287,400 Cisco Systems, Inc.* 24,602,214
544,600 Qualcomm, Inc. 17,977,246
------------
$ 53,589,316
------------
Computer Hardware - 4.3%
368,900 Dell, Inc.* $ 14,575,239
507,500 Hewlett-Packard Co. 11,931,325
------------
$ 26,506,564
------------
Computer Storage & Peripherals - 1.7%
441,800 Sandisk Corp.* $ 10,483,914
------------
Electronic Equipment & Instruments - 2.1%
52,700 Samsung Electronics $ 12,634,825
------------
Total Technology Hardware & Equipment $103,214,619
------------
The accompanying notes are an integral part of these financial statements. 19
Pioneer Growth Shares
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 6/30/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Shares Value
Semiconductors - 2.9%
90,700 Linear Technology Corp. $ 3,327,783
506,800 Texas Instruments, Inc. 14,225,876
------------
$ 17,553,659
------------
Total Semiconductors $ 17,553,659
------------
Telecommunication Services - 1.7%
Wireless Telecommunication Services - 1.7%
424,200 Vodafone Group Plc (A.D.R.) $ 10,316,544
------------
Total Telecommunication Services $ 10,316,544
------------
TOTAL COMMON STOCKS
(Cost $596,408,514) $610,201,466
------------
TEMPORARY CASH INVESTMENT - 2.0%
Security Lending Collateral - 2.0%
12,270,082 Securities Lending Investment Fund, 3.29% $ 12,270,082
------------
TOTAL TEMPORARY CASH INVESTMENT
(Cost $12,270,082) $ 12,270,082
------------
TOTAL INVESTMENTS IN SECURITIES - 101.8%
(Cost $608,678,595)(a) $622,471,548
------------
OTHER ASSETS AND LIABILITIES - (1.8)% $(11,132,095)
------------
TOTAL NET ASSETS - 100.0% $611,339,453
============
(A.D.R.) American Depositary Receipt
* Non-income producing security
(a) At June 30, 2005, the net unrealized gain on investments based on cost for federal income
tax purposes of $620,513,399 was as follows:
Aggregate gross unrealized gain for all investments in which
there is an excess of value over tax cost $ 28,462,092
Aggregate gross unrealized loss for all investments in which
there is an excess of tax cost over value (26,503,943)
------------
Net unrealized gain $ 1,958,149
============
20 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(b) At June 30, 2005, the following securities were out on loan:
Market
Shares Security Value
68,300 Biogen Idec, Inc. $ 2,352,935
52,835 Capital One Financial Corp. 4,227,328
66,309 IMS Health, Inc. 1,642,474
158,280 Repsol SA (A.D.R.) 3,977,576
-----------
Total $12,200,313
===========
Purchases and sales of securities (excluding temporary cash investments)
for the six months ended June 30, 2005 aggregated $272,006,108 and
$359,989,381, respectively.
The accompanying notes are an integral part of these financial statements. 21
Pioneer Growth Shares
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 6/30/05 (unaudited)
- --------------------------------------------------------------------------------
ASSETS:
Investment in securities (including securities loaned of
$12,200,313) (cost $608,678,595) $ 622,471,548
Receivables -
Investment securities sold 7,597,327
Fund shares sold 169,036
Dividends, interest and foreign taxes withheld 662,553
Other 851
--------------
Total assets $ 630,901,315
--------------
LIABILITIES:
Payables -
Investment securities purchased $ 3,382,047
Fund shares repurchased 914,385
Upon return of securities loaned 12,270,082
Due to bank 2,326,407
Due to affiliates 563,485
Accrued expenses 105,456
--------------
Total liabilities $ 19,561,862
--------------
NET ASSETS:
Paid-in capital $1,151,429,669
Accumulated net investment loss (1,367,862)
Accumulated net realized loss on investments (552,515,307)
Net unrealized gain on investments 13,792,953
--------------
Total net assets $ 611,339,453
==============
NET ASSET VALUE PER SHARE:
(No par value, unlimited number of shares authorized)
Class A (based on $417,138,746/35,172,150 shares) $ 11.86
==============
Class B (based on $148,195,493/13,714,895 shares) $ 10.81
==============
Class C (based on $41,822,740/3,826,177 shares) $ 10.93
==============
Investor Class (based on $1,292,884/108,686 shares) $ 11.90
==============
Class R (based on $306,414/25,889 shares) $ 11.84
==============
Class Y (based on $2,583,176/207,385 shares) $ 12.46
==============
MAXIMUM OFFERING PRICE:
Class A ($11.86 [divided by] 94.25%) $ 12.58
==============
22 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS (unaudited)
- --------------------------------------------------------------------------------
For the Six Months Ended 6/30/05
INVESTMENT INCOME:
Dividends (net of foreign taxes withheld of $50,920) $3,903,520
Income from securities loaned, net 3,792
----------
Total investment income $ 3,907,312
------------
EXPENSES:
Management fees
Basic Fee $2,218,489
Performance Adjustment (256,428)
Transfer agent fees and expenses
Class A 1,016,922
Class B 505,187
Class C 114,840
Investor Class 4,361
Class R 540
Class Y 226
Distribution fees
Class A 514,212
Class B 790,382
Class C 221,947
Class R 778
Administrative reimbursements 66,009
Custodian fees 19,500
Registration fees 54,832
Professional fees 33,980
Printing expense 41,486
Fees and expenses of nonaffiliated trustees 8,731
Miscellaneous 22,710
----------
Total expenses $ 5,378,704
Less fees paid indirectly (30,655)
------------
Net expenses $ 5,348,049
------------
Net investment loss $ (1,440,737)
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments $ 22,682,686
Change in net unrealized gain on investments $(38,495,525)
------------
Net loss on investments $(15,812,839)
------------
Net decrease in net assets resulting from operations $(17,253,576)
============
The accompanying notes are an integral part of these financial statements. 23
Pioneer Growth Shares
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Six Months Ended 6/30/05 and the Year Ended 12/31/04
Six Months
Ended
6/30/05 Year Ended
(unaudited) 12/31/04
FROM OPERATIONS:
Net investment income (loss) $ (1,440,737) $ 424,918
Net realized gain on investments 22,682,686 34,478,680
Change in net unrealized gain (loss) on investments (38,495,525) 2,090,357
-------------- --------------
Net increase (decrease) in net assets resulting
from operations $ (17,253,576) $ 36,993,955
-------------- --------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income:
Class A ($0.00 and $0.01 per share, respectively) $ - $ (329,850)
Class R ($0.00 and $0.09 per share, respectively) - (1,102)
Class Y ($0.00 and $0.05 per share, respectively) - (21,091)
-------------- --------------
Total distributions to shareowners $ - $ (352,043)
-------------- --------------
FROM FUND SHARE TRANSACTIONS:
Net proceeds from sale of shares $ 30,306,336 $ 79,782,136
Shares issued in reorganization - 6,560,837
Reinvestment of distributions - 314,534
Cost of shares repurchased (113,222,154) (201,109,917)
-------------- --------------
Net decrease in net assets resulting from
Fund share transactions $ (82,915,818) $ (114,452,410)
-------------- --------------
Net decrease in net assets $ (100,169,394) $ (77,810,498)
NET ASSETS:
Beginning of period 711,508,847 789,319,345
-------------- --------------
End of period (including accumulated undistributed
net investment income (loss) of ($1,367,862)
and $72,875 respectively) $ 611,339,453 $ 711,508,847
============== ==============
24 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
'05 Shares '05 Amount '04 Shares '04 Amount
(unaudited) (unaudited)
CLASS A
Shares sold 1,619,876 $ 19,153,198 4,474,485 $ 50,703,873
Reinvestment of distributions - - 26,505 312,497
Less shares repurchased (5,599,097) (66,253,218) (10,548,481) (118,146,700)
---------- ------------ ----------- -------------
Net decrease (3,979,221) $(47,100,020) (6,047,491) $ (67,130,330)
========== ============ =========== =============
CLASS B
Shares sold 593,153 $ 6,415,595 1,552,352 $ 16,119,854
Less shares repurchased (2,778,534) (30,029,382) (5,901,859) (61,066,388)
---------- ------------ ----------- -------------
Net decrease (2,185,381) $(23,613,787) (4,349,507) $ (44,946,534)
========== ============ =========== =============
CLASS C
Shares sold 392,575 $ 4,297,633 1,128,809 $ 11,943,232
Less shares repurchased (1,008,233) (11,018,302) (1,980,489) (20,575,126)
---------- ------------ ----------- -------------
Net decrease (615,658) $ (6,720,669) (851,680) $ (8,631,894)
========== ============ =========== =============
INVESTOR CLASS
Shares sold - $ - - $ -
Shares issued in
reorganization - - 557,894 6,560,837
Less shares repurchased (448,202) (5,293,397) (1,006) (12,164)
---------- ------------ ----------- -------------
Net increase (decrease) (448,202) $ (5,293,397) 556,888 $ 6,548,673
========== ============ =========== =============
CLASS R (a)
Shares sold 3,647 $ 43,319 26,538 $ 290,979
Reinvestment of distributions - - 43 503
Less shares repurchased (2,113) (24,505) (2,547) (28,795)
---------- ------------ ----------- -------------
Net increase 1,534 $ 18,814 24,034 $ 262,687
========== ============ =========== =============
CLASS Y
Shares sold 32,050 $ 396,591 60,540 $ 724,198
Reinvestment of distributions - - 124 1,534
Less shares repurchased (48,922) (603,350) (107,635) (1,280,744)
---------- ------------ ----------- -------------
Net decrease (16,872) $ (206,759) (46,971) $ (555,012)
========== ============ =========== =============
(a) Class R Shares were first publicly offered on April 1, 2003.
The accompanying notes are an integral part of these financial statements. 25
Pioneer Growth Shares
- --------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------------------
Six Months
Ended
6/30/05 Year Ended
(unaudited) 12/31/04
CLASS A
Net asset value, beginning of period $ 12.13 $ 11.42
-------- --------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.01) $ 0.04
Net realized and unrealized gain (loss) on investments (0.26) 0.68
-------- --------
Net increase (decrease) from investment operations $ (0.27) $ 0.72
Distributions to shareowners:
Net investment Income - (0.01)
Net realized gain - -
-------- --------
Net increase (decrease) in net asset value $ (0.27) $ 0.71
-------- --------
Net asset value, end of period $ 11.86 $ 12.13
======== ========
Total return* (2.23)% 6.29%
Ratio of net expenses to average net assets+ 1.39%** 1.37%
Ratio of net investment income (loss) to average net assets+ (0.18)%** 0.35%
Portfolio turnover rate 84%** 194%
Net assets, end of period (in thousands) $417,139 $475,096
Ratios with reductions for fees paid indirectly:
Net expenses 1.38%** 1.37%
Net investment income (loss) (0.17)%** 0.35%
Pioneer Growth Shares
- ----------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- ----------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
12/31/03 12/31/02(a) 12/31/01 12/31/00
CLASS A
Net asset value, beginning of period $ 9.05 $ 13.90 $ 17.21 $ 20.16
------- -------- -------- ---------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.04) $ (0.04) $ (0.04) $ (0.09)
Net realized and unrealized gain (loss) on investments 2.41 (4.81) (3.27) (1.81)
------- -------- -------- ---------
Net increase (decrease) from investment operations $ 2.37 $ (4.85) $ (3.31) $ (1.90)
Distributions to shareowners:
Net investment Income - - - -
Net realized gain - - - (1.05)
------- -------- -------- ---------
Net increase (decrease) in net asset value $ 2.37 $ (4.85) $ (3.31) $ (2.95)
------- -------- -------- ---------
Net asset value, end of period $ 11.42 $ 9.05 $ 13.90 $ 17.21
======= ======== ======== =========
Total return* 26.19% (34.89)% (19.23)% (9.57)%
Ratio of net expenses to average net assets+ 1.45% 1.39% 1.18% 1.22%
Ratio of net investment income (loss) to average net assets+ (0.42)% (0.39)% (0.29)% (0.60)%
Portfolio turnover rate 47% 88% 111% 58%
Net assets, end of period (in thousands) $516,234 $452,070 $836,149 $1,197,025
Ratios with reductions for fees paid indirectly:
Net expenses 1.45% 1.38% 1.16% 1.19%
Net investment income (loss) (0.42)% (0.38)% (0.27)% (0.57)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
Total return would be reduced if sales charges were taken into account.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
(a)The per share data presented above is based upon the average shares
outstanding for the period presented.
26 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- ----------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- ----------------------------------------------------------------------------------------
Six Months
Ended
6/30/05 Year Ended
(unaudited) 12/31/04
CLASS B
Net asset value, beginning of period $ 11.11 $ 10.54
-------- -------
Increase (decrease) from investment operations:
Net investment loss $ (0.06) $ (0.06)
Net realized and unrealized gain (loss) on investments (0.24) 0.63
-------- -------
Net increase (decrease) from investment operations $ (0.30) $ 0.57
Distributions to shareowners:
Net realized gain - -
-------- -------
Net increase (decrease) in net asset value $ (0.30) $ 0.57
-------- -------
Net asset value, end of period $ 10.81 $ 11.11
======== =======
Total return* (2.70)% 5.41%
Ratio of net expenses to average net assets+ 2.32%** 2.27%
Ratio of net investment loss to average net assets+ (1.11)%** (0.58)%
Portfolio turnover rate 84%** 194%
Net assets, end of period (in thousands) $148,195 $176,623
Ratios with reduction for fees paid indirectly:
Net expenses 2.31%** 2.27%
Net investment loss (1.10)%** (0.58)%
Pioneer Growth Shares
- ----------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- ----------------------------------------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
12/31/03 12/31/02 12/31/01 12/31/00
CLASS B
Net asset value, beginning of period $ 8.43 $ 13.07 $ 16.31 $ 19.31
------- -------- -------- --------
Increase (decrease) from investment operations:
Net investment loss $ (0.14) $ (0.27) $ (0.17) $ (0.35)
Net realized and unrealized gain (loss) on investments 2.25 (4.37) (3.07) (1.60)
------- -------- -------- --------
Net increase (decrease) from investment operations $ 2.11 $ (4.64) $ (3.24) $ (1.95)
Distributions to shareowners:
Net realized gain - - - (1.05)
------- -------- -------- --------
Net increase (decrease) in net asset value $ 2.11 $ (4.64) $ (3.24) $ (3.00)
------- -------- -------- --------
Net asset value, end of period $ 10.54 $ 8.43 $ 13.07 $ 16.31
======= ======== ======== ========
Total return* 25.03% (35.50)% (19.86)% (10.25)%
Ratio of net expenses to average net assets+ 2.44% 2.26% 1.98% 2.04%
Ratio of net investment loss to average net assets+ (1.41)% (1.27)% (1.09)% (1.42)%
Portfolio turnover rate 47% 88% 111% 58%
Net assets, end of period (in thousands) $213,481 $201,822 $400,506 $590,879
Ratios with reduction for fees paid indirectly:
Net expenses 2.43% 2.25% 1.97% 2.03%
Net investment loss (1.40)% (1.26)% (1.08)% (1.41)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales charges.
Total return would be reduced if sales charges were taken into account.
**Annualized.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 27
Pioneer Growth Shares
- --------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------------
Six Months
Ended
6/30/05 Year Ended
(unaudited) 12/31/04
CLASS C
Net asset value, beginning of period $ 11.23 $ 10.65
------- -------
Increase (decrease) from investment operations:
Net investment loss $ (0.06) $ (0.06)
Net realized and unrealized gain (loss) on investments (0.24) 0.64
------- -------
Net increase (decrease) from investment operations $ (0.30) $ 0.58
Distributions to shareowners:
Net realized gain - -
------- -------
Net increase (decrease) in net asset value $ (0.30) $ 0.58
------- -------
Net asset value, end of period $ 10.93 $ 11.23
======= =======
Total return* (2.67)% 5.45%
Ratio of net expenses to average net assets+ 2.20%** 2.17%
Ratio of net investment loss to average net assets+ (0.99)%** (0.46)%
Portfolio turnover rate 84%** 194%
Net assets, end of period (in thousands) $41,823 $49,881
Ratios with reduction for fees paid indirectly:
Net expenses 2.19%** 2.17%
Net investment loss (0.98%)** (0.46%)
Pioneer Growth Shares
- -------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
12/31/03 12/31/02 12/31/01 12/31/00
CLASS C
Net asset value, beginning of period $ 8.51 $ 13.18 $ 16.42 $ 19.45
------- ------- ------- --------
Increase (decrease) from investment operations:
Net investment loss $ (0.12) $ (0.23) $ (0.15) $ (0.45)
Net realized and unrealized gain (loss) on investments 2.26 (4.44) (3.09) (1.53)
------- ------- ------- --------
Net increase (decrease) from investment operations $ 2.14 $ (4.67) $ (3.24) $ (1.98)
Distributions to shareowners:
Net realized gain - - - (1.05)
------- ------- ------- --------
Net increase (decrease) in net asset value $ 2.14 $ (4.67) $ (3.24) $ (3.03)
------- ------- ------- --------
Net asset value, end of period $ 10.65 $ 8.51 $ 13.18 $ 16.42
======= ======= ======= ========
Total return* 25.15% (35.43)% (19.73)% (10.33)%
Ratio of net expenses to average net assets+ 2.32% 2.25% 1.87% 2.12%
Ratio of net investment loss to average net assets+ (1.29)% (1.26)% (0.98)% (1.51)%
Portfolio turnover rate 47% 88% 111% 58%
Net assets, end of period (in thousands) $56,358 $45,651 $83,129 $126,287
Ratios with reduction for fees paid indirectly:
Net expenses 2.31% 2.24% 1.85% 2.10%
Net investment loss (1.28%) (1.25%) (0.96%) (1.49%)
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales charges.
Total return would be reduced if sales charges were taken into account.
**Annualized.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 28
Pioneer Growth Shares
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended 12/11/04
6/30/05 to
(unaudited) 12/31/04
INVESTOR CLASS
Net asset value, beginning of period $12.14 $11.76
------ ------
Increase (decrease) from investment operations:
Net investment income $ 0.06 $ 0.01
Net realized and unrealized gain (loss)
on investments (0.30) 0.37
------ ------
Net increase (decrease) from investment operations $(0.24) $ 0.38
------ ------
Net increase (decrease) in net asset value $(0.24) $ 0.38
------ ------
Net asset value, end of period $11.90 $12.14
====== ======
Total return* (3.91)% 3.23%(a)
Ratio of net expenses to average net assets+ 0.89%** 0.85%**
Ratio of net investment income to average net
assets+ 0.30%** 0.93%**
Portfolio turnover rate 84%** 194%
Net assets, end of period (in thousands) $1,293 $6,766
Ratios with no waiver of management fees and
assumption of expenses by PIM and no reduction
for fees paid indirectly:
Net expenses 0.89%** 0.85%**
Net investment income 0.30%** 0.91%**
Ratios with waiver of management fees and
assumption of expenses by
PIM and reduction for fees paid indirectly:
Net expenses 0.88%** 0.85%**
Net investment income 0.31%** 0.93%**
(a) Return is not annualized.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at each end of each period.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 29
Pioneer Growth Shares
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Six Months
Ended
6/30/05 Year Ended 4/1/03(a)
(unaudited) 12/31/04 to 12/31/03
CLASS R
Net asset value, beginning of period $12.12 $11.45 $ 9.26
------ ------ ------
Increase (decrease) from investment operations:
Net investment income (loss) $(0.02) $ 0.07 $ 0.00(b)
Net realized and unrealized gain (loss)
on investments (0.26) 0.65 2.19
------ ------ ------
Net increase (decrease) from investment
operations $(0.28) $ 0.72 $ 2.19
Distributions to shareowners:
Net investment Income - (0.05) -
------ ------ ------
Net increase (decrease) in net asset value $(0.28) $ 0.67 $ 2.19
------ ------ ------
Net asset value, end of period $11.84 $12.12 $11.45
====== ====== ======
Total return* (2.31)% 6.26% 23.65%
Ratio of net expenses to average net assets+ 1.56%** 1.37% 1.18%**
Ratio of net investment income (loss) to average
net assets+ (0.35)%** 1.01% (0.11)%**
Portfolio turnover rate 84%** 194% 47%
Net assets, end of period (in thousands) $ 306 $ 295 $ 4
Ratios with reduction for fees paid indirectly:
Net expenses 1.56%** 1.37% 1.18%**
Net investment income (loss) (0.35)%** 1.01% (0.11)%**
(a) Class R shares were first publicly offered on April 1,2003.
(b) Amount rounds to less than $0.01 cent per share.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at each end of each period.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
30 The accompanying notes are an integral part of these financial statements.
Pioneer Growth Shares
- -----------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------------
Six Months
Ended
6/30/05 Year Ended
(unaudited) 12/31/04
CLASS Y
Net asset value, beginning of period $12.70 $11.95
------ ------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.03 $ 0.13
Net realized and unrealized gain (loss) on investments (0.27) 0.71
------ ------
Net increase (decrease) from investment operations $(0.24) $ 0.84
Distributions to shareowners:
Net investment income - (0.09)
Net realized gain - -
------ ------
Net increase (decrease) in net asset value $(0.24) $ 0.75
------ ------
Net asset value, end of period $12.46 $12.70
====== ======
Total return* (1.89)% 7.08%
Ratio of net expenses to average net assets+ 0.70%** 0.67%
Ratio of net investment income (loss) to average net
assets+ 0.51%** 1.02%
Portfolio turnover rate 84%** 194%
Net assets, end of period (in thousands) $2,583 $2,849
Ratios with reduction for fees paid indirectly:
Net expenses 0.70%** 0.66%
Net investment income (loss) 0.51%** 1.02%
Pioneer Growth Shares
- -------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------------------------------------
Year Ended Year Ended Year Ended Year Ended
12/31/03 12/31/02 12/31/01 12/31/00
CLASS Y
Net asset value, beginning of period $ 9.39 $ 14.34 $ 17.65 $20.37
------ ------- ------- ------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.03 $ 0.03 $ 0.04 $(0.02)
Net realized and unrealized gain (loss) on investments 2.53 (4.98) (3.35) (1.65)
------ ------- ------- ------
Net increase (decrease) from investment operations $ 2.56 $ (4.95) $ (3.31) $(1.67)
Distributions to shareowners:
Net investment income - - - -
Net realized gain - - - (1.05)
------ ------- ------- ------
Net increase (decrease) in net asset value $ 2.56 $ (4.95) $ (3.31) $(2.72)
------ ------- ------- ------
Net asset value, end of period $11.95 $ 9.39 $ 14.34 $17.65
====== ======= ======= ======
Total return* 27.26% (34.52)% (18.75)% (8.34)%
Ratio of net expenses to average net assets+ 0.71% 0.74% 0.61% 0.66%
Ratio of net investment income (loss) to average net
assets+ 0.32% 0.24% 0.33% (0.04)%
Portfolio turnover rate 47% 88% 111% 58%
Net assets, end of period (in thousands) $3,242 $ 3,231 $10,755 $5,908
Ratios with reduction for fees paid indirectly:
Net expenses 0.71% 0.73% 0.58% 0.65%
Net investment income (loss) 0.32% 0.25% 0.36% (0.03)%
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at each end of each period.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements 31
Pioneer Growth Shares
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/05 (unaudited)
- --------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer Growth Shares (the Fund) is a Delaware statutory trust registered under
the Investment Company Act of 1940 as a diversified, open-end management
investment company. The investment objective of the Fund is to seek
appreciation of capital.
The Trustees have authorized the issuance of six classes of shares of the Fund.
The Fund offers six classes of shares designated as Class A, Class B, Class C,
Investor Class, Class R and Class Y shares. Class R shares were first publicly
offered on April 1, 2003. Investor Class shares were first issued on December
10, 2004. The Fund is not offering additional Investor Class shares except in
connection with the reinvestment of dividends on the Fund's outstanding
Investor Class shares. Each class of shares represents an interest in the same
portfolio of investments of the Fund and has equal rights to voting,
redemptions, dividends and liquidation, except that each class of shares can
bear different transfer agent and distribution fees and has exclusive voting
rights with respect to the distribution plans that have been adopted by Class
A, Class B, Class C and Class R shareowners, respectively. There is no
distribution plan for Class Y and Investor Class shares.
The Fund's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gains and losses on investments during the
reporting year. Actual results could differ from those estimates. The following
is a summary of significant accounting policies followed by the Fund in the
preparation of its financial statements, which are consistent with those
policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. The net asset value
of the Fund is computed once daily, on each day the New York Stock
Exchange (NYSE) is open, as of the close of regular trading on the NYSE.
In computing the net asset value, securities are valued at the last sale
price on the principal exchange where they are traded. Securities that
have not traded on the date of valuation, or securities for which sale
prices are not generally reported, are
32
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
valued at the mean between the last bid and asked prices. Securities for
which market quotations are not readily available are valued at their fair
values as determined by, or under the direction of, the Board of Trustees.
Trading in foreign securities is substantially completed each day at
various times prior to the close of the NYSE. The values of such
securities used in computing the net asset value of the Fund's shares are
determined as of such times. The Fund also may use the fair value of a
security, including a non-U.S. security, when the closing market price on
the principal exchange where the security is traded no longer reflects the
value of the security. At June 30, 2005 there were no securities fair
valued. Temporary cash investments are valued at amortized cost.
Dividend income is recorded on the ex-dividend date except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Fund becomes aware of the ex-dividend
data in exercise of reasonable diligence. Interest income is recorded on
the accrual basis. Dividend and interest income are reported net of
unrecoverable foreign taxes withheld at the applicable country rates.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Futures Contracts
The Fund may enter into futures transactions to hedge against changes in
interest rates, securities prices, and currency rates or to seek to
increase total return. Upon entering into a futures contract, the Fund is
required to deposit with a broker an amount of cash or securities equal to
the minimum "initial margin" requirements of the associated futures
exchange. Subsequent payments on futures contracts ("variation margin")
are paid or received by the Fund, depending on the daily fluctuation in
the value of the contracts, and are recorded by the Fund as unrealized
gains or losses. When the contract is closed, the Fund realizes a gain or
loss equal to the difference between the opening and closing value of the
contract. The use of futures contracts involves, to varying degrees,
elements of market risk which may exceed the amounts recognized by the
Fund. Changes in value of the contracts may not directly correlate to the
changes in value of the underlying securities. These risks may decrease
the effectiveness of the Fund's hedging
33
Pioneer Growth Shares
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
strategies and potentially result in a loss. At June 30, 2005 there were
no open futures contracts.
C. Federal Income Taxes
It is the Fund's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Fund's distributions may
be shown in the accompanying financial statements as either from or in
excess of net investment income or net realized gain on investment
transactions, or from paid-in capital, depending on the type of book/tax
differences that may exist.
The tax character of current year distributions paid will be determined at
the end of the current fiscal year. The tax character of distributions
paid during the year ended December 31, 2004 was as follows:
- -------------------------------------------------
2004
- -------------------------------------------------
Distributions paid from:
Ordinary income $352,043
Long-term capital gain -
--------
Total $352,043
--------
- -------------------------------------------------
The following shows the components of accumulated losses on a
federal income tax basis at December 31, 2004.
- -------------------------------------------------
2004
- -------------------------------------------------
Undistributed ordinary income $ 72,875
Capital loss carryforward (555,071,293)
Post October loss deferred (8,291,896)
Unrealized appreciation 40,453,674
-------------
Total $(522,836,640)
-------------
- -------------------------------------------------
34
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The difference between book basis and tax basis unrealized appre
ciation is attributable to the tax deferral of losses on wash sales.
D. Fund Shares
The Fund records sales and repurchases of its shares as of trade date.
Pioneer Funds Distributor, Inc. (PFD), the principal underwriter for the
Fund and a wholly owned indirect subsidiary of UniCredito Italiano S.p.A
(UniCredito Italiano), earned $53,747 in underwriting commissions on the
sale of Class A shares for the six months ended June 30, 2005.
E. Class Allocations
Distribution fees are calculated based on the average daily net asset
value attributable to Class A, Class B, Class C and Class R shares of the
Fund, respectively (see Note 4). Class Y and Investor Class shares are not
subject to a distribution plan. Shareowners of each class share all
expenses and fees paid to the transfer agent, Pioneer Investment
Management Shareholder Services, Inc. (PIMSS), for its services, which are
allocated based on the number of accounts in each class and the ratable
allocation of related out-of-pocket expenses (see Note 3). Income, common
expenses and realized and unrealized gains and losses are calculated at
the Fund level and allocated daily to each class of shares based on their
respective percentage of adjusted net assets at the beginning of the day.
Distributions to shareowners are recorded as of the ex-dividend date.
Distributions paid by the Fund with respect to each class of shares are
calculated in the same manner, at the same time, and in the same amount,
except that Class A, Class B, Class C, Investor Class, Class R and Class Y
shares can bear different transfer agent and distribution fees.
F. Securities Lending
The Fund lends securities in the portfolio to certain broker-dealers or
other institutional investors, with the Fund's custodian acting as the
lending agent. When entering into a loan, the Fund receives collateral,
which is maintained by the custodian and earns income in the form of
negotiated lenders' fees. The Fund also continues to receive interest or
payments in lieu of dividends on the securities loaned. Gain or loss on
the fair value of the loaned securities that may occur during the term of
the loan will be for account of the
35
Pioneer Growth Shares
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Fund. The loans are secured by collateral of at least 102%, at all times,
of the fair value of the securities loaned. The amount of the collateral
will be adjusted daily to reflect any price fluctuation in the value of
the loaned securities. The Fund has the right under the lending agreements
to recover the securities from the borrower on demand. The Fund invests
cash collateral in the Securities Lending Investment Fund, which is
managed by Brown Brothers Harriman & Co., the Fund's custodian.
G. Repurchase Agreements
With respect to repurchase agreements entered into by the Fund, the value
of the underlying securities (collateral), including accrued interest
received from counterparties, is required to be at least equal to or in
excess of the value of the repurchase agreement at the time of purchase.
The collateral for all repurchase agreements is held in safekeeping in the
customer-only account of the Fund's custodian, or subcustodians. The
Fund's investment adviser, Pioneer Investment Management, Inc. (PIM), is
responsible for determining that the value of the collateral remains at
least equal to the repurchase price.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredito Italiano, manages the
Fund's portfolio. PIM receives a basic fee that is calculated daily at the
annual rate of 0.70% of the Fund's average daily net assets up to $500 million;
0.65% of the next $500 million; and 0.625% of the excess over $1 billion. The
basic fee is subject to a performance adjustment up to a maximum of +/-0.10%
based on the Fund's investment performance as compared with the Russell 1000
Growth Index over a rolling 36-month period. In addition, the fee is further
limited to a maximum annualized rate adjustment of +/-0.10% (a "ceiling" and a
"floor"). Effective August 1, 2004, PIM commenced a voluntary waiver of the
minimum fee provision (the "floor"), but may reimpose it in the future.
Pursuant to a shareowner vote on April 17, 2003, the benchmark index was
changed from the Russell 1000 Index effective May 1, 2003; however, the Russell
1000 Index will be used for monthly periods prior to May 1, 2003 until it is
eventually phased out. For the six months ended June 30, 2005, the aggregate
performance adjustment resulted in a decrease to the basic fee of $256,428 and
the management fee was equivalent to 0.61% of the average daily net assets.
36
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Through December 10, 2006, PIM has agreed not to impose all or a portion of its
management fee and to assume other operating expenses (excluding taxes,
commissions, interest and extraordinary expenses) of the Fund to the extent
necessary to limit Investor Class expenses to 1.15% of the average daily net
assets attributable to Investor Class shares.
In addition, under the management and administrative agreements, certain other
services and costs, including accounting, regulatory reporting, and insurance
premiums, are paid by the Fund. At June 30, 2005, $28,404 was payable to PIM
related to management fees, administrative costs and certain other services and
is included in due to affiliates.
3. Transfer Agent
PIMSS, a wholly owned indirect subsidiary of UniCredito Italiano, provides
substantially all transfer agent and shareowner services to the Fund at
negotiated rates. Included in due to affiliates is $527,076 in transfer agent
fees payable to PIMSS at June 30, 2005.
4. Distribution and Service Plans
The Fund adopted a Plan of Distribution for each class of shares (Class A Plan,
Class B Plan, Class C Plan, and Class R Plan) in accordance with Rule 12b-1 of
the Investment Company Act of 1940. Pursuant to the Class A Plan, the Fund pays
PFD a service fee of up to 0.25% of the average daily net assets attributable
to Class A shares in reimbursement of its actual expenditures to finance
activities primarily intended to result in the sale of Class A shares. Pursuant
to the Class B Plan and the Class C Plan, the Fund pays PFD 1.00% of the
average daily net assets attributable to each class of shares. The fee consists
of a 0.25% service fee and a 0.75% distribution fee paid as compensation for
personal services and/or account maintenance services or distribution services
with regard to Class B and Class C shares. Pursuant to the Class R Plan, the
Fund pays PFD 0.50% of the average daily net assets attributable to Class R
shares for distribution services. Included in due to affiliates is $8,003 in
distribution fees payable to PFD at June 30, 2005. The Fund also has adopted a
separate service plan for Class R shares (Service Plan). The Service Plan
authorizes the Fund to pay securities dealers, plan administrators or other
services organizations that agree to provide certain services to retirement
plans or plan participants holding shares of the
37
Pioneer Growth Shares
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 6/30/05 (unaudited) (continued)
- --------------------------------------------------------------------------------
Fund a service fee of up to 0.25% of the Fund's average daily net assets
attributable to Class R shares held by such plans.
In addition, redemptions of each class of shares (except Class Y and Investor
Class shares) may be subject to a contingent deferred sales charge (CDSC).
Effective February 1, 2004, a CDSC of 1.00% may be imposed on redemptions of
certain net asset value purchases of Class A shares within 18 months of
purchase (12 months for shares purchased prior to February 1, 2004). Effective
December 1, 2004, Class B shares that are redeemed within five years of
purchase are subject to a CDSC at declining rates beginning at 4.00%, based on
the lower of cost or market value of shares being redeemed. Shares purchased
prior to December 1, 2004 remain subject to the CDSC in effect at the time
those shares were purchased. Redemptions of Class C shares within one year of
purchase are subject to a CDSC of 1.00%. Redemptions of Class R shares within
18 months of purchase were subject to a CDSC of 1.00%. Effective July 1, 2004,
the CDSC on Class R shares was eliminated. Proceeds from the CDSCs are paid to
PFD. For the six months ended June 30, 2005, CDSCs in the amount of $126,700
were paid to PFD.
5. Expense Offset Arrangements
The Fund has entered into certain expense offset arrangements with PIMSS
resulting in a reduction in the Fund's total expenses due to interest earned on
cash held by PIMSS. For the six months ended June 30, 2005, the Fund's expenses
were reduced by $30,655 under such arrangements.
6. Line Of Credit Facility
The Fund, along with certain others in the Pioneer Family of Funds (the Funds),
collectively participate in a $50 million committed, unsecured revolving line
of credit facility. Borrowings are used solely for temporary or emergency
purposes. The Fund may borrow up to the lesser of $50 million or the limits set
by its prospectus for borrowings. Interest on collective borrowings is payable
at the Federal Funds Rate plus 1/2% on an annualized basis. The Funds pay an
annual commitment fee for this facility. The commitment fee is allocated among
such Funds based on their respective borrowing limits. For the six months ended
June 30, 2005, the Fund had no borrowings under this agreement.
38
Pioneer Growth Shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
7. Merger Information
On December 8, 2004, beneficial owners of Safeco Large-Cap Growth Fund (one of
the Series that comprised the Safeco Common Stock Trust) approved a proposed
Agreement and Plan of Reorganization that provided for the merger listed below.
This tax-free reorganization was accomplished on December 10, 2004, by
exchanging all of Safeco's net assets for the Fund's Investor Class shares,
based on Class A shares' ending net asset value. The following charts show the
details of the reorganizations as of that closing date ("Closing Date"):
- --------------------------------------------------------------------------------
Safeco Pioneer
Pioneer Large-Cap Growth Shares
Growth Shares Growth Fund (Post-
(Pre-Reorganization) (Pre-Reorganization) Reorganization)
- -------------------------------------------------------------------------------------------
Net Assets $696,269,073 $6,560,837 $702,829,910
Shares Outstanding 60,757,867 679,972 61,315,761
Investor Shares Issued - - 557,894
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Unrealized Appreciation Accumulated
on Closing Date Loss
- -------------------------------------------------------------------------------------------
Safeco Large-Cap Growth Fund $697,836 $(610,297)
- --------------------------------------------------------------------------------
39
Pioneer Growth Shares
- --------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT
- --------------------------------------------------------------------------------
The Investment Company Act of 1940 requires that both the Board of Trustees and
a majority of the Independent Trustees (collectively "the Trustees") vote
separately annually to approve the Fund's management contract (the "Management
Contract"). The Trustees have determined that the terms of the Management
Contract are fair and reasonable and that renewal of the contract will enable
the Fund to receive quality investment advisory services at a cost deemed
reasonable and in the best interests of the Fund and its shareholders. In
making such determinations, the Independent Trustees relied upon the assistance
of counsel to the Independent Trustees and counsel to the Fund.
Throughout the year, the Independent Trustees regularly met in executive
session separately from the Interested Trustees of the Fund and any officer of
Pioneer Investment Management, Inc., the Fund's adviser (the "Investment
Adviser"), or its affiliates. While the Trustees, including the Independent
Trustees, act on all major matters relating to the Fund, a significant portion
of the activities of the Board of Trustees (including certain of those
described herein) is conducted through committees, the members of which are
comprised exclusively of Independent Trustees. Such committee meetings are
attended by officers of the Fund or the Investment Adviser to the extent
requested by the members of the committee.
In evaluating the Management Contract, the Trustees conducted a review that was
specifically focused upon the renewal of the Management Contract, and relied
upon their knowledge, resulting from their meetings throughout the year, of the
Investment Adviser, its services and the Fund. Both in meetings specifically
dedicated to renewal of the Management Contract and at other meetings during
the course of the year, the Trustees, including the Independent Trustees,
received materials relating to the Investment Adviser's investment and
management services under the Management Contract. These materials included (i)
information on the investment performance of the Fund, a peer group of funds
and an index, in each case selected by the Independent Trustees for this
purpose, (ii) sales and redemption data in respect to the Fund, (iii) the
general investment outlook in the markets in which the Fund invests, (iv)
arrangements in respect of the distribution of the Fund's shares, (v) the
procedures employed to determine the value of each of the Fund's assets, (vi)
the Investment Adviser's management of the relationships with the Fund's
unaffiliated service providers, (vii) the record of compliance with the
40
Pioneer Growth Shares
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Fund's investment policies and restrictions and with the Fund's Code of Ethics
and the structure and responsibilities of the Investment Adviser's compliance
department, (viii) the nature, cost and character of non-investment management
services provided by the Investment Adviser and its affiliates and (ix) the
disclosures included in the Fund's prospectuses and reports to shareholders.
Specifically in connection with the Independent Trustees' review of the
Management Contract, the Independent Trustees requested and the Investment
Adviser provided additional information in order to evaluate the quality of the
Investment Adviser's services and the reasonableness of the fee under the
Management Contract. Among other items, this information included data or
analyses of (1) investment performance for one and three years and life of the
Fund periods for the Fund and a peer group selected by the Independent Trustees
for this purpose, (2) management fees incurred by a peer group of funds
selected by the Independent Trustees for this purpose, (3) the advisory fees of
comparable portfolios of other clients of the Investment Adviser, (4) expense
ratios for the Fund and a peer group of funds selected by the Independent
Trustees for this purpose, (5) the overall organization of the Investment
Adviser, (6) the Investment Adviser's financial results and condition,
including its and certain of its affiliates profitability from services
performed for the Fund, (7) transfer agency fees and administrative
reimbursements paid to the Investment Adviser or affiliates, (8) investment
management staffing, and (9) operating expenses paid to third parties. The
Trustees also reviewed information regarding the potential for the Fund and the
Investment Adviser to benefit from further economies of scale in the management
of the Fund in light of breakpoints in the Fund's management fee, reasonable
growth expectations for the Fund and certain of the Fund's expenses that are
not incurred as fees based on a percentage of net assets.
The following summarizes matters considered by the Trustees in connection with
their renewal of the Fund's Management Contract. The Trustees did not identify
any single factor as all-important or controlling, and the summary does not
detail all the matters that were considered.
A. Ancillary Benefits to Shareholders. The Trustees considered the benefits to
shareholders of investing in a Fund that is part of a large number of
investment companies offering a variety of
41
Pioneer Growth Shares
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FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
- --------------------------------------------------------------------------------
investment disciplines and providing for a large variety of Fund and
shareholder services.
B. Compliance and Investment Performance. The Trustees determined that the
Investment Adviser had policies and systems reasonably designed to achieve
compliance with the Fund's investment objectives and regulatory
requirements. The Trustees also reviewed the Fund's investment performance
based upon total return, as well as the Fund's performance compared to
both the performance of a peer group and an index, in each case selected
by the Independent Trustees for this purpose. The Fund's performance based
upon total return was in the fifth quintile of the peer group for the 12
months ended June 30, 2004, the fifth quintile of the peer group for the
three years ended June 30, 2004, and the fifth quintile for the five years
ended June 30, 2004. (In all quintile rankings referred to throughout this
discussion first quintile is most favorable to the Fund's shareholders.
Thus, highest relative performance would be first quintile and lowest
relative expenses also would be first quintile.) The Trustees noted that
recently the Investment Adviser had changed the portfolio manager for the
Fund. The Trustees concluded that the actions of the Investment Adviser in
appointing a new portfolio manager with the objective of enhancing
performance supported the continuation of the Management Contract.
C. The Investment Adviser's Personnel and Methods. The Trustees reviewed the
background of members of the team responsible for the daily management of
the Fund and the Fund's investment objective and discipline. The
Independent Trustees also have had discussions with senior management of
the Investment Adviser responsible for investment operations and the
senior management of the Investment Adviser's equities group. Among other
things, the Trustees considered the number, education and experience of
the Investment Adviser's investment staff and their use of technology and
emphasis on analytics in view of the risk profile of securities in which
the Fund invests. The Trustees concluded that the Investment Adviser had
the quality and depth of personnel and the well-developed methods
essential to performing its duties under the Management Contract.
D. Nature and Quality of Other Services. The Trustees considered the nature,
quality, cost and extent of other services provided to
42
Pioneer Growth Shares
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shareholders of the Fund, including administrative and shareholder
services performed by the Investment Adviser under the Management
Contract. The Trustees also considered the reasonableness of the
arrangements for reimbursement of the Investment Adviser's out-of-pocket
costs and expenses, including overhead, for certain administrative
services that the Investment Adviser is not required to provide under the
Management Contract. The Trustees also considered the nature and extent of
the other services provided by the Investment Adviser's affiliates under
other contracts and its supervision of third party service providers.
Based on these considerations, the Trustees concluded that the nature,
quality, cost and extent of such services are satisfactory and reliable
and serve the shareholders of the Fund well.
E. Management Fee and Expenses. The Trustees considered the Investment
Adviser's fee under the Management Contract relative to the management
fees charged by a peer group of funds selected by the Independent Trustees
for this purpose using data provided by an independent third party. The
Fund's management fee for the 12 months ended June 30, 2004 was in the
second quintile relative to the management fees paid by the other funds in
that peer group for the comparable period. The Trustees also considered
that the Fund's performance fee structure aligns the interests of
shareholders and the Investment Adviser. The Trustees noted that the
Investment Adviser was waiving the floor on the management fee but did not
take that into consideration in evaluating the contract. The Trustees
determined that the fee under the Management Contract was reasonable and
fair in light of both the overall nature and quality of services provided
by the Investment Adviser and the fees charged by the funds in the peer
group. The Trustees also considered the Fund's expense ratio and expense
ratios of a peer group of funds selected by the Independent Trustees for
this purpose. The Fund's expense ratio for the 12 months ended June 30,
2004 was in the third quintile of the applicable peer group for the most
recent fiscal year of the peer group for the comparable period. The
Trustees concluded that the Fund's overall expense ratio was reasonable
compared to that of comparable funds.
F. Profitability. The Trustees considered the level of the Investment Adviser's
profits with respect to the management of the Pioneer Funds, including
details with respect to the Fund. This consideration included a review of
the Investment Adviser's methodology
43
Pioneer Growth Shares
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FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
- --------------------------------------------------------------------------------
in allocating certain of its costs to the management of each Fund. The
Trustees also considered the financial results realized by the Investment
Adviser in connection with the operation of the Fund. They further
considered the profits realized by the Investment Adviser and its
affiliates from non-fund businesses that may benefit from or be related to
the Fund's business. The Trustees considered the Investment Adviser's
profit margins in comparison with the limited available industry data. The
Trustees concluded that the Investment Adviser's profits from management
of the Pioneer Funds, including the financial results derived from the
Fund, bear a reasonable relationship to the services rendered and are fair
for the management of the Fund.
G. Economies of Scale. The Trustees considered the economies of scale with
respect to the management of the Fund, whether the Fund had appropriately
benefited from any economies of scale, and whether there was potential for
realization of any further economies of scale. Because of break points in
the management fees, the Trustees concluded that any perceived or
potential economies of scale would be shared in a reasonable manner as the
Fund grows in size between Fund's shareholders and the Investment Adviser.
H. Other Benefits to the Investment Adviser. The Trustees also considered the
character and amount of fees paid by the Fund, other than under the
Management Contract, for services provided by the Investment Adviser and
affiliates, including fees for services such as shareholder services. The
Trustees also considered the receipt of sales loads and payments under
Rule 12b-1 plans in respect to the Pioneer Funds (including the Fund), and
benefits to the Investment Adviser from the use of "soft" commission
dollars to pay for research and brokerage services. The Trustees further
considered the revenues and profitability of the Investment Adviser's
businesses other than the fund business, including the Investment
Adviser's institutional investment advisory business. The Trustees
considered the intangible benefits that accrue to the Investment Adviser
and its affiliates by virtue of its relationship with the Fund and the
Pioneer Funds as a group. The Trustees concluded that all these types of
benefits accruing to the Investment Adviser were reasonable in the context
of the overall relationship between the Investment Adviser and the Fund.
44
Pioneer Growth Shares
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Conclusion. The Trustees, in light of the Investment Adviser's overall
performance, considered it appropriate to continue to retain the management
services of the Investment Adviser. Based on their evaluation of all material
factors deemed relevant and the advice of independent counsel, the Trustees
concluded that the Management Contract with the Fund is fair and reasonable and
voted to approve the continuation of the Management Contract for another year.
45
Pioneer Growth Shares
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TRUSTEES, OFFICERS AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
Trustees Officers
John F. Cogan, Jr., Chairman John F. Cogan, Jr., President
David R. Bock Osbert M. Hood, Executive
Mary K. Bush Vice President
Margaret B.W. Graham Vincent Nave, Treasurer
Osbert M. Hood Dorothy E. Bourassa, Secretary
Marguerite A. Piret
Stephen K. West
John Winthrop
Investment Adviser and Administrator
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Principal Underwriter
Pioneer Funds Distributor, Inc.
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Shareowner Services and Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Proxy Voting Policies and Procedures of the Fund are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Fund voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30, 2004 is publicly available to
shareowners at www.pioneerfunds.com. This information is also available on our
web site at www.pioneerfunds.com and on the Securities and Exchange
Commission's web site at http://www.sec.gov.
46
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THE PIONEER FAMILY OF MUTUAL FUNDS
- --------------------------------------------------------------------------------
Please consider a fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
U.S. Equity
Pioneer Fund
Pioneer Balanced Fund
Pioneer Cullen Value Fund
Pioneer Equity Income Fund
Pioneer Equity Opportunity Fund
Pioneer Growth Opportunities Fund
Pioneer Growth Shares
Pioneer Mid Cap Growth Fund
Pioneer Mid Cap Value Fund
Pioneer Oak Ridge Large Cap
Growth Fund
Pioneer Oak Ridge Small Cap
Growth Fund**
Pioneer AmPac Growth Fund(1)
Pioneer Small and Mid Cap
Growth Fund(2)
Pioneer Growth Leaders Fund(3)
Pioneer Strategic Growth Fund(4)
Pioneer Real Estate Shares
Pioneer Research Fund
Pioneer Small Cap Value Fund
Pioneer Small Company Fund
Pioneer Value Fund
Asset Allocation
Pioneer Ibbotson Aggressive
Allocation Fund
Pioneer Ibbotson Conservative
Allocation Fund
Pioneer Ibbotson Moderate
Allocation Fund
Pioneer Ibbotson Growth
Allocation Fund
International/Global Equity
Pioneer Emerging Markets Fund
Pioneer Europe Select Equity Fund
Pioneer International Equity Fund
Pioneer International Value Fund
Fixed Income
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer California Tax Free
Income Fund
Pioneer Global High Yield Fund
Pioneer High Yield Fund
Pioneer Municipal Bond Fund
Pioneer Short Term Income Fund
Pioneer Strategic Income Fund
Pioneer Tax Free Income Fund
Money Market
Pioneer Cash Reserves Fund*
Pioneer Tax Free Money Market Fund
(1) Formerly Pioneer Papp America-Pacific Rim Fund
(2) Formerly Pioneer Papp Small and Mid Cap Growth Fund
(3) Formerly Pioneer Papp Stock Fund
(4) Formerly Pioneer Papp Strategic Growth Fund
* An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks
to preserve the value of your investment at $1.00 per share, it is possible to
lose money by investing in the Fund.
** Effective May 26, 2005, Pioneer Oak Ridge Small Cap Growth Fund is generally
closed to new investors. Purchases in the Fund will be limited to existing
investors.
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RETIREMENT PLANS FROM PIONEER
- --------------------------------------------------------------------------------
Pioneer has a long history of helping people work toward their retirement
goals, offering plans suited to the individual investor and businesses of all
sizes. For more information on Pioneer retirement plans, contact your
investment professional, or call Pioneer at 1-800-622-0176.
Individual Retirement Accounts (IRAs)
Traditional IRA*
For anyone under age 70 1/2 earning income - individuals can contribute up to
$4,000 ($4,500 if age 50 or older). Contributions may be tax-deductible
depending upon income level and participation in an employer-sponsored plan.
Earnings are tax-deferred and must be included in income when received.
Withdrawals may be subject to a 10% penalty if taken before age 59 1/2.
Roth IRA*
No age limit. Individual's ability to contribute is determined by modified
Adjusted Gross Income (AGI) and filing status. Individuals filing single,
earning less than $110,000 and married filing jointly, earning less than
$160,000 are able to contribute.
Individuals can contribute up to $4,000 ($4,500 if age 50 or older).
Contributions are not tax-deductible, but actual amounts contributed may
generally be withdrawn at any time without tax or penalty. Earnings may be tax
and penalty free if certain conditions are met.**
Employer-Sponsored Plans
Uni-K Plan*
A 401(k) plan designed specifically for any business that employs only owners
and their spouses. Participants can make salary deferral contributions up to
$14,000 per year ($18,000 if age 50 or older). In addition, each year the
business may contribute up to 25% of pay for a maximum contribution amount of
$42,000 ($46,000 if age 50 or older).
Uni-DB Plan
A full service defined benefit plan for successful professional business owners
over age 45 with five or fewer employees. Annual employer contributions are
required. The plan allows for the maximum deductible contribution. No specific
contribution limits, but payments beginning at retirement age are limited to
100% of pay up to $170,000 and are determined by an actuary.
401(k) Plan*
Allows employees to make pre-tax contributions through payroll deduction, up to
$14,000 ($18,000 if age 50 or older) per year. Employers' contributions are
discretionary. The 401(k) offers companies maximum flexibility.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties. Employer sponsored plans withdrawals are restricted to certain
events, such as termination, death or disability.
48
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SIMPLE IRA Plan*
Designed for employers with 100 or fewer eligible employees. Employees can
defer up to $10,000 ($12,000 if age 50 or older). Employer makes additional
required contributions.
403(b) Plan*
Also known as a Tax-Sheltered Account (TSA), this plan lets employees of public
schools, non-profit hospitals and other tax-exempt organizations make pre-tax
contributions through payroll deduction. Individuals can generally defer up to
$14,000 per year ($18,000 if age 50 or older).
SEP-IRA
Lets self-employed people and small-business owners make tax-deductible
contributions of up to 25% of income, while maintaining complete contribution
flexibility each year.
Profit Sharing Plan
Companies can decide each year whether - and how much - to contribute to
participants, up to 25% of each participant's pay. Can include vesting
schedules that are not available with a SEP-IRA.
Age-Based Profit Sharing Plan
Employer contributions are flexible, but are based on a formula using age and
salary. Each year, a business can contribute up to 25% of the total eligible
payroll.
* Special Catch-Up Provisions are available to individuals age 50 and older to
contribute additional amounts to their retirement accounts. Refer to IRS
Publication 590 for additional information or call our Retirement Plans
Information line at 1-800-622-0176.
** Qualified distributions may be withdrawn after 5 years and one of the
following: attainment of age 59 1/2, disability or death.
Withdrawals of earnings or other taxable amounts are subject to income tax and,
if made prior to age 59 1/2, may be subject to an additional 10% federal tax
penalty.
Investing in mutual funds involves significant risks, for complete information
on the specific risks associated with each fund, please see the appropriate
fund's prospectus.
Please consider a fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
adviser, call 800-225-6292 or visit www.pioneerfunds.com.
Most retirement plan withdrawals must meet specific conditions to avoid
penalties. Employer sponsored plans withdrawals are restricted to certain
events, such as termination, death or disability.
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This page for your notes.
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This page for your notes.
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HOW TO CONTACT PIONEER
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We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
Call us for:
Account Information, including existing accounts,
new accounts, prospectuses, applications
and service forms 1-800-225-6292
FactFone(SM) for automated fund yields, prices,
account information and transactions 1-800-225-4321
Retirement plans information 1-800-622-0176
Telecommunications Device for the Deaf (TDD) 1-800-225-1997
Write to us:
PIMSS, Inc.
P.O. Box 55014
Boston, Massachusetts 02205-5014
Our toll-free fax 1-800-225-4240
Our internet e-mail address ask.pioneer@pioneerinvest.com
(for general questions about Pioneer only)
Visit our web site: www.pioneerfunds.com
Please consider the Fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about the Fund and should be read carefully before you invest. To obtain a
prospectus and for other information on any Pioneer fund, call 1-800-225-6292 or
visit our web site www.pioneerfunds.com.
The Fund files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form may also be viewed and copied at
the Commission's Public Reference Room in Washington, DC. Information regarding
the operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the 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. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its 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, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics 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, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its 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 and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its 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, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
- ---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
- ---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
- ---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
- ---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
- ----------------------- --------------------------- -----------------------------------------------
- ------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- -------------------------
- ------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
- ------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
- ----------------------- --------------------------- -----------------------------------------------
- --------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
- ------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
- ----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
- ----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
- ----------------------- ------------------------- -----------------------------------------------
- ------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
- ------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
- ------------------------------------------- ------------------------------
- --------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
- --------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. E&Y has informed
the Audit Committee that based on its internal reviews
and the de minimis nature of the services provided and
fees received, it does not believe its independence
with respect to the Fund has been impaired.
N/A
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
N/A
ITEMS 5-6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Not applicable to open-end management investment companies.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Growth Shares Fund
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date August 29, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date August 29, 2005
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date August 29, 2005
* Print the name and title of each signing officer under his or her signature.