UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-4984
AMERICAN BEACON FUNDS
(Exact name of registrant as specified in charter)
4151 Amon Carter Boulevard, MD 2450
Fort Worth, Texas 76155
(Address of principal executive offices)-(Zip code)
WILLIAM F. QUINN, PRESIDENT
4151 Amon Carter Boulevard, MD 2450
Fort Worth, Texas 76155
(Name and address of agent for service)
Registrant's telephone number, including area code: (817) 967-3509
Date of fiscal year end: October 31, 2009
Date of reporting period: April 30, 2009
ITEM 1. REPORTS TO STOCKHOLDERS.
GUIDANCE | VISION | EXPERIENCE
(AMERICAN BEACON FUNDS(SM) LOGO)
Semi-Annual Report
April 30, 2009
LARGE CAP VALUE FUND
(GRAPHIC)
About American Beacon Advisors
Since 1986, American Beacon Advisors has offered a variety of products and
investment advisory services to numerous institutional and retail clients,
including a variety of mutual funds, corporate cash management, and separate
account management.
Our clients include defined benefit plans, defined contribution plans,
foundations, endowments, corporations, financial planners, and other
institutional investors. With American Beacon Advisors, you can put the
experience of a multi-billion dollar asset management firm to work for your
company.
Contents
Message from American Beacon.................................... 1
Market and Performance Overview................................. 2
Schedule of Investments......................................... 6
Additional Information.......................................... Back Cover
Any opinions herein, including forecasts, reflect our judgment as of the end of
the reporting period and are subject to change. Each advisor's strategies and
the Fund's portfolio composition will change depending on economic and market
conditions. This report is not a complete analysis of market conditions and
therefore, should not be relied upon as investment advice. Although economic and
market information has been compiled from reliable sources, American Beacon
Advisors, Inc. makes no representation as to the completeness or accuracy of the
statements contained herein.
American Beacon Funds April 30, 2009
(PHOTO OF GENE L. NEEDLES, JR.)
FELLOW SHAREHOLDERS,
Please allow me to introduce myself. I am Gene Needles, Jr., the new
Executive Vice President for the American Beacon Funds. I have over 27 years of
financial services experience with some of the country's largest fund complexes,
and I will be primarily responsible for daily operations as well as distribution
of the American Beacon Funds. I am very excited to be a part of American Beacon
and look forward to building a lasting relationship with all of our
shareholders.
Enclosed is the American Beacon Large Cap Value Fund Semi-Annual Report for
the six months ended April 30, 2009.
During the six-month period covered by this report, the capital markets
experienced widespread volatility brought on by concern over the world-wide
credit crisis. The American Beacon Large Cap Value Fund - Institutional Class
reported a return of -8.46% for the six-month period ended April 30, 2009, while
the S&P 500 and Dow Jones Industrial Average Indices reported returns of -8.53%
and -10.79%, respectively, for this period.
In the past, long-term investors have been rewarded for their patience. We
continue to believe the Fund's fundamental investment strategy and lower than
average expense ratio will continue to serve the Fund well over time.
Please review the enclosed market overview, portfolio listings, and
detailed financial data. As always, we welcome the opportunity to serve your
financial needs. To obtain further details about the American Beacon Funds
family or to access your account information, please visit our website at
www.americanbeaconfunds.com. Thank you for your continued confidence in the
American Beacon Funds.
Sincerely,
/s/ Gene L. Needles, Jr.
----------------------------------------
Gene L. Needles, Jr.
Executive Vice President
American Beacon Funds
1
DOMESTIC EQUITY MARKET OVERVIEW
APRIL 30, 2009 (UNAUDITED)
A tale of two markets might be the most accurate description of the
six-month period ended April 30, 2009. The equity markets were down overall for
the six months, as represented by a decline of 8.5% for the S&P 500, but for the
first four months, the S&P 500 fell a breath-taking 23.2%. Through February,
bleak economic performance around the world set the background for equity market
declines. In addition to the well publicized economic distress in the U.S., the
period featured news of staggering declines in Japanese manufacturing and sharp
declines in Asian and Eastern European exports. The U.K. and Western Europe
continued to be weak, with the Bank of England purchasing U.K. government debt
in an aggressive move to quantitative easing as its benchmark interest rate came
close to zero. Latin America slowed down, with Mexico in a deep recession. China
was the global exception with domestic demand appearing to hold up and loan
creation remaining solid.
Starting in March, equities staged a dramatic recovery in the face of
continued poor economic data, providing support for the view that valuations
ultimately drive stock prices. The U.S. government's announcement of details on
initiatives to stabilize the banking and housing market appeared to spark the
rally. Although some economic data points began to show a hint of economic
stability (or at least a deceleration in the rate of decline) toward the end of
April, it is still too early to call an improvement in the economy. However, it
is apparent that because the market was trading at such deeply depressed,
pessimistic levels, the mere hint of a recovery was enough to cause a
significant rally. Thus for March and April, the S&P 500 was up 19.2%, unwinding
a large part of the earlier months' declines.
2
PERFORMANCE OVERVIEW
AMERICAN BEACON LARGE CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Large Cap Value Fund returned -8.46% for the
six months ended April 30, 2009, outperforming the Russell 1000(R) Value Index
("Index") return of -13.27%, but slightly lagging the Lipper Large-Cap Value
Funds Index return of -8.44%.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
--------- ------ ------- --------
Institutional Class(1,4) ...... -8.46% -38.28% -1.55% 0.69%
Investor Class(1,4) ........... -8.59% -38.44% -1.81% 0.43%
Advisor Class(1,2,4) .......... -8.68% -38.58% -2.00% 0.33%
AMR Class(1,4) ................ -8.34% -38.11% -1.30% 0.96%
Lipper Large-Cap
Value Funds Index (3) ......... -8.44% -35.93% -2.69% -1.50%
Russell 1000 Value Index (3) .. -13.27% -39.21% -2.50% -0.50%
* Not annualized
1. The Investor and Advisor Classes were formerly known as the PlanAhead and
Service Classes, respectively. Performance shown is historical and may not
be indicative of future returns. Investment returns and principal value
will vary, and shares may be worth more or less at redemption than at
original purchase. Performance shown is as of date indicated, and current
performance may be lower or higher than the performance data quoted. To
obtain performance as of the most recent month end, please visit
www.americanbeaconfunds.com or call 1-800-967-9009. Fund performance in the
table above does not reflect the deduction of taxes a shareholder would pay
on distributions or the redemption of shares.
2. Fund performance for the five-year and ten-year periods represents the
total returns achieved by the Investor Class from 4/30/99 up to 6/1/05, the
inception date of the Advisor Class, and the returns of the Advisor Class
since its inception. Expenses of the Advisor Class are higher than those of
the Investor Class. Therefore, total returns shown may be higher than they
would have been had the Advisor Class been in existence since 4/30/99. A
portion of the fees charged to the Advisor Class of the Fund was waived in
2005. Performance prior to waiving fees was lower than the actual returns
shown for 2005.
3. The Russell 1000 Value Index is an unmanaged index of those stocks in the
Russell 1000 Index with lower price-to-book ratios and lower forecasted
growth values. Russell 1000(R) Value Index and Russell 1000 Index are
registered trademarks of the Frank Russell Company. The Lipper Large-Cap
Value Funds Index tracks the results of the 30 largest mutual funds in the
Lipper Large-Cap Value Funds category. Lipper is an independent mutual fund
research and ranking service. One cannot directly invest in an index.
4. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, Advisor and AMR Class
shares was 0.59%, 0.97%, 1.09% and 0.33%, respectively. The expense ratios
above may vary from the expense ratios presented in other sections of this
report that are based on expenses incurred during the period covered by
this report.
The Fund outperformed the Index as both sector allocation and stock
selection added value relative to the Index. The Fund's four times overweighting
in Information Technology, the best performing sector in the Index, and a
significant underweighting in Financials, the worst performing sector in the
Index, added the most value relative to the Index. The positive impact from the
above mentioned sector exposures was somewhat offset by an overweight in
Industrials and an underweight in the Consumer Discretionary sector, which
detracted from relative performance.
From a stock selection standpoint, the Fund's holdings in the Industrials,
Health Care, and Consumer Discretionary sectors were responsible for a large
portion of the excess performance. Companies with the greatest positive impact
in the Industrials sector were Honeywell International (up 4.6%), Thomas & Betts
(up 5.3% for the period the Fund owned the security), and Northrop (up 5.2%). In
the Health Care sector, Wyeth (up 33.9%), Hospira (up 18.2%), and Schering
Plough (up 60.6%) added the most value relative to the Index. JC Penney (up
30.7%) and Gentex (up 42.5%) were major contributors in the Consumer
Discretionary sector. This excess performance relative to the Index was
partially offset by poor security selection in the Financials and Information
Technology sectors. Bank of America (down 62.2%), Citigroup (down 77.6%), and
Synovus Financial (down 68.4%) were the largest detractors in the Financials
sector. In the Information Technology sector, Hewlett Packard (down 5.5%) and
Intel (up 0.5%) hurt performance most.
The sub-advisors continue to invest in a broadly diversified portfolio of
companies that they believe have attractive valuations and above-average
earnings growth potential. This approach should allow the Fund to benefit over
the longer term.
3
PERFORMANCE OVERVIEW
AMERICAN BEACON LARGE CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
International Business Machines Corp. .. 3.3%
JPMorgan Chase & Co. ................... 2.8%
ConocoPhillips.......................... 2.7%
AT&T, Inc. ............................. 2.5%
Wyeth Corp. ............................ 2.0%
The Home Depot, Inc. ................... 1.8%
Verizon Communications, Inc. ........... 1.8%
Hewlett-Packard Co. .................... 1.6%
Dominion Resources, Inc. ............... 1.6%
Philip Morris International, Inc. ...... 1.5%
SECTOR ALLOCATION
% OF
EQUITIES
--------
Information Technology.................. 15.5%
Financials.............................. 15.4%
Industrials............................. 13.0%
Health Care............................. 12.7%
Consumer Staples........................ 11.6%
Consumer Discretionary.................. 9.3%
Energy.................................. 8.0%
Utilities............................... 6.3%
Telecommunication Services.............. 5.2%
Materials............................... 3.0%
4
FUND EXPENSES
AMERICAN BEACON LARGE CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs and (2) ongoing costs, including management fees, administrative service
fees, distribution (12b-1) fees, and other Fund expenses. The examples below are
intended to help you understand the ongoing cost (in dollars) of investing in
the Fund and to compare these costs with the ongoing costs of investing in other
mutual funds.
The examples are based on an investment of $1,000 invested at the beginning
of the period in each Class and held for the entire period from November 1, 2008
through April 30, 2009.
ACTUAL EXPENSES
The "Actual" lines of the table provide information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading "Expenses Paid During Period" to estimate
the expenses you paid on your account during this period. Shareholders of the
Investor and Institutional Classes that invest in the Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" lines of the table provide information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed 5% per year rate of return before expenses (not the
Fund's actual return). You may compare the ongoing costs of investing in the
Fund with other funds by contrasting this 5% hypothetical example and the 5%
hypothetical examples that appear in the shareholder reports of the other funds.
The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. Shareholders
of the Investor and Institutional Classes that invest in the Fund through an IRA
may be subject to a custodial IRA fee of $12 that is typically deducted each
December. If your account was subject to a custodial IRA fee during the period,
your costs would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by the
Fund. Similarly, the expense examples for other funds do not reflect any
transaction costs charged by those funds, such as sales charges (loads),
redemption fees or exchange fees. Therefore, the "Hypothetical" lines of the
table are useful in comparing ongoing costs only and will not help you determine
the relative total costs of owning different funds. If you were subject to any
transaction costs during the period, your costs would have been higher.
Beginning Ending
Account Account Expenses Paid
Value Value During Period*
11/1/08 4/30/09 11/1/08-4/30/09
--------- --------- ---------------
INSTITUTIONAL CLASS
Actual $1,000.00 $ 915.36 $2.85
Hypothetical $1,000.00 $1,021.82 $3.01
(5% return before expenses)
INVESTOR CLASS
Actual $1,000.00 $ 914.13 $4.08
Hypothetical $1,000.00 $1,020.53 $4.31
(5% return before expenses)
ADVISOR CLASS
Actual $1,000.00 $ 913.25 $5.22
Hypothetical $1,000.00 $1,019.34 $5.51
(5% return before expenses)
AMR CLASS
Actual $1,000.00 $ 916.63 $1.66
Hypothetical $1,000.00 $1,023.06 $1.76
(5% return before expenses)
* Expenses are equal to the Fund's annualized expense ratios for the
six-month period of 0.60%, 0.86%, 1.10% and 0.35% for the Institutional,
Investor, Advisor and AMR Classes respectively, multiplied by the average
account value over the period, multiplied by the number derived by dividing
the number of days in the most recent fiscal half-year (181) by days in the
year (365) to reflect the half year period.
5
AMERICAN BEACON LARGE CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
COMMON STOCKS - 94.52%
CONSUMER DISCRETIONARY - 8.79%
AUTO COMPONENTS - 0.59%
Gentex Corp. + ............................... 2,365,000 $ 31,620
-----------
HOTELS, RESTAURANTS & LEISURE - 1.34%
Carnival Corp. ............................... 1,941,200 52,180
Wyndham Worldwide Corp. ...................... 1,680,680 19,630
-----------
71,810
-----------
HOUSEHOLD DURABLES - 0.36%
Fortune Brands, Inc. ......................... 493,500 19,399
-----------
INTERNET & CATALOG RETAIL - 0.14%
eBay, Inc. ## ................................ 464,900 7,657
-----------
MEDIA - 1.89%
CBS Corp. .................................... 3,099,800 21,823
Interpublic Group of Cos., Inc. ## ........... 843,700 5,281
Time Warner, Inc. ............................ 1,500,000 32,745
Walt Disney Co. Ltd. ......................... 1,318,300 28,871
Warner Music Group Corp. ..................... 2,322,000 12,492
-----------
101,212
-----------
MULTILINE RETAIL - 1.58%
J.C. Penney Company, Inc. .................... 1,634,800 50,172
Target Corp. ................................. 768,700 31,717
Wal-Mart Stores, Inc. ........................ 63,700 3,210
-----------
85,099
-----------
SPECIALTY RETAIL - 2.00%
Gap, Inc. .................................... 416,100 6,466
The Home Depot, Inc. ......................... 3,732,467 98,239
Limited Brands, Inc. ......................... 214,900 2,454
-----------
107,159
-----------
TEXTILES & APPAREL - 0.89%
Polo Ralph Lauren Corp. + .................... 890,000 47,918
-----------
TOTAL CONSUMER DISCRETIONARY .................... 471,874
-----------
CONSUMER STAPLES - 11.02%
BEVERAGES - 2.11%
Coca-Cola Co. ................................ 429,300 18,481
Diageo plc, ADR .............................. 1,626,200 77,814
PepsiCo, Inc. ................................ 339,900 16,913
-----------
113,208
-----------
FOOD & DRUG RETAILING - 1.65%
Safeway, Inc. ................................ 2,330,400 46,025
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
Sysco Corp. .................................. 1,829,400 $ 42,680
-----------
88,705
-----------
FOOD PRODUCTS - 3.06%
ConAgra Foods, Inc. .......................... 2,600,000 46,020
H.J. Heinz Co. ............................... 497,100 17,110
Hershey Co. .................................. 1,025,550 37,063
Kellogg Co. .................................. 990,000 41,689
Kraft Foods, Inc. ............................ 703,013 16,451
Unilever plc, ADR + .......................... 311,900 6,070
-----------
164,403
-----------
HOUSEHOLD PRODUCTS - 0.33%
The Procter & Gamble Co. ..................... 355,800 17,591
-----------
PERSONAL PRODUCTS - 0.71%
L'Oreal SA + ................................. 2,675,000 37,878
-----------
TOBACCO - 3.16%
Altria Group, Inc. ........................... 1,312,900 21,440
Imperial Tobacco Group plc, ADR .............. 1,394,100 63,362
Lorillard, Inc. .............................. 71,100 4,488
Philip Morris International, Inc. ............ 2,212,400 80,089
-----------
169,379
-----------
TOTAL CONSUMER STAPLES .......................... 591,164
-----------
ENERGY - 7.55%
ENERGY EQUIPMENT & SERVICES - 0.71%
Weatherford International Ltd. ## ............ 2,300,000 38,249
-----------
OIL & GAS - 6.84%
Chevron Corp. ................................ 976,262 64,531
ConocoPhillips ............................... 3,562,296 146,054
Devon Energy Corp. ........................... 1,132,000 58,694
Duke Energy Corp. ............................ 2,260,900 31,223
Occidental Petroleum Corp. ................... 849,700 47,829
Royal Dutch Shell plc, ADR ................... 403,600 18,364
-----------
366,695
-----------
TOTAL ENERGY .................................... 404,944
-----------
FINANCIALS - 14.42%
BANKS - 7.66%
Bank of America Corp. ........................ 7,773,490 69,417
Bank of New York Mellon Corp. ................ 249,100 6,347
Citigroup, Inc. .............................. 1,971,238 6,012
Comerica, Inc. ............................... 139,000 2,916
East West Bancorp, Inc. ...................... 2,068,000 14,124
JP Morgan Chase & Co. ........................ 4,584,098 151,275
See accompanying notes
6
AMERICAN BEACON LARGE CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
KeyCorp ...................................... 781,874 $ 4,809
M&T Bank Corp. ............................... 174,560 9,156
PNC Financial Services Group, Inc. + ......... 797,949 31,679
SunTrust Banks, Inc. ......................... 123,400 1,782
Synovus Financial Corp. + .................... 4,516,000 14,587
U.S. Bancorp ................................. 1,457,660 26,559
Washington Mutual, Inc. ...................... 1,765,000 --
Wells Fargo & Co. ............................ 3,071,358 61,458
Zions Bancorporation ......................... 1,000,000 10,930
-----------
411,051
-----------
DIVERSIFIED FINANCIALS - 3.35%
American Express Co. ......................... 2,195,800 55,378
Capital One Financial Corp. .................. 1,207,400 20,212
Charles Schwab Corp. ......................... 1,247,620 23,056
Discover Financial Services .................. 152,550 1,240
Mitsubishi UFJ Financial Group, Inc., ADR .... 8,256,000 44,748
Morgan Stanley Dean Witter & Co. ............. 1,000,000 23,640
SLM Corp. ## ................................. 2,435,500 11,763
-----------
180,037
-----------
INSURANCE - 3.41%
ACE Ltd. ..................................... 1,066,800 49,414
Aflac, Inc. .................................. 779,000 22,505
Allstate Corp. ............................... 174,200 4,064
American International Group, Inc. + ......... 2,397,100 3,308
Conseco, Inc. ## ............................. 309,300 495
Genworth Financial, Inc. ..................... 508,000 1,199
Hartford Financial Services Group, Inc. + .... 694,450 7,965
MetLife, Inc. ................................ 1,149,059 34,185
Prudential Financial, Inc. ................... 109,500 3,162
Travelers Cos., Inc. ......................... 982,700 40,428
XL Capital Ltd. + ............................ 1,699,100 16,159
-----------
182,884
-----------
TOTAL FINANCIALS ................................ 773,972
-----------
HEALTH CARE - 12.02%
HEALTH CARE EQUIPMENT & SUPPLIES - 1.26%
Baxter International, Inc. ................... 1,305,600 63,321
Zimmer Holdings, Inc. ## ..................... 93,500 4,113
-----------
67,434
-----------
HEALTH CARE PROVIDERS & SERVICES - 2.69%
Cardinal Health, Inc. ........................ 1,317,900 44,532
CIGNA Corp. .................................. 1,599,500 31,526
UnitedHealth Group, Inc. ..................... 813,600 19,136
Universal Health Services, Inc. .............. 624,130 31,456
WellPoint, Inc. ## ........................... 419,100 17,921
-----------
144,571
-----------
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
PHARMACEUTICALS - 8.07%
Amgen, Inc. ## ............................... 392,700 $ 19,034
Bristol-Myers Squibb Co. ..................... 4,013,500 77,059
Eli Lilly & Co. .............................. 1,767,900 58,199
Hospira, Inc. ## ............................. 1,143,000 37,570
Johnson & Johnson ............................ 633,100 33,149
Merck & Co., Inc. ............................ 866,300 20,999
Pfizer, Inc. ................................. 4,806,700 64,218
Schering-Plough Corp. ........................ 650,200 14,968
Wyeth Corp. .................................. 2,540,600 107,722
-----------
432,918
-----------
TOTAL HEALTH CARE ............................... 644,923
-----------
INDUSTRIALS - 12.30%
AEROSPACE & DEFENSE - 3.81%
Boeing Co. ................................... 1,904,700 76,283
Northrop Grumman Corp. ....................... 1,124,900 54,389
Raytheon Co. ................................. 1,498,700 67,786
United Technologies Corp. .................... 124,000 6,056
-----------
204,514
-----------
AIR FREIGHT & COURIERS - 0.63%
FedEx Corp. .................................. 607,200 33,979
-----------
INDUSTRIAL CONGLOMERATES - 3.98%
3M Co. ....................................... 705,600 40,643
General Electric Co. ......................... 5,743,200 72,651
Honeywell International, Inc. ................ 2,484,525 77,542
Textron, Inc. + .............................. 1,029,600 11,048
Tyco International Ltd. ...................... 485,900 11,545
-----------
213,429
-----------
MACHINERY - 3.50%
Caterpillar, Inc. + .......................... 461,400 16,417
Cummins, Inc. ................................ 162,600 5,528
Deere & Co. .................................. 1,039,000 42,869
Eaton Corp. .................................. 437,500 19,162
Illinois Tool Works, Inc. .................... 1,727,900 56,675
ITT Industries, Inc. ......................... 930,300 38,152
PACCAR, Inc. + ............................... 252,700 8,956
-----------
187,759
-----------
TRANSPORTATION INFRASTRUCTURE - 0.38%
Burlington Northern Santa Fe Corp. ........... 302,800 20,433
-----------
TOTAL INDUSTRIALS ............................... 660,114
-----------
INFORMATION TECHNOLOGY - 14.66%
COMMUNICATIONS EQUIPMENT - 0.96%
Alcatel-Lucent, ADR ## ...................... 1,767,700 4,419
See accompanying notes
7
AMERICAN BEACON LARGE CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
Nokia Corp., ADR ............................. 3,322,500 $ 46,980
-----------
51,399
-----------
COMPUTERS & PERIPHERALS - 7.14%
Apple Computer, Inc. ## ...................... 550,000 69,206
Dell, Inc. ## ................................ 269,700 3,134
EMC Corp. ## ................................. 4,000,000 50,120
Hewlett-Packard Co. .......................... 2,372,700 85,370
International Business Machines Corp. ........ 1,696,500 175,096
-----------
382,926
-----------
ELECTRICAL EQUIPMENT - 0.59%
Molex, Inc. - Class A ........................ 1,688,000 25,810
Molex, Inc. .................................. 339,000 5,651
-----------
31,461
-----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.52%
Intel Corp. .................................. 4,397,400 69,391
Tyco Electronics Ltd. ........................ 701,400 12,232
-----------
81,623
-----------
SEMICONDUCTOR EQUIPMENT & PRODUCTS - 0.72%
Texas Instruments, Inc. ...................... 2,147,200 38,779
-----------
SOFTWARE - 3.73%
Adobe Systems, Inc. ## ....................... 1,500,000 41,025
CA, Inc. ..................................... 923,703 15,934
Microsoft Corp. .............................. 3,314,200 67,146
Oracle Corp. ................................. 3,943,300 76,263
-----------
200,368
-----------
TOTAL INFORMATION TECHNOLOGY .................... 786,556
-----------
MATERIALS - 2.86%
CHEMICALS - 2.74%
Air Products & Chemicals, Inc. ............... 1,051,400 69,287
Dow Chemical Co. ............................. 1,071,000 17,136
E. I. du Pont de Nemours & Co. ............... 1,094,900 30,548
Eastman Chemical Co. ......................... 32,900 1,305
PPG Industries, Inc. ......................... 647,600 28,527
-----------
146,803
-----------
METALS & MINING - 0.12%
Alcoa, Inc. .................................. 698,400 6,335
-----------
TOTAL MATERIALS ................................. 153,138
-----------
TELECOMMUNICATION SERVICES - 4.92%
DIVERSIFIED TELECOMMUNICATION - 4.92%
AT&T, Inc. ................................... 5,135,852 131,581
Fairpoint Communications, Inc. + ............. 42,246 44
Verizon Communications, Inc. ................. 3,192,746 96,868
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
Vodafone Group plc, ADR ...................... 1,930,000 $ 35,415
-----------
TOTAL TELECOMMUNICATION SERVICES ................ 263,908
-----------
UTILITIES - 5.98%
ELECTRIC UTILITIES - 4.66%
CenterPoint Energy, Inc. ..................... 2,029,200 21,591
Constellation Energy Group, Inc. ............. 710,100 17,099
Dominion Resources, Inc. ..................... 2,813,900 84,867
Edison International ......................... 135,300 3,857
Entergy Corp. ................................ 335,000 21,698
Exelon Corp. ................................. 385,600 17,788
FPL Group, Inc. .............................. 1,117,600 60,116
Public Service Enterprise Group, Inc. ........ 782,200 23,341
-----------
250,357
-----------
GAS UTILITIES - 0.76%
Spectra Energy Corp. ......................... 2,813,500 40,796
-----------
MULTI-UTILITIES - 0.56%
Questar Corp. ................................ 1,006,000 29,898
-----------
TOTAL UTILITIES ................................. 321,051
-----------
TOTAL COMMON STOCKS ............................. 5,071,644
-----------
CONVERTIBLE PREFERRED STOCKS - 0.07%
FINANCIALS - 0.07%
BANKS - 0.07%
East West Bancorp, Inc. ...................... 8,763 3,921
-----------
PREFERRED STOCKS - 0.07%
FINANCIALS - 0.07%
BANKS - 0.07%
Citigroup, Inc. .............................. 219,100 3,896
-----------
SHORT TERM INVESTMENTS - 5.22%
American Beacon U.S. Government Money Market
Select Fund +++ .............................. 60,000,000 60,000
Columbia Government Reserve Fund ................ 190,698,556 190,698
PAR AMOUNT
-----------
U.S. Treasury, 0.05%, Due 6/11/2009 # ........... $ 29,419 29,413
-----------
TOTAL SHORT TERM INVESTMENTS ....................... 280,111
-----------
See accompanying notes
8
AMERICAN BEACON LARGE CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
----------- -----------
(DOLLARS IN THOUSANDS)
SECURITIES LENDING
COLLATERAL - 0.97%
American Beacon U.S. Government Money Market
Select Fund +++ ........................... $11,112,475 $ 11,113
State Street Navigator Securities Lending Prime
Portfolio ................................. 40,650,218 40,650
-----------
TOTAL SECURITIES LENDING COLLATERAL ............. 51,763
-----------
TOTAL INVESTMENTS 100.85% - (COST $7,456,107) ...... 5,411,335
LIABILITIES, NET OF OTHER ASSETS - (0.85%) ......... (45,391)
-----------
TOTAL NET ASSETS - 100.00% ......................... $ 5,365,944
===========
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
+++ The Fund is affiliated by having the same investment advisor.
# At April 30, 2009, security pledged as collateral for open futures
contracts.
FUTURES CONTRACTS
(DOLLARS IN THOUSANDS)
UNREALIZED
NUMBER OF EXPIRATION MARKET APPRECIATION/
CONTRACTS DATE VALUE (DEPRECIATION)
--------- ---------- -------- --------------
Emini S&P 500 Index .. 6,445 Jun 2009 $280,358 $39,817
======== =======
See accompanying notes
9
AMERICAN BEACON LARGE CAP VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2009 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) (UNAUDITED)
ASSETS:
Investments in unaffiliated securities, at value (A C) ........................... $ 5,340,222
Investments in affiliated securities, at value (B) ............................... 71,113
Receivable for investments sold .................................................. 9,646
Dividends and interest receivable ................................................ 11,216
Receivable for fund shares sold .................................................. 5,778
Receivable for tax reclaims ...................................................... 231
Receivable for variation margin on open futures contracts ........................ 267
Prepaid expenses ................................................................. 122
------------
TOTAL ASSETS .................................................................. 5,438,595
------------
LIABILITIES:
Payable for investments purchased ................................................ 8,656
Payable upon return of securities loaned ......................................... 51,763
Payable for fund shares redeemed ................................................. 6,429
Management and investment advisory fees payable (Note 2) ......................... 3,306
Administrative service and service fees payable .................................. 1,985
Other liabilities ................................................................ 512
------------
TOTAL LIABILITIES ............................................................. 72,651
------------
NET ASSETS .......................................................................... $ 5,365,944
============
ANALYSIS OF NET ASSETS:
Paid-in-capital .................................................................. 9,156,904
Undistributed net investment income .............................................. 33,025
Accumulated net realized loss .................................................... (1,819,030)
Unrealized depreciation of investments, futures contracts, and foreign currency .. (2,004,955)
------------
NET ASSETS .......................................................................... $ 5,365,944
============
SHARES OUTSTANDING (NO PAR VALUE):
Institutional Class .............................................................. 132,745,170
============
Investor Class ................................................................... 243,315,004
============
Advisor Class .................................................................... 7,335,373
============
AMR Class ........................................................................ 32,599,036
============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE:
Institutional Class .............................................................. $ 13.29
============
Investor Class ................................................................... $ 12.66
============
Advisor Class .................................................................... $ 12.57
============
AMR Class ........................................................................ $ 13.14
============
- ----------
(A) Cost of investments in unaffiliated securities $ 7,384,994
(B) Cost of investments in affiliated securities $ 71,113
(C) Market value of securities on loan $ 50,857
See accompanying notes
10
AMERICAN BEACON LARGE CAP VALUE FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 2009 (IN THOUSANDS) (UNAUDITED)
INVESTMENT INCOME:
Dividend income from unaffiliated securities (net of foreign taxes)* ............. $ 89,396
Dividend income from affiliated securities ....................................... 549
Interest income .................................................................. 115
Income derived from securities lending, net ...................................... 1,668
---------
TOTAL INVESTMENT INCOME .................................................... 91,728
---------
EXPENSES:
Management and investment advisory fees (Note 2) ................................. 6,048
Administrative service fees (Note 2):
Institutional Class ........................................................... 2,531
Investor Class ................................................................ 4,500
Advisor Class ................................................................. 129
AMR Class ..................................................................... 103
Transfer agent fees:
Institutional Class ........................................................... 62
Investor Class ................................................................ 118
Advisor Class ................................................................. 3
AMR Class ..................................................................... 14
Custody and fund accounting fees ................................................. 389
Professional fees ................................................................ 107
Registration fees and expenses ................................................... 112
Service fees:
Investor Class (Note 2) ....................................................... 3,890
Advisor Class (Note 2) ........................................................ 107
Distribution fees - Advisor Class (Note 2) ....................................... 107
Prospectus and shareholder reports ............................................... 369
Trustee fees ..................................................................... 186
Other expenses ................................................................... 349
---------
TOTAL EXPENSES ............................................................. 19,124
---------
NET INVESTMENT INCOME ............................................................... 72,604
---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from:
Investments ................................................................... (471,113)
Commission recapture (Note 1) ................................................. 161
Futures contracts ............................................................. (179,118)
Change in net unrealized appreciation or depreciation of:
Investments ................................................................... (123,984)
Futures contracts ............................................................. 141,851
---------
NET LOSS ON INVESTMENTS .................................................... (632,203)
---------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS ............................... $(559,599)
=========
* Foreign taxes .................................................................. $ 477
See accompanying notes
11
AMERICAN BEACON LARGE CAP VALUE FUND
STATEMENT OF CHANGES OF NET ASSETS (IN THOUSANDS)
Six Months
Ended Year Ended
April 30, 2009 October 31, 2008
-------------- ----------------
(unaudited)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ............................................................ $ 72,604 $ 171,389
Net realized loss on investments, futures contracts, and foreign currency
transactions .................................................................. (650,070) (1,148,714)
Change in net unrealized appreciation or (depreciation) of investments, futures
contracts, and foreign currency translations .................................. 17,867 (3,031,895)
----------- -----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS .......................... (559,599) (4,009,220)
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Institutional Class ........................................................... (57,494) (41,356)
Investor Class ................................................................ (96,586) (76,907)
Advisor Class ................................................................. (2,701) (1,578)
AMR Class ..................................................................... (15,992) (16,885)
Net realized gain on investments:
Institutional Class ........................................................... -- (71,604)
Investor Class ................................................................ -- (153,834)
Advisor Class ................................................................. -- (3,382)
AMR Class ..................................................................... -- (26,071)
----------- -----------
NET DISTRIBUTIONS TO SHAREHOLDERS .......................................... (172,773) (391,617)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from sales of shares .................................................... 773,893 3,966,783
Reinvestment of dividends and distributions ...................................... 164,886 370,495
Cost of shares redeemed .......................................................... (1,070,110) (2,471,194)
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS ......... (131,331) 1,866,084
----------- -----------
NET (DECREASE) IN NET ASSETS ........................................................ (863,703) (2,534,753)
----------- -----------
NET ASSETS:
Beginning of period .............................................................. 6,229,647 8,764,400
----------- -----------
END OF PERIOD * .................................................................. $ 5,365,944 $ 6,229,647
=========== ===========
*Includes undistributed net investment income of .................................... $ 33,025 $ 133,193
=========== ===========
See accompanying notes
12
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
American Beacon Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, (the "Act") as a diversified, open-end management investment company.
These financial statements and notes to the financial statements relate to the
American Beacon Large Cap Value Fund (the "Fund"), a series of the Trust.
American Beacon Advisors, Inc. (the "Manager") is a wholly-owned subsidiary
of Lighthouse Holdings, Inc. and was organized in 1986 to provide business
management, advisory, administrative and asset management consulting services to
the Trust and other investors.
Class Disclosure
Prior to March 1, 2009, the Investor and Advisor Classes were known as the
PlanAhead and Service Classes, respectively.
The Fund has multiple classes of shares designed to meet the needs of
different groups of investors. The following table sets forth the differences
amongst the classes:
CLASS: OFFERED TO:
- ------ -----------
INSTITUTIONAL CLASS Investors making an initial investment of $2 million
INVESTOR CLASS General public and investors investing through an intermediary
ADVISOR CLASS Investors investing through an intermediary
AMR CLASS Investors in the tax-exempt retirement and benefit plans of AMR
Corporation and its affiliates
Administrative service fees, service fees and distribution fees vary
amongst the classes as described more fully in footnote 2.
Investment income, net capital gains (losses) and all expenses incurred by
the Fund are allocated based on the relative net assets of each class, except
for service fees and certain other fees and expenses related solely to one class
of shares.
Security Valuation
Investments are valued at the close of the New York Stock Exchange (the
"Exchange"), normally 4 p.m. ET, each day that the Exchange is open for
business. Equity securities for which market quotations are available are valued
at the last sale price or official closing price (closing bid price or last
evaluated quote if no sale has occurred) on the primary market or exchange on
which they trade.
Debt securities (other than short-term securities) normally are valued on
the basis of prices provided by an independent pricing service and may take into
account appropriate factors such as institution-size trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data. The prices of debt securities may be
determined using quotes obtained from brokers.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation. Investment grade short-term
obligations with 60 days or less to maturity are valued using the amortized cost
method, which approximates market value.
Securities for which market prices are not readily available or are not
reflective of the fair value of the security, as determined by the Manager, will
be priced at fair value following procedures approved by the Board of Trustees
(the "Board").
13
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
The Fund adopted the provisions of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective with the
beginning of the Fund's fiscal year. The standard clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires additional disclosures about the use of fair value
measurements. The three levels of the hierarchy under FAS 157 are described
below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Prices determined using other significant observable inputs.
These may include quoted prices for similar securities,
interest rates, prepayment speeds, credit risk, and others.
Level 3 - Prices determined using other significant unobservable
inputs. Unobservable inputs reflect the Fund's own
assumptions about the factors market participants would use
in pricing an investment, and would be based on the best
information available.
A summary of the inputs used to value the Fund's investments as of April 30,
2009 is as follows (in thousands):
Investments in Other Financial
Valuation Inputs Securities Instruments*
---------------- -------------- ---------------
Level 1 - Quoted prices........................ $5,381,922 $39,817
Level 2 - Other significant observable inputs.. 29,413 --
Level 3 - Significant unobservable inputs..... -- --
---------- -------
Total.......................................... $5,411,335 $39,817
---------- -------
* Other financial instruments are futures.
Security Transactions and Investment Income
Security transactions are recorded on the trade date of the security
purchase or sale. The Fund may purchase securities with delivery or payment to
occur at a later date. At the time the Fund enters into a commitment to purchase
a security, the transaction is recorded, and the value of the security is
reflected in the net asset value. The value of the security may vary with market
fluctuations.
Dividend income, net of foreign taxes, is recorded on the ex-dividend date.
Interest income is earned from settlement date, recorded on the accrual basis,
and adjusted, if necessary, for accretion of discounts and amortization of
premiums. For financial and tax reporting purposes, realized gains and losses
are determined on the basis of specific lot identification.
Futures Contracts
Futures contracts are contracts to buy or sell a standard quantity of
securities at a specified price on a future date. The Fund may enter into
financial futures contracts as a method for keeping assets readily convertible
to cash if needed to meet shareholder redemptions or for other needs while
maintaining exposure to the stock or bond market, as applicable. The primary
risks associated with the use of futures contracts are the possibility of
illiquid markets or imperfect correlation between the values of the contracts
and the underlying securities, or that the counterparty will fail to perform its
obligations.
Upon entering into a futures contract, the Fund is required to set aside or
deposit with a broker an amount, termed the initial margin, which typically
represents 5% of the face value of the futures contract. The Fund reflects this
amount on the Schedule of Investments as a U.S. Treasury Bill held as collateral
for futures contracts. Payments to and from the broker, known as variation
margin, are required to be made on a daily basis as the price of the futures
contract fluctuates. Changes in initial settlement values are accounted for as
unrealized appreciation (depreciation) until the contracts are terminated, at
which time realized gains and
14
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
losses are recognized. Futures contracts are valued at the most recent
settlement price established each day by the exchange on which they are traded.
Dividends to Shareholders
Dividends from net investment income of the Fund normally will be declared
and paid at least annually. Distributions, if any, of net realized capital gains
are generally paid at least annually and recorded on the ex-dividend date.
Commission Recapture
The Fund has established brokerage commission recapture arrangements with
certain brokers or dealers. If the Fund's investment advisor chooses to execute
a transaction through a participating broker, the broker rebates a portion of
the commission back to the Fund. Any collateral benefit received through
participation in the commission recapture program is directed exclusively to the
Fund. This amount is reported with the net realized gain in the Fund's Statement
of Operations.
Allocation of Income, Expenses, Gains and Losses
Income, expenses (other than those attributable to a specific class), gains
and losses are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses directly
attributable to a specific class are charged against the operations of that
class.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimated.
Recently Issued Accounting Pronouncements
In March 2008, FASB issued Statement of Financial Accounting Standards No.
161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"), which is effective for fiscal years and interim periods beginning after
November 15, 2008. FAS 161 requires enhanced disclosures about derivative and
hedging activities, including how such activities are accounted for and their
effect on financial positions, performance and cash flows. The Manager is
currently evaluating the impact the adoption of FAS 161 will have on the Fund's
financial statements and related disclosures.
Other
Under the Trust's organizational documents, its officers and directors are
indemnified against certain liability arising out of the performance of their
duties to the Trust. In the normal course of business, the Trust enters into
contracts that provide indemnification to the other party or parties against
potential costs or liabilities. The Trust's maximum exposure under these
arrangements is dependent on claims that may be made in the future and,
therefore, cannot be estimated. The Trust has had no prior claims or losses
pursuant to any such agreement.
15
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
2. TRANSACTIONS WITH AFFILIATES
Management Agreement
The Trust and the Manager are parties to a Management Agreement that
obligates the Manager to provide or oversee the provision of all administrative,
investment advisory, fund management and securities lending services. Investment
assets of the Fund are managed by multiple investment advisors that have entered
into separate investment advisory agreements with the Manager. As compensation
for performing the duties required under the Management Agreement, the Manager
receives from the Fund an annualized fee equal to 0.05% of the average daily net
assets plus amounts paid by the Manager to the investment advisors hired by the
Manager to direct investment activities of the Funds. Management fees paid
during the six months ended April 30, 2009 were as follows (dollars in
thousands):
AMOUNTS PAID NET AMOUNTS
MANAGEMENT FEE MANAGEMENT TO INVESTMENT RETAINED BY
RATE FEE ADVISORS MANAGER
- -------------- ---------- ------------- -----------
0.175%-0.65% $6,048 $4,751 $1,297
As compensation for services provided by the Manager in connection with
securities lending activities, the Fund pays to the Manager, with respect to
cash collateral posted by borrowers, a fee up to 25% of the net monthly interest
income (the gross interest income earned by the investment of cash collateral,
less the amount paid to borrowers and related expenses) from such activities
and, with respect to loan fees paid by borrowers when a borrower posts
collateral other than cash, a fee up to 25% of such loan fees. This fee is
netted against securities lending income in the Statement of Operations. During
the six months ended April 30, 2009, securities lending fees paid to the Manager
by the Fund were $250,191.
Administrative Services Agreement
The Manager and the Trust entered into an Administrative Services Agreement
which obligates the Manager to provide or oversee administrative services to the
Fund. As compensation for performing the duties required under the
Administrative Services Agreement, the Manager receives an annualized fee of
0.30% of the average daily net assets of the Institutional, Investor, and
Advisor Classes of the Fund and 0.05% of the average daily net assets of the AMR
Class of the Fund.
Distribution Plans
The Fund, except for the Advisor Class of the Fund, has adopted a
"defensive" Distribution Plan (the "Plan") in accordance with Rule 12b-1 under
the Act, pursuant to which no fees may be charged to the Fund for distribution
purposes. However, the Plan authorizes the management and administrative service
fees received by the Manager and the investment advisors hired by the Manager to
be used for distribution purposes. Under this Plan, the Fund does not intend to
compensate the Manager or any other party, either directly or indirectly, for
the distribution of Fund shares.
A separate Distribution Plan (the "Distribution Plan") has been adopted
pursuant to Rule 12b-1 under the Act for the Advisor Class of the Fund. Under
the Distribution Plan, as compensation for distribution assistance, the Manager
receives an annual fee of 0.25% of the average daily net assets of the Advisor
Class. The fee will be payable without regard to whether the amount of the fee
is more or less than the actual expenses incurred in a particular month by the
Manager for distribution assistance.
Service Plans
The Manager and the Trust entered into Service Plans that obligate the
Manager to oversee additional shareholder servicing of the Investor and Advisor
Classes. As compensation for performing the duties required
16
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
under the Service Plans, the Manager receives up to 0.375% of the average daily
net assets of the Investor Class and 0.25% of the average daily net assets of
the Advisor Class of the Fund.
Investment in Affiliated Funds
The Fund may invest in the American Beacon Money Market Select Fund (the
"MM Select Fund") and the American Beacon US Government Money Market Select Fund
(the "USG Select Fund"), (collectively the "Select Funds"). Cash collateral
received by the Fund in connection with securities lending may be invested in
the Select Funds. The Select Funds and the Fund have the same investment advisor
and therefore, are considered to be affiliated. The Manager serves as investment
advisor to the Select Funds and receives from the Select Funds an annualized fee
of 0.09% of its average daily net assets of the Select Funds. During the six
months ended April 30, 2009, the Manager earned fees from the Select Funds
totaling $40,946 on the Fund's direct investment in the Select Funds and $17,097
from the Fund's securities lending collateral invested in the Select Funds.
Interfund Lending Program
Pursuant to an exemptive order by the Securities and Exchange Commission
("SEC"), the Fund, along with other registered investment companies having
management contracts with the Manager, may participate in an interfund lending
program as a borrower. This program provides an alternative credit facility
allowing the Fund to borrow from other participating Funds. For the six months
ended April 30, 2009, the Fund did not utilize the credit facility.
Expense Reimbursement Plan
The Fund has adopted an Expense Reimbursement Plan whereby the manager may
seek repayment of fees waived or expenses reimbursed for a period of up to three
years. However, reimbursement will occur only if the Class' average net assets
have grown or expenses have declined sufficiently to allow reimbursement without
causing its expense ratio to exceed the previously agreed upon contractual
expense limit. During the six months ended April 30, 2009, there were no fees
waived or reimbursed expenses subject to potential recovery.
3. FEDERAL INCOME AND EXCISE TAXES
It is the policy of the Fund to comply with the requirements of Subchapter
M of the Internal Revenue Code and to distribute substantially all net
investment income as well as any net realized capital gains on the sale of
investments. Therefore, no federal income or excise tax provision is required.
The Fund adopted the provisions of FASB Interpretation No. 48, "Accounting
for Uncertainties in Income Taxes" ("FIN 48"), on January 1, 2007. FIN 48 sets
forth a minimum threshold for financial statement recognition of the benefit of
a tax position taken or expected to be taken in a tax return. The implementation
of FIN 48 did not result in any unrecognized tax benefits in the accompanying
financial statements. Each of the tax years in the three year period ended
October 31, 2008 remains subject to examination by the Internal Revenue Service.
If applicable, the Fund recognizes interest accrued related to unrecognized tax
benefits in interest expense and penalties in "Other expenses" on the Statement
of Operations.
Dividends are categorized in accordance with income tax regulations which
may treat certain transactions differently than U.S. generally accepted
accounting principles. Accordingly, the character of distributions and
composition of net assets for tax purposes may differ from those reflected in
the accompanying financial statements.
The tax character of distributions paid during the six months ended April
30, 2009 and the fiscal year ended October 31, 2008 were as follows (in
thousands):
17
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
SIX MONTHS ENDED YEAR ENDED
APRIL 30, OCTOBER 31,
2009 2008
---------------- -------------
(unaudited)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class .. $ 57,494 $ 65,641
Investor Class ....... 96,586 129,081
Advisor Class ........ 2,701 2,725
AMR Class ............ 15,992 25,728
LONG-TERM CAPITAL GAIN
Institutional Class .. -- 47,318
Investor Class ....... -- 101,660
Advisor Class ........ -- 2,235
AMR Class ............ -- 17,229
-------- --------
TOTAL DISTRIBUTIONS PAID ... $172,773 $391,617
======== ========
* For tax purposes, short-term capital gains are considered ordinary income
distributions.
As of April 30, 2009, the components of distributable earnings on a tax basis
were as follows (in thousands):
Cost basis of investments for federal income tax purposes .. $ 7,699,793
Unrealized appreciation .................................... 167,091
Unrealized depreciation .................................... (2,455,549)
-----------
Net unrealized appreciation/(depreciation) ................. (2,288,458)
Undistributed ordinary income .............................. 33,025
Undistributed long-term gain/(loss) ........................ (1,535,584)
-----------
Distributable earnings ..................................... $(3,791,017)
===========
Financial reporting records are adjusted for permanent book/tax differences
to reflect tax character. Financial records are not adjusted for temporary
differences. The temporary differences between financial reporting and tax-basis
reporting of unrealized appreciation/(depreciation) are attributable primarily
to the tax deferral of losses from wash sales and the realization for tax
purposes of unrealized gains/(losses) on certain derivative instruments.
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under U.S. generally accepted accounting principles and
federal income tax regulations, permanent differences between book and tax
reporting have been identified and appropriately reclassified on the Statement
of Assets and Liabilities.
Accordingly, the following amounts represent current year permanent
differences derived from reclassifications of income from real estate investment
securities, foreign currency, and dividend reclasses that have been reclassified
as of April 30, 2009 (in thousands):
Paid-in-capital............................................. $ 1
Undistributed net investment income......................... 1
Accumulated net realized gain (loss)........................ (2)
Unrealized appreciation (depreciation) of investments,
futures contracts and foreign currency................... --
At April 30, 2009, the capital loss carry forward position of the Fund for
federal income tax purposes was $ 1,044,692 and $490,892 expiring in 2016 and
2017, respectively.
4. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales of investments, other
than short-term obligations, for the six months ended April 30, 2009 were (in
thousands) $920,501 and $664,592, respectively.
18
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
A summary of the Fund's direct transactions in the Select Funds for the six
months ended April 30, 2009 is set forth below (in thousands):
OCTOBER 31, 2008 APRIL 30, 2009
AFFILIATE SHARES/MARKET VALUE PURCHASES SALES SHARES/MARKET VALUE
- --------- ------------------- --------- -------- -------------------
MM Select Fund $362,064 $ -- $362,064 $ --
USG Select Fund $ -- $60,000 $ -- $60,000
5. SECURITIES LENDING
The Fund may lend its securities to qualified financial institutions, such
as certain broker-dealers, to earn additional income. The borrowers are required
to secure their loans continuously with collateral in an amount at least equal
to the fair value of the securities loaned, initially in an amount at least
equal to 102% of the fair value of domestic securities loaned and 105% of the
fair value of international securities loaned. Collateral is monitored and
marked to market daily. Daily mark to market amounts are required to be paid to
the borrower or received from the borrower by the end of the following business
day. This one day settlement for mark to market amounts may result in the
collateral being temporarily less than the value of the securities on loan or
temporarily more than the required minimum collateral. The amount of this
temporary difference at April 30, 2009 is disclosed as the calculated mark in
the table below.
To the extent that a loan is collateralized by cash, such cash collateral
shall be invested by the securities lending agent (the "Agent") in money market
mutual funds and other short-term investments, provided the investments meet
certain quality and diversification requirements.
Securities lending income is generated from the demand premium (if any)
paid by the borrower to borrow a specific security and from the return on
investment of cash collateral, reduced by negotiated rebate fees paid to the
borrower and transaction costs. To the extent that a loan is secured by non-cash
collateral, securities lending income is generated as a demand premium reduced
by transaction costs. The Fund, the Agent, and the Manager retain 75%, 15%, and
10%, respectively, of the income generated from securities lending.
While securities are on loan, the Fund continues to receive any income
associated with that security and any gain or loss in the market price that may
occur during the term of the loan.
Securities lending transactions pose certain risks to the Fund, including
that the borrower may not provide additional collateral when required or return
the securities when due, that the value of the short-term investments will be
less than the amount of cash collateral required to be returned to the borrower,
that non-cash collateral may be subject to legal constraints in the event of a
borrower bankruptcy, and that the cash collateral investments could become
illiquid and unable to be used to return collateral to the borrower. The Fund
could also experience delays and costs in gaining access to the collateral. The
Fund bears the risk of any deficiency in the amount of the cash collateral
available for return to the borrower and any action which impairs its ability to
liquidate non-cash collateral to satisfy a borrower default.
At April 30, 2009, the value of outstanding securities on loan and the
value of collateral was as follows (in thousands):
MARKET VALUE OF TOTAL VALUE OF
SECURITIES ON LOAN NON-CASH COLLATERAL CASH COLLATERAL POSTED BY BORROWER CALCULATED MARK COLLATERAL
- ------------------ ------------------- ---------------------------------- --------------- --------------
$50,857 -- $51,763 619 $52,382
Cash collateral is listed in the Fund's Schedule of Investments and
included in the Statement of Assets and Liabilities. Income earned on these
investments is included in Income derived from securities lending in the
Statement of Operations.
19
AMERICAN BEACON LARGE CAP VALUE FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Non-cash collateral received by the Fund may not be sold or re-pledged
except to satisfy a borrower default. Therefore, non-cash collateral is not
included on the Fund's Schedule of Investments or Statement of Assets and
Liabilities.
6. CAPITAL SHARE TRANSACTIONS
The tables below summarize the activity in capital shares for each Class of
the Fund (dollars and shares in thousands):
Six months Ended April 30, 2009
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
------------------- ------------------- ----------------- -----------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
------- --------- ------- --------- ------ -------- ------ --------
Shares sold ................ 21,324 $ 271,189 38,901 $ 474,982 987 $ 11,867 1,258 $ 15,855
Reinvestment of dividends .. 4,043 53,008 7,465 93,236 213 2,650 1,236 15,992
Shares redeemed ............ (28,427) (361,263) (54,660) (657,760) (872) (10,414) (3,314) (40,673)
------ --------- ------- --------- ---- -------- ------ --------
Net increase (decrease) in
shares outstanding ...... (3,060) $ (37,066) (8,294) $ (89,542) 328 $ 4,103 (820) $ (8,826)
====== ========= ======= ========= ==== ======== ====== ========
Year Ended October 31, 2008
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
-------------------- --------------------- ----------------- ------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
------- ---------- ------- ----------- ------ -------- ------ ---------
Shares sold ................ 72,124 $1,522,430 113,619 $ 2,297,576 5,559 $111,669 1,693 $ 35,108
Reinvestment of dividends .. 4,204 99,590 9,867 222,989 220 4,960 1,833 42,956
Shares redeemed ............ (36,318) (729,713) (81,231) (1,524,704) (2,814) (55,162) (7,797) (161,615)
------- ---------- ------- ----------- ------ -------- ------ ---------
Net increase (decrease) in
shares outstanding ...... 40,010 $ 892,307 42,255 $ 995,861 2,965 $ 61,467 (4,271) $ (83,551)
======= ========== ======= =========== ====== ======== ====== =========
20
AMERICAN BEACON LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGH THE PERIOD)
Institutional Class
-------------------------------------------------------------------------
Six Months Year Ended October 31,
Ended April --------------------------------------------------------
30, 2009 2008 2007 2006 2005 2004
------------ ---------- ---------- -------- -------- -------
(unaudited)
Net asset value, beginning of period ............. $ 15.01 $ 26.03 $ 23.77 $ 21.00 $ 18.23 $ 15.62
---------- ---------- ---------- -------- -------- -------
Income from investment operations:
Net investment income(A,B) .................... 0.20 0.51 0.40 0.31 0.28 0.26
Net gains (losses) on securities (both realized
and unrealized) ............................ (1.48) (10.41) 2.78 3.48 2.74 2.62
---------- ---------- ---------- -------- -------- -------
Total income (loss) from investment operations ... (1.28) (9.90) 3.18 3.79 3.02 2.88
---------- ---------- ---------- -------- -------- -------
Less distributions:
Dividends from net investment income .......... (0.44) (0.41) (0.31) (0.26) (0.25) (0.27)
Distributions from net realized gains on
securities ................................. -- (0.71) (0.61) (0.76) -- --
---------- ---------- ---------- -------- -------- -------
Total distributions .............................. (0.44) (1.12) (0.92) (1.02) (0.25) (0.27)
---------- ---------- ---------- -------- -------- -------
Net asset value, end of period ................... $ 13.29 $ 15.01 $ 26.03 $ 23.77 $ 21.00 $ 18.23
========== ========== ========== ======== ======== =======
Total return ..................................... (8.46)%(C) (39.59)% 13.76% 18.69% 16.64% 18.59%
========== ========== ========== ======== ======== =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $1,764,808 $2,038,539 $2,493,451 $958,830 $201,111 $48,451
Ratios to average net assets (annualized):
Expenses, net of waivers ................... 0.60% 0.58% 0.59% 0.60% 0.60% 0.66%
Expenses, before waivers ................... 0.60% 0.58% 0.59% 0.60% 0.60% 0.66%
Net investment income, net of waivers ...... 2.93% 2.19% 1.82% 1.86% 1.58% 1.49%
Net investment income (loss), before
waivers ................................. 2.93% 2.19% 1.82% 1.86% 1.58% 1.49%
Portfolio turnover rate ....................... 14%(C) 28% 20% 26% 25% 29%
(A) Through October 31, 2005, net investment income was calculated by
subtracting class expenses per share from the Fund's net investment income
per share before class expenses.
(B) For purposes of this calculation, through October 31, 2007, the change in
undistributed net investment income per share was derived by dividing the
change in undistributed net investment income by average shares
outstanding.
(C) Not annualized.
21
AMERICAN BEACON LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Investor Class
----------------------------------------------------------------------------
Six Months Year Ended October 31,
Ended April -----------------------------------------------------------
30, 2009 2008 2007 2006 2005 2004
----------- ---------- ---------- ---------- --------- -------
(unaudited)
Net asset value, beginning of period ............. $ 14.29 $ 24.83 $ 22.74 $ 20.16 $ 17.54 $ 15.05
---------- ---------- ---------- ---------- -------- -------
Income from investment operations:
Net investment income(A, B) ................... 0.17 0.41 0.35 0.28 0.27 0.23
Net gains (losses) on securities (both
realized and unrealized) ................... (1.40) (9.88) 2.63 3.31 2.58 2.49
---------- ---------- ---------- ---------- -------- -------
Total income (loss) from investment operations ... (1.23) (9.47) 2.98 3.59 2.85 2.72
---------- ---------- ---------- ---------- -------- -------
Less distributions:
Dividends from net investment income .......... (0.40) (0.36) (0.28) (0.25) (0.23) (0.23)
Distributions from net realized gains on
securities ................................. -- (0.71) (0.61) (0.76) -- --
---------- ---------- ---------- ---------- -------- -------
Total distributions .............................. (0.40) (1.07) (0.89) (1.01) (0.23) (0.23)
---------- ---------- ---------- ---------- -------- -------
Net asset value, end of period ................... $ 12.66 $ 14.29 $ 24.83 $ 22.74 $ 20.16 $ 17.54
========== ========== ========== ========== ======== =======
Total return ..................................... (8.59)%(C) (39.72)% 13.46% 18.44% 16.33% 18.26%
========== ========== ========== ========== ======== =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $3,080,661 $3,594,565 $5,198,835 $2,586,410 $526,357 $51,489
Ratios to average net assets (annualized):
Expenses, net of waivers ................... 0.86% 0.83% 0.83% 0.85% 0.86% 0.94%
Expenses, before waivers ................... 0.86% 0.83% 0.83% 0.85% 0.86% 0.94%
Net investment income, net of waivers ...... 2.67% 1.94% 1.59% 1.61% 1.30% 1.21%
Net investment income (loss), before
waivers ................................. 2.67% 1.94% 1.59% 1.61% 1.30% 1.21%
Portfolio turnover rate ....................... 14%(C) 28% 20% 26% 25% 29%
(A) Through October 31, 2005, net investment income was calculated by
subtracting class expenses per share from the Fund's net investment income
per share before class expenses.
(B) For purposes of this calculation, through October 31, 2007, the change in
undistributed net investment income per share was derived by dividing the
change in undistributed net investment income by average shares
outstanding.
(C) Not annualized.
22
AMERICAN BEACON LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGH THE PERIOD)
Advisor Class
-----------------------------------------------------
Six
Months May
Ended Year Ended October 31, 31 to
April 30, ---------------------------- October
2009 2008 2007 2006 31, 2005
----------- ------- ------- ------- --------
(unaudited)
Net asset value, beginning of period ............. $ 14.19 $ 24.70 $ 22.64 $ 20.13 $ 19.33
------- ------- ------- ------- -------
Income from investment operations:
Net investment income(A,B) .................... 0.15 0.32 0.28 0.26 0.01
Net gains (losses) on securities (both realized
and unrealized) ............................ (1.39) (9.79) 2.62 3.27 0.79
------- ------- ------- ------- -------
Total income (loss) from investment operations ... (1.24) (9.47) 2.90 3.53 0.80
------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income .......... (0.38) (0.33) (0.23) (0.26) --
Distributions from net realized gains on
securities ................................. -- (0.71) (0.61) (0.76) --
------- ------- ------- ------- -------
Total distributions .............................. (0.38) (1.04) (0.84) (1.02) --
------- ------- ------- ------- -------
Net asset value, end of period ................... $ 12.57 $ 14.19 $ 24.70 $ 22.64 $ 20.13
======= ======= ======= ======= =======
Total return ..................................... (8.68)%(C) (39.87)% 13.16% 18.18% 4.14%
======= ======= ======= ======= =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $92,208 $99,416 $99,854 $39,077 $11,604
Ratios to average net assets (annualized):
Expenses, net of waivers ................... 1.10% 1.08% 1.08% 1.09% 1.14%(D)
Expenses, before waivers ................... 1.10% 1.08% 1.08% 1.09% 1.77%(D)
Net investment income, net of waivers ...... 2.42% 1.69% 1.32% 1.39% 1.72%(D)
Net investment income (loss), before
waivers ................................. 2.42% 1.69% 1.32% 1.39% 1.09%(D)
Portfolio turnover rate ....................... 14%(C) 28% 20% 26% 25%(E)
(A) Through October 31, 2005, net investment income was calculated by
subtracting class expenses per share from the Fund's net investment income
per share before class expenses.
(B) For purposes of this calculation, through October 31, 2007, the change in
undistributed net investment income per share was derived by dividing the
change in undistributed net investment income by average shares
outstanding.
(C) Not annualized.
(D) Annualized.
(E) Portfolio turnover rate is for the period from November 1, 2004 through
October 31, 2005.
23
AMERICAN BEACON LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
AMR Class
---------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ------------------------------------------------------
2009 2008 2007 2006 2005 2004
----------- -------- -------- ---------- -------- --------
(unaudited)
Net asset value, beginning of period ............. $ 14.88 $ 25.80 $ 23.55 $ 20.78 $ 18.02 $ 15.44
-------- -------- -------- ---------- -------- --------
Income from investment operations:
Net investment income(A, B) ................... 0.20 0.51 0.45 0.35 0.31 0.30
Net gains (losses) on securities (both realized
and unrealized) ............................ (1.45) (10.26) 2.76 3.47 2.73 2.58
-------- -------- -------- ---------- -------- --------
Total income (loss) from investment operations ... (1.25) (9.75) 3.21 3.82 3.04 2.88
-------- -------- -------- ---------- -------- --------
Less distributions:
Dividends from net investment income .......... (0.49) (0.46) (0.35) (0.29) (0.28) (0.30)
Distributions from net realized gains on
securities ................................. -- (0.71) (0.61) (0.76) -- --
-------- -------- -------- ---------- -------- --------
Total distributions .............................. (0.49) (1.17) (0.96) (1.05) (0.28) (0.30)
-------- -------- -------- ---------- -------- --------
Net asset value, end of period ................... $ 13.14 $ 14.88 $ 25.80 $ 23.55 $ 20.78 $ 18.02
======== ======== ======== ========== ======== ========
Total return ..................................... (8.34)%(C) (39.43)% 14.03% 19.08% 16.95% 18.89%
======== ======== ======== ========== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $428,267 $497,127 $972,260 $1,024,899 $848,219 $696,206
Ratios to average net assets (annualized):
Expenses, net of waivers ................... 0.35% 0.32% 0.32% 0.34% 0.35% 0.39%
Expenses, before waivers ................... 0.35% 0.32% 0.32% 0.34% 0.35% 0.39%
Net investment income, net of waivers ...... 3.18% 2.44% 2.13% 2.18% 1.87% 1.79%
Net investment income (loss), before
waivers ................................. 3.18% 2.44% 2.13% 2.18% 1.87% 1.79%
Portfolio turnover rate ....................... 14%(C) 28% 20% 26% 25% 29%
(A) Through October 31, 2005, net investment income was calculated by
subtracting class expenses per share from the Fund's net investment income
per share before class expenses.
(B) For purposes of this calculation, through October 31, 2007, the change in
undistributed net investment income per share was derived by dividing the
change in undistributed net investment income by average shares
outstanding.
(C) Not annualized.
24
This page intentionally left blank.
25
(AMERICAN BEACON FUNDS(SM) LOGO)
DELIVERY OF DOCUMENTS
To reduce expenses, your financial institution may mail only one copy of the
Prospectus, Annual Report and Semi-Annual Report to those addresses shared by
two or more accounts. If you wish to receive individual copies of these
documents, please contact your financial institution. Delivery of individual
copies will commence thirty days after receiving your request.
If you invest in the Fund through a financial institution, you may be able to
receive the Fund's regulatory mailings, such as the Prospectus, Annual Report
and Semi-Annual Report, by e-mail. If you are interested in this option, please
go to www.icsdelivery.com and search for your financial institution's name or
contact your financial institution directly.
TO OBTAIN MORE INFORMATION ABOUT THE FUND:
(GRAPHIC)
BY E-MAIL:
american_beacon.funds@ambeacon.com
(GRAPHIC)
BY TELEPHONE:
Institutional Class
Call (800) 658-5811
AMR Class(SM)
Call (800) 345-2345
Investor Class(R) and Advisor Class
Call (800) 388-3344
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
In addition to the Schedule of Investments provided in each semi-annual and
annual report, the Fund files a complete schedule of its portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q as of the first and
third fiscal quarters. The Fund's Forms N-Q are available on the SEC's website
at www.sec.gov. The Forms N-Q may also be reviewed and copied at the SEC's
Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549. Information
regarding the operation of the SEC's Public Reference Room may be obtained by
calling 1-800-SEC-0330. A complete schedule of the Fund's portfolio holdings is
also available on the Funds' website (www.americanbeaconfunds.com) approximately
thirty days after the end of each month.
(GRAPHIC)
ON THE INTERNET:
Visit our website at www.americanbeaconfunds.com
(GRAPHIC)
BY MAIL:
American Beacon Funds
P.O. Box 219643
Kansas City, MO 64121-9643
AVAILABILITY OF PROXY VOTING POLICY AND RECORDS
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available in the Fund's
Statement of Additional Information, is available free of charge on the Fund's
website (www.americanbeaconfunds.com) and by calling 1-800-967-9009 or by
accessing the SEC's website at www.sec.gov. The Fund's proxy voting record for
the most recent year ended June 30 is filed annually with the SEC on Form N-PX.
The Fund's Forms N-PX are available on the SEC's website at www.sec.gov. The
Fund's proxy voting record may also be obtained by calling 1-800-967-9009.
FUND SERVICE PROVIDERS:
CUSTODIAN TRANSFER AGENT INDEPENDENT REGISTERED DISTRIBUTOR
STATE STREET BANK AND BOSTON FINANCIAL DATA PUBLIC ACCOUNTING FIRM FORESIDE FUND SERVICES
TRUST SERVICES ERNST & YOUNG LLP Portland, Maine
Boston, Massachusetts Kansas City, Missouri Dallas, Texas
This report is prepared for shareholders of the American Beacon Funds and may be
distributed to others only if preceded or accompanied by a current prospectus.
American Beacon Funds and the American Beacon Large Cap Value Fund are service
marks of American Beacon Advisors, Inc.
SAR 4/09
00068039
GUIDANCE | VISION | EXPERIENCE
(AMERICAN BEACON FUNDS(SM) LOGO)
SEMI - ANNUAL REPORT
(GRAPHIC)
APRIL 30, 2009
SMALL CAP VALUE FUND
About American Beacon Advisors
Since 1986, American Beacon Advisors has offered a variety of products and
investment advisory services to numerous institutional and retail clients,
including a variety of mutual funds, corporate cash management, and separate
account management.
Our clients include defined benefit plans, defined contribution plans,
foundations, endowments, corporations, financial planners, and other
institutional investors. With American Beacon Advisors, you can put the
experience of a multi-billion dollar asset management firm to work for your
company.
Contents
Message from American Beacon .................................. 1
Market and Performance Overview ............................... 2
Schedule of Investments ....................................... 6
Additional Information ........................................ Back Cover
Any opinions herein, including forecasts, reflect our judgment as of the end of
the reporting period and are subject to change. Each advisor's strategies and
the Fund's portfolio composition will change depending on economic and market
conditions. This report is not a complete analysis of market conditions and
therefore, should not be relied upon as investment advice. Although economic and
market information has been compiled from reliable sources, American Beacon
Advisors, Inc. makes no representation as to the completeness or accuracy of the
statements contained herein.
Investing in the securities of small capitalization companies involves greater
risk and the possibility of greater price volatility than investing in larger
capitalization and more established companies.
American Beacon Funds April 30, 2009
(PHOTO OF GENE L. NEEDLES)
FELLOW SHAREHOLDERS,
Please allow me to introduce myself. I am Gene Needles, Jr., the new
Executive Vice President for the American Beacon Funds. I have over 27 years of
financial services experience with some of the country's largest fund complexes,
and I will be primarily responsible for daily operations as well as distribution
of the American Beacon Funds. I am very excited to be a part of American Beacon
and look forward to building a lasting relationship with all of our
shareholders.
Enclosed is the American Beacon Funds Semi-Annual Report for the six months
ended April 30, 2009 for the American Beacon Small Cap Value Fund.
During the six-month period covered by this report, the capital markets
experienced widespread volatility brought on by concern over the world-wide
credit crisis. The American Beacon Small Cap Value Fund - Institutional Class
reported a six-month return of -3.27% for the period ended April 30, 2009, while
the S&P 500 and Dow Jones Industrial Average Indices reported returns of -8.53
and -10.79%, respectively, for this period.
In the past, long-term investors have been rewarded for their patience. We
continue to believe the Fund's fundamental investment strategy and lower than
average expense ratio will continue to serve the Fund well over time.
Please review the enclosed market overview, portfolio listings, and
detailed financial data. As always, we welcome the opportunity to serve your
financial needs. To obtain further details about the American Beacon Funds
family or to access your account information, please visit our website at
www.americanbeaconfunds.com. Thank you for your continued confidence in the
American Beacon Funds.
Sincerely,
/s/ Gene L. Needles, Jr.
Gene L. Needles, Jr.
Executive Vice President
American Beacon Funds
1
DOMESTIC EQUITY MARKET OVERVIEW
APRIL 30, 2009 (UNAUDITED)
A tale of two markets might be the most accurate description of the
six-month period ended April 30, 2009. The equity markets were down overall for
the six months, as represented by a decline of 8.5% for the S&P 500, but for the
first four months, the S&P 500 fell a breath-taking 23.2%. Through February,
bleak economic performance around the world set the background for equity market
declines. In addition to the well publicized economic distress in the U.S., the
period featured news of staggering declines in Japanese manufacturing and sharp
declines in Asian and Eastern European exports. The U.K. and Western Europe
continued to be weak, with the Bank of England purchasing U.K. government debt
in an aggressive move to quantitative easing as its benchmark interest rate came
close to zero. Latin America slowed down, with Mexico in a deep recession. China
was the global exception with domestic demand appearing to hold up and loan
creation remaining solid.
Starting in March, equities staged a dramatic recovery in the face of
continued poor economic data, providing support for the view that valuations
ultimately drive stock prices. The U.S. government's announcement of details on
initiatives to stabilize the banking and housing market appeared to spark the
rally. Although some economic data points began to show a hint of economic
stability (or at least a deceleration in the rate of decline) toward the end of
April, it is still too early to call an improvement in the economy. However, it
is apparent that because the market was trading at such deeply depressed,
pessimistic levels, the mere hint of a recovery was enough to cause a
significant rally. Thus for March and April, the S&P 500 was up 19.2%, unwinding
a large part of the earlier months' declines.
2
PERFORMANCE OVERVIEW
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Small Cap Value Fund returned -3.27% for the
six months ended April 30, 2009, outperforming the Russell 2000(R) Value Index
("Index") return of -12.61% and the Lipper Small-Cap Value Funds Index return of
- -5.16% for the same period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
--------- ------ ------- --------
Institutional Class
(1, 4)............... -3.27% -31.10% -1.47% 7.21%
Investor Class(1, 4).... -3.34% -31.24% -1.71% 6.94%
Advisor Class(1, 2, 4).. -3.50% -31.43% -1.97% 6.76%
AMR Class(1, 4)......... -3.09% -30.89% -1.20% 7.50%
Lipper Small-Cap
Value Funds
Index(3)............. -5.16% -29.97% -0.79% 6.14%
Russell 2000 Value
Index (3)............ -12.61% -31.37% -1.42% 5.51%
* Not annualized
(1.) The Investor and Advisor Classes were formerly known as the PlanAhead and
Service Classes, respectively. Performance shown is historical and may not
be indicative of future returns. Investment returns and principal value
will vary, and shares may be worth more or less at redemption than at
original purchase. Performance shown is as of date indicated, and current
performance may be lower or higher than the performance data quoted. To
obtain performance as of the most recent month end, please visit
www.americanbeaconfunds.com or call 1-800-967-9009. Fund performance in the
table above does not reflect the deduction of taxes a shareholder would pay
on distributions or the redemption of shares.
(2.) Fund performance for the ten-year period represents the total returns
achieved by the Investor Class from 4/30/99 up to 5/1/03 and the returns of
the Advisor Class since its inception. Expenses of the Advisor Class are
higher than those of the Investor Class. As a result, total returns shown
may be higher than they would have been had the Advisor Class been in
existence since 4/30/99. A portion of the fees charged to the Advisor Class
of the Fund was waived through 2004. Performance prior to waiving fees was
lower than the actual returns shown for periods through 2004.
(3.) Russell 2000(R) Value Index is a registered trademark of Frank Russell
Company. The Russell 2000 Value Index is an unmanaged index of those stocks
in the Russell 2000 Index with lower price-to-book ratios and lower
forecasted growth values. The Lipper Small-Cap Value Funds Index tracks the
results of the 30 largest mutual funds in the Lipper Small-Cap Value Funds
category. Lipper is an independent mutual fund research and ranking
service. One cannot directly invest in an index.
(4.) The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, Advisor and AMR Class
shares was 0.82%, 1.19%, 1.32% and 0.57%, respectively. The expense ratios
above may vary from the expense ratios presented in other sections of this
report that are based on expenses incurred during the period covered by
this report.
The Fund outperformed the Index due to excess performance through both
stock selection and sector allocation.
Holdings in the Industrials, Consumer Discretionary, Energy, Health Care,
and Financials sectors added value relative to the Index. Top contributors in
the Industrials sector included Regal Beloit (up 26.0%) and Crane (up 45.0%).
Ameristar Casinos (up 122.8%), Rent-A-Center (up 31.8%), and Gentex (up 42.5%)
were a major source of excess performance in the Consumer Discretionary sector.
Companies with the greatest positive impact in the Energy sector included
Tidewater (up 0.6%), World Fuel Services (up 78.5%), and EXCO Resources (up
28.2%). Advanced Medical Optics (up 256.2%) and Amerigroup (up 19.5%)
contributed most to the Fund's Health Care sector returns. Odyssey Re Holdings
(up 18.0% for the period the Fund owned the security), PHH (up 108.2%), and
Fidelity National Title (up 105.3%) added the most value in the Financials
sector.
The Fund's significant underweighting in Financials, the second worst
performing sector in the Index, added value relative to the Index.
Overweightings in Information Technology and Consumer Discretionary, the two
best performing sectors in the Index, also added value. This positive impact was
somewhat offset by an overweighting in Energy, the worst performing sector in
the Index, which detracted value.
The sub-advisors continue to focus on uncovering investment opportunities
through stock selection that should benefit the Fund's performance over the
longer-term.
3
PERFORMANCE OVERVIEW
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
Hanover Insurance Group, Inc. .............. 0.9%
Tidewater, Inc. ............................ 0.9%
Ingram Micro, Inc. ......................... 0.9%
MAXIMUS, Inc. .............................. 0.8%
Regal-Beloit Corp. ......................... 0.8%
Portland General Electric Co. .............. 0.8%
Aspen Insurance Holdings Ltd. .............. 0.8%
Gentex Corp. ............................... 0.8%
Vishay Intertechnology, Inc. ............... 0.8%
Men's Wearhouse, Inc. ...................... 0.7%
SECTOR ALLOCATION
% OF
EQUITIES
----------
Industrials................................. 21.9%
Financials.................................. 21.3%
Information Technology...................... 17.4%
Consumer Discretionary...................... 16.0%
Health Care................................. 7.0%
Utilities................................... 5.6%
Energy...................................... 4.1%
Materials................................... 3.9%
Consumer Staples............................ 2.5%
Telecommunication Services.................. 0.3%
Investing in the securities of small-capitalization companies involves greater
risk and the possibility of greater price volatility than investing in larger
capitalization and more established companies.
4
FUND EXPENSES
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs and (2) ongoing costs, including management fees, administrative service
fees, distribution (12b-1) fees, and other Fund expenses. The examples below are
intended to help you understand the ongoing cost (in dollars) of investing in
the Fund and to compare these costs with the ongoing costs of investing in other
mutual funds.
The examples are based on an investment of $1,000 invested at the beginning
of the period in each Class and held for the entire period from November 1, 2008
through April 30, 2009.
ACTUAL EXPENSES
The "Actual" lines of the table provide information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading "Expenses Paid During Period" to estimate
the expenses you paid on your account during this period. Shareholders of the
Investor and Institutional Classes that invest in the Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" lines of the table provide information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed 5% per year rate of return before expenses (not the
Fund's actual return). You may compare the ongoing costs of investing in the
Fund with other funds by contrasting this 5% hypothetical example and the 5%
hypothetical examples that appear in the shareholder reports of the other funds.
The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. Shareholders
of the Investor and Institutional Classes that invest in the Fund through an IRA
may be subject to a custodial IRA fee of $12 that is typically deducted each
December. If your account was subject to a custodial IRA fee during the period,
your costs would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by the
Fund. Similarly, the expense examples for other funds do not reflect any
transaction costs charged by those funds, such as sales charges (loads),
redemption fees or exchange fees. Therefore, the "Hypothetical" lines of the
table are useful in comparing ongoing costs only and will not help you determine
the relative total costs of owning different funds. If you were subject to any
transaction costs during the period, your costs would have been higher.
Beginning Ending
Account Account Expenses Paid
Value Value During Period*
11/1/08 4/30/09 11/1/08-4/30/09
---------- --------- ---------------
INSTITUTIONAL CLASS
Actual $1,000.00 $ 967.32 $4.00
Hypothetical $1,000.00 $1,020.73 $4.11
(5% return before expenses)
INVESTOR CLASS
Actual $1,000.00 $ 966.63 $5.27
Hypothetical $1,000.00 $1,019.44 $5.41
(5% return before expenses)
ADVISOR CLASS
Actual $1,000.00 $ 964.97 $6.48
Hypothetical $1,000.00 $1,018.20 $6.66
(5% return before expenses)
AMR CLASS
Actual $1,000.00 $ 969.06 $2.78
Hypothetical $1,000.00 $1,021.97 $2.86
(5% return before expenses)
* Expenses are equal to the Fund's annualized expense ratios for the
six-month period of 0.82%, 1.08%, 1.33% and 0.57% for the Institutional,
Investor, Advisor and AMR Classes respectively, multiplied by the average
account value over the period, multiplied by the number derived by dividing
the number of days in the most recent fiscal half-year (181) by days in the
year (365) to reflect the half year period.
5
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
COMMON STOCKS - 94.31%
COMMUNICATIONS - 0.26%
MEDIA - 0.26%
AH Belo Corp. + .............................. 82,530 $ 157
Courier Corp. ................................ 84,799 1,330
Meredith Corp. + ............................. 109,190 2,738
Westwood One, Inc. ## ........................ 1,588,500 111
----------
TOTAL COMMUNICATIONS ............................ 4,336
----------
CONSUMER DISCRETIONARY - 15.12%
AUTO COMPONENTS - 1.24%
American Axle & Manufacturing Holdings,
Inc. + .................................... 1,015,600 1,016
ATC Technology Corp. ## ...................... 21,600 343
Autoliv, Inc. ................................ 30,930 763
BorgWarner, Inc. + ........................... 126,463 3,661
Gentex Corp. + ............................... 1,008,810 13,488
Lear Corp. ## ................................ 779,700 624
Superior Industries International, Inc. + .... 58,500 882
----------
20,777
----------
DISTRIBUTORS - 0.19%
WESCO International, Inc. ## ................. 122,300 3,180
----------
HOTELS, RESTAURANTS & LEISURE - 2.21%
Ameristar Casinos, Inc. ...................... 559,500 11,481
CKE Restaurants, Inc. ## ..................... 241,200 2,308
Cracker Barrel Old Country Store, Inc. + ..... 82,811 2,701
Domino's Pizza, Inc. ## ...................... 68,300 645
Jack in the Box, Inc. ## ..................... 206,400 5,075
JAKKS Pacific, Inc. ## ....................... 183,900 2,326
Lakes Entertainment, Inc. ## ................. 28,100 88
Panera Bread Co. ## + ........................ 70,060 3,924
PF Chang's China Bistro, Inc. ## + ........... 90,160 2,721
Pinnacle Entertainment, Inc. ## + ............ 248,000 3,095
Speedway Motorsports, Inc. + ................. 183,500 2,753
----------
37,117
----------
HOUSEHOLD DURABLES - 1.62%
Black & Decker Corp. ......................... 32,900 1,326
Cavco Industries, Inc. ## + .................. 58,820 1,379
Ethan Allen Interiors, Inc. + ................ 242,990 3,268
Knoll, Inc. .................................. 314,800 2,229
Lancaster Colony Corp. ....................... 36,287 1,589
M.D.C. Holdings, Inc. ........................ 123,190 4,211
Russ Berrie & Co., Inc. ## ................... 35,800 68
Ryland Group, Inc. + ......................... 203,590 4,216
Stanley Works ................................ 72,600 2,761
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Tempur-Pedic International, Inc. ............. 71,532 $ 920
Whirlpool Corp. + ............................ 115,100 5,198
----------
27,165
----------
INTERNET & CATALOG RETAIL - 0.32%
NutriSystem, Inc. + .......................... 184,300 2,532
School Specialty, Inc. ## + .................. 38,400 721
Systemax, Inc. ## + .......................... 125,400 2,114
----------
5,367
----------
LEISURE EQUIPMENT & PRODUCTS - 0.63%
Brunswick Corp. + ............................ 516,000 3,086
Callaway Golf Co. ............................ 244,500 1,846
Polaris Industries, Inc. + ................... 41,600 1,391
Scholastic Corp. + ........................... 143,800 2,837
Thor Industries, Inc. ........................ 58,460 1,344
----------
10,504
----------
MULTILINE RETAIL - 0.70%
Big Lots, Inc. ## ............................ 237,850 6,574
BJ's Wholesale Club, Inc. ## ................. 144,330 4,812
Dillards, Inc. ## ............................ 51,600 398
----------
11,784
----------
SPECIALTY RETAIL - 6.69%
Aaron Rents, Inc. + .......................... 183,500 6,158
Bebe Stores, Inc. + .......................... 241,890 2,225
Cabela's, Inc. ## + .......................... 786,300 10,073
Chico's FAS, Inc. ## + ....................... 271,770 2,076
Childrens Place Retail Stores, Inc. ## + ..... 109,400 3,111
Dick's Sporting Goods, Inc. ## + ............. 183,961 3,495
Family Dollar Stores, Inc. ................... 168,000 5,576
Finish Line, Inc., Class A Shares ............ 4,355 37
Foot Locker, Inc. ............................ 794,300 9,444
Group 1 Automotive, Inc. + ................... 183,150 3,901
Gymboree Corp. ## + .......................... 289,280 9,951
Interline Brands, Inc. ## .................... 16,200 210
J Crew Group, Inc. ## + ...................... 192,970 3,321
Jos. A. Bank Clothiers, Inc. ## + ............ 62,660 2,534
Limited Brands, Inc. ......................... 325,700 3,720
Lululemon Athletica, Inc. ## ................. 129,924 1,812
MarineMax, Inc. ## ........................... 303,400 1,381
Men's Wearhouse, Inc. + ...................... 667,400 12,440
OfficeMax, Inc. .............................. 600,873 4,477
Penske Auto Group, Inc. + .................... 132,700 1,758
Pep Boys, Inc. + ............................. 9,700 72
RadioShack Corp. ............................. 671,800 9,459
Rent-A-Center, Inc. ## ....................... 296,450 5,707
Stage Stores, Inc. ........................... 129,320 1,584
Tractor Supply Co. ## + ...................... 84,410 3,409
See accompanying notes
6
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Williams-Sonoma, Inc. + ...................... 301,894 $ 4,227
----------
112,158
----------
TEXTILES & APPAREL - 1.52%
Columbia Sportswear Co. + .................... 29,756 914
Jones Apparel Group, Inc. .................... 317,900 2,937
K-Swiss, Inc. ................................ 82,639 830
Phillips-Van Heusen Corp. .................... 140,700 4,085
Quiksilver, Inc. ## .......................... 1,948,600 3,215
Skechers U.S.A., Inc. ## + ................... 410,380 4,802
Timberland Co. ## ............................ 182,160 2,958
Volcom, Inc. ## + ............................ 59,700 805
Warnaco Group, Inc. ## ....................... 171,300 4,940
----------
25,486
----------
TOTAL CONSUMER DISCRETIONARY .................... 253,538
----------
CONSUMER STAPLES - 2.34%
FOOD & DRUG RETAILING - 1.39%
Casey's General Stores, Inc. ................. 166,183 4,422
Great Atlantic & Pacific Tea Co. ## .......... 5,300 39
Ingles Markets, Inc. ......................... 87,900 1,372
Ruddick Corp. ................................ 136,050 3,491
Spartan Stores, Inc. + ....................... 266,550 4,337
Whole Foods Market, Inc. + ................... 257,899 5,346
Winn-Dixie Stores, Inc. ## + ................. 373,500 4,281
----------
23,288
----------
FOOD PRODUCTS - 0.70%
Cal-Maine Foods, Inc. + ...................... 142,800 3,780
Corn Products International, Inc. ............ 28,000 669
Del Monte Foods Co. .......................... 173,200 1,308
Hain Celestial Group, Inc. ## + .............. 115,450 1,927
Herbalife Ltd. ............................... 43,400 860
Lance, Inc. + ................................ 41,037 950
Ralcorp Holdings, Inc. ## .................... 40,810 2,333
----------
11,827
----------
TOBACCO - 0.25%
Alliance One International, Inc. ## .......... 198,500 744
Universal Corp. .............................. 112,700 3,399
----------
4,143
----------
TOTAL CONSUMER STAPLES .......................... 39,258
----------
ENERGY - 3.90%
ENERGY EQUIPMENT & SERVICES - 2.55%
CARBO Ceramics, Inc. + ....................... 53,620 1,647
Dril-Quip, Inc. ## ........................... 114,720 3,944
Gulfmark Offshore, Inc. ## ................... 86,400 2,322
Helmerich & Payne, Inc. + .................... 35,900 1,106
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Lufkin Industries, Inc. ...................... 26,730 $ 933
NATCO Group, Inc. ## ......................... 92,890 2,235
Oil States International, Inc. ## ............ 235,800 4,457
Patterson-UTI Energy, Inc. ................... 127,750 1,624
SEACOR Holdings, Inc. ## + ................... 63,900 4,199
Tidewater, Inc. + ............................ 355,850 15,391
Unit Corp. ## + .............................. 182,485 4,980
----------
42,838
----------
OIL & GAS - 1.35%
Arena Resources, Inc. ## + ................... 172,890 4,957
Comstock Resources, Inc. ## .................. 56,110 1,934
Encore Acquisition Co. ## .................... 109,900 3,208
EXCO Resources, Inc. ## ...................... 505,900 5,959
Frontier Oil Corp. ........................... 138,180 1,756
Goodrich Petroleum Corp. ## + ................ 47,210 1,083
Holly Corp. + ................................ 174,450 3,656
----------
22,553
----------
TOTAL ENERGY .................................... 65,391
----------
FINANCIALS - 20.07%
BANKS - 5.05%
Associated Banc-Corp + ....................... 79,600 1,231
BancorpSouth, Inc. + ......................... 156,570 3,640
Cathay General Bancorp + ..................... 111,700 1,253
City National Corp. + ........................ 235,053 8,603
East West Bancorp, Inc. ...................... 310,800 2,123
F.N.B. Corp. + ............................... 159,192 1,197
Fifth Third Bancorp .......................... 343,400 1,408
First Horizon National Corp. + ............... 727,431 8,373
First Midwest Bancorp, Inc. + ................ 67,800 601
First Niagara Financial Group, Inc. + ........ 128,700 1,743
FirstMerit Corp. ............................. 267,020 5,183
Fulton Financial Corp. + ..................... 280,583 1,855
Hancock Holding Co. + ........................ 69,750 2,641
Home Federal Bancorp Inc. + .................. 171,000 1,725
International Bancshares Corp. ............... 2,800 38
Intervest Bancshares Corp. + ................. 58,400 229
MB Financial, Inc. + ......................... 71,400 973
National Penn Bancshares, Inc. + ............. 268,025 2,168
NewAlliance Bancshares, Inc. + ............... 633,298 8,176
Old National Bancorp + ....................... 120,887 1,648
Pacific Capital Bancorp NA + ................. 157,505 1,093
Provident Financial Services, Inc. ........... 312,900 3,339
Southwest Bancorp, Inc. ...................... 117,510 805
Susquehanna Bancshares, Inc. + ............... 271,800 2,191
Synovus Financial Corp. + .................... 301,240 973
See accompanying notes
7
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Trustmark Corp. + ............................ 79,020 $ 1,718
UCBH Holdings, Inc. + ........................ 142,100 182
Umpqua Holdings Corp. + ...................... 308,300 2,956
United Community Banks, Inc. + ............... 85,023 548
Washington Federal, Inc. + ................... 322,314 4,184
Washington Trust Bancorp, Inc. ............... 28,880 527
Webster Financial Corp. + .................... 758,500 3,967
WesBanco, Inc. + ............................. 33,400 664
Whitney Holding Corp. + ...................... 518,905 6,206
Wintrust Financial Corp. + ................... 27,800 473
----------
84,634
----------
DIVERSIFIED FINANCIALS - 3.77%
AmeriCredit Corp. ## ......................... 31,100 316
Cash America International, Inc. ............. 90,838 2,031
Credit Acceptance Corp. ## + ................. 160,000 3,678
Ezcorp, Inc. ## .............................. 357,050 4,424
Financial Federal Corp. + .................... 166,910 4,108
First Cash Financial Services, Inc. ## + ..... 200,300 3,293
Investment Technology Group, Inc. ## ......... 421,185 9,595
Jefferies Group, Inc. + ...................... 253,460 4,960
Knight Capital Group, Inc. ## ................ 191,450 2,965
Lazard Ltd. .................................. 158,112 4,316
Legg Mason, Inc. + ........................... 298,900 5,999
MF Global Ltd. ## ............................ 67,000 409
Nelnet, Inc. ................................. 184,700 1,114
Piper Jaffray Co. ## ......................... 263,533 9,137
Raymond James Financial, Inc. + .............. 48,120 755
World Acceptance Corp. ## + .................. 205,800 6,108
----------
63,208
----------
INSURANCE - 9.10%
Allied World Assurance Co. Holdings Ltd. ..... 83,700 3,109
American Equity Investment Life Holding
Co. + ..................................... 209,900 1,182
American Financial Group, Inc. ............... 351,000 6,170
American National Insurance Co. .............. 23,800 1,615
AmTrust Financial Services, Inc. + ........... 240,100 2,192
Argo Group International Holdings Ltd. ## .... 210,657 5,896
Aspen Insurance Holdings Ltd. ................ 573,680 13,527
CNA Surety Corp. ## .......................... 239,200 4,605
Conseco, Inc. ## ............................. 480,000 768
Delphi Financial Group, Inc. ................. 336,800 5,816
Employers Holdings, Inc. ..................... 537,400 4,482
Endurance Specialty Holdings Ltd. + .......... 125,600 3,286
Fidelity National Financial, Inc. ............ 139,633 2,531
First American Corp. ......................... 149,320 4,193
Flagstone Reinsurance Holdings Ltd. .......... 225,500 2,088
Hanover Insurance Group, Inc. ................ 515,970 15,469
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
HCC Insurance Holdings, Inc. ................. 230,170 $ 5,506
Horace Mann Educators Corp. .................. 56,800 499
Infinity Property and Casualty Corp. ......... 50,698 1,787
IPC Holdings Ltd. ............................ 115,600 3,010
Max Capital Group Ltd. ....................... 81,800 1,354
Montpelier Re Holdings Ltd. + ................ 65,108 811
National Western Life Insurance Co. .......... 2,100 239
Navigators Group, Inc. ## .................... 137,600 6,244
Old Republic International Corp. ............. 261,400 2,449
OneBeacon Insurance Group Ltd. ............... 19,500 227
Platinum Underwriters Holdings Ltd. .......... 95,900 2,759
PMA Capital Corp. ## ......................... 231,200 867
Presidential Life Corp. ...................... 108,700 1,162
ProAssurance Corp. ## ........................ 70,440 3,095
Reinsurance Group of America, Inc. ........... 265,900 8,453
Safety Insurance Group, Inc. ................. 59,700 1,973
Selective Insurance Group, Inc. .............. 22,900 338
StanCorp Financial Group, Inc. ............... 342,250 9,388
Stewart Information Services Corp. + ......... 276,600 6,254
Torchmark Corp. + ............................ 185,700 5,447
Tower Group, Inc. ............................ 21,400 582
United America Indemnity Ltd. ## ............. 1,161,065 5,887
United Fire & Casualty, Co. .................. 75,500 1,410
Unitrin, Inc. ................................ 51,400 874
Universal American Corp. ## .................. 415,100 4,288
Zenith National Insurance Corp. .............. 33,400 761
----------
152,593
----------
REAL ESTATE - 2.15%
Acadia Realty Trust .......................... 87,703 1,272
Alexandria Real Estate Equities, Inc. + ...... 47,590 1,736
BioMed Realty Trust, Inc. .................... 332,560 3,794
CAPLEASE, Inc. + ............................. 943,100 2,801
Cohen & Steers, Inc. + ....................... 184,718 2,719
DiamondRock Hospitality Co. + ................ 562,640 3,652
Douglas Emmett, Inc. + ....................... 217,280 2,079
EastGroup Properties, Inc. ................... 59,620 2,004
Entertainment Properties Trust + ............. 64,050 1,480
Essex Property Trust, Inc. ................... 12,160 778
Hilltop Holdings, Inc. ## + .................. 50,300 570
LaSalle Hotel Properties + ................... 293,380 3,509
MI Developments, Inc. ........................ 425,100 3,048
Mission West Properties, Inc. ................ 131,830 898
Redwood Trust, Inc. .......................... 149,595 2,434
Urstadt Biddle Properties, Inc. .............. 32,120 493
U-Store-It Trust ............................. 567,000 1,945
See accompanying notes
8
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
WP Carey & Co. LLC + ......................... 39,650 $ 843
----------
36,055
----------
TOTAL FINANCIALS ................................ 336,490
----------
HEALTH CARE - 6.59%
BIOTECHNOLOGY - 0.05%
Viropharma, Inc. ## + ........................ 149,000 839
----------
HEALTH CARE EQUIPMENT & SUPPLIES - 0.42%
IMS Health, Inc. ............................. 196,000 2,462
Kensey Nash Corp. ## ......................... 105,450 2,208
Kinetic Concepts, Inc. ## + .................. 93,100 2,305
----------
6,975
----------
HEALTH CARE PROVIDERS & SERVICES - 4.11%
Air Methods Corp. ## + ....................... 131,820 3,500
AMERIGROUP Corp. ## + ........................ 246,550 7,364
Amsurg Corp. ## .............................. 94,180 1,935
Health Net, Inc. ## .......................... 19,200 277
Healthspring, Inc. ## ........................ 688,160 6,352
IPC The Hospitalist Co., Inc. ## ............. 53,143 974
Kindred Healthcare, Inc. ## .................. 95,000 1,237
LifePoint Hospitals, Inc. ## + ............... 432,240 11,173
Lincare Holdings, Inc. ## + .................. 331,000 7,987
Magellan Health Services, Inc. ## ............ 112,480 3,325
MAXIMUS, Inc. ................................ 350,425 14,133
Mednax, Inc. ## .............................. 54,880 1,970
Molina Healthcare, Inc. ## + ................. 39,300 851
Odyssey HealthCare, Inc. ## .................. 192,860 1,998
RehabCare Group, Inc. ## ..................... 75,970 1,269
Res-Care, Inc. ## ............................ 281,350 4,507
----------
68,852
----------
PHARMACEUTICALS - 2.01%
Endo Pharmaceuticals Holdings, Inc. ## ....... 189,450 3,134
King Pharmaceuticals, Inc. ## ................ 1,124,900 8,864
Medicis Pharmaceutical Corp. ................. 317,200 5,097
NBTY, Inc. ## ................................ 407,650 10,562
Perrigo Co. + ................................ 137,500 3,564
Sepracor, Inc. ## ............................ 179,655 2,553
----------
33,774
----------
TOTAL HEALTH CARE ............................... 110,440
----------
INDUSTRIALS - 20.60%
AEROSPACE & DEFENSE - 1.68%
AAR Corp. ## + ............................... 130,800 1,971
BE Aerospace, Inc. ## ........................ 281,240 3,035
Ceradyne, Inc. ## ............................ 137,600 2,372
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Curtiss-Wright Corp. ......................... 133,190 $ 4,258
Esterline Technologies Corp. ## .............. 122,650 3,232
Moog, Inc. ## ................................ 108,250 2,899
Triumph Group, Inc. .......................... 212,000 8,762
World Fuel Services Corp. + .................. 44,900 1,712
----------
28,241
----------
BUILDING PRODUCTS - 2.22%
Apogee Enterprises, Inc. + ................... 314,900 4,220
Armstrong World Industries, Inc. ## .......... 185,300 3,369
Crane Co. .................................... 272,850 6,300
Drew Industries, Inc. ## + ................... 217,990 3,113
Griffon Corp. ## ............................. 102,651 890
Insituform Technologies, Inc. ## + ........... 400,100 6,133
Lennox International, Inc. + ................. 116,300 3,709
Simpson Manufacturing Co., Inc. + ............ 356,455 7,935
Universal Forest Products, Inc. + ............ 44,292 1,486
----------
37,155
----------
COMMERCIAL SERVICES & SUPPLIES - 5.26%
Administaff, Inc. ............................ 212,800 5,673
American Ecology Corp. ....................... 95,790 1,582
Bowne & Co., Inc. ............................ 29,955 153
Brink's Co. .................................. 116,390 3,300
Brink's Home Security Holdings, Inc. ## ...... 122,910 3,267
Clean Harbors, Inc. ## ....................... 51,048 2,558
Convergys Corp. ## ........................... 218,200 2,206
Con-way, Inc. ................................ 336,000 8,326
CSG Systems International, Inc. ## ........... 109,800 1,592
Deluxe Corp. ................................. 114,000 1,653
Dollar Financial Corp. ## .................... 16,600 168
Ennis, Inc. .................................. 94,700 852
G&K Services, Inc. ........................... 37,820 944
Heidrick & Struggles International, Inc. + ... 165,500 2,797
Herman Miller, Inc. .......................... 210,700 3,133
Hudson Highland Group, Inc. ## ............... 511,600 839
Kelly Services, Inc. ......................... 149,600 1,700
Korn/Ferry International ## .................. 859,160 9,099
Layne Christensen Co. ## ..................... 69,400 1,503
Manpower, Inc. ............................... 86,400 3,723
McGrath Rentcorp ............................. 110,088 2,327
PHH Corp. ## + ............................... 374,400 6,282
Pre-Paid Legal Services, Inc. ## + ........... 62,370 2,297
Spherion Corp. ## ............................ 785,100 2,819
Team, Inc. ## ................................ 80,520 1,157
TrueBlue, Inc. ## ............................ 162,300 1,576
United Stationers, Inc. ## ................... 126,300 4,134
Valassis Communications, Inc. ## ............. 1,824,300 9,432
See accompanying notes
9
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Waste Connections, Inc. ## ................... 120,770 $ 3,113
----------
88,205
----------
CONSTRUCTION & ENGINEERING - 1.38%
EMCOR Group, Inc. ## ......................... 462,500 9,615
Granite Construction, Inc. + ................. 98,510 3,886
Perini Corp. ## + ............................ 372,000 6,436
Shaw Group, Inc. ## .......................... 97,437 3,267
----------
23,204
----------
DIVERSIFIED MANUFACTURING - 1.08%
Acuity Brands, Inc. + ........................ 99,194 2,851
Andersons, Inc. + ............................ 23,700 381
Barnes Group, Inc. + ......................... 317,200 4,491
Kennametal, Inc. ............................. 508,100 10,391
----------
18,114
----------
ELECTRICAL EQUIPMENT - 1.89%
A.O. Smith Corp. ............................. 72,300 2,248
Airvana, Inc. ## + ........................... 157,790 898
Anixter International, Inc. ## + ............. 180,859 7,195
Baldor Electric Co. + ........................ 42,100 977
Belden, Inc. ................................. 40,900 659
Encore Wire Corp. + .......................... 38,870 849
Hubbell, Inc. ................................ 157,300 5,222
Regal-Beloit Corp. + ......................... 336,600 13,676
----------
31,724
----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.77%
Diebold, Inc. ................................ 354,300 9,364
PerkinElmer, Inc. ............................ 246,900 3,597
----------
12,961
----------
INDUSTRIAL CONGLOMERATES - 0.43%
Carlisle Cos., Inc. .......................... 313,350 7,129
----------
MACHINERY - 4.41%
AGCO Corp. ## ................................ 63,630 1,546
Applied Industrial Technologies, Inc. + ...... 286,300 6,442
Astec Industries, Inc. ## + .................. 81,970 2,526
Brady Corp. .................................. 116,000 2,444
CIRCOR International, Inc. ................... 27,700 713
Flowserve Corp. .............................. 113,300 7,693
Gardner Denver, Inc. ## ...................... 242,800 6,463
Harsco Corp. ................................. 281,800 7,764
Kaydon Corp. + ............................... 81,167 2,594
Lincoln Electric Holdings, Inc. + ............ 39,400 1,755
Middleby Corp. ## ............................ 16,800 735
Miller Industries, Inc. ## ................... 231,100 1,849
Mueller Industries, Inc. ..................... 177,910 3,909
NACCO Industries, Inc. ....................... 6,390 244
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Oshkosh Corp. ................................ 773,800 $ 7,429
RSC Holdings, Inc. ## + ...................... 529,800 3,788
Terex Corp. ## + ............................. 416,300 5,745
Timken Co. ................................... 473,350 7,611
Watts Water Technologies, Inc. + ............. 117,900 2,624
----------
73,874
----------
MARINE - 0.60%
Cal Dive International, Inc. ## .............. 306,000 2,424
Genco Shipping & Trading Ltd. + .............. 220,700 4,215
Kirby Corp. ## ............................... 113,100 3,490
----------
10,129
----------
ROAD & RAIL - 0.88%
Arkansas Best Corp. + ........................ 36,000 831
Bristow Group, Inc. ## + ..................... 16,000 364
GATX Corp. + ................................. 193,400 5,823
Heartland Express, Inc. + .................... 225,430 3,370
Landstar System, Inc. ........................ 80,410 2,864
Marten Transport Ltd. ## ..................... 70,070 1,453
----------
14,705
----------
TOTAL INDUSTRIALS ............................... 345,441
----------
INFORMATION TECHNOLOGY - 16.43%
COMMUNICATIONS EQUIPMENT - 1.51%
Adaptec, Inc. ## ............................. 158,500 453
Arris Group, Inc. ## ......................... 269,360 2,874
Avocent Corp. ## + ........................... 211,650 3,056
Black Box Corp. .............................. 120,300 3,293
Ciena Corp. ## + ............................. 272,840 3,260
Comtech Telecommunications Corp. ## .......... 70,630 2,364
F5 Networks, Inc. ## ......................... 115,220 3,142
Harmonic, Inc. ## ............................ 231,880 1,700
Sonus Networks, Inc. ## ...................... 977,677 1,691
Sycamore Networks, Inc. ## ................... 1,195,500 3,527
----------
25,360
----------
COMPUTERS & PERIPHERALS - 2.05%
Cray, Inc. ## ................................ 167,520 704
Electronics for Imaging, Inc. ## ............. 547,106 5,373
Imation Corp. + .............................. 251,700 2,517
Ingram Micro, Inc. ## ........................ 996,700 14,472
Lexmark International, Inc. ## ............... 337,500 6,622
Mercury Computer Systems, Inc. ## ............ 355,200 2,884
Teradata Corp. ## ............................ 103,800 1,735
----------
34,307
----------
ELECTRONIC COMPONENTS - 0.96%
II-VI, Inc. ## ............................... 73,320 1,757
Plexus Corp. ## .............................. 540,100 11,963
See accompanying notes
10
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Thomas & Betts Corp. ## ...................... 79,100 $ 2,462
----------
16,182
----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 3.12%
Analogic Corp. ............................... 63,720 2,319
Arrow Electronics, Inc. ## ................... 358,000 8,141
AVX Corp. + .................................. 280,400 2,807
Benchmark Electronics, Inc. ## ............... 599,150 7,268
Coherent, Inc. ## ............................ 9,700 184
Jabil Circuit, Inc. .......................... 352,300 2,854
Littelfuse, Inc. ## .......................... 421,200 6,904
Methode Electronics, Inc. .................... 955,383 5,751
MTS Systems Corp. ............................ 117,000 2,472
Multi-Fineline Electronix, Inc. ## ........... 31,300 628
Vishay Intertechnology, Inc. ## .............. 2,211,710 12,983
----------
52,311
----------
INTERNET SOFTWARE & SERVICES - 1.06%
DealerTrack Holdings, Inc. ## ................ 199,599 3,030
EarthLink, Inc. ## + ......................... 491,100 3,723
InterActiveCorp ## ........................... 457,600 7,331
NIC, Inc. .................................... 270,710 1,462
United Online, Inc. .......................... 271,380 1,438
Websense, Inc. ## ............................ 45,960 819
----------
17,803
----------
IT CONSULTING & SERVICES - 2.47%
CACI International, Inc. ## .................. 139,000 5,498
Ciber, Inc. ## ............................... 71,700 232
First Advantage Corp. ## ..................... 141,132 2,024
ManTech International Corp. ## ............... 72,450 2,622
MPS Group, Inc. ## ........................... 633,600 5,094
Ness Technologies, Inc. ## ................... 395,100 1,458
Patni Computer Systems Ltd., ADR ............. 450,300 3,512
SRA International, Inc. ## ................... 218,720 3,366
SYNNEX Corp. ## + ............................ 171,900 3,701
Syntel, Inc. + ............................... 150,550 4,173
Tech Data Corp. ## ........................... 336,030 9,674
Unisys Corp. ## .............................. 51,500 63
----------
41,417
----------
SEMICONDUCTOR EQUIPMENT & PRODUCTS - 2.99%
Brooks Automation, Inc. ## ................... 1,340,900 8,340
Cabot Microelectronics Corp. ## .............. 101,900 2,936
Cirrus Logic, Inc. ## ........................ 266,660 1,240
Cymer, Inc. ## ............................... 105,540 2,998
FEI Co. ## ................................... 176,950 3,040
Formfactor, Inc. ## + ........................ 181,670 3,167
Integrated Device Technology, Inc. ## ........ 805,000 4,371
International Rectifier Corp. ## ............. 53,000 895
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
MKS Instruments, Inc. ## ..................... 370,490 $ 5,798
National Semiconductor Corp. ................. 64,200 794
ON Semiconductor Corp. ## .................... 1,513,300 8,202
Semtech Corp. ## ............................. 173,550 2,503
Teradyne, Inc. ## ............................ 409,790 2,434
TriQuint Semiconductor, Inc. ## .............. 832,650 3,189
Ultra Clean Holdings ## ...................... 131,750 240
----------
50,147
----------
SOFTWARE - 2.27%
Aspen Technology, Inc. ## + .................. 217,080 1,684
DST Systems, Inc. ## + ....................... 24,200 875
EPIQ Systems, Inc. ## + ...................... 190,603 2,949
infoGROUP, Inc. .............................. 302,200 1,224
Informatica Corp. ## ......................... 217,830 3,463
JDA Software Group, Inc. ## .................. 386,300 5,451
Lawson Software, Inc. ## + ................... 1,060,200 5,714
Manhattan Associates, Inc. ## + .............. 147,400 2,450
Mentor Graphics Corp. ## ..................... 1,108,000 7,446
Micros Systems, Inc. ## ...................... 37,360 784
Novell, Inc. ## .............................. 616,400 2,318
Omnicell, Inc. ## + .......................... 41,031 361
STEC, Inc. ## + .............................. 181,750 1,745
TIBCO Software, Inc. ## ...................... 244,200 1,543
----------
38,007
----------
TOTAL INFORMATION TECHNOLOGY .................... 275,534
----------
MATERIALS - 3.68%
CHEMICALS - 1.72%
Eastman Chemical Co. ......................... 121,300 4,813
H.B. Fuller Co. .............................. 43,280 764
NewMarket Corp. .............................. 24,100 1,518
Olin Corp. ................................... 415,700 5,238
OM Group, Inc. ## ............................ 17,100 476
PolyOne Corp. ## ............................. 1,617,500 4,432
RPM International, Inc. ...................... 564,300 7,799
Westlake Chemical Corp. + .................... 204,300 3,821
----------
28,861
----------
CONTAINERS & PACKAGING - 0.68%
Greif, Inc. .................................. 76,300 3,454
Jarden Corp. ## .............................. 141,200 2,838
Packaging Corp. of America ................... 281,090 4,461
Sonoco Products Co. .......................... 28,000 683
----------
11,436
----------
METALS & MINING - 1.18%
AMCOL International Corp. + .................. 71,710 1,390
Carpenter Technology Corp. ................... 336,600 6,957
See accompanying notes
11
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Foundation Coal Holdings, Inc. + ............. 93,700 $ 1,522
Gibraltar Industries, Inc. + ................. 22,700 152
Schnitzer Steel Industries, Inc. + ........... 14,400 714
Universal Stainless & Alloy ## ............... 15,500 208
USEC, Inc. ## + .............................. 570,400 3,531
Worthington Industries, Inc. + ............... 355,800 5,301
----------
19,775
----------
PAPER & FOREST PRODUCTS - 0.10%
Wausau Paper Corp. ........................... 188,750 1,648
----------
TOTAL MATERIALS ................................. 61,720
----------
TELECOMMUNICATION SERVICES - 0.05%
DIVERSIFIED TELECOMMUNICATION - 0.05%
Cincinnati Bell, Inc. ## ..................... 289,800 808
----------
UTILITIES - 5.27%
ELECTRIC UTILITIES - 4.15%
Avista Corp. ................................. 111,700 1,681
Black Hills Corp. ............................ 115,000 2,286
El Paso Electric Co. ## ...................... 258,030 3,561
Great Plains Energy, Inc. .................... 797,800 11,544
IDACORP, Inc. ................................ 286,090 6,857
OGE Energy Corp. ............................. 362,800 9,328
Pinnacle West Capital Corp. .................. 228,600 6,259
PNM Resources, Inc. .......................... 464,500 3,957
Portland General Electric Co. ................ 742,400 13,564
Westar Energy, Inc. .......................... 598,800 10,497
----------
69,534
----------
GAS UTILITIES - 0.87%
Atmos Energy Corp. ........................... 257,500 6,363
Energen Corp. ................................ 126,592 4,572
Integrys Energy Group, Inc. + ................ 28,700 758
Nicor, Inc. .................................. 79,450 2,554
Southwest Gas Corp. .......................... 19,100 386
----------
14,633
----------
MULTI-UTILITIES - 0.25%
NV Energy, Inc. .............................. 402,700 4,128
----------
TOTAL UTILITIES ................................. 88,295
----------
TOTAL COMMON STOCKS ............................. 1,581,251
----------
SHORT TERM INVESTMENTS - 5.58%
American Beacon U.S. Government Money
Market Select Fund +++ .................... 20,000,000 20,000
Columbia Government Reserve Fund ............. 64,081,321 64,081
PAR
AMOUNT VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
U.S. Treasury,
0.08%, Due 6/11/2009 # .................... $ 9,559 $ 9,557
----------
TOTAL SHORT TERM INVESTMENTS .................... 93,638
----------
SHARES
------------
SECURITIES LENDING COLLATERAL - 18.20%
American Beacon U.S. Government Money
Market Select Fund +++ .................... 65,496,409 65,496
State Street Navigator Securities Lending
Prime Portfolio ........................... 239,590,498 239,591
----------
TOTAL SECURITIES LENDING COLLATERAL ............. 305,087
----------
TOTAL INVESTMENTS 118.09% - (COST $2,288,738) ...... 1,979,976
LIABILITIES, NET OF OTHER ASSETS - (18.09%) ........ (303,281)
----------
TOTAL NET ASSETS - 100.00% ......................... $1,676,695
==========
See accompanying notes
12
AMERICAN BEACON SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
+++ The Fund is affiliated by having the same investment advisor.
# At April 30, 2009, security pledged as collateral for open futures
contracts.
FUTURES CONTRACTS
(DOLLARS IN THOUSANDS)
UNREALIZED
NUMBER OF EXPIRATION MARKET APPRECIATION/
CONTRACTS DATE VALUE (DEPRECIATION)
--------- ---------- ------- --------------
Emini Mini Russell ...... 1,916 Jun 2009 $93,252 $15,899
======= =======
See accompanying notes
13
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2009 (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
ASSETS:
Investments in unaffiliated securities, at value(A, C) ........ $ 1,894,480
Investments in affiliated securities, at value(B) ............. 85,496
Receivable for investments sold ............................... 11,138
Dividends and interest receivable ............................. 868
Receivable for fund shares sold ............................... 7,056
Receivable for tax reclaims ................................... 2
Prepaid expenses............................................... 62
-----------
TOTAL ASSETS ............................................... 1,999,102
-----------
LIABILITIES:
Payable for investments purchased ............................. 13,342
Payable upon return of securities loaned ...................... 305,087
Payable for fund shares redeemed............................... 654
Payable for variation margin on open futures contracts......... 403
Management and investment advisory fees payable (Note 2)....... 2,084
Administrative service and service fees payable ............... 511
Other liabilities ............................................. 326
-----------
TOTAL LIABILITIES .......................................... 322,407
-----------
NET ASSETS ....................................................... $ 1,676,695
===========
ANALYSIS OF NET ASSETS:
Paid-in-capital................................................ 2,603,472
Undistributed net investment income............................ 6,773
Accumulated net realized loss ................................. (640,687)
Unrealized depreciation of investments,
futures contracts, and foreign currency .................... (292,863)
-----------
NET ASSETS ....................................................... $ 1,676,695
===========
SHARES OUTSTANDING (NO PAR VALUE):
Institutional Class ........................................... 66,958,114
===========
Investor Class................................................. 56,663,274
===========
Advisor Class.................................................. 2,285,409
===========
AMR Class...................................................... 16,374,532
===========
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE:
Institutional Class ........................................... $ 11.90
===========
Investor Class................................................. $ 11.64
===========
Advisor Class ................................................. $ 11.58
===========
AMR Class...................................................... $ 11.83
===========
A Cost of investments in unaffiliated securities ................. $ 2,203,242
B Cost of investments in affiliated securities.................... $ 85,496
C Market value of securities on loan ............................. $ 296,615
See accompanying notes
14
AMERICAN BEACON SMALL CAP VALUE FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 2009 (UNAUDITED) (IN THOUSANDS)
INVESTMENT INCOME:
Dividend income from unaffiliated securities
(net of foreign taxes)* ..................................... $ 14,335
Dividend income from affiliated securities ..................... 143
Interest income................................................. 37
Income derived from securities lending, net .................... 2,757
---------
TOTAL INVESTMENT INCOME ..................................... 17,272
---------
EXPENSES:
Management and investment advisory fees (Note 2) ............... 3,419
Administrative service fees (Note 2):
Institutional Class.......................................... 1,077
Investor Class............................................... 881
Advisor Class................................................ 40
AMR Class.................................................... 43
Transfer agent fees:
Institutional Class.......................................... 28
Investor Class............................................... 25
Advisor Class................................................ 2
AMR Class.................................................... 4
Custody and fund accounting fees................................ 111
Professional fees .............................................. 38
Registration fees and expenses ................................. 27
Service fees:
Investor Class (Note 2)...................................... 759
Advisor Class (Note 2)....................................... 33
Distribution fees - Advisor Class (Note 2) ..................... 33
Prospectus and shareholder reports.............................. 180
Trustee fees.................................................... 54
Other expenses.................................................. 78
---------
TOTAL EXPENSES .............................................. 6,832
---------
NET INVESTMENT INCOME.............................................. 10,440
---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from:
Investments (311,253)
Commission recapture (Note 1)................................ 190
Futures contracts............................................ (49,415)
Change in net unrealized appreciation or depreciation of:
Investments.................................................. 232,270
Futures contracts............................................ 49,813
---------
NET LOSS ON INVESTMENTS...................................... (78,395)
---------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS............... $ (67,955)
=========
* Foreign taxes................................................ $ 21
See accompanying notes
15
AMERICAN BEACON SMALL CAP VALUE FUND
STATEMENT OF CHANGES OF NET ASSETS (IN THOUSANDS)
Six Months
Ended Year Ended
April 30, October 31,
2009 2008
----------- -----------
(unaudited)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ......................................... $ 10,440 $ 32,606
Net realized loss on investments, futures
contracts, and foreign currency transactions ............... (360,478) (266,287)
Change in net unrealized appreciation or
(depreciation) of investments, futures
contracts, and foreign currency translations ............... 282,083 (785,333)
---------- -----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS .... (67,955) (1,019,014)
---------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Institutional Class......................................... (13,600) (13,291)
Investor Class.............................................. (8,841) (9,332)
Advisor Class............................................... (311) (298)
AMR Class................................................... (3,927) (4,903)
Net realized gain on investments:
Institutional Class......................................... -- (152,714)
Investor Class.............................................. -- (145,952)
Advisor Class............................................... -- (7,763)
AMR Class................................................... -- (43,605)
---------- -----------
NET DISTRIBUTIONS TO SHAREHOLDERS ....................... (26,679) (377,858)
---------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from sales of shares ................................. 239,568 463,771
Reinvestment of dividends and distributions.................... 26,349 371,165
Cost of shares redeemed ....................................... (263,896) (879,196)
---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS 2,021 (44,260)
---------- -----------
NET (DECREASE) IN NET ASSETS (92,613) (1,441,132)
---------- -----------
NET ASSETS:
Beginning of period ........................................... 1,769,308 3,210,440
---------- -----------
END OF PERIOD *................................................ $1,676,695 $ 1,769,308
========== ===========
*Includes undistributed net investment income of ................. $ 6,773 $ 23,220
========== ===========
See accompanying notes
16
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
American Beacon Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, (the "Act") as a diversified, open-end management investment company.
These financial statements and notes to the financial statements relate to the
American Beacon Small Cap Value Fund (the "Fund"), a series of the Trust.
American Beacon Advisors, Inc. (the "Manager") is a wholly-owned
subsidiary of Lighthouse Holdings, Inc. and was organized in 1986 to provide
business management, advisory, administrative and asset management consulting
services to the Trust and other investors.
Class Disclosure
Prior to March 1, 2009, the Investor and Advisor Classes were known as
the PlanAhead and Service Classes, respectively.
The Fund has multiple classes of shares designed to meet the needs of
different groups of investors. The following table sets forth the differences
amongst the classes:
CLASS: OFFERED TO:
- ------ -----------
INSTITUTIONAL CLASS Investors making an initial investment of $2 million
INVESTOR CLASS General public and investors investing through an intermediary
ADVISOR CLASS Investors investing through an intermediary
AMR CLASS Investors in the tax-exempt retirement and benefit plans of AMR
Corporation and its affiliates
Administrative service fees, service fees and distribution fees vary
amongst the classes as described more fully in footnote 2.
Investment income, net capital gains (losses) and all expenses
incurred by the Fund are allocated based on the relative net assets of each
class, except for service fees and certain other fees and expenses related
solely to one class of shares.
Security Valuation
Investments are valued at the close of the New York Stock Exchange
(the "Exchange"), normally 4 p.m. ET, each day that the Exchange is open for
business. Equity securities for which market quotations are available are valued
at the last sale price or official closing price (closing bid price or last
evaluated quote if no sale has occurred) on the primary market or exchange on
which they trade.
Debt securities (other than short-term securities) normally are valued
on the basis of prices provided by an independent pricing service and may take
into account appropriate factors such as institution-size trading in similar
groups of securities, yield, quality, coupon rate, maturity, type of issue,
trading characteristics and other market data. Securities for which market
prices are not readily available or are not reflective of the fair value of the
security, as determined by the Manager, will be priced at fair value following
procedures approved by the Board of Trustees (the "Board").
Investments in mutual funds are valued at the closing net asset value
per share of the mutual fund on the day of valuation. Investment grade
short-term obligations with 60 days or less to maturity are valued using the
amortized cost method, which approximates market value.
The Fund adopted the provisions of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective with the
beginning of the Fund's fiscal year. The standard clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires
17
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
additional disclosures about the use of fair value measurements. The three
levels of the hierarchy under FAS 157 are described below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Prices determined using other significant observable inputs.
These may include quoted prices for similar securities, interest
rates, prepayment speeds, credit risk, and others.
Level 3 - Prices determined using other significant unobservable
inputs. Unobservable inputs reflect the Fund's own assumptions about
the factors market participants would use in pricing an investment,
and would be based on the best information available.
A summary of the inputs used to value the Fund's investments as of April 30,
2009 is as follows (in thousands):
Investments in Other Financial
Valuation Inputs Securities Instruments*
---------------- -------------- ---------------
Level 1 - Quoted prices .......................... $1,970,419 $15,899
Level 2 - Other significant observable inputs .... 9,557 --
Level 3 - Significant unobservable inputs ....... -- --
---------- -------
Total ............................................ $1,979,976 $15,899
---------- -------
* Other financial instruments are futures.
Security Transactions and Investment Income
Security transactions are recorded on the trade date of the security
purchase or sale. The Fund may purchase securities with delivery or payment to
occur at a later date. At the time the Fund enters into a commitment to purchase
a security, the transaction is recorded, and the value of the security is
reflected in the net asset value. The value of the security may vary with market
fluctuations.
Dividend income, net of foreign taxes, is recorded on the ex-dividend
date. Interest income is earned from settlement date, recorded on the accrual
basis, and adjusted, if necessary, for accretion of discounts and amortization
of premiums. For financial and tax reporting purposes, realized gains and losses
are determined on the basis of specific lot identification.
Futures Contracts
Futures contracts are contracts to buy or sell a standard quantity of
securities at a specified price on a future date. The Fund may enter into
financial futures contracts as a method for keeping assets readily convertible
to cash if needed to meet shareholder redemptions or for other needs while
maintaining exposure to the stock or bond market, as applicable. The primary
risks associated with the use of futures contracts are the possibility of
illiquid markets or imperfect correlation between the values of the contracts
and the underlying securities, or that the counterparty will fail to perform its
obligations.
Upon entering into a futures contract, the Fund is required to set
aside or deposit with a broker an amount, termed the initial margin, which
typically represents 5% of the face value of the futures contract. The Fund
reflects this amount on the Schedule of Investments as a U.S. Treasury Bill held
as collateral for futures contracts. Payments to and from the broker, known as
variation margin, are required to be made on a daily basis as the price of the
futures contract fluctuates. Changes in initial settlement values are accounted
for as unrealized appreciation (depreciation) until the contracts are
terminated, at which time realized gains and losses are recognized. Futures
contracts are valued at the most recent settlement price established each day by
the exchange on which they are traded.
18
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Dividends to Shareholders
Dividends from net investment income of the Fund normally will be
declared and paid at least annually. Distributions, if any, of net realized
capital gains are generally paid at least annually and recorded on the
ex-dividend date.
Commission Recapture
The Fund has established brokerage commission recapture arrangements
with certain brokers or dealers. If the Fund's investment advisor chooses to
execute a transaction through a participating broker, the broker rebates a
portion of the commission back to the Fund. Any collateral benefit received
through participation in the commission recapture program is directed
exclusively to the Fund. This amount is reported with the net realized gain in
the Fund's Statement of Operations.
Allocation of Income, Expenses, Gains and Losses
Income, expenses (other than those attributable to a specific class),
gains and losses are allocated daily to each class of shares based upon the
relative proportion of net assets represented by such class. Operating expenses
directly attributable to a specific class are charged against the operations of
that class.
Use of Estimates
The preparation of financial statements in conformity with U.S.
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimated.
Recently Issued Accounting Pronouncements
In March 2008, FASB issued Statement of Financial Accounting Standards
No. 161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"), which is effective for fiscal years and interim periods beginning after
November 15, 2008. FAS 161 requires enhanced disclosures about derivative and
hedging activities, including how such activities are accounted for and their
effect on financial positions, performance and cash flows. The Manager is
currently evaluating the impact the adoption of FAS 161 will have on the Fund's
financial statements and related disclosures.
Other
Under the Trust's organizational documents, its officers and directors
are indemnified against certain liability arising out of the performance of
their duties to the Trust. In the normal course of business, the Trust enters
into contracts that provide indemnification to the other party or parties
against potential costs or liabilities. The Trust's maximum exposure under these
arrangements is dependent on claims that may be made in the future and,
therefore, cannot be estimated. The Trust has had no prior claims or losses
pursuant to any such agreement.
2. TRANSACTIONS WITH AFFILIATES
Management Agreement
The Trust and the Manager are parties to a Management Agreement that
obligates the Manager to provide or oversee the provision of all administrative,
investment advisory, fund management and securities lending services. Investment
assets of the Fund are managed by multiple investment advisors that have entered
into separate investment advisory agreements with the Manager. As compensation
for performing the duties required under the Management Agreement, the Manager
receives from the Fund an annualized fee
19
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
equal to 0.05% of the average daily net assets plus amounts paid by the Manager
to the investment advisors hired by the Manager to direct investment activities
of the Funds. Management fees paid during the six months ended April 30, 2009
were as follows (dollars in thousands):
AMOUNTS PAID TO
MANAGEMENT FEE RATE MANAGEMENT FEE INVESTMENT ADVISORS NET AMOUNTS RETAINED BY MANAGER
- ------------------- -------------- ------------------- --------------------------------
0.30%-0.55% $3,419 $3,043 $376
As compensation for services provided by the Manager in connection
with securities lending activities, the Fund pays to the Manager, with respect
to cash collateral posted by borrowers, a fee up to 25% of the net monthly
interest income (the gross interest income earned by the investment of cash
collateral, less the amount paid to borrowers and related expenses) from such
activities and, with respect to loan fees paid by borrowers when a borrower
posts collateral other than cash, a fee up to 25% of such loan fees. This fee is
netted against securities lending income in the Statement of Operations. During
the six months ended April 30, 2009, securities lending fees paid to the Manager
by the Fund were $341,367.
Administrative Services Agreement
The Manager and the Trust entered into an Administrative Services
Agreement which obligates the Manager to provide or oversee administrative
services to the Fund. As compensation for performing the duties required under
the Administrative Services Agreement, the Manager receives an annualized fee of
0.30% of the average daily net assets of the Institutional, Investor, and
Advisor Classes of the Fund and 0.05% of the average daily net assets of the AMR
Class of the Fund.
Distribution Plans
The Fund, except for the Advisor Class of the Fund, has adopted a
"defensive" Distribution Plan (the "Plan") in accordance with Rule 12b-1 under
the Act, pursuant to which no fees may be charged to the Fund for distribution
purposes. However, the Plan authorizes the management and administrative service
fees received by the Manager and the investment advisors hired by the Manager to
be used for distribution purposes. Under this Plan, the Fund does not intend to
compensate the Manager or any other party, either directly or indirectly, for
the distribution of Fund shares.
A separate Distribution Plan (the "Distribution Plan") has been
adopted pursuant to Rule 12b-1 under the Act for the Advisor Class of the Fund.
Under the Distribution Plan, as compensation for distribution assistance, the
Manager receives an annual fee of 0.25% of the average daily net assets of the
Advisor Class. The fee will be payable without regard to whether the amount of
the fee is more or less than the actual expenses incurred in a particular month
by the Manager for distribution assistance.
Service Plans
The Manager and the Trust entered into Service Plans that obligate the
Manager to oversee additional shareholder servicing of the Investor and Advisor
Classes. As compensation for performing the duties required under the Service
Plans, the Manager receives up to 0.375% of the average daily net assets of the
Investor Class and 0.25% of the average daily net assets of the Advisor Class of
the Fund.
Brokerage Commissions
Affiliated entities of an investment advisor to the Fund received net
commissions on purchases and sales of the Fund's portfolio securities totaling
$34,246 for the six months ended April 30, 2009.
20
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Investment in Affiliated Funds
The Fund may invest in the American Beacon Money Market Select Fund
(the "MM Select Fund") and the American Beacon US Government Money Market Select
Fund (the "USG Select Fund") (collectively, the "Select Funds"). Cash collateral
received by the Fund in connection with securities lending may be invested in
the Select Funds. The Select Funds and the Fund have the same investment advisor
and therefore, are considered to be affiliated. The Manager serves as investment
advisor to the Select Funds and receives from the Select Funds an annualized fee
of 0.09% of the average daily net assets of the Select Funds. During the six
months ended April 30, 2009, the Manager earned fees from the Select Funds
totaling $10,511 on the Fund's direct investment in the Select Funds and $27,325
from the Fund's securities lending collateral invested in the Select Funds.
Interfund Lending Program
Pursuant to an exemptive order by the Securities Exchange Commission
("SEC"), the Fund, along with other registered investment companies having
management contracts with the Manager, may participate in an interfund lending
program as a borrower. This program provides an alternative credit facility
allowing the Fund to borrow from other participating Funds. During the six
months ended April 30, 2009, the Fund did not utilize the credit facility.
Expense Reimbursement Plan
The Fund has adopted an Expense Reimbursement Plan whereby the Manager
may seek repayment of fees waived or expenses reimbursed for a period of up to
three years. However, reimbursement will occur only if the Class' average net
assets have grown or expenses have declined sufficiently to allow reimbursement
without causing its expense ratio to exceed the previously agreed upon
contractual expense limit. For the six months ended April 30, 2009, there were
no fees waived or reimbursed expenses subject to potential recovery.
3. FEDERAL INCOME AND EXCISE TAXES
It is the policy of the Fund to comply with the requirements of
Subchapter M of the Internal Revenue Code and to distribute substantially all
net investment income as well as any net realized capital gains on the sale of
investments. Therefore, no federal income or excise tax provision is required.
The Fund adopted the provisions of FASB Interpretation No. 48,
"Accounting for Uncertainties in Income Taxes" ("FIN 48"), on January 1, 2007.
FIN 48 sets forth a minimum threshold for financial statement recognition of the
benefit of a tax position taken or expected to be taken in a tax return. The
implementation of FIN 48 did not result in any unrecognized tax benefits in the
accompanying financial statements. Each of the tax years in the three year
period ended October 31, 2008 remains subject to examination by the Internal
Revenue Service. If applicable, the Fund recognizes interest accrued related to
unrecognized tax benefits in interest expense and penalties in "Other expenses"
on the Statement of Operations.
Dividends are categorized in accordance with income tax regulations
which may treat certain transactions differently than U.S. generally accepted
accounting principles. Accordingly, the character of distributions and
composition of net assets for tax purposes may differ from those reflected in
the accompanying financial statements.
The tax character of distributions paid during the six months ended
April 30, 2009 and the fiscal year ended October 31, 2008 were as follows (in
thousands):
21
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
SIX MONTHS
ENDED YEAR ENDED
APRIL 30, OCTOBER 31,
2009 2008
----------- -----------
(unaudited)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class .. $ 13,600 $ 37,816
Investor Class ....... 8,841 32,770
Advisor Class ........ 311 1,545
AMR Class ............ 3,927 11,905
LONG-TERM CAPITAL GAIN
Institutional Class... -- 128,189
Investor Class ....... -- 122,514
Advisor Class ........ -- 6,516
AMR Class ............ -- 36,603
-------- --------
TOTAL DISTRIBUTIONS PAID $ 26,679 $377,858
======== ========
* For tax purposes, short-term capital gains are considered ordinary income
distributions.
As of April 30, 2009, the components of distributable earnings on a tax basis
were as follows (in thousands):
Cost basis of investments for federal income tax purposes .. $2,353,626
Unrealized appreciation .................................... 110,828
Unrealized depreciation .................................... (484,478)
----------
Net unrealized appreciation/(depreciation) (373,650)
Undistributed ordinary income .............................. 4,931
Undistributed long-term gain/(loss) ........................ (558,059)
----------
Distributable earnings ..................................... $ (926,778)
==========
Financial reporting records are adjusted for permanent book/tax
differences to reflect tax character. Financial records are not adjusted for
temporary differences. The temporary differences between financial reporting and
tax-basis reporting of unrealized appreciation/(depreciation) are attributable
primarily to the tax deferral of losses from wash sales, the realization for tax
purposes of unrealized gains/(losses) on certain derivative instruments, and
reclassifications of income from real estate investment securities.
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under U.S. generally accepted accounting principles and
federal income tax regulations, permanent differences between book and tax
reporting have been identified and appropriately reclassified on the Statement
of Assets and Liabilities.
Accordingly, the following amounts represent current year permanent
differences derived from reclassifications of income from real estate investment
securities, foreign currency, and dividend reclasses that have been reclassified
as of April 30, 2009 (in thousands):
Paid-in-capital ........................................... $ (1)
Undistributed net investment income ....................... (208)
Accumulated net realized gain (loss) ...................... 210
Unrealized appreciation (depreciation) of investments,
futures contracts and foreign currency.................. (1)
At April 30, 2009, the capital loss carry forward position of the Fund
for federal income tax purposes was $259,968 and $298,091 expiring in 2016 and
2017, respectively.
4. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales of investments, other
than short-term obligations, for the six months ended April 30, 2009 were (in
thousands) $588,892 and $480,568, respectively.
22
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
A summary of the Fund's direct transactions in the Select Funds for
the six months ended April 30, 2009 is set forth below (in thousands):
OCTOBER 31, 2008 APRIL 30, 2009
AFFILIATE SHARES/MARKET VALUE PURCHASES SALES SHARES/MARKET VALUE
- --------------- -------------------- --------- ------- -------------------
MM Select Fund $93,829 $ -- $93,829 $ --
USG Select Fund $ -- $20,000 $ -- $20,000
5. SECURITIES LENDING
The Fund may lend its securities to qualified financial institutions,
such as certain broker-dealers, to earn additional income. The borrowers are
required to secure their loans continuously with collateral in an amount at
least equal to the fair value of the securities loaned, initially in an amount
at least equal to 102% of the fair value of domestic securities loaned and 105%
of the fair value of international securities loaned. Collateral is monitored
and marked to market daily. Daily mark to market amounts are required to be paid
to the borrower or received from the borrower by the end of the following
business day. This one day settlement for mark to market amounts may result in
the collateral being temporarily less than the value of the securities on loan
or temporarily more than the required minimum collateral. The amount of this
temporary difference at April 30, 2009 is disclosed as the calculated mark in
the table below.
To the extent that a loan is collateralized by cash, such cash
collateral shall be invested by the securities lending agent (the "Agent") in
money market mutual funds, and other short-term investments, provided the
investments meet certain quality and diversification requirements.
Securities lending income is generated from the demand premium (if
any) paid by the borrower to borrow a specific security and from the return on
investment of cash collateral, reduced by negotiated rebate fees paid to the
borrower and transaction costs. To the extent that a loan is secured by non-cash
collateral, securities lending income is generated as a demand premium reduced
by transaction costs. The Fund, the Agent, and the Manager retain 75%, 15%, and
10%, respectively, of the income generated from securities lending.
While securities are on loan, the Fund continues to receive any income
associated with that security and any gain or loss in the market price that may
occur during the term of the loan.
Securities lending transactions pose certain risks to the Fund,
including that the borrower may not provide additional collateral when required
or return the securities when due, that the value of the short-term investments
will be less than the amount of cash collateral required to be returned to the
borrower, that non-cash collateral may be subject to legal constraints in the
event of a borrower bankruptcy, and that the cash collateral investments could
become illiquid and unable to be used to return collateral to the borrower. The
Fund could also experience delays and costs in gaining access to the collateral.
The Fund bears the risk of any deficiency in the amount of the cash collateral
available for return to the borrower and any action which impairs its ability to
liquidate non-cash collateral to satisfy a borrower default.
As of April 30, 2009, the value of outstanding securities on loan and
the value of collateral was as follows (in thousands):
MARKET VALUE OF TOTAL VALUE OF
SECURITIES ON LOAN NON-CASH COLLATERAL CASH COLLATERAL POSTED BY BORROWER CALCULATED MARK COLLATERAL
- ------------------ ------------------- ---------------------------------- --------------- --------------
$296,615 $-- $305,087 $(358) $304,729
Cash collateral is listed in the Fund's Schedule of Investments and is
shown on the Statement of Assets and Liabilities. Income earned on these
investments is included in Income derived from securities lending in the
Statement of Operations.
23
AMERICAN BEACON SMALL CAP VALUE FUND(SM)
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Non-cash collateral received by the Fund may not be sold or re-pledged
except to satisfy a borrower default. Therefore, non-cash collateral is not
included on the Fund's Schedule of Investments or Statement of Assets and
Liabilities.
6. CAPITAL SHARE TRANSACTIONS
The tables below summarize the activity in capital shares for each
Class of the Fund (dollars and shares in thousands):
Six Months Ended April 30, 2009
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
------------------- ---------------- ---------------- ----------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
------- --------- ------ ------- ------ ------- ------ --------
Shares sold ..................... 13,145 $141,353 7,484 $78,815 442 $ 4,522 1,378 $ 14,878
Reinvestment of dividends ....... 1,226 13,407 813 8,704 29 311 362 3,927
Shares redeemed ................. (13,360) (141,099) (8,880) (90,406) (946) (10,150) (2,185) (22,241)
------- -------- ------ ------- ----- ------- ------ --------
Net increase (decrease) in shares
outstanding .................. 1,011 $ 13,661 (583) $(2,887) (475) $(5,317) (445) $ (3,436)
======= ======== ===== ======= ===== ======= ====== ========
Year Ended October 31, 2008
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
------------------- ------------------- ---------------- ------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
------- --------- ------- --------- ------ ------- ------ ---------
Shares sold ..................... 14,496 $ 244,453 10,422 $ 172,430 888 $14,694 1,925 $ 32,194
Reinvestment of dividends ....... 8,983 161,791 8,677 152,805 460 8,061 2,708 48,508
Shares redeemed ................. (21,496) (364,982) (22,737) (376,472) (1,809) (29,610) (6,475) (108,132)
------- --------- ------- --------- ------ ------- ------ ---------
Net increase (decrease) in shares
outstanding .................. 1,983 $ 41,262 (3,638) $ (51,237) (461) $(6,855) (1,842) $ (27,430)
======= ========= ======= ========= ====== ======= ====== =========
24
(This page intentionally Left blank)
25
AMERICAN BEACON SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
---------------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------------
2009 2008 2007 2006 2005(A) 2004(B)
----------- -------- ---------- ---------- ---------- --------
(unaudited)
Net asset value, beginning of period .... $ 12.53 $ 22.10 $ 22.53 $ 20.43 $ 18.85 $ 16.21
-------- -------- ---------- ---------- ---------- --------
Income from investment operations:
Net investment income ................ 0.08 0.25 0.22 0.19 0.11 0.07
Net gains (losses) on securities (both
realized and unrealized) .......... (0.51) (7.13) 1.10 2.94 2.31 3.09
-------- -------- ---------- ---------- ---------- --------
Total income (loss) from investment
operations ........................... (0.43) (6.88) 1.32 3.13 2.42 3.16
-------- -------- ---------- ---------- ---------- --------
Less distributions:
Dividends from net investment
income ............................ (0.20) (0.22) (0.19) (0.14) (0.07) (0.08)
Distributions from net realized gains
on securities ..................... -- (2.47) (1.56) (0.89) (0.77) (0.44)
-------- -------- ---------- ---------- ---------- --------
Total distributions ..................... (0.20) (2.69) (1.75) (1.03) (0.84) (0.52)
-------- -------- ---------- ---------- ---------- --------
Net asset value, end of period .......... $ 11.90 $ 12.53 $ 22.10 $ 22.53 $ 20.43 $ 18.85
======== ======== ========== ========== ========== ========
Total return ............................ (3.27)%(C) (34.84)% 6.10% 15.80% 12.90% 19.86%
======== ======== ========== ========== ========== ========
Ratios and supplemental data:
Net assets, end of period (in
thousands) ........................ $797,010 $826,232 $1,413,734 $1,319,024 $1,076,909 $429,540
Ratios to average net assets
(annualized):
Expenses, net of waivers .......... 0.82% 0.81% 0.80% 0.82% 0.87% 0.89%
Expenses before waivers ........... 0.82% 0.81% 0.80% 0.82% 0.87% 0.89%
Net investment income (loss),
net of waivers ................. 1.46% 1.36% 0.94% 0.83% 0.66% 0.57%
Net investment income (loss),
before waivers ................. 1.46% 1.36% 0.94% 0.83% 0.66% 0.57%
Portfolio turnover rate .............. 34%(C) 62% 52% 48% 47% 35%
Investor Class
---------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------
2009 2008 2007 2006
----------- -------- ---------- ----------
(unaudited)
Net asset value, beginning of period .... $ 12.22 $ 21.62 $ 22.08 $ 20.04
-------- -------- ---------- ----------
Income from investment operations:
Net investment income ................ 0.07 0.20 0.16 0.13
Net gains (losses) on securities (both
realized and unrealized) .......... (0.49) (6.97) 1.07 2.89
-------- -------- ---------- ----------
Total income (loss) from investment
operations ........................... (0.42) (6.77) 1.23 3.02
-------- -------- ---------- ----------
Less distributions:
Dividends from net investment
income ............................ (0.16) (0.16) (0.13) (0.09)
Distributions from net realized gains
on securities ..................... -- (2.47) (1.56) (0.89)
-------- -------- ---------- ----------
Total distributions ..................... (0.16) (2.63) (1.69) (0.98)
-------- -------- ---------- ----------
Net asset value, end of period .......... $ 11.64 $ 12.22 $ 21.62 $ 22.08
======== ======== ========== ==========
Total return ............................ (3.34)%(C) (35.04)% 5.83% 15.56%
======== ======== ========== ==========
Ratios and supplemental data:
Net assets, end of period (in
thousands) ........................ $659,524 $699,670 $1,316,188 $1,333,814
Ratios to average net assets
(annualized):
Expenses, net of waivers .......... 1.08% 1.06% 1.05% 1.06%
Expenses before waivers ........... 1.08% 1.06% 1.05% 1.06%
Net investment income (loss),
net of waivers ................. 1.21% 1.12% 0.70% 0.59%
Net investment income (loss),
before waivers ................. 1.21% 1.12% 0.70% 0.59%
Portfolio turnover rate .............. 34%(C) 62% 52% 48%
(A) Opus Capital Group, LLC was added as an investment advisor on February 1,
2005 and Metropolitan West Capital Management, LLC and Dreman Value
Management, LLC were added as investment advisors on August 31, 2005.
(B) The Boston Company Asset Management, LLC was added as an investment advisor
to the Small Cap Value Fund on September 27, 2004.
(C) Not annualized.
26
Advisor Class
---------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ------------------------------------------------
2005(A) 2004(B) 2009 2008 2007 2006 2005(A) 2004(B)
- ---------- -------- ----------- ------- ------- ------- ------- -------
(unaudited)
$ 18.54 $ 15.95 $ 12.13 $ 21.46 $ 21.94 $ 19.94 $ 18.49 $ 15.92
- ---------- -------- ------- ------- ------- ------- ------- -------
0.09 0.08 0.06 0.16 0.10 0.07 0.04 0.01
2.24 2.98 (0.49) (6.93) 1.07 2.88 2.23 3.00
- ---------- -------- ------- ------- ------- ------- ------- -------
2.33 3.06 (0.43) (6.77) 1.17 2.95 2.27 3.01
- ---------- -------- ------- ------- ------- ------- ------- -------
(0.06) (0.03) (0.12) (0.09) (0.09) (0.06) (0.05) --
(0.77) (0.44) -- (2.47) (1.56) (0.89) (0.77) (0.44)
- ---------- -------- ------- ------- ------- ------- ------- -------
(0.83) (0.47) (0.12) (2.56) (1.65) (0.95) (0.82) (0.44)
- ---------- -------- ------- ------- ------- ------- ------- -------
$ 20.04 $ 18.54 $ 11.58 $ 12.13 $ 21.46 $ 21.94 $ 19.94 $ 18.49
========== ======== ======= ======= ======= ======= ======= =======
12.63% 19.56% (3.50)%(C) (35.19)% 5.55% 15.23% 12.32% 19.24%
========== ======== ======= ======= ======= ======= ======= =======
$1,320,853 $466,364 $26,471 $33,479 $69,112 $70,602 $44,709 $11,828
1.10% 1.15% 1.33% 1.31% 1.32% 1.34% 1.40% 1.38%
1.10% 1.15% 1.33% 1.31% 1.32% 1.34% 1.40% 1.69%
0.42% 0.33% 0.98% 0.86% 0.43% 0.31% 0.12% 0.17%
0.42% 0.33% 0.98% 0.86% 0.43% 0.31% 0.12% (0.14)%
47% 35% 34%(C) 62% 52% 48% 47% 35%
AMR Class
- ---------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------
2009 2008 2007 2006 2005(A) 2004(B)
- ----------- -------- -------- -------- -------- --------
(unaudited)
$ 12.48 $ 22.05 $ 22.48 $ 20.38 $ 18.78 $ 16.13
-------- -------- -------- -------- -------- --------
0.11 0.33 0.30 0.27 0.21 0.14
(0.52) (7.15) 1.08 2.91 2.26 3.04
-------- -------- -------- -------- -------- --------
(0.41) (6.82) 1.38 3.18 2.47 3.18
-------- -------- -------- -------- -------- --------
(0.24) (0.28) (0.25) (0.19) (0.10) (0.09)
-- (2.47) (1.56) (0.89) (0.77) (0.44)
-------- -------- -------- -------- -------- --------
(0.24) (2.75) (1.81) (1.08) (0.87) (0.53)
-------- -------- -------- -------- -------- --------
$ 11.83 $ 12.48 $ 22.05 $ 22.48 $ 20.38 $ 18.78
======== ======== ======== ======== ======== ========
(3.09)%(C) (34.71)% 6.39% 16.12% 13.23% 20.12%
======== ======== ======== ======== ======== ========
$193,690 $209,927 $411,406 $412,857 $424,965 $438,353
0.57% 0.56% 0.54% 0.55% 0.58% 0.60%
0.57% 0.56% 0.54% 0.55% 0.58% 0.60%
1.72% 1.62% 1.21% 1.10% 0.94% 0.84%
1.72% 1.62% 1.21% 1.10% 0.94% 0.84%
34%(C) 62% 52% 48% 47% 35%
27
(AMERICAN BEACON FUNDS(SM) LOGO)
DELIVERY OF DOCUMENTS
To reduce expenses, your financial institution may mail only one copy of the
Prospectus, Annual Report and Semi-Annual Report to those addresses shared by
two or more accounts. If you wish to receive individual copies of these
documents, please contact your financial institution. Delivery of individual
copies will commence thirty days after receiving your request.
If you invest in the Fund through a financial institution, you may be able to
receive the Fund's regulatory mailings, such as the Prospectus, Annual Report
and Semi-Annual Report, by e-mail. If you are interested in this option, please
go to www.icsdelivery.com and search for your financial institution's name or
contact your financial institution directly.
TO OBTAIN MORE INFORMATION ABOUT THE FUND:
(GRAPHIC)
BY E-MAIL:
american_beacon.funds@ambeacon.com
(GRAPHIC)
BY TELEPHONE:
Institutional Class
Call (800) 658-5811
AMR Class(SM)
Call (800) 345-2345
Investor Class(R) and Advisor Class
Call (800) 388-3344
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
In addition to the Schedule of Investments provided in each semi-annual and
annual report, the Fund files a complete schedule of its portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q as of the first and
third fiscal quarters. The Fund's Forms N-Q are available on the SEC's website
at www.sec.gov. The Forms N-Q may also be reviewed and copied at the SEC's
Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549. Information
regarding the operation of the SEC's Public Reference Room may be obtained by
calling 1-800-SEC-0330. A complete schedule of the Fund's portfolio holdings is
also available on the Funds' website (www.americanbeaconfunds.com) approximately
thirty days after the end of each month.
(GRAPHIC)
ON THE INTERNET:
Visit our website at www.americanbeaconfunds.com
(GRAPHIC)
BY MAIL:
American Beacon Funds
P.O. Box 219643
Kansas City, MO 64121-9643
AVAILABILITY OF PROXY VOTING POLICY AND RECORDS
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available in the Fund's
Statement of Additional Information, is available free of charge on the Fund's
website (www.americanbeaconfunds.com) and by calling 1-800-967-9009 or by
accessing the SEC's website at www.sec.gov. The Fund's proxy voting record for
the most recent year ended June 30 is filed annually with the SEC on Form N-PX.
The Fund's Forms N-PX are available on the SEC's website at www.sec.gov. The
Fund's proxy voting record may also be obtained by calling 1-800-967-9009.
FUND SERVICE PROVIDERS:
CUSTODIAN TRANSFER AGENT INDEPENDENT REGISTERED DISTRIBUTOR
STATE STREET BANK AND BOSTON FINANCIAL DATA PUBLIC ACCOUNTING FIRM FORESIDE FUND SERVICES
TRUST SERVICES ERNST & YOUNG LLP Portland, Maine
Boston, Massachusetts Kansas City, Missouri Dallas, Texas
This report is prepared for shareholders of the American Beacon Funds and may be
distributed to others only if preceded or accompanied by a current prospectus.
American Beacon Funds and American Beacon Small Cap Value Fund are service marks
of American Beacon Advisors, Inc.
SAR 04/09
00068035
GUIDANCE | VISION | EXPERIENCE
(AMERICAN BEACON FUNDS(SM) LOGO)
SEMI-ANNUAL REPORT
(GRAPHIC)
April 30, 2009
EMERGING MARKETS FUND
INTERNATIONAL EQUITY FUND
ABOUT AMERICAN BEACON ADVISORS
Since 1986, American Beacon Advisors has offered a variety of products and
investment advisory services to numerous institutional and retail clients,
including a variety of mutual funds, corporate cash management, and separate
account management.
Our clients include defined benefit plans, defined contribution plans,
foundations, endowments, corporations, financial planners, and other
institutional investors. With American Beacon Advisors, you can put the
experience of a multi-billion dollar asset management firm to work for your
company.
CONTENTS
Message from American Beacon.......................... 1
Annualized Total Returns.............................. 3
Market and Performance Overview....................... 6
American Beacon Schedules of Investments
Emerging Markets Fund.............................. 10
International Equity Fund.......................... 15
ADDITIONAL INFORMATION ............................... Back Cover
Any opinions herein, including forecasts, reflect our judgment as of the end of
the reporting period and are subject to change. Each advisor's strategies and
the Fund's portfolio composition will change depending on economic and market
conditions. This report is not a complete analysis of market conditions and,
therefore, should not be relied upon as investment advice. Although economic and
market information has been compiled from reliable sources, American Beacon
Advisors, Inc. makes no representation as to the completeness or accuracy of the
statements contained herein.
Investing in foreign equities entails additional risk not associated with
domestic equities, such as currency fluctuations, economic and political
instability and differences in accounting standards. The risks of investing in
foreign equities are heightened when investing in emerging markets.
American Beacon Funds April 30, 2009
(PHOTO OF GENE L. NEEDLES)
FELLOW SHAREHOLDERS,
Please allow me to introduce myself. I am Gene Needles, Jr., the new
Executive Vice President for the American Beacon Funds. I have over 27 years of
financial services experience with some of the country's largest fund complexes,
and I will be primarily responsible for daily operations as well as distribution
of the American Beacon Funds. I am very excited to be a part of American Beacon
and look forward to building a lasting relationship with all of our
shareholders.
Enclosed is the American Beacon Emerging Markets and International Equity
Funds Semi-Annual Report for the six months ended April 30, 2009.
During the six-month period covered by this report, the capital markets
experienced widespread volatility brought on by concern over the world-wide
credit crisis. The American Beacon Emerging Markets and International Equity
Funds, both Institutional Class, reported six-month returns of 14.88% and
- -1.98%, respectively, for the period ended April 30, 2009 while the MSCI
Emerging Markets Indices and MSCI EAFE reported returns of 17.38% and -2.64%,
respectively, for this period.
In the past, long-term investors have been rewarded for their patience. We
continue to believe the Funds' fundamental investment strategies will continue
to serve the Funds well over time.
Please review the enclosed market overview, portfolio listings, and
detailed financial data. As always, we welcome the opportunity to serve your
financial needs. To obtain further details about the American Beacon Funds
family or to access your account information, please visit our website at
www.americanbeaconfunds.com. Thank you for your continued confidence in the
American Beacon Funds.
Sincerely,
/s/ Gene L. Needles
Gene L. Needles, Jr.
Executive Vice President
American Beacon Funds
1
EMERGING MARKETS OVERVIEW
APRIL 30, 2009 (UNAUDITED)
For the six months ended April 30 2009, the MSCI Emerging Markets Index
produced a return of 17.4%. 2008 ended on a painful note for investors as the US
housing crisis created an unprecedented implosion of credit, demand, and
confidence. Emerging markets were not spared in the aftermath. It became clear
that local consumption could not offset the dramatic fall in exports to the
U.S., Europe, and Japan. As the global recession threatened to become the worst
since the early 1980's, factories across emerging markets were closing,
dissolving job creation and creating a vicious circle of rising unemployment and
weak consumption. This sharp reversal in Gross Domestic Product ("GDP")
expansion forced emerging market central banks to slash interest rates, even in
countries with vulnerable currencies, such as Turkey and South Africa.
As the new year progressed, marginal month-over-month improvements in U.S.
housing, income and consumption data, coupled with the positive investor
reception of the U.S. Treasury's plan to partner with private investors to
purchase toxic bank assets, spurred a market rally. Stimulus packages were
enacted worldwide, representing an unprecedented commitment from governments
across the globe to stabilize the world's economies.
Although the global economy remains under tremendous stress, an improvement
in the pace of contraction helped strengthen investor confidence. With emerging
markets among the worst performing equities last year, the rebound was
expectedly robust. The favored BRIC markets (Brazil, Russia, India, China) and
cyclical sectors delivered strong results, but low quality areas actually posted
sizable gains. Many of these markets, such as Eastern Europe, were oversold and
due for some type of re-rating. Currencies have rebounded, lowering inflation
risk and allowing for more accommodative monetary policy; the Reserve Bank of
India, for example, had slashed its lending rate to 4.75% by April 21, 2009.
Many economists are watching China, where government officials have delivered a
stimulus package rivaled only by the U.S. Loans are already soaring and 2009 GDP
forecasts for China may be conservative.
2
PERFORMANCE OVERVIEW
AMERICAN BEACON EMERGING MARKETS FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Emerging Markets Fund returned 14.88% for
the six months ended April 30, 2009. The Fund underperformed the MSCI Emerging
Markets Index ("Index") return of 17.38% but outperformed the Lipper Emerging
Markets Funds Index return of 11.51% for the period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
----------------------------------------
SINCE
INCEP.
6 MONTHS* 1 YEAR 5 YEARS (7/31/00)
--------- ------ ------- ---------
Institutional Class(1,4) ....... 14.88% -42.37% 9.20% 7.38%
Investor Class(1,2,4) .......... 14.77% -42.55% 8.88% 7.14%
AMR Class(1,4) ................. 15.06% -42.21% 9.46% 7.66%
MSCI Emg Mkts
Index(3) .................... 17.38% -42.90% 11.10% 7.78%
Lipper Emg Mkts Funds
Index(3) .................... 11.51% -46.11% 8.94% 6.76%
* Not annualized
1. The Investor Class was formerly known as the PlanAhead Class. Performance
shown is historical and may not be indicative of future returns. Investment
returns and principal value will vary, and shares may be worth more or less
at redemption than at original purchase. Performance shown is as of date
indicated, and current performance may be lower or higher than the
performance data quoted. To obtain performance as of the most recent month
end, please visit www.americanbeaconfunds.com or call 1-800-967-9009. Fund
performance in the table above does not reflect the deduction of taxes a
shareholder would pay on distributions or the redemption of shares.
2. Fund performance for the since inception period represents the total
returns achieved by the Institutional Class from 7/31/00 up to 10/1/02, the
inception date of the Investor Class, and the returns of the Investor Class
since its inception. Expenses of the Investor Class are higher than those
of the Institutional Class. Therefore, total returns shown may be higher
than they would have been had the Investor Class been in existence since
7/31/00. A portion of the fees charged to the Investor Class of the Fund
was waived in 2004 and 2005 and recouped in 2006. Performance prior to fee
waivers and fee recoupment is different than the actual returns shown.
3. The MSCI Emerging Markets Index is a market capitalization weighted index
composed of companies that are representative of the market structure of
developing countries in Latin America, Asia, Eastern Europe, the Middle
East and Africa. The Lipper Emerging Market Funds Index tracks the results
of the 30 largest mutual funds in the Lipper Emerging Market Funds
category. Lipper is an independent mutual fund research and ranking
service. One cannot directly invest in an index.
4. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor and AMR Class shares was
1.39%, 1.73% and 1.18%, respectively. The expense ratios above may vary
from the expense ratios presented in other sections of this report that are
based on expenses incurred during the period covered by this report.
The Fund underperformed the Index over the six-month period due to the
Fund's equitized cash balances returning less than the Index and stock
selection. Country allocation added value for the period.
Poor stock selections in South Korea, Brazil, and India more than offset
positive selections in Taiwan and led to the relative underperformance. In South
Korea, investments in Samsung Electronics Co. Ltd. (up 11.3%) and Sk Telecom Co.
Ltd. (down 8.9%) hurt performance. Braskem S.A. (down 35.7%) in Brazil and
Satyam Computer Services Ltd. (down 82.1%) in India also contributed negatively
to the Fund's relative performance. Investments in Taiwanese stocks Chinatrust
Financial Holding Co. Ltd. (up 60.0%), Quanta Computer, Inc. (up 43.2%), and
United Microelectronics Corp. (up 35.1%) benefited performance for the period.
Relative contribution from country allocation was positive for the
six-month period, as a result of overweighting China (up 30.1%) and Indonesia
(up 44.9%). Overweighting Poland (down 20.3%) hurt performance for the period.
The Fund's basic philosophy remains focused on investing in attractively
valued companies with above-average earnings growth expectations.
3
PERFORMANCE OVERVIEW
AMERICAN BEACON EMERGING MARKETS FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
------------
Samsung Electronics Co. Ltd. .............. 3.5%
Petroleo Brasileiro S.A. .................. 2.9%
China Mobile Ltd. ......................... 2.6%
Taiwan Semiconductor Manufacturing Co.
Ltd. ................................... 2.0%
Itau Unibanco Banco Multiplo S.A. ......... 1.9%
PetroChina Co. Ltd. ....................... 1.9%
LUKOIL Oil Co. ............................ 1.6%
Gazprom OAO ............................... 1.6%
America Movil, S.A.B. de C.V. ............. 1.6%
Cia Vale do Rio Doce ...................... 1.5%
SECTOR ALLOCATION
% OF
EQUITIES
--------
Financials................................. 24.7%
Telecommunication Services................. 15.1%
Information Technology .................... 13.3%
Energy..................................... 12.2%
Materials.................................. 10.0%
Consumer Discretionary..................... 8.2%
Industrials................................ 5.1%
Consumer Staples........................... 4.9%
Utilities.................................. 4.8%
Health Care................................ 1.7%
COUNTRY ALLOCATION
(PIE CHART)
% OF
EQUITIES
---------
China...................................... 18.5%
South Korea................................ 13.9%
Brazil..................................... 13.0%
Taiwan..................................... 10.9%
Other Asia................................. 9.8%
Other Europe, Middle East, Africa.......... 8.6%
India...................................... 8.1%
South Africa............................... 7.6%
Russia..................................... 5.7%
Mexico..................................... 3.9%
Investing in foreign equities entails additional risk not associated with
domestic equities, such as currency fluctuations, economic and political
instability and differences in accounting standards. The risks of investing in
foreign equities are heightened when investing in emerging markets.
4
FUND EXPENSES
AMERICAN BEACON EMERGING MARKETS FUND(SM)
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, such as redemption fees, and (2) ongoing costs, including management
fees, administrative service fees, distribution (12b-1) fees, and other Fund
expenses. The examples below are intended to help you understand the ongoing
cost (in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000 invested at the beginning
of the period in each Class and held for the entire period from November 1, 2008
through April 30, 2009.
ACTUAL EXPENSES
The "Actual" lines of the table provide information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading "Expenses Paid During Period" to estimate
the expenses you paid on your account during this period. Shareholders of the
Investor and Institutional Classes that invest in the Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" lines of the table provide information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed 5% per year rate of return before expenses (not the
Fund's actual return). You may compare the ongoing costs of investing in the
Fund with other funds by contrasting this 5% hypothetical example and the 5%
hypothetical examples that appear in the shareholder reports of the other funds.
The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. Shareholders
of the Investor and Institutional Classes that invest in the Fund through an IRA
may be subject to a custodial IRA fee of $12 that is typically deducted each
December. If your account was subject to a custodial IRA fee during the period,
your costs would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by the
Fund, such as redemption fees. Similarly, the expense examples for other funds
do not reflect any transaction costs charged by those funds, such as sales
charges (loads), redemption fees or exchange fees. Therefore, the "Hypothetical"
lines of the table are useful in comparing ongoing costs only and will not help
you determine the relative total costs of owning different funds. If you were
subject to any transaction costs during the period, your costs would have been
higher.
Beginning Ending
Account Account Expenses Paid
Value Value During Period*
11/1/08 4/30/09 11/1/08-4/30/09
--------- --------- ---------------
INSTITUTIONAL CLASS
Actual ....................... $1,000.00 $1,148.78 $ 9.43
Hypothetical ................. $1,000.00 $1,016.02 $ 8.85
(5% return before expenses)
INVESTOR CLASS
Actual ....................... $1,000.00 $1,147.65 $11.18
Hypothetical ................. $1,000.00 $1,014.38 $10.49
(5% return before expenses)
AMR CLASS
Actual ....................... $1,000.00 $1,150.65 $ 8.11
Hypothetical ................. $1,000.00 $1,017.26 $ 7.60
(5% return before expenses)
* Expenses are equal to the Fund's annualized expense ratios for the
six-month period of 1.77%, 2.10% and 1.52% for the Institutional, Investor
and AMR Classes respectively, multiplied by the average account value over
the period, multiplied by the number derived by dividing the number of days
in the most recent fiscal half-year (181) by days in the year (365) to
reflect the half year period.
5
INTERNATIONAL EQUITY MARKET OVERVIEW
APRIL 30, 2009 (UNAUDITED)
The six-month period encompassed the highs and the lows of recent equity
market fluctuations as the MSCI EAFE Index fell 2.6% for the period ended April
30, 2009. Stocks plummeted at the beginning of the period in the aftermath of
Lehman Brothers' failure and American International Group's effective
nationalization, and volatility neared its highest levels ever. The fallout in
credit markets from the collapse of Wall Street's investment banks was severe,
and the global credit crisis took its toll on the real economy. The Baltic Dry
Index, a key measure of global trade activity, fell by a staggering 94%,
unemployment in the U.S. hit a 26-year high, home prices and manufacturing
volumes contracted sharply, and the world economy entered its first global
recession since World War II. In response, global monetary authorities
aggressively intervened in the marketplace, pledging essentially unlimited
amounts of capital to stabilize faltering economies and shore up equity markets.
By the end of 2008, most major economies had entered, or stood on the brink of,
recession, and most major markets had delivered their worst annual returns since
the Great Depression.
The situation worsened at the beginning of 2009, as equity markets broke
through November's lows in early March due to disappointing corporate earnings
results, additional bank write-downs and the further deterioration of economic
conditions. Yet, sentiment shifted in the latter part of March, and in April,
global stocks posted their steepest monthly gains in two decades as corporate
earnings came in better than lowered expectations and investors seemed to
believe the worst of the credit crisis was behind them. The rally was led by
some of the hardest hit, most indebted and most economically sensitive sectors,
including financials, materials, industrials and consumer discretionary. In
currency markets, the Dollar weakened against the Euro, but strengthened
slightly against the Yen amid volatile trading.
6
PERFORMANCE OVERVIEW
AMERICAN BEACON INTERNATIONAL EQUITY FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the International Equity Fund returned -1.98%
for the six months ended April 30, 2009. The Fund outperformed the MSCI EAFE
Index ("Index") return of -2.64% but underperformed the Lipper International
Funds Index return of -1.59% for the period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
--------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
-------- ------ ------- --------
Institutional
Class(1,4) ....... -1.98% -41.28% 0.82% 2.22%
Investor
Class(1,4) ....... -2.15% -41.47% 0.55% 1.98%
Advisor Class
(1,2,4) .......... -2.32% -41.68% 0.27% 1.81%
AMR Class(1,4) ...... -1.91% -41.17% 1.08% 2.47%
Lipper Int'l.
Funds Index(3) ... -1.59% -42.02% 1.47% 1.39%
MSCI EAFE Index (3).. -2.64% -42.76% 0.66% -0.04%
* Not annualized
1. The Investor and Advisor Classes were formerly known as the PlanAhead and
Service Classes, respectively. Performance shown is historical and may not
be indicative of future returns. Investment returns and principal value
will vary, and shares may be worth more or less at redemption than at
original purchase. Performance shown is as of date indicated, and current
performance may be lower or higher than the performance data quoted. To
obtain performance as of the most recent month end, please visit
www.americanbeaconfunds.com or call 1-800-967-9009. Fund performance in the
table above does not reflect the deduction of taxes a shareholder would pay
on distributions or the redemption of shares.
2. Fund performance for the ten-year period represents the total returns
achieved by the Investor Class from 4/30/99 up to 5/1/03, the inception
date of the Advisor Class, and the returns of the Advisor Class since its
inception. Expenses of the Advisor Class are higher than those of the
Investor Class. As a result, total returns shown may be higher than they
would have been had the Advisor Class been in existence since 4/30/99. A
portion of the fees charged to the Advisor Class of the Fund has been
waived. Performance prior to waiving fees was lower than the actual returns
shown.
3. The Lipper International Funds Index tracks the results of the 30 largest
mutual funds in the Lipper International Funds category. Lipper is an
independent mutual fund research and ranking service. The MSCI EAFE Index
is a market capitalization weighted index of international stock
performance composed of equities from developed markets excluding the U.S.
and Canada. One cannot directly invest in an index.
4. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, Advisor and AMR Class
shares was 0.67%, 1.05%, 1.19% and 0.42%, respectively. The expense ratios
above may vary from the expense ratios presented in other sections of this
report that are based on expenses incurred during the period covered by
this report.
The Fund outperformed the Index by 0.66% over the six-month period due to
stock selection, as country allocation detracted from performance.
Stock selection had a significantly positive impact overall, particularly
in Germany, Greece, the United Kingdom, and Ireland, while the Fund lost value
through selections in Hong Kong and Canada. In Germany, Siemens AG (up 18.7%)
was the most significant contributor to relative outperformance. In Greece, the
Fund benefited from investments in Public Power Corp. S.A. (up 59.0%) and OPAP
S.A. (up 49.4%). Vodafone Group plc (down 1.9%) in the United Kingdom and CRH
plc (up 43.3%) in Ireland also helped performance. Investments in HSBC Holdings
plc (down 33.3%) in Hong Kong, and TELUS Corp. and Precision Drilling Trust
(down 27.9% and 53.1%, respectively) in Canada, weakened performance during the
period.
Country allocation hurt performance, specifically underweighting Australia
(up 7.5%) and Japan (down 2.4%), and overweighting Ireland (down 19.0%).
However, investing in South Korea (up 20.3%) added value.
Although economic and market conditions vary from period to period, the
Fund's primary strategy of investing in undervalued companies with above-average
earnings growth expectations remains consistent.
7
PERFORMANCE OVERVIEW
AMERICAN BEACON INTERNATIONAL EQUITY FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
Siemens AG....................... 2.7%
E.ON AG.......................... 2.5%
Vodafone Group plc............... 2.4%
Sanofi-Aventis S.A............... 2.3%
Total S.A........................ 2.0%
Royal Dutch Shell plc............ 1.9%
HSBC Holdings plc................ 1.9%
BP plc........................... 1.7%
BAE Systems plc.................. 1.7%
GlaxoSmithKline plc.............. 1.6%
SECTOR ALLOCATION
% OF
EQUITIES
----------
Financials....................... 19.9%
Consumer Discretionary........... 13.6%
Industrials...................... 16.0%
Energy........................... 10.4%
Telecommunication Services....... 9.2%
Consumer Staples................. 6.9%
Health Care...................... 8.2%
Materials........................ 5.4%
Information Technology........... 6.0%
Utilities........................ 4.4%
REGIONAL ALLOCATION*
(PIE CHART)
* Shown as a percentage of equities
% OF
EQUITIES
----------
Europe........................... 76.3%
Pacific Rim...................... 21.5%
North America.................... 2.2%
8
FUND EXPENSES
AMERICAN BEACON INTERNATIONAL EQUITY FUND(SM)
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, such as redemption fees, and (2) ongoing costs, including management
fees, administrative service fees, distribution (12b-1) fees, and other Fund
expenses. The examples below are intended to help you understand the ongoing
cost (in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000 invested at the beginning
of the period in each Class and held for the entire period from November 1, 2008
through April 30, 2009.
ACTUAL EXPENSES
The "Actual" lines of the table provide information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading "Expenses Paid During Period" to estimate
the expenses you paid on your account during this period. Shareholders of the
Investor and Institutional Classes that invest in the Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" lines of the table provide information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed 5% per year rate of return before expenses (not the
Fund's actual return). You may compare the ongoing costs of investing in the
Fund with other funds by contrasting this 5% hypothetical example and the 5%
hypothetical examples that appear in the shareholder reports of the other funds.
The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. Shareholders
of the Investor and Institutional Classes that invest in the Fund through an IRA
may be subject to a custodial IRA fee of $12 that is typically deducted each
December. If your account was subject to a custodial IRA fee during the period,
your costs would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by the
Fund, such as redemption fees. Similarly, the expense examples for other funds
do not reflect any transaction costs charged by those funds, such as sales
charges (loads), redemption fees or exchange fees. Therefore, the "Hypothetical"
lines of the table are useful in comparing ongoing costs only and will not help
you determine the relative total costs of owning different funds. If you were
subject to any transaction costs during the period, your costs would have been
higher.
Beginning Ending
Account Account Expenses Paid
Value Value During Period*
11/1/08 4/30/09 11/1/08-4/30/09
--------- --------- ---------------
INSTITUTIONAL CLASS
Actual $1,000.00 $ 980.24 $3.58
Hypothetical $1,000.00 $1,021.17 $3.66
(5% return before expenses)
INVESTOR CLASS
Actual $1,000.00 $ 978.46 $4.86
Hypothetical $1,000.00 $1,019.89 $4.96
(5% return before expenses)
ADVISOR CLASS
Actual $1,000.00 $ 976.82 $6.57
Hypothetical $1,000.00 $1,018.15 $6.71
(5% return before expenses)
AMR CLASS
Actual $1,000.00 $ 980.89 $2.36
Hypothetical $1,000.00 $1,022.41 $2.41
(5% return before expenses)
* Expenses are equal to the Fund's annualized expense ratios for the
six-month period of 0.73%, 0.99%, 1.34% and 0.48% for the Institutional,
Investor, Advisor and AMR Classes respectively, multiplied by the average
account value over the period, multiplied by the number derived by dividing
the number of days in the most recent fiscal half-year (181) by days in the
year (365) to reflect the half year period.
9
AMERICAN BEACON EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
BRAZIL - 11.99%
COMMON STOCKS - 8.46%
Amil Participacoes S.A. ## ................... 7,000 $ 26
Banco Bradesco S.A., ADR + ................... 12,900 158
BM & F Bovespa S.A. ## ....................... 75,000 304
Centrais Eletricas Brasileiras S.A. .......... 24,966 328
Cia de Bebidas das Americas, ADR + ........... 6,700 378
Cia de Saneamento Basico do Estado de Sao
Paulo ..................................... 9,570 136
Cia de Saneamento Basico do Estado de Sao
Paulo, ADR + .............................. 1,260 36
Cia de Saneamento de Minas Gerais-COPASA ..... 27,100 295
Cia Energetica de Minas Gerais, ADR + ........ 2,474 37
Cia Vale do Rio Doce, ADR + .................. 30,540 504
Empresa Brasileira de Aeronautica S.A.
(Embraer), ADR + .......................... 5,480 89
Grendene S.A. ................................ 45,400 309
Itau Unibanco Banco Multiplo S.A., ADR + ..... 118,875 1,632
Lojas Renner SA .............................. 19,800 181
Medial Saude S.A. ## ......................... 52,000 162
PDG Realty SA Empreendimentos e
Participacoes ............................. 17,700 167
Perdigao S.A. ## ............................. 22,605 333
Petroleo Brasileiro S.A., ADR ................ 1,750 59
Petroleo Brasileiro S.A., A Shares, ADR ...... 99,299 2,679
Vivo Participacoes S.A., ADR + ............... 7,500 120
Votorantim Celulose e Papel S.A., ADR ## + ... 10,650 93
----------
TOTAL COMMON STOCKS ............................. 8,026
----------
PREFERRED STOCKS - 3.53%
Banco Bradesco S.A. .......................... 7,500 93
Braskem S.A. ## .............................. 83,300 235
Cia de Tecidos do Norte de Minas -
Coteminas ## .............................. 57,862 107
Cia Energetica de Minas Gerais ............... 32,750 399
Cia Vale do Rio Doce, ADR .................... 59,386 815
Cia Vale do Rio Doce, A Shares ............... 9,804 136
Companhia Paranaense de Energia .............. 17,500 216
Itau Unibanco Banco Multiplo S.A. ............ 11,487 160
Net Servicos de Comunicacao S.A. ## .......... 42,377 347
Tele Norte Leste Participacoes S.A., ADR + ... 40,310 627
Ultrapar Participacoes S.A. .................. 7,600 212
----------
TOTAL PREFERRED STOCKS .......................... 3,347
----------
TOTAL BRAZIL .................................... 11,373
----------
CZECH REPUBLIC - 1.17%
COMMON STOCKS - 1.17%
CEZ .......................................... 10,752 447
Komercni Banka, a.s. ......................... 2,864 387
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Telefonica O2 ## ............................. 12,953 $ 277
----------
TOTAL CZECH REPUBLIC ............................ 1,111
----------
HONG KONG/CHINA - 17.06%
COMMON STOCKS - 17.06%
Anhui Conch Cement Co. Ltd. ## + ............. 58,200 390
Anhui Expressway Co. Ltd. .................... 324,000 163
Bank of China Ltd. ........................... 1,687,900 632
Beijing Enterprises Holdings Ltd. ## + ....... 66,500 292
Belle International Holdings Ltd. ............ 276,000 214
Bosideng International Holdings Ltd. ......... 2,798,000 227
BYD Electronic International Co. Ltd. ........ 194,000 100
China Communications Services Corp. Ltd. ## .. 256,000 152
China Construction Bank Corp. + .............. 1,116,000 652
China Life Insurance Co. Ltd. + .............. 245,000 869
China Mobile Ltd. ............................ 225,500 1,967
China Mobile Ltd., ADR ....................... 12,340 533
China Molybdenum Co. Ltd. .................... 166,000 84
China Power International Development
Ltd. + .................................... 2,261,800 511
China Railway Construction Corp. Ltd. ## ..... 66,100 92
China Resources Power Holdings Co. Ltd. ...... 120,000 271
China Telecom Corp. Ltd. ..................... 315,100 157
China Unicom Hong Kong Ltd. + ................ 336,744 388
China Zhongwang Holdings Ltd. ## ............. 392,400 358
CNOOC Ltd. ................................... 92,000 103
CNOOC Ltd., ADR + ............................ 4,040 450
COSCO Pacific Ltd. ........................... 462,000 442
Datang International Power Generation Co.
Ltd. + .................................... 294,000 143
Denway Motors Ltd. ........................... 792,700 332
Dongfang Electric Corp. Ltd. ## + ............ 93,800 247
Dongfeng Motor Group Co. Ltd. ................ 814,000 614
Focus Media Holding Ltd., ADR ## + ........... 9,100 57
Global Bio-chem Technology Group Co. Ltd. .... 1,267,800 170
GOME Electrical Appliances Holdings Ltd. ++ .. 2,368,000 345
Huaneng Power International, Inc. ## ......... 279,900 191
Huaneng Power International, Inc., ADR ## + 530 14
Industrial & Commercial Bank of China + ...... 1,010,000 584
NWS Holdings Ltd. ............................ 72,167 146
PetroChina Co. Ltd. + ........................ 1,746,000 1,543
PetroChina Co. Ltd., ADR + ................... 2,550 222
Ping'an Insurance Co. Ltd. ## + .............. 61,000 381
Shanghai Industrial Holdings Ltd. ............ 171,750 588
Sina Corp. ## ................................ 3,100 87
Sinopec Shanghai Petrochemical Co. Ltd. ...... 421,470 144
Sinotrans Ltd. ............................... 1,348,000 250
Texwinca Holdings Ltd. ....................... 244,000 150
TPV Technology Ltd. + ........................ 728,970 243
Weiqiao Textile Co. + ........................ 693,600 278
See accompanying notes
10
AMERICAN BEACON EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Yanzhou Coal Mining Co. Ltd. ## .............. 346,000 $ 326
Yanzhou Coal Mining Co. Ltd., ADR ## + ....... 8,940 86
----------
TOTAL HONG KONG/CHINA ........................... 16,188
----------
HUNGARY - 0.58%
COMMON STOCKS - 0.58%
Gedeon Richter Rt. ## ........................ 2,910 382
Magyar Telekom Telecommunications plc ........ 70,000 164
----------
TOTAL HUNGARY ................................... 546
----------
INDIA - 7.46%
COMMON STOCKS - 7.46%
ACC Ltd. ..................................... 7,700 101
Andhra Bank .................................. 89,380 100
Axis Bank Ltd. ............................... 16,900 190
Bharat Heavy Electricals Ltd. ................ 13,355 446
Bharat Petroleum Corp. Ltd. .................. 10,383 80
Deccan Chronicle Holdings Ltd. ............... 51,879 65
Dr Reddys Laboratories Ltd. ## ............... 21,210 232
Dr Reddys Laboratories Ltd., ADR ## + ........ 2,230 25
HDFC Bank Ltd. ............................... 29,263 650
Hero Honda Motors Ltd. ## .................... 12,326 292
Hindalco Industries Ltd. ..................... 87,060 94
Hindustan Petroleum Corp. Ltd. ............... 63,080 347
Hindustan Unilever Ltd. ...................... 87,767 413
ICICI Bank Ltd., ADR + ....................... 3,530 73
India Cements Ltd. ........................... 136,880 315
Infosys Technologies Ltd. .................... 17,112 512
ITC Ltd. ## .................................. 62,750 237
Jaiprakash Associates Ltd. ## ................ 19,000 53
Mahanagar Telephone Nigam Ltd. ............... 192,030 276
Mahindra & Mahindra Ltd. ..................... 8,905 88
Maruti Suzuki India Ltd. ..................... 5,882 96
Oil & Natural Gas Corp. Ltd. ................. 19,641 341
Reliance Industries Ltd. ..................... 5,190 188
State Bank of India Ltd. ## .................. 19,630 509
State Bank of India Ltd., GDR + # ............ 9,700 543
Steel Authority of India Ltd. ................ 33,406 73
Sterlite Industries (India) Ltd. ............. 6,590 55
Sterlite Industries (India) Ltd., ADR + ...... 18,830 160
Tata Consultancy Services Ltd. ............... 21,080 263
Union Bank of India ## ....................... 43,600 142
Unitech Ltd. ## .............................. 130,863 119
----------
TOTAL INDIA ..................................... 7,078
----------
INDONESIA - 2.58%
COMMON STOCKS - 2.58%
Astra International Tbk PT ................... 124,900 212
Bank Mandiri Tbk PT .......................... 969,000 254
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
PT Bank Central Asia Tbk ..................... 1,130,500 $ 358
PT Bank Rakyat Indonesia Tbk ................. 486,000 266
PT Bumi Resources Tbk ........................ 551,500 77
PT Gudang Garam Tbk .......................... 388,800 274
PT Kalbe Farma Tbk ........................... 2,502,600 213
PT Perusahaan Gas Negara Persero Tbk ......... 757,500 186
PT Telekomunikasi Indonesia Tbk .............. 814,800 604
----------
TOTAL INDONESIA ................................. 2,444
----------
ISRAEL - 1.13%
COMMON STOCKS - 1.13%
Bank Hapoalim B.M. ## ........................ 71,760 165
Check Point Software Technologies Ltd. ## + .. 9,268 215
Israel Discount Bank Ltd. .................... 236,905 223
Teva Pharmaceutical Industries Ltd., ADR + ... 10,753 472
----------
TOTAL ISRAEL .................................... 1,075
----------
MALAYSIA - 3.05%
COMMON STOCKS - 3.05%
Commerce Asset-Holding Bhd ................... 76,700 174
Digi.Com BHD ................................. 21,100 132
Gamuda Bhd ................................... 433,500 292
Genting Bhd .................................. 259,530 341
Malayan Banking Bhd .......................... 670,170 817
Resorts World Bhd ............................ 384,300 261
Sime Darby Bhd ............................... 244,500 454
Tenaga Nasional Bhd .......................... 204,400 422
----------
TOTAL MALAYSIA .................................. 2,893
----------
MEXICO - 3.63%
COMMON STOCKS - 3.63%
America Movil, S.A.B. de C.V., ADR ........... 44,787 1,471
Consorcio ARA, S.A.B. de C.V. + .............. 339,400 104
Desarrolladora Homex, S.A.B. de C.V.,
ADR ## + .................................. 6,212 115
Embotelladoras Arca, S.A.B. de C.V. + ........ 111,530 251
Gruma, S.A.B. de C.V. ## ..................... 103,490 63
Grupo Continential, S.A.B. de C.V. ........... 166,950 295
Grupo Financiero Banorte, S.A.B. de C.V. ## .. 165,689 256
Grupo Modelo, S.A.B. de C.V. ## .............. 74,400 217
Grupo Televisa, S.A., ADR ## ................. 25,000 387
Wal-Mart de Mexico, S.A.B. de C.V. + ......... 105,313 286
----------
TOTAL MEXICO .................................... 3,445
----------
NETHERLANDS - 0.00%
COMMON STOCKS - 0.00%
X5 Retail Group NV, GDR ## ................... 251 3
----------
See accompanying notes
11
AMERICAN BEACON EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
PHILIPPINES - 0.28%
COMMON STOCKS - 0.28%
ABS-CBN Broadcasting Corp. ................... 97,500 $ 34
Bank of the Philippine Islands ............... 143,527 117
Metropolitan Bank & Trust .................... 58,200 36
Union Bank of the Philippines ................ 156,300 77
----------
TOTAL PHILIPPINES ............................... 264
----------
POLAND - 1.88%
COMMON STOCKS - 1.88%
Bank Handlowy W Warszawie S.A. ## ............ 5,975 93
Bank Pekao S.A. ## ........................... 17,672 639
Bank Zachodni WBK S.A. ## .................... 5,433 144
KGHM Polska Miedz S.A. ....................... 2,688 48
PGNiG Group ## ............................... 106,450 123
Powszechna Kasa Oszczednosci Bank Polski
SA ........................................ 48,997 394
Telekomunikacja Polska S.A. .................. 65,072 344
----------
TOTAL POLAND .................................... 1,785
----------
RUSSIA - 5.23%
COMMON STOCKS - 5.23%
Gazprom OAO, ADR ............................. 83,910 1,500
LUKOIL Oil Co., ADR + ........................ 34,712 1,548
Mobile TeleSystems OJSC, ADR ## .............. 10,010 332
OAO Severstal, GDR # ......................... 9,060 35
OJSC MMC Norilsk Nickel, ADR + ............... 40,024 333
OJSC Rosneft Oil Co. ## ...................... 86,754 456
Polyus Gold Co., ADR ## + .................... 9,141 207
Vimpel-Communications, ADR ## ................ 30,276 285
Wimm-Bill-Dann Foods OJSC, ADR ## + .......... 3,912 175
X 5 Retail Group NV ## ....................... 6,524 87
----------
TOTAL RUSSIA .................................... 4,958
----------
SOUTH AFRICA - 6.96%
COMMON STOCKS - 6.96%
African Bank Investments Ltd. ................ 69,379 222
Anglo Platinum Ltd. ## ....................... 3,547 192
AngloGold Ashanti Ltd. ....................... 8,675 268
AngloGold Ashanti Ltd., ADR + ................ 21,544 664
ArcelorMittal South Africa Ltd. .............. 11,380 108
FirstRand Ltd. ............................... 312,410 481
Gold Fields Ltd., ADR + ...................... 15,760 164
Harmony Gold Mining Co. Ltd. ## .............. 15,300 143
Harmony Gold Mining Co. Ltd., ADR ## ......... 2,300 21
Impala Platinum Holdings Ltd. ................ 19,500 377
JD Group Ltd. ................................ 49,860 202
Mr Price Group Ltd. .......................... 48,193 149
MTN Group Ltd. ............................... 54,696 717
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Nampak Ltd. .................................. 211,240 $ 314
Naspers Ltd. ................................. 20,626 423
Nedbank Group Ltd. ........................... 42,284 434
SABMiller plc ................................ 14,704 251
Sanlam Ltd. .................................. 59,040 111
Sappi Ltd. ................................... 82,614 222
Sasol Ltd. ................................... 10,295 314
Sasol Ltd., ADR .............................. 4,610 139
Telkom South Africa Ltd. ..................... 34,410 436
Tiger Brands Ltd. ............................ 16,249 254
----------
TOTAL SOUTH AFRICA .............................. 6,606
----------
SOUTH KOREA - 12.82%
COMMON STOCKS - 12.54%
Amorepacific Corp. ........................... 398 212
Cheil Industries, Inc. ....................... 5,888 211
Cheil Worldwide, Inc. ........................ 1,202 218
Hanwha Chemical Corp. ........................ 5,001 45
Hyundai Motor Co. ............................ 7,638 408
Kangwon Land, Inc. ........................... 19,990 243
KB Financial Group, Inc. ## .................. 32,707 1,013
KB Financial Group, Inc., ADR ## + ........... 420 13
Korea Electric Power Corp. ## ................ 25,555 558
KT Corp. ..................................... 8,910 260
KT Corp., ADR + .............................. 27,550 395
KT&G Corp. ................................... 4,260 234
LG Chemical Ltd. ............................. 3,487 385
LG Electronics, Inc. ......................... 3,734 308
LG Telecom Ltd. .............................. 13,270 93
Lotte Shopping Co. Ltd. ...................... 2,771 484
NHN Corp. ## ................................. 3,992 484
POSCO ........................................ 1,676 519
POSCO, ADR ................................... 650 50
Samsung Electronics Co. Ltd. ................. 6,586 3,039
Samsung Fire & Marine Insurance Co. Ltd. ..... 1,810 247
Shinhan Financial Group Co. Ltd. ## .......... 34,816 860
SK Telecom Co. Ltd. .......................... 2,731 391
SK Telecom Co. Ltd., ADR ..................... 41,140 645
SSCP Co. Ltd. ## ............................. 8,596 88
Woongjin Coway Co. Ltd. ...................... 19,726 491
----------
TOTAL COMMON STOCKS ............................. 11,894
----------
PREFERRED STOCKS - 0.28%
Samsung Electronics Co. Ltd. ................. 1,043 270
----------
TOTAL SOUTH KOREA ............................... 12,164
----------
TAIWAN - 10.06%
COMMON STOCKS - 10.06%
Acer, Inc. ................................... 165,680 317
See accompanying notes
12
AMERICAN BEACON EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Cathay Financial Holding Co. Ltd.............. 351,400 $ 394
China Motor Corp.............................. 39,245 17
Chinatrust Financial Holding Co. Ltd.......... 891,267 408
Chunghwa Telecom Co. Ltd...................... 170,196 324
Compal Electronics, Inc....................... 640,379 544
First Financial Holding Co. Ltd............... 427,873 226
Fubon Financial Holding Co. Ltd. ##........... 302,000 235
HON HAI Precision Industry Co. Ltd............ 409,750 1,184
HTC Corp...................................... 35,400 480
Mega Financial Holding Co. Ltd................ 700,000 284
Nan Ya Printed Circuit Board Corp............. 104,480 292
Nien Hsing Textile Co. Ltd.................... 144,000 51
Quanta Computer, Inc.......................... 352,875 527
Siliconware Precision Industries Co. ##....... 226,000 284
SinoPac Financial Holdings Co. Ltd............ 1,851,987 487
Taiwan Fertilizer Co. Ltd..................... 21,000 48
Taiwan Semiconductor Manufacturing Co.
Ltd........................................ 1,034,503 1,727
Taiwan Semiconductor Manufacturing Co.
Ltd., ADR.................................. 12,600 133
United Microelectronics Corp.................. 2,150,226 806
Wistron Corp. ##.............................. 180,000 228
Yaego Corp.................................... 1,000,000 226
Yuanta Financial Holding Co. Ltd.............. 549,000 322
----------
TOTAL TAIWAN..................................... 9,544
----------
THAILAND - 3.14%
COMMON STOCKS - 3.14%
Bangkok Bank PCL.............................. 196,390 475
Charoen Pokphand Foods PCL.................... 3,244,200 305
Kasikornbank PCL.............................. 479,800 757
Krung Thai Bank PCL........................... 2,282,000 343
PTT Exploration & Production PCL.............. 36,000 106
PTT PCL....................................... 77,900 397
Siam Cement PCL............................... 86,500 299
Siam Commercial Bank PCL...................... 70,500 117
Thai Union Frozen Products PCL................ 297,400 177
----------
TOTAL THAILAND................................... 2,976
----------
TURKEY - 3.08%
COMMON STOCKS - 3.08%
Akbank TAS.................................... 134,472 521
Anadolu Efes Biracilik Ve Malt Sanayii
A.S. ##.................................... 21,655 154
Haci Omer Sabanci Holding A.S. ##............. 46,843 120
Turk Telekomunikasyon A.S. ##................. 36,035 99
Turkcell Iletisim Hizmetleri A.S.............. 64,058 328
Turkcell Iletisim Hizmetleri A.S., ADR ## +... 16,710 212
Turkiye Garanti Bankasi A.S. ##............... 306,541 644
Turkiye Halk Bankasi A.S. ##.................. 52,414 183
Turkiye Is Bankasi (Isbank)................... 159,310 460
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Turkiye Sise ve Cam Fabrikalari A.S. ## ...... 250,337 $ 196
----------
TOTAL TURKEY .................................... 2,917
----------
UNITED KINGDOM - 0.08%
COMMON STOCKS - 0.08%
JKX Oil & Gas plc ............................ 25,530 77
----------
SHORT TERM INVESTMENTS - 6.75%
Columbia Government Reserve Fund ............. 5,302,720 5,303
PAR
AMOUNT
------------
U.S. Treasury,
0.08%, Due 6/11/2009 ss. .................. $ 1,105 1,105
----------
TOTAL SHORT TERM INVESTMENTS .................... 6,408
----------
SHARES
------------
SECURITIES LENDING
COLLATERAL - 11.54%
American Beacon U.S. Government Money
Market Select Fund * ...................... 2,351,168 2,351
State Street Navigator Securities Lending
Prime Portfolio ........................... 8,600,738 8,601
----------
TOTAL SECURITIES LENDING COLLATERAL ............. 10,952
----------
TOTAL INVESTMENTS 110.47% - (COST $113,464) ........ 104,807
LIABILITIES, NET OF OTHER ASSETS - (10.47%) ........ (9,932)
----------
TOTAL NET ASSETS - 100.00% ......................... $ 94,875
==========
See accompanying notes
13
AMERICAN BEACON EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
++ Valued at fair value pursuant to procedures approved by the Board of
Trustees.
# Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $578 or 0.61% of net assets.
The Fund has no right to demand registration of these securities.
ss. At April 30, 2009, security pledged as collateral for open futures
contracts.
* The Fund is affiliated by having the same investment advisor.
FUTURES CONTRACTS
(DOLLARS IN THOUSANDS)
UNREALIZED
NUMBER OF EXPIRATION MARKET APPRECIATION/
CONTRACTS DATE VALUE (DEPRECIATION)
--------- ---------- ------ --------------
Emini S&P 500 Index... 171 Jun 2009 $7,439 $816
====== ====
SECTOR DIVERSIFICATION
Percent of
Net Assets
----------
Communications..................... 1.19%
Consumer Discretionary............. 7.54%
Consumer Staples................... 4.55%
Energy............................. 11.27%
Financials......................... 22.81%
Health Care........................ 1.60%
Industrials........................ 4.65%
Information Technology............. 12.21%
Materials.......................... 9.24%
Telecommunication Services......... 12.73%
Utilities.......................... 4.38%
Short Term Investments............. 18.30%
Liabilities, Net of Other Assets... (10.47)%
------
100.00%
======
See accompanying notes
14
AMERICAN BEACON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
AUSTRALIA - 0.49%
COMMON STOCKS - 0.49%
Insurance Australia Group Ltd.................... 2,154,061 $ 5,432
----------
AUSTRIA - 0.24%
COMMON STOCKS - 0.24%
Telekom Austria AG............................... 202,700 2,685
----------
BELGIUM - 0.36%
COMMON STOCKS - 0.36%
Anheuser-Busch Companies, Inc. +................. 127,200 3,924
----------
BERMUDA - 0.21%
COMMON STOCKS - 0.21%
Esprit Holdings Ltd. ##.......................... 374,000 2,309
----------
CANADA - 1.74%
COMMON STOCKS - 1.74%
Manulife Financial Corp.......................... 425,636 7,248
Precision Drilling Trust +....................... 819,901 3,896
TELUS Corp....................................... 339,469 8,108
----------
TOTAL CANADA........................................ 19,252
----------
DENMARK - 0.21%
COMMON STOCKS - 0.21%
Novo Nordisk.AS ##............................... 47,425 2,270
----------
FINLAND - 1.70%
COMMON STOCKS - 1.70%
Nokia Oyj +...................................... 988,845 14,300
UPM-Kymmene Oyj.................................. 499,367 4,513
----------
TOTAL FINLAND....................................... 18,813
----------
FRANCE - 13.60%
COMMON STOCKS - 13.60%
Accor S.A. ##.................................... 50,500 2,153
AXA S.A. ## +.................................... 700,921 11,820
BNP Paribas ##................................... 161,068 8,578
Bouygues S.A. +.................................. 64,500 2,775
Carrefour S.A. ## +.............................. 208,060 8,504
Compagnie Generale des Etablissements
Michelin ## +................................. 90,220 4,655
Credit Agricole S.A.............................. 530,773 7,865
EDF.............................................. 76,785 3,587
France Telecom S.A............................... 717,877 16,023
GDF Suez +....................................... 130,800 4,725
Groupe Danone +.................................. 42,300 2,022
Sanofi-Aventis S.A. +............................ 443,282 25,671
Technip S.A. +................................... 269,169 11,701
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Total S.A........................................ 431,237 $ 21,878
VINCI S.A. +..................................... 246,269 11,144
Vivendi S.A. ## +................................ 264,220 7,156
----------
TOTAL FRANCE........................................ 150,257
----------
GERMANY - 11.87%
COMMON STOCKS - 11.30%
adidas AG +...................................... 64,600 2,446
Allianz SE +..................................... 56,602 5,223
Bayer AG ## +.................................... 98,969 4,925
Bayerische Motoren Werke AG...................... 178,770 6,209
Celesio AG +..................................... 245,480 5,453
Daimler AG....................................... 68,400 2,457
Deutsche Post AG................................. 1,286,985 14,899
E.ON AG +........................................ 808,982 27,444
Linde AG ## +.................................... 90,661 7,237
Merck KGaA....................................... 81,740 7,349
Muenchener Rueckversicherungs-Gesellschaft
AG +.......................................... 45,297 6,271
SAP AG........................................... 140,910 5,411
Siemens AG....................................... 437,558 29,543
----------
TOTAL COMMON STOCKS................................. 124,867
----------
PREFERRED STOCKS - 0.57%
Henkel AG & Co. KGaA +........................... 231,222 6,281
----------
TOTAL GERMANY....................................... 131,148
----------
GREECE - 1.22%
COMMON STOCKS - 1.22%
OPAP S.A......................................... 289,765 8,987
Public Power Corp. S.A........................... 228,870 4,442
----------
TOTAL GREECE........................................ 13,429
----------
HONG KONG/CHINA - 1.50%
COMMON STOCKS - 1.50%
Cheung Kong Holdings Ltd......................... 472,500 4,963
Hutchison Whampoa Ltd............................ 187,000 1,105
Swire Pacific Ltd................................ 622,100 4,884
Yue Yuen Industrial Holdings Ltd................. 2,537,667 5,645
----------
TOTAL HONG KONG/CHINA............................... 16,597
----------
IRELAND - 0.82%
COMMON STOCKS - 0.82%
C&C Group plc.................................... 1,138,147 2,624
CRH plc, ADR..................................... 167,632 4,407
Smurfit Kappa Group plc.......................... 688,413 2,015
----------
TOTAL IRELAND....................................... 9,046
----------
See accompanying notes
15
AMERICAN BEACON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
ITALY - 2.52%
COMMON STOCKS - 2.52%
Atlantia S.p.A ##................................ 157,900 $ 2,806
Eni S.p.A........................................ 486,151 10,581
Finmeccanica SpA ##.............................. 275,110 3,906
Intesa Sanpaolo S.p.A ##......................... 824,480 2,659
Mediaset S.p.A. ##............................... 923,190 5,225
UniCredit S.p.A. ##.............................. 1,086,667 2,687
----------
TOTAL ITALY......................................... 27,864
----------
JAPAN - 14.17%
COMMON STOCKS - 14.17%
Aeon Co. Ltd. +.................................. 695,800 5,419
Canon, Inc....................................... 158,200 4,732
Central Japan Railway Co......................... 544 3,216
Chiyoda Corp..................................... 426,000 2,536
Chuo Mitsui Trust Holdings, Inc.................. 1,093,400 3,559
Daito Trust Construction Co. Ltd................. 104,900 4,350
Fanuc Ltd........................................ 118,400 8,488
FUJIFILM Holdings Corp........................... 107,900 2,735
Haseko Corp. ##.................................. 4,226,018 2,657
Honda Motor Co. Ltd.............................. 157,700 4,549
HOYA Corp........................................ 149,400 2,571
INPEX Corp....................................... 335 2,116
Japan Tobacco, Inc............................... 1,360 3,406
JS Group Corp.................................... 308,100 3,749
KDDI Corp........................................ 1,792 8,032
Keyence Corp. ##................................. 5,900 1,039
Konica Minolta Holdings, Inc..................... 347,500 2,826
Kurita Water Industries Ltd. ##.................. 67,300 1,624
Mitsubishi Corp.................................. 182,200 2,790
Mitsubishi Estate Co. Ltd........................ 156,000 2,030
Mitsubishi Gas Chemical Co., Inc................. 859,000 3,981
Mitsubishi UFJ Financial Group, Inc.............. 1,726,700 9,367
NGK Spark Plug Co. Ltd. +........................ 541,000 5,200
Nintendo Co. Ltd................................. 11,400 3,041
Nomura Research Institute Ltd.................... 134,300 2,375
Olympus Corp. +.................................. 52,800 857
Sankyo Co. Ltd................................... 110,800 5,595
Secom Co. Ltd.................................... 93,400 3,447
Shin-Etsu Chemical Company Ltd................... 106,900 5,160
Sony Corp........................................ 118,902 3,050
Sony Financial Holdings, Inc..................... 2,609 8,175
Sumitomo Mitsui Financial Group, Inc............. 110,300 3,803
T&D Holdings, Inc................................ 34,950 1,035
Takeda Pharmaceutical Co. Ltd.................... 74,900 2,658
Tokio Marine Holdings, Inc....................... 43,900 1,155
Tokyo Electron Ltd............................... 216,900 9,853
Tokyo Gas Co. Ltd. ##............................ 332,000 1,259
Toyota Motor Corp. ##............................ 280,700 10,958
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Yamaha Motor Co. Ltd............................. 304,400 $ 3,201
----------
TOTAL JAPAN......................................... 156,594
----------
NETHERLANDS - 5.24%
COMMON STOCKS - 5.24%
Akzo Nobel N.V. +................................ 207,557 8,760
ASML Holding N.V................................. 401,720 8,270
ING Groep N.V. ##................................ 379,330 3,556
Koninklijke Philips Electronics N.V. ##.......... 707,136 12,874
Randstad Holding N.V. ## +....................... 55,060 1,271
Reed Elsevier N.V................................ 409,961 4,534
SBM Offshore N.V. ## +........................... 258,280 4,203
TNT N.V.......................................... 465,355 8,657
Unilever N.V..................................... 292,965 5,824
----------
TOTAL NETHERLANDS................................... 57,949
----------
NORWAY - 0.87%
COMMON STOCKS - 0.87%
Aker Solutions ASA............................... 783,350 4,814
Stolt-Nielsen S.A................................ 88,384 781
Telenor ASA ##................................... 640,840 4,022
----------
TOTAL NORWAY........................................ 9,617
----------
PORTUGAL - 0.52%
COMMON STOCKS - 0.52%
Portugal Telecom, SGPS, S.A. +................... 747,760 5,748
----------
SINGAPORE - 2.66%
COMMON STOCKS - 2.66%
DBS Group Holdings Ltd........................... 2,483,182 15,934
Flextronics International Ltd. ##................ 848,510 3,292
Singapore Telecommunications Ltd................. 5,892,000 10,188
----------
TOTAL SINGAPORE..................................... 29,414
----------
SOUTH KOREA - 1.18%
COMMON STOCKS - 1.18%
Hyundai Heavy Industries......................... 49,183 8,817
KB Financial Group, Inc., ADR ## +............... 132,710 4,231
----------
TOTAL SOUTH KOREA................................... 13,048
----------
SPAIN - 2.51%
COMMON STOCKS - 2.51%
Banco Santander S.A.............................. 361,009 3,473
Banco Santander S.A., GDR ##..................... 400,828 3,688
Enagas S.A. ##................................... 100,485 1,759
Repsol YPF S.A................................... 257,990 4,939
Telefonica S.A. ##............................... 726,270 13,847
----------
TOTAL SPAIN......................................... 27,706
----------
See accompanying notes
16
AMERICAN BEACON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
SWEDEN - 1.80%
COMMON STOCKS - 1.80%
Atlas Copco AB +................................. 645,240 $ 6,076
Nordea Bank AB................................... 582,370 4,276
Telefonaktiebolaget LM Ericsson ## +............. 1,082,375 9,553
----------
TOTAL SWEDEN........................................ 19,905
----------
SWITZERLAND - 7.34%
COMMON STOCKS - 7.34%
Adecco S.A. ##................................... 130,550 5,172
Credit Suisse Group AG........................... 178,066 6,958
Julius Baer Holdings............................. 126,800 4,222
Lonza Group AG +................................. 52,740 4,861
Nestle S.A. +.................................... 286,838 9,389
Novartis AG...................................... 327,330 12,447
Richemont S.A. ##................................ 319,086 5,759
Roche Holding AG................................. 56,180 7,113
Swiss Reinsurance................................ 100,960 2,431
UBS AG ##........................................ 853,789 11,932
Zurich Financial Services AG..................... 57,666 10,822
----------
TOTAL SWITZERLAND................................... 81,106
----------
UNITED KINGDOM - 20.17%
COMMON STOCKS - 20.17%
Anglo American plc ##............................ 325,770 7,152
Aviva plc........................................ 1,874,344 8,748
BAE Systems plc.................................. 3,465,085 18,364
BG Group plc..................................... 145,400 2,351
BP plc........................................... 2,655,249 18,953
British American Tobacco plc ##.................. 299,558 7,263
British Sky Broadcasting Group plc............... 863,040 6,215
Cadbury plc...................................... 499,764 3,752
Cairn Energy plc ##.............................. 34,200 1,084
Centrica plc..................................... 1,359,965 4,567
Compass Group plc................................ 735,520 3,526
GlaxoSmithKline plc.............................. 1,131,896 17,565
HSBC Holdings plc................................ 2,921,544 20,715
Imperial Tobacco Group plc....................... 203,210 4,663
Kingfisher plc................................... 1,256,400 3,459
Michael Page International ##.................... 546,569 2,232
National Grid plc................................ 228,981 1,912
Pearson plc...................................... 534,980 5,591
Prudential plc................................... 702,300 4,086
Reckitt Benckiser Group plc...................... 59,800 2,359
Rio Tinto plc.................................... 97,200 3,989
Rolls-Royce Group plc C Shares Entitlement
Jul. 09 ## ++................................. 87,828,312 130
Rolls-Royce Group plc............................ 1,023,640 5,118
Royal Dutch Shell plc, A Shares +................ 334,822 7,784
Royal Dutch Shell plc, B Shares.................. 581,659 13,398
SHARES VALUE
------------ ----------
(DOLLARS IN THOUSANDS)
Smith Nephew ##.................................. 429,240 $ 3,051
Smiths Group plc ##.............................. 275,620 2,991
Standard Chartered plc........................... 167,390 2,620
Tesco plc........................................ 615,900 3,072
Unilever plc..................................... 521,061 10,221
Vodafone Group plc............................... 14,106,744 26,023
----------
TOTAL UNITED KINGDOM................................ 222,954
----------
UNITED STATES - 0.13%
COMMON STOCKS - 0.13%
News Corp........................................ 172,040 1,421
----------
SHORT TERM INVESTMENTS - 4.68%
American Beacon U.S. Government Money
Market Select Fund #.......................... 10,000,000 10,000
Columbia Government Reserve Fund................. 41,722,418 41,722
----------
TOTAL SHORT TERM INVESTMENTS........................ 51,722
----------
SECURITIES LENDING
COLLATERAL - 18.65%
JP Morgan U.S. Government Money Market
Fund.......................................... 103,053,049 103,053
Wells Fargo Advantage Government Money
Market Fund................................... 103,053,049 103,053
----------
TOTAL SECURITIES LENDING COLLATERAL.............. 206,106
----------
TOTAL INVESTMENTS 116.40% - (COST $1,509,234)....... 1,286,316
LIABILITIES, NET OF OTHER ASSETS - (16.40%)......... (181,213)
----------
TOTAL NET ASSETS - 100.00%.......................... $1,105,103
==========
See accompanying notes
17
AMERICAN BEACON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
++ Valued at fair value pursuant to procedures approved by the Board of
Trustees.
# The Fund is affiliated by having the same investment advisor.
FUTURES CONTRACTS
(DOLLARS IN THOUSANDS)
UNREALIZED
NUMBER OF EXPIRATION MARKET APPRECIATION/
CONTRACTS DATE VALUE (DEPRICIATION)
--------- ---------- ------- --------------
Australia SPI Index ............... 75 Jun 2009 $ 5,188 $ 176
Canada S&PCDA 60 Index ........... 77 Jun 2009 7,309 391
France CAC 40 Index .............. 190 Jun 2009 7,729 787
Germany DAX Index ................ 39 Jun 2009 6,200 732
Hang Seng Index .................. 21 May 2009 2,085 91
Italy MIB 30 Index ............... 24 Jun 2009 2,976 459
Netherlands 200 AEX Index ........ 32 May 2009 2,039 44
Spain IBEX 35 Index .............. 29 May 2009 3,418 79
Sweden OMX Index ................. 223 May 2009 2,103 63
Tokyo FE TOPIX Index ............. 198 Jun 2009 16,925 677
UK FTSE 100 Index ................ 230 Jun 2009 14,338 1,090
------- ------
$70,310 $4,589
======= ======
See accompanying notes
18
AMERICAN BEACON INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
(DOLLARS IN THOUSANDS)
SETTLEMENT MARKET UNREALIZED
DATE VALUE GAIN/(LOSS)
---------- ------- ---------------
CONTRACTS TO DELIVER
2,450 Australian Dollar ............................. 6/19/2009 $1,775 $ (39)
3,066 Canadian Dollar ............................... 6/19/2009 2,570 (76)
5,720 Euro Currency ................................. 6/19/2009 7,567 53
614,776 Japanese Yen .................................. 6/19/2009 6,237 (44)
3,732 Pound Sterling ................................ 6/19/2009 5,521 (10)
5,251 Swedish Krona ................................. 6/19/2009 653 (5)
2,085 Swiss Franc ................................... 6/19/2009 1,828 0
TOTAL CONTRACTS TO DELIVER ------- ------
(RECEIVABLE AMOUNT $26,030) $26,151 $ (121)
------- ------
CONTRACTS TO RECEIVE
8,053 Australian Dollar ............................. 6/19/2009 $ 5,835 $ 432
9,129 Canadian Dollar ............................... 6/19/2009 7,652 425
17,219 Euro Currency ................................. 6/19/2009 22,778 281
2,345,366 Japanese Yen .................................. 6/19/2009 23,797 (153)
11,257 Pound Sterling ................................ 6/19/2009 16,652 684
15,117 Swedish Krona ................................. 6/19/2009 1,879 84
7,895 Swiss Franc ................................... 6/19/2009 6,922 117
TOTAL CONTRACTS TO RECEIVE ------- ------
(PAYABLE AMOUNT $83,645) $85,515 $1,870
------- ------
Net Currency Fluctuation $1,749
======
SECTOR DIVERSIFICATION
Percent of
Net Assets
----------
Consumer Discretionary ....................................... 12.65%
Consumer Staples ............................................. 6.42%
Energy ....................................................... 9.74%
Financials ................................................... 18.50%
Health Care .................................................. 7.64%
Industrials .................................................. 14.87%
Information Technology ....................................... 5.56%
Materials .................................................... 5.05%
Telecommunication Services ................................... 8.57%
Utilities .................................................... 4.07%
Short Term Investments ....................................... 23.33%
Liabilities, Net of Other Assets ............................. ------
100.00%
======
See accompanying notes
19
AMERICAN BEACON FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 2009 (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
EMERGING
MARKETS INTERNATIONAL
FUND EQUITY FUND
---------- -------------
ASSETS:
Investments in unaffiliated securities, at value (A, D) ................ $ 102,456 $ 1,276,316
Investments in affiliated securities, at value (B) ..................... 2,351 10,000
Foreign currency, at value (C) ......................................... 920 7,729
Cash ................................................................... -- 1,109
Deposit with brokers for futures contracts ............................. -- 11,330
Receivable for investments sold ........................................ 809 8,180
Dividends and interest receivable ...................................... 349 6,273
Receivable for fund shares sold ........................................ 12 1,093
Receivable for tax reclaims ............................................ 5 483
Receivable for variation margin on open futures contracts .............. 8 1,186
Net unrealized appreciation on foreign currency contracts .............. -- 1,749
Prepaid expenses ....................................................... 18 56
Other assets ........................................................... -- 41
---------- -----------
TOTAL ASSETS ........................................................ 106,928 1,325,545
---------- -----------
LIABILITIES:
Payable for investments purchased ...................................... 845 10,040
Payable upon return of securities loaned ............................... 10,952 207,215
Payable for fund shares redeemed ....................................... 42 1,653
Management and investment advisory fees payable (Note 2) ............... 195 952
Administrative service and service fees payable ........................ 6 296
Other liabilities ...................................................... 13 286
---------- -----------
TOTAL LIABILITIES ................................................... 12,053 220,442
---------- -----------
NET ASSETS ................................................................ $ 94,875 $ 1,105,103
========== ===========
ANALYSIS OF NET ASSETS:
Paid-in-capital ........................................................... 137,005 1,546,766
Undistributed net investment income ....................................... 193 17,636
Accumulated net realized (loss) ........................................... (34,491) (243,003)
Unrealized (depreciation) of investments, futures contracts, and foreign
currency ............................................................... (7,832) (216,296)
---------- -----------
NET ASSETS ................................................................ $ 94,875 $ 1,105,103
========== ===========
Shares outstanding (no par value):
Institutional Class .................................................... 732,681 34,055,209
========== ===========
Investor Class ......................................................... 661,759 30,894,856
========== ===========
Advisor Class .......................................................... N/A 136,674
========== ===========
AMR Class .............................................................. 9,670,433 27,797,490
========== ===========
Net asset value, offering and redemption price per share:
Institutional Class .................................................... $ 8.55 $ 11.93
========== ===========
Investor Class ......................................................... $ 8.43 $ 11.79
========== ===========
Advisor Class .......................................................... N/A $ 11.73
========== ===========
AMR Class .............................................................. $ 8.59 $ 11.99
========== ===========
(A) Cost of investments in unaffiliated securities ........................ $ 111,113 $ 1,499,234
(B) Cost of investments in affiliated securities .......................... $ 2,351 $ 10,000
(C) Cost of foreign currency .............................................. $ 908 $ 7,693
(D) Market value of securities on loan .................................... $ 10,512 $ 196,972
See accompanying notes
20
AMERICAN BEACON FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 2009 (UNAUDITED) (IN THOUSANDS)
EMERGING
MARKETS INTERNATIONAL
FUND EQUITY FUND
-------- -------------
INVESTMENT INCOME:
Dividend income from unaffiliated securities (net of foreign
taxes) (A) .......................................................... $ 831 $ 20,617
Dividend income from affiliated securities ............................. 7 42
Interest income ........................................................ 3 30
Income derived from securities lending, net ............................ 89 531
-------- ---------
TOTAL INVESTMENT INCOME .......................................... 930 21,220
-------- ---------
EXPENSES:
Management and investment advisory fees (Note 2) ....................... 308 1,756
Administrative service fees (Note 2):
Institutional Class ................................................. 8 652
Investor Class ...................................................... 7 540
Advisor Class ....................................................... -- 2
AMR Class ........................................................... 18 77
Transfer agent fees:
Institutional Class ................................................. -- 27
Investor Class ...................................................... 2 21
Advisor Class ....................................................... -- 1
AMR Class ........................................................... 3 12
Custody and fund accounting fees ....................................... 210 167
Professional fees ...................................................... 27 35
Registration fees and expenses ......................................... 14 35
Service fees (Note 2):
Investor Class ...................................................... 6 460
Advisor Class ....................................................... -- 2
Distribution fees- Advisor Class (Note 2) .............................. -- 2
Prospectus and shareholder reports ..................................... 5 147
Trustee fees ........................................................... 2 33
Other expenses ......................................................... 43 141
-------- ---------
TOTAL EXPENSES ................................................... 653 4,110
-------- ---------
NET INVESTMENT INCOME ..................................................... 277 17,110
-------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from: (B)
Investments ......................................................... (15,601) (189,872)
Commission recapture (Note 1) ....................................... -- 33
Foreign currency transactions ....................................... (4,409) (25,838)
Futures contracts ................................................... (2,208) (24,231)
Change in net unrealized appreciation or depreciation of:
Investments ......................................................... 27,823 134,358
Foreign currency translations ....................................... 4,228 30,760
Futures contracts ................................................... 2,131 21,382
-------- ---------
NET GAIN (LOSS) ON INVESTMENTS ................................... 11,964 (53,408)
-------- ---------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS ........... $ 12,241 $ (36,298)
======== =========
(A) Foreign taxes ......................................................... $ 95 $ 1,964
(B) Net of foreign withholding taxes on capital gains ..................... $ 2 $ --
See accompanying notes
21
AMERICAN BEACON FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (IN THOUSANDS)
Emerging Markets Fund International Equity Fund
------------------------ ---------------------------
Six Months
Ended Year Ended Six Months Year Ended
April 30, October 31, Ended October 31,
2009 2008 April 30, 2009 2008
----------- ----------- -------------- -----------
(unaudited) (unaudited)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income .................................................. $ 277 $ 2,837 $ 17,110 $ 71,599
Net realized gain (loss) on investments, futures contracts, and foreign
currency transactions ............................................... (22,218) 1,673 (239,908) 33,063
Change in net unrealized appreciation or depreciation of investments,
futures contracts, and foreign currency translations ................ 34,182 (133,877) 186,500 (1,329,781)
-------- --------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS .................................................... 12,241 (129,367) (36,298) (1,225,119)
-------- --------- ---------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Institutional Class ................................................. (129) (58) (22,416) (40,937)
Investor Class ...................................................... (93) (43) (17,116) (20,913)
Advisor Class ....................................................... -- -- (61) (105)
AMR Class ........................................................... (2,146) (2,023) (17,313) (18,454)
Net realized gain on investments:
Institutional Class ................................................. (798) (2,019) (12,166) (155,609)
Investor Class ...................................................... (756) (1,876) (10,088) (87,859)
Advisor Class ....................................................... -- -- (40) (482)
AMR Class ........................................................... (11,267) (39,911) (8,489) (63,681)
-------- --------- ---------- -----------
NET DISTRIBUTIONS TO SHAREHOLDERS ................................ (15,189) (45,930) (87,689) (388,040)
-------- --------- ---------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from sales of shares .......................................... 10,727 28,155 145,312 443,828
Reinvestment of dividends and distributions ............................ 15,153 45,849 81,731 366,395
Cost of shares redeemed ................................................ (11,243) (112,884) (321,599) (1,148,081)
Redemption fees ........................................................ 9 161 130 868
-------- --------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE
TRANSACTIONS .................................................. 14,646 (38,719) (94,426) (336,990)
-------- --------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS ..................................... 11,698 (214,016) (218,413) (1,950,149)
-------- --------- ---------- -----------
NET ASSETS:
Beginning of period .................................................... 83,177 297,193 1,323,516 3,273,665
-------- --------- ---------- -----------
END OF PERIOD * ........................................................ $ 94,875 $ 83,177 $1,105,103 $ 1,323,516
======== ========= ========== ===========
*Includes undistributed net investment income (loss) of ................... $ 193 $ 2,109 $ 17,636 $ 70,764
======== ========= ========== ===========
See accompanying notes
22
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
American Beacon Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, (the "Act") as a diversified, open-end management investment company.
These financial statements and notes to the financial statements relate to the
American Beacon Emerging Market and International Equity Funds (the "Funds"), a
series of the Trust.
American Beacon Advisors, Inc. (the "Manager") is a wholly-owned subsidiary
of Lighthouse Holdings, Inc. and was organized in 1986 to provide business
management, advisory, administrative and asset management consulting services to
the Trust and other investors.
Class Disclosure
Prior to March 1, 2009, the Investor and Advisor Classes were formerly
known as the PlanAhead and Service Classes, respectively.
The Funds have multiple classes of shares designed to meet the needs of
different groups of investors. The following table sets forth the differences
amongst the classes:
CLASS: OFFERED TO:
- ------ -----------
INSTITUTIONAL CLASS Investors making an initial investment of $2 million
INVESTOR CLASS General public and investors investing through an
intermediary
ADVISOR CLASS Investors investing through an intermediary
AMR CLASS Investors in the tax-exempt retirement and benefit plans
of AMR Corporation and its affiliates
Administrative service fees, service fees and distribution fees vary
amongst the classes as described more fully in footnote 2.
Investment income, net capital gains (losses) and all expenses incurred by
the Funds are allocated based on the relative net assets of each class, except
for service fees and certain other fees and expenses related solely to one class
of shares.
Security Valuation
Investments are valued at the close of the New York Stock Exchange (the
"Exchange"), normally 4 p.m. ET, each day that the Exchange is open for
business. Equity securities for which market quotations are available are valued
at the last sale price or official closing price (closing bid price or last
evaluated quote if no sale has occurred) on the primary market or exchange on
which they trade.
Debt securities (other than short-term securities) normally are valued on
the basis of prices provided by an independent pricing service and may take into
account appropriate factors such as institution-size trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data. The prices of debt securities may be
determined using quotes obtained from brokers.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation. Investment grade short-term
obligations with 60 days or less to maturity are valued using the amortized cost
method, which approximates market value.
Securities for which market prices are not readily available or are not
reflective of the fair value of the security, as determined by the Manager, will
be priced at fair value following procedures approved by the Board of Trustees
(the "Board").
23
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Most foreign markets close before the Exchange. Developments that could
affect the values of securities that occur between the close of a foreign market
and the close of the Exchange normally will not be reflected in security
valuations. If such developments are so significant that they will, in the
judgment of the pricing committee of the Fund, clearly and materially affect the
value of securities, the foreign market closing prices may be adjusted to
reflect the fair value of the securities as of the close of the Exchange, as
determined in good faith and pursuant to procedures approved by the Board.
Adjustments to closing prices to reflect fair value on affected foreign
securities may be provided by an independent pricing service.
The Funds adopted the provisions of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective with the
beginning of the Fund's fiscal year. The standard clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires additional disclosures about the use of fair value
measurements. The three levels of the hierarchy under FAS 157 are described
below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Prices determined using other significant observable inputs.
These may include quoted prices for similar securities, interest rates,
prepayment speeds, credit risk, and others.
Level 3 - Prices determined using other significant unobservable inputs.
Unobservable inputs reflect the Fund's own assumptions about the factors
market participants would use in pricing an investment, and would be based
on the best information available.
A summary of the inputs used to value the Funds' investments as of April 30,
2009 is as follows (in thousands):
Emerging Markets
Investments in Other Financial
Valuation Inputs Securities Instruments*
---------------- --------------- ---------------
Level 1 - Quoted prices....................................... $103,357 $816
Level 2 - Other significant observable inputs................. 1,105 --
Level 3 - Significant unobservable inputs.................... 345 --
-------- ----
Total......................................................... $104,807 $816
-------- ----
International Equity
Investments in Other Financial
Valuation Inputs Securities Instruments*
---------------- -------------- ---------------
Level 1 - Quoted prices....................................... $1,286,186 $4,589
Level 2 - Other significant observable inputs................. -- 1,749
Level 3 - Significant unobservable inputs..................... 130
---------- ------
Total......................................................... $1,286,316 $6,338
---------- ------
* Other financial instruments are futures and foreign currency exchange
contracts.
The following is a reconciliation of investments in which significant
unobservable inputs (Level 3) were used in determining fair value: (in
thousands)
EMERGING MARKETS INTERNATIONAL EQUITY
Investments in Investments in
Securities Securities
---------------- --------------------
Balance as of 10/31/08...................................... $ -- $ --
Transfers in................................................ 449 128
Change in unrealized appreciation/(depreciation)............ (104) 2
----- ----
Balance as of 4/30/09....................................... $ 345 $130
----- ----
The amount of total unrealized appreciation / (depreciation) on investments
in level 3 securities still held at April 30, 2009 was $(301) and $2,for the
Emerging and International Equity Funds, respectively, which is included in the
Statements of Operations as part of the net change in unrealized appreciation
(depreciation on investments.
24
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Security Transactions and Investment Income
Security transactions are recorded on the trade date of the security
purchase or sale.
The Funds may purchase securities with delivery or payment to occur at a
later date. At the time the Funds enter into a commitment to purchase a
security, the transaction is recorded, and the value of the security is
reflected in the net asset value. The value of the security may vary with market
fluctuations.
Dividend income, net of foreign taxes, is recorded on the ex-dividend date
except certain dividends from foreign securities which are recorded as soon as
the information is available to the Funds. Interest income is earned from
settlement date, recorded on the accrual basis, and adjusted, if necessary, for
accretion of discounts and amortization of premiums. For financial and tax
reporting purposes, realized gains and losses are determined on the basis of
specific lot identification.
Currency Translation
All assets and liabilities initially expressed in foreign currency values
are converted into U.S. dollar values at the mean of the bid and ask prices of
such currencies against U.S. dollars as last quoted by a recognized dealer.
Income, expenses and purchases and sales of investments are translated into U.S.
dollars at the rate of exchange prevailing on the respective dates of such
transactions. The effect of changes in foreign currency exchange rates on
investments is separately identified from the fluctuations arising from changes
in market values of securities held and is reported with all other foreign
currency gains and losses in the Funds' Statements of Operations.
Forward Foreign Currency Contracts
The Funds may enter into forward foreign currency contracts to hedge the
exchange rate risk on investment transactions or to hedge the value of Funds
securities denominated in foreign currencies. Forward foreign currency contracts
are valued at the forward exchange rate prevailing on the day of valuation. The
Funds bear the market risk that arises from changes in foreign exchange rates,
and accordingly, the unrealized gain (loss) on these contracts is reflected in
the accompanying financial statements. The Funds also bear the credit risk if
the counterparty fails to perform under the contract.
Futures Contracts
Futures contracts are contracts to buy or sell a standard quantity of
securities at a specified price on a future date. The Funds may enter into
financial futures contracts as a method for keeping assets readily convertible
to cash if needed to meet shareholder redemptions or for other needs while
maintaining exposure to the stock or bond market, as applicable. The primary
risks associated with the use of futures contracts are the possibility of
illiquid markets or imperfect correlation between the values of the contracts
and the underlying securities, or that the counterparty will fail to perform its
obligations.
Upon entering into a futures contract, the Funds are required to set aside
or deposit with a broker an amount, termed the initial margin, which typically
represents 5% of the face value of the futures contract. The initial margin
amount is reflected as a Deposit with broker for futures contracts on the
Statements of Assets and Liabilities. Payments to and from the broker, known as
variation margin, are required to be made on a daily basis as the price of the
futures contract fluctuates. Changes in initial settlement values are accounted
for as unrealized appreciation (depreciation) until the contracts are
terminated, at which time realized gains and losses are recognized. Futures
contracts are valued at the most recent settlement price established each day by
the exchange on which they are traded.
25
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Dividends to Shareholders
Dividends from net investment income of the Funds normally will be declared
and paid at least annually. Distributions, if any, of net realized capital gains
are generally paid at least annually and recorded on the ex-dividend date.
Commission Recapture
The Funds have established brokerage commission recapture arrangements with
certain brokers or dealers. If the Funds' investment advisor chooses to execute
a transaction through a participating broker, the broker rebates a portion of
the commission back to the Funds. Any collateral benefit received through
participation in the commission recapture program is directed exclusively to the
Funds. This amount is reported with the net realized gain in the Funds'
Statements of Operations.
Allocation of Income, Expenses, Gains and Losses
Income, expenses (other than those attributable to a specific class), gains
and losses are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses directly
attributable to a specific class are charged against the operations of that
class.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimated.
Redemption Fees
The Funds impose a 2% redemption fee on shares held for less than 90 days.
The fee is deducted from the redemption proceeds and is intended to offset the
trading costs, market impact and other costs associated with short-term trading
activity in the Funds. The "first-in, first-out" method is used to determine the
holding period. The fee is allocated to all classes of the Funds pro-rata based
on their respective net assets.
Recently Issued Accounting Pronouncements
In March 2008, FASB issued Statement of Financial Accounting Standards No.
161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"), which is effective for fiscal years and interim periods beginning after
November 15, 2008. FAS 161 requires enhanced disclosures about derivative and
hedging activities, including how such activities are accounted for and their
effect on financial positions, performance and cash flows. The Manager is
currently evaluating the impact the adoption of FAS 161 will have on the Funds'
financial statements and related disclosures.
Other
Under the Trust's organizational documents, its officers and directors are
indemnified against certain liability arising out of the performance of their
duties to the Trust. In the normal course of business, the Trust enters into
contracts that provide indemnification to the other party or parties against
potential costs or liabilities. The Trust's maximum exposure under these
arrangements is dependent on claims that may be made in the future and,
therefore, cannot be estimated. The Trust has had no prior claims or losses
pursuant to any such agreement.
26
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
2. TRANSACTIONS WITH AFFILIATES
Management Agreement
The Trust and the Manager are parties to a Management Agreement that
obligates the Manager to provide or oversee the provision of all administrative,
investment advisory, fund management and securities lending services. Investment
assets of the Funds are managed by multiple investment advisors that have
entered into separate investment advisory agreements with the Manager. As
compensation for performing the duties required under the Management Agreement,
the Manager receives from the Funds an annualized fee equal to 0.05% of the
average daily net assets plus amounts paid by the Manager to the investment
advisors hired by the Manager to direct investment activities of the Funds.
Management fees paid during the six months ended April 30, 2009 were as follows
(dollars in thousands):
AMOUNTS PAID TO NET AMOUNTS
MANAGEMENT MANAGEMENT INVESTMENT RETAINED BY
FEE RATE FEE ADVISORS MANAGER
----------- ---------- --------------- -----------
Emerging Markets............. 0.60%-1.15% $ 308 $ 287 $ 21
International Equity......... 0.25%-0.55% $1,756 $1,480 $276
As compensation for services provided by the Manager in connection with
securities lending activities, the Fund pays to the Manager, with respect to
cash collateral posted by borrowers, a fee up to 25% of the net monthly interest
income (the gross interest income earned by the investment of cash collateral,
less the amount paid to borrowers and related expenses) from such activities
and, with respect to loan fees paid by borrowers when a borrower posts
collateral other than cash, a fee up to 25% of such loan fees. This fee is
netted against securities lending income in the Statements of Operations. During
the six months ended April 30, 2009 securities lending fees paid to the Manager
on behalf of the Emerging Markets and International Equity Funds were $12,398
and $119,704, respectively.
Administrative Services Agreement
The Manager and the Trust entered into an Administrative Services Agreement
which obligates the Manager to provide or oversee administrative services to the
Funds. As compensation for performing the duties required under the
Administrative Services Agreement, the Manager receives an annualized fee of
0.30% of the average daily net assets of the Institutional, Investor, and
Advisor Classes and 0.05% of the average daily net assets of the AMR Classes of
the Funds.
Distribution Plans
The Funds, except for the Advisor Class of the Funds, has adopted a
"defensive" Distribution Plan (the "Plan") in accordance with Rule 12b-1 under
the Act, pursuant to which no fees may be charged to the Funds for distribution
purposes. However, the Plan authorizes the management and administrative service
fees received by the Manager and the investment advisors hired by the Manager to
be used for distribution purposes. Under this Plan, the Funds do not intend to
compensate the Manager or any other party, either directly or indirectly, for
the distribution of Funds shares.
A separate Distribution Plan (the "Distribution Plan") has been adopted
pursuant to Rule 12b-1 under the Act for the Advisor Class of the Funds. Under
the Distribution Plan, as compensation for distribution assistance, the Manager
receives an annual fee of 0.25% of the average daily net assets of the Advisor
Class. The fee will be payable without regard to whether the amount of the fee
is more or less than the actual expenses incurred in a particular month by the
Manager for distribution assistance.
27
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Service Plans
The Manager and the Trust entered into Service Plans that obligate the
Manager to oversee additional shareholder servicing of the Investor and Advisor
Classes. As compensation for performing the duties required under the Service
Plans, the Manager receives up to 0.375% of the average daily net assets of the
Investor Classes and 0.25% of the average daily net assets of the Advisor
Classes of the Funds.
Brokerage Commissions
Affiliated entities of an investment advisor to the Funds received net
commissions on purchases and sales of the Funds' portfolio securities totaling
$403 and $2,420 for the Emerging Markets and International Equity Funds,
respectively for the six months ended April 30, 2009.
Investment in Affiliated Funds
The Funds may invest in the American Beacon Money Market Select Fund (the
"MM Select Fund") and the American Beacon U.S. Government Money Market Select
Fund (the "USG Select Fund") (collectively the "Select Funds"). Cash collateral
received by the Funds in connection with securities lending may be invested in
the Select Funds. The Funds and the Select Funds have the same investment
advisor and therefore, are considered to be affiliated. The Manager serves as
investment advisor to the Select Funds and receives from the Select Funds an
annualized management fee of 0.09% of the average daily net assets of the Select
Funds. During the six months ended April 30, 2009, fees earned by the Manager
from the Select Funds were as follows:
SECURITIES LENDING
DIRECT INVESTMENTS IN COLLATERAL INVESTED
SELECT FUNDS IN SELECT FUNDS TOTAL
--------------------- ------------------- ------
Emerging Market Fund................ $ 594 $1,032 $1,627
International Equity Fund........... 3,015 -- 3,015
Interfund Lending Program
Pursuant to an exemptive order by the Securities and Exchange Commission
(the "SEC"), the Funds, along with other registered investment companies having
management contracts with the Manager, may participate in an interfund lending
program as a borrower. This program provides an alternative credit facility
allowing the Funds to borrow from other participating Funds. For the six months
ended April 30, 2009, the Funds did not utilize the credit facility.
Expense Reimbursement Plan
The Funds have adopted an Expense Reimbursement Plan whereby the Manager
may seek repayment of fees waived or expenses reimbursed for a period of up to
three years. However, reimbursement will occur only if the Class' average net
assets have grown or expenses have declined sufficiently to allow reimbursement
without causing its expense ratio to exceed the previously agreed upon
contractual expense limit. During the six months ended April 30, 2009, there
were no additional waived fees or reimbursed expenses subject to potential
recovery.
3. FEDERAL INCOME AND EXCISE TAXES
It is the policy of the Fund to comply with the requirements of Subchapter
M of the Internal Revenue Code and to distribute substantially all net
investment income as well as any net realized capital gains on the sale of
investments. Therefore, no federal income or excise tax provision is required.
The Fund adopted the provisions of FASB Interpretation No. 48, "Accounting
for Uncertainties in Income Taxes" ("FIN48"), on January 1, 2007. FIN 48 sets
forth a minimum threshold for financial statement
28
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
recognition of the benefit of a tax position taken or expected to be taken in a
tax return. The implementation of FIN 48 did not result in any unrecognized tax
benefits in the accompanying financial statements. Each of the tax years in the
three year period ended October 31, 2008 remains subject to examination by the
Internal Revenue Service. If applicable, the Fund recognizes interest accrued
related to unrecognized tax benefits in interest expense and penalties in "Other
expenses" on the Statement of Operations.
Dividends are categorized in accordance with income tax regulations which
may treat certain transactions differently than U.S. generally accepted
accounting principles. Accordingly, the character of distributions and
composition of net assets for tax purposes may differ from those reflected in
the accompanying financial statements.
The tax character of distributions paid during the six months ended April
30, 2009 and the year ended October 31, 2008 were as follows (in thousands):
EMERGING MARKETS INTERNATIONAL EQUITY
-------------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2009 2008 2009 2008
---------------- ------------- ---------------- -----------
DISTRIBUTIONS PAID FROM: (unaudited) (unaudited)
ORDINARY INCOME*
Institutional Class............. $ 129 $ 550 $22,416 $69,221
Investor Class.................. 93 499 17,116 36,886
Advisor Class................... -- -- 61 193
AMR Class....................... 2,146 11,725 17,313 30,031
LONG-TERM CAPITAL GAIN
Institutional Class............. 798 1,527 12,166 127,324
Investor Class.................. 756 1,420 10,088 71,886
Advisor Class................... -- -- 40 395
AMR Class....................... 11,267 30,209 8,489 52,104
------- ------- ------- --------
TOTAL DISTRIBUTIONS PAID.............. $15,189 $45,930 $37,869 $388,040
======= ======= ======= ========
* For tax purposes, short-term capital gains are considered ordinary income
distributions.
As of April 30, 2009, the components of distributable earnings on a tax
basis were as follows (in thousands):
EMERGING INTERNATIONAL
MARKETS EQUITY
--------- -------------
Cost basis of investments for federal income tax purposes ....... $127,719 $1,548,757
Unrealized appreciation ......................................... 4,570 88,931
Unrealized depreciation ......................................... (27,482) (351,372)
-------- ----------
Net unrealized appreciation ..................................... (22,912) (262,441)
Undistributed ordinary income ................................... 297 20,633
Undistributed long-term gain .................................... (19,177) (204,816)
-------- ----------
Distributable earnings .......................................... $(41,792) $ (446,624)
======== ==========
Financial reporting records are adjusted for permanent book/tax differences
to reflect tax character. Financial records are not adjusted for temporary
differences. The temporary differences between financial reporting and tax-basis
reporting of unrealized appreciation/(depreciation) are attributable primarily
to the tax deferral of losses from wash sales, the realization for tax purposes
of unrealized gain/(losses) on certain derivative instruments, the realization
for tax purposes of unrealized gain/(losses) on investments in passive foreign
investment companies, and Section 732 basis adjustments.
Due to inherent differences in the recognition of income, expenses and
realized gains/(losses) under U.S. generally accepted accounting principles and
federal income tax regulations, permanent differences between book and tax
reporting have been identified and appropriately reclassified on the Statements
of Assets and Liabilities.
29
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Accordingly, the following amounts represent current year permanent
differences derived from foreign currency gains/(losses) from sales of
investments in passive foreign investment companies, and Section 732 basis
adjustments that have been reclassified as of April 30, 2009 (in thousands):
EMERGING INTERNATIONAL
MARKETS EQUITY
--------- --------------
Paid-in-capital ................................... $ -- $ 1,731
Undistributed net investment income ............... 175 (13,332)
Accumulated net realized loss ..................... (175) 11,601
Unrealized depreciation of investments,
futures contracts and foreign currency ......... -- --
At April 30, 2009, the capital loss carry forward position for federal
income tax purposes was $19,177 and $204,816 for the Emerging Markets and
International Equity Funds, respectively, both expiring in 2017.
4. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales of investments,
other than short-term obligations, for the six months ended April 30, 2009 were
(in thousands):
EMERGING INTERNATIONAL
MARKETS EQUITY
--------- --------------
Purchases.......................................... $39,185 $226,613
Sales and maturities............................... $26,689 $309,505
A summary of the Funds' direct transactions in the Select Funds for the six
months ended April 30, 2009 is set forth below (in thousands):
OCTOBER 31, 2008 APRIL 30, 2009
AFFILIATED FUND SHARES/MARKET VALUE PURCHASES SALES SHARES/MARKET VALUE
--------------- ------------------- --------- ------- -------------------
Emerging Markets.......... MM Select Fund $ 5,304 -- $ 5,304 $ --
International Equity...... MM Select Fund $26,918 -- $26,918 $ --
International Equity...... USG Select Fund -- 10,000 -- 10,000
5. SECURITIES LENDING
The Funds may lend their securities to qualified financial institutions,
such as certain broker-dealers, to earn additional income. The borrowers are
required to secure their loans continuously with collateral in an amount at
least equal to the fair value of the securities loaned and initially in an
amount at least equal to 102% of the fair value of domestic securities loaned
and 105% of the fair value of international securities loaned. Collateral is
monitored and marked to market daily. Daily mark to market amounts are required
to be paid to the borrower or received from the borrower by the end of the
following business day. This one day settlement for mark to market amounts may
result in the collateral being temporarily less than the value of the securities
on loan or temporarily more than the required minimum collateral. The amount of
this temporary difference at April 30, 2009 is disclosed as the calculated mark
in the table below.
To the extent that a loan is collateralized by cash, such cash collateral
shall be invested by the securities lending agent (the "Agent") in money market
mutual funds, and other short-term investments, provided the investments meet
certain quality and diversification requirements.
Securities lending income is generated from the demand premium (if any)
paid by the borrower to borrow a specific security and from the return on
investment of cash collateral, reduced by negotiated rebate fees paid to the
borrower and transaction costs. To the extent that a loan is secured by non-cash
collateral, securities lending income is generated as a demand premium reduced
by transaction costs. The Fund, the Agent, and the Manager retain 75%, 15%, and
10%, respectively, of the income generated from securities lending.
30
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
While securities are on loan, the Fund continues to receive any income
associated with that security and any gain or loss in the market price that may
occur during the term of the loan.
Securities lending transactions pose certain risks to the Fund, including
that the borrower may not provide additional collateral when required or return
the securities when due, that the value of the short-term investments will be
less than the amount of cash collateral required to be returned to the borrower,
that non-cash collateral may be subject to legal constraints in the event of a
borrower bankruptcy, and that the cash collateral investments could become
illiquid and unable to be used to return collateral to the borrower. The Funds
could also experience delays and costs in gaining access to the collateral. The
Funds bear the risk of any deficiency in the amount of the cash collateral
available for return to the borrower and any action which impairs its ability to
liquidate non-cash collateral to satisfy a borrower default.
At April 30, 2009, the value of outstanding securities on loan and the
value of collateral was as follows (in thousands):
MARKET VALUE OF CASH COLLATERAL TOTAL VALUE OF
FUND SECURITIES ON LOAN NON-CASH COLLATERAL POSTED BY BORROWER CALCULATED MARK COLLATERAL
- ---- ------------------ ------------------- ------------------ --------------- --------------
Emerging Markets 10,512 -- 10,952 67 11,019
International Equity 196,972 -- 207,215 -- 207,215
Cash collateral is listed in the Funds' Schedules of Investments and is
shown on Statements of Assets and Liabilities. Income earned on these
investments is included in Income derived from securities lending in the
Statements of Operations.
Non-cash collateral received by the Funds may not be sold or re-pledged
except to satisfy a borrower default. Therefore, non-cash collateral is not
included on the Funds' Schedules of Investments or Statements of Assets and
Liabilities.
6. CAPITAL SHARE TRANSACTIONS
The tables below summarize the activity in capital shares for each Class of
the Fund (dollars and shares in thousands):
Six Months ended April 30, 2009
INSTITUTIONAL CLASS I NVESTOR CLASS AMR CLASS
------------------- ----------------- -----------------
EMERGING MARKETS FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- --------------------- ------ ------ ------ ------ ------ --------
Shares sold ................................ 2 $ 18 65 $ 494 1,231 $ 10,215
Reinvestment of dividends .................. 126 917 114 822 1,833 13,414
Shares redeemed ............................ (4) (29)* (103) (739)* (1,400) (10,466)*
--- ----- ---- ----- ------ --------
Net increase in shares outstanding ......... 124 $ 906 76 $ 577 1,664 $ 13,163
=== ===== ==== ===== ====== ========
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
------------------- ------------------ --------------- -----------------
INTERNATIONAL EQUITY FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------------------- ------- --------- ------ --------- ------ ------ ------ --------
Shares sold ............................ 4,520 $ 51,803 4,923 $ 56,497 14 $152 3,118 $ 36,860
Reinvestment of dividends .............. 2,451 29,191 2,263 26,656 7 82 2,157 25,802
Shares redeemed ........................ (16,121) (189,662)* (9,214) (106,482)* (4) (46)* (2,246) (25,279)*
------- --------- ------ --------- --- ---- ------ --------
Net increase (decrease) in shares
outstanding ......................... (9,150) $(108,668) (2,028) $ (23,329) 17 $188 3,029 $ 37,383
======= ========= ====== ========= === ==== ====== ========
Year Ended October 31, 2008
INSTITUTIONAL CLASS INVESTOR CLASS AMR CLASS
------------------- ------------------- --------------------
EMERGING MARKETS FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- --------------------- ------ ------- ------ -------- ------ ---------
Shares sold ............................ 7 $ 117 540 $ 9,707 1,030 $ 18,331
Reinvestment of dividends .............. 109 2,039 101 1,876 2,222 41,934
Shares redeemed ........................ (76) (1,074)* (544) (9,254)* (6,393) (102,395)*
--- ------- ---- ------- ------ ---------
Net increase (decrease) in shares
outstanding ......................... 40 $ 1,082 97 $ 2,329 (3,141) $ (42,130)
=== ======= ==== ======= ====== ========
31
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
INSTITUTIONAL CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
-------------------- ------------------- ---------------- -------------------
INTERNATIONAL EQUITY FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------------------- ------- ---------- ------- --------- ------ ------- ------- ---------
Shares sold ............................ 6,925 $ 137,615 12,711 $ 257,961 40 $ 790 2,312 $ 47,462
Reinvestment of dividends .............. 7,822 177,012 4,768 106,664 26 585 3,605 82,134
Shares redeemed ........................ (33,276) (680,261)* (18,249) (352,680)* (130) (2,617)* (5,574) (111,655)*
------- --------- ------- --------- ---- ------- ------ ---------
Net increase (decrease) in shares
outstanding ......................... (18,529) $(365,634) (770) $ 11,945 (64) $(1,242) 343 $ 17,941
======= ========= ======= ========= ==== ======= ====== =========
- ----------
* Net of Redemption Fees
32
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33
AMERICAN BEACON EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
Institutional Class
-------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------
2009 2008 2007 2006 2005 2004
----------- ------- ------- ------- ------ ------
(unaudited)
Net asset value, beginning of period ............. $ 9.00 $ 24.20 $ 17.42 $ 15.10 $12.64 $10.62
-------- ------- ------- ------- ------ ------
Income from investment operations:
Net investment income (loss) .................. (0.01) 0.23 0.26 0.11 0.15 0.07
Net gains (losses) on securities (both realized
and unrealized) ............................ 1.08 (11.78) 9.11 4.63 3.45 2.01
-------- ------- ------- ------- ------ ------
Total income (loss) from investment operations ... 1.07 (11.55) 9.37 4.74 3.60 2.08
-------- ------- ------- ------- ------ ------
Less distributions:
Dividends from net investment income .......... (0.21) (0.10) (0.10) (0.21) (0.06) (0.06)
Distributions from net realized gains on
securities ................................. (1.31) (3.55) (2.49) (2.21) (1.08) --
-------- ------- ------- ------- ------ ------
Total distributions .............................. (1.52) (3.65) (2.59) (2.42) (1.14) (0.06)
-------- ------- ------- ------- ------ ------
Redemption fees added to beneficial interests .... --(A) --(A) --(A) --(A) --(A) --(A)
Net asset value, end of period ................... $ 8.55 $ 9.00 $ 24.20 $ 17.42 $15.10 $12.64
======== ======= ======= ======= ====== ======
Total return ..................................... 14.88%(B) (55.59)% 60.83% 34.49% 30.11% 19.65%
======== ======= ======= ======= ====== ======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $ 6,262 $ 5,478 $13,773 $16,552 $9,348 $7,282
Ratios to average net assets (annualized):
Expenses, net of waivers ...................... 1.77% 1.38% 1.60% 1.56% 1.52% 1.85%
Expenses, before waivers ...................... 1.77% 1.38% 1.60% 1.56% 1.52% 1.85%
Net investment income, net of waivers ......... 0.29% 1.35% 0.93% 0.80% 1.22% 0.74%
Net investment income, before waivers ......... 0.29% 1.35% 0.93% 0.80% 1.22% 0.74%
Portfolio turnover rate ....................... 36%(B) 82% 81% 67% 63% 76%
(A) Amounts represent less than $0.01 per share.
(B) Not annualized.
34
Investor Class AMR Class
- --------------------------------------------------------------- --------------------------------------------------------------
Six Six
Months Months
Ended Year Ended October 31, Ended Year Ended October 31,
April 30, ------------------------------------------------ April 30, -------------------------------------------------
2009 2008 2007 2006 2005 2004 2009 2008 2007 2006 2005 2004
- ----------- --------- ------- ------ ------ ------ ----------- ------- -------- -------- ------- -------
(unaudited) (unaudited)
$ 8.85 $ 23.91 $ 17.22 $14.98 $12.53 $10.55 $ 9.06 $ 24.37 $ 17.52 $ 15.17 $ 12.68 $ 10.66
- ------ ------- ------- ------ ------ ------ -------- ------- -------- -------- ------- -------
0.01 0.17 0.11 0.09 0.15 0.04 (0.01) 0.33 0.19 0.15 0.24 0.10
1.04 (11.60) 9.11 4.55 3.41 1.99 1.10 (11.91) 9.30 4.65 3.42 2.00
- ------ ------- ------- ------ ------ ------ -------- ------- -------- -------- ------- -------
1.05 (11.43) 9.22 4.64 3.56 2.03 1.09 (11.58) 9.49 4.80 3.66 2.10
- ------ ------- ------- ------ ------ ------ -------- ------- -------- -------- ------- -------
(0.16) (0.08) (0.04) (0.19) (0.03) (0.05) (0.25) (0.18) (0.15) (0.24) (0.09) (0.08)
(1.31) (3.55) (2.49) (2.21) (1.08) -- (1.31) (3.55) (2.49) (2.21) (1.08) --
- ------ ------- ------- ------ ------ ------ -------- ------- -------- -------- ------- -------
(1.47) (3.63) (2.53) (2.40) (1.11) (0.05) (1.56) (3.73) (2.64) (2.45) (1.17) (0.08)
- ------ ------- ------- ------ ------ ------ -------- ------- -------- -------- ------- -------
--(A) --(A) --(A) --(A) --(A) --(A) --(A) --(A) --(A) -- -- --
$ 8.43 $ 8.85 $ 23.91 $17.22 $14.98 $12.53 $ 8.59 $ 9.06 $ 24.37 $ 17.52 $ 15.17 $ 12.68
====== ======= ======= ====== ====== ====== ======== ======= ======== ======== ======= =======
14.77%(B) (55.77)% 60.17% 34.16% 29.95% 19.33% 15.06%(B) (55.48)% 61.19% 34.87% 30.43% 20.00%
====== ======= ======= ====== ====== ====== ======== ======= ======== ======== ======= =======
$5,577 $ 5,183 $11,694 $5,841 $2,592 $1,214 $ 83,036 $72,516 $271,726 $135,146 $94,864 $74,199
2.10% 1.72% 1.96% 2.04% 1.75% 2.14% 1.52% 1.17% 1.37% 1.30% 1.25% 1.59%
2.10% 1.72% 1.96% 1.91% 2.01% 2.20% 1.52% 1.17% 1.37% 1.30% 1.25% 1.59%
0.15% 1.00% 0.65% 0.49% 1.16% 0.37% 0.73% 1.46% 1.25% 1.01% 1.60% 1.01%
0.15% 1.00% 0.65% 0.62% 0.90% 0.31% 0.73% 1.46% 1.25% 1.01% 1.60% 1.01%
36%(B) 82% 81% 67% 63% 76% 36%(B) 82% 81% 67% 63% 76%
35
AMERICAN BEACON INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
Institutional Class
----------------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -------------------------------------------------------------
2009 2008 2007 2006 2005 2004(A)
----------- -------- ---------- ---------- ---------- ----------
(unaudited)
Net asset value, beginning of period ............. $ 13.13 $ 27.32 $ 24.68 $ 20.98 $ 18.47 $ 15.46
-------- -------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment income(B, C) ................... 0.33 0.77 0.65 0.60 0.44 0.30
Net gains (losses) on securities (both realized
and unrealized)(B) ......................... (0.59) (11.60) 4.31 4.86 2.31 3.12
-------- -------- ---------- ---------- ---------- ----------
Total income (loss) from investment operations ... (0.26) (10.83) 4.96 5.46 2.75 3.42
-------- -------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .......... (0.61) (0.70) (0.50) (0.43) (0.24) (0.41)
Distributions from net realized gains on
securities ................................. (0.33) (2.66) (1.82) (1.33) -- --
-------- -------- ---------- ---------- ---------- ----------
Total distributions .............................. (0.94) (3.36) (2.32) (1.76) (0.24) (0.41)
-------- -------- ---------- ---------- ---------- ----------
Redemption fees added to beneficial interest(D) .. 0.00 0.00 0.00 0.00 0.00 0.00
-------- -------- ---------- ---------- ---------- ----------
Net asset value, end of period ................... $ 11.93 $ 13.13 $ 27.32 $ 24.68 $ 20.98 $ 18.47
======== ======== ========== ========== ========== ==========
Total return ..................................... (1.98)%(E) (44.81)% 21.54% 27.49% 15.04% 22.49%
======== ======== ========== ========== ========== ==========
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $406,178 $567,414 $1,686,668 $1,549,521 $1,286,441 $1,029,272
Ratios to average net assets (annualized):
Expenses, net of waivers(B) ................ 0.73% 0.66% 0.67% 0.71% 0.70% 0.76%
Expenses, before waivers(B) ................ 0.73% 0.66% 0.67% 0.71% 0.70% 0.76%
Net investment income, net of waivers(B) ... 3.05% 2.91% 2.46% 2.52% 2.17% 1.69%
Net investment income (loss), before ....... 3.05% 2.91% 2.46% 2.52% 2.17% 1.69%
Portfolio turnover rate(F) ....................... 22%(E) 31% 38% 40% 37% 36%
- ----------
(A) The Boston Company Asset Management, LLC was added as an investment advisor
to the International Equity Fund on September 27, 2004.
(B) The per share amounts and ratios reflect income and expenses assuming
inclusion of the Fund's proportionate share of the income and expenses of
the American Beacon International Equity Portfolio through February 28,
2006.
(C) Class expenses per share were subtracted from net investment income per
share for the Fund before class expenses to determine net investment income
per share through October 31, 2005.
(D) Amounts represent less than $0.01 per share.
(E) Not annualized.
(F) The International Equity Fund invested all of its investable assets in the
American Beacon International Equity Portfolio through February 28, 2006.
Portfolio turnover rate through February 28, 2006 is that of the American
Beacon International Equity Portfolio.
36
AMERICAN BEACON INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
Investor Class
--------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------
2009 2008 2007 2006 2005 2004(A)
----------- -------- -------- -------- -------- --------
(unaudited)
Net asset value, beginning of period ............. $ 12.95 $ 26.99 $ 24.42 $ 20.79 $ 18.31 $ 15.34
-------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income(B,C) .................... 0.21 0.66 0.58 0.50 0.41 0.26
Net gains (losses) on securities (both realized
and unrealized)(B) ......................... (0.48) (11.41) 4.26 4.84 2.29 3.08
-------- -------- -------- -------- -------- --------
Total income (loss) from investment operations ... (0.27) (10.75) 4.84 5.34 2.70 3.34
-------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income .......... (0.56) (0.63) (0.45) (0.38) (0.22) (0.37)
Distributions from net realized gains on
securities ................................. (0.33) (2.66) (1.82) (1.33) -- --
-------- -------- -------- -------- -------- --------
Total distributions .............................. (0.89) (3.29) (2.27) (1.71) (0.22) (0.37)
-------- -------- -------- -------- -------- --------
Redemption fees added to beneficial interest(D) .. 0.00 0.00 0.00 0.00 0.00 0.00
-------- -------- -------- -------- -------- --------
Net asset value, end of period ................... $ 11.79 $ 12.95 $ 26.99 $ 24.42 $ 20.79 $ 18.31
======== ======== ======== ======== ======== ========
Total return ..................................... (2.15)%(E) (44.96)% 21.22% 27.20% 14.73% 22.16%
======== ======== ======== ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $364,100 $426,473 $909,385 $771,298 $560,770 $310,540
Ratios to average net assets (annualized):
Expenses, net of waivers(B) ................ 0.99% 0.92% 0.93% 0.96% 0.95% 1.02%
Expenses, before waivers(B) ................ 0.99% 0.92% 0.93% 0.96% 0.95% 1.02%
Net investment income, net of waivers(B) ... 2.87% 2.82% 2.26% 2.25% 1.96% 1.46%
Net investment income (loss), before
waivers(B) .............................. 2.87% 2.82% 2.26% 2.25% 1.96% 1.46%
Portfolio turnover rate(F) .................... 22%(E) 31% 38% 40% 37% 36%
- ----------
(A) The Boston Company Asset Management, LLC was added as an investment advisor
to the International Equity Fund on September 27, 2004.
(B) The per share amounts and ratios reflect income and expenses assuming
inclusion of the Fund's proportionate share of the income and expenses of
the American Beacon International Equity Portfolio through February 28,
2006.
(C) Class expenses per share were subtracted from net investment income per
share for the Fund before class expenses to determine net investment income
per share through October 31, 2005.
(D) Amounts represent less than $0.01 per share.
(E) Not annualized.
(F) The International Equity Fund invested all of its investable assets in the
American Beacon International Equity Portfolio through February 28, 2006.
Portfolio turnover rate through February 28, 2006 is that of the American
Beacon International Equity Portfolio.
37
AMERICAN BEACON INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
Advisor Class
------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ----------------------------------------------
2009 2008 2007 2006 2005 2004(A)
----------- ------- ------ ------ ------- ------
(unaudited)
Net asset value, beginning of period ............. $12.86 $ 26.83 $24.24 $20.61 $ 18.24 $15.31
------ ------- ------ ------ ------- ------
Income from investment operations:
Net investment income(B,C) .................... 0.13 0.62 0.56 0.46 0.37 0.30
Net gains (losses) on securities (both realized
and unrealized)(B) ......................... (0.43) (11.35) 4.20 4.76 2.26 2.99
------ ------- ------ ------ ------- ------
Total income (loss) from investment operations ... (0.30) (10.73) 4.76 5.22 2.63 3.29
------ ------- ------ ------ ------- ------
Less distributions:
Dividends from net investment income .......... (0.50) (0.58) (0.35) (0.26) (0.26) (0.36)
Distributions from net realized gains on
securities ................................. (0.33) (2.66) (1.82) (1.33) -- --
------ ------- ------ ------ ------- ------
Total distributions .............................. (0.83) (3.24) (2.17) (1.59) (0.26) (0.36)
------ ------- ------ ------ ------- ------
Redemption fees added to beneficial interest(D) .. 0.00 0.00 0.00 0.00 0.00 0.00
------ ------- ------ ------ ------- ------
Net asset value, end of period ................... $11.73 $ 12.86 $26.83 $24.24 $ 20.61 $18.24
====== ======= ====== ====== ======= ======
Total return ..................................... (2.32)%(E) (45.10)% 20.85% 26.89% 14.45% 21.88%
====== ======= ====== ====== ======= ======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $1,604 $ 1,546 $4,932 $4,740 $ 2,987 $ 739
Ratios to average net assets (annualized):
Expenses, net of waivers(B) ................ 1.34% 1.19% 1.12% 1.16% 1.21% 1.27%
Expenses, before waivers(B) ................ 1.34% 1.19% 1.15% 1.19% 1.21% 6.26%
Net investment income, net of waivers(B) ... 2.62% 2.36% 2.04% 2.09% 1.70% 0.81%
Net investment income (loss), before
waivers(B) .............................. 2.62% 2.36% 2.01% 2.05% 1.70% (4.18)%
Portfolio turnover rate(F) .................... 22%(E) 31% 38% 40% 37% 36%
- ----------
(A) The Boston Company Asset Management, LLC was added as an investment advisor
to the International Equity Fund on September 27, 2004.
(B) The per share amounts and ratios reflect income and expenses assuming
inclusion of the Fund's proportionate share of the income and expenses of
the American Beacon International Equity Portfolio through February 28,
2006.
(C) Class expenses per share were subtracted from net investment income per
share for the Fund before class expenses to determine net investment income
per share through October 31, 2005.
(D) Amounts represent less than $0.01 per share.
(E) Not annualized.
(F) The International Equity Fund invested all of its investable assets in the
American Beacon International Equity Portfolio through February 28, 2006.
Portfolio turnover rate through February 28, 2006 is that of the American
Beacon International Equity Portfolio.
38
AMERICAN BEACON INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
AMR Class
--------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------
2009 2008 2007 2006 2005 2004(A)
----------- -------- -------- -------- -------- --------
(unaudited)
Net asset value, beginning of period ............. $ 13.25 $ 27.54 $ 24.86 $ 21.12 $ 18.58 $ 15.54
-------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income(B, C) ................... 0.17 0.72 0.73 0.63 0.50 0.34
Net gains (losses) on securities (both realized
and unrealized)(B) ......................... (0.43) (11.58) 4.33 4.92 2.33 3.14
-------- -------- -------- -------- -------- --------
Total income (loss) from investment operations ... (0.26) (10.86) 5.06 5.55 2.83 3.48
-------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income .......... (0.67) (0.77) (0.56) (0.48) (0.29) (0.44)
Distributions from net realized gains on
securities ................................. (0.33) (2.66) (1.82) (1.33) -- --
-------- -------- -------- -------- -------- --------
Total distributions .............................. (1.00) (3.43) (2.38) (1.81) (0.29) (0.44)
-------- -------- -------- -------- -------- --------
Redemption fees added to beneficial interest(D) .. 0.00 0.00 0.00 0.00 0.00 0.00
-------- -------- -------- -------- -------- --------
Net asset value, end of period ................... $ 11.99 $ 13.25 $ 27.54 $ 24.86 $ 21.12 $ 18.58
======== ======== ======== ======== ======== ========
Total return ..................................... (1.91)%(E) (44.65)% 21.86% 27.88% 15.32% 22.84%
======== ======== ======== ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $333,221 $328,083 $672,680 $563,231 $448,096 $460,114
Ratios to average net assets (annualized):
Expenses, net of waivers(B) ................ 0.48% 0.41% 0.42% 0.45% 0.44% 0.49%
Expenses, before waivers(B) ................ 0.48% 0.41% 0.42% 0.45% 0.44% 0.49%
Net investment income, net of waivers(B) ... 3.43% 3.24% 2.77% 2.76% 2.49% 1.97%
Net investment income (loss), before
waivers(B) .............................. 3.43% 3.24% 2.77% 2.76% 2.49% 1.97%
Portfolio turnover rate(F) .................... 22%(E) 31% 38% 40% 37% 36%
- ----------
(A) The Boston Company Asset Management, LLC was added as an investment advisor
to the International Equity Fund on September 27, 2004.
(B) The per share amounts and ratios reflect income and expenses assuming
inclusion of the Fund's proportionate share of the income and expenses of
the American Beacon International Equity Portfolio through February 28,
2006.
(C) Class expenses per share were subtracted from net investment income per
share for the Fund before class expenses to determine net investment income
per share through October 31, 2005.
(D) Amounts represent less than $0.01 per share.
(E) Not annualized.
(F) The International Equity Fund invested all of its investable assets in the
American Beacon International Equity Portfolio through February 28, 2006.
Portfolio turnover rate through February 28, 2006 is that of the American
Beacon International Equity Portfolio.
39
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(AMERICAN BEACON FUNDS(SM) LOGO)
DELIVERY OF DOCUMENTS
To reduce expenses, your financial institution may mail only one copy of the
Prospectus, Annual Report and Semi-Annual Report to those addresses shared by
two or more accounts. If you wish to receive individual copies of these
documents, please contact your financial institution. Delivery of individual
copies will commence thirty days after receiving your request.
If you invest in the Fund through a financial institution, you may be able to
receive the Fund's regulatory mailings, such as the Prospectus, Annual Report
and Semi-Annual Report, by e-mail. If you are interested in this option, please
go to www.icsdelivery.com and search for your financial institution's name or
contact your financial institution directly.
TO OBTAIN MORE INFORMATION ABOUT THE FUND:
(GRAPHIC)
BY E-MAIL:
american_beacon.funds@ambeacon.com
(GRAPHIC)
BY TELEPHONE:
Institutional Class
Call (800) 658-5811
AMR Class(SM)
Call (800) 345-2345
Investor Class(R) and Advisor Class
Call (800) 388-3344
(GRAPHIC)
ON THE INTERNET:
Visit our website at www.americanbeaconfunds.com
(GRAPHIC)
BY MAIL:
American Beacon Funds
P.O. Box 219643
Kansas City, MO 64121-9643
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
In addition to the Schedule of Investments provided in each semi-annual and
annual report, the Fund files a complete schedule of its portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q as of the first and
third fiscal quarters. The Fund's Forms N-Q are available on the SEC's website
at www.sec.gov. The Forms N-Q may also be reviewed and copied at the SEC's
Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549. Information
regarding the operation of the SEC's Public Reference Room may be obtained by
calling 1-800-SEC-0330. A complete schedule of the Fund's portfolio holdings is
also available on the Funds' website (www.americanbeaconfunds.com) approximately
thirty days after the end of each month.
AVAILABILITY OF PROXY VOTING POLICY AND RECORDS
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available in the Fund's
Statement of Additional Information, is available free of charge on the Fund's
website (www.americanbeaconfunds.com) and by calling 1-800-967-9009 or by
accessing the SEC's website at www.sec.gov. The Fund's proxy voting record for
the most recent year ended June 30 is filed annually with the SEC on Form N-PX.
The Fund's Forms N-PX are available on the SEC's website at www.sec.gov. The
Fund's proxy voting record may also be obtained by calling 1-800-967-9009.
FUND SERVICE PROVIDERS:
CUSTODIAN TRANSFER AGENT INDEPENDENT REGISTERED DISTRIBUTOR
STATE STREET BANK AND BOSTON FINANCIAL DATA PUBLIC ACCOUNTING FIRM FORESIDE FUND SERVICES
TRUST SERVICES ERNST & YOUNG LLP Portland, Maine
Boston, Massachusetts Kansas City, Missouri Dallas, Texas
This report is prepared for shareholders of the American Beacon Funds and may be
distributed to others only if preceded or accompanied by a current prospectus.
American Beacon Funds, American Beacon Emerging Markets Fund and American Beacon
International Equity Fund are a service marks of American Beacon Advisors, Inc.
SAR 04//09
00068038
GUIDANCE | VISION | EXPERIENCE
(AMERICAN BEACON FUNDS(SM) LOGO)
Semi-Annual Report
APRIL 30, 2009
BALANCED FUND
LARGE CAP GROWTH FUND
MID-CAP VALUE FUND
SMALL CAP VALUE OPPORTUNITY FUND
(GRAPHIC)
About American Beacon Advisors
Since 1986, American Beacon Advisors has offered a variety of products and
investment advisory services to numerous institutional and retail clients,
including a variety of mutual funds, corporate cash management, and separate
account management.
Our clients include defined benefit plans, defined contribution plans,
foundations, endowments, corporations, financial planners, and other
institutional investors. With American Beacon Advisors, you can put the
experience of a multi-billion dollar asset management firm to work for your
company.
Contents
Message from American Beacon....................................... 1
Market and Performance Overviews................................... 2-10
American Beacon Schedules of Investments
Balanced Fund................................................... 11
Large Cap Growth Fund........................................... 20
Mid-Cap Value Fund.............................................. 23
Small Cap Value Opportunity Fund................................ 26
Additional Information............................................. Back Cover
Any opinions herein, including forecasts, reflect our judgment as of the end of
the reporting period and are subject to change. Each advisor's strategies and
each Fund's portfolio composition will change depending on economic and market
conditions. This report is not a complete analysis of market conditions and
therefore, should not be relied upon as investment advice. Although economic and
market information has been compiled from reliable sources, American Beacon
Advisors, Inc. makes no representation as to the completeness or accuracy of the
statements contained herein.
(PHOTO OF GENE L. NEEDLES, JR.)
FELLOW SHAREHOLDERS,
Please allow me to introduce myself. I am Gene Needles, Jr., the new
Executive Vice President for the American Beacon Funds. I have over 27 years of
financial services experience with some of the country's largest fund complexes,
and I will be primarily responsible for daily operations as well as distribution
of the American Beacon Funds. I am very excited to be a part of American Beacon
and look forward to building a lasting relationship with all of our
shareholders.
Enclosed is the American Beacon Funds Semi-Annual Report for the six months
ended April 30, 2009 for our Balanced, Large Cap Growth, Mid-Cap Value and Small
Cap Value Opportunity Funds.
During the six-month period covered by this report, the capital markets
experienced widespread volatility brought on by concern over the world-wide
credit crisis. The American Beacon Mid-Cap Value Fund - Institutional Class
reported a six-month return of 3.40% for the period ended April 30, 2009 while
the S&P 500 and Dow Jones Industrial Average Indices reported returns of -8.53%
and -10.79%, respectively, for this period.
In the past, long-term investors have been rewarded for their patience. We
continue to believe the Funds' fundamental investment strategies will continue
to serve the Funds well over time.
Please review the enclosed market overview, portfolio listings, and
detailed financial data. As always, we welcome the opportunity to serve your
financial needs. To obtain further details about the American Beacon Funds
family or to access your account information, please visit our website at
www.americanbeaconfunds.com. Thank you for your continued confidence in the
American Beacon Funds.
Sincerely,
/s/ Gene L. Needles, Jr.
Gene L. Needles, Jr.
Executive Vice President
American Beacon Funds
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
Investing in the securities of small and mid-capitalization companies involves
greater risk and the possibility of greater price volatility than investing in
larger capitalization and more established companies.
American Beacon Funds April 30, 2009
1
DOMESTIC EQUITY MARKET OVERVIEW
APRIL 30, 2009 (UNAUDITED)
A tale of two markets might be the most accurate description of the
six-month period ended April 30, 2009. The equity markets were down for the 6
months, as represented by a decline of 8.5% for the S&P 500, but for the first
four months, the S&P 500 fell a breath-taking 23.2%. Through February, bleak
economic performance around the world set the background for equity market
declines. In addition to the well publicized economic distress in the U.S., the
period featured news of staggering declines in Japanese manufacturing and sharp
declines in Asian and Eastern European exports. The U.K. and Western Europe
continued to be weak, with the Bank of England purchasing U.K. government debt
in an aggressive move to quantitative easing as its benchmark interest rate came
close to zero. Latin America slowed down, with Mexico in a deep recession. China
was the global exception with domestic demand appearing to hold up and loan
creation remaining solid.
Starting in March, equities staged a dramatic recovery in the face of
continued poor economic data, providing support for the view that valuations
ultimately drive stock prices. The U.S. government's announcement of details on
initiatives to stabilize the banking and housing market appeared to spark the
rally. Although some economic data points began to show a hint of economic
stability (or at least a deceleration in the rate of decline) toward the end of
April, it is still too early to call an improvement in the economy. However it
is apparent that because the market was trading at such deeply depressed,
pessimistic levels, the mere hint of a recovery was enough to cause a
significant rally. Thus for March and April, the S&P 500 was up 19.2%, unwinding
a large part of the earlier months' declines.
2
PERFORMANCE OVERVIEW
AMERICAN BEACON BALANCED FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Balanced Fund's Institutional Class returned -1.21% for the six months
ended April 30, 2009, outperforming the 60% Russell 1000(R) Value Index/40%
Barclays Capital Aggregate Index benchmark return of -4.74% and the Lipper Mixed
Asset Target Allocation Growth Funds Index return of -1.90% for the same period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
--------- ------ ------- --------
Institutional Class(1,5) ............... -1.21% -24.56% 0.42% 2.44%
Investor Class(1,5) .................... -1.32% -24.72% 0.15% 2.17%
Advisor Class(1,2,5) ................... -1.43% -24.86% -0.09% 2.05%
AMR Class(1,5) ......................... -1.04% -24.35% 0.68% 2.71%
Balanced Composite Index (3) ........... -4.74% -23.78% 0.68% 2.28%
Russell 1000 Value Index(4) ............ -13.27% -39.21% -2.50% -0.50%
Barclays Capital Aggregate Index(4) .... 7.75% 3.84% 4.78% 5.71%
Lipper Mixed-Asset Target Allocations
Growth Funds Index(4) ................ -1.90% -26.77% -0.11% 1.29%
* Not annualized
(1.) The Investor and Advisor Classes were formerly known as the PlanAhead and
Service Classes, respectively. Performance shown is historical and may not
be indicative of future returns. Investment returns and principal value
will vary, and shares may be worth more or less at redemption than at
original purchase. Performance shown is as of date indicated, and current
performance may be lower or higher than the performance data quoted. To
obtain performance as of the most recent month end, please visit
www.americanbeaconfunds.com or call 1-800-967-9009. Fund performance in the
table above does not reflect the deduction of taxes a shareholder would pay
on distributions or the redemption of shares.
(2.) Fund performance for the five-year and ten-year periods represents the
total returns achieved by the Investor Class from 4/30/99 up to 5/31/05,
the inception date of the Advisor Class, and the returns of the Advisor
Class since its inception. Expenses of the Advisor Class are higher than
those of the Investor Class. Therefore, total returns shown may be higher
than they would have been had the Advisor Class been in existence since
4/30/99. A portion of the fees charged to the Advisor Class of the Fund was
waived in 2005. Performance prior to waiving fees was lower than actual
returns shown for 2005.
(3.) To reflect the Fund's allocation of its assets between investment grade
fixed-income securities and equity securities, the returns of the Russell
1000 Value Index and the Barclays Capital Aggregate Index have been
combined in a 60%/40% proportion.
(4.) The Russell 1000 Value Index is an unmanaged index of those stocks in the
Russell 1000 Index with lower price-to-book ratios and lower forecasted
growth values. Russell 1000 Value Index and Russell 1000 Index are
registered trademarks of Frank Russell Company. The Barclays Capital
Aggregate Index is a market value weighted index of government, corporate,
mortgage-backed and asset-backed fixed-rate debt securities of all
maturities. The Lipper Mixed-Asset Target Allocation Growth Funds Index
tracks the results of the 30 largest mutual funds in the Lipper Mixed-Asset
Target Allocation Growth Funds category. Lipper is an independent mutual
fund research and ranking service. One cannot directly invest in an index.
(5.) The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, Advisor and AMR Class
shares was 0.57%, 0.91%, 1.08% and 0.32%, respectively. The expense ratios
above may vary from the expense ratios presented in other sections of this
report that are based on expenses incurred during the period covered by
this report.
During the six-month period, the Fund's assets on average were invested 55%
in equities (including equitized cash) and 45% in fixed-income securities,
ending the period with approximately 58% invested in equities and 42% in
fixed-income securities.
The equity portion of the Fund (excluding equitized cash) returned -10.6%
for the period, exceeding the Russell 1000 Value Index ("Russell Value Index")
return of -13.3%. The Fund's good performance versus the Russell Value Index was
primarily due to sector allocation, as stock selection added only modest value
to performance. During the six-month period, a four times overweighting in
Information Technology, the best performing sector in the Russell Value Index,
and an underweight in Financials, the worst performing sector in the Russell
Value Index, added value to the Fund's relative returns through sector
allocation. Excess performance from the Fund's allocation to the aforementioned
sectors was somewhat offset by underperformance generated by an underweight in
the Consumer Discretionary sector and an overweight in the Industrials sector.
The Fund's holdings in the Industrials and Health Care sectors added the
most value relative to the Russell Value Index. In the Industrials sector,
Honeywell International (up 4.6%), Illinois Tool Works (up 0.1%), and Paccar (up
23.2%) contributed most to performance. Wyeth (up 33.9%), Schering Plough (up
60.6%), and Cigna (up 21.3%) were the largest contributors in the Health Care
sector. Good stock selection in the aforementioned sectors was mostly offset by
holdings in the Information Technology and Financials sectors. Microsoft (down
8.0%), Hewlett Packard (down 5.5%), and CA (down 2.7%) were the largest
detractors in the Information Technology sector. In the Financials sector, Bank
of America (down 62.2%), Citigroup (down 77.6%), and Capital One Financial (down
55.6%) hurt performance most.
3
PERFORMANCE OVERVIEW
AMERICAN BEACON BALANCED FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The fixed-income portion of the Fund returned 11.2% for the six-month
period, outperforming the Barclays Capital Aggregate Index return of 7.7%. The
Fund's fixed-income excess performance was due mostly to good security selection
in the Agency and Corporate sectors.
The sub-advisors continue to focus on the disciplined selection of
attractive securities that should allow the Fund to benefit long-term.
TOP TEN EQUITY HOLDINGS
% OF
EQUITIES
--------
JPMorgan Chase & Co..................... 1.7%
AT&T, Inc............................... 1.6%
Philip Morris International, Inc........ 1.4%
Wyeth Corp.............................. 1.4%
ConocoPhillips.......................... 1.3%
Microsoft Corp.......................... 1.3%
International Business Machines Corp.... 1.3%
Bristol-Myers Squibb Co................. 1.1%
Verizon Communications, Inc............. 1.1%
Honeywell International, Inc............ 1.1%
EQUITY SECTOR ALLOCATION
% OF
EQUITIES
--------
Financials.............................. 17.4%
Industrials............................. 15.7%
Health Care............................. 13.0%
Information Technology.................. 12.7%
Consumer Staples........................ 9.5%
Consumer Discretionary.................. 8.5%
Energy.................................. 8.5%
Utilities............................... 5.6%
Telecommunication Services.............. 5.2%
Materials............................... 3.9%
FIXED-INCOME SECTOR ALLOCATION
% OF
FIXED INCOME
------------
Corporate............................... 42.8%
Mortgage-Backed......................... 28.8%
Agency.................................. 18.2%
U.S. Treasury........................... 8.8%
Asset-Backed............................ 1.4%
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
4
PERFORMANCE OVERVIEW
AMERICAN BEACON LARGE CAP GROWTH FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Large Cap Growth Fund returned -3.03% for
the six months ended April 30, 2009, compared to the Russell 1000(R) Growth
Index ("Index") return of -1.52% and the Lipper Large-Cap Growth Funds Index
return of -1.65%.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
-------------------------------------------
SINCE INCEP.
6 MONTHS* 1 YEAR 5 YEARS (7/31/00)
--------- ------ ------- ------------
Institutional Class(1,3) ............... -3.03% -34.28% -4.61% -8.46%
AMR Class(1,3) ......................... -3.06% -34.11% -4.33% -8.27%
Russell 1000 Growth Index(2) .......... -1.52% -31.57% -2.39% -7.40%
Lipper Large-Cap Growth Funds Index(2).. -1.65% -33.80% -2.58% -7.76%
* Not annualized
(1.) Performance shown is historical and may not be indicative of future
returns. Investment returns and principal value will vary, and shares may
be worth more or less at redemption than at original purchase. Performance
shown is as of date indicated, and current performance may be lower or
higher than the performance data quoted. To obtain performance as of the
most recent month end, please visit www.americanbeaconfunds.com or call
1-800-967-9009. Fund performance in the table above does not reflect the
deduction of taxes a shareholder would pay on distributions or the
redemption of shares. A portion of the fees charged to the Institutional
Class of the Fund has been waived since 2004. Performance prior to waiving
the fees was lower than the actual returns shown for periods since 2004.
(2.) The Russell 1000 Growth Index is an unmanaged index of those stocks in the
Russell 1000 Index with higher price-to-book ratios and higher forecasted
growth values. Russell 1000 Growth Index and Russell 1000 Index are
registered trademarks of Frank Russell Company. The Lipper Large-Cap Growth
Funds Index tracks the results of the 30 largest mutual funds in the Lipper
Large-Cap Growth Funds category. Lipper is an independent mutual fund
research and ranking service. One cannot directly invest in an index.
(3.) The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional and AMR Class shares was 1.01% and
0.65%, respectively. The expense ratios above may vary from the expense
ratios presented in other sections of this report that are based on
expenses incurred during the period covered by this report.
The Fund underperformed the Index primarily through stock selection, and to
a lesser extent, through sector allocation. From a stock selection standpoint,
the Fund was hurt most by poor stock selection in the Industrials, Financials,
Health Care, and Information Technology sectors. Companies with the greatest
negative impact in the Industrials sector included Norfolk Southern (down 39.0%)
and Boeing (down 38.8% for the period the Fund owned the security). In the
Financials sector, AFLAC and Simon Property Group were the largest detractors
(down 57.6% and 46.3%, respectively, for the period the Fund owned the
securities). Positions in Varian Medical System (down 26.7%), Baxter (down
19.0%), and Abbott Labs (down 22.9%) hurt the Fund's Health Care sector returns,
while Accenture (down 11.0%) and Microsoft (down 8.0%) detracted the most value
relative to the Index in the Information Technology sector.
The Fund's overweighting in the Health Care sector produced negative
relative returns from a sector allocation perspective. Underweighting the
Information Technology sector, the best-performing sector in the Index, also
contributed to the Fund's underperformance.
Looking forward, the Fund's sub-advisors will continue to maintain a
disciplined, long-term approach to equity investing in larger stocks with
above-average growth potential.
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
Union Pacific Corp...................... 2.4%
Monsanto................................ 2.3%
Apple Computer, Inc..................... 2.3%
Medco Health Solutions, Inc............. 2.1%
Gilead Sciences, Inc.................... 2.1%
Microsoft Corp.......................... 2.0%
Hewlett-Packard Co...................... 1.9%
QUALCOMM, Inc........................... 1.9%
United Technologies Corp................ 1.9%
Oracle Corp............................. 1.8%
SECTOR ALLOCATION
% OF
EQUITIES
--------
Information Technology.................. 25.9%
Industrials............................. 20.0%
Health Care............................. 18.5%
Consumer Discretionary.................. 11.6%
Financials.............................. 6.8%
Consumer Staples........................ 5.9%
Energy.................................. 5.5%
Telecommunication Services.............. 1.5%
Utilities............................... 0.5%
5
PERFORMANCE OVERVIEW
AMERICAN BEACON MID-CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Mid-Cap Value Fund returned 3.40% for the
six months ended April 30, 2009. The Fund outperformed the Russell Midcap(R)
Value Index ("Index") return of -6.14% and the Lipper Mid-Cap Value Funds Index
return of -1.17%.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
-------------------------------------------
SINCE INCEP.
6 MONTHS* 1 YEAR 3 YEARS (6/30/04)
--------- ------ ------- ------------
Institutional Class(1,3,6) ............. 3.40% -31.56% -11.84% -2.23%
Investor Class (1,2,6) ................. 3.22% -31.76% -12.09% -2.41%
Advisor Class (1,4,6) .................. 3.61% -31.55% -12.06% -2.38%
AMR Class (1,6) ........................ 3.38% -31.50% -11.70% -2.11%
Russell Midcap(R) Value Index(5) ....... -6.14% -36.76% -12.56% -1.18%
Lipper Mid-Cap Value Funds Index(5) .... -1.17% -34.47% -11.24% -1.93%
* Not annualized
(1.) The Investor and Advisor Classes were formerly known as the PlanAhead and
Service Classes, respectively. Performance shown is historical and may not
be indicative of future returns. Investment returns and principal value
will vary, and shares may be worth more or less at redemption than at
original purchase. Performance shown is as of date indicated, and current
performance may be lower or higher than the performance data quoted. To
obtain performance as of the most recent month end, please visit
www.americanbeaconfunds.com or call 1-800-967-9009. Fund performance in the
table above does not reflect the deduction of taxes a shareholder would pay
on distributions or the redemption of shares. A portion of the fees charged
to the AMR Class of the Fund was waived through 2006. Performance prior to
waiving fees was lower than the actual returns shown.
(2.) Fund performance for the since inception period represents the total
returns achieved by the AMR Class from 6/30/04 up to 3/1/06, the inception
date of the Investor Class, and the returns of the Investor Class since its
inception. Expenses of the Investor Class are higher than those of the AMR
Class. As a result, total returns shown may be higher than they would have
been had the Investor Class been in existence since 6/30/04. A portion of
the fees charged to the Investor Class of the Fund has been waived since
2006. Performance prior to waiving fees was lower than actual returns shown
since 2006.
(3.) Fund performance for the since inception period represents the total
returns achieved by the AMR Class from 6/30/04 up to 11/30/05, the
inception date of the Institutional Class, and the returns of the
Institutional Class since its inception. Expenses of the Institutional
Class are higher than those of the AMR Class. As a result, total returns
shown may be higher than they would have been had the Institutional Class
been in existence since 6/30/04. A portion of the fees charged to the
Institutional Class of the Fund has been waived since 2007. Performance
prior to waiving fees was lower than actual returns shown since 2007.
(4.) Performance shown prior to the 6/29/07 inception of the Advisor Class is
that of the AMR Class from 6/30/04 to 11/30/05, the Institutional Class
from 11/30/05 to 2/28/06 and the Investor Class from 2/28/06 to 6/29/07.
The returns have not been adjusted for any difference between the fees and
expenses of the Advisor Class and the historical fees and expenses of the
AMR, Institutional and Investor Classes. Because the AMR, Institutional and
Investor Classes had lower expenses, their performance was better than the
Advisor Class would have realized during the same period. A portion of the
fees charged to the Advisor Class of the Fund has been waived since 2007.
Performance prior to waiving fees was lower than the actual returns shown
since 2007.
(5.) The Russell Midcap Value Index is an unmanaged index of those stocks in the
Russell Midcap Index with lower price-to-book ratios and lower forecasted
growth values. The Russell Midcap Index measures the performance of the 800
smallest companies in the Russell 1000 Index. Russell Midcap Value Index,
Russell Midcap Index and Russell 1000 Index are registered trademarks of
Frank Russell Company. The Lipper Mid-Cap Value Funds Index tracks the
results of the 30 largest mutual funds in the Lipper Mid-Cap Value Funds
category. Lipper is an independent mutual fund research and ranking
service. One cannot directly invest in an index.
(6.) The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, Advisor, and AMR Class
shares was 1.17%, 1.33%, 2.05%, and 0.83%, respectively. The expense ratios
above may vary from the expense ratios presented in other sections of this
report that are based on expenses incurred during the period covered by
this report.
The Fund outperformed the Index as both sector allocation and stock
selection added value relative to the Index. Significant overweightings in
Consumer Discretionary, Information Technology, and Health Care, three of the
top performing sectors in the Index, were a major source of excess performance.
An underweight in Financials, the worst performing sector in the Index, also
added to the Fund's performance.
From a stock selection standpoint, investments in the Financials and
Utilities sectors contributed most to the Fund's excess performance. In the
Financials sector, Moody's (up 16.4%) and Annaly Capital Management (up 8.1%)
added the most value relative to the Index. Xcel Energy (up 8.7%) and Sempra
Energy (up 10.0%) were the largest contributors in the Utilities sector. The
Fund's holdings in the Health Care sector detracted value. Health Care companies
with the greatest negative impact included Hill-Rom Holdings (down 37.8% for the
period the Fund owned the security), IMS Health (down 12.0%), and Omnicare (down
6.6%).
The sub-advisors' philosophy of investing in undervalued companies that
exhibit improving profitability and earnings growth potential should allow the
Fund to benefit longer term.
6
PERFORMANCE OVERVIEW
AMERICAN BEACON MID-CAP VALUE FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
L-3 Communications Holdings, Inc........ 3.0%
J.C. Penney Company, Inc................ 1.9%
Avnet, Inc.............................. 1.8%
Motorola, Inc........................... 1.8%
Tyco Electronics Ltd.................... 1.8%
GameStop Corp........................... 1.7%
Omnicare, Inc........................... 1.7%
Alcatel-Lucent.......................... 1.7%
Stanley Works........................... 1.7%
Annaly Capital Management, Inc.......... 1.7%
SECTOR ALLOCATION
% OF
EQUITIES
--------
Consumer Discretionary ................. 24.2%
Financials.............................. 19.7%
Information Technology ................. 14.9%
Health Care ............................ 12.4%
Industrials ............................ 12.4%
Utilities .............................. 7.5%
Consumer Staples ....................... 4.8%
Energy ................................. 4.1%
Investing in the securities of mid-capitalization companies involves greater
risk and the possibility of greater price volatility than investing in larger
capitalization and more established companies.
7
PERFORMANCE OVERVIEW
AMERICAN BEACON SMALL CAP VALUE OPPORTUNITY FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Small Cap Value Opportunity Fund closed on May 29, 2009.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------
SINCE INCEP.
6 MONTHS* 1 YEAR (3/31/06)
--------- ------ ------------
Institutional Class(1,3)................ -15.99% -36.01% -16.63%
Investor Class(1,3)..................... -16.07% -36.07% -16.74%
Russell 2000 Value Index (2)............ -12.61% -31.37% -13.06%
Lipper Small-Cap Value Funds Index (2).. -5.16% -29.97% -11.83%
* Not annualized
(1.) The Investor Class was formerly known as the PlanAhead Class. Performance
shown is historical and may not be indicative of future returns. Investment
returns and principal value will vary, and shares may be worth more or less
at redemption than at original purchase. Performance shown is as of date
indicated, and current performance may be lower or higher than the
performance data quoted. To obtain performance as of the most recent month
end, please visit www.americanbeaconfunds.com or call 1-800-967-9009. Fund
performance in the table above does not reflect the deduction of taxes a
shareholder would pay on distributions or the redemption of shares. A
portion of the fees charged to the Institutional and Investor Classes of
the Fund has been waived. Performance prior to waiving fees was lower than
the actual returns shown.
(2.) The Russell 2000 Value Index is an unmanaged index of those stocks in the
Russell 2000 Index with lower price-to-book ratios and lower forecasted
growth values. Russell 2000 Value Index and Russell 2000 Index are
registered trademarks of Frank Russell Company. The Lipper Small-Cap Value
Funds Index tracks the results of the 30 largest mutual funds in the Lipper
Small-Cap Value Funds category. Lipper is an independent mutual fund
research and ranking service. One cannot directly invest in an index.
(3.) The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional and Investor Class shares was 1.57%
and 1.83%, respectively. The expense ratios above may vary from the expense
ratios presented in other sections of this report that are based on
expenses incurred during the period covered by this report.
Investing in the securities of small-capitalization companies involves greater
risk and the possibility of greater price volatility than investing in larger
capitalization and more established companies.
8
FUND EXPENSES - ACTUAL
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of a Fund, you incur two types of costs: (1) transaction
costs, including redemption fees if applicable, and (2) ongoing costs, including
management fees, administrative service fees, and other Fund expenses. The
examples below are intended to help you understand the ongoing cost (in dollars)
of investing in a particular Fund and to compare these costs with the ongoing
costs of investing in other mutual funds. The examples are based on an
investment of $1,000 invested at the beginning of the period in each Class and
held for the entire period from November 1, 2008 through April 30, 2009.
ACTUAL EXPENSES
The following tables provide information about actual account values and
actual expenses. You may use the information on this page, together with the
amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the "Expenses Paid During
Period" for the applicable Fund to estimate the expenses you paid on your
account during this period. Shareholders of the Investor and Institutional
Classes that invest in a Fund through an IRA may be subject to a custodial IRA
fee of $12 that is typically deducted each December. If your account was subject
to a custodial IRA fee during the period, your costs would have been $12 higher.
SMALL CAP
LARGE CAP VALUE
BALANCED GROWTH MID-CAP OPPORTUNITY
INSTITUTIONAL CLASS FUND FUND VALUE FUND FUND
- ------------------- --------- --------- ---------- -----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $ 987.94 $ 969.68 $1,034.03 $ 840.11
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 2.81 $ 4.30 $ 4.94 $ 8.67
Annualized Expense Ratio ........................ 0.57% 0.88% 0.98% 1.90%
SMALL CAP
VALUE
BALANCED MID-CAP OPPORTUNITY
INVESTOR CLASS FUND VALUE FUND FUND
- -------------- --------- ---------- -----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $ 986.79 $1,032.23 $ 839.25
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 4.14 $ 6.20 $ 5.97
Annualized Expense Ratio ........................ 0.84% 1.23% 1.31%
BALANCED MID-CAP
ADVISOR CLASS FUND VALUE FUND
- ------------- --------- ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $ 985.68 $1,036.06
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 5.27 $ 2.68
Annualized Expense Ratio ........................ 1.07% 0.53%
BALANCED LARGE CAP MID-CAP
AMR CLASS FUND GROWTH FUND VALUE FUND
- --------- --------- ----------- ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/2009 .................. $ 989.61 $ 969.43 $1,033.78
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 1.58 $ 2.78 $ 4.34
Annualized Expense Ratio ........................ 0.32% 0.57% 0.86%
- ----------
* Expenses are equal to the Fund's annualized expense ratio for the six-month
period multiplied by the average account value over the period, multiplied
by the number derived by dividing the number of days in the most recent
fiscal half-year ( 181 ) by days in the year ( 365 ) to reflect the
half-year period.
9
FUND EXPENSES - HYPOTHETICAL
APRIL 30, 2009 (UNAUDITED)
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The following tables provide information about hypothetical account values
and hypothetical expenses based on a Fund's actual expense ratio and an assumed
5% per year rate of return before expenses (not the Fund's actual return). You
may compare the ongoing costs of investing in a particular Fund with other funds
by contrasting this 5% hypothetical example and the 5% hypothetical examples
that appear in the shareholder reports of the other funds. The hypothetical
account values and expenses may not be used to estimate the actual ending
account balance or expenses you paid for the period. Shareholders of the
Investor and Institutional Classes that invest in a Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by a
Fund, such as redemption fees as applicable. Similarly, the expense examples for
other funds do not reflect any transaction costs charged by those funds, such as
sales charges (loads), redemption fees or exchange fees. Therefore, the
following tables are useful in comparing ongoing costs only and will not help
you determine the relative total costs of owning different funds. If you were
subject to any transaction costs during the period, your costs would have been
higher.
SMALL CAP
LARGE CAP VALUE
BALANCED GROWTH MID-CAP OPPORTUNITY
INSTITUTIONAL CLASS FUND FUND VALUE FUND FUND
- ------------------- --------- --------- ---------- -----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,021.97 $1,020.43 $1,019.93 $1,015.37
Expenses Paid During Period 11/1/08-04/30/09 * .. $ 2.86 $ 4.41 $ 4.91 $ 9.49
Annualized Expense Ratio ........................ 0.57% 0.88% 0.98% 1.90%
SMALL CAP
VALUE
BALANCED MID-CAP OPPORTUNITY
INVESTOR CLASS FUND VALUE FUND FUND
- -------------- --------- ---------- -----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,020.63 $1,018.70 $1,018.30
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 4.21 $ 6.16 $ 6.56
Annualized Expense Ratio ........................ 0.84% 1.23% 1.31%
BALANCED MID-CAP
ADVISOR CLASS FUND VALUE FUND
- ------------- --------- ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,019.49 $1,022.17
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 5.36 $ 2.66
Annualized Expense Ratio ........................ 1.07% 0.53%
BALANCED LARGE CAP MID-CAP
AMR CLASS FUND GROWTH FUND VALUE FUND
- --------- --------- ----------- ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,023.21 $1,021.97 $1,020.53
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 1.61 $ 2.86 $ 4.31
Annualized Expense Ratio ........................ 0.32% 0.57% 0.86%
* Expenses are equal to the Fund's annualized expense ratios for the
six-month period multiplied by the average account value over the period,
multiplied by the number derived by dividing the number of days in the most
recent fiscal half-year ( 181 ) by days in the year ( 365 ) to reflect the
half year period.
10
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2009 (UNAUDITED)
SHARES VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
COMMON STOCKS - 53.73%
CONSUMER DISCRETIONARY - 4.61%
HOTELS, RESTAURANTS & LEISURE - 0.83%
Carnival Corp. ............................... 155,300 $ 4,174
Wyndham Worldwide Corp. ...................... 143,200 1,673
------------
5,847
------------
HOUSEHOLD DURABLES - 0.33%
Fortune Brands, Inc. ......................... 60,000 2,359
------------
INTERNET & CATALOG RETAIL - 0.30%
eBay, Inc. ## ................................ 128,000 2,108
------------
MEDIA - 0.83%
CBS Corp. .................................... 236,700 1,666
Interpublic Group of Cos., Inc. ## ........... 240,900 1,508
Walt Disney Co. Ltd. ......................... 121,000 2,650
------------
5,824
------------
MULTILINE RETAIL - 1.00%
J.C. Penney Company, Inc. .................... 109,400 3,358
Target Corp. ................................. 67,700 2,793
Wal-Mart Stores, Inc. ........................ 18,200 917
------------
7,068
------------
SPECIALTY RETAIL - 1.32%
Gap, Inc. .................................... 118,600 1,843
The Home Depot, Inc. ......................... 256,050 6,739
Limited Brands, Inc. ......................... 62,900 719
------------
9,301
------------
TOTAL CONSUMER DISCRETIONARY .................... 32,507
------------
CONSUMER STAPLES - 5.11%
BEVERAGES - 1.16%
Coca-Cola Co. ................................ 67,100 2,889
Diageo plc, ADR .............................. 68,200 3,263
PepsiCo, Inc. ................................ 41,200 2,050
------------
8,202
------------
FOOD & DRUG RETAILING - 0.41%
Safeway, Inc. ................................ 147,000 2,903
------------
FOOD PRODUCTS - 0.71%
H.J. Heinz Co. ............................... 46,500 1,601
Kraft Foods, Inc. ............................ 70,045 1,639
Unilever plc, ADR ............................ 89,000 1,732
------------
4,972
------------
SHARES VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
HOUSEHOLD PRODUCTS - 0.19%
The Procter & Gamble Co. ..................... 27,700 $ 1,370
------------
TOBACCO - 2.64%
Altria Group, Inc. ........................... 103,000 1,682
Imperial Tobacco Group plc, ADR .............. 121,900 5,540
Lorillard, Inc. .............................. 21,000 1,326
Philip Morris International, Inc. ............ 277,000 10,027
------------
18,575
------------
TOTAL CONSUMER STAPLES .......................... 36,022
------------
ENERGY - 4.58%
OIL & GAS - 4.58%
Chevron Corp. ................................ 101,428 6,704
ConocoPhillips ............................... 230,376 9,445
Devon Energy Corp. ........................... 87,900 4,558
Duke Energy Corp. ............................ 178,000 2,458
Occidental Petroleum Corp. ................... 69,600 3,918
Royal Dutch Shell plc, ADR ................... 115,100 5,237
------------
TOTAL ENERGY .................................... 32,320
------------
FINANCIALS - 9.23%
BANKS - 5.45%
Bank of America Corp. ........................ 725,480 6,478
Bank of New York Mellon Corp. ................ 40,100 1,022
Citigroup, Inc. .............................. 241,042 735
Comerica, Inc. ............................... 39,700 833
JP Morgan Chase & Co. ........................ 361,234 11,921
KeyCorp ...................................... 223,257 1,373
PNC Financial Services Group, Inc. ........... 148,858 5,910
SunTrust Banks, Inc. ......................... 30,000 433
U.S. Bancorp ................................. 118,560 2,160
Washington Mutual, Inc. ...................... 468,800 --
Wells Fargo & Co. ............................ 376,098 7,526
------------
38,391
------------
DIVERSIFIED FINANCIALS - 1.01%
American Express Co. ......................... 204,800 5,165
Capital One Financial Corp. .................. 69,700 1,167
SLM Corp. ## + ............................... 165,200 798
------------
7,130
------------
INSURANCE - 2.77%
ACE Ltd. ..................................... 77,500 3,590
Allstate Corp. ............................... 49,600 1,157
American International Group, Inc. + ......... 88,000 121
Conseco, Inc. ## ............................. 95,500 153
Genworth Financial, Inc. ..................... 149,900 354
See accompanying notes
11
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2009 (UNAUDITED)
SHARES VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Hartford Financial Services Group, Inc. ...... 33,000 $ 378
MetLife, Inc. ................................ 186,788 5,557
Prudential Financial, Inc. ................... 31,300 904
Travelers Cos., Inc. ......................... 120,800 4,970
XL Capital Ltd. .............................. 244,500 2,325
------------
19,509
------------
TOTAL FINANCIALS ................................ 65,030
------------
HEALTH CARE - 6.99%
HEALTH CARE EQUIPMENT & SUPPLIES - 0.33%
Baxter International, Inc. ................... 24,000 1,164
Zimmer Holdings, Inc. ## ..................... 26,700 1,175
------------
2,339
------------
HEALTH CARE PROVIDERS & SERVICES - 1.24%
Cardinal Health, Inc. ........................ 69,100 2,335
CIGNA Corp. .................................. 153,900 3,033
UnitedHealth Group, Inc. ..................... 72,300 1,700
WellPoint, Inc. ## ........................... 39,000 1,668
------------
8,736
------------
PHARMACEUTICALS - 5.42%
Amgen, Inc. ## ............................... 22,300 1,081
Bristol-Myers Squibb Co. ..................... 421,000 8,083
Eli Lilly & Co. .............................. 90,000 2,963
Johnson & Johnson ............................ 63,300 3,314
Merck & Co., Inc. ............................ 120,000 2,909
Pfizer, Inc. ................................. 444,700 5,941
Schering-Plough Corp. ........................ 185,600 4,273
Wyeth Corp. .................................. 226,700 9,612
------------
38,176
------------
TOTAL HEALTH CARE ............................... 49,251
------------
INDUSTRIALS - 8.47%
AEROSPACE & DEFENSE - 2.02%
Boeing Co. ................................... 96,100 3,849
Northrop Grumman Corp. ....................... 71,200 3,443
Raytheon Co. ................................. 128,200 5,798
United Technologies Corp. .................... 23,600 1,153
------------
14,243
------------
AIR FREIGHT & COURIERS - 0.71%
FedEx Corp. .................................. 90,000 5,036
------------
INDUSTRIAL CONGLOMERATES - 3.10%
3M Co. ....................................... 69,900 4,026
General Electric Co. ......................... 447,300 5,659
Honeywell International, Inc. ................ 250,500 7,818
Textron, Inc. ................................ 100,000 1,073
SHARES VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Tyco International Ltd. ...................... 139,025 $ 3,303
------------
21,879
------------
MACHINERY - 2.16%
Caterpillar, Inc. + .......................... 40,000 1,423
Cummins, Inc. ................................ 46,400 1,577
Eaton Corp. .................................. 40,300 1,765
Illinois Tool Works, Inc. .................... 143,900 4,720
ITT Industries, Inc. ......................... 77,000 3,158
PACCAR, Inc. + ............................... 72,200 2,559
------------
15,202
------------
TRANSPORTATION INFRASTRUCTURE - 0.48%
Burlington Northern Santa Fe Corp. ........... 49,600 3,347
------------
TOTAL INDUSTRIALS ............................... 59,707
------------
INFORMATION TECHNOLOGY - 6.82%
COMMUNICATIONS EQUIPMENT - 0.71%
Alcatel-Lucent, ADR ## ....................... 504,000 1,260
Nokia Corp., ADR ............................. 264,000 3,733
------------
4,993
------------
COMPUTERS & PERIPHERALS - 2.20%
Hewlett-Packard Co. .......................... 185,400 6,670
International Business Machines Corp. ........ 85,600 8,835
------------
15,505
------------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.31%
Intel Corp. .................................. 364,600 5,753
Tyco Electronics Ltd. ........................ 200,025 3,489
------------
9,242
------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS - 0.19%
Texas Instruments, Inc. ...................... 75,800 1,369
------------
SOFTWARE - 2.41%
CA, Inc. ..................................... 263,674 4,548
Microsoft Corp. .............................. 463,900 9,399
Oracle Corp. ................................. 155,300 3,004
------------
16,951
------------
TOTAL INFORMATION TECHNOLOGY .................... 48,060
------------
MATERIALS - 2.11%
CHEMICALS - 1.85%
Air Products & Chemicals, Inc. ............... 24,000 1,581
Dow Chemical Co. ............................. 74,600 1,194
E. I. du Pont de Nemours & Co. ............... 173,900 4,852
Eastman Chemical Co. ......................... 50,100 1,988
PPG Industries, Inc. ......................... 78,500 3,458
------------
13,073
------------
See accompanying notes
12
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
METALS & MINING - 0.26%
Alcoa, Inc. .................................. 199,500 $ 1,809
------------
TOTAL MATERIALS ................................. 14,882
------------
TELECOMMUNICATION SERVICES - 2.78%
DIVERSIFIED TELECOMMUNICATION - 2.78%
AT&T, Inc. ................................... 453,677 11,623
Fairpoint Communications, Inc. ............... 3,428 4
Verizon Communications, Inc. ................. 263,728 8,001
------------
TOTAL TELECOMMUNICATION SERVICES ................ 19,628
------------
UTILITIES - 3.03%
ELECTRIC UTILITIES - 2.54%
CenterPoint Energy, Inc. ..................... 162,000 1,724
Constellation Energy Group, Inc. ............. 48,100 1,158
Dominion Resources, Inc. ..................... 105,300 3,176
Edison International ......................... 38,500 1,098
Entergy Corp. ................................ 42,400 2,746
Exelon Corp. ................................. 78,200 3,607
FPL Group, Inc. .............................. 46,600 2,506
Public Service Enterprise Group, Inc. ........ 64,000 1,910
------------
17,925
------------
GAS UTILITIES - 0.49%
Spectra Energy Corp. ......................... 236,100 3,424
------------
TOTAL UTILITIES ................................. 21,349
------------
TOTAL COMMON STOCKS ............................. 378,756
------------
PREFERRED STOCKS - 0.16%
FINANCIALS - 0.16%
BANKS - 0.16%
Citigroup, Inc. .............................. 62,500 1,111
------------
PAR
AMOUNT
----------
CORPORATE OBLIGATIONS - 17.55%
AEROSPACE & DEFENSE - 0.08%
Raytheon Co.,
5.375%, Due 4/1/2013 ...................... $ 550 571
------------
BANKS - 1.55%
Bank of America Corp.,
7.80%, Due 9/15/2016 ...................... 900 620
6.00%, Due 9/1/2017 ....................... 400 335
5.75%, Due 12/1/2017 ...................... 875 715
Bank of New York Mellon Corp.,
4.95%, Due 11/1/2012 ...................... 355 368
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
5.125%, Due 8/27/2013 ..................... $ 400 $ 415
Bank One Corp.,
5.90%, Due 11/15/2011 ..................... 820 832
4.90%, Due 4/30/2015 ...................... 550 494
BP Capital Markets plc,
3.125%, Due 3/10/2012 ..................... 415 421
Citigroup, Inc.,
5.125%, Due 2/14/2011 ..................... 2,175 2,038
6.125%, Due 11/21/2017 .................... 960 791
Fifth Third Bancorp,
8.25%, Due 3/1/2038 ....................... 1,500 877
ING Bank, NV,
5.125%, Due 5/1/2015 ++ ................... 450 396
JP Morgan Chase & Co.,
6.00%, Due 1/15/2018 ...................... 500 486
Wachovia Corp.,
5.70%, Due 8/1/2013 ....................... 180 176
Washington Mutual Finance Corp.,
6.875%, Due 5/15/2011 ..................... 660 602
Wells Fargo & Co.,
5.25%, Due 10/23/2012 ..................... 840 843
5.625%, Due 12/11/2017 .................... 525 489
------------
10,898
------------
BASIC MATERIALS - 0.16%
ArcelorMittal,
6.125%, Due 6/1/2018 ...................... 365 294
EI Du Pont de Nemours & Co.,
5.875%, Due 1/15/2014 ..................... 560 597
Lubrizol Corp.,
8.875%, Due 2/1/2019 ...................... 185 201
------------
1,092
------------
COMMUNICATIONS - 1.80%
Alltel Corp.,
7.00%, Due 7/1/2012 ....................... 300 317
British Telecommunications plc,
8.625%, Due 12/15/2010 # .................. 575 601
Comcast Cable Communications Holdings, Inc.,
8.375%, Due 3/15/2013 ..................... 850 937
Comcast Corp.,
5.30%, Due 1/15/2014 ...................... 410 414
5.875%, Due 2/15/2018 ..................... 305 302
6.45%, Due 3/15/2037 ...................... 2,630 2,438
Nokia Corp.,
5.375%, Due 5/15/2019 ..................... 600 594
Rogers Communications, Inc.,
6.80%, Due 8/15/2018 ...................... 350 367
See accompanying notes
13
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Time Warner Cable, Inc.,
8.25%, Due 2/14/2014 ...................... $ 300 $ 329
5.85%, Due 5/1/2017 ....................... 1,055 1,014
7.30%, Due 7/1/2038 ....................... 1,920 1,919
Verizon Wireless Capital, LLC,
8.50%, Due 11/15/2018 ++ .................. 920 1,102
Viacom, Inc.,
6.875%, Due 4/30/2036 ..................... 2,880 2,349
------------
12,683
------------
CONSUMER DISCRETIONARY - 0.58%
Best Buy Co., Inc.,
6.75%, Due 7/15/2013 ...................... 415 410
Lowe's Companies, Inc.,
5.50%, Due 10/15/2035 ..................... 210 171
6.65%, Due 9/15/2037 ...................... 170 170
Target Corp.,
6.50%, Due 10/15/2037 ..................... 445 386
Walgreen Co.,
5.25%, Due 1/15/2019 ...................... 390 388
Wal-Mart Stores, Inc.,
7.55%, Due 2/15/2030 ...................... 425 490
6.50%, Due 8/15/2037 ...................... 1,340 1,421
6.20%, Due 4/15/2038 ...................... 656 683
------------
4,119
------------
CONSUMER STAPLES - 0.61%
Altria Group, Inc.,
9.70%, Due 11/10/2018 ..................... 365 427
Archer-Daniels-Midland Co.,
6.45%, Due 1/15/2038 ...................... 350 356
Coca-Cola Enterprises, Inc.,
7.375%, Due 3/3/2014 ...................... 175 200
Dr Pepper Snapple Group, Inc.,
6.82%, Due 5/1/2018 ....................... 250 243
Kellogg Co.,
4.25%, Due 3/6/2013 ....................... 500 505
Kraft Foods, Inc.,
6.75%, Due 2/19/2014 ...................... 300 327
6.50%, Due 8/11/2017 ...................... 240 249
7.00%, Due 8/11/2037 ...................... 1,580 1,553
Kroger Co.,
7.50%, Due 1/15/2014 ...................... 190 212
Safeway, Inc.,
6.25%, Due 3/15/2014 ...................... 180 191
------------
4,263
------------
ENERGY - 1.51%
Cameron International Corp.,
6.375%, Due 7/15/2018 ..................... 215 188
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Canadian Natural Resources Ltd.,
6.70%, Due 7/15/2011 ...................... $ 410 $ 425
6.25%, Due 3/15/2038 ...................... 425 346
ConocoPhillips,
5.20%, Due 5/15/2018 ...................... 425 417
5.75%, Due 2/1/2019 ....................... 335 342
6.50%, Due 2/1/2039 ....................... 705 699
Consolidated Natural Gas Co.,
6.00%, Due 10/15/2010 ..................... 495 511
Energy Transfer Partners LP,
8.50%, Due 4/15/2014 ...................... 300 324
9.00%, Due 4/15/2019 ...................... 260 284
EOG Resources Canada, Inc.,
4.75%, Due 3/15/2014 ++ ................... 550 551
Marathon Oil Corp.,
6.00%, Due 10/1/2017 ...................... 445 424
Shell International Finance BV,
6.375%, Due 12/15/2038 .................... 2,180 2,320
TransCanada Pipelines Ltd.,
7.625%, Due 1/15/2039 ..................... 390 427
Transocean, Inc.,
6.80%, Due 3/15/2038 ...................... 3,170 3,034
Valero Energy Corp.,
9.375%, Due 3/15/2019 ..................... 155 173
6.625%, Due 6/15/2037 ..................... 185 146
------------
10,611
------------
FINANCE - 2.21%
American Express Co.,
8.15%, Due 3/19/2038 ...................... 325 308
American Express Credit Corp.,
5.875%, Due 5/2/2013 ...................... 475 468
American General Finance Corp.,
4.875%, Due 5/15/2010 ..................... 500 332
4.00%, Due 3/15/2011 ...................... 630 319
Ameriprise Financial, Inc.,
5.35%, Due 11/15/2010 ..................... 975 961
Bear Stearns Cos., Inc.,
6.40%, Due 10/2/2017 ...................... 555 540
7.25%, Due 2/1/2018 ....................... 340 347
CIT Group, Inc.,
4.75%, Due 12/15/2010 ..................... 270 200
CME Group, Inc.,
5.40%, Due 8/1/2013 ....................... 475 492
Countrywide Home Loans, Inc.,
4.00%, Due 3/22/2011 ...................... 140 131
General Electric Capital Corp.,
4.375%, Due 3/3/2012 ...................... 700 684
5.65%, Due 6/9/2014 ....................... 1,050 1,043
See accompanying notes
14
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
5.625%, Due 5/1/2018 ...................... $ 500 $ 436
6.875%, Due 1/10/2039 ..................... 390 306
Goldman Sachs Group, Inc.,
4.75%, Due 7/15/2013 ...................... 450 436
6.25%, Due 9/1/2017 ....................... 550 520
5.95%, Due 1/18/2018 ...................... 280 260
6.75%, Due 10/1/2037 ...................... 1,402 1,069
HSBC Finance Corp.,
5.25%, Due 1/14/2011 ...................... 1,700 1,650
International Lease Finance Corp.,
5.75%, Due 6/15/2011 ...................... 475 362
JP Morgan Chase & Co.,
6.75%, Due 2/1/2011 ....................... 1,075 1,115
Korea Development Bank,
8.00%, Due 1/23/2014 ...................... 900 945
Merrill Lynch & Co., Inc.,
5.45%, Due 2/5/2013 ....................... 340 298
6.875%, Due 4/25/2018 ..................... 250 211
6.11%, Due 1/29/2037 ...................... 425 248
Novartis Capital Corp.,
4.125%, Due 2/10/2014 ..................... 560 580
Novartis Securities Investment Ltd.,
5.125%, Due 2/10/2019 ..................... 1,164 1,192
SLM Corp.,
5.375%, Due 1/15/2013 ..................... 185 124
------------
15,577
------------
HEALTH CARE - 0.72%
Amgen, Inc.,
6.40%, Due 2/1/2039 ....................... 445 448
Covidien International Finance SA,
5.45%, Due 10/15/2012 ..................... 360 374
6.55%, Due 10/15/2037 ..................... 1,500 1,480
UnitedHealth Group, Inc.,
5.25%, Due 3/15/2011 ...................... 865 879
6.625%, Due 11/15/2037 .................... 2,000 1,654
6.875%, Due 2/15/2038 ..................... 285 248
------------
5,083
------------
INDUSTRIALS - 2.47%
American Honda Finance Corp.,
4.625%, Due 4/2/2013 ++ ................... 425 380
Burlington Northern Santa Fe Corp.,
5.75%, Due 3/15/2018 ...................... 425 423
Canadian National Railway Co.,
5.55%, Due 5/15/2018 ...................... 500 506
5.55%, Due 3/1/2019 ....................... 175 178
Caterpillar Financial Services Corp.,
4.85%, Due 12/7/2012 ...................... 265 264
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Con-way, Inc.,
8.875%, Due 5/1/2010 ...................... $ 1,850 $ 1,823
CRH America, Inc.,
6.00%, Due 9/30/2016 ...................... 985 769
Daimler Finance NA LLC,
7.75%, Due 1/18/2011 ...................... 1,000 1,010
5.875%, Due 3/15/2011 ..................... 450 445
5.75%, Due 9/8/2011 ....................... 550 540
Eaton Corp.,
5.60%, Due 5/15/2018 ...................... 340 317
FedEx Corp.,
8.00%, Due 1/15/2019 ...................... 900 974
Home Depot, Inc.,
5.20%, Due 3/1/2011 ....................... 445 453
Honeywell International, Inc.,
4.25%, Due 3/1/2013 ....................... 500 519
ITT Corp.,
4.90%, Due 5/1/2014 ....................... 845 856
John Deere Capital Corp.,
5.40%, Due 10/17/2011 ..................... 650 675
Koninklijke Philips Electronics NV,
5.75%, Due 3/11/2018 ...................... 335 336
Nissan Motor Acceptance Corp.,
5.625%, Due 3/14/2011 ++ .................. 500 456
Norfolk Southern Corp.,
5.75%, Due 4/1/2018 ....................... 425 419
Tyco Electronics Group SA,
6.55%, Due 10/1/2017 ...................... 2,057 1,583
7.125%, Due 10/1/2037 ..................... 1,750 1,067
Tyco International Finance SA,
8.50%, Due 1/15/2019 ...................... 240 257
Unilever Capital Corp.,
7.125%, Due 11/1/2010 ..................... 2,000 2,147
Union Pacific Corp.,
6.50%, Due 4/15/2012 ...................... 550 569
United Technologies Corp.,
6.125%, Due 7/15/2038 ..................... 210 209
Waste Management, Inc.,
7.375%, Due 3/11/2019 ..................... 255 259
------------
17,434
------------
INSURANCE - 0.69%
Aegon Funding Corp.,
5.75%, Due 12/15/2020 ..................... 450 369
American International Group, Inc.,
5.85%, Due 1/16/2018 ...................... 550 186
6.25%, Due 5/1/2036 ....................... 425 145
John Hancock Global Funding II,
7.90%, Due 7/2/2010 ++ .................... 25 26
See accompanying notes
15
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Liberty Mutual Insurance Co.,
7.875%, Due 10/15/2026 ++ .................... $ 1,500 $ 968
Lincoln National Corp.,
4.75%, Due 2/15/2014 ......................... 245 157
MetLife, Inc.,
5.375%, Due 12/15/2012 ....................... 660 628
6.375%, Due 6/15/2034 ........................ 450 345
Metropolitan Life Global Funding I,
4.625%, Due 8/19/2010 ++ ..................... 900 875
Prudential Financial, Inc.,
4.50%, Due 7/15/2013 ......................... 550 447
5.10%, Due 9/20/2014 ......................... 550 435
Willis North America, Inc.,
6.20%, Due 3/28/2017 ......................... 360 261
------------
4,842
------------
PHARMACEUTICALS - 1.48%
Amgen, Inc.,
6.90%, Due 6/1/2038 .......................... 1,480 1,587
AstraZeneca plc,
6.45%, Due 9/15/2037 ......................... 1,880 2,024
Biogen Idec, Inc.,
6.875%, Due 3/1/2018 ......................... 1,500 1,466
Bristol-Myers Squibb Co.,
5.45%, Due 5/1/2018 .......................... 250 256
6.125%, Due 5/1/2038 ......................... 875 890
GlaxoSmithKline Capital, Inc.,
5.65%, Due 5/15/2018 ......................... 250 260
6.375%, Due 5/15/2038 ........................ 1,370 1,411
Hospira, Inc.,
6.05%, Due 3/30/2017 ......................... 360 323
Pfizer, Inc.,
4.45%, Due 3/15/2012 ......................... 770 809
5.35%, Due 3/15/2015 ......................... 420 452
Wyeth Corp.,
5.50%, Due 2/1/2014 .......................... 890 955
------------
10,433
------------
REAL ESTATE - 0.25%
Equity Residential,
5.125%, Due 3/15/2016 ........................ 365 301
ProLogis,
5.50%, Due 4/1/2012 .......................... 450 366
5.625%, Due 11/15/2016 ....................... 550 368
Simon Property Group LP,
5.30%, Due 5/30/2013 ......................... 425 379
5.75%, Due 12/1/2015 ......................... 460 378
------------
1,792
------------
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
TECHNOLOGY - 1.02%
Cisco Systems, Inc.,
5.90%, Due 2/15/2039 ...................... $ 1,420 $ 1,344
Computer Sciences Corp.,
5.50%, Due 3/15/2013 ...................... 190 189
6.50%, Due 3/15/2018 ...................... 495 483
Dell, Inc.,
6.50%, Due 4/15/2038 ...................... 500 413
Hewlett-Packard Co.,
4.25%, Due 2/24/2012 ...................... 585 607
4.50%, Due 3/1/2013 ....................... 425 440
6.125%, Due 3/1/2014 ...................... 460 506
International Business Machines Corp.,
7.625%, Due 10/15/2018 .................... 770 913
Oracle Corp.,
6.50%, Due 4/15/2038 ...................... 1,055 1,076
United Technologies Corp.,
6.125%, Due 2/1/2019 ...................... 950 1,023
Xerox Corp.,
5.65%, Due 5/15/2013 ...................... 250 225
------------
7,219
------------
TELEPHONE - 0.97%
America Movil, S.A.B. de C.V.,
6.375%, Due 3/1/2035 ...................... 425 343
AT&T Wireless Services, Inc.,
8.75%, Due 3/1/2031 ....................... 445 509
AT&T, Inc.,
5.10%, Due 9/15/2014 ...................... 985 1,024
5.625%, Due 6/15/2016 ..................... 550 560
5.50%, Due 2/1/2018 ....................... 300 299
6.80%, Due 5/15/2036 ...................... 250 242
6.40%, Due 5/15/2038 ...................... 1,840 1,725
Deutsche Telekom AG,
8.50%, Due 6/15/2010 ...................... 380 399
Telefonica Emisiones SAU,
5.984%, Due 6/20/2011 ..................... 380 396
Verizon Communications, Inc.,
5.50%, Due 4/1/2017 ....................... 500 498
6.90%, Due 4/15/2038 ...................... 425 420
Vodafone Group plc,
6.15%, Due 2/27/2037 ...................... 425 411
------------
6,826
------------
UTILITIES - 1.45%
American Water Capital Corp.,
6.593%, Due 10/15/2037 .................... 1,492 1,120
Columbus Southern Power Co.,
5.50%, Due 3/1/2013 ....................... 660 668
See accompanying notes
16
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Dominion Resources, Inc.,
Series A, 5.60%, Due 11/15/2016 ........... $ 500 $ 490
8.875%, Due 1/15/2019 ..................... 120 139
Duke Energy Carolinas LLC,
5.10%, Due 4/15/2018 ...................... 500 508
Duke Energy Corp.,
6.30%, Due 2/1/2014 ....................... 270 285
Duke Energy Indiana, Inc.,
6.05%, Due 6/15/2016 ...................... 520 530
MidAmerican Energy Holdings Co.,
5.875%, Due 10/1/2012 ..................... 960 992
6.125%, Due 4/1/2036 ...................... 425 369
Pacific Gas & Electric Co.,
6.25%, Due 12/1/2013 ...................... 175 190
Public Service Enterprise Group, Inc.,
6.95%, Due 6/1/2012 ....................... 845 865
Southern Power Co.,
6.25%, Due 7/15/2012 ...................... 705 730
Union Electric Co.,
6.70%, Due 2/1/2019 ....................... 325 320
Virginia Electric and Power Co.,
5.40%, Due 4/30/2018 ...................... 500 510
8.875%, Due 11/15/2038 .................... 955 1,235
Westar Energy, Inc.,
6.00%, Due 7/1/2014 ....................... 175 175
Wisconsin Electric Power Co.,
6.25%, Due 12/1/2015 ...................... 280 296
Xcel Energy, Inc.,
5.613%, Due 4/1/2017 ...................... 869 828
------------
10,250
------------
TOTAL CORPORATE OBLIGATIONS ..................... 123,693
------------
NON-AGENCY MORTGAGE-BACKED
OBLIGATIONS - 2.64%
COMMERCIAL MORTGAGE-BACKED SECURITY - 1.38%
Banc of America Commercial Mortgage, Inc.,
2005-6 A1, 5.001%, Due 9/10/2047 .......... 486 485
2007-2 A2, 5.634%, Due 4/10/2049 .......... 1,100 941
Bear Stearns Commercial Mortgage Securities,
Inc.,
2006-T22 A2, 5.63%, Due 4/12/2038 ......... 905 844
2004-PWR5 A4, 4.831%, Due 7/11/2042 ....... 2,010 1,772
2005-T20 A2, 5.127%, Due 10/12/2042 ....... 875 845
Citigroup Commercial Mortgage Trust,
2004-C2 A3, 4.38%, Due 10/15/2041 ......... 995 903
GE Capital Commercial Mortgage Corp.,
2003-C2 A2, 4.17%, Due 7/10/2037 .......... 127 125
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
JP Morgan Chase Commercial Mortgage
Securities Corp.,
2004-CBX A4, 4.529%, Due 1/12/2037 ........ $ 555 $ 486
2005-LDP3 A1, 4.655%, Due 8/15/2042 ....... 128 128
2005-LDP1 A2, 4.625%, Due 3/15/2046 ....... 1,033 1,001
2007-CB19 A4, 5.937%, Due 2/12/2049 ....... 800 571
2007-CB20 A2, 5.629%, Due 2/12/2051 ....... 850 727
LB-UBS Commercial Mortgage Trust,
2004-C1 A4, 5.424%, Due 2/15/2040 ......... 650 469
Wachovia Bank Commercial Mortgage Trust,
2007-C32 A2, 5.924%, Due 6/15/2049 ........ 530 456
------------
9,753
------------
WHOLE LOAN COLLATERALIZED MORTGAGE
OBLIGATIONS - 1.26%
Chase Mortgage Finance Corp.,
2006-A1 A1, 6.037%, Due 9/25/2036 ss ...... 1,280 982
Citicorp Mortgage Securities, Inc.,
2006-3 2A1, 5.50%, Due 6/25/2021 .......... 1,125 991
Citigroup/Deutsche Bank Commercial Mortgage
Trust,
5.886%, Due 11/15/2044 .................... 1,690 1,317
Countrywide Home Loan Mortgage Pass Through
Trust,
2007-18 A1, 6.00%, Due 9/25/2037 .......... 1,410 952
JP Morgan Chase Commercial Mortgage Securities
Corp.,
2006-LDP9 A3, 5.336%, Due 5/15/2047 ....... 615 475
JP Morgan Mortgage Trust,
7.00%, Due 8/25/2037 ...................... 777 505
Morgan Stanley Capital I,
5.692%, Due 4/15/2049 ..................... 1,060 723
Prime Mortgage Trust,
2005-2, 5.25%, Due 7/25/2020 .............. 1,504 1,512
Wells Fargo Mortgage Backed Securities Trust,
2006-11 A8, 6.00%, Due 9/25/2036 .......... 771 613
2007-7 A1, 6.00%, Due 6/25/2037 ........... 1,384 810
------------
8,880
------------
TOTAL NON-AGENCY MORTGAGE-BACKED OBLIGATIONS .... 18,633
------------
ASSET-BACKED SECURITIES - 0.57%
American Express Credit Account Master Trust,
2006-2 A, 5.35%, Due 1/15/2014 ............ 1,700 1,709
Capital Auto Receivables Asset Trust,
2006-SN1A A4A, 5.32%, Due 3/20/2010 ++ .... 642 640
Capital One Multi-Asset Execution Trust,
2006-A10 A10, 5.15%, Due 6/16/2014 ........ 1,250 1,248
See accompanying notes
17
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
Volkswagen Auto Loan Enhanced Trust,
2008-2 A4A, 6.24%, Due 7/20/2015 .......... $ 400 $ 410
------------
TOTAL ASSET-BACKED SECURITIES ................... 4,007
------------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS - 9.16%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 3.10%
4.50%, Due 3/1/2019 ....................... 715 739
5.00%, Due 10/1/2020 ...................... 291 302
5.00%, Due 4/1/2023 ....................... 1,422 1,472
5.50%, Due 1/1/2024 ....................... 666 693
5.00%, Due 8/1/2033 ....................... 1,471 1,517
5.50%, Due 2/1/2034 ....................... 1,361 1,412
5.00%, Due 3/1/2034 ....................... 1,141 1,176
6.00%, Due 6/1/2034 ....................... 829 869
6.00%, Due 8/1/2034 ....................... 707 743
5.00%, Due 8/1/2035 ....................... 1,044 1,075
5.00%, Due 9/1/2035 ....................... 1,324 1,363
5.00%, Due 9/1/2035 ....................... 740 762
6.00%, Due 8/1/2036 ....................... 1,447 1,513
5.50%, Due 11/1/2036 ...................... 1,296 1,342
5.50%, Due 4/1/2037 ....................... 752 779
5.50%, Due 5/1/2037 ....................... 893 925
6.00%, Due 9/1/2037 ....................... 501 524
5.00%, Due 3/1/2038 ....................... 1,656 1,704
6.00%, Due 3/1/2038 ....................... 2,802 2,928
------------
21,838
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 5.36%
5.50%, Due 2/1/2014 ....................... 293 308
6.00%, Due 4/1/2016 ....................... 249 263
5.00%, Due 12/1/2017 ...................... 688 718
4.50%, Due 9/1/2018 ....................... 417 432
4.00%, Due 8/1/2020 ....................... 883 898
5.50%, Due 5/1/2023 ....................... 209 217
5.00%, Due 12/1/2023 ...................... 636 659
5.00%, Due 3/1/2024 ....................... 722 747
5.00%, Due 3/1/2034 ....................... 1,525 1,575
4.50%, Due 9/1/2034 ....................... 695 709
5.50%, Due 12/1/2035 ...................... 492 511
5.50%, Due 12/1/2035 ...................... 380 395
5.50%, Due 1/1/2036 ....................... 1,215 1,262
5.50%, Due 2/1/2036 ....................... 815 846
5.00%, Due 2/1/2036 ....................... 750 774
5.00%, Due 3/1/2036 ....................... 1,365 1,408
5.50%, Due 4/1/2036 ....................... 1,049 1,089
6.00%, Due 9/1/2036 ....................... 922 965
6.50%, Due 9/1/2036 ....................... 1,951 2,072
5.50%, Due 12/1/2036 ...................... 1,547 1,605
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
5.50%, Due 2/1/2037 ....................... $ 1,503 $ 1,559
5.50%, Due 8/1/2037 ....................... 960 998
6.00%, Due 8/1/2037 ....................... 1,274 1,333
6.50%, Due 8/1/2037 ....................... 327 347
6.00%, Due 11/1/2037 ...................... 682 713
5.50%, Due 3/1/2038 ....................... 5,432 5,634
5.00%, Due 4/1/2038 ....................... 4,580 4,715
5.00%, Due 6/1/2038 ....................... 1,923 1,980
5.50%, Due 6/1/2038 ....................... 2,413 2,503
6.00%, Due 9/1/2038 ....................... 557 583
------------
37,818
------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 0.70%
7.00%, Due 12/15/2025 ..................... 270 290
4.201%, Due 8/16/2026 ..................... 602 612
6.50%, Due 8/15/2027 ...................... 318 340
6.50%, Due 11/15/2027 ..................... 325 348
7.50%, Due 12/15/2028 ..................... 243 262
5.50%, Due 7/15/2033 ...................... 870 907
6.00%, Due 12/15/2033 ..................... 918 961
5.50%, Due 2/20/2034 ...................... 1,180 1,227
------------
4,947
------------
TOTAL U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS ... 64,603
------------
U.S. AGENCY OBLIGATIONS - 7.49%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 4.00%
4.50%, Due 1/15/2015 + .................... 24,090 26,372
6.25%, Due 7/15/2032 ...................... 1,500 1,826
28,198
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 3.49%
5.125%, Due 1/2/2014 ...................... 645 663
4.625%, Due 10/15/2014 .................... 1,000 1,100
5.375%, Due 6/12/2017 + ................... 2,650 2,985
6.25%, Due 5/15/2029 ...................... 12,200 14,672
6.00%, Due 4/18/2036 ...................... 5,065 5,198
------------
24,618
------------
TOTAL U.S. AGENCY OBLIGATIONS ................... 52,816
------------
U.S. TREASURY OBLIGATIONS - 3.06%
1.375%, Due 2/15/2012 ..................... 1,900 1,905
1.75%, Due 3/31/2014 ...................... 3,845 3,802
2.75%, Due 2/15/2019 ...................... 3,220 3,119
7.875%, Due 2/15/2021 ..................... 1,200 1,674
6.25%, Due 8/15/2023 ...................... 1,400 1,750
6.875%, Due 8/15/2025 ..................... 580 785
5.25%, Due 11/15/2028 ..................... 750 865
4.75%, Due 2/15/2037 ...................... 800 889
See accompanying notes
18
AMERICAN BEACON BALANCED FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
---------- ------------
(DOLLARS IN THOUSANDS)
4.50%, Due 5/15/2038 ...................... $ 6,275 $ 6,752
------------
TOTAL U.S. TREASURY OBLIGATIONS ................. 21,541
------------
SHARES
----------
SHORT TERM INVESTMENTS - 5.12%
American Beacon U.S. Government Money
Market Select Fund * ...................... 5,000,000 5,000
Columbia Government Reserve Fund ............. 27,268,781 27,269
PAR
AMOUNT
----------
U.S. Treasury,
0.12%, Due 6/11/2009 @ .................... $ 3,819 3,818
------------
TOTAL SHORT TERM INVESTMENTS 36,087
------------
SHARES
----------
SECURITIES LENDING COLLATERAL - 0.80%
American Beacon U.S. Government Money
Market Select Fund * ....................... 1,209,900 1,210
State Street Navigator Securities Lending
Prime Portfolio ............................ 4,425,898 4,426
------------
TOTAL SECURITIES LENDING COLLATERAL 5,636
------------
TOTAL INVESTMENTS 100.28% - (COST $821,527) 706,883
LIABILITIES, NET OF OTHER ASSETS - (0.28%) (1,989)
------------
TOTAL NET ASSETS - 100.00% $ 704,894
============
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $5,394 or 0.77% of net
assets. The Fund has no right to demand registration of these securities.
# Step Up/Down
ss. The coupon rate shown on floating or adjustable rate securities represents
the rate at period end. The due date on these types of securities reflects
the final maturity date.
* The Fund is affiliated by having the same investment advisor.
@ At April 30, 2009, security pledged as collateral for open futures
contracts.
FUTURES CONTRACTS
(DOLLARS IN THOUSANDS)
UNREALIZED
NUMBER OF EXPIRATION MARKET APPRECIATION/
CONTRACTS DATE VALUE (DEPRECIATION)
--------- ---------- ------- --------------
Emini S&P 500 Index .. 831 Jun 2009 $36,149 $3,328
======= ======
See accompanying notes
19
American Beacon Large Cap Growth Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
COMMON STOCKS - 94.66%
CONSUMER DISCRETIONARY - 10.98%
Hotels, Restaurants & Leisure - 1.47%
Carnival Corp. ..................................... 15,300 $ 412
McDonald's Corp. ................................... 7,735 412
------
824
------
Household Durables - 0.69%
Dolby Laboratories, Inc. ## ........................ 9,600 385
------
Internet & Catalog Retail - 0.87%
priceline.com, Inc. ## ............................. 5,000 485
------
Multiline Retail - 2.37%
Kohl's Corp. ## .................................... 7,800 354
Wal-Mart Stores, Inc. .............................. 19,239 969
------
1,323
------
Specialty Retail - 4.20%
AutoZone, Inc. ## .................................. 2,488 414
Best Buy Company, Inc. ............................. 19,961 766
Dollar Tree, Inc. ## ............................... 11,281 478
GameStop Corp. ## .................................. 14,080 425
Lowe's Companies, Inc. ............................. 12,200 262
------
2,345
------
Textiles & Apparel - 1.38%
Coach, Inc. ## ..................................... 31,418 770
------
Total Consumer Discretionary ........................ 6,132
------
CONSUMER STAPLES - 5.62%
Food & Drug Retailing - 1.66%
CVS Caremark Corp. ................................. 16,400 521
The Kroger Co. ..................................... 18,754 406
------
927
------
Food Products - 3.17%
General Mills, Inc. ................................ 16,861 855
H.J. Heinz Co. ..................................... 13,957 480
Kellogg Co. ........................................ 10,366 437
------
1,772
------
Household Products - 0.79%
Colgate-Palmolive Co. .............................. 7,432 438
------
Total Consumer Staples .............................. 3,137
------
ENERGY - 5.18%
Energy Equipment & Services - 2.47%
FMC Technologies, Inc. ## .......................... 9,400 322
Halliburton Co. .................................... 26,340 533
Transocean Ltd. ## ................................. 7,815 $ 527
------
1,382
------
Oil & Gas - 2.71%
Apache Corp. ....................................... 7,134 519
Murphy Oil Corp. ................................... 10,100 482
Petro-Canada ## .................................... 8,400 265
Petroleo Brasileiro S.A., ADR ...................... 7,300 245
------
1,511
------
Total Energy ........................................ 2,893
------
FINANCIALS - 6.41%
Banks - 0.83%
JP Morgan Chase & Co. .............................. 14,100 465
------
Diversified Financials - 5.58%
BlackRock, Inc. .................................... 2,800 410
Charles Schwab Corp. ............................... 36,900 682
Goldman Sachs Group, Inc. .......................... 1,100 142
IntercontinentalExchange, Inc. ## .................. 4,200 368
Mastercard, Inc. ................................... 3,200 587
Visa, Inc. ## ...................................... 14,300 929
------
3,118
------
Total Financials .................................... 3,583
------
HEALTH CARE - 17.55%
Biotechnology - 2.05%
Gilead Sciences, Inc. ## ........................... 25,036 1,147
------
Health Care Equipment & Supplies - 5.83%
Baxter International, Inc. ......................... 20,125 976
Becton, Dickinson & Co. ............................ 6,937 420
Illumina, Inc. ## .................................. 7,000 261
Mindray Medical International Ltd., ADR ............ 11,500 262
St. Jude Medical, Inc. ## .......................... 25,983 871
Varian Medical Systems, Inc. ## .................... 13,931 465
------
3,255
------
Health Care Providers & Services - 1.65%
Aetna, Inc. ........................................ 18,478 407
Express Scripts, Inc. ## ........................... 8,063 516
------
923
------
Pharmaceuticals - 8.02%
Abbott Laboratories ................................ 11,018 461
Amgen, Inc. ## ..................................... 10,380 503
Bristol-Myers Squibb Co. ........................... 23,637 454
Cephalon, Inc. ## .................................. 4,800 315
Eli Lilly & Co. .................................... 13,237 436
See accompanying notes
20
American Beacon Large Cap Growth Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
Johnson & Johnson ...................................... 9,149 $ 479
Medco Health Solutions, Inc. ## ........................ 26,700 1,163
Teva Pharmaceutical Industries Ltd., ADR ............... 15,300 671
------
4,482
------
Total Health Care ....................................... 9,807
------
INDUSTRIALS - 18.94%
Aerospace & Defense - 5.57%
General Dynamics Corp. ................................. 8,723 451
Goodrich Corp. ......................................... 12,788 566
Lockheed Martin Corp. .................................. 8,537 671
Precision Castparts Corp. .............................. 5,000 374
United Technologies Corp. .............................. 21,481 1,049
------
3,111
------
Air Freight & Couriers - 1.13%
Expeditors International of Washington, Inc. ........... 4,500 156
FedEx Corp. ............................................ 8,506 476
------
632
------
Commercial Services & Supplies - 4.01%
Apollo Group, Inc. ## .................................. 11,702 737
CH Robinson Worldwide, Inc. ............................ 5,000 266
H&R Block, Inc. ........................................ 29,339 444
ITT Educational Services, Inc. ## ...................... 7,892 795
------
2,242
------
Construction & Engineering - 0.79%
Fluor Corp. ............................................ 11,655 441
------
Industrial Conglomerates - 0.87%
Honeywell International, Inc. .......................... 15,587 487
------
Machinery - 2.47%
Danaher Corp. ## ....................................... 13,000 760
Flowserve Corp. ........................................ 9,152 621
------
1,381
------
Road & Rail - 3.27%
Norfolk Southern Corp. ................................. 13,348 476
Union Pacific Corp. .................................... 27,512 1,352
------
1,828
------
Trading Companies & Distributors - 0.83%
Fastenal Co. ........................................... 12,000 460
------
Total Industrials ....................................... 10,582
------
INFORMATION TECHNOLOGY - 24.51%
Communications Equipment - 4.98%
Cisco Systems, Inc. ## ................................. 36,400 703
Harris Corp. ........................................... 16,108 $ 492
Juniper Networks, Inc. ## .............................. 11,900 258
QUALCOMM, Inc. ......................................... 25,000 1,058
Research In Motion Ltd. ## ............................. 3,900 271
------
2,782
------
Computers & Peripherals - 7.75%
Apple Computer, Inc. ## ................................ 10,296 1,296
Dell, Inc. ## .......................................... 44,740 520
EMC Corp. ## ........................................... 39,855 499
Hewlett-Packard Co. .................................... 30,003 1,079
International Business Machines Corp. .................. 4,363 450
Western Digital Corp. ## ............................... 20,567 484
------
4,328
------
Internet Software & Services - 3.31%
Baidu, Inc., ADR ## .................................... 1,700 396
Equinix, Inc. ## ....................................... 6,000 421
Google, Inc. ## ........................................ 2,050 812
McAfee, Inc. ## ........................................ 5,900 222
------
1,851
------
IT Consulting & Services - 2.80%
Accenture Ltd. ......................................... 15,520 457
Affiliated Computer Services, Inc. ## .................. 8,576 415
Cognizant Technology Solutions Corp. ## ................ 28,000 694
------
1,566
------
Semiconductor Equipment & Products - 0.24%
Lam Research Corp. ## .................................. 4,800 134
------
Software - 5.43%
Activision Blizzard, Inc. ## ........................... 46,545 501
Adobe Systems, Inc. ## ................................. 10,200 279
Autodesk, Inc. ## ...................................... 6,800 136
Microsoft Corp. ........................................ 55,280 1,120
Oracle Corp. ........................................... 51,646 999
------
3,035
------
Total Information Technology ............................ 13,696
------
MATERIALS - 3.59%
Chemicals - 3.59%
Ecolab, Inc. ........................................... 6,800 262
Monsanto Co. ........................................... 15,360 1,304
The Mosaic Co. ......................................... 10,839 438
------
Total Materials ......................................... 2,004
------
See accompanying notes
21
American Beacon Large Cap Growth Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
TELECOMMUNICATION SERVICES - 1.39%
Wireless Telecommunication Services - 1.39%
America Movil, S.A.B. de C.V., ADR ............... 7,800 $ 256
American Tower Corp. ## .......................... 8,700 277
MetroPCS Communications, Inc. ## ................. 14,400 246
---------
Total Telecommunication Services .................. 779
---------
UTILITIES - 0.49%
Gas Utilities - 0.49%
Southwestern Energy Co. ## ....................... 7,600 272
---------
Total Common Stocks ............................... 52,885
---------
SHORT TERM INVESTMENTS - 5.22%
Columbia Government Reserve Fund ................. 2,302,795 2,303
Par
Amount
------
U.S. Treasury,
0.08%, Due 6/11/2009++ ......................... $ 614 614
---------
Total Short Term Investments ...................... 2,917
---------
TOTAL INVESTMENTS 99.88% - (Cost $56,908) ......... 55,802
OTHER ASSETS, NET OF LIABILITIES - 0.12% ........... 68
---------
TOTAL NET ASSETS - 100.00% ......................... $ 55,870
=========
Percentages are stated as a percent of net assets.
## Non-income producing security.
++ At April 30, 2009, security pledged as collateral for open futures
contracts.
Futures Contracts
(dollars in thousands)
Unrealized
Number of Expiration Market Appreciation/
Contracts Date Value (Depreciation)
--------- ---------- ----- --------------
Emini S&P 500 Index ........................................................ 67 Jun 2009 $2,915 $103
====== ====
See accompanying notes
22
American Beacon Mid-Cap Value Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
COMMON STOCKS - 95.15%
CONSUMER DISCRETIONARY - 23.04%
Audio/Video Products - 0.94%
Harman International Industries, Inc. .............. 28,425 $ 517
------
Auto Components - 2.70%
Advance Auto Parts, Inc. ........................... 19,100 836
Lear Corp. ## ...................................... 59,200 47
Magna International, Inc. .......................... 17,500 594
------
1,477
------
Hotels, Restaurants & Leisure - 2.30%
International Game Technology ...................... 71,500 883
Royal Caribbean Cruises Ltd. + ..................... 25,800 380
------
1,263
------
Household Durables - 3.93%
Black & Decker Corp. ............................... 18,400 741
Stanley Works ...................................... 24,300 924
Whirlpool Corp. + .................................. 10,775 487
------
2,152
------
Leisure Equipment & Products - 1.05%
Mattel, Inc. ....................................... 38,525 576
------
Media - 1.13%
Omnicom Group, Inc. ................................ 19,725 621
------
Multiline Retail - 1.86%
J.C. Penney Company, Inc. .......................... 33,275 1,021
------
Specialty Retail - 8.61%
Family Dollar Stores, Inc. ......................... 21,200 704
GameStop Corp. ## .................................. 31,800 959
Gildan Activewear, Inc. ## ......................... 41,875 480
Hanesbrands, Inc. ## + ............................. 40,300 663
Regis Corp. ........................................ 39,625 759
Rent-A-Center, Inc. ## ............................. 37,625 724
Sherwin-Williams Co. ............................... 7,700 436
------
4,725
------
Textiles & Apparel - 0.52%
Sealy Corp. ## ..................................... 80,525 285
------
Total Consumer Discretionary ........................ 12,637
------
CONSUMER STAPLES - 4.56%
Food Products - 1.82%
Del Monte Foods Co. ................................ 79,650 601
Sara Lee Corp. ..................................... 47,825 $ 398
------
999
------
Personal Products - 1.03%
Avon Products, Inc. ................................ 24,825 565
------
Tobacco - 1.71%
Lorillard, Inc. .................................... 7,600 480
Reynolds American, Inc. ............................ 12,100 460
------
940
------
Total Consumer Staples .............................. 2,504
------
ENERGY - 3.87%
Energy Equipment & Services - 1.44%
BJ Services Co. .................................... 56,775 789
------
Oil & Gas - 2.43%
El Paso Corp. ...................................... 74,700 515
Murphy Oil Corp. ................................... 17,200 821
------
1,336
------
Total Energy ........................................ 2,125
------
FINANCIALS - 18.74%
Banks - 4.80%
Comerica, Inc. ..................................... 23,525 494
First Horizon National Corp. ....................... 12,730 146
New York Community Bancorp, Inc. + ................ 34,900 395
People's United Financial, Inc. .................... 43,154 674
PNC Financial Services Group, Inc. ................. 19,003 754
Popular, Inc. + ................................... 59,175 169
------
2,632
------
Diversified Financials - 3.09%
Capital One Financial Corp. ........................ 29,200 489
Moody's Corp. + ................................... 30,525 901
SLM Corp. ## + ..................................... 62,700 303
------
1,693
------
Insurance - 9.18%
Axis Capital Holdings Ltd. ......................... 26,600 655
Conseco, Inc. ## ................................... 92,050 147
Delphi Financial Group, Inc. ....................... 47,800 826
First American Corp. ............................... 8,975 252
IPC Holdings Ltd. .................................. 15,125 394
Protective Life Corp. .............................. 46,725 400
RenaissanceRe Holdings Ltd. ........................ 14,575 709
Torchmark Corp. .................................... 25,425 746
Willis Group Holdings Ltd. ......................... 32,100 883
See accompanying notes
23
American Beacon Mid-Cap Value Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
XL Capital Ltd. .................................... 2,400 $ 23
-------
5,035
-------
Real Estate - 1.67%
Annaly Capital Management, Inc. .................... 65,100 916
-------
Total Financials .................................... 10,276
-------
HEALTH CARE - 11.78%
Biotechnology - 0.41%
Charles River Laboratories International,
Inc. ## .......................................... 8,050 222
-------
Health Care Equipment & Supplies - 1.50%
IMS Health, Inc. ................................... 47,625 598
Zimmer Holdings, Inc. ## ............................ 5,150 227
-------
825
-------
Health Care Providers & Services - 9.31%
Aetna, Inc. ........................................ 16,200 357
AmerisourceBergen Corp. ............................ 24,950 839
Cardinal Health, Inc. .............................. 16,700 564
CIGNA Corp. ........................................ 23,900 471
Coventry Health Care, Inc. ## ....................... 36,000 573
Mednax, Inc. ## ..................................... 13,850 497
Omnicare, Inc. ..................................... 37,300 959
Quest Diagnostics, Inc. ............................ 16,500 847
-------
5,107
-------
Pharmaceuticals - 0.56%
Mead Johnson Nutrition Co. ## ....................... 10,900 308
-------
Total Health Care ................................... 6,462
-------
INDUSTRIALS - 11.86%
Aerospace & Defense - 5.35%
Goodrich Corp. ..................................... 13,400 593
L-3 Communications Holdings, Inc. .................. 21,850 1,664
Spirit Aerosystems Holdings, Inc. ## ................ 53,350 680
-------
2,937
-------
Building Products - 1.13%
Armstrong World Industries, Inc. ## ................. 34,025 619
-------
Commercial Services & Supplies - 1.78%
Avery Dennison Corp. ............................... 25,100 721
Pitney Bowes, Inc. ................................. 10,300 253
-------
974
-------
Freight Transportation - 0.79%
Ryder System, Inc. ................................. 15,700 435
-------
Machinery - 2.81%
Brady Corp. ........................................ 13,525 $ 285
Eaton Corp. ........................................ 16,100 705
ITT Industries, Inc. ............................... 13,400 550
-------
1,540
-------
Total Industrials ................................... 6,505
-------
INFORMATION TECHNOLOGY - 14.18%
Communications Equipment - 3.53%
Alcatel-Lucent, ADR ## + ............................ 377,698 944
Motorola, Inc. ..................................... 179,200 991
-------
1,935
-------
Electronic Equipment & Instruments - 3.60%
Avnet, Inc. ## ...................................... 45,875 1,004
Tyco Electronics Ltd. .............................. 55,500 968
-------
1,972
-------
IT Consulting & Services - 3.75%
Alliance Data Systems Corp. ## + .................... 13,800 578
Computer Sciences Corp. ## .......................... 23,500 869
Tech Data Corp. ## .................................. 21,300 613
-------
2,060
-------
Semiconductor Equipment & Products - 1.92%
Lam Research Corp. ## ............................... 19,475 543
Microchip Technology, Inc. ......................... 22,300 513
-------
1,056
-------
Software - 1.38%
CA, Inc. ........................................... 43,725 754
-------
Total Information Technology ........................ 7,777
-------
UTILITIES - 7.12%
Electric Utilities - 4.75%
CenterPoint Energy, Inc. ........................... 52,300 557
Pinnacle West Capital Corp. ........................ 22,800 624
PNM Resources, Inc. ................................ 61,425 523
Xcel Energy, Inc. .................................. 48,800 900
-------
2,604
-------
Gas Utilities - 2.37%
MDU Resources Group, Inc. .......................... 28,550 502
Sempra Energy ...................................... 11,875 546
Spectra Energy Corp. ............................... 17,300 251
-------
1,299
-------
Total Utilities ..................................... 3,903
-------
Total Common Stocks ................................. 52,189
-------
See accompanying notes
24
American Beacon Mid-Cap Value Fund
Schedule of Investments
April 30, 2009 (Unaudited)
Shares Value
------ -----
(dollars in
thousands)
SHORT TERM INVESTMENTS - 5.85%
Columbia Government Reserve Fund ................... 2,607,561 $ 2,608
Par
Amount
------
U.S. Treasury,
0.07%, Due 6/11/2009++ ............................ $ 601 601
----------
Total Short Term Investments ......................... 3,209
----------
Shares
------
SECURITIES LENDING
COLLATERAL - 2.51%
American Beacon U.S. Government Money
Market Select Fund # ....................... 295,893 296
State Street Navigator Securities Lending
Prime Portfolio ............................ 1,082,399 1,082
----------
Total Securities Lending Collateral ............ 1,378
----------
TOTAL INVESTMENTS 103.51% - (Cost $77,611) ..... 56,776
LIABILITIES, NET OF OTHER ASSETS - (3.51%) ...... (1,925)
----------
TOTAL NET ASSETS - 100.00% ...................... $ 54,851
==========
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
++ At April 30, 2009, security pledged as collateral for open futures
contracts.
# The Fund is affiliated by having the same investment advisor.
Futures Contracts
(dollars in thousands)
Unrealized
Number of Expiration Market Appreciation/
Contracts Date Value (Depreciation)
--------- ---------- ------ --------------
Emini S&P 400 Index ....................................................... 57 Jun 2009 $3,192 $290
====== ====
See accompanying notes
25
AMERICAN BEACON SMALL CAP VALUE OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
Shares Value
-------- -------
(dollars in thousands)
SHORT-TERM INVESTMENTS - 101.99%
iShares Russell 2000 Value Index Fund 7,745 $ 353
-------
TOTAL INVESTMENTS - 101.99% (Cost $363) 353
LIABILITIES, NET OF OTHER ASSETS - (1.99%) (7)
TOTAL NET ASSETS - 100.00% $ 346
=======
See accompanying notes
26
AMERICAN BEACON FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 2009 (Unaudited)(in thousands except share and per share amounts)
SMALL CAP
VALUE
BALANCED LARGE CAP MID-CAP OPPORTUNITY
FUND GROWTH FUND VALUE FUND FUND
------------ ------------- ---------- ------------
ASSETS:
Investments in unaffiliated securities, at value A C ..... $ 700,673 $ 55,802 $ 56,480 $ 353
Investments in affiliated securities, at value B ......... 6,210 -- 296 --
Receivable for investments sold .......................... 2,009 400 282 3
Dividends and interest receivable ........................ 4,184 41 58 --
Receivable for fund shares sold .......................... 110 108 33 --
Receivable for tax reclaims .............................. 9 -- -- --
Receivable for expense reimbursement ..................... -- -- -- 6
Receivable for variation margin on open futures contracts 35 4 3 --
Prepaid expenses ......................................... 20 -- 19 --
------------ ------------ ----------- ---------
Total assets ....................................... 713,250 56,355 57,171 362
------------ ------------ ----------- ---------
LIABILITIES:
Payable for investments purchased ........................ 2,061 359 771 --
Payable upon return of securities loaned ................. 5,636 -- 1,378 --
Payable for fund shares redeemed ......................... 115 28 46 --
Management and investment advisory fees payable (Note 2) . 378 74 99 3
Administrative service and service fees payable .......... 82 2 7 --
Other liabilities ........................................ 84 22 19 13
------------ ------------ ----------- ---------
Total liabilities .................................. 8,356 485 2,320 16
------------ ------------ ----------- ---------
NET ASSETS ..................................................... $ 704,894 $ 55,870 $ 54,851 $ 346
============ ============ =========== =========
ANALYSIS OF NET ASSETS:
Paid-in-capital ................................................ 931,635 85,759 95,301 7,005
Undistributed net investment income ............................ 6,386 164 183 (19)
Accumulated net realized (loss) ................................ (121,812) (29,050) (20,088) (6,629)
Unrealized (depreciation) of investments, futures contracts, and
foreign currency ............................................... (111,315) (1,003) (20,545) (11)
------------ ------------ ----------- ---------
NET ASSETS ..................................................... $ 704,894 $ 55,870 $ 54,851 $ 346
============ ============ =========== =========
Shares outstanding (no par value):
Institutional Class ...................................... 3,968,980 18,441 311,359 17,460
============ ============ =========== =========
Investor Class ........................................... 10,332,515 N/A 2,691,973 45,480
============ ============ =========== =========
Advisor Class ............................................ 738,040 N/A 95 N/A
============ ============ =========== =========
AMR Class ................................................ 58,703,321 12,944,245 6,142,111 N/A
============ ============ =========== =========
Net asset value, offering and redemption price per share:
Institutional Class ...................................... $ 10.02 $ 4.29 $ 6.00 $ 5.20
============ ============ =========== =========
Investor Class ........................................... $ 9.30 N/A $ 5.98 $ 5.49
============ ============ =========== =========
Advisor Class ............................................ $ 9.64 N/A $ 5.94 N/A
============ ============ =========== =========
AMR Class ................................................ $ 9.57 $ 4.31 $ 6.01 N/A
============ ============ =========== =========
A Cost of investments in unaffiliated securities ............... $ 815,317 $ 56,908 $ 77,315 $ 363
B Cost of investments in affiliated securities ................. $ 6,210 $ -- $ 296 $ --
C Market value of securities on loan ........................... $ 5,501 $ -- $ 1,326 $ --
See accompanying notes
27
AMERICAN BEACON FUNDS
STATEMENTS OF OPERATIONS
Six Months Ended April 30, 2009 (in thousands) (Unaudited)
SMALL CAP
LARGE CAP VALUE
BALANCED GROWTH MID-CAP OPPORTUNITY
FUND FUND VALUE FUND FUND
--------- --------- ---------- -----------
INVESTMENT INCOME:
Dividend income from unaffiliated securities (net of foreign taxes)A $ 6,870 $ 480 $ 600 $ 18
Dividend income from affiliated securities ......................... 51 5 6 --
Interest income .................................................... 8,407 1 1 4
Income derived from securities lending, net ........................ 554 55 52 --
-------- -------- -------- --------
Total investment income ...................................... 15,882 541 659 22
-------- -------- -------- --------
EXPENSES:
Management and investment advisory fees (Note 2) ................... 727 112 154 5
Administrative service fees (Note 2):
Institutional Class ............................................. 55 -- 3 3
Investor Class .................................................. 142 -- 22 --
Advisor Class ................................................... 11 -- -- --
AMR Class ....................................................... 136 13 8 --
Transfer agent fees:
Institutional Class ............................................. 1 -- -- --
Investor Class .................................................. 6 -- -- --
AMR Class ....................................................... 16 1 -- --
Custody and fund accounting fees ................................... 47 3 3 --
Professional fees .................................................. 19 12 12 11
Registration fees and expenses ..................................... 22 -- 18 14
Service fees (Note 2):
Investor Class .................................................. 125 -- 18 --
Advisor Class ................................................... 9 -- -- --
Distribution fees- Advisor Class (Note 2) .......................... 9 -- -- --
Prospectus and shareholder reports ................................. 33 2 4 2
Trustee fees ....................................................... 28 1 1 --
Other expenses ..................................................... 27 4 5 1
-------- -------- -------- --------
TOTAL EXPENSES .................................................. 1,413 148 248 36
-------- -------- -------- --------
Net (fees waived and expenses reimbursed)/recouped by Manager
(Note 2) ...................................................... -- -- (11) (19)
-------- -------- -------- --------
NET EXPENSES .............................................. 1,413 148 237 17
-------- -------- -------- --------
NET INVESTMENT INCOME .................................................... 14,469 393 422 5
-------- -------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from:
Investments ..................................................... (29,847) (12,620) (6,046) (2,036)
Commission recapture (Note 1) ................................... 6 5 16 --
Futures contracts ............................................... (17,883) (1,401) (1,649) --
Change in net unrealized appreciation or depreciation of:
Investments ..................................................... 9,749 10,939 6,805 1,405
Futures contracts ............................................... 13,090 877 1,680 --
-------- -------- -------- --------
NET GAIN (LOSS) ON INVESTMENTS .................................. (24,885) (2,200) 806 (631)
-------- -------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS .......... $(10,416) $ (1,807) $ 1,228 $ (626)
========= ========= ======== =========
A Foreign taxes .......................................................... $ 25 $ -- $ 1 $ --
See accompanying notes
28
American Beacon Funds
Statement of Changes in Net Assets (in thousands)
Balanced Fund Large Cap Growth Fund
-------------------------- --------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
April 30, October 31, April 30, October
2009 2008 2009 31, 2008
----------- ----------- ----------- -----------
(unaudited) (unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income .............................. $ 14,469 $ 35,336 $ 393 $ 868
Net realized (loss) on investments, futures
contracts, and foreign currency transactions .. (47,724) (67,673) (14,016) (14,713)
Change in net unrealized appreciation or
depreciation of investments, futures contracts,
and foreign currency translations ............. 22,839 (277,483) 11,816 (24,338)
----------- ----------- ----------- -----------
Net (decrease) in net assets resulting from
operations .................................... (10,416) (309,820) (1,807) (38,183)
----------- ----------- ----------- -----------
Distributions to Shareholders:
Net investment income:
Institutional Class .............................. (1,697) (1,424) (1) (1)
Investor Class ................................... (4,916) (5,471) -- --
Advisor Class .................................... -- (318) -- --
AMR Class ........................................ (28,892) (27,782) (836) (791)
Net realized gain on investments:
Institutional Class .............................. -- (2,559) -- (3)
Investor Class ................................... -- (10,490) -- --
Advisor Class .................................... -- (602) -- --
AMR Class ........................................ -- (45,704) -- (2,748)
----------- ----------- ----------- -----------
Net distributions to shareholders ............. (35,505) (94,350) (837) (3,543)
----------- ----------- ----------- -----------
Capital Share Transactions:
Proceeds from sales of shares ...................... 35,574 83,795 8,034 34,857
Reinvestment of dividends and distributions ........ 35,347 93,808 837 3,543
Cost of shares redeemed ............................ (74,019) (181,757) (7,416) (41,432)
----------- ----------- ----------- -----------
Net increase (decrease) in net assets from
capital share transactions .................... (3,098) (4,154) 1,455 (3,032)
----------- ----------- ----------- -----------
Net (decrease) in net assets ............................. (49,019) (408,324) (1,189) (44,758)
----------- ----------- ----------- -----------
Net Assets:
Beginning of period ................................ 753,913 1,162,237 57,059 101,817
----------- ----------- ----------- -----------
End of Period * .................................... $ 704,894 $ 753,913 $ 55,870 $ 57,059
=========== =========== =========== ===========
*Includes undistributed net investment income (loss) of .. $ 6,386 $ 27,287 $ 164 $ 610
=========== =========== =========== ===========
See accompanying notes
29
American Beacon Funds
Statements of Changes in Net Assets (in thousands)
Small Cap Value
Mid-Cap Value Fund Opportunity Fund
-------------------------- --------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
April 30, October April 30, October
2009 31, 2008 2009 31, 2008
----------- ----------- ----------- -----------
(unaudited) (unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income .............................. $ 422 $ 1,382 $ 5 $ 104
Net realized (loss) on investments, futures
contracts, and foreign currency transactions .. (7,679) (12,043) (2,036) (4,266)
Change in net unrealized appreciation or
depreciation of investments, futures contracts,
and foreign currency translations ............. 8,485 (31,024) 1,405 312
----------- ----------- ----------- -----------
Net increase (decrease) in net assets resulting
from operations ............................... 1,228 (41,685) (626) (3,850)
----------- ----------- ----------- -----------
Distributions to Shareholders:
Net investment income:
Institutional Class .............................. (42) (84) (85) (134)
Investor Class ................................... (285) (326) (2) (1)
AMR Class ........................................ (838) (1,140) -- --
Net realized gain on investments:
Institutional Class .............................. -- (405) -- --
Investor Class ................................... -- (2,179) -- --
AMR Class......................................... -- (4,985) -- --
----------- ----------- ----------- -----------
Net distributions to shareholders ............. (1,165) (9,119) (87) (135)
----------- ----------- ----------- -----------
Capital Share Transactions:
Proceeds from sales of shares ...................... 9,733 30,505 344 1,610
Reinvestment of dividends and distributions ........ 1,163 9,098 87 135
Cost of shares redeemed ............................ (9,179) (63,782) (3,746) (23,073)
Redemption fees .................................... 11 43 -- --
----------- ----------- ----------- -----------
Net increase (decrease) in net assets from
capital share transactions .................... 1,728 (24,136) (3,315) (21,328)
----------- ----------- ----------- -----------
Net increase (decrease) in net assets .................... 1,791 (74,940) (4,028) (25,313)
----------- ----------- ----------- -----------
Net Assets:
Beginning of period ................................ 53,060 128,000 4,374 29,687
----------- ----------- ----------- -----------
End of Period * .................................... $ 54,851 $ 53,060 $ 346 $ 4,374
=========== =========== =========== ===========
*Includes undistributed net investment income (loss) of .. $ 183 $ 937 $ (19) $ 65
=========== =========== =========== ===========
See accompanying notes
30
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
American Beacon Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940 (the
"Act"), as amended, as a no load, diversified, open-end management investment
company. These financial statements and notes to the financial statements relate
to the American Beacon Balanced Fund, the American Beacon Large Cap Growth Fund,
the American Beacon Mid-Cap Value Fund, and the American Beacon Small Cap Value
Opportunity Fund (each a "Fund" and collectively, the "Funds"), each a series of
the Trust.
American Beacon Advisors, Inc. (the "Manager"), is a wholly-owned
subsidiary of Lighthouse Holdings, Inc., and was organized in 1986 to provide
business management, advisory, administrative and asset management consulting
services to the Trust and other investors.
The American Beacon Small Cap Value Opportunity Fund closed on
May 29, 2009.
Class Disclosure
Prior to March 1, 2009, the Investor and Advisor Classes were known as the
PlanAhead and Service Classes, respectively.
Each Fund has multiple classes of shares designed to meet the needs of
different groups of investors; however, not all Funds offer all classes. The
following table sets forth the differences amongst the classes:
CLASS: OFFERED TO:
- ------ -----------
INSTITUTIONAL CLASS Investors making an initial investment of $2 million
INVESTOR CLASS General public and investors investing through an intermediary
ADVISOR CLASS Investors investing through an intermediary
AMR CLASS Investors in the tax-exempt retirement and benefit plans of
AMR Corporation and its affiliates
Administrative service fees, service fees and distribution fees vary
amongst the classes as described more fully in footnote 2.
Investment income, net capital gains (losses) and all expenses incurred by
the Funds are allocated based on the relative net assets of each class, except
for service fees and certain other fees and expenses related solely to one class
of shares.
Security Valuation
Investments are valued at the close of the New York Stock Exchange (the
"Exchange"), normally 4 p.m. ET, each day that the Exchange is open for
business. Equity securities for which market quotations are available are valued
at the last sale price or official closing price (closing bid price or last
evaluated quote if no sale has occurred) on the primary market or exchange on
which they trade.
Debt securities (other than short-term securities) normally are valued on
the basis of prices provided by an independent pricing service and may take into
account appropriate factors such as institution-size trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data. Prices of debt securities may be
determined using quotes obtained from brokers.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation. Investment grade short-term
obligations with 60 days or less to maturity are valued using the amortized cost
method, which approximates market value.
31
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Securities for which market prices are not readily available or are not
reflective of the fair value of the security, as determined by the Manager, will
be priced at fair value following procedures approved by the Board of Trustees
(the "Board").
The Funds adopted the provisions of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective with the
beginning of the Fund's fiscal year. The standard clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires additional disclosures about the use of fair value
measurements. The three levels of the hierarchy under FAS 157 are described
below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Prices determined using other significant observable inputs.
These may include quoted prices for similar securities, interest rates,
prepayment speeds, credit risk, and others.
Level 3 - Prices determined using other significant unobservable inputs.
Unobservable inputs reflect the Fund's own assumptions about the factors
market participants would use in pricing an investment, and would be based
on the best information available.
A summary of the inputs used to value each Fund's investments as of April 30,
2009 is as follows (in thousands):
Balanced Fund
Investments Other Financial
Valuation Inputs in Securities Instruments*
---------------- ------------- ---------------
Level 1 - Quoted prices........................ $492,129 $3,328
Level 2 - Other significant observable inputs.. 214,754 --
Level 3 - Significant unobservable inputs..... -- --
-------- ------
Total.......................................... $706,883 $3,328
-------- ------
Large Cap Growth Fund
Investments Other Financial
Valuation Inputs in Securities Instruments*
---------------- ------------- ---------------
Level 1 - Quoted prices........................ $55,188 $103
Level 2 - Other significant observable inputs.. 614 --
Level 3 - Significant unobservable inputs..... -- --
------- ----
Total.......................................... $55,802 $103
------- ----
Mid-Cap Value Fund
Investments Other Financial
Valuation Inputs in Securities Instruments*
---------------- ------------- ---------------
Level 1 - Quoted prices........................ $56,175 $290
Level 2 - Other significant observable inputs.. 601 --
Level 3 - Significant unobservable inputs..... -- --
------- ----
Total.......................................... $56,776 $290
------- ----
Small Cap Value Opportunity Fund
Investments Other Financial
Valuation Inputs in Securities Instruments*
---------------- ------------- ---------------
Level 1 - Quoted prices........................ $353 $--
Level 2 - Other significant observable inputs.. -- --
Level 3 - Significant unobservable inputs...... -- --
---- ---
Total.......................................... $353 $--
---- ---
- ----------
* Other financial instruments are futures.
Security Transactions and Investment Income
Security transactions are recorded on the trade date of the security
purchase or sale. The Funds may purchase securities with delivery or payment to
occur at a later date. At the time the Funds enter into a
32
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
commitment to purchase a security, the transaction is recorded and the value of
the security is reflected in the net asset value. The value of the security may
vary with market fluctuations.
Dividend income, net of foreign taxes, is recorded on the ex-dividend date
except certain dividends from foreign securities which are recorded as soon as
the information is available to the Funds. Interest income is earned from
settlement date, recorded on the accrual basis, and adjusted, if necessary, for
accretion of discounts and amortization of premiums. For financial and tax
reporting purposes, realized gains and losses are determined on the basis of
specific lot identification.
Futures Contracts
Futures contracts are contracts to buy or sell a standard quantity of
securities at a specified price on a future date. The Funds may enter into
financial futures contracts as a method for keeping assets readily convertible
to cash if needed to meet shareholder redemptions or for other needs while
maintaining exposure to the stock or bond market, as applicable. The primary
risks associated with the use of futures contracts are the possibility of
illiquid markets or imperfect correlation between the values of the contracts
and the underlying securities, or that the counterparty will fail to perform its
obligations.
Upon entering into a futures contract, the Fund is required to set aside or
deposit with a broker an amount, termed the initial margin, which typically
represents 5% of the face value of the futures contract. The Funds reflect this
amount on the Schedules of Investments as a U.S. Treasury Bill held as
collateral for futures contracts or as a Deposit with broker for futures
contracts on the Statements of Assets and Liabilities. Payments to and from the
broker, known as variation margin, are required to be made on a daily basis as
the price of the futures contract fluctuates. Changes in initial settlement
values are accounted for as unrealized appreciation (depreciation) until the
contracts are terminated, at which time realized gains and losses are
recognized. Futures contracts are valued at the most recent settlement price
established each day by the exchange on which they are traded.
Dividends to Shareholders
Dividends from net investment income of the Funds normally will be declared
and paid at least annually. Distributions, if any, of net realized capital gains
are generally paid at least annually and recorded on the ex-dividend date.
Commission Recapture
The Funds have established brokerage commission recapture arrangements with
certain brokers or dealers. If a Fund's investment advisor chooses to execute a
transaction through a participating broker, the broker rebates a portion of the
commission back to the Fund. Any collateral benefit received through
participation in the commission recapture program is directed exclusively to the
Fund. These amounts are reported with the net realized gains in the Funds'
Statements of Operations.
Allocation of Income, Expenses, Gains and Losses
Income, expenses (other than those attributable to a specific class), gains
and losses are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses directly
attributable to a specific class are charged against the operations of that
class.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimated.
33
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Recently Issued Accounting Pronouncements
In March 2008, FASB issued Statement on Financial Accounting Standards No.
161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"), which is effective for fiscal years and interim periods beginning after
November 15, 2008. FAS 161 requires enhanced disclosures about derivative and
hedging activities, including how such activities are accounted for and their
effect on financial position, performance and cash flows. The Manager is
currently evaluating the impact the adoption of FAS 161 will have on the Funds'
financial statements and related disclosures.
Other
Under the Trust's organizational documents, its officers and directors are
indemnified against certain liability arising out of the performance of their
duties to the Trust. In the normal course of business, the Trust enters into
contracts that provide indemnification to the other party or parties against
potential costs or liabilities. The Trust's maximum exposure under these
arrangements is dependent on claims that may be made in the future and,
therefore, cannot be estimated. The Trust has had no prior claims or losses
pursuant to any such agreement.
2. TRANSACTIONS WITH AFFILIATES
Management Agreement
The Trust and the Manager are parties to a Management Agreement that
obligates the Manager to provide or oversee the provision of all administrative,
investment advisory, fund management and securities lending services. Investment
assets of the Funds are managed by one or more investment advisors which have
entered into separate investment advisory agreements with the Manager. As
compensation for performing the duties required under the Management Agreement,
the Manager receives from the Funds an annualized fee equal to 0.05% of the
average daily net assets plus amounts paid by the Manager to the investment
advisors hired by the Manager to direct investment activities of the Funds. The
Manager is one of the investment advisors of the Balanced Fund and receives an
annualized fee of 0.15% on the portion of assets managed by the Manager.
Management fees paid during the six months ended April 30, 2009 were as follows
(dollars in thousands):
AMOUNTS PAID TO NET AMOUNTS
MANAGEMENT FEE RATE MANAGEMENT FEE INVESTMENT ADVISORS RETAINED BY MANAGER
------------------- -------------- ------------------- -------------------
Balanced..................... 0.225%-0.70% $727 $556 $171
Large Cap Growth............. 0.35%-0.55% 112 99 13
Mid-Cap Value................ 0.35%-1.10% 154 142 12
Small Cap Value Opportunity.. 0.45%-0.55% 5 4 1
As compensation for services provided by the Manager in connection with
securities lending activities, the lending Fund pays to the Manager, with
respect to cash collateral posted by borrowers, a fee up to 25% of the net
monthly interest income (the gross interest income earned by the investment of
cash collateral, less the amount paid to borrowers and related expenses) from
such activities and, with respect to loan fees paid by borrowers when a borrower
posts collateral other than cash, a fee up to 25% of such loan fees. This fee is
netted against securities lending income in the Statements of Operations. During
the six months ended April 30, 2009, securities lending fees paid to the Manager
were as follows (in thousands):
Balanced..................... $69
Large Cap Growth............. 7
Mid-Cap Value................ 7
34
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Administrative Services Agreement
The Manager and the Trust entered into an Administrative Services Agreement
which obligates the Manager to provide or oversee administrative services to the
Funds. As compensation for performing the duties required under the
Administrative Services Agreement, the Manager receives an annualized fee of
0.30% of the average daily net assets of the Institutional, Investor, and
Advisor Classes and 0.05% of the average daily net assets of the AMR Class of
each of the Funds.
Distribution Plans
The Trust, except for the Advisor Class of the Funds, has adopted a
"defensive" Distribution Plan (the "Plan") in accordance with Rule 12b-1 under
the Act, pursuant to which no fees may be charged to the Funds for distribution
purposes. However, the Plan authorizes the management and administrative service
fees received by the Manager and the investment advisors hired by the Manager to
be used for distribution purposes. Under this Plan, the Trust does not intend to
compensate the Manager or any other party, either directly or indirectly, for
the distribution of Trust shares.
A separate Distribution Plan (the "Distribution Plan") has been adopted
pursuant to Rule 12b-1 under the Act for the Advisor Class of the Funds. Under
the Distribution Plan, as compensation for distribution assistance, the Manager
receives an annual fee of 0.25% of the average daily net assets of the Advisor
Class. The fee will be payable without regard to whether the amount of the fee
is more or less than the actual expenses incurred in a particular month by the
Manager for distribution assistance.
Service Plans
The Manager and the Trust entered into Service Plans that obligate the
Manager to oversee additional shareholder servicing of the Investor and Advisor
Classes. As compensation for performing the duties required under the Service
Plans, the Manager receives up to 0.375% of the average daily net assets of the
Investor Class and 0.25% of the average daily net assets of the Advisor Class of
each Fund.
Brokerage Commissions
Affiliated entities of an investment advisor to the Large Cap Growth Fund
received net commissions on purchases and sales of the Fund's portfolio
securities totaling $628 for the six months ended April 30, 2009.
Investment in Affiliated Funds
The Funds may invest in the American Beacon Money Market (the "MM Select
Fund) or US Government Money Market Select Fund (the USG Select Fund)
(collectively the "Select Funds"). Cash collateral received by certain Funds in
connection with securities lending may be invested in the Select Funds. The
Funds and the Select Funds have the same investment advisor and therefore, are
considered to be affiliated. The Manager serves as investment advisor to the
Select Funds and receives from each Select Fund an annualized fee of 0.09% of
its average daily net assets. During the six months ended April 30, 2009, fees
earned by the Manager as a result of the Funds' investment in the Select Funds
were as follows:
SECURITIES LENDING
DIRECT INVESTMENT IN COLLATERAL INVESTED IN
AFFILIATED FUNDS AFFILIATED FUNDS TOTAL
-------------------- ---------------------- ------
Balanced..................... $3,809 $5,989 $9,798
Large Cap Growth............. -- 628 628
Mid-Cap Value................ 470 585 1,055
Small Cap Value Opportunity.. 10 33 43
35
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Interfund Lending Program
Pursuant to an exemptive order by the Securities Exchange Commission
("SEC"), the Funds, along with other registered investment companies having
management contracts with the Manager, may participate in an interfund lending
program as a borrower. This program provides an alternative credit facility
allowing the Funds to borrow from other participating Funds. During the six
months ended April 30, 2009, the Fund did not utilize the credit facility.
Reimbursement of Expenses
The Manager agreed to reimburse the following Funds to the extent that
total annual fund operating expenses exceed the Fund's expense cap. For the
period ended April 30, 2009, the Manager waived or reimbursed expenses as
follows:
Expense Cap
-----------------------
11/1/08 3/1/09 WAIVED OR
TO TO REIMBURSED
FUND CLASS 2/28/09 4/30/09 EXPENSES
- ---- ------------- ------- ------- ----------
Large Cap Growth............. Institutional 0.90% -- $ 21
Mid-Cap Value................ Institutional 0.98% 0.98% 1,661
Mid-Cap Value................ Investor 1.23% 1.23% 9,568
Mid-Cap Value................ Advisor 1.50% 1.50% 3
Small Cap Value Opportunity.. Institutional 1.05% 1.05% 14,245
Small Cap Value Opportunity.. Investor 1.30% 1.30% 5,287
Expense Reimbursement Plan
The Funds have adopted an Expense Reimbursement Plan whereby the Manager
may seek repayment of fees waived or expenses reimbursed for a period of up to
three years. However, reimbursement will occur only if the Class' average net
assets have grown or expenses have declined sufficiently to allow reimbursement
without causing its expense ratio to exceed the previously agreed upon
contractual expense limit. During the six months ended April 30, 2009, the Funds
have not recorded a liability for potential reimbursement, due to the current
assessment that a reimbursement is unlikely.
3. FEDERAL INCOME AND EXCISE TAXES
It is the policy of each of the Funds to comply with the requirements of
Subchapter M of the Internal Revenue Code and to distribute substantially all
net investment income as well as any net realized capital gains on the sale of
investments. Therefore, no federal income or excise tax provision is required.
The Funds adopted the provisions of FASB Interpretation No. 48, "Accounting
for Uncertainties in Income Taxes" ("FIN 48"), on November 1, 2007. FIN 48 sets
forth a minimum threshold for financial statement recognition of the benefit of
a tax position taken or expected to be taken in a tax return. The implementation
of FIN 48 did not result in any unrecognized tax benefits in the accompanying
financial statements. Each of the tax years in the three year period ended
October 31, 2008 remains subject to examination by the Internal Revenue Service.
If applicable, the Funds recognize interest accrued related to unrecognized tax
benefits in interest expense and penalties in "Other expenses" on the Statements
of Operations.
Dividends are categorized in accordance with income tax regulations which
may treat certain transactions differently than U.S. generally accepted
accounting principles. Accordingly, the character of distributions and
composition of net assets for tax purposes may differ from those reflected in
the accompanying financial statements.
36
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
The tax character of distributions paid during the six months ended April
30, 2009 and fiscal year ended October 31, 2008 were as follows (in thousands):
BALANCED LARGE CAP GROWTH
------------------------ ------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, OCTOBER APRIL 30, OCTOBER
2009 31, 2008 2009 31, 2008
----------- ---------- ----------- ----------
(UNAUDITED) (UNAUDITED)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class ...... $ 1,697 $ 1,997 $ 1 $ 1
Investor Class ........... 4,916 7,821 -- --
Advisor Class ............ -- 453 -- --
AMR Class ................ 28,892 38,025 836 791
LONG-TERM CAPITAL GAIN
Institutional Class ...... -- 1,986 -- 3
Investor Class ........... -- 8,140 -- --
Advisor Class ............ -- 467 -- --
AMR Class ................ -- 35,461 -- 2,748
------- ------- ---- -------
TOTAL DISTRIBUTIONS PAID .... $35,505 $94,350 $837 $ 3,543
======= ======= ==== =======
MID-CAP VALUE SMALL CAP VALUE OPPORTUNITY
------------------------ ---------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, OCTOBER APRIL 30, OCTOBER
2009 31, 2008 2009 31, 2008
----------- ---------- ----------- ----------
(UNAUDITED) (UNAUDITED)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class ...... $ 42 $ 139 $85 $134
Investor Class ........... 285 618 2 1
Advisor Class ............ -- -- -- --
AMR Class ................ 838 1,809 -- --
LONG-TERM CAPITAL GAIN
Institutional Class ...... -- 350 -- --
Investor Class ........... -- 1,887 -- --
Advisor Class ............ -- -- -- --
AMR Class ................ -- 4,316 -- --
------ ------ --- ----
TOTAL DISTRIBUTIONS PAID .... $1,165 $9,119 $87 $135
====== ====== === ====
* For tax purposes, short-term capital gains are considered ordinary income
distributions.
As of April 30, 2009, the components of distributable earnings on a tax basis
were as follows (in thousands):
SMALL CAP VALUE
BALANCED LARGE CAP GROWTH MID-CAP VALUE OPPORTUNITY
--------- ---------------- ------------- ---------------
Cost basis of investments for federal income tax purpose .. $ 836,594 $ 57,803 $ 78,186 $ 363
Unrealized appreciation ................................... 32,514 4,053 1,830 --
Unrealized depreciation ................................... (162,225) (6,054) (23,240) (10)
--------- -------- -------- -------
Net unrealized appreciation (depreciation) ................ (129,711) (2,001) (21,410) (10)
Undistributed ordinary income ............................. 6,981 166 183 --
Undistributed long-term gain (loss) ....................... (104,024) (28,052) (19,223) (6,629)
--------- -------- -------- -------
Distributable earnings (losses) ........................... $(226,754) $(29,887) $(40,450) $(6,639)
========= ======== ======== =======
Financial reporting records are adjusted for permanent book/tax differences
to reflect tax character. Financial records are not adjusted for temporary
differences. The temporary differences between financial reporting and tax-basis
reporting of unrealized appreciation/(depreciation) are attributable primarily
to the tax deferral of losses from wash sales, the realization for tax purposes
of unrealized gains/(losses) on certain
37
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
derivative instruments, book amortization for premiums, and reclassifications of
income from real estate investment securities.
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under U.S. generally accepted accounting principles and
federal income tax regulations, permanent differences between book and tax
reporting have been identified and appropriately reclassified on the Statements
of Assets and Liabilities.
Accordingly, the following amounts represent current year permanent
differences derived from reclassifications of income from real estate investment
securities, foreign currency, book amortization of premium, pay down reclasses,
income adjustments associated with contingent payment debt instruments, and
dividend reclasses that have been reclassified as of April 30, 2009 (in
thousands):
SMALL CAP
LARGE CAP MID-CAP VALUE
BALANCED GROWTH VALUE OPPORTUNITY
-------- --------- ------- -----------
Paid-in-capital ....................... $ 165 $ 2 $ (9) $(1)
Undistributed net investment income ... 135 (2) (11) (2)
Accumulated net realized gain (loss) .. (302) -- 20 3
Unrealized appreciation (depreciation)
of investments, futures
contracts and foreign currency ..... -- -- -- --
At April 30, 2009 capital loss carry forward positions for federal income
tax purposes were as follows (in thousands):
FUND 2015 2016 2017 TOTAL
- ---- ---- ------- ------- --------
Balanced ..................... $ -- $68,541 $35,483 $104,024
Large Cap Growth ............. -- 15,053 12,999 28,052
Mid-Cap Value ................ -- 13,378 5,845 19,223
Small Cap Value Opportunity .. 313 4,273 2,043 6,629
4. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales and maturities of
long-term investments during the six months ended April 30, 2009 were as follows
(in thousands):
LARGE
CAP MID-CAP SMALL CAP VALUE
BALANCED GROWTH VALUE OPPORTUNITY
-------- ------- ------- ---------------
Purchases (excluding U.S. government securities) $181,758 $64,450 $21,184 $1,897
Sales and maturities (excluding U.S. government securities) 154,777 56,440 9,055 5,177
Purchases of U.S. government securities 54,369 -- -- --
Sales and maturities of U.S. government securities 59,124 -- -- --
A summary of the Funds' direct transactions in the Select Funds for the six
months ended April 30, 2009 is set forth below (in thousands):
OCTOBER 31, 2008 APRIL 30, 2009
AFFILIATE SHARES/MARKET VALUE PURCHASES SALES SHARES/MARKET VALUE
--------------- ------------------- --------- ------- -------------------
Balanced ..................... MM Select Fund $34,006 $ -- $34,006 $ --
Balanced ..................... USG Select Fund -- 5,000 -- 5,000
Large Cap Growth ............. MM Select Fund 3,451 -- 3,451 --
Mid-Cap Value ................ MM Select Fund 4,196 -- 4,196 --
Small Cap Value Opportunity .. MM Select Fund 90 -- 90 --
38
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
5. SECURITIES LENDING
Each Fund may lend its securities to qualified financial institutions, such
as certain broker-dealers, to earn additional income. The borrowers are required
to secure their loans continuously with collateral in an amount at least equal
to the fair value of the securities loaned, initially in an amount at least
equal to 102% of the fair value of domestic securities loaned and 105% of the
fair value of international securities loaned. Collateral is monitored and
marked to market daily. Daily mark to market amounts are required to be paid to
the borrower or received from the borrower by the end of the following business
day. This one day settlement for mark to market amounts may result in the
collateral being temporarily less than the value of the securities on loan or
temporarily more than the required minimum collateral. The amount of the
temporary difference at April 30, 2009, is disclosed as the calculated mark in
the table below.
To the extent that a loan is collateralized by cash, such cash collateral
shall be invested by the securities lending agent (the "Agent") in money market
mutual funds, and other short-term investments, provided the investments meet
certain quality and diversification requirements.
Securities lending income is generated from the demand premium (if any) by
the borrower to borrow a specific security and from the return on investment of
cash collateral, reduced by negotiated rebate fees paid to the borrower and
transaction costs. To the extent that a loan is secured by non-cash collateral,
securities lending income is generated as a demand premium reduced by
transaction costs. The Funds, the Agent and the Manager retain 75%, 15%, and
10%, respectively, of the income generated from securities lending.
While securities are on loan the Funds continue to receive any income
associated with that security and any gain or loss in the market price that may
occur during the term of the loan.
Securities lending transactions pose certain risks to the Funds, including
that the borrower may not provide additional collateral when required or return
the securities when due, that the value of the short-term investments will be
less than the amount of cash collateral required to be returned to the borrower,
that non-cash collateral may be subject to legal constraints in the event of a
borrower bankruptcy, and that the cash collateral investments could become
illiquid and unable to be used to return collateral to the borrower. The Funds
could also experience delays and costs in gaining access to the collateral. The
Funds bear the risk of any deficiency in the amount of the cash collateral
available for return to the borrower and any action which impairs its ability to
liquidate non-cash collateral to satisfy a borrower default.
As of April 30, 2009, the value of outstanding securities on loan and the
value of collateral was as follows (in thousands):
CASH COLLATERAL
MARKET VALUE OF NON-CASH POSTED BY CALCULATED TOTAL VALUE OF
FUND SECURITIES ON LOAN COLLATERAL BORROWER MARK COLLATERAL
- ---- ------------------ ---------- --------------- ---------- --------------
Balanced ....... $5,501 $-- $5,636 4 $5,640
Mid-Cap Value .. 1,326 -- 1,378 (7) 1,371
Cash collateral is listed on each Fund's Schedule of Investments and is
shown on the Statement of Assets and Liabilities. Income earned on these
investments is included in Income derived from securities lending in the
Statements of Operations.
Non-cash collateral received by the Funds may not be sold or repledged
except to satisfy a borrower default. Therefore, non-cash collateral is not
included on the Funds' Schedules of Investments or Statements of Assets and
Liabilities.
39
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
6. CAPITAL SHARE TRANSACTIONS
The tables below summarize the activity in capital shares for each Class of
the Funds (shares and dollars in thousands):
SIX MONTHS ENDED APRIL 30, 2009
INSTITUTIONAL INVESTOR ADVISOR
CLASS CLASS CLASS AMR CLASS
---------------- ----------------- --------------- -----------------
BALANCED FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------- ------ ------- ------ -------- ------ ------ ------ --------
Shares sold ..................... 929 $ 9,119 990 $ 8,999 46 $ 428 1,796 $ 17,028
Reinvestment of dividends ....... 170 1,684 517 4,771 -- -- 3,048 28,892
Shares redeemed ................. (570) (5,441) (1,823) (16,378) (93) (880) (5,428) (51,320)
---- ------- ------ -------- --- ----- ------ --------
Net increase (decrease) in shares
outstanding .................. 529 $ 5,362 (316) $ (2,608) (47) $(452) (584) $ (5,400)
==== ======= ====== ======== === ===== ====== ========
INSTITUTIONAL
CLASS AMR CLASS
--------------- ----------------
LARGE CAP GROWTH FUND SHARES AMOUNT SHARES AMOUNT
- --------------------- ------ ------ ------ -------
Shares sold ......................... -- $ 1 1,975 $ 8,033
Reinvestment of dividends ........... -- 1 205 836
Shares redeemed ..................... -- (2) (1,847) (7,414)
--- --- ------ -------
Net increase in shares outstanding .. -- $-- 333 $ 1,455
=== === ====== =======
INSTITUTIONAL
CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
--------------- ---------------- --------------- ----------------
MID-CAP VALUE FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------------ ------ ------ ------ ------- ------ ------ ------ -------
Shares sold ..................... 11 $ 61 525 $ 2,873 -- $-- 1,247 $ 6,799
Reinvestment of dividends ....... 7 41 52 284 -- -- 153 838
Shares redeemed ................. (87) (451)* (685) (3,585)* -- --* (999) (5,132)*
---- ----- ---- -------- --- --- ----- -------
Net increase (decrease) in shares
outstanding .................. (69) $(349) (108) $ (428) -- $-- 401 $ 2,505
==== ===== ==== ======== === === ===== =======
* Net of Redemption Fees
INSTITUTIONAL
CLASS INVESTOR CLASS
---------------- ---------------
SMALL CAP VALUE OPPORTUNITY FUND SHARES AMOUNT SHARES AMOUNT
- -------------------------------- ------ ------- ------ ------
Shares sold ..................... 30 $ 170 31 $174
Reinvestment of dividends ....... 13 85 -- 2
Shares redeemed ................. (664) (3,739) (1) (7)
---- ------- --- ----
Net increase (decrease) in shares
outstanding .................. (621) $(3,484) 30 $169
==== ======= === ====
PERIOD ENDED OCTOBER 31, 2008
INSTITUTIONAL
CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
----------------- ----------------- ---------------- -----------------
BALANCED FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------- ------ -------- ------ -------- ------ ------- ------ --------
Shares sold ..................... 1,198 $ 16,083 2,230 $ 28,546 297 $ 3,951 2,713 $ 35,215
Reinvestment of dividends ....... 272 3,895 1,160 15,508 70 920 5,368 73,485
Shares redeemed ................. (1,225) (16,311) (6,179) (76,210) (218) (2,729) (6,818) (86,507)
------ -------- ------ -------- ---- ------- ------ --------
Net increase (decrease) in shares
outstanding .................. 245 $ 3,667 (2,789) $(32,156) 149 $ 2,142 1,263 $ 22,193
====== ======== ====== ======== ==== ======= ====== ========
40
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
INSTITUTIONAL
CLASS AMR CLASS
--------------- -----------------
LARGE CAP GROWTH FUND SHARES AMOUNT SHARES AMOUNT
- --------------------- ------ ------ ------ --------
Shares sold .................................... 4 $22 5,386 $ 34,835
Reinvestment of dividends ...................... -- 4 492 3,539
Shares redeemed ................................ (1) (8) (6,432) (41,424)
--- --- ------ ========
Net increase (decrease) in shares outstanding .. 3 $18 (554) $ (3,050)
=== === ====== ========
INSTITUTIONAL
CLASS INVESTOR CLASS ADVISOR CLASS AMR CLASS
---------------- ----------------- --------------- -----------------
MID-CAP VALUE FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- ------------------ ------ ------- ------ -------- ------ ------ ------ --------
Shares sold ........................... 322 $ 2,868 1,423 $ 12,385 -- $-- 1,756 $ 15,252
Reinvestment of dividends ............. 50 469 263 2,504 -- -- 641 6,125
Shares redeemed ....................... (541) (4,589)* (2,825) (25,705)* -- --* (3,772) (33,445)*
---- ------- ------ -------- --- --- ------ --------
Net (decrease) in shares outstanding .. (169) $(1,252) (1,139) $(10,816) -- $-- (1,375) $(12,068)
==== ======= ====== ======== === === ====== ========
* Net of Redemption Fees
INSTITUTIONAL
CLASS INVESTOR CLASS
----------------- ---------------
SMALL CAP VALUE OPPORTUNITY FUND SHARES AMOUNT SHARES AMOUNT
- -------------------------------- ------ -------- ------ ------
Shares sold .................................... 164 $ 1,406 24 $ 204
Reinvestment of dividends ...................... 14 134 -- 1
Shares redeemed ................................ (2,405) (22,928) (17) (145)
------ -------- --- -----
Net increase (decrease) in shares outstanding .. (2,227) $(21,388) 7 $ 60
====== ======== === =====
41
AMERICAN BEACON BALANCED FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
-------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------
2009 2008 2007 2006 2005 2004
----------- ------- ------- ------- ------- ------
(unaudited)
Net asset value, beginning of period ............. $ 10.63 $ 16.09 $ 15.83 $ 15.00 $ 14.31 $12.99
------- ------- ------- ------- ------- ------
Income from investment operations:
Net investment income(A) ...................... 0.20 0.47 0.50 0.39 0.36 0.29
Net gains (losses) on securities (both
realized and unrealized) ................... (0.33) (4.70) 0.90 1.54 1.11 1.36
------- ------- ------- ------- ------- ------
Total income (loss) from investment operations ... (0.13) (4.23) 1.40 1.93 1.47 1.65
------- ------- ------- ------- ------- ------
Less distributions:
Dividends from net investment income .......... (0.48) (0.44) (0.42) (0.38) (0.31) (0.33)
Distributions from net realized gains on
securities ................................. -- (0.79) (0.72) (0.72) (0.47) --
------- ------- ------- ------- ------- ------
Total distributions .............................. (0.48) (1.23) (1.14) (1.10) (0.78) (0.33)
------- ------- ------- ------- ------- ------
Net asset value, end of period ................... $ 10.02 $ 10.63 $ 16.09 $ 15.83 $ 15.00 $14.31
======= ======= ======= ======= ======= ======
Total return ..................................... (1.21)%(B) (28.23)% 9.31% 13.60% 12.78% 10.53%
======= ======= ======= ======= ======= ======
Ratios and supplemental data:
Net assets, end of period (in thousands) ..... $39,781 $36,557 $51,399 $22,587 $14,122 $8,378
Ratios to average net assets (annualized):
Expenses, net of waivers ...................... 0.57% 0.56% 0.57% 0.59% 0.56% 0.63%
Expenses, before waivers ...................... 0.57% 0.56% 0.57% 0.59% 0.56% 0.63%
Net investment income, net of waivers ......... 4.05% 3.37% 2.91% 2.81% 2.45% 2.15%
Net investment income (loss), before waivers .. 4.05% 3.37% 2.91% 2.81% 2.45% 2.15%
Portfolio turnover rate ....................... 33%(B) 53% 50% 59% 58% 62%
Investor Class
---------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -------------------------------
2009 2008 2007 2006
----------- -------- -------- --------
(unaudited)
Net asset value, beginning of period ............. $ 9.91 $ 15.09 $ 14.91 $ 14.20
------- -------- -------- --------
Income from investment operations:
Net investment income(A) ...................... 0.18 0.41 0.41 0.35
Net gains (losses) on securities (both
realized and unrealized) ................... (0.31) (4.39) 0.87 1.44
------- -------- -------- --------
Total income (loss) from investment operations ... (0.13) (3.98) 1.28 1.79
------- -------- -------- --------
Less distributions:
Dividends from net investment income .......... (0.48) (0.41) (0.38) (0.36)
Distributions from net realized gains on
securities ................................. -- (0.79) (0.72) (0.72)
------- -------- -------- --------
Total distributions .............................. (0.48) (1.20) (1.10) (1.08)
------- -------- -------- --------
Net asset value, end of period ................... $ 9.30 $ 9.91 $ 15.09 $ 14.91
======= ======== ======== ========
Total return ..................................... (1.32)%(B) (28.39)% 9.06% 13.31%
======= ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) ..... $96,083 $105,473 $202,750 $111,837
Ratios to average net assets (annualized):
Expenses, net of waivers ...................... 0.84% 0.82% 0.83% 0.85%
Expenses, before waivers ...................... 0.84% 0.82% 0.83% 0.85%
Net investment income, net of waivers ......... 3.80% 3.12% 2.65% 2.55%
Net investment income (loss), before waivers .. 3.80% 3.12% 2.65% 2.55%
Portfolio turnover rate ....................... 33%(B) 53% 50% 59%
(A) Through October 31, 2005, net investment income was calculated by
subtracting class expenses per share from the Fund's net investment income
per share before class expenses.
(B) Not annualized.
(C) Annualized.
(D) Portfolio turnover rate is for the period from November 1, 2004 through
October 31, 2005.
42
Advisor Class
- ----------------- ------------------------------------------------------
Six
Months
Ended Year Ended October 31, May 31 to
April 30, -------------------------- October 31,
2005 2004 2009 2008 2007 2006 2005
- ------- ------- ----------- ------- ------ ------ -----------
(unaudited)
$ 13.62 $ 12.40 $ 9.77 $ 14.95 $14.83 $14.16 $ 13.96
- ------- ------- ------ ------- ------ ------ --------
0.34 0.27 0.05 0.34 0.41 0.38 0.09
1.01 1.25 (0.18) (4.31) 0.83 1.35 0.11
- ------- ------- ------ ------- ------ ------ --------
1.35 1.52 (0.13) (3.97) 1.24 1.73 0.20
- ------- ------- ------ ------- ------ ------ --------
(0.30) (0.30) -- (0.42) (0.40) (0.34) --
(0.47) -- -- (0.79) (0.72) (0.72) --
- ------- ------- ------ ------- ------ ------ --------
(0.77) (0.30) -- (1.21) (1.12) (1.06) --
- ------- ------- ------ ------- ------ ------ --------
$ 14.20 $ 13.62 $ 9.64 $ 9.77 $14.95 $14.83 $ 14.16
======= ======= ====== ======= ====== ====== ========
10.12% 12.44% (1.43)%(B) (28.58)% 8.76% 13.01% 1.43%(B)
======= ======= ====== ======= ====== ====== ========
$86,875 $21,571 $7,115 $ 7,674 $9,504 $1,562 $ 1
0.86% 0.93% 1.07% 1.07% 1.07% 1.22% 1.09%(C)
0.86% 0.93% 1.07% 1.07% 1.07% 1.22% 360.24%(C)
2.14% 1.84% 3.56% 2.86% 2.34% 2.18% 1.52%(C)
2.14% 1.84% 3.56% 2.86% 2.34% 2.17% (357.63)%(C)
58% 62% 33%(B) 53% 50% 59% 58%(D)
AMR Class
- --------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------------
2009 2008 2007 2006 2005 2004
- ----------- -------- -------- -------- -------- --------
(unaudited)
$ 10.19 $ 15.49 $ 15.27 $ 14.49 $ 13.87 $ 12.60
- -------- -------- -------- -------- -------- --------
0.22 0.49 0.50 0.45 0.39 0.32
(0.33) (4.52) 0.89 1.46 1.05 1.31
- -------- -------- -------- -------- -------- --------
(0.11) (4.03) 1.39 1.91 1.44 1.63
- -------- -------- -------- -------- -------- --------
(0.51) (0.48) (0.45) (0.41) (0.35) (0.36)
-- (0.79) (0.72) (0.72) (0.47) --
- -------- -------- -------- -------- -------- --------
(0.51) (1.27) (1.17) (1.13) (0.82) (0.36)
- -------- -------- -------- -------- -------- --------
$ 9.57 $ 10.19 $ 15.49 $ 15.27 $ 14.49 $ 13.87
======== ======== ======== ======== ======== ========
(1.04)%(B) (28.08)% 9.59% 13.98% 10.63% 13.13%
======== ======== ======== ======== ======== ========
$561,915 $604,209 $898,584 $817,333 $712,073 $636,420
0.32% 0.31% 0.31% 0.33% 0.33% 0.37%
0.32% 0.31% 0.31% 0.33% 0.33% 0.37%
4.33% 3.62% 3.21% 3.08% 2.70% 2.40%
4.33% 3.62% 3.21% 3.08% 2.70% 2.40%
33%(B) 53% 50% 59% 58% 62%
43
AMERICAN BEACON LARGE CAP GROWTH FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
-------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -----------------------------------------------
2009(C) 2008 2007 2006(A) 2005 2004
----------- ------- ------ ------- ------ -------
(unaudited)
Net asset value, beginning of period ............. $ 4.49 $ 7.67 $ 6.89 $ 6.18 $ 5.82 $ 5.47
------- ------- ------ ------ ------ -------
Income from investment operations:
Net investment income ......................... 0.03 0.05 0.04 0.04 0.04 0.02
Net gains (losses) on securities (both
realized and unrealized) ................... (0.18) (2.97) 0.77 0.70 0.37 0.35
------- ------- ------ ------ ------ -------
Total income (loss) from investment operations ... (0.15) (2.92) 0.81 0.74 0.41 0.37
------- ------- ------ ------ ------ -------
Less distributions:
Dividends from net investment income .......... (0.05) (0.04) (0.03) (0.03) (0.05) (0.02)
Distributions from net realized gains on
securities ................................. -- (0.22) -- -- -- --
------- ------- ------ ------ ------ -------
Total distributions .............................. (0.05) (0.26) (0.03) (0.03) (0.05) (0.02)
------- ------- ------ ------ ------ -------
Net asset value, end of period ................... $ 4.29 $ 4.49 $ 7.67 $ 6.89 $ 6.18 $ 5.82
======= ======= ====== ====== ====== =======
Total return ..................................... (3.03)%(B) (39.48)% 11.84% 12.04% 7.06% 6.71%
======= ======= ====== ====== ====== =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $ 79 $ 83 $ 119 $ 110 $ 105 $ 1
Ratios to average net assets (annualized):
Expenses, net of waivers ...................... 0.88% 0.89% 0.90% 0.90% 0.89% 0.84%
Expenses, before waivers ...................... 0.94% 0.95% 1.06% 0.99% 4.64% 13.22%
Net investment income (loss), net of waivers .. 1.22% 0.74% 0.58% 0.56% (0.18)% 0.18%
Net investment income (loss), before waivers .. 1.17% 0.68% 0.42% 0.48% (3.93)% (12.20)%
Portfolio turnover rate ....................... 119%(B) 112% 128% 181% 164% 131%
(A) On September 12, 2006, The Renaissance Group, LLC assumed management of the
Large Cap Growth Fund's assets previously managed by J.P. Morgan Investment
Management, Inc.
(B) Not annualized.
(C) On March 17, 2009, Winslow Capital Management, Inc. assumed management of
the Large Cap Growth Fund's assets previously managed by Goldman Sachs
Asset Management, L.P.
44
AMR Class
- ---------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, -------------------------------------------------
2009(C) 2008 2007 2006(A) 2005 2004
- ----------- ------- -------- ------- ------- -------
(unaudited)
$ 4.52 $ 7.72 $ 6.95 $ 6.21 $ 5.84 $ 5.48
- ------- ------- -------- ------- ------- -------
0.03 0.07 0.06 0.05 0.06 0.02
(0.17) (2.99) 0.77 0.73 0.36 0.36
- ------- ------- -------- ------- ------- -------
(0.14) (2.92) 0.83 0.78 0.42 0.38
- ------- ------- -------- ------- ------- -------
(0.07) (0.06) (0.06) (0.04) (0.05) (0.02)
-- (0.22) -- -- -- --
- ------- ------- -------- ------- ------- -------
(0.07) (0.28) (0.06) (0.04) (0.05) (0.02)
- ------- ------- -------- ------- ------- -------
$ 4.31 $ 4.52 $ 7.72 $ 6.95 $ 6.21 $ 5.84
======= ======= ======== ======= ======= =======
(3.06)%(B) (39.17)% 12.07% 12.52% 7.22% 6.88%
======= ======= ======== ======= ======= =======
$55,791 $56,976 $101,698 $82,042 $63,183 $55,121
0.57% 0.59% 0.60% 0.59% 0.64% 0.71%
0.57% 0.59% 0.60% 0.59% 0.64% 0.71%
1.53% 1.05% 0.85% 0.88% 0.98% 0.34%
1.53% 1.05% 0.85% 0.88% 0.98% 0.34%
119%(B) 112% 128% 181% 164% 131%
45
AMERICAN BEACON MID-CAP VALUE FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class Investor Class
--------------------------------------- ----------------------------------------
Six November Six
Months Year Ended 30, 2005 Months Year Ended February
Ended October 31, to Ended October 31, 28 to
April 30, ---------------- October April 30, ----------------- October
2009 2008 2007 31, 2006 2009 2008 2007 31, 2006
----------- ------- ------ -------- ----------- ------- ------- --------
(unaudited) (unaudited)
Net asset value, beginning of period ........ $ 5.94 $ 11.01 $10.81 $12.09 $ 5.91 $ 10.96 $ 10.80 $ 9.80
------ ------- ------ ------ ------- ------- ------- -------
Income from investment operations:
Net investment income .................... 0.06 0.16 0.12 0.21 0.05 0.14 0.10 0.01
Net gains (losses) on securities (both
realized and unrealized) .............. 0.12 (4.31) 0.41 1.25 0.13 (4.31) 0.40 0.99
------ ------- ------ ------ ------- ------- ------- -------
Total income (loss) from investment
operations ............................... 0.18 (4.15) 0.53 1.46 0.18 (4.17) 0.50 1.00
------ ------- ------ ------ ------- ------- ------- -------
Less distributions:
Dividends from net investment income ..... (0.12) (0.16) (0.07) (0.16) (0.11) (0.11) (0.08) --
Distributions from net realized gains
on securities ......................... -- (0.76) (0.26) (2.58) -- (0.76) (0.26) --
------ ------- ------ ------ ------- ------- ------- -------
Total distributions ......................... (0.12) (0.92) (0.33) (2.74) (0.11) (0.87) (0.34) --
------ ------- ------ ------ ------- ------- ------- -------
Redemption fees added to beneficial
interests ................................ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net asset value, end of period .............. $ 6.00 $ 5.94 $11.01 $10.81 $ 5.98 $ 5.92 $ 10.96 $ 10.80
====== ======= ====== ====== ======= ======= ======= =======
Total return ................................ 3.40%(C) (40.96)% 4.87% 15.30%(C) 3.22%(C) (41.14)% 4.68% 10.20%(C)
====== ======= ====== ====== ======= ======= ======= =======
Ratios and supplemental data:
Net assets, end of period (in
thousands) ............................ $1,869 $ 2,256 $6,047 $3,396 $16,094 $16,550 $43,158 $27,240
Ratios to average net assets (annualized):
Expenses, net of waivers ................. 0.98% 0.98% 0.92% 1.19%(D) 1.23% 1.23% 1.23% 1.49%(D)
Expenses, before waivers ................. 1.16% 1.16% 1.09% 1.19%(D) 1.36% 1.32% 1.26% 1.61%(D)
Net investment income, net of waivers .... 1.75% 1.51% 1.22% 1.11%(D) 1.48% 1.27% 0.93% 0.57%(D)
Net investment income, before waivers .... 1.57% 1.33% 1.05% 1.11%(D) 1.35% 1.18% 0.90% 0.44%(D)
Portfolio turnover rate .................. 21%(C) 28% 35% 42%(E) 21%(C) 28% 35% 42%(E)
(A) On November 30, 2005, the Mid-Cap Value Fund's Institutional Class of
shares was renamed the AMR Class and the Fund began offering a new class of
shares known as the Institutional Class.
(B) Based on average shares outstanding.
(C) Not annualized.
(D) Annualized.
(E) Portfolio turnover rate is for the period from November 1, 2005 through
October 31, 2006.
(F) Portfolio turnover rate is for the period from November 1, 2006 through
October 31, 2007.
46
AMR Class (formerly Institutional Class
Advisor Class prior to December 1, 2005)(A)
- -------------------------------- ---------------------------------------------------------------
Six Six
Months Year June Months June
Ended Ended 29 to Ended Year Ended October 31, 30 to
April 30, October October April 30, -------------------------------------- October
2009 31, 2008 31, 2007 2009 2008 2007 2006 2005 31, 2004
- ----------- -------- -------- ----------- ------- ------- -------- ------- --------
(unaudited) (unaudited)
$ 5.87 $ 10.94 $11.73 $ 5.97 $ 11.07 $ 10.87 $ 11.72 $ 10.27 $ 10.00
- ------ ------- ------ ------- ------- ------- ------- ------- -------
0.06 0.10 0.01 0.05 0.18 0.18 0.12 0.13 0.02(B)
0.14 (4.27) (0.80) 0.14 (4.35) 0.36 1.75 1.37 0.25
- ------ ------- ------ ------- ------- ------- ------- ------- -------
0.20 (4.17) (0.79) 0.19 (4.17) 0.54 1.87 1.50 0.27
- ------ ------- ------ ------- ------- ------- ------- ------- -------
(0.13) (0.14) -- (0.15) (0.17) (0.08) (0.14) (0.05) --
-- (0.76) -- -- (0.76) (0.26) (2.58) -- --
- ------ ------- ------ ------- ------- ------- ------- ------- -------
(0.13) (0.90) -- (0.15) (0.93) (0.34) (2.72) (0.05) --
- ------ ------- ------ ------- ------- ------- ------- ------- -------
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
$ 5.94 $ 5.87 $10.94 $ 6.01 $ 5.97 $ 11.07 $ 10.87 $ 11.72 $ 10.27
====== ======= ====== ======= ======= ======= ======= ======= =======
3.61%(C) (41.24)% (6.65)%(C) 3.38%(C) (40.87)% 5.19% 19.16% 14.63% 2.70%(C)
====== ======= ====== ======= ======= ======= ======= ======= =======
$ 1 $ 1 $ 1 $36,887 $34,253 $78,794 $66,290 $44,342 $25,546
0.53% 1.50% 1.50%(D) 0.86% 0.82% 0.75% 0.97% 1.01% 1.14%(D)
1.55% 2.04% 1.80%(D) 0.86% 0.82% 0.75% 0.92% 1.02% 1.34%(D)
2.24% 1.02% 0.32%(D) 1.85% 1.68% 1.41% 1.38% 0.92% 0.73%(D)
1.22% 0.48% 0.02%(D) 1.85% 1.68% 1.40% 1.42% 0.91% 0.53%(D)
21%(C) 28% 35%(F) 21%(C) 28% 35% 42% 298% 6%(C)
47
AMERICAN BEACON SMALL CAP VALUE OPPORTUNITY FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
------------------------------------------
Year Ended October 31,
Six Months Ended ----------------------
April 30, 2009 2008 2007
---------------- ------- -------
(unaudited)
Net asset value, beginning of period ................................ $ 6.69 $ 10.33 $ 10.26
------- ------- -------
Income from investment operations:
Net investment income (loss) ..................................... (0.14)(A) 0.09(A) 0.11(A)
Net gains (losses) on securities (both realized and unrealized) .. (1.22)(A) (3.61)(A) - (A)
------- ------- -------
Total income (loss) from investment operations ...................... (1.36) (3.52) 0.11
------- ------- -------
Less distributions:
Dividends from net investment income ............................. (0.13) (0.12) (0.03)
Distributions from net realized gains on securities .............. -- -- (0.01)
------- ------- -------
Total distributions ................................................. (0.13) (0.12) (0.04)
------- ------- -------
Net asset value, end of period ...................................... $ 5.20 $ 6.69 $ 10.33
======= ======= =======
Total return ........................................................ (15.99)%(B) (34.49)% 1.08%
======= ======= =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ......................... $ 91 $ 4,268 $29,596
Ratios to average net assets (annualized):
Expenses, net of waivers ......................................... 1.90% 1.05% 1.05%
Expenses, before waivers ......................................... 3.63% 1.56% 1.27%
Net investment income, net of waivers ............................ 0.50% 1.22% 0.96%
Net investment income (loss), before waivers ..................... (1.24)% 0.71% 0.73%
Portfolio turnover rate .......................................... 101%(B) 75% 58%
(A) Based upon average shares outstanding.
(B) Not annualized.
48
Investor Class
-----------------------------------------------------------
Year Ended October 31,
March 31 to Six Months Ended ---------------------- March 31 to
October 31, 2006 April 30, 2009 2008 2007 October 31, 2006
- ---------------- ---------------- ------- ------ ----------------
(unaudited)
$10.00 $ 6.65 $ 10.28 $10.26 $ 10.00
------ ------- ------- ------ -------
0.01 0.15 0.10 0.14(A) 0.01
0.25 (1.20) (3.63) (0.05)(A) 0.25
------ ------- ------- ------ -------
0.26 (1.05) (3.53) 0.09 0.26
------ ------- ------- ------ -------
-- (0.11) (0.10) (0.06) --
-- -- -- (0.01) --
------ ------- ------- ------ -------
-- (0.11) (0.10) (0.07) --
------ ------- ------- ------ -------
$10.26 $ 5.49 $ 6.65 $10.28 $ 10.26
====== ======= ======= ====== =======
2.60%(B) (16.07)%(B) (34.60)% 0.96% 2.60%(B)
====== ======= ======= ====== =======
$4,693 $ 250 $ 106 $ 91 $ 70
1.03% 1.31% 1.26% 1.30% 1.28%
6.12% 7.16% 1.82% 1.70% 20.05%
0.30% 0.94% 0.93% 0.97% 0.21%
(4.80)% (4.91)% 0.37% 0.57% (18.56)%
32%(B) 101%(B) 75% 58% 32%(B)
49
RESULTS OF SHAREHOLDER MEETING (UNAUDITED)
A special meeting of shareholders of the American Beacon Balanced Fund and
the American Beacon Enhanced Income Fund (each a "Fund") of the American Beacon
Funds (the "Trust") was held on February 13, 2009. The shareholders of the Funds
were asked to vote on a proposal to approve and ratify an advisory fee under the
current Investment Management Agreement between American Beacon Advisors, Inc.
(the "Manager") and the Funds (the "Investment Management Agreement.")
Shareholders previously approved the Investment Management Agreement at a
special meeting held on August 22, 2008 in connection with the change of control
of the Manager. The proxy statement provided to shareholders in connection with
that meeting accurately disclosed that there were no proposed changes to the
total aggregate fees payable to the Manager for management, advisory, securities
lending and administrative services provided to the Funds. However, the advisory
fee had been inadvertently omitted from the fee schedule to the form of the
Investment Management Agreement and comparative fee table included as appendices
to the proxy statement provided to shareholders in connection with that meeting.
This proposal required a majority of shareholders of each Fund to achieve a
quorum.
The shareholders of the Funds passed the vote with the following results:
FUND FOR AGAINST ABSTAIN NON-VOTING
---- -------------- ------------ --------- ----------
Balanced 601,896,430.17 1,636,527.29 71,959.48 -0-
Enhanced Income 83,387,906.04 24,152.10 -0- -0-
50
(This Page Intentionally left blank)
51
(AMERICAN BEACON FUNDS(SM) LOGO)
DELIVERY OF DOCUMENTS
To reduce expenses, your financial institution may mail only one copy of the
Prospectus, Annual Report and Semi-Annual Report to those addresses shared by
two or more accounts. If you wish to receive individual copies of these
documents, please contact your financial institution. Delivery of individual
copies will commence thirty days after receiving your request. If you invest in
the Fund through a financial institution, you may be able to receive the Fund's
regulatory mailings, such as the Prospectus, Annual Report and Semi-Annual
Report, by e-mail. If you are interested in this option, please go to
www.icsdelivery.com and search for your financial institution's name or contact
your financial institution directly.
TO OBTAIN MORE INFORMATION ABOUT THE FUND:
(GRAPHIC)
BY E-MAIL:
american_beacon.funds@ambeacon.com
(GRAPHIC)
BY TELEPHONE:
Institutional Class
Call (800) 658-5811
AMR Class(SM)
Call (800) 345-2345
Investor Class(R) and Advisor Class
Call (800) 388-3344
(GRAPHIC)
ON THE INTERNET:
Visit our website at www.americanbeaconfunds.com
(GRAPHIC)
BY MAIL:
American Beacon Funds
P.O. Box 219643
Kansas City, MO 64121-9643
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
In addition to the Schedule of Investments provided in each semi-annual and
annual report, the Fund files a complete schedule of its portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q as of the first and
third fiscal quarters. The Fund's Forms N-Q are available on the SEC's website
at www.sec.gov. The Forms N-Q may also be reviewed and copied at the SEC's
Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549. Information
regarding the operation of the SEC's Public Reference Room may be obtained by
calling 1-800-SEC-0330. A complete schedule of the Fund's portfolio holdings is
also available on the Funds' website (www.americanbeaconfunds.com) approximately
thirty days after the end of each month.
AVAILABILITY OF PROXY VOTING POLICY AND RECORDS
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available in the Fund's
Statement of Additional Information, is available free of charge on the Fund's
website (www.americanbeaconfunds.com) and by calling 1-800-967-9009 or by
accessing the SEC's website at www.sec.gov. The Fund's proxy voting record for
the most recent year ended June 30 is filed annually with the SEC on Form N-PX.
The Fund's Forms N-PX are available on the SEC's website at www.sec.gov. The
Fund's proxy voting record may also be obtained by calling 1-800-967-9009.
FUND SERVICE PROVIDERS:
CUSTODIAN TRANSFER AGENT INDEPENDENT REGISTERED DISTRIBUTOR
STATE STREET BANK AND BOSTON FINANCIAL DATA PUBLIC ACCOUNTING FORESIDE FUND SERVICES
TRUST SERVICES FIRM Portland, Maine
Boston, Massachusetts Kansas City, Missouri ERNST & YOUNG LLP
Dallas, Texas
This report is prepared for shareholders of the American Beacon Funds and may be
distributed to others only if preceded or accompanied by a current prospectus.
American Beacon Funds, American Beacon High Yield Bond Fund, American Beacon
Enhanced Income Fund, American Beacon Intermediate Bond and American Beacon
Short-Term Bond Fund are service marks of American Beacon Advisors, Inc.
SAR 04//09
00068036
GUIDANCE | VISION | EXPERIENCE
(AMERICAN BEACON FUNDS(SM) LOGO)
SEMI-ANNUAL REPORT
(GRAPHIC)
APRIL 30, 2009
HIGH YIELD BOND FUND
ENHANCED INCOME FUND
INTERMEDIATE BOND FUND
SHORT-TERM BOND FUND
About American Beacon Advisors
Since 1986, American Beacon Advisors has offered a variety of products and
investment advisory services to numerous institutional and retail clients,
including a variety of mutual funds, corporate cash management, and separate
account management.
Our clients include defined benefit plans, defined contribution plans,
foundations, endowments, corporations, financial planners, and other
institutional investors. With American Beacon Advisors, you can put the
experience of a multi-billion dollar asset management firm to work for your
company.
Contents
Message from American Beacon............ 1
Market and Performance Overviews........ 2-10
American Beacon Schedules of Investments
High Yield Bond Fund................. 13
Enhanced Income Fund................. 22
Intermediate Bond Fund............... 28
Short-Term Bond Fund................. 38
Additional Information.................. Back Cover
Any opinions herein, including forecasts, reflect our judgment as of the end of
the reporting period and are subject to change. Each advisor's strategies and
each Fund's portfolio composition will change depending on economic and market
conditions. This report is not a complete analysis of market conditions and
therefore, should not be relied upon as investment advice. Although economic and
market information has been compiled from reliable sources, American Beacon
Advisors, Inc. makes no representation as to the completeness or accuracy of the
statements contained herein.
(PHOTO OF GENE L. NEEDLES)
FELLOW SHAREHOLDERS,
Please allow me to introduce myself. I am Gene Needles, Jr., the new
Executive Vice President for the American Beacon Funds. I have over 27 years of
financial services experience with some of the country's largest fund complexes,
and I will be primarily responsible for daily operations as well as distribution
of the American Beacon Funds. I am very excited to be a part of American Beacon
and look forward to building a lasting relationship with all of our
shareholders.
Enclosed is the American Beacon Funds Semi-Annual Report for the six months
ended April 30, 2009 for our High Yield Bond, Enhanced Income, Intermediate
Bond, and Short-Term Bond Funds.
During the six month period covered by this report, the capital markets
experienced widespread volatility brought on by concern over the world-wide
credit crisis. The American Beacon Intermediate Bond Fund - Institutional Class
reported a six-month return of 8.56% for the period ended April 30, 2009 while
the Barclays Capital Aggregate Index reported a return of 7.74% for this period.
In the past, long-term investors have been rewarded for their patience. We
continue to believe the Funds' fundamental investment strategies will continue
to serve the Funds well over time.
Please review the enclosed market overview, portfolio listings, and
detailed financial data. As always, we welcome the opportunity to serve your
financial needs. To obtain further details about the American Beacon Funds
family or to access your account information, please visit our website at
www.americanbeaconfunds.com. Thank you for your continued confidence in the
American Beacon Funds.
Sincerely,
/s/ Gene L. Needles, Jr.
Gene L. Needles, Jr.
Executive Vice President
American Beacon Funds
1
DOMESTIC BOND MARKET OVERVIEW
APRIL 30, 2008 (UNAUDITED)
The period began during the depths of financial market despair after the
bankruptcy of Lehman and conservatorship of Fannie Mae and Freddie Mac, followed
by government bailouts of major financial firms. Credit markets ground almost to
a halt, and fears were rampant that another Great Depression could possibly
occur. While the U.S. economy had been in a recession for some time, the pace of
economic decline accelerated and spread across the globe. With even good
companies unable to access credit markets, default rates began to escalate.
After a brutal two months that began the year, the month of March came back
to life. Investors found renewed confidence in the much advertised changes
promised by the Obama administration, legislative actions in Congress and an
ever expanding series of rescue packages from the U.S. Treasury and Federal
Reserve ("Fed"). However, the numerous programs intended to stabilize the
nation's banking system have created as much anxiety as hope among investors
worried that a "shot gun approach" may be long on spending but short on success.
Concern was magnified as economic news continued to verify the persistence
of the worst recession in over 25 years. Final Gross Domestic Product for the
fourth quarter of 2008 was a dismal -6.8%, the worst performance since 1982. Not
surprisingly, consumer confidence fell to the lowest level on record, while the
loss of over five million jobs in the past 15 months pushed the unemployment
rate to 8.5%. As the nearly $800 billion stimulus package designed to help the
economy recover "began" to be spent, the administration's focus has moved back
to the financial system.
Concerned about extreme and persistent economic weakness, but with the Fed
Funds rate already effectively at 0%, the Fed applied shock therapy in its
mid-March announcement of a plan to purchase up to $300 billion in Treasuries in
the secondary market over the next six months. This action essentially targeted
economic stimulus through a direct increase in the money supply, versus the more
indirect method of "credit easing" via lower rates and lending terms.
2
HIGH YIELD BOND MARKET OVERVIEW
APRIL, 30 2009 (UNAUDITED)
Despite the strong 14.0% return for the JPMorgan Global High-Yield Index
for the six months ended April 30, 2009, the period began during the depths of
financial market despair following the bankruptcy of Lehman and conservatorship
of Fannie Mae and Freddie Mac, followed by government bailouts of major
financial firms. Credit markets ground almost to a halt, and fears were rampant
that another Great Depression could possibly occur. While the U.S. economy had
been in a recession for some time, the pace of economic decline accelerated and
spread across the globe. With even good companies unable to access credit
markets, default rates began to escalate. In this environment, high yield bonds
began the period with their second worst monthly performance in history (dating
back to 1986), having just come off their worst month ever in October 2008. High
yield spreads began the period at 15%, eventually rising to a peak above 19% in
December.
With valuations at severely depressed levels, and with the hope that
government stimulus plans would ultimately work, investors began returning to
the high yield sector toward year-end 2008, driving a technical rally into the
beginning of 2009 that was focused mainly on higher quality (BB-rated) high
yield credits. However, the fundamental picture remained generally poor, leading
to significant volatility as the opposing factors of strong technicals and weak
fundamentals waged battle.
As the semi-annual period neared an end, signs began to emerge that perhaps
the worst of the economic downturn was past, thus leading investors to seek out
riskier assets. In April 2009, the high yield index experienced its highest
monthly return ever, as investors continued to put money into the asset class
and began seeking out higher return opportunities. The spread tightened
significantly down to 12.5%, but still remained well above its long-term average
of around 6%. With lower-quality (CCC-rated) credits leading the rally, the new
issue market is beginning to open to companies rated below BB. While the economy
still faces serious challenges, the ability of companies to refinance maturing
debt and pay down bank lines could lead to a fundamental improvement in credit
quality for select companies over the coming months.
3
PERFORMANCE OVERVIEW
AMERICAN BEACON HIGH YIELD BOND FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the High Yield Bond Fund returned 11.12%
for the six months ended April 30, 2009. The Fund underperformed the JPMorgan
Global High-Yield Index ("Index") return of 13.98% but outperformed the Lipper
High Current Yield Funds Index, which gained 7.44% for the period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
-----------------------------------------
SINCE
INCEP.
6 MONTHS* 1 YEAR 5 YEARS (12/29/00)
--------- ------ ------- ----------
Institutional
Class(1,5)............ 11.12% -17.96% 0.40% 4.46%
Investor
Class(1,2,5).......... 10.96% -18.28% 0.15% 4.21%
AMR Class (1,3,5)........ 11.25% -17.74% 0.49% 4.52%
JPMorgan GlobaL
High-Yield Index(4)... 13.98% -14.70% 2.08% 5.47%
Lipper High Current
Yield Funds Index(4).. 7.44% -19.33% 0.34% 2.82%
* Not annualized
1. The Investor Class was formerly known as the PlanAhead Class. Performance
shown is historical and may not be indicative of future returns. Investment
returns and principal value will vary, and shares may be worth more or less
at redemption than at original purchase. Performance shown is as of date
indicated, and current performance may be lower or higher than the
performance data quoted. To obtain performance as of the most recent month
end, please visit www.americanbeaconfunds.com or call 1-800-967-9009. Fund
performance in the table above does not reflect the deduction of taxes a
shareholder would pay on distributions or the redemption of shares. A
portion of the fees charged to the Institutional Class of the Fund was
waived through 2004. Performance prior to waiving fees was lower than the
actual returns shown for periods through 2004.
2. Fund performance for the since inception period represents the total
returns achieved by the Institutional Class from 12/29/00 up to 3/1/02, the
inception date of the Investor Class, and the returns of the Investor Class
since its inception. Expenses of the Investor Class are higher than those
of the Institutional Class. As a result, total returns shown may be higher
than they would have been had the Investor Class been in existence since
12/29/00.
3. Fund performance for the five-year and since inception periods represents
the total returns achieved by the Institutional Class from 12/29/00 up to
9/4/07, the inception date of the AMR Class, and the returns of the AMR
Class since its inception. Expenses of the AMR Class are lower than those
of the Institutional Class. As a result, total returns shown may be lower
than they would have been had the AMR Class been in existence since
12/29/00.
4. The JPMorgan Global High-Yield Index ("JPMorgan Index") is an unmanaged
index of fixed income securities with a maximum credit rating of BB+ or
Ba1. Issues must be publicly registered or issued under Rule 144A under the
Securities Act of 1933, with a minimum issue size of $75 million (par
amount). A maximum of two issues per issuer are included in the JPMorgan
Index. Convertible bonds, preferred stock, and floating-rate bonds are
excluded from the JPMorgan Index. The Lipper High Current Yield Funds Index
tracks the results of the 30 largest mutual funds in the Lipper High
Current Yield Funds category. Lipper is an independent mutual fund research
and ranking service. One cannot directly invest in an index.
5. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional, Investor, and AMR Class shares was
0.86%, 1.11%, and 0.59%, respectively. The expense ratios above may vary
from the expense ratios presented in other sections of this report that are
based on expenses incurred during the period covered by this report.
The Fund underperformed the Index over the six-month period due to the
Fund's cash balances returning less than the Index, issue selection from a
sector perspective and credit quality allocation. Sector allocation and issue
selection from a credit quality perspective added value for the period.
From a sector standpoint, issue selection in the Manufacturing,
Finance, and Utility sectors contributed to the relative underperformance,
despite positive contribution from selections in the Service, Consumer, and
Energy sectors.
From a sector allocation perspective, the Fund benefited from
underweighting the Manufacturing sector (up 6.6%) and overweighting the period's
top performing sector, Finance (up 27.5%). Overweighting the Cable/Media sector
(up 8.5%) detracted from performance.
From a credit quality perspective, issue selections in the CC and
BB-rated credit groups added value, while selections in the CCC-rated credit
group hurt performance.
From a credit quality allocation perspective, overweighting the
A-rated credit group and underweighting the BB-rated group contributed
significantly to the relative underperformance.
The sub-advisors' "bottom-up", research intensive investment process,
which focuses on companies with strong cash flow and fundamental credit
strength, remains in place.
4
PERFORMANCE OVERVIEW
AMERICAN BEACON HIGH YIELD BOND FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
HCA, Inc., 9.125%, Due 11/15/2014............................ 1.4%
Ford Motor Credit Co. LLC, 9.875%, Due 8/10/2011............. 1.3%
Freeport-McMoRan Copper & Gold, Inc., 8.375%, Due 4/1/2017... 1.2%
Inmarsat Finance II plc, 10.375%, Due 11/15/2012............. 1.1%
Texas Competitive Electric Holdings Co. LLC, 10.25%, Due
11/1/2015................................................. 1.1%
GMAC LLC, 6.875%, Due 9/15/2011.............................. 1.0%
Ford Motor Credit Co. LLC, 9.75%, Due 9/15/2010.............. 1.0%
Crown Castle International Corp., 9.00%, Due 1/15/2015....... 1.0%
SunGard Data Systems, Inc., 10.25%, Due 8/15/2015 ........... 1.0%
Rio Tinto Finance USA Ltd., 9.00%, Due 5/1/2019.............. 0.9%
FIXED INCOME SECTOR ALLOCATION
% OF
FIXED INCOME
------------
Corporate..... 99.4%
Convertibles.. 0.4%
CMO........... 0.2%
EQUITY SECTOR ALLOCATION
% OF
EQUITY INCOME
-------------
Financials.... 100.0%
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
Investing in high yield securities involves additional risks when compared to
investing in investment grade securities. These include a greater risk of
default or bankruptcy and an increased sensitivity to financial difficulties or
changes in interest rates.
5
PERFORMANCE OVERVIEW
AMERICAN BEACON ENHANCED INCOME FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Investor Class of the Enhanced Income Fund returned 10.09% for the
six months ended April 30, 2009. Its benchmark, a blend of 75% Barclays Capital
Aggregate and 25% Merrill Lynch All U.S. Convertibles Index, returned 8.85%. The
Fund's peer group, the Lipper Intermediate Investment Grade Index, returned
5.97% for the same period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
SINCE
INCEP.
6 MONTHS* 1 YEAR 5 YEARS (7/1/03)
--------- ------ ------- --------
Investor Class(1,4) ......... 10.09% -2.11% 3.14% 3.13%
Enhanced Income
Composite Index(3) ....... 8.85% -4.36% 3.00% 3.14%
Barclays Capital
Aggregrate Index (2) ..... 7.75% 3.84% 4.78% 6.01%
Merrill Lynch All U.S. ......
Convertibles Index (2) ... 11.50% -27.25% -1.50% 0.87%
Lipper Intermediate
Investment Grade
Index (2) ................ 5.97% -3.10% 2.75% 2.45%
* Not annualized
1. The Investor Class was formerly known as the PlanAhead Class. Performance
shown is historical and may not be indicative of future returns. Investment
returns and principal value will vary, and shares may be worth more or less
at redemption than at original purchase. Performance shown is as of date
indicated, and current performance may be lower or higher than the
performance data quoted. To obtain performance as of the most recent month
end, please visit www.americanbeaconfunds.com or call 1-800-967-9009. Fund
performance in the table above does not reflect the deduction of taxes a
shareholder would pay on distributions or the redemption of shares.
2. The Barclays Capital Aggregate Index represents returns of the Barclays
Capital Gov./Credit Intermediate Index ("Intermediate Index") up to October
31, 2006 and the Barclays Capital Aggregate Index ("Aggregate Index")
thereafter. The Intermediate Index is an unmanaged index of investment
grade corporate and government debt issues with maturities between one and
ten years. The Aggregate Index is a market value weighted index of
government, corporate, mortgage-backed and asset-backed fixed-rate debt
securities of all maturities. The Merrill Lynch All U.S. Convertibles Index
is an unmanaged index of domestic securities of all quality grades that are
convertible into U.S. dollar-denominated common stock, ADRs or cash
equivalents. The Lipper Intermediate Investment Grade Index tracks the
results of the 30 largest mutual funds in the Lipper Intermediate
Investment Grade category. Lipper is an independent mutual fund research
and ranking service. One cannot directly invest in an index.
3. To reflect the Fund's allocation of its assets between investment grade
fixed-income securities and convertible securities, the returns of the
Barclays Capital Aggregate Index and the Merrill Lynch All U.S.
Convertibles Index have been combined in a 75%/25% proportion.
4. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Investor Class shares was 1.04%. The expense ratio
above may vary from the expense ratio presented in other sections of this
report that is based on expenses incurred during the period covered by this
report.
The Fund's assets have been allocated approximately 75% to American
Beacon Advisors, Inc. (the "Manager") which invests primarily in income
producing, short- and intermediate-term investment grade bonds and 25% to a
sub-advisor which invests in securities including convertible bonds, convertible
preferreds, high yield bonds, and equities in order to try to enhance the return
of the overall Fund.
During the six-month period, the investment grade bond portion of the
Fund returned 9.1% before expenses outperforming the 7.7% return for the
Barclays Capital Aggregate Index. This portion of the Fund benefited from
holdings in Treasuries and Commercial Mortgage Backed securities, which added to
relative performance.
The remaining portion of the Fund, managed by the Fund's sub-advisor,
returned 12.8% before expenses. These results exceeded the 11.5% return of the
Merrill Lynch All U.S. Convertibles Index. This portion of the Fund's greater
equity sensitivity relative to its benchmark helped performance in the period.
Broadly speaking, convertible issues with higher equity sensitivity performed
better, reflecting an increase in market volatility, as well as their underlying
stocks performing better than the broad equity market during the period. The
sub-advisor also utilized common stocks and corporate bonds in order to better
manage the risk/reward profile of this portion of the Fund. The common stock
holdings detracted from performance in the period, as the equity market
suffered, yet the straight corporate bond holdings added to results as they
outperformed the convertible benchmark return.
The Manager and the Fund's sub-advisor remain focused on the Fund's
investment objectives of generating income and capital appreciation.
6
PERFORMANCE OVERVIEW
AMERICAN BEACON ENHANCED INCOME FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
U.S. Treasury Note, 4.125%, Due 5/15/2015 ..................... 3.3%
Federal Home Loan Mortgage Corp., Pool #G08079, 5.00%, Due
9/1/2035 ................................................... 2.7%
U.S. Treasury, 1.375%, Due 3/15/2012 .......................... 2.4%
U.S. Treasury, 6.25%, Due 8/15/2023 ........................... 2.2%
Federal Home Loan Mortgage Corp., Pool #G08255, 5.00%, Due
3/1/2038 ................................................... 1.9%
Citigroup, Inc., 5.125%, Due 2/14/2011 ........................ 1.8%
Federal Home Loan Mortgage Corp., Pool #G08269, 5.50%, Due
5/1/2038 ................................................... 1.8%
Federal National Mortgage Association, Pool #745418, 5.50%,
Due 4/1/2036 ............................................... 1.7%
American Express Credit Account Master Trust, 5.35%, Due
1/15/2014 .................................................. 1.6%
HSBC Finance Corp., 5.25%, Due 1/14/2011 ...................... 1.5%
FIXED-INCOME SECTOR ALLOCATION
% OF
FIXED INCOME
------------
Corporate Bonds..... 36.2%
Mortgage-Backed..... 29.9%
Convertible Bonds... 15.5%
Treasury............ 13.0%
Asset-Backed........ 4.1%
Agency.............. 1.3%
EQUITY SECTOR ALLOCATION
% OF
EQUITIES
--------
Financials................ 22.3%
Information Technology.... 17.2%
Consumer Staples.......... 13.6%
Energy.................... 13.5%
Consumer Discretionary.... 10.9%
Health Care............... 10.2%
Materials................. 6.4%
Industrials............... 5.9%
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
7
PERFORMANCE OVERVIEW
AMERICAN BEACON INTERMEDIATE BOND FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Intermediate Bond Fund returned 8.56%
for the six months ended April 30, 2009, outperforming the Barclays Capital
Aggregate Index ("Index") return of 7.75% and the Lipper Intermediate Investment
Grade Debt Funds Index return of 5.97% for the same period.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
--------- ------ ------- --------
Institutional Class(1,4) ... 8.56% 3.54% 4.82% 5.46%
Investor Class (1,2,4) ..... 8.50% 3.47% 4.80% 5.45%
Barclays Capital Agg. ......
Index (3) ............... 7.75% 3.84% 4.78% 5.71%
Lipper Intermediate Inv. ...
Grade Index (3) ......... 5.97% -3.10% 2.75% 4.48%
* Not annualized
1. Performance shown is historical and may not be indicative of future
returns. Investment returns and principal value will vary, and shares may
be worth more or less at redemption than at original purchase. Performance
shown is as of date indicated, and current performance may be lower or
higher than the performance data quoted. To obtain performance as of the
most recent month end, please visit www.americanbeaconfunds.com or call
1-800-967-9009. Fund performance in the table above does not reflect the
deduction of taxes a shareholder would pay on distributions or the
redemption of shares. Performance shown reflects the Fund's receipt in
December 2006 and March 2008 of class action proceeds that were related to
investment activity in 2002. The Fund's performance was higher than it
would have been absent receipt of the settlement proceeds.
2. Fund performance represents the total returns achieved by the Institutional
Class up to 3/2/09, the inception date of the Investor Class, and the
returns of the Investor Class since its inception. Expenses of the Investor
Class are higher than those of the Institutional Class. As a result, total
returns shown may be higher than they would have been had the Investor
Class been in existence since 4/30/99.
3. The Barclays Capital Aggregate Index is a market value weighted index of
government, corporate, mortgage-backed and asset-backed fixed-rate debt
securities of all maturities. The Lipper Intermediate Investment Grade
Index tracks the results of the 30 largest mutual funds in the Lipper
Intermediate Investment Grade category. Lipper is an independent mutual
fund research and ranking service. One cannot directly invest in an index.
4. The total annual Fund operating expense ratios set forth in the most recent
Fund prospectus for the Institutional and Investor Class shares was 0.31%
and 0.88%, respectively. The expense ratios above may vary from the expense
ratios presented in other sections of this report that is based on expenses
incurred during the period covered by this report.
The Fund's excess performance relative to the Index was primarily due
to good security selection among U.S. Treasuries, Commercial Mortgage-Backed and
Corporate securities. The Fund's overweighting in the Corporate sector, the top
performing sector in the Index, also contributed to relative performance,
although the outperformance was largely offset by a small allocation to
Collateralized Mortgage Obligations.
The average duration of the Fund's portfolio was slightly longer than
the Index over the course of the six months, with holdings in the three- to
five-year duration range adding the most value relative to the Index.
The Fund's investment managers remain focused on a conservative
approach toward investing in the bond market and on issuer-specific
opportunities.
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
Federal National Mortgage Association, Pool #961981, 5.50%,
Due 3/1/2038 ................................................ 3.3%
Federal National Mortgage Association, Pool #982033, 5.00%,
Due 4/1/2038 ................................................ 3.2%
U.S. Treasury Note, 4.125%, Due 5/15/2015 ...................... 2.5%
Federal Home Loan Mortgage Corp., 1.50%, Due 1/7/2011 .......... 2.2%
Morgan Stanley (FDIC Guaranteed), 2.25%, Due 3/13/2012 ......... 2.2%
Citibank NA (FDIC Guaranteed), 1.625%, Due 3/30/2011 ........... 2.2%
Federal Home Loan Mortgage Corp., 5.125%, Due 4/18/2011 ........ 2.1%
Federal National Mortgage Association, 5.375%, Due 6/12/2017 ... 2.0%
U.S. Treasury, 2.75%, Due 2/15/2019 ............................ 2.0%
Federal National Mortgage Association, Pool #982817, 5.00%,
Due 5/1/2038 ................................................ 1.8%
SECTOR ALLOCATION
% OF
FIXED INCOME
------------
Mortgage-Backed... 40.2%
Corporates........ 28.2%
U.S. Treasury..... 15.6%
U.S. Agency....... 14.9%
Asset-Backed...... 1.1%
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
8
PERFORMANCE OVERVIEW
AMERICAN BEACON SHORT-TERM BOND FUND(SM)
APRIL 30, 2009 (UNAUDITED)
The Institutional Class of the Short-Term Bond Fund returned 2.96% for
the six months ended April 30, 2009, which underperformed the Merrill Lynch 1-3
Year Gov/Corp Index ("Index") return of 3.44% but outperformed the Lipper Short
Investment Grade Bond Funds Index ("Lipper") return of 2.31%.
ANNUALIZED TOTAL RETURNS
PERIODS ENDED 4/30/09
---------------------------------------
6 MONTHS* 1 YEAR 5 YEARS 10 YEARS
--------- ------ ------- --------
Institutional Class(1,3) ... 2.96% 2.38% 3.51% 4.47%
Investor Class(1,3) ........ 2.84% 1.99% 2.99% 3.97%
Lipper Short Inv. Grade
Index(2) ................ 2.31% -2.42% 1.97% 3.34%
Merrill Lynch 1-3 Yr. ......
Gov./Corp. Index(2) ..... 3.44% 3.57% 3.91% 4.73%
* Not annualized
1. The Investor Class was formerly known as the PlanAhead Class. Performance
shown is historical and may not be indicative of future returns. Investment
returns and principal value will vary, and shares may be worth more or less
at redemption than at original purchase. Performance shown is as of date
indicated, and current performance may be lower or higher than the
performance data quoted. To obtain performance as of the most recent month
end, please visit www.americanbeaconfunds.com or call 1-800-967-9009. Fund
performance in the table above does not reflect the deduction of taxes a
shareholder would pay on distributions or the redemption of shares. A
portion of the fees charged to the Investor Class of the Fund has been
waived. Performance prior to waiving fees was lower than the actual returns
shown. Performance shown reflects the Fund's receipt in December 2006 and
March 2008 of class action proceeds that were related to investment
activity in 2002. The Fund's performance was higher than it would have been
absent receipt of the settlement proceeds.
2. The Merrill Lynch 1-3 Yr. Gov./Corp. Index is a market value weighted
performance benchmark for government and corporate fixed-rate debt
securities with maturities between one and three years. The Lipper Short
Investment Grade Bond Funds Index tracks the results of the 30 largest
mutual funds in the Lipper Short Investment Grade Bond Funds category.
Lipper is an independent mutual fund research and ranking service. One
cannot directly invest in an index.
3. The total annual Fund operating expense ratio set forth in the most recent
Fund prospectus for the Institutional and Investor Class shares was 0.32%
and 0.89%, respectively. The expense ratios above may vary from the expense
ratios presented in other sections of this report that are based on
expenses incurred during the period covered by this report.
As compared to the Index, the Fund underperformed slightly due to a
modest underweight position in the Corporate sector. The Corporate sector had
the highest returns among the Index sectors during the period as the markets
began to recover in early 2009.
The Fund generally maintains an overweight position in
investment-grade Corporate securities to generate incremental yield-to-maturity
compared to the Index. However, due to the unusually volatile markets over the
past year and due to unusual volatility in the Fund's asset balances, the Fund
maintained a large position in the Treasury and Agency sectors for liquidity
purposes. This position is expected to be temporary, and we look to reassume our
overweight position in the Corporate sector as the markets normalize.
Duration did not play a significant role during the period as the
Fund's duration was essentially neutral to that of the Index. Looking forward,
with interest rates at such low levels, the Fund will likely seek a duration
range of neutral-to-short of the Index while the economy regains its footing and
interest rates begin to rise.
Overall, the period was challenging, but we remain confident in the
long-term success of the Fund's investment strategy. Markets have begun to
stabilize, and the worst of the financial crisis appears to be behind us.
However, the recovery is not expected to be swift and will require diligence as
it unfolds. We will continue to be conservative in our approach to credit risk,
and we will look to take advantage of opportunities in this market to generate
attractive long-term results.
9
PERFORMANCE OVERVIEW
AMERICAN BEACON SHORT-TERM BOND FUND(SM)
APRIL 30, 2009 (UNAUDITED)
TOP TEN HOLDINGS
% OF
NET ASSETS
----------
U.S. Treasury Note, 4.375%, Due 12/15/2010 ............... 9.7%
U.S. Treasury Note, 1.50%, Due 10/31/2010 ................ 9.3%
Federal Home Loan Mortgage Corp., 2.125%, Due 3/23/2012 .. 9.3%
Federal Home Loan Mortgage Corp., 1.625%, Due 4/26/2011 .. 9.2%
U.S. Treasury Note, 2.875%, Due 6/30/2010 ................ 4.7%
Bank of American Corp. (FDIC Guaranteed), 2.375%, Due
6/22/2012 ............................................. 4.7%
Goldman Sachs Group, Inc. (FDIC Guaranteed), 1.70%, Due
3/15/2011 ............................................. 4.6%
Morgan Stanley (FDIC Guaranteed), 2.25%, Due 3/13/2012 ... 4.6%
Citibank NA (FDIC Guaranteed), 1.625%, Due 3/30/2011 ..... 4.6%
Federal National Mortgage Association, 1.375%, Due
4/28/2011 ............................................. 4.6%
SECTOR ALLOCATION
% OF
FIXED INCOME
------------
Agency.............. 53.5%
Treasury............ 22.7%
Corporate Bonds..... 18.0%
Asset-Backed........ 4.3%
Mortgage-Backed..... 1.5%
Investing in debt securities entails interest rate risk which is the risk that
debt securities will decrease in value with increases in market interest rates.
10
FUND EXPENSES - ACTUAL
APRIL 30, 2009 (UNAUDITED)
FUND EXPENSE EXAMPLE
As a shareholder of a Fund, you incur two types of costs: (1) transaction
costs, including redemption fees if applicable, and (2) ongoing costs, including
management fees, administrative service fees, and other Fund expenses. The
examples below are intended to help you understand the ongoing cost (in dollars)
of investing in a particular Fund and to compare these costs with the ongoing
costs of investing in other mutual funds. The examples are based on an
investment of $1,000 invested at the beginning of the period in each Class and
held for the entire period from November 1, 2008 through April 30, 2009.
ACTUAL EXPENSES
The following tables provide information about actual account values and
actual expenses. You may use the information on this page, together with the
amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.6), then multiply the result by the "Expenses Paid During
Period" for the applicable Fund to estimate the expenses you paid on your
account during this period. Shareholders of the Investor and Institutional
Classes that invest in a Fund through an IRA may be subject to a custodial IRA
fee of $12 that is typically deducted each December. If your account was subject
to a custodial IRA fee during the period, your costs would have been $12 higher.
HIGH YIELD INTERMEDIATE SHORT-TERM
INSTITUTIONAL CLASS BOND FUND BOND FUND BOND FUND
- ------------------- ---------- ------------ ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,111.17 $1,085.61 $1,029.64
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 4 .29 $ 1.55 $ 1.51
Annualized Expense Ratio ........................ 0.82% 0.30% 0.30%
HIGH YIELD ENHANCED INTERMEDIATE SHORT-TERM
INVESTOR CLASS BOND FUND INCOME FUND BOND FUND BOND FUND
- -------------- ---------- ----------- ------------ ----------
Beginning Account Value 11/1/08 .. $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 ..... $1,109.64 $1,100.90 $1,012.81 $1,028.42
Expenses Paid During Period
11/1/08-4/30/09 * ............. $ 5.54 $ 4.95 $ 1.04 $ 2.72
Annualized Expense Ratio ......... 1.06% 0.95% 0.64% 0.54%
HIGH YIELD
AMR CLASS BOND FUND
- --------- ----------
Beginning Account Value 11/1/08 .. $1,000.00
Ending Account Value 4/30/2009 ... $1,112.53
Expenses Paid During Period
11/1/08-4/30/09 * ............. $ 2.99
Annualized Expense Ratio ......... 0.57%
* Expenses are equal to the Fund's annualized expense ratio for the six-month
period multiplied by the average account value over the period, multiplied
by the number derived by dividing the number of days in the most recent
fiscal half-year (181) by days in the year (365) to reflect the half-year
period.
11
FUND EXPENSES - HYPOTHETICAL
APRIL 30, 2009 (UNAUDITED)
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The following tables provide information about hypothetical account values
and hypothetical expenses based on a Fund's actual expense ratio and an assumed
5% per year rate of return before expenses (not the Fund's actual return). You
may compare the ongoing costs of investing in a particular Fund with other funds
by contrasting this 5% hypothetical example and the 5% hypothetical examples
that appear in the shareholder reports of the other funds. The hypothetical
account values and expenses may not be used to estimate the actual ending
account balance or expenses you paid for the period. Shareholders of the
Investor and Institutional Classes that invest in a Fund through an IRA may be
subject to a custodial IRA fee of $12 that is typically deducted each December.
If your account was subject to a custodial IRA fee during the period, your costs
would have been $12 higher.
You should also be aware that the expenses shown in the table highlight
only your ongoing costs and do not reflect any transaction costs charged by a
Fund, such as redemption fees as applicable. Similarly, the expense examples for
other funds do not reflect any transaction costs charged by those funds, such as
sales charges (loads), redemption fees or exchange fees. Therefore, the
following tables are useful in comparing ongoing costs only and will not help
you determine the relative total costs of owning different funds. If you were
subject to any transaction costs during the period, your costs would have been
higher.
HIGH YIELD INTERMEDIATE SHORT-TERM
INSTITUTIONAL CLASS BOND FUND BOND FUND BOND FUND
- ------------------- ---------- ------------ ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,020.73 $1,023.31 $1,023.31
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 4.11 $ 1.51 $ 1.51
Annualized Expense Ratio ........................ 0.82% 0.30% 0.30%
HIGH YIELD ENHANCED INTERMEDIATE SHORT-TERM
INVESTOR CLASS BOND FUND INCOME FUND BOND FUND BOND FUND
- -------------- ---------- ----------- ------------ ----------
Beginning Account Value 11/1/08 ................. $1,000.00 $1,000.00 $1,000.00 $1,000.00
Ending Account Value 4/30/09 .................... $1,019.54 $1,020.08 $1,021.62 $1,022.12
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 5.31 $ 4.76 $ 3.21 $ 2.71
Annualized Expense Ratio ........................ 1.06% 0.95% 0.64% 0.54%
HIGH YIELD
AMR CLASS BOND FUND
- --------- ----------
Beginning Account Value 11/1/08 ................. $1,000.00
Ending Account Value 4/30/09 .................... $1,021.97
Expenses Paid During Period 11/1/08-4/30/09 * ... $ 2.86
Annualized Expense Ratio ........................ 0.57%
- ----------
* Expenses are equal to the Fund's annualized expense ratio for the six-month
period multiplied by the average account value over the period, multiplied
by the number derived by dividing the number of days in the most recent
fiscal half-year (181) by days in the year (365) to reflect the half-year
period.
12
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
APRIL 30, 2009 (UNAUDITED)
SHARES VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
PREFERRED STOCKS - 0.09%
FINANCIALS - 0.09%
DIVERSIFIED FINANCIALS - 0.09%
Federal Home Loan Mortgage Corp. .................................. 10,000 $ 5
Preferred Blocker, Inc. ++ ........................................ 454 136
-----------
TOTAL PREFERRED STOCKS ............................................ 141
-----------
PAR
AMOUNT
------------
CORPORATE OBLIGATIONS - 94.42%
AUTO COMPONENTS - 0.66%
Allison Transmission, Inc., 11.00%, Due 11/1/2015 ++ .............. $ 900 540
Cooper-Standard Automotive, Inc., 8.375%, Due 12/15/2014 .......... 920 74
TRW Automotive, Inc., 7.25%, Due 3/15/2017 ++ ..................... 900 481
-----------
1,095
-----------
AUTO LOAN - 3.96%
Ford Motor Credit Co. LLC,
9.75%, Due 9/15/2010 ........................................... 1,875 1,687
9.875%, Due 8/10/2011 .......................................... 2,530 2,214
GMAC LLC,
5.625%, Due 5/15/2009 .......................................... 370 366
7.25%, Due 3/2/2011 ++ ......................................... 395 348
6.875%, Due 9/15/2011 ++ ....................................... 2,000 1,740
8.00%, Due 11/1/2031 ++ ........................................ 307 215
-----------
6,570
-----------
AUTOMOBILES - 0.05%
General Motors Corp., 8.375%, Due 7/15/2033 ....................... 970 82
-----------
BASIC MATERIALS - 1.24%
Anglo American Capital plc, 9.375%, Due 4/8/2014 ++ ............... 500 519
Rio Tinto Finance USA Ltd., 9.00%, Due 5/1/2019 ................... 1,500 1,542
-----------
2,061
-----------
CASINO/GAMING - 2.33%
Caesars Entertainment, Inc., 7.875%, Due 3/15/2010 ................ 500 295
Fontainebleau Las Vegas Holdings LLC, 11.00%, Due 6/15/2015 ++ .... 1,800 63
Las Vegas Sands Corp., 6.375%, Due 2/15/2015 ...................... 850 557
Mandalay Resort Group, 9.375%, Due 2/15/2010 ...................... 1,085 578
MGM Mirage,
6.00%, Due 10/1/2009 ........................................... 215 181
6.625%, Due 7/15/2015 .......................................... 1,400 712
Pinnacle Entertainment, Inc.,
8.25%, Due 3/15/2012 ........................................... 700 683
8.75%, Due 10/1/2013 ........................................... 100 96
Pokagon Gaming Authority, 10.375%, Due 6/15/2014 ++ ............... 600 555
Station Casinos, Inc.,
6.875%, Due 3/1/2016 ........................................... 500 16
See accompanying notes
13
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
7.75%, Due 8/15/2016 ........................................... $ 400 $ 136
-----------
3,872
-----------
COMMERCIAL SERVICES - 0.62%
Iron Mountain, Inc.,
8.75%, Due 7/15/2018 ........................................... 100 101
8.00%, Due 6/15/2020 ........................................... 300 290
RSC Equipment Rental, Inc., 9.50%, Due 12/1/2014 .................. 1,000 643
-----------
1,034
-----------
COMMUNICATIONS - 18.26%
CanWest Media, Inc., 8.00%, Due 9/15/2012 ......................... 800 208
CC Holdings GS V LLC, 7.75%, Due 5/1/2017 ++ ...................... 100 101
CCO Holdings LLC, 8.75%, Due 11/15/2013 # ......................... 1,200 1,041
Charter Communications Holdings LLC,
10.25%, Due 9/15/2010 .......................................... 1,100 1,001
13.50%, Due 1/15/2011 # ........................................ 1,100 6
1.00%, Due 1/15/2014 ........................................... 1,100 11
10.875%, Due 9/15/2014 ++ ...................................... 800 796
11.00%, Due 10/1/2015 .......................................... 800 62
Cricket Communications, Inc., 9.375%, Due 11/1/2014 ............... 1,285 1,272
Crown Castle International Corp., 9.00%, Due 1/15/2015 ............ 1,640 1,673
CSC Holdings, Inc.,
8.50%, Due 4/15/2014 ++ ........................................ 400 408
7.625%, Due 7/15/2018 .......................................... 400 384
8.625%, Due 2/15/2019 ++ ....................................... 525 529
Dex Media, Inc.,
9.875%, Due 8/15/2013 # ........................................ 970 276
8.00%, Due 11/15/2013 # ........................................ 1,100 132
9.00%, Due 11/15/2013 # ss. .................................... 400 48
Digicel Group Ltd.,
8.875%, Due 1/15/2015 ++ ....................................... 1,000 725
9.125%, Due 1/15/2015 ++ ....................................... 1,550 1,054
DirecTV Holdings LLC, 7.625%, Due 5/15/2016 ....................... 600 594
DISH DBS Corp.,
7.00%, Due 10/1/2013 ........................................... 790 754
7.125%, Due 2/1/2016 ........................................... 1,300 1,215
Frontier Communications Corp.,
8.25%, Due 5/1/2014 ............................................ 510 501
9.00%, Due 8/15/2031 ........................................... 830 660
HSN, Inc., 11.25%, Due 8/1/2016 ++ ................................ 650 475
Idearc, Inc., 8.00%, Due 11/15/2016 # ............................. 2,214 36
Intelsat Corp., 9.25%, Due 8/15/2014 ++ ........................... 750 728
Intelsat Jackson Holdings Ltd., 11.25%, Due 6/15/2016 ............. 700 716
Intelsat Subsidiary Holding Co. Ltd., 8.50%, Due 4/15/2013 ++ ..... 900 891
iPCS, Inc., 3.295%, Due 5/1/2013 ss. .............................. 315 255
See accompanying notes
14
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
L-3 Communications Corp.,
6.125%, Due 7/15/2013 .......................................... $ 200 $ 192
6.375%, Due 10/15/2015 ......................................... 200 189
Lamar Media Corp.,
7.25%, Due 1/1/2013 ............................................ 900 806
9.75%, Due 4/1/2014 ++ ......................................... 200 201
Liberty Media LLC, 5.70%, Due 5/15/2013 ........................... 1,000 840
LIN Television Corp., 6.50%, Due 5/15/2013 ........................ 1,000 580
Mediacom LLC, 9.50%, Due 1/15/2013 ................................ 830 813
MetroPCS Wireless, Inc.,
9.25%, Due 11/1/2014 ........................................... 1,000 1,001
9.25%, Due 11/1/2014 ++ ........................................ 200 199
Nortel Networks Ltd., 10.75%, Due 7/15/2016 ++ .................... 800 212
Quebecor Media, Inc., 7.75%, Due 3/15/2016 ........................ 1,300 1,086
Qwest Communications International, Inc., 7.50%, Due 2/15/2014 .... 800 742
Qwest Corp.,
4.57%, Due 6/15/2013 ss. ....................................... 460 416
8.375%, Due 5/1/2016 ++ ........................................ 975 970
6.875%, Due 9/15/2033 .......................................... 590 417
Radio One, Inc., 6.375%, Due 2/15/2013 ............................ 800 145
Sprint Capital Corp.,
7.625%, Due 1/30/2011 .......................................... 250 241
8.75%, Due 3/15/2032 ........................................... 1,525 1,159
Telesat Canada, 12.50%, Due 11/1/2017 ++ .......................... 825 685
Tim Hellas Telecommunications, 6.881%, Due 1/15/2015 ++ Ss. ....... 500 110
Time Warner Telecom Holdings, Inc., 9.25%, Due 2/15/2014 .......... 650 652
Univision Communications, Inc.,
7.85%, Due 7/15/2011 ........................................... 430 349
9.75%, Due 3/15/2015 ++ ........................................ 1,900 295
VIP Finance Ireland Ltd., 9.125%, Due 4/30/2018 ++ ................ 370 264
Virgin Media Finance PLC, 8.75%, Due 4/15/2014 .................... 875 866
Visant Holding Corp., 8.75%, Due 12/1/2013 ........................ 325 299
-----------
30,281
-----------
CONSTRUCTION & ENGINEERING - 0.26%
KB Home, 6.25%, Due 6/15/2015 ..................................... 500 428
-----------
CONSUMER DISCRETIONARY - 4.01%
Carrols Corp., 9.00%, Due 1/15/2013 ............................... 562 520
Dollar General Corp., 10.625%, Due 7/15/2015 ...................... 1,000 1,040
Education Management LLC, 10.25%, Due 6/1/2016 .................... 1,160 1,113
Jostens Holding Corp., 10.25%, Due 12/1/2013 Ss. .................. 150 142
Jostens IH Corp., 7.625%, Due 10/1/2012 ........................... 900 873
Meritage Homes Corp., 6.25%, Due 3/15/2015 ........................ 475 347
Michaels Stores, Inc., 10.00%, Due 11/1/2014 ...................... 1,000 605
Neiman Marcus Group, Inc., 9.00%, Due 10/15/2015 .................. 420 231
See accompanying notes
15
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
NPC International, Inc., 9.50%, Due 5/1/2014 ...................... $ 200 $ 179
Ryland Group, Inc., 8.40%, Due 5/15/2017 .......................... 575 563
Saks, Inc., 9.875%, Due 10/1/2011 ................................. 280 263
Staples, Inc., 9.75%, Due 1/15/2014 ............................... 275 302
Ticketmaster Entertainment, Inc., 10.75%, Due 8/1/2016 ++ ......... 690 471
-----------
6,649
-----------
CONSUMER STAPLES - 5.52%
Altria Group, Inc.,
9.70%, Due 11/10/2018 .......................................... 230 269
9.25%, Due 8/6/2019 ............................................ 500 572
CRC Health Corp., 10.75%, Due 2/1/2016 ............................ 1,115 758
Dean Foods Co., 7.00%, Due 6/1/2016 ............................... 1,000 975
Dole Food Co, Inc., 13.875%, Due 3/15/2014 ++ ..................... 900 947
Ingles Markets, Inc., 8.875%, Due 5/15/2017 ++ .................... 300 290
Jarden Corp.,
8.00%, Due 5/1/2016 ............................................ 615 600
7.50%, Due 5/1/2017 ............................................ 1,000 885
JBS USA LLC, 11.625%, Due 5/1/2014 ++ ............................. 1,600 1,520
Pinnacle Foods Finance LLC, 10.625%, Due 4/1/2017 ................. 1,125 844
Prestige Brands, Inc., 9.25%, Due 4/15/2012 ....................... 280 274
Reable Therapeutics, 11.75%, Due 11/15/2014 ....................... 550 355
Smithfield Foods, Inc., 7.75%, Due 5/15/2013 ...................... 400 282
SUPERVALU, Inc., 8.00%, Due 5/1/2016 .............................. 600 582
-----------
9,153
-----------
ENERGY - 14.19%
Chesapeake Energy Corp.,
9.50%, Due 2/15/2015 ........................................... 590 596
6.625%, Due 1/15/2016 ++ ....................................... 1,600 1,424
Cie Generale de Geophysique-Veritas, 7.50%, Due 5/15/2015 ......... 1,100 924
Compton Petroleum Finance Corp., 7.625%, Due 12/1/2013 ............ 750 287
Copano Energy LLC,
8.125%, Due 3/1/2016 ........................................... 800 728
7.75%, Due 6/1/2018 ++ ......................................... 200 175
Dynegy Holdings, Inc., 8.375%, Due 5/1/2016 ....................... 1,200 960
El Paso Corp.,
12.00%, Due 12/12/2013 ......................................... 700 756
8.25%, Due 2/15/2016 ........................................... 500 488
Forest Oil Corp., 8.50%, Due 2/15/2014 ++ ......................... 420 407
Helix Energy Solutions Group, Inc., 9.50%, Due 1/15/2016 ++ ....... 500 355
Intergen NV, 9.00%, Due 6/30/2017 ++ .............................. 1,000 950
Linn Energy LLC, 9.875%, Due 7/1/2018 ++ .......................... 1,280 1,152
Mariner Energy, Inc., 7.50%, Due 4/15/2013 ........................ 1,000 810
MarkWest Energy Partners LP,
6.875%, Due 11/1/2014 .......................................... 700 574
8.75%, Due 4/15/2018 ........................................... 675 560
See accompanying notes
16
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Mirant Americas Generation LLC, 8.30%, Due 5/1/2011 ............... $ 325 $ 325
Mirant North America LLC, 7.375%, Due 12/31/2013 .................. 1,000 962
NRG Energy, Inc.,
7.25%, Due 2/1/2014 ............................................ 1,300 1,254
7.375%, Due 2/1/2016 ........................................... 600 577
OPTI Canada, Inc., 8.25%, Due 12/15/2014 .......................... 775 426
Peabody Energy Corp.,
6.875%, Due 3/15/2013 .......................................... 700 686
7.375%, Due 11/1/2016 .......................................... 300 293
PetroHawk Energy Corp.,
9.125%, Due 7/15/2013 .......................................... 1,200 1,176
10.50%, Due 8/1/2014 ++ ........................................ 900 904
Plains Exploration & Production Co.,
10.00%, Due 3/1/2016 ........................................... 420 410
7.625%, Due 6/1/2018 ........................................... 1,000 868
Quicksilver Resources, Inc., 8.25%, Due 8/1/2015 .................. 1,000 815
Regency Energy Partners LP, 8.375%, Due 12/15/2013 ................ 402 376
SandRidge Energy, Inc., 8.00%, Due 6/1/2018 ++ .................... 1,000 875
Seitel, Inc., 9.75%, Due 2/15/2014 ................................ 550 270
Tennessee Gas Pipeline Co., 8.00%, Due 2/1/2016 ++ ................ 140 143
Tesoro Corp., 6.50%, Due 6/1/2017 ................................. 1,000 813
Williams Cos., Inc.,
7.625%, Due 7/15/2019 .......................................... 700 690
8.75%, Due 1/15/2020 ++ ........................................ 125 128
7.875%, Due 9/1/2021 ........................................... 400 395
-----------
23,532
-----------
FINANCE - 7.83%
American Real Estate Partners, L.P., 8.125%, Due 6/1/2012 ......... 745 663
E*Trade Financial Corp., 12.50%, Due 11/30/2017 ................... 1,328 661
Forest City Enterprises, Inc., 7.625%, Due 6/1/2015 ............... 800 384
Fresenius US Finance II, Inc., 9.00%, Due 7/15/2015 ++ ............ 700 742
Galaxy Entertainment Finance Co. Ltd., 9.875%, Due 12/15/2012 ++ .. 1,000 780
Hawker Beechcraft Acquisition Co. LLC, 9.75%, Due 4/1/2017 ........ 775 190
Hexion US Finance Corp., 9.75%, Due 11/15/2014 .................... 660 254
HUB International Holdings, Inc., 10.25%, Due 6/15/2015 ++ ........ 755 423
Hughes Network Systems LLC, 9.50%, Due 4/15/2014 .................. 850 795
International Lease Finance Corp.,
4.375%, Due 11/1/2009 .......................................... 405 385
5.75%, Due 6/15/2011 ........................................... 250 191
JP Morgan Chase & Co., 7.90%, Due 12/31/2049 ...................... 1,000 761
KAR Holdings, Inc., 10.00%, Due 5/1/2015 .......................... 975 565
LaBranche & Co., Inc., 11.00%, Due 5/15/2012 ...................... 600 546
Lehman Brothers Holdings, Inc., 6.20%, Due 9/26/2014 .............. 900 128
Liberty Mutual Group, Inc., 10.75%, Due 6/15/2058 ++ .............. 500 275
See accompanying notes
17
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Merrill Lynch & Co., Inc.,
6.40%, Due 8/28/2017 ........................................... $ 200 $ 163
6.875%, Due 4/25/2018 .......................................... 500 421
Nationwide Life Global Funding I, 1.42%, Due 12/14/2010 ++ ss. ... 325 297
Nuveen Investments, Inc., 5.00%, Due 9/15/2010 .................... 825 670
Petroplus Finance Ltd., 6.75%, Due 5/1/2014 ++ .................... 1,000 825
Rainbow National Services LLC, 10.375%, Due 9/1/2014 ++ ........... 525 546
Realogy Corp., 10.50%, Due 4/15/2014 .............................. 900 297
Rouse Company, 8.00%, Due 4/30/2009 ............................... 700 355
USI Holdings Corp., 5.113%, Due 11/15/2014 ++ ss. ................. 920 442
Wachovia Capital Trust III, 5.80%, Due 3/15/2042 .................. 500 232
Washington Mutual, Inc., 7.25%, Due 11/1/2017 ..................... 485 234
Wells Fargo Capital XIII, 7.70%, Due 12/29/2049 ................... 400 256
Wells Fargo Capital XV, 9.75%, Due 12/29/2049 ..................... 600 510
-----------
12,991
-----------
FOOD PRODUCTS - 0.37%
Tyson Foods, Inc., 10.50%, Due 3/1/2014 ++ ........................ 585 611
-----------
HEALTH CARE - 8.33%
Community Health Systems, Inc., 8.875%, Due 7/15/2015 ............. 1,000 995
DaVita, Inc., 7.25%, Due 3/15/2015 ................................ 1,000 977
Fresenius Medical Care Capital Trust IV, 7.875%, Due 6/15/2011 .... 900 918
HCA, Inc.,
9.125%, Due 11/15/2014 ++ ...................................... 2,300 2,277
6.50%, Due 2/15/2016 ........................................... 300 231
9.625%, Due 11/15/2016 # ....................................... 700 649
8.50%, Due 4/15/2019 ++ ........................................ 700 704
Health Net, Inc., 6.375%, Due 6/1/2017 ............................ 625 438
HealthSouth Corp., 8.323%, Due 6/15/2014 ss. ...................... 925 837
Tenet Healthcare Corp.,
9.875%, Due 7/1/2014 ........................................... 800 744
10.00%, Due 5/1/2018 ++ ........................................ 400 416
United Surgical Partners International, Inc., 9.25%, Due
5/1/2017 ....................................................... 1,000 745
Universal Hospital Services, Inc., 5.943%, Due 6/1/2015
ss. ............................................................ 975 748
US Oncology, Inc.,
6.904%, Due 3/15/2012 ss. ...................................... 1,005 603
10.75%, Due 8/15/2014 .......................................... 705 654
Vanguard Health Holding Co. I LLC, Zero Coupon, Due
10/1/2015 ss. .................................................. 1,050 935
Vanguard Health Holding Co. II LLC, 9.00%, Due 10/1/2014 .......... 1,000 953
-----------
13,824
-----------
HOTELS, RESTAURANTS & LEISURE - 1.83%
Denny's Holdings, Inc., 10.00%, Due 10/1/2012 ..................... 655 611
Host Hotels & Resorts LP, 6.875%, Due 11/1/2014 ................... 300 274
Host Marriott LP, 7.125%, Due 11/1/2013 ........................... 700 658
Royal Caribbean Cruises Ltd., 7.25%, Due 3/15/2018 ................ 1,000 635
See accompanying notes
18
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Starwood Hotels & Resorts Worldwide, Inc., 6.75%, Due 5/15/2018 ... $ 1,000 $ 855
-----------
3,033
-----------
INDUSTRIALS - 9.86%
AEP Industries, Inc., 7.875%, Due 3/15/2013 ....................... 565 390
Allied Waste North America, Inc.,
7.25%, Due 3/15/2015 ........................................... 450 441
7.125%, Due 5/15/2016 .......................................... 425 416
6.875%, Due 6/1/2017 ........................................... 300 291
Biomet, Inc., 10.375%, Due 10/15/2017 ............................. 1,200 1,155
Bowater, Inc., 9.00%, Due 8/1/2009 # .............................. 625 77
Case New Holland, Inc., 7.125%, Due 3/1/2014 ...................... 900 787
Casella Waste Systems, Inc., 9.75%, Due 2/1/2013 .................. 850 739
Celestica, Inc., 7.625%, Due 7/1/2013 ............................. 300 285
CEVA Group plc, 10.00%, Due 9/1/2014 ++ ........................... 800 396
Crown Americas LLC, 7.75%, Due 11/15/2015 ......................... 1,000 1,015
Freescale Semiconductor, Inc., 8.875%, Due 12/15/2014 ............. 2,650 901
Goodyear Tire & Rubber Co., 6.318%, Due 12/1/2009 ss. ............. 1,105 1,090
Intertape Polymer US, Inc., 8.50%, Due 8/1/2014 ................... 1,100 445
Johnsondiversey Holdings, Inc., 10.67%, Due 5/15/2013 ss. ......... 800 636
K Hovnanian Enterprises, Inc., 11.50%, Due 5/1/2013 ............... 612 526
Kansas City Southern de Mexico S.A. de C.V., 12.50%, Due
4/1/2016 ++ .................................................... 300 290
Masco Corp., 1.631%, Due 3/12/2010 ss. ............................ 260 248
NewPage Corp., 10.00%, Due 5/1/2012 ............................... 1,000 470
Novelis, Inc., 7.25%, Due 2/15/2015 ............................... 1,000 520
Owens-Brockway Glass Container, Inc., 6.75%, Due 12/1/2014 ........ 700 681
Owens-Illinois, Inc., 7.80%, Due 5/15/2018 ........................ 300 292
RBS Global, Inc., 9.50%, Due 8/1/2014 ............................. 1,000 817
Sanmina-SCI Corp., 8.125%, Due 3/1/2016 ........................... 1,000 505
Service Corp International, 7.00%, Due 6/15/2017 .................. 405 363
Smurfit Kappa Funding plc, 7.75%, Due 4/1/2015 .................... 100 59
Smurfit-Stone Container Enterprises, Inc., 8.375%, Due
7/1/2012 # ..................................................... 750 158
Solo Cup Co., 8.50%, Due 2/15/2014 ................................ 775 651
Stallion Oilfield Services, 9.75%, Due 2/1/2015 ++ ................ 500 98
TFM S.A.B. de C.V., 9.375%, Due 5/1/2012 .......................... 1,000 915
WCA Waste Corp., 9.25%, Due 6/15/2014 ............................. 850 689
-----------
16,346
-----------
MATERIALS - 4.80%
Freeport-McMoRan Copper & Gold, Inc., 8.375%, Due 4/1/2017 ........ 2,045 2,004
Georgia-Pacific LLC, 9.50%, Due 12/1/2011 ......................... 600 610
Huntsman International LLC,
7.875%, Due 11/15/2014 ......................................... 1,000 660
7.375%, Due 1/1/2015 ........................................... 575 374
Ineos Group Holdings plc, 8.50%, Due 2/15/2016 ++ ................. 1,100 165
MacDermid, Inc., 9.50%, Due 4/15/2017 ++ .......................... 2,200 1,089
Nalco Co., 8.875%, Due 11/15/2013 ................................. 1,000 1,005
See accompanying notes
19
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Newark Group, Inc., 9.75%, Due 3/15/2014 # ........................ $ 2,200 $ 22
Norske Skogindustrier ASA,
8.625%, Due 6/15/2011 .......................................... 1,100 611
6.125%, Due 10/15/2015 ++ ...................................... 750 394
Sappi Papier Holding AG, 7.50%, Due 6/15/2032 ++ .................. 825 311
Steel Dynamics, Inc., 8.25%, Due 4/15/2016 ++ ..................... 750 593
Tube City IMS Corp., 9.75%, Due 2/1/2015 .......................... 500 120
-----------
7,958
-----------
MEDIA - 0.36%
WMG Holdings Corp., Zero Coupon, Due 12/15/2014 ss. ............... 1,300 598
-----------
SERVICES - 1.22%
ARAMARK Corp.,
4.67%, Due 2/1/2015 ss. ........................................ 1,345 1,076
8.50%, Due 2/1/2015 ............................................ 1,000 955
-----------
2,031
-----------
TECHNOLOGY - 3.29%
First Data Corp., 9.875%, Due 9/24/2015 ........................... 2,130 1,472
Jabil Circuit, Inc., 8.25%, Due 3/15/2018 ......................... 930 767
Seagate Technology International, 10.00%, Due 5/1/2014 ++ ......... 800 788
STATS ChipPAC Ltd., 7.50%, Due 7/19/2010 .......................... 575 535
SunGard Data Systems, Inc.,
9.125%, Due 8/15/2013 .......................................... 300 286
10.25%, Due 8/15/2015 .......................................... 1,850 1,610
-----------
5,458
-----------
TELECOMMUNICATION SERVICES - 2.10%
Inmarsat Finance II plc, 10.375%, Due 11/15/2012 ss. .............. 1,800 1,845
Millicom International Cellular S.A., 10.00%, Due 12/1/2013 ....... 600 600
Wind Acquisition Finance S.A., 10.75%, Due 12/1/2015 ++ ........... 1,000 1,040
-----------
3,485
-----------
UTILITIES - 3.33%
AES Corp.,
9.375%, Due 9/15/2010 .......................................... 292 293
8.75%, Due 5/15/2013 ++ ........................................ 315 318
9.75%, Due 4/15/2016 ++ ........................................ 1,025 1,015
8.00%, Due 10/15/2017 .......................................... 900 823
Edison Mission Energy, 7.00%, Due 5/15/2017 ....................... 700 529
Elwood Energy LLC, 8.159%, Due 7/5/2026 ........................... 501 395
Energy Future Holdings Corp., 10.875%, Due 11/1/2017 .............. 150 102
Orion Power Holdings, Inc., 12.00%, Due 5/1/2010 .................. 235 246
Texas Competitive Electric Holdings Co. LLC, 10.25%, Due 11/1/2015 3,165 1,796
-----------
5,517
-----------
TOTAL CORPORATE OBLIGATIONS ....................................... 156,609
-----------
See accompanying notes
20
AMERICAN BEACON HIGH YIELD BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
CONVERTIBLE OBLIGATIONS - 0.38%
ENERGY - 0.19%
International Coal Group, Inc., 9.00%, Due 8/1/2012 ............... $ 495 $ 309
-----------
INDUSTRIALS - 0.19%
Horizon Lines, Inc., 4.25%, Due 8/15/2012 ......................... 625 323
-----------
TOTAL CONVERTIBLE OBLIGATIONS ..................................... 632
-----------
NON-AGENCY MORTGAGE-BACKED OBLIGATIONS - 0.23%
Crown Castle Towers LLC, 5.772%, Due 11/15/2036 ++ ................ 225 203
Global Signal Trust, 6.495%, Due 2/15/2036 ++ ..................... 175 181
-----------
TOTAL NON-AGENCY MORTGAGE-BACKED OBLIGATIONS ...................... 384
-----------
SHARES
------------
SHORT TERM INVESTMENTS - 5.69%
Columbia Government Reserve Fund .................................. 9,442,724 9,443
-----------
TOTAL INVESTMENTS - 100.81% (COST $196,597) .......................... $ 167,209
LIABILITIES, NET OF OTHER ASSETS - (0.81%) ........................... (1,350)
-----------
TOTAL NET ASSETS - 100.00% ........................................... $ 165,859
===========
Percentages are stated as a percent of net assets.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $38,200 or 23.03% of net
assets. The Fund has no right to demand registration of these securities.
# Non-income producing - Issuer is in default.
ss. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the final maturity date.
See accompanying notes
21
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
COMMON STOCKS - 2.85%
CONSUMER DISCRETIONARY - 0.24%
SPECIALTY RETAIL - 0.24%
NIKE, Inc. ..................................................... 3,890 $ 204
-----------
CONSUMER STAPLES - 0.21%
BEVERAGES - 0.21%
Coca-Cola Co. .................................................. 4,160 179
-----------
ENERGY - 0.74%
ENERGY EQUIPMENT & SERVICES - 0.74%
ENSCO International, Inc. ...................................... 3,800 108
Noble Corp. .................................................... 10,150 277
Transocean Ltd. ## ............................................. 3,500 236
-----------
TOTAL ENERGY ...................................................... 621
-----------
FINANCIALS - 0.41%
DIVERSIFIED FINANCIALS - 0.41%
BlackRock, Inc. ................................................ 625 92
T Rowe Price Group, Inc. ....................................... 6,500 250
-----------
TOTAL FINANCIALS .................................................. 342
-----------
HEALTH CARE - 0.18%
OPTICAL SUPPLIES - 0.18%
Alcon, Inc. .................................................... 1,630 150
-----------
INDUSTRIALS - 0.13%
AEROSPACE & DEFENSE - 0.13%
United Technologies Corp. ...................................... 2,150 105
-----------
INFORMATION TECHNOLOGY - 0.94%
COMMUNICATIONS EQUIPMENT - 0.56%
Cisco Systems, Inc. ## ......................................... 9,280 179
QUALCOMM, Inc. ................................................. 6,775 287
-----------
466
-----------
IT CONSULTING & SERVICES - 0.38%
Accenture Ltd. ................................................. 10,970 323
-----------
TOTAL INFORMATION TECHNOLOGY ...................................... 789
-----------
TOTAL COMMON STOCKS ............................................... 2,390
-----------
CONVERTIBLE PREFERRED
STOCKS - 1.40%
CONSUMER STAPLES - 0.53%
FOOD PRODUCTS - 0.53%
Bunge Ltd. ..................................................... 3,325 443
-----------
SHARES VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
FINANCIALS - 0.32%
DIVERSIFIED FINANCIALS - 0.32%
Bank of America Corp. .......................................... 475 $ 274
-----------
INDUSTRIALS - 0.20%
HOUSEHOLD DURABLES - 0.20%
Stanley Works .................................................. 255 166
-----------
MATERIALS - 0.35%
METALS & MINING - 0.35%
Freeport-McMoRan Copper & Gold, Inc. ........................... 4,360 293
-----------
TOTAL CONVERTIBLE PREFERRED STOCKS ................................ 1,176
-----------
PREFERRED STOCKS - 1.22%
CONSUMER DISCRETIONARY - 0.36%
FOOD PRODUCTS - 0.36%
Archer-Daniels-Midland Co. ..................................... 8,850 296
-----------
FINANCIALS - 0.48%
DIVERSIFIED FINANCIALS - 0.43%
Citigroup, Inc. ................................................ 11,500 364
-----------
INSURANCE - 0.05%
American International Group, Inc. ............................. 8,100 41
-----------
TOTAL FINANCIALS .................................................. 405
-----------
HEALTH CARE - 0.38%
PHARMACEUTICALS - 0.38%
Schering-Plough Corp. .......................................... 1,510 319
-----------
TOTAL PREFERRED STOCKS ............................................ 1,020
-----------
PAR
AMOUNT
------------
CORPORATE OBLIGATIONS - 31.46%
AEROSPACE & DEFENSE - 0.31%
Raytheon Co.,
5.375%, Due 4/1/2013 ........................................ $ 250 260
-----------
BANKS - 5.38%
Bank of America Corp.,
7.80%, Due 9/15/2016 ........................................ 600 413
6.00%, Due 9/1/2017 ......................................... 400 335
Bank of New York Mellon Corp.,
5.125%, Due 8/27/2013 ....................................... 350 363
Bank One Corp.,
4.90%, Due 4/30/2015 ........................................ 250 224
See accompanying notes
22
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Citigroup, Inc.,
5.125%, Due 2/14/2011 ....................................... $ 1,625 $ 1,523
6.125%, Due 11/21/2017 ...................................... 275 227
ING Bank, NV,
5.125%, Due 5/1/2015 ++ ..................................... 300 264
JP Morgan Chase & Co.,
6.00%, Due 1/15/2018 ........................................ 250 243
Wells Fargo & Co.,
5.25%, Due 10/23/2012 ....................................... 660 662
5.625%, Due 12/11/2017 ...................................... 275 256
-----------
4,510
-----------
BEVERAGES - 0.49%
Constellation Brands, Inc.,
7.25%, Due 9/1/2016 ......................................... 425 410
-----------
COMMUNICATIONS - 1.37%
Comcast Cable Communications Holdings, Inc.,
8.375%, Due 3/15/2013 ....................................... 500 551
DirecTV Holdings LLC/DirecTV Financing Co.,
8.375%, Due 3/15/2013 ....................................... 300 305
Time Warner Cable, Inc.,
5.85%, Due 5/1/2017 ......................................... 300 288
-----------
1,144
-----------
CONSUMER DISCRETIONARY - 1.39%
JC Penney Corp, Inc.,
5.75%, Due 2/15/2018 ........................................ 150 131
Royal Caribbean Cruises Ltd.,
7.50%, Due 10/15/2027 ....................................... 500 312
Wal-Mart Stores, Inc.,
7.55%, Due 2/15/2030 ........................................ 325 375
Wesco Distribution, Inc.,
7.50%, Due 10/15/2017 ....................................... 450 343
-----------
1,161
-----------
CONSUMER STAPLES - 0.91%
Coca-Cola Enterprises, Inc.,
7.375%, Due 3/3/2014 ........................................ 150 171
Hanesbrands, Inc.,
5.698%, Due 12/15/2014 # .................................... 440 337
Kellogg Co.,
4.25%, Due 3/6/2013 ......................................... 250 253
-----------
761
-----------
ENERGY - 1.28%
Canadian Natural Resources Ltd.,
6.25%, Due 3/15/2038 ........................................ 325 264
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
ConocoPhillips,
5.20%, Due 5/15/2018 ........................................ $ 325 $ 319
EOG Resources Canada, Inc.,
4.75%, Due 3/15/2014 ++ ..................................... 250 251
Hornbeck Offshore Services, Inc.,
6.125%, Due 12/1/2014 ....................................... 290 239
-----------
1,073
-----------
FINANCE - 4.39%
American General Finance Corp.,
4.875%, Due 5/15/2010 ....................................... 300 199
General Electric Capital Corp.,
5.65%, Due 6/9/2014 ......................................... 500 497
5.625%, Due 5/1/2018 ........................................ 250 218
Goldman Sachs Group, Inc.,
4.75%, Due 7/15/2013 ........................................ 250 242
6.25%, Due 9/1/2017 ......................................... 250 236
HSBC Finance Corp.,
5.25%, Due 1/14/2011 ........................................ 1,300 1,262
JP Morgan Chase & Co.,
6.75%, Due 2/1/2011 ......................................... 800 830
Merrill Lynch & Co., Inc.,
6.11%, Due 1/29/2037 ........................................ 325 190
-----------
3,674
-----------
HEALTH CARE - 0.14%
Psychiatric Solutions, Inc.,
7.75%, Due 7/15/2015 ........................................ 125 114
-----------
INDUSTRIALS - 5.35%
American Honda Finance Corp.,
4.625%, Due 4/2/2013 ++ ..................................... 325 290
BE Aerospace, Inc.,
8.50%, Due 7/1/2018 ......................................... 325 294
Burlington Northern Santa Fe Corp.,
5.75%, Due 3/15/2018 ........................................ 325 323
Canadian National Railway Co.,
5.55%, Due 5/15/2018 ........................................ 250 253
Caterpillar Financial Services Corp.,
4.15%, Due 1/15/2010 ........................................ 300 304
4.25%, Due 2/8/2013 ......................................... 250 243
Daimler Finance NA LLC,
5.875%, Due 3/15/2011 ....................................... 250 247
5.75%, Due 9/8/2011 ......................................... 250 246
Gardner Denver, Inc.,
8.00%, Due 5/1/2013 ......................................... 300 262
Goodyear Tire & Rubber Co.,
7.857%, Due 8/15/2011 ....................................... 300 279
See accompanying notes
23
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Honeywell International, Inc.,
4.25%, Due 3/1/2013 ......................................... $ 250 $ 260
Kansas City Southern Railway,
13.00%, Due 12/15/2013 ...................................... 210 223
NBTY, Inc.,
7.125%, Due 10/1/2015 ....................................... 150 135
Nissan Motor Acceptance Corp.,
5.625%, Due 3/14/2011 ++ .................................... 300 273
Norfolk Southern Corp.,
5.75%, Due 4/1/2018 ......................................... 325 320
Terex Corp.,
8.00%, Due 11/15/2017 ....................................... 125 103
Union Pacific Corp.,
6.50%, Due 4/15/2012 ........................................ 250 259
United Technologies Corp.,
6.125%, Due 7/15/2038 ....................................... 165 164
-----------
4,478
-----------
INSURANCE - 2.03%
Aegon Funding Corp.,
5.75%, Due 12/15/2020 ....................................... 350 287
American International Group, Inc.,
5.85%, Due 1/16/2018 ........................................ 250 84
6.25%, Due 5/1/2036 ......................................... 325 111
Lincoln National Corp.,
4.75%, Due 2/15/2014 ........................................ 105 67
MetLife, Inc.,
6.375%, Due 6/15/2034 ....................................... 350 269
Metropolitan Life Global Funding I,
4.625%, Due 8/19/2010 ++ .................................... 700 681
Prudential Financial, Inc.,
4.50%, Due 7/15/2013 ........................................ 250 203
-----------
1,702
-----------
INTERNET & CATALOG RETAIL - 0.32%
Expedia, Inc.,
7.456%, Due 8/15/2018 ....................................... 300 271
-----------
PHARMACEUTICALS - 0.56%
Bristol-Myers Squibb Co.,
5.45%, Due 5/1/2018 ......................................... 125 128
GlaxoSmithKline Capital, Inc.,
5.65%, Due 5/15/2018 ........................................ 125 130
Pfizer, Inc.,
5.35%, Due 3/15/2015 ........................................ 200 215
-----------
473
-----------
REAL ESTATE - 0.79%
ProLogis,
5.50%, Due 4/1/2012 ......................................... 250 203
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
5.625%, Due 11/15/2016 ...................................... $ 250 $ 168
Simon Property Group LP,
5.30%, Due 5/30/2013 ........................................ 325 290
-----------
661
-----------
TECHNOLOGY - 2.74%
Cisco Systems, Inc.,
5.25%, Due 2/22/2011 ........................................ 250 266
Hewlett-Packard Co.,
4.50%, Due 3/1/2013 ......................................... 325 337
International Business Machines Corp.,
7.625%, Due 10/15/2018 ...................................... 150 178
Jabil Circuit, Inc.,
8.25%, Due 3/15/2018 ........................................ 325 268
Lender Processing Services, Inc.,
8.125%, Due 7/1/2016 ........................................ 325 322
Seagate Technology,
6.80%, Due 10/1/2016 ........................................ 350 252
SunGard Data Systems, Inc.,
9.125%, Due 8/15/2013 ....................................... 300 286
Syniverse Technologies, Inc.,
7.75%, Due 8/15/2013 ........................................ 325 276
Xerox Corp.,
5.65%, Due 5/15/2013 ........................................ 125 113
-----------
2,298
-----------
TELEPHONE - 2.84%
America Movil, S.A.B. de C.V.,
6.375%, Due 3/1/2035 ........................................ 325 262
AT&T Wireless Services, Inc.,
7.875%, Due 3/1/2011 ........................................ 250 271
AT&T, Inc.,
5.625%, Due 6/15/2016 ....................................... 250 255
5.50%, Due 2/1/2018 ......................................... 400 399
6.80%, Due 5/15/2036 ........................................ 125 121
6.40%, Due 5/15/2038 ........................................ 200 188
Verizon Communications, Inc.,
5.50%, Due 4/1/2017 ......................................... 250 249
6.90%, Due 4/15/2038 ........................................ 325 321
Vodafone Group plc,
6.15%, Due 2/27/2037 ........................................ 325 314
-----------
2,380
-----------
UTILITIES - 1.17%
Duke Energy Carolinas LLC,
5.10%, Due 4/15/2018 ........................................ 250 254
MidAmerican Energy Holdings Co.,
6.125%, Due 4/1/2036 ........................................ 325 282
Pacific Gas & Electric Co.,
6.25%, Due 12/1/2013 ........................................ 175 190
See accompanying notes
24
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Virginia Electric and Power Co.,
5.40%, Due 4/30/2018 ........................................ $ 250 $ 255
-----------
981
-----------
TOTAL CORPORATE OBLIGATIONS ....................................... 26,351
-----------
CONVERTIBLE OBLIGATIONS - 13.61%
BASIC MATERIALS - 0.79%
Newmont Mining Corp.,
3.00%, Due 2/15/2012 ........................................ 50 60
1.25%, Due 7/15/2014 ........................................ 325 364
1.625%, Due 7/15/2017 ....................................... 220 239
-----------
663
-----------
COMMUNICATIONS - 1.88%
Anixter International, Inc.,
1.00%, Due 2/15/2013 ........................................ 400 336
Interpublic Group of Cos., Inc.,
4.25%, Due 3/15/2023 ........................................ 240 216
Symantec Corp.,
1.00%, Due 6/15/2013 ........................................ 750 806
VeriSign, Inc.,
3.25%, Due 8/15/2037 ........................................ 300 217
-----------
1,575
-----------
CONSUMER DISCRETIONARY - 0.93%
Archer-Daniels-Midland Co.,
0.875%, Due 2/15/2014 ....................................... 280 257
Best Buy Co., Inc.,
2.25%, Due 1/15/2022 ........................................ 200 199
BorgWarner, Inc.,
3.50%, Due 4/15/2012 ........................................ 80 92
GameStop Corp.,
8.00%, Due 10/1/2012 ........................................ 225 228
-----------
776
-----------
CONSUMER STAPLES - 0.27%
Kinetic Concepts, Inc.,
3.25%, Due 4/15/2015 ++ ..................................... 310 231
-----------
ENERGY - 1.07%
Cameron International Corp.,
2.50%, Due 6/15/2026 ........................................ 190 207
2.50%, Due 5/15/2037 ........................................ 570 413
Schlumberger Ltd.,
2.125%, Due 6/1/2023 ........................................ 40 55
SESI LLC,
1.50%, Due 12/15/2026 ....................................... 270 220
-----------
895
-----------
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
FINANCE - 0.68%
Affiliated Managers Group, Inc.,
3.95%, Due 8/15/2038 ++ ..................................... $ 370 $ 295
Leucadia National Corp.,
3.75%, Due 4/15/2014 ........................................ 250 275
-----------
570
-----------
HEALTH CARE - 0.78%
Gilead Sciences, Inc.,
0.50%, Due 5/1/2011 ......................................... 360 455
Henry Schein, Inc.,
3.00%, Due 8/15/2034 ........................................ 100 108
Hologic, Inc.,
2.00%, Due 12/15/2037 ....................................... 130 92
-----------
655
-----------
INDUSTRIAL - 0.07%
Ingersoll-Rand Co Ltd.,
4.50%, Due 4/15/2012 ........................................ 40 56
-----------
INDUSTRIALS - 1.53%
Alliant Techsystems, Inc.,
2.75%, Due 9/15/2011 ........................................ 320 326
Danaher Corp.,
Zero Coupon, Due 1/22/2021 .................................. 370 332
Fisher Scientific International, Inc.,
3.25%, Due 3/1/2024 ......................................... 230 269
SEACOR Holdings, Inc.,
2.875%, Due 12/15/2024 ...................................... 210 214
Trinity Industries, Inc.,
3.875%, Due 6/1/2036 ........................................ 250 139
-----------
1,280
-----------
PHARMACEUTICALS - 2.14%
Amgen, Inc.,
0.375%, Due 2/1/2013 ........................................ 675 610
Beckman Coulter, Inc.,
2.50%, Due 12/15/2036 ....................................... 213 215
Life Technologies Corp.,
1.50%, Due 2/15/2024 ........................................ 246 233
Mylan, Inc.,
1.25%, Due 3/15/2012 ........................................ 480 424
Teva Pharmaceutical Finance LLC,
0.25%, Due 2/1/2026 ......................................... 295 308
-----------
1,790
-----------
TECHNOLOGY - 3.47%
Apogent Technologies, Inc.,
0.07%, Due 12/15/2033 # ..................................... 100 120
See accompanying notes
25
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
CACI International, Inc.,
2.125%, Due 5/1/2014 ........................................ $ 230 $ 209
DST Systems, Inc.,
4.125%, Due 8/15/2023 ....................................... 220 216
EMC Corp.,
1.75%, Due 12/1/2013 ........................................ 865 889
Intel Corp.,
2.95%, Due 12/15/2035 ....................................... 255 218
NetApp, Inc.,
1.75%, Due 6/1/2013 ++ ...................................... 775 689
Sybase, Inc.,
1.75%, Due 2/22/2025 ........................................ 405 565
-----------
2,906
-----------
TOTAL CONVERTIBLE OBLIGATIONS ..................................... 11,397
-----------
NON-AGENCY MORTGAGE-BACKED
OBLIGATIONS - 2.91%
COMMERCIAL MORTGAGE-BACKED SECURITY - 2.91%
Banc of America Commercial Mortgage, Inc.,
2005-6 A1, 5.001%, Due 9/10/2047 ............................ 389 388
2007-2 A2, 5.634%, Due 4/10/2049 ............................ 650 556
JP Morgan Chase Commercial Mortgage
Securities Corp.,
2005-LDP3 A1, 4.655%, Due 8/15/2042 ......................... 100 99
2007-CB19 A4, 5.937%, Due 2/12/2049 ......................... 400 285
2007-CB20 A2, 5.629%, Due 2/12/2051 ......................... 650 556
LB-UBS Commercial Mortgage Trust,
2004-C1 A4, 5.424%, Due 2/15/2040 ........................... 450 325
Wachovia Bank Commercial Mortgage Trust,
2007-C32 A2, 5.924%, Due 6/15/2049 .......................... 260 224
-----------
TOTAL NON-AGENCY MORTGAGE-BACKED OBLIGATIONS ...................... 2,433
-----------
ASSET-BACKED SECURITIES - 3.58%
American Express Credit Account Master Trust,
2006-2 A, 5.35%, Due 1/15/2014 .............................. 1,300 1,307
Capital Auto Receivables Asset Trust,
2006-SN1A A4A, 5.32%, Due 3/20/2010 ++ ...................... 385 384
Capital One Multi-Asset Execution Trust,
2006-A10 A10, 5.15%, Due 6/16/2014 .......................... 1,000 998
Volkswagen Auto Loan Enhanced Trust,
2008-2 A4A, 6.24%, Due 7/20/2015 ............................ 300 308
-----------
TOTAL ASSET-BACKED SECURITIES ..................................... 2,997
-----------
U.S. AGENCY MORTGAGE-BACKED
OBLIGATIONS - 23.17%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 9.81%
5.00%, Due 2/1/2021 ......................................... 1,025 1,064
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
4.50%, Due 4/1/2021 ......................................... $ 986 $ 1,014
5.00%, Due 9/1/2035 ......................................... 2,221 2,287
5.50%, Due 4/1/2037 ......................................... 752 779
5.00%, Due 3/1/2038 ......................................... 1,509 1,553
5.50%, Due 5/1/2038 ......................................... 1,465 1,517
-----------
8,214
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 9.47%
6.50%, Due 7/1/2032 ......................................... 382 410
5.50%, Due 6/1/2033 ......................................... 875 911
4.50%, Due 9/1/2034 ......................................... 417 425
5.50%, Due 12/1/2035 ........................................ 913 949
5.00%, Due 2/1/2036 ......................................... 750 774
5.50%, Due 4/1/2036 ......................................... 1,398 1,452
5.50%, Due 2/1/2037 ......................................... 1,127 1,169
6.00%, Due 9/1/2037 ......................................... 765 800
6.00%, Due 1/1/2038 ......................................... 999 1,046
-----------
7,936
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 3.89%
4.201%, Due 8/16/2026 ....................................... 468 476
6.00%, Due 2/15/2033 ........................................ 815 852
5.50%, Due 4/15/2033 ........................................ 1,086 1,132
5.00%, Due 5/15/2033 ........................................ 768 797
-----------
3,257
-----------
TOTAL U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS ..................... 19,407
-----------
U.S. AGENCY OBLIGATIONS - 1.16%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 1.16%
6.25%, Due 7/15/2032 ........................................ 800 974
-----------
U.S. TREASURY OBLIGATIONS - 11.36%
1.375%, Due 3/15/2012 ....................................... 2,000 2,004
4.125%, Due 5/15/2015 ....................................... 2,500 2,758
3.75%, Due 11/15/2018 + ..................................... 1,000 1,051
6.25%, Due 8/15/2023 ........................................ 1,500 1,875
5.25%, Due 11/15/2028 ....................................... 1,050 1,211
4.75%, Due 2/15/2037 ........................................ 550 611
-----------
TOTAL U.S. TREASURY OBLIGATIONS ...................................... 9,510
-----------
SHARES
------------
SHORT TERM INVESTMENTS - 6.56%
Columbia Government Reserve Fund .................................. 5,495,956 5,496
-----------
SECURITIES LENDING
COLLATERAL - 1.30%
American Beacon U.S. Government Money Market Select Fund ss. ...... 234,539 234
See accompanying notes
26
AMERICAN BEACON ENHANCED INCOME FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
State Street Navigator Securities Lending Prime Portfolio ...... $ 857,961 $ 858
-----------
TOTAL SECURITIES LENDING COLLATERAL ............................... 1,092
-----------
TOTAL INVESTMENTS 100.58% - (COST $87,912) ........................... 84,243
LIABILITIES, NET OF OTHER ASSETS - (0.58%) ........................... (488)
-----------
TOTAL NET ASSETS - 100.00% ........................................... $ 83,755
===========
Percentages are stated as a percent of net assets.
## Non-income producing security.
+ All or a portion of this security is on loan at April 30, 2009.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $3,358 or 4.01% of net
assets. The Fund has no right to demand registration of these securities.
# The coupon rate shown on floating or adjustable rate securities represents
the rate at period end. The due date on these types of securities reflects
the final maturity date.
ss. The Fund is affiliated by having the same investment advisor.
See accompanying notes
27
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
CORPORATE OBLIGATIONS - 26.11%
AEROSPACE & DEFENSE - 0.09%
Raytheon Co., 5.375%, Due 4/1/2013 ................................ $ 200 $ 208
-----------
BANKS - 3.15%
Bank of America Corp.,
7.80%, Due 9/15/2016 ........................................... 500 344
6.00%, Due 9/1/2017 ............................................ 200 167
5.75%, Due 12/1/2017 ........................................... 960 784
Bank of New York Mellon Corp.,
4.95%, Due 11/1/2012 ........................................... 140 145
5.125%, Due 8/27/2013 .......................................... 250 259
Bank One Corp.,
5.90%, Due 11/15/2011 .......................................... 940 954
4.90%, Due 4/30/2015 + ......................................... 200 180
BP Capital Markets plc, 3.125%, Due 3/10/2012 ..................... 520 528
Citigroup, Inc.,
5.125%, Due 2/14/2011 .......................................... 1,200 1,124
6.125%, Due 11/21/2017 ......................................... 555 458
ING Bank, NV, 5.125%, Due 5/1/2015 ++ ............................. 250 220
JP Morgan Chase & Co.,
6.75%, Due 2/1/2011 ............................................ 625 648
6.00%, Due 1/15/2018 ........................................... 250 243
Wachovia Corp., 5.70%, Due 8/1/2013 ............................... 100 98
Washington Mutual Finance Corp., 6.875%, Due 5/15/2011 ............ 230 210
Wells Fargo & Co.,
5.25%, Due 10/23/2012 .......................................... 500 502
5.625%, Due 12/11/2017 ......................................... 200 186
-----------
7,050
-----------
BASIC MATERIALS - 0.43%
ArcelorMittal, 6.125%, Due 6/1/2018 ............................... 340 274
EI Du Pont de Nemours & Co., 5.875%, Due 1/15/2014 ................ 395 421
Lubrizol Corp., 8.875%, Due 2/1/2019 .............................. 255 277
-----------
972
-----------
COMMUNICATIONS - 2.33%
Alltel Corp., 7.00%, Due 7/1/2012 ................................. 215 227
British Telecommunications plc, 8.625%, Due 12/15/2010 # .......... 645 674
Comcast Cable Communications Holdings, Inc., 8.375%, Due 3/15/2013 650 717
Comcast Corp.,
5.30%, Due 1/15/2014 ........................................... 555 560
5.875%, Due 2/15/2018 .......................................... 235 233
Nokia Corp., 5.375%, Due 5/15/2019 ................................ 650 644
Rogers Communications, Inc., 6.80%, Due 8/15/2018 ................. 250 262
Time Warner Cable, Inc.,
8.25%, Due 2/14/2014 ........................................... 330 362
See accompanying notes
28
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
5.85%, Due 5/1/2017 ............................................ $ 730 $ 702
Verizon Wireless Capital, LLC, 8.50%, Due 11/15/2018 ++ ........... 700 838
-----------
5,219
-----------
CONSUMER DISCRETIONARY - 0.76%
Best Buy Co., Inc., 6.75%, Due 7/15/2013 .......................... 240 237
Lowe's Companies, Inc.,
5.50%, Due 10/15/2035 .......................................... 300 245
6.65%, Due 9/15/2037 ........................................... 130 130
Walgreen Co., 5.25%, Due 1/15/2019 ................................ 275 274
Wal-Mart Stores, Inc.,
7.55%, Due 2/15/2030 ........................................... 250 288
6.20%, Due 4/15/2038 ........................................... 495 515
-----------
1,689
-----------
CONSUMER STAPLES - 0.96%
Altria Group, Inc., 9.70%, Due 11/10/2018 ......................... 375 438
Archer-Daniels-Midland Co., 6.45%, Due 1/15/2038 .................. 140 142
Coca-Cola Enterprises, Inc., 7.375%, Due 3/3/2014 ................. 175 200
Dr Pepper Snapple Group, Inc., 6.82%, Due 5/1/2018 ................ 140 136
Kellogg Co., 4.25%, Due 3/6/2013 .................................. 250 253
Kraft Foods, Inc.,
6.75%, Due 2/19/2014 ........................................... 250 273
6.50%, Due 8/11/2017 ........................................... 290 301
Kroger Co., 7.50%, Due 1/15/2014 .................................. 220 245
Safeway, Inc., 6.25%, Due 3/15/2014 ............................... 140 149
-----------
2,137
-----------
ENERGY - 1.83%
Cameron International Corp., 6.375%, Due 7/15/2018 ................ 125 110
Canadian Natural Resources Ltd.,
6.70%, Due 7/15/2011 ........................................... 400 415
6.25%, Due 3/15/2038 ........................................... 250 203
ConocoPhillips,
5.20%, Due 5/15/2018 ........................................... 250 245
5.75%, Due 2/1/2019 ............................................ 380 388
Consolidated Natural Gas Co., 6.00%, Due 10/15/2010 ............... 175 181
Energy Transfer Partners LP,
8.50%, Due 4/15/2014 ........................................... 340 367
9.00%, Due 4/15/2019 ........................................... 300 327
EOG Resources Canada, Inc., 4.75%, Due 3/15/2014 ++ ............... 200 201
Marathon Oil Corp., 6.00%, Due 10/1/2017 .......................... 275 262
Shell International Finance BV, 6.375%, Due 12/15/2038 ............ 450 479
TransCanada Pipelines Ltd., 7.625%, Due 1/15/2039 ................. 520 569
Valero Energy Corp.,
9.375%, Due 3/15/2019 .......................................... 170 190
6.625%, Due 6/15/2037 .......................................... 205 162
-----------
4,099
-----------
See accompanying notes
29
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
FINANCE - 3.55%
American Express Co., 8.15%, Due 3/19/2038 ........................ $ 325 $ 308
American Express Credit Corp., 5.875%, Due 5/2/2013 ............... 495 488
American General Finance Corp.,
4.875%, Due 5/15/2010 .......................................... 200 133
4.00%, Due 3/15/2011 ........................................... 430 218
Ameriprise Financial, Inc., 5.35%, Due 11/15/2010 ................. 930 917
Bear Stearns Cos., Inc.,
6.40%, Due 10/2/2017 ........................................... 605 589
7.25%, Due 2/1/2018 ............................................ 270 276
CIT Group, Inc., 4.75%, Due 12/15/2010 ............................ 265 196
CME Group, Inc., 5.40%, Due 8/1/2013 .............................. 370 383
Countrywide Home Loans, Inc., 4.00%, Due 3/22/2011 ................ 70 66
General Electric Capital Corp.,
4.375%, Due 3/3/2012 ........................................... 350 342
5.65%, Due 6/9/2014 ............................................ 450 447
5.625%, Due 5/1/2018 ........................................... 250 218
6.875%, Due 1/10/2039 .......................................... 370 290
Goldman Sachs Group, Inc.,
4.75%, Due 7/15/2013 ........................................... 300 291
6.25%, Due 9/1/2017 ............................................ 200 189
5.95%, Due 1/18/2018 ........................................... 215 199
6.75%, Due 10/1/2037 ........................................... 245 187
HSBC Finance Corp., 5.25%, Due 1/14/2011 .......................... 1,000 970
International Lease Finance Corp., 5.75%, Due 6/15/2011 ........... 240 183
Merrill Lynch & Co., Inc.,
5.45%, Due 2/5/2013 ............................................ 145 127
6.875%, Due 4/25/2018 .......................................... 305 257
6.11%, Due 1/29/2037 ........................................... 250 146
Novartis Capital Corp., 4.125%, Due 2/10/2014 ..................... 395 409
SLM Corp., 5.375%, Due 1/15/2013 .................................. 170 114
-----------
7,943
-----------
HEALTH CARE - 0.71%
Amgen, Inc., 6.40%, Due 2/1/2039 .................................. 445 448
Covidien International Finance SA, 5.45%, Due 10/15/2012 .......... 120 124
UnitedHealth Group, Inc., 5.25%, Due 3/15/2011 .................... 1,010 1,026
-----------
1,598
-----------
INDUSTRIALS - 3.11%
American Honda Finance Corp., 4.625%, Due 4/2/2013 ++ ............. 250 223
Burlington Northern Santa Fe Corp., 5.75%, Due 3/15/2018 .......... 250 249
Canadian National Railway Co.,
5.55%, Due 5/15/2018 ........................................... 250 253
5.55%, Due 3/1/2019 ............................................ 165 168
Caterpillar Financial Services Corp.,
4.15%, Due 1/15/2010 ........................................... 200 203
See accompanying notes
30
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Caterpillar Financial Services Corp.,
4.85%, Due 12/7/2012 ........................................... $ 195 $ 194
4.25%, Due 2/8/2013 ............................................ 250 243
CRH America, Inc., 6.00%, Due 9/30/2016 ........................... 370 289
Daimler Finance NA LLC,
5.875%, Due 3/15/2011 .......................................... 300 297
5.75%, Due 9/8/2011 ............................................ 200 197
Eaton Corp., 5.60%, Due 5/15/2018 ................................. 195 182
Home Depot, Inc., 5.20%, Due 3/1/2011 ............................. 485 494
Honeywell International, Inc., 4.25%, Due 3/1/2013 ................ 250 260
ITT Corp., 4.90%, Due 5/1/2014 .................................... 940 953
John Deere Capital Corp.,
4.125%, Due 1/15/2010 .......................................... 675 683
5.40%, Due 10/17/2011 .......................................... 480 498
Koninklijke Philips Electronics NV, 5.75%, Due 3/11/2018 .......... 165 165
Nissan Motor Acceptance Corp., 5.625%, Due 3/14/2011 ++ ........... 200 182
Norfolk Southern Corp., 5.75%, Due 4/1/2018 ....................... 250 246
Tyco Electronics Group SA, 6.55%, Due 10/1/2017 ................... 225 173
Tyco International Finance SA, 8.50%, Due 1/15/2019 ............... 185 198
Union Pacific Corp., 6.50%, Due 4/15/2012 ......................... 200 207
United Technologies Corp., 6.125%, Due 7/15/2038 .................. 125 124
Waste Management, Inc., 7.375%, Due 3/11/2019 ..................... 270 274
-----------
6,955
-----------
INSURANCE - 1.13%
Aegon Funding Corp., 5.75%, Due 12/15/2020 ........................ 200 164
American International Group, Inc.,
5.85%, Due 1/16/2018 ........................................... 200 67
6.25%, Due 5/1/2036 ............................................ 250 85
John Hancock Global Funding II, 7.90%, Due 7/2/2010 ++ ............ 700 716
Lincoln National Corp., 4.75%, Due 2/15/2014 ...................... 50 32
MetLife, Inc.,
5.375%, Due 12/15/2012 ......................................... 240 228
6.375%, Due 6/15/2034 .......................................... 200 154
Metropolitan Life Global Funding I, 4.625%, Due 8/19/2010 ++ ...... 500 486
Prudential Financial, Inc.,
4.50%, Due 7/15/2013 ........................................... 200 163
5.10%, Due 9/20/2014 ........................................... 280 222
Willis North America, Inc., 6.20%, Due 3/28/2017 .................. 280 203
-----------
2,520
-----------
PHARMACEUTICALS - 1.36%
Bristol-Myers Squibb Co., 5.45%, Due 5/1/2018 ..................... 125 128
GlaxoSmithKline Capital, Inc.,
5.65%, Due 5/15/2018 ........................................... 125 130
6.375%, Due 5/15/2038 .......................................... 325 335
Hospira, Inc., 6.05%, Due 3/30/2017 ............................... 205 184
See accompanying notes
31
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Pfizer, Inc.,
4.45%, Due 3/15/2012 ........................................... $ 845 $ 888
5.35%, Due 3/15/2015 ........................................... 380 408
Wyeth Corp., 5.50%, Due 2/1/2014 .................................. 900 966
-----------
3,039
-----------
REAL ESTATE - 0.55%
Equity Residential, 5.125%, Due 3/15/2016 ......................... 380 313
ProLogis,
5.50%, Due 4/1/2012 ............................................ 300 244
5.625%, Due 11/15/2016 ......................................... 200 134
Simon Property Group LP,
5.30%, Due 5/30/2013 ........................................... 250 223
5.75%, Due 12/1/2015 ........................................... 370 304
-----------
1,218
-----------
TECHNOLOGY - 1.91%
Cisco Systems, Inc., 5.25%, Due 2/22/2011 ......................... 200 213
Computer Sciences Corp.,
5.50%, Due 3/15/2013 ........................................... 220 218
6.50%, Due 3/15/2018 ........................................... 505 493
Hewlett-Packard Co.,
4.25%, Due 2/24/2012 ........................................... 625 648
4.50%, Due 3/1/2013 ............................................ 250 259
6.125%, Due 3/1/2014 ........................................... 510 561
International Business Machines Corp., 7.625%, Due 10/15/2018 ..... 750 889
United Technologies Corp., 6.125%, Due 2/1/2019 ................... 820 883
Xerox Corp., 5.65%, Due 5/15/2013 ................................. 125 113
-----------
4,277
-----------
TELEPHONE - 1.95%
America Movil, S.A.B. de C.V., 6.375%, Due 3/1/2035 ............... 250 202
AT&T Wireless Services, Inc.,
7.875%, Due 3/1/2011 ........................................... 200 217
8.75%, Due 3/1/2031 ............................................ 435 498
AT&T, Inc.,
5.10%, Due 9/15/2014 ........................................... 1,155 1,200
5.625%, Due 6/15/2016 .......................................... 200 204
5.50%, Due 2/1/2018 ............................................ 300 299
6.80%, Due 5/15/2036 ........................................... 125 121
6.40%, Due 5/15/2038 ........................................... 125 117
Deutsche Telekom AG, 8.50%, Due 6/15/2010 ......................... 450 473
Telefonica Emisiones SAU, 5.984%, Due 6/20/2011 ................... 285 297
Verizon Communications, Inc.,
5.50%, Due 4/1/2017 ............................................ 250 249
6.90%, Due 4/15/2038 ........................................... 250 247
Vodafone Group plc, 6.15%, Due 2/27/2037 .......................... 250 242
-----------
4,366
-----------
See accompanying notes
32
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
UTILITIES - 2.29%
Columbus Southern Power Co., 5.50%, Due 3/1/2013 .................. $ 495 $ 501
Dominion Resources, Inc.,
Series A, 5.60%, Due 11/15/2016 ................................ 475 466
8.875%, Due 1/15/2019 .......................................... 80 93
Duke Energy Carolinas LLC, 5.10%, Due 4/15/2018 ................... 250 254
Duke Energy Indiana, Inc., 6.05%, Due 6/15/2016 ................... 355 362
MidAmerican Energy Holdings Co.,
5.875%, Due 10/1/2012 .......................................... 405 418
6.125%, Due 4/1/2036 ........................................... 250 217
Pacific Gas & Electric Co., 6.25%, Due 12/1/2013 .................. 150 163
Public Service Enterprise Group, Inc., 6.95%, Due 6/1/2012 ........ 590 604
Southern Power Co., 6.25%, Due 7/15/2012 .......................... 450 466
Union Electric Co., 6.70%, Due 2/1/2019 ........................... 370 364
Virginia Electric and Power Co., 5.40%, Due 4/30/2018 ............. 250 255
Westar Energy, Inc., 6.00%, Due 7/1/2014 .......................... 200 200
Wisconsin Electric Power Co., 6.25%, Due 12/1/2015 ................ 200 211
Xcel Energy, Inc., 5.613%, Due 4/1/2017 ........................... 581 554
-----------
5,128
-----------
TOTAL CORPORATE OBLIGATIONS ....................................... 58,418
-----------
NON-AGENCY MORTGAGE-BACKED OBLIGATIONS - 4.62%
Banc of America Commercial Mortgage, Inc.,
2005-6 A1, 5.001%, Due 9/10/2047 ............................... 195 194
2007-2 A2, 5.634%, Due 4/10/2049 ............................... 450 385
Bear Stearns Commercial Mortgage Securities, Inc.,
2006-T22 A2, 5.63%, Due 4/12/2038 .............................. 830 775
2004-PWR5 A4, 4.831%, Due 7/11/2042 ............................ 835 736
2005-T20 A2, 5.127%, Due 10/12/2042 ............................ 430 415
Chase Mortgage Finance Corp., 2006-A1 A1, 6.037%, Due 9/25/2036
ss. ............................................................ 900 690
Citicorp Mortgage Securities, Inc., 2006-3 2A1, 5.50%, Due
6/25/2021 ...................................................... 422 372
Citigroup Commercial Mortgage Trust, 2004-C2 A3, 4.38%, Due
10/15/2041 ..................................................... 770 698
Citigroup/Deutsche Bank Commercial Mortgage Trust, 2007-CD5 A4,
5.886%, Due 11/15/2044 ......................................... 840 655
Countrywide Home Loan Mortgage Pass Through Trust, 2007-18 A1,
6.00%, Due 9/25/2037 ........................................... 764 516
GE Capital Commercial Mortgage Corp., 2003-C2 A2, 4.17%, Due
7/10/2037 ...................................................... 138 136
JP Morgan Chase Commercial Mortgage Securities Corp.,
2004-CBX A4, 4.529%, Due 1/12/2037 ............................. 255 223
2005-LDP3 A1, 4.655%, Due 8/15/2042 ............................ 57 57
2005-LDP1 A2, 4.625%, Due 3/15/2046 ............................ 784 759
2006-LDP9 A3, 5.336%, Due 5/15/2047 ............................ 695 537
2007-CB19 A4, 5.937%, Due 2/12/2049 ............................ 300 214
2007-CB20 A2, 5.629%, Due 2/12/2051 ............................ 500 428
JP Morgan Mortgage Trust, 2007-S3 1A90, 7.00%, Due 8/25/2037 ...... 454 295
LB-UBS Commercial Mortgage Trust, 2004-C1 A4, 5.424%, Due
2/15/2040 ...................................................... 400 288
Morgan Stanley Capital I, 2007-IQ14 A4, 5.692%, Due 4/15/2049 ..... 910 621
See accompanying notes
33
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
Prime Mortgage Trust, 2005-2, 5.25%, Due 7/25/2020 ................ $ 515 $ 517
Wachovia Bank Commercial Mortgage Trust, 2007-C32 A2, 5.924%, Due
6/15/2049 ...................................................... 210 181
Wells Fargo Mortgage Backed Securities Trust,
2006-11 A8, 6.00%, Due 9/25/2036 ............................... 487 387
2007-7 A1, 6.00%, Due 6/25/2037 ................................ 456 267
-----------
TOTAL NON-AGENCY MORTGAGE-BACKED OBLIGATIONS ...................... 10,346
-----------
ASSET-BACKED SECURITIES - 1.04%
American Express Credit Account Master Trust, 2006-2 A, 5.35%, Due
1/15/2014 ...................................................... 1,000 1,005
Capital Auto Receivables Asset Trust, 2006-SN1A A4A, 5.32%, Due
3/20/2010 ++ ................................................... 257 256
Capital One Multi-Asset Execution Trust, 2006-A10 A10, 5.15%, Due
6/16/2014 ...................................................... 750 749
Volkswagen Auto Loan Enhanced Trust, 2008-2 A4A, 6.24%, Due
7/20/2015 ...................................................... 300 308
-----------
TOTAL ASSET-BACKED SECURITIES ..................................... 2,318
-----------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS - 34.60%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 9.09%
4.50%, Due 3/1/2019 ............................................ 477 493
5.00%, Due 10/1/2020 ........................................... 1,164 1,207
5.50%, Due 12/1/2022 ........................................... 160 166
5.00%, Due 4/1/2023 ............................................ 410 425
5.50%, Due 1/1/2024 ............................................ 751 781
5.00%, Due 8/1/2033 ............................................ 669 689
5.50%, Due 2/1/2034 ............................................ 907 942
6.00%, Due 8/1/2034 ............................................ 416 437
5.00%, Due 8/1/2035 ............................................ 447 461
5.00%, Due 9/1/2035 ............................................ 644 664
5.00%, Due 9/1/2035 ............................................ 1,111 1,144
6.00%, Due 8/1/2036 ............................................ 897 938
5.50%, Due 11/1/2036 ........................................... 646 669
5.50%, Due 4/1/2037 ............................................ 1,504 1,557
5.50%, Due 5/1/2037 ............................................ 455 471
6.00%, Due 9/1/2037 ............................................ 315 329
6.00%, Due 12/1/2037 ........................................... 371 389
5.00%, Due 3/1/2038 ............................................ 2,137 2,198
6.00%, Due 3/1/2038 ............................................ 3,073 3,210
5.00%, Due 3/1/2038 ............................................ 1,110 1,142
5.50%, Due 5/1/2038 ............................................ 1,077 1,115
5.50%, Due 6/1/2038 ............................................ 876 907
-----------
20,334
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 24.77%
6.50%, Due 2/1/2017 ............................................ 192 203
5.00%, Due 12/1/2017 ........................................... 688 718
4.50%, Due 9/1/2018 ............................................ 1,252 1,296
4.00%, Due 8/1/2020 ............................................ 379 385
5.50%, Due 5/1/2023 ............................................ 61 63
See accompanying notes
34
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
5.00%, Due 12/1/2023 ........................................... $ 700 $ 725
5.00%, Due 3/1/2024 ............................................ 1,950 2,020
5.00%, Due 3/1/2034 ............................................ 842 869
5.50%, Due 6/1/2034 ............................................ 452 470
4.50%, Due 9/1/2034 ............................................ 278 284
5.50%, Due 2/1/2035 ............................................ 1,005 1,046
5.00%, Due 11/1/2035 ........................................... 1,495 1,541
5.50%, Due 12/1/2035 ........................................... 703 730
5.50%, Due 12/1/2035 ........................................... 384 399
5.50%, Due 1/1/2036 ............................................ 623 647
5.50%, Due 1/1/2036 ............................................ 979 1,017
5.50%, Due 2/1/2036 ............................................ 756 785
5.00%, Due 2/1/2036 ............................................ 750 774
5.00%, Due 3/1/2036 ............................................ 696 717
5.50%, Due 4/1/2036 ............................................ 1,748 1,816
6.00%, Due 9/1/2036 ............................................ 395 414
6.50%, Due 9/1/2036 ............................................ 1,456 1,547
5.50%, Due 11/1/2036 ........................................... 599 621
6.00%, Due 11/1/2036 ........................................... 710 743
6.50%, Due 12/1/2036 ........................................... 670 711
6.00%, Due 12/1/2036 ........................................... 644 674
5.50%, Due 2/1/2037 ............................................ 1,127 1,169
5.50%, Due 8/1/2037 ............................................ 2,388 2,482
6.00%, Due 8/1/2037 ............................................ 748 783
6.50%, Due 8/1/2037 ............................................ 1,009 1,070
6.00%, Due 9/1/2037 ............................................ 1,147 1,201
6.00%, Due 11/1/2037 ........................................... 1,295 1,355
6.00%, Due 1/1/2038 ............................................ 1,599 1,673
5.50%, Due 3/1/2038 ............................................ 7,092 7,354
5.00%, Due 3/1/2038 ............................................ 167 172
5.00%, Due 4/1/2038 ............................................ 910 937
5.00%, Due 4/1/2038 ............................................ 6,941 7,146
5.00%, Due 5/1/2038 ............................................ 3,903 4,018
5.50%, Due 6/1/2038 ............................................ 867 899
5.00%, Due 6/1/2038 ............................................ 1,154 1,188
5.50%, Due 6/1/2038 ............................................ 2,651 2,749
-----------
55,411
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 0.74%
4.201%, Due 8/16/2026 .......................................... 268 272
6.50%, Due 3/15/2028 ........................................... 372 398
6.00%, Due 4/15/2031 ........................................... 442 463
See accompanying notes
35
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
5.50%, Due 2/20/2034 ........................................... $ 506 $ 526
-----------
1,659
-----------
TOTAL U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS ..................... 77,404
-----------
U.S. AGENCY OBLIGATIONS - 15.85%
FDIC GUARANTEED - 5.84%
Citibank NA (FDIC Guaranteed), 1.625%, Due 3/30/2011 ........... 5,000 5,026
Morgan Stanley (FDIC Due Guaranteed), 2.25%, 3/13/2012 ......... 5,000 5,027
Bank of America Corp. (FDIC Guaranteed), 2.10%, Due 4/30/2012 .. 3,000 3,019
-----------
13,072
-----------
FEDERAL HOME LOAN BANK - 1.65%
4.50%, Due 9/16/2013 + ......................................... 3,400 3,694
-----------
FEDERAL HOME LOAN MORTGAGE CORPORATION - 5.01%
1.50%, Due 1/7/2011 + .......................................... 5,000 5,027
5.125%, Due 4/18/2011 + ........................................ 4,400 4,719
6.25%, Due 7/15/2032 ........................................... 1,200 1,461
-----------
11,207
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 3.35%
2.875%, Due 12/11/2013 + ....................................... 2,000 2,041
5.125%, Due 1/2/2014 ........................................... 385 395
4.625%, Due 10/15/2014 + ....................................... 500 550
5.375%, Due 6/12/2017 + ........................................ 4,000 4,506
-----------
7,492
-----------
TOTAL U.S. AGENCY OBLIGATIONS ..................................... 35,465
-----------
U.S. TREASURY OBLIGATIONS - 15.23%
1.375%, Due 2/15/2012 .......................................... 2,925 2,933
2.00%, Due 11/30/2013 + ........................................ 2,000 2,009
1.75%, Due 3/31/2014 + ......................................... 3,910 3,866
4.125%, Due 5/15/2015 + ........................................ 5,000 5,516
4.25%, Due 11/15/2017 + ........................................ 2,400 2,632
9.125%, Due 5/15/2018 .......................................... 650 953
2.75%, Due 2/15/2019 + ......................................... 4,590 4,446
7.875%, Due 2/15/2021 + ........................................ 1,050 1,465
6.25%, Due 8/15/2023 + ......................................... 1,900 2,375
6.875%, Due 8/15/2025 + ........................................ 770 1,042
5.25%, Due 11/15/2028 + ........................................ 750 865
4.75%, Due 2/15/2037 + ......................................... 3,000 3,332
4.50%, Due 5/15/2038 + ......................................... 2,445 2,631
-----------
TOTAL U.S. TREASURY OBLIGATIONS ................................... 34,065
-----------
See accompanying notes
36
AMERICAN BEACON INTERMEDIATE BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
SHARES VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
SHORT TERM INVESTMENTS - 4.61%
Columbia Government Reserve Fund .................................. 10,325,338 $ 10,325
-----------
SECURITIES LENDING COLLATERAL - 18.88%
American Beacon U.S. Government Money Market Select Fund * ........ 9,066,065 9,066
State Street Navigator Securities Lending Prime Portfolio ......... 33,164,308 33,164
-----------
TOTAL SECURITIES LENDING COLLATERAL ............................... 42,230
-----------
TOTAL INVESTMENTS - 120.94% (COST $270,796) .......................... $ 270,571
LIABILITIES, NET OF OTHER ASSETS - (20.94%) .......................... (46,847)
-----------
TOTAL NET ASSETS - 100.00% ........................................... $ 223,724
===========
Percentages are stated as a percent of net assets.
+ All or a portion of this security is on loan at April 30, 2009.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $3,122 or 1.40% of net
assets. The Fund has no right to demand registration of these securities.
# Step Up/Down
ss. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the final maturity date.
* The Fund is affiliated by having the same investment advisor.
See accompanying notes
37
AMERICAN BEACON SHORT-TERM BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
CORPORATE OBLIGATIONS - 18.85%
BANKS - 4.56%
Citigroup, Inc.,
4.125%, Due 2/22/2010 .......................................... $ 1,000 $ 984
4.625%, Due 8/3/2010 ........................................... 1,000 972
Goldman Sachs Group, Inc., 6.65%, Due 5/15/2009 ................... 1,000 1,002
HSBC Bank USA, 3.875%, Due 9/15/2009 .............................. 2,000 1,981
JP Morgan Chase & Co., 6.75%, Due 2/1/2011 ........................ 2,000 2,074
National Westminster Bank plc, 7.375%, Due 10/1/2009 .............. 2,000 1,958
Wells Fargo & Co, 3.98%, Due 10/29/2010 ........................... 1,000 964
-----------
9,935
-----------
FINANCE - 3.68%
Berkshire Hathaway Finance Corp., 4.00%, Due 4/15/2012 ++ ......... 1,000 1,016
Credit Suisse USA, Inc., 4.70%, Due 6/1/2009 ...................... 2,000 2,005
General Electric Capital Corp., 5.875%, Due 2/15/2012 ............. 3,000 3,057
MBNA Corp., 7.50%, Due 3/15/2012 .................................. 2,000 1,925
-----------
8,003
-----------
INDUSTRIALS - 5.52%
Burlington Northern Santa Fe Corp., 6.75%, Due 7/15/2011 .......... 1,000 1,052
Caterpillar Financial Services Corp.,
4.15%, Due 1/15/2010 ........................................... 2,000 2,028
4.25%, Due 2/8/2013 ............................................ 500 487
Daimler Finance NA LLC, 5.75%, Due 9/8/2011 ....................... 1,000 982
John Deere Capital Corp.,
4.125%, Due 1/15/2010 .......................................... 2,325 2,354
5.25%, Due 10/1/2012 ........................................... 1,000 1,025
Lockheed Martin Corp., 8.20%, Due 12/1/2009 ....................... 1,000 1,020
Nissan Motor Acceptance Corp., 4.625%, Due 3/8/2010 ++ ............ 1,000 951
Norfolk Southern Corp., 8.625%, Due 5/15/2010 ..................... 1,000 1,045
Northrop Grumman Corp., 7.125%, Due 2/15/2011 ..................... 1,000 1,064
-----------
12,008
-----------
INSURANCE - 3.16%
ING Security Life Institutional Funding, 4.25%, Due 1/15/2010 ++ .. 1,500 1,450
John Hancock Global Funding II, 7.90%, Due 7/2/2010 ++ ............ 2,000 2,046
Metropolitan Life Global Funding I, 4.625%, Due 8/19/2010 ++ ...... 1,500 1,459
Monumental Global Funding II, 4.625%, Due 3/15/2010 ++ ............ 1,000 969
Pricoa Global Funding 1, 4.20%, Due 1/15/2010 ++ .................. 1,000 957
-----------
6,881
-----------
REAL ESTATE - 0.43%
Simon Property Group LP, 5.375%, Due 6/1/2011 ..................... 1,000 945
-----------
TECHNOLOGY - 0.27%
Cisco Systems, Inc., 5.25%, Due 2/22/2011 ......................... 550 585
-----------
See accompanying notes
38
AMERICAN BEACON SHORT-TERM BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
TELEPHONE - 1.23%
AT&T Wireless Services, Inc., 7.875%, Due 3/1/2011 ................ $ 550 $ 596
Verizon Wireless Capital, LLC, 5.25%, Due 2/1/2012 ++ ............. 1,000 1,036
Vodafone Group plc, 5.50%, Due 6/15/2011 .......................... 1,000 1,051
-----------
2,683
-----------
TOTAL CORPORATE OBLIGATIONS ....................................... 41,040
-----------
NON-AGENCY MORTGAGE-BACKED OBLIGATIONS - 0.68%
Banc of America Commercial Mortgage, Inc.,
2005-6 A1, 5.001%, Due 9/10/2047 ............................... 389 388
2007-2 A2, 5.634%, Due 4/10/2049 ............................... 800 684
Wachovia Bank Commercial Mortgage Trust, 2006-C23 A1, 5.203%, Due
1/15/2045 ...................................................... 418 417
-----------
TOTAL NON-AGENCY MORTGAGE-BACKED OBLIGATIONS ...................... 1,489
-----------
ASSET-BACKED SECURITIES - 4.51%
Capital Auto Receivables Asset Trust,
2006-SN1A A4A, 5.32%, Due 3/20/2010 ++ ......................... 856 853
2006-1 A4, 5.04%, Due 5/17/2010 ................................ 91 92
CarMax Auto Owner Trust, 2005-3 A4, 4.91%, Due 1/18/2011 .......... 725 731
Chase Manhattan Auto Owner Trust, 2006-A A4, 5.36%, Due
1/15/2013 ...................................................... 2,000 2,021
Harley-Davidson Motorcycle Trust, 2007-3 A4, 5.52%, Due
11/15/2013 ..................................................... 2,000 1,968
USAA Auto Owner Trust, 2007-1 A4, 5.55%, Due 2/15/2013 ............ 3,000 3,130
Volkswagen Auto Loan Enhanced Trust, 2008-2 A4A, 6.24%, Due
7/20/2015 ...................................................... 1,000 1,026
-----------
TOTAL ASSET-BACKED SECURITIES ..................................... 9,821
-----------
U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS - 0.88%
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 0.88%
4.968%, Due 12/16/2021 ......................................... 538 547
4.201%, Due 8/16/2026 .......................................... 1,338 1,360
-----------
TOTAL U.S. AGENCY MORTGAGE-BACKED OBLIGATIONS ..................... 1,907
-----------
U.S. AGENCY OBLIGATIONS - 56.07%
FDIC GUARANTEED - 29.63%
US Bank NA (FDIC Guaranteed), 1.02%, Due 9/21/2009 ............. 10,000 9,985
Goldman Sachs Group, Inc. (FDIC Guaranteed), 1.70%, Due
3/15/2011 + ................................................. 10,000 10,079
Citibank NA (FDIC Guaranteed), 1.625%, Due 3/30/2011 + ......... 10,000 10,053
Citigroup, Inc. (FDIC Guaranteed), 2.875%, Due 12/9/2011 ....... 1,000 1,028
General Electric Capital Corp. (FDIC Guaranteed), 3.00%, Due
12/9/2011 ................................................... 1,000 1,032
Wells Fargo & Co. (FDIC Guaranteed), 3.00%, Due 12/9/2011 ...... 1,000 1,030
General Electric Capital Corp. (FDIC Guaranteed), 2.25%, Due
3/12/2012 ................................................... 5,000 5,048
Morgan Stanley (FDIC Guaranteed), 2.25%, Due 3/13/2012 ......... 10,000 10,054
Bank of America Corp. (FDIC Guaranteed), 3.125%, Due
6/15/2012 ................................................... 1,000 1,036
JP Morgan Chase & Co. (FDIC Guaranteed), 2.20%, Due
6/15/2012 ................................................... 3,000 3,014
Bank of America Corp. (FDIC Guaranteed), 2.375%, Due
6/22/2012 ................................................... 10,000 10,137
JP Morgan Chase & Co. (FDIC Guaranteed), 2.125%, Due
6/22/2012 ................................................... 1,000 1,002
See accompanying notes
39
AMERICAN BEACON SHORT-TERM BOND FUND
SCHEDULE OF INVESTMENTS
April 30, 2009 (Unaudited)
PAR
AMOUNT VALUE
------------ -----------
(DOLLARS IN THOUSANDS)
PNC Funding Corp. (FDIC Guaranteed), 2.30%, Due 6/22/2012 + .... $ 1,000 $ 1,003
-----------
64,501
-----------
FEDERAL HOME LOAN MORTGAGE CORPORATION - 20.87%
4.75%, Due 11/3/2009 ........................................... 5,000 5,108
1.625%, Due 4/26/2011 + ........................................ 20,000 20,125
2.125%, Due 3/23/2012 + ........................................ 20,000 20,208
-----------
45,441
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 5.57%
7.25%, Due 1/15/2010 ........................................... 2,000 2,092
1.375%, Due 4/28/2011 + ........................................ 10,000 10,021
-----------
12,113
-----------
TOTAL U.S. AGENCY OBLIGATIONS ..................................... 122,055
-----------
U.S. TREASURY OBLIGATIONS - 23.72%
2.875%, Due 6/30/2010 .......................................... 10,000 10,269
1.50%, Due 10/31/2010 + ........................................ 20,000 20,228
4.375%, Due 12/15/2010 + ....................................... 20,000 21,153
-----------
TOTAL U.S. TREASURY OBLIGATIONS ................................... 51,650
-----------
SHARES
------------
SHORT TERM INVESTMENTS - 0.22%
Columbia Government Reserve Fund .................................. 483,078 483
-----------
SECURITIES LENDING COLLATERAL - 21.90%
American Beacon U.S. Government Money Market Select Fund # ........ 10,233,552 10,234
State Street Navigator Securities Lending Prime Portfolio ......... 37,435,059 37,435
-----------
TOTAL SECURITIES LENDING COLLATERAL ............................... 47,669
-----------
TOTAL INVESTMENTS - 126.83% (COST $274,340) .......................... $ 276,114
LIABILITIES, NET OF OTHER ASSETS - (26.83%) .......................... (58,415)
-----------
TOTAL NET ASSETS - 100.00% ........................................... $ 217,699
===========
Percentages are stated as a percent of net assets.
+ All or a portion of this security is on loan at April 30, 2009.
++ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $10,737 or 4.93% of net
assets. The Fund has no right to demand registration of these securities.
# The Fund is affiliated by having the same investment advisor.
See accompanying notes
40
AMERICAN BEACON FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 2007 (UNAUDITED)(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
ENHANCED
HIGH YIELD INCOME INTERMEDIATE SHORT-TERM
BOND FUND FUND BOND FUND BOND FUND
---------- ---------- ------------ -----------
ASSETS:
Investments in unaffiliated securities, at value (A, C).. $ 167,209 $ 84,009 $ 261,505 $ 265,880
Investments in affiliated securities, at value (B) ...... -- 234 9,066 10,234
Receivable for investments sold ......................... 2,636 -- 1,464 --
Dividends and interest receivable ....................... 4,848 732 1,867 1,485
Receivable for fund shares sold ......................... 10,455 7 32 310
Receivable for tax reclaims ............................. 5 1 1 --
Receivable for expense reimbursement .................... -- -- 1 5
Prepaid expenses ........................................ 18 7 31 39
---------- ---------- ------------ -----------
TOTAL ASSETS ......................................... 185,171 84,990 273,967 277,953
---------- ---------- ------------ -----------
LIABILITIES:
Payable for investments purchased ....................... 3,931 -- 1,582 --
Payable upon return of securities loaned ................ -- 1,092 42,231 47,669
Payable for fund shares redeemed ........................ 14,128 4 6,374 12,490
Dividends payable ....................................... 276 -- -- 9
Management and investment advisory fees payable (Note 2) 176 74 41 47
Administrative service and service fees payable ......... 32 43 10 21
Due to custodian for overdraft .......................... 700 -- -- --
Other liabilities ....................................... 69 22 5 18
---------- ---------- ------------ -----------
TOTAL LIABILITIES .................................... 19,312 1,235 50,243 60,254
---------- ---------- ------------ -----------
NET ASSETS ................................................. $ 165,859 $ 83,755 $ 223,724 $ 217,699
========== ========== ============ ===========
ANALYSIS OF NET ASSETS:
Paid-in-capital ............................................ 225,312 90,571 224,076 226,062
Undistributed net investment income ........................ 503 (374) 501 (510)
Accumulated net realized (loss) ............................ (30,568) (2,773) (628) (9,627)
Unrealized appreciation (depreciation) of investments,
futures contracts, and foreign currency ................. (29,388) (3,669) (225) 1,774
---------- ---------- ------------ -----------
NET ASSETS ................................................. $ 165,859 $ 83,755 $ 223,724 $ 217,699
========== ========== ============ ===========
Shares outstanding (no par value):
Institutional Class ..................................... 7,186,982 N/A 21,867,001 22,778,964
========== ========== ============ ===========
Investor Class .......................................... 9,340,212 8,863,863 38,501 2,322,843
========== ========== ============ ===========
AMR Class ............................................... 7,068,175 N/A N/A N/A
========== ========== ============ ===========
Net asset value, offering and redemption price per share:
Institutional Class ..................................... $ 7.03 N/A $ 10.21 $ 8.67
========== ========== ============ ===========
Investor Class .......................................... $ 7.03 $ 9.45 $ 10.21 $ 8.68
========== ========== ============ ===========
AMR Class ............................................... $ 7.03 N/A N/A N/A
========== ========== ============ ===========
A Cost of investments in unaffiliated securities ........... $ 196,597 $ 87,678 $ 261,730 $ 264,106
B Cost of investments in affiliated securities ............. $ -- $ 234 $ 9,066 $ 10,234
C Market value of securities on loan ....................... $ -- $ 1,069 $ 41,270 $ 46,829
See accompanying notes
41
AMERICAN BEACON FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 2009 (IN THOUSANDS) (UNAUDITED)
ENHANCED
HIGH YIELD INCOME INTERMEDIATE SHORT-TERM
BOND FUND FUND BOND FUND BOND FUND
---------- ---------- ------------ ----------
INVESTMENT INCOME:
Dividend income from unaffiliated securities ............ $ 28 $ 151 $ 25 $ 13
Dividend income from affiliated securities .............. 9 4 11 2
Interest income ......................................... 8,805 1,973 4,445 3,573
Income derived from securities lending, net ............. -- 92 278 420
--------- ------ ------- ------
TOTAL INVESTMENT INCOME .............................. 8,842 2,220 4,759 4,008
--------- ------ ------- ------
EXPENSES:
Management and investment advisory fees (Note 2) ........ 242 127 208 281
Administrative service fees (Note 2):
Institutional Class .................................. 89 -- 52 66
Investor Class ....................................... 31 129 -- 23
AMR Class ............................................ 11 -- -- --
Transfer agent fees:
Institutional Class .................................. -- -- 5 6
Investor Class ....................................... 1 4 -- --
Custody and fund accounting fees ........................ 10 6 18 24
Professional fees ....................................... 13 13 10 12
Registration fees and expenses .......................... 19 9 8 20
Service fees (Note 2):
Investor Class ....................................... 26 115 -- 19
Prospectus and shareholder reports ...................... 28 1 2 4
Trustee fees ............................................ 4 3 2 2
Other expenses .......................................... 4 2 4 5
--------- ------ ------- ------
TOTAL EXPENSES ....................................... 478 409 309 462
--------- ------ ------- ------
Net (fees waived and expenses reimbursed)/recouped by
Manager (Note 2) ..................................... -- -- -- (20)
--------- ------ ------- ------
NET EXPENSES ......................................... 478 409 309 442
--------- ------ ------- ------
NET INVESTMENT INCOME ...................................... 8,364 1,811 4,450 3,566
--------- ------ ------- ------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from:
Investments .......................................... (13,947) (480) 1,144 3,348
Change in net unrealized appreciation or depreciation of:
Investments .......................................... 21,735 7,107 8,522 1,326
--------- ------ ------- ------
NET GAIN ON INVESTMENTS .............................. 7,788 6,627 9,666 4,674
--------- ------ ------- ------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ....... $ 16,152 $8,438 $14,116 $8,240
========= ====== ======= ======
See accompanying notes
42
AMERICAN BEACON FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (IN THOUSANDS)
High Yield Bond Fund Enhanced Income Fund
------------------------ ------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
April 30, October 31, April 30, October 31,
2009 2008 2009 2008
---------- ----------- ---------- -----------
(unaudited) (unaudited)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ................................. $ 8,364 $ 15,343 $ 1,811 $ 3,923
Net realized (loss) on investments, futures
contracts, and foreign currency transactions ....... (13,947) (14,708) (480) (1,148)
Change in net unrealized appreciation or
depreciation of investments, futures contracts,
and foreign currency translations .................. 21,735 (48,374) 7,107 (14,259)
-------- --------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ....................... 16,152 (47,739) 8,438 (11,484)
-------- --------- --------- ---------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Institutional Class ................................ (4,032) (7,731) -- --
Investor Class ..................................... (1,307) (1,837) (2,155) (5,038)
AMR Class .......................................... (3,023) (5,774) -- --
Net realized gain on investments:
Investor Class ..................................... -- -- -- (2,097)
-------- --------- --------- ---------
NET DISTRIBUTIONS TO SHAREHOLDERS .................. (8,362) (15,342) (2,155) (7,135)
-------- --------- --------- ---------
CAPITAL SHARE TRANSACTIONS:
Proceeds from sales of shares ......................... 104,416 72,610 8,039 79,277
Reinvestment of dividends and distributions ........... 7,068 13,364 2,153 7,127
Cost of shares redeemed ............................... (73,562) (128,737) (33,189) (67,105)
-------- --------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ......................... 37,922 (42,763) (22,997) 19,299
-------- --------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS .................... 45,712 (105,844) (16,714) 680
-------- --------- --------- ---------
NET ASSETS:
Beginning of period ................................... 120,147 225,991 100,469 99,789
-------- --------- --------- ---------
END OF PERIOD * ....................................... $165,859 $ 120,147 $ 83,755 $ 100,469
======== ========= ========= =========
*Includes undistributed net investment income (loss) of .. $ 503 $ 503 $ (374) $ (96)
======== ========= ========= =========
See accompanying notes
43
AMERICAN BEACON FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (IN THOUSANDS)
Intermediate Bond Fund Short-Term Bond Fund
------------------------ ------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
April 30, October 31, April 30, October 31,
2009 2008 2009 2008
---------- ----------- ---------- -----------
(unaudited) (unaudited)
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ................................. $ 4,450 $ 7,050 $ 3,566 $ 5,355
Net realized gain (loss) on investments, futures
contracts, and foreign currency transactions ....... 1,144 70 3,348 (4,833)
Change in net unrealized appreciation or
depreciation of investments, futures contracts,
and foreign currency translations .................. 8,522 (8,956) 1,326 309
--------- ---------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ....................... 14,116 (1,836) 8,240 831
--------- ---------- --------- ---------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Institutional Class ................................ (4,476) (7,053) (5,019) (6,084)
Investor Class ..................................... (1) -- (264) (220)
Net realized gain on investments:
--------- ---------- --------- ---------
NET DISTRIBUTIONS TO SHAREHOLDERS .................. (4,477) (7,053) (5,283) (6,304)
--------- ---------- --------- ---------
CAPITAL SHARE TRANSACTIONS:
Proceeds from sales of shares ......................... 125,113 103,092 45,899 200,633
Reinvestment of dividends and distributions ........... 4,477 7,052 5,219 6,236
Cost of shares redeemed ............................... (63,139) (63,295) (99,834) (30,341)
--------- ---------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ....................... 66,451 46,849 (48,716) 176,528
--------- ---------- --------- ---------
NET INCREASE (DECREASE) IN NET ASSETS .................... 76,090 37,960 (45,759) 171,055
--------- ---------- --------- ---------
NET ASSETS:
Beginning of period ................................... 147,634 109,674 263,458 92,403
--------- ---------- --------- ---------
END OF PERIOD * ....................................... $ 223,724 $ 147,634 $217,699 $ 263,458
========= ========== ========= =========
*Includes undistributed net investment income (loss) of .. $ 501 $ 501 $ (510) $ (563)
========= ========== ========= =========
See accompanying notes
44
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
American Beacon Funds (the "Trust") is organized as a Massachusetts
business trust and is registered under the Investment Company Act of 1940, as
amended, (the "Act") as a diversified, open-end management investment company.
These financial statements and notes to the financial statements relate to the
American Beacon High Yield Bond Fund, the American Beacon Enhanced Income Fund,
the American Beacon Intermediate Bond Fund and the American Beacon Short-Term
Bond Fund (each a "Fund" and collectively, the "Funds"), each a series of the
Trust.
American Beacon Advisors, Inc. (the "Manager"), is a wholly-owned
subsidiary of Lighthouse Holdings, Inc. and was organized in 1986 to provide
business management, advisory, administrative and asset management consulting
services to the Trust and other investors.
Class Disclosure
Prior to March 1, 2009, the Investor Class was known as the PlanAhead
Class. March 2, 2009 is the inception date of the Investor Class of the
Intermediate Bond Fund.
Each Fund, except the Enhanced Income Fund, has multiple classes of shares
designed to meet the needs of different groups of investors; however, not all
Funds offer all classes. The following table sets forth the differences amongst
the classes:
CLASS: OFFERED TO:
- ------ -----------
INSTITUTIONAL CLASS Investors making an initial investment of $2 million
INVESTOR CLASS General public and investors investing through an intermediary
AMR CLASS Investors in the tax-exempt retirement and benefit plans of AMR Corporation and its affiliates
Administrative service fees, service fees and distribution fees vary
amongst the classes as described more fully in footnote 2.
Investment income, net capital gains (losses) and all expenses incurred by
the Funds are allocated based on the relative net assets of each class, except
for service fees and certain other fees and expenses related solely to one class
of shares.
Security Valuation
Investments are valued at the close of the New York Stock Exchange (the
"Exchange"), normally 4 p.m. ET, each day that the Exchange is open for
business. Equity securities for which market quotations are available are valued
at the last sale price or official closing price (closing bid price or last
evaluated quote if no sale has occurred) on the primary market or exchange on
which they trade.
Debt securities (other than short-term securities) normally are valued on
the basis of prices provided by an independent pricing service and may take into
account appropriate factors such as institution-size trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data. The prices of debt securities may be
determined using quotes obtained from brokers.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation. Investment grade short-term
obligations with 60 days or less to maturity are valued using the amortized cost
method, which approximates market value.
45
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Securities for which market prices are not readily available or are not
reflective of the fair value of the security, as determined by the Manager, will
be priced at fair value following procedures approved by the Board of Trustees
(the "Board").
The Funds adopted the provisions of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective with the
beginning of the Funds' fiscal year. The standard clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires additional disclosures about the use of fair value
measurements. The three levels of the hierarchy uder FAS 157 are described
below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Prices determined using other significant observable inputs.
These may include quoted prices for similar securities, interest rates,
prepayment speeds, credit risk, and others.
Level 3 - Prices determined using other significant unobservable inputs.
Unobservable inputs reflect the Fund's own assumptions about the factors
market participants would use in pricing an investment, and would be based
on the best information available.
A summary of the inputs used to value the Fund's investments as of April 30,
2009 is as follows (in thousands):
High Yield Bond
Investments in
Valuation Inputs Securities
---------------- --------------
Level 1 - Quoted prices ....................... $ 9,584
Level 2 - Other significant observable inputs.. 157,625
Level 3 - Significant unobservable inputs ..... --
--------
Total ......................................... $167,209
--------
Enhanced Income
Investments in
Valuation Inputs Securities
---------------- --------------
Level 1 - Quoted prices......................... $ 9,998
Level 2 - Other significant observable inputs... 74,245
Level 3 - Significant unobservable inputs....... --
--------
Total........................................... $ 84,243
--------
Intermediate Bond
Investments in
Valuation Inputs Securities
---------------- --------------
Level 1 - Quoted prices......................... $ 52,555
Level 2 - Other significant observable inputs... 218,016
Level 3 - Significant unobservable inputs....... --
--------
Total........................................... $270,571
--------
Short-Term Bond
Investments in
Valuation Inputs Securities
---------------- --------------
Level 1 - Quoted prices......................... $ 48,152
Level 2 - Other significant observable inputs... 227,962
Level 3 - Significant unobservable inputs....... --
--------
Total........................................... $276,114
--------
Security Transactions and Investment Income
Security transactions are recorded on the trade date of the security
purchase or sale. The Funds may purchase securities with delivery or payment to
occur at a later date. At the time the Funds enter into a commitment to purchase
a security, the transaction is recorded and the value of the security is
reflected in the net asset value. The value of the security may vary with market
fluctuations.
46
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Dividend income, net of foreign taxes, is recorded on the ex-dividend date.
Interest income is earned from settlement date, recorded on the accrual basis,
and adjusted, if necessary, for accretion of discounts and amortization of
premiums. For financial and tax reporting purposes, realized gains and losses
are determined on the basis of specific lot identification.
Dividends to Shareholders
Dividends from net investment income of the Funds generally will be
declared daily, payable monthly. Distributions, if any, of net realized capital
gains are generally paid at least annually and recorded on the ex-dividend date.
Commission Recapture
The Funds have established brokerage commission recapture arrangements with
certain brokers or dealers. If a Fund's investment advisor chooses to execute a
transaction through a participating broker, the broker rebates a portion of the
commission back to the Fund. Any collateral benefit received through
participation in the commission recapture program is directed exclusively to the
Fund. These amounts are reported with the net realized gains in the Funds'
Statements of Operations.
Allocation of Income, Expenses, Gains and Losses
Income, expenses (other than those attributable to a specific class), gains
and losses are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses directly
attributable to a specific class are charged against the operations of that
class.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results may differ from those estimated.
Recently Issued Accounting Pronouncements
In March 2008, FASB issued Statement of Financial Accounting Standards No.
161, "Disclosures about Derivative Instruments and Hedging Activities" ("FAS
161"), which is effective for fiscal years and interim periods beginning after
November 15, 2008. FAS 161 requires enhanced disclosures about derivative and
hedging activities, including how such activities are accounted for and their
effect on financial positions, performance and cash flows. The Manager is
currently evaluating the impact the adoption of FAS 161 will have on the Funds'
financial statements and related disclosures.
Other
Under the Trust's organizational documents, its officers and directors are
indemnified against certain liability arising out of the performance of their
duties to the Trust. In the normal course of business, the Trust enters into
contracts that provide indemnification to the other party or parties against
potential costs or liabilities. The Trust's maximum exposure under these
arrangements is dependent on claims that may be made in the future and,
therefore, cannot be estimated. The Trust has had no prior claims or losses
pursuant to any such agreement.
47
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
2. TRANSACTIONS WITH AFFILIATES
Management Agreement
The Trust and the Manager are parties to a Management Agreement that
obligates the Manager to provide or oversee the provision of all investment
advisory, fund management and securities lending services. Investment assets of
the High Yield Bond, Enhanced Income, and Intermediate Bond Funds are managed by
one or more investment advisors which have entered into separate investment
advisory agreements with the Manager. As compensation for performing the duties
required under the Management Agreement, the Manager receives from the High
Yield Bond Fund and Enhanced Income Fund an annualized fee equal to 0.05% of the
average daily net assets plus amounts paid by the Manager to the investment
advisors hired by the Manager to direct investment activities of the Funds. The
Manager receives an annualized fee of 0.20% of the average daily net assets of
the Intermediate Bond Fund and pays a portion of its fee to an investment
advisor hired by the Manager to direct investment activities of a portion of the
Fund. The Manager is one of the investment advisors of the Enhanced Income Fund
and receives an annualized fee of 0.15% on the portion of assets managed by the
Manager. The Manager serves as the sole investment advisor to the Short-Term
Bond Fund. Pursuant to the Management Agreement, the Manager receives from the
Fund an annualized fee equal to 0.20% of the average daily net assets of the
Short-Term Bond Fund. Management fees paid during the six months ended April 30,
2009 were as follows (dollars in thousands):
AMOUNTS PAID NET AMOUNTS
MANAGEMENT MANAGEMENT TO INVESTMENT RETAINED BY
FEE RATE FEE ADVISORS MANAGER
---------- ----------- ------------- -------------
High Yield Bond ..... 0.30%-0.37% 242 211 31
Enhanced Income ..... 0.20%-0.80% 127 106 21
Intermediate Bond ... 0.20% 208 122 86
As compensation for services provided by the Manager in connection with
securities lending activities, the lending Fund pays to the Manager, with
respect to cash collateral posted by borrowers, a fee up to 25% of the net
monthly interest income (the gross interest income earned by the investment of
cash collateral, less the amount paid to borrowers and related expenses) from
such activities and, with respect to loan fees paid by borrowers when a borrower
posts collateral other than cash, a fee up to 25% of such loan fees. This fee is
netted against securities lending income in the Statements of Operations. During
the six months ended April 30, 2009, securities lending fees paid to the Manager
were as follows (in thousands):
Enhanced Income ..... 11
Intermediate Bond ... 38
Short-Term Bond ..... 54
Administrative Services Agreement
The Manager and the Trust entered into an Administrative Services Agreement
which obligates the Manager to provide or oversee administrative services to the
Funds. As compensation for performing the duties required under the
Administrative Services Agreement, the Manager receives an annualized fee of
0.05% of the average daily net assets of the AMR Class and 0.30% of the average
daily net assets of the Institutional and Investor Classes of each of the Funds
except for the Institutional Class of the Intermediate and Short-Term Bond Funds
from which the Manager received a fee of 0.05% of average daily net assets.
Distribution Plans
The Trust has adopted a "defensive" Distribution Plan (the "Plan") in
accordance with Rule 12b-1 under the Act, pursuant to which no fees may be
charged to the Funds for distribution purposes. However, the Plan authorizes the
management and administrative service fees received by the Manager and the
investment advisors hired by the Manager to be used for distribution purposes.
Under this Plan, the Trust does not intend to compensate the Manager or any
other party, either directly or indirectly, for the distribution of Trust
shares.
48
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
Service Plans
The Manager and the Trust entered into Service Plans that obligate the
Manager to oversee additional shareholder servicing of the Investor Class. As
compensation for performing the duties required under the Service Plan, the
Manager received 0.25% of the average daily net assets of the Investor Class of
each Fund through March 31, 2009 and up to 0.375% thereafter.
Investment in Affiliated Funds
The Funds may invest in the American Beacon Money Market Select Fund (the
"MM Select Fund") and the American Beacon US Government Money Market Select Fund
(the "USG Select Fund") (collectively, the "Select Funds"). Cash collateral
received by certain Funds in connection with securities lending may be invested
in the Select Funds. The Funds and the Select Funds have the same investment
advisor and therefore, are considered to be affiliated. The Manager serves as
investment advisor to the Select Funds and receives from the Select Funds an
annualized management fee of 0.09% of the average daily net assets of the Select
Funds. During the six months ended April 30, 2009, fees earned by the Manager
from the Select Funds are as follows:
SECURITIES LENDING
DIRECT INVESTMENT IN COLLATERAL INVESTED
SELECT FUNDS IN SELECT FUNDS TOTAL
-------------------- ------------------- -----
High Yield Bond...... 268 -- 268
Enhanced Income...... 343 1,091 1,434
Intermediate Bond.... 825 4,403 5,228
Short-Term Bond...... 139 6,120 6,259
Interfund Lending Program
Pursuant to an exemptive order by the Securities and Exchange Commission
("SEC"), the Funds, along with other registered investment companies having
management contracts with the Manager, may participate in an interfund lending
program as a borrower. This program provides an alternative credit facility
allowing the Funds to borrow from other participating Funds. During the six
months ended April 30, 2009, the Fund did not utilize the credit facility.
Reimbursement of Expenses
The Manager voluntarily agreed to reimburse the Investor Class of the
Short-Term and Intermediate Bond Funds for operating expenses. During the period
ended April 30, 2009, the Manager waived Short-Term Bond service fees of $20,096
and amounts waived for the Investor Class of the Intermediate Bond Fund were
immaterial during the period.
Expense Reimbursement Plan
The Funds have adopted an Expense Reimbursement Plan whereby the Manager
may seek repayment of fees waived or expenses reimbursed for a period of up to
three years. However, reimbursement will occur only if the Class' average net
assets have grown or expenses have declined sufficiently to allow reimbursement
without causing its expense ratio to exceed the previously agreed upon
contractual expense limit. During the six months ended April 30, 2009, the Funds
have not recorded a liability for potential reimbursement, due to the current
assessment that a reimbursement is unlikely.
3. FEDERAL INCOME AND EXCISE TAXES
It is the policy of each of the Funds to comply with the requirements of
Subchapter M of the Internal Revenue Code and to distribute substantially all
net investment income as well as any net realized capital gains on the sale of
investments. Therefore, no federal income or excise tax provision is required.
49
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
The Funds adopted the provisions of FASB Interpretation No. 48, "Accounting
for Uncertainties in Income Taxes" ("FIN 48"), on November 1, 2007. FIN 48 sets
forth a minimum threshold for financial statement recognition of the benefit of
a tax position taken or expected to be taken in a tax return. The implementation
of FIN 48 did not result in any unrecognized tax benefits in the accompanying
financial statements. Each of the tax years in the three year period ended
October 31, 2008 remains subject to examination by the Internal Revenue Service.
If applicable, the Funds recognize interest accrued related to unrecognized tax
benefits in interest expense and penalties in "Other expenses" on the Statements
of Operations.
Dividends are categorized in accordance with income tax regulations which
may treat certain transactions differently than U.S. generally accepted
accounting principles. Accordingly, the character of distributions and
composition of net assets for tax purposes may differ from those reflected in
the accompanying financial statements.
The tax character of distributions paid during the six months ended April
30, 2009 and fiscal year ended October 31, 2008 were as follows (in thousands):
HIGH YIELD BOND ENHANCED INCOME
----------------------- -------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2009 2008 2009 2008
---------- ---------- ----------- -----------
(UNAUDITED) (UNAUDITED)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class .... $4,032 $ 7,731 $ -- $ --
Investor Class ......... 1,307 1,837 2,155 5,674
AMR Class .............. 3,023 5,774 -- --
LONG-TERM CAPITAL GAIN .... --
Institutional Class .... -- -- -- --
Investor Class ......... -- -- -- 1,461
AMR Class .............. -- -- -- --
------ ------- ------ ------
TOTAL DISTRIBUTIONS PAID .. $8,362 $15,342 $2,155 $7,135
------ ------- ------ ------
INTERMEDIATE BOND SHORT-TERM BOND
----------------------- -----------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, OCTOBER APRIL 30, OCTOBER
2009 31, 2008 2009 31, 2008
---------- ---------- ----------- -----------
(UNAUDITED) (UNAUDITED)
DISTRIBUTIONS PAID FROM:
ORDINARY INCOME*
Institutional Class .... $4,476 $7,053 $5,019 $6,084
Investor Class ......... 1 -- 264 220
AMR Class .............. -- -- -- --
LONG-TERM CAPITAL GAIN .... -- --
Institutional Class .... -- -- -- --
Investor Class ......... -- -- -- --
AMR Class .............. -- -- -- --
------ ------ ------ ------
TOTAL DISTRIBUTIONS PAID .. $4,477 $7,053 $5,283 $6,304
------ ------ ------ ------
* For tax purposes, short-term capital gains are considered ordinary income
distributions.
As of April 30, 2009, the components of distributable earnings on a tax basis
were as follows (in thousands):
50
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
HIGH YIELD ENHANCED INTERMEDIATE SHORT-TERM
BOND INCOME BOND BOND
---------- -------- ------------ ----------
Cost basis of investments for federal income tax purpose .. $198,935 $88,132 $270,806 $275,365
Unrealized appreciation ................................... 4,109 2,074 4,872 2,061
Unrealized depreciation ................................... (35,835) (5,963) (5,107) (1,312)
-------- ------- -------- --------
Net unrealized appreciation (depreciation) ................ (31,726) (3,889) (235) 749
Undistributed ordinary income ............................. 227 -- 502 506
Undistributed long-term gain (loss) ....................... (28,230) (2,753) (618) (9,627)
-------- ------- -------- --------
Distributable earnings (losses) ........................... $(59,729) $(6,642) $ (351) $ (8,372)
======== ======= ======== ========
Financial reporting records are adjusted for permanent book/tax differences
to reflect tax character. Financial records are not adjusted for temporary
differences. The temporary differences between financial reporting and tax-basis
reporting of unrealized appreciation/(depreciation) are attributable primarily
to the tax deferral of losses from wash sales, book amortization for premiums,
and income adjustments associated with contingent payment debt instruments.
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under U.S. generally accepted accounting principles and
federal income tax regulations, permanent differences between book and tax
reporting have been identified and appropriately reclassified on the Statements
of Assets and Liabilities.
Accordingly, the following amounts represent current year permanent
differences derived from reclassifications of income from real estate investment
securities, foreign currency, book amortization of premium, pay down reclasses,
income adjustments associated with contingent payment debt instruments, and
dividend reclasses that have been reclassified as of April 30, 2009 (in
thousands):
HIGH YIELD ENHANCED INTERMEDIATE SHORT-TERM
BOND INCOME BOND BOND
---------- -------- ------------ ----------
Paid-in-capital ................................................ $ -- $ 137 $ (1) $ 22
Undistributed net investment income ............................ (2) 66 27 1,770
Accumulated net realized gain (loss) ........................... 1 (204) (26) (1,792)
Unrealized appreciation
(depreciation) of investments and futures contracts ......... 1 1 -- --
At April 30, 2009 capital loss carry forward positions for federal income
tax purposes were as follows (in thousands):
FUND 2012 2013 2014 2015 2016 2017 TOTAL
- ---- ---- ----- ----- ---- ------ ------ ------
High Yield Bond .... -- -- 1,772 -- 14,332 12,126 28,230
Enhanced Income .... -- -- -- -- 2,100 653 2,753
Intermediate Bond... -- -- 618 -- -- -- 618
Short-Term Bond .... 318 1,256 2,387 467 5,199 -- 9,627
The Intermediate and Short-Term Bond Funds utilized $1,126 and $1,556,
respectively of net capital loss carryovers for the six months ended April 30,
2009.
4. INVESTMENT TRANSACTIONS
The aggregate cost of purchases and proceeds from sales and maturities of
long-term investments during the six months ended April 30, 2009 were as follows
(in thousands):
51
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
SHORT-TERM
HIGH YIELD BOND ENHANCED INCOME INTERMEDIATE BOND BOND
--------------- --------------- ----------------- ----------
Purchases (excluding U.S. government securities) .............. $119,191 $11,936 $145,408 $125,451
Sales and maturities (excluding U.S. government securities) ... 79,827 32,915 68,793 6,655
Purchases of U.S. government securities ....................... -- 5,808 111,140 95,513
Sales and maturities of U.S. government securities ............ -- 8,140 115,332 256,194
A summary of the Funds' direct transactions in the Select Funds for the six
months ended April 30, 2009 is set forth below (in thousands):
OCTOBER 31, 2008 APRIL 30, 2009
AFFILIATE SHARES/MARKET VALUE PURCHASES SALES SHARES/MARKET VALUE
-------------- ------------------- --------- ------ -------------------
High Yield Bond ..... MM Select Fund $5,762 -- $5,762 --
Enhanced Income ..... MM Select Fund 3,057 -- 3,057 --
Intermediate Bond ... MM Select Fund 7,368 -- 7,368 --
Short-Term Bond ..... MM Select Fund 1,241 -- 1,241 --
5. SECURITIES LENDING
Each Fund may lend its securities to qualified financial institutions, such
as certain broker-dealers, to earn additional income. The borrowers are required
to secure their loans continuously with collateral in an amount at least equal
to the fair value of the securities loaned, initially in an amount at least
equal to 102% of the fair value of domestic securities loaned and 105% of the
fair value of international securities loaned. Collateral is monitored and
marked to market daily. Daily mark to market amounts are required to be paid to
the borrower or received from the borrower by the end of the following business
day. This one day settlement for mark to market amounts may result in the
collateral being temporarily less than the value of the securities on loan or
temporarily more than the required minimum collateral. The amount of this
temporary difference at April 30, 2009 is disclosed as the calculated mark in
the table below.
To the extent that a loan is collateralized by cash, such cash collateral
shall be invested by the securities lending agent (the "Agent") in money market
mutual funds, and other short-term investments, provided the investments meet
certain quality and diversification requirements.
Securities lending income is generated from the demand premium (if any)
paid by the borrower to borrow a specific security and from the return on
investment of cash collateral, reduced by negotiated rebate fees paid to the
borrower and transaction costs. To the extent that a loan is secured by non-cash
collateral, securities lending income is generated as a demand premium reduced
by transaction costs. The Fund, the Agent, and the Manager retain 75%, 15%, and
10%, respectively, of the income generated from securities lending.
While securities are on loan, the Fund continues to receive any income
associated with that security and any gain or loss in the market price that may
occur during the term of the loan.
Securities lending transactions pose certain risks to the Fund, including
that the borrower may not provide additional collateral when required or return
the securities when due, that the value of the short-term investments will be
less than the amount of cash collateral required to be returned to the borrower,
that non-cash collateral may be subject to legal constraints in the event of a
borrower bankruptcy, and that the cash collateral investments could become
illiquid and unable to be used to return collateral to the borrower. The Fund
could also experience delays and costs in gaining access to the collateral. The
Fund bears the risk of any deficiency in the amount of the cash collateral
available for return to the borrower and any action which impairs its ability to
liquidate non-cash collateral to satisfy a borrower default.
52
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
At April 30, 2009, the value of outstanding securities on loan and the
value of collateral was as follows (in thousands):
MARKET VALUE OF NON-CASH CASH COLLATERAL TOTAL VALUE OF
SECURITIES ON LOAN COLLATERAL POSTED BY BORROWER CALCULATED MARK COLLATERAL
------------------ ---------- ------------------ --------------- --------------
Enhanced Income $ 1,069 -- $ 1,093 (1) $ 1,092
Intermediate Bond 41,270 -- 42,230 (116) 42,114
Short-Term Bond 46,829 -- 47,669 113 47,782
Cash collateral is listed in the Fund's Schedule of Investments. The
allocated amounts have been included as investments in the Schedule of
Investments and Statement of Assets and Liabilities. Income earned on these
investments is included in Income derived from securities lending in the
Statement of Operations.
Non-cash collateral received by the Fund may not be sold or re-pledged
except to satisfy a borrower default. Therefore, non-cash collateral is not
included on the Fund's Schedule of Investments or Statement of Assets and
Liabilities.
6. CAPITAL SHARE TRANSACTIONS
The tables below summarize the activity in capital shares for each Class of
the Funds (shares and dollars in thousands):
SIX MONTHS ENDED APRIL 30, 2009
INSTITUTIONAL CLASS INVESTOR CLASS AMR CLASS
------------------- ------------------ -------------------
HIGH YIELD BOND FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- --------------------------------- ------- --------- ------- -------- ------- ---------
Shares sold ..................... 3,651 $ 24,029 10,461 $ 68,811 1,787 $ 11,576
Reinvestment of dividends ....... 428 2,785 190 1,261 463 3,022
Shares redeemed ................. (6,069) (40,544) (3,370) (22,097) (1,688) (10,921)
------ -------- ------ -------- ------ --------
Net increase (decrease) in shares
outstanding .................. (1,990) $(13,730) 7,281 $ 47,975 562 $ 3,677
====== ======== ====== ======== ====== ========
INVESTOR CLASS
-------------------
ENHANCED INCOME FUND SHARES AMOUNT
- --------------------------------------- ------- ---------
Shares sold ........................... 877 $ 8,039
Reinvestment of dividends ............. 233 2,153
Shares redeemed ....................... (3,661) (33,189)
------ --------
Net (decrease) in shares outstanding .. (2,551) $(22,997)
====== ========
INSTITUTIONAL CLASS INVESTOR CLASS
------------------- ---------------
INTERMEDIATE BOND FUND SHARES AMOUNT SHARES AMOUNT
- -------------------------------------- ------- --------- ------ ------
Shares sold .......................... 12,257 $124,721 39 $392
Reinvestment of dividends ............ 441 4,476 -- 1
Shares redeemed ...................... (6,186) (63,139) -- --
------ -------- --- ----
Net increase in shares outstanding ... 6,512 $ 66,058 39 $393
====== ======== === ====
53
AMERICAN BEACON FUNDS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2009 (UNAUDITED)
INSTITUTIONAL CLASS INVESTOR CLASS
------------------- -----------------
SHORT-TERM BOND FUND SHARES AMOUNT SHARES AMOUNT
- --------------------------------- ------- --------- ------ --------
Shares sold ..................... 3,180 $ 27,508 2,123 $18,391
Reinvestment of dividends ....... 580 5,019 23 200
Shares redeemed ................. (10,797) (93,562) (724) (6,272)
------- -------- ----- -------
Net increase (decrease) in shares
outstanding .................. (7,037) $(61,035) 1,422 $12,319
======= ======== ===== =======
PERIOD ENDED OCTOBER 31, 2008
INSTITUTIONAL CLASS INVESTOR CLASS AMR CLASS
------------------- ------------------ -----------------
HIGH YIELD BOND FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
- --------------------------------------- ------- --------- ------ --------- ------ --------
Shares sold ........................... 3,029 $ 28,128 2,332 $ 21,959 2,416 $ 22,523
Reinvestment of dividends ............. 645 5,835 193 1,751 639 5,778
Shares redeemed ....................... (5,867) (54,359) (3,309) (31,075) (4,693) (43,303)
------ -------- ------ -------- ------ --------
Net (decrease) in shares outstanding .. (2,193) $(20,396) (784) $ (7,365) (1,638) $(15,002)
====== ======== ====== ======== ====== ========
INVESTOR CLASS
-------------------
ENHANCED INCOME FUND SHARES AMOUNT
- ------------------------------------- ------- ---------
Shares sold ......................... 8,011 $ 79,277
Reinvestment of dividends ........... 714 7,127
Shares redeemed ..................... (6,812) (67,105)
------ --------
Net increase in shares outstanding .. 1,913 $ 19,299
====== ========
INSTITUTIONAL CLASS
-------------------
INTERMEDIATE BOND FUND SHARES AMOUNT
- ------------------------------------- ------- ---------
Shares sold ......................... 10,030 $103,092
Reinvestment of dividends ........... 695 7,052
Shares redeemed ..................... (6,232) (63,295)
------ --------
Net increase in shares outstanding .. 4,493 $ 46,849
====== ========
INSTITUTIONAL CLASS INVESTOR CLASS
------------------- ---------------
SHORT-TERM BOND FUND SHARES AMOUNT SHARES AMOUNT
- ------------------------------------- ------- --------- ------ ------
Shares sold ......................... 22,147 $193,487 816 $7,146
Reinvestment of dividends ........... 696 6,082 17 154
Shares redeemed ..................... (3,197) (27,969) (271) (2,372)
------ -------- ---- ------
Net increase in shares outstanding .. 19,646 $171,600 562 $4,928
====== ======== ==== ======
54
This page intentionally left blank.
55
AMERICAN BEACON HIGH YIELD BOND FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
-------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ----------------------------------------------------
2009 2008(A) 2007 2006(B) 2005 2004
----------- ------- -------- -------- -------- --------
(unaudited)
Net asset value, beginning of period ............. $ 6.77 $ 10.11 $ 10.20 $ 10.22 $ 10.86 $ 10.73
------- ------- -------- -------- -------- --------
Income from investment operations:
Net investment income ......................... 0.45 0.78 0.77 0.88 0.76 0.78
Net gains (losses) on securities (both realized
and unrealized) ............................ 0.26 (3.34) (0.09) 0.09 (0.84) 0.27
------- ------- -------- -------- -------- --------
Total income (loss) from investment operations ... 0.71 (2.56) 0.68 0.97 (0.08) 1.05
------- ------- -------- -------- -------- --------
Less distributions:
Dividends from net investment income .......... (0.45) (0.78) (0.77) (0.88) (0.76) (0.78)
Distributions from net realized gains on
securities ................................. -- -- -- (0.11) 0.20 (0.14)
------- ------- -------- -------- -------- --------
Total distributions .............................. (0.45) (0.78) (0.77) (0.99) (0.56) (0.92)
------- ------- -------- -------- -------- --------
Net asset value, end of period ................... $ 7.03 $ 6.77 $ 10.11 $ 10.20 $ 10.22 $ 10.86
======= ======= ======== ======== ======== ========
Total return ..................................... 11.12%(C) (27.03)% 6.85% 8.78% 3.03% 10.19%
======= ======= ======== ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) ...... $50,510 $62,138 $114,911 $231,693 $216,744 $241,777
Ratios to average net assets (annualized):
Expenses, net of waivers ...................... 0.82% 0.85% 0.85% 0.85% 0.84% 0.88%
Expenses, before waivers ...................... 0.82% 0.85% 0.86% 0.85% 0.84% 0.92%
Net investment income, net of waivers ......... 13.69% 8.38% 7.55% 7.55% 7.24% 7.27%
Net investment income, before waivers ......... 13.69% 8.38% 7.54% 7.55% 7.24% 7.23%
Portfolio turnover rate ....................... 70%(C) 157% 92% 88% 128% 138%
(A) On May 21, 2008, Post Advisory Group, LLC ceased managing a portion of the
High Yield Bond Fund and on May 22, 2008 Logan Circle Partners, L.P. began
managing a portion of the High Yield Bond Fund.
(B) Franklin Advisers, Inc. was added as an investment advisor to the High
Yield Bond Fund on September 12, 2006.
(C) Not annualized.
(D) Annualized.
(E) Portfolio turnover rate is for the period from November 1, 2006 through
October 31, 2007.
56
Investor Class AMR Class
- ---------------------------------------------------------------- -----------------------------------
Six Six
Months Months Year September
Ended Year Ended October 31, Ended Ended 04 to
April 30, -------------------------------------------------- April 30, October October
2009 2008(A) 2007 2006(B) 2005 2004 2009 31, 2008 31, 2007
- ----------- ------- ------- ------- -------- -------- ----------- -------- ---------
(unaudited) (unaudited)
$ 6.77 $ 10.11 $ 10.21 $ 10.22 $ 10.87 $ 10.73 $ 6.77 $ 10.11 $ 9.94
------- ------- ------- ------- -------- -------- ------- ------- -------
0.44 0.75 0.75 0.85 0.74 0.74 0.46 0.80 0.12
0.26 (3.34) (0.10) 0.10 (0.85) 0.28 0.25 (3.34) 0.17
------- ------- ------- ------- -------- -------- ------- ------- -------
0.70 (2.59) 0.65 0.95 (0.11) 1.02 0.71 (2.54) 0.29
------- ------- ------- ------- -------- -------- ------- ------- -------
(0.44) (0.75) (0.75) (0.85) (0.74) (0.74) (0.45) (0.80) (0.12)
-- -- -- (0.11) 0.20 (0.14) -- -- --
------- ------- ------- ------- -------- -------- ------- ------- -------
(0.44) (0.75) (0.75) (0.96) (0.54) (0.88) (0.45) (0.80) (0.12)
------- ------- ------- ------- -------- -------- ------- ------- -------
$ 7.03 $ 6.77 $ 10.11 $ 10.21 $ 10.22 $ 10.87 $ 7.03 $ 6.77 $ 10.11
======= ======= ======= ======= ======== ======== ======= ======= =======
10.96%(C) (27.24)% 6.52% 8.63% 2.69% 9.94% 11.25%(C) (26.84)% 2.94%(C)
======= ======= ======= ======= ======== ======== ======= ======= =======
$65,667 $13,949 $28,758 $80,284 $120,360 $148,266 $49,682 $44,060 $82,322
1.06% 1.10% 1.08% 1.08% 1.08% 1.20% 0.57% 0.58% 0.61%(D)
1.06% 1.10% 1.08% 1.08% 1.08% 1.20% 0.57% 0.58% 0.61%(D)
12.40% 8.06% 7.32% 7.33% 7.00% 6.95% 14.06% 8.64% 7.54%(D)
12.40% 8.06% 7.32% 7.33% 7.00% 6.95% 14.06% 8.64% 7.54%(D)
70%(C) 157% 92% 88% 128% 138% 70%(C) 157% 92%(E)
57
AMERICAN BEACON ENHANCED INCOME FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Investor Class
------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ----------------------------------------------------
2009 2008 2007 2006 2005 2004
----------- -------- ------- -------- -------- --------
(unaudited)
Net asset value, beginning of period ......... $ 8.80 $ 10.50 $ 10.25 $ 9.98 $ 10.16 $ 9.96
------- -------- ------- -------- -------- --------
Income from investment operations:
Net investment income ..................... 0.62 0.41 0.36 0.33 0.29 0.26
Net gains (losses) on securities (both
realized and unrealized) ............... 0.22 (1.39) 0.32 0.29 (0.16) 0.20
------- -------- ------- -------- -------- --------
Total income (loss) from investment operations 0.84 (0.98) 0.68 0.62 0.13 0.46
------- -------- ------- -------- -------- --------
Less distributions:
Dividends from net investment income ...... (0.19) (0.49) (0.42) (0.35) (0.31) (0.26)
Distributions from net realized gains on
securities ............................. -- (0.23) (0.01) -- -- --
------- -------- ------- -------- -------- --------
Total distributions .......................... (0.19) (0.72) (0.43) (0.35) (0.31) (0.26)
------- -------- ------- -------- -------- --------
Net asset value, end of period ............... $ 9.45 $ 8.80 $ 10.50 $ 10.25 $ 9.98 $ 10.16
======= ======== ======= ======== ======== ========
Total return ................................. 10.09%(A) (10.02)% 6.75% 6.36% 1.32% 4.70%
======= ======== ======= ======== ======== ========
Ratios and supplemental data:
Net assets, end of period (in thousands) .. $83,755 $100,469 $99,789 $125,915 $112,341 $103,897
Ratios to average net assets (annualized):
Expenses .................................. 0.95% 0.92% 0.94% 0.93% 0.92% 1.00%
Net investment income ..................... 4.23% 3.64% 3.69% 3.21% 2.79% 2.54%
Portfolio turnover rate ................... 21%(A) 76% 103% 65% 41% 72%
(A) Not annualized.
58
AMERICAN BEACON INTERMEDIATE BOND FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class (formerly AMR Class prior to 3/1/05) Investor
---------------------------------------------------------------- Class
Six Months Year Ended October 31, March 2 to
Ended April ------------------------------------------------- April 30,
30, 2009 2008 2007 2006 2005(A) 2004 2009
------------ -------- -------- ------- ------- ------- ------------
(unaudited) (unaudited)
Net asset value, beginning of period ............ $ 9.61 $ 10.10 $ 10.02 $ 10.01 $ 10.33 $ 10.24 $10.14
-------- -------- -------- ------- ------- ------- ------
Income from investment operations:
Net investment income ........................ 0.24 0.50 0.50 0.46 0.42 0.40 0.06
Net gains (losses) on securities (both
realized and unrealized) .................. 0.58 (0.51) 0.07 0.02 (0.29) 0.14 0.07
-------- -------- -------- ------- ------- ------- ------
Total income (loss) from investment operations .. 0.82 (0.01) 0.57 0.48 0.13 0.54 0.13
-------- -------- -------- ------- ------- ------- ------
Less distributions:
Dividends from net investment income ......... (0.22) (0.48) (0.49) (0.47) (0.45) (0.45) (0.06)
Distributions from net realized gains on
securities ................................ -- -- -- -- -- -- --
-------- -------- -------- ------- ------- ------- ------
Total distributions ............................. (0.22) (0.48) (0.49) (0.47) (0.45) (0.45) (0.06)
-------- -------- -------- ------- ------- ------- ------
Net asset value, end of period .................. $ 10.21 $ 9.61 $ 10.10 $ 10.02 $ 10.01 $ 10.33 $10.21
======== ======== ======== ======= ======= ======= ======
Total return .................................... 8.56%(B) (0.26)% 5.83% 4.96% 1.26% 5.38% 1.28%(B)
======== ======== ======== ======= ======= ======= ======
Ratios and supplemental data:
Net assets, end of period (in thousands) ..... $223,331 $147,634 $109,674 $97,319 $93,270 $96,242 $ 393
Ratios to average net assets (annualized):
Expenses, net of waivers ..................... 0.30% 0.30% 0.34% 0.35% 0.31% 0.34% 0.64%
Expenses, before waivers ..................... 0.30% 0.30% 0.34% 0.35% 0.31% 0.34% 2.39%
Net investment income, net of waivers ........ 4.27% 4.70% 4.86% 4.64% 4.12% 3.97% 3.41%
Net investment income, before waivers ........ 4.27% 4.70% 4.86% 4.64% 4.12% 3.97% 1.66%
Portfolio turnover rate ...................... 94%(B) 105% 85% 122% 119% 106% 94%(B, C)
(A) On March 1, 2005, the existing Institutional Class shares were terminated
and exchanged for AMR Class shares at a conversion rate of 1.0202.
Following this exchange, the former AMR Class Shares were re-named
Institutional Class.
(B) Not annualized.
(C) Portfolio turnover rate is for the period from November 1, 2008 through
April 30, 2009.
59
AMERICAN BEACON SHORT-TERM BOND FUND
FINANCIAL HIGHLIGHTS
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)
Institutional Class
---------------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ------------------------------------------------------
2009 2008 2007 2006 2005(A) 2004
------------ -------- ------- ------- ------- -------
(unaudited)
Net asset value, beginning of period ............ $ 8.58 $ 8.79 $ 8.74 $ 8.75 $ 9.07 $ 9.31
-------- -------- ------- ------- ------- -------
Income from investment operations:
Net investment income ........................ 0.10(B) 0.35(B) 0.39(B) 0.32(B) 0.29 0.27
Net gains (losses) on securities (both
realized and unrealized) .................. 0.15 (0.15) 0.09 0.07 (0.20) (0.05)
-------- -------- ------- ------- ------- -------
Total income (loss) from investment operations .. 0.25 0.20 0.48 0.39 0.09 0.22
-------- -------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income ......... (0.16) (0.41) (0.43) (0.40) (0.41) (0.46)
Distributions from net realized gains on
securities ................................ -- -- -- -- -- --
-------- -------- ------- ------- ------- -------
Total distributions ............................. (0.16) (0.41) (0.43) (0.40) (0.41) (0.46)
-------- -------- ------- ------- ------- -------
Net asset value, end of period .................. $ 8.67 $ 8.58 $ 8.79 $ 8.74 $ 8.75 $ 9.07
======== ======== ======= ======= ======= =======
Total return .................................... 2.96%(C) 2.21% 5.61% 4.56% 1.00% 2.39%
======== ======== ======= ======= ======= =======
Ratios and supplemental data:
Net assets, end of period (in thousands) ..... $197,529 $255,725 $89,427 $73,417 $79,683 $80,504
Ratios to average net assets (annualized):
Expenses, net of waivers ..................... 0.30% 0.31% 0.37% 0.35% 0.33% 0.33%
Expenses, before waivers ..................... 0.30% 0.31% 0.37% 0.35% 0.33% 0.33%
Net investment income, net of waivers ........ 2.56% 3.75% 4.48% 3.64% 3.15% 3.00%
Net investment income, before waivers ........ 2.56% 3.75% 4.48% 3.64% 3.15% 3.00%
Portfolio turnover rate ...................... 84%(C) 21% 40% 48% 38% 41%
(A) On March 1, 2005, the existing Institutional Class shares were terminated
and exchanged for AMR Class shares at a conversion rate of 1.0014.
Following this exchange, the former AMR Class Shares were re-named
Institutional Class.
(B) For purposes of this calculation, the change in undistributed net
investment income per share was derived by dividing the change in
undistributed net investment income by average shares outstanding for the
period.
(C) Not annualized.
60
Investor Class
- --------------------------------------------------------------
Six
Months
Ended Year Ended October 31,
April 30, ------------------------------------------------
2009 2008 2007 2006 2005 2004
- ----------- ------ ------ ------ ------ ------
(unaudited)
$ 8.59 $ 8.81 $ 8.76 $ 8.77 $ 9.09 $ 9.33
- ------- ------ ------ ------ ------ ------
0.11(B) 0.29(B) 0.35(B) 0.27(B) 0.28 0.25
0.13 (0.15) 0.09 0.07 (0.24) (0.07)
- ------- ------ ------ ------ ------ ------
0.24 0.14 0.44 0.34 0.04 0.18
- ------- ------ ------ ------ ------ ------
(0.15) (0.36) (0.39) (0.35) (0.36) (0.42)
-- -- -- -- -- --
- ------- ------ ------ ------ ------ ------
(0.15) (0.36) (0.39) (0.35) (0.36) (0.42)
- ------- ------ ------ ------ ------ ------
$ 8.68 $ 8.59 $ 8.81 $ 8.76 $ 8.77 $ 9.09
======= ====== ====== ====== ====== ======
2.84%(C) 1.54% 5.08% 4.01% 0.46% 1.84%
======= ====== ====== ====== ====== ======
$20,170 $7,733 $2,976 $7,189 $8,582 $7,781
0.54% 0.85% 0.87% 0.88% 0.87% 0.87%
0.80% 0.88% 0.98% 0.90% 0.94% 0.87%
2.18% 3.19% 3.91% 3.10% 2.59% 2.44%
1.92% 3.16% 3.81% 3.08% 2.52% 2.44%
84%(C) 21% 40% 48% 38% 41%
61
RESULTS OF SHAREHOLDER MEETING (UNAUDITED)
A special meeting of shareholders of the American Beacon Balanced Fund and
the American Beacon Enhanced Income Fund (each a "Fund") of the American Beacon
Funds (the "Trust") was held on February 13, 2009. The shareholders of the Funds
were asked to vote on a proposal to approve and ratify an advisory fee under the
current Investment Management Agreement between American Beacon Advisors, Inc.
(the "Manager") and the Funds (the "Investment Management Agreement.")
Shareholders previously approved the Investment Management Agreement at a
special meeting held on August 22, 2008 in connection with the change of control
of the Manager. The proxy statement provided to shareholders in connection with
that meeting accurately disclosed that there were no proposed changes to the
total aggregate fees payable to the Manager for management, advisory, securities
lending and administrative services provided to the Funds. However, the advisory
fee had been inadvertently omitted from the fee schedule to the form of the
Investment Management Agreement and comparative fee table included as appendices
to the proxy statement provided to shareholders in connection with that meeting.
This proposal required a majority of shareholders of each Fund to achieve a
quorum.
The shareholders of the Funds passed the vote with the following results:
FUND FOR AGAINST ABSTAIN NON-VOTING
- --------------- -------------- ------------ --------- ----------
Balanced 601,896,430.17 1,636,527.29 71,959.48 -0-
Enhanced Income 83,387,906.04 24,152.10 -0- -0-
62
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63
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64
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65
(AMERICAN BEACON FUNDS(R) LOGO)
DELIVERY OF DOCUMENTS
To reduce expenses, your financial institution may mail only one copy of the
Prospectus, Annual Report and Semi-Annual Report to those addresses shared by
two or more accounts. If you wish to receive individual copies of these
documents, please contact your financial institution. Delivery of individual
copies will commence thirty days after receiving your request.
If you invest in the Fund through a financial institution, you may be able to
receive the Fund's regulatory mailings, such as the Prospectus, Annual Report
and Semi-Annual Report, by e-mail. If you are interested in this option, please
go to www.icsdelivery.com and search for your financial institution's name or
contact your financial institution directly.
TO OBTAIN MORE INFORMATION ABOUT THE FUND:
(GRAPHIC)
BY E-MAIL:
american_beacon.funds@ambeacon.com
(GRAPHIC)
BY TELEPHONE:
Institutional Class
Call (800) 658-5811
AMR Class(SM)
Call (800) 345-2345
Investor Class(R) Class
Call (800) 388-3344
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
In addition to the Schedule of Investments provided in each semi-annual and
annual report, the Fund files a complete schedule of its portfolio holdings with
the Securities and Exchange Commission ("SEC") on Form N-Q as of the first and
third fiscal quarters. The Fund's Forms N-Q are available on the SEC's website
at www.sec.gov. The Forms N-Q may also be reviewed and copied at the SEC's
Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549. Information
regarding the operation of the SEC's Public Reference Room may be obtained by
calling 1-800-SEC-0330. A complete schedule of the Fund's portfolio holdings is
also available on the Funds' website (www.americanbeaconfunds.com) approximately
thirty days after the end of each month.
(GRAPHIC)
ON THE INTERNET:
Visit our website at www.americanbeaconfunds.com
(GRAPHIC)
BY MAIL:
American Beacon Funds
P.O. Box 219643
Kansas City, MO 64121-9643
AVAILABILITY OF PROXY VOTING POLICY AND RECORDS
A description of the policies and procedures the Fund uses to determine how to
vote proxies relating to portfolio securities is available in the Fund's
Statement of Additional Information, is available free of charge on the Fund's
website (www.americanbeaconfunds.com) and by calling 1-800-967-9009 or by
accessing the SEC's website at www.sec.gov. The Fund's proxy voting record for
the most recent year ended June 30 is filed annually with the SEC on Form N-PX.
The Fund's Forms N-PX are available on the SEC's website at www.sec.gov. The
Fund's proxy voting record may also be obtained by calling 1-800-967-9009.
FUND SERVICE PROVIDERS:
CUSTODIAN
STATE STREET BANK AND TRUST
Boston, Massachusetts
TRANSFER AGENT
BOSTON FINANCIAL DATA SERVICES
Kansas City, Missouri
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
ERNST & YOUNG LLP
Dallas, Texas
DISTRIBUTOR
FORESIDE FUND SERVICES
Portland, Maine
This report is prepared for shareholders of the American Beacon Funds and may be
distributed to others only if preceded or accompanied by a current prospectus.
American Beacon Funds, American Beacon High Yield Bond Fund, American Beacon
Enhanced Income Fund, American Beacon Intermediate Bond and American Beacon
Short-Term Bond Fund are service marks of American Beacon Advisors, Inc.
SAR 04/09
00068037
ITEM 2. CODE OF ETHICS.
The Trust did not amend the code of ethics that applies to its principal
executive and financial officers (the "Code") nor did it grant any waivers to
the provisions of the Code during the period covered by the shareholder reports
presented in Item 1.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not Applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not Applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
The schedules of investments for each series of the Trust are included in the
shareholder reports presented in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Trust has made no material changes to the procedures by which shareholders
may recommend nominees to the Trust's Board of Trustees since the Trust last
disclosed such procedures in Schedule 14A.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based upon an evaluation within 90 days of the filing date of this
report, the principal executive and financial officers concluded that
the disclosure controls and procedures of the Trust are effective.
(b) There were no changes in the Trust's internal control over financial
reporting during the second fiscal quarter of the period covered by
this report that has materially affected, or is reasonably likely to
materially affect, the Trust's internal control over financial
reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the Trust as required by Rule
30a-2(a) under the Investment Company Act of 1940 is attached hereto
as EX-99.CERT.
(a)(3) Not applicable.
(b) The certifications required by Rule 30a-2(b) under the Investment
Company Act of 1940 are attached hereto as EX-99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): American Beacon Funds
By /s/ William F. Quinn
--------------------
William F. Quinn
President
Date: July 7, 2009
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on
the dates indicated.
By /s/ William F. Quinn
--------------------
William F. Quinn
President
Date: July 7, 2009
By /s/ Rebecca L. Harris
---------------------
Rebecca L. Harris
Treasurer
Date: July 7, 2009