UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-08327
Name of Fund: Merrill Lynch Global Growth Fund, Inc.
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Robert C. Doll, Jr., Chief Executive
Officer, Merrill Lynch Global Growth Fund, Inc., 800 Scudders Mill Road,
Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton,
NJ, 08543-9011
Registrant's telephone number, including area code: (609) 282-2800
Date of fiscal year end: 08/31/05
Date of reporting period: 09/01/04 - 08/31/05
Item 1 - Report to Stockholders
Merrill Lynch
Global Growth
Fund, Inc.
Annual Report
August 31, 2005
(BULL LOGO) Merrill Lynch Investment Managers
www.mlim.ml.com
Mercury Advisors
A Division of Merrill Lynch Investment Managers
www.mercury.ml.com
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy shares of the Fund unless accompanied or preceded by the
Fund's current prospectus. Past performance results shown in this report
should not be considered a representation of future performance. Investment
return and principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost. Statements and
other information herein are as dated and are subject to change.
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available (1) without
charge, upon request, by calling toll-free 1-800-MER-FUND (1-800-637-3863);
(2) at www.mutualfunds.ml.com and (3) on the Securities and Exchange
Commission's Web site at http://www.sec.gov. Information about how the
Fund voted proxies relating to securities held in the Fund's portfolio
during the most recent 12-month period ended June 30 is available (1) at
www.mutualfunds.ml.com and (2) on the Securities and Exchange Commission's
Web site at http://www.sec.gov.
Merrill Lynch Global Growth Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
(GO PAPERLESS LOGO)
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To sign up today, go to www.icsdelivery.com/live.
Merrill Lynch Global Growth Fund, Inc.
Portfolio Information as of August 31, 2005
Country of Percent of
Ten Largest Equity Holdings Origin Net Assets
Exxon Mobil Corp. United States 3.0%
Hyundai Motor Co. South Korea 2.6
Macquarie Bank Ltd. Australia 2.5
National Australia Bank Ltd. Australia 2.4
Porsche AG (Preferred) Germany 2.3
Sanofi-Aventis France 2.0
3M Co. United States 2.0
LVMH Moet Hennessy Louis
Vuitton SA France 1.9
Commonwealth Bank of
Australia Australia 1.9
QBE Insurance Group Ltd. Australia 1.8
Percent of
Five Largest Industries Net Assets
Commercial Banks 9.8%
Oil, Gas & Consumable Fuels 7.6
Automobiles 6.4
Energy Equipment & Services 4.9
Health Care Equipment & Supplies 4.8
For Fund compliance purposes, the Fund's industry classifications
refer to any one or more of the industry sub-classifications used
by one or more widely recognized market indexes or ratings group
indexes, and/or as defined by Fund management. This definition
may not apply for purposes of this report, which may combine
industry sub-classifications for reporting ease.
Percent of
Geographic Allocation Total
by Country Investments
United States 27.3%
Australia 20.2
India 8.7
Japan 8.1
Hong Kong 6.2
France 5.0
South Korea 4.4
Switzerland 3.3
Germany 2.9
South Africa 2.2
Sweden 2.1
Spain 2.1
Canada 2.1
United Kingdom 1.7
China 1.2
Singapore 0.3
Other* 2.2
* Includes portfolio holdings in short-term investments.
Important Tax Information
The following information is provided with respect to the ordinary income
distribution paid by Merrill Lynch Global Growth Fund, Inc. to shareholders of
record on December 13, 2004:
Qualified Dividend Income for Individuals 100%
Dividends Qualifying for the Dividend Received Deduction for Corporations 100%
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
A Letter From the President
Dear Shareholder
Amid what we've coined a "muddle through" year for the financial markets, the
major market benchmarks managed to post positive results for the current
reporting period:
Total Returns as of August 31, 2005 6-month 12-month
U.S. equities (Standard & Poor's 500 Index) +2.33% +12.56%
Small-cap U.S. equities (Russell 2000 Index) +5.75% +23.10%
International equities (MSCI Europe Australasia Far East Index) +1.98% +23.58%
Fixed income (Lehman Brothers Aggregate Bond Index) +2.85% + 4.15%
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index) +2.85% + 5.31%
High yield bonds (Credit Suisse First Boston High Yield Index) +1.35% + 8.98%
Since June 2004, the Federal Reserve Board (the Fed) has tirelessly advanced
its interest rate-hiking program, bringing the federal funds rate to 3.5%
by August 31 (and to 3.75% on September 20). Economists and investors have
struggled to project the Fed's future moves, vacillating from expectations for
an impending end to monetary tightening to fears that the central bank may
increase interest rates more than is necessary to moderate economic growth and
keep inflation in check. Most recently, the devastation of Hurricane Katrina
added a new element of ambiguity in terms of its impact on the economy and Fed
sentiment. Many now believe the Fed will suspend its interest rate-hiking
campaign at some point this year.
Equity market returns over the past several months have reflected a degree of
investor uncertainty. After a strong finish to 2004, the S&P 500 Index posted
gains in four of the first eight months of 2005. Up to this point, strong
corporate earnings reports and low long-term bond yields have worked in favor
of equities. Factors that pose the greatest risks to stocks include record-
high oil prices, continued interest rate hikes and the possibility for
disappointing earnings for the remainder of the year.
Fixed income markets have fared relatively well in the face of monetary
tightening. As the short end of the yield curve moved in concert with Fed
interest rate hikes, long-term bond yields remained low, perpetuating the
yield curve flattening trend. Because bond prices move in the opposite
direction of yields, the result has been that longer-term bonds have
outperformed short-term bonds. At period end, the spread between two-year and
10-year Treasury yields was just 18 basis points (.18%).
Financial markets are likely to face continued crosscurrents for the remainder
of 2005, particularly as the economy digests the impact of Hurricane Katrina.
Nevertheless, opportunities do exist and we encourage you to work with your
financial advisor to diversify your portfolio among a variety of asset types.
This can help to diffuse risk while also tapping into the potential benefits
of a broader range of investment alternatives. As always, we thank you for
trusting Merrill Lynch Investment Managers with your investment assets.
Sincerely,
(Robert C. Doll, Jr.)
Robert C. Doll, Jr.
President and Director
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
A Discussion With Your Fund's Portfolio Manager
The Fund significantly outperformed both its benchmark and its Lipper category
average for the fiscal year, benefiting from favorable geographic and sector
weightings as well as good stock selection.
How did the Fund perform during the fiscal year in light of the existing
market conditions?
For the 12-month period ended August 31, 2005, Merrill Lynch Global Growth
Fund, Inc.'s Class A, Class B, Class C, Class I and Class R Shares had total
returns of +25.17%, +24.18%, +24.18%, +25.58% and +24.81%, respectively. (Fund
results shown do not reflect sales charges and would be lower if sales charges
were included. Complete performance information can be found on pages 6 - 8 of
this report to shareholders.) The Fund outperformed the +18.11% return of the
benchmark Morgan Stanley Capital International (MSCI) World Index and the
+18.90% average return of the Lipper Global Large Cap Growth Funds category
for the same time period. (Funds in this Lipper category invest primarily in
equity securities both inside and outside the United States with relatively
large market capitalizations and a focus on above-average growth.)
The global equity, bond and commodity markets, as well as the major currency
relationships, were relatively volatile during the fiscal year. The best
equity market returns were realized outside the United States and Japan. The
Fund had no exposure to Japanese equities until the last week of the fiscal
year and was underweight in the U.S. stock market relative to the MSCI World
Index. The most significant underweighting took place after the U.S. dollar
appreciated by more than 12% relative to the euro between late December 2004
and late June 2005. At that time, we shifted more assets primarily into
existing investments in the non-Japan Asian stock markets, with Australia
being the largest investment exposure. Since making that shift, the U.S.
dollar has depreciated in value relative to both the euro and the Australian
dollar.
During the fiscal year, the Fund enjoyed relatively high total returns from
its investments in the major non-Japan Asian markets, such as South Korea,
India, Hong Kong and South Africa. Overweight positions in the consumer
discretionary, energy, industrials and health care sectors, as well as the
overweighting of specific stocks in these sectors, proved most important in
the Fund's outperformance.
Leading performers in the consumer discretionary sector were Hyundai Motor Co.
(South Korea), Esprit Holdings Ltd. (Hong Kong), Station Casinos, Inc., Best
Buy Co., Inc., eBay Inc., Porsche AG (Germany) and TechTronic Industries Co.
Ltd. (Hong Kong). In the energy sector, the leading contributors to absolute
and relative performance were Transocean, Inc., Cameco Corp., Sasol Ltd.
(South Africa), S-Oil Corp. (South Korea), Frontline Ltd. of Norway
(headquartered in Bermuda), Suncor Energy Inc. (Canada), National Oilwell
Varco, Inc., Diamond Offshore Drilling, Inc., Grant Prideco, Inc. and Petroleo
Brasileiro S/A (Brazil).
In the industrials sector, top performers were ACS Actividades de Construccion
y Servicios, SA (Spain), Boeing Co., PACCAR Inc., SKF AB (Sweden), Wesfarmers
Ltd. (Australia), Daewoo Shipbuilding & Marine Engineering Co., Ltd. (South
Korea), Larsen & Toubro Ltd. (India), Lockheed Martin Corp. and Toll Holdings
Ltd. (Australia). Industrials stocks that detracted from performance included
3M Co. and Deere & Co. We sold our position in Deere & Co. after business
conditions in the United States and Europe deteriorated due to drought
conditions.
In the health care sector, the largest contributors to Fund results were
Alcon, Inc. (Switzerland), Gilead Sciences, Inc., Celgene Corp., Cochlear Ltd.
(Australia) and Amgen, Inc. The only meaningful detractors from sector
performance were Boston Scientific Corp. and Elan Corp. Plc (Ireland). Both
positions were liquidated based on the companies' deteriorating business
fundamentals and growth prospects.
A final factor that aided performance was our underweight position in the
information technology (IT) sector during the second half of the fiscal year.
Several IT stocks had actually benefited Fund performance in the first half of
the fiscal year. These included Adobe Systems Inc., Samsung Electronics Co.
Ltd. (South Korea) and Electronic Arts Inc.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
What changes were made to the portfolio during the period?
In the first half of the fiscal year, as outlined in the semi-annual report to
shareholders dated February 28, 2005, we reduced the portfolio's exposure to
companies in the consumer discretionary, IT, materials and energy sectors
while increasing exposure to financials for the first time in several years.
The most significant changes in the portfolio during the second half of the
year took place in the last week of August 2005. We shifted assets from the
U.K. and U.S. stock markets to the Japanese stock market, ending the period
with an approximate 8% weighting in Japan. We made this shift based on what
appears to be a meaningful improvement in the real and nominal growth
prospects for the domestic economy in Japan. As a result of the investment in
Japanese equities, the Fund's exposure to the consumer discretionary sector
grew to an overweight. Among the Japanese companies added to the portfolio
were Toyota Motor Corp., Isuzu Motors Ltd., Nippon Oil Corp., Matsushita
Electric Works Ltd. and Sumitomo Mitsui Financial Group, Inc.
Also in the second half of the fiscal year, we increased exposure to the
energy sector and decreased the Fund's weighting in financials. In energy, we
created an overweight position with the addition of Exxon Mobil Corp. and
Sunoco, Inc.
Finally, we trimmed the Fund's exposure to the health care sector and
approached a weighting equal to the MSCI World Stock Index. Specifically, we
liquidated the portfolio's positions in Johnson & Johnson, UnitedHealth Group,
Inc., WellPoint, Inc., Caremark Rx, Inc., Boston Scientific and St. Jude
Medical, Inc.
How would you characterize the Fund's position at the close of the period?
We believe the Fund is positioned to benefit from what appears to be an
emerging recovery in real and nominal economic growth rates in the major Asian
economies, including Japan. At the end of August 2005, approximately 50% of
the value of the Fund's investments was in the equity markets of Australia,
Japan, India, Hong Kong, South Korea, South Africa, China and Singapore. We
believe the companies we have selected in these markets should provide above-
average growth in revenues, earnings and rates of return in the coming
quarters as the Chinese economy is likely to continue to exhibit above-average
growth, pulling along other economies in the Asia-Pacific region. Also, if the
Japanese economy continues to show signs of faster growth in domestic consumer
spending, it can be a powerful force in regional economic growth. In our
opinion, the elevated global energy prices partly reflect the strong demand
for energy from China so far in 2005.
In the United States, the economy appears to be experiencing a continued
slowdown in consumer demand for motor vehicles, housing and related electronic
and durable goods. The higher gasoline and other energy prices may be causing
consumers to tighten their budgets to pay energy bills. In addition, U.S.
monetary authorities appear to be continuing to reduce the availability of
residential real estate-related financing, which would tend to put downward
pressure on the rate of growth in consumer spending. European business and
consumer market conditions appear to be lackluster across the board, with
official economic recessions apparent in the Netherlands and Italy.
Consequently, the Fund remains underweight relative to the MSCI World Index
in the U.S. and European markets.
Lawrence R. Fuller
Vice President and Portfolio Manager
September 15, 2005
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Performance Data
About Fund Performance
Investors are able to purchase shares of the Fund through multiple pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end load) of 5.25%
and an account maintenance fee of 0.25% per year (but no distribution fee).
* Class B Shares are subject to a maximum contingent deferred sales charge of
4% declining to 0% after six years. In addition, Class B Shares are subject to
a distribution fee of 0.75% per year and an account maintenance fee of 0.25%
per year. These shares automatically convert to Class A Shares after
approximately eight years. (There is no initial sales charge for automatic
share conversions.) All returns for periods greater than eight years reflect
this conversion.
* Class C Shares are subject to a distribution fee of 0.75% per year and an
account maintenance fee of 0.25% per year. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within one year
of purchase.
* Class I Shares incur a maximum initial sales charge (front-end load) of
5.25% and bear no ongoing distribution or account maintenance fees. Class I
Shares are available only to eligible investors.
* Class R Shares do not incur a maximum sales charge (front-end load) or
deferred sales charge. These shares are subject to a distribution fee of 0.25%
per year and an account maintenance fee of 0.25% per year. Class R Shares are
available only to certain retirement plans. Prior to inception, Class R Share
performance results are those of Class I Shares (which have no distribution or
account maintenance fees) restated for Class R Share fees.
None of the past results shown should be considered a representation of future
performance. Current performance may be lower or higher than the performance
data quoted. Refer to www.mlim.ml.com to obtain performance data current to
the most recent month-end. Performance results do not reflect the deduction of
taxes that a shareholder would pay on fund distributions or the redemption of
fund shares. The Fund may charge a 2% redemption fee for sales or exchanges of
shares within 30 days of purchase. Performance data does not reflect this
potential fee. Figures shown in each of the following tables assume
reinvestment of all dividends and capital gain distributions, if any, at net
asset value on the ex-dividend date. Investment return and principal value of
shares will fluctuate so that shares, when redeemed, may be worth more or less
than their original cost. Dividends paid to each class of shares will vary
because of the different levels of account maintenance, distribution and
transfer agency fees applicable to each class, which are deducted from the
income available to be paid to shareholders.
Recent Performance Results
6-Month 12-Month Since Inception
As of August 31, 2005 Total Return Total Return Total Return
ML Global Growth Fund, Inc.--Class A Shares* +4.43% +25.17% +32.05%
ML Global Growth Fund, Inc.--Class B Shares* +3.99 +24.18 +24.21
ML Global Growth Fund, Inc.--Class C Shares* +3.99 +24.18 +24.13
ML Global Growth Fund, Inc.--Class I Shares* +4.59 +25.58 +34.64
ML Global Growth Fund, Inc.--Class R Shares* +4.30 +24.81 +30.87
MSCI World Index** +2.68 +18.11 +46.33
* Investment results shown do not reflect sales charges; results shown would be lower if a sales charge
was included. Cumulative total investment returns are based on changes in net asset values for the
periods shown, and assume reinvestment of all dividends and capital gains distributions at net asset
value on the ex-dividend date. The Fund's inception date is 10/31/97.
** This unmanaged market capitalization-weighted Index is comprised of a representative sampling of large-,
medium- and small-capitalization companies in 22 countries, including the United States. Since inception
total returns are from 10/31/97.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Performance Data (continued)
TOTAL RETURN BASED ON A $10,000 INVESTMENT
Class A & Class B Shares
A line graph illustrating the growth of a $10,000 investment in ML Global
Growth Fund, Inc.++ Class A and Class B Shares* compared to a similar
investment in MSCI World Index++++. Values illustrated are as follows:
ML Global Growth Fund, Inc.++
Class A Shares*
Date Value
10/31/1997** $ 9,475.00
August 1998 $10,186.00
August 1999 $13,059.00
August 2000 $18,437.00
August 2001 $11,140.00
August 2002 $ 8,202.00
August 2003 $ 8,863.00
August 2004 $ 9,996.00
August 2005 $12,511.00
ML Global Growth Fund, Inc.++
Class B Shares*
Date Value
10/31/1997** $10,000.00
August 1998 $10,680.00
August 1999 $13,592.00
August 2000 $19,035.00
August 2001 $11,419.00
August 2002 $ 8,341.00
August 2003 $ 8,940.00
August 2004 $10,002.00
August 2005 $12,421.00
MSCI World Index++++
Date Value
10/31/1997** $10,000.00
August 1998 $10,390.00
August 1999 $13,823.00
August 2000 $15,638.00
August 2001 $11,668.00
August 2002 $ 9,661.00
August 2003 $10,716.00
August 2004 $12,390.00
August 2005 $14,633.00
* Assuming maximum sales charge, transaction costs and other operating
expenses, including advisory fees.
** Commencement of operations.
++ ML Global Growth Fund, Inc. invests primarily in equity securities with a
particular emphasis on companies that have exhibited above-average growth
rates in earnings.
++++ This unmanaged market capitalization-weighted Index is comprised of a
representative sampling of large-, medium- and small-capitalization
companies in 22 countries, including the United States.
Past performance is not predictive of future results.
Average Annual Total Return
Return Without Return With
Sales Charge Sales Charge**
Class A Shares*
One Year Ended 8/31/05 +25.17% +18.60%
Five Years Ended 8/31/05 - 7.46 - 8.45
Inception (10/31/97)
through 8/31/05 + 3.61 + 2.90
* Maximum sales charge is 5.25%.
** Assuming maximum sales charge.
Return Return
Without CDSC With CDSC**
Class B Shares*
One Year Ended 8/31/05 +24.18% +20.18%
Five Years Ended 8/31/05 - 8.18 - 8.51
Inception (10/31/97)
through 8/31/05 + 2.81 + 2.81
* Maximum contingent deferred sales charge is 4% and is reduced
to 0% after six years.
** Assuming payment of applicable contingent deferred sales
charge.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Performance Data (concluded)
TOTAL RETURN BASED ON A $10,000 INVESTMENT
Class C, Class I & Class R Shares
A line graph illustrating the growth of a $10,000 investment in ML Global
Growth Fund, Inc.++ Class C, Class I and Class R Shares* compared to a similar
investment in MSCI World Index++++. Values illustrated are as follows:
ML Global Growth Fund, Inc.++
Class C Shares*
Date Value
10/31/1997** $10,000.00
August 1998 $10,680.00
August 1999 $13,588.00
August 2000 $19,030.00
August 2001 $11,425.00
August 2002 $ 8,337.00
August 2003 $ 8,935.00
August 2004 $ 9,997.00
August 2005 $12,413.00
ML Global Growth Fund, Inc.++
Class I Shares*
Date Value
10/31/1997** $ 9,475.00
August 1998 $10,214.00
August 1999 $13,121.00
August 2000 $18,562.00
August 2001 $11,251.00
August 2002 $ 8,307.00
August 2003 $ 8,996.00
August 2004 $10,159.00
August 2005 $12,758.00
ML Global Growth Fund, Inc.++
Class R Shares*
Date Value
10/31/1997** $10,000.00
August 1998 $10,735.00
August 1999 $13,722.00
August 2000 $19,317.00
August 2001 $11,648.00
August 2002 $ 8,558.00
August 2003 $ 9,269.00
August 2004 $10,485.00
August 2005 $13,087.00
MSCI World Index++++
Date Value
10/31/1997** $10,000.00
August 1998 $10,390.00
August 1999 $13,823.00
August 2000 $15,638.00
August 2001 $11,668.00
August 2002 $ 9,661.00
August 2003 $10,716.00
August 2004 $12,390.00
August 2005 $14,633.00
* Assuming maximum sales charge, transaction costs and other operating
expenses, including advisory fees.
** Commencement of operations.
++ ML Global Growth Fund, Inc. invests primarily in equity securities with a
particular emphasis on companies that have exhibited above-average growth
rates in earnings.
++++ This unmanaged market capitalization-weighted Index is comprised of a
representative sampling of large-, medium- and small-capitalization
companies in 22 countries, including the United States.
Past performance is not predictive of future results.
Average Annual Total Return
Return Return
Without CDSC With CDSC**
Class C Shares*
One Year Ended 8/31/05 +24.18% +23.18%
Five Years Ended 8/31/05 - 8.19 - 8.19
Inception (10/31/97)
through 8/31/05 + 2.80 + 2.80
* Maximum contingent deferred sales charge is 1% and is reduced
to 0% after one year.
** Assuming payment of applicable contingent deferred sales
charge.
Return Without Return With
Sales Charge Sales Charge**
Class I Shares*
One Year Ended 8/31/05 +25.58% +18.99%
Five Years Ended 8/31/05 - 7.23 - 8.22
Inception (10/31/97)
through 8/31/05 + 3.87 + 3.16
* Maximum sales charge is 5.25%.
** Assuming maximum sales charge.
Class R Shares Return
One Year Ended 8/31/05 +24.81%
Five Years Ended 8/31/05 - 7.49
Inception (10/31/97)
through 8/31/05 + 3.49
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Disclosure of Expenses
Shareholders of this Fund may incur the following charges: (a) expenses
related to transactions, including sales charges, redemption fees and exchange
fees; and (b) operating expenses including advisory fees, distribution fees
including 12(b)-1 fees, and other Fund expenses. The following example (which
is based on a hypothetical investment of $1,000 invested on March 1, 2005 and
held through August 31, 2005) is intended to assist shareholders both in
calculating expenses based on an investment in the Fund and in comparing these
expenses with similar costs of investing in other mutual funds.
The first table below provides information about actual account values and
actual expenses. In order to estimate the expenses a shareholder paid during
the period covered by this report, shareholders can divide their account value
by $1,000 and then multiply the result by the number in the first line under
the heading entitled "Expenses Paid During the Period."
The second table below provides information about hypothetical account values
and hypothetical expenses based on the Fund's actual expense ratio and an
assumed rate of return of 5% per year before expenses. In order to assist
shareholders in comparing the ongoing expenses of investing in this Fund and
other funds, compare the 5% hypothetical example with the 5% hypothetical
examples that appear in other funds' shareholder reports.
The expenses shown in the table are intended to highlight shareholders ongoing
costs only and do not reflect any transactional expenses, such as sales
charges, redemption fees or exchange fees. Therefore, the second table is
useful in comparing ongoing expenses only, and will not help shareholders
determine the relative total expenses of owning different funds. If these
transactional expenses were included, shareholder expenses would have been
higher.
Expenses Paid
Beginning Ending During the Period*
Account Value Account Value March 1, 2005
March 1, August 31, to August 31,
2005 2005 2005
Actual
Class A $1,000 $1,044.30 $ 7.21
Class B $1,000 $1,039.90 $11.21
Class C $1,000 $1,039.90 $11.31
Class I $1,000 $1,045.90 $ 5.93
Class R $1,000 $1,043.00 $ 9.73
Hypothetical (5% annual return before expenses)**
Class A $1,000 $1,018.15 $ 7.12
Class B $1,000 $1,014.22 $11.07
Class C $1,000 $1,014.12 $11.17
Class I $1,000 $1,019.41 $ 5.85
Class R $1,000 $1,015.68 $ 9.60
* For each class of the Fund, expenses are equal to the annualized expense ratio for the class (1.40% for Class A,
2.18% for Class B, 2.20% for Class C, 1.15% for Class I and 1.89% for Class R), multiplied by the average account
value over the period, multiplied by 184/365 (to reflect the one-half year period shown).
** Hypothetical 5% annual return before expenses is calculated by pro-rating the number of days in the most recent
fiscal half-year divided by 365.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Schedule of Investments (in U.S. dollars)
Shares
Industry Common Stocks Held Value
Africa
South Africa--2.2%
Construction Materials--0.3%
Pretoria Portland Cement Co. Ltd. 33,000 $ 1,326,523
Food & Staples Retailing--0.4%
Massmart Holdings Ltd. 223,700 1,658,052
Food Products--0.3%
Tiger Brands Ltd. 73,600 1,480,246
Industrial Conglomerates--0.3%
Barloworld Ltd. 91,800 1,448,059
Metals & Mining--0.3%
Impala Platinum Holdings Ltd. 13,700 1,418,625
Specialty Retail--0.6%
Edgars Consolidated Stores Ltd. 302,900 1,493,143
JD Group Ltd. 133,100 1,525,285
--------------
3,018,428
Total Common Stocks in
Africa--2.2% 10,349,933
Europe
France--5.0%
Construction & Engineering--0.6%
Vinci SA 32,200 2,855,597
Pharmaceuticals--2.1%
Sanofi-Aventis 114,600 9,783,162
Textiles, Apparel & Luxury
Goods--1.9%
LVMH Moet Hennessy Louis Vuitton SA 115,400 9,332,439
Transportation
Infrastructure--0.4%
Autoroutes du Sud de la France 29,900 1,769,950
Total Common Stocks in France 23,741,148
Germany--0.6%
Textiles, Apparel & Luxury
Goods--0.6%
Puma AG Rudolf Dassler Sport 9,700 2,625,853
Total Common Stocks in Germany 2,625,853
Spain--2.1%
Commercial Banks--0.8%
Banco Popular Espanol SA 306,800 3,748,589
Construction & Engineering--1.3%
ACS Actividades de Construccion y
Servicios, SA 210,612 6,323,637
Total Common Stocks in Spain 10,072,226
Sweden--2.1%
Communications
Equipment--1.1%
Telefonaktiebolaget LM Ericsson 1,461,600 5,077,475
Machinery--1.0%
SKF AB Class B 412,400 5,060,313
Total Common Stocks in Sweden 10,137,788
Shares
Industry Common Stocks Held Value
Europe (concluded)
Switzerland--3.3%
Health Care Equipment
& Supplies--2.4%
Alcon, Inc. 47,000 $ 5,548,350
Synthes, Inc. 49,200 5,912,563
--------------
11,460,913
Textiles, Apparel & Luxury
Goods--0.9%
Swatch Group AG Registered Shares 146,100 4,158,392
Total Common Stocks in Switzerland 15,619,305
United Kingdom--1.6%
Household Products--1.6%
Reckitt Benckiser Plc 252,600 7,821,688
Total Common Stocks in the
United Kingdom 7,821,688
Total Common Stocks in
Europe--14.7% 70,018,008
North America
Canada--2.1%
Diversified Financial Services--0.4%
TSX Group, Inc. 51,400 1,632,721
Energy Equipment & Services--0.4%
Ensign Resource Service Group 67,400 2,121,673
Oil, Gas & Consumable Fuels--1.3%
Cameco Corp. 122,700 6,179,924
Total Common Stocks in Canada 9,934,318
United States--27.1%
Aerospace & Defense--1.8%
Boeing Co. 72,900 4,885,758
Lockheed Martin Corp. 58,200 3,622,368
--------------
8,508,126
Biotechnology--1.2%
Amgen, Inc. (a) 73,400 5,864,660
Capital Markets--0.9%
Franklin Resources, Inc. 51,800 4,166,792
Chemicals--3.1%
Air Products & Chemicals, Inc. 38,300 2,121,820
The Dow Chemical Co. 170,500 7,365,600
E.I. du Pont de Nemours & Co. 28,800 1,139,616
Nalco Holding Co. (a) 79,000 1,445,700
Praxair, Inc. 55,300 2,670,990
--------------
14,743,726
Energy Equipment & Services--4.5%
Baker Hughes, Inc. 44,800 2,632,000
Cooper Cameron Corp. (a) 15,800 1,139,970
Grant Prideco, Inc. (a) 47,400 1,747,164
Halliburton Co. 47,600 2,949,772
National Oilwell Varco, Inc. (a) 38,300 2,459,243
Schlumberger Ltd. 46,700 4,026,941
Transocean, Inc. (a) 110,300 6,512,112
--------------
21,467,202
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Schedule of Investments (continued) (in U.S. dollars)
Shares
Industry Common Stocks Held Value
North America (concluded)
United States (concluded)
Food Products--1.0%
McCormick & Co., Inc. 37,900 $ 1,285,189
Wm. Wrigley Jr. Co. 47,400 3,367,770
--------------
4,652,959
Health Care Equipment
& Supplies--1.7%
Medtronic, Inc. 78,800 4,491,600
Varian Medical Systems, Inc. (a) 90,800 3,615,656
--------------
8,107,256
Health Care Providers
& Services--0.2%
Covance, Inc. (a) 15,200 794,960
Hotels, Restaurants
& Leisure--2.2%
Starbucks Corp. (a) 30,500 1,495,720
Station Casinos, Inc. 47,100 3,147,222
Wynn Resorts Ltd. (a) 58,800 2,805,936
Yum! Brands, Inc. 70,300 3,330,814
--------------
10,779,692
Industrial Conglomerates--2.0%
3M Co. 135,600 9,647,940
Internet Software
& Services--1.2%
Google, Inc. (a) 9,300 2,659,800
Yahoo!, Inc. (a) 92,900 3,097,286
--------------
5,757,086
Machinery--1.9%
Caterpillar, Inc. 72,100 4,000,829
ITT Industries, Inc. 24,700 2,695,264
Pall Corp. 81,100 2,319,460
--------------
9,015,553
Media--0.7%
News Corp. Class B 94,735 1,619,021
Walt Disney Co. 63,200 1,592,008
--------------
3,211,029
Oil, Gas & Consumable
Fuels--4.2%
Exxon Mobil Corp. 240,100 14,381,990
Sunoco, Inc. 74,700 5,430,690
--------------
19,812,680
Pharmaceuticals--0.3%
MGI Pharma, Inc. (a) 58,300 1,571,768
Trading Companies
& Distributors--0.2%
MSC Industrial Direct Co. Class A 24,900 871,500
Total Common Stocks in the
United States 128,972,929
Total Common Stocks in
North America--29.2% 138,907,247
Shares
Industry Common Stocks Held Value
Pacific Basin
Australia--20.1%
Beverages--2.6%
Coca-Cola Amatil Ltd. 1,276,700 $ 8,296,200
Foster's Group Ltd. 970,000 4,208,338
--------------
12,504,538
Biotechnology--1.8%
CSL Ltd. 330,100 8,549,024
Capital Markets--3.3%
Macquarie Bank Ltd. (e) 246,100 11,740,937
Perpetual Trustees Australia Ltd. 80,700 3,726,361
--------------
15,467,298
Commercial Banks--4.3%
Commonwealth Bank of Australia 318,800 8,995,416
National Australia Bank Ltd. 484,600 11,430,591
--------------
20,426,007
Construction Materials--0.3%
James Hardie Industries NV 245,300 1,595,001
Diversified Financial
Services--0.4%
Australian Stock Exchange Ltd. 96,800 1,942,233
Health Care Equipment
& Supplies--0.7%
Cochlear Ltd. 111,400 3,534,039
Industrial Conglomerates--1.0%
Wesfarmers Ltd. 156,400 4,659,076
Insurance--1.9%
QBE Insurance Group Ltd. 686,000 8,874,838
Media--1.8%
Publishing & Broadcasting Ltd. 692,100 8,416,589
Road & Rail--1.4%
Toll Holdings Ltd. 643,667 6,841,904
Transportation
Infrastructure--0.6%
Transurban Group 501,800 2,708,041
Total Common Stocks in Australia 95,518,588
China--1.2%
Electrical Equipment--0.1%
BYD Company Limited 'H' 255,800 456,779
Oil, Gas & Consumable
Fuels--1.1%
China Shenhua Energy Co. Ltd.
Class H (a) 2,509,000 2,792,387
Sinopec Zhenhai Refining and
Chemical Co. Ltd. 2,288,100 2,508,007
--------------
5,300,394
Total Common Stocks in China 5,757,173
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Schedule of Investments (continued) (in U.S. dollars)
Shares
Industry Common Stocks Held Value
Pacific Basin/Asia (continued)
Hong Kong--6.1%
Distributors--0.5%
China Resources Enterprise 1,655,000 $ 2,643,386
Electric Utilities--1.7%
Cheung Kong Infrastructure
Holdings Ltd. 2,546,200 8,043,430
Marine--1.2%
NWS Holdings Ltd. 1,749,700 2,844,132
Orient Overseas International Ltd. 772,500 3,096,717
--------------
5,940,849
Real Estate--0.6%
Midland Holdings Ltd. 2,132,300 1,246,573
Shun Tak Holdings Ltd. 1,631,800 1,468,255
--------------
2,714,828
Transportation Infrastructure--2.1%
COSCO Pacific Ltd. 2,399,000 4,764,601
China Merchants Holdings
International Co., Ltd. 2,403,000 5,114,425
--------------
9,879,026
Total Common Stocks in Hong Kong 29,221,519
India--8.6%
Auto Components--0.2%
Bharat Forge Ltd. 133,400 984,842
Automobiles--0.5%
Tata Motors Ltd. 218,700 2,303,365
Chemicals--0.5%
Reliance Industries Ltd. 162,200 2,647,108
Commercial Banks--1.7%
HDFC Bank Ltd. 385,000 5,615,023
ICICI Bank Ltd. 68,318 748,705
ICICI Bank Ltd. (d) 70,900 1,657,642
--------------
8,021,370
Construction & Engineering--0.7%
Larsen & Toubro Ltd. 103,300 3,123,015
Construction Materials--0.1%
Ultra Tech Cement Ltd. 27,723 276,067
Electrical Equipment--0.4%
Bharat Heavy Electricals Ltd. 84,700 2,057,422
Household Products--0.7%
Hindustan Lever Ltd. 845,800 3,180,512
IT Services--2.3%
Infosys Technologies Ltd. 159,000 8,593,782
Tata Consultancy Services Ltd. 77,500 2,478,356
--------------
11,072,138
Metals & Mining--0.6%
Hindalco Industries Ltd. 896,000 2,915,201
Pharmaceuticals--0.4%
Sun Pharmaceuticals Industries Ltd. 137,200 1,947,997
Wireless Telecommunication
Services--0.5%
Bharti Tele-Ventures Ltd. (a) 343,700 2,461,702
Total Common Stocks in India 40,990,739
Shares
Industry Common Stocks Held Value
Pacific Basin/Asia (concluded)
Japan--8.0%
Automobiles--1.0%
Isuzu Motors Ltd. 768,000 $ 2,366,484
Toyota Motor Corp. 57,100 2,329,586
--------------
4,696,070
Chemicals--0.5%
JSR Corp. 107,000 2,412,073
Commercial Banks--3.0%
Mitsui Trust Holdings, Inc. 419,000 4,707,777
Mizuho Financial Group, Inc. 900 5,015,903
Sumitomo Mitsui Financial Group, Inc. 600 4,902,910
--------------
14,626,590
Electrical Equipment--1.0%
Matsushita Electric Works Ltd. 499,000 4,679,513
Household Durables--0.5%
Sekisui House Ltd. 217,000 2,389,509
Oil, Gas & Consumable
Fuels--1.0%
INPEX Corp. 300 2,345,354
Nippon Oil Corp. 301,000 2,422,489
--------------
4,767,843
Real Estate--0.5%
Leopalace21 Corp. 128,400 2,398,077
Specialty Retail--0.5%
Yamada Denki Co., Ltd. 37,000 2,371,919
Total Common Stocks in Japan 38,341,594
Singapore--0.3%
Beverages--0.2%
Asia Pacific Breweries Ltd. 159,500 837,812
Food Products--0.1%
People's Food Holdings Ltd. 888,000 490,789
Total Common Stocks in Singapore 1,328,601
South Korea--4.4%
Auto Components--0.3%
Hankook Tire Co. Ltd. 127,200 1,520,077
Automobiles--2.6%
Hyundai Motor Co. 180,800 12,441,732
Chemicals--0.6%
LG Chem Ltd. 63,800 2,608,045
Diversified Telecommunication
Services--0.9%
KT Corp. 115,400 4,368,452
Total Common Stocks in
South Korea 20,938,306
Total Common Stocks in the
Pacific Basin--48.7% 232,096,520
Total Common Stocks
(Cost--$392,507,362)--94.8% 451,371,708
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Schedule of Investments (concluded) (in U.S. dollars)
Shares
Industry Preferred Stocks Held Value
Europe
Germany--2.3%
Automobiles--2.3%
Porsche AG 13,995 $ 10,917,352
Total Preferred Stocks in
Europe--2.3% 10,917,352
Total Preferred Stocks
(Cost--$7,232,296)--2.3% 10,917,352
Beneficial
Short-Term Securities Interest Value
Merrill Lynch Liquidity Series, LLC
Cash Sweep Series I (b) $ 3,540,460 $ 3,540,460
Merrill Lynch Liquidity Series, LLC
Money Market Series (b)(c) 6,944,000 6,944,000
Total Short-Term Securities
(Cost--$10,484,460)--2.2% 10,484,460
Total Investments (Cost--$410,224,118*)--99.3% 472,773,520
Other Assets Less Liabilities--0.7% 3,207,014
--------------
Net Assets--100.0% $ 475,980,534
==============
(a) Non-income producing security.
(b) Investments in companies considered to be an affiliate of the Fund, for purposes of
Section 2(a)(3) of the Investment Company Act of 1940, were as follows:
Net Interest
Affiliate Activity Income
Merrill Lynch Liquidity Series, LLC
Cash Sweep Series I $ 2,526,824 $136,408
Merrill Lynch Liquidity Series, LLC
Money Market Series $ (51,187,800) $ 63,793
(c) Security was purchased with the cash proceeds from securities loans.
(d) Depositary Receipts.
(e) Security, or a portion of security, is on loan.
* The cost and unrealized appreciation (depreciation) of investments as of August 31,
2005, as computed for federal income tax purposes, were as follows:
Aggregate cost $ 410,264,829
===================
Gross unrealized appreciation $ 66,854,514
Gross unrealized depreciation (4,345,823)
-------------------
Net unrealized appreciation $ 62,508,691
===================
For Fund compliance purposes, the Fund's industry classifications refer to any one
or more of the industry sub-classifications used by one or more widely recognized
market indexes or ratings group indexes, and/or as defined by Fund management.
This definition may not apply for purposes of this report, which may combine industry
sub-classifications for reporting ease. Industries are shown as a percentage of net
assets. These industry classifications are unaudited.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Statement of Assets and Liabilities
As of August 31, 2005
Assets
Investments in unaffiliated securities, at value (including securities loaned
of $6,679,119) (identified cost--$399,739,658) $ 462,289,060
Investments in affiliated securities, at value (identified cost--$10,484,460) 10,484,460
Foreign cash (cost--$3,706,167) 3,665,368
Cash 5,751
Receivables:
Securities sold $ 47,468,845
Dividends 1,811,675
Capital shares sold 92,465
Interest from affiliates 9,379
Securities lending 1,809 49,384,173
---------------
Prepaid expenses 135,459
---------------
Total assets 525,964,271
---------------
Liabilities
Collateral on securities loaned, at value 6,944,000
Deferred foreign capital gain tax 443,739
Payables:
Securities purchased 40,263,732
Capital shares redeemed 1,293,774
Other affiliates 269,676
Distributor 267,698
Investment adviser 256,972 42,351,852
---------------
Accrued expenses and other liabilities 244,146
---------------
Total liabilities 49,983,737
---------------
Net Assets
Net assets $ 475,980,534
===============
Net Assets Consist of
Class A Shares of Common Stock, $.10 par value, 100,000,000 shares authorized $ 881,352
Class B Shares of Common Stock, $.10 par value, 300,000,000 shares authorized 2,087,822
Class C Shares of Common Stock, $.10 par value, 100,000,000 shares authorized 545,913
Class I Shares of Common Stock, $.10 par value, 100,000,000 shares authorized 1,063,631
Class R Shares of Common Stock, $.10 par value, 300,000,000 shares authorized 6,771
Paid-in capital in excess of par 936,043,144
Undistributed investment income--net $ 4,225,314
Accumulated realized capital losses--net (530,894,552)
Unrealized appreciation--net 62,021,139
---------------
Total accumulated losses--net (464,648,099)
---------------
Net Assets $ 475,980,534
===============
Net Asset Value
Class A--Based on net assets of $93,408,219 and 8,813,519 shares outstanding $ 10.60
===============
Class B--Based on net assets of $212,352,872 and 20,878,217 shares outstanding $ 10.17
===============
Class C--Based on net assets of $55,506,759 and 5,459,132 shares outstanding $ 10.17
===============
Class I--Based on net assets of $114,007,188 and 10,636,311 shares outstanding $ 10.72
===============
Class R--Based on net assets of $705,496 and 67,713 shares outstanding $ 10.42
===============
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Statement of Operations
For the Year Ended August 31, 2005
Investment Income
Dividends (net of $492,653 foreign withholding tax) $ 13,774,875
Interest from affiliates 136,408
Securities lending--net 63,793
---------------
Total income 13,975,076
---------------
Expenses
Investment advisory fees $ 3,848,217
Account maintenance and distribution fees--Class B 2,390,196
Transfer agent fees--Class B 637,757
Account maintenance and distribution fees--Class C 597,629
Transfer agent fees--Class A 270,077
Account maintenance fees--Class A 249,022
Transfer agent fees--Class I 233,313
Accounting services 229,495
Transfer agent fees--Class C 168,708
Custodian fees 163,407
Printing and shareholder reports 93,113
Professional fees 68,752
Directors' fees and expenses 68,022
Registration fees 61,375
Pricing fees 9,179
Account maintenance and distribution fees--Class R 1,157
Transfer agent fees--Class R 776
Other 44,138
---------------
Total expenses 9,134,333
---------------
Investment income--net 4,840,743
---------------
Realized & Unrealized Gain (Loss)--Net
Realized gain (loss) on:
Investments (including $78,765 foreign capital gain tax)--net 91,081,748
Foreign currency transactions--net (550,259) 90,531,489
---------------
Change in unrealized appreciation/depreciation on:
Investments (including $443,739 deferred foreign capital gain tax)--net 20,223,584
Foreign currency transactions--net (115,527) 20,108,057
--------------- ---------------
Total realized and unrealized gain--net 110,639,546
---------------
Net Increase in Net Assets Resulting from Operations $ 115,480,289
===============
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Statements of Changes in Net Assets
For the Year Ended
August 31,
Increase (Decrease) in Net Assets: 2005 2004
Operations
Investment income--net $ 4,840,743 $ 2,494,664
Realized gain--net 90,531,489 113,251,216
Change in unrealized appreciation/depreciation--net 20,108,057 (36,489,741)
--------------- ---------------
Net increase in net assets resulting from operations 115,480,289 79,256,139
--------------- ---------------
Dividends to Shareholders
Investment income--net:
Class A (18,378) --
Class B -- --
Class C -- --
Class I (328,352) --
Class R (303) --
--------------- ---------------
Net decrease in net assets resulting from dividends to shareholders (347,033) --
--------------- ---------------
Capital Share Transactions
Net decrease in net assets derived from capital share transactions (158,083,866) (203,244,671)
--------------- ---------------
Redemption Fees
Redemption fees 32 (293)
--------------- ---------------
Net Assets
Total decrease in net assets (42,950,578) (123,988,825)
Beginning of year 518,931,112 642,919,937
--------------- ---------------
End of year* $ 475,980,534 $ 518,931,112
=============== ===============
* Undistributed investment income--net $ 4,225,314 $ 349,326
=============== ===============
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Financial Highlights
Class A
The following per share data and ratios have been derived For the Year Ended August 31,
from information provided in the financial statements. 2005 2004 2003 2002 2001
Per Share Operating Performance
Net asset value, beginning of year $ 8.47 $ 7.51 $ 6.95 $ 9.44 $ 17.95
---------- ---------- ---------- ---------- ----------
Investment income (loss)--net* .13 .07 .03 (.02) --++
Realized and unrealized gain (loss)--net 2.00++++ .89++++ .53 (2.47) (6.64)
---------- ---------- ---------- ---------- ----------
Total from investment operations 2.13 .96 .56 (2.49) (6.64)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions from:
Investment income--net --++ -- -- -- --
Realized gain--net -- -- -- -- (.58)
In excess of realized gain--net -- -- -- -- (1.29)
---------- ---------- ---------- ---------- ----------
Total distributions -- -- -- -- (1.87)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 10.60 $ 8.47 $ 7.51 $ 6.95 $ 9.44
========== ========== ========== ========== ==========
Total Investment Return**
Based on net asset value per share 25.17% 12.78% 8.06% (26.38%) (39.58%)
========== ========== ========== ========== ==========
Ratios to Average Net Assets
Expenses 1.38% 1.37% 1.42% 1.31% 1.18%
========== ========== ========== ========== ==========
Investment income (loss)--net 1.35% .87% .40% (.18%) (.001%)
========== ========== ========== ========== ==========
Supplemental Data
Net assets, end of year (in thousands) $ 93,408 $ 98,519 $ 110,092 $ 130,310 $ 240,027
========== ========== ========== ========== ==========
Portfolio turnover 108.95% 71.91% 121.00% 105.73% 126.37%
========== ========== ========== ========== ==========
* Based on average shares outstanding.
** Total investment return excludes the effects of sales charges.
++ Amount is less than $(.01) per share.
++++ Includes redemption fees, which are less than $.01 per share.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Financial Highlights (continued)
Class B
The following per share data and ratios have been derived For the Year Ended August 31,
from information provided in the financial statements. 2005 2004 2003 2002 2001
Per Share Operating Performance
Net asset value, beginning of year $ 8.19 $ 7.32 $ 6.83 $ 9.35 $ 17.75
---------- ---------- ---------- ---------- ----------
Investment income (loss)--net* .05 --++ (.03) (.08) (.10)
Realized and unrealized gain (loss)--net 1.93++++ .87++++ .52 (2.44) (6.56)
---------- ---------- ---------- ---------- ----------
Total from investment operations 1.98 .87 .49 (2.52) (6.66)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions from:
Realized gain--net -- -- -- -- (.54)
In excess of realized gain--net -- -- -- -- (1.20)
---------- ---------- ---------- ---------- ----------
Total distributions -- -- -- -- (1.74)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 10.17 $ 8.19 $ 7.32 $ 6.83 $ 9.35
========== ========== ========== ========== ==========
Total Investment Return**
Based on net asset value per share 24.18% 11.89% 7.17% (26.95%) (40.01%)
========== ========== ========== ========== ==========
Ratios to Average Net Assets
Expenses 2.16% 2.16% 2.22% 2.09% 1.95%
========== ========== ========== ========== ==========
Investment income (loss)--net .56% .05% (.43%) (.99%) (.77%)
========== ========== ========== ========== ==========
Supplemental Data
Net assets, end of year (in thousands) $ 212,353 $ 252,691 $ 327,483 $ 456,393 $1,046,889
========== ========== ========== ========== ==========
Portfolio turnover 108.95% 71.91% 121.00% 105.73% 126.37%
========== ========== ========== ========== ==========
* Based on average shares outstanding.
** Total investment return excludes the effects of sales charges.
++ Amount is less than $.01 per share.
++++ Includes redemption fees, which are less than $.01 per share.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Financial Highlights (continued)
Class C
The following per share data and ratios have been derived For the Year Ended August 31,
from information provided in the financial statements. 2005 2004 2003 2002 2001
Per Share Operating Performance
Net asset value, beginning of year $ 8.19 $ 7.32 $ 6.83 $ 9.36 $ 17.76
---------- ---------- ---------- ---------- ----------
Investment income (loss)--net* .05 --++ (.03) (.08) (.10)
Realized and unrealized gain (loss)--net 1.93++++ .87++++ .52 (2.45) (6.56)
---------- ---------- ---------- ---------- ----------
Total from investment operations 1.98 .87 .49 (2.53) (6.66)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions from:
Realized gain--net -- -- -- -- (.54)
In excess of realized gain--net -- -- -- -- (1.20)
---------- ---------- ---------- ---------- ----------
Total distributions -- -- -- -- (1.74)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 10.17 $ 8.19 $ 7.32 $ 6.83 $ 9.36
========== ========== ========== ========== ==========
Total Investment Return**
Based on net asset value per share 24.18% 11.89% 7.17% (27.03%) (39.97%)
========== ========== ========== ========== ==========
Ratios to Average Net Assets
Expenses 2.18% 2.18% 2.24% 2.11% 1.96%
========== ========== ========== ========== ==========
Investment income (loss)--net .55% .05% (.43%) (.99%) (.78%)
========== ========== ========== ========== ==========
Supplemental Data
Net assets, end of year (in thousands) $ 55,507 $ 60,771 $ 72,249 $ 95,117 $ 197,356
========== ========== ========== ========== ==========
Portfolio turnover 108.95% 71.91% 121.00% 105.73% 126.37%
========== ========== ========== ========== ==========
* Based on average shares outstanding.
** Total investment return excludes the effects of sales charges.
++ Amount is less than $.01 per share.
++++ Includes redemption fees, which are less than $.01 per share.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Financial Highlights (continued)
Class I
The following per share data and ratios have been derived For the Year Ended August 31,
from information provided in the financial statements. 2005 2004 2003 2002 2001
Per Share Operating Performance
Net asset value, beginning of year $ 8.56 $ 7.58 $ 7.00 $ 9.48 $ 18.01
---------- ---------- ---------- ---------- ----------
Investment income--net* .16 .09 .04 --++ .03
Realized and unrealized gain (loss)--net 2.03++++ .89++++ .54 (2.48) (6.65)
---------- ---------- ---------- ---------- ----------
Total from investment operations 2.19 .98 .58 (2.48) (6.62)
---------- ---------- ---------- ---------- ----------
Less dividends and distributions from:
Investment income--net (.03) -- -- -- --
Realized gain--net -- -- -- -- (.59)
In excess of realized gain--net -- -- -- -- (1.32)
---------- ---------- ---------- ---------- ----------
Total distributions (.03) -- -- -- (1.91)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 10.72 $ 8.56 $ 7.58 $ 7.00 $ 9.48
========== ========== ========== ========== ==========
Total Investment Return**
Based on net asset value per share 25.58% 12.93% 8.29% (26.16%) (39.39%)
========== ========== ========== ========== ==========
Ratios to Average Net Assets
Expenses 1.13% 1.13% 1.16% 1.06% .93%
========== ========== ========== ========== ==========
Investment income--net 1.60% 1.05% .63% .04% .25%
========== ========== ========== ========== ==========
Supplemental Data
Net assets, end of year (in thousands) $ 114,007 $ 106,785 $ 133,096 $ 55,525 $ 155,922
========== ========== ========== ========== ==========
Portfolio turnover 108.95% 71.91% 121.00% 105.73% 126.37%
========== ========== ========== ========== ==========
* Based on average shares outstanding.
** Total investment return excludes the effects of sales charges.
++ Amount is less than $.01 per share.
++++ Includes redemption fees, which are less than $.01 per share.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Financial Highlights (concluded)
Class R
For the Period
January 3,
For the Year Ended 2003++ to
The following per share data and ratios have been derived August 31, August 31,
from information provided in the financial statements. 2005 2004 2003
Per Share Operating Performance
Net asset value, beginning of period $ 8.36 $ 7.39 $ 6.50
------------ ------------ ------------
Investment income--net** .06 .08 .06
Realized and unrealized gain--net 2.01++++ .89++++ .83
------------ ------------ ------------
Total from investment operations 2.07 .97 .89
------------ ------------ ------------
Less distributions from investment income--net (.01) -- --
------------ ------------ ------------
Net asset value, end of period $ 10.42 $ 8.36 $ 7.39
============ ============ ============
Total Investment Return***
Based on net asset value per share 24.81% 13.13% 13.69%+++
============ ============ ============
Ratios to Average Net Assets
Expenses 1.79% 1.56% 1.64%*
============ ============ ============
Investment income--net .99% 1.36% .66%*
============ ============ ============
Supplemental Data
Net assets, end of period (in thousands) $ 705 $ 166 --+++++
============ ============ ============
Portfolio turnover 108.95% 71.91% 121.00%
============ ============ ============
* Annualized.
** Based on average shares outstanding.
*** Total investment return excludes the effects of sales charges.
++ Commencement of operations.
++++ Includes redemption fees, which are less than $.01 per share.
+++ Aggregate total investment return.
+++++ Amount is less than $1,000.
See Notes to Financial Statements.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Notes to Financial Statements
1. Significant Accounting Policies:
Merrill Lynch Global Growth Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. The Fund's financial statements are prepared in
conformity with U.S. generally accepted accounting principles, which may
require the use of management accruals and estimates. Actual results may
differ from these estimates. The Fund offers multiple classes of shares.
Shares of Class A and Class I are sold with a front-end sales charge. Shares
of Class B and Class C may be subject to a contingent deferred sales charge.
Class R Shares are sold only to certain retirement plans. All classes of
shares have identical voting, dividend, liquidation and other rights and the
same terms and conditions, except that Class A, Class B, Class C and Class R
Shares bear certain expenses related to the account maintenance of such
shares, and Class B, Class C and Class R Shares also bear certain expenses
related to the distribution of such shares. Each class has exclusive voting
rights with respect to matters relating to its account maintenance and
distribution expenditures (except that Class B shareholders have voting rights
with respect to material changes to the Class A distribution plan). Income,
expenses (other than expenses attributable to a specific class) and realized
and unrealized gains and losses are allocated daily to each class based on its
relative net assets. The following is a summary of significant accounting
policies followed by the Fund.
(a) Valuation of investments--Equity securities that are held by the Fund that
are traded on stock exchanges or the Nasdaq National Market are valued at the
last sale price or official close price on the exchange, as of the close of
business on the day the securities are being valued or, lacking any sales, at
the last available bid price for long positions, and at the last available
asked price for short positions. In cases where equity securities are traded
on more than one exchange, the securities are valued on the exchange
designated as the primary market by or under the authority of the Board of
Directors of the Fund. Long positions traded in the over-the-counter ("OTC")
market, Nasdaq Small Cap or Bulletin Board are valued at the last available
bid price or yield equivalent obtained from one or more dealers or pricing
services approved by the Board of Directors of the Fund. Short positions
traded in the OTC market are valued at the last available asked price.
Portfolio securities that are traded both in the OTC market and on a stock
exchange are valued according to the broadest and most representative market.
Options written are valued at the last sale price in the case of exchange-
traded options or, in the case of options traded in the OTC market, the last
asked price. Options purchased are valued at their last sale price in the case
of exchange-traded options or, in the case of options traded in the OTC
market, the last bid price. Swap agreements are valued based upon quoted fair
valuations received daily by the Fund from a pricing service or counterparty.
Financial futures contracts and options thereon, which are traded on
exchanges, are valued at their last sale price as of the close of such
exchanges. Obligations with remaining maturities of 60 days or less are valued
at amortized cost unless the Investment Adviser believes that this method no
longer produces fair valuations.
Repurchase agreements are valued at cost plus accrued interest. The Fund
employs pricing services to provide certain securities prices for the Fund.
Securities and assets for which market quotations are not readily available
are valued at fair value as determined in good faith by or under the direction
of the Board of Directors of the Fund, including valuations furnished by the
pricing services retained by the Fund, which may use a matrix system for
valuations. The procedures of a pricing service and its valuations are
reviewed by the officers of the Fund under the general supervision of the
Fund's Board of Directors. Such valuations and procedures will be reviewed
periodically by the Board of Directors of the Fund.
Generally, trading in foreign securities, as well as U.S. government
securities and money market instruments, is substantially completed each day
at various times prior to the close of business on the New York Stock Exchange
("NYSE"). The values of such securities used in computing the net asset value
of the Fund's shares are determined as of such times. Foreign currency
exchange rates also are generally determined prior to the close of business on
the NYSE. Occasionally, events affecting the values of such securities and
such exchange rates may occur between the times at which they are determined
and the close of business on the NYSE that may not be reflected in the
computation of the Fund's net asset value. If events (for example, a company
announcement, market volatility or a natural disaster) occur during such
periods that are expected to materially affect the value of such securities,
those securities may be valued at their fair value as determined in good faith
by the Fund's Board of Directors or by the Investment Adviser using a pricing
service and/or procedures approved by the Fund's Board of Directors.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Notes to Financial Statements (continued)
(b) Foreign currency transactions--Transactions denominated in foreign
currencies are recorded at the exchange rate prevailing when recognized.
Assets and liabilities denominated in foreign currencies are valued at the
exchange rate at the end of the period. Foreign currency transactions are the
result of settling (realized) or valuing (unrealized) assets or liabilities
expressed in foreign currencies into U.S. dollars. Realized and unrealized
gains or losses from investments include the effects of foreign exchange rates
on investments.
(c) Derivative financial instruments--The Fund may engage in various portfolio
investment strategies both to increase the return of the Fund and to hedge, or
protect, its exposure to interest rate movements and movements in the
securities markets. Losses may arise due to changes in the value of the
contract or if the counterparty does not perform under the contract.
* Options--The Fund may write and purchase call and put options. When the Fund
writes an option, an amount equal to the premium received by the Fund is
reflected as an asset and an equivalent liability. The amount of the liability
is subsequently marked-to-market to reflect the current market value of the
option written. When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or deducted from)
the basis of the security acquired or deducted from (or added to) the proceeds
of the security sold. When an option expires (or the Fund enters into a
closing transaction), the Fund realizes a gain or loss on the option to the
extent of the premiums received or paid (or gain or loss to the extent the
cost of the closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
* Forward foreign exchange contracts--The Fund may enter into forward foreign
exchange contracts as a hedge against either specific transactions or
portfolio positions. The contract is marked-to-market daily and the change in
market value is recorded by the Fund as an unrealized gain or loss. When the
contract is closed, the Fund records a realized gain or loss equal to the
difference between the value at the time it was opened and the value at the
time it was closed.
* Foreign currency options and futures--The Fund may also purchase or sell
listed or over-the-counter foreign currency options, foreign currency futures
and related options on foreign currency futures as a short or long hedge
against possible variations in foreign exchange rates. Such transactions may
be effected with respect to hedges on non-U.S. dollar-denominated securities
owned by the Fund, sold by the Fund but not yet delivered, or committed or
anticipated to be purchased by the Fund.
* Financial futures contracts--The Fund may purchase or sell financial futures
contracts and options on such futures contracts. Futures contracts are
contracts for delayed delivery of securities at a specific future date and at
a specific price or yield. Upon entering into a contract, the Fund deposits
and maintains as collateral such initial margin as required by the exchange on
which the transaction is effected. Pursuant to the contract, the Fund agrees
to receive from or pay to the broker an amount of cash equal to the daily
fluctuation in value of the contract. Such receipts or payments are known as
variation margin and are recorded by the Fund as unrealized gains or losses.
When the contract is closed, the Fund records a realized gain or loss equal to
the difference between the value of the contract at the time it was opened and
the value at the time it was closed.
(d) Income taxes--It is the Fund's policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required. Under the applicable
foreign tax law, a withholding tax may be imposed on interest, dividends and
capital gains at various rates. Interest income is recognized on an accrual
basis.
(e) Security transactions and investment income--Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Realized gains and losses on security transactions are determined on the
identified cost basis. Dividend income is recorded on the ex-dividend dates.
Dividends from foreign securities where the ex-dividend date may have passed
are subsequently recorded when the Fund has determined the ex-dividend date.
Interest income is recognized on the accrual basis.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Notes to Financial Statements (continued)
(f) Prepaid registration fees--Prepaid registration fees are charged to
expense as the related shares are issued.
(g) Dividends and distributions--Dividends and distributions paid by the Fund
are recorded on the ex-dividend dates.
(h) Securities lending--The Fund may lend securities to financial institutions
that provide cash or securities issued or guaranteed by the U.S. government as
collateral, which will be maintained at all times in an amount equal to at
least 100% of the current market value of the loaned securities. The market
value of the loaned securities is determined at the close of business of the
Fund and any additional required collateral is delivered to the Fund on the
next business day. Where the Fund receives securities as collateral for the
loaned securities, it collects a fee from the borrower. The Fund typically
receives the income on the loaned securities but does not receive the income
on the collateral. Where the Fund receives cash collateral, it may invest such
collateral and retain the amount earned on such investment, net of any amount
rebated to the borrower. Loans of securities are terminable at any time and
the borrower, after notice, is required to return borrowed securities within
five business days. The Fund may pay reasonable finder's, lending agent,
administrative and custodial fees in connection with its loans. In the event
that the borrower defaults on its obligation to return borrowed securities
because of insolvency or for any other reason, the Fund could experience
delays and costs in gaining access to the collateral. The Fund also could
suffer a loss where the value of the collateral falls below the market value
of the borrowed securities, in the event of borrower default or in the event
of losses on investments made with cash collateral.
(i) Reclassifications--U.S. generally accepted accounting principles require
that certain components of net assets be adjusted to reflect permanent
differences between financial and tax reporting. Accordingly, during the
current year, $629,024 has been reclassified between undistributed net
investment income and accumulated net realized capital losses and $11,302 has
been reclassified between paid-in capital in excess of par and undistributed
net investment income as a result of permanent differences attributable to
foreign currency transactions, characterization of expenses, and non-
deductible expenses. These reclassifications have no effect on net assets or
net asset values per share.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Merrill Lynch
Investment Managers, L.P. ("MLIM"). The general partner of MLIM is Princeton
Services, Inc. ("PSI"), an indirect, wholly-owned subsidiary of Merrill Lynch
& Co., Inc. ("ML & Co."), which is the limited partner. The Fund has also
entered into a Distribution Agreement and Distribution Plans with FAM
Distributors, Inc. ("FAMD" or the "Distributor"), which is a wholly-owned
subsidiary of Merrill Lynch Group, Inc.
MLIM is responsible for the management of the Fund's portfolio and provides
the necessary personnel, facilities, equipment and certain other services
necessary to the operations of the Fund. For such services, the Fund pays a
monthly fee based upon the average daily value of the Fund's net assets at an
annual rate of .75% of the average daily net assets not exceeding $1.5 billion
and .725% of the average daily net assets in excess of $1.5 billion. MLIM has
entered into a Sub-Advisory Agreement with Merrill Lynch Asset Management U.K.
Limited ("MLAM U.K."), an affiliate of MLIM, pursuant to which MLAM U.K.
provides investment advisory services to MLIM with respect to the Fund. There
is no increase in the aggregate fees paid by the Fund for these services.
Pursuant to the Distribution Plans adopted by the Fund in accordance with Rule
12b-1 under the Investment Company Act of 1940, the Fund pays the Distributor
ongoing account maintenance and distribution fees. The fees are accrued daily
and paid monthly at annual rates based upon the average daily net assets of
the shares as follows:
Account
Maintenance Distribution
Fee Fee
Class A .25% --
Class B .25% .75%
Class C .25% .75%
Class R .25% .25%
Pursuant to a sub-agreement with the Distributor, Merrill Lynch, Pierce,
Fenner & Smith Incorporated ("MLPF&S"), an affiliate of ML & Co., also
provides account maintenance and distribution services to the Fund. The
ongoing account maintenance fee compensates the Distributor and MLPF&S for
providing account maintenance services to Class A, Class B, Class C and Class
R shareholders. The ongoing distribution fee compensates the Distributor and
MLPF&S for providing shareholder and distribution-related services to Class B,
Class C and Class R shareholders.
For the year ended August 31, 2005, FAMD earned underwriting discounts and
direct commissions and MLPF&S earned dealer concessions on sales of the Fund's
Class A and Class I Shares as follows:
FAMD MLPF&S
Class A $ 523 $ 7,079
Class I $ 38 $ 616
For the year ended August 31, 2005, MLPF&S received contingent deferred sales
charges of $52,246 and $1,786 relating to transactions in Class B and Class C
Shares, respectively.
The Fund has received an exemptive order from the Securities and Exchange
Commission permitting it to lend portfolio securities to MLPF&S or its
affiliates. Pursuant to that order, the Fund also has retained Merrill Lynch
Investment Managers, LLC ("MLIM, LLC"), an affiliate of MLIM, as the
securities lending agent for a fee based on a share of the returns on
investment of cash collateral. MLIM, LLC may, on behalf of the Fund, invest
cash collateral received by the Fund for such loans, among other things, in a
private investment company managed by MLIM, LLC or in registered money market
funds advised by MLIM or its affiliates. For the year ended August 31, 2005,
MLIM, LLC received $26,763 in securities lending agent fees.
In addition, MLPF&S received $187,204 in commissions on the execution of
portfolio security transactions for the Fund for the year ended August 31,
2005.
For the year ended August 31, 2005, the Fund reimbursed MLIM $12,479 for
certain accounting services.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of ML & Co.,
is the Fund's transfer agent.
Certain officers and/or directors of the Fund are officers and/or directors of
MLIM, PSI, MLAM U.K., FDS, FAMD, ML & Co., and/or MLIM, LLC.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the
year ended August 31, 2005 were $551,805,843 and $719,172,396, respectively.
4. Capital Share Transactions:
Net decrease in net assets derived from capital share transactions was
$158,083,866 and $203,244,964 for the years ended August 31, 2005 and August
31, 2004, respectively.
Transactions in capital shares for each class were as follows:
Class A Shares for the Year Dollar
Ended August 31, 2005 Shares Amount
Shares sold 447,117 $ 4,437,307
Automatic conversion of shares 1,143,256 11,239,018
Shares issued to shareholders in
reinvestment of dividends 1,629 15,927
--------------- -----------------
Total issued 1,592,002 15,692,252
Shares redeemed (4,414,664) (43,470,746)
--------------- -----------------
Net decrease (2,822,662) $ (27,778,494)
=============== =================
Class A Shares for the Year Dollar
Ended August 31, 2004 Shares Amount
Shares sold 707,209 $ 5,969,716
Automatic conversion of shares 1,437,615 12,282,386
--------------- -----------------
Total issued 2,144,824 18,252,102
Shares redeemed (5,172,582) (43,630,780)
--------------- -----------------
Net decrease (3,027,758) $ (25,378,678)
=============== =================
Class B Shares for the Year Dollar
Ended August 31, 2005 Shares Amount
Shares sold 587,073 $ 5,539,334
--------------- -----------------
Shares redeemed (9,385,041) (88,290,410)
Automatic conversion of shares (1,186,494) (11,239,018)
--------------- -----------------
Total redeemed (10,571,535) (99,529,428)
--------------- -----------------
Net decrease (9,984,462) $ (93,990,094)
=============== =================
Class B Shares for the Year Dollar
Ended August 31, 2004 Shares Amount
Shares sold 1,044,170 $ 8,602,162
--------------- -----------------
Automatic conversion of shares (1,480,598) (12,282,386)
Shares redeemed (13,450,908) (110,144,927)
--------------- -----------------
Total redeemed (14,931,506) (122,427,313)
--------------- -----------------
Net decrease (13,887,336) $ (113,825,151)
=============== =================
Class C Shares for the Year Dollar
Ended August 31, 2005 Shares Amount
Shares sold 153,023 $ 1,456,895
Shares redeemed (2,117,704) (20,000,455)
--------------- -----------------
Net decrease (1,964,681) $ (18,543,560)
=============== =================
MERRILL LYNCH GLOBAL GROWTH FUND, INC.AUGUST 31, 2005
Notes to Financial Statements (concluded)
Class C Shares for the Year Dollar
Ended August 31, 2004 Shares Amount
Shares sold 308,528 $ 2,566,158
Shares redeemed (2,757,830) (22,547,416)
--------------- -----------------
Net decrease (2,449,302) $ (19,981,258)
=============== =================
Class I Shares for the Year Dollar
Ended August 31, 2005 Shares Amount
Shares sold 1,960,452 $ 19,328,613
Shares issued to shareholders in
reinvestment of dividends 30,133 297,417
--------------- -----------------
Total issued 1,990,585 19,626,030
Shares redeemed (3,824,180) (37,876,778)
--------------- -----------------
Net decrease (1,833,595) $ (18,250,748)
=============== =================
Class I Shares for the Year Dollar
Ended August 31, 2004 Shares Amount
Shares sold 2,353,975 $ 19,989,818
Shares redeemed (7,454,281) (64,226,677)
--------------- -----------------
Net decrease (5,100,306) $ (44,236,859)
=============== =================
Class R Shares for the Year Dollar
Ended August 31, 2005 Shares Amount
Shares sold 67,626 $ 670,119
Shares issued to shareholders in
reinvestment of dividends 32 303
--------------- -----------------
Total issued 67,658 670,422
Shares redeemed (19,765) (191,392)
--------------- -----------------
Net increase 47,893 $ 479,030
=============== =================
Class R Shares for the Year Dollar
Ended August 31, 2004 Shares Amount
Shares sold 21,035 $ 187,377
Shares redeemed (1,230) (10,395)
--------------- -----------------
Net increase 19,805 $ 176,982
=============== =================
The Fund generally charges a 2% redemption fee on the proceeds (calculated at
market value) of a redemption (either by sale or exchange) of Fund shares made
within 30 days of purchase. The redemption fee is paid to the Fund and is
intended to offset the trading costs, market impact and other costs associated
with short-term trading into and out of the Fund.
5. Short-Term Borrowings:
The Fund, along with certain other funds managed by MLIM and its affiliates,
is a party to a $500,000,000 credit agreement with a group of lenders, which
expires November 2005. The Fund may borrow under the credit agreement to fund
shareholder redemptions and for other lawful purposes other than for leverage.
The Fund may borrow up to the maximum amount allowable under the fund's
current prospectus and statement of additional information, subject to various
other legal, regulatory or contractual limits. The Fund pays a commitment fee
of .07% per annum based on the Fund's pro rata share of the unused portion of
the credit agreement. Amounts borrowed under the credit agreement bear
interest at a rate equal to, at each fund's election, the federal funds rate
plus .50% or a base rate as defined in the credit agreement. The Fund did not
borrow under the credit agreement during the year ended August 31, 2005.
6. Commitments:
At August 31, 2005, the Fund had entered into foreign exchange contracts,
under which it had agreed to purchase and sell various foreign currencies with
approximate values of $40,341,000 and $22,726,000, respectively.
7. Distributions to Shareholders:
The tax character of distributions paid during the fiscal years ended August
31, 2005 and August 31, 2004 was as follows:
8/31/2005 8/31/2004
Distributions paid from:
Ordinary income $ 347,033 --
--------------- -----------------
Total taxable distributions $ 347,033 --
=============== =================
As of August 31, 2005, the components of accumulated losses on a tax basis
were as follows:
Undistributed ordinary income--net $ 4,110,410
Undistributed long-term capital gains--net --
-----------------
Total undistributed earnings--net 4,110,410
Capital loss carryforward (530,853,842)*
Unrealized gains--net 62,095,333**
-----------------
Total accumulated losses--net $ (464,648,099)
=================
* On August 31, 2005, the Fund had a net capital loss carryforward
of $530,853,842, of which $11,892,408 expires in 2008,
$3,964,136 expires in 2009, $162,448,399 expires in 2010 and
$352,548,899 expires in 2011. This amount will be available to
offset like amounts of any future taxable gains.
** The difference between book-basis and tax-basis net unrealized
gains is attributable primarily to the tax deferral of losses on wash
sales and the realization for tax purposes of unrealized gains
(losses) on certain foreign currency contracts.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Directors of
Merrill Lynch Global Growth Fund, Inc.:
We have audited the accompanying statement of assets and liabilities of
Merrill Lynch Global Growth Fund, Inc., including the schedule of investments,
as of August 31, 2005, and the related statement of operations for the year
then ended, the statements of changes in net assets for each of the two years
in the period then ended and the financial highlights for each of the periods
indicated therein. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. We were not engaged to perform an audit of the Fund's internal
controls over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the Fund's internal control
over financial reporting. Accordingly, we express no such opinion. An audit
also includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements and financial highlights, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. Our procedures
included confirmation of securities owned as of August 31, 2005, by
correspondence with the custodian and brokers. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Merrill Lynch Global Growth Fund, Inc. at August 31, 2005, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the indicated periods in conformity with U.S. generally accepted accounting
principles.
(Ernst & young LLP)
Philadelphia, Pennsylvania
October 14, 2005
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Officers and Directors
Number of
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years Director Director
Interested Director
Robert C. Doll, Jr.* President 2005 to President of the MLIM/FAM-advised funds since 130 Funds None
P.O. Box 9011 and present 2005; President of MLIM and FAM since 2001; 175 Portfolios
Princeton, Director Co-Head (Americas Region) thereof from 2000
NJ 08543-9011 to 2001 and Senior Vice President from 1999
Age: 51 to 2001; President and Director of Princeton
Services, Inc. ("Princeton Services") since 2001;
President of Princeton Administrators, L.P.
("Princeton Administrators") since 2001; Chief
Investment Officer of Oppenheimer Funds, Inc.
in 1999 and Executive Vice President thereof
from 1991 to 1999.
* Mr. Doll is a director, trustee or member of an advisory board of certain other
investment companies for which MLIM or FAM acts as investment adviser. Mr. Doll
is an "interested person," as defined in the Investment Company Act, of the Fund
based on his current positions with MLIM, FAM, Princeton Services and Princeton
Administrators. Directors serve until their resignation, removal or death, or
until December 31 of the year in which they turn 72. As Fund President, Mr. Doll
serves at the pleasure of the Board of Directors.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Officers and Directors (continued)
Number of
Portfolios in Other Public
Position(s) Length of Fund Complex Directorships
Held with Time Overseen by Held by
Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years Director Director
Independent Directors*
Donald W. Burton Director 2002 to General Partner of The Burton Partnership, 23 Funds ITC DeltaCom,
P.O. Box 9095 present Limited Partnership (an investment partnership) 42 Portfolios Inc.; Symbion
Princeton, since 1979; Managing General Partner of The Inc.
NJ 08543-9095 South Atlantic Venture Funds since 1983; Member
Age: 61 of the Investment AdvisoryCouncil of the Florida
State Board of Administration since 2001.
John Francis O'Brien Director 2005 to President and Chief Executive Officer of 23 Funds ABIOMED
P.O. Box 9095 present Allmerica Financial Corporation (financial 42 Portfolios (medical device
Princeton, services holding company) from 1995 to 2002 and manufacturer),
NJ 08543-9095 Director from 1995 to 2003; President of Cabot
Age: 62 Allmerica Investment Management Co., Inc. Corporation
(investment adviser) from 1989 to 2002, (chemicals),
Director from 1989 to 2002 and Chairman of the LKQ Corporation
Board from 1989 to 1990; President, Chief (auto parts
Executive Officer and Director of First manufacturing)
Allmerica Financial Life Insurance Company and TJX
from 1989 to 2002 and Director of various other Companies, Inc.
Allmerica Financial companies until 2002; (retailer)
Director since 1989 and Member of the Governance
Nominating Committee since 2004, Member of the
Compensation Committee of ABIOMED since 1989 and
Member of the Audit Committee of ABIOMED from
1990 to 2004; Director and Member of the
Governance and Nomination Committee of Cabot
Corporation and member of the Audit Committee since
1990; Director and Member of the Audit Committee
and Compensation Committee of LKQ Corporation
since 2003; Lead Director of TJX Companies,
Inc. since 1999; Trustee of the Woods Hole
Oceanographic Institute since 2003.
Laurie Simon Hodrick Director 1999 to Professor of Finance and Economics, Graduate 23 Funds None
P.O. Box 9095 present School of Business, Columbia University since 42 Portfolios
Princeton, 1998.
NJ 08543-9095
Age: 42
David H. Walsh Director 2003 to Consultant with Putnam Investments from 1993 23 Funds None
P.O. Box 9095 present to 2003, and employed in various capacities 42 Portfolios
Princeton, from 1973 to 1992; Director, The National
NJ 08543-9095 Audubon Society since 1998; Director, The
Age: 63 American Museum of Fly Fishing since 1997.
Fred G. Weiss** Director 1998 to Managing Director of FGW Associates since 23 Funds Watson
P.O. Box 9095 present 1997; Vice President, Planning, Investment 42 Portfolios Pharmaceuticals,
Princeton, and Development of Warner Lambert Co. from Inc.
NJ 08543-9095 1979 to 1997; Director of the Michael J. Fox
Age: 64 Foundation for Parkinson's Research since 2000;
Director of BTG International Plc (a global
technology commercialization company)
since 2001.
* Directors serve until their resignation, removal or death, or until December 31
of the year in which they turn 72.
** Chairman of the Board and the Audit Committee.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Officers and Directors (concluded)
Position(s) Length of
Held with Time
Name, Address & Age Fund Served Principal Occupation(s) During Past 5 Years
Fund Officers*
Donald C. Burke Vice 1997 to First Vice President of MLIM and FAM since 1997 and Treasurer thereof since 1999;
P.O. Box 9011 President present Senior Vice President and Treasurer of Princeton Services since 1999 and Director
Princeton, and and since 2004; Vice President of FAM Distributors, Inc. ("FAMD") since 1999; Vice
NJ 08543-9011 Treasurer 1999 to President of MLIM and FAM from 1990 to 1997; Director of Taxation of MLIMfrom
Age: 45 present 1990 to 2001; Vice President, Treasurer and Secretary of the IQ Funds since 2004.
Lawrence R. Fuller Vice 1997 to Managing Director (Equities) of MLIM since 2000; Director of MLIM from 1997
P.O. Box 9011 President present to 2000.
Princeton,
NJ 08543-9011
Age: 64
Jeffrey Hiller Chief 2004 to Chief Compliance Officer of the MLIM/FAM-advised funds and First Vice President
P.O. Box 9011 Compliance present and Chief Compliance Officer of MLIM (Americas Region) since 2004; Chief
Princeton, Officer Compliance Officer of the IQ Funds since 2004; Global Director of Compliance at
NJ 08543-9011 Morgan Stanley Investment Management from 2002 to 2004; Managing Director and Global
Age: 54 Director of Compliance at Citigroup Asset Management from 2000 to 2002; Chief
Compliance Officer at Soros Fund Management in 2000; Chief Compliance Officer at
Prudential Financial from 1995 to 2000; Senior Counsel in the Commission's Division
of Enforcement in Washington, D.C. from 1990 to 1995.
Alice A. Pellegrino Secretary 2004 to Director (Legal Advisory) of MLIM since 2002; Vice President of MLIM from 1999 to
P.O. Box 9011 present 2002; Attorney associated with MLIM since 1997; Secretary of MLIM, FAM, FAMD
Princeton, and Princeton Services since 2004.
NJ 08543-9011
Age: 45
* Officers of the Fund serve at the pleasure of the Board of Directors.
Further information about the Fund's Officers and Directors is available in
the Fund's Statement of Additional Information, which can be obtained without
charge by calling 1-800-MER-FUND.
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
800-637-3863
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Availability of Quarterly Schedule of Investments
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission ("SEC") for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Forms N-Q are available on the SEC's Web site at
http://www.sec.gov. The Fund's Forms N-Q may also be reviewed and copied at the
SEC's Public Reference Room in Washington, DC. Information on the operation of
the Public Reference Room may be obtained by calling 1-800-SEC-0330.
Electronic Delivery
The Fund offers electronic delivery of communications to its shareholders. In
order to receive this service, you must register your account and provide us
with e-mail information. To sign up for this service, simply access this Web
site at http://www.icsdelivery.com/live and follow the instructions. When you
visit this site, you will obtain a personal identification number (PIN). You
will need this PIN should you wish to update your e-mail address, choose to
discontinue this service and/or make any other changes to the service. This
service is not available for certain retirement accounts at this time.
MERRILL LYNCH GLOBAL GROWTH FUND, INC. AUGUST 31, 2005
Item 2 - Code of Ethics - The registrant has adopted a code of ethics, as of
the end of the period covered by this report, that applies to the
registrant's principal executive officer, principal financial
officer and principal accounting officer, or persons performing
similar functions. A copy of the code of ethics is available
without charge upon request by calling toll-free 1-800-MER-FUND
(1-800-637-3863).
Item 3 - Audit Committee Financial Expert - The registrant's board of
directors has determined that (i) the registrant has the following
audit committee financial experts serving on its audit committee and
(ii) each audit committee financial expert is independent: (1)
Donald W. Burton, (2) M. Colyer Crum (retired as of December 31,
2004), (3) Laurie Simon Hodrick, (4) John F. O'Brien (as of November
22, 2004), (5) David H. Walsh and (6) Fred G. Weiss.
The registrant's board of directors has determined that Laurie Simon
Hodrick and M. Colyer Crum qualify as financial experts pursuant to
Item 3(c)(4) of Form N-CSR.
Ms. Hodrick has a thorough understanding of generally accepted
accounting principals, financial statements, and internal controls
and procedures for financial reporting. Ms. Hodrick earned a Ph.D.
in economics and has taught courses in finance for over 15 years.
Her M.B.A.-level course centers around the evaluation and analysis
of firms' corporate financial statements. She has also taught in
financial analysts' training programs. Ms. Hodrick has also worked
with several prominent corporations in connection with the analysis
of financial forecasts and projections and analysis of the financial
statements of those companies, serving on the Financial Advisory
Council of one of these major corporations. She has also served as
the Treasurer and Finance Chair of a 501(c)(3) organization. Ms.
Hodrick has published a number of articles in leading economic and
financial journals and is the associate editor of two leading
finance journals.
M. Colyer Crum also possesses a thorough understanding of generally
accepted accounting principals, financial statements, and internal
controls and procedures for financial reporting through a
combination of education and experience. Professor Crum was a
professor of investment management at the Harvard Business School
for 25 years. The courses taught by Professor Crum place a heavy
emphasis on the analysis of underlying company financial statements
with respect to stock selection and the analysis of credit risk in
making loans. Professor Crum has also served on a number of boards
of directors and has served on the audit committees, and in some
cases chaired the audit committee, for several major corporations
and financial institutions. For two such organizations, Professor
Crum has performed extensive investment analysis of financial
statements in connection with investment management decisions. From
these experiences, he has gained significant experience with the
establishment of reserves and accounting policies, differences
between U.S. GAAP and Canadian GAAP and executive compensation
issues.
Item 4 - Principal Accountant Fees and Services
(a) Audit Fees - Fiscal Year Ending August 31, 2005 - $40,000
Fiscal Year Ending August 31, 2004 - $38,000
(b) Audit-Related Fees -Fiscal Year Ending August 31, 2005 - $0
Fiscal Year Ending August 31, 2004 - $0
(c) Tax Fees - Fiscal Year Ending August 31, 2005 - $5,700
Fiscal Year Ending August 31, 2004 - $5,200
The nature of the services include tax compliance, tax advice and
tax planning.
(d) All Other Fees - Fiscal Year Ending August 31, 2005 - $0
Fiscal Year Ending August 31, 2004 - $0
(e)(1) The registrant's audit committee (the "Committee") has
adopted policies and procedures with regard to the pre-approval of
services. Audit, audit-related and tax compliance services provided
to the registrant on an annual basis require specific pre-approval
by the Committee. The Committee also must approve other non-audit
services provided to the registrant and those non-audit services
provided to the registrant's affiliated service providers that
relate directly to the operations and the financial reporting of the
registrant. Certain of these non-audit services that the Committee
believes are a) consistent with the SEC's auditor independence rules
and b) routine and recurring services that will not impair the
independence of the independent accountants may be approved by the
Committee without consideration on a specific case-by-case basis
("general pre-approval"). However, such services will only be
deemed pre-approved provided that any individual project does not
exceed $5,000 attributable to the registrant or $50,000 for all of
the registrants the Committee oversees. Any proposed services
exceeding the pre-approved cost levels will require specific pre-
approval by the Committee, as will any other services not subject to
general pre-approval (e.g., unanticipated but permissible services).
The Committee is informed of each service approved subject to
general pre-approval at the next regularly scheduled in-person board
meeting.
(e)(2) 0%
(f) Not Applicable
(g) Fiscal Year Ending August 31, 2005 - $5,700
Fiscal Year Ending August 31, 2004 - $5,200
(h) The registrant's audit committee has considered and determined
that the provision of non-audit services that were rendered to the
registrant's investment adviser and any entity controlling,
controlled by, or under common control with the investment adviser
that provides ongoing services to the registrant that were not pre-
approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation
S-X is compatible with maintaining the principal accountant's
independence.
Regulation S-X Rule 2-01(c)(7)(ii) - $0, 0%
Item 5 - Audit Committee of Listed Registrants - Not Applicable
Item 6 - Schedule of Investments - Not Applicable
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 - Not Applicable
Item 11 - Controls and Procedures
11(a) - The registrant's certifying officers have reasonably designed such
disclosure controls and procedures to ensure material information
relating to the registrant is made known to us by others
particularly during the period in which this report is being
prepared. The registrant's certifying officers have determined that
the registrant's disclosure controls and procedures are effective
based on our evaluation of these controls and procedures as of a
date within 90 days prior to the filing date of this report.
11(b) - There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act
(17 CFR 270.30a-3(d)) that occurred during the second fiscal half-
year of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 12 - Exhibits attached hereto
12(a)(1) - Code of Ethics - See Item 2
12(a)(2) - Certifications - Attached hereto
12(a)(3) - Not Applicable
12(b) - Certifications - Attached hereto
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.
Merrill Lynch Global Growth Fund, Inc.
By: /s/ Robert C. Doll, Jr.
-------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
Merrill Lynch Global Growth Fund, Inc.
Date: October 19, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on
the dates indicated.
By: /s/ Robert C. Doll, Jr.
-------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
Merrill Lynch Global Growth Fund, Inc.
Date: October 19, 2005
By: /s/ Donald C. Burke
-------------------------------
Donald C. Burke,
Chief Financial Officer of
Merrill Lynch Global Growth Fund, Inc.
Date: October 19, 2005