Item 1. Report to Shareholders
T. Rowe Price Blue Chip Growth Fund
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December 31, 2003
Certified Annual Report
This report is certified under the Sarbanes-Oxley Act of 2002, which requires
that public companies, including mutual funds, affirm that the information
provided in their annual and semiannual shareholder reports fully and fairly
represents their financial position.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report
Performance Comparison
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This chart shows the value of a hypothetical $10,000 investment in the fund over
the past 10 fiscal year periods or since inception (for funds lacking 10-year
records). The result is compared with benchmarks, which may include a
broad-based market index and a peer group average or index. Market indexes do
not include expenses, which are deducted from fund returns as well as mutual
fund averages and indexes.
[Graphic Omitted]
BLUE CHIP GROWTH FUND
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As of 12/31/03
Blue Chip Growth Fund $28,722
S&P 500 Stock Index $28,563
Lipper Large-Cap Core Funds Index $24,271
Lipper
S&P 500 Large-Cap Blue Chip
Stock Core Funds Growth
Index Index Fund
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12/93 $10,000 $10,000 $10,000
12/94 10,132 9,892 10,080
12/95 13,940 13,033 13,900
12/96 17,140 15,620 17,758
12/97 22,859 20,184 22,653
12/98 29,392 25,621 29,186
12/99 35,576 30,578 35,022
12/00 32,337 28,325 34,137
12/01 28,493 24,689 29,215
12/02 22,196 19,447 22,136
12/03 28,563 24,271 28,722
Note: Performance for the Advisor and R Class shares will vary due to their
differing fee structures. See returns table on the next page.
Average Annual Compound Total Return
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Since Inception
Periods Ended 12/31/03 1 Year 5 Years 10 Years Inception Date
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Blue Chip Growth Fund 29.75% -0.32% 11.13% - -
S&P 500 Stock Index 28.68 -0.57 11.07
Lipper Large-Cap Growth
Funds Index 26.96 -5.53 7.77
Lipper Large-Cap Core
Funds Index 24.80 -1.08 9.27
Blue Chip Growth Fund-
Advisor Class 29.77 - - -6.64% 3/31/00
S&P 500 Stock Index 28.68 - - -6.24*
Lipper Large-Cap Core
Funds Index 24.80 - - -7.01*
Lipper Large-Cap Growth
Funds Index 26.96 - - -16.15*
Blue Chip Growth Fund-
R Class 29.23 - - 30.20 9/30/02
S&P 500 Stock Index 28.68 - - 30.51**
Lipper Large-Cap Core
Funds Index 24.80 - - 25.68**
Lipper Large-Cap Growth
Funds Index 26.96 - - 25.20**
* Benchmark since-inception data are for the time period 3/31/00-12/31/03.
** Benchmark since-inception data are for the time period 9/30/02-12/31/03.
Returns do not reflect taxes that the shareholder may pay on fund distributions
or the redemption of fund shares. Past performance cannot guarantee future
results.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report
Dear Shareholder,
We are pleased to report that the Blue Chip Growth Fund, Blue Chip Growth
Fund-Advisor Class, and Blue Chip Growth Fund-R Class generated solid returns
for the 12-month period ended December 31, 2003. The fund's 2003 return outpaced
the Lipper Large-Cap Core Funds Index and the S&P 500 Stock Index. The fund
especially benefited from stock selection in the telecom services and health
care sectors.
As you know, the fund's investment objective is to provide long-term capital
growth through investments primarily in large and medium-sized, high-quality
U.S. growth stocks. These are firms that, in our view, are well established in
their industries and have the potential for above-average earnings and cash flow
growth.
[Graphic Omitted]
Major Index Returns
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Period Ended 12/31/03
12-Month Return
S&P 500 Stock Index 29%
S&P MidCap 400 Index 36%
Russell 2000 Index 47%
Nasdaq Composite 50%
The Major Index Returns table shows how various domestic stock market benchmarks
performed over the past 12 months. As you can see, domestic stocks registered
solid returns, with the technology-laden Nasdaq Composite and the small-cap
Russell 2000 Index showing the best results. Mid-cap stocks outperformed
large-cap stocks, as represented by the S&P 500 Stock Index.
The Top 5 Sectors table shows how the fund's assets were allocated as of
December 31, 2003. Financials were the largest sector allocation at 23.4% of net
assets, down from 25.8% a year earlier. Health care holdings were trimmed to
17.3% from 20.3%, while our allocation to consumer discretionary stocks rose to
16.3% from 12.9% at the end of 2002.
Top 5 Sectors
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Percent of Net Assets
12/31/02 12/31/03
Financials 25.8% 23.4%
Information Technology 21.1 21.7
Health Care 20.3 17.3
Consumer Discretionary 12.9 16.3
Industrials and Business Services 7.6 9.2
For comparison purposes, we have restated the historical weightings to
incorporate changes to the sector and industry classification system.
The Best and Worst Conributors table shows the best and worst contributors to
the fund's performance during the year. Diversified financial services giant
Citigroup and communications equipment provider Cisco Systems were the top
positive contributors, while health care services provider HCA was the worst
detractor.
Best and Worst Contributors
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12 Months Ended 12/31/03
Best Contributors
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Citigroup
Cisco Systems
UnitedHealth Group
Nextel Communications
Tyco International
Worst Contributors
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HCA **
Freddie Mac
Baxter International **
Automatic Data Processing **
Johnson & Johnson
** Position eliminated
Finally, I'm sure you are aware that mutual fund companies have recently come
under scrutiny for their trading policies. The investigations have led to
allegations that executives of several mutual fund companies permitted or
engaged in improper mutual fund trading. In addition, certain intermediaries
that process fund transactions are alleged to have assisted some investors in
executing improper mutual fund trades. I want T. Rowe Price shareholders to know
that we emphatically condemn the abuses that have been revealed or alleged
against other firms in our industry. Our firm has not entered and will not enter
into any agreements with any investors or intermediaries that authorize
after-hours trading or excessive short-term trading in any of our funds. T. Rowe
Price investors can be assured that our firm unequivocally opposes illegal or
inappropriate trading of any nature and has policies and procedures in place
designed to protect the best interests of our long-term shareholders. No T. Rowe
Price executives or portfolio managers or investment personnel of the T. Rowe
Price mutual funds have engaged in any inappropriate trading of T. Rowe Price
mutual funds. You may find out more about our trading policies and the steps we
take to protect your interests by visiting our Web site (troweprice.com). These
policies are also spelled out in your fund's prospectus.
We thank you for your continued support.
Respectfully,
James S. Riepe
Chairman
January 20, 2004
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report
Financial Highlights For a share outstanding throughout each period
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Blue Chip Growth Class
Year
Ended
12/31/03 12/31/02 12/31/01 12/31/00 12/31/99
NET ASSET VALUE
Beginning of period $ 21.95 $ 28.97 $ 33.85 $ 36.34 $ 30.60
Investment activities
Net investment
income (loss) 0.02 - (0.02) (0.03) 0.03
Net realized and
unrealized gain (loss) 6.51 (7.02) (4.86) (0.84) 6.07
Total from
investment activities 6.53 (7.02) (4.88) (0.87) 6.10
Distributions
Net investment income (0.03) - - - (0.03)
Net realized gain - - - (1.62) (0.33)
Total distributions (0.03) - - (1.62) (0.36)
NET ASSET VALUE
End of period $ 28.45 $ 21.95 $ 28.97 $ 33.85 $ 36.34
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Ratios/Supplemental Data
Total return^ 29.75% (24.23)% (14.42)% (2.53)% 20.00%
Ratio of total expenses
to average net assets 0.95% 0.96% 0.96% 0.91% 0.91%
Ratio of net investment
income (loss) to average
net assets 0.10% 0.00% (0.06)% (0.09)% 0.10%
Portfolio turnover rate 32.6% 46.2% 48.3% 50.9% 41.3%
Net assets, end of period
(in millions) $ 6,300 $ 4,482 $ 6,242 $ 7,113 $ 6,709
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report
Financial Highlights For a share outstanding throughout each period
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Advisor Class
Year 3/31/00
Ended Through
12/31/03 12/31/02 12/31/01 12/31/00
NET ASSET VALUE
Beginning of period $ 21.97 $ 29.02 $ 33.91 $ 38.63
Investment activities
Net investment
income (loss) 0.02 - (0.01) 0.02*
Net realized and
unrealized gain (loss) 6.52 (7.04) (4.88) (3.12)
Total from
investment activities 6.54 (7.04) (4.89) (3.10)
Distributions
Net investment income (0.03) - - -
Net realized gain - - - (1.62)
Tax return of capital - (0.01) - -
Total distributions (0.03) (0.01) - (1.62)
NET ASSET VALUE
End of period $ 28.48 $ 21.97 $ 29.02 $ 33.91
--------------------------------------------------
Ratios/Supplemental Data
Total return^ 29.77% (24.26)% (14.42)% (8.15)%
Ratio of total expenses to
average net assets 0.98% 0.99% 0.99% 0.69%!
Ratio of net investment
income (loss) to average
net assets 0.07% (0.01)% (0.04)% 0.25%!
Portfolio turnover rate 32.6% 46.2% 48.3% 50.9%
Net assets, end of period
(in thousands) $ 769,970 $ 538,571 $ 469,089 $ 2,831
* The amount presented is calculated pursuant to a methodology prescribed by the
Securities and Exchange Commission for a share outstanding throughout the
period. The per-share amounts for the investment activities of the Advisor
Class may be inconsistent with the aggregate amounts presented elsewhere in
the financial statements for the fund, due to the partial year of operations
for the Advisor Class and the timing of sales and redemptions of shares in
relation to fluctuating market values for the investment portfolio.
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
! Annualized
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report
Financial Highlights For a share outstanding throughout each period
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R Class
Year 9/30/02
Ended Through
12/31/03 12/31/02
NET ASSET VALUE
Beginning of period $ 21.93 $ 20.37
Investment activities
Net investment income (loss) (0.01)* (0.02)*
Net realized and unrealized gain (loss) 6.42 1.58**
Total from investment activities 6.41 1.56
Distributions
Net investment income (0.03) -
NET ASSET VALUE
End of period $ 28.31 $ 21.93
---------------------------
Ratios/Supplemental Data
Total return^ 29.23%* 7.66%*
Ratio of total expenses to
average net assets 1.35%* 1.35%!*
Ratio of net investment
income (loss) to average
net assets (0.25%)* (0.28%)!*
Portfolio turnover rate 32.6% 46.2%!
Net assets, end of period
(in thousands) $ 1,509 $ 108
* Excludes expenses in excess of a 1.35% contractual expense limitation in
effect through 4/30/06.
** The amount presented is calculated pursuant to a methodology prescribed by
the Securities and Exchange Commission for a share outstanding throughout the
period. This amount is inconsistent with the fund's aggregate gains and
losses because of the timing of sales and redemptions of fund shares in
relation to fluctuating market values for the investment portfolio.
^ Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
! Annualized
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report December 31, 2003
Portfolio of Investments (ss.) Shares Value
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($ 000s)
COMMON STOCKS 100.4%
CONSUMER DISCRETIONARY 16.3%
Automobiles 1.0%
Harley-Davidson 1,500,000 71,295
71,295
Hotels, Restaurants & Leisure 2.8%
Carnival 1,500,000 59,595
International Game Technology 2,000,000 71,400
McDonald's 1,000,000 24,830
MGM Mirage * 340,000 12,787
Starbucks * 910,000 30,085
198,697
Internet & Catalog Retail 0.6%
eBay * 640,000 41,338
41,338
Media 8.4%
Clear Channel Communications 2,170,000 101,621
Comcast, Class A * 2,575,000 80,546
Disney 1,000,000 23,330
EchoStar Communications, Class A * 1,600,000 54,400
Omnicom 532,000 46,459
Scripps, Class A 520,000 48,953
Time Warner * 3,400,000 61,166
Univision Communications, Class A * 1,540,000 61,123
Viacom, Class B 2,660,000 118,051
595,649
Multiline Retail 1.3%
Family Dollar Stores 70,000 2,512
Kohl's * 10,000 449
Target 2,230,000 85,632
88,593
Specialty Retail 2.2%
Best Buy 890,000 46,493
Home Depot 3,000,000 106,470
TJX 100,000 2,205
155,168
Total Consumer Discretionary 1,150,740
CONSUMER STAPLES 5.3%
Beverages 1.8%
Coca-Cola 1,500,000 76,125
PepsiCo 1,150,000 53,613
129,738
Food & Staples Retailing 2.0%
Sysco 1,210,000 45,048
Wal-Mart 1,630,000 86,471
Walgreen 325,000 11,824
143,343
Food Products 0.1%
General Mills 100,000 4,530
4,530
Household Products 0.3%
Procter & Gamble 190,000 18,977
18,977
Personal Products 0.5%
Estee Lauder, Class A 370,000 14,526
Gillette 550,000 20,202
34,728
Tobacco 0.6%
Altria Group 770,000 41,904
41,904
Total Consumer Staples 373,220
ENERGY 2.8%
Energy Equipment & Services 2.8%
Baker Hughes 1,810,000 58,210
BJ Services * 790,000 28,361
Schlumberger 1,300,000 71,136
Smith International * 1,000,000 41,520
199,227
Oil & Gas 0.0%
Exxon Mobil 40,000 1,640
1,640
Total Energy 200,867
FINANCIALS 23.4%
Capital Markets 8.5%
Bank of New York 1,000,000 33,120
Charles Schwab 2,500,000 29,600
Franklin Resources 820,000 42,689
Goldman Sachs Group 675,000 66,643
Legg Mason 442,000 34,114
Mellon Financial 2,320,000 74,495
Merrill Lynch 1,550,000 90,907
Morgan Stanley 1,300,000 75,231
Northern Trust 1,120,000 51,990
State Street 2,000,000 104,160
602,949
Commercial Banks 3.0%
Bank of America 890,000 71,583
U.S. Bancorp 2,410,000 71,770
Wells Fargo 1,180,000 69,490
212,843
Consumer Finance 1.6%
American Express 1,120,000 54,018
SLM Corporation 1,580,000 59,534
113,552
Diversified Financial Services 4.0%
Citigroup 5,830,000 282,988
282,988
Insurance 4.6%
Ambac 50,000 3,470
American International Group 2,350,000 155,758
Hartford Financial Services 950,000 56,078
Marsh & McLennan 1,300,000 62,257
Travelers Property Casualty, Class A 2,800,000 46,984
324,547
Thrifts & Mortgage Finance 1.7%
Fannie Mae 1,300,000 97,578
Freddie Mac 300,000 17,496
115,074
Total Financials 1,651,953
HEALTH CARE 17.2%
Biotechnology 2.6%
Amgen * 1,580,000 97,644
Genentech * 280,000 26,200
Gilead Sciences * 790,000 45,930
MedImmune * 460,000 11,684
181,458
Health Care Equipment & Supplies 1.8%
Boston Scientific * 1,120,000 41,171
Guidant 160,000 9,632
Medtronic 1,240,000 60,277
Stryker 235,000 19,977
131,057
Health Care Providers & Services 5.0%
AmerisourceBergen 25,000 1,404
Anthem * 100,000 7,500
Cardinal Health 275,000 16,819
Medco * 400,000 13,596
UnitedHealth Group, 3,815,000 221,957
WellPoint Health Networks * 950,000 92,140
353,416
Pharmaceuticals 7.8%
Abbott Laboratories 1,150,000 53,590
Eli Lilly 610,000 42,901
Forest Laboratories * 1,150,000 71,070
Johnson & Johnson 1,500,000 77,490
Pfizer 7,450,000 263,209
Wyeth 1,000,000 42,450
550,710
Total Health Care 1,216,641
INDUSTRIALS & BUSINESS SERVICES 9.2%
Aerospace & Defense 0.7%
General Dynamics 275,000 24,857
Honeywell International 100,000 3,343
Lockheed Martin 400,000 20,560
48,760
Air Freight & Logistics 0.7%
UPS, Class B 655,000 48,830
48,830
Commercial Services & Supplies 1.9%
Apollo Group, Class A * 1,162,000 79,016
Cendant * 1,450,000 32,292
ChoicePoint * 325,000 12,379
Waste Management 275,000 8,140
131,827
Industrial Conglomerates 3.6%
3M 220,000 18,707
General Electric 4,100,000 127,018
Tyco International 4,000,000 106,000
251,725
Machinery 2.3%
Danaher 1,400,000 128,450
Deere 415,000 26,996
Illinois Tool Works 130,000 10,908
166,354
Total Industrials & Business Services 647,496
INFORMATION TECHNOLOGY 21.2%
Communications Equipment 3.2%
Cisco Systems * 6,600,000 160,314
Nokia ADR 1,700,000 28,900
QLogic * 400,000 20,640
QUALCOMM 325,000 17,527
Research In Motion * 40,000 2,684
230,065
Computer & Peripherals 2.1%
Dell * 2,900,000 98,484
EMC * 190,000 2,455
IBM 100,000 9,268
Lexmark International * 470,000 36,961
147,168
Internet Software & Services 1.4%
InterActiveCorp * 1,525,000 51,743
Yahoo! * 1,120,000 50,591
102,334
IT Services 3.8%
Accenture, Class A * 1,400,000 36,848
Affiliated Computer Services, Class A * 1,000,000 54,460
First Data 2,500,000 102,725
Fiserv * 1,090,000 43,066
Paychex 370,000 13,764
SunGard Data Systems * 610,000 16,903
267,766
Semiconductor & Semiconductor Equipment 5.2%
Analog Devices 1,510,000 68,931
Applied Materials * 2,200,000 49,390
Intel 2,490,000 80,178
Maxim Integrated Products 1,810,000 90,138
Texas Instruments 1,500,000 44,070
Xilinx * 820,000 31,767
364,474
Software 5.5%
Adobe Systems 790,000 31,047
Intuit * 1,330,000 70,370
Microsoft 7,975,000 219,631
Oracle * 100,000 1,320
Siebel Systems * 1,240,000 17,199
Symantec * 820,000 28,413
Synopsys * 200,000 6,752
VERITAS Software * 400,000 14,864
389,596
Total Information Technology 1,501,403
MATERIALS 0.4%
Metals & Mining 0.4%
Alcoa 790,000 30,020
Total Materials 30,020
TELECOMMUNICATION SERVICES 3.5%
Wireless Telecommunication Services 3.5%
Nextel Communications, Class A * 3,650,000 102,419
Vodafone ADR 5,900,000 147,736
Total Telecommunication Services 250,155
Total Miscellaneous Common Stock 1.1% 74,573
Total Common Stocks (Cost $5,505,392) 7,097,068
SHORT-TERM INVESTMENTS 0.0%
Money Market Fund 0.0%
T. Rowe Price Reserve Investment Fund, 1.13% # 1,000 1
Total Short-Term Investments (Cost $1) 1
Total Investments in Securities
100.4% of Net Assets (Cost $5,505,393) $7,097,069
-----------
(ss.) Denominated in U.S. dollars unless otherwise noted
# Seven-day yield
* Non-income producing
ADR American Depository Receipts
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report December 31, 2003
Statement of Assets and Liabilities
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($ 000s)
Assets
Investments in securities, at value (cost $5,505,393) $ 7,097,069
Other assets 27,454
Total assets 7,124,523
Liabilities
Total liabilities 52,895
NET ASSETS $ 7,071,628
------------
Net Assets Consist of:
Undistributed net realized gain (loss) (1,164,899)
Net unrealized gain (loss) 1,591,676
Paid-in-capital applicable to 248,517,201 shares of
$0.0001 par value capital stock outstanding;
1,000,000,000 shares authorized 6,644,851
NET ASSETS $ 7,071,628
------------
NET ASSET VALUE PER SHARE
Blue Chip Growth Class
($6,300,148,185/221,424,106 shares outstanding) $ 28.45
------------
Advisor Class
($769,970,117/27,039,789 shares outstanding) $ 28.48
------------
R Class
($1,509,286/53,306 shares outstanding) $ 28.31
------------
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Statement of Operations
- --------------------------------------------------------------------------------
($ 000s)
Year
Ended
12/31/03
Investment Income (Loss)
Income
Dividend $ 62,008
Securities lending 31
Total income 62,039
Expenses
Investment management 36,657
Shareholder servicing
Blue Chip Growth Class 16,432
Advisor Class 626
R Class 1
Distribution and service
Advisor Class 1,579
R Class 2
Prospectus and shareholder reports
Blue Chip Growth Class 515
Advisor Class 1
R Class 1
Custody and accounting 284
Registration 95
Legal and audit 38
Directors 31
Miscellaneous 54
Reductions/repayments pursuant to expense limitation
Expenses (reimbursed by) repaid to manager (1)
Total expenses 56,315
Expenses paid indirectly (2)
Net expenses 56,313
Net investment income (loss) 5,726
Statement of Operations
- --------------------------------------------------------------------------------
($ 000s)
Year
Ended
12/31/03
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities (184,241)
Foreign currency transactions (280)
Net realized gain (loss) (184,521)
Change in net unrealized gain (loss) on securities 1,761,118
Net realized and unrealized gain (loss) 1,576,597
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 1,582,323
-----------
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
($ 000s)
Year
Ended
12/31/03 12/31/02
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $ 5,726 $ (111)
Net realized gain (loss) (184,521) (475,496)
Change in net unrealized gain (loss) 1,761,118 (1,152,131)
Increase (decrease) in net assets
from operations 1,582,323 (1,627,738)
Distributions to shareholders
Net investment income
Blue Chip Growth Class (6,682) -
Advisor Class (808) -
R Class (1) -
Tax return of capital
Advisor class - (245)
Decrease in net assets from distributions (7,491) (245)
Capital share transactions *
Shares sold
Blue Chip Growth Class 1,289,603 1,093,942
Advisor Class 196,170 251,622
R Class 1,460 100
Distributions reinvested
Blue Chip Growth Class 6,546 -
Advisor Class 799 244
R Class 1 -
Shares redeemed
Blue Chip Growth Class (883,927) (1,355,267)
Advisor Class (134,017) (53,645)
R Class (216) -
Increase (decrease) in net assets from
capital share transactions 476,419 (63,004)
Net Assets
Increase (decrease) during period 2,051,251 (1,690,987)
Beginning of period 5,020,377 6,711,364
End of period $ 7,071,628 $ 5,020,377
------------------------------
Statement of Changes in Net Assets
- --------------------------------------------------------------------------
($ 000s)
Year
Ended
12/31/03 12/31/02
*Share information
Shares sold
Blue Chip Growth Class 52,766 43,856
Advisor Class 8,044 10,496
R Class 56 5
Distributions reinvested
Blue Chip Growth Class 238 -
Advisor Class 29 11
Shares redeemed
Blue Chip Growth Class (35,804) (55,121)
Advisor Class (5,549) (2,158)
R Class (8) -
Increase (decrease) in shares outstanding 19,772 (2,911)
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Blue Chip Growth Fund
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Certified Annual Report December 31, 2003
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
T. Rowe Price Blue Chip Growth Fund, Inc. (the fund) is registered under
the Investment Company Act of 1940 (the 1940 Act) as a diversified,
open-end management investment company. The fund seeks to provide long-term
capital growth. Income is a secondary objective. The fund has three classes
of shares: Blue Chip Growth (Blue Chip Class), offered since June 30, 1993,
Blue Chip Growth--Advisor Class (Advisor Class), offered since March 31,
2000, and Blue Chip Growth--R Class (R Class), offered since September 30,
2002. Advisor Class shares are sold only through brokers and other
financial intermediaries, and R Class shares are available to retirement
plans serviced by intermediaries. The Advisor Class and R Class each
operate under separate Board-approved Rule 12b-1 plans, pursuant to which
each class compensates financial intermediaries for distribution and
certain administrative services. Each class has exclusive voting rights on
matters related solely to that class, separate voting rights on matters
that relate to all classes, and, in all other respects, the same rights and
obligations as the other classes.
The accompanying financial statements were prepared in accordance with
accounting principles generally accepted in the United States of America,
which require the use of estimates made by fund management.
Valuation
The fund values its investments and computes its net asset value per share
at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET,
each day that the NYSE is open for business. Equity securities listed or
regularly traded on a securities exchange or in the over-the-counter market
are valued at the last quoted sale price, or official closing price for
certain markets, at the time the valuations are made. A security that is
listed or traded on more than one exchange is valued at the quotation on
the exchange determined to be the primary market for such security. Listed
securities not traded on a particular day are valued at the mean of the
latest bid and ask prices for domestic securities and the last quoted sale
price for international securities.
Investments in mutual funds are valued at the mutual fund's closing net
asset value per share on the day of valuation.
Other investments and those for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair
value as determined in good faith by the T. Rowe Price Valuation Committee,
established by the fund's Board of Directors.
Most foreign markets close before the NYSE. Normally, developments that
could affect the values of securities that occur between the close of a
foreign market and the close of the NYSE will not be reflected in security
valuations used by the fund to compute its share price. However, if
developments are so significant that they will, in the judgment of the
fund, clearly and materially affect security values, such valuations may be
adjusted to reflect the estimated fair value of the securities as of the
close of the NYSE, as determined in good faith by the T. Rowe Price
Valuation Committee, established by the fund's Board of Directors.
Currency Translation
Assets, including investments, and liabilities denominated in foreign
currencies are translated into U.S. dollar values each day at the
prevailing exchange rate, using the mean of the bid and ask prices of such
currencies against U.S. dollars as quoted by a major bank. Purchases and
sales of securities, income, and expenses are translated into U.S. dollars
at the prevailing exchange rate on the date of the transaction. The effect
of changes in foreign currency exchange rates on realized and unrealized
security gains and losses is reflected as a component of security gains and
losses.
Class Accounting
The Advisor Class and R Class each pay distribution and administrative
expenses in the form of Rule 12b-1 fees, in an amount not exceeding 0.25%
and 0.50%, respectively, of the class's average daily net assets.
Shareholder servicing, prospectus, and shareholder report expenses incurred
by each class are charged directly to the class to which they relate.
Expenses common to all classes, investment income, and realized and
unrealized gains and losses are allocated to the classes based upon the
relative daily net assets of each class. Income distributions are declared
and paid by each class on an annual basis.
Rebates and Credits
Subject to best execution, the fund may direct certain security trades to
brokers who have agreed to rebate a portion of the related brokerage
commission to the fund in cash. Commission rebates are included in realized
gain on securities in the accompanying financial statements and totaled
$360,000 for the year ended December 31, 2003. Additionally, the fund earns
credits on temporarily uninvested cash balances at the custodian that
reduce the fund's custody charges. Custody expense in the accompanying
financial statements is presented before reduction for credits, which are
reflected as expenses paid indirectly.
Investment Transactions, Investment Income, and Distributions
Income and expenses are recorded on the accrual basis. Dividends received
from mutual fund investments are reflected as dividend income; capital gain
distributions are reflected as realized gain/loss. Dividend income and
capital gain distributions are recorded
on the ex-dividend date. Investment transactions are accounted for on the
trade date. Realized gains and losses are reported on the identified cost
basis. Distributions to shareholders are recorded on the ex-dividend date.
Income distributions are declared and paid on an annual basis. Capital gain
distributions, if any, are typically declared and paid on an annual basis.
Other
In the normal course of business, the fund enters into contracts that
provide general indemnifications. The fund's maximum exposure under these
arrangements is dependent on claims that may be made against the fund in
the future and, therefore, cannot be estimated; however, based on
experience, the risk of material loss from such claims is considered
remote.
NOTE 2 - INVESTMENT TRANSACTIONS
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
Securities Lending
The fund lends its securities to approved brokers to earn additional
income. It receives as collateral cash and U.S. government securities
valued at 102% to 105% of the value of the securities on loan. Cash
collateral is invested in a money market pooled trust managed by the fund's
lending agent in accordance with investment guidelines approved by fund
management. Collateral is maintained over the life of the loan in an amount
not less than the value of loaned securities, as determined at the close of
fund business each day; any additional collateral required due to changes
in security values is delivered to the fund the next business day. Although
risk is mitigated by the collateral, the fund could experience a delay in
recovering its securities and a possible loss of income or value if the
borrower fails to return the securities. Securities lending revenue
recognized by the fund consists of earnings on invested collateral and
borrowing fees, net of any rebates to the borrower and compensation to the
lending agent. At December 31, 2003, there were no securities on loan.
Other
Purchases and sales of portfolio securities, other than short-term
securities, aggregated $2,423,778,000 and $1,919,079,000, respectively, for
the year ended December 31, 2003.
NOTE 3 - FEDERAL INCOME TAXES
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company under Subchapter M of
the Internal Revenue Code and distribute to shareholders all of its taxable
income and gains. Federal income tax regulations differ from generally
accepted accounting principles; therefore, distributions determined in
accordance with tax regulations may differ significantly in amount or
character from net investment income and realized gains for financial
reporting purposes. Financial reporting records are adjusted for permanent
book/tax differences to reflect tax character. Financial records are not
adjusted for temporary differences.
Distributions during the year ended December 31, 2003 totaled $7,491,000
and were characterized as ordinary income for tax purposes. At December 31,
2003, the tax-basis components of net assets were as follows:
- --------------------------------------------------------------------------------
Unrealized appreciation $ 1,678,622,000
Unrealized depreciation (90,383,000)
Net unrealized appreciation (depreciation) 1,588,239,000
Capital loss carryforwards (1,161,462,000)
Paid-in capital 6,644,851,000
Net assets $ 7,071,628,000
--------------------
Pursuant to federal income tax regulations applicable to investment
companies, the fund has elected to treat net capital losses realized
between November 1 and December 31 of each year as occurring on the first
day of the following tax year. Consequently, $3,437,000 of realized losses
reflected in the accompanying financial statements will not be recognized
for tax purposes until 2004.
The fund intends to retain realized gains to the extent of available
capital loss carryforwards for federal income tax purposes. As of December
31, 2003, the fund had $485,133,000 of capital loss carryforwards that
expire in 2009, $433,036,000 that expire in 2010, and $243,293,000 that
expire in 2011.
For the year ended December 31, 2003, the fund recorded the following
permanent reclassifications to reflect tax character. Reclassifications to
paid-in capital relate primarily to per-share rounding of distributions.
Results of operations and net assets were not affected by these
reclassifications.
- --------------------------------------------------------------------------------
Unrealized net investment income $ 1,765,000
Unrealized net realized gain 268,000
Paid-in capital (2,033,000)
At December 31, 2003, the cost of investments for federal income tax
purposes was $5,508,830,000.
NOTE 4 - RELATED PARTY TRANSACTIONS
The fund is managed by T. Rowe Price Associates, Inc. (the manager or Price
Associates), a wholly owned subsidiary of T. Rowe Price Group, Inc. The
investment management agreement between the fund and the manager provides
for an annual investment management fee, which is computed daily and paid
monthly. The fee consists of an individual fund fee, equal to 0.30% of the
fund's average daily net assets, and the fund's pro-rata share of a group
fee. The group fee is calculated based on the combined net assets of
certain mutual funds sponsored by Price Associates (the group) applied to a
graduated fee schedule, with rates ranging from 0.48% for the first $1
billion of assets to 0.295% for assets in excess of $120 billion. The
fund's portion of the group fee is determined by the ratio of its average
daily net assets to those of the group. At December 31, 2003, the effective
annual group fee rate was 0.32%, and investment management fee payable
totaled $3,615,000.
The Advisor Class and R Class are also subject to a contractual expense
limitation through the limitation dates indicated in the table below.
During the limitation period, the manager is required to waive its
management fee and reimburse a class for any expenses, excluding interest,
taxes, brokerage commissions, and extraordinary expenses, that would
otherwise cause the class's ratio of total expenses to average net assets
(expense ratio) to exceed its expense limitation. Through the repayment
date, each class is required to repay the manager for expenses previously
reimbursed and management fees waived to the extent the class's net assets
have grown or expenses have declined sufficiently to allow repayment
without causing the class's expense ratio to exceed its expense limitation.
- --------------------------------------------------------------------------------
Advisor Class R Class
Expense Limitation 1.05% 1.35%
Limitation Date December 31, 2003 April 30, 2004
Repayment Date December 31, 2005 April 30, 2006
At December 31, 2003, expenses previously reimbursed by the manager remain
subject to repayment in the amount of $1,000 through April 30, 2006 for the
R Class. For the year ended December 31, 2003, the Advisor Class operated
below its expense limitation.
In addition, the fund has entered into service agreements with Price
Associates and two wholly owned subsidiaries of Price Associates
(collectively, Price). Price Associates computes the daily share prices and
maintains the financial records of the fund. T. Rowe Price Services, Inc.,
provides shareholder and administrative services in its capacity as the
fund's transfer and dividend disbursing agent. T. Rowe Price Retirement
Plan Services, Inc., provides subaccounting and recordkeeping services for
certain retirement accounts invested in the Blue Chip Growth class, Advisor
Class and R Class. Expenses incurred pursuant to these service agreements
totaled $11,871,000 for the year ended December 31, 2003, of which
$1,117,000 was payable at period-end.
Additionally, the fund is one of several mutual funds in which certain
college savings plans managed by Price Associates may invest. As approved
by the fund's Board of Directors, shareholder servicing costs associated
with each college savings plan are borne by the fund in proportion to the
average daily value of its shares owned by the college savings plan. For
the year ended December 31, 2003, the fund was charged $425,000 for
shareholder servicing costs related to the college savings plans, of which
$315,000 was for services provided by Price and $52,000 was payable at
period-end. At December 31, 2003, approximately 2.4% of the outstanding
shares of the Blue Chip Growth class were held by college savings plans.
The fund is also one of several mutual funds sponsored by Price Associates
(underlying Price funds) in which the T. Rowe Price Spectrum Funds
(Spectrum Funds) may invest. The Spectrum Funds do not invest in the
underlying Price funds for the purpose of exercising management or control.
Pursuant to a special servicing agreement, expenses associated with the
operation of the Spectrum Funds are borne by each underlying Price fund to
the extent of estimated savings to it and in proportion to the average
daily value of its shares owned by the Spectrum Funds. Expenses allocated
under this agreement are reflected as shareholder servicing expense in the
accompanying financial statements. For the year ended December 31, 2003,
the fund was allocated $494,000 of Spectrum Funds' expenses, of which
$354,000 related to services provided by Price and $42,000 was payable at
period-end. At December 31, 2003, approximately 4.2% of the outstanding
shares of the Blue Chip Growth class were held by the Spectrum Funds.
The fund may invest in the T. Rowe Price Reserve Investment Fund and the
T. Rowe Price Government Reserve Investment Fund (collectively, the Reserve
Funds), open-end management investment companies managed by Price
Associates. The Reserve Funds are offered as cash management options only
to mutual funds, trusts, and other accounts managed by Price Associates
and/or its affiliates, and are not available to the public. The Reserve
Funds pay no investment management fees. During the year ended December 31,
2003, dividend income from the Reserve Funds totaled $184,000.
NOTE 5 - INTERFUND BORROWING
Pursuant to its prospectus, the fund may borrow up to 33 1/3% of its total
assets. The fund is party to an interfund borrowing agreement between
itself and other T. Rowe Price-sponsored mutual funds, which permits it to
borrow or lend cash at rates beneficial to both the borrowing and lending
funds. Loans totaling 10% or more of a borrowing fund's total assets are
collateralized at 102% of the value of the loan; loans of less than 10% are
unsecured. During the year ended December 31, 2003, the fund had
outstanding borrowings on seven days, in the average amount of $11,343,000,
and at an average annual rate of 1.51%. At December 31, 2003, the fund had
outstanding borrowings of $12,200,000, at an annual rate of 1.30%.
T. Rowe Price Blue Chip Growth Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Report of Independent Auditors
- --------------------------------------------------------------------------------
To the Board of Directors and Shareholders of
T. Rowe Price Blue Chip Growth Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities,
including the portfolio of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of T.
Rowe Price Blue Chip Growth Fund, Inc. (the "Fund") at December 31,
2003, and the results of its operations, the changes in its net assets
and the financial highlights for each of the fiscal periods presented,
in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with
auditing standards generally accepted in the United States of America,
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made
by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at December 31, 2003 by correspondence with custodians,
provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Baltimore, Maryland
January 26, 2004
T. Rowe Price Blue Chip Growth Fund
- --------------------------------------------------------------------------------
Certified Annual Report
Tax Information (Unaudited) for the Tax Year Ended 12/31/03
- --------------------------------------------------------------------------------
We are providing this information as required by the Internal Revenue Code.
The amounts shown may differ from those elsewhere in this report because of
differences between tax and financial reporting requirements.
For taxable non-corporate shareholders, $7,491,000 of the fund's income and
short-term capital gains represents qualified dividend income subject to
the 15% rate category.
For corporate shareholders, $7,491,000 of the fund's income and short-term
capital gains qualified for the dividends-received deduction.
Information on Proxy Voting
- --------------------------------------------------------------------------------
A description of the policies and procedures that the T. Rowe Price Blue
Chip Growth Fund uses to determine how to vote proxies relating to
portfolio securities is available, without charge, upon request by calling
1-800-225-5132. It also appears in the fund's Statement of Additional
Information (Form 485B), which can be found on the SEC's Web site,
www.sec.gov.
T. Rowe Price Blue Chip Growth Fund
- --------------------------------------------------------------------------------
Certified Annual Report
About the Fund's Directors and Officers
- --------------------------------------------------------------------------------
Your fund is governed by a Board of Directors that meets regularly to review
investments, performance, expenses, and other business matters, and is
responsible for protecting the interests of shareholders. The majority of the
fund's directors are independent of T. Rowe Price Associates, Inc. (T. Rowe
Price); "inside" directors are officers of T. Rowe Price. The Board of Directors
elects the fund's officers, who are listed in the final table. The business
address of each director and officer is 100 East Pratt Street, Baltimore, MD
21202. The Statement of Additional Information includes additional information
about the fund directors and is available without charge by calling a T. Rowe
Price representative at 1-800-225-5132.
Independent Directors
Name
(Date of Birth) Principal Occupation(s) During Past 5 Years
Year Elected* and Directorships of Other Public Companies
Anthony W. Deering Director, Chairman of the Board, President, and
(1/28/45) Chief Executive Officer, The Rouse Company,
2001 real estate developers; Director, Mercantile
Bank (4/03 to present)
Donald W. Dick, Jr. Principal, EuroCapital Advisors, LLC, an
(1/27/43) acquisition and management advisory firm
1993
David K. Fagin Director, Golden Star Resources Ltd., Canyon
(4/9/38) Resources Corp. (5/00 to present), and Pacific Rim
1993 Mining Corp. (2/02 to present); Chairman and
President, Nye Corp.
Karen N. Horn Managing Director and President, Global Private
(9/21/43) Client Services, Marsh Inc.; Managing Director
2003 and Head of International Private Banking,
Bankers Trust; Director, Eli Lilly and Company
F. Pierce Linaweaver President, F. Pierce Linaweaver & Associates,
(8/22/34) Inc., consulting environmental and civil engineers
2001
John G. Schreiber Owner/President, Centaur Capital Partners, Inc., a
(10/21/46) real estate investment company; Senior Advisor
2001 and Partner, Blackstone Real Estate Advisors,
L.P.; Director, AMLI Residential Properties Trust,
Host Marriott Corp., and The Rouse Company
Hubert D. Vos** Owner/President, Stonington Capital Corp.,
(8/2/33) a private investment company
1993
Paul M. Wythes** Founding Partner, Sutter Hill Ventures, a
(6/23/33) venture capital limited partnership, providing
1993 equity capital to young high-technology companies
throughout the United States; Director, Teltone
Corp.
* Each independent director oversees 107 T. Rowe Price portfolios and serves
until retirement, resignation, or election of a successor.
** Retired from Board of Directors effective December 31, 2003.
Inside Directors
Name
(Date of Birth)
Year Elected*
[Number of T. Rowe Price Principal Occupation(s) During Past 5 Years
Portfolios Overseen] and Directorships of Other Public Companies
James A.C. Kennedy, CFA Director and Vice President, T. Rowe Price
(8/15/53) and T. Rowe Price Group, Inc.
1997
[39]
James S. Riepe Director and Vice President, T. Rowe Price; Vice
(6/25/43) Chairman of the Board, Director, and Vice
1993 President, T. Rowe Price Group, Inc.; Chairman
[107] of the Board and Director, T. Rowe Price Global
Asset Management Limited, T. Rowe Price Global
Investment Services Limited, T. Rowe Price
Investment Services, Inc., T. Rowe Price
Retirement Plan Services, Inc., and T. Rowe Price
Services, Inc.; Chairman of the Board, Director,
President, and Trust Officer, T. Rowe Price Trust
Company; Director, T. Rowe Price International,
Inc.; Chairman of the Board, Blue Chip Growth Fund
M. David Testa, CFA, CIC Chief Investment Officer, Director, and Vice
(4/22/44) President, T. Rowe Price; Vice Chairman of
1993 the Board, Chief Investment Officer, Director,
[107] and Vice President, T. Rowe Price Group, Inc.;
Chairman of the Board and Director, T. Rowe Price
International, Inc.; Director, T. Rowe Price
Global Asset Management Limited and T. Rowe Price
Global Investment Services Limited; Director and
Vice President, T. Rowe Price Trust Company
* Each inside director serves until retirement, resignation, or election of a
successor.
Officers
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Jeffrey A. Arricale, CPA (4/11/71) Vice President, T. Rowe Price; formerly
Vice President, Blue Chip Growth Fund Manager, Assurance, KPMG LLP (to 1999);
student, The Wharton School, University
of Pennsylvania (to 2001)
Stephen V. Booth (6/21/61) Vice President, T. Rowe Price, T. Rowe
Vice President, Blue Chip Growth Fund Price Group, Inc., and T. Rowe Price
Trust Company
Joseph A. Carrier (12/30/60) Vice President, T. Rowe Price, T. Rowe
Treasurer, Blue Chip Growth Fund Price Group, Inc., and T. Rowe Price
Investment Services, Inc.
Unless otherwise noted, officers have been employees of T. Rowe Price or T. Rowe
Price International for at least five years.
Officers (continued)
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Donald J. Easley, CFA (11/28/71) Vice President, T. Rowe Price
Vice President, Blue Chip Growth Fund and T. Rowe Price Group, Inc.
Henry M. Ellenbogen (1/21/71) Vice President, T. Rowe Price; formerly
Vice President, Blue Chip Growth Fund Chief of Staff, U.S. Representative
Peter Deutsch (to 1999); Executive Vice
President, Business Development,
HelloAsia (to 2001)
Roger L. Fiery III, CPA (2/10/59) Vice President, T. Rowe Price, T. Rowe
Vice President, Blue Chip Growth Fund Price Group, Inc., T. Rowe Price
International, Inc., and T. Rowe Price
Trust Company
Robert N. Gensler (10/18/57) Vice President, T. Rowe Price and
Vice President, Blue Chip Growth Fund T. Rowe Price Group, Inc.
Henry H. Hopkins (12/23/42) Director and Vice President, T. Rowe
Vice President, Blue Chip Growth Fund Price Group, Inc., T. Rowe Price
Investment Services, Inc., T. Rowe Price
Services, Inc., and T. Rowe Price Trust
Company; Vice President, T. Rowe Price,
T. Rowe Price International, Inc., and
T. Rowe Price Retirement Plan Services,
Inc.
Thomas J. Huber, CFA (9/23/66) Vice President, T. Rowe Price and
Vice President, Blue Chip Growth Fund T. Rowe Price Group, Inc.
Kris H. Jenner, MD, D. Phil. (2/5/62) Vice President, T. Rowe Price and
Vice President, Blue Chip Growth Fund T. Rowe Price Group, Inc.
Christopher R. Leonard, CFA (1/11/73) Vice President, T. Rowe Price and
Vice President, Blue Chip Growth Fund T. Rowe Price Group, Inc.
Patricia B. Lippert (1/12/53) Assistant Vice President, T. Rowe Price
Secretary, Blue Chip Growth Fund and T. Rowe Price Investment Services,
Inc.
Timothy E. Parker (11/9/74) Vice President, T. Rowe Price; formerly
Vice President, Blue Chip Growth Fund Financial Analyst, Robert W. Baird &
Co., Inc. (to 1999); student, Darden
Graduate School, University of Virginia
(to 2001)
Larry J. Puglia, CFA, CPA (8/25/60) Vice President, T. Rowe Price
President, Blue Chip Growth Fund and T. Rowe Price Group, Inc.
Karen M. Regan (4/16/67) Assistant Vice President, T. Rowe Price
Vice President, Blue Chip Growth Fund
Jeffrey Rottinghaus, CPA (2/20/70) Vice President, T. Rowe Price;
Vice President, Blue Chip Growth Fund formerly Information Technology
Consultant, Kelly-Lewey & Associates
(to 1999); student, The Wharton School,
University of Pennsylvania (to 2001)
Unless otherwise noted, officers have been employees of T. Rowe Price or T. Rowe
Price International for at least five years.
Officers (continued)
Name (Date of Birth)
Title and Fund(s) Served Principal Occupation(s)
Robert W. Sharps, CFA (6/10/71) Vice President, T. Rowe Price and
Vice President, Blue Chip Growth Fund T. Rowe Price Group, Inc.
Robert W. Smith (4/11/61) Vice President, T. Rowe Price, T. Rowe
Vice President, Blue Chip Growth Fund Price Group, Inc., and T. Rowe Price
International, Inc.
Julie L. Waples (5/12/70) Vice President, T. Rowe Price
Vice President, Blue Chip Growth Fund
Unless otherwise noted, officers have been employees of T. Rowe Price or T. Rowe
Price International for at least five years.
Item 2. Code of Ethics.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions. A copy of this code of
ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were
approved or waivers were granted to this code of ethics during the period
covered by this report.
Item 3. Audit Committee Financial Expert.
The registrant's Board of Directors/Trustees has determined that Mr. David K.
Fagin qualifies as an audit committee financial expert, as defined in Item 3 of
Form N-CSR. Mr. Fagin is considered independent for purposes of Item 3 of Form
N-CSR.
Item 4. Principal Accountant Fees and Services.
(a) - (d) Aggregate fees billed to the registrant for the last two fiscal years
for professional services rendered by the registrant's principal accountant were
as follows:
2003 2002
Audit Fees $25,034 $18,116
Audit-Related Fees 1,499 --
Tax Fees 6,502 4,386
All Other Fees 124 315
Audit fees include amounts related to the audit of the registrant's annual
financial statements and services normally provided by the accountant in
connection with statutory and regulatory filings. Audit-related fees include
amounts reasonably related to the performance of the audit of the registrant's
financial statements, specifically the issuance of a report on internal
controls. Tax fees include amounts related to tax compliance, tax planning, and
tax advice. Other fees include the registrant's pro-rata share of amounts for
agreed-upon procedures in conjunction with service contract approvals by the
registrant's Board of Directors/Trustees.
(e)(1) The registrant's audit committee has adopted a policy whereby audit and
non-audit services performed by the registrant's principal accountant for the
registrant, its investment adviser, and any entity controlling, controlled by,
or under common control with the investment adviser that provides ongoing
services to the registrant require pre-approval in advance at regularly
scheduled audit committee meetings. If such a service is required between
regularly scheduled audit committee meetings, pre-approval may be authorized by
one audit committee member with ratification at the next scheduled audit
committee meeting. Waiver of pre-approval for audit or non-audit services
requiring fees of a de minimis amount is not permitted.
(2) No services included in (b) - (d) above were approved pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed for the most recent fiscal year and the preceding
fiscal year by the registrant's principal accountant for non-audit services
rendered to the registrant, its investment adviser, and any entity controlling,
controlled by, or under common control with the investment adviser that provides
ongoing services to the registrant were $719,000 and $671,000, respectively, and
were less than the aggregate fees billed for those same periods by the
registrant's principal accountant for audit services rendered to the T. Rowe
Price Funds.
(h) All non-audit services rendered in (g) above were pre-approved by the
registrant's audit committee. Accordingly, these services were considered by the
registrant's audit committee in maintaining the principal accountant's
independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 9. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial officer
have evaluated the registrant's disclosure controls and procedures within 90
days of this filing and have concluded that the registrant's disclosure controls
and procedures were effective, as of that date, in ensuring that information
required to be disclosed by the registrant in this Form N-CSR was recorded,
processed, summarized, and reported timely.
(b) The registrant's principal executive officer and principal financial officer
are aware of no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 10. Exhibits.
(a)(1) The registrant's code of ethics pursuant to Item 2 of Form N-CSR is
attached.
(a)(2) Separate certifications by the registrant's principal executive officer
and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of
1940, are attached.
(b) A certification by the registrant's principal executive officer and
principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940,
is attached.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price Blue Chip Growth Fund, Inc.
By /s/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date February 13, 2004
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/ James S. Riepe
James S. Riepe
Principal Executive Officer
Date February 13, 2004
By /s/ Joseph A. Carrier
Joseph A. Carrier
Principal Financial Officer
Date February 13, 2004