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: 811-00204
AllianceBernstein Mid-Cap Growth Fund, Inc.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Mark R. Manley
Alliance Capital Management, L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: July 31, 2003
Date of reporting period: January 31, 2004
ITEM 1. REPORTS TO STOCKHOLDERS.
[LOGO] ALLIANCEBERNSTEIN (SM)
Investment Research and Management
AllianceBernstein Mid-Cap Growth Fund
Mid-Cap Blend
Semi-Annual Report--January 31, 2004
Investment Products Offered
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that shares, when redeemed, may be worth more or less than their
original cost. You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. For a free copy of the
Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest.
You may obtain month-end performance information from our web site at
www.alliancebernstein.com (click on Investors/ Products & Services/ Mutual
Funds).
This shareholder report must be preceded or accompanied by the Fund's
prospectus for individuals who are not current shareholders of the Fund.
You may obtain a description of the Fund's proxy voting policies and
procedures, without charge, upon request by visiting Alliance Capital's web
site at www.alliancebernstein.com (click on Investors, then the "proxy voting
policies and procedures" link on the left side of the page), or by going to the
Securities and Exchange Commission's web site at www.sec.gov, or by calling
Alliance Capital at (800) 227-4618.
AllianceBernstein Investment Research and Management, Inc. is an affiliate of
Alliance Capital Management L.P., the manager of the funds, and is a member of
the NASD.
March 4, 2004
Semi-Annual Report
This report provides management's discussion of fund performance for
AllianceBernstein Mid-Cap Growth Fund (the "Fund") for the semi-annual
reporting period ended January 31, 2004.
Investment Objective and Policies
AllianceBernstein Mid-Cap Growth Fund is an open-end, diversified investment
company that seeks long-term growth of capital and income primarily through
investments in common stocks that Alliance Capital believes will appreciate in
value. The Fund invests predominantly in the stocks of mid-capitalization
companies.
Investment Results
The following table provides the Fund's investment results for the six- and
12-month periods ended January 31, 2004. For comparison, we have also provided
performance for the Fund's benchmark, the Russell MidCap Growth Index, which is
a measure of mid-cap stock performance.
INVESTMENT RESULTS*
Periods Ended January 31, 2004
Returns
6 Months 12 Months
- -------------------------------------------------------------------------------
AllianceBernstein Mid-Cap Growth Fund
Class A 33.18% 82.77%
Class B 32.56% 81.27%
Class C 32.30% 81.56%
Russell MidCap Growth Index 19.88% 48.89%
* The Fund's investment results are for the periods shown and are based on
the net asset value (NAV) of each class of shares as of January 31, 2004.
Returns do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. All fees and expenses
related to the operation of the Fund have been deducted, but no adjustment has
been made for sales charges that may apply when shares are purchased or
redeemed. Returns for Advisor Class shares will vary due to different expenses
associated with this class. Returns for the Fund include the reinvestment of
any distributions paid during each period. Past performance is no guarantee of
future results.
The unmanaged Russell MidCap Growth Index does not reflect fees and
expenses associated with the active management of a mutual fund portfolio. The
Index measures the performance of those Russell mid-cap companies with higher
price-to-book ratios and higher forecasted growth values. The stocks are also
members of the Russell 1000 Growth Index. Investors cannot invest directly in
an index, and its results are not indicative of any specific investment,
including AllianceBernstein Mid-Cap Growth Fund.
Additional investment results appear on pages 4-6.
For the six- and 12-month periods ended January 31, 2004, the Fund
significantly outperformed its benchmark, the Russell MidCap Growth Index, due
to overweight positions and good stock selection in technology,
telecommunication services and con-
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 1
sumer discretionary stocks. Technology was the largest contributor to
performance with contributions primarily from semiconductor, software and
networking holdings. Underlying demand from the consumer and the enterprise
markets was stronger than expected, spurring better than expected earnings and
sales results during the second half of 2003. After three years of little to no
business investment, the surprises during the early stages of this expansion,
in some cases, have been dramatic. The Fund also benefited meaningfully from
several wireless and internet stocks. Health care as a whole contributed to
performance, with biotechnology stocks contributing the most to the sector.
The Fund's overweight position in the airline industry was the largest drag on
performance. Airlines were hit by higher than expected fuel costs, which they
were unable to pass along to consumers. The Fund's defense holdings performed
poorly on a relative basis as concerns surrounding government spending and the
mounting deficit weighed on the stocks.
Market Review and Investment Strategy
The equity markets rose sharply during the second half of the year as fears
regarding the geopolitical landscape began to subside and corporate governance
issues no longer dominated the headlines. Improving company fundamentals and a
rebounding economy increased investor appetite for stocks. Technology, internet
and telecommunication companies were the prime beneficiaries of the asset
allocation shift that took place. The Fund was well positioned in technology
with broad exposure to semiconductor, software, networking, security and
storage stocks. We focused on companies that were in a position to capitalize
on the broadband revolution now underway. We held a number of internet stocks
that broadly played into this theme.
In mid-2003, as energy and defense stocks corrected, we used the proceeds from
our profit-taking in technology stocks to increase the Fund's positions in both
sectors. The wireless service group was one of the more volatile groups during
the period, fueled by uncertainty surrounding the potential impact of wireless
local number portability. We used the volatility as an opportunity to build the
Fund's wireless positions. We decided to underweight financial service stocks,
choosing instead to increase the Fund's cyclical exposure through overweight
positions in technology, industrials and producer durables. The Fund's position
in high beta, early stage biotechnology companies was a good counterweight to
the underweight position in the health care sector.
- -------------------------------------------------------------------------------
2 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
PORTFOLIO SUMMARY
January 31, 2004 (unaudited)
INCEPTION DATES
Class A Shares
7/7/38
Class B Shares
3/4/91
Class C Shares
5/3/93
PORTFOLIO STATISTICS
Net Assets ($mil): $854.3
SECTOR BREAKDOWN
45.2% Technology
17.4% Health Care
11.9% Consumer Services
9.5% Energy
3.7% Finance [PIE CHART OMITTED]
3.4% Consumer Manufacturing
3.4% Capital Goods
2.4% Aerospace & Defense
1.4% Basic Industry
0.8% Consumer Staples
0.9% Short-Term
All data as of January 31, 2004. The Fund's sector breakdown is expressed as a
percentage of total investments (excluding security lending collateral) and may
vary over time.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 3
INVESTMENT RESULTS
CLASS A SHARE AVERAGE ANNUAL RETURNS AS OF JANUARY 31, 2004
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 82.77% 75.22%
5 Years 1.64% 0.76%
10 Years 8.19% 7.72%
CLASS A SHARE SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (DECEMBER 31, 2003)
- -------------------------------------------------------------------------------
1 Year 58.72%
5 Years -0.28%
10 Years 7.27%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. The Fund's investment results are for the periods shown and
are based on the Fund's Class A shares at net asset value (NAV). All fees and
expenses related to the operation of the Fund have been deducted. NAV returns
do not reflect sales charges; if sales charges were reflected, the Fund's
quoted performance would be lower. Fund returns do not reflect the deduction of
taxes that a shareholder would pay on fund distributions or the redemption of
fund shares. Fund returns reflect the reinvestment of dividends and/or capital
gains distributions in additional shares.
SEC returns reflect the 4.25% maximum front-end sales charge for Class A shares.
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that shares, when redeemed, may be worth more or less than their
original cost. You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. For a free copy of the
Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest. You may
obtain current month-end performance information from our web site at
www.alliancebernstein.com (click on Investors/Products & Services/Mutual Funds).
A Word About Risk: The Fund can invest in foreign securities. Foreign markets
can be more volatile than the U.S. market due to increased risks of adverse
issuer, political, regulatory, market or economic developments. In addition,
fluctuations in the value of investments in foreign currency denominated
securities may be magnified by changes in foreign exchange rates. While the
Fund invests principally in common stocks and other equity securities, in order
to achieve its investment objectives, the Fund may at times use certain types
of investment derivatives, such as options, futures, forwards and swaps. These
instruments involve risks different from, and in certain cases, greater than
the risks presented by more traditional investments. These risks are more fully
discussed in the prospectus. Many equity stocks, and smaller capitalization
stocks in particular, have experienced significant gains over the past year.
There is no assurance that the gains will continue.
- -------------------------------------------------------------------------------
4 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
INVESTMENT RESULTS
CLASS B SHARE AVERAGE ANNUAL RETURNS AS OF JANUARY 31, 2004
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 81.27% 77.27%
5 Years 0.77% 0.77%
10 Years(a) 7.49% 7.49%
CLASS B SHARE SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (DECEMBER 31, 2003)
- -------------------------------------------------------------------------------
1 Year 60.46%
5 Years -0.30%
10 Years(a) 7.02%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. The Fund's investment results are for the periods shown and
are based on the Fund's Class B shares at net asset value (NAV). All fees and
expenses related to the operation of the Fund have been deducted. NAV returns
do not reflect sales charges; if sales charges were reflected, the Fund's
quoted performance would be lower. Fund returns do not reflect the deduction of
taxes that a shareholder would pay on fund distributions or the redemption of
fund shares. Fund returns reflect the reinvestment of dividends and/or capital
gains distributions in additional shares.
SEC returns reflect the applicable contingent deferred sales charge for Class B
shares (4% year 1, 3% year 2, 2% year 3, 1% year 4).
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that shares, when redeemed, may be worth more or less than their
original cost. You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. For a free copy of the
Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest. You may
obtain current month-end performance information from our web site at
www.alliancebernstein.com (click on Investors/Products & Services/Mutual Funds).
A Word About Risk: The Fund can invest in foreign securities. Foreign markets
can be more volatile than the U.S. market due to increased risks of adverse
issuer, political, regulatory, market or economic developments. In addition,
fluctuations in the value of investments in foreign currency denominated
securities may be magnified by changes in foreign exchange rates. While the
Fund invests principally in common stocks and other equity securities, in order
to achieve its investment objectives, the Fund may at times use certain types
of investment derivatives, such as options, futures, forwards and swaps. These
instruments involve risks different from, and in certain cases, greater than
the risks presented by more traditional investments. These risks are more fully
discussed in the prospectus. Many equity stocks, and smaller capitalization
stocks in particular, have experienced significant gains over the past year.
There is no assurance that the gains will continue.
(a) Assumes conversion of Class B shares into Class A shares after eight years.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 5
INVESTMENT RESULTS
CLASS C SHARE AVERAGE ANNUAL RETURNS AS OF JANUARY 31, 2004
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 81.56% 80.56%
5 Years 0.77% 0.77%
10 Years 7.23% 7.23%
CLASS C SHARE SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT QUARTER-END (DECEMBER 31, 2003)
- -------------------------------------------------------------------------------
1 Year 63.69%
5 Years -0.30%
10 Years 6.77%
The performance shown above represents past performance and does not guarantee
future results. Current performance may be lower or higher than the performance
information shown. The Fund's investment results are for the periods shown and
are based on the Fund's Class C shares at net asset value (NAV). All fees and
expenses related to the operation of the Fund have been deducted. NAV returns
do not reflect sales charges; if sales charges were reflected, the Fund's
quoted performance would be lower. Fund returns do not reflect the deduction of
taxes that a shareholder would pay on fund distributions or the redemption of
fund shares. Fund returns reflect the reinvestment of dividends and/or capital
gains distributions in additional shares.
SEC returns reflect the applicable contingent deferred sales charge for Class C
shares (1% year 1).
The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that shares, when redeemed, may be worth more or less than their
original cost. You should consider the investment objectives, risks, charges
and expenses of the Fund carefully before investing. For a free copy of the
Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or Alliance at
(800) 227-4618. Please read the prospectus carefully before you invest. You may
obtain current month-end performance information from our web site at
www.alliancebernstein.com (click on Investors/Products & Services/Mutual Funds).
A Word About Risk: The Fund can invest in foreign securities. Foreign markets
can be more volatile than the U.S. market due to increased risks of adverse
issuer, political, regulatory, market or economic developments. In addition,
fluctuations in the value of investments in foreign currency denominated
securities may be magnified by changes in foreign exchange rates. While the
Fund invests principally in common stocks and other equity securities, in order
to achieve its investment objectives, the Fund may at times use certain types
of investment derivatives, such as options, futures, forwards and swaps. These
instruments involve risks different from, and in certain cases, greater than
the risks presented by more traditional investments. These risks are more fully
discussed in the prospectus. Many equity stocks, and smaller capitalization
stocks in particular, have experienced significant gains over the past year.
There is no assurance that the gains will continue.
- -------------------------------------------------------------------------------
6 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
TEN LARGEST HOLDINGS
January 31, 2004 (unaudited)
Percent of
Company U.S. $ Value Net Assets
- -------------------------------------------------------------------------------
Sprint Corp. (PCS Group) $ 40,158,460 4.7%
PeopleSoft, Inc. 33,355,521 3.9
Juniper Networks, Inc. 30,264,875 3.5
Micron Technology, Inc. 28,465,645 3.3
Applera Corp.-Applied Biosystems
Group 26,267,232 3.1
Network Appliance, Inc. 25,698,907 3.0
BJ Services Co. 24,099,281 2.8
NVIDIA Corp. 22,316,194 2.6
NetScreen Technologies, Inc. 21,143,226 2.5
Intuit, Inc. 20,933,275 2.5
------------ ----
$272,702,616 31.9%
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN Mid-Cap GROWTH FUND o 7
PORTFOLIO OF INVESTMENTS
January 31, 2004 (unaudited)
Company Shares Value
- -------------------------------------------------------------------------------
COMMON STOCKS-100.0%
Technology-45.6%
Communication Equipment-8.0%
3Com Corp.(a) 1,069,480 $ 8,234,996
Corning, Inc.(a) 1,391,290 17,975,467
JDS Uniphase Corp.(a) 2,327,940 11,872,494
Juniper Networks, Inc.(a) 1,047,590 30,264,875
------------
68,347,832
------------
Communication Services-1.1%
Level 3 Communications, Inc.(a) 1,563,440 9,380,640
------------
Computer Hardware/Storage-0.8%
Seagate Technology (Cayman Islands) 404,220 6,588,786
------------
Computer Peripherals-3.0%
Network Appliance, Inc.(a) 1,149,325 25,698,907
------------
Computer Software-13.1%
BEA Systems, Inc.(a) 1,347,305 17,016,462
Electronic Arts, Inc.(a) 186,722 8,749,793
Intuit, Inc.(a) 415,178 20,933,275
NetScreen Technologies, Inc.(a) 809,465 21,143,226
PeopleSoft, Inc.(a) 1,547,820 33,355,521
Red Hat, Inc.(a) 562,460 10,703,614
------------
111,901,891
------------
Internet Infrastructure-0.9%
eBay, Inc.(a) 115,454 7,738,881
------------
Internet Media-4.9%
CNET Networks, Inc.(a) 1,593,980 17,119,345
RealNetworks, Inc.(a) 1,340,500 7,466,585
SINA Corp. (Hong Kong)(a) 113,000 5,162,631
Yahoo, Inc.(a) 260,246 12,192,525
------------
41,941,086
------------
Semi-Conductor Capital Equipment-2.3%
KLA-Tencor Corp.(a) 341,940 19,514,516
------------
Semi-Conductor Components-11.5%
Broadcom Corp. Cl.A(a) 404,570 16,421,496
Marvell Technology Group, Ltd. (Bermuda)(a) 259,790 10,807,264
Micron Technology, Inc.(a) 1,766,955 28,465,645
NVIDIA Corp.(a) 1,002,975 22,316,194
Silicon Laboratories, Inc.(a) 405,380 20,783,833
------------
98,794,432
------------
389,906,971
------------
- -------------------------------------------------------------------------------
8 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Company Shares Value
- -------------------------------------------------------------------------------
Health Care-17.5%
Biotechnology-14.1%
Affymetrix, Inc.(a) 638,295 $ 20,010,548
Applera Corp.-Applied Biosystems Group 1,111,135 26,267,232
Applera Corp.-Celera Genomics Group(a) 893,050 13,592,221
Biogen Idec, Inc.(a) 406,580 17,397,558
Compugen, Ltd. (Israel)(a) 1,435,500 10,436,085
Gilead Sciences, Inc.(a) 304,170 16,689,808
Millennium Pharmaceuticals, Inc.(a) 925,430 16,324,585
------------
120,718,037
------------
Medical Products-2.0%
Cerus Corp.(a) 1,785,798 7,696,789
Zimmer Holdings, Inc.(a) 121,350 9,283,275
------------
16,980,064
------------
Medical Services-1.4%
Cepheid, Inc.(a) 1,195,000 12,284,600
------------
149,982,701
------------
Consumer Services-12.0%
Airlines-1.1%
Southwest Airlines Co. 614,250 9,183,038
------------
Broadcasting & Cable-1.5%
XM Satellite Radio Holdings, Inc. Cl.A(a) 553,585 13,064,606
------------
Cellular Communications-4.7%
Sprint Corp. (PCS Group)(a) 4,939,540 40,158,460
------------
Gaming-1.0%
Wynn Resorts, Ltd.(a) 304,640 8,968,602
------------
Restaurants & Lodging-0.8%
Starbucks Corp.(a) 178,315 6,554,859
------------
Retail - General Merchandise-2.9%
Amazon.com, Inc.(a) 205,130 10,354,962
Tiffany & Co. 354,070 14,035,335
------------
24,390,297
------------
102,319,862
------------
Energy-9.7%
Domestic Producers-3.0%
Apache Corp. 375,660 14,455,396
Noble Energy, Inc. 244,390 10,802,038
------------
25,257,434
------------
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 9
Shares or
Principal
Amount
Company (000) Value
- -------------------------------------------------------------------------------
Oil Service-4.0%
BJ Services Co.(a) 615,720 $ 24,099,281
FMC Technologies, Inc.(a) 408,910 10,063,275
Nabors Industries, Ltd. (Barbados)(a) 7,100 312,400
------------
34,474,956
------------
Miscellaneous-2.7%
Evergreen Resources, Inc.(a) 251,270 8,126,072
Valero Energy Corp. 279,625 14,797,755
------------
22,923,827
------------
82,656,217
------------
Finance-3.8%
Brokerage & Money Management-2.2%
Ameritrade Holding Corp. Cl.A(a) 626,900 9,936,365
Legg Mason, Inc. 103,475 9,162,711
------------
19,099,076
------------
Miscellaneous-1.6%
Providian Financial Corp.(a) 967,660 13,247,266
------------
32,346,342
------------
Consumer Manufacturing-3.4%
Building & Related-3.4%
D.R. Horton, Inc. 617,378 17,348,308
Lennar Corp. Cl.A 264,230 11,652,543
------------
29,000,851
------------
Capital Goods-3.4%
Electrical Equipment-3.4%
Alliant Techsystems, Inc.(a) 312,770 17,515,120
The Shaw Group, Inc.(a) 978,150 11,424,792
------------
28,939,912
------------
Aerospace & Defense-2.4%
Aerospace-2.4%
Northrop Grumman Corp. 209,750 20,284,922
------------
Basic Industry-1.4%
Paper & Forest Products-1.4%
Smurfit-Stone Container Corp.(a) 679,040 11,706,650
------------
Consumer Staples-0.8%
Retail-Food & Drug-0.8%
Whole Foods Market, Inc. 106,020 7,153,169
------------
Total Common Stocks
(cost $590,517,639) 854,297,597
------------
SHORT-TERM INVESTMENT-1.0%
Time Deposit-1.0%
State Street Euro Dollar
0.50%, 2/02/04
(cost $8,197,000) $8,197 8,197,000
------------
- -------------------------------------------------------------------------------
10 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Company Shares Value
- -------------------------------------------------------------------------------
Total Investments Before Security Lending
Collateral-101.0%
(cost $598,714,639) $862,494,597
------------
INVESTMENT OF CASH COLLATERAL FOR SECURITIES
LOANED*-11.5%
Short-Term Investment-11.5%
UBS Private Money Market Fund, LLC, 1.02%
(cost $98,550,100) 98,550,100 98,550,100
------------
Total Investments-112.5%
(cost $697,264,739) 961,044,697
Other assets less liabilities-(12.5%) (106,732,235)
------------
Net Assets-100.0% $854,312,462
============
* See Note E for securities lending information.
(a) Non-income producing security.
See notes to financial statements.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 11
STATEMENT OF ASSETS & LIABILITIES
January 31, 2004 (unaudited)
Assets
Investments in securities, at value
(cost $697,264,739--including investment of
cash collateral for securities loaned of $98,550,100) $ 961,044,697(a)
Cash 489
Receivable for investment securities sold 14,939,120
Receivable for capital stock sold 1,373,060
Dividends and interest receivable 75,201
--------------
Total assets 977,432,567
--------------
Liabilities
Payable for collateral on securities loaned 98,550,100
Payable for investment securities purchased 22,972,215
Management fee payable 586,471
Payable for capital stock redeemed 528,459
Distribution fee payable 153,267
Accrued expenses and other liabilities 329,593
--------------
Total liabilities 123,120,105
--------------
Net Assets $ 854,312,462
==============
Composition of Net Assets
Capital stock, at par $ 1,467,279
Additional paid-in capital 789,230,489
Accumulated net investment loss (4,137,561)
Accumulated net realized loss on investment transactions (196,027,703)
Net unrealized appreciation of investments 263,779,958
--------------
$ 854,312,462
==============
Calculation of Maximum Offering Price
Class A Shares
Net asset value and redemption price per share
($703,063,186/118,351,471 shares of capital stock
issued and outstanding) $5.94
Sales charge--4.25% of public offering price .26
-----
Maximum offering price $6.20
=====
Class B Shares
Net asset value and offering price per share
($86,050,129/16,762,411) shares of capital stock
issued and outstanding) $5.13
=====
Class C Shares
Net asset value and offering price per share
($26,987,676/5,265,970 shares of capital stock
issued and outstanding) $5.12
=====
Advisor Class Shares
Net asset value, redemption and offering price per share
($38,211,471/6,348,018 shares of capital stock
issued and outstanding) $6.02
=====
(a) Includes securities on loan with a value of $95,560,961 (see Note E).
See notes to financial statements.
- -------------------------------------------------------------------------------
12 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
STATEMENT OF OPERATIONS
Six Months Ended January 31, 2004 (unaudited)
Investment Income
Dividends $ 706,432
Securities lending income 42,712
Interest 18,486 $ 767,630
--------------
Expenses
Management fee 2,653,285
Distribution fee-Class A 678,871
Distribution fee-Class B 347,121
Distribution fee-Class C 101,792
Transfer agency 834,942
Custodian 106,353
Administrative 72,100
Printing 68,175
Audit and legal 55,122
Registration 37,330
Directors' fees 9,919
Miscellaneous 13,190
--------------
Total expenses 4,978,200
Less: expenses waived by the
Transfer Agent (see Note B) (72,908)
Less: expense offset arrangement
(see Note B) (101)
--------------
Net expenses 4,905,191
--------------
Net investment loss (4,137,561)
--------------
Realized and Unrealized Gain on
Investment Transactions
Net realized gain on investment
transactions 106,632,154
Net change in unrealized
appreciation/depreciation
of investments 107,501,027
--------------
Net gain on investment transactions 214,133,181
--------------
Net Increase in Net Assets
from Operations $ 209,995,620
==============
See notes to financial statements.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 13
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended December 1,
January 31, 2002 Year Ended
2004 to November 30,
(unaudited) July 31, 2003* 2002
=========== ============= ============
Increase (Decrease) in
Net Assets from
Operations
Net investment loss $(4,137,561) $(4,146,138) $(7,710,224)
Net realized gain (loss)
on investment
transactions 106,632,154 40,130,756 (186,108,624)
Net change in unrealized
appreciation/
depreciation
of investments 107,501,027 69,827,646 (24,491,326)
------------ ------------ ------------
Net increase (decrease)
in net assets from
operations 209,995,620 105,812,264 (218,310,174)
Capital Stock
Transactions
Net increase (decrease) 14,346,742 (10,459,807) (141,756,741)
------------ ------------ ------------
Total increase
(decrease) 224,342,362 95,352,457 (360,066,915)
Net Assets
Beginning of period 629,970,100 534,617,643 894,684,558
------------ ------------ ------------
End of period $854,312,462 $629,970,100 $534,617,643
============ ============ ============
* The Fund changed its fiscal year end from November 30 to July 31.
See notes to financial statements.
- -------------------------------------------------------------------------------
14 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
NOTES TO FINANCIAL STATEMENTS
January 31, 2004 (unaudited)
NOTE A
Significant Accounting Policies
The AllianceBernstein Mid-Cap Growth Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a diversified, open-end management
investment company. The Fund offers Class A, Class B, Class C and Advisor Class
shares. Class A shares are sold with a front-end sales charge of up to 4.25%
for purchases not exceeding $1,000,000. With respect to purchases of $1,000,000
or more, Class A shares redeemed within one year of purchase may be subject to
a contingent deferred sales charge of 1%. Class B shares are currently sold
with a contingent deferred sales charge which declines from 4% to zero
depending on the period of time the shares are held. Class B shares will
automatically convert to Class A shares eight years after the end of the
calendar month of purchase. Class C shares are subject to a contingent deferred
sales charge of 1% on redemptions made within the first year after purchase.
Advisor Class shares are sold without an initial or contingent deferred sales
charge and are not subject to ongoing distribution expenses. Advisor Class
shares are offered to investors participating in fee-based programs and to
certain retirement plan accounts. All four classes of shares have identical
voting, dividend, liquidation and other rights, except that each class bears
different distribution expenses and has exclusive voting rights with respect to
its distribution plan. The financial statements have been prepared in
conformity with accounting principles generally accepted in the United States
which require management to make certain estimates and assumptions that affect
the reported amounts of assets and liabilities in the financial statements and
amounts of income and expenses during the reporting period. Actual results
could differ from those estimates. Additional information about some of the
items discussed in these Notes to Financial Statements is contained in the
Fund's Statement of Additional Information, which is available upon request.
The following is a summary of significant accounting policies followed by the
Fund.
1. Security Valuation
In accordance with Pricing Policies adopted by the Board of Directors of the
Fund (the "Pricing Policies") and applicable law, portfolio securities are
valued at current market value or at fair value. The Board of Directors has
delegated to Alliance Capital Management, L.P. (the "Manager"), subject to the
Board's continuing oversight, certain responsibilities with respect to the
implementation of the Pricing Policies. Pursuant to the Pricing Policies,
securities for which market quotations are readily available are valued at
their current market value. In general, the market value of these securities is
determined as follows:
Securities listed on a national securities exchange or on a foreign securities
exchange are valued at the last sale price at the close of the exchange or
foreign securities exchange. If there has been no sale on such day, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued in good faith at
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 15
fair value in accordance with the Pricing Policies. Securities listed on more
than one exchange are valued by reference to the principal exchange on which
the securities are traded; securities not listed on an exchange but traded on
The Nasdaq Stock Market, Inc. ("NASDAQ") are valued in accordance with the
NASDAQ Official Closing Price; listed put or call options are valued at the
last sale price. If there has been no sale on that day, such securities will be
valued at the closing bid prices on that day; open futures contracts and
options thereon are valued using the closing settlement price or, in the
absence of such a price, the most recent quoted bid price. If there are no
quotations available for the day of valuations, the last available closing
settlement price is used; securities traded in the over-the-counter market,
(but excluding securities traded on NASDAQ) are valued at the mean of the
current bid and asked prices as reported by the National Quotation Bureau or
other comparable sources; U.S. Government securities and other debt instruments
having 60 days or less remaining until maturity are valued at amortized cost if
their original maturity was 60 days or less, or by amortizing their fair value
as of the 61st day prior to maturity if their original term to maturity
exceeded 60 days; fixed-income securities, including mortgage backed and asset
backed securities, may be valued on the basis of prices provided by a pricing
service or at a price obtained from one or more of the major broker/dealers. In
cases where broker/dealer quotes are obtained, the Pricing Policies provide
that the Adviser may establish procedures whereby changes in market yields or
spreads are used to adjust, on a daily basis, a recently obtained quoted price
on a security; and OTC and other derivatives are valued on the basis of a
quoted bid price or spread from a major broker/dealer in such security.
Securities for which market quotations are not readily available are valued at
fair value in accordance with the Pricing Policies.
2. Currency Translation
Assets and liabilities denominated in foreign currencies and commitments under
forward exchange currency contracts are translated into U.S. dollars at the
mean of the quoted bid and asked prices of such currencies against the U.S.
dollar. Purchases and sales of portfolio securities are translated into U.S.
dollars at the rates of exchange prevailing when such securities were acquired
or sold. Income and expenses are translated into U.S. dollars at rates of
exchange prevailing when accrued.
Net realized gain or loss on foreign currency transactions represents foreign
exchange gains, losses from sales and maturities of foreign fixed income
investments, foreign currency exchange contracts, holding of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on foreign investment transactions, and the difference between the
amounts of dividends, interest and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent amounts actually received or paid.
Net unrealized currency gains and losses from valuing foreign currency
denominated assets and liabilities
- -------------------------------------------------------------------------------
16 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
at period end exchange rates are reflected as a component of net unrealized
appreciation or depreciation of investments and foreign currency denominated
assets and liabilities.
3. Taxes
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
4. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the trade date securities
are purchased or sold. Investment gains and losses are determined on the
identified cost basis. The Fund accretes discounts as adjustments to interest
income.
5. Income and Expenses
All income earned and expenses incurred by the Fund are borne on a pro rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that the Fund's
Class B and Class C shares bear higher distribution and transfer agent fees
than Class A and Advisor Class shares. Advisor Class shares have no
distribution fees.
6. Dividends and Distributions
Dividends and distributions to shareholders, if any, are recorded on the
ex-dividend date. Income dividends and capital gains distributions are
determined in accordance with federal tax regulations and may differ from those
determined in accordance with accounting principles generally accepted in the
United States. To the extent these differences are permanent, such amounts are
reclassified within the capital accounts based on their federal tax basis
treatment; temporary differences, do not require such reclassification.
7. Change of Fiscal Year End
The Fund changed its fiscal year end from November 30 to July 31. Accordingly,
the statement of changes in net assets and financial highlights include the
period from December 1, 2002 to July 31, 2003.
NOTE B
Management Fee and Other Transactions With Affiliates
Under the terms of the management agreement, the Fund pays the Manager a fee at
an annual rate of .75% on the first $500 million of average daily net assets,
..65% on the next $500 million of average daily net assets and .55% on average
daily net assets in excess of $1 billion. Such fee is accrued daily and paid
monthly.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 17
Pursuant to the management agreement, the Fund paid $72,100 to the Manager
representing the cost of certain legal and accounting services provided to the
Fund by the Manager for the six months ended January 31, 2004.
The Fund compensates Alliance Global Investor Services, Inc., (AGIS) a
wholly-owned subsidiary of the Manager, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for the
Fund. Such compensation amounted to $636,147 for the six months ended January
31, 2004. In addition, AGIS agreed to waive a portion of its fees for the six
months ended January 31 2004. Such waiver amounted to $72,908.
For the six months ended January 31, 2004, the Fund's expenses were reduced by
$101, respectively, under an expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc., (the
"Distributor"), a wholly-owned subsidiary of the Manager, serves as the
distributor of the Fund's shares. The Distributor has advised the Fund that it
has retained front-end sales charges of $14,871 from the sale of Class A shares
and received $11,630, $48,466 and $2,147 in contingent deferred sales charges
imposed upon redemptions by shareholders of Class A, Class B and Class C
shares, respectively, for the six months ended January 31, 2004.
Brokerage commissions paid on investment transactions for the six months ended
January 31, 2004 amounted to $1,863,238 of which $22,212 was paid to Sanford C.
Bernstein & Co. LLC, an affiliate of the Manager.
NOTE C
Distribution Services Agreement
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, the Fund pays distribution and servicing fees to the Distributor at
an annual rate of up to .30% of the Fund's average daily net assets
attributable to Class A shares and 1% of the average daily net assets
attributable to both Class B and Class C shares. There are no distribution and
servicing fees on the Advisor Class shares. The fees are accrued daily and paid
monthly. The Agreement provides that the Distributor will use such payments in
their entirety for distribution assistance and promotional activities. The
Distributor has advised the Fund that it has incurred expenses in excess of the
distribution costs reimbursed by the Fund in the amount of $7,097,749 and
$1,990,417, for Class B and Class C shares, respectively; such costs may be
recovered from the Fund in future periods so long as the Agreement is in
effect. In accordance with the Agreement, there is no provision for recovery of
unreimbursed distribution costs incurred by the Distributor beyond the current
fiscal year for Class A shares. The Agreement also provides that the Manager
may use its own resources to finance the distribution of the Fund's shares.
- -------------------------------------------------------------------------------
18 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the period ended January 31, 2004, were as follows:
Purchases Sales
--------------- ----------------
Investment securities (excluding
U.S. government securities) $404,379,645 $391,128,381
U.S. government securities -0- -0-
The cost of investments for federal income tax purposes was substantially the
same as the cost for financial reporting purposes. Accordingly, gross
unrealized appreciation and unrealized depreciation are as follows:
Gross unrealized appreciation $280,032,861
Gross unrealized depreciation (16,252,903)
------------
Net unrealized appreciation $263,779,958
============
NOTE E
Securities Lending
The Fund has entered into a securities lending agreement with UBS Warburg LLC
(the "Lending Agent"). Under the terms of the agreement, the Lending Agent, on
behalf of the Fund, administers the lending of portfolio securities to certain
broker-dealers. In return, the Fund receives fee income from the lending
transactions or it retains a portion of interest on the investment of any cash
received as collateral. The Fund also continues to receive dividends or
interest on the securities loaned. Unrealized gain or loss on the value of the
securities loaned that may occur during the term of the loan will be reflected
in the accounts of the Fund. All loans are continuously secured by collateral
exceeding the value of the securities loaned. All collateral consists of either
cash or U.S. government securities. The Lending Agent may invest the cash
collateral received in an eligible money market vehicle in accordance with the
investment restrictions of the Fund. The Lending Agent will indemnify the Fund
for any loss resulting from a borrower's failure to return a loaned security
when due. As of January 31, 2004, the Fund had loaned securities with a value
of $95,560,961 and received cash collateral which was invested in a money
market fund valued at $98,550,100 as included in the accompanying portfolio of
investments. For the period ended January 31, 2004, the Fund earned fee income
of $42,712 which is included in the accompanying statement of operations.
NOTE F
Capital Stock
There are 12,000,000,000 shares of $0.01 par value capital stock authorized,
divided into four classes, designated Class A, Class B, Class C and Advisor
Class
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 19
shares. Each class consists of 3,000,000,000 authorized shares. Transactions in
capital stock were as follows:
Shares
----------------------------------------------------------
Six Months Ended December 1, 2002 Year Ended
January 31, 2004 to July 31, November 30,
(unaudited) 2003(a) 2002
----------------------------------------------------------
Class A
Shares sold 12,406,631 94,001,095 666,869,479
- -------------------------------------------------------------------------------
Shares converted
from Class B 363,852 338,320 699,555
- -------------------------------------------------------------------------------
Shares redeemed (15,588,748) (99,957,041) (684,023,732)
- -------------------------------------------------------------------------------
Net decrease (2,818,265) (5,617,626) (16,454,698)
==============================================================================
Class B
Shares sold 5,400,052 3,585,069 3,266,084
- -------------------------------------------------------------------------------
Shares converted
to Class A (420,440) (294,203) (796,739)
- -------------------------------------------------------------------------------
Shares redeemed (2,019,463) (2,204,819) (4,391,919)
- -------------------------------------------------------------------------------
Net increase (decrease) 2,960,149 1,086,047 (1,922,574)
==============================================================================
Class C
Shares sold 2,257,989 2,054,344 1,153,569
- -------------------------------------------------------------------------------
Shares redeemed (719,799) (1,694,149) (1,440,877)
- -------------------------------------------------------------------------------
Net increase (decrease) 1,538,190 360,195 (287,308)
==============================================================================
Advisor Class
Shares sold 3,288,672 1,513,917 24,749,469
- -------------------------------------------------------------------------------
Shares redeemed (1,643,814) (309,352) (48,366,425)
- -------------------------------------------------------------------------------
Net increase (decrease) 1,644,858 1,204,565 (23,616,956)
==============================================================================
Amount
----------------------------------------------------------
Six Months Ended December 1, 2002 Year Ended
January 31, 2004 to July 31, November 30,
(unaudited) 2003(a) 2002
----------------------------------------------------------
Class A
Shares sold $62,698,096 $338,227,909 $2,604,234,397
- -------------------------------------------------------------------------------
Shares converted
from Class B 1,914,548 1,115,899 2,861,398
- -------------------------------------------------------------------------------
Shares redeemed (77,782,922) (360,496,511) (2,681,824,281)
- -------------------------------------------------------------------------------
Net decrease $(13,170,278) $(21,152,703) $(74,728,486)
==============================================================================
Class B
Shares sold $23,747,039 $12,225,807 $11,857,211
- -------------------------------------------------------------------------------
Shares converted
to Class A (1,914,548) (1,115,899) (2,861,398)
- -------------------------------------------------------------------------------
Shares redeemed (8,934,205) (6,817,276) (14,731,968)
- -------------------------------------------------------------------------------
Net increase (decrease) $12,898,286 $4,292,632 $(5,736,155)
==============================================================================
(a) The Fund changed its fiscal year end from November 30 to July 31.
- -------------------------------------------------------------------------------
20 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Amount
----------------------------------------------------------
Six Months Ended December 1, 2002 Year Ended
January 31, 2004 to July 31, November 30,
(unaudited) 2003(a) 2002
----------------------------------------------------------
Class C
Shares sold $9,947,740 $6,777,317 $4,071,203
- -------------------------------------------------------------------------------
Shares redeemed (3,211,065) (5,137,129) (4,987,444)
- -------------------------------------------------------------------------------
Net increase (decrease) $6,736,675 $1,640,188 $(916,241)
==============================================================================
Advisor Class
Shares sold $16,532,539 $5,862,285 $112,428,321
- -------------------------------------------------------------------------------
Shares redeemed (8,650,480) (1,102,209) (172,804,180)
- -------------------------------------------------------------------------------
Net increase (decrease) $7,882,059 $4,760,076 $(60,375,859)
==============================================================================
(a) The Fund changed its fiscal year end from November 30 to July 31.
NOTE G
Components of Accumulated Earnings (Deficit)
The tax character of distributions to be paid for the year ending July 31, 2004
will be determined at the end of the current fiscal year. As of July 31, 2003,
the components of accumulated earnings/(deficit) on a tax basis were as follows:
Accumulated capital and other losses $(256,609,415)(a)
Unrealized appreciation/(depreciation) 110,228,489(b)
-------------
Total accumulated earnings/(deficit) $(146,380,926)
=============
(a) On July 31, 2003, the Fund had a net capital loss carryforward of
$256,609,415 of which $148,929,597 expires in the year 2009 and $107,679,818
expires in the year 2010. To the extent future capital gains are offset by
capital loss carryforward, such gains will not be distributed. The Fund
utilized $2,695,059 of capital loss carryforward during the year.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales.
NOTE H
Legal Proceedings
As has been previously reported in the press, the Staff of the U.S. Securities
and Exchange Commission ("SEC") and the New York Attorney General's Office
("NYAG") have been investigating practices in the mutual fund industry
identified as "market timing" and "late trading" of mutual fund shares. Certain
other regulatory authorities have also been conducting investigations into
these practices within the industry and have requested that Alliance Capital
Management L.P. ("Alliance Capital"), the Fund's Adviser, provide information
to them. Alliance Capital has been cooperating and will continue to cooperate
with all of these authorities.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 21
On December 18, 2003, Alliance Capital confirmed that it had reached terms with
the SEC and the NYAG for the resolution of regulatory claims relating to the
practice of "market timing" mutual fund shares in some of the AllianceBernstein
Mutual Funds. The agreement with the SEC is reflected in an Order of the
Commission ("SEC Order"). The agreement with the NYAG is subject to final,
definitive documentation. Among the key provisions of these agreements are the
following:
(i) Alliance Capital agreed to establish a $250 million fund (the
"Reimbursement Fund") to compensate mutual fund shareholders for the adverse
effects of market timing attributable to market timing relationships described
in the SEC Order. According to the SEC Order, the Reimbursement Fund is to be
paid, in order of priority, to fund investors based on (i) their aliquot share
of losses suffered by the fund due to market timing, and (ii) a proportionate
share of advisory fees paid by such fund during the period of such market
timing;
(ii) Alliance Capital agreed to reduce the advisory fees it receives from
some of the AllianceBernstein long-term, open-end retail funds, commencing
January 1, 2004, for a period of at least five years. The determination of
which funds will have their fees reduced and to what degree is subject to the
terms of the definitive agreement with the NYAG; and
(iii) Alliance Capital agreed to implement changes to its governance and
compliance procedures. Additionally, the SEC Order contemplates that Alliance
Capital's registered investment company clients, including the Fund, will
introduce governance and compliance changes.
The special committee of Alliance Capital's Board of Directors, comprised of
the members of Alliance Capital's Audit Committee and the other independent
member of the Board, is continuing to direct and oversee an internal
investigation and a comprehensive review of the facts and circumstances
relevant to the SEC's and the NYAG's investigations.
In addition, the Independent Directors of the Fund ("the Independent
Directors") have initiated an investigation of the above-mentioned matters with
the advice of an independent economic consultant and independent counsel. The
Independent Directors have formed a special committee to supervise the
investigation.
On October 2, 2003, a putative class action complaint entitled Hindo et al. v.
AllianceBernstein Growth & Income Fund et al. (the "Hindo Complaint") was filed
against Alliance Capital; Alliance Capital Management Holding L.P.; Alliance
Capital Management Corporation; AXA Financial, Inc.; certain of the
AllianceBernstein Mutual Funds, including the Fund; Gerald Malone; Charles
- -------------------------------------------------------------------------------
22 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Schaffran (collectively, the "Alliance Capital defendants"); and certain other
defendants not affiliated with Alliance Capital. The Hindo Complaint was filed
in the United States District Court for the Southern District of New York by
alleged shareholders of two of the AllianceBernstein Mutual Funds. The Hindo
Complaint alleges that certain of the Alliance Capital defendants failed to
disclose that they improperly allowed certain hedge funds and other
unidentified parties to engage in late trading and market timing of
AllianceBernstein Fund securities, violating Sections 11 and 15 of the
Securities Act, Sections 10(b) and 20(a) of the Exchange Act, and Sections 206
and 215 of the Advisers Act. Plaintiffs seek an unspecified amount of
compensatory damages and rescission of their contracts with Alliance Capital,
including recovery of all fees paid to Alliance Capital pursuant to such
contracts.
Since October 2, 2003, approximately 40 additional lawsuits making factual
allegations similar to those in the Hindo Complaint were filed against Alliance
Capital and certain other defendants, some of which name the Fund as a
defendant. All of these lawsuits seek an unspecified amount of damages.
As a result of the matters discussed above, investors in the AllianceBernstein
Mutual Funds may choose to redeem their investments. This may require the
AllianceBernstein Mutual Funds to sell investments held by those funds to
provide for sufficient liquidity and could also have an adverse effect on the
investment performance of the AllianceBernstein Mutual Funds.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 23
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class A
--------------------------------------------------------------------------------------------------------
Six Months
Ended December 1,
January 31, 2002 to Year Ended November 30,
2004 July 31, ---------------------------------------------------------------------
(unaudited) 2003(a) 2002 2001 2000 1999 1998
--------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c> <c> <c>
Net asset value,
beginning of period $4.46 $3.70 $4.79 $5.83 $7.55 $5.97 $8.70
--------------------------------------------------------------------------------------------------------
Income From Investment
Operations
Net investment loss(b) (.03)(c) (.03) (.04) (.04) (.04) (.03) (.02)
Net realized and unrealized
gain (loss) on investment
transactions 1.51 .79 (1.05) (.71) (1.04) 2.00 (.54)
--------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations 1.48 .76 (1.09) (.75) (1.08) 1.97 (.56)
--------------------------------------------------------------------------------------------------------
Less: Distributions
Distributions from
net realized gain
on investment
transactions -0- -0- -0- (.29) (.64) (.39) (2.17)
--------------------------------------------------------------------------------------------------------
Net asset value,
end of period $5.94 $4.46 $3.70 $4.79 $5.83 $7.55 $5.97
========================================================================================================
Total Return
Total investment return
based on net asset
value(d) 33.18% 20.54% (22.76)% (13.64)% (15.73)% 35.37% (8.48)%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $703,063 $540,843 $469,570 $686,445 $856,956 $1,128,166 $953,181
Ratio to average
net assets of:
Expenses,
net of waivers/
reimbursements 1.24%(e) 1.45%(e) 1.34% 1.22% 1.04% 1.06% 1.03%
Expenses,
before waivers/
reimbursements 1.25%(e) 1.45%(e) 1.34% 1.22% 1.04% 1.06% 1.03%
Net investment loss (1.04)%(c)(e) (1.11)%(e) (1.03)% (.69)% (.55)% (.41)% (.36)%
Portfolio turnover rate 54% 75% 183% 226% 86% 97% 106%
See footnote summary on page 27.
- -------------------------------------------------------------------------------
24 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class B
--------------------------------------------------------------------------------------------------------
Six Months
Ended December 1,
January 31, 2002 to Year Ended November 30,
2004 July 31, ---------------------------------------------------------------------
(unaudited) 2003(a) 2002 2001 2000 1999 1998
--------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c> <c> <c>
Net asset value,
beginning of period $3.87 $3.23 $4.22 $5.21 $6.87 $5.51 $8.25
--------------------------------------------------------------------------------------------------------
Income From Investment
Operations
Net investment loss(b) (.04)(c) (.03) (.07) (.07) (.09) (.07) (.07)
Net realized and unrealized
gain (loss) on investment
transactions 1.30 .67 (.92) (.63) (.93) 1.82 (.50)
--------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations 1.26 .64 (.99) (.70) (1.02) 1.75 (.57)
--------------------------------------------------------------------------------------------------------
Less: Distributions
Distributions from
net realized gain
on investment
transactions -0- -0- -0- (.29) (.64) (.39) (2.17)
--------------------------------------------------------------------------------------------------------
Net asset value,
end of period $5.13 $3.87 $3.23 $4.22 $5.21 $6.87 $5.51
========================================================================================================
Total Return
Total investment return
based on net asset
value(d) 32.56% 19.81% (23.46)% (14.34)% (16.48)% 34.24% (9.27)%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $86,050 $53,461 $41,096 $61,816 $81,569 $101,858 $85,456
Ratio to average
net assets of:
Expenses,
net of waivers/
reimbursements 2.09%(e) 2.32%(e) 2.20% 2.08% 1.87% 1.89% 1.84%
Expenses,
before waivers/
reimbursements 2.10%(e) 2.32%(e) 2.20% 2.08% 1.87% 1.89% 1.84%
Net investment loss (1.88)%(c)(e) (1.98)%(e) (1.89)% (1.54)% (1.39)% (1.23)% (1.17)%
Portfolio turnover rate 54% 75% 183% 226% 86% 97% 106%
See footnote summary on page 27.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 25
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class C
--------------------------------------------------------------------------------------------------------
Six Months
Ended December 1,
January 31, 2002 to Year Ended November 30,
2004 July 31, ---------------------------------------------------------------------
(unaudited) 2003(a) 2002 2001 2000 1999 1998
--------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c> <c> <c>
Net asset value,
beginning of period $3.87 $3.22 $4.21 $5.20 $6.86 $5.50 $8.26
--------------------------------------------------------------------------------------------------------
Income From Investment
Operations
Net investment loss(b) (.04)(c) (.03) (.06) (.07) (.09) (.08) (.07)
Net realized and unrealized
gain (loss) on investment
transactions 1.29 .68 (.93) (.63) (.93) 1.83 (.52)
--------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations 1.25 .65 (.99) (.70) (1.02) 1.75 (.59)
--------------------------------------------------------------------------------------------------------
Less: Distributions
Distributions from
net realized gain
on investment
transactions -0- -0- -0- (.29) (.64) (.39) (2.17)
--------------------------------------------------------------------------------------------------------
Net asset value,
end of period $5.12 $3.87 $3.22 $4.21 $5.20 $6.86 $5.50
========================================================================================================
Total Return
Total investment return
based on net asset
value(d) 32.30% 20.19% (23.52)% (14.37)% (16.51)% 34.31% (9.58)%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $26,988 $14,415 $10,860 $15,391 $20,068 $28,025 $21,231
Ratio to average
net assets of:
Expenses,
net of waivers/
reimbursements 2.05%(e) 2.27%(e) 2.16% 2.04% 1.86% 1.86% 1.84%
Expenses,
before waivers/
reimbursements 2.06%(e) 2.27%(e) 2.16% 2.04% 1.86% 1.86% 1.84%
Net investment loss (1.85)%(c)(e) (1.94)%(e) (1.85)% (1.51)% (1.34)% (1.22)% (1.18)%
Portfolio turnover rate 54% 75% 183% 226% 86% 97% 106%
See footnote summary on page 27.
- -------------------------------------------------------------------------------
26 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Advisor Class
--------------------------------------------------------------------------------------------------------
Six Months
Ended December 1,
January 31, 2002 to Year Ended November 30,
2004 July 31, ---------------------------------------------------------------------
(unaudited) 2003(a) 2002 2001 2000 1999 1998
--------------------------------------------------------------------------------------------------------
<s> <c> <c> <c> <c> <c> <c> <c>
Net asset value,
beginning of period $4.52 $3.74 $4.83 $5.86 $7.58 $5.98 $8.69
--------------------------------------------------------------------------------------------------------
Income From Investment
Operations
Net investment loss(b) (.02)(c) -0- (.03) (.03) (.02) (.01) (.01)
Net realized and unrealized
gain (loss) on investment
transactions 1.52 .78 (1.06) (.71) (1.06) 2.00 (.53)
--------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations 1.50 .78 (1.09) (.74) (1.08) 1.99 (.54)
--------------------------------------------------------------------------------------------------------
Less: Distributions
Distributions from
net realized gain
on investment
transactions -0- -0- -0- (.29) (.64) (.39) (2.17)
--------------------------------------------------------------------------------------------------------
Net asset value,
end of period $6.02 $4.52 $3.74 $4.83 $5.86 $7.58 $5.98
========================================================================================================
Total Return
Total investment return
based on net asset
value(d) 33.19% 20.86% (22.57)% (13.39)% (15.66)% 35.66% (8.19)%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted) $38,211 $21,251 $13,092 $131,032 $8,304 $9,970 $11,305
Ratio to average
net assets of:
Expenses,
net of waivers/
reimbursements 1.02%(e) 1.23%(e) 1.08% 1.08% .83% .85% .83%
Expenses,
before waivers/
reimbursements 1.03%(e) 1.23%(e) 1.08% 1.08% .83% .85% .83%
Net investment loss (.81)%(c)(e) (.89)%(e) (.81)% (.64)% (.35)% (.20)% (.16)%
Portfolio turnover rate 54% 75% 183% 226% 86% 97% 106%
(a) The Fund changed its fiscal year end from November 30 to July 31.
(b) Based on average shares outstanding.
(c) Net of expenses waived by the Transfer Agent.
(d) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charges or contingent
deferred sales charges are not reflected in the calculation of total investment
return. Total return does not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares. Total
investment return calculated for a period of less than one year is not
annualized.
(e) Annualized.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 27
BOARD OF DIRECTORS
William H. Foulk, Jr.(1), Chairman
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
Marc O. Mayer, President
Thomas J. Bardong, Vice President
John L. Blundin, Vice President
Alan E. Levi, Vice President
Catherine Wood(2), Vice President
Mark R. Manley, Secretary
Mark D. Gersten, Treasurer & Chief Financial Officer
Vincent S. Noto, Controller
Custodian
State Street Bank & Trust Company
225 Franklin Street
Boston, MA 02110
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 786003
San Antonio, Texas 78278-6003
Toll-Free (800) 221-5672
Independent Auditors
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036-2714
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
(1) Member of the Audit Committee.
(2) Ms. Wood is the person primarily responsible for the day-to-day management
of the Fund's investment portfolio.
- -------------------------------------------------------------------------------
28 o ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
ALLIANCEBERNSTEIN FAMILY OF FUNDS
Wealth Strategies Funds
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy*
Tax-Managed Wealth Appreciation Strategy
Tax-Managed Wealth Preservation Strategy**
Blended Style Series
U.S. Large Cap Portfolio
International Portfolio
Tax-Managed International Portfolio
Growth Funds
Domestic
Growth Fund
Health Care Fund
Mid-Cap Growth Fund
Premier Growth Fund
Small Cap Growth Fund
Technology Fund
Global & International
All-Asia Investment Fund
Global Small Cap Fund
Global Research Growth Fund
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Biotechnology Portfolio
Premier Portfolio
Technology Portfolio
Value Funds
Domestic
Balanced Shares
Disciplined Value Fund
Growth & Income Fund
Real Estate Investment Fund
Small Cap Value Fund
Utility Income Fund
Value Fund
Global & International
Global Value Fund
International Value Fund
Taxable Bond Funds
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
Municipal Bond Funds
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
Intermediate Municipal Bond Funds
Intermediate California
Intermediate Diversified
Intermediate New York
Closed-End Funds
All-Market Advantage Fund
ACM Income Fund
ACM Government Opportunity Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
We also offer Exchange Reserves,+ which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
For more complete information on any AllianceBernstein mutual fund, including
investment objectives and policies, sales charges, expenses, risks and other
matters of importance to prospective investors, visit our web site at
www.alliancebernstein.com or call us at (800) 227-4618 for a current
prospectus. Please read the prospectus carefully before you invest or send
money.
* Formerly Growth Investors Fund.
** Formerly Conservative Investors Fund.
+ An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND o 29
ALLIANCEBERNSTEIN MID-CAP GROWTH FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO] ALLIANCEBERNSTEIN (SM)
Investment Research and Management
SM This service mark used under license from
the owner, Alliance Capital Management L.P.
ALLSR0104
ITEM 2. CODE OF ETHICS.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable when filing a Semi-Annual report to shareholders.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the registrant.
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the registrant.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the registrant.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
On March 17, 2004 the Fund adopted procedures, effective April 1, 2004, by which
shareholders may recommend nominees to the Fund's Board of Directors. Prior
thereto, the Fund's Board of Directors did not accept shareholder
recommendations for nominees to the Fund's Board.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer
have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended)
are effective at the reasonable assurance level based on their evaluation of
these controls and procedures as of a date within 90 days of the filing date of
this document.
(b) There were no significant changes in the registrant's internal controls that
could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 11. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
11 (b) (1) Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
11 (b) (2) Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
11 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): AllianceBernstein Mid-Cap Growth Fund, Inc.
By: /s/Marc O. Mayer
-------------------
Marc O. Mayer
President
Date: March 31, 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/Marc O. Mayer
-------------------
Marc O. Mayer
President
Date: March 31, 2004
By: /s/Mark D. Gersten
-------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: March 31, 2004