<Page>
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 811-4269
Van Kampen Trust
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
1221 Avenue of the Americas, New York, New York 10020
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(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas, New York, New York 10020
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(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 3/31
Date of reporting period: 9/30/03
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Item 1. Report to Shareholders
VAN KAMPEN HIGH YIELD FUND
SEMIANNUAL REPORT
SEPTEMBER 30, 2003
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ENJOY LIFE'S TRUE WEALTH
[VAN KAMPEN INVESTMENTS LOGO]
GENERATIONS OF EXPERIENCE(SM)
PRIVACY NOTICE INFORMATION ON THE BACK.
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WELCOME, SHAREHOLDER
In this report, you'll learn about how your investment in Van Kampen High
Yield Fund performed during the semiannual period. The portfolio management
team will provide an overview of the market conditions and discuss some of
the factors that affected investment performance during the reporting
period. In addition, this report includes the fund's financial statements
and a list of fund investments as of September 30, 2003.
This material must be preceded or accompanied by a prospectus for the fund
being offered.
Market forecasts provided in this report may not necessarily come to pass.
There is no assurance that the fund will achieve its investment objective.
The fund is subject to market risk, which is the possibility that the
market values of securities owned by the fund will decline and, therefore,
the value of the fund shares may be less than what you paid for them.
Accordingly, you can lose money investing in this fund. Please see the
prospectus for more complete information on investment risks.
NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
<Page>
PERFORMANCE SUMMARY
<Table>
<Caption>
A SHARES B SHARES C SHARES
SINCE 6/27/86 SINCE 5/17/93 SINCE 8/13/93
---------------------------------------------------------------
AVERAGE ANNUAL W/O SALES W/SALES W/O SALES W/SALES W/O SALES W/SALES
TOTAL RETURNS CHARGES CHARGES CHARGES CHARGES CHARGES CHARGES
Since Inception 5.78% 5.49% 3.51% 3.51% 2.87% 2.87%
10-year 3.66 3.15 3.18 3.18 2.83 2.83
5-year 0.50 -0.47 -0.29 -0.47 -0.29 -0.29
1-year 24.86 19.01 23.83 19.83 23.88 22.88
6-months 11.06 5.77 10.61 6.61 10.63 9.63
- ------------------------------------------------------------------------------------
30-Day Subsidized
SEC Yield 6.47% 6.01% 6.02%
30-Day SEC Yield 6.37 5.91 5.92
</Table>
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate, and fund shares, when redeemed, may be worth
more or less than their original cost. The returns shown in this report do not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares.
As a result of recent market activity, current performance may vary from the
figures shown. For more up-to-date information, please visit vankampen.com or
speak with your financial advisor. Average annual total return with sales
charges includes payment of the maximum sales charge of 4.75 percent for Class A
shares, a contingent deferred sales charge of 4.00 percent for Class B shares
(in year one and declining to zero after year six), a contingent deferred sales
charge of 1.00 percent for Class C shares in year one and combined Rule 12b-1
fees and service fees of up to 0.25 percent for Class A shares and 1.00 percent
for Class B and C shares. The since inception and 10-year returns for Class B
and C shares reflect their conversion into Class A shares six and 10 years after
purchase, respectively. See footnote 3 in the Notes to Financial Statements for
additional information. Figures shown above assume reinvestment of all dividends
and capital gains. The fund's adviser has waived or reimbursed fees and expenses
from time to time; absent such waivers/reimbursements the fund's returns would
have been lower. SEC yield is a calculation for determining the amount of
portfolio income, excluding non-income items as prescribed by the SEC. The
subsidized SEC yields reflect some or all of the expenses that the adviser had
voluntarily waived. Yields are subject to change. Distribution rate represents
the monthly annualized distributions of the fund at the end of the period and
not the earnings of the fund.
The Credit Suisse First Boston High Yield Index is a broad based index, which
reflects the general performance of a wide range of selected bonds within the
public high-yield debt market. Index is unmanaged and does not include any sales
charges or fees. Such costs would lower performance. It is not possible to
invest directly in an index.
1
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FUND REPORT
FOR THE SIX-MONTH PERIOD ENDED SEPTEMBER 30, 2003
Van Kampen High Yield Fund is managed by the Adviser's Taxable Fixed Income
team.(1) Members of the team include Gordon Loery, Executive Director, and
Joshua Givelber and Chad Liu, Vice Presidents. The following discussion
reflects their views on the fund's performance.
Q. BEFORE YOU DISCUSS HOW THE FUND PERFORMED, PLEASE DESCRIBE THE OVERALL
MARKET ENVIRONMENT.
A. During the six-month period ended September 30, 2003, the high-yield market
continued its remarkable rally that began in October 2002. This upsurge was
triggered by a combination of improving fundamentals and declining default
rates. In addition, the rallying market drew record high-yield mutual fund
inflows, which propelled prices still higher.
The ride was not completely smooth, however. In July and early August the
high-yield market declined slightly as a consequence of heavy issuance of
new debt coupled with a few weeks of outflows from mutual funds. The market
bounced back in late August and September, however, as issuance slowed and
investors returned to high-yield securities. Continued indications of
economic recovery and a rally in Treasuries also supported the high-yield
market in September.
The strongest returns during the six-month period were earned by sectors
and securities that were most heavily out of favor during the preceding
years. Wireless communications, utilities, telecommunications and cable all
soared. These sectors benefited from a combination of improved financial
results (albeit based on greatly reduced expectations) and low valuations.
In a similar vein, performance patterns across credit tiers differed
dramatically as the lowest-rated credits rose far more than their
higher-quality peers.
Q. HOW DID THE FUND PERFORM DURING THE REPORTING PERIOD?
A. The fund underperformed its benchmark index.
- The fund returned 11.06 percent for the six months that ended
September 30, 2003. Performance figures are for Class A shares, and
assume the reinvestment of all distributions but do not reflect the
deduction of any applicable sales charges. If sales charges were
included, performance would be lower. Past performance is no guarantee
of future results.
(1) Team members may change at any time without notice.
2
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- The fund's benchmark, the Credit Suisse First Boston High Yield Index,
returned 13.08 percent for the same period.
- The fund's monthly dividend of $0.0335 translated to a distribution
rate of 7.17 percent based on the fund's maximum offering price (as of
September 30, 2003, Class A shares adjusted for sales charges).
See Performance Summary for additional information and index definition.
Q. WHAT FACTORS HINDERED PERFORMANCE DURING THE REPORTING PERIOD?
A. The primary driver of the fund's underperformance was its relatively high
credit quality. Lower-rated categories of bonds such as those rated CCC had
experienced price gains that made them unattractive to us from a
relative-value perspective. This stance held the fund back because of the
strong performance of CCC-rated debt during the period.
The fund's performance was also dampened somewhat by our security selection
within the utilities sector. Here again, the portfolio's utilities holdings
were generally at the higher end of the quality spectrum than most
constituent companies in that sector. As a result, the fund's holdings
lagged when lower-grade bonds rallied strongly.
Q. WHAT HELPED PERFORMANCE?
A. The fund's performance was helped by strong security selection in several
key sectors that appreciated sharply during the period. For example, the
wireless communications sector entered the period with generally low
valuations for most of its component companies given the sector's poor
performance for most of 2002. Our analysts identified several companies,
TOP 5 SECTORS AS OF 9/30/03
<Table>
Energy 9.1%
Utility 7.9%
Forest Products 7.1%
Chemicals 6.9%
Gaming & Leisure 6.9%
</Table>
RATING ALLOCATION AS OF 9/30/03
<Table>
BBB/Baa 5.6%
BB/Ba 35.9%
B/B 48.3%
CCC/Caa 7.0%
CC/Ca 1.0%
Non-Rated 2.2%
</Table>
Subject to change daily. All percentages are as a percentage of long-term
investments. Provided for informational purposes only and should not be deemed
as a recommendation to buy securities in the sectors shown above. Securities are
classified by sectors that represent broad groupings of related industries.
Rating allocations based upon ratings as issued by Standard and Poor's and
Moody's, respectively. Morgan Stanley is a full-service securities firm engaged
in securities trading and brokerage activities, investment banking, research and
analysis, financing and financial advisory services.
3
<Page>
such as American Cellular, SBA Communications and Dobson Communications,
that appeared to be undervalued relative to their prospects. These
companies all provided solid gains to the portfolio during the period on
the basis of improving financial results.
The fund also benefited from good bond picks in the diversified-media
sector. The portfolio's best performers in this sector included Vivendi,
which posted strong financial results and attracted further attention by
announcing their intention to sell assets and reduce debt. R.H. Donnelly
continued to post solid results from their publishing business.
Q. PLEASE WALK US THROUGH HOW YOU POSITIONED THE FUND, HIGHLIGHTING KEY
ISSUES.
A. We follow a bottom-up investment strategy. Therefore, the fund's positions
are the result of our valuation of individual securities, rather than
market sectors. We found selected companies in economically-sensitive
sectors such as chemicals and manufacturing that we believed to be
undervalued, and we added exposure in these areas. We also added positions
in consumer products and utilities companies where our analysts believed
the fundamentals to be solid and the bonds undervalued.
We also took advantage of strong market demand to trim some of the fund's
holdings in lower-rated securities that had met our price targets, and
reinvested the proceeds in bonds that offered better total-return
potential. We also followed this policy with our purchase of new securities
for the portfolio, avoiding CCC-rated bonds and focusing instead on
middle-tier credits in the BB and B categories.
Q. NOW THAT YOU'VE PROVIDED AN OVERVIEW FOR THE FUND, DO YOU HAVE ANY CLOSING
THOUGHTS?
A. We continue to believe that the fundamentals of the high-yield market will
likely remain positive for many months to come. We also believe that such a
scenario has already been priced into the market. Consequently, we expect
that the majority of the return in the high-yield market in the near future
will be driven by the coupons available from higher-yielding bonds rather
than price appreciation. We will continue to watch the market closely for
opportunities.
4
<Page>
ANNUAL HOUSEHOLDING NOTICE
To reduce fund expenses, the fund attempts to eliminate duplicate mailings
to the same address. The fund delivers a single copy of certain shareholder
documents to investors who share an address, even if the accounts are
registered under different names. The fund's prospectuses and shareholder
reports (including annual privacy notices) will be delivered to you in this
manner indefinitely unless you instruct us otherwise. You can request
multiple copies of these documents by either calling (800) 341-2911 or
writing to Van Kampen Investor Services at 1 Parkview Plaza, P.O. Box 5555,
Oakbrook Terrace, IL 60181. Once Investor Services has received your
instructions, we will begin sending individual copies for each account
within 30 days.
PROXY VOTING POLICIES AND PROCEDURES
A description of the fund's policies and procedures with respect to the
voting of proxies relating to the fund's portfolio securities is available
without charge, upon request, by calling 1-800-847-2424. This information
is also available on the Securities and Exchange Commission's website at
http://www.sec.gov.
5
<Page>
BY THE NUMBERS
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
DOMESTIC CORPORATE BONDS 82.4%
BROADCASTING 1.1%
$1,672 Interep National Radio Sales, Inc., Ser B 10.000% 07/01/08 $ 1,521,520
1,809 Nextmedia Operating, Inc. 10.750 07/01/11 2,035,125
-----------
3,556,645
-----------
BUILDING MATERIALS 0.2%
530 Koppers, Inc.,144A--Private Placement (a) (b) 9.875 10/15/13 530,000
-----------
CABLE 5.9%
635 Avalon Cable, LLC (c) 0/11.875 12/01/08 654,050
1,300 Charter Communications Holdings 8.250 04/01/07 1,111,500
245 Charter Communications Holdings 8.625 04/01/09 188,650
585 Charter Communications Holdings 10.750 10/01/09 481,162
2,275 Charter Communications Holdings (c) 0/11.750 01/15/10 1,615,250
400 CSC Holdings, Inc. 7.250 07/15/08 401,000
1,240 CSC Holdings, Inc. 8.125 07/15/09 1,283,400
1,075 CSC Holdings, Inc. 9.875 02/15/13 1,124,719
395 CSC Holdings, Inc. 10.500 05/15/16 436,475
3,060 DirecTV Holdings, LLC,
144A--Private Placement (b) 8.375 03/15/13 3,465,450
1,616 Echostar DBS Corp. 9.125 01/15/09 1,838,200
1,560 Echostar DBS Corp. 9.375 02/01/09 1,671,150
1,585 Echostar DBS Corp.,
144A--Private Placement (a) (b) 6.375 10/01/11 1,592,925
800 NTL, Inc. (d) 19.000 01/01/10 788,000
1,156 Pegasus Communications Corp., Ser B 9.750 12/01/06 919,020
790 Renaissance Media Group 10.000 04/15/08 793,950
-----------
18,364,901
-----------
CHEMICALS 5.0%
1,747 Equistar Chemicals LP 10.125 09/01/08 1,738,265
620 Equistar Chemicals LP,
144A--Private Placement (b) 10.625 05/01/11 616,900
722 FMC Corp. 10.250 11/01/09 826,690
755 Huntsman Advanced Materials LLC,
144A--Private Placement (b) 11.000 07/15/10 788,975
1,733 Huntsman ICI Chemicals, LLC 10.125 07/01/09 1,655,015
1,200 Huntsman International, LLC (EUR) (e) 10.125 07/01/09 1,244,433
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
6
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
CHEMICALS (CONTINUED)
$ 480 Huntsman International, LLC,
144A--Private Placement (b) 9.875% 03/01/09 $ 506,400
2,980 ISP Holdings, Inc. 10.625 12/15/09 3,263,100
1,045 Millennium America, Inc. 7.000 11/15/06 1,024,100
1,210 Millennium America, Inc. 9.250 06/15/08 1,261,425
1,250 Rockwood Specialties Group, Inc.,
144A--Private Placement (b) 10.625 05/15/11 1,337,500
1,265 Westlake Chemical Corp.,
144A--Private Placement (b) 8.750 07/15/11 1,318,762
-----------
15,581,565
-----------
CONSUMER PRODUCTS 1.5%
890 Elizabeth Arden, Inc., Ser B 11.750 02/01/11 1,019,050
805 Oxford Industries, Inc.,
144A--Private Placement (b) 8.875 06/01/11 861,350
960 Rayovac Corp., 144A--Private Placement (b) 8.500 10/01/13 993,600
1,800 Sleepmaster, LLC (f) (g) 11.000 05/15/09 497,250
1,260 Tempur Pedic, Inc.,
144A--Private Placement (b) 10.250 08/15/10 1,373,400
-----------
4,744,650
-----------
DIVERSIFIED MEDIA 4.2%
365 Advanstar Communications, Inc.,
144A--Private Placement (b) 10.750 08/15/10 378,687
2,580 Advanstar Communications, Inc.,
144A--Private Placement
(Variable Rate Coupon) (b) 8.630 08/15/08 2,615,475
1,305 Dex Media West Finance Corp. I,
144A--Private Placement (b) 9.875 08/15/13 1,481,175
1,270 Muzak, Inc. 10.000 02/15/09 1,333,500
1,741 Muzak, Inc. 9.875 03/15/09 1,653,950
715 PEI Holdings, Inc. 11.000 03/15/10 793,650
2,000 Primedia, Inc. 8.875 05/15/11 2,085,000
910 RH Donnelley Finance Corp. I,
144A--Private Placement (b) 10.875 12/15/12 1,078,350
1,700 Salem Communications Corp. 7.750 12/15/10 1,751,000
-----------
13,170,787
-----------
ENERGY 8.4%
2,053 BRL Universal Equipment 8.875 02/15/08 2,227,505
1,880 Chesapeake Energy Corp. 8.125 04/01/11 2,049,200
840 Citgo Petroleum Corp.,
144A--Private Placement (b) 11.375 02/01/11 953,400
617 DI Industries, Inc. 8.875 07/01/07 632,425
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
7
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
ENERGY (CONTINUED)
$2,645 El Paso Production Holding Co.,
144A--Private Placement (b) 7.750% 06/01/13 $ 2,525,975
1,915 Frontier Oil Corp. 11.750 11/15/09 2,173,525
520 GulfTerra Energy Partner LP, Ser B 8.500 06/01/10 562,900
1,943 GulfTerra Energy Partner LP, Ser B 10.625 12/01/12 2,287,882
245 Hanover Equipment Trust 8.500 09/01/08 253,575
1,038 Hanover Equipment Trust 8.750 09/01/11 1,074,330
1,695 Hilcorp Energy Finance Corp. I,
144A--Private Placement (b) 10.500 09/01/10 1,809,412
957 Magnum Hunter Resources, Inc. 9.600 03/15/12 1,047,915
335 MSW Energy Holdings Finance Corp I,
144A--Private Placement (b) 8.500 09/01/10 351,750
2,840 Pemex Project Funding Master Trust 8.625 02/01/22 3,180,800
1,360 Port Arthur Finance Corp., Ser A 12.500 01/15/09 1,584,109
895 Tesoro Petroleum Corp. 9.000 07/01/08 877,100
1,030 Tesoro Petroleum Corp. 9.625 04/01/12 1,030,000
1,760 Vintage Petroleum, Inc. 7.875 05/15/11 1,834,800
-----------
26,456,603
-----------
FOOD & DRUG 2.0%
3,135 Delhaize America, Inc. 8.125 04/15/11 3,464,175
500 Jitney-Jungle Stores America, Inc. (f) (g) (h) 12.000 03/01/06 0
1,469 Kroger Co., 144A--Private Placement (b) 8.500 07/15/17 1,673,165
1,040 Merisant Co., 144A--Private Placement (b) 9.500 07/15/13 1,118,000
-----------
6,255,340
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FOOD & TOBACCO 2.4%
1,280 Michael Foods, Inc., Ser B 11.750 04/01/11 1,504,000
745 National Beef Packing Co.,
144A--Private Placement (b) 10.500 08/01/11 815,775
1,700 Pilgrim's Pride Corp. 9.625 09/15/11 1,844,500
1,850 Smithfield Foods, Inc. 7.625 02/15/08 1,933,250
515 Smithfield Foods, Inc. 8.000 10/15/09 563,925
900 Smithfield Foods, Inc.,
144A--Private Placement (b) 7.750 05/15/13 969,750
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7,631,200
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FOREST PRODUCTS 4.1%
2,925 Georgia-Pacific Corp. 8.875 02/01/10 3,217,500
1,345 Graphic Packaging International, Inc.,
144A--Private Placement (b) 9.500 08/15/13 1,482,862
580 Louisiana Pacific Corp. 10.875 11/15/08 677,150
547 Louisiana Pacific Corp. 8.875 08/15/10 638,622
130 Owens-Brockway Glass Containers, Inc. 8.875 02/15/09 139,100
150 Owens-Brockway Glass Containers, Inc. 7.750 05/15/11 156,000
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
8
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
FOREST PRODUCTS (CONTINUED)
$1,270 Owens-Brockway Glass Containers, Inc. 8.750% 11/15/12 $ 1,368,425
585 Owens-Illinois, Inc. 7.350 05/15/08 570,375
1,730 Owens-Illinois, Inc. 7.500 05/15/10 1,678,100
200 Pliant Corp. 13.000 06/01/10 187,000
1,266 Pliant Corp. 13.000 06/01/10 1,183,710
1,747 Tekni-Plex, Inc., Ser B 12.750 06/15/10 1,720,795
-----------
13,019,639
-----------
GAMING & LEISURE 6.7%
2,530 Harrahs Operating Co., Inc. 7.875 12/15/05 2,745,050
432 Hilton Hotels Corp. 7.950 04/15/07 475,200
1,215 Hilton Hotels Corp. 7.625 12/01/12 1,333,462
223 HMH Properties, Inc. 7.875 08/01/05 229,690
1,506 HMH Properties, Inc. 7.875 08/01/08 1,554,945
2,006 Horseshoe Gaming, LLC, Ser B 8.625 05/15/09 2,158,957
950 LodgeNet Entertainment Corp. 9.500 06/15/13 1,011,750
2,510 MGM Mirage, Inc., Ser B 6.000 10/01/09 2,535,100
2,050 Park Place Entertainment Corp. 7.875 12/15/05 2,180,687
475 Park Place Entertainment Corp. 7.000 04/15/13 493,406
386 Starwood Hotels & Resorts Worldwide, Inc. 7.375 05/01/07 415,915
1,361 Starwood Hotels & Resorts Worldwide, Inc. 7.875 05/01/12 1,497,100
1,825 Station Casinos, Inc. 8.875 12/01/08 1,916,250
975 Station Casinos, Inc. 9.875 07/01/10 1,083,469
1,174 Venetian Casino Resort, LLC 11.000 06/15/10 1,344,230
-----------
20,975,211
-----------
HEALTHCARE 4.6%
1,825 AmerisourceBergen Corp. 7.250 11/15/12 1,866,062
1,000 Fisher Scientific International, Inc. 8.125 05/01/12 1,067,500
620 Fresenius Medical Care Capital Trust II 7.875 02/01/08 646,350
2,210 Fresenius Medical Care Capital Trust IV 7.875 06/15/11 2,320,500
1,104 HCA, Inc. 8.750 09/01/10 1,286,302
1,100 HCA, Inc. 6.950 05/01/12 1,168,824
445 HCA, Inc. 6.300 10/01/12 454,329
115 HCA, Inc. 7.190 11/15/15 122,417
210 Manor Care, Inc. 7.500 06/15/06 228,900
478 Manor Care, Inc. 8.000 03/01/08 537,750
505 Manor Care, Inc. 6.250 05/01/13 520,150
705 Medco Health Solutions, Inc. 7.250 08/15/13 752,774
607 Omnicare, Inc. 8.125 03/15/11 660,112
805 Omnicare, Inc. 6.125 06/01/13 792,925
940 Tenet Healthcare Corp. 6.500 06/01/12 902,400
945 Tenet Healthcare Corp. 7.375 02/01/13 956,812
-----------
14,284,107
-----------
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
9
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
HOUSING 4.8%
$1,869 CB Richard Ellis Service, Inc. 11.250% 06/15/11 $ 2,032,538
735 CBRE Escrow, Inc.,
144A--Private Placement (b) 9.750 05/15/10 799,313
1,405 D.R. Horton, Inc. 6.875 05/01/13 1,419,050
1,719 Istar Financial, Inc. 8.750 08/15/08 1,933,875
1,400 KB Home 7.750 02/01/10 1,484,000
2,290 LNR Property Corp.,
144A--Private Placement (b) 7.625 07/15/13 2,370,150
620 Meritage Corp. 9.750 06/01/11 682,000
347 Nortek Holdings, Inc. 9.250 03/15/07 359,145
599 Tech Olympic USA, Inc. 9.000 07/01/10 634,940
725 Tech Olympic USA, Inc. 9.000 07/01/10 768,500
1,074 Tech Olympic USA, Inc. 10.375 07/01/12 1,159,920
1,377 Toll Corp 8.250 02/01/11 1,507,815
-----------
15,151,246
-----------
INFORMATION TECHNOLOGY 1.9%
2,120 Avaya, Inc. 11.125 04/01/09 2,464,500
1,255 Iron Mountain, Inc. 8.625 04/01/13 1,342,850
1,325 Iron Mountain, Inc. 7.750 01/15/15 1,374,688
750 Iron Mountain, Inc. 6.625 01/01/16 714,375
-----------
5,896,413
-----------
MANUFACTURING 4.2%
295 ABB Finance, Inc. 6.750 06/03/04 298,107
691 Brand Services, Inc.,
144A--Private Placement (b) 12.000 10/15/12 767,010
2,205 Communications &
Power Industries, Inc., Ser B 12.000 08/01/05 2,249,100
480 Flowserve Corp. 12.250 08/15/10 556,800
1,470 Jacuzzi Brands, Inc.,
144A--Private Placement (b) 9.625 07/01/10 1,532,475
637 Johnsondiversey, Inc. (EUR) (e) 9.625 05/15/12 801,611
1,567 Johnsondiversey, Inc., Ser B 9.625 05/15/12 1,708,030
1,345 Manitowoc, Inc. 10.500 08/01/12 1,540,025
961 NMHG Holdings Co. 10.000 05/15/09 1,061,905
2,768 Trimas Corp. 9.875 06/15/12 2,823,360
-----------
13,338,423
-----------
METALS 2.4%
2,455 Doe Run Resources Corp.,
144A--Private Placement (b) (d) (h) 11.750 11/01/08 859,334
1,600 GS Technologies Operating, Inc. (f) (g) (h) 12.000 09/01/04 160
1,050 GS Technologies Operating, Inc. (f) (g) (h) 12.250 10/01/05 0
1,454 Intermet Corp. 9.750 06/15/09 1,439,460
995 Oregon Steel Mills, Inc. 10.000 07/15/09 820,875
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
10
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
METALS (CONTINUED)
$ 805 Republic Engineered Products, LLC (e) (j) 10.000% 08/16/09 $ 213,247
1,730 UCAR Finance, Inc. 10.250 02/15/12 1,898,675
2,085 United States Steel Corp. 9.750 05/15/10 2,147,550
-----------
7,379,301
-----------
RETAIL 3.0%
1,660 AutoNation, Inc. 9.000 08/01/08 1,867,500
890 Big 5 Corp., Ser B 10.875 11/15/07 940,063
525 Gap, Inc. 6.900 09/15/07 567,000
932 Gap, Inc. 10.550 12/15/08 1,125,390
2,535 Payless Shoesource, Inc.,
144A--Private Placement (b) 8.250 08/01/13 2,585,700
250 Penney, JC Co., Inc. 7.600 04/01/07 271,250
935 Penney, JC Co., Inc. 8.000 03/01/10 1,030,838
690 Penney, JC Co., Inc. 9.000 08/01/12 783,150
222 Penney, JC Co., Inc. 6.875 10/15/15 219,780
-----------
9,390,671
-----------
SERVICES 1.5%
440 Allied Waste North America, Inc. 8.875 04/01/08 478,500
1,650 Allied Waste North America, Inc. 10.000 08/01/09 1,796,438
1,305 Allied Waste North America, Inc. 7.875 04/15/13 1,373,513
900 Encompass Services Corp. (f) (g) (h) 10.500 05/01/09 0
1,500 Hydrochem Industrial Services, Inc., Ser B 10.375 08/01/07 1,057,500
-----------
4,705,951
-----------
TELECOMMUNICATIONS 3.2%
2,080 Cincinnati Bell, Inc.,
144A--Private Placement (b) 7.250 07/15/13 2,069,600
1,820 Exodus Communications, Inc. (f) (g) (h) 11.250 07/01/08 13,650
440 Exodus Communications, Inc. (f) (g) (h) 11.625 07/15/10 3,300
1,250 Exodus Communications, Inc. (EUR) (e) (f) (g) (h) 11.375 07/15/08 10,924
2,945 GST Network Funding, Inc. (f) (g) (h) 10.500 05/01/08 295
1,863 Knology, Inc., 144A--Private Placement (b) (d) 12.000 11/30/09 1,779,583
1,000 Park N View, Inc., Ser B (f) (g) 13.000 05/15/08 0
1,193 Primus Telecom Group 9.875 05/15/08 1,175,105
120 Primus Telecom Group 11.250 01/15/09 124,800
1,425 US West Communications, Inc. 6.625 09/15/05 1,464,188
3,545 US West Communications, Inc. 5.625 11/15/08 3,474,100
-----------
10,115,545
-----------
TRANSPORTATION 3.6%
5,435 Aetna Industries, Inc. (f) (g) (h) 11.875 10/01/06 27,175
1,495 Amsted Industries Inc.,
144A--Private Placement (b) 10.250 10/15/11 1,616,469
957 Collins & Aikman Products Co. 10.750 12/31/11 832,590
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
11
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
TRANSPORTATION (CONTINUED)
$1,660 Laidlaw International, Inc.,
144A--Private Placement (b) 10.750% 06/15/11 $ 1,788,650
2,050 Lear Corp. 8.110 05/15/09 2,367,750
2,155 Sonic Automotive Inc.,
144A--Private Placement (b) 8.625 08/15/13 2,338,175
2,195 TRW Automotive, Inc.,
144A--Private Placement (b) 9.375 02/15/13 2,480,350
-----------
11,451,159
-----------
UTILITY 7.0%
252 AES Corp. 9.375 09/15/10 258,300
183 AES Corp. 8.875 02/15/11 183,000
1,585 AES Corp., 144A--Private Placement (b) 9.000 05/15/15 1,684,063
660 Allegheny Energy, Inc. 7.750 08/01/05 666,600
1,625 Calpine Corp. 8.625 08/15/10 1,153,750
850 Calpine Corp., 144A--Private Placement (b) 8.500 07/15/10 786,250
425 CMS Energy Corp. 7.500 01/15/09 422,875
1,350 CMS Energy Corp. 8.500 04/15/11 1,380,375
1,990 Dynegy Holdings, Inc. 6.875 04/01/11 1,676,575
1,480 Dynegy Holdings, Inc.,
144A--Private Placement (a) (b) 9.875 07/15/10 1,554,000
470 IPALCO Enterprises, Inc. 7.625 11/14/11 512,300
1,555 Monongahela Power Co. 5.000 10/01/06 1,566,663
1,000 Nevada Power Co.,
144A--Private Placement (b) 9.000 08/15/13 1,037,500
330 Northwest Pipeline Corp. 8.125 03/01/10 359,700
840 PG & E Corp., 144A--Private Placement (b) 6.875 07/15/08 886,200
360 PSEG Energy Holdings, Inc. 7.750 04/16/07 360,000
1,016 PSEG Energy Holdings, Inc. 8.625 02/15/08 1,038,860
870 Southern California Edison Co.,
144A--Private Placement (b) 8.000 02/15/07 976,575
665 Southern Natural Gas Co. 8.875 03/15/10 714,875
1,000 The Williams Cos., Inc. 6.750 01/15/06 1,010,000
2,435 The Williams Cos., Inc. 7.875 09/01/21 2,313,250
600 TNP Enterprises, Inc. 10.250 04/01/10 621,000
575 Transcontinental Gas Pipe Line Corp., Ser B 8.875 07/15/12 653,344
-----------
21,816,055
-----------
WIRELESS COMMUNICATIONS 4.7%
325 American Tower Corp. 9.375 02/01/09 333,125
3,230 American Tower Corp. 6.250 10/15/09 3,092,725
1,365 Dobson Communications Corp. 10.875 07/01/10 1,494,675
1,355 MetroPCS, Inc., 144A--Private Placement (b) 10.750 10/01/11 1,388,875
3,640 Nextel Communications, Inc. 9.375 11/15/09 3,967,600
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
12
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
WIRELESS COMMUNICATIONS (CONTINUED)
$ 385 Nextel Communications, Inc. 7.375% 08/01/15 $ 390,775
1,585 Nextel Partners, Inc. 11.000 03/15/10 1,739,538
1,669 SBA Communications Corp. 12.000 03/01/08 1,769,140
532 SBA Communications Corp. 10.250 02/01/09 481,460
-----------
14,657,913
-----------
TOTAL DOMESTIC CORPORATE BONDS 82.4% 258,473,325
-----------
<Caption>
PAR
AMOUNT
IN LOCAL
CURRENCY
(000)
FOREIGN BONDS AND DEBT SECURITIES 12.4%
BRAZIL 0.1%
775 Multicanal Participacoes, Ser B (US $) (f) 12.625 06/18/04 275,125
-----------
CANADA 4.5%
1,200 360 Networks, Inc. (EUR) (f) (g) (h) 13.000 05/01/08 0
1,140 360 Networks, Inc. (US $) (f) (g) 13.000 05/01/08 0
1,590 Abitibi-Consolidated, Inc. (US $) 6.000 06/20/13 1,499,365
796 Acetex Corp. (US $) 10.875 08/01/09 885,550
1,888 Air Canada, Inc. (US $) (f) (g) 10.250 03/15/11 736,320
1,730 Alliance Atlantis Communications, Inc. (US $) 13.000 12/15/09 1,993,825
2,975 Hollinger Participation,
144A--Private Placement (US$) (b) (d) 12.125 11/15/10 3,365,376
1,200 Husky Oil Ltd. (US $) 8.900 08/15/28 1,411,500
915 Norampac, Inc.,
144A--Private Placement (US $) (b) 6.750 06/01/13 937,875
795 Pacifica Papers, Inc. (US $) 10.000 03/15/09 846,675
500 Tembec Industries, Inc. (US $) 8.625 06/30/09 495,000
2,165 Tembec Industries, Inc. (US $) 7.750 03/15/12 2,045,925
2,750 Worldwide Fiber, Inc. (US $) (f) (g) 12.000 08/01/09 275
-----------
14,217,686
-----------
COLUMBIA 0.3%
760 Republic of Columbia (US $) 9.750 04/09/11 848,902
-----------
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
13
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
PAR
AMOUNT
IN LOCAL
CURRENCY MARKET
(000) DESCRIPTION COUPON MATURITY VALUE
FRANCE 1.3%
1,905 Rhodia SA,
144A--Private Placement (US $) (b) 8.875% 06/01/11 $ 1,881,187
685 Vivendi Universal SA,
144A--Private Placement (US $) (b) 6.250 07/15/08 708,975
1,235 Vivendi Universal SA,
144A--Private Placement (US $) (b) 9.250 04/15/10 1,424,881
-----------
4,015,043
-----------
GERMANY 0.5%
1,255 Messer Griesham (EUR) 10.375 06/01/11 1,674,363
-----------
GUERNSEY 0.4%
885 ABB International Finance Ltd. (EUR) 11.000 01/15/08 1,145,765
-----------
IRELAND 0.1%
270 MDP Acquisitions PLC (US $) 9.625 10/01/12 297,000
-----------
LUXEMBOURG 1.4%
1,840 Safilo Capital International SA,
144A--Private Placement (EUR) (b) 9.625 05/15/13 1,875,971
1,415 Tyco International Group SA (US $) 6.750 02/15/11 1,499,900
995 Tyco International Group SA (US $) 6.375 10/15/11 1,031,069
-----------
4,406,940
-----------
MEXICO 1.4%
3,283 Satelites Mexicanos SA, Ser B (US $) (f) 10.125 11/01/04 1,592,255
2,608 TV Axteca SA, Ser B (US $) 10.500 02/15/07 2,738,400
-----------
4,330,655
-----------
SINGAPORE 0.3%
920 Flextronics Intl Ltd.,
144A--Private Placement (US $) (b) 6.500 05/15/13 917,700
-----------
UNITED KINGDOM 2.1%
1,230 Avecia Group PLC (US $) 11.000 07/01/09 1,082,400
1,910 JSG Funding PLC (EUR) 10.125 10/01/12 2,425,829
525 Xerox Capital Europe PLC (US $) 5.875 05/15/04 530,250
2,515 Xerox Corp. (US $) 7.125 06/15/10 2,508,713
-----------
6,547,192
-----------
TOTAL FOREIGN BONDS AND DEBT SECURITIES 12.4% 38,676,371
-----------
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
14
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
MARKET
DESCRIPTION VALUE
EQUITIES 2.8%
Decisionone Corp. (2,671 common stock warrants Class A) (h) (i) $ 0
Decisionone Corp. (4,603 common stock warrants Class B) (h) (i) 0
Decisionone Corp. (2,730 common stock warrants Class C) (h) (i) 0
Decisionone Corp. (5,234 common shares) (h) (i) 0
Dobson Communications Corp. (17,924 preferred shares) (d) 1,922,375
Dobson Communications Corp., 144A--Private Placement
(2,759 convertible preferred shares) (b) (i) 556,973
Doe Run Resources Corp. (9 common stock warrants) (h) 0
HCI Direct, Inc. (106,250 common shares) (h) (i) 828,750
Hosiery Corp. of America, Inc. (1,000 common shares) 0
ICG Communications, Inc. (2,085 common stock warrants) (h) (i) 0
Jazztel PLC (United Kingdom) (EUR) (1,550 common stock warrants) (h) (i) 0
McLeodUSA, Inc. (1,750 common shares) (i) 2,432
McLeodUSA, Inc. (12,020 preferred shares) (i) 85,222
McLeodUSA, Inc. (26,689 preferred stock warrants) (i) 13,878
Mediq, Inc. (3,684 common shares) (h) (i) 20,004
Microcell Telecommunications (Canada) (94 common shares Class A) 1,187
Microcell Telecommunications (Canada) (11,250 common shares Class B) 133,365
Microcell Telecommunications (Canada) (11,317 convertible preferred shares) 144,557
Microcell Telecommunications (Canada) (4,179 common stock warrants) 4,889
Microcell Telecommunications (Canada) (6,965 common stock warrants) 12,016
Motient Corp. (79,326 common shares) (i) 432,327
Park N View, Inc., (1,000 common stock warrants)
144A--Private Placement (b) (g) (i) 0
Paxson Communications Corp. (24,200 preferred shares) (d) 2,184,050
Republic Technologies International, Inc.,
(4,275 common stock warrants Class D)
144A--Private Placement (b) (h) (i) 43
Startec Global Communications,
(3,000 common stock warrants) 144A--Private Placement (b) (h) (i) 0
TNP Enterprises, Inc. (26,685 preferred shares) (d) 2,461,726
Ventelo (United Kingdom) (EUR) (73,021 common shares)
144A--Private Placement (b) (h) (i) 0
VS Holdings, Inc. (378,785 common shares) (h) (i) 70,719
XO Communications (6,215 common stock warrants Class A) (h) 0
XO Communications (4,661 common stock warrants Class B) (h) 0
XO Communications (4,661 common stock warrants Class C) (h) 0
XO Communications, Inc. (3,106 common shares) (i) 18,015
------------
TOTAL EQUITIES 8,892,528
------------
TOTAL LONG-TERM INVESTMENTS 97.6%
(Cost $326,412,047) 306,042,224
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
15
<Page>
YOUR FUND'S INVESTMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
<Caption>
MARKET
DESCRIPTION VALUE
REPURCHASE AGREEMENT 1.8%
State Street Bank & Trust Co. ($5,626,000 par collateralized by
U.S. Government obligations in a pooled cash account,
dated 09/30/03, to be sold on 10/01/03 at $5,626,138)
(Cost $5,626,000) $ 5,626,000
------------
TOTAL INVESTMENTS 99.4%
(Cost $332,038,047) 311,668,224
OTHER ASSETS IN EXCESS OF LIABILITIES 0.6% 2,005,599
------------
NET ASSETS 100.0% $313,673,823
============
</Table>
(a) Securities purchased on a when-issued or delayed delivery basis.
(b) 144A securities are those which are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally those
transactions with qualified institutional buyers.
(c) Security is a "step-up" bond where the coupon increases or steps up at a
predetermined date.
(d) Payment-in-kind security.
(e) This security is a United States company denominated in a foreign currency.
(f) Non-income producing as security is in default.
(g) This borrower has filed for protection in federal bankruptcy court.
(h) Market value is determined in accordance with procedures established in good
faith by the Board of Trustees.
(i) Non-income producing security.
(j) Subsequent to September 30, 2003, borrower filed for protection in federal
bankruptcy court.
(EUR)--Eurodollar
(US$)--United States Dollar
SEE NOTES TO FINANCIAL STATEMENTS
16
<Page>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
ASSETS:
Total Investments (Cost $332,038,047) $ 311,668,224
Cash 10,288
Receivables:
Interest 6,608,603
Investments Sold 5,017,895
Fund Shares Sold 1,028,956
Other 126,794
-------------
Total Assets 324,460,760
-------------
LIABILITIES:
Payables:
Fund Shares Repurchased 6,464,037
Investments Purchased 2,623,827
Income Distributions 691,175
Distributor and Affiliates 226,263
Investment Advisory Fee 171,864
Forward Foreign Currency Contracts 270,781
Trustees' Deferred Compensation and Retirement Plans 172,283
Accrued Expenses 166,707
-------------
Total Liabilities 10,786,937
-------------
NET ASSETS $ 313,673,823
=============
NET ASSETS CONSIST OF:
Capital (Par value of $.01 per share with an unlimited number of
shares authorized) $ 504,019,585
Accumulated Undistributed Net Investment Income (7,277,284)
Net Unrealized Depreciation (20,624,566)
Accumulated Net Realized Loss (162,443,912)
-------------
NET ASSETS $ 313,673,823
=============
MAXIMUM OFFERING PRICE PER SHARE:
Class A Shares:
Net asset value and redemption price per share (Based on net assets of
$194,402,943 and 36,452,040 shares of beneficial interest issued
and outstanding) $ 5.33
Maximum sales charge (4.75%* of offering price) .27
-------------
Maximum offering price to public $ 5.60
=============
Class B Shares:
Net asset value and offering price per share (Based on net assets of
$93,458,292 and 17,436,004 shares of beneficial interest issued
and outstanding) $ 5.36
=============
Class C Shares:
Net asset value and offering price per share (Based on net assets of
$25,812,588 and 4,824,014 shares of beneficial interest issued
and outstanding) $ 5.35
=============
</Table>
* On sales of $100,000 or more, the sales charge will be reduced.
SEE NOTES TO FINANCIAL STATEMENTS
17
<Page>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2003 (UNAUDITED)
<Table>
INVESTMENT INCOME:
Interest $ 13,170,838
Dividends 318,070
Other 51,797
-------------
Total Income 13,540,705
-------------
EXPENSES:
Investment Advisory Fee 1,192,754
Distribution (12b-1) and Service Fees (Attributed to Classes A, B and C ofc
$247,560, $453,234 and $126,508, respectively) 827,302
Shareholder Services 236,786
Custody 27,603
Legal 14,091
Trustees' Fees and Related Expenses 11,390
Other 181,412
-------------
Total Expenses 2,491,338
Investment Advisory Fee Reduction 159,034
Less Credits Earned on Cash Balances 1,585
-------------
Net Expenses 2,330,719
-------------
NET INVESTMENT INCOME $ 11,209,986
=============
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
Investments $ (18,912,368)
Forward Commitments (415,835)
Foreign Currency Transactions 216,370
-------------
Net Realized Loss (19,111,833)
-------------
Unrealized Appreciation/Depreciation:
Beginning of the Period (61,087,183)
End of the Period:
Investments (20,369,823)
Forward Commitments (270,781)
Foreign Currency Translation 16,038
-------------
(20,624,566)
-------------
Net Unrealized Appreciation During the Period 40,462,617
-------------
NET REALIZED AND UNREALIZED GAIN $ 21,350,784
=============
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 32,560,770
=============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
18
<Page>
STATEMENTS OF CHANGES IN NET ASSETS
(UNAUDITED)
<Table>
<Caption>
SIX MONTHS ENDED YEAR ENDED
SEPTEMBER 30, 2003 MARCH 31, 2003
----------------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income $ 11,209,986 $ 22,182,353
Net Realized Loss (19,111,833) (76,863,348)
Net Unrealized Appreciation During the Period 40,462,617 52,034,729
------------- -------------
Change in Net Assets from Operations 32,560,770 (2,646,266)
------------- -------------
Distributions from Net Investment Income:
Class A Shares (7,977,078) (16,893,277)
Class B Shares (3,221,257) (6,675,480)
Class C Shares (896,377) (1,538,765)
------------- -------------
(12,094,712) (25,107,522)
------------- -------------
Return of Capital Distribution:
Class A Shares -0- (1,933,073)
Class B Shares -0- (767,383)
Class C Shares -0- (174,600)
------------- -------------
-0- (2,875,056)
------------- -------------
Total Distributions (12,094,712) (27,982,578)
------------- -------------
NET CHANGE IN NET ASSETS FROM INVESTMENT ACTIVITIES 20,466,058 (30,628,844)
------------- -------------
FROM CAPITAL TRANSACTIONS:
Proceeds from Shares Sold 161,201,119 288,184,693
Net Asset Value of Shares Issued Through
Dividend Reinvestment 7,566,146 15,920,667
Cost of Shares Repurchased (165,950,629) (256,822,526)
------------- -------------
NET CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS 2,816,636 47,282,834
------------- -------------
TOTAL INCREASE IN NET ASSETS 23,282,694 16,653,990
NET ASSETS:
Beginning of the Period 290,391,129 273,737,139
------------- -------------
End of the Period (Including accumulated undistributed
net investment income of ($7,277,284) and
($6,392,558), respectively) $ 313,673,823 $ 290,391,129
============= =============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS
19
<Page>
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
FINANCIAL HIGHLIGHTS
(UNAUDITED)
<Table>
<Caption>
SIX MONTHS NINE MONTHS
ENDED YEAR ENDED MARCH 31, ENDED
SEPTEMBER 30, ----------------------------------------------------- MARCH 31,
CLASS A SHARES 2003 2003 2002 (c) 2001 2000 1999
--------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF THE PERIOD $ 5.00 $ 5.69 $ 7.18 $ 8.48 $ 9.03 $ 9.89
------- ------- -------- -------- ------- -------
Net Investment Income .19 .48 .69 .94 .85 .62
Net Realized and Unrealized
Gain/Loss .35 (.60) (1.38) (1.40) (.56) (.85)
------- ------- -------- -------- ------- -------
Total from Investment
Operations .54 (.12) (.69) (.46) .29 (.23)
------- ------- -------- -------- ------- -------
Less:
Distributions from
Net Investment Income .21 .51 .77 .84 .83 .62
Return of Capital Distributions -0- .06 .03 -0- .01 .01
------- ------- -------- -------- ------- -------
Total Distributions .21 .57 .80 .84 .84 .63
------- ------- -------- -------- ------- -------
NET ASSET VALUE, END OF
THE PERIOD $ 5.33 $ 5.00 $ 5.69 $ 7.18 $ 8.48 $ 9.03
======= ======= ======== ======== ======= =======
Total Return *(a) 11.06%** -1.62% -10.05% -5.64% 3.50% -2.13%**
Net Assets at End of the
Period (In millions) $ 194.4 191.0 $ 177.2 $ 205.8 $ 230.6 $ 277.9
Ratio of Expenses to
Average Net Assets *(b) 1.19% 1.21% 1.22% 1.17% 1.15% 1.17%
Ratio of Net Investment Income
to Average Net Assets * 7.31% 8.94% 10.90% 12.00% 9.96% 8.98%
Portfolio Turnover 58%** 101% 78% 85% 109% 104%**
</Table>
* If certain expenses had not been voluntarily assumed by Van Kampen, total
return would have been lower and the ratios would have been as follows:
<Table>
Ratio of Expenses to
Average Net Assets 1.29% 1.31% 1.32% 1.27% 1.25% 1.27%
Ratio of Net Investment Income
to Average Net Assets 7.21% 8.84% 10.80% 11.90% 9.86% 8.88%
</Table>
** Non-Annualized
(a) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum sales charge of 4.75% or contingent deferred
sales charge (CDSC). On purchases of $1 million or more, a CDSC of 1% may
be imposed on certain redemptions made within one year of purchase. If the
sales charge was included, total returns would be lower. These returns
include combined Rule 12b-1 fees and service fees of up to .25% and do not
reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) The Ratio of Expenses to Average Net Assets does not reflect credits earned
on cash balances. If these credits were reflected as a reduction of
expense, the ratio would decrease by .01% for the period ended March 31,
2001.
(c) As required, effective April 1, 2001, the Fund has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premium on fixed income securities. The effect of this change
for the year ended March 31, 2002 was to decrease net investment income per
share by $.01, increase net realized and unrealized gains and losses per
share by $.01 and decrease the Ratio of Net Investment Income to Average
Net Assets by .09%. Per share, ratios and supplemental data for periods
prior to March 31, 2002 have not been restated to reflect this change in
presentation.
SEE NOTES TO FINANCIAL STATEMENTS
20
<Page>
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
FINANCIAL HIGHLIGHTS
(UNAUDITED)
<Table>
<Caption>
SIX MONTHS NINE MONTHS
ENDED YEAR ENDED MARCH 31, ENDED
SEPTEMBER 30, ------------------------------------------------------- MARCH 31,
CLASS B SHARES 2003 2003 2002 (c) 2001 2000 1999
--------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF THE PERIOD $ 5.02 $ 5.71 $ 7.20 $ 8.49 $ 9.03 $ 9.89
------- ------- -------- -------- ------- -------
Net Investment Income .17 .43 .63 .87 .80 .56
Net Realized and Unrealized
Gain/Loss .36 (.59) (1.38) (1.39) (.58) (.84)
------- ------- -------- -------- ------- -------
Total from Investment
Operations .53 (.16) (.75) (.52) .22 (.28)
------- ------- -------- -------- ------- -------
Less:
Distributions from
Net Investment Income .19 .47 .72 .77 .75 .57
Return of Capital Distributions -0- .06 .02 -0- .01 .01
------- ------- -------- -------- ------- -------
Total Distributions .19 .53 .74 .77 .76 .58
------- ------- -------- -------- ------- -------
NET ASSET VALUE, END OF
THE PERIOD $ 5.36 $ 5.02 $ 5.71 $ 7.20 $ 8.49 $ 9.03
======= ======= ======== ======== ======= =======
Total Return *(a) 10.61%** -2.37% -10.70% -6.39% 2.65% -2.71%**
Net Assets at End of the
Period (In millions) $ 93.5 $ 79.6 $ 78.8 $ 92.5 $ 109.2 $ 135.4
Ratio of Expenses to
Average Net Assets *(b) 1.95% 1.96% 1.98% 1.92% 1.93% 1.93%
Ratio of Net Investment Income
to Average Net Assets * 6.55% 8.23% 10.13% 11.22% 9.17% 8.19%
Portfolio Turnover 58%** 101% 78% 85% 109% 104%**
</Table>
* If certain expenses had not been voluntarily assumed by Van Kampen, total
return would have been lower and the ratios would have been as follows:
<Table>
Ratio of Expenses to
Average Net Assets 2.05% 2.06% 2.08% 2.02% 2.03% 2.03%
Ratio of Net Investment Income
to Average Net Assets 6.45% 8.13% 10.03% 11.12% 9.07% 8.09%
</Table>
** Non-Annualized
(a) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum CDSC of 4%, charged on certain redemptions
made within one year of purchase and declining to 0% after the sixth year.
If the sales charge was included, total returns would be lower. These
returns include combined Rule 12b-1 fees and service fees of 1% and do not
reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) The Ratio of Expenses to Average Net Assets does not reflect credits earned
on cash balances. If these credits were reflected as a reduction of
expenses, the ratio would decrease by .01% for the period ended March 31,
2001.
(c) As required, effective April 1, 2001, the Fund has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premium on fixed income securities. The effect of this change
for the year ended March 31, 2002 was to decrease net investment income per
share by $.01, increase net realized and unrealized gains and losses per
share by $.01 and decrease the Ratio of Net Investment Income to Average
Net Assets by .10%. Per share, ratios and supplemental data for periods
prior to March 31, 2002 have not been restated to reflect this change in
presentation.
SEE NOTES TO FINANCIAL STATEMENTS
21
<Page>
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE SHARE OF THE FUND
OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
FINANCIAL HIGHLIGHTS
(UNAUDITED)
<Table>
<Caption>
SIX MONTHS NINE MONTHS
ENDED YEAR ENDED MARCH 31, ENDED
SEPTEMBER 30, ------------------------------------------------------- MARCH 31,
CLASS C SHARES 2003 2003 2002 (c) 2001(d) 2000 1999
--------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF THE PERIOD $ 5.01 $ 5.70 $ 7.19 $ 8.47 $ 9.02 $ 9.88
------- ------- -------- -------- ------- -------
Net Investment Income .17 .44 .63 .87 .80 .56
Net Realized and Unrealized
Gain/Loss .36 (.60) (1.38) (1.38) (.58) (.85)
------- ------- -------- -------- ------- -------
Total from Investment
Operations .53 (.16) (.75) (.51) .22 (.29)
------- ------- -------- -------- ------- -------
Less:
Distributions from
Net Investment Income .19 .47 .71 .77 .76 .56
Return of Capital Distributions -0- .06 .03 -0- .01 .01
------- ------- -------- -------- ------- -------
Total Distributions .19 .53 .74 .77 .77 .57
------- ------- -------- -------- ------- -------
NET ASSET VALUE, END OF
THE PERIOD $ 5.35 $ 5.01 $ 5.70 $ 7.19 $ 8.47 $ 9.02
======= ======= ======== ======== ======= =======
Total Return *(a) 10.63%** -2.38% -10.72% -6.40% 2.65% -2.71%**
Net Assets at End of the
Period (In millions) $ 25.8 $ 19.8 $ 17.7 $ 14.7 $ 13.0 $ 14.7
Ratio of Expenses to
Average Net Assets *(b) 1.94% 1.97% 1.97% 1.92% 1.93% 1.93%
Ratio of Net Investment Income
to Average Net Assets * 6.51% 8.23% 10.10% 11.19% 9.17% 8.25%
Portfolio Turnover 58%** 101% 78% 85% 109% 104%**
</Table>
* If certain expenses had not been voluntarily assumed by Van Kampen, total
return would have been lower and the ratios would have been as follows:
<Table>
Ratio of Expenses to
Average Net Assets 2.04% 2.07% 2.07% 2.02% 2.03% 2.03%
Ratio of Net Investment
Income to Average Net Assets 6.41% 8.13% 10.00% 11.09% 9.07% 8.15%
</Table>
** Non-Annualized
(a) Assumes reinvestment of all distributions for the period and does not
include payment of the maximum CDSC of 1%, charged on certain redemptions
made within one year of purchase. If the sales charge was included, total
returns would be lower. These returns include combined Rule 12b-1 fees and
service fees of 1% and do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund
shares.
(b) The Ratio of Expenses to Average Net Assets does not reflect credits earned
on cash balances. If these credits were reflected as a reduction of
expenses, the ratio would decrease by .01% for the period ended March 31,
2001.
(c) As required, effective April 1, 2001, the Fund has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premium on fixed income securities. The effect of this change
for the year ended March 31, 2002 was to decrease net investment income per
share by $.01, increase net realized and unrealized gains and losses per
share by $.01 and decrease the Ratio of Net Investment Income to Average
Net Assets by .09%. Per share, ratios and supplemental data for periods
prior to March 31, 2002 have not been restated to reflect this change in
presentation.
(d) Based on average shares outstanding.
SEE NOTES TO FINANCIAL STATEMENTS
22
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen High Yield Fund (the "Fund") is organized as a series of Van Kampen
Trust, a Delaware business trust (the "Trust"), and is registered as a
diversified, open-end management investment company under the Investment Company
Act of 1940 (the "1940 Act"), as amended. The Fund's primary investment
objective is to seek to provide a high level of current income. As a secondary
investment objective, the Fund seeks capital appreciation. The Fund invests
primarily in a portfolio of medium and lower grade domestic corporate debt
securities. The Fund also may invest up to 35% of its assets in foreign
government and corporate debt securities of similar quality. The Fund commenced
investment operations on June 27, 1986. The Fund commenced distribution of its
Class B and C Shares on May 17, 1993 and August 13, 1993, respectively.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
A. SECURITY VALUATION Investments are stated at value using market quotations or
indications of value obtained from an independent pricing service. For those
securities where quotations or prices are not available, valuations are obtained
from yield data relating to instruments or securities with similar
characteristics in accordance with procedures established in good faith by the
board of Trustees. Forward foreign currency contracts are valued using quoted
foreign exchange rates. Short-term securities with remaining maturities of 60
days or less are valued at amortized cost, which approximates market value.
B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Fund may purchase and sell securities on a "when-issued" or "delayed delivery"
basis, with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Fund will
segregate assets with the custodian having an aggregate value at least equal to
the amount of the when-issued or delayed delivery purchase commitments until
payment is made. At September 30, 2003, the Fund had $2,623,827 of when-issued
or delayed delivery purchase commitments.
The Fund may invest in repurchase agreements, which are short-term
investments in which the Fund acquires ownership of a debt security and the
seller agrees to repurchase the security at a future time and specified price.
The Fund may invest independently in repurchase agreements, or transfer
uninvested cash balances into a pooled cash account along with other investment
companies advised by Van Kampen Investment Advisory Corp. (the "Adviser") or its
affiliates, the daily aggregate of which is invested in repurchase agreements.
Repurchase agreements are fully collateralized by the underlying debt security.
The Fund will make payment for such securities only upon physical delivery or
evidence of book entry transfer to the account of the custodian
23
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
bank. The seller is required to maintain the value of the underlying security at
not less than the repurchase proceeds due the Fund.
C. INCOME AND EXPENSE Interest income is recorded on an accrual basis and
dividend income is recorded net of applicable withholding taxes on the
ex-dividend date. Bond premium is amortized and discount is accreted over the
expected life of each applicable security. Other income is comprised primarily
of consent fees. Consent fees are earned as compensation for agreeing to changes
in the terms of debt instruments. Income and expenses of the Fund are allocated
on a pro rata basis to each class of shares, except for distribution and service
fees and transfer agency costs which are unique to each class of shares.
D. FEDERAL INCOME TAXES It is the Fund's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required. Although the
Fund's fiscal year end is March 31, the Fund's tax year end is December 31.
The Fund intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At December 31, 2002, the Fund had an accumulated capital loss
carryforward for tax purposes of $117,136,050, which will expire between
December 31, 2003 and December 31, 2010. Of this amount, $3,655,578 will expire
on December 31, 2003.
At September 30, 2003, the cost and related gross unrealized appreciation
and depreciation are as follows:
<Table>
Cost of investments for tax purposes $332,884,787
============
Gross tax unrealized appreciation $ 22,037,396
Gross tax unrealized depreciation $(43,253,959)
------------
Net tax unrealized depreciation on investments $(21,216,563)
============
</Table>
E. DISTRIBUTION OF INCOME AND GAINS The Fund declares and pays monthly dividends
from net investment income. Net investment income for federal income tax
purposes includes gains and losses realized on foreign currency transactions.
These gains and losses are included as net realized gains and losses for
financial reporting purposes. Net realized gains, if any, are distributed
annually. Distributions from net realized gains for book purposes may include
short-term capital gains, which are included as ordinary income for tax
purposes.
24
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
The tax character of distributions paid during the year ended December 31, 2002
was as follows:
<Table>
<Caption>
12/31/2002
Distributions paid from:
Ordinary income $26,728,627
Long-term capital gain -0-
Return of Capital 4,046,957
-----------
$30,775,584
===========
</Table>
Net realized gains or losses may differ for financial and tax reporting
purposes primarily as a result of the difference in the Fund's tax year end and
the deferral of losses related to wash sale transactions.
F. CURRENCY TRANSLATION Assets and liabilities denominated in foreign currencies
and commitments under forward currency contracts are translated into U.S.
dollars at the mean of the quoted bid and ask prices of such currencies against
the U.S. dollar. Purchases and sales of portfolio securities are translated at
the rate of exchange prevailing when such securities were acquired or sold.
Realized gain and loss on foreign currency transactions on the Statement of
Operations includes the net realized amount from the sale of foreign currency
and the amount realized between trade date and settlement date on securities
transactions. Income and expenses are translated at rates prevailing when
accrued.
G. EXPENSE REDUCTIONS During the six months ended September 30, 2003, the Fund's
custody fee was reduced by $1,585 as a result of credits earned on cash
balances.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Fund's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Fund for an annual fee payable
monthly as follows:
<Table>
<Caption>
AVERAGE DAILY NET ASSETS % PER ANNUM
First $500 million .75%
Over $500 million .65%
</Table>
For the six months ended September 30, 2003, the Adviser waived
approximately $159,000 of its advisory fee. This waiver is voluntary in nature
and can be discontinued at any time.
For the six months ended September 30, 2003, the Fund recognized expenses
of approximately $4,400 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom (Illinois), counsel to the Fund, of which a trustee of the
Fund is an affiliated person.
Under separate Accounting and Legal Services agreements the Adviser
provides accounting and legal services to the Fund. The Adviser allocates the
cost of such services to each fund. For the six months ended September 30, 2003,
the Fund recognized expenses of approximately $28,200, representing Van Kampen
Investments Inc. or its affiliates' (collectively "Van Kampen") cost of
25
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
providing accounting and legal services to the Fund, which are reported as part
of "Other" and "Legal" expenses, respectively, in the Statement of Operations.
Van Kampen Investor Services Inc.(VKIS), an affiliate of the Adviser,
serves as the shareholder servicing agent for the Fund. For the six months ended
September 30, 2003, the Fund recognized expenses of approximately $192,100
representing transfer agency fees paid to VKIS. Transfer agency fees are
determined through negotiations with the Fund's Board of Trustees.
Certain officers and trustees of the Fund are also officers and directors
of Van Kampen. The Fund does not compensate its officers or trustees who are
officers of Van Kampen.
The Fund provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation.
Amounts deferred are retained by the Fund, and to the extent permitted by the
1940 Act may be invested in the common shares of those funds selected by the
trustees. Investments in such funds of approximately $102,200 are included in
"Other" assets on the Statement of Assets and Liabilities at September 30, 2003.
Appreciation/depreciation and distributions received from these investments are
recorded with an offsetting increase/decrease in the deferred compensation
obligation and do not affect the net asset value of the Fund. Benefits under the
retirement plan are payable upon retirement for a ten-year period and are based
upon each trustee's years of service to the Fund. The maximum annual benefit per
trustee under the plan is $2,500.
3. CAPITAL TRANSACTIONS
At September 30, 2003, capital aggregated $351,777,102, $122,249,179 and
$29,993,304 for Class A, B, and C Shares, respectively. For the six months ended
September 30, 2003, transactions were as follows:
<Table>
<Caption>
SHARES VALUE
Sales:
Class A 23,952,497 $ 124,583,299
Class B 4,541,236 23,747,914
Class C 2,465,066 12,869,906
----------- -------------
Total Sales 30,958,799 $ 161,201,119
=========== =============
Dividend Reinvestment:
Class A 963,847 $ 5,055,819
Class B 369,827 1,948,604
Class C 106,807 561,723
----------- -------------
Total Dividend Reinvestment 1,440,481 $ 7,566,146
=========== =============
Repurchases:
Class A (26,684,179) $(139,712,913)
Class B (3,331,036) (17,407,522)
Class C (1,693,477) (8,830,194)
----------- -------------
Total Repurchases (31,708,692) $(165,950,629)
=========== =============
</Table>
26
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
At March 31, 2003, capital aggregated $361,850,897, $113,960,183 and
$25,391,869 for Class A, B, and C Shares, respectively. For the year ended March
31, 2003, transactions were as follows:
<Table>
<Caption>
SHARES VALUE
Sales:
Class A 49,085,334 $ 242,136,134
Class B 6,554,210 33,000,674
Class C 2,604,338 13,047,885
----------- -------------
Total Sales 58,243,882 $ 288,184,693
=========== =============
Dividend Reinvestment:
Class A 2,222,567 $ 11,052,890
Class B 803,902 4,017,200
Class C 170,575 850,577
----------- -------------
Total Dividend Reinvestment 3,197,044 $ 15,920,667
=========== =============
Repurchases:
Class A (44,232,268) $(220,091,027)
Class B (5,310,124) (26,941,815)
Class C (1,933,529) (9,789,684)
----------- -------------
Total Repurchases (51,475,921) $(256,822,526)
=========== =============
</Table>
Class B Shares purchased on or after June 1, 1996, and any dividend
reinvestment plan Class B Shares received thereon, automatically convert to
Class A Shares eight years after the end of the calendar month in which the
shares were purchased. Class B Shares purchased before June 1, 1996, and any
dividend reinvestment plan Class B Shares received thereon, automatically
convert to Class A Shares six years after the end of the calendar month in which
the shares were purchased. For the six months ended September 30, 2003 and the
year ended March 31, 2003, 251,365 and 689,004 Class B Shares converted to Class
A Shares, and are shown in the above tables as sales of Class A Shares and
repurchases of Class B Shares. Class C Shares purchased before January 1, 1997,
and any dividend reinvestment plan Class C Shares received thereon,
automatically convert to Class A Shares ten years after the end of the calendar
month in which such shares were purchased. Class C Shares purchased on or after
January 1, 1997 do not possess a conversion feature. For the six months ended
September 30, 2003 and the year ended March 31, 2003, no Class C Shares
converted to Class A Shares.
27
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
Class B and C Shares are offered without a front end sales charge, but are
subject to a contingent deferred sales charge (CDSC). The CDSC will be imposed
on most redemptions made within six years of the purchase for Class B and one
year of the purchase for Class C as detailed in the following schedule.
<Table>
<Caption>
CONTINGENT DEFERRED SALES
CHARGE AS A PERCENTAGE
OF DOLLAR AMOUNT
SUBJECT TO CHARGE
-------------------------
YEAR OF REDEMPTION CLASS B CLASS C
First 4.00% 1.00%
Second 3.75% None
Third 3.50% None
Fourth 2.50% None
Fifth 1.50% None
Sixth 1.00% None
Seventh and Thereafter None None
</Table>
For the six months ended September 30, 2003, Van Kampen, as Distributor for
the Fund, received commissions on sales of the Fund's Class A Shares of
approximately $59,700, and CDSC on redeemed shares of Classes B and C of
approximately $115,400. Sales charges do not represent expenses of the Fund.
4. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $193,340,906 and $173,160,777,
respectively.
5. DERIVATIVE FINANCIAL INSTRUMENTS
A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
The Fund has a variety of reasons to use derivative instruments, such as to
attempt to protect the Fund against possible changes in the market value of its
portfolio and to manage the portfolio's effective yield, foreign currency
exposure, maturity and duration, or generate potential gain. All of the Fund's
portfolio holdings, including derivative instruments, are marked to market each
day with the change in value reflected in unrealized appreciation/depreciation.
Upon disposition, a realized gain or loss is recognized accordingly, except when
exercising a call option contract or taking delivery of a security underlying a
futures or forward contract. In these instances, the recognition of gain or loss
is postponed until the disposal of the security underlying the option, futures
or forward contract. Risks may arise as a result of the potential inability of
the counterparties to meet the terms of their contracts.
28
<Page>
NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 2003 (UNAUDITED)
Summarized below are the specific types of derivative financial instruments
used by the Fund.
A. FORWARD CURRENCY CONTRACTS These instruments are commitments to purchase or
sell a foreign currency at a future date at a negotiated forward rate. The gain
or loss arising from the difference between the original value of the contract
and the closing value of such contract is included as a component of realized
gain/loss on forwards.
At September 30, 2003, the Fund had outstanding forward currency contracts
as follows:
<Table>
<Caption>
UNREALIZED
CURRENT APPRECIATION/
VALUE DEPRECIATION
LONG CONTRACTS:
Euro Currency
600,000 expiring 10/24/03 $ 698,633 $ 18,143
SHORT CONTRACTS:
Euro Currency
3,910,000 expiring 10/24/03 4,552,758 (134,458)
Euro Currency
3,725,000 expiring 10/24/03 4,337,346 (124,371)
Euro Currency
700,000 expiring 10/24/03 815,072 (30,095)
---------
(288,924)
---------
$(270,781)
=========
</Table>
6. DISTRIBUTION AND SERVICE PLANS
With respect to its Class A Shares, Class B Shares and Class C Shares, the Fund
and its shareholders have adopted a distribution plan pursuant to Rule 12b-1
under the 1940 Act, as amended, and a service plan (collectively, the "Plans").
The Plans govern payments for: the distribution of the Fund's Class A Shares,
Class B Shares and Class C Shares; the provision of ongoing shareholder services
with respect to such classes of shares; and the maintenance of shareholder
accounts with respect to such classes of shares.
Annual fees under the Plans of up to .25% of Class A average daily net
assets and 1.00% each for Class B and Class C average daily net assets are
accrued daily. The amount of distribution expenses incurred by Van Kampen and
not yet reimbursed ("unreimbursed receivable") was approximately $1,543,300 and
$56,600 for Class B and Class C shares, respectively. These amounts may be
recovered from future payments under the distribution plan or CDSC. To the
extent the unreimbursed receivable has been fully recovered, any excess 12b-1
fees will be refunded to the Fund on a quarterly basis.
Included in these fees for the six months ended September 30, 2003, are
payments retained by Van Kampen of approximately $407,100 and payments made to
Morgan Stanley DW Inc., an affiliate of the Adviser, of approximately $34,300.
29
<Page>
VAN KAMPEN INVESTMENTS
THE VAN KAMPEN
FAMILY OF FUNDS
GLOBAL/INTERNATIONAL
Emerging Markets
Emerging Markets Income
European Value Equity
Global Equity Allocation
Global Franchise
Global Value Equity
International Advantage
International Magnum
GROWTH
Aggressive Growth
American Value
Emerging Growth
Enterprise
Equity Growth
Focus Equity
Growth
Mid Cap Growth
Pace
Select Growth
Small Cap Growth
Small Cap Value
Technology
GROWTH AND INCOME
Comstock
Equity and Income
Growth and Income
Harbor
Real Estate Securities
Utility
Value
Value Opportunities
INCOME
Corporate Bond
Government Securities
High Income Corporate Bond
High Yield
Limited Maturity Government
U.S. Government
TAX FREE
California Insured Tax Free
High Yield Municipal*
Insured Tax Free Income
Intermediate Term Municipal Income
Municipal Income
New York Tax Free Income
Pennsylvania Tax Free Income
Strategic Municipal Income
CAPITAL PRESERVATION
Reserve
Tax Free Money
SENIOR LOAN
Senior Loan Fund
For more complete information, including risk considerations, fees, sales
charges and ongoing expenses, please contact your financial advisor for a
prospectus. Please read it carefully before you invest or send money.
To view a current Van Kampen fund prospectus or to receive additional fund
information, choose from one of the following:
[ILLUSTRATION OF COMPUTER]
- - Visit our Web site at
vankampen.com.
To view a prospectus select
LITERATURE, DOWNLOAD
FUND INFO.
[ILLUSTRATION OF PHONE]
- - Call us at (800) 847-2424
Telecommunications Device
for the Deaf (TDD) users,
call (800) 421-2833.
[ILLUSTRATION OF ENVELOPES]
- - E-mail us by visiting
vankampen.com and
selecting CONTACT US
* Open to new investors for a limited time
30
<Page>
BOARD OF TRUSTEES AND IMPORTANT ADDRESSES
VAN KAMPEN HIGH YIELD FUND
BOARD OF TRUSTEES
DAVID C. ARCH
J. MILES BRANAGAN
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
MITCHELL M. MERIN*
JACK E. NELSON
RICHARD F. POWERS, III*
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY
INVESTMENT ADVISER
VAN KAMPEN INVESTMENT ADVISORY CORP.
1 Parkview Plaza
P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
DISTRIBUTOR
VAN KAMPEN FUNDS INC.
1 Parkview Plaza
P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
SHAREHOLDER SERVICING AGENT
VAN KAMPEN INVESTOR SERVICES INC.
P.O. Box 947
Jersey City, New Jersey 07303-0947
CUSTODIAN
STATE STREET BANK
AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02110
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM (ILLINOIS)
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
233 South Wacker Drive
Chicago, Illinois 60606
* "Interested persons" of the Fund, as defined in the Investment Company Act
of 1940, as amended.
31
<Page>
YOUR NOTES
<Page>
VAN KAMPEN
PRIVACY NOTICE
The Van Kampen companies and investment products* respect your right to privacy.
We also know that you expect us to conduct and process your business in an
accurate and efficient manner. To do so, we must collect and maintain certain
nonpublic personal information about you. This is information we collect from
you on applications or other forms, and from the transactions you conduct with
us, our affiliates, or third parties. We may also collect information you
provide when using our Web site, and text files (also known as "cookies") may be
placed on your computer to help us to recognize you and to facilitate
transactions you initiate. We do not disclose any nonpublic personal information
about you or any of our former customers to anyone, except as permitted by law.
For instance, so that we may continue to offer you Van Kampen investment
products and services that meet your investing needs, and to effect transactions
that you request or authorize, we may disclose the information we collect to
companies that perform services on our behalf, such as printers and mailers that
assist us in the distribution of investor materials. These companies will use
this information only for the services for which we hired them, and are not
permitted to use or share this information for any other purpose. To protect
your nonpublic personal information internally, we permit access to it only by
authorized employees, and maintain physical, electronic and procedural
safeguards to guard your nonpublic personal information.
* Includes Van Kampen Investments Inc., Van Kampen Investment Advisory Corp.,
Van Kampen Asset Management Inc., Van Kampen Advisors Inc., Van Kampen
Management Inc., Van Kampen Funds Inc., Van Kampen Investor Services Inc.,
Van Kampen System Inc. and Van Kampen Exchange Corp., as well as the many
Van Kampen mutual funds and Van Kampen unit investment trusts.
Van Kampen Funds Inc.
1 Parkview Plaza, P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
[VAN KAMPEN INVESTMENTS LOGO]
GENERATIONS OF EXPERIENCE(SM)
Copyright(C)2003 Van Kampen Funds Inc.
All rights reserved.
Member NASD/SIPC. 42, 342, 542
HYF SAR 11/03 12222K03-AP-11/03
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Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable for semi-annual reports.
Item 6. [Reserved.]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable for semi-annual reports.
Item 8. [Reserved.]
Item 9. Controls and Procedures
The Trust's principal executive officer and principal financial officer have
concluded that the Trust's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Trust in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
There were no significant changes or corrective actions with regard to
significant deficiencies or material weaknesses in the Trust's internal controls
or in other factors that could significantly affect the Trust's internal
controls subsequent to the date of their evaluation.
(b) There were 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) Code of Ethics - Not applicable for semi-annual reports.
(b) A separate certification for each Principal Executive Officer and Principal
Financial Officer of the registrant are attached hereto as part of EX-99.CERT.
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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) Van Kampen Trust
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By: /s/ Ronald E. Robison
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Name: Ronald E. Robison
Title: Principal Executive Officer
Date: November 19, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
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Name: Ronald E. Robison
Title: Principal Executive Officer
Date: November 19, 2003
By: /s/ John L. Sullivan
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Name: John L. Sullivan
Title: Principal Financial Officer
Date: November 19, 2003