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 811-10379
---------
PIMCO California Municipal Income Fund
(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)
Lawrence G. Altadonna - 1345 Avenue of the Americas, New York, New York 10105
-----------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-739-3371
------------
Date of fiscal year end: April 30
--------
Date of reporting period: October 31
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. (Section) 3507.
Item 1. Report to Shareholders SEMI-ANNUAL REPORT
10.31.03
PIMCO MUNICIPAL INCOME FUND
PIMCO CALIFORNIA MUNICIPAL INCOME FUND
PIMCO NEW YORK MUNICIPAL INCOME FUND
--------------------------------------------------------------------------------
[THE NEW YORK STOCK EXCHANGE PMF GRAPHIC OMITTED]
[THE NEW YORK STOCK EXCHANGE PCQ GRAPHIC OMITTED]
[THE NEW YORK STOCK EXCHANGE PNF GRAPHIC OMITTED]
CONTENTS
Letter to Shareholders .................................................1
Performance and Statistics ...........................................2-4
Schedules of Investments ............................................5-18
Statements of Assets and Liabilities ..................................20
Statements of Operations ..............................................21
Statements of Changes in Net Assets ................................22-23
Notes to Financial Statements ......................................24-28
Financial Highlights ...............................................30-31
Annual Shareholder Meeting Results ....................................32
[PIMCO ADVISORS LOGO]
PIMCO MUNICIPAL INCOME FUNDS LETTER TO SHAREHOLDERS
December 10, 2003
Dear Shareholder:
We are pleased to provide you with the annual report of PIMCO Municipal Income
Fund, PIMCO California Municipal Income Fund, and PIMCO New York Municipal
Income Fund ("PIMCO Municipal Income Funds" or the "Funds") for the six months
ended October 31, 2003.
Please refer to the following pages for specific information for each of the
PIMCO Municipal Income Funds. If you have any questions regarding the
information provided, please contact your financial advisor or call our
shareholder services area at 1-800-331-1710. Please note that a wide range of
information and resources can be accessed through our Web site,
www.pimcoadvisors.com.
We at the Funds, together with PIMCO Advisors Fund Management LLC, the Funds'
investment manager and Pacific Investment Management Co. LLC, the Funds'
sub-adviser, thank you for investing with us. We remain dedicated to serving
your investment needs.
Sincerely,
/s/ Stephen Treadway /s/ Brian S. Shlissel
Stephen Treadway Brian S. Shlissel
Chairman President, Chief Executive Officer
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 1
PIMCO MUNICIPAL INCOME FUND PERFORMANCE SUMMARY AND STATISTICS
OCTOBER 31, 2003 (UNAUDITED)
SYMBOL: PRIMARY INVESTMENTS: FUND INCEPTION DATE:
PMF Municipal fixed-income June 26, 2001
securities, the interest from
OBJECTIVE: which is exempt from federal TOTAL NET ASSETS(1):
To provide income income tax. $535.1 million
exempt from federal
income tax.
PORTFOLIO MANAGER:
Mark McCray
TOTAL RETURN (2): Market Price NAV
-------------------------------------------------------------------------------------------------------
Six Months 0.02% 2.25%
1 Year 0.95% 4.09%
6/26/01 (commencement of operations) to 10/31/03 2.92% 5.33%
WEEKLY COMMON SHARE PRICE PERFORMANCE: PORTFOLIO STATISTICS:
6/26/01 (commencement of operations) - 10/31/03 ----------------------------------------------
[ ] Market Price Market Price $13.73
[ ] NAV ----------------------------------------------
Net Asset Value $13.85
----------------------------------------------
Market Price Yield(3) 7.10
----------------------------------------------
[GRAPHIC OMITTED]
MARKET
PRICE NAV
----- ---
6/26/2001 15 14.32
15.1 14.31
15 14.32
15.04 14.42
15.01 14.57
15.05 14.59
15.15 14.69
15.16 14.82
15.58 14.97
15.34 14.84
15.08 14.99
15.05 14.9
15.06 14.94
14.4 14.48
14.98 14.57
15.05 14.87
14.96 14.65
14.88 14.69
14.84 14.64
14.95 14.92
14.93 15.08
14.93 14.54
14.9 14.37
15 14.45
14.75 13.98
14.99 13.92
14.2 13.96
13.87 13.97
14.6 14.05
14.48 14.38
14.72 14.44
14.67 14.23
14.86 14.32
14.95 14.41
14.96 14.35
14.83 14.53
14.92 14.48
14.7 14.09
14.76 13.97
14.44 13.89
14.3 13.91
14.47 14.1
14.45 14.2
14.28 14.06
14.6 14.22
14.6 14.29
14.63 14.13
14.64 13.97
14.65 14.17
14.79 14.29
14.88 14.36
14.85 14.44
14.8 14.45
14.75 14.42
14.95 14.49
14.98 14.48
15.1 14.57
14.94 14.66
15.02 14.54
15.06 14.54
15.05 14.5
14.92 14.43
14.96 14.51
15.04 14.74
15 14.68
15 14.83
15.11 14.83
15.11 14.91
14.99 14.75
14.69 14.18
14.14 14.1
14.79 14.25
14.72 14.45
14.5 14.29
14.22 14.16
14.18 14.13
14.21 14.29
14.25 14.27
14.33 14.35
14.23 14.35
14.45 14.38
14.28 14.29
14.4 14.18
14.22 14.26
14.25 14.24
14.49 14.25
14.25 14.29
14.35 14.33
14.3 14.35
14.48 14.45
14.56 14.42
14.13 14.17
14.45 14.22
14.33 13.77
14.18 13.76
14.2 13.99
14.21 14.01
10/31/03 13.85 13.73
(1) Inclusive of net assets attributable to Preferred Shares outstanding.
(2) PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Total return is
determined by subtracting the initial investment from the redeemable value at
the end of the period and dividing the remainder by the initial investment and
expressing the result as a percentage. The calculation assumes that all income
dividends and capital gain distributions have been reinvested at prices obtained
under the Fund's dividend reinvestment plan. Total investment return does not
reflect broker commissions or sales charges. Total return for a period greater
than one year represents the average annual total return. Total return for a
period of less than one year is not annualized.
An investment in the Fund involves risk, including the loss of principal.
Investment return, price, yield and net asset value will fluctuate with changes
in market conditions. This data is provided for information only and is not
intended for trading purposes. A portion of the income generated by the Fund may
be subject to federal, state and local taxes, and may at times be subject to the
alternative minimum tax. Closed-end funds, unlike open-end funds, are not
continuously offered. There is a one-time public offering and once issued,
shares of closed-end funds are sold in the open market through a stock exchange.
Net asset value is total assets applicable to common shareholders less total
liabilities divided by the number of common shares outstanding. Holdings are
subject to change daily.
(3) Market Price Yield is determined by dividing the current annualized per
share dividend to common shareholders by the market price per common share at
October 31, 2003.
2 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO CALIFORNIA MUNICIPAL INCOME FUND PERFORMANCE SUMMARY AND STATISTICS
October 31, 2003 (UNAUDITED)
SYMBOL: PRIMARY INVESTMENTS: INCEPTION DATE:
PCQ Municipal fixed-income June 26, 2001
securities, the interest
OBJECTIVE: from which is exempt from TOTAL NET ASSETS(1):
To provide current income federal and California State $393.5 million
exempt from federal and income tax.
California State income tax. PORTFOLIO MANAGER:
Mark McCray
TOTAL RETURN(2): Market Price NAV
---------------------------------------------------------------------------------------------------
Six Months (2.27)% (0.24)%
1 Year (3.00)% 3.07%
6/26/01 (commencement of operations) to 10/31/03 1.33% 4.30%
WEEKLY COMMON SHARE PRICE PERFORMANCE: PORTFOLIO STATISTICS:
6/26/01 (commencement of operations) to 10/31/03 -----------------------------------
[ ] Market Price Market Price $13.37
[ ] NAV -----------------------------------
Net Asset Value $13.67
-----------------------------------
Market Price Yield(3) 6.91%
-----------------------------------
[GRAPHIC OMITTED]
MARKET
PRICE NAV
----- ---
6/26/01 15.1 14.25
15.03 14.29
15.01 14.36
15.03 14.46
15.09 14.49
15.34 14.51
15.25 14.65
15.88 14.84
15.5 14.78
15.33 14.9
15.31 14.93
14.95 14.52
15 14.67
15.11 14.9
15.1 14.76
15.31 14.77
15.23 14.76
15.28 14.84
15.35 14.92
15.09 14.7
15 14.53
15.39 14.49
15.1 14.07
15.09 13.99
14.6 13.96
14.7 14.01
14.86 14.06
15.02 14.35
15.06 14.36
15.05 14.22
15.02 14.28
15.18 14.35
15.28 14.31
15.06 14.4
15.2 14.36
15.2 14
14.9 13.83
14.7 13.65
14.5 13.63
14.44 13.85
14.36 13.98
14.68 13.86
14.95 14.03
14.9 14.09
14.97 13.96
14.7 13.81
14.57 13.96
14.9 14.07
14.76 14.15
14.75 14.2
14.82 14.21
14.85 14.24
14.96 14.34
14.85 14.38
14.78 14.41
14.89 14.49
15 14.32
15.02 14.32
15.13 14.28
15.05 14.23
15.2 14.34
15.14 14.57
15.35 14.64
15.1 14.78
15.05 14.84
15.06 14.83
14.95 14.64
14.84 13.97
14.7 13.9
14.75 14.14
15.01 14.3
14.8 14.14
14.8 14.01
14.79 14
14.46 14.16
14.28 14.14
14.09 14.15
14.05 14.18
14.5 14.18
14.2 14.07
14.13 13.97
14.11 13.99
14.14 13.96
14.11 13.99
14.02 14.01
14 14.07
14.03 14.18
14.06 14.29
13.94 14.25
13.74 13.95
13.98 14.13
13.96 14.03
14.11 13.97
14.14 14.11
14.1 14.14
14.08 14.23
14.14 14.29
14.21 14.37
14.8 14.51
14.86 14.5
14.94 14.55
14.92 14.6
14.5 14.36
14.65 14.27
14.55 14.25
14.19 14.14
13.58 13.92
13.17 13.6
13.08 13.13
13.41 13.31
13.39 13
13.37 13.06
13.45 13.11
13.47 13.24
13.56 13.3
13.5 13.5
13.4 13.56
13.67 13.5
13.67 13.38
13.35 13.4
13.43 13.61
10/31/03 13.37 13.67
(1) Inclusive of net assets to attributable Preferred Shares outstanding.
(2) PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Total return is
determined by subtracting the initial investment from the redeemable value at
the end of the period and dividing the remainder by the initial investment and
expressing the result as a percentage. The calculation assumes that all income
dividends have been reinvested at prices obtained under the Fund's dividend
reinvestment plan. Total investment return does not reflect broker commissions
or sales charges. Total return for a period greater than one year represents the
average annual total return. Total return for a period of less than one year is
not annualized.
An investment in the Fund involves risk, including the loss of principal.
Investment return, price, yield and net asset value will fluctuate with changes
in market conditions. This data is provided for information only and is not
intended for trading purposes. A portion of the income generated by the Fund may
be subject to federal, state and local taxes, and may at times be subject to the
alternative minimum tax. Closed-end funds, unlike open-end funds, are not
continuously offered. There is a one-time public offering and once issued,
shares of closed-end funds are sold in the open market through a stock exchange.
Net asset value is total assets applicable to common shareholders less total
liabilities divided by the number of common shares outstanding. Holdings are
subject to change daily.
(3) Market Price Yield is determined by dividing the annualized current monthly
per share dividend to common shareholders by the market price per common share
at October 31, 2003.
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 3
PIMCO NEW YORK MUNICIPAL INCOME FUND PERFORMANCE SUMMARY AND STATISTICS
OCTOBER 31, 2003 (UNAUDITED)
SYMBOL: PRIMARY INVESTMENTS: INCEPTION DATE:
PNF Municipal fixed-income June 26, 2001
securities, the interest from
OBJECTIVE: which is exempt from federal, TOTAL NET ASSETS(1):
To provide current income New York State and New York City $161.7 million
exempt from federal, New York income tax.
State and New York City
income tax.
PORTFOLIO MANAGER:
Mark McCray
TOTAL RETURN (2): Market Price NAV
-------------------------------------------------------------------------------------------------------
Six Months 3.05% 3.14%
1 Year 0.92% 3.25%
6/26/01 (commencement of operations) to 10/31/03 1.93% 3.76%
WEEKLY COMMON SHARE PRICE PERFORMANCE: PORTFOLIO STATISTICS:
6/26/01 (commencement of operations) to 10/31/03 ----------------------------------------------
[ ] Market Price Market Price $13.50
[ ] NAV ----------------------------------------------
Net Asset Value $13.45
----------------------------------------------
Market Price Yield(3) 6.67%
----------------------------------------------
[GRAPHIC OMITTED]
MARKET
PRICE NAV
----- ---
6/26/01 15 14.32
15 14.3
15.09 14.33
15.1 14.38
15.07 14.46
15.01 14.55
15.06 14.59
15.2 14.67
15.4 14.81
15.4 14.73
15.18 14.79
15.33 14.71
15.25 14.74
14.25 14.27
14.89 14.31
14.9 14.57
14.81 14.39
14.7 14.36
14.75 14.25
14.83 14.56
15.12 14.8
14.96 14.19
14.88 13.97
14.7 14.11
14.62 13.58
14.6 13.54
13.7 13.53
13.7 13.51
13.95 13.61
14.44 14.02
14.76 14.13
14.8 13.89
14.73 13.98
14.73 14.14
14.8 14.1
14.7 14.33
14.77 14.28
14.55 13.87
14.5 13.64
13.93 13.58
14.17 13.6
14.18 13.81
14.25 13.92
14.31 13.78
14.27 13.94
14.37 13.96
14.34 13.78
14 13.55
13.96 13.71
14.1 13.85
14.33 13.9
14.31 13.99
14.32 13.98
14.27 13.93
14.44 14.02
14.9 14.02
14.7 14.11
14.58 14.17
15 14.06
14.8 14.05
14.75 14.03
14.67 13.97
14.67 14.05
14.7 14.28
14.63 14.24
14.55 14.39
14.66 14.46
14.75 14.5
14.6 14.33
14.18 13.73
14.12 13.67
14.37 13.86
14.34 14.05
13.93 13.9
14.18 13.75
14.05 13.72
13.89 13.94
13.69 13.96
13.63 14.03
13.5 14.12
13.95 14.15
13.8 13.92
13.8 13.86
13.42 13.84
13.5 13.86
13.51 13.88
13.48 13.92
13.51 13.94
13.5 13.97
13.68 14.04
13.46 14.07
13.23 13.75
13.48 13.89
13.5 13.31
13.42 13.22
13.38 13.46
13.46 13.48
10/31/03 13.55 13.49
(1)Inclusive of net assets to Preferred Shares outstanding.
(2) PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. Total return is
determined by subtracting the initial investment from the redeemable value at
the end of the period and dividing the remainder by the initial investment and
expressing the result as a percentage. The calculation assumes that all income
dividends have been reinvested at prices obtained under the Fund's dividend
reinvestment plan. Total investment return does not reflect broker commissions
or sales charges. Total return for a period greater than one year represents the
average annual total return. Total return for a period for less than one year is
not annualized.
An investment in the Fund involves risk, including the loss of principal.
Investment return, price, yield and net asset value will fluctuate with changes
in market conditions. This data is provided for information only and is not
intended for trading purposes. A portion of the income generated by the Fund may
be subject to federal, state and local taxes, and may at times be subject to the
alternative minimum tax. Closed-end funds, unlike open-end funds, are not
continuously offered. There is a one-time public offering and once issued,
shares of closed-end funds are sold in the open market through a stock exchange.
Net asset value is total assets applicable to common shareholders less total
liabilities divided by the number of common shares outstanding. Holdings are
subject to change daily.
(3) Market Price Yield is determined by dividing the annualized current monthly
per share dividend to common shareholders by the market price per common share
at October 31, 2003.
4 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
--------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS & NOTES--88.6%
ALABAMA--2.0%
$ 2,500 Birmingham Baptist Med. Ctr., Baptist Health Syst.,
5.875%, 11/15/24, Ser. A A3/NR $ 2,567,750
8,000 Huntsville Health Care Auth., 5.75%, 6/1/31, Ser. A A2/NR 8,151,280
------------
10,719,030
------------
ALASKA--0.9%
6,000 Northern Tobacco Securitization Corp., 5.50%, 6/1/29 Baa2/BBB 4,785,720
------------
ARIZONA--0.3%
2,000 Apache Cnty. Pollution Control Rev., Tucson Elec. Power Co.,
5.875%, 3/1/33 Ba3/B+ 1,856,620
------------
CALIFORNIA--1.7%
10,000 Tobacco Securization Agcy. Rev., 6.75%, 6/1/39 Baa2/BBB 9,072,100
------------
COLORADO--2.3%
3,000 Denver Health & Hosp. Auth. Healthcare Rev.,
5.375%-6.00%, 12/1/23-12/1/28, Ser. A Baa3/BBB 2,864,570
12,400 Liberty Heights Health Auth. Retirement Facs. Rev.,
zero coupon, 7/15/24 NR/AAA 4,058,892
4,965 Northwest Pkwy. Pub. Hwy. Auth., 7.125%, 6/15/41, Ser. D Ba1/BB+ 4,983,271
------------
11,906,733
------------
CONNECTICUT--0.2%
1,000 State Dev. Auth. Pollution Control Rev., Conn. Light & Power,
5.85%, 9/1/28 A3/BBB 1,050,880
------------
DISTRICT OF COLUMBIA--1.1%
6,085 Tobacco Settlement Fin. Corp., 6.25%, 5/15/24 Baa2/BBB 5,591,689
------------
FLORIDA--1.8%
9,000 Highlands Cnty. Health Fac. Auth. Rev., Adventist Health Syst.,
6.00%, 11/15/31, Ser. A A3/A 9,406,530
------------
GEORGIA-- 2.1%
10,000 Muni. Elec. Auth. Power Rev., 5.50%, 1/1/20, Ser. Z (MBIA) Aaa/AAA 11,261,800
------------
ILLINOIS--13.1%
2,675 Champaign Cnty. School Dist., GO, 5.375%, 1/1/16 (FGIC) Aaa/AAA 3,015,206
10,115 Chicago Education Board, GO, zero coupon, 12/1/31, Ser. A (FGIC) Aaa/AAA 2,175,433
9,080 Chicago, GO, 5.375%, 1/1/34, Ser. A (FGIC) Aaa/AAA 9,310,995
2,000 Chicago Water Rev., 5.25%, 11/1/27 (FGIC) Aaa/AAA 2,053,680
6,260 Dev. Fin. Auth. Hosp. Rev., Adventist Health Syst.,
5.50%-5.65%, 11/15/24-11/15/29 A3/A 6,166,351
5,000 Educational Fac. Auth. Rev., Chicago Univ., 5.25%, 7/1/41, Ser. A Aa1/AA 5,086,600
1,115 Educational Fac. Auth. Rev., Midwestern Univ.,
5.50%, 5/15/18, Ser. B NR/BBB+ 1,160,938
3,000 Health Fac. Auth. Rev., Decatur Memorial Hosp., 5.75%, 10/1/24 A2/A 3,043,560
500 Health Fac. Auth. Rev., Midwest Physician Group Ltd.,
5.50%, 11/15/19 NR/BBB- 406,815
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 5
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-------------------------------------------------------------------------------------------------------------
ILLINOIS (CONCLUDED)
$ 5,425 Health Fac. Auth. Rev., Silver Cross Hosp., 5.50%, 8/15/25 NR/A- $ 5,329,954
15,690 Lake Cnty. High School Dist., GO, zero coupon,
2/1/19-2/1/22, Ser. B (FGIC) Aaa/AAA 6,739,622
1,215 Northern Univ. Rev., Auxilary Fac. Syst., 5.00%, 4/1/16 (FGIC) Aaa/NR 1,281,011
7,345 Regional Transportation Auth., 5.50%, 6/1/23, Ser. B (FGIC) Aaa/AAA 8,081,336
2,500 State GO, 5.375%, 8/1/14 (MBIA) Aaa/AAA 2,745,875
3,000 State Sales Tax Rev., 5.125%, 6/15/20 Aa3/AAA 3,115,650
5,000 Univ. Rev., Auxiliary Fac. Syst., 5.25%, 4/1/32, Ser. B (FGIC) Aaa/AAA 5,116,700
4,000 Winnebago Boone ETC Cntys., Rock Valley Community College,
5.30%, 10/1/18 (FGIC) Aaa/NR 4,251,360
-------------
69,081,086
-------------
INDIANA--2.2%
6,500 Carmel School Bldg. Corp., 5.00%, 7/15/22 (MBIA) NR/AAA 6,628,115
2,725 Richland Beanblossom School Bldg. Corp., 5.00%, 1/15/22 (FGIC) Aaa/AAA 2,773,559
1,875 TriCreek High School Bldg. Corp., 5.00%, 7/15/20 (FSA) Aaa/AAA 1,943,400
-------------
11,345,074
-------------
KANSAS--3.9%
Wichita Hosp. Rev..
5,000 5.625%, 11/15/31, Ser III NR/A+ 5,122,500
14,370 6.25%, 11/15/24, Ser XI NR/A+ 15,347,304
-------------
20,469,804
-------------
LOUISIANA--6.3%
10,000 Local Gov't Environmental Fac., Community Dev. Auth. Rev.,
6.55%, 9/1/25 NR/A 11,079,400
27,890 Tobacco Settlement Fin. Corp. Rev., 5.875%, 5/15/39 Baa2/BBB 22,288,015
-------------
33,367,415
-------------
MARYLAND--0.7%
3,500 Baltimore Water Proj. Rev., 5.125%, 7/1/42, Ser. A (FGIC) Aaa/AAA 3,542,455
-------------
MICHIGAN--4.9%
2,000 Detroit, GO, 5.375%, 4/1/15-4/1/17, Ser. A-1 (MBIA) Aaa/AAA 2,196,180
5,650 Forest Hills Pub. School, GO, 5.25%, 5/1/18 Aa2/NR 6,023,521
3,000 Mount Clemens Community School Dist., 5.00%, 5/1/31 AaaAAA 3,025,530
50 Royal Oak Hosp. Fin. Auth., William Beaumont Hosp.,
5.25%, 11/15/35, Ser. M (MBIA) Aaa/AAA 51,116
4,000 State Hosp. Fac. Auth. Rev., Detroit Med. Ctr., 6.25%, 8/15/13 Ba1/B 3,003,400
2,500 State Strategic Oblig. Rev., Detroit Edison Co., 5.45%, 9/1/29 A3/A- 2,576,800
3,000 Taylor Tax lncrement Fin. Auth., 5.375%, 5/1/17 (FSA) Aaa/AAA 3,258,600
6,265 Wayne Charter Cnty. Airport Fac. Rev., Northwest Airlines, Inc.,
6.75%, 12/1/15 NR/NR 5,769,752
-------------
25,904,899
-------------
6 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
---------------------------------------------------------------------------------------------------------------
MINNESOTA--0.6%
$ 3,000 Agricultural & Econ. Dev. Board Rev., Health Care Syst.,
6.375%, 11/15/29, Ser. A A2/A $ 3,206,070
-------------
MISSOURI--0.5%
2,500 Interstate 470 & 350 Trans. Dev., Motranson Rev., 6.35%, 5/1/22 NR/NR 2,536,900
-------------
NEVADA--3.7%
3,000 Clark Cnty. Airport Rev., 5.25%, 7/1/34, Ser. B (FGIC) Aaa/AAA 3,048,930
12,000 Clark Cnty. Passenger Fac. Rev., 4.75%, 7/1/22 (MBIA) Aaa/AAA 12,026,400
4,250 Truckee Meadows Water Auth. Rev., 5.25%, 7/1/34, Ser. A (FSA) Aaa/AAA 4,354,635
-------------
19,429,965
-------------
NEW HAMPSHIRE--0.6%
3,000 State Bus. Fin. Auth. Pollution Control Rev.,
Conn. Light & Power Co., 5.85%, 12/1/22 A3/BBB 3,153,960
-------------
NEW JERSEY--4.1%
1,860 Camden Cnty. Improvement Auth. Rev., Cooper Health Syst.,
5.60%-6.00%, 2/15/07-2/15/27 Ba2/NR 1,739,558
3,000 Economic Dev. Auth. Rev., Arbor Glen, 5.875%, 5/15/16, Ser. A NR/NR 2,733,060
16,550 Economic Dev. Auth. Rev., Kapkowski Landfill Proj., 5.75%, 4/1/31 Baa3/NR 16,941,573
-------------
21,414,191
-------------
NEW MEXICO--0.5%
2,500 Farmington Pollution Control Rev., Public Service Co.,
5.80%, 4/1/22 Baa3/BBB- 2,501,775
-------------
NEW YORK--0.6%
2,875 Westchester Cnty. Health Care Corp. Rev.,
5.875%, 11/1/25, Ser. A A3/A 3,008,026
-------------
NORTH CAROLINA--0.6%
3,000 State Fin. Agy. Rev., Duke Univ. Proj., 5.125%, 10/1/41, Ser. A Aa1/AA+ 3,037,770
-------------
OHIO--1.3%
5,065 Lorain Cnty. Hosp. Rev., Catholic Healthcare Partners,
5.625%-5.75%, 10/1/17-10/1/18 A1/AA- 5,402,778
1,235 State Turnpike Rev., 5.50%, 2/15/15 Aa3/AA 1,364,020
-------------
6,766,798
-------------
PENNSYLVANIA--4.3%
5,780 Allegheny Cnty. Hosp. Dev. Auth. Rev., 9.25%, 11/15/30, Ser. B B2/B 5,931,841
1,000 Allegheny Cnty. Indl. Dev. Auth. Rev., USX Corp., 5.60%, 9/1/30 Baa1/BBB+ 991,680
1,095 Allegheny Cnty. Port Auth. Rev., 5.25%, 3/1/20 (FGIC) Aaa/AAA 1,159,211
2,575 Delaware Cnty. Auth. College Rev., Neumann College,
5.80%, 10/1/17 NR/BBB- 2,612,312
1,000 Philadelphia Auth. Indl. Rev., Franklin Institute, 5.20%, 6/15/26 Baa2/NR 929,640
4,610 Philadelphia Hosp. & Higher Education Fac. Hosp. Rev., Temple
Univ. Hosp., 6.625%, 11/15/23, Ser. A Baa2/BBB 4,638,859
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 7
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------
PENNSYLVANIA (CONCLUDED)
$ 6,200 State Higher Educational Fac. Auth. Rev., UPMC Health Syst.,
6.00%, 1/15/31, Ser. A NR/A $ 6,434,794
-------------
22,698,337
-------------
PUERTO RICO--0.3%
1,600 Elec. Power Auth. Rev., 5.125%, 7/1/29, Ser. NN A3/A- 1,608,976
-------------
RHODE ISLAND--2.9%
18,000 Tobacco Settlement Fin. Corp. Rev., 6.25%, 6/1/42, Ser. A Baa2/BBB 15,115,680
-------------
SOUTH CAROLINA--4.2%
5,500 Greenwood Cnty. Hosp. Rev., Self Memorial Hosp., 5.50%,
10/1/21-10/1/26 A2/A+ 5,550,230
3,000 Jobs Economic Dev. Auth. Hosp. Facs. Rev., Georgetown
Memorial Hosp., 5.375%, 2/1/30 (Radian) NR/AA 3,063,510
15,600 Tobacco Settlement Rev., 6.375%, 5/15/30, Ser. B Baa2/BBB 13,511,628
-------------
22,125,368
-------------
TENNESSEE--2.6%
4,000 Knox Health Educational & Housing Fac. Rev., Baptist Health
Syst., 6.375%, 4/15/22 Baa2/NR 4,132,960
9,320 Memphis Health Educational & Housing Fac., Wesley Housing
Corp., 6.95%, 1/1/20 (a)(b)
(acquired 6/29/01; cost $9,276,548) NR/NR 9,364,736
-------------
13,497,696
-------------
TEXAS--9.7%
2,750 Austin Convention Enterprises Inc., 5.75%, 1/1/32, Ser. B Aa3/A+ 2,879,332
4,000 Austin Water & Wastewater Syst. Rev.,
5.25%, 5/15/31, Ser. A & B (FSA) Aaa/AAA 4,099,840
2,935 Bell Cnty. Health Fac. Dev. Corp., Buckner Retirement Fac.,
5.25%, 11/15/19 NR/A- 2,900,514
2,865 Corpus Christi Refin. & Improvement, GO, 5.375%, 3/1/18 (FSA) Aaa/AAA 3,084,488
3,680 Duncanville Indpt. School Dist., 5.25%, 2/15/32, Ser. B Aaa/AAA 3,766,480
5,000 Harris Cnty. Health Fac. Dev. Corp., Christus Health,
5.375%, 7/1/29, Ser. A (MBIA) Aaa/AAA 5,136,000
7,000 Harris Cnty. Health Fac. Dev. Corp., Memorial Hermann
Healthcare, 6.375%, 6/1/29 A2/A 7,477,890
1,840 Houston Water Conveyance Syst., CP,
6.25%, 12/15/12, Ser. J (AMBAC) Aaa/AAA 2,207,890
2,000 Mansfield Indpt. School Dist., GO, 5.25%, 2/15/23 Aaa/AAA 2,071,980
4,380 Southlake Parks Dev. Corp., Sales Tax Rev.,
5.60%, 8/15/31 (AMBAC) Aaa/AAA 4,620,243
4,530 State Water Financial Assistance, 5.30%, 8/1/18, Ser. A Aa1/AA 4,835,141
7,450 Water Dev. Board Rev., 5.125%, 7/15/18 Aaa/AAA 7,752,992
-------------
50,832,790
-------------
8 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------
UTAH--1.3%
$ 7,000 Salt Lake Cnty. Hosp. Rev., IHC Health Services Inc.,
5.125%, 2/15/33 (AMBAC) Aaa/AAA $ 7,072,380
-------------
WASHINGTON--3.6%
3,120 Cowlitz Cnty. School Dist., GO, 5.625%, 12/1/14-12/1/16 (FSA) Aaa/NR 3,478,790
5,000 Kent GO, 5.375%, 12/1/20 (MBIA) Aaa/AAA 5,349,000
5,420 King Cnty. School Dist., GO, 5.25%, 12/1/21, Ser. A (MBIA) Aaa/AAA 5,692,409
4,000 Northwest Energy Elec. Rev., 5.50%, 7/1/13-7/1/15, Ser. A Aa1/AA- 4,462,620
-------------
18,982,819
-------------
WISCONSIN--3.7%
14,785 Badger Tobacco Asset Corp., 5.75%-6.00%, 6/1/12-6/1/17 Baa2/BBB 13,797,081
3,515 State GO, 5.00%, 5/1/22, Ser. A (FGIC) Aaa/AAA 3,595,493
2,230 State Health & Educational Fac. Auth. Rev.,
Kenosha Hosp. & Med. Ctr., 5.625%, 5/15/29 NR/A 2,236,601
-------------
19,629,175
-------------
Total Municipal Bonds & Notes (cost-$466,756,079) 465,980,511
-------------
VARIABLE RATE NOTES (C)(D)(E)--9.2%
HAWAII--0.7%
3,468 Honolulu City & Cnty. Wastewater Syst. Rev.,
8.59%, 7/1/23, Ser. 400 (FGIC) Aaa/NR 3,565,006
-------------
ILLINOIS--2.7%
7,253 Cook Cnty., GO, 8.66%, 11/15/28, Ser. 458 (FGIC) Aaa/NR 7,303,413
6,900 Educational Fac. Auth. Rev., 8.72%, 7/1/26 NR/AA 6,956,994
-------------
14,260,407
-------------
MASSACHUSETTS--1.0%
5,000 State Health & Educational Fac. Auth. Rev., 10.01%, 1/1/10 NR/NR 5,478,000
-------------
NEW YORK--1.3%
6,500 City Muni. Water Auth. Rev., 8.47%, 6/15/05. NR/AA 6,674,980
-------------
TEXAS--2.6%
4,250 Harris Cnty. Health Fac. Dev. Corp., 9.22% 2/15/21 NR/AA 4,316,385
8,988 Harris Cnty. Health Fac. Dev. Corp., 9.41%, 7/1/29,
Ser. 357 (MBIA) Aaa/NR 9,476,420
-------------
13,792,805
WASHINGTON--0.9% -------------
4,500 Seattle, GO, 8.84%, 12/15/28, Ser. 348
Aa1/NR 4,638,870
-------------
Total Variable Rate Notes (cost-$44,265,298) 48,410,068
-------------
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 9
PIMCO MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------
VARIABLE RATE DEMAND NOTES (C)(F)--0.7%
FLORIDA--0.3%
$1,390 Orange Cnty. School Board CP., 1.15%, 11/3/03, Ser. B (MBIA) Aaa/AAA $ 1,390,000
------------
OHIO--0.2%
1,100 Cleveland Waterworks Rev., 1.00%, 11/6/03, Ser. L (FGIC) Aaa/AAA 1,100,000
------------
TEXAS--0.1%
950 North Central Methodist Health Fac. Dev. Corp., 1.15%, 11/3/03
(MBIA) Aaa/AAA 950,000
------------
VIRGINIA--0.1%
400 Loudoun Cnty. Indl. Dev. Auth. Rev., Howard Hughes Med. Ctr.
1.15%, 11/3/03, Ser. C. Aaa/AAA 400,000
------------
Total Variable Rate Demand Notes (cost-$3,840,000) 3,840,000
------------
U.S. TREASURY BILLS (G)--1.6%
4,465 1.13%, 12/4/03 Aaa/AAA 4,461,499
250 1.14%, 12/11/03 Aaa/AAA 249,764
3,475 1.14%, 12/18/03 Aaa/AAA 3,471,042
------------
Total U.S. Treasury Bills (cost-$8,451,798) 8,182,305
------------
TOTAL INVESTMENTS BEFORE CALL OPTIONS WRITTEN (cost-$523,313,175+)--100.1% 526,412,884
------------
CALL OPTIONS WRITTEN (H)--(0.1)%
Contracts
---------
U.S. Treasury Bond Futures, Chicago Board of Trade
(700) Strike price $110, expires 11/21/03 (premium received-$905,188) (568,750)
------------
TOTAL INVESTMENTS, NET CALL OF OPTIONS WRITTEN (cost-$522,407,987+)--100.0% $525,844,134
------------
--------------------------------------------------------------------------------
+ The cost basis of portfolio securities for federal income tax purposes is
$523,313,175. Aggregate gross unrealized appreciation for securities in
which there is an excess of value over tax cost is $17,876,062; aggregate
gross unrealized depreciation for securities in which there is an excess
of tax cost over value is $14,776,353; net unrealized appreciation for
federal income tax purposes is $3,099,709.
--------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
10 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO CALIFORNIA MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-------------------------------------------------------------------------------------------------------------------
CALIFORNIA MUNICIPAL BONDS & NOTES--88.7%
$1,000 ABAG Fin. Auth. for Nonprofit Corps., CP, 5.375%, 2/15/19 NR/BBB+ $ 1,001,400
1,000 ABAG Fin. Auth. for Nonprofit Corps., Rev., 5.375%, 11/15/25 NR/BBB 1,007,250
2,745 ABC Unified School Dist., GO, zero coupon, 8/1/26-8/1/27
(FGIC) Aaa/AAA 777,387
1,385 Alvord Unified School Dist., GO, 5.375%, 8/1/29, Ser. C (FSA) Aaa/NR 1,470,150
1,650 Apple Valley, CP, 5.375%, 6/1/21 NR/BBB 1,621,406
2,000 Baldwin Park Monrovia School Facs., Grant Financing Auth.,
5.00%, 10/1/36 (AMBAC) Aaa/AAA 2,008,980
6,405 Campbell Union High School Dist., GO, 5.50%, 8/1/30 (FSA) Aaa/NR 6,750,742
2,250 Capistrano Unified School Dist., Community Fac. Dist., Special
Tax, 5.75%, 9/1/29 NR/NR 2,185,020
8,250 Carson Improvement Board Act 1915, Special Assessment,
6.35%-6.375%, 9/2/23-9/2/31 NR/NR 8,526,787
5,250 Central JT Powers Health Fin. Auth., CP, 5.75%, 2/1/31 Baa1/BBB+ 5,199,547
4,140 Charter Oak Unified School Dist., GO, 5.00%, 7/1/28, Ser. B
(FSA) Aaa/AAA 4,190,342
7,750 Contra Costa Cnty. Public Fin. Auth., Tax Allocation Rev.,
5.125%-5.85%, 8/1/19-8/1/33 NR/BBB 7,823,510
2,750 CSUCI Fin. Auth. Rev., 5.00%, 9/1/31, Ser. A, (MBIA) Aaa/AAA 2,772,825
3,635 Cucamonga Cnty. Water Dist., CP, 5.125%, 9/1/35 (FGIC) Aaa/AAA 3,697,958
1,775 Educational Fac. Auth. Rev., zero coupon, 9/1/10 (AMBAC) Aaa/AAA 1,404,628
25,215 El Monte, CP, 4.75%-5.25%, 6/1/30-1/1/34 (AMBAC) Aaa/AAA 25,356,654
10,000 Foothill Eastern Corridor Agcy., Toll Road Rev., zero coupon,
1/15/33-1/15/34 Baa3/BBB- 1,622,900
4,170 Fremont Community Fac. Dist., Special Tax.,
6.00%-6.30%, 9/1/18-9/1/31 NR/NR 4,219,665
Golden State Tobacco Securization Corp., Tobacco
Settlement Rev.,
27,655 6.25%-6.75%, 6/1/33-6/1/39, Ser. 2003-A-1, Baa2/BBB 24,687,618
540 7.875%, 6/1/42, Ser. A-1 Baa2/BBB 553,608
Health Fac. Fin. Auth. Rev.,
500 5.00%, 3/1/33 NR/A 458,810
4,000 5.00%, 7/1/18-7/1/28, Ser. A Baa2/BBB 3,736,730
5,315 5.125%, 7/1/18 NR/A- 5,333,177
3,000 5.25%, 10/1/14, Ser. B A3/A 3,144,990
6,250 Infrastructure & Economic Dev. Bank Rev.,
5.00%, 7/1/36 (AMBAC) Aaa/AAA 6,282,875
14,000 La Quinta Redev. Agcy., Tax Allocation,
5.00%-5.125%, 9/1/21-9/2/32 (AMBAC) Aaa/AAA 14,269,150
1,570 Lincoln Public Fin. Auth. Rev., 6.125%, 9/2/27 NR/NR 1,589,766
845 Los Angeles Community Redev. Agcy., Tax Allocation,
5.875%-6.00%, 9/1/26-9/1/31, Ser. B NR/NR 809,668
6,250 Los Angeles Cnty. Metropolitan Transportation Auth. Rev., Sales
Tax Rev., 4.75%, 7/1/28, Ser. B Aaa/AAA 6,169,125
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 11
PIMCO CALIFORNIA MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
---------------------------------------------------------------------------------------------------------------------
$ 3,250 Los Angeles Unified School Dist., GO, 5.125%, 7/1/21, Ser. E Aaa/AAA $ 3,386,988
Los Angeles Water & Power Rev., Ser. A-A-1,
4,500 5.00%, 7/1/11 (MBIA) Aaa/AAA 5,023,305
13,000 5.25%, 7/1/21 (FSA) Aaa/AAA 13,641,940
1,000 Menifee Union School Dist., Special Tax, 6.40%, 9/1/31 NR/NR 1,016,350
2,665 Merced Irrigation Dist. Elec. Syst. Rev., 6.50%, 9/1/22 Baa3/NR 2,762,432
3,500 Metropolitan Water Dist., Waterworks Rev.,
5.00%, 7/1/26, Ser. A Aa2/AA 3,523,730
5,820 Montclair Redev. Agcy., Tax Allocation, 5.30%, 10/1/30 (MBIA) Aaa/AAA 6,024,340
3,730 Murrieta Valley Yuma Unified School Dist., Special Tax,
6.30%-6.50%, 9/1/18-9/1/31 NR/NR 3,816,195
6,255 Orange Cnty. Santation Dist., CP, 5.25%, 2/1/30 (FGIC) Aaa/AAA 6,466,544
1,080 Palm Springs Community Redev. Agcy., Tax Allocation,
5.50%, 8/1/21 NR/A- 1,111,601
1,010 Pomona Unified School Dist., GO, 6.10%, 2/1/19, Ser. A (MBIA) Aaa/AAA 1,206,597
1,690 Rancho Etiwanda Public Fac., Special Tax, 6.375%, 9/1/24 NR/NR 1,727,535
2,770 Rancho Mirage Redev. Agcy., Tax Allocation,
5.50%-5.625%, 4/1/24-4/1/33 Baa1/BBB+ 2,818,189
8,305 Riverside Cnty., CP, 5.125%, 11/1/30 (MBIA) Aaa/AAA 8,477,495
1,000 Riverside Cnty. Pub. Financing., Tax Allocation,
5.625%, 10/1/33, Ser. A Baa2/BBB- 1,003,970
1,850 Riverside Improvement Board Act 1915, Special Assessment,
6.15%-6.375%, 9/2/19-9/2/26 NR/NR 1,875,368
575 Roseville Woodcreek Community Fac. Dist., Special Tax,
6.375%, 9/1/27 NR/NR 596,114
2,000 Sacramento Health Fac. Rev., 5.30%, 1/1/24, Ser. A NR/A+ 1,994,940
6,855 Sacramento Special Tax, 5.70%-6.15%, 9/1/21-9/1/26 NR/NR 6,847,264
545 San Diego Cnty., CP, 5.25%, 10/1/28 A2/NR 552,358
1,000 San Diego Cnty., Water Auth. Rev., CP,
4.75%-5.00%, 5/1/28-5/1/32, Ser. A Aaa/AAA 1,005,250
3,330 San Francisco Bay Area Rapid Transit Dist. Rev., 5.125%,
7/1/36 (AMBAC) Aaa/AAA 3,381,382
720 San Francisco City & Cnty. Redev. Agcy. Rev., Special Tax,
6.125%, 8/1/31, Ser. B NR/NR 723,218
5,065 San Joaquin Cnty., CP, 5.00%, 9/1/20 (MBIA) Aaa/AAA 5,230,119
San Joaquin Hills Transportation Corridor Agcy., Toll Road Rev.,
5,000 zero coupon, 1/15/19, Ser A Baa3/BBB- 3,824,750
5,000 5.50%, 1/15/28 Baa3/BBB- 4,688,600
230 San Jose Improvement Board Act 1915, Special Assessment,
5.60%, 9/2/17, Ser 24Q NR/NR 232,631
5,000 San Jose Unified School Dist., Santa Clara Cnty., GO, 5.125%,
8/1/25, Ser. D (FSA) Aaa/NR 5,103,650
26,450 San Juan Unified School Dist., GO, zero coupon, 8/1/22-8/1/26
(FSA) Aaa/AAA 8,671,270
12 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO CALIFORNIA MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
--------------------------------------------------------------------------------------------------------------
$ 600 Santa Ana Financing. Auth., Rev., 5.60% 9/1/19, Ser. C NR/BBB $ 613,242
1,815 Santa Clara, CP, 5.00%, 2/1/32 (AMBAC) Aaa/AAA 1,824,202
1,435 Santa Maria JT Union High School Dist., GO,
5.25%, 8/1/25, Ser. A (FSA) Aaa/AAA 1,499,302
Statewide Community Dev. Auth., CP,
8,000 5.375%, 4/1/30 NR/BBB 7,360,960
8,000 6.50%, 7/1/20 Baa2/BBB 8,462,960
Statewide Community Dev. Auth., Rev.,
15,250 5.125%, 10/1/30, Ser. A NR/A+ 14,430,465
4,000 5.50%, 8/15/34, Ser. B A2/A+ 4,044,040
9,900 6.625%, 10/1/31-11/1/31 NR/NR 10,046,552
2,550 6.75%, 6/1/28 (a)(b)
(acquired 7/3/01; cost-$2,550,000) NR/NR 2,566,295
10,800 Tobacco Securitization Auth. Rev.,
5.25%-5.375%, 6/1/31-6/1/41, Ser A A1/A 7,996,266
6,865 Tustin Unified School Dist., Special Tax,
5.50%-5.625%, 9/1/22-9/1/32 NR/NR 6,685,998
University Rev.,
13,250 5.00%, 5/15/11-5/15/36, Ser. A (AMBAC) Aaa/AAA 13,675,083
7,000 5.125%, 9/1/31, Ser. O (FGIC) Aaa/AAA 7,126,280
3,750 West Kern Cnty. Water Dist., CP, 5.625%, 6/1/31 Baa2/NR 3,785,475
-----------
Total California Municipal Bonds & Notes (cost-$342,479,799) 345,523,913
-----------
OTHER MUNICIPAL BONDS & NOTES-5.7%
ILLINOIS-1.4%
5,500 Educational Facs. Auth Revs., 5.00% 7/1/33, Ser. A Aa1/AA 5,499,615
LOUISIANA-0.4%
1,750 Tobacco Settlement Finance Corp., 5.875%, 5/15/39,
Ser. 2001-B A1/A 1,398,495
NEW JERSEY-1.3%
6,210 Tobacco Settlement Finance Corp., 6.00%-6.125%,
6/1/37-6/1/42 Baa2/BBB 5,116,355
PUERTO RICO-2.5%
3,050 Commonwealth, GO, 5.50%, 7/1/12 NR/AAA 3,504,450
Electric Power Auth. Power Rev.,
1,250 5.125%, 7/1/29, Ser. NN A3/A- 1,257,013
5,000 5.25%, 7/1/29, Ser. HH (FSA) Aaa/AAA 5,191,050
SOUTH CAROLINA-0.1%
340 Tobacco Settlement Rev. Management Auth., 6.375%, 5/15/30 Baa2/BBB 294,484
-----------
Total Other Municipal Bonds & Notes (cost-$21,910,660) 22,261,462
-----------
CALIFORNIA VARIABLE RATE NOTES (B)(C)(D)(E)-2.6%
10,003 Los Angeles Wastewater Syst. Rev.,
8.72%, 6/1/28, Ser. 318 (FGIC)
(acquired 7/3/01; cost-$9,043,133) NR/NR 10,180,144
-----------
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 13
PIMCO CALIFORNIA MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003 (unaudited)
Principal
Amount Credit Rating
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------------
CALIFORNIA VARIABLE RATE DEMAND NOTES (C)(F)-1.2%
$ 850 Health Facs. Financing Auth. Rev.,
1.15%, 11/3/03, Ser. B, (AMBAC) VMIG1/A1+ $ 850,000
1,800 Infrastructucture & Economic Dev. Bank Insured Rev.,
1.15%, 11/3/03, Ser. B (AMBAC) Aaa/A1+ 1,800,000
1,000 Los Angeles Water & Power Rev.,
1.14%, 11/3/03, Ser. B-3 VMIG1/A1+ 1,000,000
1,200 Metropolitan Water Dist. Southern Waterworks Rev.,
1.15%, 11/3/03 (WestDeutsche LandesBank) VMIG1/A1+ 1,200,000
------------
Total California Variable Rate Demand Notes (cost-$4,850,000) 4,850,000
------------
U.S. TREASURY BILLS (G)-1.9%
7,285 0.86%-0.96%, 12/4/03-12/18/03 (cost-$7,277,762) Aaa/AAA 7,277,762
------------
TOTAL INVESTMENTS BEFORE CALL OPTIONS WRITTEN (cost-$385,561,354+)--100.1% 390,093,281
------------
CALL OPTIONS WRITTEN (H)-(0.1)%
Contracts
-------
U.S. Treasury Bond Futures, Chicago Board of Trade
(645) Strike price $110, expires 11/21/03 (premium received-$834,065) (524,062)
------------
TOTAL INVESTMENTS, NET OF CALL OPTIONS WRITTEN (cost-$384,727,289)--100.0% $389,569,219
------------
--------------------------------------------------------------------------------
+ The cost basis of portfolio securities for federal income tax purposes is
$385,561,354. Aggregate gross unrealized appreciation for securities in
which there is an excess of value over tax cost is $9,637,722; aggregate
gross unrealized depreciation for securities in which there is an excess
of tax cost over value is $5,105,795; net unrealized appreciation for
federal income tax purposes is $4,531,927.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
14 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO NEW YORK MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------------
NEW YORK MUNICIPAL BONDS & NOTES--82.2%
$ 3,265 Albany Indl. Dev. Agcy. Civic Fac. Rev.,
5.30%, 4/1/29, Ser. A Baa2/NR $ 3,296,671
1,000 Long Island Power Auth. Elec. Syst. Rev., 5.375%,
5/1/33 Ser. L, (a)(b)
(acquired 6/29/03; cost-$999,184) Baa1/A- 1,015,690
Metropolitan Transportation Auth., NY Service Contract, Ser. A,
6,040 5.00%, 7/1/25 (FGIC) Aaa/AAA 6,107,286
8,150 5.00%, 7/1/30 (AMBAC) Aaa/AAA 8,206,398
1,375 5.125%, 1/1/29 A3/AA- 1,380,156
1,500 Monroe Tobacco Asset Securitization Corp. Rev., 6.375%, 6/1/35 Baa2/BBB 1,474,890
New York City, GO, Ser. J,
5,000 5.125%, 5/15/29 (MBIA). Aaa/AAA 5,073,200
300 5.25%, 6/1/28 A2/A 305,181
2,000 New York City Indl. Dev. Agcy. Rev., 6.00%, 11/1/28 NR/NR 1,100,000
New York City Muni. Water Fin. Auth., Water & Sewer
Syst., Rev.,
7,605 4.75%, 6/15/31 Ser. A (FGIC) Aaa/AAA 7,421,720
7,000 5.125%, 6/15/21 Ser. A (AMBAC) Aaa/AAA 7,271,530
5,000 5.125%, 6/15/33 Ser. C Aa2/AA 5,053,500
5,000 5.25%, 6/15/25 Ser. D Aa2/AA 5,156,900
2,750 New York City Transitional Fin. Auth., Rev., 4.75%, 11/15/23
Ser. B Aa2/AA+ 2,735,893
1,000 Niagara Falls Public Water Auth., Water & Sewer Syst., Rev.,
5.00%, 7/15/34, Ser. A (MBIA) Aaa/AAA 1,006,040
Port Auth. of New York & New Jersey Rev.,
5,000 5.00%, 9/1/38 A1/AA- 4,983,250
3,000 5.00%, 9/1/29 A1/AA- 3,015,750
4,515 Sachem Central School District of Holbrook, GO., 5.00%,
10/15/30, Ser B (MBIA) Aaa/AAA 4,567,780
6,550 State Dormitory Auth. Lease Rev., 4.75%, 1/15/29 Ser. 1, (FSA) Aaa/AAA 6,417,559
1,435 State Dormitory Auth. Rev., Augustana Lutheran Home for the
Aged Inc., 5.50%, 2/1/41 (MBIA) Aaa/AAA 1,491,754
100 State Dormitory Auth. Rev., Mortgage Nursing Home Rev., 5.40%,
2/1/31 (MBIA) Aaa/AAA 103,221
7,000 State Dormitory Auth. Rev., NY & Presbyterian Hosp., 4.75%,
8/1/27 (AMBAC) Aaa/AAA 6,833,890
8,000 State Dormitory Auth. Rev., Lenox Hill Hosp. Oblig. Group, 5.50%,
7/1/30 A3/NR 8,170,560
5,000 State Dormitory Auth. Rev., Memorial Sloan-Kettering Center,
Ser. 1, 5.00%, 7/1/34 Aa2/AA 4,976,350
State Dormitory Auth. Rev., Mental Health Services Fac.
Improvement, Ser D, (MBIA)
15 4.75%, 2/15/25 (Pre-refunded @ 100, 8/15/08) (i) Aaa/NR 16,824
7,985 4.75%, 2/15/25 (Pre-refunded @ 100, 8/15/08) (i) Aaa/NR 7,837,597
10.31.03 PIMCO Municipal Income Funds Semi-Annual Report 15
PIMCO NEW YORK MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------------
$ 1,825 State Dormitory Auth. Rev., Mount Sinai Health, 6.50%, 7/1/25
Ser. A Ba1/BB $ 1,829,161
845 State Dormitory Auth. Rev., New York Univ.,
5.50%, 7/1/20-7/1/21 Ser 2, (AMBAC) Aaa/AAA 911,852
State Dormitory Auth. Rev., State Univ., Ser B. (FSA)
1,045 4.75%, 5/15/28 Aaa/AAA 1,025,678
1,270 4.75%, 5/15/28 (Pre-refunded @ 101, 5/15/08) (i) Aaa/AAA 1,417,422
1,275 State Dormitory Auth. Rev., Winthrop Univ. Hosp. Assoc., 5.25%,
7/1/31 Ser. A (AMBAC) Aaa/AAA 1,309,706
5,000 State Thruway Auth. General Rev., 4.75%, 1/1/19 Ser. E Aa3/AA- 5,104,000
3,975 State Urban Dev. Corp. Rev., 4.75%, 1/1/28 Ser B, (AMBAC) Aaa/AAA 4,429,740
130 Tobacco Trust II Rev., 5.625%-5.75%, 6/1/35-6/1/43 Baa2/BBB 117,881
7,000 Triborough Bridge & Tunnel Auth. Rev.,
5.00%, 1/1/27-1/1/32, Ser. A Aa3/AA- 7,020,170
2,945 Warren & Washington Cntys, Industrial Development Agency,
Glens Falls Hospital Project, 5.00%, 12/1/27, Ser C (FSA) Aaa/AAA 2,975,098
-------------
Total New York Municipal Bonds & Notes (cost-$127,743,442) 131,160,298
-------------
OTHER MUNICIPAL BONDS & NOTES--5.9%
ILLINOIS--2.5%
4,000 Illinois Educational Facilities Auth Rev., 5.00%, 7/1/33, Ser. A Aa1/AA 3,999,720
-------------
LOUISIANA--0.4%
750 Tobacco Settlement Finance Corp., 5.875%, 5/15/39 Ser. 2001-B Baa2/BBB 599,355
-------------
PUERTO RICO--3.0%
1,500 Commonwealth Hwy. & Transportation Auth Rev., 5.25%, 7/1/38
Ser. D Baa1/A 1,513,395
2,500 Commonwealth Public Improvement 5.00%, 7/1/11, Ser A Baa1/A- 2,721,800
500 Electric Power Authority Power Rev., 5.125%, 7/1/29, Ser NN A3/A- 502,805
-------------
4,738,000
-------------
Total Other Municipal Bonds & Notes (cost-$9,331,886) 9,337,075
-------------
NEW YORK VARIABLE RATE NOTES (C)(D)(E)--8.9%
5,173 New York City Transitional Fin. Auth. Rev., Ser. 362
8.12%, 11/1/23 Aa2/NR 5,119,637
Tobacco Trust II Rev.,
4,240 9.135%, 12/1/09, 886-A A1/A 3,503,342
6,780 9.373%, 12/1/09, 886-B 9 A1/A 5,568,143
-------------
Total New York Variable Rate Notes (cost-$15,991,856) 14,191,122
-------------
16 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO NEW YORK MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
-----------------------------------------------------------------------------------------------------------------
NEW YORK VARIABLE RATE DEMAND NOTES (C)(F)--0.9%
$ 150 State Dormitory Auth. Rev., Cornell Univ., 1.15%, 11/3/03, Ser. B VMIG1/A-1+ $ 150,000
1,330 State Dormitory Auth. Rev., New York Public Library,
1.00%, 11/5/03, Ser A. VMIGI/A-1 1,330,000
------------
Total New York Variable Rate Demand Notes (cost-$1,480,000) 1,480,000
------------
U.S. TREASURY BILLS (G)--2.2%
3,535 0.915%-0.972%, 12/4/03-12/18/03 (cost--$3,531,396) Aaa/AAA 3,531,657
------------
TOTAL INVESTMENTS BEFORE CALL OPTIONS WRITTEN (cost-$158,078,580+)--100.1% 159,700,152
------------
CALL OPTIONS WRITTEN (H)--(0.1)%
Contracts U.S. Treasury Bond Futures, Chicago Board of Trade Call
---------
(61) Strike price $109, expires 11/21/03 (49,563)
(80) Strike price $110, expires 11/21/03 (98,750)
(60) Strike price $112, expires 11/21/03 (16,875)
------------
Total call options written (premiums received-$221,184) (165,188)
------------
TOTAL INVESTMENTS, NET OF CALL OPTIONS WRITTEN (cost-$157,857,396)--100.0% $159,534,964
------------
--------------------------------------------------------------------------------
+ The cost basis of portfolio securities for federal income tax purposes is
$158,078,580. Aggregate gross unrealized appreciation for securities in
which there is an excess of value over tax cost is $5,051,841; aggregate
gross unrealized depreciation for securities in which there is an excess
of tax cost over value is $3,430,271; net unrealized appreciation for
federal income tax purposes is $1,621,570.
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 17
PIMCO NEW YORK MUNICIPAL INCOME FUND SCHEDULE OF INVESTMENTS
October 31, 2003
--------------------------------------------------------------------------------
NOTES TO SCHEDULES OF INVESTMENTS:
* Long-term debt securities are valued by an independent price service
authorized by the Board of Trustees.
(a) Security deemed illiquid.
(b) Private Placement. Restricted as to resale and does not have a readily
available market; the aggregate cost and value of such securites is
$9,364,736 or 1.8% of total investments, $12,746,439 or 3.3% of total
investments and $1,015,690 or 0.6% of total investments respectively for
the Municipal, California Municipal and New York Municipal.
(c) Variable Rate Notes--instruments whose interest rates change on specified
date (such as a coupon date or interest payment date) and/or whose interest
rates vary with changes in a designated base rate (such as the prime
interest rate).
(d) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, typically to qualified institutional investors. These
securities amounted to $48,410,068 or 9.2% of total investments,
$10,180,144 or 2.6% of total investments and $14,191,122 or 8.9% of total
investments, respectively, for Municipal, California Municipal and New York
Municipal.
(e) Residual Interest/Tax Exempt Municipal Bonds. The interest rate shown bears
an inverse relationship to the interest rate on another security or the
value of an index.
(f) Maturity date shown is date of next call.
(g) All or partial principal amount segregated as initial margin on futures
contracts.
(h) Non-income producing security.
(i) Pre-refunded bonds are collateralized by U.S. Government or other eligible
securities which are held in escrow and used to pay principal and interest
and retire the bonds at the earliest refunding date.
--------------------------------------------------------------------------------
GLOSSARY:
AMBAC -- insured by American Municipal Bond Assurance Corp.
FGIC -- insured by insured Financial Guaranty Insurance Co.
FSA -- insured by Financial Security Assurance, Inc.
GO -- General Obligation Bonds
MBIA -- insured by Municipal Bond Investors Assurance
NR -- Not Rated
Radian -- insured by Radian Guaranty Inc.
RITES -- Residual Interest Tax Exempt Securities
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
18 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
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10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 19
PIMCO MUNICIPAL INCOME FUNDS STATEMENTS OF ASSETS AND LIABILITIES
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
California New York
Municipal Municipal Municipal
------------- ------------- ------------
ASSETS:
Investments, at value (cost-$523,313,175, $385,561,354
and $158,078,580, respectively) $ 526,412,884 $ 390,093,281 $159,700,150
-------------------------------------------------------- ------------- ------------- ------------
Cash 113,904 147,610 --
-------------------------------------------------------- ------------- ------------- ------------
Interest receivable 10,702,367 5,531,783 2,817,547
-------------------------------------------------------- ------------- ------------- ------------
Receivable for investments called 821,100 -- 89,700
-------------------------------------------------------- ------------- ------------- ------------
Prepaid expenses 33,776 23,980 7,943
-------------------------------------------------------- ------------- ------------- ------------
Total Assets 538,084,031 395,796,654 162,615,340
-------------------------------------------------------- ------------- ------------- ------------
LIABILITIES:
Due to custodian -- -- 1,476
-------------------------------------------------------- ------------- ------------- ------------
Dividends payable to common and preferred shareholders 1,979,170 1,381,602 554,190
-------------------------------------------------------- ------------- ------------- ------------
Options written, at value (premiums received--$905,188,
$834,065, and $221,184, respectively) 568,750 524,062 165,188
-------------------------------------------------------- ------------- ------------- ------------
Investment management fees payable 202,578 148,771 61,083
-------------------------------------------------------- ------------- ------------- ------------
Payable for variation margin on futures contracts 124,344 112,844 95,594
-------------------------------------------------------- ------------- ------------- ------------
Accrued expenses 138,478 106,904 58,529
-------------------------------------------------------- ------------- ------------- ------------
Total Liabilities 3,013,320 2,274,183 936,060
-------------------------------------------------------- ------------- ------------- ------------
PREFERRED SHARES ($25,000 NET ASSET AND LIQUIDATION
VALUE PER SHARE APPLICABLE TO AN AGGREGATE OF
8,000, 6,000 AND 2,520, SHARES ISSUED AND
OUTSTANDING, RESPECTIVELY) 200,000,000 150,000,000 63,000,000
-------------------------------------------------------- ------------- ------------- ------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS $ 335,070,711 $ 243,522,471 $ 98,679,280
-------------------------------------------------------- ------------- ------------- ------------
COMPOSITION OF NET ASSETS APPLICABLE TO
COMMON SHAREHOLDERS:
Common stock (no par value):
Paid-in capital $ 343,415,387 $ 252,748,809 $103,965,696
-------------------------------------------------------- ------------- ------------- ------------
Undistributed net investment income 6,716,573 3,425,463 850,922
-------------------------------------------------------- ------------- ------------- ------------
Accumulated net realized loss on investments (17,854,052) (16,846,887) (7,314,311)
-------------------------------------------------------- ------------- ------------- ------------
Net unrealized appreciation of investments, futures
contracts and options written 2,792,803 4,195,086 1,176,973
-------------------------------------------------------- ------------- ------------- ------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS $ 335,070,711 $ 243,522,471 $ 98,679,280
-------------------------------------------------------- ------------- ------------- ------------
Common Shares Outstanding 24,192,977 17,811,229 7,337,418
-------------------------------------------------------- ------------- ------------- ------------
NET ASSET VALUE PER COMMON SHARE $ 13.85 $ 13.67 $ 13.45
-------------------------------------------------------- ------------- ------------- ------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
20 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUNDS STATEMENTS OF OPERATIONS
For the six months ended October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
California New York
Municipal Municipal Municipal
------------ ------------ ------------
INTEREST INCOME:
Interest $ 15,795,369 $ 10,614,537 $ 4,221,647
--------------------------------------------------------- ------------ ------------ ------------
EXPENSES:
Investment management fees 1,745,538 1,291,771 524,069
--------------------------------------------------------- ------------ ------------ ------------
Auction agent fees and commissions 263,517 196,248 81,949
--------------------------------------------------------- ------------ ------------ ------------
Reports to shareholders 67,013 29,687 13,130
--------------------------------------------------------- ------------ ------------ ------------
Custodian and accounting agent fees 53,758 54,449 37,077
--------------------------------------------------------- ------------ ------------ ------------
Audit and tax services 31,983 34,136 23,192
--------------------------------------------------------- ------------ ------------ ------------
Investor relations 21,636 15,581 6,705
--------------------------------------------------------- ------------ ------------ ------------
New York Stock Exchange listing fees 17,990 17,868 1,170
--------------------------------------------------------- ------------ ------------ ------------
Transfer agent fees 16,105 15,288 14,783
--------------------------------------------------------- ------------ ------------ ------------
Trustees' fees and expenses 14,310 11,780 4,958
--------------------------------------------------------- ------------ ------------ ------------
Insurance expense 6,940 5,406 2,974
--------------------------------------------------------- ------------ ------------ ------------
Legal fees 2,250 4,700 3,956
--------------------------------------------------------- ------------ ------------ ------------
Miscellaneous 8,757 8,368 5,312
--------------------------------------------------------- ------------ ------------ ------------
Total expenses 2,249,797 1,685,282 719,275
--------------------------------------------------------- ------------ ------------ ------------
Less: investment management fees waived (537,089) (397,468) (161,252)
--------------------------------------------------------- ------------ ------------ ------------
custody credits earned on cash balances (513) (509) (609)
--------------------------------------------------------- ------------ ------------ ------------
Net expenses 1,712,195 1,287,305 557,414
--------------------------------------------------------- ------------ ------------ ------------
NET INVESTMENT INCOME 14,083,174 9,327,232 3,664,233
--------------------------------------------------------- ------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
---------------------------------------------------------
Investments 901,265 (2,070,599) (691,614)
--------------------------------------------------------- ------------- ------------- -------------
Futures contracts (2,842,964) (1,376,983) (1,245,274)
--------------------------------------------------------- ------------- ------------- -------------
Options written 1,204,401 605,952 541,790
--------------------------------------------------------- ------------- ------------- -------------
Net change in unrealized appreciation/depreciation of
investments, futures contracts and options written (5,030,149) (6,590,530) 973,216
--------------------------------------------------------- ------------- ------------- -------------
Net realized and unrealized loss on investments, futures
contracts and options written (5,767,447) (9,432,160) (421,882)
--------------------------------------------------------- ------------- ------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
INVESTMENT OPERATIONS 8,315,727 (104,928) 3,242,351
--------------------------------------------------------- ------------- ------------- -------------
DIVIDENDS ON PREFERRED SHARES FROM NET
INVESTMENT INCOME (854,895) (540,573) (239,743)
--------------------------------------------------------- ------------- ------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO
COMMON SHAREHOLDERS RESULTING FROM INVESTMENT
OPERATIONS $ 7,460,832 $ (645,501) $ 3,002,608
--------------------------------------------------------- ------------- ------------- -------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 21
PIMCO MUNICIPAL INCOME FUNDS STATEMENTS OF CHANGES IN NET ASSETS
APPLICABLE TO COMMON SHAREHOLDERS
--------------------------------------------------------------------------------
Municipal
------------------------------------
Six months ended
October 31, 2003 Year ended
(unaudited) April 30, 2003
------------------ ---------------
INVESTMENT OPERATIONS:
Net investment income $ 14,083,174 $ 28,236,360
-------------------------------------------------------------------- ------------- -------------
Net realized loss on investments, futures contracts and options
written (737,298) (17,116,754)
-------------------------------------------------------------------- ------------- -------------
Net change in unrealized appreciation/depreciation of investments,
futures contracts and options written (5,030,149) 11,056,671
-------------------------------------------------------------------- ------------- -------------
Net increase (decrease) in net assets resulting from investment
operations 8,315,727 22,176,277
-------------------------------------------------------------------- ------------- -------------
DIVIDENDS AND DISTRIBUTIONS ON PREFERRED SHARES FROM:
Net investment income (854,895) (2,299,781)
-------------------------------------------------------------------- ------------- -------------
Net realized gains -- (114,138)
-------------------------------------------------------------------- ------------- -------------
Total dividends and distributions on preferred shares (854,895) (2,413,919)
-------------------------------------------------------------------- ------------- -------------
Net increase (decrease) in net assets applicable to common
shareholders resulting from investment operations 7,460,832 19,762,358
-------------------------------------------------------------------- ------------- -------------
DIVIDENDS AND DISTRIBUTIONS TO COMMON SHAREHOLDERS FROM:
Net investment income (11,768,769) (23,364,852)
-------------------------------------------------------------------- ------------- -------------
Net realized gains -- (907,918)
-------------------------------------------------------------------- ------------- -------------
Total dividends and distributions to common shareholders (11,768,769) (24,272,770)
-------------------------------------------------------------------- ------------- -------------
CAPITAL SHARE TRANSACTIONS:
--------------------------------------------------------------------
Reinvestment of dividends and distributions 1,690,725 3,495,385
-------------------------------------------------------------------- ------------- -------------
Total increase (decrease) in net assets applicable to common
shareholders (2,617,212) (1,015,027)
-------------------------------------------------------------------- ------------- -------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS:
Beginning of period 337,687,923 338,702,950
-------------------------------------------------------------------- ------------- -------------
End of period (including undistributed net investment of $6,716,573
and $5,257,063, $3,425,463 and $2,860,275, and $850,922 and
$718,920, respectively) $ 335,070,711 $ 337,687,923
-------------------------------------------------------------------- ------------- -------------
COMMON SHARES ISSUED IN REINVESTMENT OF DIVIDENDS
AND DISTRIBUTIONS: 122,326 243,737
-------------------------------------------------------------------- ------------- -------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
22 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
California New York
Municipal Municipal
------------------------------------- ------------------------------------
Six months ended Six months ended
October 31, 2003 Year ended October 31, 2003 Year ended
(unaudited) April 30, 2003 (unaudited) April 30, 2003
------------------ ---------------- ------------------ ---------------
$ 9,327,232 $ 19,843,263 $ 3,664,233 $ 7,544,964
------------ ------------- ------------ ------------
(2,841,630) (13,895,334) (1,395,098) (5,953,984)
------------ ------------- ------------ ------------
(6,590,530) 15,066,673 973,216 2,557,403
------------ ------------- ------------ ------------
(104,928) 21,014,602 3,242,351 4,148,383
------------ ------------- ------------ ------------
(540,573) (1,716,314) (239,743) (718,510)
------------ ------------- ------------ ------------
-- -- -- --
------------ ------------- ------------ ------------
(540,573) (1,716,314) (239,743) (718,510)
------------ ------------- ------------ ------------
(645,501) 19,298,288 3,002,608 3,429,873
------------ ------------- ------------ ------------
(8,221,471) (16,367,945) (3,292,488) (6,536,786)
------------ ------------- ------------ ------------
-- -- -- --
------------ ------------- ------------ ------------
(8,221,471) (16,367,945) (3,292,488) (6,536,786)
------------ ------------- ------------ ------------
558,093 2,219,123 646,081 1,017,328
------------ ------------- ------------ ------------
(8,308,879) 5,149,466 356,201 (2,089,585)
------------ ------------- ------------ ------------
251,831,350 246,681,884 98,323,079 100,412,664
------------ ------------- ------------ ------------
$243,522.471 $ 251,831,350 $ 98,679,280 $ 98,323,079
------------ ------------- ------------ ------------
40,062 155,749 48,609 72,990
------------ ------------- ------------ ------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 23
PIMCO MUNICIPAL INCOME FUNDS NOTES TO FINANCIAL STATEMENTS
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
PIMCO Municipal Income Fund ("Municipal"), PIMCO California Municipal Income
Fund ("California Municipal") and PIMCO New York Municipal Income Fund ("New
York Municipal"), collectively referred to as the "Funds", were organized as
Massachusetts business trusts on May 10, 2001. Prior to commencing operations
on June 29, 2001, the Funds had no operations other than matters relating to
their organization and registration as non-diversified, closed-end management
investment companies registered under the Investment Company Act of 1940 and
the rules and regulations thereunder, as amended, and the sale and issuance of
6,667 shares of beneficial interest of each Fund at an aggregate purchase price
of $100,005 per Fund to Allianz Dresdner Asset Management of America L.P.,
("ADAM"). PIMCO Advisors Fund Management LLC (the "Investment Manager"), serves
as the Fund's Investment Manager and is an indirect, wholly-owned subsidiary of
ADAM. ADAM is an indirect majority-owned subsidiary of Allianz AG. The Funds
have an unlimited amount of no par value common stock authorized.
Municipal invests substantially all of its assets in a portfolio of municipal
bonds, the interest from which is exempt from federal income taxes. California
Municipal invests substantially all of its assets in municipal bonds which pay
interest that is exempt from federal and California state income taxes. New
York Municipal invests substantially all of its assets in municipal bonds which
pay interest that is exempt from federal, New York state and New York City
income taxes. The Funds will seek to avoid bonds generating interest income
which could potentially subject individuals to alternative minimum tax. The
issuers' abilities to meet their obligations may be affected by economic and
political developments in a specific state or region.
The preparation of the financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates.
In the normal course of business the Funds enter into contracts that contain a
variety of representations which provide general indemnifications. The Funds'
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against the Funds based upon events that have
not yet occurred. However, the Funds expect the risk of any loss to be remote.
The following is a summary of significant accounting policies followed by the
Funds:
(A) VALUATION OF INVESTMENTS
The Funds determine their net asset value at the close of regular trading
(normally 4:00 p.m. Eastern time) on the New York Stock Exchange ("NYSE") on
each day the NYSE is open. Debt securities are valued by an independent pricing
service approved by the Board of Trustees. Any security or other asset for
which market quotations are not readily available is valued as determined in
good faith under procedures established by the Board of Trustees. Short-term
investments having a remaining maturity of sixty days or less are valued at
amortized cost, which approximates market value.
(B) INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Realized gains and
losses on investments are determined on the identified cost basis. Interest
income is recorded on an accrual basis. Original issue discounts or premiums on
debt securities purchased are accreted or amortized daily to non-taxable
interest income. Market discount, if any, is accreted daily to taxable income.
(C) FEDERAL INCOME TAXES
The Funds intend to distribute all of their taxable income and to comply with
the other requirements of the U.S. Internal Revenue Code of 1986, as amended,
applicable to regulated investment companies. Accordingly, no provision for
U.S. federal income taxes is required. In addition, by distributing
substantially all of their taxable ordinary income and long-term capital gains,
if any, during each calendar year, the Funds intend not to be subject to U.S.
federal excise tax.
(D) DIVIDENDS AND DISTRIBUTIONS -- COMMON STOCK
The Funds declare dividends from net investment income monthly to common
shareholders. Distributions of net realized capital gains, if any, are paid at
least annually. Each Fund records dividends and distributions to its
shareholders on the ex-dividend date. The amount of dividends and distributions
from net investment income and net realized capital gains are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles. These "book-tax" differences are either
considered temporary or permanent in nature. To the extent these differences
are permanent in nature, such amounts are reclassified within
24 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUNDS NOTES TO FINANCIAL STATEMENTS
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
the capital accounts based on their federal income tax treatment; temporary
differences do not require reclassification. To the extent dividends and/or
distributions exceed current and accumulated earnings and profits for federal
income tax purposes, they are reported as dividends and/or distributions of
paid-in capital.
(E) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
financial instrument at a set price on a future date. Upon entering into such a
contract, the Funds are required to pledge to the broker an amount of cash or
securities equal to the minimum "initial margin" requirements of the exchange.
Pursuant to the contracts, the Funds agree to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in the value of the contracts.
Such receipts or payments are known as "variation margin" and are recorded by
the Funds as unrealized appreciation or depreciation. When the contracts are
closed, the Funds record a realized gain or loss equal to the difference
between the value of the contracts at the time they were opened and the value
at the time they were closed. Any unrealized appreciation or depreciation
recorded is simultaneously reversed. The use of futures transactions involve
the risk of an imperfect correlation in the movements in the price of futures
contracts, interest rates and the underlying hedged assets, and the possible
inability of counterparties to meet the terms of their contracts.
(F) OPTION TRANSACTIONS
For hedging purposes, the Funds may purchase and write (sell) put and call
options on municipal bonds, U.S. government securities, swap agreements,
indexes or futures contracts which are standardized and traded on a U.S. or
other exchange, boards of trade, or similar entity, or quoted on an automated
quotation system. The risk associated with purchasing an option is that the
Funds pay a premium whether or not the option is exercised. Additionally, the
Funds bear the risk of loss of premium and change in market value should the
counterparty not perform under the contract. Put and call options purchased are
accounted for in the same manner as portfolio securities.
The cost of securities acquired through the exercise of call options is
increased by the premiums paid. The proceeds from the securities sold through
the exercise of put options is decreased by the premiums paid.
When an option is written, the premium received is recorded as an asset with an
equal liability which is subsequently adjusted to the current market value of
the option written. Premiums received from writing options which expire
unexercised are recorded on the expiration date as a realized gain. The
difference between the premium received and the amount paid on effecting a
closing purchase transaction, including brokerage commissions, is also treated
as a realized gain, or if the premium is less than the amount paid for the
closing purchase transactions, as a realized loss. If a call option is
exercised, the premium is added to the proceeds from the sale of the underlying
security in determining whether there has been a realized gain or loss. If a
put option is exercised, the premium reduces the cost basis of the security. In
writing an option, the Funds bear the market risk of an unfavorable change in
the price of the security underlying the written option. Exercise of an option
written could result in the Funds purchasing a security at a price different
from the current market price.
(G) RESIDUAL INTEREST MUNICIPAL BONDS (RIBS)
The Funds invest in Residual Interest Municipal Bonds ("RIBS") whose interest
rates bear an inverse relationship to the interest rate on another security or
the value of an index, RIBS are created by dividing the income stream provided
by the underlying bonds to create two securities, one short-term and one
long-term. The interest rate on the short-term component is reset by an index
or auction process normally every seven to 35 days. After income is paid on the
short-term securities at current rates, the residual income from the underlying
bond(s) goes to the long-term securities. Therefore, rising short-term interest
rates result in lower income for the longer-term portion, and vice versa. The
longer-term bonds may be more volatile and less liquid than other Municipal
Bonds of comparable maturity. An investment in RIBS typically will involve
greater risk than an investment in a fixed rate bond.
(H) CUSTODY CREDITS ON CASH BALANCES
The Funds benefit from an expense offset arrangement with their custodian bank
whereby uninvested cash balances earn credits which reduce monthly custodian
and accounting agent expenses. Had these cash balances been invested in income
producing securities, they would have generated income for the Funds.
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 25
PIMCO MUNICIPAL INCOME FUNDS NOTES TO FINANCIAL STATEMENTS
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
2. INVESTMENT MANAGER AND SUB-ADVISER
Each Fund has entered into an Investment Management Agreement (the
"Agreements") with the Investment Manager to serve as Investment Manager to
each Fund. Subject to the supervision of each Fund's Board of Trustees, the
Investment Manager is responsible for managing, either directly or through
others selected by it, the investment activities of each Fund and the Fund's
business affairs and other administrative matters. Pursuant to the Agreements,
the Investment Manager receives an annual fee, payable monthly, at the annual
rate of 0.65% of each Fund's average daily net assets (including net assets
attributable to any preferred shares that may be outstanding). In order to
reduce Fund expenses, the Investment Manager has contractually agreed to
reimburse each Fund for fees and expenses at the annual rate of 0.20% of the
Fund's average daily net assets (including net assets attributable to any
preferred shares that may be outstanding) from the commencement of operations
through June 30, 2006, and for a declining amount thereafter through June 30,
2009.
The Investment Manager has retained its affiliate, Pacific Investment
Management Company LLC (the "Sub-Adviser"), to manage each Fund's investments.
Subject to the supervision of the Investment Manager, the Sub-Adviser makes all
investment decisions with respect to each Fund's assets. The Investment Manager
(not the Funds) pays a portion of the fees it receives to the Sub-Adviser in
return for its services, at the maximum annual rate of 0.37% of each Fund's
average daily net assets (including net assets attributable to any preferred
shares that may be outstanding). The Sub-Adviser has contractually agreed to
waive a portion of the fees it is entitled to receive from the Investment
Manager, such that the Sub-Adviser will receive 0.25% of each Fund's average
daily net assets (including net assets attributable to any preferred shares
that may be outstanding) from the commencement of the Funds' operations through
June 30, 2006, and will receive an increasing amount (not to exceed 0.37% of
each Fund's average daily net assets, including net assets attributable to any
preferred shares that may be outstanding) thereafter through June 30, 2009. The
Investment Manager informed the Funds that it paid the Sub-Adviser $671,361,
$496,835 and $201,565 in connection with sub-advisory services for Municipal,
California Municipal and New York Municipal, respectively, for the six months
ended October 31, 2003.
3. INVESTMENTS IN SECURITIES
(a) For the six months ended October 31, 2003, purchases and sales of
investments, other than short-term securities, were:
California New York
Municipal Municipal Municipal
-------------------------------------------------------------------------------
Purchases $26,940,778 $ 71,554,497 $37,125,401
Sales $35,748,215 $112,758,152 $30,762,100
(b) Futures contracts outstanding at October 31, 2003 were as follows:
# of Expiration Unrealized
Fund Type Contracts Date Depreciation
---------------------------------------------------------------------------------------------------------
Municipal Short: U.S. Treasury 30 Year Bond 173 12/19/03 $ (643,344)
=============
California Municipal Short: U.S. Treasury 30 Year Bond 157 12/19/03 $ (646,844)
=============
New York Municipal Short: U.S. Treasury 30 Year Bond 133 12/19/03 $ (500,593)
=============
26 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUNDS NOTES TO FINANCIAL STATEMENTS
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
3. INVESTMENTS IN SECURITIES (CONTINUED)
(c) Transactions in options written for the six months ended October 31, 2003
were:
Contracts Premiums
-----------------------------------------------------------------------------------
Municipal:
----------
Options outstanding, April 30, 2003 667 $ 521,190
Options written 3,191 2,564,363
Options expired (871) (549,184)
Option terminated in closing purchase transactions (1,685) (1,291,359)
Options exercised (602) (339,822)
-------- ------------
Options outstanding, October 31, 2003 700 $ 905,188
======== ============
California Municipal:
---------------------
Options outstanding, April 30, 2003 350 $ 267,012
Options written 2,316 1,970,222
Option expired (402) (326,763)
Options terminated in closing purchase transactions (1,215) (838,149)
Options exercised (404) (238,257)
-------- ------------
Options outstanding, October 31, 2003 645 $ 834,065
======== ============
New York Municipal:
-------------------
Options outstanding, April 30, 2003 169 $ 130,794
Options written 1,309 837,210
Options expired (567) (249,971)
Options terminated in closing purchase transactions (454) (378,222)
Options exercised (256) (118,627)
-------- ------------
Options outstanding, October 31, 2003 201 $ 221,184
======== ============
4. AUCTION PREFERRED SHARES
Municipal has issued 1,600 shares of Preferred Shares Series A, 1,600 shares of
Preferred Shares Series B, 1,600 shares of Preferred Shares Series C, 1,600
shares of Preferred Shares Series D and 1,600 shares of Preferred Shares Series
E, each with a net asset and liquidation value of $25,000 per share plus
accrued dividends.
California Municipal has issued 2,000 shares of Preferred Shares Series A,
2,000 shares of Preferred Shares Series B and 2,000 shares of Preferred Shares
Series C, each with a net asset and liquidation value of $25,000 per share plus
accrued dividends.
New York Municipal has issued 2,520 shares of Preferred Shares Series A with a
net asset and liquidation value of $25,000 per share plus accrued dividends.
Dividends are accumulated daily at an annual rate set through auction
procedures. Distributions of net realized capital gains, if any, are paid
annually.
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 27
PIMCO MUNICIPAL INCOME FUNDS NOTES TO FINANCIAL STATEMENTS
October 31, 2003 (unaudited)
--------------------------------------------------------------------------------
4. AUCTION PREFERRED SHARES (CONTINUED)
For the six months ended October 31, 2003, the annualized dividend rates ranged
from:
At October 31,
High Low 2003
------------------------------------------------------------
Municipal:
Series A 1.20% 0.65% 0.74%
Series B 1.20% 0.40% 0.85%
Series C 1.20% 0.70% 0.85%
Series D 1.20% 0.40% 0.85%
Series E 1.20% 0.487% 0.85%
California Municipal:
Series A 1.15% 0.40% 0.45%
Series B 1.05% 0.40% 0.80%
Series C 1.15% 0.40% 0.85%
New York Municipal:
Series A 1.00% 0.40% 0.75%
The Funds are subject to certain limitations and restrictions while Preferred
Shares are outstanding. Failure to comply with these limitations and
restrictions could preclude the Funds from declaring any dividends or
distributions to common shareholders or repurchasing common shares and/or could
trigger the mandatory redemption of Preferred Shares at their liquidation
value.
Preferred Shares, which are entitled to one vote per share, generally vote with
the common stock but vote separately as a class to elect two Trustees and on
any matters affecting the rights of the Preferred Shares.
5. SUBSEQUENT COMMON DIVIDEND DECLARATIONS
On November 3, 2003, the following dividends were declared to common
shareholders payable December 1, 2003 to shareholders of record on November 14,
2003:
Municipal $0.08125 per common share
California Municipal $0.077 per common share
New York Municipal $0.075 per common share
On December 1, 2003, the following dividends were declared to common
shareholders payable December 31, 2003 to shareholders of record on December
12, 2003:
Municipal $0.08125 per common share
California Municipal $0.077 per common share
New York Municipal $0.075 per common share
28 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUNDS FINANCIAL HIGHLIGHTS
For a share of common stock outstanding throughout each period:
--------------------------------------------------------------------------------
Municipal
---------------------------------------------------------
Six months For the period
ended Year June 29, 2001*
October 31, 2003 ended through
(unaudited) April 30, 2003 April 30, 2002
------------------ ---------------- -------------------
Net asset value, beginning of period $14.03 $14.22 $14.33**
--------------------------------------------------- ----------- -------- --------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.58 1.19 0.91
--------------------------------------------------- ----------- -------- --------------
Net realized and unrealized loss on investments,
futures contracts and options written (0.24) (0.26) (0.07)
--------------------------------------------------- ----------- -------- --------------
Total from investment operations 0.34 0.93 0.84
--------------------------------------------------- ----------- -------- --------------
DIVIDENDS AND DISTRIBUTIONS ON PREFERRED
SHARES FROM:
Net investment income (0.03) (0.10) (0.09)
--------------------------------------------------- ----------- -------- --------------
Net realized gains -- (0.00)+ (0.00)+
--------------------------------------------------- ----------- -------- --------------
Total dividends and distributions on preferred
shares (0.03) (0.10) (0.09)
--------------------------------------------------- ----------- -------- --------------
Net increase in net assets applicable to common
shares resulting from investment operations 0.31 0.83 0.75
--------------------------------------------------- ----------- -------- --------------
DIVIDENDS AND DISTRIBUTIONS TO COMMON
SHAREHOLDERS FROM:
Net investment income (0.49) (0.98) (0.71)
--------------------------------------------------- ----------- -------- --------------
Net realized gains -- (0.04) (0.02)
--------------------------------------------------- ----------- -------- --------------
Total dividends and distributions to common
shareholders (0.49) (1.02) (0.73)
--------------------------------------------------- ----------- -------- --------------
CAPITAL SHARE TRANSACTIONS:
Common stock offering costs charged to paid-in
capital -- -- (0.03)
--------------------------------------------------- ----------- -------- --------------
Preferred shares offering costs/underwriting
discounts charged to paid-in capital -- -- (0.10)
--------------------------------------------------- ----------- -------- --------------
Total capital share transactions -- -- (0.13)
--------------------------------------------------- ----------- -------- --------------
Net asset value, end of period $13.85 $14.03 $14.22
--------------------------------------------------- ----------- -------- --------------
Market price, end of period $13.73 $14.22 $14.70
--------------------------------------------------- ----------- -------- --------------
TOTAL INVESTMENT RETURN (1) 0.02% 3.79% 3.10%
--------------------------------------------------- ----------- -------- --------------
RATIOS/SUPPLEMENTAL DATA:
Net assets applicable to common shareholders,
end of period (000) $335,071 $337,688 $338,703
--------------------------------------------------- ----------- -------- --------------
Ratio of expenses to average net assets (2)(3)(5) 1.02%(4) 1.00% 0.91%(4)
--------------------------------------------------- ----------- -------- --------------
Ratio of net investment income to average net
assets (2)(5) 8.38%(4) 8.21% 7.64%(4)
--------------------------------------------------- ----------- -------- --------------
Preferred shares asset coverage per share $65,584 $67,206 $67,332
--------------------------------------------------- ----------- -------- --------------
Portfolio turnover 5% 27% 38%
--------------------------------------------------- ----------- -------- --------------
* Commencement of operations.
** Initial public offering price of $15.00 per share less underwriting
discount of $0.675 per share.
+ Less than $0.005 per share.
(1) Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day and a sale at the current
market price on the last day of each period reported. Dividends and
distributions are assumed, for purposes of this calculation, to be
reinvested at prices obtained under the Funds' dividend reinvestment
plan. Total investment return does not reflect brokerage commissions or
sales charges. Total investment return for a period of less than one year
is not annualized.
(2) Calculated on the basis of income and expenses applicable to both common
and preferred shares relative to the average net assets of common
shareholders.
(3) Inclusive of expenses offset by custody credits earned on cash balances
at custodian bank. (See note 1(h) in Notes to Financial Statements).
(4) Annualized.
(5) During the periods indicated above the Investment Manager waived a
portion of its investment management fee. If such waiver had not been in
effect, the ratio of expenses to average net assets and the ratio of net
investment income to average net assets would have been 1.34%
(annualized) and 8.06% (annualized), respectively, for the six months
ended October 31, 2003, 1.32% and 7.89%, respectively for the year ended
April 30, 2003 and 1.21% (annualized) and 7.34% (annualized),
respectively, for the period June 29, 2001 (commencement of operations)
through April 30, 2002.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 29
PIMCO MUNICIPAL INCOME FUNDS FINANCIAL HIGHLIGHTS
For a share of common stock outstanding throughout each period:
--------------------------------------------------------------------------------
California
Municipal
---------------------------------------------------------
Six months For the period
ended Year June 29, 2001*
October 31, 2003 ended through
(unaudited) April 30, 2003 April 30, 2002
------------------ ---------------- -------------------
Net asset value, beginning of period $14.17 $14.00 $14.33**
--------------------------------------------------- ----------- -------- --------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.52 1.12 0.83
--------------------------------------------------- ----------- -------- --------------
Net realized and unrealized gain (loss) on
investments, futures contracts and options
written (0.53) 0.07 (0.25)
--------------------------------------------------- ----------- -------- --------------
Total from investment operations (0.01) 1.19 0.58
--------------------------------------------------- ----------- -------- --------------
DIVIDENDS ON PREFERRED SHARES FROM NET
INVESTMENT INCOME (0.03) (0.10) (0.09)
--------------------------------------------------- ----------- -------- --------------
Net increase (decrease) in net assets applicable
to common shares resulting from investment
operations (0.04) 1.09 0.49
--------------------------------------------------- ----------- -------- --------------
DIVIDENDS TO COMMON SHAREHOLDERS FROM
NET INVESTMENT INCOME (0.46) (0.92) (0.68)
--------------------------------------------------- ----------- -------- --------------
CAPITAL SHARE TRANSACTIONS:
Common stock offering costs charged to paid-in
capital -- -- (0.03)
--------------------------------------------------- ----------- -------- --------------
Preferred shares offering costs/underwriting
discounts charges to paid-in capital -- -- (0.11)
--------------------------------------------------- ----------- -------- --------------
Total capital share transactions -- -- (0.14)
--------------------------------------------------- ----------- -------- --------------
Net asset value, end of period $13.67 $14.17 $14.00
--------------------------------------------------- ----------- -------- --------------
Market price, end of period $13.37 $14.15 $14.71
--------------------------------------------------- ----------- -------- --------------
TOTAL INVESTMENT RETURN (1) (2.27)% 2.64% 2.82%
--------------------------------------------------- ----------- -------- --------------
RATIOS/SUPPLEMENTAL DATA:
---------------------------------------------------
Net assets applicable to common shareholders,
end of period (000) $243,522 $251,831 $246,682
--------------------------------------------------- ----------- -------- --------------
Ratio of expenses to average net assets (2)(3)(5) 1.04%(4) 1.03% 0.94%(4)
--------------------------------------------------- ----------- -------- --------------
Ratio of net investment income to average net
assets (2)(5) 7.56%(4) 7.89% 7.03%(4)
--------------------------------------------------- ----------- -------- --------------
Preferred share asset coverage per share $65,963 $66,967 $66,109
--------------------------------------------------- ----------- -------- --------------
Portfolio turnover 19% 15% 45%
--------------------------------------------------- ----------- -------- --------------
* Commencement of operations.
** Initial public offering price of $15.00 per share less underwriting
discount of $0.675 per share.
(1) Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day and a sale at the current
market price on the last day of each period reported. Dividends are
assumed, for purposes of this calculation, to be reinvested at prices
obtained under the Funds' dividend reinvestment plan. Total investment
return does not reflect brokerage commissions or sales charges. Total
investment return for a period of less than one year is not annualized.
(2) Calculated on the basis of income and expenses applicable to both
common and preferred shares relative to the average net assets of common
shareholders.
(3) Inclusive of expenses offset by custody credits earned on cash balances
at custodian bank. (See note 1(h) in Notes to Financial Statements).
(4) Annualized.
(5) During the periods indicated above the Investment Manager waived a
portion of its investment management fee. If such waiver had not been in
effect, the ratio of expenses to average net assets and the ratio of net
investment income to average net assets would have been 1.37%
(annualized) and 7.24% (annualized), respectively for the six months
ended October 31, 2003, 1.34% and 7.58%, respectively for the year ended
April 30, 2003 and 1.24% (annualized) and 6.73% (annualized),
respectively, for the period June 29, 2001 (commencement of operations)
through April 30, 2002.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
30 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
PIMCO MUNICIPAL INCOME FUNDS FINANCIAL HIGHLIGHTS
For a share of common stock outstanding throughout each period:
--------------------------------------------------------------------------------
New York
Municipal
----------------------------------------------------------
Six months For the period
ended Year June 29, 2001*
October 31, 2003 ended through
(unaudited) April 30, 2003 April 30, 2002
------------------ ---------------- --------------------
Net asset value, beginning of period $13.49 $13.92 $14.33* *
------------------------------------------------------- ----------- ------- ---------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.50 1.04 0.82
------------------------------------------------------- ----------- ------- ---------------
Net realized and unrealized loss on
investments, futures contracts and options
written (0.06) (0.47) (0.26)
------------------------------------------------------- ----------- ------- ---------------
Total from investment operations 0.44 0.57 0.56
------------------------------------------------------- ----------- ------- ---------------
DIVIDENDS AND DISTRIBUTIONS ON PREFERRED
SHARES FROM:
Net investment income (0.03) (0.10) (0.09)
------------------------------------------------------- ----------- ------- ---------------
Net realized gains -- (0.01)
------------------------------------------------------- ----------- ------- ---------------
Total dividends and distributions on preferred
shares (0.03) (0.10) (0.10)
------------------------------------------------------- ----------- ------- ---------------
Net increase in net assets applicable to
common shares resulting from investment
operations 0.41 0.47 0.46
------------------------------------------------------- ----------- ------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO COMMON
SHAREHOLDERS FROM:
Net investment income (0.45) (0.90) (0.67)
------------------------------------------------------- ----------- ------- ---------------
Net realized gains -- -- (0.05)
------------------------------------------------------- ----------- ------- ---------------
Total dividends and distributions to common
shareholders (0.45) (0.90) (0.72)
------------------------------------------------------- ----------- ------- ---------------
CAPITAL SHARE TRANSACTIONS:
Common stock offering costs charged to
paid-in capital -- -- (0.03)
------------------------------------------------------- ----------- ------- ---------------
Preferred shares offering costs/underwriting
discounts charged to paid-in-capital -- -- (0.12)
------------------------------------------------------- ----------- ------- ---------------
Total capital share transactions -- -- (0.15)
------------------------------------------------------- ----------- ------- ---------------
Net asset value, end of period $13.45 $13.49 $13.92
------------------------------------------------------- ----------- ------- ---------------
Market price, end of period $13.50 $13.55 $14.20
------------------------------------------------------- ----------- ------- ---------------
TOTAL INVESTMENT RETURN (1) 3.05% 1.82% (0.34)%
------------------------------------------------------- ----------- ------- ---------------
RATIOS/SUPPLEMENTAL DATA:
Net assets applicable to common
shareholders, end of period (000) $98,679 $98,323 $100,413
------------------------------------------------------- ----------- ------- ---------------
Ratio of expenses to average net asset
(2)(3)(5) 1.14%(4) 1.13% 1.04%(4)
------------------------------------------------------- ----------- ------- ---------------
Ratio of net investment income to average net
assets (2)(5) 7.49%(4) 7.49% 7.07%(4)
------------------------------------------------------- ----------- ------- ---------------
Preferred shares asset coverage per share $64,156 $64,016 $64,834
------------------------------------------------------- ----------- ------- ---------------
Portfolio turnover 21% 23% 51%
------------------------------------------------------- ----------- ------- ---------------
* Commencement of operations.
** Initial public offering price of $15.00 per share less underwriting
discount of $0.675 per share.
(1) Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day and a sale at the current
market price on the last day of each period reported. Dividends and
distributions are assumed, for purposes of this calculation, to be
reinvested at prices obtained under the Funds' dividend reinvestment
plan. Total investment return does not reflect brokerage commissions or
sales charges. Total investment return for a period of less than one year
is not annualized.
(2) Calculated on the basis of income and expenses applicable to both common
and preferred shares relative to the average net assets of common
shareholders.
(3) Inclusive of expenses offset by custody credits earned on cash balances
at custodian bank. (See note 1(h) in Notes to Financial Statements).
(4) Annualized.
(5) During the periods indicated above the Investment Manager waived a
portion of its investment management fee. If such waiver had not been in
effect, the ratio of expenses to average net assets and the ratio of net
investment income to average net assets would have been 1.47%
(annualized) and 7.16% (annualized), respectively for the six-months
ended October 31, 2003, 1.45% and 7.14%, respectively for the six months
ended April 30, 2003, 1.34% (annualized) and 6.77% (annualized),
respectively for the period June 29, 2001 (commencement of operations)
through April 30, 2002.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
10.31.03 | PIMCO Municipal Income Funds Semi-Annual Report 31
PIMCO MUNICIPAL INCOME FUNDS ANNUAL SHAREHOLDER MEETING
--------------------------------------------------------------------------------
The Funds held its annual meeting of shareholders on September 16, 2003.
Common/Preferred shareholders voted to re-elect Robert E. Connor and Hans W.
Kertess as Class I Trustees to serve until 2006.
The resulting vote count is indicated below:
Withhold
Affirmative Authority
-----------------------------------------------------------------------------
Municipal:
----------
Election of Robert E. Connor 22,104,656 274,270
Election of Hans W. Kertess* 7,482 14
California Municipal:
---------------------
Election of Robert E. Connor 16,013,098 205,143
Election of Hans W. Kertess* 5,654 16
New York Municipal:
-------------------
Election of Robert E. Connor 6,496,079 66,349
Election of Hans W. Kertess* 2,512 --
Paul Belica, John J. Dalessandro II*, R. Peter Sullivan and Stephen Treadway
continue to serve as Trustees of the Funds.
----------------
* Preferred Stock Trustee
32 PIMCO Municipal Income Funds Semi-Annual Report | 10.31.03
TRUSTEES AND PRINCIPAL OFFICERS
Stephen Treadway
Trustee, Chairman, Chairman of the Board
Paul Belica
Trustee
Robert E. Connor
Trustee
John J. Dalessandro II
Trustee
Hans W. Kertess
Trustee
R. Peter Sullivan III
Trustee
Brian S. Shlissel
President & Chief Executive Officer
Newton B. Schott, Jr.
Vice President & Secretary
Mark V. McCray
Vice President
Lawrence G. Altadonna
Treasurer, Principal Financial & Accounting Officer
INVESTMENT MANAGER
PIMCO Advisors Fund Management LLC
1345 Avenue of the Americas
New York, NY 10105
SUB-ADVISER
Pacific Investment Management Company LLC
840 Newport Center Drive
Newport Beach, CA 92660
TRANSFER AGENT, DIVIDEND PAYING AGENT AND REGISTRAR
PFPC Inc.
P.O. Box 43027
Providence, RI 02940-3027
INDEPENDENT AUDITORS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
LEGAL COUNSEL
Ropes & Gray
One International Place
Boston, MA 02210-2624
This report, including the financial information herein, is transmitted to the
shareholders of PIMCO Municipal Income Fund, PIMCO California Municipal Income
Fund and PIMCO New York Municipal Income Fund for their information. It is not
a prospectus, circular or representation intended for use in the purchase of
shares of the Funds or any securities mentioned in this report.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that from time to time the Funds may purchase
shares of its common stock in the open market.
The financial information included herein is taken from the records of the
Funds without examination by independent auditors, who did not express an
opinion hereon.
Daily information on the Funds is available at www.pimcoadvisors.com or by
calling 1-800-331-1710.
P I M C O
---------------
A D V I S O R S
ITEM 2. CODE OF ETHICS Not required in this filing
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT Not required in this filing
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES Disclosure requirement not
currently effective
ITEM 5. [RESERVED]
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES Not applicable to this registrant
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES
(a) The registrant's President and Chief 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 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 or
in factors that could affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 10. EXHIBITS
(a) Exhibit 99.Cert. - Certification pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
(b) Exhibit 99.906 Cert. - Certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
Signature
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) PIMCO California Municipal Income Fund
--------------------------------------
By /s/ Brian S. Shlissel
------------------------
President and Chief Executive Officer
Date January 9, 2004
--------------------
By /s/ Lawrence G. Altadonna
----------------------------
Treasurer
Date January 9, 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/ Brian S. Shlissel
------------------------
President and Chief Executive Officer
Date January 9, 2004
--------------------
By /s/ Lawrence G. Altadonna
----------------------------
Treasurer
Date January 9, 2004
--------------------