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[LOGO OF EATON VANCE APPEARS HERE]
[PHOTO OF EARTH APPEARS HERE]
Semiannual Report February 28, 1998
[PHOTO OF OPERATING ROOM APPEARS HERE]
EATON VANCE
WORLDWIDE
HEALTH
SCIENCES FUND
Global Management-Global Distribution
[PHOTO OF DNA MOLECULAR STRUCTURE APPEARS HERE]
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
INVESTMENT UPDATE
[PHOTO OF SAMUEL D. ISALY APPEARS HERE]
Samuel D. Isaly,
Portfolio Manager
Investment Environment
- --------------------------------------------------------------------------------
The Drug and Biotech Sectors
. With the recent Asian economic downturn prompting downward earnings revisions
for the technology, basic materials, consumer durables, and energy sectors,
drug stocks have regained favor with investors in recent months. The sector
has been further boosted by renewed merger speculation.
. In November, President Clinton signed legislation that streamlines the FDA
approval process for new drugs. Reforms in the new law will reduce
bureaucratic delays in product development and improve access of seriously ill
patients to experimental drug treatments.
. Biotech stocks had a difficult year in 1997, punctuated by disappointing
clinical results and a heavy supply of initial public offerings. However, to
date in 1998, the biotech sector has mounted a strong recovery, as investors
have targeted companies with improved revenue growth and a stream of new
products.
The Fund
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Performance for the Past Six Months
. The Fund's Class A shares had a total return of 5.4% during the six months
ended February 28, 1998./1/ This return resulted from an increase in net
asset value per share (NAV) to $15.74 on February 28, 1998 from $14.93 on
August 31, 1997.
. The Fund's Class B shares had a total return of 5.1% during the six months
ended February 28, 1998./1/ This return resulted from an increase in NAV to
$12.28 on February 28, 1998 from $11.68 on August 31, 1997.
. The Fund's Class C shares had a total return of 6.4% during the period ended
February 28, 1998./1/ This return resulted from an increase in NAV to $10.64
on February 28, 1998 from $10.00 on January 5, 1998.
Management Discussion
. The Portfolio's largest holding at February 28 was Centocor, Inc. The
company's ReoPro drug is used to increase the size of blood vessels during
angioplasty surgery and is marketed through drug giant Eli Lilly. Centocor has
also developed in vitro diagnostics to test for breast and ovarian cancers.
The company registered sales growth in excess of 48% in 1997.
. Another large biotech holding, Agouron Pharmaceuticals, Inc., has created a
series of drugs called protease inhibitors, which have been deployed in the
fight against HIV. While these drugs do not kill the virus, they inhibit the
production of key enzymes, thus limiting the virus's ability to replicate.
. Among major North American holdings, Warner-Lambert has been a very strong
performer. In the crowded field of cholesterol-lowering agents, Warner's
Lipitor has achieved higher efficacy rates than its older competitors.
Lipitor alone is expected to achieve more than $1 billion in sales in 1998.
. Among large European drug companies, the Portfolio added Astra AB, a Swedish
pharmaceutical company. Astra has been especially successful with its
Pulmicort anti-asthma drug and its Turbohaler delivery system, as well as
Prilosec, a gastrointestinal treatment. Astra ranks among the top global
pharmaceutical companies and has increasingly become the subject of merger
speculation.
. The Portfolio recently added Human Genome Sciences, Inc., a smaller
Maryland-based biotech company. HGS performs genetic research used in creating
new biotech products. The company has filed several hundred patent
applications describing human genes and their potential applications. HGS has
established licensing arrangements with several large pharmaceutical
companies, including SmithKline Beecham.
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Mutual fund shares are not insured by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are subject
to investment risks, including possible loss of principal invested.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Fund Information
as of February 28, 1998
Performance/2/ Class A Class B Class C
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Average Annual Total Returns (at net asset value)
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One Year 10.7% 10.3% N.A.
Five Years 23.0 N.A. N.A.
Ten Years 18.8 N.A. N.A.
Life of Fund+ 17.1 15.5 6.4%
SEC Average Annual Total Returns (including sales charge or applicable CDSC)
- --------------------------------------------------------------------------------
One Year 4.4% 5.3% N.A.%
Five Years 21.6 N.A. N.A.
Ten Years 18.1 N.A. N.A.
Life of Fund+ 16.6 12.2 5.4%
+ Inception date: Class A: (7/26/85); Class B: (9/23/96); Class C: (1/5/98)
Ten Largest Holdings/3/ By total net assets
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Altana 4.9%
Novartis 4.1
Pharmacia & Upjohn, Inc. 4.1
Swiss Serum Institute 4.1
Sanofi SA 4.0
Genzyme Corp. 3.8
Centocor, Inc. 3.7
Agouron Pharmaceuticals, Inc. 3.6
Incyte Pharmaceuticals, Inc. 3.5
Vertex Pharmaceuticals, Inc. 3.5
/1/ These returns do not include the 5.75% maximum sales charge for the Fund's
Class A shares or the applicable contingent deferred sales charges (CDSC)
for the Fund's Class B and Class C shares. /2/ Returns are calculated by
determining the percentage change in net asset value (NAV) with all
distributions reinvested. SEC average annual returns for Class A reflect a
sales charge as noted; for Class B, returns reflect applicable CDSC based
on the following schedule: 5%-1st and 2nd years; 4%-3rd year; 3%-4th year;
2%-5th year; 1%-6th year; for Class C, returns reflect 1% CDSC. /3/ Based
on market value as of 2/28/98. Ten largest holdings represent 39.3% of the
Portfolio's investments. Holdings are subject to change.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost.
2
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Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
FINANCIAL STATEMENTS (Unaudited)
Statement of Assets and Liabilities
As of February 28, 1998
Assets
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Investment in Worldwide Health Sciences Portfolio,
at value (identified cost, $168,169,134) $193,861,078
Receivable for Fund shares sold 616,884
Other receivables 32,615
Deferred organization expenses (Note 1D) 30,114
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Total assets $194,540,691
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Liabilities
- --------------------------------------------------------------------------------
Payable for Fund shares redeemed $ 819,123
Payable to affiliate for Trustees' fees (Note 3) 548
Accrued expenses 88,024
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Total liabilities $ 907,695
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Net Assets $193,632,996
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Sources of Net Assets
- --------------------------------------------------------------------------------
Paid-in capital $163,710,676
Accumulated net realized gain on investments from
Portfolio (computed on basis of identified cost) 5,702,079
Accumulated net investment loss (1,471,703)
Net unrealized appreciation of investments from
Portfolio (computed on basis of identified cost) 25,691,944
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Total $193,632,996
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Class A Shares
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Net Assets $ 98,582,612
Shares Outstanding 6,262,620
Net Asset Value and Redemption Price Per Share
(Net assets/shares of beneficial interest
outstanding) $ 15.74
Offering Price Per Share
(100/94.25 of net asset value per share) $ 16.70
- --------------------------------------------------------------------------------
Class B Shares
- --------------------------------------------------------------------------------
Net Assets $ 94,014,552
Shares Outstanding 7,656,730
Net Asset Value, Offering Price and Redemption Price
Per Share (Note 6)
(Net assets/shares of beneficial interest outstanding) $ 12.28
- --------------------------------------------------------------------------------
Class C Shares
- --------------------------------------------------------------------------------
Net Assets $ 1,035,832
Shares Outstanding 97,333
Net Asset Value, Offering Price and Redemption Price
Per Share (Note 6)
(Net assets/shares of beneficial interest outstanding) $ 10.64
- --------------------------------------------------------------------------------
On sales of $50,000 or more, the offering price of Class A shares is reduced.
Statement of Operations
For the Six Months Ended
February 28, 1998
Investment Income (Note 1B)
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Dividend income allocated from Portfolio
(net of foreign taxes, $15,682) $ 201,703
Expenses allocated from Portfolio (809,034)
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Net investment loss from Portfolio $ (607,331)
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Expenses
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Management fee (Note 3) $ 219,099
Compensation of Trustees not members of the
Manager's organization (Note 3) 1,112
Custodian fee 106
Distribution and service fees (Note 5)
Class A 116,245
Class B 342,121
Class C 556
Transfer and dividend disbursing agent fees 125,837
Printing and postage 16,800
Legal and accounting services 9,550
Registration fees 28,978
Amortization of organization expenses (Note 1D) 3,968
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Total expenses $ 864,372
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Net investment loss $ (1,471,703)
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Realized and Unrealized
Gain (Loss) from Portfolio
- --------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 5,792,179
Foreign currency transactions (90,100)
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Net realized gain on investment transactions $ 5,702,079
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Change in unrealized appreciation (depreciation) --
Investments $ 3,688,690
Financial futures contracts 2,197
Foreign currency (2,553)
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Net change in unrealized appreciation (depreciation)
of investments $ 3,688,334
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Net realized and unrealized gain on investments $ 9,390,413
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Net increase in net assets from operations $ 7,918,710
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See notes to financial statements
3
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
Six Months Ended
Increase (Decrease) February 28, 1998 Year Ended
in Net Assets (Unaudited) August 31, 1997
- --------------------------------------------------------------------------------
From operations --
Net investment loss $ (1,471,703) $ (1,087,131)
Net realized gain on
investment transactions 5,702,079 1,797,036
Net change in unrealized
appreciation (depreciation)
of investments 3,688,334 9,599,183
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Net increase in net assets
from operations $ 7,918,710 $ 10,309,088
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Distributions to shareholders (Note 2)--
From net realized gain
Class A $ -- $ (4,230,217)
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Total distributions to shareholders $ -- $ (4,230,217)
- --------------------------------------------------------------------------------
Transactions in shares of beneficial interest
(Note 4)--
Proceeds from sale of shares
Class A $ 20,294,469 $ 50,014,627
Class B 31,537,283 --
Class C 1,018,219 --
Net asset value of shares issued
to shareholders in payment
of distributions declared
Class A -- 3,802,439
Cost of shares redeemed
Class A (14,773,204) (26,562,560)
Class B (5,375,547) --
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Net increase in net assets from
Fund share transactions $ 32,701,220 $ 27,254,506
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Contribution from EV Marathon
Worldwide Health Sciences Fund $ 64,663,847 $ --
- --------------------------------------------------------------------------------
Net increase in net assets $ 105,283,777 $ 33,333,377
- --------------------------------------------------------------------------------
Net Assets
- --------------------------------------------------------------------------------
At beginning of period $ 88,349,219 $ 55,015,842
- --------------------------------------------------------------------------------
At end of period $ 193,632,996 $ 88,349,219
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Accumulated
net investment loss
included in net assets
- --------------------------------------------------------------------------------
At end of period $ (1,471,703) $ --
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See notes to financial statements
4
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
FINANCIAL STATEMENTS CONT'D
Financial Highlights
<TABLE>
<CAPTION>
Six Months Ended
February 28, 1998
(Unaudited)
Class A Class B Class C*
- -------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value -- Beginning of period $ 14.930 $ 11.680 $ 10.000
- -------------------------------------------------------------------------------------
Income (loss) from operations
- -------------------------------------------------------------------------------------
Net investment loss $ (0.105) $ (0.106) $ (0.013)
Net realized and unrealized gain on
investments 0.915 0.706 0.653
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Total income from operations $ 0.810 $ 0.600 $ 0.640
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Less distributions
- -------------------------------------------------------------------------------------
From net realized gain on investments $ -- $ -- $ --
- -------------------------------------------------------------------------------------
Total distributions $ -- $ -- $ --
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Net asset value -- End of period $ 15.740 $ 12.280 $ 10.640
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Total Return (1) 5.42% 5.14% 6.40%
- -------------------------------------------------------------------------------------
Ratios/Supplemental Data+
- -------------------------------------------------------------------------------------
Net assets, end of period (000's omitted) $ 98,583 $ 94,015 $ 1,036
Ratio of net expenses to average net
assets (2) 1.84%+ 2.43%+ 2.45%+
Ratio of net expenses to average net
assets after custodian
fee reduction(2)(3) 1.63%+ 2.22%+ 2.24%+
Ratio of net investment loss to average
net assets (1.40)%+ (2.00)%+ (2.19)%+
Portfolio Turnover (4) -- -- --
- -------------------------------------------------------------------------------------
Average commission rate (5) $ -- $ -- $ --
- -------------------------------------------------------------------------------------
<CAPTION>
Year Ended August 31,
--------------------------------------------------------------
1997 1996 1995 1994 1993
--------------------------------------------------------------
Class A Class A Class A Class A Class A
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value -- Beginning of period $ 13.540 $ 11.710 $ 9.150 $ 9.640 $ 8.970
- -----------------------------------------------------------------------------------------------------------
Income (loss) from operations
- -----------------------------------------------------------------------------------------------------------
Net investment loss $ (0.133) $ (0.230) $ (0.170) $ (0.160) $ (0.130)
Net realized and unrealized gain on
investments 1.818 3.460 3.410 0.430 1.860
- -----------------------------------------------------------------------------------------------------------
Total income from operations $ 1.685 $ 3.230 $ 3.240 $ 0.270 $ 1.730
- -----------------------------------------------------------------------------------------------------------
Less distributions
- -----------------------------------------------------------------------------------------------------------
From net realized gain on investments $ (0.295) $ (1.400) $ (0.680) $ (0.760) $ (1.060)
- -----------------------------------------------------------------------------------------------------------
Total distributions $ (0.295) $ (1.400) $ (0.680) $ (0.760) $ (1.060)
- -----------------------------------------------------------------------------------------------------------
Net asset value -- End of period $ 14.930 $ 13.540 $ 11.710 $ 9.150 $ 9.640
- -----------------------------------------------------------------------------------------------------------
Total Return (1) 17.67% 31.04% 38.13% 2.69% 21.37%
- -----------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data+
- -----------------------------------------------------------------------------------------------------------
Net assets, end of period (000's omitted) $ 88,349 $ 55,016 $ 17,690 $ 13,231 $ 10,223
Ratio of net expenses to average net
assets (2) 2.07% 2.21% 2.44% 2.50% 2.50%
Ratio of net expenses to average net
assets after custodian
fee reduction(2)(3) 2.00% -- -- -- --
Ratio of net investment loss to average
net assets (1.60)% (1.81)% (1.80)% (1.65)% (1.53)%
Portfolio Turnover (4) -- 66% 45% 49% 77%
- -----------------------------------------------------------------------------------------------------------
Average commission rate (5) $ -- $ 0.0864 $ -- $ -- $ --
- -----------------------------------------------------------------------------------------------------------
+ The operating expenses of the Fund and the Portfolio may reflect a reduction
of the Investment Adviser fee, an allocation of expenses to the
Manager/Administrator, or both. Had such actions not been taken, the ratios
and net investment loss per share would have been as follows:
Ratios (As a percentage of average daily net assets):
Expenses (2) 2.29% -- -- 2.67% 2.87%
Expenses after custodian fee
reduction (2)(3) 2.22% -- -- -- --
Net investment loss (1.82)% -- -- (1.82)% (1.90)%
Net investment loss per share $ (0.151) -- -- -- --
- -----------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized.
* For the period from the start of business, January 5, 1998, to February 28,
1998.
(1) Total return is calculated assuming a purchase at the net asset value on the
first day and a sale at the net asset value on the last day of each period
reported. Dividends and distributions, if any, are assumed to be reinvested
at the net asset value on the ex-dividend date. Total return is not computed
on an annualized basis.
(2) Includes the Fund's share of its corresponding Portfolio's allocated
expenses subsequent to September 1, 1996.
(3) The expense ratios for the year ended August 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Fund, as well as its corresponding
Portfolio, to increase its expense ratio by the effect of any expense offset
arrangements with its service providers. The expense ratios for each of the
prior periods have not been adjusted to reflect this change.
(4) Portfolio Turnover represents the rate of portfolio activity for the period
while the Trust was making investments directly in securities. The portfolio
turnover rate for the period since the Trust transferred substantially all
of its investable assets to the Portfolio is shown in the Portfolio's
financial statements which are included elsewhere in this report.
(5) Average commission rate (per share of security) as required by amended
disclosure requirements effective September 1, 1995. Average commission rate
for the period since the Fund transferred substantially all of its
investable assets to the Portfolio is shown in the Portfolio's financial
statements which are included elsewhere in this report.
See notes to financial statements
5
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
----------------------------------------------------------------------------
Eaton Vance Worldwide Health Sciences Fund (the Fund) is a diversified,
open-end management investment company. The Fund offers three classes of
shares. Class A shares are sold subject to a sales charge imposed at the
time of purchase. Class B and Class C shares are sold at net asset value and
are subject to a contingent deferred sales charge (see Note 6). All classes
of shares have equal rights to assets and voting privileges. Realized and
unrealized gains and losses and net investment income, other than class
specific expenses, are allocated daily to each class of shares based on the
relative net assets of each class to the total net assets of the Fund. Each
class of shares differs in its distribution plan and certain other class
specific expenses. The Fund invests all of its investable assets in
interests in Worldwide Health Sciences Portfolio (the Portfolio), a New York
Trust, having the same investment objective as the Fund. The value of the
Fund's investment in the Portfolio reflects the Fund's proportionate
interest in the net assets of the Portfolio (99.9% at February 28, 1998).
The performance of the Fund is directly affected by the performance of the
Portfolio. The financial statements of the Portfolio, including the
portfolio of investments, are included elsewhere in this report and should
be read in conjunction with the Fund's financial statements.
The following is a summary of the significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted
accounting principles.
A Investment Valuations -- Valuation of securities by the Portfolio is
discussed in Note 1A of the Portfolio's Notes to Financial Statements which
are included elsewhere in this report.
B Income -- The Fund's net investment income consists of the Fund's pro rata
share of the net investment income of the Portfolio, less all actual and
accrued expenses of the Fund determined in accordance with generally
accepted accounting principles.
C Federal Taxes -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its net investment income, if
any, and any net realized capital gains. Accordingly, no provision for
federal income or excise tax is necessary.
D Deferred Organization Expenses -- Costs incurred by the Fund in connection
with its organization are being amortized on the straight-line basis over
five years.
E Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian to the Fund and the Portfolio. Pursuant to the respective
custodian agreements, IBT receives a fee reduced by credits which are
determined based on the average daily cash balances the Fund or the
Portfolio maintains with IBT. All significant credit balances used to reduce
the Fund's custodian fees are reported as a reduction of expenses on the
Statement of Operations.
F Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expense during the reporting period. Actual results could
differ from those estimates.
G Other -- Investment transactions are accounted for on a trade date basis.
H Interim Financial Statements -- The interim financial statements relating
to February 28, 1998 and for the six month period then ended have not been
audited by independent certified public accountants, but in the opinion of
the Fund's management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
2 Distributions to Shareholders
----------------------------------------------------------------------------
It is the present policy of the Fund to make at least one distribution
annually (normally in December) of all or substantially all of the
investment income allocated to the Fund by the Portfolio, less the Fund's
direct and allocated expenses and at least one distribution annually of all
or substantially all of the net realized capital gain (reduced by any
available capital loss carryforwards from prior years) allocated by the
Portfolio to the Fund, if any. Shareholders may reinvest all distributions
in shares of the Fund at the per share net asset value as of the close of
business on the ex-dividend date.
6
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
The Fund distinguishes between distributions on a tax basis and a financial
reporting basis. Generally accepted accounting principles require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a return of capital. Differences in the recognition
or classification of income between the financial statements and tax
earnings and profits which result in over distributions for financial
statement purposes are classified as distributions in excess of net
investment income or accumulated net realized gains. Permanent differences
between book and tax accounting relating to distributions are reclassified
to paid-in capital.
3 Management Fee and Other Transactions with Affiliates
----------------------------------------------------------------------------
The management fee is earned by Eaton Vance Management (EVM) as compensation
for management and administration of the business affairs of the Fund.
The fee is based on a percentage of average daily net assets. For the six
months ended February 28, 1998, the fee was equivalent to 0.25% (annualized)
of the Fund's average daily net assets for such period and amounted to
$219,099. EVM has agreed that through August 31, 1999, if the annual
aggregate expenses of the Class A shares (excluding extraordinary expenses)
exceed 2.00% of average daily net assets, then EVM will reduce its fees and
take other actions to the extent required to reduce the expenses. Except as
to Trustees of the Fund who are not members of EVM's organization, officers
and Trustees receive remuneration for their services to the Fund out of such
management fee. Certain officers and Trustees of the Fund and the Portfolio
are officers and Trustees of the above organizations. In addition,
administrative fees are paid by the Portfolio to EVM. See Note 2 of the
Portfolio's Notes to Financial Statements which are included elsewhere in
the report.
4 Shares of Beneficial Interest
----------------------------------------------------------------------------
The Fund's Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest (without par
value). Such shares may be issued in a number of different classes.
Transactions in shares of beneficial interest were as follows:
Six Months Ended
February 28, 1998 Year Ended
Class A (Unaudited) August 31, 1997
----------------------------------------------------------------------------
Shares sold 1,286,950 3,479,728
Shares issued
to shareholders
in reinvestment
of distributions -- 274,867
Shares redeemed (941,894) (1,900,964)
----------------------------------------------------------------------------
Net Increase 345,056 11,853,631
----------------------------------------------------------------------------
Six Months Ended
February 28, 1998
Class B (Unaudited)
----------------------------------------------------------------------------
Sales 2,577,101
Issued to shareholders electing to receive
payment of distribution in Fund shares --
Redemptions (456,763)
Issued to EV Marathon Worldwide Health Sciences
Fund Shareholders 5,536,392
----------------------------------------------------------------------------
Net increase 7,656,730
----------------------------------------------------------------------------
For the period
from January
9, 1998 to
February 28, 1998
Class C (Unaudited)
----------------------------------------------------------------------------
Sales 97,333
Issued to shareholders electing to receive
payment of distribution in Fund shares --
Redemptions --
----------------------------------------------------------------------------
Net increase 97,333
----------------------------------------------------------------------------
5 Distribution Plans
----------------------------------------------------------------------------
Each Class of the Fund has adopted a distribution plan (the Plans) pursuant
to Rule 12b-1 under the Investment Company Act of 1940. The Plans require
that the Class A shares will pay a monthly distribution fee to the Principal
Underwriter, Eaton Vance Distributors, Inc. (EVD), in an
7
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
amount equal to 0.25% on an annual basis of the average daily net assets
attributable to Class A shares. EVD may pay up to the entire amount of the
Class A distribution fee to Authorized Firms for providing personal services
to shareholders. For the six months ended February 28, 1998, the Class A
shares paid or accrued $116,245 to or payable to EVD. The Plans require the
Class B and Class C shares to pay EVD amounts equal to 1/365 of 0.75% of the
average daily net assets attributable to Class B and Class C shares for
providing ongoing distribution services and facilities to each class. Each
class will automatically discontinue payments to EVD during any period in
which there are no outstanding Uncovered Distribution Charges, which are
equivalent to the sum of (i) 5% and 6.25% of the aggregate amount received
by the Fund for the Class B and Class C shares sold, respectively, plus (ii)
distribution fees calculated by applying the rate of 1% over the prevailing
prime rate to the outstanding balance of Uncovered Distribution Charges of
EVD of each respective class reduced by the aggregate amount of contingent
deferred sales charges (see Note 6) and daily amounts theretofore paid to
EVD by each respective class. The Classes paid or accrued $301,871 and $419
for Class B and Class C shares, respectively, to or payable to EVD for the
six months ended February 28, 1998, representing 0.75% (annualized) of the
average daily net assets for Class B and Class C shares, respectively. At
February 28, 1998, the amount of Uncovered Distribution Charges of EVD
calculated under the Plans was approximately $4,011,000 and $63,600 for
Class B and Class C shares respectively.
In addition, the Plans authorize the Class B and Class C shares to make
payments of service fees to the Principal Underwriter, Authorized Firms and
other persons in amounts not exceeding 0.25% of the average daily net assets
attributable to Class B and Class C shares for each fiscal year. The
Trustees have initially implemented the Plans by authorizing each class to
make quarterly payments of service fees to the Principal Underwriter and
Authorized Firms in amounts not expected to exceed 0.25% per annum of the
average daily net assets attributable to Class B and Class C shares based on
the value of class shares sold by such persons and remaining outstanding for
at least one year. Service fee payments will be made for personal services
and/or the maintenance of shareholder accounts. Service fees are separate
and distinct from the sales commissions and distribution fees payable by the
Fund to EVD, and as such, are not subject to automatic discontinuance when
there are no outstanding Uncovered Distribution Charges of EVD. Service fee
payments for the six months ended February 28, 1998 amounted to $40,250 and
$137 for Class B and Class C shares, respectively.
6 Contingent Deferred Sales Charge
----------------------------------------------------------------------------
A contingent deferred sales charge (CDSC) is imposed on any redemption of
Class B shares made within six years of purchase. A CDSC is imposed on
certain Class C shares redeemed within one year of purchase. Generally, the
CDSC is based upon the lower of the net asset value at date of redemption or
date of purchase. No charge is levied on shares acquired by reinvestment of
dividends or capital gains distributions. Class B CDSC is imposed at
declining rates that begin at 5% in the case of redemptions in the first and
second year after purchase, declining one percentage point each subsequent
year. Class C shares will be subject to a 1% CDSC if redeemed within one
year of purchase. No CDSC is levied on shares which have been sold to EVM or
its affiliates or to their respective employees or clients. CDSC charges are
paid to EVD to reduce the amount of Uncovered Distribution Charges
calculated under each Class' Distribution Plan (see Note 5). CDSC charges
received when no Uncovered Distribution Charges exist will be credited to
the Fund. EVD received approximately $99,500 of CDSC paid by shareholders
for Class B shares for the six months ended February 28, 1998.
EVD did not receive any CDSC from shareholders for Class C shares.
7 Investment Transactions
----------------------------------------------------------------------------
Increases and decreases in the Fund's investment in the Portfolio for the
six months ended February 28, 1998 aggregated $52,722,895 and $20,243,877.
8 Transfer of Net Assets
----------------------------------------------------------------------------
On September 1, 1997, EV Traditional Worldwide Health Sciences Fund, Inc.
acquired the net assets of EV Marathon Worldwide Health Sciences Fund
pursuant to an Agreement and Plan of Reorganization dated June 23, 1997. In
accordance with the agreement, the Fund at the closing, issued 5,536,392
Class B shares with an aggregate value of $64,663,847 (including unrealized
appreciation of $3,351,226) and a net asset value per share of $11.68. The
transaction was structured for tax purposes to qualify as a tax free
reorganization under the Internal Revenue Code. Directly after the merger,
the combined net assets of the Fund were $153,013,066, with net asset values
of $14.93 and $11.68 for Class A shares and Class B shares, respectively.
8
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
9 Name Change
---------------------------------------------------------------------------
Effective September 1, 1997, EV Traditional Worldwide Health Sciences Fund,
Inc. changed its name to Eaton Vance Worldwide Health Sciences Fund.
9
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
PORTFOLIO OF INVESTMENTS (Unaudited)
(Expressed in United States Dollars)
Common Stocks and Warrants-- 96.80%
Percentage of
Security Shares Value Net Assets
- --------------------------------------------------------------------------------
Major Capitalization - Europe -- 18.79%
- --------------------------------------------------------------------------------
Altana 119,900 $ 9,584,332 4.94%
Ares-Serono 3,350 5,023,002 2.59%
Astra AB Class A 300,000 6,057,386 3.12%
Novartis 4,400 8,020,459 4.13%
Sanofi SA 68,700 7,791,356 4.01%
- --------------------------------------------------------------------------------
$ 36,476,535 18.79%
- --------------------------------------------------------------------------------
Major Capitalization - Far East -- 10.51%
- --------------------------------------------------------------------------------
Banyu Pharmaceutical Co. 307,000 $ 4,017,209 2.07%
Eisai Co., Ltd. 375,000 6,572,426 3.39%
Fujisawa Pharmaceutical 600,000 6,043,063 3.11%
Sankyo Co., Ltd. 140,000 3,763,829 1.94%
- --------------------------------------------------------------------------------
$ 20,396,527 10.51%
- --------------------------------------------------------------------------------
Major Capitalization - North America -- 24.63%
- --------------------------------------------------------------------------------
Biochem Pharma, Inc. 250,000 $ 5,609,375 2.89%
Biogen, Inc.* 150,000 6,618,750 3.41%
Centocor, Inc.* 200,000 7,212,500 3.72%
Genzyme Corp.* 250,000 7,390,625 3.81%
Immunex Corp.* 100,000 5,912,500 3.05%
Merck & Co., Inc. 25,000 3,189,063 1.64%
Pharmacia & Upjohn, Inc.* 200,000 7,912,499 4.08%
Warner-Lambert Co. 27,000 3,948,750 2.03%
- --------------------------------------------------------------------------------
$ 47,794,062 24.63%
- --------------------------------------------------------------------------------
Specialty Capitalization - Europe -- 6.83%
- --------------------------------------------------------------------------------
Cambridge Antibody
Technology, Ltd. 521,040 $ 3,348,625 1.73%
Cambridge Antibody
Technology, Ltd. - Warrants*/(a)/ 15,500 24,112 0.01%
Celltech Group, PLC* 375,000 1,853,888 0.95%
Ethical Holdings ADR* 150,000 150,000 0.08%
Swiss Serum Institute* 420 7,871,869 4.06%
- --------------------------------------------------------------------------------
$ 13,248,494 6.83%
- --------------------------------------------------------------------------------
Specialty Capitalization - Far East -- 6.36%
- --------------------------------------------------------------------------------
Amrad Corp., Ltd.* 1,110,658 $ 1,959,167 1.01%
Biota Holdings, Ltd.* 1,100,000 2,910,551 1.50%
Biota Holdings, Ltd. -
Warrants*/(a)/ 78,738 129,917 0.07%
Rohto Pharmaceutical 500,000 4,044,570 2.08%
Teikoku Hormone Manufacturing 550,000 3,293,152 1.70%
- --------------------------------------------------------------------------------
$ 12,337,357 6.36%
- --------------------------------------------------------------------------------
Specialty Capitalization - North America -- 29.68%
- --------------------------------------------------------------------------------
Agouron Pharmaceuticals, Inc.* 190,000 $ 7,006,250 3.61%
Alexion Pharmaceuticals, Inc.* 270,000 3,611,250 1.86%
Aviron* 125,000 3,140,625 1.62%
Axys Pharmaceuticals, Inc.* 250,000 2,125,000 1.09%
CytoTherapeutics, Inc.* 335,000 1,172,500 0.60%
Gilead Sciences, Inc.* 170,000 6,088,125 3.14%
Human Genome Sciences, Inc.* 100,000 4,250,000 2.19%
Incyte Pharmaceuticals, Inc.* 150,000 6,825,000 3.52%
Lynx Therapeutics, Inc.* 110,300 1,640,713 0.85%
Millennium Pharmaceuticals* 250,000 5,031,250 2.59%
Neurocrine BioScience, Inc. 130,000 1,072,500 0.55%
Pharmacopeia, Inc.* 175,000 3,325,000 1.71%
Premier Research Worldwide* 235,000 1,762,500 0.91%
SangStat Medical Corp.* 125,000 3,828,125 1.97%
Vertex Pharmaceuticals, Inc.* 180,000 6,727,500 3.47%
- --------------------------------------------------------------------------------
$ 57,606,338 29.68%
- --------------------------------------------------------------------------------
Total Common Stocks and Warrants
(identified cost $162,152,999) $187,859,313
- --------------------------------------------------------------------------------
See notes to financial statements
10
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
(Expressed in United States Dollars)
Preferred Stocks -- 3.76%
Percentage of
Security Shares Value Net Assets
- --------------------------------------------------------------------------------
Specialty Capitalization - North America -- 3.76%
- --------------------------------------------------------------------------------
Abgenix, Inc./(a)(b)/ 276,923 $ 1,800,000 0.93%
Ontogeny, Inc./(a)(b)/ 600,000 1,500,000 0.77%
Orchid Biocomputer, Inc./(a)(b)/ 180,180 1,999,998 1.03%
Tularik, Inc.*/(a)(b)/ 200,000 2,000,000 1.03%
- --------------------------------------------------------------------------------
$ 7,299,998 3.76%
- --------------------------------------------------------------------------------
Total Preferred Stocks
(identified cost $7,299,998) $ 7,299,998
- --------------------------------------------------------------------------------
Total Investments
(identified cost $169,452,997) $195,159,311 100.56%
- --------------------------------------------------------------------------------
Other Assets, Less Liabilities $ (1,091,255) (0.56)%
- --------------------------------------------------------------------------------
Net Assets $194,068,056 100.00%
- --------------------------------------------------------------------------------
* Non-income producing security.
/(a)/ Restricted Security (Note 7)
/(b)/ Security valued at fair value using methods determined in good faith by or
at the direction of the Trustees.
See notes to financial statements
11
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
FINANCIAL STATEMENTS (Unaudited)
Statement of Assets and Liabilities
As of February 28, 1998
(Expressed in United States Dollars)
Assets
- --------------------------------------------------------------------------------
Investments, at value (Note 1A)
(identified cost, $169,452,997) $195,159,311
Cash 243
Dividends receivable 12,960
Deferred organization expenses (Note 1E) 9,435
- --------------------------------------------------------------------------------
Total assets $195,181,949
- --------------------------------------------------------------------------------
Liabilities
- --------------------------------------------------------------------------------
Demand note payable (Note 6) $ 1,094,000
Payable to affiliate for Trustees' fees (Note 2) 1,122
Accrued expenses 18,771
- --------------------------------------------------------------------------------
Total liabilities $ 1,113,893
- --------------------------------------------------------------------------------
Net Assets applicable to investors' interest in
Portfolio $194,068,056
- --------------------------------------------------------------------------------
Sources of Net Assets
- --------------------------------------------------------------------------------
Net proceeds from capital contributions and
withdrawals $168,361,742
Net unrealized appreciation of investments (computed
on the basis of identified cost) 25,706,314
- --------------------------------------------------------------------------------
Total $194,068,056
- --------------------------------------------------------------------------------
Statement of Operations
For the Six Months Ended
February 28, 1998
(Expressed in United States Dollars)
Investment Income (Note 1B)
- --------------------------------------------------------------------------------
Dividends (net of foreign taxes, $15,694) $ 201,892
- --------------------------------------------------------------------------------
Total income $ 201,892
- --------------------------------------------------------------------------------
Expenses
- --------------------------------------------------------------------------------
Investment adviser fee (Note 2) $ 577,920
Administration fee (Note 2) 219,381
Compensation of Trustees not members of the
Administrator's organization (Note 2) 2,705
Custodian fee (Note 1D) 187,671
Legal and accounting services 4,908
Amortization of organization expenses (Note 1E) 1,206
Miscellaneous 1,995
- --------------------------------------------------------------------------------
Total expenses $ 995,786
- --------------------------------------------------------------------------------
Deduct --
Reduction of custodian fee (Note 1D) $ 185,896
- --------------------------------------------------------------------------------
Total expense reductions $ 185,896
- --------------------------------------------------------------------------------
Net expenses $ 809,890
- --------------------------------------------------------------------------------
Net investment loss $ (607,998)
- --------------------------------------------------------------------------------
Realized and Unrealized
Gain (Loss) on Investments
- --------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 5,798,459
Foreign currency transactions (90,194)
- --------------------------------------------------------------------------------
Net realized gain on investment transactions $ 5,708,265
- --------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 3,685,105
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)
of investments $ 3,685,105
- --------------------------------------------------------------------------------
Net realized and unrealized gain on investments $ 9,393,370
- --------------------------------------------------------------------------------
Net increase in net assets from operations $ 8,785,372
- --------------------------------------------------------------------------------
See notes to financial statements
12
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets (Expressed in United States Dollars)
Six Months Ended
Increase (Decrease) February 28, 1998 Year Ended
in Net Assets (Unaudited) August 31, 1997
- ------------------------------------------------------------------------
From operations --
Net investment loss $ (607,998) $ (756,950)
Net realized gain on
investment transactions 5,708,265 1,806,693
Net change in unrealized
appreciation (depreciation)
of investments 3,685,105 22,021,209
- ------------------------------------------------------------------------
Net increase in net assets
from operations $ 8,785,372 $ 23,070,952
- ------------------------------------------------------------------------
Capital transactions --
Contributions $ 52,816,274 $160,659,674
Withdrawals (20,250,578) (31,113,638)
- ------------------------------------------------------------------------
Net increase in net assets from
capital transactions $ 32,565,696 $129,546,036
- ------------------------------------------------------------------------
Net increase in net assets $ 41,351,068 $152,616,988
- ------------------------------------------------------------------------
Net Assets
- ------------------------------------------------------------------------
At beginning of period $152,716,988 $ 100,000
- ------------------------------------------------------------------------
At end of period $194,068,056 $152,716,988
- ------------------------------------------------------------------------
See notes to financial statements
13
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
FINANCIAL STATEMENTS CONT'D
Supplementary Data (Expressed in United States Dollars)
Six Months Ended
February 28, 1998 Year Ended
(Unaudited) August 31, 1997
- --------------------------------------------------------------------------------
Ratios to average daily net assets
- --------------------------------------------------------------------------------
Expenses 1.13%+ 1.25%
Expenses after custodian fee reduction 0.92%+ 1.18%
Net investment loss (0.69)%+ (0.81)%
Portfolio Turnover 9% 14%
- --------------------------------------------------------------------------------
Average commission rate (per share)(1) $ 0.0415 $ 0.0438
- --------------------------------------------------------------------------------
Net assets, end of period (000's omitted) $194,068 $152,717
- --------------------------------------------------------------------------------
+ Annualized.
(1) Average commission rate paid is computed by dividing the total dollar amount
of commissions paid during the fiscal year by the total number of shares
purchased and sold during the fiscal year for which commissions were
charged.
See notes to financial statements
14
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited)
(Expressed in United States Dollars)
1 Significant Accounting Policies
-----------------------------------------------------------------------------
Worldwide Health Sciences Portfolio (the Portfolio) is registered under the
Investment Company Act of 1940 as a diversified, open-end management
investment company which was organized as a trust under the laws of the
State of New York on March 26, 1996. The Declaration of Trust permits the
Trustees to issue interests in the Portfolio. Investment operations began on
September 1, 1996, with the acquisition of securities with a value of
$51,528,696, including unrealized appreciation of $9,053,201, in exchange
for interest in the Portfolio by one of the Portfolio's investors. The
following is a summary of the significant accounting policies of the
Portfolio. The policies are in conformity with generally accepted accounting
principles.
A Investment Valuations -- Securities listed on a recognized stock exchange,
whether U.S. or foreign, are valued at the last reported sale price on that
exchange prior to the time when assets are valued or prior to the close of
trading on the New York Stock exchange. In the event that there are no
sales, the last available sale price will be used. If a security is traded
on more than one exchange, the security is valued at the last sale price on
the exchange where the stock is primarily traded. Securities for which
market quotations are not readily available and other assets are valued on a
consistent basis at fair value as determined in good faith by or under the
supervision of the Portfolio's officers in a manner specifically authorized
by the Board of Trustees.
B Income -- Dividend income is recorded on the ex-dividend date, except that
certain dividends from foreign securities are recorded on the ex-dividend
date or as soon thereafter as the Portfolio is informed of the dividend.
C Federal Taxes -- The Portfolio has elected to be treated as a partnership
for United States Federal tax purposes. No provision is made by the
Portfolio for federal or state taxes on any taxable income of the Portfolio
because each investor in the Portfolio is ultimately responsible for the
payment of any taxes. Since some of the Portfolio's investors are regulated
investment companies that invest all or substantially all of their assets in
the Portfolio, the Portfolio must satisfy the applicable source of income
and diversification requirement, (under the Code) in order for its investors
to satisfy them. The Portfolio will allocate at least annually among its
investors each investors' distributive share of the Portfolio's net
investment income, net realized capital gains, and any other items of
income, gain, loss, deduction or credit.
D Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian of the Portfolio. Pursuant to the custodian agreement, IBT
receives a fee reduced by the credits which are determined based on the
average daily cash balances the Portfolio maintains with IBT. All
significant credit balances used to reduce the Portfolio's custodian fees
are reflected as a reduction of operating expense on the Statement of
Operations.
E Deferred Organization Expenses -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line
basis over five years.
F Use of Estimates -- The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expense during the
reporting period. Actual results could differ from those estimates.
G Foreign Currency Translation -- Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are converted each
business day into U.S. dollars based upon current exchange rates. Purchases
and sales of foreign investment securities and income and expenses are
converted into U.S. dollars based upon currency exchange rates prevailing on
the respective dates of such transactions. Recognized gains or losses on
investment transactions attributable to foreign currency rates are recorded
for financial statement purposes as net realized gains and losses on
investments. That portion of unrealized gains and losses on investments that
result from fluctuations in foreign currency exchange rates are not
separately disclosed.
H Forward Foreign Currency Exchange Contracts -- The Portfolio may enter
into forward foreign currency exchange contracts for the purchase or sale of
a specific foreign currency at a fixed price on a future date. Risks may
arise upon entering these contracts from the potential inability of
counterparties to meet the terms of their contracts and from movements in
the value of a foreign currency relative to the U.S. dollar. The Portfolio
will enter into forward contracts for hedging purposes as well as nonhedging
purposes. The forward foreign currency exchange contracts are adjusted by
the daily exchange rate of the underlying currency and any gains and losses
are recorded for financial statement purposes as unrealized until such time
as the contracts have been closed.
15
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
(Expressed in United States Dollars)
I Other -- Investment transactions are accounted for on a trade date
basis.
J Interim Financial Information -- The interim financial statements relating
to February 28, 1998 and for the six-month period then ended have not been
audited by independent certified public accountants, but in the opinion of the
Portfolio's management, reflect all adjustments, consisting only of normal
recurring adjustments necessary for the fair presentation of the financial
statements.
2 Investment Advisory Fees, Administrator's Fees and Other Transactions with
Affiliates
-----------------------------------------------------------------------------
Pursuant to the Advisory Agreement, OrbiMed Advisors, Inc. ("OrbiMed")
serves as the Investment Adviser of the Portfolio. Under this agreement
OrbiMed receives a monthly fee at the annual rate of 1% of the Portfolio
first $30 million in average net assets, 0.90% of the next $20 million in
average net assets, and 0.75% of average net assets in excess of $50
million. The fee rate declines for net assets of $500 million and greater.
In addition, effective September 1, 1997, OrbiMed's fee is subject to an
upward or downward performance fee adjustment of up to 0.25% (annualized) of
the average daily net assets of the Portfolio based upon the investment
performance of the Portfolio compared to the Standard & Poor's Index of 500
Common Stocks over specified periods. For the six months ended February 28,
1998, the fee was equivalent to 0.66% (annualized) of the Portfolio's
average daily net assets and amounted to $577,920.
Under an Administration Agreement between the Portfolio and its
Administrator, Eaton Vance Management (EVM), EVM manages and administers
the affairs of the Portfolio. EVM earns a monthly fee in the amount of
1/48th of 1% (equal to 0.25% annually) of the average daily net assets of
the Portfolio up to $500,000,000, and at reduced rates as daily net assets
exceed that level. For the six months ended February 28, 1998, the
administration fee was 0.25% (annualized) of average net assets.
Except as to Trustees of the Portfolio who are not members of the Adviser or
EVM's organization, officers and Trustees receive remuneration for their
services to the Portfolio out of such investment adviser and administrative
fees. Certain officers and Trustees of the Portfolio are also officers or
directors/trustees of the above organizations. Trustees of the Portfolio
that are not affiliated with the Investment
Adviser may elect to defer receipt of all or a portion of their annual fees
in accordance with the terms of the Trustee Deferred Compensation Plan. For
the six months ended February 28, 1998, no significant amounts have been
deferred.
3 Investments
-----------------------------------------------------------------------------
Purchases and sales of investments other than U.S. Government securities and
short-term obligations aggregated $57,946,664 and $15,851,514, respectively
for the six months ended February 28, 1998.
4 Federal Income Tax Basis of Investments
-----------------------------------------------------------------------------
The cost and unrealized appreciation/depreciation in value of the
investments owned at February 28, 1998, as computed on a federal income tax
basis, were as follows:
Aggregate cost $169,452,997
---------------------------------------------------------------------------
Gross unrealized appreciation $35,272,488
Gross unrealized depreciation (9,566,174)
---------------------------------------------------------------------------
Net unrealized appreciation $25,706,314
---------------------------------------------------------------------------
5 Risks Associated with Foreign Investments
-----------------------------------------------------------------------------
Investing in securities issued by companies whose principal business
activities are outside the United States may involve significant risks not
present in domestic investments. For example, there is generally less
publicly available information about foreign companies, particularly those
not subject to the disclosure and reporting requirements of the U.S.
securities laws. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and standards of
practice comparable to those applicable to domestic issuers. Investments in
foreign securities also involve the risk of possible adverse changes in
investment or exchange control regulations, expropriation or confiscatory
taxation, limitation on the removal of funds or other assets of the
Portfolio, political or financial instability or diplomatic and other
developments which could affect such investments. Foreign stock markets,
while growing in volume and sophistication, are generally not as developed
as those in the United States, and securities of some foreign issuers
(particularly those in developing countries) may be less liquid and more
volatile than securities of comparable U.S.
16
<PAGE>
Worldwide Health Sciences Portfolio as of February 28, 1998
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
(Expressed in United States Dollars)
companies. In general, there is less overall governmental supervision and
regulation of foreign securities markets, broker-dealers, and issuers than
in the United States.
6 Line of Credit
-----------------------------------------------------------------------------
The Portfolio participates with other portfolios and funds managed by EVM
and its affiliates in a committed $100 million unsecured line of credit
agreement with a group of banks. Borrowings will be made by the Portfolios
and funds solely to facilitate the handling of unusual and/or unanticipated
short-term cash requirements. Interest is charged to each portfolio or fund
based on its borrowings at an amount above the Eurodollar rate or federal
funds effective rate. In addition, a fee computed at an annual rate of 0.10%
on the daily unused portion of the facility is allocated among the
participating portfolios and funds at the end of each quarter. At February
28, 1998, the Portfolio had a balance outstanding pursuant to this line of
credit of $1,094,000. The Portfolio did not have any significant borrowings
or allocated fees during the six months ended February 28, 1998.
7 Restricted Securities
-----------------------------------------------------------------------------
At February 28, 1998, the Portfolio owned the following securities
(representing 3.84% of net assets) which were restricted as to public resale
and not registered under the Securities Act of 1933. The Fund has various
registration rights (exercisable under a variety of circumstances) with
respect to these securities. The fair value of these securities is
determined based on valuations provided by brokers when available, or if not
available, they are valued at fair value using methods determined in good
faith by or at the direction of the Trustees.
Date of
Description Acquisition Shares Cost Fair Value
----------------------------------------------------------------------------
Preferred Stocks
----------------------------------------------------------------------------
Abgenix 12/18/97 276,923 $1,800,000 $1,800,000
Ontogeny, Inc. 3/13/97 600,000 1,500,000 1,500,000
Orchid Biocomputer 12/19/97 180,180 1,999,998 1,999,998
Tularik, Inc. 10/14/96 200,000 2,000,000 2,000,000
----------------------------------------------------------------------------
$7,299,998 $7,299,998
----------------------------------------------------------------------------
Warrants
----------------------------------------------------------------------------
Cambridge Antibody 08/28/96 15,500 $31,000 $24,112
Technology
Biota Holding 12/18/95 78,738 0 129,917
----------------------------------------------------------------------------
$31,000 $154,029
----------------------------------------------------------------------------
17
<PAGE>
Eaton Vance Worldwide Health Sciences Fund as of February 28, 1998
INVESTMENT MANAGEMENT
Eaton Vance Worldwide Health Sciences Fund
Officers
James B. Hawkes
President and Trustee
M. Dozier Gardner
Vice President
William D. Burt
Vice President
Barclay Tittman
Vice President
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Independent Trustees
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking, Harvard University Graduate School of
Business Administration
Norton H. Reamer
President and Director, United Asset
Management Corporation
John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
Worldwide Health Sciences Portfolio
Officers
James B. Hawkes
President and Trustee
Samuel D. Isaly
Vice President and
Portfolio Manager
Raymond O'Neill
Vice President
Michel Normandeau
Vice President
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Independent Trustees
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking, Harvard University Graduate School of
Business Administration
Norton H. Reamer
President and Director, United Asset
Management Corporation
John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
18
<PAGE>
This Page Intentionally Left Blank
19
<PAGE>
Sponsor and Manager of Eaton Vance Worldwide
Health Sciences Fund & Administrator of
Worldwide Health Sciences Portfolio
Eaton Vance Management
24 Federal Street
Boston, MA 02110
Advisor of Worldwide Health Sciences Portfolio
OrbiMed Advisors, Inc.
41 Madison Avenue
New York, NY 10010-2202
Principal Underwriter
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
200 Clarendon Street, 16th Floor
Boston, MA 02116
Transfer Agent
First Data Invesor Services Group
Attn: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
(800) 262-1122
Eaton Vance Worldwide Health Sciences Fund
24 Federal Street
Boston, MA 02110
- --------------------------------------------------------------------------------
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its sales charges
and expenses. Please read the prospectus carefully before you invest or send
money.
- --------------------------------------------------------------------------------
