<PAGE>
[LOGO] INVESTING
FOR THE
EATON VANCE
----------- 21ST
-----------
MUTUAL FUNDS CENTURY-Registered Trademark-
[PHOTO]-Globe
Semiannual Report February 28, 1999
EATON VANCE
INFORMATION
AGE FUND
[PHOTO]-Satelite Dish
GLOBAL MANAGEMENT--GLOBAL DISTRIBUTION
[PHOTO]-Baby at Computer
<PAGE>
Eaton Vance Information Age Fund as of February 28, 1999
INVESTMENT UPDATE
[PHOTO] - Duncan W. Richardson, Portfolio Manager
INVESTMENT ENVIRONMENT
- - Information age companies remained one of the fastest growing
segments of the global economy. To seek its objective of long-term
capital growth, Information Age Fund invests in a diversified global
portfolio of securities of companies that create, process, and
disseminate information.
- - There have been tremendous recoveries in the world markets from
the financial crises experienced last fall. This was particularly
evident in the Portfolio's U.S. technology stocks and Japanese
investments. We expect to see more of the last year's volatility in
the world markets and will attempt to use this volatility to benefit
our shareholders.
- - The pervasive trends of the Information Age - relentless
advances in technology, deregulation and privatization of
industries, and the global spread of capitalism - continued to drive
the performance of the securities in the Portfolio, despite
inevitable short-term setbacks in particular industry sectors or
geographical regions.
THE FUND
THE PAST SIX MONTHS
- - During the six months ended February 28, 1999, the Fund's Class A
shares had a total return of 27.2%. This return was the result of an
increase in net asset value (NAV)to $14.23 on February 28, 1999 from
$11.71 on August 31, 1998, and the reinvestment of $0.622 in capital
gains distributions. (1)
- - Class B shares had a total return of 26.9% during the period; the
result of an increase in NAV to $14.61 from $12.03, and the
reinvestment of $0.622 per share in capital gains distributions. (1)
- - Class C shares had a total return of 27.0% during the period, the
result of an increase in NAV to $14.22 from $11.72, and the
reinvestment of $0.622 per share in capital gains distributions. (1)
MANAGEMENT DISCUSSION
- - Management continued to focus on global telecom companies,
especially those that provide Internet and data transmission
services. With their large customer bases and strong balance sheets,
such companies offer attractive long-term growth prospects.
- - We believe that the recent economic recovery in Japan is real and
should continue. Accordingly, we have maintained the Portfolio's
exposure to Japanese stocks, especially those telecom companies
benefitting from improved domestic operations. Japan's international
technology companies could profit from an improvement in the
semiconductor cycle.
- - The Portfolio's largest holding is Pearson PLC, a British-based
global media conglomerate. This stock has continued to be attractive
because of its history of double-digit growth rates; preliminary
reports indicate record profit growth of 20% in 1998.
- - The Portfolio's largest U.S. holding, MediaOne Group, Inc.,
agreed in March to be acquired by another of the Portfolio's cable
holdings, Comcast Corp., in an all-stock transaction. We continued
to find U.S. cable stocks attractive due to the ongoing
consolidation in the industry and their ability to generate new
revenue streams from on-line services and telephony.
- - We believe that many newly issued Internet securities issues are
highly speculative and generally represent an unnecessary risk. We
currently hold only a few "pure" Internet issues, preferring to
invest in the scores of companies that are either benefitting from
the buildout of the Internet or whose businesses can be leveraged by
this revolutionary development.
- - For their risk-adjusted performance through February 28, 1999,
the Fund's B and C shares earned Five-Star Overall Morningstar
RatingsTM among 897 international equity funds* - a nationally
recognized monitor of mutual fund performance.
* Morningstar ratings reflect historical risk-adjusted performance
through 2/28/99 and are subject to change every month. Past
performance is no guarantee of future results. Funds are assigned
ratings from 1 star (lowest) to 5 stars (highest). Ratings are
calculated from the funds' 3-,5-, and 10-year average annual returns
(with fee adjustment) in excess of 90-day Treasury bill returns, and
a risk factor that reflects fund performance below 90-day Treasury
bill returns. The top 10% of the funds in a category receive 5
stars. For the 3-year period, the Fund's Class B and C shares were
rated 5 stars (897 funds). Rating is for Class B and C only; ratings
for other Class may vary. Morningstar ratings for Class B and C
shares have been lower over selected periods.
- -------------------------------------------------------------------------------
FUND INFORMATION
AS OF FEBRUARY 28, 1999
<TABLE>
<CAPTION>
Performance(2) Class A Class B Class C
- -------------------------------------------------------------
<S> <C> <C> <C>
Average Annual Total Returns (at net asset value)
- -------------------------------------------------------------
One Year 13.8% 13.5% 13.4%
Life of Fund+ 17.4 17.2 16.7
- -------------------------------------------------------------
SEC Average Annual Total Returns (including sales charge
or applicable CDSC)
- -------------------------------------------------------------
One Year 7.3% 8.5% 12.4%
Life of Fund+ 15.4 16.6 16.7
+ Inception Dates--Class A: 9/18/95; Class B: 9/18/95;
Class C: 11/22/95
- -------------------------------------------------------------
</TABLE>
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.
<TABLE>
<CAPTION>
TEN LARGEST HOLDINGS(3) BY TOTAL NET ASSETS
- -------------------------------------------------------------------------------
<S> <C>
Pearson PLC 3.4%
British Telecommunications PLC 3.2
Telecom Italia Spa 2.5
MediaOne Group, Inc. 2.2
SunGard Data Systems, Inc. 2.1
Valassis Communications, Inc. 2.0
Mediaset Spa 2.0
Xerox Corp. 2.0
Secom Co. Ltd. 2.0
Mirror Group PLC 1.9
</TABLE>
(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 Class B and Class C shares. (2) Returns are
historical and are calculated by determining the percentage change
in net asset value with all distributions reinvested. SEC returns
for Class A reflect the maximum 5.75% sales charge. SEC returns for
Class B 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. SEC 1-Year return for Class C reflects 1% CDSC. (3) Ten
largest equity holdings accounted for 23.3% of the Portfolio's net
assets. 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
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF FEBRUARY 28, 1999
<S> <C>
Assets
- ------------------------------------------------------
Investment in Information Age Portfolio,
at value
(identified cost, $43,827,393) $ 55,961,291
Receivable for Fund shares sold 135,624
Tax reclaim receivable 16,706
Deferred organization expenses 41,546
- ------------------------------------------------------
TOTAL ASSETS $ 56,155,167
- ------------------------------------------------------
Liabilities
- ------------------------------------------------------
Payable for Fund shares redeemed $ 131,843
Payable to affiliate for Trustees' fees 73
Other accrued expenses 30,112
- ------------------------------------------------------
TOTAL LIABILITIES $ 162,028
- ------------------------------------------------------
NET ASSETS $ 55,993,139
- ------------------------------------------------------
Sources of Net Assets
- ------------------------------------------------------
Paid-in capital $ 42,014,904
Accumulated undistributed net realized
gain on investments from Porfolio
(computed on the basis of identified
cost) 2,331,185
Accumulated net investment loss (486,848)
Net unrealized appreciation of
investments from Portfolio (computed
on the basis of identified cost) 12,133,898
- ------------------------------------------------------
TOTAL $ 55,993,139
- ------------------------------------------------------
Class A Shares
- ------------------------------------------------------
NET ASSETS $ 14,899,373
SHARES OUTSTANDING 1,046,867
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 14.23
MAXIMUM OFFERING PRICE PER SHARE
(100 DIVIDED BY 94.25 of $14.23) $ 15.10
- ------------------------------------------------------
Class B Shares
- ------------------------------------------------------
NET ASSETS $ 37,502,889
SHARES OUTSTANDING 2,566,649
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 14.61
- ------------------------------------------------------
Class C Shares
- ------------------------------------------------------
NET ASSETS $ 3,590,877
SHARES OUTSTANDING 252,552
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 14.22
- ------------------------------------------------------
</TABLE>
On sales of $50,000 or more, the offering price of Class A shares is reduced.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
FEBRUARY 28, 1999
<S> <C>
Investment Income
- ------------------------------------------------------
Dividends allocated from Portfolio
(net of foreign taxes, $5,624) $ 95,955
Interest allocated from Portfolio 92,030
Expenses allocated from Portfolio (355,126)
- ------------------------------------------------------
NET INVESTMENT LOSS FROM PORFOLIO $ (167,141)
- ------------------------------------------------------
Expenses
- ------------------------------------------------------
Management fee $ 63,048
Trustees fees and expenses 2,372
Distribution and service fees
Class A 33,347
Class B 149,317
Class C 14,913
Transfer and dividend disbursing agent
fees 14,406
Amortization of organization expenses 12,625
Legal and accounting services 11,984
Registration fees 6,139
Custodian fee 5,379
Printing and postage 3,935
Miscellaneous 2,242
- ------------------------------------------------------
TOTAL EXPENSES $ 319,707
- ------------------------------------------------------
NET INVESTMENT LOSS $ (486,848)
- ------------------------------------------------------
Realized and Unrealized Gain (Loss) from Portfolio
- ------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 2,273,467
Foreign currency transactions and
forward foreign currency exchange
contracts (25,623)
- ------------------------------------------------------
NET REALIZED GAIN $ 2,247,844
- ------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments $ 10,085,241
Foreign currency (9,732)
- ------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $ 10,075,509
- ------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $ 12,323,353
- ------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 11,836,505
- ------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS CONT'D
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
Increase (Decrease) FEBRUARY 28, 1999 YEAR ENDED
in Net Assets (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
From operations --
Net investment loss $ (486,848) $ (735,678)
Net realized gain 2,247,844 4,816,523
Net change in unrealized
appreciation (depreciation) 10,075,509 (3,475,675)
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 11,836,505 $ 605,170
- -------------------------------------------------------------------------------
Distributions to shareholders --
From net realized gain
Class A $ (623,931) $ (552,894)
Class B (1,503,429) (1,244,963)
Class C (131,635) (102,337)
- -------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS $ (2,258,995) $ (1,900,194)
- -------------------------------------------------------------------------------
Transactions in shares of beneficial interest --
Proceeds from sale of shares
Class A $ 1,061,706 $ 8,682,876
Class B 2,883,072 7,304,479
Class C 880,971 1,093,920
Issued in reorganization of EV
Traditional and Classic
Information Age Funds
Class A -- 12,492,459
Class C -- 2,147,859
Net asset value of shares issued to
shareholders in payment of
distributions declared
Class A 585,131 528,077
Class B 1,385,737 1,150,455
Class C 126,075 95,882
Cost of shares redeemed
Class A (1,624,173) (9,182,708)
Class B (3,487,749) (6,235,093)
Class C (519,157) (695,984)
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
FUND SHARE TRANSACTIONS $ 1,291,613 $ 17,382,222
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 10,869,123 $ 16,087,198
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 28, 1999 YEAR ENDED
Net Assets (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
At beginning of period $ 45,124,016 $ 29,036,818
- -------------------------------------------------------------------------------
AT END OF PERIOD $ 55,993,139 $ 45,124,016
- -------------------------------------------------------------------------------
Accumulated net
investment loss
included in net assets
- -------------------------------------------------------------------------------
AT END OF PERIOD $ (486,848) $ --
- -------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31,
SIX MONTHS ENDED ------------------------------------------------------------------
FEBRUARY 28, 1999
(UNAUDITED)(1) 1998 1997 1996(1)(2)
------------------------------------- ------------------------------------- --------- ----------
CLASS A CLASS B CLASS C CLASS A CLASS B CLASS C CLASS B CLASS B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value --
Beginning of
period $ 11.710 $ 12.030 $ 11.720 $ 11.970 $ 12.310 $ 12.020 $ 11.040 $ 10.000
- --------------------------------------------------------------------------------------------------------------------------------
Income (loss) from operations
- --------------------------------------------------------------------------------------------------------------------------------
Net investment
loss $ (0.108) $ (0.137) $ (0.159) $ (0.156) $ (0.210) $ (0.205) $ (0.178) $ (0.134)
Net realized and
unrealized gain 3.250 3.339 3.281 0.431 0.465 0.440 2.490 1.174
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL INCOME FROM
OPERATIONS $ 3.142 $ 3.202 $ 3.122 $ 0.275 $ 0.255 $ 0.235 $ 2.312 $ 1.040
- --------------------------------------------------------------------------------------------------------------------------------
Less distributions
- --------------------------------------------------------------------------------------------------------------------------------
From net realized
gain $ (0.622) $ (0.622) $ (0.622) $ (0.535) $ (0.535) $ (0.535) $ (1.042) $ --
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL
DISTRIBUTIONS $ (0.622) $ (0.622) $ (0.622) $ (0.535) $ (0.535) $ (0.535) $ (1.042) $ --
- --------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE --
END OF PERIOD $ 14.230 $ 14.610 $ 14.220 $ 11.710 $ 12.030 $ 11.720 $ 12.310 $ 11.040
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(3) 27.16% 26.93% 26.97% 2.32% 2.08% 1.96% 20.79% 10.40%
- --------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- --------------------------------------------------------------------------------------------------------------------------------
Net assets, end of
period (000's
omitted) $ 14,899 $ 37,503 $ 3,591 $ 12,263 $ 30,331 $ 2,531 $ 29,037 $ 21,800
Ratios (As a
percentage of
average daily
net assets):
Expenses(4) 2.40%(5) 2.80%(5) 2.88%(5) 2.68% 3.12% 3.20% 3.19% 2.96%(5)
Net investment
loss (1.65)%(5) (2.05)%(5) (2.13)%(5) (1.20)% (1.64)% (1.72)% (1.67)% (1.34)%(5)
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) For the period from the start of business, September 18, 1995, to August
31, 1996.
(3) 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
reinvested at the net asset value on the reinvestment date. Total return is
not computed on an annualized basis.
(4) Includes the Fund's share of the Portfolio's allocated expenses.
(5) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1 Significant Accounting Policies
- -------------------------------------------
Eaton Vance Information Age Fund (the Fund) is a diversified series of Eaton
Vance Growth Trust (the "Trust"). The Trust is an entity of the type commonly
known as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended, as an 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 the 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 Information Age
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
(83.3% at February 28, 1999). 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 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 Valuation -- 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 or loss 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, including registration costs, are being amortized on
the straight-line basis over five years.
E 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.
F Interim Financial Statements -- The interim financial statements relating to
February 28, 1999 and for the six months 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 gains (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 record date.
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 temporary 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.
6
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
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, 1999, the fee was equivalent to 0.25% (annualized) of the
Fund's average net assets for such period and amounted to $63,048. 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 directors/trustees of the above organizations. In addition, investment
adviser and administrative fees are paid by the Portfolio to EVM and its
affiliates. See Note 2 of the Portfolio's Notes to Financial Statements which
are included elsewhere in this report.
Eaton Vance Distributors, Inc. (EVD), a subsidiary of EVM and the Funds'
principal underwriter, received $2,528 from the Fund as its portion of the
sales charge on sales of Class A shares for the six months ended February 28,
1999.
4 Shares of Beneficial Interest
- -------------------------------------------
The 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 Fund
shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 28, 1999 YEAR ENDED
CLASS A (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
Sales 79,750 639,018
Issued to shareholders electing to
receive payment of distribution in Fund
shares 43,634 45,288
Redemptions (123,540) (681,009)
Issued to EV Traditional Information Age
shareholders -- 1,043,726
- -------------------------------------------------------------------------------
NET INCREASE (DECREASE) (156) 1,047,023
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 28, 1999 YEAR ENDED
CLASS B (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
Sales 206,982 534,973
Issued to shareholders electing to
receive payment of distribution in Fund
shares 100,635 95,519
Redemptions (261,705) (467,788)
- -------------------------------------------------------------------------------
NET INCREASE 45,912 162,704
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 28, 1999 YEAR ENDED
CLASS C (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
Sales 65,105 82,330
Issued to shareholders electing to
receive payment of distribution in Fund
shares 9,416 8,195
Redemptions (37,840) (53,285)
Issued to EV Classic Information Age
shareholders -- 178,631
- -------------------------------------------------------------------------------
NET INCREASE 36,681 215,871
- -------------------------------------------------------------------------------
</TABLE>
5 Distribution Plan
- -------------------------------------------
The Fund has adopted distribution plans (Class A Plan, Class B Plan, Class C
Plan, the Plans) pursuant to Rule 12b-1 under the Investment Company Act of
1940.
The Class A Plan provides for the payment of a monthly distribution fee to
the Principal Underwriter, Eaton Vance Distributors, Inc. (EVD), in an amount
equal to the aggregate of (a) 0.50% of that portion of the Fund's average
daily net assets attributable to Class A shares which have remained
outstanding for less than one year and (b) 0.25% of that portion of the
Fund's average daily net assets attributable to Class A shares which have
remained outstanding for more than one year.
The Class B and Class C Plans provides for the payment of a monthly
distribution fee to EVD at an annual rate not to exceed 0.75% of the Fund's
average daily net assets attributable to Class B and Class C shares for
providing ongoing distribution services and facilities to the Fund. The Fund
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) interest
calculated by applying the rate of 1% over the prevailing prime rate to the
7
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
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 Fund paid or accrued $20,067, $125,602, and $11,184 for Class A, Class B,
and Class C shares, respectively, to or payable to EVD for the six months
ended February 28, 1999, representing 0.30%, 0.75%, and 0.75% (annualized) of
the average daily net assets for Class A, Class B, and Class C shares,
respectively. At February 28, 1999, the amount of Uncovered Distribution
Charges EVD calculated under the Plans was approximately $894,000 and
$171,000 for Class B and Class C shares, respectively.
In addition, the Plans authorize the Fund to make payments of service fees to
EVD, Authorized Firms and other persons in amounts not exceeding 0.25% of the
Fund's average daily net assets attributable to Class A, Class B, and Class C
shares for each fiscal year. The Trustees have initially implemented the
Plans by authorizing the Fund to make quarterly payments of service fees to
EVD and Authorized Firms in amounts not expected to exceed 0.25% per annum of
the Fund's average daily net assets attributable to Class A, Class B, and
Class C shares based on the value of Fund 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,
1999 amounted to $13,280, $23,715, and $3,729 for Class A, Class B, and Class
C shares, respectively.
Certain officers and Trustees of the Fund are officers or directors of EVD.
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 Fund's Distribution Plan (see Note 5). CDSC charges received when
no Uncovered Distribution Charges exist will be credited to the Fund. EVD
received approximately $53,000 and $400 of CDSC paid by shareholders for
Class B shares and Class C shares, respectively, for the six months ended
February 28, 1999.
7 Investment Transactions
- -------------------------------------------
Increases and decreases in the Fund's investment in the Portfolio aggregated
$5,687,092 and $7,055,725, respectively, for the six months ended February
28, 1999.
8 Transfer of Net Assets
- -------------------------------------------
On September 1, 1997, EV Marathon Information Age Fund received the net
assets of the EV Traditional Information Age Fund and EV Classic Information
Age Fund pursuant to an Agreement and Plan of Reorganization dated June 23,
1997. In accordance with the agreement, EV Marathon Information Age Fund, at
the closing, issued 1,043,726 Class A shares and 178,631 Class C shares of
the Fund having an aggregate value of $12,492,459 and $2,147,859,
respectively. As a result the Fund issued one Class A share and one Class C
share for each share of EV Traditional Information Age Fund and EV Classic
Information Age Fund, respectively. The transaction was structured for tax
purposes to qualify as a tax free reorganization under the Internal Revenue
Code. The EV Traditional Information Age Fund's and EV Classic Information
Age Fund's net assets at the date of the transaction were $12,492,459 and
$2,147,859, respectively, including $1,702,572 and $241,938 of unrealized
appreciation. Directly after the merger, the combined net assets of the Eaton
Vance Information Age Fund (formerly "EV Marathon Information Age Fund") were
$43,677,136 with a net asset value of $11.97, $12.31 and $12.02 for Class A,
Class B and Class C, respectively.
9 Name Change
- -------------------------------------------
Effective September 1, 1997, the EV Marathon Information Age Fund changed its
name to Eaton Vance Information Age Fund.
8
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
PORTFOLIO OF INVESTMENTS (UNAUDITED)
(EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<S> <C> <C>
COMMON STOCKS -- 94.9%
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
- ------------------------------------------------------------------------
Advertising -- 2.7%
- ------------------------------------------------------------------------
Catalina Marketing Corp.(1) 10,000 $ 643,750
Omnicom Group, Inc. 16,000 1,060,000
Young and Rubicam, Inc.(1) 3,000 113,250
- ------------------------------------------------------------------------
$ 1,817,000
- ------------------------------------------------------------------------
Biotechnology -- 1.0%
- ------------------------------------------------------------------------
Transkaryotic Therapies, Inc.(1)(2) 22,000 $ 643,500
- ------------------------------------------------------------------------
$ 643,500
- ------------------------------------------------------------------------
Broadcasting and Cable -- 14.6%
- ------------------------------------------------------------------------
Cable and Wireless Communications(1)(2) 100,000 $ 1,179,505
CD Radio, Inc.(1) 30,000 652,500
Clear Channel Communications, Inc.(1) 10,000 600,000
Comcast Corp., Class A 11,000 780,313
Cox Communications, Inc., Class A(1) 11,000 778,250
Fox Entertainment Group, Inc.(1) 25,000 650,000
Infinity Broadasting Corp.(1) 10,000 237,500
Liberty Media Group, Class A(1) 2,000 107,750
MediaOne Group, Inc.(1) 27,000 1,471,500
Mediaset Spa(2) 140,000 1,325,263
Telewest Communications PLC(1)(2) 50,000 217,804
TV Francaise(2) 6,100 1,092,537
Univision Communications, Inc.(1) 17,000 692,750
- ------------------------------------------------------------------------
$ 9,785,672
- ------------------------------------------------------------------------
Business Services - Miscellaneous -- 2.7%
- ------------------------------------------------------------------------
Half (Robert) International, Inc.(1) 14,000 $ 504,000
Secom Co. Ltd.(2) 17,000 1,318,096
- ------------------------------------------------------------------------
$ 1,822,096
- ------------------------------------------------------------------------
Chemicals -- 1.2%
- ------------------------------------------------------------------------
Shin-Etsu Chemical Co.(2) 35,000 $ 819,127
- ------------------------------------------------------------------------
$ 819,127
- ------------------------------------------------------------------------
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
- ------------------------------------------------------------------------
Communications Equipment -- 1.2%
- ------------------------------------------------------------------------
Cisco Systems, Inc.(1) 4,000 $ 391,250
Qualcom, Inc.(1) 6,000 438,000
- ------------------------------------------------------------------------
$ 829,250
- ------------------------------------------------------------------------
Communications Services -- 21.9%
- ------------------------------------------------------------------------
3Com Corp.(1) 10,000 $ 314,375
Ameritech Corp. 7,000 457,625
BCE, Inc. 10,000 404,375
Bezeq(1)(2) 250,000 873,314
British Telecommunications PLC(2) 125,000 2,163,025
City Telecom (HK) Ltd.(2) 2,000,000 131,652
Energis(1)(2) 40,000 960,900
Estonian Telecom Ltd., GDR(1)(2) 10,100 214,625
GTE Corp. 15,000 973,125
Nippon Telegraph and Telephone
Corp.(1)(2) 130 1,070,337
NTT Mobile Communication Network,
Inc.(2) 200 811,550
Okinawa Cellular Telephone Co.(2) 100 715,579
Panafon Hellenic Registered S GDS(1)(2) 25,500 813,450
SBC Communications, Inc. 20,000 1,057,500
Sprint Corp. 14,000 1,201,375
Telecom Italia Spa(2) 250,000 1,696,547
Videsh Sanchar Nigam Ltd., GDR(1)(2) 40,000 383,000
Videsh Sanchar Nigam Ltd., GDR(2) 50,000 478,750
- ------------------------------------------------------------------------
$ 14,721,104
- ------------------------------------------------------------------------
Computer Software -- 5.9%
- ------------------------------------------------------------------------
BMC Software, Inc.(1) 10,000 $ 408,750
Computer Associates International, Inc. 13,000 546,000
Documentum, Inc.(1) 30,000 641,250
DST Systems, Inc.(1) 5,000 271,250
Misys PLC(2) 105,000 1,004,741
Network Associates, Inc.(1) 10,000 470,000
Oracle Corp.(2) 10,000 558,750
Seagull Holding NV(1)(2) 1,000 16,097
Sendit AB(1)(2) 3,600 70,355
- ------------------------------------------------------------------------
$ 3,987,193
- ------------------------------------------------------------------------
Computers and Business Equipment -- 5.2%
- ------------------------------------------------------------------------
EMC Corp.(1) 2,000 $ 204,750
Lexmark International Group, Inc.(1) 12,000 1,238,250
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
- ------------------------------------------------------------------------
<S> <C> <C>
Computers and Business Equipment (continued)
- ------------------------------------------------------------------------
NEC Corp.(2) 70,000 $ 705,981
Xerox Corp. 24,000 1,324,500
- ------------------------------------------------------------------------
$ 3,473,481
- ------------------------------------------------------------------------
Electrical Equipment -- 0.9%
- ------------------------------------------------------------------------
Hitachi Ltd.(2) 100,000 $ 631,393
- ------------------------------------------------------------------------
$ 631,393
- ------------------------------------------------------------------------
Electronics -- 2.7%
- ------------------------------------------------------------------------
C. Uyemura & Co. Ltd.(2) 20,000 $ 626,342
Nikon Corp.(2) 75,000 1,048,112
S.O.I.T.E.C.(2) 5,000 131,856
- ------------------------------------------------------------------------
$ 1,806,310
- ------------------------------------------------------------------------
Electronics - Instruments -- 3.0%
- ------------------------------------------------------------------------
Avimo Group Ltd.(2) 400,000 $ 571,196
Dae Duck Electronics, Co.(2) 99 7,121
Elec and Eltek International Holdings
Ltd.(2) 3,750,000 716,342
Toshiba Corp.(2) 110,000 681,568
- ------------------------------------------------------------------------
$ 1,976,227
- ------------------------------------------------------------------------
Electronics - Semiconductors -- 1.7%
- ------------------------------------------------------------------------
Analog Devices, Inc.(1) 25,000 $ 626,563
Samsung Electronics(1)(2) 1,458 102,721
Winbond Electronics Corp. GDR(1)(2) 32,000 433,600
- ------------------------------------------------------------------------
$ 1,162,884
- ------------------------------------------------------------------------
Entertainment -- 0.6%
- ------------------------------------------------------------------------
Time Warner, Inc. 6,000 $ 387,000
- ------------------------------------------------------------------------
$ 387,000
- ------------------------------------------------------------------------
Entertainment and Leisure -- 1.4%
- ------------------------------------------------------------------------
Mattel, Inc. 35,000 $ 923,125
- ------------------------------------------------------------------------
$ 923,125
- ------------------------------------------------------------------------
Information Services -- 8.8%
- ------------------------------------------------------------------------
Acxiom Corp.(1) 45,000 $ 1,077,188
Automatic Data Processing, Inc. 26,000 1,033,500
Azlan Group PLC(1)(2) 800,000 698,254
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
- ------------------------------------------------------------------------
Information Services (continued)
- ------------------------------------------------------------------------
Computer Sciences Corp. 10,000 $ 666,250
Forsoft Ltd.(1) 23,000 219,938
Gartner Group, Inc., Class A(1) 38,000 852,625
SunGard Data Systems, Inc.(1) 35,000 1,386,875
- ------------------------------------------------------------------------
$ 5,934,630
- ------------------------------------------------------------------------
Investment Services -- 0.4%
- ------------------------------------------------------------------------
E*Trade Group, Inc.(1) 2,000 $ 91,750
Schwab (Charles) and Co., Inc. 2,000 149,125
- ------------------------------------------------------------------------
$ 240,875
- ------------------------------------------------------------------------
Medical Products -- 1.0%
- ------------------------------------------------------------------------
Respironics, Inc.(1) 50,000 $ 640,625
- ------------------------------------------------------------------------
$ 640,625
- ------------------------------------------------------------------------
Miscellaneous -- 1.5%
- ------------------------------------------------------------------------
Sepracor, Inc.(1) 8,000 $ 998,000
- ------------------------------------------------------------------------
$ 998,000
- ------------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 0.8%
- ------------------------------------------------------------------------
Input/Output, Inc.(1) 100,000 $ 562,500
- ------------------------------------------------------------------------
$ 562,500
- ------------------------------------------------------------------------
Printing and Business Products -- 2.0%
- ------------------------------------------------------------------------
Valassis Communications, Inc.(1) 28,000 $ 1,344,000
- ------------------------------------------------------------------------
$ 1,344,000
- ------------------------------------------------------------------------
Publishing -- 11.4%
- ------------------------------------------------------------------------
Central Newspapers, Inc., Class A 10,000 $ 350,000
McGraw-Hill Companies, Inc. (The) 3,000 328,313
Mirror Group PLC(2) 400,000 1,242,764
New York Times Co. 15,000 465,000
News Corp. Ltd.(2) 150,636 1,054,505
Pearson PLC(2) 105,000 2,305,438
South China Morning Post (Holdings)
Ltd.(2) 1,500,000 643,739
Springer Alex Verlag AG(2) 1,128 1,239,446
- ------------------------------------------------------------------------
$ 7,629,205
- ------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
- ------------------------------------------------------------------------
<S> <C> <C>
Specialty Chemicals and Materials -- 0.6%
- ------------------------------------------------------------------------
Millipore Corp. 15,000 $ 418,125
- ------------------------------------------------------------------------
$ 418,125
- ------------------------------------------------------------------------
Telephone Utilities -- 1.7%
- ------------------------------------------------------------------------
Securicor PLC(2) 125,000 $ 1,168,094
- ------------------------------------------------------------------------
$ 1,168,094
- ------------------------------------------------------------------------
Total Common Stocks
(identified cost $49,248,687) $ 63,721,416
- ------------------------------------------------------------------------
MORTGAGE PASS-THROUGHS -- 5.7%
<CAPTION>
PRINCIPAL
AMOUNT
SECURITY (000 OMITTED) VALUE
<S> <C> <C>
- ------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 4.70%,
3/1/99 $ 3,808 $ 3,808,000
- ------------------------------------------------------------------------
Total Mortgage Pass-Throughs
(identified cost $3,808,000) $ 3,808,000
- ------------------------------------------------------------------------
Total Investments -- 100.6%
(identified cost $53,056,687) $ 67,529,416
- ------------------------------------------------------------------------
Other Assets, Less Liabilities -- (0.6)% $ (373,167)
- ------------------------------------------------------------------------
Net Assets -- 100% $ 67,156,249
- ------------------------------------------------------------------------
</TABLE>
ADR - American Depositary Receipt
GDR - Global Depositary Receipt
(1) Non-income producing security.
(2) Foreign security.
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF FEBRUARY 28, 1999
(EXPRESSED IN UNITED STATES DOLLARS)
<S> <C>
Assets
- ------------------------------------------------------
Investments, at value (identified cost,
$53,056,687) $ 67,529,416
Cash 1,839
Receivable for investments sold 892,078
Dividends and interest receivable 11,900
Deferred organization expenses 2,106
- ------------------------------------------------------
TOTAL ASSETS $ 68,437,339
- ------------------------------------------------------
Liabilities
- ------------------------------------------------------
Payable for investments purchased $ 1,250,464
Payable to affiliate for Trustees' fees 1,491
Other accrued expenses 29,135
- ------------------------------------------------------
TOTAL LIABILITIES $ 1,281,090
- ------------------------------------------------------
NET ASSETS APPLICABLE TO INVESTORS'
INTEREST IN PORTFOLIO $ 67,156,249
- ------------------------------------------------------
Sources of Net Assets
- ------------------------------------------------------
Net proceeds from capital contributions
and withdrawals $ 52,699,780
Net unrealized appreciation (computed on
the basis of identified cost) 14,456,469
- ------------------------------------------------------
TOTAL $ 67,156,249
- ------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
FEBRUARY 28, 1999
(EXPRESSED IN UNITED STATES DOLLARS)
<S> <C>
Investment Income
- ------------------------------------------------------
Dividends (net of foreign taxes, $6,686) $ 119,988
Interest 109,289
- ------------------------------------------------------
TOTAL INVESTMENT INCOME $ 229,277
- ------------------------------------------------------
Expenses
- ------------------------------------------------------
Investment adviser fee $ 225,056
Administration fee 74,938
Trustees fees and expenses 16,736
Custodian fee 91,486
Legal and accounting services 12,713
Amortization of organization expenses 609
Miscellaneous 630
- ------------------------------------------------------
TOTAL EXPENSES $ 422,168
- ------------------------------------------------------
NET INVESTMENT LOSS $ (192,891)
- ------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments
- ------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 2,714,865
Foreign currency transactions and
forward foreign currency exchange
contracts (30,318)
- ------------------------------------------------------
NET REALIZED GAIN $ 2,684,547
- ------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $ 11,954,972
Foreign currency (11,556)
- ------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $ 11,943,416
- ------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $ 14,627,963
- ------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 14,435,072
- ------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS CONT'D
STATEMENT OF CHANGES IN NET ASSETS
(EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
Increase (Decrease) FEBRUARY 28, 1999 YEAR ENDED
in Net Assets (UNAUDITED) AUGUST 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------
From operations --
Net investment income (loss) $ (192,891) $ 4,607
Net realized gain 2,684,547 5,870,256
Net change in unrealized appreciation
(depreciation) 11,943,416 (4,219,530)
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 14,435,072 $ 1,655,333
- -------------------------------------------------------------------------------
Capital transactions --
Contributions $ 7,750,585 $ 23,294,915
Withdrawals (8,585,755) (22,767,845)
- -------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL TRANSACTIONS $ (835,170) $ 527,070
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 13,599,902 $ 2,182,403
- -------------------------------------------------------------------------------
Net Assets
- -------------------------------------------------------------------------------
At beginning of period $ 53,556,347 $ 51,373,944
- -------------------------------------------------------------------------------
AT END OF PERIOD $ 67,156,249 $ 53,556,347
- -------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
FINANCIAL STATEMENTS CONT'D
SUPPLEMENTARY DATA (EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<CAPTION>
SIX
MONTHS
ENDED
FEBRUARY YEAR ENDED AUGUST 31,
28, 1999 -------------------------------------
(UNAUDITED) 1998 1997 1996(1)
<S> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------
Ratios to average daily net assets
- --------------------------------------------------------------------------------------------------
Expenses 1.42%(2) 1.44% 1.48% 1.52%(2)
Net investment income (loss) (0.65)%(2) 0.01% (0.04)% 0.07%(2)
Portfolio Turnover 55% 157% 160% 115%
- --------------------------------------------------------------------------------------------------
NET ASSETS, END OF PERIOD (000'S OMITTED) $ 67,156 $ 53,556 $ 51,374 $ 42,703
- --------------------------------------------------------------------------------------------------
</TABLE>
(1) For the period from the start of business, September 18, 1995, to August
31, 1996.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
(EXPRESSED IN UNITED STATES DOLLARS)
1 Significant Accounting Policies
- -------------------------------------------
Information Age Portfolio (the "Portfolio") is registered under the
Investment Company Act of 1940 as a diversified, open-end management
investment company. The Portfolio which was organized as a trust under the
laws of the State of New York on September 1, 1992 seeks to provide long-term
capital growth by investing in a global and diversified portfolio of
securities of information age companies. The Declaration of Trust permits the
Trustees to issue interests in the Portfolio. 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 -- Marketable securities, including options, that are
listed on foreign or U.S. securities exchanges or in the NASDAQ National
Market System are valued at closing sale prices, on the exchange where such
securities are principally traded. Futures positions on securities or
currencies are generally valued at closing settlement prices. Unlisted or
listed securities for which closing sale prices are not available are valued
at the mean between the latest bid and asked prices. Short-term debt
securities with a remaining maturity of 60 days or less are valued at
amortized cost. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.
Investments for which valuations or market quotations are unavailable are
valued at fair value using methods determined in good faith by or at the
direction of the Trustees.
B Federal Taxes -- The Portfolio is treated as a partnership for 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 on its share of such
income. 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 normally must satisfy the applicable source of
income and diversification requirements (under the Internal Revenue Code), in
order for its investors to satisfy them. The Portfolio will allocate, at
least annually among its investors, each investor's distributive share of the
Portfolio's net investment income, net realized capital gains, and any other
items of income, gain, loss, deduction or credit. Withholding taxes on
foreign dividends and capital gains have been provided for in accordance with
the Trust's understanding of the applicable countries' tax rules and rates.
C Deferred Organization Expenses -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line
basis over five years.
D Financial Futures Contracts -- Upon the entering of a financial futures
contract, the Portfolio is required to deposit ("initial margin") either in
cash or securities an amount equal to a certain percentage of the purchase
price indicated in the financial futures contract. Subsequent payments are
made or received by the Portfolio ("margin maintenance") each day, dependent
on the daily fluctuations in the value of the underlying security, and are
recorded for book purposes as unrealized gains or losses by the Portfolio.
The Portfolio's investment in financial futures contracts is designed only to
hedge against anticipated future changes in interest or currency exchange
rates. Should interest or currency exchange rates move unexpectedly, the
Portfolio may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss.
E Options on Financial Futures -- Upon the purchase of a put option on foreign
currency by the Portfolio, the premium paid is recorded as an investment, the
value of which is marked-to-market daily. When a purchased option expires,
the Portfolio will realize a loss in the amount of the cost of the option.
When a Portfolio enters into a closing sales transaction, the Portfolio will
realize a gain or loss depending upon whether the sales proceeds from the
closing sales transaction are greater or less than the cost of the option.
When a Portfolio exercises a put option, settlement is made in cash. The risk
associated with purchasing options is limited to the premium originally paid.
F 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
15
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
unrealized gains and losses on investments that result from fluctuations in
foreign currency exchange rates are not separately disclosed.
G 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 non-hedging purposes. The
forward foreign currency exchange contracts are adjusted by the daily
exchange rate of the underlying currency and any gains or losses are recorded
for financial statement purposes as unrealized until such time as the
contracts have been closed or offset.
H Use of Estimates -- The preparation of the 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.
I Other -- Investment transactions are accounted for on a trade date basis.
Dividend income is recorded on the ex-dividend date. However, if the
ex-dividend date has passed, certain dividends from foreign securities are
recorded as the Portfolio is informed of the ex-dividend date. Interest
income is recorded on the accrual basis.
J Interim Financial Statements -- The interim financial statements relating to
February 28, 1999 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 Adviser Fee and Other Transactions with Affiliates
- -------------------------------------------
The investment adviser fee is earned by Boston Management and Research (BMR),
a wholly-owned subsidiary of Eaton Vance Management (EVM), and Lloyd George
Investment Management (Bermuda) Limited, an affiliate of EVM (the Advisers),
as compensation for management and investment advisory services rendered to
the Portfolio. Under the advisory agreement, the Advisers receive a monthly
fee, divided equally between them, of 0.0625% (0.75% 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,
1999, the adviser fee was 0.75% (annualized) of average net assets for such
period and amounted to $225,056. In addition, an administrative fee is earned
by EVM for managing and administering the business affairs of the Portfolio.
Under the administration agreement, 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, 1999, the administration
fee was 0.25% (annualized) of average net assets for such period and amounted
to $74,938. Except as to the Trustees of the Portfolio who are not members of
the Advisers, or EVM's organization, officers and Trustees receive
remuneration for their services to the Portfolio out of such investment
adviser and administrative fees.
Trustees of the Portfolio that are not affiliated with the Advisers may elect
to defer receipt of all or a percentage of their annual fees in accordance
with the terms of the Trustees Deferred Compensation Plan. For the six months
ended February 28, 1999, no significant amounts have been deferred.
Certain of the officers and Trustees of the Portfolio are officers and
directors/trustees of the above organizations.
3 Investment Transactions
- -------------------------------------------
Purchases and sales of investments, other than short-term obligations and
purchased option transactions, aggregated $32,444,721 and $30,848,503,
respectively, for the six months ended February 28, 1999.
16
<PAGE>
INFORMATION AGE PORTFOLIO AS OF FEBRUARY 28, 1999
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
4 Federal Income Tax Basis of Investments
- -------------------------------------------
The cost and unrealized appreciation/depreciation in value of the investments
owned at February 28, 1999, are as follows:
<TABLE>
<S> <C>
AGGREGATE COST $ 53,056,687
- ------------------------------------------------------
Gross unrealized appreciation $ 16,693,034
Gross unrealized depreciation (2,220,305)
- ------------------------------------------------------
NET UNREALIZED APPRECIATION $ 14,472,729
- ------------------------------------------------------
</TABLE>
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 located in developing countries) may be less liquid and
more volatile than securities of comparable U.S. 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 Financial Instruments
- -------------------------------------------
The Portfolio regularly trades in financial instruments with off-balance
sheet risk in the normal course of its investing activities to assist in
managing exposure to various market risks. These financial instruments
include written options, forward foreign currency exchange contracts and
financial futures contracts and may involve, to a varying degree, elements of
risk in excess of the amounts recognized for financial statement purposes.
The notional or contractual amounts of these instruments represent the
investment the Portfolio has in particular classes of financial instruments
and does not necessarily represent the amounts potentially subject to risk.
The measurement of the risks associated with these instruments is meaningful
only when all related and offsetting transactions are considered.
At February 28, 1999, there were no outstanding obligations under these
financial instruments.
7 Line of Credit
- -------------------------------------------
The Portfolio participates with other portfolios and funds managed by BMR and
EVM and its affiliates in a $130 million unsecured line of credit agreement
with a group of banks. The Portfolio may temporarily borrow from the line of
credit to satisfy redemption requests or settle investment transactions.
Interest is charged to each portfolio or fund based on its borrowings at an
amount above either the Eurodollar rate or federal funds 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 funds and portfolios at the end
of each quarter. The Portfolio did not have any significant borrowings or
allocated fees during the six months ended February 28, 1999.
17
<PAGE>
EATON VANCE INFORMATION AGE FUND AS OF FEBRUARY 28, 1999
INVESTMENT MANAGEMENT
EATON VANCE INFORMATION AGE FUND
Officers
James B. Hawkes
President and Trustee
Thomas E. Faust, Jr.
Vice President
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Independent Trustees
Jessica M. Bibliowicz
President and Chief Executive Officer,
National Financial Partners
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment Banking,
Emeritus, Harvard University Graduate School of
Business Administration
Norton H. Reamer
Chairman and Chief Executive Officer,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
INFORMATION AGE PORTFOLIO
Officers
James B. Hawkes
President and Trustee
Duncan W. Richardson
Vice President and
Co-Portfolio Manager
Hon. Robert Lloyd George
Vice President, Trustee
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Independent Trustees
Hon. Edward K.Y. Chen
President of Lingnan College,
Hong Kong
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment Banking,
Emeritus, Harvard University Graduate School of
Business Administration
Norton H. Reamer
Chairman and Chief Executive Officer,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
18
<PAGE>
SPONSOR AND MANAGER OF EATON VANCE INFORMATION AGE
FUND AND ADMINISTRATOR OF INFORMATION AGE PORTFOLIO
Eaton Vance Management
24 Federal Street
Boston, MA 02110
CO-ADVISOR OF INFORMATION AGE PORTFOLIO
Boston Management and Research
24 Federal Street
Boston, MA 02110
Lloyd George Investment Management (Bermuda) Limited
3808 One Exchange Square
Central, Hong Kong
PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
CUSTODIAN
Investors Bank & Trust Company
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT
First Data Investor Services Group, Inc.
Attention: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
(800) 262-1122
EATON VANCE INFORMATION AGE FUND
24 FEDERAL STREET
BOSTON, MA 02110
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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.
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2-2143-4/99 IASRC-4/99
