<PAGE>
[EATON VANCE LOGO]
[PICTURE OF MOON]
Semiannual Report February 29, 2000
PICTURE OF EATON VANCE
DOCTORS
WORLDWIDE
HEALTH
SCIENCES FUND
[EATON VANCE 75TH ANNIVERSARY LOGO]
[PICTURE OF DOCTORS]
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
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INVESTMENT UPDATE
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[PHOTO]
Samuel D. Isaly
Portfolio Manger
INVESTMENT ENVIRONMENT
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- - Health sciences stocks performed well during the six months ended February
29, 2000. The biotech sector, in particular, was characterized by
astonishing growth, as investors realized that an increasing number of
biotech firms are starting to turn a profit. Recent figures indicate that
at $600 billion, the industry's market capitalization has tripled since the
end of 1998.
- - While a price correction has taken place in biotech stocks in March of
2000, we believe the sector's strong performance will continue over the
long-term, driven by a growing number of profitable companies, ongoing
FDA approval of new products, and merger activity. In addition, the
sequencing of the human genome will significantly change the process of
drug discovery.
THE FUND
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The Past Six Months
- - During the six months ended February 29, 2000, the Fund's Class A shares
had a total return of 64.91%. This return was the result of an increase in
net asset value (NAV) to $28.18 on February 29, 2000 from $18.49 on August
31, 1999, and the reinvestment of $1.423 per share in capital gains
distributions. (1)
- - The Fund's Class B shares had a total return of 64.28% during the period,
the result of an increase in NAV to $20.89 from $14.12, and the
reinvestment of $1.423 per share in capital gains distributions. (1)
- - The Fund's Class C shares had a total return of 64.28% during the period,
the result of an increase in NAV to $17.62 from $12.13, and the
reinvestment of $1.423 per share in capital gains distributions. (1)
Management Discussion
- - The Portfolio's outstanding performance benefited from a long-term,
diversified style. Management aims to balance new companies with old;
high-risk ventures with low-risk; biotechnology enterprises with large
pharmaceutical businesses. Furthermore, our research team analyzes the
worldwide health sciences industry in search of compelling investment
opportunities. This balanced approach can help reduce the impact on
performance of a highly volatile sector.
- - A significant biotech holding in the Portfolio is Gilead Sciences, Inc.
Gilead is currently marketing four drugs, including Tamiflu, which gained
notice recently when the FDA approved the drug for treatment of the flu.
The company is also in development of tenofovir, a once-daily HIV drug,
which is now in Stage III clinical trials and could hit the market in the
next two years.
- - The Portfolio's top holding, Abgenix, Inc., is a biopharmaceutical company
that develops antibody therapeutic drugs for the treatment and prevention
of such conditions as transplant-related diseases, inflammatory and
autoimmune disorders, and cancer. The stock performed extremely well in the
six months ended February 29, 2000.
- - In addition to biotech stocks, large pharmaceutical companies -- both
foreign and domestic -- performed strongly through the end of February
2000. In particular, long-time holding Warner-Lambert was a strong
performer, rallying on news of a proposed merger with Pfizer.
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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.
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FUND INFORMATION
AS OF FEBRUARY 29, 2000
<TABLE>
<CAPTION>
Performance(2) Class A Class B Class C
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Average Annual Total Returns (at net asset value)
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<S> <C> <C> <C>
One Year 81.39% 80.10% 80.00%
Five Years 33.45 N.A. N.A.
Ten Years 24.02 N.A. N.A.
Life of Fund+ 20.26 29.63 41.67
SEC Average Annual Total Returns (including sales charge or applicable CDSC)
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One Year 70.92% 75.10% 79.00%
Five Years 31.88 N.A. N.A.
Ten Years 23.29 N.A. N.A.
Life of Fund+ 19.77 29.17 41.67
</TABLE>
+Inception Dates -- Class A: 7/26/85; Class B: 9/23/96; Class C:1/5/98
<TABLE>
<CAPTION>
TEN LARGEST HOLDINGS(3) By total net assets
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<S> <C>
Abgenix, Inc. 7.7%
Alexion Pharmaceuticals, Inc. 5.5
Ares-Serono 4.6
Warner-Lambert Co. 4.1
Fujisawa Pharmarceutical 3.9
Vertex Pharmaceuticals, Inc. 3.9
Tularik, Inc. 3.8
Chiron Corp. 3.6
Altana 3.5
Sanofi-Synthelabo 3.5
</TABLE>
(1) These returns do not include the 5.75% maximum sales charge for 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. Effective 3/23/00, ClassA shares
redeemed within 3 months of purchase, including exchanges, will be subject to a
1% early redemption fee. (3) Ten largest equity holdings accounted for 44.1% 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 WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF FEBRUARY 29, 2000
<S> <C>
Assets
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Investment in Worldwide Health Sciences
Portfolio, at value
(identified cost, $251,920,548) $415,220,998
Receivable for Fund shares sold 8,453,013
Tax reclaim receivable 101,524
Deferred organization expenses 14,244
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TOTAL ASSETS $423,789,779
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Liabilities
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Payable for Fund shares redeemed $ 995,216
Payable to affiliate for service fees 17,958
Dividends payable 5,887
Payable to affiliate for Trustees' fees 59
Accrued expenses 62,866
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TOTAL LIABILITIES $ 1,081,986
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NET ASSETS $422,707,793
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Sources of Net Assets
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Paid-in capital $239,791,325
Accumulated undistributed net realized
gain from Portfolio (computed on the
basis of identified cost) 21,733,572
Accumulated net investment loss (2,117,554)
Net unrealized appreciation from
Portfolio (computed on the basis of
identified cost) 163,300,450
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TOTAL $422,707,793
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Class A Shares
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NET ASSETS $185,470,660
SHARES OUTSTANDING 6,582,152
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 28.18
MAXIMUM OFFERING PRICE PER SHARE
(100 DIVIDED BY 94.25 of $28.18) $ 29.90
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Class B Shares
- ------------------------------------------------------
NET ASSETS $203,944,741
SHARES OUTSTANDING 9,761,546
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 20.89
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Class C Shares
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NET ASSETS $ 33,292,392
SHARES OUTSTANDING 1,889,367
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 17.62
- ------------------------------------------------------
</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 29, 2000
<S> <C>
Investment Income
- ------------------------------------------------------
Dividends allocated from Portfolio (net
of foreign taxes, $28,802) $ 384,008
Interest allocated from Portfolio 31,072
Miscellaneous income allocated from
Portfolio 5,231
Expenses allocated from Portfolio (1,133,176)
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NET INVESTMENT LOSS FROM PORTFOLIO $ (712,865)
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Expenses
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Management fee $ 304,966
Trustees fees and expenses 2,332
Distribution and service fees
Class A 132,224
Class B 631,578
Class C 57,328
Transfer and dividend disbursing
agent fees 153,787
Registration fees 48,980
Printing and postage 29,599
Custodian fee 14,060
Legal and accounting services 9,993
Amortization of organization expenses 3,946
Miscellaneous 29,901
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TOTAL EXPENSES $ 1,418,694
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Deduct --
Reduction of custodian fee $ 14,005
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TOTAL EXPENSE REDUCTIONS $ 14,005
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NET EXPENSES $ 1,404,689
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NET INVESTMENT LOSS $ (2,117,554)
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Realized and Unrealized
Gain (Loss) from Portfolio
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Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 26,072,128
Foreign currency transactions (63,720)
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NET REALIZED GAIN $ 26,008,408
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Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $121,141,571
Foreign currency (45,777)
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NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $121,095,794
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NET REALIZED AND UNREALIZED GAIN $147,104,202
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NET INCREASE IN NET ASSETS FROM
OPERATIONS $144,986,648
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</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INCREASE (DECREASE) FEBRUARY 29, 2000 YEAR ENDED
IN NET ASSETS (UNAUDITED) AUGUST 31, 1999
<S> <C> <C>
- ----------------------------------------------------------------------------
From operations --
Net investment loss $ (2,117,554) $ (2,666,694)
Net realized gain 26,008,408 19,224,127
Net change in unrealized
appreciation (depreciation) 121,095,794 57,462,880
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NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 144,986,648 $ 74,020,313
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Distributions to shareholders --
From net realized gain
Class A $ (6,972,510) $ (3,621,408)
Class B (11,143,002) (5,013,898)
Class C (948,082) (197,322)
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TOTAL DISTRIBUTIONS TO SHAREHOLDERS $ (19,063,594) $ (8,832,628)
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Transactions in shares of beneficial interest --
Proceeds from sale of shares
Class A $ 49,542,911 $ 29,816,201
Class B 35,371,026 15,461,673
Class C 19,624,247 5,035,458
Net asset value of shares issued to
shareholders in payment of
distributions declared
Class A 6,507,983 3,420,168
Class B 8,544,818 4,719,635
Class C 678,079 193,239
Cost of shares redeemed
Class A (16,631,886) (41,587,153)
Class B (9,796,898) (20,458,515)
Class C (1,969,492) (721,473)
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NET INCREASE (DECREASE) IN NET ASSETS
FROM FUND SHARE TRANSACTIONS $ 91,870,788 $ (4,120,767)
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NET INCREASE IN NET ASSETS $ 217,793,842 $ 61,066,918
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Net Assets
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At beginning of period $ 204,913,951 $ 143,847,033
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AT END OF PERIOD $ 422,707,793 $ 204,913,951
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Accumulated net investment loss included in net assets
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AT END OF PERIOD $ (2,117,554) $ --
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</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 -------------------------------------------------------------
(UNAUDITED)(1) 1999(1) 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning
of period $ 18.490 $12.550 $14.930 $13.540 $11.710 $ 9.150
- --------------------------------------------------------------------------------------------------------------------
Income (loss) from operations
- --------------------------------------------------------------------------------------------------------------------
Net investment loss $ (0.131) $(0.182) $(0.209) $(0.133) $(0.230) $(0.170)
Net realized and unrealized
gain (loss) 11.244 6.794 (2.171) 1.818 3.460 3.410
- --------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 11.113 $ 6.612 $(2.380) $ 1.685 $ 3.230 $ 3.240
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Less distributions
- --------------------------------------------------------------------------------------------------------------------
From net realized gain $ (1.423) $(0.672) $ -- $(0.295) $(1.400) $(0.680)
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TOTAL DISTRIBUTIONS $ (1.423) $(0.672) $ -- $(0.295) $(1.400) $(0.680)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $ 28.180 $18.490 $12.550 $14.930 $13.540 $11.710
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TOTAL RETURN(2) 64.91% 53.28% (15.94)% 17.67% 31.04% 38.13%
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Ratios/Supplemental Data+
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Net assets, end of period
(000's omitted) $185,471 $89,214 $66,831 $88,349 $55,016 $17,690
Ratios (As a percentage of
average daily net assets):
Net operating
expenses(3)(4) 1.70%(5) 1.69% 1.83% 2.07% 2.21% 2.44%
Net operating expenses
after custodian fee
reduction(3) 1.64%(5) 1.63% 1.69% 2.00% -- --
Interest expense(3) 0.01%(5) 0.01% -- -- -- --
Net investment loss (1.30)%(5) (1.11)% (1.21)% (1.60)% (1.81)% (1.80)%
Portfolio Turnover of the
Fund(6) -- -- -- -- 66% 45%
Portfolio Turnover of the
Portfolio(6) 21% 41% 34% 14% -- --
- --------------------------------------------------------------------------------------------------------------------
+ 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 income per share would have been as follows:
Ratios (As a percentage of
average daily net assets):
Operating expenses(3)(4) 2.29% -- --
Operating expenses after
custodian fee
reduction(3) 2.22% -- --
Net investment loss (1.82)% -- --
Net investment loss per share $(0.151) -- --
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Net investment loss per share was computed using average shares
outstanding.
(2) 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 reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the corresponding Portfolio's allocated
expenses for the period the Fund was investing in the Portfolio.
(4) 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 ratio for the year ended August 31, 1995 has not been adjusted
to reflect this change.
(5) Annualized.
(6) Portfolio Turnover of the Fund represents the rate of portfolio activity
for the period while the Fund was making investments directly in
securities. The Fund began investing in the Portfolio on
September 1, 1996.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS B
-------------------------------------------
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 ----------------------
(UNAUDITED)(1) 1999(1) 1998
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
Net asset value -- Beginning
of period $ 14.120 $ 9.760 $11.680
- -----------------------------------------------------------------------------
Income (loss) from operations
- -----------------------------------------------------------------------------
Net investment loss $ (0.154) $ (0.214) $(0.204)
Net realized and unrealized
gain (loss) 8.347 5.246 (1.716)
- -----------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 8.193 $ 5.032 $(1.920)
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Less distributions
- -----------------------------------------------------------------------------
From net realized gain $ (1.423) $ (0.672) $ --
- -----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $ (1.423) $ (0.672) $ --
- -----------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $ 20.890 $ 14.120 $ 9.760
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TOTAL RETURN(2) 64.28% 52.29% (16.44)%
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Ratios/Supplemental Data
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Net assets, end of period
(000's omitted) $203,945 $107,923 $75,111
Ratios (As a percentage of
average daily net assets):
Net operating expenses(3) 2.45%(4) 2.29% 2.43%
Net operating expenses
after custodian fee
reduction(3) 2.39%(4) 2.23% 2.29%
Interest expense(3) 0.01%(4) 0.01% --
Net investment loss (2.04)%(4) (1.70)% (1.80)%
Portfolio Turnover of the
Portfolio 21% 41% 34%
- -----------------------------------------------------------------------------
</TABLE>
(1) Net investment loss per share was computed using average shares
outstanding.
(2) 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 reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the Portfolio's allocated expenses.
(4) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS C
-------------------------------------------
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 ----------------------
(UNAUDITED)(1) 1999(1) 1998(2)
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
Net asset value -- Beginning
of period $12.130 $ 8.460 $10.000
- -----------------------------------------------------------------------------
Income (loss) from operations
- -----------------------------------------------------------------------------
Net investment loss $(0.136) $(0.199) $(0.076)
Net realized and unrealized
gain (loss) 7.049 4.541 (1.464)
- -----------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 6.913 $ 4.342 $(1.540)
- -----------------------------------------------------------------------------
Less distributions
- -----------------------------------------------------------------------------
From net realized gain $(1.423) $(0.672) $ --
- -----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $(1.423) $(0.672) $ --
- -----------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $17.620 $12.130 $ 8.460
- -----------------------------------------------------------------------------
TOTAL RETURN(3) 64.28% 52.16% (15.40)%
- -----------------------------------------------------------------------------
Ratios/Supplemental Data
- -----------------------------------------------------------------------------
Net assets, end of period
(000's omitted) $33,292 $ 7,778 $ 1,905
Ratios (As a percentage of
average daily net assets):
Net operating expenses(4) 2.44%(5) 2.44% 2.67%(5)
Net operating expenses
after custodian fee
reduction(4) 2.38%(5) 2.38% 2.53%(5)
Interest expense(4) 0.01%(5) 0.01% --
Net investment loss (2.06)%(5) (1.82)% (1.84)%(5)
Portfolio Turnover of the
Portfolio 21% 41% 34%
- -----------------------------------------------------------------------------
</TABLE>
(1) Net investment loss per share was computed using average shares
outstanding.
(2) For the period from the commencement of offering of Class C shares,
January 5, 1998, to August 31, 1998.
(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 to be
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
7
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1 Significant Accounting Policies
- -------------------------------------------
Eaton Vance Worldwide Health Sciences 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 generally 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). Each Class represents a pro
rata interest in the Fund, but votes separately on class-specific matters and
(as noted below) is subject to different expenses. 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 (98.9% at February 29, 2000). 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 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 total expenses in the Statement of Operations.
F 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 income 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 29, 2000 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 gain (reduced by any available
capital loss carry forwards 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.
8
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
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 29, 2000, the fee was equivalent to 0.25% (annualized) of the
Fund's average daily net assets and amounted to $304,966. Except for 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. The Fund was informed that Eaton Vance Distributors, Inc. (EVD), a
subsidiary of EVM and the Fund's principal underwriter, received $77,119 from
the Fund as its portion of the sales charge on sales of Class A shares for
the six months ended February 29, 2000.
Certain officers and Trustees of the Fund and of the Portfolio are officers
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 series (such as
the Fund) and classes. Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
CLASS A (UNAUDITED) AUGUST 31, 1999
<S> <C> <C>
-------------------------------------------------------------------------------
Sales 2,184,652 1,828,443
Issued to shareholders electing to
receive payments of distributions in
Fund shares 370,454 205,562
Redemptions (796,663) (2,533,601)
-------------------------------------------------------------------------------
NET INCREASE (DECREASE) 1,758,443 (499,596)
-------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
CLASS B (UNAUDITED) AUGUST 31, 1999
<S> <C> <C>
-------------------------------------------------------------------------------
Sales 2,119,102 1,205,173
Issued to shareholders electing to
receive payments of distributions in
Fund shares 650,298 369,828
Redemptions (648,597) (1,632,152)
-------------------------------------------------------------------------------
NET INCREASE (DECREASE) 2,120,803 (57,151)
-------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
FEBRUARY 29, 2000 YEAR ENDED
CLASS C (UNAUDITED) AUGUST 31, 1999
<S> <C> <C>
-------------------------------------------------------------------------------
Sales 1,340,411 464,942
Issued to shareholders electing to
receive payments of distributions in
Fund shares 60,916 17,615
Redemptions (153,222) (66,467)
-------------------------------------------------------------------------------
NET INCREASE 1,248,105 416,090
-------------------------------------------------------------------------------
</TABLE>
5 Distribution Plans
- -------------------------------------------
Each Class of the Fund has in effect 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 EVD in an
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 investment dealers for providing personal
services to shareholders. For the six months ended February 29, 2000, the
Class A shares paid or accrued $132,224 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
9
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
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) interest
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 Fund paid or accrued $469,248 and $42,996 for Class B
and Class C shares, respectively, payable to EVD for the six months ended
February 29, 2000, representing 0.75% (annualized) of the average daily net
assets for Class B and Class C shares, respectively. At February 29, 2000,
the amount of Uncovered Distribution Charges of EVD calculated under the
Plans was approximately $4,625,000 and $1,564,000 for Class B and Class C
shares, respectively.
The Plans authorize the Class B and Class C shares to make payments of
service fees to EVD, investment dealers 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 initially implemented the
Plans by authorizing Class B shares to make quarterly payments of service
fees to EVD and investment dealers in amounts equal to 0.25% per annum of the
average daily net assets attributable to Class B shares based on the value of
Fund shares sold by such persons and remaining outstanding for at least one
year. On October 4, 1999, the Trustees approved service fee payments equal to
0.25% per annum of the Fund's average daily net assets attributable to
Class B shares for any fiscal year on shares sold on or after October 12,
1999. The Class C Plan permits the Fund to make monthly payments of service
fees in amounts not expected to exceed 0.25% of the Fund's average daily net
assets attributable to Class C shares for any fiscal 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 29, 2000 amounted to $162,330 and $14,332 for Class B
and Class C shares, respectively.
6 Contingent Deferred Sales Charge
- -------------------------------------------
A contingent deferred sales charge (CDSC) generally is imposed on redemptions
of Class B shares made within six years of purchase and on redemptions of
Class C shares made 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 and may be waived under certain
other limited conditions. 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. For the six months ended
February 29, 2000, the Fund was informed that EVD received approximately
$186,000 and $10,000 of CDSC paid by shareholders for Class B and Class C
shares, respectively.
7 Investment Transactions
- -------------------------------------------
Increases and decreases in the Fund's investment in the Portfolio for the six
months ended February 29, 2000 aggregated $94,821,667 and $30,404,038,
respectively.
10
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
PORTFOLIO OF INVESTMENTS (UNAUDITED)
(EXPRESSED IN UNITED STATES DOLLARS)
COMMON STOCKS AND WARRANTS -- 91.76%
<TABLE>
<CAPTION>
PERCENTAGE OF
SECURITY SHARES VALUE NET ASSETS
<S> <C> <C> <C>
- -------------------------------------------------------------------------------
Major Capitalization - Europe -- 14.75%
- -------------------------------------------------------------------------------
Altana 235,600 $ 14,838,524 3.53%
Ares-Serono 6,000 19,446,612 4.63%
Roche Holding AG 1,200 12,950,003 3.08%
Sanofi-Synthelabo(1) 382,000 14,733,875 3.51%
- -------------------------------------------------------------------------------
$ 61,969,014 14.75%
- -------------------------------------------------------------------------------
Major Capitalization - Far East -- 10.89%
- -------------------------------------------------------------------------------
Banyu Pharmaceutical Co. 550,000 $ 8,463,465 2.02%
Eisai Co., Ltd. 500,000 11,814,250 2.81%
Fujisawa Pharmaceutical 500,000 16,435,238 3.91%
Takeda Chemical Industries Ltd. 160,000 9,032,552 2.15%
- -------------------------------------------------------------------------------
$ 45,745,505 10.89%
- -------------------------------------------------------------------------------
Major Capitalization - North America -- 29.55%
- -------------------------------------------------------------------------------
Abgenix, Inc.(1) 100,000 $ 32,212,500 7.67%
Alza Corp.(1) 145,000 5,319,687 1.27%
American Home Products Corp. 200,000 8,700,000 2.07%
Chiron Corp.(1) 300,000 15,000,000 3.57%
Genzyme Corp., Class A(1) 200,000 11,487,500 2.74%
Gilead Sciences, Inc.(1) 130,000 9,945,000 2.37%
Lilly (Eli) & Co. 150,000 8,915,625 2.12%
Monsanto Co. 250,000 9,703,125 2.31%
Pharmacia & Upjohn, Inc. 120,000 5,715,000 1.36%
Warner-Lambert Co. 200,000 17,112,500 4.07%
- -------------------------------------------------------------------------------
$124,110,937 29.55%
- -------------------------------------------------------------------------------
Specialty Capitalization - Europe -- 1.07%
- -------------------------------------------------------------------------------
Swiss Serum Institute 328 $ 4,478,723 1.07%
- -------------------------------------------------------------------------------
$ 4,478,723 1.07%
- -------------------------------------------------------------------------------
Specialty Capitalization - Far East -- 4.43%
- -------------------------------------------------------------------------------
Chugai Pharmaceuticals, Co., Ltd. 600,000 $ 9,178,238 2.19%
Rohto Pharmaceutical 137,000 836,557 0.20%
Shionogi & Co., Ltd. 600,000 8,577,282 2.04%
- -------------------------------------------------------------------------------
$ 18,592,077 4.43%
- -------------------------------------------------------------------------------
Specialty Capitalization - North America -- 31.07%
- -------------------------------------------------------------------------------
Alexion Pharmaceuticals, Inc.(1) 270,000 $ 23,017,500 5.48%
Aviron(1) 250,000 10,140,625 2.41%
Bio-Technology General Corp.(1) 500,000 9,609,400 2.29%
Forest Laboratories Inc.(1) 140,000 9,563,750 2.28%
<CAPTION>
PERCENTAGE OF
SECURITY SHARES VALUE NET ASSETS
<S> <C> <C> <C>
- -------------------------------------------------------------------------------
Specialty Capitalization - North America (continued)
- -------------------------------------------------------------------------------
Geltex Pharaceuticals, Inc.(1) 380,000 $ 8,336,250 1.99%
LJL Biosystems, Inc.(1) 150,000 5,662,500 1.35%
Orchid Biocomputer Warrants(1)(2)(3) 50,000 162,500 0.04%
Pathogenesis Corp.(1) 222,200 6,860,425 1.63%
Pharmacopeia, Inc.(1) 173,000 11,774,812 2.80%
Premier Research Worldwide(1) 293,600 4,994,625 1.19%
SangStat Medical Corp.(1) 190,000 8,217,500 1.96%
Tularik, Inc.(2)(3) 200,000 15,775,000 3.76%
Vertex Pharmaceuticals, Inc.(1) 225,000 16,340,625 3.89%
- -------------------------------------------------------------------------------
$130,455,512 31.07%
- -------------------------------------------------------------------------------
Total Common Stocks and Warrants
(identified cost $221,627,280) $385,351,768
- -------------------------------------------------------------------------------
</TABLE>
PREFERRED STOCKS -- 2.62%
<TABLE>
<CAPTION>
PERCENTAGE OF
SECURITY SHARES VALUE NET ASSETS
<S> <C> <C> <C>
- -------------------------------------------------------------------------------
Specialty Capitalization - North America -- 2.62%
- -------------------------------------------------------------------------------
Adolor, Inc.(1)(2)(3) 500,000 $ 500,000 0.12%
Arena Pharmaceuticals(1)(2)(3) 500,000 2,000,002 0.48%
Intrabiotics Pharm, Inc.(1)(2)(3) 333,334 1,333,336 0.32%
Net Genics, Inc. Convertible, Series D,
Preferred R(1)(2)(3) 250,000 575,000 0.14%
Net Genics, Inc., Series E(1)(2)(3) 652,173 1,499,998 0.36%
Ontogeny, Inc.(1)(2)(3) 600,000 1,830,000 0.43%
Orchid Biocomputer, Inc., Series
C(1)(2)(3) 180,180 1,278,410 0.30%
Orchid Biocomputer, Inc., Series
E(1)(2)(3) 457,203 1,999,999 0.47%
- -------------------------------------------------------------------------------
$ 11,016,745 2.62%
- -------------------------------------------------------------------------------
Total Preferred Stocks
(identified cost $10,411,351) $ 11,016,745
- -------------------------------------------------------------------------------
Total Investments
(identified cost $232,038,631) $396,368,513 94.38%
- -------------------------------------------------------------------------------
Other Assets, Less Liabilities $ 23,613,069 5.62%
- -------------------------------------------------------------------------------
Net Assets $419,981,582 100.00%
- -------------------------------------------------------------------------------
</TABLE>
(1) Non-income producing security.
(2) Security valued at fair value using methods determined in good faith by
or at the direction of the Trustees.
(3) Restricted security.
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF FEBRUARY 29, 2000
(EXPRESSED IN UNITED STATES DOLLARS)
<S> <C>
Assets
- ------------------------------------------------------
Investments, at value
(identified cost, $232,038,631) $396,368,513
Cash 22,804,675
Foreign currency, at value
(identified cost, $5,275,681) 5,126,962
Receivable for investments sold 650,636
Interest and dividends receivable 160,805
Receivable for open forward foreign
currency contracts 981
Deferred organization expenses 4,625
- ------------------------------------------------------
TOTAL ASSETS $425,117,197
- ------------------------------------------------------
Liabilities
- ------------------------------------------------------
Payable for investments purchased $ 5,126,963
Payable to affiliate for Trustees' fees 1,779
Accrued expenses 6,873
- ------------------------------------------------------
TOTAL LIABILITIES $ 5,135,615
- ------------------------------------------------------
NET ASSETS APPLICABLE TO INVESTORS'
INTEREST IN PORTFOLIO $419,981,582
- ------------------------------------------------------
Sources of Net Assets
- ------------------------------------------------------
Net proceeds from capital contributions
and withdrawals $255,694,044
Net unrealized appreciation (computed on
the basis of identified cost) 164,287,538
- ------------------------------------------------------
TOTAL $419,981,582
- ------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
FEBRUARY 29, 2000
(EXPRESSED IN UNITED STATES DOLLARS)
<S> <C>
Investment Income
- ------------------------------------------------------
Dividends (net of foreign
taxes, $28,913) $ 386,009
Interest 31,129
Miscellaneous 5,263
- ------------------------------------------------------
TOTAL INVESTMENT INCOME $ 422,401
- ------------------------------------------------------
Expenses
- ------------------------------------------------------
Investment adviser fee $ 796,314
Administration fee 307,408
Trustees fees and expenses 10,157
Custodian fee 71,744
Legal and accounting services 13,698
Interest expense 8,361
Amortization of organization expenses 1,197
Miscellaneous 1,450
- ------------------------------------------------------
TOTAL EXPENSES $ 1,210,329
- ------------------------------------------------------
Deduct --
Reduction of custodian fee $ 70,478
- ------------------------------------------------------
TOTAL EXPENSE REDUCTIONS $ 70,478
- ------------------------------------------------------
NET EXPENSES $ 1,139,851
- ------------------------------------------------------
NET INVESTMENT LOSS $ (717,450)
- ------------------------------------------------------
Realized and Unrealized Gain (Loss)
- ------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 26,266,901
Foreign currency and forward foreign
currency exchange
contract transactions (63,351)
- ------------------------------------------------------
NET REALIZED GAIN $ 26,203,550
- ------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $122,033,339
Foreign currency and forward foreign
currency exchange contracts (42,344)
- ------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $121,990,995
- ------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN $148,194,545
- ------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $147,477,095
- ------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
(EXPRESSED IN UNITED STATES DOLLARS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INCREASE (DECREASE) FEBRUARY 29, 2000 YEAR ENDED
IN NET ASSETS (UNAUDITED) AUGUST 31, 1999
<S> <C> <C>
- ----------------------------------------------------------------------------
From operations --
Net investment loss $ (717,450) $ (784,314)
Net realized gain 26,203,550 19,258,866
Net change in unrealized
appreciation (depreciation) 121,990,995 57,606,206
- ----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 147,477,095 $ 76,080,758
- ----------------------------------------------------------------------------
Capital transactions --
Contributions $ 98,009,569 $ 58,763,929
Withdrawals (30,585,723) (74,426,211)
- ----------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL TRANSACTIONS $ 67,423,846 $ (15,662,282)
- ----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 214,900,941 $ 60,418,476
- ----------------------------------------------------------------------------
Net Assets
- ----------------------------------------------------------------------------
At beginning of period $ 205,080,641 $ 144,662,165
- ----------------------------------------------------------------------------
AT END OF PERIOD $ 419,981,582 $ 205,080,641
- ----------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
FINANCIAL STATEMENTS CONT'D
SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 2000 -----------------------------------
(UNAUDITED) 1999 1998 1997
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
Ratios to average daily net assets
- ------------------------------------------------------------------------------------------
Operating expenses 0.97%(1) 0.95% 1.06% 1.25%
Expenses after custodian fee
reduction 0.92%(1) 0.90% 0.92% 1.18%
Interest expense 0.01%(1) 0.01% -- --
Net investment loss (0.58)%(1) (0.42)% (0.49)% (0.81)%
Portfolio Turnover 21% 41% 34% 14%
- ------------------------------------------------------------------------------------------
NET ASSETS, END OF PERIOD
(000'S OMITTED) $419,982 $205,081 $144,662 $152,717
- ------------------------------------------------------------------------------------------
</TABLE>
(1) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
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 Portfolio seeks long-term capital growth
by investing in a global and diversified portfolio of securities of health
sciences companies. 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 accounting principles generally accepted in the United States
of America.
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 -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or accretion of discount when required
for federal income tax purposes. Dividend income is recorded on the ex-
dividend date for dividends received in cash and/or securities. 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.
C Income 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 one of the Portfolio's investors is a regulated investment
company that invests all or substantially all of its 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 Portfolio's
understanding of the applicable countries' tax rules and rates.
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 credits which are determined based on the average daily cash
balance the Portfolio maintains with IBT. All significant credit balances
used to reduce the Portfolio's custodian fees are reflected as a reduction of
total operating expenses 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 changes in foreign currency exchange
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 results from fluctuations in foreign currency exchange rates
is 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
15
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
gains and losses are recorded for financial statement purposes as unrealized
until such time as the contracts have been closed.
I Other -- Investment transactions are accounted for on a trade date basis.
Realized gains and losses are computed based on the specific identification
of the securities sold.
J Interim Financial Statements -- The interim financial statements relating to
February 29, 2000 and for the six months 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's 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% 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 29, 2000, the fee was
equivalent to 0.64% (annualized) of the Portfolio's average daily net assets
and amounted to $796,314.
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 million, and at reduced rates as daily net assets exceed that
level. For the six months ended February 29, 2000, the administration fee was
0.25% (annualized) of average net assets and amounted to $307,408.
Except for 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 officers 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 29, 2000, no significant
amounts have been deferred.
3 Investments
- -------------------------------------------
Purchases and sales of investments other than U.S. Government securities and
short-term obligations aggregated $98,399,864 and $53,066,023, respectively,
for the six months ended February 29, 2000.
4 Federal Income Tax Basis of Investments
- -------------------------------------------
The cost and unrealized appreciation (depreciation) in value of the
investments owned at February 29, 2000, as computed on a federal income tax
basis, were as follows:
<TABLE>
<S> <C>
AGGREGATE COST $232,038,631
------------------------------------------------------
Gross unrealized appreciation $169,822,940
Gross unrealized depreciation (5,493,058)
------------------------------------------------------
NET UNREALIZED APPRECIATION $164,329,882
------------------------------------------------------
</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 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 Line of Credit
- -------------------------------------------
The Portfolio participates with other portfolios and funds managed by EVM and
its affiliates in a committed $150 million unsecured line of credit agreement
with a group of banks. Borrowings will be made by the portfolios
16
<PAGE>
WORLDWIDE HEALTH SCIENCES PORTFOLIO AS OF FEBRUARY 29, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
(EXPRESSED IN UNITED STATES DOLLARS)
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. The Portfolio
did not have any significant borrowings or allocated fees during the six
months ended February 29, 2000.
7 Restricted Securities
- -------------------------------------------
At February 29, 2000, the Portfolio owned the following securities
(representing 6.42% 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. This valuation may differ from the value that
would be realized if the securities were sold and the difference could be
material to the financial statements.
<TABLE>
<CAPTION>
SHARES/
PRINCIPAL
AMOUNT
DATE OF (000'S
DESCRIPTION ACQUISITION OMITTED) COST FAIR VALUE
<S> <C> <C> <C> <C>
------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
------------------------------------------------------------------------------------------
Orchid Biocomputer Warrants 5/24/99 50,000 $ 0 $ 162,500
Tularik, Inc. 10/14/96 200,000 2,000,000 15,775,000
------------------------------------------------------------------------------------------
$ 2,000,000 $15,937,500
PREFERRED STOCKS
------------------------------------------------------------------------------------------
Adolor, Inc. 1/10/00 500,000 $ 500,000 $ 500,000
Arena Pharmaceuticals 1/28/99 500,000 1,411,354 2,000,002
Intrabiotics Pharm, Inc. 11/24/98 333,334 1,000,002 1,333,336
Net Genics, Inc. Convertible, Series D,
Preferred R 3/20/98 250,000 500,000 575,000
Net Genics, Inc., Series E 12/21/99 652,173 1,499,998 1,499,998
Ontogeny, Inc. 3/13/97 600,000 1,500,000 1,830,000
Orchid Biocomputer, Inc., Series C 12/19/97 180,180 1,999,998 1,278,410
Orchid Biocomputer, Inc., Series E 12/20/99 457,203 1,999,999 1,999,999
------------------------------------------------------------------------------------------
$10,411,351 $11,016,745
</TABLE>
8 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 forward foreign currency exchange contracts and 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. A summary of obligations under
these financial instruments at February 29, 2000 is as follows:
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
<TABLE>
<CAPTION>
SALES
------------------------------------------------------------------------------------------
SETTLEMENT IN EXCHANGE FOR NET UNREALIZED
DATE(S) DELIVER (IN U.S. DOLLARS) APPRECIATION
<S> <C> <C> <C>
------------------------------------------------------------------------------------------
3/1/00 Japanese Yen
16,855,754 154,484 981
------------------------------------------------------------------------------------------
$ 154,484 $ 981
------------------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND AS OF FEBRUARY 29, 2000
INVESTMENT MANAGEMENT
EATON VANCE WORLDWIDE HEALTH SCIENCES 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
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
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
Jack L. Treynor
Investment Adviser and Consultant
18
<PAGE>
SPONSOR AND MANAGER OF EATON VANCE
WORLDWIDE HEALTH SCIENCES FUND & ADMINISTRATOR OF
WORLDWIDE HEALTH SCIENCES PORTFOLIO
Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, MA 02109
ADVISER OF WORLDWIDE HEALTH SCIENCES PORTFOLIO
OrbiMed Advisors, Inc.
767 3rd Avenue
New York, NY 10017
PRINCIPAL UNDERWRITER
EATON VANCE DISTRIBUTORS, INC.
The Eaton Vance Building
255 State Street
Boston, MA 02109
(617) 482-8260
CUSTODIAN
Investors Bank & Trust Company
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT
PFPC, Inc.
Attn: Eaton Vance Funds
P.O. Box 9653
Providence, RI 02904-9653
(800) 262-1122
EATON VANCE WORLDWIDE HEALTH SCIENCES FUND
THE EATON VANCE BUILDING
255 STATE STREET
BOSTON, MA 02109
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
426-4/00 HSSRC-4/00
