Evergreen
International
and Global Growth Funds
April 30, 1998
Semiannual Report
<PAGE>
Table of Contents
<TABLE>
<S> <C>
Letter to Shareholders ..................... 1
Evergreen Emerging Markets Growth
Fund
Fund at a Glance ........................ 2
Portfolio Manager Interview ............. 3
Evergreen Global Leaders Fund
Fund at a Glance ........................ 5
Portfolio Manager Interview ............. 6
Evergreen International Equity Fund
Fund at a Glance ........................ 9
Portfolio Manager Interview ............. 10
Financial Highlights
Evergreen Emerging Markets Growth
Fund ................................. 12
Evergreen Global Leaders Fund ........... 14
Evergreen International Equity Fund ..... 16
</TABLE>
<TABLE>
<S> <C>
Schedules of Investments
Evergreen Emerging Markets Growth
Fund ................................. 18
Evergreen Global Leaders Fund ........... 22
Evergreen International Equity Fund ..... 27
Statements of Assets and Liabilities ....... 32
Statements of Operations ................... 33
Statements of Changes in Net Assets --
Six Months Ended April 30, 1998
(Unaudited) .......................... 34
Statements of Changes in Net Assets --
For the Year Ended October 31, 1997 ..... 35
Combined Notes to Financial
Statements ............................... 36
Additional Information ..................... 42
</TABLE>
- --------------------------------------------------------------------------------
Evergreen Funds
Evergreen Funds is one of the nation's fastest growing investment companies with
more than $47 billion in assets under management.
With over 80 mutual funds to choose among and acclaimed service and operations
capabilities, investors enjoy a broader range of quality investment products and
services designed to meet their needs.
The Evergreen Funds employ intensive, research-driven investment strategies
executed by over 90 research analysts and portfolio managers. The fund company
remains dedicated to meeting the needs of investors and their advisors in a
global economy. Look to the Evergreen Funds to provide a distinctive level of
service and excellence in investment management.
This semiannual report must be preceded or accompanied by a prospectus of an
Evergreen fund contained herein. The prospectus contains more complete
information, including fees and expenses, and should be read carefully before
investing or sending money.
<TABLE>
<S> <C> <C>
Mutual Funds: ARE NOT FDIC INSURED May lose value o Are not bank guaranteed
</TABLE>
Evergreen Funds Distributor, Inc.
International investing involves increased risk and volatility.
<PAGE>
Letter to Shareholders
June 1998
Dear Shareholders:
Investing in the global markets during recent
(Photo of months has been nothing, if not interesting.
William M. Ennis) Fortunately for most investors, it also has been
rewarding.
William M. Ennis In general, the world stock markets had a
Managing Director buoyant run during the six months ending
April 30, 1998, the period of this semiannual
report. Led by the continued health of the U.S. economy and by the very strong
economic recovery in Western Europe, most markets posted strong gains, as
evidenced by the 18.86% return of the Morgan Stanley Capital International
(MSCI) World Index. The exceptions, of course, were in Asia and the emerging
markets. The financial and currency crisis that erupted in October 1997
throughout the Pacific Basin has been persistent in its effects in the region.
Equity investments in Japan, Hong Kong and other Asian nations have been
challenging, to say the least. These problems have tarnished other emerging
markets, most notably in Latin America, despite good long-term prospects.
Large Cap Leadership
During the six months, the leadership in both the United States and Western
Europe has been maintained by the large, well-established, "blue chip" companies
that have been able to improve earnings, take advantage of their visibility,
and, in many cases, strengthen themselves through strategic acquisitions. These
large-cap companies have also attracted the major share of the new investment
dollars in their markets. Smaller and mid-sized companies, as a group, have not
enjoyed as strong stock performance, although recent stock price valuations have
been very attractive for smaller companies, especially for those that have shown
an ability to improve their earnings.
The general strength of the world's equity markets, even with the exceptions
highlighted by the Asian crisis, demonstrates the importance of global
diversification of an investment portfolio. At Evergreen, we strongly believe
most growth-oriented investors should have at least part of their stock
investments in global or international funds, both to take advantage of
opportunities not available in the United States and to increase the
diversification and risk control of their overall portfolios.
We are very pleased to offer a strong group of international and global funds,
each of which has its own distinct strategy, reflecting the varying objectives,
and risk tolerances of different investors. In the following pages, we present
specific reports on the management and performance of Evergreen International
and Global Growth Funds for the six-month period.
The Evergreen Commitment
At Evergreen Funds, we are committed to providing a strong array of funds with
complementary objectives and strategies to help investors and their financial
advisors assemble personal portfolios that make sense for their needs and risk
tolerances.
We can assist by providing the information you need about our funds. If you have
any questions about the Evergreen International and Global Growth Funds or other
Evergreen Funds, we encourage you to consult your financial advisor or call us
at 800-343-2898.
Thank you for your continued investment with Evergreen Funds.
Sincerely,
/s/ William M. Ennis
William M. Ennis
Managing Director
Evergreen Funds
1
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Fund at a Glance as of April 30, 1998
In a period of great volatility, we tried to preserve capital by being
relatively defensive.
Portfolio
Management
----------------------------------------
(Photo of Gilman Gunn)
Gilman Gunn
Tenure: September 1997
-------------------------------------------------------
CURRENT INVESTMENT STYLE
Morningstar's Style Box is based on a
portfolio date as of 3/31/98.
(Graphic) The Equity Style Box placement is based on a
fund's price-to-earnings and price-to-book
ratio relative to the S&P 500, as well as the
size of the companies in which it invests, or
median market capitalization.
Source: 1998 Morningstar, Inc.
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS*
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Class A Class B Class C Class Y
Inception Date 9/6/94 9/6/94 9/6/94 9/6/94
..........................................................................
Average Annual Returns
..........................................................................
6 months with sales charge 5.12% 5.10% 9.11% n/a
..........................................................................
6 months w/o sales charge 10.36% 10.10% 10.11% 10.40%
..........................................................................
1 year with sales charge 9.39% 9.15% 13.16% n/a
..........................................................................
1 year w/o sales charge 14.84% 14.15% 14.16% 15.10%
..........................................................................
3 years 11.98% 12.28% 13.08% 14.05%
..........................................................................
Since Inception 1.54% 1.49% 2.25% 3.12%
..........................................................................
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
..........................................................................
6-month income dividends per
share -- -- -- $ 0.01
..........................................................................
6-month capital gain
distributions per share $ 0.25 $ 0.25 $ 0.25 $ 0.25
..........................................................................
</TABLE>
*Adjusted for maximum sales charge.
[PERFORMANCE GRAPH APPEARS HERE WITH THE FOLLOWING PLOT POINTS]
<TABLE>
<CAPTION>
<S> <C>
- --------------------------------------------------------------------------------
LONG TERM GROWTH
9/94 4/95 10/95 4/96 10/96 4/97 10/97 4/98
Class A Shares 9,525 7,341 7,701 8,992 8,296 9,424 9,807 10,823
MSEMI 10,000 7,788 7,725 8,729 8,121 8,924 7,284 7,544
MSEAFEI 10,000 10,479 10,328 11,710 11,444 11,640 12,007 13,879
CPI 10,000 10,167 10,288 10,453 10,596 10,723 10,817 10,877
</TABLE>
Comparison of a $10,000 investment in Evergreen Emerging Markets Fund, Class A
shares, versus a similar investment in the Morgan Stanley Emerging Markets Index
(MSEMI), the Morgan Stanley Europe, Australia, and Far East Index
(MSEAFEI) and the Consumer Price Index (CPI).
Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads and fees paid by the shareholders
investing in each class. The investment return and principal value will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than original cost. The MS EMI and the MS EAFEI are unmanaged indices and do not
include transaction costs associated with buying and selling securities nor any
management fees. The Consumer Price Index is a commonly used measure of
inflation and does not represent an investment return. It is not possible to
invest directly in an index.
2
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
- --------------------------------------------------------------------------------
How did the Fund perform during the six-month period?
In a period of significant volatility in the emerging markets, the Fund
performed very well. For the six months ending April 30, 1998, the Fund's
Class A shares had a total return of 10.36%, while Class B and Class C
shares had returns of 10.10% and 10.11% respectively. These returns are
unadjusted for sales charges. Class Y shares had a return of 10.40%. During
the same six-month period, the Morgan Stanley Capital International Emerg
ing Markets Index had a return of 3.64%.
Portfolio Characteristics
-------------------------
Total Net Assets $79,708,379
Number of Holdings 104
- --------------------------------------------------------------------------------
What factors contributed to this good, relative performance?
In a period of great volatility, we tried to preserve capital by being
relatively defensive. We managed risk by increasing cash, cutting losses
and lowering the weighting in Asia. We also trimmed back somewhat in Latin
America. Cash, which has been as high as 43% of net assets at times during
the period, was still at 11% of assets at the end of the period on
April 30.
We also were helped by being in a few markets that did very well, most
specifically Portugal, Greece and Hungary. In both Portugal and Greece, we
took profits and cut back our exposure when we believed prices were high
after extremely strong market rallies. In Greece, for example, we have
reduced our weighting from 10% to less than 3%. In Portugal, the weighting
was also reduced to approximately 9% at the end of the period and was down
to 6 1/2% by mid-May, after the period ended. Even though we like to be
long-term investors, the emerging markets have been so volatile that we
have tried to be nimble to avoid some of this volatility.
Geographical Allocation
-----------------------
(as a percentage of net assets)
Brazil 18.8%
United States 17.2%
Portugal 8.9%
Mexico 8.0%
South Africa 7.0%
Egypt 5.1%
Hungary 4.5%
Israel 4.3%
Hong Kong 3.7%
Argentina 3.7%
India 2.7%
Greece 2.6%
Spain 2.5%
Other countries 11.0%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
What were your principal strategies during the period?
Our largest single country weighting has been in Brazil, which was at 18.8%
of net assets at the end of the period. While we want to take advantage of
opportunities from privatization in Brazil, there continues to be concern
about the Brazilian currency and internal political issues. We also have a
fair representation in Mexico, where valuations are reasonable.
Our largest regional weighting has been in the Europe, Middle East and
Africa (EMEA) region, which combined accounted for 44.1% of net assets at
the close of the period. We have just started investing in Israel, where
there are particularly attractive opportunities among technology companies.
By industry, we have concentrated on fairly defensive areas within the
context of investing in emerging markets. As a result, telecommunications
companies account for the largest portion at 16.3% of net assets, followed
3
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
by finance & insurance (12.4%), food and beverage products (7.4%) building
materials and construction (6.9%), and diversified companies (5.8%).
We do not hedge currency in the Evergreen Emerging Markets Fund because we
consider the currency outlook as a major factor when deciding whether to
invest in a country or region. If there were a major risk of devaluation,
we would prefer to pass on that equity market. The uncertain currency
outlook is one reason the Fund's Asian emphasis remains low, at 9.5% at the
close of the fiscal period.
Top 10 Holdings
---------------
(as a percentage of net assets)
Liberty Life Association of Africa, Ltd. 3.5%
Companhia Riograndense de Telecomunica 3.5%
Rembrandt Group Ltd. 2.7%
Transportadora de Gas del Sur SA, ADR ("TGS") 2.6%
Campofrio Alimentacion SA 2.5%
Banco Comercial Portugues SA, ADR 2.2%
Telecomunicaoes de Sao Paulo SA 2.1%
Portugal Telecom SA, ADR 2.0%
Companhia Energetica de Minas Gerais,
ADR ("CEMIG") 1.9%
Teva Pharmaceutical Industries, Ltd., ADR 1.9%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
What were some of the companies that helped performance?
The Fund's largest holding, Liberty Life of South Africa, has been a very
strong contributor to performance. While its principal business is life
insurance, the company also has significant investments in South African
industrial companies. The company has benefited from re-structuring in the
life insurance industry, in which it is a dominant factor. It also has been
selling some of its industrial investments. We believe the company, whose
stock has been inexpensive, has very strong growth potential.
Another interesting investment is Bank Hapoalim of Israel. One of the
dominant financial institutions in Israel, Bank Hapoalim has had a change
in ownership within the past year. It now is controlled by a group led by
Abran Harel, the chief executive of Carnival Cruise Lines. We believe this
is a good quality company selling at a very cheap price that should do very
well with new owners.
Top 5 Industries
----------------
(as a percentage of net assets)
Telecommunications Services & Equipment 16.3%
Finance & Insurance 12.4%
Food & Beverage Products 7.4%
Building, Construction & Furnishings 6.9%
Diversified Companies 5.8%
- --------------------------------------------------------------------------------
What is your outlook?
We expect continued volatility in the emerging markets, and we will take a
prudent, low-risk approach. In particular, we expect the economic problems
in Asia to continue, so we will be particularly cautious there.
In general, we expect to be focusing on the emerging markets in Europe, the
Middle East and Africa. We also will be looking at special situations in
Latin America, particularly in opportunities from privatization of former
public enterprises in Brazil.
4
<PAGE>
EVERGREEN
Global Leaders Fund
Fund at a Glance as of April 30, 1998
We had a continuance of the strong fundamental backdrop for equity investing
from both domestic and most foreign markets.
Portfolio
Management
----------------------------------------
(Photo of Stephen A. Lieber)
Stephen A. Lieber
Tenure: November 1995
(Photo of Edwin D. Miska)
Edwin D. Miska
Tenure: November 1995
-------------------------------------------------------
CURRENT INVESTMENT STYLE
Morningstar's Style Box is based on a
portfolio date as of 3/31/98.
(Graphic) The Equity Style Box placement is based on a
fund's price-to-earnings and price-to-book
ratio relative to the S&P 500, as well as the
size of the companies in which it invests, or
median market capitalization.
Source: 1998 Morningstar, Inc.
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS*
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Class A Class B Class C Class Y
Inception Date 6/3/96 6/3/96 6/3/96 11/1/95
........................................................................
Average Annual Returns
........................................................................
6 months with sales charge 11.60% 11.76% 15.70% n/a
........................................................................
6 months w/o sales charge 17.17% 16.76% 16.70% 17.26%
........................................................................
1 year with sales charge 21.85% 22.00% 25.94% n/a
........................................................................
1 year w/o sales charge 27.93% 27.00% 26.94% 28.20%
........................................................................
Since Inception 17.13% 17.45% 19.17% 21.16%
........................................................................
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
........................................................................
6-month capital gain
distributions per share $ 0.06 $ 0.06 $ 0.06 $ 0.06
</TABLE>
*Adjusted for maximum sales charge.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
[Performance Graph appears here with the following plot points]
<TABLE>
<CAPTION>
<S> <C>
6/96 7/96 10/96 1/97 4/97 7/97 10/97 1/98 4/98
Class A Shares 9,525 9,331 10,048 10,505 10,573 12,303 11,543 12,058 13,525
MSCIWI 10,000 9,699 10,271 10,807 11,071 12,915 12,043 12,757 14,340
CPI 10,000 10,030 10,116 10,167 10,237 10,257 10,327 10,327 10,384
</TABLE>
Comparison of a $10,000 investment in Evergreen Global Leaders Fund, Class A
Shares, versus a similiar investment in the Morgan Stanley Capital International
World Index (MSCIWI) and the Consumer Price Index (CPI).
Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads and fees paid by the shareholders
investing in each class. The investment return and principal value will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than original cost. The Morgan Stanley Capital International World Index is an
unmanaged index and does not include transaction costs associated with buying
and selling securities nor any management fees. The Consumer Price Index is a
commonly used measure of inflation and does not represent an investment return.
It is not possible to invest directly in an index.
5
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
- --------------------------------------------------------------------------------
How did the Fund perform during the six-month period?
The Evergreen Global Leaders Fund performed well. For the six-month period
ending April 30, 1998, the Fund's Class A shares had a return of 17.17%
while Class B and C Class shares had returns of 16.76% and 16.70%,
respectively. These returns are unadjusted for sales charge. The Fund's
Class Y shares had a return of 17.26% for the six months. These returns
were in line with the strong performance of the world equity markets, as
evidenced by the 18.10% return of the Morgan Stanley Capital International
World Stock Index and the 16.65% return for the Lipper Global Funds average
for the same six-month period. For the 12-month period, the Fund's Class Y
shares returned 28.20%, compared to the 27.18% return of the Lipper Global
Funds average. The healthy performance was helped both by stock selection
and by country allocation strategies, which emphasized improving economies
and de-emphasized trouble areas, most notably Asia.
Portfolio Characteristics
-------------------------
Total Net Assets $319,187,986
Number of Holdings 148
- --------------------------------------------------------------------------------
What was the investment environment like over the six months?
We had a continuance of the strong fundamental backdrop for equity
investing from both domestic and most foreign markets. As a whole, the
world stock markets maintained their bull run, posting an extraordinary
six-month record. The continued resilience of the U.S. economy led the
global markets. Within the U.S., fears of higher interest rates remained
subdued, while consumer demand strengthened, unemployment decreased and
inflationary pressures were virtually non-existent. Internationally, the
economic backdrop has begun to reflect improving fundamentals and corporate
profit growth has begun to accelerate. The increasing earnings of foreign
companies have been aided by a strong export-driven recovery supported by
the strength of the U.S. dollar, which has helped the competitiveness of
the products of foreign companies. At the same time, pessimism appears to
be bottoming in the economies of the "Asian tigers," including Japan,
Malaysia, Thailand and Indonesia. Market forces and government actions have
stimulated the first, slow, painful steps toward the ultimate recovery in
the Pacific Basin. With this as an ideal overall backdrop, 18 of the 24
developed nations in the MSCI World Index had positive returns for the
six-month period, with many in double digits, in local currency terms.
Geographical Allocation
-----------------------
(as a percentage of net assets)
North America 47.1%
Europe 44.9%
Japan 4.6%
Far East 3.4%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
How did the investments in U.S.
companies perform?
The Fund had 33.4% of net assets invested in U.S. companies on April 30,
approximately the same weighting as the 34.5% at the start of the period.
These U.S. investments continued to be performance leaders, up 23.9% for
the six months and 50.7% for 12 months. The Fund has continued to highlight
41 of the top multi-national and industry leaders from the U.S. Thirty-six
of the 41 generated positive performance during the six months, with 19
posting returns of greater than 25%. The top performers continued to be
leading names that have achieved outstanding returns on shareholders'
equity, with consistently outstanding earnings growth over both the
six-month and longer periods. These were from a variety of industry groups.
6
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
Top 10 Holdings
---------------
(as a percentage of net assets)
RWE -- AG 2.6%
Seven-Eleven Japan Co., Ltd. 2.4%
SAP AG 2.2%
Bombardier, Inc., Cl. B 2.0%
Nintendo Co., Ltd. 2.0%
General Electric Co. 1.8%
Hugo Boss AG 1.8%
Ems-Chemie Holding AG 1.8%
Benetton Group SpA, ADS 1.7%
Microsoft Corp. 1.6%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
What were some of the standout
performers among U.S. companies?
Among the best-performing, technology-related companies were Parametric
Technology, up 47.6% and Microsoft Corp., up 39.7%. In the retail
industries, the Gap, Inc., had a 44.8% return while Wal-Mart Stores, Inc.,
had a return of 44.1%. Among consumer products and services, Walt Disney
Co. had a 50.9% return and Carnival Corp. had a 43.1% return. In the
healthcare industry, the investment in Schering-Plough Corp., had a 42.7%
return while Merck & Co. had a return of 34.7%.
During the six months, the Fund made new commitments to investments in the
Tribune Co., Maytag Corp., TRW Inc. and Campbell Soup Co. At the same time,
the Fund realized a gain of 47.9% on sales of shares of Dover Corp. The
merger-and-acquisition trend also continued to help performance. Shares of
Dresser Industries rose 26.2% on news of a merger offer from Halliburton
Corp.
- --------------------------------------------------------------------------------
How did the Fund's international investments do?
The Fund's investments in foreign companies posted a solid 14.35% return
for the six months and 19.91% for the 12 months. At the close of the fiscal
period on April 30, 57.7% of Fund assets were invested in non-U.S.
companies, illustrating our enthusiasm for foreign stocks, especially those
of European companies. Investments in European companies posted the
strongest returns, reflecting solid economic gains, low inflation, rising
productivity and profits, falling national deficits, and the surges of
investment assets into European equity markets. These trends were reflected
in the very strong performance of holdings from a number of European
companies. Investments in Italy had a leading 35.7% gain; followed by
investments in Belgium, up 30.0%; Sweden, up 27.7%; France, up 26.4%;
Germany, up 25.3%; Spain, up 23.8%; and the United Kingdom, up 18.3%.
- --------------------------------------------------------------------------------
What were some of the best-performing international stocks?
The outstanding performers were based in Europe. Among the leading issues
were: Vodafone Group Plc, a mobile phone operator in the United Kingdom, up
99.7%; SAP AG, a German software company, up 65.2%; Rentokil Group, the
global industrial services giant based in the United Kingdom, which had a
return of 59.4%; Italian apparel retailer Benneton Group SpA ADS, up 51.4%;
Sodexho Alliance, a food services corporation based in France, up 46.6%;
Legal and General Group, an insurer based in the United Kingdom, up 44.2%;
and VNU, the Dutch publishing and broadcasting giant, which had a return of
42.3%. Other strong performers included: UCB SA, a Belgium-based
pharmaceutical company, with a 38.4% return; specialty instruments firm
Barco NV of Belgium, up 38.2%; and eyeglass frame manufacturer and retailer
Luxottica Group SpA ADS of Italy, up 35.9%. French auto seat manufacturer
Bertrand Faure was the beneficiary of a takeover offer from ECIA and netted
the Fund a realized gain of 28%.
7
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
Several Canadian investments also were strong contributors to performance.
The investment in Bombardier returned 41.0%, Dupont Canada returned 26.3%
and the Fund's investment in Magna International, an auto parts
manufacturer, had a 13.5% return since the Fund's investment in September
1997.
Top 5 Industries
----------------
(as a percentage of net assets)
Information Services & Technology 10.1%
Healthcare Products & Services 9.8%
Retailing & Wholesale 8.3%
Food & Beverage Products 5.9%
Consumer Products & Services 5.9%
- --------------------------------------------------------------------------------
How did the Asian investments do?
It was a challenge to get positive returns from Asian investments, as the
region's poor economic fundamentals outweighed the investment merits of
outstanding individual companies. The Fund de-emphasized Asia in asset
allocation during the period, lowering its overall weight to 8.0% in the
current period, down from 12.2% at the previous fiscal year end. Of the
investments that were held, those based in Hong Kong fell by 10.9% while
those in Malaysia fell by 6.4% and those in Japan fell by 4.2%.
- --------------------------------------------------------------------------------
What do you expect to be your strategy looking forward?
We expect to maintain the investment disciplines outlined in previous
reports. Our strategy is to use careful stock selection through a strong
quantitative, fundamental and valuation review, coupled with an active
discipline to sell issues that no longer meet our investment criteria. We
believe superior long-term performance can be achieved by investments in
companies that consistently demonstrate sustained and visible profit growth
in any economic environment and that can be purchased at attractive
valuations. We intend to remain pro-active in identifying and investing in
these companies in the context of changing global macro-economic, political
and social conditions. We have been encouraged by the results during the
six months of the period. While we recognize that achieving outstanding
absolute results may be more challenging in a more subdued economic
environment, we remain confident about prospects both domestically and
abroad for the remainder of the year.
8
<PAGE>
EVERGREEN
International Equity Fund
Fund at a Glance as of April 30, 1998
The major area of strength for the Fund, and for international funds in general,
was Europe.
Portfolio
Management
----------------------------------------
(Photo of David C. Francis, CFA)
David C. Francis, CFA
Tenure: January 1998
-------------------------------------------------------
CURRENT INVESTMENT STYLE
Morningstar's Style Box is based on a
portfolio date as of 3/31/98.
(Graphic)
The Equity Style Box placement is based on a
fund's price-to-earnings and price-to-book
ratio relative to the S&P 500, as well as
the size of the companies in which it
invests, or median market capitalization.
Source: 1998 Morningstar, Inc.
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS*
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Class A Class B Class C Class Y
Inception Date 9/2/94 9/2/94 9/2/94 9/2/94
........................................................................
Average Annual Returns
........................................................................
6 months with sales charge 5.16% 4.98% 9.01% n/a
........................................................................
6 months w/o sales charge 10.40% 9.98% 10.01% 10.45%
........................................................................
1 year with sales charge 5.54% 4.88% 8.91% n/a
........................................................................
1 year w/o sales charge 10.80% 9.88% 9.91% 10.95%
........................................................................
3 years 6.92% 7.01% 7.88% 8.95%
........................................................................
Since Inception 4.94% 4.90% 5.65% 6.59%
........................................................................
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
........................................................................
6-month income dividends
per share $ 0.24 $ 0.19 $ 0.19 $ 0.27
........................................................................
</TABLE>
*Adjusted for maximum sales charge.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
[Performance Graph appears here with the following plot points]
<TABLE>
<CAPTION>
<S> <C>
9/94 10/94 4/95 10/95 4/96 10/96 4/97 10/97 4/98
Class A Shares 9,525 9,525 9,299 9,137 10,419 10,042 10,767 10,817 11,931
MSEAFEI 10,000 10,012 10,152 10,005 11,344 11,086 11,276 11,631 13,445
CPI 10,000 10,034 10,195 10,315 10,481 10,624 10,752 10,846 10,906
</TABLE>
Comparison of a $10,000 investment in Evergreen International Equity Fund, Class
A shares, versus a similar investment in the Morgan Stanley Europe, Australia,
and Far East Index (MSEAFEI) and the Consumer Price Index (CPI).
Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads and fees paid by the shareholders
investing in each class. The investment return and principal value will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than original cost. The MSEAFE Index is an unmanaged index and does not include
transaction costs associated with buying and selling securities nor any
management fees. The Consumer Price Index is a commonly used measure of
inflation and does not represent an investment return. It is not possible to
invest directly in an index.
9
<PAGE>
EVERGREEN
International Equity Fund
Portfolio Manager Interview
- --------------------------------------------------------------------------------
How did the Fund perform during the six-month period?
The Fund's Class A shares gained 10.40% over the six months ended April 30,
unadjusted for sales charge, vs. a gain of 15.43% for the Morgan Stanley
Capital International Europe, Australia and Far East ("EAFE") Index for the
same period.
Portfolio Characteristics
-------------------------
Total Net Assets $294,357,388
Number of Holdings 127
- --------------------------------------------------------------------------------
Why did the Fund underperform its benchmark?
Most, if not all, of the Fund's underperformance against the EAFE Index is
attributable to its Asian exposure. Heading into the reporting period, the
Fund was overweighted in Asia relative to the index. Although this
overweighting was relatively small, it cost the Fund dearly in terms of
performance, given the magnitude by which these markets fell at the end of
1997. The Fund was also hurt, in relative terms, by its exposure to Latin
America, which is not represented in the EAFE Index. Latin American markets
sold off in the wake of the Asian crisis and any exposure to the region was
a liability.
Top 10 Holdings
---------------
(as a percentage of net assets)
Philips Electronics NV 2.5%
ING Groep NV 2.0%
Rhone-Poulenc SA, Cl. A 2.0%
Julius Baer Holding AG 2.0%
Williams Holding Plc 1.8%
Nordbanken Holding 1.7%
YPF SA, ADR 1.6%
Societe Genrlae d'Enterprises SA 1.6%
Societe Nationale Elf Aquitaine SA 1.6%
Electrolux AB, Ser. B 1.6%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
What helped the Fund's performance during the period?
The major area of strength for the Fund, and for international funds in
general, was Europe. These markets rallied strongly through the six-month
period, benefiting from a host of factors: optimism toward the prospects
for European Monetary Union; strengthening economic growth and improved
corporate profits; falling interest rates and low inflation; corporate
restructurings; and merger and acquisition activity. The Fund's European
holdings showed near-universal strength over the period, and a number of
its holdings rose sharply.
Top 5 Industries
----------------
(as a percentage of net assets)
Finance & Insurance 17.1%
Banks 8.8%
Diversified Companies 7.9%
Consumer Products & Services 7.8%
Healthcare Products & Services 6.9%
10
<PAGE>
EVERGREEN
International Equity Fund
Portfolio Manager Interview
- --------------------------------------------------------------------------------
Were there any changes in strategy during the six months?
Yes, in terms of geographical allocations. The Fund scaled back its Asian
exposure fairly significantly over the course of the six months, and
reallocated the proceeds to Europe. This reflected our view that European
markets, in general, represented better opportunity than markets in Asia,
especially from a risk-adjusted perspective, given the fundamentals at play
in the respective regions.
Geographical Allocation
-----------------------
(as a percentage of net assets)
Europe 68.7%
Americas 11.6%
Japan 10.6%
Far East 5.6%
Middle East/Africa 1.8%
Australia 1.7%
Portfolio composition subject to change.
- --------------------------------------------------------------------------------
What is your outlook for the remainder of 1998 and beyond?
We believe there are some excellent opportunities in non-U.S. markets at
present, and remain very optimistic regarding the potential for the asset
class. European markets continue to benefit from a strong tailwind, and it
is still possible to find very attractively valued stocks, despite these
markets' sizable recent gains. Asian markets have a far more troubled
backdrop, and the situation is unlikely to improve markedly for at least
the next six months, and probably longer. Still, there are some good
opportunities on a stock-specific basis, companies whose fortunes stand to
rise despite the general malaise afflicting the region. The same holds for
Latin America. All told, we continue to believe a careful, research-
intensive approach to overseas markets stands to lead to very attractive
returns for risk-tolerant investors, and we look forward to the coming
months.
11
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------
Six Months Ended
April 30, 1998#
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS A SHARES
Net asset value beginning of period $ 9.99 $ 8.46 $ 7.90 $ 8.17
========= ========= ========= ==========
Income (loss) from investment operations
Net investment income (loss) 0.10 0 (0.01) 0.05
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions 0.91 1.53 0.62 (0.32)
--------- --------- --------- ----------
Total from investment operations 1.01 1.53 0.61 (0.27)
--------- --------- --------- ----------
Less distributions
From net investment income 0 0 (0.05) 0
From net realized gain on investments and foreign
currency related transactions (0.25) 0 0 0
--------- --------- --------- ----------
Total distributions (0.25) 0 (0.05) 0
--------- --------- --------- ----------
Net asset value end of period $ 10.75 $ 9.99 $ 8.46 $ 7.90
========= ========= ========= ==========
Total Return + 10.36% 18.09% 7.70% (3.30%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.75%++ 1.75% 1.74% 1.73%++
Total expenses, excluding indirectly paid expenses 1.74%++ 1.74% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.17%++ 2.26% 3.58% 3.97%++
Net investment income (loss) 1.97%++ (0.02%) (0.09%) 0.76%++
Portfolio turnover rate 120% 157% 107% 65%
Average commission rate per share $ 0.0013 $ 0.0019 $ 0.0103 N/A
Net assets end of period (thousands) $ 6,556 $ 2,777 $ 1,645 $ 1,117
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS A SHARES
Net asset value beginning of period $ 10.00
===========
Income (loss) from investment operations
Net investment income (loss) 0
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions (1.83)
-----------
Total from investment operations (1.83)
-----------
Less distributions
From net investment income 0
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 8.17
===========
Total Return + (18.30%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.78%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 3.96%++
Net investment income (loss) (0.12%)++
Portfolio turnover rate 17%
Average commission rate per share N/A
Net assets end of period (thousands) $ 867
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------
Six Months Ended
April 30, 1998#
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS B SHARES
Net asset value beginning of period $ 9.85 $ 8.39 $ 7.85 $ 8.16
========= ========= ========= ==========
Income (loss) from investment operations
Net investment income (loss) 0.05 (0.08) (0.08) 0.01
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions 0.93 1.54 0.62 (0.32)
--------- --------- --------- ----------
Total from investment operations 0.98 1.46 0.54 (0.31)
--------- --------- --------- ----------
Less distributions
From net realized gain on investments and foreign
currency related transactions (0.25) 0 0 0
--------- --------- --------- ----------
Total distributions (0.25) 0 0 0
--------- --------- --------- ----------
Net asset value end of period $ 10.58 $ 9.85 $ 8.39 $ 7.85
--------- --------- --------- ----------
Total Return + 10.10% 17.40% 6.90% (3.80%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.50%++ 2.50% 2.50% 2.48%++
Total expenses, excluding indirectly paid expenses 2.49%++ 2.49% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.91%++ 3.00% 4.34% 4.72%++
Net investment income (loss) 1.07%++ (0.79%) (0.87%) 0.03%++
Portfolio turnover rate 120% 157% 107% 65%
Average commission rate per share $ 0.0013 $ 0.0019 $ 0.0103 N/A
Net assets end of period (thousands) $ 4,471 $ 4,020 $ 2,881 $ 1,940
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS B SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income (loss) (0.02)
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions (1.82)
-----------
Total from investment operations (1.84)
-----------
Less distributions
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 8.16
-----------
Total Return + (18.40%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.53%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 4.71%++
Net investment income (loss) (0.84%)++
Portfolio turnover rate 17%
Average commission rate per share N/A
Net assets end of period (thousands) $ 1,589
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from September 6, 1994 (commencement of class operations) to
December 31, 1994.
** The Fund changed its year end from December 31 to October 31, effective
October 31, 1995.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
12
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------
Six Months Ended
April 30,1998#
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS C SHARES
Net asset value beginning of period $ 9.85 $ 8.38 $ 7.84 $ 8.16
--------- --------- --------- ----------
Income (loss) from investment operations
Net investment income (loss) 0.04 (0.06) (0.08) 0.02
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions 0.93 1.53 0.62 (0.34)
--------- --------- --------- ----------
Total from investment operations 0.97 1.47 0.54 (0.32)
--------- --------- --------- ----------
Less distributions
From net realized gain on investments and foreign
currency related transactions (0.25) 0 0 0
--------- --------- --------- ----------
Total distributions (0.25) 0 0 0
--------- --------- --------- ----------
Net asset value end of period $ 10.57 $ 9.85 $ 8.38 $ 7.84
--------- --------- --------- ----------
Total Return + 10.11% 17.50% 6.90% (3.90%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.50%++ 2.50% 2.51% 2.50%++
Total expenses, excluding indirectly paid expenses 2.49%++ 2.49% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.91%++ 3.01% 4.31% 4.74%++
Net investment income (loss) 0.77%++ (0.61%) (0.91%) 0.72%++
Portfolio turnover rate 120% 157% 107% 65%
Average commission rate per share $ 0.0013 $ 0.0019 $ 0.0103 N/A
Net assets end of period (thousands) $ 664 $ 1,282 $ 85 $ 56
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS C SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income (loss) (0.02)
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions (1.82)
-----------
Total from investment operations (1.84)
-----------
Less distributions
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 8.16
-----------
Total Return + (18.40%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.53%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 4.71%++
Net investment income (loss) (0.82%)++
Portfolio turnover rate 17%
Average commission rate per share N/A
Net assets end of period (thousands) $ 89
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------
Six Months Ended
April 30, 1998#
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value beginning of period $ 10.04 $ 8.48 $ 7.92 $ 8.17
---------- ----------- ----------- ----------
Income (loss) from investment operations
Net investment income 0.10 0.03 0.01 0.05
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions 0.93 1.53 0.62 (0.30)
---------- ----------- ----------- ----------
Total from investment operations 1.03 1.56 0.63 (0.25)
---------- ----------- ----------- ----------
Less distributions
From net investment income (0.01) 0 (0.07) 0
From net realized gain on investments and foreign
currency related transactions (0.25) 0 0 0
---------- ----------- ----------- ----------
Total distributions (0.26) 0 (0.07) 0
---------- ----------- ----------- ----------
Net asset value end of period $ 10.81 $ 10.04 $ 8.48 $ 7.92
---------- ----------- ----------- ----------
Total Return 10.40% 18.40% 7.90% (3.10%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.50%++ 1.50% 1.50% 1.48%++
Total expenses, excluding indirectly paid expenses 1.49%++ 1.49% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 1.91%++ 2.01% 3.27% 3.72%++
Net investment income 2.00%++ 0.25% 0.11% 0.94%++
Portfolio turnover rate 120% 157% 107% 65%
Average commission rate per share $ 0.0013 $ 0.0019 $ 0.0103 N/A
Net assets end of period (thousands) $ 68,017 $ 61,142 $ 28,959 $ 9,355
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS Y SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income 0.01
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions (1.84)
-----------
Total from investment operations (1.83)
-----------
Less distributions
From net investment income 0
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 8.17
-----------
Total Return (18.30%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.53%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 3.71%++
Net investment income 0.43%++
Portfolio turnover rate 17%
Average commission rate per share N/A
Net assets end of period (thousands) $ 5,878
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from September 6, 1994 (commencement of class operations) to
December 31, 1994.
** The Fund changed its year end from December 31 to October 31, effective
October 31, 1995.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
13
<PAGE>
EVERGREEN
Global Leaders Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------
(Unaudited) 1997# 1996*#
<S> <C> <C> <C>
CLASS A SHARES
Net asset value beginning of period $ 13.67 $ 11.91 $ 11.29
------------- ----------- ------------
Income (loss) from investment operations
Net investment income (loss) (0.04) (0.01) 0
Net realized and unrealized gain on investments and foreign
currency related transactions 2.38 1.78 0.62
------------- ----------- ------------
Total from investment operations 2.34 1.77 0.62
------------- ----------- ------------
Less distributions
From net realized gain on investments and foreign currency
related transactions (0.06) (0.01) 0
------------- ----------- ------------
Total distributions (0.06) (0.01) 0
------------- ----------- ------------
Net asset value end of period $ 15.95 $ 13.67 $ 11.91
------------- ----------- ------------
Total Return + 17.17% 14.88% 5.50%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.00%++ 1.91% 1.75%++
Total expenses, excluding indirectly paid expenses 2.00%++ 1.90% N/A
Total expenses, excluding fee waivers & expense
reimbursements N/A 1.98% 2.16%++
Net investment income (loss) (0.51%)++ (0.05%) 0.10%++
Portfolio turnover rate 6% 29% 20%
Average commission rate per share $ 0.0307 $ 0.0418 $ 0.0659
Net assets end of period (thousands) $ 105,010 $ 38,604 $ 12,975
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ------------------------------------
(Unaudited) 1997# 1996*#
<S> <C> <C> <C>
CLASS B SHARES
Net asset value beginning of period $ 13.52 $ 11.87 $ 11.29
------------- ----------- ------------
Income (loss) from investment operations
Net investment loss (0.10) (0.11) (0.02)
Net realized and unrealized gain on investments and foreign
currency related transactions 2.36 1.77 0.60
------------- ----------- ------------
Total from investment operations 2.26 1.66 0.58
------------- ----------- ------------
Less distributions
From net realized gain on investments and foreign currency
related transactions (0.06) (0.01) 0
------------- ----------- ------------
Total distributions (0.06) (0.01) 0
------------- ----------- ------------
Net asset value end of period $ 15.72 $ 13.52 $ 11.87
------------- ----------- ------------
Total Return + 16.76% 14.01% 5.10%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.75%++ 2.66% 2.50%++
Total expenses, excluding indirectly paid expenses 2.75%++ 2.66% N/A
Total expenses, excluding fee waivers & expense
reimbursements N/A 2.74% 2.93%++
Net investment loss (1.46%)++ (0.83%) (0.68%)++
Portfolio turnover rate 6% 29% 20%
Average commission rate per share $ 0.0307 $ 0.0418 $ 0.0659
Net assets end of period (thousands) $ 166,125 $ 134,375 $ 41,948+
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from June 3, 1996 (commencement of class operations) to
October 31, 1996.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
14
<PAGE>
EVERGREEN
Global Leaders Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ------------------------------------
(Unaudited) 1997# 1996*#
<S> <C> <C> <C>
CLASS C SHARES
Net asset value beginning of period $ 13.51 $ 11.86 $ 11.29
------------- ----------- ------------
Income (loss) from investment operations
Net investment loss (0.10) (0.11) (0.02)
Net realized and unrealized gain on investments and foreign
currency related transactions 2.34 1.77 0.59
------------- ----------- ------------
Total from investment operations 2.24 1.66 0.57
------------- ----------- ------------
Less distributions
From net realized gain on investments and foreign currency
related transactions (0.06) (0.01) 0
------------- ----------- ------------
Total distributions (0.06) (0.01) 0
------------- ----------- ------------
Net asset value end of period $ 15.69 $ 13.51 $ 11.86
------------- ----------- ------------
Total Return + 16.70% 14.02% 5.00%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.75%++ 2.65% 2.50%++
Total expenses, excluding indirectly paid expenses 2.75%++ 2.65% N/A
Total expenses, excluding fee waivers & expense
reimbursements N/A 2.70% 2.93%++
Net investment loss (1.43%)++ (0.80%) (0.67%)++
Portfolio turnover rate 6% 29% 20%
Average commission rate per share $ 0.0307 $ 0.0418 $ 0.0659
Net assets end of period (thousands) $ 3,535 $ 2,386 $ 554
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------
(Unaudited) 1997# 1996*#
<S> <C> <C> <C>
CLASS Y SHARES
Net asset value beginning of period $ 13.71 $ 11.91 $ 10.00
------------- ------------- ------------
Income (loss) from investment operations
Net investment income (loss) (0.03) 0.03 0.07
Net realized and unrealized gain on investments and foreign
currency related transactions 2.39 1.78 1.88
------------- ------------- ------------
Total from investment operations 2.36 1.81 1.95
------------- ------------- ------------
Less distributions
From net investment income 0 0 (0.04)
From net realized gain on investments and foreign currency
related transactions (0.06) (0.01) 0
------------- ------------- ------------
Total distributions (0.06) (0.01) (0.04)
------------- ------------- ------------
Net asset value end of period $ 16.01 $ 13.71 $ 11.91
------------- ------------- ------------
Total Return 17.26% 15.22% 19.60%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.75%++ 1.64% 1.47%++
Total expenses, excluding indirectly paid expenses 1.75%++ 1.64% N/A
Total expenses, excluding fee waivers & expense
reimbursements N/A 1.72% 2.51%++
Net investment income (loss) (0.60%)++ 0.23% 0.62%++
Portfolio turnover rate 6% 29% 20%
Average commission rate per share $ .0307 $ 0.0418 $ 0.0659
Net assets end of period (thousands) $ 44,518 $ 35,461 $ 18,607
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from June 3, 1996 (commencement of class operations) to
October 31, 1996.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
15
<PAGE>
EVERGREEN
International Equity Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------------------
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS A SHARES
Net asset value beginning of period $ 11.07 $ 10.43 $ 9.58 $ 9.50
---------- ------------ ----------- ----------
Income from investment operations
Net investment income 0.05 0.07 0.17 0.09
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions 1.01 0.72 0.78 0
---------- ------------ ----------- ----------
Total from investment operations 1.06 0.79 0.95 0.09
---------- ------------ ----------- ----------
Less distributions
From net investment income (0.24) (0.15) (0.10) (0.01)
From net realized gain on investments and foreign
currency related transactions (0.50) 0 0 0
---------- ------------ ----------- ----------
Total distributions (0.74) (0.15) (0.10) (0.01)
---------- ------------ ----------- ----------
Net asset value end of period $ 11.39 $ 11.07 $ 10.43 $ 9.58
---------- ------------ ----------- ----------
Total Return + 10.40% 7.62% 9.90% 1.10%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.31%++ 1.25% 1.24% 1.19%++
Total expenses, excluding indirectly paid expenses 1.30%++ 1.24% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 1.32%++ 1.36% 1.66% 1.84%++
Net investment income 0.89%++ 0.70% 1.65% 1.38%++
Portfolio turnover rate 47% 86% 113% 4%
Average commission rate per share $ 0.0154 $ 0.0187 $ 0.0068 N/A
Net assets end of period (thousands) $ 12,911 $ 9,270 $ 7,234 $ 3,594
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS A SHARES
Net asset value beginning of period $ 10.00
-----------
Income from investment operations
Net investment income 0.02
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions (0.52)
-----------
Total from investment operations (0.50)
-----------
Less distributions
From net investment income 0
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 9.50
-----------
Total Return + (5.10%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.26%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.09%++
Net investment income 0.91%++
Portfolio turnover rate 1%
Average commission rate per share N/A
Net assets end of period (thousands) $ 2,545
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------------------
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS B SHARES
Net asset value beginning of period $ 10.99 $ 10.37 $ 9.53 $ 9.50
---------- ---------- ---------- ----------
Income (loss) from investment operations
Net investment income (loss) 0.01 0 0.11 0.06
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions 1.00 0.70 0.76 (0.03)
---------- ---------- ---------- ----------
Total from investment operations 1.01 0.70 0.87 0.03
---------- ---------- ---------- ----------
Less distributions
From net investment income (0.19) (0.08) (0.03) 0
From net realized gain on investments and foreign
currency related transactions (0.50) 0 0 0
---------- ---------- ---------- ----------
Total distributions (0.69) (0.08) (0.03) 0
---------- ---------- ---------- ----------
Net asset value end of period $ 11.31 $ 10.99 $ 10.37 $ 9.53
---------- ---------- ---------- ----------
Total Return+ 9.98% 6.79% 9.20% 0.50%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.06%++ 2.00% 2.00% 1.94%++
Total expenses, excluding indirectly paid expenses 2.05%++ 2.00% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.07%++ 2.11% 2.42% 2.59%++
Net investment income 0.11%++ (0.05%) 1.05% 0.66%++
Portfolio turnover rate 47% 86% 113% 4%
Average commission rate per share $ 0.0154 $ 0.0187 $ 0.0068 N/A
Net assets end of period (thousands) $ 23,519 $ 22,164 $ 14,110 $ 7,278
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS B SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income (loss) 0
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions (0.50)
-----------
Total from investment operations (0.50)
-----------
Less distributions
From net investment income 0
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 9.50
-----------
Total Return+ (5.20%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.02%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.85%++
Net investment income 0.10%++
Portfolio turnover rate 1%
Average commission rate per share N/A
Net assets end of period (thousands) $ 5,602
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from September 2, 1994 (commencement of operations) to
December 31, 1994.
** The Fund changed its year end from December 31 to October 31, effective
October 31, 1995.
# Net investment income is based on average monthly shares outstanding for the
periods indicated.
See Combined Notes to Financial Statements.
16
<PAGE>
EVERGREEN
International Equity Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------------------
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS C SHARES
Net asset value beginning of period $ 11.05 $ 10.41 $ 9.53 $ 9.49
----------- ---------- ----------- ----------
Income (loss) from investment operations
Net investment income (loss) 0.01 (0.01) 0.12 0.08
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions 1.01 0.71 0.76 (0.04)
----------- ---------- ----------- ----------
Total from investment operations 1.02 0.70 0.88 0.04
----------- ---------- ----------- ----------
Less distributions
From net investment income (0.19) (0.06) 0(a) 0
From net realized gain on investments and foreign
currency related transactions (0.50) 0 0 0
----------- ---------- ----------- ----------
Total distributions (0.69) (0.06) 0 0
----------- ---------- ----------- ----------
Net asset value end of period $ 11.38 $ 11.05 $ 10.41 $ 9.53
----------- ---------- ----------- ----------
Total Return + 10.01% 6.80% 9.30% 0.50%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.06%++ 2.00% 1.99% 1.94%++
Total expenses, excluding indirectly paid expenses 2.05%++ 1.99% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.07%++ 2.11% 2.43% 2.59%++
Net investment income (loss) 0.19%++ (0.06%) 1.16% 0.79%++
Portfolio turnover rate 47% 86% 113% 4%
Average commission rate per share $ 0.0154 $ 0.0187 $ 0.0068 N/A
Net assets end of period (thousands) $ 594 $ 429 $ 188 $ 196
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS C SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income (loss) 0.03
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions (0.54)
-----------
Total from investment operations (0.51)
-----------
Less distributions
From net investment income 0
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions 0
-----------
Net asset value end of period $ 9.49
-----------
Total Return + (5.20%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 2.01%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 2.84%++
Net investment income (loss) 0.85%++
Portfolio turnover rate 1%
Average commission rate per share N/A
Net assets end of period (thousands) $ 163
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended Year Ended October 31,
April 30, 1998# ----------------------------------------------
(Unaudited) 1997# 1996# 1995**
<S> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value beginning of period $ 11.11 $ 10.46 $ 9.60 $ 9.50
---------- ------------ ----------- ----------
Income (loss) from investment operations
Net investment income 0.06 0.10 0.20 0.08
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions 1.01 0.72 0.78 0.03
---------- ------------ ----------- ----------
Total from investment operations 1.07 0.82 0.98 0.11
---------- ------------ ----------- ----------
Less distributions
From net investment income (0.27) (0.17) (0.12) (0.01)
From net realized gain on investments and foreign
currency related transactions (0.50) 0 0 0
---------- ------------ ----------- ----------
Total distributions (0.77) (0.17) (0.12) (0.01)
---------- ------------ ----------- ----------
Net asset value end of period $ 11.41 $ 11.11 $ 10.46 $ 9.60
---------- ------------ ----------- ----------
Total Return 10.45% 7.90% 10.30% 1.30%
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.06%++ 0.99% 0.99% 0.94%++
Total expenses, excluding indirectly paid expenses 1.04%++ 0.99% N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements 1.07%++ 1.11% 1.41% 1.59%++
Net investment income 1.13%++ 0.96% 1.95% 1.59%++
Portfolio turnover rate 47% 86% 113% 4%
Average commission rate per share $ 0.0154 $ 0.0187 $ 0.0068 N/A
Net assets end of period (thousands) $ 257,333 $ 233,906 $ 124,695 $ 49,575
<CAPTION>
Year Ended
December 31, 1994*
<S> <C>
CLASS Y SHARES
Net asset value beginning of period $ 10.00
-----------
Income (loss) from investment operations
Net investment income 0.02
Net realized and unrealized gain (loss) on
investments and foreign currency related
transactions (0.51)
-----------
Total from investment operations (0.49)
-----------
Less distributions
From net investment income (0.01)
From net realized gain on investments and foreign
currency related transactions 0
-----------
Total distributions (0.01)
-----------
Net asset value end of period $ 9.50
-----------
Total Return (5.00%)
Ratios & Supplemental Data Ratios to average net assets:
Total expenses 1.06%++
Total expenses, excluding indirectly paid expenses N/A
Total expenses, excluding fee waivers & expense
reimbursements 1.89%++
Net investment income 1.03%++
Portfolio turnover rate 1%
Average commission rate per share N/A
Net assets end of period (thousands) $ 23,830
</TABLE>
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from September 2, 1994 (commencement of operations) to
December 31, 1994.
** The Fund changed its year end from December 31 to October 31, effective
October 31, 1995.
# Net investment income is based on average monthly shares outstanding for the
periods indicated.
See Combined Notes to Financial Statements.
17
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- 69.7%
ARGENTINA -- 3.7%
Oil/Energy -- 3.7%
175,925 Transportadora de Gas del Sur
SA, ADR ("TGS") ............ $2,034,133
26,400 YPF SA, ADR ................ 920,700
----------
Total Argentina ............ 2,954,833
==========
BRAZIL -- 7.6%
Electrical Equipment &
Services -- 1.9%
31,300 Companhia Energetica de Minas
Gerais, ADR ("CEMIG") ...... 1,504,782
----------
Finance & Insurance -- 1.1%
22,700 Unibanco Uniao de Barncos
Brasileiras SA, GDR ........ 902,325
----------
Telecommunication Services &
Equipment -- 1.8%
11,800 Telecomunicacoes Brasileiras
SA, ADR ("Telebras") ....... 1,437,388
----------
Utilities -- Electric -- 1.6%
30,100,000 Eletrobras SA .............. 1,237,004
----------
Utilities -- Water -- 1.2%
4,385,000 * Companhia de Saneamento Basico
do Estado ("SABESP") ....... 996,896
----------
Total Brazil ............... 6,078,395
==========
CROATIA -- 0.7%
Pharmaceuticals -- 0.7%
29,800 Pliva D.D., GDR, 144A ...... 539,380
==========
EGYPT -- 5.1%
Building, Construction &
Furnishings -- 1.2%
15,700 Arabian International
Construction ............... 736,657
12,300 Suez Cement Co. ............ 256,100
----------
992,757
----------
Consumer Products &
Services -- 0.6%
19,900 Eastern Tobacco Co. ........ 452,273
----------
Finance & Insurance -- 0.5%
20,750 Commercial International Bank 355,975
----------
Food & Beverage
Products -- 1.6%
35,400 Al-Ahram Beverage Co. SA, GDR 1,125,720
5,600 Al-Ahram Beverage Co. SA, GDR,
144A ....................... 178,080
----------
1,303,800
----------
Healthcare Products &
Services -- 1.2%
13,350 Egyptian International
Pharmaceutical Industries Co. 951,334
----------
Total Egypt ................ 4,056,139
==========
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
GREECE -- 2.6%
Banks -- 1.8%
7,050 Alpha Credit Bank, GDR ..... $ 743,502
7,350 Ergo Bank SA, GDR .......... 692,007
----------
1,435,509
----------
Building, Construction &
Furnishings -- 0.8%
7,430 Titan Cement Co., GDR ...... 635,730
----------
Total Greece ............... 2,071,239
==========
HONG KONG -- 3.7%
Banks -- 0.6%
290,000 Li & Fung Ltd. ............. 486,703
----------
Diversified Companies -- 1.4%
222,000 Citic Pacific Ltd. ......... 682,107
328,000 First Pacific Ltd. ......... 157,733
52,000 Hutchison Whampoa Ltd. ..... 321,559
----------
1,161,399
----------
Food & Beverage
Products -- 0.2%
1,000,000 San Miguel Brewery ......... 165,247
----------
Publishing, Broadcasting &
Entertainment -- 0.7%
212,000 Television Broadcasts Ltd. . 541,905
----------
Telecommunication Services &
Equipment -- 0.4%
83,000 Hong Kong Telecommunications,
Ltd ........................ 155,371
3,500 Hong Kong Telecommunications,
Ltd., ADR .................. 135,187
----------
290,558
----------
Transportation -- 0.4%
172,000 Cathay Pacific Airways ..... 150,994
301,000 Jiangsu Expressway ......... 86,461
340,000 Zhejiang Expressway ........ 82,081
----------
319,536
----------
Total Hong Kong ............ 2,965,348
==========
HUNGARY -- 4.5%
Building, Construction &
Furnishings -- 0.7%
11,150 Zalakeramia RT ............. 560,209
----------
Finance & Insurance -- 0.8%
13,142 OTP Bank RT ................ 622,917
----------
Healthcare Products &
Services -- 2.0%
8,300 EGIS Gyogyszergyar RT ...... 432,753
10,950 Richter Gedeon, GDR ........ 1,172,982
----------
1,605,735
----------
Manufacturing--Distributing -- 0.4%
7,290 Pannonplast RT ............. 309,257
----------
Utilities -- Telephone -- 0.6%
16,200 Matav RT, ADR .............. 477,900
----------
Total Hungary .............. 3,576,018
==========
</TABLE>
18
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
INDIA -- 2.7%
Banks -- 0.5%
22,000 State Bank of India, GDR,
144A ...................... $ 418,000
---------
Building, Construction &
Furnishings -- 0.7%
42,000 Larsen & Toubro Ltd., GDR,
144A ...................... 545,160
---------
Healthcare Products &
Services -- 0.4%
11,400 Ranbaxy Laboratories Ltd.,
GDR, 144A ................. 282,150
---------
Metal Products &
Services -- 0.5%
19,000 Hindalco Industries Ltd.,
GDR, 144A ................. 365,750
---------
Telecommunication Services &
Equipment -- 0.4%
27,000 Videsh Sanchar Nigam Ltd.,
GDR, 144A ................. 330,750
---------
Utilities -- Electric -- 0.2%
12,000 BSES Ltd., GDR, 144A ..... 198,000
---------
Total India .............. 2,139,810
=========
INDONESIA -- 0.1%
Diversified
Companies -- 0.0% (a)
440,000 Bakrie & Brothers ........ 17,875
---------
Healthcare Products &
Services -- 0.1%
310,000 Kalbe Farma .............. 31,969
---------
Publishing, Broadcasting &
Entertainment -- 0.0%
102,250 Modern Photo Film Co. .... 18,213
---------
Total Indonesia .......... 68,057
=========
ISRAEL -- 4.3%
Aerospace & Defense -- 0.3%
19,253 Elbit Systems Ltd. ....... 246,679
---------
Banks -- 0.3%
90,000 Bank Hapoalim Ltd. ....... 241,228
---------
Healthcare Products &
Services -- 1.8%
34,525 Teva Pharmaceutical
Industries
Ltd., ADR ................ 1,475,944
---------
Telecommunication Services &
Equipment -- 1.9%
40,635 ECI Telecommunications Ltd. 1,239,367
5,600 NICE-System Ltd., ADR .... 240,800
---------
1,480,167
---------
Total Israel ............. 3,444,018
=========
MEXICO -- 8.0%
Building, Construction &
Furnishings -- 1.6%
88,650 Apasco SA de CV .......... 602,151
105,300 Cemex SA de CV, Ser. B ... 633,290
---------
1,235,441
---------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Diversified
Companies -- 0.5%
26,950 Grupo Carso SA de CV, Ser.
A1 ....................... $ 169,709
12,800 Grupo Imsa SA de CV, ADR . 244,000
---------
413,709
---------
Finance & Insurance -- 1.9%
346,450 Grupo Finance Banamex Accival
SA de CV, Ser. B ......... 1,082,656
596,800 * Grupo Financiero Bancomer SA
de CV, Ser. B ............ 412,412
---------
1,495,068
---------
Food & Beverage
Products -- 0.6%
68,100 Fomento Economico Mexicano
SA, Ser. B ............... 504,325
---------
Metal Products &
Services -- 0.3%
13,300 * Tubos de Acero de Mexico SA,
ADR ...................... 244,388
---------
Publishing, Broadcasting &
Entertainment -- 0.6%
6,700 * Grupo Televisa SA, ADR ... 274,700
12,600 TV Azteca SA de CV ....... 234,675
---------
509,375
---------
Retailing &
Wholesale -- 1.9%
304,600 Cifra SA de CV, Cl. C .... 517,964
383,400 Grupo Elektra SA de CV ... 547,972
125,300 Organiz Soriana, Ser. B .. 473,569
---------
1,539,505
---------
Telecommunication Services &
Equipment -- 0.6%
8,000 Telefonos de Mexico SA, ADR 453,000
---------
Total Mexico ............. 6,394,811
=========
MOROCCO -- 1.8%
Banks -- 0.6%
4,325 Wafabank ................. 492,471
---------
Building, Construction &
Furnishings -- 0.6%
4,526 Cimenterie de l'Oriental . 491,149
---------
Diversified
Companies -- 0.6%
4,600 Omnium Nord Africian, SA . 487,351
---------
Total Morocco ............ 1,470,971
=========
NETHERLANDS -- 1.2%
Retailing &
Wholesale -- 1.2%
16,570 Ceteco Holding NV
Certificate .............. 926,069
=========
PANAMA -- 0.6%
Food & Beverage
Products -- 0.6%
12,025 Panamerican Beverages, Inc. 479,497
=========
PERU -- 1.1%
Telecommunication Services &
Equipment -- 1.1%
39,130 Telefonica del Peru SA, ADR 865,751
=========
PHILIPPINES -- 0.5%
Diversified
Companies -- 0.5%
4,939,500 JG Summit Holdings, Inc.,
Ser. B ................... 381,381
=========
</TABLE>
19
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
POLAND -- 1.2%
Building, Construction &
Furnishings -- 0.6%
134,500 Polifarb Cieszyn-Wroclaw SA . $ 498,955
----------
Retailing & Wholesale -- 0.6%
26,400 * Amica Wronki SA ........... 474,135
----------
Total Poland .............. 973,090
==========
PORTUGAL -- 7.0%
Building, Construction &
Furnishings -- 0.6%
14,300 Cimpor-Cimentos de Portugal
SA ........................ 528,855
----------
Finance & Insurance -- 3.8%
43,400 Banco Comercial Portugues SA,
ADR ....................... 1,486,450
8,583 Banco Comercial Portugues SA,
ADR, Receipts ............. 293,968
11,750 Banco Comercial Portugues SA,
Registered Shares ......... 411,937
17,300 Banco Espirito Santo e
Comercial de Lisbon SA .... 827,616
----------
3,019,971
----------
Telecommunication Services &
Equipment -- 2.0%
29,200 Portugal Telecom SA, ADR .. 1,569,500
----------
Utilities--Electric -- 0.6%
19,500 Electricidade de Portugal SA 508,834
----------
Total Portugal ............ 5,627,160
==========
SINGAPORE -- 1.5%
Consumer Products &
Services -- 0.3%
58,460 Parkway Holdings Ltd. ..... 126,340
36,000 Venture Manufacturing Ltd. 130,806
----------
257,146
----------
Food & Beverage
Products -- 0.6%
106,000 Fraser & Neave Ltd. ....... 475,577
----------
Information Services &
Technology -- 0.6%
20,950 Creative Technology Ltd. .. 435,548
----------
Total Singapore ........... 1,168,271
==========
SOUTH AFRICA -- 7.0%
Diversified Companies -- 2.7%
235,700 Rembrandt Group Ltd. ...... 2,145,271
----------
Finance & Insurance -- 3.5%
83,200 Liberty Life Association of
Africa, Ltd. .............. 2,815,037
----------
Retailing & Wholesale -- 0.8%
405,150 New Clicks Holdings Ltd. .. 641,314
----------
Total South Africa ........ 5,601,622
==========
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
SPAIN -- 2.5%
Food & Beverage
Products -- 2.5%
23,965 Campofrio Alimentacion SA . $1,965,350
==========
TAIWAN -- 0.8%
Business Equipment &
Services -- 0.2%
120,000 * Acer, Inc. ................ 200,155
----------
Food & Beverage
Products -- 0.6%
55,000 * President Enterprises Corp. 57,711
34,706 * President Enterprises Corp.,
GDR, 144A ................. 416,472
----------
474,183
----------
Total Taiwan .............. 674,338
==========
TURKEY -- 1.5%
Finance & Insurance -- 0.8%
8,500,000 * Haci Omer Sabanci ......... 620,624
----------
Food & Beverage Products -- 0.7%
1,552,000 Erciyas Biracilik Ve Malt . 251,474
2,777,000 Guney Biracilik Ve Malt
Sanayii, AS 299,976
----------
551,450
----------
Total Turkey .............. 1,172,074
==========
Total Common Stocks
(cost -- $48,177,627)...... 55,593,622
==========
PREFERRED STOCKS -- 12.5%
BRAZIL -- 10.7%
Aerospace & Defense -- 0.5%
25,000,000 Empresa Brasileira de
Aeronautica ............... 437,197
----------
Electrical Equipment &
Services -- 0.3%
4,200,000 Compania Energetica de Minas
Gerais .................... 203,821
----------
Iron & Steel -- 1.0%
33,800 Compania Vale do Rio Doce
Navegacao SA .............. 797,971
----------
Oil/Energy -- 0.7%
2,335,000 Petroleo Brasileiro SA,
("Petrobras") 592,096
----------
Telecommunication Services &
Equipment -- 8.2%
2,116,600 Companhia Riograndense de
Telecomunica .............. 2,794,619
7,350,000 Telecomunicacoes de Rio de
Janiero SA ................ 1,156,822
1,508,900 Telecomunicacoes do Parana SA 861,550
4,996,400 * Telecomunicaoes de Sao Paulo
SA ........................ 1,699,471
----------
6,512,462
----------
Total Brazil .............. 8,543,547
==========
</TABLE>
20
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
PREFERRED STOCKS -- continued
PORTUGAL -- 1.8%
Publishing, Broadcasting &
Entertainment -- 1.8%
106,800 Filmes Lusomundo ................. $1,447,417
==========
Total Preferred Stocks
(cost -- $8,322,566).............. 9,990,964
==========
CONVERTIBLE PREFERRED -- 0.5%
BRAZIL -- 0.5%
Utilities -- Electric -- 0.5%
26,000 Companhia Paranaense de
Energia-Copel, Plc, ADR,
6.25%,TIDES ...................... 370,500
----------
Total Convertible Preferred
(cost -- $395,562)................ 370,500
==========
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
RIGHTS -- 0.1%
PORTUGAL -- 0.1%
Finance & Insurance -- 0.1%
2,323 Banco Comercial Portuges SA, Rights $ 38,517
----------
Total Rights
(cost -- $38,586)................. 38,517
==========
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS -- 11.4%
UNITED STATES -- 11.4%
$ 9,052,000 Federal Home Loan Mortgage,
5.45%, 5/01/98 ...................... 9,052,000
---------
Total Short-Term Investments
(cost -- $9,052,000)................. 9,052,000
=========
Total Investments --
(cost -- $65,986,341) ..... 94.2% 75,045,603
Other Assets and
Liabilities -- Net ........ 5.8% 4,662,776
---- ----------
Net Assets ................. 100% $79,708,379
==== ===========
</TABLE>
* Non-income producing securities
144A Securities that may be resold to "qualified institutional buyers" under
Rule 144A of the Securities Act of 1933. These securities have been
determined to be liquid under guidelines established by the Funds Board of
Trustees.
(a) Less than one-tenth percent.
Summary of abbreviations:
ADR American Depository Receipts
GDR Global Depository Receipts
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
<TABLE>
<CAPTION>
Forward Foreign Currency Exchange Contracts to Sell:
Unrealized
U.S. Value at In Exchange Appreciation
Exchange Date Contracts to Deliver April 30, 1998 for U.S. $ (Depreciation)
- --------------- ---------------------------------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
4/30/98 187,232 Brazilian Real $163,714 $163,807 $ 93
5/4/98 181,212,327 Greek Drachma 576,393 574,366 (2,027)
5/4/98 191,080,958 Greek Drachma 607,783 605,645 (2,138)
5/4/98 121,298,250 Greek Drachma 385,821 384,464 (1,357)
5/4/98 176,906,791 Greek Drachma 562,699 560,719 (1,980)
5/5/98 21,804,429 Portuguese Escudo 118,535 118,547 12
5/5/98 90,436,030 Portuguese Escudo 491,634 491,687 53
5/5/98 48,397,433 Portuguese Escudo 263,101 263,130 29
5/5/98 79,879,047 Portuguese Escudo 434,243 434,290 47
</TABLE>
See Combined Notes to Financial Statements.
21
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- 91.1%
BELGIUM -- 2.2%
Healthcare Products & Services -- 0.7%
500 UCB SA ................................... $2,390,670
----------
Industrial Specialty Products &
Services -- 0.8%
10,000 Barco NV ................................. 2,648,792
----------
Retailing & Wholesale -- 0.7%
3,500 Colruyt SA ............................... 2,128,493
----------
Total Belgium ............................ 7,167,955
==========
CANADA -- 5.1%
Automotive Equipment &
Manufacturing -- 1.2%
50,000 Magna International, Inc., Cl.A .......... 3,728,125
----------
Chemical & Agricultural Products -- 1.1%
120,000 Du Pont Canada, Inc., Cl. A .............. 3,692,437
----------
Energy -- 0.8%
115,000 * Canadian Natural Resources, Ltd. ......... 2,472,989
----------
Industrial Specialty Products &
Services -- 2.0%
235,000 Bombardier, Inc., Cl. B .................. 6,343,578
----------
Total Canada ............................. 16,237,129
==========
DENMARK -- 0.9%
Healthcare Products & Services -- 0.9%
32,500 Coloplast AS ............................. 2,837,692
==========
FRANCE -- 4.3%
Building, Construction &
Furnishings -- 1.1%
28,320 Societe Technip .......................... 3,599,481
----------
Consumer Products & Services -- 0.0% (a)
220 L'Oreal .................................. 105,041
----------
Food & Beverage Products -- 0.9%
15,564 Sodexho Alliance ......................... 2,850,767
----------
Healthcare Products & Services -- 0.8%
17,000 Synthelabo ............................... 2,559,474
----------
Retailing & Wholesale -- 0.7%
3,800 Carrefour SA ............................. 2,177,841
----------
Textile & Apparel -- 0.8%
32,000 Hermes International ..................... 2,428,614
----------
Total France ............................. 13,721,218
==========
GERMANY -- 9.7%
Electrical Equipment & Services -- 0.5%
4,468 VEW AG ................................... 1,493,856
----------
Finance & Insurance -- 0.1%
44 * Allianz AG ............................... 13,412
1,500 Allianz AG, Registered Shares ............ 461,397
----------
474,809
----------
Food & Beverage Products -- 0.9%
5,000 Suedzucker AG ............................ 2,772,283
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Healthcare Products & Services -- 0.8%
32,000 Altana AG ................................ $2,459,112
----------
Information Services &
Technology -- 2.2%
15,000 SAP AG ................................... 7,104,845
----------
Textile & Apparel -- 2.7%
16,500 Adidas AG ................................ 2,735,366
3,500 Hugo Boss AG ............................. 5,851,049
----------
8,586,415
----------
Utilities -- Electric -- 2.5%
160,050 RWE AG ................................... 8,142,746
----------
Total Germany ............................ 31,034,066
==========
HONG KONG -- 2.8%
Diversified Companies -- 0.4%
2,870,000 First Pacific Ltd. ....................... 1,380,164
----------
Finance & Insurance -- 0.4%
1,635,000 National Mutual Asia Ltd. ................ 1,308,676
6,000 Peregrine Investment ..................... 0
----------
1,308,676
----------
Real Estate -- 0.7%
181,000 Cheung Kong Holdings, Ltd. ............... 1,203,395
152,400 Henderson China Holdings, Ltd. ........... 102,308
200,000 Henderson Land Development Co., Ltd. 893,365
----------
2,199,068
----------
Retailing & Wholesale -- 0.1%
2,000,000 Giordano International, Ltd. .............. 464,756
----------
Telecommunication Services &
Equipment -- 0.8%
34,843 Hong Kong Telecommunications, Ltd. ....... 65,224
121,000 Hong Kong Telecommunications,
Ltd., ADS ................................ 2,336,812
----------
2,402,036
----------
Utilities -- Gas -- 0.4%
948,200 Hong Kong & China Gas .................... 1,291,442
----------
Total Hong Kong .......................... 9,046,142
==========
IRELAND -- 0.8%
Building, Construction &
Furnishings -- 0.8%
14,396 CRH Plc .................................. 205,527
160,000 CRH Plc, London Exchange ................. 2,274,871
----------
Total Ireland ............................ 2,480,398
==========
ITALY -- 4.2%
Consumer Products & Services -- 1.3%
160,000 * Industrie Natuzzi SpA, ADS ............... 4,110,000
----------
Healthcare Products & Services --
1.2%
237,500 Luxottica Group SpA, ADS .................
3,963,281
----------
Textile & Apparel -- 1.7%
119,100 Benetton Group SpA, ADS .................. 5,270,175
----------
Total Italy .............................. 13,343,456
==========
</TABLE>
22
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
JAPAN -- 4.6 %
Consumer Products & Services -- 2.0 %
68,000 Nintendo Co., Ltd. ......................... $6,237,872
----------
Publishing, Broadcasting &
Entertainment -- 0.1 %
50,000 Kyodo Printing Co. ......................... 273,916
----------
Retailing & Wholesale -- 2.4%
115,400 Seven-Eleven Japan Co. Ltd. ................ 7,717,168
----------
Transportation -- 0.1 %
100,000 Keisei Electric Railway .................... 300,741
----------
Total Japan ................................ 14,529,697
==========
MALAYSIA -- 0.6 %
Automotive Equipment &
Manufacturing -- 0.1 %
134,000 Perusahaan Otomobil Nasional
Berhad ..................................... 165,973
----------
Banks -- 0.2 %
254,000 Commerce Asset Holding Berhad .............. 190,670
127,000 Malayan Banking Berhad ..................... 374,531
180,000 RHB Capital Berhad ......................... 133,673
----------
698,874
----------
Building, Construction &
Furnishings -- 0.1 %
166,000 United Engineers Ltd. Berhad ............... 133,067
----------
Chemical & Agricultural Products -- 0.1 %
92,000 Malaysian Oxygen Berhad .................... 271,314
----------
Finance & Insurance -- 0.0% (a)
101,000 AMMB Holdings Berhad ....................... 102,354
----------
Food & Beverage Products -- 0.1%
81,000 Nestle Malaysia Berhad ..................... 436,488
----------
Total Malaysia ............................. 1,808,070
==========
NETHERLANDS -- 4.7%
Diversified Companies -- 0.0% (a)
800 Unilever NV CVA ............................ 56,948
----------
Energy -- 0.6%
30,000 IHC Caland NV .............................. 1,746,448
----------
Food & Beverage Products -- 1.3%
20,263 CSM NV ..................................... 1,106,385
20,350 CSM NV, Certificates ....................... 1,108,113
60,000 Numico Kon NV .............................. 1,992,971
----------
4,207,469
----------
Information Services &
Technology -- 0.7%
49,200 Getronics NV ............................... 2,148,131
----------
Oil/Energy -- 0.0% (a)
2,600 Royal Dutch Petroleum Co. .................. 143,250
----------
Publishing, Broadcasting &
Entertainment -- 2.1%
14,000 Elsevier NV ................................ 211,376
61,500 Elsevier NV ADS ............................ 1,883,438
80,000 VNU ........................................ 2,597,891
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Publishing, Broadcasting &
Entertainment -- continued
14,550 Wolters Kluwer NV .......................... $1,905,091
----------
6,597,796
----------
Total Netherlands .......................... 14,900,042
==========
NORWAY -- 2.5%
Food & Beverage Products -- 1.5%
40,100 Orkla ASA .................................. 4,753,995
----------
Publishing, Broadcasting &
Entertainment -- 1.0%
175,000 Schibsted ASA .............................. 3,332,640
----------
Total Norway ............................... 8,086,635
==========
PORTUGAL -- 0.1%
Retailing & Wholesale -- 0.1%
3,496 Jeronimo Martins ........................... 163,444
----------
Telecommunication Services &
Equipment -- 0.0 % (a
2,000 Portugal Telecom SA ........................ 107,475
----------
Total Portugal ............................. 270,919
==========
SPAIN -- 1.8 %
Industrial Specialty Products &
Services -- 0.6 %
140,000 Prosegur, CIA de Seguridad SA .............. 1,764,938
----------
Utilities -- Electric -- 1.2 %
2,400 Endesa SA .................................. 58,306
155,500 Endesa SA, ADS ............................. 3,770,875
----------
3,829,181
----------
Total Spain ................................ 5,594,119
==========
SWEDEN -- 1.9 %
Healthcare Products & Services --
1.3 %
183,000 Astra AB, ADS .............................. 3,762,937
15,733 Astra AB, Ser. A ........................... 323,114
----------
4,086,051
----------
Retailing & Wholesale -- 0.6%
41,000 Hennes & Mauritz, Cl. B .................... 2,134,203
----------
Total Sweden ............................... 6,220,254
==========
SWITZERLAND -- 2.9 %
Chemical & Agricultural Products -- 1.8 %
1,000 * Ems- Chemie Holding AG ..................... 5,681,439
----------
Finance & Insurance -- 0.1%
165 * Schweizerische
Rueckversicherungs-Gesellschaft ............ 363,979
----------
Food & Beverage Products -- 0.3%
450 * Nestle SA .................................. 872,709
----------
Healthcare Products & Services -- 0.7 %
75 Novartis AG ................................ 124,359
695 Novartis AG, Registered Shares ............. 1,148,684
79 Roche Holding AG ........................... 800,530
</TABLE>
23
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Healthcare Products & Services -- continued
18 Roche Holding AG, Bearer Shares ...... $ 301,399
-----------
2,374,972
-----------
Total Switzerland .................... 9,293,099
===========
UNITED KINGDOM -- 8.6%
Advertising & Related Services -- 0.5%
100,000 Pearson Publishing Plc ............... 1,567,319
-----------
Banks -- 0.6
117,100 Lloyds TSB Group Plc ................. 1,754,044
-----------
Building, Construction &
Furnishings -- 0.3
125,800 Wolseley Plc ......................... 882,735
-----------
Chemical & Agricultural Products -- 0.3%
50,000 Burmah Castrol Plc ................... 1,034,565
-----------
Diversified Companies -- 0.8%
100,000 Smiths Industries Plc ................ 1,439,358
130,000 TI Group Plc ......................... 1,167,712
-----------
2,607,070
-----------
Finance & Insurance -- 0.3%
92,750 Legal & General Group Plc ............ 1,112,374
-----------
Healthcare Products & Services -- 1.2%
19,024 SmithKline Beecham Plc ............... 226,887
61,200 SmithKline Beecham Plc, ADR .......... 3,645,225
-----------
3,872,112
-----------
Industrial Specialty Products &
Services -- 1.4
220,000 Morgan Crucible Co. Plc .............. 1,660,646
280,200 Rentokil Initial Plc ................. 1,805,630
119,333 Williams Holdings Plc ................ 916,202
-----------
4,382,478
-----------
Publishing, Broadcasting &
Entertainment -- 1.3
17,100 Carlton Communications Plc ........... 153,170
45,000 Carlton Communications Plc, ADS ...... 2,041,875
120,000 Granada Group Plc .................... 2,067,457
-----------
4,262,502
-----------
Retailing & Wholesale -- 1.3%
79,560 Argos Plc ............................ 861,027
135,000 Laporte .............................. 1,817,806
177,000 Next Plc ............................. 1,465,536
-----------
4,144,369
-----------
Telecommunication Services &
Equipment -- 0.6
17,500 Vodafone Group Plc, ADR .............. 1,923,906
-----------
Total United Kingdom ................. 27,543,474
===========
UNITED STATES -- 33.4%
Advertising & Related Services -- 0.8%
35,800 Gannett Co., Inc. .................... 2,432,163
-----------
Automotive Equipment &
Manufacturing -- 0.5
30,000 TRW, Inc. ............................ 1,584,375
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Banks -- 0.6%
44,000 Norwest Corp. ........................ $ 1,746,250
-----------
Building, Construction &
Furnishings -- 1.0%
45,000 Home Depot, Inc. ..................... 3,133,125
-----------
Capital Goods -- 0.7%
39,800 Deere & Co. .......................... 2,325,813
-----------
Chemical & Agricultural Products -- 1.9
57,800 Du Pont (E. I.) De Nemours &Co. ...... 4,208,562
42,500 Nalco Chemical Co. ................... 1,689,375
-----------
5,897,937
-----------
Consumer Products & Services -- 2.6
25,800 Avon Products, Inc. .................. 2,120,437
73,250 * Cendant Corp. ........................ 1,831,250
50,000 Mattel, Inc. ......................... 1,915,625
46,000 Maytag Corp .......................... 2,369,000
-----------
8,236,312
-----------
Diversified Companies -- 0.9%
65,900 AlliedSignal, Inc. ................... 2,887,244
-----------
Electrical Equipment & Services -- 3.0
69,000 General Electric Co. ................. 5,873,625
52,300 Sundstrand Corp. ..................... 3,611,969
-----------
9,485,594
-----------
Energy -- 0.7%
45,000 Dresser Industries, Inc. ............. 2,379,375
-----------
Finance & Insurance -- 4.0%
43,000 Federal National Mortgage Association 2,574,625
21,900 Marsh & McLennan Co., Inc. ........... 1,995,637
74,850 MBNA Corp. ........................... 2,535,544
50,000 Schwab (Charles) & Co., Inc. ......... 1,750,000
35,000 SLM Holding Corp. .................... 1,494,063
50,000 SunAmerica, Inc. ..................... 2,496,875
-----------
12,846,744
-----------
Food & Beverage Products -- 0.9%
31,000 Campbell Soup Co. .................... 1,590,687
18,400 Coca Cola Co. ........................ 1,396,100
-----------
2,986,787
-----------
Healthcare Products & Services -- 2.1
34,000 Merck & Co., Inc. .................... 4,097,000
34,000 Schering-Plough Corp. ................ 2,724,250
-----------
6,821,250
-----------
Information Services &
Technology -- 7.2
53,750 * Cisco Systems, Inc. .................. 3,937,187
100,000 Compaq Computer Corp. ................ 2,806,250
45,000 Computer Associates
International, Inc. .................. 2,635,313
41,200 Intel Corp. .......................... 3,329,475
57,000 * Microsoft Corp. ...................... 5,137,125
65,000 * Oracle Systems Corp. ................. 1,681,875
106,000 * Parametric Technology Corp. .......... 3,388,687
-----------
22,915,912
-----------
</TABLE>
24
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCK -- continued
Leisure & Tourism -- 2.2%
45,900 Callaway Golf Co. ............... $ 1,250,775
40,000 Carnival, Corp. Cl. A ........... 2,782,500
24,300 Disney Walt Co. ................. 3,020,794
------------
7,054,069
------------
Publishing, Broadcasting &
Entertainment -- 0.5%
26,000 Tribune Co. ..................... 1,716,000
------------
Real Estate -- 1.5%
50,000 Marriott International, Inc. .... 1,650,000
65,000 Marriott International, Inc. Cl. A 2,080,000
37,500 Sodexho Marriott Services, Inc. . 956,250
------------
4,686,250
------------
Retailing & Wholesale -- 2.3%
45,000 Gap, Inc. ....................... 2,314,687
101,200 Wal-Mart Stores, Inc. ........... 5,116,925
------------
7,431,612
------------
Total United States ............. 106,566,812
============
Total Common Stocks
(Cost -- $231,931,434)........... 290,681,177
============
PREFERRED STOCKS -- 0.3%
GERMANY -- 0.3%
Utilities -- Electric -- 0.3%
25,000 RWE AG .......................... 1,046,223
============
Total Preferred Stocks
(Cost -- $966,606)............... 1,046,223
============
WARRANTS -- 0.0% (a)
HONG KONG -- 0.0% (a)
Utilities -- Gas -- 0.0%
43,100 Hong Kong & China Gas ........... 0
============
MALAYSIA -- 0.0% (a)
Banks -- 0.0%
26,750 Commerce Asset Holding, Warrants @
7.45MYR expiring 3/16/2002 ...... 3,335
------------
Total Warrants
(Cost -- $16,301)................ 3,335
============
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C> <C> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS -- 1.6%
UNITED STATES -- 1.6%
$ 350,000 U.S. Treasury Bond Strip,
5.72%, 8/15/05 ......................... $ 230,502
U.S. Treasury Bonds
1,430,000 11.75%,11/15/14 ........................ 2,121,316
500,000 7.50%, 11/15/16 ........................ 581,719
325,000 7.25%, 8/15/22 ......................... 374,664
988,000 7.625%, 11/15/22 ....................... 1,186,836
400,000 U.S. Treasury Notes,
6.25%, 2/15/03 ......................... 409,501
350,000 U.S. Treasury Strip,
5.70%, 2/15/05 ......................... 237,513
------------
Total U. S. Government & Agency
Obligations
(Cost -- $4,721,874).................... 5,142,051
============
SHORT-TERM INVESTMENTS -- 6.7%
UNITED STATES -- 6.7%
6,630,000 Federal Home Loan MortgageCorp.
5.41%, 5/28/98 ......................... 6,603,099
310,000 Four Winds Funding Corp.
5.53%, 5/4/98 .......................... 309,857
430,000 Golden Managers AcceptanceCorp.
5.53%, 6/2/98 .......................... 427,886
300,000 Magenta Capital Corp.
5.58%, 5/5/98 .......................... 299,814
2,250,000 Montana Blanc Capital Corp.
5.53%, 5/26/98 ......................... 2,241,360
Park Avenue Recreation Corp.
470,000 5.54%, 6/5/98 ......................... 468,991
350,000 5.52%, 5/15/98 ........................ 348,115
PHH Corp.
4,000,000 5.51%, 5/15/98 ........................ 3,991,429
315,000 5.55%, 5/20/98 ........................ 314,077
5,000,000 President & Fellows Harvard Co.
5.50%, 5/13/98 ......................... 4,990,833
715,000 Three Rivers Funding Corp.
5.53%, 5/19/98 ......................... 713,023
600,000 Tiger Managers Accept Corp.
5.53%, 6/2/98 .......................... 597,051
------------
Total Short-Term Investments
(Cost -- $21,305,535)................... 21,305,535
============
Total Investments --
(Cost $258,941,750).......... 99.7% 318,178,321
Other Assets and
Liabilities -- Net .......... 0.3% 1,009,665
---- ------------
Net Assets ................... 100% $319,187,986
==== ============
</TABLE>
25
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
* Non-income producing securities
(a) Less than one-tenth percent.
Summary of abbreviations:
ADR American Depository Receipts
ADS American Depository Shares
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
<TABLE>
<CAPTION>
Forward Foreign Currency Exchange Contracts to Sell:
Unrealized
U. S. Value at In Exchange Appreciation
Exchange Date Contracts to Deliver April 30, 1998 for U. S. $ (Depreciation)
- --------------- ------------------------------ ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
5/1/98 336,032 Hong Kong Dollar $43,381 $43,398 $17
</TABLE>
See Combined Notes to Financial Statements.
26
<PAGE>
EVERGREEN
International Equity Fund
Schedule of Investments
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- 90.9%
ARGENTINA -- 2.7%
Oil/Energy -- 1.7%
138,400 YPF SA, ADR ................. $4,826,700
4,000 YPF SA, Cl. D ............... 139,380
----------
4,966,080
----------
Telecommunication Services &
Equipment -- 1.0%
75,200 Telefonica de Argentina, ADR, 2,899,900
----------
Cl. B
Total Argentina ............. 7,865,980
==========
AUSTRALIA -- 0.3%
Food & Beverage
Products -- 0.3%
2,872,840 Burns Philp & Co., Ltd. ..... 374,762
84,596 Foodland Associates Ltd. .... 612,473
----------
Total Australia ............. 987,235
==========
AUSTRIA -- 2.4%
Energy -- 0.5%
10,521 OMV AG ...................... 1,561,506
----------
Engineering -- 0.9%
26,500 VAE Eisenbahnsysteme AG ..... 2,554,191
----------
Information Services &
Technology -- 1.0%
20,900 VA Technologie AG ........... 3,004,277
----------
Total Austria ............... 7,119,974
==========
BELGIUM -- 0.5%
Finance & Insurance -- 0.5%
10,923 Dexia Belgium (Credit Communal) 1,496,827
==========
BRAZIL -- 1.1%
Banks -- 0.5%
39,300 Unibanco Uniao de Barncos
Brasileiras SA, GDR ......... 1,562,175
----------
Telecommunication Services &
Equipment -- 0.3%
7,100 Telecomunicacoes Brasileiras
SA, ADR ("Telebras") ........ 864,869
----------
Utilities -- Water -- 0.3%
3,844,900 * Companhia de Saneamento Basico
do Estado ("SABESP") ........ 874,108
----------
Total Brazil ................ 3,301,152
==========
CHINA -- 0.4%
Transportation -- 0.4%
6,517,800 * Guangshen Railway Co. Ltd. .. 1,220,089
==========
DENMARK -- 2.5%
Banks -- 1.5%
35,500 Unidanmark AS, Registered 2,982,910
----------
Shares
Consumer Products &
Services -- 0.9%
48,100 * ISS International Service
System AS, Ser. B ........... 2,600,703
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Transportation -- 0.6%
96,700 SAS Danmark AS .............. $1,723,972
----------
Total Denmark ............... 7,307,585
==========
FINLAND -- 1.8%
Diversified Companies -- 1.3%
67,716 Huhtamaki Group ............. 3,916,304
----------
Machinery--Diversified -- 0.5%
67,666 Rauma OY .................... 1,267,200
----------
Total Finland ............... 5,183,504
==========
FRANCE -- 1.0%
Banks -- 1.4%
47,538 * Banque Nationale de Paris ... 4,009,610
----------
Finance & Insurance -- 2.1%
12,300 AXA-UAP ..................... 1,444,651
123,600 * Societe Genrale d'Enterprises 4,821,860
----------
SA 6,266,511
----------
Healthcare Products &
Services -- 2.0%
118,050 Rhone-Poulenc SA, Cl. A ..... 5,775,829
----------
Industrial Specialty Products &
Services -- 1.7%
96,900 Bouygues Offshore SA, ADR ... 2,077,294
18,270 Compagnie de Saint Gobain ... 3,045,506
----------
5,122,800
----------
Oil/Energy -- 2.8%
36,000 Societe Nationale Elf Aquitaine 4,725,337
SA
28,560 Total SA, Cl. B ............. 3,397,172
----------
8,122,509
----------
Total France ................ 29,297,259
==========
GERMANY -- 7.4%
Diversified Companies -- 0.5%
4,200 Preussag AG ................. 1,493,188
----------
Finance & Insurance -- 2.0%
23,700 Hannover Rueckversicherungs AG 3,011,117
6,100 Munchener Ruckvers .......... 2,787,328
----------
5,798,445
----------
Healthcare Products &
Services -- 3.0%
53,900 Degussa AG .................. 2,928,450
51,000 * Fresenius Medical Care AG ... 3,470,006
62,200 Hoechst AG .................. 2,509,074
----------
8,907,530
----------
Manufacturing--Distributing -- 1.1%
4,155 Mannesmann AG ............... 3,297,049
----------
Transportation -- 0.8%
5,700 GEA AG ...................... 2,305,982
----------
Total Germany ............... 21,802,194
==========
</TABLE>
27
<PAGE>
EVERGREEN
International Equity Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
HONG KONG -- 1.6%
Banks -- 0.1%
124,500 Wing Hang Bank Ltd. ................. $ 350,387
----------
Diversified Companies -- 1.5%
3,393,000 Cosco Pacific Ltd. .................. 2,299,671
3,580,793 First Pacific Ltd. .................. 1,721,980
112,400 * Jardine Matheson Holdings Ltd. ...... 474,328
----------
4,495,979
----------
Total Hong Kong ..................... 4,846,366
==========
INDIA -- 0.8%
Banks -- 0.6%
91,200 State Bank of India, GDR, 144A ...... 1,732,800
----------
Metal Products & Services -- 0.2%
38,025 Hindalco Industries Ltd., GDR, 144A . 731,981
----------
Total India ......................... 2,464,781
==========
IRELAND -- 1.4%
Food & Beverage Products -- 1.4%
193,100 Greencore Group Plc ................. 1,179,171
185,575 Kerry Group Plc ..................... 2,930,741
----------
Total Ireland ....................... 4,109,912
==========
ISRAEL -- 1.0%
Manufacturing -- Distributing -- 0.4%
35,500 Orbotech Ltd. ....................... 1,282,438
----------
Telecommunication Services &
Equipment -- 0.6%
53,800 ECI Telecommunications Ltd. ......... 1,640,900
----------
Total Israel ........................ 2,923,338
==========
ITALY -- 5.2%
Diversified Companies -- 0.0% (a)
12,200 * Grassetto SpA ....................... 700
----------
Energy -- 1.4%
591,000 ENI SpA ............................. 3,968,693
----------
Finance & Insurance -- 1.0%
1,360,600 Parmalat Finanziara SpA ............. 3,068,618
----------
Other -- 0.8%
77,000 Assicruz Generali ................... 2,316,934
----------
Publishing, Broadcasting &
Entertainment -- 0.5%
2,929,000 Seat SpA ............................ 1,455,116
----------
Telecommunication Services &
Equipment -- 1.5%
583,700 Telecom Italia SpA .................. 4,366,176
----------
Total Italy ......................... 15,176,237
==========
JAPAN -- 10.6%
Banks -- 0.0%
300 Sumitomo Bank Ltd. .................. 2,834
----------
Business Equipment &
Services -- 0.9%
220,000 Fujitsu Ltd. ........................ 2,568,384
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Consumer Products &
Services -- 2.0%
34,000 Sony Corp. .......................... $2,828,623
37,000 TDK Corp. ........................... 2,924,437
----------
5,753,060
----------
Electrical Equipment &
Services -- 4.2%
22,060 Advantest Corp. ..................... 1,483,558
300,000 Fujikura Ltd. ....................... 1,546,018
284,000 NEC Corp. ...........................
3,197,522
37,000 Rohm Co. Ltd. ....................... 4,176,968
52,000 Tokyo Electron Ltd. ................. 2,043,222
----------
12,447,288
----------
Finance & Insurance -- 1.9%
62,700 Orix Corp. .......................... 4,335,084
27,000 Takefuji Corp ....................... 1,417,939
----------
5,753,023
----------
Manufacturing--Distributing -- 1.5%
404,000 Minebea Co. Ltd. .................... 4,518,060
----------
Real Estate -- 0.1%
45,000 Hankyu Realty Co. ................... 212,861
----------
Total Japan ......................... 31,255,510
==========
KOREA -- 1.8%
Electrical Equipment &
Services -- 0.5%
29,470 Samsung Display Devices ............. 1,466,334
----------
Industrial Specialty Products &
Services -- 0.4%
157,090 Samsung Heavy Industries ............ 1,109,562
----------
Manufacturing--Distributing -- 0.3%
28,600 Hyundai Heavy Industries ............ 920,164
----------
Telecommunication Services &
Equipment -- 0.6%
156,030 Goldstar Telecommunications Co. ..... 1,856,249
----------
Total Korea ......................... 5,352,309
==========
LUXEMBOURG -- 0.3%
Telecommunication Services &
Equipment -- 0.3%
22,500 * Millicom International Cellular
SA, GDR ............................. 880,313
==========
MEXICO -- 0.6%
Food & Beverage Products -- 0.6%
245,000 Fomento Economico Mexicano .......... 1,814,387
==========
NETHERLANDS -- 6.3%
Consumer Products &
Services -- 3.4%
53,500 Hagemeyer NV ........................ 2,550,393
83,850 Philips Electronics NV .............. 7,367,643
----------
9,918,036
----------
Finance & Insurance -- 2.0%
90,000 ING Groep NV ........................ 5,831,889
----------
</TABLE>
28
<PAGE>
EVERGREEN
International Equity Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Food & Beverage
Products -- 0.4%
25,000 CSM NV, Certificates . $1,361,319
----------
Transportation -- 0.5%
39,300 Pakhoed NV Kon ....... 1,439,632
----------
Total Netherlands .... 18,550,876
==========
NEW ZEALAND -- 1.4%
Building, Construction &
Furnishings -- 0.5%
743,800 Fletcher Challenge
Building, ADR 1,503,979
----------
Finance &
Insurance -- 0.7%
3,711,700 Brierley Investments
Ltd. 2,144,323
----------
Forest Products -- 0.2%
345,350 Carter Holt Harvey Ltd. 458,502
----------
Total New Zealand .... 4,106,804
==========
NORWAY -- 1.6%
Banks -- 0.2%
21,600 Sparebanken Nor ...... 747,370
----------
Energy -- 0.8%
2,300 Smedvig ASA, ADR ..... 46,000
111,800 Smedvig ASA, Ser. B .. 2,249,029
----------
2,295,029
----------
Oil/Energy -- 0.6%
32,200 Transocean Offshore,
Inc. 1,799,175
----------
Total Norway ......... 4,841,574
==========
PAKISTAN -- 0.0% (a)
Energy -- 0.0%
4,488 * Sui Southern Gas Co.,
Ltd. 1,716
==========
PORTUGAL -- 0.7%
Banks -- 0.3%
65,200 Bco Mello SA ......... 970,822
----------
Building, Construction &
Furnishings -- 0.4%
68,400 Mota e Companhia SA .. 1,124,817
----------
Total Portugal ....... 2,095,639
==========
SINGAPORE -- 1.6%
Banks -- 1.4%
546,390 Development Bank of 3,625,337
Singapore Ltd.
320,000 Keppel Bank .......... 416,556
----------
4,041,893
----------
Real Estate -- 0.2%
485,600 DBS Land Ltd. ........ 733,386
----------
Total Singapore ...... 4,775,279
==========
SPAIN -- 1.9%
Banks -- 1.0%
34,500 Corporacion Bancaria de
Espana SA 2,876,888
----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Utilities -- 0.9%
163,500 Iberdrola SA ......... $2,630,171
----------
Total Spain .......... 5,507,059
==========
SWEDEN -- 6.2%
Consumer Products &
Services -- 1.6%
49,900 Electrolux AB, Ser. B 4,640,661
----------
Electrical Equipment &
Services -- 1.3%
241,600 AAB AB, Ser. B ....... 3,744,769
----------
Finance & Insurance -- 1.7%
662,778 Nordbanken Holding ... 4,879,662
----------
Healthcare Products &
Services -- 0.4%
39,800 Biora AB, ADR ........ 1,248,725
----------
Manufacturing--Distributing
-- 1.2%
179,000 SKF AB, Ser. B ....... 3,606,820
----------
Total Sweden ......... 18,120,637
==========
SWITZERLAND -- 5.1%
Diversified
Companies -- 1.0%
16,650 * Oerlikon Buhrle Holding AG 2,840,653
----------
Finance & Insurance -- 2.9%
2,085 Julius Baer Holding AG. 5,752,682
1,300 Schweizerische
Rueckversicherungs-
Gesellschaft ......... 2,867,711
----------
8,620,393
----------
Industrial Specialty
Products & Services -- 0.7%
2,980 Sulzer AG ............ 2,134,955
----------
Retailing &
Wholesale -- 0.5%
11,404 * Tag Heuer International 1,200,821
SA
12,600 * Tag Heuer International
SA, ADR .............. 137,025
----------
1,337,846
----------
Total Switzerland .... 14,933,847
==========
THAILAND -- 0.0% (a)
Building, Construction &
Furnishings -- 0.0% (a)
5,800 Siam Cement Public Co.
Ltd. ................. 81,935
----------
Real Estate -- 0.0% (a)
3,941 Land & House Public Co.,
Ltd.
Foreign Shares ....... 2,116
----------
Total Thailand ....... 84,051
==========
UNITED KINGDOM -- 13.7%
Automotive Equipment &
Manufacturing -- 1.1%
692,600 Rolls-Royce Plc ...... 3,232,248
----------
Banks -- 1.0%
187,700 Standard Chartered ... 2,828,831
----------
Building, Construction &
Furnishings -- 1.2%
1,695,000 Pilkington Plc ....... 3,558,208
----------
</TABLE>
29
<PAGE>
EVERGREEN
International Equity Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS -- continued
Chemical & Agricultural
Products -- 0.5%
80,300 Imperial Chemical Industries Plc ....... $ 1,458,691
------------
Diversified Companies -- 3.5%
995,800 Cookson Group Plc ...................... 4,472,335
8,800 Perpetual Plc .......................... 588,791
698,000 Williams Holdings Plc .................. 5,359,028
------------
10,420,154
------------
Electrical Equipment &
Services -- 0.3%
35,300 Siebe Plc .............................. 788,858
------------
Finance & Insurance -- 2.2%
140,800 HSBC Holdings Plc ...................... 4,017,144
220,400 Royal & Sun Alliance Insurance
Group Plc .............................. 2,462,669
------------
6,479,813
------------
Food & Beverage Products -- 0.2%
111,500 Safeway Plc ............................ 664,894
------------
Healthcare Products & Services -- 1.5%
83,900 Glaxo Wellcome Plc ..................... 2,371,738
652,800 Medeva Plc ............................. 1,943,650
------------
4,315,388
------------
Leisure & Tourism -- 0.6%
616,992 Thistle Hotels Plc ..................... 1,795,753
------------
Retailing & Wholesale -- 0.6%
173,700 Dixons Group ........................... 1,659,029
------------
Telecommunication Services &
Equipment -- 1.0%
417,200* Orange Plc ............................. 2,995,522
------------
Total United Kingdom ................... 40,197,389
============
Total Common Stocks
(Cost -- $241,477,537).................. 267,619,823
============
PREFERRED STOCKS -- 3.4%
AUSTRIA -- 1.2%
Banks -- 1.2%
47,200 Bank Austria AG ........................ 3,648,454
============
BRAZIL -- 1.7%
Iron & Steel -- 0.5%
63,300 Compania Vale do Rio Doce
Navegacao SA ........................... 1,494,426
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
PREFERRED STOCKS -- continued
Oil/Energy -- 0.5%
5,245,000 Petroleo Brasileiro SA, ("Petrobras") .. $ 1,329,996
------------
Telecommunication Services &
Equipment -- 0.7%
3,691,000 Telecomunicacoes de Rio de
Janiero SA ............................. 580,930
4,396,000* Telecomunicaoes de Sao Paulo SA ........ 1,495,251
------------
2,076,181
------------
Total Brazil ...........................................
4,900,603
============
GERMANY -- 0.5%
Manufacturing--Distributing -- 0.5%
4,615 KSB AG ................................. 1,543,005
------------
Total Preferred Stocks
(Cost -- $8,442,479).................... 10,092,062
============
WARRANTS -- 0.0% (a)
THAILAND -- 0.0% (a)
Manufacturing--Distributing -- 0.0% (a)
1,420* One Holding Public Co. Ltd.,
Warrants @ 44 THB, expiring
11/20/01 ............................... 0
============
Total Warrants
(Cost -- $0)............................... 0
============
RIGHTS -- 0.2%
KOREA -- 0.2%
Electrical Equipment &
Services -- 0.2%
29,470 Samsung Display Devices,
Rights, Expiring 5/13/98 ............... 511,563
============
Total Rights
(Cost -- $0)............................ 511,563
============
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS -- 5.2%
UNITED STATES -- 5.2%
$15,156,000 State Street Bank & Trust Co.,
purchased 4/30/98, 5.40%, maturing
5/1/98, maturity value $15,158,273
(b) (cost, $15,156,000)............ 15,156,000
----------
Total Short-Investments
(Cost -- $15,156,000).............. 15,156,000
==========
Total Investments --
(Cost $265,076,016) ..... 99.7% 293,379,448
Other Assets and
Liabilities -- Net ...... 0.3% 977,940
---- -----------
Net Assets ............... 100% $294,357,388
==== ============
</TABLE>
* Non-income producing securities
144A Securities that may be resold to "qualified institutional buyers"
under Rule 144A of the Securities Act of 1933. These securities have been
determined to be liquid under guidelines established by the Funds Board of
Trustees.
(a) Less than one-tenth percent.
(b) Repurchase agreements are fully collateralized by U.S. Government and/or
agency obligations based on market prices plus accrued interest at April 30,
1998.
Summary of abbreviations:
ADR American Depository Receipts
GDR Global Depository Receipts
30
<PAGE>
EVERGREEN
International Equity Fund
Schedule of Investments (continued)
April 30, 1998 (Unaudited)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
<TABLE>
<CAPTION>
Forward Foreign Currency Exchange Contracts to Buy:
Unrealized
U.S. Value at In Exchange Appreciation
Exchange Date Contracts to Receive April 30, 1998 for U.S. $ (Depreciation)
- --------------- ---------------------------------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
5/1/98 287,247 British Pounds $ 480,478 $ 479,415 $ 1,063
5/29/98 516,000,000 Japanese Yen 3,916,003 3,933,287 (17,284)
5/29/98 232,000,000 Japanese Yen 1,760,683 1,796,221 (35,538)
5/4/98 180,018 Norwegian Krone 24,142 24,181 (39)
5/4/98 87,221,167 Portuguese Escudo 474,157 474,802 (645)
Forward Foreign Currency Exchange Contracts to Sell:
Contracts to Deliver
----------------------------------
5/1/98 8,339,109 Japanese Yen $ 63,013 $ 63,056 $ 43
5/29/98 4,700,000 Japanese Yen 35,669,018 37,000,590 1,331,571
</TABLE>
See Combined Notes to Financial Statements.
31
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Assets and Liabilities
Six Months Ended April 30, 1998
<TABLE>
<CAPTION>
Emerging
Markets
Growth Fund
---------------
<S> <C>
Assets
Investments at value (identified cost -- $65,986,341, $258,941,750, and $265,076,016,
respectively) ......................................................................... $ 75,045,603
Foreign currency, at value (identified cost -- $23,223, $1,831,190, and $461,886,
respectively) ......................................................................... 23,223
Cash ................................................................................... 9,610
Receivable for investments sold ........................................................ 4,513,385
Receivable for Fund shares sold ........................................................ 460,530
Dividends and interest receivable ...................................................... 455,662
Unamortized organization expenses ...................................................... 13,748
Unrealized appreciation on forward foreign currency exchange contracts ................. 234
Pepaid expenses and other assets ....................................................... 25,982
- ------------------------------------------------------------------------------------------ ------------
Total assets ......................................................................... 80,547,977
- ------------------------------------------------------------------------------------------ ------------
Liabilities
Payable for investments purchased ...................................................... 665,803
Payable for Fund shares repurchased .................................................... 49,406
Advisory fee payable ................................................................... 56,137
Distribution Plan Expenses payable ..................................................... 5,446
Due to related parties ................................................................. 1,817
Unrealized depreciation on forward foreign currency exchange contracts ................. 7,502
Accrued expenses and other liabilities ................................................. 53,487
- ------------------------------------------------------------------------------------------ ------------
Total liabilities .................................................................... 839,598
- ------------------------------------------------------------------------------------------ ------------
Net assets .............................................................................. $ 79,708,379
- ------------------------------------------------------------------------------------------ ------------
Net assets represented by
Paid-in capital ........................................................................ $ 73,165,149
Undistributed net investment income (accumulated net investment loss) .................. 708,724
Accumulated undistributed net realized gain (loss) on investments and foreign currency
related transactions .................................................................. (3,222,498)
Net unrealized appreciation on investments and foreign currency
related transactions .................................................................. 9,057,004
- ------------------------------------------------------------------------------------------ ------------
Total net assets ..................................................................... $ 79,708,379
- ------------------------------------------------------------------------------------------ ------------
Net assets consists of
Class A ................................................................................ $ 6,555,616
Class B ................................................................................ 4,471,185
Class C ................................................................................ 664,119
Class Y ................................................................................ 68,017,459
- ------------------------------------------------------------------------------------------ ------------
$ 79,708,379
- ------------------------------------------------------------------------------------------ ------------
Shares outstanding
Class A ................................................................................ 609,554
Class B ................................................................................ 422,518
Class C ................................................................................ 62,821
Class Y ................................................................................ 6,291,549
- ------------------------------------------------------------------------------------------ ------------
Net asset value per share
Class A ................................................................................ $ 10.75
- ------------------------------------------------------------------------------------------ ------------
Class A -- Offering price (based on sales charge of 4.75%) ............................. $ 11.29
- ------------------------------------------------------------------------------------------ ------------
Class B ................................................................................ $ 10.58
- ------------------------------------------------------------------------------------------ ------------
Class C ................................................................................ $ 10.57
- ------------------------------------------------------------------------------------------ ------------
Class Y ................................................................................ $ 10.81
- ------------------------------------------------------------------------------------------ ------------
<CAPTION>
Global International
Leaders Equity
Fund Fund
--------------- ---------------
<S> <C> <C>
Assets
Investments at value (identified cost -- $65,986,341, $258,941,750, and $265,076,016,
respectively) ......................................................................... $318,178,321 $ 293,379,448
Foreign currency, at value (identified cost -- $23,223, $1,831,190, and $461,886,
respectively) ......................................................................... 1,831,657 464,602
Cash ................................................................................... 63,395 538
Receivable for investments sold ........................................................ 1,857,655 972,411
Receivable for Fund shares sold ........................................................ 1,110,987 1,568,230
Dividends and interest receivable ...................................................... 693,181 1,235,759
Unamortized organization expenses ...................................................... 19,884 6,358
Unrealized appreciation on forward foreign currency exchange contracts ................. 17 1,332,677
Pepaid expenses and other assets ....................................................... 68,447 53,123
- ------------------------------------------------------------------------------------------- ------------ -------------
Total assets ......................................................................... 323,823,544 299,013,146
- ------------------------------------------------------------------------------------------- ------------ -------------
Liabilities
Payable for investments purchased ...................................................... 3,661,969 3,671,491
Payable for Fund shares repurchased .................................................... 330,031 470,684
Advisory fee payable ................................................................... 248,758 214,256
Distribution Plan Expenses payable ..................................................... 160,169 21,777
Due to related parties ................................................................. 7,219 6,641
Unrealized depreciation on forward foreign currency exchange contracts ................. 0 53,506
Accrued expenses and other liabilities ................................................. 227,412 217,403
- ------------------------------------------------------------------------------------------- ------------ -------------
Total liabilities .................................................................... 4,635,558 4,655,758
- ------------------------------------------------------------------------------------------- ------------ -------------
Net assets .............................................................................. $319,187,986 $ 294,357,388
- ------------------------------------------------------------------------------------------- ------------ -------------
Net assets represented by
Paid-in capital ........................................................................ $259,239,005 $ 275,656,707
Undistributed net investment income (accumulated net investment loss) .................. (1,339,607) 303,774
Accumulated undistributed net realized gain (loss) on investments and foreign currency
related transactions .................................................................. 2,053,701 (11,179,384)
Net unrealized appreciation on investments and foreign currency
related transactions .................................................................. 59,234,887 29,576,291
- ------------------------------------------------------------------------------------------- ------------ -------------
Total net assets ..................................................................... $319,187,986 $ 294,357,388
- ------------------------------------------------------------------------------------------- ------------ -------------
Net assets consists of
Class A ................................................................................ $105,009,598 $ 12,910,914
Class B ................................................................................ 166,125,459 23,519,130
Class C ................................................................................ 3,535,421 593,940
Class Y ................................................................................ 44,517,508 257,333,404
- ------------------------------------------------------------------------------------------- ------------ -------------
$319,187,986 $ 294,357,388
- ------------------------------------------------------------------------------------------- ------------ -------------
Shares outstanding
Class A ................................................................................ 6,585,286 1,133,986
Class B ................................................................................ 10,570,477 2,078,769
Class C ................................................................................ 225,264 52,195
Class Y ................................................................................ 2,780,171 22,549,581
- ------------------------------------------------------------------------------------------- ------------ -------------
Net asset value per share
Class A ................................................................................ $ 15.95 $ 11.39
- ------------------------------------------------------------------------------------------- ------------ -------------
Class A -- Offering price (based on sales charge of 4.75%) ............................. $ 16.75 $ 11.96
- ------------------------------------------------------------------------------------------- ------------ -------------
Class B ................................................................................ $ 15.72 $ 11.31
- ------------------------------------------------------------------------------------------- ------------ -------------
Class C ................................................................................ $ 15.69 $ 11.38
- ------------------------------------------------------------------------------------------- ------------ -------------
Class Y ................................................................................ $ 16.01 $ 11.41
- ------------------------------------------------------------------------------------------- ------------ -------------
</TABLE>
See Combined Notes to Financial Statements.
32
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Operations
Six Months Ended April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
Emerging Markets
Growth Fund
-------------------
<S> <C>
Investment income
Dividends (net of foreign withholding taxes of $34,472, $109,955, and
$264,448, respectively)................................................. $ 815,186
Interest ................................................................ 443,868
- --------------------------------------------------------------------------- -------------
Total income .............................................................. 1,259,054
Expenses
Advisory fee ............................................................ 537,528
Distribution Plan expenses .............................................. 30,651
Transfer agent fees ..................................................... 23,528
Trustees fees ........................................................... 783
Custodian fees .......................................................... 48,012
Administrative services fees ............................................ 10,766
Amortization of organization expenses ................................... 5,048
Other ................................................................... 59,616
- --------------------------------------------------------------------------- -------------
Total expenses ......................................................... 715,932
Less: Indirectly paid expenses .......................................... (2,008)
Fee waivers and/or reimbursement from Investment Advisor .......... (145,745)
- --------------------------------------------------------------------------- -------------
Net expenses ............................................................ 568,179
- --------------------------------------------------------------------------- -------------
Net investment income (loss) 690,875
- --------------------------------------------------------------------------- -------------
Net realized and unrealized gain (loss) on investments and foreign
currency related transactions
Net realized gain (loss) from Investments ............................... (2,532,166)
Foreign currency related transactions .................................. (204,861)
- --------------------------------------------------------------------------- -------------
Net realized gain (loss) on investments and foreign currency
related transactions ................................................... (2,737,027)
- --------------------------------------------------------------------------- -------------
Net change in unrealized appreciation of investments and foreign
currency related transactions .......................................... 9,513,131
- --------------------------------------------------------------------------- -------------
Net realized and unrealized gain on investments and foreign currency
related transactions ................................................... 6,776,104
- --------------------------------------------------------------------------- -------------
Net increase in net assets resulting from operations .................... $ 7,466,979
- --------------------------------------------------------------------------- -------------
<CAPTION>
Global Leaders International Equity
Fund Fund
----------------- ----------------------
<S> <C> <C>
Investment income
Dividends (net of foreign withholding taxes of $34,472, $109,955, and
$264,448, respectively)................................................. $ 1,284,456 $ 2,241,342
Interest ................................................................ 386,637 627,185
- ---------------------------------------------------------------------------- ------------ --------------
Total income .............................................................. 1,671,093 2,868,527
Expenses
Advisory fee ............................................................ 1,183,378 988,003
Distribution Plan expenses .............................................. 821,583 121,708
Transfer agent fees ..................................................... 495,768 95,315
Trustees fees ........................................................... 3,299 4,520
Custodian fees .......................................................... 121,518 178,799
Administrative services fees ............................................ 37,088 39,566
Amortization of organization expenses ................................... 3,879 7,282
Other ................................................................... 335,312 94,050
- ---------------------------------------------------------------------------- ------------ --------------
Total expenses ......................................................... 3,001,825 1,529,243
Less: Indirectly paid expenses .......................................... (1,003) (14,597)
Fee waivers and/or reimbursement from Investment Advisor .......... 0 (15,783)
- ---------------------------------------------------------------------------- ------------ --------------
Net expenses ............................................................ 3,000,822 1,498,863
- ---------------------------------------------------------------------------- ------------ --------------
Net investment income (loss) (1,329,729) 1,369,664
- ---------------------------------------------------------------------------- ------------ --------------
Net realized and unrealized gain (loss) on investments and foreign
currency related transactions
Net realized gain (loss) from Investments ............................... 2,091,384 (13,588,352)
Foreign currency related transactions .................................. (17,239) 3,655,233
- ---------------------------------------------------------------------------- ------------ --------------
Net realized gain (loss) on investments and foreign currency
related transactions ................................................... 2,074,145 (9,933,119)
- ---------------------------------------------------------------------------- ------------ --------------
Net change in unrealized appreciation of investments and foreign
currency related transactions .......................................... 40,462,587 36,661,270
- ---------------------------------------------------------------------------- ------------ --------------
Net realized and unrealized gain on investments and foreign currency
related transactions ................................................... 42,536,732 26,728,151
- ---------------------------------------------------------------------------- ------------ --------------
Net increase in net assets resulting from operations .................... $ 41,207,003 $ 28,097,815
- ---------------------------------------------------------------------------- ------------ --------------
</TABLE>
See Combined Notes to Financial Statements.
33
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Changes In Net Assets
Six Months Ended April 30,1998 (Unaudited)
<TABLE>
<CAPTION>
Emerging Markets
Growth Fund
-------------------
<S> <C>
Operations
Net investment income (loss) ................................................ $ 690,875
Net realized gain (loss) on investments and foreign currency
related transactions ....................................................... (2,737,027)
Net change in unrealized appreciation of investments and foreign currency
related transactions ....................................................... 9,513,131
- ------------------------------------------------------------------------------ --------------
Net increase in net assets resulting from operations ........................ 7,466,979
- ------------------------------------------------------------------------------ --------------
Distributions to shareholders
From net investment income
Class A .................................................................... 0
Class B .................................................................... 0
Class C .................................................................... 0
Class Y .................................................................... (48,897)
In excess of net investment income
Class B .................................................................... 0
From net realized gain on investments and foreign currency
related transactions
Class A .................................................................... (79,620)
Class B .................................................................... (102,137)
Class C .................................................................... (33,101)
Class Y .................................................................... (1,528,035)
- ------------------------------------------------------------------------------ --------------
Total distributions to shareholders ........................................ (1,791,790)
- ------------------------------------------------------------------------------ --------------
Capital share transactions
Proceeds from shares sold ................................................... 17,022,793
Payment for shares redeemed ................................................. (13,483,866)
Net asset value of shares issued in reinvestment of distributions ........... 1,273,339
Shares issued in acquisition of Blanchard Global Growth Fund ................ 0
- ------------------------------------------------------------------------------ --------------
Net increase in net assets resulting from capital share transactions ....... 4,812,266
- ------------------------------------------------------------------------------ --------------
Total increase in net assets .............................................. 10,487,455
Net assets
Beginning of period ......................................................... 69,220,924
- ------------------------------------------------------------------------------ --------------
End of period ............................................................... $ 79,708,379
- ------------------------------------------------------------------------------ --------------
Undistributed net investment income (accumulated net investment loss) ........ $ 708,724
- ------------------------------------------------------------------------------ --------------
<CAPTION>
Global Leaders International Equity
Fund Fund
----------------- ----------------------
<S> <C> <C>
Operations
Net investment income (loss) ................................................ $ (1,329,729) $ 1,369,664
Net realized gain (loss) on investments and foreign currency
related transactions ....................................................... 2,074,145 (9,933,119)
Net change in unrealized appreciation of investments and foreign currency
related transactions ....................................................... 40,462,587 36,661,270
- ------------------------------------------------------------------------------- ------------- -------------
Net increase in net assets resulting from operations ........................ 41,207,003 28,097,815
- ------------------------------------------------------------------------------- ------------- -------------
Distributions to shareholders
From net investment income
Class A .................................................................... 0 (224,234)
Class B .................................................................... 0 (384,964)
Class C .................................................................... 0 (8,075)
Class Y .................................................................... 0 (5,671,218)
In excess of net investment income
Class B .................................................................... 0 (3,883)
From net realized gain on investments and foreign currency
related transactions
Class A .................................................................... (165,467) (468,089)
Class B .................................................................... (582,223) (1,009,391)
Class C .................................................................... (10,308) (20,961)
Class Y .................................................................... (150,779) (10,681,505)
- ------------------------------------------------------------------------------- ------------- -------------
Total distributions to shareholders ........................................ (908,777) (18,472,320)
- ------------------------------------------------------------------------------- ------------- -------------
Capital share transactions
Proceeds from shares sold ................................................... 45,606,831 72,610,356
Payment for shares redeemed ................................................. (34,112,745) (64,673,829)
Net asset value of shares issued in reinvestment of distributions ........... 804,394 11,027,273
Shares issued in acquisition of Blanchard Global Growth Fund ................ 55,765,847 0
- ------------------------------------------------------------------------------- ------------- -------------
Net increase in net assets resulting from capital share transactions ....... 68,064,327 18,963,800
- ------------------------------------------------------------------------------- ------------- -------------
Total increase in net assets .............................................. 108,362,553 28,589,295
Net assets
Beginning of period ......................................................... 210,825,433 265,768,093
- ------------------------------------------------------------------------------- ------------- -------------
End of period ............................................................... $ 319,187,986 $ 294,357,388
- ------------------------------------------------------------------------------- ------------- -------------
Undistributed net investment income (accumulated net investment loss) ........ $ (1,339,607) $ 303,774
- ------------------------------------------------------------------------------- ------------- -------------
</TABLE>
See Combined Notes to Financial Statements.
34
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Changes in Net Assets
For the Year Ended October 31, 1997
<TABLE>
<CAPTION>
Emerging Markets
Growth Fund
-------------------
<S> <C>
Operations
Net investment income (loss) ................................................... $ 67,828
Net realized gain on investments and foreign currency related transactions ..... 3,103,689
Net change in unrealized appreciation (depreciation) of investments and
foreign currency related transactions ......................................... (419,272)
- --------------------------------------------------------------------------------- --------------
Net increase in net assets resulting from operations ........................... 2,752,245
- --------------------------------------------------------------------------------- --------------
Distributions to shareholders
From net investment income
Class A ....................................................................... 0
Class B ....................................................................... 0
Class C ....................................................................... 0
Class Y ....................................................................... 0
From net realized gain on investments and foreign currency
related transactions
Class A ....................................................................... 0
Class B ....................................................................... 0
Class C ....................................................................... 0
Class Y ....................................................................... 0
- --------------------------------------------------------------------------------- --------------
Total distributions to shareholders ........................................... 0
- --------------------------------------------------------------------------------- --------------
Capital share transactions
Proceeds from shares sold ...................................................... 44,864,733
Payment for shares redeemed .................................................... (11,964,860)
Net asset value of shares issued in reinvestment of distributions .............. 0
- --------------------------------------------------------------------------------- --------------
Net increase in net assets resulting from capital share transactions .......... 32,899,873
- --------------------------------------------------------------------------------- --------------
Total increase in net assets ................................................. 35,652,118
Net assets
Beginning of year .............................................................. 33,568,806
- --------------------------------------------------------------------------------- --------------
End of year .................................................................... $ 69,220,924
- --------------------------------------------------------------------------------- --------------
Undistributed net investment income (accumulated net investment loss) ........... $ 66,746
- --------------------------------------------------------------------------------- --------------
<CAPTION>
Global Leaders International Equity
Fund Fund
----------------- ----------------------
<S> <C> <C>
Operations
Net investment income (loss) ................................................... $ (699,681) $ 1,732,140
Net realized gain on investments and foreign currency related transactions ..... 1,604,061 15,970,099
Net change in unrealized appreciation (depreciation) of investments and
foreign currency related transactions ......................................... 15,243,876 (13,032,715)
- ---------------------------------------------------------------------------------- ------------- -------------
Net increase in net assets resulting from operations ........................... 16,148,256 4,669,524
- ---------------------------------------------------------------------------------- ------------- -------------
Distributions to shareholders
From net investment income
Class A ....................................................................... 0 (107,348)
Class B ....................................................................... 0 (116,095)
Class C ....................................................................... 0 (1,194)
Class Y ....................................................................... 0 (2,176,422)
From net realized gain on investments and foreign currency
related transactions
Class A ....................................................................... (15,146) 0
Class B ....................................................................... (48,643) 0
Class C ....................................................................... (735) 0
Class Y ....................................................................... (19,126) 0
- ---------------------------------------------------------------------------------- ------------- -------------
Total distributions to shareholders ........................................... (83,650) (2,401,059)
- ---------------------------------------------------------------------------------- ------------- -------------
Capital share transactions
Proceeds from shares sold ...................................................... 135,313,747 164,093,117
Payment for shares redeemed .................................................... (14,708,624) (48,052,334)
Net asset value of shares issued in reinvestment of distributions .............. 72,520 1,232,582
- ---------------------------------------------------------------------------------- ------------- -------------
Net increase in net assets resulting from capital share transactions .......... 120,677,643 117,273,365
- ---------------------------------------------------------------------------------- ------------- -------------
Total increase in net assets ................................................. 136,742,249 119,541,830
Net assets
Beginning of year .............................................................. 74,083,184 146,226,263
- ---------------------------------------------------------------------------------- ------------- -------------
End of year .................................................................... $ 210,825,433 $ 265,768,093
- ---------------------------------------------------------------------------------- ------------- -------------
Undistributed net investment income (accumulated net investment loss) ........... $ (9,878) $ 5,226,484
- ---------------------------------------------------------------------------------- ------------- -------------
</TABLE>
See Combined Notes to Financial Statements.
35
<PAGE>
Combined Notes to Financial Statements
1. ORGANIZATION
The Evergreen International & Global Growth Funds consist of the Evergreen
Emerging Markets Growth Fund ("Emerging Markets"), Evergreen Global Leaders Fund
("Global Leaders") and Evergreen International Equity Fund ("International
Equity"), each of which are registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as diversified, open-end management investment
companies. Each Fund is a series of the Evergreen International Trust, a
Delaware business trust organized on September 17, 1997. Formerly, each Fund was
organized as either a Delaware business trust or a series of a Massachusetts
business trust. Emerging Markets, Global Leaders and International are
collectively referred to herein as the "Funds".
The Funds offer Class A, Class B, Class C and Class Y Shares. Class A shares are
sold with a maximum front-end sales charge of 4.75%. Class B and Class C shares
are sold without a front end sales charge, but pay a higher ongoing distribution
fee than Class A. Class B shares are sold subject to a contingent deferred sales
charge that is payable upon redemption and decreases depending on how long the
shares have been held. Class B shares purchased after January 1, 1997 will
automatically convert to Class A shares after seven years. Class B shares
purchased prior to January 1, 1997 retain their existing conversion rights.
Class C shares are sold subject to a contingent deferred sales charge payable on
shares redeemed within one year after the month of purchase. Class Y shares are
sold at net asset value and are not subject to contingent deferred sales charges
or distribution fees. Class Y shares are sold only to investment advisory
clients of First Union Corporation ("First Union") and its affiliates, certain
institutional investors or Class Y shareholders of record of certain other funds
managed by First Union and its affiliates as of December 30, 1994.
2. ACQUISITION INFORMATION
Effective December 1, 1997, Signet Banking Corporation ("Signet") merged with
First Union Corporation ("First Union"). Effective at the close of business on
February 27, 1998, Global Leaders acquired substantially all of the net assets
of Blanchard Global Growth Fund, an open-end management investment company
managed by a subsidiary of Signet and registered under the 1940 Act, valued at
$55,765,847. The net assets were exchanged through a non-taxable transaction for
6,174,408 Class A Shares of Global Leaders valued at $15.28 per share. The
acquired net assets consisted primarily of portfolio securities with unrealized
appreciation of $2,310,199. The aggregate net assets of Global Leaders after the
acquisition were $300,362,320.
3. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
policies are in conformity with generally accepted accounting principles, which
require management to make estimates and assumptions that affect amounts
reported herein. Actual results could differ from these estimates.
A. Valuation of Securities
The Funds value investments traded on an established exchange on the basis of
the last sales price on the exchange where primarily traded. The Funds value
securities traded in the over-the counter market at the mean between the bid and
asked prices. Securities for which market quotations are not available from an
independent pricing service, are valued at fair value as determined in good
faith according to procedures approved by the Board of Trustees. Short-term
investments with remaining maturities of 60 days or less are carried at
amortized cost, which approximates market value.
B. Repurchase Agreements
Each Fund may invest in repurchase agreements. Securities pledged as collateral
for repurchase agreements are held by the custodian on the Fund's behalf. Each
Fund monitors the adequacy of the collateral daily and will require the seller
to provide additional collateral in the event the market value of the securities
pledged falls below the carrying value of the repurchase agreement, including
accrued interest. Each Fund will only enter into repurchase agreements with
banks and other financial institutions which are deemed by the investment
advisor to be creditworthy pursuant to guidelines established by the Board of
Trustees.
Pursuant to an exemptive order issued by the Securities and Exchange Commission,
Latin America, along with certain other Funds managed by Keystone Investment
Management Company ("Keystone"), may transfer uninvested cash balances into a
joint trading account. These balances are invested in one or more repurchase
agreements that are fully collateralized by U.S. Treasury and/or federal agency
obligations.
36
<PAGE>
Combined Notes to Financial Statements (continued)
C. Foreign Currency
The books and records of the Funds are maintained in United States (U.S.)
dollars. Foreign currency amounts are translated into United States dollars as
follows: market value of investments, other assets and liabilities at the daily
rate of exchange; purchases and sales of investments, income and expenses at the
rate of exchange prevailing on the respective dates of such transactions. Net
unrealized foreign exchange gain (loss) resulting from changes in foreign
currency exchange rates is a component of net unrealized appreciation
(depreciation) on investments and foreign currency related transactions. Net
realized foreign currency gains and losses resulting from changes in exchange
rates include: foreign currency gains and losses between trade date and
settlement date on investment securities transactions, foreign currency related
transactions and the difference between the amounts of interest and dividends
recorded on the books of the Fund and the amounts that are actually received and
are included in realized gain (loss) on foreign currency related transactions.
The portion of foreign currency gains and losses related to fluctuations in
exchange rates between the initial purchase trade date and subsequent sale trade
date is included in realized gain (loss) on foreign currency related
transactions.
D. Forward Foreign Currency Exchange Contracts
The Funds may enter into forward foreign currency exchange contracts ("forward
contracts") to settle portfolio purchases and sales of securities denominated in
a foreign currency and to hedge certain foreign currency assets or liabilities.
Forward contracts are recorded at the forward rate and marked-to-market daily.
Realized gains and losses arising from such transactions are included in net
realized gain (loss) on foreign currency related transactions. The Fund bears
the risk of an unfavorable change in the foreign currency exchange rate
underlying the forward contract and is subject to the credit risk that the other
party will not fulfill their obligations under the contract. Forward contracts
involve elements of market risk in excess of the amount reflected in the
statement of assets and liabilities.
E. Security Transactions and Investment Income
Securities transactions are accounted for no later than one business day after
the trade date. Realized gains and losses are computed on the identified cost
basis. Interest income is recorded on the accrual basis and includes accretion
of discounts and amortization of premiums. Dividend income is recorded on the
ex-dividend date, or in the case of some foreign securities, on the date
thereafter when the Fund is made aware of the dividend. Foreign income may be
subject to foreign withholding taxes which are accrued as applicable. Capital
gains realized on some foreign securities may be subject to foreign taxes and
are accrued as applicable.
F. Federal Taxes
The Funds have qualified and intend to continue to qualify as regulated
investment companies under the Internal Revenue Code of 1986, as amended (the
"Code"). Thus, the Funds will not incur any federal income tax liability since
they are expected to distribute all of their net investment company taxable
income and net capital gains, if any, to their shareholders. The Funds also
intend to avoid excise tax liability by making the required distributions under
the Code. Accordingly, no provision for federal taxes is required. To the extent
that realized capital gains can be offset by capital loss carryforwards, it is
each Fund's policy not to distribute such gains.
G. Distributions
Distributions from net investment income for the Funds are declared and paid
annually. Distributions from net realized capital gains, if any, are paid at
least annually. Distributions to shareholders are recorded at the close of
business on the ex-dividend date.
Income and capital gains distributions to shareholders are determined in
accordance with income tax regulations, which may differ from generally accepted
accounting principles. The significant differences between financial statement
amounts available for distributions and distributions made in accordance with
income tax regulations are primarily due to differing treatment for net
operating losses.
H. Class Allocations
Income, expenses (other than class specific expenses) and realized and
unrealized gains and losses are prorated among the classes based on the relative
net assets of each class. Currently, class specific expenses are limited to
expenses incurred under the Distribution Plans for each class.
I. Organization Expenses
Organization expenses are amortized to operations over a five-year period on a
straight-line basis. In the event any of the initial shares of the Funds are
redeemed by any holder during the five-year amortization period, redemption
proceeds will be reduced by any unamortized organization expenses in the same
proportion as the number of initial shares being redeemed bears to the number of
initial shares outstanding at the time of the redemption.
37
<PAGE>
Combined Notes to Financial Statements (continued)
4. CAPITAL SHARE TRANSACTIONS
The Funds have an unlimited number of shares of beneficial interest with a par
value of $0.0001 authorized. Shares of beneficial interest of the Funds are
currently divided into Class A, Class B, Class C and Class Y. Transactions in
shares of the Funds were as follows:
- --------------------------------------------------------------------------------
EMERGING MARKETS
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1998 October 31, 1997
---------------------------- -----------------------------
Shares Amount Shares Amount
------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C>
Class A
Shares sold ................................... 1,024,168 $ 10,304,601 373,278 $ 3,938,592
Shares redeemed ............................... (700,583) (7,003,418) (289,832) (3,032,756)
Shares issued on reinvestment of distributions 8,077 78,672 0 0
- ----------------------------------------------- ----------- ------------- ----------- -------------
Net increase .................................. 331,662 3,379,855 83,446 905,836
- ----------------------------------------------- ----------- ------------- ----------- -------------
Class B
Shares sold ................................... 84,651 838,899 164,864 1,717,956
Shares redeemed ............................... (80,566) (794,961) (100,251) (1,000,964)
Shares issued on reinvestment of distributions 10,498 100,681 0 0
- ----------------------------------------------- ----------- ------------- ----------- -------------
Net increase .................................. 14,583 144,619 64,613 716,992
- ----------------------------------------------- ----------- ------------- ----------- -------------
Class C
Shares sold ................................... 22,724 227,095 128,876 1,301,468
Shares redeemed ............................... (93,546) (930,476) (8,773) (93,284)
Shares issued on reinvestment of distributions 3,451 33,092 0 0
- ----------------------------------------------- ----------- ------------- ----------- -------------
Net increase (decrease) ....................... (67,371) (670,289) 120,103 1,208,184
- ----------------------------------------------- ----------- ------------- ----------- -------------
Class Y
Shares sold ................................... 570,909 5,652,198 3,444,422 37,906,717
Shares redeemed ............................... (474,698) (4,755,011) (770,870) (7,837,856)
Shares issued on reinvestment of distributions 108,476 1,060,894 0 0
- ----------------------------------------------- ----------- ------------- ----------- -------------
Net increase .................................. 204,687 1,958,081 2,673,552 30,068,861
- ----------------------------------------------- ----------- ------------- ----------- -------------
Net increase .................................. 483,561 $ 4,812,266 2,941,714 $ 32,899,873
- ----------------------------------------------- ----------- ------------- ----------- -------------
</TABLE>
- --------------------------------------------------------------------------------
GLOBAL LEADERS
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1998 October 31, 1997
-------------------------------- ------------------------------
Shares Amount Shares Amount
--------------- ---------------- ------------- ----------------
<S> <C> <C> <C> <C>
Class A
Shares sold ................................................. 1,266,616 $ 17,131,384 2,037,338 $ 26,561,220
Shares redeemed ............................................. (1,165,611) (17,918,460) (304,314) (4,039,813)
Shares issued on reinvestment of distributions .............. 11,768 163,222 1,245 15,030
Shares issued in acquisition of Blanchard Global Growth Fund 3,648,723 55,765,847 -- --
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Net increase ................................................ 3,761,496 55,141,993 1,734,269 22,536,437
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Class B
Shares sold ................................................. 1,390,542 20,315,609 6,953,600 90,590,909
Shares redeemed ............................................. (798,896) (11,557,933) (55,510) (7,324,691)
Shares issued on reinvestment of distributions .............. 41,954 575,190 4,015 48,220
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Net increase ................................................ 633,600 9,332,866 6,902,105 83,314,438
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Class C
Shares sold ................................................. 69,403 1,031,934 173,061 2,249,794
Shares redeemed ............................................. (21,496) (302,095) (43,171) (592,995)
Shares issued on reinvestment of distributions .............. 721 9,873 52 629
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Net increase ................................................ 48,628 739,712 129,942 1,657,428
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Class Y
Shares sold ................................................. 476,641 7,127,904 1,227,611 15,911,824
Shares redeemed ............................................. (287,168) (4,334,257) (203,730) (2,751,116)
Shares issued on reinvestment of distributions .............. 4,034 56,109 715 8,632
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Net increase ................................................ 193,507 2,849,756 1,024,596 13,169,340
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
Net increase ................................................ 4,637,231 $ 68,064,327 9,790,912 $120,677,643
- ------------------------------------------------------------- ------------- -------------- ----------- --------------
</TABLE>
38
<PAGE>
Combined Notes to Financial Statements (continued)
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1998 October 31, 1997
-------------------------------- --------------------------------
Shares Amount Shares Amount
--------------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C>
Class A
Shares sold ................................... 3,144,142 $ 33,056,248 1,195,960 $ 14,003,449
Shares redeemed ............................... (2,915,363) (30,666,021) (1,061,687) (12,445,598)
Shares issued on reinvestment of distributions 67,503 685,158 9,990 105,895
- ----------------------------------------------- ------------- -------------- ------------- --------------
Net increase .................................. 296,282 3,075,385 144,263 1,663,746
- ----------------------------------------------- ------------- -------------- ------------- --------------
Class B
Shares sold ................................... 425,637 4,484,917 883,172 10,152,518
Shares redeemed ............................... (499,899) (5,192,998) (237,081) (2,706,025)
Shares issued on reinvestment of distributions 135,889 1,373,835 10,629 112,666
- ----------------------------------------------- ------------- -------------- ------------- --------------
Net increase .................................. 61,627 665,754 656,720 7,559,159
- ----------------------------------------------- ------------- -------------- ------------- --------------
Class C
Shares sold ................................... 18,899 200,412 28,287 332,705
Shares redeemed ............................... (8,279) (90,368) (7,619) (84,799)
Shares issued on reinvestment of distributions 2,765 28,152 103 1,096
- ----------------------------------------------- ------------- -------------- ------------- --------------
Net increase .................................. 13,385 138,196 20,771 249,002
- ----------------------------------------------- ------------- -------------- ------------- --------------
Class Y
Shares sold ................................... 3,370,301 34,868,779 11,916,116 139,604,445
Shares redeemed ............................... (2,762,321) (28,724,442) (2,865,928) (32,815,912)
Shares issued on reinvestment of distributions 879,934 8,940,128 95,469 1,012,925
- ----------------------------------------------- ------------- -------------- ------------- --------------
Net increase .................................. 1,487,914 15,084,465 9,145,657 107,801,458
- ----------------------------------------------- ------------- -------------- ------------- --------------
Net increase .................................. 1,859,208 $ 18,963,800 9,967,411 $ 117,273,365
- ----------------------------------------------- ------------- -------------- ------------- --------------
</TABLE>
5. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities (excluding
short-term investments) were as follows for the six months ended April 30, 1998:
<TABLE>
<CAPTION>
Cost of Proceeds
Purchases from Sales
-------------- --------------
<S> <C> <C>
Emerging Markets ........... $ 87,844,054 $ 71,884,826
Global Leaders ............. 57,567,451 13,665,899
International Equity ....... 142,585,526 115,348,055
</TABLE>
6. DISTRIBUTION PLANS
Evergreen Distributor, Inc. ("EDI"), a wholly-owned subsidiary of The BISYS
Group Inc. ("BISYS") serves as principal underwriter to the Funds.
Each Fund has adopted Distribution Plans for each class of shares, except Class
Y, as allowed by Rule 12b-1 of the 1940 Act. Distribution plans permit the Funds
to reimburse its principal underwriter for costs related to selling shares of
the Funds and for various other services. These costs, which consist primarily
of commissions and service fees to brokers who sell shares of the fund, are paid
by the fund through expenses called "Distribution Plan expenses". Each class,
except Class Y, currently pays a service fee equal to 0.25% of the average daily
net asset value of the class. Class B and Class C also pay distribution fees
equal to 0.75% of the average daily net assets of the class. Distribution Plan
expenses are calculated daily and paid monthly.
With respect to Class B and Class C shares, the principal underwriter may pay
12b-1 fees greater than the allowable annual amounts the Fund is permitted to
pay. The Fund may compensate the principal underwriter for such excess amounts
in later years with annual interest at the prime rate plus 1.00%.
39
<PAGE>
Combined Notes to Financial Statements (continued)
During the six months ended April 30, 1998, amounts paid to EDI and/or its
pursuant to each Fund's Class A, Class B and Class C Distribution Plans were as
follows:
<TABLE>
<CAPTION>
Class A Class B Class C
--------- ---------- ---------
<S> <C> <C> <C>
Emerging Markets ........... $ 5,162 $ 20,528 $ 4,961
Global Leaders ............. 76,396 731,550 13,637
International Equity ....... 12,308 106,892 2,508
</TABLE>
Each of the Distribution Plans may be terminated at any time by vote of the
Independent Trustees or by vote of a majority of the outstanding voting shares
of the respective class.
Contingent deferred sales charges paid by redeeming shareholders are paid to EDI
or its predecessor.
7. INVESTMENT MANAGEMENT AGREEMENT AND OTHER AFFILIATED TRANSACTIONS
Pursuant to an agreement with Emerging Markets' and International Equity's
investment advisor, Capital Management Group of First Union National Bank
("FUNB"), a subsidiary of First Union, is entitled to an annual fee based on
each of Emerging Markets' and International Equity's average daily net assets,
respectively, in accordance with the following schedules:
<TABLE>
<CAPTION>
Advisory Fee Average Daily Net Assets
-------------- --------------------------
<S> <C> <C>
Emerging Markets 1.50% on the first $100 million
1.45% on the next $100 million
1.40% on the next $100 million
1.35% in excess of $300 million
</TABLE>
<TABLE>
<CAPTION>
Advisory Fee Average Daily Net Assets
-------------- --------------------------
<S> <C> <C>
International Equity 0.82% on the first $20 million
0.79% on the next $30 million
0.76% on the next $50 million
0.73% in excess of $100 million
</TABLE>
Evergreen Asset Management Corp. ("Evergreen Asset"), a wholly-owned subsidiary
of First Union, serves as investment advisor to Global Leaders and is paid a
management fee that is computed daily and paid monthly at an annual rate of
0.95% of average daily net assets. Evergreen Asset has voluntarily agreed to
reimburse Global Leaders to the extent that the Fund's operating expenses
(including the investment advisory fee and amortization of organization expenses
but excluding interest, taxes, brokerage commissions, 12b-1 distribution and
shareholder servicing fees and extraordinary expenses) exceed 1.50% of its
average daily net assets.
Through August 31, 1997, Marvin & Palmer Associates, Inc. ("Marvin & Palmer")
was the sub-advisor for Emerging Markets. Effective September 1, 1997, Keystone
became Emerging Markets' sub-advisor.
Warburg, Pincus Counsellors, Inc. ("Warburg") is International Equity's
sub-advisor.
Under the terms of Emerging Markets' and International Equity's sub-advisory
agreements, Keystone and Warburg are responsible for the investment decisions
for their respective Funds and are paid by FUNB at no additional expense to the
Funds.
For Emerging Markets and International Equity, FUNB voluntarily waived $145,745
and $15,783, respectively, of its advisory fee for the six month ended April 30,
1998.
Lieber & Company, an affiliate of First Union, is the investment sub-adviser for
Global Leaders and also provides brokerage services with respect to
substantially all security transactions of the Fund effected on the New York or
American Stock Exchanges. For the six months ended April 30, 1998, Global
Leaders incurred brokerage commissions of $119,963 with Lieber & Company. Lieber
& Company is reimbursed by Evergreen Asset, at no additional expense to the
Fund, for its cost of providing investment advisory services.
Evergreen Investment Services, Inc. ("EIS") is the administrator and BISYS Fund
Services is the sub-administrator to the Funds. As sub-administrator to the
Funds, BISYS Fund Services provides the officers of the Funds. The administrator
and sub-administrator for each Fund are entitled to an annual fee based on the
average daily net assets of the Funds administered by EIS for which First Union
or its investment advisory subsidiaries are also the investment advisors. The
administration fee is calculated by applying percentage rates, which start at
0.05% and decline to 0.01% per annum as net assets increase, to the average
daily net asset value of each Fund. The sub-administration fee, for Emerging
Markets, Global Leaders and International Equity is calculated by applying
percentage rates, which start at 0.01% and decline to .004% as net assets
increase, to the average daily net asset value of each Fund.
40
<PAGE>
Combined Notes to Financial Statements (continued)
Evergreen Service Company ("ESC"), a wholly-owned subsidiary of Keystone, serves
as the transfer and dividend disbursing agent for the Funds.
Officers of the Funds and affiliated Trustees receive no compensation directly
from the Funds.
8. EXPENSE OFFSET ARRANGEMENT
The Funds have entered into an expense offset arrangement with their custodian.
The assets deposited with the custodian under this expense offset arrangement
could have been invested in income-producing assets.
9. DEFERRED INDEPENDENT TRUSTEES' FEES
Each Independent Trustee of the Funds may defer any or all compensation related
to performance of their duties as Trustees. The Trustees' deferred balances are
allocated to deferral accounts which are included in the accrued expenses for
the Funds. The investment performance of the deferral accounts are based on the
investment performance of certain Evergreen Funds. Any gains earned or losses
incurred in the deferral accounts are reported in the Fund's Trustees' fees and
expenses. Trustees will be paid either in one lump sum or in quarterly
installments for up to ten years at their election, not earlier than either the
year in which the Trustee ceases to be a member of the Board of Trustees or
January 1, 2000. As of April 30, 1998, the value of the Trustees deferral
accounts were $2,065, $12,228 and $8,698 for Emerging Markets, Global Leaders
and International Equity, respectively.
10. FINANCING AGREEMENT
On October 31, 1997, a temporary financing agreement between the participating
Funds and First Union became effective. Under this agreement, First Union
provided a fully committed unsecured credit facility in the aggregate amount of
$300 million. Borrowings under this facility bore interest at 1.00% per annum
above the Federal Funds rate. State Street served as administrative agent under
this agreement, but received no compensation for its services. This agreement
was terminated on December 22, 1997.
On December 22, 1997, a financing agreement among all of the Evergreen Funds,
State Street and a group of banks (the "Banks") became effective. Under this
agreement, the Banks provide an unsecured credit facility in the aggregate
amount of $400 million ($275 million committed and $125 million uncommitted).
The credit facility is allocated, under the terms of the financing agreement,
among the Banks. The credit facility is to be accessed by the Funds for
temporary or emergency purposes only and is subject to each Fund's borrowing
restrictions. Borrowings under this facility bear interest at 0.50% per annum
above the Federal Funds rate. A commitment fee of 0.065% per annum will be
incurred on the unused portion of the committed facility, which will be
allocated to all Funds. For its assistance in arranging this financing
agreement, the Capital Market Group of First Union was paid a one time
arrangement fee of $27,500. State Street serves as administrative agent for the
Banks, and as administrative agent is entitled to a fee of $20,000 per annum
which is allocated to all of the Funds.
During the six months ended April 30, 1998, the Funds had no significant
borrowings under these agreements.
41
<PAGE>
ADDITIONAL INFORMATION (Unaudited) Special Meeting of Shareholders
On December 15, 1997, a special meeting of shareholders for Emerging Markets,
Global Leaders and International Equity was held to consider a number of
proposals and had the following shares represented at the meeting. On October
16, 1997, the record date for the meeting, the Funds had the following shares
outstanding:
<TABLE>
<CAPTION>
Emerging Global International
Markets Leaders Equity
------------- -------------- --------------
<S> <C> <C> <C>
Record date shares outstanding .............................. 6,900,746 15,342,178 23,821,818
Shares represented at meeting ............................... 6,357,987 8,537,414 21,268,152
Percentage of record date shares represented at meeting ..... 92.1% 55.6% 89.3%
</TABLE>
The votes recorded at the meeting, by proposal, were as follows:
<TABLE>
<CAPTION>
Emerging Global International
Markets Leaders Equity
----------- ----------- --------------
<S> <C> <C> <C>
Proposal 1 -- The proposed reorganization of each Fund as a series of
the Evergreen International Trust,
a Delaware business trust:
Shares voted "For" ............. 6,341,285 7,952,210 21,169,177
Shares voted "Against" ......... 4,610 94,420 33,450
Shares voted "Abstain" ......... 12,092 490,784 65,525
Proposal 2 -- Reclassification as non-fundamental of the investment
objective currently classified as fundamental:
Shares voted "For" ............. 6,336,966 7,891,923 21,154,015
Shares voted "Against" ......... 8,646 135,178 44,245
Shares voted "Abstain" ......... 12,375 510,313 69,892
Proposal 3 -- Changes to Fundamental investment restrictions:
Proposal 3A -- To amend the Fundamental restriction concerning
diversification of investments:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted Abstain ........... 13,337 512,040 69,099
Proposal 3B -- To amend the Fundamental restriction concerning
concentration of a Fund's assets in a particular industry:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3C -- To amend the Fundamental restriction concerning the
issuance of senior securities:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3D -- To amend the Fundamental restriction concerning
borrowing:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3E -- To amend the Fundamental restriction concerning
underwriting:
Shares voted "For" ............. 6,340,119 7,910,949 21,157,861
Shares voted "Against" ......... 4,531 114,425 41,192
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3F -- To amend the Fundamental restriction concerning
investments in Real Estate:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3G -- To amend the Fundamental restriction concerning
commodities:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
</TABLE>
42
<PAGE>
ADDITIONAL INFORMATION (Unaudited) (continued)
<TABLE>
<CAPTION>
Emerging Global International
Markets Leaders Equity
----------- ----------- --------------
<S> <C> <C> <C>
Proposal 3H -- To amend the Fundamental restriction concerning lending:
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3I -- To amend the Fundamental restriction concerning
investment in Federally Tax Exempt Securities:
Shares voted "For" ............. -- -- 21,158,450
Shares voted "Against" ......... -- -- 40,603
Shares voted "Abstain" ......... -- -- 69,099
Proposal 3J9 -- Reclassification as nonfundamental of current
fundamental restriction: Unseasoned Issuers
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3J10 -- Reclassification as nonfundamental of current
fundamental restriction: Control or Management
Shares voted "For" ............. 6,340,119 7,910,949 21,158,450
Shares voted "Against" ......... 4,531 114,425 40,603
Shares voted "Abstain" ......... 13,337 512,040 69,099
Proposal 3J11 -- Reclassification as nonfundamental of current
fundamental restriction: Short Sales
Shares voted "For" ............. 6,340,119 -- 21,158,450
Shares voted "Against" ......... 4,531 -- 40,603
Shares voted "Abstain" ......... 13,337 -- 69,099
Proposal 3J12 -- Reclassification as nonfundamental of current
fundamental restriction: Margin Purchases
Shares voted "For" ............. 6,340,119 -- 21,158,450
Shares voted "Against" ......... 4,531 -- 40,603
Shares voted "Abstain" ......... 13,337 -- 69,099
</TABLE>
43
<PAGE>
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