<PAGE>
[LOGO]
EATON VANCE-Registered Trademark-
------------
MUTUAL FUNDS
[PHOTO]
Semiannual Report June 30, 2000
EATON VANCE
UTILITIES
FUND
[PHOTO]
[GRAPHIC]
75 YEARS OF EXCELLENCE
EATON VANCE
75TH
ANNIVERSARY
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
INVESTMENT UPDATE
INVESTMENT ENVIRONMENT
--------------------------------------------------------------------------------
[PHOTO]
Judith A. Saryan
Portfolio Manager
THE ECONOMY
- In response to a strong economy and signs of rising inflation, the Federal
Reserve Board raised the Federal Funds rate, a key barometer of short-term
interest rates, on six occasions in the past 13 months. The Fed has been
especially concerned that rising labor costs and increased demand, despite
improvements in productivity, could lead to higher inflation.
- There is evidence that the Fed's series of rate hikes is starting to have
the desired effect. Interest rate-sensitive sectors of the economy -
especially housing and construction - have slowed significantly. Although
still healthy, consumer spending has cooled off.
- Recent inflation indicators have been favorable. Wage gains, a source of
concern in a tight labor market, showed little movement in May. Both the
Producer Price Index and the Consumer Price Index have been benign, and the
number of manufacturers experiencing price increases from suppliers dropped
off sharply.
THE STOCK MARKET
- The first half of 2000 was characterized by a return to earth for many
high-flying technology stocks that led the market in recent years. The
tech-heavy NASDAQ Index reached a record high in March, before increasingly
valuation-sensitive investors - wary of interest rate hikes and
second-quarter earnings warnings - took some air out of the balloon. A
stronger performance in June pushed the NASDAQ's total return for 2000 to
-2.5%.(1)
- The Dow Jones Index, primarily made up of what have come to be known as
"Old Economy" stocks, benefited from investors' desire for solid earnings.
Healthcare and drug companies fared particularly well. After a difficult
first quarter, however, the Dow finished the first half of 2000
down 9.1%.(1)
THE FUND
--------------------------------------------------------------------------------
THE PAST SIX MONTHS
- During the six months ended June 30, 2000, the Fund's Class A shares had a
total return of -1.02%.(2) This return was the result of a decrease in net
asset value (NAV)to $10.84 on June 30, 2000 from $11.65 on December 31,
1999, and the reinvestment of $0.060 per share in dividend income and
$0.690 per share in capital gains.
- The Fund's Class B shares had a total return of -1.46%(2) during the
period, the result of a decrease in NAVto $12.83 from $13.68, and the
reinvestment of $0.02 per share in dividend income and $0.690 per share in
capital gains.
- The Fund's Class C shares had a total return of -1.44%(2) during the
period, the result of a decrease in NAVto $13.72 from $14.58, and the
reinvestment of $0.02 per share in dividend income and $0.690 per share in
capital gains.
- For comparison, during the six months ended June 30, 2000, the average
return of funds included in the Lipper Utility Funds Classification was
1.61%.(1)
MANAGEMENT DISCUSSION
- The Portfolio benefited from its holdings in electric utilities and natural
gas companies, which performed well in the first half of 2000. Our strategy
has been to research and invest in those companies we believe are
best-positioned for growth in the changing utilities environment.
- Telecommunications was an important component of the Portfolio. Although
this area underperformed the energy group, we believe that deregulation and
merger activity, combined with rapid advances in technology and demand for
wireless data and Internet services, have made telecommunications an area
with superior growth potential.
--------------------------------------------------------------------------------
Mutual fund shares are not insured by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are subject
to investment risks, including possible loss of principal invested.
--------------------------------------------------------------------------------
FUND INFORMATION
AS OF JUNE 30, 2000
<TABLE>
<CAPTION>
PERFORMANCE(3)
CLASS A CLASS B CLASS C
Average Annual Total Returns (at net asset value)
--------------------------------------------------------------------------------
<S> <C> <C> <C>
One Year 23.13% 22.17% 22.24%
Five Years 20.14 19.15 18.63
Ten Years 13.98 N.A. N.A.
Life of Fund+ 15.04 13.16 12.82
SEC Average Annual Total Returns (including sales charge or applicable CDSC)
--------------------------------------------------------------------------------
One Year 16.03% 17.20% 21.24%
Five Years 18.72 18.95 18.63
Ten Years 13.31 N.A. N.A.
Life of Fund+ 14.68 13.16 12.82
</TABLE>
+Inception Dates - Class A: 12/18/81; Class B: 11/1/93; Class C:11/1/93
<TABLE>
<CAPTION>
TEN LARGEST HOLDINGS(4) BY TOTAL NET ASSETS
-------------------------------------------------------
<S> <C>
SBC Communications, Inc. 6.0%
Energis 4.1
GTE Corp. 3.8
Dynegy, Inc. Class A 3.3
Bell Atlantic Corp. 2.5
Pinnacle West Capital Corp. 2.4
Versatel Telecom International NV ADR 2.2
Duke Energy Corp. 2.0
US West, Inc. 2.0
Enron Corp. 1.9
</TABLE>
(1) It is not possible to invest directly in an Index or a Lipper
Classification. (2) These returns do not include the 5.75% maximum sales
charge for the Fund's Class A shares or the applicable contingent deferred
sales charges (CDSC) for Class B and Class C shares. (3) Returns are
historical and are calculated by determining the percentage change in net
asset value with all distributions reinvested. SEC returns for Class A
reflect the maximum 5.75% sales charge. SEC returns for Class B reflect the
applicable CDSC based on the following schedule: 5% - 1st and 2nd years; 4% -
3rd year; 3% - 4th year; 2% - 5th year; 1% - 6th year. SEC 1-Year return for
Class C reflects 1% CDSC. (4) Ten largest holdings accounted for 30.2% of the
Portfolio's net assets. Holdings are subject to change.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
2
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF JUNE 30, 2000
<S> <C>
Assets
------------------------------------------------------
Investment in Utilities Portfolio, at
value
(identified cost, $456,122,398) $555,707,536
Receivable for Fund shares sold 181,275
------------------------------------------------------
TOTAL ASSETS $555,888,811
------------------------------------------------------
Liabilities
------------------------------------------------------
Payable for Fund shares redeemed $ 382,677
Payable to affiliate for service fees 12,802
Dividends payable 7,203
Payable to affiliate for Trustees' fees 1,129
Accrued expenses 363,862
------------------------------------------------------
TOTAL LIABILITIES $ 767,673
------------------------------------------------------
NET ASSETS $555,121,138
------------------------------------------------------
Sources of Net Assets
------------------------------------------------------
Paid-in capital $325,549,821
Accumulated undistributed net realized
gain from Portfolio (computed on the
basis of identified cost) 76,735,859
Accumulated undistributed net
investment income 53,250,320
Net unrealized appreciation from
Portfolio (computed on the basis of
identified cost) 99,585,138
------------------------------------------------------
TOTAL $555,121,138
------------------------------------------------------
Class A Shares
------------------------------------------------------
NET ASSETS $482,610,672
SHARES OUTSTANDING 44,515,247
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 10.84
MAXIMUM OFFERING PRICE PER SHARE
(100 DIVIDED BY 94.25 of $10.84) $ 11.50
------------------------------------------------------
Class B Shares
------------------------------------------------------
NET ASSETS $ 64,390,446
SHARES OUTSTANDING 5,017,795
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 12.83
------------------------------------------------------
Class C Shares
------------------------------------------------------
NET ASSETS $ 8,120,020
SHARES OUTSTANDING 591,914
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE
PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 13.72
------------------------------------------------------
</TABLE>
On sales of $50,000 or more, the offering price of Class A shares is reduced.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
JUNE 30, 2000
<S> <C>
Investment Income
------------------------------------------------------
Dividends allocated from Portfolio (net
of foreign taxes, $46,551) $ 6,019,185
Interest allocated from Portfolio 616,156
Miscellaneous income allocated from
Portfolio 75,040
Miscellaneous income 20,668
Expenses allocated from Portfolio (2,095,820)
------------------------------------------------------
NET INVESTMENT INCOME $ 4,635,229
------------------------------------------------------
Expenses
------------------------------------------------------
Trustees' fees and expenses $ 2,242
Distribution and service fees
Class A 547,754
Class B 316,124
Class C 38,166
Transfer and dividend disbursing agent
fees 349,397
Printing and postage 19,542
Custodian fee 18,264
Registration fees 15,160
Legal and accounting services 8,094
Miscellaneous 19,570
------------------------------------------------------
TOTAL EXPENSES $ 1,334,313
------------------------------------------------------
NET INVESTMENT INCOME $ 3,300,916
------------------------------------------------------
Realized and Unrealized
Gain (Loss) from Portfolio
------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 77,432,825
Foreign currency transactions (17,958)
------------------------------------------------------
NET REALIZED GAIN $ 77,414,867
------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $(86,228,889)
Foreign currency 5,609
------------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $(86,223,280)
------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS $ (8,808,413)
------------------------------------------------------
NET DECREASE IN NET ASSETS FROM
OPERATIONS $ (5,507,497)
------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INCREASE (DECREASE) JUNE 30, 2000 YEAR ENDED
IN NET ASSETS (UNAUDITED) DECEMBER 31, 1999
<S> <C> <C>
-----------------------------------------------------------------------------
From operations --
Net investment income $ 3,300,916 $ 6,194,248
Net realized gain 77,414,867 125,079,556
Net change in unrealized
appreciation (depreciation) (86,223,280) 43,682,523
-----------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $ (5,507,497) $ 174,956,327
-----------------------------------------------------------------------------
Distributions to shareholders --
From net investment income
Class A $ (2,647,937) $ (6,244,986)
Class B (96,203) (299,749)
Class C (10,621) (30,087)
In excess of net investment income
Class B -- (22,519)
Class C -- (1,552)
From net realized gain
Class A (29,843,628) (85,788,426)
Class B (3,226,037) (8,971,252)
Class C (363,730) (783,772)
-----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS $ (36,188,156) $ (102,142,343)
-----------------------------------------------------------------------------
Transactions in shares of beneficial interest --
Proceeds from sale of shares
Class A $ 7,845,308 $ 7,215,976
Class B 8,747,110 9,756,289
Class C 2,755,973 2,447,477
Net asset value of shares issued to
shareholders in payment of
distributions declared
Class A 26,537,180 73,428,828
Class B 2,837,643 7,735,663
Class C 316,340 668,605
Cost of shares redeemed
Class A (24,676,085) (43,507,543)
Class B (5,256,919) (9,661,613)
Class C (768,339) (1,290,706)
-----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM FUND
SHARE TRANSACTIONS $ 18,338,211 $ 46,792,976
-----------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS $ (23,357,442) $ 119,606,960
-----------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 2000 YEAR ENDED
NET ASSETS (UNAUDITED) DECEMBER 31, 1999
-----------------------------------------------------------------------------
<S> <C> <C>
At beginning of period $ 578,478,580 $ 458,871,620
-----------------------------------------------------------------------------
AT END OF PERIOD $ 555,121,138 $ 578,478,580
-----------------------------------------------------------------------------
Accumulated undistributed
net investment income
included in net assets
-----------------------------------------------------------------------------
AT END OF PERIOD $ 53,250,320 $ 52,704,165
-----------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2000 --------------------------------------------------------
(UNAUDITED)(1) 1999(1) 1998(1) 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning of
period $ 11.650 $10.150 $8.450 $8.770 $9.130 $ 7.630
--------------------------------------------------------------------------------------------------------------------
Income (loss) from operations
--------------------------------------------------------------------------------------------------------------------
Net investment income $ 0.071 $0.150 $0.251 $0.409 $0.626 $ 0.523
Net realized and unrealized gain
(loss) (0.131) 3.773 1.721 0.887 (0.014)(2) 1.520
--------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM OPERATIONS $ (0.060) $3.923 $1.972 $1.296 $0.612 $ 2.043
--------------------------------------------------------------------------------------------------------------------
Less distributions
--------------------------------------------------------------------------------------------------------------------
From net investment income $ (0.060) $(0.162 ) $(0.235 ) $(0.331 ) $(0.522 ) $ (0.364)
In excess of net investment income -- -- -- -- -- (0.039)
From net realized gain (0.690) (2.261) (0.037) (1.243) (0.450) (0.078)
In excess of net realized gain -- -- -- (0.042) -- (0.062)
--------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $ (0.750) $(2.423 ) $(0.272 ) $(1.616 ) $(0.972 ) $ (0.543)
--------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD $ 10.840 $11.650 $10.150 $8.450 $8.770 $ 9.130
--------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(3) (1.02)% 40.75% 23.78% 16.18% 7.00% 27.52%
--------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
--------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $482,611 $509,845 $409,178 $370,457 $401,974 $457,879
Ratios (As a percentage of average
daily net assets):
Operating expenses(4) 1.10%(5) 1.08% 1.11% 1.12% 1.20% 1.16%
Interest expense(4) --(5)(6) --(6) 0.16% 0.01% 0.03% 0.03%
Net investment income 1.24%(5) 1.33% 2.75% 4.06% 5.59% 4.49%
Portfolio Turnover of the Portfolio 59% 93% 78% 169% 166% 103%
--------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) The per share amount is not in accord with the net realized and
unrealized gain (loss) for the period because of the timing of sales of
Fund shares and the amount of the per share realized and unrealized
gains and losses at such time.
(3) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(4) Includes the Fund's share of the Portfolio's allocated expenses.
(5) Annualized.
(6) Represents less than 0.01%.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS B
--------------------------------------------
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2000 ------------------------
(UNAUDITED)(1) 1999(1) 1998(1)
<S> <C> <C> <C>
------------------------------------------------------------------------------------
Net asset value -- Beginning of
period $13.680 $11.610 $ 9.670
------------------------------------------------------------------------------------
Income (loss) from operations
------------------------------------------------------------------------------------
Net investment income $ 0.032 $ 0.076 $ 0.209
Net realized and unrealized gain
(loss) (0.172) 4.337 1.970
------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM OPERATIONS $(0.140) $ 4.413 $ 2.179
------------------------------------------------------------------------------------
Less distributions
------------------------------------------------------------------------------------
From net investment income $(0.020) $(0.076) $(0.202)
In excess of net investment income -- (0.006) --
From net realized gain (0.690) (2.261) (0.037)
------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $(0.710) $(2.343) $(0.239)
------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD $12.830 $13.680 $11.610
------------------------------------------------------------------------------------
TOTAL RETURN(2) (1.46)% 39.71% 22.89%
------------------------------------------------------------------------------------
Ratios/Supplemental Data
------------------------------------------------------------------------------------
Net assets, end of period
(000's omitted) $64,390 $62,285 $45,958
Ratios (As a percentage of average
daily net assets):
Operating expenses(3) 1.86%(4) 1.82% 1.85%
Interest expense(3) --(4)(5) --(5) 0.16%
Net investment income 0.48%(4) 0.59% 2.01%
Portfolio Turnover of the Portfolio 59% 93% 78%
------------------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the Portfolio's allocated expenses.
(4) Annualized.
(5) Represents less than 0.01%.
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS C
--------------------------------------------
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2000 ------------------------
(UNAUDITED)(1) 1999(1) 1998(1)
<S> <C> <C> <C>
------------------------------------------------------------------------------------
Net asset value -- Beginning of
period $14.580 $12.270 $10.190
------------------------------------------------------------------------------------
Income (loss) from operations
------------------------------------------------------------------------------------
Net investment income $ 0.034 $ 0.078 $ 0.220
Net realized and unrealized gain
(loss) (0.184) 4.589 2.082
------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM OPERATIONS $(0.150) $ 4.667 $ 2.302
------------------------------------------------------------------------------------
Less distributions
------------------------------------------------------------------------------------
From net investment income $(0.020) $(0.091) $(0.185)
In excess of net investment income -- (0.005) --
From net realized gain (0.690) (2.261) (0.037)
------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $(0.710) $(2.357) $(0.222)
------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF PERIOD $13.720 $14.580 $12.270
------------------------------------------------------------------------------------
TOTAL RETURN(2) (1.44)% 39.67% 22.88%
------------------------------------------------------------------------------------
Ratios/Supplemental Data
------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $ 8,120 $ 6,349 $ 3,736
Ratios (As a percentage of average
daily net assets):
Operating expenses(3) 1.87%(4) 1.85% 1.89%
Interest expense(3) --(4)(5) --(5) 0.16%
Net investment income 0.48%(4) 0.57% 1.99%
Portfolio Turnover of the Portfolio 59% 93% 78%
------------------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the Portfolio's allocated expenses.
(4) Annualized.
(5) Represents less than 0.01%.
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1 Significant Accounting Policies
-------------------------------------------
Eaton Vance Utilities Fund (the Fund), is a diversified series of Eaton Vance
Special Investment Trust (the Trust). The Trust is an entity of the type
commonly known as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company. The Fund offers three classes of shares: Class A,
Class B and Class C shares. Class A shares are generally sold subject to a
sales charge imposed at time of purchase. Class B and Class C shares are sold
at net asset value and are subject to a contingent deferred sales charge (see
Note 6). Each class represents a pro rata interest in the Fund, but votes
separately on class-specific matters and (as noted below) is subject to
different expenses. Realized and unrealized gains and losses and net
investment income, other than class-specific expenses, are allocated daily to
each class of shares based on the relative net assets of each class to the
total net assets of the Fund. Each class of shares differs in its
distribution plan and certain other class-specific expenses. The Fund invests
all of its investable assets in interests in the Utilities Portfolio (the
Portfolio), a New York Trust, having the same investment objective as the
Fund. The value of the Fund's investment in the Portfolio reflects the Fund's
proportionate interest in the net assets of the Portfolio (99.9% at June 30,
2000). The performance of the Fund is directly affected by the performance of
the Portfolio. The financial statements of the Portfolio, including the
portfolio of investments, are included elsewhere in this report and should be
read in conjunction with the Fund's financial statements.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A Investment Valuation -- Valuation of securities by the Portfolio is discussed
in Note 1A of the Portfolio's Notes to Financial Statements which are
included elsewhere in this report.
B Income -- The Fund's net investment income consists of the Fund's pro-rata
share of the net investment income of the Portfolio, less all actual and
accrued expenses of the Fund determined in accordance with generally accepted
accounting principles.
C Federal Taxes -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments. Accordingly, no provision for federal
income or excise tax is necessary. Pursuant to Section 852 of the Internal
Revenue Code, the Fund designates $82,031,415 as a long-term capital gain
distribution for its taxable year ended December 31, 1999.
D Other -- Investment transactions are accounted for on a trade-date basis.
E Use of Estimates -- The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could
differ from those estimates.
F Interim Financial Statements -- The interim financial statements relating to
June 30, 2000 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the Fund's
management reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
2 Distributions to Shareholders
-------------------------------------------
The Fund's policy is to distribute monthly substantially all of the net
investment income allocated to the Fund by the Portfolio (less the Fund's
direct expenses) and to distribute at least annually substantially all of its
net realized capital gains so allocated. Distributions are paid in the form
of additional shares of the same class or, at the election of the
shareholder, in cash. The Fund distinguishes between distributions on a tax
basis and a financial reporting basis. Generally accepted accounting
principles require that only distributions in excess of tax basis earnings
and profits be reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in over
distributions only for financial statement purposes are classified as
distributions in excess of net investment income or net realized gain on
investments. Permanent differences between book and tax accounting relating
to distributions are reclassified to paid-in capital.
3 Shares of Beneficial Interest
-------------------------------------------
The Fund's Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of
8
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
beneficial interest (without par value). Such shares may be issued in a
number of different series (such as the Fund) and classes. Transactions in
Fund shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 2000 YEAR ENDED
CLASS A (UNAUDITED) DECEMBER 31, 1999
<S> <C> <C>
-----------------------------------------------------------------------------
Sales 681,012 637,060
Issued to shareholders electing to
receive payments of distributions in
Fund shares 2,244,882 6,712,318
Redemptions (2,158,967) (3,894,436)
-----------------------------------------------------------------------------
NET INCREASE 766,927 3,454,942
-----------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 2000 YEAR ENDED
CLASS B (UNAUDITED) DECEMBER 31, 1999
<S> <C> <C>
-----------------------------------------------------------------------------
Sales 646,376 736,414
Issued to shareholders electing to
receive payments of distributions in
Fund shares 202,179 603,765
Redemptions (384,749) (744,478)
-----------------------------------------------------------------------------
NET INCREASE 463,806 595,701
-----------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 2000 YEAR ENDED
CLASS C (UNAUDITED) DECEMBER 31, 1999
<S> <C> <C>
-----------------------------------------------------------------------------
Sales 188,073 176,541
Issued to shareholders electing to
receive payments of distributions in
Fund shares 21,076 49,012
Redemptions (52,669) (94,581)
-----------------------------------------------------------------------------
NET INCREASE 156,480 130,972
-----------------------------------------------------------------------------
</TABLE>
4 Transactions with Affiliates
-------------------------------------------
Eaton Vance Management (EVM) serves as the administrator of the Fund, but
receives no compensation. The Portfolio has engaged Boston Management and
Research (BMR), a subsidiary of Eaton Vance Management (EVM), to render
investment advisory services. See Note 2 of the Portfolio's Notes to
Financial Statements which are included elsewhere in this report. Except as
to Trustees of the Fund and the Portfolio who are not members of EVM's or
BMR's organization, officers and Trustees receive remuneration for their
services to the Fund out of such investment adviser fee. The Fund was
informed that Eaton Vance Distributors, Inc. (EVD), a subsidiary of EVM and
the Fund's principal underwriter, received $25,495 from the Fund as its
portion of the sales charge on sales of Class A shares for the six months
ended June 30, 2000.
Certain officers and Trustees of the Fund and of the Portfolio are officers
of the above organizations.
5 Distribution and Service Plans
-------------------------------------------
The Fund has in effect distribution plans for Class B shares (Class B Plan)
and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the Investment
Company Act of 1940, as amended, and a service plan for Class A shares
(Class A Plan) (collectively, the Plans). The Class B and Class C Plans
require the Fund to pay EVD amounts equal to 1/366 of 0.75% (annualized) of
the Fund's average daily net assets attributable to Class B and Class C
shares for providing ongoing distribution services and facilities to the
Fund. The Fund will automatically discontinue payments to EVD during any
period in which there are no outstanding Uncovered Distribution Charges,
which are equivalent to the sum of (i) 5% and 6.25% of the aggregate amount
received by the Fund for the Class B and Class C shares sold, respectively,
plus (ii) interest calculated by applying the rate of 1% over the prevailing
prime rate to the outstanding balance of Uncovered Distribution Charges of
EVD of each respective class, reduced by the aggregate amount of contingent
deferred sales charges (see Note 6) and daily amounts theretofore paid to EVD
by each respective class. The Fund paid or accrued $242,189 and $28,751 for
Class B and Class C shares, respectively, to or payable to EVD for the six
months ended June 30, 2000, representing 0.75% (annualized) of the average
daily net assets for Class B and Class C shares. At June 30, 2000, the amount
of Uncovered Distribution Charges EVD calculated under the Plan were
approximately $446,000 and $1,072,000 for Class B and Class C shares,
respectively.
The Plans authorize the Fund to make payments of service fees to EVD,
investment dealers and other persons in amounts not exceeding 0.25% of the
Fund's average daily net assets attributable to Class A, Class B, and
Class C shares for any fiscal year. The Trustees initially implemented the
Plans by authorizing the Fund to make quarterly payments of service fees to
EVD and investment dealers equal to 0.25% per annum of the Fund's average
daily net assets attributable to Class A and Class B shares based on the
value of Fund shares sold by such persons and remaining outstanding for at
least one year. On October 4, 1999, the Trustees approved service fee
payments equal to 0.25% per annum of the Fund's average daily net assets
attributable to Class A and Class B shares for any fiscal year on shares of
the Fund sold on or
9
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
after October 12, 1999. The Class C Plan permits the Fund to make monthly
payments of service fees in amounts not expected to exceed 0.25% of the
Fund's average daily net assets attributable to Class C shares for any fiscal
year. Service fee payments will be made for personal services and/or the
maintenance of shareholder accounts. Service fees are separate and distinct
from the sales commissions and distribution fees payable by the Fund to EVD,
and, as such are not subject to automatic discontinuance when there are no
outstanding Uncovered Distribution Charges of EVD. Service fee payments for
the six months ended June 30, 2000 amounted to $547,754, $73,935, and $9,415
for Class A, Class B, and Class C shares, respectively.
Certain officers and Trustees of the Fund are officers of the above
organizations.
6 Contingent Deferred Sales Charge
-------------------------------------------
A contingent deferred sales charge (CDSC) generally is imposed on redemptions
of Class B shares made within six years of purchase and on redemptions of
Class C shares made within one year of purchase. A CDSC of 1% is imposed on
any redemption of Class A shares made within 12 months of purchase that were
acquired at net asset value if the purchase amount was $1 million or more.
Generally, the CDSC is based upon the lower of the net asset value at date of
redemption or date of purchase. No charge is levied on shares acquired by
reinvestment of dividends or capital gains distributions. The Class B CDSC is
imposed at declining rates that begin at 5% in the case of redemptions in the
first and second year after purchase, declining one percentage point each
subsequent year. Class C shares will be subject to a 1% CDSC if redeemed
within one year of purchase. No CDSC is levied on shares which have been sold
to EVM or its affiliates or to their respective employees or clients and may
be waived under certain other limited conditions. CDSC charges are paid to
EVD to reduce the amount of Uncovered Distribution Charges calculated under
the Fund's Distribution Plan (See Note 5). CDSC charges received when no
Uncovered Distribution Charges exist will be retained by the Fund. The Fund
was informed that EVD received approximately $26,000 and $1,000 of CDSC paid
by shareholders for Class B and Class C shares, respectively, for the six
months ended June 30, 2000.
7 Investment Transactions
-------------------------------------------
Increases and decreases in the Fund's investments in the Portfolio for the
six months ended June 30, 2000, aggregated $19,489,762 and $38,678,708,
respectively.
10
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
PORTFOLIO OF INVESTMENTS (UNAUDITED)
COMMON STOCKS -- 87.9%
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Broadcasting and Cable -- 1.2%
-----------------------------------------------------------------------
Comcast Corp., Class A(1) 75,000 $ 3,037,500
Ovation, Inc.(1)(2) 285,787 2,857,870
Young Broadcasting, Inc., Class A(1) 25,000 642,187
-----------------------------------------------------------------------
$ 6,537,557
-----------------------------------------------------------------------
Communications Equipment -- 4.1%
-----------------------------------------------------------------------
Alcatel ADR 135,000 $ 8,977,500
Cable Design Technologies Corp.(1) 160,000 5,360,000
LM Ericsson Telephone Co., ADR 70,000 1,400,000
Lucent Technologies, Inc. 80,000 4,740,000
Nokia Corp. ADR 15,000 749,062
Spectrum Control, Inc.(1) 100,000 1,362,500
-----------------------------------------------------------------------
$ 22,589,062
-----------------------------------------------------------------------
Computer Software -- 0.1%
-----------------------------------------------------------------------
SilverStream Software, Inc.(1) 12,500 $ 721,875
-----------------------------------------------------------------------
$ 721,875
-----------------------------------------------------------------------
Electric Utilities -- 15.8%
-----------------------------------------------------------------------
AES Corp.(1) 155,000 $ 7,071,875
Calpine Corp.(1) 60,000 3,945,000
Cleco Corp. 300,000 10,050,000
DQE, Inc. 240,000 9,480,000
Edison International 50,000 1,025,000
FPL Group, Inc. 75,000 3,712,500
Kansas City Power and Light Co. 165,000 3,712,500
Montana Power Co. 30,800 1,087,625
National Grid Group plc(3) 800,000 6,309,920
Niagra Mohawk Holdings, Inc.(1) 40,000 557,500
NRG Energy, Inc.(1) 200,300 3,655,475
Pinnacle West Capital Corp. 400,000 13,550,000
ScottishPower plc ADR 160,500 5,366,719
Sierra Pacific Resources 144,000 1,809,000
Southern Co. (The) 175,000 4,079,687
TXU Corp. 75,000 2,212,500
Unicom Corp. 270,000 10,445,625
-----------------------------------------------------------------------
$ 88,070,926
-----------------------------------------------------------------------
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Gas Utilities -- 7.2%
-----------------------------------------------------------------------
Coastal Corp. (The) 150,000 $ 9,131,250
Columbia Energy Group 75,000 4,921,875
El Paso Energy Corp. 40,000 2,037,500
Kinder Morgan, Inc. 150,000 5,184,375
National Fuel Gas Co. 125,000 6,093,750
NICOR, Inc. 155,000 5,056,875
San Juan Basin Royalty Trust 500,000 5,000,000
Williams Cos., Inc. (The) 60,000 2,501,250
-----------------------------------------------------------------------
$ 39,926,875
-----------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 1.1%
-----------------------------------------------------------------------
Coflexip SA ADR 43,100 $ 2,607,550
Santa Fe International Corp. 5,000 174,687
Tidewater, Inc. 100,000 3,600,000
-----------------------------------------------------------------------
$ 6,382,237
-----------------------------------------------------------------------
Oil and Gas - Exploration and Production -- 4.2%
-----------------------------------------------------------------------
Burlington Resources, Inc. 110,000 $ 4,207,500
Devon Energy Corp. 25,000 1,404,687
EOG Resources, Inc. 60,000 2,010,000
Mitchell Energy & Development Corp.,
Class A 67,400 2,165,225
Pioneer Natural Resources Co.(1) 125,000 1,593,750
Swift Energy Co.(1) 75,000 2,128,125
Talisman Energy, Inc.(3) 300,000 9,937,500
-----------------------------------------------------------------------
$ 23,446,787
-----------------------------------------------------------------------
REITS -- 0.6%
-----------------------------------------------------------------------
Annaly Mortgage, Inc. 144A(1)(4) 350,000 $ 3,171,875
-----------------------------------------------------------------------
$ 3,171,875
-----------------------------------------------------------------------
Telecommunication Equipment -- 0.3%
-----------------------------------------------------------------------
Cabletron Systems, Inc.(1) 70,000 $ 1,767,500
-----------------------------------------------------------------------
$ 1,767,500
-----------------------------------------------------------------------
Telecommunications Services -- 21.5%
-----------------------------------------------------------------------
Adelphia Business Solutions, Inc.(1) 100,000 $ 2,318,750
Alamosa PCS Holdings, Inc.(1) 10,000 208,750
Allegiance Telecom, Inc.(1) 20,000 1,280,000
Cable & Wireless plc ADR 90,000 4,505,625
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Telecommunications Services (continued)
-----------------------------------------------------------------------
Call-Net Enterprises Inc., Class B(1) 160,000 $ 390,000
China Unicom, Ltd. ADR(1) 200 4,250
Clearnet Communications, Inc.(1) 12,500 347,070
COLT Telecom Group plc ADR(1) 10,000 1,356,250
ECI Telecom, Ltd. 150,000 5,362,500
Energis (3)(1) 605,000 22,696,212
Global TeleSystems, Inc. 375,000 4,523,437
GT Group Telecom, Inc., Class B(1) 35,000 553,437
Helsingin Puhelin Oyj(3) 73,850 7,263,244
Koninklijke KPN NV ADR 20,866 937,666
Microcell Telecommunications, Inc.(1) 70,000 2,528,750
Net2000 Communications, Inc.(1) 15,000 245,625
Netcom Systems, AB(3) 100,000 7,422,420
Nextel Communications, Inc., Class A(1) 15,000 917,812
NEXTLINK Communications, Inc.(1) 80,000 3,035,000
Partner Communications Co., Ltd. ADR(1) 125,000 1,187,500
Primus Telecommunications Group, Inc.(1) 70,000 1,741,250
RSL Communications, Ltd.(1) 135,000 1,544,063
Tele1 Europe Holding AB ADR(1) 75,000 904,688
Telecom Italia Mobile(3) 900,000 9,231,210
Thus plc(3) 250,000 1,048,375
UbiquiTel, Inc.(1) 300,000 2,831,250
US Unwired, Inc., Class A(1) 65,000 845,000
Versatel Telecom International NV ADR(1) 285,000 12,290,625
Viatel, Inc.(1) 37,500 1,071,094
Vodafone AirTouch plc ADR 80,000 3,315,000
Vodafone Group PLC 1,743,938 7,049,172
WorldCom, Inc.(1) 225,000 10,321,875
-----------------------------------------------------------------------
$119,277,900
-----------------------------------------------------------------------
Telephone Utilities -- 19.9%
-----------------------------------------------------------------------
Alltel Corp. 130,000 $ 8,051,875
AT&T Corp. 80,000 2,530,000
Bell Atlantic Corp. 275,000 13,973,438
BellSouth Corp. 235,000 10,016,875
CenturyTel, Inc. 180,000 5,175,000
GTE Corp. 340,000 21,165,000
SBC Communications, Inc. 770,000 33,302,500
Sprint Corp. 100,000 5,100,000
US West, Inc. 130,000 11,147,500
-----------------------------------------------------------------------
$110,462,188
-----------------------------------------------------------------------
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Utilities - Electrical and Gas -- 11.9%
-----------------------------------------------------------------------
CMS Energy Corp. 50,000 $ 1,106,250
Constellation Energy Group 145,000 4,721,563
Dominion Resources, Inc. 175,000 7,503,125
Duke Energy Corp. 200,000 11,275,000
Dynegy, Inc., Class A 270,000 18,444,375
Enron Corp. 165,000 10,642,500
MDU Resources Group, Inc. 125,000 2,703,125
Nisource, Inc. 200,000 3,725,000
SCANA Corp. 260,000 6,272,500
-----------------------------------------------------------------------
$ 66,393,438
-----------------------------------------------------------------------
Total Common Stocks
(identified cost $417,538,021) $488,748,220
-----------------------------------------------------------------------
</TABLE>
CONVERTIBLE PREFERRED STOCKS -- 8.9%
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Gas Utilities -- 3.5%
-----------------------------------------------------------------------
El Paso Energy Capital Trust 300,000 $ 19,312,500
-----------------------------------------------------------------------
$ 19,312,500
-----------------------------------------------------------------------
Telephone Utilities -- 5.4%
-----------------------------------------------------------------------
Omnipoint Corp.(4) 180,000 $ 30,420,000
-----------------------------------------------------------------------
$ 30,420,000
-----------------------------------------------------------------------
Total Convertible Preferred Stocks
(identified cost $23,725,148) $ 49,732,500
-----------------------------------------------------------------------
</TABLE>
CONVERTIBLE BONDS -- 2.7%
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
SECURITY (000'S OMITTED) VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Bell Atlantic Financial, 4.25%,
9/15/05(4) $ 5,500 $ 6,737,500
NTL, Inc., 7.00%, 12/15/08(4) 3,000 4,905,000
Ovation, Inc. (PIK), 9.75%, 2/23/01(2) 3,269 3,268,752
-----------------------------------------------------------------------
Total Convertible Bonds
(identified cost, $12,545,002) $ 14,911,252
-----------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
COMMERCIAL PAPER -- 1.1%
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
SECURITY (000'S OMITTED) VALUE
<S> <C> <C>
-----------------------------------------------------------------------
Associates Corp. of North America,
6.89%, 7/3/00 $ 5,890 $ 5,887,746
-----------------------------------------------------------------------
Total Commercial Paper
(at amortized cost, $5,887,745) $ 5,887,746
-----------------------------------------------------------------------
Total Investments -- 100.6%
(identified cost $459,695,916) $559,279,718
-----------------------------------------------------------------------
Other Assets, Less Liabilities -- (0.6)% $ (3,572,148)
-----------------------------------------------------------------------
Net Assets -- 100.0% $555,707,570
-----------------------------------------------------------------------
</TABLE>
ADR - American Depositary Receipt
(PIK) - Payment in kind.
(1) Non-income producing security.
(2) Security valued at fair value using methods determined in good faith by
or at the direction of the Trustees.
(3) Foreign security.
(4) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF JUNE 30, 2000
<S> <C>
Assets
------------------------------------------------------
Investments, at value
(identified cost, $459,695,916) $559,279,718
Cash 4,157
Interest and dividends receivable 1,428,277
Miscellaneous receivable 15,213
Tax reclaim receivable 9,413
------------------------------------------------------
TOTAL ASSETS $560,736,778
------------------------------------------------------
Liabilities
------------------------------------------------------
Payable for investments purchased $ 4,980,128
Payable to affiliate for Trustees' fees 6,514
Accrued expenses 42,566
------------------------------------------------------
TOTAL LIABILITIES $ 5,029,208
------------------------------------------------------
NET ASSETS APPLICABLE TO INVESTORS'
INTEREST IN PORTFOLIO $555,707,570
------------------------------------------------------
Sources of Net Assets
------------------------------------------------------
Net proceeds from capital contributions
and withdrawals $456,122,430
Net unrealized appreciation (computed on
the basis of identified cost) 99,585,140
------------------------------------------------------
TOTAL $555,707,570
------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
JUNE 30, 2000
<S> <C>
Investment Income
------------------------------------------------------
Dividends (net of foreign taxes,
$46,551) $ 6,019,185
Interest 616,156
Miscellaneous 75,040
------------------------------------------------------
TOTAL INVESTMENT INCOME $ 6,710,381
------------------------------------------------------
Expenses
------------------------------------------------------
Investment adviser fee $ 1,877,128
Trustees fees and expenses 13,180
Custodian fee 161,530
Legal and accounting services 25,675
Interest expense 16,382
Miscellaneous 1,925
------------------------------------------------------
TOTAL EXPENSES $ 2,095,820
------------------------------------------------------
NET INVESTMENT INCOME $ 4,614,561
------------------------------------------------------
Realized and Unrealized Gain (Loss)
------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 77,432,829
Foreign currency transactions (17,958)
------------------------------------------------------
NET REALIZED GAIN $ 77,414,871
------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $(86,228,894)
Foreign currency 5,609
------------------------------------------------------
NET CHANGE IN UNREALIZED
APPRECIATION (DEPRECIATION) $(86,223,285)
------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS $ (8,808,414)
------------------------------------------------------
NET DECREASE IN NET ASSETS FROM
OPERATIONS $ (4,193,853)
------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INCREASE (DECREASE) JUNE 30, 2000 YEAR ENDED
IN NET ASSETS (UNAUDITED) DECEMBER 31, 1999
<S> <C> <C>
-----------------------------------------------------------------------------
From operations --
Net investment income $ 4,614,561 $ 8,403,351
Net realized gain 77,414,871 125,079,564
Net change in unrealized
appreciation (depreciation) (86,223,285) 43,682,525
-----------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $ (4,193,853) $ 177,165,440
-----------------------------------------------------------------------------
Capital transactions --
Contributions $ 19,489,762 $ 20,219,337
Withdrawals (38,678,708) (77,910,493)
-----------------------------------------------------------------------------
NET DECREASE IN NET ASSETS FROM
CAPITAL TRANSACTIONS $ (19,188,946) $ (57,691,156)
-----------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS $ (23,382,799) $ 119,474,284
-----------------------------------------------------------------------------
Net Assets
-----------------------------------------------------------------------------
At beginning of period $ 579,090,369 $ 459,616,085
-----------------------------------------------------------------------------
AT END OF PERIOD $ 555,707,570 $ 579,090,369
-----------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
FINANCIAL STATEMENTS CONT'D
SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2000 --------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
--------------------------------------------------------------------------------------------------------------------
Ratios (As a percentage of average
net assets):
Operating expenses 0.73%(1) 0.72% 0.72% 0.74% 0.82% 0.81%
Interest expense --(1)(2) --(2) 0.16% 0.01% 0.03% 0.03%
Net investment income 1.60%(1) 1.68% 3.13% 4.42% 5.94% 4.83%
Portfolio Turnover 59% 93% 78% 169% 166% 103%
--------------------------------------------------------------------------------------------------------------------
NET ASSETS, END OF PERIOD (000'S
OMITTED) $555,708 $579,090 $459,616 $413,409 $455,067 $521,670
--------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Annualized.
(2) Represents less than 0.01%.
SEE NOTES TO FINANCIAL STATEMENTS
16
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1 Significant Accounting Policies
-------------------------------------------
Utilities Portfolio (the Portfolio), is registered under the Investment
Company Act of 1940, as amended, as a diversified open-end management
investment company. The Portfolio which was organized as a trust under the
laws of the State of New York on May 1, 1992, seeks to achieve a high level
of total return, consisting of capital appreciation and relatively
predictable income by investing principally in dividend-paying common stocks
and dividend-paying or interest-bearing securities that are convertible into
common stock. The Declaration of Trust permits the Trustees to issue
beneficial interests in the Portfolio. Under normal circumstances the
Portfolio invests at least 65% of its total assets in common stocks of
utilities companies. The following is a summary of significant accounting
policies of the Portfolio. The policies are in conformity with generally
accepted accounting principles.
A Investment Valuation -- Securities listed on securities exchanges or in the
NASDAQ National Market are valued at closing sales prices or, if there has
been no sale, at the mean between the closing bid and asked prices. Unlisted
securities are valued at the mean between the latest available bid and asked
prices. Options and financial futures contracts are valued at the last sale
price, as quoted on the principal exchange or board of trade on which such
options or contracts are traded or, in the absence of a sale, the mean
between the last bid and asked prices. Short-term obligations, maturing in
60 days or less, are valued at amortized cost, which approximates value.
Other fixed income and debt securities, including listed securities and
securities for which price quotations are available, will normally be valued
on the basis of valuations furnished by a pricing service. Securities for
which market quotations are unavailable are appraised at their fair value as
determined in good faith by or at the direction of the Trustees.
B Income -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or discount when required for federal
income tax purposes. Dividend income is recorded on the ex-dividend date for
dividends received in cash and/or securities. However, if the ex-dividend
date has passed, certain dividends from foreign securities are recorded as
the Portfolio is informed of the ex-dividend date. Dividend income may
include dividends that represent returns of capital for federal income tax
purposes.
C Income Taxes -- The Portfolio is treated as a partnership for federal tax
purposes. No provision is made by the Portfolio for Federal or state taxes on
any taxable income of the Portfolio because each investor in the Portfolio is
ultimately responsible for the payment of any taxes. Since one of the
Portfolio's investors is a regulated investment company that invests all or
substantially all of its assets in the Portfolio, the Portfolio normally must
satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for its investors to satisfy them.
The Portfolio will allocate at least annually among its investors each
investor's distributive share of the Portfolio's net investment income, net
realized capital gains, and any other items of income, gain, loss, deduction
or credit. Withholding taxes on foreign dividends and capital gains have been
provided for in accordance with the Portfolio's understanding of the
applicable countries' tax rules and rates.
D Foreign Currency Translation -- Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are converted each
business day into U.S. dollars based upon current exchange rates. Purchases
and sales of foreign investment securities and income and expenses are
converted into U.S. dollars based upon currency exchange rates prevailing on
the respective dates of such transactions. Recognized gains or losses on
investment transactions attributable to changes in foreign currency exchange
rates are recorded for financial statement purposes as net realized gains and
losses on investments. That portion of unrealized gains and losses on
investments that results from fluctuations in foreign currency exchange rates
is not separately disclosed.
E Option Accounting Principles -- Upon the writing of a covered call option, an
amount equal to the premium received by the Portfolio is included in the
Statement of Assets and Liabilities as a liability. The amount of the
liability is subsequently marked-to-market to reflect the current market
value of the option written in accordance with the Portfolio's policies on
investment valuations discussed above. Premiums received from writing call
options which expire are treated as realized gains. Premiums received from
writing call options which are exercised or are closed are added to or offset
against the proceeds or amount paid on the transaction to determine the
realized gain or loss. The Portfolio, as writer of a call option, may have no
control over whether the underlying securities may be sold and, as a result,
bears the market risk for an unfavorable change in the price of the
securities underlying the written option.
F Financial Futures Contracts -- Upon the entering of a financial futures
contract, the Portfolio is required to deposit an amount (initial margin)
either in cash or securities equal to a certain percentage of the
17
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
purchase price indicated in the financial futures contract. Subsequent
payments are made or received by the Portfolio (margin maintenance) each day,
dependent on the daily fluctuations in the value of the underlying security,
and are recorded for book purposes as unrealized gains or losses by the
Portfolio. The Portfolio's investment in financial futures contracts is
designed only to hedge against anticipated future changes in interest rates,
security prices, commodity prices or currency exchange rates. Should interest
rates, security prices, commodity prices or currency exchange rates move
unexpectedly, the Portfolio may not achieve the anticipated benefits of the
financial futures contracts and may realize a loss. If the Portfolio enters
into a closing transaction, the Portfolio will realize for book purposes a
gain or loss equal to the difference between the value of the financial
futures contract to sell and the financial futures contract to buy.
G Delayed Delivery Transactions -- The Portfolio may purchase or sell
securities on a when-issued or forward commitment basis. Payment and delivery
may take place at a period in time after the date of the transaction. At the
time the transaction is negotiated, the price of the security that will be
delivered and paid for is fixed. Losses may arise due to changes in the
market value of the underlying securities if the counterparty does not
perform under the contract.
H Expense Reduction -- Investors Bank & Trust Company (IBT) serves as custodian
to the Portfolio. Pursuant to the respective custodian agreements, IBT
receives a fee reduced by credits which are determined based on the average
daily cash balances the Portfolio maintains with IBT. All significant credit
balances used to reduce the Portfolio's custodian fees are reported as a
reduction of expenses on the Statement of Operations. For the six months
ended June 30, 2000, $3,598 credit balances were used to reduce the
Portfolio's custodian fee.
I Other -- Investment transactions are accounted for on a trade date basis.
Realized gains and losses are computed based on the specific identification
of the securities sold.
J Use of Estimates -- The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could
differ from those estimates.
K Interim Financial Statements -- The interim financial statements relating to
June 30, 2000 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the
Portfolio's management reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
2 Investment Adviser Fee and Other Transactions with Affiliates
-------------------------------------------
The investment adviser fee is earned by Boston Management and Research (BMR),
a wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation
for management and investment advisory services rendered to the Portfolio.
The fee is at the annual rate of 0.75% of the Portfolio's average daily net
assets up to $500 million and at reduced rates as daily net assets exceed
that level. In addition, the Trustees voted to accept a waiver of BMR's
compensation so that advisory fees paid will not exceed 0.65% on an annual
basis on assets up to $500 million and at reduced rates thereafter. For the
six months ended June 30, 2000, the fee was equivalent to 0.65% (annualized)
of the Portfolio's average daily net assets for such period and amounted to
$1,877,128. Except as to Trustees of the Portfolio who are not members of
EVM's or BMR's organization, officers and Trustees receive remuneration for
their services to the Portfolio out of such investment adviser fee. Certain
officers and Trustees of the Portfolio are officers of the above
organizations. Trustees of the Portfolio that are not affiliated with the
investment adviser may elect to defer receipt of all or a percentage of their
annual fees in accordance with the terms of the Trustees Deferred
Compensation Plan. For the six months ended June 30, 2000, no significant
amounts have been deferred.
3 Investment Transactions
-------------------------------------------
Purchases and sales of investments, other than short-term obligations,
aggregated $337,305,398 and $345,261,606, respectively.
18
<PAGE>
UTILITIES PORTFOLIO AS OF JUNE 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
4 Federal Income Tax Basis of Investments
-------------------------------------------
The cost and unrealized appreciation (depreciation) in value of the
investments owned at June 30, 2000, as computed on a federal income tax
basis, were as follows:
<TABLE>
<S> <C>
AGGREGATE COST $459,695,916
------------------------------------------------------
Gross unrealized appreciation $123,024,772
Gross unrealized depreciation (23,440,970)
------------------------------------------------------
NET UNREALIZED APPRECIATION $ 99,583,802
------------------------------------------------------
</TABLE>
5 Line of Credit
-------------------------------------------
The Portfolio participates with other portfolios and funds managed by BMR and
EVM and its affiliates in a $150 million unsecured line of credit agreement
with a group of banks. The Portfolio may temporarily borrow from the line of
credit to satisfy redemption requests or settle investment transactions.
Interest is charged to each portfolio or fund based on its borrowings at an
amount above the Eurodollar rate or Federal Funds rate. In addition, a fee
computed at an annual rate of 0.10% on the daily unused portion of the line
of credit is allocated among the participating portfolios and funds at the
end of each quarter. The average daily loan balance for the six months ended
June 30, 2000 was $376,374 and the average interest rate was 6.80%. At
June 30, 2000, the Portfolio did not have a loan outstanding under
this agreement.
6 Financial Instruments
-------------------------------------------
The Portfolio may trade in financial instruments with off-balance sheet risk
in the normal course of its investing activities to assist in managing
exposure to various market risks. These financial instruments include written
options, forward foreign currency exchange contracts, and financial futures
contracts and may involve, to a varying degree, elements of risk in excess of
the amounts recognized for financial statement purposes. The notional or
contractual amounts of these instruments represent the investment the
Portfolio has in particular classes of financial instruments and does not
necessarily represent the amounts potentially subject to risk. The
measurement of the risks associated with these instruments is meaningful only
when all related and offsetting transactions are considered. At June 30, 2000
there were no outstanding obligations under these financial instruments.
19
<PAGE>
EATON VANCE UTILITIES FUND AS OF JUNE 30, 2000
INVESTMENT MANAGEMENT
EATON VANCE UTILITIES FUND
Officers
James B. Hawkes
President and Trustee
Edward E. Smiley, Jr.
Vice President
Michael B. Terry
Vice President
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Trustees
Jessica M. Bibliowicz
President and Chief Executive Officer,
National Financial Partners
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking Emeritus, Harvard University
Graduate School of Business Administration
Norton H. Reamer
Chairman of the Board,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
Jack L. Treynor
Investment Adviser and Consultant
UTILITIES PORTFOLIO
Officers
James B. Hawkes
President and Trustee
Judith A. Saryan
Vice President and
Portfolio Manager
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Trustees
Jessica M. Bibliowicz
President and Chief Executive Officer,
National Financial Partners
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking Emeritus, Harvard University
Graduate School of Business Administration
Norton H. Reamer
Chairman of the Board,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
Jack L. Treynor
Investment Adviser and Consultant
20
<PAGE>
INVESTMENT ADVISER OF UTILITIES PORTFOLIO
BOSTON MANAGEMENT AND RESEARCH
The Eaton Vance Building
255 State Street
Boston, MA 02109
ADMINISTRATOR OF EATON VANCE UTILITIES FUND
EATON VANCE MANAGEMENT
The Eaton Vance Building
255 State Street
Boston, MA 02109
PRINCIPAL UNDERWRITER
EATON VANCE DISTRIBUTORS, INC.
The Eaton Vance Building
255 State Street
Boston, MA 02109
(617) 482-8260
CUSTODIAN
INVESTORS BANK & TRUST COMPANY
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT
PFPC, INC.
Attn: Eaton Vance Funds
P.O. Box 9653
Providence, RI 02904-9653
(800) 262-1122
EATON VANCE UTILITIES FUND
THE EATON VANCE BUILDING
255 State Street
Boston, MA 02109
--------------------------------------------------------------------------------
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its sales charges and
expenses. Please read the prospectus carefully before you invest or send
money.
--------------------------------------------------------------------------------
159-8/00 UTSRC
