<PAGE>
[LOGO] First Investors
TOTAL RETURN
GROWTH & INCOME
BLUE CHIP
UTILITIES INCOME
MID-CAP OPPORTUNITY
SPECIAL SITUATIONS
FOCUSED EQUITY
GLOBAL
EQUITY FUNDS
-------------
ANNUAL REPORT
-------------
SEPTEMBER 30, 1999
<PAGE>
EQUITY MARKET OVERVIEW
FIRST INVESTORS TOTAL RETURN FUND
FIRST INVESTORS GROWTH & INCOME FUND
FIRST INVESTORS BLUE CHIP FUND
FIRST INVESTORS UTILITIES INCOME FUND
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
FIRST INVESTORS SPECIAL SITUATIONS FUND
FIRST INVESTORS FOCUSED EQUITY FUND
FIRST INVESTORS GLOBAL FUND, INC.
Dear Investor:
We are pleased to present the annual reports for the First Investors equity
funds for the fiscal year ending September 30, 1999. Included are annual reports
for the First Investors Total Return Fund, First Investors Growth & Income Fund,
First Investors Blue Chip Fund, First Investors Utilities Income Fund, First
Investors Mid-Cap Opportunity Fund, First Investors Special Situations Fund,
First Investors Focused Equity Fund and First Investors Global Fund, Inc.
The performances of all of the equity funds were largely driven by the overall
economy. The U.S. economy, now in its ninth year of expansion, continued to show
surprising strength. The domestic economy grew at a rate of approximately 4%
during the reporting period, as measured by the increase in Gross Domestic
Product. The unemployment rate fell from 4.5% to 4.2% (a 29-year low), and 2.5
million new jobs were created. Despite rapid growth and near full employment,
inflation remained benign. As measured by the Consumer Price Index, inflation
increased from 1.5% to a still low 2.6%, primarily due to higher oil prices.
With the healthy economy as a backdrop, the performance of the U.S. stock market
was generally solid, with the Standard & Poor's 500 Index returning over 26%
during the period. However, equity returns varied significantly depending on
capitalization size and sector. Mutual fund returns varied depending on
management style, such as growth or value.
As the reporting period began, a number of persistent concerns converged to
drive down the stock market. The worldwide financial crisis that started in Asia
during the summer of 1998 spread throughout most of the world. The crisis
culminated with a 10% decline in the S&P 500, Russia's default on its sovereign
debt and the bail-out of Long-Term Capital Management, a giant U.S. hedge fund.
In response to financial market distress, the Federal Reserve lowered the
benchmark federal funds interest rate three times in an eight-week period,
creating greater liquidity in the marketplace. The Federal Reserve's
action--which was mirrored by central banks worldwide--stabilized financial
markets by year-end. With stability restored and the U.S. economy unscathed, the
equity market rebounded sharply, posting strong returns for the fourth quarter
of 1998.
Early in 1999, investors grew concerned about a possible slowing economy and a
deteriorating corporate profit outlook for the year. Investors gravitated toward
"growth" stocks, placing their bets on promising companies that they felt had
the
1
<PAGE>
EQUITY MARKET OVERVIEW (continued)
FIRST INVESTORS TOTAL RETURN FUND
FIRST INVESTORS GROWTH & INCOME FUND
FIRST INVESTORS BLUE CHIP FUND
FIRST INVESTORS UTILITIES INCOME FUND
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
FIRST INVESTORS SPECIAL SITUATIONS FUND
FIRST INVESTORS FOCUSED EQUITY FUND
FIRST INVESTORS GLOBAL FUND, INC.
potential to grow at a rate faster than that of the economy. The continued
growth of the Internet fueled the need for greater bandwidth, and high flying
Internet stocks led the equity rally. In general, the returns of stocks of large
capitalization companies outpaced those of medium capitalization and small
capitalization companies for the first quarter.
As the reporting period progressed, a number of economic influences triggered a
pronounced shift in the equity environment. The economy grew so swiftly that the
Federal Reserve became concerned about potential inflation, particularly with
respect to the tight labor market. The Fed responded by raising the federal
funds rate in June. This environment boosted the stock performances of old-line
industries whose sales jump when the economy booms and inflation rises. The
stocks of these once lagging sectors, such as metals, energy, basic materials,
chemicals, paper and other classic cyclicals produced strong gains. In a
stunning reversal, the stocks of small-cap companies outpaced the stocks of
large- and mid-cap firms. Their gains were powered by strong earnings reports
and heavy merger and acquisition activity, as promising small companies were
absorbed by larger firms.
Late in the reporting period, a number of influences caused the equity market to
pull back from its mid-year high. With the economy continuing its rapid
expansion, Federal Reserve Chairman Alan Greenspan acted to cool growth and
stave off inflation. In August, the Fed raised interest rates a second time,
partially undoing the three easing moves from last autumn. Amid this economic
uncertainty, large-cap "blue chips" suffered the most, while small-cap stocks
outperformed larger-cap stocks for the second quarter in a row. This was largely
due to improved earnings and expectations that the improvement would continue.
As we entered October, the Fed held interest rates steady; however, they
indicated a bias towards raising rates in the future.
Going forward, our long-term outlook for the equity market remains optimistic.
We are concerned about excessive valuations and record-high share prices of some
stocks. As demonstrated in the past, the stock market is inherently volatile,
and significant short-term corrections are part of its nature. However, in
general, we are encouraged by the healthy fundamentals of the domestic economy,
sustained corporate earnings and subdued inflation.
Because it is impossible to predict the future direction of the markets, even
over the short term, there are certain basic investment principles that we
encourage our shareholders to follow to reduce exposure to risk.* First, we
encourage shareholders to
2
<PAGE>
take a long-term view, and to avoid trying to time the market. Attempting to
time the market is extremely difficult, even for professional investors. Second,
we encourage our shareholders to diversify their portfolios among stock funds,
bond funds and money market funds. Third, we encourage our shareholders to
follow a regular investment plan, investing a specific amount of money at
defined intervals. This strategy is known as "dollar cost averaging." It may
help you to avoid getting caught up in the excitement of a rising market and
will reduce the risk of buying at high points.
Of course, no financial plan or program, no matter how well-designed, is
guaranteed to be successful. In addition, nothing eliminates the risk associated
with overall market trends. However, utilizing these various strategies may help
to minimize the risk by reducing the extent to which an investor may be affected
by a decline in any one security or segment of the market. If you use dollar
cost averaging, you should consider your ability to continue purchases through
periods of declining prices.
In the Portfolio Managers' letters that follow, we discuss not only performance
of the funds on an absolute basis but also relative to their Lipper Inc. "peer
groups." Lipper Inc. ("Lipper") is a leading provider of mutual fund performance
information and analysis. During 1999, Lipper instituted a new classification
system for equity mutual funds. Lipper is currently continuing to publish
information based on both the old and new classifications. Because the new
classifications were not in place when the fiscal year began and they continued
to be refined during the year, we have decided to continue to rely on the old
classifications. Thus, when we refer to Lipper peer groups in this annual
report, we are using the previous classification structure.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Patricia D. Poitra
Patricia D. Poitra
Director of Equities
First Investors Management Company, Inc.
October 29, 1999
*THERE ARE A VARIETY OF RISKS ASSOCIATED WITH INVESTING IN ALL STOCK MUTUAL
FUNDS INCLUDING MARKET RISK (THE RISK THAT THE ENTIRE STOCK MARKET WILL DECLINE
BECAUSE OF AN EVENT SUCH AS A DETERIORATION IN THE ECONOMY OR A RISE IN
INTEREST RATES), AS WELL AS SPECIAL RISKS ASSOCIATED WITH INVESTING IN CERTAIN
TYPES OF STOCK MUTUAL FUNDS, SUCH AS SMALL-CAP FUNDS AND GLOBAL FUNDS. YOU
SHOULD CONSULT YOUR PROSPECTUS FOR A PRECISE EXPLANATION OF THE RISKS
ASSOCIATED WITH YOUR FUND.
3
<PAGE>
PORTFOLIO MANAGERS' LETTER
FIRST INVESTORS TOTAL RETURN FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Total Return
Fund for the fiscal year ending September 30, 1999. During the period, the
Fund's return on a net asset value basis was 11.5% for Class A shares and 10.7%
for Class B shares, compared to a return of 15.5% for the Lipper flexible funds
group. During the period, the Fund declared dividends from net investment income
of 30.3 cents per share on Class A shares and 21.5 cents per share on Class B
shares. The Fund also declared a capital gains distribution of $1.179 per share
on Class A and Class B shares.
During the reporting period, the stock and bond markets provided contrasting
returns. The performance of the U.S. stock market was generally solid, with the
S&P 500 returning over 26% during the period. However, the U.S. bond market
struggled for much of the period, and in the aggregate, provided slightly
negative returns. Within the stock market, returns varied significantly
depending on capitalization size and sector. Mutual fund returns varied
depending on management style, such as growth or value.
With varied performance among asset classes, asset allocation was the key factor
that determined the Fund's performance. At the beginning of the reporting
period, the Fund maintained an asset allocation of 53% stocks, 45% bonds and 2%
cash. In December 1998, apparent stability in the financial markets and the
recovery in the stock market led to a decision to reallocate to 60% stocks, 38%
bonds and 2% cash. In May 1999, in response to the continued favorable stock
market outlook, the Fund again increased its stock holdings while lowering its
bond holdings, targeting an asset allocation of 65% stocks, 33% bonds and 2%
cash. The Fund maintained that allocation goal through the end of the reporting
period.
Throughout the review period, the Fund's stock holdings were concentrated
primarily in large capitalization stocks. Bond holdings began the period divided
primarily among investment grade and high yield corporate debt and U.S. Treasury
and Agency debt. As the trend toward higher rates became apparent, the Treasury
and Agency holdings were shifted into mortgage-backed bonds.
Early in the reporting period, performance was hurt somewhat by an
underweighting in equities, as the stock market recovered from its sell-off in
the fall. Performance was also negatively impacted by U.S. Treasury and Agency
holdings when interest rates rose as financial markets stabilized. The Fund's
continued slight underweight allocation in stocks and substantial overweight
position in bonds hindered performance, until the allocation was changed in May.
In the
4
<PAGE>
rising interest rate environment, U.S. Treasury and Agency holdings, although
reduced, continued to be a drag on performance. The strong relative performance
of individual equity holdings in the Fund helped performance. During the third
quarter, the underperformance of large capitalization stocks relative to other
equity sectors hurt the Fund's performance. However, the gradual shift of bond
holdings from Treasuries to mortgage-backed bonds enhanced returns.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Nancy W. Jones
Nancy W. Jones
Vice President
and Co-Portfolio Manager
/s/ Patricia D. Poitra
Patricia D. Poitra
Director of Equities
and Co-Portfolio Manager
/s/ Clark D. Wagner
Clark D. Wagner
Chief Investment Officer
and Co-Portfolio Manager
October 29, 1999
5
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS TOTAL RETURN FUND
Comparison of change in value of $10,000 investment in the First Investors Total
Return Fund (Class A shares), Lehman Brothers Government/Corporate Bond Index
and the Standard & Poor's 500 Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 TOTAL RETURN FUND LEHMAN GOV/CORP S&P 500
<S> <C> <C> <C>
Apr-90 9,375 10,000 10,000
Dec-90 9,543 10,829 10,265
Dec-91 11,606 12,576 13,393
Dec-92 11,489 13,528 14,413
Dec-93 12,314 15,024 15,863
Dec-94 11,879 14,497 16,072
Dec-95 15,065 17,286 22,112
Dec-96 16,665 17,787 27,189
Dec-97 19,678 19,523 36,261
Sep-98 20,615 21,345 38,448
Sep-99 22,985 20,999 49,137
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 11.50% 4.54%
Five Years 13.60% 12.13%
Since Inception (4/24/90) 9.96% 9.22%
Class B Shares
One Year 10.72% 6.72%
Since Inception (1/12/95) 14.19% 13.93%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS TOTAL RETURN
FUND (CLASS A SHARES) BEGINNING 4/24/90 (INCEPTION DATE) WITH THEORETICAL
INVESTMENTS IN THE LEHMAN BROTHERS GOVERNMENT/ CORPORATE BOND INDEX AND THE
STANDARD & POOR'S 500 INDEX. THE LEHMAN BROTHERS GOVERNMENT/CORPORATE BOND
INDEX COMBINES THE LEHMAN BROTHERS GOVERNMENT BOND INDEX WITH THE LEHMAN
BROTHERS CORPORATE BOND INDEX. THE GOVERNMENT BOND INDEX IS MADE UP OF THE
TREASURY BOND INDEX (ALL PUBLIC OBLIGATIONS OF THE U.S. TREASURY) AND THE
AGENCY BOND INDEX (ALL PUBLICLY ISSUED DEBT OF U.S. GOVERNMENT AGENCIES AND
QUASI-FEDERAL CORPORATIONS, AND CORPORATE DEBT GUARANTEED BY THE U.S.
GOVERNMENT). THE CORPORATE BOND INDEX INCLUDES ALL PUBLICLY ISSUED,
FIXED-RATE, NONCONVERTIBLE INVESTMENT GRADE DOLLAR-DENOMINATED, S.E.C.-
REGISTERED CORPORATE DEBT. THE STANDARD & POOR'S 500 INDEX IS AN UNMANAGED
CAPITALIZATION-WEIGHTED INDEX OF 500 STOCKS DESIGNED TO MEASURE PERFORMANCE OF
THE BROAD DOMESTIC ECONOMY THROUGH CHANGES IN THE AGGREGATE MARKET VALUE OF
SUCH STOCKS, WHICH REPRESENT ALL MAJOR INDUSTRIES. IT IS NOT POSSIBLE TO
INVEST DIRECTLY IN THESE INDICES. IN ADDITION, THE INDICES DO NOT TAKE INTO
ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE GRAPH AND THE ACCOMPANYING
TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN ASSUMED THAT THE MAXIMUM SALES
CHARGE WAS DEDUCTED FROM THE INITIAL $10,000 INVESTMENT IN THE FUND AND ALL
DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED. CLASS B SHARES PERFORMANCE MAY BE
GREATER THAN OR LESS THAN THAT SHOWN IN THE LINE GRAPH ABOVE FOR CLASS A
SHARES BASED ON DIFFERENCES IN SALES LOADS AND FEES PAID BY SHAREHOLDERS
INVESTING IN THE DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25% (PRIOR TO 7/1/93, THE
MAXIMUM SALES CHARGE WAS 6.9%). THE CLASS B "S.E.C. STANDARDIZED" RETURNS ARE
ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE (MAXIMUM OF 4% IN THE FIRST
YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND WERE WAIVED OR ASSUMED. IF SUCH
EXPENSES HAD BEEN PAID BY THE FUND, THE CLASS A "S.E.C. STANDARDIZED" AVERAGE
ANNUAL TOTAL RETURN FOR ONE YEAR, FIVE YEARS AND SINCE INCEPTION WOULD HAVE
BEEN 4.30%, 11.90% AND 8.81%, RESPECTIVELY. THE CLASS B "S.E.C. STANDARDIZED"
AVERAGE ANNUAL TOTAL RETURN FOR ONE YEAR AND SINCE INCEPTION WOULD HAVE BEEN
6.43% AND 13.36%, RESPECTIVELY. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT
INDICATE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL COST. LEHMAN BROTHERS GOVERNMENT/
CORPORATE BOND INDEX FIGURES FROM LEHMAN BROTHERS, INC., STANDARD & POOR'S 500
INDEX FIGURES FROM STANDARD & POOR'S AND ALL OTHER FIGURES FROM FIRST
INVESTORS MANAGEMENT COMPANY, INC.
6
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS TOTAL RETURN FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--63.8%
BASIC MATERIALS--1.1%
6,500 Dow Chemical Company $ 738,562 $ 73
9,300 Praxair, Inc. 427,800 42
- -------------------------------------------------------------------------------------
1,166,362 115
- -------------------------------------------------------------------------------------
CAPITAL GOODS--7.5%
17,200 Allied Signal, Inc. 1,030,925 102
18,400 Boeing Company 784,300 77
11,900 Corning, Inc. 815,894 80
9,800 General Dynamics Corporation 611,887 60
15,300 General Electric Company 1,814,006 179
9,900 Illinois Tool Works, Inc. 738,169 73
9,700 Minnesota Mining and Manufacturing Company 931,806 92
14,800 United Technologies Corporation 877,825 86
- -------------------------------------------------------------------------------------
7,604,812 749
- -------------------------------------------------------------------------------------
COMMUNICATION SERVICES--3.8%
18,000 Bell Atlantic Corporation 1,211,625 119
9,900 GTE Corporation 761,062 75
15,360 *MCI WorldCom, Inc. 1,104,000 109
15,300 SBC Communications, Inc. 781,256 77
- -------------------------------------------------------------------------------------
3,857,943 380
- -------------------------------------------------------------------------------------
CONSUMER CYCLICALS--5.4%
14,200 *Abercrombie & Fitch Company - Class "A" 483,687 48
5,600 *Amazon.com, Inc. 446,600 44
9,500 *Best Buy Company, Inc. 589,594 58
15,800 *CheckFree Holdings Corporation 649,775 64
21,900 Family Dollar Stores, Inc. 462,637 46
14,000 Gannett Company, Inc. 968,625 95
15,700 Hertz Corporation - Class "A" 690,800 68
24,000 Wal-Mart Stores, Inc. 1,141,500 112
- -------------------------------------------------------------------------------------
5,433,218 535
- -------------------------------------------------------------------------------------
CONSUMER STAPLES--5.7%
23,400 *AT&T Corp. - Liberty Media Group - Class "A" 868,725 86
19,600 Estee Lauder Companies, Inc. - Class "A" 765,625 75
8,600 General Mills, Inc. 697,675 69
21,200 McDonald's Corporation 911,600 90
- -------------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES (continued)
25,900 PepsiCo, Inc. $ 783,475 $ 77
15,800 Procter & Gamble Company 1,481,250 146
7,300 *Viacom, Inc. - Class "B" 308,425 30
- -------------------------------------------------------------------------------------
5,816,775 573
- -------------------------------------------------------------------------------------
ENERGY--3.8%
7,000 Chevron Corporation 621,250 61
14,800 Exxon Corporation 1,123,875 111
7,300 Mobil Corporation 735,475 72
16,000 Occidental Petroleum Corporation 370,000 36
16,400 Royal Dutch Petroleum Company - NY Shares (ADR) 968,625 95
- -------------------------------------------------------------------------------------
3,819,225 375
- -------------------------------------------------------------------------------------
FINANCIAL--8.9%
7,300 American Express Company 982,763 97
12,000 American International Group, Inc. 1,043,250 103
17,200 Charles Schwab Corporation 579,425 57
9,400 Chase Manhattan Corporation 708,525 70
17,200 Citigroup, Inc. 756,800 75
21,600 Household International, Inc. 866,700 85
11,300 Kimco Realty Corporation 403,975 40
17,100 MBNA Corporation 390,094 38
16,000 *Net.B@nk, Inc. 354,000 35
4,300 Providian Financial Corporation 340,506 34
32,400 SLM Holding Corporation 1,393,200 137
24,400 St. Paul Companies, Inc. 671,000 66
9,000 SunTrust Banks, Inc. 591,750 58
- -------------------------------------------------------------------------------------
9,081,988 895
- -------------------------------------------------------------------------------------
HEALTHCARE--7.3%
19,300 Abbott Laboratories 709,275 70
7,100 Allergan, Inc. 781,000 77
9,800 Bristol-Myers Squibb Company 661,500 65
7,700 Cardinal Health, Inc. 419,650 41
17,000 Eli Lilly and Company 1,088,000 107
8,100 Johnson & Johnson 744,188 73
16,000 *MedQuist, Inc. 535,000 53
19,400 Medtronic, Inc. 688,700 68
- -------------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
HEALTHCARE (continued)
19,700 Pfizer, Inc. $ 707,969 $ 70
17,000 Warner-Lambert Company 1,128,375 111
- -------------------------------------------------------------------------------------
7,463,657 735
- -------------------------------------------------------------------------------------
TECHNOLOGY--18.0%
28,800 *Advanced Fibre Communications, Inc. 640,800 63
12,400 *Altera Corporation 537,850 53
14,500 *Applied Materials, Inc. 1,129,188 111
21,000 Automatic Data Processing, Inc. 937,125 92
58,800 *Cadence Design Systems, Inc. 779,100 77
28,000 *CIENA Corporation 1,022,000 101
24,250 *Cisco Systems, Inc. 1,662,641 164
6,000 *Citrix Systems, Inc. 371,625 37
28,400 *Compuware Corporation 740,175 73
24,000 *Cypress Semiconductor Corporation 516,000 51
4,000 *Dell Computer Corporation 167,250 16
4,000 *EMC Corporation 285,750 28
10,600 *Exodus Communications, Inc. 763,863 75
16,900 *Jabil Circuit, Inc. 836,550 82
14,300 *Micron Electronics, Inc. 150,150 15
10,000 *Microsoft Corporation 905,625 89
4,100 Motorola, Inc. 360,800 36
17,600 *Oracle Corporation 800,800 79
44,300 *Symantec Corporation 1,593,418 157
8,800 *Tellabs, Inc. 501,050 49
19,300 *Teradyne, Inc. 680,325 67
16,100 Texas Instruments, Inc. 1,324,225 130
24,000 *USWeb Corporation 823,500 81
16,400 *WebTrends Corporation 730,825 72
- -------------------------------------------------------------------------------------
18,260,635 1,798
- -------------------------------------------------------------------------------------
TRANSPORTATION--1.0%
26,700 CNF Transportation, Inc. 994,575 98
- -------------------------------------------------------------------------------------
UTILITIES--1.3%
19,800 Enron Corporation 816,750 80
20,000 Potomac Electric Power Company 508,750 50
- -------------------------------------------------------------------------------------
1,325,500 130
- -------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $52,199,078) 64,824,690 6,383
- -------------------------------------------------------------------------------------
</TABLE>
9
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
CORPORATE BONDS--16.3%
APPAREL/TEXTILES--.4%
$ 500M Westpoint Stevens, Inc., 7.875%, 2008 $ 450,000 $ 44
- -------------------------------------------------------------------------------------
AUTOMOTIVE--.5%
500M Titan International, Inc., 8.75%, 2007 486,250 48
- -------------------------------------------------------------------------------------
BUILDING MATERIALS--.8%
1,000M Interface, Inc., 7.30%, 2008 853,750 84
- -------------------------------------------------------------------------------------
CHEMICALS--.7%
650M Huntsman Polymers Corp., 11.75%, 2004 679,250 67
- -------------------------------------------------------------------------------------
CONTAINERS/PACKAGING--.5%
500M PrintPack, Inc., 9.875%, 2004 491,250 49
- -------------------------------------------------------------------------------------
ELECTRIC & GAS UTILITIES--.4%
375M Niagra Mohawk Power Co., 7.625%, 2005 378,334 37
- -------------------------------------------------------------------------------------
ENERGY EXPLORATION/PRODUCTS--1.0%
1,000M Gulf Canada Resources, Ltd., 8.35%, 2006 977,500 96
- -------------------------------------------------------------------------------------
ENTERTAINMENT/LEISURE--.8%
1,000M AMC Entertainment, Inc., 9.50%, 2009 835,000 82
- -------------------------------------------------------------------------------------
FOOD/BEVERAGE/TOBACCO--.6%
600M Universal Corp., 9.25%, 2001 618,918 61
- -------------------------------------------------------------------------------------
GAS TRANSMISSION--1.0%
1,000M Enron Corp., 7.125%, 2007 976,518 96
- -------------------------------------------------------------------------------------
INSURANCE--1.0%
1,000M First Colony Corp., 6.625%, 2003 1,003,540 99
- -------------------------------------------------------------------------------------
INVESTMENT/FINANCE COMPANIES--3.4%
1,000M Ford Motor Credit Co., 6.625%, 2003 993,578 98
1,000M International Lease Finance Corp., 6.375%, 2002 998,684 98
1,500M Telesis Autumn Leaves Ltd. Variable Rate Demand
Note, 5.45%, 2004** 1,500,000 148
- -------------------------------------------------------------------------------------
3,492,262 344
- -------------------------------------------------------------------------------------
MISCELLANEOUS--.9%
1,000M Allied Waste North America, Inc., 7.625%, 2006 895,000 88
- -------------------------------------------------------------------------------------
</TABLE>
10
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
RETAIL-GENERAL MERCHANDISE--1.0%
$ 1,000M Federated Department Stores, Inc., 7.45%, 2017 $ 967,842 $ 95
- -------------------------------------------------------------------------------------
TECHNOLOGY--.9%
1,000M Rhythms NetCommunications, Inc., 12.75%, 2009
(Note 6) 905,000 89
- -------------------------------------------------------------------------------------
TELECOMMUNICATIONS--1.4%
1,000M MCI WorldCom, Inc., 6.40%, 2005 977,151 96
500M TCI Communications, Inc., 6.375%, 2003 494,821 49
- -------------------------------------------------------------------------------------
1,471,972 145
- -------------------------------------------------------------------------------------
TRANSPORTATION--1.0%
1,000M Norfolk Southern Corp., 6.95%, 2002 1,003,855 99
- -------------------------------------------------------------------------------------
TOTAL VALUE OF CORPORATE BONDS (cost $17,335,460) 16,486,241 1,623
- -------------------------------------------------------------------------------------
MORTGAGE-BACKED CERTIFICATES--17.8%
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION I
PROGRAM--14.5%
14,948M 7.00%, 2/15/2028-10/1/2029 14,687,776 1,447
- -------------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION II
PROGRAM--3.3%
3,756M 5.50%, 12/20/2028-2/20/2029 3,374,919 332
- -------------------------------------------------------------------------------------
TOTAL VALUE OF MORTGAGE-BACKED CERTIFICATES
(cost $18,545,943) 18,062,695 1,779
- -------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--5.4%
5,500M Metlife Funding, Inc., 5.32%, 10/5/99
(cost $5,496,747) 5,496,747 541
- -------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $93,577,228) 103.3% 104,870,373 10,326
EXCESS OF LIABILITIES OVER OTHER ASSETS (3.3) (3,313,095) (326)
- -------------------------------------------------------------------------------------
NET ASSETS 100.0% $101,557,278 $ 10,000
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
** The interest rate on the variable rate demand note is determined and reset
weekly by the issuer.
The interest rate shown is the rate in effect at September 30, 1999.
See notes to financial statements
11
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS GROWTH & INCOME FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Growth &
Income Fund for the fiscal year ending September 30, 1999. During the period,
the Fund's return on a net asset value basis was 23.8% for Class A shares and
22.8% for Class B shares, compared to a return of 20.6% for the Lipper growth
and income funds group. During the period, the Fund declared dividends from net
investment income of 4.3 cents per share on Class A shares and .2 cents per
share on Class B shares. The Fund also declared a capital gains distribution of
.2 cents per share on Class A and Class B shares.
The primary factors driving the Fund's performance were the generally solid
performance of the equity market, as well as the Fund's sector allocations. The
Fund benefited from the equity markets' continued upward trend, which was
supported by continued gains in productivity. This in turn led to an improving
corporate earnings environment. Concerns about inflation and rising interest
rates returned mid-year and effectively cooled the markets. In general, the
performance of the major indexes was driven by large-cap technology issues. The
economy and financial markets are still debating the possible emergence of a
"new paradigm" created by massive leaps forward in computer technologies. These
technologies have made possible a heightened level of productivity, which some
believe may render the historically perceived trade-off between inflation and
unemployment invalid. However, the debate on this topic continues.
A number of holdings in the technology sector helped the Fund's performance
during the reporting period. Advanced Fiber Communications and Nortel Networks
advanced due to continued spending by the telecommunications carriers to meet
the burgeoning need for bandwidth and capacity. Driven by the needs of the
telecommunications industry, performance of semiconductor chip makers improved,
particularly the stocks of Texas Instruments and Xilinx. Also benefiting from
the improvement in the semiconductor cycle were semiconductor capital equipment
companies such as Applied Materials. In meeting the software demand driven by
hardware upgrades, computer software and services companies, such as Microsoft
and Symantec, performed well.
The Fund's holdings in the communication services sector aided the Fund's
performance. The growth of wireless communications continued to propel the
industry forward. MCI WorldCom's solid stock performance was driven by the
company's ability to capitalize on an increase in voice and data communications
traffic. Regional Bell operating companies, such as GTE Corporation and Bell
Atlantic, generated solid stock price performance, benefiting from strength in
the
12
<PAGE>
local telecommunications industry and the near term possibility of entering the
long distance market.
The Fund likewise benefited from the strong performance of several holdings in
the basic materials sector. Alcoa benefited from major cost restructuring and
industry consolidation. Dow Chemical also benefited from a restructuring, as
well as a broad product offering in the chemical and petro-chemical industry.
The Fund's holdings of stocks in the capital goods sector also enjoyed healthy
performances during the reporting period. General Electric, a well-managed and
diversified industrial company, benefited from the strength of the domestic
economy and the more recent re-invigoration of the world economies. Honeywell,
another diversified company, agreed to be acquired by Allied Signal, generating
a solid return for the stock.
In the consumer staples area, AT&T Corp.-Liberty Media's focus on cable helped
it become one of the year's solid performers. Viacom, a major entertainment
content provider, continued to reap the rewards of the expanding cable and home
entertainment market. Household product makers Procter & Gamble and Estee Lauder
benefited from the continued strength in domestic spending.
The Fund's holdings in some sectors did not benefit performance. In the health
care sector, the Federal Reserve's decision to raise interest rates had a major
impact on some of the major pharmaceutical companies with higher price-to-
earnings multiples. The stocks of companies such as Eli Lilly, Schering Plough,
American Home Products, Warner Lambert, Abbott Laboratories and Pfizer all
underperformed. Concerns about procedure reimbursement and possible accounting
issues dramatically drove down the stock of Total Renal Care, a dialysis
outsourcing company. The Fund sold its position in the stock on the news.
In the financial services sector, concerns about merger integration, potential
Year 2000 computer glitches, rising interest rates, exposure to Latin America
and declining revenues in the capital markets caused turmoil. In this
environment, stocks in companies such as Bank One, U.S. Bancorp, Summit Bancorp,
First Union and Hibernia all underperformed for the year. In the insurance
industry, it was a case of "too many fishermen in the pond." Pricing pressures
have continued to depress the stocks of insurance companies like Ace Ltd., St.
Paul Companies and the Reliance Group Holdings. The rising interest rate
environment had a detrimental effect on savings and loan institutions like
Washington Mutual and Charter One Financial.
13
<PAGE>
PORTFOLIO MANAGER'S LETTER (continued)
FIRST INVESTORS GROWTH & INCOME FUND
Going forward, we anticipate continued volatility in the equity markets. The Fed
may once again raise short-term interest rates, resulting in a weakened dollar.
The foreign economies should continue to improve, with slight improvement in the
domestic trade deficit. There should be solid earnings improvement, with
continued merger and acquisition activity, especially in areas of extreme
overcapacity, such as financial services.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Dennis T. Fitzpatrick
Dennis T. Fitzpatrick
Vice President
and Portfolio Manager
October 29, 1999
14
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS GROWTH & INCOME FUND
Comparison of change in value of $10,000 investment in the First Investors
Growth & Income Fund (Class A shares) and the Standard & Poor's 500 Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 GROWTH & INCOME FUND S & P 500
<S> <C> <C> <C>
Oct-93 9,375 10,000
Oct-94 9,723 10,541
Oct-95 11,620 13,329
Oct-96 14,155 16,540
Oct-97 17,864 21,852
Sep-98 19,443 24,652
Sep-99 24,060 31,506
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 23.75% 16.02%
Five Years 20.10% 18.57%
Since Inception (10/4/93) 17.04% 15.78%
Class B Shares
One Year 22.77% 18.77%
Since Inception (1/12/95) 21.13% 20.92%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS GROWTH & INCOME
FUND (CLASS A SHARES) BEGINNING 10/4/93 (INCEPTION DATE) WITH A THEORETICAL
INVESTMENT IN THE STANDARD & POOR'S 500 INDEX. THE STANDARD & POOR'S 500 INDEX
IS AN UNMANAGED CAPITALIZATION-WEIGHTED INDEX OF 500 STOCKS DESIGNED TO
MEASURE PERFORMANCE OF THE BROAD DOMESTIC ECONOMY THROUGH CHANGES IN THE
AGGREGATE MARKET VALUE OF SUCH STOCKS, WHICH REPRESENT ALL MAJOR INDUSTRIES.
IT IS NOT POSSIBLE TO INVEST DIRECTLY IN THIS INDEX. IN ADDITION, THE INDEX
DOES NOT TAKE INTO ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE GRAPH AND
THE ACCOMPANYING TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN ASSUMED THAT
THE MAXIMUM SALES CHARGE WAS DEDUCTED FROM THE INITIAL $10,000 INVESTMENT IN
THE FUND AND ALL DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED. CLASS B SHARES
PERFORMANCE MAY BE GREATER THAN OR LESS THAN THAT SHOWN IN THE LINE GRAPH
ABOVE FOR CLASS A SHARES BASED ON DIFFERENCES IN SALES LOADS AND FEES PAID BY
SHAREHOLDERS INVESTING IN THE DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25%. THE CLASS B "S.E.C.
STANDARDIZED" RETURNS ARE ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE
(MAXIMUM OF 4% IN THE FIRST YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND
WERE WAIVED OR ASSUMED. IF SUCH EXPENSES HAD BEEN PAID BY THE FUND, THE
CLASS A "S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN FOR FIVE YEARS AND
SINCE INCEPTION WOULD HAVE BEEN 18.17% AND 15.32%, RESPECTIVELY. THE CLASS B
"S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN SINCE INCEPTION WOULD HAVE
BEEN 20.38%. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE
RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE
SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THE ORIGINAL COST. STANDARD & POOR'S 500 INDEX FIGURES FROM STANDARD & POOR'S
AND ALL OTHER FIGURES FROM FIRST INVESTORS MANAGEMENT COMPANY, INC.
15
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS GROWTH & INCOME FUND
September 30, 1999
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- ---------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--92.0%
BASIC MATERIALS--2.3%
50,000 Dow Chemical Company $ 5,681,250 $ 125
75,000 Newmont Mining Corporation 1,940,625 43
60,000 Praxair, Inc. 2,760,000 61
- ---------------------------------------------------------------------------------------
10,381,875 229
- ---------------------------------------------------------------------------------------
CAPITAL GOODS--12.1%
115,000 Allied Signal, Inc. 6,892,812 151
118,200 Boeing Company 5,038,275 111
81,000 Corning, Inc. 5,553,562 122
63,000 General Dynamics Corporation 3,933,562 86
95,000 General Electric Company 11,263,437 248
62,000 Illinois Tool Works, Inc. 4,622,875 102
60,000 Minnesota Mining and Manufacturing Company 5,763,750 127
66,000 Tyco International, Ltd. 6,814,500 150
91,000 United Technologies Corporation 5,397,437 119
- ---------------------------------------------------------------------------------------
55,280,210 1,216
- ---------------------------------------------------------------------------------------
COMMUNICATION SERVICES--5.4%
120,000 Bell Atlantic Corporation 8,077,500 178
62,000 GTE Corporation 4,766,250 105
95,000 *MCI WorldCom, Inc. 6,828,125 150
95,000 SBC Communications, Inc. 4,850,937 107
- ---------------------------------------------------------------------------------------
24,522,812 540
- ---------------------------------------------------------------------------------------
CONSUMER CYCLICALS--7.5%
128,900 *Abercrombie & Fitch Company - Class "A" 4,390,656 96
34,400 *Amazon.com, Inc. 2,743,400 60
60,000 *Best Buy Company, Inc. 3,723,750 82
101,800 *CheckFree Holdings Corporation 4,186,525 92
150,000 Family Dollar Stores, Inc. 3,168,750 70
87,000 Gannett Company, Inc. 6,019,312 132
61,000 Hertz Corporation - Class "A" 2,684,000 59
150,000 Wal-Mart Stores, Inc. 7,134,375 157
- ---------------------------------------------------------------------------------------
34,050,768 748
- ---------------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- ---------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES--8.0%
146,000 *AT&T Corp. - Liberty Media Group - Class "A" $ 5,420,250 $ 119
122,000 Estee Lauder Companies, Inc. - Class "A" 4,765,625 105
53,000 General Mills, Inc. 4,299,625 94
132,000 McDonald's Corporation 5,676,000 125
161,000 PepsiCo, Inc. 4,870,250 107
100,000 Procter & Gamble Company 9,375,000 206
45,000 *Viacom, Inc. - Class "B" 1,901,250 42
- ---------------------------------------------------------------------------------------
36,308,000 798
- ---------------------------------------------------------------------------------------
ENERGY--5.4%
45,000 Chevron Corporation 3,993,750 88
92,000 Exxon Corporation 6,986,250 154
45,000 Mobil Corporation 4,533,750 100
100,000 Occidental Petroleum Corporation 2,312,500 51
115,000 Royal Dutch Petroleum Company - NY Shares (ADR) 6,792,187 149
- ---------------------------------------------------------------------------------------
24,618,437 542
- ---------------------------------------------------------------------------------------
FINANCIAL--12.3%
50,000 American Express Company 6,731,250 148
74,750 American International Group, Inc. 6,498,578 143
110,000 Charles Schwab Corporation 3,705,625 81
58,800 Chase Manhattan Corporation 4,432,050 97
107,500 Citigroup, Inc. 4,730,000 104
133,000 Household International, Inc. 5,336,625 117
70,000 Kimco Realty Corporation 2,502,500 55
110,000 MBNA Corporation 2,509,375 55
100,000 *Net.B@nk, Inc. 2,212,500 49
27,000 Providian Financial Corporation 2,138,063 47
200,000 SLM Holding Corporation 8,600,000 189
100,000 St. Paul Companies, Inc. 2,750,000 60
56,100 SunTrust Banks, Inc. 3,688,575 81
- ---------------------------------------------------------------------------------------
55,835,141 1,226
- ---------------------------------------------------------------------------------------
HEALTHCARE--10.5%
120,000 Abbott Laboratories 4,410,000 97
43,700 Allergan, Inc. 4,807,000 106
63,000 Bristol-Myers Squibb Company 4,252,500 93
50,000 Cardinal Health, Inc. 2,725,000 60
- ---------------------------------------------------------------------------------------
</TABLE>
17
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS GROWTH & INCOME FUND
September 30, 1999
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000 OF
SHARES SECURITY VALUE NET ASSETS
- ---------------------------------------------------------------------------------------
<C> <S> <C> <C>
HEALTHCARE (continued)
106,000 Eli Lilly and Company $ 6,784,000 $ 149
62,100 Johnson & Johnson 5,705,438 125
100,000 *MedQuist, Inc. 3,343,750 73
123,000 Medtronic, Inc. 4,366,500 96
125,000 Pfizer, Inc. 4,492,188 99
105,000 Warner-Lambert Company 6,969,375 153
- ---------------------------------------------------------------------------------------
47,855,751 1,051
- ---------------------------------------------------------------------------------------
TECHNOLOGY--25.4%
174,600 *Advanced Fibre Communications, Inc. 3,884,850 85
77,700 *Altera Corporation 3,370,238 74
150,000 *American Xtal Technology, Inc. 3,206,250 70
90,800 *Applied Materials, Inc. 7,071,050 155
130,000 Automatic Data Processing, Inc. 5,801,250 127
367,500 *Cadence Design Systems, Inc. 4,869,375 107
175,000 *CIENA Corporation 6,387,500 140
149,000 *Cisco Systems, Inc. 10,215,813 224
37,000 *Citrix Systems, Inc. 2,291,688 50
200,000 *Compuware Corporation 5,212,500 115
150,000 *Cypress Semiconductor Corporation 3,225,000 71
25,000 *Dell Computer Corporation 1,045,313 23
24,900 *EMC Corporation 1,778,794 39
66,000 *Exodus Communications, Inc. 4,756,125 105
110,000 *Jabil Circuit, Inc. 5,445,000 120
91,800 *Micron Electronics, Inc. 963,900 21
70,000 *Microsoft Corporation 6,339,375 139
26,200 Motorola, Inc. 2,305,600 51
112,800 *Oracle Corporation 5,132,400 113
273,800 *Symantec Corporation 9,848,257 216
55,000 *Tellabs, Inc. 3,131,563 69
121,400 *Teradyne, Inc. 4,279,350 94
65,800 Texas Instruments, Inc. 5,412,050 119
150,000 *USWeb Corporation 5,146,875 113
101,000 *WebTrends Corporation 4,500,813 99
- ---------------------------------------------------------------------------------------
115,620,929 2,539
- ---------------------------------------------------------------------------------------
TRANSPORTATION--1.3%
165,000 CNF Transportation, Inc. 6,146,250 135
- ---------------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------
AMOUNT
SHARES INVESTED
OR FOR EACH
PRINCIPAL $10,000 OF
AMOUNT SECURITY VALUE NET ASSETS
- ---------------------------------------------------------------------------------------
<C> <S> <C> <C>
UTILITIES--1.8%
122,400 Enron Corporation $ 5,049,000 $ 111
125,000 Potomac Electric Power Company 3,179,688 70
- ---------------------------------------------------------------------------------------
8,228,688 181
- ---------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $323,236,859) 418,848,861 9,205
- ---------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--1.1%
FINANCIAL--.4%
100,000 Lincoln National Corporation, 7.75%, 8/16/01 2,093,750 46
- ---------------------------------------------------------------------------------------
TECHNOLOGY--.7%
30,000 Microsoft Corporation, 2.196%, 12/15/99 3,020,625 66
- ---------------------------------------------------------------------------------------
TOTAL VALUE OF CONVERTIBLE PREFERRED STOCKS
(cost $5,008,674) 5,114,375 112
- ---------------------------------------------------------------------------------------
CONVERTIBLE BONDS--2.0%
CONSUMER CYCLICALS--1.5%
$1,600M Home Depot, Inc., 3.25%, 2001 4,746,000 104
2,500M Sportsline USA, 5%, 2006 1,875,000 41
- ---------------------------------------------------------------------------------------
6,621,000 145
- ---------------------------------------------------------------------------------------
HEALTHCARE--.5%
3,000M Healthsouth Corp., 3.25%, 2003 2,336,250 52
- ---------------------------------------------------------------------------------------
TOTAL VALUE OF CONVERTIBLE BONDS (cost $7,086,250) 8,957,250 197
- ---------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--5.5%
9,100M Bell Atlantic Corp., 5.29%, 10/27/99 9,065,182 199
3,000M BellSouth Telecommunications, Inc., 5.28%,
10/6/99 2,997,795 66
5,000M Halliburton Co., 5.29%, 10/26/99 4,981,613 110
5,000M Motorola Credit Co., 5.28%, 10/28/99 4,980,191 109
2,000M Toyota Motor Credit Co., 5.28%, 10/14/99 1,996,179 44
1,000M Toyota Motor Credit Co., 5.28%, 10/21/99 997,063 22
- ---------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $25,018,023) 25,018,023 550
- ---------------------------------------------------------------------------------------
TOTAL VALUE OF INVESTMENTS (cost $360,349,806) 100.6% 457,938,509 10,064
EXCESS OF LIABILITIES OVER OTHER ASSETS (.6) (2,930,070) (64)
- ---------------------------------------------------------------------------------------
NET ASSETS 100.0% $455,008,439 $10,000
- ---------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
19
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS BLUE CHIP FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Blue Chip
Fund for the fiscal year ending September 30, 1999. During the period, the
Fund's return on a net asset value basis was 24.9% for Class A shares and 24.1%
for Class B shares, compared to a return of 20.6% for the Lipper growth and
income fund group. During the period, the Fund declared dividends from net
investment income of 1 cent per share on Class A shares. The Fund also declared
a capital gains distribution of 70 cents per share on Class A and Class B
shares.
The primary factors driving the Fund's performance were the performance of large
capitalization stocks, as well as the Fund's sector allocations. The Fund
benefited from the equity markets' continued upward trend, which was supported
by continued gains in productivity. This in turn led to an improving corporate
earnings environment. Concerns about inflation and rising interest rates
returned mid-year and effectively cooled the markets. In general, the
performance of the major indexes was driven by large-cap technology issues. The
economy and financial markets are still debating the possible emergence of a
"new paradigm" created by massive leaps forward in computer technologies. These
technologies have made possible a heightened level of productivity, which some
believe may render the historically perceived trade-off between inflation and
unemployment invalid. However, the debate on this topic continues.
A number of holdings in the capital goods sector helped the Fund's performance
during the reporting period. One company that significantly contributed to
performance was General Electric, which benefited from continuing strength in
the domestic economy, as well as the recent re-invigoration of the world
economies.
The Fund's holdings in the consumer cyclicals sector also helped performance.
Solid advertising and classified revenue helped propel Tribune's newspaper
business. Its television station ratings also fared well, due to solid
demographic perspectives. The big box retailers, Home Depot, Wal-Mart and
Costco, continued to generate solid returns for the Fund by providing the
consumer with a solid shopping value and a good in-store experience.
In the consumer staples area, AT&T Corp.-Liberty Media's focus on cable helped
it become one of the year's solid performers. Time Warner, a major cable player,
was also a good performer for the Fund thanks to its improving programming
content.
20
<PAGE>
Holdings in the technology sector were also strong performers. In the handset
and wireless communications markets, Ericsson and Lucent Technologies were two
solid stocks. As the semiconductor market improved, the stocks of Intel and LSI
Logic generated out-performing returns. Also benefiting from the improvement in
the semiconductor cycle were semiconductor capital equipment companies, such as
Applied Materials.
During the reporting period, a number of holdings did not perform as well as
expected. For example, Pacific Gateway Exchange was hurt by declining prices for
undersea cable communications. Additionally, the Fund was slightly underweighted
in the high-flying communication services sector.
In the consumer cyclicals area, select sellers of hard goods were hurt by the
rising interest rate environment, though their fundamentals remained solid. An
example of this situation was the underperformance of the stock of Ford Motor
Company, a leading automobile manufacturer.
In the financial services sector, concerns about merger integration, potential
Year 2000 computer glitches, rising interest rates, exposure to Latin America
and declining revenues in the capital markets wreaked havoc. In this
environment, some of the Fund's holdings underperformed. In the insurance
industry, it was a case of "too many fishermen in the pond," as pricing
pressures continued to depress the stocks of companies like Hartford Insurance
Group.
The Fund's holdings in the health care sector did not benefit performance. The
Federal Reserve's decision to raise interest rates had a significant impact on
some of the major pharmaceutical companies with higher price-to-earnings
multiples. The stocks of companies such as Eli Lilly, Schering Plough, and
Pfizer all underperformed. Similarly, concerns about payment and Medicare reform
had a detrimental effect on the stocks of hospital companies such as Tenet
Healthcare and Health Management Associates.
Going forward, we anticipate continued volatility in the equity markets. The Fed
may once again raise short-term interest rates, resulting in a weakened dollar.
The foreign economies should continue to improve, with slight improvement in the
domestic trade deficit. There should be continued earnings improvement, with
continued merger and acquisition activity, especially in areas of extreme
overcapacity, such as financial services.
21
<PAGE>
PORTFOLIO MANAGER'S LETTER (continued)
FIRST INVESTORS BLUE CHIP FUND
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Dennis T. Fitzpatrick
Dennis T. Fitzpatrick
Vice President
and Portfolio Manager
October 29, 1999
22
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS BLUE CHIP FUND
Comparison of change in value of $10,000 investment in the First Investors Blue
Chip Fund (Class A shares) and the Standard & Poor's 500 Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 BLUE CHIP FUND S&P 500
<S> <C> <C> <C>
Jan-90 9,375 10,000
Dec-90 9,045 9,691
Dec-91 11,536 12,643
Dec-92 12,293 13,606
Dec-93 13,248 14,975
Dec-94 12,847 15,173
Dec-95 17,217 20,875
Dec-96 20,756 25,667
Dec-97 26,163 34,231
Sep-98 25,757 36,296
Sep-99 32,167 46,386
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 24.88% 17.07%
Five Years 19.80% 18.26%
Ten Years 13.33% 12.61%
Class B Shares
One Year 24.07% 20.07%
Since Inception (1/12/95) 20.58% 20.37%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS BLUE CHIP FUND
(CLASS A SHARES) BEGINNING 1/1/90 WITH A THEORETICAL INVESTMENT IN THE
STANDARD & POOR'S 500 INDEX. THE STANDARD & POOR'S 500 INDEX IS AN UNMANAGED
CAPITALIZATION-WEIGHTED INDEX OF 500 STOCKS DESIGNED TO MEASURE PERFORMANCE OF
THE BROAD DOMESTIC ECONOMY THROUGH CHANGES IN THE AGGREGATE MARKET VALUE OF
SUCH STOCKS, WHICH REPRESENT ALL MAJOR INDUSTRIES. IT IS NOT POSSIBLE TO
INVEST DIRECTLY IN THIS INDEX. IN ADDITION, THE INDEX DOES NOT TAKE INTO
ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE GRAPH AND THE ACCOMPANYING
TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN ASSUMED THAT THE MAXIMUM SALES
CHARGE WAS DEDUCTED FROM THE INITIAL $10,000 INVESTMENT IN THE FUND AND ALL
DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED. CLASS B SHARES PERFORMANCE MAY BE
GREATER THAN OR LESS THAN THAT SHOWN IN THE LINE GRAPH ABOVE FOR CLASS A
SHARES BASED ON DIFFERENCES IN SALES LOADS AND FEES PAID BY SHAREHOLDERS
INVESTING IN THE DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25% (PRIOR TO 7/1/93, THE
MAXIMUM SALES CHARGE WAS 6.9%). THE CLASS B "S.E.C. STANDARDIZED" RETURNS ARE
ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE (MAXIMUM OF 4% IN THE FIRST
YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND WERE WAIVED OR ASSUMED. IF SUCH
EXPENSES HAD BEEN PAID BY THE FUND, THE CLASS A "S.E.C. STANDARDIZED" AVERAGE
ANNUAL TOTAL RETURN FOR ONE YEAR, FIVE YEARS AND SINCE INCEPTION WOULD HAVE
BEEN 16.96%, 18.05% AND 12.23%, RESPECTIVELY. THE CLASS B "S.E.C.
STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN FOR ONE YEAR AND SINCE INCEPTION
WOULD HAVE BEEN 19.65% AND 19.85%, RESPECTIVELY. RESULTS REPRESENT PAST
PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS. INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST. STANDARD &
POOR'S 500 INDEX FIGURES FROM STANDARD & POOR'S AND ALL OTHER FIGURES FROM
FIRST INVESTORS MANAGEMENT COMPANY, INC.
23
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS BLUE CHIP FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--94.2%
BASIC MATERIALS--2.1%
52,400 Alcoa, Inc. $ 3,252,075 $ 60
66,500 Ecolab, Inc. 2,269,312 42
163,100 Mead Corporation 5,606,562 104
- --------------------------------------------------------------------------------------
11,127,949 206
- --------------------------------------------------------------------------------------
CAPITAL GOODS--9.2%
161,100 General Electric Company 19,100,419 353
134,600 Ingersoll-Rand Company 7,394,588 137
55,700 Pitney Bowes, Inc. 3,394,219 63
150,600 Tyco International, Ltd. 15,549,450 287
69,900 United Technologies Corporation 4,145,944 77
- --------------------------------------------------------------------------------------
49,584,620 917
- --------------------------------------------------------------------------------------
COMMUNICATION SERVICES--5.7%
134,200 Bell Atlantic Corporation 9,033,337 167
76,900 GTE Corporation 5,911,687 109
172,600 *MCI WorldCom, Inc. 12,405,625 229
87,400 *Pacific Gateway Exchange, Inc. 1,431,175 26
69,900 *Qwest Communications International, Inc. 2,066,419 38
- --------------------------------------------------------------------------------------
30,848,243 569
- --------------------------------------------------------------------------------------
CONSUMER CYCLICALS--11.1%
155,700 *Abercrombie & Fitch Company - Class "A" 5,303,531 98
75,000 *Best Buy Company, Inc. 4,654,687 86
122,400 *CheckFree Holdings Corporation 5,033,700 93
139,700 *Costco Wholesale Corporation 10,058,400 186
82,800 Home Depot, Inc. 5,682,150 105
141,000 Masco Corporation 4,371,000 81
120,000 McGraw-Hill Companies, Inc. 5,805,000 107
166,600 Tribune Company 8,288,350 153
232,000 Wal-Mart Stores, Inc. 11,034,500 204
- --------------------------------------------------------------------------------------
60,231,318 1,113
- --------------------------------------------------------------------------------------
CONSUMER STAPLES--12.2%
352,800 *AT&T Corp. - Liberty Media Group - Class "A" 13,097,700 242
71,500 Bestfoods 3,467,750 64
70,000 *Clear Channel Communications, Inc. 5,591,250 103
- --------------------------------------------------------------------------------------
</TABLE>
24
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES (continued)
91,900 General Mills, Inc. $ 7,455,387 $ 138
96,800 *Kroger Company 2,135,650 40
263,700 PepsiCo, Inc. 7,976,925 147
65,900 Procter & Gamble Company 6,178,125 114
161,100 *Safeway, Inc. 6,131,869 113
149,000 Time Warner, Inc. 9,051,750 167
41,428 Unilever NV - NY Shares (ADR) 2,822,282 52
52,600 *Viacom, Inc. - Class "B" 2,222,350 41
- --------------------------------------------------------------------------------------
66,131,038 1,221
- --------------------------------------------------------------------------------------
ENERGY--5.1%
176,800 Baker Hughes, Inc. 5,127,200 95
33,300 Chevron Corporation 2,955,375 55
132,900 Exxon Corporation 10,092,094 187
13,000 Mobil Corporation 1,309,750 24
139,900 Royal Dutch Petroleum Company - NY Shares (ADR) 8,262,844 153
- --------------------------------------------------------------------------------------
27,747,263 514
- --------------------------------------------------------------------------------------
FINANCIAL--10.8%
23,500 American Express Company 3,163,687 58
102,875 American International Group, Inc. 8,943,695 165
132,800 Charles Schwab Corporation 4,473,700 83
71,200 Chase Manhattan Corporation 5,366,700 99
129,500 Citigroup, Inc. 5,698,000 105
51,200 Fannie Mae 3,209,600 59
83,100 Freddie Mac 4,321,200 80
45,900 Jefferson-Pilot Corporation 2,900,306 54
175,400 MBNA Corporation 4,001,313 74
48,500 Morgan Stanley Dean Witter & Company 4,325,594 80
33,600 Providian Financial Corporation 2,660,700 49
112,600 SLM Holding Corporation 4,841,800 90
67,200 SunTrust Banks, Inc. 4,418,400 82
- --------------------------------------------------------------------------------------
58,324,695 1,078
- --------------------------------------------------------------------------------------
HEALTHCARE--9.9%
65,500 Abbott Laboratories 2,407,125 45
52,500 Allergan, Inc. 5,775,000 107
98,400 Bristol-Myers Squibb Company 6,642,000 123
- --------------------------------------------------------------------------------------
</TABLE>
25
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS BLUE CHIP FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
HEALTHCARE (continued)
46,300 Cardinal Health, Inc. $ 2,523,350 $ 47
60,400 Eli Lilly and Company 3,865,600 71
72,700 Johnson & Johnson 6,679,313 123
149,600 Medtronic, Inc. 5,310,800 98
117,700 Merck & Company, Inc. 7,628,431 141
120,900 Pfizer, Inc. 4,344,844 80
125,600 Warner-Lambert Company 8,336,700 154
- --------------------------------------------------------------------------------------
53,513,163 989
- --------------------------------------------------------------------------------------
TECHNOLOGY--26.1%
104,400 *Altera Corporation 4,528,350 84
109,500 *Applied Materials, Inc. 8,527,313 158
442,800 *Cadence Design Systems, Inc. 5,867,100 108
209,600 *CIENA Corporation 7,650,400 141
162,300 *Cisco Systems, Inc. 11,127,694 206
44,000 *Citrix Systems, Inc. 2,725,250 50
99,000 *Compuware Corporation 2,580,188 48
169,300 *Cypress Semiconductor Corporation 3,639,950 67
32,200 *EMC Corporation 2,300,288 43
73,400 *Fairchild Semiconductor International, Inc. -
Class "A" 1,724,900 32
50,100 Hewlett-Packard Company 4,609,200 85
166,100 Intel Corporation 12,343,306 228
47,000 International Business Machines Corporation 5,704,625 105
106,100 *Jabil Circuit, Inc. 5,251,950 97
153,900 *LSI Logic Corporation 7,925,850 146
115,300 Lucent Technologies, Inc. 7,480,088 138
110,600 *Micron Electronics, Inc. 1,161,300 21
104,400 *Microsoft Corporation 9,454,725 175
31,200 Motorola, Inc. 2,745,600 51
136,000 *Oracle Corporation 6,188,000 114
69,900 *Sun Microsystems, Inc. 6,500,700 120
339,700 *Symantec Corporation 12,218,601 226
70,000 *Tellabs, Inc. 3,985,625 74
146,300 *Teradyne, Inc. 5,157,075 95
- --------------------------------------------------------------------------------------
141,398,078 2,612
- --------------------------------------------------------------------------------------
</TABLE>
26
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
SHARES $10,000
OR OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
UTILITIES--2.0%
260,800 Enron Corporation $ 10,758,000 $ 199
- --------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $354,546,192) 509,664,367 9,418
- --------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--7.9%
$1,000M Ameritech Corp., 5.60%, 10/1/99 1,000,000 18
5,997M Archer-Daniels-Midland Co., 5.28%, 10/13/99 5,986,419 111
10,700M BellSouth Telecommunications, Inc., 5.28%,
10/6/99 10,692,135 198
7,300M Halliburton Co., 5.30%, 10/26/99 7,273,116 134
2,200M Heinz, H.J. Co., 5.30%, 10/12/99 2,196,425 41
2,500M Laclede Gas Co., 5.30%, 10/19/99 2,493,368 46
3,600M Paccar Financial Corp., 5.29%, 10/21/99 3,589,406 66
4,500M Toyota Motor Credit Co., 5.28%, 10/14/99 4,491,402 83
5,000M Washington Gas Light Co., 5.30%, 10/18/99 4,987,459 92
- --------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $42,709,730) 42,709,730 789
- --------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $397,255,922) 102.1% 552,374,097 10,207
EXCESS OF LIABILITIES OVER OTHER ASSETS (2.1) (11,215,147) (207)
- --------------------------------------------------------------------------------------
NET ASSETS 100.0% $541,158,950 $ 10,000
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
27
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS UTILITIES INCOME FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Utilities
Income Fund for the fiscal year ending September 30, 1999. During the period,
the Fund's return on a net asset value basis was 12.0% for Class A shares and
11.1% for Class B shares, compared to a return of 14.8% for the Lipper utility
funds group. During the period, the Fund declared dividends from net investment
income of 12.5 cents per share on Class A shares and 7.3 cents per share on
Class B shares. The Fund also declared a capital gains distribution of 37.3
cents per share on Class A and Class B shares.
Over the past year, the telecommunication sector became the key driver of
performance for the Utilities Income Fund. Early in fiscal 1999, the portfolio
was underweighted in telecommunications and, as a result, the Fund got off to a
sluggish start. We began increasing the portfolio's weighting in
telecommunication stocks late in calendar year 1998 and it has since overtaken
electric utilities as the largest sector of the Fund. Except for a pause late in
the fiscal year, telecommunication securities have been a positive contributor
to the Fund's performance.
When compared with the electric and natural gas industries, the
telecommunication industry displayed superior growth and total return
characteristics. Analysts expect this trend to continue as telecommunications
becomes further deregulated and new business opportunities arise. Perhaps the
most important of these new developments is the boom in telecommunication
traffic generated by the Internet explosion. Another key development is the
anticipated entry of the local telephone companies into the long distance market
at some point in 2000.
Electric utilities continue to be an important part of the Fund's portfolio. The
industry continued to be deregulated on a state-by-state basis over the last
year. Generally, utilities have received fair treatment by state regulators with
regard to stranded cost issues. An unprecedented amount of consolidation
occurred as companies sought to grow geographically. Electric companies have
also been active in buying natural gas utilities.
Shares of gas utilities have benefited from this consolidation, as well as from
rising natural gas prices, this past summer. We expect more mergers and
acquisitions in the electric and gas industries as more states pass deregulation
legislation.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Matthew S. Wright
Matthew S. Wright
Portfolio Manager
October 29, 1999
28
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS UTILITIES INCOME FUND
Comparison of change in value of $10,000 investment in the First Investors
Utilities Income Fund (Class A shares), the Standard & Poor's 500 Index and the
Standard & Poor's Utilities Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 UTILITIES INCOME FUND S & P 500 S & P UTILITIES
<S> <C> <C> <C>
Feb-93 9,375 10,000 10,000
Oct-93 10,112 10,955 10,774
Oct-94 9,085 11,379 8,949
Oct-95 11,025 14,388 11,618
Oct-96 12,397 17,854 12,797
Oct-97 13,992 23,588 14,066
Sep-98 16,237 26,611 18,145
Sep-99 18,183 34,009 17,923
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 11.99% 4.96%
Five Years 15.20% 13.71%
Since Inception (2/22/93) 10.54% 9.47%
Class B Shares
One Year 11.13% 7.13%
Since Inception (1/12/95) 15.30% 15.05%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS UTILITIES
INCOME FUND (CLASS A SHARES) BEGINNING 2/22/93 (INCEPTION DATE) WITH
THEORETICAL INVESTMENTS IN THE STANDARD & POOR'S 500 INDEX AND THE STANDARD &
POOR'S UTILITIES INDEX. THE STANDARD & POOR'S 500 INDEX IS AN UNMANAGED
CAPITALIZATION-WEIGHTED INDEX OF 500 STOCKS DESIGNED TO MEASURE PERFORMANCE OF
THE BROAD DOMESTIC ECONOMY THROUGH CHANGES IN THE AGGREGATE MARKET VALUE OF
SUCH STOCKS, WHICH REPRESENT ALL MAJOR INDUSTRIES. THE STANDARD & POOR'S
UTILITIES INDEX IS A CAPITALIZATION-WEIGHTED INDEX OF 37 STOCKS DESIGNED TO
MEASURE THE PERFORMANCE OF THE UTILITY SECTOR OF THE STANDARD & POOR'S 500
INDEX. IT IS NOT POSSIBLE TO INVEST DIRECTLY IN THESE INDICES. IN ADDITION,
THE INDICES DO NOT TAKE INTO ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE
GRAPH AND THE ACCOMPANYING TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN
ASSUMED THAT THE MAXIMUM SALES CHARGE WAS DEDUCTED FROM THE INITIAL $10,000
INVESTMENT IN THE FUND AND ALL DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED.
CLASS B SHARES PERFORMANCE MAY BE GREATER THAN OR LESS THAN THAT SHOWN IN THE
LINE GRAPH ABOVE FOR CLASS A SHARES BASED ON DIFFERENCES IN SALES LOADS AND
FEES PAID BY SHAREHOLDERS INVESTING IN THE DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25%. THE CLASS B "S.E.C.
STANDARDIZED" RETURNS ARE ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE
(MAXIMUM OF 4% IN THE FIRST YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND
WERE WAIVED OR ASSUMED. IF SUCH EXPENSES HAD BEEN PAID BY THE FUND, THE
CLASS A "S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN FOR FIVE YEARS AND
SINCE INCEPTION WOULD HAVE BEEN 13.21% AND 8.54%, RESPECTIVELY. THE CLASS B
"S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN SINCE INCEPTION WOULD HAVE
BEEN 14.56%. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE
RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE
SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THE ORIGINAL COST. STANDARD & POOR'S 500 INDEX AND STANDARD & POOR'S UTILITIES
INDEX FIGURES FROM STANDARD & POOR'S AND ALL OTHER FIGURES FROM FIRST
INVESTORS MANAGEMENT COMPANY, INC.
29
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS UTILITIES INCOME FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--88.9%
COMMUNICATION SERVICES--38.7%
31,600 ALLTEL Corporation $ 2,223,850 $ 134
45,000 *AT&T Canada, Inc. - Class "B" 2,826,562 171
36,450 AT&T Corporation 1,585,575 96
36,500 BCE, Inc. 1,818,156 110
79,800 Bell Atlantic Corporation 5,371,537 324
74,400 BellSouth Corporation 3,348,000 202
21,300 CenturyTel, Inc. 865,312 52
118,900 *Global Crossing, Ltd. 3,150,850 190
17,900 GTE Corporation 1,376,062 83
122,600 *ICG Communications, Inc. 1,907,962 115
112,200 *Intermedia Communications, Inc. 2,440,350 147
65,100 *IXC Communications, Inc. 2,567,381 155
68,504 *MCI WorldCom, Inc. 4,923,725 297
67,500 *McLeodUSA, Inc. - Class "A" 2,872,969 173
60,920 *Metromedia Fiber Network, Inc. 1,492,540 90
67,900 *Pacific Gateway Exchange, Inc. 1,111,862 67
74,500 *Primus Telecommunications Group, Inc. 1,564,500 94
110,230 *Qwest Communications International, Inc. 3,258,674 197
40,980 Royal PTT Nederland NV 1,823,610 110
87,800 SBC Communications, Inc. 4,483,288 271
57,400 Sprint Corporation 3,113,950 188
44,200 Telephone and Data Systems, Inc. 3,925,512 237
53,100 US West, Inc. 3,030,019 183
62,500 *Viatel, Inc. 1,847,656 112
29,300 *WinStar Communications, Inc. 1,144,531 69
- --------------------------------------------------------------------------------------
64,074,433 3,867
- --------------------------------------------------------------------------------------
FINANCIAL--1.4%
57,500 Health Care REIT, Inc. 1,150,000 69
70,800 Nationwide Health Properties, Inc. 1,177,050 71
- --------------------------------------------------------------------------------------
2,327,050 140
- --------------------------------------------------------------------------------------
UTILITIES--48.8%
49,100 Avista Corporation 862,319 52
83,600 Carolina Power & Light Company 2,957,350 179
64,000 Coastal Corporation 2,620,000 158
10,700 Columbia Energy Group 592,513 36
103,100 Conectiv, Inc. 2,023,338 122
- --------------------------------------------------------------------------------------
</TABLE>
30
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
UTILITIES (continued)
54,200 Consolidated Edison, Inc. $ 2,249,300 $ 136
102,700 DQE, Inc. 4,018,138 243
40,800 Duke Energy Corporation 2,249,100 136
105,000 Dynegy, Inc. 2,172,188 131
21,800 Eastern Enterprises 1,012,338 61
47,700 El Paso Energy Corporation 1,899,056 115
104,600 Enron Corporation 4,314,750 260
107,200 Illinova Corporation 3,008,300 182
62,200 MDU Resources Group, Inc. 1,399,500 84
89,500 MidAmerican Energy Holdings Company 2,640,250 159
40,800 Midcoast Energy Resources, Inc. 805,800 49
67,500 Montana Power Company 2,054,531 124
31,800 N U I Corporation 787,050 48
29,300 National Fuel Gas Company 1,382,594 83
66,300 New Century Energies, Inc. 2,216,906 134
29,900 New Jersey Resources Corporation 1,196,000 72
152,400 *Niagara Mohawk Holdings, Inc. 2,352,675 142
34,500 NICOR, Inc. 1,282,969 77
44,223 NSTAR 1,713,641 103
127,400 OGE Energy Corporation 2,834,650 171
91,800 PacifiCorp 1,847,475 112
42,600 Peoples Energy Corporation 1,498,988 90
65,000 Pinnacle West Capital Corporation 2,364,375 143
81,800 Potomac Electric Power Company 2,080,788 126
35,700 Providence Energy Corporation 990,675 60
112,800 Public Service Company of New Mexico 2,058,600 124
34,400 RGS Energy Group, Inc. 842,800 51
108,400 SCANA Corporation 2,621,925 158
117,833 Sempra Energy 2,452,399 148
59,760 Sierra Pacific Resources 1,329,660 80
66,500 Texas Utilities Company 2,481,281 150
99,800 UtiliCorp United, Inc. 2,102,038 127
48,500 Washington Gas Light Company 1,315,563 79
96,400 Western Resources, Inc. 2,060,550 124
114,100 Williams Companies, Inc. 4,271,619 258
- --------------------------------------------------------------------------------------
80,963,992 4,887
- --------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $120,534,379) 147,365,475 8,894
- --------------------------------------------------------------------------------------
</TABLE>
31
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS UTILITIES INCOME FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
SHARES $10,000
OR OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
PREFERRED STOCKS--1.1%
COMMUNICATION SERVICES--.8%
17,300 Telecomunicacoes Brasileiras SA (ADR) $ 1,296,419 $ 78
- --------------------------------------------------------------------------------------
FINANCIAL--.3%
10,000 Pacific Telesis Financing I, 7.56% 234,375 14
10,000 Pacific Telesis Financing II, 8.50% 251,250 15
- --------------------------------------------------------------------------------------
485,625 29
- --------------------------------------------------------------------------------------
TOTAL VALUE OF PREFERRED STOCKS (cost $1,884,665) 1,782,044 107
- --------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--1.2%
UTILITIES
109,200 Avista Corporation, $1.24, 11/1/2001
(cost $2,071,459) 1,911,000 115
- --------------------------------------------------------------------------------------
CORPORATE BONDS--4.6%
COMMUNICATION SERVICES--3.1%
$ 500M AT&T Corp., 7.50%, 2006 511,966 31
500M BellSouth Telecommunications, Inc., 6.375%, 2004 495,757 30
2,000M Intermedia Communications, Inc., 9.50%, 2009 1,810,000 109
2,000M McLeodUSA, Inc., 8.125%, 2009 1,870,000 113
500M United Telephone Company of Florida, 6.25%, 2003 493,714 30
- --------------------------------------------------------------------------------------
5,181,437 313
- --------------------------------------------------------------------------------------
UTILITIES--1.5%
500M Baltimore Gas and Electric Co., 7.52%, 2000 504,450 30
500M Consolidated Edison, Inc., 6.625%, 2002 502,032 30
500M Duke Energy Corp., 5.875%, 2003 492,141 30
500M Idaho Power Co., 6.40%, 2003 496,143 30
500M Union Electric Co., 6.75%, 2008 497,363 30
- --------------------------------------------------------------------------------------
2,492,129 150
- --------------------------------------------------------------------------------------
TOTAL VALUE OF CORPORATE BONDS (cost $7,826,022) 7,673,566 463
- --------------------------------------------------------------------------------------
</TABLE>
32
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
SHORT-TERM CORPORATE NOTES--3.6%
$ 3,800M Metlife Funding, Inc., 5.32%, 10/6/99 $ 3,797,200 $ 229
2,250M Prudential Funding Corp., 5.27%, 10/13/99 2,246,045 136
- --------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $6,043,245) 6,043,245 365
- --------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $138,359,770) 99.4% 164,775,330 9,944
OTHER ASSETS, LESS LIABILITIES .6 920,272 56
- --------------------------------------------------------------------------------------
NET ASSETS 100.0% $165,695,602 $ 10,000
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
33
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Mid-Cap
Opportunity Fund for the fiscal year ending September 30, 1999. During the
period, the Fund's return on a net asset value basis was 44.7% for Class A
shares and 43.6% for Class B shares, compared to a return of 32.9% for the
Lipper mid-cap funds group.
The primary factors driving the Fund's performance were stock selection, sector
allocations and the generally solid performance of medium capitalization stocks.
The Fund's positive performance was aided by its holdings in a number of
sectors. In particular, the technology sector contributed the most to the Fund's
outperformance. Buoyed by the increase in Web traffic as well as in business-to-
business and consumer e-commerce, several of the Fund's technology holdings,
such as Exodus Communications, Verio and Go2Net posted strong returns. Several
semiconductor equipment manufacturers also benefited, including PRI Automation
and KLA Tencor. To benefit more fully from this environment, the Fund shifted
its Internet focus from content providers to infrastructure developers over the
course of the reporting period.
In a related sector, the Internet boom helped boost the returns of a number of
holdings in the communication industry, such as Orckit Communications. The
increased use of the Internet is driving demand for greater bandwidth for both
commercial and residential users. This growing need is being filled by
competitive local carrier exchanges, such as ICG Communications and GST Telecom.
Rising oil prices throughout the reporting period had a positive impact on the
Fund's energy holdings. Apache, an independent energy company, and Newfield
Exploration, whose properties are located principally in the Gulf of Mexico,
performed well.
A number of the Fund's holdings did not enhance performance. The health care
sector was particularly disappointing during the reporting period. This was due
to a number of macro-issues, such as the effects of the Balanced Budget Act of
1997. This legislation changed the policies and procedures regarding Medicare
reimbursements, and its effects were felt by hospitals, nursing homes and other
health care facilities. A number of the Fund's holdings in this sector
underperformed, such as Health Management Associates and HealthSouth, despite
the fact that historically, these have been well-managed health care service
providers.
The financial services sector also suffered through negative investor
psychology. This was brought on by the rising interest rate environment,
concerns about
34
<PAGE>
merger integration, potential Year 2000 computer glitches, exposure to Latin
America and declining revenues in the capital markets. In this negative
environment, some of the Fund's holdings underperformed.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Patricia D. Poitra
Patricia D. Poitra
Director of Equities
and Portfolio Manager
October 29, 1999
35
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
Comparison of change in value of $10,000 investment in the First Investors Mid-
Cap Opportunity Fund (Class A shares) and the Standard & Poor's 400 Midcap
Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 MID-CAP OPPORTUNITY FUND STANDARD & POOR'S 400 MIDCAP
<S> <C> <C> <C>
Aug-92 9,375 10,000
Oct-92 9,441 10,462
Oct-93 9,840 12,460
Oct-94 9,639 12,756
Oct-95 12,009 15,464
Oct-96 13,407 18,148
Oct-97 17,039 24,074
Sep-98 14,242 23,577
Sep-99 20,603 29,586
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 44.67% 35.61%
Five Years 16.87% 15.37%
Since Inception (8/24/92) 11.73% 10.71%
Class B Shares
One Year 43.61% 39.61%
Since Inception (1/12/95) 15.99% 15.74%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS MID-CAP
OPPORTUNITY FUND (CLASS A SHARES) BEGINNING 8/24/92 (INCEPTION DATE) WITH A
THEORETICAL INVESTMENT IN THE STANDARD & POOR'S 400 MIDCAP INDEX. THE STANDARD
& POOR'S 400 MIDCAP INDEX IS AN UNMANAGED CAPITALIZATION-WEIGHTED INDEX OF 400
STOCKS DESIGNED TO MEASURE PERFORMANCE OF THE MID-RANGE SECTOR OF THE U.S.
STOCK MARKET WHERE THE MEDIAN MARKET CAPITALIZATION IS APPROXIMATELY $700
MILLION. IT IS NOT POSSIBLE TO INVEST DIRECTLY IN THIS INDEX. IN ADDITION, THE
INDEX DOES NOT TAKE INTO ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE GRAPH
AND THE ACCOMPANYING TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN ASSUMED
THAT THE MAXIMUM SALES CHARGE WAS DEDUCTED FROM THE INITIAL $10,000 INVESTMENT
IN THE FUND AND ALL DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED. CLASS B
SHARES PERFORMANCE MAY BE GREATER THAN OR LESS THAN THAT SHOWN IN THE LINE
GRAPH ABOVE FOR CLASS A SHARES BASED ON DIFFERENCES IN SALES LOADS AND FEES
PAID BY SHAREHOLDERS INVESTING IN THE DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25%. THE CLASS B "S.E.C.
STANDARDIZED" RETURNS ARE ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE
(MAXIMUM OF 4% IN THE FIRST YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND
WERE WAIVED OR ASSUMED. IF SUCH EXPENSES HAD BEEN PAID BY THE FUND, THE
CLASS A "S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN FOR ONE YEAR, FIVE
YEARS AND SINCE INCEPTION WOULD HAVE BEEN 35.38%, 14.60% AND 10.01%,
RESPECTIVELY. THE CLASS B "S.E.C. STANDARDIZED" AVERAGE ANNUAL TOTAL RETURN
FOR ONE YEAR AND SINCE INCEPTION WOULD HAVE BEEN 39.27% AND 18.96%,
RESPECTIVELY. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE
RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE
SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THE ORIGINAL COST. STANDARD & POOR'S 400 MIDCAP INDEX FIGURES FROM STANDARD &
POOR'S AND ALL OTHER FIGURES FROM FIRST INVESTORS MANAGEMENT COMPANY, INC.
36
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--88.3%
CAPITAL GOODS--6.9%
12,600 *CommScope, Inc. $ 409,500 $ 72
21,100 *Flextronics International, Ltd. 1,227,756 215
37,700 Reynolds and Reynolds Company - Class "A" 768,137 135
8,600 *Sanmina Corporation 665,425 117
25,100 Symbol Technologies, Inc. 843,987 148
- -------------------------------------------------------------------------------------
3,914,805 687
- -------------------------------------------------------------------------------------
COMMUNICATION SERVICES--5.5%
15,000 *Commonwealth Telephone Enterprises, Inc. 660,000 116
40,000 *ICG Communications, Inc. 622,500 109
9,400 *MCI WorldCom, Inc. 675,625 118
10,600 *VoiceStream Wireless Corporation 654,219 115
12,200 *Western Wireless Corporation - Class "A" 547,094 96
- -------------------------------------------------------------------------------------
3,159,438 554
- -------------------------------------------------------------------------------------
CONSUMER CYCLICALS--9.6%
12,500 *Best Buy Company, Inc. 775,781 136
9,300 *CheckFree Holdings Corporation 382,462 67
8,000 *Costco Wholesale Corporation 576,000 101
95,300 *Finish Line, Inc. - Class "A" 833,875 146
58,500 Fred's, Inc. - Class "A" 720,281 126
15,700 *Insight Enterprises, Inc. 510,250 89
34,500 *Park Place Entertainment Corporation 431,250 76
17,400 *Payless ShoeSource, Inc. 878,700 154
17,500 *Royal Group Technologies, Ltd. 375,156 66
- -------------------------------------------------------------------------------------
5,483,755 961
- -------------------------------------------------------------------------------------
CONSUMER STAPLES--12.6%
24,900 *AT&T Corp. - Liberty Media Group - Class "A" 924,412 162
12,900 *Beringer Wine Estates Holdings, Inc. - Class "B" 529,706 93
35,000 *Cinar Corporation - Class "B" 1,058,750 186
18,000 Comcast Corporation - Spec. Class "A" 717,750 126
29,300 Earthgrains Company 648,262 114
103,400 *Packaged Ice, Inc. 348,975 61
15,500 *ShopKo Stores, Inc. 449,500 79
26,100 *Suiza Foods Corporation 978,750 172
- -------------------------------------------------------------------------------------
</TABLE>
37
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES (continued)
10,000 Time Warner, Inc. $ 607,500 $ 106
28,400 *Whole Foods Market, Inc. 929,214 163
- -------------------------------------------------------------------------------------
7,192,819 1,262
- -------------------------------------------------------------------------------------
ENERGY--3.1%
22,400 Apache Corporation 967,400 170
21,100 *Cooper Cameron Corporation 796,525 140
- -------------------------------------------------------------------------------------
1,763,925 310
- -------------------------------------------------------------------------------------
FINANCIAL--7.1%
10,700 Capital One Financial Corporation 417,300 73
25,200 Charter One Financial, Inc. 582,750 102
41,800 *Golden State Bancorp, Inc. 749,787 131
22,700 Protective Life Corporation 658,300 115
12,600 SLM Holding Corporation 541,800 95
6,600 Wachovia Corporation 518,925 91
20,000 Westamerica Bancorporation 605,000 106
- -------------------------------------------------------------------------------------
4,073,862 713
- -------------------------------------------------------------------------------------
HEALTHCARE--8.0%
16,700 *Albany Molecular Research, Inc. 419,588 74
51,900 *Health Management Associates, Inc. - Class "A" 382,763 67
38,750 Jones Pharma, Inc. 1,277,541 224
13,600 *Manor Care, Inc. 233,750 41
15,600 Teva Pharmaceutical Industries, Ltd. (ADR) 784,875 138
19,000 *Trigon Healthcare, Inc. - Class "A" 548,625 96
102,000 *US Oncology, Inc. 924,375 162
- -------------------------------------------------------------------------------------
4,571,517 802
- -------------------------------------------------------------------------------------
TECHNOLOGY--31.8%
15,900 *Advanced Energy Industries, Inc. 490,913 86
57,500 *American Xtal Technology, Inc. 1,229,063 216
21,700 *Asyst Technologies, Inc. 716,100 126
26,000 *Cadence Design Systems, Inc. 344,500 60
8,900 *CDW Computer Centers, Inc. 434,988 76
14,000 *Cisco Systems, Inc. 959,875 168
10,000 *Comverse Technology, Inc. 943,125 165
23,700 *Cypress Semiconductor Corporation 509,550 89
19,000 *EarthWeb, Inc. 750,500 132
- -------------------------------------------------------------------------------------
</TABLE>
38
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
TECHNOLOGY (continued)
9,800 *Exodus Communications, Inc. $ 706,213 $ 124
26,200 *Galileo Technology, Ltd. 655,000 115
8,000 *Go2Net, Inc. 518,000 91
2,600 *Inktomi Corporation 312,081 55
17,100 *InterVu, Inc. 634,838 111
15,500 *Jabil Circuit, Inc. 767,250 135
10,000 *KLA - Tencor Corporation 650,000 114
25,000 *Orckit Communications, Ltd. 884,375 155
33,700 *Preview Travel, Inc. 547,625 96
22,700 *PRI Automation, Inc. 820,038 144
5,200 *SDL, Inc. 396,825 70
38,100 *Symantec Corporation 1,370,411 240
62,500 *Take-Two Interactive Software, Inc. 691,406 121
28,700 *USWeb Corporation 984,769 173
75,600 *ViewCast.com, Inc. 491,400 86
16,200 *WebTrends Corporation 721,913 127
22,000 *Zoran Corporation 596,750 105
- -------------------------------------------------------------------------------------
18,127,508 3,180
- -------------------------------------------------------------------------------------
UTILITIES--3.7%
17,800 Devon Energy Corporation 737,588 129
14,396 NSTAR 557,845 98
30,900 Potomac Electric Power Company 786,019 138
- -------------------------------------------------------------------------------------
2,081,452 365
- -------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $41,070,589) 50,369,081 8,834
- -------------------------------------------------------------------------------------
</TABLE>
39
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
SHORT-TERM CORPORATE NOTES--11.9%
$ 2,000M Du Pont (E.I.) de Nemours & Co., 5.30%, 10/25/99 $ 1,992,932 $ 349
1,300M Ford Motor Credit Co., 5.28%, 10/5/99 1,299,236 228
2,500M Ford Motor Credit Co., 5.29%, 10/27/99 2,490,456 437
1,000M Paccar Financial Corp., 5.29%, 10/6/99 999,264 175
- -------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $6,781,888) 6,781,888 1,189
- -------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $47,852,477) 100.2% 57,150,969 10,023
EXCESS OF LIABILITIES OVER OTHER ASSETS (.2) (132,017) (23)
- -------------------------------------------------------------------------------------
NET ASSETS 100.0% $57,018,952 $ 10,000
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
40
<PAGE>
PORTFOLIO MANAGERS' LETTER
FIRST INVESTORS SPECIAL SITUATIONS FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Special
Situations Fund for the fiscal year ending September 30, 1999. During the
period, the Fund's return on a net asset value basis was 31.2% for Class A
shares and 30.5% for Class B shares, compared to a return of 26.9% for the
Lipper small-cap funds group.
The primary factor that drove the Fund's performance during the period was the
re-invigoration of small-cap stocks. Small-cap stocks struggled at the beginning
of the fiscal year, however, they outperformed large-caps the last two quarters
in a row, due to improving earnings and expectations that the improvement would
continue.
The Fund's return was bolstered by sector allocations and stock selection. The
Fund benefited from its holdings in the telecommunication sector. Competitive
local exchange carriers and telecommunication equipment providers benefited from
increasing Internet usage, which is driving the demand for greater bandwidth for
both commercial and residential users. Allegiance Telecomm, Inc. and U.S. LEC
Corporation are competitive local exchange carriers. Orckit Communications Ltd.
is a telecommunication company whose equipment helps make high speed Internet
access possible. Exodus Communications, Inc. is a provider of Internet systems
and network management solutions. Comverse Technology, Inc. makes and markets
telecommunication systems and software.
Two electronic contract manufacturing companies, DII Group, Inc. and Flextronics
International, were aided by the trend to outsource manufacturing by original
equipment manufacturers.
Other contributors to the small-cap turnaround were RF Micro Devices, Inc. and
Alpha Industries, Inc. These two communication semiconductor companies benefited
from continued strong growth in wireless communications, particularly cellular
phones.
Among the Fund's underperformers were IMRglobal Corporation and Condor
Technology Services, two information technology consulting firms that were
negatively affected by Year 2000 information technology spending.
In the health care sector, Pediatrics Medical Group, a neonatology physician
practice management company, suffered from the negative impact of an
investigation into the company's billing practices. U.S. Oncology, Inc., an
oncology physician practice management company, felt the negative effects of
rising drug costs.
41
<PAGE>
PORTFOLIO MANAGERS' LETTER (continued)
FIRST INVESTORS SPECIAL SITUATIONS FUND
In the telecommunication area, Saville Systems PLC, a telecommunication billing
solution provider, suffered from a failure to deliver a new product to its
customers on time, as well as from customer consolidation issues.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ David A. Hanover
David A. Hanover
Co-Portfolio Manager
/s/ Patricia D. Poitra
Patricia D. Poitra
Director of Equities
and Co-Portfolio Manager
October 29, 1999
42
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS SPECIAL SITUATIONS FUND
Comparison of change in value of $10,000 investment in the First Investors
Special Situations Fund (Class A shares) and the Russell 2000 Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 SPECIAL SITUATIONS FUND RUSSELL 2000
<S> <C> <C> <C>
Sep-90 9,375 10,000
Dec-90 9,741 9,657
Dec-91 14,657 13,874
Dec-92 17,186 16,144
Dec-93 20,714 18,889
Dec-94 19,955 18,288
Dec-95 24,730 23,080
Dec-96 27,588 26,900
Dec-97 32,042 32,822
Sep-98 25,758 27,603
Sep-99 33,805 32,889
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 31.24% 23.03%
Five Years 10.46% 9.05%
Since Inception (9/18/90) 15.25% 14.43%
Class B Shares
One Year 30.45% 26.45%
Since Inception (1/12/95) 11.14% 10.85%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS SPECIAL
SITUATIONS FUND (CLASS A SHARES) BEGINNING 9/18/90 (INCEPTION DATE) WITH A
THEORETICAL INVESTMENT IN THE RUSSELL 2000 INDEX. THE RUSSELL 2000 INDEX
CONSISTS OF THE SMALLEST 2,000 COMPANIES IN THE RUSSELL 3000 INDEX (WHICH
REPRESENTS APPROXIMATELY 98% OF THE INVESTABLE U.S. EQUITY MARKET). THE
RUSSELL 2000 INDEX IS AN UNMANAGED INDEX GENERALLY CONSIDERED AS THE PREMIER
OF SMALL CAPITALIZATION STOCKS. IT IS NOT POSSIBLE TO INVEST DIRECTLY IN THIS
INDEX. IN ADDITION, THE INDEX DOES NOT TAKE INTO ACCOUNT FEES AND EXPENSES.
FOR PURPOSES OF THE GRAPH AND THE ACCOMPANYING TABLE, UNLESS OTHERWISE
INDICATED, IT HAS BEEN ASSUMED THAT THE MAXIMUM SALES CHARGE WAS DEDUCTED FROM
THE INITIAL $10,000 INVESTMENT IN THE FUND AND ALL DIVIDENDS AND DISTRIBUTIONS
WERE REINVESTED. CLASS B SHARES PERFORMANCE MAY BE GREATER THAN OR LESS THAN
THAT SHOWN IN THE LINE GRAPH ABOVE FOR CLASS A SHARES BASED ON DIFFERENCES IN
THE SALES LOADS AND FEES PAID BY SHAREHOLDERS INVESTING IN THE DIFFERENT
CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25% (PRIOR TO 7/1/93, THE
MAXIMUM SALES CHARGE WAS 6.9%). THE CLASS B "S.E.C. STANDARDIZED" RETURNS ARE
ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE (MAXIMUM OF 4% IN THE FIRST
YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND WERE WAIVED OR ASSUMED. IF SUCH
EXPENSES HAD BEEN PAID BY THE FUND, THE CLASS A "S.E.C. STANDARDIZED" AVERAGE
ANNUAL TOTAL RETURN FOR ONE YEAR, FIVE YEARS AND SINCE INCEPTION WOULD HAVE
BEEN 22.78%, 8.81% AND 13.98%, RESPECTIVELY. THE CLASS B "S.E.C. STANDARDIZED"
AVERAGE ANNUAL TOTAL RETURN FOR ONE YEAR AND SINCE INCEPTION WOULD HAVE BEEN
26.16% AND 10.48%, RESPECTIVELY. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT
INDICATE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL COST. RUSSELL 2000 INDEX FIGURES FROM
FRANK RUSSELL AND COMPANY AND ALL OTHER FIGURES FROM FIRST INVESTORS
MANAGEMENT COMPANY, INC.
43
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS SPECIAL SITUATIONS FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--93.0%
BASIC MATERIALS--2.0%
159,400 *ChirRex, Inc. $ 4,114,512 $ 200
- --------------------------------------------------------------------------------------
CAPITAL GOODS--3.3%
84,700 *CommScope, Inc. 2,752,750 134
70,200 *Flextronics International, Ltd. 4,084,762 199
- --------------------------------------------------------------------------------------
6,837,512 333
- --------------------------------------------------------------------------------------
COMMUNICATION SERVICES--8.1%
56,700 *Allegiance Telecom, Inc. 2,983,837 145
35,000 Applied Power, Inc. - Class "A" 1,063,125 52
56,500 *Commonwealth Telephone Enterprises, Inc. 2,486,000 121
187,500 *ICG Communications, Inc. 2,917,969 142
74,700 *ITC/DeltaCom, Inc. 2,054,250 100
117,000 *US LEC Corporation - Class "A" 2,881,125 140
43,200 *WinStar Communications, Inc. 1,687,500 82
27,600 *WorldGate Communications, Inc. 631,350 31
- --------------------------------------------------------------------------------------
16,705,156 813
- --------------------------------------------------------------------------------------
CONSUMER CYCLICALS--7.4%
67,200 *Fossil, Inc. 1,818,600 88
157,400 Fred's, Inc. - Class "A" 1,937,987 94
139,400 *Hibbett Sporting Goods, Inc. 2,282,675 111
70,300 *NCO Group, Inc. 3,304,100 161
49,600 *Travis Boats & Motors, Inc. 477,400 23
107,700 *Tuesday Morning Corporation 2,719,425 132
236,100 Wolverine World Wide, Inc. 2,685,637 131
- --------------------------------------------------------------------------------------
15,225,824 740
- --------------------------------------------------------------------------------------
CONSUMER STAPLES--16.3%
48,100 *Ames Department Stores, Inc. 1,533,187 75
77,000 *AT&T Corp. - Liberty Media Group - Class "A" 2,858,625 139
58,800 *Beringer Wine Estates Holdings, Inc. - Class "B" 2,414,475 117
204,200 *Cinar Corporation - Class "B" 6,177,050 300
83,600 *Citadel Communications Corporation 2,852,850 139
128,900 Earthgrains Company 2,851,912 139
299,200 *Four Media Company 1,570,800 76
63,300 *Jones Intercable, Inc. - Class "A" 3,422,156 166
117,800 *Suiza Foods Corporation 4,417,500 215
- --------------------------------------------------------------------------------------
</TABLE>
44
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
CONSUMER STAPLES (continued)
36,600 *THQ, Inc. $ 1,578,375 $ 77
116,100 *Whole Foods Market, Inc. 3,798,653 185
- --------------------------------------------------------------------------------------
33,475,583 1,628
- --------------------------------------------------------------------------------------
ENERGY--1.9%
120,300 *Newfield Exploration Company 3,962,381 193
- --------------------------------------------------------------------------------------
FINANCIAL--4.0%
101,100 Chittenden Corporation 2,881,350 140
166,800 HCC Insurance Holdings, Inc. 2,804,325 136
79,000 Westamerica Bancorporation 2,389,750 116
- --------------------------------------------------------------------------------------
8,075,425 392
- --------------------------------------------------------------------------------------
HEALTHCARE--20.2%
80,900 *Dura Pharmaceuticals, Inc. 1,127,544 55
144,400 Hooper Holmes, Inc. 3,700,250 180
152,100 *Impath, Inc. 4,429,912 215
203,400 Jones Pharma, Inc. 6,705,854 326
305,700 *Kensey Nash Corporation 4,776,562 232
78,000 *Medicis Pharmaceutical Corporation 2,223,000 108
98,300 *Molecular Devices Corporation 2,703,250 132
255,800 *Province Healthcare Company 2,941,700 143
209,900 *Sangstat Medical Corporation 4,486,613 218
43,100 Teva Pharmaceutical Industries, Ltd. (ADR) 2,168,469 105
87,800 *Trigon Healthcare, Inc. - Class "A" 2,535,225 123
413,242 *US Oncology, Inc. 3,745,006 182
- --------------------------------------------------------------------------------------
41,543,385 2,019
- --------------------------------------------------------------------------------------
TECHNOLOGY--29.8%
51,800 *Alpha Industries, Inc. 2,921,846 142
110,400 *Amdocs, Ltd. 2,318,400 113
36,800 *Comverse Technology, Inc. 3,470,700 169
55,400 *Cree Research, Inc. 1,880,138 91
103,600 *DII Group, Inc. 3,645,425 177
8,900 *EarthWeb, Inc. 351,550 17
63,900 *Etec Systems, Inc. 2,404,238 117
35,400 *Exodus Communications, Inc. 2,551,013 124
83,000 *Galileo Technology, Ltd. 2,075,000 101
20,600 *Go2Net, Inc. 1,333,850 65
- --------------------------------------------------------------------------------------
</TABLE>
45
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS SPECIAL SITUATIONS FUND
September 30, 1999
<TABLE>
- --------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
SHARES $10,000
OR OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- --------------------------------------------------------------------------------------
<C> <S> <C> <C>
TECHNOLOGY (continued)
11,100 *Inktomi Corporation $ 1,332,347 $ 65
62,000 *InterVu, Inc. 2,301,750 112
9,500 JDS Uniphase Corporation 1,081,219 53
37,400 *KLA - Tencor Corporation 2,431,000 118
148,300 *N I C E Systems, Ltd. (ADR) 3,818,725 186
180,300 *Orckit Communications, Ltd. 6,378,113 310
68,300 *PRI Automation, Inc. 2,467,338 120
59,600 *RF Micro Devices, Inc. 2,726,700 133
347,000 *Saga Systems, Inc. 5,009,813 244
22,700 *Sanchez Computer Associates, Inc. 797,338 39
108,300 *Symantec Corporation 3,895,421 189
55,900 *Synopsys, Inc. 3,139,137 153
176,500 *ViewCast.com, Inc. 1,147,250 56
39,600 *WebTrends Corporation 1,764,675 86
- --------------------------------------------------------------------------------------
61,242,986 2,980
- --------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $151,268,603) 191,182,764 9,298
- --------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--7.4%
$ 2,000M Ford Motor Credit Co., 5.28%, 10/5/99 1,998,824 97
3,200M Ford Motor Credit Co., 5.29%, 10/12/99 3,194,812 155
2,000M Halliburton Co., 5.29%, 10/26/99 1,992,645 97
2,300M Halliburton Co., 5.30%, 10/26/99 2,291,530 111
1,000M Heinz, H.J. Co., 5.30%, 10/12/99 998,375 49
1,000M Hewlett Packard Co., 5.27%, 10/12/99 998,384 49
1,300M Paccar Financial Corp., 5.29%, 10/13/99 1,297,702 63
1,200M Prudential Funding Corp., 5.30%, 11/13/99 1,194,169 58
1,200M Washington Gas Light Co., 5.30%, 10/21/99 1,196,461 58
- --------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $15,162,902) 15,162,902 737
- --------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $166,431,505) 100.4% 206,345,666 10,035
EXCESS OF LIABILITIES OVER OTHER ASSETS (.4) (716,846) (35)
- --------------------------------------------------------------------------------------
NET ASSETS 100.0% $205,628,820 $ 10,000
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
46
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS FOCUSED EQUITY FUND
Dear Investor:
We are pleased to present the annual report for the First Investors Focused
Equity Fund. The Focused Equity Fund was launched on March 22, 1999 and ended
its fiscal year on September 30, 1999. During the period, the Fund's return on a
net asset value basis was 8.8% for Class A shares and 8.4% for Class B shares,
compared to a return of 1.5% for the Lipper growth peer group.
The Fund's performance was driven by the overall market as well as its stock
selections. The Fund benefited from large gains in Tyco International Ltd.,
Nielsen Media Research and AT&T Corp./Liberty Media Group. The performance was
hindered by losses in MCI WorldCom, Time Warner, Inc., L-3 Communications, and
Coca-Cola Enterprises.
The portfolio's largest investment, Tyco International Ltd., also proved to be
the greatest contributor to the Fund's performance during this fiscal period
with an appreciation of nearly 37%. The company continued to make acquisitions
that complemented its core businesses and added to earnings. Tyco closed its
acquisition of Raychem and Central Sprinkler Corp. and announced the
acquisitions of General Surgical Innovations, AFC Cable Systems and Siemens
Electromechanical Components. The combination of Siemens' strength in the
telecommunications industry and Tyco's strength in the automotive industry
provides powerful opportunities to enhance the combined market shares.
Shares of Nielsen Media Research increased over 70% for the period after the
company agreed to be purchased by VNU, a Dutch publisher. The market originally
did not appreciate the value of its monopoly franchise in television audience
measurement. The development of an Internet measurement business attracted
investor interest and the value of the business was finally realized with the
sale of the company in August.
MCI WorldCom traded down on concerns about a dilutive acquisition and an
increase in competition in the consumer long distance market. We believe that
the subsequent acquisition of Sprint Group may be expensive but it is probably
in the best long-term interests of shareholders. We pared back the size of our
investment because of the increased risk with regard to the approval process.
However, we remain confident in the company's management and its strategy of
being the lowest cost telecommunications service provider.
As for Time Warner, Inc., several analysts lowered numbers in the company's
music division attributing the weakness to two factors: a decrease in
international music revenues (particularly Latin America) and lessened revenue
from its top-
47
<PAGE>
PORTFOLIO MANAGER'S LETTER (continued)
FIRST INVESTORS FOCUSED EQUITY FUND
selling CDs, due to revenue sharing with movie producers on motion picture
soundtracks.
The stock market declined late in the reporting period on concerns of increased
inflation from a stronger worldwide economy and increasing wage inflation from a
dearth of available labor. To the extent that competition remains fierce and
productivity continues to increase, we see these threats as marginal going
forward. Also, it seems that the strength in the economy is coming from areas
where technology and new products are driving demand and prices are deflating.
On the other hand, in the more traditional economy led by retail and
automobiles, economic strength is being driven by a confident consumer looking
for price discounts and incentives. The recovery in Asia and Europe is providing
strength to the manufacturing side of the economy. There are no indications of
bottlenecks developing or any real pricing power that would signal inflation
problems.
While October began badly, as markets continued to head downward and Tyco, our
largest position, declined substantially in value on criticism of the company's
accounting practices, we are generally pleased with the composition of our
portfolio. Currently, we note that there is a valuation disparity between the
companies with the largest capitalization and the vast number of others in which
one can invest. While not ignoring this, we also see evidence of potential value
investment opportunities in smaller capitalization companies.
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Colin G. Morris
Colin G. Morris
Portfolio Manager
October 29, 1999
48
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS FOCUSED EQUITY FUND
Comparison of change in value of $10,000 investment in the First Investors
Focused Equity Fund (Class A shares), Lipper Growth Index and the Standard &
Poor's 500 Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 FOCUSED EQUITY FUND LIPPER GROWTH S&P 500
<S> <C> <C> <C>
Mar-99 9,375 10,000 10,000
Sep-99 10,197 10,151 9,956
Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
Since Inception (3/22/99) 8.80% 1.97%
Class B Shares
Since Inception (3/22/99) 8.40% 4.40%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS FOCUSED EQUITY
FUND (CLASS A SHARES) BEGINNING 3/22/99 (INCEPTION DATE) WITH THEORETICAL
INVESTMENTS IN THE LIPPER GROWTH INDEX AND THE STANDARD & POOR'S 500 INDEX.
THE LIPPER GROWTH INDEX IS A NET VALUE WEIGHTED INDEX OF THE 30 LARGEST
COMPANY GROWTH FUNDS. IT IS CALCULATED WITH ADJUSTMENTS FOR INCOME DIVIDENDS
AND CAPITAL GAINS DISTRIBUTIONS AS OF EX-DIVIDEND DATES. THE STANDARD & POOR'S
500 INDEX IS AN UNMANAGED CAPITALIZATION-WEIGHTED INDEX OF 500 STOCKS DESIGNED
TO MEASURE PERFORMANCE OF THE BROAD DOMESTIC ECONOMY THROUGH CHANGES IN THE
AGGREGATE MARKET VALUE OF SUCH STOCKS, WHICH REPRESENT ALL MAJOR INDUSTRIES.
IT IS NOT POSSIBLE TO INVEST DIRECTLY IN THESE INDICES. IN ADDITION, THE
INDICES DO NOT TAKE INTO ACCOUNT FEES AND EXPENSES. FOR PURPOSES OF THE GRAPH
AND THE ACCOMPANYING TABLE, UNLESS OTHERWISE INDICATED, IT HAS BEEN ASSUMED
THAT THE MAXIMUM SALES CHARGE WAS DEDUCTED FROM THE INITIAL $10,000 INVESTMENT
IN THE FUND AND ALL DIVIDENDS AND DISTRIBUTIONS WERE REINVESTED. CLASS B
SHARES PERFORMANCE MAY BE GREATER THAN OR LESS THAN THAT SHOWN IN THE LINE
GRAPH ABOVE FOR CLASS A SHARES BASED ON DIFFERENCES IN SALES LOADS AND FEES
PAID BY SHAREHOLDERS INVESTING IN THE DIFFERENT CLASSES.
* TOTAL RETURN FIGURES (FOR THE PERIOD ENDED 9/30/99) INCLUDE THE REINVESTMENT
OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE CALCULATED
WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS SHOWN ARE
BASED ON THE MAXIMUM SALES CHARGE OF 6.25%. THE CLASS B "S.E.C. STANDARDIZED"
RETURNS ARE ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE (MAXIMUM OF 4%
IN THE FIRST YEAR). SOME OR ALL OF THE EXPENSES OF THE FUND WERE WAIVED OR
ASSUMED. IF SUCH EXPENSES HAD BEEN PAID BY THE FUND, THE CLASS A "S.E.C.
STANDARDIZED" TOTAL RETURN SINCE INCEPTION WOULD HAVE BEEN 1.82%. THE CLASS B
"S.E.C. STANDARDIZED" TOTAL RETURN SINCE INCEPTION WOULD HAVE BEEN 4.25%.
RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT
AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THE
ORIGINAL COST. LIPPER GROWTH INDEX FIGURES FROM LIPPER ANALYTICAL SERVICES,
INC., STANDARD & POOR'S 500 INDEX FIGURES FROM STANDARD & POOR'S AND ALL OTHER
FIGURES FROM FIRST INVESTORS MANAGEMENT COMPANY, INC.
49
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS FOCUSED EQUITY FUND
September 30, 1999
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--94.3%
CAPITAL GOODS--13.1%
10,000 General Dynamics Corporation $ 624,375 $ 85
87,000 Tyco International, Ltd. 8,982,750 1,225
- -------------------------------------------------------------------------------------
9,607,125 1,310
- -------------------------------------------------------------------------------------
COMMUNICATION SERVICES--18.6%
13,700 Bell Atlantic Corporation 922,181 126
59,300 *L-3 Communications Holdings, Inc. 2,238,575 305
100,500 *MCI WorldCom, Inc. 7,223,437 985
17,200 *Nextel Communications, Inc. - Class "A" 1,166,375 159
37,200 US West, Inc. 2,122,725 290
- -------------------------------------------------------------------------------------
13,673,293 1,865
- -------------------------------------------------------------------------------------
CONSUMER STAPLES--32.9%
237,300 *AT&T Corp. - Liberty Media Group - Class "A" 8,809,761 1,202
44,000 *CBS Corporation 2,035,000 278
19,400 *Clear Channel Communications, Inc. 1,549,575 211
105,100 Coca Cola Enterprises, Inc. 2,371,319 323
57,300 Comcast Corporation - Spec. Class "A" 2,284,838 312
48,800 *Infinity Broadcasting Corporation - Class "A" 1,430,450 195
45,700 *MediaOne Group, Inc. 3,121,881 426
30,800 Pepsi Bottling Group, Inc. 525,525 72
33,400 Time Warner, Inc. 2,029,050 277
- -------------------------------------------------------------------------------------
24,157,399 3,296
- -------------------------------------------------------------------------------------
FINANCIAL--12.0%
15,700 American Express Company 2,113,613 288
27,950 American International Group, Inc. 2,429,903 331
51,900 Citigroup, Inc. 2,283,600 312
4,300 M&T Bank Corporation 1,973,700 269
- -------------------------------------------------------------------------------------
8,800,816 1,200
- -------------------------------------------------------------------------------------
HEALTHCARE--5.1%
42,200 Baxter International, Inc. 2,542,550 347
41,400 Becton, Dickinson and Company 1,161,788 158
- -------------------------------------------------------------------------------------
3,704,338 505
- -------------------------------------------------------------------------------------
</TABLE>
50
<PAGE>
<TABLE>
- -------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
SHARES $10,000
OR OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- -------------------------------------------------------------------------------------
<C> <S> <C> <C>
TECHNOLOGY--12.6%
9,000 *America Online, Inc. $ 936,000 $ 128
20,000 Computer Associates International, Inc. 1,225,000 167
9,800 Honeywell, Inc. 1,090,863 149
9,000 International Business Machines Corporation 1,092,375 149
26,900 *Microsoft Corporation 2,436,131 332
12,300 *Sun Microsystems, Inc. 1,143,900 156
7,200 *Yahoo!, Inc. 1,293,300 176
- -------------------------------------------------------------------------------------
9,217,569 1,257
- -------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $66,681,035) 69,160,540 9,433
- -------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--5.5%
$ 350M American Express Credit Corp., 5.20%, 10/1/99 350,000 48
3,300M Associates Corporation of North America, 5.25%,
10/1/99 3,300,000 450
350M Household Financial Corp., 5.15%, 10/1/99 350,000 48
- -------------------------------------------------------------------------------------
TOTAL VALUE OF SHORT-TERM CORPORATE NOTES (cost $4,000,000) 4,000,000 546
- -------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $70,681,035) 99.8% 73,160,540 9,979
OTHER ASSETS, LESS LIABILITIES .2 152,948 21
- -------------------------------------------------------------------------------------
NET ASSETS 100.0% $73,313,488 $ 10,000
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
51
<PAGE>
PORTFOLIO MANAGER'S LETTER
FIRST INVESTORS GLOBAL FUND, INC.
Dear Investor:
We are pleased to present the annual report for the First Investors Global Fund
for the fiscal year ending September 30, 1999. The First Investors Global Fund
returned on a net asset value basis 29.6% on Class A shares and 28.8% on
Class B shares, compared to a return of 30.5% for the Lipper Global Average. The
Morgan Stanley (MSCI) All Country World Free Index returned 30.9% while the MSCI
World Index (which is composed of only developed markets) returned 29.9%. During
the period, the Fund declared dividends from net investment income of .3 cents
per share on Class A shares. The Fund also declared a capital gains distribution
of 7.8 cents per share on Class A and Class B shares.
These strong returns were fueled by investors' acceptance of better economic
conditions globally. The Fund's performance was aided by its country
allocations. As of September 30, 1999, the Fund had 45.2% of its assets invested
in these three countries--U.S., Canada and Japan--aiding its returns. In
particular, the Japanese market outpaced other international equity markets
during the fiscal year ending September 30, 1999, buoyed by rising consumer
confidence and improving economic growth. According to the MSCI, Japan was up
77.7% in U.S. dollar terms for the fiscal year. The yen's rise during this
period contributed significantly to the Japanese market's strong performance but
was not the sole cause, as the Japanese stock market was up 39% in local
currency terms. The North American markets were also up strongly, with the U.S.
up 26.1% as measured by the S&P 500, and Canada up 40.2% according to the MSCI
during the fiscal year.
Europe is a second major focus for the Fund, with 43.6% of assets committed to
the region. Returns in Europe were more mixed over the fiscal year. Finland was
up 89.8%, largely on the strength of Nokia, while other countries had more
normal returns. Within Europe--an overweighting in France (+30.4%) paid off,
while the U.K. (+16.7%) and Germany (+6.7%) lagged behind.
Going forward, we continue to manage the Fund with an emphasis on three
investment themes: (1) positioning the Fund to take advantage of faster global
economic growth; (2) focusing on the more industrialized economies of core
continental Europe rather than on the U.K. and peripheral Europe; and
(3) increasing exposure to Japan. Underlying each of these themes is our
expectation that economic growth will increase in the coming quarters and that
these increases are not fully reflected in current market expectations and stock
prices. From a regional perspective we are less inclined at this time to invest
in the U.S. than we were twelve months ago, and we are more optimistic about the
52
<PAGE>
outlook for Japan and Europe. Going forward, we will look for opportunities to
further increase our weighting in Japan as our confidence in the current
recovery increases. In addition, there is a relatively high correlation between
the U.S. and European markets, and given the Fund's high weightings in these
areas, we are more inclined to add to Japan. In emerging markets, we will seek
selective opportunities to add to the Fund's existing 3.5% position, as the
current liquidity-driven market shifts to a profits-driven market over the
coming quarters.
In the U.S., we are concerned about the narrow focus of the stock market. The
technology sector, which represents about 25% of the S&P 500, seems to be the
only group with a positive outlook, but valuations there seemed stretched.
Gradually over the last three months, almost every sector of the S&P 500 has
suffered some erosion and technology appears to be the last bastion of strength.
While we like the outlook for technology longer term, current conditions would
seem to dictate a cautious approach to the group. We continue to believe that
economic conditions are favorable in the U.S. overall. However, we expect that
as the Fed gradually raises interest rates it will restrain the U.S. stock
market's upside, as is typically the case. While values appear to be emerging in
many sectors, such as health care and finance, it may take some time for the
overall market to escape from the worries that have developed over the last few
months.
In Japan, the economy and financial markets are dramatically improved from a
year ago. We now expect Japanese gross domestic product to grow by 2.2% in 2000,
a substantial upward revision, as private consumption and private investment are
set to increase after a period of decline. The Japanese government's increase in
spending helped ignite the current recovery, however it created large fiscal
deficits, which we expect to be maintained for some time. On the corporate side,
restructuring efforts are spreading and finally appear to be resulting in real
change. These typically include some aspects of merit-based pay and advancement,
streamlining and realigning business priorities, meaningful reorganization and
headcount reduction, plans to resolve cross shareholdings and pension
underfundings, the inclusion of outside directors, and foreign alliances.
Although the net effect of these corporate activities may be somewhat of a drag
on economic growth in the short term, they are critical to ensure the
longer-term health of the economy. In the short term, their dampening effect on
the economy will be outweighed by the boost provided by the burgeoning economic
expansion and the expectation of an additional large fiscal package for next
year. Prime drivers of growth going forward will be: (1) the return of business
and consumer confidence, (2) expected stabilization and growth in investment,
and (3) a turn in the inventory cycle. Within the Japanese market, we have been
continuing our shift
53
<PAGE>
PORTFOLIO MANAGER'S LETTER (continued)
FIRST INVESTORS GLOBAL FUND, INC.
toward domestically-oriented companies that should benefit from the turn in the
economy and have reduced our holdings in more export-oriented companies.
It is now equally clear that the European growth cycle also has turned positive,
although the magnitude of the swing is less than that of Japan. We expect GDP to
grow 3.2% in 2000 after increasing 2.1% this year. The industrial side of the
economy should accelerate the most, coming off a low base, with Germany
benefiting in particular. Within the context of strengthening growth, we are as
well optimistic about the outlook for inflation in Europe as labor supply is
adequate, capacity utilization is moderate, and wage growth remains under
control. We expect that corporate profits will grow in the double digits next
year within this overall positive economic environment. In addition to this
strong cyclical story, the popularity of equity, ongoing public and private
restructuring efforts and the advent of the euro form the foundation for
continued positive performance from European equities, especially on the
continent.
In closing, we continue to orient the Fund to take advantage of what we believe
will be stronger than expected economic growth around the globe in the coming
months. In the U.S., economic conditions continue to be favorable, and values
are emerging in many sectors. We are especially attracted by the opportunities
in the more industrially-oriented economies of continental Europe, with an
emphasis on Germany. Elsewhere, from Japan to Australia to the emerging markets,
our focus has been on countries, sectors and companies that will benefit the
most from stronger global growth.
We believe the Fund is well positioned to capitalize on the opportunities
present in this environment. As always, it is important to remember that there
are currency risks as well as country-specific political and economic risks to
investing internationally. While there is a fair degree of diversification
across markets and companies with this Fund, diversification cannot totally
protect from falling stock prices. In addition, there are also concerns
regarding the level of Year 2000 preparedness around the world. The Fund has
taken this into consideration in its security selections. Investors should be
aware of these risks and recognize that successful investing generally requires
a long-term commitment to the markets.
54
<PAGE>
Thank you for placing your trust in First Investors. As always, we appreciate
the opportunity to serve your investment needs.
Sincerely,
/s/ Trond Skramstad
Trond Skramstad
Portfolio Manager
October 29, 1999
55
<PAGE>
CUMULATIVE PERFORMANCE INFORMATION
FIRST INVESTORS GLOBAL FUND, INC.
Comparison of change in value of $10,000 investment in the First Investors
Global Fund, Inc. (Class A shares) and the Morgan Stanley Capital International
("MSCI") All Country World Free Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1999 GLOBAL FUND MSCI ALL COUNTRY WORLD FREE
<S> <C> <C> <C>
Jan-90 9,375 10,000
Dec-90 8,227 8,352
Dec-91 9,613 10,015
Dec-92 9,153 9,591
Dec-93 11,256 11,978
Dec-94 10,831 12,580
Dec-95 12,761 15,028
Dec-96 14,603 17,006
Dec-97 15,768 19,556
Sep-98 15,571 19,690
Sep-99 20,164 25,775
Average Annual Total Returns*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 29.63% 21.56%
Five Years 12.53% 11.07%
Ten Years 8.70% 8.00%
Class B Shares
One Year 28.78% 24.78%
Since Inception (1/12/95) 13.62% 13.36%
</TABLE>
THE GRAPH COMPARES A $10,000 INVESTMENT IN THE FIRST INVESTORS GLOBAL
FUND, INC. (CLASS A SHARES) BEGINNING 1/1/90 WITH A THEORETICAL INVESTMENT IN
THE MSCI ALL COUNTRY WORLD FREE INDEX (THE "INDEX"). THE INDEX REPRESENTS BOTH
THE DEVELOPED AND THE EMERGING MARKETS. THE INDEX INCLUDES 47 MARKETS OF WHICH
EMERGING MARKETS REPRESENT APPROXIMATELY 4.75%. IT IS NOT POSSIBLE TO INVEST
DIRECTLY IN THIS INDEX. IN ADDITION, THE INDEX DOES NOT TAKE INTO ACCOUNT FEES
AND EXPENSES. FOR PURPOSES OF THE GRAPH AND THE ACCOMPANYING TABLE, UNLESS
OTHERWISE INDICATED, IT HAS BEEN ASSUMED THAT THE MAXIMUM SALES CHARGE WAS
DEDUCTED FROM THE INITIAL $10,000 INVESTMENT IN THE FUND AND ALL DIVIDENDS AND
DISTRIBUTIONS WERE REINVESTED. CLASS B SHARES PERFORMANCE MAY BE GREATER THAN
OR LESS THAN THAT SHOWN IN THE LINE GRAPH ABOVE FOR CLASS A SHARES BASED ON
DIFFERENCES IN SALES LOADS AND FEES PAID BY SHAREHOLDERS INVESTING IN THE
DIFFERENT CLASSES.
* AVERAGE ANNUAL TOTAL RETURN FIGURES (FOR THE YEAR ENDED 9/30/99) INCLUDE THE
REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. "N.A.V. ONLY" RETURNS ARE
CALCULATED WITHOUT SALES CHARGES. THE CLASS A "S.E.C. STANDARDIZED" RETURNS
SHOWN ARE BASED ON THE MAXIMUM SALES CHARGE OF 6.25% (PRIOR TO 7/1/93, THE
MAXIMUM SALES CHARGE WAS 6.9%). THE CLASS B "S.E.C. STANDARDIZED" RETURNS ARE
ADJUSTED FOR THE APPLICABLE DEFERRED SALES CHARGE (MAXIMUM OF 4% IN THE FIRST
YEAR). RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT
AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THE
ORIGINAL COST. MSCI ALL COUNTRY WORLD FREE INDEX FIGURES FROM MORGAN STANLEY &
CO., INC. AND ALL OTHER FIGURES FROM FIRST INVESTORS MANAGEMENT COMPANY, INC.
56
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 1999
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
COMMON STOCKS--95.4%
UNITED STATES--33.3%
50,500 Abbott Laboratories $ 1,855,875 $ 56
29,400 Alcoa, Inc. 1,824,637 55
36,600 Allied Signal, Inc. 2,193,712 66
14,750 American General Corporation 932,016 28
43,302 American International Group, Inc. 3,764,568 113
36,425 AT&T Corporation 1,584,488 47
26,400 Baxter International, Inc. 1,590,600 48
31,100 Chevron Corporation 2,760,125 83
59,200 *Cisco Systems, Inc. 4,058,900 121
83,362 Citigroup, Inc. 3,667,928 110
41,149 Conoco, Inc. 1,126,454 34
16,700 Corning, Inc. 1,144,994 34
30,000 CSX Corporation 1,271,250 38
49,150 CVS Corporation 2,005,934 60
19,551 Du Pont (E.I.) de Nemours & Company 1,190,167 36
43,300 Exxon Corporation 3,288,094 98
28,200 First Data Corporation 1,237,275 37
29,000 Franklin Resources, Inc. 891,750 27
37,700 Gannett Company, Inc. 2,608,369 78
29,600 General Electric Company 3,509,450 105
15,200 Guidant Corporation 815,100 24
19,825 Hartford Financial Services Group, Inc. 810,347 24
36,650 Hewlett-Packard Company 3,371,800 101
67,800 Home Depot, Inc. 4,652,775 139
44,880 Intel Corporation 3,335,145 100
31,400 International Business Machines Corporation 3,811,175 114
41,000 Johnson & Johnson 3,766,875 113
23,725 Kimberly Clark Corporation 1,245,563 37
27,600 Marsh & McLennan Companies, Inc. 1,890,600 57
73,200 McDonald's Corporation 3,147,600 94
45,712 *MCI WorldCom, Inc. 3,285,550 98
18,500 Merrill Lynch & Company, Inc. 1,242,969 37
60,600 *Microsoft Corporation 5,488,088 164
50,000 Pharmacia & Upjohn, Inc. 2,481,250 74
27,600 Philip Morris Companies, Inc. 943,575 28
21,000 Praxair, Inc. 966,000 29
30,180 Procter & Gamble Company 2,829,375 85
60,800 SBC Communications, Inc. 3,104,600 93
28,600 Schlumberger, Ltd. 1,782,138 53
- ----------------------------------------------------------------------------------------
</TABLE>
57
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 1999
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
UNITED STATES (continued)
42,700 Servicemaster Company $ 685,869 $ 21
142,237 Southwest Airlines Company 2,160,224 65
57,500 State Street Corporation 3,715,938 111
29,800 Texas Instruments, Inc. 2,451,050 73
104,000 Wal-Mart Stores, Inc. 4,946,500 148
84,900 Walt Disney Company 2,196,788 66
39,500 Warner-Lambert Company 2,621,813 78
18,800 Weyerhaeuser Company 1,083,350 32
- ----------------------------------------------------------------------------------------
111,338,643 3,332
- ----------------------------------------------------------------------------------------
FRANCE--10.3%
7,100 Accor SA 1,655,212 50
16,100 Air Liquide SA 2,554,829 76
3,474 Alcatel 478,755 14
32,100 Alstom 1,072,772 32
10,190 AXA-Uap 1,289,259 39
39,580 Banque Nationale de Paris 3,159,345 95
9,300 Carrefour Supermarche 1,488,646 45
7,990 Casino Guichard Perrachon 919,010 27
12,400 Compagnie de Saint Gobain 2,311,050 69
39,200 Michelin (CGDE) - Class "B" 1,850,271 55
8,200 Pinault-Printemps-Redoute SA 1,554,474 47
40,400 Sanofi-Synthelabo SA 1,721,040 51
20,195 Societe Generale 4,161,735 124
22,020 Societe Nationale Elf Aquitaine SA 3,846,013 115
17,680 Suez Lyonnaise des Eaux 2,862,038 86
18,277 Total Fina SA - Class "B" 2,296,871 69
17,490 Vivendi SA 1,228,441 37
- ----------------------------------------------------------------------------------------
34,449,761 1,031
- ----------------------------------------------------------------------------------------
JAPAN--10.3%
219,000 Dai Nippon Printing Company, Ltd. 4,070,640 122
278,000 Daiwa Bank, Ltd. 926,928 28
91,000 Eisai Company, Ltd. 2,307,692 69
20,000 Fujitsu, Ltd. 623,650 19
40,000 Hoya Corporation 2,419,461 72
559,000 *Kawasaki Steel Corporation 1,296,825 39
23,800 Matsumotokiyoshi Company, Ltd. 1,855,358 56
- ----------------------------------------------------------------------------------------
</TABLE>
58
<PAGE>
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
JAPAN (continued)
2,000 Matsushita Communication Industrial Company, Ltd. $ 42,547 $ 1
108,000 NGK Insulators, Ltd. 1,047,844 31
121,000 Nikko Securities Company, Ltd. 1,022,823 31
150 Nippon Telegraph & Telephone Corporation 1,845,590 55
204 NTT Mobile Communications Network, Inc. 4,023,669 120
57,000 Olympus Optical Company, Ltd. 770,921 23
43,000 Omron Corporation 850,146 25
3,000 *Secom Company, Ltd. 273,316 8
22,500 Sony Corporation 3,362,215 101
41,000 Takeda Chemical Industries, Ltd. 2,214,239 66
12,200 Takefuji Corporation 2,031,615 61
59,000 Toshiba Corporation 439,438 13
30,000 Toyo Seikan Kaisha, Ltd. 648,070 19
26,300 Uni - Charm Corporation 1,588,325 48
15,000 Yamanouchi Pharmaceutical Company, Ltd. 703,015 21
- ----------------------------------------------------------------------------------------
34,364,327 1,028
- ----------------------------------------------------------------------------------------
UNITED KINGDOM--9.2%
37,600 Abbey National PLC 667,535 20
18,300 Anglo American PLC 1,035,250 31
27,200 Astrazeneca PLC (ADR) 1,149,200 34
36,700 Barclays PLC 1,077,667 32
163,241 BP Amoco PLC 2,981,453 89
420,400 British Airways PLC 2,360,937 71
67,129 British Telecommunications PLC 1,016,551 30
102,600 Cadbury Schweppes PLC 712,639 21
95,408 Diageo PLC 974,976 29
37,000 Imperial Chemical Industries PLC 410,399 12
557,000 Invensys PLC 2,715,277 81
67,100 National Westminster Bank PLC 1,564,779 47
83,900 Peninsular & Oriental Steam Navigation Company 1,265,682 38
105,500 Prudential Corporation PLC 1,621,068 48
161,200 Scottish Power PLC 1,481,380 44
642,900 Smith & Nephew PLC 2,024,940 61
265,937 Smithkline Beecham PLC 3,059,232 92
108,516 Standard Chartered PLC 1,569,118 47
135,507 Vodafone Airtouch PLC 3,209,134 96
- ----------------------------------------------------------------------------------------
30,897,217 923
- ----------------------------------------------------------------------------------------
</TABLE>
59
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 1999
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
GERMANY--7.3%
8,500 Allianz AG $ 2,449,607 $ 73
36,250 Bayer AG 1,445,804 43
55,100 Bayerische Motoren Werke (BMW) AG 1,555,060 47
16,170 Daimler-Chrysler AG 1,114,202 33
37,500 Deutsche Bank AG 2,510,877 75
39,430 Hoechst AG 1,717,512 51
37,601 Linde AG 2,086,348 62
20,791 Mannesmann AG 3,321,362 99
8,500 Muenchener Rueckver AG 1,717,259 51
53,480 Siemens AG 4,416,953 132
37,200 Veba AG 2,038,346 61
- ----------------------------------------------------------------------------------------
24,373,330 727
- ----------------------------------------------------------------------------------------
NETHERLANDS--5.0%
25,700 Fortis (NL) NV 830,696 25
50,400 Heineken NV 2,506,669 75
15,369 ING Groep NV 834,767 25
40,418 Koninklijke Ahold NV 1,330,096 40
52,772 Koninklijke KPN NV 2,312,720 69
33,140 Koninklijke Philips Electronics NV 3,335,292 100
27,400 Royal Dutch Petroleum Company 1,590,365 48
57,346 Unilever NV-CVA 3,902,596 117
- ----------------------------------------------------------------------------------------
16,643,201 499
- ----------------------------------------------------------------------------------------
SWITZERLAND--4.2%
11,020 Credit Suisse Group - Reg. Shs. 2,019,526 60
1,240 Holderbank Financiere Glarus AG 1,610,529 48
1,546 Nestle AG 2,905,318 87
1,373 Novartis AG - Reg. Shs. 2,036,717 61
340 Roche Holdings AG - Genusscheine 3,934,493 118
4,520 Swisscom AG 1,409,676 42
- ----------------------------------------------------------------------------------------
13,916,259 416
- ----------------------------------------------------------------------------------------
SPAIN--2.5%
41,700 Banco Popular Espanol SA 2,880,021 86
67,600 Endesa SA 1,284,373 38
- ----------------------------------------------------------------------------------------
</TABLE>
60
<PAGE>
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
SPAIN (continued)
69,600 Endesa SA (ADR) $ 1,331,100 $ 40
57,210 Telefonica SA (ADR) 2,746,080 82
- ----------------------------------------------------------------------------------------
8,241,574 246
- ----------------------------------------------------------------------------------------
AUSTRALIA--2.0%
85,069 Australia & New Zealand Banking Group, Ltd. 569,039 17
230,407 Broken Hill Proprietary Company, Ltd. 2,653,918 79
1,006,012 M.I.M. Holdings, Ltd. 945,394 28
17,500 News Corporation, Ltd. (ADR) 497,656 15
1,808,038 Pasminco, Ltd. 2,005,874 60
- ----------------------------------------------------------------------------------------
6,671,881 199
- ----------------------------------------------------------------------------------------
FINLAND--1.9%
48,000 Nokia OYJ - Class "A" 4,299,192 129
55,000 Upm - Kymmene Corporation 1,874,400 56
- ----------------------------------------------------------------------------------------
6,173,592 185
- ----------------------------------------------------------------------------------------
HONG KONG--1.6%
358,000 Cheung Kong Holdings, Ltd. 2,984,178 89
408,800 *China Telecom, Ltd. 1,260,429 38
571,000 New World Development Company, Ltd. 1,253,321 37
- ----------------------------------------------------------------------------------------
5,497,928 164
- ----------------------------------------------------------------------------------------
ITALY--1.6%
265,600 ENI SpA 1,666,069 50
186,200 Mediaset SpA 1,901,726 57
214,522 Telecom Italia SpA 1,864,282 56
- ----------------------------------------------------------------------------------------
5,432,077 163
- ----------------------------------------------------------------------------------------
CANADA--1.6%
91,600 Alcan Aluminum, Ltd. 2,864,253 86
78,000 Canadian National Railway Company 2,364,375 71
- ----------------------------------------------------------------------------------------
5,228,628 157
- ----------------------------------------------------------------------------------------
</TABLE>
61
<PAGE>
PORTFOLIO OF INVESTMENTS (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 1999
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
FOR EACH
$10,000
OF
NET
SHARES SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
SWEDEN--1.0%
29,600 Hennes & Mauritz AB - Class "B" $ 745,596 $ 22
222,030 Nordbanken Holdings AB 1,245,838 37
42,210 Telefonaktiebolaget L.M. Ericsson - Class "B" 1,307,799 39
- ----------------------------------------------------------------------------------------
3,299,233 98
- ----------------------------------------------------------------------------------------
BERMUDA--.8%
24,925 Tyco International, Ltd. 2,573,506 77
- ----------------------------------------------------------------------------------------
MEXICO--.6%
17,800 *Grupo Televisa SA (GDR) 710,887 21
38,000 Panamerican Beverages, Inc. (ADR) - Class "A" 629,375 19
11,300 Telefonica de Mexico SA 805,125 24
- ----------------------------------------------------------------------------------------
2,145,387 64
- ----------------------------------------------------------------------------------------
IRELAND--.6%
173,450 Allied Irish Banks PLC 2,096,620 63
- ----------------------------------------------------------------------------------------
SINGAPORE--.5%
139,000 Overseas Chinese Banking Corporation, Ltd. 1,078,977 32
156,454 Overseas Union Bank, Ltd. 694,636 21
- ----------------------------------------------------------------------------------------
1,773,613 53
- ----------------------------------------------------------------------------------------
BRAZIL--.4%
84,300 Embratel Participacoes SA (ADR) 964,181 29
10,500 *Telecomunicacoes Brasileiras SA (ADR) 329 --
29,200 Telesp Participacoes SA (ADR) 459,900 14
- ----------------------------------------------------------------------------------------
1,424,410 43
- ----------------------------------------------------------------------------------------
INDIA--.4%
19,900 Hindalco Industries, Ltd. (GDR) 543,767 16
16,400 Larsen & Toubro, Ltd. (GDR) 360,800 11
27,500 State Bank of India (GDR) 275,038 8
- ----------------------------------------------------------------------------------------
1,179,605 35
- ----------------------------------------------------------------------------------------
NEW ZEALAND--.3%
35,000 Telecom Corporation of New Zealand, Ltd. (ADR) 1,120,000 34
- ----------------------------------------------------------------------------------------
TOTAL VALUE OF COMMON STOCKS (cost $246,765,397) 318,840,792 9,537
- ----------------------------------------------------------------------------------------
</TABLE>
62
<PAGE>
<TABLE>
- ----------------------------------------------------------------------------------------
AMOUNT
INVESTED
SHARES, FOR EACH
WARRANTS $10,000
OR OF
PRINCIPAL NET
AMOUNT SECURITY VALUE ASSETS
- ----------------------------------------------------------------------------------------
<C> <S> <C> <C>
PREFERRED STOCKS--.9%
BRAZIL
673,000 Compania Cervejaria Brahma $ 404,855 $ 12
5,436,600 Petroleo Brasileiro SA - Petrobras 838,142 25
24,000 Telecomunicacoes Brasileiras SA (ADR) 1,798,500 54
23,000 *Vale Do Rio Doce - Class "B" -- --
- ----------------------------------------------------------------------------------------
TOTAL VALUE OF PREFERRED STOCKS (cost $2,892,231) 3,041,497 91
- ----------------------------------------------------------------------------------------
WARRANTS--.0%
THAILAND
5,800 *Siam Commercial Bank (expiring 12/31/02)
(cost $0) 1,453 --
- ----------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--4.9%
$16,531M Paine Webber, Inc., 5.28%, 10/1/99
(collateralized by U.S. Treasury Bonds, due
11/15/22, valued at $16,882,665) (cost
$16,531,000) 16,531,000 495
- ----------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL VALUE OF INVESTMENTS (cost $266,188,628) 101.2% 338,414,742 10,123
EXCESS OF LIABILITIES OVER OTHER ASSETS (1.2) (4,108,216) (123)
- ----------------------------------------------------------------------------------------
NET ASSETS 100.0% $334,306,526 $ 10,000
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
</TABLE>
* Non-income producing
See notes to financial statements
63
<PAGE>
PORTFOLIO OF INVESTMENTS
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 1999
Sector diversification of the portfolio was as follows:
<TABLE>
- --------------------------------------------------------------------
PERCENTAGE
SECTOR OF NET ASSETS VALUE
- --------------------------------------------------------------------
<S> <C> <C>
Banks.................................. 10.1% $ 33,882,998
Drugs.................................. 8.7 29,158,882
Telephone.............................. 7.3 24,317,572
Media.................................. 7.1 23,800,660
Energy Sources......................... 6.1 20,393,586
Retail................................. 5.8 19,498,389
Metals & Minerals...................... 5.1 17,091,497
Insurance.............................. 4.8 16,140,187
Electrical Equipment................... 3.8 12,539,670
Communication Equipment................ 3.0 10,144,646
Electronics............................ 2.9 9,745,137
Household Products..................... 2.9 9,565,859
Medical Products....................... 2.8 9,476,897
Travel & Leisure....................... 2.8 9,323,973
Food/Beverage/Tobacco.................. 2.7 9,077,407
Computers & Office Equipment........... 2.3 7,622,413
Machinery & Manufacturing.............. 2.3 7,525,690
Software Services...................... 2.0 6,725,363
Electric Utilities..................... 1.8 6,135,199
Financial Services..................... 1.6 5,189,157
Chemicals.............................. 1.5 5,121,395
Transportation......................... 1.5 4,901,307
Automotive............................. 1.4 4,519,533
Pipeline............................... 1.2 4,090,479
Business Services...................... 1.1 3,618,294
Entertainment Products................. 1.0 3,404,762
Paper/Forest Products.................. .9 2,957,750
Aerospace/Defense...................... .7 2,193,712
Energy Services........................ .5 1,782,138
Real Estate Companies.................. .4 1,253,321
Health Services........................ .2 685,869
Repurchase Agreement................... 4.9 16,531,000
- --------------------------------------------------------------------
TOTAL VALUE OF INVESTMENTS 101.2 338,414,742
EXCESS OF LIABILITIES OVER OTHER ASSETS (1.2) (4,108,216)
- --------------------------------------------------------------------
NET ASSETS 100.0% $334,306,526
- --------------------------------------------------------------------
- --------------------------------------------------------------------
</TABLE>
See notes to financial statements
64
<PAGE>
(This page has been left blank intentionally.)
65
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
FIRST INVESTORS
September 30, 1999
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
TOTAL GROWTH &
RETURN INCOME BLUE CHIP
- ---------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments in securities:
At identified cost................... $ 93,577,228 $360,349,806 $397,255,922
============ ============ ============
At value (Note 1A)................... $104,870,373 $457,938,509 $552,374,097
Cash................................... 996,020 4,057,034 802,301
Receivables:
Dividends and interest............... 501,168 446,937 263,935
Shares sold.......................... 238,023 1,122,941 916,826
Investment securities sold........... -- -- 235,477
Other assets........................... -- -- --
------------ ------------ ------------
Total Assets........................... 106,605,584 463,565,421 554,592,636
------------ ------------ ------------
LIABILITIES
Payables:
Investment securities purchased...... 4,854,711 7,512,447 12,190,385
Shares redeemed...................... 91,369 634,055 777,018
Forward currency contracts
(Note 4)........................... -- -- --
Accrued advisory fees.................. 63,219 280,809 340,981
Accrued expenses....................... 39,007 129,671 125,302
------------ ------------ ------------
Total Liabilities...................... 5,048,306 8,556,982 13,433,686
------------ ------------ ------------
NET ASSETS............................. $101,557,278 $455,008,439 $541,158,950
============ ============ ============
NET ASSETS CONSIST OF:
Capital paid in........................ $ 87,164,604 $315,041,836 $352,929,594
Undistributed net investment income.... 681,869 211,186 --
Accumulated net realized gain on
investments.......................... 2,417,660 42,166,714 33,111,181
Net unrealized appreciation in value of
investments.......................... 11,293,145 97,588,703 155,118,175
------------ ------------ ------------
Total.................................. $101,557,278 $455,008,439 $541,158,950
============ ============ ============
NET ASSETS:
Class A.............................. $ 92,068,829 $377,903,821 $471,447,131
Class B.............................. $ 9,488,449 $ 77,104,618 $ 69,711,819
SHARES OUTSTANDING (Note 5):
Class A.............................. 6,420,662 24,889,834 17,361,954
Class B.............................. 669,825 5,174,368 2,619,849
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE - CLASS A.................. $ 14.34 $ 15.18 $ 27.15
============ ============ ============
MAXIMUM OFFERING PRICE PER
SHARE - CLASS A
(Net asset value/.9375)*............. $ 15.30 $ 16.19 $ 28.96
============ ============ ============
NET ASSET VALUE AND OFFERING PRICE PER
SHARE -
CLASS B (Note 5)..................... $ 14.17 $ 14.90 $ 26.61
============ ============ ============
</TABLE>
* On purchases of $25,000 or more, the sales charge is reduced.
See notes to financial statements.
See notes to financial statements
66
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
UTILITIES MID-CAP SPECIAL FOCUSED
INCOME OPPORTUNITY SITUATIONS EQUITY GLOBAL
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments in securities:
At identified cost................... $138,359,770 $47,852,477 $ 166,431,505 $70,681,035 $266,188,628
============ =========== ============= =========== ============
At value (Note 1A)................... $164,775,330 $57,150,969 $ 206,345,666 $73,160,540 $338,414,742
Cash................................... 715,386 245,589 451,402 383,361 13,181
Receivables:
Dividends and interest............... 529,587 3,138 20,540 16,769 755,134
Shares sold.......................... 269,708 270,643 187,952 573,948 240,996
Investment securities sold........... 178,744 2,299,951 1,596,769 -- 943,065
Other assets........................... -- -- -- -- 20,335
------------ ----------- ------------- ----------- ------------
Total Assets........................... 166,468,755 59,970,290 208,602,329 74,134,618 340,387,453
------------ ----------- ------------- ----------- ------------
LIABILITIES
Payables:
Investment securities purchased...... 306,556 2,785,891 2,381,439 677,141 5,298,239
Shares redeemed...................... 307,079 92,750 371,417 53,008 346,875
Forward currency contracts
(Note 4)........................... -- -- -- -- 9,418
Accrued advisory fees.................. 102,225 35,153 129,290 43,963 276,777
Accrued expenses....................... 57,293 37,544 91,363 47,018 149,618
------------ ----------- ------------- ----------- ------------
Total Liabilities...................... 773,153 2,951,338 2,973,509 821,130 6,080,927
------------ ----------- ------------- ----------- ------------
NET ASSETS............................. $165,695,602 $57,018,952 $ 205,628,820 $73,313,488 $334,306,526
============ =========== ============= =========== ============
NET ASSETS CONSIST OF:
Capital paid in........................ $126,543,511 $43,252,357 $ 155,132,562 $70,827,389 $227,988,757
Undistributed net investment income.... 770,181 -- -- -- --
Accumulated net realized gain on
investments.......................... 11,966,350 4,468,103 10,582,097 6,594 34,074,639
Net unrealized appreciation in value of
investments.......................... 26,415,560 9,298,492 39,914,161 2,479,505 72,243,130
------------ ----------- ------------- ----------- ------------
Total.................................. $165,695,602 $57,018,952 $ 205,628,820 $73,313,488 $334,306,526
============ =========== ============= =========== ============
NET ASSETS:
Class A.............................. $145,005,159 $49,590,364 $ 185,924,716 $59,178,494 $316,454,759
Class B.............................. $ 20,690,443 $ 7,428,588 $ 19,704,104 $14,134,994 $ 17,851,767
SHARES OUTSTANDING (Note 5):
Class A.............................. 18,145,536 2,359,451 7,944,124 5,438,892 39,024,214
Class B.............................. 2,624,565 364,972 871,131 1,303,990 2,265,847
NET ASSET VALUE AND REDEMPTION PRICE
PER SHARE - CLASS A.................. $ 7.99 $ 21.02 $ 23.40 $ 10.88 $ 8.11
============ =========== ============= =========== ============
MAXIMUM OFFERING PRICE PER
SHARE - CLASS A
(Net asset value/.9375)*............. $ 8.52 $ 22.42 $ 24.96 $ 11.61 $ 8.65
============ =========== ============= =========== ============
NET ASSET VALUE AND OFFERING PRICE PER
SHARE -
CLASS B (Note 5)..................... $ 7.88 $ 20.35 $ 22.62 $ 10.84 $ 7.88
============ =========== ============= =========== ============
</TABLE>
* On purchases of $25,000 or more, the sales charge is reduced.
See notes to financial statements.
67
<PAGE>
STATEMENT OF OPERATIONS
FIRST INVESTORS
Year Ended September 30, 1999
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
TOTAL GROWTH &
RETURN INCOME BLUE CHIP
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Dividends............................ $ 740,816 $ 5,210,095 $ 5,751,699
Interest............................. 2,496,085 1,510,518 1,124,528
---------- --------------- ------------
Total income........................... 3,236,901 6,720,613 6,876,227
---------- --------------- ------------
Expenses (Notes 1 and 3):
Advisory fees........................ 936,921 3,035,400 4,382,941
Distribution plan
expenses - Class A................. 260,211 1,032,302 1,367,207
Distribution plan
expenses - Class B................. 69,269 645,751 628,753
Shareholder servicing costs.......... 248,873 1,035,179 1,123,268
Professional fees.................... 22,682 71,358 73,682
Custodian fees and expenses.......... 24,567 52,563 48,069
Reports and notices to
shareholders....................... 12,107 60,085 68,540
Other expenses....................... 12,871 64,577 67,153
---------- --------------- ------------
Total expenses......................... 1,587,501 5,997,215 7,759,613
Less: Expenses waived or assumed....... (234,230) -- (501,256)
Custodian fees paid indirectly.... (15,380) (16,945) (16,443)
---------- --------------- ------------
Net expenses........................... 1,337,891 5,980,270 7,241,914
---------- --------------- ------------
Net investment income (loss)........... 1,899,010 740,343 (365,687)
---------- --------------- ------------
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS (Note 2):
Net realized gain on investments and
foreign currency transactions........ 2,423,160 42,168,688 33,613,424
Net unrealized appreciation of
investments and foreign currency
transactions......................... 4,417,389 28,436,909 69,988,521
---------- --------------- ------------
Net gain on investments and foreign
currency transactions................ 6,840,549 70,605,597 103,601,945
---------- --------------- ------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS...................... $8,739,559 $ 71,345,940 $103,236,258
========== =============== ============
</TABLE>
* From March 22, 1999 (commencement of operations) to September 30, 1999.
+ Net of $396,902 foreign taxes withheld.
See notes to financial statements
68
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
UTILITIES MID-CAP SPECIAL FOCUSED
INCOME OPPORTUNITY SITUATIONS EQUITY* GLOBAL
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends............................ $ 4,191,657 $ 252,992 $ 564,308 $ 84,671 $ 4,774,371+
Interest............................. 603,125 128,442 565,020 138,058 697,854
----------- ----------- ------------- ---------- -----------
Total income........................... 4,794,782 381,434 1,129,328 222,729 5,472,225
----------- ----------- ------------- ---------- -----------
Expenses (Notes 1 and 3):
Advisory fees........................ 1,181,599 485,758 2,029,150 208,003 3,222,946
Distribution plan
expenses - Class A................. 418,222 127,413 556,888 67,591 926,324
Distribution plan
expenses - Class B................. 183,929 60,731 189,233 50,019 156,867
Shareholder servicing costs.......... 386,227 164,149 808,473 189,206 920,534
Professional fees.................... 46,459 20,701 41,789 21,226 60,314
Custodian fees and expenses.......... 26,431 14,605 39,607 6,242 309,843
Reports and notices to
shareholders....................... 17,718 11,426 51,841 15,536 51,919
Other expenses....................... 28,347 14,328 32,933 5,609 39,376
----------- ----------- ------------- ---------- -----------
Total expenses......................... 2,288,932 899,111 3,749,914 563,432 5,688,123
Less: Expenses waived or assumed....... -- (121,439) (494,988) (41,267) --
Custodian fees paid indirectly.... (20,725) (10,579) (16,892) (6,242) --
----------- ----------- ------------- ---------- -----------
Net expenses........................... 2,268,207 767,093 3,238,034 515,923 5,688,123
----------- ----------- ------------- ---------- -----------
Net investment income (loss)........... 2,526,575 (385,659) (2,108,706) (293,194) (215,898)
----------- ----------- ------------- ---------- -----------
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS (Note 2):
Net realized gain on investments and
foreign currency transactions........ 12,567,447 8,318,436 15,641,687 6,594 34,466,572
Net unrealized appreciation of
investments and foreign currency
transactions......................... 1,441,561 7,655,565 39,320,820 2,479,505 45,266,566
----------- ----------- ------------- ---------- -----------
Net gain on investments and foreign
currency transactions................ 14,009,008 15,974,001 54,962,507 2,486,099 79,733,138
----------- ----------- ------------- ---------- -----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS...................... $16,535,583 $15,588,342 $ 52,853,801 $2,192,905 $79,517,240
=========== =========== ============= ========== ===========
</TABLE>
* From March 22, 1999 (commencement of operations) to September 30, 1999.
+ Net of $396,902 foreign taxes withheld.
See notes to financial statements
69
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
FIRST INVESTORS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
TOTAL RETURN
--------------------------------------
10/1/98 TO 1/1/98 TO 1/1/97 TO
9/30/99 9/30/98 12/31/97
- --------------------------------------- ------------ ----------- -----------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)......... $ 1,899,010 $ 1,191,123 $ 1,214,000
Net realized gain on investments..... 2,423,160 6,468,239 5,053,532
Net unrealized appreciation
(depreciation) of investments...... 4,417,389 (4,386,811) 3,974,842
------------ ----------- -----------
Net increase (decrease) in net
assets resulting from
operations....................... 8,739,559 3,272,551 10,242,374
------------ ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A........ (1,713,302) (642,040) (1,227,991)
Net investment income-Class B........ (89,161) (18,789) (26,544)
Net realized gains-Class A........... (6,072,779) -- (4,841,852)
Net realized gains-Class B........... (367,813) -- (184,600)
------------ ----------- -----------
Total distributions................ (8,243,055) (660,829) (6,280,987)
------------ ----------- -----------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 22,168,315 10,008,749 9,720,765
Reinvestment of distributions...... 7,731,158 636,265 6,023,569
Cost of shares redeemed............ (11,023,441) (7,257,300) (9,501,874)
------------ ----------- -----------
18,876,032 3,387,714 6,242,460
------------ ----------- -----------
Class B:
Proceeds from shares sold.......... 5,749,808 1,905,526 1,430,563
Reinvestment of distributions...... 453,589 18,442 207,161
Cost of shares redeemed............ (778,629) (397,593) (169,088)
------------ ----------- -----------
5,424,768 1,526,375 1,468,636
------------ ----------- -----------
Net increase from share
transactions..................... 24,300,800 4,914,089 7,711,096
------------ ----------- -----------
Net increase in net assets....... 24,797,304 7,525,811 11,672,483
NET ASSETS
Beginning of period.................. 76,759,974 69,234,163 57,561,680
------------ ----------- -----------
End of period+....................... $101,557,278 $76,759,974 $69,234,163
============ =========== ===========
+Includes undistributed net
investment income of.................. $ 681,869 $ 585,322 $ 55,028
============ =========== ===========
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 1,525,660 692,647 683,584
Issued for distributions
reinvested....................... 562,168 42,650 437,106
Redeemed........................... (758,163) (500,175) (680,904)
------------ ----------- -----------
Net increase in Class A shares
outstanding...................... 1,329,665 235,122 439,786
============ =========== ===========
Class B:
Sold............................... 399,606 132,731 100,991
Issued for distributions
reinvested....................... 33,363 1,245 15,167
Redeemed........................... (54,229) (27,765) (12,388)
------------ ----------- -----------
Net increase in Class B shares
outstanding...................... 378,740 106,211 103,770
============ =========== ===========
</TABLE>
See notes to financial statements
70
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
GROWTH & INCOME BLUE CHIP
---------------------------------------- ----------------------------------------
10/1/98 TO 11/1/97 TO 11/1/96 TO 10/1/98 TO 1/1/98 TO 1/1/97 TO
9/30/99 9/30/98 10/31/97 9/30/99 9/30/98 12/31/97
- --------------------------------------- ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)........... $ 740,343 $ 975,590 $ 815,670 $ (365,687) $ 518,636 $ 1,132,054
Net realized gain on investments....... 42,168,688 60,194 5,328,547 33,613,424 12,979,954 26,645,071
Net unrealized appreciation
(depreciation) of investments........ 28,436,909 15,489,708 31,106,647 69,988,521 (22,977,214) 44,536,413
------------ ------------ ------------ ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations.......... 71,345,940 16,525,492 37,250,864 103,236,258 (9,478,624) 72,313,538
------------ ------------ ------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A.......... (992,115) (474,191) (817,347) (317,918) (476,685) (1,008,850)
Net investment income-Class B.......... (40,249) -- (14,650) -- -- --
Net realized gains-Class A............. (42,283) (4,666,252) (2,000,523) (12,371,853) -- (23,224,732)
Net realized gains-Class B............. (7,315) (666,704) (234,403) (1,609,894) -- (2,472,186)
------------ ------------ ------------ ------------ ------------ ------------
Total distributions.................. (1,081,962) (5,807,147) (3,066,923) (14,299,665) (476,685) (26,705,768)
------------ ------------ ------------ ------------ ------------ ------------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 102,341,947 78,231,913 69,592,366 72,173,097 63,584,545 83,933,830
Reinvestment of distributions...... 1,048,356 5,089,594 2,780,887 12,531,573 469,526 23,979,379
Cost of shares redeemed............ (43,412,409) (29,473,440) (20,987,333) (60,742,794) (38,294,869) (39,561,111)
------------ ------------ ------------ ------------ ------------ ------------
59,977,894 53,848,067 51,385,920 23,961,876 25,759,202 68,352,098
------------ ------------ ------------ ------------ ------------ ------------
Class B:
Proceeds from shares sold.......... 30,709,718 18,528,954 12,978,761 18,332,130 16,422,338 17,001,914
Reinvestment of distributions...... 15,077 662,444 246,352 1,601,695 -- 2,448,261
Cost of shares redeemed............ (6,576,464) (3,893,425) (2,077,855) (6,583,849) (5,068,439) (2,520,555)
------------ ------------ ------------ ------------ ------------ ------------
24,148,331 15,297,973 11,147,258 13,349,976 11,353,899 16,929,620
------------ ------------ ------------ ------------ ------------ ------------
Net increase from share
transactions...................... 84,126,225 69,146,040 62,533,178 37,311,852 37,113,101 85,281,718
------------ ------------ ------------ ------------ ------------ ------------
Net increase in net assets....... 154,390,203 79,864,385 96,717,119 126,248,445 27,157,792 130,889,488
NET ASSETS
Beginning of period.................. 300,618,236 220,753,851 124,036,732 414,910,505 387,752,713 256,863,225
------------ ------------ ------------ ------------ ------------ ------------
End of period+....................... $455,008,439 $300,618,236 $220,753,851 $541,158,950 $414,910,505 $387,752,713
============ ============ ============ ============ ============ ============
+Includes undistributed net
investment income of................. $ 211,186 $ 499,957 $ -- $ -- $ 200,729 $ 158,778
============ ============ ============ ============ ============ ============
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 6,803,906 6,064,102 6,493,708 2,714,307 2,600,224 3,767,172
Issued for distributions
reinvested........................ 74,965 419,923 283,146 536,723 18,220 1,051,211
Redeemed........................... (2,913,486) (2,288,057) (1,962,857) (2,292,893) (1,570,204) (1,783,673)
------------ ------------ ------------ ------------ ------------ ------------
Net increase in Class A shares
outstanding....................... 3,965,385 4,195,968 4,813,997 958,137 1,048,240 3,034,710
============ ============ ============ ============ ============ ============
Class B:
Sold............................... 2,074,035 1,449,761 1,213,405 701,312 674,423 764,680
Issued for distributions
reinvested........................ 1,096 55,714 25,769 69,604 -- 108,187
Redeemed........................... (446,609) (305,374) (195,408) (252,535) (209,618) (114,584)
------------ ------------ ------------ ------------ ------------ ------------
Net increase in Class B shares
outstanding....................... 1,628,522 1,200,101 1,043,766 518,381 464,805 758,283
============ ============ ============ ============ ============ ============
</TABLE>
See notes to financial statements
71
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (continued)
FIRST INVESTORS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
UTILITIES INCOME
----------------------------------------
10/1/98 TO 11/1/97 TO 11/1/96 TO
9/30/99 9/30/98 10/31/97
- --------------------------------------- ------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)........... $ 2,526,575 $ 2,407,392 $ 3,269,947
Net realized gain (loss) on
investments.......................... 12,567,447 6,230,833 7,342,477
Net unrealized appreciation
(depreciation) of investments........ 1,441,561 9,091,432 2,774,850
------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations.......... 16,535,583 17,729,657 13,387,274
------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A.......... (2,228,985) (2,069,737) (2,954,931)
Net investment income-Class B.......... (175,820) (153,775) (187,678)
Net realized gains-Class A............. (6,073,957) (5,411,740) --
Net realized gains-Class B............. (729,449) (505,229) --
------------ ------------ ------------
Total distributions.................. (9,208,211) (8,140,481) (3,142,609)
------------ ------------ ------------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 26,292,960 18,892,681 13,294,852
Reinvestment of distributions...... 8,079,229 7,290,097 2,837,444
Cost of shares redeemed............ (18,524,492) (14,230,724) (27,788,751)
------------ ------------ ------------
15,847,697 11,952,054 (11,656,455)
------------ ------------ ------------
Class B:
Proceeds from shares sold.......... 7,033,105 4,565,543 2,798,462
Reinvestment of distributions...... 899,497 654,659 182,590
Cost of shares redeemed............ (2,232,696) (1,112,670) (2,096,554)
------------ ------------ ------------
5,699,906 4,107,532 884,498
------------ ------------ ------------
Net increase (decrease) from share
transactions..................... 21,547,603 16,059,586 (10,771,957)
------------ ------------ ------------
Net increase (decrease) in net
assets......................... 28,874,975 25,648,762 (527,292)
NET ASSETS
Beginning of period.................. 136,820,627 111,171,865 111,699,157
------------ ------------ ------------
End of period+....................... $165,695,602 $136,820,627 $111,171,865
============ ============ ============
+Includes undistributed net
investment income of................. $ 770,181 $ 647,161 $ 463,281
============ ============ ============
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 3,318,123 2,495,558 1,993,525
Issued for distributions
reinvested....................... 1,076,259 998,117 423,434
Redeemed........................... (2,340,185) (1,889,537) (4,158,047)
------------ ------------ ------------
Net increase (decrease) in Class A
shares outstanding............... 2,054,197 1,604,138 (1,741,088)
============ ============ ============
Class B:
Sold............................... 899,686 605,451 422,620
Issued for distributions
reinvested....................... 121,706 90,925 27,429
Redeemed........................... (284,771) (149,886) (315,946)
------------ ------------ ------------
Net increase (decrease) in Class B
shares outstanding............... 736,621 546,490 134,103
============ ============ ============
</TABLE>
See notes to financial statements
72
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
MID-CAP OPPORTUNITY SPECIAL SITUATIONS
------------------------------------- ----------------------------------------
10/1/98 TO 11/1/97 TO 11/1/96 TO 10/1/98 TO 1/1/98 TO 1/1/97 TO
9/30/99 9/30/98 10/31/97 9/30/99 9/30/98 12/31/97
- --------------------------------------- ----------- ----------- ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)........... $ (385,659) $ (105,026) $ (58,391) $ (2,108,706) $ (612,879) $ (937,036)
Net realized gain (loss) on
investments.......................... 8,318,436 (3,844,115) 1,997,140 15,641,687 (5,056,550) 17,709,890
Net unrealized appreciation
(depreciation) of investments........ 7,655,565 (2,909,788) 3,087,322 39,320,820 (37,274,025) 10,188,540
----------- ----------- ----------- ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations.......... 15,588,342 (6,858,929) 5,026,071 52,853,801 (42,943,454) 26,961,394
----------- ----------- ----------- ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A.......... -- -- (36,607) -- -- --
Net investment income-Class B.......... -- -- -- -- -- --
Net realized gains-Class A............. -- (1,720,339) (673,761) -- -- (15,341,882)
Net realized gains-Class B............. -- (204,066) (52,869) -- -- (1,322,522)
----------- ----------- ----------- ------------ ------------ ------------
Total distributions.................. -- (1,924,405) (763,237) -- -- (16,664,404)
----------- ----------- ----------- ------------ ------------ ------------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 12,420,250 14,851,341 10,263,593 25,887,175 31,611,943 41,394,544
Reinvestment of distributions...... -- 1,703,247 696,970 -- -- 14,688,933
Cost of shares redeemed............ (6,972,115) (4,664,684) (3,053,623) (48,042,333) (26,829,523) (30,181,586)
----------- ----------- ----------- ------------ ------------ ------------
5,448,135 11,889,904 7,906,940 (22,155,158) 4,782,420 25,901,891
----------- ----------- ----------- ------------ ------------ ------------
Class B:
Proceeds from shares sold.......... 2,257,965 2,511,193 1,556,469 4,785,997 5,096,254 6,513,410
Reinvestment of distributions...... -- 203,911 52,868 -- -- 1,315,908
Cost of shares redeemed............ (841,719) (497,826) (183,075) (5,042,300) (2,440,295) (1,904,821)
----------- ----------- ----------- ------------ ------------ ------------
1,416,246 2,217,278 1,426,262 (256,303) 2,655,959 5,924,497
----------- ----------- ----------- ------------ ------------ ------------
Net increase (decrease) from share
transactions...................... 6,864,381 14,107,182 9,333,202 (22,411,461) 7,438,379 31,826,388
----------- ----------- ----------- ------------ ------------ ------------
Net increase (decrease) in net
assets.......................... 22,452,723 5,323,848 13,596,036 30,442,340 (35,505,075) 42,123,378
NET ASSETS
Beginning of period.................. 34,566,229 29,242,381 15,646,345 175,186,480 210,691,555 168,568,177
----------- ----------- ----------- ------------ ------------ ------------
End of period+....................... $57,018,952 $34,566,229 $29,242,381 $205,628,820 $175,186,480 $210,691,555
=========== =========== =========== ============ ============ ============
+Includes undistributed net
investment income of................. $ -- $ -- $ -- $ -- $ -- $ --
=========== =========== =========== ============ ============ ============
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 630,256 845,064 610,878 1,222,125 1,427,349 1,821,611
Issued for distributions
reinvested........................ -- 97,719 45,613 -- -- 662,260
Redeemed........................... (364,219) (265,776) (187,193) (2,243,476) (1,215,191) (1,367,038)
----------- ----------- ----------- ------------ ------------ ------------
Net increase (decrease) in Class A
shares outstanding................ 266,037 677,007 469,298 (1,021,351) 212,158 1,116,833
=========== =========== =========== ============ ============ ============
Class B:
Sold............................... 116,697 147,503 92,935 231,857 234,967 287,155
Issued for distributions
reinvested........................ -- 11,931 3,501 -- -- 60,669
Redeemed........................... (44,116) (29,310) (11,554) (242,807) (113,798) (87,818)
----------- ----------- ----------- ------------ ------------ ------------
Net increase (decrease) in Class B
shares outstanding................ 72,581 130,124 84,882 (10,950) 121,169 260,006
=========== =========== =========== ============ ============ ============
</TABLE>
See notes to financial statements
73
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS (continued)
FIRST INVESTORS
<TABLE>
<CAPTION>
- -------------------------------------------------------
FOCUSED EQUITY
--------------
3/22/99** TO
9/30/99
- --------------------------------------- --------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)........... $ (293,194)
Net realized gain on investments and
foreign currency transactions........ 6,594
Net unrealized appreciation
(depreciation) of investments and
foreign currency transactions........ 2,479,505
--------------
Net increase (decrease) in net assets
resulting from operations.......... 2,192,905
--------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A.......... --
Net investment income-Class B.......... --
Net realized gains-Class A............. --
Net realized gains-Class B............. --
--------------
Total distributions.................. --
--------------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 58,525,759
Reinvestment of distributions...... --
Cost of shares redeemed............ (1,223,549)
--------------
57,302,210
--------------
Class B:
Proceeds from shares sold.......... 14,313,156
Reinvestment of distributions...... --
Cost of shares redeemed............ (494,783)
--------------
13,818,373
--------------
Net increase (decrease) from share
transactions..................... 71,120,583
--------------
Net increase (decrease) in net
assets......................... 73,313,488
NET ASSETS
Beginning of period.................. --
--------------
End of period+....................... $ 73,313,488
==============
+Includes accumulated deficit in net
investment income of................. $ --
==============
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 5,551,442
Issued for distributions
reinvested....................... --
Redeemed........................... (112,550)
--------------
Net increase (decrease) in Class A
shares outstanding............... 5,438,892
==============
Class B:
Sold............................... 1,349,781
Issued for distributions
reinvested....................... --
Redeemed........................... (45,791)
--------------
Net increase in Class B shares
outstanding...................... 1,303,990
==============
</TABLE>
** Commencement of operations
See notes to financial statements
74
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
GLOBAL
----------------------------------------
10/1/98 TO 1/1/98 TO 1/1/97 TO
9/30/99 9/30/98 12/31/97
- --------------------------------------- ------------ ------------ ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS
Net investment income (loss)........... $ (215,898) $ 209,920 $ 1,128,454
Net realized gain on investments and
foreign currency transactions........ 34,466,572 8,576,598 21,938,853
Net unrealized appreciation
(depreciation) of investments and
foreign currency transactions........ 45,266,566 (11,823,004) (1,723,731)
------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations.......... 79,517,240 (3,036,486) 21,343,576
------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income-Class A.......... (122,828) -- (1,053,231)
Net investment income-Class B.......... -- -- --
Net realized gains-Class A............. (3,199,287) -- (26,486,799)
Net realized gains-Class B............. (150,049) -- (1,019,942)
------------ ------------ ------------
Total distributions.................. (3,472,164) -- (28,559,972)
------------ ------------ ------------
SHARE TRANSACTIONS*
Class A:
Proceeds from shares sold.......... 23,895,185 25,307,313 35,195,348
Reinvestment of distributions...... 3,187,812 -- 27,005,495
Cost of shares redeemed............ (44,619,545) (38,607,860) (41,510,319)
------------ ------------ ------------
(17,536,548) (13,300,547) 20,690,524
------------ ------------ ------------
Class B:
Proceeds from shares sold.......... 4,851,361 3,446,279 5,760,337
Reinvestment of distributions...... 149,378 -- 1,014,030
Cost of shares redeemed............ (2,406,293) (1,621,778) (964,600)
------------ ------------ ------------
2,594,446 1,824,501 5,809,767
------------ ------------ ------------
Net increase (decrease) from share
transactions...................... (14,942,102) (11,476,046) 26,500,291
------------ ------------ ------------
Net increase (decrease) in net
assets.......................... 61,102,974 (14,512,532) 19,283,895
NET ASSETS
Beginning of period.................. 273,203,552 287,716,084 268,432,189
------------ ------------ ------------
End of period+....................... $334,306,526 $273,203,552 $287,716,084
============ ============ ============
+Includes accumulated deficit in net
investment income of................. $ -- $ (22,880) $ (92,005)
============ ============ ============
*SHARES ISSUED AND REDEEMED
Class A:
Sold............................... 3,141,881 3,513,532 4,989,223
Issued for distributions
reinvested........................ 462,757 -- 4,213,026
Redeemed........................... (5,877,187) (5,437,027) (5,897,153)
------------ ------------ ------------
Net increase (decrease) in Class A
shares outstanding................ (2,272,549) (1,923,495) 3,305,096
============ ============ ============
Class B:
Sold............................... 649,918 492,513 820,925
Issued for distributions
reinvested........................ 22,262 -- 160,702
Redeemed........................... (326,673) (236,454) (138,029)
------------ ------------ ------------
Net increase in Class B shares
outstanding....................... 345,507 256,059 843,598
============ ============ ============
</TABLE>
** Commencement of operations
See notes to financial statements
75
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES--First Investors Total Return Fund, First
Investors Blue Chip Fund and First Investors Special Situations Fund, each a
series of First Investors Series Fund ("Series Fund"), a Massachusetts business
trust; First Investors Growth & Income Fund, First Investors Utilities Income
Fund, First Investors Mid-Cap Opportunity Fund and First Investors Focused
Equity Fund, each a series of First Investors Series Fund II, Inc. ("Series
Fund II"), a Maryland corporation; and First Investors Global Fund, Inc.
("Global Fund"), a Maryland corporation, are registered under the Investment
Company Act of 1940 (the "1940 Act") as diversified, open-end management
investment companies, with the exception of First Investors Focused Equity Fund,
which is registered as a non-diversified investment company. Each fund accounts
separately for the assets, liabilities, and operations of the fund. Series Fund
offers two additional series which are not included in this report. The
objective of each Fund is as follows:
TOTAL RETURN FUND seeks high, long-term total investment return consistent with
moderate investment risk.
GROWTH & INCOME FUND seeks long-term growth of capital and current income.
BLUE CHIP FUND seeks high total investment return consistent with the
preservation of capital.
UTILITIES INCOME FUND primarily seeks high current income and secondarily long-
term capital appreciation.
MID-CAP OPPORTUNITY FUND seeks long-term capital growth.
SPECIAL SITUATIONS FUND seeks long-term growth of capital.
FOCUSED EQUITY FUND seeks capital appreciation.
GLOBAL FUND primarily seeks long-term capital growth and secondarily to earn a
reasonable level of current income.
On March 19, 1998, the Boards of Directors/Trustees of the Series Fund, Series
Fund II and Global Fund approved a change in the fiscal year-end of each of the
above listed Funds to September 30 (with the exception of First Investors
Focused Equity Fund, which commenced operations on March 22, 1999). Previously,
the fiscal year-ends were December 31 for the Total Return Fund, Blue Chip Fund,
Special Situations Fund and Global Fund, and October 31 for the Growth & Income
Fund, Utilities Income Fund and Mid-Cap Opportunity Fund.
76
<PAGE>
A. Security Valuation--Except as provided below, a security listed or traded on
an exchange or the Nasdaq Stock Market is valued at its last sale price on the
exchange or market where the security is principally traded, and lacking any
sales, the security is valued at the mean between the closing bid and asked
prices. Securities traded in the over-the-counter ("OTC") market (including
securities listed on exchanges whose primary market is believed to be OTC) are
valued at the mean between the last bid and asked prices based upon quotes
furnished by a market maker for such securities. Securities may also be priced
by a pricing service. The pricing service uses quotations obtained from
investment dealers or brokers, information with respect to market transactions
in comparable securities and other available information in determining value.
Short-term debt securities that mature in 60 days or less are valued at
amortized cost. Securities for which market quotations are not readily available
and other assets are valued on a consistent basis at fair value as determined in
good faith by or under the supervision of the particular Fund's officers in a
manner specifically authorized by the Boards of Directors/Trustees. For
valuation purposes, where applicable, quotations of foreign securities in
foreign currency are translated to U.S. dollar equivalents using the foreign
exchange quotation in effect.
B. Federal Income Taxes--No provision has been made for federal income taxes on
net income or capital gains since it is the policy of each Fund to continue to
comply with the special provisions of the Internal Revenue Code applicable to
investment companies and to make sufficient distributions of income and capital
gains (in excess of any available capital loss carryovers) to relieve it from
all, or substantially all, such taxes.
C. Distributions to Shareholders--Dividends from net investment income, if any,
of Total Return Fund, Growth & Income Fund, Blue Chip Fund and Utilities Income
Fund are declared and paid quarterly. Dividends from net investment income, if
any, of Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund
and Global Fund are declared and paid annually. Distributions from net realized
capital gains, if any, are normally declared and paid annually. Income dividends
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for capital loss
carryforwards, deferral of wash sales, post-October capital losses, net
operating losses and foreign currency transactions.
D. Expense Allocation--Expenses directly charged or attributable to a Fund are
paid from the assets of that Fund. General expenses of Series Fund and Series
Fund II are allocated among and charged to the assets of each Fund in the Series
77
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
on a fair and equitable basis, which may be based on the relative assets of each
Fund or the nature of the services performed and relative applicability to each
Fund.
E. Repurchase Agreements--Securities pledged as collateral for repurchase
agreements entered into by the Global Fund are held by the Fund's custodian
until maturity of the repurchase agreement. The agreements provide that Global
Fund will receive, as collateral, securities with a market value which will at
all times be at least equal to 100% of the amount invested by Global Fund.
F. Use of Estimates--The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenue and expense during the reporting period. Actual results could differ
from those estimates.
G. Foreign Currency Translations--The accounting records of Global Fund are
maintained in U.S. dollars. Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S. dollars
at the date of valuation. Purchases and sales of investment securities, dividend
income and certain expenses are translated to U.S. dollars at the rates of
exchange prevailing on the respective dates of such transactions.
Global Fund does not isolate that portion of gains and losses on investments
which is due to changes in foreign exchange rates from that which is due to
changes in market prices of the investments. Such fluctuations are included with
the net realized and unrealized gains and losses from investments.
Net realized and unrealized gains and losses on foreign currency transactions
includes gains and losses from the sales of foreign currency and gains and
losses on accrued foreign dividends and related withholding taxes.
H. Other--Security transactions are accounted for on the date the securities are
purchased or sold. Cost is determined, and gains and losses are based, on the
identified cost basis for both financial statement and federal income tax
purposes. Dividend income is recorded on the ex-dividend date. Interest income
and estimated expenses are accrued daily. For the year ended September 30, 1999,
the Bank of New York, custodian for the Series Fund and Series Fund II, has
provided total credits in the amount of $103,206 against custodian charges based
on the uninvested cash balances of these Funds.
78
<PAGE>
2. PURCHASES AND SALES OF SECURITIES--For the year ended September 30, 1999,
purchases and sales of securities and long-term U.S. Government obligations
(excluding U.S. Treasury bills, repurchase agreements, short-term securities and
foreign currencies) were as follows:
<TABLE>
<CAPTION>
Long-Term U.S.
Securities Government Obligations
-------------------------- ------------------------
Cost of Proceeds Cost of Proceeds
Fund Purchases from Sales Purchases from Sales
- ---- ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
Total Return........................... $ 94,632,538 $ 86,508,529 $36,366,651 $27,155,158
Growth & Income........................ 525,690,408 423,230,685 -- --
Blue Chip.............................. 521,737,262 475,255,222 -- --
Utilities Income....................... 119,064,207 98,236,005 -- --
Mid-Cap Opportunity.................... 84,089,883 77,354,344 -- --
Special Situations..................... 253,257,872 266,584,674 -- --
Focused Equity......................... 95,781,445 29,107,003 -- --
Global................................. 281,947,333 296,363,562 -- --
</TABLE>
At September 30, 1999, aggregate cost and net unrealized appreciation of
securities for federal income tax purposes were as follows:
<TABLE>
<CAPTION>
Gross Gross
Aggregate Unrealized Unrealized Net Unrealized
Fund Cost Appreciation Depreciation Appreciation
- ---- ------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
Total Return........................... $ 93,623,565 $ 14,136,137 $ 2,889,329 $ 11,246,808
Growth & Income........................ 360,391,887 108,209,366 10,662,744 97,546,622
Blue Chip.............................. 397,301,831 164,014,136 8,941,870 155,072,266
Utilities Income....................... 138,368,330 32,630,367 6,223,367 26,407,000
Mid-Cap Opportunity.................... 47,852,477 12,009,050 2,710,558 9,298,492
Special Situations..................... 166,616,667 50,530,379 10,801,380 39,728,999
Focused Equity......................... 70,946,880 5,407,466 3,193,806 2,213,660
Global................................. 266,248,270 79,557,863 7,391,391 72,166,472
</TABLE>
3. ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES--Certain officers and
directors/trustees of the Funds are officers and directors of its investment
adviser, First Investors Management Company, Inc. ("FIMCO"), its underwriter,
First Investors Corporation ("FIC"), its transfer agent, Administrative Data
Management Corp. ("ADM") and/or First Financial Savings Bank, S.L.A. ("FFS"),
custodian of the Funds' Individual Retirement Accounts. Directors/trustees of
the
79
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
Funds who are not "interested persons" of the Funds as defined in the 1940 Act
are remunerated by the Funds. For the year ended September 30, 1999, total
directors/trustees fees accrued by the Funds amounted to $68,463.
The Investment Advisory Agreements provide as compensation to FIMCO, an annual
fee, payable monthly, at the following rates:
TOTAL RETURN, BLUE CHIP, MID-CAP OPPORTUNITY AND SPECIAL SITUATIONS FUNDS--1% on
the first $200 million of each Fund's average daily net assets, .75% on the next
$300 million, declining by .03% on each $250 million thereafter, down to .66% on
average daily net assets over $1 billion. FIMCO has waived 25% of the 1% annual
fee on the first $200 million of each Fund's average daily net assets for the
year ended September 30, 1999.
GROWTH & INCOME, UTILITIES INCOME AND FOCUSED EQUITY FUNDS--.75% on the first
$300 million of each Fund's average daily net assets, .72% on the next $200
million, .69% on the next $250 million and .66% on average daily net assets over
$750 million.
FIMCO, pursuant to an expense limitation agreement, has agreed to reimburse the
Focused Equity Fund for organizational expense and expenses incurred during the
fiscal year ending September 30, 1999, to the extent necessary to limit the
Focused Equity Fund's total expenses to 1.75% of the average daily net assets on
the Class A shares and 2.45% of the average daily net assets on the Class B
shares. FIMCO and the Focused Equity Fund have agreed that any expenses of the
Focused Equity Fund reimbursed by FIMCO pursuant to this agreement shall be
repaid to FIMCO by the Focused Equity Fund in the first, second, or third (or
all) fiscal years following the year ending September 30, 1999, if the total
expenses of the Focused Equity Fund for such year or years do not exceed 1.75%
of the average daily net assets on Class A shares and 2.45% of the average daily
net assets on Class B shares or any lower expense limitations to which FIMCO may
otherwise agree. At September 30, 1999 the total organizational expenses and
expenses incurred in excess of the above stated limitations was $99,161. This
amount is subject to recapture by FIMCO from the Focused Equity Fund based on
the parameters discussed above.
GLOBAL FUND--1% on the first $250 million of the Fund's average daily net
assets, declining by .03% on each $250 million thereafter, down to .91% on
average daily net assets over $750 million.
80
<PAGE>
For the year ended September 30, 1999, total advisory fees accrued to FIMCO by
the Funds were $15,482,718 of which $1,351,913 was waived. In addition, FIMCO
assumed $41,267 of the Focused Equity Fund's expenses.
For the year ended September 30, 1999, FIC, as underwriter, received $12,961,557
in commissions from the sale of shares of the Funds, after allowing $48,035 to
other dealers. Shareholder servicing costs included $3,089,851 in transfer agent
fees accrued to ADM and $1,097,049 in IRA custodian fees accrued to FFS.
Pursuant to distribution plans adopted under Rule 12b-1 of the 1940 Act, each
Fund is authorized to pay FIC a fee up to .30% of the average daily net assets
of the Class A shares and 1% of the average daily net assets of the Class B
shares on an annualized basis each fiscal year, payable monthly. The fee
consists of a distribution fee and a service fee. The service fee is paid for
the ongoing servicing of clients who are shareholders of that Fund. For the year
ended September 30, 1999, total distribution plan fees accrued to FIC by the
Funds amounted to $6,740,710.
Wellington Management Company, LLP ("Wellington") serves as investment
subadviser to Global Fund. Arnhold and S. Bleichroeder, Inc. serves as
investment subadviser to Focused Equity Fund. The subadvisers are paid by FIMCO
and not by the Funds.
81
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
4. FORWARD CURRENCY CONTRACTS--A forward currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future date.
When Global Fund purchases or sells foreign securities it customarily enters
into a forward currency contract to minimize foreign exchange risk between the
trade date and the settlement date of such transactions. The Fund could be
exposed to risk if counter parties to the contracts are unable to meet the terms
of their contracts or if the value of the foreign currency changes unfavorably.
Global Fund had the following forward currency contracts outstanding at
September 30, 1999:
<TABLE>
<CAPTION>
Contracts to Buy Unrealized
Foreign Currency In Exchange for Settlement Date Gain (Loss)
- ------------------------------ --------------- --------------- -----------
<C> <S> <C> <C> <C>
554,450 British Pounds U.S. $913,124 10/1/99 U.S. $2,218
1,079,229 Euro 1,149,375 10/5/99 (1,494)
114,428,622 Japanese Yen 1,074,750 10/5/99 (8,506)
523,353 British Pounds 861,912 10/7/99 256
904,405 Euro 963,189 10/7/99 (1,404)
-------------- -----------
$4,962,350 $(8,930)
-------------- -----------
</TABLE>
<TABLE>
<CAPTION>
Contracts to Sell Unrealized
Foreign Currency In Exchange for Settlement Date Gain (Loss)
- ------------------------------- --------------- --------------- -----------
<C> <S> <C> <C> <C>
38,458,473 Japanese Yen U.S. $361,214 10/1/99 U.S. $1,260
5,589 Hong Kong Dollars 719 10/5/99 --
232,491 Euro 247,603 10/29/99 (1,748)
-------------- -----------
$609,536 $(488)
-------------- -----------
Unrealized Loss on Forward Currency Contracts $(9,418)
===========
</TABLE>
5. CAPITAL--Each Fund sells two classes of shares, Class A and Class B, each
with a public offering price that reflects different sales charges and expense
levels. Class A shares are sold with an initial sales charge of up to 6.25% of
the amount invested and together with the Class B shares are subject to
distribution plan fees as described in Note 3. Class B shares are sold without
an initial sales charge, but are generally subject to a contingent deferred
sales charge which declines in steps from 4% to 0% over a six-year period.
Class B shares automatically convert into Class A shares after eight years.
Realized and unrealized gains or losses, investment income and expenses (other
than distribution plan fees and certain other class expenses) are allocated
daily to each class of shares based upon the relative proportion of net assets
of each class. The Series Fund has established an unlimited number of shares of
beneficial interest for both Class A and Class B shares. Of the 100,000,000
shares originally designated to each Fund, Series Fund II has classified
50,000,000 shares as Class A and 50,000,000 shares as Class B for each Fund. Of
the 100,000,000 Global Fund shares originally authorized, the Fund has
designated 65,000,000 shares as Class A and 35,000,000 shares as Class B.
82
<PAGE>
6. RULE 144A SECURITIES--Under Rule 144A, certain restricted securities are
exempt from the registration requirements of the Securities Act of 1933 and may
only be sold to qualified institutional investors. At September 30, 1999, Total
Return Fund held one 144A security with a value of $905,000. The security
represents 0.9% of the Fund's net assets and is valued as set forth in Note 1A.
7. COMMENCEMENT OF OPERATIONS--The Focused Equity Fund commenced operations on
March 22, 1999.
8. SUBSEQUENT EVENTS--The following Funds declared per share distributions of
net realized capital gains to shareholders of record as of October 29, 1999,
payable November 10, 1999: Total Return Fund $0.402, Growth & Income Fund
$1.549, Blue Chip Fund, $1.649, Utilities Income Fund, $0.599, Mid-Cap
Opportunity Fund, $2.279, Special Situations Fund, $1.206 and Global Fund,
$0.889.
83
<PAGE>
FINANCIAL HIGHLIGHTS
FIRST INVESTORS
The following table sets forth the per share operating performance data for a
share outstanding, total return, ratios to average net assets and other
supplemental data for each period indicated.
<TABLE>
- ----------------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
-----------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET REALIZED LESS DISTRIBUTIONS
NET ASSET AND FROM
VALUE NET UNREALIZED ----------------------
--------- INVESTMENT GAIN (LOSS) TOTAL FROM NET NET
BEGINNING INCOME ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAIN DISTRIBUTIONS
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
TOTAL RETURN FUND
CLASS A
1994(h)........ $ 11.88 $ .21 $ (.62) $ (.41) $ .19 $ .39 $ .58
1995(h)........ 10.89 .39 2.50 2.89 .37 .44 .81
1996(h)........ 12.97 .39 .97 1.36 .41 1.12 1.53
1997(h)........ 12.80 .26 2.04 2.30 .28 1.08 1.36
1998(a)........ 13.74 .23 .43 .66 .13 -- .13
1999(f)........ 14.27 .29 1.26 1.55 .30 1.18 1.48
CLASS B
1995(b)........ $ 10.90 $ .25 $ 2.54 $ 2.79 $ .33 $ .44 $ .77
1996(h)........ 12.92 .32 .94 1.26 .34 1.12 1.46
1997(h)........ 12.72 .21 1.97 2.18 .19 1.08 1.27
1998(a)........ 13.63 .17 .41 .58 .08 -- .08
1999(f)........ 14.13 .21 1.22 1.43 .21 1.18 1.39
- ----------------------------------------------------------------------------------------------------------
GROWTH & INCOME FUND
CLASS A
1994(d)........ $ 6.56 $ .13 $ .11 $ .24 $ .11 $ -- $ .11
1995(d)........ 6.69 .16 1.13 1.29 .17 -- .17
1996(d)........ 7.81 .10 1.60 1.70 .12 -- .12
1997(d)........ 9.39 .06 2.36 2.42 .06 .16 .22
1998(c)........ 11.59 .05 .97 1.02 .03 .27 .30
1999(f)........ 12.31 .04 2.88 2.92 .05 -- .05
CLASS B
1995(e)........ $ 6.43 $ .08 $ 1.38 $ 1.46 $ .11 $ -- $ .11
1996(d)........ 7.78 .07 1.55 1.62 .07 -- .07
1997(d)........ 9.33 -- 2.32 2.32 .01 .16 .17
1998(c)........ 11.48 (.01) .94 .93 -- .27 .27
1999(f)........ 12.14 (.04) 2.80 2.76 -- -- --
- ----------------------------------------------------------------------------------------------------------
</TABLE>
84
<PAGE>
The following table sets forth the per share operating performance data for a
share outstanding, total return, ratios to average net assets and other
supplemental data for each period indicated.
<TABLE>
- ------------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
--------------------------------------------------------------------------------
---------
RATIO TO AVERAGE NET
RATIO TO AVERAGE ASSETS BEFORE EXPENSES
NET NET ASSETS++ WAIVED OR ASSUMED
NET ASSET ASSETS ---------------------- -----------------------
VALUE TOTAL END OF NET NET PORTFOLIO
--------- RETURN PERIOD INVESTMENT INVESTMENT TURNOVER
END * (IN EXPENSES INCOME EXPENSES INCOME RATE
OF PERIOD (%) MILLIONS) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
TOTAL RETURN FUND
CLASS A
1994(h)........ $ 10.89 (3.45) $ 51 1.63 1.91 1.88 1.66 124
1995(h)........ 12.97 26.71 55 1.58 3.08 1.83 2.83 135
1996(h)........ 12.80 10.62 57 1.53 2.93 1.78 2.68 146
1997(h)........ 13.74 18.08 67 1.49 1.94 1.74 1.69 149
1998(a)........ 14.27 4.76 73 1.42+ 2.15+ 1.65+ 1.92+ 111
1999(f)........ 14.34 11.50 92 1.40 2.08 1.63 1.85 127
CLASS B
1995(b)........ $ 12.92 25.74 $ .3 2.41+ 2.24+ 2.67+ 1.98+ 135
1996(h)........ 12.72 9.86 1 2.32 2.14 2.49 1.97 146
1997(h)........ 13.63 17.24 3 2.19 1.24 2.44 .99 149
1998(a)........ 14.13 4.25 4 2.12+ 1.45+ 2.35+ 1.22+ 111
1999(f)........ 14.17 10.72 9 2.10 1.38 2.33 1.15 127
- ------------------------------------------------------------------------------------------------------------
GROWTH & INCOME FUND
CLASS A
1994(d)........ $ 6.69 3.67 $ 34 .67 2.26 1.83 1.11 6
1995(d)........ 7.81 19.51 63 .98 2.34 1.59 1.74 19
1996(d)........ 9.39 21.82 112 1.31 1.20 1.49 1.02 25
1997(d)........ 11.59 26.20 194 1.39 .55 1.43 .51 28
1998(c)........ 12.31 8.84 258 1.39+ .47+ N/A N/A 36
1999(f)........ 15.18 23.75 378 1.36 .29 N/A N/A 112
CLASS B
1995(e)........ $ 7.78 22.73 $ 4 1.90+ 2.23+ 2.61+ 1.52+ 19
1996(d)........ 9.33 20.92 12 2.03 .48 2.19 .31 25
1997(d)........ 11.48 25.23 27 2.09 (.15) 2.13 (.19) 28
1998(c)........ 12.14 8.19 43 2.09+ (.23)+ N/A N/A 36
1999(f)........ 14.90 22.77 77 2.06 (.41) N/A N/A 112
- ------------------------------------------------------------------------------------------------------------
</TABLE>
85
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
FIRST INVESTORS
<TABLE>
- -----------------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET REALIZED LESS DISTRIBUTIONS
NET ASSET AND FROM
VALUE NET UNREALIZED ----------------------
--------- INVESTMENT GAIN (LOSS) TOTAL FROM NET NET
BEGINNING INCOME ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAIN DISTRIBUTIONS
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BLUE CHIP FUND
CLASS A
1994(h)........ $ 15.58 $ .11 $ (.58) $ (.47) $ .09 $ 1.56 $ 1.65
1995(h)........ 13.46 .19 4.37 4.56 .20 .60 .80
1996(h)........ 17.22 .14 3.39 3.53 .17 1.11 1.28
1997(h)........ 19.47 .09 4.98 5.07 .08 1.62 1.70
1998(a)........ 22.84 .04 (.39) (.35) .03 -- .03
1999(f)........ 22.46 -- 5.46 5.46 .02 .75 .77
CLASS B
1995(b)........ $ 13.51 $ .10 $ 4.31 $ 4.41 $ .16 $ .60 $ .76
1996(h)........ 17.16 .06 3.32 3.38 .06 1.11 1.17
1997(h)........ 19.37 (.03) 4.91 4.88 -- 1.62 1.62
1998(a)........ 22.63 (.06) (.42) (.48) -- -- --
1999(f)........ 22.15 (.14) 5.35 5.21 -- .75 .75
- -----------------------------------------------------------------------------------------------------------
UTILITIES INCOME FUND
CLASS A
1994(d)........ $ 5.92 $ .24 $ (.84) $ (.60) $ .23 $ .01 $ .24
1995(d)........ 5.08 .23 .83 1.06 .24 -- .24
1996(d)........ 5.90 .21 .52 .73 .22 -- .22
1997(d)........ 6.41 .20 .61 .81 .19 -- .19
1998(c)........ 7.03 .14 .96 1.10 .14 .37 .51
1999(f)........ 7.62 .13 .74 .87 .13 .37 .50
CLASS B
1995(e)........ $ 4.95 $ .14 $ .93 $ 1.07 $ .16 $ -- $ .16
1996(d)........ 5.86 .18 .49 .67 .18 -- .18
1997(d)........ 6.35 .15 .61 .76 .15 -- .15
1998(c)........ 6.96 .10 .94 1.04 .10 .37 .47
1999(f)........ 7.53 .08 .72 .80 .08 .37 .45
- -----------------------------------------------------------------------------------------------------------
</TABLE>
86
<PAGE>
<TABLE>
- -----------------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
------------------------------------------------------------------------------------
---------
RATIO TO AVERAGE NET
RATIO TO AVERAGE ASSETS BEFORE EXPENSES
NET NET ASSETS++ WAIVED OR ASSUMED
NET ASSET ASSETS ---------------------- -----------------------
VALUE TOTAL END OF NET NET PORTFOLIO
--------- RETURN PERIOD INVESTMENT INVESTMENT TURNOVER
END * (IN EXPENSES INCOME EXPENSES INCOME RATE
OF PERIOD (%) MILLIONS) (%) (%) (%) (%) (%)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BLUE CHIP FUND
CLASS A
1994(h)........ $ 13.46 (3.02) $ 124 1.54 .80 1.79 .55 82
1995(h)........ 17.22 34.01 170 1.49 1.23 1.74 .98 25
1996(h)........ 19.47 20.55 240 1.44 .78 1.67 .55 45
1997(h)........ 22.84 26.05 351 1.39 .40 1.64 .15 63
1998(a)........ 22.46 (1.55) 368 1.37+ .23+ 1.47+ .13+ 71
1999(f)........ 27.15 24.88 471 1.32 .01 1.41 (.08) 97
CLASS B
1995(b)........ $ 17.16 32.76 $ 5 2.20+ .52+ 2.46+ .26+ 25
1996(h)........ 19.37 19.71 17 2.22 -- 2.37 (.16) 45
1997(h)........ 22.63 25.19 37 2.09 (.30) 2.34 (.55) 63
1998(a)........ 22.15 (2.12) 47 2.07+ (.47)+ 2.17+ (.57)+ 71
1999(f)........ 26.61 24.07 70 2.02 (.69) 2.11 (.78) 97
- -----------------------------------------------------------------------------------------------------------------
UTILITIES INCOME FUND
CLASS A
1994(d)........ $ 5.08 (10.15) $ 63 .80 4.59 1.59 3.80 58
1995(d)........ 5.90 21.35 84 1.04 4.37 1.57 3.84 16
1996(d)........ 6.41 12.45 104 1.20 3.49 1.49 3.19 38
1997(d)........ 7.03 12.86 102 1.40 2.98 1.48 2.90 60
1998(c)........ 7.62 16.05 123 1.43+ 2.10+ N/A N/A 83
1999(f)........ 7.99 11.99 145 1.37 1.69 N/A N/A 65
CLASS B
1995(e)........ $ 5.86 21.99 $ 3 1.82+ 4.93+ 2.53+ 4.21+ 16
1996(d)........ 6.35 11.61 8 1.91 2.77 2.28 2.40 38
1997(d)........ 6.96 12.08 9 2.10 2.28 2.18 2.20 60
1998(c)........ 7.53 15.38 14 2.13+ 1.40+ N/A N/A 83
1999(f)........ 7.88 11.13 21 2.07 .99 N/A N/A 65
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
87
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
FIRST INVESTORS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
-----------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET REALIZED LESS DISTRIBUTIONS
NET ASSET AND FROM
VALUE NET UNREALIZED ----------------------
--------- INVESTMENT GAIN (LOSS) TOTAL FROM NET NET
BEGINNING INCOME ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAIN DISTRIBUTIONS
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
MID-CAP OPPORTUNITY FUND**
CLASS A
1994(d)........ $ 12.15 $ .08 $ (.33) $ (.25) $ .12 $ -- $ .12
1995(d)........ 11.78 .08 2.80 2.88 .08 -- .08
1996(d)........ 14.58 .04 1.57 1.61 .06 .84 .90
1997(d)........ 15.29 (.03) 4.02 3.99 .04 .68 .72
1998(c)........ 18.56 (.03) (2.82) (2.85) -- 1.18 1.18
1999(f)........ 14.53 (.13) 6.62 6.49 -- -- --
CLASS B
1995(e)........ $ 12.03 $ (.01) $ 2.49 $ 2.48 $ -- $ -- $ --
1996(d)........ 14.51 .01 1.47 1.48 .05 .84 .89
1997(d)........ 15.10 (.08) 3.89 3.81 -- .68 .68
1998(c)........ 18.23 (.12) (2.76) (2.88) -- 1.18 1.18
1999(f)........ 14.17 (.23) 6.41 6.18 -- -- --
- ----------------------------------------------------------------------------------------------------------
SPECIAL SITUATIONS FUND
CLASS A
1994(h)........ $ 18.00 $ (.04) $ (.62) $ (.66) $ -- $ .91 $ .91
1995(h)........ 16.43 (.01) 3.94 3.93 -- .73 .73
1996(h)........ 19.63 (.01) 2.28 2.27 -- 1.17 1.17
1997(h)........ 20.73 (.09) 3.44 3.35 -- 1.90 1.90
1998(a)........ 22.18 (.05) (4.30) (4.35) -- -- --
1999(f)........ 17.83 (.22) 5.79 5.57 -- -- --
CLASS B
1995(b)........ $ 16.40 $ (.01) $ 3.85 $ 3.84 $ -- $ .73 $ .73
1996(h)........ 19.51 (.14) 2.25 2.11 -- 1.17 1.17
1997(h)........ 20.45 (.15) 3.29 3.14 -- 1.90 1.90
1998(a)........ 21.69 (.13) (4.22) (4.35) -- -- --
1999(f)........ 17.34 (.36) 5.64 5.28 -- -- --
- ----------------------------------------------------------------------------------------------------------
FOCUSED EQUITY FUND
CLASS A
1999(g)........ $ 10.00 $ (.04) $ .92 $ .88 $ -- $ -- $ --
CLASS B
1999(g)........ $ 10.00 $ (.06) $ .90 $ .84 $ -- $ -- $ --
- ----------------------------------------------------------------------------------------------------------
</TABLE>
88
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
----------------------------------------------------------------------------------------------
---------
RATIO TO AVERAGE NET
RATIO TO AVERAGE ASSETS BEFORE EXPENSES
NET NET ASSETS++ WAIVED OR ASSUMED
NET ASSET ASSETS ------------------------- --------------------------
VALUE TOTAL END OF NET NET PORTFOLIO
--------- RETURN PERIOD INVESTMENT INVESTMENT TURNOVER
END * (IN EXPENSES INCOME EXPENSES INCOME RATE
OF PERIOD (%) MILLIONS) (%) (%) (%) (%) (%)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MID-CAP OPPORTUNITY FUND**
CLASS A
1994(d)........ $ 11.78 (2.05) $ 8 .90 .45 2.32 (.97) 29
1995(d)........ 14.58 24.59 9 1.34 .48 2.36 (.55) 106
1996(d)........ 15.29 11.64 14 1.57 .36 2.15 (.21) 118
1997(d)........ 18.56 27.09 26 1.50 (.21) 1.94 (.65) 90
1998(c)........ 14.53 (16.42) 30 1.50+ (.25)+ 1.89+ (.64)+ 102
1999(f)........ 21.02 44.67 50 1.50 (.69) 1.77 (.96) 171
CLASS B
1995(e)........ $ 14.51 20.62 $ .3 2.29+ (.03)+ 3.79+ (1.53)+ 106
1996(d)........ 15.10 10.80 1 2.30 (.37) 3.03 (1.10) 118
1997(d)........ 18.23 26.17 3 2.20 (.91) 2.64 (1.35) 90
1998(c)........ 14.17 (16.91) 4 2.20+ (.95)+ 2.59+ (1.34)+ 102
1999(f)........ 20.35 43.61 7 2.20 (1.39) 2.47 (1.66) 171
- --------------------------------------------------------------------------------------------------------------------------
SPECIAL SITUATIONS FUND
CLASS A
1994(h)........ $ 16.43 (3.66) $ 90 1.65 (.26) 1.90 (.51) 53
1995(h)........ 19.63 23.92 125 1.60 (.08) 1.85 (.33) 80
1996(h)........ 20.73 11.56 158 1.59 (.13) 1.84 (.38) 99
1997(h)........ 22.18 16.15 194 1.53 (.45) 1.78 (.70) 84
1998(a)........ 17.83 (19.61) 160 1.53+ (.32)+ 1.75+ (.54)+ 70
1999(f)........ 23.40 31.24 186 1.53 (.97) 1.76 (1.20) 132
CLASS B
1995(b)........ $ 19.51 23.42 $ 5 2.33+ (.81)+ 2.59+ (1.07)+ 80
1996(h)........ 20.45 10.81 10 2.38 (.92) 2.55 (1.09) 99
1997(h)........ 21.69 15.34 17 2.23 (1.15) 2.48 (1.40) 84
1998(a)........ 17.34 (20.06) 15 2.23+ (1.02)+ 2.45+ (1.24)+ 70
1999(f)........ 22.62 30.45 20 2.23 (1.67) 2.46 (1.90) 132
- --------------------------------------------------------------------------------------------------------------------------
FOCUSED EQUITY FUND
CLASS A
1999(g)........ $ 10.88 8.80 $ 59 1.75+ (.93)+ 1.90+ (1.08)+ 57
CLASS B
1999(g)........ $ 10.84 8.40 $ 14 2.45+ (1.63)+ 2.60+ (1.78)+ 57
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
89
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
FIRST INVESTORS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
-----------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
---------------------------------------
NET REALIZED LESS DISTRIBUTIONS
NET ASSET AND FROM
VALUE NET UNREALIZED ----------------------
--------- INVESTMENT GAIN (LOSS) TOTAL FROM NET NET
BEGINNING INCOME ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAIN DISTRIBUTIONS
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
GLOBAL FUND
CLASS A
1994(h)........ $ 6.27 $ .03 $ (.27) $ (.24) $ .03 $ .16 $ .19
1995(h)........ 5.84 .03 1.01 1.04 .04 .27 .31
1996(h)........ 6.57 .04 .91 .95 .04 .89 .93
1997(h)........ 6.59 .03 .50 .53 .03 .68 .71
1998(a)........ 6.41 .01 (.09) (.08) -- -- --
1999(f)........ 6.33 -- 1.86 1.86 -- .08 .08
- ----------------------------------------------------------------------------------------------------------
CLASS B
1995(b)........ $ 5.76 $ .03 $ 1.05 $ 1.08 $ .03 $ .27 $ .30
1996(h)........ 6.54 (.01) .88 .87 .02 .88 .90
1997(h)........ 6.51 (.01) .49 .48 -- .68 .68
1998(a)........ 6.31 (.03) (.09) (.12) -- -- --
1999(f)........ 6.19 (.04) 1.81 1.77 -- .08 .08
- ----------------------------------------------------------------------------------------------------------
</TABLE>
+ Annualized
++ Net of expenses waived or assumed by the investment adviser (Note 3).
* Calculated without sales charges.
**Prior to February 15, 1996, known as Made In The U.S.A. Fund, and prior to
December 31, 1997, known as U.S.A. Mid-Cap Opportunity Fund.
(a) For the period January 1, 1998 to September 30, 1998.
(b) For the period January 12, 1995 (date Class B shares first offered) to
December 31, 1995.
(c) For the period November 1, 1997 to September 30, 1998.
(d) For the fiscal year ended October 31.
(e) For the period January 12, 1995 (date Class B shares first offered) to
October 31, 1995.
(f) For the period October 1, 1998 to September 30, 1999.
(g) For the period March 22, 1999 (commencement of operations) to September 30,
1999.
(h) For the calendar year ended December 31.
See notes to financial statements
90
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
--------------------------------------------------------------------------------------
---------
RATIO TO AVERAGE NET
ASSETS BEFORE
RATIO TO AVERAGE EXPENSES
NET NET ASSETS++ WAIVED OR ASSUMED
NET ASSET ASSETS ------------------------ ---------------------
VALUE TOTAL END OF NET NET PORTFOLIO
--------- RETURN PERIOD INVESTMENT INVESTMENT TURNOVER
END * (IN EXPENSES INCOME EXPENSES INCOME RATE
OF PERIOD (%) MILLIONS) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
GLOBAL FUND
CLASS A
1994(h)........ $ 5.84 (3.78) $ 214 1.84 .45 N/A N/A 56
1995(h)........ 6.57 17.83 228 1.83 .55 N/A N/A 47
1996(h)........ 6.59 14.43 263 1.83 .50 N/A N/A 73
1997(h)........ 6.41 7.98 277 1.82 .41 N/A N/A 70
1998(a)........ 6.33 (1.25) 261 1.82+ .12+ N/A N/A 82
1999(f)........ 8.11 29.63 316 1.72 (.03) N/A N/A 92
- ------------------------------------------------------------------------------------------------------------------
CLASS B
1995(b)........ $ 6.54 18.80 $ 1 2.56+ (.19)+ N/A N/A 47
1996(h)........ 6.51 13.33 5 2.54 (.21) N/A N/A 73
1997(h)........ 6.31 7.36 10 2.52 (.29) N/A N/A 70
1998(a)........ 6.19 (1.90) 12 2.52+ (.58)+ N/A N/A 82
1999(f)........ 7.88 28.78 18 2.42 (.73) N/A N/A 92
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
91
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Trustees/Directors of
First Investors Series Fund
First Investors Series Fund II, Inc.
First Investors Global Fund, Inc.
We have audited the accompanying statement of assets and liabilities, including
the portfolios of investments, of the Blue Chip Fund, Special Situations Fund
and Total Return Fund (each a series of First Investors Series Fund), the
Focused Equity Fund, Growth & Income Fund, Mid-Cap Opportunity Fund and
Utilities Income Fund (each a series of First Investors Series Fund II, Inc.),
and First Investors Global Fund, Inc. as of September 30, 1999, the related
statement of operations for the year or period then ended, the statement of
changes in net assets and the financial highlights for each of the periods
indicated thereon. These financial statements and financial highlights are the
responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 1999, by correspondence with the custodian and brokers. Where
brokers have not replied to our confirmation requests, we have carried out other
appropriate auditing procedures. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Blue Chip Fund, Special Situations Fund, Total Return Fund, Focused Equity Fund,
Growth & Income Fund, Mid-Cap Opportunity Fund, Utilities Income Fund, and
Global Fund at September 30, 1999, and the results of their operations, changes
in their net assets and financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
October 29, 1999
92
<PAGE>
FIRST INVESTORS EQUITY FUNDS
DIRECTORS
- -------------------------------
JAMES J. COY (Emeritus)
GLENN O. HEAD
KATHRYN S. HEAD
LARRY R. LAVOIE
REX R. REED
HERBERT RUBINSTEIN
NANCY S. SCHAENEN
JAMES M. SRYGLEY
JOHN T. SULLIVAN
ROBERT F. WENTWORTH
OFFICERS
- -------------------------------
GLENN O. HEAD
President
DENNIS T. FITZPATRICK
Vice President
NANCY W. JONES
Vice President
PATRICIA D. POITRA
Vice President
CLARK D. WAGNER
Vice President
CONCETTA DURSO
Vice President and Secretary
JOSEPH I. BENEDEK
Treasurer
CAROL LERNER BROWN
Assistant Secretary
MARK S. SPENCER
Assistant Treasurer
93
<PAGE>
FIRST INVESTORS EQUITY FUNDS
SHAREHOLDER INFORMATION
- ---------------------------------------
INVESTMENT ADVISER
FIRST INVESTORS MANAGEMENT COMPANY, INC.
95 Wall Street
New York, NY 10005
SUBADVISER (Focused Equity Fund only)
ARNHOLD AND S. BLEICHROEDER, INC.
1345 Avenue of the Americas
New York, NY 10105
SUBADVISER (Global Fund only)
WELLINGTON MANAGEMENT COMPANY, LLP
75 State Street
Boston, MA 02109
UNDERWRITER
FIRST INVESTORS CORPORATION
95 Wall Street
New York, NY 10005
CUSTODIAN
THE BANK OF NEW YORK
48 Wall Street
New York, NY 10286
CUSTODIAN (Global Fund only)
BROWN BROTHERS HARRIMAN & CO.
40 Water Street
Boston, MA 02109
TRANSFER AGENT
ADMINISTRATIVE DATA MANAGEMENT CORP.
581 Main Street
Woodbridge, NJ 07095-1198
LEGAL COUNSEL
KIRKPATRICK & LOCKHART LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
AUDITORS
TAIT, WELLER & BAKER
Eight Penn Center Plaza
Philadelphia, PA 19103
It is the Funds' practice to mail only one copy of the annual and semi-annual
reports to any address at which more than one shareholder with the same last
name has indicated that mail is to be delivered. Additional copies of the
reports will be mailed if requested by any shareholder in writing or by calling
800-423-4026. The Funds will ensure that separate reports are sent to any
shareholder who subsequently changes his or her mailing address.
This report is authorized for distribution only to existing shareholders, and,
if given to prospective shareholders, must be accompanied or preceded by the
Funds' prospectus.
94
<PAGE>
NOTES
95
<PAGE>
NOTES
96
<PAGE>
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