<PAGE> 1
JOHN HANCOCK FUNDS
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
GLOBAL
TECHNOLOGY
FUND
SEMI-ANNUAL REPORT
JUNE 30, 1995
<PAGE> 2
DIRECTORS
Edward J. Boudreau, Jr.
Thomas W. L. Cameron
James F. Carlin
Charles F. Fretz*
Jack P. Gould*
Harold R. Hiser, Jr.*
Charles L. Ladner*
Patricia P. McCarter*
Steven R. Pruchansky*
Lt. Gen. Norman H. Smith, USMC (Ret.)*
John P. Toolan*
* Members of the Audit Committee
OFFICERS
Edward J. Boudreau, Jr.
Chairman and Chief Executive Officer
Robert G. Freedman
Vice Chairman and
Chief Investment Officer
Barry J. Gordon
President
Anne C. Hodsdon
Executive Vice President
Thomas H. Drohan
Senior Vice President and Secretary
James B. Little
Senior Vice President and
Chief Financial Officer
Michael P. DiCarlo
Senior Vice President
James K. Ho
Senior Vice President
Marc H. Klee
Senior Vice President
John A. Morin
Vice President
Susan S. Newton
Vice President, Assistant Secretary
and Compliance Officer
James J. Stokowski
Vice President and Treasurer
CUSTODIAN
Investors Bank & Trust Company
89 South Street
Boston, Massachusetts 02111
TRANSFER AGENT
John Hancock Investors Services Corporation
P.O. Box 9116
Boston, Massachusetts 02205-9116
INVESTMENT ADVISER
John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-7603
PRINCIPAL DISTRIBUTOR
John Hancock Funds, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-7603
LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109
CHAIRMAN'S MESSAGE
DEAR FELLOW SHAREHOLDERS:
Educating shareholders has always been one of the most important
responsibilities of a mutual fund company. But that challenge has taken on new
significance in the past several years. Looking at the most recent statistics,
you can see why. According to the Investment Company Institute, the mutual fund
industry now manages more than $2.3 trillion for investors. More than half of
that money has come into mutual funds in just the last four years. Today, there
are more than 95 million mutual fund shareholder accounts. That's up from 12
million in 1980. These are people, like you, who are investing in mutual funds
to save for a home, to send their children to college or to build a nest egg for
a comfortable retirement. This explosive growth, coupled with the growing
complexity of the financial landscape, has made all of us in the mutual fund
industry work harder to inform our shareholders.
At John Hancock Funds, we strive to educate you about all aspects of your
fund: the performance, the strategies and the holdings. We want you to fully
understand what you own. We want you to have realistic expectations of the
potential rewards as well as the potential risks of your investment. These
shareholder reports -- which we send you twice a year -- are the best way to
give you the most in-depth and up-to-date information.
In the message that follows, the portfolio manager gives a candid commentary
on the market environment; the factors that affected performance; the Fund's
current investment strategies; and the outlook for the months ahead.
The ensuing financial statements provide a comprehensive look at the fund's
statistics and holdings.
We hope you find these shareholder reports a useful tool in evaluating your
investments. Of course, if you have any questions or need more information, feel
free to call one of our customer service representatives on our toll-free line
at 1-800-225-5291, from 8:00 a.m. to 8:00 p.m. eastern time, Monday through
Friday.
Sincerely,
/s/ Edward J. Boudreau, Jr.
- ---------------------------
EDWARD J. BOUDREAU, JR., CHAIRMAN AND CHIEF EXECUTIVE OFFICER
[A 1 1/4" x 1" photo of Edward J. Boudreau Jr., Chairman and Chief Executive
Officer, flush right, next to second paragraph.]
2
<PAGE> 3
BY BARRY GORDON AND
MARC KLEE, CO-PORTFOLIO MANAGERS
JOHN HANCOCK GLOBAL TECHNOLOGY FUND
FALLING INTEREST RATES AND LOW INFLATION PROPEL MARKETS
TO RECORD HIGHS; TECHNOLOGY STOCKS LEAD THE PACK
After a challenging year in 1994, several trends came together during the first
six months of 1995 to create a nearly ideal climate for technology stocks.
Number one, interest rates fell and inflationary fears subsided, igniting a
broad market rally. As rates fell, so did the cost of borrowing, resulting in
higher spending on capital goods and, thus, higher earnings for technology
companies. Number two, the U.S. dollar continued to lose value compared to most
other currencies, making U.S. products that much more competitive in foreign
markets. Technology companies -- because they tend to have substantial overseas
sales -- were among the prime beneficiaries. And number three, demand for
technology products rose as a byproduct of the continuing global push for higher
productivity.
Aided by these positive conditions, John Hancock Global Technology Fund
enjoyed a stellar period. For the six months ended June 30, 1995, the Fund's
Class A and Class B shares had total returns of 38.57% and 38.01%, respectively,
at net asset value. During the same period, the average science and technology
fund's total return was 27.59%, according to Lipper Analytical Services.(1)
Foreign investments were not a factor that helped the Fund outperform its
competitors.
["...several trends came together ... to create a nearly ideal climate for
technology stocks."]
[A 2 1/4"a x 3 1/4" photo of Barry Gordon and Marc Klee at bottom right. Photo
caption reads: "Barry Gordon (left) and Marc Klee (right), Co-Portfolio
Managers."]
3
<PAGE> 4
John Hancock Funds - Global Technology Fund
[Chart with heading "Top Five Common Stock Holdings" at top left hand column.
The chart lists five holdings: 1) Applied Materials 4.4%; 2) Nokia Corp. 4.2%;
3) Integrated Device Technology 4.2%; 4) LSI Logic 4.0%; 5) Adaptec 3.7%. As a
percentage of net assets on June 30, 1995.]
On the contrary, most foreign markets lagged the U.S. market, continuing a
recent trend in which foreign stocks have been a drag on the Fund's performance.
We remain committed to the long-term goal of capitalizing on global investment
opportunities. But lately as overseas growth has ebbed, we've cut back on
foreign investments -- from 16.5% of total assets on June 30, 1994, to about 10%
at the end of June 1995. Countries represented in the Fund besides the United
States were Finland, Hong Kong, Britain, Mexico, Chile, Peru, the Netherlands,
Israel and Norway.
What follows is a detailed discussion of the Fund's performance, organized
according to the three main themes that have guided our investment strategy.
Each accounts for roughly one-third of the Fund's total assets.
[Table entitled "Scorecard" at bottom of left hand column. The header for the
left column is "Investment"; the header for the right hand column is "Recent
performance...and what's behind the numbers." The first listing is "Applied
Materials" followed by an up arrow and the phrase "Weak dollar boosts sales."
The second listing is "Oracle Systems" followed by an up arrow and the phrase
"Strong demand from mainframe users." The third listing is "FTP Software"
followed by a down arrow and the phrase "Market developing slowly." Footnote
below reads: See "Schedule of Investments." Investment holdings are subject to
change.]
THE SEMICONDUCTOR CYCLE
Demand for semiconductors continues to exceed even the most optimistic
projections. Analysts worry about overcapacity as production plays catch-up with
demand, but those trends take time to develop. Meanwhile, the Fund continues to
profit from a broad range of investments in all subsectors of the semiconductor
industry. Among the chip-makers, our favorites include Applied Materials, the
dominant worldwide supplier of leading-edge manufacturing equipment, whose stock
price more than doubled during the period; LSI Logic, which makes custom chips
for specialized applications; and Integrated Device Technology, which makes SRAM
chips for personal computers. Demand for SRAM chips has exploded with the
development of Pentium-based computers and should increase even more with
Intel's release of the next-generation P6 chip. Another way we've found to
capitalize on the semiconductor cycle is through other equipment companies such
as Lam Research, an equipment manufacturer that supplies the chip-making
industry; and Teradyne, a chip-tester. Overall, semiconductor stocks as a
percentage of the Fund's total assets rose from 22% at the end of last year to
more than 30% in June 1995.
THE PRODUCTIVITY ENHANCEMENT CYCLE
The stocks in this group are all plays on the accelerating global trend toward
productivity enhancement through the innovative use of technology. Many are
companies that market to users of powerful mainframes and minicomputers. For
example, Oracle Systems and Informix, two large software holdings, sell
["Demand for semiconductors continues to exceed even the most optimistic
projections."]
4
<PAGE> 5
John Hancock Funds - Global Technology Fund
[Bar chart with heading "Fund Performance" at top of left hand column. Under the
heading is the footnote "For the six months ended June 30, 1995." The chart is
scaled in increments of 10% from top to bottom, with 40% at the top and 0% at
the bottom. Within the chart, there are three solid bars. The first represents
the 38.57% total return for John Hancock Global Technology Fund: Class A. The
second represents the 38.01% total return for the John Hancock Global Technology
Fund: Class B. The third represents the 27.59% total return for the average
science and technology fund. A footnote below reads: "Total returns for John
Hancock Global Technology Fund are at net asset value all distributions
reinvested. The average science and technology fund is tracked by Lipper
Analytical Services.(1) See following page for historical performance
information.]
relational databases designed to process mountains of data. Computer Associates
International, Inc. buys struggling software companies and successfully makes
them profitable by improving the marketing and distribution of their products.
On the hardware side, the Fund has large stakes in IBM, whose recent turnaround
is attributable largely to the revival of its mainframe business; and Adaptec,
which makes input/output devices, mainly for smaller personal computers.
THE NETWORKING CYCLE
Here the theme is communications -- specifically, the technology that makes it
possible, whether between machines or people. Our largest holding in the group
- -- as well as our largest foreign investment -- is Nokia, a Finnish
telecommunications equipment company. Nokia is well-placed to capitalize on the
infrastructure needs of the booming wireless communications industry. We added
Nokia shares steadily throughout the period, more than tripling the Fund's stake
as the share price rose more than 60%. Another company, cisco Systems Inc., a
closely-followed computer networking stock, rebounded sharply in 1995 after
falling out of favor last year. FTP Software makes a product designed to allow
computers to communicate with one another. Both because it competes in a crowded
field and because the market for its products has developed more slowly than
expected, FTP was among the Fund's few disappointments during the period.
OUTLOOK
We're cautiously optimistic as we begin the second half of 1995. Realistically,
it would be foolish to expect a repeat of the first half's performance and we
should expect the typical volatility we have seen in the past for these stocks.
Technology stocks have been climbing for a long time already, and they'd be
especially vulnerable if the economy slipped into recession. On the other hand,
despite sharp gains, technology stocks are not yet expensive by historical
standards. In fact, when measured by traditional valuation methods such as
price-to-earnings ratio, they're only in the middle of their range, suggesting
there may still be plenty of room before we hit the ceiling. Moreover, in
speaking with managers over the past few weeks,
- --------------------------------------------------------------------------------
(1) Figures from Lipper Analytical Services include reinvested dividends and do
not take into account sales charges. Actual load-adjusted performance is lower.
International investing involves special risks as detailed in the prospectus.
["We're cautiously optimistic as we begin the second half of 1995."]
5
<PAGE> 6
John Hancock Funds - Global Technology Fund
indications are that orders remain strong, despite slower growth in the U.S.
economy. Therefore, we expect the strong earnings growth to continue, which will
benefit domestic technology stocks. Meanwhile, as the current cycle of economic
growth expands in waves across the globe, we'll be looking for opportunities to
increase the Fund's foreign holdings, first in Europe and eventually in Japan.
6
<PAGE> 7
- --------------------------------------------------------------------------------
A LOOK AT PERFORMANCE
- --------------------------------------------------------------------------------
The tables on the right show the cumulative total returns and the average annual
total returns for John Hancock Global Technology Fund. Total return is a
performance measure that equals the sum of all income and capital gains
dividends, assuming reinvestment of these distributions, and the change in the
price of the fund's shares, expressed as a percentage of the fund's share.
Performance figures include the maximum applicable sales charge of 5% for Class
A shares. The effect of the maximum contingent deferred sales charge for Class B
shares (maximum 5% and declining to 0% over six years) is included in Class B
performance. Remember that all figures represent past performance and are no
guarantee of how the fund will perform in the future. Also, keep in mind that
the total return and share price of the Fund's investments will fluctuate. As a
result, your Fund's shares may be worth more or less than their original cost
depending on when you sell them.
Note: Participant-directed defined-contribution plans with at least 100 eligible
employees at inception of the Fund account may purchase Class A shares without
an initial sales charge as of March 15, 1995. If those shares are redeemed,
however, during the year following the calendar year end during which they were
purchased, a contingent deferred sales charge will be assessed.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURNS
- --------------------------------------------------------------------------------
FOR THE PERIOD ENDED JUNE 30, 1995
ONE FIVE MOST RECENT
YEAR YEARS(1) TEN YEARS(1)
---- -------- ------------
<S> <C> <C> <C>
Global Technology Fund: Class A(2) 55.72% 108.69% 230.97%
Global Technology Fund: Class B(2) 57.69% 47.84% N/A
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS
- --------------------------------------------------------------------------------
FOR THE PERIOD ENDED JUNE 30, 1995
ONE FIVE MOST RECENT
YEAR YEARS(1) TEN YEARS(1)
---- -------- ------------
<S> <C> <C> <C>
Global Technology Fund: Class A(2) 55.72% 15.85% 12.71%
Global Technology Fund: Class B(2) 57.69% 30.00% N/A
<FN>
NOTES TO PERFORMANCE
(1) Class B shares started on January 3, 1994.
(2) Performance is affected by a 12b-1 plan, which commenced on January 1, 1994
for both Class A shares and Class B shares. Different sales charge schedules
for Class A shares were in effect prior to March 1987 and are not reflected
in the above performance information.
</TABLE>
7
<PAGE> 8
- --------------------------------------------------------------------------------
WHAT HAPPENED TO A $10,000 INVESTMENT...
- --------------------------------------------------------------------------------
The charts on the right show how much a $10,000 investment in the John Hancock
Global Technology Fund would be worth on June 30, 1995, assuming you have been
invested since the day each class of shares started or for the most recent ten
years and have reinvested all distributions. For comparison, we've shown the
same $10,000 investment in the Standard & Poor's 500 Stock Index -- an unmanaged
index that includes 500 widely traded common stocks and is an often used measure
of stock market performance.
JOHN HANCOCK GLOBAL TECHNOLOGY FUND
CLASS A SHARES
[Line chart with the heading John Hancock Global Technology Fund: Class A,
representing the growth of a hypothetical $10,000 investment over the life of
the fund (or most recent 10 years). Within the chart are three lines.
The first line represents the value of the Standard & Poor's 500 Stock Index and
is equal to $39,246 as of June 30, 1995. The second line represents the value of
the hypothetical $10,000 investment made in the John Hancock Global Technology
Fund on June 30, 1985, before sales charge, and is equal to $34,845 as of June
30, 1995. The third line represents the John Hancock Global Technology Fund
after sales charge and is equal to $33,097 as of June 30, 1995.]
JOHN HANCOCK GLOBAL TECHNOLOGY FUND
CLASS B SHARES
[Line chart with the heading John Hancock Global Technology Fund: Class B,
representing the growth of a hypothetical $10,000 investment over the life of
the fund. Within the chart are three lines.
The first line represents the value of the hypothetical $10,000 investment made
in the John Hancock Global Technology Fund on January 3, 1994, before contingent
deferred sales charge, and is equal to $15,184 as of June 30, 1995. The second
line represents the John Hancock Global Technology Fund after contingent
deferred sales charge and is equal to $14,784 as of June 30, 1995. The third
line represents the value of the Standard & Poor's 500 Stock Index and is equal
to $12,176 as of June 30, 1995.]
Global Technology Fund
(not including maximum sales charge)
Global Technology Fund
(including maximum sales charge)
Standard & Poor's 500 Stock Index
8
<PAGE> 9
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
THE STATEMENT OF ASSETS AND LIABILITIES IS THE FUND'S BALANCE SHEET AND SHOWS
THE VALUE OF WHAT THE FUND OWNS, IS DUE AND OWES ON JUNE 30, 1995. YOU'LL ALSO
FIND THE NET ASSET VALUE PER SHARE AS OF THAT DATE.
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1995 (Unaudited)
- -------------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments at value - Note C:
Common stocks (cost - $51,150,902)............................ $ 83,001,690
Rights and warrants (cost - $69,000).......................... 103,750
Bonds (cost - $804,125)....................................... 1,354,250
Short-term investments (cost - $15,341,789)................... 15,341,789
------------
99,801,479
Receivable for shares sold...................................... 263,575
Receivable for investments sold................................. 2,001,312
Dividends receivable............................................ 20,973
Interest receivable............................................. 15,610
------------
Total Assets................................. 102,102,949
-----------------------------------------------------------
LIABILITIES:
Payable for shares repurchased.................................. 24,522
Payable for investments purchased............................... 3,036,250
Payable to John Hancock Advisers, Inc. and affiliates
- Note B........................................................ 131,799
Accounts payable and accrued expenses........................... 10,044
------------
Total Liabilities............................ 3,202,615
-----------------------------------------------------------
NET ASSETS:
Capital paid-in................................................. 62,247,691
Accumulated net realized gain on investments, options
and foreign currency transactions............................ 4,697,059
Net unrealized appreciation of investments 32,435,663
Accumulated net investment loss................................. (480,079)
------------
Net Assets................................... $ 98,900,334
===========================================================
NET ASSET VALUE PER SHARE:
(Based on net asset values and shares of beneficial interest
outstanding - 50 million shares authorized with $0.20 per
share par value, respectively)
Class A - $76,151,999/3,080,947................................. $ 24.72
===============================================================================
Class B - $22,748,335/932,167................................... $ 24.40
===============================================================================
MAXIMUM OFFERING PRICE PER SHARE*
Class A - ($24.72 x 105.26%).................................... $ 26.02
===============================================================================
<FN>
* On single retail sales of less than $50,000. On sales of $50,000 or more and
on group sales the offering price is reduced.
</TABLE>
THE STATEMENT OF OPERATIONS SUMMARIZES THE FUND'S INVESTMENT INCOME EARNED AND
EXPENSES INCURRED IN OPERATING THE FUND. IT ALSO SHOWS NET GAINS (LOSSES) FOR
THE PERIOD STATED.
<TABLE>
STATEMENT OF OPERATIONS
Six months ended June 30, 1995 (Unaudited)
- -------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Interest........................................................ $ 202,321
Dividends (net of foreign withholding taxes $4,367)............. 77,011
-----------
279,332
-----------
Expenses:
Investment management fee - Note B............................ 309,006
Transfer agent fee - Note B
Class A..................................................... 135,210
Class B..................................................... 35,082
Distribution/service fee - Note B
Class A..................................................... 89,531
Class B..................................................... 65,398
Administration fee - Note B................................... 45,560
Custodian fee................................................. 18,765
Registration and filing fees.................................. 18,736
Auditing fee.................................................. 16,218
Printing...................................................... 15,652
Directors' fees............................................... 6,292
Legal fees.................................................... 3,311
Miscellaneous................................................. 650
-----------
Total Expenses............................... 759,411
-----------------------------------------------------------
Net Investment Loss.......................... (480,079)
-----------------------------------------------------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investments sold........................... 4,697,059
Change in net unrealized appreciation/depreciation
of investments................................................ 20,825,057
-----------
Net Realized and Unrealized
Gain on Investments.......................... 25,522,116
-----------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations.................... $25,042,037
===========================================================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 10
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1995 DECEMBER 31,
(UNAUDITED) 1994
---------------- ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment loss.................................................................... $ (480,079) $ (682,853)
Net realized gain on investments sold and options...................................... 4,697,059 4,736,133
Change in net unrealized appreciation/depreciation of investments...................... 20,825,057 (78,528)
----------- ------------
Net Increase in Net Assets Resulting from Operations................................. 25,042,037 3,974,752
----------- ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Distributions from net realized gain on investments and options
Class A - (none and $1.2625 per share, respectively)................................. -- (3,443,707)
Class B ** - (none and $1.2625 per share, respectively).............................. -- (614,018)
----------- ------------
Total Distributuions to Shareholders................................................ -- (4,057,725)
----------- ------------
FROM FUND SHARE TRANSACTIONS -- NET*.................................................... 12,340,995 19,850,814
----------- ------------
NET ASSETS:
Beginning of period.................................................................... 61,517,302 41,749,461
----------- ------------
End of period (including accumulated net investment loss of ($480,079) and none,
respectively).......................................................................... $98,900,334 $61,517,302
=========== ===========
* ANALYSIS OF FUND SHARE TRANSACTIONS:
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1995
(UNAUDITED) YEAR ENDED DECEMBER 31, 1994
------------------------ -----------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold.......................................................... 1,455,278 $30,051,842 1,628,280 $ 29,997,844
Shares issued to shareholders in reinvestment of distributions....... -- -- 184,986 3,235,355
---------- ----------- ---------- ------------
1,455,278 30,051,842 1,813,266 33,233,199
Less shares repurchased.............................................. (1,299,815) (26,566,628) (1,279,970) (22,995,150)
---------- ------------ ---------- ------------
Net increase....................................................... 155,463 $ 3,485,214 533,296 $ 10,238,049
========== =========== ========== ============
CLASS B**
Shares sold.......................................................... 791,959 $16,742,876 563,553 $ 10,264,273
Shares issued to shareholders in reinvestment of distributions....... -- -- 33,535 581,498
---------- ----------- ---------- ------------
791,959 16,742,876 597,088 10,845,771
Less shares repurchased.............................................. (387,055) (7,887,095) (69,825) (1,233,006)
---------- ----------- ---------- ------------
Net increase....................................................... 404,904 $ 8,855,781 527,263 $ 9,612,765
========== =========== ========== ============
<FN>
**Class B shares commenced operations January 3, 1994.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 11
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
<TABLE>
FINANCIAL HIGHLIGHTS
Selected data for each share of beneficial interest outstanding throughout the
period indicated, investment returns, key ratios, and supplemental data are as
follows:
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
CLASS A JUNE 30, 1995 ------------------------------------------------------------
(UNAUDITED) 1994 1993 1992 1991+ 1990+
----------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period .......... $ 17.84 $ 17.45 $ 14.94 $ 15.60 $ 12.44 $ 16.93
-------- -------- -------- -------- -------- --------
Net Investment Income (Loss) .................. (0.11) (0.22)(a) (0.21) (0.15)(b) 0.05 (0.04)
Net Realized and Unrealized Gain (Loss) on
Investments, Options and Foreign Currency
Transactions ................................ 6.99 1.87 4.92 1.00 4.11 (3.09)
-------- -------- -------- -------- -------- --------
Total from Investment Operations ......... 6.88 1.65 4.71 0.85 4.16 (3.13)
-------- -------- -------- -------- -------- --------
Less Distributions:
Dividends from Net Investment Income .......... -- -- -- -- (0.04) --
Distributions from Net Realized Gain on
Investments Sold, Options and Foreign
Currency Transactions ....................... -- (1.26) (2.20) (1.51) (0.96) (1.36)
-------- -------- -------- -------- -------- --------
Total Distributions ...................... -- (1.26) (2.20) (1.51) (1.00) (1.36)
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ................ $ 24.72 $ 17.84 $ 17.45 $ 14.94 $ 15.60 $ 12.44
======== ======== ======== ======== ======== ========
Total Investment Return at Net Asset Value .... 38.57%(f) 9.62% 32.06% 5.70%(c) 33.05% (18.46%)
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted) ..... $76,152 $52,193 $41,749 $32,094 $31,580 $28,864
Ratio of Expenses to Average Net Assets ....... 1.94%* 2.16% 2.10% 2.05%(b) 2.32% 2.36%
Ratio of Net Investment Income (Loss) to
Average Net Assets ....................... (1.18%)* (1.25%) (1.49%) (0.88%)(b) 0.34% (0.28%)
Portfolio Turnover Rate ....................... 37% 67% 86% 76% 67% 38%
</TABLE>
THE FINANCIAL HIGHLIGHTS SUMMARIZES THE IMPACT OF THE FOLLOWING FACTORS ON A
SINGLE SHARE FOR THE PERIOD INDICATED: NET INVESTMENT INCOME, GAINS (LOSSES),
DIVIDENDS AND TOTAL INVESTMENT RETURN OF THE FUND. IT SHOWS HOW THE FUND'S NET
ASSET VALUE FOR A SHARE HAS CHANGED SINCE THE END OF THE PREVIOUS PERIOD.
ADDITIONALLY, IMPORTANT RELATIONSHIPS BETWEEN SOME ITEMS PRESENTED IN THE
FINANCIAL STATEMENTS ARE EXPRESSED IN RATIO FORM.
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 12
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
<TABLE>
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED PERIOD ENDED
JUNE 30, 1995 DECEMBER 31,
(UNAUDITED) 1994
----------- ------------
<S> <C> <C>
CLASS B(d)
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period.......................................................... $ 17.68 $17.24(e)
-------- ---------
Net Investment Loss........................................................................... (0.14) (0.35)(a)
Net Realized and Unrealized Gain on Investments and Options................................... 6.86 2.05
-------- ---------
Total from Investment Operations............................................................. 6.72 1.70
-------- ---------
Less Distributions:
Distributions from Net Realized Gain on Investments Sold and Options.......................... -- (1.26)
-------- ---------
Net Asset Value, End of Period................................................................ $ 24.40 $17.68
======== =========
Total Investment Return at Net Asset Value.................................................... 38.01%(f) 10.02%
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period (000's omitted)..................................................... $22,748 $9,324
Ratio of Expenses to Average Net Assets....................................................... 2.71%* 2.90%*
Ratio of Net Investment Loss to Average Net Assets............................................ (1.93%)* (1.98%)*
Portfolio Turnover Rate....................................................................... 37% 67%
<FN>
* On an annualized basis.
(a) On average month end shares outstanding.
(b) Reflects voluntary expense limitations in effect during the year ended
December 31, 1992 (see Note B to the Notes to the Financial Statements). As
a result of such limitations, expenses of the Fund for 1992 reflect
reductions of $0.03 per share. Absent such limitations, for 1992, the ratio
of expenses to average net assets would have been 2.22% and the ratio of net
investment income to average net assets would have been (1.05%).
(c) Without the reimbursement, total investment return would have been 5.53%.
(d) Class B shares commenced operations on January 3, 1994.
(e) Initial price to commence operations.
(f) Not annualized.
+ These periods are covered by the report of other independent accountants
(not included herein).
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 13
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
<TABLE>
SCHEDULE OF INVESTMENTS
June 30, 1995 (Unaudited)
- --------------------------------------------------------------------------------
THE SCHEDULE OF INVESTMENTS IS A COMPLETE LIST OF ALL SECURITIES OWNED BY GLOBAL
TECHNOLOGY FUND ON JUNE 30, 1995. IT'S DIVIDED INTO FOUR MAIN CATEGORIES: COMMON
STOCKS, RIGHTS AND WARRANTS, BONDS AND SHORT-TERM INVESTMENTS. THE STOCKS,
RIGHTS AND WARRANTS AND BONDS ARE FURTHER BROKEN DOWN BY INDUSTRY GROUPS. UNDER
EACH INDUSTRY GROUP IS A LIST OF THE SECURITIES OWNED BY THE FUND. SHORT-TERM
INVESTMENTS, WHICH REPRESENT THE FUND'S "CASH" POSITION, ARE LISTED LAST.
<CAPTION>
ISSUER, DESCRIPTION NUMBER OF SHARES MARKET VALUE
- ------------------- ---------------- ------------
<S> <C> <C>
COMMON STOCKS
BROADCASTING (1.92%)
Telewest Communications PLC, American
Depositary Receipt (ADR)
(United Kingdom)** ...................... 30,000 $ 772,500
Viacom, Inc. (Class B) .................... 24,246 1,124,408
------------
1,896,908
------------
COMPUTERS - MAINFRAME (2.43%)
International Business Machines Corp. ..... 25,000* 2,400,000
------------
COMPUTERS - MINI/MICRO (2.95%)
HDS Network Systems, Inc.** ............... 50,000* 257,810
Intergraph Corp.** ........................ 60,000* 667,500
Silicon Graphics, Inc.** .................. 50,000 1,993,750
------------
2,919,060
------------
COMPUTERS - PERIPHERAL (3.74%)
Adaptec, Inc.** ........................... 100,000 3,700,000
------------
COMPUTERS - SOFTWARE (20.54%)
Baan Co., N.V. (Netherlands)** ............ 5,000* 154,375
BMC Software, Inc.** ...................... 25,000 1,931,250
Cheyenne Software, Inc.** ................. 100,000 1,850,000
Computer Associates International, Inc. ... 50,000 3,387,500
Dendrite International, Inc.** ............ 2,500* 40,313
Eagle Point Software Corp.** .............. 20,000* 340,000
Electro Brain International Corp.** ....... 115,000 14,375
FTP Software, Inc.** ...................... 50,000 1,500,000
Inference Corp.** ......................... 20,000* 282,500
Informix Corp.** .......................... 100,000* 2,537,500
Oracle Systems Corp.** .................... 75,000 2,896,875
Parametric Technology Corp.** ............. 50,000 2,487,500
Platinum Technology, Inc.** ............... 75,000* 1,359,375
Renaissance Solutions, Inc.,** ............ 50,000* 687,500
Telebase Systems, Inc.** (r) .............. 217,360 141,284
TGV Software, Inc.** ...................... 25,000* 493,750
UUNET Technologies, Inc.** ................ 7,500* 206,250
------------
20,310,347
------------
ELECTRONICS (26.89%)
ADFlex Solutions, Inc.** .................. 100,000 2,450,000
Advanced Micro Devices, Inc.** ............ 30,000* 1,091,250
Applied Materials, Inc.** ................. 50,000 4,331,250
Integrated Device Technology, Inc.** ...... 90,000 4,162,500
Lam Research Corp.** ...................... 50,000 3,200,000
LSI Logic Corp.** ......................... 100,000 $ 3,912,500
Motorola, Inc. ............................ 20,000* 1,342,500
National Semiconductor Corp.** ............ 50,000* 1,387,500
Teradyne, Inc.** .......................... 50,000 3,268,750
Tower Semiconductor Ltd. (Israel)** ....... 50,000* 1,450,000
------------
26,596,250
------------
MACHINE-DIVERSIFIED (0.32%)
AG Associates, Inc.** ..................... 18,000* 315,000
------------
TELECOMMUNICATIONS (25.14%)
3Com Corp.** .............................. 40,000 2,680,000
Allen Group, Inc. ......................... 70,000 2,073,750
Bay Networks, Inc.** ...................... 50,000* 2,068,750
cisco Systems, Inc.** ..................... 60,000 3,033,750
DSC Communications Corp.** ................ 60,000 2,790,000
Empresas Telex-Chile, S.A. (ADR) (Chile) .. 50,000 675,000
General Instrument Corp.** ................ 50,000 1,918,750
Harmonic Lightwaves, Inc.** ............... 50,000* 837,500
Hong Kong Telecommunications, Ltd
(ADR) (Hong Kong) ....................... 25,000 496,875
Mobilemedia Corp.** ....................... 20,000* 410,000
Nera AS (ADR) (Norway)** .................. 30,000* 843,750
Nokia Corp. (ADR) (Finland) ............... 70,000 4,173,750
P-COM, Inc.** ............................. 29,500* 567,875
SSE Telecom, Inc.** ....................... 125,000 1,109,375
Telefonos de Mexico, S.A. de C.V ..........
(ADR) (Mexico) .......................... 40,000 1,185,000
------------
24,864,125
------------
TOTAL COMMON STOCKS
(Cost $51,150,902) .......... (83.93%) 83,001,690
-------- ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 14
FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
<TABLE>
<CAPTION>
NUMBER OF RIGHTS MARKET
ISSUER, DESCRIPTION OR WARRANTS VALUE
- ------------------- ---------------- ------
<S> <C> <C>
RIGHTS & WARRANTS
BROADCASTING (0.06%)
Viacom, Inc., Variable Common Rights** ..... 40,000 $ 60,000
--------
ELECTRONICS (0.04%)
Ibis Technology Corp., Warrants** .......... 70,000 43,750
--------
TOTAL RIGHTS & WARRANTS
(Cost $69,000) (0.10%) 103,750
------- --------
</TABLE>
<TABLE>
<CAPTION>
PAR VALUE
INTEREST S&P (000'S
RATE RATING*** OMITTED)
-------- --------- -----------
<S> <C> <C> <C> <C>
BONDS
ELECTRONICS (0.94%)
Kulicke & Soffa Industries, Inc.,
Conv Sub Deb, 03-01-08 ......... 8.000% B- $300 929,250
---------
TELECOMMUNICATIONS (0.43%)
Tele 2000
Conv Note, 04-14-97
(Peru) (R) ..................... 9.750 NR 500 425,000
---------
TOTAL BONDS
(Cost $804,125) (1.37%) 1,354,250
------ ---------
SHORT-TERM INVESTMENTS
JOINT REPURCHASE AGREEMENT (7.65%)
Investment in a joint repurchase
agreement transaction
with Lehman Brothers, Inc.,
Dated 06-30-95, Due 07-03-95,
(secured by U.S. Treasury Bill,
5.44972% due 12-28-95, and
U.S. Treasury Note, 6.875%
due 12-28-95) Note A ............. 6.180 7,571 7,571,000
-----------
SHORT-TERM NOTES (7.85%)
Federal Home Loan Bank.,
07-03-95 ......................... 6.000 2,760 2,760,000
Federal Home Loan
Mortgage Corp., 07-05-95 ......... 5.910 5,000 5,000,000
-----------
7,760,000
-----------
CORPORATE SAVINGS ACCOUNT (0.01%)
Investors Bank & Trust
Company Daily Interest
Savings Account Current
Rate 3.00% ....................... 10,789
-----------
TOTAL SHORT-TERM INVESTMENTS (15.51%) 15,341,789
------- -----------
TOTAL INVESTMENTS (100.91%) $99,801,479
======= ===========
<FN>
NOTES TO SCHEDULE OF INVESTMENTS
(R) This security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold, normally to qualified
institutional buyers, in transactions exempt from registration. See Note A
of the Notes to Financial Statements for valuation policy. Rule 144A
securities amounted to $425,000, as of June 30, 1995.
(r) Direct placement securities are restricted to resale. They have been valued
at fair value by the Trustees after considerations of restrictions as to
resale, financial condition and prospects of the issuer, general market
conditions and pertinent information in accordance with the Fund's By-Laws
and the Investment Company Act of 1940, as amended. The Fund has limited
rights to registration under the Securities Act of 1933 with respect to
these restricted securities.
</TABLE>
<TABLE>
Additional information on each restricted security is as follows:
<CAPTION>
MARKET
VALUE AS A
PERCENTAGE MARKET
ACQUISITION ACQUISITION OF FUND'S VALUE AT
SECURITY DATE COST NET ASSETS JUNE 30, 1995
- -------- ----------- ----------- ---------- -------------
<S> <C> <C> <C> <C>
Telebase Systems, Inc. -
Common Stock...... 11-14-91 $304,304 0.14% $141,284
<FN>
*Securities, other than short-term investments, newly added to the portfolio
during the period ended June 30, 1995.
**Non-income producing security.
***Credit ratings are unaudited.
</TABLE>
NR Not Rated by either Standard & Poor's or Moody's Investors Services.
Parenthetical disclosure of a foreign country in the security description
represents country of foreign issuer, however, security is U.S. dollar
denominated.
The percentage shown for each investment category is the total value of that
category as a percentage of the net assets of the Fund.
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE> 15
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
(UNAUDITED)
NOTE A --
ACCOUNTING POLICIES
John Hancock Technology Series, Inc. ( the "Company") is an open-end investment
company registered under the Investment Company Act of 1940. The Company
consists of two series: John Hancock Global Technology Fund (the "Fund"), a
diversified series, and John Hancock National Aviation & Technology Fund, a
non-diversified series. The shares of each class represent an interest in the
same portfolio of investments of the Fund and have equal rights to voting,
redemption, dividends and liquidation except that certain expenses, subject to
the approval of the Directors, may be applied differently to each class of
shares in accordance with current regulations of the Securities and Exchange
Commission and the Internal Revenue Service. Shareholders of a class which bears
distribution/service expenses under the terms of a distribution plan, have
exclusive voting rights to such distribution plan. Significant accounting
policies of the Fund are as follows:
VALUATION OF INVESTMENTS Securities in the Fund's portfolio are valued on the
basis of market quotations, valuations provided by independent pricing services
or, at fair value as determined in good faith in accordance with procedures
approved by the Trustees. Short-term debt investments maturing within 60 days
are valued at amortized cost which approximates market value.
JOINT REPURCHASE AGREEMENT Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the Fund, along with other registered
investment companies having a management contract with John Hancock Advisers,
Inc., (the "Adviser"), a wholly-owned subsidiary of The Berkeley Financial
Group, may participate in a joint repurchase agreement transaction. Aggregate
cash balances are invested in one or more repurchase agreements, whose
underlying securities are obligations of the U.S. government and/or its
agencies. The Fund's custodian bank receives delivery of the underlying
securities for the joint account on the Fund's behalf. The Adviser is
responsible for ensuring that the agreement is fully collateralized at all
times.
INVESTMENT TRANSACTIONS Investment transactions are recorded as of the date of
purchase, sale, or maturity. Net realized gains and losses on sales of
investments are determined on the identified cost basis.
FEDERAL INCOME TAXES The Fund's policy is to comply with the requirements of the
Internal Revenue Code that are applicable to regulated investment companies. It
will not be subject to Federal income tax on taxable earnings which are
distributed to shareholders.
DIVIDENDS, DISTRIBUTIONS AND INTEREST Dividend income on investment securities
is recorded on the ex-dividend date. Interest income on investment securities is
recorded on the accrual basis. Foreign income may be subject to foreign
withholding taxes which are accrued as applicable.
The Fund records all distributions to shareholders from net investment income
and realized gains on the ex-dividend date. Such distributions are determined in
conformity with income tax regulations, which may differ from generally accepted
accounting principles. Dividends paid by the Fund with respect to each class of
shares will be calculated in the same manner, at the same time and will be in
the same amount, except for the effect of expenses that may be applied
differently to each class as explained previously.
EXPENSES The majority of the expenses of the Company are directly identifiable
to an individual Fund. Expenses which are not readily identifiable to a specific
Fund are allocated in such a manner as deemed equitable, taking into
consideration, among other things, the nature and type of expense and the
relative size of the Funds.
CLASS ALLOCATIONS Income, common expenses and realized and unrealized gains
(losses) are determined at the Fund level and allocated daily to each class of
shares based on the appropriate net assets of the respective classes.
Distribution/service fees if any, are calculated daily at the class level based
on the appropriate net assets of each class and the specific expense rate(s)
applicable to each class.
OPTIONS Listed options are valued at the last quoted sales price on the exchange
on which they are primarily traded. Purchased put or call over-the-counter
options are valued at the average of the "bid" prices obtained from two
independent brokers. Written put or call over-the-counter options are valued at
the average of the "asked"
15
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
prices obtained from two independent brokers. Upon the writing of a call or put
option, an amount equal to the premium received by the Fund is included in the
Statement of Assets and Liabilities as an asset and corresponding liability. The
amount of the liability is subsequently marked-to-market to reflect the current
market value of the written option.
The Fund may use options contracts to manage its exposure to the stock
market. Writing puts and buying calls tend to increase the Fund's exposure to
the underlying instrument and buying puts and writing calls tend to decrease the
Fund's exposure to the underlying instrument, or hedge other Fund investments.
The maximum exposure to loss for any purchased options is limited to the
premium initially paid for the option. In all other cases, the face (or
"notional") amount of each contract at value reflects the maximum exposure of
the Fund in these contracts, but the actual exposure is limited to the change in
value of the contract over the period the contract remains open.
Risks may also arise if counterparties do not perform under the contracts'
terms, or if the Fund is unable to offset a contract with a counterparty on a
timely basis ("liquidity risk"). Exchange-traded options have minimal credit
risk as the exchanges act as counterparties to each transaction, and only
present liquidity risk in highly unusual market conditions. To minimize credit
and liquidity risks in over-the-counter option contracts, the Fund continuously
monitors the creditworthiness of all its counterparties.
At any particular time, except for purchased options, market or credit risk
may involve amounts in excess of those reflected in the Fund's period-end
Statement of Assets and Liabilities.
There were no written option transactions for the period ended June 30, 1995.
DISCOUNT ON SECURITIES The Fund accretes discount from par value on investment
securities from either the date of issue or date of purchase over the life of
the security, as required by the Internal Revenue Code.
NOTE B --
MANAGEMENT FEE, ADMINISTRATIVE
SERVICES AND TRANSACTIONS WITH AFFILIATES
AND OTHERS
The Adviser is responsible for managing the Fund's investment business affairs
and overseeing the investment activities of the sub-adviser. The Adviser has a
sub-investment management contract with American Fund Advisors, Inc. (the
"Sub-Adviser"), under which the Sub-Adviser, subject to the review of the
Directors and the overall supervision of the Adviser, provides the Fund with
investment services and advice with respect to investment transactions. Under
the present investment management contract, the Fund paid a monthly management
fee to the Adviser, equivalent on an annual basis, to the sum of (a) 1.00% of
the first $100,000,000 of the Fund's average daily net asset value and (b) 0.75%
of the Fund's average daily net asset value in excess of $100,000,000. Effective
January 1, 1995, the Adviser will waive a portion of the management fee
amounting to 0.15% of the average daily net asset value of the first
$100,000,000 of each series of the Fund. Therefore, the Fund will pay a monthly
management fee to the Adviser, equivalent on an annual basis to the sum of 0.85%
of the first $100,000,000 of the Fund's average daily net asset value. The
Adviser pays the Sub-Adviser a monthly management fee, equivalent on an annual
basis, to the sum of (a) 0.40% of the first $100,000,000 of the Fund's average
daily net asset value and (b) 0.40% of the investment advisory fee received by
the Adviser on amounts over $100,000,000. Effective January 1, 1995, the
Sub-Adviser will waive a portion of the management fee amounting to 0.05% of the
average daily net asset value of the first $100,000,000 of each series of the
Fund. Therefore, the Adviser will pay a monthly management fee to the
Sub-Adviser equivalent on an annual basis to the sum of 0.35% of the first
$100,000,000 of the Fund's average daily net asset value. The Fund pays a
monthly administrative fee at the rate of $100,000 per annum to the Adviser for
performance of administrative services to the Fund. In the event normal
operating expenses of the Fund, exclusive of certain expenses prescribed by
state law, are in excess of
16
<PAGE> 17
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
the most restrictive state limit where the Fund is registered to sell shares,
the fee payable to the Adviser will be reduced to the extent of such excess, and
the Adviser will make additional arrangements necessary to eliminate any
remaining excess expenses. The current limits are 2.5% of the first $30,000,000
of the Fund's average daily net asset value, 2.0% of the next $70,000,000, and
1.5% of the remaining average daily net asset value.
In the event that the ratio for 1992, 1993, or 1994 of normal operating
expenses of the Fund, exclusive of extraordinary expenses including, but not
limited to litigation, to the Fund's average daily net assets for such year,
exceeds the average expense ratio for the Fund for the three years ended
December 31, 1990 (restated as if the current annual rates for calculating the
management fee and the current expense limitations had been in effect throughout
the three year period), the fees payable to the Adviser will be reduced to the
extent required to eliminate such excess and the Adviser will make any
additional arrangements necessary to eliminate any remaining such excess. No
such reduction in fees was necessary under such arrangement for the period ended
June 30, 1995. At a shareholder meeting on December 8, 1993 the shareholders
approved a proposal which excludes the amounts payable by the Fund under the
Rule 12b-1 distribution plans (effective in January 1994) from the calculation
of the expense limit described above.
The Fund has a distribution agreement with John Hancock Funds, Inc. ("JH
Funds"), a wholly-owned subsidiary of the Adviser. For the period ended June 30,
1995, JH Funds received net sales charges of $143,539 with regard to sales of
Class A shares. Out of this amount, $21,142 was retained and used for printing
prospectuses, advertising, sales literature and other purposes, and $62,602 was
paid as sales commissions and first year service fees to unrelated
broker-dealers and $59,795 was paid as sales commissions and first year service
fees to sales person nel of John Hancock Distributors, Inc. ("Distributors"),
Tucker Anthony, Incorporated ("Tucker Anthony") and Sutro & Co., Inc.
("Sutro"), all of which are broker dealers. The Adviser's indirect parent,
John Hancock Mutual Life Insurance Company, is the indirect sole shareholder
of Distributors and John Hancock Freedom Securities Corporation and its
subsidiaries which include Tucker Anthony and Sutro.
Class B shares which are redeemed within six years of purchase are subject to
a contingent deferred sales charge ("CDSC") at declining rates beginning at 5.0%
of the lesser of the current market value at the time of redemption or the
original purchase cost of the shares being redeemed. Proceeds from the CDSC are
paid to JH Funds and are used in whole or in part to defray its expenses related
to providing distribution related services to the Fund in connection with the
sale of Class B shares. For the period ended June 30, 1995 contingent deferred
sales charges received by JH Funds amounted to $57,938.
In addition, to compensate JH Funds for the services it provides as
distributor of shares of the Fund, the Fund has adopted Distribution Plans with
respect to Class A and Class B pursuant to Rule 12b-1 under the Investment
Company Act of 1940. Accordingly, the Fund will make payments to JH Funds, for
distribution and service expenses at an annual rate not to exceed 0.30% of Class
A average daily net assets and 1.00% of Class B average daily net assets, to
reimburse JH Funds for its distribution and service costs. Up to a maximum of
0.25% of these payments may be service fees as defined by the amended Rules of
Fair Practice of the National Association of Securities Dealers. Under the
amended Rules of Fair Practice, curtailment of a portion of the Fund's 12b-1
payments could occur under certain circumstances.
The Fund has a transfer agent agreement with John Hancock Investor Services
Corporation ("Investor Services"), a wholly-owned subsidiary of The Berkeley
Financial Group. The Fund pays transfer agent fees based on the number of
shareholder accounts and certain out-of-pocket expenses.
Mr. Edward J. Boudreau, Jr. is a director and officer of the Adviser, and
Mr. Barry J. Gordon is a director and officer of the Sub-Adviser. Mr. Thomas
W.L. Cameron is an affiliated Director of the Fund. The compensation of
unaffiliated Directors is borne by the Fund. Effective with the fees paid for
1995, the unaffiliated Directors may elect to defer for tax purposes their
receipt of this compensation under the John Hancock Group of Funds Deferred
Compensation
17
<PAGE> 18
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Global Technology Fund
Plan. The Fund will make investments into other John Hancock funds, as
applicable, to cover its liability for the deferred compensation.
Investments to cover the Fund's deferred compensation liability will be recorded
on the Fund's books as an other asset. The deferred compensation liability will
be marked to market on a periodic basis and income earned by the investment will
be recorded on the Fund's books.
NOTE C --
INVESTMENT TRANSACTIONS
Purchases and proceeds from sales of securities, other than obligations of the
U.S. government and its agencies and short-term securities, during the period
ended June 30, 1995, aggregated $24,874,097 and $24,583,525, respectively. There
were no purchases or sales of obligations of the U.S. government and its
agencies during the period ended June 30, 1995.
The cost of investments owned at June 30, 1995 (excluding the corporate
savings account) for Federal income tax purposes was $67,355,027. Gross
unrealized appreciation and depreciation of investments aggregated $33,628,880
and $1,193,217, respectively, resulting in net unrealized appreciation of
$32,435,663.
NOTE D --
PLAN OF REORGANIZATION
On July 28, 1995, the shareholders of John Hancock National Aviation &
Technology Fund ("Aviation Fund") approved a plan of reorganization between the
Aviation Fund and the Fund providing for the transfer of substantially all of
the assets and liabilities of the Aviation Fund to the Fund in exchange solely
for Class A and Class B shares of the Fund to be distributed to Aviation Fund's
Class A and Class B shareholders, respectively.
18
<PAGE> 19
NOTES
John Hancock Funds - Global Technology Fund
19
<PAGE> 20
[LOGO] JOHN HANCOCK FUNDS Bulk Rate
A GLOBAL INVESTMENT MANAGEMENT FUND U.S. Postage
101 HUNTINGTON AVENUE BOSTON, MA 02199-7603 PAID
Brockton, MA
Permit No. 582
[A 1/2" x 1/2" John Hancock Funds logo in upper left hand corner of the page. A
box sectioned in quadrants with a triangle in upper left, a circle in upper
right, a cube in lower left and a diamond in lower right. A tag line below reads
"A Global Investment Management Firm."]
- --------------------------------------------------------------------------------
This report is for the information of shareholders of the John Hancock Global
Technology Fund. It may be used as sales literature when preceded or accompanied
by the current prospectus, which details charges, investment objectives and
operating policies.
[A recycled logo in lower left hand corner with caption "Printed on Recycled
Paper."]
JHD 830SA 6/95
