<PAGE>
[Logo] M F S (R)
INVESTMENT MANAGEMENT
We invented the mutual fund(R)
[Graphic Omitted]
MASSACHUSETTS
INVESTORS TRUST
ANNUAL REPORT o DECEMBER 31, 1999
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TABLE OF CONTENTS
Letter from the Chairman .................................................. 1
Management Review and Outlook ............................................. 4
Performance Summary ....................................................... 8
Portfolio of Investments .................................................. 12
Financial Statements ...................................................... 19
Notes to Financial Statements ............................................. 26
Independent Auditors' Report .............................................. 33
MFS' Year 2000 Readiness Disclosure ....................................... 35
Trustees and Officers ..................................................... 37
MFS ORIGINAL RESEARCH(R)
RESEARCH HAS BEEN CENTRAL TO INVESTMENT MANAGEMENT AT MFS
SINCE 1932, WHEN WE CREATED ONE OF THE FIRST IN-HOUSE
RESEARCH DEPARTMENTS IN THE MUTUAL FUND (SM)
INDUSTRY. ORIGINAL RESEARCH(SM) AT MFS IS MORE ORIGINAL RESEARCH
THAN JUST CRUNCHING NUMBERS AND CREATING
ECONOMIC MODELS: IT'S GETTING TO KNOW MFS
EACH SECURITY AND EACH COMPANY PERSONALLY.
MAKES A DIFFERENCE
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NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
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<PAGE>
LETTER FROM THE CHAIRMAN
[Photo of Jeffrey L. Shames]
Jeffrey L. Shames
Dear Shareholders,
One could easily argue that the Internet represents the greatest technological
development most of us may see in our lifetimes. There is no disputing that
this new communication medium is changing forever the way we work, play, and
shop. One might also argue that investing in this new technology represents
the investment opportunity of a lifetime. The question for any investor is
whether and how to take advantage of it.
The popular press, it seems, would have us believe that by surfing the Web, we
can learn everything we need to know about investing. Indeed, there is no
doubt that Internet-delivered information and brokerage services enable
individual investors to be well informed and to trade at bargain prices. But
we believe the numbers and facts argue that, for most of us, mutual funds
purchased through a financial consultant will continue to be one of the best
products for long-term investing in this new millennium.
According to a survey by the Investment Company Institute, the national
association of American investment companies, 44% of American households own
stock or bond mutual funds, while only 25.5% own individual stocks.(1) Of
course that doesn't tell us how well they did owning those funds or stocks,
but another statistic gives us a clue. In the third quarter of 1999, during a
period of volatility in the greatest bull market in history, a quarter of the
7,500 stocks tracked by Morningstar, a popular rating service, lost more than
20% of their value. But during the same period, less than 1% of the mutual
funds tracked by Morningstar -- 6 out of 10,000 funds -- were down by a
similar amount.(2) So an investor's chance of picking one of those losing
stocks was about 25 times greater than his or her chance of picking an equally
losing fund.
The numbers also show that a majority of Americans seek professional advice
when buying mutual funds. Outside of employer-sponsored retirement plans,
approximately 68% of fund shareholders state that their primary method of
purchasing shares is through a financial consultant.(1)
Why do we at MFS(R) believe that mutual funds plus professional advice will
continue to define the best course of action for many investors? Let's look at
some of the characteristics of a successful long-term investment approach:
o HAVING A PLAN AND STICKING TO IT: Our experience is that successful investors
-- those whose lives are enriched by the fruits of their investing -- share
two characteristics. They have a plan for reaching their monetary goals, and
they stick with that plan through up as well as down markets. And for many
investors, working with a financial consultant may be the best way to develop
a plan. Although the Internet abounds with calculators for developing all
sorts of investment plans, none has your financial consultant's high level of
experience and an understanding of your unique situation. And no calculator
can counsel you during a down market, when you may be tempted to abandon your
goals and your plan.
o DIVERSIFICATION: Few investors can afford to own a large number of holdings,
so poor performance of one company can potentially drag down their entire
portfolio. This is especially true when investing in volatile new areas such
as the Internet. On the other hand, a diversified mutual fund that owns dozens
or even hundreds of holdings is better positioned to survive a disappointment
in one or several investments.
o GOOD IN A DOWN MARKET: As we enter the tenth year of the greatest bull market
in history, it's easy to forget that market downturns are an almost inevitable
part of investing. Few mutual funds, of course, are going to be up when the
overall market is down. But as the numbers above from the third quarter of
1999 demonstrate, mutual funds may be less likely to suffer the extreme
downturns experienced by a large number of individual holdings when the market
heads south.
o MFS ORIGINAL RESEARCH(R): The Internet is one of the greatest research tools
ever invented, but it's still not the same as being eyeball to eyeball with
the management of a company and discussing their plans for their firm's
future.
o GOOD PERFORMANCE AT AN ACCEPTABLE LEVEL OF RISK: Investing in individual
stocks or bonds does indeed offer the potential of exhilarating performance
that few mutual funds even attempt. The downside is that the most exciting
investments are also likely to be the ones that give you sleepless nights. The
diversification and professional management of mutual funds help make them
inherently less risky than individual stock picking, and funds are available
in a wide range of risk profiles.
We believe that now, more than ever, mutual funds sold by an investment
professional may offer many investors the best way to participate in whatever
investment opportunities the new millennium may bring. The combination of
professional portfolio management and professional advice recognizes the key
reason that investors give us their money: because they don't want to make a
hobby or a second profession out of investing; they simply want their money to
work for them so they have a better likelihood of realizing their dreams.
As always, we appreciate your confidence in MFS and welcome any questions or
comments you may have.
Respectfully,
/s/ Jeffrey L. Shames
Jeffrey L. Shames
Chairman and Chief Executive Officer
MFS Investment Management(R)
January 15, 2000
(1) Source: Investment Company Institute.
(2) Source: Morningstar CEO Don Phillips' keynote address at The Baltimore Sun's
Dollars and Sense Conference, 10/99. In the period 7/1/99 through 9/ 30/99,
of the 7,500 stocks tracked by Morningstar, 1,865 lost 20% or more; of the
10,000 mutual funds tracked by Morningstar, six lost 20% or more. Mutual
fund results are at net asset value; if sales charges had been reflected,
results would have been lower.
Investments in mutual funds will fluctuate and may be worth more or less upon
redemption.
The opinions expressed in this letter are those of Jeffrey L. Shames, and no
forecasts can be guaranteed.
<PAGE>
MANAGEMENT REVIEW AND OUTLOOK
For the 12 months ended December 31, 1999, Class A shares of the Trust
provided a total return of 6.96%, Class B shares 6.28%, Class C shares 6.27%,
and Class I shares 7.38%. Class J shares commenced investment operations on
December 31, 1999. These returns include the reinvestment of any distributions
but exclude the effects of any sales charges. During the same period, the
average growth and income fund tracked by Lipper Analytical Services, Inc., an
independent firm that reports mutual fund performance, returned 13.78%. The
Trust's returns also compare to a 21.04% return for the Standard & Poor's 500
Composite Index (the S&P 500). The S&P 500 is a popular, unmanaged index of
common stock total return performance.
Q. IT HAS BEEN A DIFFICULT MARKET ENVIRONMENT FOR THE TRUST'S MORE
CONSERVATIVE VALUE-ORIENTED INVESTMENT APPROACH RELATIVE TO THE S&P 500.
CAN YOU PROVIDE SOME ADDITIONAL DETAILS REGARDING THE TRUST'S
UNDERPERFORMANCE VERSUS THE INDEX?
A. The Trust lagged the index primarily due to its underweighting in technology
stocks, which drove the narrow strength of the market. If we look at the
performance of the S&P 500, the top 25 performers in technology and
telecommunications stocks accounted for a majority of the total return of
the index over the past year. In an extremely narrow momentum-focused market
like we've experienced during the period, it is very difficult for a
diversified growth and income portfolio with a lower risk profile than its
index to outperform its benchmark over the short term. Also worth mentioning
is the fact that the average yield on the S&P 500 is at a historic low. In
the January 4, 2000, edition of The New York Times, a front page article
noted "for the first time in recent history -- and probably the first time
since the depression -- a quarter of the value of the S&P 500 came from
companies that do not pay dividends. Twenty years ago, only 2% of the value
of the index came from such companies." Today, companies paying and even
increasing dividends haven't been able to keep pace with stock returns. A
good example of this is General Electric. Although management has raised the
dividend in each of the last three years, the yield on that stock has gone
from 2.10% as of the end of 1996 to almost half that, or 1.06%, at the end
of 1999 as a result of the appreciation in its share price.
Q. YOU HAVE INCREASED THE TRUST'S WEIGHTING IN TECHNOLOGY STOCKS DURING THE
PERIOD. WHAT WAS THE REASON FOR THE CHANGE?
A. The Trust remained underweighted in technology stocks at about 24% of its
net assets versus the S&P 500, which had approximately 27% of its holdings
in technology at the end of the period. While we increased the Trust's
exposure to technology stocks during the period, we did not abandon our
focus on blue-chip companies with strong, long-term fundamentals and
reasonable valuations. We decided it was prudent to gradually increase the
Series' weighting in technology and telecommuni- cations relative to the
index, while at the same time keeping a close eye on valuations and the
fundamental business outlooks for these companies.
Some of the technology names that met our investment criteria and provided a
strong boost to performance were companies such as Intel, Oracle, Cisco, and
Motorola. In telecommunications, the Trust benefited from a major position
in Mannesmann, the German wireless telecommunication provider. Sprint, Bell
Atlantic, and Nippon Telephone & Telegraph also produced strong results due
to the huge growth in Internet usage and demand for data and voice services.
These are companies with solid track records that we could actually do
balance sheet and income statement analysis on, and they proved to have
attractive long-term business models.
Q. WHAT OTHER INDUSTRIES AND HOLDINGS WORKED OUT WELL FOR THE TRUST?
A. In addition to increasing our holdings in blue-chip technology names that
display attractive long-term business opportunities relative to their
valuations, we've been working on other ways to take advantage of Internet
mania while minimizing the Trust's exposure to the risks and volatility of
traditional "dot.com" companies. We were able to capitalize on the rapid
acceleration of advertising spending by Internet companies through our media
holdings such as Tribune, the New York Times, and General Electric, which
owns NBC.
While investors remained focused on technology and telecommunications
stocks, the Trust managed to locate strong performers from a wide range of
industries, including energy, industrial goods & services, consumer staples,
retailing, and financial services. Stocks such as BP Amoco, United
Technologies, Procter & Gamble, Wal-Mart, and American International Group
produced solid gains for the Trust. The success of these stocks and the
broadly diversified structure of the Trust highlights precisely what the
portfolio is trying to accomplish -- to provide growth of capital, with less
risk or price volatility than the S&P 500 Index.
Q. WHICH STOCKS DETRACTED FROM PERFORMANCE?
A. On the negative side, there were a few holdings that detracted from the
Trust's relative performance including, Kroger, Safeway, Service Corp., and
Xerox. Although supermarket operators Kroger and Safeway struggled in this
narrow market, we maintained our positions because we believe these
companies possess strong business prospects and favorable growth and
earnings outlooks. We sold off our positions in Service Corp. and Xerox
because the long-term outlooks for these companies deteriorated. Service
Corp. looked like it had the potential to continue its run of accelerating
growth, but it ran into financial problems due to its rapid expansion and
the holding hurt performance. Xerox looked like a classic turnaround story,
but as competition increased, its business plan stumbled and investors ran
for the exits.
Q. WHAT'S YOUR OUTLOOK FOR THE TRUST?
A. Looking forward, we'll continue to look for opportunities in areas such as
pharmaceutical companies, and drugstore operators such as CVS, which we feel
have been beaten down unreasonably due to concerns over Medicare reform and
potential government price controls. While the risks remain high in this
area during an election year, many pharmaceutical companies and drugstore
chains demonstrate promising long-term growth prospects, reliable cash flow
and valuations are becoming compelling.
Although it was a difficult period for the Trust, our well-balanced exposure
to market leaders in technology, telecommunications, financial services,
retailing, and industrial goods provides favorable growth prospects with
lower risk relative to the overall market. If market strength continues to
broaden as we anticipate, we believe the portfolio is well positioned to
take advantage of this environment.
/s/ Mitchell D. Dynan /s/ John D. Laupheimer, Jr.
Mitchell D. Dynan John D. Laupheimer, Jr.
Portfolio Manager Portfolio Manager
The opinions expressed in this report are those of the portfolio managers and
are only through the end of the period of the report as stated on the cover.
The managers' views are subject to change at any time based on market and
other conditions, and no forecasts can be guaranteed.
<PAGE>
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PORTFOLIO MANAGERS' PROFILES
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MITCHELL D. DYNAN IS SENIOR VICE PRESIDENT OF MFS INVESTMENT MANAGEMENT(R)
AND PORTFOLIO MANAGER OF MFS(R) UNION STANDARD(R) EQUITY FUND. HE IS ALSO A
PORTFOLIO MANAGER OF MASSACHUSETTS INVESTORS TRUST, AMERICA'S OLDEST MUTUAL
FUND, AND THE MASSACHUSETTS INVESTORS TRUST SERIES OFFERED THROUGH MFS(R)/SUN
LIFE ANNUITY PRODUCTS. HE JOINED MFS IN 1986 AS A RESEARCH ANALYST AND WAS
NAMED ASSISTANT VICE PRESIDENT IN 1987, VICE PRESIDENT IN 1988, PORTFOLIO
MANAGER IN 1995, AND SENIOR VICE PRESIDENT IN 1999. FROM 1983 TO 1986, MR.
DYNAN WORKED AS A SECURITIES ANALYST ON WALL STREET. HE STARTED HIS CAREER AS
A BANK LENDING OFFICER IN 1979. A GRADUATE OF TUFTS UNIVERSITY, HE IS A
MEMBER OF THE BOSTON SECURITY ANALYSTS SOCIETY, INC., AND IS A CHARTERED
FINANCIAL ANALYST.
JOHN D. LAUPHEIMER, JR., IS SENIOR VICE PRESIDENT AND DIRECTOR OF EQUITY
RESEARCH OF MFS INVESTMENT MANAGEMENT(R). HE IS ALSO LEAD PORTFOLIO
MANAGER OF MASSACHUSETTS INVESTORS TRUST, AMERICA'S OLDEST MUTUAL FUND.
HE ALSO MANAGES MFS(R) INSTITUTIONAL CORE EQUITY FUND, THE MASSACHUSETTS
INVESTORS TRUST SERIES OFFERED THROUGH MFS(R)/SUN LIFE ANNUITY PRODUCTS,
AND MFS(R) GROWTH WITH INCOME SERIES (PART OF MFS(R) VARIABLE INSURANCE
TRUST(SM)). MR. LAUPHEIMER JOINED THE MFS RESEARCH DEPARTMENT IN 1981 AS
A RESEARCH ANALYST. HE WAS NAMED INVESTMENT OFFICER IN 1983, ASSISTANT
VICE PRESIDENT IN 1984, VICE PRESIDENT IN 1986, PORTFOLIO MANAGER IN
1987, SENIOR VICE PRESIDENT IN 1995, AND DIRECTOR OF EQUITY RESEARCH IN
1999. MR. LAUPHEIMER IS A GRADUATE OF BOSTON UNIVERSITY AND THE SLOAN
SCHOOL OF MANAGEMENT OF MASSACHUSETTS INSTITUTE OF TECHNOLOGY. HE IS A
CHARTERED FINANCIAL ANALYST AND A MEMBER OF THE BOSTON SECURITY ANALYSTS
SOCIETY, INC.
ALL EQUITY PORTFOLIO MANAGERS BEGAN THEIR CAREERS AT MFS INVESTMENT
MANAGEMENT(R) AS RESEARCH ANALYSTS. OUR PORTFOLIO MANAGERS ARE SUPPORTED BY
AN INVESTMENT STAFF OF OVER 100 PROFESSIONALS UTILIZING MFS ORIGINAL
RESEARCH(R), A GLOBAL, COMPANY-ORIENTED, BOTTOM-UP PROCESS OF SELECTING
SECURITIES.
This report is prepared for the general information of shareholders. It is
authorized for distribution to prospective investors only when preceded or
accompanied by a current prospectus. A prospectus containing more information,
including the exchange privilege and all charges and expenses, for any other
MFS product is available from your financial consultant, or by calling MFS at
1-800-225-2606. Please read it carefully before investing or sending money.
<PAGE>
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FUND FACTS
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OBJECTIVE: SEEKS REASONABLE CURRENT INCOME AND LONG-TERM GROWTH
OF INCOME AND CAPITAL.
COMMENCEMENT OF
INVESTMENT OPERATIONS: JULY 15, 1924
CLASS INCEPTION: CLASS A JULY 15, 1924
CLASS B SEPTEMBER 7, 1993
CLASS C JULY 1, 1996
CLASS I JANUARY 2, 1997
CLASS J DECEMBER 31, 1999
SIZE: $15.6 BILLION NET ASSETS AS OF DECEMBER 31, 1999
PERFORMANCE SUMMARY
The following information illustrates the historical performance of the Fund's
original share class in comparison to various market indicators. Performance
results include the deduction of the maximum applicable sales charge and
reflect the percentage change in net asset value, including reinvestment of
dividends. Benchmark comparisons are unmanaged and do not reflect any fees or
expenses. The performance of other share classes will be greater than or less
than the line shown. (See Notes to Performance Summary.) It is not possible to
invest directly in an index.
GROWTH OF A HYPOTHETICAL $10,000 INVESTMENT
(For the 10-year period ended December 31, 1999)
Massachusetts S&P 500
Investors Trust Composite
-- Class A Index
-----------------------------------------------
12/89 $ 9,425 $10,000
12/91 12,021 12,642
12/93 14,203 14,976
12/95 19,589 20,876
12/97 32,479 34,232
12/99 42,710 53,278
AVERAGE ANNUAL AND CUMULATIVE TOTAL RATES OF RETURN THROUGH DECEMBER 31, 1999
<TABLE>
<CAPTION>
CLASS A
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge + 6.96% +73.18% +203.81% +353.16%
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Average Annual Total Return Excluding Sales Charge + 6.96% +20.09% + 24.89% + 16.31%
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Average Annual Total Return Including Sales Charge + 0.81% +17.74% + 23.42% + 15.63%
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<CAPTION>
CLASS B
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge + 6.28% +69.76% +193.05% +332.12%
- -------------------------------------------------------------------------------------------------------
Average Annual Total Return Excluding Sales Charge + 6.28% +19.29% + 23.99% + 15.76%
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Average Annual Total Return Including Sales Charge + 2.28% +18.59% + 23.82% + 15.76%
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<CAPTION>
CLASS C
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge + 6.27% +69.69% +196.83% +342.75%
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Average Annual Total Return Excluding Sales Charge + 6.27% +19.27% + 24.31% + 16.04%
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Average Annual Total Return Including Sales Charge + 5.27% +19.27% + 24.31% + 16.04%
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<CAPTION>
CLASS I
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
Cumulative Total Return Excluding Sales Charge + 7.38% +75.04% +207.08% +358.04%
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Average Annual Total Return Excluding Sales Charge + 7.38% +20.52% + 25.16% + 16.44%
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<CAPTION>
COMPARATIVE INDICES(+)
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
Average growth and income fund+ +13.78% +17.96% + 21.34% + 14.42%
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Standard & Poor's 500 Composite Index# +21.04% +27.56% + 28.56% + 18.21%
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(+) Average annual rates of return.
+ Source: Lipper Analytical Services, Inc.
# Source: Standard & Poor's Micropal, Inc.
</TABLE>
<PAGE>
NOTES TO PERFORMANCE SUMMARY
Class A Share Performance Including Sales Charge takes into account the
deduction of the maximum 5.75% sales charge. Class B Share Performance
Including Sales Charge takes into account the deduction of the applicable
contingent deferred sales charge (CDSC), which declines over six years from 4%
to 0%. Class C Share Performance Including Sales Charge takes into account the
deduction of the 1% CDSC applicable to Class C shares redeemed within 12
months. Class I shares have no sales charge and are only available to certain
institutional investors.
Class B, C, and I share performance include the performance of the Fund's
Class A shares for periods prior to their inception (blended performance).
Class B and C blended performance has been adjusted to take into account the
CDSC applicable to Class B and C shares rather than the initial sales charge
(load) applicable to Class A shares. Class I share blended performance has
been adjusted to account for the fact that Class I shares have no sales
charge. These blended performance figures have not been adjusted to take into
account differences in class-specific operating expenses. Because operating
expenses of Class B and C shares are higher than those of Class A, the blended
Class B and C share performance is higher than it would have been had Class B
and C shares been offered for the entire period. Conversely, because operating
expenses of Class I shares are lower than those of Class A, the blended Class
I share performance is lower than it would have been had Class I shares been
offered for the entire period.
All performance results reflect any applicable expense subsidies and waivers,
without which the results would have been less favorable. Subsidies and
waivers may be rescinded at any time. See the prospectus for details. All
results are historical and assume the reinvestment of capital gains.
INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, AND SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. PAST PERFORMANCE
IS NO GUARANTEE OF FUTURE RESULTS. MORE RECENT RETURNS MAY BE MORE OR LESS
THAN THOSE SHOWN.
<PAGE>
PORTFOLIO CONCENTRATION AS OF DECEMBER 31, 1999
FIVE LARGEST STOCK SECTORS
TECHNOLOGY 23.9%
UTILITIES & COMMUNICATIONS 13.6%
FINANCIAL SERVICES 13.5%
INDUSTRIAL GOODS & SERVICES 9.3%
RETAILING 8.3%
TOP 10 STOCK HOLDINGS
MICROSOFT CORP. 4.8% UNITED TECHNOLOGIES CORP. 2.2%
U.S. computer software and systems U.S. aerospace, defense, and building
company equipment company
GENERAL ELECTRIC CO. 4.3% CISCO SYSTEMS, INC. 2.1%
U.S. diversified manufacturing and U.S. computer network developer
financial services conglomerate
MOTOROLA, INC. 1.9%
EXXONMOBIL CORP. 2.5% U.S. wireless communications company
International oil and gas company
BELL ATLANTIC CORP. 1.9%
INTEL CORP. 2.4% U.S. integrated telecommunications company
U.S. semiconductor manufacturer
BP AMOCO PLC 1.8%
WAL-MART STORES, INC. 2.2% British oil and petrochemical company
U.S. retail chain
The portfolio is actively managed, and current holdings may be different.
<PAGE>
PORTFOLIO OF INVESTMENTS -- December 31, 1999
<TABLE>
<CAPTION>
Stocks - 97.1%
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ISSUER SHARES VALUE
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<S> <C> <C>
U.S. Stocks - 89.2%
Aerospace - 3.8%
Boeing Co. 601,900 $ 25,016,469
General Dynamics Corp. 1,717,900 90,619,225
Honeywell International, Inc. 1,705,600 98,391,800
TRW, Inc. 944,500 49,054,968
United Technologies Corp. 5,026,900 326,748,500
---------------
$ 589,830,962
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Automotive - 0.5%
Federal-Mogul Corp. 569,800 $ 11,467,225
Ford Motor Co. 1,136,700 60,742,406
---------------
$ 72,209,631
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Banks and Credit Companies - 4.7%
Bank America Corp. 2,128,100 $ 106,804,019
Bank One Corp. 1,974,100 63,294,581
Capital One Financial Corp. 490,000 23,611,875
Chase Manhattan Corp. 305,000 23,694,688
Comerica, Inc. 542,150 25,311,628
Northern Trust Corp. 2,434,200 129,012,600
Providian Financial Corp. 548,600 49,956,887
U.S. Bancorp 4,438,300 105,687,019
Wells Fargo Co. 4,863,900 196,683,956
---------------
$ 724,057,253
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Biotechnology - 0.4%
Guidant Corp.* 1,474,400 $ 69,296,800
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Business Machines - 3.9%
Hewlett-Packard Co. 1,986,400 $ 226,325,450
International Business Machines Corp. 1,944,300 209,984,400
Sun Microsystems, Inc.* 2,288,000 177,177,000
---------------
$ 613,486,850
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Business Services - 2.2%
Computer Sciences Corp.* 1,269,000 $ 120,079,125
DST Systems, Inc.* 715,400 54,593,963
First Data Corp. 2,969,400 146,428,537
United Parcel Service, Inc. 351,220 24,234,180
---------------
$ 345,335,805
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Cellular Telephones - 0.5%
Sprint Corp. (PCS Group)* 798,050 $ 81,800,125
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Chemicals - 0.5%
Dow Chemical Co. 200,300 $ 26,765,088
E.I. du Pont de Nemours & Co., Inc. 397,400 26,178,725
Rohm & Haas Co. 700,000 28,481,250
---------------
$ 81,425,063
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Computer Hardware - Systems - 0.1%
Dell Computer Corp.* 260,000 $ 13,260,000
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Computer Software - Personal Computers - 4.7%
Microsoft Corp.* 6,201,200 $ 723,990,100
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Computer Software - Systems - 2.8%
BMC Software, Inc.* 646,600 $ 51,687,588
Computer Associates International, Inc. 2,644,700 184,963,706
Oracle Corp.* 1,777,650 199,207,903
---------------
$ 435,859,197
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Conglomerates - 0.9%
Tyco International Ltd. 3,411,300 $ 132,614,287
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Consumer Goods and Services - 3.1%
Cintas Corp. 955,000 $ 50,734,375
Clorox Co. 944,680 47,588,255
Colgate-Palmolive Co. 1,810,200 117,663,000
Gillette Co. 553,100 22,780,806
Procter & Gamble Co. 2,154,400 236,041,450
---------------
$ 474,807,886
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Electrical Equipment - 4.8%
Emerson Electric Co. 1,639,800 $ 94,083,525
General Electric Co. 4,174,600 646,019,350
---------------
$ 740,102,875
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Electronics - 2.4%
Agilent Technologies, Inc.* 156,830 $ 12,124,919
Intel Corp. 4,443,400 365,747,363
---------------
$ 377,872,282
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Entertainment - 1.8%
Carnival Corp. 583,400 $ 27,893,812
Infinity Broadcasting Corp.* 1,238,100 44,803,744
Time Warner, Inc. 2,794,400 202,419,350
---------------
$ 275,116,906
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Financial Institutions - 3.1%
American Express Co. 503,500 $ 83,706,875
Associates First Capital Corp., "A" 749,316 20,559,358
Citigroup, Inc. 1,837,600 102,101,650
Federal Home Loan Mortgage Corp. 2,458,800 115,717,275
State Street Corp. 2,147,700 156,916,331
---------------
$ 479,001,489
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Financial Services - 0.3%
AXA Financial, Inc. 1,502,600 $ 50,900,575
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Food and Beverage Products - 2.2%
Anheuser-Busch Cos., Inc. 1,891,000 $ 134,024,625
Bestfoods Co. 851,500 44,756,969
Coca-Cola Co. 217,900 12,692,675
Nabisco Holdings Corp., "A" 1,176,300 37,200,488
PepsiCo., Inc. 573,500 20,215,875
Quaker Oats Co. 1,525,900 100,137,187
---------------
$ 349,027,819
- --------------------------------------------------------------------------------------------------------
Forest and Paper Products - 0.2%
Weyerhaeuser Co. 410,000 $ 29,443,125
- --------------------------------------------------------------------------------------------------------
Insurance - 4.4%
American International Group, Inc. 1,411,125 $ 152,577,890
CIGNA Corp. 1,255,500 101,146,219
Hartford Financial Services Group, Inc. 4,327,600 205,020,050
Lincoln National Corp. 2,537,000 101,480,000
Marsh & McLennan Cos., Inc. 741,400 70,942,712
MBIA, Inc. 599,740 31,673,769
Torchmark Corp. 909,900 26,443,969
---------------
$ 689,284,609
- --------------------------------------------------------------------------------------------------------
Machinery - 0.7%
Deere & Co., Inc. 1,245,800 $ 54,036,575
Ingersoll Rand Co. 525,200 28,918,825
W.W. Grainger, Inc. 525,000 25,101,563
---------------
$ 108,056,963
- --------------------------------------------------------------------------------------------------------
Medical and Health Products - 4.7%
American Home Products Corp. 2,017,400 $ 79,561,212
Bausch & Lomb, Inc. 784,900 53,716,594
Bristol-Myers Squibb Co. 2,649,300 170,051,944
Johnson & Johnson Co. 735,200 68,465,500
Pfizer, Inc. 4,343,600 140,895,525
Pharmacia & Upjohn, Inc. 2,610,170 117,457,650
Schering Plough Corp. 1,203,460 50,770,969
Warner-Lambert Co. 649,600 53,226,600
---------------
$ 734,145,994
- --------------------------------------------------------------------------------------------------------
Medical and Health Technology and Services - 1.8%
Medtronic, Inc. 5,551,264 $ 202,274,182
United Healthcare Corp. 1,610,600 85,563,125
---------------
$ 287,837,307
- --------------------------------------------------------------------------------------------------------
Metals and Minerals
Alcoa, Inc. 54,400 $ 4,515,200
- --------------------------------------------------------------------------------------------------------
Oil Services - 0.2%
Halliburton Co. 650,000 $ 26,162,500
- --------------------------------------------------------------------------------------------------------
Oils - 4.1%
Chevron Corp. 567,600 $ 49,168,350
Coastal Corp. 1,768,700 62,678,306
Conoco, Inc. 3,891,600 96,803,550
ExxonMobil Corp. 4,720,268 380,276,591
Unocal Corp. 1,327,800 44,564,287
---------------
$ 633,491,084
- --------------------------------------------------------------------------------------------------------
Printing and Publishing - 3.6%
Gannett Co., Inc. 2,119,900 $ 172,904,344
New York Times Co. 3,024,500 148,578,563
Tribune Co. 4,396,200 242,065,762
---------------
$ 563,548,669
- --------------------------------------------------------------------------------------------------------
Restaurants and Lodging - 0.6%
McDonald's Corp. 2,154,800 $ 86,865,375
- --------------------------------------------------------------------------------------------------------
Special Products and Services - 0.2%
Illinois Tool Works, Inc. 380,600 $ 25,714,288
- --------------------------------------------------------------------------------------------------------
Stores - 5.5%
Costco Wholesale Corp.* 255,000 $ 23,268,750
CVS Corp. 3,231,300 129,050,044
Dayton Hudson Corp. 1,952,400 143,379,375
Home Depot, Inc. 1,756,650 120,440,316
Lowe's Cos., Inc. 490,000 29,277,500
TJX Cos., Inc. 3,944,200 80,609,587
Wal-Mart Stores, Inc. 4,820,800 333,237,800
---------------
$ 859,263,372
- --------------------------------------------------------------------------------------------------------
Supermarkets - 2.4%
Kroger Co.* 8,171,900 $ 154,244,613
Safeway, Inc.* 6,119,800 217,635,387
---------------
$ 371,880,000
- --------------------------------------------------------------------------------------------------------
Technology - 0.4%
National Semiconductor Corp.* 1,524,100 $ 65,250,531
- --------------------------------------------------------------------------------------------------------
Telecommunications - 14.6%
Alltel Corp. 923,300 $ 76,345,369
AT&T Corp. 1,811,600 91,938,700
Bell Atlantic Corp. 4,609,800 283,790,812
BroadWing, Inc. 1,756,700 64,778,313
Cisco Systems, Inc.* 2,990,100 320,314,462
Corning, Inc. 1,727,000 222,675,063
General Instrument Corp.* 646,600 54,961,000
Lucent Technologies, Inc. 1,822,100 136,315,856
MCI WorldCom, Inc.* 3,789,366 201,073,233
Motorola, Inc. 1,986,000 292,438,500
Nortel Networks Corp. 1,851,000 186,951,000
SBC Communications, Inc. 4,345,549 211,845,514
Sprint Corp. 2,032,700 136,826,119
---------------
$ 2,280,253,941
- --------------------------------------------------------------------------------------------------------
Utilities - Electric - 2.6%
CMS Energy Corp. 1,333,400 $ 41,585,412
Duke Energy Corp. 1,385,700 69,458,212
FirstEnergy Corp. 1,400,200 31,767,038
NiSource, Inc. 1,750,500 31,290,188
Peco Energy Co. 2,645,700 91,938,075
Pinnacle West Capital Corp. 711,200 21,736,050
Texas Utilities Co. 2,687,700 95,581,331
Unicom Corp. 617,800 20,696,300
---------------
$ 404,052,606
- --------------------------------------------------------------------------------------------------------
Utilities - Gas - 0.3%
Enron Corp. 634,300 $ 28,147,063
Williams Cos., Inc. 760,100 23,230,556
---------------
$ 51,377,619
- --------------------------------------------------------------------------------------------------------
Utilities - Telephone - 0.2%
BellSouth Corp. 773,800 $ 36,223,513
- --------------------------------------------------------------------------------------------------------
Total U.S. Stocks $13,887,362,601
- --------------------------------------------------------------------------------------------------------
Foreign Stocks - 7.9%
Canada - 0.4%
Canadian National Railway Co. (Railroads) 2,300,400 $ 60,529,275
- --------------------------------------------------------------------------------------------------------
Finland - 0.5%
Nokia Corp., ADR (Telecommunications) 430,400 $ 81,776,000
- --------------------------------------------------------------------------------------------------------
France - 0.4%
AXA (Insurance) 420,800 $ 58,652,218
- --------------------------------------------------------------------------------------------------------
Germany - 1.2%
Mannesmann AG (Conglomerate) 767,300 $ 185,073,115
- --------------------------------------------------------------------------------------------------------
Ireland - 0.3%
Bank of Ireland (Banks and Credit Cos.)* 6,459,800 $ 51,394,753
- --------------------------------------------------------------------------------------------------------
Japan - 0.9%
Fast Retailing Co. (Retail) 82,100 $ 33,424,937
Hitachi Ltd. (Electronics) 3,858,000 61,921,315
Nippon Telephone & Telegraph Co. (Utilities -
Telephone) 3,135 53,692,014
---------------
$ 149,038,266
- --------------------------------------------------------------------------------------------------------
Netherlands - 1.1%
Akzo Nobel N.V. (Chemicals) 1,195,000 $ 59,933,531
KPN N.V. (Telecommunications)* 655,600 63,978,690
STMicroelectronics N.V. (Electronics) 312,900 47,384,794
---------------
$ 171,297,015
- --------------------------------------------------------------------------------------------------------
Switzerland - 0.6%
Nestle S.A. (Food and Beverage Products) 48,100 $ 88,149,588
- --------------------------------------------------------------------------------------------------------
United Kingdom - 2.5%
AstraZeneca Group PLC (Medical and Health Products) 1,288,700 $ 53,503,240
BP Amoco PLC, ADR (Oils) 4,691,062 278,238,615
Reuters Group PLC, ADR (Business Services) 756,165 61,107,584
---------------
$ 392,849,439
- --------------------------------------------------------------------------------------------------------
Total Foreign Stocks $ 1,238,759,669
- --------------------------------------------------------------------------------------------------------
Total Stocks (Identified Cost, $11,883,449,035) $15,126,122,270
- --------------------------------------------------------------------------------------------------------
Convertible Preferred Stock - 0.1%
- --------------------------------------------------------------------------------------------------------
Utilities - Electric - 0.1%
Texas Utilities Co., 3.315% (Identified Cost, $13,904,058) 335,000 $ 12,813,750
- --------------------------------------------------------------------------------------------------------
Convertible Bonds - 0.3%
- --------------------------------------------------------------------------------------------------------
PRINCIPAL AMOUNT
(000 OMITTED)
- --------------------------------------------------------------------------------------------------------
Financial Services - 0.1%
Bell Atlantic Financial Services, Inc., 4.25s, 2005## $ 18,870 $ 23,210,100
- --------------------------------------------------------------------------------------------------------
Telecommunications - 0.2%
NTL, Inc., 5.75s, 2009## $ 29,510 $ 31,723,250
- --------------------------------------------------------------------------------------------------------
Total Convertible Bonds (Identified Cost, $50,727,312) $ 54,933,350
- --------------------------------------------------------------------------------------------------------
Short-Term Obligations - 2.5%
- --------------------------------------------------------------------------------------------------------
PRINCIPAL AMOUNT
ISSUER (000 OMITTED) VALUE
- --------------------------------------------------------------------------------------------------------
American Express Credit Corp., due 1/03/00 $ 11,200 $ 11,197,356
Federal Home Loan Bank, due 1/03/00 - 1/07/00 145,600 145,563,667
Federal Home Loan Mortgage Corp., due 1/03/00 - 1/27/00 121,152 120,931,364
Federal National Mortgage Assn., due 1/14/00 - 1/20/00 55,000 54,865,011
Metropolitan Life Funding, Inc., due 1/31/00 10,000 9,951,000
National Rural Utilities Cooperative Finance Corp.,
due 1/18/00 40,000 39,889,122
- --------------------------------------------------------------------------------------------------------
Total Short-Term Obligations, at Amortized Cost $ 382,397,520
- --------------------------------------------------------------------------------------------------------
Total Investments (Identified Cost, $12,330,477,925) $15,576,266,890
Other Assets, Less Liabilities (1,198,812)
- --------------------------------------------------------------------------------------------------------
Net Assets - 100.0% $15,575,068,078
- --------------------------------------------------------------------------------------------------------
* Non-income producing security.
## SEC Rule 144A restriction.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
- -------------------------------------------------------------------------------
DECEMBER 31, 1999
- -------------------------------------------------------------------------------
Assets:
Investments, at value (identified cost, $12,330,477,925) $15,576,266,890
Cash 136,198
Foreign currency, at value (identified cost, $47,659) 48,028
Net receivable for foreign currency exchange contracts
closed or subject to master netting agreements 177,647
Receivable for Trust shares sold 28,805,823
Dividends and interest receivable 12,435,285
Other assets 98,745
---------------
Total assets $15,617,968,616
---------------
Liabilities:
Payable for Trust shares reacquired $ 40,631,805
Payable for investments purchased 4,348
Payable to affiliates -
Management fee 143,030
Shareholder servicing agent fee 43,002
Distribution and service fee 268,825
Accrued expenses and other liabilities 1,809,528
---------------
Total liabilities $ 42,900,538
---------------
Net assets $15,575,068,078
===============
Net assets consist of:
Paid-in capital $12,263,816,136
Unrealized appreciation on investments and translation of
assets and liabilities in foreign currencies 3,245,953,652
Accumulated undistributed net realized gain on investments
and foreign currency transactions 65,496,979
Accumulated distributions in excess of net investment income (198,689)
---------------
Total $15,575,068,078
===============
Shares of beneficial interest outstanding 747,886,208
===========
Class A shares:
Net asset value per share
(net assets of $8,513,612,993 / 406,362,438 shares of
beneficial interest outstanding) $20.95
======
Offering price per share (100 / 94.25 of net asset value per
share) $22.23
======
Class B shares:
Net asset value and offering price per share
(net assets of $5,471,742,629 / 264,523,904 shares of
beneficial interest outstanding) $20.69
======
Class C shares:
Net asset value and offering price per share
(net assets of $1,356,420,950 / 65,873,259 shares of
beneficial interest outstanding) $20.59
======
Class I shares:
Net asset value, offering price, and redemption price per share
(net assets of $233,291,305 / 11,126,597 shares of
beneficial interest outstanding) $20.97
======
Class J shares:
Net asset value and redemption price per share
(net assets of $200.77 / 9.704 shares of beneficial
interest outstanding) $20.69
======
Offering price per share (100 / 98 of net asset value per
share) $21.11
======
On sales of $50,000 or more, the offering price of Class A shares is reduced. A
contingent deferred sales charge may be imposed on redemptions of Class A, Class
B, and Class C shares.
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
Statement of Operations
- -------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1999
- -------------------------------------------------------------------------------
Net investment income:
Income -
Dividends $ 168,888,443
Interest 35,415,919
Foreign taxes withheld (1,056,990)
---------------
Total investment income $ 203,247,372
---------------
Expenses -
Management fee $ 47,450,876
Trustees' compensation 152,066
Shareholder servicing agent fee 14,807,013
Distribution and service fee (Class A) 28,422,778
Distribution and service fee (Class B) 48,750,376
Distribution and service fee (Class C) 11,804,845
Administration fee 322,360
Custodian fee 2,822,718
Printing 399,812
Postage 1,198,695
Auditing fees 36,991
Legal fees 37,610
Miscellaneous 8,364,985
---------------
Total expenses $ 164,571,125
Fees paid indirectly (1,922,366)
---------------
Net expenses $ 162,648,759
---------------
Net investment income $ 40,598,613
---------------
Realized and unrealized gain (loss) on investments:
Realized gain (loss) (identified cost basis) -
Investment transactions $ 474,180,490
Foreign currency transactions (402,275)
---------------
Net realized gain on investments and foreign currency
transactions $ 473,778,215
---------------
Change in unrealized appreciation (depreciation) -
Investments $ 431,355,710
Translation of assets and liabilities in foreign
currencies (1,702)
---------------
Net unrealized gain on investments and foreign
currency translation $ 431,354,008
---------------
Net realized and unrealized gain on investments and
foreign currency $ 905,132,223
---------------
Increase in net assets from operations $ 945,730,836
===============
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Statement of Changes in Net Assets
- ------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1999 1998
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase (decrease) in net assets:
From operations -
Net investment income $ 40,598,613 $ 55,718,341
Net realized gain on investments and foreign
currency transactions 473,778,215 553,340,597
Net unrealized gain on investments and foreign
currency translation 431,354,008 1,202,394,756
--------------- ---------------
Increase in net assets from operations $ 945,730,836 $ 1,811,453,694
--------------- ---------------
Distributions declared to shareholders -
From net investment income (Class A) $ (37,316,799) $ (47,277,704)
From net investment income (Class B) (1,062,901) (6,574,313)
From net investment income (Class C) (376,706) (1,450,350)
From net investment income (Class I) (1,842,205) (990,881)
From net realized gain on investments and foreign
currency transactions (Class A) (230,486,039) (338,382,495)
From net realized gain on investments and foreign
currency transactions (Class B) (146,952,144) (173,242,177)
From net realized gain on investments and foreign
currency transactions (Class C) (36,481,782) (35,278,921)
From net realized gain on investments and foreign
currency transactions (Class I) (6,470,396) (9,493,659)
In excess of net investment income (Class A) (2,034,099) (689,782)
In excess of net investment income (Class B) (57,938) (95,919)
In excess of net investment income (Class C) (20,534) (21,161)
In excess of net investment income (Class I) (100,417) (14,457)
--------------- ---------------
Total distributions declared to shareholders $ (463,201,960) $ (613,511,819)
--------------- ---------------
Net increase in net assets from Trust share
transactions $ 2,988,315,152 $ 4,827,471,013
--------------- ---------------
Total increase in net assets $ 3,470,844,028 $ 6,025,412,888
Net assets:
At beginning of period 12,104,224,050 6,078,811,162
--------------- ---------------
At end of period (including accumulated distributions
in excess of net investment income of $198,689 and
$172,914, respectively) $15,575,068,078 $12,104,224,050
=============== ===============
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
CLASS A
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per share data (for a share outstanding
throughout each period):
Net asset value - beginning of period $20.25 $17.52 $14.46 $12.71 $10.07
------ ------ ------ ------ ------
Income from investment operations# -
Net investment income $ 0.11 $ 0.17 $ 0.18 $ 0.21 $ 0.25
Net realized and unrealized gain on investments
and foreign currency 1.27 3.77 4.33 3.07 3.67
------ ------ ------ ------ ------
Total from investment operations $ 1.38 $ 3.94 $ 4.51 $ 3.28 $ 3.92
------ ------ ------ ------ ------
Less distributions declared to shareholders -
From net investment income $(0.09) $(0.16) $(0.17) $(0.21) $(0.46)
From net realized gain on investments and foreign
currency transactions (0.58) (1.05) (1.27) (1.32) (0.82)
In excess of net investment income (0.01) (0.00)+++ (0.01) -- --
------ ------ ------ ------ ------
Total distributions declared to shareholders $(0.68) $(1.21) $(1.45) $(1.53) $(1.28)
------ ------ ------ ------ ------
Net asset value - end of period $20.95 $20.25 $17.52 $14.46 $12.71
====== ====== ====== ====== ======
Total return(+) 6.96% 22.95% 31.69% 25.90% 39.34%
Ratios (to average net assets)/Supplemental data:
Expenses## 0.88% 0.73% 0.74% 0.74% 0.70%
Net investment income 0.55% 0.86% 1.09% 1.51% 2.13%
Portfolio turnover 62% 54% 44% 47% 54%
Net assets at end of period (000,000 Omitted) $8,514 $7,188 $4,323 $2,678 $2,074
+++ Per share amount was less than $0.01.
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from directed brokerage and certain expense offset arrangements.
(+) Total returns for Class A shares do not include the applicable sales charge. If the charge had been included, the results
would have been lower.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------------
CLASS B
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per share data (for a share outstanding
throughout each period):
Net asset value - beginning of period $20.04 $17.36 $14.36 $12.63 $10.03
------ ------ ------ ------ ------
Income from investment operations# -
Net investment income (loss) $(0.02) $ 0.04 $ 0.07 $ 0.10 $ 0.15
Net realized and unrealized gain on investments
and foreign currency 1.26 3.74 4.28 3.06 3.64
------ ------ ------ ------ ------
Total from investment operations $ 1.24 $ 3.78 $ 4.35 $ 3.16 $ 3.79
------ ------ ------ ------ ------
Less distributions declared to shareholders -
From net investment income $(0.01) $(0.05) $(0.08) $(0.11) $(0.37)
From net realized gain on investments and foreign
currency transactions (0.58) (1.05) (1.27) (1.32) (0.82)
In excess of net investment income (0.00)+++ (0.00)+++ (0.00)+++ -- --
------ ------ ------ ------ ------
Total distributions declared to shareholders $(0.59) $(1.10) $(1.35) $(1.43) $(1.19)
------ ------ ------ ------ ------
Net asset value - end of period $20.69 $20.04 $17.36 $14.36 $12.63
====== ====== ====== ====== ======
Total return 6.28% 22.16% 30.75% 25.05% 38.05%
Ratios (to average net assets)/Supplemental data:
Expenses## 1.53% 1.39% 1.41% 1.54% 1.56%
Net investment income (loss) (0.10)% 0.20% 0.42% 0.72% 1.25%
Portfolio turnover 62% 54% 44% 47% 54%
Net assets at end of period (000,000 Omitted) $5,472 $3,862 $1,522 $437 $165
+++ Per share amount was less than $0.01.
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from directed brokerage and certain expense offset arrangements.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- ----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, PERIOD ENDED
--------------------------------------------- DECEMBER 31,
1999 1998 1997 1996*
- ----------------------------------------------------------------------------------------------------------------------------
CLASS C
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Per share data (for a share outstanding
throughout each period):
Net asset value - beginning of period $19.95 $17.30 $14.33 $13.93
------ ------ ------ ------
Income from investment operations# -
Net investment income (loss) $(0.02) $ 0.04 $ 0.07 $ 0.05
Net realized and unrealized gain on investments
and foreign currency 1.25 3.72 4.27 1.76
------ ------ ------ ------
Total from investment operations $ 1.23 $ 3.76 $ 4.34 $ 1.81
------ ------ ------ ------
Less distributions declared to shareholders -
From net investment income $(0.01) $(0.06) $(0.10) $(0.09)
From net realized gain on investments and foreign
currency transactions (0.58) (1.05) (1.27) (1.32)
In excess of net investment income (0.00)+++ (0.00)+++ (0.00)+++ --
------ ------ ------ ------
Total distributions declared to shareholders $(0.59) $(1.11) $(1.37) $(1.41)
------ ------ ------ ------
Net asset value - end of period $20.59 $19.95 $17.30 $14.33
====== ====== ====== ======
Total return 6.27% 22.11% 30.76% 12.74%++
Ratios (to average net assets)/Supplemental data:
Expenses## 1.53% 1.40% 1.41% 1.49%+
Net investment income (loss) (0.10)% 0.20% 0.42% 0.77%+
Portfolio turnover 62% 54% 44% 47%
Net assets at end of period (000,000 Omitted) $1,356 $824 $211 $12
* For the period from the inception of Class C, July 1, 1996, through December 31, 1996.
+ Annualized.
++ Not annualized.
+++ Per share amount was less than $0.01.
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from directed brokerage and certain expense offset arrangements.
</TABLE>
See notes to financial statements.
<PAGE>
FINANCIAL STATEMENTS -- continued
<TABLE>
<CAPTION>
Financial Highlights - continued
- -------------------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31, PERIOD ENDED
------------------------------------ DECEMBER 31,
1999 1998 1997*
- -------------------------------------------------------------------------------------------------------------------------
CLASS I
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per share data (for a share outstanding
throughout each period):
Net asset value - beginning of period $20.26 $17.52 $14.33
------ ------ ------
Income from investment operations# -
Net investment income $ 0.18 $ 0.24 $ 0.26
Net realized and unrealized gain on investments and
foreign currency 1.28 3.77 4.44
------ ------ ------
Total from investment operations $ 1.46 $ 4.01 $ 4.70
------ ------ ------
Less distributions declared to shareholders -
From net investment income $(0.16) $(0.22) $(0.23)
From net realized gain on investments and foreign
currency transactions (0.58) (1.05) (1.27)
In excess of net investment income (0.01) (0.00)+++ (0.01)
------ ------ ------
Total distributions declared to shareholders $(0.75) $(1.27) $(1.51)
------ ------ ------
Net asset value - end of period $20.97 $20.26 $17.52
====== ====== ======
Total return 7.38% 23.40% 33.30%++
Ratios (to average net assets)/Supplemental data:
Expenses## 0.52% 0.41% 0.41%+
Net investment income 0.90% 1.19% 1.42%+
Portfolio turnover 62% 54% 44%
Net assets at end of period (000,000 Omitted) $233 $230 $23
* For the period from the inception of Class I, January 2, 1997, through December 31, 1997.
+ Annualized.
++ Not annualized.
# Per share data are based on average shares outstanding.
## Ratios do not reflect expense reductions from directed brokerage and certain expense offset arrangements.
</TABLE>
See notes to financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(1) Business and Organization
Massachusetts Investors Trust (the Trust) was organized as a common law trust
under the laws of the Commonwealth of Massachusetts in 1924 and is registered
under the Investment Company Act of 1940, as amended, as an open-end
diversified management investment company.
(2) Significant Accounting Policies
General - The preparation of 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 and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. The Trust
can invest in foreign securities. Investments in foreign securities are
vulnerable to the effects of changes in the relative values of the local
currency and the U.S. dollar and to the effects of changes in each country's
legal, political, and economic environment.
Investment Valuations - Equity securities listed on securities exchanges or
reported through the NASDAQ system are reported at market value using last
sale prices. Unlisted equity securities or listed equity securities for which
last sale prices are not available are reported at market value using last
quoted bid prices. Debt securities (other than short-term obligations which
mature in 60 days or less), including listed issues, and forward contracts,
are valued on the basis of valuations furnished by dealers or by a pricing
service with consideration to factors such as institutional-size trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics, and other market data, without exclusive
reliance upon exchange or over-the-counter prices. Short-term obligations,
which mature in 60 days or less, are valued at amortized cost, which
approximates market value. Securities for which there are no such quotations
or valuations are valued in good faith by the Trustees.
Foreign Currency Translation - Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are converted each
business day into U.S. dollars based upon current exchange rates. Purchases
and sales of foreign investments, income, and expenses are converted into U.S.
dollars based upon currency exchange rates prevailing on the respective dates
of such transactions. Gains and losses attributable to foreign currency
exchange rates on sales of securities are recorded for financial statement
purposes as net realized gains and losses on investments. Gains and losses
attributable to foreign exchange rate movements on income and expenses are
recorded for financial statement purposes as foreign currency transaction
gains and losses. That portion of both realized and unrealized gains and
losses on investments that results from fluctuations in foreign currency
exchange rates is not separately disclosed.
Deferred Trustee Compensation - Effective July 24, 1999, under a Deferred
Compensation Plan (the Plan) independent Trustees may elect to defer receipt
of all or a portion of their annual compensation. Deferred amounts are treated
as though equivalent dollar amounts had been invested in shares of the Trust
or other MFS Trusts selected by the Trustee. Deferred amounts represent an
unsecured obligation of the Trust until distributed in accordance with the
Plan.
Security Loans - State Street Bank and Trust Company ("State Street") as lending
agent, may loan the securities of the Trust to certain qualified institutions
(the "Borrowers") approved by the Trust. The loans are collateralized at all
times by U.S. Treasury securities in an amount at least equal to the market
value of the securities loaned. State Street provides the Trust with
indemnification against Borrower default.
On loans collateralized by U.S. Treasury securities, a fee is received from
the Borrower, and is allocated between the Trust and the lending agent. Income
from securities lending is included in interest income on the Statement of
Operations. The dividend and interest income earned on the securities loaned
is accounted for in the same manner as other dividend and interest income.
At December 31, 1999, the value of securities loaned was $89,016,025. These
loans were collateralized by U.S. Treasury securities of $89,374,532.
Forward Foreign Currency Exchange Contracts - The Trust may enter into forward
foreign currency exchange contracts for the purchase or sale of a specific
foreign currency at a fixed price on a future date. Risks may arise upon
entering into these contracts from the potential inability of counterparties
to meet the terms of their contracts and from unanticipated movements in the
value of a foreign currency relative to the U.S. dollar. The Trust may enter
into forward contracts for hedging purposes as well as for non-hedging
purposes. For hedging purposes, the Trust may enter into contracts to deliver
or receive foreign currency it will receive from or require for its normal
investment activities. The Trust may also use contracts in a manner intended
to protect foreign currency-denominated securities from declines in value due
to unfavorable exchange rate movements. For non-hedging purposes, the Trust
may enter into contracts with the intent of changing the relative exposure of
the Trust's portfolio of securities to different currencies to take advantage
of anticipated changes. The forward foreign currency exchange contracts are
adjusted by the daily exchange rate of the underlying currency and any gains
or losses are recorded as unrealized until the contract settlement date. On
contract settlement date, the gains or losses are recorded as realized gains
or losses on foreign currency transactions.
Investment Transactions and Income - Investment transactions are recorded on
the trade date. Interest income is recorded on the accrual basis. All discount
is accreted for financial statement and tax reporting purposes as required by
federal income tax regulations. Dividends received in cash are recorded on the
ex-dividend date. Dividend and interest payments received in additional
securities are recorded on the ex-dividend or ex-interest date in an amount
equal to the value of the security on such date.
Fees Paid Indirectly - The Trust's custody fee is calculated as a percentage
of the Trust's month end net assets. The fee is reduced according to an
arrangement that measures the value of cash deposited with the custodian by
the Trust. During the period, the Trust's custodian fees were reduced by
$1,302,394 under this arrangement. The Trust has entered into a directed
brokerage agreement, under which the broker will credit the Trust a portion of
the commissions generated, to offset certain expenses of the Trust. For the
period, the Trust's custodian fees were reduced by $619,972 under this
agreement. These amounts are shown as a reduction of expenses on the Statement
of Operations.
Tax Matters and Distributions - The Trust's policy is to comply with the
provisions of the Internal Revenue Code (the Code) applicable to regulated
investment companies and to distribute to shareholders all of its taxable
income, including any net realized gain on investments. Accordingly, no
provision for federal income or excise tax is provided.
Distributions to shareholders are recorded on the ex-dividend date. The Trust
distinguishes between distributions on a tax basis and a financial reporting
basis and requires that only distributions in excess of tax basis earnings and
profits be reported in the financial statements as distributions from paid-in
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits, which result in
temporary over-distributions for financial statement purposes, are classified
as distributions in excess of net investment income or net realized gains.
During the year ended December 31, 1999, accumulated distributions in excess
of net investment income decreased by $2,187,211 accumulated undistributed net
realized gain on investments and foreign currency transactions decreased by
$40,595,243 and paid in capital increased by $38,408,032 due to differences
between book and tax accounting for distributions and currency transactions.
This change had no effect on the net assets or net asset value per share.
Multiple Classes of Shares of Beneficial Interest - The Trust offers multiple
classes of shares, which differ in their respective distribution and service
fees. All shareholders bear the common expenses of the Trust based on daily
net assets of each class, without distinction between share classes. Dividends
are declared separately for each class. Differences in per share dividend
rates are generally due to differences in separate class expenses. Class B
shares will convert to Class A shares approximately eight years after
purchase.
(3) Transactions with Affiliates
Investment Adviser - The Trust has an investment advisory agreement with
Massachusetts Financial Services Company (MFS) to provide overall investment
advisory and administrative services, and general office facilities. The
management fee is computed daily and paid monthly at an annual rate of 0.33%
of the Trust's average daily net assets.
The Trust pays no compensation directly to its Trustees who are officers of
the investment adviser, or to officers of the Trust, all of whom receive
remuneration for their services to the Trust from MFS. Certain officers and
Trustees of the Trust are officers or directors of MFS, MFS Trust
Distributors, Inc. (MFD), and MFS Service Center, Inc. (MFSC). The Trust has
an unfunded defined benefit plan for all of its independent Trustees. Included
in Trustees' compensation is a net periodic pension expense of $53,786 for the
year ended December 31, 1999.
Administrator - The Trust has an administrative services agreement with MFS to
provide the Trust with certain financial, legal, shareholder servicing,
compliance, and other administrative services. As a partial reimbursement for
the cost of providing these services, the Trust pays MFS an administrative fee
at the following annual percentages of the Trust's average daily net assets:
First $1 billion 0.0150%
Next $1 billion 0.0125%
Next $1 billion 0.0100%
In excess of $3 billion 0.0000%
Distributor - MFD, a wholly owned subsidiary of MFS, as distributor, received
$5,090,432 for the year ended December 31, 1999, as its portion of the sales
charge on sales of Class A shares of the Trust.
The Trustees have adopted a distribution plan for Class A, Class B, Class C,
and Class J shares pursuant to Rule 12b-1 of the Investment Company Act of
1940 as follows:
The Trust's distribution plan provides that the Trust will pay MFD up to 0.35%
per annum of its average daily net assets attributable to Class A shares in
order that MFD may pay expenses on behalf of the Trust related to the
distribution and servicing of its shares. These expenses include a service fee
paid to each securities dealer that enters into a sales agreement with MFD of
up to 0.25% per annum of the Trust's average daily net assets attributable to
Class A shares which are attributable to that securities dealer and a
distribution fee to MFD of up to 0.10% per annum of the Trust's average daily
net assets attributable to Class A shares. MFD retains the service fee for
accounts not attributable to a securities dealer, which amounted to $2,003,802
for the year ended December 31, 1999. Fees incurred under the distribution
plan during the year ended December 31, 1999, were 0.35% of average daily net
assets attributable to Class A shares on an annualized basis.
The Trust's distribution plan provides that the Trust will pay MFD a
distribution fee of 0.75% per annum, and a service fee of up to 0.25% per
annum, of the Trust's average daily net assets attributable to Class B and
Class C shares. MFD will pay to securities dealers that enter into a sales
agreement with MFD all or a portion of the service fee attributable to Class B
and Class C shares, and will pay to such securities dealers all of the
distribution fee attributable to Class C shares. The service fee is intended
to be consideration for services rendered by the dealer with respect to Class
B and Class C shares. MFD retains the service fee for accounts not
attributable to a securities dealer, which amounted to $86,006 and $11,813 for
Class B and Class C shares, respectively, for the year ended December 31,
1999. Fees incurred under the distribution plan during the year ended December
31, 1999, were 1.00% and 1.00% of average daily net assets attributable to
Class B and Class C shares, respectively, on an annualized basis.
The Trust's distribution plan provides that the Trust will pay MFD a
distribution fee of up to 0.75% per annum, and a service fee of up to 0.25%
per annum, of the Trust's average daily net assets attributable to Class J
shares. Class J shares are available for distribution through Monex, Inc.
("Monex") and its network of financial intermediaries. Monex also serves as
the Trust's Agent Company in Japan, and in that capacity represents the Trust
before Japanese regulatory authorities. MFD will pay to Monex all of the
service fee attributable to Class J shares. Out of the distribution fee, MFD
will pay to Monex 0.615% per annum of average net assets attributable to Class
J shares and will retain the remaining 0.135%. A portion of the distribution
fee to Monex, equal to 0.05% per annum of the Trust's average daily net assets
attributable to Class J shares, is paid to cover its services as the Trust's
Agent Company. Fees incurred under the distribution plan during the year ended
December 31, 1999 were 0.00% of average net asset attributable to Class J
shares on an annualized basis.
Certain Class A and Class C shares are subject to a contingent deferred sales
charge in the event of a shareholder redemption within 12 months following
purchase. A contingent deferred sales charge is imposed on shareholder
redemptions of Class B shares in the event of a shareholder redemption within
six years of purchase. MFD receives all contingent deferred sales charges.
Contingent deferred sales charges imposed during the year ended December 31,
1999, were $190,409, $9,961,088, and $608,732 for Class A, Class B, and Class
C shares, respectively.
Shareholder Servicing Agent - MFSC, a wholly owned subsidiary of MFS, earns a
fee for its services as shareholder servicing agent. The fee is calculated as
a percentage of the Trust's average daily net assets at an annual rate of
0.10%. Prior to April 1, 1999, the fee was calculated as a percentage of the
Trust's average daily net assets at an annual rate of 0.1125%.
(4) Portfolio Securities
Purchases and sales of investments, other than purchased option transactions
and short-term obligations, were as follows:
PURCHASES SALES
- --------------------------------------------------------------------------------
U.S. government securities $ 52,432,090 $ 47,399,707
--------------- --------------
Investments (non-U.S. government securities) $11,230,896,176 $8,407,776,615
--------------- --------------
The cost and unrealized appreciation and depreciation in the value of the
investments owned by the Trust, as computed on a federal income tax basis, are
as follows:
Aggregate cost $12,363,232,166
---------------
Gross unrealized appreciation $ 3,547,744,788
Gross unrealized depreciation (334,710,064)
---------------
Net unrealized appreciation $ 3,213,034,724
===============
(5) Shares of Beneficial Interest
The Trustees have authorized 5,000,000,000 full and fractional shares of
beneficial interest. Transactions in Trust shares were as follows:
<TABLE>
<CAPTION>
Class A Shares
YEAR ENDED DECEMBER 31, 1999 YEAR ENDED DECEMBER 31, 1998
---------------------------------- ---------------------------------
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 160,629,325 $ 3,274,822,782 188,053,209 $ 3,608,217,877
Shares issued to shareholders
in reinvestment of
distributions 10,234,817 206,329,133 15,584,563 299,682,621
Shares reacquired (119,487,339) (2,430,201,848) (95,426,304) (1,827,133,744)
----------- --------------- ----------- ---------------
Net increase 51,376,803 $ 1,050,950,067 108,211,468 $ 2,080,766,754
=========== =============== =========== ===============
<CAPTION>
Class B Shares
YEAR ENDED DECEMBER 31, 1999 YEAR ENDED DECEMBER 31, 1998
---------------------------------- ---------------------------------
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 109,984,184 $ 2,219,618,738 116,467,254 $ 2,214,401,035
Shares issued to shareholders
in reinvestment of
distributions 6,297,451 125,542,534 8,179,698 155,643,628
Shares reacquired (44,493,378) (896,094,844) (19,577,588) (367,348,197)
----------- --------------- ----------- ---------------
Net increase 71,788,257 $ 1,449,066,428 105,069,364 $ 2,002,696,466
=========== =============== =========== ===============
<CAPTION>
Class C Shares
YEAR ENDED DECEMBER 31, 1999 YEAR ENDED DECEMBER 31, 1998
---------------------------------- ---------------------------------
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 39,008,454 $ 783,390,329 32,700,952 $ 620,311,183
Shares issued to shareholders
in reinvestment of
distributions 1,296,414 25,729,120 1,344,955 25,279,036
Shares reacquired (15,750,666) (315,548,170) (4,935,864) (92,639,154)
----------- --------------- ----------- ---------------
Net increase 24,554,202 $ 493,571,279 29,100,043 $ 552,951,065
=========== =============== =========== ===============
<CAPTION>
Class I Shares
YEAR ENDED DECEMBER 31, 1999 YEAR ENDED DECEMBER 31, 1998
---------------------------------- ---------------------------------
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 2,580,474 $ 52,167,868 10,276,343 $ 195,389,933
Shares issued to shareholders
in reinvestment of
distributions 341,628 6,888,845 485,401 9,318,575
Shares reacquired (3,150,136) (64,329,536) (694,274) (13,651,780)
----------- --------------- ----------- ---------------
Net increase (decrease) (228,034) $ (5,272,823) 10,067,470 $ 191,056,728
=========== =============== =========== ===============
Class J Shares
PERIOD ENDED DECEMBER 31, 1999*
----------------------------------
SHARES AMOUNT
- -----------------------------------------------------------------
Shares sold 9.704 $ 200.77
* For the period from the inception of Class J, December 31, 1999, through December 31, 1999. There was no
operating activity associated with Class J shares for this period.
</TABLE>
(6) Line of Credit
The Trust and other affiliated funds participate in an $820 million unsecured
line of credit provided by a syndication of banks under a line of credit
agreement. Borrowings may be made to temporarily finance the repurchase of
Trust shares. Interest is charged to each fund, based on its borrowings, at a
rate equal to the bank's base rate. In addition, a commitment fee, based on
the average daily unused portion of the line of credit, is allocated among the
participating funds at the end of each quarter. The commitment fee allocated
to the Trust for the year ended December 31, 1999, was $109,082. The Trust had
no borrowings during the year.
(7) Financial Instruments
The Trust trades financial instruments with off-balance-sheet risk in the normal
course of its investing activities in order to manage exposure to market risks
such as interest rates and foreign currency exchange rates. These financial
instruments include forward foreign currency exchange contracts. The notional or
contractual amounts of these instruments represent the investment the Trust has
in particular classes of financial instruments and does not necessarily
represent the amounts potentially subject to risk. The measurement of the risks
associated with these instruments is meaningful only when all related and
offsetting transactions are considered.
At December 31, 1999, forward foreign currency sales under master netting
agreements amounted to a net receivable of $177,647 with First Boston Corp.
At December 31, 1999, the Trust had sufficient cash and/or securities to cover
any commitments under these contracts.
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Trustees and Shareholders of Massachusetts Investors Trust:
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of Massachusetts Investors Trust as of
December 31, 1999, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Trust's 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 December 31, 1999, by correspondence with the custodian and
brokers; where replies were not received from brokers, we performed other
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
Massachusetts Investors Trust as of December 31, 1999, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the five years in the period then ended, in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
February 3, 2000
<PAGE>
- --------------------------------------------------------------------------------
FEDERAL TAX INFORMATION
- --------------------------------------------------------------------------------
IN JANUARY 2000, SHAREHOLDERS WILL BE MAILED A FORM 1099-DIV REPORTING
THE FEDERAL TAX STATUS OF ALL DISTRIBUTIONS PAID DURING THE CALENDAR
YEAR 1999.
THE TRUST HAS DESIGNATED $461,387,879 AS A CAPITAL GAIN DIVIDEND FOR THE
YEAR ENDED DECEMBER 31, 1999.
FOR THE YEAR ENDED DECEMBER 31, 1999, THE AMOUNT OF DISTRIBUTIONS FROM
INCOME ELIGIBLE FOR THE 70% DIVIDENDS RECEIVED DEDUCTION FOR
CORPORATIONS IS 100.00%.
<PAGE>
MFS' YEAR 2000 READINESS DISCLOSURE
MFS Investment Management(R), as an investment adviser and
on behalf of the MFS funds, is committed to the effective
use of technology in managing our portfolio investments,
delivering high-quality service to MFS fund shareholders, [Graphic Omitted]
retirement plan participants, and MFS' institutional
clients, and supporting the financial consultants who sell
our products.
MFS can now say that it is ready for the Year 2000. Our testing has demonstrated
that MFS' computer hardware and software will recognize "00" as the Year 2000
and will not confuse those digits with 1900. All of our critical business
applications and processes have been successfully tested, and we have adopted
companywide policies that will help us maintain our readiness through the
remainder of the year. Any new technology that is brought into the company
before the end of the year will be held to the same stringent standards as our
current technology. We have also developed a vendor readiness survey, contacted
over 700 of our vendors, and established an ongoing process to review responses,
as well as to review readiness statements of new vendors and products.
MFS recognizes that fund shareholders and institutional clients also are
concerned about whether the companies whose securities are held in their
portfolios are addressing Y2K issues. As part of the MFS Original Research(R)
process of evaluating portfolio investments, one of the many relevant factors
that MFS' portfolio managers and research analysts may consider is a company's
Y2K readiness.
Y2K readiness is an enormously complex, worldwide issue. No company or
institution can guarantee that it will be unaffected by the Y2K issue. While MFS
is taking significant steps to protect the integrity of its internal systems,
there can be no assurance that these steps will be sufficient to avoid any
adverse impact on MFS fund shareholders, retirement plan participants, or
institutional clients.
If you have further questions regarding MFS' Year 2000 Readiness Program, please
visit our Web site at www.mfs.com, call our toll-free line, 1-800-637-4406, or
write to the MFS Year 2000 Program Management Office by e-mail at [email protected] or
by letter at 500 Boylston Street, Boston, MA 02116-3741.
<PAGE>
<TABLE>
MASSACHUSETTS INVESTORS TRUST
<S> <C>
TRUSTEES SECRETARY
Richard B. Bailey - Private Investor; Stephen E. Cavan*
Former Chairman and Director (until 1991),
MFS Investment Management(R) ASSISTANT SECRETARY
James R. Bordewick, Jr.*
J. Atwood Ives+ - Chairman and Chief Executive
Officer, Eastern Enterprises (diversified services CUSTODIAN
company) State Street Bank and Trust Company
Lawrence T. Perera+ - Partner, Hemenway AUDITORS
& Barnes (attorneys) Deloitte & Touche LLP
William J. Poorvu+ - Adjunct Professor, Harvard INVESTOR INFORMATION
University Graduate School of Business
Administration For information on MFS mutual funds, call your
financial consultant or, for an information kit,
Charles W. Schmidt+ - Private Investor call toll free: 1-800-637-2929 any business day
from 9 a.m. to 5 p.m. Eastern time (or leave a
Arnold D. Scott* - Senior Executive message anytime).
Vice President, Director, and Secretary,
MFS Investment Management INVESTOR SERVICE
MFS Service Center, Inc.
Jeffrey L. Shames* - Chairman and Chief P.O. Box 2281
Executive Officer, MFS Investment Management Boston, MA 02107-9906
Elaine R. Smith+ - Independent Consultant For general information, call toll free:
1-800-225-2606 any business day from
David B. Stone+ - Chairman, North American 8 a.m. to 8 p.m. Eastern time.
Management Corp. (investment advisers)
For service to speech- or hearing-impaired, call
INVESTMENT ADVISER toll free: 1-800-637-6576 any business day from 9
Massachusetts Financial Services Company a.m. to 5 p.m. Eastern time. (To use this service,
500 Boylston Street your phone must be equipped with a
Boston, MA 02116-3741 Telecommunications Device for the Deaf.)
DISTRIBUTOR For share prices, account balances, exchanges, or
MFS Fund Distributors, Inc. stock and bond outlooks, call toll free:
500 Boylston Street 1-800-MFS-TALK (1-800-637-8255) anytime from a
Boston, MA 02116-3741 touch-tone telephone.
CHAIRMAN AND PRESIDENT WORLD WIDE WEB
Jeffrey L. Shames* www.mfs.com
PORTFOLIO MANAGERS
Mitchell D. Dynan*
John D. Laupheimer, Jr.*
TREASURER
W. Thomas London*
ASSISTANT TREASURERS
Mark E. Bradley*
Ellen Moynihan*
James O. Yost*
+ Independent Trustee
* MFS Investment Management
</TABLE>
<PAGE>
MASSACHUSETTS ------------
INVESTORS TRUST BULK RATE
U.S. POSTAGE
[Logo] M F S(R) PAID
INVESTMENT MANAGEMENT MFS
We invented the mutual fund(R) ------------
500 Boylston Street
Boston, MA 02116-3741
(c)2000 MFS Investment Management.(R)
MFS(R) investment products are offered through MFS Fund Distributors, Inc.,
500 Boylston Street, Boston, MA 02116
MIT-2 02/00 944M 12/212/312/812
