<PAGE>
[LOGO OF NEW ENGLAND FINANCIAL]
-------------------------------------------------------------------------
ZENITH FUND
VARIABLE PRODUCTS
SEMIANNUAL REPORTS
JUNE 30, 2000
<PAGE>
TABLE OF CONTENTS
NEW ENGLAND ZENITH FUND
<TABLE>
<S> <C>
Back Bay Advisors Money Market Series....................................... 1
Back Bay Advisors Bond Income Series........................................ 7
Salomon Brothers Strategic Bond Opportunities Series........................ 14
Salomon Brothers U.S. Government Series..................................... 25
Back Bay Advisors Managed Series............................................ 31
Balanced Series............................................................. 41
Alger Equity Growth Series.................................................. 52
Capital Growth Series....................................................... 59
Davis Venture Value Series.................................................. 64
Harris Oakmark Mid Cap Value Series......................................... 71
Loomis Sayles Small Cap Series.............................................. 76
MFS Investors Series........................................................ 84
MFS Research Managers Series................................................ 91
Westpeak Growth and Income Series........................................... 98
Westpeak Stock Index Series................................................. 105
Morgan Stanley International Magnum Equity Series........................... 116
Notes to Financial Statements............................................... 127
Footnotes to Portfolio Manager Commentary................................... 134
New England Variable Life Separate Account.................................. 136
METROPOLITAN SERIES FUND, INC.
Putnam International Stock Portfolio........................................
Janus Mid Cap Portfolio.....................................................
Russell 2000(R) Index Portfolio.............................................
Putnam Large Cap Growth Portfolio...........................................
Notes to Financial Statements...............................................
FIDELITY VARIABLE INSURANCE PRODUCTS FUNDS -- INITIAL CLASS
Fidelity VIP High Income Portfolio..........................................
Fidelity VIP II Asset Manager Portfolio.....................................
Fidelity VIP Equity-Income Portfolio........................................
Fidelity VIP Overseas Portfolio.............................................
</TABLE>
IMPORTANT:
Some funds appearing in this report may not be available under your variable
life or variable annuity product.
<PAGE>
August, 2000
TO OUR POLICYHOLDERS/CONTRACT OWNERS:
We are pleased to provide you with the 2000 Semi Annual Report for the Zenith
variable life insurance and variable annuity products.* This report includes
performance histories, present investments, and financial reports as of June
30, 2000, as well as the outlook and strategy of each fund. The report covers
the New England Zenith Fund, the Metropolitan Series Fund, Inc., and initial
class shares of the Fidelity Variable Insurance Products Fund and Variable
Insurance Products Fund II. It is intended to help you make an informed
decision regarding the investment of the contract value of your variable
product.
New England Financial and its affiliates offer many variable life and variable
annuity products to help you meet your financial objectives. We are committed
to meeting your expectations by providing quality products with strong
performance potential and excellent personal service.
Please feel free to contact your Registered Representative with any questions
you may have regarding your financial objectives. Thank you for choosing a
Zenith Variable product.
Sincerely,
/s/ Mary Ann Brown
Mary Ann Brown
President, New England Financial Products & Services
* Variable products are offered through New England Securities Corporation.
New England Financial is the service mark for New England Life Insurance
Company, Boston, MA and related companies.
[LOGO OF RECYCLABLES]
printed on recycled, recyclable paper
<PAGE>
The National Association of Securities Dealers Regulation, Inc. (NASDR) has a
"Public Disclosure Program" which provides current and historical information
on registered representatives and Financial Institutions registered with the
NASD. If you would like information pertaining to the "Public Disclosure
Program", including an informational brochure that describes the program, you
may contact the NASD directly by calling the NASDR, Inc. Public Disclosure
Hotline at 800-289-9999 or by visiting the NASDR, Inc.'s website at
www.nasdr.com.
If you would like to contact New England Financial concerning any aspect of
your variable annuity contract, please call our customer service team at 800-
435-4117. Please call 800-388-4000 if you have any questions on our variable
life products.
<PAGE>
Semi-Annual Reports dated June 30, 2000 of the underlying funds are incorporated
herein by reference as the reports sent to contractowners of the New England
Variable Life Separate Account of New England Life Insurance Company pursuant to
Rule 30d-2 of the Investment Company Act of 1940.
Incorporated by reference are all series of New England Zenith Fund, Inc. filed
on Form N-30D on September 5, 2000, Accession number 0000927016-00-003228.
Incorporated by reference are the Putnam International Stock Portfolio, Janus
Mid Cap Portfolio, Russell 2000 Index Portfolio and the Putnam Large Cap Growth
Portfolio of Metropolitan Series Fund, Inc. as included in the Fund N-30D filing
filed on August 28, 2000, Accession number 0000950130-00-004697.
Incorporated by reference are the High Income Portfolio, Equity-Income Portfolio
and the Overseas Portfolio of the Fidelity Variable Insurance Products Fund as
included in the Fund N-30D filing filed on August 24, 2000, Accession No.
0000356494-00-500001.
Incorporated by reference is the Asset Manager Portfolio of the Fidelity
Variable Insurance Products Fund II as included in the Fund N-30D filing filed
on August 24, 2000, Accession No. 0000831016-00-500001.
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Assets and Liabilities
June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
---------------------------------------------------------------------------
Capital Bond Money Stock Midcap
Growth Income Market Index Managed Value
Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account
-------------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Assets
Investments in
New England
Zenith Fund,
Metropolitan
Series Fund,
Variable
Insurance
Products Fund,
and Variable
Insurance
Products Fund
II at value
(Note 2)....... $1,123,384,081 $74,610,091 $73,395,395 $200,882,751 $70,800,260 $36,076,125
<CAPTION>
----------------------------------------------------------
Growth U.S.
and Small Govern- Equity
Income Cap ment Balanced Growth
Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account
----------- ------------ -------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Assets
Investments in
New England
Zenith Fund,
Metropolitan
Series Fund,
Variable
Insurance
Products Fund,
and Variable
Insurance
Products Fund
II at value
(Note 2)....... $96,058,930 $135,082,006 $785,442 $16,227,155 $320,845,558
</TABLE>
<TABLE>
<CAPTION>
Shares Cost
---------- --------------
<S> <C> <C>
Capital Growth
Series......... 2,743,173 $1,047,956,367
Back Bay
Advisors Bond
Income Series.. 715,547 77,338,222
Back Bay
Advisors Money
Market Series.. 733,954 73,395,395
Westpeak Stock
Index Series... 873,935 137,693,376
Back Bay
Advisors
Managed Series. 357,523 60,807,147
Harris Oakmark
Midcap Value
Series......... 299,710 40,811,303
Westpeak Growth
and Income
Series......... 500,594 90,685,788
Loomis Sayles
Small Cap
Series......... 620,382 99,469,012
Salomon Brothers
U.S. Government
Series......... 70,254 816,865
Balanced Series. 1,164,907 18,322,043
Alger Equity
Growth Series.. 10,471,461 257,311,005
Morgan Stanley
International
Magnum Equity
Series......... 1,568,585 18,397,616
Davis Venture
Value Series... 7,362,267 159,472,052
Salomon Brothers
Bond
Opportunities
Series......... 94,658 1,171,580
MFS Investors
Series......... 172,654 6,221,497
MFS Research
Managers
Series......... 421,074 9,401,922
Janus Mid Cap
Portfolio...... 199,317 6,600,080
Putnam Large Cap
Growth
Portfolio...... 92,490 889,473
Russell 2000
Index
Portfolio...... 74,007 921,558
Putnam
International
Stock
Portfolio...... 3,059 41,958
VIP Equity-
Income
Portfolio...... 6,885,378 133,482,013
VIP Overseas
Portfolio...... 8,331,215 168,389,257
VIP High Income
Portfolio...... 1,510,606 17,847,780
VIP II Asset
Manager
Portfolio...... 869,225 14,189,153
--------------
Total $2,441,632,462
==============
</TABLE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Amount due and
accrued from
policy-related
transactions,
net........... (22,204) 12,833 39,134 188,376 23,936 (2,848) 37,758 184,977 (29,778)
Dividends
receivable.... -- -- 354,822 -- -- -- -- -- --
-------------- ----------- ----------- ------------ ----------- ----------- ----------- ------------ --------
Total Assets.. 1,123,361,877 74,622,924 73,789,348 201,071,127 70,824,196 36,073,277 96,096,688 135,266,983 755,664
Liabilities
Due to New
England Life
Insurance
Company....... 77,966,684 6,783,829 9,227,629 22,037,878 6,382,142 3,434,066 5,771,112 14,734,748 36,752
-------------- ----------- ----------- ------------ ----------- ----------- ----------- ------------ --------
Total
Liabilities.. 77,966,684 6,783,829 9,227,629 22,037,878 6,382,142 3,434,066 5,771,112 14,734,748 36,752
-------------- ----------- ----------- ------------ ----------- ----------- ----------- ------------ --------
Net Assets for
Variable Life
Insurance
Policies....... $1,045,395,191 $67,839,095 $64,561,719 $179,033,249 $64,442,054 $32,639,211 $90,325,576 $120,532,235 $718,912
============== =========== =========== ============ =========== =========== =========== ============ ========
<S> <C> <C>
Amount due and
accrued from
policy-related
transactions,
net........... (5,710) 413,587
Dividends
receivable.... -- --
------------ ------------
Total Assets.. 16,221,445 321,259,145
Liabilities
Due to New
England Life
Insurance
Company....... 1,699,345 39,688,298
------------ ------------
Total
Liabilities.. 1,699,345 39,688,298
------------ ------------
Net Assets for
Variable Life
Insurance
Policies....... $14,522,100 $281,570,847
============ ============
</TABLE>
See Notes to Financial Statements
136
<PAGE>
<TABLE>
<CAPTION>
Metropolitan Series Fund
----------------------------------------------------------- -------------------------------------
Interna-
tional Bond Large Russell Interna-
Magnum Venture Oppor- Research Cap 2000 tional
Equity Value tunities Investors Managers Mid Cap Growth Index Stock
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account Account
----------- ------------ ---------- ---------- ---------- ---------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$21,740,593 $210,266,359 $1,029,873 $1,781,792 $5,381,326 $7,113,618 $923,975 $948,772 $42,251
8,879 413,278 (10,239) 120,898 13,874 288,055 1,532 8,986 0
-- -- -- -- -- -- -- -- --
----------- ------------ ---------- ---------- ---------- ---------- -------- -------- -------
21,749,472 210,679,637 1,019,634 1,902,690 5,395,200 7,401,673 925,507 957,758 42,251
2,401,477 28,048,578 49,600 241,549 497,603 789,385 130,622 65,397 0
----------- ------------ ---------- ---------- ---------- ---------- -------- -------- -------
2,401,477 28,048,578 49,600 241,549 497,603 789,385 130,622 65,397 0
----------- ------------ ---------- ---------- ---------- ---------- -------- -------- -------
$19,347,995 $182,631,059 $ 970,034 $1,661,141 $4,897,597 $6,612,288 $794,885 $892,361 $42,251
=========== ============ ========== ========== ========== ========== ======== ======== =======
<CAPTION>
Variable Variable
Insurance Insurance
Products Products
Fund Fund II
------------------------------------------------ --------------
Equity- Over- High Asset
Income seas Income Manager
Sub- Sub- Sub- Sub-
Account Account Account Account Total
------------ ------------ ----------- ----------- --------------
<S> <C> <C> <C> <C>
$157,744,016 $195,450,310 $15,166,488 $14,376,986 $2,780,114,150
58,702 225,113 18,291 24,425 2,011,855
-- -- -- -- 354,822
------------ ------------ ----------- ----------- --------------
157,802,718 195,675,423 15,184,779 14,401,411 2,782,480,827
15,604,061 15,642,072 1,574,328 1,575,691 254,382,846
------------ ------------ ----------- ----------- --------------
15,604,061 15,642,072 1,574,328 1,575,691 254,382,846
------------ ------------ ----------- ----------- --------------
$142,198,657 $180,033,351 $13,610,451 $12,825,720 $2,528,097,981
============ ============ =========== =========== ==============
</TABLE>
See Notes to Financial Statements
137
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Operations
For the Six Months Ended June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
-----------------------------------------------------------------------------------------------------
Growth
Capital Bond Money Stock Midcap and Small
Growth Income Market Index Managed Value Income Cap
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account
------------ ----------- ---------- ----------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Income
Dividends........ $ -- $ -- $2,310,839 $ -- $ -- $ -- $ -- $ --
Expense
Mortality and
expense risk
charge (Note 3).. 3,553,802 246,580 293,885 653,613 221,836 118,952 321,503 425,715
------------ ----------- ---------- ----------- ---------- ----------- ----------- -----------
Net investment
income (loss).... (3,553,802) (246,580) 2,016,954 (653,613) (221,836) (118,952) (321,503) (425,715)
Net Realized and
Unrealized
Gain (Loss) on
Investments
Net unrealized
appreciation
(depreciation)
on investments:
Beginning of
period.......... 145,014,283 (4,499,584) -- 63,685,270 9,600,369 (4,330,144) 8,566,144 27,466,967
End of period... 75,427,714 (2,728,130) -- 63,189,376 9,993,112 (4,735,178) 5,373,141 35,612,993
------------ ----------- ---------- ----------- ---------- ----------- ----------- -----------
Net change in
unrealized
appreciation
(depreciation)... (69,586,571) 1,771,453 -- (495,894) 392,743 (405,034) (3,193,002) 8,146,026
Net realized
gain (loss) on
investments...... 45,495 10,789 -- (121,519) (18,862) (22,691) 1,897 (14,811)
------------ ----------- ---------- ----------- ---------- ----------- ----------- -----------
Net realized and
unrealized gain
(loss) on
investments...... (69,541,076) 1,782,242 -- (617,413) 373,881 (427,725) (3,191,105) 8,131,215
------------ ----------- ---------- ----------- ---------- ----------- ----------- -----------
Net Increase
(Decrease) in Net
Assets Resulting
from Operations.. $(73,094,878) $ 1,535,662 $2,016,954 $(1,271,026) $ 152,045 $ (546,677) $(3,512,608) $ 7,705,500
============ =========== ========== =========== ========== =========== =========== ===========
<CAPTION>
U.S. Equity Venture
Government Growth International Value
Sub- Balanced Sub- Magnum Equity Sub-
Account Sub-Account Account Sub- Account Account
---------- ------------ ------------ ------------- ------------
<S> <C> <C> <C> <C> <C>
Income
Dividends........ $ -- $ -- $ -- $ -- $ --
Expense
Mortality and
expense risk
charge (Note 3).. 3,810 57,847 948,531 71,123 656,729
---------- ------------ ------------ ------------- ------------
Net investment
income (loss).... (3,810) (57,847) (948,531) (71,123) (656,729)
Net Realized and
Unrealized
Gain (Loss) on
Investments
Net unrealized
appreciation
(depreciation)
on investments:
Beginning of
period.......... (56,822) (1,387,395) 52,277,058 3,645,897 38,403,888
End of period... (31,423) (2,094,887) 63,534,553 3,342,978 50,794,304
---------- ------------ ------------ ------------- ------------
Net change in
unrealized
appreciation
(depreciation)... 25,399 (707,492) 11,257,494 (302,919) 12,390,417
Net realized
gain (loss) on
investments...... 32 77,593 (25,425) (4,300) (11,798)
---------- ------------ ------------ ------------- ------------
Net realized and
unrealized gain
(loss) on
investments...... 25,431 (629,899) 11,232,069 (307,219) 12,378,619
---------- ------------ ------------ ------------- ------------
Net Increase
(Decrease) in Net
Assets Resulting
from Operations.. $ 21,621 $ (687,746) $10,283,538 $ (378,342) $11,721,890
========== ============ ============ ============= ============
</TABLE>
* For the period May 1, 2000 (Commencement of Operations) through June 30,
2000.
See Notes to Financial Statements
138
<PAGE>
<TABLE>
<CAPTION>
New England Zenith Fund Metropolitan Series Fund Variable Insurance Products Fund
--------------------------------------- ------------------------------------------- ---------------------------------------
Large Russell*
Bond Cap* 2000
Opportunities Research Mid-Cap* Growth Index International* Equity-
Sub- Investors Managers Sub- Sub- Sub- stock Sub- Income Sub- Overseas High Income
Account Sub-Account Sub-Account Account Account Account Account Account Sub-Account Sub-Account
------------- ----------- ----------- -------- ------- -------- -------------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ -- $ -- $ -- $ -- $ -- $ -- $ -- $ 13,394,550 $ 16,105,748 $ 1,006,372
5,031 4,419 9,722 3,770 424 466 -- 505,228 517,312 52,081
--------- ----------- ----------- -------- ------- ------- ---- ------------ ------------ -----------
(5,031) (4,419) (9,722) (3,770) (424) (466) -- 12,889,322 15,588,436 954,291
(154,569) 20,670 138,291 -- -- -- -- 42,410,113 51,864,228 (919,900)
(141,707) (4,439,706) (4,020,596) 513,538 34,500 27,211 292 24,262,004 27,061,054 (2,681,292)
--------- ----------- ----------- -------- ------- ------- ---- ------------ ------------ -----------
12,864 (4,460,376) (4,158,887) 513,539 34,501 27,212 293 (18,148,109) (24,803,173) (1,761,392)
6,214 (662) (2,365) (399) (21) -- (28) (144,700) (11,100) 21,015
--------- ----------- ----------- -------- ------- ------- ---- ------------ ------------ -----------
19,078 (4,461,038) (4,161,252) 513,140 34,480 27,212 265 (18,292,809) (24,814,273) (1,740,377)
--------- ----------- ----------- -------- ------- ------- ---- ------------ ------------ -----------
$ 14,047 $(4,465,457) $(4,170,974) $509,370 $34,056 $26,746 $265 $ (5,403,487) $ (9,225,837) $ (786,086)
========= =========== =========== ======== ======= ======= ==== ============ ============ ===========
<CAPTION>
Variable
Insurance
Products
Fund II
--------------------------
Asset
Manager
Sub-Account Total
------------ -------------
<S> <C>
$ 1,452,323 $ 34,269,832
45,999 8,718,378
------------ -------------
1,406,324 25,551,454
1,757,628 433,502,392
187,832 338,481,686
------------ -------------
(1,569,795) (95,020,702)
21,546 (194,100)
------------ -------------
(1,548,249) (95,214,809)
------------ -------------
$ (141,925) $(69,663,355)
============ =============
</TABLE>
See Notes to Financial Statements
139
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Operations
For the Six Months Ended June 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
----------------------------------------------------------------------------------------------------
Growth
Capital Bond Money Stock Midcap and Small
Growth Income Market Index Managed Value Income Cap
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account
------------ ----------- ---------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Income
Dividends............. $ -- $ -- $2,302,260 $ -- $ -- $ -- $ -- $ --
Expense
Mortality and expense
risk charge (Note 3). 3,311,082 214,540 279,886 432,182 191,101 192,741 246,030 227,844
------------ ----------- ---------- ----------- ----------- ----------- ----------- ----------
Net investment income
(loss)............... (3,311,082) (214,540) 2,022,374 (432,182) (191,101) (192,741) (246,030) (227,844)
Net Realized and
Unrealized
Gain (Loss) on
Investments
Net unrealized
appreciation
(depreciation)
on investments:
Beginning of period... 215,969,495 1,209,273 -- 39,965,167 13,285,666 (3,807,527) 13,616,695 3,516,783
End of period......... 275,479,001 (34,566) -- 54,991,573 17,764,355 1,604,301 21,369,327 6,250,210
------------ ----------- ---------- ----------- ----------- ----------- ----------- ----------
Net change in
unrealized
appreciation
(depreciation)....... 59,509,506 (1,243,839) -- 15,026,406 4,478,689 5,411,828 7,752,632 2,733,427
Net realized gain
(loss) on
investments.......... (22,921) 992 -- 33,125 244,711 (13,860) 17,588 1,971
------------ ----------- ---------- ----------- ----------- ----------- ----------- ----------
Net realized and
unrealized gain
(loss)
on investments....... 59,486,585 (1,242,847) -- 15,059,531 4,723,400 5,397,968 7,770,220 2,735,398
------------ ----------- ---------- ----------- ----------- ----------- ----------- ----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations............ $ 56,175,503 $(1,457,387) $2,022,374 $14,627,349 $ 4,532,299 $ 5,205,227 $ 7,524,190 $2,507,554
============ =========== ========== =========== =========== =========== =========== ==========
</TABLE>
* For the period April 30, 1999 (Commencement of Operations) through June 30,
1999.
See Notes to Financial Statements
140
<PAGE>
<TABLE>
<CAPTION>
-------------------------------------------------------------- ---------------------------------
MFS*
U.S. Equity Venture Bond MFS* Research
Government Balanced Growth International Value Opportunities Investors Managers
Sub- Sub- Sub- Magnum Equity Sub- Sub- Sub- Sub-
Account Account Account Sub- Account Account Account Account Account
---------- ---------- ----------- ------------- ----------- ------------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
-- 46,863 408,608 38,884 398,526 -- -- --
-------- ---------- ----------- ---------- ----------- -------- -------- --------
-- (46,863) (408,608) (38,884) (398,526) -- -- --
15,209 1,036,991 30,707,168 194,954 20,008,648 (46,594) -- --
(20,556) 1,563,048 49,749,552 1,041,829 38,023,955 (68,398) 115,757 270,617
-------- ---------- ----------- ---------- ----------- -------- -------- --------
(35,765) 526,057 19,042,384 846,875 18,015,307 (21,804) 115,757 270,617
(929) 14,252 78,411 1,858 213,315 (927) (789) 250
-------- ---------- ----------- ---------- ----------- -------- -------- --------
(36,694) 540,309 19,120,795 848,733 18,228,622 (22,731) 114,968 270,867
-------- ---------- ----------- ---------- ----------- -------- -------- --------
$(36,694) $ 493,446 $18,712,187 $ 809,849 $17,830,096 $(22,731) $114,968 $270,867
======== ========== =========== ========== =========== ======== ======== ========
<CAPTION>
Variable
Insurance
Variable Insurance Products
Products Fund Fund II
------------------------------------------------------------
Equity- High Asset
Income Overseas Income Manager
Sub- Sub- Sub- Sub-
Account Account Account Account Total
----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
$ 7,478,140 $ 4,624,752 $1,147,254 $ 713,060 $ 16,265,466
458,897 306,394 37,927 33,938 6,825,443
----------- ----------- ----------- ----------- ------------
7,019,243 4,318,358 1,109,327 679,122 9,440,023
39,593,709 14,768,529 (611,552) 1,247,559 390,670,172
53,369,139 18,618,610 (976,653) 1,073,258 540,184,358
----------- ----------- ----------- ----------- ------------
13,775,430 3,850,081 (365,101) (174,301) 149,514,186
1,611,931 936,416 (46,738) 1,319 3,069,975
----------- ----------- ----------- ----------- ------------
15,387,361 4,786,497 (411,839) (172,982) 152,584,161
----------- ----------- ----------- ----------- ------------
$22,406,604 $ 9,104,855 $ 697,488 $ 506,140 $162,024,184
=========== =========== =========== =========== ============
</TABLE>
See Notes to Financial Statements
141
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Operations
For the Six Months Ended June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
------------------------------------------------------------------------------------------------
Capital Bond Money Stock Midcap Growth and Small
Growth Income Market Index Managed Value Income Cap
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account
------------ ---------- -------- ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Income
Dividends.............. $ -- $ -- $971,841 $ -- $ -- $ -- $ -- $ --
Expense
Mortality and expense
risk charge (Note 3).. 2,784,860 202,973 165,082 276,495 151,716 173,987 255,357 285,589
------------ ---------- -------- ----------- ----------- ---------- ----------- ----------
Net investment income
(loss)................ (2,784,860) (202,973) 806,759 (276,495) (151,716) (173,987) (255,357) (285,589)
Net Realized and
Unrealized Gain (Loss)
on Investments
Net unrealized
appreciation
(depreciation) on
investments:
Beginning of period.... 91,366,363 892,059 -- 19,889,059 9,447,437 6,964,381 6,858,665 5,422,058
End of period.......... 297,607,575 2,963,543 -- 32,074,188 14,803,761 9,268,170 14,428,308 6,794,304
------------ ---------- -------- ----------- ----------- ---------- ----------- ----------
Net change in
unrealized
appreciation
(depreciation)........ 206,241,212 2,071,484 -- 12,185,129 5,356,324 2,303,789 7,569,643 1,372,246
Net realized gain
(loss) on investments. 1,466,812 (68) -- 31,591 50,125 76,415 2,584 6,158
------------ ---------- -------- ----------- ----------- ---------- ----------- ----------
Net realized and
unrealized gain (loss)
on investments........ 207,708,024 2,071,416 -- 12,216,720 5,406,449 2,380,204 7,572,227 1,378,404
------------ ---------- -------- ----------- ----------- ---------- ----------- ----------
Net Increase (Decrease)
in Net Assets Resulting
from Operations........ $204,923,164 $1,868,443 $806,759 $11,940,225 $ 5,254,733 $2,206,217 $ 7,316,870 $1,092,815
============ ========== ======== =========== =========== ========== =========== ==========
</TABLE>
See Notes to Financial Statements
142
<PAGE>
<TABLE>
<CAPTION>
Variable
Insurance
Variable Insurance Products
Products Fund Fund II
---------- ----------------------------------------------------------------- ---------------------------------- ---------
U.S. Equity International Venture Bond Equity- High Asset
Government Balanced Growth Magnum Equity Value Opportunities Income Overseas Income Manager
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account Account Account
---------- ---------- ----------- ------------- ----------- ------------- ----------- ----------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ -- $ -- $ -- $ -- $ -- $ -- $ 8,088,940 $ 6,093,523 $1,064,286 $ 835,511
20,617 128,723 358,984 86,003 414,040 66,219 445,981 279,956 33,345 23,328
-------- ---------- ----------- ---------- ----------- -------- ----------- ----------- ---------- ---------
(20,617) (128,723) (358,984) (86,003) (414,040) (66,219) 7,642,959 5,813,567 1,030,941 812,183
(1,916) 642,612 5,391,267 (155,005) 10,716,783 (2,256) 32,699,163 11,137,299 964,520 971,097
5,865 1,185,532 19,216,205 1,388,469 18,647,606 20,352 37,913,096 17,413,048 330,148 761,729
-------- ---------- ----------- ---------- ----------- -------- ----------- ----------- ---------- ---------
7,781 542,920 13,824,938 1,543,474 7,930,823 22,608 5,213,933 6,275,749 (634,372) (209,368)
2 1,364 3,149 1,524 3,189 19 137,541 101,031 9,765 9
-------- ---------- ----------- ---------- ----------- -------- ----------- ----------- ---------- ---------
7,783 544,284 13,828,087 1,544,998 7,934,012 22,627 5,351,474 6,376,780 (624,607) (209,359)
-------- ---------- ----------- ---------- ----------- -------- ----------- ----------- ---------- ---------
$(12,834) $ 415,561 $13,469,103 $1,458,995 $ 7,519,972 $(43,592) $12,994,433 $12,190,347 $ 406,334 $ 602,824
======== ========== =========== ========== =========== ======== =========== =========== ========== =========
</TABLE>
------------
Total
------------
$ 17,054,101
6,153,255
------------
10,900,846
203,203,586
474,821,899
------------
271,618,313
1,891,210
------------
273,509,523
------------
$284,410,369
============
See Notes to Financial Statements
143
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Changes in Net Assets
For the Six Months Ended June 30, 2000
<TABLE>
<CAPTION>
New England Zenith Fund
--------------------------------------------------------------------------------------------------------------
Growth
Capital Stock Midcap and Small
Growth Bond Income Money Market Index Managed Value Income Cap
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account
-------------- ----------- ------------- ------------ ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
From Operating
Activities
Net investment
income (loss).... $ (3,553,802) $ (246,580) $ 2,016,954 $ (653,613) $ (221,836) $ (118,952) $ (321,503) $ (425,715)
Net realized and
unrealized gain
(loss) on
investments...... (69,541,076) 1,782,242 -- (617,413) 373,881 (427,725) (3,191,105) 8,131,215
-------------- ----------- ------------- ------------ ----------- ----------- ----------- ------------
Net increase
(decrease) in
net assets
resulting
from operations. (73,094,878) 1,535,662 2,016,954 (1,271,026) 152,045 (546,677) (3,512,608) 7,705,500
From Policy-
Related
Transactions
Net premiums
transferred from
New England Life
Insurance
Company
(Note 4)......... 67,876,159 6,212,323 109,814,307 18,950,701 6,010,682 3,410,544 9,269,201 10,020,412
Net transfers
(to) from other
sub-accounts..... (29,500,799) (3,196,017) (111,430,393) 12,490,740 (1,109,345) (1,944,157) 508,020 25,867,621
Net transfers
(to) from New
England Life
Insurance
Company.......... (66,588,669) (4,753,280) (72,609,032) (15,659,235) (4,781,559) (1,773,852) (1,049,349) (12,113,962)
-------------- ----------- ------------- ------------ ----------- ----------- ----------- ------------
Net Increase in
net assets
resulting from
policy related
transactions.... (28,213,310) (1,736,974) (74,225,118) 15,782,206 119,778 (307,464) 8,727,872 23,774,071
-------------- ----------- ------------- ------------ ----------- ----------- ----------- ------------
Net increase
(decrease) in
net assets....... (101,308,187) (201,312) (72,208,164) 14,511,180 271,823 (854,141) 5,215,264 31,479,571
Net Assets, at
beginning of the
period........... 1,146,703,380 68,040,407 136,769,883 164,522,069 64,170,231 33,493,352 85,110,312 89,052,664
-------------- ----------- ------------- ------------ ----------- ----------- ----------- ------------
Net Assets, at
end of the
period........... $1,045,395,191 $67,839,095 $ 64,561,719 $179,033,249 $64,442,054 $32,639,211 $90,325,576 $120,532,235
============== =========== ============= ============ =========== =========== =========== ============
<CAPTION>
U.S. Equity
Government Balanced Growth International
Sub- Sub- Sub- Magnum Equity
Account Account Account Sub- Account
---------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C>
From Operating
Activities
Net investment
income (loss).... $ (3,810) $ (57,847) $ (948,531) $ (71,123)
Net realized and
unrealized gain
(loss) on
investments...... 25,431 (629,899) 11,232,069 (307,219)
---------- ------------ ------------- -------------
Net increase
(decrease) in
net assets
resulting
from operations. 21,621 (687,746) 10,283,538 (378,342)
From Policy-
Related
Transactions
Net premiums
transferred from
New England Life
Insurance
Company
(Note 4)......... -- 1,974,382 25,358,073 2,009,583
Net transfers
(to) from other
sub-accounts..... (59,424) (1,274,489) 58,640,768 2,681,369
Net transfers
(to) from New
England Life
Insurance
Company.......... (595) (779,415) (11,357,110) (1,183,161)
---------- ------------ ------------- -------------
Net Increase in
net assets
resulting from
policy related
transactions.... (60,019) (79,522) 72,641,731 3,507,791
---------- ------------ ------------- -------------
Net increase
(decrease) in
net assets....... (38,398) (767,268) 82,925,269 3,129,449
Net Assets, at
beginning of the
period........... 757,310 15,289,368 198,645,578 16,218,546
---------- ------------ ------------- -------------
Net Assets, at
end of the
period........... $718,912 $14,522,100 $281,570,847 $19,347,995
========== ============ ============= =============
</TABLE>
* For the period May 1, 2000 (Commencement of Operations) through June 30,
2000.
See Notes to Financial Statements
144
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
For the Six Months Ended June 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
Metropolitan Series Fund
----------------------------------------------------- ----------------------------------------------
Large* Russell*
Venture Bond Cap 2000
Value Opportunities Research Mid-Cap* Growth Index International*
Sub- Sub- Investors Managers Sub- Sub- Sub- Stock Sub-
Account Account Sub-Account Sub-Account Account Account Account Account
------------ ------------- ----------- ----------- ---------- -------- -------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ (656,729) $ (5,031) $ (4,419) $ (9,722) $ (3,770) $ (424) $ (466) $ --
12,378,619 19,078 (4,461,038) (4,161,252) 513,140 34,480 27,212 265
------------ ---------- ----------- ----------- ---------- -------- -------- -------
11,721,890 14,047 (4,465,457) (4,170,974) 509,370 34,056 26,746 265
20,269,524 -- 188,497 367,898 143,213 17,315 9,906 --
24,986,853 (106,374) 786,881 4,024,385 6,560,309 873,288 548,968 41,986
(20,817,240) 1,327 4,458,382 3,888,085 (600,604) (129,774) 306,741 --
------------ ---------- ----------- ----------- ---------- -------- -------- -------
24,439,137 (105,047) 5,433,759 8,280,368 6,102,918 760,829 865,615 41,986
------------ ---------- ----------- ----------- ---------- -------- -------- -------
36,161,027 (91,000) 968,303 4,109,394 6,612,288 794,885 892,361 42,251
146,470,032 1,061,034 692,838 788,203 -- -- -- --
------------ ---------- ----------- ----------- ---------- -------- -------- -------
$182,631,059 $ 970,034 $ 1,661,141 $ 4,897,597 $6,612,288 $794,885 $892,361 $42,251
============ ========== =========== =========== ========== ======== ======== =======
<CAPTION>
Variable
Insurance
Products
Variable Insurance Products Fund Fund II
---------------------------------------- ------------ ---------------
Equity- Asset
Income Sub- Overseas High Income Manager
Account Sub-Account Sub-Account Sub-Account Total
------------- ------------- ------------ ------------ ---------------
<S> <C> <C> <C> <C>
$ 12,889,322 $ 15,588,436 $ 954,291 $ 1,406,324 $ 25,551,454
(18,292,809) (24,814,273) (1,740,377) (1,548,249) (95,214,809)
------------- ------------- ------------ ------------ ---------------
(5,403,487) (9,225,837) (786,086) (141,925) (69,663,355)
13,004,707 10,296,804 1,443,406 1,127,732 307,775,369
(9,279,231) 17,928,797 262,945 1,697,298 --
(8,182,242) 34,695,196 (790,737) (1,627,566) (181,447,654)
------------- ------------- ------------ ------------ ---------------
(4,456,766) 62,920,797 915,614 1,197,464 126,327,715
------------- ------------- ------------ ------------ ---------------
(9,860,253) 53,694,959 129,528 1,055,539 56,664,367
152,058,910 126,338,392 13,480,923 11,770,181 2,471,433,614
------------- ------------- ------------ ------------ ---------------
$142,198,657 $180,033,351 $13,610,451 $12,825,720 $2,528,097,981
============= ============= ============ ============ ===============
</TABLE>
See Notes to Financial Statements
145
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Changes in Net Assets
For the Six Months Ended June 30, 1999 (unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
---------------------------------------------------------------------------------
Capital Bond Money Stock Midcap
Growth Income Market Index Managed Value
Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account
-------------- ----------- ------------ ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
From Operating
Activities
Net investment
income (loss).. $ (3,311,082) $ (214,540) $ 2,022,374 $ (432,182) $ (191,101) $ (192,741)
Net realized and
unrealized gain
(loss) on
investments.... 59,486,585 (1,242,847) -- 15,059,531 4,723,400 5,397,968
-------------- ----------- ------------ ------------ ----------- -----------
Net increase
(decrease) in
net assets
resulting from
operations..... 56,175,503 (1,457,387) 2,022,374 14,627,349 4,532,299 5,205,227
From Policy-
Related
Transactions
Net premiums
transferred
from New
England Life
Insurance
Company
(Note 4)....... 69,661,120 6,207,119 89,198,640 13,620,891 5,649,915 3,388,153
Net transfers
(to) from other
sub-accounts... 9,776,517 7,007,489 (76,169,924) 17,687,461 3,296,437 (1,782,040)
Net transfers to
(from) New
England Life
Insurance
Company........ (77,330,034) (8,066,179) (5,681,230) (15,448,448) (6,012,588) (2,902,937)
-------------- ----------- ------------ ------------ ----------- -----------
Net Increase
(decrease) in
net assets
resulting from
policy related
transactions... 2,107,603 5,148,429 7,347,486 15,859,904 2,933,764 (1,296,824)
-------------- ----------- ------------ ------------ ----------- -----------
Net increase in
net assets..... 58,283,106 3,691,042 9,369,860 30,487,253 7,466,063 3,908,403
Net Assets, at
beginning of the
period.......... 974,704,592 57,816,044 85,330,924 100,709,791 53,249,987 32,711,062
-------------- ----------- ------------ ------------ ----------- -----------
Net Assets, at
end of the
period.......... $1,032,987,698 $61,507,086 $ 94,700,784 $131,197,044 $60,716,050 $36,619,465
============== =========== ============ ============ =========== ===========
<CAPTION>
-------------------------------------
Growth
and Small U.S.
Income Cap Government
Sub- Sub- Sub-
Account Account Account
------------ ------------ -----------
<S> <C> <C> <C>
From Operating
Activities
Net investment
income (loss).. $ (246,030) $ (227,844) $ ---
Net realized and
unrealized gain
(loss) on
investments.... 7,770,220 2,735,398 (36,694)
------------ ------------ -----------
Net increase
(decrease) in
net assets
resulting from
operations..... 7,524,190 2,507,554 (36,694)
From Policy-
Related
Transactions
Net premiums
transferred
from New
England Life
Insurance
Company
(Note 4)....... 7,516,046 9,037,307 --
Net transfers
(to) from other
sub-accounts... 9,658,225 (4,211,738) (86,921)
Net transfers to
(from) New
England Life
Insurance
Company........ (7,520,124) (5,601,369) 587,885
------------ ------------ -----------
Net Increase
(decrease) in
net assets
resulting from
policy related
transactions... 9,654,147 (775,800) 500,964
------------ ------------ -----------
Net increase in
net assets..... 17,178,337 1,731,754 464,270
Net Assets, at
beginning of the
period.......... 58,951,793 63,798,887 691,612
------------ ------------ -----------
Net Assets, at
end of the
period.......... $76,130,130 $65,530,641 $1,155,882
============ ============ ===========
</TABLE>
* For the period April 30, 1999 (Commencement of Operations) through June 30,
1999.
See Notes to Financial Statements
146
<PAGE>
<TABLE>
<CAPTION>
----------- ----------------------------------------------------------------------------
International Bond MFS*
Equity Magnum Venture Oppor- MFS* Research
Balanced Growth Equity Value tunities Investors Managers
Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account
----------- ------------ ------------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
$ (46,863) $ (408,608) $ (38,884) $ (398,526) $ -- $ -- $ --
540,309 19,120,795 848,733 18,228,622 (22,731) 114,968 270,867
----------- ------------ ----------- ------------ ---------- ---------- ----------
493,446 18,712,187 809,849 17,830,096 (22,731) 114,968 270,867
2,061,308 13,616,451 1,674,473 15,078,216 -- 5,000,867 5,005,249
1,294,388 27,827,472 556,511 8,503,261 20,487 104,592 88,526
(1,820,247) (15,796,107) 16,527,006 (18,742,427) 4,535,893 (115,124) (107,811)
----------- ------------ ----------- ------------ ---------- ---------- ----------
1,535,449 25,647,816 18,757,990 4,839,050 4,556,380 4,990,335 4,985,964
----------- ------------ ----------- ------------ ---------- ---------- ----------
2,028,895 44,360,003 19,567,839 22,669,146 4,533,649 5,105,303 5,256,831
12,476,648 90,873,849 10,318,556 95,272,468 1,090,654 -- --
----------- ------------ ----------- ------------ ---------- ---------- ----------
$14,505,543 $135,233,852 $29,886,395 $117,941,614 $5,624,303 $5,105,303 $5,256,831
=========== ============ =========== ============ ========== ========== ==========
<CAPTION>
Variable Variable
Insurance Insurance
Products Products
Fund Fund II
--------------------------------------- --------- ---------------
Equity- High Asset
Income Overseas Income Manager
Sub- Sub- Sub- Sub-
Account Account Account Account Total
------------- ------------ ------------ ------------ ---------------
<S> <C> <C> <C> <C>
$ 7,019,243 $ 4,318,358 $ 1,109,327 $ 679,122 $ 9,440,023
15,387,361 4,786,497 (411,839) (172,982) 152,584,161
------------- ------------ ------------ ------------ ---------------
22,406,604 9,104,855 697,488 506,140 162,024,184
13,735,230 8,419,606 1,730,200 1,038,381 271,639,172
(2,922,186) (2,711,707) 775,727 1,287,423 --
(16,968,471) (9,693,102) (1,693,729) (1,498,149) (173,347,291)
------------- ------------ ------------ ------------ ---------------
(6,155,427) (3,985,203) 812,198 827,655 98,291,881
------------- ------------ ------------ ------------ ---------------
16,251,177 5,119,652 1,509,686 1,333,795 260,316,065
138,553,401 84,273,799 9,988,955 8,187,191 1,879,000,212
------------- ------------ ------------ ------------ ---------------
$154,804,578 $89,393,451 $11,498,641 $ 9,520,986 $2,139,316,277
============= ============ ============ ============ ===============
</TABLE>
See Notes to Financial Statements
147
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Statement of Changes in Net Assets
For the Six Months Ended June 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
New England Zenith Fund
--------------------------------------------------------------------------------------------------------
Capital Bond Money Stock Midcap Growth and Small
Growth Income Market Index Managed Value Income Cap
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account
------------ ----------- ------------ ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
From Operating
Activities
Net investment
income (loss).. $ (2,784,860) $ (202,973) $ 806,759 $ (276,495) $ (151,716) $ (173,987) $ (255,357) $ (285,589)
Net realized and
unrealized gain
(loss) on
investments.... 207,708,024 2,071,416 -- 12,216,720 5,406,449 2,380,204 7,572,227 1,378,404
------------ ----------- ------------ ----------- ----------- ----------- ----------- -----------
Net increase
(decrease) in
net assets
resulting from
operations 204,923,164 1,868,443 806,759 11,940,225 5,254,733 2,206,217 7,316,870 1,092,815
From Policy-
Related
Transactions
Net premiums
transferred
from New
England Life
Insurance
Company (Note
4)............. 62,883,281 4,994,275 77,657,596 6,651,086 3,106,834 4,053,663 4,395,263 8,349,967
Net transfers
(to) from other
sub-accounts... 7,597,936 2,658,086 (65,923,334) 11,634,135 1,537,321 260,118 6,395,728 6,579,519
Net transfers to
(from) New
England Life
Insurance
Company........ (70,486,790) (3,001,883) (8,236,024) (8,692,565) (3,175,227) (2,189,457) (4,042,105) (4,660,182)
------------ ----------- ------------ ----------- ----------- ----------- ----------- -----------
Net Increase
(decrease) in
net assets
resulting from
policy related
transactions... (5,573) 4,650,478 3,498,238 9,592,656 1,468,928 2,124,324 6,748,886 10,269,304
------------ ----------- ------------ ----------- ----------- ----------- ----------- -----------
Net increase in
net assets..... 204,917,591 6,518,921 4,304,997 21,532,881 6,723,661 4,330,541 14,065,756 11,362,119
Net Assets, at
beginning of the
period.......... 691,641,608 41,515,700 33,105,424 57,550,836 38,540,384 31,066,603 31,767,670 47,510,435
------------ ----------- ------------ ----------- ----------- ----------- ----------- -----------
Net Assets, at
end of the
period.......... $896,559,199 $48,034,621 $ 37,410,421 $79,083,717 $45,264,045 $35,397,144 $45,833,426 $58,872,554
============ =========== ============ =========== =========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements
148
<PAGE>
<TABLE>
<CAPTION>
Variable
Insurance
Variable Insurance Products
Products Fund Fund II
---------- ------------------------------------------------------------------ ------------------------------------- ----------
International
U.S. Equity Magnum Venture Bond Equity- High Asset
Government Balanced Growth Equity Value Opportunities Income Overseas Income Manager
Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub- Sub-
Account Account Account Account Account Account Account Account Account Account
---------- ---------- ----------- ------------- ------------ ------------- ------------ ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ (20,617) $ (128,723) $ (358,984) $ (86,003) $ (414,040) $ (66,219) $ 7,642,959 $ 5,813,567 $1,030,941 $ 812,183
7,783 544,284 13,828,087 1,544,998 7,934,012 22,627 5,351,474 6,376,780 (624,607) (209,359)
---------- ---------- ----------- ---------- ------------ ---------- ------------ ----------- ---------- ----------
(12,834) 415,561 13,469,103 1,458,995 7,519,972 (43,592) 12,994,433 12,190,347 406,334 602,824
-- 1,421,932 8,555,151 1,469,538 10,658,400 -- 12,774,065 8,647,052 1,072,687 917,268
150,047 1,509,132 4,631,921 362,342 15,033,152 535,135 4,704,188 267,955 1,650,296 416,323
797,327 (810,983) (6,492,859) (861,730) (11,013,992) 1,991,149 (9,433,534) (6,471,362) (886,540) (633,643)
---------- ---------- ----------- ---------- ------------ ---------- ------------ ----------- ---------- ----------
947,374 2,120,081 6,694,213 970,150 14,677,560 2,526,284 8,044,719 2,443,645 1,836,443 699,948
---------- ---------- ----------- ---------- ------------ ---------- ------------ ----------- ---------- ----------
934,540 2,535,642 20,163,316 2,429,145 22,197,532 2,482,692 21,039,152 14,633,992 2,242,777 1,302,772
161,183 6,875,248 41,937,060 7,133,037 51,416,733 587,737 107,331,321 67,825,320 7,180,273 5,448,878
---------- ---------- ----------- ---------- ------------ ---------- ------------ ----------- ---------- ----------
$1,095,723 $9,410,890 $62,100,376 $9,562,182 $ 73,614,265 $3,070,429 $128,370,473 $82,459,312 $9,423,050 $6,751,650
========== ========== =========== ========== ============ ========== ============ =========== ========== ==========
</TABLE>
---------------
Total
---------------
$ 10,900,846
273,509,523
---------------
284,410,369
217,608,058
--
(138,300,400)
---------------
79,307,658
---------------
363,718,027
1,268,595,450
---------------
$1,632,313,477
===============
See Notes to Financial Statements
149
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Notes to Financial Statements
1. Nature of Business. New England Variable Life Separate Account (the
"Account") of New England Life Insurance Company ("NELICO") was established by
NELICO's Board of Directors on January 31, 1983 in accordance with the
regulations of the Delaware Insurance Department and is now operating in
accordance with the regulations of the Commonwealth of Massachusetts Division
of Insurance. The Account is registered as a unit investment trust under the
Investment Company Act of 1940. The assets of the Account are owned by NELICO.
The net assets of the Account are restricted from use in the ordinary business
of NELICO. NELICO is an indirect wholly-owned subsidiary of Metropolitan Life
Insurance Company ("MetLife"). MetLife is a wholly-owned subsidiary of
MetLife, Inc., a publicly traded company.
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 disclosures 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.
2. Sub-Accounts. The Account has twenty-four investment sub-accounts each of
which invest in the shares of one portfolio of the New England Zenith Fund
("Zenith Fund"), the Metropolitan Series Fund, Inc., the Variable Insurance
Products Fund or the Variable Insurance Products Fund II. The portfolios of
the Zenith Fund, the Metropolitan Series Fund, Inc., the Variable Insurance
Products Fund and the Variable Insurance Products Fund II in which the sub-
accounts invest are referred to herein as the "Eligible Funds". The Zenith
Fund, Metropolitan Series Fund, Inc., the Variable Insurance Products Fund and
the Variable Insurance Products Fund II are open-end management investment
companies. The Account purchases or redeems shares of the Eligible Funds based
on the amount of net premiums invested in the Account, transfers among the
sub-accounts, policy loans, surrender payments, and death benefit payments.
The values of the shares of the Eligible Funds are determined as of the close
of the New York Stock Exchange (normally 4:00 p.m. EST) on each day the
Exchange is open for trading. Realized gains and losses on the sale of
Eligible Funds' shares are computed on the basis of identified cost on the
trade date. Income from dividends is recorded on the ex-dividend date. Charges
for investment advisory fees and other expenses are reflected in the carrying
value of the assets of the Eligible Funds.
3. Mortality and Expense Risk Charges. NELICO charges the Account for the
mortality and expense risk NELICO assumes. The mortality risk assumed by
NELICO is the risk that insureds may live for shorter periods of time than
NELICO estimated when setting its cost of insurance charges. The expense risk
assumed by NELICO is the risk that the deductions for sales and administrative
charges may prove insufficient to cover actual cost. If these deductions are
insufficient to cover the cost of the mortality and expense risk assumed by
NELICO, NELICO absorbs the resulting losses and makes sufficient transfers to
the Fund from its general assets. Conversely, if those deductions are more
than sufficient after the establishment of any contingency reserves deemed
prudent or required by law, the excess is retained by NELICO. Under some
versions of the policies the charge is assessed daily against Account assets
and under others it is deducted monthly from policy cash values. The rate of
the charge varies by policy version.
4. Net Premium Transfers and Deductions from Cash Value. Certain deductions
are made from each premium payment paid to NELICO to arrive at a net premium
that is transferred to the Account. Certain deductions are made from cash
value in the sub-accounts. These deductions, depending on the policy, could
include sales load, administrative charges, premium tax charges, risk charges,
cost of insurance charges, and charges for rider benefits and special risk
charges.
5. Federal Income Taxes. For federal income tax purposes the Account's
operations are included with those of NELICO. NELICO intends to make
appropriate charges against the Account in the future if and when tax
liabilities arise.
150
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Notes to Financial Statements--(Continued)
6. Investment Advisers. The adviser and sub-adviser for each series of the
Zenith Fund are listed in the chart below. New England Investment Management,
Inc. (formerly, TNE Advisers, Inc.), which is an indirect subsidiary of
NELICO, Capital Growth Management Limited Partnership ("CGM"), and each of the
sub-advisers are registered with the Securities and Exchange Commission as
investment advisers under the Investment Advisers Act of 1940.
<TABLE>
<CAPTION>
Series Adviser Sub-Adviser
------ --------------------------------------- --------------------------------
<S> <C> <C>
Capital Growth CGM* --
Back Bay Advisors Money
Market New England Investment Management, Inc. Back Bay Advisors, L.P.*
Back Bay Advisors Bond
Income New England Investment Management, Inc. Back Bay Advisors, L.P.*
Back Bay Advisors
Managed New England Investment Management, Inc. Back Bay Advisors, L.P.*
Westpeak Stock Index Westpeak Investment Advisors,
New England Investment Management, Inc. L.P.*
Westpeak Growth and Westpeak Investment Advisors,
Income New England Investment Management, Inc. L.P.*
Harris Oakmark Mid Cap
Value New England Investment Management, Inc. Harris Associates L.P.*
Loomis Sayles Small Cap New England Investment Management, Inc. Loomis, Sayles & Company, L.P.*
Balanced Wellington Management Company,
New England Investment Management, Inc. LLP
Morgan Stanley
International Magnum New England Investment Management, Inc. Morgan Stanley Dean Witter
Equity Investment Management Inc.
Davis Venture Value New England Investment Management, Inc. Davis Selected Advisers, L.P.
Alger Equity Growth New England Investment Management, Inc. Fred Alger Management, Inc.
Salomon Brothers U.S. Salomon Brothers Asset
Government New England Investment Management, Inc. Management Inc
Salomon Brothers
Strategic Bond Salomon Brothers Asset
Opportunities New England Investment Management, Inc. Management Inc
MFS Investors Massachusetts Financial Services
New England Investment Management, Inc. Company
MFS Research Managers Massachusetts Financial Services
New England Investment Management, Inc. Company
</TABLE>
* An affiliate of NELICO
The Harris Oakmark Mid Cap Value Series' sub-adviser was Loomis Sayles until
May 1, 1998, when Goldman Sachs Asset Management, a separate operating
division of Goldman Sachs & Co. became the sub-adviser. Harris Associates
became the sub-adviser on May 1, 2000. The Balanced Series' sub-adviser was
Loomis Sayles until May 1, 2000, when Wellington Management Company became
sub-adviser.
Metropolitan Life Insurance Company is investment adviser for the Metropolitan
Series Fund Portfolios. Putnam Investment Management, Inc. is the sub-
investment manager of the Putnam Large Cap Growth Portfolio and the Putnam
International Stock Portfolio. Janus Capital Corporation is the sub-investment
manager of the Janus Mid Cap Portfolio.
Fidelity Management & Research Company is the investment adviser for the
Variable Insurance Products Fund and Variable Insurance Products Fund II.
151
<PAGE>
New England Variable Life Separate Account of
New England Life Insurance Company
Notes to Financial Statements--(Continued)
7. Investment Purchases and Sales. The following table shows the aggregate
cost of Eligible Fund shares purchased and proceeds from the sales of Eligible
Fund shares for each sub-account for the six months ended June 30, 2000:
<TABLE>
<CAPTION>
Purchases Sales
------------ ------------
<S> <C> <C>
Capital Growth Series $119,378,688 $157,635,711
Back Bay Advisors Money Market Series 169,558,961 247,189,755
Back Bay Advisors Bond Income Series 15,231,620 17,532,861
Back Bay Advisors Managed Series 11,487,486 11,116,143
Westpeak Stock Index Series 54,692,857 36,852,066
Westpeak Growth and Income Series 21,554,836 16,918,012
Harris Oakmark Midcap Value Series 7,672,459 8,207,627
Loomis Sayles Small Cap Series 45,738,922 17,664,301
Balanced Series 4,669,110 5,496,310
Morgan Stanley International Magnum Equity Series 8,254,332 4,464,561
Davis Venture Value Series 60,945,466 27,686,551
Alger Equity Growth Series 119,376,565 34,651,313
Salomon Bothers U.S. Government Series 474,592 542,916
Salomon Bothers Strategic Bond Opportunities
Series 348,546 466,811
MFS Investors Series 1,357,826 269,464
MFS Research Managers Series 4,975,647 695,959
Putnam International Stock Portfolio* 41,986 --
Putnam Large Cap Growth Portfolio* 901,746 10,719
Janus Mid Cap Portfolio* 7,059,490 170,957
Russell 2000 Index Portfolio* 935,359 4,814
VIP Equity-Income Portfolio 23,199,762 28,937,980
VIP Overseas Portfolio 86,046,720 20,744,719
VIP High Income Portfolio 4,552,528 3,591,301
VIP II Asset Manager Portfolio 5,262,174 3,983,574
</TABLE>
* For the period May 1, 2000 (Commencement of Operations) to June 30, 2000.
152
<PAGE>
PRSRT STD
[LOGO OF NEW ENGLAND FINANCIAL] U.S.
POSTAGE
PAID
LANCASTER,
PA PERMIT
1403
NEW ENGLAND LIFE INSURANCE COMPANY
501 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02116
EQUAL OPPORTUNITY EMPLOYER M/F
(C) 2000 NEW ENGLAND LIFE INSURANCE COMPANY
--------------------------------------------------------------------------------
This booklet has been prepared for variable contract owners of
New England Life Insurance Company, Boston, MA.
VL VIP
