<PAGE>
INVESTING
[Eaton Vance Logo] FOR THE [Picture of the earth]
21st
CENTURY-Registered Trademark-
SEMIANNUAL REPORT APRIL 30, 2000
EATON VANCE
STRATEGIC
[Picture of bonds] INCOME
FUND
[Eaton Vance 75th Anniversary Logo]
[Picture of buildings]
<PAGE>
EATON VANCE STRATEGIC INCOME FUND as of April 30, 2000
INVESTMENT UPDATE
[PHOTO]
MARK S. VENEZIA PORTFOLIO MANAGER
INVESTMENT ENVIRONMENT
--------------------------------------------------------------------------------
THE GLOBAL BOND MARKETS
- The six months ended April 30, 2000 featured interest rate hikes by the
Federal Reserve and a continuing structural shift in the U.S. bond markets.
Indicative of that trend, quality spreads for U.S. government agency bonds
- already wide a year ago-grew even wider in the past six months.
- The dramatic variance of returns among multi-market segments has made
global diversification an increasingly important consideration. Emerging
market bonds significantly outperformed U.S. Treasuries, U.S. high-yield
corporates and foreign government bonds during the period.
- The U.S. high-yield corporate market reflected the continuing shift from
old economy to new economy. Accordingly, telecom and cable companies posted
generally better returns - and greater volatility - than their older,
industrial counterparts.
THE FUND
--------------------------------------------------------------------------------
PERFORMANCE FOR THE PAST SIX MONTHS
- The Fund's Class A shares had a total return of 3.22% during the six months
ended April 30, 2000.(1) This return resulted from a decrease in net asset
value per share (NAV) to $8.98 on April 30, 2000 from $9.11 on October 31,
1999, and the reinvestment of $0.422 in dividend income.
- The Fund's Class B shares had a total return of 2.80% during the six months
ended April 30, 2000.(1) This return resulted from a decrease in net asset
value per share (NAV) to $8.49 on April 30, 2000 from $8.61 on October 31,
1999 and the reinvestment of $0.360 in dividend income.
- The Fund's Class C shares had a total return of 2.83% during the six months
ended April 30, 2000.(1) This return resulted from a decrease in NAV to
$10.72 on April 30, 2000 from $10.87 on October 31, 1999 and the
reinvestment of $0.457 in dividend income.
RECENT PORTFOLIO DEVELOPMENTS
- The Fund outperformed the 1.24% average return of its Multi Sector Income
Fund Classification peer group during the six months ended April 30, 2000,
according to Lipper Inc., a nationally recognized monitor of mutual fund
performance.(2)
- The Portfolio was characterized during the period by a modest shift into
the emerging markets, particularly into Poland, Taiwan and Brazil. The
Portfolio's position in mortgage-backed securities (MBS) declined from
39.0% at October 31, 1999 to 31.9% at April 30, 2000. U.S. high-yield bonds
also represented a slightly lower weighting at April 30.
- The Portfolio's investment-grade corporate bonds provided exceptional
income opportunities in high-quality investments during the period. With
quality spreads having widened during the period, holdings such as Ford
Motor Co., AT&T and Motorola, represented unusually good values by
historical standards.
- The Portfolio increased its exposure to Asia, which has recovered
significantly from the crisis of 1998-99. The Portfolio's investments
targeted technology companies, including Macronix International Ltd., a
Taiwan-based manufacturer of semiconductors. Macronix enjoyed 40% revenue
growth in 1999 and is expanding production capacity to meet a growing
demand for its specialty chips.
- The Portfolio shifted its exposure from high-flying Mexico to Brazil, whose
economy has rebounded since its currency devaluation in January 1999. Under
the guidance of President Cardoso, the current administration has made
significant progress with its fiscal reforms, easily meeting IMF-mandated
fiscal and inflation targets.
- In Eastern Europe, the Portfolio established a position in Polish
government bonds. Political observers believe there is a strong possibility
that Poland will be admitted into the European Economic Union, yet the
bonds offered a 700 basis point (7.0%) yield advantage over similar
maturity U.S. Treasury bonds.
--------------------------------------------------------------------------------
MUTUAL FUND SHARES ARE NOT INSURED BY THE FDIC AND ARE NOT DEPOSITS OR OTHER
OBLIGATIONS OF, OR GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE SUBJECT
TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL INVESTED. YIELD WILL
VARY.
FUND INFORMATION
as of April 30, 2000
<TABLE>
<CAPTION>
Performance(3) Class A Class B Class C
--------------------------------------------------------------------------------
Average Annual Total Returns (at net asset value)
--------------------------------------------------------------------------------
<S> <C> <C> <C>
One Year 3.28% 2.34% 2.29%
Five Years N.A. 9.29 9.01
Life of Fund+ 4.48 6.34 8.22
SEC Average Annual Total Returns (including sales charge or applicable CDSC)
--------------------------------------------------------------------------------
<S> <C> <C> <C>
One Year -1.67% -2.37% 1.34%
Five Years N.A. 9.01 9.01
Life of Fund 2.26 6.34 8.22
</TABLE>
+Inception Dates - Class A: 1/23/98; Class B: 11/26/90; Class C:5/25/94
[CHART]
REGIONAL WEIGHTINGS(4)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
U.S. Investment Grade 51.9%
U.S. High Yield 21.1%
Asia 9.2%
Europe 8.3%
Latin America 9.5%
</TABLE>
(1) These returns do not include the 4.75% maximum sales charge for the Fund's
Class A shares or the applicable contingent deferred sales charges (CDSC)
for the Fund's Class B and Class C shares. (2) It is not possible to invest
directly in an Index or a Lipper Classification. (3) Returns are calculated
by determining the percentage change in net asset value with all
distributions reinvested. SEC average annual returns for Class A reflect a
4.75% sales charge; for Class B, returns reflect applicable CDSC based on
the following schedule: 5%-1st and 2nd years; 4%-3rd year; 3%-4th year;
2%-5th year; 1%-6th year; One-year SEC return for Class C reflects a 1%
CDSC. (4) By total investments - Weightings reflect the Fund's investment
in Strategic Income Portfolio (holdings described beginning on page 12) and
a 21.0% investment in High Income Portfolio. Because the Portfolio is
actively managed, Regional Weightings are subject to change.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost.
2
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
FINANCIAL STATEMENTS (UNAUDITED)
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF APRIL 30, 2000
<S> <C>
Assets
------------------------------------------------------
Investment in Strategic Income
Portfolio, at value
(identified cost, $164,555,697) $160,295,790
Investment in High Income Portfolio, at
value
(identified cost, $43,863,366) 41,366,943
Receivable for Fund shares sold 1,192,406
------------------------------------------------------
TOTAL ASSETS $202,855,139
------------------------------------------------------
Liabilities
------------------------------------------------------
Dividends payable $ 727,462
Payable for Fund shares redeemed 372,784
Payable to affiliate for service fees 25,446
Payable to affiliate for Trustees' fees 1,097
Accrued expenses 90,594
------------------------------------------------------
TOTAL LIABILITIES $ 1,217,383
------------------------------------------------------
NET ASSETS $201,637,756
------------------------------------------------------
Sources of Net Assets
------------------------------------------------------
Paid-in capital $224,311,090
Accumulated net realized loss from
Portfolio (computed on the basis of
identified cost) (16,880,772)
Accumulated undistributed net
investment income 963,768
Net unrealized depreciation from
Portfolio (computed on the basis of
identified cost) (6,756,330)
------------------------------------------------------
TOTAL $201,637,756
------------------------------------------------------
Class A Shares
------------------------------------------------------
NET ASSETS $ 8,163,113
SHARES OUTSTANDING 908,604
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 8.98
MAXIMUM OFFERING PRICE PER SHARE
(100 DIVIDED BY 95.25 of $8.98) $ 9.43
------------------------------------------------------
Class B Shares
------------------------------------------------------
NET ASSETS $157,671,040
SHARES OUTSTANDING 18,562,956
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 8.49
------------------------------------------------------
Class C Shares
------------------------------------------------------
NET ASSETS $ 35,803,603
SHARES OUTSTANDING 3,338,802
NET ASSET VALUE, OFFERING PRICE AND
REDEMPTION PRICE PER SHARE (NOTE 6)
(net assets DIVIDED BY shares of
beneficial interest outstanding) $ 10.72
------------------------------------------------------
</TABLE>
On sales of $25,000 or more, the offering price of Class A shares is reduced.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
APRIL 30, 2000
<S> <C>
Investment Income
-----------------------------------------------------
Interest allocated from Portfolios $ 9,177,148
Dividends allocated from Portfolios 308,451
Expenses allocated from Portfolios (812,228)
-----------------------------------------------------
NET INVESTMENT INCOME FROM PORTFOLIOS $ 8,673,371
-----------------------------------------------------
Expenses
-----------------------------------------------------
Trustees fees and expenses $ 3,058
Distribution and service fees
Class A 5,184
Class B 768,458
Class C 160,636
Transfer and dividend disbursing agent
fees 105,543
Legal and accounting services 32,397
Printing and postage 20,159
Registration fees 15,723
Custodian fee 14,630
Miscellaneous 24,356
-----------------------------------------------------
TOTAL EXPENSES $ 1,150,144
-----------------------------------------------------
NET INVESTMENT INCOME $ 7,523,227
-----------------------------------------------------
Realized and Unrealized
Gain (Loss) from Portfolios
-----------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 1,960,447
Financial futures contracts (360,143)
Foreign currency and forward foreign
currency exchange
contract transactions 722,176
-----------------------------------------------------
NET REALIZED GAIN $ 2,322,480
-----------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $(5,370,032)
Financial futures contracts 50,692
Foreign currency and forward foreign
currency exchange contracts 783,444
-----------------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) $(4,535,896)
-----------------------------------------------------
NET REALIZED AND UNREALIZED LOSS $(2,213,416)
-----------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 5,309,811
-----------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
FINANCIAL STATEMENTS (UNAUDITED) CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
INCREASE (DECREASE) APRIL 30, 2000 YEAR ENDED
IN NET ASSETS (UNAUDITED) OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------
From operations --
Net investment income $ 7,523,227 $ 14,891,288
Net realized gain (loss) 2,322,480 (8,489,980)
Net change in unrealized
appreciation (depreciation) (4,535,896) 5,769,593
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 5,309,811 $ 12,170,901
----------------------------------------------------------------------------
Distributions to shareholders --
From net investment income
Class A $ (316,520) $ (336,914)
Class B (6,508,901) (11,738,650)
Class C (1,312,370) (1,942,599)
In excess of net investment income
Class A (568) --
Tax return of capital
Class A -- (22,890)
Class B -- (797,540)
Class C -- (131,983)
----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS $ (8,138,359) $ (14,970,576)
----------------------------------------------------------------------------
Transactions in shares of beneficial interest --
Proceeds from sale of shares
Class A $ 2,828,454 $ 4,478,258
Class B 17,896,205 40,594,578
Class C 9,418,411 15,813,624
Net asset value of shares issued to
shareholders in payment of
distributions declared
Class A 199,676 237,539
Class B 2,170,729 4,915,690
Class C 660,690 1,141,637
Cost of shares redeemed
Class A (792,836) (549,826)
Class B (15,958,443) (26,086,695)
Class C (4,657,140) (5,065,992)
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM FUND
SHARE TRANSACTIONS $ 11,765,746 $ 35,478,813
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 8,937,198 $ 32,679,138
----------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 YEAR ENDED
NET ASSETS (UNAUDITED) OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------------
At beginning of period $ 192,700,558 $ 160,021,420
----------------------------------------------------------------------------------
AT END OF PERIOD $ 201,637,756 $ 192,700,558
----------------------------------------------------------------------------------
Accumulated undistributed
net investment income
included in net assets
----------------------------------------------------------------------------------
AT END OF PERIOD $ 963,768 $ 1,578,900
----------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
------------------------------------------
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 2000 ----------------------
(UNAUDITED) 1999(1) 1998(2)
<S> <C> <C> <C>
----------------------------------------------------------------------------
Net asset value -- Beginning
of period $ 9.110 $ 9.220 $10.000
----------------------------------------------------------------------------
Income (loss) from operations
----------------------------------------------------------------------------
Net investment income $ 0.391 $ 0.852 $ 0.668
Net realized and unrealized
loss (0.099) (0.095) (0.767)
----------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 0.292 $ 0.757 $(0.099)
----------------------------------------------------------------------------
Less distributions
----------------------------------------------------------------------------
From net investment income $(0.421) $(0.819) $(0.654)
In excess of net investment
income (0.001) -- (0.027)
Tax return of capital -- (0.048) --
----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $(0.422) $(0.867) $(0.681)
----------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $ 8.980 $ 9.110 $ 9.220
----------------------------------------------------------------------------
TOTAL RETURN(3) 3.22% 8.40% (1.29)%
----------------------------------------------------------------------------
Ratios/Supplemental Data
----------------------------------------------------------------------------
Net assets, end of period
(000's omitted) $ 8,163 $ 6,050 $ 2,009
Ratios (As a percentage of
average daily net assets):
Expenses(4) 1.22%(5) 1.08% 1.03%(5)
Net investment income 8.51%(5) 9.20% 8.44%(5)
Portfolio Turnover of the
Portfolio 27% 47% 71%
----------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) For the period from the commencement of offering of Class A shares,
January 23, 1998, to October 31, 1998.
(3) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(4) Includes the Fund's share of the Portfolios' allocated expenses.
(5) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
EATON VANCE STRATEGIC INCOME FUND (CONTINUED) AS OF APRIL 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS B
---------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 2000 -------------------------------------------------------------
(UNAUDITED) 1999(1) 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------------------------------------
Net asset value -- Beginning
of period $ 8.610 $ 8.720 $ 9.470 $ 9.310 $ 8.500 $ 8.290
-------------------------------------------------------------------------------------------------------------------
Income (loss) from operations
-------------------------------------------------------------------------------------------------------------------
Net investment income $ 0.331 $ 0.731 $ 0.684 $ 0.657 $ 0.655 $ 0.726
Net realized and unrealized
gain (loss) (0.091) (0.105) (0.686) 0.288 0.858 0.167
-------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 0.240 $ 0.626 $ (0.002) $ 0.945 $ 1.513 $ 0.893
-------------------------------------------------------------------------------------------------------------------
Less distributions
-------------------------------------------------------------------------------------------------------------------
From net investment income $ (0.360) $ (0.688) $ (0.748) $ (0.657) $ (0.655) $ (0.361)
In excess of net investment
income -- -- -- (0.128) (0.048) --
Tax return of capital -- (0.048) -- -- -- (0.322)
-------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $ (0.360) $ (0.736) $ (0.748) $ (0.785) $ (0.703) $ (0.683)
-------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $ 8.490 $ 8.610 $ 8.720 $ 9.470 $ 9.310 $ 8.500
-------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(2) 2.80% 7.32% (0.20)% 10.44% 18.48% 11.34%
-------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
-------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(000's omitted) $157,671 $155,768 $138,495 $130,596 $129,671 $150,767
Ratios (As a percentage of
average daily net assets):
Expenses(3) 2.02%(4) 1.96% 1.96% 2.08% 2.17% 2.18%
Net investment income 7.64%(4) 8.31% 7.40% 6.91% 7.38% 7.85%
Portfolio Turnover of the
Portfolio 27% 47% 71% 77% 71% 78%
-------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the Portfolios' allocated expenses.
(4) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
EATON VANCE STRATEGIC INCOME FUND (CONTINUED) AS OF APRIL 30, 2000
FINANCIAL STATEMENTS CONT'D
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS C
------------------------------------------
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 2000 ----------------------
(UNAUDITED) 1999(1) 1998
<S> <C> <C> <C>
----------------------------------------------------------------------------
Net asset value -- Beginning
of period $10.870 $11.010 $11.950
----------------------------------------------------------------------------
Income (loss) from operations
----------------------------------------------------------------------------
Net investment income $ 0.416 $ 0.912 $ 0.869
Net realized and unrealized
loss (0.116) (0.132) (0.872)
----------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
OPERATIONS $ 0.300 $ 0.780 $(0.003)
----------------------------------------------------------------------------
Less distributions
----------------------------------------------------------------------------
From net investment income $(0.450) $(0.872) $(0.884)
In excess of net investment
income -- -- (0.053)
Tax return of capital -- (0.048) --
----------------------------------------------------------------------------
TOTAL DISTRIBUTIONS $(0.450) $(0.920) $(0.937)
----------------------------------------------------------------------------
NET ASSET VALUE -- END OF
PERIOD $10.720 $10.870 $11.010
----------------------------------------------------------------------------
TOTAL RETURN(2) 2.83% 7.23% (0.15)%
----------------------------------------------------------------------------
Ratios/Supplemental Data
----------------------------------------------------------------------------
Net assets, end of period
(000's omitted) $35,804 $30,882 $19,518
Ratios (As a percentage of
average daily net assets):
Expenses(3) 2.04%(4) 2.03% 2.03%
Net investment income 7.57%(4) 8.22% 7.37%
Portfolio Turnover of the
Portfolio 27% 47% 71%
----------------------------------------------------------------------------
</TABLE>
(1) Net investment income per share was computed using average shares
outstanding.
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed
reinvested at the net asset value on the reinvestment date. Total return
is not computed on an annualized basis.
(3) Includes the Fund's share of the Portfolios' allocated expenses.
(4) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1 Significant Accounting Policies
-------------------------------------------
Eaton Vance Strategic Income Fund (the Fund) is a non-diversified series of
Eaton Vance Mutual Funds Trust (the Trust). The Fund is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company. The Fund offers three classes of shares. Class A shares
are generally sold subject to a sales charge imposed at the time of purchase.
Class B and Class C shares are sold at net asset value and are generally
subject to a contingent deferred sales charge (see Note 6). Each class
represents a pro rata interest in the Fund, but votes separately on
class-specific matters and (as noted below) is subject to different expenses.
Realized and unrealized gains and losses are allocated daily to each class of
shares based on the relative net assets of each class to the total net assets
of the Fund. Net investment income, other than class specific expenses, is
allocated daily to each class of shares based upon the ratio of the value of
each class' paid shares to the total value of all paid shares. Each class of
shares differs in its distribution plan and certain other class specific
expenses. The Fund currently invests all of its investable assets in
interests in two Portfolios, Strategic Income Portfolio and High Income
Portfolio (the Portfolios), New York trusts which have investment objectives
consistent with that of the Fund. The value of the Fund's investment in the
Portfolios reflects the Fund's proportionate interest in the net assets of
the Strategic Income Portfolio and the High Income Portfolio (99.99% and 4.0%
at April 30, 2000, respectively). The performance of the Fund is directly
affected by the performance of the Portfolios. The financial statements of
the Strategic Income Portfolio, including the portfolio of investments, are
included elsewhere in this report and should be read in conjunction with the
Fund's financial statements. See Note 8 for further information on the
results of operations of High Income Portfolio. A copy of the financial
statements of High Income Portfolio is available upon request from Eaton
Vance Distributors.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A Investment Valuation -- Valuation of securities by the Strategic Income
Portfolio is discussed in Note 1A of the Portfolio's Notes to Financial
Statements, which are included elsewhere in this report. High Income
Portfolio's valuation policies are as follows: Investments listed on
securities exchanges or in the NASDAQ National Market are valued at closing
sale prices. Listed or unlisted investments for which closing sale prices are
not available are valued at the mean between the latest bid and asked prices.
Fixed income investments (other than short-term obligations), including
listed investments and investments for which price quotations are available,
will normally be valued on the basis of market valuations furnished by a
pricing service. Financial futures contracts listed on commodity exchanges
are valued at closing settlement prices. Short-term obligations, maturing in
sixty days or less, are valued at amortized cost, which approximates value.
Investments for which there are no quotations or valuations are valued at
fair value using methods determined in good faith by or at the direction of
the Trustees.
B Income -- The Fund's net investment income consists of the Fund's pro rata
share of the net investment income of the Portfolios, less all actual and
accrued expenses of the Fund determined in accordance with generally accepted
accounting principles.
C Federal Taxes -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments. Accordingly, no provision for Federal
income or excise tax is necessary. At October 31, 1999, the Fund, for Federal
income tax purposes, had a capital loss carryover of $19,005,452, which will
reduce the Fund's taxable income arising from future net realized gains on
investments, if any, to the extent permitted by the Internal Revenue Code,
and thus will reduce the amount of the distributions to shareholders which
would otherwise be necessary to relieve the Fund of any liability for federal
income or excise tax. Such capital loss carryovers will expire on
October 31, 2002 ($4,214,275), October 31, 2003 ($4,613,119), October 31,
2006 ($2,245,050) and October 31, 2007 ($7,933,008).
D Use of Estimates -- The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could
differ from those estimates.
E Interim Financial Statements -- The interim financial statements relating to
April 30, 2000 and for the six months then ended have not been audited by
independent certified public accountants, but in the
8
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
opinion of the Fund's management reflect all adjustments, consisting only of
normal recurring adjustments, necessary for the fair presentation of the
financial statements.
2 Distributions to Shareholders
-------------------------------------------
The net income of the Fund is determined daily and substantially all of the
net income so determined is declared as a dividend to shareholders of record
at the time of declaration. Distributions are paid monthly. Distributions of
allocated realized capital gains, if any, are made at least annually.
Shareholders may reinvest income and capital gain distributions in additional
shares of the Fund at the net asset value as of the ex-dividend date.
Distributions are paid in the form of additional shares or, at the election
of the shareholder, in cash. The Fund distinguishes between distributions on
a tax basis and a financial reporting basis. Generally accepted accounting
principles require that only distributions in excess of tax basis earnings
and profits be reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in
over-distributions for financial statement purposes only are classified as
distributions in excess of net investment income or accumulated net realized
gains. Permanent differences between book and tax accounting relating to
distributions are reclassified to paid-in capital.
3 Shares of Beneficial Interest
-------------------------------------------
The Fund's Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest (without par
value). Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 YEAR ENDED
CLASS A (UNAUDITED) OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------
Sales 308,888 479,935
Issued to shareholders electing to
receive payments of distributions in
Fund shares 21,939 25,638
Redemptions (86,671) (58,971)
----------------------------------------------------------------------------
NET INCREASE 244,156 446,602
----------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 YEAR ENDED
CLASS B (UNAUDITED) OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------
Sales 2,069,813 4,608,260
Issued to shareholders electing to
receive payments of distributions in
Fund shares 252,055 557,297
Redemptions (1,845,615) (2,965,773)
----------------------------------------------------------------------------
NET INCREASE 476,253 2,199,784
----------------------------------------------------------------------------
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 YEAR ENDED
CLASS C (UNAUDITED) OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------
Sales 863,856 1,420,517
Issued to shareholders electing to
receive payments of distributions in
Fund shares 60,628 102,858
Redemptions (426,558) (455,954)
----------------------------------------------------------------------------
NET INCREASE 497,926 1,067,421
----------------------------------------------------------------------------
</TABLE>
4 Investment Adviser Fee and Other Transactions with Affiliates
-------------------------------------------
Eaton Vance Management (EVM) serves as the administrator of the Fund, but
receives no compensation. The Portfolios have engaged Boston Management and
Research (BMR), a subsidiary of EVM, to render investment advisory services.
See Note 2 of each of the Portfolio's Notes to financial statements. Except
as to Trustees of the Fund and the Portfolios who are not members of EVM's
organization, officers and Trustees receive remuneration for their services
to the Fund out of such investment adviser fee. Certain officers and Trustees
of the Fund and of the Portfolios are officers of the above organizations
(see Note 5). The Fund was informed that Eaton Vance Distributors, Inc.
(EVD), a subsidiary of EVM and the Fund's principal underwriter, received
$2,439 as its portion of the sales charge on sales of Class A shares for the
six months ended April 30, 2000.
5 Distribution and Service Plans
-------------------------------------------
The Fund has in effect distribution plans for Class B shares (Class B Plan)
and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the Investment
Company Act of 1940 and a service plan for Class A shares (Class A Plan)
(collectively, the Plans). The Class B and Class C Plans require the Fund to
pay EVD, amounts equal to 1/365 of 0.75% of the Fund's average daily net
assets attributable to Class B and Class C shares, for providing ongoing
9
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
distribution services and facilities to the Fund. The Fund will automatically
discontinue payments to EVD during any period in which there are no
outstanding Uncovered Distribution Charges, which are equivalent to the sum
of (i) 5% and 6.25% of the aggregate amount received by the Fund for Class B
and Class C shares sold, respectively, plus (ii) interest calculated by
applying the rate of 1% over the prevailing prime rate to the outstanding
balance of Uncovered Distribution Charges due EVD, of each respective class
reduced by the aggregate amount of contingent deferred sales charges (see
Note 6) and daily amounts theretofore paid to EVD by each respective class.
The amount payable to EVD with respect to each day is accrued on such day as
a liability of the Fund and, accordingly, reduces the Fund's net assets. For
the six months ended April 30, 2000, the Fund paid or accrued $589,861 and
$120,477, respectively, to or payable to EVD representing 0.75% of average
daily net assets of Class B and Class C shares, respectively. At April 30,
2000, the amount of Uncovered Distribution Charges of EVD calculated under
the Plans was approximately $25,074,000 and $3,112,000 for Class B and
Class C shares, respectively.
The Plans authorize the Fund to make payments of service fees to EVD,
investment dealers and other persons in amounts not exceeding 0.25% of the
Fund's average daily net assets attributable to Class A, Class B, and
Class C shares for each fiscal year. The Trustees initially implemented the
Plans by authorizing the Fund to make quarterly payments of service fees to
EVD and investment dealers equal to 0.25% per annum of the Fund's average
daily net assets attributable to Class A and Class B shares based on the
value of Fund shares sold by such persons and remaining outstanding for at
least one year. On October 4, 1999, the Trustees approved service fee
payments equal to 0.25% per annum of the Fund's average daily net assets
attributable to Class A and Class B shares for any fiscal year on shares of
the Fund sold on or after October 12, 1999. The Class C Plan permits the Fund
to make monthly payments of service fees in amounts not expected to exceed
0.25% of the Fund's average daily net assets attributable to Class C shares
for any fiscal year. Service fee payments will be made for personal services
and/or the maintenance of shareholder accounts. Service fees are separate and
distinct from the sales and commissions and distribution fees payable by the
Fund to EVD, and, as such are not subject to automatic discontinuance when
there are no outstanding Uncovered Distribution Charges of EVD. Service fee
payments for the six months ended April 30, 2000 amounted to $5,184,
$178,597, and $40,159 for Class A, Class B, and Class C shares, respectively.
6 Contingent Deferred Sales Charge
-------------------------------------------
A contingent deferred sales charge (CDSC) generally is imposed on redemptions
of Class B shares made within six years of purchase and on redemptions of
Class C shares made within one year of purchase. Generally, the CDSC is based
on the lower of the net asset value at the date of redemption or date of
purchase. No charge is levied on shares acquired by reinvestment of dividends
or capital gains distributions. The Class B CDSC is imposed at declining
rates that begin at 5% in the case of redemptions in the first and second
years of redemption after purchase, declining one percentage point each
subsequent year. Class C shares will be subject to a 1% CDSC if redeemed
within one year of purchase. No CDSC is levied on shares which have been sold
to EVM or its affiliates or to their respective employees or clients and may
be waived under certain other limited conditions. CDSC charges are paid to
EVD to reduce the amount of Uncovered Distribution Charges calculated under
the Fund's Distribution Plans. CDSC charges received when no Uncovered
Distribution Charges exist will be credited to the Fund. The Fund has been
informed that EVD received approximately $10,176,000 and $13,000 of CDSC paid
by shareholders of Class B and Class C shares, respectively, during the six
months ended April 30, 2000.
7 Investment Transactions
-------------------------------------------
Increases and decreases in the Fund's investment in the Strategic Income
Portfolio for the six months ended April 30, 2000, aggregated $29,545,557 and
$23,680,035, respectively. Decreases in the Fund's investment in the High
Income Portfolio aggregated $4,000,000.
10
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D
8 Investment in Portfolios
-------------------------------------------
For the six months ended April 30, 2000, the Fund was allocated net
investment income and realized and unrealized gain (loss) from the Portfolios
as follows:
<TABLE>
<CAPTION>
STRATEGIC HIGH
INCOME INCOME
PORTFOLIO PORTFOLIO TOTAL
<S> <C> <C> <C>
------------------------------------------------------------------------------
Dividend income $ 73,606 $ 234,845 $ 308,451
Interest income 6,719,236 2,457,912 9,177,148
Expenses (661,560) (150,668) (812,228)
------------------------------------------------------------------------------
NET INVESTMENT INCOME $ 6,131,282 $2,542,089 $ 8,673,371
------------------------------------------------------------------------------
Net realized gain (loss) --
Investments (identified cost basis) $ 1,470,874 $ 489,573 $ 1,960,447
Financial futures contracts (360,143) -- (360,143)
Foreign currency transactions 722,176 -- 722,176
------------------------------------------------------------------------------
NET REALIZED GAIN ON INVESTMENTS $ 1,832,907 $ 489,573 $ 2,322,480
------------------------------------------------------------------------------
Change in unrealized
appreciation (depreciation)
Investment transactions $(4,650,122) $ (719,910) $(5,370,032)
Financial futures contracts 50,692 -- 50,692
Foreign currency, and forward foreign
currency exchange contracts 783,444 -- 783,444
------------------------------------------------------------------------------
NET CHANGE IN UNREALIZED
APPRECIATION (DEPRECIATION) $(3,815,986) $ (719,910) $(4,535,896)
------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
PORTFOLIO OF INVESTMENTS
BONDS & NOTES -- 93.5%
<TABLE>
<CAPTION>
SECURITY PRINCIPAL U.S. $ VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
Argentina -- 1.2%
-----------------------------------------------------------------------------
Cablevision SA, 13.75%, 4/30/07(1) $ 2,000,000 $ 1,940,000
-----------------------------------------------------------------------------
Total Argentina (identified cost $1,977,506) $ 1,940,000
-----------------------------------------------------------------------------
Brazil -- 4.4%
-----------------------------------------------------------------------------
Brazil Discount Bond (Brady),
7.375%, 4/15/24(2) $ 9,000,000 $ 6,969,420
-----------------------------------------------------------------------------
Total Brazil (identified cost $7,058,959) $ 6,969,420
-----------------------------------------------------------------------------
Bulgaria -- 1.4%
-----------------------------------------------------------------------------
Bulgaria Discount Bond (Brady),
Series A, 7.063%, 7/28/24(2) $ 3,000,000 $ 2,302,500
-----------------------------------------------------------------------------
Total Bulgaria (identified cost $1,805,069) $ 2,302,500
-----------------------------------------------------------------------------
Greece -- 1.8%
-----------------------------------------------------------------------------
Hellenic Republic, 9.20%, 3/21/02 GRD 1,000,000,000 $ 2,855,018
-----------------------------------------------------------------------------
Total Greece (identified cost $3,762,330) $ 2,855,018
-----------------------------------------------------------------------------
Indonesia -- 3.7%
-----------------------------------------------------------------------------
APP Finance VI, 0.00%, 11/18/12 $ 4,000,000 $ 720,000
APP Finance VII, 3.50%, 4/30/03(3) 1,000,000 790,000
APP Global Finance V, 2.00%, 7/25/00(3) 2,000,000 2,360,000
DGS International Finance,
10.00%, 6/1/07 2,000,000 660,000
Indah Kiat Finance Mauritius, Sr. Unsec.
Notes, 10.00%, 7/1/07 1,000,000 652,500
Indah Kiat International Finance,
12.50%, 6/15/06 1,000,000 760,000
-----------------------------------------------------------------------------
Total Indonesia (identified cost $6,455,131) $ 5,942,500
-----------------------------------------------------------------------------
Mexico -- 1.8%
-----------------------------------------------------------------------------
Alestra SA, Sr. Notes, 12.125%, 5/15/06 $ 3,000,000 $ 2,910,000
-----------------------------------------------------------------------------
Total Mexico (identified cost $3,000,000) $ 2,910,000
-----------------------------------------------------------------------------
Morocco -- 0.4%
-----------------------------------------------------------------------------
Snap Ltd., 11.50%, 1/29/09 DEM 1,612,500 $ 679,579
-----------------------------------------------------------------------------
Total Morocco (identified cost $791,573) $ 679,579
-----------------------------------------------------------------------------
Peru -- 4.4%
-----------------------------------------------------------------------------
Peru FLIRB (Brady), 3.75%, 3/7/17(2) $ 7,000,000 $ 4,291,875
Peru PDI (Brady), 4.50%, 3/7/17(2) 4,000,000 2,691,520
-----------------------------------------------------------------------------
Total Peru (identified cost $6,249,254) $ 6,983,395
-----------------------------------------------------------------------------
<CAPTION>
SECURITY PRINCIPAL U.S. $ VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
Philippines -- 1.5%
-----------------------------------------------------------------------------
Bayan Telecommunications,
13.50%, 7/15/06(1) $ 2,000,000 $ 1,450,000
Republic of Philippines,
10.625%, 3/16/25 1,000,000 927,500
-----------------------------------------------------------------------------
Total Philippines (identified cost $2,875,092) $ 2,377,500
-----------------------------------------------------------------------------
Poland -- 3.2%
-----------------------------------------------------------------------------
Poland Government Bond, 8.50%, 2/12/05 PLN 28,000,000 $ 5,125,000
-----------------------------------------------------------------------------
Total Poland (identified cost $5,754,134) $ 5,125,000
-----------------------------------------------------------------------------
Republic of Korea -- 0.9%
-----------------------------------------------------------------------------
Cho Hung Bank, Sub. Notes,
11.50%, 4/1/10(1) $ 1,500,000 $ 1,477,500
-----------------------------------------------------------------------------
Total Republic of Korea (identified cost $1,500,000)
$ 1,477,500
-----------------------------------------------------------------------------
Taiwan -- 4.6%
-----------------------------------------------------------------------------
Acer, Inc., 0.00%, 2/1/05(1)(3) $ 2,000,000 $ 1,990,000
Macronix International Co.,
1.00%, 2/1/05(1)(3) 1,500,000 1,942,500
Mosel Vitelic, Inc.,
1.00%, 2/2/05(1)(3) 3,000,000 3,435,000
-----------------------------------------------------------------------------
Total Taiwan (identified cost $6,977,501) $ 7,367,500
-----------------------------------------------------------------------------
Thailand -- 1.1%
-----------------------------------------------------------------------------
Bangkok Bank, 8.75%, 3/15/07(1) $ 2,000,000 $ 1,720,000
-----------------------------------------------------------------------------
Total Thailand (identified cost $1,689,847) $ 1,720,000
-----------------------------------------------------------------------------
Turkey -- 2.7%
-----------------------------------------------------------------------------
Republic of Turkey, 11.875%, 1/15/30 $ 3,000,000 $ 3,243,750
Republic of Turkey, 12.375%, 6/15/09 1,000,000 1,090,000
-----------------------------------------------------------------------------
Total Turkey (identified cost $4,115,930) $ 4,333,750
-----------------------------------------------------------------------------
United Kingdom -- 0.5%
-----------------------------------------------------------------------------
Esprit Telecom Group PLC,
11.00%, 6/15/08 DEM 2,000,000 $ 870,830
-----------------------------------------------------------------------------
Total United Kingdom (identified cost $1,117,631)
$ 870,830
-----------------------------------------------------------------------------
United States -- 59.9%
-----------------------------------------------------------------------------
CORPORATE BONDS & NOTES -- 15.4%
American Greetings, 6.10%, 8/1/28 $ 1,000,000 $ 863,320
AT & T Corp., 6.50%, 3/15/29 4,000,000 3,384,360
Baltimore Natural Gas and Electric,
6.73%, 6/12/12 400,000 388,540
Bellsouth Capital Fund, 6.04%, 11/15/26 300,000 294,294
Beneficial Corp., 8.40%, 5/15/08 330,000 336,115
Commercial Credit Corp., 7.875%, 2/1/25 2,000,000 2,026,740
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
PORTFOLIO OF INVESTMENTS CONT'D
<TABLE>
<CAPTION>
SECURITY PRINCIPAL U.S. $ VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
United States (continued)
-----------------------------------------------------------------------------
Dayton Hudson, Medium Term Notes,
5.865%, 8/15/27 $ 1,000,000 $ 996,860
Dayton Hudson, Medium Term Notes,
9.52%, 6/10/15 350,000 407,652
Eaton Corp., 8.875%, 6/15/19 500,000 564,915
Ford Holdings, 9.30%, 3/1/30 1,000,000 1,123,810
Ford Motor Co., 7.45%, 7/16/31 2,000,000 1,899,320
General Motors Acceptance Corp.,
8.875%, 6/1/10 1,000,000 1,053,920
Grand Metropolitan Investments Corp.,
7.45%, 4/15/35 300,000 297,486
Ingersoll-Rand, 6.48%, 6/1/25 1,000,000 931,160
Johnson Controls, 7.70%, 3/1/15 1,500,000 1,554,810
Level 3 Communications, Inc., Sr. Notes,
11.25%, 3/15/10(1) EUR 1,000,000 880,154
Motorola, Inc., 6.50%, 9/1/25 300,000 288,081
Motorola, Inc., 8.40%, 8/15/31 1,500,000 1,621,350
NBD Bank N.A., 8.25%, 11/1/24 610,000 632,296
Northwest National Gas, 6.80%, 5/21/07 250,000 249,045
Penney (JC) Co., Inc., 7.40%, 4/1/37 300,000 253,896
Procter and Gamble Co., 8.00%, 9/1/24 1,500,000 1,555,635
TRW, Inc., Medium Term Notes,
9.35%, 6/4/20 1,900,000 2,177,210
Worldcom, Inc., 7.75%, 4/1/27 1,000,000 967,520
-----------------------------------------------------------------------------
Total Corporate Bonds & Notes (identified cost, $25,690,572)
$ 24,748,489
-----------------------------------------------------------------------------
MORTGAGE PASS-THROUGHS -- 31.9%
Federal Home Loan Mortgage Corp.:
4.75% with maturity at 2001 $ 1,084 $ 1,063
8.00% with various maturities to 2021 5,931,915 5,957,356
8.50% with various maturities to 2019 1,185,102 1,212,224
9.00% with maturity at 2019 346,969 359,517
9.25% with various maturities to 2016 3,850,105 3,963,716
9.50% with maturity at 2015 1,319,497 1,359,318
9.75% with various maturities to 2020 915,317 956,140
10.50% with maturity at 2020 638,886 682,630
11.00% with maturity at 2019 1,474,722 1,577,350
11.25% with maturity at 2010 216,040 230,711
12.50% with various maturities to
2019 1,604,539 1,797,258
12.75% with maturity at 2013 95,523 105,809
13.25% with maturity at 2013 70,000 78,586
13.50% with maturity at 2019 197,153 222,985
-----------------------------------------------------------------------------
$ 18,504,663
-----------------------------------------------------------------------------
Federal National Mortgage Association:
5.00% with maturity at 2003 $ 34,584 $ 33,665
5.50% with maturity at 2012 3,263 3,133
7.00% with maturity at 2014 3,327,683 3,285,229
7.50% with various maturities to 2018 1,949,075 1,947,248
<CAPTION>
SECURITY PRINCIPAL U.S. $ VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
United States (continued)
-----------------------------------------------------------------------------
8.00% with various maturities to 2019 $ 1,616,858 $ 1,629,547
8.50% with various maturities to 2026 4,548,076 4,643,618
9.00% with various maturities to 2021 3,224,683 3,321,458
9.50% with maturity at 2013 1,492,734 1,559,590
11.00% with maturity at 2025 692,433 751,653
11.50% with maturity at 2019 1,425,210 1,576,038
12.00% with maturity at 2015 532,415 588,722
12.50% with maturity at 2015 3,170,200 3,543,827
12.75% with maturity at 2014 76,145 85,997
13.00% with various maturities to
2027 1,669,538 1,885,757
13.25% with maturity at 2014 148,872 171,000
13.50% with various maturities to
2015 830,152 935,727
14.75% with maturity at 2012 1,484,174 1,729,615
-----------------------------------------------------------------------------
$ 27,691,824
-----------------------------------------------------------------------------
Government National Mortgage Association:
6.50% with maturity at 2002 $ 342,604 $ 338,504
7.50% with maturity at 2017 514,567 519,467
8.30% with maturity at 2020 774,195 792,002
8.50% with maturity at 2009 615,535 625,112
9.00% with maturity at 2016 449,928 465,783
12.50% with maturity at 2019 1,790,600 2,008,561
13.50% with maturity at 2014 161,486 185,638
-----------------------------------------------------------------------------
$ 4,935,067
-----------------------------------------------------------------------------
Total Mortgage Pass-Throughs (identified cost, $52,958,521)
$ 51,131,554
-----------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY DEBENTURES -- 11.3%
Federal Home Loan Mortgage Corp.,
6.45%, 4/29/09 $ 6,000,000 $ 5,536,380
Federal Home Loan Mortgage Corp.,
6.625%, 9/15/09 3,000,000 2,859,840
Federal National Mortgage Association,
6.25%, 5/15/29 11,000,000 9,740,170
-----------------------------------------------------------------------------
Total U.S. Government Agency Debentures
(identified cost, $18,694,568) $ 18,136,390
-----------------------------------------------------------------------------
U.S. TREASURY OBLIGATIONS -- 1.3%
United States Treasury Bond,
11.75%, 2/15/01(4)
-(identified cost, $2,603,437) $ 2,000,000 $ 2,083,740
-----------------------------------------------------------------------------
Total United States (identified cost $99,947,098)
$ 96,100,173
-----------------------------------------------------------------------------
Total Bonds & Notes (identified cost, $155,077,055)
$149,954,665
-----------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
PORTFOLIO OF INVESTMENTS CONT'D
U.S. COMMON STOCKS -- 1.0%
<TABLE>
<CAPTION>
SECURITY SHARES VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
REITS -- 1.0%
-----------------------------------------------------------------------------
Archstone Communities Trust 19,500 $ 421,687
Duke-Weeks Realty Corp. 20,500 444,594
Public Storage, Inc. 33,000 738,375
-----------------------------------------------------------------------------
Total U.S. Common Stocks (identified cost $1,579,315)
$ 1,604,656
-----------------------------------------------------------------------------
</TABLE>
SHORT-TERM INVESTMENTS -- 3.4%
<TABLE>
<CAPTION>
SECURITY PRINCIPAL VALUE
<S> <C> <C> <C>
-----------------------------------------------------------------------------
Banque National De Paris Euro
Time-deposit Cayman Islands,
5.938%, 5/1/00 $ 5,400,000 $ 5,400,000
-----------------------------------------------------------------------------
Total Short-Term Investments (at amortized cost, $5,400,000)
$ 5,400,000
-----------------------------------------------------------------------------
Total Investments -- 97.9%
(identified cost $162,056,370) $156,959,321
-----------------------------------------------------------------------------
Other Assets, Less Liabilities -- 2.1% $ 3,336,480
-----------------------------------------------------------------------------
Net Assets -- 100.0% $160,295,801
-----------------------------------------------------------------------------
</TABLE>
DEM - Deutsche Mark
EUR - Euro
GRD - Greek Drachma
PLN - Polish Zloty
REIT - Real Estate Investment Trust
(1) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(2) Variable rate security.
(3) Convertible Bond
(4) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AS OF APRIL 30, 2000
<S> <C>
Assets
------------------------------------------------------
Investments, at value
(identified cost, $162,056,370) $156,959,321
Cash 31,938
Receivable for investments sold 169,048
Interest receivable 2,521,336
Receivable for daily variation margin on
open financial futures
contracts, net 54,751
Receivable for open forward foreign
currency contracts, net 730,953
------------------------------------------------------
TOTAL ASSETS $160,467,347
------------------------------------------------------
Liabilities
------------------------------------------------------
Payable to affiliate for Trustees' fees $ 3,890
Accrued expenses 167,656
------------------------------------------------------
TOTAL LIABILITIES $ 171,546
------------------------------------------------------
NET ASSETS APPLICABLE TO INVESTORS'
INTEREST IN PORTFOLIO $160,295,801
------------------------------------------------------
Sources of Net Assets
------------------------------------------------------
Net proceeds from capital contributions
and withdrawals $164,555,708
Net unrealized depreciation (computed on
the basis of identified cost) (4,259,907)
------------------------------------------------------
TOTAL $160,295,801
------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
APRIL 30, 2000
<S> <C>
Investment Income
-----------------------------------------------------
Interest $ 6,719,237
Dividends 73,606
-----------------------------------------------------
TOTAL INVESTMENT INCOME $ 6,792,843
-----------------------------------------------------
Expenses
-----------------------------------------------------
Investment adviser fee $ 393,606
Administration fee 112,881
Trustees fees and expenses 10,838
Legal and accounting services 100,390
Custodian fee 43,274
Miscellaneous 571
-----------------------------------------------------
TOTAL EXPENSES $ 661,560
-----------------------------------------------------
NET INVESTMENT INCOME $ 6,131,283
-----------------------------------------------------
Realized and Unrealized Gain (Loss)
-----------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 1,470,874
Financial futures contracts (360,143)
Foreign currency and forward foreign
currency exchange
contract transactions 722,176
-----------------------------------------------------
NET REALIZED GAIN $ 1,832,907
-----------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $(4,650,122)
Financial futures contracts 50,692
Foreign currency and forward foreign
currency exchange contracts 783,444
-----------------------------------------------------
NET CHANGE IN UNREALIZED
APPRECIATION (DEPRECIATION) $(3,815,986)
-----------------------------------------------------
NET REALIZED AND UNREALIZED LOSS $(1,983,079)
-----------------------------------------------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 4,148,204
-----------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
FINANCIAL STATEMENTS CONT'D
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
INCREASE (DECREASE) SIX MONTHS ENDED YEAR ENDED
IN NET ASSETS APRIL 30, 2000 OCTOBER 31, 1999
<S> <C> <C>
----------------------------------------------------------------------------
From operations --
Net investment income $ 6,131,283 $ 12,637,218
Net realized gain (loss) 1,832,907 (8,710,614)
Net change in unrealized
appreciation (depreciation) (3,815,986) 5,196,296
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS $ 4,148,204 $ 9,122,900
----------------------------------------------------------------------------
Capital transactions --
Contributions $ 29,545,557 $ 63,662,682
Withdrawals (23,680,035) (60,949,450)
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS FROM
CAPITAL TRANSACTIONS $ 5,865,522 $ 2,713,232
----------------------------------------------------------------------------
NET INCREASE IN NET ASSETS $ 10,013,726 $ 11,836,132
----------------------------------------------------------------------------
Net Assets
----------------------------------------------------------------------------
At beginning of period $ 150,282,075 $ 138,445,943
----------------------------------------------------------------------------
AT END OF PERIOD $ 160,295,801 $ 150,282,075
----------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
16
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
FINANCIAL STATEMENTS CONT'D
SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
SIX MONTHS ENDED --------------------------------------------------------------
APRIL 30, 2000 1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
------------------------------------------------------------------------------------------------------------------
Ratios (As a percentage of
average daily net assets):
Expenses 0.88%(1) 0.86% 0.83% 0.86% 0.86% 0.84%
Net investment income 8.14%(1) 9.14% 8.31% 8.06% 8.62% 9.08%
Portfolio Turnover 27% 47% 71% 77% 71% 78%
------------------------------------------------------------------------------------------------------------------
NET ASSETS, END OF PERIOD
(000'S OMITTED) $160,296 $150,282 $138,446 $121,256 $132,407 $152,583
------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
17
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS
1 Significant Accounting Policies
-------------------------------------------
Strategic Income Portfolio (the Portfolio) is registered under the Investment
Company Act of 1940 as a non-diversified open-end investment company. The
Portfolio, which was organized as a trust under the laws of the State of New
York in 1992, seeks to provide a high level of income by investing in a
global portfolio consisting primarily of high grade debt securities. The
Declaration of Trust permits the Trustees to issue beneficial interests in
the Portfolio. The following is a summary of significant accounting policies
of the Portfolio. The policies are in conformity with generally accepted
accounting principles.
A Investment Valuation -- Debt securities (other than mortgage-backed,
pass-through securities and short-term obligations maturing in sixty days or
less), including listed securities and securities for which price quotations
are available and forward contracts, will normally be valued on the basis of
market valuations furnished by pricing services. Mortgage backed,
pass-through securities are valued using an independent matrix pricing system
applied by the advisor which takes into account closing bond valuations,
yield differentials, anticipated prepayments and interest rates provided by
dealers. Equity securities listed on securities exchanges or in the NASDAQ
National Market are valued at closing sales prices or, if there has been no
sale, at the mean between the closing bid and asked prices. Unlisted
securities are valued at the mean between the latest available bid and asked
prices. Financial futures contracts listed on commodity exchanges and
exchange-traded options are valued at closing settlement prices. Short-term
obligations and money-market securities maturing in sixty days or less are
valued at amortized cost which approximates value. Non-U.S. dollar
denominated short-term obligations are valued at amortized cost as calculated
in the base currency and translated to U.S. dollars at the current exchange
rate. Investments for which market quotations are unavailable are valued at
fair value using methods determined in good faith by or at the direction of
the Trustees.
B Income -- Interest income is determined on the basis of interest accrued and
discount earned, adjusted for amortization of premium or accretion of
discount when required for federal income tax purposes. Dividend income is
recorded on the ex-dividend date for dividends received in cash and/or
securities. However, if the ex-dividend date has passed, certain dividends
from foreign securities are recorded as the Portfolio is informed of the
ex-dividend date. Dividend income may include dividends that represent
returns of capital for federal income tax purposes.
C Gains and Losses From Investment Transactions -- Realized gains and losses
from investment transactions are recorded on the basis of identified cost. For
book purposes, gains and losses are not recognized until disposition. For
federal tax purposes, the Portfolio is subject to special tax rules that may
affect the amount, timing and character of gains recognized on certain of the
Portfolio's investments.
D Income Taxes -- The Portfolio is treated as a partnership for federal tax
purposes. No provision is made by the Portfolio for federal or state taxes on
any taxable income of the Portfolio because each investor in the Portfolio is
ultimately responsible for the payment of any taxes. Since one of the
Portfolio's investors is a regulated investment company that invests all or
substantially all of its assets in the Portfolio, the Portfolio normally must
satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for its investors to satisfy them.
The Portfolio will allocate at least annually among its investors each
investor's distributive share of the Portfolio's net investment income, net
realized capital gains, and any other items of income, gain, loss, deduction
or credit. Withholding taxes on foreign dividends and capital gains have been
provided for in accordance with the Portfolio's understanding of the
applicable countries' tax rules and rates.
E Financial Futures Contracts -- Upon entering into a financial futures
contract, the Portfolio is required to deposit an amount (initial margin),
either in cash or securities, equal to a certain percentage of the purchase
price indicated in the financial futures contract. Subsequent payments are
made or received by the Portfolio (variation margin) each day, dependent on
the daily fluctuations in the value of the underlying security, and are
recorded for book purposes as unrealized gains or losses by the Portfolio.
The Portfolio's investment in financial futures contracts is designed for
both hedging against anticipated future changes in interest or currency
exchange rates and investment purposes. Should interest or currency exchange
rates move unexpectedly, the Portfolio may not achieve the anticipated
benefits of the financial futures contracts and may realize a loss. If the
Portfolio enters into a closing transaction, the Portfolio will realize, for
book purposes, a gain or loss equal to the difference between the value of
the financial futures contract to sell and financial futures contract to buy.
F 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
18
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS CONT'D
and sales of foreign investment securities and income and expenses are
converted into U.S. dollars based upon currency exchange rates prevailing on
the respective dates of such transactions. Recognized gains or losses on
investment transactions attributable to changes in foreign currency exchange
rates are recorded for financial statement purposes as net realized gains and
losses on investments. That portion of unrealized gains and losses on
investments that results from fluctuations in foreign currency exchange rates
is not separately disclosed.
G Written Options -- The Portfolio may write call or put options for which
premiums are received and are recorded as liabilities, and are subsequently
adjusted to the current value of the options written. Premiums received from
writing options which expire are treated as realized gains. Premiums received
from writing options which are exercised or are closed are offset against the
proceeds or amount paid on the transaction to determine the realized gain or
loss. If a put option is exercised, the premium reduces the cost basis of the
securities purchased by the Portfolio. The Portfolio as writer of an option
may have no control over whether the underlying securities may be sold (call)
or purchased (put) and as a result bears the market risk of an unfavorable
change in the price of the securities underlying the written option.
H Forward Foreign Currency Exchange Contracts -- The Portfolio 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 these contracts from the potential inability of counterparties
to meet the terms of their contracts and from movements in the value of a
foreign currency relative to the U.S. dollar. The Portfolio will enter into
forward contracts for hedging purposes as well as non-hedging purposes. The
forward foreign currency exchange contracts are adjusted by the daily
exchange rate of the underlying currency and any gains or losses are recorded
for financial statement purposes as unrealized until such time as the
contracts have been closed.
I Reverse Repurchase Agreements -- The Portfolio may enter into reverse
repurchase agreements. Under such an agreement, the Portfolio temporarily
transfers possession, but not ownership, of a security to a counterparty, in
return for cash. At the same time, the Portfolio agrees to repurchase the
security at an agreed-upon price and time in the future. The Portfolio may
enter into reverse repurchase agreements for temporary purposes, such as to
fund withdrawals, or for use as hedging instruments where the underlying
security is denominated in a foreign currency. As a form of leverage, reverse
repurchase agreements may increase the risk of fluctuation in the market
value of the Portfolio's assets or in its yield. Liabilities to
counterparties under reverse repurchase agreements are recognized in the
Statement of Assets and Liabilities at the same time at which cash is
received by the Portfolio. The securities underlying such agreements continue
to be treated as owned by the Portfolio and remain in the Portfolio of
Investments. Interest charged on amounts borrowed by the Portfolio under
reverse repurchase agreements is accrued daily and offset against interest
income for financial statement purposes.
J Expense Reduction -- Investors Bank & Trust Company (IBT) serves as custodian
of the Portfolio. Pursuant to the custodian agreement, IBT receives a fee
reduced by credits which are determined based on the average daily cash
balance the Portfolio maintains with IBT. All significant credits used to
reduce the Portfolio's custodian fees are reported separately as a reduction
of total expenses in the Statement of Operations. For the six months ended
April 30, 2000, $817 in credits were used to reduce the Portfolio's custodian
fee.
K Use of Estimates -- The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. Actual results could
differ from those estimates.
L Other -- Investment transactions are accounted for on a trade date basis.
2 Investment Adviser Fee and Other Transactions with Affiliates
-------------------------------------------
The investment adviser fee is earned by Boston Management and Research (BMR),
a wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation
for management and investment advisory services rendered to the Portfolio.
The fee is based upon a percentage of average daily net assets plus a
percentage of gross income (i.e., income other than gains from the sale of
investments). Such percentages are reduced as average daily net assets exceed
certain levels. For the six months ended April 30, 2000, the fee was
equivalent to 0.52% of the Portfolio's average net assets for such period and
amounted to $393,606. An administration fee, computed at an effective annual
rate of 0.15% of average daily net
19
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS CONT'D
assets was also paid to BMR for administrative services and office
facilities. Such fee amounted to $112,881 for the six months ended April 30,
2000.
Except as to Trustees of the Portfolio who are not members of EVM's or BMR's
organization, officers and Trustees receive remuneration for their services
to the Portfolio out of such investment adviser fee. Trustees of the
Portfolio that are not affiliated with the Investment Adviser may elect to
defer receipt of all or a portion of their annual fees in accordance with the
terms of the Trustees Deferred Compensation Plan. For the six months ended
April 30, 2000, no significant amounts have been deferred. Certain officers
and Trustees of the Portfolio are officers of the above organizations.
3 Line of Credit
-------------------------------------------
The Portfolio participates with other portfolios and funds managed by BMR or
EVM and its affiliates in a $150 million unsecured line of credit agreement
with a group of banks. Borrowings will be made by the Portfolio solely to
facilitate the handling of unusual and/or unanticipated short-term cash
requirements. Interest is charged to each portfolio or fund based on its
borrowings at an amount above the Eurodollar rate or federal funds rate. In
addition, a fee computed at an annual rate of 0.10% on the daily unused
portion of the line of credit is allocated among the participating portfolios
and funds at the end of each quarter. The Portfolio did not have any
significant borrowings or allocated fees during the six months
ended April 30, 2000.
4 Investment Transactions
-------------------------------------------
The Portfolio invests primarily in foreign government and U.S. Government
debt securities. The ability of the issuers of the debt securities to meet
their obligations may be affected by economic developments in a specific
industry or country. The Portfolio regularly invests in lower rated and
comparable quality unrated high yield securities. These investments have
different risks than investments in debt securities rated investment grade
and held by the Portfolio. Risk of loss upon default by the borrower is
significantly greater with respect to such debt securities than with other
debt securities because these securities are generally unsecured and are more
sensitive to adverse economic conditions, such as recession or increasing
interest rates, than are investment grade issuers. At April 30, 2000, the
Portfolio had invested approximately 29.2% of its net assets or approximately
$46,755,000 in high yield securities. Purchases and sales of investments,
other than short-term obligations, for the six months ended April 30, 2000
were as follows:
<TABLE>
<CAPTION>
PURCHASES
<S> <C>
-----------------------------------------------------
Investments (non-U.S. Government) $45,170,538
U.S. Government Securities 4,583,227
-----------------------------------------------------
$49,753,765
-----------------------------------------------------
<CAPTION>
SALES
<S> <C>
-----------------------------------------------------
Investments (non-U.S. Government) $28,086,736
U.S. Government Securities 10,918,463
-----------------------------------------------------
$39,005,199
-----------------------------------------------------
</TABLE>
5 Financial Instruments
-------------------------------------------
The Portfolio regularly trades in financial instruments with off-balance
sheet risk in the normal course of its investing activities and to assist in
managing exposure to various market risks. These financial instruments
include written options, forward foreign currency contracts and financial
futures contracts and may involve, to a varying degree, elements of risk in
excess of the amounts recognized for financial statement purposes. The
notional or contractual amounts of these instruments represent the investment
the Portfolio has in particular classes of financial instruments and does not
necessarily represent the amounts potentially subject to risk. The
measurement of the risks associated with these instruments is meaningful only
when all related and offsetting transactions are considered. A summary of
obligations under these financial instruments at April 30, 2000 is as
follows:
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
<TABLE>
<CAPTION>
SALES
-------------------------------------------------------------------
SETTLEMENT IN EXCHANGE FOR NET UNREALIZED
DATE(S) DELIVER (IN U.S. DOLLARS) APPRECIATION
<S> <C> <C> <C>
-------------------------------------------------------------------
5/15/00 Euro
14,700,000 $ 14,066,430 $ 661,008
5/11/00 Japanese Yen
833,179,110 7,889,954 141,329
-------------------------------------------------------------------
$ 21,956,384 $ 802,337
-------------------------------------------------------------------
</TABLE>
20
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS CONT'D
<TABLE>
<CAPTION>
PURCHASES
-------------------------------------------------------------------
SETTLEMENT DELIVER NET UNREALIZED
DATE(S) IN EXCHANGE FOR (IN U.S. DOLLARS) DEPRECIATION
<S> <C> <C> <C>
-------------------------------------------------------------------
5/15/00 Australian Dollar
5,700,000 $ 3,404,040 $ (71,384)
-------------------------------------------------------------------
$ 3,404,040 $ (71,384)
-------------------------------------------------------------------
<CAPTION>
FUTURES CONTRACTS
-------------------------------------------------------------------
NET UNREALIZED
EXPIRATION APPRECIATION
DATE(S) CONTRACTS POSITION (DEPRECIATION)
<S> <C> <C> <C>
-------------------------------------------------------------------
6/00 35 Euro-Bond Long $ 49,307
6/00 12 Japanese Bond Short (146,343)
6/00 311 US Treasury Bond Short 212,977
-------------------------------------------------------------------
$ 115,941
-------------------------------------------------------------------
</TABLE>
At April 30, 2000, the Portfolio had sufficient cash and/or securities to
cover potential obligations arising from open futures and forward contracts,
as well as margin requirements on open futures contracts.
6 Federal Income Tax Basis of Investments (Unaudited)
-------------------------------------------
The cost and unrealized appreciation (depreciation) in value of the
investment securities at April 30, 2000, as computed on a federal income tax
basis, were as follows:
<TABLE>
<S> <C>
AGGREGATE COST $162,541,736
------------------------------------------------------
Gross unrealized appreciation $ 2,270,713
Gross unrealized depreciation (7,853,128)
------------------------------------------------------
NET UNREALIZED DEPRECIATION $ (5,582,415)
------------------------------------------------------
</TABLE>
21
<PAGE>
STRATEGIC INCOME PORTFOLIO AS OF APRIL 30, 2000
INDEPENDENT ACCOUNTANTS' REPORT
TO THE TRUSTEES AND INVESTORS
OF STRATEGIC INCOME PORTFOLIO:
---------------------------------------------
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and supplementary data present fairly, in all material
respects, the financial position of Strategic Income Portfolio (the "Portfolio")
at April 30, 2000, and the results of its operations, the changes in its net
assets, and the supplementary data for the periods presented, in conformity with
accounting principles generally accepted in the United States of America. These
financial statements and supplementary data (hereafter referred to as "financial
statements") are the responsibility of the Portfolio's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States of America which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at April 30, 2000 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 26, 2000
22
<PAGE>
EATON VANCE STRATEGIC INCOME FUND AS OF APRIL 30, 2000
INVESTMENT MANAGEMENT
EATON VANCE STRATEGIC INCOME FUND
Officers
James B. Hawkes
President and Trustee
William H. Ahern, Jr.
Vice President
Thomas J. Fetter
Vice President
Micheal R. Mach
Vice President
Armin J. Lang
Vice President
Robert B. MacIntosh
Vice President
Edward E. Smiley, Jr.
Vice President
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Trustees
Jessica M. Bibliowicz
President and Chief Executive Officer,
National Financial Partners
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking Emeritus, Harvard University
Graduate School of Business Administration
Norton H. Reamer
Chairman and Chief Executive Officer,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
Jack L. Treynor
Investment Adviser and Consultant
STRATEGIC INCOME PORTFOLIO
Officers
James B. Hawkes
President and Trustee
Mark S. Venezia
Vice President and
Portfolio Manager
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Trustees
Jessica M. Bibliowicz
President and Chief Executive Officer,
National Financial Partners
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment
Banking Emeritus, Harvard University
Graduate School of Business Administration
Norton H. Reamer
Chairman and Chief Executive Officer,
United Asset Management Corporation
Lynn A. Stout
Professor of Law,
Georgetown University Law Center
Jack L. Treynor
Investment Adviser and Consultant
23
<PAGE>
INVESTMENT ADVISER OF
STRATEGIC INCOME PROTFOLIO
BOSTON MANAGEMENT AND RESEARCH
The Eaton Vance Building
255 State Street
Boston, MA 02109
ADMINISTRATOR OF EATON VANCE
STRATEGIC INCOME FUND
EATON VANCE MANAGEMENT
Eaton Vance Management
255 State Street
Boston, MA 02109
PRINCIPAL UNDERWRITER
EATON VANCE DISTRIBUTORS, INC.
255 State Street
Boston, MA 02109
(617)482-8260
CUSTODIAN
INVESTORS BANK & TRUST COMPANY
200 Claredon Street
Boston, MA 02116
TRANSFER AND DIVIDEND DISBURSING AGENT
PFPC, INC.
Attention: Eaton Vance Funds
P.O. Box 9653
Providence, RI 02904-9653
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
160 Federal Street
Boston, MA 02110
EATON VANCE STRATEGIC INCOME FUND
THE EATON VANCE BUILDING
255 State Street
Boston, MA 02109
--------------------------------------------------------------------------------
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its distribution plan,
sales charges and expenses. Please read the prospectus carefully before you
invest or send money.
--------------------------------------------------------------------------------
028-6/00 SISRC-6/00
