<PAGE>
------------------------------------
Allmerica Financial Semi-Annual Report
--------------------------------------------------------------------------------
JUNE 30, 2000
Allmerica Investment Trust
. Money Market Fund
AIT
2000
[LOGO OF ALLMERICA FINANCIAL (R)]
<PAGE>
Table of Contents
General Information ...........................................................2
A Letter from the Chairman ....................................................3
Bond & Money Market Overview ..................................................4
Money Market Fund .............................................................6
Financials ..................................................................F-1
For further information, see the accompanying annual report.
See Client Notices on page F-10.
1
<PAGE>
General Information
Officers of First Allmerica Financial Life Insurance
Company (FAFLIC) and Allmerica Financial Life Insurance and Annuity Company
(AFLIAC)
John F. O'Brien, President, CEO (FAFLIC) and
Chairman of the Board (AFLIAC)
Richard M. Reilly, President and CEO (AFLIAC)
Edward J. Parry, III, Vice President, CFO and Treasurer
Abigail M. Armstrong, Secretary and Counsel
Investment Manager
Allmerica Financial Investment Management Services, Inc.
440 Lincoln Street, Worcester, MA 01653
General Distributor
Allmerica Investments, Inc.
440 Lincoln Street, Worcester, MA 01653
Independent Accountants
PricewaterhouseCoopers LLP
160 Federal Street, Boston, MA 02110
Administrator and Custodian
Investors Bank & Trust Company
200 Clarendon Street, Boston, MA 02116
Legal Counsel
Ropes & Gray
One International Place, Boston, MA02110
Officers of Allmerica Investment Trust (AIT)
Richard M. Reilly, President
Paul T. Kane, Treasurer
George M. Boyd, Secretary
Board of Trustees of AIT
John F. O'Brien, Chairman
P. Kevin Condrony/1/
Cynthia A. Hargadon/1/
Gordon Holmes/1/
John P. Kavanaugh
Bruce E. Langton/1/
Attiat F. Ott/1/
Richard M. Reilly
Ranne P. Warner/1/
/1/ ndependent Trustees
Investment Sub-Adviser
Allmerica Asset Management, Inc.
440 Lincoln Street, Worcester, MA 01653
2
<PAGE>
A Letter from the Chairman
[PHOTO]
Dear Client:
Investors were confronted with increased volatility during the first half of
2000. The U.S. Federal Reserve along with central banks worldwide raised
interest rates as continued economic growth led to concerns about inflation. The
GDP growth rate in the U.S. continued to exceed 5% causing Federal Reserve
policymakers to institute a series of three rate hikes in an effort to slow the
economy down. Subsequent economic reports of rising unemployment and declining
consumer spending reassured investors that growth was under control and the
Federal Reserve refrained from raising rates again in June.
Mirroring the U.S., international markets struggled also with rising interest
rates. Germany, Spain, and the U.K. were particularly pressured by the European
Central Bank's decision to raise rates to 4.25%. However, if the U.S. economy
continues to slow down, prospects for markets dominated by the Euro may improve.
Similarly, emerging market performance was driven by perceptions about the
direction of the U.S. economy. Performance improved, however, once economic data
began to suggest that the U.S. economy may be heading for a soft landing.
Increasing political and economic stability in countries such as Latin America,
Mexico, Brazil boosted the global economy while Japan continued its struggle
with relatively high unemployment and low consumer spending.
In an effort to control economic growth and head off inflation, the Federal
Reserve raised interest rates in February, March, and again in May. Long-term
Treasury yields declined in response to fewer new bond issues and the Treasury's
program to buy back over $30 billion in bonds during this year alone. The
combination of these events helped contribute to one of the worst performances
for non-Treasury issues in the bond market during the period.
Money market investors were fairly protected from rising interest rates as the
short-term nature of their investments quickly adapted to the new and higher
level of interest rates. For the first half of 2000, money market funds
continued to provide a safe haven for conservative investors.
The manager of the Allmerica Investment Trust (AIT) Money Market Fund continued
to produce highly competitive returns with a focus on preservation of capital,
maintenance of liquidity and attractive current income. Our fund continues to be
a top performer and we appreciate your confidence in the AIT Money Market Fund.
Through our broad array of insurance and retirement products, we look forward to
serving more of your financial needs.
On behalf of the Board of Trustees,
/S/ John F. O'Brien
John F. O'Brien
Chairman of the Board
Allmerica Financial Life Insurance and Annuity Company
3
<PAGE>
Bond & Money Market Overview
1996: Outlook for Federal Reserve policy affects U.S. bond market.
Long-predicted interest rate cuts, which would have fueled this market, never
occur.
1997: Low inflation and declining interest rates fuel the bond market, which
enjoys its best returns since 1995.
1998: During 1998, bond investments produced widely divergent results as a
series of dramatic swings either left them highly in favor or badly battered.
1999: Inflation concerns and a booming U.S. economy prompt the Federal Reserve
to hike interest rates. Fixed income markets close the second half with the
worst performing year ever.
2000: Bond investments suffer as a result of continued interest rate hikes by
the Federal Reserve in an effort to stave off inflation.
Events occurred during the first six months of 2000, which led to one of the
worst relative performances for corporate bonds, mortgage- and asset-backed
securities, and agencies (spread sectors). However, by June signs of an economic
slowdown began to emerge. Spread sectors rebounded as the Federal Reserve Board
decided to forego another interest rate increase at its June meeting.
Taking center stage was the inversion of the yield curve at the start of the
first quarter. Usually the longer a bond's maturity, the higher its yield. An
inverted yield curve is a demonstration of the opposite where shorter bonds
(with maturities of less than two years) produce higher yields. The yield curve
began to invert as a result of low issuance of new investment grade bonds and
the Treasury's quicker-than-expected announcement to buy back as much as $30
billion in bonds during this year alone. The Treasury's announcement took the
market by surprise and investors promptly bid up the price of the longer
maturity bonds, sending its yield below the Federal Funds rate by March. The
yield on the long bond ended the first quarter at 5.84%.
The yield curve inversion gathered momentum in the first quarter as the Federal
Reserve continued its efforts to slow down the economy by raising interest rates
in February and March by a total of .50%. Lower yields on Treasury bonds caused
corporate bonds, mortgage- and asset-backed securities, and agencies to
underperform. Concerns about the future of the economy caused spread sectors to
underperform as investors became unclear about future potential for revenue and
earnings growth and the impact on coverage of interest cost. Taxable bond mutual
funds saw over $30 billion in redemptions and overall asset allocation began to
favor the equity market.
[GRAPHIC]
2000
JAN
Treasury announces buy back of $30 billion in bonds, sending bond prices up and
yields down.
[GRAPHIC]
FEB
Federal Reserve raises interest rates by 0.25%. The yield curve begins to
invert.
MAR
Federal Reserve raises interest rates again by 0.25%. Volatile conditions shut
down issuance of investment grade bonds.
4
<PAGE>
Bond & Money Market Overview
In the meantime, unusual events took place in the mortgage-backed securities
market, affecting both agencies and mortgage-backed securities. Congressional
scrutiny over Fannie Mac and Freddie Mac, two major government-sponsored
enterprises, resulted in large-scale selling in the agencies and mortgage-backed
securities market.
By March, volatile market conditions virtually shut down new issuance of
investment grade bonds as investors' appetite for risk diminished. Supply and
demand within the fixed income marked moved out of alignment causing corporates
to underperform Treasuries by 227 basis points for the first quarter with March
producing the second worst monthly performance for spread product since 1990.
The Federal Reserve Board raised interest rates again in May by an additional
.50%, bringing the total tightening to 1.75% since June 1999. However, as the
second quarter progressed, the economy began to show signs of a slowdown.
Satisfied that interest rate hikes were beginning to have the desired effect,
the Federal Reserve voted to hold off on any further rate increases at their
June meeting.
Corporate bonds, mortgage- and asset-backed securities continued to dramatically
underperform U.S. Treasuries through May. The inverted yield curve persisted as
a result of the shrinking supply of U.S. Treasury securities and tightenings by
the Federal Reserve. Positive yield spreads were offset by negative price
returns as investment banks continued to diminish earnings volatility by
reducing their exposure to spread product. As Treasuries rallied in response to
the shrinking supply, spread sectors continued to underperform until June, when
the economy began to show signs that it may be headed for a soft landing. Once
the Federal Reserve decided to forego another interest rate hike, spread sector
performance began to gain, finally outperforming like-duration Treasuries by 50
basis points at the end of the second quarter.
The Federal Funds rate remains at 6.50%, the highest level since January 1991.
The goal of the Federal Reserve Board is to engineer a soft landing for the
economy, which translates as a slowdown in growth without entering into a
recession. The economy has begun to show signs of moderation. Retail sales have
declined and consumer spending on big-ticket items has slowed. The outlook for
spread sector performance is optimistic, especially if the Federal Reserve's
tightening cycle is coming to a close. However, the preliminary growth rate for
the annual gross domestic product stands at 5.2% as of June 2000. The Federal
Reserve considers a rate of 3.5% to 4% to be as fast as the economy can growth
without sparking inflation. The Federal Reserve remains cautious, and depending
upon whether or not the economy shows more definitive signs of a slowdown, may
consider another rate hike at their August meeting.
[GRAPHIC]
APR
Spread sectors continue to dramatically underperform U.S. Treasuries.
MAY
Federal Reserve raises interest rates by another 0.50% to 6.50%. The inverted
yield curve persists as a result of the shrinking supply of U.S. Treasuries and
continued rate hikes.
[GRAPHIC]
JUN
Federal Reserve votes to hold off on additional interest rate increases.
Corporates and Mortgages outperform like-duration Treasuries due to signs of a
slowing economy.
5
<PAGE>
Money Market Fund
The Money Market Fund returned 3.02% for the first half of the year,
outperforming its benchmark, the iMoneyNet, Inc. Index*, which returned 2.71%
for the same period.
During the period, the bond market saw one of the worst relative performances
ever recorded. Early in the year the yield curve, where long-term rates usually
exceed short-term rates, began to invert. Long-term Treasury yields declined in
response to the Treasury's buyback program and curtailment of the issue of new
Treasuries. This, in combination with the Federal Reserve's continued interest
rate hikes contributed to the yield curve inversion. Federal Reserve
policymakers acted on concerns about inflation, the trade deficit, and the
effect of rising personal wealth on consumer spending and borrowing.
During the first quarter, the Fund benefited from an increase in floating note
rates. Such notes have variable rates, which reset periodically and enable the
Fund to more fully participate in higher interest rates. Strong consumer
spending, especially in housing and cars, coupled with job growth favored supply
of these notes. In the second quarter, inflation fears lessened somewhat when
the Federal Reserve decided against raising rates, and the Fund's manager
increased holdings of corporate notes with longer maturities and commercial
paper characterized by flexibility and safety and issued by top-rated firms.
Those positions, along with government agency securities and repurchase
agreements, which have shorter maturities, were included to maximize liquidity
for the portfolio.
For the remainder of 2000, the Fund's manager will maintain these core holdings,
considering possible reallocations if interest rate policies appear to have
effected a slowdown in economic growth.
* Formerly IBC Donoghue, this represents a name change only.
Investment Sub-Adviser
Allmerica Asset Management, Inc.
About the Fund
Strives to maximize current income for investors while preserving capital and
liquidity.
Portfolio Composition
[GRAPH]
As of June 30, 2000, the sector allocation of net assets was:
Corporate Notes 47%
Commercial Paper 30%
U.S. Govt &
Agency Obligations 7%
Municipal 5%
Other 11%
Average Annual Total Returns
Years ended June 30, 2000 1 Year 5 Years 10 Years
Money Market Fund 5.73% 5.51% 5.15%
iMoneyNet, Inc.* 5.16% 4.97% 4.67%
Lipper Money Market Funds Average 5.06% 4.91% 4.68%
*Formerly IBC Donoghue, this represents a name change only.
Average Yield as of June 30, 2000
Money Market Fund 7-Day Yield 6.51%
Growth of a $10,000 Investment Since 1990
[GRAPH]
Money Market Fund iMoneyNet, Inc.
--------------------------------------------------------------------------------
6/30/90 10,000 10,000
12/31/90 10,399 10,374
12/31/91 10,995 10,963
12/31/92 11,411 11,328
12/31/93 11,753 11,626
12/31/94 12,175 12,055
12/31/95 12,886 12,711
12/31/96 13,576 13,332
12/31/97 14,255 13,999
12/31/98 15,040 14,693
12/31/99 15,821 15,365
6/30/00 16,299 15,781
The Money Market Fund is a portfolio of the Allmerica Investment Trust.
Portfolio composition will vary over time. The Fund is neither insured nor
guaranteed the Federal Deposit Insurance Corporation or any other Government
Agency. Although the Fund seeks to maintain a net asset value of $1.00 per
share, it is possible to lose money by investing in the Fund. Past performance
is no guarantee of future results. Investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. iMoneyNet, Inc. is an independent
firm that tracks 2a-7 regulated money market funds on a yield, shareholder,
asset size and portfolio allocation basis. The Lipper Money Market Funds Average
is the average investment performance of 364 funds within the Money Market
category. Performance numbers are net of all fund operating expenses, but do not
include insurance charges. If performance information included the effect of
these additional charges, it would have been lower.
6
<PAGE>
Financials
<PAGE>
This page left blank intentionally.
<PAGE>
Money Market Fund
PORTFOLIO OF INVESTMENTS . June 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Par Value (Note 2)
<C> <S> <C>
--------------------------------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS (c) -
7.1%
Fannie Mae - 4.6%
$5,000,000 5.62%, 09/01/00 $4,951,607
10,000,000 6.53%, 09/01/00 9,887,539
5,000,000 6.57%, 09/01/00 4,943,425
----------
19,782,571
----------
Federal Farm Credit Bank - 0.2%
1,000,000 6.34%, 05/07/01(a) 1,000,000
----------
Sallie Mae - 2.3%
10,000,000 6.28%, 03/09/01(a) 10,002,563
----------
Total U.S. Government and
Agency Obligations 30,785,134
----------
CORPORATE NOTES - 46.8%
Automotive - 3.2%
6,000,000 American Honda Finance Corp.
6.78%, 08/02/00(b) 5,999,899
5,000,000 General Motors Acceptance Corp., MTN
6.80%, 04/17/01 4,981,271
3,000,000 Paccar Financial Corp., MTN
6.08%, 05/15/01 2,967,816
----------
13,948,986
----------
Banking - 6.8%
2,500,000 African Development Bank
8.73%, 05/01/01 2,536,157
10,000,000 Asset Backed Capital Financial
6.44%, 03/15/01(a) 10,000,000
9,000,000 First Union National Bank
6.86%, 09/27/00(a) 8,998,367
2,750,000 FleetBoston Financial Corp., MTN
6.38%, 08/11/00 2,750,270
5,000,000 PNC Funding Corp.
9.88%, 03/01/01 5,092,735
----------
29,377,529
----------
Electric Utilities - 0.2%
1,000,000 National Rural Utilities, MTN
5.88%, 07/28/00 999,655
----------
Financial Services - 19.2%
1,000,000 Countrywide Funding Corp.
7.31%, 08/28/00 1,001,628
5,000,000 Countrywide Home Loans
5.62%, 10/16/00 4,984,954
10,000,000 Countrywide Home Loans, MTN
6.77%, 05/22/01(a) 9,997,832
7,000,000 Heller Financial, Inc.
6.49%, 09/18/00 6,998,527
10,000,000 Heller Financial, Inc.
6.90%, 08/07/00(a) 9,999,466
</TABLE>
<TABLE>
<CAPTION>
Value
Par Value (Note 2)
<C> <S> <C>
-------------------------------------------------------------------
Financial Services - (continued)
$2,500,000 Heller Financial, Inc.
7.10%, 09/25/00(a) $ 2,501,802
12,000,000 Household Finance Corp., MTN
6.37%, 03/30/01(a) 12,000,000
1,000,000 Household Finance Corp., MTN
6.89%, 06/21/01(a) 1,000,690
10,000,000 Links Finance LLC
6.66%, 03/30/01(a) 9,997,759
10,000,000 Links Finance LLC, MTN
7.00%, 06/04/01(b) 10,000,000
10,000,000 Sigma Finance, Inc.
6.39%, 03/30/01(a) 10,000,000
5,000,000 Syndicated Loan Fund Trust
6.53%, 03/30/01(a) 5,000,000
-----------
83,482,658
-----------
Real Estate - 5.3%
23,000,000 Homeside Lending, Inc., MTN
6.93%, 08/16/00(a) 23,000,578
-----------
Securities Broker - 11.5%
5,000,000 Bear Stearns Cos., Inc., MTN
6.39%, 02/02/01(a) 5,000,000
1,300,000 Goldman Sachs and Co.
5.56%, 01/11/01(b) 1,294,926
10,000,000 Goldman Sachs Group, Inc.
6.82%, 08/16/00 10,000,000
7,000,000 Lehman Brothers Holdings, Inc.
7.29%, 09/25/00 7,012,175
675,000 Merrill Lynch & Co., Inc.
6.70%, 08/01/00 675,372
5,000,000 Merrill Lynch & Co., Inc., MTN
7.32%, 11/20/00(a) 5,009,866
10,000,000 Morgan Stanley Dean Witter & Co., MTN
6.88%, 08/09/00(a) 10,004,076
10,000,000 Paine Webber Group, Inc.
6.82%, 12/12/00(a) 10,000,000
1,000,000 Salomon Smith Barney Holdings, Inc., MTN
6.63%, 11/30/00 1,001,262
-----------
49,997,677
-----------
Telephone Systems - 0.6%
2,356,000 GTE Corp.
9.38%, 12/01/00 2,381,616
-----------
Total Corporate Notes 203,188,699
-----------
COMMERCIAL PAPER (c) - 29.5%
Banking - 4.5%
10,000,000 Bank of America Corp.
6.65%, 08/23/00 9,902,097
10,000,000 Christiania Capital Corp.
6.66%, 09/12/00 9,865,051
-----------
19,767,148
-----------
</TABLE>
See Notes to Financial Statements.
--------------------------------------------
F-1
<PAGE>
Money Market Fund
PORTFOLIO OF INVESTMENTS, Continued . June 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Par Value (Note 2)
<C> <S> <C>
----------------------------------------------------------------
Electric Utilities - 6.6%
$10,000,000 Carolina Power & Light Co.
6.70%, 08/14/00 $ 9,918,111
8,899,000 Oglethorpe Power Corp.
6.61%, 07/06/00 8,890,830
10,000,000 Oglethorpe Power Corp.
6.75%, 08/01/00 9,941,875
------------
28,750,816
------------
Electrical Equipment - 3.9%
17,000,000 Xerox Corp.
7.25%, 07/05/00 16,986,306
------------
Financial Services - 3.2%
5,000,000 Govco, Inc.
6.70%, 08/11/00 4,961,847
9,000,000 Westways Funding IV
6.67%, 09/07/00 8,886,610
------------
13,848,457
------------
Insurance - 3.4%
15,000,000 Aetna Services, Inc.
6.80%, 08/21/00 14,855,500
------------
Real Estate - 3.4%
15,000,000 Weyerhaeuser Real Estate
7.22%, 07/05/00(b) 14,987,967
------------
Securities Broker - 3.3%
6,000,000 Bear Stearns Cos., Inc.
6.89%, 02/12/01 5,740,477
7,000,000 Donaldson, Lufkin & Jenrette, Inc.
6.77%, 08/14/00 6,942,079
1,500,000 Paine Webber Group, Inc.
7.10%, 07/03/00 1,499,408
------------
14,181,964
------------
Telephone Systems - 1.2%
5,000,000 AT & T Corp.
7.27%, 06/14/01 5,000,000
------------
Total Commercial Paper 128,378,158
------------
CERTIFICATES OF DEPOSIT - 3.9%
10,000,000 CIC Floating Rate CD
6.82%, 08/02/00(a) 9,999,829
7,000,000 Wilmington Trust Corp.
6.02%, 10/02/00 6,998,987
------------
Total Certificates of Deposit 16,998,816
------------
</TABLE>
<TABLE>
<CAPTION>
Value
Par Value (Note 2)
<C> <S> <C>
---------------------------------------------------------------------------
ASSET-BACKED AND MORTGAGE-BACKED SECURITIES - 1.3%
$ 676,417 Fidelity Equipment Lease Trust,
Series 1999-2, Class A-1, CMO
6.13%, 12/15/00 $ 676,417
1,941,812 Household Automotive Trust IV,
Series 2000-1, Class A1, CMO
6.09%, 03/19/01 1,941,812
3,012,052 Huntington Auto Trust,
Series 2000-A, Class A1, CMO
6.32%, 04/15/01 3,012,052
------------
Total Asset-Backed and
Mortgage-Backed Securities 5,630,281
------------
MUNICIPAL OBLIGATIONS - 4.8%
20,000,000 California Housing Finance Agency,
Revenue Bond
6.68%, 08/01/31(a) 20,000,000
1,000,000 New Jersey State Municipal
6.38%, 08/01/00 1,000,585
------------
Total Municipal Obligations 21,000,585
------------
<CAPTION>
Shares
------
<C> <S> <C>
INVESTMENT COMPANIES - 1.3%
5,479,035 Scudder Institutional Money Market Fund 5,479,035
10,990 SSgA Prime Money Market Fund 10,990
------------
Total Investment Companies 5,490,025
------------
<CAPTION>
Maturity
Amount
--------
<C> <S> <C>
REPURCHASE AGREEMENTS - 4.6%
$20,011,917 First Union Securities, Inc. Repurchase
Agreement, dated 06/30/00, due 07/03/00, at
7.15%, collateralized by First Union National
Bank, 7.70%, 02/15/05 with a market value of
$20,000,000. 20,000,000
------------
Total Investments - 99.3% 431,471,698
------------
Net Other Assets and Liabilities - 0.7% 3,024,880
------------
Total Net Assets - 100.0% $434,496,578
============
</TABLE>
------------------
(a) Variable rate security. The rate shown reflects rate in effect at June 30,
2000.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration,
to qualified institutional buyers. At June 30, 2000, these securities
amounted to $32,282,792 or 7.4% of net assets.
(c) Effective yield at time of purchase.
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
FEDERAL INCOME TAX INFORMATION (SEE NOTE 2)
At June 30, 2000, the aggregate cost of investment securities for tax purposes
was $431,471,698.
See Notes to Financial Statements.
------------------------------------------------------
F-2
<PAGE>
Allmerica Investment Trust
STATEMENT OF ASSETS AND LIABILITIES (in 000's) . June 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Money
Market
Fund
-------------------------------------------------------------------------------
<S> <C>
ASSETS:
Total investments at value.......................................... $431,472
Cash ............................................................... 5
Interest and dividend receivables................................... 3,237
--------
Total Assets....................................................... 434,714
--------
LIABILITIES:
Advisory fee payable................................................ 82
Dividends payable................................................... 78
Accrued expenses and other payables................................. 58
--------
Total Liabilities.................................................. 218
--------
NET ASSETS.......................................................... $434,496
========
NET ASSETS consist of
Paid-in capital..................................................... $434,684
Accumulated (distribution in excess of) net realized gain (loss) on
investments sold................................................... (188)
--------
TOTAL NET ASSETS.................................................... $434,496
========
Shares of beneficial interest outstanding (unlimited authorization,
no par value) (in 000's)........................................... 434,686
NET ASSET VALUE,
Offering and redemption price per share (Net Assets/Shares
Outstanding)....................................................... $ 1.000
========
</TABLE>
See Notes to Financial Statements.
--------------------------------------------
F-3
<PAGE>
Allmerica Investment Trust
STATEMENT OF OPERATIONS (in 000's) . For the Six Months Ended June 30, 2000
(Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Money
Market
Fund
---------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Interest............................................................ $ 13,324
---------
EXPENSES
Investment advisory fees............................................ 513
Custodian and Fund accounting fees.................................. 59
Legal fees.......................................................... 5
Audit fees.......................................................... 11
Trustees' fees and expenses......................................... 6
Reports to shareholders............................................. 25
Miscellaneous....................................................... 4
---------
Total expenses ..................................................... 623
---------
NET INVESTMENT INCOME ............................................... 12,701
---------
NET REALIZED GAIN (LOSS) ON INVESTMENTS.............................. (91)
---------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................. $ 12,610
=========
</TABLE>
See Notes to Financial Statements.
------------------------------------------------------
F-4
<PAGE>
Allmerica Investment Trust
STATEMENTS OF CHANGES IN NET ASSETS (in 000's)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Money Market
Fund
-------------------------------------------------------------------------------
Six Months
Ended June 30, Year Ended
2000 December 31,
(Unaudited) 1999
-------------------------------------------------------------------------------
<S> <C> <C>
NET ASSETS at beginning of period................. $ 513,606 $ 336,253
---------- ---------
Increase (decrease) in net assets resulting from
operations:
Net investment income............................ 12,701 21,479
Net realized gain (loss) on investments sold..... (91) --
---------- ---------
Net increase in net assets resulting from
operations...................................... 12,610 21,479
---------- ---------
Distributions to shareholders from net investment
income........................................... (12,701) (21,479)
---------- ---------
Capital share transactions:
Net proceeds from sales of shares................ 1,104,672 1,057,803
Issued to shareholders in reinvestment of
distributions................................... 12,701 21,479
Cost of shares repurchased....................... (1,196,392) (901,929)
---------- ---------
Net increase (decrease) from capital share
transactions................................... (79,019) 177,353
---------- ---------
Total increase (decrease) in net assets......... (79,110) 177,353
---------- ---------
NET ASSETS at end of period....................... $ 434,496 $ 513,606
========== =========
OTHER INFORMATION:
Share transactions:
Sold............................................. 1,104,672 1,057,803
Issued to shareholders in reinvestment of
distributions................................... 12,701 21,479
Repurchased...................................... (1,196,392) (901,929)
---------- ---------
Net increase (decrease) in shares outstanding... (79,019) 177,353
========== =========
</TABLE>
See Notes to Financial Statements.
--------------------------------------------
F-5
<PAGE>
Allmerica Investment Trust
FINANCIAL HIGHLIGHTS . For a Share Outstanding Throughout Each Period
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Income from Investment Operations Less Distributions
-------------------------------------------- ------------------------------------------------------------
Net Realized
Net and
Asset Unrealized Dividends Distributions
Value Net Gain (Loss) Total from from Net from Net Distributions Return
Year Ended Beginning Investment on Investment Investment Realized in of Total
December 31, of Period Income Investments Operations Income Capital Gains Excess Capital Distributions
------------ --------- ---------- ------------ ---------- ---------- ------------- ------------- ------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Money Market Fund
2000(d) 1.000 0.030 -- 0.030 (0.030) -- -- -- (0.030)
1999 1.000 0.051 -- 0.051 (0.051) -- -- -- (0.051)
1998 1.000 0.054 -- 0.054 (0.054) -- -- -- (0.054)
1997 1.000 0.053 -- 0.053 (0.053) -- -- -- (0.053)
1996 1.000 0.052 -- 0.052 (0.052) -- -- -- (0.052)
1995 1.000 0.057 -- 0.057 (0.057) -- -- -- (0.057)
<CAPTION>
Net
Increase
(Decrease)
in
Year Ended Net Asset
December 31, Value
------------ ----------
<S> <C>
Money Market Fund
2000(d) --
1999 --
1998 --
1997 --
1996 --
1995 --
</TABLE>
------------------
* Annualized.
** Not Annualized.
(a) Including reimbursements and reductions.
(b) Excluding reductions. Certain Portfolios have entered into varying arrange-
ments with brokers who reduced a portion of the Portfolio's expenses.
(c) Excluding reimbursements and reductions.
(d) For the six months ended June 30, 2000 (Unaudited).
See Notes to Financial Statements.
------------------------------------------------------
F-6
<PAGE>
Allmerica Investment Trust
<TABLE>
<CAPTION>
Ratios/Supplemental Data
----------------------------------------------------------------
Ratios To Average Net Assets
--------------------------------------------
Net Assets
Net Asset End of Net Operating Management Portfolio
Value End Total Period Investment Expenses Fee Turnover
of Period Return (000's) Income (a) (b) (c) Gross Net Rate
--------- ------ ---------- ---------- ---- ---- ---- ----- ---- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1.000 3.02%** 434,496 5.96%* 0.29%* 0.29%* 0.29%* 0.24%* 0.24%* N/A
1.000 5.19% 513,606 5.09% 0.29% 0.29% 0.29% 0.24% 0.24% N/A
1.000 5.51% 336,253 5.36% 0.32% 0.32% 0.32% 0.26% 0.26% N/A
1.000 5.47% 260,620 5.33% 0.35% 0.35% 0.35% 0.27% 0.27% N/A
1.000 5.36% 217,256 5.22% 0.34% 0.34% 0.34% 0.28% 0.28% N/A
1.000 5.84% 155,211 5.68% 0.36% -- 0.36% 0.29% 0.29% N/A
</TABLE>
--------------------------------------------
F-7
<PAGE>
Allmerica Investment Trust
NOTES TO FINANCIAL STATEMENTS (Unaudited)
--------------------------------------------------------------------------------
1.ORGANIZATION
Allmerica Investment Trust (the "Trust") is registered under the Investment
Company Act of 1940 ("the 1940 Act"), as amended, as an open-end, diversified
management investment company established as a Massachusetts business trust.
The Trust is intended to serve as an investment medium for (i) variable life
insurance policies and variable annuity contracts offered by insurance compa-
nies, (ii) certain qualified pension and retirement plans, as permitted by
Treasury Regulations; and (iii) life insurance companies and advisers to the
Portfolios and their affiliates. The Trust is comprised of fourteen managed
investment portfolios. The accompanying financial statements and financial
highlights are those of the Money Market Fund (the "Portfolio").
2.SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions at
the date of the financial statements. Actual results could differ from those
estimates.
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements:
Security Valuation: Securities of the Portfolio are valued utilizing the amor-
tized cost valuation method, permitted in accordance with Rule 2a-7 under the
1940 Act. This method involves valuing a portfolio security initially at its
cost and thereafter assuming a constant amortization to maturity of any dis-
count or premium.
Security Transactions and Investment Income: Security transactions are recorded
as of trade date. Realized gains and losses from security transactions are
determined on the basis of identified cost. Interest income, including amorti-
zation of premium and accretion of discount on securities, is accrued daily.
Income distributions earned by the Portfolio from investments in certain
investment companies are recorded as interest income in the accompanying finan-
cial statements.
Federal Income Taxes: The Trust treats each Portfolio as a separate entity for
Federal income tax purposes. The Portfolio intends to continue to qualify as a
"regulated investment company" under Subchapter M of the Internal Revenue Code
of 1986, as amended. By so qualifying, the Portfolio will not be subject to
Federal income taxes to the extent it distributes all of its taxable income and
net realized gains, if any, for its fiscal year. In addition, by distributing
during each calendar year substantially all of its net investment income, capi-
tal gains and certain other amounts, if any, the Portfolio will not be subject
to Federal excise tax. Therefore, no Federal income tax provision is required.
Distributions to Shareholders: Dividends from net investment income are
declared and reinvested daily for the Portfolio. The Portfolio declares and
distributes all net realized capital gains, if any, at least annually. Distri-
butions to shareholders are recorded on ex-dividend date.
Expenses: The Trust accounts separately for assets, liabilities and operations
of each Portfolio. Expenses directly attributed to a Portfolio are charged to
the Portfolio, while expenses which are attributable to more than one Portfolio
of the Trust are allocated among the respective Portfolios.
Forward Commitments: The Portfolio may enter into contracts to purchase securi-
ties for a fixed price at a specified future date beyond customary settlement
time ("forward commitments"). If the Portfolio does so, it will maintain cash
or other liquid obligations having a value in an amount at all times sufficient
to meet the purchase price. Forward commitments involve a risk of loss if the
value of the security to be purchased declines prior to the settlement date.
Although the Portfolio generally will enter into forward commitments with the
intention of acquiring securities for its portfolio, it may dispose of a com-
mitment prior to settlement date if its Sub-Adviser deems it appropriate to do
so.
------------------------------------------------------
F-8
<PAGE>
Allmerica Investment Trust
NOTES TO FINANCIAL STATEMENTS (Unaudited), Continued
--------------------------------------------------------------------------------
Repurchase Agreements: The Portfolio may engage in repurchase agreement trans-
actions with institutions that the Portfolio Manager has determined are credit-
worthy pursuant to guidelines established by the Trust's Board of Trustees.
Each repurchase agreement transaction is recorded at cost. The Portfolio
requires that the securities purchased in a repurchase agreement transaction be
transferred to the Trust's Custodian in a manner that is intended to enable the
Portfolio to obtain those securities in the event of a counterparty default.
The Portfolio Manager monitors the value of the securities, including accrued
interest, daily to ensure that the value of the collateral equals or exceeds
amounts due under the repurchase agreement. Repurchase agreement transactions
involve certain risks in the event of default or insolvency of the
counterparty, including possible delays or restrictions upon the Portfolio's
ability to dispose of the underlying securities, and a possible decline in the
value of the underlying securities during the period while the Portfolio seeks
to assert its rights.
3.MANAGEMENT ADVISORY, ADMINISTRATION, AND OTHER RELATED PARTY TRANSACTIONS
Allmerica Financial Investment Management Services, Inc. (the "Manager"), a
wholly-owned subsidiary of First Allmerica Financial Life Insurance Company
("First Allmerica"), serves as investment manager and administrator to the
Trust. Under the terms of the management agreement, the Portfolio pays a man-
agement fee, calculated daily and payable monthly, at an annual rate based upon
the following fee schedule:
<TABLE>
<CAPTION>
Percentage of Average Daily Net Assets
First Next Over
Portfolio $50,000,000 $200,000,000 $250,000,000
-------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Money Market 0.35% 0.25% 0.20%
</TABLE>
The Manager has entered into a Sub-Adviser Agreement for the management of the
investments of the Portfolio. The Manager is solely responsible for the payment
of all fees to the Sub-Adviser. The Sub-Adviser for the Portfolio is Allmerica
Asset Management, Inc, a wholly-owned subsidiary of First Allmerica.
Investors Bank & Trust Company ("IBT") provides portfolio accounting and cus-
tody services to the Trust and receives fees and reimbursement of certain out-
of-pocket expenses for its services from the Trust. The Manager has entered
into an Administrative Services Agreement with IBT, whereby IBT performs cer-
tain administrative services for the Portfolio and is entitled to receive an
administrative fee and certain out-of-pocket expenses. The Manager is solely
responsible for the payment of the administrative fee to IBT. The Trust pays no
salaries or compensation to any of its officers. Trustees who are not direc-
tors, officers or employees of the Trust or any investment adviser are reim-
bursed for their travel expenses in attending meetings of the Trustees, and
receive quarterly meeting and retainer fees for their services. Such amounts
are paid by the Trust.
4.REIMBURSEMENT OF EXPENSES
In the event normal operating expenses of the Portfolio, excluding taxes,
interest, broker commissions, and extraordinary expenses, but including the
advisory fee, exceed 0.60% of average net assets, the Manager will voluntarily
reimburse fees and any expenses in excess of the expense limitation. The
expense limitation may be removed or revised at any time after the Portfolio's
first fiscal year of operations without prior notice to existing shareholders.
5.SHARES OF BENEFICIAL INTEREST
The Trust's Declaration of Trust authorizes the Trustees to issue an unlimited
number of shares of beneficial interest for the Portfolios, each without a par
value.
6.FOREIGN SECURITIES
The Portfolio may invest in only U.S. dollar denominated foreign securities.
Investing in foreign securities involves special risks not typically associated
with investing in securities of U.S. issuers. The risks include revaluation of
currencies and future adverse political and economic developments. Moreover,
securities of many foreign issuers and their markets may be less liquid and
their prices more volatile than those of securities of comparable U.S. issuers.
--------------------------------------------
F-9
<PAGE>
Allmerica Investment Trust
REGULATORY DISCLOSURES
--------------------------------------------------------------------------------
The performance data quoted represents past performance and the investment
return and principal value of an investment will fluctuate so that an invest-
or's shares, when redeemed, may be worth more or less than their original cost.
An investment in the Money Market Fund is not insured or guaranteed by the Fed-
eral Deposit Insurance Corporation or any other government agency. Although the
Portfolio seeks to preserve the value of your investment at a stable net asset
value of $1.00 per share, it is possible to lose money by investing in the
Portfolio.
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Portfolio and are not authorized
for distribution to prospective investors in the flexible premium variable life
insurance or annuity products of Allmerica Financial Life Insurance and Annuity
Company or First Allmerica Financial Life Insurance Company unless accompanied
or preceded by effective prospectuses for the flexible premium variable life
insurance or annuity products of Allmerica Financial Life Insurance and Annuity
Company or First Allmerica Financial Life Insurance Company and Allmerica
Investment Trust which include important information related to charges and
expenses.
CLIENT NOTICES
--------------------------------------------------------------------------------
This report includes financial statements for Allmerica Investment Trust. It
does not include financial statements for the separate accounts.
------------------------------------------------------
F-10
<PAGE>
[LOGO OF ALLMERICA]
First Allmerica Financial Life Insurance Company . Allmerica Financial Life
Insurance and Annuity Company (licensed in all states except NY)
Allmerica Trust Company, N.A. . Allmerica Investments, Inc.
Allmerica Investment Management Company, Inc. The Hanover Insurance Company
AMGRO, Inc. Allmerica Financial Alliance Insurance Company
Allmerica Asset Management, Inc. . Allmerica Financial Benefit Insurance Company
Sterling Risk Management Services, Inc. Citizens Corporation
Citizens Insurance Company of America . Citizens Management Inc.
440 Lincoln Street, Worcester, Massachusetts 01653
11129 (6/00)
