<PAGE>
[LOGO OF SENTINEL
APPEARS HERE]
Sentinel
Family of
Funds
Semi-Annual
Report
May 31, 1996
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[LOGO OF SENTINEL Sentinel Group Funds, Inc. (SGF)
GROUP FUND Sentinel Pennsylvania
APPEARS HERE] Tax-Free Trust (PA)
National Life Drive,
Montpelier, Vermont 05604
(800) 282-FUND(3863)
--------------------------------------------------
Table of Contents
2 Message to Shareholders
4 Financial Statements
4 Sentinel Emerging Growth Fund
7 Sentinel Growth Fund
10 Sentinel World Fund
13 Sentinel Common Stock Fund
16 Sentinel Balanced Fund
20 Sentinel Bond Fund
23 Sentinel Tax-Free Income Fund
27 Sentinel New York Tax-Free Income Fund
30 Sentinel Government Securities Fund
33 Sentinel Short-Intermediate Government Fund
36 Sentinel U.S. Treasury Money Market Fund
39 SGF Notes to Financial Statements
44 SGF Financial Highlights
55 Financial Statements
55 Sentinel Pennsylvania Tax-Free Trust
58 PA Notes to Financial Statements
60 PA Financial Highlights
61 Privileges, Plans and Services for Shareholders
63 Directors/Trustees and Officers
64 A Brief History
The financial statements included herein have been
taken from the records of the Funds/Trust without
audit by the independent accountants and
accordingly they do not express an opinion thereon.
<PAGE>
Message to Shareholders
[PHOTO OF KENISTON P. [PHOTO OF JOSEPH M.
MERRILL APPEARS HERE] ROB APPEARS HERE]
Keniston P. Merrill Joseph M. Rob
Chairman President
Dear Shareholder:
We are pleased to submit our semi-annual report for the six months ended
May 31, 1996.
The Economy
The widely held view at the beginning of this year that slow growth and moderate
inflation would cause long-term interest rates to fall has given way to concerns
about faster growth and renewed inflation. Indeed, the 2.3% increase in Real
Gross Domestic Product (GDP) during the first quarter of 1996 was in sharp
contrast to the anemic 0.5% GDP growth rate for 1995's final quarter.
While it may be premature to conclude that the U.S. economy is on a fast growth
track, an uptick in inflation remains a real possibility over the near term.
Amidst an extended period of near full employment and modest income growth, a
resumption in economic activity could lead to higher wage gains. Although many
have dismissed recent increases in petroleum and grain prices as transitory, low
inventory levels and increased worldwide demand for these commodities suggests
that the impact on price levels could be significant. Attempts by businesses to
rebuild inventories this summer could also accelerate the economy's rate of
growth and put pressure on producer prices.
The bond market has struggled in 1996, reacting to the news of better-than-
anticipated consumer spending and employment statistics which have heightened
inflation expectations. To some degree, however, the recent run-up in long-term
rates may have a self-correcting influence on the economy, as higher interest
rates are likely to have a negative impact on housing activity. In aggregate,
spending by debt-laden consumers seems likely to slow in the second half of
1996, after exceeding expectations so far this year. Current real interest rates
of close to 4% appear high by historical standards. We expect the recent
strength in the economy to ebb as the year wears on, and see interest rates
trending lower as evidence of more moderate growth materializes.
In sum, we still see continued growth in GDP of 2.0-2.5% for 1996, with
corporate earnings rising by 8-10% and inflation, as measured by the Consumer
Price Index (CPI), accelerating modestly to about 3%.
The Financial Markets
Despite some attempts to rally, the fixed-income markets have failed to rebound
fully in the wake of this year's "growth scare." However, the equity markets
have continued to move higher, in part because of the favorable prospects for
corporate profits, but also in response to the strong inflows into mutual funds
that have driven the demand for stocks. The market has rotated swiftly from
sector to sector this year, with only the utilities showing meaningful
underperformance relative to the broad market. The most economically sensitive
consumer, industrial and technology sectors have been among the stronger
performers. Also, above average profit growth by small and mid-cap stocks has
led to a strong performance by these shares relative to large, blue-chip issues.
Although the current environment for investing remains generally constructive,
equities have appreciated to a level where, based on traditional valuation
measures, our enthusiasm is tempered. We are concerned that recent rapid sector
rotation, an increased emphasis on short-term
<PAGE>
performance and a record number of initial public offerings (IPOs), are
signs that the current investment climate has become more speculative in nature.
The exceptional gains registered by the stock market averages in 1995 will be
difficult to match again this year, in our opinion, despite an already
impressive year-to-date performance. As always, we will continue to emphasize
fundamentals, investment quality, relative valuation and portfolio
diversification in our attempt to control risk in meeting our shareholders'
long-term investment objectives.
We appreciate your support and look forward to continuing to help you achieve
your long-term investment goals.
Sincerely,
/s/ Keniston P. Merrill /s/ Joseph M. Rob
Keniston P. Merrill Joseph M. Rob
Chairman President
May 31, 1996
- --------------------------------------------------------------------------------
Fund Performance
Performance data for each Sentinel Fund is provided in this table. Financial
data is contained in the following pages.
<TABLE>
<CAPTION>
11/30/95 - 5/31/96
-------------------------------------------------------------------------
5/31/96
Net Asset Capital
Sentinel Value Per Income Gain Total Lipper
Fund Share Dividends Distributions Return* Average**
<S> <C> <C> <C> <C> <C> <C>
Emerging Growth "A" Shares $ 5.04 $.03 $ .96 18.9% 21.0%
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 5.02 .00 .- 4.2 .-
- ------------------------------------------------------------------------------------------------------------------------------
Growth 16.18 .07 2.55 12.9 12.1
- ------------------------------------------------------------------------------------------------------------------------------
World "A" Shares 14.92 .13 .07 9.8 10.5
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 14.89 .00 .- 2.8 .-
- ------------------------------------------------------------------------------------------------------------------------------
Common Stock "A" Shares 35.92 .32 2.77 11.6 11.0
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 35.88 .00 .- 1.3 .-
- ------------------------------------------------------------------------------------------------------------------------------
Balanced "A" Shares 17.15 .27 .41 6.1 6.4
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 17.12 .00 .- 0.2 .-
- ------------------------------------------------------------------------------------------------------------------------------
Bond "A" Shares 6.15 .21 .- -2.0 -2.0
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 6.16 .05 .- -1.4 .-
- ------------------------------------------------------------------------------------------------------------------------------
Government Securities 9.74 .30 .- -2.5 -2.4
- ------------------------------------------------------------------------------------------------------------------------------
Tax-Free Income "A" Shares 13.08 .33 .- -1.6 -1.2
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 13.09 .09 .- -0.8 .-
- ------------------------------------------------------------------------------------------------------------------------------
PA Tax-Free Trust 12.83 .33 .08 -1.2 -0.9
- ------------------------------------------------------------------------------------------------------------------------------
Short-Intermediate Government 9.65 .28 .- 0.9 1.0
- ------------------------------------------------------------------------------------------------------------------------------
NY Tax-Free Income 11.25 .26 .- -1.8 -1.4
- ------------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Money Market "A" Shares 1.00 .02 .- 2.3 -
- ------------------------------------------------------------------------------------------------------------------------------
# "B" Shares 1.00 .01 .- 0.7 -
- ------------------------------------------------------------------------------------------------------------------------------
Standard & Poor's 500/+/ - - .- 11.8 -
- ------------------------------------------------------------------------------------------------------------------------------
Russell 2000 Index/++/ - - .- 18.1 -
- ------------------------------------------------------------------------------------------------------------------------------
Lehman Aggregate Bond Index/+++/ - - .- -1.2 -
- ------------------------------------------------------------------------------------------------------------------------------
Lehman Municipal Bond Index/++++/ - - .- -0.6 -
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Total return is computed assuming the reinvestment of dividends and
capital gain distribution using net asset values.
Past performance is no guarantee of future results.
** Average performance of category of funds with similar investment
objectives as tracked by Lipper Analytical Services.
+ An unmanaged index of stocks reflecting average prices in the
stock market.
++ An unmanaged index of stocks of small capitalization companies
reflecting average prices in the stock market.
+++ An unmanaged index of bonds reflecting average prices in the bond market.
++++ An unmanaged index of bonds reflecting average prices in the municipal
bond market.
# Data for "B" shares for 2 month period since 4/1/96 inception.
<PAGE>
Sentinel Emerging Growth Fund
Investment in Securities
at May 31, 1996 (Unaudited)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------- -
Shares Value
(Note 1)
- --------------------------------------------------------------------
<S> <C> <C>
Common Stocks 83.6%
Auto Parts & Repair 2.3%
* Monro Muffler 21,100 $ 400,900
Pep Boys -
Manny, Moe & Jack 56,000 1,848,000
-----------
2,248,900
-----------
Communications 7.0%
* California Microwave 95,000 1,816,875
* Dynatech 83,000 2,894,625
* Verifone 43,800 2,206,425
-----------
6,917,925
-----------
Cosmetics & Toiletries 1.0%
* Bush Boake Allen 39,800 985,050
Electronics 7.8% -----------
* Amphenol Corp.-Class A 92,000 2,369,000
Harman Int'l. Industries 35,150 1,845,375
Methode Electronics 121,600 2,158,400
Stewart & Stevenson 52,000 1,300,000
-----------
7,672,775
-----------
Energy 6.9%
* California Energy 125,000 3,343,750
* Smith International 110,100 3,468,150
-----------
6,811,900
-----------
Environmental Control 6.1%
* U.S. Filter 45,050 1,571,119
* USA Waste Service 75,900 2,239,050
* Waste Management Int'l. plc 185,000 2,150,625
-----------
5,960,794
-----------
Financial 5.2%
Duff & Phelps Credit Rating 42,700 805,963
First Commerce 20,000 710,000
ROC Communities 89,300 2,132,037
Wilmington Trust Co. 44,900 1,481,700
-----------
5,129,700
-----------
Food & Food Distributors 6.2%
GoodMark Foods 87,800 1,295,050
Hannaford Brothers 47,000 1,486,375
Smart & Final 82,500 2,010,938
Tootsie Roll 35,837 1,263,254
-----------
6,055,617
-----------
Healthcare Providers 2.4%
* Advocat Inc. 30,800 315,700
* Genesis Health Ventures 64,950 2,054,044
-----------
2,369,744
-----------
Industrial & Commercial Services 5.7%
* Analysts Int'l. 25,000 1,075,000
* Healthcare Services Group 172,000 1,526,500
Kelly Services 52,100 1,549,975
Olsten Corp. 46,500 1,429,875
-----------
5,581,350
-----------
Industrial - Diversified 5.0%
Donaldson Co. 68,100 1,787,625
Lawter Int'l. 85,000 977,500
* Material Sciences 125,200 2,112,750
-----------
4,877,875
-----------
Insurance 2.2%
* American Travellers 99,750 2,157,094
-----------
Medical - Equipment & Supplies 10.4%
Allergan, Inc. 65,400 2,517,900
Hillenbrand Industries 39,000 1,462,500
Minntech 88,400 1,480,700
* Research Medical 75,000 1,903,125
* Respironics 46,000 908,500
* Scherer (R.P.) 45,600 1,915,200
------------
10,187,925
-----------
Metals 1.9%
J&L Specialty Steel 106,400 1,848,700
----------
Railroads 1.1%
Illinois Central Corp. 34,950 1,044,131
----------
Restaurants 2.0%
* IHOP Corp. 23,500 663,875
Sbarro, Inc. 47,900 1,275,337
----------
1,939,212
----------
Retail 2.9%
* Ethan Allen Interiors 45,000 1,181,250
Talbots Inc. 50,700 1,654,087
----------
2,835,337
----------
Security Services 2.5%
ADT Ltd. 129,500 2,492,875
----------
Software 3.7%
* FileNet Corp. 30,300 1,405,163
* Landmark Graphics 80,000 1,500,000
System Software Assoc. 42,200 691,025
----------
3,596,188
----------
Transportation 1.3%
Frozen Food Express 108,300 1,245,450
----------
Total Common Stocks
(Cost $65,188,063) 81,958,542
----------
Preferred Stock 0.3%
Phoenix Duff & Phelps Cl A
(Cost $403,571) 10,000 258,750
----------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------
<S> <C> <C>
Corporate Short-Term Notes 15.5%
Beneficial Corp. 5.25%,
06/13/96 3500M $ 3,493,874
Beneficial Corp. 5.27%,
06/18/96 1200M 1,197,014
Commercial Credit Corp. 5.27%,
06/21/96 2000M 1,994,144
Commercial Credit Corp. 5.28%,
06/26/96 2000M 1,992,667
IBM Credit Corp. 5.28%,
06/10/96 3000M 2,996,040
Norwest Financial, Inc. 5.29%,
06/05/96 3500M 3,497,943
------------
Total Corporate Short-Term Notes
(Cost $15,171,682) 15,171,682
------------
Total Investments
(Cost $80,763,316)** 97,388,974
Excess of Other Assets
Over Liabilities 0.6% 600,831
------------
Net Assets $ 97,989,805
============
</TABLE>
- --------------------------------------------------------------------
* Non-income producing.
** Also cost for federal income tax purposes.
At May 31, 1996, net unrealized appreciation
for federal income tax purposes aggregated
$16,625,658 of which $18,898,084 related to
appreciated securities and $2,272,426 related
to depreciated securities.
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Emerging Growth Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Assets
Investments at value $97,388,974
Cash and cash equivalents 549,430
Receivable for securities sold 421,400
Receivable for fund shares sold 30,249
Receivable for dividends and interest 43,459
-----------
Total Assets 98,433,512
-----------
Liabilities
Payable for securities purchased 225,283
Payable for fund shares repurchased 49,773
Accrued expenses 35,818
Management fee payable 52,084
Distribution fee payable (Class A Shares) 52,798
Distribution fee payable (Class B Shares) 308
Fund service fee payable 27,643
-----------
Total Liabilities 443,707
-----------
Net Assets Applicable to Outstanding Shares $97,989,805
===========
Net Asset Value and Offering Price per Share
Class A Shares
$97,461,857/19,340,190 shares outstanding $ 5.04
Sales Charge -- 5.00% of offering price 0.27
-----------
Maximum Offering Price $ 5.31
===========
Class B Shares
$527,948/105,089 shares outstanding $ 5.02
===========
Net Assets Represent
Capital stock at par value $ 194,453
Paid-in capital 79,743,867
Distributions in excess of net investment income (28,878)
Accumulated undistributed net realized gain
on investments 1,454,705
Unrealized appreciation of investments 16,625,658
-----------
Net Assets $97,989,805
===========
Investments at Cost $80,763,316
===========
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
Sentinel Emerging Growth Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Investment Income
Income:
Dividends $ 292,810
Interest 540,672
-----------
Total Income 833,482
-----------
Expenses:
Management advisory fee 292,430
Transfer agent and custodian 201,447
Distribution expense (Class A Shares) 136,380
Distribution expense (Class B Shares) 400
Accounting Services 19,316
Professional fees 8,725
Reports and notices to shareholders 15,349
Directors' fees and expenses 5,036
Other 9,402
-----------
Total Expenses 688,485
Expense Offset (16,369)
-----------
Net Expenses 672,116
-----------
Net Investment Income 161,366
-----------
Realized and Unrealized Gain on Investments
Net realized gain on sales of investments 1,454,669
Net change in unrealized appreciation 14,276,425
-----------
Net Realized and Unrealized Gain on Investments 15,731,094
-----------
Net Increase in Net Assets from Operations $15,892,460
===========
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Emerging Growth Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
------------- -------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 161,366 $ 247,950
Net realized gain on sales of investments 1,454,669 16,243,662
Net change in unrealized appreciation 14,276,425 (5,901,668)
------------ ------------
Net increase in net assets from operations 15,892,460 10,589,944
------------ ------------
Distributions to Shareholders
From net investment income
Class A Shares (438,193) -
Class B Shares - -
From realized gain on investments
Class A Shares (16,243,656) (14,411,597)
Class B Shares -
------------ ------------
Total distributions to shareholders (16,681,849) (14,411,597)
------------ ------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 6,734,253 13,979,568
Class B Shares 525,046 -
Net asset value of shares in reinvestment
of dividends and distributions
Class A Shares 15,171,070 13,135,828
Class B Shares - -
------------ ------------
22,430,369 27,115,396
Less: Payments for shares reacquired
Class A Shares (12,962,224) (22,392,181)
Class B Shares (10,121) -
Increase in net assets from capital share
transactions 9,458,024 4,723,215
----------- ------------
Total Increase in Net Assets for period 8,668,635 901,562
Net Assets: Beginning of period 89,321,170 88,419,608
----------- ------------
Net Assets: End of period $97,989,805 $ 89,321,170
=========== ============
Undistributed Net Investment Income (Loss)
at End of Period $ (28,878) $ 247,950
=========== =============
</TABLE>
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Growth Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Shares Value
(Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 97.1%
Automobiles & Auto Parts 4.0%
Ford Motor 18,000 $ 657,000
General Motors 25,000 1,378,125
Pep Boys -
Manny, Moe & Jack 19,100 630,300
------------
2,665,425
------------
Banks 3.3%
Banc One Corp. 18,000 666,000
BankAmerica Corp. 8,000 602,000
First Union Corp. 15,000 916,875
------------
2,184,875
------------
Beverages 1.1%
Pepsico Inc. 21,800 724,850
------------
Building Materials 2.0%
Sherwin-Williams 30,000 1,346,250
Chemicals 4.4%
Air Products & Chemicals 17,000 1,011,500
Grace (W. R.) 25,000 1,862,500
------------
2,874,000
------------
Computers 1.6%
Hewlett Packard 9,600 1,024,800
Consumer & Business Services 9.2%
First Data Corp. 30,000 2,392,500
General Motors Class E 30,000 1,691,250
Omnicom Group 30,000 1,308,750
Paychex, Inc. 15,750 693,000
------------
6,085,500
------------
Containers & Packaging 3.5%
Crown Cork & Seal 50,000 2,337,500
------------
Drugs 4.2%
Pfizer, Inc. 10,300 728,725
Pharmacia & Upjohn 21,000 858,375
Schering Plough 20,000 1,172,500
------------
2,759,600
------------
Electronics 9.7%
AMP Inc. 50,000 2,106,250
* Amphenol Corp.- Class A 30,000 772,500
* Applied Materials Inc. 24,000 894,000
Methode Electronics 25,000 443,750
Motorola 33,000 2,202,750
------------
6,419,250
------------
Energy 1.9%
Amoco 9,000 652,500
Enron Corp. 15,000 600,000
------------
1,252,500
------------
Environmental Control 2.3%
* U.S. Filter Corp. 33,000 1,150,875
* Waste Management Int'l. plc 30,000 348,750
------------
1,499,625
------------
Financial 1.1%
Student Loan Marketing A 10,000 743,750
------------
Food and Food Distributors 1.8%
CPC International 10,000 691,250
Sysco Corp. 15,000 511,875
------------
1,203,125
------------
Healthcare Providers 8.2%
Caremark International 60,000 1,642,500
Columbia/HCA Healthcare 21,000 1,131,375
* Healthcare Compare 10,000 483,750
Integrated Health Services 50,000 1,306,250
* Renal Treatment Centers 25,000 850,000
------------
5,413,875
------------
Industrial - Diversified 3.4%
Donaldson Co. 55,000 1,443,750
Fluor Corp. 12,500 815,625
------------
2,259,375
------------
Insurance 3.1%
Equitable of Iowa 55,000 2,028,125
------------
Medical-Equipment & Supplies 4.6%
Dentsply International 25,000 1,075,000
Johnson & Johnson 20,000 1,947,500
------------
3,022,500
------------
Oil Field Equipment 4.2%
Halliburton Co. 12,300 684,188
Schlumberger Ltd. 25,000 2,084,375
------------
2,768,563
------------
Railroad 1.7%
Union Pacific Corp. 16,000 1,122,000
------------
Retail 9.3%
Home Depot 25,000 1,278,125
Nordstrom, Inc. 25,000 1,275,000
Sears, Roebuck 25,000 1,271,875
TJX Companies 65,000 2,291,250
------------
6,116,250
------------
Semiconductors & Software 6.3%
Intel 23,100 1,744,050
* Microsoft 18,000 2,137,500
* Novell Inc. 22,000 313,500
------------
4,195,050
------------
Telecommunications 3.9%
* Airtouch Communications 35,000 1,115,625
* Worldcom Inc. 30,000 1,466,250
------------
2,581,875
------------
Tobacco 2.3%
Philip Morris 15,000 1,490,625
------------
Total Common Stocks
(Cost $53,765,928) 64,119,288
------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
Corporate Short-Term Notes 2.3%
Prudential Funding 5.29%
06/05/96
(Cost $1,499,118) 1500M $ 1,499,118
-----------
Total Investments
(Cost $55,265,046)** 65,618,406
Excess of Other Assets
Over Liabilities 0.6% 398,053
-----------
Net Assets $66,016,459
===========
</TABLE>
- --------------------------------------------------------------------------------
* Non-income producing.
** Also cost for federal income tax purposes. At
May 31, 1996, net unrealized appreciation for federal
income tax purposes aggregated $10,353,360 of
which $10,620,824 related to appreciated securities
and $267,464 related to depreciated securities.
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Growth Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Assets
Investments at value $65,618,406
Cash and cash equivalents 436,633
Receivable for dividends 101,577
-----------
Total Assets 66,156,616
-----------
Liabilities
Accrued expenses 62,140
Management fee payable 35,272
Distribution fee payable 26,298
Fund service fee payable 16,447
-----------
Total Liabilities 140,157
-----------
Net Assets Applicable to Outstanding Shares $66,016,459
===========
Net Asset Value and Offering Price per Share
$66,016,459 / 4,079,549 shares outstanding $ 16.18
Sales Charge -- 5.00% of Offering Price 0.85
-----------
Maximum Offering Price Per Share $ 17.03
===========
Net Assets Represent
Capital stock at par value $ 40,795
Paid-in capital 47,130,194
Accumulated undistributed net investment income 48,917
Accumulated undistributed net realized gain
on investments 8,443,193
Unrealized appreciation of investments 10,353,360
-----------
Net Assets $66,016,459
===========
Investments at Cost $55,265,046
===========
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
Sentinel Growth Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Investment Income
Income:
Dividends $ 512,948
Interest 69,514
----------
Total Income 582,462
----------
Expenses:
Management advisory fee 199,948
Transfer agent and custodian 127,648
Distribution expense 93,345
Accounting Services 13,285
Professional fees 7,050
Reports and notices to shareholders 6,756
Directors' fees and expenses 3,443
Other 16,573
---------
Total Expenses 468,048
---------
Expense Offset (10,938)
---------
Net Expenses 457,110
---------
Net Investment Income 125,352
---------
Realized and Unrealized Gain (Loss) on Investments
Net realized gain on sales of investments 8,443,213
Net change in unrealized appreciation (933,698)
----------
Net Realized and Unrealized Gain on Investments 7,509,515
----------
Net Increase in Net Assets from Operations $7,634,867
==========
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Growth Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
----------- -----------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 125,352 $ 228,927
Net realized gain on sales of investments 8,443,213 9,038,335
Net change in unrealized appreciation (933,698) 2,732,693
----------- -----------
Net increase in net assets from operations 7,634,867 11,999,955
----------- -----------
Distributions to Shareholders
From net investment income (258,814) (139,887)
From net realized gain on investments (9,038,321) (7,982,066)
----------- ----------
Total distributions to shareholders (9,297,135) (8,121,953)
----------- ----------
From Capital Share Transactions
Net proceeds from sales of shares 4,215,902 5,940,101
Net asset value of shares in reinvestment
of dividends and distributions 8,450,217 7,247,471
----------- ----------
12,666,119 13,187,572
Less: Payments for shares reacquired (5,433,761) (7,065,780)
----------- ----------
Increase in net assets from capital share
transactions 7,232,358 6,121,792
----------- ----------
Total Increase in Net Assets for period 5,570,090 9,999,794
Net Assets: Beginning of period 60,446,369 50,446,575
----------- ----------
Net Assets: End of period $66,016,459 $60,446,369
=========== ===========
Undistributed Net Investment Income
at End of Period $ 48,917 $ 182,378
=========== ===========
</TABLE>
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel World Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Shares Value
(Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 92.2%
Argentina 1.0%
YPF S. A. (ADR) 30,000 $ 660,000
------------
Austria 1.0%
EVN Energie Versorgung Niedr 4,320 628,261
------------
Australia 4.2%
CRA Ltd. 49,625 804,543
National Australia 126,880 1,190,063
Qantas Airways 165,000 295,033
Westpac Bank Corp Ord. 96,008 448,334
------------
2,737,973
------------
Denmark 1.1%
Tele Danmark (ADR) 30,000 746,250
------------
Finland 2.5%
Cultor 15,400 730,829
Nokia Corp. (ADR) 20,000 870,000
------------
1,600,829
------------
France 5.3%
Alcatel Alsthom (ADR) 40,005 735,092
CSF Thomson 19,200 502,941
Elf Aquitaine (ADR) 23,785 871,126
Guyenne et Gascogne 1,940 678,954
Soceite Generale 6,200 661,173
------------
3,449,286
------------
Germany 4.7%
Bayer A.G. Ord. 1,900 638,177
BMW 1,300 718,075
Siemens A.G. 13,000 730,619
Veba A.G. 19,000 996,987
------------
3,083,858
------------
Hong Kong 3.8%
China Light & Power Co. 165,000 784,831
HSBC Holdings 40,363 610,399
Jardine Matheson 141,232 1,087,486
------------
2,482,716
------------
Italy 1.0%
Istituto Mobiliare
Italia (ADR) 27,500 684,063
------------
Japan 27.0%
Canon 40,000 784,822
Dai Nippon Printing Co 55,000 1,018,047
Dai Tokyo Fire & Marine 110,000 799,167
Daiichi Corp. 37,000 962,240
Daiichi Pharmaceuticals 45,000 695,511
Fuji Photo Film 25,000 777,418
Hitachi Koki Co. Ord. 80,000 792,226
Ito-Yokado 14,000 794,262
Kirin Beverage 50,000 745,025
Kyocera Corp. 14,000 958,815
Kyushu Electric Power 27,200 654,512
Mitsubishi Heavy Industry 120,000 1,031,745
Murata Manufacturing 25,000 916,242
Nishimatsu Construction 62,000 659,880
Nomura Securities 40,000 755,206
Sankyo Co LTD 40,000 947,709
Sekisui House 65,000 763,998
TDK Corp. 16,000 910,689
Teijin 180,000 931,236
Toshiba Corp. 115,000 799,306
Toyota Motors Corp. Ord. 42,000 960,111
------------
17,658,167
------------
Malaysia 0.3%
Malaysian Int'l. Shipping 60,000 185,081
------------
Mexico 1.0%
Telefonos de Mexico (ADR) 20,000 660,000
------------
Netherlands 8.8%
ABN Amro Bank 20,827 1,150,811
Akzo Nobel N.V. 6,000 727,475
Heineken Holdings 3,125 636,988
Hollandsche Benton
Groep N.V. 3,900 729,306
ING Groep N.V. 10,916 900,275
Norsk Hydro (ADR) 18,000 843,750
Royal PTT - KPN 20,872 756,622
------------
5,745,227
------------
Singapore 2.0%
Malaysian Int'l. Shipping 126,666 386,972
Sime Darby Berhad 144,000 384,682
Singapore Int'l. Airlines 55,000 566,607
------------
1,338,261
South Korea 0.7% ------------
Po Hang Iron & Steel Co. 6,740 463,618
------------
Spain 5.7%
Banco Popular 4,000 700,195
Banco Santander 18,000 823,860
Iberdrola 35,000 356,140
Repsol (ADR) 35,000 1,190,000
Telefonica de
Espana S.A. (ADR) 12,000 628,500
------------
3,698,695
------------
Sweden 3.8%
Aga B Free 40,000 684,789
Astra AB B Free 20,000 903,623
Swedish Match AB 37,500 125,048
Volvo AB B 37,500 795,509
------------
2,508,969
------------
Switzerland 4.8%
Ciba Geigy Registered 725 799,268
Globus PC 900 540,411
Nestle A.G. Registered 675 761,979
Sandoz Registered 575 597,534
Zurich Insurance P.T.G. 1,600 422,721
------------
3,121,913
------------
United Kingdom 13.5%
Albright & Wilson 200,000 570,584
Allied Irish Bank 192,815 1,040,379
Boots Co. plc 60,000 566,553
Glaxo Hldg plc (ADR) 32,500 849,063
Guinness plc 90,000 649,582
Hanson plc (ADR) 35,000 511,875
Johnson Matthey plc 65,000 668,188
National Westminster
Bank plc 76,342 738,026
Severn Trent Water plc 93,669 877,212
Tesco plc 247,847 1,158,625
Unilever N V (ADR) 9,000 1,213,875
------------
8,843,962
------------
Total Common Stocks
(Cost $51,767,360) 60,297,129
------------
Preferred Stock 1.0%
Germany 1.0%
RWE A.G.
(Cost $432,246) 20,660 $ 640,094
------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
Corporate Short-Term Notes 4.6%
Beneficial Corp. 5.26%,
06/07/96 1500M 1,498,685
Norwest Financial, Inc. 5.16%,
06/04/96 1500M 1,499,355
------------
Total Corporate Short Term Notes
(Cost $2,998,040) 2,998,040
------------
Total Investments
(Cost $55,197,646)* 63,935,263
Excess of Other Assets
Over Liabilities 2.2% 1,439,990
------------
Net Assets $ 65,375,253
============
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Summary of Foreign Securities
by Industry Classification
<S> <C> <C>
Percent of Market
Industry Net Assets Value
Aerospace 0.8% $ 502,941
Automobiles 3.8% 2,473,695
Banks 12.3% 8,047,303
Beverages 3.1% 2,031,595
Chemicals 5.3% 3,464,775
Construction & Housing 4.5% 2,945,410
Cosmetics & Toiletries 1.8% 1,213,875
Drugs 7.3% 4,792,708
Electrical Equipment 2.5% 1,646,861
Electronics 6.4% 4,188,724
Energy 4.2% 2,721,126
Foods 2.3% 1,492,808
Industrial Diversified 3.0% 1,984,043
Insurance 3.2% 2,122,163
Investment Companies 1.2% 755,206
Machinery 1.6% 1,031,745
Metals & Mining 3.0% 1,936,349
Photography 1.2% 777,418
Publishing 1.6% 1,018,047
Retail 7.2% 4,701,045
Telecommunications 2.5% 1,626,622
Textiles 1.4% 931,236
Tobacco 0.2% 125,048
Transportation 2.2% 1,433,693
Utilities - Electric 6.2% 4,060,825
Utilities - Telephone 3.1% 2,034,750
Utilities - Water 1.3% 877,212
-------- ------------
93.2% $ 60,937,223
======== ============
</TABLE>
- --------------------------------------------------------------------------------
* Also cost for federal income tax purposes. At
May 31, 1996, net unrealized appreciation for federal
income tax purposes aggregated $8,737,617 of which
$9,722,383 related to appreciated securities and
$984,766 related to depreciated securities.
(ADR) - American Depositary Receipt
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel World Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Assets
Investments at value $63,935,263
Cash and cash equivalents 1,531,948
Foreign currency (cost $411,802) 416,886
Receivable for securities sold 280,734
Receivable for fund shares sold 14,316
Receivable for dividends and interest 350,170
-----------
Total Assets 66,529,317
-----------
Liabilities
Payable for securities purchased 1,046,677
Accrued expenses 32,636
Management fee payable 34,212
Distribution fee payable (Class A Shares) 28,905
Distribution fee payable (Class B Shares) 306
Fund service fee payable 11,328
-----------
Total Liabilities 1,154,064
-----------
Net Assets Applicable to Outstanding Shares $65,375,253
===========
Net Asset Value and Offering Price per Share
Class A Shares
$64,651,846/4,334,469 shares outstanding $ 14.92
Sales Charge -- 5.00% of offering price 0.79
-----------
Maximum Offering Price $ 15.71
===========
Class B Shares
$723,407/48,578 shares outstanding $ 14.89
===========
Net Assets Represent
Capital stock at par value $ 43,830
Paid-in capital 55,774,177
Accumulated undistributed net investment income 344,501
Accumulated undistributed net realized gain
on investments 475,790
Unrealized appreciation of investments 8,736,955
-----------
Net Assets $65,375,253
===========
Investments at Cost $55,197,646
===========
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
Sentinel World Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Investment Income
Income:
Dividends $ 751,403 *
Interest 79,926
----------
Total Income 831,329
----------
Expenses:
Management advisory fee 179,816
Transfer agent and custodian 123,503
Distribution expense (Class A Shares) 83,880
Distribution expense (Class B Shares) 370
Accounting Services 10,000
Professional fees 9,375
Reports and notices to shareholders 6,298
Directors' fees and expenses 3,147
Other 17,319
----------
Total Expenses 433,708
Expense Offset (15,401)
----------
Net Expenses 418,307
==========
Net Investment Income 413,022
</TABLE>
<TABLE>
<CAPTION>
Realized and Unrealized Gain (Loss) on Investments
Net realized gain (loss) from:
<S> <C>
Investments 507,565
Foreign currency transactions (72,796)
-----------
Net realized gain 434,769
-----------
Net change in unrealized appreciation during the
period:
Investments 4,243,840
Foreign currency transactions 20,909
-----------
Net change in unrealized appreciation 4,264,749
-----------
Net Realized and Unrealized Gain on Investments 4,699,518
-----------
Net Increase in Net Assets from Operations $5,112,540
===========
</TABLE>
* Net of Foreign Tax Withholding of $89,575
See Notes to Financial Statements.
<PAGE>
Sentinel World Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
-------------- --------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 413,022 $ 349,068
Net realized gain on sales of investments 434,769 355,098
Net change in unrealized appreciation 4,264,749 3,563,174
----------- ------------
Net increase in net assets from operations 5,112,540 4,267,340
----------- ------------
Distributions to Shareholders
From net investment income
Class A Shares (471,463) (286,485)
Class B Shares - -
From realized gain on investments
Class A Shares (228,430) (505,083)
Class B Shares - -
----------- ------------
Total distributions to shareholders (699,893) (791,568)
----------- -------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 17,180,943 15,888,398
Class B Shares 714,760 -
Net asset value of shares in reinvestment
of dividends and distributions
Class A Shares 660,554 761,890
Class B Shares - -
----------- ------------
18,556,257 16,650,288
Less: Payments for shares reacquired
Class A Shares (5,295,639) (14,394,477)
Class B Shares - -
Increase in net assets from capital share
transactions 13,260,618 2,255,811
----------- ------------
Total Increase in Net Assets for period 17,673,265 5,731,583
Net Assets: Beginning of period 47,701,988 41,970,405
----------- ------------
Net Assets: End of period $65,375,253 $ 47,701,988
=========== ============
Undistributed Net Investment Income
at End of Period $ 344,501 $ 475,738
=========== ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Common Stock Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- ------------------------------------------- ------------------------------------------------
Shares Value Shares Value
(Note 1) (Note 1)
- ------------------------------------------- ------------------------------------------------
<S> <C> <C> <C> <C> <C>
Common Stocks 93.1%
Automobiles & Auto Parts 3.0% Industrial--Diversified 3.7%
Parker-Hannifin 275,000 $ 11,206,250
Echlin Inc. 550,000 $ 18,906,250 Rockwell Int'l. 310,600 18,131,275
Ford Motor 440,000 16,060,000 Tenneco 270,000 14,512,500
----------- -----------
34,966,250 43,850,025
----------- -----------
Banks 10.2% Insurance 4.1%
Banc One Corp. 351,967 13,022,779 Allstate Corp. 485,003 20,491,377
Bank of New York 225,000 11,671,875 American General 380,000 13,490,000
BankAmerica Corp. 200,000 15,050,000 American Int'l. Group 142,575 13,437,694
Chase Manhattan Corp. 287,200 20,104,000 -----------
Citicorp 287,900 24,183,600 47,419,071
First Union Corp. 220,000 13,447,500 -----------
Morgan (J. P.) 254,700 22,127,062 Medical--Equipment & Supplies 2.1%
----------- Johnson & Johnson 250,000 24,343,750
119,606,816 -----------
----------- Oil Field Equipment & Services 2.8%
Beverages 2.3% Halliburton Co. 229,800 12,782,625
Coca-Cola 580,000 26,680,000 Schlumberger Ltd. 240,000 20,010,000
Building Materials 1.5% ----------- -----------
Sherwin-Williams 400,000 17,950,000 32,792,625
Chemicals 3.3% ----------- -----------
Grace (W. R.) 295,000 21,977,500 Paper & Forest Products 1.9%
PPG Industries 325,000 16,818,750 Kimberly-Clark 300,000 21,862,500
----------- -----------
38,796,250 Publishing 2.2%
Consumer & Business Services 3.1% ----------- Gannett 162,000 11,299,500
General Motors Class E 298,986 16,855,336 McGraw-Hill 300,000 14,062,500
Omnicom Group 450,000 19,631,250 -----------
----------- 25,362,000
36,486,586 -----------
Containers, Packaging 1.6% ----------- Railroads 1.8%
Crown Cork & Seal 400,000 18,700,000 Union Pacific Corp. 300,000 21,037,500
----------- -----------
Cosmetics & Toiletries 2.1% Retail 4.9%
Gillette 417,144 24,663,639 May Department Stores 366,980 17,385,677
----------- Nordstrom, Inc. 250,000 12,750,000
Drugs 3.9% * Payless Shoesource, Inc. 58,716 1,651,387
American Home Products 450,000 24,075,000 Sears, Roebuck 503,500 25,615,563
Pfizer, Inc. 300,000 21,225,000 -----------
----------- 57,402,627
45,300,000 -----------
Electrical Equipment 5.6% ----------- Telecommunications 3.2%
Emerson Electric 350,000 29,968,750 A T & T Corp. 440,000 27,445,000
General Electric 425,000 35,168,750 * US West Media Group 500,790 9,452,411
----------- -----------
65,137,500 36,897,411
Electronics 1.2% ----------- -----------
AMP Inc. 320,000 13,480,000 Tobacco 3.6%
----------- American Brands 399,600 17,482,500
Energy 10.7% Philip Morris 250,000 24,843,750
Amoco 259,600 18,821,000 -----------
Atlantic Richfield 98,800 11,818,950 42,326,250
Chevron 240,000 14,340,000 -----------
Exxon 315,400 26,730,150 Utilities--Electric 2.3%
Mobil 210,000 23,703,750 FPL Group 360,000 15,390,000
Royal Dutch Petroleum 197,218 29,582,700 Florida Progress 350,000 11,550,000
----------- -----------
124,996,550 26,940,000
Financial 1.6% ----------- -----------
American Express 411,700 18,835,275 Utilities--Gas 2.8%
----------- Enron Corp. 420,000 16,800,000
Foods 3.3% Sonat, Inc. 380,000 16,102,500
CPC International 225,000 15,553,125 -----------
Sara Lee 700,000 23,362,500 32,902,500
----------- -----------
38,915,625 Utilities--Telephone 2.1%
----------- GTE Corp. 280,000 11,970,000
Healthcare Providers 2.2% US West Comm. Group 370,790 12,097,024
Columbia/HCA Healthcare 475,000 25,590,625 -----------
----------- 24,067,024
-----------
Total Common Stocks
(Cost $552,602,605) 1,087,308,399
-------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------
<S> <C> <C>
Corporate Short-Term Notes 6.5%
Beneficial Corp.
5.29%, 06/05/96 2,700M $ 2,698,413
Beneficial Corp.
5.26%, 07/12/96 4,500M 4,473,043
Beneficial Corp.
5.29%, 07/17/96 8,500M 8,442,545
CIT Group Holdings
5.28%, 07/09/96 8,000M 7,955,413
G.E. Capital Corp.
5.27%, 06/07/96 10,000M 9,991,217
IBM Credit Corp.
5.27%, 06/28/96 11,000M 10,956,523
John Deere Capital Corp.
5.28%, 06/05/96 3,850M 3,847,741
John Deere Capital Corp.
5.25%, 06/12/96 3,500M 3,494,385
National City Credit Corp.
5.29%, 06/25/96 4,000M 3,985,893
National City Credit Corp.
5.28%, 07/03/96 3,000M 2,985,920
Norwest Financial, Inc.
5.28%, 06/17/96 5,000M 4,988,267
Norwest Financial, Inc.
5.26%, 06/20/96 6,900M 6,880,845
Prudential Funding
5.27%, 07/12/96 5,500M 5,466,989
-------------
Total Corporate Short-Term Notes
(Cost $76,167,194) 76,167,194
-------------
Total Investments
(Cost $628,769,799)** 1,163,475,593
Excess of Other Assets
Over Liabilities 0.4% 4,122,394
--------------
Net Assets $1,167,597,987
==============
</TABLE>
- ------------------------------------------------
* Non-income producing.
** The aggregate cost for federal income tax purposes was $628,943,248. At
May 31, 1996, unrealized appreciation for income tax purposes aggregated
$534,532,345 of which $538,955,860 related to appreciated securities and
$4,423,515 related to depreciated securities.
<PAGE>
<TABLE>
<CAPTION>
=============================================================== ===============================================================
Sentinel Common Stock Fund Sentinel Common Stock Fund
Statement of Assets and Liabilities Statement of Operations
at May 31, 1996 (Unaudited) For the Six Months Ended May 31, 1996 (Unaudited)
- --------------------------------------------------------------- ---------------------------------------------------------------
<S> <C> <S> <C>
Assets Investment Income
Investments at value $1,163,475,593
Cash and cash equivalents 882,813 Income:
Receivable for fund shares sold 307,476 Dividends $ 14,184,295
Receivable for dividends and interest 4,513,590 Interest 1,743,226
-------------- ------------
Total Assets 1,169,179,472 Total Income 15,927,521
-------------- ------------
Liabilities Expenses:
Payable for fund shares repurchased 57,341 Management advisory fee 3,061,141
Accrued expenses 390,099 Transfer agent and custodian 898,164
Management fee payable 537,094 Distribution expense (Class A Shares) 1,615,000
Distribution fee payable (Class A Shares) 455,379 Distribution expense (Class B Shares) 4,995
Distribution fee payable (Class B Shares) 3,731 Accounting Services 237,133
Fund service fee payable 137,841 Professional fees 111,850
-------------- Reports and notices to shareholders 39,607
Total Liabilities 1,581,485 Directors' fees and expenses 61,289
-------------- Other 31,607
Net Assets Applicable to Outstanding shares $1,167,597,987 ------------
============== Total Expenses 6,060,786
Expense Offset (59,672)
Net Asset Value and Offering Price per Share ------------
Class A Shares Net Expenses 6,001,114
$1,161,477,572 / 32,332,420 shares outstanding $ 35.92 ------------
Sales Charge -- 5.00% of offering price 1.89 Net Investment Income 9,926,407
-------------- ------------
Maximum Offering Price $ 37.81 Realized and Unrealized Gain on Investments
============== Net realized gain on sales of investments 61,875,930
Class B Shares Net change in unrealized appreciation 49,401,247
$6,120,415 / 170,567 shares outstanding $ 35.88 ------------
============== Net Realized and Unrealized Gain on Investments 111,277,177
Net Assets Represent ------------
Net Increase in Net Assets from Operations $121,203,584
Capital stock at par value $ 325,030 ============
Paid-in capital 567,452,849
Accumulated undistributed net investment income 3,413,906
Accumulated undistributed net realized gain
on investments 61,700,408
Unrealized appreciation of investments 534,705,794
--------------
Net Assets $1,167,597,987
==============
Investments at Cost $ 628,769,799
==============
See Notes to Financial Statements. See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Sentinel Common Stock Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
-------------- ------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 9,926,407 $ 21,822,839
Net realized gain on sales of
investments 61,875,930 83,681,019
Net change in unrealized appreciation 49,401,247 164,928,158
-------------- --------------
Net increase in net assets from
operations 121,203,584 270,432,016
-------------- --------------
Distributions to Shareholders
From net investment income
Class A Shares (9,849,844) (22,427,518)
Class B Shares - -
From net realized gain on investments
Class A Shares (82,958,132) (32,779,992)
Class B Shares - -
-------------- --------------
Total distributions to shareholders (92,807,976) (55,207,510)
-------------- --------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 58,068,230 70,030,323
Class B Shares 6,024,176 -
Net asset value of shares in
reinvestment of dividends and
distributions
Class A Shares 76,394,777 43,543,555
Class B Shares - -
Net asset value of shares in exchange
for net assets of another
investment company - 51,894,735
-------------- --------------
140,487,183 165,468,613
Less: Payments for shares reacquired
Class A Shares (59,225,447) (162,084,590)
Class B Shares (3,150) -
-------------- --------------
Increase in net assets from capital
share transactions 81,258,586 3,384,023
-------------- --------------
Total Increase in Net Assets for period 109,654,194 218,608,529
Net Assets: Beginning of period 1,057,943,793 839,335,264
-------------- --------------
Net Assets: End of period $1,167,597,987 $1,057,943,793
============== ==============
Undistributed Net Investment Income
at End of Period $ 3,413,906 $ 3,337,344
============== ==============
</TABLE>
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Balanced Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- ------------------------------------------------ ---------------------------------------------------
Principal Amount Value Principal Amount Value
(M=$1,000) (Note 1) (M=$1,000) (Note 1)
- ------------------------------------------------ ---------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Government Obligations 16.3% Bonds 16.3%
U.S. Treasury Obligations 12.2% Beverages 0.3%
2-Year: Anheuser Busch 8.5%, '17 771M $ 802,804
Note 6%, '97 7300M $ 7,299,051 -----------
----------- Financial Institutions 3.8%
5-Year: Bankers Trust 7.125%, '06 1600M 1,542,000
Note 5.5%, '00 1050M 1,003,727 First Bank of Puerto Rico
----------- 7.625%, '05 1500M 1,438,125
10-Year: First Union Corp. 6.18%, '36 2325M 2,141,906
Note 6.375%, '02 5000M 4,915,500 Lehman Brothers Holdings
Note 7.5%, '05 5250M 5,466,562 8.8%, '15 1200M 1,308,000
Note 5.625%, '06 15000M 13,761,150 Midland Bank 7.65%, '25 800M 816,000
----------- Salomon Bros. 6.75%, '03 1000M 951,250
24,143,212 Salomon Bros. 6.875%, '03 2500M 2,356,250
----------- ----------
30-Year: 10,553,531
Bond 7.2%, '16 2000M 2,018,820 ----------
----------- Foreign Financial Institutions 2.5%
Total U.S. Treasury Obligations 34,464,810 Banque Paribas (Fr.)
----------- 6.875%, '09 2000M 1,812,500
U.S. Government Agency Obligations 4.1% Santander Financial (Spa.)
Federal Home Loan Mortgage Corp. 0.1% 7%, '06 2000M 1,925,000
5-Year: Swedish Export Credit
6.835%, '99 395M 394,709 9.875%, '38 3000M 3,285,000
----------- ----------
Federal National Mortgage Association 3.9% 7,022,500
Collateralized Mortgage Obligation: ----------
148(B), 0%, '98 1862M 1,774,855 Industrial - Diversified 1.5%
----------- TCI Communications 8%, '05 2750M 2,667,500
Medium Term Note: Tosco Corp 9.625%, '02 1300M 1,428,375
6.29%, '00 4000M 3,925,440 ----------
Principal Strips: 4,095,875
0%, '01 3270M 3,195,346 ----------
0%, '01 2365M 2,299,087 Insurance 4.7%
----------- Continental Corp. 7.25%, '03 1000M 990,000
5,494,433 Farmers Insurance Exchange
----------- 8.5%, '04 2000M 2,007,500
Total Federal National Integon Corp. 8%, '99 750M 749,062
Mortgage Association 11,194,728 Integon Corp. 9.5%, '01 1500M 1,575,000
----------- Liberty Mutual 8.2%, '07 2000M 2,065,000
Government National Mortgage Association 0.1% Pacific Mutual 7.9%, '23 2250M 2,199,375
30-Year: Prudential Insurance
9%, '09 45M 46,744 7.65%, '07 3500M 3,447,500
Total U.S. Government ----------- ----------
Agency Obligations 11,636,181 13,033,437
----------- ----------
Total U.S. Government Obligations Retail 0.7%
(Cost $47,672,082) 46,100,991 May Dept. Store 9.125%, '16 2000M 2,100,000
----------- ----------
Telecommunications 0.7%
Comsat 8.05%, '06 2000M 2,140,800
----------
Utility-Electric 1.4%
Gulf State Utilities 8.94%, '22 2000M 1,950,000
Mississippi Power & Light
8.8%, '05 2000M 2,047,500
----------
3,997,500
----------
Utility-Gas 0.7%
Consolidated Natural Gas
8.25%, '11 2000M 2,100,000
----------
Total Bonds
(Cost $46,503,174) 45,846,447
----------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------
Shares Value
(Note 1)
- ---------------------------------------------------------
<S> <C> <C>
Common Stocks 56.3%
Automobiles & Auto Parts 2.0%
Echlin Inc. 80,000 $2,750,000
Ford Motor 76,000 2,774,000
-----------
5,524,000
-----------
Banks 4.7%
Banc One Corp. 66,027 2,443,000
Bank of New York 30,000 1,556,250
BankAmerica Corp. 25,000 1,881,250
Chase Manhattan Corp. 26,000 1,820,000
Citicorp 25,000 2,100,000
First Union Corp. 30,000 1,833,750
Morgan (J. P.) 20,000 1,737,500
-----------
13,371,750
-----------
Beverages 1.0%
Coca-Cola 62,400 2,870,400
-----------
Building Materials 1.0%
Sherwin-Williams 60,000 2,692,500
-----------
Chemicals 1.8%
Grace (W.R.) 32,000 2,384,000
PPG Industries 50,000 2,587,500
-----------
4,971,500
-----------
Consumer & Business Services 2.3%
General Motors Class E 56,312 3,174,589
Omnicom Group 75,000 3,271,875
-----------
6,446,464
-----------
Containers, Packaging 0.9%
Crown Cork & Seal 55,000 2,571,250
Drugs 2.3%
American Home Products 60,000 3,210,000
Pfizer, Inc. 45,000 3,183,750
-----------
6,393,750
------------
Electrical Equipment 3.5%
Emerson Electric 37,500 3,210,937
General Electric 47,500 3,930,625
Grainger, (W.W.) 40,000 2,675,000
-----------
9,816,562
-----------
Electronics 0.7%
AMP Inc. 48,600 2,047,275
-----------
Energy 6.2%
Amoco 44,000 3,190,000
Atlantic Richfield 17,000 2,033,625
Chevron 35,000 2,091,250
Exxon 38,000 3,220,500
Mobil 30,050 3,391,894
Royal Dutch Petroleum 24,000 3,600,000
-----------
17,527,269
-----------
Financial 1.0%
American Express 60,000 2,745,000
-----------
Foods 2.2%
CPC International 45,000 3,110,625
Sara Lee 95,000 3,170,625
-----------
6,281,250
-----------
</TABLE>
(CONTINUED)
<PAGE>
<TABLE>
<CAPTION>
Sentinel Balanced Fund
Investment in Securities (cont'd.)
at May 31, 1996 (Unaudited)
- ----------------------------------------------------------- ---------------------------------------------------
Shares Value Principal Amount Value
(Note 1) (M=$1,000) (Note 1)
- ----------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C> <C> <C>
Healthcare Providers 1.2% Corporate Short-Term Notes 14.7%
Columbia/HCA Healthcare 65,000 $ 3,501,875 Beneficial Corp. 5.27%,
----------- 06/21/96 6500M $ 6,480,969
Industrial-Diversified 2.8% Beneficial Corp. 5.27%,
Dover 30,000 1,425,000 06/26/96 5500M 5,479,872
Parker-Hannifin 35,000 1,426,250 Commercial Credit 5.29%,
Rockwell Int'l. 50,000 2,918,750 06/10/96 1250M 1,248,347
Tenneco 40,179 2,159,621 Commercial Credit 5.28%,
----------- 06/18/96 7000M 6,982,547
7,929,621 IBM Credit Corp. 5.29%,
----------- 06/13/96 3500M 3,493,828
Insurance 3.4% National City Credit Corp. 5.29%,
Allstate Corp. 85,000 3,591,250 06/05/96 2400M 2,398,589
American General 55,000 1,952,500 National City Credit Corp. 5.28%,
American Int'l. Group 25,375 2,391,594 06/18/96 7000M 6,982,547
Equitable of Iowa 45,000 1,659,375 Norwest Financial, Inc. 5.27%,
----------- 06/18/96 5500M 5,486,313
9,594,719 Norwest Financial, Inc. 5.30%,
----------- 07/01/96 2800M 2,787,633
Medical-Equipment & Supplies 1.2% --------------
Johnson & Johnson 36,000 3,505,500 Total Corporate Short-Term Notes
----------- (Cost $41,340,645) 41,340,645
Oil Field Equipment & Services 1.9% --------------
Halliburton Co. 37,000 2,058,125 Total Investments
Schlumberger Ltd. 38,000 3,168,250 (Cost $235,980,954)** 292,014,681
-----------
5,226,375 Excess of Liabilities
----------- Over Other Assets (3.6%) (10,243,116)
Paper & Forest Products 0.9% --------------
Kimberly-Clark 35,000 2,550,625
----------- Net Assets $281,771,565
Publishing 1.7% ==============
Gannett 27,000 1,883,250 ---------------------------------------------------
McGraw-Hill 60,000 2,812,500 * Non-income producing.
-----------
4,695,750 ** Also cost for federal income tax purposes. At
-----------
Railroads 1.9% May 31, 1996, net unrealized appreciation for
Illinois Central Corp. 82,500 2,464,688 federal income tax purposes aggregated
Union Pacific Corp. 40,000 2,805,000 $56,033,727 of which $59,120,812 related to
----------- to appreciated securities and $3,087,085 related
5,269,688 to depreciated securities.
-----------
Recreation 0.6%
Coleman 40,000 1,735,000
-----------
Retail 3.4%
May Department Stores 55,000 2,605,625
Nordstrom, Inc. 40,000 2,040,000
*Payless Shoesource, Inc. 8,800 247,500
Sears, Roebuck 90,000 4,578,750
-----------
9,471,875
-----------
Telecommunications 1.8%
A T & T Corp. 60,000 3,742,500
*US West Media Group 70,150 1,324,081
-----------
5,066,581
-----------
Tobacco 1.7%
American Brands 45,000 1,968,750
Philip Morris 28,000 2,782,500
-----------
4,751,250
-----------
Utilities-Electric 0.9%
FPL Group 60,000 2,565,000
-----------
Utilities-Gas 1.7%
Enron Corp. 60,000 2,400,000
Sonat, Inc. 60,000 2,542,500
-----------
4,942,500
-----------
Utilities-Telephone 1.6%
GTE Corp. 70,000 2,992,500
US West Comm. Group 51,150 1,668,769
-----------
4,661,269
-----------
Total Common Stocks
(Cost $100,465,053) 158,726,598
-----------
See Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
====================================================================================================================================
Sentinel Balanced Fund Sentinel Balanced Fund
Statement of Assets and Liabilities Statement of Operations
at May 31, 1996 (Unaudited) For the Six Months Ended May 31, 1996 (Unaudited)
- ------------------------------------------------------------ -------------------------------------------------------------------
<S> <C> <C> <C>
Assets Investment Income
Investments at value $292,014,681 Income:
Cash and cash equivalents 511,584 Dividends $ 2,037,353
Receivable for securities sold 1,100,000 Interest 4,110,963
Receivable for fund shares sold 16,013 -------------
Receivable for dividends and interest 2,527,351 Total Income 6,148,316
-------------- -------------
Total Assets 296,169,629 Expenses:
-------------- Management advisory fee 888,756
Liabilities Transfer agent and custodian 285,785
Payable for securities purchased 13,939,966 Distribution expense (Class A Shares) 414,500
Payable for fund shares repurchased 10,566 Distribution expense (Class B Shares) 1,510
Accrued expenses 131,162 Accounting Services 58,746
Management fee payable 152,035 Professional fees 35,010
Distribution fee payable (Class A Shares) 123,379 Reports and notices to shareholders 17,603
Distribution fee payable (Class B Shares) 1,167 Directors' fees and expenses 15,155
Fund service fee payable 39,789 Other 29,238
-------------- -------------
Total Liabilities 14,398,064 Total Expenses 1,746,303
-------------- Expense Offset (25,056)
Net Assets applicable to outstanding shares $281,771,565 -------------
============== Net Expenses 1,721,247
Net Asset Value and Offering Price per Share -------------
Class A Shares Net Investment Income 4,427,069
$279,972,325/16,329,615 shares outstanding $ 17.15 -------------
Sales Charge -- 5.00% of offering price 0.90
-------------- Realized and Unrealized Gain on Investments
Maximum Offering Price $ 18.05 Net realized gain on sales of investments 5,274,271
============== Net change in unrealized appreciation 6,530,431
Class B Shares -------------
$1,799,240/105,114 shares outstanding $ 17.12 Net Realized and Unrealized Gain on Investments 11,804,702
============== -------------
Net Increase in Net Assets from Operations $16,231,771
Net Assets Represent =============
Capital stock at par value $ 164,347
Paid-in capital 219,120,783
Accumulated undistributed net investment income 1,305,323
Accumulated undistributed net realized gain
on investments 5,147,385
Unrealized appreciation of investments 56,033,727
--------------
Net Assets $281,771,565
==============
Investments at Cost $235,980,954
==============
See Notes to Financial Statements. See Notes to Financial Statements.
</TABLE>
<PAGE>
Sentinel Balanced Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
------------- ------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 4,427,069 $ 9,309,981
Net realized gain on sales of investments 5,274,271 6,896,018
Net change in unrealized appreciation 6,530,431 37,588,953
Net increase in net assets from operations 16,231,771 53,794,952
------------- -------------
Distributions to Shareholders
From net investment income
Class A Shares (4,342,501) (9,440,483)
Class B Shares - -
From net realized gain on investments
Class A Shares (6,598,524) (143,043)
Class B Shares - -
------------- -------------
Total distributions to shareholders (10,941,025) (9,583,526)
------------- -------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 24,005,090 35,919,601
Class B Shares 1,802,633 -
Net asset value of shares in reinvestment
of dividends and distributions -
Class A Shares 10,158,274 8,552,193
Class B Shares - -
Net asset value of shares in exchange for
net assets of another investment company - 4,084,150
------------- -------------
35,965,997 48,555,944
Less: Payments for shares reacquired
Class A Shares (26,574,387) (51,993,073)
Class B Shares (13,542) -
Increase (decrease) in net assets from
capital share transactions 9,378,068 (3,437,129)
------------- -------------
Total Increase in Net Assets for period 14,668,814 40,774,297
Net Assets: Beginning of period 267,102,751 226,328,454
------------- -------------
Net Assets: End of period $281,771,565 $267,102,751
============= =============
Undistributed Net Investment Income
at End of Period $ 1,305,323 $ 1,220,591
============= =============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Bond Fund
Investment in Securities
at May 31, 1996 (Unaudited)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------
U.S.Government Obligations 26.6%
U.S. Treasury Obligations 22.1%
<S> <C>
2-Year:
Note 6%,'97 1900M $ 1,899,753
--------------
5-Year:
Note 5.5%,'00 1600M 1,529,488
--------------
10-Year:
Note 6.375%,'02 2000M 1,966,200
Note 7.5%,'05 7000M 7,288,750
Note 5.625%,'06 10000M 9,174,100
--------------
18,429,050
--------------
Total U.S. Treasury Obligations 21,858,291
--------------
U.S. Government Agency Obligations 4.5%
Federal Home Loan Mortgage Corporation 0.4%
5-Year:
6.835%,'99 395M 394,709
--------------
Federal National Mortgage Association 4.0%
Collateralized Mortgage Obligation:
148(B), 0%,'98 1862M 1,774,855
--------------
Principal Strips:
0%,'01 1270M 1,241,006
0%,'01 1000M 972,130
--------------
2,213,136
--------------
Total Federal National
Mortgage Association 3,987,991
Government National Mortgage Association 0.1%
30-year:
13%,'11 26M 28,718
13%,'13 1M 1,081
Total Government National
Mortgage Association 29,799
Total U.S. Government
Agency Obligations 4,412,499
Total U.S. Government Obligations --------------
(Cost $27,344,059) 26,270,790
--------------
Bonds 67.3%
Beverages 1.0%
Anheuser Busch 8.5%,'17 964M 1,003,765
Canadian 3.4% --------------
Province of Nova Scotia
9.375%,'02 3000M 3,322,500
Financial Institutions 14.6% --------------
Bank of America Mortgage-Backed
Certificates 9.5%,'08 38M 38,052
Bankers Trust 7.125%,'06 2500M 2,409,375
First Bank of Puerto Rico
7.625%,'05 1500M 1,438,125
First Union Corp. 6.18%,'36 2325M 2,141,906
Lehman Brothers Holdings
8.8%,'15 2000M 2,180,000
Midland Bank 7.65%,'25 2600M 2,652,000
Salomon Bros. 6.75%,'03 1000M 951,250
Salomon Bros. 6.875%,'03 2750M 2,591,875
--------------
14,402,583
--------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------
<S> <C>
Foreign Financial Institutions 9.6%
Banque-Paribas (Fr.)
6.875%,'09 2750M $ 2,492,188
Santander Financial (Spa.)
7%,'06 3000M 2,887,500
Swedish Export Credit
9.875%,'38 3770M 4,128,150
--------------
9,507,838
--------------
Industrial - Diversified 7.2%
General Dynamics 9.95%,'18 2000M 2,180,000
TCI Communications 8%,'05 3750M 3,637,500
Tosco Corp 8.25%,'03 1250M 1,293,750
--------------
7,111,250
--------------
Insurance 14.7%
Continental Corp. 7.25%,'03 1310M 1,296,900
Farmers Insurance Exchange
8.5%,'04 2500M 2,509,375
Integon Corp. 8%,'99 750M 749,062
Integon Corp. 9.5%,'01 1500M 1,575,000
Liberty Mutual 8.2%,'07 2000M 2,065,000
Pacific Mutual 7.9%,'23 3000M 2,932,500
Prudential Insurance
7.65%,'07 3500M 3,447,500
--------------
14,575,337
Retail 2.1%
May Dept. Store 9.125%,'16 2000M 2,100,000
--------------
Telecommunications 2.2%
Comsat 8.05%,'06 2000M 2,140,800
--------------
Utilities - Electric 6.6%
Gulf State Utilities 8.94%,'22 2000M 1,950,000
Mississippi Power & Light
8.8%,'05 2500M 2,559,375
Niagara Mohawk 9.25%,'01 2000M 1,980,000
--------------
6,489,375
--------------
Utilities - Gas 4.3%
Arkla Inc. 10%,'19 1000M 1,095,000
Consolidated Natural Gas
8.625%,'11 2000M 2,100,000
Transco Gas Pipeline Corp.
9.125%,'17 1000M 1,047,500
--------------
4,242,500
--------------
Utilities - Telephone 1.6%
NYNEX Capital Funding
7.63%,'09 1500M 1,562,685
--------------
Total Bonds
(Cost $67,713,752) 66,458,633
--------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------
<S> <C>
Corporate Short-Term Notes 11.0%
Beneficial Corp. 5.29%,
06/18/96 2000M $ 1,995,004
Commercial Credit Corp. 5.27%,
06/21/96 1600M 1,595,316
National City Bank 5.28%,
06/18/96 4000M 3,990,027
Norwest Financial 5.27%,
06/18/96 3300M 3,291,787
--------------
Total Corporate Short-Term Notes
(Cost $10,872,134) 10,872,134
--------------
Total Investments
(Cost $105,929,945)* 103,601,557
Excess of Liabilities
Over Other Assets (4.9%) (4,837,198)
--------------
Net Assets $98,764,359
==============
</TABLE>
- --------------------------------------------------------------------------------
* The aggregate cost for federal income tax purposes was $105,935,510. At May
31, 1996, net unrealized depreciation for federal income tax purposes
aggregated $2,333,953 of which $434,508 related to appreciated securities and
$2,768,461 related to depreciated securities.
See Notes to Financial Statements.
<PAGE>
Sentinel Bond Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets
<S> <C>
Investments at value $103,601,557
Cash and cash equivalents 183,892
Receivable for securities sold 2,357,765
Receivable for fund shares sold 30,416
Receivable for interest 2,004,705
-------------
Total Assets 108,178,335
-------------
Liabilities
Payable for securities purchased 9,293,311
Payable for fund shares repurchased 1,267
Accrued expenses 34,539
Management fee payable 44,497
Distribution fee payable (Class A Shares) 27,744
Distribution fee payable (Class B Shares) 415
Fund service fee payable 12,203
-------------
Total Liabilities 9,413,976
-------------
Net Assets Applicable to Outstanding Shares $ 98,764,359
=============
Net Asset Value and Offering Price per Share
Class A Shares
$98,116,406 / 15,946,041 shares outstanding $ 6.15
Sales Charge -- 4.00% of offering price 0.26
-------------
Maximum Offering Price $ 6.41
=============
Class B Shares
$647,953 / 105,231 shares outstanding $ 6.16
=============
Net Assets Represent
Capital stock at par value $ 160,513
Paid-in capital 104,187,147
Distributions in excess of net
investment income (18,359)
Accumulated undistributed net realized loss
on investments (3,236,554)
Unrealized depreciation of investments (2,328,388)
-------------
Net Assets $ 98,764,359
=============
Investments at Cost $105,929,945
=============
</TABLE>
See Notes to Financial Statements.
Sentinel Bond Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- -------------------------------------------------------------------
<TABLE>
<CAPTION>
Investment Income
<S> <C>
Income:
Interest $ 4,010,375
-------------
Expenses:
Management advisory fee 280,663
Transfer agent and custodian 84,707
Distribution expense (Class A Shares) 106,240
Distribution expense (Class B Shares) 585
Accounting Services 22,472
Professional fees 11,800
Reports and notices to shareholders 3,584
Directors' fees and expenses 5,726
Other 11,173
-------------
Total Expenses 526,950
Expense Offset (12,333)
-------------
Net Expenses 514,617
-------------
Net Investment Income 3,495,758
-------------
Realized and Unrealized Gain
(Loss) on Investments
Net realized gain on sales of investments 200,135
Net change in unrealized appreciation (5,719,040)
-------------
Net Realized and Unrealized Loss
on Investments (5,518,905)
-------------
Net Decrease in Net Assets from Operations $(2,023,147)
=============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Bond Fund
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
------------- ------------
<S> <C> <C>
Increase (Decrease) in Net Assets from
Operations
Net Investment income $ 3,495,758 $ 6,689,451
Net realized gain on sales of investments 200,135 1,989,093
Net change in unrealized appreciation (5,719,040) 8,007,845
------------- ------------
Net increase (decrease) in net assets from
operations (2,023,147) 16,686,389
------------- ------------
Distributions to Shareholders
From net investment income
Class A Shares (3,502,206) (6,677,766)
Class B Shares (3,480) -
From net realized gain on investments
Class A Shares - -
Class B Shares - -
------------- ------------
Total distributions to shareholders (3,505,686) (6,677,766)
------------- ------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 11,111,538 19,152,787
Class B Shares 652,991 -
Net asset value of shares in reinvestment
of dividends and distributions
Class A Shares 2,513,479 4,951,462
Class B Shares 3,480 -
Net asset value of shares in exchange for
net assets of another investment company - 31,075,198
------------- ------------
14,281,488 55,179,447
Less: Payments for shares reacquired
Class A Shares (18,742,228) (36,920,567)
Class B Shares (619) -
------------- ------------
Increase (decrease) in net assets from
capital share transactions (4,461,359) 18,258,880
------------- ------------
Total Increase (Decrease) in Net Assets for
period (9,990,192) 28,267,503
Net Assets: Beginning of period 108,754,551 80,487,048
------------- ------------
Net Assets: End of period $ 98,764,359 $108,754,551
============= ============
Undistributed Net Investment Loss
at End of Period $ (18,359) $ (8,604)
============= ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Tax-Free Income Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------------------------------------
<S> <C> <C>
Bonds 99.1%
California 9.2%
California Health Facility Children's
Hospital San Francisco (MBIA)
7.5%, 10/01/20 350M $ 381,819
California State G/O
6.25%, 04/01/08 4000M 4,261,440
Hesperia, CA.,
Water District (FGIC)
7.2%, 06/01/15 280M 310,923
Sacramento, CA.,
Redevelopment Agy. (MBIA)
6.5%, 11/01/13 1160M 1,217,374
San Mateo Cnty, CA.,
Power Rev. (AMBAC)
6.5%, 07/01/15 3000M 3,232,980
-------------
9,404,536
-------------
Colorado 5.1%
Arapahoe County, CO.,
Capital Improvements
6.95%, 08/31/20 1500M 1,545,945
7%, 08/31/26 3500M 3,606,890
-------------
5,152,835
-------------
Connecticut 1.0%
Connecticut State Special
Tax Oblig.
6.15%, 09/01/09 1000M 1,063,360
-------------
Delaware 1.1%
University of Delaware
Hsg. & Dng. Facs.
6.625%, 11/01/10 500M 540,940
Delaware Health Facs. Auth.
Millford Memorial Hospital
7.625%, 11/01/10 500M 534,450
-------------
1,075,390
-------------
District of Columbia 0.5%
District of Columbia
G/O (AMBAC)
7.5%, 06/01/09 500M 547,315
-------------
Florida 5.7%
Charlotte County Utility
System (FGIC)
5.25%, 10/01/21 1700M 1,545,164
Sarasota County Utility
System (AMBAC)
7.5%, 06/01/05 3000M 3,166,020
University Community
Hospital, Inc. (FSA)
7.5%, 09/01/11 1000M 1,126,920
-------------
5,838,104
-------------
Hawaii 1.1%
Department of Budget Finance
7.65%, 07/01/19 1000M 1,147,510
Hawaii Housing Finance
& Dev. Corp
7.8%, 07/01/29 10M 10,486
-------------
1,157,996
-------------
Idaho 0.7%
Idaho Housing Agency
8%, 01/01/20 635M 664,750
-------------
- ------------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------------------------------------
Illinois 6.2%
Chicago, Ill., General
Obligation (AMBAC)
6.25%, 01/01/08 500M $ 530,445
Illinois Development
Finance Auth.
7.6%, 03/01/14 1000M 1,095,550
Illinois Education Facility
Auth. Rev.
6.1%, 12/15/16 560M 559,334
Illinois Housing Dev. Auth.
Multi-Family Series A
7%, 07/01/10 990M 1,039,639
Illinois State Sales Tax Rev.
7.3%, 06/15/00 2000M
6%, 06/15/12 2000M 2,045,520
6.5%, 06/15/13 1000M 1,072,820
-------------
6,343,308
-------------
Indiana 0.1%
Indianapolis Economic Dev. Rev.
7.8%, 12/01/17 55M 56,628
-------------
Kansas 0.2%
Kansas City, Leavenworth
County & City of Lenexa
Series A - Mtg. Rev.
8.4%, 05/01/15 160M 164,998
-------------
Kentucky 0.2%
Kentucky State Turnpike Auth.
7.375%, 05/15/07 150M 166,161
-------------
Louisiana 0.5%
Jefferson, La. Sales Tax
Rev. (MBIA)
8.25%, 07/01/02 500M 551,705
-------------
Massachusetts 4.2%
Massachusetts State G/O
6.875%, 07/01/10 1000M 1,110,500
6%, 08/01/09 (FGIC) 1000M 1,053,970
Massachusetts State Health
& Education Facs.
Beth Israel Hospital Revenue
7%, 07/01/09 1000M 1,048,890
Massachussetts State Health
& Education Facs.
New England Baptist
Hospital Revenue
7.3%, 7/01/11 1000M 1,060,950
-------------
4,274,310
-------------
Michigan 1.2%
Michigan State Building
Auth. Rev.
6.25%, 10/01/20 170M 171,569
Michigan State Housing
Dev. Auth.
5.45%, 07/15/11 200M 192,808
Royal Oak Hospital Finance Auth.
7.375%, 01/01/20 750M 817,080
-------------
1,181,457
-------------
- -----------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------------------------------------
Missouri 1.2%
Central Missouri
State Univ. (MBIA)
7%, 07/01/14 1000M $1,118,480
Missouri Housing
Development Comm.
9.375%, 04/01/16 75M 78,871
-------------
1,197,351
Nebraska 2.0%
Omaha Public Power Elec. Rev.
6.15%, 02/01/12 1000M 1,050,340
7.625%, 02/01/12 1000M 1,025,230
-------------
2,075,570
-------------
Nevada 1.0%
Clark Cnty, Nevada
McCarran Int'l. Airport
6.15%, 07/01/07 (AMBAC) 1000M 1,043,840
-------------
New Hampshire 0.8%
New Hampshire Higher
Education & Health (MBIA)
7.625%, 07/01/20 750M 829,598
-------------
New Jersey 1.1%
University of Medicine
& Dentistry
7.2%, 12/01/19 1000M 1,098,280
-------------
New York 18.8%
New York City, NY
6.5%, 02/15/06 3500M 3,600,905
7.1%, 02/01/09 1200M 1,263,468
New York City Mun.
Water Fin. Auth.
7%, 06/15/01 250M 276,865
New York Dorm. Auth.
5.625%, 07/01/16 3250M 3,012,295
6%, 08/15/16 2800M 2,754,668
New York State Environmental Facs. Corp.
PCR - Water Revolving Fund Project
7.25%, 06/15/10 50M 55,820
6.6%, 09/15/12 1450M 1,563,013
New York State Medical Care Facs.
Mental Health Services Facs.
7.875%, 08/15/08 250M 277,115
New York State Metro
Transit Auth
5.75%, 07/01/13 2000M 1,907,920
Triborough Bridge &
Tunnel Authority
6%, 01/01/12 3250M 3,356,373
6.625%, 01/01/12 500M 548,380
8.125%, 01/01/12 500M 535,085
-------------
19,151,907
Ohio 1.7%
Ohio Housing Finance Auth.
7.05%, 09/01/16 690M 711,942
Ohio State Higher Educ. Facs.
6%, 10/01/14 1000M 1,007,650
-------------
1,719,592
-------------
</TABLE>
(continued)
<PAGE>
Sentinel Tax-Free Income Fund
Investment in Securities (cont'd)
at May 31, 1996 (Unaudited)
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------------------------------------
<S> <C> <C>
Oregon 3.9%
Klamath Falls Elec. Rev.
4.5%, 05/01/23 4000M $ 4,007,120
-------------
Pennsylvania 6.3%
Allegheny County Sanitation
Auth. (FGIC)
7.5%, 12/01/16 500M 541,505
Montgomery County Higher
Ed. & Hlth. Auth.
8.3%, 06/01/10 500M 571,115
Pennsylvania State G/O
6.25%, 07/01/10 2000M 2,137,400
6.25%, 07/01/11 2000M 2,137,380
Pennsylvania Higher
Education Facs. Auth.
7.2%, 07/01/19 (MBIA) 1000M 1,088,030
-------------
6,475,430
-------------
Puerto Rico 7.8%
Puerto Rico Commonwealth
Highway & Transportation
Auth. Rev.
5.5%, 07/01/36 3500M 3,176,880
Puerto Rico Electric
Power Auth.
6.125%, 07/01/08 2000M 2,103,700
Puerto Rico Public
Buildings Rev.
6.25%, 07/01/14 (AMBAC) 1100M 1,171,489
5.5%, 07/01/21 1500M 1,377,885
-------------
7,829,954
-------------
South Carolina 1.0%
Piedmont Municipal
Power Agency
6.25%, 01/01/09 (MBIA) 1000M 1,060,830
-------------
Tennessee 0.1%
Volunteer State Student
Funding Corp. Rev.
4.85%, 06/01/99 75M 74,567
-------------
Texas 0.1%
Matagorda County, Texas
PCR Power & Light
7.875%, 12/01/16 50M 51,656
Sabine River Auth. PCR
8.25%, 10/01/20 50M 54,975
-------------
106,631
-------------
Utah 0.1%
Utah State Housing Finance Auth.
7.25%, 07/01/22 30M 31,309
-------------
- -----------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- -----------------------------------------------------------------------------
Vermont 4.7%
Burlington Electric
Revenue (MBIA)
6%, 07/01/06 1550M $ 1,639,962
Champlain Water District
7.125%, 10/01/03 175M 190,722
7.125%, 10/01/04 145M 158,424
7.125%, 10/01/06 200M 221,820
Vermont Education &
Health Building
7.05%, 10/01/16 900M 975,753
7%, 10/01/22 250M 281,905
5.375%, 11/01/26 1450M 1,316,411
-------------
4,784,997
-------------
Virginia 5.8%
Chesapeake Bay Bridge &
Tunnel (MBIA)
5.52%, 07/01/16 2235M 2,065,296
Fairfax County Water Auth.
7.25%, 01/01/27 1000M 1,101,590
Virginia State Public
Building Auth.
5.2%, 08/01/15 3000M 2,763,900
-------------
5,930,786
-------------
Washington 5.7%
Snohomish County G/O
7.1%, 12/01/07 500M 549,315
Washington State Motor
Vehicle Fuel
6.2%, 03/01/11 1220M 1,278,889
Washington State Public
Power Supply
System Proj. #2
7.625%, 07/01/10 250M 282,698
Washington State Public
Power Supply
System Proj. #3 (MBIA)
7.125%, 07/01/16 3295M 3,749,084
-------------
5,859,986
-------------
Total Bonds
(Cost $97,606,904) 100,920,601
-------------
- ------------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ------------------------------------------------------------------------------
Short-Term Investments 0.2%
Port St. Helens, Oregon
General Electric Project
4%, 06/01/10 (a)
(Cost $200,000) 200M $ 200,000
-------------
Total Investments
(Cost $97,806,904)* 101,120,601
Excess of Other Assets
Over Liabilities 0.7% 732,180
-------------
Net Assets $ 101,852,781
=============
</TABLE>
- ------------------------------------------------------------------------------
* Also cost for federal income tax purposes.
At May 31, 1996, net unrealized appreciation for federal income tax purposes
aggregated $3,313,697 of which $3,679,074 related to appreciated securities
and $365,377 related to depreciated securities.
(a) Variable rate security that may be tendered back to issuer prior to
maturity, at par.
The following abbreviations are used in portfolio descriptions:
(AMBAC) - Guaranteed by American Municipal Bond Association Corp.
(FGIC) - Guaranteed by Financial Guaranty Insurance Co.
(FSA) - Guaranteed by Financial Security Assurance Inc.
(MBIA) - Guaranteed by Municipal Bond Investors Assurance Corp.
G/O - General Obligation Bond
PCR - Pollution Control Revenue Bond
See Notes to Financial Statements.
<PAGE>
Sentinel Tax-Free Income Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- ---------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets
<S> <C>
Investments at value $101,120,601
Receivable for fund shares sold 247,234
Receivable for interest 2,178,133
-------------
Total Assets 103,545,968
-------------
Liabilities
Payable for securities purchased 1,350,480
Payable for fund shares repurchased 50,820
Accrued expenses 40,410
Management fee payable 45,803
Distribution fee payable (Class A Shares) 26,535
Distribution fee payable (Class B Shares) 232
Fund service fee payable 10,045
Payable to custodian bank 168,862
-------------
Total Liabilities 1,693,187
-------------
Net Assets Applicable to Outstanding Shares $101,852,781
=============
Net Asset Value and Offering Price per Share
Class A Shares
$101,507,788 / 7,758,933 shares outstanding $ 13.08
Sales Charge -- 4.00% of offering price 0.55
-------------
Maximum Offering Price $ 13.63
=============
Class B Shares
$344,993 / 26,362 shares outstanding $ 13.09
=============
Net Assets Represent
Capital stock at par value $ 77,853
Paid-in capital 98,197,929
Accumulated undistributed net investment income 6,336
Accumulated undistributed net realized gain
on investments 256,966
Unrealized appreciation of investments 3,313,697
-------------
Net Assets $101,852,781
=============
Investments at Cost $ 97,806,904
=============
See Notes to Financial Statements
Sentinel Tax-Free Income Fund
Statement of Operations
For the Six Months Ended May 31, 1996
(Unaudited)
- ---------------------------------------------------------------------
Investment Income
Income:
Interest $ 3,131,778
-------------
Expenses:
Management advisory fee 283,332
Transfer agent and custodian 70,383
Distribution expense (Class A Shares) 107,290
Distribution expense (Class B Shares) 269
Accounting Services 22,676
Professional fees 13,608
Reports and notices to shareholders 4,250
Directors' fees and expenses 5,799
Other 27,438
-------------
Total Expenses 535,045
Expense Offset (18,268)
Net Expenses 516,777
Net Investment Income 2,615,001
-------------
Realized and Unrealized Gain (Loss)
on Investments
Net realized gain on sales of investments 400,770
Net change in unrealized appreciation (4,649,999)
-------------
Net Realized and Unrealized Loss
on Investments (4,249,229)
-------------
Net Decrease in Net Assets from Operations $(1,634,228)
=============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Tax-Free Income Fund
Statement of Changes in Net Assets
- ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
---------------- ---------------
<S> <C> <C>
Increase (Decrease) in Net Assets from
Operations
Net Investment income $ 2,615,001 $ 5,344,289
Net realized gain on sales of investments 400,770 1,604,746
Net change in unrealized appreciation (4,649,999) 8,580,337
Net increase (decrease) in net assets from
operations (1,634,228) 15,529,372
---------------- ---------------
Distributions to Shareholders
From net investment income
Class A Shares (2,611,053) (5,344,668)
Class B Shares (1,120) -
From net realized gain on investments
Class A Shares - -
Class B Shares - -
---------------- ---------------
Total distributions to shareholders (2,612,173) (5,344,668)
---------------- ---------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 7,140,186 19,708,036
Class B Shares 346,603 -
Net asset value of shares in reinvestment
of dividends and distributions
Class A Shares 1,732,350 3,604,212
Class B Shares 1,120 -
Net asset value of shares in exchange
for net assets of another
investment company - 4,493,940
---------------- ---------------
9,220,259 27,806,188
Less: Payments for shares reacquired
Class A Shares (13,626,697) (27,420,131)
Class B Shares (125) -
---------------- ---------------
Increase (decrease) in net assets from
capital share transactions (4,406,563) 386,057
---------------- ---------------
Total Increase (Decrease) in Net
Assets for period (8,652,964) 10,570,761
Net Assets: Beginning of period 110,505,745 99,934,984
Net Assets: End of period $101,852,781 $110,505,745
================ ===============
Undistributed Net Investment Income
at End of Period $ 6,336 $ 3,508
================ ===============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel New York Tax-Free Income Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- -----------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- -----------------------------------------------
Bonds 90.6%
New York 84.9%
Metro Transportation Authority
5.75%, 07/01/13 250M $ 238,490
Monroe County Water Improvement
5.60%, 12/01/11 (MBIA) 225M 221,794
New York City Municipal Assistance Corp.
4.30%, 07/01/99 225M 223,270
New York City Municipal Water Fin. Auth.
6.75%, 06/15/14 (FGIC) 35M 37,819
6.00%, 06/15/17 100M 97,779
New York City Series E
6.50%, 02/15/06 250M 257,207
New York State G/O
7.15%, 02/01/08 80M 86,770
New York State Dorm. Authority Revenue
Cornell Univ. - Ser A
7.375%, 07/01/30 50M 55,005
State Univ. Educ. Fac. - Ser A
7.20%, 05/15/06 300M 339,699
Univ. Rochester - Stron Mem. Hosp.
5.50%, 07/01/21 300M 273,441
Department of Health
5.50%, 07/01/20 125M 111,554
City Univ. System
5.625%, 07/01/16 250M 231,715
New York State Energy Resources
7.50%, 07/01/25 50M 53,445
New York State Environmental Facilities
5.75%, 03/15/13 300M 281,844
New York State Environmental Water Revenue
7.25%, 06/15/10 60M 66,985
New York State Housing Finance Agency
5.625%, 05/01/02 250M 248,068
New York State Local Govt. Assistance Corp.
7.00%, 04/01/08 100M 109,463
New York State Medical Care Facilities
7.875%, 08/15/20 20M 22,177
7.30%, 02/15/21 25M 27,348
Hospitals & Nursing Homes
5.75%, 08/15/19 170M 162,647
6.45%, 02/15/09 230M 236,592
7.25%, 02/15/24 50M 53,164
New York State Mortgage Agency Revenue
7.80%, 10/01/13 150M 159,967
7.95%, 04/01/22 100M 106,282
New York State Thwy. Auth. Service Contract
6.25%, 04/01/14 200M 198,282
New York State Urban Development Corp.
5.70%, 04/01/20 250M 231,597
Port Authority NY & NJ
5.00%, 07/15/12 70M 63,570
Suffolk County NY Water Authority
5.625%, 06/01/16 (AMBAC) 170M 162,632
Triborough Bridge & Tunnel Authority
6.00%, 01/01/12 250M 258,183
6.875%, 01/01/15 65M 69,499
------------
4,686,288.00
------------
<TABLE>
<CAPTION>
- -----------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- -----------------------------------------------
<S> <C> <C> <C>
Puerto Rico 5.7%
Puerto Rico Commonwealth
7.15%, 07/01/03 50M $ 55,415
Puerto Rico Commonwealth
Aqueduct & Sewer
6.00%, 07/01/09 250M 257,763
---------------
313,178
---------------
Total Bonds
(Cost $4,830,029) 4,999,466
---------------
Short-Term Investments 5.4%
New York City G/O
3.10%, 08/15/22 (a) 100M 100,000
New York Local Assistance
3.40%, 04/01/2022 (a) 200M 200,000
---------------
Total Short-term Investments
(Cost $300,000) 300,000
---------------
Total Investments
(Cost $5,130,029) 5,299,466
Excess of Other Assets
Over Liabilities 4.0% 222,345
---------------
Net Assets $ 5,521,811
===============
</TABLE>
- -----------------------------------------------
* Also cost for federal income tax purposes.
At May 31, 1996, net unrealized appreciation
for federal income tax purposes aggregated
$169,437 of which $189,154 related to
appreciated securities and $19,717 related
to depreciated securities.
(a) Variable rate security that may be tendered
back to issuer prior to maturity, at par.
The following abbreviations are used in
portfolio descriptions:
(AMBAC) - Guaranteed by American Municipal
Bond Association Corp.
(FGIC) - Guaranteed by Financial Guaranty
Insurance Co.
(MBIA) - Guaranteed by Municipal Bond
Investors Assurance Corp.
G/O - General Obligation Bond
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel New York Tax-Free Income Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- ------------------------------------------------------------------
<S> <C>
Assets
Investments at value $5,299,466
Cash and cash equivalents 130,561
Receivable for interest 100,089
-------------
Total Assets 5,530,116
-------------
Liabilities
Accrued expenses 3,815
Management fee payable 2,473
Distribution fee payable 1,599
Fund service fee payable 418
-------------
Total Liabilities 8,305
-------------
Net Assets Applicable to Outstanding Shares $5,521,811
=============
Net Asset Value and Offering Price per Share
$5,521,811/490,873 shares outstanding $ 11.25
Sales Charge--4.00% of Offering Price 0.47
Maximum Offering Price Per Share $ 11.72
=============
Net Assets Represent
Capital stock at par value $ 4,909
Paid-in capital 5,378,959
Accumulated undistributed net investment income 421
Accumulated undistributed net realized loss
on investments (31,915)
Unrealized appreciation of investments 169,437
-------------
Net Assets $5,521,811
=============
Investments at Cost $5,130,029
=============
</TABLE>
See Notes to Financial Statements.
<TABLE>
<CAPTION>
Sentinel New York Tax-Free Income Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- ------------------------------------------------------------------
<S> <C>
Investment Income
Income:
Interest $ 154,455
-------------
Expenses:
Management advisory fee 14,222
Transfer agent and custodian 4,645
Distribution expense 5,390
Accounting Services 1,125
Professional fees 1,010
Reports and notices to shareholders 1,256
Directors' fees and expenses 296
Other 4,324
-------------
Total Expenses 32,268
Expense Offset (1,835)
-------------
Net Expenses 30,433
-------------
Net Investment Income 124,022
-------------
Realized and Unrealized Gain (Loss) on Investments
Net realized gain on sales of investments 19,454
Net change in unrealized appreciation (238,327)
-------------
Net Realized and Unrealized Loss on Investments (218,873)
-------------
Net Decrease in Net Assets from Operations $ (94,851)
=============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel New York Tax-Free Income Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Eight Months
Ended Ended
5/31/96 11/30/95*
(Unaudited)
------------- -------------
<S> <C> <C>
Increase (Decrease) in Net Assets from Operations
Net Investment income $ 124,022 $ 158,532
Net realized gain (loss) on sales of investments 19,454 (47,300)
Net change in unrealized appreciation (238,327) 289,172
------------- -------------
Net increase (decrease) in net assets from
operations (94,851) 400,404
------------- -------------
Distributions to Shareholders
From net investment income (123,994) (158,139)
From realized gain on investments - -
------------- -------------
Total distributions to shareholders (123,994) (158,139)
From Capital Share Transactions
Net proceeds from sales of shares 546,603 984,046
Net asset value of shares in reinvestment
of dividends and distributions 118,005 147,544
Net asset value of shares in exchange for
net assets of another investment company - 5,759,369
------------- -------------
664,608 6,890,959
Less: Payments for shares reacquired (256,355) (1,800,821)
------------- -------------
Increase in net assets from capital share
transactions 408,253 5,090,138
------------- -------------
Total Increase in Net Assets for period 189,408 5,332,403
Net Assets: Beginning of period 5,332,403 -
------------- -------------
Net Assets: End of period $5,521,811 $5,332,403
============ =============
Undistributed Net Investment Income
at End of Period $ 421 $ 393
============ =============
</TABLE>
* Commenced operations March 27, 1995.
See Notes to Financial Statements.
<PAGE>
Sentinel Government Securities Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- --------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------
U.S. Government Obligations 123.7%
U.S. Treasury Obligations 59.7%
3-Year:
Note 5.5%, '98 7500M $ 7,357,050
5-Year:
Note 5.75%, '00 3000M 2,901,330
Note 6.25%, '01 10000M 9,838,100
12,739,430
10-Year:
Note 5.625%, '06 40000M 36,696,400
30-Year:
Note 7.25%, '16 2000M 2,018,820
Total U.S. Treasury Obligations 58,811,700
U.S. Government Agency Obligations 64.0%
Federal Agricultural Mortgage Corporation 5.6%
Agency Discount Note:
5.2%, 06/17/96 5500M 5,487,289
Federal Farm Credit Bank 22.2%
Agency Discount Notes:
5.21%, 07/11/96 18000M 17,895,800
5.21%, 07/15/96 4000M 3,974,529
21,870,329
Federal Home Loan Mortgage Corporation 2.7%
Collateralized Mortgage Obligation:
1779(H), 8.5%, '00 1284M 1,322,797
15-Year:
8.5%, '98 59M 60,691
30-Year:
8.25%, '04 246M 249,414
11%, '09 25M 27,861
10.5%, '13 45M 48,670
11%, '15 13M 14,428
11%, '15 66M 72,491
11%, '15 81M 89,014
11%, '15 48M 53,177
11%, '16 14M 15,042
11%, '16 33M 36,652
11%, '17 17M 19,002
11%, '17 204M 224,542
10.5%, '18 251M 273,516
10.5%, '18 158M 172,308
11%, '20 12M 13,749
1,309,866
Total Federal Home Loan
Mortgage Corporation 2,693,354
- ----------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ----------------------------------------------
Federal National Mortgage Association 20.2%
Agency Discount Note:
5.19%, 06/24/96 1500M $ 1,495,026
-------------
Collateralized Mortgage Obligation:
148(B), 0%, '98 5586M 5,324,564
-------------
15-Year:
8.25%, '02 170M 174,409
6%, '11 3960M 3,719,905
6.5%, '11 3960M 3,806,868
7%, '11 3960M 3,895,654
-------------
11,596,836
-------------
30-Year:
11%, '10 1350M 1,508,625
-------------
Total Federal National
Mortgage Association 19,925,051
-------------
Government National
Mortgage Association 13.3%
Collateralized Mortgage Obligation:
1994-1(PC), 7.2%, '16 5000M 5,051,562
-------------
10-Year:
7%, '03 772M 762,623
7%, '03 1087M 1,074,451
-------------
1,837,074
-------------
15-Year:
10%, '01 43M 45,149
7%, '11 5000M 4,931,250
-------------
4,976,399
-------------
30-Year:
9.75%, '13 324M 345,391
11%, '14 61M 66,987
10.5%, '15 59M 64,902
10.5%, '16 114M 124,611
10.5%, '17 26M 28,582
10.5%, '17 73M 80,090
10.5%, '19 53M 58,509
10.5%, '19 35M 38,168
10.5%, '19 128M 140,777
10.5%, '19 159M 174,862
10.5%, '19 37M 40,478
10.5%, '19 31M 33,975
-------------
1,197,332
-------------
Total Government National
Mortgage Association 13,062,367
-------------
Total U.S. Government
Agency Obligations 63,038,390
-------------
Total U.S. Government Obligations
(Cost $124,381,706) 121,850,090
-------------
- ----------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ----------------------------------------------
Corporate Short-Term Notes 19.7%
BankAmerica Corp. 5.27%,
07/15/96 5000M $ 4,967,795
Cargill, Inc. 5.27%,
07/15/96 5000M 4,967,794
G.E. Capital Corp. 5.27%,
06/20/96 4500M 4,487,484
Norwest Financial, Inc. 5.27%,
07/15/96 5000M 4,967,794
-------------
Total Corporate Short-Term Notes
(Cost $19,390,867) 19,390,867
-------------
Repurchase Agreement 5.0%
Repurchase agreement with Prudential
Securities, Inc. dated 05/31/96 at
5.36% to be repurchased at $4,902,189
on 06/03/96, collateralized by a
$5,650,000 FNMA Pool #303627 due 10/01/06
valued at $5,034,485.
(Cost $4,900,000) 4900M 4,900,000
-------------
Total Investments
(Cost $148,672,573)* 146,140,957
Excess of Liabilities
Over Other Assets (48.4%) (47,663,821)
-------------
Net Assets $98,477,136
=============
- -------------------------------------------------
* Also cost for federal income tax purposes.
At May 31, 1996, unrealized depreciation for
federal income tax purposes aggregated $2,531,616
of which $142,065 related to appreciated securities
and $2,673,681 related to depreciated securities.
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel Government Securities Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- -------------------------------------------------------------------
<S> <C>
Assets
Investments at value $146,140,957
Cash and cash equivalents 76,137
Receivable for securities sold 23,662
Receivable for fund shares sold 38,495
Receivable for interest 1,125,159
---------------
Total Assets 147,404,410
---------------
Liabilities
Payable for securities purchased 48,795,033
Accrued expenses 44,683
Management fee payable 44,611
Distribution fee payable 29,992
Fund service fee payable 12,955
---------------
Total Liabilities 48,927,274
---------------
Net Assets Applicable to Outstanding Shares $ 98,477,136
===============
Net Asset Value and Offering Price per Share
$98,477,136/10,115,699 shares outstanding $ 9.74
Sales Charge -- 4.00% of Offering Price 0.41
---------------
Maximum Offering Price Per Share $ 10.15
===============
Net Assets Represent
Capital stock at par value $ 101,157
Paid-in capital 105,991,532
Accumulated undistributed net investment income 659
Accumulated undistributed net realized loss
on investments (5,084,596)
Unrealized depreciation of investments (2,531,616)
---------------
Net Assets $ 98,477,136
===============
Investments at Cost $148,672,573
===============
</TABLE>
See Notes to Financial Statements.
Sentinel Government Securities Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- ------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Investment Income
Income:
Interest $ 3,708,888
---------------
Expenses:
Management advisory fee 277,578
Transfer agent and custodian 102,551
Distribution expense 105,190
Accounting Services 22,250
Professional fees 11,400
Reports and notices to shareholders 7,038
Directors' fees and expenses 5,686
Other 11,776
---------------
Total Expenses 543,469
Expense Offset (15,411)
---------------
Net Expenses 528,058
---------------
Net Investment Income 3,180,830
---------------
Realized and Unrealized Loss on Investments
Net realized loss on sales of investments (1,527,592)
Net change in unrealized appreciation (4,412,389)
---------------
Net Realized and Unrealized Loss on Investments (5,939,981)
---------------
Net Decrease in Net Assets from Operations $(2,759,151)
===============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Government Securities Fund
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
--------------- ---------------
<S> <C> <C>
Increase (Decrease) in Net Assets from
Operations
Net Investment income $ 3,180,830 $ 6,843,293
Net realized gain (loss) on sales of
investments (1,527,592) 3,976,086
Net change in unrealized appreciation (4,412,389) 6,533,082
-------------- --------------
Net increase (decrease) in net assets from
operations (2,759,151) 17,352,461
-------------- --------------
Distributions to Shareholders
From net investment income (3,148,501) (6,684,083)
From net realized gain on investments - -
-------------- --------------
Total distributions to shareholders (3,148,501) (6,684,083)
-------------- --------------
From Capital Share Transactions
Net proceeds from sales of shares 7,886,571 12,011,122
Net asset value of shares in reinvestment
of dividends and distributions 2,443,973 5,223,850
-------------- --------------
10,330,544 17,234,972
Less: Payments for shares reacquired (14,045,944) (24,260,467)
-------------- --------------
Decrease in net assets from capital share
transactions (3,715,400) (7,025,495)
-------------- --------------
Total Increase (Decrease) in Net Assets for
period (9,623,052) 3,642,883
Net Assets: Beginning of period 108,100,188 104,457,305
-------------- --------------
Net Assets: End of period $ 98,477,136 $108,100,188
============== ==============
Undistributed Net Investment Income (Loss)
at End of Period $ 659 $ (2,180)
============== ==============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Short-Intermediate Government Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- --------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------
U.S. Government Obligations 83.6%
U.S. Treasury Obligations 2.5%
10-Year:
Note 5.625%, '06 1000M $ 917,410
-------------
U.S. Government Agency Obligations 81.1%
Federal Home Loan Mortgage Corporation 48.4%
Collateralized Mortgage Obligations:
1779(H), 8.5%, '00 1247M 1,284,932
1057(D), 8%, '00 1193M 1,213,144
1817(G), 6.5%, '01 1913M 1,904,395
1317-E, 7%, '04 1059M 1,061,416
1729-D, 6.6%, '17 1000M 997,860
53(A) P11, 9.5%, '20 20M 20,078
-------------
6,481,825
-------------
5-Year:
6.835%, '99 257M 256,561
8%, '00 655M 668,943
8%, '00 659M 662,705
7%, '00 1182M 1,185,508
8%, '00 595M 598,179
-------------
3,371,896
-------------
10-Year:
6.5%, '04 1023M 988,547
15-Year:
8.5%, '01 1006M 1,033,965
9.5%, '01 2M 2,364
9%, '01 437M 452,142
9%, '01 410M 423,903
9.5%, '01 6M 5,718
8%, '02 1015M 1,032,826
7.5%, '02 854M 856,128
9.5%, '03 4M 4,401
9.5%, '03 8M 8,480
10%, '05 189M 197,140
7%, '10 936M 920,358
-------------
4,937,425
-------------
30-Year:
7%, '06 1272M 1,247,249
7%, '07 686M 672,666
10.25%, '09 29M 30,867
-------------
1,950,782
-------------
Total Federal Home Loan
Mortgage Corporation 17,730,475
-------------
- --------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------
Federal National Mortgage Association 30.6%
Collateralized Mortgage Obligations:
1992 - 20(PG) 951M $ 952,358
-------------
10-Year:
6%, '04 1456M 1,409,580
-------------
15-Year:
7.5%, '02 377M 377,721
9.0%, '02 10M 10,303
10.5%, '03 88M 92,138
7.0%, '05 1240M 1,239,908
8.0%, '05 803M 806,725
7.5%, '09 1600M 1,630,643
8.0%, '09 1034M 1,036,929
7.5%, '10 985M 987,021
-------------
6,181,388
-------------
20-Year:
7.5%, '07 404M 401,147
30-Year:
10.75%, '12 19M 20,916
11.0%, '10 2000M 2,235,000
-------------
2,255,916
-------------
Total Federal National
Mortgage Association 11,200,389
-------------
Government National Mortgage
Association 2.1%
15-Year:
14.75%, '96 0M 175
12.75%, '97 7M 7,326
10.5%, '98 12M 12,219
11.25%, '98 2M 1,991
11.25%, '98 0M 353
11.25%, '98 1M 631
11.25%, '98 1M 1,568
10.75%, '98 8M 8,955
11.25%, '98 0M 294
10.75%, '98 5M 4,820
10.75%, '98 15M 16,301
9.5%, '99 18M 18,838
10.25%, '99 17M 18,498
11.25%, '00 19M 20,402
11%, '00 12M 12,025
11%, '00 9M 9,401
9.75%, '01 15M 15,620
9.75%, '01 4M 4,582
9%, '01 41M 42,922
9.5%, '04 12M 12,447
9%, '07 47M 49,183
-------------
258,551
-------------
30-Year:
9.25%, '07 44M 45,758
9%, '09 214M 221,305
10%, '09 11M 11,370
9.75%, '10 175M 185,904
10%, '16 22M 23,628
-------------
487,965
-------------
Total Government National
Mortgage Association 746,516
-------------
Total U.S. Government
Agency Obligations 29,677,380
-------------
Total U.S. Government Obligations
(Cost $30,994,022) 30,594,790
-------------
- --------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------
Other Collateralized Mortgage
Obligations 15.9%
Collateralized Mortgage Obligation
Trust Series 27(A)
7.25%, '17 385M $ 381,142
Georgia Federal Mortgage Corp.
Series A 4 10.5%, '14 1404M 1,458,677
MDC Asset Inv. Trust XII 3
8.94%, '18 1895M 1,950,700
Merrill Lynch Trust Series 5(B)
6%, '18 124M 118,159
Merrill Lynch Trust Series 25(B)
8.75%, '19 8M 7,699
Veterans Affairs 1996-1 Class 1G
6.75%, '00 1909M 1,911,004
-------------
Total Other Collateralized Mortgage
Obligations
(Cost $5,872,996) 5,827,381
-------------
Corporate Short-Term Notes 6.9%
Beneficial Corp. 5.29%,
07/15/96 950M 943,858
Prudential Funding Corp. 5.26%,
06/24/96 1600M 1,594,623
-------------
Total Corporate Short-Term
(Cost $2,538,481) 2,538,481
-------------
Total Investments
(Cost $39,405,499)* 38,960,652
Excess of Liabilities
Over Other Assets (6.4%) (2,352,960)
Net Assets $36,607,692
=============
- ---------------------------------------------------
* Also cost for federal income tax purposes.
At May 31, 1996, unrealized depreciation for
federal income tax purposes aggregated $444,847
of which $75,956 related to appreciated
securities and $520,803 related to depreciated
securities.
See Notes to Financial Statements.
<PAGE>
Sentinel Short-Intermediate Government Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Assets
Investments at value $38,960,652
Cash and cash equivalents 423,542
Receivable for securities sold 133,897
Receivable for fund shares sold 4,924
Receivable for interest 280,794
Receivable from fund administrator 33,281
--------------
Total Assets 39,837,090
--------------
Liabilities
Payable for securities purchased 3,177,401
Accrued expenses 7,780
Management fee payable 16,391
Distribution fee payable 23,998
Fund service fee payable 3,828
--------------
Total Liabilities 3,229,398
--------------
Net Assets Applicable to Outstanding Shares $36,607,692
==============
Net Asset Value and Offering Price per Share
$36,607,692/3,794,337 shares outstanding $ 9.65
Sales Charge -- 1.00% of Offering Price $ 0.10
--------------
Maximum Offering Price Per Share $9.75
==============
Net Assets Represent
Capital stock at par value $ 37,943
Paid-in capital 38,072,147
Accumulated undistributed net investment income 1,514
Accumulated undistributed net realized loss
on investments (1,059,065)
Unrealized depreciation of investments (444,847)
--------------
Net Assets $36,607,692
==============
Investments at Cost $39,405,499
==============
</TABLE>
See Notes to Financial Statements.
Sentinel Short-Intermediate Government Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Investment Income
Income:
Interest $1,195,413
----------------
Expenses:
Management advisory fee 90,911
Transfer agent and custodian 27,422
Distribution expense 60,305
Accounting Services 7,535
Professional fees 5,275
Reports and notices to shareholders 1,434
Directors' fees and expenses 1,945
Other 19,220
----------------
Total Expenses 214,047
Expense Reimbursement (33,281)
Expense Offset (8,547)
----------------
Net Expenses 172,219
----------------
Net Investment Income 1,023,194
----------------
Realized and Unrealized Gain (Loss) on Investments
Net realized gain on sales of investments 4,460
Net change in unrealized appreciation (797,008)
----------------
Net Realized and Unrealized Loss on Investments (792,548)
----------------
Net Increase in Net Assets from Operations $ 230,646
================
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Short-Intermediate Government Fund
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Eight Months
Ended Ended
5/31/96 11/30/95*
(Unaudited)
-------------- ---------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 1,023,194 $ 837,760
Net realized gain on sales of investments 4,460 45,919
Net change in unrealized appreciation (797,008) 315,484
-------------- ---------------
Net increase in net assets from operations 230,646 1,199,163
-------------- ---------------
Distributions to Shareholders
From net investment income (995,143) (823,999)
From realized gain on sale of investments -- --
-------------- ---------------
Total distributions to shareholders (995,143) (823,999)
-------------- ---------------
From Capital Share Transactions
Net proceeds from sales of shares 20,517,785 21,848,488
Net asset value of shares in reinvestment
of dividends and distributions 803,669 683,298
Net asset value of shares in exchange for
net assets of another investment company -- 15,218,556
-------------- ---------------
21,321,454 37,750,342
Less: Payments for shares reacquired (12,365,930) (9,708,841)
-------------- ---------------
Increase in net assets from capital share
transactions 8,955,524 28,041,501
-------------- ---------------
Total Increase in Net Assets for period 8,191,027 28,416,665
Net Assets: Beginning of period 28,416,665 --
-------------- --------------
Net Assets: End of period $36,607,692 $28,416,665
============== ===============
Undistributed Net Investment Income
at End of Period $ 1,514 $ --
============== ===============
</TABLE>
* Commenced operations March 27, 1995.
See Notes to Financial Statements.
<PAGE>
Sentinel U.S.Treasury Money Market Fund
Investment in Securities
at May 31, 1996 (Unaudited)
- --------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------
U.S. Treasury Obligations 96.3%
US Treasury Bill
4.91%, 06/06/96 2000M $1,998,636
US Treasury Bill
4.94%, 06/13/96 5000M 4,991,767
US Treasury Bill
5.17%, 06/18/96 5000M 4,989,229
US Treasury Bill
5.005%, 06/20/96 1000M 997,358
US Treasury Bill
5.025%, 06/20/96 4000M 3,989,392
US Treasury Bill
5.025%, 06/20/96 4500M 4,488,066
US Treasury Bill
5.045%, 06/20/96 5000M 4,986,687
US Treasury Bill
4.915%, 06/27/96 2000M 1,992,900
US Treasury Bill
4.965%, 06/27/96 1000M 996,414
US Treasury Bill
4.98%, 06/27/96 5000M 4,982,017
US Treasury Bill
4.93%, 06/27/96 2000M 1,992,879
US Treasury Bill
4.995%, 07/05/96 1500M 1,492,924
US Treasury Bill
4.97%, 07/11/96 1500M 1,491,717
US Treasury Note
7.875%, 07/15/96 5000M 5,016,026
US Treasury Bill
4.965%, 07/25/96 3500M 3,473,934
US Treasury Note
6.125%, 07/31/96 385M 385,629
US Treasury Note
6.125%, 07/31/96 5000M 5,007,269
US Treasury Note
7.875%, 07/31/96 1900M 1,908,235
US Treasury Note
4.375%, 08/15/96 1110M 1,107,985
US Treasury Note
4.375%, 08/15/96 2045M 2,041,211
<TABLE>
<CAPTION>
- ----------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- ----------------------------------------------
<S> <C> <C>
US Treasury Bill
5%, 08/22/96 5000M $ 4,943,056
US Treasury Note
6.5%, 09/30/96 450M 451,723
US Treasury Note
7%, 09/30/96 1050M 1,055,676
US Treasury Note
8%, 10/15/96 3500M 3,532,539
US Treasury Note
8%, 10/15/96 2000M 2,018,829
US Treasury Note
8%, 10/15/96 3500M 3,533,112
US Treasury Note
6.875%, 10/31/96 5000M 5,029,016
US Treasury Note
7.25%, 11/15/96 5000M 5,040,323
---------------
Total Investments
(Amortized Cost $83,934,549)* 83,934,549
Excess of Other Assets
Over Liabilities 3.7% 3,207,765
---------------
Net Assets $87,142,314
===============
</TABLE>
- ----------------------------------------------
* Also cost for federal income tax purposes.
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
Sentinel U.S. Treasury Money Market Fund
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- -------------------------------------------------------------
<S> <C>
Assets
Investments at value $83,934,549
Cash and cash equivalents 7,771,884
Receivable for interest 507,897
--------------
Total Assets 92,214,330
--------------
Liabilities
Payable for securities purchased 4,989,229
Accrued expenses 36,139
Management fee payable 33,597
Fund service fee payable 13,051
--------------
Total Liabilities 5,072,016
--------------
Net Assets Applicable to Outstanding Shares $87,142,314
==============
Net Asset Value
Class A Shares
$83,244,273 / 83,244,273 shares outstanding $ 1.00
==============
Class B Shares
$3,898,041 / 3,898,041 shares outstanding $ 1.00
==============
Net Assets Represent
Capital stock at par value $ 871,423
Paid-in capital 86,270,891
--------------
Net Assets $87,142,314
==============
Investments at Cost $83,934,549
==============
</TABLE>
See Notes to Financial Statements.
Sentinel U.S. Treasury Money Market Fund
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- -----------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Investment Income
Income:
Interest $2,146,548
--------------
Expenses:
Management advisory fee 164,753
Transfer agent and custodian 107,992
Accounting Services 16,711
Professional fees 10,525
Reports and notices to shareholders 4,218
Directors' fees and expenses 4,839
Other 15,083
--------------
Total Expenses 324,121
Expense Offset (2,266)
--------------
Net Expenses 321,855
--------------
Net Investment Income and Net Increase in
Net Assets from Operations $1,824,693
==============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel U.S. Treasury Money Market Fund
Statement of Changes in Net Assets
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
-------------- --------------
<S> <C> <C>
Increase in Net Assets from Operations
Net Investment income $ 1,824,693 $ 3,783,325
-------------- --------------
Distributions to Shareholders
From net investment income
Class A Shares (1,800,379) (3,783,325)
Class B Shares (24,314) -
-------------- --------------
Total Distributions to Shareholders (1,824,693) (3,783,325)
-------------- --------------
From Capital Share Transactions
Net proceeds from sales of shares
Class A Shares 108,319,414 150,294,331
Class B Shares 4,038,738 -
Net asset value of shares in reinvestment
of dividends and distributions
Class A Shares 1,627,408 3,499,173
Class B Shares 22,103 -
-------------- --------------
114,007,663 153,793,504
Less: Payments for shares reacquired -
Class A Shares (107,366,460) (148,430,713)
Class B Shares (162,800) -
Increase in net assets from capital share -------------- --------------
transactions 6,478,403 5,362,791
-------------- --------------
Total Increase in Net Assets for period 6,478,403 5,362,791
Net Assets: Beginning of period 80,663,911 75,301,120
-------------- --------------
Net Assets: End of period $ 87,142,314 $ 80,663,911
============== ==============
Undistributed Net Investment Income
at End of Period - -
============== ==============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Notes to Financial Statements
(1) Significant Accounting Policies:
Sentinel Group Funds, Inc. (the "Company") is registered under the Investment
Company Act of 1940, as amended, as a diversified open-end management investment
company. The Company consists of eleven separate series - Sentinel Emerging
Growth Fund, Sentinel Growth Fund, Sentinel World Fund, Sentinel Common Stock
Fund, Sentinel Balanced Fund, Sentinel Bond Fund, Sentinel Tax-Free Income Fund,
Sentinel New York Tax-Free Income Fund (a non-diversified series), Sentinel
Government Securities Fund, Sentinel Short-Intermediate Government Fund and
Sentinel U.S. Treasury Money Market Fund, each individually referred to as a
Fund. As a result of the Company merger with seven of the Independence Capital
Group of Funds, as further described in Note (6), Sentinel New York Tax-Free
Income Fund and Sentinel Short-Intermediate Government Fund commenced operations
on March 27, 1995. The Funds initially offered one class of shares now referred
to as Class A Shares. Effective April 1, 1996 Sentinel Emerging Growth, Sentinel
World, Sentinel Common Stock, Sentinel Balanced, Sentinel Bond, Sentinel Tax-
Free Income and Sentinel U.S. Treasury Money Market Funds have a second class of
shares called Class B Shares. The following is a summary of significant
accounting policies followed by the Company.
A. Security Valuation: Equity securities which are traded on a national or
foreign securities exchange and over-the-counter securities listed in the NASDAQ
National Market System are valued at the last reported sales price on the date
of determination. Securities for which no sale was reported on that date are
valued at the mean between the last reported bid and asked prices. Over-the-
counter securities not listed on the NASDAQ National Market System are valued at
the mean of the current bid and asked prices. Fixed income securities are valued
on the basis of valuations provided by independent pricing services. Short-term
securities maturing in 60 days or less are stated at cost plus accrued interest
earned which approximates market value. Portfolio securities of the Sentinel
U.S. Treasury Money Market Fund are valued at amortized cost, which approximates
market value, in accordance with the terms of a rule adopted by the Securities
and Exchange Commission. The amortized cost method values a security at cost on
the date of purchase and thereafter assumes a constant amortization to maturity
of any discount or premium.
B. Securities Transactions and Related Investment Income: Securities
transactions are accounted for on the date the securities are purchased or sold
(trade date). Interest income is recorded on the accrual basis. Cost is
determined, and realized gains and losses are computed, using the identified
cost method. Market discount and original issue discount are accreted to income.
The Sentinel Tax-Free Income Fund, the Sentinel New York Tax-Free Income Fund
and the Sentinel Short-Intermediate Government Fund amortize premium. Sentinel
New York Tax-Free Income Fund invests in debt instruments of municipal issuers
whose ability to meet their obligations may be affected by economic developments
in the State of New York.
C. Dividends and Distributions: Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Income distributions and
capital gain distributions are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for mortgage-backed
securities and foreign currency transactions. Re-classifications were made to
reflect these differences as of May 31, 1996 as follows:
<TABLE>
<CAPTION>
Increase (decrease) in
Increase (decrease) accumulated undistributed
in accumulated net realized gain (loss)
undistributed net on investments and foreign
Fund investment income currency transactions
---------------------------- --------------------- ----------------------------
<S> <C> <C>
World........................ ($72,796) $72,796
Balanced..................... 164 (164)
Bond......................... 173 (173)
Government Sec............... (29,490) 29,490
Short-Intermediate Gov't..... (26,537) 26,537
</TABLE>
D. Dollar Rolls: Sentinel Balanced, Sentinel Bond, Sentinel Government
Securities and Sentinel Short-Intermediate Government Funds enter into dollar
rolls in which the Funds sell securities for delivery in the current month, and
simultaneously contract to repurchase similar (same type, coupon and maturity)
securities on a specified future date. During the roll period the Funds forgo
principal and interest paid on the securities. The Funds are compensated by the
interest earned on the cash proceeds of the initial sale and by the lower
repurchase price at the future date. The difference between the sale proceeds
and the lower repurchase price is taken into income. The Funds maintain
segregated accounts, the dollar value of which is equal to its obligations, in
respect of dollar rolls.
<PAGE>
E. Federal Income Taxes: Each Fund intends to continue to meet the requirements
of the Internal Revenue Code applicable to regulated investment companies. The
Company intends to distribute all of its taxable income to its shareholders,
relieving each Fund of any federal excise tax or income tax liability.
F. Foreign Currency Translations: The books and records of the Sentinel World
Fund are maintained in U.S. dollars. Foreign currency amounts are translated
into U.S. dollars at the mean between the buying and selling rates on the
following basis:
(1) market value of investment securities, assets and liabilities at the closing
daily rate of exchange; and
(2) purchases and sales of investment securities, income and expenses at the
rate of exchange prevailing on the respective dates of such transactions.
The Sentinel World Fund does not isolate that portion of gains and losses on
investments in securities which is due to changes in the foreign exchange rates
from that which is due to changes in market prices of such securities. However,
pursuant to United States federal income tax regulations, gains and losses from
certain foreign currency transactions are treated as ordinary income for federal
income tax purposes.
G. Repurchase Agreements: Each Fund may enter into repurchase agreements as a
means of making short-term investments, of seven days or less, and in aggregate
amounts of not more than 25% of the net assets of a Fund. Each Fund, through its
custodian, takes possession of the securities collateralizing repurchase
agreements. All repurchase agreements entered into by the Funds provide that the
market value of the collateral underlying the repurchase agreement at the time
of purchase, and each subsequent business day, will always be at least equal to
102% of the repurchase agreement amount including accrued interest. If the
seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
H. Other: Direct expenses of a Fund are charged to that Fund while joint
expenses of the Company are allocated proportionately based upon the Funds'
respective average net assets or number of shareholder accounts.
Allocation of expenses not allocated to a specific Class of each Fund shall be
allocated according to the average net assets or number of shareholder accounts,
each on a pro rata basis, of each Class.
Income, gains and losses (realized and unrealized) shall be allocated pro rata
according to average net assets of each Class of each Fund.
Earnings credits are received from the custodian and dividend paying agent on
cash balances and are reflected in the statement of operations as an expense
offset.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
(2) Management Advisory Fee and Other Transactions with Affiliates:
Pursuant to the Investment Advisory Agreement (the "Agreement"), Sentinel
Advisors, Co. ("SAC"), a Vermont general partnership whose general partners are
Sentinel Advisors, Inc., an indirect wholly-owned subsidiary of National Life
Insurance Company ("National Life"), ProvidentMutual Management Co., Inc., an
affiliate of Provident Mutual Life Insurance Company of Philadelphia ("Provident
Mutual"), HTK of Delaware, Inc. ("HTK") an affiliate of The Penn Mutual Life
Insurance Company ("Penn Mutual") and Sentinel Management Company ("SMC"), a
Vermont general partnership whose general partners are affiliates of National
Life, Provident Mutual and Penn Mutual, provides general supervision of the
Funds' investments as well as certain administrative and related services. As
compensation in full for services rendered under its Agreement, the Funds pay
SAC a monthly fee determined as follows: (1) With respect to Sentinel Emerging
Growth, Sentinel Growth, Sentinel World and Sentinel Balanced Funds: 0.70% per
annum on the first $200 million of aggregate average daily net assets of such
Funds; 0.65% per annum on the next $100 million of such assets; 0.60% per annum
on the next $100 million of such assets; and 0.55% per annum on such assets in
excess of $400 million. (2) With respect to Sentinel Common Stock Fund: 0.55%
per annum on the average daily net assets of the Fund. (3) With respect to
Sentinel Bond, Sentinel Tax-Free Income, Sentinel New York Tax-Free Income,
Sentinel Government Securities and Sentinel Short-Intermediate Government Funds:
0.55% per annum on the first $200 million of aggregate average daily net assets
of such Funds; 0.50% per annum on the next $200 million of such assets; and
0.45% per annum on such assets in excess of $400 million. (4) With respect to
Sentinel U.S. Treasury Money Market Fund: 0.40% per annum on the first $300
million of average daily net assets; and 0.35% per annum on such assets in
excess of $300
<PAGE>
million. The Agreement provides that if certain expenses incurred by the Company
in any fiscal year exceed the expense limitations imposed by any state's
securities regulations, SAC will reimburse the Company for any such excess. No
reimbursement was required for the period.
With respect to Sentinel World Fund only, SAC has entered into a sub-advisory
agreement with INVESCO Capital Management, Inc. (the "Sub-Advisor") effective
April 1, 1996. Pursuant to such agreement, the Sub-Advisor provides SAC with a
continuous investment program consistent with Sentinel World Fund's investment
objectives and policies. The sub-advisory agreement provides for a fee to be
paid by SAC to the Sub-Advisor of the greater of (a) a monthly fee equal to
0.375% per annum of the average daily net assets of Sentinel World Fund up to
$500 million and 0.30% per annum of such average net assets in excess of $500
million, or (b) $20,000 per annum. Prior to April 1, 1996 Cashman, Farrell and
Associates acted as sub-advisor.
On March 1, 1993, each of the Funds (except Sentinel U.S. Treasury Money Market
Fund) adopted a distribution plan pursuant to Rule 12b-1 under the 1940 Act.
These distribution plans are herein referred to as the "A Plans". The Sentinel
New York Tax-Free Income Fund became subject to the A Plan upon its inception on
March 27, 1995. On March 24, 1995 the Sentinel Short-Intermediate Government
Fund adopted a supplemental distribution plan pursuant to Rule 12b-1 applicable
only to it. On March 29, 1996 each of the Funds with Class B Shares (except
Sentinel U.S. Treasury Money Market Fund) adopted a Class B distribution plan
referred to as the "B Plans." None of the fees paid by the other Funds pursuant
to the Plans will be used to reimburse Sentinel Financial Services Company
("SFSC"), a Vermont general partnership whose general partners are National Life
Investment Management Company, Inc., a wholly-owned subsidiary of National Life,
ProvidentMutual Financial Services, Inc., an affiliate of Provident Mutual, HTK
and SMC, the principal underwriter ("Distributor") of the Company's shares, for
expenses incurred in connection with the distribution of the Sentinel U.S.
Treasury Money Market Fund shares.
Under the A Plans, each participating Fund pays to the Distributor a monthly fee
at the maximum annual rate of (a) .30% of average daily net assets in the case
of the Sentinel Emerging Growth, Sentinel Growth, Sentinel World, Sentinel
Common Stock and Sentinel Balanced Funds, (b) .20% of average daily net assets
in the case of the Sentinel Bond, Sentinel Tax-Free Income, Sentinel New York
Tax-Free Income and Sentinel Government Securities Funds or (c) .35% of average
daily net assets in the case of the Sentinel Short-Intermediate Government Fund.
Such fees will be used to reimburse the Distributor for expenses incurred in
connection with distribution and promotion of the shares of each participating
Fund, including salaries and expenses of the Distributor's wholesale sales
force, home office management and marketing personnel, expenses incurred by the
Distributor for the occupancy of its office space in Montpelier, Vermont,
expenses incurred by the Distributor with respect to equipment and supplies,
expenses incurred for the preparation, printing and distribution of sales
literature used in connection with the offering of such shares to the public,
expenses incurred in advertising, promotion and selling shares of such Fund to
the public, expenses incurred for the preparation, printing and distribution of
the Prospectus and Statement of Additional Information, any supplement thereto
used in connection with the offering of such Fund's shares to the public, or any
reports and other communications for the distribution to existing shareholders,
and service fees (deferred commissions) paid to securities dealers who have
executed a selling agreement with the Distributor.
Under the B Plans, each participating Fund pays the Distributor a monthly fee at
the maximum annual rate of 1.00% of the average daily net assets. Of such
amount, up to 0.25% shall be allocated to service fees to securities dealers who
have executed a selling agreement with the Distributor, and up to 0.75% may be
allocated to other expenses. Other expenses include recovery of front-end sales
commissions paid by the Distributor with respect to sales of Class B Shares,
together with the cost of financing such payments incurred by the Distributor,
except to the extent such costs are recovered through contingent deferred sales
charges collected by the Distributor. Other expenses also include those
described above for the A Plans.
The Distributor will not be reimbursed for any unreimbursed eligible expenses
from any other Fund, or in any future year from any of the Plans.
SFSC also receives a sales charge added to the net asset value received by the
Company on the sale of its Class A Shares. This compensation is not an expense
of the Company and does not affect its operating results. SFSC has advised the
Company that it received sales charges aggregating $3,233,545 for the six months
ended May 31, 1996. The Company is advised that the total distribution charges
retained by SFSC on the sale of shares amounted to $109,092 after allowances of
$1,770,721 to Equity Services, Inc., an affiliate of National Life, $316,524 to
1717 Capital Management Company, an affiliate of Provident Mutual, $274,081 to
Hornor, Townsend & Kent, Inc. and $223,403 to Janney Montgomery Scott, Inc.,
affiliates of Penn Mutual, and $539,724 to other investment dealers.
<PAGE>
Each director who is not an employee of the adviser or an affiliated company is
paid an annual fee of $16,000 plus $1,500 for each meeting of the Board of
Directors attended. Such directors are reimbursed for travel and other out-of-
pocket expenses incurred in attending such meetings.
Pursuant to the Fund Services Agreement with Sentinel Administrative Service
Company ("SASC"), a Vermont general partnership whose general partners are
Sentinel Administrative Service Corporation ("SAS Corp."), an indirect wholly-
owned subsidiary of National Life, SIGMA American Corp., an affiliate of
Provident Mutual, HTK and SMC, the Company receives fund accounting and
financial administrative services, transfer agent services and investor
services, all of which are coordinated with other services which the Company has
contracted for with outside providers. Total fees for the six months ended May
31, 1996 were $1,702,750.
SASC has voluntarily agreed to refund its fee to the extent necessary to prevent
the overall aggregate expense ratio of the Funds' Class A Shares and Sentinel
Pennsylvania Tax-Free Trust (excluding the Sentinel World Fund) from exceeding
1.30% of average daily net assets in any fiscal year. The Funds and Sentinel
Pennsylvania Tax-Free Trust make up the Sentinel Family of Funds. Although SASC
has no present intention to do so, this arrangement may be terminated at any
time. The Company expenses for the six months ended May 31, 1996 did not exceed
1.30% of its average daily net assets.
With respect to Class A Shares of Sentinel U.S. Treasury Money Market Fund,
Sentinel Short-Intermediate Government Fund and Sentinel World Fund, SASC has
agreed to reimburse the Funds for all operating expenses of the Funds in excess
of an annual rate of .85%, 1.00% and 2.00%, respectively, of the Fund's average
daily net assets. For the six months ended May 31, 1996, the total amount
reimbursable to Sentinel Short-Intermediate Government Fund was $33,281. No
amounts were required to be reimbursed to Sentinel U.S. Treasury Money Market
Fund or Sentinel World Fund for the six months ended May 31, 1996. Although SASC
has no present intention to do so, this arrangement may be terminated at any
time.
(3) Investment Transactions:
(Purchases and sales of investment securities (excluding short-term obligations)
for the six months ended May 31, 1996 were as follows:
<TABLE>
<CAPTION>
Purchases of Sales of
other than Purchases of other than
U.S. U.S. U.S. Sales of U.S.
government government government government
direct and direct and direct and direct and
agency agency agency agency
obligations obligations obligations obligations
- ---------------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Emerg. Growth......... $32,765,988 -- $34,917,240 --
Growth................ 34,358,469 -- 36,016,590 --
World................. 14,307,985 -- 3,281,904 --
Common Stock.......... 101,894,927 -- 123,115,598 --
Balanced.............. 46,597,638 $65,491,743 64,818,837 $54,317,545
Bond.................. 61,728,073 46,944,757 72,187,918 41,621,519
Tax-Free.............. 71,149,205 -- 74,617,121 --
NY Tax-Free........... 1,651,463 -- 1,390,414 --
Government............ -- 356,211,800 -- 357,455,559
Short-Int. Gov't...... -- 38,612,038 -- 28,338,058
</TABLE>
(The Sentinel U.S. Treasury Money Market Fund invests only in short-term
obligations.)
For Federal income tax purposes, the Company has capital loss carryforwards at
November 30, 1995 as follows:
$109,718 and $14,633 (expiring in 2001 and 2002, respectively) for a total of
$124,351 for the Sentinel Balanced Fund, $2,140,898 and $1,295,618 (expiring in
2001 and 2002, respectively) for a total of $3,436,516 for the Sentinel Bond
Fund, $143,804 expiring in 2002 for the Sentinel Tax-Free Income Fund, $4,069
and $47,300 (expiring in 2002 and 2003, respectively) for a total of $51,369 for
the Sentinel New York Tax-Free Income Fund, $3,586,497 expiring in 2002 for the
Sentinel Government Securities Fund and $328,517, $619,379 and $142,166
(expiring in 2000, 2001 and 2002, respectively) for a total of $1,090,062 for
the Sentinel Short-Intermediate Government Fund. During the year ended November
30, 1995, the Sentinel Common Stock Fund, the Sentinel Balanced Fund, the
Sentinel Bond Fund, the Sentinel Tax-Free Income Fund, the Sentinel Government
Securities Fund and the Sentinel Short-Intermediate Government Fund utilized
$671,131, $325,133, $1,983,401, $1,604,746, $4,133,225 and $61,495 of capital
loss carryforwards, respectively. It is unlikely that a capital gains
distribution will be paid to shareholders of these Funds until net gains have
been realized in excess of such capital loss carryforwards or the carryforwards
expire.
<PAGE>
(4) Fund Shares:
At May 31, 1996, 2 billion shares of one cent par value were authorized. There
are 1.34 billion shares allocated to the various Funds with Class A Shares and
.24 billion shares allocated to the various Funds with Class B Shares. Proceeds
from sales and payments for redemptions on Fund shares as shown in the statement
of changes in net assets are represented by the following number of shares:
<TABLE>
<CAPTION>
Shares issued Net
Shares issued in in exchange increase
reinvestment of for net assets of (decrease)
dividends and Shares other investment in shares
Fund Shares sold distributions reacquired companies outstanding
---- ----------- ------------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C>
Six Months Ended 5/31/96
Emerging Growth - A............. 1,410,761 3,479,603 2,740,690 ---- 2,149,674
Emerging Growth - B............. 107,105 ---- 2,016 ---- 105,089
Growth.......................... 274,346 584,386 350,174 ---- 508,558
World - A....................... 1,195,884 47,048 370,579 ---- 872,353
World - B....................... 48,578 ---- ---- ---- 48,578
Common Stock - A................ 1,677,046 2,315,989 1,705,127 ---- 2,287,908
Common Stock - B................ 170,655 ---- 88 ---- 170,567
Balanced - A.................... 1,418,711 613,391 1,567,163 ---- 464,939
Balanced - B.................... 105,896 ---- 782 ---- 105,114
Bond - A........................ 1,731,343 395,036 2,948,170 ---- (821,791)
Bond - B........................ 104,770 560 99 ---- 105,231
Tax-Free - A.................... 530,247 128,891 1,015,815 ---- (356,677)
Tax-Free - B.................... 26,286 85 9 ---- 26,362
NY Tax-Free..................... 47,679 10,235 22,064 ---- 35,850
Government...................... 771,849 242,421 1,390,437 ---- (376,167)
Short-Inter. Gov't.............. 2,088,225 82,229 1,263,679 ---- 906,775
U.S. Treasury - A............... 108,319,414 1,627,408 107,366,460 ---- 2,580,362
U.S. Treasury - B............... 4,038,738 22,103 162,800 ---- 3,898,041
Year Ended 11/30/95
Emerging Growth................. 2,765,224 2,794,856 4,369,276 ---- 1,190,804
Growth.......................... 381,710 530,174 464,496 ---- 447,388
World........................... 1,216,644 61,344 1,110,080 ---- 167,908
Common Stock.................... 2,253,613 1,533,936 5,212,198 1,761,838 337,189
Balanced........................ 2,333,343 564,931 3,386,737 273,807 (214,656)
Bond............................ 3,095,605 800,012 6,008,278 5,126,048 3,013,387
Tax-Free........................ 1,503,210 275,430 2,099,049 343,701 23,292
N.Y. Tax-Free*.................. 86,231 12,949 158,731 514,574 455,023
Government...................... 1,215,813 533,270 2,479,497 ---- (730,414)
Short-Inter.Gov't.*............. 2,233,440 70,060 994,380 1,578,443 2,887,563
U.S. Treasury................... 150,294,330 3,499,174 148,430,713 ---- 5,362,791
</TABLE>
*For the period March 27, 1995 to November 30, 1995.
(5) Post Retirement Benefits:
The Company provides certain health care and life insurance benefits to its
retirees. At May 31, 1996 the projected obligation for such benefits had been
accrued.
(6) Business Combinations:
On March 27, 1995 the following Funds acquired seven funds of The Independence
Capital Group of Funds ("ICG") pursuant to a Plan of Reorganization approved by
ICG shareholders on March 10, 1995. The acquisition was accomplished by a tax-
free exchange, based on respective net asset values, as follows:
<TABLE>
<CAPTION>
Sentinel
ICG Sentinel Value of ICG
Sentinel Merged Shares Shares Shares ICG
Fund Fund Issued Issued Exchanged Value
- ------------------------- ------------------- -------------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Common Stock............. Tot. Ret. Growth 871,123 $25,653,997 2,289,320 $25,653,997
Common Stock............. Opportunities 890,715 26,240,738 2,491,973 26,240,738
-----------
Common Stock Fund Total 51,894,735
----------
Balanced................. Balanced 273,807 4,084,150 426,145 4,084,150
Bond..................... Tot. Ret. Bond 5,126,048 31,075,198 3,219,052 31,075,198
Tax-Free Income.......... Municipal Bond 343,701 4,493,940 415,491 4,493,940
NY Tax-Free Inc.......... NY Municipal Bond 514,574 5,759,369 514,574 5,759,369
Short-Inter. Gov't....... Short-Inter. Gov't. 1,578,443 15,218,556 1,578,443 15,218,556
<CAPTION>
Sentinel ICG Sentinel
ICG ICG Accumulated Value
Sentinel Merged Unrealized Realized before Combined
Fund Fund Appreciation Loss Combination Value
- -------------------------- ------------------- ------------ ------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Common Stock............. Tot. Ret. Growth $3,547,083 $ 0 ----- -----
Common Stock............. Opportunities 2,064,874 (671,131) ----- -----
--------------- -------------
Common Stock Fund Total $898,684,833 $950,579,568
--------------- -------------
Balanced................. Balanced 218,379 (314,647) 239,745,703 243,829,853
Bond..................... Tot. Ret. Bond 532,802 (2,264,261) 84,932,093 116,007,291
Tax-Free Income.......... Municipal Bond 99,091 (18,067) 103,103,137 107,597,077
NY Tax-Free Inc.......... NY Municipal Bond 118,593 (4,069) 0 5,759,369
Short-Inter. Gov't....... Short-Inter. Gov't. 36,677 (1,151,557) 0 15,218,556
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Emerging Growth Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine
Six Months Year Ended Year Ended Months Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93(A)
Class A Shares (Unaudited)
-------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net asset value at beginning of period $ 5.20 $ 5.53 $ 6.87 $ 6.49
Income from Investment Operations
Net investment income (loss) 0.01 0.02 (0.04) (0.06)
Net realized and unrealized gain on investments 0.82 0.56 0.18 0.44
-------------- ----------- ----------- -----------
Total from investment operations 0.83 0.58 0.14 0.38
-------------- ----------- ----------- -----------
Less Distributions
Dividends from net investment income 0.03 - - -
Distributions from realized gains on investments 0.96 0.91 1.48 -
-------------- ----------- ----------- -----------
Total Distributions 0.99 0.91 1.48 -
-------------- ----------- ----------- -----------
Net asset value at end of period $ 5.04 $ 5.20 $ 5.53 $ 6.87
============== =========== =========== ===========
Total Return (%) * 18.9 ++ 12.2 2.0 5.9 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.46 + 1.56 1.58 1.52 +
Ratio of expenses to average net assets before
expense reductions (%) ** 1.49 + 1.60 1.58 1.52 +
Ratio of net investment income to average net assets (%) 0.35 + 0.26 (0.74) (1.01)+
Portfolio turnover rate (%) 43 79 46 61
Average commission rate paid per share $ 0.054 N/A N/A N/A
Net assets at end of period (000 omitted) $97,462 $89,321 $88,420 $105,176
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Two Months
Ended 5/31/96(B)
Class B Shares (Unaudited)
---------------
<S> <C>
Net asset value at beginning of period $ 4.82
---------------
Income from Investment Operations
Net investment income -
Net realized and unrealized gain on investments 0.20
---------------
Total from investment operations 0.20
---------------
Less Distributions
Dividends from net investment income -
Distributions from realized gains on investments -
---------------
Total Distributions -
---------------
Net asset value at end of period $ 5.02
===============
Total Return (%) * 4.1 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 2.26 +
Ratio of expenses to average net assets before
expense reductions (%) ** 2.29 +
Ratio of net investment income to average net assets (%) (0.62)+
Portfolio turnover rate (%) 43
Average commission rate paid per share $ 0.054
Net assets at end of period (000 omitted) $ 528
</TABLE>
(A) Commenced operations March 1, 1993.
(B) Commenced operations April 1, 1996.
+ Annualized
++ Not Annualized
* Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
** Expense reductions are comprised of the voluntary expense reimbursements
and include, effective 1995, the earnings credits as described in
Notes (2) and (1) H.
N/A Not applicable to periods prior to 1996.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Growth Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
(Unaudited)
--------- --------- --------- --------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 16.93 $ 16.15 $ 17.51 $ 18.56 $ 15.99 $ 14.06
Income from Investment Operations
Net investment income 0.03 0.07 0.05 0.04 0.11 0.20
Net realized and unrealized gain (loss) on
investments 1.84 3.33 (0.92) (0.28) 3.07 1.93
--------- ------- ------- ------- ------- -------
Total from investment operations 1.87 3.40 (0.87) (0.24) 3.18 2.13
--------- ------- ------- ------- ------- -------
Less Distributions
Dividends from net investment income 0.07 0.05 0.03 0.04 0.16 0.20
Distributions from realized gains on investments 2.55 2.57 0.46 0.77 0.45 -
--------- ------- ------- ------- ------- -------
Total Distributions 2.62 2.62 0.49 0.81 0.61 0.20
Net asset value at end of period $ 16.18 $ 16.93 $ 16.15 $ 17.51 $ 18.56 $ 15.99
========= ======= ======= ======= ======= =======
Total Return (%) * 12.9 ++ 24.9 (5.1) (1.3) 20.5 15.2
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.46 + 1.50 1.43 1.31 1.05 1.08
Ratio of expenses to average net assets before
expense reductions (%) ** 1.49 + 1.54 1.43 1.31 1.05 1.08
Ratio of net investment income to average net assets
(%) 0.40 + 0.42 0.30 0.22 0.63 1.22
Portfolio turnover rate (%) 57 84 58 12 28 25
Average commission rate paid per share $ 0.056 N/A N/A N/A N/A N/A
Net assets at end of period (000 omitted) $ 66,016 $ 60,446 $ 50,447 $ 57,833 $ 63,664 $55,598
</TABLE>
+ Annualized
++ Not Annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
** Expense reductions are comprised of the voluntary expense reimbursements
and include, effective 1995, the earning credits as described in Notes
(2) and (1) H.
N/A Not applicable to periods prior to 1996.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel World Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine
Six Months Year Ended Year Ended Months Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93(A)
Class A Shares (Unaudited)
---------- --------- --------- ----------
<S> <C> <C> <C> <C>
Net asset value at beginning of period $ 13.78 $ 12.74 $ 11.86 $ 9.56
---------- --------- --------- ----------
Income from Investment Operations
Net investment income 0.10 0.14 0.08 0.02
Net realized and unrealized gain on investments 1.24 1.14 0.89 2.28
---------- --------- --------- ----------
Total from investment operations 1.34 1.28 0.97 2.30
---------- --------- --------- ----------
Less Distributions
Dividends from net investment income 0.13 0.09 0.03 -
Distributions from realized gains on investments 0.07 0.15 0.06 -
---------- --------- --------- ----------
Total Distributions 0.20 0.24 0.09 -
---------- --------- --------- ----------
Net asset value at end of period $ 14.92 $ 13.78 $ 12.74 $ 11.86
========== ========= ========= ==========
Total Return (%) ** 9.8 ++ 10.2 8.2 24.1 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.49 + 1.56 1.58 2.00 +
Ratio of expenses to average net assets before
expense reductions (%) *** 1.54 + 1.63 1.58 2.12 +
Ratio of net investment income to average net assets (%) 1.47 + 0.79 0.62 .41 +*
Portfolio turnover rate (%) 6 32 30 66
Average commission rate paid per share $ 0.049 N/A N/A N/A
Net assets at end of period (000 omitted) $ 64,652 $ 47,702 $41,970 $16,872
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Two Months
Ended 5/31/96(B)
Class B Shares (Unaudited)
--------------
<S> <C>
Net asset value at beginning of period $ 14.49
--------------
Income from Investment Operations
Net investment income 0.02
Net realized and unrealized gain on investments 0.38
--------------
Total from investment operations 0.40
--------------
Less Distributions
Dividends from net investment income -
Distributions from realized gains on investments -
--------------
Total Distributions -
--------------
Net asset value at end of period $ 14.89
==============
Total Return (%) ** 2.8 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 2.16 +
Ratio of expenses to average net assets before
expense reductions (%) *** 2.21 +
Ratio of net investment income to average net assets (%) 3.07 +
Portfolio turnover rate (%) 6
Average commission rate paid per share $ 0.049
Net assets at end of period (000 omitted) $ 723
</TABLE>
(A) Commenced operations March 1, 1993.
(B) Commenced operations April 1, 1996.
+ Annualized
++ Not Annualized
* Ratio of net investment income to average net assets would have been
.29% in 1993, in the absence of a voluntary expense reimbursement.
** Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge is not
reflected in the calculation of total return.
*** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995, the earning credits as
described in Notes (2) and (1) H.
N/A Not Applicable to periods prior to 1996.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Common Stock Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
Class A Shares (Unaudited)
-------------- ----------- ----------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 35.21 $ 28.25 $ 29.63 $ 29.71 $ 26.78 $ 23.61
-------------- ----------- ----------- ---------- ---------- ----------
Income from Investment Operations
Net investment income 0.31 0.72 0.83 0.79 0.90 0.90
Net realized and unrealized gain (loss)
on investments 3.49 8.09 (1.35) 1.66 3.44 3.90
-------------- ----------- ----------- ---------- ---------- ----------
Total from investment operations 3.80 8.81 (0.52) 2.45 4.34 4.80
-------------- ----------- ----------- ---------- ---------- ----------
Less Distributions
Dividends from net investment income 0.32 0.74 0.80 0.82 0.91 0.93
Distributions from realized gains on
investments 2.77 1.11 0.06 1.71 0.50 0.70
-------------- ----------- ----------- ---------- ---------- ----------
Total Distributions 3.09 1.85 0.86 2.53 1.41 1.63
-------------- ----------- ----------- ---------- ---------- ----------
Net asset value at end of period $ 35.92 $ 35.21 $ 28.25 $ 29.63 $ 29.71 $ 26.78
============== =========== =========== ========== ========== ==========
Total Return (%) * 11.6 ++ 32.8 (1.8) 8.8 16.7 21.1
Ratios/Supplemental Data
Ratio of net expenses to average net
assets (%) 1.08 + 1.09 1.02 0.93 0.72 0.74
Ratio of expenses to average net assets
before expense reductions (%)** 1.09 + 1.10 1.02 0.93 0.72 0.74
Ratio of net investment income to
average net assets (%) 1.78 + 2.29 2.82 2.68 3.13 3.41
Portfolio turnover rate (%) 10 22 15 9 5 9
Average commission rate paid per share $ 0.058 N/A N/A N/A N/A N/A
Net assets at end of period (000 omitted) $1,161,478 $1,057,944 $ 839,335 $ 897,836 $688,309 $620,179
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Two Months
Ended 5/31/96(A)
Class B Shares (Unaudited
---------------
<S> <C>
Net asset value at beginning of period $35.43
Income from Investment Operations
Net investment income 0.06
Net realized and unrealized gain on
investments 0.39
---------------
Total from investment operations 0.45
---------------
Less Distributions
Dividends from net investment income -
Distributions from realized gains on
investments -
---------------
Total Distributions -
---------------
Net asset value at end of period $35.88
===============
Total Return (%) * 1.3 ++
Ratios/Supplemental Data
Ratio of net expenses to average net
assets (%) 1.90 +
Ratio of expenses to average net assets
before expense reductions (%)** 1.91 +
Ratio of net investment income to
average net assets (%) 2.22 +
Portfolio turnover rate (%) 10
Average commission rate paid per share $0.058
Net assets at end of period (000 omitted) $6,120
</TABLE>
(A) Commenced operations April 1, 1996.
+ Annualized
++ Not annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge is not
reflected in the calculation of total return.
** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995, the earning credits as
described in Notes (2) and (1) H.
N/A Not applicable to periods prior to 1996.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Balanced Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
Class A Shares (Unaudited)
--------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 16.84 $ 14.08 $ 15.27 $ 14.82 $ 13.89 $ 12.58
--------- --------- --------- --------- --------- --------
Income from Investment Operations
Net investment income 0.27 0.58 0.58 0.59 0.70 0.77
Net realized and unrealized gain (loss) on
investments 0.72 2.78 (1.12) 0.80 0.97 1.37
--------- --------- --------- --------- --------- --------
Total from investment operations 0.99 3.36 (0.54) 1.39 1.67 2.14
--------- --------- --------- --------- --------- --------
Less Distributions
Dividends from net investment income 0.27 0.59 0.56 0.58 0.71 0.78
Distributions from realized gains on investments 0.41 0.01 0.09 0.36 0.03 0.05
--------- --------- --------- --------- --------- --------
Total Distributions 0.68 0.60 0.65 0.94 0.74 0.83
--------- --------- --------- --------- --------- --------
Net asset value at end of period $ 17.15 $ 16.84 $ 14.08 $ 15.27 $ 14.82 $ 13.89
========= ========= ========= ========= ========= ========
Total Return (%) * 6.1 ++ 24.4 (3.6) 9.7 12.4 17.5
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.24 + 1.27 1.21 1.14 0.81 0.85
Ratio of expenses to average net assets before
expense reductions (%) ** 1.26 + 1.29 1.21 1.14 0.81 0.85
Ratio of net investment income to average net
assets (%) 3.20 + 3.77 3.97 3.88 4.86 5.70
Portfolio turnover rate (%) 45 110 66 72 38 32
Average commission rate paid per share $ 0.060 N/A N/A N/A N/A N/A
Net assets at end of period (000 omitted) $ 279,972 $ 267,103 $ 226,328 $ 229,632 $120,700 $90,580
--------- --------- --------- --------- --------- --------
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Two Months
Ended 5/31/96(A)
Class B Shares (Unaudited
---------------
<S> <C>
Net asset value at beginning of period $ 17.09
---------------
Income from Investment Operations
Net investment income 0.05
Net realized and unrealized loss on investments (0.02)
---------------
Total from investment operations 0.03
---------------
Less Distributions
Dividends from net investment income -
Distributions from realized gains on investments -
---------------
Total Distributions -
---------------
Net asset value at end of period $ 17.12
==============
Total Return (%) * 0.2 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.98 +
Ratio of expenses to average net assets before
expense reductions (%)** 2.00 +
Ratio of net investment income to average net
assets (%) 3.59 +
Portfolio turnover rate (%) 45
Average commission rate paid per share $ 0.060
Net assets at end of period (000 omitted) $ 1,799
</TABLE>
See Notes to Financial Statements.
(A) Commenced operations April 1, 1996.
+ Annualized
++ Not annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995,the earning credits as
described in Notes (2) and (1) H.
N/A Not applicable to periods prior to 1996.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Bond Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
Class A Shares (Unaudited)
----------- ---------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 6.49 $ 5.85 $ 6.90 $ 6.56 $ 6.43 $ 6.03
----------- ---------- --------- --------- --------- ---------
Income from Investment Operations
Net investment income 0.21 0.42 0.39 0.41 0.46 0.50
Net realized and unrealized gain (loss) on
investments (0.34) 0.64 (0.70) 0.46 0.13 0.40
----------- ---------- --------- --------- --------- ---------
Total from investment operations (0.13) 1.06 (0.31) 0.87 0.59 0.90
----------- ---------- --------- --------- --------- ---------
Less Distributions
Dividends from net investment income 0.21 0.42 0.39 0.41 0.46 0.50
Distributions from realized gains on investments - - 0.35 0.12 - -
----------- ---------- --------- --------- --------- ---------
Total Distributions 0.21 0.42 0.74 0.53 0.46 0.50
----------- ---------- --------- --------- --------- ---------
Net asset value at end of period $ 6.15 $ 6.49 $ 5.85 $ 6.90 $ 6.56 $ 6.43
=========== ========== ========= ========= ========= =========
Total Return (%) * (2.0)++ 18.8 (4.9) 13.7 9.5 15.6
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 0.97+ 0.99 0.98 0.92 0.78 0.81
Ratio of expenses to average net assets before
expense reductions (%) ** 0.99+ 1.03 0.98 0.92 0.78 0.81
Ratio of net investment income to average net
assets (%) 6.60+ 6.81 6.34 5.98 7.03 8.06
Portfolio turnover rate (%) 107 237 133 147 83 77
Net assets at end of period (000 omitted) $ 98,116 $ 108,755 $ 80,487 $ 83,387 $58,106 $43,447
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Two Months
Ended 5/31/96(A)
Class B Shares (Unaudited
---------------
<S> <C>
Net asset value at beginning of period $ 6.30
---------------
Income from Investment Operations
Net investment income 0.05
Net realized and unrealized loss on investments (0.14)
---------------
Total from investment operations (0.09)
---------------
Less Distributions
Dividends from net investment income 0.05
Distributions from realized gains on investments -
---------------
Total Distributions 0.05
Net asset value at end of period $ 6.16
===============
Total Return (%) * (1.4)++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.81+
Ratio of expenses to average net assets before
expense reductions (%) ** 1.83+
Ratio of net investment income to average net assets (%) 5.96+
Portfolio turnover rate (%) 107
Net assets at end of period (000 omitted) $ 648
</TABLE>
(A) Commenced operations April 1, 1996.
+ Annualized
++ Not annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge is not
reflected in the calculation of total return.
** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995, the earning credits as
described in Notes (2) and (1) H.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Tax-Free Income Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
Class A Shares (Unaudited)
---------- --------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at
beginning of period $ 13.62 $ 12.35 $ 13.81 $ 13.13 $ 12.68 $ 12.26
---------- --------- ---------- ---------- ---------- ---------
Income from Investment
Operations
Net investment income 0.33 0.67 0.68 0.73 0.76 0.79
Net realized and
unrealized gain (loss) on
investments (0.54) 1.27 (1.34) 0.79 0.47 0.42
---------- --------- ---------- ---------- ---------- ---------
Total from investment
operations (0.21) 1.94 (0.66) 1.52 1.23 1.21
---------- --------- ---------- ---------- ---------- ---------
Less Distributions
Dividends from net
investment income 0.33 0.67 0.68 0.73 0.76 0.79
Distributions from
realized gains on
investments - - 0.12 0.11 0.02 -
---------- --------- ---------- ---------- ---------- ---------
Total Distributions 0.33 0.67 0.80 0.84 0.78 0.79
---------- --------- ---------- ---------- ---------- ---------
Net asset value at end of
period $ 13.08 $ 13.62 $ 12.35 $ 13.81 $ 13.13 $ 12.68
========== ========= ========== ========== ========== =========
Total Return (%) ** (1.6) ++ 16.0 (5.1) 11.9 10.0 10.2
Ratios/Supplemental Data
Ratio of net expenses to
average net assets (%) 0.96 + 0.90 0.75 0.64 0.50 0.38
Ratio of expenses to
average net assets before
expense reductions (%) *** 1.00 + 0.99 0.94 0.90 0.72 0.73
Ratio of net investment
income to average net
assets (%) 4.88 + 5.06 * 5.11 * 5.41 * 5.93 * 6.37 *
Portfolio turnover rate (%) 67 112 92 39 48 29
Net assets at end of
period (000 omitted) $ 101,508 $ 110,506 $99,935 $ 111,968 $ 55,538 $ 35,277
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Two Months
Ended 5/31/96(A)
Class B Shares (Unaudited
-------------
<S> <C>
Net asset value at beginning of period $13.28
-------------
Income from Investment Operations
Net investment income 0.09
Net realized and unrealized loss on investments (0.19)
-------------
Total from investment operations (0.10)
-------------
Less Distributions
Dividends from net investment income 0.09
Distributions from realized gains on investments -
-------------
Total Distributions 0.09
-------------
Net asset value at end of period $13.09
=============
Total Return (%) ** (0.8) ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.74 +
Ratio of expenses to average net assets before
expense reductions (%)*** 1.78 +
Ratio of net investment income to average net assets (%) 4.19 +
Portfolio turnover rate (%) 67
Net assets at end of period (000 omitted) $ 345
</TABLE>
See Notes to Financial Statements.
(A) Commenced operations April 1, 1996.
+ Annualized
++ Not annualized
* Ratio of net investment income to average net assets would have been
5.00% in 1995, 4.92% in 1994, 5.14% in 1993, 5.71% in 1992, and 6.02%
in 1991, in the absence of a voluntary expense reimbursement.
** Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge is not
reflected in the calculation of total return.
*** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995, the earning credits as
described in Notes (2) and (1) H.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel New York Tax-Free Income Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Eight Months
Six Months Ended
Ended 5/31/96 11/30/95(A)
(Unaudited)
----------- ------------
<S> <C> <C>
Net asset value at beginning of period $11.72 $11.19
----------- ------------
Income from Investment Operations
Net investment income 0.26 0.36
Net realized and unrealized gain (loss) on
investments (0.47) 0.53
----------- ------------
Total from investment operations (0.21) 0.89
----------- ------------
Less Distributions
Dividends from net investment income 0.26 0.36
Distributions from realized gains on investments - -
----------- ------------
Total Distributions 0.26 0.36
----------- ------------
Net asset value at end of period $11.25 $11.72
=========== ============
Total Return (%) * (1.8) ++ 8.1 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.13 + 1.22 +
Ratio of expenses to average net assets before
expense reductions (%) ** 1.19 + 1.29 +
Ratio of net investment income to average net
assets (%) 4.59 + 4.60 +
Portfolio turnover rate (%) 28 32
Net assets at end of period (000 omitted) $5,522 $5,332
</TABLE>
(A) Commenced operations March 27, 1995.
+ Annualized
++ Not annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
** Expense reductions are comprised of the voluntary expense reimbursements
and include, effective 1995, the earning credits as described in Note
(2) and (1) H
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Government Securities Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year Ended Year Ended Year Ended Year Ended Year Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93 11/30/92 11/30/91
(Unaudited)
------------- ---------- ---------- ---------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 10.30 $ 9.31 $ 10.45 $ 10.18 $ 10.04 $ 9.54
------------- ---------- ---------- ---------- ---------- --------
Income from Investment Operations
Net investment income 0.30 0.63 0.59 0.62 0.70 0.74
Net realized and unrealized gain (loss) on
investments (0.56) 0.99 (1.04) 0.42 0.14 0.50
------------- ---------- ---------- ---------- ---------- --------
Total from investment operations (0.26) 1.62 (0.45) 1.04 0.84 1.24
------------- ---------- ---------- ---------- ---------- --------
Less Distributions
Dividends from net investment income 0.30 0.63 0.58 0.60 0.70 0.74
Distributions from realized gains on
investments - - 0.11 0.17 - -
------------- ---------- ---------- ---------- ---------- --------
Total Distributions 0.30 0.63 0.69 0.77 0.70 0.74
------------- ---------- ---------- ---------- ---------- --------
Net asset value at end of period $ 9.74 $ 10.30 $ 9.31 $ 10.45 $ 10.18 $ 10.04
============= ========== ========== ========== ========== ========
Total Return (%) * (2.5) ++ 17.9 (4.5) 10.6 8.6 13.5
Ratios/Supplemental Data
Ratio of net expenses to average net assets
(%) 1.01 + 1.03 1.00 0.98 0.76 0.77
Ratio of expenses to average net assets before
expense reductions (%) ** 1.04 + 1.04 1.00 0.98 0.76 0.77
Ratio of net investment income to average net
assets (%) 6.06 + 6.50 5.95 6.06 6.90 7.52
Portfolio turnover rate (%) 357 367 149 97 79 14
Net assets at end of period (000 omitted) $ 98,477 $ 108,100 $ 104,457 $ 134,749 $68,293 $45,734
</TABLE>
+ Annualized
++ Not annualized
* Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a
redemption on the last day of the period. Initial sales charge is not
reflected in the calculation of total return.
** Expense reductions are comprised of the voluntary expense
reimbursements and include, effective 1995, the earning credits as
described in Notes (2) and (1)H.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel Short-Intermediate Government Securities Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Eight Months
Six Months Ended
Ended 5/31/96 11/30/95(A)
(Unaudited)
------------- -----------
<S> <C> <C>
Net asset value at beginning of period $ 9.84 $ 9.64
------------- -----------
Income from Investment Operations
Net investment income 0.28 0.40
Net realized and unrealized gain (loss) on
investments (0.19) 0.20
------------- -----------
Total from investment operations 0.09 0.60
------------- -----------
Less Distributions
Dividends from net investment income 0.28 0.40
Distributions from realized gains on
investments - -
------------- -----------
Total Distributions 0.28 0.40
------------- -----------
Net asset value at end of period $ 9.65 $ 9.84
============= ===========
Total Return (%) ** 0.9 ++ 6.3 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 1.00 + 1.00 +
Ratio of expenses to average net assets before
expense reductions (%) *** 1.24 + 1.38 +
Ratio of net investment income to average net
assets (%) 5.94 +* 6.07 +*
Portfolio turnover rate (%) 85 58
Net assets at end of period (000 omitted) $36,608 $28,417
</TABLE>
(A) Commenced operations March 27, 1995.
+ Annualized
++ Not annualized
* Ratio of net investment income to average net assets would have been
5.74% in 1996, and 5.76% in 1995, in the absence of a voluntary expense
reimbursement.
** Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
*** Expense reductions are comprised of the voluntary expense reimbursements
and include, effective 1995, the earning credits as described in Notes
(2) and (1) H.
See Notes to Financial Statements.
<PAGE>
- --------------------------------------------------------------------------------
Sentinel U.S. Treasury Money Market Fund
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine
Six Months Year Ended Year Ended Months Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93(A)
Class A Shares (Unaudited)
------------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------- ---------- ---------- -------------
Income from Investment Operations
Net investment income 0.02 0.05 0.03 0.02
Net realized and unrealized gain (loss) on investments - - - -
------------- ---------- ---------- -------------
Total from investment operations 0.02 0.05 0.03 0.02
------------- ---------- ---------- -------------
Less Distributions
Dividends from net investment income 0.02 0.05 0.03 0.02
Distributions from realized gains on investments - - - -
------------- ---------- ---------- -------------
Total Distributions 0.02 0.05 0.03 0.02
------------- ---------- ---------- -------------
Net asset value at end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00
============= ========== ========== =============
Total Return (%) ** 2.3 ++ 5.0 3.1 1.7 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 0.78 + 0.81 0.81 .85 +
Ratio of expenses to average net assets before
expense reductions (%) *** 0.79 + 0.82 0.81 .87 +
Ratio of net investment income to average net assets (%) 4.44 + 4.83 3.01 2.20 +*
Net assets at end of period (000 omitted) $83,244 $80,664 $75,301 $72,252
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Two Months
Ended 5/31/96(B)
Class B Shares (Unaudited)
---------------
Net asset value at beginning of period $ 1.00
---------------
Income from Investment Operations
Net investment income 0.01
Net realized and unrealized gain (loss) on investments -
---------------
Total from investment operations 0.01
---------------
Less Distributions
Dividends from net investment income 0.01
Distributions from realized gains on investments -
---------------
0.01
Net asset value at end of period $ 1.00
===============
Total Return (%) ** 0.7 ++
Ratios/Supplemental Data
Ratio of net expenses to average net assets (%) 0.83 +
Ratio of expenses to average net assets before
expense reductions (%)*** 0.84 +
Ratio of net investment income to average net assets (%) 4.30 +
Net assets at end of period (000 omitted) $ 3,898
</TABLE>
See Notes to Financial Statements.
(A) Commenced operations March 1, 1993.
(B) Commenced operations April 1, 1996.
+ Annualized
++ Not annualized
* Ratio of net investment income to average net assets would have been
2.18% in 1993, in the absence of a voluntary expense reimbursement.
** Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption
on the last day of the period. Initial sales charge is not reflected in
the calculation of total return.
*** Expense reductions are comprised of the voluntary expense reimbursements
and include, effective 1995, the earning credits as described in Notes
(2) and (1) H.
<PAGE>
Sentinel Pennsylvania Tax-Free Trust
Investment in Securities
at May 31, 1996 (Unaudited)
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Principal Amount Value
(M=$1,000) (Note 1)
- --------------------------------------------------------------------------------
<S> <C> <C>
Bonds 90.5%
Pennsylvania 70.0%
Allegheny County Higher
Educ. Bldg.
5.00%, 03/01/16 (AMBAC) 1000M $ 894,700
Allegheny County G/O
5.375%, 06/01/13 (FGIC) 1175M 1,114,194
Allegheny County Hospital
6.00%, 10/01/03 (FGIC) 1000M 1,051,220
Allegheny County
Institution G/O
7.30%, 04/01/09 (MBIA) 1000M 1,078,300
Armstrong County Hospital
Auth.
6.25%, 06/01/13 (AMBAC) 1200M 1,231,812
Beaver County Industrial
Dev. Auth.
7.75%, 09/01/24 500M 527,240
Berks County G/O
7.25%, 11/15/20 (FGIC) 1000M 1,117,440
Delaware County Coll
Rev. Auth.
7.375%, 11/15/20 (MBIA) 500M 561,200
Erie Higher Educ. Building Auth.
7.85%, 09/15/19 500M 550,465
Lehigh County General Purpose
7.25%, 01/01/10 (FGIC) 1000M 1,066,210
Lehigh County Industrial
Dev. Auth.
6.40%, 11/01/21 (MBIA) 1000M 1,028,020
Montgomery County Higher
Educ. & Health
8.30%, 06/01/10 500M 571,115
Pennsylvania Higher Educ. Facs.
6.00%, 01/01/06 1500M 1,575,660
7.20%, 07/01/19 (MBIA) 1000M 1,088,030
Pennsylvania Housing Finance Agency
8.00%, 04/01/16 1000M 1,029,920
Pennsylvania Intergovernmental
CO-OP Auth.
5.75%, 06/15/15 (MBIA) 1000M 971,830
Pennsylvania State G/O
6.25%, 07/01/11 1500M 1,603,035
Pennsylvania State Industrial
Dev. Auth.
5.80%, 07/01/09 (AMBAC) 1000M 1,017,380
Pennsylvania State
Turnpike Commn.
7.20%, 12/01/17 (FGIC) 1000M 1,130,010
Pennsylvania Trafford
School Dist.
5.90%, 05/01/11 (MBIA) 1000M 1,011,250
Philadephia Municipal Auth.
7.80%, 04/01/18 (FGIC) 45M 48,602
Philadephia Regional Port. Auth.
7.125%, 08/01/10 (MBIA) 250M 272,623
7.15%, 08/01/20 (MBIA) 250M 272,855
Philadelphia Water & Waste
7.50%, 08/01/10 500M 568,795
6.25%, 08/01/11 (MBIA) 1000M 1,053,140
6.25%, 08/01/12 (MBIA) 500M 527,110
Scranton Lackawanna
Health & Welfare
7.875%, 07/01/10 (MBIA) 500M 534,710
Westmoreland Cnty
Municipal Auth.
0.00%, 08/15/18 (FGIC) 500M 131,760
------------
23,628,626
------------
Puerto Rico 20.5%
Puerto Rico Public Buildings Auth.
5.70%, 07/01/09 1000M 991,770
5.50%, 07/01/21
Cmwlth GTD 1500M 1,377,885
Puerto Rico Commonwealth
Aqeuduct & Sewer
6.00%, 07/01/09
Cmwlth GTD 500M 515,525
5.00%, 07/01/15
Cmwlth GTD 1000M 875,930
Puerto Rico Commonwealth
Hwy & Transport
5.50%, 07/01/13 (FSA) 1000M 986,880
5.50%, 07/01/36 1250M 1,134,600
Puerto Rico Electric Power Auth.
6.125%, 07/01/09 1000M 1,045,320
------------
6,927,910
------------
Total Bonds
(Cost $29,495,267) 30,556,536
------------
Short-Term Investments 5.0%
Compass Capital PA Municipal
Money Market Fund
(Cost $1,675,000) 1675M 1,675,000
------------
Total Investments
(Cost $31,170,267)* 32,231,536
Excess of Other Assets
Over Liabilities 4.5% 1,534,965
------------
Net Assets $33,766,501
============
</TABLE>
* Also cost for federal income tax purposes.
At May 31, 1996, net unrealized appreciation for federal income tax purposes
aggregated $1,061,269 of which $1,292,809 related to appreciated securities
and $231,540 related to depreciated securities.
The following abbreviations are used in portforio descriptions:
(AMBAC) - Guaranteed by American Municipal Bond Association Corp.
(FGIC) - Guaranteed by Financial Guaranty Insurance Co.
(FSA) - Guaranteed by Financial Security Assurance Co.
(MBIA) - Guaranteed by Municipal Bond Investors Assurance Corp.
G/O - General Obligation Bond
See Notes to Financial Statements.
<PAGE>
Sentinel Pennsylvania Tax-Free Trust
Statement of Assets and Liabilities
at May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Assets
Investments at value $32,231,536
Cash and cash equivalents 851,780
Receivable for interest 618,815
Receivable from fund administrator 109,654
-------------
Total Assets 33,811,785
-------------
Liabilities
Accrued expenses 9,781
Management fee payable 15,775
Distribution fee payable 9,645
Fund service fee payable 10,083
-------------
Total Liabilities 45,284
-------------
Net Assets Applicable to Outstanding Shares $33,766,501
=============
Net Asset Value and Offering Price per Share
$33,766,501 / 2,631,393 shares outstanding $ 12.83
Sales Charge -- 4.00% of Offering Price 0.53
-------------
Maximum Offering Price Per Share $ 13.36
=============
Net Assets Represent
No par value shares of benefical interest;
authorized - unlimited shares
Paid-in-capital $32,569,024
Accumulated undistributed income 1,032
Accumulated undistributed net realized gain
on investments 135,176
Unrealized appreciation of investments 1,061,269
-------------
Net Assets $33,766,501
=============
Investments at Cost $31,170,267
=============
<CAPTION>
Sentinel Pennsylvania Tax-Free Trust
Statement of Operations
For the Six Months Ended May 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
Investment Income
Income:
Interest $ 989,840
-------------
Expenses:
Management advisory fee 94,706
Transfer agent and custodian 30,555
Distribution expense 34,445
Accounting Services 42,000
Professional fees 25,100
Reports and notices to shareholders 2,160
Directors' fees and expenses 11,628
Other 5,461
-------------
Total Expenses 246,055
Expense Reimbursement (109,654)
Expense Offset (7,055)
-------------
Net Expenses 129,346
-------------
Net Investment Income 860,494
-------------
Realized and Unrealized Gain (Loss) on Investments
Net realized gain on sales of investments 135,167
Net change in unrealized appreciation (1,400,001)
-------------
Net Realized and Unrealized Loss on Investments (1,264,834)
-------------
Net Decrease in Net Assets from Operations $ (404,340)
=============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Sentinel Pennsylvania Tax-Free Trust
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
(Unaudited)
------------ ------------
<S> <C> <C>
Increase (Decrease) in Net Assets from Operations
Net Investment income $ 860,494 $ 1,701,100
Net realized gain on sales of investments 135,167 722,772
Net change in unrealized appreciation (1,400,001) 2,109,486
------------ ------------
Net increase (decrease) in net assets from
operations (404,340) 4,533,358
------------ ------------
Distributions to Shareholders
From net investment income (862,292) (1,698,270)
From realized gain on sale of investments (208,641) -
------------ ------------
Total distributions to shareholders (1,070,933) (1,698,270)
------------ ------------
From Capital Share Transactions
Net proceeds from sales of shares 1,565,730 3,128,263
Net asset value of shares in reinvestment
of dividends and distributions 655,803 1,157,477
------------ ------------
2,221,533 4,285,740
Less: Payments for shares reacquired (1,954,856) (3,317,531)
------------ ------------
Increase in net assets from capital share
transactions 266,677 968,209
------------ ------------
Total Increase in Net Assets for period (1,208,596) 3,803,297
Net Assets: Beginning of period 34,975,097 31,171,800
------------ ------------
Net Assets: End of period $33,766,501 $34,975,097
============ ============
Undistributed Net Investment Income
at End of Period $ 1,032 $ 2,830
============ ============
</TABLE>
See Notes to Financial Statements.
<PAGE>
Notes to Financial Statements
(1) Significant Accounting Policies:
Sentinel Pennsylvania Tax-Free Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, as a non-diversified, open-end
management investment company. The following is a summary of significant
accounting policies followed by the Trust.
A. Security Valuation: Investments in securities are valued on the basis of
valuations provided by an independent pricing organization. The independent
pricing organization values the investments, taking into consideration
characteristics of the securities, values of similar securities that trade on a
regular basis, and other relevant market data. Short-term tax-free notes are
stated at cost, which approximates market value.
B. Securities Transactions and Related Investment Income: Securities
transactions are accounted for on the date the securities are purchased or sold
(trade date). Interest income is recorded on the accrual basis and premiums are
amortized. Cost of investments sold is determined on the basis of identified
cost for both financial reporting and income tax purposes. The Trust invests in
debt instruments of municipal issuers whose ability to meet their obligations
may be affected by economic developments in the State of Pennsylvania.
C. Federal Income Taxes: It is the Trust's policy to continue to meet the
requirements of the Internal Revenue Code applicable to regulated investment
companies. The Trust intends to distribute all of its taxable income to its
shareholders; therefore, no federal excise tax or income tax provision is
required.
D. Other: Earnings credits are received from the custodian and dividend paying
agent on cash balances and are reflected in the statement of operations as an
expense credit.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
(2) Distributions:
Realized gains from securities transactions, if any, will be distributed to
shareholders prior to the end of each calendar year. At November 30, 1995 the
Trust did not have any capital loss carryforwards for Federal income tax
purposes. During the year ended November 30, 1995, the Trust utilized $514,122
of capital loss carryforwards.
Dividends from net investment income are declared and paid monthly and recorded
on the ex-dividend date. Income distributions and capital gain distributions are
determined in accordance with federal income tax regulations.
(3) Trust Shares:
Transactions in Trust shares were as follows:
<TABLE>
<CAPTION>
Six Months Year
Ended Ended
5/31/96 11/30/95
----------- -----------
<S> <C> <C>
Shares sold 111,694 241,675
Shares issued to stockholders in reinvestment
of dividends and distributions 56,990 89,664
----------- -----------
168,684 331,339
Shares redeemed (147,998) (257,613)
----------- -----------
Net increase 20,686 73,726
=========== ===========
</TABLE>
(4) Investment Transactions:
Purchases and sales of securities other than short-term securities aggregated
$10,374,251 and $13,518,641, respectively, during the six months ended May 31,
1996.
(5) Management Advisory Fee and Other Transactions with Affiliates:
Pursuant to the Investment Advisory Agreement (the "Agreement"), Sentinel
Advisors, Co. ("SAC"), a Vermont general partnership whose general partners are
Sentinel Advisors, Inc., an indirect wholly-owned subsidiary of National Life
Insurance Company ("National Life"), ProvidentMutual Management Co., Inc., an
affiliate of Provident Mutual Life Insurance Company of Philadelphia ("Provident
Mutual"), HTK of Delaware, Inc. ("HTK") an affiliate of The Penn Mutual Life
Insurance Company ("Penn Mutual") and Sentinel Management Company ("SMC"), a
<PAGE>
Vermont general partnership whose general partners are affiliates of National
Life, Provident Mutual and Penn Mutual, provides general supervision of the
Trust's investments as well as certain administrative and related services. As
compensation in full for services rendered under its Agreement, the Trust pays
SAC a monthly fee determined as follows: 0.55% per annum on the first $50
million of average daily net assets; 0.50% per annum on the next $50 million of
such assets; and 0.45% per annum on such assets in excess of $100 million. The
Agreement provides that if certain expenses incurred by the Trust in any fiscal
year exceed the expense limitations imposed by any state's securities
regulations, SAC will reimburse the Company for any such excess. No
reimbursement was required for the period.
Sentinel Financial Services Company ("SFSC"), a Vermont general partnership
whose general partners are National Life Investment Management Company, Inc., a
wholly-owned subsidiary of National Life, ProvidentMutual Financial Services,
Inc., an affiliate of Provident Mutual, HTK and SMC, is the principal
underwriter ("Distributor") of the Trust's shares. SFSC receives a sales charge
added to the net asset value received by the Trust on the sale of its shares.
This compensation is not an expense of the Trust and does not affect its
operating results. SFSC has advised the Trust that it received sales charges
aggregating $39,963 for the six months ended May 31, 1996. The Trust is advised
that the total distribution charges retained by SFSC on the sale of shares
amounted to $218 after allowances of $7,481 to Equity Services, Inc., an
affiliate of National Life, $13,977 to 1717 Capital Management Company, an
affiliate of Provident Mutual, $1,179 to Hornor, Townsend & Kent, Inc. and
$5,421 to Janney Montgomery Scott, Inc., affiliates of Penn Mutual, and $11,687
to other investment dealers.
Each trustee who is not an employee of the adviser or an affiliated company is
paid an annual fee of $2,500 plus $200 for each meeting of the Board of Trustees
attended. Such trustees are reimbursed for travel and other out-of-pocket
expenses incurred in attending such meetings.
Pursuant to the Fund Services Agreement with Sentinel Administrative Service
Company ("SASC"), a Vermont general partnership whose general partners are
Sentinel Administrative Service Corporation ("SAS Corp."), an indirect wholly-
owned subsidiary of National Life, SIGMA American Corp., an affiliate of
Provident Mutual, HTK and SMC, the Trust receives trust accounting and financial
administrative services, transfer agent services and investor services, all of
which are coordinated with other services which the Trust has contracted for
with outside providers. Total fees for the six months ended May 31, 1996 were
$60,500.
Effective March 1, 1993 SASC has voluntarily agreed to refund its fee to the
extent necessary to prevent the overall aggregate expense ratio of the Trust and
the Class A Shares of Sentinel Group Funds, Inc. (excluding the Sentinel World
Fund) from exceeding 1.30% of average daily net assets in any fiscal year.
Sentinel Group Funds, Inc. is a series fund with eleven portfolios and together
with the Trust make up the Sentinel Family of Funds. Although SASC has no
present intention to do so, this arrangement may be terminated at any time.
Expenses for the six months ended May 31, 1996 did not exceed 1.30% of its
average daily net assets.
Effective March 27, 1995 thru May 14, 1995, SASC agreed to reimburse the Trust
for expenses in excess of an annual rate of 1.00%. Effective May 15, 1995, SASC
has agreed to reimburse the Trust for expenses in excess of an annual rate of
.75%. For the six months ended May 31, 1996 the total amount reimbursable was
$109,654. This arrangement may be terminated at any time.
(6) Distribution Expenses:
On March 1, 1993, the Trust adopted a new distribution plan ("Plan") pursuant to
Rule 12b-1 under the 1940 Act. Under the Plan the Trust pays to the Distributor
a monthly fee at the maximum annual rate of .20% of average daily net assets.
Such fees will be used to reimburse the Distributor for expenses incurred in
connection with distribution and promotion of the shares of the Trust, including
salaries and expenses of the Distributor's wholesale sales force, home office
management and marketing personnel, expenses incurred by the Distributor for the
occupancy of its office space in Montpelier, Vermont, expenses incurred by the
Distributor with respect to equipment and supplies, expenses incurred for the
preparation, printing and distribution of sales literature used in connection
with the offering of such shares to the public, expenses incurred in
advertising, promotion and selling shares of such Trust to the public, expenses
incurred for the preparation, printing and distribution of the Prospectus and
Statement of Additional Information, any supplement thereto used in connection
with the offering of such Trust's shares to the public, or any reports and other
communications for the distribution to existing shareholders, and service fees
(deferred commissions) paid to securities dealers who have executed a selling
agreement with the Distributor. The Distributor will not be reimbursed for any
unreimbursed eligible expenses in any future year.
<PAGE>
Sentinel Pennsylvania Tax-Free Trust
Financial Highlights
Selected per share data and ratios
Selected data for a share of capital stock outstanding throughout each fiscal
period.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Eleven Year Year
Six Months Year Ended Year Ended Months Ended Ended Ended
Ended 5/31/96 11/30/95 11/30/94 11/30/93(A) 12/31/92 12/31/91
(Unaudited)
------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 13.40 $ 12.29 $ 13.57 $ 13.15 $ 12.74 $ 12.25
Income from Investment Operations
Net investment income 0.33 0.66 0.64 0.69 0.73 0.71
Net realized and unrealized gain (loss) on
investments (0.49) 1.11 (1.28) 0.42 0.43 0.52
------------- ------------- ------------- ------------- ------------- -------------
Total from investment operations (0.16) 1.77 (0.64) 1.11 1.16 1.23
Less Distributions
Dividends from net investment income 0.33 0.66 0.64 0.69 0.75 0.74
Distributions from realized gains on
investments 0.08 - - - - -
------------- ------------- ------------- ------------- ------------- -------------
Total Distributions 0.41 0.66 0.64 0.69 0.75 0.74
------------- ------------- ------------- ------------- ------------- -------------
Net asset value at end of period $ 12.83 $ 13.40 $ 12.29 $ 13.57 $ 13.15 $ 12.74
============= ============= ============= ============= ============= =============
Total Return (%) ** (1.2)++ 14.8 (4.9) 8.1++ 9.4 10.3
Ratios/Supplemental Data
Ratio of net expenses to average
net assets (%) 0.75 + 0.97 1.30 1.24 + 1.16 1.27
Ratio of expenses to average net assets
before expense reductions (%) *** 1.43 + 1.36 1.30 1.24 + 1.16 1.27
Ratio of net investment income to average net
assets (%) 5.00 +* 5.14 * 4.84 5.07 + 5.62 5.71
Portfolio turnover rate (%) 32 80 56 23 1 8
Net assets at end of period (000 omitted) $33,767 $34,975 $31,172 $34,448 $33,669 $32,667
</TABLE>
(A) As of March 1, 1993 Sentinel Advisors Co. became the investment advisor to
the Trust.
+ Annualized
++ Not annualized
* Ratio of net investment income to average net assets would have been 4.36%
in 1996, and 4.78% in 1995, in the absence of a voluntary expense
reimbursement.
** Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of all
distributions at the net asset value during the period, and a redemption on
the last day of the period. Initial sales charge is not reflected in the
calculation of total return.
*** Expense reductions are comprised of the voluntary expense reimbursements and
include, effective 1995, the earnings credits as described in Notes (5) and
(1) D.
See Notes to Financial Statements.
<PAGE>
Privileges, Plans and Services for Shareholders
Open Account - Unless another distribution option is elected, an Open Account is
automatically established for each new investor. In an Open Account, all income
dividends and any capital gains distributions are reinvested in additional
shares at net asset value and without charge.
Other Distribution Options - Upon written notice to Sentinel Administrative
Service Company, you may elect one of the following options:
1. Receive dividends in cash and reinvest any capital gains distributions in
additional shares of any of the Sentinel Funds, of the same class, at net
asset value.
2. Receive both dividends and capital gains in cash.
3. Reinvest both dividends and capital gains in another Sentinel Fund, of the
same class, at net asset value.
Automatic Investment Plan - This service, provided without charge, enables you
to make regular investments of $50 or more by means of an automatic checking
account debiting service via the ACH (Automated Clearing House) network.
Information and the application necessary to establish this plan are included in
the prospectus. A separate folder and application are also available from
Sentinel Administrative Service Company, or from your investment dealer.
Systematic Withdrawal Plan - This plan enables you to receive a check once per
month, during any months of the year you specify, for a dollar amount that you
specify. Note that this plan is available only to those who own, or are
purchasing, at least $5,000 worth of shares of one or more of the Sentinel
Funds, except Sentinel U.S. Treasury Money Market Fund, as determined by the
current offering price. Payments may be made to you, your bank, or other payee
as requested on the application. Under the Systematic Withdrawal Plan, all
dividends and distributions are automatically reinvested at net asset value and
payments are made from the proceeds of redeemed shares.
Bond, Tax-Free Income, New York Tax-Free Income, Government Securities, Short-
Intermediate Government, U.S. Treasury Money Market and Pennsylvania Tax-Free
Fund Check Writing Service - This special feature of the Class A Shares of
Sentinel Bond Fund, Sentinel Tax-Free Income Fund, Sentinel New York Tax-Free
Income Fund, Sentinel Government Securities Fund, Sentinel Short-Intermediate
Government Fund, Sentinel U.S. Treasury Money Market Fund and Sentinel
Pennsylvania Tax-Free Trust enables you to draw checks (minimum amount $500
except for the U.S. Treasury Money Market Fund which is $250) on your account
through Investors Fiduciary Trust Co. There is currently no fee for this
service. Please note that this service is not available to IRA, Keogh, 403(b) or
other fiduciary accounts. Information and applications are available by
contacting Sentinel Funds Investor Services at (800) 282-FUND (3863).
Exchange Privilege - The Exchange Privilege is designed to add flexibility to
your investment program by enabling you to exchange all or part of your shares
in one Sentinel Fund for shares of the same class of another Fund in the family
without payment of any additional sales charge. The exception to no additional
sales charge is when shares are exchanged from the U.S. Treasury Money Market
Fund to Class A Shares of another Sentinel Fund, a sales charge will be imposed
unless the assets in the U.S. Treasury Money Market Fund were in another
Sentinel Fund and were previously subject to a sales charge. Shares being
exchanged into another Fund must have a value of at least $1,000 (the minimum
investment required to open a new account) unless you already have an account in
that Fund. Shares being exchanged must have been in the account a minimum of 15
calendar days (90 days in the case of funds initially invested in the Sentinel
Short-Intermediate Government Fund or exchanged into such Fund from funds
initially invested in the Sentinel U.S. Treasury Money Market Fund). Account
registrations must be identical. Exchanges may be made by calling toll-free,
(800) 282-FUND (3863), or by writing Sentinel Funds, P. O. Box 1499, Montpelier,
Vermont 05601-1499. Note that an exchange is a taxable transaction for federal
income tax purposes.
Reinstatement Privilege - A shareholder who redeems all or part of an account
may reinvest all or part of the redemption proceeds at the then current net
asset value if a written request to the Fund is received or postmarked within
one year after the date of the redemption. Sentinel Short-Intermediate
Government Fund shareholders who have held their shares for 90 days or less,
however, may only use this reinstatement privilege to reinvest in the Short-
Intermediate Government Fund. In general, this privilege may be exercised only
once by a shareholder.
Telephone Redemption - Up to $1,000,000 in funds may be redeemed by telephone
upon completion of the appropriate section of the Application, or subsequent
submission of such, with proper signature guarantee. Under this service,
proceeds may either be sent to the address of record or a pre-designated bank. A
signature guarantee is required on any change in redemption instructions as well
as a 30 day waiting period for changes to become effective. To redeem shares by
telephone, you may call (800) 282-FUND (3863).
<PAGE>
Tax-Deferred Retirement Plans - Shares of Sentinel Group Funds may be purchased
by all types of tax-deferred retirement plans, including self-employed
individuals and partnerships ("Keogh"), Individual Retirement Accounts ("IRA"),
Simplified Employee Pension Plans ("SEP-IRA"), 403(b) Plans (deferred
compensation arrangements for employees of public school systems and certain
non-profit organizations), Section 457 Plans and other corporate pension and
profit-sharing plans. Consult your tax advisor for details.
Please refer to the prospectus for complete details regarding these privileges,
plans and services.
<PAGE>
Directors/Trustees and Officers
Sentinel Group Funds, Inc. and
Sentinel Pennsylvania Tax-Free Trust
Keniston P. Merrill
Chairman and Chief Executive Officer
Executive Vice President,
National Life Insurance Company
Joseph M. Rob
President
Chairman and Chief Executive Officer,
Equity Services, Inc.
Richard J. Borda
Director/Trustee
Former Vice Chairman,
National Life Insurance Company
Dr. Kalman J. Cohen
Director/Trustee
Distinguished Bank Research
Professor Emeritus,
The Fuqua School of Business,
Duke University
Richard D. Farman
Director/Trustee
President and Chief Operating Officer
Pacific Enterprises
John D. Feerick
Director/Trustee
Dean, Fordham University
School of Law
Richard I. Johannesen, Jr.
Director/Trustee
Former Vice President and Manager -
Bond Market Research Department,
Salomon Brothers Inc.
Robert B. Mathias
Director/Trustee
Sports Consultant;
former U.S. Congressman
Deborah G. Miller
Director
Vice President
Digital Equipment Corporation
Stanley R. Reber
Director/Trustee
Executive Vice President,
Provident Mutual
Life Insurance Company
Susan M. Sterne
Director/Trustee
President, Economic Analysis Associates, Inc.
John M. Grab, Jr.
Vice President
Marvin Aber
Vice President and Treasurer
Thomas P. Malone
Assistant Treasurer
D. Russell Morgan
Secretary
Investment Adviser
Sentinel Advisors Company
Principal Underwriter
Sentinel Financial Services Company
Counsel
Brown & Wood
Independent Accountants
Price Waterhouse LLP
Custodian and Dividend Paying Agent
Investors Fiduciary Trust Company
Transfer Agent, Shareholder Servicing
Agent and Administrator
Sentinel Administrative Service Company
<PAGE>
A Brief History
[GRAPHIC APPEARS HERE]
The Sentinel Family of Funds is one of America's oldest fund families. Its
largest member, Sentinel Group Funds, Inc., was originally incorporated as Group
Securities, Inc. in the state of Delaware on December 3, 1933. Designed as a
series type of investment company, its main objectives were to offer
shareholders the benefits of "group security investing" along with the ability
to invest in individual industries or industrial groups readily and
conveniently, each in the form of a single stock.
Shares of 17 individual classes of stock were first offered to the public at
$1.10 per share on January 12, 1934 - virtually at the bottom of the Great
Depression.
Following several additions and deletions, 21 classes of stock were maintained
for an extended period of time. Subsequent consolidations, mergers and name
changes combined the classes of stock into what are today the two original
remaining funds in Sentinel Group Funds, Inc., Sentinel Common Stock Fund and
Sentinel Balanced Fund. Sentinel Growth Fund and Sentinel Bond Fund were
organized by National Life Insurance Company in 1969 and merged into the
Sentinel Group in 1978. Two more additions, Sentinel Government Securities Fund
and Sentinel Tax-Free Income Fund, were introduced on September 2, 1986 and
October 1, 1990, respectively.
In May, 1981, Sentinel Cash Management Fund, Inc. was organized as a no-load
money market fund. The "Cash Fund" was also organized as a series fund, and was
designed to operate independently of Sentinel Group Funds, Inc., while at the
same time sharing the Group's management, distribution, transfer agent and other
servicing and administrative arrangements.
On March 1, 1993, National Life Insurance Company and Provident Mutual Life
Insurance Company of Philadelphia entered into a joint venture arrangement which
resulted in the merging of the nine ProvidentMutual Funds into the Sentinel
Family of Funds. With the merger, three new classes of stock were added to
Sentinel Group Funds, Inc., and a fourth new member of the broader Sentinel
Family of Funds was added. The three new members of Sentinel Group Funds, Inc.
are Sentinel Emerging Growth Fund, Sentinel World Fund and Sentinel U.S.
Treasury Money Market Fund. The fourth new member of the Sentinel Family of
Funds is Sentinel Pennsylvania Tax-Free Trust (the "Trust"). The Trust operates
as a separate investment company with respect to Sentinel Group Funds, Inc., but
shares management, distribution, fund accounting, transfer agent and other
arrangements with the Sentinel Group.
Also on March 1, 1993, Sentinel Cash Management Fund, Inc. was merged into the
Sentinel U.S. Treasury Money Market Fund.
On March 27, 1995, Penn Mutual Life Insurance Company joined National Life
Insurance Company and Provident Mutual Life Insurance Company in their mutual
fund operation. This resulted in the merging of seven funds of The Independence
Capital Group of Funds into Sentinel Group Funds, Inc., and the creation of two
new classes of stock - Sentinel New York Tax-Free Income Fund and Sentinel
Short-Intermediate Government Fund.
Effective April 1, 1996, six Sentinel Funds offered two classes of shares:
Sentinel Emerging Growth, Sentinel World, Sentinel Common Stock, Sentinel
Balanced, Sentinel Bond and Sentinel Tax-Free Income funds. The new class is
called "Class B Shares" while the original class is called "Class A Shares."
Sentinel U.S. Treasury Money Market Fund also has Class B Shares which are
available only through exchanges from the other Class B Shares.
The twelve funds in the Sentinel Family of Funds, which includes the eleven
funds in Sentinel Group Funds, Inc., and the Sentinel Pennsylvania Tax-Free
Trust, now represent net assets of $2.1 billion which are managed on behalf of
approximately 100,700 individual, corporate and institutional shareholders
located across the country and around the world. Shares are distributed by
registered representatives and independent broker/dealers through Sentinel
Financial Services Company, an affiliate of the partnership between National
Life, Provident Mutual and Penn Mutual. Sentinel Advisors Company and Sentinel
Administrative Service Company, which are also affiliates of the partnership,
provide respective investment management and shareholder services to the funds.
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[GRAPHIC Sentinel Family
APPEARS of Funds
HERE] Integrity Since 1934
Sentinel Emerging Growth Fund
Sentinel Growth Fund
Sentinel World Fund
Sentinel Common Stock Fund
Sentinel Balanced Fund
Sentinel Bond Fund
Sentinel Tax-Free Income Fund
Sentinel New York Tax-Free Income Fund
Sentinel Government Securities Fund
Sentinel Short-Intermediate Government Fund
Sentinel U.S. Treasury Money Market Fund
Sentinel Pennsylvania Tax-Free Trust
Distributed by
Sentinel Financial Services Company
National Life Drive
Montpelier, Vermont 05604
This report is authorized for distribution to prospective investors only when
preceded or accompanied by an effective prospectus.
