Dear Shareholders:
During the past six months, it became apparent that the Federal Reserve
Board's credit tightening moves were succeeding in slowing economic growth
and keeping inflation in check. As a result, interest rates fell dramatically
and the municipal bond market staged a comeback. The net asset value of the
Trust rose from $8.73 on October 31, 1994 to $8.86 on April 30, 1995. Over
that same period, the Trust's market price on the New York Stock Exchange
increased from $9.125 at the end of October to $9.50 on April 30, 1995. In
spite of the wide fluctuations in interest rates which occurred, the Trust
was able to maintain a monthly dividend of $0.058 per share, and thus the
distribution rate on April 28, 1995, based on the most recent dividend
annualized and the stock market price of $9.50 in effect at the close of
business on that date, was 7.3%.
Economic Outlook
As the economy enters its fifth year of expansion, it is evidencing a
decidedly decelerating trend from its robust pace of 1994, when gross
domestic product expanded by 4.1%. Estimated growth in this year's first
quarter diminished to an annual rate of 2.8%. Consumer spending slowed
considerably during the quarter and was accompanied by a correspondingly
large increase in inventories. As we begin the year's second quarter, the
evidence suggests that the economy has entered a phase of less-than-full-
potential growth, as the April unemployment rate showed a second consecutive
monthly increase. We expect the economy to continue to grow at this more
subdued pace. We do not anticipate that the slowdown will deteriorate into a
recession and, conversely, we remain mindful of the potential for a
reliquified consumer sector to reassert itself as the year progresses.
Municipal Bond Market
The theme for the municipal bond market in 1995 continues to be the dramatic
reduction in new-issue supply. Issuance in 1994 was 44% lower than that in
record-breaking 1993. The trend continues into 1995, with issuance down an
additional 46% during the first three months of the year. The lack of supply,
combined with relatively weak demand from investors, is holding the municipal
market in a delicate balance, due primarily to the much-publicized Capitol
Hill discussions regarding tax reform.
One of the most notable events in the high-yield market during the past six
months was the much-anticipated opening of the Denver International Airport
on February 28, 1995. Although the opening was a significant milestone, the
continued successful operation of the airport will be closely monitored.
Other events that shaped the market included the downgrading to below
investment grade of Washington, D.C., and the bankruptcy filing of Orange
County, California, both of which underscored the importance of extensive
fundamental research.
Portfolio Performance and Strategy
Given this outlook, our strategy remains focused on credit research,
diversification and opportunity for price appreciation, as well as on
maximizing federally tax-free income. Call risk and sufficient supply of
high-yielding bonds will be the challenges for the remainder of 1995. July 1,
1995 is expected to be the largest municipal bond call date in history,
followed by an even larger call date on January 1, 1996. Because the Trust
has minimal call risk in the near future, we believe it may be possible to
maintain the current distribution rate of $0.058 per share, at least over the
next few months.
We appreciate your support and welcome any questions or comments you may
have.
Respectfully,
[Signature of A. Keith Brodkin]
A. Keith Brodkin
Chairman and President
[signature of Cynthia M. Brown]
Cynthia M. Brown
Portfolio Manager
May 17, 1995
1
<PAGE>
In accordance with Section 23(c) of the Investment Company Act of 1940, the
Trust hereby gives notice that it may from time to time repurchase shares of
the Trust in the open market at the option of the Board of Trustees and on
such terms as the Trustees shall determine.
Investment Objective and Policy
The investment objective of MFS(R) Municipal Income Trust is to provide high
current income exempt from federal income taxes.
The Trust seeks to achieve its objective by investing primarily in medium-
and lower-quality municipal bonds and notes. The Trust may also enter into
futures contracts and purchase securities on a "when-issued" basis.
Number of Employees
The Trust is organized as a Massachusetts business trust and is registered
under the Investment Company Act of 1940, as amended, as a closed-end,
non-diversified, management investment company and has no employees.
New York Stock Exchange Symbol
The New York Stock Exchange symbol is MFM.
Number of Shareholders
As of April 30, 1995, our records indicate that there are 8,818 registered
shareholders and approximately 16,600 shareholders owning Trust shares in
"street" name, such as through brokers, banks and other financial
intermediaries.
Performance Summary
(For the six months ended April 30, 1995)
<TABLE>
<CAPTION>
<S> <C>
Net Asset Value Per Share
October 31, 1994 $8.730
April 30, 1995 $8.860
New York Stock Exchange Price
October 31, 1994 $9.125
April 25, 1995 (high)* $9.625
November 22, 1994 (low)* $8.375
April 30, 1995 $9.500
</TABLE>
*For the period November 1, 1994 through April 30, 1995.
Dividend Reinvestment and
Cash Purchase Plan
The Trust offers a Dividend Reinvestment and Cash Purchase Plan which allows
you to reinvest either all of the distributions or only the long-term capital
gains paid by the Trust. Unless the shares are trading at a premium
(exceeding net asset value), purchases are made at the market price.
Otherwise, purchases will be made at a discounted price of either the net
asset value or 95% of the market price, whichever is greater. You can also
buy shares of the Trust. Investments from $100 to $500 can be made in January
and July on the 15th of the month or shortly thereafter.
If your shares are in the name of a brokerage firm, bank or other nominee,
you can ask the firm or nominee to participate in the Plan on your behalf. If
the nominee does not offer the Plan, you may wish to request that your shares
be re-registered in your own name so that you can participate.
There is no service charge to reinvest distributions, nor are there brokerage
charges for shares issued directly by the Trust. However, when shares are
bought on the New York Stock Exchange or otherwise on the open market, each
participant pays a pro rata share of the commissions. A service fee of $0.75
is charged for each cash purchase as well as a pro rata share of the
brokerage commissions, if any. The automatic reinvestment of distributions
does not relieve you of any income tax that may be payable (or required to be
withheld) on the distributions.
To enroll in or withdraw from the Plan or to receive a brochure providing a
complete description of the Plan, please contact the Plan agent at the
address and telephone number located on the back cover of this report. Please
have available the name of the Trust and your account and Social Security
numbers. For certain types of registrations, such as corporate accounts,
instructions must be submitted in writing. When you withdraw from the Plan,
you can receive the value of the reinvested shares in one of two ways: a
check for the value of the full and fractional shares, or a certificate for
the full shares and a check for the fractional shares.
2
<PAGE>
Portfolio of Investments -- April 30, 1995
Municipal Bonds -- 98.8%
<TABLE>
<CAPTION>
Principal
Amount
(000
Issuer Omitted) Value
<S> <C> <C>
Student Loan Revenue -- 0.6%
Arizona Student Loan Acquisition Authority, 7.625s, 2010 $ 750 $ 814,388
Pennsylvania Higher Education Assistance Agency, AMBAC, RIBS, 7.833s,
20229(section)(section) 1,300 1,228,162
-----------
$ 2,042,550
-----------
General Obligation -- 2.6%
Arapahoe County, CO, Water & Sanitation District, 9.25s, 2013 $ 2,000 $ 2,105,880
City of Markham, Cook County, IL, 9s, 2012 1,300 1,377,961
Jefferson County, OH, 7.125s, 2019 2,000 2,043,200
New Lenox, IL, Industrial Development Rev., 8.25s, 2014 2,000 2,010,580
Triview, CO, Metropolitan District, 13s, 2004+*# 2,500 1,250,000
-----------
$ 8,787,621
-----------
State and Local Appropriation -- 0.3%
Troy, NY, Certificate of Participation, Recreational Facilities Rev.,
9.75s, 2010 $ 1,100 $ 1,182,841
-----------
Refunded and Special Obligation -- 13.4%
Dayton, OH, Special Facilities Rev. (Emery Air Freight), "A", 12.5s,
2009 $ 1,000 $ 1,172,670
Grand Junction, CO (Lincoln Park Osteopathic Hospital), 10.5s, 2017 1,250 1,457,175
Maine Health & Higher Education Facilities Authority (d'Youville
Pavilli), 10s, 2017 7,690 8,840,270
Maine Health & Higher Education Facilities Authority (St. Mary's
Hospital), 8.625s, 2022 1,000 1,147,430
Mississippi Hospital Equipment & Facilities Authority Rev. (Rush Medical
Center), 8.75s, 2001 1,000 1,090,980
Russellville, AR, Industrial Development Rev. (Charles Meyers Project),
10s, 2009 5,565 6,639,212
Telluride Gondola, CO, Real Estate Transfer, 11.5s, 2012 990 1,542,816
Telluride Gondola, CO, Real Estate Transfer, 11.5s, 2012 1,910 1,900,355
Texas Turnpike Authority (Houston Ship Channel Bridge), 0s, 2002 10,565 14,206,439
Washington Public Power Supply System Project #1, 15s, 1996 3,740 4,281,440
Washington Public Power Supply System Project #1, 14.375s, 2001 1,825 2,453,128
-----------
$44,731,915
-----------
Single Family Housing Revenue -- 7.8%
Austin, TX, Housing Finance Corp., 0s, 2016 $26,435 $ 2,447,352
Berkeley, Brookes, & Fayette Counties, WV, MBIA, 0s, 2016 14,000 1,427,300
Cook County, IL, Single Family Housing, 0s, 2015 2,160 240,170
Corpus Christi, TX, Housing Finance Corp., 0s, 2011 3,000 633,600
Dallas, TX, Housing Finance Corp., Single Family Mortgage Rev., MBIA,
0s, 2016 15,820 1,664,739
Denver, CO, City & County Airport Rev., 0s, 2015 9,450 884,804
Duval County, FL, Housing Finance Authority, 0s, 2015 23,815 2,502,242
Florida Housing Finance Agency, 0s, 2012 4,750 840,798
Harris County, TX, Housing Finance Corp., 9.625s, 2003 1,365 1,380,384
Harris County, TX, Housing Finance Corp., 9.875s, 2014 855 864,644
Jackson County, MO, 0s, 2016 8,035 767,825
Louisiana Housing Finance Agency, Single Family Mortgage Rev., FGIC,
9.375s, 2015 415 428,678
Nebraska Investment Finance Authority, 0s, 2015 48,500 6,772,540
Nebraska Investment Finance Authority, 0s, 2016 4,790 411,844
Nevada Housing Division, 0s, 2015 1,949 263,981
Ohio Housing Finance Agency, GNMA, RIBS, 9.324s, 2031(section)(section) 1,000 1,039,900
Reno County, KS, Mortgage Rev., 0s, 2014 5,725 646,467
Saline County, KS, 0s, 2014 2,375 283,979
Utah Housing Finance Agency, Residential Mortgage Rev., 9s, 2019 85 56,224
West Virginia Housing Development Fund, 0s, 2015 13,355 1,673,515
Wisconsin Housing & Economic Development Authority, Home Ownership Rev.,
RIBS, 9.642s, 2022(section)(section) 900 942,858
-----------
$26,173,844
-----------
3
<PAGE>
Portfolio of Investments -- continued
Municipal Bonds -- continued
Multi-Family Housing Revenue -- 7.2%
Bexar County, TX, Housing Finance Corp., 0s, 2015 $26,300 $ 3,032,390
Broward County, FL, Housing Finance Authority (Deerfield Beach
Apartments), 13s, 2001*S.# 86 49,451
Colorado Housing Finance Authority, 9s, 2025 955 874,379
Dade County, FL, Housing Finance Agency, Multi-Family Housing, 8.375s,
2002 5,466 5,584,522
Dade County, FL, Housing Finance Agency, Multi-Family Housing, 8.375s,
2002 4,317 4,410,715
Dallas, TX, Housing Finance Corp., 8.5s, 2011 1,400 1,438,136
Escondido, CA, Community Development Authority (Las Villas del Norte),
8.875s, 2005 830 815,583
Florida Housing Finance Agency (Mutual Benefit Life), 7s, 2004 600 510,000
Florida Housing Finance Agency (South Lake Apartments), 8.7s, 2021 1,500 1,510,095
Kenton County, KY, Industrial Development Rev. (Highland Terrace), 8.7s,
2026 5,330 5,711,361
Memphis, TN, Health, Education & Housing Facilities Board (Wesley
Highland Terrace), 12.75s, 2015+++ 100 85,000
-----------
$24,021,632
-----------
Insured Health Care Revenue -- 1.3%
Clermont County, OH, Hospital Facilities Rev. (Mercy Health System),
AMBAC, MVRIC, 9.001s, 2021(section)(section) $ 500 $ 534,160
Desert Hospital District, CA, Hospital Rev. (Desert Hospital), CG, COP,
MVRIC, 8.304s, 2020(section)(section) 1,500 1,541,190
North Central Texas, Health Facilities Development Corp. (Presbyterian
Hospital), 8.945s, 2021(section)(section) 1,500 1,554,270
Salt Lake City, UT, Hospital Rev. (Intermountain Health Care), AMBAC,
INFLO, 9.16s, 2020(section)(section) 650 686,719
-----------
$ 4,316,339
-----------
Health Care Revenue -- 24.4%
Arkansas Development Finance Authority, Economic Development Rev.
(Southwest Homes), 11s, 2018 $ 1,435 $ 1,521,746
Bell County, TX, Health Facilities Authority (Kings Daughters Hospital),
9.25s, 2008 845 932,559
Bell County, TX, Health Facilities Development Corp. (Advanced Living
Technology), 10.5s, 2018 4,245 3,905,400
Boonville, MO, Health Facilities Rev. (Gericare, Inc.), 11s, 2017 1,900 2,010,086
Boston, MA, Industrial Development Finance Authority Rev. (Stonehedge
Convalescent Center), 10.75s, 2011 895 969,419
Brevard County, FL, Health Facilities Authority Rev. (Friendly Village),
9.25s, 2012 2,320 2,372,223
Broward County, FL, Industrial Development Rev. (Beverly Enterprises,
Inc.), 9.8s, 2010 2,710 2,996,176
Cambria County, PA, Industrial Development Authority (Beverly
Enterprises), 10s, 2012 840 1,009,840
Chester County, PA, Industrial Development Authority (RHA/PA Nursing
Home, Inc.), 10.125s, 2019 990 1,008,067
Connecticut Health & Educational Facilities (Johnson Evergreen Corp.),
8.5s, 2014 650 674,928
Daphne, AL, Special Care Facilities Financing Authority (Westminster
Village), 8.25s, 2026*# 500 340,000
District of Columbia, Hospital Rev. (Hospital for Sick Children),
8.875s, 2021 490 524,339
Fairfax, Fauquier & Loudoun Counties, VA, Health Center Commission,
Nursing Home Rev., 9s, 2020 1,940 1,993,913
Fulton County, GA, Residential Care Facilities, Elderly Authority Rev.
(Lenbrook Square Foundation), 9.75s, 2017 2,820 2,917,064
Gadsden County, FL, Industrial Development Authority (RHA/FLA
Properties), 10.45s, 2018 2,610 2,675,563
Greenville County, SC, Hospital Facility Rev. (Chestnut Hill), 10.375s,
2016 2,930 2,959,300
Hannibal, MO, Industrial Development Authority (Hannibal Regional Health
Care System, Inc.), 9.5s, 2022# 1,500 1,729,230
Hobbs, NM, Health Facilities Rev. (Nemecal Associates), 9.625s, 2014 955 1,001,174
Hopewell County, VA, Hospital Authority (John Randolph Hospital), 8.85s,
2013 1,100 1,128,644
Jackson County, IL, First Mortgage Rev. (Styrest Nursing Home), 9.4s,
2000+*# 60 6,960
Jackson County, IL, First Mortgage Rev. (Styrest Nursing Home), 9.5s,
2005+*# 550 63,800
Jackson County, IL, First Mortgage Rev. (Styrest Nursing Home), 9.75s,
2010+*# 1,400 162,400
Jackson County, IL, First Mortgage Rev. (Styrest Nursing Home), 10s,
2016+*# 535 62,060
Lee County, FL, Industrial Development Authority (Beverly Enterprises),
10s, 2010 2,110 2,370,796
Lexington-Fayette Counties, KY, Health Care Facilities Rev. (Sayre
Christian Village), 10s, 2012 1,575 1,613,367
Louisiana Public Facilities Authority (Chateau Riviere Home for the
Aged), 10.25s, 2016 3,430 3,560,876
Louisiana Public Facilities Authority (Southwest Medical Center), 11s,
2006 4,623 2,731,042
4
<PAGE>
Health Care Revenue -- continued
Mass. Health & Education Facilities Authority (Fairview Extended Care
Facility), 10.25s, 2021 $1,500 $ 1,635,705
Mass. Industrial Finance Agency (Martha's Vineyard Long-Term Care),
9.25s, 2022 1,700 1,615,000
Mass. Industrial Finance Agency (Needham/Hamilton House), 11s, 2010 1,000 1,021,920
Monongalia County, WV, Health Facilities Rev. (Beverly Enterprises,
Inc.), 10s, 2007 1,090 1,205,420
Montgomery County, OH, Hospital Rev. (Kettering Convalescent Center),
10s, 2020 1,000 1,047,860
Montgomery County, PA, Higher Education & Health Authority Rev.
(AHF/Montgomery, Inc.), 10.5s, 2020 2,500 2,573,875
New Jersey Economic Development Authority (Courthouse Convalescent
Center), 8.7s, 2014 650 659,809
New Jersey Economic Development Authority (Geriatric & Medical Services,
Inc.), 9.625s, 2004 205 218,643
New Jersey Economic Development Authority (Geriatric & Medical Services,
Inc.), 9.625s, 2022 675 717,984
New Jersey Economic Development Authority (Greenwood Health Care),
9.75s, 2011 1,510 1,510,800
New Jersey Economic Development Authority (Wanaque Convalescent Center),
8.6s, 2011 1,000 985,580
North Carolina Medical Care Commission, Hospital Rev. (Valdese General
Hospital), 8.75s, 2016 1,475 1,533,307
Okaloosa County, FL, Retirement Rental Housing Rev. (Beverly
Enterprises, Inc.), 10.75s, 2003 1,490 1,633,055
Orange County, FL, Industrial Development Authority (Friendly Village),
9.25s, 2012 150 152,445
Orange County, FL, Industrial Development Authority Rev., 9.25s, 1997 1,805 1,868,969
Osceola County, FL, Industrial Development Rev. (Community Provider
Pooled Loan Project), 7.75s, 2017 1,300 1,318,434
Philadelphia, PA, Industrial Development Authority, 10.25s, 2018 2,370 2,437,569
Philadelphia, PA, Industrial Development Authority, 10.25s, 2018 1,985 2,045,007
Prince William County, VA, Industrial Development Authority, Residential
Care (Westminster at Lake Ridge), 10s, 2022 1,500 1,598,220
Rochester, MN (Mayo Foundation/Mayo Medical Foundation), FIRS, 7.34s,
2021++++ 1,000 1,012,270
Santa Fe, NM, Industrial Development Rev. (Casa Real Nursing Home),
9.75s, 2013 1,185 1,228,927
Seminole County, FL, Industrial Development Authority (Friendly
Village), 10s, 2011 1,855 1,939,346
St. Charles County, MO, Industrial Development Authority (Garden View
Care Center), 10s, 2016 2,325 2,375,290
St. Petersburg, FL, Health Facilities Rev. (Swanholm Nursing), 10s, 2022 790 840,465
Suffolk County, NY, Industrial Development Agency (A Planned Program),
9.75s, 2015 1,370 1,233,000
Washington County, FL, Industrial Development Authority (Washington
County), 10s, 2016 1,140 1,086,694
Waterford Township, MI, Economic Development Rev. (Canterbury Health),
8.375s, 2023 1,500 1,534,590
Westside Habilitation Center, Cheneyville, LA, 8.375s, 2013 1,300 1,239,836
-----------
$81,510,992
-----------
Electric and Gas Utility Revenue -- 1.3%
Midland Michigan Environmental Development Authority, Pollution Control
Rev. (Midland Cogeneration), 9.5s, 2009 $1,500 $ 1,602,060
Montana Board of Investment Resources Recovery Rev. (Yellowstone
Energy), 7s, 2019 945 873,832
New Jersey Economic Development Authority (Vineland Cogeneration),
7.875s, 2019 1,000 1,062,350
Southern California Public Power Authority, Transportation Project,
RIBS, 6.644s, 2012(section)(section) 650 641,108
-----------
$ 4,179,350
-----------
Turnpike Revenue -- 2.3%
Massachusetts Industrial Finance Agency, Tunnel Rev. (Mass. Turnpike),
9s, 2020 $3,900 $ 4,191,018
San Joaquin Hills, CA, 0s, 2006 2,300 1,000,339
San Joaquin Hills, CA, Transportation Corridor Agency, Toll Road Rev.,
0s, 2011 6,600 1,927,530
West Virginia Parkways, Economic Development & Tourism Authority,
7.068s, 2019(section)(section) 600 551,268
-----------
$ 7,670,155
-----------
Airport and Port Revenue -- 4.7%
Cleveland, OH, Airport Special Facilities Rev. (Continental Airlines),
9s, 2019 $3,150 $ 3,145,558
Denver, CO, City & County Airport Rev., 8.75s, 2023 1,500 1,660,380
Hillsborough County, FL, Aviation Authority Rev. (US Air), 8.6s, 2022 650 656,103
5
<PAGE>
Portfolio of Investments -- continued
Municipal Bonds --continued
Airport and Port Revenue -- continued
Kenton County, KY, Airport Board Special Facilities (Delta Airlines),
7.5s, 2020 $ 1,000 $ 1,015,890
St. Augustine, FL, Airport Authority, Airport Rev. (Grumman Repair
Facility), 11s, 2004 2,575 2,758,186
Tulsa, OK, Municipal Airport Trust Rev., 7.375s, 2020 3,400 3,429,410
Tulsa, OK, Municipal Airport Trust Rev., 7.6s, 2030 3,000 3,059,220
-----------
$15,724,747
-----------
Sales and Excise Tax Revenue -- 0.7%
Chicago, IL (Ryan Garfield Tax Increment Rev.), 10.125s, 2007 $ 1,745 $ 1,808,762
Denver, CO, Urban Renewal Tax, 8.5s, 2013 500 459,290
-----------
$ 2,268,052
-----------
Industrial Revenue (Corporate Guarantee) -- 18.2%
Atlanta, GA, Special Purpose Facilities Rev. (Delta Airlines Project),
7.9s, 2018 $ 2,100 $ 2,167,137
Charleston County, SC, Resource Recovery Rev. (Foster Wheeler), 9.25s,
2010 1,750 1,922,042
East Chicago, IN, Pollution Control Rev. (Inland Steel Co.), 10s, 2011 11,000 11,811,800
Eastern Band of Cherokee Indian Community, NC (Carolina Mirror Co.),
10.25s, 2009 6,945 7,329,892
Eastern Band of Cherokee Indian Community, NC (Carolina Mirror Co.),
11s, 2012# 650 692,022
El Paso, TX, Industrial Development Authority (Popular Dry Goods Co.),
9.875s, 2016 8,500 8,707,995
Hernando County, FL, Water & Sewer Rev. (Florida Crushed Stone Co.),
8.5s, 2014 3,000 3,141,510
Hodge Village, LA, Utilities Rev. (Stone Container Corp.), 9s, 2010 7,585 7,993,983
Hunt County, TX, Industrial Development Rev. (Household Manufacturing),
10.236s, 2003 2,700 2,620,755
Lawrenceburg, TN, Industrial Development Board (Tridon, Inc.), 9.875s,
2006 1,500 1,518,270
Massachusetts Industrial Financing Agency (Solid Waste Disposal Rev.),
8.25s, 2014 3,000 3,062,430
Mesa County, CO (Joy Technologies), 8.5s, 2006 650 677,410
Port of Corpus Christi, TX (Valero Energy), 10.25s, 2017 4,000 4,418,360
Port of New Orleans, LA, 8.25s, 2004 1,000 1,076,140
Port of New Orleans, LA, Industrial Development Rev., 8.5s, 2014 1,650 1,800,084
Walton, GA, Industrial Development Rev. (Ultima Rubber Products, Inc.),
10s, 2010 1,820 1,915,696
-----------
$60,855,526
-----------
Universities -- 0.7%
Mass. Industrial Finance Agency (Emerson College), 8.9s, 2018 $ 2,000 $ 2,211,600
-----------
Other -- 13.3%
Bristol, CT, Resource Recovery Facilities, 6.5s, 2014** $ 3,000 $ 2,847,330
Cleveland County, OK, Development Authority (Trails Inn), 12.5s, 2012*+# 9,625 5,101,250
Connecticut Development Authority (Southington Associates), 10s, 2016+*# 4,425 2,655,000
Crystal City, TX, Lease Obligations, 10.5s, 2008*# 4,243 4,052,760
Danville, VA, Industrial Development Rev. (Piedmont Mall ), 8s, 2017 5,795 5,564,475
District of Columbia (National Public Radio), 7.7s, 2023 2,500 2,556,575
Downtown Marietta Development Authority, GA (Marietta Station), 10.25s,
1996+*# 2,166 898,949
Maryland Energy Financing Administration (Solid Waste), 9s, 2016 6,000 5,978,760
Michigan Strategic Funding, Limited Obligation Rev. (Blue Water Fiber),
8s, 2012 1,000 931,360
Michigan Strategic Funding, Limited Obligation Rev. (Great Lakes Fibre
Project), 10.25s, 2016 5,000 5,189,600
Pennsylvania Economic Development Finance Authority, Recycling Rev.,
9.25s, 2022 5,000 5,039,200
6
<PAGE>
Other -- continued
Retema, TX, Special Facilities Rev. (Retema Park Racetrack Project),
8.75s, 2018 $3,290 $ 3,188,734
St. Louis County, MO, Industrial Development Authority (Kiel Center
Arena), 7.875s, 2024 300 304,965
-----------
$ 44,308,958
-----------
Total Investments (Identified Cost, $320,285,625) $329,986,122
Other Assets, Less Liabilities -- 1.2% 3,888,676
-----------
Net Assets -- 100.0% $333,874,798
===========
</TABLE>
+ Non-income producing security -- in default.
++ Security accruing only partial interest.
+++ Indexed security.
* Security valued by or at the direction of the Trustees.
** When-issued security.
(section) Non-income producing security.
(section)(section) Inverse floating rate security.
# Restricted security.
See notes to financial statements
7
<PAGE>
Statement of Assets and Liabilities -- April 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Assets:
Investments, at value (identified cost, $320,285,625) $ 329,986,122
Receivable for investments sold 327,775
Interest receivable 8,445,188
Other assets 4,434
-------------
Total assets $ 338,763,519
-------------
Liabilities:
Cash overdraft $ 1,184,732
Distributions payable 301,550
Payable for when-issued investments purchased 3,000,000
Payable to affiliates --
Management fee 26,787
Transfer and dividend disbursing agent fee 11,500
Accrued expenses and other liabilities 364,152
-------------
Total liabilities $ 4,888,721
-------------
Net assets $ 333,874,798
=============
Net assets consist of:
Paid-in capital $ 353,518,631
Unrealized appreciation on investments 9,700,497
Accumulated undistributed net realized loss on investments (30,319,606)
Accumulated undistributed net investment income 975,276
-------------
Total $ 333,874,798
=============
Shares of beneficial interest outstanding 37,685,050
=============
Net asset value per share (net assets / shares of beneficial interest outstanding) $ 8.86
=============
</TABLE>
Statement of Operations -- Six Months Ended April 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Net investment income:
Interest income $ 14,959,435
------------
Expenses --
Management fee $ 1,591,311
Trustees' compensation 63,972
Transfer and dividend disbursing agent fee 70,046
Legal fees 221,892
Custodian fee 68,747
Postage 46,589
Auditing fees 30,180
Printing 11,769
Miscellaneous 65,343
------------
Total expenses $ 2,169,849
------------
Net investment income $ 12,789,586
------------
Realized and unrealized gain (loss) on investments:
Realized loss on investment transactions (identified cost basis) $ (1,559,791)
Change in unrealized appreciation on investments 6,750,147
------------
Net realized and unrealized gain on investments $ 5,190,356
------------
Increase in net assets from operations $ 17,979,942
============
</TABLE>
8
<PAGE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
Increase (decrease) in net assets: Six Months
Ended Year Ended
April 30, October 31,
1995 1994
----------- -------------
From operations --
Net investment income $
12,789,586 $ 25,188,088
Net realized loss on investments (1,559,791) (7,845,685)
Net unrealized gain (loss) on investments 6,750,147 (2,969,705)
----------- -------------
Increase in net assets from operations $ 17,979,942 $ 14,372,698
----------- -------------
Distributions declared to shareholders from net investment income $(13,084,575) $(25,961,909)
----------- -------------
Trust share (principal) transactions --
Net asset value of shares issued to shareholders in reinvestment of
distributions $ 1,786,765 $ 3,525,668
----------- -------------
Total increase (decrease) in net assets $ 6,682,132 $ (8,063,543)
Net assets:
At beginning of period 327,192,666 335,256,209
----------- -------------
At end of period (including undistributed net investment income of
$975,276 and $1,270,265, respectively) $333,874,798 $327,192,666
=========== =============
</TABLE>
Financial Highlights
<TABLE>
<CAPTION>
Six Months
Ended
April 30, Year Ended October 31,
--------------------------------------
1995 1994 1993 1992
------------ ---------- ---------- ----------
<S> <C> <C> <C> <C>
Per share data (for a share
outstanding throughout each
period):
Net asset value -- beginning of
period $8.73 $9.04 $8.78 $8.94
---------- -------- -------- --------
Income from investment operations
--
Net investment income# $0.34 $0.68 $0.75 $0.73
Net realized and unrealized
gain (loss) on investments 0.14 (0.29) 0.21 (0.17)
---------- -------- -------- --------
Total from investment
operations $0.48 $0.39 $0.96 $0.56
---------- -------- -------- --------
Less distributions declared to
shareholders from net
investment income $(0.35) $(0.70) $(0.70) $(0.72)
---------- -------- -------- --------
Net asset value -- end of period $8.86 $8.73 $9.04 $8.78
========== ======== ======== ========
Per share market value -- end of
period $9.500 $9.125 $10.000 $9.000
========== ======== ======== ========
Total return 8.31%+++ (1.47)% 10.95% 5.34%
Ratios (to average net assets)/
Supplemental data:
Expenses 1.33%+ 1.31% 1.33% 1.34%
Net investment income 7.87%+ 7.58% 7.55% 8.17%
Portfolio turnover 10% 22% 14% 17%
Net assets at end of period
(000 omitted) $ 333,875 $327,193 $335,256 $323,060
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
1991 1990 1989 1988 1987*
------------ ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Per share data (for a share
outstanding throughout each
period):
Net asset value -- beginning of
period $ 9.02 $ 9.44 $ 9.22 $ 8.67 $ 9.40
---------- -------- -------- -------- --------
Income from investment operations
--
Net investment income# $ 0.70 $ 0.75 $ 0.76 $ 0.75 $ 0.65
Net realized and unrealized
gain (loss) on investments (0.05) (0.41) 0.22 0.54 (0.79)
---------- -------- -------- -------- --------
Total from investment
operations $ 0.65 $ 0.34 $ 0.98 $ 1.29 $ (0.14)
---------- -------- -------- -------- --------
Less distributions declared to
shareholders from net
investment income $ (0.73) $ (0.76) $ (0.76) $ (0.74) $ (0.59)
---------- -------- -------- -------- --------
Net asset value -- end of period $ 8.94 $ 9.02 $ 9.44 $ 9.22 $ 8.67
========== ======== ======== ======== ========
Per share market value -- end of
period $ 9.250 $ 8.375 $ 9.875 $ 9.875 $ 8.500
========== ======== ======== ======== ========
Total return 19.88% (7.87)% 8.32% 26.11% (10.10)%+
Ratios (to average net assets)/
Supplemental data:
Expenses 1.27% 1.21% 1.28% 1.25% 1.04%+
Net investment income 7.79% 8.07% 8.15% 8.35% 7.62%+
Portfolio turnover 21% 19% 16% 37% 58%
Net assets at end of period
(000 omitted) $325,077 $325,767 $338,461 $327,193 $305,118
</TABLE>
*For the period from the commencement of investment operations, November 25,
1986 to October 31, 1987.
+Annualized.
++Not annualized.
#For the periods subsequent to October 31, 1992, certain of the per share
data were computed using average shares outstanding.
9
<PAGE>
Notes to Financial Statements
(1) Business and Organization
The Trust is organized as a Massachusetts business trust and is registered
under the Investment Company Act of 1940, as amended, as a non-diversified,
closed end, management investment company. The following is a summary of
significant accounting policies consistently followed by the Trust in the
preparation of its financial statements.
(2) Significant Accounting Policies
Investment Valuations -- Debt securities (other than short-term obligations
which mature in 60 days or less), including listed issues, are valued on the
basis of valuations furnished by dealers or by a pricing service with
consideration to factors such as institutional-size trading in similar groups
of securities, yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other market data, without exclusive reliance upon
exchange or over-the-counter prices. Short-term obligations, which mature in
60 days or less, are valued at amortized cost, which approximates value.
Futures contracts, options and options on futures contracts listed on
commodities exchanges are valued at closing settlement prices.
Over-the-counter options are valued by brokers through the use of a pricing
model which takes into account closing bond valuations, implied volatility
and short-term repurchase rates. Securities for which there are no such
quotations or valuations are valued at fair value as determined in good faith
by or at the direction of the Trustees.
Repurchase Agreements -- The Trust may enter into repurchase agreements with
institutions that the Trust's investment adviser has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Trust
requires that the securities purchased in a repurchase transaction be
transferred to the custodian in a manner sufficient to enable the Trust to
obtain those securities in the event of a default under the repurchase
agreement. The Trust monitors, on a daily basis, the value of the securities
transferred to ensure that the value, including accrued interest, of the
securities under each repurchase agreement is greater than amounts owed to
the Trust under each such repurchase agreement.
Futures Contracts -- The Trust may enter into financial futures contracts for
the delayed delivery of securities or contracts based on financial indices at
a fixed price on a future date. In entering such contracts, the Trust is
required to deposit either in cash or securities an amount equal to a certain
percentage of the contract amount. Subsequent payments are made or received
by the Trust each day, depending on the daily fluctuations in the value of
the underlying security, and are recorded for financial statement purposes as
unrealized gains or losses by the Trust. The Trust's investment in financial
futures contracts is designed to hedge against anticipated future changes in
interest rates or securities prices. For example, interest rate futures may
be used in modifying the duration of the portfolio without incurring the
additional transaction costs involved in buying and selling the underlying
securities. The Trust may also invest in futures contracts for non-hedging
purposes. Should interest rates or securities prices move unexpectedly, the
Trust may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss.
Investment Transactions and Income -- Investment transactions are recorded on
the trade date. Interest income is recorded on the accrual basis. All premium
and original issue discount are amortized or accreted for both financial
statement and tax reporting purposes as required by federal income tax
regulations.
The Trust has approximately 86.3% of its portfolio invested in high-yield
securities rated below investment grade. Investments in high-yield securities
are accompanied by a greater degree of credit risk and the risk tends to be
more sensitive to economic conditions than that of higher rated securities.
The Trust uses the effective interest method for reporting interest income on
payment-in-kind (PIK) bonds, whereby interest income on PIK bonds is recorded
ratably by the Trust at a constant yield to maturity. Legal
10
<PAGE>
fees and other related expenses incurred to preserve and protect the value of
a security owned are added to the cost of the security; other legal fees are
expensed. Capital infusions, which are generally non-recurring, incurred to
protect or enhance the value of high-yield debt securities, are reported as
an addition to the cost basis of the security. Costs that are incurred to
negotiate the terms or conditions of capital infusions or that are expected
to result in a plan of reorganization are considered workout expenses and are
reported as realized losses. Ongoing costs incurred to protect or enhance an
investment, or costs incurred to pursue other claims or legal actions, are
reported as operating expenses.
Tax Matters and Distributions -- The Trust's policy is to comply with the
provisions of the Internal Revenue Code (the Code) applicable to regulated
investment companies and to distribute to shareholders all of its net taxable
income, including any net realized gain on investments. Accordingly, no
provision for federal income or excise tax is provided. The Trust files a tax
return annually using tax accounting methods required under provisions of the
Code which may differ from generally accepted accounting principles, the
basis on which these financial statements are prepared. Accordingly, the
amount of net investment income and net realized gain reported on these
financial statements may differ from that reported on the Trust's tax return
and, consequently, the character of distributions to shareholders reported in
the financial highlights may differ from that reported to shareholders on
Form 1099-DIV.
Distributions paid by the Trust from net interest received on tax-exempt
municipal bonds are not includable by shareholders as gross income for
federal income tax purposes because the Trust intends to meet certain
requirements of the Code applicable to regulated investment companies which
will enable the Trust to pay exempt-interest dividends. That portion of such
interest, if any, earned on private activity bonds issued after August 7,
1986, may be considered a tax preference item to shareholders. Distributions
to shareholders are recorded on the ex-dividend date.
The Trust distinguishes between distributions on a tax basis and a financial
reporting basis and requires that only distributions in excess of tax basis
earnings and profits are reported in the financial statements as a return of
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes, are classified
as distributions in excess of net investment income or accumulated net
realized gains.
(3) Transactions with Affiliates
Investment Adviser -- The Trust has an investment advisory agreement with
Massachusetts Financial Services Company (MFS) to provide overall investment
advisory and administrative services, and general office facilities. The
management fee, computed daily and paid monthly at an effective annual rate
of 0.40% of average daily net assets and 6.32% of investment income, amounted
to $1,591,311. The Trust pays no compensation directly to its Trustees who
are officers of the investment adviser, or to officers of the Trust, all of
whom receive remuneration for their services to the Trust from MFS. Certain
of the officers and Trustees of the Trust are officers or directors of MFS
and MFS Service Center, Inc. (MFSC). The Trust has an unfunded defined
benefit plan for all its independent Trustees. Included in Trustees'
compensation is a net periodic pension expense of $17,973 for the six months
ended April 30, 1995.
Transfer Agent -- The Trust has entered into an agreement with MFSC, a wholly
owned subsidiary of MFS, to act as registrar and dividend disbursing agent to
the Trust. The agreement provides that the Trust will pay MFSC an account
maintenance fee and a dividend services fee and will reimburse MFSC for
reasonable out-of-pocket expenses. The account maintenance fee is computed
as follows:
Total Number of Accounts Annual Account Fee
- -------------------------- --------------------
Less than 75,000 $9.00
75,000 and over $8.00
11
<PAGE>
Notes to Financial Statements -- continued
The dividend services fee is $0.75 per dividend reinvestment and $0.75 per
cash infusion. Fees incurred under the agreement for the six months ended
April 30, 1995 amounted to $70,046.
(4) Portfolio Securities
Purchases and sales of investments, other than U.S. government securities,
purchased option transactions and short-term obligations, aggregated
$34,012,699 and $34,062,342, respectively.
The cost and unrealized appreciation or depreciation in value of the
investments owned by the Trust, as computed on a federal income tax basis,
are as follows:
<TABLE>
<CAPTION>
<S> <C>
Aggregate cost $320,897,942
=============
Gross unrealized appreciation $ 19,472,366
Gross unrealized depreciation (10,384,186)
-------------
Net unrealized appreciation $ 9,088,180
=============
</TABLE>
At October 31, 1994, the Trust, for federal income tax purposes, had a
capital loss carryforward of $29,271,033, which may be applied against any
net taxable realized gains of each succeeding year until the earlier of its
utilization or expiration on October 31, 1995 ($2,739,150), October 31, 1996
($7,594,152), October 31, 1999 ($1,898,227), October 31, 2000 ($4,765,334),
October 31, 2001 ($3,636,033) and October 31, 2002 ($8,638,137).
(5) Shares of Beneficial Interest
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Trust shares were as follows:
<TABLE>
<CAPTION>
Six Months
Ended April Year Ended
30, October 31,
1995 1994
- ---------------------------------------------------------------- -------------- --------------
<S> <C> <C>
Shares issued to shareholders in reinvestment of distributions 204,648 387,477
============ ============
</TABLE>
(6) Quarterly Financial Information (Unaudited)
<TABLE>
<CAPTION>
Quarterly Period Interest Income Net Investment Income
- ------------------- ------------------------ ------------------------
Per Per
Amount Share Amount Share
------------- ------- ------------- -------
<S> <C> <C> <C> <C>
January 31, 1995 $ 7,475,901 $0.20 $ 6,403,027 $0.17
April 30, 1995 7,483,534 0.20 6,386,559 0.17
----------- ----- ----------- -----
$14,959,435 $0.40 $12,789,586 $0.34
=========== ===== =========== =====
January 31, 1994 $ 6,827,945 $0.19 $ 5,789,070 $0.16
April 30, 1994 7,736,487 0.21 6,576,323 0.18
July 31, 1994 7,552,625 0.20 6,495,294 0.17
October 31, 1994 7,420,241 0.20 6,327,401 0.17
----------- ----- ----------- -----
$29,537,298 $0.80 $25,188,088 $0.68
=========== ===== =========== =====
January 31, 1993 $ 7,496,804 $0.21 $ 6,406,703 $0.18
April 30, 1993 8,603,411 0.25 7,301,981 0.21
July 31, 1993 7,607,856 0.22 6,457,150 0.19
October 31, 1993 7,314,667 0.20 6,211,360 0.17
----------- ----- ----------- -----
$31,022,738 $0.88 $26,377,194 $0.75
=========== ===== =========== =====
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Net Realized
and
Unrealized
Gain (Loss) Net Increase (Decrease)
on in Net Assets Resulting
Quarterly Period Investments from Operations
- -------------------
Per Per
Amount Share Amount Share
------------- ------- ------------- -------
<S> <C> <C> <C> <C>
January 31, 1995 $ (201,711) $(0.01) $ 6,201,316 $0.16
April 30, 1995 5,392,067 0.15 11,778,626 0.32
------------ ------ ----------- -----
$ 5,190,356 $ 0.14 $17,979,942 $0.48
============ ====== =========== =====
January 31, 1994 $ (12,660) $ -- $ 5,776,410 $0.16
April 30, 1994 (5,346,907) (0.14) 1,229,416 0.03
July 31, 1994 (6,503,505) (0.17) (8,211) --
October 31, 1994 1,047,682 0.02 7,375,083 0.20
------------ ------ ----------- -----
$(10,815,390) $(0.29) $14,372,698 $0.39
============ ====== =========== =====
January 31, 1993 $ 6,083,596 $ 0.16 $12,490,299 $0.34
April 30, 1993 1,898,351 0.04 9,200,332 0.25
July 31, 1993 (653,783) (0.03) 5,803,367 0.16
October 31, 1993 1,503,211 0.04 7,714,571 0.21
------------ ------ ----------- -----
$ 8,831,375 $ 0.21 $35,208,569 $0.96
============ ====== =========== =====
</TABLE>
12
<PAGE>
(7) Line of Credit
The Trust entered into an agreement which enables it to participate with
other funds managed by MFS, or an affiliate of MFS, in an unsecured line of
credit with a bank which permits borrowings up to $350 million, collectively.
Borrowings may be made to temporarily finance the repurchase of Trust shares.
Interest is charged to each fund, based on its borrowings, at a rate equal to
the bank's base rate. In addition, a commitment fee, based on the average
daily unused portion of the line of credit, is allocated among the
participating funds at the end of each quarter. The commitment fee allocated
to the Trust for the six months ended April 30, 1995 was $2.548.
(8) Financial Instruments
The Trust also invests in indexed securities whose value may be linked to
foreign currencies, interest rates, commodities, indices or other financial
indicators. Indexed securities are fixed-income securities whose proceeds at
maturity (principal-indexed securities) or interest rates (coupon-indexed
securities) rise and fall according to the change in one or more specified
underlying instruments. Indexed securities may be more volatile than the
underlying instrument itself. The following is a summary of such securities
held at April 30, 1995:
<TABLE>
<CAPTION>
Principal
Amount Unrealized
Description Index (000 Omitted) Value Appreciation
- ----------------------------------- ----------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
Principal-Indexed Securities:
Rochester, MN (Mayo Foundation/Mayo
Medical Foundation), FIRS, 7.34s,
2021 PSA Index $1,000 $1,012,270 $12,270
</TABLE>
(9) Restricted Securities
The Trust may invest not more than 10% of its total assets in securities
which are subject to legal or contractual restrictions on resale. At April
30, 1995, the Trust owned the following restricted securities (constituting
5.11% of net assets) which may not be publicly sold without registration
under the Securities Act of 1933. The Trust does not have the right to demand
that such securities be registered. The value of these securities is
determined by valuations supplied by a pricing service or brokers or, if not
available, in good faith by or at the direction of the Trustees.
<TABLE>
<CAPTION>
Date of Par Amount
Description Acquisition (000 Omitted) Cost Value
- ----------------------------------- ------------- --------------- ----------- --------------
<S> <C> <C> <C> <C>
Broward County, FL, Housing Finance
Authority (Deerfield Beach
Apartments), 13s, 2001 1/14/88 $ 86 $ 89,029 $ 49,451
Cleveland County, OK, Development
Authority (Trails Inn), 12.5s,
2012 7/31/87 9,625 5,098,968 5,101,250
Connecticut Development Authority
(Southington Associates), 10s,
2016 12/22/86 4,425 4,425,000 2,655,000
Crystal City, TX, Lease
Obligations, 10.5s, 2008 5/25/88 4,243 3,217,157 4,052,760
Daphne, AL, Special Care Facilities
Financing Authority
(Westminster Village), 8.25s,
2026 10/28/88 500 500,186 340,000
Downtown Marietta Development
Authority, GA (Marietta Station),
10.25s, 1996 6/09/87 2,166 2,184,076 898,949
Eastern Band of Cherokee Indian
Community, NC (Carolina Mirror
Co.), 11s, 2012 2/05/88 650 601,250 692,022
Hannibal, MO, Industrial
Development Authority
(Hannibal Regional Health Care
System, Inc.), 9.5s, 2022 8/28/92 1,500 2,184,076 1,729,230
Jackson County, IL, First Mortgage
Rev. (Styrest Nursing Home),
9.4s, 2000 5/08/88 60 43,350 6,960
Jackson County, IL, First Mortgage
Rev. (Styrest Nursing Home),
9.5s, 2005 12/05/86 550 494,375 63,800
Jackson County, IL, First Mortgage
Rev. (Styrest Nursing Home),
9.75s, 2010 12/05/86 1,400 1,289,250 162,400
Jackson County, IL, First Mortgage
Rev. (Styrest Nursing Home), 10s,
2016 12/05/86 535 521,450 62,060
Triview, CO, Metropolitan District,
13s, 2004 11/06/87 2,500 2,510,048 1,250,000
-----------
$17,063,882
===========
</TABLE>
13
<PAGE>
Independent Auditors' Report
To the Trustees and Shareholders of MFS Municipal Income Trust:
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of MFS Municipal Income Trust as of
April 30, 1995, the related statement of operations for the six months then
ended, the statement of changes in net assets for the six months then ended
and the year ended October 31, 1994, and the financial highlights for the six
months ended April 30, 1995 and for each of the years in the eight-year
period ended October 31, 1994. These financial statements and financial
highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of the
securities owned at April 30, 1995 by correspondence with the custodian and
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of MFS Municipal
Income Trust at April 30, 1995, the results of its operations, the changes in
its net assets, and its financial highlights for the respective stated
periods in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
June 2, 1995
14
<PAGE>
MFS(R) Municipal
Income Trust
Trustees
A. Keith Brodkin*
Chairman and President
Richard B. Bailey*(2)
Private Investor; Former Chairman and
Director (until 1991), Massachusetts
Financial Services Company
Peter G. Harwood(1)
Private Investor
J. Atwood Ives(1)
Chairman and Chief Executive Officer,
Eastern Enterprises
Lawrence T. Perera(2)
Partner, Hemenway & Barnes
William J. Poorvu(1)
Adjunct Professor, Harvard University
Graduate School of Business
Administration
Charles W. Schmidt(2)
Private Investor;
Former Senior Vice President
and Group Executive (until 1990),
Raytheon Company
Arnold D. Scott*
Senior Executive Vice President
and Secretary,
Massachusetts Financial
Services Company
Jeffrey L. Shames*
President,
Massachusetts Financial
Services Company
Elaine R. Smith(2)
Independent Consultant
David B. Stone(1)(2)
Chairman, North American
Management Corp.
(Investment Advisers)
Portfolio Manager
Cynthia M. Brown*
Treasurer
W. Thomas London*
Assistant Treasurer
James O. Yost*
Secretary
Stephen E. Cavan*
Assistant Secretary
James R. Bordewick, Jr.*
Transfer Agent,
Registrar and Dividend
Disbursing Agent
State Street Bank and
Trust Company
c/o MFS Service Center, Inc.
P.O. Box 9024
Boston, MA 02205-9824
1-800-637-2304
Custodian
State Street Bank and
Trust Company
Auditors
Deloitte & Touche LLP
Investment Adviser
Massachusetts Financial
Services Company
500 Boylston Street
Boston, MA 02116-3741
*Affiliated with the Investment Adviser
(1)Member of Audit Committee
(2)Member of Portfolio Trading Committee
MFMCE-3 6/95 34M
