<PAGE>
TO SHAREHOLDERS
EV Marathon Gold & Natural Resources Fund had a total return of -2.7 percent
during the six months ended March 31, 1995, excluding the Fund's 5 percent
maximum contingent deferred sales charge.
That return reflected a decrease in net asset value from $14.89 per share on
September 30, 1994, to $14.49 per share on March 31, 1995. By comparison, the 34
natural resources funds monitored by Lipper Analytical Services, an independent
mutual fund ranking service, had an average total return of -3.2 percent during
the same period.
The Fund has outperformed the Lipper index during certain longer periods as
well, as will be explained in the interview with the Portfolio Managers later in
this report.
Gold and natural resource stocks were generally weak during the six months
ending March 31, 1995, following a strong performance in the previous six
months. Fears of a recession in 1996 and continuing evidence of low inflation
were responsible for this weakness.
The Fund's goal is to be a hedge against inflation. As such, an investment in
the Fund is particularly valuable at times when there is a threat of increasing
inflationary pressure. Prudent investors recognize that by itself, the Fund is
not a complete investment program and should only be included in a balanced
portfolio. But we believe the wise investor will recognize the importance of
protecting investments against inflation and the loss of purchasing power that
it can cause.
I am pleased to announce a change in the management of the Portfolio. Barclay
Tittmann and William D. Burt have been named Portfolio Managers. Thomas E.
Faust, Jr., who had been the Portfolio Manager, has been promoted to Eaton Vance
Director of Research.
Barclay has more than 20 years of experience as a metals analyst. Bill has
joined Eaton Vance with more than 25 years as a petroleum analyst.We believe
that together, they provide the kind of significant expertise that will be
helpful to the Fund in the future.
Sincerely,
[ Photo of
James B. Hawkes ] /s/ James B. Hawkes
--------------------
James B. Hawkes
President
May 19, 1995
THE FUND'S 10 LARGEST HOLDINGS*
Triton Energy Corp...........Oil, gas exploration
Placer Dome...........................Gold mining
RTZ Corp........................Industrial metals
Barrick Gold Corp.....................Gold mining
Santa Fe Pacific......................Gold mining
Noble Affiliates..........Oil and gas exploration
Firstmiss Gold........................Gold mining
Phillips Petroleum...............Oil, natural gas
Willamette Industries.......................Paper
Freeport McMoRan
Copper & Gold...................Gold, copper
* Holdings based on market value as of March 31, 1995
<PAGE>
MANAGEMENT REPORT
An interview with Barclay Tittmann and William D. Burt, Portfolio Managers of
EV Marathon Gold & Natural Resources Fund.
Q. BARCLAY, HOW WOULD YOU DESCRIBE THE INVESTMENT CLIMATE DURING THE SIX-MONTH
PERIOD THAT ENDED MARCH 31, 1995?
BT: The climate has been distinctly unfavorable for natural resource stocks,
although in the last month of this period there has been some improvement,
particularly in precious metals and some energy stocks.
Q. HOW DO YOU ACCOUNT FOR THE POOR ENVIRONMENT?
BT: Basically, investors last fall became convinced that the economy was
weakening and might even go into a recession by 1996. This is tough on
natural resource stocks, which, of course, are cyclical. However, investors
tend to forget that the cycle for natural resources is the world economy,
not just that of the United States, and the world economic cycle is only now
beginning to turn up.
WB: In the energy sector, gas stocks were generally weak because of sharp
declines in natural gas prices. In fact, by February you could say that the
market was discounting the worst, setting the stocks up nicely for a turn.
Q. WHAT DID YOU DO TO TAKE ADVANTAGE OF THIS?
WB: We bought natural gas-oriented companies and a number of oil companies as
well. These were issues that had been out of favor for at least a half-year,
and we were able to buy them at cheap prices.
TAKING ADVANTAGE OF CHANGING CONDITIONS, THE PORTFOLIO MOVED
MORE HEAVILY INTO OIL AND GAS STOCKS.
This is a bar chart, entitled, "Taking advantage of changing
conditions, the Portfolio moved more heavily into oil and gas stocks."
The chart shows a series of pairs of columns. Each pair represents the
Portfolio's investment in a given sector as of two dates, September
30, 1994 and March 31, 1995. The numerical values for each column are
listed above it. There is a legend below the columns that shows the
colors of the two bars and the dates with which they correspond. The
values of the columns are:
Gold and precious metals: Sept. 30, 27.1% of the Portfolio; March 31,
25.3%; Paper and forest products: Sept. 30, 20.3%; March 31, 14.5%;
Oil and gas: Sept. 30, 17.7%, March 31, 28.5%; Industrial metals:
Sept. 30, 18%, March 31, 18.1%; Industrial minerals: Sept. 30, 9.2%,
March 31, 6.4%; and Iron and steel: Sept. 30, 7.7%, March 31, 7.2%.
<PAGE>
Q. WHAT OTHER SECTOR MOVES DID YOU MAKE DURING THE SIX-MONTH PERIOD?
WB: We trimmed the paper stocks, which had been a [Photo of
big position in the Portfolio. Our sales WILLIAM D. BURT]
focused on forest products, which are more
sensitive to the construction industry cycle.
We retained the pure paper stocks, which have
a better outlook.
Q. ARE YOU LOOKING FOR A BALANCE AMONG SECTORS?
BT: It depends on the relative attractiveness of each sector at any given
moment. Right now, for example, we have roughly equal weightings in precious
metals and energy, whereas six months earlier, we were underweighted in
energy.
WB: If you make heavy bets on only one or two sectors, you're going to be
spectacularly successful some of the time and spectacularly unsuccessful at
others. For consistent performance, you have to shift positions judiciously
among sectors, and you have to pick the right stocks within the sectors.
Q. HOW HAS THE FUND'S INVESTMENT TECHNIQUE AFFECTED ITS PERFORMANCE?
BT: Over the long term, the Fund has outperformed a group of similar funds,
"Natural Resource Funds," as measured by Lipper Analytical Services, an
independent fund ranking service. For the year ending March 31, 1995, the
Fund had a total return of 10.0 percent, while the total return for the
29-fund index was 4.7 percent. For five years, the Fund's annualized total
return was 5.9 percent, while the index, comprising 19 funds at that time,
was 3.9 percent. Since its inception date of October 21, 1987, the Fund has
had an annualized total return of 9.3 percent, compared to 8.2 percent for
the index, which at that time comprised 13 funds. All Fund results exclude
the maximum sales charge.* Of course, past performance is no guarantee of
future results. Investment returns and principal will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
Q. What stock in the Portfolio has been the best performer during this period?
WB: Triton Energy Corp., our largest holding. Oil [Photo of
exploration companies need two attributes -- a BARCLAY TITTMANN]
strong technical staff and good luck -- to be
successful, and this company has both.
Triton's growth is fueled by its explorations
for oil in Colombia and for natural gas in
Thailand. The company found a great deal of
oil in Colombia three years ago and has been
developing it ever since. The market
recognizes that the cash flow payoff is
approaching and the stock's value is rising
accordingly.
* The Fund's average annual total return including applicable contingent
deferred sales charge is as follows: One year: 5.0 percent; 5 years: 5.6
percent, since inception on 10/21/87: 9.3 percent annualized.
<PAGE>
BT: For every billion barrels of oil in the Colombia oil find there's about $12
of value in Triton. The stock price currently reflects about 3 billion
barrels, but there could easily be 4 to 5 billion, so there's great upside
potential.
WB: The other part of the story behind the company is financial. Wall Street
once feared that Triton would have to make a secondary offering of stock to
finance its activities while it waited for cash flow to materialize. It now
appears that the company won't need to take this action.
Q. WHAT OTHER HOLDINGS ARE PARTICULARLY NOTEWORTHY?
BT: Placer Dome Inc. is the Portfolio's second-largest holding. It's a major
Canadian-based gold mining company that recently made a very interesting
acquisition, International Musto, an Argentinian mining company with large
gold and copper reserves. Placer Dome already has one of the largest gold
reserves of any company in North America, and this acquisition strengthens
it further.
Q. WHAT'S THE LONG-TERM OUTLOOK FOR NATURAL RESOURCE INVESTMENTS?
BT: In general, the last 10 years have not been very rewarding for natural
resource investors. This is because a combination of overcapacity at the
beginning of the decade and worldwide recession at the end of the decade
have kept a lid on commodity prices, which are now below what they were 10
years ago in real terms. I think the opposite is likely to happen during the
next 10 years because of the tremendous growth in the economies of the
emerging world (particularly Asia). This is likely to increase the growth
rate of such commodities as copper, aluminum, steel and paper.
WB: I agree. I think even oil will be favorably affected by the increasing
demand from the emerging economies.
BT: And of course, a gold and natural resources fund may be an effective hedge
against inflation and should have a place in a prudent investor's portfolio
for that purpose.
STRONG EMERGING MARKETS ARE
LIKELY TO CREATE STRONG NATURAL
RESOURCE DEMAND.
This chart is entitled. "Strong emerging markets are likely to create
strong natural resource demand." It consists of a series of pairs of
columns showing Annual real (inflation-adjusted) GDP growth rates, and
labeled as such, for five years, 1991 through 1995. The 1995 figures
are estimates and are labeled as such. Below the bars is a legend
showing the colors of the bars and the types of economies that they
represent. The values for each year are:
1991: Developed countries, 0.8%, Emerging markets, 4.4%; 1992:
Developed countries, 1.7%, Emerging markets, 5.9%; 1993: Developed
countries, 1.1%, Emerging markets, 6.1%; 1994: Developed countries,
2.1%, Emerging markets, 5.5%; 1995 (est.): Developed countries, 2.7%,
Emerging markets, 5.8%.
At the bottom of the chart is a disclaimer, "Past performance is
guarantee of future results," and a listing of the sources of the
material in the chart, the International Monetary Fund, Organization
for Economic Cooperation and Development.
<PAGE>
- --------------------------------------------------------------------------
EV MARATHON GOLD & NATURAL
RESOURCES FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1995
(UNAUDITED)
- --------------------------------------------------------------------------
COMMON STOCKS - 96.1%
- --------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------
GOLD & PRECIOUS METALS - 24.3%
Ashanti Goldfields Ltd. GDR 12,000 $ 292,500
Battle Mountain Gold Co. 24,000 288,000
Barrick Gold Corp.+ 17,000 425,000
Dayton Mining Corp.+ 55,000 160,754
Firstmiss Gold, Inc.* 40,000 400,000
Hecla Mining Co. 25,000 287,500
Newmont Mining Corp. 6,237 266,631
Placer Dome, Inc.+ 19,000 463,125
Santa Fe Pacific Gold Corp. 33,000 416,625
TVX Gold, Inc.*+ 45,000 298,125
-----------
$ 3,298,260
-----------
INDUSTRIAL METALS - 17.4%
Aluminum Co. of America 2,600 $ 107,575
ASARCO Inc. 10,000 263,750
Commonwealth Aluminum Corp. 12,000 168,000
Cyprus Amax Minerals Co. 12,500 354,688
Freeport McMoRan Copper & Gold 16,300 356,562
Inco Limited+ 5,600 156,100
Phelps Dodge Corp. 4,700 267,312
Reynolds Metals Co. 5,000 246,250
RTZ Corp. PLC ADR+ 8,424 438,048
-----------
$ 2,358,285
-----------
INDUSTRIAL MINERALS - 6.1%
Minerals Technologies, Inc. 10,500 $ 338,625
National Gypsum Co. 4,500 226,125
Potash Corp. of Saskatchewan+ 6,000 267,000
-----------
$ 831,750
-----------
IRON & STEEL - 6.9%
Geneva Steel Company Class A 15,000 $ 178,125
J & L Specialty Steel, Inc.* 16,000 318,000
Lukens Inc. 4,000 122,000
Rouge Steel Company Class A 13,000 318,500
-----------
$ 936,625
-----------
OIL & GAS - 27.4%
Amerada Hess Corp. 2,000 $ 98,750
Anadarko Petroleum Corp. 8,000 350,000
Apache Corp. 12,000 327,000
Arakis Energy Corp.*+ 35,000 251,563
Burlington Resources, Inc. 3,000 122,250
Cabot Oil & Gas Corp. 13,000 203,125
Mobil Corp. 1,500 138,937
<PAGE>
PORTFOLIO OF INVESTMENTS (Continued)
- --------------------------------------------------------------------------
COMMON STOCKS (Continued)
- --------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------
OIL & GAS (Continued)
Noble Affiliates, Inc. 15,000 $ 410,625
Phillips Petroleum Co. 10,100 369,913
Plains Resources, Inc. 17,000 131,750
Royal Dutch Petroleum PLC ADR 1,800 216,000
Triton Energy Corp. 14,000 535,500
Unocal Corp. 8,500 244,375
Western Co. of North America 15,000 315,000
-----------
$ 3,714,788
-----------
PAPER & FOREST PRODUCTS - 14.0%
International Paper Co. 1,300 $ 97,663
Jefferson Smurfit Corp. 20,000 322,500
Mead Corporation 3,300 176,963
Pacific Forest Products*+ 10,000 86,437
Rayonier Inc.* 5,000 155,625
Temple Inland Inc. 6,500 291,687
Timberwest Forest Ltd.*+ 18,000 170,022
Weyerhaeuser Co. 6,100 237,138
Willamette Inds Inc. 6,600 359,700
-----------
$ 1,897,735
-----------
TOTAL COMMON STOCKS
(Identified cost, $11,377,090) $13,037,443
- --------------------------------------------------------------------------
PREFERRED STOCKS - 3.6%
- --------------------------------------------------------------------------
Amax Gold, Inc., Conv. Pfd. 5,000 $ 245,000
Freeport McMoRan Copper & Gold, Inc. Var. Pfd. 7,000 241,500
-----------
TOTAL PREFERRED STOCKS
(Identified cost, $528,670) $ 486,500
-----------
TOTAL INVESTMENTS
(Identified cost, $11,905,760) $13,523,943
OTHER ASSETS, LESS LIABILITIES - 0.3% 45,625
-----------
NET ASSETS - 100% $13,569,568
===========
*Non-income producing security.
+Foreign Security.
See notes to financial statements
<PAGE>
EV MARATHON GOLD & NATURAL RESOURCES FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
March 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
ASSETS:
Investments, at value (Note 1A) (identified cost,
$11,905,760) $13,523,943
Cash 705
Receivable for investments sold 122,276
Receivable for Trust shares sold 76,608
Dividends receivable 14,547
-----------
Total assets $13,738,079
LIABILITIES:
Due to bank $ 14,000
Payable for Trust shares redeemed 149,105
Payable to affiliates --
Custodian fee 100
Trustees' fees 45
Accrued expenses 5,261
--------
Total liabilities 168,511
-----------
NET ASSETS for 936,209 shares of beneficial interest
outstanding $13,569,568
===========
SOURCES OF NET ASSETS:
Paid-in capital $11,964,658
Accumulated net realized gain on investment
transactions 1,963
Net investment loss (15,236)
Unrealized appreciation of investments (computed on
the basis of identified cost) 1,618,183
-----------
Total $13,569,568
===========
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE (NOTE 6)
PER SHARE ($13,569,568 / 936,209 shares of beneficial interest) $14.49
======
See notes to financial statements
<PAGE>
PORTFOLIO OF INVESTMENTS (Continued)
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Six Months Ended March 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Income --
Dividends (less withholding taxes of $2,270) $ 107,694
Interest 13,144
---------
Total income $ 120,838
Expenses --
Investment adviser fee (Note 4) $ 48,165
Compensation of Trustees not members of the
Investment Adviser's organization 81
Custodian fee (Note 4) 4,171
Distribution fees (Note 5) 54,062
Registration costs 10,643
Printing and postage 8,002
Legal and accounting services 12,505
Transfer and dividend disbursing agent fees 6,568
Miscellaneous 4,129
---------
Total expenses 148,326
---------
Net investment loss $ (27,488)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments, computed on the
basis of identified cost $ 63,188
Decrease in unrealized appreciation of investments (375,066)
---------
Net realized and unrealized loss on
investments (311,878)
---------
Net decrease in net assets from operations $(339,366)
=========
See notes to financial statements
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994
-------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment loss $ (27,488) $ (89,807)
Net realized gain (loss) on investments 63,188 (61,225)
Increase (decrease) in unrealized appreciation
of investments (375,066) 1,765,546
----------- -----------
Net increase (decrease) in net assets from
operations $ (339,366) $ 1,614,514
----------- -----------
Distributions to shareholders from (Note 2) --
In excess of net investment income $ -- $ (10,924)
In excess of net realized gain on investment
transactions -- (508,281)
----------- -----------
Total $ -- $ (519,205)
----------- -----------
Transactions in shares of beneficial interest
(exclusive of amounts allocated to
net investment income) (Note 3) --
Proceeds from sales of shares $ 2,502,217 $10,163,553
Net asset value of shares issued to
shareholder in payment of distributions
declared -- 378,380
Cost of shares redeemed (1,648,598) (4,374,063)
----------- -----------
Increase in net assets from Trust share
transactions $ 853,619 $ 6,167,870
----------- -----------
Net increase in net assets $ 514,253 $ 7,263,179
NET ASSETS:
At beginning of year 13,055,315 5,792,136
----------- -----------
At end of year $13,569,568 $13,055,315
=========== ===========
See notes to financial statements
<PAGE>
FINANCIAL STATEMENTS (Continued)
<TABLE>
FINANCIAL HIGHLIGHTS
- ----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED SEPTEMBER 30,
MARCH 31, 1995 -------------------------------------------------------------------
(UNAUDITED) 1994 1993 1992 1991 1990
----------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, beginning of year $14.890 $13.240 $11.850 $11.140 $12.140 $13.460
------- ------- ------- ------- ------- -------
INCOME FROM OPERATIONS:
Net investment income (loss) $(0.016) $(0.050) $(0.090) $(0.083) $ 0.020 $ 0.069
Net realized and unrealized gain (loss)
on investments (0.384) 2.650 1.480 1.103 (0.570) (0.009)
------- ------- ------- ------- ------- -------
Total income from investment operations $(0.400) $ 2.600 $ 1.390 $ 1.020 $(0.550) $ 0.060
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS FROM:
Net investment income $ -- $ -- $ -- $ -- $(0.020) $(0.069)
Net realized gain on investments -- -- -- (0.060) (0.320) (1.220)
Paid-in capital -- -- -- (0.250) (0.110) (0.091)
In excess of net investment income -- (0.020) -- -- -- --
In excess of realized gain on investment -- (0.930) -- -- -- --
------- ------- ------- ------- ------- -------
Total distributions $ -- $(0.950) $ -- $(0.310) $(0.450) $(1.380)
------- ------- ------- ------- ------- -------
NET ASSET VALUE, end of year $14.490 $14.890 $13.240 $11.850 $11.140 $12.140
======= ======= ======= ======= ======= =======
TOTAL RETURN (2.69)% 20.47% 11.73% 9.44% (4.36)% 0.01%
RATIOS/SUPPLEMENTAL DATA:<F1>
Net assets, end of year (000's omitted) $13,570 $13,055 $ 5,792 $ 3,775 $ 4,042 $4,391
Ratio of net expenses to average net assets 2.31%<F2> 2.64% 3.15% 3.26% 3.29% 2.50%
Ratio of net investment income (loss) to
average net assets (0.43)%<F2> (0.96)% (0.92)% (0.67)% 0.17% 0.33%
PORTFOLIO TURNOVER 13% 17% 57% 32% 27% 35%
<FN>
<F1> For the four years ended September 30, 1993, the operating expenses of the
Trust reflect a reduction of the investment adviser fee, an allocation of
expenses to the Investment Adviser, or both. Had such actions not been
taken, net investment income per share and the ratios would have been as
follows:
NET INVESTMENT INCOME (LOSS) PER SHARE $(0.210) $(0.240) $(0.110) $(0.300)
======= ======= ======= =======
RATIOS (As a percentage of average net assets):
Expenses 3.90% 5.23% 4.42% 5.23%
Net investment income (loss) (1.67)% (2.06)% (0.96)% (2.40)%
<F2> Annualized
</FN>
</TABLE>
See notes to financial statements
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) SIGNIFICANT ACCOUNTING POLICIES
The Trust is an entity of the type commonly known as a Massachusetts business
trust and 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 consistently followed by the Trust in
the preparation of its financial statements. The policies are in conformity with
generally accepted accounting principles.
A. INVESTMENT VALUATIONS -- Investments, other than fixed income securities,
listed on securities exchanges or in the NASDAQ National Market System are
valued at closing sale prices. Unlisted securities or listed securities for
which closing sale prices are not available are valued at the mean between the
latest bid and asked prices.Options are valued at the last quoted sale price on
the exchange or board of trade on which they are primarily traded or, in the
absence of a sale, the mean between the last bid and asked price. Futures
positions on investments or currencies are generally valued at closing
settlement prices. Short-term obligations are valued at amortized cost, which
approximates value. Other fixed income and debt securities, including listed
securities and securities for which price quotations are available, will
normally be valued on the basis of valuations furnished by a pricing service.
All other securities are appraised at fair value as determined in good faith by
or pursuant to procedures established by the Trustees.
B. FEDERAL TAXES -- The Trust's policy is to comply with the provisions of the
Internal Revenue Code available to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments. Accordingly, no provision for federal income
or excise tax is necessary. At September 30, 1994, the Trust, for federal income
tax purposes, had a capital loss carryover of $61,225 which will reduce the
Trust's taxable income arising from future net realized gain on investments, if
any, to the extent permitted by the Internal Revenue Code, and thus will reduce
the amount of the distributions to shareholders which would otherwise be
necessary to relieve the Trust of any liability for federal income or excise
tax. Such capital loss carryovers will expire on September 30, 2002.
C. DISTRIBUTION COSTS -- For book purposes, commissions paid on the sale of
Trust shares and other distribution costs are charged to operations. For tax
purposes, commissions paid were charged to paid-in capital prior to November 16,
1994 and subsequently charged to operations. The change in the tax accounting
practice was prompted by a recent Internal Revenue Service ruling and has no
effect on either the Trust's current yield or total return (Note 5).
D. OTHER -- Investment security transactions are accounted for on a trade date
basis. Dividend income, distributions to shareholders and shares issued to
shareholders electing to receive distributions in shares are recorded on the
ex-dividend date.
E. INTERIM FINANCIAL INFORMATION -- The interim financial statements relating to
March 31, 1995 and for the six-month period then ended have not been audited by
independent certified public accountants, but in the opinion of the Trust's
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for fair presentation of the financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
(2) DISTRIBUTIONS TO SHAREHOLDERS
It is the present policy of the Trust to make (A) at least one distribution
annually (normally in December) of substantially all of the investment income
earned by the Trust, less its expenses (other than sales commissions incurred in
the sale of Trust shares, which commissions are charged to the Trust's paid-in
capital for tax purposes), and (B) at least one distribution annually of
substantially all of the capital gains realized by the Trust, if any.
Distributions are paid in the form of additional shares of the Trust or, at the
election of the shareholder, in cash. The Trust distinguishes between
distributions on a tax basis and a financial reporting basis. Generally accepted
accounting principles require that only distributions in excess of tax basis
earnings and profits be reported in the financial statements as a return of
capital. Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in
overdistributions only for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains. Permanent differences between book and tax accounting relating to
distributions are reclassified to paid in capital.
- --------------------------------------------------------------------------------
(3) SHARES OF BENEFICIAL INTEREST
The 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:
SIX MONTHS
ENDED YEAR ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994
-------------- -------------
Sales 181,002 731,556
Issued to shareholders electing to receive
payment of distribution in Trust shares -- 28,365
Redemptions (121,675) (320,555)
-------- --------
Net increase 59,327 439,366
======== ========
- --------------------------------------------------------------------------------
(4) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee was paid to Eaton Vance Management (EVM) as
compensation for management and investment advisory services rendered to the
Trust. The fee is computed at the monthly rate of 0.0625% (0.75% per annum) of
the Trust's average daily net assets up to $500 million and at reduced rates as
daily net assets exceed that level. For the six months ended March 31, 1995, the
effective annual rate, based on average daily net assets, was 0.75%.
Except as to Trustees of the Trust who are not members of EVM's organization,
officers and Trustees receive remuneration for their services to the Trust out
of such investment adviser fee. Investors Bank & Trust Company (IBT), an
affiliate of EVM, serves as custodian of the Trust. Pursuant to the custodian
agreement, IBT receives a fee reduced by credits which are determined based on
the average daily cash balances the Trust maintains with IBT. Certain of the
officers and Trustees of the Trust are officers and directors/trustees of the
above organizations (See Note 5).
Trustees of the Portfolio that are not affiliated with the Investment Advisor
may elect to defer receipt of all or a percentage of their annual fees in
accordance with the terms of the Trustees Deferred Compensation Plan. For the
six months ended March 31, 1995, no significant amounts have been deferred.
<PAGE>
- --------------------------------------------------------------------------------
(5) DISTRIBUTION PLAN
The Trust has adopted a distribution plan pursuant to Rule 12b-1 under the
Investment Company Act of 1940. The Plan requires the Trust to pay the Principal
Underwriter, Eaton Vance Distributors, Inc. (EVD) amounts equal to 1/365 of
0.75% of the Trust's daily net assets, for providing ongoing distribution
services and facilities to the Trust. The Trust will automatically discontinue
payments to EVD during any period in which there are no outstanding Uncovered
Distribution Charges, which are equivalent to the sum of (i) 5% of the aggregate
amount received by the Trust for shares sold plus (ii) distribution fees
calculated by applying the rate of 1% over the prevailing prime rate to the
outstanding balance of Uncovered Distribution Charges of EVD, reduced by the
aggregate amount of contingent deferred sales charges (see Note 6) and daily
amounts theretofore paid to EVD. The amount payable to EVD with respect to each
day is accrued on such day as a liability of the Trust and, accordingly, reduces
the Trust's net assets. The Trust accrued $48,056 as payable to EVD for the year
ended March 31, 1995, representing 0.75% (annualized) of daily average net
assets. At March 31, 1995, the amount of Uncovered Distribution Charges of EVD
calculated under the Plan was approximately $457,581.
In addition, the Plan authorizes the Trust to make payments of service fees to
the Principal Underwriter, Authorized Firms and other persons in amounts not
exceeding 0.25% of the Trust's average daily net assets for each fiscal year.
The Trustees have initially implemented the Plan by authorizing the Trust to
make quarterly payments of service fees to the Principal Underwriter and
Authorized Firms in amounts not expected to exceed 0.25% per annum of the
Trust's average daily net assets based on the value of Trust shares sold by such
persons and remaining outstanding for at least one year. Service fee payments
will be made for personal services and/or the maintenance of shareholder
accounts. Service fees are separate and distinct from the sales commissions and
distribution fees payable by the Trust to EVD, and, as such, are not subject to
automatic discontinuance where there are no outstanding Uncovered Distribution
Charges of EVD. Provision for service fees payments amounted to $6,006 for the
year ended March 31, 1995.
Certain officers and Trustees of the Trust are officers or directors of EVD.
- --------------------------------------------------------------------------------
(6) CONTINGENT DEFERRED SALES CHARGE
A contingent deferred sales charge (CDSC) is imposed on any redemption of Trust
shares made within six years of purchase. Generally, the CDSC is based upon the
lower of net asset value at date of redemption or date of purchase. No charge is
levied on shares acquired by reinvesetment of dividends or capital gain
distributions. The CDSC is imposed at declining rates that begin at 5% in the
case of redemptions in the first and second year after purchase (6% and 5%,
respectively for shares acquired prior to August 1, 1994), declining one
percentage point each year. No CDSC is levied on shares which have been sold to
EVM or its affiliates or to their respective employees or clients. CDSC charges
are paid to EVD to reduce the amount of Uncovered Distribution Charges
calculated under the Trust's Distribution Plan. If no Uncovered Distribution
Charges exist, the CDSC will be credited to operations. EVD received
approximately $24,176 of CDSC paid by shareholders for the six months ended
March 31, 1995.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
(7) LINE OF CREDIT
The Trust participates with other funds managed by EVM in a $120 million
unsecured line of credit aggrement with a bank. The line of credit consists of a
$20 million committed facility and a $100 million discretionary facility.
Borrowings will be made by the Trust solely to facilitate the handling of
unusual and/or unanticipated short-term cash requirements. Interest is charged
to each fund based on its borrowings at an amount above either the bank's
adjusted certificate of deposit rate, a variable adjusted certificate of deposit
rate, or a federal funds effective rate. In addition, a fee computed at an
annual rate of 1/4 of 1% on the $20 million committed facility and on the daily
unused portion of the $100 million discretionary facility is allocated among the
participating funds at the end of each quarter. The Trust did not have any
significant borrowings or allocated fees during the period.
- --------------------------------------------------------------------------------
(8) PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of investments, other than short-term obligations,
aggregated $3,009,253 and $1,571,699, respectively.
- --------------------------------------------------------------------------------
(9) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investment
securities owned at March 31, 1995, as computed on a federal income tax basis,
are as follows:
Aggregate cost $11,905,760
===========
Gross unrealized appreciation $ 2,063,458
Gross unrealized depreciation 445,275
-----------
Net unrealized appreciation $ 1,618,183
===========
<PAGE>
INVESTMENT MANAGEMENT
EV MARATHON OFFICERS INDEPENDENT TRUSTEES
GOLD & NATURAL JAMES B. HAWKES DONALD R. DWIGHT
RESOURCES FUND President, Trustee President, Dwight Partners, Inc.
24 Federal Street Chairman, Newspapers of
Boston, MA 02110 LANDON T. CLAY New England, Inc.
Vice President, Trustee
SAMUEL L. HAYES, III
THOMAS E. FAUST, JR. Jacob H. Schiff Professor of
Vice President Investment Banking,
Harvard University
WILLIAM D. BURT Graduate School of
Co-Portfolio Manager Business Administration
BARCLAY TITTMANN NORTON H. REAMER
Co-Portfolio Manager President, United Asset
Management Corporation
JAMES L. O'CONNOR
Treasurer JOHN L. THORNDIKE
Director,
THOMAS OTIS Fiduciary Company Incorporated
Secretary
JACK L. TREYNOR
WILLIAM J. AUSTIN, JR. Investment Adviser and Consultant
Assistant Treasurer
JANET E. SANDERS
Assistant Treasurer and
Assistant Secretary
A. JOHN MURPHY
Assistant Secretary
CO-PORTFOLIO MANAGERS
William D. Burt
Barclay Tittmann
<PAGE>
ADMINISTRATOR OF
EV MARATHON GOLD &
NATURAL RESOURCES FUND
Eaton Vance Management
24 Federal Street
Boston, MA 02110
PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
CUSTODIAN
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110
TRANSFER AGENT
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
INDEPENDENT AUDITORS
Deloitte & Touche LLP
125 Summer Street
Boston, MA 02110
This report must be preceded or
accompanied by a current prospectus
which contains more complete information
on the Fund, including its distribution
plan, sales charges and expenses. Please
read the prospectus carefully before you
invest or send money.
EV MARATHON
GOLD & NATURAL RESOURCES FUND
24 Federal Street
Boston, MA 02110
M-NRSRC
EV MARATHON
GOLD & NATURAL
RESOURCES FUND
SEMI-ANNUAL
SHAREHOLDER REPORT
MARCH 31, 1995
