<PAGE>
TO SHAREHOLDERS
EV Marathon Gold & Natural Resources Fund had a total return of 10.3% during
the 11 months ended August 31, 1995, excluding the Fund's 5% maximum
contingent deferred sales charge.
That return reflects an increase in net asset value from $14.89 per share on
September 30, 1994 to $16.42 on August 31, 1995. By comparison, the S&P 500,
an unmanaged index of common stocks, had a total return of 24.4% for the same
period.
The 34 natural resource funds monitored by Lipper Analytical Services, an
independent mutual fund monitoring service, had an average total return of
5.4%, significantly less than the Fund's return of 10.3% during that same
period, according to a computation by Eaton Vance based on the Lipper
statistics.
The Fund has outperformed the Lipper index during certain longer periods as
well, as is explained in the interview with the Portfolio Managers later in
this report.
This report covers an 11-month fiscal year because the end of the Fund's
fiscal year has been changed from September 30 to August 31. Effective August
31, 1995, the Fund became a series of the Eaton Vance Growth Trust.
We believe that worldwide economic conditions, particularly the strong growth
demonstrated by developing nations, is creating demand for the materials
produced by the sectors in which the Portfolio invests. Further, we believe
that this strong demand should continue even during any slowdown of the
global economy that might occur.
The Fund expects to continue to work to fulfill its goal as a hedge against
inflation. Having such a hedge in a shareholder's portfolio of financial
assets is particularly useful in case of an upward trend
in inflation.
By itself, the Fund does not constitute a complete investment program and
should only be included as part of a balanced portfolio. But we believe
prudent investors may well see the wisdom in seeking protection against the
loss of purchasing power that inflation could cause.
Sincerely,
[PHOTO OF JAMES B. HAWKES]
/s/James B. Hawkes
President
October 4, 1995
- -------------------------------------------------------------------------------
THE FUND'S 10 LARGEST HOLDINGS*
- -------------------------------------------------------------------------------
Firstmiss Gold, Inc...............................Gold mining
Triton Energy Corp................................Oil exploration
Anadarko Petroleum Corp...........................Oil, natural gas
ASARCO, Inc.......................................Copper
RTZ Corp., PLC ADR ...............................Copper, other minerals
Barrick Gold Corp.................................Gold
Noble Affiliates Inc..............................Oil, natural gas
Dayton Mining Corp................................Gold
J&L Specialty Steel...............................Iron and steel
Santa Fe Pacific Gold Corp........................Gold
* The holdings above represented 34.0% of the Portfolio's investments by
market value as of August 31, 1995
MANAGEMENT REPORT
An interview with Barclay Tittmann and William D. Burt, Portfolio Managers of
EV Marathon Gold & Natural Resources Fund.
Q. BARCLAY, WHAT CONTRIBUTED TO THE FUND'S POSITIVE PERFORMANCE DURING THE 11
MONTHS ENDED AUGUST 31, 1995?
BT: We had good performance relative to other natural resource funds, primarily
because we have a significant exposure to smaller companies with good
exploration potential. Some of these have done very well in the last 11
months.
Q. CAN YOU GIVE AN EXAMPLE?
BT: A good example is FirstMiss Gold, Inc. It is a relatively unknown mining
company that is 80% owned by First Mississippi Corp., a fertilizer company.
We've had the stock for about a year and a half, and I'm happy to report
that the price is up sharply based on very favorable news.
FirstMiss, which operates the old Getchell Mine in Nevada, has found a major
gold deposit right next door. The new mine, called Turquoise Ridge, has
proven reserves of around 2 million ounces, but it could be a lot larger
than that.
This is the kind of find called a "company maker;" it can turn a junior
producer into a senior producer, just as American Barrick, now called
Barrick Gold Corp. evolved into a major gold producer after discovering the
Goldstrike Mine, which also is in Nevada.
This is a bar chart, entitled, "EV Marathon Gold & Natural Resources: A
Portfolio whose weightings are adjusted to meet changing investment conditions."
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
August 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; August 31, 27.2%;
Paper and forest products, Sept. 30, 20.3%; August 31, 5.5%; Oil and gas, Sept.
30, 17.7%, August 31, 23.7%; Industrial metals, Sept. 30, 18%, August 31, 21.7%;
Industrial minerals and fertilizer, Sept. 30, 9.2%, August 31, 10.5%; and Iron
and steel, Sept. 30, 7.7%, August 31, 6.2%.
[PHOTO OF BARCLAY TITTMANN]
Q. BILL, HAVE ANY OF THE PORTFOLIO'S PETROLEUM STOCKS PERFORMED PARTICULARLY
WELL?
WB: We continue to be pleased with the results of Triton Energy Corp. The rise
in Triton's stock price is being driven by the company's successful
explorations for oil in Colombia and for natural gas in Thailand. Triton
should be generating significant cash flow in the future and the stock's
value is rising accordingly. Of course, past trends cannot guarantee future
performance.
Q. ARE THERE OTHER INTERESTING PETROLEUM EXPLORATION COMPANIES AMONG THE
PORTFOLIO'S HOLDINGS?
WB: Anadarko Petroleum Corp. is a stock that we've held for some time but have
added to during the last 11 months. Anadarko has done well because the
company's exploration for oil in Algeria continues to be an outstanding
success.
To give you an idea of the magnitude of these discoveries, full development
of what they've found in Algeria may exceed the company's current earnings
and cash flow.
Year-to-date natural gas prices have been weak, so the company's earnings
and cash flow have been weaker than expected, but the market has been
willing to look past this factor because of the positive implications of
recent natural gas price increases, as well as the company's other
potentials.
What's more, the Algerian operation is overshadowing Anadarko's explorations
in Mexico. But we believe the company's Gulf of Mexico explorations will be
increased in 1995 and will provide further good news for shareholders.
[PHOTO OF WILLIAM D. BURT]
Q. APART FROM INDIVIDUAL COMPANY SUCCESS STORIES, HAVE THERE BEEN ANY TRENDS
AFFECTING WHOLE SECTORS?
WB: Yes. One trend that we've made an effort to exploit has been the fluctuation
of commodity prices. We've tried to buy exposure to specific commodities at
inexpensive prices when they fall deeply out of favor.
Q. CAN YOU GIVE AN EXAMPLE OF HOW THAT PROCESS WORKS?
WB: A good example is natural gas. Prices for this commodity had been depressed
for a year. But during this summer, a long enough stretch of hot, humid
weather over much of the country caused a strong demand for air
conditioning.
The resulting increase in demand for electricity, plus other sources of
natural gas demand, combined to raise spot and contract prices and have
driven up natural gas stock prices. The Portfolio is benefiting because we
bought some of these stocks, such as Apache Corp. and Noble Affiliates,
Inc., at relatively inexpensive prices.
Q. BARCLAY, ARE THERE OTHER SECTOR TRENDS WITHIN THE GOLD AND NATURAL RESOURCES
AREA?
This chart is entitled, "Continued strong emerging markets are likely to create
robust demand for natural resources."
It consists of a series of pairs of columns showing Annual real (inflation-
adjusted) GDP growth rates, and labeled as such, for five year, 1991 through
1995. The 1995 figures are estimates and are labeled as such. Above the bars is
a legend showing the colors of the bars and the types of economies that they
represent, emerging markets and developed countries. 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%;
and 1995 (est.), Developed countries, 2.7%, Emerging markets, 5.8%.
At the bottom of the chart is a disclaimer, "Past performance is no 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.
BT. There is what we believe to be an overall trend that drives natural resource
investments. We have a strong conviction that natural resources on a global
basis are going to benefit from the growth of emerging countries,
particularly those in Asia.
We believe that even if there is a worldwide economic slowdown, as there
almost certainly will be at some point, commodity prices will not drop to
the low levels that were seen in the 1980s. This is because emerging market
demand may continue to keep commodity prices relatively high.
Fertilizer is a good example of this phenomenon. Asian demand, primarily
from China and India, is keeping world fertilizer prices strong, to the
benefit of Canadian and U.S. producers. Incidentally, we have about 10% of
the Portfolio in fertilizer stocks.
Q. WHAT OTHER HOLDINGS ARE PARTICULARLY NOTEWORTHY?
BT: One that is particularly interesting is a Canadian company called Diamond
Fields Resources. A year ago, Diamond Fields discovered a huge, high grade
deposit containing nickel, copper and cobalt, at Voisey Bay,Newfoundland.
There probably are 100 million tons of ore, and only 11% of the area has
been explored!
The company has two big-league partners, INCO and Teck Canada. A big plus
for this find is its location right on the water, so transportation out of
Newfoundland should not be particularly costly.
Q. HOW HAS THE FUND'S PERFORMANCE FARED OVER THE LONG TERM?
BT. Over a variety of periods, the Fund has outperformed a group of similar,
"Natural Resource Funds," as supplied by Lipper Analytical Services, an
independent fund ranking service. Lipper defines natural resource funds as
those that invest more than 65% of their equity commitment in natural
resource stocks.
For example, for the 12 months ended August 31, 1995, the Fund's total
return of 13.8% ranked it second out of 33 funds in its category. The
average total return of those funds was 6.3%.
For the five years ended August 31, 1995, the Fund's total annualized return
of 8.5% ranked third out of 19 funds in its category, and the average total
return of the 19 funds was 8.44%.
All Fund results exclude the maximum sales charge. The Fund's average annual
total return, including the applicable contingent deferred sales charge, is
as follows: 11 months: 5.3%; 1 year: 8.8%; 5 years: 8.2%; and since
inception on 10/21/87: 10.6% annualized.
Of course, past trends do not guarantee future performance. 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'S THE LONG-TERM OUTLOOK FOR NATURAL RESOURCE INVESTMENTS?
BT: As we said earlier, we believe the continuing development of the emerging
market countries will fuel the growth of companies such as those in which
the Portfolio invests. Countries that are industrializing and raising their
standards of living consume a larger volume of natural resources than do
developed countries whose infrastructure is already in place.
WB: It's this kind of growth that we believe makes the Fund a valuable part of
an investor's portfolio, both as an attempt to take advantage of the growth
in emerging market economies and as a hedge against inflation.
Comparison of Change in Value of a $10,000 Investment in EV Marathon Gold &
Natural Resources Fund, the S&P 500 Stock Index and the Consumer Price Index
From October 31, 1987 through August 31, 1995
AVERAGE ANNUAL RETURNS 1 Year** 5 Years Life of Trust*
With CDSC 8.8% 8.2% 10.6%
Without CDSC 13.8% 8.5% 10.6%
Date M. Gold & Nr. S&P 500 Cost of Living
- -------------------------------------------------------------------------------
10/87+ 10,000 10,000 10,000
11/87 10,230 9,147 10,009
12/87 10,990 9,901 10,009
1/88 10,187 10,301 10,035
2/88 10,899 10,732 10,061
3/88 11,592 10,464 10,104
4/88 11,723 10,563 10,156
5/88 11,723 10,596 10,191
6/88 12,307 11,157 10,234
7/88 12,155 11,097 10,278
8/88 11,680 10,669 10,321
9/88 11,539 11,193 10,390
10/88 11,863 11,483 10,425
11/88 11,945 11,266 10,434
12/88 12,070 11,534 10,451
1/89 12,926 12,354 10,503
2/89 13,062 11,997 10,546
3/89 13,082 12,350 10,607
4/89 13,249 12,969 10,676
5/89 12,768 13,424 10,737
6/89 12,716 13,438 10,763
7/89 13,304 14,625 10,789
8/89 14,155 14,852 10,807
9/89 14,188 14,875 10,841
10/89 13,830 14,500 10,893
11/89 14,515 14,740 10,919
12/89 14,923 15,178 10,937
1/90 14,541 14,133 11,049
2/90 14,656 14,254 11,101
3/90 14,574 14,718 11,162
4/90 13,657 14,323 11,180
5/90 14,574 15,640 11,206
6/90 14,075 15,640 11,266
7/90 15,194 15,559 11,310
8/90 14,681 14,091 11,414
9/90 14,190 13,501 11,509
10/90 12,775 13,411 11,578
11/90 12,670 14,214 11,605
12/90 13,271 14,705 11,605
1/91 12,944 15,315 11,674
2/91 13,911 16,346 11,691
3/91 13,851 16,833 11,709
4/91 13,669 16,839 11,726
5/91 14,093 17,488 11,761
6/91 14,105 16,796 11,795
7/91 14,457 17,550 11,813
8/91 13,971 17,894 11,847
9/91 13,571 17,694 11,899
10/91 14,302 17,903 11,917
11/91 13,498 17,117 11,951
12/91 14,130 19,166 11,960
1/92 14,753 18,784 11,977
2/92 14,753 18,964 12,021
3/92 14,229 18,684 12,082
4/92 14,454 19,205 12,099
5/92 14,866 19,223 12,116
6/92 15,042 19,040 12,160
7/92 15,367 19,789 12,186
8/92 14,979 19,314 12,220
9/92 14,853 19,639 12,255
10/92 14,715 19,681 12,298
11/92 14,364 20,276 12,316
12/92 14,778 20,624 12,307
1/93 14,878 20,769 12,368
2/93 15,668 20,987 12,411
3/93 16,031 21,522 12,454
4/93 16,332 20,975 12,489
5/93 16,796 21,451 12,507
6/93 17,310 21,624 12,524
7/93 17,648 21,508 12,524
8/93 17,573 22,249 12,559
9/93 16,595 22,180 12,585
10/93 17,347 22,611 12,637
11/93 17,285 22,319 12,645
12/93 18,556 22,693 12,645
1/94 19,590 23,431 12,680
2/94 18,609 22,727 12,723
3/94 17,683 21,840 12,767
4/94 17,576 22,092 12,784
5/94 18,180 22,366 12,793
6/94 18,019 21,933 12,836
7/94 18,663 22,624 12,871
8/94 19,375 23,475 12,923
9/94 19,992 23,005 12,958
10/94 19,173 23,486 12,966
11/94 17,710 22,558 12,984
12/94 18,166 23,001 12,984
1/95 17,226 23,560 13,036
2/95 18,193 24,410 13,088
3/95 19,455 25,234 13,131
4/95 19,402 25,939 13,174
5/95 20,194 26,881 13,200
6/95 20,946 27,635 13,226
7/95 22,006 28,513 13,226
8/95 22,047 28,504 13,261
Past performance is not indicative 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. Source: Towers Data Systems,
Bethesda, MD.
*Investment operations commenced on 10/21/95.
+Index information is available only at month-end; therefore, the line
comparison begins at the next month-end following the commencement of the
Fund's investment operations.
**For the 12 months ended 8/31/95.
THE FUND'S PERFORMANCE
In accordance with guidelines issued by the Securities and Exchange Commission,
the performance chart above compares the Fund's total return with that of a
broad-based securities market index. The lines on the chart represent the total
returns of $10,000 hypothetical investments in the Fund, the S&P 500 Stock Index
and the Consumer Price Index.
THE TOTAL RETURN FIGURES
The colored solid line on the chart represents the Fund's performance at net
asset value. The Fund's total return figure reflects fund expenses and portfolio
transaction costs, and assumes reinvestment of income dividends and capital gain
distributions. It also reflects the Fund's maximum applicable contingent
deferred sales charge (CDSC) deducted at redemption as follows: 5% - 1st and 2nd
years; 4% - 3rd year; 3% - 4th year; 2% - 5th year; and 1% - 6th year.
The black solid line represents the performance of the S&P 500 Stock Index, a
broad-based, widely recognized unmanaged index of 500 common stocks. In contrast
to the Fund, whose investment focus is targeted toward selected natural
resources sectors, the stocks in the Index represent a diversified portfolio
spanning all sectors of the economy. The Index's total return does not reflect
any commissions or expenses that would have been incurred if an investor
individually purchased or sold the securities represented in the Index.
The dotted line represents the Consumer Price Index, an inflation measure based
on a basket of goods including food, clothing and energy. Its performance is
included to compare how the Fund has performed historically relative to
inflation.
<PAGE>
EV MARATHON GOLD & NATURAL
RESOURCES FUND
PORTFOLIO OF INVESTMENTS
AUGUST 31, 1995
- -------------------------------------------------------------------------------
COMMON STOCKS - 98.1%
- -------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- -------------------------------------------------------------------------------
GOLD & PRECIOUS METALS - 26.7%
Ashanti Goldfields Ltd. GDR 12,000 $ 249,000
Battle Mountain Gold Co. 24,000 237,000
Barrick Gold Corp. 17,000 431,375
Dayton Mining Corp. 100,000 412,500
Euro-Nevada Mining Corp.+ 9,000 348,413
Firstmiss Gold, Inc.* 40,000 900,000
Greenstone Resources Ltd. 77,000 202,125
Hecla Mining Co. 25,000 287,500
Pioneer Group, Inc. 10,000 285,000
Santa Fe Pacific Gold Corp. 33,000 400,125
TVX Gold, Inc.* 45,000 326,250
---------------
$ 4,079,288
---------------
INDUSTRIAL METALS - 23.2%
Aluminum Co. of America 5,000 $ 285,625
ASARCO Inc. 15,000 485,625
Commonwealth Aluminum Corp. 12,000 291,000
Cyprus Amax Minerals Co. 12,500 350,000
Diamond Fields Resources, Inc.+ 4,000 227,809
Freeport McMoRan Copper & Gold 16,300 381,013
Inco Limited 5,600 196,000
Phelps Dodge Corp. 4,700 297,862
Reynolds Metals Co. 5,000 298,750
RTZ Corp. PLC ADR 8,424 465,426
Western Mining Ltd.+ 39,000 262,493
---------------
$ 3,541,603
---------------
INDUSTRIAL MINERALS - 10.3%
Agrium Inc. 6,000 $ 204,750
Arcadian Corp. 12,000 223,500
First Mississippi Corp. 6,000 198,750
Minerals Technologies, Inc. 10,500 380,625
Mississippi Chemical Corp. 10,000 222,500
Potash Corp. of Saskatchewan 6,000 341,250
---------------
$ 1,571,375
---------------
IRON & STEEL - 6.1%
J&L Specialty Steel, Inc. 16,000 $ 410,000
Nucor Corp. 5,000 245,000
Republic Engineered Steel, Inc. 40,000 275,000
---------------
$ 930,000
---------------
OIL & GAS - 26.4%
Alexander Energy Corp. 40,000 $ 170,000
Anadarko Petroleum Corp. 10,700 510,925
Apache Corp. 12,000 349,500
Arakis Energy Corp.* 22,000 220,000
Beau Canada Exploration Ltd. Class A+ 170,000 197,421
Cabot Oil & Gas Corp. 13,000 188,500
Mobil Corp. 1,500 142,875
Noble Affiliates, Inc. 15,000 414,375
Plains Resources, Inc. 17,000 182,750
Royal Dutch Petroleum PLC ADR 1,800 214,650
Swift Energy Co. 25,000 225,000
Tesoro Petroleum Corp. 30,000 288,750
Transtexas Gas Corp. 10,000 177,500
Triton Energy Corp. 14,000 742,000
---------------
$ 4,024,246
---------------
PAPER & FOREST PRODUCTS - 5.4%
Mead Corporation 3,300 $ 202,538
Pacific Forest Products*+ 20,000 227,064
Rayonier Inc. 5,000 191,875
Timberwest Forest Ltd.+ 18,000 199,332
---------------
$ 820,809
---------------
TOTAL COMMON STOCKS
(Identified cost, $12,295,335) $ 14,967,321
---------------
- -------------------------------------------------------------------------------
PREFERRED STOCK - 1.5%
- -------------------------------------------------------------------------------
Freeport McMoRan Copper & Gold, Inc.
Var. Pfd. (Identified cost, $278,670) 7,000 $ 234,500
---------------
TOTAL INVESTMENTS
(Identified cost, $12,574,005) $ 15,201,821
OTHER ASSETS, LESS LIABILITIES - 0.4% 56,912
---------------
NET ASSETS - 100% $ 15,258,733
===============
*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
- -------------------------------------------------------------------------------
August 31, 1995
- -------------------------------------------------------------------------------
ASSETS:
Investments, at value (Note 1A) (identified cost,
$12,574,005) $15,201,821
Cash 114,643
Receivable for Fund shares sold 18,538
Dividends receivable 13,935
-----------
Total assets $15,348,937
LIABILITIES:
Payable for investments purchased $ 68,750
Payable for Fund shares redeemed 11,972
Payable to affiliates --
Trustees' fees 63
Custodian fee 718
Accrued expenses 8,701
--------
Total liabilities 90,204
-----------
NET ASSETS for 929,319 shares of beneficial interest
outstanding $15,258,733
===========
SOURCES OF NET ASSETS:
Paid-in capital $11,816,225
Accumulated net realized gain on investment
transactions
(computed on the basis of identified cost) 814,692
Unrealized appreciation of investments (computed on
the basis of identified cost) 2,627,816
-----------
Total $15,258,733
===========
NET ASSET VALUE, OFFERING PRICE, AND REDEMPTION PRICE
(NOTE 6) PER SHARE
($15,258,733 / 929,319 shares of beneficial interest) $16.42
======
<PAGE>
FINANCIAL STATEMENTS (Continued)
STATEMENTS OF OPERATIONS
- ------------------------------------------------------------------------------
YEAR ENDED
------------------------
AUGUST 31, SEPTEMBER 30,
1995* 1994
---------- ------------
INVESTMENT INCOME:
Income --
Dividends $ 188,694 $ 146,257
Interest 20,571 10,761
---------- ----------
Total income $ 209,265 $ 157,018
---------- ----------
Expenses --
Investment adviser fee (Note 4) $ 92,809 $ 70,439
Compensation of Trustees not members of the
Investment Adviser's organization 181 744
Custodian fee (Note 4) 8,957 16,072
Distribution fees (Note 5) 106,417 78,196
Printing and postage 28,105 21,288
Legal and accounting services 21,844 16,628
Registration costs 20,620 25,344
Transfer and dividend disbursing agent fees 12,634 11,564
Miscellaneous 8,741 6,550
---------- ----------
Total expenses $ 300,308 $ 246,825
---------- ----------
Net investment loss $ (91,043) $ (89,807)
---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments, computed
on the basis of identified cost $ 875,917 $ (61,225)
Change in unrealized appreciation of investments 634,567 1,765,546
---------- ----------
Net realized and unrealized gain on
investments $1,510,484 $1,704,321
---------- ----------
Net increase in net assets from operations $1,419,441 $1,614,514
========== ==========
*For the eleven months ended, August 31, 1995 (See Note 10)
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------
YEAR ENDED
-----------------------------------------
AUGUST 31, SEPTEMBER 30, SEPTEMBER 30,
1995* 1994 1993
------------ ----------- -----------
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment loss $ (91,043) $ (89,807) $ (39,887)
Net realized gain (loss) on
investments 875,917 (61,225) 501,513
Change in unrealized appreciation
(depreciation) of investments 634,567 1,765,546 (78,433)
----------- ----------- -----------
Net increase in net assets
from operations $ 1,419,441 $ 1,614,514 $ 383,193
----------- ----------- -----------
Distributions to shareholders --
In excess of net investment
income $ -- $ (10,924) $ --
In excess of realized gain on
investments -- (508,281) --
----------- ----------- -----------
Total $ -- $ (519,205) $ --
----------- ----------- -----------
Transactions in shares of
beneficial interest (Note 3) --
Proceeds from sales of shares $ 5,076,779 $10,163,553 $ 3,275,450
Net asset value of shares
issued to shareholder in
payment of distributions
declared -- 378,380 --
Cost of shares redeemed (4,292,802) (4,374,063) (1,641,795)
----------- ----------- -----------
Increase in net assets from
Fund share transactions $ 783,977 $ 6,167,870 $ 1,633,655
----------- ----------- -----------
Net increase in net assets $ 2,203,418 $ 7,263,179 $ 2,016,848
NET ASSETS:
At beginning of year 13,055,315 5,792,136 3,775,288
----------- ----------- -----------
At end of year (including
accumulated net investment loss of
$0, $0 and $52,552, respectively) $15,258,733 $13,055,315 $ 5,792,136
=========== =========== ===========
*For the eleven months ended, August 31, 1995 (See Note 10)
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL STATEMENTS (Continued)
FINANCIAL HIGHLIGHTS
- ---------------------------------------------------------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED SEPTEMBER 30,
AUGUST 31, ------------------------------------------------------------------------------
1995++ 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) $(0.100)** $(0.050) $(0.090) $(0.083) $ 0.020 $ 0.069
Net realized and unrealized gain
(loss) on investments 1.630** 2.650 1.480 1.103 (0.570) (0.009)
------- ------- ------- ------- ------- -------
Total income (loss)
from operations $ 1.530 $ 2.600 $ 1.390 $ 1.020 (0.550) $ 0.060
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income $ -- $ -- $ -- $ -- (0.020) (0.069)
In excess of net investment income -- (0.020) -- (0.250) (0.110) (0.091)
From net realized gain on
investments -- -- -- (0.060) (0.320) (1.220)
In excess of net realized
gain on investments -- (0.930) -- -- -- --
------- ------- ------- ------- ------- -------
Total distributions $ -- $(0.950) $ -- $(0.310) $(0.450) $(1.380)
------- ------- ------- ------- ------- -------
NET ASSET VALUE, end of year $16.420 $14.890 $ 13.240 $11.850 $11.140 $12.140
======= ======= ======== ======= ======= =======
TOTAL RETURN 10.28% 20.47% 11.73% 9.44% (4.36)% 0.01%
RATIOS/SUPPLEMENTAL DATA:*
Net assets, end of
year (000's omitted) $15,259 $13,055 $ 5,792 $ 3,775 $ 4,042 $ 4,391
Ratio of net expenses to average
daily net assets 2.43%+ 2.64% 3.15% 3.26% 3.29% 2.50%
Ratio of net investment income
(loss) to average daily net assets (0.74)%+ (0.96)% (0.92)% (0.67)% 0.17% 0.33%
PORTFOLIO TURNOVER 49% 17% 57% 32% 27% 35%
*For the four years ended September 30, 1993, the operating expenses of the Fund 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 loss per share and
the ratios would have been as follows:
NET INVESTMENT LOSS PER SHARE (0.210) (0.240) (0.110) (0.300)
====== ====== ====== ======
RATIOS (As a percentage of average daily net assets):
Expenses 3.90% 4.65% 4.42% 5.23%
Net investment loss (1.67)% (2.06)% (0.96)% (2.40)%
+Annualized.
++For the eleven months ended August 31, 1995 (See Note 10).
**Per share data is based on average shares outstanding.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(1) SIGNIFICANT ACCOUNTING POLICIES
Effective August 31, 1995 EV Marathon Gold & Natural Resources Fund (the Fund)
became a non-diversified series of Eaton Vance Growth Trust (the Trust). 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 an
open-end management investment company. The following is a summary of
significant accounting policies consistently followed by the Fund in the
preparation of its financial statements. The policies are in conformity with
generally accepted accounting principles.
A. INVESTMENT 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 Fund'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.
C. DISTRIBUTION COSTS -- For book purposes, commissions paid on the sale of Fund
shares and other distribution costs are charged to operations. As a result of a
recent Internal Revenue Service ruling, the Fund changed its tax accounting for
commissions paid from charging the expenses to paid-in capital to charging the
expenses to operations. The change had no effect on either the Fund's current
yield or total return (Notes 2 and 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.
- --------------------------------------------------------------------------------
(2) DISTRIBUTIONS TO SHAREHOLDERS
It is the present policy of the Fund to make (A) at least one distribution
annually (normally in December) of substantially all of the investment income
earned by the Fund, less its expenses and (B) at least one distribution annually
of substantially all of the capital gains realized by the Fund, if any.
Distributions are paid in the form of additional shares of the Fund or, at the
election of the shareholder, in cash. The Fund distinguishes between
distributions on a tax basis and a financial reporting basis. Generally accepted
accounting principles require that only distributions in excess of tax basis
earnings and profits be reported in the financial statements as a return of
capital. Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in
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. During the eleven months
ended August 31, 1995, $91,043 was reclassified from accumulated net investment
loss to paid-in capital, due to permanent differences between book and tax
accounting for distribution costs ($12,252) and net operating loss carryovers
($78,791). Net investment income, net realized gains and net assets were not
affected by these reclassifications.
- ------------------------------------------------------------------------------
(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 Fund shares were as follows:
YEAR ENDED YEAR ENDED YEAR ENDED
AUGUST 31, SEPTEMBER 30, SEPTEMBER 30,
1995* 1994 1993
----- --------------- --------------
Sales 345,747 731,556 250,369
Issued to shareholders
electing to receive
payment of distribution in
Fund shares -- 28,365 --
Redemptions (293,310) (320,555) (131,463)
------- ------- -------
Net increase 52,437 439,366 118,906
====== ======= =======
*For the eleven months ended August 31, 1995 (Note 10).
- ------------------------------------------------------------------------------
(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
Fund. The fee is computed at the monthly rate of 0.0625% (0.75% per annum) of
the Fund's average daily net assets up to $500 million and at reduced rates as
daily net assets exceed that level. For the eleven months ended August 31, 1995,
the effective annual rate, based on average daily net assets, was 0.75%.
Except as to Trustees of the Fund who are not members of EVM's
organization, officers and Trustees receive remuneration for their services to
the Fund out of such investment adviser fee. Investors Bank & Trust Company
(IBT), an affiliate of EVM, serves as custodian of the Fund. Pursuant to the
custodian agreement, IBT receives a fee reduced by credits which are determined
based on the average daily cash balances the Fund maintains with IBT. Certain of
the officers and Trustees of the Fund are officers and directors/trustees of the
above organizations (See Note 5).
Trustees of the Fund 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
eleven months ended August 31, 1995, no significant amounts have been deferred.
- ------------------------------------------------------------------------------
(5) DISTRIBUTION PLAN
The Fund has adopted a distribution plan (the Plan) pursuant to Rule 12b-1 under
the Investment Company Act of 1940. The Plan requires the Fund to pay the
Principal Underwriter, Eaton Vance Distributors, Inc. (EVD) amounts equal to
1/365 of 0.75% of the Fund's daily net assets, for providing ongoing
distribution services and facilities to the Fund. The Fund will automatically
discontinue payments to EVD during any period in which there are no outstanding
Uncovered Distribution Charges, which are equivalent to the sum of (i) 5% of the
aggregate amount received by the Fund 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 Fund and, accordingly, reduces
the Fund's net assets. The Fund accrued $92,800 as payable to EVD for the eleven
months ended August 31, 1995, representing 0.75% (annualized) of daily average
net assets. At August 31, 1995, the amount of Uncovered Distribution Charges of
EVD calculated under the Plan was approximately $427,000.
In addition, the Plan authorizes the Fund to make payments of service fees
to the Principal Underwriter, Authorized Firms and other persons in amounts not
exceeding 0.25% of the Fund's average daily net assets for each fiscal year. The
Trustees have initially implemented the Plan by authorizing the Fund 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 Fund's average
daily net assets based on the value of Fund 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 Fund 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 $13,617 for the eleven
months ended August 31, 1995.
Certain officers and Trustees of the Fund are officers or directors of EVD.
- ------------------------------------------------------------------------------
(6) CONTINGENT DEFERRED SALES CHARGE
A contingent deferred sales charge (CDSC) is imposed on any redemption of Fund
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 reinvestment 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 Fund's Distribution Plan. If no Uncovered Distribution
Charges exist, the CDSC will be credited to operations. EVD received
approximately $100,000 of CDSC paid by shareholders for the eleven months ended
August 31, 1995.
- ------------------------------------------------------------------------------
(7) LINE OF CREDIT
The Fund participates with other funds managed by EVM in a $120 million
unsecured line of credit agreement 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 Fund 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 Fund 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 U.S. Government Securities and
short-term obligations, aggregated $7,790,318 and $6,497,250, respectively.
- ------------------------------------------------------------------------------
(9) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investment
securities owned at August 31, 1995, as computed on a federal income tax basis,
are as follows:
Aggregate cost $12,574,005
===========
Gross unrealized appreciation $ 3,152,554
Gross unrealized depreciation 524,738
----------
Net unrealized appreciation $ 2,627,816
===========
- ------------------------------------------------------------------------------
(10) SPECIAL SHAREHOLDER MEETING
The Fund changed its fiscal year end from September 30 to August 31, effective
August 31, 1995. EV Marathon Gold & Natural Resources Fund (the Fund) held a
special shareholder meeting on August 30, 1995. On July 5th, 1995, the record
date of the meeting, the Fund had 932,342.795 shares outstanding, of which
540,439 shares were represented at the meeting. The votes at the meeting were as
follows:
Item: The approval of an Agreement and Plan of Reorganization pursuant to which
the Fund will be recognized to become a series fund of Eaton Vance Growth Trust,
a Massachusetts business trust.
NUMBER OF SHARES
(UNAUDITED)
---------
Affirmative 506,089
Against 4,640
Abstain 29,710
<PAGE>
INDEPENDENT AUDITORS' REPORT
- ------------------------------------------------------------------------------
TO THE TRUSTEES AND SHAREHOLDERS OF
EV MARATHON GOLD & NATURAL RESOURCES FUND:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of EV Marathon Gold & Natural Resources Fund (the
Fund) (one of the series of Eaton Vance Growth Trust) as of August 31, 1995, the
related statements of operations for the eleven months then ended and the year
ended September 30, 1994, the statements of changes in net assets for the eleven
months ended August 31, 1995 and for the years ended September 30, 1994 and
1993, and the financial highlights for the eleven months ended August 31, 1995
and for each of the years in the five-year period ended September 30, 1994.
These financial statements and financial highlights are the responsibility of
the Fund'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 securities owned at August
31, 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 EV Marathon Gold &
Natural Resources Fund at August 31, 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
SEPTEMBER 29, 1995
<PAGE>
INVESTMENT MANAGEMENT
EV MARATHON OFFICERS INDEPENDENT TRUSTEES
GOLD & NATURAL JAMES B. HAWKES DONALD R. DWIGHT
RESOURCES FUND President, Trustee President,
24 Federal Street LANDON T. CLAY Dwight Partners, Inc.
Boston, MA 02110 Vice President, Trustee Chairman, Newspapers of
M. DOZIER GARDNER New England, Inc.
Vice President SAMUEL L. HAYES, III
WILLIAM D. BURT Jacob H. Schiff Professor of
Vice President and Investment Banking,
Portfolio Co-Manager Harvard University
BARCLAY TITTMANN Graduate School of
Vice President and Business Administration
Portfolio Co-Manager NORTON H. REAMER
JAMES L. O'CONNOR President, United Asset
Treasurer Management Corporation
THOMAS OTIS JOHN L. THORNDIKE
Secretary Director, Fiduciary Company
Incorporated
JACK L. TREYNOR
Investment Adviser and Consultant
<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
ANNUAL
SHAREHOLDER REPORT
AUGUST 31, 1995
