ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
ANNUAL REPORT
DECEMBER 31, 1995
The following Annual Report for the Alliance Variable Products Series Fund,
Inc. (the "Fund") includes financial information for the fifteen Portfolios of
the Fund which were active as of December 31, 1995. Not all Portfolios of the
Fund are available through each insurance product offering investments in the
Fund.
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ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
LETTER TO SHAREHOLDERS
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January 31, 1996
Dear Investor:
It was a banner year for the U.S. financial markets in 1995. The bond market
was stimulated by a near 2% drop in long-term rates while the S&P 500 Index
advanced by more than 37%.
The rally in the bond market was prompted by last year's tightening by the
Federal Reserve, which slowed economic growth to near-trend levels while
keeping inflation low. An important shift in the pace of inflation occurred
during 1995. At the start of the year, inflation was in the 4%-4.5% range and
market watchers anticipated that it would fall to 3.5% by year end. Instead, we
have moved into 1996 with inflation at a relatively stable 2.5% level.
This shift caused the 30-year bond yield to drop from approximately 8% to 6%
during 1995--a significant drop for a 12-month period. The combination of a
benign inflation outlook and lower interest rates created a particularly
positive environment for bond investors.
In 1995, the bond market was also encouraged by the increasing prospects of
reducing or even eliminating the Federal budget deficit. Although the budget
debate continues, an agreement is expected and would be extremely important as
a way to guarantee substantial progress in cutting the budget, even if more
ambitious Republican plans are not met.
The Federal government is the largest borrower of credit in the economy. A
shrinking deficit, therefore, would substantially reduce demands for funds and
spur lower interest rates. If the government's borrowing requirement declines
over time, we may see the spread between inflation and long-term interest rates
contract from the 4%-6% range, where it has remained since 1980, back to the
2.5%-3% seen before 1980. If we reach this 2.5%- 3% spread, we can also
anticipate long-term interest rates below 6%, which we saw briefly at the
beginning of December. When long-term rates are below 6%, both the markets and
consumers benefit.
Falling interest rates, low inflation and good corporate earnings created a
near-ideal environment for stocks in 1995. The strongest areas of the stock
market were technology, which benefited from very rapid industry growth;
financial services, which benefited from the drop in rates; and health care,
which benefited from its non-cyclical earnings and was not negatively affected
by the economic slowdown. The industry also continued its recovery from the
health care bear market, which came to an end when reform legislation failed.
The surprise in the stock market this year was that, in a market environment of
tepid sales growth and where there was little power to raise prices,
corporations continued to expand margins and record good profits. The happy
result for investors was rising prices plus increasing earnings ratios--and
returns often in excess of 30%.
FOREIGN MARKETS UNDERPERFORM
Foreign stock markets, which outperformed the U.S. market throughout 1994,
could not keep pace with the U.S. rally in 1995. The European markets came
closest--the MSCI European Index was up more than 20% for 1995, with 8% in
currency gains against the U.S. dollar. The Japanese equity market was up only
0.7% in 1995, pulled down by a weak yen, while developing markets, represented
by Morgan Stanley's Emerging Markets Index, were down 7% for the year.
Looking forward, we expect that U.S. economic growth will remain modest.
Wrangling over the budget has caused interest rates to increase and, in the
near term, the bond market should remain in a wider trading range until there
is a resolution. Market participants are frustrated given the lack of economic
data, but there seems to be
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little risk of excessive economic growth. With few inflationary pressures on
the horizon, we expect the Federal Reserve to cut interest rates further in
order to stimulate consumer expenditures and investment. If our forecast proves
correct, the result should be further gains in U.S. bond prices.
OUTLOOK FOR 1996
It will be difficult for U.S. companies to maintain the strong profit growth
seen in 1995 with nominal GDP growth (real growth plus inflation) below 5%. We
suspect that the stock market will hit weakness at some point during the year
as more realistic profit forecasts are built into stock prices.
We believe that 1996 will see foreign markets begin to catch up with the U.S.
However, we do not see significant downside risk for the U.S. stock market. The
economic expansion hasn't produced excesses that require a recession to
correct. This year should bring moderate growth in both the economy and the
stock market, albeit at rates much more modest than in 1995.
In the following pages are commentaries about investment activity for each of
the Portfolios and a separate page with investment results through December 31,
1995. We appreciate your investments in the Portfolios of Alliance Variable
Products Series Fund and look forward to reporting to you again in the coming
period.
Sincerely,
John D. Carifa
Chairman and President
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PREMIER GROWTH PORTFOLIO
The Premier Growth Portfolio benefited a great deal from the strong sustained
rally in the U.S. stock market over much of 1995. The Portfolio achieved a
remarkable +44.85% return through December 31, 1995--significantly
outperforming the +37.5% return for the unmanaged S&P 500 Index. In managing
the Portfolio, our strategy is to stay fully invested, but to vary the degree
of aggressiveness from time to time. Though today we are not as bullish as we
were a year ago, we still believe the market will post respectable gains in
1996. For those who are bearish (i.e., believing the market is due for broad
declines), we believe they may be unable to buy stocks materially below today's
levels. However, despite our forecast for market upside, stock selection will
be critical and it will be incumbent on portfolio managers to continually
assess each company's fundamentals carefully and to pay particular attention to
price. Because we believe that successful investing comes from the correct
marriage of company fundamentals and price, stock selection for your Portfolio
is based on a research process in which we try to assess where a particular
company, and the market, are at any time both relatively and absolutely as
prices fluctuate.
Looking back at 1995, three sectors performed particularly well for the
Portfolio: technology, financial services and transportation. The 25-30% in
technology stocks and around 20% in financial services stocks benefited from a
lower interest rate environment, and many transportation stocks turned in
double-digit returns for the year.
Although historically the same sectors are not top performers in consecutive
years, as we look forward to 1996 we are currently maintaining positions in
these areas because they still seem to have the best earnings momentum, and
their prices, while not at bargain basement levels, are still reasonable in our
opinion.
GLOBAL BOND PORTFOLIO
The Global Bond Portfolio provided a strong total return of over +24% for the
fiscal year ended December 31, 1995. This was due largely to the Portfolio's
significant holdings in U.S. fixed-income securities, which performed very well
in 1995 following the tightening in monetary policy by the Federal Reserve. At
the end of the year, investments in U.S. Government securities represented about
42% of the total net assets. Securities of Spain, Belgium and Japan--ranging
from 8.4-9.5% of assets--were also significantly represented.
For 1996 the outlook for global bond investing appears to be favorable. The
major central banks have been easing monetary policy, and by year end it should
become clear whether the current easing has been enough to stimulate growth. We
believe that growth will remain below its inflationary potential in most
economies, and therefore scope for further easing remains. Growth below
potential means that inflationary pressures will continue to be subdued--a
combination that should result in further capital appreciation potential in
fixed income markets.
Recent economic data suggests that the U.S. will grow at a pace of approximately
2-2.5% in 1996, but there is possibility that it will be slower. Even at 2.5% it
is unlikely that the U.S. economy will generate significant inflationary
pressure and the consumer price index--a common measure of inflation--could
trend below 2.5%. This would support higher prices in U.S. fixed income markets.
In Europe, Germany and France appear to be slowing quite rapidly. Their
economies are being hurt by overvalued exchange rates both relative to the U.S.
dollar and relative to other European currencies. This slowing of growth is
being met by monetary relaxation and does not appear to be offsetting the tight
fiscal policy in Europe that most countries are following in order to meet the
Maastricht criteria for government debt. (According to the Maastricht Treaty,
enacted in 1992, European Union nations joining the planned monetary union must
meet specific economic criteria, which includes the stipulation that annual
inflation mustn't exceed that of the three best-performing nations by more than
1.5 percentage points.) In this environment, the outlook for further declines in
inflation remains very good and consequently supportive of European bond prices.
In
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markets such as Italy and Spain structural reforms appear to be having the
desired effect of reducing inflation and the government deficits. As such, the
historic risk premium that investors have demanded for investing in Italian and
Spanish debt is likely to be reduced and therefore these markets appear among
the most attractive.
In our view, the Japanese economy appears to have the most favorable outlook.
Monetary and fiscal stimuli are more advanced than elsewhere and the effect is
showing with an improvement in a broad number of measures of activity. There is
concern over whether it will be able to sustain this improvement if other
economies to which Japan is a net exporter continue to slow. Given the low
level of yields Japan appears the least attractive in terms of fixed income
investing.
GROWTH AND INCOME PORTFOLIO
The stock market reached new highs in 1995, with the S&P 500 up more than 37%
for the year. The market benefited from the almost-2% drop in long-term
interest rates, which caused price earnings ratios to rise. Substantial
improvements in efficiency throughout the year helped companies to increase
profits even as sales growth declined.
The Growth & Income Portfolio posted a gain of more than 35% for 1995. This is
a strong return in both relative and absolute terms, though it slightly lagged
the 37.5% return of the S&P 500. The Portfolio's focus on blue chip, high
dividend paying equity holdings prevented us from participating in the rally of
smaller, more volatile stocks, which added to S&P 500 performance. In strong
markets such as the one we experienced in 1995, higher-yielding stocks cannot
keep pace with the averages.
Steps were taken during the fiscal year that helped improve the Portfolio's
risk-adjusted performance. First, sector weightings were brought more in line
with the sector weightings of the S&P 500. Importantly, however, it is the
selection of individual stocks within sectors, rather than sector selection,
that has led to the Portfolio's good performance. Also, positions in stocks
that are no longer included in Alliance's broad research universe were also
eliminated. Taken in sum, we believe these actions contributed positively to
performance.
While the short-term direction of the market is difficult to predict, over the
long term stocks have historically outperformed other types of investments. For
this reason we remain fully invested in equities and equity-related securities
and believe that stock picking on a selective basis will be the key to superior
performance notwithstanding the economy's whims.
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SHORT-TERM MULTI-MARKET PORTFOLIO The Short-Term Multi-Market Portfolio
benefited from 1995's bond market price gains, though twelve-month performance
versus the U.S. bond market was restrained by the difficult conditions in
foreign markets, particularly Mexico, that carried over into early 1995. Most
of the Portfolio's gain was achieved over the latter six months as emerging
market and other foreign debt prices recovered.
Two main factors influenced the Portfolio's performance during the latter part
of the year. First was the strong price appreciation in global fixed income
markets. The Portfolio's short maturity policy limited the benefit of these
gains to a degree, but the rally was strong even at the shorter ends of global
yield curves. The second factor involved the decline in the value of the
Japanese yen of approximately 20% from its peak in June. Since we have been
using the yen as a hedge currency, this worked quite nicely in the Portfolio's
favor.
With respect to our currency outlook, it is really more of an outlook on the
U.S. dollar. We are expecting the dollar to appreciate versus both the Japanese
yen and the German deutschemark. The long-standing U.S. trade deficit appears
to have peaked, which should benefit the dollar, but, more importantly, the
outlook for our budget deficit compared to the Japanese and German budget
deficits is very favorable. The poor fiscal situations in Europe and Japan will
impede economic growth in these regions which should contribute to weaker
currencies. Also, in the U.S., structural reform in both the labor market and
in the corporate sector have far outweighed any reforms undertaken in Europe or
Japan. In Europe the social welfare system remains far too large in the current
competitive global environment, and Japanese markets for goods and services
remain closed to global competition, thus hindering its economy. For these
reasons we look for the dollar to appreciate.
During the fourth quarter we initiated exposure to Thailand's currency, the
baht. The East Asian region has had the strongest overall economic growth of
any region in the world in the last 10 years or so, and in our view this strong
growth pattern should continue over the next decade and we believe exposure to
the baht will benefit the Portfolio's performance.
There are a couple of major events that have already helped spur growth in
countries such as Thailand. First, The People's Republic of China is beginning
to open up its market to outsiders and Thailand will benefit because of its
broadly educated population, relatively cheap labor force and established
manufacturing base.
Also, many Japanese companies have started to outsource their manufacturing
into Thailand as the cost structures there are a fraction of those in Japan.
Consequently, foreign direct investment in Thailand by the Japanese can be
expected to remain at high levels.
With regard to the Portfolio's exposure to the Mexican peso, which is lower
than it was at mid-year, in our view the Mexican peso remains very cheap and
real interest rates remain attractive. However, the political situation, the
banking sector, and the monetary policies of the Mexican officials all remain
quite nebulous. We must have a clearer picture of how some of the outstanding
issues will be worked out before we commit more of the Portfolio's assets to
Mexico.
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U.S. GOVERNMENT/HIGH GRADE SECURITIES
PORTFOLIO
U.S. bonds provided extraordinary returns in 1995. Interest rates declined by
250 basis points for two-year Treasury securities and by 200 basis points for
thirty-year Treasury securities. Short rates did not decline as much, with the
three-month T-bill improving by 54 basis points. The ground work for the rally
was laid by last year's tightening by the Federal Reserve, which slowed
economic growth to near trend levels while keeping inflation low.
While the U.S. economy slowed in the first half of 1995, growth improved in the
third quarter due to larger-than-expected increases in residential housing,
government spending and business inventories. However, fourth quarter economic
growth was less robust. Retail sales remained weak and gains in real disposable
income slowed while personal debt levels continued to escalate. Growth also
remained sluggish in the manufacturing sector.
A rally at year-end was sparked by the benign inflation outlook and the
possibility of a federal government deficit package. Broad price indices such
as the Consumer and Producer Price Indices rose only modestly and labor costs
remained under control.
The Portfolio's performance improved against its benchmark as 1995 progressed.
The first quarter was the most difficult period, as we started the year with a
bearish outlook for the bond market. However, we subsequently repositioned the
Portfolio to benefit from a positive market environment. The Portfolio was
invested in a combination of mortgage-backed and Treasury securities. We varied
our weighting in fixed-rate mortgages in response to the outlook for
pre-payments and the level of market volatility.
TOTAL RETURN PORTFOLIO
The economic environment of slow growth, subdued inflation and declining
interest rates provided the backdrop for an excellent year in the financial
markets. The stock market was propelled by surprisingly strong corporate
profits and a sharp drop in interest rates. In addition, strong cash flow into
U.S. equity mutual funds continued. In 1995, the S&P 500 gained more than 37%,
led by the performance of large capitalization stocks, while bonds racked up
double-digit returns.
During the first two months of 1995, conservative corporate positioning and an
unforeseen shift in Federal Reserve monetary policy detracted from the
performance of the Portfolio's bond component, although it went on to
outperform the market during the rest of 1995. We are maintaining a longer-
than-average duration versus the Lehman Government/Corporate Index in response
to the continued slow growth of the economy.
The equity component of the Total Return Portfolio emphasizes growth at a
reasonable price across the capitalization spectrum. The Portfolio holds high
quality, leading companies and is broadly diversified across industry lines. We
continue to focus on the stocks of those companies, in any industry, whose
earnings growth is reliable, steady and much faster than that of the stock
market in general.
The Portfolio's asset mix as of year-end was 59% in stocks, 27% in U.S.
Government securities and about 14% in cash. We believe the Portfolio's stock
holdings have the potential for significant earnings improvements in 1996.
However, there are risks in the stock market if the U.S. economy strays from
its non-inflationary growth path. Given our forecast for the economy and
financial markets, we are not anticipating making any significant shifts in the
asset mix in the near future.
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INTERNATIONAL PORTFOLIO
Although most European economies continue to be weak, economic signals such as
falling interest rates and subdued inflation in Europe and Asia suggest that
the international stock markets may be poised to perform better in 1996.
Japan, of course, is still struggling to jump-start its economy. Because the
Japanese market, the second largest in the world, comprises such a large part
of the EAFE Index, its direction remains the critical question. We are hopeful
that low inflation rates and government intervention will be successful in
stimulating the Japanese economy. If such efforts succeed, EAFE could fare
better than domestic funds in 1996.
The U.S. market posted the best performance of all major global markets in
1995, outperforming Europe, Japan and developing markets, with the S&P 500
Index rising 37.5%. During the year, the European Index gained 21.5%, of which
8% represented currency gains. Japan was up 0.7% despite yen weakness, which
reduced performance by 4%. Developing markets lagged with a decline of 7% for
the year.
Currency-market volatility was a major factor in global performance in 1995
as the U.S. dollar experienced a roller coaster ride, particularly against the
yen. From January to April, the dollar weakened dramatically, which reduced
earnings for most non-dollar based companies. The goods and services of non-
dollar based companies began to look expensive in the competitive global
marketplaces. A significant reversal of the dollar's weakness occurred by year-
end, after settlement of the U.S./Japan trade dispute and intervention by major
central banks (particularly the U.S. and Japan).
The International Portfolio benefited to a degree by its ownership of growth
stocks, which performed relatively well in international markets due to the
continuous interest rate reductions that began at the end of the first quarter.
These reductions were attempts by the central banks of the developed countries
to turn around the decelerating growth in their economies. The Portfolio ended
the year with a return of 9.86%, which compares with a return of 11.21% for its
unmanaged benchmark, the MSCI EAFE Index, with net dividends reinvested.
For 1996, we expect continued declines in interest rates globally and we
believe foreign markets will soon begin to catch up with the U.S. Our forecast
includes better sales and earnings comparisons for European and Japanese
manufacturers against dollar-based competitors. Year-end historic valuation
measures indicate that the U.S. stock market is expensive relative to
international stock markets, while growth stocks are expensive and cyclical
stocks appear attractive. We retain significant hedges on European currencies
since we expect the dollar to further strengthen in 1996.
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MONEY MARKET PORTFOLIO
Fluctuating market conditions, and shifts in Federal Reserve Board policy, kept
money market fund managers on their toes in 1995. As the year opened, the Fed
raised the key Fed Funds rate to 6.00%. It was the seventh tightening in a
twelve-month period, and we maintained a short average maturity to take
advantage of any further rate hikes.
As the first quarter of 1995 came to an end, it appeared that inflation was
being held in check. Second-quarter data indicated a slowdown in growth, which
in turn caused us to shift strategy toward a more neutral stance and an average
duration. It became clear that the short-term yield curve was beginning to
flatten out.
When the Fed announced a 25-basis-point easing in early July, it marked the
first time since 1989 that we saw a tightening and an easing in the same year.
Within the money market, as short-term interest rates began to rise above
long-term rates--a rare situation known as an inverted yield curve, the
Portfolio extended its average maturity to maintain competitive performance
yield.
Weak economic data continued to flow in during the third and fourth quarter,
and the lack of a federal budget agreement may have delayed additional interest
rate easings. Finally, in December, the Fed authorized another reduction in
the Federal Funds rate, which closed the year at the 5.50% level. We responded
by further extending the Portfolio's average maturity.
According to the Fed, the December easing was based on a decline in inflation
expectations. This, combined with one of the most disappointing holiday retail
seasons since World War II, indicates that the economy will probably remain
sluggish as we enter 1996. In anticipation of further declines in yields, we
plan to maintain a relatively high average fund duration.
GLOBAL DOLLAR GOVERNMENT PORTFOLIO The excellent performance of fixed-income
markets continued throughout 1995. The very strong +22.98% total return for the
Global Dollar Government Portfolio in 1995 resulted from overall improvements
in emerging market debt, specifically sovereign debt, as well as the rally
in U.S. fixed income markets. (As of December 31, your Portfolio held U.S.
Government securities totaling 17.7% of assets.) Much of the price gains were
experienced in the latter half of the year. As the year began, the economy was
operating at full capacity and growing rapidly. By the second quarter, it was
apparent that the increase in interest rates in 1994 and early 1995, and
declining inflationary pressures, had succeeded in slowing growth to a more
sustainable path it has since followed.
Outside the U.S., emerging market debt prices continued the upward trend that
began in March. The rebound is due, in part, to the favorable U.S. interest
rate environment and improvement in the Mexican and Argentine economic
outlooks. The Argentine economy appears to have recovered from its brief
recession. The Argentine government's adherence to sound fiscal and monetary
policies has helped stabilize the currency, restrain inflation and boost
investor confidence.
Brazil and Poland may offer the best investment opportunities in emerging
markets over the next few months. It is our expectation that Brazilian debt
will outperform obligations of other Latin American countries as a result of
improving economic conditions and a possible debt buy-back program that would
help boost bond prices over the near term. Similarly, Polish debt obligations
should outperform other non-Latin debt as the country continues its impressive
economic growth. Poland's Brady bonds were recently upgraded to BBB; it is the
first country whose sovereign debt has reached an investment-grade rating.
Looking forward, we believe that the outlook remains positive for fixed-income
securities, although lower interest rates suggest that total returns in 1996
may be lower than in 1995.
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NORTH AMERICAN GOVERNMENT INCOME
PORTFOLIO
The U.S. bond market continued its broad-based rally over the past six months.
In Canada, aggregate bond prices rose despite uncertainty regarding the Quebec
separatist movement. In both Mexico and Argentina, debt prices continued the
rebound that began in March. Much of the Portfolio's +22.71% total return for
1995 was gained over this period.
The rally in the U.S. extended across nearly all sectors of the bond market,
with longer-duration securities outperforming shorter-duration securities as
interest rates for all maturities declined.
Outside the U.S., emerging market debt prices continued the upward trend that
began in March. The rebound is due, in part, to the favorable U.S. interest
rate
environment and improvement in the Mexican and Argentine economic outlooks. One
year after the economic crisis began in Mexico, the country's economy is
showing
initial signs of growth though its banking sector remains strained.
The Argentine economy also appears to have recovered from its brief recession.
The Argentine government's adherence to sound fiscal and monetary policies has
helped stabilize the currency, restrain inflation and boost investor
confidence.
U.S. economic growth is expected to remain modest in the period ahead. With few
inflationary pressures on the horizon, we expect the Federal Reserve to cut
interest rates further to stimulate consumer expenditures and investment.
Lower volatility is expected in the Canadian bond market as the Quebec
separatist movement failed to win its referendum. Economic growth in Canada is
expected to remain moderate with continued weakness in both consumer spending
and industrial production. Inflation remains well contained, which should allow
the Bank of Canada to cut interest rates if growth slows further.
In emerging markets, we expect Argentina to outperform over the next several
months. The Argentine government is implementing a plan to increase federal
revenues, improve the fiscal position of the provincial governments and obtain
new financing from domestic and international markets. These prudent economic
policies combined with Argentina's stable political environment should support
higher bond prices despite the country's recent economic difficulties.
As we mentioned there has been a recent improvement in the Mexican economy, but
the longer-term outlook remains uncertain. The Mexican peso has reached what we
believe is a sustainable exchange rate level versus the U.S. dollar and we
expect further currency stability in the months ahead.
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UTILITY INCOME PORTFOLIO
During 1995 telecommunication services and electric utility stocks performed
very well on an absolute basis relative to their performance in the past
several years. The NASDAQ Telecom Index ended 1995 up 35.1% for the year and
the Philadelphia Electric Utility Index gained 28.6%. The utility stocks of
emerging markets had another disappointing year; overall stock market
performance declined 9.2% (as measured by Morgan Stanley's Emerging Markets
Index) while the overall stock market in the U.S. (as measured by the S&P 500),
posted an impressive gain of 37.5% for 1995.
We attribute the solid absolute performance of most utilities to a number of
factors, including a declining interest rate environment, positive regulatory
decisions, increased anticipation of telecommunications legislation, a pick up
in merger and acquisition activity and overall financial improvement (i.e.,
significant free cash flow generation, stronger balance sheets, solid earnings
and lower dividend payout ratios).
Throughout the past year the Portfolio's electric utility positions have been
largely focused on high quality companies with strong cash flow and improving
competitive positions. Overall, the domestic holdings in this area delivered
strong performance in 1995.
During the summer we significantly increased the Portfolio's exposure to
telecommunication services and equipment. Our basis for overweighting these two
areas was improved valuations in the telecom services sector resulting from
poor performance of the group over the previous 18 months. In addition, we had
greater conviction in the long-term global growth and profitability potential
for the telecom equipment sector.
During the second half of the year, telecom services significantly outperformed
the S&P 500, but the telecom equipment sector experienced a sharp sell-off in
the fourth quarter of 1995. Fortunately, the Portfolio's exposure to the poorly
performing emerging markets was underweighted throughout much of the year.
Our forecast for good performers in 1996, in order of preference, includes
telecom equipment stocks, telecom services and domestic electric utilities. We
are also optimistic about opportunities among several areas within the emerging
markets. As a result, our investment strategy for 1996 is to maintain about 25%
of the Portfolio's assets in telecom equipment stocks; to increase exposure to
emerging market utilities; to modestly increase the weighting in telecom
services, and to selectively reduce the weighting in domestic electric
utilities as these stocks become fully valued.
We believe 1996 has the potential to be another strong absolute performance
year driven by telecom equipment and telecom services stocks, and improving
performance from emerging markets. Our positive outlook is based on the
following expectations: a declining global interest rate environment; low to
moderate global inflation; improving global economies; and finally, an extended
global business cycle - all of which will help to fuel higher expectations for
cash flow growth and more predictable future earnings.
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GROWTH PORTFOLIO
Last year was one of the best years ever for the U.S. stock market. It was the
Federal Reserve's tightening of monetary policy in 1994 that kept inflation in
check and allowed for an easing of interest rates in 1995. Combined with good
corporate earnings, this created a near-ideal environment for domestic stocks.
As the year progressed, it became more apparent that the pace of economic
growth was slowing. This resulted in a narrowing of market leadership, with
blue chip consumer stocks, considered to be relatively insulated from the
economic cycle, advancing well ahead of the general market. As these stocks are
heavily represented in the stock market averages, funds which typically invest
in a broader mix of companies had a difficult time matching the performance of
the Dow Jones Industrials and Standard and Poor's averages.
The Growth Portfolio did well through the summer months, but lagged later in
the year as its large technology holdings came under selling pressure. We have
shifted emphasis within this sector away from personal-computer related stocks
and toward computer networking companies, which are profiting from the
extraordinary growth of the Internet. We think that the selling in these stocks
will run its course and that they will do well in 1996. The Portfolio also
continues to stress financial stocks.
Clearly, 1995 performance was well above trends and is unlikely to be matched
in 1996. With interest rates low and inflation under control, we do not see
significant downside risk. The economic expansion hasn't produced excesses that
require a recession to correct. This year should bring moderate growth in both
the economy and the stock market, albeit at rates much more modest than in
1995.
WORLDWIDE PRIVATIZATION PORTFOLIO
The Worldwide Privatization Portfolio achieved a favorable +10.87% total return
for 1995, though it slightly trailed the +11.21% return for the EAFE Index.
Returns were helped by a strong rally in international markets in the early
part of January, which was precipitated by further declines in short-term
interest rates in Europe. This trend is likely to continue over the early part
of 1996 and we anticipate further positive market reaction to this reduction in
the cost of money.
As the interest rate differential between Europe and the United States
continues to narrow we anticipate further strength in the U.S. dollar against
the world's major currencies. In this regard we have maintained an active
hedging policy for the Portfolio. With a significant percentage of assets
hedged into U.S. dollars and a further 30% invested in U.S. dollar-related
currencies we consider the Portfolio to be adequately protected from a
significant rise in the U.S. unit.
Despite the relatively unfriendly nature of many stock markets, particularly in
the emerging markets arena, privatization volume in 1995 reached $70 billion,
well ahead of most estimates. Consequently, we anticipate 1996 will be another
record year - particularly as the recent rally in emerging markets has renewed
investors' appetite for new issues from the region.
Overall the Worldwide Privatization Portfolio remains broadly fully invested
and well diversified by country, industry and issue with approximately 68% of
assets in the developed markets and 32% in emerging markets. We remain
confident about the outlook for world equity markets and the potential of
privatization issues over the course of 1996.
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CONSERVATIVE INVESTORS PORTFOLIO
Both the equity and fixed-income markets saw significant rallies in 1995. The
S&P 500 Index rose more than 37% in 1995, while long-term interest rates
dropped by nearly 2%. With this sharp drop in interest rates, the Conservative
Investors Portfolio recovered last year's decline and went on to post a strong
double-digit return. The Portfolio lagged its unmanaged benchmark, a composite
of the Lehman Brothers Treasury Bond Index (70%) and the S&P 500 (30%), mostly
due to a conservative asset mix.
The performance of the Portfolio's equity holdings was fairly close to that of
the S&P 500 due to our emphasis on consumer non-cyclical and financial stocks.
These sectors were not hurt by slower-than-expected economic growth.
Performance in the fixed-income portion of the Portfolio was above benchmark,
largely due to a longer- than-average maturity and the drop in long-term
interest rates.
Our asset mix remains conservative, with 11.5% of the Portfolio invested in
stocks and 86% in fixed-income investments including short-term securities. The
stock market is at record highs on many valuation measures and consequently we
intend to keep the Portfolio's exposure to stocks at relatively low levels.
On the fixed-income side, the Portfolio's average maturity is slightly longer
than the benchmark. We suspect that the economy will be off to a weak start in
1996 and that bond prices will be firm. Portfolio quality remains very high, so
that any credit quality concerns created by the economic slowdown should not
affect performance.
GROWTH INVESTORS PORTFOLIO
Last year the S&P 500 index rose more than 37%, while long-term interest rates
dropped by nearly 2%. Though the Growth Investors Portfolio posted a strong
double- digit return of 20.48% in 1995, it ended the year behind its unmanaged
benchmark, a composite of the S&P 500 (70%) and the Lehman Brothers Government/
Corporate Bond Index (30%), which returned 32.05%. Last year was a difficult
year for fund managers to keep up with benchmarks such as the S&P 500, since
blue-chip companies that make up these indices significantly outperformed the
average stock.
However, we believe that the Portfolio's return is competitive with other
balanced and asset allocation funds. The performance of the Portfolio's equity
holdings was fairly close to that of the S&P 500 due to our emphasis on
consumer non-cyclical and financial stocks. These sectors were not hurt by
slower-than-expected economic growth. On the fixed-income side, we maintained a
longer than average maturity throughout the year, which helped to boost
performance. The Portfolio also benefited from the drop in long-term interest
rates and the good performance of the high-yield sector.
The current asset mix is about 41% in stocks and the balance is in U.S.
Government fixed-income securities and cash. Within the fixed-income portion of
the Portfolio, we are maintaining an average maturity slightly longer than the
benchmark. We suspect that the economy will be off to a weak start in 1996 and
that bond prices will remain firm.
It will be difficult for U.S. companies to maintain profit growth in 1996 and
we suspect that the stock market will hit weakness at some point during the
year as more realistic profit forecasts are built into stock prices. If profits
begin to weaken, the Portfolio's asset mix will be adjusted by selling
companies with disappointing profits.
12
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INVESTMENT RESULTS
- ------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS AS OF DECEMBER 31, 1995
Listed below are the Portfolios' average annual total returns for the one-year,
five-year (where applicable) and since- inception periods ended December 31,
1995.
EQUITY PORTFOLIOS
CONSERVATIVE INVESTORS PORTFOLIO
o One Year +16.99%
o Since Inception (10/94) +14.90%
GROWTH AND INCOME PORTFOLIO
o One Year +35.76%
o Since Inception (1/91) +11.13%
GROWTH INVESTORS PORTFOLIO
o One Year +20.48%
o Since Inception (10/94) +15.71%
GROWTH PORTFOLIO
o One Year +35.23%
o Since Inception (9/94) +31.24%
INTERNATIONAL PORTFOLIO
o One Year +9.86%
o Since Inception (12/92) +12.50%
PREMIER GROWTH PORTFOLIO
o One Year +44.85%
o Since Inception (6/92) +18.20%
TOTAL RETURN PORTFOLIO
o One Year +23.67%
o Since Inception (12/92) +9.26%
UTILITY INCOME PORTFOLIO
o One Year +21.45%
o Since Inception (5/94) +12.23%
WORLDWIDE PRIVATIZATION PORTFOLIO
o One Year +10.87%
o Since Inception (9/94) +9.32%
FIXED INCOME PORTFOLIOS
GLOBAL BOND PORTFOLIO
o One Year +24.73%
o Since Inception (7/91) +9.99%
GLOBAL DOLLAR GOVERNMENT PORTFOLIO
o One Year +22.98%
o Since Inception (5/94) +12.10%
MONEY MARKET PORTFOLIO
o SEC 30-Day Yield 4.71%
o SEC Seven-Day Yield 4.62%
NORTH AMERICAN GOVERNMENT
INCOME PORTFOLIO
o One Year +22.71%
o Since Inception (5/94) +4.63%
SHORT-TERM MULTI-MARKET PORTFOLIO
o One Year +6.76%
o Five Years +2.79%
o Since Inception (11/90) +2.82%
U.S. GOVERNMENT/HIGH-GRADE
SECURITIES PORTFOLIO
o One Year +19.26%
o Since Inception (9/92) +6.65%
The average annual total returns are based on net asset value performance and
reflect investment of dividends and/or capital gains distributions in
additional shares. These figures do not reflect insurance company separate
account or annuity contract charges, which would reduce total return to a
contract owner. Past performance does not guarantee future results. Investment
return and principal value will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than their original cost. Yields are for
the periods ended December 31, 1995.
13
<PAGE>
Var Premier S&P500 Russell 1000
------------- ---------- -------------
6/30/92 $10,000 $10,000 $10,000
12/31/92 $11,380 $10,834 $10,992
12/31/93 $12,817 $11,923 $12,108
12/31/94 $12,438 $12,080 $12,154
12/31/95 $18,016 $16,614 $16,744
Var Glb Bond SB WGB Index
------------ -------------
7/31/91 $10,000 $10,000
12/31/91 $11,078 $11,434
12/31/92 $11,617 $12,068
12/31/93 $12,913 $13,670
12/31/94 $12,247 $13,990
12/31/95 $15,276 $16,654
Var Gro & Inc S&P500 Lipper G&I
------------- ------------- ----------
1/31/91 $10,000 $10,000 $10,000
12/31/91 $10,340 $12,497 $12,030
12/31/92 $11,160 $13,448 $13,118
12/31/93 $12,465 $14,800 $14,735
12/31/94 $12,421 $14,995 $14,604
12/31/95 $16,862 $20,623 $19,093
Var S-T M-M ML 1-3 Trsy Lipper SWMM
------------ ----------- -------------
11/30/90 $10,000 $10,000 $10,000
12/31/90 $10,040 $10,115 $ 9,835
12/31/91 $10,734 $11,307 $10,646
12/31/92 $10,824 $12,044 $10,597
12/31/93 $11,540 $12,657 $11,238
12/31/94 $10,789 $12,835 $11,061
12/31/95 $11,518 $14,238 $11,919
14
<PAGE>
Var US Gov't LB Aggregate 67LBG/33LBC
------------ ------------- -----------
9/30/92 $10,000 $10,000 $10,000
12/31/92 $ 9,890 $10,027 $10,009
12/31/93 $10,800 $11,004 $11,126
12/31/94 $10,364 $10,683 $10,729
12/31/95 $12,360 $12,657 $12,836
Var Tot Return Lipper Bal 60 S&P/40 LGC
-------------- -------------- -------------
12/31/92 $10,000 $10,000 $10,000
12/31/93 $10,970 $10,889 $11,045
12/31/94 $10,557 $10,615 $10,976
12/31/95 $13,055 $13,324 $14,311
Variable Intl MSCI EAFE Lipper Intl
------------- --------- -----------
12/31/92 $10,000 $10,000 $10,000
12/31/93 $12,160 $13,294 $13,410
12/31/94 $12,975 $14,366 $13,315
12/31/95 $14,254 $16,026 $14,711
Var Glbl Dollar JP Morg Em Bd
--------------- -------------
5/2/94 $10,000 $10,000
10/31/94 $10,040 $10,590
4/30/95 $10,130 $ 9,833
10/31/95 $11,382 $11,438
12/31/95 $12,101 $12,736
Var North Am Leh Aggregate Leh Int GB
--------------- -------------- ----------
5/31/94 $10,000 $10,000 $10,000
6/30/94 $ 9,764 $ 9,978 $10,002
9/30/94 $10,020 $10,039 $10,079
12/31/94 $ 8,652 $10,077 $10,069
3/31/95 $ 8,504 $10,585 $10,487
6/30/95 $ 9,299 $11,230 $10,978
9/30/95 $ 9,866 $11,450 $11,148
12/31/95 $10,616 $11,938 $11,520
15
<PAGE>
Var Utility S&P500 NYSE Util Indx
------------- --------- --------------
5/10/94 $10,000 $10,000 $10,000
10/31/94 $10,300 $10,631 $ 9,664
4/30/95 $10,630 $11,742 $10,440
10/31/95 $11,552 $13,433 $11,649
12/31/95 $12,096 $14,310 $12,227
Var Growth Russell 1000 S&P500
--------------- -------------- -------
9/30/94 $10,000 $10,000 $10,000
12/31/94 $10,509 $ 9,961 $ 9,998
3/31/95 $11,178 $10,909 $10,971
6/30/95 $12,763 $11,936 $12,017
9/30/95 $13,941 $12,999 $12,971
12/31/95 $14,211 $13,723 $13,751
Var Worldwide MSCI EAFE
------------- ---------
9/30/94 $10,000 $10,000
12/31/94 $10,100 $ 9,905
3/31/95 $10,261 $10,097
6/30/95 $10,827 $10,178
9/30/95 $11,158 $10,611
12/31/95 $11,198 $11,049
Var Cons Inv Lehman Agg 30 SP/70 Leh Ag
-------------- -------------- ---------------
10/31/94 $10,000 $10,000 $10,000
12/31/94 $10,070 $10,047 $ 9,966
3/31/95 $10,410 $10,553 $10,609
6/30/95 $11,090 $11,196 $11,368
9/30/95 $11,300 $11,416 $11,806
12/31/95 $11,781 $11,902 $12,377
Var Gro Inv S&P500 70 SP/30 LAgg
-------------- -------------- -------------
10/31/94 $10,000 $10,000 $10,000
12/31/94 $ 9,860 $ 9,779 $ 9,859
3/31/95 $10,250 $10,730 $10,680
6/30/95 $10,938 $11,753 $11,591
9/30/95 $11,488 $12,686 $12,314
12/31/95 $11,879 $13,449 $12,996
16
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
<TABLE>
<S><C>
TEN LARGEST HOLDINGS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PREMIER GROWTH PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
PERCENT OF
COMPANY U.S. $ VALUE NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. .................... $1,475,150 5.0%
- ------------------------------------------------------------------------------------------------------------------------
Intel Corp. (common stock and warrants) ..... 1,330,394 4.5
- ------------------------------------------------------------------------------------------------------------------------
Norwest Corp. ............................... 871,200 3.0
- ------------------------------------------------------------------------------------------------------------------------
Hewlett-Packard Co. ......................... 871,000 3.0
- ------------------------------------------------------------------------------------------------------------------------
Applied Materials, Inc. ..................... 786,250 2.7
- ------------------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc. ................... 719,100 2.5
- ------------------------------------------------------------------------------------------------------------------------
Cisco Systems, Inc. ......................... 709,531 2.4
- ------------------------------------------------------------------------------------------------------------------------
AirTouch Communications, Inc. ............... 692,125 2.4
- ------------------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn .............. 682,688 2.3
- ------------------------------------------------------------------------------------------------------------------------
UAL Corp. ................................... 642,600 2.2
- ------------------------------------------------------------------------------------------------------------------------
$8,780,038 30.0%
- ------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. ................ $ 1,540,481 3.7%
- ------------------------------------------------------------------------------------------------------------------------
PepsiCo, Inc. ............................. 1,461,132 3.5
- ------------------------------------------------------------------------------------------------------------------------
Nabisco Holdings Corp. .................... 1,384,931 3.3
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. .................. 1,235,325 3.0
- ------------------------------------------------------------------------------------------------------------------------
Travelers, Inc. ........................... 1,188,337 2.8
- ------------------------------------------------------------------------------------------------------------------------
U.S. Healthcare, Inc. ..................... 1,072,706 2.6
- ------------------------------------------------------------------------------------------------------------------------
ALLTEL Corp. .............................. 1,025,125 2.4
- ------------------------------------------------------------------------------------------------------------------------
Century Telephone Enterprises, Inc. ....... 1,016,000 2.4
- ------------------------------------------------------------------------------------------------------------------------
Enron Corp. ............................... 895,937 2.1
- ------------------------------------------------------------------------------------------------------------------------
Sprint Corp. .............................. 893,200 2.1
- ------------------------------------------------------------------------------------------------------------------------
$11,713,174 27.9%
- ------------------------------------------------------------------------------------------------------------------------
17
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TEN LARGEST HOLDINGS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes $2,203,022 26.7%
- ------------------------------------------------------------------------------------------------------------------------
AT & T Corp. 194,250 2.4
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. 181,000 2.2
- ------------------------------------------------------------------------------------------------------------------------
Goodyear Tire & Rubber Co. 163,350 2.0
- ------------------------------------------------------------------------------------------------------------------------
PepsiCo, Inc. 145,275 1.8
- ------------------------------------------------------------------------------------------------------------------------
Travelers, Inc. 144,612 1.7
- ------------------------------------------------------------------------------------------------------------------------
U.S. Healthcare, Inc. 139,312 1.7
- ------------------------------------------------------------------------------------------------------------------------
Atlantic Richfield Co. 132,900 1.6
- ------------------------------------------------------------------------------------------------------------------------
Schering-Plough Corp. 131,400 1.6
- ------------------------------------------------------------------------------------------------------------------------
NationsBank Corp. 125,325 1.5
- ------------------------------------------------------------------------------------------------------------------------
$3,560,446 43.2%
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
DDI Corp. $ 286,683 1.7%
- ------------------------------------------------------------------------------------------------------------------------
Sumitomo Bank 254,528 1.5
- ------------------------------------------------------------------------------------------------------------------------
Toyota Corp. 212,106 1.3
- ------------------------------------------------------------------------------------------------------------------------
Fortis Amev N.V. 211,691 1.3
- ------------------------------------------------------------------------------------------------------------------------
Seven Eleven Japan 211,525 1.3
- ------------------------------------------------------------------------------------------------------------------------
Astra AB 200,755 1.2
- ------------------------------------------------------------------------------------------------------------------------
Indostat 199,650 1.2
- ------------------------------------------------------------------------------------------------------------------------
Nomura Securities Co. Ltd. 196,126 1.2
- ------------------------------------------------------------------------------------------------------------------------
Sakura Bank Ltd. 190,315 1.2
- ------------------------------------------------------------------------------------------------------------------------
Asahi Bank Ltd. 188,862 1.1
- ------------------------------------------------------------------------------------------------------------------------
$2,152,241 13.0%
- ------------------------------------------------------------------------------------------------------------------------
18
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TEN LARGEST HOLDINGS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
UTILITY INCOME PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
AT & T Corp. $ 379,435 6.1%
- ------------------------------------------------------------------------------------------------------------------------
AirTouch Communications, Inc. 307,812 4.9
- ------------------------------------------------------------------------------------------------------------------------
Texas Utilities Co. 287,875 4.6
- ------------------------------------------------------------------------------------------------------------------------
MCI Communications Corp. 282,825 4.5
- ------------------------------------------------------------------------------------------------------------------------
Public Service Co. of New Mexico 260,850 4.2
- ------------------------------------------------------------------------------------------------------------------------
New York State Electric & Gas Corp. 253,575 4.1
- ------------------------------------------------------------------------------------------------------------------------
Allegheny Power Systems 223,275 3.6
- ------------------------------------------------------------------------------------------------------------------------
Oklahoma Gas & Electric Co. 215,000 3.4
- ------------------------------------------------------------------------------------------------------------------------
Pinnacle West Capital Corp. 212,750 3.4
- ------------------------------------------------------------------------------------------------------------------------
DSC Communications Corp. 199,800 3.2
- ------------------------------------------------------------------------------------------------------------------------
$2,623,197 42.0%
- ------------------------------------------------------------------------------------------------------------------------
GROWTH PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Cisco Systems, Inc. $ 1,867,187 4.1%
- ------------------------------------------------------------------------------------------------------------------------
Telephone & Data Systems 1,694,550 3.8
- ------------------------------------------------------------------------------------------------------------------------
Travelers, Inc. 1,603,312 3.5
- ------------------------------------------------------------------------------------------------------------------------
3Com Corp. (common stock and conv. bond) 1,347,994 3.0
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. 1,176,500 2.6
- ------------------------------------------------------------------------------------------------------------------------
Tele-Communications, Inc. Cl.A 1,162,356 2.6
- ------------------------------------------------------------------------------------------------------------------------
Argyle Television, Inc. 1,148,850 2.5
- ------------------------------------------------------------------------------------------------------------------------
Westinghouse Electric Corp. 1,122,000 2.5
- ------------------------------------------------------------------------------------------------------------------------
Nokia Corp. (ADR) 1,088,500 2.4
- ------------------------------------------------------------------------------------------------------------------------
National Semiconductor Corp. 1,076,900 2.4
- ------------------------------------------------------------------------------------------------------------------------
$13,288,149 29.4%
- ------------------------------------------------------------------------------------------------------------------------
19
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TEN LARGEST HOLDINGS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
WORLDWIDE PRIVATIZATION PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Pharmacia & Upjohn, Inc. $ 155,000 2.6%
- ------------------------------------------------------------------------------------------------------------------------
East Japan Railway Co. 145,859 2.5
- ------------------------------------------------------------------------------------------------------------------------
Korea Mobile Telecommunications Corp. 134,850 2.3
- ------------------------------------------------------------------------------------------------------------------------
Indostat 127,050 2.1
- ------------------------------------------------------------------------------------------------------------------------
Lufthansa 123,911 2.1
- ------------------------------------------------------------------------------------------------------------------------
Viag AG 120,251 2.0
- ------------------------------------------------------------------------------------------------------------------------
Renault SA 115,173 1.9
- ------------------------------------------------------------------------------------------------------------------------
TAB Corp. Holdings Ltd. 98,856 1.7
- ------------------------------------------------------------------------------------------------------------------------
Telecomunicacoes Brasileras SA (ADR) 91,489 1.5
- ------------------------------------------------------------------------------------------------------------------------
Industrial Finance of Thailand 84,855 1.4
- ------------------------------------------------------------------------------------------------------------------------
$1,197,294 20.1%
- ------------------------------------------------------------------------------------------------------------------------
CONSERVATIVE INVESTORS PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds $2,528,631 34.1%
- ------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes 878,812 11.8
- ------------------------------------------------------------------------------------------------------------------------
Nynex Corp. 70,200 .9
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. 54,300 .7
- ------------------------------------------------------------------------------------------------------------------------
Gillette Co. 52,125 .7
- ------------------------------------------------------------------------------------------------------------------------
General Electric Co. 50,400 .7
- ------------------------------------------------------------------------------------------------------------------------
Pfizer, Inc. 50,400 .7
- ------------------------------------------------------------------------------------------------------------------------
Bank of New York Co., Inc. 48,750 .7
- ------------------------------------------------------------------------------------------------------------------------
General Reinsurance Corp. 46,500 .6
- ------------------------------------------------------------------------------------------------------------------------
American Express Co. 41,375 .6
- ------------------------------------------------------------------------------------------------------------------------
$3,821,493 51.5%
- ------------------------------------------------------------------------------------------------------------------------
20
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TEN LARGEST HOLDINGS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
GROWTH INVESTORS PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
COMPANY U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Notes $ 622,222 12.5%
- ------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds 601,943 12.1
- ------------------------------------------------------------------------------------------------------------------------
General Reinsurance Corp. 155,000 3.1
- ------------------------------------------------------------------------------------------------------------------------
Bank of New York Co., Inc. 146,250 2.9
- ------------------------------------------------------------------------------------------------------------------------
Philip Morris Cos., Inc. 135,750 2.7
- ------------------------------------------------------------------------------------------------------------------------
Gillette Co. 130,312 2.6
- ------------------------------------------------------------------------------------------------------------------------
Medtronic, Inc. 111,750 2.3
- ------------------------------------------------------------------------------------------------------------------------
Nynex Corp. 91,800 1.8
- ------------------------------------------------------------------------------------------------------------------------
American Express Co. 82,750 1.7
- ------------------------------------------------------------------------------------------------------------------------
Pfizer, Inc. 81,900 1.7
- ------------------------------------------------------------------------------------------------------------------------
$2,159,677 43.4%
- ------------------------------------------------------------------------------------------------------------------------
21
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INDUSTRY DIVERSIFICATION
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Basic Industries $ 1,156,083 7.0%
- ------------------------------------------------------------------------------------------------------------------------
Capital Goods 713,901 4.3
- ------------------------------------------------------------------------------------------------------------------------
Consumer Manufacturing 1,651,317 10.0
- ------------------------------------------------------------------------------------------------------------------------
Consumer Services 1,566,266 9.5
- ------------------------------------------------------------------------------------------------------------------------
Consumer Staples 1,984,123 12.0
- ------------------------------------------------------------------------------------------------------------------------
Energy 372,431 2.3
- ------------------------------------------------------------------------------------------------------------------------
Financial Services 4,433,041 26.8
- ------------------------------------------------------------------------------------------------------------------------
Healthcare 487,091 2.9
- ------------------------------------------------------------------------------------------------------------------------
Multi-Industry 420,412 2.5
- ------------------------------------------------------------------------------------------------------------------------
Technology 335,340 2.0
- ------------------------------------------------------------------------------------------------------------------------
Transportation 294,330 1.8
- ------------------------------------------------------------------------------------------------------------------------
Utilities 1,919,739 11.6
- ------------------------------------------------------------------------------------------------------------------------
Time Deposit 1,426,000 8.6
- ------------------------------------------------------------------------------------------------------------------------
Total Investments 16,760,074 101.3
- ------------------------------------------------------------------------------------------------------------------------
Cash and receivables, net of liabilities (218,439) (1.3)
- ------------------------------------------------------------------------------------------------------------------------
Net Assets $16,541,635 100.0%
- ------------------------------------------------------------------------------------------------------------------------
22
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INDUSTRY DIVERSIFICATION
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
WORLDWIDE PRIVATIZATION PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------
U.S. $ VALUE PERCENT OF NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
Basic Industries $ 316,133 5.3%
- ------------------------------------------------------------------------------------------------------------------------
Capital Goods 82,552 1.4
- ------------------------------------------------------------------------------------------------------------------------
Consumer Manufacturing 176,830 3.0
- ------------------------------------------------------------------------------------------------------------------------
Consumer Services 386,400 6.5
- ------------------------------------------------------------------------------------------------------------------------
Consumer Staples 111,212 1.9
- ------------------------------------------------------------------------------------------------------------------------
Energy 233,759 3.9
- ------------------------------------------------------------------------------------------------------------------------
Financial Services 619,372 10.4
- ------------------------------------------------------------------------------------------------------------------------
Healthcare 288,649 4.8
- ------------------------------------------------------------------------------------------------------------------------
Multi-Industry 300,537 5.0
- ------------------------------------------------------------------------------------------------------------------------
Technology 58,402 1.0
- ------------------------------------------------------------------------------------------------------------------------
Transportation 145,859 2.5
- ------------------------------------------------------------------------------------------------------------------------
Utilities 1,264,579 21.3
- ------------------------------------------------------------------------------------------------------------------------
Time Deposit 1,965,000 33.0
- ------------------------------------------------------------------------------------------------------------------------
Total Investments 5,949,284 100.0
- ------------------------------------------------------------------------------------------------------------------------
Cash and receivables, net of liabilities (2,510) 0.0
- ------------------------------------------------------------------------------------------------------------------------
Net Assets $5,946,774 100.0%
- ------------------------------------------------------------------------------------------------------------------------
23
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
PREMIER GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
COMMON STOCKS AND
OTHER INVESTMENTS--75.3%
CONSUMER SERVICES--17.3%
AIRLINES--4.5%
KLM Royal Dutch Airlines ......... 8,629 $ 304,172
Northwest Airlines Corp. Cl.A ....... 7,400 376,938
UAL Corp.* .......................... 3,600 642,600
----------
1,323,710
----------
BROADCASTING &
CABLE--6.0%
AirTouch Communications, Inc.* ......24,500 692,125
Cox Communications, Inc. Cl.A .......11,600 226,200
Liberty Media Group Cl.A* ........... 8,625 231,258
Tele-Communications, Inc. Cl.A* .....30,500 608,093
----------
1,757,676
----------
ENTERTAINMENT &
LEISURE--3.8%
ITT Corp............................ 10,600 561,800
Walt Disney Co...................... 9,100 536,900
----------
1,098,700
----------
RESTAURANTS &
LODGING--1.9%
McDonald's Corp..................... 12,200 550,525
----------
RETAILING--1.1%
Home Depot, Inc..................... 7,033 336,705
----------
5,067,316
----------
CONSUMER STAPLES--8.7%
COSMETICS--1.0%
Gillette Co......................... 5,800 302,325
-----------
FOOD--2.6%
Coca-Cola Co........................ 2,400 178,200
PepsiCo, Inc........................ 10,300 575,512
-----------
753,712
-----------
TOBACCO--5.1%
Philip Morris Cos., Inc............. 16,300 1,475,150
-----------
2,531,187
-----------
FINANCE--18.0%
BANKING & CREDIT--8.8%
Citicorp............................ 4,900 329,525
First Bank Systems, Inc. ........... 6,400 317,600
First Chicago NBD Corp. ............ 11,251 444,414
First Interstate Bancorp ........... 1,600 218,400
NationsBank Corp.................... 5,500 382,938
Norwest Corp........................ 26,400 871,200
-----------
2,564,077
-----------
BROKERAGE & MONEY
MANAGEMENT--2.4%
Merrill Lynch & Co., Inc. .......... 14,100 $ 719,100
------------
INSURANCE--3.3%
American International Group, Inc. . 4,300 397,750
General Reinsurance Corp. .......... 1,800 279,000
ITT Hartford Group, Inc. ........... 6,100 295,087
-------------
971,837
-------------
MORTGAGE BANKING--2.3%
Federal National Mortgage Assn. .... 5,500 682,688
-------------
OTHER--1.2%
MBNA Corp. ......................... 9,200 339,250
-------------
5,276,952
-------------
HEALTH CARE--7.4%
DRUGS--4.0%
Amgen, Inc.*........................ 7,600 450,775
Merck & Co., Inc.................... 5,800 381,350
Pfizer, Inc......................... 5,300 333,900
-----------
1,166,025
-----------
MEDICAL SERVICES--3.4%
Columbia/HCA Healthcare Corp. ...... 8,600 436,450
United Healthcare Corp. ............ 8,700 569,850
-------------
1,006,300
-------------
2,172,325
-------------
TECHNOLOGY--22.0%
COMMUNICATIONS
EQUIPMENT--5.2%
Cisco Systems, Inc.*................ 9,500 709,531
Ericsson (L.M.) Telephone Co. ...... 10,990 214,305
Nokia Corp. (ADR)................... 15,100 587,013
-----------
1,510,849
-----------
COMPUTER HARDWARE--4.4%
Compaq Computer Corp.* ............. 8,700 417,600
Hewlett-Packard Co. ................ 10,400 871,000
-------------
1,288,600
-------------
COMPUTER SOFTWARE &
SERVICES--4.2%
First Data Corp..................... 3,700 247,437
General Motors Corp. Cl.E .......... 5,500 286,000
Microsoft Corp.*.................... 4,800 421,500
Oracle Corp.*....................... 6,600 279,675
-----------
1,234,612
-----------
SEMI-CONDUCTORS &
RELATED--8.2%
Applied Materials, Inc.*............ 20,000 786,250
24
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
PREMIER GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
Intel Corp. ........................ 3,500 $ 198,844
warrants expiring 3/14/98* 42,400 1,131,550
Micron Technology, Inc. ............ 7,600 301,150
-------------
2,417,794
-------------
6,451,855
-------------
UTILITIES--1.9%
TELEPHONE--1.9%
AT & T Corp......................... 6,800 440,300
MCI Communications Corp. ........... 3,800 99,513
------------
539,813
------------
Total Common Stocks and
Other Investments
(cost $18,722,128) .............. 22,039,448
------------
SHORT-TERM INVESTMENTS--150.0%
TIME DEPOSIT--39.6%
State Street Bank and Trust Co.
5.50%, 1/02/96...................$11,594 11,594,000
-----------
COMMERCIAL PAPER--110.4%
American Express Co.
5.60%, 1/02/96................... 5,005 5,004,221
AT & T Capital Corp.
5.78%, 1/02/96................... 3,465 3,464,443
PRINCIPAL
AMOUNT
(000)
---------
Exxon Imperial U.S. Inc.
5.85%, 1/02/96................... $3,465 $ 3,464,437
Ford Motor Credit Corp.
5.85%, 1/02/96................... 5,005 5,004,187
General Electric Capital Corp.
5.95%, 1/02/96................... 5,003 5,002,173
Goldman Sachs Group L.P.
6.10%, 1/02/96................... 3,465 3,464,413
Nestle Capital Corp.
5.80%, 1/02/96................... 3,465 3,464,442
Prudential Funding
5.80%, 1/02/96................... 3,465 3,464,442
-----------
32,332,758
-----------
Total Short-Term Investments
(amortized cost $43,926,758) .... 43,926,758
-----------
TOTAL INVESTMENTS--225.3%
(cost $62,648,886)............... 65,966,206
Other assets less liabilities--(125.3%) (36,687,912)
-----------
NET ASSETS--100.0%.................. $29,278,294
===========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
See Notes to Financial Statements.
25
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GLOBAL BOND PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
BELGIUM--9.5%
GOVERNMENT/AGENCY--9.5%
Kingdom of Belgium
6.25%, 10/06/03 .......... DEM 850 $ 604,688
7.25%, 4/29/04 ........... BFR 14,000 497,397
-----------
Total Belgian Securities
(cost $1,088,820)......... 1,102,085
-----------
DENMARK--4.1%
GOVERNMENT/AGENCY--4.1%
Kingdom of Denmark
8.00%, 5/15/03 ........... DKK 1,000 191,464
9.00%, 11/15/00 .......... 1,400 280,504
-----------
Total Danish Securities
(cost $412,880) .......... 471,968
-----------
FINLAND--4.5%
GOVERNMENT/AGENCY--4.5%
Government of Finland
9.50%, 3/15/04
(cost $535,477) .......... FIM 2,000 524,348
-----------
IRELAND--4.4%
GOVERNMENT/AGENCY--4.4%
Republic of Ireland
8.00%, 10/18/00
(cost $487,385) .......... IEP 300 504,803
-----------
ITALY--4.6%
GOVERNMENT/AGENCY--4.6%
Republic of Italy
10.50%, 4/01/05
(cost $504,652) ......... LIRA 850,000 531,958
-----------
JAPAN--8.4%
CORPORATE OBLIGATIONS--8.4%
Export Import Bank of Japan
4.375%, 10/01/03 ......... JPY 55,000 585,290
International Bank for
Reconstruction & Development
4.50%, 6/20/00 ........... 35,000 378,602
-----------
Total Japanese Securities
(cost $978,240) .......... $ 963,892
-----------
SPAIN--9.1%
GOVERNMENT/AGENCY--9.1%
Government of Spain
11.30%, 1/15/02 ESP 60,000 530,256
Kingdom of Spain
8.00%, 5/30/04 ........... 70,000 523,124
-----------
Total Spanish Securities
(cost $1,029,689)......... 1,053,380
-----------
SWEDEN--4.9%
GOVERNMENT/AGENCY--4.9%
Kingdom of Sweden
10.25%, 5/05/03
(cost $505,309)........... SEK 3,400 564,897
-----------
UNITED KINGDOM--4.8%
GOVERNMENT/AGENCY--4.8%
U.K. Treasury
8.00%, 6/10/03
(cost $545,235) .......... GBP 340 551,958
-----------
UNITED STATES--42.4%
GOVERNMENT/AGENCY--41.3%
U.S. Treasury Notes
6.375%, 8/15/02 (a)....... US$ 2,150 2,254,469
7.875%, 8/15/01 .......... 2,250 2,512,957
-----------
4,767,426
-----------
TIME DEPOSIT--1.1%
State Street Bank and Trust Co.
5.4375%, 1/02/96 ......... 133 133,000
-----------
Total United States Securities
(cost $4,774,643) ........ 4,900,426
-----------
TOTAL INVESTMENTS--96.7%
(cost $10,862,330)........ 11,169,715
Other assets less liabilities--3.3% 383,262
-----------
NET ASSETS--100.0%............ $11,552,977
===========
- ------------------------------------------------------------------------------------------------------------------------
(a) Security segregated to collateralize forward exchange currency contracts
with an aggregate market value of $2,254,469. See Notes to Financial
Statements.
26
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
COMMON STOCKS--84.3%
BASIC INDUSTRIES--5.5%
CHEMICALS--4.1%
Monsanto Co. ....................... 6,700 $ 820,750
Rohm & Haas Co. .................... 2,750 177,031
Union Carbide Corp. ................ 19,100 716,250
-----------
1,714,031
-----------
POLLUTION CONTROL--1.4%
WMX Technologies, Inc. ............. 20,400 609,450
-----------
2,323,481
-----------
CAPITAL GOODS--4.2%
ELECTRICAL EQUIPMENT--1.4%
General Electric Co. ............... 8,200 590,400
-----------
MACHINERY--2.8%
Allied-Signal, Inc.................. 7,000 332,500
BWIP Holdings, Inc. Cl.A............ 18,450 299,812
Coltec Industries, Inc.* ........... 36,950 429,544
Giddings & Lewis, Inc., Wisconsin... 7,800 127,725
-----------
1,189,581
-----------
1,779,981
-----------
CONSUMER
MANUFACTURING--3.7%
AUTO & RELATED--3.7%
Goodyear Tire & Rubber Co. ......... 33,950 1,540,481
------------
CONSUMER SERVICES--8.6%
BROADCASTING &
CABLE--3.1%
Comcast Corp. Cl.A SPL ............. 9,900 180,056
Liberty Media Group Cl.A*........... 14,000 375,375
Tele-Communications, Inc. Cl.A*..... 20,000 398,750
Vodafone Group PLC (ADR)............ 9,450 333,113
-----------
1,287,294
-----------
ENTERTAINMENT &
LEISURE--0.8%
Eastman Kodak Co.................... 5,100 341,700
-----------
RETAILING--4.7%
Federated Department Stores, Inc.*.. 12,650 347,875
Kroger Co.*......................... 9,050 339,375
Lowes Cos., Inc..................... 24,950 835,825
Nordstrom, Inc...................... 7,500 302,812
Pep Boys Manny, Moe & Jack.......... 5,900 151,188
-----------
1,977,075
-----------
3,606,069
-----------
CONSUMER STAPLES--11.6%
FOOD--8.6%
Campbell Soup Co.................... 13,000 $ 780,000
Nabisco Holdings Corp............... 42,450 1,384,931
PepsiCo, Inc........................ 26,150 1,461,132
-----------
3,626,063
-----------
TOBACCO--3.0%
Philip Morris Cos., Inc............. 13,650 1,235,325
-----------
4,861,388
-----------
ENERGY--4.8%
DOMESTIC INTEGRATED--1.0%
Atlantic Richfield Co............... 3,700 409,775
-----------
DOMESTIC PRODUCERS--0.8%
Renaissance Energy Ltd.* .......... 13,500 336,141
-----------
OIL & GAS SERVICES--0.9%
Western Atlas, Inc.*................ 7,350 371,175
-----------
PIPELINES--2.1%
Enron Corp.......................... 23,500 895,937
-----------
2,013,028
-----------
FINANCE--11.1%
BANKING & CREDIT--5.6%
BankAmerica Corp.................... 5,600 362,600
First Chicago NBD Corp. ............ 17,648 697,096
Fleet Financial Group, Inc.......... 18,100 737,575
NationsBank Corp.................... 7,750 539,594
-----------
2,336,865
-----------
BROKERAGE & MONEY
MANAGEMENT--1.2%
Merrill Lynch & Co., Inc. .......... 10,200 520,200
-----------
INSURANCE--4.3%
Allstate Corp....................... 15,150 621,150
Travelers, Inc...................... 18,900 1,188,337
-----------
1,809,487
-----------
4,666,552
-----------
HEALTH CARE--9.7%
BIOTECHNOLOGY--1.3%
Centocor, Inc....................... 17,600 545,600
-----------
DRUGS--4.3%
AB Astra (ADR)...................... 14,400 575,807
Lilly (Eli) & Co.................... 8,498 478,013
Schering-Plough Corp................ 13,650 747,337
-----------
1,801,157
-----------
27
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH AND INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
MEDICAL SERVICES--4.1%
Columbia/HCA Healthcare Corp. 13,200 $ 669,900
U.S. Healthcare, Inc. ....... 23,100 1,072,706
----------
1,742,606
-----------
4,089,363
-----------
TECHNOLOGY--12.8%
AEROSPACE & DEFENSE--1.6%
Boeing Co. .................. 4,250 333,094
General Motors Corp. Cl.H ... 7,150 351,244
----------
684,338
-----------
COMMUNICATIONS
EQUIPMENT--4.9%
DSC Communications Corp.* ... 18,000 666,000
General Instrument Corp.* ... 27,550 643,981
Nokia Corp. (ADR) ........... 18,800 730,850
----------
2,040,831
-----------
COMPUTER HARDWARE--2.6%
Compaq Computer Corp.* ...... 7,050 338,400
International Business
Machines Corp. ........... 8,050 738,588
----------
1,076,988
-----------
SEMI-CONDUCTORS &
RELATED--3.7%
Intel Corp. ................. 14,800 840,825
National Semiconductor Corp.* 32,373 720,299
----------
1,561,124
-----------
5,363,281
-----------
TRANSPORTATION--0.9%
TRUCKING--0.9%
Xtra Corp. .................. 9,000 382,500
----------
UTILITIES--11.4%
ELECTRIC & GAS--2.4%
FPL Group, Inc. ............. 6,650 308,394
Houston Industries, Inc. .... 15,100 366,175
Portland General Corp. ...... 11,900 346,587
----------
1,021,156
-----------
SHARES OR
PRINCIPAL
AMOUNT
(000)
-----------
TELEPHONE--9.0%
ALLTEL Corp. ................ 34,750 $1,025,125
AT & T Corp. ................ 12,700 822,325
Century Telephone
Enterprises, Inc. ........ 32,000 1,016,000
Sprint Corp. ................ 22,400 893,200
----------
3,756,650
-----------
4,777,806
-----------
Total Common Stocks
(cost $30,937,072) ....... 35,403,930
----------
SHORT-TERM INVESTMENTS--101.4%
U.S. GOVERNMENT
OBLIGATIONS--79.5%
Federal Agricultural
Mortgage Corp. ...........
5.45%, 1/02/96 .............. 3,400 3,399,485
Federal Home Loan Bank
5.75%, 1/02/96 ........... 10,000 9,998,403
Federal Home Loan Mortgage Corp.
5.75%, 1/02/96 ........... 10,000 9,998,403
Student Loan Marketing Assn .
5.65%, 1/02/96 ........... 10,000 9,998,431
----------
33,394,722
-----------
COMMERCIAL PAPER--21.9%
American Express Co. ........
5.65%, 1/02/96 ........... 9,200 9,198,556
----------
Total Short-Term Investments
(amortized cost $42,593,278) 42,593,278
----------
TOTAL INVESTMENTS--185.7%
(cost $73,530,350) ....... 77,997,208
Other assets less liabilities--(85.7%) (36,004,380)
-----------
NET ASSETS--100.0% .......... $41,992,828
==========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
See Notes to Financial Statements.
28
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
SHORT-TERM MULTI-MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
AUSTRALIA--3.5%
GOVERNMENT/AGENCY--3.5%
Commonwealth of Australia
7.00%, 8/15/98 (a)
(cost $111,897) ....... AUD 150 $ 110,494
----------
CANADA--1.7%
GOVERNMENT/AGENCY--1.7%
Government of Canada
6.50%, 9/01/98 (a)
(cost $53,412) ....... CAD 75 55,414
-----------
DENMARK--7.5%
GOVERNMENT/AGENCY--7.5%
Kingdom of Denmark
9.00%, 11/15/98 (a)
(cost $236,626)......... DKK 1,200 235,418
-----------
FRANCE--2.6%
GOVERNMENT/AGENCY--2.6%
Government of France
5.75%, 11/12/98 (a)
(cost $82,319) ......... FRF 400 82,671
-----------
GERMANY--7.1%
GOVERNMENT/AGENCY--7.1%
Federal Republic of Germany
6.875%, 12/02/98 (a)
(cost $223,648) ........ DEM 300 223,876
-----------
IRELAND--4.4%
GOVERNMENT/AGENCY--4.4%
Republic of Ireland
9.75%, 6/01/98 (a)
(cost $137,617) ........ IEP 80 138,264
-----------
NEW ZEALAND--8.5%
GOVERNMENT/AGENCY--8.5%
New Zealand Treasury Bonds
10.00%, 7/15/97 (a)
(cost $278,005) ........ NZD 400 $ 268,698
-----------
SPAIN--8.0%
GOVERNMENT/AGENCY--8.0%
Kingdom of Spain
9.90%, 10/31/98 (a)
(cost $245,397) ........ ESP 30,000 251,674
----------
UNITED KINGDOM--3.3%
GOVERNMENT/AGENCY--3.3%
U.K. Treasury
7.25%, 3/30/98 (a)
(cost $103,521) ........ GBP 65 102,840
----------
UNITED STATES--290.0%
TIME DEPOSIT--290.0%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost
$9,140,000)............. US$ 9,140 9,140,000
-----------
TOTAL INVESTMENTS--336.6%
(cost $10,612,442) 10,609,349
Other assets less liabilities--(236.6%) (7,457,271)
-----------
NET ASSETS--100.0%.......... $3,152,078
==========
- ------------------------------------------------------------------------------------------------------------------------
(a) Securities segregated to collateralize forward exchange currency contracts with an aggregate market value of $1,469,349.
See Notes to Financial Statements.
29
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
PREFERRED STOCKS--0.3%
FINANCE--0.3%
Banesto Holdings Ltd. cv. pfd.
Series A 10.50% (a)
(cost $49,725) ........... 1,800 $ 55,215
----------
CORPORATE OBLIGATIONS--20.3%
ASSET BACKED--0.6%
MBNA Master Credit Card
Trust Cl.A
5.40%, 9/15/00 ........... $ 100 99,531
----------
FINANCE--18.5%
Abbey National Plc
6.69%, 10/17/05 .......... 500 518,915
BankAmerica Corp. ...........
7.20%, 4/15/06 ........... 100 106,531
Farmers Insurance Exchange
8.625%, 5/01/24 (a) ...... 250 250,668
General Motors Acceptance Corp.
7.125%, 6/01/99 .......... 500 519,205
Goldman Sachs Group L.P. ....
7.25%, 10/01/05 .......... 500 523,450
Merrill Lynch & Co., Inc. ...
6.25%, 10/15/08 .......... 531 519,780
St. George Bank Ltd. ........
7.15%, 10/15/05 .......... 500 517,530
TCI Communications, Inc. ....
8.75%, 8/01/15 ........... 100 110,867
Wachovia Corp. ..............
6.375%, 4/15/03 .......... 75 76,442
----------
3,143,388
-----------
YANKEES--1.2%
Republic of Italy
6.875%, 9/27/23 .......... 200 195,310
----------
Total Corporate Obligations
(cost $3,236,031) ........ 3,438,229
----------
U.S. GOVERNMENT
OBLIGATIONS--65.1%
U.S. TREASURY SECURITIES--42 9%
U.S. Treasury Bonds
7.125%, 2/15/23 (b) ...... 685 783,256
7.625%, 2/15/25 ............. 670 819,283
11.25%, 2/15/15 .......... 500 800,390
U.S. Treasury Notes
7.125%, 9/30/99 .......... 2,380 2,523,538
7.25%, 8/15/04 ........... 1,790 1,990,533
7.75%, 3/31/96 ........... 350 352,023
----------
7,269,023
-----------
FEDERAL AGENCY-MORTGAGES--4.6%
Federal Home Loan Mortgage Corp./
Government National Mortgage Assn.
4.75%, 7/25/11 ........... 400 394,124
Government National Mortgage Assn.
7.00%, 7/15/23 ........... 88 88,577
8.00%, 1/15/24 ........... 135 140,255
9.00%, 9/15/24 ........... 146 154,321
----------
777,277
-----------
FEDERAL AGENCY--17.6%
AID - Israel
8.00%, 11/15/01 .......... 200 222,884
Federal Home Loan Bank
7.26%, 9/06/01 ........... 300 323,109
Federal Home Loan Mortgage Corp.
6.13%, 8/19/99 ........... 200 204,062
Federal National Mortgage Assn.
6.05%, 1/12/98 ........... 100 101,344
6.85%, 4/05/04 ........... 100 106,656
Overseas Private Investment Corp.
6.08%, 8/15/04 ........... 1,000 1,012,780
Student Loan Marketing Assn .
6.05%, 9/14/00 ........... 1,000 1,018,280
----------
2,989,115
-----------
Total U.S. Government Obligations
(cost $10,684,602)........... 11,035,415
-----------
SOVEREIGN DEBT
OBLIGATIONS--12.4%
AUSTRALIA--3.5%
Commonwealth of Australia
10.00%, 10/15/07 (b)..... AUD 700 586,675
-----------
CANADA--4.8%
Government of Canada
8.75%, 12/01/05 (b) .... CAD 1,000 818,491
-----------
30
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
-------- -----------
GERMANY--4.1%
Federal Republic of Germany
7.375%, 1/03/05.............. DEM 900 $ 685,619
-----------
Total Sovereign Debt Obligations
(cost $2,055,124) ........... 2,090,785
-----------
SHORT-TERM INVESTMENTS--3.4%
TIME DEPOSIT--3.4%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost $573,000) ... $573 573,000
----------
TOTAL INVESTMENTS--101.5%
(cost $16,598,482)............... $17,192,644
Other assets less liabilities--(1.5%) (246,125)
-----------
NET ASSETS--100.0%................... $16,946,519
===========
- ------------------------------------------------------------------------------------------------------------------------
(a) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration normally applied to certain qualified buyers. At December 31,
1995, the aggregate market value of these securities amounted to $305,883
or 1.8% of net assets.
(b) Securities segregated to collateralize forward exchange currency contracts
with an aggregate market value of $2,188,422. See Notes to Financial
Statements.
31
<PAGE>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TOTAL RETURN PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
COMMON STOCKS--59.0%
BASIC INDUSTRIES--3.8%
CHEMICALS--2.4%
Monsanto Co. ................ 130 $ 15,925
Morton International, Inc. .. 1,300 46,637
Rohm & Haas Co. ............. 700 45,063
Union Carbide Corp. ......... 2,400 90,000
----------
197,625
----------
METALS & MINING--0.2%
Alumax, Inc* ................ 600 18,375
----------
PAPER & FOREST
PRODUCTS--1.0%
Kimberly Clark Corp. ........ 1,000 82,750
----------
OTHER--0.2%
Alco Standard Corp. ......... 400 18,250
----------
317,000
----------
CAPITAL GOODS--3.4%
ELECTRICAL EQUIPMENT--1.3%
General Electric Co. ........ 1,500 108,000
----------
MACHINERY--1.2%
Allied-Signal, Inc. ......... 2,000 95,000
Paccar, Inc. ................ 100 4,212
----------
99,212
----------
POLLUTION CONTROL--0.9%
WMX Technologies, Inc. ...... 2,500 74,688
----------
281,900
----------
CONSUMER
MANUFACTURING--2.7%
AUTO & RELATED--2.7%
Goodyear Tire & Rubber Co. .. 3,600 163,350
Magna International, Inc.* .. 1,400 60,550
----------
223,900
----------
CONSUMER SERVICES--8.2%
BROADCASTING &
CABLE--1.4%
AirTouch Communications, Inc. 3,500 98,875
Cox Communications, Inc. Cl.A 900 17,550
----------
116,425
----------
ENTERTAINMENT &
LEISURE--2.5%
Carnival Corp. Cl.A ......... 3,900 95,062
Eastman Kodak Co. ........... 900 60,300
ITT Corp. ................... 200 10,600
Walt Disney Co. ............. 700 41,300
----------
207,262
----------
RESTAURANTS &
LODGING--1.6%
McDonald's Corp. ............ 1,200 54,150
Wendy's International, Inc. . 3,600 $ 76,500
----------
130,650
----------
RETAILING--2.7%
Federated Department Stores,
Inc*........................ 3,300 90,750
Lowes Cos., Inc. ............ 2,500 83,750
May Department Stores Co. ... 800 33,800
Pep Boys Manny, Moe & Jack .. 400 10,250
----------
218,550
----------
672,887
----------
CONSUMER STAPLES--6.4%
COSMETICS--1.0%
Gillette Co. ................ 1,500 78,188
----------
FOOD--2.9%
Campbell Soup Co. ........... 1,600 96,000
PepsiCo, Inc. ............... 2,600 145,275
----------
241,275
----------
HOUSEHOLD PRODUCTS--0.3%
Colgate-Palmolive Co. ....... 400 28,100
----------
TOBACCO--2.2%
Philip Morris Cos., Inc. .... 2,000 181,000
----------
528,563
----------
ENERGY--3.5%
DOMESTIC INTEGRATED--1.6%
Atlantic Richfield Co. ...... 1,200 132,900
----------
OIL & GAS SERVICES--0.4%
Western Atlas, Inc.* ........ 600 30,300
----------
PIPELINES--1.5%
Enron Corp. ................. 3,200 122,000
----------
285,200
----------
FINANCE--10.7%
BANKING & CREDIT--4.4%
BankAmerica Corp. ........... 900 58,275
First Chicago NBD Corp. ..... 2,672 105,544
MBNA Corp. .................. 1,500 55,312
NationsBank Corp. ........... 1,800 125,325
Republic New York Corp. ..... 300 18,638
----------
363,094
----------
BROKERAGE & MONEY
MANAGEMENT--1.4%
Merrill Lynch & Co., Inc. ... 2,200 112,200
----------
INSURANCE--3.3%
American International Group,
Inc ........................ 900 83,250
ITT Hartford Group, Inc. .... 100 4,838
PMI Group, Inc. ............. 800 36,200
Travelers, Inc. ............. 2,300 144,612
----------
268,900
----------
32
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
TOTAL RETURN PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
MORTGAGE BANKING--0.4%
Federal National Mortgage Assn. 300 $ 37,237
----------
OTHER--1.2%
Dean Witter, Discover & Co. . 2,200 103,400
----------
884,831
----------
HEALTH CARE--9.3%
BIOTECHNOLOGY--0.3%
Centocor, Inc. .............. 900 27,900
----------
DRUGS--4.2%
Bristol-Myers Squibb Co. .... 1,100 94,463
Lilly (Eli) & Co. ........... 2,100 118,125
Schering-Plough Corp. ....... 2,400 131,400
----------
343,988
----------
MEDICAL SERVICES--4.8%
Columbia/HCA Healthcare Corp. 2,400 121,800
Healthsource, Inc.* ......... 800 28,800
U.S. Healthcare, Inc. ....... 3,000 139,312
United Healthcare Corp. ..... 1,100 72,050
Value Health, Inc. .......... 1,100 30,250
----------
392,212
----------
764,100
----------
TECHNOLOGY--5.4%
AEROSPACE & DEFENSE--0.9%
Boeing Co. .................. 900 70,537
----------
COMMUNICATIONS
EQUIPMENT--0.2%
General Instrument Corp.* ... 700 16,363
----------
COMPUTER HARDWARE--1.6%
Compaq Computer Corp.* ...... 2,100 100,800
International Business
Machines Corp. ........... 300 27,525
----------
128,325
----------
COMPUTER SOFTWARE--0.6%
General Motors Corp. Cl.E ... 1,000 52,000
----------
ELECTRONICS--0.0%
ITT Industries, Inc. ........ 200 4,800
----------
SEMI-CONDUCTORS &
RELATED--2.1%
Applied Materials, Inc.* .... 200 7,863
----------
SHARES OR
PRINCIPAL
AMOUNT
---------
Intel Corp. ................. 1,700 $ 96,581
National Semiconductor Corp.* 3,200 71,200
----------
175,644
----------
447,669
----------
TRANSPORTATION--0.2%
RAILROADS & EQUIPMENT--0.2%
Conrail, Inc. ............... 100 7,000
Illinois Central Corp. ...... 130 4,989
----------
11,989
----------
UTILITIES--5.4%
ELECTRIC & GAS--2.3%
FPL Group, Inc. ............. 2,000 92,750
Houston Industries, Inc. .... 4,000 97,000
----------
189,750
----------
TELEPHONE--3.1%
AT & T Corp. ................ 3,000 194,250
Century Telephone
Enterprises, Inc. ........ 2,000 63,500
----------
257,750
----------
447,500
----------
Total Common Stocks
(cost $4,501,199) ........ 4,865,539
----------
U.S. GOVERNMENT
OBLIGATIONS--26.7%
U.S. Treasury Notes
4.75%, 8/31/98 ..............$ 817 807,425
7.25%, 8/15/04 ........... 1,255 1,395,597
----------
Total U.S. Government Obligations
(cost $2,151,363) ........ 2,203,022
----------
SHORT-TERM INVESTMENTS--19.5%
TIME DEPOSIT--19.5%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost $1,604,000) 1,604 1,604,000
----------
TOTAL INVESTMENTS--105.2%
(cost $8,256,562) ........ 8,672,561
Other assets less liabilities--
(5.2%) .................... (430,120)
----------
NET ASSETS--100.0% .......... $8,242,441
==========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
See Notes to Financial Statements.
33
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
COMMON STOCKS--92.7%
AUSTRALIA--1.7%
Coca Cola Amatil Ltd. ....... 11,086 $ 88,414
Mayne Nickless Ltd. ......... 3,891 17,353
National Australia Bank Ltd. 7,000 62,955
Qantas Airways Ltd. ......... 4,456 7,419
Woolworths Ltd. ............. 43,939 105,814
----------
281,955
----------
BELGIUM--0.5%
Kredietbank S.A ............. 280 76,589
----------
BRAZIL--0.1%
Pan American Beverage ....... 600 19,200
----------
DENMARK--0.9%
Den Danske Bank ............. 2,150 148,303
----------
FINLAND--1.3%
Metsa-Serla Cl.B ............ 1,470 45,289
Nokia AB Cl.A ............... 2,488 97,817
Unitas Bank Ltd.* ........... 29,800 75,367
----------
218,473
----------
FRANCE--9.0%
Banque National de Paris .... 2,218 100,052
Bouygues .................... 710 71,522
Casino Guichard Perrachon ... 1,620 47,207
Compagnie Financiere de
Paribas S.A .............. 1,319 72,320
Compagnie Generale des Eaux . 1,147 114,513
Credit Foncier de France .... 820 11,855
Group Danone (a) ............ 784 129,359
Klepierre ................... 180 21,135
Legris Ind. S.A.* ........... 800 26,041
Peugeot PSA Peugeot Citroen (a) 910 120,045
Salomon S.A ................. 130 75,659
Sanofi S.A .................. 970 62,178
Sefimeg ..................... 495 32,852
Seita ....................... 2,200 79,743
Simco ....................... 560 53,175
Simco (New) ................. 8 697
Societe Centrale des Assurances
Generales de France (a) .. 3,370 112,861
Societe des Immeub .......... 455 27,131
Societe Television Francaise 610 65,397
Total S.A. (ADR) ............ 1,246 42,364
Total S.A. Cl.B ............. 914 61,686
Union du Credit Bail Immobil 640 66,130
Union Immob France .......... 300 25,975
Usinor Sacilor* ............. 5,300 $ 70,079
----------
1,489,976
----------
GERMANY--5.5%
Bayer Motoren Werke AG (a) .. 568 149,870
Deutsche Bank AG (a) ........ 3,430 162,522
Henkel Kgaa, Pfd. ........... 300 112,827
KSB (a) ..................... 105 17,201
KSB AG - Vorzug Pfd. ........ 350 39,038
Lufthansa AG ................ 680 93,621
Schmalbach Lubeca AG ........ 340 47,830
Suedzucker AG ............... 176 95,085
Varta AG* ................... 300 57,511
Veba AG ..................... 3,100 131,607
----------
907,112
----------
HONG KONG--2.3%
Citic Pacific, Ltd. ......... 15,000 51,309
Consolidated Electric Power
Asia Ltd. ................ 34,000 61,778
Dao Heng Bank Group Ltd. .... 15,000 53,928
Hong Kong and China Gas Co. Ltd.10,200 16,423
Hopewell Holdings Ltd. ...... 82,000 47,190
Hysan Development Co. Ltd. .. 7,000 18,513
Johnson Electric Holdings Ltd. 13,000 23,201
New World Development Co. Ltd. 4,165 18,152
Sun Hung Kai Properties Ltd. 3,000 24,539
Television Broadcasts of
Hong Kong Ltd. ........... 12,000 42,755
Yizheng Chemical Fibre ......... 24,303
----------
382,091
----------
INDIA--0.3%
Bajaj Auto Ltd. (GDR)* (b) .. 2,100 53,802
----------
INDONESIA--2.0%
HM Sampoerna ................ 9,500 98,885
Indosat ..................... 55,000 199,650
Perusahaan Persero Part
Telekom* ................... 1,000 25,250
----------
323,785
----------
IRELAND--0.4%
Irish Life Plc .............. 2,000 7,703
Irish Life Plc (Dublin Listing) 17,427 66,126
----------
73,829
ITALY--1.8%
Ente Nazionale Idrocarburi
S.p.A.* .................... 24,500 85,620
La Rinascente S.p.A ......... 15,155 91,705
Societa Italiana Per L'Eserreizio
Delle Telecommunicazioni,
P.A.* .................... 47,700 74,187
Telecom Italia Mobile S.p.A . 37,800 39,749
----------
291,261
----------
34
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
JAPAN--36.3%
Amano Corp. ............................ 6,000 $ 75,545
Asahi Bank Ltd. ........................ 15,000 188,862
Asahi Glass Co. Ltd. ................... 11,000 122,518
Bank of Tokyo (a) ...................... 5,000 87,651
Canon, Inc. ............................ 2,000 36,223
Chiba Bank ............................. 3,000 27,022
Dai Nippon Printing Co. Ltd. ........... 4,000 67,797
Daifuku Co. ............................ 4,000 56,562
Daito Trust Construction ............... 300 3,545
Daiwa House Industry Co. Ltd. .......... 2,000 32,930
Daiwa Securities Co. Ltd. .............. 2,000 30,605
DDI Corp. (a) .......................... 37 286,683
East Japan Railway Co. ................. 21 102,102
Fuji Bank Ltd. ......................... 8,000 176,659
Fuji Photo Film Co. (ORD) .............. 1,000 28,862
Furukawa Co. Ltd. ...................... 6,000 29,695
Heiwa Corp. ............................ 3,000 78,160
Hirose Electric Co. .................... 1,000 57,530
Hokkaido Takushoku Bank Ltd. ........... 9,000 26,673
Honda Motor Co. ........................ 3,000 61,889
House Food Industry .................... 2,000 36,029
Hoya Corp. ............................. 1,000 34,383
Ito - Yokado Co. Ltd. .................. 1,000 61,598
Japan Securities Finance ............... 5,000 71,671
Kajima Corp. ........................... 1,000 9,879
Kamigumi Co. Ltd. ...................... 5,000 47,990
Kandenko Co. Ltd. ...................... 3,000 37,482
Kao Corp. .............................. 9,000 111,574
Kirin Brewery Co. Ltd. ................. 4,000 47,264
Kokuyo ................................. 1,000 23,244
Kuraray Co. Ltd. ....................... 8,000 87,554
Long-Term Credit Bank of Japan ......... 2,000 17,046
Mabuchi Motor .......................... 1,000 62,179
Maeda Road Construction ................ 1,000 18,499
Matsushita Electric Works .............. 6,000 63,341
Matsushita Electrical Industries ....... 8,000 130,169
Mitsubishi Bank ........................ 8,000 188,281
Mitsubishi Heavy Industries Ltd. ....... 7,000 55,797
Mitsubishi Materials Corp. ............. 6,000 31,090
Mitsubishi Oil Co. ..................... 6,000 53,288
Mitsui Marine & Fire ................... 7,000 49,898
Mitsui Trust and Banking Co. Ltd. ...... 17,000 186,053
Mori Seiki ............................. 1,000 22,567
National House Industrial Co. .......... 2,000 36,610
NGK Insulators ......................... 4,000 39,903
Nikko Securities Co. Ltd. .............. 5,000 64,407
Nintendo Corp. Ltd. .................... 700 $ 53,220
Nippon Express Co. Ltd. ................ 5,000 48,136
Nippon Light Metal Co. ................. 6,000 34,402
Nippon Paper Industries Co. ............ 2,000 13,889
Nippon Steel Corp. ..................... 16,000 54,857
Nippon Telegraph and
Telephone Corp. ..................... 8 64,697
Nisshin Steel Co. Ltd. ................. 15,000 60,581
NKK Corp.* ............................. 20,000 53,850
Nomura Securities Co. Ltd. ............. 9,000 196,126
Nomura Securities Ltd. (ADR) ........... 226 49,296
Osaka Gas Co. .......................... 15,000 51,864
Rohm Co. ............................... 2,000 112,930
Sakura Bank Ltd. ....................... 15,000 190,315
Sankyo Co. Ltd. ........................ 1,000 22,470
Sega Enterprises ....................... 1,000 55,206
Seven Eleven Japan ..................... 3,000 211,525
Shimano, Inc. .......................... 2,000 35,254
Shimizu Corp. .......................... 6,000 61,017
Shiseido Co. Ltd. ...................... 5,000 59,564
Sumitomo Bank (a) ...................... 12,000 254,528
Sumitomo Electric Industries ........... 4,000 48,039
Sumitomo Marine & Fire ................. 5,000 41,065
Sumitomo Realty & Development .......... 8,000 56,562
Sumitomo Rubber Ind .................... 3,000 25,046
Taisho Pharmaceutical Co. .............. 3,000 59,274
Takeda Chemical Industries ............. 3,000 49,395
Toagosei Co. Ltd. ...................... 3,000 15,922
Tokai Bank ............................. 7,000 97,627
Tokyo Electric Power ................... 3,000 80,194
Tokyo Gas Cos. Ltd. .................... 26,000 91,661
Tokyo Steel Manufacturing .............. 6,000 110,412
Tostem Corp. ........................... 3,000 99,661
Toyo Kanetsu Kk ........................ 5,000 25,617
Toyota Corp. ........................... 10,000 212,106
Ube Industries Ltd.* ................... 4,000 15,109
Yakult Honsha Co. ...................... 2,000 27,312
Yamanouchi Pharmaceutical .............. 2,000 43,002
Yamazaki Baking Co. Ltd. ............... 3,000 55,787
------------
6,002,827
------------
KOREA--0.9%
Korea Electric Power Corp. .............
(ADR) ............................... 2,200 58,300
Korea Mobile Telecommunications
Corp. (GDR) (b) ..................... 1,000 43,500
Pohang Iron & Steel Ltd. (ADR) ......... 2,000 43,750
----------
145,550
----------
35
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
MALAYSIA--2.0%
Ammb Holdings Bhd ...................... 5,000 $ 57,093
DCB Holdings Bhd, warrants* ............ 2,750 2,729
Malakoff Bhd ........................... 13,000 46,324
Petronas Gas Bhd* ...................... 10,000 34,059
Rashid Hussain Bhd ..................... 5,000 14,962
Resorts World Bhd ...................... 13,000 69,615
Telekom Malaysia ....................... 13,000 101,351
----------
326,133
----------
MEXICO--0.0%
Telefonos de Mexico S.A ................
Series L (ADR) ...................... 200 6,375
----------
NETHERLANDS--2.8%
European Vinyls Corp. ..................
International N.V.* ................. 800 20,789
Fortis Amev N.V ........................ 3,160 211,691
Heineken N.V ........................... 560 99,353
Internationale Nederlanden
Groep N.V ........................... 2,002 133,741
----------
465,574
----------
NEW ZEALAND--0.9%
Air New Zealand Ltd. Cl.B .............. 1,000 3,400
Fletcher Challenge Ltd. ................ 15,000 21,378
Lion Nathan Ltd. ....................... 22,000 52,497
Telecom Corp. of
New Zealand Ltd. .................... 17,100 73,784
----------
151,059
----------
NORWAY--0.9%
Bergesen D.Y. AS Cl.A .................. 3,100 61,666
Christiania Bank OG Kreditkasse ........ 39,000 91,126
----------
152,792
----------
PHILIPPINES--0.4%
Manila Electric Co. .................... 6,550 53,439
Philippine Commercial
International Bank .................. 1,000 9,226
----------
62,665
----------
SINGAPORE--1.8%
Overseas Chinese Bank .................. 7,000 87,593
Overseas Union Bank Ltd. ............... 16,000 110,286
Singapore Airlines Ltd. ................ 2,000 18,664
Singapore Press Holdings Ltd. ..........
(Foreign) ........................... 5,000 88,370
----------
304,913
----------
SPAIN--2.0%
Banco Intercontinental Espana .......... 1,302 126,658
Repsol S.A ............................. 2,900 95,033
Tabacalera S.A. Series A ............... 2,240 84,946
Uralita S.A ............................ 1,950 $ 17,684
----------
324,321
----------
SWEDEN--2.1%
Astra AB ............................... 5,030 200,755
Marieberg Tidnings AB .................. 3,200 74,220
Stora Kopparbergs Series B ............. 6,115 73,217
----------
348,192
----------
SWITZERLAND--3.1%
Baloise Holdings Ltd. .................. 20 41,613
Ciba Geigy AG .......................... 170 149,588
Forbo Holding .......................... 215 91,890
Nestle S.A ............................. 143 158,186
Winterthur Schweizerische
Versicherungs-Gesellschaft .......... 100 70,741
----------
512,018
----------
TAIWAN--0.3%
Advanced Semiconductor
Engineering (GDR) (b) ............... 2,400 30,840
China Steel Corp. (GDR) ................ 1,000 17,000
----------
47,840
----------
THAILAND--0.5%
Bangkok Bank Public Co. Ltd. ........... 3,000 36,443
Thai Farmers Bank Co. .................. 4,000 40,333
----------
76,776
----------
UNITED KINGDOM--12.9%
Anglian Water Plc ...................... 9,000 84,842
Bat Industries Plc ..................... 19,800 174,353
British Airways Plc .................... 16,695 120,824
British Land Co. Plc ................... 10,800 63,904
British Telecommunications Plc ......... 20,600 112,934
BTR Plc ................................ 22,000 112,067
Enterprise Oil Plc ..................... 5,600 34,440
Forte Plc .............................. 12,000 61,593
General Electric Plc ................... 21,400 117,652
Grand Metropolitan Plc ................. 19,600 141,087
Hazlewood Foods Plc .................... 19,300 29,674
Hepworth Plc ........................... 18,600 92,148
House of Fraser Plc .................... 7,000 19,242
Lex Service Plc ........................ 2,600 12,336
Marley Plc ............................. 28,500 49,130
Mowlem (John) & Co. Plc ................ 41,000 37,568
Peninsular & Oriental Steam
Navigation Co. ...................... 11,150 82,426
Royal Bank of Scotland Group ........... 9,900 90,098
Rugby Group Plc ........................ 51,100 87,296
Sainsbury (J.) Plc ..................... 9,950 60,652
Smith (WH) Group Plc ................... 9,000 59,264
Smithkline Beecham Cl.A ................ 4,536 50,017
36
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
Tate & Lyle Plc ........................ 19,200 $ 140,742
Vodafone Group Plc ..................... 42,200 151,393
Wimpey (George) Plc .................... 69,300 154,981
----------
2,140,663
----------
Total Common Stocks
(cost $14,603,364) .................. 15,334,074
----------
SHORT-TERM INVESTMENTS--8.6%
TIME DEPOSIT--8.6%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost $1,426,000) ......... $1,426 1,426,000
----------
TOTAL INVESTMENTS--101.3%
(cost $16,029,364)............... $16,760,074
Other assets less liabilities--(1.3%) (218,439)
-----------
NET ASSETS--100.0%................... $16,541,635
===========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
(a) Securities segregated to collateralize forward exchange currency
contracts with an aggregate market value of $1,320,720.
(b) Securities exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration normally applied to certain qualified buyers. At
December 31, 1995, the aggregate market value of these securities
amounted to $128,142 or 0.8% of net assets. See Glossary of Terms on
page 52. See Notes to Financial Statements.
37
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
-------- -----------
U.S. GOVERNMENT AND
AGENCY OBLIGATIONS--115.5%
Federal Farm Credit Bank
5.43%, 1/12/96................... $6,900 $ 6,888,552
Federal Home Loan Bank
5.33%, 5/13/96................... 3,000 2,940,926
5.50%, 1/22/96................... 4,500 4,485,562
5.50%, 1/26/96................... 700 697,326
Federal Home Loan Mortgage Corp.
5.67%, 1/22/96................... 8,000 7,973,540
Federal National Mortgage Assn.
5.58%, 1/25/96................... 1,600 1,594,048
5.59%, 1/30/96................... 1,300 1,294,146
5.62%, 1/05/96................... 1,600 1,599,001
U.S. Treasury Bills
5.35%, 1/25/96................... 5,000 4,982,167
-----------
TOTAL INVESTMENTS--115.5%
(amortized cost $32,455,268) 32,455,268
Other assets less liabilities--(15.5%) (4,362,960)
-----------
NET ASSETS--100.0%................... $28,092,308
===========
- ---------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements.
38
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GLOBAL DOLLAR GOVERNMENT PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
SOVEREIGN DEBT
OBLIGATIONS--52.5%
COLLATERALIZED
BRADY BONDS--25.6%
ARGENTINA--3.2%
Republic of Argentina
Euro Par Bonds
5.00%, 3/31/23 (a)
(cost $102,519) ..................... $ 210 $ 120,094
----------
BULGARIA--2.8%
National Republic of Bulgaria
Series A Disc
6.75%, 7/28/24 (FRN)(b)
(cost $93,845) ...................... 200 106,750
----------
ECUADOR--3.6%
Republic Of Ecuador Disc
6.8125%, 2/28/25 (FRN)(b) ........... 130 66,138
Republic of Ecuador Par Bonds
3.00%, 2/28/25 (a) .................. 190 69,112
----------
Total Ecuadorian Securities
(cost $121,575) ..................... 135,250
----------
MEXICO--4.3%
United Mexican States
6.25%, 12/31/19
(cost $146,372) ..................... 250 163,437
----------
NIGERIA--3.3%
Central Bank of Nigeria
6.25%, 11/15/20 (a)
(cost $104,960) ..................... 250 123,125
----------
PHILIPPINES--3.2%
Central Bank of Philippines
6.25%, 12/01/17 (a)
(cost $114,481) ..................... 165 122,925
----------
POLAND--1.4%
Republic of Poland Disc
6.875%, 10/27/24 (FRN)(b)
(cost $51,232) ...................... 70 53,025
----------
VENEZUELA--3.8%
Republic of Venezuela Series A
6.75%, 3/31/20 (FRN)(b)
(cost $125,017) ..................... 250 143,438
----------
Total Collateralized Brady Bonds
(cost $860,001) ..................... $968,044
----------
OTHER SOVEREIGN DEBT--26.9%
ARGENTINA--9.2%
Hidroelectrica Alicura
8.375%, 3/15/99 ..................... $ 150 139,500
Republic of Argentina (FRN)(b)
6.8125%, 3/31/05 .................... 288 205,920
----------
Total Argentinian Securities
(cost $320,333) ..................... 345,420
----------
BRAZIL--8.8%
Republic of Brazil C-Bonds
8.00%, 4/15/14 (c) .................. 520 298,670
Republic of Brazil Series A IDU
6.6875%, 1/01/01 (FRN)(b) ........... 37 31,909
----------
Total Brazilian Securities
(cost $282,951) ..................... 330,579
----------
MEXICO--0.3%
Desc Sociedad de Fomento
11.00%, 12/15/97
(cost $10,500) ...................... 10 9,963
----------
POLAND--7.2%
Republic of Poland PDI
3.75%, 10/27/14 (FRN)(b)
(cost $267,274) ..................... 420 273,525
----------
TRINIDAD & TOBAGO--1.4%
Republic of Trinidad & Tobago
11.75%, 10/03/04
(cost $49,710) ...................... 50 54,500
----------
Total Other Sovereign Debt
(cost $930,768) ..................... 1,013,987
----------
Total Sovereign Debt Obligations
(cost $1,790,769) ................... 1,982,031
----------
CORPORATE DEBT OBLIGATIONS--17.4%
BROADCASTING & CABLE--1.2%
Tele-Communications, Inc.
9.875%, 6/15/22 ...................... 3 3,689
----------
39
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GLOBAL DOLLAR GOVERNMENT PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
Viacom, Inc.
8.00%, 7/07/06 ...................... $ 40 $ 40,700
----------
Total Broadcasting & Cable
(cost $36,511) ...................... 44,389
----------
FINANCIAL SERVICES--0.9%
Dine S.A. de CV
8.125%, 10/15/98
(cost $37,040) ...................... 40 35,750
----------
INDUSTRIAL--6.5%
Hylsa S.A. de CV
11.00%, 2/23/98
(cost $246,406) ..................... 250 245,313
----------
YANKEES--8.8%
Centragas
10.65%, 12/01/10 (d) ................ 48 51,038
Centragas Columbia
10.65%, 12/01/10 .................... 48 51,039
Grupo Mexicano de Desarrollo
8.25%, 2/17/01 ...................... 40 16,600
Philippine Long Distance
9.875%, 8/01/05 ..................... 100 106,375
Polysindo Eka Perkasa
13.00%, 6/15/01 ..................... 75 77,625
Telefonica de Argentina
8.375%, 10/01/00 .................... 20 19,025
Transportacion Maritima
Mexicana S.A
9.25%, 5/15/03 ...................... $ 12 $ 10,590
----------
Total Yankees
(cost $330,010) ..................... 332,292
----------
Total Corporate Debt Obligations
(cost $649,967) ..................... 657,744
----------
U.S. GOVERNMENT
OBLIGATIONS--17.7%
U.S. Treasury Notes
6.50%, 4/30/99 ...................... 55 57,011
7.25%, 8/15/04 ...................... 550 611,616
----------
Total U.S. Government Obligations
(cost $603,125) ..................... 668,627
----------
P
SHORT-TERM INVESTMENTS--10.7%
TIME DEPOSIT--10.7%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost $406,000) ........... 406 406,000
----------
TOTAL INVESTMENTS--98.3%
(cost $3,449,861) ................... 3,714,402
Other assets less liabilities--1.7% .... 63,693
----------
NET ASSETS--100.0% ..................... $3,778,095
==========
- ------------------------------------------------------------------------------------------------------------------------
(a) Coupon will increase periodically based upon a predetermined schedule.
Stated interest rate in effect at December 31, 1995.
(b) Coupon will fluctuate based upon an interest rate index. Stated interest
rate in effect at December 31, 1995.
(c) Coupon consists of 4.00% cash payment and 4.00% paid-in-kind.
(d) Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally applied to certain qualified buyers. At December 31,
1995, the aggregate market value of these securities amounted to $51,038 or
1.4% of net assets.
See Glossary of Terms on page 52.
See Notes to Financial Statements.
40
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NORTH AMERICAN GOVERNMENT INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- ----------
ARGENTINA--23.2%
GOVERNMENT OBLIGATIONS--23.2%
Republic of Argentina
Pensioner-Bocon Series I
3.46%, 4/01/01 (FRN)(a) . ARS 331 $ 216,472
3.46%, 4/01/07 (FRN)(a) . 2,988 1,442,858
Republic of Argentina
Pensioner-Bocon Series II
3.46%, 9/01/02 (FRN)(a) . 58 31,322
-------
Total Argentinian Securities
(cost $1,485,032) ....... 1,690,652
----------
CANADA--16.6%
GOVERNMENT/AGENCY--16.6%
Government of Canada
6.50%, 6/01/04 (b) ...... CAD 1,250 884,584
Manitoba Province Canada
7.75%, 12/22/25 ......... 450 323,123
-------
Total Canadian Securities
(cost $1,172,819) ....... 1,207,707
---------
MEXICO--14.2%
GOVERNMENT/AGENCY--14.2%
Mexican Treasury Bills
Zero Coupon, 1/04/96 ....... MXP 1,976 254,144
Zero Coupon, 1/11/96 ....... 2,615 333,376
Zero Coupon, 1/18/96 ....... 700 88,435
Zero Coupon, 1/25/96 ....... 339 42,441
Zero Coupon, 2/15/96 ....... 634 77,369
Zero Coupon, 3/20/96 ....... 2,000 234,408
--------
Total Mexican Securities
(cost $1,181,718) 1,030,173
---------
UNITED STATES--40.8%
U.S. TREASURY SECURITIES--28.8%
U.S. Treasury Notes
6.50%, 4/30/99 ............ US$ 85 $ 88,108
7.125%, 9/30/99 ........... 320 339,299
7.125%, 9/30/99 ........... 1,500 1,668,045
----------
2,095,452
----------
FEDERAL AGENCY-MORTGAGES--2.8%
Government National Mortgage Assn.
9.00%, 9/15/24 ............ 194,231 205,762
----------
FEDERAL AGENCY--9.2%
Federal Home Loan Bank
7.26%, 9/06/01 ............ 200 215,406
Federal Home Loan Mortgage Corp.
6.13%, 8/19/99 ............ 150 153,046
Federal National Mortgage Assn.
5.05%, 11/10/98 ........... 305 302,237
-----------
670,689
----------
Total United States Securities
(cost $2,743,055).......... 2,971,903
----------
TOTAL INVESTMENTS--94.8%
(cost $6,582,624) ........... 6,900,435
Other assets less liabilities--5.2% 377,492
----------
NET ASSETS--100.0%............. $ 7,277,927
===========
- ------------------------------------------------------------------------------------------------------------------------
(a) Coupon will fluctuate based upon an interest rate index. Stated interest
rate in effect at December 31, 1995.
(b) Security segregated to collateralize forward exchange currency contracts
with an aggregate market value of $884,584.
See Notes to Financial Statements.
41
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
UTILITY INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
COMMON AND
PREFERRED STOCKS--91.7%
UNITED STATES INVESTMENTS--81.8%
CONSUMER SERVICES--8.7%
BROADCASTING &
CABLE--8.7%
AirTouch Communications, Inc.* ......... 10,896 $ 307,812
Tele-Communications, Inc. Cl.A* ........ 7,700 153,519
U.S. West Media Group .................. 4,200 79,800
----------
541,131
----------
ENERGY--3.1%
OIL & GAS SERVICES--1.9%
Western Atlas, Inc.* ................... 2,300 116,150
----------
PIPELINES--1.2%
Enron Corp. ............................ 2,000 76,250
----------
192,400
----------
TECHNOLOGY--12.4%
COMMUNICATIONS
EQUIPMENT--12.4%
DSC Communications Corp. ............... 5,400 199,800
General Instrument Corp.* .............. 3,600 84,150
Glenayre Technologies, Inc.* ........... 1,300 80,925
Motorola, Inc. ......................... 3,000 171,000
Northern Telecom, Ltd. ................. 3,600 154,800
Scientific-Atlanta, Inc. ............... 3,100 46,500
Tellabs, Inc.* ......................... 1,100 40,838
----------
778,013
----------
TRANSPORTATION--5.1%
RAILROADS--5.1%
Southern Pacific Rail Corp.* ........... 5,900 141,600
Union Pacific Corp. .................... 2,700 178,200
----------
319,800
----------
UTILITIES--52.5%
ELECTRIC & GAS--35.3%
Allegheny Power Systems ................ 7,800 223,275
Baltimore Gas & Electric Co. ........... 4,800 136,800
CMS Energy Corp. ....................... 2,300 68,713
DPL, Inc. .............................. 1,700 42,075
FPL Group, Inc. ........................ 4,100 190,137
Houston Industries, Inc. ............... 6,600 160,050
New York State Electric &
Gas Corp. ........................... 9,800 253,575
Oklahoma Gas & Electric Co. ............ 5,000 215,000
Peco Energy Capital L.P.
9.00% Series A pfd .................. 430 11,449
Pinnacle West Capital Corp. ............ 7,400 $ 212,750
Portland General Corp. ................. 4,980 145,042
Public Service Co. of New Mexico ....... 14,800 260,850
Texas Utilities Co. .................... 7,000 287,875
----------
2,207,591
----------
TELEPHONE--17.2%
AT & T Corp. ........................... 5,860 379,435
MCI Communications Corp. ............... 10,800 282,825
Nynex Corp. ............................ 1,900 102,600
Telephone and Data Systems, Inc. ....... 900 35,550
U.S. Cellular Corp.* ................... 3,600 121,500
U.S. West Communications, Inc. ......... 4,200 150,150
----------
1,072,060
----------
3,279,651
----------
Total United States Investments
(cost $4,777,183) ................... 5,110,995
----------
FOREIGN INVESTMENTS--9.9%
ARGENTINA--1.2%
Metrogas (ADR) ......................... 5,100 49,725
Telecom Argentina
Stet France (ADR) ................... 500 23,813
----------
73,538
----------
CANADA--0.2%
Canadian National Railway Co.* ......... 800 12,000
----------
CHILE--2.4%
Enersis S.A. (ADR) ..................... 2,100 59,850
Compania de Telefonos Chile (ADR) ...... 1,100 91,162
----------
151,012
----------
FINLAND--3.1%
Nokia Corp. (ADR) ...................... 5,100 198,262
----------
HONG KONG--1.7%
Consolidated Electric Power
Asia (ADR) .......................... 58,800 106,840
----------
INDONESIA--0.7%
Indonesian Satellite Corp. (ADR) ....... 1,170 42,705
----------
KOREA--0.6%
Korea Electric Power Corp. (ADR) ....... 1,400 37,450
----------
Total Foreign Investments
(cost $652,426) ..................... 621,807
----------
42
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
UTILITY INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
--------- -----------
Total Common and Preferred Stocks
(cost $5,429,609) ................... $5,732,802
----------
SHORT-TERM INVESTMENTS--8.0%
U.S. GOVERNMENT
OBLIGATIONS--8.0%
Federal Home Loan Bank
5.50%, 1/05/96
(amortized cost $499,694) ........... $ 500 499,694
----------
TOTAL INVESTMENTS--99.7%
(cost $5,929,303) ................... 6,232,496
Other assets less liabilities--0.3% .... 18,045
----------
NET ASSETS--100.0% ..................... $6,250,541
==========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
See Notes to Financial Statements.
43
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
COMMON STOCKS--95.1%
BASIC INDUSTRIES--5.7%
CHEMICALS--2.7%
Grace (W.R.) & Co. ..................... 7,200 $ 425,700
Great Lakes Chemical Corp. ............. 6,900 496,800
Monsanto Co. ........................... 2,500 306,250
----------
1,228,750
----------
METALS & MINING--2.1%
Freeport McMoRan, Inc. ................. 25,650 949,050
----------
PAPER & FOREST
PRODUCTS--0.9%
Louisiana-Pacific Corp.* ............... 16,000 388,000
----------
2,565,800
----------
CAPITAL GOODS--1.1%
MACHINERY--1.1%
Mannesmann AG (ADR) .................... 1,600 510,537
----------
CONSUMER SERVICES--15.4%
BROADCASTING &
CABLE--8.0%
AirTouch Communications, Inc.* ......... 30,900 872,925
Argyle Television, Inc. ................ 66,600 1,148,850
Liberty Media Group Cl.A* .............. 11,325 303,652
Tele-Communications, Inc. Cl.A* ........ 58,300 1,162,356
Turner Broadcasting
Systems, Inc., Cl.B ................. 5,000 130,000
----------
3,617,783
----------
ENTERTAINMENT &
LEISURE--2.1%
ITT Corp. .............................. 17,900 948,700
----------
PRINTING & PUBLISHING--1.1%
Donnelley (R.R.) & Sons Co. ............ 12,800 504,000
----------
RESTAURANTS &
LODGING--0.3%
Triarc Cos., Inc.* ..................... 12,000 132,000
----------
RETAILING--3.9%
Home Depot, Inc. ....................... 13,000 622,375
Lowes Cos., Inc. ....................... 25,100 840,850
Talbots, Inc. .......................... 11,000 316,250
----------
1,779,475
----------
6,981,958
----------
CONSUMER STAPLES--5.2%
FOOD--0.7%
Coca-Cola Femsa S.A. (ADR) ............. 18,000 $ 333,000
----------
TOBACCO--4.5%
Loews Corp. ............................ 10,800 846,450
Philip Morris Cos., Inc. ............... 13,000 1,176,500
----------
2,022,950
----------
2,355,950
----------
ENERGY--2.2%
OIL & GAS SERVICES--2.2%
Gulf Canada Resources Ltd.* ............ 244,000 1,006,500
----------
FINANCE--22.5%
BANKING & CREDIT--1.2%
Union Acceptance Corp. ................. 37,700 541,938
----------
INSURANCE--12.0%
American International Group, Inc. ..... 7,550 698,375
Capmac Holdings Inc.* .................. 16,000 402,000
Guarantee Life Cos., Inc.* ............. 7,600 120,175
ITT Hartford Group, Inc. ............... 16,000 774,000
Meadowbrook Insurance Group, Inc.* ..... 6,100 204,350
Penncorp Financial Group, Inc. ......... 20,000 587,500
PMI Group, Inc. ........................ 11,000 497,750
Progressive Corp. (Ohio) ............... 11,000 537,625
Travelers, Inc. ........................ 25,500 1,603,312
----------
5,425,087
----------
MORTGAGE BANKING--1.1%
Federal National Mortgage Assn ......... 4,000 496,500
----------
REAL ESTATE--6.9%
Amli Residential Properties Trust ...... 5,900 118,000
CBL & Associates Properties, Inc. ...... 6,500 141,375
Essex Property Trust ................... 20,500 394,625
First Industrial Realty Trust, Inc. .... 8,500 191,250
Gables Residential Trust ............... 5,000 114,375
Highwoods Properties, Inc. ............. 5,900 166,675
JP Realty, Inc. ........................ 28,000 612,500
Macerich Co. ........................... 15,500 310,000
Patriot American Hospitality, Inc. ..... 17,000 437,750
Saul Centers, Inc. ..................... 9,000 122,625
Shurgard Storage Center, Inc. .......... 2,000 54,000
Storage USA, Inc. ...................... 6,000 195,750
Summit Properties, Inc. ................ 13,600 270,300
----------
3,129,225
----------
44
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------- -----------
OTHER--1.3%
Americredit Corp.* ..................... 9,000 $ 122,625
Mercury Finance Co. .................... 28,500 377,625
MS Financial, Inc. ..................... 12,200 81,587
----------
581,837
----------
10,174,587
----------
HEALTH CARE--4.6%
BIOTECHNOLOGY--0.3%
Gensia, Inc.* (a) ...................... 8,000 116,000
----------
DRUGS--2.9%
AB Astra Series A ...................... 4,500 179,601
Amgen, Inc.* ........................... 4,000 237,250
Healthsource, Inc.* .................... 5,000 180,000
Merck & Co., Inc. ...................... 5,700 374,775
Pfizer, Inc. ........................... 5,500 346,500
----------
1,318,126
----------
MEDICAL PRODUCTS--0.5%
Abbott Laboratories, Inc. .............. 6,000 250,500
----------
MEDICAL SERVICES--0.9%
Quest Medical, Inc.* ................... 38,000 394,250
----------
2,078,876
----------
TECHNOLOGY--29.7%
COMMUNICATIONS
EQUIPMENT--14.4%
Cisco Systems, Inc.* ................... 25,000 1,867,187
DSC Communications Corp.* .............. 8,800 325,600
EMC Corp.* ............................. 48,000 738,000
Millicom International
Cellular S.A.* ...................... 8,500 260,313
Motorola, Inc. ......................... 6,600 376,200
Newbridge Networks Corp.* .............. 18,000 744,750
Nokia Corp. (ADR) ...................... 28,000 1,088,500
Westinghouse Electric Corp. ............ 68,000 1,122,000
----------
6,522,550
----------
COMPUTER HARDWARE--3.6%
3Com Corp.* (a) ........................ 15,700 732,994
Bay Networks, Inc.* .................... 14,250 585,140
Cabletron Systems, Inc.* ............... 4,000 324,000
----------
1,642,134
----------
COMPUTER SOFTWARE &
SERVICES--5.1%
General Motors Corp. Cl.E .............. 12,000 $ 624,000
Microsoft Corp.* ....................... 3,000 263,438
Oracle Corp.* .......................... 23,000 974,625
Sterling Software Inc.* ................ 7,000 436,625
----------
2,298,688
----------
ELECTRONICS--2.8%
ITT Industries, Inc. ................... 16,000 384,000
Tandy Corp. ............................ 1,700 70,550
Texas Instruments, Inc. ................ 15,500 802,125
----------
1,256,675
----------
SEMI-CONDUCTORS &
RELATED--3.8%
Applied Materials, Inc.* ............... 2,000 78,625
Intel Corp. ............................ 5,200 295,425
Micron Technology, Inc. ................ 6,000 237,750
National Semiconductor Corp.* .......... 48,400 1,076,900
----------
1,688,700
----------
13,408,747
----------
TRANSPORTATION--3.6%
AIR FREIGHT--0.7%
Pittston Services Group ................ 10,000 313,750
----------
RAILROADS--2.9%
Canadian National Railway Co.* ......... 10,000 150,000
Conrail, Inc. .......................... 2,000 140,000
Southern Pacific Rail Corp.* ........... 6,000 144,000
Union Pacific Corp. .................... 13,200 871,200
----------
1,305,200
----------
1,618,950
----------
UTILITIES--5.1%
TELEPHONE--5.1%
MCI Communications Corp. ............... 7,000 183,313
Rogers Cantel Mobile
Communications, Inc. Cl.B* .......... 5,300 139,456
Telephone & Data Systems, Inc. ......... 42,900 1,694,550
U.S. Cellular Corp.* ................... 5,000 168,750
Vodafone Group Plc (ADR) ............... 3,000 105,750
----------
2,291,819
----------
Total Common Stocks
(cost $39,339,278) .................. 42,993,724
----------
45
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
--------- -----------
CONVERTIBLE BONDS--1.9%
3Com Corp.
10.25%, 11/01/01 (a) ................ $ 400 $ 615,000
Altera Corp. ...........................
5.75%, 6/15/02 (a) .................. 225 262,125
----------
Total Convertible Bonds
(cost $830,275) ..................... 877,125
----------
SHORT-TERM INVESTMENTS--4.2%
U.S. GOVERNMENT
OBLIGATIONS--4.2%
Federal Home Loan Mortgage Corp.
5.75%, 1/02/96
(amortized cost $1,899,697) ......... 1,900 1,899,697
----------
TOTAL INVESTMENTS--101.2%
(cost $42,069,250)............... $45,770,546
Other assets less liabilities--(1.2%) (550,835)
----------
NET ASSETS--100.0%................... $45,219,711
===========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
(a) Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally applied to certain qualified buyers. At December 31,
1995, the aggregate market value of these securities amounted to $1,726,119
or 3.8% of net assets.
See Notes to Financial Statements.
46
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
WORLDWIDE PRIVATIZATION PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
--------- -----------
COMMON AND
PREFERRED STOCKS--67.0%
ARGENTINA--2.8%
Central Costanera ...................... 15,000 $ 46,191
Naviera Perez Comp Cia ................. 11,000 58,288
Telecom Argentina Stet
France (ADR) ........................ 1,300 61,913
----------
166,392
----------
AUSTRALIA--2.9%
CSL Ltd. ............................... 25,000 74,327
TAB Corp. Holdings Ltd. ................ 35,000 98,856
----------
173,183
----------
AUSTRIA--3.5%
Ams Austria Mikros ..................... 360 58,402
Flughafen Wien AG ...................... 1,000 67,470
VA Technologies AG ..................... 650 82,552
----------
208,424
----------
BRAZIL--2.9%
Centrais Eletricas Brasileiras ......... 4,000 54,119
Telecomunicacoes Brasileras
S.A. (ADR)* ......................... 1,900 91,489
Usinas Siderurgicas
de Minas (ADR) (a) .................. 3,000 24,385
----------
169,993
----------
CANADA--1.0%
Petro Canada ........................... 5,000 57,671
----------
DENMARK--0.9%
Tele Danmark AS ........................ 1,000 54,570
----------
FINLAND--1.9%
Unitas Bank Ltd.* ...................... 15,000 37,936
Valmet Co. ............................. 3,000 75,183
----------
113,119
----------
FRANCE--7.0%
Renault S.A ............................ 4,000 115,173
Roussel Uclaf .......................... 350 59,322
Seita .................................. 2,000 72,493
Sgs Thomson Micro Ltd.* ................ 1,000 38,289
Soc Elf Aquitaine ...................... 700 51,574
Usinor Sacilor* ........................ 6,000 79,334
----------
416,185
----------
GERMANY--4.1%
Lufthansa .............................. 900 123,911
Viag AG ................................ 300 120,251
----------
244,162
----------
GHANA--0.8%
Ashanti Goldfield Co. Ltd.
(ADR)* (a) .......................... 2,500 $ 49,375
----------
GREECE--0.6%
Hellenic Sugar Industries .............. 3,000 38,719
----------
HONG KONG--2.5%
Citic Pacific Ltd. ..................... 15,000 51,309
Hopewell Holdings Ltd. (ADR) ........... 60,000 34,530
Yizheng Chemical Fibre.................. 274,000 61,657
----------
147,496
----------
HUNGARY--0.7%
Otp Bank ............................... 6,000 39,900
----------
INDONESIA--2.1%
Indosat ................................ 35,000 127,050
----------
IRELAND--1.0%
Irish Life Plc ......................... 15,000 56,916
----------
ITALY--3.1%
Ente Nazionale Idrocarburi S.p.A.* ..... 15,000 52,420
IMI LNV ................................ 10,000 62,968
INA .................................... 50,000 66,273
----------
181,661
----------
JAPAN--3.8%
DDI Corp. .............................. 5 38,741
East Japan Railway Co. ................. 30 145,859
Nippon Telegraph and
Telephone Corp. ..................... 5 40,436
----------
225,036
----------
KOREA--2.3%
Korea Mobile Telecommunications
Corp. (ADR) ......................... 1,200 52,200
Korea Mobile Telecommunications
Corp. (GDR) ......................... 1,900 82,650
----------
134,850
----------
MALAYSIA--1.4%
Ekran Bhd .............................. 15,000 36,619
Telekom Malaysia ....................... 6,000 46,777
----------
83,396
----------
MEXICO--0.8%
Telefonos de Mexico,
S.A. Series L (ADR) ................. 1,500 47,813
----------
47
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
WORLDWIDE PRIVATIZATION PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
NETHERLANDS--2.5%
KLM .................................... 2,048 $ 71,980
Kon Ptt Nederland ...................... 2,031 73,788
----------
145,768
----------
NEW ZEALAND--1.3%
Telecom Corporation of
New Zealand Ltd. .................... 18,000 77,667
----------
NORWAY--0.8%
Christiania Bank OG Kreditkasse ........ 20,000 46,731
----------
PHILIPPINES--2.0%
First Philippines Holdings ............. 20,000 38,887
Manila Electric Co. .................... 10,000 81,586
----------
120,473
----------
SINGAPORE--1.0%
Development Bank of Singapore .......... 5,000 62,213
----------
SOUTH AFRICA--0.6%
Iscor .................................. 41,100 36,979
----------
SPAIN--2.2%
Emp Nac Electricid ..................... 1,000 56,636
Repsol S.A ............................. 2,200 72,094
----------
128,730
----------
THAILAND--1.4%
Industrial Finance of Thailand ......... 25,000 84,855
----------
TURKEY--0.4%
Turk Hava Yollari....................... 181,818 24,183
----------
SHARES OR
PRINCIPAL
AMOUNT
(000)
---------
UNITED KINGDOM--6.1%
London Electricity ..................... 4,000 $ 35,627
National Grid Grp* ..................... 3,411 10,542
National Power ......................... 8,000 55,847
Northern Ireland Electricity Plc ....... 10,000 66,781
Powergen ............................... 6,073 50,176
RJB Mining Plc ......................... 6,000 50,877
Southern Water ......................... 4,000 42,709
Wessex Water Plc ....................... 8,333 45,295
Wessex Water Plc, pfd .................. 10,000 7,920
----------
365,774
----------
UNITED STATES--2.6%
Pharmacia & Upjohn, Inc. ............... 4,000 155,000
----------
Total Common and Preferred Stocks
(cost $3,768,412) ................... 3,984,284
----------
SHORT-TERM INVESTMENTS--33.0%
TIME DEPOSIT--33.0%
State Street Bank and Trust Co.
5.50%, 1/02/96
(amortized cost $1,965,000) ......... $1,965 1,965,000
----------
TOTAL INVESTMENTS--100.0%
(cost $5,733,412) ................... 5,949,284
Other assets less liabilities--0.0% .... (2,510)
----------
NET ASSETS--100.0% ..................... $5,946,774
==========
- ----------
* Non-income producing security.
(a) Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally applied to certain qualified buyers. At December 31,
1995, the aggregate market value of these securities amounted to $73,760 or
1.2% of net assets.
See Notes to Financial Statements.
48
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
CONSERVATIVE INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
--------- -----------
COMMON STOCKS--11.5%
BASIC INDUSTRIES--0.8%
CHEMICALS--0.5%
Air Products & Chemicals, Inc. ......... 200 $ 10,550
Hercules, Inc. ......................... 500 28,187
----------
38,737
----------
METALS & MINING--0.3%
Aluminum Co. of America ................ 400 21,150
----------
59,887
----------
CAPITAL GOODS--1.0%
ELECTRICAL EQUIPMENT--0.8%
General Electric Co. ................... 700 50,400
Molex, Inc. ............................ 250 8,000
----------
58,400
----------
MACHINERY--0.2%
Deere & Co. ............................ 500 17,625
----------
76,025
----------
CONSUMER SERVICES--1.4%
ENTERTAINMENT &
LEISURE--0.4%
Eastman Kodak Co. ...................... 500 33,500
----------
RESTAURANTS &
LODGING--0.4%
McDonald's Corp. ....................... 700 31,587
----------
RETAILING--0.6%
Rite Aid Corp. ......................... 1,200 41,100
----------
106,187
----------
CONSUMER STAPLES--1.9%
COSMETICS--0.7%
Gillette Co. ........................... 1,000 52,125
----------
FOOD--0.5%
Coca-Cola Co. .......................... 400 29,700
IBP, Inc. .............................. 100 5,050
----------
34,750
----------
TOBACCO--0.7%
Philip Morris Cos., Inc. ............... 600 54,300
----------
141,175
----------
ENERGY--0.7%
DOMESTIC INTEGRATED--0.6%
Amoco Corp. ............................ 200 14,375
Mobil Corp. ............................ 300 $ 33,600
----------
47,975
----------
PIPELINES--0.1%
Enron Corp. ............................ 100 3,813
----------
51,788
----------
FINANCE--2.4%
BANKING & CREDIT--1.7%
American Express Co. ................... 1,000 41,375
Bank of New York Co., Inc. ............. 1,000 48,750
Citicorp ............................... 400 26,900
UST, Inc. .............................. 200 6,675
----------
123,700
----------
INSURANCE--0.7%
AFLAC, Inc. ............................ 100 4,337
General Reinsurance Corp. .............. 300 46,500
----------
50,837
----------
174,537
----------
HEALTH CARE--1.1%
DRUGS--0.7%
Pfizer, Inc. ........................... 800 50,400
----------
MEDICAL PRODUCTS--0.4%
Medtronic, Inc. ........................ 600 33,525
----------
83,925
----------
MULTI INDUSTRY
COMPANIES--0.1%
Tyco International Ltd. ................ 200 7,125
----------
TECHNOLOGY--0.2%
COMPUTER SOFTWARE &
SERVICES--0.2%
Reynolds & Reynolds Co. ................ 300 11,663
----------
UTILITIES--1.9%
TELEPHONE--1.9%
Cincinnati Bell, Inc. .................. 1,000 34,750
Nynex Corp. ............................ 1,300 70,200
SBC Communications, Inc. ............... 600 34,500
----------
139,450
----------
Total Common Stocks
(cost $768,041) ..................... 851,762
----------
49
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
CONSERVATIVE INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) U.S.$ VALUE
---------- -----------
U.S. GOVERNMENT
OBLIGATIONS--45.9%
U.S. Treasury Bonds
6.875%, 8/15/25.................. $1,855 $ 2,092,088
7.625%, 2/15/25.................. 357 436,543
U.S. Treasury Notes
5.75%, 10/31/00.................. 55 55,790
5.875%, 11/15/05................. 600 613,500
6.50%, 8/15/05................... 105 111,858
7.75%, 12/31/99.................. 90 97,664
-----------
Total U.S. Government Obligations
(cost $3,234,315)................ 3,407,443
-----------
SHORT-TERM INVESTMENTS--40.4%
U.S. GOVERNMENT
OBLIGATIONS--40.4%
Federal Farm Credit Bank
5.50%, 1/05/96................... 700 699,572
Federal Home Loan Bank
5.50%, 1/05/96...................$ 700 $ 699,572
Federal Home Loan Mortgage Corp.
5.75%, 1/02/96................... 1,600 1,599,745
-----------
Total Short-Term Investments
(amortized cost $2,998,889)...... 2,998,889
----------
TOTAL INVESTMENTS--97.8%
(cost $7,001,245)................ 7,258,094
Other assets less liabilities--2.2% 161,626
----------
NET ASSETS--100.0%................... $7,419,720
==========
- -----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements.
50
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
SHARES U.S.$ VALUE
------ -----------
COMMON STOCKS--41.3%
BASIC INDUSTRIES--2.6%
CHEMICALS--1.4%
Air Products & Chemicals, Inc. 500 $ 26,375
Hercules, Inc. ............... 800 45,100
--------
71,475
--------
METALS & MINING--0.9%
Aluminum Co. of America ...... 800 42,300
--------
PACKAGING--0.3%
Sealed Air Corp.* ............ 500 14,063
--------
127,838
--------
CAPITAL GOODS--1.1%
ELECTRICAL EQUIPMENT--0.7%
General Electric Co. ......... 300 21,600
Molex, Inc. .................. 375 12,000
--------
33,600
--------
MACHINERY--0.4%
Deere & Co. .................. 600 21,150
--------
54,750
--------
CONSUMER SERVICES--6.2%
AIRLINES--0.7%
Delta Air Lines, Inc. ........ 500 36,937
--------
ENTERTAINMENT &
LEISURE--1.4%
CUC International, Inc.* ..... 1,000 34,125
Eastman Kodak Co. ............ 500 33,500
--------
67,625
--------
RESTAURANTS &
LODGING--2.1%
Marriot International, Inc. .. 1,500 57,375
McDonald's Corp. ............. 1,000 45,125
--------
102,500
--------
RETAILING--2.0%
Consolidated Stores Corp.* ... 500 10,875
Dollar General Corp. ......... 500 10,375
Office Depot, Inc.* .......... 500 9,875
Rite Aid Corp. ............... 2,000 68,500
--------
99,625
--------
306,687
--------
CONSUMER STAPLES--7.1%
COSMETICS--2.6%
Gillette Co. ................. 2,500 130,312
--------
FOOD--1.8%
Coca-Cola Co. ................ 800 59,400
IBP, Inc. .................... 600 30,300
--------
89,700
--------
TOBACCO--2.7%
Philip Morris Cos., Inc. ..... 1,500 $135,750
--------
355,762
--------
ENERGY--1.8%
DOMESTIC PRODUCERS--1.6%
Amoco Corp. .................. 500 35,938
Mobil Corp. .................. 400 44,800
--------
80,738
--------
PIPELINES--0.2%
Enron Corp. .................. 200 7,625
--------
88,363
--------
FINANCE--9.6%
BANKING & CREDIT--6.4%
American Express Co. ......... 2,000 82,750
Bank of New York Co., Inc. ... 3,000 146,250
Citicorp ..................... 1,000 67,250
First Bank System, Inc. ...... 500 24,812
--------
321,062
--------
INSURANCE--3.2%
AFLAC, Inc. .................. 100 4,338
General Reinsurance Corp. .... 1,000 155,000
--------
159,338
--------
480,400
--------
HEALTH CARE--5.0%
DRUGS--1.6%
Pfizer, Inc. ................. 1,300 81,900
--------
MEDICAL PRODUCTS--2.8%
Cardinal Health, Inc. ........ 500 27,375
Medtronic, Inc. .............. 2,000 111,750
--------
139,125
--------
MEDICAL SERVICES--0.6%
HealthCare Compare Corp.* .... 700 30,581
--------
251,606
--------
MULTI INDUSTRY
COMPANIES--0.4%
Tyco International Ltd. ...... 600 21,375
--------
TECHNOLOGY--2.9%
COMMUNICATIONS
EQUIPMENT--0.2%
ADC Telecommunications, Inc.* 300 10,913
--------
COMPUTER HARDWARE--0.9%
3Com Corp.* (a) .............. 400 18,675
Sun Microsystems, Inc.* ...... 600 27,412
--------
46,087
--------
51
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
SHARES OR
PRINCIPAL
(000) U.S.$ VALUE
---------- -----------
COMPUTER SOFTWARE &
SERVICES--1.8%
Oracle Corp.* ................................. 400 $ 16,950
Paychex, Inc. ................................. 1,000 49,687
Reynolds & Reynolds Co. ....................... 500 19,438
--------
86,075
--------
143,075
--------
TRANSPORTATION--0.4%
RAILROADS--0.4%
Illinois Central Corp. ........................ 500 19,188
--------
UTILITIES--4.2%
TELEPHONE--4.2%
Cincinnati Bell, Inc. ......................... 1,500 52,125
Nynex Corp. ................................... 1,700 91,800
SBC Communications, Inc. ...................... 1,100 63,250
--------
207,175
--------
Total Common Stocks
(cost $1,867,183) .......................... 2,056,219
----------
U.S. GOVERNMENT
OBLIGATIONS--24.6%
U.S. Treasury Bonds
6.875%, 8/15/25 ............................ $ 460 518,792
7.625%, 2/15/25 ............................ 68 83,151
U.S. Treasury Notes
5.75%, 10/31/00 ............................ 110 111,581
5.875%, 8/15/98 ............................ 100 101,578
5.875%, 11/15/05 ........................... $ 250 $255,625
6.50%, 8/15/05 ............................. 60 63,919
7.25%, 2/15/98 ............................. 60 62,390
7.75%, 12/31/99 ............................ 25 27,129
---------
Total U.S. Government Obligations
(cost $1,179,716) .......................... 1,224,165
---------
SHORT-TERM INVESTMENTS--40.2%
U.S. GOVERNMENT
OBLIGATIONS--40.2%
Federal Farm Credit Bank
5.50%, 1/05/96 ............................. 500 499,695
Federal Home Loan Bank
5.50%, 1/05/96 ............................. 500 499,694
Federal Home Loan Mortgage Corp. ..............
5.75%, 1/02/96 ............................. 1,000 999,840
----------
Total Short-Term Investments
(amortized cost $1,999,229) ................ 1,999,229
-----------
TOTAL INVESTMENTS--106.1%
(cost $5,046,128) .......................... 5,279,613
Other assets less liabilities--(6.1%) ......... (301,497)
----------
NET ASSETS--100.0%................... $4,978,116
===========
- ------------------------------------------------------------------------------------------------------------------------
* Non-income producing security.
(a) Securities exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration normally applied to certain qualified buyers. At December
31, 1995, the aggregate market value of these securities amounted to
$18,675 or 0.4% of net assets.
See Notes to Financial Statements.
GLOSSARY OF TERMS
ADR - American Depository Receipts
FRN - Floating Rate Note
GDR - Global Depository Receipts
IDU - Interest Due on Unpaid Bond
ORD - Ordinary
PDI - Past Due Interest Bonds
52
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PREMIER GLOBAL GROWTH AND SHORT-TERM
GROWTH BOND INCOME MULTI-MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- -------------
<S> <C> <C> <C> <C>
ASSETS
Investments in securities, at value (cost
$62,648,886, $10,862,330, $73,530,350 and
$10,612,442, respectively) .................................. $65,966,206 $11,169,715 $77,997,208 $ 10,609,349
Cash, at value (cost $-0-, $19,693, $304,765 and
$-0-, respectively) ......................................... -0- 19,515 305,262 -0-
Receivable for investment securities sold ..................... 4,073,626 -0- 114,395 1,245,480
Receivable for capital stock sold ............................. 176,399 45,083 136,140 14,284
Dividends receivable .......................................... 95,107 -0- 141,492 -0-
Deferred organization expenses ................................ 8,169 2,136 658 -0-
Interest receivable ........................................... 5,314 341,849 -0- 31,280
Unrealized appreciation of forward exchange
currency contracts .......................................... -0- 12,865 -0- -0-
Receivable from investment adviser ............................ -0- 5,366 -0- 8,197
----------- ----------- ----------- ------------
Total assets .................................................. 70,324,821 11,596,529 78,695,155 11,908,590
----------- ----------- ----------- ------------
LIABILITIES
Due to custodian .............................................. 45,330 -0- -0- 22,207
Payable for capital stock redeemed ............................ 40,918,447 2,848 36,617,680 8,644,807
Investment advisory fee payable ............................... 49,803 -0- 40,923 -0-
Unrealized depreciation of forward exchange
currency contracts .......................................... -0- -0- -0- 47,357
Accrued expenses .............................................. 32,947 40,704 43,724 42,141
----------- ----------- ----------- ------------
Total liabilities ............................................. 41,046,527 43,552 36,702,327 8,756,512
----------- ----------- ----------- ------------
NET ASSETS ....................................................... $29,278,294 $11,552,977 $41,992,828 $ 3,152,078
=========== =========== =========== ============
COMPOSITION OF NET ASSETS
Capital stock, at par ......................................... $ 1,645 $ 951 $ 2,659 $ 298
Additional paid-in capital .................................... 8,825,473 9,905,081 24,838,801 3,939,381
Undistributed net investment income ........................... 312,649 1,034,881 1,130,049 369,422
Accumulated net realized gain (loss) on investments,
options and foreign currency transactions ................... 16,821,207 289,940 11,553,964 (1,107,325)
Net unrealized appreciation (depreciation) of investments
and foreign currency denominated assets and liabilities ..... 3,317,320 322,124 4,467,355 (49,698)
----------- ----------- ----------- ------------
$29,278,294 $11,552,977 $41,992,828 $ 3,152,078
=========== =========== =========== ============
Shares of capital stock outstanding ........................... 1,644,774 950,828 2,658,797 298,038
=========== =========== =========== ============
Net asset value per share ..................................... $17.80 $12.15 $ 15.79 $10.58
=========== =========== =========== ============
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
53
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT/
HIGH GRADE TOTAL MONEY
SECURITIES RETURN INTERNATIONAL MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- --------- ------------- ---------
<S> <C> <C> <C> <C>
ASSETS
Investment in securities, at value (cost
$16,598,482, $8,256,562, $16,029,364 and
$32,455,268, respectively) ............................................ $17,192,644 $ 8,672,561 $16,760,074 $ 32,455,268
Cash, at value (cost $30,619, $149,597, $352,983 and
$789,081, respectively) ............................................... 30,619 149,597 351,754 789,081
Interest receivable ..................................................... 310,168 48,216 653 -0-
Receivable for capital stock sold ....................................... 43,482 1,583 113,931 111,468
Deferred organization expenses .......................................... 8,350 9,712 9,948 9,976
Dividends receivable .................................................... 1,181 6,445 31,554 -0-
Receivable for investment securities sold ............................... -0- 50,693 69,976 -0-
Receivable from investment adviser ...................................... -0- 7,467 16,513 -0-
Unrealized appreciation of forward exchange
currency contracts .................................................... -0- -0- 10,433 -0-
----------- ----------- ----------- ------------
Total assets ............................................................ 17,586,444 8,946,274 17,364,836 33,365,793
----------- ----------- ----------- ------------
LIABILITIES
Payable for capital stock redeemed ...................................... 586,796 66,390 218,205 5,197,155
Unrealized depreciation of forward exchange
currency contracts .................................................... 12,642 -0- -0- -0-
Investment advisory fee payable ......................................... 3,089 -0- -0- 15,489
Payable for investment securities purchased ............................. -0- 574,751 510,233 -0-
Accrued expenses ........................................................ 37,398 62,692 94,763 60,841
----------- ----------- ----------- ------------
Total liabilities ....................................................... 639,925 703,833 823,201 5,273,485
----------- ----------- ----------- ------------
NET ASSETS ................................................................. $16,946,519 $ 8,242,441 $16,541,635 $ 28,092,308
=========== =========== =========== ============
COMPOSITION OF NET ASSETS
Capital stock, at par ................................................... $ 1,453 $ 644 $ 1,176 $ 28,092
Additional paid-in capital .............................................. 15,448,164 7,692,772 15,463,278 28,063,170
Undistributed net investment income ..................................... 620,469 87,921 154,797 803
Accumulated net realized gain on investments and
foreign currency transactions ......................................... 295,645 45,105 182,395 243
Net unrealized appreciation of investments and foreign
currency denominated assets and liabilities ........................... 580,788 415,999 739,989 -0-
----------- ----------- ----------- ------------
$16,946,519 $ 8,242,441 $16,541,635 $ 28,092,308
=========== =========== =========== ============
Shares of capital stock outstanding ..................................... 1,453,146 643,972 1,175,986 28,092,065
=========== =========== =========== ============
Net asset value per share ............................................... $11.66 $12.80 $14.07 $1.00
=========== =========== =========== ============
- ----------------------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements.
</TABLE>
54
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
NORTH AMERICAN
GLOBAL DOLLAR GOVERNMENT UTILITY
GOVERNMENT INCOME INCOME GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- --------- ------------- ---------
<S> <C> <C> <C> <C>
ASSETS
Investments in securities, at value (cost
$3,449,861, $6,582,624, $5,929,303 and
$42,069,250, respectively) ............................................ $ 3,714,402 $ 6,900,435 $ 6,232,496 $ 45,770,546
Cash, at value (cost $856, $277,378, $121,129 and
$410,571, respectively) ............................................... 856 277,342 121,129 410,700
Interest receivable ..................................................... 74,953 74,908 -0- 7,408
Deferred organization expenses .......................................... 11,144 14,384 10,263 7,408
Receivable from investment adviser ...................................... 8,149 6,650 9,082 -0-
Receivable for investment securities sold ............................... 2,402 62,250 15,061 268,600
Receivable for capital stock sold ....................................... 1,879 -0- 22,557 346,840
Dividends receivable .................................................... -0- -0- 14,567 60,005
----------- ----------- ----------- ------------
Total assets ............................................................ 3,813,785 7,335,969 6,425,155 46,871,507
----------- ----------- ----------- ------------
LIABILITIES
Payable for capital stock redeemed ...................................... 193 18,932 57 28
Unrealized depreciation of forward exchange
currency contracts .................................................... -0- 2,068 -0- -0-
Payable for investment securities purchased ............................. -0- -0- 143,853 1,585,587
Investment advisory fee payable ......................................... -0- -0- -0- 26,540
Accrued expenses ........................................................ 35,497 37,042 30,704 39,641
----------- ----------- ----------- ------------
Total liabilities ....................................................... 35,690 58,042 174,614 1,651,796
----------- ----------- ----------- ------------
NET ASSETS ................................................................. $ 3,778,095 $ 7,277,927 $ 6,250,541 $ 45,219,711
=========== =========== =========== ============
COMPOSITION OF NET ASSETS
Capital stock, at par ................................................... $ 316 $ 695 $ 521 $ 3,177
Additional paid-in capital .............................................. 3,311,542 6,910,039 5,727,085 39,796,861
Undistributed net investment income ..................................... 188,559 47,940 81,328 266,542
Accumulated net realized gain on investments
and foreign currency transactions ..................................... 13,137 3,539 138,414 1,451,706
Net unrealized appreciation of investments and
foreign currency denominated assets and liabilities ................... 264,541 315,714 303,193 3,701,425
----------- ----------- ----------- ------------
$ 3,778,095 $ 7,277,927 $ 6,250,541 $ 45,219,711
=========== =========== =========== ============
Shares of capital stock outstanding ..................................... 316,166 694,380 520,402 3,177,065
=========== =========== =========== ============
Net asset value per share ............................................... $11.95 $10.48 $12.01 $14.23
=========== =========== =========== ============
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
55
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
WORLDWIDE CONSERVATIVE GROWTH
PRIVATIZATION INVESTORS INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------ ----------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value (cost $5,733,412,
$7,001,245 and $5,046,128, respectively) ............................... $ 5,949,284 $7,258,094 $5,279,613
Cash, at value (cost $1,316, $114,257 and $58,386,
respectively) .......................................................... 1,319 114,257 58,386
Receivable for capital stock sold ........................................ 52,029 159,819 -0-
Dividends receivable ..................................................... 15,848 1,471 2,504
Receivable from investment adviser ....................................... 9,359 6,570 8,470
Deferred organization expenses ........................................... 7,452 7,644 7,644
Interest receivable ...................................................... 901 69,627 23,187
----------- ---------- ----------
Total assets ............................................................. 6,036,192 7,617,482 5,379,804
----------- ---------- ----------
LIABILITIES
Payable for investment securities purchased .............................. 48,900 160,351 363,964
Payable for capital stock redeemed ....................................... 736 -0- 2,362
Accrued expenses ......................................................... 39,782 37,411 35,362
----------- ---------- ----------
Total liabilities ........................................................ 89,418 197,762 401,688
----------- ---------- ----------
NET ASSETS .................................................................. $ 5,946,774 $7,419,720 $4,978,116
=========== ========== ==========
COMPOSITION OF NET ASSETS
Capital stock, at par .................................................... $ 532 $ 631 $ 419
Additional paid-in capital ............................................... 5,683,909 6,979,641 4,671,968
Undistributed net investment income ...................................... 90,277 127,336 55,987
Accumulated net realized gain (loss) on investments
and foreign currency transactions ...................................... (43,764) 55,263 16,257
Net unrealized appreciation of investments and foreign
currency denominated assets and liabilities ............................ 215,820 256,849 233,485
----------- ---------- ----------
$ 5,946,774 $7,419,720 $4,978,116
=========== ========== ==========
Shares of capital stock outstanding ...................................... 532,219 630,671 419,292
=========== ========== ==========
Net asset value per share ................................................ $11.17 $11.76 $11.87
=========== ========== ==========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
56
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
PREMIER GLOBAL GROWTH AND SHORT-TERM
GROWTH BOND INCOME MULTI-MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------- ---------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends (net of foreign tax withheld of $3,545, $-0-,
$12,341 and $-0-, respectively)...................... $ 732,514 $ -0- $ 1,243,872 $ -0-
Interest (net of foreign tax withheld of $-0-, $2,384,
$-0- and $554, respectively)......................... 123,151 652,234 350,546 1,458,970
----------- ----------- ----------- ----------
Total investment income................................ 855,665 652,234 1,594,418 1,458,970
----------- ----------- ----------- ----------
EXPENSES
Investment advisory fee................................ 570,739 59,122 362,532 87,500
Custodian.............................................. 60,995 56,052 58,457 76,026
Audit and legal........................................ 25,921 26,079 26,078 25,823
Printing............................................... 7,676 10,137 4,300 6,733
Amortization of organization expenses 5,497 3,975 4,449 4,040
Directors fees......................................... 2,129 1,257 1,113 1,857
Transfer agency........................................ 2,062 1,982 677 1,701
Miscellaneous.......................................... 3,077 2,031 2,819 2,953
----------- ----------- ----------- ----------
Total expenses......................................... 678,096 160,635 460,425 206,633
Less: expense reimbursement............................ (135,894) (74,231) -0- (55,497)
----------- ----------- ----------- ----------
Net expenses........................................... 542,202 86,404 460,425 151,136
----------- ----------- ----------- ----------
Net investment income.................................. 313,463 565,830 1,133,993 1,307,834
----------- ----------- ----------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on investment transactions .... 16,824,672 445,890 11,527,647 (910,867)
Net realized gain (loss) on foreign currency
transactions .......................................... -0- 466,026 18,489 (964,669)
Net change in unrealized appreciation of investments 3,054,025 428,457 4,605,384 1,523,232
Net change in unrealized appreciation (depreciation) of
foreign currency denominated assets and liabilities -0- 17,928 503 (99,392)
----------- ---------- ------------ ----------
Net gain (loss) on investments 19,878,697 1,358,301 16,152,023 (451,696)
------------- ---------- ------------ ----------
NET INCREASE IN NET ASSETS FROM OPERATIONS $20,192,160 $1,924,131 $17,286,016 $ 856,138
============== ========== ============ ==========
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
57
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT/
HIGH GRADE TOTAL MONEY
SECURITIES RETURN INTERNATIONAL MARKET
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------- ---------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest ............................................ $ 690,988 $ 82,373 $ 73,765 $ 954,316
Dividends (net of foreign tax withheld of $-0-, $72,
$30,118 and $-0-, respectively) ................... 4,725 32,210 175,323 -0-
---------- ----------- ----------- ---------
Total investment income ............................. 695,713 114,583 249,088 954,316
---------- ----------- ----------- ---------
EXPENSES
Investment advisory fee ............................. 60,388 17,443 105,532 82,265
Custodian ........................................... 52,007 61,129 163,334 49,488
Audit and legal ..................................... 26,182 26,612 26,361 25,011
Printing ............................................ 10,287 11,083 8,463 10,533
Amortization of organization expenses ............... 4,873 4,873 4,993 4,993
Transfer agency ..................................... 1,719 1,707 2,096 1,873
Directors fees ...................................... 1,457 1,021 2,574 205
Miscellaneous ....................................... 2,483 1,347 2,252 2,138
---------- ----------- ----------- ---------
Total expenses ...................................... 159,396 125,215 315,605 176,506
Less: expense reimbursement ......................... (63,782) (98,702) (215,349) (20,203)
---------- ----------- ----------- ---------
Net expenses ........................................ 95,614 26,513 100,256 156,303
---------- ----------- ----------- ---------
Net investment income ............................... 600,099 88,070 148,832 798,013
---------- ----------- ----------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain on investment transactions ........ 319,393 49,542 60,209 726
Net realized gain on foreign currency transactions .. 29,033 -0- 136,755 -0-
Net change in unrealized appreciation of investments 791,180 424,620 812,079 -0-
Net change in unrealized appreciation (depreciation)
of foreign currency denominated assets and
liabilities ......................................... (13,374) -0- 11,149 -0-
---------- ----------- ----------- ---------
Net gain on investments ............................. 1,126,232 474,162 1,020,192 726
---------- ----------- ----------- ---------
NET INCREASE IN NET ASSETS FROM OPERATIONS ............. $1,726,331 $ 562,232 $ 1,169,024 $ 798,739
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
58
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
NORTH AMERICAN
GLOBAL DOLLAR GOVERNMENT UTILITY
GOVERNMENT INCOME INCOME GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- ------------- ---------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest ................................................ $ 211,731 $ 677,811 $ 13,221 $ 139,162
Dividends (net of foreign tax withheld of $-0-, $-0-,
$968 and $2,101, respectively) ........................ -0- -0- 96,576 328,404
---------- ----------- ----------- ---------
Total investment income ................................. 211,731 677,811 109,797 467,566
---------- ----------- ----------- ---------
EXPENSES
Investment advisory fee ................................. 16,541 33,402 22,348 154,907
Custodian ............................................... 48,351 55,017 55,366 72,170
Audit and legal ......................................... 23,943 25,126 22,967 24,616
Printing ................................................ 7,136 8,047 2,299 1,089
Amortization of organization expenses ................... 4,241 5,855 3,743 2,000
Transfer agency ......................................... 1,933 2,017 1,871 1,923
Directors fees .......................................... 1,891 737 1,007 1,430
Miscellaneous ........................................... 2,336 1,848 3,206 3,485
---------- ----------- ----------- ---------
Total expenses .......................................... 106,372 132,049 112,807 261,620
Less: expense reimbursement ............................. (85,420) (83,230) (84,500) (65,405)
---------- ----------- ----------- ---------
Net expenses ............................................ 20,952 48,819 28,307 196,215
---------- ----------- ----------- ---------
Net investment income ................................... 190,779 628,992 81,490 271,351
---------- ----------- ----------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain on investment transactions ............ 13,908 21,305 146,191 1,503,347
Net realized gain (loss) on foreign currency transactions -0- (582,809) 2,026 (8,006)
Net change in unrealized appreciation of investments .... 317,262 1,033,552 336,155 3,495,390
Net change in unrealized appreciation (depreciation) of
foreign currency denominated assets and liabilities ... -0- (2,088) -0- 129
---------- ----------- ----------- ---------
Net gain on investments ................................. 331,170 469,960 484,372 4,990,860
---------- ----------- ----------- ---------
NET INCREASE IN NET ASSETS FROM OPERATIONS ................. $ 521,949 $ 1,098,952 $ 565,862 $5,262,211
========== =========== =========== ==========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
59
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
WORLDWIDE CONSERVATIVE GROWTH
PRIVATIZATION INVESTORS INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME
Interest .............................................. $67,167 $ 148,178 $ 61,097
Dividends (net of foreign tax withheld of $7,521, $-0-,
and $-0-, respectively) ............................. 58,801 5,367 11,256
------- --------- --------
Total investment income ............................... 125,968 153,545 72,353
------- --------- --------
EXPENSES
Investment advisory fee ............................... 32,207 20,567 13,051
Custodian ............................................. 65,219 55,590 54,965
Audit and legal ....................................... 23,738 27,485 29,011
Printing .............................................. 4,706 5,791 3,499
Amortization of organization expenses ................. 2,000 2,000 2,000
Transfer agency ....................................... 1,926 1,362 1,997
Directors fees ........................................ 1,478 2,384 1,613
Miscellaneous ......................................... 2,878 1,423 1,314
------- --------- --------
Total expenses ........................................ 134,152 116,602 107,450
Less: expense reimbursement ........................... (103,555) (90,550) (90,920)
-------- --------- --------
Net expenses .......................................... 30,597 26,052 16,530
------- --------- --------
Net investment income ................................. 95,371 127,493 55,823
------- --------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on investment transactions ... (45,435) 55,975 16,967
Net realized loss on foreign currency transactions .... (3,414) -0- -0-
Net change in unrealized appreciation of investments .. 215,872 255,556 237,378
Net change in unrealized depreciation of foreign
currency denominated assets and liabilities ......... (52) -0- -0-
-------- --------- --------
Net gain on investments ............................... 166,971 311,531 254,345
------- --------- --------
NET INCREASE IN NET ASSETS FROM OPERATIONS ............... $262,342 $ 439,024 $310,168
========= ========= ========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
60
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
PREMIER GROWTH PORTFOLIO GLOBAL BOND PORTFOLIO
------------------------------ -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 313,463 $ 97,606 $ 565,830 $ 408,590
Net realized gain (loss) on investment transactions ..... 16,824,672 271,826 445,890 (154,419)
Net realized gain (loss) on foreign currency
transactions .......................................... -0- -0- 466,026 (253,681)
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 3,054,025 (1,055,863) 446,385 (353,957)
---------- ----------- ----------- ---------
Net increase (decrease) in net assets
from operations ....................................... 20,192,160 (686,431) 1,924,131 (353,467)
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ................................... (97,581) (20,473) (72,090) (383,604)
Net realized gain on investments and foreign
currency transactions ................................. (273,977) (56,132) -0- (181,669)
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) ................................. (28,211,402) 24,773,454 2,402,867 1,468,349
---------- ----------- ----------- ---------
Total increase (decrease) ............................... (8,390,800) 24,010,418 4,254,908 549,609
NET ASSETS
Beginning of period ..................................... 37,669,094 13,658,676 7,298,069 6,748,460
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $312,649, $95,835,
$1,034,881 and $70,965, respectively) ................. $29,278,294 $37,669,094 $11,552,977 $7,298,069
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
61
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME PORTFOLIO SHORT-TERM MULTI-MARKET PORTFOLIO
--------------------------- ---------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $1,133,993 $ 556,186 $ 1,307,834 $1,675,123
Net realized gain (loss) on investment transactions ..... 11,527,647 605,669 (910,867) (567,154)
Net realized gain (loss) on foreign currency
transactions .......................................... 18,489 (50) (964,669) (1,385,266)
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 4,605,887 (1,403,807) 1,423,840 (1,215,362)
---------- ----------- ----------- ----------
Net increase (decrease) in net assets
from operations ....................................... 17,286,016 (242,002) 856,138 (1,492,659)
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ................................... (531,525) (277,061) -0- (1,057,212)
Net realized gain on investments and foreign
currency transactions ................................. (551,658) (484,873) -0- -0-
Return of capital ....................................... -0- -0- -0- (940)
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) ................................. (15,911,876) 19,950,283 (18,624,919) (88,801)
----------- ----------- ----------- ---------
Total increase (decrease) ............................... 290,957 18,946,347 (17,768,781) (2,639,612)
NET ASSETS
Beginning of period ..................................... 41,701,871 22,755,524 20,920,859 23,560,471
---------- ----------- ----------- ----------
End of period (including undistributed
(overdistributed) net investment income of
$1,130,049, $539,879, $369,422 and
$(2,357), respectively) ............................... $41,992,828 $41,701,871 $ 3,152,078 $20,920,859
=========== =========== =========== ===========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
62
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT/
HIGH GRADE SECURITIES PORTFOLIO TOTAL RETURN PORTFOLIO
------------------------------- ----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------ ------------ ------------ ----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 600,099 $ 147,656 $ 88,070 $ 9,704
Net realized gain (loss) on investment transactions ..... 319,393 (29,780) 49,542 (4,437)
Net realized gain on foreign currency
transactions .......................................... 29,033 -0- -0- -0-
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 777,806 (182,479) 424,620 (22,102)
---------- ----------- ----------- ---------
Net increase (decrease) in net assets
from operations ....................................... 1,726,331 (64,603) 562,232 (16,835)
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ................................... (149,971) (52,816) (10,089) (3,795)
Net realized gain on investments ........................ -0- (35,522) -0- (2,282)
CAPITAL STOCK TRANSACTIONS
Net increase ............................................ 10,268,875 3,903,950 6,940,398 412,828
---------- ----------- ----------- ---------
Total increase .......................................... 11,845,235 3,751,009 7,492,541 389,916
NET ASSETS
Beginning of period ..................................... 5,101,284 1,350,275 749,900 359,984
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $620,469, $147,340,
$87,921 and $9,940, respectively) ..................... $16,946,519 $ 5,101,284 $ 8,242,441 $ 749,900
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
63
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO MONEY MARKET PORTFOLIO
----------------------- ----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------ ----------- ------------ ----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 148,832 $ 25,102 $ 798,013 $ 82,719
Net realized gain (loss) on investment transactions ..... 60,209 18,758 726 (473)
Net realized gain on foreign currency
transactions .......................................... 136,755 1,982 -0- -0-
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 823,228 (106,701) -0- -0-
---------- ----------- ----------- ---------
Net increase (decrease) in net assets
from operations ....................................... 1,169,024 (60,859) 798,739 82,246
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income ................................... (23,594) (1,901) (798,013) (82,719)
Net realized gain on investments and foreign
currency transactions ................................. (29,314) (11,169) -0- -0-
CAPITAL STOCK TRANSACTIONS
Net increase ............................................ 8,149,131 6,662,423 21,193,287 6,797,225
---------- ----------- ----------- ---------
Total increase .......................................... 9,265,247 6,588,494 21,194,013 6,796,752
NET ASSETS
Beginning of period ..................................... 7,276,388 687,894 6,898,295 101,543
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $154,797, $23,907,
$803 and $803, respectively) .......................... $16,541,635 $ 7,276,388 $28,092,308 $6,898,295
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
64
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
GLOBAL DOLLAR NORTH AMERICAN
GOVERNMENT PORTFOLIO GOVERNMENT INCOME PORTFOLIO
-------------------- ---------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994(A) 1995 1994(B)
------------ ------------ ----------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 190,779 $ 25,782 $ 628,992 $ 145,598
Net realized gain (loss) on investment transactions ..... 13,908 (771) 21,305 (12,751)
Net realized loss on foreign currency
transactions .......................................... -0- -0- (582,809) (4,232)
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 317,262 (52,721) 1,031,464 (715,750)
---------- ----------- ----------- ---------
Net increase (decrease) in net assets
from operations ....................................... 521,949 (27,710) 1,098,952 (587,135)
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income ................................... (28,002) -0- (144,624) -0-
CAPITAL STOCK TRANSACTIONS
Net increase ............................................ 2,137,822 1,174,036 2,475,517 4,435,217
---------- ----------- ----------- ---------
Total increase .......................................... 2,631,769 1,146,326 3,429,845 3,848,082
NET ASSETS
Beginning of period ..................................... 1,146,326 -0- 3,848,082 -0-
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $188,559, $25,782,
$47,940 and $141,547, respectively) ................... $3,778,095 $ 1,146,326 $ 7,277,927 $3,848,082
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations, May 2, 1994.
(b) Commencement of operations, May 3, 1994.
See Notes to Financial Statements.
65
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
UTILITY INCOME PORTFOLIO GROWTH PORTFOLIO
------------------------ ----------------
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994(A) 1995 1994(B)
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 81,490 $ 18,849 $ 271,351 $ 11,263
Net realized gain (loss) on investment transactions ..... 146,191 (9,667) 1,503,347 (48,794)
Net realized gain (loss) on foreign currency
transactions .......................................... 2,026 (17) (8,006) -0-
Net change in unrealized appreciation (depreciation)
of investments and foreign currency denominated
assets and liabilities ................................ 336,155 (32,962) 3,495,519 205,906
---------- ----------- ----------- ---------
Net increase (decrease) in net assets
from operations ....................................... 565,862 (23,797) 5,262,211 168,375
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income ................................... (19,130) -0- (10,913) -0-
CAPITAL STOCK TRANSACTIONS
Net increase ............................................ 4,449,560 1,278,046 34,476,649 5,323,389
---------- ----------- ----------- ---------
Total increase .......................................... 4,996,292 1,254,249 39,727,947 5,491,764
NET ASSETS
Beginning of period ..................................... 1,254,249 -0- 5,491,764 -0-
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $81,328, $18,832,
$266,542 and $11,263, respectively) ................... $6,250,541 $ 1,254,249 $45,219,711 $5,491,764
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations, May 10, 1994.
(b) Commencement of operations, September 15, 1994.
See Notes to Financial Statements.
66
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
CONSERVATIVE
WORLDWIDE PRIVATIZATION PORTFOLIO INVESTORS PORTFOLIO
--------------------------------- -------------------
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994(A) 1995 1994(B)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income ................................... $ 95,371 $ 7,184 $ 127,493 $ 3,462
Net realized gain (loss) on investment transactions ..... (45,435) -0- 55,975 (712)
Net realized loss on foreign currency
transactions .......................................... (3,414) -0- -0- -0-
Net change in unrealized appreciation of
investments and foreign currency
denominated assets and liabilities .................... 215,820 -0- 255,556 1,293
---------- ----------- ----------- ---------
Net increase in net assets from operations .............. 262,342 7,184 439,024 4,043
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income ................................... (7,193) -0- (3,619) -0-
CAPITAL STOCK TRANSACTIONS
Net increase ............................................ 4,564,563 1,119,878 6,283,423 696,849
---------- ----------- ----------- ---------
Total increase .......................................... 4,819,712 1,127,062 6,718,828 700,892
NET ASSETS
Beginning of period ..................................... 1,127,062 -0- 700,892 -0-
---------- ----------- ----------- ---------
End of period (including undistributed net
investment income of $90,277, $7,184,
$127,336 and $3,462, respectively) .................... $5,946,774 $ 1,127,062 $ 7,419,720 $ 700,892
========== =========== =========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations, September 23, 1994.
(b) Commencement of operations, October 28, 1994.
See Notes to Financial Statements.
67
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------
GROWTH INVESTORS PORTFOLIO
--------------------------
YEAR ENDED PERIOD ENDED
DECEMBER 31, DECEMBER 31,
1995 1994(A)
---------------- ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income...................................... $ 55,823 $ 1,067
Net realized gain (loss) on investment transactions 16,967 (710)
Net change in unrealized appreciation (depreciation)
of investments........................................... 237,378 (3,893)
----------- -----------
Net increase (decrease) in net assets from operations 310,168 (3,536)
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income...................................... (903) -0-
CAPITAL STOCK TRANSACTIONS
Net increase............................................... 4,348,053 324,334
----------- -----------
Total increase............................................. 4,657,318 320,798
NET ASSETS
Beginning of period........................................ 320,798 -0-
----------- ---------
End of period (including undistributed net investment income
of $55,987 and $1,067, respectively) $ 4,978,116 $ 320,798
=========== =========
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations, October 28, 1994.
See Notes to Financial Statements.
68
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
- -------------------------------------------------------------------------------
NOTE A -- SIGNIFICANT ACCOUNTING POLICIES
Alliance Variable Products Series Fund, Inc. (the "Fund"), was incorporated in
the State of Maryland on November 17, 1987 as an open-end series investment
company. The Fund had no operations prior to November 28, 1990. The Fund offers
fifteen separately managed pools of assets which have differing investment
objectives and policies. The Fund currently issues shares of the Premier Growth
Portfolio, Global Bond Portfolio, Growth and Income Portfolio, Short-Term Multi-
Market Portfolio, U.S. Government/High Grade Securities Portfolio, Total Return
Portfolio, International Portfolio, Money Market Portfolio, Global Dollar
Government Portfolio, North American Government Income Portfolio, Utility Income
Portfolio, Growth Portfolio, Worldwide Privatization Portfolio, Conservative
Investors Portfolio and Growth Investors Portfolio (the "Portfolios"). The
investment objectives of each Portfolio are as follows:
PREMIER GROWTH PORTFOLIO--seeks growth of capital employing aggressive
investment policies. Since investments will be made based upon their potential
for capital appreciation, current income will be incidental to the objective of
capital growth. The Portfolio is not intended for investors whose principal
objective is assured income or preservation of capital.
GLOBAL BOND PORTFOLIO--seeks a high level of return from a combination of
current income and capital appreciation by investing in a globally diversified
portfolio of high quality debt securities denominated in the U.S. Dollar and a
range of foreign currencies.
GROWTH AND INCOME PORTFOLIO--seeks reasonable current income and opportunities
for appreciation through investments primarily in dividend-paying common stocks
of good quality.
SHORT-TERM MULTI-MARKET PORTFOLIO--seeks the highest level of current income,
consistent with what the Fund's Adviser considers to be prudent investment risk,
that is available from a portfolio of high-quality debt securities having
remaining maturities of not more than three years.
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO--seeks a high level of current
income consistent with preservation of capital by investing principally in a
portfolio of U.S. Government securities and other high grade debt securities.
TOTAL RETURN PORTFOLIO--seeks to achieve a high return through a combination of
current income and capital appreciation by investing in a diversified portfolio
of common and preferred stocks, senior corporate debt securities, and U.S.
Government and agency obligations, bonds and senior debt securities.
INTERNATIONAL PORTFOLIO--seeks to obtain a total return on its assets from
long-term growth of capital principally through a broad portfolio of marketable
securities of established non-United States companies, companies participating
in foreign economies with prospects for growth, and foreign government
securities.
MONEY MARKET PORTFOLIO--seeks safety of principal, maintenance of liquidity and
maximum current income by investing in a broadly diversified portfolio of money
market securities.
GLOBAL DOLLAR GOVERNMENT PORTFOLIO--seeks a high level
of current income through investing substantially all of its
assets in U.S. and non-U.S. fixed income securities
denominated only in U.S. Dollars. As a secondary
objective, the Portfolio seeks capital appreciation.
NORTH AMERICAN GOVERNMENT INCOME PORTFOLIO--seeks the highest level of current
income, consistent with what the Fund's Adviser considers to be prudent
investment risk, that is available from a portfolio of debt securities issued or
guaranteed by the governments of the United States, Canada and Mexico, their
political subdivisions (including Canadian Provinces but excluding the States of
the United States), agencies, instrumentalities or authorities. The Portfolio
seeks high current yields by investing in government securities denominated in
local currency and U.S. Dollars. Normally, the Portfolio expects to maintain at
least 25% of its assets in securities denominated in the U.S. Dollar.
69
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- -------------------------------------------------------------------------------
UTILITY INCOME PORTFOLIO--seeks current income and capital appreciation by
investing primarily in the equity and fixed-income securities of companies in
the "utilities industry." The Portfolio's investment objective and policies are
designed to take advantage of the characteristics and historical performance of
securities of utilities companies.
GROWTH PORTFOLIO--seeks long-term growth of capital by investing primarily in
common stocks and other equity securities.
WORLDWIDE PRIVATIZATION PORTFOLIO--seeks long-term capital appreciation by
investing principally in equity securities issued by enterprises that are
undergoing, or have undergone, privatization. The balance of the Portfolio's
investment portfolio will include equity securities of companies that are
believed by the Fund's Adviser to be beneficiaries of the privatization process.
CONSERVATIVE INVESTORS PORTFOLIO--seeks the highest total return without, in the
view of the Fund's Adviser, undue risk to principal by investing in a
diversified mix of publicly traded equity and fixed-income securities.
GROWTH INVESTORS PORTFOLIO--seeks the highest total return consistent with what
the Fund's Adviser considers to be reasonable risk by investing in a diversified
mix of publicly traded equity and fixed-income securities.
The Fund offers and sells its shares only to separate accounts of certain life
insurance companies, for the purpose of funding variable annuity contracts and
variable life insurance policies. Sales are made without a sales charge, at each
Portfolio's net asset value per share.
The following is a summary of significant accounting policies followed by the
Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange are valued at the
last sale price on such exchange on the day of valuation or, if there was no
sale on such day, the last bid price quoted on such day. Listed securities not
traded and securities traded in the over-the-counter market, including listed
debt securities whose primary market is believed to be over-the-counter, are
valued at the mean between the most recent quoted bid and asked prices provided
by the principal market makers. Publicly traded sovereign debt obligations are
typically traded internationally on the over-the-counter market. Readily
marketable sovereign debt obligations and fixed income securities may be valued
on the basis of prices provided by a pricing service when such prices are
believed by the Adviser to reflect the fair value of such securities. Options
are valued at market value or fair value using methods determined by the Board
of Directors. Securities for which market quotations are not readily available
are valued in good faith at fair value using methods determined by the Board of
Directors. Securities which mature in 60 days or less are valued at amortized
cost, which approximates market value, unless this method does not represent
fair value.
2. OPTION WRITING
When a Portfolio writes an option, an amount equal to the premium received by
the Portfolio is recorded as a liability and is subsequently adjusted to the
current market value of the option written. Premiums received from writing
options which expire unexercised are recorded by the Portfolio on the expiration
date as realized gains. The difference between the premium and the amount paid
on effecting a closing purchase transaction, including brokerage commissions, is
also recorded as a realized gain, or if the premium is less than the amount paid
for the closing purchase transaction, as a realized loss. If a call option is
exercised, the premium is added to the proceeds from the sale of the underlying
security or currency in determining whether the Portfolio has realized a gain or
loss. If a put option is exercised, the premium reduces the cost basis of the
security or currency purchased by the Portfolio. In writing an option, the
Portfolio bears the market risk of unfavorable changes in the price of the
security or currency underlying the written option. Exercise of an option
written by the Portfolio could result in the Portfolio selling or buying a
security or currency at a price different from the current market value.
70
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- -------------------------------------------------------------------------------
3. CURRENCY TRANSLATION
Assets and liabilities denominated in foreign currencies and commitments under
forward exchange currency contracts are translated into U.S. dollars at the mean
of the quoted bid and asked prices of such currencies against the U.S. dollar.
Purchases and sales of portfolio securities are translated at the rates of
exchange prevailing when such securities were acquired or sold. Income and
expenses are translated at rates of exchange prevailing when accrued.
The Portfolios isolate that portion of the results of operations resulting from
changes in foreign exchange rates on investments from the fluctuations arising
from changes in market prices of securities held.
Net foreign exchange gains (losses) of $466,026, $18,489, $(964,669), $29,033,
$136,755, $(582,809), $2,026, $(8,006) and $(3,414) for the Global Bond
Portfolio, Growth and Income Portfolio, Short-Term Multi-Market Portfolio, U.S.
Government/High Grade Securities Portfolio, International Portfolio, North
American Government Income Portfolio, Utility Income Portfolio, Growth Portfolio
and Worldwide Privatization Portfolio, respectively, represent foreign exchange
gains and losses from sales and maturities of securities, holding of foreign
currencies, options on foreign currencies, exchange gains or losses realized
between the trade and settlement dates on security transactions, and the
difference between the amounts of interest and dividends recorded on the
Portfolio's books and the U.S. dollar equivalent of the amounts actually
received or paid.
Net currency gains and losses from valuing foreign currency denominated assets
and liabilities at period end exchange rates are reflected as a component of
unrealized appreciation (depreciation) on investments and foreign currency
denominated assets and liabilities.
4. ORGANIZATION EXPENSES
Organization expenses of each Portfolio have been deferred and are being
amortized on a straight-line basis as follows: Premier Growth Portfolio $27,506
through June 1997; Global Bond Portfolio $19,898 through July 1996; Growth and
Income Portfolio $22,263 through January 1996; Short-Term Multi-Market Portfolio
$22,263 through November 1995; U.S. Government/High Grade Securities Portfolio
$24,384 through September 1997; Total Return Portfolio $24,384 through December
1997; International Portfolio $24,983 through December 1997; Money Market
Portfolio $24,983 through December 1997; Global Dollar Government Portfolio
$16,723 through April 1999; North American Government Income Portfolio $21,570
through April 1999; Utility Income Portfolio $15,299 through April 1999; Growth
Portfolio $10,000 through September 1999; Worldwide Privatization Portfolio
$10,000 through September 1999; Conservative Investors Portfolio $10,000 through
October 1999 and Growth Investors Portfolio $10,000 through October 1999.
5. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if applicable, to
shareholders. Therefore, no provisions for federal income taxes are required.
6. INVESTMENT INCOME AND SECURITY TRANSACTIONS
Interest income is accrued daily.
Dividend income is recorded on the ex-dividend date. Security transactions are
accounted for on the date securities are purchased or sold. Security gains and
losses are determined on the identified cost basis. The Fund accretes discounts
as adjustments to interest income.
7. DIVIDENDS AND DISTRIBUTIONS
Each Portfolio declares and distributes dividends and distributions from net
investment income and net realized gains, respectively, if any, at least
annually, except for dividends on the Money Market Portfolio, which are declared
daily and paid monthly. Income dividends and capital gain distributions are
determined in accordance with income tax regulations.
71
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- -------------------------------------------------------------------------------
NOTE B -- ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an investment advisory agreement, each Portfolio pays
Alliance Capital Management L.P., (the "Adviser"), an investment advisory fee,
based on average net assets at the following annual rates: Premier Growth
Portfolio, 1%; Global Bond Portfolio, .65 of 1%; Growth and Income Portfolio,
.625 of 1%; Short- Term Multi-Market Portfolio, .55 of 1%; U.S. Government/High
Grade Securities Portfolio, .60 of 1%; Total Return Portfolio, .625 of 1%;
International Portfolio, 1%; Money Market Portfolio, .50 of 1%; Global Dollar
Government Portfolio, .75 of 1%; North American Government Income Portfolio, .65
of 1%; Utility Income Portfolio, .75 of 1%; Growth Portfolio, .75 of 1%;
Worldwide Privatization Portfolio, 1%; Conservative Investors Portfolio, .75 of
1% and Growth Investors Portfolio, .75 of 1%. Such fee is accrued daily and paid
monthly. For the Global Bond Portfolio, the adviser has retained, under a sub-
advisory agreement, a sub-adviser, AIGAM International Ltd., an affiliate of
American International Group, Inc.
The Adviser voluntarily agreed to reimburse each Portfolio based on their
respective average net assets for expenses exceeding .95% for the year ended
December 31, 1995. Expense reimbursements, if any, are accrued daily and paid
monthly. For the year ended December 31, 1995, such reimbursements amounted to
$135,894, $74,231, $55,497, $63,782, $98,702, $215,349, $20,203, $85,420,
$83,230, $84,500, $65,405, $103,555, $90,550 and $90,920 for the Premier Growth
Portfolio, the Global Bond Portfolio, the Short-Term Multi-Market Portfolio, the
U.S. Government/High Grade Securities Portfolio, the Total Return Portfolio, the
International Portfolio, the Money Market Portfolio, the Global Dollar
Government Portfolio, the North American
Government Income Portfolio, the Utility Income Portfolio, the Growth Portfolio,
the Worldwide Privatization Portfolio, the Conservative Investors Portfolio and
the Growth Investors Portfolio, respectively. In addition, for the year ended
December 31, 1995, the Advisers agreed to waive the Global Bond Portfolio's
investment advisory fee in the amount of $59,122.
Each Portfolio compensates Alliance Fund Services, Inc. (a wholly-owned
subsidiary of the Adviser) for providing personnel and facilities to perform
transfer agency services for the Portfolio. Such compensation amounted to $1,050
for the Premier Growth Portfolio, the Global Bond Portfolio, the Growth and
Income Portfolio, the Short-Term Multi-Market Portfolio, the U.S. Govern-
ment/High Grade Securities Portfolio, the Total Return Portfolio, the
International Portfolio, the Money Market Portfolio, the Global Dollar
Government Portfolio, the North American Government Income Portfolio, the
Utility Income Portfolio, the Growth Portfolio, the Worldwide Privatization
Portfolio, the Conservative Investors Portfolio and the Growth Investors
Portfolio, respectively, for the year ended December 31, 1995.
Brokerage commissions paid for the year ended Decem- ber 31, 1995 on securities
transactions amounted to $148,418, $229,432, $64,196, $7,479, $22,347, $104,323,
$11,055, $1,373 and $3,055 on the Premier Growth Portfolio, the Growth and
Income Portfolio, the International Portfolio, the Total Return Portfolio, the
Utility Income Portfolio, the Growth Portfolio, the Worldwide Privatization
Portfolio, the Conservative Investors Portfolio and the Growth Investors
Portfolio, respectively, none of which was paid to affiliated brokers.
72
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- -------------------------------------------------------------------------------
NOTE C -- INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments)
for the year ended December 31, 1995 were as follows:
<TABLE>
<CAPTION>
U.S. GOVERNMENT/
PREMIER GLOBAL GROWTH AND SHORT-TERM HIGH GRADE
GROWTH BOND INCOME MULTI-MARKET SECURITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
PURCHASES
Stocks and debt obligations.................. $ 50,063,245 $ 14,812,089 $ 77,062,008 $ 22,986,853 $ 8,863,096
U.S. Government and government
agency obligations........................ -0- 10,869,805 -0- 395,375 14,606,645
SALES
Stocks and debt obligations.................. 83,623,311 14,327,721 95,003,637 25,779,789 4,602,628
U.S. Government and government
agency obligations........................ -0- 8,579,628 -0- 396,125 7,457,074
</TABLE>
<TABLE>
<CAPTION>
GLOBAL NORTH AMERICAN
TOTAL DOLLAR GOVERNMENT UTILITY
RETURN INTERNATIONAL GOVERNMENT INCOME INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
PURCHASES
Stocks and debt obligations.................. $ 4,715,680 $ 15,583,792 $ 1,901,201 $ 2,619,687 $ 8,055,921
U.S. Government and government
agency obligations........................ 1,964,159 -0- 300,766 857,981 -0-
SALES
Stocks and debt obligations.................. 573,617 8,229,140 73,035 941,835 3,898,743
U.S. Government and government
agency obligations........................ 66,438 -0- 199,317 429,484 -0-
</TABLE>
<TABLE>
<CAPTION>
WORLDWIDE CONSERVATIVE GROWTH
GROWTH PRIVATIZATION INVESTORS INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
PURCHASES
Stocks and debt obligations.................. $ 50,534,340 $ 4,360,558 $ 858,585 $ 2,060,373
U.S. Government and government
agency obligations........................ -0- -0- 3,691,376 1,357,000
SALES
Stocks and debt obligations.................. 16,540,089 548,382 157,545 323,294
U.S. Government and government
agency obligations........................ -0- -0- 723,171 233,289
</TABLE>
73
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- -------------------------------------------------------------------------------
At December 31, 1995, the cost of investments for federal income tax purposes
and the tax basis gross unrealized appreciation, depreciation and net unrealized
appreciation/(depreciation) were as follows:
<TABLE>
<CAPTION>
NET
UNREALIZED
GROSS UNREALIZED APPRECIATION
PORTFOLIO COST APPRECIATION DEPRECIATION (DEPRECIATION)
- --------- ---------------- ------------ ------------ --------------
<S> <C> <C> <C> <C> <C>
Premier Growth.................................. $ 63,153,803 $ 3,908,719 $ (1,096,316) $ 2,812,403
Global Bond..................................... 10,866,314 331,428 (28,027) 303,401
Growth and Income............................... 73,791,337 5,054,250 (848,379) 4,205,871
Short-Term Multi-Market......................... 10,614,262 9,506 (14,419) (4,913)
U.S. Government/High Grade Securities........... 16,598,482 615,988 (21,826) 594,162
Total Return.................................... 8,256,630 464,807 (48,876) 415,931
International................................... 16,081,724 1,061,523 (383,173) 678,350
Global Dollar Government........................ 3,451,736 283,113 (20,447) 262,666
North American Government Income................ 6,582,624 469,356 (151,545) 317,811
Utility Income.................................. 5,946,087 476,187 (189,778) 286,409
Growth.......................................... 42,087,541 4,672,059 (989,054) 3,683,005
Worldwide Privatization......................... 5,733,441 440,828 (224,985) 215,843
Conservative Investors.......................... 7,001,245 259,261 (2,412) 256,849
Growth Investors................................ 5,046,128 249,444 (15,959) 233,485
</TABLE>
At December 31, 1995, for federal income tax purposes, the Short-Term
Multi-Market and Worldwide Privatization Portfolios had net capital loss
carryforwards of $1,103,278 (of which $9,593 expires in 2001, $150,822 expires
in 2002, and $941,594 expires in 2003) and $43,735 which expires 2003,
respectively.
The Global Bond, Short-Term Multi-Market and International Portfolios enter into
forward exchange currency contracts in order to hedge their exposure to changes
in foreign currency exchange rates on their foreign portfolio holdings. A
forward contract is a commitment to purchase or sell a foreign currency at a
future date at a negotiated forward rate. The Portfolios may enter into
contracts to deliver or receive foreign currency it will receive from or require
for its normal investment activities. It may also use contracts in a manner
intended to protect foreign currency-denominated securities from declines in
value due to unfavorable exchange rate movements. The gain or loss
arising from the difference between the original contract and the closing of
such contract is included in realized gains or losses from foreign currency
transactions. Fluctuations in the value of forward exchange currency contracts
are recorded for financial reporting purposes as unrealized gains or losses by
the Portfolio. The Fund's custodian will place and maintain cash not available
for investment or government securities in a separate account of the Fund having
a value equal to the aggregate amount of the Fund's commitments under forward
exchange currency contracts entered into with respect to position hedges. Risks
may arise from the potential inability of a counterparty to meet the terms of a
contract and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar. At December 31, 1995, the outstanding forward
exchange currency contracts were as follows:
74
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
GLOBAL BOND PORTFOLIO:
CONTRACT VALUE ON U.S.$
AMOUNT ORIGINATION CURRENT UNREALIZED
FOREIGN CURRENCY SALE CONTRACTS (000) DATE VALUE APPRECIATION
- ------------------------------- ---------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Japanese Yen, expiring 1/26/96.......................... 90,000 $ 888,100 $ 875,235 $12,865
=======
</TABLE>
SHORT-TERM MULTI-MARKET PORTFOLIO:
<TABLE>
<CAPTION>
CONTRACT VALUE ON U.S.$ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION
FOREIGN CURRENCY BUY CONTRACTS (000) DATE VALUE (DEPRECIATION)
- ------------------------------ ---------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Australian Dollars, expiring 1/16/96-1/18/96............ 854 $ 632,279 $ 634,496 $ 2,217
British Pounds, expiring 1/25/96........................ 469 729,144 728,399 (745)
Canadian Dollars, expiring 1/18/96...................... 1,266 930,859 926,756 (4,103)
Deutsche Marks, expiring 1/22/96-2/05/96................ 7,349 5,123,620 5,131,277 7,657
Finnish Markka, expiring 2/5/96......................... 1,500 346,481 345,452 (1,029)
French Francs, expiring 1/22/96......................... 1,621 327,820 331,201 3,381
Japanese Yen, expiring 1/11/96.......................... 90,000 897,181 873,322 (23,859)
New Zealand Dollars, expiring 1/16/96................... 378 243,953 246,752 2,799
Spanish Pesetas, expiring 1/25/96....................... 134,259 1,098,950 1,103,701 4,751
Swiss Francs, expiring 1/18/96.......................... 682 592,608 592,600 (8)
Thailand Baht, expiring 6/28/96......................... 7,500 292,911 291,465 (1,446)
FOREIGN CURRENCY SALE CONTRACTS
Australian Dollars, expiring 1/18/96.................... 554 412,048 411,720 328
British Pounds, expiring 1/25/96........................ 519 814,398 805,077 9,321
Canadian Dollars, expiring 1/18/96...................... 1,575 1,144,964 1,153,652 (8,688)
Deutsche Marks, expiring 1/22/96-2/05/96................ 7,523 5,115,999 5,251,086 (135,087)
Finnish Markka, expiring 2/05/96........................ 1,500 350,214 345,452 4,762
French Francs, expiring 1/22/96......................... 2,005 405,612 409,563 (3,951)
Japanese Yen, expiring 1/11/96.......................... 120,000 1,300,400 1,165,504 134,896
New Zealand Dollars, expiring 1/16/96................... 378 246,160 246,752 (592)
Spanish Pesetas, expiring 1/25/96....................... 159,475 1,271,423 1,310,994 (39,571)
Swiss Francs, expiring 1/18/96-3/04/96.................. 1,326 1,156,355 1,154,700 1,655
Thailand Baht, expiring 6/28/96......................... 3,750 145,688 145,733 (45)
---------
$ (47,357)
=========
</TABLE>
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO:
<TABLE>
<CAPTION>
CONTRACT VALUE ON U.S.$
AMOUNT ORIGINATION CURRENT UNREALIZED
FOREIGN CURRENCY SALE CONTRACTS (000) DATE VALUE DEPRECIATION
- ------------------------------- ---------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Australian Dollars, expiring 1/08/96.................... 767 $ 565,673 $ 570,117 $ (4,444)
Canadian Dollars, expiring 1/08/96...................... 1,100 800,827 805,387 (4,560)
Deutsche Marks, expiring 1/22/96........................ 1,019 707,484 711,122 (3,638)
---------
$ (12,642)
=========
</TABLE>
75
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO:
CONTRACT VALUE ON U.S.$ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION
FOREIGN CURRENCY SALE CONTRACTS (000) DATE VALUE (DEPRECIATION)
- ------------------------------- ---------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Deutsche Marks, expiring 1/31/96........................ 450 $ 318,990 $ 314,254 $ 4,736
French Francs, expiring 2/29/96......................... 1,500 302,845 306,629 (3,784)
Japanese Yen, expiring 1/31/96.......................... 61,000 603,113 593,632 9,481
---------
$ 10,433
==========
</TABLE>
NORTH AMERICAN GOVERNMENT INCOME PORTFOLIO:
<TABLE>
<CAPTION>
CONTRACT VALUE ON U.S.$
AMOUNT ORIGINATION CURRENT UNREALIZED
FOREIGN CURRENCY SALE CONTRACTS (000) DATE VALUE DEPRECIATION
- ------------------------------- ---------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Canadian Dollars, expiring 1/22/96...................... 871 $ 635,809 $ 637,877 $(2,068)
=======
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE D -- CAPITAL STOCK
There are 900,000,000 shares of capital stock, $.001 par value per share of the
Fund authorized. Transactions in capital stock were as follows:
<TABLE>
<CAPTION>
PREMIER GROWTH PORTFOLIO
---------------------------------------------------------------
SHARES AMOUNT
----------------------------- -----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 2,743,464 2,158,503 $ 42,977,782 $ 27,040,995
Shares issued in reinvestment of dividends
and distributions................................. 24,754 6,295 371,559 76,606
Shares redeemed...................................... (4,167,864) (187,942) (71,560,743) (2,344,147)
----------- ----------- ------------ ------------
Net increase (decrease).............................. (1,399,646) 1,976,856 $(28,211,402) $24,773,454
=========== =========== ============ ===========
GLOBAL BOND PORTFOLIO
----------------------------------------------------------------
SHARES AMOUNT
------------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------------------------- ------------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 232,590 99,445 $2,666,899 $1,004,475
Shares issued in reinvestment of dividends
and distributions................................. 6,352 57,681 72,090 565,272
Shares redeemed...................................... (31,126) (9,522) (336,122) (101,398)
----------- ----------- ------------ ------------
Net increase......................................... 207,816 147,604 $2,402,867 $1,468,349
=========== =========== ============ ==========
</TABLE>
76
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME PORTFOLIO
---------------------------------------------------------------
SHARES AMOUNT
----------------------------- -----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 2,176,403 1,938,671 $ 31,126,890 $23,400,005
Shares issued in reinvestment of dividends
and distributions................................. 79,180 65,234 1,083,182 761,935
Shares redeemed...................................... (3,114,447) (355,050) (48,121,948) (4,211,657)
----------- ----------- ------------ ------------
Net increase (decrease).............................. (858,864) 1,648,855 $(15,911,876) $19,950,283
=========== =========== ============ ==========
SHORT-TERM MULTI-MARKET PORTFOLIO
---------------------------------------------------------------
SHARES AMOUNT
----------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- ------------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 485,653 2,182,196 $ 4,901,077 $ 23,826,681
Shares issued in reinvestment of dividends
and distributions................................. -0- 100,584 -0- 1,058,151
Shares redeemed...................................... (2,299,084) (2,298,689) (23,525,996) (24,973,633)
----------- ----------- ------------ ------------
Net decrease......................................... (1,813,431) (15,909) $(18,624,919) $ (88,801)
=========== =========== ============ ============
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO
---------------------------------------------------------------
SHARES AMOUNT
----------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- ------------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 1,256,331 518,614 $ 13,737,462 $ 5,232,257
Shares issued in reinvestment of dividends
and distributions................................. 13,708 8,852 149,970 88,339
Shares redeemed...................................... (330,322) (140,052) (3,618,557) (1,416,646)
----------- ----------- ------------ ------------
Net increase......................................... 939,717 387,414 $ 10,268,875 $ 3,903,950
=========== =========== ============ ============
TOTAL RETURN PORTFOLIO
---------------------------------------------------------------
SHARES AMOUNT
----------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- ------------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 610,625 69,761 $7,402,831 $ 736,467
Shares issued in reinvestment of dividends
and distributions................................. 866 583 10,089 6,076
Shares redeemed...................................... (39,552) (31,120) (472,522) (329,715)
----------- ----------- ---------- ---------
Net increase......................................... 571,939 39,224 $6,940,398 $ 412,828
=========== =========== ========== =========
</TABLE>
77
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO
----------------------------------------------------------------
SHARES AMOUNT
--------------------------- -----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 761,751 547,184 $ 10,153,923 $ 7,176,460
Shares issued in reinvestment of dividends
and distributions................................. 4,039 1,015 52,908 13,070
Shares redeemed...................................... (154,693) (39,868) (2,057,700) (527,107)
----------- ----------- ------------ ------------
Net increase......................................... 611,097 508,331 $ 8,149,131 $ 6,662,423
=========== =========== ============ ============
MONEY MARKET PORTFOLIO
----------------------------------------------------------------
SHARES AMOUNT
----------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Shares sold.......................................... 72,470,594 14,471,656 $ 72,470,594 $ 14,471,656
Shares issued in reinvestment of dividends........... 799,144 82,845 799,144 82,845
Shares redeemed...................................... (52,076,451) (7,757,276) (52,076,451) (7,757,276)
----------- ----------- ------------ ------------
Net increase......................................... 21,193,287 6,797,225 $ 21,193,287 $ 6,797,225
=========== =========== ============ ============
GLOBAL DOLLAR GOVERNMENT PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED MAY 2, 1994(A) YEAR ENDED MAY 2, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
Shares sold................................. 234,218 118,322 $ 2,508,397 $ 1,192,406
Shares issued in reinvestment of dividends
and distributions........................ 2,647 -0- 28,002 -0-
Shares redeemed............................. (37,201) (1,820) (398,577) (18,370)
----------- ---------- ----------- ------------
Net increase................................ 199,664 116,502 $ 2,137,822 $ 1,174,036
=========== ========== =========== ============
NORTH AMERICAN GOVERNMENT INCOME PORTFOLIO
-------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED MAY 3, 1994(A) YEAR ENDED MAY 3, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
-------------------------------------------------------------------------
Shares sold................................. 528,380 525,199 $ 4,987,369 $ 5,263,041
Shares issued in reinvestment of dividends
and distributions........................ 15,806 -0- 144,624 -0-
Shares redeemed............................. (287,428) (87,577) (2,656,476) (827,824)
----------- ---------- ----------- ------------
Net increase................................ 256,758 437,622 $ 2,475,517 $ 4,435,217
=========== ========== =========== ============
</TABLE>
78
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
UTILITY INCOME PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED MAY 10, 1994(A) YEAR ENDED MAY 10, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold................................. 443,081 130,903 $ 4,987,939 $ 1,329,004
Shares issued in reinvestment of dividends
and distributions........................ 1,762 -0- 19,131 -0-
Shares redeemed............................. (50,420) (4,924) (557,510) (50,958)
----------- ---------- ----------- ------------
Net increase................................ 394,423 125,979 $ 4,449,560 $ 1,278,046
=========== ========== =========== ============
GROWTH PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED SEPTEMBER 15, 1994(A) YEAR ENDED SEPTEMBER 15, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold................................. 2,718,920 525,636 $ 35,309,744 $ 5,364,669
Shares issued in reinvestment of dividends
and distributions........................ 874 -0- 10,912 -0-
Shares redeemed............................. (64,342) (4,023) (844,007) (41,280)
----------- ---------- ------------ ------------
Net increase................................ 2,655,452 521,613 $ 34,476,649 $ 5,323,389
=========== ========== ============ ============
WORLDWIDE PRIVATIZATION PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED SEPTEMBER 23, 1994(A) YEAR ENDED SEPTEMBER 23, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold................................. 430,445 111,619 $ 4,671,434 $ 1,120,370
Shares issued in reinvestment of dividends
and distributions........................ 662 -0- 7,193 -0-
Shares redeemed............................. (10,458) (49) (114,064) (492)
----------- ---------- ----------- ------------
Net increase................................ 420,649 111,570 $ 4,564,563 $ 1,119,878
=========== ========== =========== = =========
CONSERVATIVE INVESTORS PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED OCTOBER 28, 1994(A) YEAR ENDED OCTOBER 28, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold................................. 600,037 71,574 $ 6,706,928 $ 716,743
Shares issued in reinvestment of dividends
and distributions........................ 328 -0- 3,620 -0-
Shares redeemed............................. (39,275) (1,993) (427,125) (19,894)
----------- ---------- ----------- ------------
Net increase................................ 561,090 69,581 $ 6,283,423 $ 696,849
=========== ========== =========== ============
</TABLE>
79
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONT'D)
- ------------------------------------------------------------------------------------------------------------------------
GROWTH INVESTORS PORTFOLIO
------------------------------------------------------------------------
SHARES AMOUNT
---------------------------------- -----------------------------------
YEAR ENDED OCTOBER 28, 1994(A) YEAR ENDED OCTOBER 28, 1994(A)
DECEMBER 31, TO DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold................................. 407,129 34,433 $ 4,571,141 $342,801
Shares issued in reinvestment of dividends
and distributions........................ 83 -0- 903 -0-
Shares redeemed............................. (20,469) (1,884) (223,991) (18,467)
----------- ---------- ----------- --------
Net increase................................ 386,743 32,549 $ 4,348,053 $324,334
=========== ========== =========== ========
</TABLE>
- ---------------
(a) Commencement of operations.
The Premier Growth, Growth and Income and Short-Term Multi-Market Portfolios
liquidated portions of their portfolios to meet significant shareholder
redemption requests that occurred on the last day of the fiscal year. Cash from
the liquidation was invested in short-term securities pending settlement of the
redemption requests on January 2, 1996.
- --------------------------------------------------------------------------------
NOTE E -- RECLASSIFICATION OF COMPONENTS OF NET ASSETS
As a result of permanent differences between accounting and tax regulations in
the treatment of foreign currency transactions, short-term gains and tax returns
of capital distributions, the portfolios made the following reclassifications:
<TABLE>
<CAPTION> U.S. GOVERNMENT/
PREMIER GLOBAL GROWTH AND SHORT-TERM HIGH GRADE
GROWTH BOND INCOME MULTI-MARKET SECURITIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Paid-in capital........................... $ -0- $ -0- $ (1,714) $ (2,334) $ -0-
Undistributed net investment income....... 932 470,176 (12,298) (936,055) 23,001
Undistributed net realized gains.......... (932) (470,176) 14,012 938,389 (23,001)
NORTH AMERICAN
GOVERNMENT UTILITY WORLDWIDE
INTERNATIONAL INCOME INCOME GROWTH PRIVATIZATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- ------------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Paid-in capital........................... $ -0- $ -0- $ -0- $ -0- $ -0-
Undistributed net investment income....... 5,652 (577,975) 136 (5,159) (5,085)
Undistributed net realized gains.......... (5,652) 577,975 (136) 5,159 5,085
</TABLE>
Net investment income, net realized gains and net assets were not affected by
the reclassifications.
80
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
PREMIER GROWTH PORTFOLIO
---------------------------------------------------------
YEAR ENDED DECEMBER 31, JUNE 26, 1992(A)
---------------------------------- TO
1995 1994 1993 DECEMBER 31, 1992
-------- ------ ------ -----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period..................... $12.37 $ 12.79 $ 11.38 $10.00
------ ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)............................. .09(c) .03(c) -0-(c) .06(c)
Net realized and unrealized gain (loss) on investments 5.44 (.41) 1.43 1.32
------ --------- --------- -------
Net increase (decrease) in net asset value from operations 5.53 (.38) 1.43 1.38
------ --------- --------- -------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................. (.03) (.01) (.01) -0-
Distributions from net realized gains................. (.07) (.03) (.01) -0-
------ ------- ------- ------
Total dividends and distributions..................... (.10) (.04) (.02) -0-
------ ------- ------- ------
Net asset value, end of period........................ $17.80 $ 12.37 $ 12.79 $11.38
====== ======= ======= ======
TOTAL RETURN
Total investment return based on net asset value (d) 44.85% (2.96)% 12.63% 13.80%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $29,278 $37,669 $13,659 $3,760
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ........ .95% .95% 1.18% .95%(e)
Expenses, before waivers and reimbursements ........ 1.19% 1.40% 2.05% 4.20%(e)
Net investment income............................... .55% .42% .22% .96%(e)
Portfolio turnover rate............................... 97% 38% 42% 14%
</TABLE>
<TABLE>
<CAPTION>
GLOBAL BOND PORTFOLIO
-----------------------------------------------------------------------
JULY 15, 1991(A)
YEAR ENDED DECEMBER 31, TO
-----------------------------------------------
1995 1994 1993 1992 DECEMBER 31, 1991
-------- -------- -------- -------- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........... $ 9.82 $ 11.33 $ 11.24 $ 11.10 $ 10.00
-------- ------- -------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)..................... .69(c) .57(c) .77(c) .64 .28
Net realized and unrealized gain (loss) on
investments and foreign currency transactions 1.73 (1.16) .43 (.13) .82
-------- ------- -------- ------- -------
Net increase (decrease) in net asset value
from operations............................. 2.42 (.59) 1.20 .51 1.10
-------- ------- -------- ------- -------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.09) (.62) (.85) (.28) -0-
Distributions from net realized gains -0- (.30) (.26) (.09) -0-
-------- ------- -------- ------- -------
Total dividends and distributions............. (.09) (.92) (1.11) (.37) -0-
-------- ------- -------- ------- -------
Net asset value, end of period................ $ 12.15 $ 9.82 $ 11.33 $ 11.24 $ 11.10
======= ======= ======= ======= =======
TOTAL RETURN
Total investment return based on
net asset value (d)......................... 24.73% (5.16)% 11.15% 4.87% 11.00%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $11,553 $7,298 $6,748 $5,876 $5,551
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .95% 1.50% 1.50% 1.50%(e)
Expenses, before waivers and reimbursements 1.77% 2.05% 1.50% 1.97% 2.15%(e)
Net investment income....................... 6.22% 6.01% 4.85% 5.85% 5.77%(e)
Portfolio turnover rate....................... 262% 102% 125% 78% 25%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the investment adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total investment return calculated
for a period of less than one year is not annualized.
(e) Annualized.
81
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
GROWTH AND INCOME PORTFOLIO
-----------------------------------------------------------------------
JULY 15, 1991(A)
YEAR ENDED DECEMBER 31, TO
-----------------------------------------------------
1995 1994 1993 1992 DECEMBER 31, 1991
-------- -------- -------- -------- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 11.85 $ 12.18 $ 10.99 $ 10.35 $ 10.00
------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)..................... .27(c) .10(c) .01(c) .10(c) .35(c)
Net realized and unrealized gain (loss) on
investments................................. 3.94 (.16) 1.27 .71 -0-
------- ------- ------- ------- -------
Net increase (decrease) in net asset value
Net increase (decrease) in net asset value
from operations............................. 4.21 (.06) 1.28 .81 .35
------- ------- ------- ------- -------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.13) (.10) (.06) (.17) -0-
Distributions from net realized gains (.14) (.17) (.03) -0- -0-
------- ------- ------- ------- -------
Total dividends and distributions............. (.27) (.27) (.09) (.17) -0-
------- ------- ------- ------- -------
Net asset value, end of period................ $ 15.79 $ 11.85 $ 12.18 $ 10.99 $ 10.35
======= ======= ======= ======= =======
TOTAL RETURN
Total investment return based on
net asset value (d)......................... 35.76% (.35)% 11.69% 7.92% 3.50%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $41,993 $41,702 $22,756 $7,803 $1,431
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .79% .90% 1.18% .99% 1.79%(e)
Expenses, before waivers and reimbursements .79% .91% 1.28% 2.09% 9.43%(e)
Net investment income....................... 1.95% 1.71% 1.76% 2.42% 3.59%(e)
Portfolio turnover rate....................... 150% 95% 69% 49% 0%
SHORT-TERM MULTI-MARKET PORTFOLIO
-------------------------------------------------------------
YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
1995 1994 1993 1992 1991
-------- -------- -------- -------- ------
Net asset value, beginning of period $ 9.91 $ 11.07 $ 10.77 $ 10.68 $ 10.03
------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)..................... .82(c) .47(c) .28(c) .63(c) .36
Net realized and unrealized gain (loss) on
investments and foreign currency transactions (.15) (1.16) .43 (.54) .34
------- ------- ------- ------- -------
Net increase (decrease) in net asset value
from operations........................... .67 (.69) .71 .09 .70
------- -------- ------- ------- -------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income -0- (.46) (.41) -0- (.03)
Distributions from net realized gains -0- -0- -0- -0- (.02)
Return of capital............................. -0- (.01) -0- -0- -0-
------- -------- ------- ------- -------
Total dividends and distributions............. -0- (.47) (.41) -0- (.05)
------- -------- ------- ------- -------
Net asset value, end of period................ $ 10.58 $ 9.91 $ 11.07 $ 10.77 $ 10.68
======= ======== ======= ======= =======
TOTAL RETURN
Total investment return based on
net asset value (d)......................... 6.76% (6.51)% 6.62% .84% 7.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $3,152 $20,921 $23,560 $14,841 $5,858
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .94% 1.17% .99% 1.79%
Expenses, before waivers and reimbursements 1.30% .99% 1.24% 1.66% 4.40%
Net investment income....................... 8.22% 6.52% 6.39% 7.18% 7.53%
Portfolio turnover rate....................... 379% 134% 210% 153% 51%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed by the investment adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total investment return calculated
for a period of less than one year is not annualized.
(e) Annualized.
82
<PAGE>
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT/HIGH GRADE SECURITIES PORTFOLIO
------------------------------------------------------------
YEAR ENDED DECEMBER 31, SEPTEMBER 17, 1992(A)
--------------------------------- TO
1995 1994 1993 DECEMBER 31, 1992
------- -------- ----- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................... $ 9.94 $ 10.72 $ 9.89 $10.00
------ ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)............................. .65(c) .28(c) .43(c) .14(c)
Net realized and unrealized gain (loss) on investments 1.25 (.71) .48 (.25)
------ ------- ------- ------
Net increase (decrease) in net asset value from
operations ......................................... 1.90 (.43) .91 (.11)
------ ------- ------- ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................. (.18) (.21) (.08) -0-
Distributions from net realized gains................. -0- (.14) -0- -0-
------ ------- ------- ------
Total dividends and distributions..................... (.18) (.35) (.08) -0-
------ ------- ------- ------
Net asset value, end of period........................ $11.66 $ 9.94 $ 10.72 $ 9.89
====== ======= ======= ======
TOTAL RETURN
Total investment return based on net asset value (d) 19.26% (4.03)% 9.20% (1.10)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $16,947 $5,101 $1,350 $785
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .95% 1.16% .95%(e)
Expenses, before waivers and reimbursements 1.58% 3.73% 5.42% 11.56%(e)
Net investment income............................... 5.96% 5.64% 4.59% 4.82%(e)
Portfolio turnover rate............................... 68% 32% 177% 13%
TOTAL RETURN PORTFOLIO
-------------------------------------------------------
YEAR ENDED DECEMBER 31, DECEMBER 28, 1992(A)
----------------------- TO
1995 1994 1993 DECEMBER 31, 1992
----- ---- ----- -----------------
Net asset value, beginning of period..................... $10.41 $ 10.97 $ 10.01 $10.00
------ ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)............................. .36(c) .15(c) .15(c) .01
Net realized and unrealized gain (loss) on investments 2.10 (.56) .81 -0-
------ ------- ------- ------
Net increase (decrease) in net asset value from
operations 2.46 (.41) .96 .01
------ ------- ------- ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................. (.07) (.09) -0- -0-
Distributions from net realized gains................. -0- (.06) -0- -0-
------ ------- ------- ------
Total dividends and distributions..................... (.07) (.15) -0- -0-
------ ------- ------- ------
Net asset value, end of period........................ $12.80 $ 10.41 $ 10.97 $10.01
====== ======= ======= ======
TOTAL RETURN
Total investment return based on net asset value (d) 23.67% (3.77)% 9.59% .10%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $8,242 $750 $360 $95
Ratio to average net assets of:
Expenses, net of waivers and reimbursements........ .95% .95% 1.20% 0%
Expenses, before waivers and reimbursements........ 4.49% 19.49% 25.96% 0%
Net investment income............................... 3.16% 2.29% 1.45% 2.21%(e)
Portfolio turnover rate............................... 30% 83% 25% 0%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the investment adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment
made at the net asset value at the beginning of the period,
reinvestment of all dividends and distributions at net asset value
during the period, and redemption on the last day of the period. Total
investment return calculated for a period of less than one year is not
annualized.
(e) Annualized.
83
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL PORTFOLIO
-------------------------------------------------------
YEAR ENDED DECEMBER 31, DECEMBER 28, 1992(A)
---------------------------------- TO
1995 1994 1993 DECEMBER 31, 1992
------ ------ ----- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period..................... $12.88 $ 12.16 $ 10.00 $10.00
------ ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)............................. .18(c) .10(c) .03(c) -0-
Net realized and unrealized gain on investments and
foreign currency transactions....................... 1.08 .72(d) 2.13 -0-
------ ----- ------- ------
Net increase in net asset value from operations 1.26 .82 2.16 -0-
------ ------- ------ -----------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................. (.03) (.02) -0- -0-
Distributions from net realized gains................. (.04) (.08) -0- -0-
------ ------- ------- ------
Total dividends and distributions..................... (.07) (.10) -0- -0-
------ ------- ------- ------
Net asset value, end of period........................ $14.07 $ 12.88 $ 12.16 $10.00
====== ======= ======= ======
TOTAL RETURN
Total investment return based on net asset value (e) 9.86% 6.70% 21.60% 0%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) ............ $16,542 $7,276 $688 $79
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ........ .95% .95% 1.20% 0%
Expenses, before waivers and reimbursements ........ 2.99% 7.26% 39.28% 0%
Net investment income............................... 1.41% .90% .26% 2.07%(f)
Portfolio turnover rate............................... 87% 95% 85% 0%
MONEY MARKET PORTFOLIO
----------------------------------------------------------
YEAR ENDED DECEMBER 31, DECEMBER 28, 1992(A)
---------------------------------- TO
1995 1994 1993 DECEMBER 31, 1992
------ ------ ----- -----------------
Net asset value, beginning of period..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)............................. .05 .03 .22 -0-
Net realized and unrealized gain on investments ...... -0- -0- -0- -0-
------- ------- ------ ------
Net increase in net asset value from operations ...... .05 .03 .22 -0-
------ ------- ------ ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................. (.05) (.03) (.22) -0-
Distributions from net realized gains................. -0- -0- -0- -0-
------ ------- ------- ------
Total dividends and distributions..................... (.05) (.03) (.22) -0-
------ ------- ------- ------
Net asset value, end of period........................ $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ======= ======= ======
TOTAL RETURN
Total investment return based on net asset value (e) 4.97% 3.27% 2.25% .02%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) ........... $28,092 $6,899 $102 $30
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ........ .95% .95% 1.16% 0%
Expenses, before waivers and reimbursements ........ 1.07% 4.46% 68.14% 0%
Net investment income............................... 4.85% 3.98% 2.15% 3.05%(f)
Portfolio turnover rate............................... 0% 0% 0% 0%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed by investment adviser.
(c) Based on average shares outstanding.
(d) The amount shown in this caption for a share outstanding throughout the
period may not accord with the change in realized and unrealized gains and
losses in the Portfolio securities for the period because of the timing of
sales and repurchases of Portfolio shares in relation to fluctuating market
values for the Portfolio.
(e) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total investment return calculated
for a period of less than one year is not annualized.
(f) Annualized.
84
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
GLOBAL DOLLAR NORTH AMERICAN
GOVERNMENT PORTFOLIO GOVERNMENT INCOME PORTFOLIO
---------------------------------- -------------------------------------
YEAR ENDED MAY 2, 1994(A) YEAR ENDED MAY 3, 1994(A)
DECEMBER 31, TO DECEMBER 31, TO
1995 DECEMBER 31, 1994 1995 DECEMBER 31, 1994
-------------- ----------------- -------------- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 9.84 $10.00 $ 8.79 $ 10.00
------ ------ ------ --------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b).................... .92(c) .36(c) 1.13(c) .50(c)
Net realized and unrealized gain (loss) on
investments and foreign currency transactions 1.32 (.52) .83 (1.71)
------- ------ ------ ------
Net increase (decrease) in net asset value
from operations............................ 2.24 (.16) 1.96 (1.21)
------- ------ ------ ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income ........ (.13) -0- (.27) -0-
Distributions from net realized gains ....... -0- -0- -0- -0-
------- ------ ------ ------
Total dividends and distributions............ (.13) -0- (.27) -0-
------- ------ ------ ------
Net asset value, end of period .............. $ 11.95 $ 9.84 $10.48 $ 8.79
======= ====== ====== =======
TOTAL RETURN
Total investment return based on
net asset value(d)......................... 22.98% (1.60)% 22.71% (12.10)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $3,778 $1,146 $7,278 $3,848
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .95%(e) .95% .95%(e)
Expenses, before waivers and reimbursements 4.82% 15.00%(e) 2.57% 4.43%(e)
Net investment income...................... 8.65% 6.02%(e) 12.24% 8.49%(e)
Portfolio turnover rate...................... 13% 9% 35% 15%
UTILITY INCOME PORTFOLIO GROWTH PORTFOLIO
-------------------------------- ------------------------------------
YEAR ENDED MAY 10, 1994(A) YEAR ENDED SEPTEMBER 15, 1994(A)
DECEMBER 31, TO DECEMBER 31, TO
1995 DECEMBER 31, 1994 1995 DECEMBER 31, 1994
-------------- ----------------- -------------- -----------------
Net asset value, beginning of period $ 9.96 $10.00 $10.53 $10.00
------ ------ ----- -----
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b).................... .30(c) .28(c) .17(c) .03(c)
Net realized and unrealized gain (loss)
on investments............................. 1.83 (.32) 3.54 .50
------- ------ ------ ------
Net increase (decrease) in net asset value
from operations............................ 2.13 (.04) 3.71 .53
------- ------ ------ ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income ........ (.08) -0- (.01) -0-
Distributions from net realized gains ....... -0- -0- -0- -0-
----- ----- ------- -----
Total dividends and distributions............ (.08) -0- (.01) -0-
----- ------ ------ ------
Net asset value, end of period .............. $12.01 $ 9.96 $14.23 $10.53
====== ====== ====== ======
TOTAL RETURN
Total investment return based on
net asset value(d)......................... 21.45% (.40)% 35.23% 5.30%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $6,251 $1,254 $45,220 $5,492
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .95%(e) .95% .95%(e)
Expenses, before waivers and reimbursements 3.79% 15.98%(e) 1.27% 4.19%(e)
Net investment income...................... 2.73% 4.62%(e) 1.31% 1.17%(e)
Portfolio turnover rate...................... 138% 31% 86% 25%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed by investment adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment made at
the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total investment return calculated
for a period of less than one year is not annualized.
(e) Annualized.
85
<TABLE>
<CAPTION>
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
- ------------------------------------------------------------------------------------------------------------------------
WORLDWIDE PRIVATIZATION PORTFOLIO CONSERVATIVE INVESTORS PORTFOLIO
------------------------------------- ----------------------------------------
YEAR ENDED SEPTEMBER 23, 1994(A) YEAR ENDED OCTOBER 28, 1994(A)
DECEMBER 31, TO DECEMBER 31, TO
1995 DECEMBER 31, 1994 1995 DECEMBER 31, 1994
-------------- --------------------- -------------- -----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $10.10 $10.00 $10.07 $10.00
------ ------ ------ -------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b).................... .32(c) .10(c) .51(c) .06(c)
Net realized and unrealized gain
on investments............................. .78 -0- 1.20 .01
------- ------ ------ ------
Net increase in net asset value
from operations............................ 1.10 .10 1.71 .07
------- ------ ------ ------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income ........ (.03) -0- (.02) -0-
Distributions from net realized gains ........ -0- -0- -0- -0-
--------- -------- ------- -------
Total dividends and distributions............ (.03) -0- (.02) -0-
------- ------ ------ ------
Net asset value, end of period $11.17 $10.10 $11.76 $10.07
======== ======= ======= =======
TOTAL RETURN
Total investment return based on
net asset value(d)......................... 10.87% 1.00% 16.99% 0.70%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $5,947 $1,127 $7,420 $701
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% .95%(e) .95% .95%(e)
Expenses, before waivers and reimbursements 4.17% 18.47%(e) 4.25% 20.35%(e)
Net investment income...................... 2.96% 4.27%(e) 4.65% 3.55%(e)
Portfolio turnover rate...................... 23% 0% 61% 2%
GROWTH INVESTORS PORTFOLIO
-----------------------------------------------
YEAR ENDED OCTOBER 28, 1994(A)
DECEMBER 31, TO
1995 DECEMBER 31, 1994
-------------- ------------------
Net asset value, beginning of period......................... $ 9.86 $10.00
------ ------
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b)................................. .35(c) .04(c)
Net realized and unrealized gain (loss) on investments ... 1.67 (.18)
------ -------
Net increase (decrease) in net asset value from operations 2.02 (.14)
------ -------
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income...................... (.01) -0-
Distributions from net realized gains..................... -0- -0-
------ ------
Total dividends and distributions......................... (.01) -0-
------ ------
Net asset value, end of period............................ $11.87 $ 9.86
====== ======
TOTAL RETURN
Total investment return based on net asset value(d) ...... 20.48% (1.40)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted.................. $4,978 $321
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ............ .95% .95%(e)
Expenses, before waivers and reimbursements ............ 6.17% 41.62%(e)
Net investment income................................... 3.21% 2.29%(e)
Portfolio turnover rate................................... 50% 3%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Commencement of operations.
(b) Net of expenses reimbursed by investment adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment
made at the net asset value at the beginning of the period,
reinvestment of all dividends and distributions at net asset value
during the period, and redemption on the last day of the period. Total
investment return calculated for a period of less than one year is not
annualized.
(e) Annualized.
86
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
- -------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Alliance Variable Products Series Fund, Inc.
(the "Fund"), (comprising, respectively, the Premier Growth, Global Bond, Growth
and Income, Short-Term Multi-Market, U.S. Government/High Grade Securities,
Total Return, International, Money Market, Global Dollar Government, North
American Government Income, Utility Income, Growth, Worldwide Privatization,
Conservative Investors and Growth Investors Portfolios), as of December 31,
1995, and the related statements of operations for the year then ended and the
statements of changes in net assets and the financial highlights for each of the
periods indicated therein. 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 audits 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 as of
December 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, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective Portfolios constituting Alliance Variable Products Series
Fund, Inc. at December 31, 1995, the results of their operations for the year
then ended and the changes in their net assets and the financial highlights for
each of the indicated periods, in conformity with generally accepted accounting
principles.
New York, New York
February 5, 1996
- --------------------------------------------------------------
FEDERAL INCOME TAX INFORMATION (UNAUDITED)
The following Portfolios of the Fund hereby designate the respective amounts per
share as long-term capital gain distributions during the taxable year ended
December 31, 1995:
PER SHARE
---------
Premier Growth $.02
Growth and Income $.05
International $.03
87
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.
- -------------------------------------------
BOARD OF DIRECTORS
JOHN D. CARIFA, Chairman and President
RUTH BLOCK (1)
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
WILLIAM H. FOULK, JR. (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
ROBERT C. WHITE (1)
OFFICERS
KATHLEEN A. CORBET, Senior Vice President
ALFRED L. HARRISON, Senior Vice President
ALAN LEVI, Senior Vice President
WAYNE D. LYSKI, Senior Vice President
DEBRA G. ACKERMAN, Vice President
GREGORY ALLISON, Vice President
STEVEN BEINHACKER, Vice President
MARK H. BREEDON, Vice President
PAUL J. DENOON, Vice President
KELLY L. MORGAN, Vice President
DOUGLAS J. PEEBLES, Vice President
PAMELA F. RICHARDSON, Vice President
PAUL RISSMAN, Vice President
TYLER J. SMITH, Vice President
EDMUND P. BERGAN, JR., Secretary
MARK D. GERSTEN, Treasurer & Chief Financial Officer
LAURA MAH, Controller
CUSTODIAN
STATE STREET BANK AND TRUST COMPANY
225 Franklin Street
Boston, MA 02110
DISTRIBUTOR
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-free 1-(800) 221-5672
- -----------------------------------------------------------------
(1) Member of the Audit Committee.
88
