The Eaton Vance Growth Trust
For the Greater China Growth Portfolio
[LOGO]
Semi-Annual Shareholder Report
February 29, 1996
Portfolio Investment Adviser
Lloyd George Investment Management (Bermuda) Limited
3808 One Exchange Square
Central, Hong Kong
Fund Administrator
Eaton Vance Management
24 Federal Street
Boston, MA 02110
Principal Underwriter
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
89 South Street
P.O. Box 1537
Boston, MA 02205-1537
Transfer Agent
First Data Investor Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
<TABLE>
<CAPTION>
Greater China Growth Portfolio
Portfolio of Investments
February 29, 1996
(Unaudited)
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STOCKS - 98.1%
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Name of Company Shares Value
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<S> <C> <C>
China -- 1.2%
Shanghai New Asia Group Ltd. 400,000 $243,200
Shanghai Tyre and Rubber 2,602,170 629,725
Shanghai Yaohua Pilkington 4,770,500 4,770,500
Shenzhen China Bicycle Co. 8,394,860 1,411,603
------------
$7,055,028
------------
Hong Kong -- 42.0%
Chen Hsong Holdings 10,820,000 $6,157,945
Cheung Kong Holdings Ltd. 3,950,000 27,461,956
China-HK Photo Products Hld. 5,758,000 3,370,126
China Merchants Hai Hong Holdings 8,000,000 2,716,284
China Resources Enterprises 4,966,000 2,842,339
China Travel International 10,322,000 2,283,052
CIM Company Ltd. 1,800,000 3,026,717
Cosco Pacific Ltd. 6,610,000 5,258,144
Founder Hong Kong Ltd. 1,000,000 468,882
Giordano Holdings Ltd. 3,204,000 3,166,494
Guangnan Holdings Ltd. 8,780,000 4,485,879
Hang Seng Bank 760,000 7,471,075
Hong Kong Electric Co. 1,429,500 4,844,415
Hong Kong Land Holdings Ltd. 3,020,000 6,553,400
Hong Kong Telecommunications Ltd. 2,773,000 5,433,985
HSBC Holdings PLC 1,720,000 27,587,099
Hutchison Whampoa 4,400,000 27,887,184
Jardine Matheson Holdings 590,800 4,726,400
Li & Fung Ltd. 7,184,000 6,783,363
National Mutual Ltd. 14,694,000 14,254,671
New World Development 4,000,000 19,505,507
New World Infrastructure 7,497 16,146
Ng Fung Hung Ltd. 9,000,000 4,569,178
CP Pokphand Co. Ltd. 22,586,000 12,431,909
San Miguel Brewery Ltd. 3,170,000 1,568,363
Shanghai Petrochemical 17,218,000 5,734,768
Siu Fung Ceramics Holdings 28,284,000 4,536,474
Sun Hung Kai Properties Ltd. 1,427,000 12,735,880
Tingyi (Cayman Island) Holding Co. 12,800,000 3,518,235
Varitronix International Ltd. 3,782,000 7,288,929
VTECH Holdings Ltd. 2,496,000 4,197,047
Wharf Holdings 941,200 3,646,150
Yizheng Chemical Fibre Co. 3,716,000 1,033,404
Zhenhai Refining & Chemical Co. 3,158,000 898,650
------------
$248,460,050
------------
Indonesia -- 1.8%
PT HM Sampoerna (Foreign) 521,000 $6,235,554
PT Indah Kiat Pulp & Paper 6 5
PT Telecomunikasion 2,752,500 4,395,597
------------
$10,631,156
------------
Republic of Korea -- 7.3%
Hansol Paperboard Co. Ltd. 8 $ 128
Korea Electric Power Corp. 301,200 12,706,327
Korea Exchange Bank 999,499 15,005,319
Pohang Iron & Steel Co. Ltd. 52,630 4,033,464
Samsung Electronics (New) 8,363 1,378,657
Samsung Electronics (Ord) 29,138 4,803,389
Samsung Electronics 620 102,322
Samsung Fire & Marine Insurance 4,030 2,792,718
Samsung Fire & Marine Insurance Pfd. 3,920 2,107,348
------------
$42,929,672
------------
Malaysia -- 8.0%
Berjaya Sports Toto Bhd 1,200,000 $ 3,317,387
DCB Holdings Bhd 1,316,000 3,999,294
Land & General Bhd 3,780,500 8,449,867
Genting Bhd 704,000 6,294,095
Hong Leong Industries Bhd 737,000 3,756,960
Malayan Banking Bhd 400,000 3,654,615
Malaysian Airline System Bhd 300,000 999,922
RJ Reynolds Bhd 1,000,000 2,529,213
Sime Darby Bhd 3,800,000 10,207,043
Tan Chong Motor Holdings Bhd 2,854,000 3,984,095
------------
$47,192,491
------------
The Philippines -- 4.7%
Bacnotan Consolidated Industries 544,290 $2,247,500
Belle Corp. 40,391,000 5,636,672
Philippine Long Distance Telephone 166,700 9,856,137
Pilipino Telephone 7,200,000 8,396,100
San Miguel Corp. Class B 21,090 77,006
SM Prime Holdings 5,831,900 1,716,904
------------
$27,930,319
------------
Singapore -- 13.9%
Cerebos Pacific Ltd. 1,129,000 $9,831,292
City Developments 877,000 7,140,177
Clipsal Industries Holdings Ltd. 2,400,000 5,112,000
Clipsal Industries Warrants 234,000 140,400
DBS Land 980,000 3,850,619
Development Bank of Singapore 470,000 6,688,142
Far East Levingston 500,000 2,973,451
Fraser & Neave Ltd. 150,000 2,007,080
Hotel Properties 1,400,000 2,537,345
Jurong Shipyards 500,000 3,168,142
Overseas Union Bank 1,916,000 13,971,540
Sembawang Maritime 2,199,000 6,849,982
Singapore Airlines Ltd. 925,000 9,299,115
Straits Steamship Land 2,452,500 8,403,611
Straits Steamship Land Warrants 613,125 347,257
------------
$82,320,153
------------
Taiwan -- 4.1%
China Steel 7,935,000 $5,829,042
China Trust Commercial Bank 1,216,000 1,804,233
CIS Technology Inc. 1,640,000 2,576,478
Formosa Chemical 1,477,538 1,241,222
Formosa Plastics 876,900 1,278,773
Grand Pacific Petrochemical 740,000 874,609
Nan Ya Plastic 3,419,799 5,036,798
Taiwan Glass Industrial Corp. 919,000 1,838,134
Taiwan Semiconductor 723,600 2,039,385
Yang Ming Marine Transport 1,500,000 1,532,839
------------
$24,051,513
------------
Thailand -- 14.6%
Bangkok Bank Co. Ltd. 291,200 $3,787,967
Dhana Siam Finance 185,000 1,049,177
Dhana Siam Finance (Foreign) 611,300 3,951,691
Electricity Generating (Foreign) 4,465,870 17,711,164
Finance One Ltd. 581,600 4,267,143
Krung Thai Bank Ltd. (Foreign) 1,298,000 6,125,798
Nava Finance & Securities 1,552,000 4,708,626
Saha Union Corp. Ltd. (Local) 1,555,300 2,158,854
Siam Cement (Local) 201,410 9,856,829
Siam Cement (Foreign) 91,820 4,777,626
Siam Commercial Bank 1,426,600 23,309,903
Thailand Military Bank (Foreign) 967,000 4,985,524
------------
$86,690,302
------------
United States -- 0.5%
AES China Generating Co. Ltd. 210,000 $1,837,500
Pacific Basin Bulk Shipping 84,500 1,003,438
Pacific Basin Bulk Shipping (Warrants) 84,500 68,657
------------
$2,909,595
------------
Total Common Stocks (Identified cost, $474,087,738) $580,170,279
Other Assets - 1.9% 11,529,739
------------
Net Assets - 100.0% $591,700,018
============
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Financial Statements
Statement of Assets and Liabilities
February 29, 1996 (Unaudited)
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Assets:
Investments, at value (Note 1A) (Identified cost, $474,087,738) $580,170,279
Cash 6,129,775
Cash denominated in foreign currencies (cost, $5,647,604) 5,450,971
Dividends and interest receivable 730,229
Deferred organization expenses (Note 1C) 48,951
------------
Total assets $592,530,205
Liabilities:
Payable for investments purchased $797,855
Payable to affiliate --
Trustees' fees 1,250
Accrued expenses 31,082
------------
Total liabilities 830,187
------------
Net Assets applicable to investors' interest in Portfolio $591,700,018
============
Sources of Net Assets:
Net proceeds from capital contributions and withdrawals $485,817,888
Net unrealized appreciation of investments
(computed on the basis of identified cost) 106,082,541
Net unrealized depreciation of foreign currencies (200,411)
------------
Total $591,700,018
============
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Financial Statements (continued)
Statement of Operations
For the Six Months Ended February 29, 1996 (Unaudited)
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Investment Income:
Income --
Dividends (net of foreign taxes of $570,674) $4,814,767
Interest 71,088
-----------
Total income $4,885,855
Expenses --
Investment adviser fee (Note 2) $2,128,304
Administration fee (Note 2) 709,434
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 8,750
Custodian fee (Note 2) 457,991
Legal & audit fees 41,647
Amortization of organization expenses (Note 1C) 14,280
Miscellaneous 4,063
-----------
Total expenses $3,364,469
Deduct --
Reduction of custodian fee (Note 2) 284,288
-----------
Net expenses 3,080,181
-----------
Net investment income $1,805,674
-----------
Realized and Unrealized Gain (Loss) on Investments:
Net realized gain (loss) --
Investment transactions (net of foreign
capital gains taxes of $584,679) $1,945,533
Foreign currency (798,360)
-----------
Net realized gain $1,147,173
Change in unrealized appreciation --
Investments (identified cost basis) $48,377,417
Foreign currency 555,988
-----------
Increase in unrealized appreciation 48,933,405
-----------
Net realized and unrealized gain on investments $50,080,578
-----------
Net increase in net assets from operations $51,886,252
===========
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Financial Statements (continued)
Statements of Changes in Net Assets
- ---------------------------------------------------------------------------------------------
Six Months Ended
February 29, 1996 Year Ended
(Unaudited) August 31, 1995
--------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets:
From operations --
Net investment income $1,805,674 $8,672,881
Net realized gain (loss) on investment transactions 1,147,173 (29,095,245)
Change in unrealized appreciation
of investments and foreign currency 48,933,405 (40,394,548)
------------ ------------
Increase (decrease) in net assets from operations $ 51,886,252 $(60,816,912)
------------ ------------
Capital transactions:
Contributions $61,061,582 $129,870,307
Withdrawals (111,664,874) (211,249,014)
------------ ------------
Decrease in net assets resulting from capital transactions ($50,603,292) $(81,378,707)
------------ ------------
Total increase (decrease) in net assets $1,282,960 $(142,195,619)
Net Assets:
At beginning of period 590,417,058 732,612,677
------------ ------------
At end of period $591,700,018 $590,417,058
============ ============
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Financial Statements (continued)
Supplementary Data
- --------------------------------------------------------------------------------------------------------
Six months ended Year Ended August 31,
February 29, 1996 -------------------------------
(Unaudited) 1995 1994 1993*
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Ratios (As a percentage of average net assets):
Expenses 1.18%+ 1.10% 1.15% 1.38%+
Net investment income 0.63%+ 1.35% 0.73% 0.38%+
Portfolio Turnover 22% 32% 36% 18%
Average Commission Rate Paid ** 0.59%
Net Assets, end of period (000 omitted) $591,700 $590,417 $732,613 $208,043
+ Computed on an annualized basis.
* For the period from the start of business, October 28, 1992, to August 31, 1993.
** Average commission rate paid is computed by dividing the total dollar amount of commissions paid
during the fiscal year by thetotal number of shares purchased and sold during the fiscal year for
which commissions were charged. Amount is computed on a non-annualized basis.
See notes to financial statements
</TABLE>
Notes to Financial Statements (Unaudited)
1) Significant Accounting Policies
Greater China Growth Portfolio (the "Portfolio") is registered under the
Investment Company Act of 1940 as a diversified, open-end investment
company which was organized as a trust under the laws of the State of
New York on September 1, 1992. The Declaration of Trust permits the
Trustees to issue interests in the Portfolio. The following is a summary
of the significant accounting policies of the Portfolio. The policies
are in conformity with generally accepted accounting principles.
A. Investment Valuations - Marketable securities, including options,
that are listed on foreign or U.S. securities exchanges or in the NASDAQ
National Market System are valued at closing sale prices, on the
exchange where such securities are principally traded. Futures positions
on securities or currencies are generally valued at closing settlement
prices. Unlisted or listed securities for which closing sale prices are
not available are valued at the mean between the latest bid and asked
prices. Short-term debt securities with a remaining maturity of 60 days
or less are valued at amortized cost. Other fixed income and debt
securities, including listed securities and securities for which price
quotations are available, will normally be valued on the basis of
valuations furnished by a pricing service. Investments for which
valuations or market quotations are unavailable are valued at fair value
using methods determined in good faith by or at the direction of the
Trustees.
B. Federal Taxes - The Portfolio has elected to be treated as a
partnership for Federal tax purposes. No provision is made by the
Portfolio for federal or state taxes on any taxable income of the
Portfolio because each investor in the Portfolio is individually
responsible for the payment of any taxes on its share of such income.
Since some of the Portfolio's investors are regulated investment
companies that invest all or substantially all of their assets in the
Portfolio, the Portfolio normally must satisfy the applicable source of
income and diversification requirements, (under the Internal Revenue
Code), in order for its investors to satisfy them. The Portfolio will
allocate, at least annually among its investors, each investor's
distributive share of the Portfolio's net investment income, net
realized capital gains, and any other items of income, gain, loss,
deduction or credit. Withholding taxes on foreign dividends and capital
gains have been provided for in accordance with the Trust's
understanding of the applicable countries' tax rules and rates.
C. Deferred Organization Expenses - Costs incurred by the Portfolio in
connection with its organization, including registration costs, are
being amortized on the straight-line basis over five years.
D. Futures Contracts - Upon the entering of a financial futures
contract, the Portfolio is required to deposit ("initial margin") either
in cash or securities an amount equal to a certain percentage of the
purchase price indicated in the financial futures contract. Subsequent
payments are made or received by the Portfolio ("margin maintenance")
each day, dependent on daily fluctuations in the value of the underlying
security, and are recorded for book purposes as unrealized gains or
losses by the Portfolio. The Portfolio's investment in financial futures
contracts is designed only to hedge against anticipated future changes
in interest or currency exchange rates. Should interest or currency
exchange rates move unexpectedly, the Portfolio may not achieve the
anticipated benefits of the financial futures contracts and may realize
a loss. If the Portfolio enters into a closing transaction, the
Portfolio will realize, for book purposes, a gain or loss equal to the
difference between the value of the financial futures contract to sell
and financial futures contract to buy.
E. Foreign Currency Translation - Investment valuations, other assets,
and liabilities initially expressed in foreign currencies are converted
each business day into U.S. dollars based upon current exchange rates.
Purchases and sales of foreign investment securities and income and
expenses are converted into U.S. dollars based upon currency exchange
rates prevailing on the respective dates of such transactions.
Recognized gains or losses on investment transactions attributable to
foreign currency rates are recorded for financial statement purposes as
net realized gains and losses on investments. That portion of unrealized
gains and losses on investments that result from fluctuations
in foreign currency exchange rates are not separately disclosed.
F. Forward Foreign Currency Exchange Contracts - The Portfolio may enter
into forward foreign currency exchange contracts for the purchase or
sale of a specific foreign currency at a fixed price on a future date.
Risks may arise upon entering these contracts from the potential
inability of counterparties to meet the terms of their contracts and
from movements in the value of a foreign currency relative to the U.S.
dollar. The Portfolio will enter into forward contracts for hedging
purposes as well as non-hedging purposes. The forward foreign currency
exchange contracts are adjusted by the daily exchange rate of the
underlying currency and any gains or losses are recorded for financial
statement purposes as unrealized until such time as the contracts have
been closed or offset.
G. Other - Investment transactions are accounted for on the date the
investments are purchased or sold. Dividend income is recorded on the
ex-dividend date. However, if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as the Portfolio is
informed of the ex-dividend date. Interest income is recorded on the
accrual basis.
H. Interim Financial Information - The interim financial statements
relating to February 29, 1996 and for the six month period then ended
have not been audited by independent certified public accountants, but
in the opinion of the Fund's management, reflect all adjustments,
consisting only of normal recurring adjustments, necessary for the fair
presentation of the financial statements.
(2) Investment Adviser Fee and Other Transactions with Affiliates
The investment adviser fee is earned by Lloyd George Management (Hong
Kong) Limited (the Adviser), an affiliate of Eaton Vance, as
compensation for management and investment advisory services rendered to
the Portfolio. Under the advisory agreement, the Adviser receives a
monthly fee of 0.0625% (0.75% annually) of the average daily net assets
of the Portfolio up to $500,000,000, and at reduced rates as daily net
assets exceed that level. For the six months ended February 29, 1996 the
adviser fee was .74% of average net assets. In addition, an
administrative fee is earned by Eaton Vance Management (EVM) for
managing and administering the business affairs of the Portfolio. Under
the administration agreement, EVM earns a monthly fee in the amount of
1/48th of 1% (equal to 0.25% annually) of the average daily net assets
of the Portfolio up to $500,000,000, and at reduced rates as daily net
assets exceed that level. For the six months ended February 29, 1996,
the administration fee was .24% of average net assets. Except as to
Trustees of the Portfolio who are not members of the Adviser or EVM's
organization, officers and Trustees receive remuneration for their
services to the Portfolio out of such investment adviser and
administrative fees. Investors Bank & Trust Company (IBT), serves as
custodian of the Portfolio. Prior to November 10, 1995 IBT was an
affiliate of EVM. Pursuant to the custodian agreement, IBT receives a
fee reduced by credits which are determined based on the average daily
cash balances the Portfolio maintains with IBT. All significant credits
are reported as a reduction of expenses in the Statement of Operations.
Certain of the officers and Trustees of the Portfolio are officers or
directors/trustees of the above organizations.
(3) Investment Transactions
Purchases and sales of investments, other than short-term obligations,
aggregated $121,938,578 and $157,909,687, respectively.
(4) Federal Income Tax Basis of Investments
The cost and unrealized appreciation (depreciation) in value of the
investments owned at February 29, 1996, as computed on a federal income
tax basis, are as follows:
Aggregate cost $474,087,738
============
Gross unrealized appreciation $136,308,232
Gross unrealized depreciation 30,225,691
------------
Net unrealized appreciation $106,082,541
============
(5) Risks Associated with Foreign Investments
Investing in securities issued by companies whose principal business
activities are outside the United States may involve significant risks
not present in domestic investments. For example, there is generally
less publicly available information about foreign companies,
particularly those not subject to the disclosure and reporting
requirements of the U.S. securities laws. Foreign issuers are generally
not bound by uniform accounting, auditing, and financial reporting
requirements and standards of practice comparable to those applicable to
domestic issuers. Investments in foreign securities also involve the
risk of possible adverse changes in investment or exchange control
regulations, expropriation or confiscatory taxation, limitation on the
removal of funds or other assets of the Portfolio, political or
financial instability or diplomatic and other developments which could
affect such investments. Foreign stock markets, while growing in volume
and sophistication, are generally not as developed as those in the
United States, and securities of some foreign issuers (particularly
those located in developing countries) may be less liquid and more
volatile than securities of comparable U.S. companies. In general, there
is less overall governmental supervision and regulation of foreign
securities markets, broker-dealers, and issuers than in the United
States.
(6) Financial Instruments
The Portfolio regularly trades in financial instruments with off-balance
sheet risk in the normal course of its investing activities to assist in
managing exposure to various market risks. These financial instruments
include written options, forward foreign currency exchange contracts and
financial futures contracts and may involve, to a varying degree,
elements of risk in excess of the amounts recognized for financial
statement purposes. The notional or contractual amounts of these
instruments represent the investment the Portfolio has in particular
classes of financial instruments and does not necessarily represent the
amounts potentially subject to risk. The measurement of the risks
associated with these instruments is meaningful only when all related
and offsetting transactions are considered.
(7) Line of Credit
The Portfolio participates with other portfolios and funds managed by
EVM and its affiliates in a $120 million unsecured line of credit
agreement with a bank. The line of credit consists of a $20 million
committed facility and a $100 million discretionary facility. Borrowings
will be made by the Portfolio solely to facilitate the handling of
unusual and/or unanticipated short-term cash requirements. Interest is
charged to each portfolio based on its borrowings at an amount above
either the bank's adjusted certificate of deposit rate, a variable
adjusted certificate of deposit rate, or a federal funds effective rate.
In addition, a fee computed at an annual rate of 1/4 of 1% on the $20
million committed facility and on the daily unused portion of the $100
million discretionary facility is allocated among the participating
funds and portfolios at the end of each quarter. The Portfolio did not
have any significant borrowings or allocated fees.
INVESTMENT MANAGEMENT
OFFICERS
HON. ROBERT LLOYD GEORGE
President, Trustee and Co-Portfolio Manager
JAMES B. HAWKES
Vice President, Trustee
SCOBIE DICKINSON WARD
Vice President, Assistant Secretary,
Assistant Treasurer and Co-Portfolio
Manager
WILLIAM WALTER RALEIGH KERR
Vice President, Secretary and
Assistant Treasurer
JAMES L. O'CONNOR
Vice President and Treasurer
THOMAS OTIS
Vice President and Assistant Secretary
INDEPENDENT TRUSTEES
SAMUEL L. HAYES, III
Jacob H. Schiff Professor of
Investment Banking, Harvard
University Graduate School of
Business Administration
STUART HAMILTON LECKIE
Managing Director and Actuary,
Wyatt Company, Hong Kong
HON. EDWARD K.Y. CHEN
Professor and Director, Center for
Asian Studies, University of
Hong Kong
