<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES TWO WORLD TRADE CENTER, NEW
LETTER TO THE SHAREHOLDERS MARCH 31, 1998 YORK, NEW YORK 10048
DEAR SHAREHOLDER:
We are pleased to present the annual report to shareholders of Dean Witter
Global Dividend Growth Securities for the fiscal year ended March 31, 1998. Once
again, the last twelve months were very rewarding to global equity investors.
Although the global equity markets lagged the U.S. market throughout the fiscal
year, we were reminded of the benefits of global diversification. The central
tenet to global investing is to spread investments across different world
markets, both to take advantage of greater perceived opportunities in various
countries as well as to reduce the risk of investing in only one country. This
is particularly important when that country performs poorly. Simply put, when
the U.S. market is strong, as it has been for the last several years, the Fund
is well positioned to take advantage of that strength. Conversely, if the U.S.
market suffers a setback or when other world markets outperform it, the Fund's
global exposure is able to capture that outperformance.
PERFORMANCE AND PORTFOLIO
During this fiscal year the Fund's Class B shares posted a total return of 23.41
percent, compared to returns of 30.22 percent and 27.19 percent for the Morgan
Stanley Capital International World Index (MSCI World Index) and the Lipper
Global Funds Index, respectively. From their inception on July 28, 1997, through
March 31, 1998, the Fund's Class A, C and D shares produced returns of 5.77
percent, 5.26 percent and 5.97 percent, respectively. The performance of the
Fund's four share classes varies because of differences in expenses. The
accompanying chart illustrates the growth of a hypothetical $10,000 investment
in the Fund's Class B shares from inception on June 30, 1993, versus the
performance of a similar hypothetical investment in the issues that comprise the
MSCI World Index and Lipper Global Funds Index.
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS MARCH 31, 1998, CONTINUED
THE UNITED STATES
Because the United States continues to be the Fund's largest target weighting
(approximately 30 percent of net assets), we were able to take advantage of very
strong market performance right here at home. Calendar year 1997 was the third
consecutive year of much higher than average returns for U.S. equities, with the
S&P 500 Index advancing 33.4 percent. This growth was attributable to many
factors, including high corporate profits, a benign interest-rate and inflation
environment, and a strengthening of the U.S. dollar versus foreign currencies.
These factors, among others, enhanced the appeal and demand of U.S. equities by
both domestic and non-U.S. investors alike. Several U.S. stocks were added to
the portfolio over the last 12 months, including GPU, Inc., Crown Cork & Seal
Co. and Fluor Corp. Although equity valuations in the United States are well
above their long-term averages, we are very optimistic about the long-term
prospects for the companies in which the Fund is invested.
JAPAN
The economic environment in the world's two largest economies is becoming
increasingly polarized. While the U.S. economy has enjoyed a period of prolonged
growth with subdued inflation and an astounding rise in stock prices, Japan's
economy is feared to be on the verge of collapsing. The bear market there is now
eight years old, and the Nikkei 225 Index of Japanese stocks is currently more
than 50 percent below its lifetime high set in December 1989, when the prospects
for that market appeared greatest. March 1998 retail sales figures showed
negative growth from last quarter, and household spending is at the lowest level
of disposable income in nearly 30 years. In addition, the results of the latest
Tankan business survey was much worse than was expected, revealing the extreme
pessimism among Japanese consumers and business leaders alike. As a result,
there are pressures building from all directions to implement the kinds of
structural changes necessary to revitalize Japan. Share buybacks, merit-based
pay systems and lower corporate and personal tax rates are among the changes
slowly occurring.
In our opinion, the silver lining on the current overhanging cloud of
unmitigated gloom comes in the form of attractive valuations among some very
high quality Japanese companies. In such a period of extreme pessimism as exists
today in Japan, there are fantastic opportunities to buy some of the world's
greatest companies at significant discounts to their non-Japanese peers. For the
disciplined long-term investor willing to look through the current haze of
uncertainty, there are exciting opportunities. When investor sentiment is so
widely negative, market valuations reflect that
2
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS MARCH 31, 1998, CONTINUED
pessimism and stock prices remain depressed. But as measures to fix Japan's
problems are announced, the clouds will likely dissipate and investors will bid
up stock market prices, thus realizing certain stocks' more appropriate
long-term valuations.
The Fund, with 23 percent of its assets targeted toward Japanese stocks, is
poised to take advantage of this anticipated rise. This allocation represents a
2 percent reduction over the course of the fiscal year. Many of the Japanese
stocks held in the Fund's portfolio are highly geared toward the economies of
Europe and the United States, because they are large exporters of consumer
products such as automobiles and electronic devices. Since international
consumer demand for these products remains strong, the prospects for these
companies are very favorable. Overall, we remain optimistic about the long-term
prospects for the Fund's Japanese holdings.
EUROPE
The Fund continues to be overweighted in the European region, with individual
target market weightings as follows: the United Kingdom (10 percent), Germany (7
percent), France (6.5 percent), Italy (4 percent), the Netherlands (3 percent),
Switzerland (2 percent), Spain and Sweden (each 1.5 percent). In June 1997 the
Fund initiated exposure to the markets of Spain and Sweden, based primarily upon
attractive valuations there, but also against a favorable backdrop of greater
corporate profit growth potential and a benign interest-rate and inflation
environment. This move has proven to be rewarding because those markets rank
among the best performing ones since then.
In late March 1997, the European Commission (EC) released a list of eleven
nations expected to adopt Europe's common currency in January 1999. In all,
Germany, France, Italy, the Netherlands, Luxembourg, Austria, Belgium, Finland,
Ireland, Portugal and Spain will be linked by the Euro, the name given to the
currency. The United Kingdom, Denmark and Sweden have stated that they do not
want to be part of the common currency at this time. On January 1, 1999,
exchange rates among the eleven countries will be frozen and the European
Central Bank will take over some aspects of monetary policy for all member
countries. Together, the eleven nations will account for 19.4 percent of world
economic production, compared with 19.6 for the United States and 7.7 percent
for Japan. The alliance will become the world's top trading economy, with 18.6
percent of all world trade, exceeding the United States (16.6 percent) and Japan
(8.2 percent). Clearly, this will be a significant global event, consolidating a
newly united economic superpower. The strict economic conditions prescribed by
the European Union's Maastricht Treaty in 1991 forced the participating
countries to be more disciplined about inflation and interest rates, levels of
public borrowing and national debt, as
3
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS MARCH 31, 1998, CONTINUED
well as exchange rate stability. The Euro will likely increase efficiency and
reduce currency risks for companies in the member countries, thereby increasing
their competitiveness within the global theater. These factors, among others,
underscore our strategic overweighting of Europe in the Fund. Several new stock
positions were added this reporting period to the Fund's European holdings,
including Edison in Italy; Endesa, Repsol and Banco Popular in Spain; and
Nordbanken, Sandvik and Volvo in Sweden.
THE PACIFIC RIM
Around the Pacific Rim, 1997 will be remembered as possibly one of the worst
financial crises in modern history. The impact that this crisis had on the Fund
was minimal, however, as it has no exposure to emerging markets. The Fund does
have investments in the two developed markets in the region, Hong Kong (5
percent) and Malaysia (1 percent). In June 1997, before the crisis erupted, the
Fund decreased its allocation to Malaysia, based primarily upon the lack of
attractive valuations. The Fund's exposure to Hong Kong was 4 percent throughout
the year, which is low by industry standards. But following declines of 40 to 60
percent in many high-quality stocks there, the Fund increased its target
weighting in Hong Kong to 5 percent in December and established a position in
Henderson Land Development. The Hong Kong dollar's peg to the U.S. dollar held
steady, thus completely protecting the Fund's currency exposure and avoiding the
precipitous declines seen in many other of the region's currencies. Although the
Asian financial crisis may appear to be over, the economic crisis in fact may be
far from over. In addition, without a Japanese economic recovery, the rest of
Asia's problems will be harder to solve and would likely postpone a prompt
economic recovery there.
CANADA AND AUSTRALIA
Our continued exposure to the resource-oriented markets of Australia and Canada
offers the possibility of risk reduction through diversification, as well as
growth potential in economically stable countries. In August 1997, a slight
reallocation of assets between these two countries was implemented as we reduced
the Fund's exposure to Canada from 3 percent to 2.5 percent and increased its
exposure to Australia from 1.5 percent to 2 percent. In order to facilitate this
move, two additional stocks were purchased in Australia: Normandy Mining and
Santos Ltd. The Fund's position in BCE, Inc. (Canada) was liquidated with these
allocation shifts.
4
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS MARCH 31, 1998, CONTINUED
LOOKING AHEAD
We believe that the long-term outlook for the economies and securities of most
of the world's major countries is favorable and that the stocks of
well-established large-capitalization international companies should perform
well over the long term. While we remain confident and fully invested, we will
remain sensitive to any factors that would necessitate changes to the Fund's
country allocations and portfolio holdings.
We appreciate your support of Dean Witter Global Dividend Growth Securities and
look forward to continuing to serve your investment needs in the future.
Very truly yours,
[SIGNATURE]
CHARLES A. FIUMEFREDDO
CHAIRMAN OF THE BOARD
5
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FUND PERFORMANCE MARCH 31, 1998
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
Growth of $10,000 -- Class B
Shares
<S> <C> <C> <C>
($ in Thousands)
Fund MSCI World(4) Lipper(5)
June-1993 $10,000 $10,000 $10,000
March-1994 $ 10,889 $ 10,572 $ 11,667
March-1995 $11,935 $11,364 $11,695
March-1996 $14,175 $13,418 $14,182
March-1997 $15,958 $14,449 $16,862
March-1998 $19,493(3) $18,815 $20,174
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RETURNS. PERFORMANCE FOR CLASS
A, CLASS C, AND CLASS D SHARES WILL VARY FROM THE PERFORMANCE OF CLASS B
SHARES SHOWN ABOVE DUE TO DIFFERENCES IN SALES CHARGES AND EXPENSES.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS*
- ----------------------------------------------------------------------------------------------------
CLASS B** CLASS A+
- ----------------------------------------------- -----------------------------------------------
<S> <C> <C> <C> <C> <C>
1 Year 23.41(1) 18.41(2) From Inception (7/28/97) 5.77(1) 0.22(2)
From Inception (6/30/93) 15.33(1) 15.09(2)
</TABLE>
<TABLE>
<CAPTION>
CLASS C++ CLASS D#
- ----------------------------------------------- -----------------------------------------------
<S> <C> <C> <C> <C> <C>
From Inception (7/28/97) 5.26(1) 4.29(2) From Inception (7/28/97) 5.97(1)
</TABLE>
- ------------------------
(1) Figure shown assumes reinvestment of all distributions and does not reflect
the deduction of any sales charges.
(2) Figure shown assumes reinvestment of all distributions and the deduction of
the maximum applicable sales charge. See the Fund's current prospectus for
complete details on fees and sales charges.
(3) Closing value after the deduction of a 2% CDSC, assuming a complete
redemption on March 31, 1998.
(4) The Morgan Stanley Capital International World Index (MSCI) measures
performance for a diverse range of global stock markets including the US,
Canada, Europe, Australia, New Zealand and the Far East. The Index does not
include any expenses, fees or charges or reinvestment of dividends. The
Index is unmanaged and should not be considered an investment.
(5) The Lipper Global Funds Index is an equally-weighted performance index of
the largest qualifying funds (based on net assets) in the Lipper Global
Funds objective. The Index, which is adjusted for capital gains
distributions, is unmanaged and should not be considered an investment.
There are currently 30 funds represented in this Index.
* For periods of less than one year, the fund quotes its total return on a
non-annualized basis.
** The maximum contingent deferred sales charge (CDSC) for Class B is 5.00%. The
CDSC declines to 0% after six years.
+ The maximum front-end sales charge for Class A is 5.25%.
++ The maximum contingent deferred sales charge for Class C is 1% for shares
redeemed within one year of purchase.
# Class D shares have no sales charge.
6
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS MARCH 31, 1998
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS AND RIGHTS (98.4%)
AUSTRALIA (1.8%)
BANKING
2,100,000 Australia & New Zealand Banking Group, Ltd.......................................... $ 14,034,657
--------------
BUILDING & CONSTRUCTION
5,475,000 Pioneer International Ltd........................................................... 15,759,213
--------------
GOLD
14,000,000 Normandy Mining Ltd................................................................. 15,007,356
--------------
OIL RELATED
3,570,000 Santos Ltd.......................................................................... 13,370,442
--------------
PAPER & FOREST PRODUCTS
3,040,000 Amcor Ltd........................................................................... 13,075,192
--------------
TOTAL AUSTRALIA..................................................................... 71,246,860
--------------
CANADA (2.5%)
BANKING
565,000 Toronto Dominion Bank............................................................... 24,357,566
--------------
NATURAL GAS
1,043,000 TransCanada Pipelines Ltd........................................................... 24,576,183
--------------
OIL RELATED
402,300 Imperial Oil Ltd.................................................................... 22,713,683
510,000 IPL Energy, Inc..................................................................... 22,866,653
--------------
45,580,336
--------------
TOTAL CANADA........................................................................ 94,514,085
--------------
FRANCE (6.9%)
BANKING
122,000 Societe Generale.................................................................... 24,443,367
--------------
BUILDING MATERIALS
153,000 Compagnie de Saint-Gobain........................................................... 25,215,705
265,000 Lafarge S.A......................................................................... 22,565,035
265,000 Lafarge S.A. (Rights) *............................................................. 346,825
--------------
48,127,565
--------------
FINANCIAL SERVICES
233,000 Compagnie Financiere de Paribas (A Shares).......................................... 23,604,944
49,319 Societe Eurafrance S.A.............................................................. 24,456,295
--------------
48,061,239
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
FOODS & BEVERAGES
122,000 Eridania Beghin-Say S.A............................................................. $ 24,443,367
--------------
MULTI-INDUSTRY
52,000 Compagnie Generale d'Industrie et de Participations................................. 23,777,670
--------------
OIL INTEGRATED - INTERNATIONAL
182,000 Elf Aquitaine S.A................................................................... 23,878,494
195,000 Total S.A. (B Shares)............................................................... 23,441,590
--------------
47,320,084
--------------
TELECOMMUNICATIONS
130,000 Alcatel Alsthom..................................................................... 24,428,826
--------------
TELEVISION
192,000 Societe Television Francaise 1...................................................... 23,887,543
--------------
TOTAL FRANCE........................................................................ 264,489,661
--------------
GERMANY (6.9%)
BANKING
273,000 Deutsche Bank Aktiengesellschaft.................................................... 20,547,355
--------------
BUILDING & CONSTRUCTION
650,500 Bilfinger & Berger Bau AG........................................................... 21,110,991
--------------
CHEMICALS
500,000 BASF AG............................................................................. 22,244,158
446,000 Bayer AG............................................................................ 20,408,698
--------------
42,652,856
--------------
ELECTRICAL EQUIPMENT
285,000 Siemens AG.......................................................................... 19,084,271
--------------
MACHINERY - DIVERSIFIED
61,500 MAN AG.............................................................................. 20,491,129
--------------
MULTI-INDUSTRY
58,000 Preussag AG......................................................................... 19,779,857
330,000 RWE AG.............................................................................. 17,760,169
32,500 Viag AG............................................................................. 17,719,602
--------------
55,259,628
--------------
RETAIL - DEPARTMENT STORES
51,500 Karstadt AG......................................................................... 20,111,964
--------------
RETAIL - SPECIALTY
317,000 Douglas Holding AG.................................................................. 11,848,064
--------------
STEEL & IRON
83,000 Thyssen AG.......................................................................... 17,845,359
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS MARCH 31, 1998, CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
TEXTILES - APPAREL
11,540 Hugo Boss AG (Pref.)................................................................ $ 18,163,890
--------------
UTILITIES - ELECTRIC
265,000 Veba AG............................................................................. 18,805,712
--------------
TOTAL GERMANY....................................................................... 265,921,219
--------------
HONG KONG (4.9%)
BANKING
1,075,000 HSBC Holdings PLC................................................................... 32,881,831
--------------
CONGLOMERATES
5,700,000 Swire Pacific Ltd. (Class A)........................................................ 30,161,844
--------------
REAL ESTATE
4,570,000 Cheung Kong (Holdings) Ltd.......................................................... 32,439,792
6,365,000 Henderson Land Development Co., Ltd................................................. 32,284,208
--------------
64,724,000
--------------
TELECOMMUNICATIONS
14,600,000 Hong Kong Telecommunications Ltd.................................................... 30,148,938
--------------
UTILITIES - ELECTRIC
8,925,000 Hong Kong Electric Holdings Ltd..................................................... 30,640,020
--------------
TOTAL HONG KONG..................................................................... 188,556,633
--------------
ITALY (4.1%)
ELECTRIC POWER
3,500,000 Edison SpA.......................................................................... 29,485,314
--------------
FINANCIAL SERVICES
2,075,000 Istituto Mobiliare Italiano SpA..................................................... 33,719,462
--------------
OIL INTEGRATED - INTERNATIONAL
4,530,000 Ente Nazionale Idrocarburi SpA...................................................... 30,888,059
--------------
TELECOMMUNICATIONS
5,380,000 Telecom Italia SpA.................................................................. 32,991,820
--------------
TEXTILES - APPAREL
1,500,000 Benetton Group SpA.................................................................. 31,539,940
--------------
TOTAL ITALY......................................................................... 158,624,595
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
JAPAN (23.1%)
AUTOMOTIVE
1,320,000 Honda Motor Co...................................................................... $ 47,571,139
1,720,000 Toyota Motor Corp................................................................... 45,844,283
--------------
93,415,422
--------------
BREWERS
5,240,000 Kirin Brewery Co., Ltd.............................................................. 46,817,329
--------------
BUILDING MATERIALS
5,861,000 Sekisui House Ltd................................................................... 47,965,238
--------------
COMPUTER SERVICES
2,572,000 NCR Japan Ltd....................................................................... 8,612,598
--------------
ELECTRONICS & ELECTRICAL
6,365,000 Hitachi, Ltd........................................................................ 46,355,207
899,000 Kyocera Corp........................................................................ 47,248,292
2,965,000 Matsushita Electric Industrial Co., Ltd............................................. 47,639,462
5,080,000 Matsushita Electric Works, Ltd...................................................... 49,964,712
4,390,000 NEC Corp............................................................................ 44,166,979
6,300,000 Sharp Corp.......................................................................... 43,043,772
540,000 Sony Corp........................................................................... 45,814,250
610,000 TDK Corp............................................................................ 47,173,211
--------------
371,405,885
--------------
ENTERTAINMENT & LEISURE TIME
555,000 Nintendo Co., Ltd................................................................... 47,920,264
--------------
MACHINERY
17,625,000 Mitsubishi Electric Corp............................................................ 46,315,414
11,550,000 Mitsubishi Heavy Industries, Ltd.................................................... 43,966,139
--------------
90,281,553
--------------
PHARMACEUTICALS
2,169,000 Taisho Pharmaceutical Co., Ltd...................................................... 48,529,319
1,785,000 Takeda Chemical Industries.......................................................... 45,432,465
--------------
93,961,784
--------------
TOBACCO
6,085 Japan Tobacco, Inc.................................................................. 45,503,867
--------------
TRANSPORTATION
3,810,000 Yamato Transport Co., Ltd........................................................... 45,197,087
--------------
TOTAL JAPAN......................................................................... 891,081,027
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS MARCH 31, 1998, CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MALAYSIA (0.9%)
BANKING
9,859,400 AMMB Holdings Berhad................................................................ $ 11,291,039
--------------
BUILDING & CONSTRUCTION
7,962,000 United Engineers Malaysia Berhad.................................................... 9,292,636
--------------
CONGLOMERATES
11,757,000 Sime Darby Berhad................................................................... 13,142,071
--------------
TOTAL MALAYSIA...................................................................... 33,725,746
--------------
NETHERLANDS (2.3%)
BANKING
580,000 ABN-AMRO Holding NV................................................................. 13,387,398
--------------
CHEMICALS
132,000 DSM NV.............................................................................. 13,808,724
--------------
ELECTRICAL EQUIPMENT
160,000 Philips Electronics NV.............................................................. 11,747,205
--------------
INSURANCE
203,000 Fortis Amev NV...................................................................... 11,981,861
--------------
STEEL
280,000 Koninklijke Hoogovens NV............................................................ 13,543,836
--------------
TELECOMMUNICATIONS
260,000 Koninklijke PTT Nederland NV........................................................ 13,474,735
--------------
TRANSPORTATION
304,000 KLM Royal Dutch Air Lines NV........................................................ 12,166,419
--------------
TOTAL NETHERLANDS................................................................... 90,110,178
--------------
SPAIN (1.6%)
BANKING
213,000 Banco Popular Espanol S.A........................................................... 20,695,696
--------------
ELECTRIC
790,000 Endesa S.A.......................................................................... 19,013,389
--------------
OIL RELATED
400,000 Repsol S.A.......................................................................... 20,427,160
--------------
TOTAL SPAIN......................................................................... 60,136,245
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
SWEDEN (1.5%)
AUTOMOBILES
625,000 Volvo AB (B Shares)................................................................. $ 19,856,750
--------------
BANKING
2,920,100 Nordbanken Holding AB............................................................... 19,320,305
--------------
MACHINERY - DIVERSIFIED
650,000 Sandvik AB (B Shares)............................................................... 18,460,146
--------------
TOTAL SWEDEN........................................................................ 57,637,201
--------------
SWITZERLAND (2.1%)
BANKING
77,100 Swiss Bank Corp..................................................................... 27,116,535
--------------
FOODS & BEVERAGES
14,400 Nestle AG........................................................................... 27,524,410
--------------
HEALTH & PERSONAL CARE
14,200 Novartis AG - Bearer................................................................ 25,250,656
--------------
TOTAL SWITZERLAND................................................................... 79,891,601
--------------
UNITED KINGDOM (10.4%)
BANKING
1,250,000 National Westminster Bank PLC....................................................... 22,831,404
1,550,000 Royal Bank of Scotland Group PLC.................................................... 24,037,102
--------------
46,868,506
--------------
BREWERS
1,350,000 Bass PLC............................................................................ 25,831,028
--------------
ENERGY
1,090,000 Energy Group PLC.................................................................... 15,318,807
--------------
FOODS & BEVERAGES
8,000,000 Hillsdown Holdings PLC.............................................................. 23,529,088
--------------
LEISURE
3,860,000 Rank Group PLC...................................................................... 26,011,423
--------------
MULTI-INDUSTRY
2,250,000 Hanson PLC.......................................................................... 13,573,510
--------------
NATURAL GAS
4,650,000 BG PLC.............................................................................. 24,088,906
--------------
RETAIL - MERCHANDISING
2,620,000 Tesco PLC........................................................................... 26,225,909
--------------
STEEL & IRON
10,250,000 British Steel PLC................................................................... 24,322,861
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS MARCH 31, 1998, CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
TELECOMMUNICATIONS
2,170,000 British Telecommunications PLC...................................................... $ 23,570,866
--------------
TOBACCO
2,375,000 B.A.T. Industries PLC............................................................... 24,170,373
--------------
UTILITIES - ELECTRIC
4,235,500 National Grid Group PLC............................................................. 24,985,142
2,495,000 National Power PLC.................................................................. 25,516,694
2,620,000 Scottish Hydro-Electric PLC......................................................... 25,558,221
--------------
76,060,057
--------------
UTILITIES - WATER
1,350,000 Hyder PLC........................................................................... 22,131,213
1,350,000 Hyder PLC (Pref.)................................................................... 2,763,582
1,500,000 Severn Trent PLC.................................................................... 26,307,292
--------------
51,202,087
--------------
TOTAL UNITED KINGDOM................................................................ 400,773,421
--------------
UNITED STATES (29.4%)
AEROSPACE & DEFENSE
394,000 Northrop Grumman Corp............................................................... 42,330,375
--------------
AUTOMOTIVE
873,000 Ford Motor Co....................................................................... 56,581,312
--------------
BANKING
653,000 BankAmerica Corp.................................................................... 53,954,125
1,459,000 KeyCorp............................................................................. 55,168,437
--------------
109,122,562
--------------
CHEMICALS
580,000 Dow Chemical Co..................................................................... 56,405,000
--------------
COMPUTERS
530,000 International Business Machines Corp................................................ 55,053,750
--------------
CONGLOMERATES
590,000 Minnesota Mining & Manufacturing Co................................................. 53,800,625
1,275,000 Tenneco, Inc........................................................................ 54,426,562
--------------
108,227,187
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
CONTAINERS - METAL & GLASS
1,015,000 Crown Cork & Seal Co., Inc.......................................................... 54,302,500
--------------
ENGINEERING & CONSTRUCTION
1,068,000 Fluor Corp.......................................................................... $ 53,133,000
--------------
HEALTH & PERSONAL CARE
530,000 Bristol-Myers Squibb Co............................................................. 55,285,625
--------------
MACHINERY - DIVERSIFIED
905,000 Deere & Co.......................................................................... 56,053,438
--------------
METALS & MINING
820,000 Phelps Dodge Corp................................................................... 52,941,250
--------------
OIL - DOMESTIC
975,000 Ashland, Inc........................................................................ 55,209,375
--------------
OIL INTEGRATED - INTERNATIONAL
640,000 Chevron Corp........................................................................ 51,400,000
--------------
PAPER & FOREST PRODUCTS
1,135,000 International Paper Co.............................................................. 53,132,188
--------------
RETAIL - MERCHANDISING
641,000 Dayton-Hudson Corp.................................................................. 56,408,000
--------------
TELECOMMUNICATIONS
790,000 Sprint Corp......................................................................... 53,473,125
--------------
TIRE & RUBBER GOODS
755,000 Goodyear Tire & Rubber Co........................................................... 57,191,250
--------------
TOBACCO
1,270,000 Philip Morris Companies, Inc........................................................ 52,943,125
--------------
UTILITIES - ELECTRIC
1,255,000 GPU, Inc............................................................................ 55,533,750
--------------
TOTAL UNITED STATES................................................................. 1,134,726,812
--------------
TOTAL COMMON AND PREFERRED STOCKS AND RIGHTS
(IDENTIFIED COST $3,194,036,363).................................................... 3,791,435,284
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS MARCH 31, 1998, CONTINUED
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- --------------------------------------------------------------------------------------------------------------
<C> <S> <C>
SHORT-TERM INVESTMENT (a) (1.2%)
U.S. GOVERNMENT AGENCY
$ 48,500 Federal Home Loan Mortgage Corp. 5.90% due 04/01/98 (AMORTIZED COST $48,500,000)... $ 48,500,000
--------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(IDENTIFIED COST $3,242,536,363) (b).................................................... 99.6 % 3,839,935,284
CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES.......................................... 0.4 14,468,461
------ ---------------
NET ASSETS.............................................................................. 100.0 % $ 3,854,403,745
------ ---------------
------ ---------------
</TABLE>
- ---------------------
* Non-income producing security.
(a) Security was purchased on a discount basis. The interest rate shown has
been adjusted to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes approximates identified
cost. The aggregate gross unrealized appreciation is $790,425,167 and the
aggregate gross unrealized depreciation is $193,026,246, resulting in net
unrealized appreciation of $597,398,921.
FORWARD FOREIGN CURRENCY CONTRACTS OPEN AT MARCH 31, 1998:
<TABLE>
<CAPTION>
UNREALIZED
CONTRACTS TO IN DELIVERY APPRECIATION/
DELIVER EXCHANGE FOR DATE (DEPRECIATION)
- ----------------------------------------------------------------
<S> <C> <C> <C>
ITL 3,139,659,000 $ 1,743,347 04/01/98 $19,681
Y 260,376,633 $ 1,970,013 04/01/98 15,087
ESP 96,684,376 $ 616,099 04/02/98 (314)
ITL 3,587,471,828 $ 1,989,735 04/02/98 20,219
$ 279,661 Y 37,217,342 04/02/98 (231)
L 806,457 $ 1,350,332 04/06/98 2,661
$ 302,632 ITL 550,918,965 04/06/98 (178)
FRF 13,951,523 $ 2,282,831 04/30/98 28,586
FRF 13,808,968 $ 2,258,175 04/30/98 26,964
--------
Net unrealized appreciation............... $112,475
--------
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
SUMMARY OF INVESTMENTS MARCH 31, 1998
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Aerospace & Defense............................................................. $ 42,330,375 1.1 %
Automobiles..................................................................... 19,856,750 0.5
Automotive...................................................................... 149,996,734 3.9
Banking......................................................................... 364,066,817 9.5
Brewers......................................................................... 72,648,357 1.9
Building & Construction......................................................... 46,162,840 1.2
Building Materials.............................................................. 96,092,803 2.5
Chemicals....................................................................... 112,866,580 2.9
Computer Services............................................................... 8,612,598 0.2
Computers....................................................................... 55,053,750 1.4
Conglomerates................................................................... 151,531,102 3.9
Containers - Metal & Glass...................................................... 54,302,500 1.4
Electric........................................................................ 19,013,389 0.5
Electric Power.................................................................. 29,485,314 0.8
Electrical Equipment............................................................ 30,831,476 0.8
Electronics & Electrical........................................................ 371,405,885 9.6
Energy.......................................................................... 15,318,807 0.4
Engineering & Construction...................................................... 53,133,000 1.4
Entertainment & Leisure Time.................................................... 47,920,264 1.2
Financial Services.............................................................. 81,780,701 2.1
Foods & Beverages............................................................... 75,496,865 2.0
Gold............................................................................ 15,007,356 0.4
Health & Personal Care.......................................................... 80,536,281 2.1
Insurance....................................................................... 11,981,861 0.3
Leisure......................................................................... 26,011,423 0.7
Machinery....................................................................... 90,281,553 2.3
Machinery - Diversified......................................................... 95,004,713 2.5
Metals & Mining................................................................. 52,941,250 1.4
Multi-Industry.................................................................. 92,610,808 2.4
Natural Gas..................................................................... 48,665,089 1.3
Oil - Domestic.................................................................. 55,209,375 1.4
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Oil Integrated - International.................................................. $ 129,608,143 3.4 %
Oil Related..................................................................... 79,377,938 2.1
Paper & Forest Products......................................................... 66,207,380 1.7
Pharmaceuticals................................................................. 93,961,784 2.4
Real Estate..................................................................... 64,724,000 1.7
Retail - Department Stores...................................................... 20,111,964 0.5
Retail - Merchandising.......................................................... 82,633,909 2.1
Retail - Specialty.............................................................. 11,848,064 0.3
Steel........................................................................... 13,543,836 0.4
Steel & Iron.................................................................... 42,168,220 1.1
Telecommunications.............................................................. 178,088,310 4.6
Television...................................................................... 23,887,543 0.6
Textiles - Apparel.............................................................. 49,703,830 1.3
Tire & Rubber Goods............................................................. 57,191,250 1.5
Tobacco......................................................................... 122,617,365 3.2
Transportation.................................................................. 57,363,506 1.5
U.S. Government Agency.......................................................... 48,500,000 1.2
Utilities - Electric............................................................ 181,039,539 4.7
Utilities - Water............................................................... 51,202,087 1.3
-------------- -----
$3,839,935,284 99.6 %
-------------- -----
-------------- -----
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Common Stocks................................................................... $3,770,160,987 97.8 %
Preferred Stocks................................................................ 20,927,472 0.6
Rights.......................................................................... 346,825 0.0
Short-Term Investment........................................................... 48,500,000 1.2
-------------- -----
$3,839,935,284 99.6 %
-------------- -----
-------------- -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1998
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value (identified cost $3,242,536,363)........................ $3,839,935,284
Cash........................................................................................ 744,114
Receivable for:
Investments sold........................................................................ 15,210,456
Dividends............................................................................... 9,322,645
Shares of beneficial interest sold...................................................... 3,797,782
Foreign withholding taxes reclaimed..................................................... 3,142,052
Deferred organizational expenses............................................................ 8,995
Prepaid expenses and other assets........................................................... 216,879
--------------
TOTAL ASSETS........................................................................... 3,872,378,207
--------------
LIABILITIES:
Payable for:
Investments purchased................................................................... 9,308,796
Shares of beneficial interest repurchased............................................... 2,785,425
Plan of distribution fee................................................................ 2,625,836
Investment management fee............................................................... 2,352,390
Accrued expenses and other payables......................................................... 902,015
--------------
TOTAL LIABILITIES...................................................................... 17,974,462
--------------
NET ASSETS............................................................................. $3,854,403,745
--------------
--------------
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................................................. $3,106,968,009
Net unrealized appreciation................................................................. 597,116,988
Dividends in excess of net investment income................................................ (2,122,966)
Accumulated undistributed net realized gain................................................. 152,441,714
--------------
NET ASSETS............................................................................. $3,854,403,745
--------------
--------------
CLASS A SHARES:
Net Assets.................................................................................. $13,026,556
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 902,667
NET ASSET VALUE PER SHARE.............................................................. $14.43
--------------
--------------
MAXIMUM OFFERING PRICE PER SHARE,
(NET ASSET VALUE PLUS 5.54% OF NET
ASSET VALUE).......................................................................... $15.23
--------------
--------------
CLASS B SHARES:
Net Assets.................................................................................. $3,811,634,236
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 263,945,527
NET ASSET VALUE PER SHARE.............................................................. $14.44
--------------
--------------
CLASS C SHARES:
Net Assets.................................................................................. $9,711,071
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 673,527
NET ASSET VALUE PER SHARE.............................................................. $14.42
--------------
--------------
CLASS D SHARES:
Net Assets.................................................................................. $20,031,882
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 1,387,379
NET ASSET VALUE PER SHARE.............................................................. $14.44
--------------
--------------
</TABLE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1998*
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $9,477,309 foreign withholding tax)......................................... $ 86,154,948
Interest...................................................................................... 3,415,323
------------
TOTAL INCOME............................................................................. 89,570,271
------------
EXPENSES
Plan of distribution fee (Class A shares)..................................................... 10,822
Plan of distribution fee (Class B shares)..................................................... 28,749,725
Plan of distribution fee (Class C shares)..................................................... 39,547
Investment management fee..................................................................... 25,372,172
Transfer agent fees and expenses.............................................................. 4,059,150
Custodian fees................................................................................ 2,124,835
Registration fees............................................................................. 296,719
Shareholder reports and notices............................................................... 220,150
Professional fees............................................................................. 73,532
Organizational expenses....................................................................... 36,059
Trustees' fees and expenses................................................................... 16,587
Other......................................................................................... 34,039
------------
TOTAL EXPENSES........................................................................... 61,033,337
------------
NET INVESTMENT INCOME.................................................................... 28,536,934
------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments............................................................................... 425,272,841
Foreign exchange transactions............................................................. (633,116)
------------
NET GAIN................................................................................. 424,639,725
------------
Net change in unrealized appreciation/ depreciation on:
Investments............................................................................... 270,129,001
Translation of forward foreign currency contracts, other assets and liabilities
denominated in foreign currencies....................................................... (67,955)
------------
NET APPRECIATION......................................................................... 270,061,046
------------
NET GAIN................................................................................. 694,700,771
------------
NET INCREASE.................................................................................. $723,237,705
------------
------------
</TABLE>
- ---------------------
* Class A, Class C and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MARCH 31, 1998* MARCH 31, 1997
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income...................................................... $ 28,536,934 $ 25,266,634
Net realized gain.......................................................... 424,639,725 255,587,707
Net change in unrealized appreciation...................................... 270,061,046 39,186,358
--------------- --------------
NET INCREASE.......................................................... 723,237,705 320,040,699
--------------- --------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A shares......................................................... (89,450) --
Class B shares......................................................... (30,169,703) (27,883,886)
Class C shares......................................................... (44,631) --
Class D shares......................................................... (173,106) --
Net realized gain
Class A shares......................................................... (565,637) --
Class B shares......................................................... (405,262,485) (201,225,779)
Class C shares......................................................... (502,865) --
Class D shares......................................................... (1,032,962) --
--------------- --------------
TOTAL DIVIDENDS AND DISTRIBUTIONS..................................... (437,840,839) (229,109,665)
--------------- --------------
Net increase from transactions in shares of beneficial interest............ 530,515,791 513,559,240
--------------- --------------
NET INCREASE.......................................................... 815,912,657 604,490,274
NET ASSETS:
Beginning of period........................................................ 3,038,491,088 2,434,000,814
--------------- --------------
END OF PERIOD
(INCLUDING DIVIDENDS IN EXCESS OF NET INVESTMENT INCOME OF $2,122,966
AND ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME OF $15,457,
RESPECTIVELY).......................................................... $ 3,854,403,745 $3,038,491,088
--------------- --------------
--------------- --------------
</TABLE>
- ---------------------
* Class A, Class C and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998
1. ORGANIZATION AND ACCOUNTING POLICIES
Dean Witter Global Dividend Growth Securities (the "Fund") is registered under
the Investment Company Act of 1940, as amended (the "Act"), as a diversified,
open-end management investment company. The Fund's investment objective is to
provide reasonable current income and long-term growth of income and capital.
The Fund seeks to achieve its objective by investing primarily in common stock
of issuers worldwide, with a record of paying dividends and the potential for
increasing dividends. The Fund was organized as a Massachusetts business trust
on January 12, 1993 and commenced operations on June 30, 1993. On July 28, 1997,
the Fund commenced offering three additional classes of shares, with the then
current shares designated as Class B shares.
The Fund offers Class A shares, Class B shares, Class C shares and Class D
shares. The four classes are substantially the same except that most Class A
shares are subject to a sales charge imposed at the time of purchase, some Class
A shares, and most Class B shares and Class C shares are subject to a contingent
deferred sales charge imposed on shares redeemed within one year, six years and
one year, respectively. Class D shares are not subject to a sales charge.
Additionally, Class A shares, Class B shares and Class C shares incur
distribution expenses.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ from
those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York, American, or other domestic or foreign stock exchange is valued at its
latest sale price on that exchange prior to the time when assets are valued; if
there were no sales that day, the security is valued at the latest bid price (in
cases where securities are traded on more than one exchange, the securities are
valued on the exchange designated as the primary market pursuant to procedures
adopted by the Trustees); (2) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (3) when market
quotations are not readily available, including circumstances under which it is
determined by Dean Witter InterCapital Inc. (the "Investment Manager") that sale
and bid prices are not reflective of a security's market value, portfolio
securities are valued at their fair value as determined in good faith under
procedures established by and under the general supervision of the Trustees
(valuation of debt securities for which market quotations are not readily
available may be based upon current market
15
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
prices of securities which are comparable in coupon, rating and maturity or an
appropriate matrix utilizing similar factors); and (4) short-term debt
securities having a maturity date of more than sixty days at time of purchase
are valued on a mark-to-market basis until sixty days prior to maturity and
thereafter at amortized cost based on their value on the 61st day. Short-term
debt securities having a maturity date of sixty days or less at the time of
purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Dividend income and other distributions are recorded on the ex-dividend date
except for certain dividends from foreign securities which are recorded as soon
as the Fund is informed after the ex-dividend date. Discounts are accreted over
the life of the respective securities. Interest income is accrued daily.
C. MULTIPLE CLASS ALLOCATIONS -- Investment income, expenses (other than
distribution fees), and realized and unrealized gains and losses are allocated
to each class of shares based upon the relative net asset value on the date such
items are recognized. Distribution fees are charged directly to the respective
class.
D. FOREIGN CURRENCY TRANSLATION -- The books and records of the Fund are
maintained in U.S. dollars as follows: (1) the foreign currency market value of
investment securities, other assets and liabilities and forward foreign currency
contracts are translated at the exchange rates prevailing at the end of the
period; and (2) purchases, sales, income and expenses are translated at the
exchange rates prevailing on the respective dates of such transactions. The
resultant exchange gains and losses are included in the Statement of Operations
as realized and unrealized gain/loss on foreign exchange transactions. Pursuant
to U.S. Federal income tax regulations, certain foreign exchange gains/losses
included in realized and unrealized gain/loss are included in or are a reduction
of ordinary income for federal income tax purposes. The Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the changes in the market prices of the securities.
E. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward
foreign currency contracts which are valued daily at the appropriate exchange
rates. The resultant unrealized exchange gains and losses are included in the
Statement of Operations as unrealized gain/loss on
16
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
foreign exchange transactions. The Fund records realized gains or losses on
delivery of the currency or at the time the forward contract is extinguished
(compensated) by entering into a closing transaction prior to delivery.
F. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
G. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends
and distributions to its shareholders on the record date. The amount of
dividends and distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations which may
differ from generally accepted accounting principles. These "book/tax"
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are reclassified
within the capital accounts based on their federal tax-basis treatment;
temporary differences do not require reclassification. Dividends and
distributions which exceed net investment income and net realized capital gains
for financial reporting purposes but not for tax purposes are reported as
dividends in excess of net investment income or distributions in excess of net
realized capital gains. To the extent they exceed net investment income and net
realized capital gains for tax purposes, they are reported as distributions of
paid-in-capital.
H. ORGANIZATIONAL EXPENSES -- The Investment Manager paid the organizational
expenses of approximately $180,000 which have been reimbursed for the full
amount thereof. Such expenses have been deferred and are being amortized on the
straight-line method over a period not to exceed five years from the
commencement of operations.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement, the Fund pays the Investment
Manager a management fee, accrued daily and payable monthly, by applying the
following annual rates to the net assets of the Fund determined at the close of
each business day: 0.75% to the portion of daily net assets not exceeding $1
billion; 0.725% to the portion of daily net assets exceeding $1 billion but not
exceeding $1.5 billion; 0.70% to the portion of daily net assets exceeding $1.5
billion but not exceeding $2.5 billion; and 0.675% to the portion of daily net
assets exceeding $2.5 billion. Effective May 1, 1997, the Agreement was amended
to reduce the annual fee to 0.65% of the portion of daily net assets in excess
of $3.5 billion.
17
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities, equipment,
clerical, bookkeeping and certain legal services and pays the salaries of all
personnel, including officers of the Fund who are employees of the Investment
Manager. The Investment Manager also bears the cost of telephone services, heat,
light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted a
Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan
provides that the Fund will pay the Distributor a fee which is accrued daily and
paid monthly at the following annual rates: (i) Class A -- up to 0.25% of the
average daily net assets of Class A; (ii) Class B -- 1.0% of the lesser of: (a)
the average daily aggregate gross sales of the Class B shares since the
inception of the Fund (not including reinvestment of dividend or capital gain
distributions) less the average daily aggregate net asset value of the Class B
shares redeemed since the Fund's inception upon which a contingent deferred
sales charge has been imposed or waived; or (b) the average daily net assets of
Class B; and (iii) Class C -- up to 1.0% of the average daily net assets of
Class C. In the case of Class A shares, amounts paid under the Plan are paid to
the Distributor for services provided. In the case of Class B and Class C
shares, amounts paid under the Plan are paid to the Distributor for services
provided and the expenses borne by it and others in the distribution of the
shares of these Classes, including the payment of commissions for sales of these
Classes and incentive compensation to, and expenses of, the account executives
of Dean Witter Reynolds Inc. ("DWR"), an affiliate of the Investment Manager and
Distributor, and others who engage in or support distribution of the shares or
who service shareholder accounts, including overhead and telephone expenses;
printing and distribution of prospectuses and reports used in connection with
the offering of these shares to other than current shareholders; and
preparation, printing and distribution of sales literature and advertising
materials. In addition, the Distributor may utilize fees paid pursuant to the
Plan, in the case of Class B shares, to compensate DWR and other selected
broker-dealers for their opportunity costs in advancing such amounts, which
compensation would be in the form of a carrying charge on any unreimbursed
expenses.
In the case of Class B shares, provided that the Plan continues in effect, any
cumulative expenses incurred by the Distributor but not yet recovered may be
recovered through the payment of future
18
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
distribution fees from the Fund pursuant to the Plan and contingent deferred
sales charges paid by investors upon redemption of Class B shares. Although
there is no legal obligation for the Fund to pay expenses incurred in excess of
payments made to the Distributor under the Plan and the proceeds of contingent
deferred sales charges paid by investors upon redemption of shares, if for any
reason the Plan is terminated, the Trustees will consider at that time the
manner in which to treat such expenses. The Distributor has advised the Fund
that such excess amounts, including carrying charges, totaled $72,726,630 at
March 31, 1998.
In the case of Class A shares and Class C shares, expenses incurred pursuant to
the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily
net assets of Class A or Class C, respectively, will not be reimbursed by the
Fund through payments in any subsequent year, except that expenses representing
a gross sales credit to account executives may be reimbursed in the subsequent
calendar year. For the period ended March 31, 1998, the distribution fee was
accrued for Class A shares and Class C shares at the annual rate of 0.25% and
1.00%, respectively.
The Distributor has informed the Fund that for the period ended March 31, 1998,
it received contingent deferred sales charges from certain redemptions of the
Fund's Class B and Class C shares of $4,749,932 and $5,208, respectively and
received $183,817 in front-end sales charges from sales of the Fund's Class A
shares. The respective shareholders pay such charges which are not an expense of
the Fund.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the year ended March 31, 1998 aggregated
$1,932,623,169 and $1,785,668,843, respectively.
For the year ended March 31, 1998, the Fund incurred $174,060 in brokerage
commissions with DWR for portfolio transactions executed on behalf of the Fund.
At March 31, 1998, included in the Fund's receivable for investments sold was an
unsettled trade with DWR for $972,031.
For the period May 31, 1997 through March 31, 1998, the Fund incurred brokerage
commissions of $1,211,197 with Morgan Stanley & Co., Inc., an affiliate of the
Investment Manager since May 31, 1997, for portfolio transactions executed on
behalf of the Fund. At March 31, 1998, included in the Fund's payable for
investments purchased and receivable for investments sold were unsettled trades
with Morgan Stanley & Co., Inc. of $1,573,507 and $658,754, respectively.
19
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At March 31, 1998, the Fund had
transfer agent fees and expenses payable of approximately $25,000.
The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Trustees of the Fund who will have served as independent
Trustees for at least five years at the time of retirement. Benefits under this
plan are based on years of service and compensation during the last five years
of service. Aggregate pension costs for the year ended March 31, 1998 included
in Trustees' fees and expenses in the Statement of Operations amounted to
$7,482. At March 31, 1998, the Fund had an accrued pension liability of $30,814
which is included in accrued expenses in the Statement of Assets and
Liabilities.
5. FEDERAL INCOME TAX STATUS
Foreign currency losses incurred after October 31 ("post October losses") within
the taxable year are deemed to arise on the first business day of the Fund's
next taxable year. The Fund incurred and will elect to defer net foreign
currency losses of approximately $90,000 during fiscal 1998.
As of March 31, 1998, the Fund had temporary book/tax differences primarily
attributable to capital loss deferrals on wash sales and income from the
mark-to-market of passive foreign investment companies ("PFICs") and permanent
book/tax differences attributable to foreign currency losses and tax adjustments
on PFICs sold by the Fund. To reflect reclassifications arising from permanent
differences, dividends in excess of net investment income was charged and
accumulated undistributed net realized gain was credited $198,467.
20
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
6. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MARCH 31, 1998 MARCH 31, 1997
---------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- -------------- ----------- ------------
<S> <C> <C> <C> <C>
CLASS A SHARES*
Sold............................................................. 885,238 $ 12,442,665 -- --
Reinvestment of dividends and distributions...................... 47,429 606,606 -- --
Redeemed......................................................... (30,000) (424,056) -- --
----------- -------------- ----------- ------------
Net increase - Class A........................................... 902,667 12,625,215 -- --
----------- -------------- ----------- ------------
CLASS B SHARES
Sold............................................................. 54,063,092 772,136,946 51,442,695 $677,741,563
Reinvestment of dividends and distributions...................... 30,559,475 405,815,115 16,426,517 213,686,419
Redeemed......................................................... (49,060,405) (689,166,941) (28,703,758) (377,868,742)
----------- -------------- ----------- ------------
Net increase - Class B........................................... 35,562,162 488,785,120 39,165,454 513,559,240
----------- -------------- ----------- ------------
CLASS C SHARES*
Sold............................................................. 697,103 9,960,568 -- --
Reinvestment of dividends and distributions...................... 40,593 516,939 -- --
Redeemed......................................................... (64,169) (887,746) -- --
----------- -------------- ----------- ------------
Net increase - Class C........................................... 673,527 9,589,761 -- --
----------- -------------- ----------- ------------
CLASS D SHARES*
Sold............................................................. 1,378,903 19,481,908 -- --
Reinvestment of dividends and distributions...................... 93,459 1,196,710 -- --
Redeemed......................................................... (84,983) (1,162,923) -- --
----------- -------------- ----------- ------------
Net increase - Class D........................................... 1,387,379 19,515,695 -- --
----------- -------------- ----------- ------------
Net increase in Fund............................................. 38,525,735 $ 530,515,791 39,165,454 $513,559,240
----------- -------------- ----------- ------------
----------- -------------- ----------- ------------
</TABLE>
- ---------------------
* For the period July 28, 1997 (issue date) through March 31, 1998.
7. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS
The Fund may enter into forward foreign currency contracts ("forward contracts")
to facilitate settlement of foreign currency denominated portfolio transactions
or to manage foreign currency exposure associated with foreign currency
denominated securities.
21
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS MARCH 31, 1998, CONTINUED
Forward contracts involve elements of market risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The Fund bears the risk of
an unfavorable change in the foreign exchange rates underlying the forward
contracts. Risks may also arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their contracts.
At March 31, 1998, there were outstanding forward contracts used to facilitate
settlement of foreign currency denominated portfolio transactions.
8. OTHER
On January 29, 1998, the Board of Trustees of the Fund and of Dean Witter World
Wide Investment Trust ("World Wide") approved a reorganization plan whereby
World Wide would be merged into the Fund. This plan is subject to the consent of
the World Wide shareholders. If approved, the assets of the Fund would be
combined with the assets of World Wide and shareholders of World Wide would
become shareholders of the Fund, receiving shares of the corresponding class of
the Fund, equal to the value of their holdings in World Wide.
22
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE
PERIOD
JUNE 30,
1993*
FOR THE YEAR ENDED MARCH 31 THROUGH
-------------------------------------------------- MARCH 31,
1998**++ 1997 1996 1995 1994
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS B SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period........... $ 13.30 $ 12.86 $ 11.41 $ 10.81 $ 10.00
---------- --------- --------- ---------- ---------
Net investment income.......................... 0.11 0.12 0.13 0.14 0.05
Net realized and unrealized gain............... 2.79 1.44 1.96 0.88 0.84
---------- --------- --------- ---------- ---------
Total from investment operations............... 2.90 1.56 2.09 1.02 0.89
---------- --------- --------- ---------- ---------
Less dividends and distributions from:
Net investment income....................... (0.12) (0.13) (0.15) (0.14) (0.05)
Net realized gain........................... (1.64) (0.99) (0.49) (0.28) (0.03)
---------- --------- --------- ---------- ---------
Total dividends and distributions.............. (1.76) (1.12) (0.64) (0.42) (0.08)
---------- --------- --------- ---------- ---------
Net asset value, end of period................. $ 14.44 $ 13.30 $ 12.86 $ 11.41 $ 10.81
---------- --------- --------- ---------- ---------
---------- --------- --------- ---------- ---------
TOTAL INVESTMENT RETURN+....................... 23.41% 12.58% 18.77% 9.60% 8.89%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses....................................... 1.71% 1.75% 1.85% 1.97% 2.03%(2)
Net investment income.......................... 0.80% 0.93% 1.05% 1.22% 0.66%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in millions......... $3,812 $3,038 $2,434 $1,854 $1,121
Portfolio turnover rate........................ 51% 40% 40% 32% 21%(1)
Average commission rate paid................... $ 0.0272 $ 0.0289 $ 0.0311 -- --
</TABLE>
- ---------------------
* Commencement of operations.
** Prior to July 28, 1997, the Fund issued one class of shares. All shares of
the Fund held prior to that date have been designated Class B shares.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
23
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
MARCH 31, 1998++
- ----------------------------------------------------------------------------------------
<S> <C>
CLASS A SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.91
------
Net investment income................................................. 0.09
Net realized and unrealized gain...................................... 0.62
------
Total from investment operations...................................... 0.71
------
Less dividends and distributions from:
Net investment income.............................................. (0.16)
Net realized gain.................................................. (1.03)
------
Total dividends and distributions..................................... (1.19)
------
Net asset value, end of period........................................ $ 14.43
------
------
TOTAL INVESTMENT RETURN+.............................................. 5.77%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.17%(2)
Net investment income................................................. 1.02%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $ 13,027
Portfolio turnover rate............................................... 51%
Average commission rate paid.......................................... $ 0.0272
CLASS C SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.91
------
Net investment income................................................. 0.02
Net realized and unrealized gain...................................... 0.62
------
Total from investment operations...................................... 0.64
------
Less dividends and distributions from:
Net investment income.............................................. (0.10)
Net realized gain.................................................. (1.03)
------
Total dividends and distributions..................................... (1.13)
------
Net asset value, end of period........................................ $ 14.42
------
------
TOTAL INVESTMENT RETURN+.............................................. 5.26%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.92%(2)
Net investment income................................................. 0.24%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $ 9,711
Portfolio turnover rate............................................... 51%
Average commission rate paid.......................................... $ 0.0272
</TABLE>
- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
24
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
MARCH 31, 1998++
- ----------------------------------------------------------------------------------------
<S> <C>
CLASS D SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.91
------
Net investment income................................................. 0.11
Net realized and unrealized gain...................................... 0.62
------
Total from investment operations...................................... 0.73
------
Less dividends and distributions from:
Net investment income.............................................. (0.17)
Net realized gain.................................................. (1.03)
------
Total dividends and distributions..................................... (1.20)
------
Net asset value, end of period........................................ $ 14.44
------
------
TOTAL INVESTMENT RETURN+.............................................. 5.97%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 0.92%(2)
Net investment income................................................. 1.21%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $ 20,032
Portfolio turnover rate............................................... 51%
Average commission rate paid.......................................... $ 0.0272
</TABLE>
- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
25
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND TRUSTEES
OF DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Dean Witter Global Dividend Growth
Securities (the "Fund") at March 31, 1998, the results of its operations for the
year then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for each of the periods
presented, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at March
31, 1998 by correspondence with the custodian and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
MAY 8, 1998
26
<PAGE>
DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FEDERAL TAX NOTICE (UNAUDITED)
1998 FEDERAL TAX NOTICE
For the year ended March 31, 1998, the Fund paid to shareholders the following
per share amounts from long-term capital gains. These distributions are taxable
as 28% rate gains or 20% rate gains, as indicated below:
<TABLE>
<CAPTION>
PER SHARE
----------
CLASS A
----------
<S> <C>
Portion of long-term capital gains taxable as:
28% rate gain......................................................................................................... $ 0.14
20% rate gain......................................................................................................... 0.84
-----
Total long-term capital gains........................................................................................... $ 0.98
-----
-----
<CAPTION>
CLASS B
----------
<S> <C>
Portion of long-term capital gains taxable as:
28% rate gain......................................................................................................... $ 0.67
20% rate gain......................................................................................................... 0.84
-----
Total long-term capital gains........................................................................................... $ 1.51
-----
-----
<CAPTION>
CLASS C
----------
Portion of long-term capital gains taxable as:
28% rate gain......................................................................................................... $ 0.14
20% rate gain......................................................................................................... 0.84
-----
Total long-term capital gains........................................................................................... $ 0.98
-----
-----
<CAPTION>
CLASS D
----------
Portion of long-term capital gains taxable as:
28% rate gain......................................................................................................... $ 0.14
20% rate gain......................................................................................................... 0.84
-----
Total long-term capital gains........................................................................................... $ 0.98
-----
-----
</TABLE>
For the year ended March 31, 1998, 32.15% of the income dividends qualified for
the dividends received deduction available to corporations. In addition, the
Fund has elected, pursuant to Section 853 of the Internal Revenue Code, to pass
through foreign taxes of $0.03 per share to its shareholders, of which 100%
would be allowable as a credit. The Fund generated net foreign source income of
$0.10 per share with respect to this election.
27
<PAGE>
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Barry Fink
Vice President, Secretary and General Counsel
Paul D. Vance
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Morgan Stanley Dean Witter Trust FSB
Harborside Financial Center -- Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and
trustees, fees, expenses and other pertinent information, please see the
prospectus of the Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
DEAN WITTER
GLOBAL DIVIDEND
GROWTH SECURITIES
[PHOTO]
ANNUAL REPORT
MARCH 31, 1998
