<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND TWO WORLD TRADE CENTER,
GROWTH SECURITIES NEW YORK, NEW YORK 10048
LETTER TO THE SHAREHOLDERS SEPTEMBER 30, 1998
DEAR SHAREHOLDER:
The six-month period ended September 30, 1998, was marked by unusually strong
volatility in world markets. Following a dramatic and prolonged period of
strength in stock prices globally -- driven by one of the longest economic
expansions since World War II -- the recent downturn has left many investors
wondering whether the markets have peaked. While the factors that drive the
direction of stock prices are constantly changing, the Fund's manager remains
optimistic about the favorable long-term prospects for the high-quality
companies sought out by Global Dividend Growth Securities.
PERFORMANCE REVIEW
For the six-month period under review, Morgan Stanley Dean Witter Global
Dividend Growth Securities performed in line with its peer group. Its Class B
shares returned -13.81 percent, compared with -13.71 percent for the Lipper
Global Fund Index and -10.77 percent for the Morgan Stanley Capital
International World Index. During the same period, the Fund's Class A, C and D
shares posted total returns of -13.50 percent, -13.86 percent and -13.48
percent, respectively. The performance of the Fund's four share classes varies
because each class has different expenses.
Overall, we expect the stocks of high-quality industry leaders, such as those
sought out by the Fund, to be more resilient to market weakness by nature of
their size and strength. This is evidenced by the relative performance of the
Fund since world markets corrected. Consider the record: from the start of the
reporting period March 31, 1998, through July 31, 1998, the Fund (Class B)
experienced a moderate drop of 3.71 percent. In August, a painful month for
equities worldwide, the Fund (Class B) declined 11.86 percent (versus -13.45
percent for the MSCI World Index and -14.56 percent for the Lipper Global Fund
Index). During the highly turbulent period, July 31, 1998 through September 30,
1998, the Fund's (Class B shares) total return was -10.49 percent.
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS SEPTEMBER 30, 1998, CONTINUED
This well tops the return of -14.52 percent for the Lipper Global Fund Index
(its peer group) and -12.04 percent for the MSCI World Index. The Fund's
emphasis on quality and its relatively conservative management style, coupled
with its lack of exposure to emerging markets, boosted performance during this
volatile period.
COUNTRY OVERVIEWS
UNITED STATES
The United States, as the world's largest economy, continues to be the Fund's
largest target weighting (34 percent of net assets). This represents a 4 percent
increase from six months ago. Additions to the portfolio over the period
included Alcoa, Albertson's Inc. and Consolidated Natural Gas.
Ongoing concerns about slowing corporate profits and economic growth, political
uncertainty in Washington, and the Asian contagion have negatively impacted U.S.
equities. We have been extremely fortunate in recent years to have enjoyed
nearly perfect conditions of low but sustainable economic growth and benign
inflation. This environment has led to phenomenal capital appreciation of
financial assets. However, such ideal conditions may not be sustainable, and so
we would expect the long-run gains of equity investments to return to more
normal levels in the years ahead.
JAPAN
Following a modest rally in the Nikkei 225 in June, the Fund's target exposure
to Japan was reduced by 5 percent (to 18 percent of assets) in order to temper
our overweight posture in this market. Assets were redeployed to the United
States and the United Kingdom, whose target allocations were increased by 4
percent (to 34 percent of assets) and 1 percent (to 11 percent of assets),
respectively. Since then, the MSCI Japan Index has declined by 15 percent in
U.S. dollar terms, while the MSCI U.S. and U.K. Indices have declined by 9.1
percent and 11.0 percent, respectively.
Six months ago, we wrote to you about widespread alarm that Japan was on the
verge of economic collapse. While that fear for the world's second largest
economy may be overstated, conditions there have continued to deteriorate. The
September economic report released by the Bank of Japan reported that "prices
are in decline, severe corporate financing conditions are worsening, and the
economy is in its worst recession since World War II." A sustained economic
recovery in Japan is not believed to be possible until the problem of excess
leverage in the corporate sector is addressed.
2
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS SEPTEMBER 30, 1998, CONTINUED
Other negative factors weighing on investor sentiment include rising
bankruptcies, falling domestic retail sales, plummeting business confidence,
stock prices at 12-year lows and the estimated Y100 trillion ($870 billion) in
bad loans by Japanese banks.
On the plus side, the Japanese parliament recently addressed the nation's severe
banking problem by approving a plan to inject Y60 trillion ($500 billion), or 12
percent of GDP, into the banking system. This latest bill is the best hope yet
for easing the credit crunch plaguing Japan and the rest of Asia. This latest
measure, combined with plans for further fiscal stimulus (Y10 trillion, or $75
billion), suggest the Japanese government may be finally getting serious about
addressing the country's deep financial problems.
For the disciplined, long-term investor, extreme investor pessimism about Japan
presents fantastic opportunities to buy some of world's greatest companies at
very attractive prices. On balance, we remain optimistic about the long-term
prospects for the Fund's Japanese holdings.
EUROPE
The Fund liquidated several European portfolio positions prior to the July
market peak, resulting in significant profits. Target country allocations in
Europe were also reduced in July after being overweighted for five years.
Individual market target weightings are as follows: United Kingdom, 11 percent;
France, 6 percent; Germany, 5.5 percent; Switzerland, 3 percent; Italy, 3.5
percent; Sweden, 3 percent; the Netherlands, 3 percent; and Spain, 1.5 percent.
The European Union's new single currency, the euro, will replace 11 national
currencies on January 1, 1999. In all, Germany, France, Italy, the Netherlands,
Luxembourg, Austria, Belgium, Finland, Ireland, Portugal and Spain will be
linked by the euro. The alliance will become the world's top trading economy,
with 18.6 percent of all world trade, exceeding both the United States and
Japan. The 11 EMU countries have agreed to establish a European Central Bank
(ECB), which will have control and responsibility for setting the level of
interest rates, consistent with its primary objective of maintaining price
stability. EMU countries have made significant reforms in an effort to bring
their economies in line with the strict convergence criteria: inflation and
long-term rates within 1 1/2 and 2 percent, respectively, of the three best EU
inflation rates; a budget deficit less than 3 percent of GDP; public debt less
than 60 percent of GDP; and a steady record of exchange rate stability. We
believe adherence to these criteria bodes well for the future of European stock
markets.
3
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS SEPTEMBER 30, 1998, CONTINUED
THE PACIFIC RIM
The Asian crisis, which began more than one year ago, continues to plague
investor sentiment both in the region and around the world. The Fund was not
deeply affected by Asia's woes, however, as it has no exposure to emerging
markets. The Fund did have holdings in Hong Kong (5 percent of assets) and
Malaysia (eliminated in July), both of which had been deemed "developed markets"
by the World Bank.
Shares in a Hong Kong property development company, Sun Hung Kai Properties,
were purchased in late August and have already produced significant gains for
the Fund. These shares still trade at approximately a 30-percent discount to the
underlying estimated value of the company's tangible net assets. The Hong Kong
dollar's peg to the U.S. dollar remains intact, thus completely protecting the
Fund's currency exposure there.
Among signs that suggest the bottom may have been reached in Asia are sharply
lower interest rates. This led currency speculators to retreat and currencies to
stabilize. Recent weakness may help Asian economies by easing fears of a Chinese
yuan devaluation, reducing the dollar denominated debts in local currency terms
and enhancing competitiveness of Asian manufacturers. In the near term, the
risks to Hong Kong's economy from financial market distress may weigh on
investor sentiment, but for the disciplined long-term investor, the values that
exist today provide an excellent buying opportunity.
CANADA AND AUSTRALIA
Our continued exposure to the resource-oriented markets of Australia and Canada
offers the potential for risk reduction through diversification, as well as
growth potential in economically stable countries. In August 1998, assets
committed to Australia were increased slightly, to 2.5 percent, and shares in
the Canadian companies Transcanada Pipeline and Nova Corporation were sold and
replaced by a position in Alcan Aluminium. Commodity prices worldwide are near
historic lows, and the shares of many commodity-related companies are trading at
very attractive levels, which seems to discount a deflationary spiral in these
commodity prices.
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
4
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
LETTER TO THE SHAREHOLDERS SEPTEMBER 30, 1998, CONTINUED
companies should perform well over the long term. While we remain confident and
fully invested, we will be sensitive to any developments that would necessitate
changes to the Fund's country allocations and portfolio holdings.
We appreciate your support of Morgan Stanley 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>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS (96.3%)
AUSTRALIA (2.4%)
BANKING
2,900,000 Australia & New Zealand Banking Group Ltd........................................... $ 15,540,529
--------------
BUILDING MATERIALS
8,000,000 Pioneer International Ltd........................................................... 14,976,360
--------------
CONTAINERS/PACKAGING
4,090,000 Amcor Ltd........................................................................... 14,285,147
--------------
OIL & GAS PRODUCTION
6,200,000 Santos Ltd.......................................................................... 17,207,362
--------------
PRECIOUS METALS
21,000,000 Normandy Mining Ltd................................................................. 17,784,428
--------------
TOTAL AUSTRALIA..................................................................... 79,793,826
--------------
CANADA (2.5%)
ALUMINUM
670,000 Alcan Aluminium Ltd................................................................. 15,838,674
--------------
CANADIAN OIL & GAS
1,180,900 Imperial Oil Ltd.................................................................... 17,993,049
--------------
MISCELLANEOUS
1,165,000 EdperBrascan Corp. (Class A)........................................................ 16,569,939
--------------
NON - U.S. BANKS
580,000 Toronto-Dominion Bank............................................................... 15,455,794
--------------
OIL/GAS TRANSMISSION
409,100 IPL Energy, Inc.*................................................................... 17,135,008
--------------
TOTAL CANADA........................................................................ 82,992,464
--------------
FRANCE (6.0%)
AUTO PARTS - ORIGINAL EQUIPMENT
1,200 Valeo S.A........................................................................... 85,802
--------------
BROADCASTING
10,960 Canal Plus.......................................................................... 2,666,385
100,000 Societe Television Francaise 1...................................................... 17,160,324
--------------
19,826,709
--------------
BUILDING MATERIALS
208,000 Lafarge S.A......................................................................... 18,441,628
--------------
CONTAINERS/PACKAGING
37,000 Compagnie Generale d'Industrie et de Participations................................. 16,203,993
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
DIVERSIFIED MANUFACTURING
120,000 Compagnie de Saint-Gobain........................................................... $ 15,937,651
--------------
ELECTRICAL PRODUCTS
175,000 Alcatel Alsthom..................................................................... 15,578,357
--------------
ELECTRONIC DATA PROCESSING
3,000 Thomson CSF......................................................................... 91,700
--------------
ENGINEERING & CONSTRUCTION
280 Vivendi............................................................................. 55,857
--------------
FARMING/SEEDS/MILLING
89,000 Eridania Beghin-Say S.A............................................................. 16,656,776
--------------
HOTELS/RESORTS
11,900 Accor S.A........................................................................... 2,499,419
--------------
INTEGRATED OIL COMPANIES
143,700 Elf Aquitaine S.A................................................................... 17,749,620
--------------
MULTI-LINE INSURANCE
42,400 AXA................................................................................. 3,888,100
--------------
MULTI-SECTOR COMPANIES
254,100 Compagnie Financiere de Paribas..................................................... 13,717,212
34,600 Societe Eurafrance S.A.............................................................. 16,897,056
--------------
30,614,268
--------------
NON - U.S. BANKS
33,300 Banque Nationale de Paris........................................................... 1,785,746
20,000 Credit Commercial de France......................................................... 1,287,024
125,000 Societe Generale.................................................................... 13,853,387
--------------
16,926,157
--------------
OIL REFINING/MARKETING
146,300 Total S.A. (B Shares)............................................................... 18,463,043
--------------
TELECOMMUNICATIONS
66,400 France Telecom S.A. (ADR)*.......................................................... 3,901,000
--------------
TOTAL FRANCE........................................................................ 196,920,080
--------------
GERMANY (5.0%)
APPAREL
8,625 Hugo Boss AG (Pref.)................................................................ 18,098,022
--------------
CONTAINERS/PACKAGING
22,000 Viag AG............................................................................. 15,141,487
--------------
DIVERSIFIED MANUFACTURING
49,800 MAN AG.............................................................................. 16,062,590
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
ELECTRICAL PRODUCTS
270,900 Siemens AG.......................................................................... $ 14,990,450
--------------
ENGINEERING & CONSTRUCTION
580,600 Bilfinger & Berger Bau AG........................................................... 11,208,225
--------------
MAJOR CHEMICALS
410,000 BASF AG............................................................................. 15,559,352
391,200 Bayer AG............................................................................ 14,798,993
--------------
30,358,345
--------------
MOTOR VEHICLES
2,840 Bayerische Motoren Werke (BMW) AG................................................... 1,830,336
568 Bayerische Motoren Werke (BMW) AG (New)*............................................ 357,554
--------------
2,187,890
--------------
MULTI-SECTOR COMPANIES
320,000 RWE AG.............................................................................. 14,877,698
77,000 Thyssen AG.......................................................................... 13,151,858
293,000 VEBA AG............................................................................. 15,282,374
--------------
43,311,930
--------------
NON - U.S. BANKS
258,000 Deutsche Bank Aktiengesellschaft.................................................... 13,348,561
--------------
TOTAL GERMANY....................................................................... 164,707,500
--------------
HONG KONG (5.2%)
AIRLINES
8,750,000 Swire Pacific Ltd. (Class A)........................................................ 27,553,720
--------------
MULTI-SECTOR COMPANIES
286,000 Hutchison Whampoa, Ltd.............................................................. 1,505,943
--------------
NON - U.S. UTILITIES
23,000 CLP Holdings Ltd.................................................................... 112,202
8,250,000 Hong Kong Electric Holdings Ltd..................................................... 28,374,847
--------------
28,487,049
--------------
PRIVATE ISSUES
14,200,000 Hong Kong Telecommunications Ltd.................................................... 27,947,345
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
REAL ESTATE
6,000,000 Cheung Kong (Holdings) Ltd.......................................................... $ 27,798,929
8,100,000 Henderson Land Development Co., Ltd................................................. 27,702,136
8,000,000 Sun Hung Kai Properties Ltd......................................................... 28,340,969
--------------
83,842,034
--------------
TOTAL HONG KONG..................................................................... 169,336,091
--------------
ITALY (2.7%)
NON - U.S. BANKS
36,000 Banca Commerciale Italiana.......................................................... 216,644
1,640,000 Istituto Mobiliare Italiano SpA..................................................... 21,677,732
--------------
21,894,376
--------------
NON - U.S. UTILITIES
2,600,000 Edison SpA.......................................................................... 19,800,515
--------------
OIL & GAS PRODUCTION
3,750,000 Ente Nazionale Idrocarburi SpA...................................................... 23,010,459
--------------
TELECOMMUNICATIONS
4,625,000 Telecom Italia DiRisp............................................................... 22,139,988
276,000 Telecom Italia SpA.................................................................. 1,903,593
--------------
24,043,581
--------------
TOTAL ITALY......................................................................... 88,748,931
--------------
JAPAN (17.2%)
AIR FREIGHT/DELIVERY SERVICES
3,000,000 Yamato Transport Co., Ltd........................................................... 32,491,767
--------------
ALCOHOLIC BEVERAGES
3,931,000 Kirin Brewery Co., Ltd.............................................................. 31,413,480
--------------
AUTO PARTS - ORIGINAL EQUIPMENT
4,000 Bridgestone Corp.................................................................... 80,498
--------------
CONSUMER ELECTRIC/APPLIANCES
5,250,000 Sharp Corp.......................................................................... 31,234,907
426,000 Sony Corp........................................................................... 29,584,632
--------------
60,819,539
--------------
DIVERSIFIED COMMERCIAL SERVICES
20,000 Secom Co............................................................................ 1,244,054
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
DIVERSIFIED ELECTRONIC PRODUCTS
6,524,000 Hitachi, Ltd........................................................................ $ 28,645,445
705,000 Kyocera Corp........................................................................ 30,748,628
2,200,000 Matsushita Electric Industrial Co., Ltd............................................. 29,864,618
4,350,000 NEC Corp............................................................................ 28,172,338
--------------
117,431,029
--------------
ELECTRICAL PRODUCTS
4,339,000 Matsushita Electric Works, Ltd...................................................... 32,927,501
--------------
ELECTRONIC COMPONENTS
450,000 TDK Corp............................................................................ 30,625,686
--------------
HOME BUILDING
4,000,000 Sekisui House Ltd................................................................... 32,462,495
--------------
INDUSTRIAL MACHINERY/COMPONENTS
9,000,000 Mitsubishi Heavy Industries Ltd..................................................... 30,757,409
--------------
MAJOR PHARMACEUTICALS
1,200,000 Takeda Chemical Industries.......................................................... 32,052,689
--------------
MOTOR VEHICLES
952,000 Honda Motor Co...................................................................... 28,911,818
1,450,000 Toyota Motor Corp................................................................... 32,363,703
--------------
61,275,521
--------------
OTHER PHARMACEUTICALS
1,607,000 Taisho Pharmaceutical Co., Ltd...................................................... 33,751,116
--------------
RECREATIONAL PRODUCTS/TOYS
350,000 Nintendo Co., Ltd................................................................... 32,886,937
--------------
SEMICONDUCTORS
1,000 Rohm Co., Ltd....................................................................... 95,134
--------------
TELECOMMUNICATIONS
117 Nippon Telegraph & Telephone Corp................................................... 851,921
--------------
TOBACCO
4,050 Japan Tobacco, Inc.................................................................. 32,173,436
--------------
TOTAL JAPAN......................................................................... 563,340,212
--------------
NETHERLANDS (2.6%)
AIR FREIGHT/DELIVERY SERVICES
260,000 TNT Post Group NV................................................................... 6,633,358
--------------
AIRLINES
409,000 KLM Royal Dutch Air Lines NV........................................................ 10,326,087
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
BOOKS/MAGAZINE
61,800 VNU NV.............................................................................. $ 2,555,565
--------------
DIVERSIFIED ELECTRONIC PRODUCTS
234,000 Philips Electronics NV.............................................................. 12,624,110
--------------
DIVERSIFIED FINANCIAL SERVICES
2,311 ING Groep NV........................................................................ 104,286
--------------
ENGINEERING
148 Fugro NV............................................................................ 4,665
--------------
FINANCIAL PUBLISHING/SERVICES
12,298 Wolters Kluwer NV................................................................... 2,364,296
--------------
FOOD CHAINS
40,319 Koninklijke Ahold NV................................................................ 1,206,527
--------------
LIFE INSURANCE
47,108 Aegon NV............................................................................ 3,738,293
--------------
MAJOR CHEMICALS
50,600 Akzo Nobel NV....................................................................... 1,801,956
--------------
MOVIES/ENTERTAINMENT
40,000 PolyGram NV......................................................................... 2,279,154
--------------
NON - U.S. BANKS
660,000 ABN-AMRO Holding NV................................................................. 11,260,763
--------------
PRIVATE ISSUES
260,000 Koninklijke PTT Nederland NV........................................................ 8,042,947
--------------
SPECIALTY CHEMICALS
152,000 DSM NV.............................................................................. 12,845,753
--------------
STEEL/IRON ORE
382,500 Koninklijke Hoogovens NV............................................................ 10,734,559
--------------
TOTAL NETHERLANDS................................................................... 86,522,319
--------------
SPAIN (1.5%)
FOOD CHAINS
5,100 Centros Comerciales Pryca S.A....................................................... 106,535
--------------
NON - U.S. BANKS
230,000 Banco Popular Espanol S.A........................................................... 14,527,170
--------------
NON - U.S. UTILITIES
750,000 Endesa S.A.......................................................................... 16,937,192
--------------
OIL REFINING/MARKETING
360,000 Repsol S.A.......................................................................... 15,243,472
--------------
TELECOMMUNICATIONS
49,090 Telefonica S.A...................................................................... 1,794,539
--------------
TOTAL SPAIN......................................................................... 48,608,908
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
SWEDEN (3.0%)
CONSUMER ELECTRIC/APPLIANCES
1,200,000 Electrolux AB (Series B)............................................................ $ 15,728,192
--------------
ENGINEERING & CONSTRUCTION
408,000 Skanska AB (B Shares)............................................................... 13,420,882
--------------
LIFE INSURANCE
293,500 Skandia Forsakrings AB.............................................................. 3,809,505
--------------
MACHINERY - DIVERSIFIED
775,000 Sandvik AB (B Shares)............................................................... 16,173,570
--------------
MAJOR PHARMACEUTICALS
80,000 Astra AB (B Shares)................................................................. 1,313,228
--------------
MOTOR VEHICLES
618,000 Volvo AB (B Shares)................................................................. 15,099,065
--------------
NON - U.S. BANKS
2,600,100 Nordbanken Holding AB............................................................... 14,888,910
--------------
PACKAGE GOODS/COSMETICS
725,000 Svenska Cellulosa AB................................................................ 14,299,803
--------------
REAL ESTATE
373,000 Drott AB (B Shares)*................................................................ 3,037,730
--------------
TELECOMMUNICATION EQUIPMENT
101,000 Ericsson (L.M.) Telephone Co. AB (Series "B" Free).................................. 1,902,144
--------------
TOTAL SWEDEN........................................................................ 99,673,029
--------------
SWITZERLAND (2.5%)
MAJOR PHARMACEUTICALS
2,315 Novartis AG......................................................................... 3,726,503
12,030 Novartis AG - Bearer................................................................ 19,382,394
350 Roche Holdings AG................................................................... 3,783,098
--------------
26,891,995
--------------
NON - U.S. BANKS
8,500 Credit Suisse Group*................................................................ 943,417
75,000 UBS AG.............................................................................. 14,689,880
--------------
15,633,297
--------------
PACKAGED FOODS
10,600 Nestle S.A.......................................................................... 21,176,931
--------------
TOBACCO
13,500 Compagnie Financiere Richemont AG (Series A)........................................ 17,334,059
--------------
TOTAL SWITZERLAND................................................................... 81,036,282
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
UNITED KINGDOM (11.1%)
AEROSPACE
15,984 British Aerospace PLC............................................................... $ 96,910
303,268 Rolls-Royce PLC..................................................................... 1,045,531
--------------
1,142,441
--------------
ALCOHOLIC BEVERAGES
1,825,673 Bass PLC............................................................................ 21,858,810
129,600 Diageo PLC.......................................................................... 1,232,558
--------------
23,091,368
--------------
CLOTHING/SHOE/ACCESSORY CHAINS
3,036,200 Next PLC............................................................................ 21,656,790
--------------
DIVERSIFIED ELECTRONIC PRODUCTS
185,441 General Electric Co. PLC............................................................ 1,354,218
--------------
DIVERSIFIED FINANCIAL SERVICES
1,213,570 Allied Zurich PLC*.................................................................. 12,407,256
--------------
DIVERSIFIED MANUFACTURING
10,000,000 Cookson Group PLC................................................................... 18,511,470
--------------
INTEGRATED OIL COMPANIES
314,073 Shell Transport & Trading Co. PLC................................................... 1,900,203
--------------
LIFE INSURANCE
85,621 Prudential Corp. PLC................................................................ 1,250,527
--------------
MAJOR PHARMACEUTICALS
108,846 Glaxo Wellcome PLC.................................................................. 3,210,899
--------------
MEDIA CONGLOMERATES
4,998,868 Rank Group PLC...................................................................... 19,526,028
--------------
MULTI-LINE INSURANCE
67,077 CGU PLC............................................................................. 1,038,352
144,192 Royal & Sun Alliance Insurance Group PLC............................................ 1,248,895
--------------
2,287,247
--------------
MULTI-SECTOR COMPANIES
3,700,000 Hanson PLC.......................................................................... 23,438,238
251,400 Tomkins PLC......................................................................... 1,178,389
--------------
24,616,627
--------------
NON - U.S. BANKS
117,178 Abbey National PLC.................................................................. 2,017,895
59,632 HSBC Holdings PLC................................................................... 1,116,029
1,357,103 National Westminster Bank PLC....................................................... 18,207,667
1,650,000 Royal Bank of Scotland Group PLC.................................................... 18,774,707
--------------
40,116,298
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
NON - U.S. UTILITIES
3,000,000 National Grid Group PLC............................................................. $ 22,315,662
2,400,000 National Power PLC.................................................................. 21,846,931
2,000,000 Scottish Hydro-Electric PLC......................................................... 22,417,560
--------------
66,580,153
--------------
OTHER METALS/MINERALS
1,900,000 Rio Tinto PLC....................................................................... 22,635,792
--------------
OTHER SPECIALTY STORES
128,000 Kingfisher PLC...................................................................... 1,186,908
--------------
PACKAGE GOODS/COSMETICS
7,000 Reckitt & Colman PLC................................................................ 103,486
--------------
PAPER
11,000,000 Arjo Wiggins Appleton PLC........................................................... 19,054,926
--------------
PRIVATE ISSUES
277,921 British Telecommunications PLC...................................................... 3,742,906
--------------
STEEL/IRON ORE
12,100,000 British Steel PLC................................................................... 21,833,769
--------------
TOBACCO
1,213,570 British American Tobacco PLC*....................................................... 9,032,359
--------------
WATER SUPPLY
1,400,000 Hyder PLC........................................................................... 22,147,530
1,350,000 Hyder PLC (Pref.)*.................................................................. 2,808,564
1,255,000 Severn Trent PLC.................................................................... 24,169,696
--------------
49,125,790
--------------
TOTAL UNITED KINGDOM................................................................ 364,367,461
--------------
UNITED STATES (34.6%)
AEROSPACE
640,000 Northrop Grumman Corp............................................................... 46,720,000
--------------
ALUMINUM
610,000 Aluminum Co. of America............................................................. 43,310,000
--------------
AUTOMOTIVE AFTERMARKET
800,000 Goodyear Tire & Rubber Co........................................................... 41,100,000
--------------
BUILDING MATERIALS CHAINS
86,000 Home Depot, Inc..................................................................... 3,397,000
--------------
CONSTRUCTION/AG EQUIP/TRUCKS
1,350,000 Deere & Co.......................................................................... 40,837,500
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
CONTAINERS/PACKAGING
1,500,000 Crown Cork & Seal Co., Inc.......................................................... $ 40,125,000
--------------
DISCOUNT CHAINS
1,100,000 Dayton Hudson Corp.................................................................. 39,325,000
--------------
DIVERSIFIED FINANCIAL SERVICES
48,500 Travelers Group, Inc.*.............................................................. 1,818,750
--------------
DIVERSIFIED MANUFACTURING
33,000 General Electric Co................................................................. 2,625,562
39,000 Honeywell, Inc...................................................................... 2,498,437
575,000 Minnesota Mining & Manufacturing Co................................................. 42,370,312
44,000 Trinity Industries, Inc............................................................. 1,427,250
--------------
48,921,561
--------------
ELECTRIC UTILITIES: EAST
1,035,000 GPU, Inc............................................................................ 43,987,500
--------------
ELECTRONIC DATA PROCESSING
86,000 COMPAQ Computer Corp................................................................ 2,719,750
2,300 Hewlett-Packard Co.................................................................. 121,756
335,000 International Business Machines Corp................................................ 42,880,000
--------------
45,721,506
--------------
ENGINEERING & CONSTRUCTION
1,025,000 Fluor Corp.......................................................................... 42,089,062
--------------
FINANCE COMPANIES
645,786 Associates First Capital Corp. (Class A)............................................ 42,137,536
47,500 Fannie Mae.......................................................................... 3,051,875
--------------
45,189,411
--------------
FOOD CHAINS
775,000 Albertson's, Inc.................................................................... 41,946,875
--------------
INTEGRATED OIL COMPANIES
1,800 Atlantic Richfield Co............................................................... 127,687
521,800 Chevron Corp........................................................................ 43,863,812
42,200 Exxon Corp.......................................................................... 2,961,913
37,500 Mobil Corp.......................................................................... 2,847,656
47,000 Texaco, Inc......................................................................... 2,946,313
--------------
52,747,381
--------------
MAJOR BANKS
705,000 BankAmerica Corp.................................................................... 42,388,125
52,000 BankBoston Corp..................................................................... 1,716,000
46,000 Chase Manhattan Corp................................................................ 1,989,500
20,000 Citicorp............................................................................ 1,858,750
1,380,000 KeyCorp............................................................................. 39,847,500
--------------
87,799,875
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
MAJOR CHEMICALS
500,000 Dow Chemical Co..................................................................... $ 42,718,750
63,700 Monsanto Co......................................................................... 3,591,088
--------------
46,309,838
--------------
MAJOR PHARMACEUTICALS
71,000 American Home Products Corp......................................................... 3,718,625
420,000 Bristol-Myers Squibb Co............................................................. 43,627,500
36,200 Johnson & Johnson................................................................... 2,832,650
66,000 Warner-Lambert Co................................................................... 4,983,000
--------------
55,161,775
--------------
MAJOR U.S. TELECOMMUNICATIONS
575,000 Sprint Corp......................................................................... 41,400,000
--------------
MID - SIZED BANKS
80,600 First Tennessee National Corp....................................................... 2,196,350
--------------
MILITARY/GOV'T/TECHNICAL
38,000 General Motors Corp. (Class H)...................................................... 1,398,875
--------------
MOTOR VEHICLES
72,800 Chrysler Corp....................................................................... 3,485,300
920,000 Ford Motor Co....................................................................... 43,182,500
--------------
46,667,800
--------------
MOVIES/ENTERTAINMENT
82,200 Walt Disney Co...................................................................... 2,080,688
--------------
MULTI-LINE INSURANCE
36,000 American International Group, Inc................................................... 2,772,000
--------------
MULTI-SECTOR COMPANIES
1,300,000 Tenneco, Inc........................................................................ 42,737,500
--------------
NATURAL GAS - DISTRIBUTION
825,000 Consolidated Natural Gas Co......................................................... 44,962,500
--------------
OIL REFINING/MARKETING
880,000 Ashland, Inc........................................................................ 40,700,000
--------------
OILFIELD SERVICES/EQUIPMENT
1,800 Schlumberger, Ltd................................................................... 90,563
--------------
OTHER METALS/MINERALS
815,000 Phelps Dodge Corp................................................................... 42,532,813
--------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
OTHER SPECIALTY STORES
85,700 Pep Boys-Manny, Moe & Jack.......................................................... $ 1,146,238
--------------
PACKAGED FOODS
35,900 General Mills, Inc.................................................................. 2,513,000
--------------
PAPER
58,000 Bowater, Inc........................................................................ 2,066,250
59,200 Champion International Corp......................................................... 1,853,700
900,000 International Paper Co.............................................................. 41,962,500
--------------
45,882,450
--------------
SAVINGS & LOAN ASSOCIATIONS
2,300 Ahmanson (H.F.) & Co................................................................ 127,650
28,500 Golden West Financial Corp.......................................................... 2,331,656
55,500 Washington Mutual, Inc.............................................................. 1,862,719
--------------
4,322,025
--------------
SEMICONDUCTORS
36,800 Intel Corp.......................................................................... 3,155,600
--------------
SOFT DRINKS
77,700 PepsiCo, Inc........................................................................ 2,287,294
--------------
SPECIALTY STEEL
54,800 Nucor Corp.......................................................................... 2,226,250
--------------
TOBACCO
900,000 Philip Morris Companies, Inc........................................................ 41,456,250
--------------
TOTAL UNITED STATES................................................................. 1,137,036,230
--------------
TOTAL COMMON AND PREFERRED STOCKS
(IDENTIFIED COST $3,184,906,116)................................................... 3,163,083,333
--------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS
- ---------
<C> <S> <C>
SHORT-TERM INVESTMENTS (a) (3.2%)
COMMERCIAL PAPER
FINANCE - DIVERSIFIED
$ 30,000 American Express Credit Corp. 5.25% due 10/05/98..................................... 29,982,500
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES
$ 30,000 Federal Home Loan Mortgage Corp. 5.20% due 10/07/98.................................. $ 29,974,000
43,500 Federal Home Loan Mortgage Corp. 5.45% due 10/01/98.................................. 43,500,000
--------------
TOTAL U.S. GOVERNMENT AGENCIES
(AMORTIZED COST $73,474,000)......................................................... 73,474,000
--------------
TOTAL SHORT-TERM INVESTMENTS
(AMORTIZED COST $103,456,500)........................................................ 103,456,500
--------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(IDENTIFIED COST $3,288,362,616) (B).................................................... 99.5 % 3,266,539,833
CASH AND OTHER ASSETS IN EXCESS OF LIABILITIES.......................................... 0.5 15,246,518
------ ---------------
NET ASSETS.............................................................................. 100.0 % $ 3,281,786,351
------ ---------------
------ ---------------
</TABLE>
- ---------------------
* Non-income producing security.
ADR American Depository Receipt.
(a) Securities were purchased on a discount basis. The interest rates shown
have 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 $327,462,796 and the
aggregate gross unrealized depreciation is $349,285,579, resulting in net
unrealized depreciation of $21,822,783.
FORWARD FOREIGN CURRENCY CONTRACTS OPEN AT SEPTEMBER 30, 1998:
<TABLE>
<CAPTION>
UNREALIZED
CONTRACTS TO IN DELIVERY APPRECIATION
DELIVER EXCHANGE FOR DATE (DEPRECIATION)
- ---------------------------------------------------------
<S> <C> <C> <C>
$ 1,684,040 DEM 2,820,430 10/01/98 $ 6,865
$ 1,420,043 NLG 2,681,183 10/01/98 5,057
$ 5,055,409 CHF 7,016,908 10/01/98 34,840
ITL 2,581,407,474 $ 1,556,101 10/01/98 (9,100)
$ 1,340,066 GBP 788,459 10/01/98 (1,025)
AUD 2,270,881 $ 1,331,213 10/02/98 (18,371)
$ 3,287,267 GBP 1,926,660 10/02/98 (15,221)
JPY 589,375,959 $ 4,309,879 10/02/98 (3,154)
$ 1,749,226 CHF 2,408,159 10/05/98 (2,284)
JPY 162,885,617 $ 1,191,120 10/05/98 (872)
HKD 47,214,676 $ 6,092,767 10/05/98 (629)
AUD 2,776,038 $ 1,657,572 10/06/98 7,773
GBP 1,705,487 $ 2,895,917 10/07/98 (512)
AUD 2,317,686 $ 1,372,070 10/07/98 (5,331)
$ 1,809,160 FRF 10,143,600 10/30/98 4,042
FRF 2,728,417 $ 485,700 10/30/98 (2,014)
------------
Net unrealized appreciation.......... $ 65
------------
------------
</TABLE>
CURRENCY ABBREVIATIONS:
<TABLE>
<S> <C>
AUD Australian Dollar.
GBP British Pound.
NLG Dutch Guilder.
FRF French Franc.
DEM German Deutchemark.
HKD Hong Kong Dollar.
ITL Italian Lira.
JPY Japanese Yen.
CHF Swiss Franc.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
SUMMARY OF INVESTMENTS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Aerospace....................................................................... $ 47,862,441 1.5 %
Air Freight/Delivery Services................................................... 39,125,125 1.2
Airlines........................................................................ 37,879,807 1.2
Alcoholic Beverages............................................................. 54,504,848 1.7
Aluminum........................................................................ 59,148,674 1.8
Apparel......................................................................... 18,098,022 0.6
Auto Parts - Original Equipment................................................. 166,299 --
Automotive Aftermarket.......................................................... 41,100,000 1.3
Banking......................................................................... 15,540,529 0.5
Books/Magazine.................................................................. 2,555,565 0.1
Broadcasting.................................................................... 19,826,709 0.6
Building Materials.............................................................. 33,417,988 1.0
Building Materials Chains....................................................... 3,397,000 0.1
Canadian Oil & Gas.............................................................. 17,993,049 0.5
Clothing/Shoe/Accessory Chains.................................................. 21,656,790 0.7
Commercial Paper................................................................ 29,982,500 0.9
Construction/Ag Equip/Trucks.................................................... 40,837,500 1.2
Consumer Electric/Appliances.................................................... 76,547,731 2.3
Containers/Packaging............................................................ 85,755,628 2.6
Discount Chains................................................................. 39,325,000 1.2
Diversified Commercial Services................................................. 1,244,054 --
Diversified Electronic Products................................................. 131,409,356 4.0
Diversified Financial Services.................................................. 14,330,292 0.4
Diversified Manufacturing....................................................... 99,433,273 3.0
Electric Utilities: East........................................................ 43,987,500 1.3
Electrical Products............................................................. 63,496,307 1.9
Electronic Components........................................................... 30,625,686 0.9
Electronic Data Processing...................................................... 45,813,207 1.4
Engineering..................................................................... 4,665 --
Engineering & Construction...................................................... 66,774,027 2.0
Farming/Seeds/Milling........................................................... 16,656,776 0.5
Finance Companies............................................................... 45,189,411 1.4
Financial Publishing/Services................................................... 2,364,296 0.1
Food Chains..................................................................... 43,259,937 1.3
Home Building................................................................... 32,462,495 1.0
Hotels/Resorts.................................................................. 2,499,419 0.1
Industrial Machinery/Components................................................. 30,757,409 0.9
Integrated Oil Companies........................................................ 72,397,204 2.2
Life Insurance.................................................................. 8,798,326 0.3
Machinery - Diversified......................................................... 16,173,570 0.5
Major Banks..................................................................... 87,799,875 2.7
Major Chemicals................................................................. 78,470,139 2.4
Major Pharmaceuticals........................................................... 118,630,586 3.6
Major U.S. Telecommunications................................................... 41,400,000 1.3
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Media Conglomerates............................................................. $ 19,526,028 0.6 %
Mid - Sized Banks............................................................... 2,196,350 0.1
Military/Gov't/Technical........................................................ 1,398,875 --
Miscellaneous................................................................... 16,569,939 0.5
Motor Vehicles.................................................................. 125,230,276 3.8
Movies/Entertainment............................................................ 4,359,841 0.1
Multi-Line Insurance............................................................ 8,947,347 0.3
Multi-Sector Companies.......................................................... 142,786,269 4.4
Natural Gas - Distribution...................................................... 44,962,500 1.4
Non - U.S. Banks................................................................ 164,051,326 5.0
Non - U.S. Utilities............................................................ 131,804,909 4.0
Oil & Gas Production............................................................ 40,217,821 1.2
Oil Refining/Marketing.......................................................... 74,406,515 2.3
Oil/Gas Transmission............................................................ 17,135,009 0.5
Oilfield Services/Equipment..................................................... 90,563 --
Other Metals/Minerals........................................................... 65,168,604 2.0
Other Pharmaceuticals........................................................... 33,751,116 1.0
Other Specialty Stores.......................................................... 2,333,145 0.1
Package Goods/Cosmetics......................................................... 14,403,289 0.4
Packaged Foods.................................................................. 23,689,931 0.7
Paper........................................................................... 64,937,376 2.0
Precious Metals................................................................. 17,784,428 0.5
Private Issues.................................................................. 39,733,198 1.2
Real Estate..................................................................... 86,879,764 2.6
Recreational Products/Toys...................................................... 32,886,937 1.0
Savings & Loan Associations..................................................... 4,322,025 0.1
Semiconductors.................................................................. 3,250,734 0.1
Soft Drinks..................................................................... 2,287,294 0.1
Specialty Chemicals............................................................. 12,845,753 0.4
Specialty Steel................................................................. 2,226,250 0.1
Steel/Iron Ore.................................................................. 32,568,329 1.0
Telecommunication Equipment..................................................... 1,902,144 0.1
Telecommunications.............................................................. 30,591,040 0.9
Tobacco......................................................................... 99,996,103 3.0
U.S. Government Agencies........................................................ 73,474,000 2.3
Water Supply.................................................................... 49,125,790 1.5
-------------- -----
$3,266,539,833 99.5 %
-------------- -----
-------------- -----
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Common Stocks................................................................... $3,142,176,748 95.7 %
Preferred Stocks................................................................ 20,906,585 0.6
Short-Term Investments.......................................................... 103,456,500 3.2
-------------- -----
$3,266,539,833 99.5 %
-------------- -----
-------------- -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $3,288,362,616).......................................................... $3,266,539,833
Cash........................................................................................ 662,759
Receivable for:
Investments sold........................................................................ 30,064,854
Dividends............................................................................... 9,527,247
Foreign withholding taxes reclaimed..................................................... 2,846,775
Shares of beneficial interest sold...................................................... 1,299,429
Prepaid expenses and other assets........................................................... 337,729
--------------
TOTAL ASSETS........................................................................... 3,311,278,626
--------------
LIABILITIES:
Payable for:
Investments purchased................................................................... 20,651,438
Shares of beneficial interest repurchased............................................... 3,486,061
Plan of distribution fee................................................................ 2,618,942
Investment management fee............................................................... 1,958,163
Accrued expenses and other payables......................................................... 777,671
--------------
TOTAL LIABILITIES...................................................................... 29,492,275
--------------
NET ASSETS............................................................................. $3,281,786,351
--------------
--------------
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................................................. $3,252,705,075
Net unrealized depreciation................................................................. (21,476,855)
Accumulated undistributed net investment income............................................. 1,369,754
Accumulated undistributed net realized gain................................................. 49,188,377
--------------
NET ASSETS............................................................................. $3,281,786,351
--------------
--------------
CLASS A SHARES:
Net Assets.................................................................................. $26,064,558
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 2,235,919
NET ASSET VALUE PER SHARE.............................................................. $11.66
--------------
--------------
MAXIMUM OFFERING PRICE PER SHARE,
(NET ASSET VALUE PLUS 5.54% OF NET ASSET VALUE)...................................... $12.31
--------------
--------------
CLASS B SHARES:
Net Assets.................................................................................. $3,190,925,646
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 273,408,384
NET ASSET VALUE PER SHARE.............................................................. $11.67
--------------
--------------
CLASS C SHARES:
Net Assets.................................................................................. $10,967,709
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 941,594
NET ASSET VALUE PER SHARE.............................................................. $11.65
--------------
--------------
CLASS D SHARES:
Net Assets.................................................................................. $53,828,438
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)................................... 4,615,371
NET ASSET VALUE PER SHARE.............................................................. $11.66
--------------
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $4,809,076 foreign withholding tax)........................................ $ 49,321,697
Interest..................................................................................... 3,839,794
-------------
TOTAL INCOME............................................................................ 53,161,491
-------------
EXPENSES
Plan of distribution fee (Class A shares).................................................... 22,526
Plan of distribution fee (Class B shares).................................................... 15,760,457
Plan of distribution fee (Class C shares).................................................... 56,663
Investment management fee.................................................................... 13,341,607
Transfer agent fees and expenses............................................................. 2,300,650
Custodian fees............................................................................... 1,158,084
Shareholder reports and notices.............................................................. 146,847
Registration fees............................................................................ 59,994
Professional fees............................................................................ 40,562
Trustees' fees and expenses.................................................................. 12,723
Organizational expenses...................................................................... 8,995
Other........................................................................................ 19,681
-------------
TOTAL EXPENSES.......................................................................... 32,928,789
-------------
NET INVESTMENT INCOME................................................................... 20,232,702
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments.............................................................................. 115,157,766
Foreign exchange transactions............................................................ (514,477)
-------------
NET GAIN................................................................................ 114,643,289
-------------
Net change in unrealized appreciation/depreciation on:
Investments.............................................................................. (619,221,704)
Translation of forward foreign currency contracts, other assets and liabilities
denominated in foreign currencies...................................................... 627,861
-------------
NET DEPRECIATION........................................................................ (618,593,843)
-------------
NET LOSS................................................................................ (503,950,554)
-------------
NET DECREASE................................................................................. $(483,717,852)
-------------
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
SEPTEMBER 30, 1998 MARCH 31, 1998*
<S> <C> <C>
- --------------------------------------------------------------------------------------------------------------
<CAPTION>
(UNAUDITED)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income.................................................. $ 20,232,702 $ 28,536,934
Net realized gain...................................................... 114,643,289 424,639,725
Net change in unrealized appreciation.................................. (618,593,843) 270,061,046
------------------- ---------------
NET INCREASE (DECREASE)........................................... (483,717,852) 723,237,705
------------------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A shares..................................................... (181,727) (89,450)
Class B shares..................................................... (16,018,395) (30,169,703)
Class C shares..................................................... (47,843) (44,631)
Class D shares..................................................... (388,690) (173,106)
Net realized gain
Class A shares..................................................... (871,566) (565,637)
Class B shares..................................................... (214,269,649) (405,262,485)
Class C shares..................................................... (665,468) (502,865)
Class D shares..................................................... (1,295,371) (1,032,962)
------------------- ---------------
TOTAL DIVIDENDS AND DISTRIBUTIONS................................. (233,738,709) (437,840,839)
------------------- ---------------
Net increase from transactions in shares of beneficial interest........ 144,839,167 530,515,791
------------------- ---------------
NET INCREASE (DECREASE)........................................... (572,617,394) 815,912,657
NET ASSETS:
Beginning of period.................................................... 3,854,403,745 3,038,491,088
------------------- ---------------
END OF PERIOD
(INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $1,369,754 AND
DIVIDENDS IN EXCESS OF NET INVESTMENT INCOME OF $2,122,966,
RESPECTIVELY)...................................................... $ 3,281,786,351 $ 3,854,403,745
------------------- ---------------
------------------- ---------------
</TABLE>
- ---------------------
* Class A, Class C and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
16
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED)
1. ORGANIZATION AND ACCOUNTING POLICIES
Morgan Stanley Dean Witter Global Dividend Growth Securities (the "Fund"),
formerly Dean Witter Global Dividend Growth Securities, 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 and 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 Morgan Stanley Dean Witter Advisors Inc. (the "Investment
Manager"), formerly Dean Witter InterCapital Inc., 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
17
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
supervision of the Trustees (valuation of debt securities for which market
quotations are not readily available may be based upon current market 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
18
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) 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 were deferred and fully amortized as of June 29,
1998.
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; 0.675% to the portion of daily net
assets exceeding $2.5 billion but not exceeding $3.5 billion; and 0.65% to the
portion of daily net assets exceeding $3.5 billion. Effective May 1, 1998, the
Agreement was amended to reduce the annual fee to 0.625% of the portion of daily
net assets in excess of $4.5 billion.
19
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) 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 Morgan Stanley 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 (1)
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 Morgan Stanley
Dean Witter Financial Advisors and others who engage in or support distribution
of the shares or who service shareholder accounts, including overhead and
telephone expenses; (2) printing and distribution of prospectuses and reports
used in connection with the offering of these shares to other than current
shareholders; and (3) 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 Dean Witter
Reynolds Inc. ("DWR"), an affiliate of the Investment Manager and Distributor,
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
20
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) 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 $65,491,622 at
September 30, 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 Morgan Stanley Dean Witter Financial Advisors or other
selected broker-dealer representatives may be reimbursed in the subsequent
calendar year. For the six months ended September 30, 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 six months ended September
30, 1998, it received contingent deferred sales charges from certain redemptions
of the Fund's Class A, Class B and Class C shares of $32, $2,697,369 and $5,608,
respectively and received $61,331 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 six months ended September 30, 1998 aggregated
$951,705,949 and $1,225,561,662, respectively.
For the six months ended September 30, 1998, the Fund incurred $1,500 in
brokerage commissions with DWR for portfolio transactions executed on behalf of
the Fund.
For the six months ended September 30, 1998, the Fund incurred brokerage
commissions of $872,936 with Morgan Stanley & Co., Inc., an affiliate of the
Investment Manager and Distributor, for portfolio transactions executed on
behalf of the Fund. At September 30, 1998, included in the Fund's receivable for
investments sold were unsettled trades with Morgan Stanley & Co., Inc. for
$12,144,277.
21
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent.
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 six months ended September 30, 1998
included in Trustees' fees and expenses in the Statement of Operations amounted
to $6,046. At September 30, 1998, the Fund had an accrued pension liability of
$55,941 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.
6. 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.
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 September 30, 1998, there were outstanding forward contracts used to
facilitate settlement of foreign currency denominated portfolio transactions.
22
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
7. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED
SEPTEMBER 30, 1998 FOR THE YEAR
---------------------------- ENDED
MARCH 31, 1998*
(UNAUDITED) --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- -------------- ----------- ------------
<S> <C> <C> <C> <C>
CLASS A SHARES
Sold............................................................. 1,359,526 $ 17,543,327 885,238 $ 12,442,665
Reinvestment of dividends and distributions...................... 75,769 999,191 47,429 606,606
Shares issued in connection with the acquisition of Dean Witter
World Wide Investment Trust..................................... 60,400 812,979 -- --
Redeemed......................................................... (162,443) (2,175,407) (30,000) (424,056)
----------- -------------- ----------- ------------
Net increase - Class A........................................... 1,333,252 17,180,090 902,667 12,625,215
----------- -------------- ----------- ------------
CLASS B SHARES
Sold............................................................. 11,600,572 94,426,216 54,063,092 772,136,946
Reinvestment of dividends and distributions...................... 16,063,031 214,412,366 30,559,475 405,815,115
Shares issued in connection with the acquisition of Dean Witter
World Wide Investment Trust..................................... 21,617,480 291,187,456 -- --
Redeemed......................................................... (39,818,226) (517,570,128) (49,060,405) (689,166,941)
----------- -------------- ----------- ------------
Net increase - Class B........................................... 9,462,857 82,455,910 35,562,162 488,785,120
----------- -------------- ----------- ------------
CLASS C SHARES
Sold............................................................. 329,611 4,501,879 697,103 9,960,568
Reinvestment of dividends and distributions...................... 50,188 668,772 40,593 516,939
Shares issued in connection with the acquisition of Dean Witter
World Wide Investment Trust..................................... 5,717 76,889 -- --
Redeemed......................................................... (117,449) (1,537,046) (64,169) (887,746)
----------- -------------- ----------- ------------
Net increase - Class C........................................... 268,067 3,710,494 673,527 9,589,761
----------- -------------- ----------- ------------
CLASS D SHARES
Sold............................................................. 695,085 8,499,821 1,378,903 19,481,908
Reinvestment of dividends and distributions...................... 126,034 1,649,734 93,459 1,196,710
Shares issued in connection with the acquisition of Dean Witter
World Wide Investment Trust..................................... 2,083,617 28,066,326 -- --
Shares issued in connection with the acquisition of Dean Witter
Retirement Series - Global Equity Series........................ 1,324,733 15,658,345 -- --
Redeemed......................................................... (1,001,477) (12,381,553) (84,983) (1,162,923)
----------- -------------- ----------- ------------
Net increase - Class D........................................... 3,227,992 41,492,673 1,387,379 19,515,695
----------- -------------- ----------- ------------
Net increase in Fund............................................. 14,292,168 $ 144,839,167 38,525,735 $530,515,791
----------- -------------- ----------- ------------
----------- -------------- ----------- ------------
</TABLE>
- ---------------------
* For Class A, C and D, for the period July 28, 1997 (issue date) through
March 31, 1998.
23
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1998 (UNAUDITED) CONTINUED
8. ACQUISITION OF DEAN WITTER WORLD WIDE INVESTMENT TRUST AND DEAN WITTER
RETIREMENT SERIES -- GLOBAL EQUITY SERIES
As of the close of business on June 5, 1998, the Fund acquired all the net
assets of Dean Witter World Wide Investment Trust ("World Wide") pursuant to a
plan of reorganization approved by the shareholders of World Wide on May 21,
1998. The acquisition was accomplished by a tax-free exchange of 60,400 Class A
shares of the Fund at a net asset value of $13.46 per share for 45,643 Class A
shares of World Wide; 21,617,480 Class B shares of the Fund at a net asset value
of $13.47 per share for 16,154,443 Class B shares of World Wide; 5,717 Class C
shares of the Fund at a net asset value $13.45 per share for 4,847 Class C
shares of World Wide; and 2,083,617 Class D shares of the Fund at a net asset
value of $13.47 per share for 1,553,200 Class D shares of World Wide. The net
assets of the Fund and World Wide immediately before the acquisition were
3,752,602,041 and 320,143,650, respectively, including unrealized appreciation
of $62,431,972 for World Wide. Immediately after the acquisition, the combined
net assets of the Fund amounted to $4,072,745,691.
As of the close of business on September 11, 1998, the Fund acquired all the net
assets of Dean Witter Retirement Series -- Global Equity Series ("Retirement
Global Equity") pursuant to a plan of reorganization approved by shareholders of
Retirement Global Equity on August 19, 1998. The acquisition was accomplished by
a tax-free exchange of 1,324,733 Class D shares of the Fund at a net asset value
of $11.82 per share for 1,295,148 shares of Retirement Global Equity. The net
assets of the Fund and Retirement Global Equity immediately before the
acquisition were $3,344,782,577 and $15,658,117, respectively, including
unrealized appreciation of $1,415,018 for Retirement Global Equity. Immediately
after the acquisition, the combined net assets of the Fund amounted to
$3,360,440,694.
24
<PAGE>
MORGAN STANLEY 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 SIX
MONTHS ENDED FOR THE PERIOD
SEPTEMBER 30, FOR THE YEAR ENDED MARCH 31 JUNE 30, 1993*
1998++ ------------------------------- THROUGH
(UNAUDITED) 1998++** 1997 1996 1995 MARCH 31, 1994
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period......................... $ 14.44 $13.30 $12.86 $11.41 $10.81 $10.00
------ ------ ------ ------ ------ ------
Net investment income........... 0.07 0.11 0.12 0.13 0.14 0.05
Net realized and unrealized gain
(loss)......................... (1.95) 2.79 1.44 1.96 0.88 0.84
------ ------ ------ ------ ------ ------
Total from investment
operations..................... (1.88) 2.90 1.56 2.09 1.02 0.89
------ ------ ------ ------ ------ ------
Less dividends and distributions
from:
Net investment income........ (0.06) (0.12) (0.13) (0.15) (0.14) (0.05)
Net realized gain............ (0.83) (1.64) (0.99) (0.49) (0.28) (0.03)
------ ------ ------ ------ ------ ------
Total dividends and
distributions.................. (0.89) (1.76) (1.12) (0.64) (0.42) (0.08)
------ ------ ------ ------ ------ ------
Net asset value, end of
period......................... $ 11.67 $14.44 $13.30 $12.86 $11.41 $10.81
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN+........ (13.81)%(1) 23.41% 12.58% 18.77% 9.60% 8.89%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses........................ 1.75 %(2)(3) 1.71% 1.75% 1.85% 1.97% 2.03%(2)
Net investment income........... 1.06 %(2)(3) 0.80% 0.93% 1.05% 1.22% 0.66%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
millions....................... $3,191 $3,812 $3,038 $2,434 $1,854 $1,121
Portfolio turnover rate......... 27%(1) 51% 40% 40% 32% 21%(1)
</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.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
25
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE PERIOD
SEPTEMBER 30, JULY 28, 1997*
1998++ THROUGH
(UNAUDITED) MARCH 31, 1998++
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CLASS A SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.43 $ 14.91
------ ------
Net investment income................................................. 0.10 0.09
Net realized and unrealized gain (loss)............................... (1.93) 0.62
------ ------
Total from investment operations...................................... (1.83) 0.71
------ ------
Less dividends and distributions from:
Net investment income.............................................. (0.11) (0.16)
Net realized gain.................................................. (0.83) (1.03)
------ ------
Total dividends and distributions..................................... (0.94) (1.19)
------ ------
Net asset value, end of period........................................ $ 11.66 $ 14.43
------ ------
------ ------
TOTAL INVESTMENT RETURN+.............................................. (13.50)%(1) 5.77%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.15 %(2)(3) 1.17%(2)
Net investment income................................................. 1.66 %(2)(3) 1.02%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $26,065 $13,027
Portfolio turnover rate............................................... 27%(1) 51%(1)
CLASS C SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.42 $ 14.91
------ ------
Net investment income................................................. 0.06 0.02
Net realized and unrealized gain (loss)............................... (1.95) 0.62
------ ------
Total from investment operations...................................... (1.89) 0.64
------ ------
Less dividends and distributions from:
Net investment income.............................................. (0.05) (0.10)
Net realized gain.................................................. (0.83) (1.03)
------ ------
Total dividends and distributions..................................... (0.88) (1.13)
------ ------
Net asset value, end of period........................................ $ 11.65 $ 14.42
------ ------
------ ------
TOTAL INVESTMENT RETURN+.............................................. (13.86)%(1) 5.26%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.90 %(2)(3) 1.92%(2)
Net investment income................................................. 0.91 %(2)(3) 0.24%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $10,968 $9,711
Portfolio turnover rate............................................... 27%(1) 51%(1)
</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.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
26
<PAGE>
MORGAN STANLEY DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE PERIOD
SEPTEMBER 30, JULY 28, 1997*
1998++ THROUGH
(UNAUDITED) MARCH 31, 1998++
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CLASS D SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 14.44 $ 14.91
------ ------
Net investment income................................................. 0.12 0.11
Net realized and unrealized gain (loss)............................... (1.95) 0.62
------ ------
Total from investment operations...................................... (1.83) 0.73
------ ------
Less dividends and distributions from:
Net investment income.............................................. (0.12) (0.17)
Net realized gain.................................................. (0.83) (1.03)
------ ------
Total dividends and distributions..................................... (0.95) (1.20)
------ ------
Net asset value, end of period........................................ $11.66 $14.44
------ ------
------ ------
TOTAL INVESTMENT RETURN+.............................................. (13.48)%(1) 5.97%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 0.90 %(2)(3) 0.92%(2)
Net investment income................................................. 1.91 %(2)(3) 1.21%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $53,828 $20,032
Portfolio turnover rate............................................... 27%(1) 51%(1)
</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.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
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
Matthew Haynes
Assistant 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
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Morgan Stanley Dean Witter Advisors Inc.
Two World Trade Center
New York, New York 10048
The financial statements included herein have been taken from the records of
the Fund without examination by the independent accountants and accordingly
they do not express an opinion thereon.
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.
Morgan Stanley Dean Witter
Global Dividend Growth Securities
Semiannual Report
September 30, 1998
