Keyport Variable Investment Trust
Colonial-Keyport Growth and Income Fund
Colonial-Keyport Utilities Fund
Colonial-Keyport U.S. Government Fund
Colonial-Keyport International Fund for Growth
Colonial-Keyport Strategic Income Fund
Colonial-Keyport U.S. Fund for Growth
Newport-Keyport Tiger Fund
Semi-Annual Report
June 30, 1995
<PAGE>
TABLE OF CONTENTS
President's Letter 1
Portfolio Manager's Discussion:
Colonial-Keyport Growth and Income Fund 2
Colonial-Keyport Utilities Fund 3
Colonial-Keyport U.S. Government Fund 4
Colonial-Keyport International Fund for Growth 5
Colonial-Keyport Strategic Income Fund 6
Colonial-Keyport U.S. Fund for Growth 7
Newport-Keyport Tiger Fund 8
Financial Statements:
Colonial-Keyport Growth and Income Fund 12
Colonial-Keyport Utilities Fund 17
Colonial-Keyport U.S. Government Fund 21
Colonial-Keyport International Fund for Growth 28
Colonial-Keyport Strategic Income Fund 32
Colonial-Keyport U.S. Fund for Growth 38
Newport-Keyport Tiger Fund 42
Notes to Financial Statements 44
<PAGE>
PRESIDENT'S LETTER
Keyport Variable Investment Trust
Dear Fellow Contract Owner:
We are pleased to report to you on the activities of the Keyport Variable
Investment Trust for the period ended June 30, 1995. This was a period of
substantial growth for the Trust, as net assets increased to approximately $214
million. We are also pleased to report for the first time on the activities of
one new addition to the Trust, the Newport-Keyport Tiger Fund.
The Portfolio Managers' discussions, which follow this letter, review the
investment operations of each Fund and the factors that materially affected its
performance in the first half of 1995. For comparable performance information at
the contract level, please contact your life insurance company.
We have seen many of our Contract Owners allocate monies to more than one
of the Funds to diversify their contract value. As a result, we continue to
present the financial reports in a single, consolidated document. We hope you
find this helpful and convenient.
Thank you for investing in the Keyport Variable Investment Trust.
Sincerely,
/s/ Richard R. Christensen
Richard R. Christensen
President
Keyport Variable Investment Trust
1
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund
Dear Contract Owner:
Colonial-Keyport Growth & Income Fund seeks to provide investors primarily
with income and long-term capital growth and, secondarily, preservation of
capital. The Fund's main investment focus is on U.S. common stocks, but it has
taken advantage of the ability to invest in both foreign stocks and fixed-income
securities issued by the U.S. government and its agencies. This diversified
strategy is designed to give the Fund the flexibility to adjust to changing
economic conditions.
Fund Performance (through June 30, 1995)
Inception Date 7/1/93
6-month total return, assuming reinvestment
of all distributions 16.25%
Average annual total return since
inception, assuming reinvestment of all
distributions 10.07%
Net asset value on 12/31/94 $10.03
Net asset value on 6/30/95 $11.66
Economic/Market Overview
Colonial investors have benefited from favorable conditions in the stock
market over the past six months. While investors were concerned about inflation
in the United States through much of 1994, it now appears that the Federal
Reserve Board's monetary policy has reduced growth and kept inflation under
control. As a result, the performance of U.S. stocks has continued to improve,
despite a decline in the value of the dollar. In fact, in recent months the
United States had one of the world's strongest stock markets. In contrast to
the U.S., Japan's economy has been slowing, reflecting negative pressures from
the unexpected strength of the yen and the impact of the Kobe earthquake.
However, many other foreign markets, including those of Western Europe, have
improved.
Investment Strategy
The Fund invests in a diverse selection of securities spread over many
sectors and countries. We believe this strategy will provide more consistent
results over time than a strategy that makes large bets in individual countries
or sectors.
Outlook
Colonial management believes that the current period of economic expansion in
the United States may have peaked. However, the economy and stock market should
continue to grow in the months ahead, although at a more subdued pace. It is
management's view that continued stock market improvement reflects a consistent
level of confidence among U.S. equity investors.
Dan Rie, lead portfolio manager
Colonial-Keyport Growth & Income Fund
Performance of a Hypothetical $10,000 Investment July 1, 1993 to June 30, 1995
----------------------------------------------------
Average Annual Total Return at June 30, 1995
Since Inception 6 Month
10.07% 16.25%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 7/1/93 10000
Three Months Ended 9/30/93 10560
Three Months Ended 12/31/93 10501
Three Months Ended 3/31/94 10339
Three Months Ended 6/30/94 10116
Three Months Ended 9/30/94 10582
Three Months Ended 12/31/94 10422
Three Months Ended 3/31/95 11180
Three Months Ended 6/30/95 12115
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, returns would have been lower.
2
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund
Dear Contract Owner:
Colonial-Keyport Utilities Fund has two straightforward goals: primarily
current income, and secondarily, long-term growth. The Fund pursues its
objective by investing in common and preferred stocks issued by domestic
utility companies.
Fund Performance (through June 30, 1995)
Inception Date 7/1/93
6-month total return, assuming
reinvestment of all distributions 14.06%
Average annual total return, assuming
reinvestment of all distributions 0.30%
Net asset value per share on 12/31/94 $8.11
Net asset value per share on 6/30/95 $ 9.25
Economic/Market Overview
Investors benefited from favorable developments in the utility stock market
during the six months ended June 30, 1995. Despite some swings in the
performance of individual sectors on a month-to-month basis, electric, natural
gas, and telephone company stocks all contributed to the utility market's
positive performance.
Several factors influenced the performance of utility stocks during the
semiannual period. Although unseasonably warm weather during the winter months
had a negative impact on the usage and price of natural gas, there was
improvement in natural gas prices later in the period. Telephone stocks were
affected by legislature proposals that would increase competition in local and
long distance markets. Competition concerns continued to cause some uncertainty
for electric utilities. However, these concerns moderated late in the period and
the result was improving prices for electric utility stocks. Finally, declining
interest rates provided a boost to the utilities market as a whole. Because of
their relatively high yields, utility stocks generally benefit from declining
interest rates.
Investment Strategy
Although the relatively high yields paid by electric utility stocks may
enhance the flow of income to shareholders, these stocks also are somewhat
volatile because of their sensitivity to interest rates. To reduce the possible
impact of fluctuating interest rates, we have gradually increased the diversity
of the portfolio. We've reduced exposure to electric stocks, and have placed
greater emphasis on telephone and natural gas stocks. We believe this shift in
emphasis may improve growth prospects over the long term.
Outlook
Colonial believes that the economy will slow over the course of 1995.
Historically, economic weakness has brought an easing of inflationary pressures
and lower interest rates, developments that have had a favorable impact on
utility stock prices.
John Lennon & James Haynie, co-portfolio managers
Colonial-Keyport Utilities Fund
Performance of a Hypothetical $10,000 Investment July 1, 1993 to June 30, 1995
----------------------------------------------------
Average Annual Total Return at June 30, 1995
Since Inception 6 Month
0.30% 14.06%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 7/1/93 10000
Three Months Ended 9/30/93 10260
Three Months Ended 12/30/93 9830
Three Months Ended 3/31/94 8954
Three Months Ended 6/30/94 8577
Three Months Ended 9/30/94 8699
Three Months Ended 12/31/94 8820
Three Months Ended 3/31/95 9364
Three Months Ended 6/30/95 10060
Performance numbers reflect all Fund net expenses, but do not include insurance
charges imposed by your insurance company's separate accounts or certain
expenses reimbursed by the Manager. If performance information included the
effect of these additional amounts, returns would be lower.
3
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport U.S. Government Fund
Dear Contract Owner:
Colonial-Keyport U.S. Government Fund pursues its objective of providing
high current income by investing primarily in U.S. government and agency
obligations. The Fund emphasizes mortgage-backed issues, such as those issued
by the Government National Mortgage Association (GNMA), and targets a specific
duration range. Duration is a measure that can be used to determine how much a
portfolio's value will change in response to interest rate fluctuations.
Portfolios with longer durations generally provide greater returns over time,
but with more risk and price volatility. Fund management maintains the average
duration of the Fund within a relatively narrow range of 2 to 4.5 years to help
consistently manage interest rate risk.
Fund Performance (through June 30, 1995)
Inception Date 7/1/93
6-month total return, assuming reinvestment
of all distributions 8.29%
Average annual total return since
inception, assuming reinvestment of all
distributions 4.15%
Net asset value per share on 12/31/94 $9.17
Net asset value per share on 6/30/95 $9.93
Economic/Market Overview
Economic growth has shown clear signs of moderating as inflationary pressures
diminish. After peaking in 1994, interest rates declined, setting the stage for
a powerful bond market rally in 1995. The government bond market, as measured by
the benchmark 30-year Treasury bond, rallied to gain back more than the value it
had lost in 1994. These positive developments were reflected in the net asset
value (NAV) of the Fund, which rebounded from its recent low of $9.16 on 1/5/95
to reach $9.93 on June 30, 1995. Those investors who remained invested in the
fund throughout the volatile 1994 market have been rewarded during this rally.
Investment Strategy
The Fund has benefited from its emphasis on lower-coupon mortgage-backed
securities, which performed quite well in the declining interest rate
environment. Refinancing activity--often a source of volatility in the
mortgage-backed securities market--is expected to increase. We have taken steps
to provide some protection as interest rates have fallen. We sold many
higher-coupon securities in the portfolio and invested the proceeds in current
coupon and discount holdings believed to offer better long-term value. Overall,
the Fund maintains a conservative emphasis. Discount holdings are offset by
mortgage-backed securities with shorter maturities as well as older "seasoned"
bonds. Bonds with shorter maturities help enhance the stability of the
portfolio. The older bonds, which have survived several cycles of interest rate
volatility, may provide some protection from the potential increase in
refinancing activity.
Outlook
The slowing economy and the Federal Reserve Board's commitment to fight
inflation, has calmed the market's fears. With its actively managed portfolio,
the Fund is well-positioned to take advantage of positive developments in the
fixed-income markets.
Leslie W. Finnemore, lead portfolio manager
Colonial-Keyport U.S. Government Fund
Performance of a Hypothetical $10,000 Investment July 1, 1993 to June 30, 1995
----------------------------------------------------
Average Annual Total Return at June 30, 1995
Since Inception 6 Month
4.15% 8.29%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 7/1/93 10000
Three Months Ended 9/30/93 10140
Three Months Ended 12/31/93 10161
Three Months Ended 3/31/94 9986
Three Months Ended 6/30/94 9934
Three Months Ended 9/30/94 10027
Three Months Ended 12/31/94 10017
Three Months Ended 3/31/95 10399
Three Months Ended 6/30/95 10847
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, returns would be lower.
4
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport International Fund for Growth
Dear Contract Owner:
Since the Fund began investment operations, Colonial's sub-adviser for the
Fund, Gartmore Capital Management Ltd., has selected investments designed to
help meet its objective of long- term capital growth by investing primarily in
non-U.S. equities.
Fund Performance (through June 30, 1995)
Inception Date 5/1/94
6-month total return, assuming reinvestment
of all distributions (3.72)%
Average annual total return since inception,
assuming reinvestment of all distributions (8.20)%
Net asset value per share on 12/31/94 $1.88
Net asset value per share on 6/30/95 $ 1.81
Economic/Market Overview
Global economic conditions were quite volatile during the Fund's semiannual
period, and this had a negative impact on performance. In Japan, the Kobe
earthquake had a chilling effect on that country's economy, shutting down one of
Japan's main ports and shaking consumer confidence.
The devaluation of the Mexican peso did not have as profound an effect as
events in Japan. However, it was significant none-the-less. In Argentina and
Brazil, which have stronger economies than Mexico, peso related declines were
exaggerated. However, in general, economic weakness should continue across
Central and South America.
Although there are no direct economic links between Latin America and the Far
East, the problems encountered by Mexico reduced investor confidence in other
emerging mar- kets. Unlike Latin America, however, these economies remain
fundamentally sound.
In continental Europe, the Deutschemark strengthened relative to the U.S.
dollar, and this hurt German exports. Because the European Rate Mechanism is
keyed on the Deutschemark, the performance of the German currency influenced
most of the other European economies.
The United Kingdom appears to be an exception to the prevailing European
trends. Britain is enjoying a sustained, broad-based recovery--gross domestic
product for 1994 was 3.9%. Exports have been strong, and low investor
consumption and weakness in the housing sector have helped keep inflation under
control.
Investment Strategy
Japanese investments have been maintained at a relatively low level,
reflecting the weakness of Japan's economy. Investments in continental Europe
have also been underweighted, a decision that may have had a negative influence
on performance, as many local currencies strengthened in relation to the U.S.
dollar. The Fund has benefited from the high profile given to investments in the
United Kingdom, as that country's economy continued to expand. Gartmore
maintains a position in emerging markets, including those of the Far East. These
markets should continue to be a source of significant growth over the long term.
Andrew Fleming, lead portfolio manager
Colonial-Keyport International Fund for Growth
Performance of a Hypothetical $10,000 Investment May 1, 1994 to June 30, 1995
----------------------------------------------------
Average Annual Total Return at June 30, 1995
Since Inception 6 Month
(8.20)% (3.72)%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 5/1/94 10000
Three Months Ended 6/30/94 9700
Three Months Ended 9/30/94 9950
Three Months Ended 12/31/94 9400
Three Months Ended 3/31/95 8850
Three Months Ended 6/30/95 9050
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, it would be lower.
5
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund
Dear Contract Holder:
In the 11 months since the Fund's began investment operations, the portfolio
management of Colonial-Keyport Strategic Income Fund has selected investments
that are expected to meet its objective of providing as high a level of current
income and total return as is consistent with prudent risk. The Fund pursues
this objective by diversifying investments primarily in U.S. and foreign
government and high yield, high risk corporate debt securities.
Fund Performance (through June 30, 1995)
Inception Date 7/5/94
6-month total return, assuming
reinvestment of all distributions 11.03%
Cumulative total return since inception,
assuming reinvestment of all
distributions 12.25%
Net asset value on 12/31/94 $9.79
Net asset value on 6/30/95 $10.87
Economic/Market Overview
Almost all sectors of the bond market performed well during the period,
including the sectors that are your Fund's primary investment focus. High yield
corporate bonds benefited from strong earnings growth by their issuing
corporations. Foreign bonds showed some improvement as local currencies
strengthened relative to the U.S. dollar. Finally, there was a dramatic recovery
in the U.S. government bond market, reflecting a general decline in U.S.
interest rates.
U.S. Government Market
It appears likely the Federal Reserve Board will achieve its goal of a "soft
landing" for the economy. This has already been reflected in a marked slowing of
the economy. Annualized gross domestic product, which was 5.1% for the fourth
quarter of 1994, declined to 2.8% for the first quarter of 1995. This slowing of
the U.S. economy and the general decline in interest rates that followed sparked
a recovery in the U.S. government bond market. For example, the yield for the
30-year Treasury bond declined from 7.89% on December 30, 1994, to 6.63% on June
30, 1995.
High Yield U.S. Corporate Market
During the period high yield corporate bonds benefited from increased demand.
Many investors were attracted by the attractive yields available from these
securities as yields from some other investments declined. Although high yield
corporate remains the Fund's largest sector, we have reduced our holdings here
to further diversify the portfolio.
International Market
To reduce the Fund's sensitivity to economically volatile markets, many of
the higher yielding markets, including Spain, were given lower profiles in the
portfolio during the period. Greater emphasis was placed on developed countries,
primarily those of Northern Europe. Among these was Denmark, which is currently
the Fund's largest foreign country position. Denmark has become attractive
because of deficit reduction and a strong export market.
Outlook
As expected, interest rates have moved lower during 1995. Although there may
be periods of consolidation when rates move slightly higher, we believe the
overall interest rate trend will remain favorable for fixed-income investments.
Carl Ericson, lead portfolio manager
Colonial-Keyport Strategic Income Fund
Performance of a Hypothetical $10,000 Investment July 5, 1994 to June 30, 1995
----------------------------------------------------
Cumulative Annual Total Return at June 30, 1995
Since Inception 6 Month
12.25% 11.03%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 7/5/94 10000
Three Months Ended 9/30/94 10090
Three Months Ended 12/31/94 10110
Three Months Ended 3/31/95 10678
Three Months Ended 6/30/95 11225
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, returns would be lower.
6
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth
Dear Contract Owner:
Colonial-Keyport U.S. Fund for Growth seeks growth over time exceeding the
Standard & Poor's 500 Index performance.
Fund Performance (through June 30, 1995)
Inception Date 7/5/94
6-month total return, assuming
reinvestment of all distributions 18.31%
Cumulative total return since inception,
assuming reinvestment of all
distributions 23.51%
Net asset value per share on 12/31/94 $10.27
Net asset value per share on 6/30/95 $12.14
Economic/Market Overview
Investors benefited from favorable conditions in the stock market during the
period ended June 30, 1995. Stocks maintained their strong performance despite
the slowing growth of the United States economy during the first half of the
fiscal year.
Almost all sectors of the stock market performed well during the period,
which was characterized by sharply rising earnings in late 1994 and strongly
rising stock prices in the first half of 1995. The larger capitalization U.S.
companies that are the main investment focus of your Fund benefited from the
weakened dollar, as the relatively low price of U.S. goods and services
attracted the attention of foreign consumers. These companies also did well as
investors sought out the stability provided by these stocks as the U.S.
economy began to slow.
Investment Strategy
Because the Fund's goal is to outperform the S&P 500 Index, the Fund remained
fully invested in the stock market and maintained the same overall sector and
industry exposure relative to the S&P 500. We continue to believe that the best
way to outperform the S&P 500 is through superior stock selection. The portfolio
management team at State Street Global Advisors, Colonial's sub-advisor for the
Fund, is continually investing in those companies that exhibit the best
combination of fundamental value and rising earnings estimates by Wall Street
analysts.
Doug Holmes, co-portfolio manager
Tony Ryan, co-portfolio manager
Colonial-Keyport U.S. Fund for Growth
Performance of a Hypothetical $10,000 Investment July 5, 1994 to June 30, 1995
----------------------------------------------------
Cumulative Annual Total Return at June 30, 1995
Since Inception 6 Month
23.51% 18.31%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 6/30/94 10000
Three Months Ended 9/30/94 10460
Three Months Ended 12/31/94 10440
Three Months Ended 3/31/95 11426
Three Months Ended 6/30/95 12340
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, it would be lower.
7
<PAGE>
PORTFOLIO MANAGER'S DISCUSSION
Keyport Variable Investment Trust Newport-Keyport Tiger Fund
Dear Contract Owner:
Newport-Keyport Tiger Fund seeks capital appreciation by investing primarily
in common stocks of companies in the "Tiger" countries of Asia, which include
the markets of China, Hong Kong, Indonesia, South Korea, Malaysia, the
Philippines, Singapore, Taiwan, and Thailand. While these markets are subject
to risks not associated with more developed countries, Fund management has more
than 25 years of investment experience in the region, and is a leader in Asian
investing. The newest member of the Keyport product line, the Fund began
investment operation on May 1, 1995, but was originally established in 1989 as
a traditional mutual fund product.
Fund Performance (through June 30, 1995)
Inception Date 5/1/95
Cumulative total return since inception,
assuming reinvestment of all
distributions 9.00%
Net asset value per share on 5/1/95 $2.00
Net asset value on 6/30/95 $2.18
Economic/Market Overview
Throughout the first half of 1995, equity investments provided attractive
returns for investors. Most impressive was the fact that this strong performance
was maintained despite a slowing of economic growth in the United States.
Foreign stocks, especially the nine Tigers that are your Fund's primary
investment focus, benefited from strong economies at home and the strength of
local currencies versus the weakened U.S. dollar. Large capitalization "blue
chip" stocks of the Tiger region, in which your Fund invests, did well as
investors sought out the stability provided by these stocks as the U.S. economy
began to slow.
Investment Strategy
Since the Fund's inception, investments have been focused on six of the nine
countries in which the Fund can invest. Investments in Taiwan, China, and the
Philippines were avoided because of limited investment opportunities and
economic concerns about those countries. Of the remaining countries, investments
in Hong Kong, Singapore, and Malaysia received particular emphasis, as these
countries were believed to have the greatest growth potential. Despite political
issues that may cause the Fund to fluctuate over the short-term, management
believes they offer great potential over the long-term.
Outlook
Newport, the fund's adviser, believes economic conditions for the Tigers will
improve in the months ahead. Stocks available in this region are attractively
priced, and may offer significant growth opportunities in the future.
John M. Mussey, lead portfolio manager
Newport-Keyport Tiger Fund
Performance of a Hypothetical $10,000 Investment May 1, 1995 to June 30, 1995
----------------------------------------------------
Total Return at June 30, 1995
Since Inception
9.00%
----------------------------------------------------
Measurement Pt-Three Months Ended
Three Months Ended 5/1/95 10000
Three Months Ended 5/31/95 11100
Three Months Ended 6/30/95 10900
Performance numbers reflect all Fund net expenses, but do not include any
insurance charges imposed by your insurance company's separate accounts or
certain expenses reimbursed by the Manager. If performance information included
the effect of these additional amounts, returns would be lower.
8
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund /
June 30, 1995
Country
Abbrev. Shares Value
------ --------- ------------
Common stocks--(83.0%)
Construction--(0.4%)
Building Construction--(0.3%)
Koninklijke Volker Stevin NV Ne 3,000 $ 193,836
----------
Heavy Construction--Non Building Construction--(0.1%)
Ericsson Spa It 3,000 44,822
----------
Finance, Insurance & Real Estate--(11.7%)
Depository Institutions--(2.7%)
Bank of Montreal Ca 17,300 362,531
Den Danske Bank No 3,000 188,525
Jyske Bank No 3,000 228,566
National Australia Bank Ltd. Au 38,800 306,182
Toronto Dominion Bank Ca 34,100 525,065
----------
1,610,869
----------
Insurance Carriers--(7.4%)
American Bankers Insurance Group, Inc. 17,700 561,975
Aon Corp. 21,100 785,975
Cigna Corp. 16,300 1,265,288
Excel Ltd. 3,500 182,000
Life Re Corp. 11,000 204,875
St. Paul Companies, Inc. 27,200 1,339,600
----------
4,339,713
----------
Security Brokers & Dealers--(1.6%)
A.G. Edwards, Inc. 37,200 837,000
Alex Brown, Inc. 1,900 78,850
Jefferies Group, Inc. 200 7,200
----------
923,050
----------
Manufacturing--(50.9%)
Apparel--(1.4%)
Gamma Holding NV Ne 3,000 155,068
VF Corp. 13,000 698,750
----------
853,818
----------
Chemicals--(8.8%)
Akzo Nobel NV Ne 14,074 842,681
ARCO Chemical Co. 10,100 458,288
Freeport-McMoRan Resource Partners,
L.P. 30,900 533,025
Marion Merrell Dow, Inc. 6,200 158,100
Union Carbide Corp. 44,900 1,498,538
Upjohn Co. 29,900 1,132,463
Wellman, Inc. 20,500 561,188
----------
5,184,283
----------
Food & Kindred Products--(4.8%)
Adolph Coors Co., Class B 15,400 252,175
IBP, Inc. 35,900 1,561,650
International Multifoods Corp. 15,300 344,250
Seagram Co., Ltd. 20,000 692,500
----------
2,850,575
----------
Machinery & Computer Equipment--(15.4%)
Apple Computer, Inc. 32,300 $1,499,931
Briggs and Stratton Corp. 14,700 507,150
Cummins Engine Co., Inc. 33,000 1,439,625
Deere & Co. 13,300 1,138,813
Indresco, Inc. (a) 27,500 426,250
Scitex Corp. ADR G 5,700 122,550
Seagate Technology, Inc. (a) 40,200 1,577,850
Strattec Security Corp. (a) 120 1,470
Sun Microsystems, Inc. (a) 25,600 1,241,600
Tandem Computers, Inc. (a) 70,800 1,141,650
----------
9,096,889
----------
Measuring & Analyzing Instruments--(0.9%)
Becton, Dickinson & Co. 4,100 238,825
Loral Corp. 2,700 139,725
Raytheon Co. 2,300 178,538
----------
557,088
----------
<PAGE>
Paper & Paper Mills--(1.2%)
Louisiana-Pacific Corp. 6,600 173,250
Weyerhaeuser Co. 11,000 518,374
----------
691,624
----------
Petroleum Refining--(1.3%)
Mobil Corp. 8,100 777,600
----------
Primary Smelting--(0.8%)
Phelps Dodge Corp. 8,400 495,600
----------
Printing & Publishing--(0.7%)
New York Times Co., Class A 15,800 371,300
Standard Register Co. 2,900 55,100
----------
426,400
---------
Rubber & Plastic--(1.7%)
Goodyear Tire & Rubber Co. 23,900 985,875
---------
Textile Mill Products--(1.8%)
Springs Industries, Inc. 29,000 1,080,250
---------
Tobacco Products--(2.7%)
American Brands, Inc. 40,600 1,613,850
---------
Transportation Equipment--(9.4%)
Equipements et Composants pour
l'Industrie Automobile Fr 2,050 281,634
Harsco Corp. 12,000 633,000
Lockheed Martin Corp. 23,100 1,458,188
McDonnell Douglas Corp. 13,700 1,051,475
Rockwell International Corp. 6,500 297,375
Textron, Inc. 21,800 1,267,124
Thiokol Corp. 18,300 553,575
---------
5,542,371
See Notes to Investment Portfolio.
9
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund /
June 30, 1995
Country
Abbrev. Shares Value
------ --------- ------------
Mining & Energy--(2.4%)
Metal Mining--(1.3%)
Magma Copper Co., Class B 45,800 $ 744,250
----------
Nonmetallic, Except Fuels--(0.7%)
Potash Corp. of Saskatchewan, Inc. 7,300 408,379
----------
Oil & Gas Extraction--(0.4%)
Imperial Oil Ltd. 6,400 237,600
----------
Retail trade--(5.7%)
Apparel & Accessory Stores--(0.6%)
J. Baker, Inc. 6,400 64,800
Koninklijke Bijenkorf Ne 3,000 215,546
Macintosh NV Ne 3,000 87,226
367,572
----------
General Merchandise Stores--(5.1%)
Caldor Corp. (a) 20,500 366,438
Dillard Department Stores, Inc. 9,900 290,813
J.C. Penney Co., Inc. 28,400 1,363,200
Mercantile Stores Company, Inc. 10,600 492,899
Waban, Inc. (a) 31,300 465,588
----------
2,978,938
----------
Services--(0.6%)
Business Services--(0.0%)
Harris Computer Systems Corp. (a) 275 3,781
----------
Engineering, Accounting, Research & Management--(0.6%)
International-Muller NV Ne 4,600 328,423
----------
Transportation, Communication, Electric, Gas & Sanitary Services--(10.4)
Communications--(3.5%)
Ameritech Corp. 19,700 866,800
BellSouth Corp. 4,500 285,750
Frontier Corp. 26,900 645,600
Pacific Telesis Group, Inc. 8,800 235,400
----------
2,033,550
----------
Electric, Gas & Sanitary Services--(0.4%)
Gas y Electricidad SA Sp 4,550 220,012
----------
Electric Services--(2.3%)
Consolidated Edison Co. of New York 5,900 174,050
Detroit Edison Co. 12,100 356,950
Portland General Corp. 25,400 561,974
Western Resources, Inc. 8,500 262,438
----------
1,355,412
----------
Gas Services--(1.4%)
British Gas PLC ADR (a) UK 1,970 90,620
Brooklyn Union Gas Co. 10,600 278,250
Energen Corp. 20,300 436,450
----------
805,320
----------
Sanitary Services--(1.5%)
North West Water PLC UK 25,100 $ 222,122
Northumbrian Water Group PLC UK 30,600 453,641
Severn Trent Water PLC UK 25,000 216,453
----------
892,216
----------
Water Transportation--(1.3%)
American Presidents Companies 32,400 769,500
----------
Wholesale Trade--(0.9%)
Durable Goods--(0.7%)
Beers NV Ne 1,447 192,597
Handleman Co. 20,500 197,313
----------
389,910
----------
Nondurable Goods--(0.2%)
Bindley Western Industries, Inc. 1,300 20,638
Bon-Ton Stores, Inc. (a) 6,500 67,844
----------
88,482
----------
<PAGE>
Total Common Stocks (Cost $42,442,040) 48,891,858
----------
Par
-------
Government obligations--(9.5%)
U.S. Government Agencies--(6.1%)
Federal National Mortgage Association, 6.500%
08/01/2008 $3,631,397 3,581,464
----------
U.S. Government Bonds--(3.4%)
U.S. Treasury Notes, 7.875% 04/15/1998 1,895,000 1,990,337
----------
Total Government Obligations
(Cost $5,633,768) 5,571,801
----------
Total Investments--(92.5%)
(Cost $48,075,808) (b) 54,463,659
----------
Short term obligations--(7.3%)
Repurchase agreement with Lehman Government
Securities, Inc., dated 6/30/95, due 7/03/95 at 6.210%, collateralized by U.S.
Treasury notes and bills with maturities to 1999, market value
4,381,093 (repurchase proceeds $4,289,219) 4,287,000 4,287,000
----------
Other Assets and Liabilities--Net--(0.2%) 155,714
----------
Net Assets--(100%) $58,906,373
==========
Notes to investment portfolio:
(a) Non-income producing.
(b) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $7,191,961
Gross unrealized depreciation (804,314)
---------
Net unrealized appreciation $6,387,647
=========
Notes to investment portfolio continued on following page.
See Notes to Investment Portfolio.
10
<PAGE>
Summary of Securities by Country
% of Total
Country Securities
Country Abbrev. Value at Value
----------------- ------ ---------- ----------
United States $49,185,559 89.2%
Netherlands Ne 2,015,377 4.1%
United Kingdom UK 982,836 2.0%
Canada Ca 887,596 1.8%
Norway No 417,091 0.9%
Australia Au 306,182 0.6%
France Fr 281,634 0.6%
Spain Sp 220,012 0.4%
Germany G 122,550 0.3%
Italy It 44,822 0.1%
-------- --------
$54,463,659 100.0%
======== ========
Certain securities are listed by country of underlying exposure but may
trade predominantly on other exchanges.
Acronym Name
---------- ---------------------------------
ADR American Depository Receipt
See Notes to Financial Statements
11
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund /
June 30, 1995
Assets:
Investments, at market value (Identified cost $48,075,808) $54,463,659
Short-term obligations 4,287,000
Cash (including foreign currencies) 1,541
Receivable for investments sold 63,577
Dividends and interest receivable 211,228
Unamortized organization expenses 17,029
Other assets 3,411
----------
Total assets 59,047,445
----------
Liabilities:
Payable for fund shares repurchased 53,972
Management fee payable 61,981
Accrued expenses payable 25,119
----------
Total liabilities 141,072
----------
Net assets $58,906,373
==========
Net assets represented by:
Paid-in capital $52,073,808
Accumulated undistributed net investment income 717,952
Accumulated net realized losses on investments and foreign
currency transactions, less distributions (273,034)
Net realized appreciation on investments and foreign
currency transactions 6,387,647
----------
Total net assets applicable to shares of beneficial interest
outstanding $58,906,373
==========
Shares of beneficial interest outstanding 5,053,370
==========
Net asset value per share $11.66
==========
STATEMENT OF OPERATIONS (Unaudited)
Six months ended June 30, 1995
Investment income:
Dividends (net of foreign taxes withheld) $ 667,039
Interest income 301,886
--------
Total investment income 968,925
--------
Expenses:
Management fee 170,974
Bookkeeping fee 16,148
Transfer agent fee 3,754
Audit fees 9,991
Printing expense 6,056
Trustees' expense 849
Custodian fee 1,590
Amortization of organization expense 4,328
Miscellaneous expense 1,918
--------
Total expenses 215,608
--------
Net investment income 753,317
Realized and unrealized gains on investments and foreign currency
transactions:
Net realized gains on investments 639,299
Net realized gains on foreign currency transactions 2,571
Change in unrealized appreciation on investments and foreign
currency transactions 6,627,974
--------
Net increase in net assets resulting from operations $8,023,161
========
See Notes to Financial Statements.
12
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund
(Unaudited)
Six Months
Ended Year Ended
June 30, December 31,
1995 1994
---------- ------------
Operations:
Net investment income $ 753,317 $ 1,187,189
Net realized gains (losses) on investments 639,299 (916,325)
Net realized gains on foreign currency
transactions 2,571 1,095
Unrealized appreciation (depreciation) on
investments and foreign currency
transactions 6,627,974 (750,636)
-------- ----------
Net increase (decrease) in net assets
resulting from operations 8,023,161 (478,677)
-------- ----------
Distributions declared from:
Net investment income -- (1,166,885)
-------- ----------
Total distributions -- (1,166,885)
-------- ----------
Fund share transactions:
Proceeds from fund shares sold 6,029,836 24,032,360
Cost of fund shares repurchased (3,198,601) (4,799,935)
Distributions reinvested -- 1,166,885
-------- ----------
Net increase in net assets resulting from
fund share transactions 2,831,235 20,399,310
-------- ----------
Total increase in net assets 10,854,396 18,753,748
Net assets:
Beginning of period 48,051,977 29,298,229
-------- ----------
End of period $58,906,373 $48,051,977
======== ==========
Accumulated undistributed (overdistributed)
net investment income included in ending
net assets $ 717,952 $ (35,365)
======== ==========
Analysis of changes in shares of beneficial interest:
Shares sold 560,719 2,314,716
Shares redeemed (299,118) (468,593)
Distributions reinvested -- 117,157
-------- ----------
Net increase 261,601 1,963,280
======== ==========
See Notes to Financial Statements.
13
<PAGE>
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport Growth and Income Fund
(Unaudited)
Six Months
Ended Year Ended
June 30, December 31,
-------- ---------------------
1995 1994 1993***
-------- ------ -----------
Per share operating performance:
Net asset value, beginning of period $10.03 $10.36 $10.00
------ ---- ---------
Net investment income 0.15 0.26 0.09
Net realized and unrealized gains (losses)
on investments and foreign currency
transactions 1.48 (0.34) 0.41
------ ---- ---------
Total from investment operations 1.63 (0.08) 0.50
------ ---- ---------
Less distributions from:
Dividends from net investment income -- (0.25) (0.11)
Net realized gains on investments -- -- (0.03)
------ ---- ---------
Total distributions -- (0.25) (0.14)
====== ==== =========
Net asset value, end of period $11.66 $10.03 $10.36
====== ==== =========
Total return:
Total investment return 16.25%** (0.76)% 5.01%**(b)
Ratios/supplemental data:
Net assets, end of period (000) $58,906 $48,052 $29,298
Ratio of net expenses to average
net assets 0.82%* 0.87% 1.00%*(a)
Ratio of net investment income to average
net assets 2.86%* 2.82% 2.32%*(b)
Portfolio turnover ratio 94%* 55% 8%**
* Annualized
** Not Annualized.
*** For the period from the commencement of operations July 1, 1993 to
December 31, 1993.
(a) If the Fund had paid all of its expenses and there had been no
reimbursement from the Manager, as described in Note 5, this ratio would
have been 1.23% (annualized) for the period ended December 31, 1993.
(b) Computed giving effect to Manager's expense limitation undertaking.
See Notes to Financial Statements.
14
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund /
June 30, 1995
Shares Value
----- --------
Common Stocks--(81.2%)
Transportation, Communication, Electric, Gas & Sanitary Services--(81.2%)
Communications--(22.6%)
AT&T Corp. 11,000 $ 584,375
Ameritech Corp. 25,500 1,122,000
Bell Atlantic Corp. 19,800 1,108,800
BellSouth Corp. 17,300 1,098,550
Frontier Corp. 12,500 300,000
GTE Corp. 42,800 1,460,550
MCI Communications Corp. 17,000 374,000
NYNEX Corp. 37,000 1,489,250
Southwestern Bell Corp. 26,500 1,262,063
Sprint Corp. 4,500 151,313
US West, Inc. 22,500 936,563
---------
9,887,464
---------
Electric Services--(49.7%)
American Electric Power Co., Inc. 16,000 562,000
Baltimore Gas & Electric Co. 7,300 182,500
Boston Edison Co. 23,700 619,162
CMS Energy Corp. 25,000 615,625
Carolina Power & Light Co. 16,000 484,000
Cincinnati Gas & Electric Co. 40,000 1,050,000
Consolidated Edison Co. of New York 2,800 82,600
DPL, Inc. 53,000 1,172,625
Detroit Edison Co. 41,200 1,215,400
Duke Power Co. 2,200 91,300
Eastern Utilities Assoc. 10,000 226,250
Entergy Corp. 20,000 482,500
FPL Group, Inc. 36,000 1,390,500
Florida Progress Corp. 7,300 228,125
General Public Utilities Corp. 37,000 1,100,750
Hawaiian Electric Industries, Inc. 16,600 603,825
Houston Industries, Inc. 6,000 252,750
IES Industries, Inc. 21,100 469,475
KU Energy Corp. 8,000 223,000
Kansas City Power & Light Co. 22,500 514,687
Long Island Lighting Co. 24,400 378,200
Montana Power Co. 8,000 184,000
New York State Electric & Gas Corp. 12,000 280,500
Northeast Utilities 21,500 483,750
Ohio Edison Co. 27,000 610,875
PacifiCorp 61,000 1,143,750
Peco Energy Co. 12,600 348,075
Pinnacle West Capital Corp. 25,000 612,500
Portland General Corp. 22,000 486,750
Public Service Co. of Colorado 19,500 633,750
Public Service Enterprise Group, Inc. 14,000 388,500
Puget Sound Power & Light Co. 6,400 146,402
Rochester Gas & Electric Corp. 4,500 $ 95,625
SCE Corp. 7,400 126,725
Scana Corp. 13,000 290,875
Sierra Pacific Resources 7,500 163,125
Southern Co. 55,000 1,230,625
Texas Utilities Co. 31,000 1,065,625
Union Electric Co. 6,800 253,300
Utilicorp United, Inc. 20,500 576,563
Western Resources, Inc. 22,000 679,250
---------
21,745,837
---------
Gas Services--(8.9%)
Energen Corp. 6,700 144,050
MCN Corp. 31,500 622,125
MDU Resources Group, Inc. 6,000 178,500
Pacific Enterprises 16,900 414,050
Panhandle Eastern Corp. 22,200 541,125
People's Energy Corp. 15,000 388,125
Public Service Co. of North Carolina 10,000 163,750
UGI Corp. 25,500 538,687
Williams Companies, Inc. 26,400 920,700
---------
3,911,112
---------
Total Common Stocks (Cost $36,805,633) 35,544,413
---------
Preferred Stocks--(14.8%)
Transportation, Communication, Electric, Gas & Sanitary Services--(14.8%)
Electric Services--(13.2%)
Appalachian Power Co., 7.40% 1,000 99,875
Arizona Public Service Co., $1.8125, Series W 12,000 286,500
Baltimore Gas & Electric Co., 6.75% 1,551 153,743
Central Power & Light Co., 7.12% 6,000 600,000
Commonwealth Edison Co., 7.24% 5,500 481,250
Detroit Edison Co., 7.36% 3,000 280,500
Duquesne Light Co., $7.20 1,500 139,500
Florida Power & Light Co., 7.40%, Series G 2,500 250,938
Florida Power & Light Co., 7.40% 343 34,428
Montana Power Co., $6.875 5,000 478,750
Northern Indiana Public Service Co., 7.44% 1,000 97,500
Ohio Edison Co.:
7.24% 1,200 103,800
7.36% 2,000 173,750
PSI Energy, Inc.:
6.875% 4,000 376,000
7.44% 13,000 323,375
Peco Energy Co., 7.48% 2,000 194,000
Pennsylvania Power & Light Co., 6.75% 5,000 470,000
See Notes to Investment Portfolio.
15
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund /
June 30, 1995
PREFERRED STOCKS (Continued)
Public Service Electric & Gas Co., 7.52% 2,000 $193,000
Southern California Edison Co., 7.36% 11,000 259,875
Texas Utilities Co.:
7.22% 20,000 465,000
7.50% 8,000 190,000
Union Electric Co., $7.44 1,000 99,125
---------
5,750,909
---------
Gas Services--(1.6%)
Enron Corp., MIPS 8.00% 20,000 495,000
Pacific Enterprises, $4.50 550 33,687
Williams Co., Inc., $3.50 3,000 184,500
---------
713,187
---------
Total Preferred Stocks (Cost $6,784,417) 6,464,096
---------
Total Investments--(96.0%)
(Cost $43,590,050) (a) 42,008,509
---------
Par Value
--------- -----------
Short-term obligations--(3.5%)
Repurchase agreement with
Lehman Government Securities, Inc., dated 6/30/95 due 7/03/95 at 6.210%,
collateralized by U.S. Treasury bills and notes with various maturities to
1999 market value $1,553,362
(repurchase proceeds $1,520,787) $1,520,000 $ 1,520,000
---------
Other Assets & Liabilities--Net--(0.5%) 224,414
---------
Net Assets--100% $43,752,923
=========
Notes to investment portfolio:
(a) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $ 1,439,007
Gross unrealized depreciation (3,020,548)
----------
Net unrealized depreciation $(1,581,541)
==========
See Notes to Financial Statements.
16
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund /
June 30, 1995
Assets:
Investments, at market value (Identified cost $43,590,050) $42,008,509
Short-term obligations 1,520,000
Receivable for fund shares sold 5,103
Receivable for investments sold 101,000
Dividends and interest receivable 265,992
Unamortized organization expenses 17,211
Other assets 8,119
----------
Total assets 43,925,934
----------
Liabilities:
Payable for fund shares repurchased 66,414
Payable for investments purchased 39,396
Management fee payable 46,388
Accrued expenses payable 20,813
----------
Total liabilities 173,011
----------
Net assets $43,752,923
==========
Net assets represented by:
Paid-in capital $48,411,628
Accumulated undistributed net investment income 1,068,321
Accumulated net realized losses on investments (4,145,485)
Net unrealized depreciation on investments (1,581,541)
----------
Total net assets applicable to shares of beneficial interest
outstanding $43,752,923
==========
Shares of beneficial interest outstanding 4,729,152
==========
Net asset value per share $9.25
==========
STATEMENT OF OPERATIONS (Unaudited)
Six months ended June 30, 1995
Investment income:
Dividends $1,224,182
Interest income 61,741
---------
Total investment income 1,285,923
---------
Expenses:
Management fee 132,001
Bookkeeping fee 11,176
Transfer agent fee 2,511
Audit fees 9,991
Legal fee 248
Printing expense 5,383
Custodian fee 5,198
Amortization of organization expense 4,096
Miscellaneous expense 1,857
---------
Total expenses 172,461
---------
Net investment income 1,113,462 Realized and unrealized gains (losses) on
investments:
Net realized losses on investments (813,112)
Change in unrealized appreciation on investments 5,076,795
---------
Net increase in net assets resulting from operations $5,377,145
=========
See Notes to Financial Statements.
17
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund
(Unaudited)
Six Months Year
Ended Ended
June 30, December 31,
1995 1994
---------- -------------
Operations:
Net investment income $ 1,113,462 $ 2,402,638
Net realized losses on investments (813,112) (3,328,893)
Unrealized appreciation (depreciation) on
investments 5,076,795 (4,219,576)
-------- -----------
Net increase (decrease) in net assets
resulting from operations 5,377,145 (5,145,831)
-------- -----------
Distributions declared from:
Net investment income -- (2,402,638)
Distributions in excess of net investment
income -- (20,932)
-------- -----------
Total distributions -- (2,423,570)
-------- -----------
Fund share transactions:
Proceeds from fund shares sold 4,757,504 14,643,077
Cost of fund shares repurchased (4,537,535) (25,782,409)
Distributions reinvested -- 2,423,570
-------- -----------
Net increase (decrease) in net assets
resulting from fund share transactions 219,969 (8,715,762)
-------- -----------
Total increase (decrease) in net assets 5,597,114 (16,285,163)
Net assets:
Beginning of period 38,155,809 54,440,972
-------- -----------
End of period $43,752,923 $ 38,155,809
======== ===========
Accumulated undistributed (overdistributed)
net investment income included in ending net
assets $ 1,068,321 $ (45,141)
======== ===========
Analysis of changes in shares of beneficial interest:
Shares sold 549,019 1,633,132
Shares redeemed (526,458) (2,867,457)
Distributions reinvested -- 298,102
-------- -----------
Net increase (decrease) 22,561 (936,223)
======== ===========
See Notes to Financial Statements.
18
<PAGE>
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport Utilities Fund
<TABLE>
<CAPTION>
(Unaudited)
Six
Months
Ended Year Ended
June 30, December 31,
---------- -----------------------
1995 1994 1993***
-------- ------- -------------
<S> <C> <C> <C>
Per share operating performance:
Net asset value, beginning of period $ 8.11 $ 9.65 $10.00
------ ------ ------
Net investment income 0.24 0.54 0.18
Net realized and unrealized gains (losses) on investments 0.90 (1.53) (0.35)
------ ----- ------
Total from investment operations 1.14 (0.99) (0.17)
------ ----- ------
Less distributions from:
Dividends from net investment income -- (0.55) (0.18)
------ ----- ------
Net asset value, end of period $ 9.25 $ 8.11 $ 9.65
====== ====== ======
Total return:
Total investment return 14.06%** (10.27)% (1.70)%**(b)
Ratios/supplemental data:
Net assets, end of period (000) $43,753 $38,156 $54,441
Ratio of net expenses to average net assets 0.84%* 0.86% 1.00%*(a)
Ratio of net investment income to average net assets 5.43%* 5.80% 5.10%*(b)
Portfolio turnover ratio 16%* 16% 2%**
</TABLE>
* Annualized
** Not Annualized
*** For the period from the commencement of operations July 1, 1993 to
December 31, 1993.
(a) If the Fund had paid all of its expenses and there had been no
reimbursement from the Manager, as described in Note 5, this ratio would
have been 1.09% (annualized) for the period ended December 31, 1993.
(b) Computed giving effect to Manager's expense limitation undertaking.
See Notes to Financial Statements.
19
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport U.S. Government Fund /
June 30, 1995
Par Value
--------- -----------
U.S. Government & Agency Obligations--(105.4%)
Government Agencies--(80.4%)
Maturities
Coupon from/to
-------- -------------
Federal Home Loan Bank,
8.300% 1998(a) $1,000,000 $ 1,013,580
---------
Federal Home Loan Mortgage Corp.:
6.500% 2009 2,250,405 2,219,462
8.000% 2009 206,985 211,551
9.000% 2001-2022 141,863 147,653
9.250% 2016 129,062 133,861
10.500% 2013-2019 523,999 566,369
10.750% 2009 368,193 396,728
11.250% 2009 200,026 216,029
11.500% 2015-2016 104,066 112,930
12.250% 2012 63,360 68,746
---------
4,073,329
---------
Federal National Mortgage Association:
6.000% 2008-2025 (b) 3,697,083 3,543,868
6.500% 2009-2050 (b) 1,739,938 1,686,453
7.000% 2025 (b) 1,400,000 1,373,750
7.500% 2009-2050 (b) 3,269,606 3,284,905
8.000% 2009 12,325 12,583
8.500% 2010 649,371 676,157
9.000% 2005-2012 414,012 435,154
9.500% 2011 64,235 67,447
10.000% 2001-2016 (a) 628,875 674,481
10.250% 2016 286,379 310,182
10.500% 2001 250,122 262,471
12.250% 2012 88,713 97,252
---------
12,424,703
---------
Government National Mortgage Association:
6.500% 2024 1,011,849 972,002
7.000% 2025 (b) 600,000 590,062
9.500% 2009-2025 (a) 1,195,827 1,296,192
10.000% 2001 12,915 13,597
10.500% 2001 42,968 45,317
11.000% 2009 127,201 141,232
11.500% 2013 (a) 575,497 644,734
11.750% 2013 31,268 34,610
13.000% 2011 77,396 87,505
---------
3,825,251
---------
Total Government Agencies
(Cost $21,137,931) 21,336,863
---------
Par Value
-------- ------------
Government obligations--(23.1%)
U.S. Treasury Bonds:
7.625% 02/15/25 $ 346,000 $ 390,762
----------
U.S. Treasury Notes:
5.750% 08/15/03 2,679,000 2,597,371
6.750% 04/30/00 (a) 1,040,000 1,071,522
6.875% 03/31/00 (a) 1,283,000 1,327,905
7.750% 11/30/99 (a) 685,000 730,594
----------
5,727,392
----------
Total Government Obligations
(Cost $6,081,398) 6,118,154
----------
Other Government Agencies--(1.9%)
Student Loan Marketing Association,
9.400% 06/01/11
(Cost $451,769) 410,000 504,776
----------
Total Investments
(Cost $27,671,098) (c) 27,959,793
----------
Short-term obligations--(8.1%)
Repurchase agreement with
Lehman Government Securities, Inc.,
dated 6/30/95, due 7/03/95 at 6.210%,
collateralized by U.S. Treasury bills
and notes with various maturities to
1999, market value $2,189,013
(repurchase proceeds
$2,143,108) 2,142,000 2,142,000
----------
Other Assets &
Liabilities--Net--(-13.5)% (3,566,406)
----------
Net Assets--(100.0%) $26,535,387
==========
Notes to investment portfolio:
(a) These securities, or a portion thereof, with a total market value of
$6,668,905, are being used to collateralize the delayed delivery
purchases indicated in note (b) below.
(b) This security, or a portion thereof, has been purchased on a delayed
delivery basis whereby the terms that are fixed are the purchase price,
interest rate and the settlement date. The exact quantity purchased may
be slightly more or less than the amount shown.
(c) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $ 470,895
Gross unrealized depreciation (182,200)
--------
Net unrealized appreciation $ 288,695
========
See Notes to Financial Statements.
20
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport U.S. Government Fund /
June 30, 1995
Assets:
Investments, at market value (Identified cost $27,671,098) $27,959,793
Short-term obligations 2,142,000
Receivable for investments sold 2,252,779
Interest receivable 276,640
Unamortized organization expenses 16,779
Other assets 2,192
----------
Total assets 32,650,183
----------
Liabilities:
Payable for purchase of investments 6,054,205
Payable for fund shares repurchased 19,108
Management fee payable 27,217
Accrued expenses payable 14,266
----------
Total liabilities 6,114,796
----------
Net assets $26,535,387
==========
Net assets represented by:
Paid-in capital $26,992,893
Accumulated undistributed net investment income 963,280
Accumulated net realized losses on investments (1,709,481)
Net unrealized appreciation on investments 288,695
----------
Total net assets applicable to outstanding shares of
beneficial interest $26,535,387
==========
Shares of beneficial interest outstanding 2,672,708
==========
Net asset value per share $9.93
==========
STATEMENT OF OPERATIONS (Unaudited)
Six months ended June 30, 1995
Investment income:
Interest income $1,105,646
---------
Expenses:
Management fee 83,410
Bookkeeping fee 13,500
Transfer agent fee 3,750
Audit fees 9,991
Trustees' expense 2,819
Custodian fee 2,380
Printing expense 941
Amortization of organization expense 1,064
Miscellaneous expense 404
---------
Total expenses 118,259
---------
Net investment income 987,387 Realized and unrealized gains (losses) on
investments:
Net realized losses on investments (75,461)
Change in unrealized appreciation on investments 1,319,149
---------
Net increase in net assets resulting from operations $2,231,075
=========
See Notes to Financial Statements.
21
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport U.S. Government Fund
<TABLE>
<CAPTION>
(Unaudited)
Six Months Year
Ended Ended
June 30, December 31,
1995 1994
---------- -------------
<S> <C> <C>
Operations:
Net investment income $ 987,387 $ 2,270,320
Net realized losses on investments (75,461) (1,968,018)
Unrealized appreciation (depreciation) on investments 1,319,149 (793,538)
-------- -----------
Net increase (decrease) in net assets resulting from operations 2,231,075 (491,236)
-------- -----------
Distributions declared from:
Net investment income -- (1,713,139)
-------- -----------
Fund share transactions:
Proceeds from fund shares sold 479,680 9,589,075
Cost of fund shares repurchased (5,400,851) (10,751,940)
Distributions reinvested -- 1,713,139
-------- -----------
Net increase (decrease) in net assets resulting from fund share
transactions (4,921,171) 550,274
-------- -----------
Total decrease in net assets (2,690,096) (1,654,101)
Net assets:
Beginning of period 29,225,483 30,879,584
-------- -----------
End of period $26,535,387 $ 29,225,483
======== ===========
Accumulated undistributed (overdistributed) net investment income included
in ending net assets $ 963,280 $ (24,107)
======== ===========
Analysis of changes in shares of beneficial interest:
Shares sold 51,392 978,011
Shares redeemed (565,515) (1,103,787)
Distributions reinvested -- 186,820
-------- -----------
Net increase (decrease) (514,123) 61,044
======== ===========
</TABLE>
See Notes to Financial Statements.
22
<PAGE>
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport U.S. Government Fund
<TABLE>
<CAPTION>
(Unaudited)
Six Months
Ended Year Ended
June 30, December 31,
--------- ---------------------
1995 1994 1993***
--------- ------ ------------
<S> <C> <C> <C>
Per share operating performance:
Net asset value, beginning of period $9.17 $ 9.88 $10.00
------ ---- ---------
Net investment income 0.34 0.63 0.27
Net realized and unrealized gains (losses) on investments 0.42 (0.77) (0.11)
------ ---- ---------
Total from investment operations 0.76 (0.14) 0.16
------ ---- ---------
Less distributions:
Dividends from net investment income -- (0.57) (0.28)
------ ---- ---------
Net asset value, end of period $9.93 $ 9.17 $ 9.88
====== ==== =========
Total return:
Total investment return 8.29%** (1.42)% 1.61%**(b)
Ratios/supplemental data:
Net assets, end of period (000) $26,535 $29,225 $30,880
Ratio of net expenses to average net assets 0.85%* 0.86% 1.00%*(a)
Ratio of net investment income to average net assets 7.11%* 7.24% 6.88%*(b)
Portfolio turnover ratio 171%* 320% 125%**
</TABLE>
* Annualized.
** Not Annualized.
*** For the period from the commencement of operations July 1, 1993 to December
31, 1993.
(a) If the Fund had paid all of its expenses and there had been no reimbursement
from the Manager, as described in Note 5, this ratio would have been 1.14%
(annualized) for the period ended December 31, 1993.
(b) Computed giving effect to Manager's expense limitation undertaking.
See Notes to Financial Statements.
23
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
Country
Abbrev. Shares Value
------- ------ -----
COMMON STOCKS--(93.9%)
Construction--(2.9%)
Building Construction--(1.7%)
Hong Kong Land Co. HK 50,000 $ 91,000
Mitsui Fudosan Co. Ja 5,000 57,354
Shimizu Corp. Ja 20,000 193,739
----------
342,093
----------
Special Trade Contractors--(1.2%)
Tele Danmark A/S, Series B (a) De 4,500 250,255
----------
Finance, Insurance & Real Estate--(25.9%)
Depository Institutions--(10.4%)
Allied Irish Bank UK 25,000 118,591
Asahi Bank Ltd. Ja 12,000 128,293
Australia & New Zealand Banking Group Ltd. Au 15,000 53,224
Banco De Galicia Y Bueno ADR (a) Sp 2,300 36,225
Banco Popular Espanol SA Sp 1,800 268,267
Banque Nationale de Paris (a) Fr 3,000 145,026
Barclays PLC UK 20,000 215,417
Credit Local de France Fr 2,000 185,931
Dao Heng Bank Group Ltd. (a) HK 35,000 106,750
Deutsche Pfandbrief und Hypothekenbank AG G 200 101,375
Development Bank of Singapore Si 10,000 113,816
PT Bank International Indonesia (a) In 12,000 37,045
Shinhan Bank Ko 7,472 153,727
Sumitomo Bank Ja 7,000 121,559
Sumitomo Trust & Banking Ja 20,000 243,355
Turkiye Garanti Bankasi ADR Tu 7,400 20,280
Turkiye Garanti Bankasi GDS (a) Tu 3,500 42,000
Turkiye Garanti Bankasi RTS Tu 15,000 8,700
----------
2,099,581
----------
Holding & Other Investment Companies--(6.8%)
Desc S.A. ADR (a) Mx 2,000 25,750
Elsivier NV Ne 25,000 295,600
Five Arrows Chile Investment Trust Ch 70,000 203,000
Hong Leong Credit BHD Ma 20,000 100,902
Korea Liberalization Fund (a) Ko 150 106,950
Smaller Companies Investment Trust PLC UK 100,000 196,124
TR Smaller Companies Investment Trust PLC UK 40,000 $ 117,993
Taiwan Index Fund Tw 5,000 55,650
Thai Euro Fund IDR (a) Th 8,000 270,000
----------
1,371,969
----------
Insurance Agents & Brokers--(0.3%)
Sedgwick Group PLC UK 25,000 54,811
----------
Insurance Carriers--(3.4%)
General Accident Fire and Life Assurance
Corporation PLC UK 20,000 183,686
Yasuda Fire & Marine Insurance Co. Ja 27,000 169,049
Zurich Versicherungsgesellsch Sz 270 340,174
----------
692,909
----------
Nondepository Credit Institutions--(0.6%)
Acom Co., Ltd. Ja 1,000 28,943
Credit Commercial de France Fr 2,000 89,701
----------
118,644
----------
Real Estate--(3.6%)
Cheung Kong (Holdings) Ltd. HK 30,000 148,494
Hopewell Holdings HK 150,000 126,976
Land & General Holdings BHD Ma 48,000 160,459
Mayalsian Resources Corp. Ma 100,000 176,374
Sun Hung Kai Properties Ltd. HK 16,000 118,381
----------
730,684
----------
Security Brokers & Dealers--(0.8%)
Yamaichi Securities Co. Ltd. Ja 30,000 160,898
----------
Manufacturing--(30.1%)
Apparel--(1.3%)
Onward Kasiyama Co., Ltd. Ja 20,000 271,707
----------
Chemicals--(7.9%)
Akzo Nobel NV Ne 1,300 155,560
Allied Colloids Group PLC UK 40,000 78,768
Amersham International PLC UK 4,000 61,548
Bayer AG G 1,400 348,177
L'Oreal Fr 500 125,710
Nippon Sanso Corp. Ja 40,000 180,508
Reliance Industries GDS UK 2,500 44,375
Roche Holding AG Sz 40 258,424
Schering AG (a) G 2,500 174,928
Smithkline Beecham Consumer Brands PLC UK 18,000 163,309
----------
1,591,307
24
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
Country
Abbrev. Shares Value
-------- ------ ----------
Electronic & Electrical Equipment--(3.5%)
Ericsson Lm B (a) Sw 8,000 $159,636
Polygram NV Ne 5,000 295,600
Samsung Electronics GDS Ja 1,218 63,940
TDK Corp. Ja 4,000 182,398
----------
701,574
----------
Food & Kindred Products--(3.6%)
Cadbury Schweppes PLC UK 30,000 219,564
Guinness PLC UK 15,000 113,130
LVMH Moet Hennessy Louis Fr 1,500 270,530
Nestle SA Sz 120 125,276
----------
728,500
----------
Machinery & Computer Equipment--(4.4%)
BTR PLC UK 40,000 203,777
Mitsubishi Heavy Industries Ltd. Ja 30,000 204,135
NTN Corp. Ja 40,000 236,267
Toshiba Corp. Ja 40,000 253,751
----------
897,930
----------
Miscellaneous Manufacturing--(0.8%)
Atlas Copco AB, Series A Sw 12,000 166,792
----------
Paper & Paper Mills--(0.6%)
Aracruz Celulose SA, Series B Br 8,000 94,000
Indorayon (a) In 15,000 30,983
----------
124,983
----------
Petroleum Refining--(1.1%)
British Petroleum Ltd. UK 30,000 215,497
----------
Primary Metal--(0.6%)
Nippon Steel Co. Ja 34,000 110,856
----------
Printing & Publishing--(1.8%)
Singapore Press Holdings Ltd. (a) Si 12,000 179,528
Wolters Kluwer Ne 2,000 176,649
----------
356,177
----------
Stone, Clay, Glass & Concrete--(3.9%)
BPB Industries PLC UK 30,000 148,528
Compagnie de Saint Gobain Fr 1,600 193,699
Nippon Electric Glass Co. Ltd. Ja 9,900 159,055
Semen Cibinong In 25,000 78,580
UBE Industries Ltd.(a) Ja 60,000 209,805
----------
789,667
----------
Tobacco Products--(0.6%)
Hanson PLC UK 35,000 122,777
----------
Mining & Energy--(3.0%)
Crude Petroleum & Natural Gas--(1.2%)
Compagnie Francaise de Petroleum Fr 4,000 241,297
----------
Miscellaneous Metal Ores--(0.9%)
CRA Ltd. Au 13,000 $176,575
----------
Oil & Gas Extraction--(0.9%)
Repsol SA Sp 5,500 173,504
----------
Retail Trade--(3.7%)
Apparel & Accessory Stores--(0.0%)
U.S. Industries, Inc. (a) US 350 4,769
----------
Auto Dealers & Gas Stations--(0.8%)
Inchcape PLC UK 35,000 164,632
----------
Building, Hardware & Garden Supply --(1.5%)
Tostem Corp. Ja 10,000 308,328
----------
General Merchandise Stores--(0.2%)
La Rinascente SPA It 6,000 33,834
----------
Miscellaneous Retail--(1.2%)
Argos PLC UK 35,000 241,088
----------
Services--(4.9%)
Business Services--(1.8%)
Reuters Holdings PLC UK 30,000 250,416
SAP AG G 80 106,454
----------
356,870
----------
Engineering, Accounting, Research & Management--(0.6%)
United Engineers Ltd. Ma 20,000 127,153
----------
Membership Organizations--(0.9%)
Staits Steamship Land Ltd. Si 50,000 173,228
----------
Other Services--(1.6%)
VEBA Agency G 800 314,328
----------
Transportation, Communication, Electric, Gas & Sanitary Services--(17.0%)
Air Transportation--(2.6%)
British Airport Authority PLC UK 30,000 236,066
Singapore Airlines Ltd. Si 15,000 138,511
Swire Pacific Ltd., Series A HK 20,000 152,500
----------
527,077
----------
Communications--(7.6%)
British Telecommunications PLC UK 35,000 218,765
DDI Corp. Ja 40 321,323
Hong Kong Telecommunications Ltd. HK 80,000 158,187
Nippon Telegraph & Tele Corp. (a) Ja 14 117,425
PT Indosatelite ADR (a) In 6,000 229,500
Telecom Italia SPA (a) It 75,000 203,278
Telecomunicacoes Brasileiras Br 2,000 69,000
Tokyo Broadcasting System Ja 15,000 214,412
----------
1,531,890
----------
25
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
Country
Abbrev. Shares Value
-------- ------ ----------
Electric Services--(4.8%)
BBC Brown Boveri AG Sz 270 $ 280,226
Compania Naviera Perez Companc, SA ADR Ar 9,440 79,060
Korea Electric Power Corp., ADR (a) Ko 10,000 226,250
Powergen PLC UK 20,000 154,348
Seeboard PLC UK 13,500 83,735
Tokyo Electric Power Ja 5,000 153,574
----------
977,193
----------
Motor Freight & Warehousing--(2.0%)
Nippon Express Company Ltd. Ja 25,000 230,360
Toyo Wharf & Warehouse Co. Ja 44,000 171,530
----------
401,890
----------
Wholesale Trade--(6.4%)
Durable Goods--(4.9%)
C. Itoh & Company, Ltd. Ja 40,000 233,904
Canon Sales Ja 9,000 249,852
China Steel Corp. GDR (a) Tw 11,000 232,430
Mabuchi Motor Co. Ja 4,000 275,960
Samsung Electronics GDS (a) Ja 98 5,156
----------
997,302
----------
Nondurable Goods--(1.5%)
Rothmans International PLC (b) UK 31,000 304,486
----------
Total Common Stocks
(Cost $19,015,813) 18,955,055
----------
Currency
Abbrev. Par Value
-------- --- -----
Corporate fixed-income bonds--(0.6%)
Manufacturing--(0.6%)
Electronic & Electrical Equipment
Daewoo Electron Convertible
3.500% 12/31/07 (cost
$167,625) Ko 100,000 $ 118,500
---------
Country
Abbrev. Shares
-------- ------
Warrants (a)--(0.0%)
Five Arrows Chile
Investment Trust,
(expires 08/30/95) Ch 8,000 5,280
Thai Euro Fund,
(expires 03/31/98) Th 1,600 5,600
--------
Total Warrants
(Cost $9,043) 10,880
--------
Total
Investments--(94.5%)
(Cost $19,192,481) (c) 19,084,435
--------
Par
---
Short-term obligations--(5.0%)
Repurchase agreement with Lehman
Government Securities, Inc.,
dated 6/30/95, due 7/03/95 at 6.210%,
collateralized by U.S. Treasury
bills and notes with various maturities to
1999, market value $1,035,234
(repurchase proceeds
$1,013,524) $1,013,000 1,013,000
---------
Forward Currency Contracts
(d)--(-0.2)% (33,259)
Other Assets &
Liabilities--Net--(0.7%) 124,390
---------
Net Assets--(100.0%) $20,188,566
=========
Notes to investment portfolio:
(a) Non-income producing.
(b) Each unit consists of 1 share of United Kingdom Rothmans International and 1
share of Netherlands Rothmans International.
(c) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $1,224,073
Gross unrealized depreciation 1,332,119
---------
Net unrealized depreciation $ (108,046)
=========
(Notes to investment portfolio continued on next page)
See Notes to Investment Portfolio.
26
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
(d) As of June 30, 1995, the Fund had entered into the following forward
currency exchange contracts resulting in net unrealized depreciation of
$33,259.
INVESTMENT PORTFOLIO (Continued)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
Net Unrealized
Appreciation
Contracts to In Exchange Settlement (Depreciation)
Deliver For Date (U.S.$)
------------ ----------- -------- --------------
DEM 440,000 USD 312,500 10/27/95 $ (7,312)
FRF 2,800,000 USD 562,916 10/27/95 (13,852)
JPY 350,000,000 USD 4,201,681 10/27/95 232
NG 500,000 USD 317,460 10/27/95 (7,393)
SF 380,000 USD 329,004 10/27/95 (4,934)
------------
$(33,259)
============
Acronym Name
---------- -----------------------------
ADR American Depository Receipt
GDR Global Depository Receipt
GDS Global Depository Shares
Summary of Securities by Country/Currency
Country/ % of Total
Currency Securities
Country Abbrev. Value at Value
----------------- ------ ---------- ----------
Japan Ja/JPY $ 5,257,436 27.5%
United Kingdom UK 3,911,431 20.5%
France Fr/FRF 1,251,894 6.6%
Germany G 1,045,262 5.5%
Switzerland Sz/SF 1,004,100 5.3%
Netherlands Ne/NG 923,409 4.8%
Hong Kong HK 902,288 4.7%
Korea Ko 605,427 3.2%
Singapore Si 605,083 3.2%
Malaysia Ma 564,888 3.0%
Spain Sp 477,996 2.5%
Indonesia In 376,108 2.0%
Sweden Sw 326,428 1.7%
Taiwan Tw 288,080 1.5%
Thailand Th 275,600 1.4%
Denmark De 250,255 1.3%
Italy It 237,112 1.2%
Australia Au 229,799 1.2%
Chile Ch 208,280 1.1%
Brazil Br 163,000 0.9%
Argentina Ar 79,060 0.4%
Turkey Tu 70,980 0.4%
Mexico Mx 25,750 0.1%
United States US/USD 4,769 0.0%
-------- --------
$19,084,435 100.0%
======== ========
Certain securities are listed by country of underlying exposure but may trade
predominantly on other exchanges.
See Notes to Financial Statements.
27
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth / June 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Assets:
Investments, at market value (Identified cost $19,192,481) $19,084,435
Short-term obligations 1,013,000
Cash (including foreign currencies) 181,178
Receivable for investments sold 381,101
Receivable for fund shares sold 8,850
Dividends and interest receivable 107,424
Unamortized organization expenses 16,933
Other assets 1,251
----------
Total assets 20,794,172
----------
Liabilities:
Payable for investments purchased 477,796
Payable for fund shares repurchased 14,393
Payable for foreign currency contracts 33,259
Management fee payable 30,149
Accrued expenses payable 48,168
Other liabilities 1,841
----------
Total liabilities 605,606
----------
Net assets $20,188,566
==========
Net assets represented by:
Paid-in capital $21,850,541 Accumulated undistributed net investment income
129,270 Accumulated net realized losses on investments and foreign currency
transactions (1,642,907) Net unrealized depreciation on investments and foreign
currency transactions (148,338)
----------
Total net assets applicable to outstanding shares of beneficial interest $20,188,566
==========
Shares of beneficial interest outstanding 11,133,741
==========
Net asset value per share $1.81
==========
</TABLE>
STATEMENT OF OPERATIONS (Unaudited)
Six Months Ended June 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Investment income:
Dividends (net of foreign taxes withheld) $ 229,011
Interest income 42,018
--------
Total investment income 271,029
--------
Expenses:
Management fee 85,350
Bookkeeping fee 13,500
Transfer agent fee 3,714
Custodian fee 28,267
Audit fees 16,342
Trustees' expense 4,154
Amortization of organization expense 2,751
Legal expense 369
Miscellaneous expense 371
--------
Total expenses 154,818
--------
Net investment income 116,211 Realized and unrealized gains (losses) on
investments and foreign currency transactions:
Net realized losses on investments (758,811)
Net realized losses on foreign currency transactions (827,560)
Change in unrealized appreciation on investments and foreign currency transactions 775,416
--------
Net decrease in net assets resulting from operations $(694,744)
========
</TABLE>
See Notes to Financial Statements.
28
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport International Fund for
Growth
<TABLE>
<CAPTION>
(Unaudited)
Six Months Period
Ended Ended
June 30, December 31,
1995 1994*
---------- ------------
<S> <C> <C>
Operations:
Net investment income $ 116,211 $ 13,075
Net realized losses on investments (758,811) (21,586)
Net realized losses on foreign currency transactions (827,560) (199,438)
Change in unrealized appreciation (depreciation) on investments and
foreign currency transactions 775,416 (923,754)
-------- ----------
Net decrease in net assets resulting from operations (694,744) (1,131,703)
-------- ----------
Fund share transactions:
Proceeds from fund shares sold 4,238,919 21,072,283
Cost of fund shares repurchased (2,501,579) (794,610)
-------- ----------
Net increase in net assets resulting from fund share transactions 1,737,340 20,277,673
-------- ----------
Total increase in net assets 1,042,596 19,145,970
Net assets:
Beginning of period 19,145,970 0
-------- ----------
End of period $20,188,566 $19,145,970
======== ==========
Accumulated undistributed net investment income included in ending net assets $ 129,270 $ 13,059
======== ==========
Analysis of changes in shares of beneficial interest:
Shares sold 2,359,918 10,578,046
Shares redeemed (1,396,144) (408,079)
-------- ----------
Net increase 963,774 10,169,967
======== ==========
</TABLE>
* For the period from the commencement of operations May 2, 1994 to December
31, 1994.
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport International Fund for Growth
<TABLE>
<CAPTION>
(Unaudited)
Six
Months Period
Ended Ended
June 30, December 31,
1995 1994***
-------- -------------
<S> <C> <C>
Per share operating performance:
Net asset value, beginning of period $ 1.88 $ 2.00
------ -----------
Net investment income 0.01 --
Net realized and unrealized losses on investments and foreign currency
transactions (0.08) (0.12)
------ -----------
Total from investment operations (0.07) (0.12)
------ -----------
Net asset value, end of period $ 1.81 $ 1.88
====== ===========
Total return:
Total investment return (3.72)%* (6.00)%*
Ratios/supplemental data:
Net assets, end of period (000) $20,189 $19,146
Ratio of net expenses to average net assets 1.63%** 1.74%**
Ratio of net investment income to average net assets 1.22%** 0.13%**
Portfolio turnover ratio 43%** 31%*
</TABLE>
* Not Annualized
** Annualized
*** For the period from the commencement of operations May 2, 1994 to December
31, 1994.
See Notes to Financial Statements.
29
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund /
June 30, 1995
Par Value
------ --------
BONDS & NOTES(a)--(87.0)%
Corporate fixed-income bonds & notes--(36.9%)
Construction--(1.2%)
Building Construction--(1.2%)
USG Corp., 9.250% 09/15/01 $250,000 $ 256,250
------
Finance, Insurance & Real Estate--(1.1%)
Insurance Carriers--(1.1%)
Reliance Group Holdings, 9.000% 11/15/00 250,000 245,625
------
Manufacturing--(13.2%)
Chemicals--(4.0%)
Agricultural Minerals Co., LP, 10.750% 09/30/03 200,000 205,500
Huntsman Corp., 11.000% 04/15/04 200,000 218,500
N.L. Industries, Inc., 11.750% 10/15/03 250,000 260,625
Revlon Worldwide, (b) 03/15/98 250,000 171,250
------
855,875
------
Electronic & Electric Equipment--(1.2%)
Exide Corp., 10.750% 12/15/02 250,000 264,375
------
Lumber & Wood Products--(1.2%)
Triangle Pacific Corp., 10.500% 08/01/03 250,000 254,375
------
Miscellaneous Manufacturing--(1.9%)
American Standard Co., (b) 06/01/05 350,000 266,000
Coleman Holdings Co., Series B, (b) 05/27/98 200,000 147,000
------
413,000
------
Paper Products--(1.2%)
Stone Container Corp., 9.875% 02/01/01 250,000 247,813
------
Primary Metal--(2.0%)
A.K. Steel Corp., 10.750% 04/01/04 250,000 262,500
Magma Copper Co., 12.000% 12/15/01 150,000 165,750
------
428,250
------
Printing & Publishing--(0.7%)
American Media Operations Inc., 11.625% 11/15/04 150,000 160,500
------
Stone, Clay, Glass & Concrete--(1.0%)
Owens-Illinois Inc., 10.500% 06/15/02 200,000 207,500
------
Mining & Energy--(4.7%)
Crude Petroleum & Natural Gas--(2.4%)
Ferrellgas Finance Corp., L.P., 10.000% 08/01/01 250,000 260,000
Triton Energy Corp., (b) 11/01/97 300,000 244,500
------
504,500
------
Oil & Gas Extraction--(2.3%)
Gulf Canada Resources Ltd., 9.250% 01/15/04 $250,000 $ 243,750
Santa Fe Energy Resources, Inc., 11.000% 05/15/04 225,000 238,500
------
482,250
------
Retail Trade--(2.1%)
Food Stores--(1.1%)
Pathmark Stores, Inc., 9.625% 05/01/03 250,000 243,750
------
Miscellaneous Retail--(1.0%)
Thrifty Payless Holdings, Inc., 11.750% 04/15/03 200,000 211,000
------
Services--(6.9%)
Amusement & Recreation--(1.1%)
Bally's Grand, Inc., Series B, 10.375% 12/15/03 250,000 243,750
------
Health Services--(4.7%)
Cb Tenet Healthcare Corp., 10.125% 03/01/05 250,000 264,063
Hillhaven Corp., 10.125% 09/01/01 200,000 208,000
Integrated Health Services, Inc., 10.750% 07/15/04 250,000 266,250
OrNda Healthcorp., 11.375% 08/15/04 250,000 273,125
------
1,011,438
------
Hotels, Camps & Lodging--(1.1%)
HMH Properties Inc., 9.500% 05/15/05 250,000 241,875
------
Transportation, Communication, Electric,
Gas & Sanitary Services--(6.9%)
Communications--(5.7%)
Cablevision Systems Corp., 10.750% 04/01/04 250,000 262,500
Continental Cablevision, Inc., 11.000% 06/01/07 250,000 277,500
NWCG Holdings Corp., (b) 06/15/99 425,000 263,500
SCI Television, Inc., 11.000% 06/30/05 250,000 261,250
Young Broadcasting, 11.750% 11/15/04 150,000 163,500
------
1,228,250
------
Motor Freight & Warehousing--(1.2%)
Trism, Inc., 10.750% 12/15/00 250,000 246,250
------
Wholesale Trade--(0.8%)
Nondurable Goods--(0.8%)
SD Warren Co. 12.000% 12/15/04 150,000 162,000
Total Corporate Fixed-Income Bonds & Notes (Cost $7,650,793) 7,908,626
------
30
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund /
June 30, 1995
Par Value
---- ------
Corporate convertible bonds & notes--(1.3%)
Transportation, Communication, Electric,
Gas & Sanitary Services--(1.3%)
Communications--(1.3%)
Bell Cablemedia PLC, (b)
07/15/04 (Cost $250,058) $ 400,000 $ 269,500
------
U.S. government bonds--(22.7%)
U.S. Treasury Notes, 11.875%
11/15/2003 (Cost $4,472,234) 3,565,000 4,857,883
------
Currency
Abbrev.
------
Foreign government bonds--(26.1%)
Deutschland Rep., 9.000% 01/22/01 DM 1,440,000 1,155,542
Kingdom of Denmark, 9.000% 11/15/00 DK 10,563,000 2,029,380
Treasury Corp. of Victoria, 12.000%
09/22/01 A$ 1,369,000 1,105,181
United Kingdom Treasury, 9.750% 08/27/02 KB 768,000 1,308,766
---------
Total Foreign Government Obligations
(Cost $5,304,345) 5,598,870
---------
Total Investments--(87.0%)
(Cost $17,677,430) (c) $18,634,879
---------
Par Value
--------- -----------
Short-term obligations--(9.9%)
Repurchase agreement
with Lehman Government Securities, Inc.,
dated 6/30/95, due 07/03/95 at 6.210%
collateralized by U.S. Treasury bills
and notes with various maturities to
1999, market value $2,165,509 (repurchase
proceeds $2,120,097). $2,119,000 $ 2,119,000
---------
Forward currency contracts (d) 0.1% 14,958
Other Assets & Liabilities--Net--(3.0%) 661,251
---------
Net Assets--(100.0%) $21,430,088
=========
Notes to investment portfolio:
(a) Par of each bond or note is shown in its issued currency according
to the abbreviations shown below. Value of all securities is shown in
U.S. dollars.
(b) Zero coupon bond.
(c) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $959,989
Gross unrealized depreciation (2,540)
-------
Net unrealized appreciation $957,449
=======
(d) As of June 30, 1995, the Fund had entered into the following forward
currency exchange contracts resulting in net unrealized appreciation of
$14,958.
Net unrealized
Contracts In exchange Settlement appreciation
to deliver for date (US $)
----------- --------------- -------- --------------
A$ 532,000 USD 370,868 7/12/95 6,485
A$ 532,000 USD 368,754 7/19/95 8,473
------------
$14,958
============
Summary of Securities by Currency
% of Total
Currency Securities
Country Abbrev. Value at Value
---------------- ------ ---------- ----------
United States $13,036,009 70.0%
Denmark DK 2,029,380 10.9%
United Kingdom UK 1,308,766 7.0%
Germany DM 1,155,543 6.2%
Australia A$ 1,105,181 5.9%
-------- --------
$18,634,879 100.0%
======== ========
Certain securities are listed by country of underlying exposure but may trade
predominantly on other exchanges.
See Notes to Financial Statements.
31
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund /
June 30, 1995
Assets:
Investments, at market value (Identified cost $17,677,430) $18,634,879
Short-term obligations 2,119,000
Dividends and interest receivable 446,260
Receivable for investments sold 265,111
Receivable for fund shares sold 22,569
Receivable for foreign currency contracts 14,958
Receivable from manager 10,709
Unamortized organization expenses 16,200
Other assets 1,580
----------
Total assets 21,531,266
----------
Liabilities:
Payable for fund shares repurchased 45,716
Management fee payable 22,205
Accrued expenses payable 33,257
----------
Total liabilities 101,178
----------
Net assets $21,430,088
==========
Net assets represented by:
Paid-in capital $19,899,583
Accumulated undistributed net investment income 727,661
Accumulated net realized losses on investments and
foreign currency transactions (175,332)
Net unrealized appreciation on investments and foreign
currency transactions 978,176
----------
Total net assets applicable to outstanding shares of
beneficial interest $21,430,088
==========
Shares of beneficial interest outstanding 1,971,302
==========
Net asset value per share $10.87
==========
STATEMENT OF OPERATIONS (Unaudited)
Six months ended June 30, 1995
Investment income:
Interest income $ 821,207
--------
Expenses:
Management fee 56,900
Bookkeeping fee 12,920
Transfer agent fee 3,750
Audit fees 22,122
Legal fee 369
Printing expense 2,668
Amortization of organization expense 2,411
Trustees' expense 1,727
Miscellaneous expense 845
--------
Total expenses 103,712
--------
Less:
Expenses reimbursable by Manager (23,195)
--------
Net expenses 80,517
--------
Net investment income 740,690
Realized and unrealized gains (losses) on investments and
foreign currency transactions:
Net realized losses on investments (55,660)
Net realized gains on foreign currency transactions 11,651
Change in unrealized appreciation on investments and
foreign currency transactions 1,132,978
--------
Net increase in net assets resulting from operations $1,829,659
========
See Notes to Financial Statements.
32
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund
<TABLE>
<CAPTION>
(Unaudited)
Six months Period
Ended Ended
June 30, December 31,
1995 1994*
---------- ------------
<S> <C> <C>
Operations:
Net investment income $ 740,690 $ 409,250
Net realized losses on investments (55,660) (131,439)
Net realized gains on foreign currency transactions 11,651 2,133
Change in unrealized appreciation (depreciation) on investments and foreign
currency transactions 1,132,978 (154,802)
-------- ----------
Net increase in net assets resulting from operations 1,829,659 125,142
-------- ----------
Distributions declared from:
Net investment income -- (409,250)
Distributions in excess of net investment income -- (1,787)
Distributions in excess of net realized gains on investments -- (13,259)
-------- ----------
Total distributions -- (424,296)
-------- ----------
Fund share transactions:
Proceeds from fund shares sold 7,630,060 13,468,257
Cost of fund shares repurchased (1,371,772) (251,258)
Distributions reinvested -- 424,296
-------- ----------
Net increase in net assets resulting from fund share transactions 6,258,288 13,641,295
-------- ----------
Total increase in net assets 8,087,947 13,342,141
Net assets:
Beginning of period 13,342,141 0
-------- ----------
End of period $21,430,088 $13,342,141
======== ==========
Accumulated undistributed (overdistributed) net investment income included
in ending net assets $ 727,661 $ (13,029)
======== ==========
Analysis of changes in shares of beneficial interest:
Shares sold 739,443 1,344,428
Shares redeemed (130,682) (25,182)
Distributions reinvested -- 43,296
-------- ----------
Net increase 608,761 $ 1,362,542
======== ==========
</TABLE>
* For the period from the commencement of operations July 5, 1994 to December
31, 1994.
See Notes to Financial Statements.
33
<PAGE>
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport Strategic Income Fund
<TABLE>
<CAPTION>
(Unaudited)
Six months Period
Ended Ended
June 30, December 31,
-------- -------------
1995 1994***
-------- -------------
<S> <C> <C>
Per share operating performance:
Net asset value, beginning of period $ 9.79 $10.00
------ -----------
Net investment income 0.43 0.30
Net realized and unrealized gains (losses) on investments and foreign
currency transactions 0.65 (0.19)
------ -----------
Total from investment operations 1.08 0.11
------ -----------
Less distributions:
Dividends from net investment income -- (0.31)
Distributions from net realized gains on investments -- (0.01)
------ -----------
Total distributions -- (0.32)
------ -----------
Net asset value, end of period $10.87 $ 9.79
====== ===========
Total return:
Total investment return (a) 11.03%* 1.10%**
Ratios/supplemental data:
Net assets, end of period (000) $21,430 $13,342
Ratio of net expenses to average net assets (b) 0.91%* 1.00%*
Ratio of net investment income to average net assets (a) 8.37%* 7.33%*
Portfolio turnover ratio 36%* 94%**
</TABLE>
* Annualized
** Not Annualized
*** For the period from the commencement of operations July 5, 1994 to December
31, 1994.
(a) If the Fund had paid all of its expenses and there had been no reimbursement
from the Manager, as described in Note 5, these ratios would have been 1.17%
(annualized) and 1.60% (annualized), respectively.
(b) Computed giving effect to Manager's expense limitation undertaking.
See Notes to Financial Statements.
34
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth /
June 30, 1995
Shares Value
----- ------------
Common Stocks--(97.9%)
Construction--(0.8%)
Heavy Construction Non-Building Construction--(0.8%)
Halliburton Co. $
7,600 271,700
----------
Finance, Insurance & Real Estate--(11.8%)
Depository Institutions--(5.7%)
Banc One Corp. 5,500 177,375
Bank of New York Co., Inc. 10,000 403,750
BankAmerica Corp. 5,100 268,388
First Bank System, Inc. 1,700 69,700
First Union Corp. 2,800 126,700
NBD Bancorp, Inc. 10,700 342,400
Star Banc Corp. 3,200 147,200
Suntrust Banks, Inc. 3,300 192,225
Wachovia Corp. 1,000 35,750
----------
1,763,488
----------
Holding & Other Investment Companies--(0.3%)
Medicine Shoppe International, Inc. 2,000 84,300
----------
Insurance Carriers--(3.5%)
Aflac, Inc. 4,600 201,250
American General Corp. 11,100 374,625
Chubb Corp. 2,400 192,300
Cigna Corp. 1,400 108,675
GEICO Corp. 3,800 215,175
----------
1,092,025
----------
Nondepository Credit Institutions--(0.4%)
Federal Home Loan Mortgage 400 27,500
Green Tree Financial Corp. 900 39,938
Loews Corp. 500 60,500
----------
127,938
----------
Security Brokers & Dealers--(1.9%)
Bear Stearns Co., Inc. 3,300 70,538
Franklin Resources, Inc. 11,200 498,400
----------
568,938
----------
Manufacturing--(54.8%)
Chemicals--(13.2%)
ARCO Chemical Co. 1,200 54,450
Abbott Laboratories 1,700 68,850
Bristol-Myers Squibb Co. 12,600 858,375
Clorox Co. 4,600 300,150
E.I. DuPont De Nemours & Co., Inc. 7,000 460,625
Goodrich (B.F.) Co. 1,100 58,988
Johnson & Johnson 12,700 858,838
Lubrizol Corp. 8,300 293,613
Merck & Co., Inc. 12,600 617,400
Morton International, Inc. 5,300 155,025
Mylan Laboratories 7,400 $227,550
Sherwin-Williams Co. 3,400 121,125
----------
4,074,989
----------
Electronic & Electrical Equipment--(4.0%)
General Electric Co. 4,600 259,325
Intel Corp. 12,800 810,400
Texas Instruments, Inc. 1,200 160,650
----------
1,230,375
----------
Fabricated Metal--(1.3%)
Newell Co. 16,200 396,900
----------
Food & Kindred Products--(7.5%)
Adolph Coors Co., Class B 2,000 32,750
Archer Daniels Midland Co. 12,500 232,813
CPC International, Inc. 5,300 327,275
Campbell Soup Co. 3,300 161,700
Coca-Cola Co. 9,900 631,125
Heinz (H.J.) Co. 6,200 275,125
Kellogg Co. 2,700 192,712
PepsiCo, Inc. 2,200 100,375
Phillip Morris Co., Inc. 2,800 208,250
Sara Lee Corp. 5,500 156,750
----------
2,318,875
---------
Furniture & Fixtures--(0.7%)
Leggett & Platt, Inc. 4,800 211,200
---------
Machinery & Computer Equipment--(6.3%)
Brunswick Corp. 1,400 23,800
Diebold, Inc. 500 21,750
Dover Corp. 3,700 269,175
Hewlett-Packard Co. 10,500 782,250
International Business Machine Corp. 6,000 576,000
Pall Corp. 6,900 153,525
Timken Co. 2,400 110,700
---------
1,937,200
---------
Measuring & Analyzing Instruments--(6.1%)
Baxter International, Inc. 700 25,463
Emerson Electric Co. 9,400 672,100
Johnson Controls, Inc. 5,900 333,350
Litton Industries, Inc. 900 33,188
Millipore Corp. 8,800 594,000
Raytheon Co. 3,000 232,875
---------
1,890,976
---------
Miscellaneous Manufacturing--(0.0%)
Cross (A.T.) Co. 200 2,975
---------
Paper & Paper Mills--(2.1%)
Champion International Corp. 4,900 255,413
Longview Fibre Co. 12,000 204,000
Union Camp Corp. 2,300 133,113
Westvaco Corp. 1,000 44,250
---------
636,776
See Notes to Investment Portfolio.
35
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth /
June 30, 1995
Shares Value
------ -----
Petroleum Refining--(8.0%)
Amoco Corp. 5,600 $ 373,100
Atlantic Richfield Co. 5,900 647,525
Exxon Corp. 16,100 1,137,063
Mobil Corp. 3,100 297,600
----------
2,455,288
----------
Primary Metal--(0.5%)
Aluminum Co. of America 400 20,050
Worthington Industries, Inc. 6,300 128,754
----------
148,804
----------
Printing & Publishing--(2.0%)
Gannett Co., Inc. 4,400 238,700
Knight-Ridder, Inc. 500 28,438
McGraw-Hill Cos., Inc. 400 30,350
Tribune Co. 5,200 319,150
----------
616,638
----------
Stone, Clay, Glass & Concrete--(0.1%)
Southdown, Inc. 1,500 28,688
----------
Tobacco Products--(0.0%)
UST, Inc. 400 11,900
----------
Transportation Equipment--(3.0%)
Allied Signal, Inc. 6,600 293,700
Echlin, Inc. 2,100 72,975
General Dynamics Corp. 4,400 195,250
PACCAR, Inc. 7,700 359,975
----------
921,900
----------
Retail Trade--(6.7%)
Food Stores--(0.8%)
Albertson's, Inc. 8,400 249,900
----------
General Merchandise Stores--(2.3%)
Sears, Roebuck & Co. 12,000 718,500
----------
Home Furnishings & Equipment--(1.3%)
Circuit City Stores, Inc. 12,200 385,825
----------
Miscellaneous Retail--(1.8%)
Walgreen Co. 11,000 551,375
----------
Restaurants--(0.5%)
Luby's Cafeterias, Inc. 4,600 92,575
McDonald's Corp. 1,800 70,425
----------
163,000
----------
Services--(4.5%)
Amusement & Recreation--(0.8%)
Walt Disney Co. 4,700 261,438
----------
Business Services--(3.5%)
Automatic Data Processing Inc. 6,500 408,688
Ecolab, Inc. 4,200 102,900
Equifax, Inc. 1,000 33,375
Honeywell, Inc. 2,800 120,750
Interpublic Group of Co., Inc. 4,000 150,000
Kelly Services, Inc., Class A 1,900 48,925
Oracle Systems Corp. 5,900 $ 227,888
----------
1,092,526
----------
Hotels, Camps & Lodging--(0.2%)
Hilton Hotels Corp. 800 56,200
----------
Transportation, Communication, Electric,
Gas and Sanitary Services--(18.7%)
Air Transportation--(0.9%)
AMR Corp. 2,100 156,713
Delta Air Lines, Inc. 1,600 118,000
----------
274,713
----------
Communications--(9.1%)
Ameritech Corp. 13,300 585,200
Bell Atlantic Corp. 2,700 151,200
BellSouth Corp. 3,100 196,850
Capital Cities ABC, Inc. 5,100 550,800
Century Telephone Enterprises 3,800 107,825
GTE Corp. 3,800 129,675
Southwestern Bell Corp. 12,700 604,838
Sprint Corp. 14,000 470,750
----------
2,797,138
----------
Electric Services--(3.6%)
Central & South West Corp. 10,900 286,125
Consolidated Edison Co. of
New York 7,900 233,050
Delmarva Power & Light Co. 300 6,150
NIPSCO Industries, Inc. 1,100 37,400
Ohio Edison Co. 15,900 359,735
Rochester Gas & Electric Corp. 3,200 68,000
San Diego Gas & Electric Co. 5,600 116,200
----------
1,106,660
----------
Gas Services--(2.4%)
Pacific Enterprises 6,000 147,000
Panhandle Eastern Corp. 3,000 78,000
Williams Companies, Inc. 14,900 519,635
----------
744,635
----------
Railroad--(1.2%)
Illinois Central Corp. 11,100 382,950
----------
Sanitary Services--(1.2%)
Browning Ferris Industries, Inc. 8,300 299,835
Piedmont Natural Gas Co. 2,900 60,175
----------
360,010
----------
Water Transportation--(0.3%)
Tidewater, Inc. 3,600 90,450
----------
Wholesale Trade--(0.6%)
Durable Goods--(0.5%)
Genuine Parts Co. 3,100 117,413
Wyle Electronics Co. 1,200 33,750
----------
151,163
----------
Nondurable Goods--(0.1%)
Sysco Corp. 1,300 38,350
----------
Total Investments (Cost $26,985,636) (a) 30,216,706
----------
See Notes to Investment Portfolio.
36
<PAGE>
SCHEDULE OF INVESTMENTS (Continued)
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth /
June 30, 1995
Par Value
--------- ------------
Short-term obligations--(5.4%)
Repurchase agreement with
Lehman Government Securities, Inc.,
dated 06/30/95, due 07/03/95 at 6.210%,
collateralized by U.S. Treasury bills
and notes with various maturities to
1999, market value $1,703,588
(repurchase proceeds
$1,667,863) $1,667,000 $ 1,667,000
----------
Other Assets & Liabilities--Net--(-3.3%) (1,004,483)
----------
Net Assets--(100%) $30,879,223
==========
Notes to investment portfolio:
(a) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $3,359,131
Gross unrealized depreciation (128,061)
---------
Net unrealized appreciation $3,231,070
=========
See Notes to Financial Statements.
37
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth /
June 30, 1995
Assets:
Investments, at market value (Identified cost $26,985,636) $30,216,706
Short-term obligations 1,667,000
Receivable for investments sold 553,293
Receivable for fund shares sold 30,730
Dividends and interest receivable 65,436
Receivable from manager 6,803
Unamortized organization expenses 16,173
Other assets 1,779
----------
Total assets 32,557,920
----------
Liabilities:
Payable for investments purchased 1,585,218
Payable for fund shares repurchased 24,082
Management fee payable 37,812
Accrued expenses payable 31,585
----------
Total liabilities 1,678,697
----------
Net assets $30,879,223
==========
Net assets represented by:
Paid-in capital $26,993,617
Accumulated undistributed net investment income 181,389
Accumulated net realized gains on investments 473,147
Net realized appreciation on investments 3,231,070
----------
Total net assets applicable to outstanding shares of
beneficial interest $30,879,223
==========
Shares of beneficial interest outstanding 2,544,347
==========
Net asset value per share $12.14
==========
STATEMENT OF OPERATIONS (Unaudited)
Six months ended June 30, 1995
Investment income:
Dividends $ 282,735
Interest income 40,807
--------
Total investment income 323,542
--------
Expenses:
Management fee 88,445
Bookkeeping fee 13,500
Transfer agent fee 3,750
Audit fees 19,106
Custodian fee 1,440
Printing expense 2,668
Amortization of organization expense 2,364
Trustees' expense 1,739
Legal fee 369
Miscellaneous expense 2,733
--------
Total expenses 136,114
--------
Less:
Expenses reimbursable by Manager (23,125)
--------
Net expenses 112,989
--------
Net investment income 210,553 Realized and unrealized gains on investments:
Net realized gains on investments 517,051
Change in unrealized appreciation on investments 2,936,831
--------
Net increase in net assets resulting from operations $3,664,435
========
See Notes to Financial Statements.
38
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth
<TABLE>
<CAPTION>
(Unaudited)
Six Months Period
Ended Ended
June 30, December 31,
1995 1994*
---------- ------------
<S> <C> <C>
Operations:
Net investment income $ 210,553 $ 130,873
Net realized gains on investments 517,051 43,388
Change in unrealized appreciation on investments 2,936,831 294,239
-------- ----------
Net increase in net assets resulting from operations 3,664,435 468,500
-------- ----------
Distributions declared from:
Net investment income -- (130,873)
In excess of net investment income -- (29,164)
Net realized gains on investments -- (43,388)
In excess of net realized gains on investments -- (43,904)
-------- ----------
Total distributions -- (247,329)
-------- ----------
Fund share transactions:
Proceeds from fund shares sold 13,768,723 15,205,777
Cost of fund shares repurchased (1,926,538) (301,674)
Distributions reinvested -- 247,329
-------- ----------
Net increase in net assets resulting from fund share transactions 11,842,185 15,151,432
-------- ----------
Total increase in net assets 15,506,620 15,372,603
Net assets:
Beginning of period 15,372,603 0
-------- ----------
End of period $30,879,223 $15,372,603
======== ==========
Accumulated undistributed (overdistributed) net investment income included in
ending net assets $ 181,389 $ (29,164)
======== ==========
Analysis of changes in shares of beneficial interest:
Shares sold 1,217,882 1,501,690
Shares redeemed (170,435) (28,803)
Distributions reinvested -- 24,013
-------- ----------
Net increase 1,047,447 1,496,900
======== ==========
</TABLE>
* For the period from the commencement of operations July 5, 1994 to December
31, 1994.
See Notes to Financial Statements.
39
<PAGE>
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Colonial-Keyport U.S. Fund for Growth
<TABLE>
<CAPTION>
(Unaudited)
Six Months Period
Ended Ended
June 30, December 31,
-------- ------------
1995 1994***
-------- ------------
<S> <C> <C>
Per share operating performance:
Net asset value, beginning of period $10.27 $10.00
------ ----------
Net investment income 0.08 0.09
Net realized and unrealized gains on investments 1.79 0.35
------ ----------
Total from investment operations 1.87 0.44
------ ----------
Less distributions:
Dividends from net investment income -- (0.11)
Distributions from net realized gains on investments -- (0.06)
------ ----------
Total Distributions -- (0.17)
------ ----------
Net asset value, end of period $12.14 $10.27
====== ==========
Total return:
Total investment return (a) 18.31%** 4.40%**
Ratios/supplemental data:
Net assets, end of period (000) $30,879 $15,373
Ratio of net expenses to average net assets (b) 1.00%* 1.00%*
Ratio of net investment income to average net assets (a) 1.88%* 2.16%*
Portfolio turnover ratio 85%* 52%**
</TABLE>
* Annualized
** Not Annualized
*** For the period from the commencement of operations July 5, 1994 to
December 31, 1994
(a) Computed giving effect to Manager's expense limitation undertaking.
(b) If the Fund had paid all of its expenses and there had been no reimbursement
from the Manager, as described in Note 5, these ratios would have been 1.22%
(annualized) and 1.64% (annualized), respectively.
See Notes to Financial Statements.
40
<PAGE>
SCHEDULE OF INVESTMENTS (Unaudited)
Keyport Variable Investment Trust Newport-Keyport Tiger Fund / June 30, 1995
Country
Abbrev. Shares Value
------ --------- -----------
COMMON STOCKS--(80.9%)
Finance, Insurance & Real Estate--(38.9%)
Depository Institutions--(19.2%)
Development Bank of Singapore Ltd. Si 54,000 $ 614,603
Hang Seng Bank HK 83,600 637,450
HSBC Holdings PLC HK 46,200 592,599
Oversea Chinese Banking Si 31,000 343,951
Public Bank Bhd Ma 105,000 234,721
---------
2,423,324
---------
Holding & Other Investment Companies--(5.2%)
Citic Pacific Ltd. (a) HK 126,000 316,722
Shun Tak Holdings Ltd. HK 316,000 251,160
Taiwan Fund, Inc. US 4,200 91,876
---------
659,758
---------
Nondepository Credit Institutions--(1.1%)
Manhattan Card Co., Ltd. HK 340,000 138,413
---------
Real Estate--(11.0%)
Cheung Kong Holdings Ltd. HK 78,000 386,084
City Developments Ltd. Si 65,000 397,817
Sun Hung Kai Properties Ltd. HK 49,000 362,543
Wharf Holdings HK 77,000 251,270
---------
1,397,714
---------
Security Brokers & Dealers--(2.4%)
Guoco Group Ltd. HK 66,000 307,921
---------
Manufacturing--(11.9%)
Apparel--(1.5%)
Giordano International Ltd. HK 258,000 191,724
---------
Chemicals--(0.9%)
PT Kalbe Farma In 25,500 116,793
---------
Fabricated Metal--(2.2%)
Kian Joo Can Factory Bhd Ma 72,000 282,034
---------
Food & Kindred Products--(2.0%)
PT Mayora Indah In 53,500 245,036
---------
Machinery & Computer Equipment--(1.2%)
PT Modern Photo Film (a) In 28,500 154,848
---------
Petroleum Refining--(1.4%)
Nylex Malaysia Bhd Ma 58,000 179,614
---------
Printing & Publishing--(2.7%)
Singapore Press Holdings Ltd. Si 22,800 341,102
---------
Retail Trade--(4.6%)
Auto Dealers & Gas Stations--(4.6%)
Cycle & Carriage Ltd. Si 65,000 581,603
---------
Services--(6.5%)
Hotels, Camps & Lodging--(4.0%)
Genting Berhad Ma 51,000 504,143
---------
Miscellaneous Repair Services--(2.5%)
Keppel Corp. (a) Si 38,000 310,093
---------
Transportation, Communication, Electric,
Gas & Sanitary Services--(16.1%)
Air Transportation--(3.1%)
Swire Pacific Ltd., Series A HK 52,000 396,500
---------
Communications--(6.2%)
Hong Kong Telecommunications Ltd. HK 184,400 $ 364,620
Philippine Long Distance Telephone, ADR US 1,700 121,975
Telekom Malaysia Bhd Ma 39,000 295,939
---------
782,534
---------
Electric Services--(2.7%)
Hong Kong Electric Holdings Ltd. HK 98,000 333,096
---------
Gas Services--(4.1%)
Hong Kong and China Gas Co., Ltd. HK 326,000 520,323
---------
WHOLESALE TRADE--(2.9%)
Durable Goods--(2.9%)
China Steel Corp., GDR (a) US 2,000 42,260
Sime Barby Bhd Ma 117,000 326,333
---------
368,593
---------
Total Investments
(Cost $9,356,000) (b) 10,235,166
---------
Par
-------
SHORT-TERM OBLIGATIONS--(18.5%)
Repurchase agreement with Lehman
Government Securities, Inc.,
dated 6/30/95, due 07/03/95 at
6.210% collateralized by U.S.
Treasury bills and notes with
various maturities to 1999,
market value $2,394,425
(repurchase proceeds
$2,344,213) $2,343,000 2,343,000
---------
Other Assets & Liabilities--Net--(0.6%) 85,809
---------
Net Assets--(100.0%) $12,663,975
---------
Notes to investment portfolio:
(a) Non-income producing.
(b) The cost for federal income tax purposes is identical. Gross unrealized
appreciation and depreciation at June 30, 1995 is as follows:
Gross unrealized appreciation $ 913,839
Gross unrealized depreciation (34,673)
------------
Net unrealized appreciation $ 879,166
============
Acronym Name
---------- ----------------------------
ADR American Depository Receipt
GDR Global Depository Receipt
Summary of Securities by Country
% of Total
Country Securities
Country Abbrev. Value at Value
-------------- ------ ---------- ----------
Hong Kong HK $ 5,050,425 49.3%
Singapore Si 2,589,169 25.3%
Malaysia Ma 1,822,784 17.8%
Indonesia In 516,677 5.1%
United States US 256,111 2.5%
-------- --------
$10,235,166 100.0%
======== ========
Certain securities are listed by country of underlying exposure but may trade
predominantly on other exchanges.
See Notes to Financial Statements.
41
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
Keyport Variable Investment Trust Newport-Keyport Tiger Fund / June 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Assets:
Investments, at market value (Identified cost $9,356,000) $10,235,166
Short-term obligations 2,343,000
Cash (including foreign currencies) 46,815
Receivable for fund shares sold 24,744
Dividends and interest receivable 16,032
Other assets 24,460
----------
Total assets 12,690,217
----------
Liabilities:
Payable for fund shares repurchased 1,132
Management fee payable 17,096
Accrued expenses payable 8,014
----------
Total liabilities 26,242
----------
Net assets $12,663,975
==========
Net assets represented by:
Paid-in capital $11,728,370
Accumulated undistributed net investment income 65,193
Accumulated net realized losses on investments and foreign currency
transactions (8,754)
Net unrealized appreciation on investments and foreign currency transactions 879,166
----------
Total net assets applicable to shares of beneficial interest outstanding $12,663,975
==========
Shares of beneficial interest outstanding 5,798,392
==========
Net asset value per share $2.18
==========
</TABLE>
STATEMENT OF OPERATIONS (Unaudited)
For the period from the commencement of operations May 1, 1995 to June 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Investment income:
Dividends (net of foreign taxes withheld) $ 63,130
Interest income 27,237
------
Total investment income 90,367
------
Expenses:
Management fee 17,096
Bookkeeping fee 4,500
Transfer agent fee 1,250
Printing expense 32
Trustees' expense 80
Custodian fee 1,210
Registration expense 484
Miscellaneous expense 522
------
Total expenses 25,174
------
Net investment income 65,193
Realized and unrealized gains (losses) on
investments and foreign currency transactions:
Net realized gains on investments 978
Net realized losses on foreign currency transactions (9,732)
Change in unrealized appreciation on investments and foreign currency
transactions 879,166
------
Net increase in net assets resulting from operations $935,605
======
</TABLE>
See Notes to Financial Statements.
42
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Keyport Variable Investment Trust Newport-Keyport Tiger Fund
<TABLE>
<CAPTION>
(Unaudited)
Period Ended
June 30,
------------
1995*
------------
<S> <C>
Operations:
Net investment income $ 65,193
Net realized gains on investments 978
Net realized losses on foreign currency transactions (9,732)
Unrealized appreciation on investments and foreign currency transactions 879,166
----------
Net increase in net assets resulting from operations 935,605
----------
Fund share transactions:
Proceeds from fund shares sold 11,782,946
Cost of fund shares repurchased (54,576)
----------
Net increase in net assets resulting from fund share transactions 11,728,370
----------
Total increase in net assets 12,663,975
Net assets:
Beginning of period 0
----------
End of period $12,663,975
==========
Accumulated undistributed net investment income included in ending net assets $ 65,193
==========
Analysis of changes in shares of beneficial interest:
Shares sold 5,823,611
Shares redeemed (25,219)
----------
Net increase 5,798,392
==========
</TABLE>
* For the period from the commencement of operations May 1, 1995 to June 30,
1995.
FINANCIAL HIGHLIGHTS
Keyport Variable Investment Trust Newport-Keyport Tiger Fund
<TABLE>
<CAPTION>
(Unaudited)
Period Ended
June 30,
1995***
------------
<S> <C>
Per share operating performance:
Net asset value, beginning of period $2.00
----------
Net investment income 0.01
Net realized and unrealized gains on investments and foreign currency
transactions 0.17
----------
Total from investment operations 0.18
----------
Net asset value, end of period $2.18
==========
Total return:
Total investment return 9.00%**
Ratios/supplemental data:
Net assets, end of period (000) $12,664
Ratio of net expenses to average net assets 1.30%*
Ratio of net investment income to average net assets 3.37%*
Portfolio turnover ratio 0%*
</TABLE>
* Annualized
** Not Annualized
*** For the period from the commencement of operations May 1, 1995 to June 30,
1995.
See Notes to Financial Statements.
43
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Note 1. Organization and Accounting Policies
Keyport Variable Investment Trust (the "Trust") an open-end, diversified
management investment company, was organized as a Massachusetts business trust
on March 4, 1993. At June 30, 1995 the Trust consisted of seven Funds with
different investment objectives, policies, and restrictions: Colonial-Keyport
Growth and Income Fund ("Growth and Income Fund"), Colonial-Keyport Utilities
Fund ("Utilities Fund"), Colonial-Keyport U.S. Government Fund ("U.S. Government
Fund"), Colonial-Keyport International Fund for Growth ("International Fund for
Growth"), Colonial-Keyport Strategic Income Fund ("Strategic Income Fund"),
Colonial-Keyport U.S. Fund for Growth ("U.S. Fund for Growth"), and
Newport-Keyport Tiger Fund ("Tiger Fund") (individually referred to as a "Fund",
or collectively referred to as the "Funds").
Shares of the Trust are available and are being marketed exclusively as a pooled
funding vehicle for variable annuity contracts ("VA contracts") and Variable
Life Insurance Policies ("VLI Policies") of Keyport Life Insurance Company
("Keyport"), Keyport America Life Insurance Company (formerly Crown America Life
Insurance Company) (a wholly owned subsidiary of Keyport), and the VA contracts
of Liberty Life Assurance Company of Boston. The insurance companies and their
separate accounts own all the shares of the Funds. Keyport Advisory Services
Corp. (the "Manager"), a wholly-owned subsidiary of Keyport, provides investment
management, advisory, and administrative services to the Trust. Colonial
Management Associates, Inc. ("Colonial") provides sub-advisory services to each
Fund of the Trust, other than the Tiger Fund. Newport Fund Management, Inc.
("Newport") provides sub-advisory services to the Tiger Fund. Colonial also
provides pricing and recordkeeping services to the Trust. Keyport Financial
Services, Corp., a wholly-owned subsidiary of Keyport, serves as the underwriter
of the Trust. The Manager, Keyport, Colonial and Newport are indirect
wholly-owned subsidiaries of Liberty Financial Companies, Inc. ("Liberty
Financial"). Liberty Mutual Insurance Company ("Liberty Mutual") owns
approximately 82% of the outstanding voting shares of Liberty Financial. Liberty
Life is a wholly-owned subsidiary of Liberty Mutual and Liberty Mutual Fire
Insurance Company.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements. The policies are in
conformity with generally accepted accounting principles.
Valuation of Investments--Portfolio securities listed on an exchange and
over-the-counter securities quoted on the NASDAQ system are valued on the basis
of the last sale on the date as of which the valuation is made, or, lacking any
sales, at the current bid prices. Over-the-counter securities not quoted on the
NASDAQ system are valued at the latest bid quotation. Long-term debt securities
are valued on the basis of dealer-supplied quotations or valuations furnished by
a pricing service which may employ electronic data processing techniques,
including a "matrix" system to determine the valuations. Foreign debt securities
are valued at the current bid price furnished by market makers. Foreign equity
securities listed on an exchange are valued on the basis of last sale on the
date as of which the valuation is made, or lacking any sales, at the current bid
prices. Forward currency contracts are valued based on the weighted value of the
exchange traded contracts with similar durations. Securities for which reliable
quotations are not readily available are valued at fair value, as determined in
good faith and pursuant to procedures established by the Trustees. Short-term
instruments with remaining maturities of 60 days or less are valued at amortized
cost unless the Trustees determine this does not represent fair value. The U.S.
Government Fund may enter into dollar roll transactions. A dollar roll
transaction involves a sale by the Fund of securities that it holds with an
agreement by the Fund to repurchase substantially similar securities at an
agreed upon price and date.
Federal Income Taxes--The Funds intend to qualify as "regulated investment
companies" and as such (and by complying with the applicable provisions of the
Internal Revenue Code) will not be subject to Federal income tax on taxable
income (including realized capital gains) distributed to shareholders. By making
the distributions required under the Internal Revenue Code, the Funds intend to
avoid excise tax liability.
Organization Expenses--Costs incurred in connection with the organization and
offering of the Funds are being deferred and amortized over 60 months from the
date those Funds commenced business.
Delayed Delivery Transactions--The Growth and Income, U.S. Government and
Strategic Income Funds may purchase or sell securities on a when-issued or
forward commitment basis. Payment and delivery may take place a month or more
after the date of the transaction. The price of the underlying securities and
the date when the securities will be delivered and paid for are fixed at the
time the transaction is negotiated. This may increase the risk if the other
party involved in the transaction fails to deliver and causes the Funds to
subsequently invest at less advantageous prices. The Funds identify securities
as segregated in their custodial records with a value at least equal to the
amount of the purchase commitment.
Dollar Roll Transactions--During the period between the sale and repurchase of
dollar roll transactions, the Fund will not be entitled to accrue interest
and receive principal payments on the securities sold. Dollar roll transactions
involve the risk that the market value of the securities sold by the Fund may
decline below the repurchase price of those securities. The Fund maintains a
segregated account with its custodian bank in which it will maintain cash, U.S.
government securities or other liquid high grade debt obligations equal in value
to its obligations with respect to dollar rolls. In the event the buyer of
securities under a dollar roll transaction files for bankruptcy or becomes
insolvent, the Fund's use of proceeds of the transaction may be restricted
pending a determination by the other party.
44
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Expenses--Most expenses of the Trust can be attributed to a Fund. Expenses which
cannot be directly attributed are apportioned among the Funds in the Trust.
Other--Security transactions are accounted for on trade date. Interest
income is recorded on the accrual basis. Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Net realized and unrealized
gains (losses) on foreign currency transactions include the fluctuation in
exchange rates on gains and losses between trade and settlement dates on
security transactions, gains and losses arising from the disposition of foreign
currency, and currency gains and losses between the accrual and payment dates on
dividend and interest income and foreign withholding taxes. The Funds do not
isolate that portion of the results of operations resulting from changes in
foreign exchange rates on investments from the fluctuations arising from changes
in market prices of securities held. Such fluctuations are included with the net
realized and unrealized gain or loss from investments. The Funds may enter into
forward currency contracts to purchase or sell foreign currencies at
predetermined exchange rates in connection with the settlement of purchases and
sales of securities. The Funds may also enter into forward currency contracts to
hedge certain other foreign currency denominated assets. The contracts are used
to minimize the exposure to foreign exchange rate fluctuations during the period
between trade and settlement date of the contracts. All contracts are
marked-to-market daily, resulting in unrealized gains or losses which become
realized at the time the forward currency contracts are closed or mature.
Realized and unrealized gains (losses) arising from such transactions are
included in net realized and unrealized gains (losses) on foreign currency
transactions. Forward currency contracts do not eliminate fluctuations in the
prices of the Fund's portfolio securities. While the maximum potential loss from
such contracts is the aggregate face value in U.S. dollars at the time the
contract was opened, the actual exposure is typically limited to the change in
value of the contract (in U.S. dollars) over the period it remains open. Risks
may also arise if counterparties fail to perform their obligations under the
contracts.
Note 2. Fund Share Transactions
Each Fund's capitalization consists of an unlimited number of shares of
beneficial interest without par value that represent a separate series of the
Trust. Each share of a Fund represents an equal proportionate beneficial
interest in that Fund and, when issued and outstanding, is fully paid and non-
assessable. Shareholders would be entitled to share proportionally in the net
assets of a Fund available for distribution to shareholders upon liquidation of
a Fund.
Note 3. Security Transactions
Realized gains and losses are computed on the identified cost basis for both
financial reporting and Federal income tax purposes. At December 31, 1994, the
Growth and Income Fund, Utilities Fund, U.S. Government Fund, and the
International Fund for Growth had capital loss carryovers of $754,296,
$3,003,202, $978,947, and $4,211, respectively, which will expire in or before
2002, if not utilized. The cost of investments purchased and proceeds from
investments sold excluding short-term investments for the six months or period
ended June 30, 1995, for the Funds were are follows:
Growth U.S.
and Income Utilities Government
Fund Fund Fund
---------- --------- ------------
Cost of investments
purchased $25,342,493 $5,837,272 $28,968,708
Proceeds from
investments sold 23,371,950 3,077,485 23,223,319
International Strategic
Fund for Income U.S. Fund
Growth Fund for Growth
----------- --------- ------------
Cost of investments
purchased $5,277,323 $7,819,811 $21,066,191
Proceeds from
investments sold 3,873,303 2,960,577 9,210,180
Newport-
Tiger Fund
----------
Cost of investments purchased $10,863,264
Proceeds from investments sold --
Note 4. Distributions to Shareholders
The Funds intend to distribute as dividends or capital gain distributions, at
least annually, substantially all of their net investment income and net profits
realized from the sale of investments. All dividends and distributions are
reinvested in additional shares of the Funds at net asset value as of the record
date of the distribution. Income and capital gain distributions are determined
in accordance with Federal tax regulations, which may differ from generally
accepted accounting principles. Certain of the Funds changed the classification
of distributions to shareholders to better disclose the differences between
financial statement amounts and distributions to shareholders in accordance with
Federal income tax regulations. Accordingly, amounts as of December 31, 1994
have been reclassified as follows:
Growth U.S. International Strategic
and Income Government Fund for Income
Fund Fund Growth Fund
-------- --------- -------- ----------
Accumulated net
investment income $(5,822) $(360,479) $ (16) $(11,242)
Accumulated net
realized gain
(losses) on
investments 5,822 360,479 164,488 11,242
Paid in capital -- -- (164,472) --
In all cases, net investment income, net realized gains (losses) and net assets
were not affected by these changes.
Note 5. Fees and Compensation Paid to Affiliates
Management and Sub-Advisory Fees--The Funds have management and sub-advisory
agreements with the Manager, Colonial and Newport, respectively. For all the
Funds, the management fee to be paid to the Manager is computed daily
45
<PAGE>
and paid monthly based upon the average daily net assets of the Funds at
annual rates as follows:
Annual Rate
as a Percent
of Average
Daily
Funds Net Assets
-------------------------------- --------------
Growth and Income Fund .65 of 1%
Utilities Fund .65 of 1%
U.S. Government Fund .60 of 1%
International Fund for Growth .90 of 1%
Strategic Income Fund .65 of 1%
U.S. Fund for Growth .80 of 1%
Tiger Fund .90 of 1%
The Manager, out of the management fee it receives from the Funds, pays Colonial
and Newport a sub-advisory fee based upon the average daily net assets of the
Funds at annual rates as follows:
Annual Rate
as a Percent
of Average
Daily
Funds Net Assets
-------------------------------- --------------
Growth and Income Fund .45 of 1%
Utilities Fund .45 of 1%
U.S. Government Fund .40 of 1%
International Fund for Growth .70 of 1%
Strategic Income Fund .45 of 1%
U.S. Fund for Growth .60 of 1%
Tiger Fund .70 of 1%
Bookkeeping Fee--Colonial provides bookkeeping and pricing services to each
Fund for $27,000 per year plus rates ranging from 0.035% to 0.025% of the Fund's
average daily net assets over $50 million.
Transfer Agent Fee--Each of the Funds paid Colonial Investment Services, Inc.,
an affiliate of the sub-advisor, for transfer agent services rendered at an
annual rate of $7,500 computed on the basis of $625 per month.
Expense Reimbursement--For the period beginning with commencement of operations
through April 30, 1996, the Manager agreed to reimburse all expenses, including
management fees in excess of 1.00% of average daily net assets per annum for all
Funds other than International Fund for Growth and Tiger Fund which will be
reimbursed for all expenses exceeding 1.75% of average daily net assets.
Effective May 1, 1995, the expense limit on Strategic Income Fund was changed to
0.80% of average daily net assets until April 30, 1996.
Note 6. Investment in Repurchases Agreements
Each Fund may enter into repurchase agreements with banks, broker-dealer firms
and other recognized financial institutions whereby such institutions sell an
instrument in which a Fund may invest to that Fund, and the seller agrees, at
the time of the sale, to repurchase that instrument at a specified time and
price. The Funds require the seller of the instrument to maintain on deposit
with the Funds' custodian bank or in the Federal Reserve Book-Entry System
securities in an amount at all times equal to or in excess of the value of the
repurchase agreement plus accrued interest. In the event that the seller of the
instrument defaults on the repurchase obligation, a Fund could receive less than
the repurchase price on the sale of the securities to another party or could be
subject to delays in selling the securities.
Note 7. Proposed Fund Substitutions
The Trustees have approved the substitution of shares of the Mortgage Securities
Income Fund ("MSIF") for the shares of Colonial-Keyport U.S. Government Fund.
The Trustees also approved the substitution of shares of Colonial-Keyport
Strategic Income Fund for the shares of Managed Income Fund ("MIF"). MSIF and
MIF are series funds of the SteinRoe Variable Investment Trust. These proposed
substitutions are to take place prior to year end 1995.
46
<PAGE>
Adviser
Keyport Advisory Services Corp.
125 High Street
Boston, Massachusetts 02110
Sub-Investment Adviser and
Transfer and Dividend Disbursing Agent
Colonial Management Associates, Inc.
One Financial Center
Boston, Massachusetts 02111-2365
Sub-Investment Adviser
Newport Fund Management
580 California Street
Suite 1960
San Francisco, California 94104
Distributor
Keyport Financial Services Corp.
125 High Street
Boston, Massachusetts 02110
Client Services
Keyport Life Insurance Company
125 High Street
Boston, Massachusetts 02110
800-367-3653 (Press 3)
Custodian
Boston Safe Deposit and Trust Company
One Boston Place
Boston, Massachusetts 02108
Independent Accountants
Price Waterhouse LLP
160 Federal Street
Boston, Massachusetts 02110
Legal Counsel
Bingham, Dana & Gould
150 Federal Street
Boston, Massachusetts 02110
The Trustees
John A. Bacon Jr.
Richard R. Christensen
Salvatore Macera
Dr. Thomas E. Stitzel
This report is authorized for use as sales literature only when accompanied by a
current prospectus of the Trust and a current prospectus for a variable
insurance product offered by Keyport Life Insurance Company, Keyport America
Life Insurance Company, or Liberty Life Assurance Company of Boston.
8/95 NIM 9.5m
