<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND TWO WORLD TRADE CENTER, NEW YORK, NEW YORK
10048
LETTER TO THE SHAREHOLDERS
DEAR SHAREHOLDER:
We are pleased to present the first annual report to shareholders for Dean
Witter Global Utilities Fund. The Fund, which commenced operations on May 31,
1994, completed its first fiscal year on February 28, 1995.
The period since the Fund's inception was one of rapidly rising interest rates
both in the United States and overseas. An overheating economy and the threat of
inflation prompted the U.S. Federal Reserve Board to continue its policy of
raising short-term interest rates which was begun in early February 1994. The
sharp rise in interest rates had a negative impact on most of the U.S. financial
markets, including the utilities sector. However, as the economy began to show
signs of slowing down early in 1995, the equity market rebounded, reaching new
highs as the fiscal year came to a close. U.S. electric utilities showed a
mildly positive performance during the Fund's fiscal year, following their
previous decline, while U.S. telecommunications stocks moved positively during
the first two months of 1995, in line with the U.S. stock market as a whole.
Overseas markets, which had an unusually strong year in 1993, were weak
throughout 1994 due primarily to higher interest rates. Emerging markets had
special difficulties during the past twelve months because of Mexico's financial
problems and the overheating of the Chinese economy. Looking forward, we believe
most regions of the world are entering a period of coordinated growth, which may
be positive for utilities.
PERFORMANCE AND PORTFOLIO COMPOSITION
Against this backdrop, Dean Witter Global Utilities Fund provided a total return
of -0.87 percent since inception through February 28, 1995. While the Fund's
domestic holdings provided a positive return during the reporting period, this
was offset by a negative return for the Fund's foreign holdings. As of February
28, 1995, the Fund's net assets totaled $338 million. The Fund distributed
dividends totalling $.115 per share during the reporting period. The
accompanying chart illustrates the growth of a $10,000 investment in the Fund
from inception through February 28, 1995, compared to a hypothetical investment
in the securities that comprise the broad-based MSCI World Index. The MSCI World
Index incorporates stocks of all industries including the utilities industry in
which the Fund invests.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
LETTER TO THE SHAREHOLDERS, CONTINUED
As a result of the challenging investment climate, the Fund's assets were
invested cautiously. As of the end of the fiscal year, 60 percent of the Fund's
assets were invested in equities, with the remaining 40 percent invested in cash
equivalents. The Fund's equity holdings were allocated among telecommunications
(53 percent), electric utilities (27 percent), and natural gas and other
utility-related stocks (20 percent). The Fund intends to capitalize on the
revolution taking place worldwide in the telecommunications sector by purchasing
stocks of telephone operating, cellular, equipment, and cable TV companies. In
addition to providing attractive long-term growth opportunities, these stocks
also provide a degree of stability because they are somewhat less interest rate
sensitive than electric utilities.
[GRAPHIC]
At the end of the reporting period, the Fund's portfolio was geographically
diversified among 24 countries, with 46 percent of equities in Europe, 29
percent in the United States, 17 percent among the nations that comprise the
Pacific Rim and 8 percent in Latin America. As of February 28, 1995,
approximately 85 percent of the Fund's assets were invested in developed markets
such as the United States, United
Kingdom, Germany and Japan, with the
remaining 15 percent allocated to
emerging markets, which have the
world's fastest growing utility
companies.
LOOKING AHEAD
[GRAPHIC]
Global interest rates made 1994 an
unusually challenging year, and we
believe that 1995 will be a better year
for global utility investing. Utilities
are essential services worldwide, and
many foreign utilities companies enjoy
superior growth opportunities compared
to their domestic counterparts.
However, we believe the United States
will continue to provide a higher-
yielding core for the portfolio. The
Fund will also continue to invest in
privatizations worldwide, such as those
of the U.K. cable TV companies which
are currently taking place.
[GRAPHIC]
We appreciate your support of Dean
Witter Global Utilities Fund and look
forward to continuing to serve your
investment objectives in the future.
Very truly yours,
[SIG]
CHARLES A. FIUMEFREDDO
CHAIRMAN OF THE BOARD
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1995
<TABLE>
<CAPTION>
SHARES VALUE
- ------------------------------------------------------------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS (60.2%)
ARGENTINA (1.2%)
NATURAL GAS - DISTRIBUTION
105,000 Metrogas, S.A. (ADR)*............. $ 971,250
---------------
TELECOMMUNICATIONS
497,000 Telecom Argentina, S.A............ 1,714,650
---------------
UTILITIES - ELECTRIC
499,000 Central Puerto, S.A. (Class B).... 1,372,250
---------------
TOTAL ARGENTINA................... 4,058,150
---------------
AUSTRALIA (1.9%)
UTILITIES - ELECTRIC
2,058,592 Australian Gas Light Co........... 6,481,613
---------------
AUSTRIA (0.9%)
AIRPORT MANAGEMENT
71,000 Flughafen Wien AG................. 3,089,355
---------------
BRAZIL (0.4%)
UTILITIES - ELECTRIC
16,900,000 Companhia Energetica de Minas
Gerais (Pref.)*................... 1,363,545
---------------
CHILE (2.2%)
TELECOMMUNICATIONS
20,500 Compania de Telefonos de Chile
(ADR)............................. 1,250,500
110,000 Empresas Telex-Chile, S.A.
(ADR)............................. 838,750
---------------
2,089,250
---------------
UTILITIES - ELECTRIC
114,000 Empresa Nacional de Electridad,
S.A. (ADR)........................ 2,593,500
121,000 Enersis, S.A. (ADR)............... 2,813,250
---------------
5,406,750
---------------
TOTAL CHILE....................... 7,496,000
---------------
CHINA (0.4%)
UTILITIES - ELECTRIC
132,000 Shandong Huaneng Power Co., Ltd.
(ADR)*............................ 1,204,500
---------------
DENMARK (1.9%)
TELECOMMUNICATIONS
126,000 Tele Danmark (B Shares)........... 6,422,815
---------------
<CAPTION>
SHARES VALUE
- ------------------------------------------------------------------
<C> <S> <C>
FINLAND (2.2%)
TELECOMMUNICATIONS
53,100 Nokia AB.......................... $ 7,316,325
---------------
FRANCE (1.4%)
WATER
50,000 Cie Generale Des Eaux............. 4,629,178
---------------
GERMANY (4.7%)
ELECTRIC EQUIPMENT
3,700 Siemens AG........................ 1,717,396
---------------
MACHINERY - DIVERSIFIED
25,700 Mannesmann AG..................... 7,459,985
---------------
UTILITIES - ELECTRIC
18,600 Veba AG........................... 6,672,417
---------------
TOTAL GERMANY..................... 15,849,798
---------------
HONG KONG (0.8%)
UTILITIES - ELECTRIC
1,240,000 Consolidated Electric Power....... 2,582,331
---------------
INDONESIA (0.5%)
TELECOMMUNICATIONS
50,000 PT Indonesia Satellite Corp.
(ADR)*............................ 1,781,250
---------------
ITALY (1.0%)
TELECOMMUNICATIONS
1,466,000 Telecom Italia.................... 3,552,282
---------------
JAPAN (3.0%)
TELECOMMUNICATIONS
585 Nippon Telegraph & Telephone
Corp.............................. 4,174,250
---------------
TELECOMMUNICATIONS EQUIPMENT
70,000 Kyocera Corp...................... 4,509,824
132,000 Sumitomo Electric................. 1,501,552
---------------
6,011,376
---------------
TOTAL JAPAN....................... 10,185,626
---------------
MALAYSIA (0.9%)
TELECOMMUNICATIONS
555,000 Technology Resource Industries
Berhad*........................... 1,891,527
162,000 Telekom Malaysia Berhad........... 1,135,974
---------------
TOTAL MALAYSIA.................... 3,027,501
---------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1995, CONTINUED
<TABLE>
<CAPTION>
SHARES VALUE
- ------------------------------------------------------------------
<C> <S> <C>
MEXICO (1.2%)
TELECOMMUNICATIONS
124,000 Grupo Iusacell, S.A. (Series L)
(ADR)............................. $ 1,317,500
102,000 Telefonos de Mexico, S.A. de C.V.
(Series L) (ADR).................. 2,817,750
---------------
TOTAL MEXICO...................... 4,135,250
---------------
NETHERLANDS (2.1%)
TELECOMMUNICATIONS
199,000 Koninklijke PTT Nederlanden....... 7,025,531
---------------
NEW ZEALAND (1.9%)
TELECOMMUNICATIONS
1,880,000 Telecommunications Corp. of New
Zealand, Ltd...................... 6,517,746
---------------
SOUTH KOREA (0.7%)
UTILITIES - ELECTRIC
135,000 Korea Electric Power Corp.
(ADR)............................. 2,531,250
---------------
SPAIN (3.7%)
TELECOMMUNICATIONS
485,000 Telefonica de Espana.............. 6,045,916
---------------
UTILITIES - ELECTRIC
144,600 ENDESA............................ 6,294,819
---------------
TOTAL SPAIN....................... 12,340,735
---------------
SWEDEN (0.5%)
ELECTRIC EQUIPMENT
29,000 Ericsson AB (Series "B" Free)..... 1,605,224
---------------
SWITZERLAND (2.1%)
MULTI - INDUSTRY
8,035 BBC Brown Boveri AG............... 7,001,371
---------------
UNITED KINGDOM (7.0%)
NATURAL GAS
1,052,000 British Gas PLC................... 4,829,416
---------------
TELECOMMUNICATIONS
564,000 Cable & Wireless.................. 3,330,189
1,270,000 Telewest Communications*.......... 3,719,259
<CAPTION>
SHARES VALUE
- ------------------------------------------------------------------
<C> <S> <C>
1,977,073 Vodafone Group PLC................ $ 5,915,145
---------------
12,964,593
---------------
UTILITIES - ELECTRIC
315,000 Powergen PLC...................... 2,478,266
240,240 Yorkshire Electricity............. 3,217,337
---------------
5,695,603
---------------
TOTAL UNITED KINGDOM.............. 23,489,612
---------------
UNITED STATES (17.6%)
ELECTRONICS - SEMICONDUCTORS/COMPONENTS
60,000 Motorola, Inc..................... 3,450,000
---------------
NATURAL GAS
130,000 Enron Corp........................ 4,290,000
50,000 Tenneco Inc....................... 2,275,000
---------------
6,565,000
---------------
TELECOMMUNICATIONS
70,000 Bell Atlantic Corp................ 3,753,750
65,000 BellSouth Corp.................... 3,835,000
130,000 GTE Corp.......................... 4,338,750
65,000 NYNEX Corp........................ 2,551,250
105,000 SBC Communications, Inc........... 4,370,625
105,000 U.S. West, Inc.................... 4,068,750
---------------
22,918,125
---------------
TELECOMMUNICATIONS - LONG DISTANCE
85,000 AT&T Corp......................... 4,398,750
180,000 MCI Communications Corp........... 3,600,000
125,000 Sprint Corp....................... 3,656,250
---------------
11,655,000
---------------
UTILITIES - ELECTRIC
175,000 CMS Energy Corp................... 4,200,000
105,000 Duke Power Co..................... 4,121,250
110,000 Pacific Gas & Electric Co......... 2,818,750
185,000 Southern Co....................... 3,815,625
---------------
14,955,625
---------------
TOTAL UNITED STATES............... 59,543,750
---------------
TOTAL COMMON AND PREFERRED STOCKS
(IDENTIFIED COST $212,172,434).... $ 203,230,738
---------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1995, CONTINUED
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ------------------------------------------------------------------
<C> <S> <C>
SHORT-TERM INVESTMENTS (40.5%)
U.S. GOVERNMENT AGENCIES (a) (38.7%)
$ 35,000 Federal Home Loan Banks 5.86% due
3/15/95........................... $ 34,920,511
16,000 Federal Home Loan Banks 5.86% due
3/13/95........................... 15,968,800
26,000 Federal Home Loan Mortgage Corp.
5.87% due 3/07/95................. 25,974,650
20,000 Federal Home Loan Mortgage Corp.
5.91% due 3/22/95................. 19,931,283
34,000 Federal National Mortgage
Association 5.89% due 3/06/95..... 33,972,281
---------------
TOTAL U.S. GOVERNMENT AGENCIES
(AMORTIZED COST $130,767,525)..... 130,767,525
---------------
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ------------------------------------------------------------------
<C> <S> <C>
REPURCHASE AGREEMENT (1.8%)
$ 5,850 The Bank of New York 6.00% due
3/1/95 (dated 2/28/95; proceeds
$5,850,748; collateralized by
$6,635,039 Federal National
Mortgage Association 7.00% due
10/01/24 valued at $6,212,459)
(Identified Cost $5,849,773)...... $ 5,849,773
---------------
TOTAL SHORT-TERM INVESTMENTS
(IDENTIFIED COST $136,617,298).... 136,617,298
---------------
TOTAL INVESTMENTS
(IDENTIFIED COST
$348,789,732) (B)........... 100.7% 339,848,036
LIABILITIES IN EXCESS OF
OTHER ASSETS................ (0.7) (2,248,292)
----- ------------
NET ASSETS.................. 100.0% $337,599,744
----- ------------
----- ------------
<FN>
- ---------------------
ADR American Depository Receipt.
* Non-income producing security.
(a) Securities were purchased on a discount basis. The interest rate shown has
been adjusted to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes is $348,789,732; the
aggregate gross unrealized appreciation is $8,546,551 and the aggregate
gross unrealized depreciation is $17,488,247, resulting in net unrealized
depreciation of $8,941,696.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
SUMMARY OF INVESTMENTS FEBRUARY 28, 1995
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------
Airport Management...................... $ 3,089,355 0.9%
Electric Equipment...................... 3,322,620 1.0
Electronics -
Semiconductors/Components............. 3,450,000 1.0
Machinery - Diversified................. 7,459,985 2.2
Multi - Industry........................ 7,001,371 2.1
Natural Gas............................. 11,394,416 3.3
Natural Gas - Distribution.............. 971,250 0.3
Repurchase Agreement.................... 5,849,773 1.8
Telecommunications...................... 89,685,484 26.5
Telecommunications Equipment............ 6,011,376 1.8
Telecommunications - Long Distance...... 11,655,000 3.5
Utilities - Electric.................... 54,560,703 16.2
U.S. Government Agencies................ 130,767,525 38.7
Water................................... 4,629,178 1.4
------------ -----
$339,848,036 100.7%
------------ -----
------------ -----
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
- ------------------------------------------------------------------
<S> <C> <C>
Common Stocks........................... $201,867,193 59.8%
Preferred Stocks........................ 1,363,545 0.4
Short-Term Investments.................. 136,617,298 40.5
------------ -----
$339,848,036 100.7%
------------ -----
------------ -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 28, 1995
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $348,789,732)............................. $339,848,036
Receivable for:
Shares of beneficial interest sold...................... 830,273
Dividends............................................... 245,026
Foreign withholding taxes reclaimed..................... 42,455
Deferred organizational expenses............................ 148,184
Prepaid expenses and other assets........................... 58,343
------------
TOTAL ASSETS........................................... 341,172,317
------------
LIABILITIES:
Payable for:
Investments purchased................................... 2,450,250
Shares of beneficial interest repurchased............... 416,900
Plan of distribution fee................................ 261,327
Investment management fee............................... 169,868
Accrued expenses and other payables......................... 274,228
------------
TOTAL LIABILITIES...................................... 3,572,573
------------
NET ASSETS:
Paid-in-capital............................................. 346,237,791
Net unrealized depreciation................................. (8,939,407)
Undistributed net investment income......................... 333,688
Net realized loss........................................... (32,328)
------------
NET ASSETS............................................. $337,599,744
------------
------------
NET ASSET VALUE PER SHARE,
34,448,334 SHARES OUTSTANDING (UNLIMITED SHARES AUTHORIZED
OF $.01 PAR VALUE)........................................
$9.80
------------
------------
</TABLE>
STATEMENT OF OPERATIONS
FOR THE PERIOD MAY 31, 1994*
THROUGH FEBRUARY 28, 1995
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Interest.................................................... $ 6,229,452
Dividends (net of $170,681 foreign withholding tax)......... 2,258,950
-----------
TOTAL INCOME........................................... 8,488,402
-----------
EXPENSES
Plan of distribution fee.................................... 2,230,263
Investment management fee................................... 1,449,676
Transfer agent fees and expenses............................ 376,311
Registration fees........................................... 126,730
Professional fees........................................... 76,408
Custodian fees.............................................. 75,662
Organizational expenses..................................... 26,258
Shareholder reports and notices............................. 17,050
Trustees' fees and expenses................................. 14,610
Other....................................................... 4,227
-----------
TOTAL EXPENSES......................................... 4,397,195
-----------
NET INVESTMENT INCOME.................................. 4,091,207
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments............................................. (28,076)
Foreign exchange transactions........................... 12,700
-----------
NET LOSS............................................... (15,376)
-----------
Net unrealized appreciation
(depreciation) on:
Investments............................................. (8,941,696)
Translation of other assets and liabilities denominated
in foreign currencies................................. 2,289
-----------
NET DEPRECIATION....................................... (8,939,407)
-----------
NET LOSS............................................... (8,954,783)
-----------
NET DECREASE................................................ $(4,863,576)
-----------
-----------
<FN>
- ---------------------
* Commencement of operations.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE PERIOD
MAY 31, 1994*
THROUGH
FEBRUARY 28, 1995
- -------------------------------------------------------------------------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income....................................... $ 4,091,207
Net realized loss........................................... (15,376)
Net unrealized depreciation................................. (8,939,407)
-----------------
NET DECREASE........................................... (4,863,576)
-----------------
Dividends to shareholders from net investment income........ (3,774,471)
Net increase from transactions in shares of beneficial
interest.................................................. 346,137,791
-----------------
NET INCREASE........................................... 337,499,744
-----------------
NET ASSETS:
Beginning of period......................................... 100,000
-----------------
END OF PERIOD
(INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF
$333,688)................................................ $ 337,599,744
-----------------
-----------------
<FN>
- ---------------------
* Commencement of operations.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1995
1. ORGANIZATION AND ACCOUNTING POLICIES
Dean Witter Global Utilities Fund (the "Fund") is registered under the
Investment Company Act of 1940, as amended (the "Act"), as a diversified,
open-end management investment company. The Fund was organized as a
Massachusetts business trust on October 22, 1993 and commenced operations on May
31, 1994. On February 24, 1994, the Fund issued 10,000 shares of beneficial
interest to Dean Witter InterCapital Inc. (the "Investment Manager") for
$100,000 to effect the Fund's initial capitalization.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York or American Stock Exchange or other domestic or foreign stock exchange
is valued at its latest sale price on that exchange prior to the time when
assets are valued; if there were no sales that day, the security is valued at
the latest bid price (in cases where securities are traded on more than one
exchange; the securities are valued on the exchange designated as the primary
market by the Trustees); (2) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (3) when market
quotations are not readily available, including circumstances under which it is
determined by the Investment Manager that sale or bid prices are not reflective
of a security's market value, portfolio securities are valued at their fair
value as determined in good faith under procedures established by and under the
general supervision of the Trustees; (4) certain of the Fund's portfolio
securities may be valued by an outside pricing service approved by the Trustees.
The pricing service utilizes a matrix system incorporating security quality,
maturity and coupon as the evaluation model parameters, and/or research and
evaluations by its staff, including review of broker-dealer market price
quotations, if available, in determining what it believes is the fair valuation
of the securities valued by such pricing service; and (5) short-term debt
securities having a maturity date of more than sixty days at time of purchase
are valued on a mark-to-market basis until sixty days prior to maturity and
thereafter at amortized cost based on their value on the 61st day. Short-term
debt securities having a maturity date of sixty days or less at the time of
purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Dividend income is recorded on the ex-dividend date except with
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1995, CONTINUED
respect to certain dividends on foreign securities which are recorded as soon as
the Fund is informed after the ex-dividend date. Interest income is accrued
daily and includes amortization of discounts on certain short-term securities.
C. FOREIGN CURRENCY TRANSLATION -- The books and records of the Fund are
maintained in U.S. dollars as follows: (1) the foreign currency market value of
investment securities, other assets and liabilities and forward contracts are
translated at the exchange rates prevailing at the end of the period; and (2)
purchases, sales, income and expenses are translated at the exchange rates
prevailing on the respective dates of such transactions. The resultant exchange
gains and losses are included in the Statement of Operations as realized and
unrealized gain/loss on foreign exchange transactions. Pursuant to U.S. Federal
income tax regulations, certain foreign exchange gains/losses included in
realized and unrealized gain/loss are included in or are a reduction of ordinary
income for federal income tax purposes. The Fund does not isolate that portion
of the results of operations arising as a result of changes in the foreign
exchange rates from the changes in the market prices of the securities.
D. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward foreign
currency contracts which are valued daily at the appropriate exchange rates. The
resultant unrealized exchange gains and losses are included in the Statement of
Operations as unrealized foreign currency gain or loss. The Fund records
realized gains or losses on delivery of the currency or at the time the forward
contract is extinguished (compensated) by entering into a closing transaction
prior to delivery.
E. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
F. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions to its shareholders on the record date. The amount of dividends
and distributions from net investment income and net realized capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. These "book/tax" differences are
either considered temporary or permanent in nature. To the extent these
differences are permanent in nature, such amounts are reclassified within the
capital accounts based on their federal tax-basis treatment; temporary
differences do not require reclassification. Dividends and distributions which
exceed net investment income and net realized capital gains for financial
reporting purposes but not for tax purposes are reported as dividends in excess
of net investment
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1995, CONTINUED
income or distributions in excess of net realized capital gains. To the extent
they exceed net investment income and net realized capital gains for tax
purposes, they are reported as distributions of paid-in-capital.
G. ORGANIZATIONAL EXPENSES -- The Fund's Investment Manager paid the
organizational expenses of the Fund in the amount of approximately $174,000
which was reimbursed for the full amount thereof. Such expenses have been
deferred and are being amortized by the Fund on the straight line method over a
period not to exceed five years from the commencement of operations.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement, the Fund pays the Investment
Manager a management fee, accrued daily and payable monthly, by applying the
annual rate of 0.65% to the net assets of the Fund determined as of the close of
each business day.
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities, equipment,
clerical, bookkeeping and certain legal services and pays the salaries of all
personnel, including officers of the Fund who are employees of the Investment
Manager. The Investment Manager also bears the cost of telephone services, heat,
light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted a
Plan of Distribution (the "Plan"), pursuant to Rule 12b-1 under the Act pursuant
to which the Fund pays the Distributor compensation accrued daily and payable
monthly at an annual rate of 1.0% of the lesser of: (a) the average daily
aggregate gross sales of the Fund's shares since the inception of the Fund (not
including reinvestment of dividend or capital gain distributions) less the
average daily aggregate net asset value of the Fund's shares redeemed since the
Fund's inception upon which a contingent deferred sales charge has been imposed
or upon which such charge has been waived; or (b) the Fund's average daily net
assets. Amounts paid under the Plan are paid to the Distributor to compensate it
for the services provided and the expenses borne by it and others in the
distribution of the Fund's shares, including the payment of commissions for
sales of the Fund's shares and incentive compensation to, and expenses of, the
account executives of Dean Witter Reynolds Inc. ("DWR"), an affiliate of the
Investment Manager and Distributor, and other employees or selected dealers who
engage in or support
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1995, CONTINUED
distribution of the Fund's shares or who service shareholder accounts, including
overhead and telephone expenses, printing and distribution of prospectuses and
reports used in connection with the offering of the Fund's shares to other than
current shareholders and preparation, printing and distribution of sales
literature and advertising materials. In addition, the Distributor may be
compensated under the Plan for its opportunity costs in advancing such amounts,
which compensation would be in the form of a carrying charge on any unreimbursed
expenses incurred by the Distributor.
Provided that the Plan continues in effect, any cumulative expenses incurred but
not yet recovered, may be recovered through future distribution fees from the
Fund and contingent deferred sales charges from the Fund's shareholders.
The Distributor has informed the Fund that for the period ended February 28,
1995, it received approximately $487,000 in contingent deferred sales charges
from certain redemptions of the Fund's shares. The Fund's shareholders pay such
charges which are not an expense of the Fund.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the period ended February 28, 1995 aggregated
$215,831,610 and $3,384,854, respectively.
For the period ended February 28, 1995, the Fund incurred brokerage commissions
of $36,000 with DWR for portfolio transactions executed on behalf of the Fund.
At February 28, 1995, the Fund's payable for investments purchased included
unsettled trades with DWR of $1,014,375.
Dean Witter Trust Company, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At February 28, 1995, the Fund had
transfer agent fees and expenses payable of approximately $47,000.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1995, CONTINUED
5. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE PERIOD MAY 31, 1994*
THROUGH FEBRUARY 28, 1995
----------------------------
SHARES AMOUNT
----------- --------------
<S> <C> <C>
Sold............................................................. 37,349,295 $ 375,264,971
Reinvestment of dividends........................................ 340,265 3,390,729
----------- --------------
37,689,560 378,655,700
Repurchased...................................................... (3,251,226) (32,517,909)
----------- --------------
Net increase..................................................... 34,438,334 $ 346,137,791
----------- --------------
----------- --------------
- ---------------------
* Commencement of operations.
</TABLE>
6. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS
The Fund may enter into forward foreign currency contracts ("forward contracts")
to facilitate settlement of foreign currency denominated portfolio transactions
or to manage foreign currency exposure associated with foreign currency
denominated securities.
Forward contracts involve elements of market and credit risk in excess of the
amounts reflected in the Statement of Assets and Liabilities. The Fund bears the
risk of an unfavorable change in the foreign exchange rates underlying the
forward contracts. Risks may also arise upon entering into these contracts from
the potential inability of the counterparties to meet the terms of their
contracts.
7. FEDERAL INCOME TAX STATUS
Capital and foreign currency losses incurred after October 31 ("post-October
losses") within the taxable year are deemed to arise on the first business day
of the Fund's next taxable year. The Fund incurred and will elect to defer net
capital and foreign currency losses of approximately $29,000 and $4,000,
respectively during fiscal 1995. As of February 28, 1995, the Fund had temporary
book/tax differences attributable to post-October losses and permanent book/tax
differences attributable to foreign currency gains.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout the period:
<TABLE>
<CAPTION>
FOR THE PERIOD
MAY 31, 1994*
THROUGH FEBRUARY
28, 1995
- -----------------------------------------------------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period............................ $ 10.00
------
Net investment income.............. 0.13
Net realized and unrealized loss... (0.21)
------
Total from investment operations... (0.08)
------
Less dividends to shareholders from
net investment income............. (0.12)
------
Net asset value, end of period..... $ 9.80
------
------
TOTAL INVESTMENT RETURN+........... (0.87)%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses........................... 1.97% (2)
Net investment income.............. 1.83% (2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands......................... $337,600
Portfolio turnover rate............ 2% (1)
<FN>
- ---------------------
* Commencement of operations.
+ Does not reflect the deduction of sales charge.
(1) Not annualized.
(2) Annualized.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND TRUSTEES
OF DEAN WITTER GLOBAL UTILITIES FUND
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Dean Witter Global Utilities Fund
(the "Fund") at February 28, 1995, and the results of its operations, the
changes in its net assets and the financial highlights for the period May 31,
1994 (commencement of operations) through February 28, 1995, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our audit
of these financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit, which included confirmation of securities at February 28, 1995 by
correspondence with the custodian and brokers, provides a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
APRIL 4, 1995
- --------------------------------------------------------------------------------
1995 FEDERAL TAX NOTICE (UNAUDITED)
During the period ended February 28, 1995, 23.51% of the ordinary
dividend qualified for the dividends received deduction available
to corporations.
<PAGE>
BOARD OF DIRECTORS
Jack F. Bennett
Michael Bozic
Charles A. Fiumefredd
Edwin J. Garn
John R. Haire
Dr. Manuel H. Johnson
Paul Kolton
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Sheldon Curtis
Vice President, Secretary and General Counsel
Edward F. Gaylor
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Dean Witter Trust Company
Harborside Financial Center -- Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and trustees,
fees, expenses and other pertinent information, please see the prospectus of the
Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
DEAN WITTER
DIVIDEND GROWTH
SECURITIES
ANNUAL REPORT
FEBRUARY 28, 1995
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
GROWTH OF $10,000
DATE TOTAL MSCI WORLD IX
May 31, 1994 $10,000 $10,000
June 30, 1994 $ 9,960 $ 9,956
July 31, 1994 $10,110 $10,129
August 31, 1994 $10,260 $10,418
September 30, 1994 $10,170 $10,128
October 31, 1994 $10,341 $10,399
November 30, 1994 $10,035 $ 9,932
December 31, 1994 $10,035 $10,011
January 31, 1995 $ 9,964 $ 9,844
February 28, 1995 $ 9,423(3) $ 9,970
AVERAGE ANNUAL TOTAL RETURNS
LIFE OF FUND
-1.16 (1)
-6.06 (2)
Fund MSCI WORLD IX (4)
------- -------
Past performance is not predictive of future returns.
- --------------------
(1) Figure shown does not reflect the deduction of any sales charges.
(2) Figure shown assumes the deduction of the maximum applicable contingent
deferred sales charge (CDSC) (Since inception 5%). See the Fund's current
prospectus for complete details on fees and sales charges.
(3) Closing value after the deduction of a 5% CDSC, assuming a complete
redemption on February 28, 1995.
(4) The Morgan Stanley Capital International World Index (MSCI) measures
performance for a diverse range of global stock markets including the U.S.,
Canada, Europe, Australia, New Zealand and the Far East. The index does
not include any expenses, fees or charges or reinvestment of dividends.
