<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND TWO WORLD TRADE CENTER, NEW YORK, NEW YORK
10048
LETTER TO THE SHAREHOLDERS FEBRUARY 28, 1998
DEAR SHAREHOLDER:
The Fund's fiscal year ended February 28, 1998, saw strong performance for
global utility stocks but was marked by heightened volatility due to the
financial crisis in Asia. Markets around the world initially reacted to the
"Asian flu" with concern regarding the health of the global economy. However,
this concern later eased and the problems in Asia were even perceived as placing
a potentially beneficial drag on the U.S. economy, which was expanding at a
rapid pace.
At the same time as global markets recovered from the events in Asia, global
telecommunications stocks, which at fiscal year-end accounted for 68 percent of
the Fund's invested assets, began advancing strongly. These stocks gained
because of mergers, acquisitions and alliances among companies and as a result
of continuing strong industry growth. For example, industry estimates are that
the number of global wireless communications subscribers increased by 49 percent
in 1997.
PERFORMANCE
For the fiscal year ended February 28, 1998, the Fund's Class B shares posted a
total return of 26.06 percent versus 26.20 percent for the Lipper Utility Funds
Index and 22.43 percent for the Morgan Stanley Capital International (MSCI)
World Index. The Fund substantially outperformed the MSCI World Index because of
the Fund's emphasis on telecommunications stocks and its low weighting in Japan.
From their inception on July 28, 1997, through February 28, 1998, the Fund's
Class A, C and D shares had total returns of 13.74 percent, 13.24 percent and
13.90 percent, respectively. Performance of the Fund's four classes varies
because of differing sales charges and expenses. The accompanying chart compares
the performance of the Fund versus the performances of the Lipper Index and the
MSCI World Index.
THE PORTFOLIO
Due to poor performance and ongoing uncertainty related to emerging market
stocks, the Fund reduced its exposure to this sector from 15 percent of invested
assets at the end of August 1997 to 4 percent at
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
LETTER TO THE SHAREHOLDERS FEBRUARY 28, 1998, CONTINUED
the end of February 1998. The Fund reinvested these proceeds in U.S. utilities,
pushing the Fund's U.S. allocation from 33 percent of invested assets to 42
percent.
New stocks added to the portfolio during the second half of the fiscal year
included Cincinnati Bell, Inc. (United States), COLT Telecom Group PLC ADR and
United Utilities PLC (United Kingdom), Copel (Series B) ADR (Brazil), France
Telecom S.A. ADR, MetroNet Communications Corp. (Class B) ADR (Canada) and
Telstra Corp. Ltd. ADR (Australia). COLT and MetroNet are examples of newer
"alternative" telecommunications companies that compete against incumbent
carriers. France Telecom, MetroNet and Telstra were purchased through initial
public offerings.
On February 28, 1998, the Fund's portfolio was diversified among the following
geographic regions: 43 percent in Europe, 42 percent in the United States, 9
percent in Canada and Latin America and 6 percent in the Pacific. At the end of
the fiscal year, the Fund's net assets totaled $397.6 million.
LOOKING AHEAD
We expect the current merger, acquisition and strategic alliance activity to
continue to be positive for telecommunications stocks. The rapid growth of the
global telecommunications industry is continuing, stimulated by new product
offerings and lower prices. The current macroeconomic environment around the
world, with its steady economic growth, should continue to enhance the market
attraction for the portfolio's electricity, natural gas and water stocks.
We appreciate your support of Dean Witter Global Utilities Fund and look forward
to continuing to serve your investment needs.
Very truly yours,
/s/ Charles A. Fiumefreddo
CHARLES A. FIUMEFREDDO
CHAIRMAN OF THE BOARD
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FUND PERFORMANCE FEBRUARY 28, 1998
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
Growth of $10,000 -- Class B
Shares
($ in Thousands)
Fund MSCI World(4) Lipper(5)
<S> <C> <C> <C>
May 31, 1994 $10,000 $10,000 $10,000
February 28,1995 $9,913 $9,970 $10,308
February 29,1996 $11,773 $12,135 $12,546
February 28,1997 $13,293 $13,553 $13,983
February 28,1998 $16,557(3) $16,593 $17,646
</TABLE>
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE RETURNS. PERFORMANCE FOR CLASS
A, CLASS C, AND CLASS D SHARES WILL VARY FROM THE PERFORMANCE OF CLASS B
SHARES SHOWN ABOVE DUE TO DIFFERENCES IN CHARGES AND EXPENSES.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS*
- ----------------------------------------------------------------------------------------------------
CLASS B SHARES** CLASS A SHARES+
- ----------------------------------------------- -----------------------------------------------
PERIOD ENDED 2/28/98 PERIOD ENDED 2/28/98
- ------------------------- -------------------------
<S> <C> <C> <C> <C> <C>
1 Year 26.06%(1) 21.06%(2) From Inception (7/28/97) 13.74%(1) 7.77%(2)
From Inception (5/31/94) 14.77(1) 14.40(2)
</TABLE>
<TABLE>
<CAPTION>
CLASS C SHARES++ CLASS D SHARES(++)
- ----------------------------------------------- -----------------------------------------------
PERIOD ENDED 2/28/98 PERIOD ENDED 2/28/98
- ------------------------- -------------------------
<S> <C> <C> <C> <C> <C>
From Inception (7/28/97) 13.24%(1) 12.24%(2) From Inception (7/28/97) 13.90%(1)
</TABLE>
- ------------------------
(1) Figure shown assumes reinvestment of all distributions and does not reflect
the deduction of any sales charges.
(2) Figure shown assumes reinvestment of all distributions and the deduction of
the maximum applicable sales charge. See the Fund's current prospectus for
complete details on fees and sales charges.
(3) Closing value assuming a complete redemption on February 28, 1998.
(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. The
Index is unmanaged and should not be considered an investment.
(5) The Lipper Utility Fund Index is an equally-weighted performance index of
the largest qualifying funds (based on net assets) in the Lipper Utility
Funds objective. The Index, which is adjusted for capital gains
distributions and income dividends, is unmanaged and should not be
considered an investment. There are currently 30 funds represented in this
Index.
* For periods of less than one year, the Fund quotes its total return on a
non-annualized basis.
** The maximum contingent deferred sales charge (CDSC) for Class B is 5.00%. The
CDSC declines to 0% after six years.
+ The maximum front-end sales charge for Class A shares is 5.25%.
++ The maximum contingent deferred sales charge for Class C shares is 1% for
shares redeemed within one year of purchase.
(++) Class D shares have no sales charge.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1998
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (95.8%)
ARGENTINA (0.5%)
UTILITIES - TELECOMMUNICATIONS
282,000 Telecom Argentina Stet - France Telecom S.A. (Class B)................................ $ 2,045,727
------------
AUSTRALIA (3.3%)
UTILITIES - NATURAL GAS
1,325,000 Australian Gas Light Company Ltd...................................................... 10,529,298
------------
UTILITIES - TELECOMMUNICATIONS
47,100 Telstra Corp. Ltd. (ADR)*............................................................. 2,561,062
------------
TOTAL AUSTRALIA....................................................................... 13,090,360
------------
AUSTRIA (0.7%)
TRANSPORTATION
71,000 Flughafen Wien AG..................................................................... 2,864,473
------------
BRAZIL (0.3%)
UTILITIES - ELECTRIC
29,000 Companhia Paranaense de Energia - Copel (Series B) (ADR).............................. 369,750
------------
UTILITIES - TELECOMMUNICATIONS
7,500 Telecomunicacoes Brasileiras S.A. (ADR)............................................... 918,281
------------
TOTAL BRAZIL.......................................................................... 1,288,031
------------
CANADA (5.3%)
TELECOMMUNICATION EQUIPMENT
160,000 Northern Telecom Ltd.................................................................. 8,518,050
------------
UTILITIES - NATURAL GAS
176,344 TransCanada Pipelines Ltd............................................................. 3,957,150
------------
UTILITIES - TELECOMMUNICATIONS
125,000 Metronet Communications Corp. (Class B) (ADR)*........................................ 2,953,125
228,000 Telus Corp............................................................................ 5,732,828
------------
8,685,953
------------
TOTAL CANADA.......................................................................... 21,161,153
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
CHILE (1.7%)
UTILITIES - ELECTRIC
115,000 Enersis S.A. (ADR).................................................................... $ 3,349,375
------------
UTILITIES - TELECOMMUNICATIONS
122,000 Compania de Telecommunicaciones de Chile S.A. (ADR)................................... 3,339,750
------------
TOTAL CHILE........................................................................... 6,689,125
------------
DENMARK (3.5%)
TRANSPORTATION
42,800 Kobenhavns Lufthavne AS............................................................... 4,544,000
------------
UTILITIES - TELECOMMUNICATIONS
143,000 Tele Danmark AS (B Shares)............................................................ 9,263,024
------------
TOTAL DENMARK......................................................................... 13,807,024
------------
FINLAND (2.0%)
TELECOMMUNICATION EQUIPMENT
77,500 Nokia AB (Series K)................................................................... 7,742,258
------------
FRANCE (2.6%)
UTILITIES - TELECOMMUNICATIONS
57,600 France Telecom S.A. (ADR)*............................................................ 2,790,000
------------
UTILITIES - WATER
48,000 Compagnie Generale des Eaux........................................................... 7,554,460
------------
TOTAL FRANCE.......................................................................... 10,344,460
------------
GERMANY (7.1%)
TELECOMMUNICATION EQUIPMENT
112,400 Siemens AG............................................................................ 6,915,065
------------
UTILITIES - ELECTRIC
175,000 VEBA AG............................................................................... 11,740,275
------------
WIRELESS COMMUNICATION
15,700 Mannesmann AG......................................................................... 9,429,689
------------
TOTAL GERMANY......................................................................... 28,085,029
------------
ITALY (3.2%)
UTILITIES - TELECOMMUNICATIONS
1,015,000 Telecom Italia SpA.................................................................... 6,912,451
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1998, CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
WIRELESS COMMUNICATION
1,220,000 Telecom Italia Mobile SpA............................................................. $ 5,587,969
------------
TOTAL ITALY........................................................................... 12,500,420
------------
JAPAN (0.6%)
TELECOMMUNICATION EQUIPMENT
12,900 Kyocera Corp.......................................................................... 695,914
------------
WIRELESS COMMUNICATION
685 DDI Corp.............................................................................. 1,787,902
------------
TOTAL JAPAN........................................................................... 2,483,816
------------
MEXICO (1.0%)
UTILITIES - TELECOMMUNICATIONS
79,000 Telefonos de Mexico S.A. de C.V. (Class L) (ADR)...................................... 4,004,312
------------
NETHERLANDS (2.9%)
UTILITIES - TELECOMMUNICATIONS
225,000 Koninklijke PTT Nederland NV.......................................................... 11,329,748
------------
NEW ZEALAND (2.0%)
UTILITIES - TELECOMMUNICATIONS
1,680,000 Telecom Corporation of New Zealand Ltd................................................ 8,052,072
------------
PORTUGAL (3.2%)
UTILITIES - TELECOMMUNICATIONS
132,000 Portugal Telecom S.A.................................................................. 6,926,803
------------
WIRELESS COMMUNICATION
44,000 Telecel-Comunicacoes Pessoais S.A.*................................................... 5,861,141
------------
TOTAL PORTUGAL........................................................................ 12,787,944
------------
SPAIN (5.6%)
UTILITIES - ELECTRIC
371,000 Empresa Nacional de Electricidad S.A.................................................. 8,205,829
428,000 Iberdrola S.A......................................................................... 6,195,030
------------
14,400,859
------------
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
UTILITIES - TELECOMMUNICATIONS
229,000 Telefonica de Espana.................................................................. $ 7,880,627
------------
TOTAL SPAIN........................................................................... 22,281,486
------------
SWEDEN (1.8%)
TELECOMMUNICATION EQUIPMENT
156,300 Ericsson (L.M.) Telephone Co. AB (Series "B" Free).................................... 7,112,984
------------
SWITZERLAND (1.9%)
ELECTRICAL EQUIPMENT
5,600 ABB AG - Bearer....................................................................... 7,652,887
------------
UNITED KINGDOM (6.4%)
CABLE & TELECOMMUNICATIONS
496,071 Cable & Wireless Communications PLC*.................................................. 2,870,703
1,058,000 Telewest PLC*......................................................................... 1,347,998
------------
4,218,701
------------
MEDIA GROUP
206,000 Carlton Communications PLC............................................................ 1,446,095
------------
UTILITIES - ELECTRIC
154,500 National Grid Group PLC............................................................... 868,675
------------
UTILITIES - TELECOMMUNICATIONS
50,000 COLT Telecom Group PLC (ADR)*......................................................... 4,175,000
------------
UTILITIES - WATER
150,000 United Utilities PLC.................................................................. 2,012,256
------------
WIRELESS COMMUNICATION
743,000 Orange PLC*........................................................................... 4,211,094
975,000 Vodafone Group PLC.................................................................... 8,655,660
------------
12,866,754
------------
TOTAL UNITED KINGDOM.................................................................. 25,587,481
------------
UNITED STATES (40.2%)
MEDIA GROUP
120,000 U.S. West Media Group*................................................................ 3,862,500
------------
TELECOMMUNICATION EQUIPMENT
70,408 Lucent Technologies, Inc.............................................................. 7,630,467
------------
UTILITIES - ELECTRIC
125,000 AES Corp.*............................................................................ 5,500,000
220,000 CMS Energy Corp....................................................................... 9,735,000
140,000 Duke Power Co......................................................................... 7,778,750
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
PORTFOLIO OF INVESTMENTS FEBRUARY 28, 1998, CONTINUED
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
210,000 Edison International.................................................................. $ 5,801,250
110,000 Houston Industries, Inc............................................................... 2,846,250
120,000 PG & E Corp........................................................................... 3,622,500
280,000 Southern Co........................................................................... 6,912,500
------------
42,196,250
------------
UTILITIES - NATURAL GAS
210,000 ENRON Corp............................................................................ 9,870,000
------------
UTILITIES - TELECOMMUNICATIONS
170,000 Ameritech Corp........................................................................ 7,086,875
100,000 AT&T Corp............................................................................. 6,087,500
114,480 Bell Atlantic Corp.................................................................... 10,274,580
190,000 BellSouth Corp........................................................................ 11,590,000
100,000 Cincinnati Bell, Inc.................................................................. 3,200,000
165,000 GTE Corp.............................................................................. 8,930,625
158,000 LCI International, Inc.*.............................................................. 5,214,000
128,000 MCI Communications Corp............................................................... 6,120,000
135,000 SBC Communications, Inc............................................................... 10,209,375
175,000 Sprint Corp........................................................................... 11,550,000
50,000 Teleport Communications Group Inc. (Class A)*......................................... 2,731,250
115,000 U.S. West Communications Group, Inc................................................... 5,987,188
150,000 WorldCom, Inc.*....................................................................... 5,728,125
------------
94,709,518
------------
WIRELESS COMMUNICATION
63,000 360 DEG. Communications Co.*.......................................................... 1,669,500
------------
TOTAL UNITED STATES................................................................... 159,938,235
------------
TOTAL COMMON STOCKS
(IDENTIFIED COST $226,808,302)........................................................ 380,849,025
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C>
SHORT-TERM INVESTMENT (a) (4.5%)
U.S. GOVERNMENT AGENCY
$ 17,900 Federal National Mortgage Assoc. 5.61% due 03/02/98
(AMORTIZED COST $17,897,211)......................................................... $ 17,897,211
------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(IDENTIFIED COST $244,705,513) (b)........................................................ 100.3 % 398,746,236
LIABILITIES IN EXCESS OF CASH AND OTHER ASSETS............................................ (0.3) (1,139,616)
------ -------------
NET ASSETS................................................................................ 100.0 % $ 397,606,620
------ -------------
------ -------------
</TABLE>
- ---------------------
ADR American Depository Receipt.
* Non-income producing security.
(a) Security was purchased on a discount basis. The interest rate shown has
been adjusted to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes approximates identified
cost. The aggregate gross unrealized appreciation is $159,211,339 and the
aggregate gross unrealized depreciation is $5,170,616, resulting in net
unrealized appreciation of $154,040,723.
FORWARD FOREIGN CURRENCY CONTRACTS OPEN AT FEBRUARY 28, 1998:
<TABLE>
<CAPTION>
CONTRACTS TO IN DELIVERY UNREALIZED
DELIVER EXCHANGE FOR DATE DEPRECIATION
- -------------------------------------------------------
<S> <C> <C> <C>
$ 1,005,539 CAD 1,428,368 03/02/98 $ (2,330)
AUD 1,485,397 $ 996,702 03/04/98 (12,180)
AUD 1,416,137 $ 961,132 03/05/98 (708)
$ 952,944 FRF 5,763,122 03/31/98 (6,153)
--------
Total unrealized depreciation..... $ (21,371)
--------
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
SUMMARY OF INVESTMENTS FEBRUARY 28, 1998
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Cable & Telecommunications........................................................ $ 4,218,701 1.1%
Electrical Equipment.............................................................. 7,652,887 1.9
Media Group....................................................................... 5,308,595 1.3
Telecommunication Equipment....................................................... 38,614,738 9.7
Transportation.................................................................... 7,408,473 1.9
U.S. Government Agency............................................................ 17,897,211 4.5
Utilities - Electric.............................................................. 72,925,184 18.3
Utilities - Natural Gas........................................................... 24,356,448 6.1
Utilities - Telecommunications.................................................... 173,594,328 43.7
Utilities - Water................................................................. 9,566,716 2.4
Wireless Communication............................................................ 37,202,955 9.4
------------ -----
$398,746,236 100.3%
------------ -----
------------ -----
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Common Stocks..................................................................... $380,849,025 95.8%
Short-Term Investment............................................................. 17,897,211 4.5
------------ -----
$398,746,236 100.3%
------------ -----
------------ -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 28, 1998
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $244,705,513).............................................................. $398,746,236
Cash.......................................................................................... 983,196
Receivable for:
Investments sold.......................................................................... 1,957,833
Dividends................................................................................. 464,964
Shares of beneficial interest sold........................................................ 245,914
Foreign withholding taxes reclaimed....................................................... 201,268
Deferred organizational expenses.............................................................. 46,006
Prepaid expenses and other assets............................................................. 45,550
------------
TOTAL ASSETS............................................................................. 402,690,967
------------
LIABILITIES:
Payable for:
Investments purchased..................................................................... 4,207,137
Shares of beneficial interest repurchased................................................. 300,150
Plan of distribution fee.................................................................. 263,085
Investment management fee................................................................. 198,760
Accrued expenses and other payables........................................................... 115,215
------------
TOTAL LIABILITIES........................................................................ 5,084,347
------------
NET ASSETS............................................................................... $397,606,620
------------
------------
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................................................... $251,769,724
Net unrealized appreciation................................................................... 154,030,844
Accumulated undistributed net investment income............................................... 135,281
Distributions in excess of net realized gain.................................................. (8,329,229)
------------
NET ASSETS............................................................................... $397,606,620
------------
------------
CLASS A SHARES:
Net Assets.................................................................................... $947,894
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)..................................... 62,773
NET ASSET VALUE PER SHARE................................................................ $15.10
------------
------------
MAXIMUM OFFERING PRICE PER SHARE,
(NET ASSET VALUE PLUS 5.54% OF NET ASSET VALUE)........................................ $15.94
------------
------------
CLASS B SHARES:
Net Assets.................................................................................... $396,483,338
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)..................................... 26,269,587
NET ASSET VALUE PER SHARE................................................................ $15.09
------------
------------
CLASS C SHARES:
Net Assets.................................................................................... $160,984
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)..................................... 10,684
NET ASSET VALUE PER SHARE................................................................ $15.07
------------
------------
CLASS D SHARES:
Net Assets.................................................................................... $14,404
Shares Outstanding (UNLIMITED AUTHORIZED, $.01 PAR VALUE)..................................... 953
NET ASSET VALUE PER SHARE................................................................ $15.11
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED FEBRUARY 28, 1998*
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $755,487 foreign withholding tax)............................................ $ 9,930,067
Interest....................................................................................... 552,834
-----------
TOTAL INCOME.............................................................................. 10,482,901
-----------
EXPENSES
Plan of distribution fee (Class A shares)...................................................... 892
Plan of distribution fee (Class B shares)...................................................... 3,262,820
Plan of distribution fee (Class C shares)...................................................... 606
Investment management fee...................................................................... 2,368,987
Transfer agent fees and expenses............................................................... 477,783
Custodian fees................................................................................. 174,398
Professional fees.............................................................................. 71,725
Shareholder reports and notices................................................................ 68,894
Registration fees.............................................................................. 47,917
Organizational expenses........................................................................ 34,018
Foreign exchange provisional tax............................................................... 21,805
Trustees' fees and expenses.................................................................... 15,430
Other.......................................................................................... 18,455
-----------
TOTAL EXPENSES............................................................................ 6,563,730
-----------
NET INVESTMENT INCOME..................................................................... 3,919,171
-----------
NET REALIZED AND UNREALIZED GAIN:
Net realized gain (loss) on:
Investments................................................................................ 2,951,676
Foreign exchange transactions.............................................................. (41,048)
-----------
NET GAIN.................................................................................. 2,910,628
-----------
Net change in unrealized appreciation/depreciation on:
Investments................................................................................ 78,620,451
Translation of forward foreign currency contracts, other assets and liabilities denominated
in foreign currencies.................................................................... (10,153)
-----------
NET APPRECIATION.......................................................................... 78,610,298
-----------
NET GAIN.................................................................................. 81,520,926
-----------
NET INCREASE................................................................................... $85,440,097
-----------
-----------
</TABLE>
- ---------------------
* Class A, Class C and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
FEBRUARY 28, 1998* FEBRUARY 28, 1997
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income........................................................... $ 3,919,171 $ 2,999,014
Net realized gain............................................................... 2,910,628 6,159,318
Net change in unrealized appreciation........................................... 78,610,298 33,486,202
---------------------- ----------------------
NET INCREASE............................................................... 85,440,097 42,644,534
---------------------- ----------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income
Class A shares.............................................................. (3,553) --
Class B shares.............................................................. (3,902,063) (3,680,883)
Class C shares.............................................................. (280) --
Class D shares.............................................................. (61) --
Net realized gain
Class A shares.............................................................. (24,201) --
Class B shares.............................................................. (16,373,274) --
Class C shares.............................................................. (4,095) --
Class D shares.............................................................. (315) --
---------------------- ----------------------
TOTAL DIVIDENDS AND DISTRIBUTIONS.......................................... (20,307,842) (3,680,883)
---------------------- ----------------------
Net decrease from transactions in shares of beneficial interest................. (19,765,137) (47,071,634)
---------------------- ----------------------
NET INCREASE (DECREASE).................................................... 45,367,118 (8,107,983)
NET ASSETS:
Beginning of period............................................................. 352,239,502 360,347,485
---------------------- ----------------------
END OF PERIOD
(INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $135,281 AND $163,204,
RESPECTIVELY)............................................................... $ 397,606,620 $ 352,239,502
---------------------- ----------------------
---------------------- ----------------------
</TABLE>
- ---------------------
* Class A, Class C and Class D shares were issued July 28, 1997.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998
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's investment objective is to
seek both capital appreciation and current income. The Fund seeks to achieve its
objective by investing in equity and fixed income securities of companies,
issued by issuers worldwide, which are engaged in the utilities industry. The
Fund was organized as a Massachusetts business trust on October 22, 1993 and
commenced operations on May 31, 1994. On July 28, 1997, the Fund commenced
offering three additional classes of shares, with the then current shares
designated as Class B shares.
The Fund offers Class A shares, Class B shares, Class C shares and Class D
shares. The four classes are substantially the same except that most Class A
shares are subject to a sales charge imposed at the time of purchase, some Class
A shares, and most Class B shares and Class C shares are subject to a contingent
deferred sales charge imposed on shares redeemed within one year, six years and
one year, respectively. Class D shares are not subject to a sales charge.
Additionally, Class A shares, Class B shares and Class C shares incur
distribution expenses.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ from
those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at its
latest sale price on that exchange prior to the time when assets are valued; if
there were no sales that day, the security is valued at the latest bid price (in
cases where securities are traded on more than one exchange, the securities are
valued on the exchange designated as the primary market pursuant to procedures
adopted by the Trustees); (2) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (3) when market
quotations are not readily available, including circumstances under which it is
determined by Dean Witter InterCapital Inc. (the "Investment Manager") that sale
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 portfolio securities may be valued by an outside pricing service
approved by the Trustees. The pricing service may utilize a matrix system
incorporating security quality, maturity and coupon as the evaluation
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
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 and other distributions are recorded on the ex-dividend date
except for certain dividends on foreign securities which are recorded as soon as
the Fund is informed after the ex-dividend date. Discounts are accreted over the
life of the respective securities. Interest income is accrued daily.
C. MULTIPLE CLASS ALLOCATIONS -- Investment income, expenses (other than
distribution fees), and realized and unrealized gains and losses are allocated
to each class of shares based upon the relative net asset value on the date such
items are recognized. Distribution fees are charged directly to the respective
class.
D. FOREIGN CURRENCY TRANSLATION -- The books and records of the Fund are
maintained in U.S. dollars as follows: (1) the foreign currency market value of
investment securities, other assets and liabilities and forward foreign currency
contracts are translated at the exchange rates prevailing at the end of the
period; and (2) purchases, sales, income and expenses are translated at the
exchange rates prevailing on the respective dates of such transactions. The
resultant exchange gains and losses are included in the Statement of Operations
as realized and unrealized gain/loss on foreign exchange transactions. Pursuant
to U.S. Federal income tax regulations, certain foreign exchange gains/losses
included in realized and unrealized gain/loss are included in or are a reduction
of ordinary income for federal income tax purposes. The Fund does not isolate
that portion of the results of operations arising as a result of changes in the
foreign exchange rates from the changes in the market prices of the securities.
E. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward foreign
currency contracts which are valued daily at the appropriate exchange rates. The
resultant unrealized exchange gains and losses are included in the Statement of
Operations as unrealized foreign currency gain or loss and in the Statement of
Assets and Liabilities as part of the related foreign currency
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
denominated asset or liability. The Fund records realized gains or losses on
delivery of the currency or at the time the forward contract is extinguished
(compensated) by entering into a closing transaction prior to delivery.
F. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
G. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions to its shareholders on the ex-dividend date. The amount of
dividends and distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations which may
differ from generally accepted accounting principles. These "book/tax"
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are reclassified
within the capital accounts based on their federal tax-basis treatment;
temporary differences do not require reclassification. Dividends and
distributions which exceed net investment income and net realized capital gains
for financial reporting purposes but not for tax purposes are reported as
dividends in excess of net investment income or distributions in excess of net
realized capital gains. To the extent they exceed net investment income and net
realized capital gains for tax purposes, they are reported as distributions of
paid-in-capital.
H. ORGANIZATIONAL EXPENSES -- The Investment Manager paid the organizational
expenses of the Fund in the amount of approximately $174,000 which have been
reimbursed for the full amount thereof. Such expenses have been deferred and are
being amortized on the straight-line method over a period not to exceed five
years from the commencement of operations.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement, the Fund pays the Investment
Manager a management fee, accrued daily and payable monthly, by applying the
annual rate 0.65% to the net assets of the Fund determined as of the close of
each business day. Effective May 1, 1997, the Agreement was amended to reduce
the annual rate to 0.625% of the portion of daily net assets exceeding $500
million.
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
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
all personnel, including officers of the Fund who are employees of the
Investment Manager. The Investment Manager also bears the cost of telephone
services, heat, light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted a
Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan
provides that the Fund will pay the Distributor a fee which is accrued daily and
paid monthly at the following annual rates: (i) Class A -- up to 0.25% of the
average daily net assets of Class A; (ii) Class B -- 1.0% of the lesser of: (a)
the average daily aggregate gross sales of the Class B shares since the
inception of the Fund (not including reinvestment of dividend or capital gain
distributions) less the average daily aggregate net asset value of the Class B
shares redeemed since the Fund's inception upon which a contingent deferred
sales charge has been imposed or waived; or (b) the average daily net assets of
Class B; and (iii) Class C -- up to 1.0% of the average daily net assets of
Class C. In the case of Class A shares, amounts paid under the Plan are paid to
the Distributor for services provided. In the case of Class B and Class C
shares, amounts paid under the Plan are paid to the Distributor for services
provided and the expenses borne by it and others in the distribution of the
shares of these Classes, including the payment of commissions for sales of these
Classes and incentive compensation to, and expenses of, the account executives
of Dean Witter Reynolds Inc. ("DWR"), an affiliate of the Investment Manager and
Distributor, and others who engage in or support distribution of the shares or
who service shareholder accounts, including overhead and telephone expenses;
printing and distribution of prospectuses and reports used in connection with
the offering of these shares to other than current shareholders; and
preparation, printing and distribution of sales literature and advertising
materials. In addition, the Distributor may utilize fees paid pursuant to the
Plan, in the case of Class B shares, to compensate DWR and other selected
broker-dealers for their opportunity costs in advancing such amounts, which
compensation would be in the form of a carrying charge on any unreimbursed
expenses.
In the case of Class B shares, provided that the Plan continues in effect, any
cumulative expenses incurred by the Distributor but not yet recovered may be
recovered through the payment of future distribution fees from the Fund pursuant
to the Plan and contingent deferred sales charges paid by investors upon
redemption of Class B shares. Although there is no legal obligation for the Fund
to pay expenses incurred in excess of payments made to the Distributor under the
Plan and the proceeds of contingent deferred sales charges paid by investors
upon redemption of shares, if for any
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
reason the Plan is terminated, the Trustees will consider at that time the
manner in which to treat such expenses. The Distributor has advised the Fund
that such excess amounts, including carrying charges, totaled $10,016,830 at
February 28, 1998.
In the case of Class A shares and Class C shares, expenses incurred pursuant to
the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily
net assets of Class A or Class C, respectively, will not be reimbursed by the
Fund through payments in any subsequent year, except that expenses representing
a gross sales credit to account executives may be reimbursed in the subsequent
calendar year. For the period ended February 28, 1998, the distribution fee was
accrued for Class A shares and Class C shares at the annual rate of 0.24% and
1.0%, respectively.
The Distributor has informed the Fund that for the period ended February 28,
1998, it received contingent deferred sales charges from certain redemptions of
the Fund's Class B shares of $580,315 and received $9,859 in front-end sales
charges from sales of the Fund's Class A shares. The respective shareholders pay
such charges which are not an expense of the Fund.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the year ended February 28, 1998 aggregated
$49,156,691 and $97,075,866, respectively.
For the year ended February 28, 1998, the Fund incurred brokerage commissions of
$7,195 with DWR for portfolio transactions executed on behalf of the Fund. At
February 28, 1998, the Fund's payable for investments purchased included
unsettled trades with DWR of $131,500.
For the period May 31, 1997 through February 28, 1998, the Fund incurred
brokerage commissions with Morgan Stanley & Co., Inc., an affiliate of the
Investment Manager since May 31, 1997, of $79,146, for portfolio transactions
executed on behalf of the Fund. At February 28, 1998, the Fund's receivable for
investments sold included unsettled trades with Morgan Stanley & Co., Inc. of
$952,944.
Dean Witter Trust FSB, an affiliate of the Investment Manager and Distributor,
is the Fund's transfer agent. At February 28, 1998, the Fund had transfer agent
fees and expenses payable of approximately $3,000.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
5. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
FEBRUARY 28, 1998 FEBRUARY 28, 1997
---------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- -------------- ----------- ------------
<S> <C> <C> <C> <C>
CLASS A SHARES*
Sold............................................................. 64,407 $ 867,738 -- --
Reinvestment of dividends and distributions...................... 1,974 26,818 -- --
Redeemed......................................................... (3,608) (51,558) -- --
----------- -------------- ----------- ------------
Net increase - Class A........................................... 62,773 842,998 -- --
----------- -------------- ----------- ------------
CLASS B SHARES
Sold............................................................. 5,287,804 71,906,678 4,354,550 $ 51,632,264
Reinvestment of dividends and distributions...................... 1,337,025 18,124,561 284,415 3,276,573
Redeemed......................................................... (8,174,924) (110,798,834) (8,631,939) (101,980,471)
----------- -------------- ----------- ------------
Net decrease - Class B........................................... (1,550,095) (20,767,595) (3,992,974) (47,071,634)
----------- -------------- ----------- ------------
CLASS C SHARES*
Sold............................................................. 10,598 145,286 -- --
Reinvestment of dividends and distributions...................... 311 4,213 -- --
Redeemed......................................................... (225) (3,358) -- --
----------- -------------- ----------- ------------
Net increase - Class C........................................... 10,684 146,141 -- --
----------- -------------- ----------- ------------
CLASS D SHARES*
Sold............................................................. 926 12,944 -- --
Reinvestment of dividends and distributions...................... 27 375 -- --
----------- -------------- ----------- ------------
Net increase - Class D........................................... 953 13,319 -- --
----------- -------------- ----------- ------------
Net decrease in Fund............................................. (1,475,685) $ (19,765,137) (3,992,974) $(47,071,634)
----------- -------------- ----------- ------------
----------- -------------- ----------- ------------
</TABLE>
- ---------------------
* For the period July 28, 1997 (issue date) through February 28, 1998.
6. 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 $8,166,000 and $11,000,
respectively, during fiscal 1998.
As of February 28, 1998, the Fund had temporary book/tax differences primarily
attributable to post-October losses and permanent book/tax differences
attributable to foreign currency losses. To reflect reclassifications arising
from the permanent differences, accumulated undistributed net investment income
was charged and distributions in excess of net realized gain was credited
$41,137.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS FEBRUARY 28, 1998, CONTINUED
7. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS
The Fund may enter into forward foreign currency contracts ("forward contracts")
to facilitate settlement of foreign currency denominated portfolio transactions
or to manage foreign currency exposure associated with foreign currency
denominated securities.
Forward contracts involve elements of market risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The Fund bears the risk of
an unfavorable change in the foreign exchange rates underlying the forward
contracts. Risks may also arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their contracts.
At February 28, 1998, there were outstanding forward contracts to facilitate
settlement of foreign currency denominated portfolio transactions.
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE
PERIOD
MAY 31,
1994*
FOR THE YEAR ENDED FEBRUARY 28, THROUGH
-------------------------------- FEBRUARY
1998(++)++ 1997 1996** 28, 1995
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS B SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period.............................. $ 12.66 $ 11.33 $ 9.80 $ 10.00
---------- --------- --------- ----------
Net investment income................ 0.15 0.10 0.18 0.13
Net realized and unrealized gain
(loss).............................. 3.05 1.35 1.64 (0.21)
---------- --------- --------- ----------
Total from investment operations..... 3.20 1.45 1.82 (0.08)
---------- --------- --------- ----------
Less dividends and distributions
from:
Net investment income............. (0.15) (0.12) (0.16) (0.12)
Net realized gain................. (0.62) -- (0.13) --
---------- --------- --------- ----------
Total dividends and distributions.... (0.77) (0.12) (0.29) (0.12)
---------- --------- --------- ----------
Net asset value, end of period....... $ 15.09 $ 12.66 $ 11.33 $ 9.80
---------- --------- --------- ----------
---------- --------- --------- ----------
TOTAL INVESTMENT RETURN+............. 26.06% 12.91% 18.76% (0.87)%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses............................. 1.80% 1.82% 1.87% 1.97%(2)
Net investment income................ 1.08% 0.85% 1.66% 1.83%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands........................... $396,483 $352,240 $360,347 $337,600
Portfolio turnover rate.............. 14% 10% 16% 2%(1)
Average commission rate paid......... $0.0024 $0.0071 -- --
</TABLE>
- ---------------------
* Commencement of operations.
** Year ended February 29.
++ Prior to July 28, 1997, the Fund issued one class of shares. All shares
held prior to that date have been designated Class B shares.
(++) The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
FEBRUARY 28,
1998(++)
- ----------------------------------------------------------------------------------------
<S> <C>
CLASS A SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 13.77
------
Net investment income................................................. 0.07
Net realized and unrealized gain...................................... 1.76
------
Total from investment operations...................................... 1.83
------
Less dividends and distributions from:
Net investment income............................................... (0.07)
Net realized gain................................................... (0.43)
------
Total dividends and distributions..................................... (0.50)
------
Net asset value, end of period........................................ $ 15.10
------
------
TOTAL INVESTMENT RETURN+.............................................. 13.74%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.18%(2)
Net investment income................................................. 0.88%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $948
Portfolio turnover rate............................................... 14%
Average commission rate paid.......................................... $0.0024
CLASS C SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 13.77
------
Net investment income................................................. 0.01
Net realized and unrealized gain...................................... 1.76
------
Total from investment operations...................................... 1.77
------
Less dividends and distributions from:
Net investment income.............................................. (0.04)
Net realized gain.................................................. (0.43)
------
Total dividends and distributions..................................... (0.47)
------
Net asset value, end of period........................................ $ 15.07
------
------
TOTAL INVESTMENT RETURN+.............................................. 13.24%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 1.93%(2)
Net investment income................................................. 0.06%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $161
Portfolio turnover rate............................................... 14%
Average commission rate paid.......................................... $0.0024
</TABLE>
- ---------------------
* The date shares were first issued.
(++) The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FINANCIAL HIGHLIGHTS, CONTINUED
<TABLE>
<CAPTION>
FOR THE PERIOD
JULY 28, 1997*
THROUGH
FEBRUARY 28,
1998(++)
- ----------------------------------------------------------------------------------------
<S> <C>
CLASS D SHARES
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.................................. $ 13.77
------
Net investment income................................................. 0.09
Net realized and unrealized gain...................................... 1.76
------
Total from investment operations...................................... 1.85
------
Less dividends and distributions from:
Net investment income.............................................. (0.08)
Net realized gain.................................................. (0.43)
------
Total dividends and distributions..................................... (0.51)
------
Net asset value, end of period........................................ $ 15.11
------
------
TOTAL INVESTMENT RETURN+.............................................. 13.90%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.............................................................. 0.92%(2)
Net investment income................................................. 1.04%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands............................... $ 14
Portfolio turnover rate............................................... 14%
Average commission rate paid.......................................... $0.0024
</TABLE>
- ---------------------
* The date shares were first issued.
(++) The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
<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, 1998, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for each of the periods
presented, in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at
February 28, 1998 by correspondence with the custodian and brokers and the
application of alternative auditing procedures where confirmations from brokers
were not received, provide a reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
APRIL 13, 1998
<PAGE>
DEAN WITTER GLOBAL UTILITIES FUND
FEDERAL TAX NOTICE (UNAUDITED)
1998 FEDERAL TAX NOTICE
For the year ended February 28, 1998, the Fund paid to shareholders the
following per share amounts from long-term capital gains. These distributions
are taxable as 28% rate gains or 20% rate gains, as indicated below:
<TABLE>
<CAPTION>
PER SHARE
------------------------------------------
CLASS A CLASS B CLASS C CLASS D
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Portion of long-term capital gains
taxable as:
28% rate gain......................... -- $0.16 -- --
20% rate gain......................... $0.43 0.43 $0.43 $0.43
--------- --------- --------- ---------
Total................................... $0.43 $0.59 $0.43 $0.43
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
For the year ended February 28, 1998, 75.01% of the income dividends qualified
for the dividends received deduction available to corporations. In addition, the
Fund has elected, pursuant to Section 853 of the Internal Revenue Code, to pass
through foreign taxes of $0.03 per share to its shareholders, of which 100%
would be allowable as a credit. The Fund generated net foreign source income of
$0.11 per share with respect to this election.
<PAGE>
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Barry Fink
Vice President, Secretary and General Counsel
Edward F. Gaylor
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Dean Witter Trust FSB
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and
trustees, fees, expenses and other pertinent information, please see the
prospectus of the Fund.
This report is not authorized for distribution to prospective investors in
the Fund unless preceded or accompanied by an effective prospectus.
DEAN WITTER
GLOBAL UTILITIES
FUND
[PHOTO]
ANNUAL REPORT
FEBRUARY 28, 1998
