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Previous: EATON VANCE MUNICIPALS TRUST II, N-30D, 1995-10-02 |
Next: FLORIDA INSURED TAX FREE PORTFOLIO, N-30D, 1995-10-02 |
<PAGE> 1
The Eaton Vance Municipals Trust II
For the Portfolios:
Florida Insured Tax Free Fund
Hawaii Tax Free Fund
Kansas Tax Free Fund
[LOGO]
Semi-Annual Shareholder Report
July 31, 1995
Portfolio Investment Adviser
Boston Management and Research
24 Federal Street
Boston, MA 02110
Fund Administrator
Eaton Vance Management
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110
Transfer Agent
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
<PAGE> 2
FLORIDA INSURED TAX FREE PORTFOLIO
PORTFOLIO OF INVESTMENTS - JULY 31, 1995 (UNAUDITED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS- 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ESCROWED - 3.9%
Aaa AAA $ 500 Gainesville Florida
Utility System, 8.125%,
10/1/14 $ 640,190
----------
HOUSING - 13.7%
Aaa AAA $ 500 Duval County HFA
SFMR (GNMA Backed),
6.70%, 10/1/26 (AMT) $ 503,845
Aaa NR 750 Escambia HFA SFMR
(GNMA Backed), 7.00%,
4/1/28 (AMT) 772,193
NR AAA 1,000 Pinellas County HFA
SFMR (GNMA Backed),
6.70%, 2/1/28 (AMT) 1,009,560
----------
$2,285,598
----------
INSURED EDUCATION - 2.3%
Aaa AAA $ 400 University of Florida
(MBIA), 5.50%, 7/1/23 $ 380,828
----------
INSURED GENERAL
OBLIGATION - 4.0%
Aaa AAA $ 750 Puerto Rico (MBIA),
5.00%, 7/1/21 $ 670,020
----------
INSURED HEALTHCARE - 6.4%
Aaa AAA $1,200 Tampa Allegany Health
System- St. Joseph's
(MBIA), 5.125%,
12/1/23 $1,062,132
----------
INSURED HOSPITAL - 3.9%
Aaa AAA $ 450 Dade Florida Public
Facilities, Jackson Memorial
Hospital, (MBIA), 5.625%,
6/1/18 $ 430,200
Aaa AAA 200 Dade Florida Public
Facilities, Jackson Memorial
Hospital, (MBIA), 4.875%,
6/1/15 174,096
Aaa AAA 50 Hillsborough County
Hospital Authority, Tampa
General Hospital (FSA),
6.375%, 10/1/13 51,836
----------
$ 656,132
----------
INSURED HOUSING - 3.1%
Aaa Aaa $ 500 FL HFA Maitland Club
Apartments Project
(AMBAC), 6.875%,
8/1/26 (AMT) $ 513,385
----------
INSURED POLLUTION
CONTROL REVENUE - 7.1%
Aaa AAA $ 445 Citrus County -
FL Power & Light
(MBIA), 6.35%, 2/1/22 $ 462,279
Aaa AAA 750 Escambia County -
Gulf Power (MBIA),
5.80%, 6/1/23 723,855
----------
$1,186,134
----------
INSURED SOLID WASTE - 0.6%
Aaa AAA $ 100 Broward County Solid
Waste System (MBIA),
6.00%, 7/1/13 (AMT) $ 100,215
----------
INSURED SPECIAL
TAX REVENUES - 20.9%
Aaa AAA $ 450 Escambia County (FGIC),
5.80%, 1/1/15 $ 441,752
Aaa AAA 150 Florida State Department
of Natural Resources
(FSA), 5.80%, 7/1/13 148,182
Aaa AAA 1,225 Florida State Department of
Environmental Preservation
(MBIA), 4.75%, 7/1/09 1,127,466
Aaa AAA 745 Jacksonville Florida Sales
Tax, River City Project
(FGIC), 5.375%, 10/1/18 688,812
</TABLE>
15
<PAGE> 3
FLORIDA INSURED TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED SPECIAL
TAX REVENUES - (continued)
Aaa AAA 250 Orange County Florida
Tourist Development
(MBIA), 6.00%, 10/1/24 247,258
Aaa AAA 795 St. Petersburg Excise Tax
(FGIC), 5.00%, 10/1/16 711,740
Aaa AAA 340 Sunrise Florida Public
Facilities (MBIA), 0%,
10/1/15 101,434
-----------
$ 3,466,644
-----------
INSURED TRANSPORTATION - 10.1%
Aaa AAA $ 700 Florida State Turnpike
Authority (FGIC), 5.00%,
7/1/19 $ 614,089
Aaa AAA 50 Greater Orlando Aviation
Authority (FGIC), 6.375%,
10/1/21 (AMT) 51,196
Aaa AAA 1,000 Lee County Florida
Transportation Facilities
(MBIA), 5.75%, 10/1/22 970,510
Aaa AAA 50 Orlando & Orange County
Expressway Authority Junior
Lien (FGIC), 5.125%,
7/1/20 44,436
-----------
$ 1,680,231
-----------
INSURED UTILITIES - 6.5%
Aaa AAA $ 895 FL Municipal Power Authority,
Stanton II Project (AMBAC),
4.50%, 10/1/27 $ 700,400
Aaa AAA 50 Key West Florida Utility
(AMBAC), 6.75%,
10/1/13 53,831
Aaa AAA 305 New Smyrna Beach Florida
Utility System (FGIC),
5.00%, 10/1/19 268,086
Aaa AAA 50 Puerto Rico Electric
Power Authority Revenue
Bonds-Stripes, (FSA),
Variable, 7/1/02 (1) 54,165
-----------
$ 1,076,482
-----------
INSURED WATER
& SEWER - 17.5%
Aaa AAA $ 50 Broward County Water
and Sewer Utility (AMBAC),
5.00%, 10/1/18 $ 44,468
Aaa AAA 75 City of Cocoa Water and
Sewer System (AMBAC),
5.00%, 10/1/23 65,778
Aaa AAA 735 Enterprise Community
Water & Sewer (MBIA),
6.125%, 5/1/24 740,542
Aaa AAA 75 City of Key West Sewer
(FGIC), 5.70%, 10/1/26 71,735
Aaa AAA 70 City of North Port Utility
System (FGIC), 6.25%,
10/1/17 71,758
Aaa AAA 500 City of North Port Utility
System (FGIC), 6.25%,
10/1/22 510,780
Aaa AAA 155 Sanford Florida Water &
Sewer (AMBAC), 4.50%,
10/1/21 125,012
Aaa AAA 400 Titusville Florida Water &
Sewer (MBIA), 6.00%,
10/1/24 401,572
Aaa AAA 1,000 Vero Beach Water &
Sewer (FGIC), 5.00%,
12/1/21 877,960
-----------
$ 2,909,605
TOTAL TAX-EXEMPT INVESTMENTS -----------
(IDENTIFIED COST $15,731,571) $16,627,596
===========
</TABLE>
16
<PAGE> 4
FLORIDA INSURED TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------------------
(1) The above designated securities have been issued as inverse floater bonds.
The Portfolio invests primarily in debt securities issued by Florida
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 82.4% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentages by financial
institution were as follows at July 31, 1995:
<S> <C>
AMBAC, Inc. (AMBAC) 9.0%
Financial Guaranty Insurance Corp. (FGIC) 26.3%
Financial Security Insurance Inc. (FSA) 1.5%
Municipal Bond Investors Assurance Corp. (MBIA) 45.6%
----
82.4%
====
</TABLE>
See notes to financial statements
17
<PAGE> 5
KANSAS TAX FREE PORTFOLIO
PORTFOLIO OF INVESTMENTS - JULY 31, 1995 (UNAUDITED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS- 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 1.0%
NR BBB- $100 Puerto Rico Industrial, Tourist,
Educational, Medical and
Higher Education Bonds,
(Polytechnic University),
5.70%, 8/1/13 $ 92,081
--------
ELECTRIC UTILITY - 2.5%
NR BBB $100 Guam Power Authority
Revenue Bonds, 5.25%,
10/1/13 $ 88,727
NR BBB 150 Guam Power Authority
Revenue Bonds, 6.625%,
10/1/14 152,048
--------
$240,775
--------
GENERAL OBLIGATION
LOCAL - 4.5%
Aa NR $150 Shawnee County, 5.75%,
9/1/13 $148,496
Aa AA 170 City of Witchita, 4.00%,
9/1/09 142,419
A1 AA- 50 City of Olathe, 5.00%,
10/1/06 48,012
Baa1 A 100 Puerto Rico Public
Building Authority Bonds,
5.50%, 7/1/21 91,624
--------
$430,551
--------
GENERAL OBLIGATION
SCHOOL DISTRICT - 6.2%
Aa NR $400 Douglas County, (Lawrence),
USD No. 497, 6.00%,
9/1/15 $406,364
Aa AA 100 Johnson and Miami Counties,
(Blue Valley), USD No. 229,
5.125%, 10/1/13 92,368
Aa NR 100 Riley County, (Manhattan),
USD No. 383, 5.50%,
11/1/14 96,651
--------
$595,383
--------
HOSPITALS - 8.6%
A NR $250 City of Lawrence,
(Lawrence Memorial),
Revenue Bonds,
6.20%, 7/1/19 $251,000
Aa NR 670 Shawnee County, (Sisters
of Charity), Revenue Bonds,
5.00%, 12/1/23 571,142
--------
$822,142
--------
HOUSING - 22.4%
Aaa AAA $230 City of Kansas City,
MFHRB (FHA Insured-
Rainbow Towers), 6.70%,
7/1/23 $230,646
NR AAA 250 City of Olathe, Kansas,
MFHRB, (FNMA)
Program Deerfield Apart-
ments, 6.45%, 6/1/19 251,518
Aaa NR 215 Cities of Olathe and
of Labette,
CSFMRB (GNMA),
8.10%, 8/1/23 235,638
NR AA 250 Puerto Rico Housing
Finance Corporation,
MFMRB 7.50%,
4/1/22 263,310
Aaa AAA 200 Sedgwick and Shawnee
Counties, CSFMRB
(GNMA), 7.50%,
12/1/09 207,408
Aaa AAA 135 Sedgwick and Shawnee
Counties, CSFMRB
(GNMA), 7.50%,
12/1/10 140,000
</TABLE>
21
<PAGE> 6
KANSAS TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOUSING - (CONTINUED)
Aaa NR 240 Sedgwick and Shawnee
Counties, CSFMRB
(GNMA), 7.75%, 11/1/24
(2) 266,765
Aaa NR 480 Sedgwick and Shawnee
Counties, CSFMRB
(GNMA), 8.00%, 5/1/25 538,685
----------
$2,133,970
----------
INDUSTRIAL DEVELOPMENT
REVENUE - 1.9%
Aaa NR $100 Puerto Rico I.M.E.
(American Home Products),
5.10%, 12/1/18 $ 88,085
Baa3 BB+ 100 Puerto Rico Port
Authority, (American
Airlines), 6.30%, 6/1/23 97,055
----------
$ 185,140
----------
INSURED COLLEGE AND
UNIVERSITY - 4.8%
Aaa AAA $500 University of Puerto
Rico (MBIA), 5.25%,
6/1/25 $ 456,545
----------
INSURED ELECTRIC - 4.0%
Aaa AAA $255 City of Burlington, PCR
(Kansas Gas & Electric Co.)
(MBIA), 7.00%, 6/1/31 $ 277,942
Aaa AAA 100 Puerto Rico Electric Power
Authority, Power Revenue
Bonds (FSA), Residual
Interest Bonds, Variable
7/1/02 (1) 108,331
----------
$ 386,273
----------
INSURED GENERAL - 5.3%
Aaa AAA $150 City of Garnett, Combined
Utility Revenue Bonds
(MBIA), 6.00%, 10/1/17 $ 150,753
Aaa AAA 200 City of Kansas City, Utility
System Revenue Bonds
(FGIC), 6.375%, 9/1/23 207,468
Aaa AAA 150 Kansas Development Finance
Authority, Revenue Bonds
(MBIA), 5.90%, 10/1/09 152,211
----------
$ 510,432
----------
INSURED GENERAL
OBLIGATIONS SCHOOL
DISTRICT - 19.9%
Aaa AAA $150 Atchison County, USD
No. 409, (CGIC), 5.375%,
9/1/15 $ 142,659
Aaa AAA 200 Johnson and Miami
Counties, (Blue Valley),
USD No. 229, (FGIC),
4.90%, 9/1/10 182,248
Aaa AAA 350 Johnson County, (Olathe),
USD No. 233 (AMBAC),
5.625%, 9/1/11 347,603
Aaa AAA 235 McPherson County,
(McPherson), USD No.
418, (CGIC), 6.00%,
9/1/11 237,277
Aaa AAA 200 Sedgwick County, USD
No. 266, (FGIC), 5.25%,
9/1/13 186,498
Aaa AAA 250 Sedgwick County, USD
No. 267, (AMBAC),
6.15%, 11/1/09 260,385
Aaa AAA 230 Sedgwick County, USD
No. 267, (AMBAC),
6.15%, 11/1/10 238,646
Aaa AAA 165 Shawnee County, (Seaman),
USD No. 345, (MBIA),
5.75%, 9/1/11 164,819
</TABLE>
22
<PAGE> 7
KANSAS TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED GENERAL
OBLIGATIONS SCHOOL
DISTRICT - (Continued)
Aaa AAA 150 Sumner County, (Belle Plaine),
USD No. 357, (AMBAC),
5.55%, 9/1/13 144,527
----------
$1,904,662
----------
INSURED HOSPITALS - 4.2%
Aaa AAA $200 City of Olathe, Health
Facilities Revenue Bonds,
(Olathe Medical Ctr)
(AMBAC), 6.00%,
9/1/11 $ 201,422
Aaa AAA 200 City of Olathe, Health
Facilities Revenue Bonds,
(Evangelical Lutheran
Good Samaritan Society)
(AMBAC), 6.00%,
5/1/19 201,552
----------
$ 402,974
----------
INSURED TOLLS AND
TURNPIKES - 0.5%
Aaa AAA $50 Kansas Turnpike Authority,
Turnpike Revenue Bonds
(AMBAC)5.25%, 9/1/17 $ 45,159
----------
INSURED WATER
AND SEWER - 2.9%
Aaa AAA $200 City of Emporia, Water
System Revenue Bonds
(AMBAC), 5.875%,
12/1/14 $ 199,866
Aaa AAA 80 City of Salina, Water and
Sewage Systems, Revenue
Bonds, (MBIA), 5.25%,
9/1/12 74,203
----------
$ 274,069
----------
TRANPORTATION - 9.2%
NR BBB $100 Guam Airport Authority
General Revenue Bonds,
6.50%, 10/1/23 $ 99,349
Aa AA 480 State of Kansas Department
of Transportation Highway
Revenue Bonds, 5.375%,
3/1/13 451,632
Aa AA 110 State of Kansas Department
of Transportation Highway
Revenue Bonds, 4.625%,
9/1/06 102,870
Baa1 A 250 Puerto Rico Highway and
Transportation Authority,
Highway Revenue Bonds,
5.25%, 7/1/20 220,335
----------
$ 874,186
----------
WATER AND SEWER - 2.1%
Aa AA+ $200 Water District No. 1 of
Johnson County, Water
Revenue Bonds, 5.75%,
12/1/19 $ 199,407
----------
TOTAL TAX-EXEMPT INVESTMENTS ----------
(IDENTIFIED COST $9,309,873) $9,553,749
==========
</TABLE>
(1) The above designated securities have been issued as inverse floater bonds.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
The Portfolio invests primarily in debt securities issued by Kansas
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 41.6% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 1.1% to 17.2% of total investments.
See notes to financial statements
23
<PAGE> 8
HAWAII TAX FREE PORTFOLIO
PORTFOLIO OF INVESTMENTS - JULY 31, 1995 (UNAUDITED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS- 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 3.5%
NR BBB- $ 500 Puerto Rico Industrial, Tourist,
Educational, Medical and
Environmental Control
Authority, Polytechnic
University, 6.50%,
8/1/24 $ 499,995
----------
GENERAL OBLIGATIONS - 19.2%
Aa AA $ 140 State of Hawaii, 5.75%,
1/1/11 $ 140,133
Aa AA 1,000 State of Hawaii, 5.25%,
6/1/13 936,140
Aa AA 750 City and County of
Honolulu, 4.75%,
9/1/17 645,098
Baa1 A 100 Commonwealth of Puerto
Rico Public Improvement,
5.25%, 7/1/18 90,490
NR BBB 340 Government of Guam,
5.375%, 11/15/13 299,390
Baa1 A 500 Puerto Rico Public Buildings
Authority, Public Education
and Health Facilities, 5.50%,
7/1/21 458,120
Baa1 A 100 Commonwealth of Puerto Rico
Aqueduct and Sewer Authority,
7.00%, 7/1/19 106,130
NR NR 100 Virgin Islands Public
Finance Authority, 7.25%,
10/1/18 103,155
----------
$2,778,656
HOSPITALS - 6.9% ----------
Aa2 AA $ 400 State of Hawaii Depart-
ment of Budget and
Finance, Kaiser Permanente,
6.25%, 3/1/21 $ 397,448
A A 625 State of Hawaii Department
of Budget and Finance
Kapiolani Health System,
6.00%, 7/1/19 601,200
----------
HOUSING - 7.9% $ 998,648
----------
Aa A $1,000 State of Hawaii Housing
Finance and Development
SFMB, 5.90%,
7/1/27 (2) $ 941,300
Aa A 215 State of Hawaii Housing
Finance and Development
SFMB, 6.00%, 7/1/26 200,735
----------
$1,142,035
----------
INDUSTRIAL DEVELOPMENT/
POLLUTION CONTROL - 7.1%
Aaa NR $ 550 Puerto Rico Industrial, Tourist,
Educational, Medical and
Environmental Control
Authority, Upjohn Company
Project, 7.50%, 12/1/23 $ 601,161
Aa3 AA- 400 Puerto Rico Industrial, Tourist,
Educational, Medical and
Environmental Control
Authority, Motorola Inc.
Project, 6.75%, 1/1/14 423,296
----------
$1,024,457
----------
INSURED EDUCATION - 3.4%
Aaa AAA $ 500 University of Hawaii Board
of Regents, University
System, (AMBAC), 5.65%,
10/1/12 $ 495,620
----------
</TABLE>
18
<PAGE> 9
HAWAII TAX FREE PORTFOLIO
PORTFOLIO OF INVESTMENTS - JULY 31, 1995 (UNAUDITED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS- 100%
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED GENERAL
OBLIGATION - 13.5%
Aaa AAA $700 County of Hawaii,
(FGIC), 5.55%, 5/1/10 $ 707,672
Aaa AAA 305 County of Kauai,
(MBIA), 5.90%, 2/1/14 311,457
Aaa AAA 250 County of Maui,
(FGIC), 5.75%, 1/1/13 252,385
Aaa AAA 250 County of Maui,
(FGIC), 5.125%,
12/15/13 238,117
Aaa AAA 500 Commonwealth of Puerto
Rico, (MBIA), 5.00%,
7/1/21 446,680
-----------
$ 1,956,311
-----------
INSURED HOSPITALS - 1.4%
Aaa AAA $100 State of Hawaii Department
of Budget and Finance Queen's
Medical Center, (FGIC),
6.50%, 7/1/12 $ 103,110
Aaa AAA 100 State of Hawaii Department
of Budget and Finance,
St. Francis Medical Centers,
(CGIC), 6.50%, 7/1/22 103,894
-----------
$ 207,004
-----------
INSURED HOUSING - 3.7%
Aaa AAA $500 Honolulu Hawaii City &
County Mortgage Revenue
Bonds, Smith Beretania
Project, (MBIA), 7.80%,
7/1/24 $ 537,185
-----------
INSURED TRANSPORTATION - 13.0%
Aaa AAA $500 State of Hawaii Airports
System, (FGIC), 7.50%,
7/1/20 $ 556,325
Aaa AAA 100 State of Hawaii Airports
System, (MBIA), 6.90%,
7/1/12 111,977
Aaa AAA 245 State of Hawaii Airports
System, (MBIA), 7.00%,
7/1/18 268,432
Aaa AAA 250 State of Hawaii Harbor
Revenue, (MBIA), 7.00%,
7/1/17 272,243
Aaa AAA 650 State of Hawaii Harbor
Revenue, (FGIC), 6.375%,
7/1/24 670,313
-----------
$ 1,879,290
-----------
INSURED UTILITY - 4.3%
Aaa AAA $500 State of Hawaii Department
of Budget and Finance
Hawaiian Electric Company,
Inc., (MBIA), 6.60%,
1/1/25 $ 518,240
Aaa AAA 100 Puerto Rico Electric
Power Authority "Stripes",
Variable, 7/1/03 (1) 109,497
-----------
$ 627,737
-----------
TRANSPORTATION - 16.1%
NR BBB $200 Guam Airport Authority,
6.70%, 10/1/23 $ 199,974
Aa AA 700 STATE OF HAWAII HIGHWAY
REVENUE, 5.00%, 7/1/11 638,890
Aa AA 800 State of Hawaii Highway
Revenue, 5.00%, 7/1/12 727,552
Baa1 A 500 Commonwealth of Puerto
Rico Highway and Trans-
portation Authority, 5.00%,
7/1/22 422,485
Baa1 A 200 Commonwealth of Puerto
Rico Highway and Trans-
portation Authority, 6.625%,
7/1/18 206,982
Baa3 BB+ 130 Puerto Rico Port Authority,
American Airlines, 6.30%,
6/1/23 126,170
-----------
$ 2,322,053
-----------
TOTAL TAX-EXEMPT INVESTMENTS -----------
(IDENTIFIED COST $13,821,873) $14,468,991
===========
</TABLE>
19
<PAGE> 10
HAWAII TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
RATINGS (UNAUDITED) PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- --------------------------------------------------------------------------------
(1) The above designated securities have been issued as inverse floater bonds.
(2) Security has been segregated to cover margin requirements on open financial
futures contracts.
The portfolio invests primarily in debt securities issued by Hawaii
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 39.3% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guarenty assurance agencies. The aggregate percentage by financial
institution ranged from 0.7% to 17.5% of total investments.
See notes to financial statements
20
<PAGE> 11
TAX FREE PORTFOLIOS
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
July 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FLORIDA INSURED HAWAII KANSAS
PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ----------- ----------
<S> <C> <C> <C>
INVESTMENT INCOME:
Investments -
Identified cost $15,731,571 $13,821,873 $9,309,873
Unrealized appreciation 896,025 647,118 243,876
----------- ----------- ----------
Total investments, at value (Note 1A) $16,627,596 $14,468,991 $9,553,749
Cash 321,485 353,648 89,699
Receivable for investments sold - 101,345 -
Receivable from the Investment Adviser (Note 2) 21,272 17,081 17,249
Interest receivable 266,451 144,690 180,547
Deferred organization expenses (Note 1D) 8,700 7,957 7,864
----------- ----------- ----------
Total assets $17,245,504 $15,093,712 $9,849,108
----------- ----------- ----------
LIABILITIES:
Payable for daily variation margin on open financial
futures contracts (Note 1E) $ - $ 2,656 $ 2,656
Payable to affiliates -
Trustee fees 14 14 14
Custodian fees - 214 -
Accrued expenses 1,081 1,011 1,176
----------- ----------- ----------
Total liabilities $ 1,095 $ 3,895 $ 3,846
----------- ----------- ----------
NET ASSETS APPLICABLE TO INVESTORS' INTEREST IN PORTFOLIO $17,244,409 $15,089,817 $9,845,262
=========== =========== ==========
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and withdrawals $16,348,384 $14,440,887 $9,597,542
Unrealized appreciation of investments and financial
futures contracts (computed on the basis of identified cost) 896,025 648,930 247,720
----------- ----------- ----------
Total $17,244,409 $15,089,817 $9,845,262
=========== =========== ==========
</TABLE>
See notes to financial statements
24
<PAGE> 12
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Six Months Ended July 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FLORIDA INSURED HAWAII KANSAS
PORTFOLIO PORTFOLIO PORTFOLIO
--------------- --------- ---------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income $ 475,072 $ 436,921 $ 281,753
--------- --------- ---------
Expenses -
Investment adviser fee (Note 2) $ 12,606 $ 11,460 $ 7,447
Compensation of Trustees not members of the
Investment Adviser's organization 83 83 83
Custodian fees (Note 2) - 382 -
Legal and accounting services 16,033 14,333 14,654
Interest expense (Note 5) 2,571 35 236
Bond pricing 1,481 1,024 1,281
Amortization of organization expenses (Note 1D) 1,202 1,099 1,092
Registration costs 125 125 125
--------- --------- ---------
Total expenses $ 34,101 $ 28,541 $ 24,918
--------- --------- ---------
Deduct -
Preliminary reduction of investment adviser fee (Note 2) $ 12,606 $ 11,460 $ 7,447
Preliminary allocation of expenses to the Investment Adviser (Note 2) 21,272 17,081 17,249
--------- --------- ---------
Total $ 33,878 $ 28,541 $ 24,696
--------- --------- ---------
Net expenses $ 223 $ - $ 222
--------- --------- ---------
Net investment income $ 474,849 $ 436,921 $ 281,531
--------- --------- ---------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) -
Investment transactions (identified cost basis) $ 10,440 $ (4,729) $ 14,971
Financial futures contracts (342,335) (219,818) (103,006)
Net realized loss on investments $(331,895) $(224,547) $ (88,035)
Change in unrealized appreciation (depreciation) -
Investments $ 667,784 $ 751,745 $ 353,991
Financial futures contracts - 17,163 11,457
--------- --------- ---------
Net unrealized appreciation of investments $ 667,784 $ 768,908 $ 365,448
--------- --------- ---------
Net realized and unrealized gain $ 335,889 $ 544,361 $ 277,413
--------- --------- ---------
Net increase in net assets from operations $ 810,738 $ 981,282 $ 558,944
========= ========= =========
</TABLE>
See notes to financial statements
25
<PAGE> 13
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the Six Months Ended July 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FLORIDA INSURED HAWAII KANSAS
PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ----------- ---------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 474,849 $ 436,921 $ 281,531
Net realized loss on investment transactions (331,895) (224,547) (88,035)
Change in unrealized appreciation of investments 667,784 768,908 365,448
----------- ----------- ----------
Net increase in net assets from operations $ 810,738 $ 981,282 $ 558,944
----------- ----------- ----------
Capital transactions -
Contributions $ 3,524,863 $ 2,195,918 $1,498,646
Withdrawals (1,491,143) (951,922) (518,356)
----------- ----------- ----------
Increase in net assets resulting from capital transactions $ 2,033,720 $ 1,243,996 $ 980,290
----------- ----------- ----------
Total increase in net assets $ 2,844,458 $ 2,225,278 $1,539,234
NET ASSETS:
At beginning of period 14,399,951 12,864,539 8,306,028
----------- ----------- ----------
At end of period $17,244,409 $15,089,817 $9,845,262
=========== =========== ==========
</TABLE>
- --------------------------------------------------------------------------------
For the period from the start of business, March 2, 1994, to January 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FLORIDA INSURED HAWAII KANSAS
PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ----------- -----------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 307,971 $ 497,012 $ 275,220
Net realized loss on investment transactions (57,512) (507,442) (22,782)
Unrealized appreciation (depreciation) of investments 228,241 (119,978) (117,728)
----------- ----------- ----------
Net increase (decrease) in net assets from operations $ 478,700 $ (130,408) $ 134,710
----------- ----------- ----------
Capital transactions -
Contributions $16,016,246 $13,464,081 $ 9,002,789
Withdrawals (2,195,015) (569,154) (931,491)
----------- ----------- ----------
Increase in net assets resulting from capital transactions $13,821,231 $12,894,927 $ 8,071,298
----------- ----------- ----------
Total increase in net assets $14,299,931 $12,764,519 $ 8,206,008
NET ASSETS:
At beginning of period 100,020 100,020 100,020
----------- ----------- ----------
At end of period $14,399,951 $12,864,539 $ 8,306,028
=========== =========== ==========
</TABLE>
See notes to financial statements
26
<PAGE> 14
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FLORIDA INSURED PORTFOLIO HAWAII PORTFOLIO
------------------------- --------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
JULY 31, ENDED JULY 31, ENDED
1995 JANUARY 31, 1995 JANUARY 31,
(UNAUDITED) 1995* (UNAUDITED) 1995*
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
RATIOS (As a percentage of average daily net assets)**:
Net expenses 0.00%+ 0.01%+ 0.00%+ 0.06%+
Net investment income 6.03%+ 5.73%+ 6.16%+ 6.03%+
PORTFOLIO TURNOVER 14% 33% 8% 66%
NET ASSETS, end of period (000 omitted) $17,244 $14,400 $15,090 $12,865
</TABLE>
<TABLE>
<CAPTION>
KANSAS PORTFOLIO
---------------------------
SIX MONTHS
ENDED YEAR
JULY 31, ENDED
1995 JANUARY 31,
(UNAUDITED) 1995*
----------- -----------
<S> <C> <C>
RATIOS (As a percentage of average daily net assets)**:
Net expenses 0.00%+ 0.01%+
Net investment income 6.07%+ 5.68%+
PORTFOLIO TURNOVER 7% 12%
NET ASSETS, end of period (000 omitted) $ 9,845 $ 8,306
</TABLE>
**The operating expenses of the Portfolios may reflect a reduction of the
investment adviser fee and/or allocation of expenses to the Investment
Adviser. Had such actions not been taken, the ratios would have been as
follows:
RATIOS (As a percentage of average daily net assets):
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Expenses 0.43%+ 0.41%+ 0.40%+ 0.38%+ 0.54%+ 0.43%+
Net investment income 5.60%+ 5.33%+ 5.76%+ 5.70%+ 5.53%+ 5.26%+
</TABLE>
+ Annualized.
* For the period from the start of business, March 2, 1994, to January 31, 1995.
See notes to financial statements
27
<PAGE> 15
Notes to Financial Statements
(Unaudited)
(1) SIGNIFICANT ACCOUNTING POLICIES
Florida Insured Tax Free Portfolio ("Florida Insured Portfolio"), Hawaii Tax
Free Portfolio ("Hawaii Portfolio") and Kansas Tax Free Portfolio ("Kansas
Portfolio"), collectively the Portfolios, are registered under the Investment
Company Act of 1940 as non-diversified open-end management investment companies
which were organized as trusts under the laws of the State of New York on May 1,
1992 for the Hawaii Portfolio and October 25, 1993 for the Florida Insured
Portfolio and Kansas Portfolio. The Declarations of Trust permit the Trustees to
issue interests in the Portfolios. The following is a summary of significant
accounting policies of the Portfolios. The policies are in conformity with
generally accepted accounting principles.
A. INVESTMENT VALUATIONS - Municipal bonds are normally valued on the basis of
valuations furnished by a pricing service. Taxable obligations, if any, for
which price quotations are readily available are normally valued at the mean
between the latest bid and asked prices. Futures contracts listed on commodity
exchanges are valued at closing settlement prices. Short-term obligations,
maturing in sixty days or less, are valued at amortized cost, which approximates
value. Investments for which valuations or market quotations are unavailable are
valued at fair value using methods determined in good faith by or at the
direction of the Trustees.
B. INCOME - INTEREST INCOME is determined on the basis of interest accrued,
adjusted for amortization of premium or discount when required for federal
income tax purposes.
C. INCOME TAXES - The Portfolios are treated as partnerships for Federal tax
purposes. No provision is made by the Portfolios for federal or state taxes on
any taxable income of the Portfolios because each investor in the Portfolios is
ultimately responsible for the payment of any taxes. Since some of the
Portfolios' investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolios, the Portfolios normally
must satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for their respective investors to
satisfy them. The Portfolios will allocate at least annually among their
respective investors each investor's distributive share of the Portfolios' net
taxable (if any) and tax-exempt investment income, net realized capital gains,
and any other items of income, gain, loss, deductions or credit. Interest income
received by the Portfolios on investments in municipal bonds, which is
excludable from gross income under the Internal Revenue Code, will retain its
status as income exempt from federal income tax when allocated to each
Portfolio's investors. The portion of such interest, if any, earned on private
activity bonds issued after August 7, 1986, may be considered a tax preference
item for investors.
D. DEFERRED ORGANIZATION EXPENSES - Costs incurred by a Portfolio in connection
with its organization are being amortized on the straight-line basis over five
years.
E. FINANCIAL FUTURES CONTRACTS - Upon the entering of a financial futures
contract, a Portfolio is required to deposit ("initial margin") either in cash
or securities an amount equal to a certain percentage of the purchase price
indicated in the financial futures contract. Subsequent payments are made or
received by a Portfolio ("margin maintenance") each day, dependent on the daily
fluctuations in the value of the underlying security, and are recorded for book
purposes as unrealized gains or losses by a Portfolio. A Portfolio's investment
in financial futures contracts is designed only to hedge against anticipated
future changes in interest rates. Should interest rates move unexpectedly, a
Portfolio may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss.
F. OTHER - Investment transactions are accounted for on a trade date basis.
G. INTERIM FINANCIAL INFORMATION - The interim financial statements relating to
July 31, 1995 and for the six month period then ended have not been audited by
independent certified public accountants, but in the opinion of each Portfolio's
management, reflect all adjustments, consisting only of normal recurring
adjustments necessary for the fair presentation of the financial statements.
28
<PAGE> 16
(2) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee is earned by Boston Management and Research (BMR), a
wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to each Portfolio. The fee
is based upon a percentage of average daily net assets plus a percentage of
gross income (i.e., income other than gains from the sale of securities). For
the six month period ended July 31, 1995, the fee for the Florida Insured
Portfolio, Hawaii Portfolio and Kansas Portfolio was equivalent to 0.16%, 0.16%
and 0.16% (annualized), respectively, of each Portfolio's average net assets for
such period and amounted to $12,606, $11,460 and $7,447, respectively. To
enhance the net income of the Florida Insured Portfolio, Hawaii Portfolio and
Kansas Portfolio, BMR made a preliminary reduction of its fee in the amount of
$12,606, $11,460 and $7,447, respectively, and $21,272, $17,081 and $17,249,
respectively, of expenses related to the operation of the Portfolios were
allocated, on a preliminary basis, to BMR. Except as to Trustees of the
Portfolios who are not members of EVM's or BMR's organization, officers and
Trustees receive remuneration for their services to the Portfolios out of such
investment adviser fee. Investors Bank & Trust Company (IB&T), an affiliate of
EVM and BMR, serves as custodian of the Portfolios. Pursuant to the respective
custodian agreements, IB&T receives a fee reduced by credits which are
determined based on the average daily cash balances each Portfolio maintains
with IB&T. Certain of the officers and Trustees of the Portfolios are officers
and directors/trustees of the above organizations. Trustees of the Portfolios
that are not affiliated with the Investment Adviser may elect to defer receipt
of all or a percentage of their annual fees in accordance with the terms of the
Trustees Deferred Compensation Plan. For the six months ended July 31, 1995, no
significant amounts have been deferred.
- --------------------------------------------------------------------------------
(3) INVESTMENTS
Purchases and sales of investments, other than U.S. Government securities and
short-term obligations, for the six months ended July 31, 1995, were as follows:
<TABLE>
<CAPTION>
FLORIDA INSURED PORTFOLIO HAWAII PORTFOLIO KANSAS PORTFOLIO
------------------------- ---------------- ----------------
<S> <C> <C> <C>
Purchases $3,867,422 $2,261,966 $1,551,089
Sales 2,105,500 1,155,365 641,409
</TABLE>
(4) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investments
owned by each Portfolio at July 31, 1995, as computed on a federal income tax
basis, are as follows:
<TABLE>
<CAPTION>
FLORIDA INSURED PORTFOLIO HAWAII PORTFOLIO KANSAS PORTFOLIO
------------------------- ---------------- ----------------
<S> <C> <C> <C>
Aggregate Cost $ 15,731,571 $ 13,821,873 $ 9,309,873
============ ============= ===========
Gross unrealized appreciation $ 935,785 $ 697,192 $ 264,205
Gross unrealized depreciation 39,760 50,074 20,329
------------ ------------- -----------
Net unrealized appreciation $ 896,025 $ 647,118 $ 243,876
============ ============= ===========
</TABLE>
- --------------------------------------------------------------------------------
(5) LINE OF CREDIT
The Portfolios participate with other portfolios and funds managed by BMR and
EVM in a $120 million unsecured line of credit agreement with a bank. The line
of credit consists of a $20 million committed facility and a $100 million
discretionary facility. Each Portfolio may temporarily borrow up to 5% of its
total assets to satisfy redemption requests or settle securities transaction.
Interest is charged to each portfolio or fund based on its borrowings at an
amount above either the bank's adjusted certificate of deposit rate, a variable
adjusted certificate of deposit rate, or a federal funds effective rate. In
addition, a fee computed at an annual rate of 1/4 of 1% on the $20 million
committed facility and on the daily unused portion of the $100 million
discretionary facility is allocated among the participating funds and portfolios
at the end of each quarter. The Hawaii Portfolio and the Kansas Portfolio did
not have any significant borrowings or allocated fees during the period. For the
six months ended July 31, 1995, the average daily loan balance outstanding
pursuant to this line of credit for the Florida Insured Portfolio was $315,250
and the average interest rate was 7.54%. The maximum borrowing outstanding
during the six months ended July 31, 1995 was $819,000.
29
<PAGE> 17
(6) FINANCIAL INSTRUMENTS
The Portfolios regularly trade in financial instruments with off-balance sheet
risk in the normal course of their investing activities to assist in managing
exposure to various market risks. These financial instruments include written
options and futures contracts and may involve, to a varying degree, elements of
risk in excess of the amounts recognized for financial statement purposes.
The notional or contractual amounts of these instruments represent the
investment a Portfolio has in particular classes of financial instruments and
does not necessarily represent the amounts potentially subject to risk. The
measurement of the risks associated with these instruments is meaningful only
when all related and offsetting transactions are considered.
A summary of obligations under these financial instruments at July 31, 1995 is
as follows:
<TABLE>
<CAPTION>
FUTURES
CONTRACTS NET UNREALIZED
PORTFOLIO EXPIRATION DATE CONTRACTS POSITION APPRECIATION
- --------- --------------- --------- -------- ------------
<S> <C> <C> <C> <C>
Florida Insured - - - -
Hawaii 9/95 5 U.S. Treasury Short $1,812
======
Kansas 9/95 5 U.S. Treasury Short $3,844
======
</TABLE>
At July 31, 1995, the Hawaii Portfolio and Kansas Portfolio had sufficient cash
and/or securities segregated to cover margin requirements on open futures
contracts. The Florida Insured Portfolio did not have any open financial futures
contracts at July 31, 1995.
30
<PAGE> 18
Investment Management
- -----------------------------------------------------------------------------
FUNDS OFFICERS INDEPENDENT TRUSTEES
THOMAS J. FETTER DONALD R. DWIGHT
President President, Dwight Partners, Inc.
Chairman, Newspaper of New England, Inc.
JAMES B. HAWKES
Vice President, Trustee SAMUEL L. HAYES, III
Jacob H. Schiff Professor of Investment
ROBERT B. MACINTOSH Banking, Harvard University Graduate
Vice President School of Business Administration
JAMES L. O'CONNOR NORTON H. REAMER
Treasurer President and Director, United Asset
Management Corporation
THOMAS OTIS
Secretary JOHN L. THORNDIKE
Director, Fiduciary Company Incorporated
JACK L. TREYNOR
Investment Adviser and Consultant
- -----------------------------------------------------------------------------
PORTFOLIOS OFFICERS INDEPENDENT TRUSTEES
THOMAS J. FETTER DONALD R. DWIGHT
President and Portfolio President, Dwight Partners, Inc.
Manager of Florida Chairman, Newspaper of New England, Inc.
Insured Tax Free Portfolio
SAMUEL L. HAYES, III
JAMES B. HAWKES Jacob H. Schiff Professor of Investment
Vice President, Trustee Banking, Harvard University Graduate
School of Business Administration
ROBERT B. MACINTOSH
Vice President and NORTON H. REAMER
Florida Insured, Hawaii President and Director, United Asset
and Kansas Tax Free Management Corporation
Portfolios
Portfolio Manager of JOHN L. THORNDIKE
Hawaii Tax Free Director, Fiduciary Company Incorporated
Portfolio
JACK L. TREYNOR
NICOLE ANDERES Investment Adviser and Consultant
Vice President and
Portfolio Manager of
Kansas Tax Free Portfolio
JAMES L. O'CONNOR
Treasurer
THOMAS OTIS
Secretary
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