<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
Semi-Annual Report
June 30, 1998
California Tax-Free Income Fund
Core Fixed Income Fund
Core Growth Fund
Fixed Income Fund
High Yield Fixed Income Fund
Intermediate Duration Fixed Income Fund
Investment Grade Fixed Income Fund
LOOMIS SAYLES
INVESTMENT TRUST
A Family of Institutional Mutual Funds
One Financial Center o Boston, Massachusetts 02111
617-482-2450
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
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[Photo of Daniel J. Fuss]
DANIEL J. FUSS
President
Dear Shareholders:
Federal Reserve Board Chairman Alan Greenspan, recently remarked before Congress
that he had been in the economic forecasting business for over fifty years and
felt he could forecast reasonably well, but "this is a tough one". I'm sure
Chairman Greenspan would be happy to know that I agree with him. This is a tough
one. Many are able to discern the obvious economic guideposts and extrapolate
what might happen in the markets. Of course, the trouble with forecasting is
none of us know what may lurk around the corner.
My letter to you of last year spoke about many of the same issues we face
today. So much has happened in the intervening year, and yet it is remarkable
how little has changed.
Fortunately, the world is still at peace and that's particularly good for
worldwide financial markets. However, the Indian and Pakistani nuclear testing
has jarred complacency about peace and the political instability in Indonesia
is also very unsettling.
There is abundant liquidity in the markets, which has recently become more
unevenly distributed. Currently, there's a lot of money in what are perceived
to be "safe" investments - U.S. Treasuries and the familiar names of large
capitalization stocks, while more risky areas have much less. Liquidity in the
system always invites mischief. Savvy money managers, looking for quick money,
are shorting thinly traded currencies of countries with weak economies. This
increases the risk to those countries and has hampered their attempts at
economic recovery in the longer term.
On the home front, the U.S. economy remains strong. But without clear signs of
resurgent inflation or serious economic repercussions from the Asian crisis,
the Federal Reserve seems reluctant to take significant monetary policy
actions. Valuation levels on equities seem high, particularly as earnings
growth is likely to slow. Large cap stocks have had a good run in this bull
market, but the margin for error is higher now. This puts a premium on paying
close attention to your investments and remaining well diversified.
Diversifying into fixed income assets could be a prudent move for many.
Markets go up and markets go down. That is their nature. It's always been
tough to say just when. We can see the signs and evaluate the risks, but it's
hard to know just when to expect the unexpected.
Thanks for investing with us.
Sincerely,
/S/ Daniel J. Fuss
Daniel J. Fuss
<PAGE>
LOOMIS SAYLES CALIFORNIA
TAX-FREE INCOME FUND
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During the quarter we continued to consolidate and lengthen the portfolio by
selling bonds with calls in 1999 and 2000 and purchasing bonds with calls in
2002 and 2003. Lengthening modestly in callable bonds should help us maintain
our current income and provide appreciation potential as interest rates move
lower over the next year.
The municipal market underperformed the US Treasury market as interest rates
moved lower. This was caused by a large calendar of new municipal issues, and
a reduction in Treasury offerings due to the budget surplus.
During the first half of 1998, the municipal bond market experienced extremely
high volume of $146.4 billion representing the third largest six month period
in municipal history. From a volume perspective, the first half of 1993 when
yields plummeted and refunding skyrocketed, and the second half of 1985 as
issuers rushed in to evade proposed limitations under tax reform were the only
instances to date with greater volume. Refunding volume was up 118% which
should begin to taper off as refunding candidates dissipate.
Health care, transportation (highway and airports) and particularly electric
power were the largest issuing sectors this half.
Once the heavy volume prevalent in today's municipal market retreats, we
expect that tax-exempts should begin to outperform the Treasury market. We are
focusing on when this could take place, and are less concerned with whether it
will occur.
The California Tax-Free Income Fund was ahead 1.16% for the second quarter
versus a return of 1.10% for the Lipper California Intermediate Municipal Bond
Fund Index. The Fund was ahead 2.33% year to date versus 1.97% for the same
Index.
Robert K. Payne is the portfolio manager for the California Tax-Free
Income Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
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Average Returns (%) - Period Ended June 30, 1998
Annualized
-------------------
Since
Year to date 1 year 3 years Inception
Loomis Sayles California
Tax-Free Income Fund 2.3 6.9 6.5 6.1
Lipper California Intermediate
Municipal Bond Fund Index(b) 2.0 6.7 6.5 6.0
Lehman Brothers Municipal Bond
Index(c) 2.7 8.7 7.9 7.3
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 6/1/95 10.00 10.00 10.00
Period Ended
6/30/95 09.93 09.92 09.91
9/30/95 10.19 10.20 10.20
12/31/95 10.49 10.49 10.62
3/31/96 10.47 10.43 10.49
6/30/96 10.52 10.48 10.57
9/30/96 10.69 10.67 10.81
12/31/96 10.93 10.89 11.09
3/31/97 10.92 10.88 11.06
6/30/97 11.22 11.18 11.45
9/30/97 11.49 11.48 11.79
12/31/97 11.69 11.71 12.11
3/31/98 11.83 11.82 12.25
6/30/98 11.99 11.95 12.44
Cumulative Performance Registration(a) to June 30, 1998
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Average Returns (%) - Period Ended June 30, 1998
Annualized
---------
Since
Year to date 1 year Registration
Loomis Sayles California
Tax-Free Income Fund 2.3 6.9 6.9
Lipper California Intermediate
Municipal Bond Fund Index(b) 2.0 6.7 7.6
Lehman Brothers Municipal Bond
Index(c) 2.7 8.7 9.8
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.94 10.00 10.00
6/30/97 10.21 10.28 10.35
9/30/97 10.47 10.53 10.66
12/31/97 10.67 10.73 10.95
3/31/98 10.80 10.82 11.07
6/30/98 10.92 10.94 11.24
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles California Tax-Free Income Fund is June
1, 1995. Shares of the Fund were registered for offer and sale under the
Securities Act of 1933 on March 7, 1997. In accordance with SEC
regulations, performance information is provided for the period beginning
on March 7, 1997 ("Registration"). For the convenience of our long-term
shareholders, performance information is also provided for the period
beginning on June 1, 1995 ("Inception"). Since Lipper California
Intermediate Municipal Bond Fund Index & Lehman Brothers Municipal Bond
Index performance data is not available coincident with the registration
date, comparative performance is presented from March 31, 1997.
(b): Source: Lipper Analytical Services.
(c): Lehman Brothers Municipal Bond Index is computed from prices on
approximately 21,000 bonds consisting of roughly 30% revenue bonds, 30%
government obligation bonds, 27% insured and 13% prerefunded bonds. The
index returns have not been reduced for management and operating expenses
applicable to mutual fund investments. Source: Lehman Brothers.
<PAGE>
LOOMIS SAYLES CORE FIXED INCOME FUND
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The combination of low inflation and a greater appetite for U.S. debt
securities led to stronger returns for bond market investors in the second
quarter. The bond market, as measured by the Merrill Lynch Corporate/
Government Bond Index, rose 2.6% during the quarter. Recall that the bond
market had only a mediocre 1.6% return in the first quarter. As such, the bond
market is on pace to provide a 7.5 - 8.0% total return in 1998.
In the second quarter, bond returns were supported by a decline in interest
rates which particularly bolstered the return on longer maturing securities.
The Core Fixed Income Fund participated in the rally due to our duration being
slightly longer than the Merrill Lynch Index. The yield on the benchmark 30
Year U.S. Treasury security dropped to 5.6% rivaling its all-time low set back
in October 1993. The continued favorable news of low inflation, currently
1.5%, combined with the likelihood that the Federal Reserve will remain
neutral on interest rates, paved the way for these lower yields. Indeed,
inflation rates remain very low, especially for a business cycle which is in
its eighth year of expansion.
While the general bond market was helped by lower interest rates, corporate
bonds had somewhat weaker returns, particularly in the month of June.
Specifically, corporate bond returns were nearly as weak as in October 1997
and January 1998. Lagging performance was primarily attributable to
resurfacing concerns in Asia and the fear of weaker second quarter earnings
reports for U.S. companies. Fortunately, while U.S. earnings growth has been
decelerating for the last three years, growth rates are currently in positive
territory. Corporate earnings have continued to exceed Wall Street consensus
estimates through the early announcements of second quarter results. That
appears to bode well for corporate bond holders in the near term as well as
strengthening the long term case for a meaningful allocation to corporate
bonds in fixed income portfolios. As a result, the Core Fixed Income Fund
remains positioned with a higher concentration of corporate securities.
The Core Fixed Income Fund returned 2.5% for the quarter and 3.8% year-to-date
versus the Merrill Lynch Corporate/Government Bond Index of 2.6% and 4.2%,
respectively. For the last twelve months, the Fund is up 10.5% versus 11.3%
for the Merrill Lynch Corporate/Government Bond Index.
William F. Camp is the portfolio manager for the Core Fixed Income Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
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Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Inception
Loomis Sayles Core Fixed
Income Fund 3.8 10.5 8.4
Lipper Corp. A Rated Bond
Fund Index(b) 3.9 10.7 9.2
Merrill Lynch Corporate/
Government Bond Index(c) 4.2 11.3 9.3
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Merrill
As of 4/24/96 10.00 10.00 10.00
Period Ended
6/30/96 10.06 10.02 10.04
9/30/96 10.21 10.20 10.21
12/31/96 10.53 10.53 10.53
3/31/97 10.44 10.44 10.45
6/30/97 10.80 10.82 10.82
9/30/97 11.16 11.27 11.26
12/31/97 11.50 11.59 11.61
3/31/98 11.64 11.76 11.80
6/30/98 11.93 12.04 12.11
Cumulative Performance Registration(a) to June 30, 1998
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Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Registration
Loomis Sayles Core Fixed
Income Fund 3.8 10.5 9.9
Lipper Corp. A Rated Bond
Fund Index(b) 3.9 10.7 11.7
Merrill Lynch Corporate/
Government Bond Index(c) 4.2 11.3 12.1
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Merrill
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.90 10.00 10.00
6/30/97 10.25 10.37 10.36
9/30/97 10.59 10.74 10.72
12/31/97 10.91 11.04 11.07
3/31/98 11.04 11.20 11.24
6/30/98 11.32 11.47 11.53
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles Core Fixed Income Fund is April 24,
1996. Shares of the Fund were registered for offer and sale under the
Securities Act of 1933 on March 7, 1997. In accordance with SEC
regulations, performance information is provided for the period beginning
on March 7, 1997 ("Registration"). For the convenience of our long-term
shareholders, performance information is also provided for the period
beginning on April 24, 1996 ("Inception"). Since Lipper Corporate A Rated
Bond Fund Index & Merrill Lynch Corporate/Government Bond Index performance
data is not available coincident with the inception and registration dates,
comparative performance is presented from April 30, 1996 and March 31,
1997, respectively.
(b): Source: Lipper Analytical Services.
(c): The Merrill Lynch Corporate/Government Bond Index is composed of all bonds
that are investment grade (rated Baa or higher by Moody's or BBB or higher
by S&P, if unrated by Moody's). Issues must have at least one year to
maturity. Total return comprises price appreciation/depreciation and income
as a percentage of the original investment. Indices are rebalanced monthly
by market capitalization. Source: Merrill Lynch.
<PAGE>
LOOMIS SAYLES CORE GROWTH FUND
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Transactions continued at a moderate pace during the second quarter, and were
more characterized by shifts within sectors than any change in sector
emphasis. Most notable in this respect was the taking of a large gain in
BankBoston and the redeployment of the funds in Wells Fargo which is merging
with Norwest. This gave us a more purely domestic exposure with substantial
potential for cost savings and better revenue growth as Norwest's more
aggressive management takes over Wells Fargo. Also worth a comment is the sale
and quick repurchase of Chrysler. The sale was prompted by escalating price
competition in the auto industry which led us to take our profit. Two days
later the Daimler Benz acquisition of Chrysler was announced. Since Chrysler
was selling at a large discount to the acquisition price and we believed the
combination to be a very good one, we repurchased the stock. To date, it has
been a profitable decision.
On balance, we have an environment which appears at least moderately favorable
for corporate earnings. As long as the strong dollar keeps a lid on inflation
and foreigners continue to recycle their dollars into U.S. financial markets,
the bull market seems set to continue. However, the extreme valuations now
prevailing and the dependence on foreign funds flows continue to suggest
caution is in order.
The shortfall versus the S&P 500 is essentially accounted for by one stock -
Analog Devices. This issue declined 37% in May after reporting second quarter
results 12% above the prior year but 10% below consensus expectations. Other
weakness was in the energy sector and some consumer nondurable stocks. Average
capitalization size, while much larger than it historically has been, also
hurt, especially in the late June rally which was almost entirely concentrated
in large growth names. On the plus side a number of issues including Cisco,
Chrysler, American Express, Warner Lambert, and EMC delivered strong
performance in the quarter.
For the six month period ending June 30, 1998, the Core Growth Fund returned
17.1% underperforming the S&P 500 which returned 17.7%. The Fund outperformed
the Lipper Growth Fund Index which returned 15.6% for the same time period.
Quentin P. Faulkner is the portfolio manager for the Core Growth Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
- --------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Inception
Loomis Sayles Core Growth Fund 17.1 19.7 17.9
Lipper Growth Fund Index(b) 15.6 28.3 23.4
S&P 500 Index(c) 17.7 30.2 29.8
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[A line graph depicting the following plot points appears here.]
Loomis Lipper S&P
As of 10/1/95 10.00 10.00 10.00
Period Ended
12/31/95 10.04 10.24 10.60
3/31/96 10.21 10.70 11.17
6/30/96 10.53 11.06 11.67
9/30/96 10.82 11.37 12.03
12/31/96 11.61 12.03 13.04
3/31/97 11.88 11.99 13.39
6/30/97 13.14 13.89 15.72
9/30/97 13.04 15.55 16.90
12/31/97 13.43 15.41 17.39
3/31/98 15.39 17.32 19.81
6/30/98 15.72 17.81 20.47
Cumulative Performance Registration(a) to June 30, 1998
- --------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Registration
Loomis Sayles Core Growth Fund 17.1 19.7 19.7
Lipper Growth Fund Index(b) 15.6 28.3 37.2
S&P 500 Index(c) 17.7 30.2 40.4
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[A line graph depicting the following plot points appears here.]
Loomis Lipper S&P
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.58 10.00 10.00
6/30/97 10.59 11.58 11.75
9/30/97 11.27 12.77 12.63
12/31/97 10.82 12.85 12.99
3/31/98 12.40 14.44 14.80
6/30/98 12.67 14.85 15.29
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles Core Growth Fund is October 1, 1995.
Shares of the Fund were registered for offer and sale under the Securities
Act of 1933 on March 7, 1997. In accordance with SEC regulations,
performance information is provided for the period beginning on March 7,
1997 ("Registration"). For the convenience of our long-term shareholders,
performance information is also provided for the period beginning on
October 1, 1995 ("Inception"). Since Lipper Growth Fund Index & S&P 500
Index performance data is not available coincident with the registration
date, comparative performance is presented from March 31, 1997.
(b): Source: Lipper Analytical Services.
(c): S&P 500 Index is a capitalization-weighted, total return index comprised of
500 widely held common stocks, representing industrial, utility,
transportation, and financial companies traded on the New York Stock
Exchange, the American Stock Exchange and in the Over-the-Counter market.
The index returns have not been reduced for ongoing management and
operating expenses applicable to mutual fund investments.
<PAGE>
LOOMIS SAYLES FIXED INCOME FUND
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The Loomis Sayles Fixed Income Fund generated a 0.5% return for the second
quarter of 1998 well behind the Lehman Government/Corporate Index return of
2.6% for the period. This quarterly performance is due primarily to the Fund's
exposures to lower quality bonds and emerging market debt. Canadian Provincial
and Government debt posted modest gains, but still underperformed on a
relative basis as the US dollar continued to appreciate over the quarter. The
Fund maintained enough structural and issue diversity to maintain market-like
performance over the entire six month period.
Over the trailing twelve months the portfolio has returned 11.0% versus 11.3%
for the benchmark. This return is slightly better than the 10.5% average for
the Lipper BBB Rated Corporate Debt Funds for the period. Longer term returns
remain attractive on a relative basis.
The domestic economy continues to exhibit resilience during the second quarter
although there were signs that the deepening economic crisis in Asia was
beginning to have its effects felt in the U.S. The GM strike combined with
negative Asian effects seem to indicate the economy may be slowing. This fact,
pared with a continued strong dollar and low energy prices, continued to
contain domestic inflation. This environment set the stage for a robust rally
in U.S. Treasuries as yields fell out of their 5.80-6.00% trading range and
ended the quarter 5.63%. Long Treasuries were among the best performers while
lower credit quality bonds underperformed as the economy slowed and their
prices failed to keep pace with the Treasury rally. Most notably emerging
markets declined further as banking concerns throughout the region cast doubts
on a quick recovery for these markets. We continue to see long-term value in
these sectors.
Overall, however, the markets currently appear favorable for investors due to
low inflation, liquidity and peace. These attributes would need to be upset
for broad, deteriorating market conditions to develop.
The Fund's exposure to select high yield issues in emerging market countries,
representing approximately 12% of the Fund, has been volatile, performing well
in the first quarter but lagging more recently as political, economic and
social turmoil continued for the region. Domestic corporate issues, including
the high yield segment, trailed during the quality-driven Treasury rally which
marked the May-June period. The Fund's long Treasury positions performed well
in this environment partially offsetting the negative effects of the emerging
market positions. We have recently increased our exposure to the energy sector
to approximately 5.2%. We believe this sector has become vastly undervalued
due to temporary excess supply problems caused by weak demand from Asia and
the lingering effects of El Nino.
In summary, we believe that the Fixed Income Fund remains well positioned for
the current environment. The Fund maintains a very attractive yield advantage,
adequate call protection and upgrade potential. We are maintaining exposures
to domestic high yield and select emerging markets as we believe both segments
offer value at this junction. The Fund is diversified across 178 issues and
various bond market segments including the investment grade and non-investment
grade debt through foreign and domestic issuers. We remain confident of the
total return potential embedded in the portfolio.
Daniel J. Fuss is the portfolio manager for the Loomis Sayles Fixed Income
Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
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Average Returns (%) - Period Ended June 30, 1998
Annualized
-------------------
Since
Year to date 1 year 3 years Inception
Loomis Sayles Fixed Income Fund 4.1 11.0 12.7 15.6
Lipper BBB Bond Fund Index(b) 3.8 10.7 8.6 10.6
Lehman Brothers Gov't/Corp.
Bond Index(c) 4.2 11.3 7.9 9.83
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 1/17/95 10.00 10.00 10.00
Period Ended
3/31/95 10.50 10.31 10.30
6/30/95 11.55 11.03 10.97
9/30/95 12.10 11.30 11.18
12/31/95 12.74 11.83 11.70
3/31/96 12.56 11.59 11.43
6/30/96 12.72 11.63 11.48
9/30/96 13.27 11.89 11.68
12/31/96 13.98 12.31 12.04
3/31/97 14.06 12.22 11.94
6/30/97 14.87 12.72 12.37
9/30/97 15.70 13.08 12.80
12/31/97 15.86 13.41 13.21
3/31/98 16.43 13.64 13.41
6/30/98 16.51 13.92 13.76
Cumulative Performance Registration(a) to June 30, 1998
- ---------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Registration
Loomis Sayles Fixed Income Fund 4.1 11.0 12.2
Lipper BBB Rated Bond
Fund Index(b) 3.8 10.7 12.0
Lehman Brothers Gov't/Corp.
Bond Index(c) 4.2 11.3 12.1
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.91 10.00 10.00
6/30/97 10.48 10.41 10.36
9/30/97 11.06 10.80 10.73
12/31/97 11.17 11.07 11.07
3/31/98 11.57 11.27 11.24
6/30/98 11.63 11.5 11.53
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles Fixed Income Fund is January 17, 1995.
Shares of the Fund were registered for offer and sale under the Securities
Act of 1933 on March 7, 1997. In accordance with SEC regulations,
performance information is provided for the period beginning on March 7,
1997 ("Registration"). For the convenience of our long-term shareholders,
performance information is also provided for the period beginning on
January 17, 1995 ("Inception"). Since Lipper BBB Rated Bond Fund Index &
Lehman Brothers Government/ Corporate Bond Index performance data is not
available coincident with the inception and registration dates, comparative
performance is presented from January 31, 1995 and March 31, 1997,
respectively.
(b): Source: Lipper Analytical Services.
(c): Lehman Brothers Government/Corporate Bond Index is a composite of
approximately 5,300 corporate and government issues with at least $100
million outstanding for government issues and $25 million for corporates,
and greater than 1 year maturity. The index returns have not been lowered
for ongoing management and operating expenses applicable to mutual fund
investments. Source: Lehman Brothers.
<PAGE>
LOOMIS SAYLES HIGH YIELD FIXED INCOME FUND
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The High Yield Fixed Income Fund returned -5.2% for the quarter ending June
30, 1998. This return was measurably behind the 1.7% return of the Merrill
Lynch High Yield Master Index. Exposure to Latin America and the Pacific Rim
curtailed performance over the past three months as the capital flight from
Asia unwound leveraged positions causing spreads to widen and creating
liquidity problems in the region. Domestically high yield issues faired
better, but record new deal issuance and the "flight to quality" led lower
quality issues to underperform Treasuries and higher quality corporate bonds.
Convertible bonds were mixed in the second quarter, with technology and
international issues generally weaker as global equity markets gave back some
of their earlier gains.
The domestic economy continued to demonstrate its resilient ability to expand,
although weak demand from Asia is finally taking a visible toll on
manufacturing and profit margins. This kept the Fed on the sidelines during
the quarter despite labor markets and strong domestic consumption. Higher
quality corporate issues outperformed high yield issues as investor sentiment
became increasingly more cautious towards the high yield market amid further
deterioration in the Asian economic crisis and a record amount of new issuance
through the first six months of 1998. Asian and Latin American spreads
widened over the last three months as countries such as Japan, Korea and
Thailand have yet to establish a credible plan to reform their troubled
banking systems. Domestically, consumer cyclicals continued to benefit from
strong demand, productivity gains, and the historically high level of consumer
confidence. Defaults edged up slightly over the first half of the year,
however rates still remain quite low by historical standards. The 30 year
Treasury yield fell from 5.93% to 5.62% over the past three months
As of June 30, 1998, the High Yield Fixed Income Fund was well diversified
across 113 issues. The Fund currently has an average bond price of $68.56
which reflects the embedded potential for capital appreciation as well as a
significant call protection. Despite the recent setback in Asia we remain
committed to our exposure to emerging market Yankee bonds because of their
attractive current yields relative to domestic issues and the potential
compounded cash flows they will generate as long as their credit profile
stabilizes.
We continue to favor the Cable/Media and Telecommunications sectors based upon
the positive synergies we feel will be created for consumers by consolidating
wireless, local & long distance, cable and internet services. We have
increased our exposure to the energy sector. We believe this sector has become
vastly undervalued due to the temporary excess supply problems in the industry
caused by weak demand from Asia and the lingering effects of El Nino.
In summary, we believe that the High Yield Fixed Income Fund remains well
positioned for the current investment environment. The Fund maintains an
adequate amount of diversification and call protection to help insulate the
portfolio from interest rate fluctuations and reinvestment risk. We like the
overall structure of the portfolio and its potential for superior long-term
investment returns, consequently we intend to ride out the current market
volatility adding only to select bonds on an opportunistic basis.
Daniel J. Fuss is the portfolio manager for the Loomis Sayles High Yield Fixed
Income Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
- --------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Inception
Loomis Sayles High Yield
Fixed Income Fund 1.1 5.6 8.5
Lipper High Yield Bond
Fund Index(b) 4.8 12.1 13.4
Merrill Lynch High Yield
Master Index(c) 4.5 11.4 12.8
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[A line graph depicting the following plot points appears here.]
Loomis Lipper Merrill
As of 6/5/96 10.00 10.00 10.00
Period Ended
6/30/96 10.03 10.01 10.06
9/30/96 10.38 10.47 10.45
12/31/96 10.76 10.82 10.86
3/31/97 10.55 10.86 10.98
6/30/97 11.22 11.43 11.50
9/30/97 12.13 12.07 11.88
12/31/97 11.72 12.25 12.19
3/31/98 12.50 12.79 12.53
6/30/98 11.85 12.84 12.74
Cumulative Performance Registration(a) to June 30, 1998
- ----------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Registration
Loomis Sayles High Yield
Fixed Income Fund 1.1 5.6 8.1
Lipper High Yield Bond
Fund Index(b) 4.8 12.1 14.2
Merrill Lynch High Yield
Master Index(c) 4.5 11.4 13.1
- -------------------------------------------------------------------
[A line graph depicting the following plot points appears here.]
Loomis Lipper Merrill
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.87 10.00 10.00
6/30/97 10.49 10.52 10.48
9/30/97 11.35 11.08 10.89
12/31/97 10.96 11.25 11.17
3/31/98 11.69 11.74 11.48
6/30/98 11.08 11.79 11.67
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles High Yield Fixed Income Fund is June 5,
1996. Shares of the Fund were registered for offer and sale under the
Securities Act of 1933 on March 7, 1997. In accordance with SEC
regulations, performance information is provided for the period beginning
on March 7, 1997 ("Registration"). For the convenience of our long-term
shareholders, performance information is also provided for the period
beginning on June 5, 1996 ("Inception"). Since Lipper High Yield Bond Fund
Index & Merrill Lynch High Yield Master Index performance data is not
available coincident with the inception and registration dates, comparative
performance is presented from June 30, 1996 and March 31, 1997,
respectively.
(b): Source: Lipper Analytical Services.
(c): The Merrill Lynch High Yield Master Index consists of issues in the form of
publicly placed non-convertible, coupon-bearing U.S. domestic debt and must
carry a term to maturity of at least one year. Par amounts outstanding must
be no less than $10 million at the start and at the close of the
performance measurement period. Issues must be rated by Standard & Poor's
or by Moody's as less than investment grade (i.e., BBB or Baa) but not in
default (i.e., DD1 or less). The index excludes floating rate debt
equipment trust certificates and Title 11 securities. Source: Merrill
Lynch.
<PAGE>
LOOMIS SAYLES INTERMEDIATE DURATION FIXED INCOME FUND
- --------------------------------------------------------------------------------
The Loomis Sayles Intermediate Duration Fixed Income Fund returned 1.3% for
the second quarter. Relative to the benchmark Lehman Brothers Government/
Corporate Intermediate Bond Index, the Fund underperformed by 57 basis points.
This can be attributed in part to our modest exposure to the Pacific Rim
region as well as our underweighting in longer Treasuries relative to the
benchmark. Investment grade securities received a boost from renewed economic
and political turmoil in Asia and Russia which led investors to abandon high
risk bonds for the relative safety of higher quality dollar denominated
issues. Among investment grade issues, Home Construction, Realty, and Consumer
related issues turned in positive returns over the quarter as they continued
to benefit from the current historically low interest rate environment, strong
domestic consumption, and mild inflation.
The domestic economy continued to demonstrate its resilient ability to expand,
although weak demand from Asia is finally taking a visible toll on
manufacturing and profit margins. This kept the Fed on the sidelines during
the quarter despite tight labor markers and strong domestic consumption.
Higher quality corporate issues outperformed high yield issues as investor
sentiment became increasingly more cautious towards the high yield market amid
further deterioration in the Asian economic crisis and a record amount of new
issuance through the first six months of 1998. Asian and Latin American
spreads widened over the last three months as countries such as Japan, Korea,
and Thailand have yet to establish a credible plan to reform their troubled
banking systems. Domestically, consumer cyclicals continued to benefit from
strong demand, productivity gains, and the historically high level of consumer
confidence. Treasuries, however, were the clear winners benefiting from
increased demand particularly on the longer end of the yield curve. The 30
year Treasury yield fell from 5.93% to 5.62% over the past three months.
In the short time since its inception, the Intermediate Duration Fixed Income
Fund has established a flexible balance of foreign and domestic bonds with
approximately 17% of the portfolio in bonds of foreign issuers, all of which
is U.S. dollar denominated to protect against currency risk. The duration of
the portfolio is longer than that of the Lehman Brothers Government/Corporate
Intermediate Bond Index to capture the higher yield offered by the corporate
curve for extending maturity and to enhance capital appreciation should yield
spreads narrow.
Over the quarter we maintained a higher quality credit profile (A3) as the
situation in Asia unfolded. In addition to our significant asset backed
exposure (5.4% of the Fund), we currently have 7.3% of the portfolio in
shorter Treasuries to capitalize on the flattened yield curve. We have
increased our exposure to the energy sector which now represents nearly 13% of
the portfolio. We believe this sector has become vastly undervalued due to the
temporary excess supply problems in the industry caused by weak demand from
Asia and the lingering effects of El Nino.
Looking forward, we are comfortable with the overall structure of the
portfolio and will continue to search for higher quality call protected bonds
offering above average yields. The Fund offers issue diversification and
adequate balance along the yield curve. We attempt to minimize credit risk and
maximize total return, through bottom-up fundamental research and superior
"bond picking".
Anthony J. Wilkins is the portfolio manager for the Loomis Sayles Intermediate
Duration Fixed Income Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
- ---------------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Since
Inception
Loomis Sayles Intermediate Duration Fixed Income Fund 2.1
Lipper Intermediate Investment Grade Bond Fund Index(b) 2.4
Lehman Brothers Gov't/Corp. Intermediate Bond Index(c) 2.1
- ---------------------------------------------------------------------------
[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 1/28/98 10.00 10.00 10.00
Period Ended
3/31/98 10.08 10.02 10.02
6/30/98 10.21 10.24 10.21
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles Intermediate Duration Fixed Income Fund
is January 28, 1998. Since Lipper Intermediate Investment Grade Bond Fund
Index and Lehman Brothers Government/ Corporate Intermediate Bond Index
performance data is not available coincident with the inception date,
comparative performance is presented from January 31, 1998.
(b): Source: Lipper Analytical Services.
(c): The Lehman Brothers Government/Corporate Intermediate Bond Index consists
of those bonds held within the Lehman Brothers Government/ Corporate Bond
Index which have an average maturity of 1-10 years. The Lehman Brothers
Government/Corporate Bond Index consists of approximately 5,300 corporate
and government issues with at least $100 million outstanding for government
issues and $25 million for corporates, and greater than 1 year maturity.
The index returns have not been lowered for ongoing management and
operating expenses applicable to mutual fund investments.
<PAGE>
LOOMIS SAYLES INVESTMENT GRADE FIXED INCOME FUND
- --------------------------------------------------------------------------------
The Loomis Sayles Investment Grade Fixed Income Fund returned 1.0% for the
second quarter. Relative to the benchmark Lehman Brothers Government/Corporate
Bond Index, the Fund underperformed by l63 basis points. This can be
attributed in part to our modest exposure to the Pacific Rim region as well as
our underweighting in longer Treasuries relative to the benchmark. Investment
grade securities received a boost from renewed economic and political turmoil
in Asia and Russia which led investors to abandon high risk bonds for the
relative safety of higher quality dollar denominated issues. Among investment
grade issues Home Construction, Realty, and Consumer related issues turned in
positive returns over the quarter as they continued to benefit from the
current historically low interest rate environment, strong domestic
consumption, and mild inflation. Canadian Provincial and Government debt
posted modest gains but still underperformed on a relative basis as the US
dollar continued to appreciate over the quarter.
The domestic economy continued to demonstrate its resilient ability to expand,
although weak demand from Asia is finally taking a visible toll on
manufacturing and profit margins. This kept the Fed on the sidelines during
the quarter despite tight labor markets and strong domestic consumption.
Higher quality corporate issues outperformed high yield issues as investor
sentiment became increasingly more cautious towards the high yield market amid
further deterioration in the Asian economic crisis and a record amount of new
issuance through the first six months of 1998. Asian and Latin American
spreads widened over the last three months as countries such as Japan, Korea,
and Thailand have yet to establish a credible plan to reform their troubled
banking systems. Domestically, consumer cyclicals continued to benefit from
strong demand, productivity gains, and the historically high level of consumer
confidence. Treasuries, however, were the clear winners benefiting from
increased demand particularly on the longer end of the yield curve. The 30
year Treasury yield fell from 5.93% to 5.62% over the past three months.
As of the end of quarter, the Fund was well diversified across 139 issues. The
Fund maintains a flexible balance of foreign and domestic bonds with
approximately 40% of the Fund in bonds of foreign issuers, including 18.5% in
Canadian dollar denominated bonds. We continue to favor the Cable/Media and
Telecommunications sectors based upon the positive synergies we feel will be
created for consumers by consolidating wireless, local & long distance, cable,
and internet services. We have increased our exposure to the energy sector. We
believe this sector has become vastly undervalued due to the temporary excess
supply problems in the industry caused by weak demand from Asia and the
lingering effects of El Nino.
Looking forward, we are comfortable with the overall structure of the
portfolio and will continue to search for higher quality call protected bonds
offering above average yields. Despite the recent setback in Asia, we believe
that select emerging market bonds have been unjustly oversold given their
credit profiles and significant yield advantages over domestic bonds and will
continue to add positions on an opportunistic basis.
Daniel J. Fuss is the portfolio manager for the Loomis Sayles Investment Grade
Fixed Income Fund.
<PAGE>
Cumulative Performance Inception(a) to June 30, 1998
- ------------------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
-------------------
Since
Year to date 1 year 3 years Inception
Loomis Sayles Investment Grade
Fixed Income Fund 3.8 10.5 11.8 13.4
Lipper BBB Rated Bond Fund Index(b) 3.8 10.7 8.6 9.6
Lehman Brothers Gov't/Corp.
Bond Index(c) 4.2 11.3 7.9 9.1
- ------------------------------------------------------------------------------
[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 7/1/94 10.00 10.00 10.00
Period Ended
9/30/94 10.08 10.07 10.05
12/31/94 09.97 10.06 10.09
3/31/95 10.75 10.54 10.59
6/30/95 11.82 11.28 11.28
9/30/95 12.27 11.55 11.49
12/31/95 12.99 12.09 12.03
3/31/96 12.91 11.84 11.75
6/30/96 13.07 11.89 11.80
9/30/96 13.60 12.15 12.01
12/31/96 14.40 12.59 12.38
3/31/97 14.23 12.49 12.27
6/30/97 14.96 12.99 12.71
9/30/97 15.68 13.36 13.16
12/31/97 15.93 13.7 13.58
3/31/98 16.37 13.94 13.79
6/30/98 16.53 14.23 14.15
Cumulative Performance Registration(a) to June 30, 1998
- ----------------------------------------------------------------------
Average Returns (%) - Period Ended June 30, 1998
Annualized
----------
Since
Year to date 1 year Registration
Loomis Sayles Investment Grade 3.8 10.5 10.7
Fixed Income Fund
Lipper BBB Rated Bond Fund Index(b) 3.8 10.7 12.0
Lehman Brothers Gov't/Corp.
Bond Index(c) 4.2 11.3 12.1
- -------------------------------------------------------------------------
[A line graph depicting the following plot points appears here.]
Loomis Lipper Lehman
As of 3/7/97 10.00 10.00 10.00
Period Ended
3/31/97 9.84 10.00 10.00
6/30/97 10.34 10.41 10.36
9/30/97 10.84 10.80 10.73
12/31/97 11.01 11.07 11.07
3/31/98 11.32 11.27 11.24
6/30/98 11.43 11.5 11.53
Note: Past performance is not predictive of future performance.
(a): Inception date of the Loomis Sayles Investment Grade Fixed Income Fund is
July 1, 1994. Shares of the Fund were registered for offer and sale under
the Securities Act of 1933 on March 7, 1997. In accordance with SEC
regulations, performance information is provided for the period beginning
on March 7, 1997 ("Registration"). For the convenience of our long-term
shareholders, performance information is also provided for the period
beginning on July 1, 1994 ("Inception"). Since Lipper BBB Rated Bond Fund
Index & Lehman Brothers Government/Corporate Bond Index performance data is
not available coincident with the registration date, comparative
performance is presented from March 31, 1997.
(b): Source: Lipper Analytical Services.
(c): Lehman Brothers Government/Corporate Bond Index is a composite of
approximately 5,300 corporate and government issues with at least $100
million outstanding for government issues and $25 million for corporate,
and greater than 1 year maturity. The index returns have not been lowered
for ongoing management and operating expenses applicable to mutual fund
investments. Source: Lehman Brothers.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
LOOMIS SAYLES CALIFORNIA TAX-FREE INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- ---------------------------------------------------------------------------------------------
BONDS AND NOTES -- 2.9% of Net Assets
<S> <C> <C>
Federal Home Loan Mortgage Corp., 8.060%, 7/10/06 .......... $ 500,000 $ 501,405
------------
TOTAL BONDS AND NOTES (Identified Cost $505,000)............. 501,405
------------
MUNICIPAL BONDS AND NOTES -- 93.4% of Net Assets
California Health Facilities Authority, Series A,
6.750%, 10/01/19 ......................................... 500,000 524,345
California Housing Finance Agency, (MBIA Insured),
5.200%, 8/01/05 .......................................... 245,000 258,463
California Housing Finance Agency, (MBIA Insured),
5.500%, 8/01/17 .......................................... 500,000 512,925
California Housing Finance Agency, (MBIA Insured),
5.850%, 8/01/09 .......................................... 300,000 323,163
California Pollution Control, 5.000%, 4/01/08 .............. 425,000 439,344
California Pollution Control, 5.900%, 6/01/14 .............. 400,000 439,108
California Resource Efficiency Financing, First Resource
Efficiency, (AMBAC Insured), 5.400%, 7/01/04 ............. 150,000 158,844
California State General Obligations, 5.500%, 6/01/01 ...... 500,000 519,645
California State General Obligations, 5.750%, 3/01/13 ...... 505,000 537,138
California State General Obligations, (MBIA Insured),
6.000%, 10/01/14 ......................................... 10,000 10,794
California State General Obligations Prerefunded, (MBIA
Insured), 6.000%, 10/01/14 ............................... 240,000 262,378
California State Public Works Board, Community College,
5.200%, 3/01/06 .......................................... 200,000 209,376
California State Public Works Board, Community College,
5.200%, 4/01/07 .......................................... 500,000 524,390
California State Public Works Lease, 5.400%, 4/01/04 ....... 200,000 210,294
California State Water Resources Development,
5.000%, 3/01/01 .......................................... 200,000 201,078
Clovis, California, Unified School District, (FGIC Insured),
Zero Coupon Bond, 8/01/04 ................................ 200,000 153,320
Clovis, California, Unified School District, (FGIC Insured),
10.625%, 8/01/03 ......................................... 200,000 257,336
Corona, California, Single Family, 5.500%, 11/01/10 ........ 400,000 421,880
East Bay California Municipal Utility Water Systems,
6.000%, 6/01/12 .......................................... 500,000 537,185
Industry, California, (MBIA Insured), 5.700%, 7/01/18 ...... 290,000 303,926
Los Angeles State Building Authority, Lease Revenue,
5.375%, 5/01/06 .......................................... 300,000 316,746
Los Angeles, California, Wastewater Systems, (FGIC Insured),
5.375%, 11/01/07 ......................................... 450,000 476,608
Los Angeles, California, Water and Power Waterworks Revenue,
6.500%, 11/01/10 ......................................... 350,000 378,500
Mid-Peninsula, California, Regional Open Space,
5.500%, 9/01/07 .......................................... 100,000 104,371
Northern California Power Agency, Public Revenue,
5.250%, 7/01/02 .......................................... 250,000 255,855
Oceanside, California, Water Systems, (AMBAC Insured),
5.650%, 8/01/09 .......................................... 125,000 133,285
Riverside, California, Electric Revenue, (MBIA Insured),
5.200%, 10/01/08 ......................................... 230,000 240,267
Sacramento, California, Electric Revenue, 5.250%, 5/15/04 .. 250,000 261,857
Sacramento, California, Electric Revenue, 5.700%, 5/15/12 .. 500,000 523,885
Sacramento, California, Power Authority, 6.000%, 7/01/02 ... 500,000 528,015
San Diego, California, Industrial Development Revenue (AMBAC
Insured), 5.900%, 6/01/18 ................................ 350,000 371,574
San Diego, California, Open Space Park Facility, District
One, 5.750%, 1/01/08 ..................................... 250,000 267,945
San Diego, California, Sewer Revenue, (AMBAC Insured),
4.750%, 5/15/06 .......................................... 125,000 127,774
San Francisco Bay Area Rapid Transit Authority, (FGIC
Insured), 5.450%, 7/01/08 ................................ 200,000 213,066
San Francisco, California, City & County International
Airport Revenue, (AMBAC Insured), 6.200%, 5/01/04 ........ 300,000 324,957
San Francisco, California, City & County Library Facilities,
Series D, 6.100%, 6/15/07 ................................ 250,000 264,820
San Francisco, California, City & County Public Utility Water
Revenue, Series A, 6.375%, 11/01/06 ...................... 500,000 549,200
San Francisco, California, City & County Redevelopment
Project, Series B, 5.200%, 8/01/08 ....................... 250,000 255,825
San Francisco, California, Port Commission, 5.500%, 7/01/04 100,000 104,803
San Francisco, California, Public Utilities, 6.000%, 11/01/15 500,000 525,475
San Francisco, California, Sewer Revenue, (AMBAC Insured),
6.000%, 10/01/11 ......................................... 500,000 540,285
San Francisco, California, State Building Authority,
5.000%, 10/01/05 ......................................... 125,000 129,049
San Francisco, California, State Building Authority,
5.125%, 10/01/07 ......................................... 250,000 260,410
San Jose, California, Airport Revenue, (FGIC Insured),
5.875%, 3/01/07 .......................................... 200,000 220,774
Santa Clara Valley, California, Water District Refunding &
Improvements, Series A, (FGIC Insured), 5.800%, 2/01/08 .. 100,000 108,031
Santa Clara, California, Electric Revenue, (FGIC Insured),
6.250%, 7/01/13 .......................................... 250,000 270,493
Turlock, California, Irrigation District Revenue,
5.750%, 1/01/18 .......................................... 500,000 515,945
University of California Revenue, Series B, 5.800%, 9/01/07 415,000 453,163
University of California Revenue, Series B, 6.500%, 9/01/03 300,000 329,091
University of California Revenue, Series C, 5.000%, 9/01/08 175,000 180,612
University of California Revenue, Series C, (AMBAC Insured),
4.700%, 9/01/06 .......................................... 200,000 204,002
------------
TOTAL MUNICIPAL BONDS AND NOTES (Identified Cost $15,716,283)
16,241,615
------------
SHORT-TERM INVESTMENT -- 2.2% of Net Assets
Repurchase Agreement with State Street Bank and Trust Co.,
dated 6/30/98 at 5.000% to be repurchased at $390,054 on
7/01/98 collateralized by $305,000 U.S. Treasury Bond,
8.125%, due 8/15/19 with a value of $400,643 ............. 390,000 390,000
------------
TOTAL SHORT-TERM INVESTMENT
(Identified Cost $390,000)............................... 390,000
------------
TOTAL INVESTMENTS -- 98.5%
(IDENTIFIED COST $16,611,283) (b) ......................... 17,133,020
Cash and Other Assets, Less Liabilities -- 1.5%................ 265,126
------------
NET ASSETS -- 100% ............................................ $ 17,398,146
============
</TABLE>
(a) See Note 1.
(b) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $16,611,283 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $533,656 and $11,919, respectively, resulting in net
unrealized appreciation of $521,737.
Key to Abbreviations:
AMBAC: American Municipal Bond Assurance Corporation
FGIC: Federal Guaranty Insurance Corporation
MBIA: Municipal Bond Insurance Association
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
LOOMIS SAYLES CALIFORNIA TAX-FREE INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited) -- continued
Ten Largest Holdings by Municipal Classification at June 30, 1998
as a Percentage of Net Assets
General Obligation 22.0%
Revenue 16.2%
Water & Sewer 14.1%
Education 10.3%
Electric 8.9%
Utilities 7.0%
Public Works 4.5%
Correctional Facilities 3.0%
Health/Hosptial 3.0%
Certificates of Participation 2.9%
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
LOOMIS SAYLES CORE FIXED INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- -------------------------------------------------------------------------------------------------
BONDS AND NOTES -- 97.9% of Net Assets
<S> <C> <C>
Aerospace -- 1.7%
Lockheed Corp., 9.000%, 1/15/22 .......................... $ 256,000 $ 326,464
-------------
Banks/Savings & Loans -- 6.5%
Capital One Bank, 5.950%, 2/15/01 ........................ 250,000 247,985
Chase Manhattan Corp., 7.625%, 1/15/03 ................... 200,000 211,592
First America Bank Corp., 7.750%, 7/15/04 ................ 150,000 161,281
NCNB Corp., 9.125%, 10/15/01 ............................. 100,000 108,820
Standard Federal Bank, 7.750%, 7/17/06 ................... 450,000 492,273
-------------
1,221,951
-------------
Computers -- 2.0%
Seagate Technology, Inc., 7.125%, 3/01/04 ................ 122,000 120,540
Seagate Technology, Inc., 7.370%, 3/01/07 ................ 265,000 262,066
-------------
382,606
-------------
Diversified Operations -- 2.7%
Norfolk Southern Corp., 7.800%, 5/15/27 .................. 450,000 516,379
-------------
Entertainment -- 3.4%
Time Warner Entertainment Co., 7.250%, 9/01/08 ........... 600,000 631,794
-------------
Environmental Services -- 0.8%
WMX Technologies, Inc., 6.375%, 12/01/03 ................. 143,000 143,102
-------------
Financial Services -- 8.7%
Advanta Corp., 7.000%, 5/01/01 ........................... 100,000 93,760
AT & T Capital Corp., 6.390%, 1/22/99 .................... 225,000 225,488
Ford Motor Credit Co., 7.750%, 11/15/02 .................. 200,000 212,482
Ford Motor Credit Co., 8.000%, 6/15/02 ................... 350,000 373,734
General Motors Acceptance Corp., 5.625%, 2/15/01 ......... 27,000 26,806
General Motors Acceptance Corp., 6.800%, 4/17/01 ......... 200,000 203,864
General Motors Acceptance Corp., 7.125%, 5/01/01 ......... 225,000 231,149
USL Capital Corp., 7.050%, 5/14/01 ....................... 275,000 282,876
-------------
1,650,159
-------------
Food -- Packaged & Miscellaneous -- 2.7%
ConAgra, Inc., 9.750%, 3/01/21 ........................... 375,000 500,573
-------------
Foreign Issuer -- 5.6%
Philips Electronics NV, 8.375%, 9/15/06 .................. 515,000 579,117
Saga Petroleum ASA, 7.250%, 9/23/27 ...................... 450,000 468,486
-------------
1,047,603
-------------
Government Agencies -- 5.3%
Federal Home Loan Mortgage Corp., 6.500%, 1/01/27 ........ 118,091 117,758
Federal Home Loan Mortgage Corp., 7.000%, 1/01/12 ........ 100,364 102,538
Federal Home Loan Mortgage Corp., 8.000%, 7/01/25 ........ 37,760 39,070
Federal Home Loan Mortgage Corp., 8.000%, 12/01/26 ....... 87,623 90,634
Federal National Mortgage Association, 7.500%, 1/01/27 ... 181,526 186,177
Federal National Mortgage Association, 9.500%, 11/01/10 .. 52,968 55,906
Government National Mortgage Association, 6.500%, 4/15/26 136,624 136,496
Government National Mortgage Association, 8.500%, 4/15/23 114,997 121,751
Government National Mortgage Association, 9.500%, 9/15/20 134,927 146,023
-------------
996,353
-------------
Health Care -- Services -- 1.0%
Columbia Healthcare Corp., 6.125%, 12/15/00 .............. 200,000 194,272
-------------
Holding Companies -- Diversified -- 1.3%
ITT Corp., 7.400%, 11/15/25 .............................. 225,000 239,515
-------------
Oil & Gas -- 5.5%
Columbia Gas Systems, Inc., 7.050%, 11/28/07 ............. 675,000 690,653
Ensco International, Inc., 6.750%, 11/15/07 .............. 350,000 353,416
-------------
1,044,069
-------------
Paper Products -- 2.4%
Boise Cascade Corp., 9.800%, 4/15/03 ..................... 200,000 226,688
Boise Cascade Corp., 9.980%, 3/27/03 ..................... 200,000 227,956
-------------
454,644
-------------
Real Estate Investment Trusts -- 1.3%
Developers Diversified Realty, 6.800%, 7/23/02 ........... 125,000 126,929
Meditrust Corp., 7.375%, 7/15/00 ......................... 125,000 125,940
-------------
252,869
-------------
Securities -- 4.7%
Lehman Brothers Holdings, Inc., 6.125%, 2/01/01 .......... 483,000 482,947
Lehman Brothers Holdings, Inc., 7.250%, 4/15/03 .......... 150,000 155,847
Salomon, Inc., 6.650%, 7/15/01 ........................... 245,000 248,800
-------------
887,594
-------------
Telecommunications -- 5.4%
TCI Communications, Inc., 8.750%, 8/01/15 ................ 400,000 481,568
Worldcom, Inc., 7.550%, 4/01/04 .......................... 500,000 529,510
-------------
1,011,078
-------------
Transportation -- 2.4%
Union Pacific Corp., 6.625%, 2/01/08 ..................... 200,000 199,632
Union Pacific Corp., 6.700%, 12/01/06 .................... 260,000 261,399
-------------
461,031
-------------
U.S. Government -- 24.9%
U.S. Treasury Bonds, 6.250%, 8/15/23 ..................... 505,000 540,663
U.S. Treasury Bonds, 7.250%, 5/15/16 ..................... 345,000 404,188
U.S. Treasury Notes, 6.250%, 2/15/07 ..................... 600,000 628,314
U.S. Treasury Notes, 6.375%, 8/15/02 ..................... 600,000 618,372
U.S. Treasury Notes, 7.250%, 8/15/04 ..................... 2,305,000 2,507,771
-------------
4,699,308
-------------
Utilities -- 9.6%
Boston Edison Co., 6.800%, 3/15/03 ....................... 400,000 407,400
Commonwealth Edison Co., 7.375%, 1/15/04 ................. 500,000 519,210
Gulf States Utilities Co., 6.410%, 8/01/01 ............... 435,000 435,509
Midamerican Energy Co., 6.500%, 12/15/01 ................. 441,000 446,755
-------------
1,808,874
-------------
TOTAL BONDS AND NOTES
(Identified Cost $18,125,552).......................... 18,470,238
-------------
TOTAL INVESTMENTS -- 97.9%
(IDENTIFIED COST $18,125,552) (b) ....................... 18,470,238
Cash and Other Assets, Less Liabilities -- 2.1%............. 401,968
-------------
TOTAL NET ASSETS -- 100% .................................... $ 18,872,206
=============
</TABLE>
(a) See Note 1.
(b) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $18,125,552 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $372,936 and $28,250, respectively, resulting in net
unrealized appreciation of $344,686.
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
LOOMIS SAYLES CORE GROWTH FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Shares Value (a)
- -------------------------------------------------------------------------------------------------
COMMON STOCKS -- 93.7% of Net Assets
<S> <C> <C>
Auto & Related -- 5.0%
Chrysler Corp. ........................................... 11,500 $ 648,312
Magna International, Inc. ................................ 6,700 459,788
-------------
1,108,100
-------------
Banks/Savings & Loans -- 4.1%
Star Banc Corp. .......................................... 5,400 344,925
Wells Fargo & Co. ........................................ 1,500 553,500
-------------
898,425
-------------
Broadcasting -- 2.4%
CBS Corp. ................................................ 16,700 530,225
-------------
Chemicals -- Specialty -- 5.3%
E.I. du Pont DeNemours & Co. ............................. 6,900 514,913
Monsanto Co. ............................................. 11,900 664,912
-------------
1,179,825
-------------
Computer Hardware -- 8.4%
Cisco Systems, Inc. (b) .................................. 6,300 579,994
EMC Corp. (b) ............................................ 13,000 582,562
International Business Machines Corp. .................... 6,100 700,356
-------------
1,862,912
-------------
Computer Software & Services -- 1.9%
Computer Associates International, Inc. .................. 7,700 427,831
-------------
Electronics -- 1.7%
Analog Devices, Inc. (b) ................................. 15,611 383,445
-------------
Entertainment -- 3.4%
Time Warner, Inc. ........................................ 8,700 743,306
-------------
Financial Services -- 5.1%
American Express Co. ..................................... 5,400 615,600
Associates First Capital Corp. ........................... 6,700 515,063
-------------
1,130,663
-------------
Food -- Packaged & Miscellaneous -- 5.5%
Heinz (H.J.) Co. ......................................... 9,100 510,737
Unilever NV .............................................. 8,900 702,544
-------------
1,213,281
-------------
Health Care -- Drugs -- 10.4%
Pfizer, Inc. ............................................. 6,300 684,731
Schering-Plough Corp. .................................... 7,800 714,675
Warner Lambert Co. ....................................... 12,900 894,938
-------------
2,294,344
-------------
Health Care -- Medical Technology -- 2.9%
Medtronic, Inc. .......................................... 10,200 650,250
-------------
Imaging -- 2.6%
Xerox Corp. .............................................. 5,600 569,100
-------------
Oil & Gas Exploration -- 4.3%
Abacan Resources Corp. (New) (b) ......................... 52,600 32,875
Anadarko Petroleum Corp. ................................. 6,300 423,281
Burlington Resources, Inc. ............................... 11,300 486,607
-------------
942,763
-------------
Oil & Gas -- Major Integrated -- 2.4%
Royal Dutch Petroleum Co. (N.Y. Shares) .................. 9,500 520,719
-------------
Personal Care -- 2.5%
Gillette Co. ............................................. 9,600 544,200
-------------
Restaurants -- 2.9%
McDonald's Corp. ......................................... 9,300 641,700
-------------
Retail -- Food & Drug -- 5.7%
CVS Corp. ................................................ 17,400 677,512
Safeway, Inc. (b) ........................................ 14,500 589,969
-------------
1,267,481
-------------
Retail -- General -- 2.8%
Staples, Inc. (b) ........................................ 21,200 613,475
-------------
Retail -- Specialty -- 2.4%
Circuit City Stores, Inc. ................................ 11,500 539,063
-------------
Telecommunications -- 10.4%
BellSouth Corp. .......................................... 10,000 671,250
Ericsson LM .............................................. 19,600 561,050
Tellabs, Inc. (b) ........................................ 5,400 386,775
WorldCom, Inc. (b) ....................................... 13,900 673,281
-------------
2,292,356
-------------
Utilities -- Electric -- 1.6%
AES Corp. (b) ............................................ 6,500 341,656
-------------
TOTAL COMMON STOCKS
(Identified Cost $17,473,971).......................... 20,695,120
-------------
SHORT-TERM INVESTMENT -- 6.2% of Net Assets
Repurchase Agreement with State Street Bank and Trust Co.,
dated 6/30/98 at 5.000% to be repurchased at $1,366,190
on 7/01/98 collateralized by $1,065,000 U.S. Treasury
Bond, 8.125%, due 8/15/19 with a value of $1,398,965 ... 1,366,000 1,366,000
-------------
TOTAL SHORT-TERM INVESTMENT
(Identified Cost $1,366,000)........................... 1,366,000
-------------
TOTAL INVESTMENTS -- 99.9%
(IDENTIFIED COST $18,839,971) (c) 22,061,120
Cash and Other Assets, Less Liabilities -- 0.1%.............. 14,375
-------------
NET ASSETS -- 100% .......................................... $ 22,075,495
=============
</TABLE>
(a) See Note 1.
(b) Non-income producing security.
(c) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $18,839,971 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $3,623,980 and $402,831, respectively, resulting in net
unrealized appreciation of $3,221,149.
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
LOOMIS SAYLES FIXED INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- ---------------------------------------------------------------------------------------------------
BONDS AND NOTES -- 95.9% of Net Assets
<S> <C> <C> <C>
NON-CONVERTIBLE BONDS -- 85.4%
Broadcasting -- 0.7%
Fox Family Worldwide, Inc., Zero Coupon Bond,
11/01/07 (step to 10.250% on 11/01/02) (b) ....... USD 2,100,000 $ 1,365,000
-------------
Canadian -- 19.2%
Canadian Government, Zero Coupon Bond, 6/01/22 ..... CAD 2,500,000 455,953
Canadian Government, Zero Coupon Bond, 6/01/25 ..... 61,460,000 9,640,702
Hydro Quebec, Zero Coupon Bond, 8/15/20 ............ 7,500,000 1,342,339
New Brunswick FM Project, Zero Coupon Bond, 11/30/27
(step to 6.470% on 5/30/03) 144A (b) (c) ......... 1,250,000 657,908
Province of Alberta, 5.930%, 9/16/16 ............... 1,616,991 1,134,518
Province of British Columbia, Zero Coupon Bond,
8/23/13 ........................................... 11,700,000 3,324,999
Province of British Columbia, Zero Coupon Bond,
9/08/23 ........................................... 3,300,000 508,435
Province of British Columbia, Zero Coupon Bond,
8/23/24 ........................................... 8,500,000 1,237,878
Province of British Columbia, Zero Coupon Bond,
11/19/27 ......................................... 8,150,000 966,719
Province of British Columbia, 8.000%, 9/08/23 ...... 3,300,000 2,880,137
Province of Manitoba, 6.500%, 9/22/17 .............. 5,075,000 3,774,865
Province of Manitoba, 7.750%, 12/22/25 ............. 5,295,000 4,592,627
Province of Newfoundland, 6.150%, 4/17/28 .......... 1,000,000 697,200
Province of Ontario, Zero Coupon Bond, 7/13/22 12,200,000 2,034,094
Province of Saskatchewan, Zero Coupon Bond, 4/10/14 5,000,000 1,367,178
Province of Saskatchewan, 8.750%, 5/30/25 .......... 1,950,000 1,852,530
Province of Saskatchewan (Certificate of Deposit),
Zero Coupon Bond, 2/04/22 ........................ 10,000,000 1,716,969
Province of Saskatchewan (Certificate of Deposit),
Zero Coupon Bond, 5/30/25 ........................ 2,425,000 342,927
Rogers Cablesystems Ltd., 9.650%, 1/15/14 .......... 250,000 196,215
-------------
38,724,193
-------------
Communications -- 0.4%
Arch Communications Group, Inc., Zero Coupon Bond,
3/15/08 (step to 10.875% on 3/15/01) (b) ......... USD 1,600,000 912,000
-------------
Computers -- 1.7%
Apple Computer, Inc., 6.500%, 2/15/04 .............. 1,325,000 1,219,000
Seagate Technology, Inc., 7.450%, 3/01/37 .......... 2,225,000 2,185,640
Streamlogic Corp., 14.000%, 10/07/98 (d) (e) ....... 28,333 1,416
-------------
3,406,056
-------------
Electronics -- 0.3%
Westinghouse Electric Corp., 7.875%, 9/01/23 ....... 500,000 513,885
-------------
Entertainment -- 4.9%
Time Warner Entertainment Co., 6.875%, 6/15/18 ...... 2,840,000 2,851,076
Time Warner Entertainment Co., 6.950%, 1/15/28 ...... 3,750,000 3,760,725
Time Warner Entertainment Co., 7.570%, 2/01/24 ...... 3,125,000 3,361,312
-------------
9,973,113
-------------
Food & Beverage -- 0.7%
Borden, Inc., 7.875%, 2/15/23 ...................... 1,500,000 1,475,670
-------------
Foreign Government/Agency -- 6.2%
Escom, 11.000%, 6/01/08 ............................ ZAR 2,500,000 322,598
New South Wales Treasury, Zero Coupon Bond, 11/23/20. AUD 5,300,000 874,968
Republic of Brazil, 10.125%, 5/15/27 ............... USD 4,277,000 3,682,497
Republic of Brazil C Bond, 8.000%, 4/15/14 PIK (f)... 5,424,003 4,000,202
Republic of South Africa, 12.000%, 2/28/05 ......... ZAR 10,500,000 1,519,008
Republic of South Africa, 12.500%, 12/21/06 ........ 4,000,000 578,921
Republic of Venezuela, 9.250%, 9/15/27 ............. USD 2,000,000 1,545,000
-------------
12,523,194
-------------
Foreign Issuer -- 10.1%
Bangko Sentral Pilipinas, 8.600%, 6/15/27 .......... 1,250,000 1,075,000
Bangkok Bank Public Co. Ltd., 8.250%, 3/15/16 144A(c) 100,000 74,861
Bangkok Bank Public Co. Ltd., 8.375%, 1/15/27 144A(c) 3,100,000 2,267,309
Compania de Transporte Energia, 9.250%,
4/01/08 144A (c) ................................. 1,000,000 975,000
Export Import Bank of Korea, 6.375%, 2/15/06 ....... USD 500,000 375,801
Hyundai Motor Co. Ltd., 7.600%, 7/15/07 144A (c) ... 750,000 583,590
Korea Electric Power Corp., 6.750%, 8/01/27 ........ 500,000 397,755
Korea Electric Power Corp., 7.400%, 4/01/16 ........ 1,218,906 977,306
Korea Electric Power Corp., 7.750%, 4/01/13 ........ 1,000,000 739,320
Multicanal SA, 10.500%, 4/15/18 144A (c) ........... 500,000 465,000
Petroleos Mexicanos, 9.500%, 9/15/27 ............... 1,350,000 1,271,025
Petroleos Mexicanos, Medium Term, 8.625%, 12/01/23 .. 250,000 215,313
Philippine Long Distance Telephone Co.,
8.350%, 3/06/17 .................................. 250,000 213,142
Pindo Deli Finance Mauritius Ltd.,
10.750%, 10/01/07 ................................ 500,000 350,000
Pindo Deli Finance Mauritius Ltd.,
10.875%, 10/01/27 ................................ 2,250,000 1,327,500
Pindo Deli Finance Mauritius Ltd.,
11.750%, 10/01/17 ................................ 1,500,000 1,003,125
Pohang Iron & Steel Co. Ltd., 6.625%, 7/01/03 ...... 200,000 161,902
Pohang Iron & Steel Co. Ltd., 7.125%, 11/01/06 ...... 500,000 385,945
Quezon Power Philippines Co., 8.860%, 6/15/17 ....... 1,200,000 1,032,240
Samsung Electronics Co. Ltd., 7.700%, 10/01/27 144A(c) 2,000,000 1,300,000
Samsung Electronics Co. Ltd., 8.500%, 11/01/02 144A(c) 1,000,000 906,820
Siam Commercial Bank Public Co.,
7.500%, 3/15/06 144A (c) ......................... 750,000 616,035
Tata Electric Co., 8.500%, 8/19/17 144A (c) ........ 2,000,000 1,680,000
Tenaga Nasional Berhad, 7.500%, 11/01/25 144A (c).... 250,000 186,765
Tjiwi Kimia Mauritius Ltd., 10.000%, 8/01/04 ....... 300,000 213,000
Total Access Communication Public Co. Ltd., 7.625%,
11/04/01 144A (c) ................................ 500,000 380,000
Total Access Communication Public Co. Ltd., 8.375%,
11/04/06 144A (c) ................................ 1,750,000 1,260,000
-------------
20,433,754
-------------
Government Agencies -- 2.2%
Federal National Mortgage Association, Zero Coupon
Bond, 10/29/07 ................................... NZD 11,450,000 $ 3,218,897
Federal National Mortgage Association, 6.000%,
11/25/08 PIK (f) ................................. USD 1,282,809 1,242,311
-------------
4,461,208
-------------
Health Care -- Services -- 0.8%
Columbia/HCA Healthcare Corp., 7.050%, 12/01/27 .... 1,250,000 1,119,713
Columbia/HCA Healthcare Corp., 7.580%, 9/15/25 ..... 500,000 478,220
-------------
1,597,933
-------------
Home Builders -- 0.5%
Pulte Corp., 7.625%, 10/15/17 ...................... 1,000,000 1,051,940
-------------
Oil & Gas -- 3.2%
Chesapeake Energy Corp., 8.500%, 3/15/12 ........... 500,000 467,500
R&B Falcon Corp., 7.375%, 4/15/18 144A (c) ......... 2,500,000 2,546,175
Seagull Energy Corp., 7.500%, 9/15/27 .............. 3,500,000 3,489,640
-------------
6,503,315
-------------
Real Estate Investment Trusts -- 3.3%
AMB Property Corp., 7.500%, 6/30/18 ................ 1,500,000 1,507,230
First Industrial, 7.500%, 12/01/17 ................. 3,000,000 3,061,098
Security Capital Group, Inc., 7.700%, 6/15/28 144A (c) 2,000,000 2,023,400
-------------
6,591,728
-------------
Retail -- General -- 1.9%
Dillon Read Structured Finance Corp.,
6.660%, 8/15/10 .................................. 211,105 195,809
Dillon Read Structured Finance Corp.,
8.550%, 8/15/19 .................................. 500,000 500,625
K Mart Corp., 7.950%, 2/01/23 ...................... 1,250,000 1,259,375
Penn Traffic Co., 9.625%, 4/15/05 .................. 2,750,000 1,065,625
Woolworth Corp., 8.500%, 1/15/22 ................... 725,000 799,653
-------------
3,821,087
-------------
Supranational -- 3.3%
International Bank for Reconstruction & Development,
Zero Coupon Bond, 8/20/07 ........................ NZD 21,750,000 6,067,046
International Bank for Reconstruction & Development,
8.000%, 5/23/07 .................................. 1,000,000 551,656
-------------
6,618,702
-------------
Taxable Municipal -- 0.3%
Orange County, California Pension Obligation, Zero
Coupon Bond, 9/01/16 ............................. USD 2,000,000 576,140
-------------
Telecommunications -- 3.4%
Nextel Communications, Inc., Zero Coupon Bond, 10/31/07
(step to 9.750% on 10/31/02) (b) 2,725,000 1,778,063
Nextlink Communications, Inc., Zero Coupon Bond,
4/15/08 (step to 9.450% on 4/15/03) (b) ........... 1,000,000 615,000
RCN Corp., Zero Coupon Bond, 10/15/07 (step to
11.125% on 10/15/02) (b) ......................... 1,000,000 642,500
RCN Corp., Zero Coupon Bond, 2/15/08 (step to 9.800%
on 2/15/03) (b) .................................. 350,000 210,000
RCN Corp., Zero Coupon Bond, 7/01/08 (step to 11.000%
on 7/01/03) (b) .................................. 2,100,000 1,249,500
TCI Communications, Inc., 7.125%, 2/15/28 .......... 1,640,000 1,712,160
TCI Communications, Inc., 7.875%, 2/15/26 .......... 650,000 738,894
-------------
6,946,117
-------------
Textile & Apparel -- 1.3%
Fruit of the Loom, Inc., 7.375%, 11/15/23 .......... 500,000 452,560
Kellwood Co., 7.625%, 10/15/17 ..................... 2,000,000 2,119,060
Phillips Van Heusen Corp., 7.750%, 11/15/23 ........ 50,000 46,429
-------------
2,618,049
-------------
Tobacco -- 5.8%
Loews Corp., 7.000%, 10/15/23 ...................... 500,000 484,195
Philip Morris Cos., Inc., 7.750%, 1/15/27 .......... 5,800,000 6,204,028
RJR Nabisco, Inc., 7.625%, 9/15/03 ................. 2,625,000 2,609,906
RJR Nabisco, Inc., 9.250%, 8/15/13 ................. 2,250,000 2,426,985
-------------
11,725,114
-------------
Transportation -- 0.5%
American President Cos. Ltd., 7.125%, 11/15/03 ...... USD 1,000,000 807,460
American President Cos. Ltd., 8.000%, 1/15/24 ....... 150,000 105,843
-------------
913,303
-------------
U.S. Government -- 12.8%
U.S. Treasury Bonds, 6.000%, 2/15/26 ............... 19,000,000 19,765,890
U.S. Treasury Bonds, 6.250%, 8/15/23 ............... 5,620,000 6,016,884
-------------
25,782,774
-------------
Utilities -- 1.9%
AES Corp., 8.875%, 11/01/27 ........................ 1,000,000 987,500
Boston Edison Co., 7.800%, 3/15/23 ................. 500,000 529,991
KN Capital Trust, 7.630%, 4/15/28 .................. 1,000,000 1,024,580
Mobile Energy Services Co. LLC,
8.665%, 1/01/17 .................................. 1,306,305 666,215
Niagara Mohawk Power Corp., Zero Coupon Bond, 7/01/10
(step to 8.500% on 7/1/03) (b) 1,000,000 691,250
-------------
3,899,536
-------------
TOTAL NON-CONVERTIBLE BONDS (Identified Cost
$167,033,030) ..................................... 172,433,811
-------------
CONVERTIBLE BONDS -- 10.5%
Auto & Related -- 0.3%
Exide Corp., 2.900%, 12/15/05 144A (c) ............. 1,000,000 617,500
-------------
Canadian -- 0.1%
Rogers Communications, Inc., 2.000%, 11/26/05 250,000 155,000
-------------
Commercial Services -- 0.0%
Molten Metal Technology, Inc., 5.500%, 5/01/06 (d)(e) 550,000 22,000
-------------
Computers -- 0.7%
Cray Research, Inc., 6.125%, 2/01/11 ............... 463,000 377,345
Maxtor Corp., 5.750%, 3/01/12 ...................... 407,000 284,900
Read Rite Corp., 6.500%, 9/01/04 ................... 900,000 567,000
Silicon Graphics, Inc., 5.250%, 9/01/04 ............ 300,000 255,936
-------------
1,485,181
-------------
Diversified Operations -- 0.4%
Ogden Corp., 5.750%, 10/20/02 ...................... USD 500,000 491,250
Ogden Corp., 6.000%, 6/01/02 ....................... 250,000 247,500
-------------
738,750
-------------
Electronics -- 1.9%
Cirrus Logic, Inc., 6.000%, 12/15/03 144A (c) ...... 200,000 158,250
Kent Electronics Corp., 4.500%, 9/01/04 ............ 1,625,000 1,328,437
Lam Research Corp., 5.000%, 9/01/02 ................ 1,925,000 1,578,500
National Semiconductor Corp., 6.500%, 10/01/02 200,000 183,000
Richardson Electronics Ltd., 7.250%, 12/15/06 ...... 300,000 288,000
Zenith Corp., 6.250%, 4/01/11 (d) .................. 1,121,000 284,454
-------------
3,820,641
-------------
Environmental Services -- 0.8%
Air & Water Technologies Corp., 8.000%, 5/15/15 .... 475,000 394,250
Thermo TerraTech, Inc., 4.625%, 5/01/03 144A (c) ... 1,500,000 1,344,375
-------------
1,738,625
-------------
Foreign Issuer -- 2.5%
Advanced Agro Public Co., 3.500%, 6/17/01 .......... 125,000 112,500
Bangkok Bank Public Co. Ltd., 3.250%, 3/03/04 900,000 292,500
Banpu Public Co., 2.750%, 4/10/03 .................. 1,455,000 996,675
Burns, Philp, 5.500%, 4/30/04 ...................... 1,000,000 570,000
Empresas ICA Sociedad, 5.000%, 3/15/04 ............. 250,000 178,437
Loxley Public Co. Ltd., 2.500%, 4/04/01 ............ 700,000 224,000
Piltel, 1.750%, 7/17/06 ............................ 250,000 194,375
Samsung Corp., 0.250%, 6/26/06 ..................... 600,000 552,000
Samsung Electronics Co. Ltd., Zero Coupon Bond,
12/31/07 ......................................... 500,000 390,000
Sappi BVI Finance, 7.500%, 8/01/02 ................. 100,000 93,250
Siam Commercial Bank Public Co., 3.250%, 1/24/04 ... 375,000 127,500
Ssangyong Oil Refining Co., Inc., 3.000%, 12/31/04 . 500,000 235,000
Ssangyong Oil Refining Co., Inc., 3.750%, 12/31/08 . 150,000 119,250
Telekom Malaysia Berhad, 4.000%, 10/03/04 .......... USD 500,000 365,000
Total Access Communication Public Co. Ltd.,
2.000%, 5/31/06 .................................. 900,000 684,000
-------------
5,134,487
-------------
Freight Transportation -- 0.1%
Worldway Corp., 6.250%, 4/15/11 .................... 250,000 207,500
-------------
Health Care -- Drugs -- 0.3%
Glycomed, Inc., 7.500%, 1/01/03 .................... 300,000 282,000
NABI, Inc., 6.500%, 2/01/03 ........................ 525,000 345,844
-------------
627,844
-------------
Home Builders -- 0.2%
Schuler Homes, Inc., 6.500%, 1/15/03 ............... 400,000 360,000
-------------
Machinery -- 0.1%
Intevac, Inc., 6.500%, 3/01/04 ..................... 150,000 128,625
-------------
Oil & Gas -- 0.1%
Houston Industries, Inc., 6.000%, 3/15/12 .......... 250,000 237,500
-------------
Publishing -- 0.3%
Scholastic Corp., 5.000%, 8/15/05 144A (c) ......... 600,000 551,250
-------------
Real Estate Investment Trusts -- 1.2%
Federal Realty Investors Trust, 5.250%, 10/28/03 1,750,000 1,636,250
Rockefeller Properties, Zero Coupon Bond, 12/31/00 650,000 505,375
Sizeler Property Investors, Inc., 8.000%, 7/15/03 250,000 248,750
-------------
2,390,375
-------------
Restaurants -- 1.2%
Boston Chicken, Inc., Zero Coupon Bond,
6/01/15 .......................................... 500,000 25,000
Boston Chicken, Inc., 4.500%, 2/01/04 .............. 750,000 116,250
Einstein/Noah Bagel Corp., 7.250%, 6/01/04 ......... 750,000 487,500
Shoney's, Inc., Zero Coupon Bond, 4/11/04 .......... 4,089,000 1,717,380
TPI Enterprises, Inc., 8.250%, 7/15/02 ............. 100,000 83,000
-------------
2,429,130
-------------
Telecommunications -- 0.1%
Broadband Technologies, Inc., 5.000%, 5/15/01 ...... 350,000 231,000
-------------
Textile & Apparel -- 0.2%
Dixie Yarns, Inc., 7.000%, 5/15/12 ................. USD 188,000 163,560
Fieldcrest Cannon, Inc., 6.000%, 3/15/12 ........... 220,000 192,500
-------------
356,060
-------------
TOTAL CONVERTIBLE BONDS
(Identified Cost $24,630,634) ..................... 21,231,468
-------------
TOTAL BONDS AND NOTES
(Identified Cost $191,663,664) .................... 193,665,279
-------------
<CAPTION>
Shares
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS -- 0.3% of Net Assets
Restaurants -- 0.3%
Advantica Restaurant Group, Inc. (g) ............... 67,479 657,920
-------------
TOTAL COMMON STOCKS
(Identified Cost $908,302) ........................ 657,920
-------------
PREFERRED STOCKS -- 1.8% of Net Assets
Building Materials -- 0.3%
Owens Corning, 6.500% 144A (c) ..................... 10,000 533,750
-------------
Chemicals -- Major -- 0.0%
E.I. du Pont DeNemours & Co., $3.50 ................ 300 20,775
-------------
Computers -- 0.2%
Unisys Corp., $3.75 ................................ 9,000 470,250
-------------
Financial Services -- 0.2%
Hvide Capital Trust 6.500% ......................... 10,000 427,500
-------------
Metals -- 0.0%
Aluminum Company of America, $3.75 ................. 100 7,463
-------------
Oil & Gas -- 0.1%
Chesapeake Energy Corp., 7.000%, 144A (c) .......... 5,000 213,750
-------------
Telecommunications -- 0.3%
Hyperion Telecommunications, Inc.,
12.875% PIK (f) .................................. 500 497,500
-------------
Utilities -- 0.7%
Arizona Public Service Co., $2.40 .................. 460 19,780
Cleco Corp., 4.750% ................................ 850 72,356
Del Marva Power & Light Co., 4.000% ................ 434 29,078
Entergy Louisiana, Inc., 4.440% .................... 830 58,930
Entergy New Orleans, Inc., 4.360% .................. 90 6,154
Entergy New Orleans, Inc., 4.750% .................. 2,876 210,667
Jersey Central Power & Light Co., 4.000% ........... 750 48,000
MDU Resources Group, Inc., 5.100% .................. 1,020 94,350
Nevada Power Co., 4.700% ........................... 11,600 224,750
Niagara Mohawk Power Corp., 3.600% ................. 200 11,725
Niagara Mohawk Power Corp., 3.900% ................. 100 6,500
Niagara Mohawk Power Corp., 4.400% ................. 5,000 282,500
Niagara Mohawk Power Corp., 4.850% ................. 2,850 228,000
Northern States Power Co., $4.11 ................... 100 7,850
Public Service Electric & Gas Co., 4.180% .......... 1,950 142,350
-------------
1,442,990
-------------
TOTAL PREFERRED STOCKS
(Identified Cost $3,085,039) ...................... 3,613,978
-------------
WARRANTS -- 0.0% of Net Assets
Computers -- 0.0%
Streamlogic Corp. expiring 10/7/01 (d) (g) ......... 250 0
-------------
TOTAL WARRANTS
(Identified Cost $0) .............................. 0
-------------
SHORT-TERM INVESTMENT -- 0.2% of Net Assets
Repurchase Agreement with State Street Bank and Trust
Co., dated 6/30/98 at 5.000% to be repurchased at
$469,065 on 7/01/98 collateralized by $365,000 U.S.
Treasury Bond, 8.125%, due 8/15/19 with a value of
$479,457 USD 469,000 469,000
-------------
TOTAL SHORT-TERM INVESTMENT
(Identified Cost $469,000) ........................ 469,000
-------------
TOTAL INVESTMENTS -- 98.2%
(IDENTIFIED COST $196,126,005) (h) ................ 198,406,177
Cash and Other Assets, Less Liabilities -- 1.8% ....... 3,555,196
-------------
NET ASSETS -- 100% .................................... 201,961,373
===========
</TABLE>
(a) See Note 1.
(b) Step Bond: Coupon is zero or below market rate for an initial period and
then increases at a specified date and rate.
(c) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(d) Company in Chapter 11 Bankruptcy.
(e) Security in default.
(f) All or a portion of income may be received as additional securities.
(g) Non-income producing security.
(h) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $196,126,005 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $13,521,540 and $11,241,368, respectively, resulting in
net unrealized appreciation of $2,280,172.
Key to Abbreviations:
AUD: Australian Dollar
CAD: Canadian Dollar
NZD: New Zealand Dollar
USD: United States Dollar
ZAR: South African Rand
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
LOOMIS SAYLES HIGH YIELD FIXED INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- -------------------------------------------------------------------------------------------------
BONDS AND NOTES -- 89.3% of Net Assets
<S> <C> <C>
NON-CONVERTIBLE BONDS -- 60.2%
Broadcasting -- 2.3%
CBS, Inc., 7.125%, 11/01/23 ............................. USD 500,000 $ 477,505
Fox Family Worldwide, Inc., Zero Coupon Bond, 11/01/07
(step to 10.250% on 11/01/02) (b) ...................... 400,000 260,000
------------
737,505
------------
Canadian -- 7.0%
Clearnet Communications, Inc., Zero Coupon Bond, 8/13/07
(step to 11.750% on 8/13/02) (b) ...................... CAD 2,000,000 898,295
International Semi-Tech Corp., Zero Coupon Bond, 8/15/03
(step to 11.500% on 8/15/00) (b) ...................... 1,750,000 525,000
Microcell Telecommunications, Inc., Zero Coupon Bond,
10/15/07 (step to 11.125% on 10/15/02) (b) ............ 710,000 304,400
Rogers Cablesystems Ltd., 9.650%, 1/15/14 ............... 200,000 156,972
Rogers Communications, Inc., 8.750%, 7/15/07 ............ 225,000 157,309
Rogers Communications, Inc., 8.875%, 7/15/07 ............ USD 250,000 251,875
------------
2,293,851
------------
Communications -- 3.3%
Arch Communications Group, Inc., Zero Coupon Bond,
3/15/08 (step to 10.875% on 3/15/01) (b) .............. 1,925,000 1,097,250
------------
Computers -- 2.1%
Apple Computer, Inc., 6.500%, 2/15/04 ................... 750,000 690,000
------------
Electronics -- 0.6%
Westinghouse Electric Corp., 7.875%, 9/01/23 ............ 200,000 205,554
------------
Food & Beverage -- 2.0%
Borden, Inc., 7.875%, 2/15/23 ........................... 670,000 659,133
------------
Foreign Government/Agency -- 11.0%
Republic of Brazil, 10.125%, 5/15/27 .................... 1,200,000 1,033,200
Republic of Brazil C Bond, 8.000%, 4/15/14 PIK (c) ...... 754,139 556,177
Republic of Ecuador, 6.625%, 2/27/15 PIK (c) (d) ........ 445,066 266,194
Republic of Peru, 3.250%, 3/07/17 (step to 3.750%
on 3/07/99) (b) ....................................... 1,500,000 888,750
Republic of Venezuela, 9.250%, 9/15/27 .................. 1,100,000 849,750
------------
3,594,071
------------
Foreign Issuer -- 22.9%
Bangko Sentral Pilipinas, 8.600%, 6/15/27 ............... 750,000 645,000
Bangkok Bank Public Co. Ltd., 8.250%, 3/15/16 144A (e) .. 250,000 187,153
Bangkok Bank Public Co. Ltd., 8.375%, 1/15/27 144A (e) .. 450,000 329,125
Export Import Bank of Korea, 6.375%, 2/15/06 ............ USD 700,000 526,121
Hyundai Motor Co. Ltd., 7.600%, 7/15/07 144A (e) ........ 500,000 389,060
Industrial Finance Corp. of Thailand, 7.375%, 1/14/07
144A (e) .............................................. 250,000 218,813
Korea Electric Power Corp., 7.400%, 4/01/16 ............. 442,806 355,037
Korea Electric Power Corp., 7.750%, 4/01/13 ............. 250,000 184,830
Murrin Murrin Holdings Property Ltd., 9.375%, 8/31/07 ... 150,000 147,000
Pan Pacific Industrial Investment Plc, Zero Coupon Bond,
4/28/07 144A (e) ...................................... 850,000 327,029
Petroleos Mexicanos, 9.500%, 9/15/27 .................... 500,000 470,750
Petroleos Mexicanos, Medium Term, 8.625%, 12/01/23 ...... 500,000 430,625
Philippine Long Distance Telephone Co., 8.350%, 3/06/17 . 250,000 213,142
Pindo Deli Finance Mauritius Ltd., 10.750%, 10/01/07 .... 450,000 315,000
Pindo Deli Finance Mauritius Ltd., 10.875%, 10/01/27 .... 750,000 442,500
Pycsa Panama SA, 10.280%, 12/15/12 144A (e) ............. 125,000 117,969
Quezon Power Philippines Co., 8.860%, 6/15/17 ........... 600,000 516,120
Samsung Electronics Co. Ltd., 8.500%, 11/01/02 144A (e) . 500,000 453,410
Siam Commercial Bank Public Co., 7.500%, 3/15/06
144A (e) .............................................. 525,000 431,224
Tjiwi Kimia Mauritius Ltd., 10.000%, 8/01/04 ............ 450,000 319,500
Total Access Communication Public Co. Ltd.,
7.625%, 11/04/01 144A (e) ............................. 375,000 285,000
Total Access Communication Public Co. Ltd.,
8.375%, 11/04/06 144A (e) ............................. 300,000 216,000
------------
7,520,408
------------
Oil & Gas -- 1.4%
Chesapeake Energy Corp., 7.875%, 3/15/04 ................ 275,000 257,813
Chesapeake Energy Corp., 9.625%, 5/01/05 144A (e) ....... 200,000 200,500
------------
458,313
------------
Retail -- General -- 1.9%
K Mart Pass Thru, 8.540%, 1/02/15 ....................... 157,294 163,443
Penn Traffic Co., 9.625%, 4/15/05 ....................... 1,175,000 455,312
------------
618,755
------------
Telecommunications -- 4.3%
Nextel Communications, Inc., Zero Coupon Bond, 10/31/07
(step to 9.750% on 10/31/02) (b) ...................... USD 750,000 489,375
Nextel International, Inc., Zero Coupon Bond, 4/15/08
(step to 12.125% on 4/15/03) 144A (b) (e) ............. 300,000 172,500
RCN Corp., Zero Coupon Bond, 2/15/08 (step to 9.800%
on 2/15/03) (b) ....................................... 500,000 300,000
RCN Corp., Zero Coupon Bond, 7/01/08 (step to 11.000%
on 7/01/03) (b) ....................................... 300,000 178,500
Teligent, Inc., Zero Coupon Bond, 3/01/08 (step to 11.500%
on 3/01/03) 144A (b) (e) .............................. 500,000 276,250
------------
1,416,625
------------
Textile & Apparel -- 1.4%
Phillips Van Heusen Corp., 7.750%, 11/15/23 ............. 500,000 464,285
------------
TOTAL NON-CONVERTIBLE BONDS
(Identified Cost $20,849,508).......................... 19,755,750
------------
CONVERTIBLE BONDS -- 29.1%
Auto & Related -- 1.1%
Exide Corp., 2.900%, 12/15/05 144A (e) .................. 600,000 370,500
------------
Canadian -- 1.3%
Rogers Communications, Inc., 2.000%, 11/26/05 ........... 700,000 434,000
------------
Commercial Services -- 0.0%
Molten Metal Technology, Inc., 5.500%, 5/01/06 (f) (g) .. 300,000 12,000
------------
Computers -- 1.7%
Apple Computer, Inc., 6.000%, 6/01/01 ................... 50,000 56,593
Cray Research, Inc., 6.125%, 2/01/11 .................... 250,000 203,750
Maxtor Corp., 5.750%, 3/01/12 ........................... 120,000 84,000
Read Rite Corp., 6.500%, 9/01/04 ........................ 350,000 220,500
------------
564,843
------------
Electronics -- 5.1%
Cirrus Logic, Inc., 6.000%, 12/15/03 144A (e) ........... 825,000 652,781
Integrated Device Technology, 5.500%, 6/01/02 ........... 50,000 40,250
Kent Electronics Corp., 4.500%, 9/01/04 ................. 350,000 286,125
Lam Research Corp., 5.000%, 9/01/02 ..................... 500,000 410,000
LTX Corp., 7.250%, 4/15/11 .............................. 50,000 29,875
Richardson Electronics Ltd., 7.250%, 12/15/06 ........... 100,000 96,000
Zenith Corp., 6.250%, 4/01/11 (f) ....................... 541,000 137,279
------------
1,652,310
------------
Environmental Services -- 1.0%
Air & Water Technologies Corp., 8.000%, 5/15/15 ......... USD 400,000 332,000
------------
Foreign Issuer -- 8.4%
Advanced Agro Public Co., 3.500%, 6/17/01 ............... 575,000 517,500
APP Finance VII Mauritius Ltd., 3.500%, 4/30/03 144A (e) 250,000 198,125
Bangkok Bank Public Co. Ltd., 3.250%, 3/03/04 ........... 575,000 186,875
Banpu Public Co., 2.750%, 4/10/03 ....................... 150,000 102,750
Burns, Philp, 5.500%, 4/30/04 ........................... 150,000 85,500
Empresas ICA Sociedad, 5.000%, 3/15/04 .................. 650,000 463,937
Loxley Public Co. Ltd., 2.500%, 4/04/01 ................. 350,000 112,000
Piltel, 1.750%, 7/17/06 ................................. 100,000 77,750
PT Indorayon, 7.000%, 5/02/06 ........................... 250,000 75,000
Samsung Electronics Co. Ltd., Zero Coupon Bond, 12/31/07 250,000 195,000
Sappi BVI Finance, 7.500%, 8/01/02 ...................... 300,000 279,750
Siam Commercial Bank Public Co., 3.250%, 1/24/04 ........ 950,000 323,000
Ssangyong Oil Refining Co., Inc., 3.000%, 12/31/04 ...... 100,000 47,000
Total Access Communication Public Co. Ltd.,
2.000%, 5/31/06 ....................................... 100,000 76,000
------------
2,740,187
------------
Freight Transportation -- 0.1%
Worldway Corp., 6.250%, 4/15/11 ........................ 50,000 41,500
------------
Health Care -- Drugs -- 2.3%
Dura Pharmaceuticals, Inc., 3.500%, 7/15/02 ............. 250,000 221,563
Glycomed, Inc., 7.500%, 1/01/03 ......................... 150,000 141,000
NABI, Inc., 6.500%, 2/01/03 ............................. 575,000 378,781
------------
741,344
------------
Health Care -- Services -- 1.1%
Medical Care International, Inc., 6.750%, 10/01/06 ...... 150,000 137,437
Physicians Resource Group, Inc., 6.000%, 12/01/01 144A (e) 50,000 39,438
Tenet Healthcare Corp., 6.000%, 12/01/05 ................ 200,000 170,500
------------
347,375
------------
Home Builders -- 0.9%
Schuler Homes, Inc., 6.500%, 1/15/03 .................... 325,000 292,500
------------
Machinery -- 0.3%
Intevac, Inc., 6.500%, 3/01/04 .......................... 100,000 85,750
------------
Metals -- 0.5%
Battle Mountain Gold Co., 6.000%, 1/04/05 ............... 200,000 162,000
------------
Restaurants -- 2.8%
Boston Chicken, Inc., Zero Coupon Bond, 6/01/15 ......... USD 1,000,000 50,000
Boston Chicken, Inc., 4.500%, 2/01/04 ................... 1,100,000 170,500
Einstein/Noah Bagel Corp., 7.250%, 6/01/04 .............. 125,000 81,250
Shoney's, Inc., Zero Coupon Bond, 4/11/04 ............... 1,200,000 504,000
TPI Enterprises, Inc., 8.250%, 7/15/02 .................. 150,000 124,500
------------
930,250
------------
Retail -- Specialty -- 1.3%
Bell Sports Corp., 4.250%, 11/15/00 ..................... 275,000 237,188
CML Group, Inc., 5.500%, 1/15/03 ........................ 145,000 89,900
Jacobson Stores, Inc., 6.750%, 12/15/11 ................. 100,000 86,125
------------
413,213
------------
Telecommunications -- 0.8%
Broadband Technologies, Inc., 5.000%, 5/15/01 ........... 415,000 273,900
------------
Textile & Apparel -- 0.4%
Converse, Inc., 7.000%, 6/01/04 ......................... 125,000 80,781
Dixie Yarns, Inc., 7.000%, 5/15/12 ...................... 61,000 53,070
------------
133,851
------------
TOTAL CONVERTIBLE BONDS
(Identified Cost $11,431,155) ......................... 9,527,523
------------
TOTAL BONDS AND NOTES
(Identified Cost $32,280,663) ......................... 29,283,273
------------
COMMON STOCKS -- 5.2% of Net Assets
Foreign Issuer -- 0.5%
Sappi Ltd., ADR (h) ...................................... 40,000 149,200
Siam Commercial Bank Public Co. (h) ...................... 52,000 16,655
------------
165,855
------------
Oil & Gas -- 0.5%
Chesapeake Energy Corp. (h) .............................. 45,025 180,100
------------
Real Estate Investment Trusts -- 1.3%
Associated Estates Realty Corp. .......................... 19,600 366,275
Berkshire Realty Co., Inc. ............................... 4,500 52,593
------------
418,868
------------
Restaurants -- 0.5%
Advantica Restaurant Group, Inc. (h) ..................... 15,745 153,514
------------
Utilities -- 2.4%
Eastern Utilities Associates ............................. 29,800 782,250
------------
TOTAL COMMON STOCKS (Identified Cost $1,804,544)......... 1,700,587
------------
PREFERRED STOCKS -- 3.6% of Net Assets
Financial Services -- 0.7%
Hvide Capital Trust 6.500% ............................... 5,500 235,125
------------
Foreign Issuer -- 0.9%
Philippine Long Distance Telephone Co., $3.50, GDS ....... 6,200 285,200
------------
Metals -- 1.2%
Bethlehem Steel Corp., $3.50 144A (e) .................... 9,000 410,625
------------
Oil & Gas -- 0.1%
Kelley Oil & Gas, $2.625 ................................. 750 17,531
------------
Telecommunications -- 0.0%
Hyperion Telecommunications, Inc., PIK 12.875% (c) ....... 16 15,920
------------
Utilities -- 0.7%
Central Maine Power Co., 3.500% .......................... 785 43,372
Niagara Mohawk Power Corp., 3.600% ....................... 1,560 91,455
Niagara Mohawk Power Corp., 4.100% ....................... 700 46,725
Niagara Mohawk Power Corp., 4.400% ....................... 850 48,025
------------
229,577
------------
TOTAL PREFERRED STOCKS
(Identified Cost $1,082,602)........................... 1,193,978
------------
TOTAL INVESTMENTS -- 98.1%
(IDENTIFIED COST $35,167,809) (i) ....................... 32,177,838
Cash and Other Assets, Less Liabilities -- 1.9%.............. 609,377
------------
NET ASSETS -- 100% .......................................... 32,787,215
==========
</TABLE>
(a) See Note 1.
(b) Step Bond: Coupon is zero or below market rate for an initial period and
then increases at a specified date and rate.
(c) All or a portion of income may be received as additional securities.
(d) Floating Rate Bond: Coupon is six month London Interbank Offered Rate
(LIBOR) plus .8125%.
(e) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(f) Company in Chapter 11 Bankruptcy.
(g) Security in default.
(h) Non-income producing security.
(i) At June 30, 1998, the net unrealized depreciation on investments based on
cost of $35,167,809 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $1,075,597 and $4,065,568, respectively, resulting in net
unrealized depreciation of $2,989,971.
Key to Abbreviations:
ADR: American Depositary Receipt
CAD: Canadian Dollar
GDS: Global Depositary Shares
USD: United States Dollar
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
LOOMIS SAYLES INTERMEDIATE DURATION
FIXED INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- -------------------------------------------------------------------------------------------------
BONDS AND NOTES -- 97.1% of Net Assets
<S> <C> <C>
NON-CONVERTIBLE BONDS -- 97.1%
Banks/Savings & Loans -- 5.8%
BankAmerica Corp., 7.200%, 4/15/06 ......................... $ 50,000 $ 52,826
Capital One Bank, 6.375%, 2/15/03 .......................... 590,000 590,531
------------
643,357
------------
Financial Services -- 15.0%
Asset Securitization Corp., 7.010%, 10/13/26 ............... 459,100 468,264
Associates Manufactured Housing, 6.275%, 3/15/28 ........... 450,000 453,483
Commercial Credit Co., 6.500%, 6/01/05 ..................... 50,000 50,738
EQCC Home Equity Loan Trust, 5.150%, 9/15/08 ............... 140,073 136,785
Ford Motor Credit Co., 7.500%, 1/15/03 ..................... 50,000 52,633
Nomura Asset Securities Corp., 6.280%, 3/17/28 ............. 492,199 497,062
------------
1,658,965
------------
Foreign Government/Agency -- 9.6%
Government of Poland, 4.000%, 10/27/14 (step to 5.000% on 10/
27/98) (b) ............................................... 575,000 513,935
Republic of South Africa, 8.375%, 10/17/06 ................. 550,000 555,780
------------
1,069,715
------------
Foreign Issuer -- 6.8%
Perez Companc SA, 8.125%, 7/15/07 144A (c) ................. 525,000 479,063
Tenaga Nasional Berhad, 7.625%, 4/29/07 144A (c) ........... 325,000 278,801
------------
757,864
------------
Government Agencies -- 0.7%
Federal National Mortgage Association, 6.500%, 2/01/11 ..... 77,847 78,382
------------
Oil & Gas -- 7.5%
Pioneer Natural Resources Co., 6.500%, 1/15/08 ............. 400,000 387,700
R&B Falcon Corp., 6.500%, 4/15/03 144A (c) ................. 450,000 447,822
------------
835,522
------------
Real Estate Investment Trusts -- 18.9%
American Health Properties, Inc., 7.050%, 1/15/02 .......... 525,000 536,387
Highwoods/Forsyth Ltd., 6.750%, 12/01/03 ................... 500,000 500,295
Oasis Residential, Inc., 6.750%, 11/15/01 .................. 500,000 507,600
Trinet Corporate Realty Trust, Inc., 6.750%, 3/01/03 ....... 550,000 550,561
------------
2,094,843
------------
Securities -- 5.4%
Lehman Brothers Holdings, Inc., 7.125%, 9/15/03 ............ 575,000 595,551
------------
Telecommunications -- 4.9%
TCI Communications, Inc., 6.875%, 2/15/06 .................. 525,000 541,564
------------
Textile & Apparel -- 1.8%
Tommy Hilfiger Corp., 6.500%, 6/01/03 ...................... 200,000 199,824
------------
Tobacco -- 4.7%
RJR Nabisco, Inc., 7.625%, 9/15/03 ......................... 525,000 521,981
------------
Trucking & Leasing -- 3.3%
Amerco, 7.490%, 9/18/01 .................................... 350,000 361,753
------------
U.S. Government -- 7.3%
U.S. Treasury Notes, 5.625%, 12/31/02 ...................... 700,000 703,059
U.S. Treasury Notes, 5.875%, 2/15/04 ....................... 75,000 76,383
U.S. Treasury Notes, 6.000%, 10/15/99 ...................... 25,000 25,140
------------
804,582
------------
Utilities -- 5.4%
Enersis SA, 6.900%, 12/01/06 ............................... 50,000 47,129
KN Energy, Inc., 6.450%, 3/01/03 ........................... 550,000 550,583
------------
597,712
------------
TOTAL NON-CONVERTIBLE BONDS
(Identified Cost $10,759,637)............................ 10,761,615
------------
TOTAL BONDS AND NOTES (Identified Cost $10,759,637)........ 10,761,615
------------
SHORT-TERM INVESTMENT -- 1.3% of Net Assets
Repurchase Agreement with State Street Bank and Trust Co.,
dated 6/30/98 at 5.000% to be repurchased at $145,020 on
7/01/98 collateralized by $130,000 U.S. Treasury Bond,
6.750%, due 8/15/26 with a value of $151,087 .............. 145,000 145,000
------------
TOTAL SHORT-TERM INVESTMENT
(Identified Cost $145,000)............................... 145,000
------------
TOTAL INVESTMENTS -- 98.4%
(IDENTIFIED COST $10,904,637) }D{ ......................... 10,906,615
Cash and Other Assets, Less Liabilities -- 1.6%................ 172,373
------------
NET ASSETS -- 100% ............................................ $ 11,078,988
============
</TABLE>
(a) See Note 1.
(b) Step Bond: Coupon is zero or below market rate for an initial period and
then increases at a specified date and rate.
(c) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(d) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $10,904,637 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $60,295 and $58,317, respectively, resulting in net
unrealized appreciation of $1,978.
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
LOOMIS SAYLES INVESTMENT GRADE FIXED INCOME FUND
Portfolio of Investments -- as of June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
Face
Amount Value (a)
- --------------------------------------------------------------------------------------------------
BONDS AND NOTES -- 96.2% of Net Assets
<S> <C> <C>
NON-CONVERTIBLE BONDS -- 89.8%
Banks/Savings & Loans -- 1.5%
First Union Institutional Trust, 7.850%, 1/01/27 ... USD 1,000,000 $ 1,062,180
First Union Institutional Trust, 8.040%, 12/01/26 500,000 542,742
------------
1,604,922
------------
Canadian -- 18.8%
Canadian Government, Zero Coupon Bond,
6/01/21 .......................................... CAD 750,000 143,967
Canadian Government, Zero Coupon Bond,
6/01/25 .......................................... 29,050,000 4,556,824
Hydro Quebec, Zero Coupon Bond, 8/15/20 ............ 7,500,000 1,342,339
MacMillan Bloedel, 7.700%, 2/15/26 ................. USD 305,000 306,403
Milit Air, Inc., 5.750%, 6/30/19 144A (b) .......... CAD 1,800,000 1,226,541
New Brunswick FM Project, Zero Coupon Bond, 11/30/27
(step to 6.470% on 5/30/03) 144A (b) (c) ........ 500,000 263,163
Ontario Hydro, 8.900%, 8/18/22 ..................... 1,175,000 1,114,029
Province of Alberta, 5.930%, 9/16/16 ............... 728,374 511,044
Province of British Columbia, Zero Coupon Bond, 8/23/13 5,000,000 1,420,940
Province of British Columbia, Zero Coupon Bond, 6/09/14 1,000,000 270,782
Province of British Columbia, Zero Coupon Bond, 9/05/20 3,300,000 607,023
Province of British Columbia, Zero Coupon Bond, 6/09/22 4,000,000 663,377
Province of British Columbia, Zero Coupon Bond, 8/19/22 4,195,000 687,724
Province of British Columbia, Zero Coupon Bond,
11/19/27 ......................................... 6,500,000 771,003
Province of British Columbia, 8.000%, 9/08/23 ...... 750,000 654,576
Province of Manitoba, 6.500%, 9/22/17 .............. 1,825,000 1,357,464
Province of Manitoba, 7.750%, 12/22/25 ............. 3,100,000 2,688,790
Province of Newfoundland, 6.150%, 4/17/28 .......... 500,000 348,600
Province of Saskatchewan, Zero Coupon Bond, 4/10/14.. 2,500,000 683,589
Province of Saskatchewan, 8.750%, 5/30/25 .......... 1,250,000 1,187,519
------------
20,805,697
------------
Communications -- 0.3%
Arch Communications Group, Inc., Zero Coupon Bond, 3/
15/08 (step to 10.875% on
3/15/01) (c) ..................................... USD 575,000 327,750
------------
Computers -- 4.6%
Seagate Technology, Inc., 7.370%, 3/01/07 .......... 2,000,000 1,977,860
Seagate Technology, Inc., 7.450%, 3/01/37 .......... 3,000,000 2,946,930
Seagate Technology, Inc., 7.875%, 3/01/17 .......... 200,000 193,370
Streamlogic Corp., 14.000%, 10/07/98 (d) (e) ....... 5,440 272
------------
5,118,432
------------
Electronics -- 0.2%
Pioneer Standard Electronics, Inc.,
8.500%, 8/01/06 .................................. 250,000 268,899
------------
Entertainment -- 4.7%
Time Warner Entertainment Co., 6.875%, 6/15/18 410,000 411,599
Time Warner Entertainment Co., 6.950%, 1/15/28 2,250,000 2,256,435
Time Warner Entertainment Co., 7.570%, 2/01/24 2,300,000 2,473,926
------------
5,141,960
------------
Foreign Government/Agency -- 5.7%
New South Wales Treasury, Zero Coupon Bond, 11/23/20
................................................... AUD 6,000,000 990,530
Republic of Brazil C Bond, 8.000%, 4/15/14
PIK (f) .......................................... USD 2,900,536 2,139,145
Republic of South Africa, 8.500%, 6/23/17 .......... 1,125,000 1,071,878
Republic of South Africa, 12.000%, 2/28/05 ......... ZAR 4,250,000 614,836
Republic of South Africa, 12.500%, 12/21/06 ........ 8,600,000 1,244,681
Republic of South Africa, 13.000%, 8/31/10 ......... USD 1,500,000 219,756
------------
6,280,826
------------
Foreign Issuer -- 10.0%
Bangkok Bank Public Co. Ltd., 8.375%,
1/15/27 144A (b) ................................. 2,250,000 1,645,628
Hyundai Motor Co. Ltd., 7.600%, 7/15/07 144A (b) ... 100,000 77,812
Industrial Finance Corp. of Thailand,
6.875%, 4/01/03 144A (b) ......................... 575,000 515,654
Korea Electric Power Corp., 7.400%, 4/01/16 ........ 476,135 381,760
Pan Pacific Industrial Investment Plc, Zero Coupon
Bond, 4/28/07 144A (b) ........................... 825,000 317,411
PDVSA Finance Ltd., 7.500%, 11/15/28 144A (b) 1,000,000 1,029,170
Perez Companc SA, 8.125%, 7/15/07 144A (b) ......... USD 350,000 319,375
Pindo Deli Finance Mauritius Ltd.,
10.875%, 10/01/27 ................................ 100,000 59,000
Samsung Electronics Co. Ltd., 7.700%, 10/01/27 144A(b) 1,250,000 812,500
Tata Electric Co., 8.500%, 8/19/17 144A (b) ........ 1,500,000 1,260,000
Telekom Malaysia Berhad, 7.875%, 8/01/25 144A (b) .. 1,750,000 1,409,450
Tenaga Nasional Berhad, 7.500%, 11/01/25 144A (b) .. 4,140,000 3,092,828
Total Access Communication Public Co. Ltd., 8.375%,
11/04/06 144A (b) ................................ 150,000 108,000
------------
11,028,588
------------
Freight Transportation -- 3.7%
Atlas Air, Inc., 7.680%, 1/02/14 144A (b) .......... 4,000,000 4,054,560
------------
Government Agencies -- 3.4%
Federal Home Loan Mortgage Corp., 6.000%, 4/15/28 .. 1,000,000 952,180
Federal National Mortgage Association, Zero Coupon
Bond, 10/29/07 ................................... NZD 6,850,000 1,925,716
Federal National Mortgage Association,
6.000%, 11/25/08 PIK (f) ......................... USD 962,107 931,733
------------
3,809,629
------------
Health Care -- Services -- 0.6%
Columbia/HCA Healthcare Corp., 7.050%, 12/01/27 .... 800,000 716,616
------------
Home Builders -- 2.7%
Pulte Corp., 7.000%, 12/15/03 ...................... 188,000 190,461
Pulte Corp., 7.300%, 10/24/05 ...................... 200,000 203,868
Pulte Corp., 7.625%, 10/15/17 ...................... 2,500,000 2,629,850
------------
3,024,179
------------
Oil & Gas -- 5.1%
Mitchell Energy & Development Corp., 6.750%, 2/15/04 300,000 298,758
Pioneer Natural Resources Co., 7.200%, 1/15/28 1,000,000 972,840
R&B Falcon Corp., 7.375%, 4/15/18 144A (b) ......... 2,750,000 2,800,792
Seagull Energy Corp., 7.500%, 9/15/27 .............. 1,600,000 1,595,264
------------
5,667,654
------------
Paper Products -- 0.7%
Mead Corp., 7.125%, 8/01/25 ........................ USD 250,000 251,515
Westvaco Corp., 7.000%, 8/15/23 .................... 500,000 498,555
------------
750,070
------------
Real Estate Investment Trusts -- 6.0%
AMB Property Corp., 7.500%, 6/30/18 ................ 1,000,000 1,004,820
Camden Property Trust, 7.000%, 11/15/06 ............ 500,000 502,315
First Industrial, 7.500%, 12/01/17 ................. 2,500,000 2,550,915
Highwoods Forsyth LP, 7.500%, 4/15/18 .............. 1,000,000 1,019,760
Security Capital Group, Inc., 7.700%, 6/15/28 144A
(b) ............................................... 1,000,000 1,011,700
Trinet Corporate Realty Trust, 7.700%, 7/15/17 ..... 500,000 519,655
------------
6,609,165
------------
Retail -- General -- 0.5%
Woolworth Corp., 8.500%, 1/15/22 ................... 500,000 551,485
------------
Supranational -- 3.2%
International Bank for Reconstruction & Development,
Zero Coupon Bond, 8/20/07 ........................ NZD 9,650,000 2,691,816
International Bank for Reconstruction & Development,
8.000%, 5/23/07 .................................. 1,505,000 830,242
------------
3,522,058
------------
Taxable Municipal -- 0.7%
Orange County, California Pension Obligation, Zero
Coupon Bond, 9/01/16 ............................. USD 2,500,000 720,175
------------
Telecommunications -- 4.1%
TCI Communications, Inc., 7.125%, 2/15/28 .......... 975,000 1,017,900
TCI Communications, Inc., 7.875%, 8/01/13 .......... 100,000 111,603
TCI Communications, Inc., 7.875%, 2/15/26 .......... 2,970,000 3,376,177
------------
4,505,680
------------
Textile & Apparel -- 1.6%
Burlington Industries, Inc., 7.250%, 8/01/27 ....... 250,000 257,910
Fruit of the Loom, Inc., 7.375%, 11/15/23 .......... 550,000 497,816
Kellwood Co., 7.625%, 10/15/17 ..................... 1,000,000 1,059,530
------------
1,815,256
------------
Tobacco -- 5.2%
Loews Corp., 7.000%, 10/15/23 ...................... USD 250,000 242,098
Philip Morris Cos., Inc., 7.750%, 1/15/27 .......... 2,850,000 3,048,531
RJR Nabisco, Inc., 7.625%, 9/15/03 ................. 500,000 497,125
RJR Nabisco, Inc., 8.750%, 8/15/05 ................. 150,000 156,430
RJR Nabisco, Inc., 9.250%, 8/15/13 ................. 1,650,000 1,779,789
------------
5,723,973
------------
Transportation -- 0.4%
American President Cos. Ltd., 7.125%, 11/15/03 500,000 403,730
American President Cos. Ltd., 8.000%, 1/15/24 ...... 100,000 70,562
------------
474,292
------------
U.S. Government -- 2.9%
U.S. Treasury Bonds, 6.000%, 2/15/26 ............... 2,450,000 2,548,759
U.S. Treasury Strips, Zero Coupon Bond, 8/15/20 2,500,000 707,150
------------
3,255,909
------------
Utilities -- 3.2%
Boston Edison Co., 7.800%, 3/15/23 ................. 250,000 264,995
Comed Financing II, 8.500%, 1/15/27 ................ 1,000,000 1,070,580
Commonwealth Edison Co., 4.750%, 12/01/11 .......... 135,000 113,572
KN Capital Trust, 7.630%, 4/15/28 .................. 2,000,000 2,049,160
------------
3,498,307
------------
TOTAL NON-CONVERTIBLE BONDS
(Identified Cost $96,443,370) ..................... 99,276,082
------------
CONVERTIBLE BONDS -- 6.4%
Chemicals -- Major -- 0.1%
FMC Corp., 6.750%, 1/16/05 ......................... 170,000 159,800
------------
Computers -- 0.1%
Maxtor Corp., 5.750%, 3/01/12 ...................... 150,000 105,000
------------
Diversified Operations -- 0.5%
Ogden Corp., 5.750%, 10/20/02 ...................... 600,000 589,500
------------
Electronics -- 0.1%
Lam Research Corp., 5.000%, 9/01/02 ................ 100,000 82,000
Richardson Electronics Ltd., 7.250%, 12/15/06 ...... 50,000 48,000
Zenith Corp., 6.250%, 4/01/11 (d) .................. 71,000 18,016
------------
148,016
------------
Environmental Services -- 1.3%
Thermo TerraTech, Inc., 4.625%, 5/01/03
144A (b) ......................................... USD 1,650,000 1,478,812
------------
Foreign Issuer -- 2.2%
Bangkok Bank Public Co. Ltd., 3.250%, 3/03/04 400,000 130,000
Banpu Public Co., 2.750%, 4/10/03 .................. 500,000 342,500
Burns, Philp, 5.500%, 4/30/04 ...................... 590,000 336,300
Empresas ICA Sociedad, 5.000%, 3/15/04 ............. 100,000 71,375
Loxley Public Co. Ltd., 2.500%, 4/04/01 ............ 1,150,000 368,000
Samsung Corp., 0.250%, 6/26/06 ..................... 245,000 225,400
Samsung Display Devices, 0.250%, 3/12/06 ........... 260,000 245,700
Siam Commercial Bank Public Co.,
3.250%, 1/24/04 .................................. 100,000 34,000
Ssangyong Oil Refining Co., Inc.,
3.000%, 12/31/04 ................................. 100,000 47,000
Telekom Malaysia Berhad, 4.000%, 10/03/04 .......... 800,000 584,000
------------
2,384,275
------------
Freight Transportation -- 0.2%
Builders Transportation, Inc., 6.500%, 5/01/11(d) (e) 129,000 12,900
Worldway Corp., 6.250%, 4/15/11 .................... 250,000 207,500
------------
220,400
------------
Health Care -- Drugs -- 0.1%
NABI, Inc., 6.500%, 2/01/03 ........................ 100,000 65,875
------------
Machinery -- 0.1%
Intevac, Inc., 6.500%, 3/01/04 ..................... 100,000 85,750
------------
Oil & Gas -- 0.3%
Houston Industries, Inc., 6.000%, 3/15/12 .......... 335,000 318,250
------------
Publishing -- 0.5%
Scholastic Corp., 5.000%, 8/15/05 144A (b) ......... 540,000 496,125
------------
Real Estate Investment Trusts -- 0.7%
Federal Realty Investors Trust, 5.250%, 10/28/03 .... 835,000 780,725
------------
Restaurants -- 0.2%
Shoney's, Inc., Zero Coupon Bond, 4/11/04 .......... USD 525,000 220,500
------------
Retail -- Specialty -- 0.0%
CML Group, Inc., 5.500%, 1/15/03 ................... 50,000 31,000
------------
TOTAL CONVERTIBLE BONDS
(Identified Cost $8,567,619) ...................... 7,084,028
------------
TOTAL BONDS AND NOTES
(Identified Cost $105,010,989) .................... 106,360,110
------------
<CAPTION>
Shares
- -------------------------------------------------------------------------------------------------
PREFERRED STOCKS -- 1.4% of Net Assets
Chemicals -- Major -- 0.1%
<S> <C> <C>
E.I. du Pont DeNemours & Co., $3.50 ................ 2,200 152,350
------------
Metals -- 0.2%
Aluminum Co. of America, $3.75 ..................... 3,350 249,994
------------
Utilities -- 1.1%
Arizona Public Service Co., $2.36 .................. 246 10,435
Arizona Public Service Co., $2.40 .................. 263 11,309
Cleco Corp., 4.750% ................................ 850 72,356
Connecticut Light & Power Co., $2.00 ............... 8,895 217,927
Connecticut Light & Power Co., $2.20 ............... 263 6,970
Dayton Power & Light Co., 3.750% ................... 701 43,462
Del Marva Power & Light Co., 4.000% ................ 350 23,450
Illinois Power Co., 4.080% ......................... 400 15,050
Illinois Power Co., 4.200% ......................... 100 3,967
Jersey Central Power & Light Co., 4.000% ........... 3,510 224,640
MDU Resources Group, Inc., 5.100% .................. 1,020 94,350
Northern Indiana Public Service Co., 4.250% ........ 2,110 145,590
Northern States Power Co., $4.08 ................... 50 3,763
Northern States Power Co., $4.10 ................... 100 7,500
Public Service Electric & Gas Co., 4.080% .......... 300 22,050
San Diego Gas & Electric Co., 4.500% ............... 100 1,663
Southern California Edison Co., 4.240% ............. 5,700 112,931
Southern California Edison Co., 4.320% ............. 8,080 149,480
------------
1,166,893
------------
TOTAL PREFERRED STOCKS
(Identified Cost $1,331,965) ...................... 1,569,237
------------
WARRANTS -- 0.0% of Net Assets
Computers -- 0.0%
Streamlogic Corp., Expiring 10/7/01 (d) (g) ........ 48 0
------------
TOTAL WARRANTS (Identified Cost $0) ................. 0
------------
<CAPTION>
Face
Amount
- -------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENT -- 0.2% of Net Assets
Repurchase Agreement with State Street Bank and Trust
Co., dated 6/30/98 at 5.000% to be repurchased at
$183,025 on 7/01/98 collateralized by $145,000 U.S.
Treasury Bond 8.125% due 8/15/19 with a value of
<S> <C> <C>
$190,469 .......................................... USD 183,000 183,000
------------
TOTAL SHORT-TERM INVESTMENT
(Identified Cost $183,000) ........................ 183,000
------------
TOTAL INVESTMENTS -- 97.8%
(IDENTIFIED COST $106,525,954) (h) ................ 108,112,347
Cash and Other Assets, Less Liabilities -- 2.2% ....... 2,423,787
------------
NET ASSETS -- 100% .................................... $110,536,134
============
</TABLE>
(a) See Note 1.
(b) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(c) Step Bond: Coupon is zero or below market rate for an initial period and
then increases at a specified date and rate.
(d) Company in Chapter 11 Bankruptcy.
(e) Security in default.
(f) All or a portion of income may be received as additional securities.
(g) Non-income producing security.
(h) At June 30, 1998, the net unrealized appreciation on investments based on
cost of $106,525,954 for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation for all securities in which there
is an excess of value over tax cost and aggregate gross unrealized
depreciation for all securities in which there is an excess of tax cost
over value were $6,286,745 and $4,700,352, respectively, resulting in net
unrealized appreciation of $1,586,393.
Key to Abbreviations:
AUD: Australian Dollar
CAD: Canadian Dollar
NZD: New Zealand Dollar
USD: United States Dollar
ZAR: South African Rand
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
California Tax- Core
Free Income Fixed Income
Fund Fund
------------- -----------
ASSETS
<S> <C> <C>
Investments at value .................................. $ 17,133,020 $18,470,238
Cash .................................................. 597 61,190
Receivable for:
Fund Shares sold .................................... 0 0
Securities sold ..................................... 0 72,640
Dividend and interest -- net ........................ 261,941 362,887
Foreign tax reclaim ................................. 0 0
Due from the adviser (Note 3) ......................... 34,552 31,504
Other assets (Note 1I) ................................ 0 6,767
------------- -----------
17,430,110 19,005,226
------------- -----------
LIABILITIES
Payable for:
Securities purchased ................................ 0 98,288
Fund Shares redeemed ................................ 0 0
Foreign taxes ....................................... 0 0
Custodian bank ...................................... 0 0
Accrued expenses:
Management fees (Note 3) ............................ 21,402 23,852
Trustee's fees (Note 3A) ............................ 308 308
Administrative fees ................................. 721 774
Other expenses ...................................... 9,533 9,798
------------- -----------
31,964 133,020
------------- -----------
NET ASSETS .............................................. $ 17,398,146 $18,872,206
============= ===========
Net Assets consist of:
Capital paid in ..................................... 16,870,519 17,870,749
Undistributed net investment income ................. 3,027 548,929
Accumulated net realized gain (loss) ................ 2,863 107,842
Unrealized appreciation (depreciation) on investments
and foreign currency -- net ....................... 521,737 344,686
------------- -----------
NET ASSETS .............................................. $ 17,398,146 $18,872,206
============= ===========
Shares of beneficial interest outstanding, no par value . 1,671,066 1,706,593
============= ===========
Computation of offering price:
Net asset value and redemption price per share
(Net assets/shares of beneficial interest outstanding) $ $ 10.41 $ 11.06
============= ===========
Identified cost of investments .......................... $ 16,611,283 $18,125,552
============= ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- --------------------------------------------------------------------------------
Intermediate
Core Fixed High Yield Duration Investment Grade
Growth Income Fixed Income Fixed Income Fixed Income
Fund Fund Fund Fund Fund
- ------------ ------------ ------------ ------------ ------------
$ 22,061,120 $198,406,177 $ 32,177,838 $ 10,906,615 $108,112,347
867 678 0 868 861
0 215,727 0 0 796,164
0 6,317,911 321,357 0 94,206
17,433 3,256,309 583,211 180,877 1,816,364
664 0 0 0 0
33,632 14,366 29,769 17,489 23,785
0 0 0 0 0
- ------------ ------------ ------------ ------------ ------------
22,113,716 208,211,168 33,112,175 11,105,849 110,843,727
- ------------ ------------ ------------ ------------ ------------
0 118,384 175,464 0 179,289
0 5,853,736 0 0 3,534
226 0 957 0 0
0 0 88,133 0 0
29,706 247,036 50,698 10,992 106,670
308 308 308 258 308
873 8,569 1,397 1,007 4,670
7,108 21,762 8,003 14,604 13,122
- ------------ ------------ ------------ ------------ ------------
38,221 6,249,795 324,960 26,861 307,593
- ------------ ------------ ------------ ------------ ------------
$ 22,075,495 $201,961,373 $ 32,787,215 $ 11,078,988 $110,536,134
============ ============ ============ ============ ============
12,842,157 188,653,926 33,126,156 11,071,862 107,577,825
120,005 6,590,335 1,683,043 58,607 70,376
5,892,184 4,452,795 968,259 (53,459) 1,310,174
3,221,149 2,264,317 (2,990,243) 1,978 1,577,759
- ------------ ------------ ------------ ------------ ------------
$ 22,075,495 $201,961,373 $ 32,787,215 $ 11,078,988 $110,536,134
============ ============ ============ ============ ============
1,538,436 15,404,176 3,230,514 1,107,058 9,143,558
============ ============ ============ ============ ============
$ 14.35 $ 13.11 $ 10.15 $ 10.01 $ 12.09
============ ============ ============ ============ ============
$ 18,839,971 $196,126,005 $ 35,167,809 $ 10,904,637 $106,525,954
============ ============ ============ ============ ============
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
For the Six Months Ended June 30, 1998 (unaudited)
<TABLE>
<CAPTION>
California Tax- Core
Free Income Fixed Income
Fund Fund
------------- -----------
<S> <C> <C>
INVESTMENT INCOME
Dividends* ............................................ $ 0 $ 0
Interest .............................................. 445,501 607,482
---------- ----------
445,501 607,482
---------- ----------
Expenses
Management fees (Note 3) ............................ 42,355 45,036
Trustee's fees and expenses (Note 3A) ............... 621 621
Administrative fees ................................. 3,855 4,430
Custodian and accounting fees ....................... 23,861 23,881
Transfer agent fees ................................. 11,023 6,954
Audit and tax services fees ......................... 5,527 5,347
Legal fees .......................................... 1,620 1,620
Printing fees ....................................... 797 823
Registration fees ................................... 7,600 12,732
Amortization of organization expenses (Note 1I) ..... 0 1,198
Miscellaneous ....................................... 855 796
---------- ----------
Total expenses ...................................... 98,114 103,438
Less expenses waived and reimbursed by the investment
adviser (Note 3) .................................. (43,052) (44,885)
---------- ----------
Net expenses ........................................ 55,062 58,553
---------- ----------
Net investment income ................................. 390,439 548,929
---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on investments and foreign
currency .......................................... 15,232 108,129
Change in unrealized appreciation (depreciation) on
investments and foreign currency .................. (19,217) (1,487)
---------- ----------
Net realized gain (loss) and change in unrealized
appreciation (depreciation) ....................... (3,985) 106,642
---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS ... $ $386,454 $ $655,571
========== ==========
* Net of foreign withholding taxes of $2,834 and $1,915 for Core Growth and High Yield Fixed Income
Funds, respectively.
</TABLE>
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- ------------------------------------------------------------------------------
Intermediate
Core Fixed High Yield Duration Investment Grade
Growth Income Fixed Income Fixed Income Fixed Income
Fund Fund Fund Fund Fund
- ----------- ----------- ----------- ----------- -----------
$ 166,263 $ 104,510 $ 105,839 $ 0 $ 45,727
51,853 7,098,952 1,701,566 308,709 3,452,738
- ----------- ----------- ----------- ----------- -----------
218,116 7,203,462 1,807,405 308,709 3,498,465
- ----------- ----------- ----------- ----------- -----------
75,471 465,240 100,065 18,775 191,416
620 621 621 570 621
6,539 43,754 7,474 2,679 22,339
21,572 54,420 29,071 16,415 39,238
5,236 10,733 5,006 2,852 7,149
5,725 6,967 5,546 5,027 6,073
1,620 1,620 1,620 2,054 1,620
1,668 8,445 1,572 363 4,173
9,326 23,145 10,926 7,653 13,627
0 0 0 0 0
883 883 868 685 883
- ----------- ----------- ----------- ----------- -----------
128,660 615,828 162,769 57,073 287,139
(30,549) (11,016) (37,703) (31,086) (23,943)
- ----------- ----------- ----------- ----------- -----------
98,111 604,812 125,066 25,987 263,196
- ----------- ----------- ----------- ----------- -----------
120,005 6,598,650 1,682,339 282,722 3,235,269
- ----------- ----------- ----------- ----------- -----------
5,915,109 3,178,801 688,496 (53,459) 948,858
(315,963) (2,507,317) (1,986,886) 1,978 (805,237)
- ----------- ----------- ----------- ----------- -----------
5,599,146 671,484 (1,298,390) (51,481) 143,621
- ----------- ----------- ----------- ----------- -----------
$ 5,719,151 $ 7,270,134 $ 383,949 $ 231,241 $ 3,378,890
=========== =========== =========== =========== ===========
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
California Tax-Free Income Fund
-------------------------------
Six Months
Ended Year Ended
June 30, December 31,
1998 1997
------------ ----------------
(unaudited)
FROM OPERATIONS
Net investment income ..................... $ 390,439 $ 716,797
Net realized gain (loss) on investments and
foreign currency ........................ 15,232 20,418
Change in unrealized appreciation
(depreciation) on investments and foreign
currency ................................ (19,217) 367,627
----------- -----------
Increase (decrease) in net assets from
operations .............................. 386,454 1,104,842
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income ..................... (393,820) (719,537)
Net realized gain on investments .......... 0 (41,370)
----------- -----------
Total distributions ..................... (393,820) (760,907)
----------- -----------
FROM CAPITAL SHARES TRANSACTIONS
Proceeds from the sale of shares .......... 796,000 3,727,583
Net asset value of shares issued in
connection with the reinvestment of
distributions ........................... 69,729 127,165
Cost of shares redeemed ................... (282,000) (836,438)
----------- -----------
Increase (decrease) in net assets derived
from capital share transactions ......... 583,729 3,018,310
----------- -----------
Total increase (decrease) in net assets . 576,363 3,362,245
NET ASSETS
Beginning of period ....................... 16,821,783 13,459,538
----------- -----------
End of period ............................. $17,398,146 $16,821,783
=========== ===========
UNDISTRIBUTED NET INVESTMENT INCOME
Beginning of period ....................... $ 6,408 $ 9,074
=========== ===========
End of period ............................. $ 3,027 $ 6,408
=========== ===========
NUMBER OF SHARES OF THE FUND:
Issued from the sale of shares ............ 76,168 364,171
Issued in connection with the reinvestment
of distributions ........................ 6,701 12,386
Redeemed .................................. (27,025) (82,667)
----------- -----------
Net change ................................ 55,844 293,890
=========== ===========
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- ------------------------------------------------------------------------------
Core Fixed Income Fund Core Growth Fund
- ------------------------------------- -------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, December 31, June 30, December 31,
1998 1997 1998 1997
----------- ----------- ------------ -----------
(unaudited) (unaudited)
$ 548,929 $ 561,849 $ 120,005 $ 281,724
108,129 38,487 5,915,109 3,075,110
(1,487) 257,800 (315,963) 601,974
----------- ----------- ------------ -----------
655,571 858,136 5,719,151 3,958,808
----------- ----------- ------------ -----------
0 (560,414) 0 (284,442)
0 (38,618) 0 (2,620,841)
----------- ----------- ------------ -----------
0 (599,032) 0 (2,905,283)
----------- ----------- ------------ -----------
4,370,048 9,230,953 1,842,264 12,883,954
0 599,032 0 2,905,283
(2,263,312) (250,000) (24,029,487) (205,235)
----------- ----------- ------------ -----------
2,106,736 9,579,985 (22,187,223) 15,584,002
----------- ----------- ------------ -----------
2,762,307 9,839,089 (16,468,072) 16,637,527
16,109,899 6,270,810 38,543,567 21,906,040
----------- ----------- ------------ -----------
$18,872,206 $16,109,899 $ 22,075,495 $38,543,567
=========== =========== ============ ===========
$ 0 $ 2,031 $ 0 $ 1,831
=========== =========== ============ ===========
$ 548,929 $ 0 $ 120,005 $ 0
=========== =========== ============ ===========
402,991 860,234 146,126 1,009,708
0 56,248 0 241,472
(207,955) (23,346) (1,751,279) (15,943)
----------- ----------- ------------ -----------
195,036 893,136 (1,605,153) 1,235,237
=========== =========== ============ ===========
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
Fixed Income Fund
-------------------------------
Six Months
Ended Year Ended
June 30, December 31,
1998 1997
------------ ----------------
(unaudited)
FROM OPERATIONS
Net investment income ..................... $ 6,598,650 $ 8,695,684
Net realized gain (loss) on investments and
foreign currency ........................ 3,178,801 2,909,561
Change in unrealized appreciation
(depreciation) on investments and
foreign currency ........................ (2,507,317) 1,883,711
------------ ------------
Increase (decrease) in net assets from
operations .............................. 7,270,134 13,488,956
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income ..................... 0 (8,861,805)
Net realized gain on investments .......... 0 (3,350,264)
------------ ------------
Total distributions ..................... 0 (12,212,069)
------------ ------------
FROM CAPITAL SHARES TRANSACTIONS
Proceeds from the sale of shares .......... 28,828,529 86,055,071
Net asset value of shares issued in
connection with the reinvestment of
distributions ........................... 0 11,967,763
Cost of shares redeemed ................... (7,185,366) (17,997,654)
------------ ------------
Increase (decrease) in net assets derived
from capital share transactions ....... 21,643,163 80,025,180
------------ ------------
Total increase (decrease) in net assets . 28,913,297 81,302,067
NET ASSETS
Beginning of period ....................... 173,048,076 91,746,009
------------ ------------
End of period ............................. $201,961,373 $173,048,076
============ ============
UNDISTRIBUTED NET INVESTMENT INCOME
Beginning of period ....................... $ (8,315) $ 241,283
============ ============
End of period ............................. $ 6,590,335 $ (8,315)
============ ============
NUMBER OF SHARES OF THE FUND:
Issued from the sale of shares ............ 2,214,449 6,599,478
Issued in connection with the reinvestment
of distributions ........................ 0 947,050
Redeemed .................................. (550,874) (1,401,398)
------------ ------------
Net change ................................ 1,663,575 6,145,130
============ ============
*Commencement of operations on January 28, 1998.
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
Intermediate Duration
High Yield Fixed Income Fund Fixed Income Fund
------------------------------------------------ -----------------------
Six Months Ended Year Ended For the Period Ended
June 30, 1998 December 31, 1997 June 30, 1998*
-------------------- --------------------- -----------------------
(unaudited) (unaudited)
$ 1,682,339 $ 1,835,703 $ 282,722
688,496 1,091,157 (53,459)
(1,986,886) (1,050,300) 1,978
------------- ------------ -------------
383,949 1,876,560 231,241
------------- ------------ -------------
0 (1,834,725) (224,115)
0 (811,668) 0
------------- ------------ -------------
0 (2,646,393) (224,115)
------------- ------------ -------------
7,022,000 23,895,000 11,888,530
0 2,646,426 224,115
------------- ------------ -------------
7,022,000 26,541,426 12,112,645
(3,490,738) 0 (1,040,783)
------------- ------------ -------------
3,531,262 26,541,426 11,071,862
------------- ------------ -------------
3,915,211 25,771,593 11,078,988
28,872,004 3,100,411 0
------------- ------------ -------------
$ 32,787,215 $ 28,872,004 $ 11,078,988
============= ============ =============
$ 704 $ 0 $ 0
============= ============ =============
$ 1,683,043 $ 704 $ 58,607
============= ============ =============
691,991 2,304,814 1,188,440
0 264,639 22,403
------------- ------------ -------------
691,991 2,569,453 1,210,843
------------- ------------ -------------
(335,971) 0 (103,785)
------------- ------------ -------------
356,020 2,569,453 1,107,058
============= ============ =============
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
Investment Grade
Fixed Income Fund
----------------------------
Six Months
Ended Year Ended
June 30, December 31,
1998 1997
-------------- ------------
(unaudited)
FROM OPERATIONS
Net investment income ..................... $ 3,235,269 $ 4,262,268
Net realized gain (loss) on investments and
foreign currency ........................ 948,858 1,023,968
Change in unrealized appreciation
(depreciation) on investments and foreign
currency ................................ (805,237) 704,886
-------------- ------------
Increase (decrease) in net assets from
operations .............................. 3,378,890 5,991,122
-------------- ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income ..................... (3,331,473) (4,113,289)
Net realized gain on investments .......... 0 (884,327)
-------------- ------------
Total distributions ..................... (3,331,473) (4,997,616)
-------------- ------------
FROM CAPITAL SHARES TRANSACTIONS
Proceeds from the sale of shares .......... 25,133,064 28,180,818
Net asset value of shares issued in
connection with the reinvestment of
distributions ........................... 2,686,329 3,906,983
Cost of shares redeemed ................... (294,624) (1,869,109)
-------------- ------------
Increase (decrease) in net assets derived
from capital share transactions ......... 27,524,769 30,218,692
-------------- ------------
Total increase (decrease) in net assets . 27,572,186 31,212,198
NET ASSETS
Beginning of period ....................... 82,963,948 51,751,750
-------------- ------------
End of period ............................. $ 110,536,134 $ 82,963,948
============== ============
UNDISTRIBUTED NET INVESTMENT INCOME
Beginning of period ....................... $ 166,580 $ 43,660
============== ============
End of period ............................. $ 70,376 $ 166,580
============== ============
NUMBER OF SHARES OF THE FUND:
Issued from the sale of shares ............ 2,066,656 2,322,895
Issued in connection with the reinvestment
of distributions ........................ 222,168 327,954
Redeemed .................................. (24,358) (154,352)
-------------- ------------
Net change ................................ 2,264,466 2,496,497
============== ============
See accompanying notes to financial statements.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
<TABLE>
<CAPTION>
California Tax-Free Income Fund
------------------------------------------------------------------
1998* 1997 1996 1995**
-------- -------- -------- -------
(unaudited)
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 10.41 $ 10.19 $ 10.23 $ 10.00
-------- -------- -------- -------
Income from investment operations -
Net investment income (loss) .............. 0.24 0.47 0.46 0.26
Net realized and unrealized gain (loss) on
investments ............................. 0.00 0.25 (0.04) 0.23
-------- -------- -------- -------
Total from investment operations ........ 0.24 0.72 0.42 0.49
-------- -------- -------- -------
Less distributions -
Dividends from net investment income ...... (0.24) (0.47) (0.45) (0.26)
Distributions from net realized capital gains 0.00 (0.03) (0.01) 0.00
-------- -------- -------- -------
Total distributions ..................... (0.24) (0.50) (0.46) (0.26)
-------- -------- -------- -------
Net asset value, end of period .............. $ 10.41 $ 10.41 $ 10.19 $ 10.23
======== ======== ======== =======
Total return (%)(a) ......................... 2.3 7.3 4.1 4.9
Net assets, end of period (000) ............. $ 17,398 $ 16,822 $ 13,460 $ 7,880
Ratio of operating expenses to average net
assets (%)(b)(c) .......................... 0.65 0.65 0.65 0.65
Ratio of net investment income to average net
assets (%)(b) ............................. 4.61 4.62 4.58 5.30
Portfolio turnover rate (%) ................. 9 24 18 18
The ratios of expenses to average net assets
without giving effect to the voluntary
expense limitations described in Note 3 to
the Financial Statements would have
been (%)(b) ............................... 1.16 1.41 1.26 1.62
Without giving effect to the voluntary
expense limitations described in Note 3 to
the Financial Statements net investment
income per share would have been: ......... $ 0.21 $ 0.39 $ 0.40 $ 0.22
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on June 1, 1995.
(a) Total returns would have been lower had the adviser not reduced its advisory fees and/or borne other operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses during the period. Without this reimbursement the
Fund's ratio of operating expenses would have been higher.
</TABLE>
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
<TABLE>
<CAPTION>
Core Fixed Income Fund
-------------------------------------------
1998* 1997 1996**
-------- -------- --------
(unaudited)
<S> <C> <C> <C>
Net asset value, beginning of period .................... $ 10.66 $ 10.14 $ 10.00
-------- -------- --------
Income from investment operations -
Net investment income (loss) .......................... 0.32 0.39 0.40
Net realized and unrealized gain (loss) on investments 0.08 0.55 0.13
-------- -------- --------
Total from investment operations .................... 0.40 0.94 0.53
-------- -------- --------
Less distributions -
Dividends from net investment income .................. 0.00 (0.39) (0.39)
Distributions from net realized capital gains ......... 0.00 (0.03) 0.00
-------- -------- --------
Total distributions ................................. 0.00 (0.42) (0.39)
-------- -------- --------
Net asset value, end of period .......................... $ 11.06 $ 10.66 $ 10.14
======== ======== ========
Total return (%)(a) ..................................... 3.8 9.2 5.3
Net assets, end of period (000) ....................... $ 18,872 $ 16,110 $ 6,271
Ratio of operating expenses to average net assets
(%)(b)(c) ........................................... 0.65 0.65 0.65
Ratio of net investment income to average net assets
(%)(b) .............................................. 6.09 6.34 6.21
Portfolio turnover rate (%) ........................... 36 59 34
The ratios of expenses to average net assets without
giving effect to the voluntary expense limitations
described in Note 3 to the financial statements
would have been (%)(b) ............................... 1.15 1.80 1.46
Without giving effect to the voluntary expense
limitations described in Note 3 to the Financial
Statements net investment income per share would have
been: ................................................. $ 0.29 $ 0.32 $ 0.35
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on April 24, 1996.
(a) Total returns would have been lower had the adviser not reduced its advisory fees and/or borne other
operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses during the period. Without this
reimbursement the Fund's ratio of operating expenses would have been higher.
</TABLE>
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
<TABLE>
<CAPTION>
Core Growth Fund
-------------------------------------------------
1998* 1997 1996 1995**
-------- -------- -------- -------
(unaudited)
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 12.26 $ 11.48 $ 10.02 $ 10.00
-------- -------- -------- -------
Income from investment operations -
Net investment income (loss) .............. 0.08 0.10 0.10 0.02
Net realized and unrealized gain (loss) on
investment .............................. 2.01 1.68 1.47 0.02
-------- -------- -------- -------
Total from investment operations ........ 2.09 1.78 1.57 0.04
-------- -------- -------- -------
Less distributions -
Dividends from net investment income ...... 0.00 (0.10) (0.11) (0.02)
Distributions from net realized capital gains 0.00 (0.90) 0.00 0.00
-------- -------- -------- -------
Total distributions ..................... 0.00 (1.00) (0.11) (0.02)
-------- -------- -------- -------
Net asset value, end of period .............. $ 14.35 $ 12.26 $ 11.48 $ 10.02
======== ======== ======== =======
Total return (%)(a) ......................... 17.1 15.7 15.6 0.4
Net assets, end of period (000) ............. $ 22,075 $ 38,544 $ 21,906 $ 7,609
Ratio of operating expenses to average net
assets (%)(b)(c) .......................... 0.65 0.65 0.65 0.65
Ratio of net investment income to average net
assets (%)(b) ............................. 0.80 0.87 1.10 1.36
Portfolio turnover rate (%) ................. 65 109 97 22
The ratios of expenses to average net assets
without giving effect to the voluntary
expense limitations described in Note 3 to
the Financial Statements would have
been (%)(b) ............................... 0.85 0.89 0.89 1.43
Without giving effect to the voluntary
expense limitations described in Note 3 to
the Financial Statements net investment
income per share would have been: ......... $ 0.06 $ 0.07 $ 0.08 $ 0.01
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on October 1, 1995.
(a) Total returns would have been lower had the adviser not reduced its advisory fees and/or borne other
operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses during the period. Without this
reimbursement the Fund's ratio of operating expenses would have been higher.
</TABLE>
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
<TABLE>
<CAPTION>
Fixed Income Fund
-------------------------------------------------------------
1998* 1997 1996 1995**
-------- -------- -------- -------
(unaudited)
<S> <C> <C> <C> <C>
Net asset value, beginning of period .... $ 12.59 $ 12.08 $ 12.08 $ 10.00
-------- -------- -------- -------
Income from investment operations -
Net investment income (loss) .......... 0.43 0.72 0.91 0.53
Net realized and unrealized gain (loss)
on investment ....................... 0.09 0.89 0.27 2.21
-------- -------- -------- -------
Total from investment operations .... 0.52 1.61 1.18 2.74
-------- -------- -------- -------
Less distributions -
Dividends from net investment income .. 0.00 (0.75) (0.90) (0.52)
Distributions from net realized capital
gains 0.00 (0.35) (0.28) (0.14)
-------- -------- -------- -------
Total distributions ................. 0.00 (1.10) (1.18) (0.66)
-------- -------- -------- -------
Net asset value, end of period .......... $ 13.11 $ 12.59 $ 12.08 $ 12.08
======== ======== ======== =======
Total return (%)(a) ..................... 4.1 13.4 9.8 27.4
Net assets, end of period (000) ......... $201,961 $173,048 $ 91,746 $58,332
Ratio of operating expenses to average
net assets (%)(b)(c) .................. 0.65 0.65 0.62 0.75
Ratio of net investment income to average
net assets (%)(b) ..................... 7.09 7.56 7.97 8.15
Portfolio turnover rate (%) ............. 14 41 90 76
The ratios of expenses to average net
assets without giving effect to the
voluntary expense limitations described
in Note 3 to the Financial Statements
would have been (%)(b) ................ 0.66 0.70 0.62 0.83
Without giving effect to the voluntary
expense limitations described in Note 3
to the Financial Statements net
investment income per share would have
been: ................................. $ 0.43 $ 0.72 $ 0.91 $ 0.52
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on January 17, 1995.
(a) Total returns would have been lower had the adviser not reduced its advisory fees and/or borne other operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses during the period. Without this reimbursement
the Fund's ratio of operating expenses would have been higher.
</TABLE>
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
<TABLE>
<CAPTION>
High Yield Fixed Income Fund
-----------------------------------------------
1998* 1997 1996**
-------- -------- --------
(unaudited)
<S> <C> <C> <C>
Net asset value, beginning of period .................... $ 10.04 $ 10.16 $ 10.00
-------- -------- --------
Income from investment operations -
Net investment income (loss) .......................... 0.52 0.70 0.56
Net realized and unrealized gain (loss) on investments (0.41) 0.20 0.21
-------- -------- --------
Total from investment operations .................... 0.11 0.90 0.77
-------- -------- --------
Less distributions -
Dividends from net investment income .................. 0.00 (0.71) (0.56)
Distributions from net realized capital gains ......... 0.00 (0.31) (0.05)
-------- -------- --------
Total distributions ................................. 0.00 (1.02) (0.61)
-------- -------- --------
Net asset value, end of period .......................... $ 10.15 $ 10.04 $ 10.16
======== ======== ========
Total return (%)(a) ..................................... 1.1 8.8 7.7
Net assets, end of period (000) ......................... $ 32,787 $ 28,872 $ 3,100
Ratio of operating expenses to average net assets
(%)(b)(c) ............................................. 0.75 0.75 0.75
Ratio of net investment income to average net assets
(%)(b) ................................................ 10.09 8.82 9.42
Portfolio turnover rate (%) ............................. 30 94 9
The ratios of expenses to average net assets without
giving effect to the voluntary expense limitations
described in Note 3 to the Financial Statements would
have been (%)(b) ...................................... 0.98 1.17 2.73
Without giving effect to the voluntary expense
limitations described in Note 3 to the Financial
Statements net investment income per share would have
been: ................................................. $ 0.51 $ 0.67 $ 0.44
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on June 5, 1996.
(a) Total returns would have been lower had the adviser not reduced its advisory fees and/or borne other operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses during the period. Without this reimbursement
the Fund's ratio of operating expenses would have been higher.
</TABLE>
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Period Ended June 30, (Unaudited)
Intermediate Duration
Fixed Income Fund
---------------------
1998*
---------------------
Net asset value, beginning of period ........................ $ 10.00
----------
Income from investment operations -
Net investment income (loss) .............................. 0.25
Net realized and unrealized gain (loss) on investment ..... (0.04)
----------
Total from investment operations ........................ 0.21
----------
Less distributions -
Dividends from net investment income ...................... (0.20)
Distributions from net realized capital gains ............. 0.00
----------
Total distributions ..................................... (0.20)
----------
Net asset value, end of period .............................. $ 10.01
==========
Total return (%)(a) ......................................... 2.1
Net assets, end of period (000) ............................. $ 11,079
Ratio of operating expenses to average net assets (%)(b)(c) . 0.55
Ratio of net investment income to average net assets (%)(b) . 5.98
Portfolio turnover rate (%) ................................. 68
The ratios of expenses to average net assets without giving
effect to the voluntary expense limitations described in
Note 3 to the Financial Statements would have been
(%)(b) .................................................... 1.21
Without giving effect to the voluntary expense limitations
described in Note 3 to the Financial Statements net
investment income per share would have been: .............. $ 0.23
- ------------
* Commencement of operations on January 28, 1998.
(a) Total returns would have been lower had the adviser not reduced its
advisory fees and/or borne other operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses
during the period. Without this reimbursement the Fund's ratio of
operating expenses would have been higher.
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
Investment Grade
Fixed Income Fund
------------------
1998*
------------------
(unaudited)
Net asset value, beginning of period ......................... $ 12.06
----------
Income from investment operations -
Net investment income (loss) ............................... 0.40
Net realized and unrealized gain (loss) on investments ..... 0.05
----------
Total from investment operations ......................... 0.45
----------
Less distributions -
Dividends from net investment income ....................... (0.42)
Distributions from net realized capital gains .............. 0.00
----------
Total distributions ...................................... (0.42)
----------
Net asset value, end of period ............................... $ 12.09
==========
Total return (%)(a) .......................................... 3.8
Net assets, end of period (000) .............................. $ 110,536
Ratio of operating expenses to average net assets (%)(b)(c)... 0.55
Ratio of net investment income to average net assets (%)(b) .. 6.76
Portfolio turnover rate (%) .................................. 31
The ratios of expenses to average net assets without giving
effect to the voluntary expense limitations described in
Note 3 to the Financial Statements would have been (%)(b) .. 0.60
Without giving effect to the voluntary expense limitations
described in Note 3 to the Financial Statements net
investment income per share would have been: ............... $ 0.40
- ------------
* For the six months ended June 30, 1998.
** Commencement of operations on July 1, 1994.
(a) Total returns would have been lower had the adviser not reduced its
advisory fees and/or borne other operating expenses.
(b) Annualized for periods less than one year.
(c) The adviser has agreed to reimburse a portion of the Fund's expenses
during the period. Without this reimbursement the Fund's ratio of
operating expenses would have been higher.
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Year Ended December 31,
Investment Grade Fixed Income Fund
- ------------------------------------------------------------------------
1997 1996 1995 1994**
-------- -------- -------- -------
$ 11.81 $ 11.56 $ 9.57 $ 10.00
-------- -------- -------- -------
0.83 0.80 0.75 0.41
0.37 0.40 2.05 (0.43)
-------- -------- -------- -------
1.20 1.20 2.80 (0.02)
-------- -------- -------- -------
(0.81) (0.79) (0.76) (0.41)
(0.14) (0.16) (0.05) 0.00
-------- -------- -------- -------
(0.95) (0.95) (0.81) (0.41)
-------- -------- -------- -------
$ 12.06 $ 11.81 $ 11.56 $ 9.57
======== ======== ======== =======
10.6 10.9 30.3 (0.3)
$ 82,964 $ 51,752 $ 21,816 $ 4,649
0.55 0.55 0.55 0.55
6.97 7.27 7.61 8.18
58 74 22 112
0.69 0.70 0.94 1.55
$ 0.81 $ 0.78 $ 0.71 $ 0.36
<PAGE>
LOOMIS SAYLES INVESTMENT TRUST
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (unaudited)
June 30, 1998
1. Loomis Sayles Investment Trust (the "Trust") consists of seven no-load
mutual funds (the "Funds").
The Trust was organized as a Massachusetts business trust under the laws of the
Commonwealth of Massachusetts on December 23, 1993. The Trust is a diversified,
open-end management investment company registered with the Securities and
Exchange Commission under the Investment Company Act of 1940, as amended (the
"1940 Act"), and the interests in which were registered for offer and sale,
effective March 7, 1997, under the Securities Act of 1933, as amended (the "1933
Act"). The Trust is authorized to issue an unlimited number of full and
fractional shares of beneficial interest in multiple series.
Each Fund is separately managed and has its own investment objective and
policies. Loomis, Sayles & Company, L.P. ("Loomis Sayles") is the investment
adviser of each fund.
The Trust consists of the following Funds:
Loomis Sayles California Tax-Free Income Fund
Loomis Sayles Core Fixed Income Fund
Loomis Sayles Core Growth Fund
Loomis Sayles Fixed Income Fund
Loomis Sayles High Yield Fixed Income Fund
Loomis Sayles Intermediate Duration Fixed Income Fund
Loomis Sayles Investment Grade Fixed Income Fund
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 in the financial statements. Actual
results could differ from those estimates. The following summarizes the
significant accounting policies of the Loomis Sayles Investment Trust Funds:
A. SECURITY VALUATION -- Long-term debt securities for which quotations are
readily available are valued by a pricing service, as approved by the Board of
Trustees, which generally uses the most recent bid prices in the principal
market in which such securities are normally traded. Municipal debt securities
are valued by a pricing service, as approved by the Board of Trustees, which
generally uses a computerized matrix system or dealer supplied quotations that
consider market transactions for comparable securities. Equity securities for
which quotations are readily available are valued at their last sale price on
the exchange where primarily traded or, if there is no reported sale during the
day, at the closing bid price. Short-term securities with a remaining maturity
of 60 days or less are valued at amortized cost, which approximates market
value. Other securities for which quotations are not readily available
(including restricted securities, if any) are valued primarily using dealer
supplied quotations or at their fair values as determined in good faith under
the general supervision of the Board of Trustees.
B. REPURCHASE AGREEMENTS -- The Funds may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the Funds take
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Funds to resell, the obligation at an agreed-upon
price and time. This arrangement results in a fixed rate of return that is not
subject to market fluctuations during the Funds' holding period. The Funds,
through their custodian, receive delivery of the underlying securities
collateralizing repurchase agreements. It is the Funds' policy that the market
value of the collateral be at least equal to 102% of the repurchase price. These
securities are marked-to-market daily. Loomis Sayles is responsible for
determining that the value of the collateral is at all times at least equal to
102% of the repurchase price. In connection with transactions in repurchase
agreements, if the seller defaults and the value of the collateral declines or
if the seller enters into insolvency proceedings, realization of the collateral
by the Funds may be delayed or limited.
C. FOREIGN CURRENCY TRANSLATION AND FOREIGN INVESTMENTS -- The books and records
of each of the Funds (including those Funds that invest in foreign securities)
are maintained in U.S. dollars. The value of securities, currencies and other
assets and liabilities denominated in currencies other than U.S. dollars is
translated into U.S. dollars based upon foreign exchange rates prevailing at the
end of the period. Purchases and sales of investment securities are translated
at contractual currency exchange rates established at the time of the trade.
Income and expenses are translated at prevailing exchange rates on the
respective dates of such transactions.
The results of operations resulting from changes in foreign exchange rates on
investments are not isolated from fluctuations arising from changes in market
prices of securities held. All such fluctuations are included with net realized
and unrealized gain or loss from investments.
Net realized and unrealized gains and losses on foreign currency transactions
represent foreign exchange gains and losses from the sale of short-term
securities and holdings of foreign currencies, foreign currency gains and
losses between trade dates and settlement dates on investment securities
transactions, sales and maturities of forward foreign currency exchange
contracts, and the difference between the amounts of daily interest accruals
on the books of the Funds and the amounts actually received resulting from
changes in exchange rates on the payable date.
Certain funds use foreign currency exchange contracts to facilitate transactions
in foreign-denominated securities. Losses may arise from changes in the value of
the foreign currency or if the counterparties do not perform under the
contracts' terms. The U.S. dollar value of foreign currency is determined using
contractual currency exchange rates established at the time of each trade. The
cost of the foreign currency exchange contracts is included in the cost basis of
the associated investment.
Each Fund (except the California Tax-Free Income Fund) may purchase securities
of foreign issuers. Investing in securities of foreign companies and foreign
governments involves special risks and considerations not typically associated
with investing in U.S. companies and securities of the U.S. government. These
risks include revaluation of currencies and the risk of appropriation. Moreover,
the markets for securities of many foreign companies and foreign governments may
be less liquid, and the prices of such securities may be more volatile than
those securities of comparable U.S. companies and the U.S. government.
D. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS -- Each Fund that may invest in
foreign securities may enter into forward foreign currency exchange contracts to
protect securities against changes in future foreign exchange rates. A forward
foreign currency exchange contract is an agreement between two parties to buy or
sell currency at a set price on a future date.
The market value of the contract will fluctuate with changes in currency
exchange rates. The contract is marked-to-market daily using the forward rate
and the change in market value is recorded as unrealized appreciation
(depreciation) on foreign currency transactions in the Funds' Statements of
Assets and Liabilities. Realized gain or loss is recognized when the contract is
closed equal to the difference between the value of the contract at the time it
was opened and the value at the time it was closed and recorded as realized gain
(loss) on foreign currency transactions in the Funds' Statements of Operations.
Risks may arise upon entering into forward foreign currency exchange contracts
from the potential inability of the counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar. At June 30, 1998, there were no open forward
foreign currency exchange contracts.
E. SECURITY TRANSACTIONS, RELATED INVESTMENT INCOME AND EXPENSES -- Security
transactions are accounted for on the trade date (the date the buy or sell is
executed). Dividend income is recorded on the ex-dividend date and interest
income is recorded on the accrual basis. Interest income is increased by the
accretion of discount. Discounts on zero coupon bonds, original issues, step
bonds and payment in kind bonds are accreted according to the effective interest
method. Interest income on the California Tax-Free Income Fund is decreased by
the amortization of premium. Premiums are amortized using the yield to maturity
method. In determining net gain or loss on securities sold, the cost of
securities are determined on the identified cost basis.
Most expenses of the Trust can be directly attributed to a particular fund.
Expenses which cannot be directly attributed are apportioned among the Funds
based upon relative net assets.
F. WHEN-ISSUED SECURITIES -- Each Fund may purchase securities on a when- issued
basis. Securities purchased on a when-issued basis are purchased for delivery
beyond the normal settlement period at a stated price and yield, and no income
accrues to the Fund on such securities prior to delivery. Each Fund instructs
the custodian to establish a segregated account in which it maintains liquid
assets at least equal to the amount of its when-issued purchase commitments.
Purchasing securities on a when-issued basis may involve a risk that the market
price at the time of delivery may be lower than the agreed-upon purchase price,
in which case there could be an unrealized loss at the time of delivery. At June
30, 1998, the Funds had no such commitments.
G. FEDERAL INCOME TAXES -- Each Fund is a separate entity for federal income tax
purposes. Each Fund intends to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies, and to distribute to its
shareholders all of its net investment income and any net realized capital
gains. Accordingly, no provision for federal income tax or excise tax has been
made.
H. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The California Tax-Free
Income, the Intermediate Duration Fixed Income and the Investment Grade Fixed
Income Funds pay their net investment income monthly. The Core Fixed Income,
Core Growth, Fixed Income and High Yield Fixed Income Funds pay their net
investment income to shareholders annually. Distributions from net realized
capital gains, if any, are declared and paid on an annual basis by all of the
Funds. Income and capital gain distributions are determined in accordance with
Federal income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in reclassifications
to the Fund's capital accounts to reflect income and gains available for
distribution, are primarily due to differing book and tax treatments for foreign
currency transactions, deferred losses due to wash sales and excise tax
regulations. Some of these classifications may include temporary book and tax
basis differences that will reverse in subsequent periods.
I. ORGANIZATION EXPENSE -- In 1996, costs approximating $11,970 were incurred in
connection with the initial registration and organization of the Core Fixed
Income Fund. These costs were paid by the Fund and are being amortized over 60
months.
2. PURCHASES AND SALES OF SECURITIES -- (excluding short-term investments) for
each Fund for the period ended June 30, 1998 were as follows:
Purchases
---------------------------------
U.S. Government Other
--------------- -----------
California Tax-Free Income Fund ............ $ 0 $ 1,733,224
Core Fixed Income Fund ..................... 2,801,911 6,373,779
Core Growth Fund ........................... 0 18,392,315
Fixed Income Fund .......................... 13,184,329 49,256,533
High Yield Fixed Income Fund ............... 1,590,750 12,679,606
Intermediate Duration Fixed Income Fund .... 6,920,021 11,208,328
Investment Grade Fixed Income Fund ......... 12,991,263 42,917,051
Sales
---------------------------------
U.S. Government Other
--------------- -----------
California Tax-Free Income Fund ............ $ 0 $ 1,467,137
Core Fixed Income Fund ..................... 6,138,267 141,316
Core Growth Fund ........................... 0 40,034,545
Fixed Income Fund .......................... 1,553,906 24,516,102
High Yield Fixed Income Fund ............... 1,612,000 8,101,191
Intermediate Duration Fixed Income Fund .... 5,978,560 1,340,045
Investment Grade Fixed Income Fund ......... 15,743,734 12,826,662
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES -- During the period
ended June 30, 1998, the Funds incurred management fees payable to Loomis
Sayles. Certain officers and directors of Loomis Sayles are also officers or
Trustees of the Trust. Loomis Sayles' general partner is indirectly owned by
NVEST, L.P., a publicly-traded limited partnership whose general partner is
indirectly owned by Metropolitan Life Insurance Company. Separate management
agreements for each Fund in effect during the period ended June 30, 1998,
provided for fees at the following annual percentage rate of each Fund's average
daily net assets:
Fund Annual Percentage Rate
---- ----------------------
California Tax Free Income Fund .................... 0.50%
Core Fixed Income Fund ............................. 0.50%
Core Growth Fund ................................... 0.50%
Fixed Income Fund .................................. 0.50%
High Yield Fixed Income Fund ....................... 0.60%
Intermediate Duration Fixed Income Fund ............ 0.40%
Investment Grade Fixed Income Fund ................. 0.40%
Loomis Sayles voluntarily agreed, for an indefinite period, to reduce its
advisory fees and/or bear other expenses, to the extent necessary to limit the
total operating expenses of the Funds to the following percentage rate of the
Fund's average annual net assets:
Fund
Percentage
Fund Rate
---- ----------
California Tax-Free Income Fund ............................ 0.65%
Core Fixed Income Fund ..................................... 0.65%
Core Growth Fund ........................................... 0.65%
Fixed Income Fund .......................................... 0.65%
High Yield Fixed Income Fund ............................... 0.75%
Intermediate Duration Fixed Income Fund .................... 0.55%
Investment Grade Fixed Income Fund ......................... 0.55%
Loomis Sayles may change or terminate these voluntary agreements at any time,
but the relevant prospectus would be supplemented at the time to describe the
change.
A. TRUSTEES FEES AND EXPENSES -- The Trust does not pay any compensation
directly to its officers or Trustees who are directors, officers or employees of
Loomis Sayles, Metropolitan Life Insurance Company or their affiliates. Each
independent Trustee is compensated by the Trust at the rate of $10,000 per
annum, plus travel expenses for each meeting attended. These expenses are
allocated evenly among the Funds in the Trust.
4. CREDIT RISK -- The High Yield Fixed Income Fund will invest at least 65%, the
Fixed Income may invest up to 35%, and the Investment Grade Fixed Income may
invest up to 10% of its total net assets in securities offering high current
income, which generally will be in the lower rating categories of recognized
rating agencies. These securities are regarded as predominantly speculative with
respect to the capacity to pay interest and repay principal in accordance with
the terms of the obligations and will generally involve more credit risk than
securities in the higher-rated categories. In addition, the trading market for
high yield securities may be relatively less liquid than the market for
higher-rated securities.
5. CONCENTRATION -- The California Tax-Free Income Fund primarily invests in
debt obligations issued by the State of California, its political subdivisions,
agencies and public authorities to obtain funds for various public purposes. The
Fund is more susceptible to factors adversely affecting issuers of California
municipal securities than is a municipal bond fund that does not concentrate its
investments in the securities of issuers of a single state.
<PAGE>
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LOOMIS SAYLES INVESTMENT TRUST
- ------------------------------
TRUSTEE
Timothy J. Hunt
OFFICERS
PRESIDENT
Daniel J. Fuss
EXECUTIVE VICE PRESIDENT TREASURER
Robert J. Blanding Mark W. Holland
VICE PRESIDENTS ASSISTANT TREASURER
William F. Camp Nicholas H. Palmerino
Quentin P. Faulkner
Kathleen C. Gaffney
Jeffrey L. Meade SECRETARY
Robert K. Payne Sheila M. Barry
Mari J. Sugahara
Frederick E. Sweeney, Jr.
Anthony J. Wilkins ASSISTANT SECRETARY
Bonnie S. Thompson
<PAGE>
For Information about:
o Establishing an account
o Account procedures and status
o Exchanges
o Shareholder services
Phone 888-226-9699 (Toll Free)
INVESTMENT ADVISER
Loomis, Sayles & Company, L.P. o One Financial Center o Boston, MA 02111
TRANSFER AND DIVIDEND PAYING AGENT AND CUSTODIAN OF ASSETS
State Street Bank and Trust Company o Boston, MA 02102
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP o One Post Office Square o Boston, MA 02109
This report has been prepared for the shareholders of the Funds and is not
authorized for distribution to prospective investors in the Funds unless it is
accompanied or preceded by an effective prospectus.