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The Eaton Vance Growth Trust
For the Growth Portfolio
[Logo]
Semi-Annual Shareholder Report
February 29, 1996
Portfolio Investment Advisers
Boston Management and Research
24 Federal Street
Boston, MA 02110
Fund Administrator
Eaton Vance Management
24 Federal Street
Boston, MA 02110
(617) 482-8260
Principal Underwriter
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
89 South Street
P.O. Box 1537
Boston, MA 02205-1537
Transfer Agent
First Data Investor Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
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GROWTH PORTFOLIO
PORTFOLIO OF INVESTMENTS
FEBRUARY 29, 1996
(UNAUDITED)
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COMMON STOCKS - 96.5%
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SHARES VALUE
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ADVERTISING - 3.4%
Omnicom Group, Inc. 120,000 $ 4,905,000
The parent company of DDB Needham ------------
Worldwide and BBDO Worldwide, two full
service advertising agency networks.
BEVERAGES - 3.0%
PepsiCo, Inc. 70,000 $ 4,427,500
Global soft drink producer with ------------
businesses in snack foods and fast food
restaurants.
BROADCASTING & ENTERTAINMENT - 3.0%
Seagram Co. Ltd. 80,000 $ 2,750,000
A leading global producer and marketer
of liquor which acquired 80% of MCA,
Inc., a major factor in the
entertainment industry.
Viacom Inc. Class B 40,000 1,570,000
A diversified media/entertainment
company with major positions in motion
pictures, theme parks, publishing,
network broadcoasting and video
retailing.
------------
$ 4,320,000
------------
BUSINESS PRODUCTS AND SERVICES - 10.3%
Danka Business Systems PLC ADR 50,000 $ 2,187,500
Independent distributor of automated
office equipment, principally
photocopiers, and related service
contracts.
International Business Machines Corp. 25,000 3,065,625
The world's largest supplier of
hardware, software and support services
in the information processing industry.
Reuters Holdings PLC 80,000 5,160,000
Worldwide provider of proprietary
financial data and information.
Xerox Corp. 35,000 4,558,750
The dominant producer of high end
document processing machines.
------------
$ 14,971,875
------------
CHEMICALS - 1.2%
Praxair Inc. 50,000 $ 1,725,000
The largest producer of industrial gases ------------
in North and South America.
COMPUTER EQUIPMENT AND SERVICES - 4.7%
Automatic Data Processing, Inc. 80,000 $ 3,100,000
The leading independent computing and
payroll processing services firm in the U.S.
General Motors Corp. Class E 65,000 $ 3,713,125
Stock represents participation in the
Electronic Data Systems Division of
General Motors. EDS designs, installs
and operates data processing and
communications systems for GM and other
customers.
------------
$ 6,813,125
------------
DRUGS & HEALTH CARE SERVICES -- 14.1%
American Home Products 30,000 $ 2,955,000
Leading manufacturer of prescription
drugs, medical supplies and diagnostics,
as well as agricultural herbicides
and consumer medications and branded
food products.
Astra AB A Free Shares* 175,000 8,036,928
Swedish based international
pharmaceutical firm with drugs for the
control of ulcers and asthma.
Pfizer Inc. 55,000 3,623,125
A large international ethical
pharmaceutical manufacturer with
important positions in hospital products
and animal health.
Sofamor Danek Group, Inc.* 180,000 5,872,500
The dominant supplier of spinal implant
devices used in surgical treatment of
spinal diseases and deformities.
------------
$ 20,487,553
------------
ELECTRICAL EQUIPMENT - 2.0%
AMP Inc. 70,000 $ 2,983,750
The leading world wide producer of ------------
electrical and electronic connector,
switching and programming devices.
ELECTRONIC INSTRUMENTATION - 3.3%
Millipore Corp. 70,000 $ 3,106,250
Products use membrane separations
technology to analyze and purify fluids
for a variety of high tech industries.
Teradyne Inc. 80,000 1,630,000
The largest supplier of automatic test
equipment for semiconductor
manufacturers, circuit board
manufacturers and telephone line
operators.
------------
$ 4,736,250
------------
FINANCIAL SERVICES - 10.4%
Advanta Corp. 70,000 $ 3,150,000
Originates and services consumer loans,
primarily through direct marketing of
Visa and MasterCharge credit cards.
Federal National Mortgage Association 120,000 3,795,000
U.S. Government sponsored mortgage
lender and provider of secondary
mortgage market.
Franklin Resources Inc. 50,000 $ 2,881,250
Provides investment management and
related services to a family of equity
and fixed income mutual funds.
MBNA Corp. 75,000 2,118,750
Dominant issuer of MasterCard/Visa
credit cards to affinity groups.
MGIC Investment Corp. Wisc. 55,000 3,203,750
The leading provider of private mortgage
insurance coverage to U.S. banks and
other mortgage suppliers.
------------
$ 15,148,750
------------
HOTELS AND RESTAURANTS - 1.8%
Circus Circus Enterprises, Inc. 80,000 $ 2,550,000
Major operator of theme related gaming ------------
facilities including 10 casino-hotels in
Nevada.
HOUSEHOLD PRODUCTS - 2.6%
Gillette Co. 70,000 $ 3,788,750
A global company with internationally ------------
recognized brands in razors and blades,
small appliances, cosmetics, dental and
other consumer products.
INSURANCE - 8.8%
Allstate Corp. 95,000 $ 4,073,125
Leading underwriter of automotive and
homeowners insurance as well as a life
insurance carrier.
American International Group, Inc. 60,000 5,797,500
One of the world's leading insurance
companies, operating in 130 countries.
Progressive Corp., Inc. 65,000 2,990,000
Underwriter of non-standard automobile
and other specialty personal lines of
insurance.
------------
$ 12,860,625
------------
MACHINERY - 2.4%
Deere & Co 90,000 $ 3,521,250
The largest agricultural equipment ------------
company and also producer of earthmoving
and forestry machinery.
METALS & MINING - 5.0%
Freeport McMoRan Copper & Gold, Inc. 100,000 $ 3,200,000
Operator of third largest copper mine in
the world with world's largest gold
reserves.
Nucor Corp. 35,000 1,885,625
Fourth largest US steel company and
largest US minimill.
Potash Corp. of Saskatchewan 30,000 2,227,500
The global leader of potash production
and number three in phosphates, two of
the three components of fertilizer
nutrients.
------------
$ 7,313,125
------------
OIL - 6.0%
Anadarko Petroleum Corp. 100,000 $ 5,450,000
Leading independent natural gas and
crude oil production company.
Triton Energy Corp. 65,000 3,225,625
Independent oil and gas producer with
major developments in Columbia and
Thailand.
------------
$ 8,675,625
------------
PHOTOGRAPHY -- 2.5%
Eastman Kodak Co. 50,000 $ 3,575,000
Largest producer of photographic ------------
products in the world.
PUBLISHING - 2.1%
McGraw Hill Inc. 35,000 $ 3,058,124
Supplies informational products and ------------
services for businesses, education and
industry through a broad range of media.
RETAILING - 2.9%
Home Depot, Inc. 40,000 $ 1,730,000
A chain of do-it-yourself warehouse
style stores.
Lowes Companies 80,000 2,480,000
Operator of discount stores that cater
to home building and the home
improvement market.
------------
$ 4,210,000
------------
SEMICONDUCTORS - 5.2%
Intel Corp. 60,000 $ 3,528,750
A manufacturer of semiconductors and
other microcomputer components and
systems which comprise the heart of the
personal computer.
MEMC Electronic Materials, Inc. 120,000 4,080,000
Worldwide producer of silicon wafers
used in the production of
semiconductors.
------------
$ 7,608,750
------------
TELEPHONE UTILITIES - 1.8%
Frontier Corp. 85,000 $ 2,550,000
Frontier is a local (half Rochester, NY ------------
and half other states) phone company and
the fifth largest long distance carrier.
TOTAL COMMON STOCKS
(IDENTIFIED COST, $100,960,599) $140,230,052
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SHORT-TERM OBLIGATION - 3.4%
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FACE AMOUNT
(000 OMITTED) VALUE
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Prudential Funding Corp., 5.43s, 3/1/96 4,920 $ 4,920,000
------------
TOTAL SHORT-TERM OBLIGATION, AT
AMORTIZED COST $ 4,920,000
------------
TOTAL INVESTMENTS
(IDENTIFIED COST, $105,880,599) $145,150,052
OTHER ASSETS, LESS LIABILITIES - 0.1% $ 186,827
------------
NET ASSETS - 100% $145,336,879
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*Non-income producing security.
The accompanying notes are an integral part
of the financial statements
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FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
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February 29, 1996 (Unaudited)
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ASSETS:
Investments, at value (Note 1A) (identified cost,
$105,880,599) $145,150,052
Cash 1,310
Dividends receivable 189,498
Deferred organization expenses (Note 1C) 11,196
------------
Total assets $145,352,056
LIABILITIES:
Payable to affiliate --
Trustees' fee $ 2,170
Accrued expenses 13,007
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Total liabilities 15,177
------------
NET ASSETS applicable to investors' interest in Portfolio $145,336,879
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SOURCES OF NET ASSETS:
Net proceeds from capital contributions and withdrawals $106,067,426
Unrealized appreciation of investments (computed on
the basis of identified cost) 39,269,453
------------
Total $145,336,879
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The accompanying notes are an integral part of the financial statements
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STATEMENT OF OPERATIONS
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For the six months ended February 29, 1996 (Unaudited)
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INVESTMENT INCOME:
Income --
Dividends $ 827,613
Interest 180,544
-----------
Total income $ 1,008,157
Expenses --
Investment adviser fee (Note 2) $ 433,594
Compensation of Directors not members of the
Investment Adviser's organization (Note 2) 2,844
Custodian fees (Note 2) 44,252
Legal and accounting services 13,560
Amortization of organization expenses (Note 1C) 1,638
Miscellaneous 2,090
-----------
Total expenses 497,978
-----------
Net investment income $ 510,179
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investment transactions
(identified cost basis) $ 2,997,806
Change in unrealized appreciation of investments 13,252,772
-----------
Net realized and unrealized gain on investments 16,250,578
-----------
Net increase in net assets from operations $16,760,757
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The accompanying notes are an integral part of the financial statements
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STATEMENT OF CHANGES IN NET ASSETS
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SIX MONTHS ENDED
FEBRUARY 29, YEAR ENDED
1996 AUGUST 31,
(UNAUDITED) 1995
---------------- ----------------
INCREASE IN NET ASSETS:
From operations --
Net investment income $ 510,179 $ 846,704
Net realized gain on investment
transactions 2,997,806 1,358,348
Change in unrealized
appreciation of investments 13,252,772 16,976,967
------------ ------------
Increase in net assets from
operations $ 16,760,757 $ 19,182,019
------------ ------------
Capital transactions --
Contributions $ 4,900,173 $ 48,765,499
Withdrawals (10,326,651) (65,480,787)
------------ ------------
Decrease in net assets
resulting from capital
transactions $ (5,426,478) $(16,715,288)
------------ ------------
Total increase in net assets $ 11,334,279 $ 2,466,731
NET ASSETS:
At beginning of period 134,002,600 131,535,869
----------- ------------
At end of period $145,336,879 $134,002,600
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SUPPLEMENTARY DATA
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SIX MONTHS ENDED YEAR ENDED AUGUST 31,
FEBRUARY 29, 1996 ----------------------
(UNAUDITED) 1995 1994*
----------------- ---- -----
RATIOS (As a percentage of
average net assets):
Expenses 0.72%+ 0.73% 0.73%+
Net investment income 0.74%+ 0.67% 0.66%+
PORTFOLIO TURNOVER 33% 84% 4%
AVERAGE COMMISSION RATE PAID** 0.14%
+Computed on an annualized basis.
*For the period from the start of business, August 2, 1994, to August 31, 1994.
**Average commission rate paid is computed by dividing the total dollar amount
of commissions paid during the fiscal year by the total number of shares
purchased and sold during the fiscal year for which commissions was charged.
Amount is computed on a non-annualized basis.
The accompanying notes are an integral part of the financial statements
<PAGE>
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 29, 1996
(UNAUDITED)
(1) SIGNIFICANT ACCOUNTING POLICIES
Growth Portfolio (the Portfolio) is registered under the Investment Company
Act of 1940 as a diversified open-end investment company which was organized
as a trust under the laws of the State of New York on August 2, 1994. The
Declaration of Trust permits the Trustees to issue interests in the Portfolio.
Investment operations began on August 2, 1994, with the acquisition of
investments with a value of $127,122,709, including unrealized appreciation of
$6,444,330 in exchange for an interest in the Portfolio by one of the
Portfolio's investors. The following is a summary of significant accounting
policies of the Portfolio. The policies are in conformity with generally
accepted accounting principles.
A. INVESTMENT VALUATIONS -- Investments listed on securities exchanges or in
the NASDAQ National Market are valued at closing sale prices. Listed or
unlisted investments for which closing sale prices are not available are
valued at the mean between the latest bid and asked prices. Short-term
obligations are valued at amortized cost, which approximates value. Foreign
securities held by the Fund are valued in U.S. dollars at the current exchange
rate.
B. INCOME TAXES -- The Portfolio is treated as a partnership for federal tax
purposes. No provision is made by the Portfolio for federal or state taxes on
any taxable income of the Portfolio because each investor in the Portfolio is
ultimately responsible for the payment of any taxes. Since some of the
Portfolio's investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolio, the Portfolio normally
must satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for its investors to satisfy them.
The Portfolio will allocate at least annually among its investors each
investors' distributive share of the Portfolio's net taxable (if any) and tax-
exempt investment income, net realized capital gains, and any other items of
income, gain, loss, deduction or credit.
C. DEFERRED ORGANIZATION EXPENSES -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line
basis over five years.
D. LEGAL FEES -- Legal fees and other related expenses incurred as part of
negotiations of the terms and requirements of capital infusions, or that are
expected to result in the restructuring of or a plan of reorganization for an
investment are added to the cost of the investment.
E. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Dividend income and distributions to
shareholders are recorded on the ex-dividend date and interest income is
recorded on the accrual basis.
F. INTERIM FINANCIAL INFORMATION -- The interim financial statements relating
to February 29, 1996 and for the six month period then ended have not been
audited by independent certified public accountants, but in the opinion of the
Fund's management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
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(2) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee is earned by Boston Management and Research (BMR), a
wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to the Portfolio. The fee
is based upon a percentage of average daily net assets. For the six months ended
February 29, 1996, the fee was equivalent to 0.625% of the Portfolio's average
net assets for such period and amounted to $433,594. Except as to Trustees of
the Portfolio who are not members of EVM's or BMR's organization, officers and
Trustees receive remuneration for their services to the Fund out of such
investment adviser fee. Investors Bank & Trust Company (IBT) serves as custodian
of the Portfolio. Prior to November 10, 1995, IBT was an affiliate of EVM.
Pursuant to the custodian agreement, IBT receives a fee reduced by credits which
are determined based on the average daily cash balances the Portfolio maintains
with IBT. Certain of the officers and Trustees of the Portfolio are officers and
directors/trustees of the above organizations. Trustees of the Portfolio that
are not affiliated with the Investment Adviser may elect to defer receipt of all
or a portion of their annual fees in accordance with the terms of the Trustees
Deferred Compensation Plan. For the six months ended February 29, 1996 no
significant amounts have been deferred.
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(3) PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of investments, other than short term obligations,
aggregated $43,499,277 and $51,664,802, respectively.
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(4) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investments
owned at February 29, 1996, as computed on a federal income tax basis, are as
follows:
Aggregate cost $105,880,599
============
Gross unrealized appreciation $ 39,771,279
Gross unrealized depreciation (501,826)
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Net unrealized appreciation $ 39,269,453
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(5) LINE OF CREDIT
The Portfolio participates with other portfolios and funds managed by BMR and
EVM and its affiliates in a $120 million unsecured line of credit agreement with
a bank. The line of credit consists of a $20 million committed facility and a
$100 million discretionary facility. Borrowings will be made by the Portfolio
solely to facilitate the handling of unusual and/or unanticipated short-term
cash requirements. Interest is charged to each portfolio based on its borrowings
at an amount above either the bank's adjusted certificate of deposit rate, a
variable adjusted certificate of deposit rate, or a federal funds effective
rate. In addition, a fee computed at an annual rate of 1/4 of 1% on the $20
million committed facility and on the daily unused portion of the $100 million
discretionary facility is allocated among the participating funds and portfolios
at the end of each quarter. The Portfolio did not have any significant
borrowings or allocated fees during the period. At February 29, 1996, the Fund
did not have an outstanding balance pursuant to the line of credit.
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INVESTMENT MANAGEMENT INDEPENDENT TRUSTEES
OFFICERS DONALD R. DWIGHT
President, Dwight Partners, Inc.
JAMES B. HAWKES Chairman, Newspapers of New England,
President, Trustee Inc.
M. DOZIER GARDNER SAMUEL L. HAYES, III
Vice President Jacob H. Schiff Professor of
Investment Banking,
PETER F. KIELY Harvard University Graduate School
Vice President and of Business Administration
Portfolio Manager
NORTON H. REAMER
JAMES L. O'CONNOR President and Director, United Asset
Treasurer Management Corporation
THOMAS OTIS JOHN L. THORNDIKE
Secretary Vice President and Director,
Fiduciary Company Incorporated
JACK L. TREYNOR
Investment Adviser and Consultant
