<PAGE>
MARTIN CURRIE BUSINESS TRUST
OPPORTUNISTIC EAFE FUND
ANNUAL REPORT
APRIL 30, 2000
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
PROFILE AT APRIL 30, 2000
OBJECTIVE Long-term capital appreciation through active management of a
diversified portfolio of international equities outside the USA
and Canada.
LAUNCH DATE July 1, 1994
FUND SIZE $261.8m
PERFORMANCE Total return from May 1, 1999 through April 30, 2000
SINCE LAUNCH
<TABLE>
<S> <C>
- MCBT - Opportunistic EAFE (excluding all transaction fees) +21.7%
- MCBT - Opportunistic EAFE (including all transaction fees) +19.8%
- The Morgan Stanley Capital International EAFE Index +14.2%
Annualized total return from July 1, 1994 through April 30, 2000
- MCBT - Opportunistic EAFE (excluding all transaction fees) +11.9%
- MCBT - Opportunistic EAFE (including all transaction fees) +11.6%
- The Morgan Stanley Capital International EAFE Index +10.0%
</TABLE>
<TABLE>
<CAPTION>
7/1/94 (a) 4/30/95 4/30/96 4/30/97 4/30/98 4/30/99 4/30/00
<S> <C> <C> <C> <C> <C> <C> <C>
MCBT Opportunistic EAFE $10,000 $9,710 $11,283 $11,718 $14,451 $15,595 $18,974
MSCI EAFE Index $10,000 $10,500 $11,729 $11,666 $13,906 $15,270 $17,434
</TABLE>
(a) Commencement of investment operations.
Performance shown is net of all fees after reimbursement from the Manager.
Returns and net asset values of fund investments will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost. The total returns would have been lower had certain expenses not been
waived during the period shown. Each performance figure including all
transaction fees assumes purchase at the beginning and redemption at the end of
the stated period and is calculated using an offering price which reflects a
transaction fee of 75 basis points on purchase and 75 basis points on
redemption. Transaction fees are paid to the Fund to cover trading costs. Past
performance is not indicative of future performance.
1
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
PROFILE AT APRIL 30, 2000
PORTFOLIO Over the twelve months to April 30, 2000, the MSCI EAFE index rose
COMMENTS by 14.2%. By comparison, our fund rose by 21.7%. This gives us a
Lipper ranking of 306 out of 648 funds, and the available
institutional peer group ranking places the fund in the second
quartile.
The major trends in our asset allocation over the last year have
been to overweight emerging markets and Japan, at the expense of
the UK and Europe. But recently we have started to rebalance the
portfolio. We are making a gradual switch from Japan back to
Europe, where we are buyers only on weakness. In Japan, we plan to
maintain a neutral position to the index. The market is defensive
and we are skeptical about the pace of reform, but recognize that
change is underway. Our position in emerging markets reflects both
a strong domestic economic recovery, and a play on world economic
momentum.
In recognition of the far-reaching changes, which the internet
will bring, our emphasis at sector level has been on technology,
media and telecommunications companies. The development of the
`e-economy' is still at an early stage, particularly in Japan and
Europe. We are also overweight to Asia, which has some of the most
attractively valued IT companies.
Currency management against the yen, over the year, has been
reasonably successful with most of the hedges profitable. But we
did not anticipate the extent of the euro's weakness, and while we
were underweight, in retrospect, a hedge would have been
appropriate.
In assessing overall returns, the main contributor to performance
was the quality of stock selection, particularly in Japan and
Europe.
OUTLOOK
Until investors are convinced that the pressures on the world
economy are under control, we anticipate that the current
volatility in world markets will continue. The direction of US
monetary policy and the need for an easing in the pace of economic
expansion provide the main focus. But the situation is finely
poised. Too severe a move in interest rates, or too negative a
reaction in the equity market, could precipitate a much harder
economic landing than desired and a more dramatic reaction from
world stock markets.
We continue to believe that the US economy will gradually ease
from its peak in late 1999, and that the inflation increases,
which have become evident, will dissipate gradually, as the year
unfolds. We remain enthusiastic about the outlook for markets for
the rest of the year, and retain a low overall cash position. In
currency markets, we are unhedged. We see the euro as a cheap
currency, and believe that the yen will remain within a fairly
narrow trading range.
2
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
PROFILE AT APRIL 30, 2000
INVESTMENT James Fairweather spent three years with Montague Loebl
MANAGER Stanley & Co as an institutional sales and economics assistant.
PROFILE He moved into Eurobond sales for 18 months with Kleinwort Benson
before joining Martin Currie in 1984. He has worked in our Far
East, North American and continental European investment teams.
Appointed a director in 1987, James became head of our continental
European team in 1992. Chairman of the international strategy
group, he was appointed deputy chief investment officer in 1994
with overall responsibility for our investments in emerging
markets. James was promoted to chief investment officer in 1997.
3
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
PROFILE AT APRIL 30, 2000
ASSET ALLOCATION
(% of net assets)
[PIE CHART]
<TABLE>
<CAPTION>
LARGEST HOLDINGS
BY REGION/COUNTRY % OF NET ASSETS
<S> <C> <C>
EUROPE
Vodaphone Group PLC (United Kingdom) 3.9
Nokia Oyi (Finland) 3.2
Telefonaktiebolaget L.M.
Ericsson, Cl B (Sweden) 3.1
VNU NV (Netherlands) 2.3
AXA (France) 2.3
JAPAN
NTT Mobile Communications 2.9
Rohm 2.1
LATIN AMERICA
Telefonos de Mexico SA, ADR (Mexico) 0.8
PACIFIC BASIN
China Telecom Limited (Hong Kong) 0.9
Samsung Electronics, GDR (South Korea) 0.9
OTHER AREAS
Indian Opportunities Fund (Investment Company) 0.6
</TABLE>
4
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
<S> <C> <C>
COMMON STOCKS- 95.4%
AFRICA - 0.2%
SOUTH AFRICA - 0.2%
NEDCOR INVESTMENT BANK HOLDINGS 14,500 $ 6,202
SOFTLINE LIMITED * 490,000 503,694
-----------------
TOTAL SOUTH AFRICA - (COST $844,705) 509,896
-----------------
TOTAL AFRICA - (COST $844,705) 509,896
-----------------
EUROPE - 54.6%
FINLAND - 3.7%
NOKIA OYJ 147,956 8,487,379
TIETOENATOR OYJ 24,408 1,176,034
-----------------
TOTAL FINLAND - (COST $3,577,613) 9,663,413
-----------------
FRANCE - 14.8%
ALCATEL 16,300 3,778,674
ALSTOM 45,429 1,132,019
AVENTIS SA 52,753 2,911,036
AXA 39,889 5,914,510
CAP GEMINI SA 15,652 3,073,514
CARREFOUR SA 41,850 2,724,082
FRANCE TELECOM SA 10,290 1,592,160
SOCIETE GENERALE 10,884 2,254,000
SODEXHO ALLIANCE SA 9,629 1,442,614
SUEZ LYONNAISE DES EAUX SA 15,368 2,410,006
TOTAL SA 38,509 5,842,924
VIVENDI 58,213 5,757,852
-----------------
TOTAL FRANCE - (COST $32,934,018) 38,833,391
-----------------
GERMANY - 1.7%
DEUTSCHE TELEKOM AG 40,943 2,657,227
SAP AG 2,861 1,686,707
-----------------
TOTAL GERMANY - (COST $4,383,456) 4,343,934
-----------------
GREECE - 0.1%
HELLENIC TELECOMMUNICATION ORGANIZATION SA (OTE) 9,600 216,112
-----------------
TOTAL GREECE - (COST $199,770) 216,112
-----------------
IRELAND - 0.0%
BANK OF IRELAND 990 6,678
-----------------
TOTAL IRELAND - (COST $10,084) 6,678
-----------------
ITALY - 4.7%
ALLEANZA ASSICURAZIONI 150,309 1,555,030
INSTITUTO BANCARIO SAO PAOLO DI TORINO 203,938 2,855,161
MEDIASET SPA 82,744 1,342,723
TELECOM ITALIA MOBILE 440,830 4,207,965
TELECOM ITALIA SPA 161,766 2,261,805
-----------------
TOTAL ITALY - (COST $10,858,995) 12,222,684
-----------------
</TABLE>
See notes to financials.
5
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
<S> <C> <C>
NETHERLANDS - 4.2%
ELSEVIER NV 303,972 $ 2,956,848
ING GROEP NV 37,213 2,030,497
VNU NV 110,864 5,931,283
-----------------
TOTAL NETHERLANDS - (COST $10,022,880) 10,918,628
-----------------
POLAND - 0.1%
TELEKOMUNIKACJA POLSKA SA 144A * 43,000 330,025
-----------------
TOTAL POLAND - (COST $214,205) 330,025
-----------------
SPAIN - 3.9%
AMADEUS GLOBAL TRAVEL DISTRIBUTION SA, SERIES A * 99,818 1,234,126
BANCO BILBAO VIZCAYA ARGENTARIA SA 173,768 2,369,587
BANCO SANTANDER CENTRAL HISPANO SA 231,205 2,410,862
TELEFONICA SA 193,736 4,311,550
-----------------
TOTAL SPAIN - (COST $8,912,457) 10,326,125
-----------------
SWEDEN - 4.4%
FORENINGSSPARBANKEN AB, SERIES A 129,000 1,899,175
SECURITAS AB, CL B 54,000 1,397,278
TELEFONAKTIEBOLAGET L.M. ERICSSON, CL B 92,000 8,178,006
-----------------
TOTAL SWEDEN - (COST $6,149,549) 11,474,459
-----------------
SWITZERLAND - 1.3%
HOLDERBANK FINANCIERE GLARUS AG 1,790 2,024,006
NOVARTIS 1,030 1,438,793
-----------------
TOTAL SWITZERLAND - (COST $3,756,156) 3,462,799
-----------------
UNITED KINGDOM - 15.7%
3i GROUP PLC 123,596 2,474,687
ALLIED ZURICH AG 90,000 895,402
ASTRAZENECA GROUP PLC 33,550 1,406,707
B.P. AMOCO PLC 216,000 1,864,791
BRITISH SKY BROADCASTING GROUP PLC 56,000 1,373,231
BRITISH TELECOMMUNICATIONS PLC 101,000 1,808,398
CABLE & WIRELESS PLC 125,050 2,075,467
GKN PLC 114,600 1,587,997
GLAXO WELLCOME PLC 96,080 2,969,398
HILTON GROUP PLC 303,140 1,274,330
HSBC HOLDINGS PLC 80,000 884,348
MARCONI PLC 186,050 2,314,469
RIO TINTO PLC 9,000 140,126
ROYAL BANK OF SCOTLAND GROUP PLC 50,009 780,173
SAGE GROUP PLC 220,000 2,450,796
SHELL TRANSPORT & TRADING PLC 191,180 1,566,425
SMITHKLINE BEECHAM PLC 136,000 1,863,359
SMITHS INDUSTRIES PLC 117,343 1,375,089
STAGECOACH HOLDINGS PLC 426,000 419,513
VODAFONE GROUP PLC 2,235,332 10,232,089
WPP GROUP PLC 81,000 1,305,270
-----------------
TOTAL UNITED KINGDOM - (COST $33,225,301) 41,062,065
-----------------
TOTAL EUROPE - (COST $114,244,484) 142,860,313
-----------------
</TABLE>
See notes to financials.
6
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
<S> <C> <C>
JAPAN - 27.6%
ASAHI CHEMICAL 236,000 $ 1,358,996
BENESSE CORPORATION 8,100 707,152
BENESSE CORPORATION * 8,100 740,897
BRIDGESTONE CORPORATION 78,000 1,693,376
CANON 90,000 4,116,095
DAIWA HOUSE INDUSTRY COMPANY LIMITED 122,000 813,220
FAMILYMART COMPANY 24,000 879,878
FUJI PHOTO FILM 34,000 1,362,959
FUJITSU LIMITED 87,000 2,464,658
HITACHI 201,000 2,400,500
HONDA MOTOR 41,000 1,833,356
ITO - YOKADO 28,000 2,045,272
KAO CORPORATION 119,000 3,624,589
MABUCHI MOTOR 12,700 1,399,158
MARUI 108,000 2,029,718
MITSUI MARINE AND FIRE INSURANCE COMPANY LIMITED 160,000 703,606
MKC-STAT CORPORATION 60,000 1,233,162
NAMCO LIMITED 32,000 1,306,485
NTT MOBILE COMMUNICATIONS 224 7,486,368
RISO KAGAKU 13,400 372,171
ROHM 16,700 5,596,815
SANWA INTERNATIONAL FINANCE, PREFERRED 144,000,000 1,363,144
SECOM COMPANY LIMITED 40,000 3,355,090
SHIN - ETSU CHEMICAL 89,950 4,755,029
SONY * 23,100 2,673,240
SONY 20,000 2,297,829
SUMITOMO BAKELITE COMPANY LIMITED 224,000 2,465,732
SUMITOMO ELECTRIC INDUSTRIES LIMITED 130,000 1,731,889
TAISHO PHARMACEUTICAL 50,000 1,675,693
TOPPAN PRINTING 230,000 2,406,147
TREND MICRO INCORPORATED 7,500 1,124,844
YAMANOUCHI PHARMACEUTICAL 81,000 4,281,905
-----------------
TOTAL JAPAN - (COST $45,410,159) 72,298,973
-----------------
LATIN AMERICA - 2.7%
BRAZIL - 1.1%
EMBRATEL PARTICIPACOES SA 52,000 1,170,000
PETROLEO BRASILIEIRO SA, ADR 37,000 888,000
UNIBANCO - UNIAO DE BANCOS BRASILEIROS SA, GDR 28,000 698,250
-----------------
TOTAL BRAZIL - (COST $2,600,450) 2,756,250
-----------------
MEXICO - 1.6%
WALMART DE MEXICO * 433,000 998,523
GRUPO FINANCIERO BANAMEX, CL B * 170,000 614,240
GRUPO TELEVISA SA, GDR * 15,000 951,562
TELEFONOS DE MEXICO SA, ADR 29,200 1,717,325
-----------------
TOTAL MEXICO - (COST $3,231,621) 4,281,650
-----------------
TOTAL LATIN AMERICA - (COST $5,832,071) 7,037,900
-----------------
</TABLE>
See notes to financials.
7
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE
------ -----
<S> <C> <C>
OTHER AREAS - 1.0%
INVESTMENT COMPANIES - 1.0%
INDIAN OPPORTUNITIES FUND (a) * 108,911 $ 1,661,982
NEAR EAST OPPORTUNITIES FUND (b) 52,000 973,960
-----------------
TOTAL INVESTMENT COMPANIES - (COST $2,114,283) 2,635,942
-----------------
TOTAL OTHER AREAS - (COST $2,114,283) 2,635,942
-----------------
PACIFIC BASIN - 9.3%
AUSTRALIA - 1.8%
AMP LIMITED 150,000 1,314,000
BRAMBLES INDUSTRIES LIMITED 53,500 1,505,961
NEWS CORPORATION LIMITED 65,000 825,478
NORTH LIMITED 530,000 911,536
-----------------
TOTAL AUSTRALIA - (COST $4,560,529) 4,556,975
-----------------
HONG KONG - 3.6%
BANK OF EAST ASIA LIMITED 680,000 1,471,011
CHINA TELECOM (HONG KONG) LIMITED * 328,000 2,347,609
HUTCHISON WHAMPOA 153,500 2,226,865
i-CABLE COMMUNICATIONS LIMITED * 600,000 261,901
LI & FUNG LIMITED 452,000 1,764,084
TELEVISION BROADCASTS LIMITED 200,000 1,367,278
-----------------
TOTAL HONG KONG - (COST $9,239,148) 9,438,748
-----------------
MALAYSIA - 0.6%
MALAYAN BANKING BERHAD 400,000 1,663,158
-----------------
TOTAL MALAYSIA - (COST $1,798,558) 1,663,158
-----------------
SINGAPORE - 1.8%
CHARTERED SEMICONDUCTOR MANUFACTURING, ADR * 21,500 1,878,562
NATSTEEL ELECTRONICS LIMITED 255,000 1,464,401
SINGAPORE TELECOMMUNICATIONS LIMITED 950,000 1,369,470
-----------------
TOTAL SINGAPORE - (COST $3,225,859) 4,712,433
-----------------
SOUTH KOREA - 0.9%
SAMSUNG ELECTRONICS 144A, GDR 14,400 2,320,920
-----------------
TOTAL SOUTH KOREA - (COST $2,150,795) 2,320,920
-----------------
TAIWAN - 0.5%
COMPAL ELECTRONICS INCORPORATED, GDR 97,045 1,361,053
-----------------
TOTAL TAIWAN - (COST $1,562,662) 1,361,053
-----------------
THAILAND - 0.1%
THAI PETROCHEMICAL INDUSTRY PUBLIC COMPANY LIMITED 1,440,000 351,819
-----------------
TOTAL THAILAND - (COST $756,173) 351,819
-----------------
TOTAL PACIFIC BASIN - (COST $23,293,724) 24,405,106
-----------------
</TABLE>
See notes to financials.
8
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 2000
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
------ -----
<S> <C> <C>
TOTAL COMMON STOCKS - (COST $191,739,426) + $ 249,748,130
-----------------
SHORT TERM INVESTMENT - 2.1%
STATE STREET BANK AND TRUST COMPANY , 5.250%, 05/01/2000 (c) $ 5,499,000 5,499,000
-----------------
TOTAL SHORT TERM INVESTMENT - (COST $5,499,000) 5,499,000
-----------------
TOTAL INVESTMENTS - (COST $197,238,426) - 97.5% 255,247,130
CASH, RECEIVABLES AND OTHER ASSETS, LESS LIABILITIES - 2.5% 6,524,134
-----------------
NET ASSETS - 100.0% $ 261,771,264
=================
</TABLE>
* Non-income producing security. 144A 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.
(a) The Indian Opportunities Fund is managed by Martin Currie Bermuda Ltd.,
an affiliate of Martin Currie Inc. Martin Currie Inc. does not receive
advisory fees on the portion of net assets represented by affiliated
investment companies.
(b) Martin Currie Investment Management Ltd., which is affiliated to Martin
Currie Inc., provides investment management services to the Near East
Opportunities Fund. Martin Currie Inc. does not receive advisory fees on
the portion of net assets represented by affiliated investment companies.
(c) The repurchase agreement, dated 4/28/2000, $5,499,000 par due 5/1/2000,
is collateralized by United States Treasury Bond, 8.875%, due 8/15/2017
with a market value of $5,612,494.
+ Percentages of long term investments are presented in the portfolio by
country. Percentages of long term investments by industry are as follows:
Aerospace 0.5%, Air Travel 0.5%, Automobiles 1.4%, Banks 6.0%,
Broadcasting 2.0%, Business Services 1.0%, Cement 0.8%, Chemicals 5.5%,
Commercial Services 1.1%, Computer Services 2.3%, Computer Software 2.0%,
Conglomerates 0.9%, Construction Materials 0.3%, Diversified 4.4%, Drugs
& Health Care 5.2%, Electrical Equipment 3.9%, Electronics 6.5%,
Financial Services 2.5%, Hotels & Restaurants 0.5%, Household Products
1.4%, Industrial Machinery 1.0%, Insurance 3.5%, Investment Companies
1.0%, Leisure 0.5%, Mining 0.4%, Oil & Gas 3.9%, Petroleum Services 0.1%,
Photography 2.1%, Publishing 4.6%, Retail 1.4%, Retail Trade 1.9%,
Semi-Conductor Manufacturing Equiptment 0.7%, Telecommunications 25.4%,
Transportation 0.2%.
ADR American Depositary Receipts.
GDR Global Depositary Receipts.
See notes to financials.
9
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2000
<TABLE>
<S> <C>
ASSETS
Investments in securities, at value (cost $191,739,426) (Note B) $ 249,748,130
Investments in repurchase agreements, at value (Note B) 5,499,000
-----------------
Total Investments 255,247,130
Cash 659
Foreign currency, at value (cost $6,191,907) (Note B) 6,191,907
Receivable for investments sold 4,192,042
Receivable for currency sold 3,563,295
Dividend and interest receivable 446,589
Foreign tax reclaims receivable 176,055
-----------------
TOTAL ASSETS 269,817,677
-----------------
LIABILITIES
Payable for investments purchased 3,932,283
Payable for currency purchased 3,530,950
Management fee payable (Note C) 474,443
Administration fee payable (Note C) 11,108
Trustees fees payable (Note C) 2,859
Accrued expenses and other liabilities 94,770
-----------------
TOTAL LIABILITIES 8,046,413
-----------------
TOTAL NET ASSETS $ 261,771,264
=================
COMPOSITION OF NET ASSETS:
Paid-in-capital $ 196,774,940
Undistributed net investment loss (509,029)
Accumulated net realized gain on investment and foreign currency transactions 7,493,557
Net unrealized appreciation on investment and foreign currency transactions 58,011,796
-----------------
TOTAL NET ASSETS $ 261,771,264
=================
NET ASSET VALUE PER SHARE $ 15.32
=================
($261,771,264 / 17,081,846 shares of beneficial interest outstanding)
</TABLE>
See notes to financials.
10
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
YEAR ENDED APRIL 30, 2000
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest income $ 401,921
Dividend income 4,360,440
Foreign taxes withheld (491,224)
-----------------
TOTAL INVESTMENT INCOME 4,271,137
-----------------
EXPENSES
Management fee (Note C) 1,638,996
Custodian fee 288,611
Administration fee (Note C) 164,100
Audit fee 28,582
Legal fees 14,040
Transfer agent fee 7,591
Trustees fees (Note C) 4,865
Amortization of deferred organization expenses (Note B) 439
Miscellaneous expenses 26,871
-----------------
TOTAL EXPENSES 2,174,095
-----------------
NET INVESTMENT INCOME 2,097,042
-----------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
Net realized gain on investments 16,730,859
Net realized loss on foreign currency transactions (1,192,568)
Net unrealized appreciation (depreciation) on:
Investments 26,413,501
Foreign currency transactions (466)
-----------------
NET GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 41,951,326
-----------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 44,048,368
=================
</TABLE>
See notes to financial statements.
11
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Year
Ended Ended
APRIL 30, 2000 APRIL 30, 1999
-------------- --------------
<S> <C> <C>
NET ASSETS at beginning of period $ 213,865,065 $ 159,362,284
--------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income 2,097,042 1,411,785
Net realized gain on investment transactions 16,730,859 11,196,185
Net realized gain (loss) on foreign currency transactions (1,192,568) 903,970
Net unrealized appreciation (depreciation) on:
Investments 26,413,501 1,056,622
Foreign currency transactions (466) 206,000
--------------- ---------------
Net increase in net assets from operations 44,048,368 14,774,562
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (3,243,286) (1,261,524)
In excess of net investment income (373,313) 0
Net realized gains (15,207,281) (8,700,165)
--------------- ---------------
Total distributions (18,823,880) (9,961,689)
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares 22,944,900 65,935,613
Reinvestment of dividends and distributions to shareholders 17,214,726 8,591,028
Cost of shares repurchased (17,779,094) (25,412,041)
Paid in capital from subscription and redemption fees 301,179 575,308
--------------- ---------------
Total increase (decrease) in net assets from capital share transactions 22,681,711 49,689,908
--------------- ---------------
NET INCREASE IN NET ASSETS 47,906,199 54,502,781
--------------- ---------------
NET ASSETS at end of period (includes undistributed net investment
Income (loss) of $(509,029) and $1,146,244, respectively) $ 261,771,264 $ 213,865,065
=============== ===============
OTHER INFORMATION:
CAPITAL SHARE TRANSACTIONS:
Shares sold 1,446,234 5,165,192
Shares issued in reinvestment of distributions to shareholders 1,051,602 667,005
Less shares repurchased (1,268,466) (1,952,430)
--------------- ---------------
Net share transactions 1,229,370 3,879,767
=============== ===============
</TABLE>
See notes to financials.
12
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING FOR THE PERIOD
<TABLE>
<CAPTION>
Year Year Year Year Year
Ended Ended Ended Ended Ended
APRIL 30, 2000 APRIL 30, 1999 APRIL 30, 1998 APRIL 30, 1997 APRIL 30, 1996
-------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING
PERFORMANCE
Net asset value, beginning of period $ 13.490 $ 13.310 $ 11.320 $ 11.250 $ 9.860
---------- ----------- ----------- ----------- -----------
Net investment income 0.101 0.192 0.095 0.134 0.314
Net realized and unrealized gain(loss) on
investment and foreign currency
transactions 2.889 0.786 2.462 0.286 1.239
---------- ----------- ----------- ----------- -----------
Total from investment operations 2.990 0.978 2.557 0.420 1.553
---------- ----------- ----------- ----------- -----------
Less distributions:
Net investment income (0.203) (0.106) (0.153) (0.229) (0.167)
In excess of net investment income (0.023) 0.000 0.000 (0.127) (0.023)
Net realized gains (0.952) (0.728) (0.422) 0.000 0.000
---------- ----------- ----------- ----------- -----------
Total distributions (1.178) (0.834) (0.575) (0.356) (0.190)
---------- ----------- ----------- ----------- -----------
Paid in capital from subscription and
redemption fees (Note B) 0.018 0.036 0.008 0.006 0.027
---------- ----------- ----------- ----------- -----------
Net asset value, end of period $ 15.320 $ 13.490 $ 13.310 $ 11.320 $ 11.250
========== =========== =========== =========== ===========
TOTAL INVESTMENT RETURN (1) 21.66% 7.92% 23.33% 3.85% 16.17%
------------------------ ========== =========== =========== =========== ===========
RATIOS AND SUPPLEMENTAL DATA
----------------------------
Net assets, end of period $261,771,264 $213,865,065 $159,362,284 $120,649,807 $108,295,237
Operating expenses, net, to average
net assets (Note C) 0.92% 0.96% 0.96% 0.98% 1.00%
Operating expenses, gross, to average
net assets (Note C) 0.92% 0.96% 0.96% 0.98% 1.05%
Net investment income to average net assets 0.89% 0.85% 1.08% 0.90% 1.46%
Portfolio turnover rate 71% 82% 63% 49% 37%
Per share amount of fees waived (Note C) $ 0.000 $ 0.000 $ 0.000 $ 0.000 $ 0.012
---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Total return at net asset value assuming all distributions reinvested and
no purchase premiums or redemption fees. Total return would have been lower
had certain expenses not been waived.
See notes to financials.
13
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
NOTE A - ORGANIZATION
Martin Currie Business Trust ("MCBT") (the "Trust") is registered under the
Investment Company Act of 1940, as amended (the 1940 Act), as an open-end
management investment company organized as a Massachusetts business trust on May
20, 1994. The Trust offers five funds which have differing investment objectives
and policies: Opportunistic EAFE Fund, Global Emerging Markets Fund, Japan Small
Companies Fund, Asia Pacific ex Japan Fund (formerly "Emerging Asia Fund") and
EMEA Fund, (the "Funds"). The MCBT Opportunistic EAFE Fund (the "Fund")
commenced investment operations on July 1, 1994. The Fund's Declaration of Trust
permits the Board of Trustees to issue an unlimited number of full and
fractional shares of beneficial interest, without par value.
NOTE B - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Fund in the preparation of its financial statements.
VALUATION OF INVESTMENTS - The Fund's portfolio securities traded on a
securities exchange are valued at the last quoted sale price, or, if no sale
occurs, at the mean of the most recent quoted bid and asked prices. Unlisted
securities for which market quotations are readily available are valued at the
mean of the most recent quoted bid and asked prices. Prices for securities which
are primarily traded in foreign markets are furnished by quotation services
expressed in the local currency's value and are translated into U.S. dollars at
the current rate of exchange. Short-term securities and debt securities with a
remaining maturity of 60 days or less are valued at their amortized cost.
Options and futures contracts are valued at the last sale price on the market
where such options or futures contract is principally traded. Options traded
over-the-counter are valued based upon prices provided by market makers in such
securities or dealers in such currencies. Securities for which current market
quotations are unavailable or for which quotations are not deemed by the
investment adviser to be representative of market values are valued at fair
value as determined in good faith by the Trustees of the Fund, or by persons
acting pursuant to procedures established by the Trustees.
REPURCHASE AGREEMENTS - In connection with transactions in repurchase
agreements, the Fund's custodian takes possession of the underlying collateral
securities, the value or market price of which is at least equal to the
principal amount, including interest, of the repurchase transaction. To the
extent that any repurchase transaction exceeds one business day, the value of
the collateral is marked-to-market on a daily basis to ensure the adequacy of
the collateral. In the event of default of the obligation to repurchase, the
Fund has the right to liquidate the collateral and apply the proceeds in
satisfaction of the obligation. Under certain circumstances, in the event of
default or bankruptcy by the other party to the agreement, realization and/or
retention of the collateral or proceeds may be subject to legal proceedings that
could delay or increase the cost of such realization or retention.
INVESTMENT TRANSACTIONS - Investment security transactions are recorded on the
date of purchase or sale. Realized gains and losses from security transactions
are determined on the basis of identified cost.
INVESTMENT INCOME - Dividend income is recorded on the ex-dividend date.
Interest income is accrued as earned. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
FOREIGN CURRENCY TRANSLATIONS - The records of the Fund are maintained in U.S.
dollars. Foreign currency amounts are translated into U.S. dollars at a current
rate of exchange of such currency to determine the value of investments, other
assets and liabilities on the date of any determination of net asset value of
the Fund. Purchases and sales of securities and income and expenses are
converted at the prevailing rate of exchange on the respective dates of such
transactions.
The Fund may realize currency gains or losses between the trade and settlement
dates on security transactions. To minimize such currency gains or losses, the
Fund may enter into forward foreign currency contracts.
14
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
FOREIGN CURRENCY TRANSLATIONS (CONTINUED) - The net U.S. dollar value of foreign
currency underlying all contractual commitments held by the Fund on each day and
the resulting net unrealized appreciation, depreciation and related net
receivable or payable amounts are determined by using forward currency exchange
rates supplied by a quotation service.
Reported net realized gains and losses on foreign currency transactions
represent net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, currency gains and losses realized
between the trade and settlement dates on security transactions, and the
difference between the amount of net investment income accrued and the U.S.
dollar amount actually received. The effects of changes in foreign currency
exchange rates on investments in securities are not segregated in the Statement
of Operations from the effects of changes in market prices of those securities,
and are included with the net realized and unrealized gain or loss on investment
securities.
FORWARD FOREIGN CURRENCY CONTRACTS - A forward foreign currency contract
("Forward") is an agreement between two parties to buy and sell a currency at a
set price on a future date. The market value of the Forward fluctuates with
changes in currency exchange rates. The Forward is marked-to-market daily and
the change in the market value is recorded by the Fund as an unrealized gain or
loss. When the Forward is closed, the Fund records a realized gain or loss equal
to the difference between the value at the time it was opened and the value at
the time it was closed. The Fund may enter into Forwards in connection with
planned purchases and sales of securities, to hedge specific receivables or
payables against changes in future exchange rates or to hedge the U.S. dollar
value of portfolio securities denominated in a foreign currency. There were no
open forward foreign currency contracts at April 30, 2000.
Although forward currency contracts limit the risk of loss due to a decline in
the value of hedged currency, they also limit any potential gain that might
result should the value of the currency increase. In addition, the Funds could
be exposed to additional risks if the counterparties to the contracts are unable
to meet the terms of their contracts.
EXPENSES - Expenses directly attributable to the Fund are charged to the Fund.
Expenses not directly attributable to a particular Fund are either split evenly
among the affected Funds, allocated on the basis of relative average net assets,
or otherwise allocated among the Funds as the Board of Trustees may direct or
approve. Certain costs incurred in connection with the organization of the Trust
and each Fund were deferred and were being amortized on a straight line basis
over a five year period starting on each Fund's commencement of operations.
DISTRIBUTIONS TO SHAREHOLDERS - The Fund declares and distributes dividends from
net investment income, if any, and distributes its net realized capital gains,
if any, at least annually. All distributions will be reinvested in shares of the
Fund at the net asset value unless the shareholder elects in the subscription
agreement either to receive cash in respect of all distributions or to receive
cash with respect to distributions of income and to reinvest in shares of the
Fund with respect to distributions of realized capital gains. Income and capital
gain distributions are determined in accordance with income tax regulations
which may differ from generally accepted accounting principles. These
differences are primarily due to differing treatments for passive foreign
investment companies (PFIC's), foreign currency transactions, losses deferred
due to wash sales, post October 31 losses and excise tax regulations. Permanent
book and tax differences relating to shareholder distributions will result in
reclassifications to paid-in-capital. Distributions are recorded on the
ex-dividend date.
15
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
PURCHASES AND REDEMPTIONS OF FUND SHARES - There is a purchase premium for cash
investments into the Fund of 0.75% of the amount invested and a redemption fee
on cash redemptions of 0.75% of the amount redeemed. All purchase premiums and
redemption fees are paid to and retained by the Fund and are recorded as
paid-in-capital by the Fund. These fees are intended to offset brokerage and
transaction costs arising in connection with the purchase and redemption. The
purchase and redemption fees may be waived by the Manager, however, if these
brokerage and transaction costs are minimal or in other circumstances at the
Manager's discretion. For the year ended April 30, 2000, $173,387 was collected
in purchase premiums and $127,792 was collected in redemption fees.
INCOME TAXES - Each Fund of the Trust is treated as a separate entity for U.S.
federal income tax purposes. Each Fund intends to qualify each year as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended. By so qualifying, the Funds will not be subject to federal
income taxes to the extent that they distribute substantially all of their
taxable income, including realized capital gains, if any, for the fiscal year.
In addition, by distributing substantially all of their net investment income,
realized capital gains and certain other amounts, if any, during the calendar
year, the Funds will not be subject to a federal excise tax.
The Fund may be subject to taxes imposed by countries in which it invests. Such
taxes are generally based on income and/or capital gains earned or repatriated.
Taxes are accrued and applied to net investment income, net realized gains and
unrealized appreciation as such income and/or gains are earned.
ESTIMATES - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
income and expenses at the date of the financial statements. Actual results
could differ from these estimates.
NOTE C - AGREEMENTS AND FEES
The Fund has entered into a Management Contract with Martin Currie Inc. (the
"Investment Manager"), a wholly owned subsidiary of Martin Currie Ltd. Under the
Management Contract, the Fund pays the Investment Manager a quarterly management
fee at the annual rate of 0.70% of the Fund's average net assets.
The Investment Manager has voluntarily undertaken to reduce its fee until
further notice to the extent necessary to limit the Fund's annual expenses
(including the management fee but excluding brokerage commissions, transfer
taxes, and extraordinary expenses) to 1.00% of the Fund's average net assets on
an annualized basis. For the year ended April 30, 2000, it was not necessary for
the Investment Manager to waive any of its fees.
State Street Bank and Trust Company (the "Administrator") serves as
administrator of the Fund. The Administrator performs certain administrative
services for the Fund. The Fund pays the Administrator a fee at the rate of
0.08% of the Fund's average net assets up to $125 million, 0.06% of the next
$125 million, and 0.04% of those assets in excess of $250 million, subject to
certain minimum requirements, plus certain out of pocket costs. State Street
Bank and Trust Company also receives fees and compensation of expenses for
certain custodian and transfer agent services.
Trustees of the Trust who are not interested persons receive aggregate annual
fees of $20,000 ($10,000 per Trustee).
16
<PAGE>
MCBT OPPORTUNISTIC EAFE FUND
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE D - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
short-term securities for the year ended April 30, 2000 were $162,379,316 and
$166,215,047, respectively.
The identified cost of investments in securities and repurchase agreements owned
for federal income tax purposes and their respective gross unrealized
appreciation and depreciation at April 30, 2000 were as follows:
<TABLE>
<CAPTION>
IDENTIFIED GROSS UNREALIZED NET UNREALIZED
COST APPRECIATION (DEPRECIATION) APPRECIATION
------------ ----------- -------------- ---------------
<S> <C> <C> <C> <C>
$198,512,317 $67,742,961 $(11,008,148) $56,734,813
</TABLE>
NOTE E - PRINCIPAL SHAREHOLDERS
As of April 30, 2000 there was one shareholder who owned greater than 10% of the
Fund's outstanding shares, representing 20% of the Fund.
NOTE F - CONCENTRATION OF RISK
The Fund will invest extensively in foreign securities (i.e., those which are
not listed on a United States securities exchange). Investing in foreign
securities involves risks not typically found in investing in U.S. markets.
These include risks of adverse change in foreign economic, political, regulatory
and other conditions, and changes in currency exchange rates, exchange control
regulations (including currency blockage), expropriation of assets or
nationalization, imposition of withholding taxes on dividend or interest
payments and capital gains, and possible difficulty in obtaining and enforcing
judgments against foreign entities. Furthermore, issuers of foreign securities
are subject to different, and often less comprehensive, accounting, reporting
and disclosure requirements than domestic issuers. The securities of some
foreign companies and foreign securities markets are less liquid and at times
more volatile than securities of comparable U.S. companies and U.S. securities
markets.
--------------------------------------------------------------------------------
ADDITIONAL FEDERAL TAX INFORMATION - (UNAUDITED)
The Fund intends to make an election under Internal Revenue Code 853 to pass
through foreign taxes paid by the Fund to its shareholders. During the year
ended April 30, 2000, the total amount of foreign taxes that will be passed
through to the shareholders and the foreign source income for information
reporting purposes will be $491,224 (of the total $491,224 taxes withheld) and
$4,163,241, respectively. On December 30, 1999, the Fund declared a long term
capital gain distribution of $14,844,646, representing $0.929266 per share.
17
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of the
Martin Currie Business Trust - Opportunistic EAFE Fund
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Opportunistic EAFE Fund (the
"Fund") at April 30, 2000, and the results of its operations, the changes in its
net assets and the financial highlights for the periods indicated, in conformity
with accounting principles generally accepted in the United States. These
financial statements and the financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States, which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included confirmation
of securities at April 30, 2000 by correspondence with the custodian and
brokers, provide a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Boston, Massachusetts
June 23, 2000
18
<PAGE>
MARTIN CURRIE BUSINESS TRUST
--------------------
TRUSTEES AND OFFICERS
C. James P. Dawnay, TRUSTEE AND PRESIDENT *
Simon D. Eccles, TRUSTEE
Patrick R. Wilmerding, TRUSTEE
Colin Winchester, VICE PRESIDENT AND TREASURER
J. Grant Wilson, VICE PRESIDENT
Julian M.C. Livingston, CLERK
* INTERESTED TRUSTEE
--------------------
INVESTMENT MANAGER
Martin Currie, Inc.
Saltire Court
20 Castle Terrace
Edinburgh EH1 2ES
Scotland
011-44-131-229-5252
Regulated by IMRO
Registered Investment Adviser with the SEC
--------------------
--------------------------------------------------------------------------------
The information contained in this report is intended for general
informational purposes only. This report is not authorized for distribution
to prospective investors unless preceded or accompanied by a current Private
Placement Memorandum which contains important information concerning the Fund
and its current offering of shares.
--------------------------------------------------------------------------------
