-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BrGE7B14/WrIm45KnX6YZ7VKeAqnIbYYDTr2Qfd91sJvWSvseek1tKJPJRscOQTI DDoTp493WS2Fp9O550iUQQ== 0000912057-02-039597.txt : 20021024 0000912057-02-039597.hdr.sgml : 20021024 20021024140059 ACCESSION NUMBER: 0000912057-02-039597 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020831 FILED AS OF DATE: 20021024 EFFECTIVENESS DATE: 20021024 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EATON VANCE GROWTH TRUST CENTRAL INDEX KEY: 0000102816 IRS NUMBER: 042325690 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-01241 FILM NUMBER: 02797119 BUSINESS ADDRESS: STREET 1: 24 FEDERAL ST CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174828260 MAIL ADDRESS: STREET 1: 24 FEDERAL ST STREET 2: 11TH FLOOR CITY: BOSTON STATE: MA ZIP: 02210 FORMER COMPANY: FORMER CONFORMED NAME: BOSTON STOCK FUND INC DATE OF NAME CHANGE: 19730619 FORMER COMPANY: FORMER CONFORMED NAME: VANCE SANDERS COMMON STOCK FUND INC DATE OF NAME CHANGE: 19820915 FORMER COMPANY: FORMER CONFORMED NAME: EATON VANCE GROWTH FUND INC DATE OF NAME CHANGE: 19920703 N-30D 1 a2090727zn-30d.txt N-30D [EV LOGO] [PHOTO OF FIBER OPTIC WIRE] ANNUAL REPORT AUGUST 31, 2002 [PHOTO OF GLOBE] EATON VANCE INFORMATION AGE FUND [PHOTO OF SATELLITE DISH] IMPORTANT NOTICE REGARDING DELIVERY OF SHAREHOLDER DOCUMENTS The Securities and Exchange Commission (SEC) permits mutual funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called "householding" and it helps eliminate duplicate mailings to shareholders. EATON VANCE, OR YOUR FINANCIAL ADVISER, MAY HOUSEHOLD THE MAILING OF YOUR DOCUMENTS INDEFINITELY UNLESS YOU INSTRUCT EATON VANCE, OR YOUR FINANCIAL ADVISER, OTHERWISE. If you would prefer that your Eaton Vance documents not be householded, please contact Eaton Vance at 1-800-262-1122, or contact your financial adviser. Your instructions that householding not apply to delivery of your Eaton Vance documents will be effective within 30 days of receipt by Eaton Vance or your financial adviser. EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 LETTER TO SHAREHOLDERS [PHOTO OF THOMAS E. FAUST, JR.] Thomas E. Faust, Jr. President Eaton Vance Information Age Fund Class A shares had a total return of -18.33% during the year ended August 31, 2002. That return was the result of a decrease in net asset value per share (NAV) from $13.64 on August 31, 2001 to $11.14 on August 31, 2002.(1) Class B shares had a total return of -18.98% for the same period, the result of a decrease in NAV from $13.91 to $11.27.(1) Class C shares had a total return of -18.88% for the same period, the result of a decrease in NAV from $13.40 to $10.87.(1) Class D shares had a total return of -18.99% for the same period, the result of a decrease in NAV from $8.32 to $6.74.(1) By comparison, the Morgan Stanley Capital International World Index had a return of -17.20% for the one-year period ended August 31, 2002.(2) ENCOURAGING ECONOMIC NEWS, COUPLED WITH ONGOING UNCERTAINTY ... To date, 2002 has seen a disconnect between improving U.S. economic conditions and sinking stock markets. Domestic equity markets have been very weak so far this year, as high stock valuations, geopolitical uncertainties, the collapse of the tech/telecom investment bubble, and a crisis of confidence in American business and financial institutions all contributed to the decline. In contrast, international equity markets generally posted better performances than their U.S. counterparts during the first half of 2002. However, several key market indexes, feeling the impact of the weak U.S. economy, corporate accounting scandals, and global political tension, ended the period in negative territory, including indexes in Hong Kong and the United Kingdom. AMID UNCERTAINTY, OPPORTUNITIES FOR GROWTH ... The past year has presented us with an enormously challenging investment environment, one we can be sure will continue for the foreseeable future. Yet we feel confident that the opportunities we've seen in the development of the information age remain in place, and that our team is well positioned to seek out further opportunities on a global basis going forward. In the pages that follow, co-portfolio managers Martha Locke and Jacob Rees-Mogg review the past year and look ahead to the coming year. Sincerely, /s/ Thomas E. Faust, Jr. Thomas E. Faust, Jr. President September 30, 2002 FUND INFORMATION AS OF AUGUST 31, 2002
PERFORMANCE(1) CLASS A CLASS B CLASS C CLASS D - ------------------------------------------------------------------------------------------------------ AVERAGE ANNUAL TOTAL RETURNS (AT NET ASSET VALUE) - ------------------------------------------------------------------------------------------------------ One Year -18.33% -18.98% -18.88% -18.99% Five Years 4.22 3.72 3.68 N.A. Life of Fund+ 7.43 7.00 6.51 -23.40 SEC AVERAGE ANNUAL TOTAL RETURNS (INCLUDING SALES CHARGE OR APPLICABLE CDSC) - ------------------------------------------------------------------------------------------------------ One Year -23.01% -23.03% -19.69% -23.04% Five Years 2.99 3.40 3.68 N.A. Life of Fund+ 6.52 7.00 6.51 -26.01
+ Inception Dates - Class A: 9/18/95; Class B: 9/18/95; Class C:11/22/95; Class D:3/9/01
TEN LARGEST HOLDINGS(3) - ---------------------------------------------- Sindo Ricoh Co. 3.7% Sony Corp. 2.5 Trinity Mirror PLC 2.3 Pearson PLC 2.3 West Australia Newspapers Holdings Ltd. 2.3 Promotora de Informaciones S.A. 2.1 Samsung Electronics 1.9 St. Ives PLC 1.9 Fuji Photo Film Co., Ltd. 1.8 Dun & Bradstreet Corp. 1.8
(1) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested. SEC returns for Class A reflect the maximum 5.75% sales charge. SEC returns for Class B and Class D reflect applicable CDSC based on the following schedule: 5% - 1st and 2nd years; 4% - 3rd year; 3% - 4th year; 2% - 5th year; 1% - 6th year. SEC 1-Year return for Class C reflects 1% CDSC. (2) It is not possible to invest directly in an Index. (3) Ten largest holdings accounted for 22.6% of the Portfolio's net assets. Holdings are subject to change. Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. MUTUAL FUND SHARES ARE NOT INSURED BY THE FDIC AND ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL INVESTED. 2 MANAGEMENT DISCUSSION AN INTERVIEW WITH MARTHA LOCKE AND HON. JACOB REES-MOGG, CO-PORTFOLIO MANAGERS OF INFORMATION AGE PORTFOLIO [PHOTO OF MARTHA LOCKE] Martha Locke Co-Portfolio Manager [PHOTO OF HON. JACOB REES-MOGG] Hon. Jacob Rees-Mogg Co-Portfolio Manager Q: How would you summarize the Fund's performance this year? A: MS. LOCKE: Once again, it was a very difficult environment for equity investing, one in which most risk-taking was unrewarded. After the initial shock to the market from the 9/11 terrorist attacks and subsequent market rebound, the reality of slowing economic activity set in and has continued for the rest of the year. The fallout from the bursting of the technology and telecommunications "bubble" continued. Virtually any exposure at all to telecom or technology proved unsuccessful, even in situations where valuations had already declined. Biotech was another area that proved punishing. Also, the US market became increasingly risk-averse as more stories of corporate abuse unfolded, which tended to feed on more pessimism about earnings and valuations. As a result, we've become somewhat more defensive, focusing on companies with strong market positions in industries whose earnings and cash flow tend to be somewhat less volatile. Publishing stocks - especially newspapers - have proved remarkably resilient. Another area of focus is business and information services. Many of these companies have leading market positions in activities that are necessary to conduct business, even in periods of slower economic growth - for instance, credit and debt rating services, document storage, customer acquisition and management services, etc. Our exposure to advertising-based media has also helped offset some of the technology and telecom declines. There was a period of several months of strength in the stocks, which gave way in the summer when the whole market declined precipitously; however, many of these same stocks have regained much of that lost ground as their earnings turnaround becomes more apparent. Finally, we increased our exposure to the defense industry, a process which began over a year ago and which was reinforced after the 9/11 attacks. Many defense companies have very sophisticated communications, information systems and avionics businesses, areas in which the US government is spending significantly. There are few areas of visible growth in the economy, but this certainly was one of them. Q: What factors accounted for the Fund's returns on the international side? A: MR. REES-MOGG: This was a difficult background in which to be investing internationally as well. Telecom stocks were weak, as the level of over-investment became clear to investors. Excess capacity in the industry is not being met with sufficient growth in demand. Consequently, that sector has been extremely weak, and any exposure to it has been a negative for performance. Technology was also disappointing. Earnings shrank across the board, owing to customers' reduced budgets resulting from the general economic squeeze. A similar attitude reduced advertising budgets, so that media stocks declined. GEOGRAPHIC DISTRIBUTION+ As a percentage of investments [CHART] U.S. 55.0% U.K. 15.3% Japan 8.6% Other Asia 10.2% Other Europe 8.6% Australia 2.3%
+ Geographic distribution subject to change due to active management. 3 Many had additional pressures from their internet investments, which often needed restructuring and write-offs. So, this was an atmosphere in which international diversification offered little safe harbor; generally speaking, markets were equally hard hit across the globe. Q: Given this difficult investment environment, how does the investment approach of theFund remain relevant? Are there good opportunities available among Information Age stocks? A: MS. LOCKE: Clearly, the investment environment has changed drastically in the past two or three years. "Concept" stocks are thoroughly discredited, and the IPO market has all but dried up. There is now more market focus on company fundamentals such as revenue growth, free cash flow generation and leverage. In fact, this plays to the strengths of Information Age Fund, which seeks to control risks through fundamentals-based research and through industry and market diversification. The Fund draws on the expertise of two research teams, one US and one international, which provide investment ideas to the fund managers. With roughly half the assets in the US and half international, the Fund also continues to be diversified across many sectors and industry groups. In this regard it is not a tech/telecom fund, but more broadly based in its interpretation of "information age" stocks. We continue to believe that the explosion of information, made available through the declining cost of computing and storage, creates numerous opportunities for those companies involved in its creation, processing and distribution. Competition is always increasing, and those companies that can harness the changes made possible through information can improve their productivity and achieve long-term competitive advantage. Our "information age" companies are those that are helping to drive that process. This is not just a phenomenon of the US; it is truly global. Once the world economies get through the current economic slump, we believe the trends of privatization and globalization will resume, further driving the demand for information-based processes and capabilities. Q: What are your expectations going forward? A: MR. REES-MOGG: Our efforts at diversification and fundamental research will remain critical, perhaps more so than ever, in this challenging market environment. For instance, this year we found some growth opportunities in non-Japan Asian markets, especially in Korea. This was a result of our research teams' search for moderately valued companies with strong balance sheets and good dividend yields. This will continue to be the focus of our investments until the current bear phase has ended. MS. LOCKE: We look for continued volatility in the market given all the economic and political uncertainties before us. There is as yet no clarity about corporate and consumer spending in the year ahead, as confidence remains quite shaky not only because of economic factors but also because of the possibility of war in the Middle East. Nevertheless, we believe that market volatility often presents us with opportunities to purchase at a reasonable price the shares of strong companies we believe are temporarily experiencing a disruption in their growth. While this period of great uncertainty persists, we will continue to focus on companies with good balance sheets and strong market positions, selling at reasonable valuations. FIVE LARGEST INDUSTRY POSITIONS+ As a percentage of total net assets [CHART] Publishing 20.0% Broadcasting 10.9% Commercial Services & Supplies 7.3% Aerospace & Defense 5.1% Diversified Telecommunications Services 4.2%
+ Industry positions subject to change due to active management. 4 [CHART] COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EATON VANCE INFORMATION AGE FUND CLASS A VS THE MSCI WORLD INDEX* September 30, 1995 - August 31, 2002
EATON VANCE INFORMATION AGE FUND EATON VANCE INFORMATION AGE CLASS A AT NAV CLASS A WITH SALES CHARGE MSCI WORLD INDEX - ---------------------------------------------------------------------------------------------------------------------- 9/30/95 10000 10000 10000 10/31/95 10137.93 9554.32 9844.41 11/30/95 10236.46 9647.17 10188.1 12/31/95 10295.57 9702.88 10487.87 1/31/96 10334.98 9740.02 10679.46 2/29/96 10561.58 9953.57 10746.47 3/31/96 10581.28 9972.14 10927.26 4/30/96 11142.86 10501.39 11186.19 5/31/96 11359.61 10705.66 11197.87 6/30/96 11192.12 10547.82 11256.5 7/31/96 10502.47 9897.86 10860.73 8/31/96 10896.56 10269.27 10987.64 9/30/96 11546.8 10882.08 11419.88 10/31/96 11320.2 10668.52 11501.66 11/30/96 11842.37 11160.63 12148.25 12/31/96 11715.49 11041.05 11955.75 1/31/97 11922.58 11236.22 12101.89 2/28/97 11932.44 11245.51 12243.15 3/31/97 11518.26 10855.17 12003.09 4/30/97 11616.87 10948.11 12397.53 5/31/97 12563.58 11840.31 13164.96 6/30/97 13027.07 12277.12 13823.7 7/31/97 13648.34 12862.63 14462.45 8/31/97 13186.42 12427.3 13497.1 9/30/97 13869.42 13070.99 14232.51 10/31/97 13142.35 12385.77 13485.61 11/30/97 13483.85 12707.62 13726.39 12/31/97 13733.84 12943.21 13895.83 1/31/98 13895.15 13095.23 14285.27 2/28/98 15070.36 14202.79 15253.89 3/31/98 15922.96 15006.31 15900.33 4/30/98 15969.06 15049.74 16058.08 5/31/98 15715.57 14810.86 15859.19 6/30/98 16015.14 15093.18 16237.88 7/31/98 15865.35 14952.02 16214.17 8/31/98 13491.89 12715.19 14054.31 9/30/98 14091.01 13279.82 14305.3 10/31/98 14436.67 13605.58 15601 11/30/98 15323.83 14441.67 16531.22 12/31/98 16782.08 15815.97 17341.33 1/31/99 17830.96 16804.47 17723.46 2/28/99 17155.82 16168.2 17254.44 3/31/99 17975.63 16940.82 17975.39 4/30/99 19084.79 17986.13 18686.5 5/31/99 18795.44 17713.44 18006.2 6/30/99 20736.47 19542.73 18848.56 7/31/99 21375.45 20144.91 18794.63 8/31/99 20905.26 19701.79 18763.89 9/30/99 21496.01 20258.54 18584.47 10/31/99 22935.9 21615.55 19553.05 11/30/99 26208.61 24699.86 20105.67 12/31/99 30699.73 28932.43 21735.6 1/31/00 30329.85 28583.85 20493.35 2/29/00 33453.25 31527.44 20551.17 3/31/00 33699.84 31759.83 21974.2 4/30/00 30795.62 29022.8 21047.59 5/31/00 29370.91 27680.11 20517.31 6/30/00 30549.04 28790.42 21211.01 7/31/00 28494.17 26853.84 20616.5 8/31/00 29918.88 28196.53 21289.73 9/30/00 28631.16 26982.94 20160.2 10/31/00 27590.03 26001.75 19824.94 11/30/00 25028.29 23587.48 18623.87 12/31/00 25410.13 23947.33 18927.78 1/31/01 26239.67 24729.12 19295.4 2/28/01 23911.14 22534.63 17666.86 3/31/01 21146 19928.68 16509.81 4/30/01 22528.57 21231.66 17734.26 5/31/01 22353.93 21067.07 17514 6/30/01 21568.05 20326.43 16967.75 7/31/01 20898.6 19695.52 16744.31 8/31/01 19850.76 18708 15943.85 9/30/01 17755.07 16732.96 14541.05 10/31/01 18308.1 17254.15 14821.04 11/30/01 19777.99 18639.42 15700.09 12/31/01 20083.61 18927.45 15800.7 1/31/02 19239.52 18131.94 15323.72 2/28/02 19239.52 18131.94 15193.49 3/31/02 20301.91 19133.18 15868.34 4/30/02 19545.14 18429.97 15335.26 5/31/02 19632.46 18502.26 15370.81 6/30/02 17769.63 16746.67 14441.35 7/31/02 16183.31 15251.68 13225.88 8/31/02 16212.42 15279.11 13253.38
[CHART] COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EATON VANCE INFORMATION AGE FUND CLASS B VS THE MSCI WORLD INDEX* September 30, 1995 - August 31, 2002
EATON VANCE INFORMATION AGE FUND CLASS B AT NAV MSCI WORLD INDEX - ----------------------------------------------------------------------------------- 9/30/95 10000 10000 10/31/95 10127.95 9844.41 11/30/95 10226.38 10188.1 12/31/95 10285.43 10487.87 1/31/96 10314.96 10679.46 2/29/96 10541.34 10746.47 3/31/96 10570.87 10927.26 4/30/96 11112.21 11186.19 5/31/96 11328.74 11197.87 6/30/96 11161.42 11256.5 7/31/96 10482.28 10860.73 8/31/96 10866.14 10987.64 9/30/96 11515.75 11419.88 10/31/96 11289.37 11501.66 11/30/96 11811.02 12148.25 12/31/96 11685.27 11955.75 1/31/97 11892.17 12101.89 2/28/97 11902.03 12243.15 3/31/97 11478.36 12003.09 4/30/97 11567.03 12397.53 5/31/97 12512.89 13164.96 6/30/97 12966.11 13823.7 7/31/97 13586.83 14462.46 8/31/97 13125.65 13497.1 9/30/97 13808.05 14232.51 10/31/97 13083 13485.61 11/30/97 13413.54 13726.39 12/31/97 13655.15 13895.83 1/31/98 13811.08 14285.27 2/28/98 14991.71 15253.89 3/31/98 15827.06 15900.33 4/30/98 15871.61 16058.08 5/31/98 15626.57 15859.19 6/30/98 15916.16 16237.88 7/31/98 15760.23 16214.17 8/31/98 13398.98 14054.31 9/30/98 13989.29 14305.3 10/31/98 14323.43 15601 11/30/98 15203.33 16531.22 12/31/98 16646.74 17341.33 1/31/99 17682.8 17723.46 2/28/99 17007.62 17254.44 3/31/99 17822.49 17975.39 4/30/99 18905.11 18686.5 5/31/99 18614.09 18006.2 6/30/99 20534.87 18848.56 7/31/99 21151.84 18794.63 8/31/99 20686.2 18763.89 9/30/99 21256.61 18584.47 10/31/99 22670.78 19553.05 11/30/99 25963.17 20105.67 12/31/99 30389.11 21735.6 1/31/00 30006.94 20493.35 2/29/00 33103.84 20551.17 3/31/00 33314.69 21974.2 4/30/00 30428.65 21047.59 5/31/00 29005.39 20517.31 6/30/00 30165.08 21211.01 7/31/00 28122.45 20616.5 8/31/00 29492.99 21289.73 9/30/00 28201.52 20160.2 10/31/00 27173.61 19824.94 11/30/00 24630.21 18623.87 12/31/00 24983.31 18927.78 1/31/01 25766.23 19295.4 2/28/01 23487.39 17666.86 3/31/01 20775.16 16509.81 4/30/01 22117.29 17734.26 5/31/01 21935.55 17514 6/30/01 21152.63 16967.75 7/31/01 20495.54 16744.31 8/31/01 19447 15943.85 9/30/01 17391.85 14541.05 10/31/01 17909.14 14821.04 11/30/01 19335.16 15700.09 12/31/01 19628.75 15800.7 1/31/02 18789.91 15323.72 2/28/02 18775.93 15193.49 3/31/02 19810.5 15868.34 4/30/02 19055.54 15335.26 5/31/02 19125.45 15370.81 6/30/02 17307.97 14441.35 7/31/02 15742.14 13225.88 8/31/02 15756.12 13253.38
PERFORMANCE+ CLASS A CLASS B CLASS C CLASS D - ------------------------------------------------------------------------------------------ AVERAGE ANNUAL TOTAL RETURNS (AT NET ASSET VALUE) - ------------------------------------------------------------------------------------------ One Year -18.33% -18.98% -18.88% -18.99% Five Years 4.22 3.72 3.68 N.A. Life of Fund++ 7.43 7.00 6.51 -23.40 SEC AVERAGE ANNUAL TOTAL RETURNS (INCLUDING SALES CHARGE OR APPLICABLE CDSC) - ------------------------------------------------------------------------------------------ One Year -23.01% -23.03% -19.69% -23.04% Five Years 2.99 3.40 3.68 N.A. Life of Fund++ 6.52 7.00 6.51 -26.01
++ Inception Dates - Class A: 9/18/95; Class B: 9/18/95; Class C:11/22/95; Class D:3/9/01 * Source: TowersData Systems, Bethesda, MD. Investment operations commenced 9/18/95. Index information is available only at month-end; therefore, the line comparison begins at the next month-end following the commencement of the Fund's investment operations. The chart compares the total return of the Fund's Class A and Bshares with that of a broad-based securities market Index. Returns are calculated by determining the percentage change in net asset value with all distributions reinvested. The lines on the chart represent the total returns of $10,000 hypothetical investments in the Fund and the Morgan Stanley Capital International (MSCI) World Index - a broad-based index of global common stocks. An investment in the Fund's Class C shares on 11/22/95 at net asset value would have grown to $15,334 on August 31, 2002. An investment in the Fund's Class D shares on 3/9/01 at net asset value would be worth $6,740 on August 31, 2002; $6,403 with the applicable CDSC. Past performance does not predict future performance. The graph and performance table do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The Index's total returns do not reflect any commissions or expenses that would have been incurred if an investor individually purchased or sold the securities represented in them. It is not possible to invest directly in an Index. + Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested. SEC returns for Class A reflect the maximum 5.75% sales charge. SEC returns for Class B and Class D reflect applicable CDSC based on the following schedule: 5% - 1st and 2nd years; 4% - 3rd year; 3% - 4th year; 2% - 5th year; 1% - 6th year. SEC 1-Year return for Class C reflects 1% CDSC. Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. 5 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES
AS OF AUGUST 31, 2002 Assets - ------------------------------------------------------ Investment in Information Age Portfolio, at value (identified cost, $117,084,562) $109,376,982 Receivable for Fund shares sold 62,869 Receivable from affiliate for reimbursement of expenses 104,217 Prepaid expenses 8,465 Tax reclaim receivable 52,630 - ------------------------------------------------------ TOTAL ASSETS $109,605,163 - ------------------------------------------------------ Liabilities - ------------------------------------------------------ Payable for Fund shares redeemed $ 247,003 Payable to affiliate for service fees 27,122 Accrued expenses 103,609 - ------------------------------------------------------ TOTAL LIABILITIES $ 377,734 - ------------------------------------------------------ NET ASSETS $109,227,429 - ------------------------------------------------------ Sources of Net Assets - ------------------------------------------------------ Paid-in capital $182,660,599 Accumulated net realized loss from Portfolio (computed on the basis of identified cost) (65,310,063) Accumulated net investment loss (418,721) Net unrealized appreciation 3,194 Net unrealized depreciation from Portfolio (computed on the basis of identified cost) (7,707,580) - ------------------------------------------------------ TOTAL $109,227,429 - ------------------------------------------------------ Class A Shares - ------------------------------------------------------ NET ASSETS $ 35,502,219 SHARES OUTSTANDING 3,187,633 NET ASSET VALUE AND REDEMPTION PRICE PER SHARE (net assets DIVIDED BY shares of beneficial interest outstanding) $ 11.14 MAXIMUM OFFERING PRICE PER SHARE (100 DIVIDED BY 94.25 of $11.14) $ 11.82 - ------------------------------------------------------ Class B Shares - ------------------------------------------------------ NET ASSETS $ 55,897,856 SHARES OUTSTANDING 4,959,151 NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE (NOTE 6) (net assets DIVIDED BY shares of beneficial interest outstanding) $ 11.27 - ------------------------------------------------------ Class C Shares - ------------------------------------------------------ NET ASSETS $ 17,063,659 SHARES OUTSTANDING 1,570,430 NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE (NOTE 6) (net assets DIVIDED BY shares of beneficial interest outstanding) $ 10.87 - ------------------------------------------------------ Class D Shares - ------------------------------------------------------ NET ASSETS $ 763,695 SHARES OUTSTANDING 113,292 NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE (NOTE 6) (net assets DIVIDED BY shares of beneficial interest outstanding) $ 6.74 - ------------------------------------------------------
On sales of $50,000 or more, the offering price of Class A shares is reduced. STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2002 Investment Income - ------------------------------------------------------ Dividends allocated from Portfolio (net of foreign taxes, $179,386) $ 1,566,866 Interest allocated from Portfolio 224,537 Expenses allocated from Portfolio (1,672,506) - ------------------------------------------------------ NET INVESTMENT INCOME FROM PORTFOLIO $ 118,897 - ------------------------------------------------------ Expenses - ------------------------------------------------------ Management fee $ 362,246 Trustees' fees and expenses 3,114 Distribution and service fees Class A 225,790 Class B 748,256 Class C 241,934 Class D 7,190 Transfer and dividend disbursing agent fees 295,971 Registration fees 60,085 Legal and accounting services 32,648 Printing and postage 26,870 Custodian fee 22,887 Miscellaneous 12,304 - ------------------------------------------------------ TOTAL EXPENSES $ 2,039,295 - ------------------------------------------------------ Deduct -- Reimbursement of Class A distribution and service fees $ 104,217 - ------------------------------------------------------ TOTAL EXPENSE REDUCTIONS $ 104,217 - ------------------------------------------------------ NET EXPENSES $ 1,935,078 - ------------------------------------------------------ NET INVESTMENT LOSS $ (1,816,181) - ------------------------------------------------------ Realized and Unrealized Gain (Loss) - ------------------------------------------------------ Net realized gain (loss) from Portfolio-- Investment transactions (identified cost basis) $(29,576,532) Foreign currency and forward foreign currency exchange contract transactions (449,069) - ------------------------------------------------------ NET REALIZED LOSS $(30,025,601) - ------------------------------------------------------ Change in unrealized appreciation (depreciation) -- Investments from Portfolio (identified cost basis) $ 3,845,222 Foreign currency and forward foreign currency exchange contacts from Portfolio 4,674 Foreign currency and forward foreign currency exchange contracts 3,194 - ------------------------------------------------------ NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 3,853,090 - ------------------------------------------------------ NET REALIZED AND UNREALIZED LOSS $(26,172,511) - ------------------------------------------------------ NET DECREASE IN NET ASSETS FROM OPERATIONS $(27,988,692) - ------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 6 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) YEAR ENDED YEAR ENDED IN NET ASSETS AUGUST 31, 2002 AUGUST 31, 2001 - -------------------------------------------------------------------------- From operations -- Net investment loss $ (1,816,181) $ (2,619,686) Net realized loss (30,025,601) (39,234,022) Net change in unrealized appreciation (depreciation) 3,853,090 (46,528,067) - -------------------------------------------------------------------------- NET DECREASE IN NET ASSETS FROM OPERATIONS $ (27,988,692) $ (88,381,775) - -------------------------------------------------------------------------- Distributions to shareholders -- From net realized gain Class A $ -- $ (3,904,178) Class B -- (7,587,280) Class C -- (2,216,595) - -------------------------------------------------------------------------- TOTAL DISTRIBUTIONS TO SHAREHOLDERS $ -- $ (13,708,053) - -------------------------------------------------------------------------- Transactions in shares of beneficial interest -- Proceeds from sale of shares Class A $ 49,237,607 $ 77,755,718 Class B 4,381,313 17,760,711 Class C 3,544,065 16,942,404 Class D 546,282 588,748 Net asset value of shares issued to shareholders in payment of distributions declared Class A -- 3,611,101 Class B -- 7,001,891 Class C -- 2,053,464 Cost of shares redeemed Class A (54,577,997) (72,129,345) Class B (20,926,404) (29,101,620) Class C (9,232,260) (15,918,013) Class D (76,531) (79,307) - -------------------------------------------------------------------------- NET INCREASE (DECREASE) IN NET ASSETS FROM FUND SHARE TRANSACTIONS $ (27,103,925) $ 8,485,752 - -------------------------------------------------------------------------- NET DECREASE IN NET ASSETS $ (55,092,617) $ (93,604,076) - -------------------------------------------------------------------------- Net Assets - -------------------------------------------------------------------------- At beginning of year $ 164,320,046 $ 257,924,122 - -------------------------------------------------------------------------- AT END OF YEAR $ 109,227,429 $ 164,320,046 - -------------------------------------------------------------------------- Accumulated net investment loss included in net assets - -------------------------------------------------------------------------- AT END OF YEAR $ (418,721) $ -- - --------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 7 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS A -------------------------------------------------------------------- YEAR ENDED AUGUST 31, -------------------------------------------------------------------- 2002(1) 2001(1) 2000(1) 1999(1) 1998 - ------------------------------------------------------------------------------------------------------ Net asset value -- Beginning of year $13.640 $21.840 $17.340 $11.710 $11.970 - ------------------------------------------------------------------------------------------------------ Income (loss) from operations - ------------------------------------------------------------------------------------------------------ Net investment loss $(0.098) $(0.132) $(0.213) $(0.217) $(0.156) Net realized and unrealized gain (loss) (2.402) (6.935) 6.939 6.469 0.431 - ------------------------------------------------------------------------------------------------------ TOTAL INCOME (LOSS) FROM OPERATIONS $(2.500) $(7.067) $ 6.726 $ 6.252 $ 0.275 - ------------------------------------------------------------------------------------------------------ Less distributions - ------------------------------------------------------------------------------------------------------ From net realized gain $ -- $(1.133) $(2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ TOTAL DISTRIBUTIONS $ -- $(1.133) $(2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ NET ASSET VALUE -- END OF YEAR $11.140 $13.640 $21.840 $17.340 $11.710 - ------------------------------------------------------------------------------------------------------ TOTAL RETURN(2) (18.33)% (33.65)% 43.12% 54.95% 2.32% - ------------------------------------------------------------------------------------------------------ Ratios/Supplemental Data+ - ------------------------------------------------------------------------------------------------------ Net assets, end of year (000's omitted) $35,502 $49,231 $68,208 $20,908 $12,263 Ratios (As a percentage of average daily net assets): Net expenses(3) 1.99% 1.99% 1.99% 2.46% 2.68% Net investment loss (0.76)% (0.78)% (0.98)% (1.47)% (1.20)% Portfolio Turnover of the Portfolio 107% 160% 173% 131% 157% - ------------------------------------------------------------------------------------------------------ + The expenses of the Fund reflect a reimbursement of Class A distribution and service fees. Had such action not been taken, the ratios and net investment loss per share would have been as follows: Ratios (As a percentage of average daily net assets): Expenses(3) 2.22% 2.14% 2.12% Net investment loss (0.99)% (0.93)% (1.11)% Net investment loss per share $(0.128) $(0.156) $(0.241) - ------------------------------------------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at the net asset value on the last day of each period reported. Dividends and distributions, if any, are assumed reinvested at the net asset value on the reinvestment date. Total return is not computed on an annualized basis. (3) Includes the Fund's share of the Portfolio's allocated expenses. SEE NOTES TO FINANCIAL STATEMENTS 8 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS B -------------------------------------------------------------------- YEAR ENDED AUGUST 31, -------------------------------------------------------------------- 2002(1) 2001(1) 2000(1) 1999(1) 1998 - ------------------------------------------------------------------------------------------------------ Net asset value -- Beginning of year $13.910 $22.380 $ 17.770 $12.030 $12.310 - ------------------------------------------------------------------------------------------------------ Income (loss) from operations - ------------------------------------------------------------------------------------------------------ Net investment loss $(0.195) $(0.249) $ (0.353) $(0.284) $(0.210) Net realized and unrealized gain (loss) (2.445) (7.088) 7.189 6.646 0.465 - ------------------------------------------------------------------------------------------------------ TOTAL INCOME (LOSS) FROM OPERATIONS $(2.640) $(7.337) $ 6.836 $ 6.362 $ 0.255 - ------------------------------------------------------------------------------------------------------ Less distributions - ------------------------------------------------------------------------------------------------------ From net realized gain $ -- $(1.133) $ (2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ TOTAL DISTRIBUTIONS $ -- $(1.133) $ (2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ NET ASSET VALUE -- END OF YEAR $11.270 $13.910 $ 22.380 $17.770 $12.030 - ------------------------------------------------------------------------------------------------------ TOTAL RETURN(2) (18.98)% (34.06)% 42.58% 54.39% 2.08% - ------------------------------------------------------------------------------------------------------ Ratios/Supplemental Data - ------------------------------------------------------------------------------------------------------ Net assets, end of year (000's omitted) $55,898 $87,092 $148,603 $49,963 $30,331 Ratios (As a percentage of average daily net assets): Net expenses(3) 2.72% 2.64% 2.59% 2.87% 3.12% Net investment loss (1.48)% (1.44)% (1.59)% (1.88)% (1.64)% Portfolio Turnover of the Portfolio 107% 160% 173% 131% 157% - ------------------------------------------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at the net asset value on the last day of each period reported. Dividends and distributions, if any, are assumed reinvested at the net asset value on the reinvestment date. Total return is not computed on an annualized basis. (3) Includes the Fund's share of the Portfolio's allocated expenses. SEE NOTES TO FINANCIAL STATEMENTS 9 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS C -------------------------------------------------------------------- YEAR ENDED AUGUST 31, -------------------------------------------------------------------- 2002(1) 2001(1) 2000(1) 1999(1) 1998 - ------------------------------------------------------------------------------------------------------ Net asset value -- Beginning of year $13.400 $21.610 $17.280 $11.720 $12.020 - ------------------------------------------------------------------------------------------------------ Income (loss) from operations - ------------------------------------------------------------------------------------------------------ Net investment loss $(0.187) $(0.238) $(0.342) $(0.290) $(0.205) Net realized and unrealized gain (loss) (2.343) (6.839) 6.898 6.472 0.440 - ------------------------------------------------------------------------------------------------------ TOTAL INCOME (LOSS) FROM OPERATIONS $(2.530) $(7.077) $ 6.556 $ 6.182 $ 0.235 - ------------------------------------------------------------------------------------------------------ Less distributions - ------------------------------------------------------------------------------------------------------ From net realized gain $ -- $(1.133) $(2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ TOTAL DISTRIBUTIONS $ -- $(1.133) $(2.226) $(0.622) $(0.535) - ------------------------------------------------------------------------------------------------------ NET ASSET VALUE -- END OF YEAR $10.870 $13.400 $21.610 $17.280 $11.720 - ------------------------------------------------------------------------------------------------------ TOTAL RETURN(2) (18.88)% (34.07)% 42.42% 54.29% 1.96% - ------------------------------------------------------------------------------------------------------ Ratios/Supplemental Data - ------------------------------------------------------------------------------------------------------ Net assets, end of year (000's omitted) $17,064 $27,527 $41,113 $ 6,118 $ 2,531 Ratios (As a percentage of average daily net assets): Net expenses(3) 2.72% 2.64% 2.60% 2.93% 3.20% Net investment loss (1.47)% (1.44)% (1.57)% (1.94)% (1.72)% Portfolio Turnover of the Portfolio 107% 160% 173% 131% 157% - ------------------------------------------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at the net asset value on the last day of each period reported. Dividends and distributions, if any, are assumed reinvested at the net asset value on the reinvestment date. Total return is not computed on an annualized basis. (3) Includes the Fund's share of the Portfolio's allocated expenses. SEE NOTES TO FINANCIAL STATEMENTS 10 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS D --------------------------------- YEAR ENDED AUGUST 31, --------------------------------- 2002(1) 2001(1)(2) - ------------------------------------------------------------------- Net asset value -- Beginning of year $ 8.320 $10.000 - ------------------------------------------------------------------- Income (loss) from operations - ------------------------------------------------------------------- Net investment loss $(0.112) $(0.059) Net realized and unrealized loss (1.468) (1.621) - ------------------------------------------------------------------- TOTAL LOSS FROM OPERATIONS $(1.580) $(1.680) - ------------------------------------------------------------------- NET ASSET VALUE -- END OF YEAR $ 6.740 $ 8.320 - ------------------------------------------------------------------- TOTAL RETURN(3) (18.99)% (16.80)% - ------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------- Net assets, end of year (000's omitted) $ 764 $ 469 Ratios (As a percentage of average daily net assets): Net expenses(4) 2.72% 2.62%(5) Net investment loss (1.44)% (1.37)%(5) Portfolio Turnover of the Portfolio 107% 160% - -------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) For the period from start of business, March 9, 2001, to August 31, 2001. (3) Total return is calculated assuming a purchase at the net asset value on the first day and a sale at the net asset value on the last day of each period reported. Dividends and distributions, if any, are assumed reinvested at the net asset value on the reinvestment date. Total return is not computed on an annualized basis. (4) Includes the Fund's share of the Portfolio's allocated expenses. (5) Annualized. SEE NOTES TO FINANCIAL STATEMENTS 11 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS 1 Significant Accounting Policies - ------------------------------------------- Eaton Vance Information Age Fund (the Fund) is a diversified series of Eaton Vance Growth Trust (the Trust). The Trust is an entity of the type commonly known as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund offers four classes of shares. Class A shares are generally sold subject to a sales charge imposed at time of purchase. Class B, Class C and Class D shares are sold at the net asset value and are subject to a contingent deferred sales charge (see Note 6). Each class represents a pro rata interest in the Fund, but votes separately on class-specific matters and (as noted below) is subject to different expenses. Realized and unrealized gains and losses and net investment income, other than class-specific expenses, are allocated daily to each class of shares based on the relative net assets of each class to the total net assets of the Fund. Each class of shares differs in its distribution plan and certain other class-specific expenses. The Fund invests all of its investable assets in interests in Information Age Portfolio (the Portfolio), a New York Trust, having the same investment objective as the Fund. The value of the Fund's investment in the Portfolio reflects the Fund's proportionate interest in the net assets of the Portfolio (99.8% at August 31, 2002). The performance of the Fund is directly affected by the performance of the Portfolio. The financial statements of the Portfolio, including the portfolio of investments, are included elsewhere in this report and should be read in conjunction with the Fund's financial statements. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America. A Investment Valuation -- Valuation of securities by the Portfolio is discussed in Note 1A of the Portfolio's Notes to Financial Statements which are included elsewhere in this report. B Income -- The Fund's net investment income or loss consists of the Fund's pro rata share of the net investment income of the Portfolio, less all actual and accrued expenses of the Fund determined in accordance with accounting principles generally accepted in the United States of America. C Federal Taxes -- The Fund's policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders each year all of its net investment income, if any, and any net realized capital gains. Accordingly, no provision for federal income or excise tax is necessary. At August 31, 2002, the Fund, for federal income tax purposes, had a capital loss carryover of $49,971,606 which will reduce the Fund's taxable income arising from future net realized gain on investment transactions, if any, to the extent permitted by the Internal Revenue Code and thus will reduce the amount of distributions to shareholders which would otherwise be necessary to relieve the Fund of any liability for federal income tax. The capital loss carryovers will expire as follows: $2,886,540 on August 31, 2009 and $47,085,066 on August 31, 2010. At August 31, 2002 net capital losses of $15,254,901 attributable to security transactions incurred after October 31, 2001 and net currency losses of $418,721 attributable to foreign currency transactions incurred after October 31, 2001 are treated as arising on the first day of the Fund's next taxable year. D Expense Reduction -- Investors Bank & Trust Company (IBT) serves as custodian to the Fund and the Portfolio. Pursuant to the respective custodian agreements, IBT receives a fee reduced by credits which are determined based on the average daily cash balances the Fund or the Portfolio maintains with IBT. There were no credit balances used to reduce the Fund's custodian fees for the year ended August 31, 2002. E Use of Estimates -- The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates. 2 Distributions to Shareholders - ------------------------------------------- It is the present policy of the Fund to make at least one distribution annually (normally in December) of all or substantially all of the investment income allocated to the Fund by the Portfolio, less the Fund's direct and allocated expenses and at least one distribution annually of all or substantially all of the net realized capital gains (reduced by any available capital loss carryforwards from prior years) allocated by the Portfolio to the Fund, if any. Shareholders may reinvest all distributions in shares of the Fund at the per share net asset value as of the close of business on the record date. 12 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS CONT'D The Fund distinguishes between distributions on a tax basis and a financial reporting basis. Accounting principles generally accepted in the United States of America require that only distributions in excess of tax basis earnings and profits be reported in the financial statements as a return of capital. Permanent differences between book and tax accounting relating to distributions are reclassified to paid-in capital. These differences primarily relate to net operating losses and realized losses on in-kind withdrawals allocated from the Portfolio. 3 Management Fee and Other Transactions with Affiliates - ------------------------------------------- The management fee is earned by Eaton Vance Management (EVM) as compensation for management and administration of the business affairs of the Fund. The fee is based on a percentage of average daily net assets. For the year ended August 31, 2002, the fee was equivalent to 0.25% of the Fund's average net assets for such period and amounted to $362,246. Except as to Trustees of the Fund who are not members of EVM's organization, officers and Trustees receive remuneration for their services to the Fund out of such management fee. Effective August 1, 2002, EVM serves as the sub-transfer agent of the Fund and receives an aggregate fee based upon the actual expenses incurred by EVM in the performance of those services. Certain officers and Trustees of the Fund and of the Portfolio are officers of the above organization. In addition, investment adviser and administrative fees are paid by the Portfolio to EVM and its affiliates. See Note 2 of the Portfolio's Notes to Financial Statements which are included elsewhere in this report. The Fund was informed that Eaton Vance Distributors, Inc. (EVD), a subsidiary of EVM and the Fund's principal underwriter, received $8,957 from the Fund as its portion of the sales charge on sales of Class A shares for the year ended August 31, 2002. 4 Shares of Beneficial Interest - ------------------------------------------- The Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest (without par value). Such shares may be issued in a number of different series (such as the Fund) and classes. Transactions in Fund shares were as follows:
YEAR ENDED AUGUST 31, -------------------------- CLASS A 2002 2001 -------------------------------------------------------------------- Sales 3,697,562 4,367,477 Issued to shareholders electing to receive payments of distributions in Fund shares -- 198,740 Redemptions (4,118,925) (4,080,219) -------------------------------------------------------------------- NET INCREASE (DECREASE) (421,363) 485,998 --------------------------------------------------------------------
YEAR ENDED AUGUST 31, -------------------------- CLASS B 2002 2001 -------------------------------------------------------------------- Sales 327,834 966,243 Issued to shareholders electing to receive payments of distributions in Fund shares -- 376,604 Redemptions (1,630,333) (1,721,275) -------------------------------------------------------------------- NET DECREASE (1,302,499) (378,428) --------------------------------------------------------------------
YEAR ENDED AUGUST 31, -------------------------- CLASS C 2002 2001 -------------------------------------------------------------------- Sales 272,807 962,493 Issued to shareholders electing to receive payments of distributions in Fund shares -- 114,527 Redemptions (756,133) (926,063) -------------------------------------------------------------------- NET INCREASE (DECREASE) (483,326) 150,957 --------------------------------------------------------------------
YEAR ENDED AUGUST 31, -------------------------- CLASS D 2002 2001(1) -------------------------------------------------------------------- Sales 66,651 64,919 Redemptions (9,746) (8,532) -------------------------------------------------------------------- NET INCREASE 56,905 56,387 --------------------------------------------------------------------
(1) For the period from the commencement of offering of Class D shares, March 9, 2001, to August 31, 2001. 5 Distribution and Service Plans - ------------------------------------------- The Fund has in effect distribution plans for Class A shares (Class A Plan), Class B shares (Class B Plan), Class C shares (Class C Plan), and Class D shares (Class D Plan) pursuant to Rule 12b-1 under the Investment Company Act of 1940. The Class A Plan provides for the payment of a monthly distribution fee to the Principal Underwriter, EVD, in an amount equal to the aggregate of (a) 0.50% of that portion 13 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS CONT'D of the Fund's average daily net assets attributable to Class A shares which have remained outstanding for less than one year and (b) 0.25% of that portion of the Fund's average daily net assets attributable to Class A shares which have remained outstanding for more than one year. The Class B, Class C and Class D Plans provide for the payment of a monthly distribution fee to EVD at an annual rate not to exceed 0.75% of the Fund's average daily net assets attributable to Class B, Class C, and Class D shares for providing ongoing distribution services and facilities to the Fund. The Fund will automatically discontinue payments to EVD during any period in which there are no outstanding Uncovered Distribution Charges, which are equivalent to the sum of (i) 5%, 6.25%, and 5% of the aggregate amount received by the Fund for the Class B, Class C and Class D shares sold, respectively, plus (ii) interest calculated by applying the rate of 1% over the prevailing prime rate to the outstanding balance of Uncovered Distribution Charges of EVD of each respective class reduced by the aggregate amount of contingent deferred sales charges (see Note 6) and daily amounts therefore paid to EVD by each respective class. The Fund paid or accrued $148,750, $561,190, $181,451 and $5,395, for Class A, Class B, Class C and Class D shares, respectively, to or payable to EVD for the year ended August 31, 2002, representing 0.33%, 0.75%, 0.75% and 0.75% of the average daily net assets for Class A, Class B, Class C and Class D shares, respectively. At August 31, 2002, the amount of Uncovered Distribution Charges of EVD calculated under the Plans was approximately $2,812,000, $2,601,000 and $45,000 for Class B, Class C and Class D shares, respectively. The Plans authorize the Fund to make payments of service fees to EVD, investment dealers, and other persons in an amount equal to 0.25%, on an annual basis, of the Fund's average daily net assets attributable to Class A shares which have remained outstanding for more than one year and in an amount equal to 0.25%, on an annual basis, of the Fund's average daily net assets attributable to Class B, Class C and Class D shares for any fiscal year. Service fee payments are made for personal services and/or the maintenance of shareholder accounts. Service fees are separate and distinct from the sales commissions and distribution fees payable by the Fund to EVD, and, as such are not subject to automatic discontinuance when there are no outstanding Uncovered Distribution Charges of EVD. Service fee payments for the year ended August 31, 2002 amounted to $77,040, $187,066, $60,483 and $1,795 for Class A, Class B, Class C and Class D shares, respectively. For the year ended August 31, 2002, EVM reimbursed Class A distribution and service fees to the extent that annual operating expenses for Class A exceeded 1.99%. Such reimbursement for the year ended August 31, 2002 totaled $104,217. Certain officers and Trustees of the Fund are officers or directors of EVD. 6 Contingent Deferred Sales Charge - ------------------------------------------- A contingent deferred sales charge (CDSC) generally is imposed on redemptions of Class B shares and Class D shares made within six years of purchase and on redemptions of Class C shares made within one year of purchase. Class A shares purchased at net asset value in amounts of $1 million but less than $5 million are subject to a 1.00% CDSC if redeemed within one year of purchase. Investors who purchase Class A shares in a single fund purchased in a single transaction at net asset value in amounts of $5 million or more will not be subject to any CDSC for such investment or any subsequent investment in the same fund. Generally, the CDSC is based upon the lower of the net asset value at date of redemption or date of purchase. No charge is levied on shares acquired by reinvestment of dividends or capital gains distributions. The Class B and Class D CDSC is imposed at declining rates that begin at 5% in the case of redemptions in the first and second year after purchase, declining one percentage point each subsequent year. Class C shares will be subject to a 1% CDSC if redeemed within twelve months of purchase. No CDSC is levied on shares which have been sold to EVM or its affiliates or to their respective employees or clients and may be waived under certain other limited conditions. CDSC charges are paid to EVD to reduce the amount of Uncovered Distribution Charges calculated under the Fund's Distribution Plan (see Note 5). CDSC charges received when no Uncovered Distribution Charges exist will be credited to the Fund. The Fund was informed that EVD received approximately $770,000, $3,000 and $4,000 of CDSC paid by shareholders for Class B shares, Class C shares and Class D shares, respectively, for the year ended August 31, 2002. 7 Investment Transactions - ------------------------------------------- Increases and decreases in the Fund's investment in the Portfolio aggregated $57,806,282 and $88,513,245, respectively, for the year ended August 31, 2002. 14 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 INDEPENDENT ACCOUNTANTS' REPORT TO THE TRUSTEES AND SHAREHOLDERS OF EATON VANCE INFORMATION AGE FUND: - --------------------------------------------- In our opinion, the accompanying statement of assets and liabilities, 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 Eaton Vance Information Age Fund (the "Fund") at August 31, 2002, 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 of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, 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 provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Boston, Massachusetts October 4 , 2002 15 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 PORTFOLIO OF INVESTMENTS COMMON STOCKS -- 93.1%
SECURITY SHARES VALUE - ----------------------------------------------------------------------------- Advertising -- 2.6% - ----------------------------------------------------------------------------- Cheil Communication, Inc.(1) 12,750 $ 1,272,976 Getty Images, Inc.(2) 86,300 1,555,126 - ----------------------------------------------------------------------------- $ 2,828,102 - ----------------------------------------------------------------------------- Aerospace and Defense -- 5.1% - ----------------------------------------------------------------------------- General Dynamics Corp. 23,800 $ 1,871,632 Lockheed Martin Corp. 20,500 1,298,060 Northrop Grumman Corp. 15,800 1,940,240 Raytheon Company 14,500 507,500 - ----------------------------------------------------------------------------- $ 5,617,432 - ----------------------------------------------------------------------------- Broadcasting -- 10.9% - ----------------------------------------------------------------------------- Clear Channel Communications, Inc.(2) 29,900 $ 1,021,982 Cumulus Media, Inc., Class A(2) 76,900 1,073,524 Granada PLC(1) 989,690 1,225,513 Lin TV Corp., Class A(2) 50,400 1,181,880 Nippon Television Network Corp.(1) 8,840 1,837,338 Societe Television Francaise 1(1) 74,120 1,511,523 Television Broadcasts Ltd.(1) 539,000 1,744,851 Univision Communications, Inc.(2) 57,300 1,335,090 Westwood One, Inc.(2) 29,100 1,016,463 - ----------------------------------------------------------------------------- $ 11,948,164 - ----------------------------------------------------------------------------- Business Services -- 2.2% - ----------------------------------------------------------------------------- Fair, Isaac and Co., Inc. 38,500 $ 1,364,825 Iron Mountain, Inc.(2) 36,800 1,023,040 - ----------------------------------------------------------------------------- $ 2,387,865 - ----------------------------------------------------------------------------- Business Services - Miscellaneous -- 3.0% - ----------------------------------------------------------------------------- Dun & Bradstreet Corp.(2) 56,400 $ 1,990,356 First Data Corp. 37,600 1,306,600 Rhapsody Ltd.-Musiclegal.Com(2)(3) 750 0 - ----------------------------------------------------------------------------- $ 3,296,956 - ----------------------------------------------------------------------------- Commercial Services & Supplies -- 7.3% - ----------------------------------------------------------------------------- Automatic Data Processing, Inc. 23,100 $ 872,487 Concord EFS, Inc.(2) 47,900 977,639 Sindo Ricoh Co.(1) 85,010 4,027,126 SECURITY SHARES VALUE - ----------------------------------------------------------------------------- Commercial Services & Supplies (continued) - ----------------------------------------------------------------------------- St. Ives PLC(1) 416,930 $ 2,081,238 - ----------------------------------------------------------------------------- $ 7,958,490 - ----------------------------------------------------------------------------- Computers and Business Equipment -- 2.0% - ----------------------------------------------------------------------------- Dell Computer Corp.(2) 38,500 $ 1,024,870 International Business Machines Corp. 15,800 1,191,004 - ----------------------------------------------------------------------------- $ 2,215,874 - ----------------------------------------------------------------------------- Distributors -- 1.4% - ----------------------------------------------------------------------------- Azlan Group PLC(1)(2) 842,290 $ 1,551,449 - ----------------------------------------------------------------------------- $ 1,551,449 - ----------------------------------------------------------------------------- Diversified Financials -- 3.0% - ----------------------------------------------------------------------------- Federated Investors, Inc., Class B 36,300 $ 1,059,960 Legg Mason, Inc. 18,000 868,860 Moody's Corp. 27,400 1,323,968 - ----------------------------------------------------------------------------- $ 3,252,788 - ----------------------------------------------------------------------------- Diversified Telecommunication Services -- 4.2% - ----------------------------------------------------------------------------- BT Group PLC(1) 438,000 $ 1,355,917 Harris Corp. 42,700 1,364,265 KT Corp. ADR(1) 82,907 1,882,818 - ----------------------------------------------------------------------------- $ 4,603,000 - ----------------------------------------------------------------------------- Electronic Equipment & Instruments -- 3.1% - ----------------------------------------------------------------------------- Novellus System, Inc.(2) 25,600 $ 626,176 Sony Corp.(1) 64,000 2,787,649 - ----------------------------------------------------------------------------- $ 3,413,825 - ----------------------------------------------------------------------------- Entertainment -- 1.5% - ----------------------------------------------------------------------------- The Walt Disney Co. 32,500 $ 509,600 Viacom, Inc., Class A(2) 26,500 1,078,550 - ----------------------------------------------------------------------------- $ 1,588,150 - ----------------------------------------------------------------------------- Film Production -- 1.8% - ----------------------------------------------------------------------------- Fuji Photo Film Co., Ltd.(1) 66,000 $ 2,012,890 - ----------------------------------------------------------------------------- $ 2,012,890 - -----------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 16 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 PORTFOLIO OF INVESTMENTS CONT'D
SECURITY SHARES VALUE - ----------------------------------------------------------------------------- Health Care Equipment and Supplies -- 1.2% - ----------------------------------------------------------------------------- Given Imaging Ltd.(2) 120,500 $ 1,354,420 - ----------------------------------------------------------------------------- $ 1,354,420 - ----------------------------------------------------------------------------- Health Care Providers & Services -- 1.1% - ----------------------------------------------------------------------------- Quest Diagnostics, Inc.(2) 20,900 $ 1,171,445 - ----------------------------------------------------------------------------- $ 1,171,445 - ----------------------------------------------------------------------------- Household Durables -- 0.0% - ----------------------------------------------------------------------------- Humax Co., Ltd.(1) 297 $ 5,955 - ----------------------------------------------------------------------------- $ 5,955 - ----------------------------------------------------------------------------- Information Services -- 2.8% - ----------------------------------------------------------------------------- Acxiom Corp.(2) 63,300 $ 1,117,245 Arbitron, Inc.(2) 31,600 1,042,800 Identix, Inc.(2) 135,544 853,927 - ----------------------------------------------------------------------------- $ 3,013,972 - ----------------------------------------------------------------------------- Insurance -- 1.2% - ----------------------------------------------------------------------------- MGIC Investment Corp. 21,400 $ 1,288,494 - ----------------------------------------------------------------------------- $ 1,288,494 - ----------------------------------------------------------------------------- IT Consulting & Services -- 4.1% - ----------------------------------------------------------------------------- Accenture Ltd., Class A(2) 72,700 $ 1,195,915 Nomura Research Institute, Ltd.(1) 7,200 911,108 SunGard Data Systems, Inc.(2) 59,800 1,474,070 Unilog S.A.(1) 29,570 959,782 - ----------------------------------------------------------------------------- $ 4,540,875 - ----------------------------------------------------------------------------- Multimedia -- 2.3% - ----------------------------------------------------------------------------- Pearson PLC(1) 252,993 $ 2,514,041 - ----------------------------------------------------------------------------- $ 2,514,041 - ----------------------------------------------------------------------------- Pharmaceuticals -- 1.6% - ----------------------------------------------------------------------------- Takeda Chemical Industries, Ltd.(1) 42,000 $ 1,772,779 - ----------------------------------------------------------------------------- $ 1,772,779 - ----------------------------------------------------------------------------- Publishing -- 20.0% - ----------------------------------------------------------------------------- E.W. Scripps Co., Class A 16,200 $ 1,151,820 EMAP PLC(1) 176,880 1,927,437 SECURITY SHARES VALUE - ----------------------------------------------------------------------------- Publishing (continued) - ----------------------------------------------------------------------------- Knight-Ridder, Inc. 14,500 $ 880,585 Lagardere S.C.A.(1) 46,750 1,814,564 Lee Enterprises, Inc. 30,800 1,051,820 McClatchy Co., (The), Class A 22,200 1,280,940 Mondadori (Arnoldo) Editore S.P.A(1) 274,590 1,632,233 Promotora de Informaciones S.A. (Prisa)(1) 257,740 2,336,031 Reed Elsevier PLC(1) 210,570 1,880,621 Scholastic Corp.(2) 43,600 1,839,048 Trinity Mirror PLC(1) 421,150 2,542,320 West Australian Newspapers Holdings Ltd.(1) 871,800 2,491,988 Wolters Kluwer N.V.-CVA(1) 60,650 1,085,127 - ----------------------------------------------------------------------------- $ 21,914,534 - ----------------------------------------------------------------------------- Semiconductor Equipment and Products -- 4.1% - ----------------------------------------------------------------------------- Applied Materials, Inc.(2) 43,600 $ 582,496 Linear Technology Corp. 35,000 917,700 Microchip Technology, Inc.(2) 42,700 898,835 Samsung Electronics(1) 7,650 2,115,590 - ----------------------------------------------------------------------------- $ 4,514,621 - ----------------------------------------------------------------------------- Software -- 3.6% - ----------------------------------------------------------------------------- Activision, Inc.(2) 41,900 $ 1,167,753 Intuit, Inc.(2) 15,400 687,302 Microsoft Corp.(2) 22,700 1,114,116 THQ, Inc.(2) 41,000 947,100 - ----------------------------------------------------------------------------- $ 3,916,271 - ----------------------------------------------------------------------------- Specialty Retail -- 2.5% - ----------------------------------------------------------------------------- HMV Group PLC(1)(2) 665,400 $ 1,431,616 Lexmark International, Inc.(2) 22,200 1,047,840 Tweeter Home Entertainment Group, Inc.(2) 35,900 258,121 - ----------------------------------------------------------------------------- $ 2,737,577 - ----------------------------------------------------------------------------- Wireless Telecommunications Services -- 0.5% - ----------------------------------------------------------------------------- BCE, Inc. 29,700 $ 539,352 - ----------------------------------------------------------------------------- $ 539,352 - ----------------------------------------------------------------------------- Total Common Stocks (identified cost $111,004,960) $101,959,321 - -----------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 17 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 PORTFOLIO OF INVESTMENTS CONT'D COMMERCIAL PAPER -- 5.7%
PRINCIPAL AMOUNT SECURITY (000'S OMITTED) VALUE - ----------------------------------------------------------------------------- Asset Security Coop. Corp., 1.78%, 9/23/02 $ 3,000 $ 2,996,589 General Electric Capital Corp., 1.89%, 9/3/02 3,289 3,288,482 - ----------------------------------------------------------------------------- Total Commercial Paper (at amortized cost, $6,285,071) $ 6,285,071 - ----------------------------------------------------------------------------- Total Investments -- 98.8% (identified cost $117,290,031) $108,244,392 - ----------------------------------------------------------------------------- Other Assets, Less Liabilities -- 1.2% $ 1,312,552 - ----------------------------------------------------------------------------- Net Assets -- 100.0% $109,556,944 - -----------------------------------------------------------------------------
(1) Foreign security. (2) Non-income producing security. (3) Security valued at fair value using methods determined in good faith by or at the direction of the Trustees. SEE NOTES TO FINANCIAL STATEMENTS 18 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 PORTFOLIO OF INVESTMENTS CONT'D COUNTRY CONCENTRATION OF PORTFOLIO
PERCENTAGE COUNTRY OF NET ASSETS VALUE - ---------------------------------------------------------------------- United States 54.3% $59,531,912 United Kingdom 15.1 16,510,152 Japan 8.5 9,321,764 Republic of Korea 8.5 9,304,465 France 3.9 4,285,869 Australia 2.3 2,491,988 Spain 2.1 2,336,031 Hong Kong 1.6 1,744,851 Italy 1.5 1,632,233 Netherlands 1.0 1,085,127
SEE NOTES TO FINANCIAL STATEMENTS 19 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES
AS OF AUGUST 31, 2002 Assets - ------------------------------------------------------ Investments, at value (identified cost, $117,290,031) $108,244,392 Foreign currency, at value (identified cost, $28,661) 28,870 Receivable for investments sold 1,865,717 Interest and dividends receivable 259,116 Prepaid expenses 724 - ------------------------------------------------------ TOTAL ASSETS $110,398,819 - ------------------------------------------------------ Liabilities - ------------------------------------------------------ Payable for investments purchased $ 709,150 Due to bank 120,554 Accrued expenses 12,171 - ------------------------------------------------------ TOTAL LIABILITIES $ 841,875 - ------------------------------------------------------ NET ASSETS APPLICABLE TO INVESTORS' INTEREST IN PORTFOLIO $109,556,944 - ------------------------------------------------------ Sources of Net Assets - ------------------------------------------------------ Net proceeds from capital contributions and withdrawals $118,590,170 Net unrealized depreciation (computed on the basis of identified cost) (9,033,226) - ------------------------------------------------------ TOTAL $109,556,944 - ------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED AUGUST 31, 2002 Investment Income - ------------------------------------------------------ Dividends (net of foreign taxes, $214,896) $ 1,880,901 Interest 257,798 - ------------------------------------------------------ TOTAL INVESTMENT INCOME $ 2,138,699 - ------------------------------------------------------ Expenses - ------------------------------------------------------ Investment adviser fee $ 1,308,505 Administration fee 435,900 Trustees' fees and expenses 12,434 Custodian fee 212,752 Legal and accounting services 32,525 Miscellaneous 4,912 - ------------------------------------------------------ TOTAL EXPENSES $ 2,007,028 - ------------------------------------------------------ NET INVESTMENT INCOME $ 131,671 - ------------------------------------------------------ Realized and Unrealized Gain (Loss) - ------------------------------------------------------ Net realized gain (loss) -- Investment transactions (identified cost basis) $(35,717,646) Foreign currency and forward foreign currency exchange contract transactions (540,018) - ------------------------------------------------------ NET REALIZED LOSS $(36,257,664) - ------------------------------------------------------ Change in unrealized appreciation (depreciation) -- Investments (identified cost basis) $ 5,003,463 Foreign currency and forward foreign currency exchange contracts 4,835 - ------------------------------------------------------ NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 5,008,298 - ------------------------------------------------------ NET REALIZED AND UNREALIZED LOSS $(31,249,366) - ------------------------------------------------------ NET DECREASE IN NET ASSETS FROM OPERATIONS $(31,117,695) - ------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 20 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) YEAR ENDED YEAR ENDED IN NET ASSETS AUGUST 31, 2002 AUGUST 31, 2001 - -------------------------------------------------------------------------- From operations -- Net investment income $ 131,671 $ 226,047 Net realized loss (36,257,664) (49,787,298) Net change in unrealized appreciation (depreciation) 5,008,298 (59,825,145) - -------------------------------------------------------------------------- NET DECREASE IN NET ASSETS FROM OPERATIONS $ (31,117,695) $ (109,386,396) - -------------------------------------------------------------------------- Capital transactions -- Contributions $ 58,848,639 $ 121,367,133 Withdrawals (123,142,649) (141,623,470) - -------------------------------------------------------------------------- NET DECREASE IN NET ASSETS FROM CAPITAL TRANSACTIONS $ (64,294,010) $ (20,256,337) - -------------------------------------------------------------------------- NET DECREASE IN NET ASSETS $ (95,411,705) $ (129,642,733) - -------------------------------------------------------------------------- Net Assets - -------------------------------------------------------------------------- At beginning of year $ 204,968,649 $ 334,611,382 - -------------------------------------------------------------------------- AT END OF YEAR $ 109,556,944 $ 204,968,649 - --------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 21 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 FINANCIAL STATEMENTS CONT'D SUPPLEMENTARY DATA
YEAR ENDED AUGUST 31, ----------------------------------------------------------- 2002 2001 2000 1999 1998 - --------------------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------------------- Ratios (As a percentage of average daily net assets): Expenses 1.15% 1.11% 1.13% 1.36% 1.44% Net investment income (loss) 0.08% 0.08% (0.13)% (0.38)% 0.01% Portfolio Turnover 107% 160% 173% 131% 157% - --------------------------------------------------------------------------------------------- TOTAL RETURN(1) (17.67)% -- -- -- -- - --------------------------------------------------------------------------------------------- NET ASSETS, END OF YEAR (000'S OMITTED) $109,557 $204,969 $334,611 $97,262 $53,556 - ---------------------------------------------------------------------------------------------
(1) Total return is required to be diclosed for fiscal years beginning after December 15, 2000. SEE NOTES TO FINANCIAL STATEMENTS 22 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS 1 Significant Accounting Policies - ------------------------------------------- Information Age Portfolio (the Portfolio) is registered under the Investment Company Act of 1940 as a diversified, open-end management investment company, which was organized as a trust under the laws of the State of New York on June 1, 1995. The Portfolio seeks to provide long-term capital growth by investing in a global and diversified portfolio of securities of information age companies. The Declaration of Trust permits the Trustees to issue interests in the Portfolio. The following is a summary of the significant accounting policies of the Portfolio. The policies are in conformity with accounting principles generally accepted in the United States of America. A Investment Valuations -- Marketable securities, including options, that are listed on foreign or U.S. securities exchanges or in the NASDAQ National Market System are valued at closing sale prices, on the exchange where such securities are principally traded. Futures positions on securities or currencies are generally valued at closing settlement prices. Unlisted or listed securities for which closing sale prices are not available are valued at the mean between the latest bid and asked prices. Short-term debt securities with a remaining maturity of 60 days or less are valued at amortized cost. Other fixed income and debt securities, including listed securities and securities for which price quotations are available, will normally be valued on the basis of valuations furnished by a pricing service. Investments for which valuations or market quotations are unavailable are valued at fair value using methods determined in good faith by or at the direction of the Trustees. For foreign investments, if trading or events occurring in other markets after the close of the principal exchange in which the securities are traded are expected to materially affect the value of the investments, then those investments are valued, taking into consideration these events, at their fair value following procedures approved by the Trustees. B Income Taxes -- The Portfolio has elected to be treated as a partnership for United States 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 one of the Portfolio's investors is a regulated investment company that invests all or substantially all of its 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 investor's distributive share of the Portfolio's net investment income, net realized capital gains, and any other items of income, gain, loss, deduction or credit. Withholding taxes on foreign dividends and capital gains have been provided for in accordance with the Portfolio's understanding of the applicable countries' tax rules and rates. C Financial Futures Contracts -- Upon the entering of a financial futures contract, the Portfolio is required to deposit (initial margin) either in cash or securities an amount equal to a certain percentage of the purchase price indicated in the financial futures contract. Subsequent payments are made or received by the Portfolio (margin maintenance) each day, dependent on the daily fluctuations in the value of the underlying security, and are recorded for book purposes as unrealized gains or losses by the Portfolio. The Portfolio's investment in financial futures contracts is designed only to hedge against anticipated future changes in interest or currency exchange rates. Should interest or currency exchange rates move unexpectedly, the Portfolio may not achieve the anticipated benefits of the financial futures contracts and may realize a loss. D Options on Financial Futures -- Upon the purchase of a put option on foreign currency by the Portfolio, the premium paid is recorded as an investment, the value of which is marked-to-market daily. When the purchased option expires, the Portfolio will realize a loss in the amount of the cost of the option. When the Portfolio enters into a closing sales transaction, the Portfolio will realize a gain or loss depending upon whether the sales proceeds from the closing sales transaction are greater or less than the cost of the option. When the Portfolio exercises a put option, settlement is made in cash. The risk associated with purchasing options is limited to the premium originally paid. E Foreign Currency Translation -- Investment valuations, other assets, and liabilities initially expressed in foreign currencies are converted each business day into U.S. dollars based upon current exchange rates. Purchases and sales of foreign investment securities and income and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such transactions. Realized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed. 23 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS CONT'D F Forward Foreign Currency Exchange Contracts -- The Portfolio may enter into forward foreign currency exchange contracts for the purchase or sale of a specific foreign currency at a fixed price on a future date. Risks may arise upon entering these contracts from the potential inability of counterparties to meet the terms of their contracts and from movements in the value of a foreign currency relative to the U.S. dollar. The Portfolio will enter into forward contracts for hedging purposes as well as non-hedging purposes. The forward foreign currency exchange contracts are adjusted by the daily exchange rate of the underlying currency and any gains or losses are recorded for financial statement purposes as unrealized until such time as the contracts have been closed or offset. G Expense Reduction -- Investors Bank and Trust Company (IBT) serves as custodian of the Portfolio. Pursuant to the custodian agreement, IBT receives a fee reduced by credits which are determined based on the average daily cash balance the Portfolio maintains with IBT. All significant credit balances used to reduce the Portfolio's custodian fees are reported as a reduction of total expenses in the Statement of Operations. For the year ended August 31, 2002, $464 credit balances were used to reduce the Portfolio's custodian fee. H Use of Estimates -- The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates. I Other -- Investment transactions are accounted for on a trade-date basis. Dividend income is recorded on the ex-dividend date. However, if the ex-dividend date has passed, certain dividends from foreign securities are recorded as the Portfolio is informed of the ex-dividend date. Interest income is recorded on the accrual basis. 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), and Lloyd George Investment Management (Bermuda) Limited, an affiliate of EVM (the Advisers), as compensation for management and investment advisory services rendered to the Portfolio. Under the advisory agreement, the Advisers receive a monthly fee, divided equally between them, of 0.0625% (0.75% annually) of the average daily net assets of the Portfolio up to $500,000,000, and at reduced rates as daily net assets exceed that level. For the year ended August 31, 2002, the adviser fee was 0.75% of average net assets for such period and amounted to $1,308,505. In addition, an administrative fee is earned by EVM for managing and administering the business affairs of the Portfolio. Under the administration agreement, EVM earns a monthly fee in the amount of 1/48th of 1% (equal to 0.25% annually) of the average daily net assets of the Portfolio up to $500,000,000, and at reduced rates as daily net assets exceed that level. For the year ended August 31, 2002, the administration fee was 0.25% of average net assets for such period and amounted to $435,900. Except as to the Trustees of the Portfolio who are not members of the Advisers or EVM's organization, officers and Trustees receive remuneration for their services to the Portfolio out of such investment adviser and administrative fees. Trustees of the Portfolio that are not affiliated with the Advisers may elect to defer receipt of all or a percentage of their annual fees in accordance with the terms of the Trustees Deferred Compensation Plan. For the year ended August 31, 2002, no significant amounts have been deferred. Certain officers and Trustees of the Portfolio are officers of the above organizations. 3 Investment Transactions - ------------------------------------------- Purchases and sales of investments, other than short-term obligations, aggregated $169,734,840 and $217,259,020, respectively, for the year ended August 31, 2002. Realized losses from in-kind withdrawals totaled $3,752,916 for the year ended August 31, 2002. 4 Federal Income Tax Basis of Unrealized Appreciation (Depreciation) - ------------------------------------------- The cost and unrealized appreciation (depreciation) in value of the investments owned at August 31, 2002, as computed on a federal income tax basis are as follows: AGGREGATE COST $117,389,747 ------------------------------------------------------ Gross unrealized appreciation $ 8,419,755 Gross unrealized depreciation (17,565,110) ------------------------------------------------------ NET UNREALIZED DEPRECIATION $ (9,145,355) ------------------------------------------------------
24 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 NOTES TO FINANCIAL STATEMENTS CONT'D The unrealized appreciation on foreign currency was $12,413. 5 Risks Associated with Foreign Investments - ------------------------------------------- Investing in securities issued by companies whose principal business activities are outside the United States may involve significant risks not present in domestic investments. For example, there is generally less publicly available information about foreign companies, particularly those not subject to the disclosure and reporting requirements of the U.S. securities laws. Foreign issuers are generally not bound by uniform accounting, auditing, and financial reporting requirements and standards of practice comparable to those applicable to domestic issuers. Investments in foreign securities also involve the risk of possible adverse changes in investment or exchange control regulations, expropriation or confiscatory taxation, limitation on the removal of funds or other assets of the Portfolio, political or financial instability or diplomatic and other developments which could affect such investments. Foreign stock markets, while growing in volume and sophistication, are generally not as developed as those in the United States, and securities of some foreign issuers (particularly those in developing countries) may be less liquid and more volatile than securities of comparable U.S. companies. In general, there is less overall governmental supervision and regulation of foreign securities markets, broker-dealers, and issuers than in the United States. 6 Financial Instruments - ------------------------------------------- The Portfolio regularly trades in financial instruments with off-balance sheet risk in the normal course of its investing activities to assist in managing exposure to various market risks. These financial instruments may include written options, forward foreign currency exchange contracts and financial futures contracts and may involve, to a varying degree, elements of risk in excess of the amounts recognized for financial statement purposes. The notional or contractual amounts of these instruments represent the investment the Portfolio has in particular classes of financial instruments and does not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered. The Portfolio did not have any open obligations under these financial instruments at August 31, 2002. 7 Line of Credit - ------------------------------------------- The Portfolio participates with other portfolios and funds managed by BMR and EVM and its affiliates in a $150 million unsecured line of credit agreement with a group of banks. 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 or fund based on its borrowings at an amount above either the Eurodollar rate or federal funds rate. In addition, a fee computed at an annual rate of 0.10% on the daily unused portion of the 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 year ended August 31, 2002. 25 INFORMATION AGE PORTFOLIO AS OF AUGUST 31, 2002 INDEPENDENT ACCOUNTANTS' REPORT TO THE TRUSTEES AND INVESTORS OF INFORMATION AGE PORTFOLIO: - --------------------------------------------- In our opinion, the accompanying statement of assets and liabilities, including the portfolio of investments, and the related statements of operations and of changes in net assets and the supplementary data present fairly, in all material respects, the financial position of Information Age Portfolio (the "Portfolio") at August 31, 2002, and the results of its operations, the changes in its net assets and the supplementary data for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and supplementary data (hereafter referred to as "financial statements") are the responsibility of the Portfolio'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 of America, 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 August 31, 2002 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Boston, Massachusetts October 4 , 2002 26 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 MANAGEMENT AND ORGANIZATION FUND MANAGEMENT. The Trustees of Eaton Vance Growth Trust (the Trust) and the Information Age Portfolio (the Portfolio) are responsible for the overall management and supervision of the Trust's and Portfolio's affairs. The Trustees and officers of the Trust and the Portfolio are listed below. Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. Trustees and officers of the Trust and the Portfolio hold indefinite terms of office. The business address of each Trustee and officer is The Eaton Vance Building, 255 State Street, Boston, Massachusetts, 02109. INTERESTED TRUSTEE(S)
POSITION(S) TERM OF NAME, WITH THE OFFICE AND NUMBER OF PORTFOLIOS AND DATE TRUST AND LENGTH OF PRINCIPAL OCCUPATION(S) IN FUND COMPLEX OF BIRTH PORTFOLIO SERVICE DURING PAST FIVE YEARS OVERSEEN BY TRUSTEE(1) - -------------------------------------------------------------------------------------------------------------------------- Jessica M. Bibliowicz Trustee of Since 1998 President and Chief Executive Officer of 173 DOB: 11/28/59 the Trust National Financial Partners (financial services company) (since April 1999). President and Chief Operating Officer of John A. Levin & Co. (registered investment adviser) (July 1997 to April 1999) and a Director of Baker, Fentress & Company, which owns John A. Levin & Co. (July 1997 to April 1999). Ms. Bibliowicz is an interested person because of her affiliation with a brokerage firm. James B. Hawkes Trustee Trustee of Chairman, President and Chief Executive 178 DOB: 11/9/41 the Trust Officer of BMR, EVM and their corporate since parent, Eaton Vance Corp. (EVC), and 1989; of corporate trustee, Eaton Vance, Inc. the (EV); Director of EV; Vice President and Portfolio Director of EVD. President or officer of since 1995 179 investment companies in the Eaton Vance Fund Complex. Mr. Hawkes is an interested person because of his positions with BMR, EVM and EVC, which are affiliates of the Trust and the Portfolio. Hon. Robert Lloyd Vice President Vice Chairman and Chief Executive Officer of 5 George(2) and Trustee of President Lloyd George Management (B.V. I.) DOB: 8/13/52 the Portfolio since Limited, Lloyd George Management (Hong 1995; Kong) Limited and Lloyd George Trustee Investment (Bermuda) Limited. since 1996 NAME, AND DATE OTHER DIRECTORSHIPS OF BIRTH HELD - ----------------------- Jessica M. Bibliowicz None DOB: 11/28/59 James B. Hawkes Director of EVC DOB: 11/9/41 Hon. Robert Lloyd None George(2) DOB: 8/13/52
27 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 MANAGEMENT AND ORGANIZATION CONT'D NONINTERESTED TRUSTEE(S)
POSITION(S) TERM OF NAME, WITH THE OFFICE AND NUMBER OF PORTFOLIOS AND DATE TRUST AND LENGTH OF PRINCIPAL OCCUPATION(S) IN FUND COMPLEX OF BIRTH PORTFOLIO SERVICE DURING PAST FIVE YEARS OVERSEEN BY TRUSTEE(1) - ----------------------------------------------------------------------------------------------------------------------- Hon. Edward K.Y. Trustee of the Since 1996 President of Lingnan University of Hong 5 Chen(2) Portfolio Kong. Director of First Pacific Company DOB: 1/14/45 and Asia Satellite Telecommunications Holdings Ltd. Board Member of the Mass Transit Railway Corporation. Member of the Executive Council of the Hong Kong Government from 1992-1997. Donald R. Dwight Trustee Trustee of President of Dwight Partners, Inc. 178 DOB: 3/26/31 the Trust (corporate relations and communications since company). 1989; of the Portfolio since 1995 Samuel L. Hayes, III Trustee Trustee of Jacob H. Schiff Professor of Investment 178 DOB: 2/23/35 the Trust Banking Emeritus, Harvard University since Graduate School of Business 1989; of Administration. the Portfolio since 1995 Norton H. Reamer Trustee Trustee of President, Unicorn Corporation (an 178 DOB: 9/21/35 the Trust investment and financial advisory since services company) (since September 1989; of 2000). Chairman, Hellman, Jordan the Management Co., Inc. (an investment Portfolio management company) (since November since 1995 2000). Advisory Director, Berkshire Capital Corporation (investment banking firm) (since June 2002). Formerly, Chairman of the Board, United Asset Management Corporation (a holding company owning institutional investment management firms) and Chairman, President and Director, UAM Funds (mutual funds). Lynn A. Stout Trustee Since 1998 Professor of Law, University of 173 DOB: 9/14/57 California at Los Angeles School of Law (since July 2001). Formerly, Professor of Law, Georgetown University Law Center. Jack L. Treynor Trustee Trustee of Investment Adviser and Consultant. 170 DOB: 2/21/30 the Trust since 1989; of the Portfolio since 1995 NAME, AND DATE OTHER DIRECTORSHIPS OF BIRTH HELD - ----------------------- Hon. Edward K.Y. None Chen(2) DOB: 1/14/45 Donald R. Dwight Trustee/Director of DOB: 3/26/31 the Royce Funds (mutual funds) consisting of 17 portfolios Samuel L. Hayes, III Director of DOB: 2/23/35 Tiffany & Co. (specialty retailer) and Director of Telect, Inc. (telecommunication services company) Norton H. Reamer None DOB: 9/21/35 Lynn A. Stout None DOB: 9/14/57 Jack L. Treynor None DOB: 2/21/30
28 EATON VANCE INFORMATION AGE FUND AS OF AUGUST 31, 2002 MANAGEMENT AND ORGANIZATION CONT'D PRINCIPAL OFFICERS WHO ARE NOT TRUSTEES
POSITION(S) TERM OF NAME, WITH THE OFFICE AND AND DATE TRUST AND LENGTH OF PRINCIPAL OCCUPATION(S) OF BIRTH PORTFOLIO SERVICE DURING PAST FIVE YEARS - --------------------------------------------------------------------------------------------------------------------------- Gregory L. Coleman Vice President of the Trust Since 2001 Partner of Atlanta Capital Management DOB: 10/28/49 Company, L.L.C. (Atlanta Capital). Officer of 10 investment companies managed by EVM or BMR. Thomas E. Faust Jr. President of the Trust Since 2002 Executive Vice President and Chief DOB: 5/31/58 Investment Officer of EVM and BMR and Director of EVC. Officer of 50 investment companies managed by EVM or BMR. Martha G. Locke Vice President of the Portfolio Since 2001 Vice President of EVM and BMR since DOB: 6/21/52 March 1998. Vice President and Senior Equity Analyst at State Street Global Advisors (1987-1997). Officer of 5 investment companies managed by EVM or BMR. Duncan W. Richardson President of the Portfolio Since 2002 Senior Vice President and Chief Equity DOB: 10/26/57 Investment Officer of EVM and BMR Officer of 40 companies managed by EVM or BMR. James A. Womack Vice President of the Trust Since 2001 Vice President of Atlanta Capital. DOB: 11/20/68 Officer of 10 investment companies managed by EVM or BMR. Alan R. Dynner Secretary Since 1997 Vice President, Secretary and Chief DOB: 10/10/40 Legal Officer of BMR, EVM, EVD and EVC. Officer of 178 investment companies managed by EVM or BMR. William J. Austin Jr. Treasurer of the Portfolio Since 2002 Assistant Vice President of EVM and BMR. D.O.B. 12/27/51 Officer of 54 investment companies managed by EVM or BMR. James L. O'Connor Treasurer of the Trust Since 1989 Vice President of BMR, EVM and EVD. DOB: 4/1/45 Officer of 100 investment companies managed by EVM or BMR.
(1) Includes both master and feeder funds in a master-feeder structure. (2) The business address of Mr. Lloyd George is 3803 One Exchange Square, Central, Hong Kong and of Mr. Chen is President's Office, Lingnan College, Tuen Mun, Hong Kong. The SAI for the Fund includes additional information about the Trustees and officers of the Fund and Portfolio and can be obtained without charge by calling 1-800-225-6265. 29 SPONSOR AND MANAGER OF EATON VANCE INFORMATION AGE FUND AND ADMINISTRATOR OF INFORMATION AGE PORTFOLIO EATON VANCE MANAGEMENT The Eaton Vance Building 255 State Street Boston, MA 02109 CO-ADVISERS OF INFORMATION AGE PORTFOLIO BOSTON MANAGEMENT AND RESEARCH The Eaton Vance Building 255 State Street Boston, MA 02109 LLOYD GEORGE INVESTMENT MANAGEMENT (BERMUDA) LIMITED 3808 One Exchange Square Central, Hong Kong PRINCIPAL UNDERWRITER EATON VANCE DISTRIBUTORS, INC. The Eaton Vance Building 255 State Street Boston, MA 02109 (617) 482-8260 CUSTODIAN INVESTORS BANK & TRUST COMPANY 200 Clarendon Street Boston, MA 02116 TRANSFER AGENT PFPC INC. Attn: Eaton Vance Funds P.O. Box 9653 Providence, RI 02940-9653 (800) 262-1122 INDEPENDENT ACCOUNTANTS PRICEWATERHOUSECOOPERS LLP 160 Federal Street Boston, MA 02110 EATON VANCE FUNDS EATON VANCE MANAGEMENT BOSTON MANAGEMENT AND RESEARCH EATON VANCE DISTRIBUTORS, INC. PRIVACY NOTICE The Eaton Vance organization is committed to ensuring your financial privacy. This notice is being sent to comply with privacy regulations of the Securities and Exchange Commission. Each of the above financial institutions has in effect the following policy with respect to nonpublic personal information about its customers: - - Only such information received from you, through application forms or otherwise, and information about your Eaton Vance fund transactions will be collected. - - None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). - - Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information. For more information about Eaton Vance's privacy policies, call: 1-800-262-1122 EATON VANCE INFORMATION AGE FUND THE EATON VANCE BUILDING 255 STATE STREET BOSTON, MA 02109 This report must be preceded or accompanied by a current prospectus which contains more complete information on the Fund, including its sales charges and expenses. Please read the prospectus carefully before you invest or send money. 424-10/02 IASRC -----END PRIVACY-ENHANCED MESSAGE-----