-----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, O9/ea48OZbcSlhi3Hr3bueubtfYqJjStNP7mILbB0cW0sfohOz0V5Ft8kDu3OI+j xa9QumGcjrFwCYq2uYFhgQ== 0001047469-03-020167.txt : 20030530 0001047469-03-020167.hdr.sgml : 20030530 20030530152715 ACCESSION NUMBER: 0001047469-03-020167 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030331 FILED AS OF DATE: 20030530 EFFECTIVENESS DATE: 20030530 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: 03725795 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: EATON VANCE GROWTH FUND INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: VANCE SANDERS COMMON STOCK FUND INC DATE OF NAME CHANGE: 19820915 FORMER COMPANY: FORMER CONFORMED NAME: BOSTON STOCK FUND INC DATE OF NAME CHANGE: 19730619 N-30D 1 a2111042zn-30d.txt N-30D [EATON VANCE LOGO] [ADDING MACHINE PHOTO] SEMIANNUAL REPORT MARCH 31, 2003 [NYSE FLAG PHOTO] ATLANTA CAPITAL SMALL-CAP FUND [FLOOR STOCK EXCHANGE PHOTO] 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. ATLANTA CAPITAL SMALL-CAP FUND as of March 31, 2003 INVESTMENT UPDATE [PHOTO OF PAUL J. MARSHALL WILLIAM R. HACKNEY, III AND CHARLES B. REED] The Investment Team Managing Small-Cap Portfolio: Paul J. Marshall William R. Hackney, III Charles B. Reed MANAGEMENT DISCUSSION - - During the past six months, geopolitical and economic uncertainties confronted the market, the most important being the outcome of the war in Iraq and its impact on the economy. Our view is that the war with Iraq is the last major obstacle holding back the equity market and the economy. As the conflict gradually gets resolved, we look for economic growth to reaccelerate, pushing up both earnings and stock prices. - - The previous recession was primarily caused by the collapse of business investment, particularly in technology, telecommunication, and information technology. With the first recession of the new technology age, the economy did not respond in its traditional way. Given the current unusual recovery, we believe that our investment discipline of emphasizing quality small companies should serve us well, as we expect a moderate but steady recovery. - - The Russell 2000 Index posted a total return of 1.39% for the six months ended March 31, 2003.(1) The technology sector was the best performing sector in the Index, gaining over 20% for the period. The other sectors of the Russell 2000 Index that added to performance were energy, producer durables, and utilities. The worst performing sectors were consumer staples and basic materials. The disparate performance of the various sectors suggests that investors are beginning to focus on improving prospects for an economic recovery, following the end of the conflict with Iraq. - - Over the past six months, the Fund's returns were flat to modestly negative. While the Small-Cap Portfolio generally tried to be sector-neutral, relative to the Index, a small underweight in technology and a slight overweight in consumer staples detracted from the Portfolio's overall performance. Despite performance issues overall in the basic materials sector, securities from that sector were the most positive contributors to the Portfolio's performance, due to better stock selection versus the Index.(1) - - Stock selection was a positive contributor to the overall performance of the Portfolio. The Portfolio had strong stock selection in technology-related stocks, with some holdings posting strong gains over the past six months. Positive stock selection occurred within most sectors. All the companies in the Portfolio's basic materials sector had positive returns. The largest negative impact came from health care stocks, as the Portfolio's holdings in hospital and medical device companies performed poorly. THE FUND The Past Six Months - - During the six months ended March 31, 2003, the Fund's Class I shares had a total return of 0.00%. This return was the result of a net asset value (NAV) of $7.71 on March 31, 2003, unchanged from $7.71 on September 30, 2002.(2) The Fund's Class R shares had a total return of -0.39%, the result of a decrease in NAV to $7.67 from $7.70 during the same period.(2) THE VIEWS EXPRESSED IN THIS REPORT ARE THOSE OF THE PORTFOLIO MANAGERS AND ARE CURRENT ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER. THESE VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS, AND ATLANTA CAPITAL MANAGEMENT DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE INVESTMENT DECISIONS FOR ARE BASED ON MANY FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON BEHALF OF ANY FUND. 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. FUND INFORMATION As of March 31, 2003
PERFORMANCE(2) CLASS I CLASS R - -------------------------------------------------- Cumulative Total Returns (at net asset value) Life of Fund+ -22.90% -23.30%
+Inception Dates - Class I: 4/30/02; Class R: 4/30/02
TEN LARGEST HOLDINGS(3) By total net assets - --------------------------------------------------------- National Instruments Corp. 2.9% Landauer, Inc. 2.8 Fair, Isaac and Co., Inc. 2.8 ALLETE, Inc. 2.7 Affiliated Managers Group, Inc. 2.6 Florida Rock Industries, Inc. 2.5 ICU Medical, Inc. 2.4 Manhattan Associates, Inc. 2.4 Matthews International Corp. 2.4 Financial Federal Corp. 2.3
(1) It is not possible to invest directly in an Index. (2) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested. Class I and Class R have no sales charge. (3) Ten largest holdings accounted for 25.8% of the Portfolio's total 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. 2 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 FINANCIAL STATEMENTS (UNAUDITED) STATEMENT OF ASSETS AND LIABILITIES
AS OF MARCH 31, 2003 Assets - ---------------------------------------------------- Investment in Small-Cap Portfolio, at value (identified cost, $7,732,562) $7,518,726 Receivable for Fund shares sold 9,225 Receivable from the Administrator 491 - ---------------------------------------------------- TOTAL ASSETS $7,528,442 - ---------------------------------------------------- Liabilities - ---------------------------------------------------- Payable for Fund shares redeemed $ 1,017 Accrued expenses 11,691 - ---------------------------------------------------- TOTAL LIABILITIES $ 12,708 - ---------------------------------------------------- NET ASSETS $7,515,734 - ---------------------------------------------------- Sources of Net Assets - ---------------------------------------------------- Paid-in capital $8,328,800 Accumulated net realized loss from Portfolio (computed on the basis of identified cost) (592,557) Accumulated net investment loss (6,673) Net unrealized depreciation from Portfolio (computed on the basis of identified cost) (213,836) - ---------------------------------------------------- TOTAL $7,515,734 - ---------------------------------------------------- Class I Shares - ---------------------------------------------------- NET ASSETS $7,514,959 SHARES OUTSTANDING 974,848 NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE (net assets DIVIDED BY shares of beneficial interest outstanding) $ 7.71 - ---------------------------------------------------- Class R Shares - ---------------------------------------------------- NET ASSETS $ 775 SHARES OUTSTANDING 101 NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE (net assets DIVIDED BY shares of beneficial interest outstanding) $ 7.67 - ----------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED MARCH 31, 2003 Investment Income - --------------------------------------------------- Dividends allocated from Portfolio $ 41,976 Interest allocated from Portfolio 804 Expenses allocated from Portfolio (27,594) - --------------------------------------------------- NET INVESTMENT INCOME FROM PORTFOLIO $ 15,186 - --------------------------------------------------- Expenses - --------------------------------------------------- Trustees' fees and expenses $ 93 Distribution and service fees Class R 2 Custodian fee 6,508 Legal and accounting services 5,545 Registration fees 5,536 Printing and postage 2,366 Transfer and dividend disbursing agent fees 1,390 Miscellaneous 910 - --------------------------------------------------- TOTAL EXPENSES $ 22,350 - --------------------------------------------------- Deduct -- Preliminary allocation of expenses to the Administrator $ 491 - --------------------------------------------------- TOTAL EXPENSE REDUCTIONS $ 491 - --------------------------------------------------- NET EXPENSES $ 21,859 - --------------------------------------------------- NET INVESTMENT LOSS $ (6,673) - --------------------------------------------------- Realized and Unrealized Gain (Loss) from Portfolio - --------------------------------------------------- Net realized gain (loss) -- Investment transactions (identified cost basis) $(475,644) - --------------------------------------------------- NET REALIZED LOSS $(475,644) - --------------------------------------------------- Change in unrealized appreciation (depreciation) -- Investments (identified cost basis) $ 440,889 - --------------------------------------------------- NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 440,889 - --------------------------------------------------- NET REALIZED AND UNREALIZED LOSS $ (34,755) - --------------------------------------------------- NET DECREASE IN NET ASSETS FROM OPERATIONS $ (41,428) - ---------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 3 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 FINANCIAL STATEMENTS CONT'D STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED INCREASE (DECREASE) MARCH 31, 2003 YEAR ENDED IN NET ASSETS (UNAUDITED) SEPTEMBER 30, 2002(1) - --------------------------------------------------------------------------------- From operations -- Net investment loss $ (6,673) $ (5,994) Net realized loss (475,644) (117,060) Net change in unrealized appreciation (depreciation) 440,889 (654,725) - --------------------------------------------------------------------------------- NET DECREASE IN NET ASSETS FROM OPERATIONS $ (41,428) $ (777,779) - --------------------------------------------------------------------------------- Transactions in shares of beneficial interest -- Proceeds from sale of shares Class I $ 1,149,239 $ 8,235,922 Class R -- 1,010 Cost of shares redeemed Class I (568,715) (482,515) - --------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS FROM FUND SHARE TRANSACTIONS $ 580,524 $ 7,754,417 - --------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS $ 539,096 $ 6,976,638 - --------------------------------------------------------------------------------- Net Assets - --------------------------------------------------------------------------------- At beginning of period $ 6,976,638 $ -- - --------------------------------------------------------------------------------- AT END OF PERIOD $ 7,515,734 $ 6,976,638 - --------------------------------------------------------------------------------- Accumulated net investment loss included in net assets - --------------------------------------------------------------------------------- AT END OF PERIOD $ (6,673) $ -- - ---------------------------------------------------------------------------------
(1) For the period from the start of business, April 30, 2002, to September 30, 2002. SEE NOTES TO FINANCIAL STATEMENTS 4 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS I -------------------------------------------- SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30, MARCH 31, 2003 ------------------------ (UNAUDITED) 2002(1)(2) - ------------------------------------------------------------------------------ Net asset value -- Beginning of period $ 7.710 $10.000 - ------------------------------------------------------------------------------ Income (loss) from operations - ------------------------------------------------------------------------------ Net investment loss $(0.007) $(0.007) Net realized and unrealized gain (loss) 0.007(3) (2.283) - ------------------------------------------------------------------------------ TOTAL LOSS FROM OPERATIONS $ -- $(2.290) - ------------------------------------------------------------------------------ NET ASSET VALUE -- END OF PERIOD $ 7.710 $ 7.710 - ------------------------------------------------------------------------------ TOTAL RETURN(4) 0.00% (22.90)% - ------------------------------------------------------------------------------ Ratios/Supplemental Data+ - ------------------------------------------------------------------------------ Net assets, end of period (000's omitted) $ 7,515 $ 6,976 Ratios (As a percentage of average daily net assets): Net expenses(5) 1.35%(6) 1.37%(6) Net expenses after custodian fee reduction(5) 1.35%(6) 1.35%(6) Net investment loss (0.18)%(6) (0.20)%(6) Portfolio Turnover of the Portfolio 26% 17% - ------------------------------------------------------------------------------ + The operating expenses of the Portfolio reflect a reduction of the investment adviser fee. The operating expenses of the Fund reflect an allocation of expenses to the Administrator. Had such actions 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(5) 1.93%(6) 2.69%(6) Expenses after custodian fee reduction(5) 1.93%(6) 2.67%(6) Net investment loss (0.76)%(6) (1.52)%(6) Net investment loss per share $(0.030) $(0.053) - ------------------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) For the period from the start of business, April 30, 2002, to September 30, 2002. (3) Per share amount is not in accord with the net realized and unrealized gain (loss) on investments for the period because of the timing of sales of Fund shares and the amount of the per share realized and unrealized gains and losses at such time. (4) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested. Total return is not computed on an annualized basis. (5) Includes the Fund's share of the Portfolio's allocated expenses. (6) Annualized. SEE NOTES TO FINANCIAL STATEMENTS 5 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 FINANCIAL STATEMENTS CONT'D FINANCIAL HIGHLIGHTS
CLASS R -------------------------------------------- SIX MONTHS ENDED YEAR ENDED SEPTEMBER 30, MARCH 31, 2003 ------------------------ (UNAUDITED) 2002(1)(2) - ------------------------------------------------------------------------------ Net asset value -- Beginning of period $ 7.700 $10.000 - ------------------------------------------------------------------------------ Income (loss) from operations - ------------------------------------------------------------------------------ Net investment loss $(0.020) $(0.026) Net realized and unrealized loss (0.010) (2.274) - ------------------------------------------------------------------------------ TOTAL LOSS FROM OPERATIONS $(0.030) $(2.300) - ------------------------------------------------------------------------------ NET ASSET VALUE -- END OF PERIOD $ 7.670 $ 7.700 - ------------------------------------------------------------------------------ TOTAL RETURN(3) (0.39)% (23.00)% - ------------------------------------------------------------------------------ Ratios/Supplemental Data+ - ------------------------------------------------------------------------------ Net assets, end of period (000's omitted) $ 1 $ 1 Ratios (As a percentage of average daily net assets): Net expenses(4) 1.85%(5) 1.87%(5) Net expenses after custodian fee reduction(4) 1.85%(5) 1.85%(5) Net investment loss (0.75)%(5) (0.71)%(5) Portfolio Turnover of the Portfolio 26% 17% - ------------------------------------------------------------------------------ + The operating expenses of the Portfolio reflect a reduction of the investment adviser fee. The operating expenses of the Fund reflect an allocation of expenses to the Administrator. Had such actions 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(4) 2.43%(5) 3.19%(5) Expenses after custodian fee reduction(4) 2.43%(5) 3.17%(5) Net investment loss (1.33)%(5) (2.03)%(5) Net investment loss per share $(0.035) $(0.074) - ------------------------------------------------------------------------------
(1) Net investment loss per share was computed using average shares outstanding. (2) For the period from the start of business, April 30, 2002, to September 30, 2002. (3) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested. 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 6 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 1 Significant Accounting Policies - ------------------------------------------- Atlanta Capital Small-Cap 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 two classes of shares. Class I shares and Class R shares are offered at net asset value and are not subject to a sales charge. 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 the Small-Cap 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 (54.8% at March 31, 2003). 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 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 taxable income, including any net realized gain on investments. Accordingly, no provision for federal income or excise tax is necessary. At September 30, 2002 the Fund, for federal income tax purposes, had a capital loss carryover of $100,355 which will reduce the taxable income arising from future net realized gains on investments, if any, to the extent permitted by the Internal Revenue Code, and thus will reduce the amount of the distributions to shareholders which would otherwise be necessary to relieve the Fund of any liability for federal income or excise tax. Such capital loss carryover will expire on September 30, 2010. D Other -- Investment transactions are accounted for on a trade date basis. Dividends to shareholders are recorded on the ex-dividend date. 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. F Interim Financial Statements -- The interim financial statements relating to March 31, 2003 and for the six months then ended have not been audited by independent certified public accountants, but in the opinion of the Fund's management reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements. 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 net investment income and at least one distribution of all or substantially all of its net realized capital gains. Distributions are paid in the form of additional shares of the Fund or, at the election of the shareholder, in cash. Shareholders may reinvest capital gain distributions in additional shares of the Fund at the net asset value as of the close of business on the ex-dividend date. 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. 7 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D 3 Shares of Beneficial Interest - ------------------------------------------- The Fund's 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:
SIX MONTHS ENDED MARCH 31, 2003 YEAR ENDED CLASS I (UNAUDITED) SEPTEMBER 30, 2002(1) ------------------------------------------------------------------------------------ Sales 141,714 963,204 Redemptions (71,254) (58,816) ------------------------------------------------------------------------------------ NET INCREASE 70,460 904,388 ------------------------------------------------------------------------------------
SIX MONTHS ENDED MARCH 31, 2003 YEAR ENDED CLASS R (UNAUDITED) SEPTEMBER 30, 2002(1) ------------------------------------------------------------------------------------ Sales -- 101 ------------------------------------------------------------------------------------ NET INCREASE -- 101 ------------------------------------------------------------------------------------
(1) For the period from the start of business, April 30, 2002 to September 30, 2002. On May 1, 2002, the Fund received an in-kind contribution in return for 591,534 Class I shares of the Fund. 4 Transactions with Affiliates - ------------------------------------------- Eaton Vance Management (EVM) serves as administrator of the Fund but receives no compensation. To reduce the net investment loss of the Fund, the Administrator was allocated $491 of the Fund's operating expenses for the six months ended March 31, 2003. The Portfolio has engaged Boston Management and Research (BMR), a subsidiary of EVM, to render investment advisory services. See Note 2 of the Portfolio's Notes to Financial Statements which are included elsewhere in this report. Except as to Trustees of the Fund and the Portfolio who are not members of EVM's or BMR's organization, officers and Trustees receive remuneration for their services to the Fund out of the investment adviser fee earned by BMR. Effective August 1, 2002, EVM serves as the sub-transfer agent of the Fund and receives from the transfer agent an aggregate fee based upon the actual expenses incurred by EVM in the performance of those services. For the six months ended March 31, 2003, no significant amounts have been earned. Certain officers and Trustees of the Fund and Portfolio are officers of the above organizations. 5 Distribution and Service Plans - ------------------------------------------- The Fund has in effect a distribution plan for Class R (Class R Plan) pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. The Class R Plans allows the Fund to pay Eaton Vance Distributors, Inc. (EVD) amounts equal to 1/365 of 0.25% of the Fund's average daily net assets attributable to Class R shares for providing ongoing distribution services and facilities to the Fund. Although there is not the present intention to do so, the Fund could pay distribution fees of up to 0.50% of Class R's average daily net assets annually upon Trustee approval. The Fund paid or accrued $1 for Class R shares to or payable to EVD for the six months ended March 31, 2003, representing 0.25% (annualized) of the average daily net assets for Class R shares. The Plan authorizes the Fund to make payments of service fees to EVD, investment dealers and other persons in amounts not exceeding 0.25% (annualized) of the Fund's average daily net assets attributable to Class R shares for each fiscal year. Service fee payments will be made for personal services and/or the maintenance of shareholder accounts. Service fee payments for the six months ended March 31, 2003 amounted to $1 for Class R shares. 6 Investment Transactions - ------------------------------------------- Increases and decreases in the Fund's investment in the Portfolio for the six months ended March 31, 2003, aggregated $1,149,126 and $571,095, respectively. 8 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 PORTFOLIO OF INVESTMENTS (UNAUDITED) COMMON STOCKS -- 92.1%
SECURITY SHARES VALUE - --------------------------------------------------------------- Advertising -- 1.8% - --------------------------------------------------------------- Grey Global Group, Inc. 410 $ 252,966 - --------------------------------------------------------------- $ 252,966 - --------------------------------------------------------------- Air Freight -- 2.1% - --------------------------------------------------------------- Forward Air Corp.(1) 13,450 $ 292,685 - --------------------------------------------------------------- $ 292,685 - --------------------------------------------------------------- Airlines -- 1.0% - --------------------------------------------------------------- SkyWest, Inc. 12,700 $ 131,191 - --------------------------------------------------------------- $ 131,191 - --------------------------------------------------------------- Applications Software -- 9.2% - --------------------------------------------------------------- Fair, Isaac and Co., Inc. 7,575 $ 384,962 Jack Henry & Associates, Inc. 21,200 224,508 Kronos, Inc.(1) 3,700 129,685 National Instruments Corp.(1) 11,100 391,497 The Reynolds and Reynolds Co. Class A 5,300 134,090 - --------------------------------------------------------------- $ 1,264,742 - --------------------------------------------------------------- Auto and Parts -- 0.9% - --------------------------------------------------------------- Gentex Corp.(1) 5,100 $ 129,795 - --------------------------------------------------------------- $ 129,795 - --------------------------------------------------------------- Banks -- 9.2% - --------------------------------------------------------------- Capital City Bank Group, Inc. 6,700 $ 262,037 City National Corp. 3,800 166,972 Provident Bankshares Corp. 7,129 164,537 Seacoast Banking Corp. of Florida 13,700 265,643 Texas Regional Bancshares, Class A 8,880 268,087 UCBH Holdings, Inc. 3,000 131,940 - --------------------------------------------------------------- $ 1,259,216 - --------------------------------------------------------------- Broadcast Media -- 1.2% - --------------------------------------------------------------- Cox Radio, Inc., Class A(1) 7,700 $ 159,082 - --------------------------------------------------------------- $ 159,082 - --------------------------------------------------------------- SECURITY SHARES VALUE - --------------------------------------------------------------- Construction - Cement -- 2.5% - --------------------------------------------------------------- Florida Rock Industries, Inc. 10,000 $ 338,500 - --------------------------------------------------------------- $ 338,500 - --------------------------------------------------------------- Consumer Finance -- 2.3% - --------------------------------------------------------------- Financial Federal Corp.(1) 16,800 $ 320,880 - --------------------------------------------------------------- $ 320,880 - --------------------------------------------------------------- Containers and Packaging -- 1.0% - --------------------------------------------------------------- AptarGroup, Inc. 4,100 $ 132,635 - --------------------------------------------------------------- $ 132,635 - --------------------------------------------------------------- Diversified Financial Services -- 3.5% - --------------------------------------------------------------- Affiliated Managers Group, Inc.(1) 8,500 $ 353,345 Allied Capital Corp. 6,600 131,868 - --------------------------------------------------------------- $ 485,213 - --------------------------------------------------------------- Electric Utilities -- 2.7% - --------------------------------------------------------------- ALLETE, Inc. 17,900 $ 371,604 - --------------------------------------------------------------- $ 371,604 - --------------------------------------------------------------- Electrical Equipment -- 1.8% - --------------------------------------------------------------- Brady Corp., Class A 4,800 $ 135,744 C & D Technology, Inc. 9,200 110,216 - --------------------------------------------------------------- $ 245,960 - --------------------------------------------------------------- Electronic Equipment & Instruments -- 2.8% - --------------------------------------------------------------- Roper Industries, Inc. 4,500 $ 129,825 Technitrol, Inc.(1) 17,800 260,592 - --------------------------------------------------------------- $ 390,417 - --------------------------------------------------------------- Engineering & Contruction -- 2.2% - --------------------------------------------------------------- Jacobs Engineering Group, Inc.(1) 7,300 $ 306,673 - --------------------------------------------------------------- $ 306,673 - --------------------------------------------------------------- Food Distributors -- 1.9% - --------------------------------------------------------------- Performance Food Group Co.(1) 8,700 $ 266,742 - --------------------------------------------------------------- $ 266,742 - ---------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 9 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
SECURITY SHARES VALUE - --------------------------------------------------------------- Gas Utilities -- 1.0% - --------------------------------------------------------------- Piedmont Natural Gas Co., Inc. 3,700 $ 131,905 - --------------------------------------------------------------- $ 131,905 - --------------------------------------------------------------- Health Care - Equipment -- 3.4% - --------------------------------------------------------------- Diagnostic Products Corp. 4,400 $ 164,340 Young Innovations, Inc.(1) 13,500 297,135 - --------------------------------------------------------------- $ 461,475 - --------------------------------------------------------------- Health Care - Supplies -- 2.4% - --------------------------------------------------------------- ICU Medical, Inc.(1) 12,150 $ 334,247 - --------------------------------------------------------------- $ 334,247 - --------------------------------------------------------------- Health Services -- 2.4% - --------------------------------------------------------------- First Health Group Corp.(1) 6,400 $ 162,816 Renal Care Group, Inc.(1) 5,300 165,254 - --------------------------------------------------------------- $ 328,070 - --------------------------------------------------------------- Home Furnishings -- 0.9% - --------------------------------------------------------------- La-Z-Boy, Inc. 7,200 $ 124,416 - --------------------------------------------------------------- $ 124,416 - --------------------------------------------------------------- Household Products -- 1.0% - --------------------------------------------------------------- Church & Dwight Co., Inc. 4,500 $ 136,620 - --------------------------------------------------------------- $ 136,620 - --------------------------------------------------------------- Housewares -- 2.4% - --------------------------------------------------------------- Matthews International Corp. 14,300 $ 330,330 - --------------------------------------------------------------- $ 330,330 - --------------------------------------------------------------- Industrial Conglomerate -- 1.0% - --------------------------------------------------------------- Carlisle Companies, Inc. 3,300 $ 133,617 - --------------------------------------------------------------- $ 133,617 - --------------------------------------------------------------- Insurance - Property and Casualty -- 3.8% - --------------------------------------------------------------- Midland Co. 14,600 $ 261,340 Triad Guaranty, Inc.(1) 3,700 127,465 Wesco Financial Corp. 430 128,140 - --------------------------------------------------------------- $ 516,945 - --------------------------------------------------------------- SECURITY SHARES VALUE - --------------------------------------------------------------- Insurance Brokers -- 0.9% - --------------------------------------------------------------- Arthur J. Gallagher & Co. 5,300 $ 130,115 - --------------------------------------------------------------- $ 130,115 - --------------------------------------------------------------- IT Consulting & Services -- 3.9% - --------------------------------------------------------------- FactSet Research Systems, Inc. 6,200 $ 201,190 Manhattan Associates, Inc.(1) 18,900 331,317 - --------------------------------------------------------------- $ 532,507 - --------------------------------------------------------------- Leisure - Products -- 0.7% - --------------------------------------------------------------- Polaris Industries, Inc. 2,000 $ 99,440 - --------------------------------------------------------------- $ 99,440 - --------------------------------------------------------------- Lodging and Hotels -- 1.2% - --------------------------------------------------------------- Marcus Corp., (The) 11,900 $ 161,840 - --------------------------------------------------------------- $ 161,840 - --------------------------------------------------------------- Machinery Industrial -- 1.2% - --------------------------------------------------------------- Graco, Inc. 5,950 $ 167,195 - --------------------------------------------------------------- $ 167,195 - --------------------------------------------------------------- Multi-Utilities -- 1.5% - --------------------------------------------------------------- Energen Corp. 6,300 $ 201,978 - --------------------------------------------------------------- $ 201,978 - --------------------------------------------------------------- Oil and Gas - Exploration and Production -- 2.0% - --------------------------------------------------------------- Newfield Exploration Co.(1) 7,900 $ 267,731 - --------------------------------------------------------------- $ 267,731 - --------------------------------------------------------------- Packaged Foods -- 0.5% - --------------------------------------------------------------- Tootsie Roll Industries, Inc. 2,257 $ 64,401 - --------------------------------------------------------------- $ 64,401 - --------------------------------------------------------------- Paper Products -- 0.9% - --------------------------------------------------------------- Wausau-Mosinee Paper Corp. 12,700 $ 129,540 - --------------------------------------------------------------- $ 129,540 - ---------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 10 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 PORTFOLIO OF INVESTMENTS (UNAUDITED) CONT'D
SECURITY SHARES VALUE - --------------------------------------------------------------- Publishing -- 1.0% - --------------------------------------------------------------- Lee Enterprises, Inc. 4,200 $ 132,384 - --------------------------------------------------------------- $ 132,384 - --------------------------------------------------------------- Restaurants -- 1.2% - --------------------------------------------------------------- Sonic Corp.(1) 6,450 $ 164,217 - --------------------------------------------------------------- $ 164,217 - --------------------------------------------------------------- Retail - Apparel -- 0.9% - --------------------------------------------------------------- Kenneth Cole Productions, Inc.(1) 5,800 $ 127,020 - --------------------------------------------------------------- $ 127,020 - --------------------------------------------------------------- Retail - Food -- 1.9% - --------------------------------------------------------------- Casey's General Stores, Inc. 11,100 $ 132,090 Ruddick Corp. 10,100 124,230 - --------------------------------------------------------------- $ 256,320 - --------------------------------------------------------------- Semiconductor Equipment -- 0.7% - --------------------------------------------------------------- Cohu, Inc. 6,500 $ 95,095 - --------------------------------------------------------------- $ 95,095 - --------------------------------------------------------------- Services - Diversified Commercial -- 3.0% - --------------------------------------------------------------- ABM Industries, Inc. 21,700 $ 285,138 G & K Services, Inc. 5,400 129,600 - --------------------------------------------------------------- $ 414,738 - --------------------------------------------------------------- Services - Employment -- 0.5% - --------------------------------------------------------------- On Assignment, Inc.(1) 15,300 $ 64,719 - --------------------------------------------------------------- $ 64,719 - --------------------------------------------------------------- Specialty Store -- 2.9% - --------------------------------------------------------------- Aaron Rents, Inc. 14,600 $ 297,548 Claire's Stores, Inc. 4,100 96,801 - --------------------------------------------------------------- $ 394,349 - --------------------------------------------------------------- SECURITY SHARES VALUE - --------------------------------------------------------------- Waste Management -- 2.8% - --------------------------------------------------------------- Landauer, Inc. 10,600 $ 389,020 - --------------------------------------------------------------- $ 389,020 - --------------------------------------------------------------- Total Common Stocks (identified cost $13,373,793) $12,638,535 - --------------------------------------------------------------- Total Investments -- 92.1% (identified cost $13,373,793) $12,638,535 - --------------------------------------------------------------- Other Assets, Less Liabilities -- 7.9% $ 1,083,818 - --------------------------------------------------------------- Net Assets -- 100.0% $13,722,353 - ---------------------------------------------------------------
(1) Non-income producing security. SEE NOTES TO FINANCIAL STATEMENTS 11 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 FINANCIAL STATEMENTS (UNAUDITED) STATEMENT OF ASSETS AND LIABILITIES
AS OF MARCH 31, 2003 Assets - ----------------------------------------------------- Investments, at value (identified cost, $13,373,793) $12,638,535 Cash 19,862 Receivable for investments sold 1,261,925 Interest and dividends receivable 17,014 Prepaid expenses 19 - ----------------------------------------------------- TOTAL ASSETS $13,937,355 - ----------------------------------------------------- Liabilities - ----------------------------------------------------- Demand note payable $ 200,000 Accrued expenses 15,002 - ----------------------------------------------------- TOTAL LIABILITIES $ 215,002 - ----------------------------------------------------- NET ASSETS APPLICABLE TO INVESTORS' INTEREST IN PORTFOLIO $13,722,353 - ----------------------------------------------------- Sources of Net Assets - ----------------------------------------------------- Net proceeds from capital contributions and withdrawals $14,457,611 Net unrealized depreciation (computed on the basis of identified cost) (735,258) - ----------------------------------------------------- TOTAL $13,722,353 - -----------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED MARCH 31, 2003 Investment Income - --------------------------------------------------- Dividends $ 86,189 Interest 1,644 - --------------------------------------------------- TOTAL INVESTMENT INCOME $ 87,833 - --------------------------------------------------- Expenses - --------------------------------------------------- Investment adviser fee $ 75,377 Trustees' fees and expenses 93 Custodian fee 15,105 Legal and accounting services 8,694 Miscellaneous 105 - --------------------------------------------------- TOTAL EXPENSES $ 99,374 - --------------------------------------------------- Deduct -- Preliminary reduction of investment adviser fee $ 42,933 - --------------------------------------------------- TOTAL EXPENSE REDUCTIONS $ 42,933 - --------------------------------------------------- NET EXPENSES $ 56,441 - --------------------------------------------------- NET INVESTMENT INCOME $ 31,392 - --------------------------------------------------- Realized and Unrealized Gain (Loss) - --------------------------------------------------- Net realized gain (loss) -- Investment transactions (identified cost basis) $(924,619) - --------------------------------------------------- NET REALIZED LOSS $(924,619) - --------------------------------------------------- Change in unrealized appreciation (depreciation) -- Investments (identified cost basis) $ 855,416 - --------------------------------------------------- NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) $ 855,416 - --------------------------------------------------- NET REALIZED AND UNREALIZED LOSS $ (69,203) - --------------------------------------------------- NET DECREASE IN NET ASSETS FROM OPERATIONS $ (37,811) - ---------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS 12 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 FINANCIAL STATEMENTS CONT'D STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED INCREASE (DECREASE) IN NET MARCH 31, 2003 YEAR ENDED ASSETS (UNAUDITED) SEPTEMBER 30, 2002(1) - ------------------------------------------------------------------------------------ From operations -- Net investment income $ 31,392 $ 10,565 Net realized loss (924,619) (219,112) Net change in unrealized appreciation (depreciation) 855,416 (1,590,674) - ------------------------------------------------------------------------------------ NET DECREASE IN NET ASSETS FROM OPERATIONS $ (37,811) $ (1,799,221) - ------------------------------------------------------------------------------------ Capital transactions -- Contributions $ 3,876,864 $ 16,520,145 Withdrawals (3,882,197) (1,055,437) - ------------------------------------------------------------------------------------ NET INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL TRANSACTIONS $ (5,333) $ 15,464,708 - ------------------------------------------------------------------------------------ NET INCREASE (DECREASE) IN NET ASSETS $ (43,144) $ 13,665,487 - ------------------------------------------------------------------------------------ Net Assets - ------------------------------------------------------------------------------------ At beginning of period $ 13,765,497 $ 100,010 - ------------------------------------------------------------------------------------ AT END OF PERIOD $ 13,722,353 $ 13,765,497 - ------------------------------------------------------------------------------------
(1) For the period from the start of business, April 30, 2002, to September 30, 2002. SEE NOTES TO FINANCIAL STATEMENTS 13 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 FINANCIAL STATEMENTS CONT'D SUPPLEMENTARY DATA
SIX MONTHS ENDED MARCH 31, 2003 YEAR ENDED (UNAUDITED) SEPTEMBER 30, 2002(1) - ------------------------------------------------------------------------------- Ratios/Supplemental Data+ - ------------------------------------------------------------------------------- Ratios (As a percentage of average daily net assets): Net expenses 0.75%(2) 0.92%(2) Net expenses after custodian fee reduction 0.75%(2) 0.90%(2) Net investment income 0.42%(2) 0.23%(2) Portfolio Turnover 26% 17% - ------------------------------------------------------------------------------- TOTAL RETURN 0.30% (22.75)% - ------------------------------------------------------------------------------- NET ASSETS, END OF PERIOD (000'S OMITTED) $13,722 $13,765 - ------------------------------------------------------------------------------- + The operating expenses of the Portfolio reflect a reduction of the investment adviser fee. Had such action not been taken, the ratios would have been as follows: Ratios (As a percentage of average daily net assets): Expenses 1.32%(2) 1.65%(2) Expenses after custodian fee reduction 1.32%(2) 1.63%(2) Net investment loss (0.15)%(2) (0.50)%(2) - -------------------------------------------------------------------------------
(1) For the period from the start of business, April 30, 2002, to September 30, 2002. (2) Annualized. SEE NOTES TO FINANCIAL STATEMENTS 14 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 1 Significant Accounting Policies - ------------------------------------------- Small-Cap Portfolio (the Portfolio) is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The Portfolio, which was organized as a trust under the laws of the State of New York on December 10, 2001, seeks to achieve long-term capital growth by investing in a diversified portfolio of equity securities of companies having market capitalizations within the range of companies comprising the Russell 2000 (small company stocks), emphasizing quality small companies whose stocks are considered to trade at attractive valuations relative to earnings or cash flow per share. The Declaration of Trust permits the Trustees to issue interests in the Portfolio. At March 31, 2003, the Eaton Vance Small-Cap Fund and the Atlanta Capital Small-Cap Fund held 31.8% and 54.8% interests in the Portfolio, respectively. In addition, one other investor owned a greater than 10% interest in the Portfolio (12.3% at March 31, 2003). The following is a summary of significant accounting policies consistently followed by the Portfolio 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 -- Marketable securities, including options, that are listed on foreign or U.S. securities exchanges are valued at closing sale prices on the exchange where such securities are principally traded. Marketable securities listed in the NASDAQ National Market System are valued at the NASDAQ official closing price. Unlisted or listed securities for which closing sale prices are not available are generally valued at the mean between the latest bid and asked prices. Futures positions on securities or currencies are generally valued at closing settlement prices. Short-term debt securities with a remaining maturity of 60 days or less are valued at amortized cost, which approximates value. 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. B Income -- Dividend income is recorded on the ex-dividend date for dividends received in cash and/or securities. 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 determined on the basis of interest accrued, adjusted for amortization of premium or accretion of discount. C Income Taxes -- The Portfolio is treated as a partnership for federal tax purposes. No provision is made by the Portfolio for federal or state taxes on any taxable income of the Portfolio because each investor in the Portfolio is ultimately responsible for the payment of any taxes. Since at least 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. D Expense Reduction -- Investors Bank & Trust Company (IBT) serves as custodian to the Portfolio. Pursuant to the custodian agreement, IBT receives a fee reduced by credits which are determined based on the average daily cash balances the Portfolio maintains with IBT. All significant credit balances used to reduce the Portfolio's custodian fees are reported as a reduction of total expenses on the Statement of Operations. E Other -- Investment transactions are accounted for on a trade date basis. Realized gains and losses are computed based on the specific identification of securities sold. F 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. G Interim Financial Statements -- The interim financial statements relating to March 31, 2003 and for the six months then ended have not been audited by independent certified public accountants, but in the opinion of the Portfolio's management reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements. 15 SMALL-CAP PORTFOLIO AS OF MARCH 31, 2003 NOTES TO FINANCIAL STATEMENTS (UNAUDITED) CONT'D 2 Investment Adviser Fee and Other Transactions with Affiliates - ------------------------------------------- The investment adviser fee is earned by Boston Management and Research (BMR), a wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for management and investment advisory services rendered to the Portfolio. Under the advisory agreement, BMR receives a monthly advisory fee equal to 1.00% annually of the average daily net assets of the Portfolio up to $500 million, and at reduced rates as daily net assets exceed that level. For the six months ended March 31, 2003, the adviser fee amounted to $75,377. In order to enhance the net investment income of the Portfolio, BMR made a reduction of the investment adviser fee of $42,933. Pursuant to a sub-advisory agreement, BMR has delegated the investment management of the Portfolio to Atlanta Capital Management LLC ("Atlanta Capital"), a majority-owned subsidiary of EVM. BMR pays Atlanta Capital a monthly fee for sub-advisory services provided to the Portfolio in the amount of 0.750% annually of average daily net assets up to $500 million, and at reduced rates as daily net assets exceed that level. Except as to Trustees of the Portfolio who are not members of EVM's or BMR's organization, officers and Trustees receive remuneration for their services to the Portfolio out of such investment adviser fee. Trustees of the Portfolio that are not affiliated with the Investment Adviser may elect to defer receipt of all or a percentage of their annual fees in accordance with the terms of the Trustees Deferred Compensation Plan. For the six months ended March 31, 2003, 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 $3,638,493 and $4,125,398, respectively, for the six months ended March 31, 2003. 4 Federal Income Tax Basis of Unrealized Appreciation (Depreciation) - ------------------------------------------- The cost and unrealized appreciation (depreciation) in value of the investments owned at March 31, 2003, as computed on a federal income tax basis, were as follows: AGGREGATE COST $13,373,793 ----------------------------------------------------- Gross unrealized appreciation $ 663,936 Gross unrealized depreciation (1,399,194) ----------------------------------------------------- NET UNREALIZED DEPRECIATION $ (735,258) -----------------------------------------------------
5 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 participating 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 line of credit is allocated among the participating portfolios and funds at the end of each quarter. At March 31, 2003, the Portfolio had a balance pursuant to this line of credit of $200,000. The Portfolio did not have any significant borrowings or allocated fees during the six months ended March 31, 2003. 16 ATLANTA CAPITAL SMALL-CAP FUND AS OF MARCH 31, 2003 INVESTMENT MANAGEMENT ATLANTA CAPITAL SMALL-CAP FUND Officers Thomas E. Faust Jr. President Gregory L. Coleman Vice President James A. Womack Vice President James L. O'Connor Treasurer Alan R. Dynner Secretary Trustees Jessica M. Bibliowicz President and Chief Executive Officer, National Financial Partners Donald R. Dwight President, Dwight Partners, Inc. James B. Hawkes Chairman, President and Chief Executive Officer of Eaton Vance Corp. and officer and/or director of its subsidiaries Samuel L. Hayes, III Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University Graduate School of Business Administration Norton H. Reamer President, Unicorn Corporation Chairman, Hellman, Jordan Management Co., Inc. Advisory Director of Berkshire Capital Corporation Lynn A. Stout Professor of Law, UCLA School of Law Jack L. Treynor Investment Adviser and Consultant SMALL-CAP PORTFOLIO Officers James B. Hawkes President and Trustee Thomas E. Faust Jr. Vice President William R. Hackney, III Vice President Paul J. Marshall Vice President Charles B. Reed Vice President Kristin S. Anagnost Treasurer Alan R. Dynner Secretary Trustees Jessica M. Bibliowicz President and Chief Executive Officer, National Financial Partners Donald R. Dwight President, Dwight Partners, Inc. Samuel L. Hayes, III Jacob H. Schiff Professor of Investment Banking Emeritus, Harvard University Graduate School of Business Administration Norton H. Reamer President, Unicorn Corporation Chairman, Hellman, Jordan Management Co., Inc. Advisory Director of Berkshire Capital Corporation Lynn A. Stout Professor of Law, UCLA School of Law Jack L. Treynor Investment Adviser and Consultant 17 INVESTMENT ADVISER OF SMALL-CAP PORTFOLIO BOSTON MANAGEMENT AND RESEARCH The Eaton Vance Building 255 State Street Boston, MA 02109 SUB-ADVISER OF SMALL-CAP PORTFOLIO ATLANTA CAPITAL MANAGEMENT LLC 1349 West Peachtree Street Suite 1600 Atlanta, GA 30309 ADMINISTRATOR OF ATLANTA CAPITAL SMALL-CAP FUND EATON VANCE MANAGEMENT The Eaton Vance Building 255 State Street Boston, MA 02109 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 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 ATLANTA CAPITAL SMALL-CAP 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 distribution plan, sales charges and expenses. Please read the prospectus carefully before you invest or send money. 1452-5/03 ASCSRC -----END PRIVACY-ENHANCED MESSAGE-----